Attached files
| file | filename |
|---|---|
| EX-99.2 - EX-99.2 - Bridgewater Bancshares Inc | ex-99d2.htm |
| 8-K - 8-K - Bridgewater Bancshares Inc | f8-k.htm |
Exhibit 99.1
Bridgewater Bancshares, Inc. Announces Record Fourth Quarter 2018 Earnings
Bridgewater Bancshares, Inc. (Nasdaq: BWB) (the Company), the parent company of Bridgewater Bank (the Bank), today announced net income of $7.8 million for the fourth quarter of 2018, a 132.8% increase over net income of $3.3 million for the fourth quarter of 2017. Net income per diluted common share for the fourth quarter of 2018 was $0.25, a 91.1% increase, compared to $0.13 of net income per diluted common share for the same period in 2017.
The fourth quarter of 2017 included a one-time expense in the amount of $2.0 million related to the enactment of the Tax Cuts and Jobs Act (“Tax Reform”). Excluding the one-time impact of Tax Reform in the fourth quarter of 2017, net income increased 45.4% in the fourth quarter of 2018 over the fourth quarter of 2017.
“2018 was an eventful year beginning with our initial public offering in the first quarter and concluding with record earnings for the year and the fourth quarter,” noted Chairman, Chief Executive Officer, and President, Jerry Baack. “We closed out the year with strong organic loan and deposit growth and continue to be very pleased with credit quality as nonperforming assets have trended to just 0.03% of total assets. As we continue to execute our efficient business model in 2019, we also look to continue strategic investments in talent and technology to best serve our clients.”
Fourth Quarter 2018 Financial Results
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Basic |
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Diluted |
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Tangible book |
|||
|
ROA |
|
ROE |
|
Earnings per share |
|
Earnings per share |
|
Efficiency ratio (1) |
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value per share (1) |
|||
|
1.58% |
|
14.30% |
|
$ |
0.26 |
|
$ |
0.25 |
|
60.0% |
|
$ |
7.22 |
|
(1) |
Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details. |
Fourth Quarter 2018 Highlights
|
· |
Annualized return on average assets (ROA) and return on average common equity (ROE) for the fourth quarter of 2018 were 1.58% and 14.30%, respectively, compared to annualized ROA and ROE of 0.83% and 9.73%, respectively, for the fourth quarter of 2017. |
|
· |
Net income was $7.8 million for the fourth quarter of 2018 compared to $3.3 million for the fourth quarter of 2017, an increase of 132.8%. |
|
· |
Diluted earnings per common share for the fourth quarter of 2018 were $0.25, compared to $0.13 for the fourth quarter of 2017. |
|
· |
Nonperforming assets to total assets decreased to 0.03%, compared to 0.11% at December 31, 2017. |
|
· |
Adjusted efficiency ratio, a non-GAAP financial measure which excludes the impact of the amortization of tax credit investments from noninterest expense, was 42.1% for the fourth quarter of 2018, compared to 44.1% for the fourth quarter of 2017. |
Annual 2018 Highlights
|
· |
ROA and ROE for the year ended December 31, 2018 were 1.51% and 13.87%, respectively, compared to ROA and ROE of 1.16% and 13.18%, respectively, for the year ended December 31, 2017. |
|
· |
Net income was $26.9 million for the year ended December 31, 2018 compared to $16.9 million for the year ended December 31, 2017, an increase of 59.4%. |
|
· |
Diluted earnings per common share for the year ended December 31, 2018 were $0.91, compared to $0.68 for the year ended December 31, 2017. |
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· |
Gross loans increased $317.8 million to $1.66 billion for the year ended December 31, 2018, compared to $1.35 billion as of December 31, 2017, an increase of 23.6%. |
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· |
Net loan charge-offs as a percent of average loans was 0.00% for the year ended December 31, 2018. |
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· |
Tangible book value per share, a non-GAAP financial measure, increased 33.7%, from $5.40 as of December 31, 2017 to $7.22 as of December 31, 2018. |
Page 1 of 12
Key Financial Measures
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As of and for the Three Months Ended |
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As of and for the Year Ended |
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||||||||
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December 31, |
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December 31, |
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December 31, |
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December 31, |
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||||
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2018 |
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2017 |
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2018 |
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2017 |
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Per Common Share Data (1) |
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Basic Earnings Per Share |
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$ |
0.26 |
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$ |
0.14 |
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$ |
0.93 |
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$ |
0.69 |
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Diluted Earnings Per Share |
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0.25 |
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0.13 |
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0.91 |
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0.68 |
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Book Value Per Share |
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7.34 |
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5.56 |
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Tangible Book Value Per Share (2) |
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7.22 |
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5.40 |
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Basic Weighted Average Shares Outstanding |
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30,072,003 |
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24,636,926 |
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29,001,393 |
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24,604,464 |
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Diluted Weighted Average Shares Outstanding |
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30,506,824 |
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25,050,152 |
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29,436,214 |
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|
25,017,690 |
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Shares Outstanding at Period End |
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30,097,274 |
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24,679,861 |
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Selected Performance Ratios |
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Return on Average Assets (Annualized) |
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|
1.58 |
% |
|
0.83 |
% |
(5) |
|
1.51 |
% |
|
1.16 |
% |
(5) |
|
Return on Average Common Equity (Annualized) |
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|
14.30 |
|
|
9.73 |
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(5) |
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13.87 |
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|
13.18 |
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(5) |
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Return on Average Tangible Common Equity (Annualized) (2) |
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|
14.55 |
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10.02 |
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14.15 |
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13.60 |
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Yield on Interest Earning Assets |
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4.96 |
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4.82 |
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4.88 |
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|
4.76 |
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Yield on Total Loans, Gross |
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5.27 |
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5.13 |
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5.23 |
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5.10 |
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Cost of Interest Bearing Liabilities |
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1.92 |
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1.29 |
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|
|
1.65 |
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|
1.19 |
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Cost of Total Deposits |
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|
1.32 |
|
|
0.85 |
|
|
|
1.12 |
|
|
0.80 |
|
|
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Net Interest Margin (3) |
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|
3.62 |
|
|
3.88 |
|
|
|
3.72 |
|
|
3.92 |
|
|
|
Efficiency Ratio (2) |
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60.0 |
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56.4 |
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46.5 |
|
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44.4 |
|
|
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Adjusted Efficiency Ratio (4) |
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|
42.1 |
|
|
44.1 |
|
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|
41.7 |
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|
41.1 |
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Noninterest Expense to Average Assets (Annualized) |
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2.25 |
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2.22 |
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|
1.78 |
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|
1.76 |
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|
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Loan to Deposit Ratio |
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106.7 |
|
|
100.6 |
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|
|
|
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|
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Core Deposits to Total Deposits |
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75.8 |
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76.7 |
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Tangible Common Equity to Tangible Assets (2) |
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11.03 |
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8.26 |
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Capital Ratios (Bank Only) |
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Tier 1 Leverage Ratio |
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10.82 |
% |
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9.83 |
% |
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Tier 1 Risk-based Capital Ratio |
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11.63 |
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11.15 |
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Total Risk-based Capital Ratio |
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12.76 |
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12.37 |
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|
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(1) |
Includes shares of common stock and non-voting common stock. On October 25, 2018, the Company exchanged shares of common stock for all of the outstanding shares of non-voting common stock. Following the exchange, no shares of non-voting common stock were outstanding. |
|
(2) |
Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details. |
|
(3) |
Amounts calculated on a tax-equivalent basis using the statutory federal tax rate of 21% for 2018 and 35% for 2017. |
|
(4) |
Ratio excludes the amortization of tax credit investments and represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details. |
|
(5) |
ROA and ROE, excluding a one-time additional expense of $2.0 million related to the revaluation of the deferred tax asset, would have been 1.34% and 15.59%, respectively for the three months ended December 31, 2017 and 1.30% and 14.75%, respectively for the year ended December 31, 2107. |
Page 2 of 12
Selected Financial Data
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December 31, |
|
December 31, |
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|
|
||
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(dollars in thousands) |
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2018 |
|
2017 |
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% Change |
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Selected Balance Sheet Data |
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Total Assets |
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$ |
1,973,741 |
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$ |
1,616,612 |
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22.1 |
% |
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Total Loans, Gross |
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|
1,664,931 |
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|
1,347,113 |
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23.6 |
|
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Allowance for Loan Losses |
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|
20,031 |
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16,502 |
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21.4 |
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Goodwill and Other Intangibles |
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3,678 |
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3,869 |
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(4.9) |
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Deposits |
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1,560,934 |
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1,339,350 |
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16.5 |
|
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Tangible Common Equity (1) |
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|
217,320 |
|
|
133,293 |
|
63.0 |
|
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Total Shareholders' Equity |
|
|
220,998 |
|
|
137,162 |
|
61.1 |
|
|
Average Total Assets - Quarter-to-Date |
|
|
1,948,909 |
|
|
1,584,721 |
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23.0 |
|
|
Average Common Equity - Quarter-to-Date |
|
|
215,254 |
|
|
135,875 |
|
58.4 |
|
|
(1) |
Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details. |
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For the Three Months Ended |
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For the Year Ended |
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||||||||
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December 31, |
|
December 31, |
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|
|
|
December 31, |
|
December 31, |
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|
|
||||
|
(dollars in thousands) |
|
2018 |
|
2017 |
|
% Change |
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|
2018 |
|
2017 |
|
% Change |
|
||||
|
Selected Income Statement Data |
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|
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Interest Income |
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$ |
23,988 |
|
$ |
18,576 |
|
29.1 |
% |
|
$ |
85,226 |
|
$ |
66,346 |
|
28.5 |
% |
|
Interest Expense |
|
|
6,546 |
|
|
3,727 |
|
75.6 |
|
|
|
20,488 |
|
|
12,173 |
|
68.3 |
|
|
Net Interest Income |
|
|
17,442 |
|
|
14,849 |
|
17.5 |
|
|
|
64,738 |
|
|
54,173 |
|
19.5 |
|
|
Provision for Loan Losses |
|
|
800 |
|
|
1,200 |
|
(33.3) |
|
|
|
3,575 |
|
|
4,175 |
|
(14.4) |
|
|
Net Interest Income after Provision for Loan Losses |
|
|
16,642 |
|
|
13,649 |
|
21.9 |
|
|
|
61,163 |
|
|
49,998 |
|
22.3 |
|
|
Noninterest Income |
|
|
857 |
|
|
583 |
|
47.0 |
|
|
|
2,543 |
|
|
2,536 |
|
0.3 |
|
|
Noninterest Expense |
|
|
11,040 |
|
|
8,862 |
|
24.6 |
|
|
|
31,562 |
|
|
25,496 |
|
23.8 |
|
|
Income Before Income Taxes |
|
|
6,459 |
|
|
5,370 |
|
20.3 |
|
|
|
32,144 |
|
|
27,038 |
|
18.9 |
|
|
Provision (Benefit) for Income Taxes |
|
|
(1,302) |
|
|
2,036 |
|
(163.9) |
|
|
|
5,224 |
|
|
10,149 |
|
(48.5) |
|
|
Net Income |
|
$ |
7,761 |
|
$ |
3,334 |
|
132.8 |
|
|
$ |
26,920 |
|
$ |
16,889 |
|
59.4 |
|
Income Statement
Net Interest Income
Net interest income was $17.4 million for the fourth quarter of 2018, an increase of $2.6 million, or 17.5%, compared to $14.8 million for the fourth quarter of 2017. The increase in net interest income was largely attributable to growth in average interest earning assets, which increased by 23.3% to $1.94 billion for the three months ended December 31, 2018, from $1.57 billion for the three months ended December 31, 2017. This increase in average interest earning assets was primarily due to continued organic growth in the loan portfolio.
Net interest margin (on a fully tax-equivalent basis) for the fourth quarter of 2018 was 3.62%, compared to 3.88% for the fourth quarter of 2017, a decrease of 26 basis points. While net interest margin has benefitted from the repricing of variable-rate loans and the origination of new loans at higher rates, this was offset by increased balances and rates on deposits and borrowings. Furthermore, the new lower statutory federal tax rate reduced the tax equivalent adjustment by five basis points.
Interest income increased $5.4 million, or 29.1%, to $24.0 million for the fourth quarter of 2018, compared to $18.6 million for the fourth quarter of 2017, primarily due to the increase in average loan balances. The yield on interest earning assets (on a fully tax-equivalent basis) rose to 4.96% in the fourth quarter of 2018, compared to 4.82% in the fourth quarter of 2017. Loan interest income and loan fees remain the primary contributing factors to the increase in yield on interest earning assets, driving the aggregate loan yield 14 basis points higher from 5.13% in the fourth quarter of 2017 to 5.27% in the fourth quarter of 2018.
Interest expense increased $2.8 million to $6.5 million for the fourth quarter of 2018, compared to $3.7 million for the fourth quarter of 2017, primarily due to increases in interest rates and average balances of both deposits and borrowings. The cost of interest bearing liabilities increased to 1.92% in the fourth quarter of 2018 from 1.29% in the fourth quarter of 2017 due to higher costs of both deposits and borrowings compared to the fourth quarter of 2017.
Page 3 of 12
A summary of the Company’s average balances, interest yields and rates, and net interest margin for the three months and years ended December 31, 2018 and 2017 is as follows:
Consolidated Average Balances, Interest Yields and Rates
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For the Three Months Ended |
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||||||||||||||
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December 31, 2018 |
|
December 31, 2017 |
|
||||||||||||
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|
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Average |
|
Interest |
|
Yield/ |
|
Average |
|
Interest |
|
Yield/ |
|
||||
|
|
|
Balance |
|
& Fees |
|
Rate |
|
Balance |
|
& Fees |
|
Rate |
|
||||
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Earning Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Investments |
|
$ |
21,249 |
|
$ |
63 |
|
1.18 |
% |
$ |
21,659 |
|
$ |
46 |
|
0.84 |
% |
|
Investment Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable Investment Securities |
|
|
140,858 |
|
|
918 |
|
2.59 |
|
|
110,533 |
|
|
551 |
|
1.98 |
|
|
Tax-Exempt Investment Securities (1) |
|
|
114,356 |
|
|
1,196 |
|
4.15 |
|
|
123,559 |
|
|
1,517 |
|
4.87 |
|
|
Total Investment Securities |
|
|
255,214 |
|
|
2,114 |
|
3.29 |
|
|
234,092 |
|
|
2,068 |
|
3.50 |
|
|
Loans (2) |
|
|
1,654,415 |
|
|
21,978 |
|
5.27 |
|
|
1,311,837 |
|
|
16,964 |
|
5.13 |
|
|
Federal Home Loan Bank Stock |
|
|
7,759 |
|
|
83 |
|
4.24 |
|
|
4,814 |
|
|
29 |
|
2.39 |
|
|
Total Interest Earning Assets |
|
|
1,938,637 |
|
|
24,238 |
|
4.96 |
% |
|
1,572,402 |
|
|
19,107 |
|
4.82 |
% |
|
Noninterest Earning Assets |
|
|
10,272 |
|
|
|
|
|
|
|
12,319 |
|
|
|
|
|
|
|
Total Assets |
|
$ |
1,948,909 |
|
|
|
|
|
|
$ |
1,584,721 |
|
|
|
|
|
|
|
Interest Bearing Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Bearing Transaction Deposits |
|
|
173,825 |
|
|
197 |
|
0.45 |
% |
|
176,068 |
|
|
116 |
|
0.26 |
% |
|
Savings and Money Market Deposits |
|
|
426,185 |
|
|
1,675 |
|
1.56 |
|
|
337,027 |
|
|
715 |
|
0.84 |
|
|
Time Deposits |
|
|
301,372 |
|
|
1,633 |
|
2.15 |
|
|
290,516 |
|
|
1,148 |
|
1.57 |
|
|
Brokered Deposits |
|
|
265,523 |
|
|
1,614 |
|
2.41 |
|
|
216,044 |
|
|
843 |
|
1.55 |
|
|
Federal Funds Purchased |
|
|
50,228 |
|
|
315 |
|
2.49 |
|
|
14,391 |
|
|
50 |
|
1.38 |
|
|
Notes Payable |
|
|
15,000 |
|
|
152 |
|
4.02 |
|
|
17,000 |
|
|
159 |
|
3.71 |
|
|
FHLB Advances |
|
|
95,467 |
|
|
559 |
|
2.32 |
|
|
68,339 |
|
|
295 |
|
1.71 |
|
|
Subordinated Debentures |
|
|
24,621 |
|
|
401 |
|
6.46 |
|
|
24,518 |
|
|
401 |
|
6.49 |
|
|
Total Interest Bearing Liabilities |
|
|
1,352,221 |
|
|
6,546 |
|
1.92 |
% |
|
1,143,903 |
|
|
3,727 |
|
1.29 |
% |
|
Noninterest Bearing Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest Bearing Transaction Deposits |
|
|
370,792 |
|
|
|
|
|
|
|
296,070 |
|
|
|
|
|
|
|
Other Noninterest Bearing Liabilities |
|
|
10,642 |
|
|
|
|
|
|
|
8,873 |
|
|
|
|
|
|
|
Total Noninterest Bearing Liabilities |
|
|
381,434 |
|
|
|
|
|
|
|
304,943 |
|
|
|
|
|
|
|
Shareholders' Equity |
|
|
215,254 |
|
|
|
|
|
|
|
135,875 |
|
|
|
|
|
|
|
Total Liabilities and Shareholders' Equity |
|
$ |
1,948,909 |
|
|
|
|
|
|
$ |
1,584,721 |
|
|
|
|
|
|
|
Net Interest Income / Interest Rate Spread |
|
|
|
|
|
17,692 |
|
3.04 |
% |
|
|
|
|
15,380 |
|
3.53 |
% |
|
Net Interest Margin (3) |
|
|
|
|
|
|
|
3.62 |
% |
|
|
|
|
|
|
3.88 |
% |
|
Taxable Equivalent Adjustment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-Exempt Investment Securities |
|
|
|
|
|
(250) |
|
|
|
|
|
|
|
(531) |
|
|
|
|
Net Interest Income |
|
|
|
|
$ |
17,442 |
|
|
|
|
|
|
$ |
14,849 |
|
|
|
|
(1) |
Interest income and average rates for tax-exempt investment securities are presented on a tax-equivalent basis, assuming a statutory federal income tax rate of 21% in 2018 and 35% in 2017. |
|
(2) |
Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs. |
|
(3) |
Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period. |
Page 4 of 12
|
|
|
For the Year Ended |
|
||||||||||||||
|
|
|
December 31, 2018 |
|
December 31, 2017 |
|
||||||||||||
|
|
|
Average |
|
Interest |
|
Yield/ |
|
Average |
|
Interest |
|
Yield/ |
|
||||
|
|
|
Balance |
|
& Fees |
|
Rate |
|
Balance |
|
& Fees |
|
Rate |
|
||||
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Earning Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Investments |
|
$ |
22,962 |
|
$ |
250 |
|
1.09 |
% |
$ |
25,306 |
|
$ |
226 |
|
0.89 |
% |
|
Investment Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable Investment Securities |
|
|
129,486 |
|
|
2,878 |
|
2.22 |
|
|
102,115 |
|
|
1,892 |
|
1.85 |
|
|
Tax-Exempt Investment Securities (1) |
|
|
116,557 |
|
|
4,830 |
|
4.14 |
|
|
130,289 |
|
|
6,289 |
|
4.83 |
|
|
Total Investment Securities |
|
|
246,043 |
|
|
7,708 |
|
3.13 |
|
|
232,404 |
|
|
8,181 |
|
3.52 |
|
|
Loans (2) |
|
|
1,491,166 |
|
|
78,033 |
|
5.23 |
|
|
1,177,491 |
|
|
60,024 |
|
5.10 |
|
|
Federal Home Loan Bank Stock |
|
|
6,321 |
|
|
249 |
|
3.94 |
|
|
4,288 |
|
|
115 |
|
2.68 |
|
|
Total Interest Earning Assets |
|
|
1,766,492 |
|
|
86,240 |
|
4.88 |
% |
|
1,439,489 |
|
|
68,546 |
|
4.76 |
% |
|
Noninterest Earning Assets |
|
|
11,100 |
|
|
|
|
|
|
|
12,243 |
|
|
|
|
|
|
|
Total Assets |
|
$ |
1,777,592 |
|
|
|
|
|
|
$ |
1,451,732 |
|
|
|
|
|
|
|
Interest Bearing Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Bearing Transaction Deposits |
|
|
177,335 |
|
|
635 |
|
0.36 |
% |
|
161,454 |
|
|
389 |
|
0.24 |
% |
|
Savings and Money Market Deposits |
|
|
381,318 |
|
|
4,681 |
|
1.23 |
|
|
284,641 |
|
|
2,218 |
|
0.78 |
|
|
Time Deposits |
|
|
300,021 |
|
|
5,731 |
|
1.91 |
|
|
286,840 |
|
|
4,360 |
|
1.52 |
|
|
Brokered Deposits |
|
|
232,022 |
|
|
4,924 |
|
2.12 |
|
|
185,144 |
|
|
2,752 |
|
1.49 |
|
|
Federal Funds Purchased |
|
|
29,671 |
|
|
637 |
|
2.15 |
|
|
15,247 |
|
|
169 |
|
1.11 |
|
|
Notes Payable |
|
|
15,750 |
|
|
594 |
|
3.77 |
|
|
17,750 |
|
|
656 |
|
3.70 |
|
|
FHLB Advances |
|
|
82,562 |
|
|
1,718 |
|
2.08 |
|
|
56,458 |
|
|
880 |
|
1.56 |
|
|
Subordinated Debentures |
|
|
24,582 |
|
|
1,568 |
|
6.38 |
|
|
12,253 |
|
|
749 |
|
6.11 |
|
|
Total Interest Bearing Liabilities |
|
|
1,243,261 |
|
|
20,488 |
|
1.65 |
% |
|
1,019,787 |
|
|
12,173 |
|
1.19 |
% |
|
Noninterest Bearing Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest Bearing Transaction Deposits |
|
|
330,898 |
|
|
|
|
|
|
|
299,232 |
|
|
|
|
|
|
|
Other Noninterest Bearing Liabilities |
|
|
9,350 |
|
|
|
|
|
|
|
4,590 |
|
|
|
|
|
|
|
Total Noninterest Bearing Liabilities |
|
|
340,248 |
|
|
|
|
|
|
|
303,822 |
|
|
|
|
|
|
|
Shareholders' Equity |
|
|
194,083 |
|
|
|
|
|
|
|
128,123 |
|
|
|
|
|
|
|
Total Liabilities and Shareholders' Equity |
|
$ |
1,777,592 |
|
|
|
|
|
|
$ |
1,451,732 |
|
|
|
|
|
|
|
Net Interest Income / Interest Rate Spread |
|
|
|
|
|
65,752 |
|
3.23 |
% |
|
|
|
|
56,373 |
|
3.57 |
% |
|
Net Interest Margin (3) |
|
|
|
|
|
|
|
3.72 |
% |
|
|
|
|
|
|
3.92 |
% |
|
Taxable Equivalent Adjustment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-Exempt Investment Securities |
|
|
|
|
|
(1,014) |
|
|
|
|
|
|
|
(2,200) |
|
|
|
|
Net Interest Income |
|
|
|
|
$ |
64,738 |
|
|
|
|
|
|
$ |
54,173 |
|
|
|
|
(1) |
Interest income and average rates for tax-exempt investment securities are presented on a tax-equivalent basis, assuming a statutory federal income tax rate of 21% in 2018 and 35% in 2017. |
|
(2) |
Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs. |
|
(3) |
Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period. |
Provision for Loan Losses
The provision for loan losses was $800,000 for the fourth quarter of 2018, a decrease of $400,000 compared to the provision for loan losses of $1.2 million for the fourth quarter of 2017. The provision decreased in the fourth quarter of 2018 primarily due to continued strength in credit quality and lower loan growth in comparison to the fourth quarter of 2017.
A reconciliation of the Company’s allowance for loan losses for the three months and years ended December 31, 2018 and 2017 is as follows:
|
|
|
Three Months Ended |
|
Year Ended |
||||||||
|
|
|
December 31, |
|
December 31, |
||||||||
|
(dollars in thousands) |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
||||
|
Balance at Beginning of Period |
|
$ |
18,949 |
|
$ |
15,219 |
|
$ |
16,502 |
|
$ |
12,333 |
|
Provision for Loan Losses |
|
|
800 |
|
|
1,200 |
|
|
3,575 |
|
|
4,175 |
|
Charge-offs |
|
|
(37) |
|
|
(47) |
|
|
(421) |
|
|
(177) |
|
Recoveries |
|
|
319 |
|
|
130 |
|
|
375 |
|
|
171 |
|
Balance at End of Period |
|
$ |
20,031 |
|
$ |
16,502 |
|
$ |
20,031 |
|
$ |
16,502 |
Page 5 of 12
Noninterest Income
Noninterest income was $857,000 for the fourth quarter of 2018, an increase of $274,000 from $583,000 for the fourth quarter of 2017.
The following table presents the major components of noninterest income for the three month period and year ended December 31, 2018, compared to the three month period and year ended December 31, 2017:
|
|
|
Three Months Ended |
|
|
|
|
Year Ended |
|
|
|
||||||||
|
|
|
December 31, |
|
Increase/ |
|
December 31, |
|
Increase/ |
||||||||||
|
(dollars in thousands) |
|
2018 |
|
2017 |
|
(Decrease) |
|
2018 |
|
2017 |
|
(Decrease) |
||||||
|
Noninterest Income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer Service Fees |
|
$ |
206 |
|
$ |
177 |
|
$ |
29 |
|
$ |
745 |
|
$ |
660 |
|
$ |
85 |
|
Net Loss on Sales of Securities |
|
|
(17) |
|
|
(199) |
|
|
182 |
|
|
(125) |
|
|
(250) |
|
|
125 |
|
Net Gain (Loss) on Sales of Foreclosed Assets |
|
|
— |
|
|
4 |
|
|
(4) |
|
|
(225) |
|
|
356 |
|
|
(581) |
|
Letter of Credit Fees |
|
|
482 |
|
|
438 |
|
|
44 |
|
|
1,296 |
|
|
1,072 |
|
|
224 |
|
Debit Card Interchange Fees |
|
|
104 |
|
|
97 |
|
|
7 |
|
|
391 |
|
|
390 |
|
|
1 |
|
Other Income |
|
|
82 |
|
|
66 |
|
|
16 |
|
|
461 |
|
|
308 |
|
|
153 |
|
Totals |
|
$ |
857 |
|
$ |
583 |
|
$ |
274 |
|
$ |
2,543 |
|
$ |
2,536 |
|
$ |
7 |
Noninterest Expense
Noninterest expense was $11.0 million for the fourth quarter of 2018, an increase of $2.2 million, or 24.6% from $8.9 million for the fourth quarter of 2017. The increase was primarily driven by a $1.0 million increase in salaries and employee benefits as the result of merit increases and increased staff to meet the needs of the Company’s growth and a $1.4 million increase in amortization of tax credit investments. The increase was partially offset by a decrease of $581,000 in professional and consulting fees due to higher expenses incurred in the fourth quarter of 2017 in preparation of the Company’s initial public offering, in comparison to the fourth quarter of 2018.
The following table presents the major components of noninterest expense for the three month period and year ended December 31, 2018, compared to the three month period and year ended December 31, 2017:
|
|
|
Three Months Ended |
|
|
|
|
Year Ended |
|
|
|
||||||||
|
|
|
December 31, |
|
Increase/ |
|
December 31, |
|
Increase/ |
||||||||||
|
(dollars in thousands) |
|
2018 |
|
2017 |
|
(Decrease) |
|
2018 |
|
2017 |
|
(Decrease) |
||||||
|
Noninterest Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and Employee Benefits |
|
$ |
5,086 |
|
$ |
4,106 |
|
$ |
980 |
|
$ |
18,620 |
|
$ |
14,051 |
|
$ |
4,569 |
|
Occupancy and Equipment |
|
|
584 |
|
|
563 |
|
|
21 |
|
|
2,351 |
|
|
2,192 |
|
|
159 |
|
FDIC Insurance Assessment |
|
|
240 |
|
|
245 |
|
|
(5) |
|
|
915 |
|
|
770 |
|
|
145 |
|
Data Processing |
|
|
145 |
|
|
128 |
|
|
17 |
|
|
470 |
|
|
592 |
|
|
(122) |
|
Professional and Consulting Fees |
|
|
289 |
|
|
870 |
|
|
(581) |
|
|
1,125 |
|
|
2,198 |
|
|
(1,073) |
|
Information Technology and Telecommunications |
|
|
258 |
|
|
333 |
|
|
(75) |
|
|
932 |
|
|
671 |
|
|
261 |
|
Marketing and Advertising |
|
|
431 |
|
|
247 |
|
|
184 |
|
|
1,342 |
|
|
983 |
|
|
359 |
|
Intangible Asset Amortization |
|
|
48 |
|
|
48 |
|
|
— |
|
|
191 |
|
|
191 |
|
|
— |
|
Amortization of Tax Credit Investments |
|
|
3,278 |
|
|
1,916 |
|
|
1,362 |
|
|
3,293 |
|
|
1,916 |
|
|
1,377 |
|
Other Expense |
|
|
681 |
|
|
406 |
|
|
275 |
|
|
2,323 |
|
|
1,932 |
|
|
391 |
|
Totals |
|
$ |
11,040 |
|
$ |
8,862 |
|
$ |
2,178 |
|
$ |
31,562 |
|
$ |
25,496 |
|
$ |
6,066 |
While the recognition of tax credit investments elevates the level of operating expenses and concurrently the efficiency ratio, it directly reduces income tax expense and the effective tax rate. Consequently, the efficiency ratio, a non-GAAP financial measure, increased to 60.0% for the fourth quarter of 2018, compared to 56.4% for the fourth quarter of 2017 due to amortization of tax credit investments of $3.3 million and $1.9 million, respectively.
Full-time equivalent employees increased from 114 at the end of the fourth quarter of 2017 to 140 at the end of the fourth quarter of 2018. The increase includes key strategic hires, particularly in deposit gathering roles, as the Company continues to capitalize on M&A disruption in its market area. Despite the increase in salaries and employee benefits related to the 26 new hires, the Company experienced a decrease in the adjusted efficiency ratio, a non-GAAP financial measure, due to favorable operating leverage. The adjusted efficiency ratio, which excludes the impact of the amortization of tax credit investments, decreased slightly to 42.1% for the fourth quarter for 2018 compared to 44.1% for the fourth quarter of 2017.
Income Taxes
The effective combined federal and state income tax rate for the fourth quarter of 2018 was (20.2)%, compared to 37.9% for the fourth
Page 6 of 12
quarter of 2017. The lower effective combined rate was primarily due to the recognition of $3.8 million of tax credit investments and reduction in the federal corporate tax rate from 35% to 21%. For the years ended December 31, 2018 and 2017, the effective combined federal and state income tax rate was 16.3% and 37.5%, respectively.
Balance Sheet
Total assets at December 31, 2018 were $1.97 billion, a 4.7% increase from $1.89 billion at September 30, 2018, and a 22.1% increase from $1.62 billion at December 31, 2017. The increase in total assets was primarily due to organic loan growth.
Total gross loans at December 31, 2018 were $1.66 billion, an increase of $65.0 million, or 4.1%, over total gross loans of $1.60 billion at September 30, 2018, and an increase of $317.8 million, or 23.6%, over total gross loans of $1.35 billion at December 31, 2017.
The following table details the composition of the Company’s loan portfolio, by category, at the dates indicated:
|
|
|
December 31, 2018 |
|
September 30, 2018 |
|
June 30, 2018 |
|
March 31, 2018 |
|
December 31, 2017 |
|
|||||
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and Industrial |
|
$ |
260,833 |
|
$ |
235,502 |
|
$ |
204,072 |
|
$ |
199,262 |
|
$ |
217,753 |
|
|
Construction and Land Development |
|
|
210,041 |
|
|
187,919 |
|
|
164,492 |
|
|
147,842 |
|
|
130,586 |
|
|
Real Estate Mortgage: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 - 4 Family Mortgage |
|
|
226,773 |
|
|
224,124 |
|
|
213,265 |
|
|
200,573 |
|
|
195,707 |
|
|
Multifamily |
|
|
407,934 |
|
|
389,511 |
|
|
340,888 |
|
|
332,770 |
|
|
317,872 |
|
|
CRE Owner Occupied |
|
|
64,458 |
|
|
65,905 |
|
|
65,891 |
|
|
67,512 |
|
|
65,909 |
|
|
CRE Nonowner Occupied |
|
|
490,632 |
|
|
492,499 |
|
|
470,437 |
|
|
453,498 |
|
|
415,034 |
|
|
Total Real Estate Mortgage Loans |
|
|
1,189,797 |
|
|
1,172,039 |
|
|
1,090,481 |
|
|
1,054,353 |
|
|
994,522 |
|
|
Consumer and Other |
|
|
4,260 |
|
|
4,504 |
|
|
4,275 |
|
|
3,963 |
|
|
4,252 |
|
|
Total Loans, Gross |
|
|
1,664,931 |
|
|
1,599,964 |
|
|
1,463,320 |
|
|
1,405,420 |
|
|
1,347,113 |
|
|
Allowance for Loan Losses |
|
|
(20,031) |
|
|
(18,949) |
|
|
(17,666) |
|
|
(17,121) |
|
|
(16,502) |
|
|
Net Deferred Loan Fees |
|
|
(4,515) |
|
|
(4,308) |
|
|
(4,058) |
|
|
(4,130) |
|
|
(4,104) |
|
|
Total Loans, Net |
|
$ |
1,640,385 |
|
$ |
1,576,707 |
|
$ |
1,441,596 |
|
$ |
1,384,169 |
|
$ |
1,326,507 |
|
Total deposits at December 31, 2018 were $1.56 billion, an increase of $81.8 million, or 5.5%, over total deposits of $1.48 billion at September 30, 2018, and an increase of $221.6 million, or 16.5%, over total deposits of $1.34 billion at December 31, 2017.
The following table details the composition of the Company’s deposit portfolio, by category, at the dates indicated:
|
|
|
December 31, 2018 |
|
September 30, 2018 |
|
June 30, 2018 |
|
March 31, 2018 |
|
December 31, 2017 |
|
|
|||||
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest Bearing Transaction Deposits |
|
$ |
369,203 |
|
$ |
342,292 |
|
$ |
323,320 |
|
$ |
315,036 |
|
$ |
292,539 |
|
|
|
Interest Bearing Transaction Deposits |
|
|
179,567 |
|
|
175,455 |
|
|
178,045 |
|
|
164,899 |
|
|
177,292 |
|
|
|
Savings and Money Market Deposits |
|
|
402,639 |
|
|
416,140 |
|
|
381,942 |
|
|
339,541 |
|
|
369,942 |
|
|
|
Time Deposits |
|
|
318,356 |
|
|
290,887 |
|
|
300,701 |
|
|
304,743 |
|
|
292,096 |
|
|
|
Brokered Deposits |
|
|
291,169 |
|
|
254,314 |
|
|
230,683 |
|
|
228,817 |
|
|
207,481 |
|
|
|
Total Deposits |
|
$ |
1,560,934 |
|
$ |
1,479,088 |
|
$ |
1,414,691 |
|
$ |
1,353,036 |
|
$ |
1,339,350 |
|
|
Total shareholders’ equity at December 31, 2018 was $221.0 million, an increase of $10.1 million, or 4.8%, over total shareholders’ equity of $210.9 million at September 30, 2018, and an increase of $83.8 million, or 61.1%, over total shareholders’ equity of $137.2 million at December 31, 2017. The increase in total shareholders’ equity for the three months ended December 31, 2018 compared to September 30, 2018, was primarily due to net income retained. The increase in total shareholders’ equity for the year ended December 31, 2018 compared to December 31, 2017, was primarily due to capital raised in the Company’s initial public offering.
Tangible book value per share, a non-GAAP financial measure, increased 33.7%, from $5.40 as of December 31, 2017 to $7.22 as of December 31, 2018.
Asset Quality
Asset quality metrics for the Company remained strong at December 31, 2018. Annualized net charge-offs (recoveries) as a percent of average loans for the fourth quarter of 2018 were (0.07)%, compared to 0.00% for the third quarter of 2018, and (0.03)% for the fourth quarter of 2017. At December 31, 2018, the Company’s nonperforming assets, which include nonaccrual loans and other real estate owned, were $581,000, or 0.03% of total assets, as compared to $718,000, or 0.04% of total assets at September 30, 2018, and $1.7 million, or 0.11% of total assets at December 31, 2017.
Page 7 of 12
About the Company
Bridgewater Bancshares, Inc. is a financial holding company headquartered in Bloomington, Minnesota. The Company has two wholly owned subsidiaries, Bridgewater Bank, a Minnesota-chartered commercial bank founded in November 2005, and Bridgewater Risk Management, Inc., a captive insurance company founded in December 2016. Bridgewater Bank has two wholly owned subsidiaries, Bridgewater Investment Management, Inc. and BWB Holdings, LLC. Bridgewater Bank currently operates through 7 branches in Bloomington, Greenwood, Minneapolis (2), St. Louis Park, Orono, and St. Paul, all located within the Minneapolis-St. Paul-Bloomington metropolitan statistical area.
Investor Relations Contact:
Jerry Baack
Chief Executive Officer
investorrelations@bwbmn.com
952-893-6866
Use of Non-GAAP financial measures
In addition to the results presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP), the Company routinely supplements its evaluation with an analysis of certain non-GAAP financial measures. The Company believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors to help them understand the Company’s operating performance and trends, and to facilitate comparisons with the performance of peers. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of non-GAAP disclosures used in this earnings release to the comparable GAAP measures are provided in the accompanying tables.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, identified by words such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized”, “target” and “outlook”, or the negative version of those words or other comparable words of a future or forward-looking nature. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: loan concentrations in our portfolio; the overall health of the local and national real estate market; our ability to successfully manage credit risk; business and economic conditions generally and in the financial services industry, nationally and within our market area; our ability to maintain an adequate level of allowance for loan losses; our high concentration of large loans to certain borrowers; our ability to successfully manage liquidity risk; our dependence on non-core funding sources and our cost of funds; our ability to raise additional capital to implement our business plan; our ability to implement our growth strategy and manage costs effectively; the composition of our senior leadership team and our ability to attract and retain key personnel; the occurrence of fraudulent activity, breaches or failures of our information security controls or cybersecurity-related incidents; interruptions involving our information technology and telecommunications systems or third-party servicers; competition in the financial services industry; the effectiveness of our risk management framework; the commencement and outcome of litigation and other legal proceedings and regulatory actions against us; the impact of recent and future legislative and regulatory changes; interest rate risk; fluctuations in the values of the securities held in our securities portfolio; the imposition of tariffs or other governmental policies impacting the value of products produced by our commercial borrowers; and any other risks described in the “Risk Factors” sections of other reports filed by the Company with the Securities and Exchange Commission. Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
Page 8 of 12
Bridgewater Bancshares, Inc. and Subsidiaries
Consolidated Balance Sheets
(dollars in thousands, except share data)
|
|
|
December 31, |
|
December 31, |
||
|
|
|
2018 |
|
2017 |
||
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
Cash and Cash Equivalents |
|
$ |
28,444 |
|
$ |
23,725 |
|
Bank-owned Certificates of Deposits |
|
|
3,305 |
|
|
3,072 |
|
Securities Available for Sale, at Fair Value |
|
|
253,378 |
|
|
229,491 |
|
Loans, Net of Allowance for Loan Losses of $20,031 at December 31, 2018 and $16,502 at December 31, 2017 |
|
|
1,640,385 |
|
|
1,326,507 |
|
Federal Home Loan Bank (FHLB) Stock, at Cost |
|
|
7,614 |
|
|
5,147 |
|
Premises and Equipment, Net |
|
|
13,074 |
|
|
10,115 |
|
Foreclosed Assets |
|
|
— |
|
|
581 |
|
Accrued Interest |
|
|
6,589 |
|
|
5,342 |
|
Goodwill |
|
|
2,626 |
|
|
2,626 |
|
Other Intangible Assets, Net |
|
|
1,052 |
|
|
1,243 |
|
Other Assets |
|
|
17,274 |
|
|
8,763 |
|
Total Assets |
|
$ |
1,973,741 |
|
$ |
1,616,612 |
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
Noninterest Bearing |
|
$ |
369,203 |
|
$ |
292,539 |
|
Interest Bearing |
|
|
1,191,731 |
|
|
1,046,811 |
|
Total Deposits |
|
|
1,560,934 |
|
|
1,339,350 |
|
Federal Funds Purchased |
|
|
18,000 |
|
|
23,000 |
|
Notes Payable |
|
|
15,000 |
|
|
17,000 |
|
FHLB Advances |
|
|
124,000 |
|
|
68,000 |
|
Subordinated Debentures, Net of Issuance Costs |
|
|
24,630 |
|
|
24,527 |
|
Accrued Interest Payable |
|
|
1,806 |
|
|
1,408 |
|
Other Liabilities |
|
|
8,373 |
|
|
6,165 |
|
Total Liabilities |
|
|
1,752,743 |
|
|
1,479,450 |
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
Preferred Stock- $0.01 par value |
|
|
|
|
|
|
|
Authorized 10,000,000; None Issued and Outstanding at December 31, 2018 and December 31, 2017 |
|
|
— |
|
|
— |
|
Common Stock- $0.01 par value |
|
|
|
|
|
|
|
Common Stock - Authorized 75,000,000; Issued and Outstanding 30,097,274 at December 31, 2018 and 20,834,001 at December 31, 2017 |
|
|
301 |
|
|
208 |
|
Non-voting Common Stock- Authorized 10,000,000; Issued and Outstanding -0- at December 31, 2018 and 3,845,860 at December 31, 2017 |
|
|
— |
|
|
38 |
|
Additional Paid-In Capital |
|
|
126,031 |
|
|
66,324 |
|
Retained Earnings |
|
|
96,234 |
|
|
69,508 |
|
Accumulated Other Comprehensive Income (Loss) |
|
|
(1,568) |
|
|
1,084 |
|
Total Shareholders' Equity |
|
|
220,998 |
|
|
137,162 |
|
Total Liabilities and Equity |
|
$ |
1,973,741 |
|
$ |
1,616,612 |
Page 9 of 12
Bridgewater Bancshares, Inc. and Subsidiaries
Consolidated Statements of Income
(dollars in thousands, except per share data)
|
|
|
Three Months Ended |
|
Year Ended |
||||||||
|
|
|
December 31, |
|
December 31, |
||||||||
|
|
|
2018 |
|
2017 |
|
2018 |
|
2017 |
||||
|
INTEREST INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, Including Fees |
|
$ |
21,978 |
|
$ |
16,964 |
|
$ |
78,033 |
|
$ |
60,024 |
|
Investment Securities |
|
|
1,864 |
|
|
1,537 |
|
|
6,694 |
|
|
5,981 |
|
Other |
|
|
146 |
|
|
75 |
|
|
499 |
|
|
341 |
|
Total Interest Income |
|
|
23,988 |
|
|
18,576 |
|
|
85,226 |
|
|
66,346 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
5,119 |
|
|
2,822 |
|
|
15,972 |
|
|
9,719 |
|
Notes Payable |
|
|
152 |
|
|
159 |
|
|
594 |
|
|
656 |
|
FHLB Advances |
|
|
559 |
|
|
295 |
|
|
1,718 |
|
|
880 |
|
Subordinated Debentures |
|
|
401 |
|
|
401 |
|
|
1,568 |
|
|
749 |
|
Federal Funds Purchased |
|
|
315 |
|
|
50 |
|
|
636 |
|
|
169 |
|
Total Interest Expense |
|
|
6,546 |
|
|
3,727 |
|
|
20,488 |
|
|
12,173 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST INCOME |
|
|
17,442 |
|
|
14,849 |
|
|
64,738 |
|
|
54,173 |
|
Provision for Loan Losses |
|
|
800 |
|
|
1,200 |
|
|
3,575 |
|
|
4,175 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST INCOME AFTER |
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION FOR LOAN LOSSES |
|
|
16,642 |
|
|
13,649 |
|
|
61,163 |
|
|
49,998 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NONINTEREST INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer Service Fees |
|
|
206 |
|
|
177 |
|
|
745 |
|
|
660 |
|
Net Gain (Loss) on Sales of Available for Sale Securities |
|
|
(17) |
|
|
(199) |
|
|
(125) |
|
|
(250) |
|
Net Gain (Loss) on Sales of Foreclosed Assets |
|
|
— |
|
|
4 |
|
|
(225) |
|
|
356 |
|
Other Income |
|
|
668 |
|
|
601 |
|
|
2,148 |
|
|
1,770 |
|
Total Noninterest Income |
|
|
857 |
|
|
583 |
|
|
2,543 |
|
|
2,536 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NONINTEREST EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and Employee Benefits |
|
|
5,086 |
|
|
4,106 |
|
|
18,620 |
|
|
14,051 |
|
Occupancy and Equipment |
|
|
584 |
|
|
563 |
|
|
2,351 |
|
|
2,192 |
|
Other Expense |
|
|
5,370 |
|
|
4,193 |
|
|
10,591 |
|
|
9,253 |
|
Total Noninterest Expense |
|
|
11,040 |
|
|
8,862 |
|
|
31,562 |
|
|
25,496 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME BEFORE INCOME TAXES |
|
|
6,459 |
|
|
5,370 |
|
|
32,144 |
|
|
27,038 |
|
Provision (Benefit) for Income Taxes |
|
|
(1,302) |
|
|
2,036 |
|
|
5,224 |
|
|
10,149 |
|
NET INCOME |
|
$ |
7,761 |
|
$ |
3,334 |
|
$ |
26,920 |
|
$ |
16,889 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.26 |
|
$ |
0.14 |
|
$ |
0.93 |
|
$ |
0.69 |
|
Diluted |
|
|
0.25 |
|
|
0.13 |
|
|
0.91 |
|
|
0.68 |
|
Dividends Paid Per Share |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
Page 10 of 12
Bridgewater Bancshares, Inc. and Subsidiaries
Summary Quarterly Consolidated Financial Data
(dollars in thousands)
|
|
|
As of and for the Three Months Ended |
|
|||||||
|
|
|
December 31, |
|
September 30, |
|
December 31, |
|
|||
|
|
|
2018 |
|
2018 |
|
2017 |
|
|||
|
Selected Asset Quality Data |
|
|
|
|
|
|
|
|
|
|
|
Loans 30-89 Days Past Due |
|
$ |
311 |
|
$ |
12 |
|
$ |
664 |
|
|
Loans 30-89 Days Past Due to Total Loans |
|
|
0.02 |
% |
|
0.00 |
% |
|
0.05 |
% |
|
Nonperforming Loans |
|
$ |
581 |
|
$ |
718 |
|
$ |
1,139 |
|
|
Nonperforming Loans to Total Loans |
|
|
0.03 |
% |
|
0.04 |
% |
|
0.08 |
% |
|
Foreclosed Assets |
|
$ |
— |
|
$ |
— |
|
$ |
581 |
|
|
Nonaccrual Loans to Total Loans |
|
|
0.03 |
% |
|
0.04 |
% |
|
0.08 |
% |
|
Nonaccrual Loans and Loans Past Due 90 Days and Still Accruing to Total Loans |
|
|
0.03 |
|
|
0.04 |
|
|
0.08 |
|
|
Nonperforming Assets (1) |
|
$ |
581 |
|
$ |
718 |
|
$ |
1,720 |
|
|
Nonperforming Assets to Total Assets (1) |
|
|
0.03 |
% |
|
0.04 |
% |
|
0.11 |
% |
|
Allowance for Loan Losses to Total Loans |
|
|
1.20 |
|
|
1.18 |
|
|
1.22 |
|
|
Allowance for Loans Losses to Nonperforming Loans |
|
|
3,447.68 |
|
|
2,639.14 |
|
|
1,448.81 |
|
|
Net Loan Charge-Offs (Recoveries) (Annualized) to Average Loans |
|
|
(0.07) |
|
|
0.00 |
|
|
(0.03) |
|
|
(1) |
Nonperforming assets are defined as nonaccrual loans plus loans 90 days past due plus foreclosed assets. |
Non-GAAP Financial Measures
|
|
|
As of and for the Three Months Ended |
|
|
As of and for the Year Ended |
|
||||||||
|
|
|
December 31, |
|
December 31, |
|
|
December 31, |
|
December 31, |
|
||||
|
|
|
2018 |
|
2017 |
|
|
2018 |
|
2017 |
|
||||
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency Ratio |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest Expense |
|
$ |
11,040 |
|
$ |
8,862 |
|
|
$ |
31,562 |
|
$ |
25,496 |
|
|
Less: Amortization of Intangible Assets |
|
|
(48) |
|
|
(48) |
|
|
|
(191) |
|
|
(191) |
|
|
Adjusted Noninterest Expense |
|
$ |
10,992 |
|
$ |
8,814 |
|
|
$ |
31,371 |
|
$ |
25,305 |
|
|
Net Interest Income |
|
|
17,442 |
|
|
14,849 |
|
|
|
64,738 |
|
|
54,173 |
|
|
Noninterest Income |
|
|
857 |
|
|
583 |
|
|
|
2,543 |
|
|
2,536 |
|
|
Less: (Gain) Loss on Sales of Securities |
|
|
17 |
|
|
199 |
|
|
|
125 |
|
|
250 |
|
|
Adjusted Operating Revenue |
|
$ |
18,316 |
|
$ |
15,631 |
|
|
$ |
67,406 |
|
$ |
56,959 |
|
|
Efficiency Ratio |
|
|
60.0 |
% |
|
56.4 |
% |
|
|
46.5 |
% |
|
44.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Efficiency Ratio |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest Expense |
|
$ |
11,040 |
|
$ |
8,862 |
|
|
$ |
31,562 |
|
$ |
25,496 |
|
|
Less: Amortization of Tax Credit Investments |
|
|
(3,278) |
|
|
(1,916) |
|
|
|
(3,293) |
|
|
(1,916) |
|
|
Less: Amortization of Intangible Assets |
|
|
(48) |
|
|
(48) |
|
|
|
(191) |
|
|
(191) |
|
|
Adjusted Noninterest Expense |
|
$ |
7,714 |
|
$ |
6,898 |
|
|
$ |
28,078 |
|
$ |
23,389 |
|
|
Net Interest Income |
|
|
17,442 |
|
|
14,849 |
|
|
|
64,738 |
|
|
54,173 |
|
|
Noninterest Income |
|
|
857 |
|
|
583 |
|
|
|
2,543 |
|
|
2,536 |
|
|
Less: (Gain) Loss on Sales of Securities |
|
|
17 |
|
|
199 |
|
|
|
125 |
|
|
250 |
|
|
Adjusted Operating Revenue |
|
$ |
18,316 |
|
$ |
15,631 |
|
|
$ |
67,406 |
|
$ |
56,959 |
|
|
Adjusted Efficiency Ratio |
|
|
42.1 |
% |
|
44.1 |
% |
|
|
41.7 |
% |
|
41.1 |
% |
Page 11 of 12
|
|
|
As of and for the Three Months Ended |
|
|
As of and for the Year Ended |
|
||||||||
|
|
|
December 31, |
|
December 31, |
|
|
December 31, |
|
December 31, |
|
||||
|
|
|
2018 |
|
2017 |
|
|
2018 |
|
2017 |
|
||||
|
(dollars in thousands, except share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible Common Equity and Tangible Common Equity/Tangible Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Equity |
|
$ |
220,998 |
|
$ |
137,162 |
|
|
|
|
|
|
|
|
|
Less: Intangible Assets |
|
|
(3,678) |
|
|
(3,869) |
|
|
|
|
|
|
|
|
|
Tangible Common Equity |
|
|
217,320 |
|
|
133,293 |
|
|
|
|
|
|
|
|
|
Total Assets |
|
|
1,973,741 |
|
|
1,616,612 |
|
|
|
|
|
|
|
|
|
Less: Intangible Assets |
|
|
(3,678) |
|
|
(3,869) |
|
|
|
|
|
|
|
|
|
Tangible Assets |
|
$ |
1,970,063 |
|
$ |
1,612,743 |
|
|
|
|
|
|
|
|
|
Tangible Common Equity/Tangible Assets |
|
|
11.03 |
% |
|
8.26 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible Book Value Per Share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book Value Per Common Share |
|
$ |
7.34 |
|
$ |
5.56 |
|
|
|
|
|
|
|
|
|
Less: Effects of Intangible Assets |
|
|
(0.12) |
|
|
(0.16) |
|
|
|
|
|
|
|
|
|
Tangible Book Value Per Common Share |
|
$ |
7.22 |
|
$ |
5.40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Tangible Common Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Common Equity |
|
$ |
215,254 |
|
$ |
135,875 |
|
|
$ |
194,083 |
|
$ |
128,123 |
|
|
Less: Effects of Average Intangible Assets |
|
|
(3,701) |
|
|
(3,885) |
|
|
|
(3,772) |
|
|
(3,956) |
|
|
Average Tangible Common Equity |
|
$ |
211,553 |
|
$ |
131,990 |
|
|
$ |
190,311 |
|
$ |
124,167 |
|
Page 12 of 12