BELMONT, Mass., Oct. 18, 2018 /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 net income of $6.2 million or $0.66 per diluted share for the quarter ended
September 30, 2018 compared to net income of $4.6 million or $0.50 per diluted share for the quarter ended
September 30, 2017 or an increase of 35.4% in net income.
Excluding the one-time impact of the Tax Cuts and Jobs Act ("Tax
Reform Act") in the fourth quarter of 2017, the Bank has attained
21 consecutive quarters of earnings growth. For the nine months
ended September 30, 2018, the Company
reported net income of $18.3 million
or $1.95 per diluted share as
compared to net income of $12.3
million or $1.33 per diluted
share for the nine months ended September
30, 2017 or an increase in net income of 49.1%.
Robert M. Mahoney, President and
Chief Executive Officer, said, "The quarter reflected a
continuation of loan and deposit growth. Importantly, our efforts
to increase fee income through residential loan sales and generate
income from commercial loan interest rate swaps are bearing
fruit."
NET INTEREST AND DIVIDEND INCOME
Net interest and dividend income before provision for loan
losses for the quarter ended September 30,
2018 was $15.4 million as
compared to $14.2 million for the
quarter ended September 30, 2017 or
an 8.7% increase. The provision for loan losses for the quarter
ended September 30, 2018 was
$191,000 as compared to $535,000 for the quarter ended September 30, 2017 or a 64.3% decrease. The
decrease in the provision for loan losses was driven by lower loan
growth for the quarter ended September 30,
2018 as compared to the quarter ended September 30, 2017. The combination of these
items resulted in an increase of $1.6
million or 11.5% in net interest and dividend income after
provision for loan losses for the quarter ended September 30, 2018 as compared to the quarter
ended September 30, 2017.
Net interest and dividend income before provision for loan
losses for the nine months ended September
30, 2018 was $45.7 million as
compared to $41.4 million for the
nine months ended September 30, 2017
or a 10.3% increase. The provision for loan losses for the nine
months ended September 30, 2018 was
$1.2 million as compared to
$2.1 million for the nine months
ended September 30, 2017 or a 42.4%
decrease. The decrease in the provision for loan losses was driven
by improvements in the factors used to estimate the allowance for
loan losses as well as the elimination of the specific reserve on
an impaired loan that was sold. The combination of these items
resulted in an increase of $5.1
million or 13.1% in net interest and dividend income after
provision for loan losses for the nine months ended September 30, 2018 as compared to the nine months
ended September 30, 2017.
NONINTEREST INCOME
Noninterest income for the quarter ended September 30, 2018 was $1.1 million as compared to $885,000 for the quarter ended September 30, 2017 or an increase of 28.4%. This
increase was driven by $126,000 in
fee income recognized on loan-level derivative agreements that we
entered into during the quarter.
Noninterest income for the nine months ended September 30, 2018 was $3.7 million as compared to $2.5 million for the nine months September 30, 2017 or an increase of 49.1%. This
increase was driven by loan-level derivative income of $1.2 million.
NONINTEREST EXPENSE
Noninterest expense for the quarter ended September 30, 2018 was $7.8 million as compared to $7.9 million for the quarter ended September 30, 2017 or a decrease of 1.3%.
- Salaries and employee benefits decreased $173,000 or 3.3% driven by reduced incentive
compensation expense as well as reduced stock-based compensation
expense as the majority of stock awards granted under the 2012
Equity Incentive Plan were fully expensed in the fourth quarter of
2017.
- Director compensation decreased $107,000 or 29.6% driven by reduced stock-based
compensation expense as the majority of stock awards granted under
the 2012 Equity Incentive Plan were fully expensed in the fourth
quarter of 2017.
- Deposit insurance expense increased by $96,000 or 22.2% driven by asset growth.
- Marketing expense increased by $49,000 or 27.5% due to the timing of certain
marketing initiatives.
Noninterest expense for the nine months ended September 30, 2018 was $23.3 million as compared to $23.0 million for the nine months ended
September 30, 2017 or an increase of
1.1%.
- Salaries and employee benefits increased $262,000 or 1.8%.
- Director compensation decreased $344,000 or 33.7% resulting from reduced
stock-based compensation expense as the majority of stock awards
granted under the 2012 Equity Incentive Plan were fully expensed in
the fourth quarter of 2017.
- Deposit insurance expense increased by $262,000 or 21.0% driven by asset growth.
Our efficiency ratio improved to 47.3% for the quarter ended
September 30, 2018 from 52.6% for the
quarter ended September 30, 2017 and
to 47.2% for the nine months ended September
30, 2018 from 52.5% for the nine months ended September 30, 2017 as we continue to grow the
balance sheet and manage costs. A talented and committed colleague
team combined with continued operational enhancements have
contributed to the improvement in our efficiency ratio.
INCOME TAXES
We recorded a provision for income taxes of $2.3 million for the quarter ended
September 30, 2018, compared to a provision for income taxes
of $2.0 million for the quarter
ended September 30, 2017, reflecting effective tax rates of
27.0% and 30.3%, respectively. We recorded a provision for income
taxes of $6.6 million for the
nine months ended September 30, 2018, compared to a provision
for income taxes of $6.5 million
for the nine months ended September 30, 2017, reflecting
effective tax rates of 26.5% and 34.6%, respectively. The decrease
in the effective tax rate was driven by a reduction in the federal
income tax rate from 35% to 21% that became effective on
January 1, 2018.
BALANCE SHEET
At September 30, 2018, total
assets were $2.97 billion, an
increase of $295.2 million or 11.0%
from $2.68 billion at December 31, 2017. The Company experienced net
loan growth of $273.1 million or
11.9% from December 31, 2017 to September 30, 2018. One-to-four family
residential real estate loans, commercial real estate loans and
multi-family real estate loans increased by $221.2 million, $50.9
million and $39.9 million,
respectively. Partially offsetting these increases were decreases
in home equity lines of credit, indirect auto loans and
construction loans of $14.0 million,
$14.6 million and $9.6 million, respectively. The asset growth was
primarily funded by growth in deposits and federal home loan bank
advances.
At September 30, 2018, deposits totaled $1.9 billion, an increase of $197.1 million or 11.3% from $1.75 billion at December 31, 2017. Core
deposits, which we consider to include all deposits other than CDs,
increased by $34.8 million or 2.8%
from $1.25 billion at December 31, 2017 to $1.28
billion at September 30, 2018.
Hal R. Tovin, Executive Vice
President and Chief Operating Officer, said "Deposit growth
continued in Q3 despite a very competitive marketplace. Municipal
relationship expansion, continued acquisition of customers in the
Non Profit Sector and the ongoing introduction and advertising of
retail products drove this performance."
Total stockholders' equity increased by $19.9 million or 11.2% from $178.0 million as of December 31, 2017 to $198.0 million as of September 30, 2018. This increase is primarily
the result of earnings of $18.3
million and a $1.7 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 September 30, 2018 was $17.5 million and 0.68%, respectively, as
compared to $16.3 million and
0.71%, respectively, as of December 31, 2017. For the
nine months ended September 30, 2018,
the Company recorded net charge offs of $23,000, as compared to net charge offs of
$35,000 for the nine months ended
September 30, 2017. Total
non-performing assets were $1.2
million or 0.04% of total assets as of September 30, 2018 and $1.4 million or 0.05% of total assets as of
December 31, 2017.
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, nonprofit organizations,
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 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,
the Company's 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)
|
|
|
|
|
|
|
September 30,
2018
|
|
December 31,
2017
|
|
|
|
|
|
(unaudited)
|
|
|
ASSETS
|
|
|
|
|
Cash and due from
banks
|
|
$
1,676
|
|
$
1,771
|
Interest-bearing
deposits in other banks
|
|
131,945
|
|
109,117
|
|
|
|
Cash and cash
equivalents
|
|
133,621
|
|
110,888
|
Interest-bearing time
deposits with other banks
|
|
5,229
|
|
2,440
|
Investments in
available-for-sale securities
|
|
4,035
|
|
16,921
|
Investments in
held-to-maturity securities (fair value of $146,658 as
of September 30, 2018 and $158,385 as of December 31,
2017)
|
|
150,981
|
|
160,090
|
Federal Home Loan
Bank stock, at cost
|
|
37,412
|
|
32,382
|
Loans held for
sale
|
|
6,214
|
|
-
|
Loans, net of
allowance for loan losses of $17,481 as of September 30, 2018
and $16,312 as of December 31, 2017
|
|
2,570,105
|
|
2,296,958
|
Premises and
equipment, net
|
|
2,305
|
|
2,254
|
Accrued interest
receivable
|
|
7,666
|
|
6,344
|
Deferred tax asset,
net
|
|
6,114
|
|
5,794
|
Income taxes
receivable
|
|
276
|
|
53
|
Bank-owned life
insurance
|
|
37,770
|
|
36,967
|
Other
assets
|
|
10,079
|
|
5,474
|
|
|
|
Total
assets
|
|
$
2,971,807
|
|
$
2,676,565
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
Noninterest-bearing
|
|
$
201,966
|
|
$
221,462
|
|
|
Interest-bearing
|
|
1,746,362
|
|
1,529,789
|
|
|
|
Total
deposits
|
|
1,948,328
|
|
1,751,251
|
Federal Home Loan
Bank advances
|
|
794,250
|
|
723,150
|
Securities sold under
agreements to repurchase
|
|
2,254
|
|
3,268
|
Accrued interest
payable
|
|
1,914
|
|
1,594
|
Deferred compensation
liability
|
|
8,454
|
|
7,919
|
Other
liabilities
|
|
18,657
|
|
11,354
|
|
|
|
Total
liabilities
|
|
2,773,857
|
|
2,498,536
|
Stockholders'
Equity:
|
|
|
|
|
|
Common stock; $0.01
par value per share, 100,000,000 shares authorized; 9,753,797 and
9,707,665 shares issued and outstanding at September 30, 2018 and
December 31, 2017, respectively
|
|
98
|
|
97
|
|
Additional paid-in
capital
|
|
96,241
|
|
94,590
|
|
Retained
earnings
|
|
105,171
|
|
86,884
|
|
Accumulated other
comprehensive (loss) income
|
|
(42)
|
|
89
|
|
Unearned compensation
- ESOP
|
|
(3,518)
|
|
(3,631)
|
|
|
|
Total stockholders'
equity
|
|
197,950
|
|
178,029
|
|
|
|
Total liabilities and
stockholders' equity
|
|
$
2,971,807
|
|
$
2,676,565
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Quality
Data:
|
|
|
|
|
Total non-performing
assets
|
|
$
1,205
|
|
$
1,376
|
Total non-performing
loans
|
|
$
1,194
|
|
$
1,376
|
Non-performing loans
to total loans
|
|
0.05%
|
|
0.06%
|
Non-performing assets
to total assets
|
|
0.04%
|
|
0.05%
|
Allowance for loan
losses to non-performing loans
|
|
1464.07%
|
|
1185.47%
|
Allowance for loan
losses to total loans
|
|
0.68%
|
|
0.71%
|
|
|
|
|
|
|
|
|
Share
Data:
|
|
|
|
|
Outstanding common
shares
|
|
9,753,797
|
|
9,707,665
|
Book value per
share
|
|
$
20.29
|
|
$
18.34
|
|
|
|
|
|
|
|
|
Consolidated Capital
Ratios:
|
|
|
|
|
|
Common Equity Tier 1
Risk-Based Capital Ratio
|
|
10.74%
|
|
10.35%
|
|
Tier 1 Risk-Based
Capital Ratio
|
|
10.74%
|
|
10.35%
|
|
Total Risk-Based
Capital Ratio
|
|
11.69%
|
|
11.30%
|
|
Leverage
Ratio
|
|
6.76%
|
|
6.97%
|
BSB BANCORP, INC.
AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(Dollars in
thousands, except per share data)
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
Interest and dividend
income:
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
23,778
|
|
$
18,432
|
|
$
66,796
|
|
$
52,328
|
|
Interest on taxable
debt securities
|
|
857
|
|
829
|
|
2,628
|
|
2,452
|
|
Dividends
|
|
525
|
|
320
|
|
1,359
|
|
866
|
|
Other interest
income
|
|
484
|
|
177
|
|
1,162
|
|
382
|
|
|
|
Total interest and
dividend income
|
|
25,644
|
|
19,758
|
|
71,945
|
|
56,028
|
Interest
expense:
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
6,498
|
|
3,391
|
|
16,346
|
|
8,992
|
|
Interest on Federal
Home Loan Bank advances
|
|
3,736
|
|
2,187
|
|
9,945
|
|
5,645
|
|
Interest on
securities sold under agreements to repurchase
|
|
1
|
|
1
|
|
4
|
|
3
|
|
|
|
Total interest
expense
|
|
10,235
|
|
5,579
|
|
26,295
|
|
14,640
|
|
|
|
Net interest and
dividend income
|
|
15,409
|
|
14,179
|
|
45,650
|
|
41,388
|
Provision for loan
losses
|
|
191
|
|
535
|
|
1,192
|
|
2,070
|
|
|
|
Net interest and
dividend income after provision for loan losses
|
|
15,218
|
|
13,644
|
|
44,458
|
|
39,318
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest
income:
|
|
|
|
|
|
|
|
|
|
Customer service
fees
|
|
221
|
|
205
|
|
628
|
|
586
|
|
Income from
bank-owned life insurance
|
|
274
|
|
287
|
|
803
|
|
834
|
|
Net gain on sales of
loans
|
|
305
|
|
267
|
|
642
|
|
613
|
|
Loan servicing fee
income
|
|
77
|
|
71
|
|
282
|
|
288
|
|
Loan level derivative
income
|
|
126
|
|
-
|
|
1,158
|
|
-
|
|
Other
income
|
|
133
|
|
55
|
|
229
|
|
188
|
|
|
|
Total noninterest
income
|
|
1,136
|
|
885
|
|
3,742
|
|
2,509
|
Noninterest
expense:
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
5,071
|
|
5,244
|
|
14,954
|
|
14,692
|
|
Director
compensation
|
|
254
|
|
361
|
|
676
|
|
1,020
|
|
Occupancy
expense
|
|
242
|
|
242
|
|
742
|
|
741
|
|
Equipment
expense
|
|
101
|
|
100
|
|
277
|
|
327
|
|
Deposit
insurance
|
|
528
|
|
432
|
|
1,512
|
|
1,250
|
|
Data
processing
|
|
687
|
|
674
|
|
2,150
|
|
2,062
|
|
Professional
fees
|
|
212
|
|
220
|
|
757
|
|
779
|
|
Marketing
|
|
227
|
|
178
|
|
742
|
|
739
|
|
Other
expense
|
|
504
|
|
478
|
|
1,495
|
|
1,439
|
|
|
|
Total noninterest
expense
|
|
7,826
|
|
7,929
|
|
23,305
|
|
23,049
|
|
|
|
Income before income
tax expense
|
|
8,528
|
|
6,600
|
|
24,895
|
|
18,778
|
Income tax
expense
|
|
2,300
|
|
2,001
|
|
6,589
|
|
6,500
|
|
|
|
|
Net income
|
|
$
6,228
|
|
$
4,599
|
|
$
18,306
|
|
$
12,278
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.70
|
|
$
0.52
|
|
$
2.05
|
|
$
1.39
|
|
|
|
|
Diluted
|
|
$
0.66
|
|
$
0.50
|
|
$
1.95
|
|
$
1.33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
0.84%
|
|
0.76%
|
|
0.87%
|
|
0.71%
|
Return on average
equity
|
|
12.65%
|
|
10.51%
|
|
12.96%
|
|
9.74%
|
Interest rate spread
(1)
|
|
1.89%
|
|
2.20%
|
|
1.99%
|
|
2.27%
|
Net interest margin
(1)
|
|
2.07%
|
|
2.36%
|
|
2.17%
|
|
2.41%
|
Efficiency
ratio
|
|
47.30%
|
|
52.64%
|
|
47.18%
|
|
52.51%
|
Net
charge-offs
|
|
$
6
|
|
$
4
|
|
$
23
|
|
$
36
|
|
|
(1) Does not
include dividends on FHLB stock of $525,000 and $1.4 million and
$320,000 and $866,000 for the three and nine
months ended September 30,
2018 and 2017 (unaudited), respectively.
|
Contact:
|
|
Robert M.
Mahoney
|
|
|
|
|
President and
Chief Executive Officer
|
|
|
|
|
|
|
|
Phone:
|
|
617-484-6700
|
|
|
Email:
|
|
robert.mahoney@belmontsavings.com
|
|
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multimedia:http://www.prnewswire.com/news-releases/bsb-bancorp-inc-reports-third-quarter-results--year-over-year-earnings-growth-of-35-4-300733711.html
SOURCE BSB Bancorp, Inc.