BELMONT, Mass., July 20, 2017 /PRNewswire/ -- BSB Bancorp, Inc.
(NASDAQ: BLMT) (the "Company"), the holding company for Belmont
Savings Bank (the "Bank"), a state-chartered savings bank
headquartered in Belmont,
Massachusetts, today reported a 35.9% increase in net income
to $4.01 million or $0.43 per diluted share for the quarter ended
June 30, 2017 compared to net income of $2.95 million or $0.33 per diluted share for the quarter ended
June 30, 2016. This is the Bank's
16th consecutive quarter of earnings growth. For the six months
ended June 30, 2017, the Company
reported net income of $7.68 million
or $0.83 per diluted share as
compared to net income of $5.49
million or $0.61 per diluted
share for the six months ended June 30,
2016 or an increase in net income of 39.8%.
Robert M. Mahoney, President and
Chief Executive Officer, said, "Strong loan demand, good fee
income, expense control and credit quality combined to produce very
solid quarterly results."
NET INTEREST AND DIVIDEND INCOME
Net interest and dividend income before provision for loan
losses for the quarter ended June 30,
2017 was $13.95 million as
compared to $11.71 million for the
quarter ended June 30, 2016 or a
19.1% increase. The provision for loan losses for the quarter ended
June 30, 2017 was $707,000 as compared to $741,000 for the quarter ended June 30, 2016 or a 4.6% decrease. This resulted
in an increase of $2.28 million or
20.7% in net interest and dividend income after provision for loan
losses for the quarter ended June 30,
2017 as compared to the quarter ended June 30, 2016. Net interest and dividend income
before provision for loan losses for the six months ended
June 30, 2017 was $27.21 million as compared to $22.99 million for the six months ended
June 30, 2016 or an 18.4% increase.
The provision for loan losses for the six months ended June 30, 2017 was $1.54
million as compared to $1.34
million for the six months ended June
30, 2016 or a 14.6% increase. This resulted in an increase
of $4.02 million or 18.6% in net
interest and dividend income after provision for loan losses for
the six months ended June 30, 2017 as
compared to the six months ended June 30,
2016.
NONINTEREST INCOME
Noninterest income for the quarter ended June 30, 2017 was $995,000 as compared to $705,000 for the quarter ended June 30, 2016 or an increase of 41.1%.
- Customer service fees decreased $25,000 or 11.2% primarily due to declines in NSF
and other fees.
- Income from bank owned life insurance increased $57,000 or 24.1% primarily due to a purchase of
$5.00 million in additional bank
owned life insurance policies at the end of the second quarter of
2016.
- Net gains on sales of loans increased $232,000 or 218.9% due to an increase in the
number of units sold.
- Other income increased by $17,000
or 37.0% primarily due to increases in the values of investments
held in a Rabbi Trust. Investments held in the Rabbi Trust are used
to fund the executive and director non-qualified deferred
compensation plan. Corresponding deferred compensation expense is
recorded within director compensation and salaries and employee
benefits.
Noninterest income for the six months ended June 30, 2017 was $1.63
million as compared to $1.37
million for the six months ended June
30, 2016 or an increase of 18.9%.
- Customer service fees decreased $68,000 or 15.1% primarily due to declines in NSF
and other fees.
- Income from bank owned life insurance increased $76,000 or 16.2% primarily due to a purchase of
$5.00 million in additional bank
owned life insurance policies at the end of the second quarter of
2016.
- Net gains on sales of loans increased $180,000 or 107.8% due to an increase in the
number of units sold.
- Other income increased by $58,000
or 77.3% primarily due to increases in the values of investments
held in a Rabbi Trust. Investments held in the Rabbi Trust are used
to fund the executive and director non-qualified deferred
compensation plan. Corresponding deferred compensation expense is
recorded within director compensation and salaries and employee
benefits.
NONINTEREST EXPENSE
Noninterest expense for the quarter ended June 30, 2017 was $7.65
million as compared to $6.98
million for the quarter ended June
30, 2016 or an increase of 9.5%.
- Salaries and employee benefits increased $444,000 or 10.2% primarily driven by stock based
compensation related to grants made during the first quarter of
2017 and a slight increase in the number of employees.
- Director compensation increased $109,000 or 44.1% primarily driven by stock based
compensation related to grants made during the first quarter of
2017.
- Deposit insurance expense increased by $129,000 or 44.9% primarily driven by asset
growth and the FDIC's new assessment methodology that was first
effective for the quarter ended September
30, 2016.
- Data processing fees decreased by $185,000 or 21.0% as we renegotiated certain
contracts with service providers in late 2016.
- Professional fees increased by $83,000 or 44.4% primarily due to the timing of
certain annual audit engagements as well as increased attorney and
consultant fees.
- Marketing costs increased by $75,000, or 36.1% primarily due to an increase in
digital promotion of our market leading consumer lending products
as well as additional support for our business banking segment
strategy.
Noninterest expense for the six months ended June 30, 2017 was $15.12
million as compared to $14.24
million for the six months ended June
30, 2016 or an increase of 6.2%.
- Director compensation increased $178,000 or 37.0% primarily driven by stock based
compensation related to grants made during the first quarter of
2017.
- Deposit insurance expense increased by $251,000 or 44.3% primarily driven by asset
growth and the FDIC's new assessment methodology that was first
effective for the quarter ended September
30, 2016.
- Data processing fees decreased by $373,000 or 21.2% as we renegotiated certain
contracts with service providers in late 2016.
- Professional fees increased by $136,000 or 32.2% primarily due to the timing of
certain annual audit engagements as well as increased attorney and
consultant fees.
- Marketing costs increased by $132,000, or 30.8% primarily due to an increase
in digital promotion of our market leading consumer lending
products as well as additional support for our business banking
segment strategy.
Our efficiency ratio improved to 51.2% for the quarter ended
June 30, 2017 from 56.3% for the
quarter ended June 30, 2016 and to
52.4% for the six months ended June 30,
2017 from 58.5% for the six months ended June 30, 2016 as we continue to grow the balance
sheet and manage costs. A talented and committed colleague team
along with continued operational enhancements have contributed to
the improvement in our efficiency ratio.
INCOME TAXES
We recorded a provision for income taxes of $2.60 million for the quarter ended
June 30, 2017, compared to a provision for income taxes of
$1.74 million for the quarter
ended June 30, 2016, reflecting effective tax rates of 39.1%
and 37.0%, respectively. We recorded a provision for income taxes
of $4.50 million for the six
months ended June 30, 2017, compared to a provision for income
taxes of $3.29 million for the
six months ended June 30, 2016, reflecting effective tax rates
of 37.0% and 37.4%, respectively.
BALANCE SHEET
At June 30, 2017, total assets
were $2.37 billion, an increase of
$212.18 million or 9.8% from
$2.16 billion at December 31, 2016. The Company experienced net
loan growth of $201.55 million or
10.8% from December 31, 2016 to June
30, 2017. 1-4 family residential real estate loans and
commercial real estate loans increased by $162.27 million and $66.98
million, respectively. Partially offsetting these increases
was a decrease in indirect auto loans of $17.29 million, driven by the suspension of new
originations due to current market conditions. The asset growth was
primarily funded by growth in deposits and federal home loan bank
advances.
At June 30, 2017, deposits totaled $1.61 billion, an increase of $141.39 million or 9.6% from $1.47 billion at December 31, 2016. Core
deposits, which we consider to include all deposits other than CDs,
increased by $62.93 million from
$1.13 billion at December 31, 2016 to $1.20
billion at June 30, 2017.
Hal R. Tovin, Executive Vice
President and Chief Operating Officer, said "Our competitive retail
product offerings, the ongoing commitment to our targeted business
segment strategy and our focus on commercial relationship expansion
have contributed to our strong deposit growth."
Total stockholders' equity increased by $8.90 million from $160.92
million as of December 31,
2016 to $169.83 million as of
June 30, 2017. This increase is
primarily the result of earnings of $7.68
million and a $1.08 million
increase in additional paid-in capital related to stock-based
compensation.
ASSET QUALITY
Asset quality remains strong. The allowance for loan losses in
total and as a percentage of total loans as of June 30, 2017 was $15.09 million and 0.73%, respectively, as
compared to $13.59 million and
0.73%, respectively, as of December 31, 2016. For the
six months ended June 30, 2017, the
Company recorded net charge offs of $32,000, as compared to net charge offs of
$37,000 for the six months ended
June 30, 2016. Total non-performing
assets were $1.70 million or 0.07% of
total assets as of June 30, 2017 as
compared to $1.82 million or 0.08% of
total assets as of December 31,
2016.
Company Profile
BSB Bancorp, Inc. is headquartered in Belmont, Massachusetts and is the holding
company for Belmont Savings Bank. The Bank provides financial
services to individuals, families, municipalities and businesses
through its six full-service branch offices located in Belmont, Watertown, Cambridge, Newton and Waltham in Southeast
Middlesex County, Massachusetts. The Bank's primary lending
market includes Essex,
Middlesex, Norfolk and Suffolk Counties, Massachusetts. The Company's common stock is
traded on the NASDAQ Capital Market under the symbol "BLMT." For
more information, visit the Company's website at
www.belmontsavings.com.
Forward-looking statements
Certain statements herein constitute "forward-looking
statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, as amended. These statements are based on the
beliefs and expectations of management, as well as the assumptions
made using information currently available to management. Since
these statements reflect the views of management concerning future
events, these statements involve risks, uncertainties and
assumptions. As a result, actual results may differ from those
contemplated by these statements. Forward-looking statements can be
identified by the fact that they do not relate strictly to
historical or current facts. They often include words like
"believe," "expect," "anticipate," "estimate," and "intend" or
future or conditional verbs such as "will," "would," "should,"
"could" or "may." Certain factors that could cause actual results
to differ materially from expected results include changes in the
interest rate environment, changes in general economic conditions,
our ability to continue to increase loans and deposit growth,
legislative and regulatory changes that adversely affect the
businesses in which the Company is engaged, changes in the
securities market, and other factors that are described in the
Company's annual report on Form 10-K and quarterly reports on Form
10-Q as filed with the Securities and Exchange Commission. Readers
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this release. The
Company disclaims any intent or obligation to update any
forward-looking statements, whether in response to new information,
future events or otherwise, except as may be required by
law.
BSB BANCORP, INC.
AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
(Dollars in
thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2017
|
|
December 31,
2016
|
|
|
|
|
|
(unaudited)
|
|
|
ASSETS
|
|
|
|
|
Cash and due from
banks
|
|
$
2,041
|
|
$
2,211
|
Interest-bearing
deposits in other banks
|
|
50,000
|
|
56,665
|
|
|
|
Cash and cash
equivalents
|
|
52,041
|
|
58,876
|
Interest-bearing time
deposits with other banks
|
|
235
|
|
234
|
Investments in
available-for-sale securities
|
|
22,118
|
|
22,048
|
Investments in
held-to-maturity securities (fair value of $139,952 as
of
|
|
|
|
|
|
|
June 30, 2017 and
$129,465 as of December 31, 2016)
|
|
140,524
|
|
130,197
|
Federal Home Loan
Bank stock, at cost
|
|
30,428
|
|
25,071
|
Loans, net of
allowance for loan losses of $15,089 as of
|
|
|
|
|
|
|
June 30, 2017 and
$13,585 as of December 31, 2016
|
|
2,067,584
|
|
1,866,035
|
Premises and
equipment, net
|
|
2,333
|
|
2,355
|
Accrued interest
receivable
|
|
5,115
|
|
4,635
|
Deferred tax asset,
net
|
|
7,918
|
|
8,321
|
Income taxes
receivable
|
|
1,033
|
|
423
|
Bank-owned life
insurance
|
|
36,393
|
|
35,842
|
Other
assets
|
|
5,159
|
|
4,667
|
|
|
|
Total
assets
|
|
$
2,370,881
|
|
$
2,158,704
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
Noninterest-bearing
|
|
$
203,711
|
|
$
208,082
|
|
|
Interest-bearing
|
|
1,407,104
|
|
1,261,340
|
|
|
|
Total
deposits
|
|
1,610,815
|
|
1,469,422
|
Federal Home Loan
Bank advances
|
|
567,250
|
|
508,850
|
Securities sold under
agreements to repurchase
|
|
3,030
|
|
1,985
|
Accrued interest
payable
|
|
1,293
|
|
1,023
|
Deferred compensation
liability
|
|
7,464
|
|
7,043
|
Other
liabilities
|
|
11,204
|
|
9,460
|
|
|
|
Total
liabilities
|
|
2,201,056
|
|
1,997,783
|
Stockholders'
Equity:
|
|
|
|
|
|
Common stock; $0.01
par value per share, 100,000,000 shares authorized; 9,694,260 and
9,110,077
|
|
|
|
|
shares issued and
outstanding at June 30, 2017 and December 31, 2016,
respectively
|
|
97
|
|
91
|
|
Additional paid-in
capital
|
|
93,092
|
|
92,013
|
|
Retained
earnings
|
|
80,176
|
|
72,498
|
|
Accumulated other
comprehensive income
|
|
167
|
|
103
|
|
Unearned compensation
- ESOP
|
|
(3,707)
|
|
(3,784)
|
|
|
|
Total stockholders'
equity
|
|
169,825
|
|
160,921
|
|
|
|
Total liabilities and
stockholders' equity
|
|
$
2,370,881
|
|
$
2,158,704
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Quality
Data:
|
|
|
|
|
Total non-performing
assets
|
|
$
1,702
|
|
$
1,822
|
Total non-performing
loans
|
|
$
1,656
|
|
$
1,819
|
Non-performing loans
to total loans
|
|
0.08%
|
|
0.10%
|
Non-performing assets
to total assets
|
|
0.07%
|
|
0.08%
|
Allowance for loan
losses to non-performing loans
|
|
911.17%
|
|
746.84%
|
Allowance for loan
losses to total loans
|
|
0.73%
|
|
0.73%
|
|
|
|
|
|
|
|
|
Share
Data:
|
|
|
|
|
Outstanding common
shares
|
|
9,694,260
|
|
9,110,077
|
Book value per
share
|
|
$
17.52
|
|
$
17.66
|
|
|
|
|
|
|
|
|
Consolidated Capital
Ratios:
|
|
|
|
|
|
Common Equity Tier 1
Risk-Based Capital Ratio
|
|
10.57%
|
|
10.80%
|
|
Tier 1 Risk-Based
Capital Ratio
|
|
10.57%
|
|
10.80%
|
|
Total Risk-Based
Capital Ratio
|
|
11.51%
|
|
11.72%
|
|
Leverage
Ratio
|
|
7.32%
|
|
7.63%
|
BSB BANCORP, INC.
AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS
(Dollars in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
June 30,
|
|
|
|
|
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
Interest and dividend
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
|
|
|
$
17,508
|
|
$
14,138
|
|
$
33,895
|
|
$
27,550
|
|
Interest on taxable
debt securities
|
|
|
|
|
855
|
|
801
|
|
1,634
|
|
1,629
|
|
Dividends
|
|
|
|
|
290
|
|
186
|
|
546
|
|
341
|
|
Other interest
income
|
|
|
|
|
111
|
|
39
|
|
195
|
|
84
|
|
|
|
Total interest and
dividend income
|
|
|
|
|
18,764
|
|
15,164
|
|
36,270
|
|
29,604
|
Interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
|
|
|
2,988
|
|
2,348
|
|
5,601
|
|
4,472
|
|
Interest on Federal
Home Loan Bank advances
|
|
|
|
|
1,827
|
|
1,108
|
|
3,458
|
|
2,135
|
|
Interest on
securities sold under agreements to repurchase
|
|
|
|
|
1
|
|
1
|
|
2
|
|
2
|
|
Interest on other
borrowed funds
|
|
|
|
|
-
|
|
-
|
|
-
|
|
5
|
|
|
|
Total interest
expense
|
|
|
|
|
4,816
|
|
3,457
|
|
9,061
|
|
6,614
|
|
|
|
Net interest and
dividend income
|
|
|
|
|
13,948
|
|
11,707
|
|
27,209
|
|
22,990
|
Provision for loan
losses
|
|
|
|
|
707
|
|
741
|
|
1,536
|
|
1,340
|
|
|
|
Net interest and
dividend income after provision
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for loan
losses
|
|
|
|
|
13,241
|
|
10,966
|
|
25,673
|
|
21,650
|
Noninterest
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer service
fees
|
|
|
|
|
199
|
|
224
|
|
382
|
|
450
|
|
Income from
bank-owned life insurance
|
|
|
|
|
294
|
|
237
|
|
546
|
|
470
|
|
Net gain on sales of
loans
|
|
|
|
|
338
|
|
106
|
|
347
|
|
167
|
|
Loan servicing fee
income
|
|
|
|
|
101
|
|
92
|
|
217
|
|
205
|
|
Other
income
|
|
|
|
|
63
|
|
46
|
|
133
|
|
75
|
|
|
|
Total noninterest
income
|
|
|
|
|
995
|
|
705
|
|
1,625
|
|
1,367
|
Noninterest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
|
|
4,803
|
|
4,359
|
|
9,474
|
|
8,959
|
|
Director
compensation
|
|
|
|
|
356
|
|
247
|
|
659
|
|
481
|
|
Occupancy
expense
|
|
|
|
|
232
|
|
240
|
|
498
|
|
492
|
|
Equipment
expense
|
|
|
|
|
103
|
|
109
|
|
227
|
|
214
|
|
Deposit
insurance
|
|
|
|
|
416
|
|
287
|
|
818
|
|
567
|
|
Data
processing
|
|
|
|
|
694
|
|
879
|
|
1,388
|
|
1,761
|
|
Professional
fees
|
|
|
|
|
270
|
|
187
|
|
558
|
|
422
|
|
Marketing
|
|
|
|
|
283
|
|
208
|
|
561
|
|
429
|
|
Other
expense
|
|
|
|
|
488
|
|
468
|
|
938
|
|
915
|
|
|
|
Total noninterest
expense
|
|
|
|
|
7,645
|
|
6,984
|
|
15,121
|
|
14,240
|
|
|
|
Income before income
tax expense
|
|
|
|
|
6,591
|
|
4,687
|
|
12,177
|
|
8,777
|
Income tax
expense
|
|
|
|
|
2,579
|
|
1,735
|
|
4,499
|
|
3,286
|
|
|
|
|
Net income
|
|
|
|
|
$
4,012
|
|
$
2,952
|
|
$
7,678
|
|
$
5,491
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
$
0.45
|
|
$
0.34
|
|
$
0.87
|
|
$
0.63
|
|
|
|
|
Diluted
|
|
|
|
|
$
0.43
|
|
$
0.33
|
|
$
0.83
|
|
$
0.61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
|
|
|
0.69%
|
|
0.62%
|
|
0.68%
|
|
0.59%
|
Return on average
equity
|
|
|
|
|
9.56%
|
|
7.81%
|
|
9.32%
|
|
7.35%
|
Interest rate
spread
|
|
|
|
|
2.30%
|
|
2.34%
|
|
2.31%
|
|
2.37%
|
Net interest
margin
|
|
|
|
|
2.44%
|
|
2.49%
|
|
2.45%
|
|
2.51%
|
Efficiency
ratio
|
|
|
|
|
51.16%
|
|
56.27%
|
|
52.44%
|
|
58.46%
|
Contact:
|
|
Robert M.
Mahoney
|
|
|
President and
Chief Executive Officer
|
|
|
|
Phone:
|
|
617-484-6700
|
Email:
|
|
robert.mahoney@belmontsavings.com
|
View original content with
multimedia:http://www.prnewswire.com/news-releases/bsb-bancorp-inc-reports-second-quarter-results--year-over-year-earnings-growth-of-40-300491563.html
SOURCE BSB Bancorp, Inc.