Enterprise Bancorp, Inc. (NASDAQ: EBTC), parent of Enterprise Bank,
announced its financial results for the three months ended
September 30, 2023. Net income amounted to $9.7 million,
or $0.79 per diluted common share, for the three months ended
September 30, 2023, compared to $12.0 million, or $0.98,
for the three months ended September 30, 2022 and
$9.7 million, or $0.79, for the three months ended
June 30, 2023.
Selected financial results at or for the three months ended
September 30, 2023, were as follows:
- The return on average assets and
average equity were 0.85% and 12.53%, respectively.
- Tax-equivalent net interest margin
(non-GAAP) was 3.46%.
- Total loans increased 2% compared to
June 30, 2023, and 9% compared to September 30,
2022.
- Total deposits decreased 0.4%
compared to June 30, 2023, and 2% compared to
September 30, 2022.
- Overnight and short-term investments
(interest-earning deposits with banks) amounted to
$180.1 million.
- There were no brokered deposits and only $4.3 million in
borrowed funds.
Chief Executive Officer Jack Clancy commented, "We are pleased
with our third quarter results. Liquidity remained favorable and
loan growth has been solid and consistent. While increasing funding
costs remain a challenge, we continue to experience strong growth
opportunities in our markets for our commercial lending, cash
management and wealth management services."
Executive Chairman & Founder George Duncan added, "I am
pleased to highlight that on October 17th, the Company's Board of
Directors declared a quarterly dividend of $0.23 per share, an
increase of 12% over the prior year period. On September 7th, we
were once again recognized at the Boston Business Journal's
Corporate Citizenship Summit for our significant contributions in
employee volunteerism and corporate philanthropy. In particular, I
am very proud that we ranked 2nd in the state of Massachusetts for
the highest average volunteer hours per employee."
Net Interest Income
Net interest income for the three months ended September 30,
2023, amounted to $38.5 million, a decrease of
$1.3 million, or 3%, compared to the three months
ended September 30, 2022. The decrease was due largely to
an increase in deposit interest expense of $11.4 million which
resulted from continued market interest rate increases and a change
in deposit mix, partially offset by increases in loan interest
income of $9.2 million and other interest-earning asset income
of $1.4 million.
Net Interest Margin
The decrease in net interest margin over the respective periods
was due primarily to an increase in funding costs that exceeded the
increase in loan yields. During the periods, the cost of deposits
increased from higher market and competitor interest rates and from
a change in mix as deposits migrated from lower yielding checking
and savings products into higher yielding money market and
certificate of deposit products.
Three months ended – September 30, 2023, compared to
June 30, 2023
Tax-equivalent net interest margin ("net interest margin") was
3.46% for the three months ended September 30, 2023, compared to
3.55% for the three months ended June 30, 2023.
Net interest margin compared to the prior quarter was impacted
by the following factors:
- Average interest-earning deposits
with banks increased $104.5 million, or 68%, and the yield
increased 40 basis points.
- Average debt securities decreased
$98.1 million, or 11%, and the tax-equivalent yield decreased 9
basis points.
- Average loan balances increased
$104.2 million, or 3%, and the tax-equivalent yield increased 11
basis points.
- Average total deposits increased $94.1 million, or 2%, and the
yield increased 27 basis points.
Three months ended – September 30, 2023, compared to
September 30, 2022
Net interest margin was 3.46% for the three months ended
September 30, 2023, compared to 3.61% for the three months ended
September 30, 2022.
Net interest margin compared to the prior year quarter was
impacted by the following factors:
- Average interest-earning deposits
with banks decreased $114.8 million, or 31%, while the yield
increased 308 basis points.
- Average debt securities decreased
$136.8 million, or 14%, while the tax-equivalent yield increased 10
basis points.
- Average loan balances increased
$286.9 million, or 9%, and the tax-equivalent yield increased 69
basis points.
- Average total deposits decreased $8.6 million, while the yield
increased 110 basis points.
Provision for Credit Losses
The provision for credit losses for the three months ended
September 30, 2023, amounted to $1.8 million, compared to $1.0
million for the three months ended September 30, 2022.
The provision expense for the third quarter of 2023 resulted
primarily from an increase in reserves for individually evaluated
loans and, to a lesser extent, growth in the Company's loan
portfolio and off-balance sheet commitments, partially offset by
the impact of a reduction in general reserve loss factors in our
allowance for credit loss ("ACL") model related primarily to an
improvement in the economic forecast relative to the prior quarter.
The ACL for loans to total loans ratio was 1.70% at
September 30, 2023 compared to 1.65% at September 30,
2022.
Non-Interest Income
Non-interest income for the three months ended September 30,
2023, amounted to $4.5 million, a decrease of $39 thousand, or
1%, compared to the three months ended September 30,
2022. There were no individually significant changes in
non-interest income during the period when compared to the prior
year period.
Non-Interest Expense
Non-interest expense for the three months ended September 30,
2023, amounted to $28.3 million, an increase of $775 thousand,
or 3%, compared to the three months ended September 30,
2022. The increase was due primarily to increases in salary and
employee benefits of $244 thousand, occupancy and equipment
expenses of $230 thousand and deposit insurance premiums of
$263 thousand.
Income Taxes
The effective tax rate was 25.0% and 24.1% for the three months
ended September 30, 2023 and 2022, respectively. The
difference resulted primarily from an increase in state taxes
including a transfer of funds from the Bank's investment subsidiary
corporations.
Balance Sheet
Total assets amounted to $4.48 billion at September 30,
2023, compared to $4.44 billion at December 31, 2022, an
increase of $44.0 million, or 1%.
Total interest-earning deposits with banks, which consist of
overnight and short-term investments, amounted to $180.1 million at
September 30, 2023, compared to $230.7 million at
December 31, 2022. The decrease of $50.6 million, or 22%, was
related primarily to funding loan growth.
Total investment securities at fair value amounted to $678.9
million at September 30, 2023, compared to $820.4 million at
December 31, 2022. The decrease of $141.4 million, or 17%, was
attributable principally to sales of debt securities of $84.8
million and principal pay-downs, calls and maturities of $46.3
million. At September 30, 2023, unrealized losses on debt
securities amounted to $133.2 million and Management determined
that no ACL for available-for-sale securities was necessary.
Total loans amounted to $3.40 billion at September 30,
2023, compared to $3.18 billion at December 31, 2022. The
increase of $223.5 million, or 7%, was primarily in commercial real
estate of $111.0 million, or 6%, and commercial construction of
$77.1 million, or 18%.
Total deposits amounted to $4.06 billion at September 30,
2023, compared to $4.04 billion at December 31, 2022, an
increase of $24.6 million, or 1%. The Company has experienced a
shift in deposit mix at September 30, 2023, compared to
December 31, 2022, resulting from customers moving funds out
of lower yielding checking and savings products (which together,
have decreased 9%) into higher yielding money market and
certificate of deposit products (which together, have increased
15%).
Shareholders' Equity
Total shareholders' equity amounted to $299.7 million at
September 30, 2023, compared to $282.3 million at
December 31, 2022. The increase of $17.4 million, or 6%, was
due primarily to an increase in retained earnings, partially offset
by an increase in the accumulated other comprehensive loss.
Credit Quality
Selected credit quality metrics at September 30, 2023,
compared to December 31, 2022, are as follows:
- The ACL for loans amounted to $57.9
million, or 1.70% of total loans, compared to $52.6 million, or
1.66% of total loans.
- The reserve for unfunded commitments
(included in other liabilities) amounted to $5.7 million compared
to $4.3 million.
- Non-performing loans amounted to $11.7 million, or 0.34% of
total loans, compared to $6.1 million, or 0.19% of total loans. The
increase resulted primarily from one commercial relationship which
also accounted for the increase in reserves for individually
evaluated loans noted above.
Wealth Management
Wealth assets are not carried as assets on the Company's
consolidated balance sheets.
Wealth assets under management amounted to $984.6 million at
September 30, 2023. The increase of $93.2 million, or 10%,
compared to December 31, 2022 resulted primarily from an
increase in market values, and to a lesser extent, net asset growth
attracted through new and expanded client relationships.
Wealth assets under administration amounted to $211.0 million at
September 30, 2023 an increase of $12.5 million, or 6%,
compared to December 31, 2022.
Supplemental Information
All balances and ratios presented in this section are at
September 30, 2023 unless otherwise indicated.
Liquidity & Funding Capacity
- Overnight and short-term investments
amounted to $180.1 million.
- FHLB and Federal Reserve Bank of
Boston secured borrowing capacity amounted to $1.2 billion.
- The Company has several brokered deposit relationships
(unsecured borrowings) which management estimated could provide an
additional $800.0 million in funding capacity.
Deposit Information
- Uninsured deposits amounted to 35%
of total deposits.
- Deposit balances that utilize third
party enhanced Federal Deposit Insurance Corporation ("FDIC")
insured products amounted to $815.0 million.
- Additional capacity to utilize these enhanced FDIC insured
products exceeds the Company's total deposits balance.
About Enterprise Bancorp, Inc.Enterprise Bancorp, Inc. is a
Massachusetts corporation that conducts substantially all its
operations through Enterprise Bank and Trust Company, commonly
referred to as Enterprise Bank, and has reported 136 consecutive
profitable quarters. Enterprise Bank is principally engaged in the
business of attracting deposits from the general public and
investing in commercial loans and investment securities. Through
Enterprise Bank and its subsidiaries, the Company offers a range of
commercial, residential and consumer loan products, deposit
products and cash management services, electronic and digital
banking options, as well as wealth management, and trust services.
The Company's headquarters and Enterprise Bank's main office are
located at 222 Merrimack Street in Lowell, Massachusetts. The
Company's primary market area is the Northern Middlesex, Northern
Essex, and Northern Worcester counties of Massachusetts and the
Southern Hillsborough and Southern Rockingham counties in New
Hampshire. Enterprise Bank has 27 full-service branches located in
the Massachusetts communities of Acton, Andover, Billerica (2),
Chelmsford (2), Dracut, Fitchburg, Lawrence, Leominster, Lexington,
Lowell (2), Methuen, North Andover, Tewksbury (2), Tyngsborough and
Westford and in the New Hampshire communities of Derry, Hudson,
Londonderry, Nashua (2), Pelham, Salem and Windham.
Forward-Looking StatementsThis earnings release contains
statements about future events that constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements may be identified by
references to a future period or periods or by the use of the words
"believe," "expect," "anticipate," "intend," "estimate," "assume,"
"will," "should," "could," "plan," and other similar terms or
expressions. Forward-looking statements should not be relied on
because they involve known and unknown risks, uncertainties and
other factors, some of which are beyond the control of the Company.
These risks, uncertainties, and other factors may cause the actual
results, performance, and achievements of the Company to be
materially different from the anticipated future results,
performance or achievements expressed in, or implied by, the
forward-looking statements. Factors that could cause such
differences include, but are not limited to, the impact on us and
our customers of a decline in general economic conditions and any
regulatory responses thereto; potential recession in the United
States and our market areas; the impacts related to or resulting
from recent bank failures and any continuation of the recent
uncertainty in the banking industry, including the associated
impact to the Company and other financial institutions of any
regulatory changes or other mitigation efforts taken by government
agencies in response thereto; increased competition for deposits
and related changes in deposit customer behavior; changes in market
interest rates; the persistence of the current inflationary
environment in our market areas and the United States; the
uncertain impacts of ongoing quantitative tightening and current
and future monetary policies of the Board of Governors of the
Federal Reserve System; the effects of declines in housing prices
in the United States and our market areas; increases in
unemployment rates in the United States and our market areas;
declines in commercial real estate prices; uncertainty regarding
United States fiscal debt and budget matters; cyber incidents or
other failures, disruptions or security breaches; severe weather,
natural disasters, acts of war or terrorism or other external
events; regulatory considerations; competition and market expansion
opportunities; changes in non-interest expenditures or in the
anticipated benefits of such expenditures; the receipt of required
regulatory approvals; changes in tax laws; and current or future
litigation, regulatory examinations or other legal and/or
regulatory actions. Therefore, the Company can give no assurance
that the results contemplated in the forward-looking statements
will be realized and readers are cautioned not to place undue
reliance on the forward-looking statements contained in this press
release. For more information about these factors, please see our
reports filed with or furnished to the U.S. Securities and Exchange
Commission (the "SEC"), including our most recent Annual Report on
Form 10-K and Quarterly Reports on Form 10-Q on file with the SEC,
including the sections entitled "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations." Any forward-looking statements contained in this
earnings release are made as of the date hereof, and we undertake
no duty, and specifically disclaim any duty, to update or revise
any such statements, whether as a result of new information, future
events or otherwise, except as required by applicable law.
|
ENTERPRISE BANCORP, INC.Consolidated Balance
Sheets(unaudited) |
|
(Dollars in thousands, except per share
data) |
|
September 30,2023 |
|
December 31,2022 |
Assets |
|
|
|
|
Cash and cash equivalents: |
|
|
|
|
Cash and due from banks |
|
$ |
45,345 |
|
|
$ |
36,901 |
|
Interest-earning deposits with banks |
|
|
180,076 |
|
|
|
230,688 |
|
Total cash and cash equivalents |
|
|
225,421 |
|
|
|
267,589 |
|
Investments: |
|
|
|
|
Debt securities at fair value (amortized cost of $806,077 and
$940,227, respectively) |
|
|
672,894 |
|
|
|
816,102 |
|
Equity securities at fair value |
|
|
6,038 |
|
|
|
4,269 |
|
Total investment securities at fair value |
|
|
678,932 |
|
|
|
820,371 |
|
Federal Home Loan Bank stock |
|
|
2,403 |
|
|
|
2,343 |
|
Loans: |
|
|
|
|
Total loans |
|
|
3,404,014 |
|
|
|
3,180,518 |
|
Allowance for credit losses |
|
|
(57,905 |
) |
|
|
(52,640 |
) |
Net loans |
|
|
3,346,109 |
|
|
|
3,127,878 |
|
Premises and equipment, net |
|
|
43,391 |
|
|
|
44,228 |
|
Lease right-of-use asset |
|
|
24,979 |
|
|
|
24,923 |
|
Accrued interest receivable |
|
|
18,572 |
|
|
|
17,117 |
|
Deferred income taxes, net |
|
|
55,080 |
|
|
|
51,981 |
|
Bank-owned life insurance |
|
|
65,106 |
|
|
|
64,156 |
|
Prepaid income taxes |
|
|
2,548 |
|
|
|
683 |
|
Prepaid expenses and other assets |
|
|
14,177 |
|
|
|
11,408 |
|
Goodwill |
|
|
5,656 |
|
|
|
5,656 |
|
Total assets |
|
$ |
4,482,374 |
|
|
$ |
4,438,333 |
|
Liabilities and Shareholders'
Equity |
|
|
|
|
Liabilities |
|
|
|
|
Deposits |
|
$ |
4,060,403 |
|
|
$ |
4,035,806 |
|
Borrowed funds |
|
|
4,290 |
|
|
|
3,216 |
|
Subordinated debt |
|
|
59,419 |
|
|
|
59,182 |
|
Lease liability |
|
|
24,589 |
|
|
|
24,415 |
|
Accrued expenses and other liabilities |
|
|
31,288 |
|
|
|
31,442 |
|
Accrued interest payable |
|
|
2,686 |
|
|
|
2,005 |
|
Total liabilities |
|
|
4,182,675 |
|
|
|
4,156,066 |
|
Commitments and Contingencies |
|
|
|
|
Shareholders' Equity |
|
|
|
|
Preferred stock, $0.01 par value per share; 1,000,000 shares
authorized; no shares issued |
|
|
— |
|
|
|
— |
|
Common stock, $0.01 par value per share; 40,000,000 shares
authorized; 12,256,964 and 12,133,516 shares issued and
outstanding, respectively |
|
|
123 |
|
|
|
121 |
|
Additional paid-in capital |
|
|
106,451 |
|
|
|
103,793 |
|
Retained earnings |
|
|
296,291 |
|
|
|
274,560 |
|
Accumulated other comprehensive loss |
|
|
(103,166 |
) |
|
|
(96,207 |
) |
Total shareholders' equity |
|
|
299,699 |
|
|
|
282,267 |
|
Total liabilities and shareholders' equity |
|
$ |
4,482,374 |
|
|
$ |
4,438,333 |
|
|
ENTERPRISE BANCORP, INC.Consolidated
Statements of Income(unaudited) |
|
|
|
Three months ended |
|
Nine months ended |
|
|
September 30, |
|
September 30, |
(Dollars in thousands, except per share data) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Interest and dividend income: |
|
|
|
|
|
|
|
|
Loans and loans held for sale |
|
$ |
44,501 |
|
|
$ |
35,306 |
|
|
$ |
125,855 |
|
|
$ |
98,149 |
|
Investment securities |
|
|
4,316 |
|
|
|
4,728 |
|
|
|
14,356 |
|
|
|
14,097 |
|
Other interest-earning assets |
|
|
3,468 |
|
|
|
2,068 |
|
|
|
7,593 |
|
|
|
2,642 |
|
Total interest and dividend income |
|
|
52,285 |
|
|
|
42,102 |
|
|
|
147,804 |
|
|
|
114,888 |
|
Interest expense: |
|
|
|
|
|
|
|
|
Deposits |
|
|
12,889 |
|
|
|
1,460 |
|
|
|
28,568 |
|
|
|
2,731 |
|
Borrowed funds |
|
|
28 |
|
|
|
13 |
|
|
|
70 |
|
|
|
39 |
|
Subordinated debt |
|
|
866 |
|
|
|
850 |
|
|
|
2,600 |
|
|
|
2,485 |
|
Total interest expense |
|
|
13,783 |
|
|
|
2,323 |
|
|
|
31,238 |
|
|
|
5,255 |
|
Net interest income |
|
|
38,502 |
|
|
|
39,779 |
|
|
|
116,566 |
|
|
|
109,633 |
|
Provision for credit
losses |
|
|
1,752 |
|
|
|
1,000 |
|
|
|
6,756 |
|
|
|
3,939 |
|
Net interest income after provision for credit losses |
|
|
36,750 |
|
|
|
38,779 |
|
|
|
109,810 |
|
|
|
105,694 |
|
Non-interest income: |
|
|
|
|
|
|
|
|
Wealth management fees |
|
|
1,673 |
|
|
|
1,626 |
|
|
|
4,933 |
|
|
|
4,965 |
|
Deposit and interchange fees |
|
|
1,987 |
|
|
|
2,045 |
|
|
|
6,330 |
|
|
|
5,847 |
|
Income on bank-owned life insurance, net |
|
|
327 |
|
|
|
303 |
|
|
|
950 |
|
|
|
893 |
|
Net (losses) gains on sales of debt securities |
|
|
— |
|
|
|
— |
|
|
|
(2,419 |
) |
|
|
1,062 |
|
Net gains on sales of loans |
|
|
14 |
|
|
|
8 |
|
|
|
34 |
|
|
|
30 |
|
Losses on equity securities |
|
|
(181 |
) |
|
|
(193 |
) |
|
|
(8 |
) |
|
|
(688 |
) |
Other income |
|
|
666 |
|
|
|
736 |
|
|
|
2,242 |
|
|
|
2,143 |
|
Total non-interest income |
|
|
4,486 |
|
|
|
4,525 |
|
|
|
12,062 |
|
|
|
14,252 |
|
Non-interest expense: |
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
|
19,159 |
|
|
|
18,915 |
|
|
|
53,815 |
|
|
|
53,450 |
|
Occupancy and equipment expenses |
|
|
2,433 |
|
|
|
2,203 |
|
|
|
7,439 |
|
|
|
6,982 |
|
Technology and telecommunications expenses |
|
|
2,626 |
|
|
|
2,599 |
|
|
|
7,937 |
|
|
|
8,154 |
|
Advertising and public relations expenses |
|
|
592 |
|
|
|
510 |
|
|
|
2,077 |
|
|
|
1,737 |
|
Audit, legal and other professional fees |
|
|
735 |
|
|
|
693 |
|
|
|
2,157 |
|
|
|
2,078 |
|
Deposit insurance premiums |
|
|
654 |
|
|
|
391 |
|
|
|
1,944 |
|
|
|
1,313 |
|
Supplies and postage expenses |
|
|
251 |
|
|
|
219 |
|
|
|
753 |
|
|
|
663 |
|
Other operating expenses |
|
|
1,862 |
|
|
|
2,007 |
|
|
|
5,853 |
|
|
|
5,770 |
|
Total non-interest expense |
|
|
28,312 |
|
|
|
27,537 |
|
|
|
81,975 |
|
|
|
80,147 |
|
Income before income
taxes |
|
|
12,924 |
|
|
|
15,767 |
|
|
|
39,897 |
|
|
|
39,799 |
|
Provision for income
taxes |
|
|
3,225 |
|
|
|
3,805 |
|
|
|
9,746 |
|
|
|
9,389 |
|
Net income |
|
$ |
9,699 |
|
|
$ |
11,962 |
|
|
$ |
30,151 |
|
|
$ |
30,410 |
|
|
|
|
|
|
|
|
|
|
Basic earnings per common
share |
|
$ |
0.79 |
|
|
$ |
0.99 |
|
|
$ |
2.47 |
|
|
$ |
2.51 |
|
Diluted earnings per common
share |
|
$ |
0.79 |
|
|
$ |
0.98 |
|
|
$ |
2.46 |
|
|
$ |
2.50 |
|
|
|
|
|
|
|
|
|
|
Basic weighted average common
shares outstanding |
|
|
12,247,892 |
|
|
|
12,119,348 |
|
|
|
12,210,740 |
|
|
|
12,094,613 |
|
Diluted weighted average
common shares outstanding |
|
|
12,264,778 |
|
|
|
12,156,695 |
|
|
|
12,233,861 |
|
|
|
12,143,468 |
|
|
ENTERPRISE BANCORP, INC.Selected Consolidated
Financial Data and Ratios(unaudited) |
|
|
|
At or for the three months ended |
(Dollars in thousands, except per share
data) |
|
September 30,2023 |
|
June 30,2023 |
|
March 31,2023 |
|
December 31,2022 |
|
September 30,2022 |
Balance Sheet Data |
|
|
|
|
|
|
|
|
|
|
Total cash and cash equivalents |
|
$ |
225,421 |
|
|
$ |
258,825 |
|
|
$ |
215,693 |
|
|
$ |
267,589 |
|
|
$ |
413,688 |
|
Total investment securities at
fair value |
|
|
678,932 |
|
|
|
712,851 |
|
|
|
830,895 |
|
|
|
820,371 |
|
|
|
831,030 |
|
Total loans |
|
|
3,404,014 |
|
|
|
3,345,667 |
|
|
|
3,230,156 |
|
|
|
3,180,518 |
|
|
|
3,109,369 |
|
Allowance for credit
losses |
|
|
(57,905 |
) |
|
|
(56,899 |
) |
|
|
(55,002 |
) |
|
|
(52,640 |
) |
|
|
(51,211 |
) |
Total assets |
|
|
4,482,374 |
|
|
|
4,502,344 |
|
|
|
4,441,896 |
|
|
|
4,438,333 |
|
|
|
4,529,820 |
|
Total deposits |
|
|
4,060,403 |
|
|
|
4,075,598 |
|
|
|
4,016,156 |
|
|
|
4,035,806 |
|
|
|
4,138,038 |
|
Subordinated debt |
|
|
59,419 |
|
|
|
59,340 |
|
|
|
59,261 |
|
|
|
59,182 |
|
|
|
59,102 |
|
Total shareholders'
equity |
|
|
299,699 |
|
|
|
307,490 |
|
|
|
311,318 |
|
|
|
282,267 |
|
|
|
272,193 |
|
Total liabilities and
shareholders' equity |
|
|
4,482,374 |
|
|
|
4,502,344 |
|
|
|
4,441,896 |
|
|
|
4,438,333 |
|
|
|
4,529,820 |
|
|
|
|
|
|
|
|
|
|
|
|
Wealth
Management |
|
|
|
|
|
|
|
|
|
|
Wealth assets under
management |
|
$ |
984,647 |
|
|
$ |
1,009,386 |
|
|
$ |
930,714 |
|
|
$ |
891,451 |
|
|
$ |
835,661 |
|
Wealth assets under
administration |
|
$ |
211,046 |
|
|
$ |
214,116 |
|
|
$ |
206,569 |
|
|
$ |
198,586 |
|
|
$ |
185,977 |
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' Equity
Ratios |
|
|
|
|
|
|
|
|
|
|
Book value per common
share |
|
$ |
24.45 |
|
|
$ |
25.11 |
|
|
$ |
25.47 |
|
|
$ |
23.26 |
|
|
$ |
22.44 |
|
Dividends paid per common
share |
|
$ |
0.230 |
|
|
$ |
0.230 |
|
|
$ |
0.230 |
|
|
$ |
0.205 |
|
|
$ |
0.205 |
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory Capital
Ratios |
|
|
|
|
|
|
|
|
|
|
Total capital to risk weighted
assets |
|
|
13.41 |
% |
|
|
13.37 |
% |
|
|
13.55 |
% |
|
|
13.49 |
% |
|
|
13.49 |
% |
Tier 1 capital to risk
weighted assets(1) |
|
|
10.58 |
% |
|
|
10.52 |
% |
|
|
10.64 |
% |
|
|
10.56 |
% |
|
|
10.52 |
% |
Tier 1 capital to average
assets |
|
|
8.59 |
% |
|
|
8.62 |
% |
|
|
8.47 |
% |
|
|
8.10 |
% |
|
|
7.89 |
% |
|
|
|
|
|
|
|
|
|
|
|
Credit Quality
Data |
|
|
|
|
|
|
|
|
|
|
Non-performing loans |
|
$ |
11,656 |
|
|
$ |
7,647 |
|
|
$ |
7,532 |
|
|
$ |
6,122 |
|
|
$ |
5,717 |
|
Non-performing loans to total
loans |
|
|
0.34 |
% |
|
|
0.23 |
% |
|
|
0.23 |
% |
|
|
0.19 |
% |
|
|
0.18 |
% |
Non-performing assets to total
assets |
|
|
0.26 |
% |
|
|
0.17 |
% |
|
|
0.17 |
% |
|
|
0.14 |
% |
|
|
0.13 |
% |
ACL for loans to total
loans |
|
|
1.70 |
% |
|
|
1.70 |
% |
|
|
1.70 |
% |
|
|
1.66 |
% |
|
|
1.65 |
% |
Net charge-offs
(recoveries) |
|
$ |
(12 |
) |
|
$ |
146 |
|
|
$ |
(44 |
) |
|
$ |
166 |
|
|
$ |
52 |
|
|
|
|
|
|
|
|
|
|
|
|
Income Statement
Data |
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
38,502 |
|
|
$ |
38,093 |
|
|
$ |
39,971 |
|
|
$ |
42,165 |
|
|
$ |
39,779 |
|
Provision for credit
losses |
|
|
1,752 |
|
|
|
2,268 |
|
|
|
2,736 |
|
|
|
1,861 |
|
|
|
1,000 |
|
Total non-interest income |
|
|
4,486 |
|
|
|
2,819 |
|
|
|
4,757 |
|
|
|
4,210 |
|
|
|
4,525 |
|
Total non-interest
expense |
|
|
28,312 |
|
|
|
25,623 |
|
|
|
28,040 |
|
|
|
28,167 |
|
|
|
27,537 |
|
Income before income
taxes |
|
|
12,924 |
|
|
|
13,021 |
|
|
|
13,952 |
|
|
|
16,347 |
|
|
|
15,767 |
|
Provision for income
taxes |
|
|
3,225 |
|
|
|
3,337 |
|
|
|
3,184 |
|
|
|
4,041 |
|
|
|
3,805 |
|
Net income |
|
$ |
9,699 |
|
|
$ |
9,684 |
|
|
$ |
10,768 |
|
|
$ |
12,306 |
|
|
$ |
11,962 |
|
|
|
|
|
|
|
|
|
|
|
|
Income Statement
Ratios |
|
|
|
|
|
|
|
|
|
|
Diluted earnings per common
share |
|
$ |
0.79 |
|
|
$ |
0.79 |
|
|
$ |
0.88 |
|
|
$ |
1.01 |
|
|
$ |
0.98 |
|
Return on average total
assets |
|
|
0.85 |
% |
|
|
0.88 |
% |
|
|
0.99 |
% |
|
|
1.08 |
% |
|
|
1.05 |
% |
Return on average
shareholders' equity |
|
|
12.53 |
% |
|
|
12.63 |
% |
|
|
14.67 |
% |
|
|
18.08 |
% |
|
|
16.47 |
% |
Net interest margin
(tax-equivalent)(2) |
|
|
3.46 |
% |
|
|
3.55 |
% |
|
|
3.76 |
% |
|
|
3.81 |
% |
|
|
3.61 |
% |
(1) |
Ratio also represents common equity tier 1 capital to risk weighted
assets as of the periods presented. |
(2) |
Tax-equivalent net interest margin is net interest income adjusted
for the tax-equivalent effect associated with tax-exempt loan and
investment income, expressed as a percentage of average
interest-earning assets. |
|
|
ENTERPRISE
BANCORP, INC.Consolidated Loan and Deposit
Data(unaudited)
Major classifications of loans at the dates indicated were as
follows:
(Dollars in thousands) |
|
September 30,2023 |
|
June 30,2023 |
|
March 31,2023 |
|
December 31,2022 |
|
September 30,2022 |
Commercial real estate |
|
$ |
2,032,458 |
|
|
$ |
2,009,263 |
|
|
$ |
1,929,544 |
|
|
$ |
1,921,410 |
|
|
$ |
1,886,365 |
|
Commercial and industrial |
|
|
425,334 |
|
|
|
420,095 |
|
|
|
423,864 |
|
|
|
414,490 |
|
|
|
413,347 |
|
Commercial construction |
|
|
501,179 |
|
|
|
487,018 |
|
|
|
456,735 |
|
|
|
424,049 |
|
|
|
396,027 |
|
SBA PPP |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,725 |
|
Total commercial loans |
|
|
2,958,971 |
|
|
|
2,916,376 |
|
|
|
2,810,143 |
|
|
|
2,759,949 |
|
|
|
2,698,464 |
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgages |
|
|
362,514 |
|
|
|
346,523 |
|
|
|
335,834 |
|
|
|
332,632 |
|
|
|
321,663 |
|
Home equity loans and
lines |
|
|
74,433 |
|
|
|
74,374 |
|
|
|
75,809 |
|
|
|
79,807 |
|
|
|
80,882 |
|
Consumer |
|
|
8,096 |
|
|
|
8,394 |
|
|
|
8,370 |
|
|
|
8,130 |
|
|
|
8,360 |
|
Total retail loans |
|
|
445,043 |
|
|
|
429,291 |
|
|
|
420,013 |
|
|
|
420,569 |
|
|
|
410,905 |
|
Total loans |
|
|
3,404,014 |
|
|
|
3,345,667 |
|
|
|
3,230,156 |
|
|
|
3,180,518 |
|
|
|
3,109,369 |
|
|
|
|
|
|
|
|
|
|
|
|
ACL for loans |
|
|
(57,905 |
) |
|
|
(56,899 |
) |
|
|
(55,002 |
) |
|
|
(52,640 |
) |
|
|
(51,211 |
) |
Net loans |
|
$ |
3,346,109 |
|
|
$ |
3,288,768 |
|
|
$ |
3,175,154 |
|
|
$ |
3,127,878 |
|
|
$ |
3,058,158 |
|
Deposits are summarized as follows as of the periods
indicated:
(Dollars in thousands) |
|
September 30,2023 |
|
June 30,2023 |
|
March 31,2023 |
|
December 31,2022 |
|
September 30,2022 |
Non-interest checking |
|
$ |
1,130,732 |
|
$ |
1,273,968 |
|
$ |
1,247,253 |
|
$ |
1,361,588 |
|
$ |
1,441,104 |
Interest-bearing checking |
|
|
727,817 |
|
|
701,701 |
|
|
641,194 |
|
|
678,715 |
|
|
719,474 |
Savings |
|
|
290,363 |
|
|
310,321 |
|
|
297,790 |
|
|
326,666 |
|
|
351,665 |
Money market |
|
|
1,434,036 |
|
|
1,373,816 |
|
|
1,454,858 |
|
|
1,381,645 |
|
|
1,395,756 |
CDs $250,000 or less |
|
|
262,975 |
|
|
244,114 |
|
|
222,116 |
|
|
187,758 |
|
|
163,520 |
CDs greater than $250,000 |
|
|
214,480 |
|
|
171,678 |
|
|
152,945 |
|
|
99,434 |
|
|
66,519 |
Deposits |
|
$ |
4,060,403 |
|
$ |
4,075,598 |
|
$ |
4,016,156 |
|
$ |
4,035,806 |
|
$ |
4,138,038 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ENTERPRISE
BANCORP, INC.Consolidated Average Balance Sheets and
Yields (tax-equivalent basis)(unaudited)
The following table presents the Company's average balance
sheets, net interest income and average rates for the periods
indicated:
(Dollars in thousands) |
|
Three months ended September 30, 2023 |
|
Three months ended June 30, 2023 |
|
Three months ended September 30, 2022 |
|
AverageBalance |
|
Interest(1) |
|
AverageYield(1) |
|
AverageBalance |
|
Interest(1) |
|
AverageYield(1) |
|
AverageBalance |
|
Interest(1) |
|
AverageYield(1) |
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans and loans held for sale(2) (tax-equivalent) |
|
$ |
3,372,754 |
|
$ |
44,644 |
|
5.25 |
% |
|
$ |
3,268,586 |
|
$ |
41,930 |
|
5.14 |
% |
|
$ |
3,085,896 |
|
$ |
35,422 |
|
4.56 |
% |
Investment securities(3) (tax-equivalent) |
|
|
820,156 |
|
|
4,444 |
|
2.17 |
% |
|
|
917,965 |
|
|
5,189 |
|
2.26 |
% |
|
|
954,385 |
|
|
4,959 |
|
2.08 |
% |
Other interest-earning assets(4) |
|
|
260,475 |
|
|
3,468 |
|
5.28 |
% |
|
|
155,934 |
|
|
1,917 |
|
4.93 |
% |
|
|
375,213 |
|
|
2,068 |
|
2.19 |
% |
Total interest-earnings assets (tax-equivalent) |
|
|
4,453,385 |
|
|
52,556 |
|
4.69 |
% |
|
|
4,342,485 |
|
|
49,036 |
|
4.53 |
% |
|
|
4,415,494 |
|
|
42,449 |
|
3.82 |
% |
Other assets |
|
|
82,190 |
|
|
|
|
|
|
92,909 |
|
|
|
|
|
|
101,095 |
|
|
|
|
Total assets |
|
$ |
4,535,575 |
|
|
|
|
|
$ |
4,435,394 |
|
|
|
|
|
$ |
4,516,589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders'
equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest checking, savings and money market |
|
$ |
2,481,814 |
|
|
9,185 |
|
1.47 |
% |
|
$ |
2,351,011 |
|
|
6,880 |
|
1.17 |
% |
|
$ |
2,444,705 |
|
|
1,045 |
|
0.17 |
% |
CDs |
|
|
430,376 |
|
|
3,704 |
|
3.41 |
% |
|
|
393,387 |
|
|
2,812 |
|
2.87 |
% |
|
|
221,827 |
|
|
415 |
|
0.74 |
% |
Borrowed funds |
|
|
4,938 |
|
|
28 |
|
2.30 |
% |
|
|
4,595 |
|
|
30 |
|
2.58 |
% |
|
|
2,940 |
|
|
13 |
|
1.77 |
% |
Subordinated debt(5) |
|
|
59,372 |
|
|
866 |
|
5.84 |
% |
|
|
59,293 |
|
|
867 |
|
5.85 |
% |
|
|
59,052 |
|
|
850 |
|
5.76 |
% |
Total interest-bearing funding |
|
|
2,976,500 |
|
|
13,783 |
|
1.84 |
% |
|
|
2,808,286 |
|
|
10,589 |
|
1.51 |
% |
|
|
2,728,524 |
|
|
2,323 |
|
0.34 |
% |
Non-interest checking |
|
|
1,195,658 |
|
|
— |
|
|
|
|
1,269,339 |
|
|
— |
|
|
|
|
1,449,909 |
|
|
— |
|
|
Total deposits, borrowed funds and subordinated debt |
|
|
4,172,158 |
|
|
13,783 |
|
1.31 |
% |
|
|
4,077,625 |
|
|
10,589 |
|
1.04 |
% |
|
|
4,178,433 |
|
|
2,323 |
|
0.22 |
% |
Other liabilities |
|
|
56,414 |
|
|
|
|
|
|
50,113 |
|
|
|
|
|
|
50,034 |
|
|
|
|
Total liabilities |
|
|
4,228,572 |
|
|
|
|
|
|
4,127,738 |
|
|
|
|
|
|
4,228,467 |
|
|
|
|
Stockholders' equity |
|
|
307,003 |
|
|
|
|
|
|
307,656 |
|
|
|
|
|
|
288,122 |
|
|
|
|
Total liabilities and stockholders' equity |
|
$ |
4,535,575 |
|
|
|
|
|
$ |
4,435,394 |
|
|
|
|
|
$ |
4,516,589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest-rate spread
(tax-equivalent) |
|
|
|
|
|
2.85 |
% |
|
|
|
|
|
3.02 |
% |
|
|
|
|
|
3.48 |
% |
Net interest income
(tax-equivalent) |
|
|
|
|
38,773 |
|
|
|
|
|
|
38,447 |
|
|
|
|
|
|
40,126 |
|
|
Net interest margin
(tax-equivalent) |
|
|
|
|
|
3.46 |
% |
|
|
|
|
|
3.55 |
% |
|
|
|
|
|
3.61 |
% |
Less tax-equivalent
adjustment |
|
|
|
|
271 |
|
|
|
|
|
|
354 |
|
|
|
|
|
|
347 |
|
|
Net interest income |
|
|
|
$ |
38,502 |
|
|
|
|
|
$ |
38,093 |
|
|
|
|
|
$ |
39,779 |
|
|
Net interest margin |
|
|
|
|
|
3.43 |
% |
|
|
|
|
|
3.52 |
% |
|
|
|
|
|
3.58 |
% |
(1) |
Average yields and interest income are presented on a
tax-equivalent basis, calculated using a U.S. federal income tax
rate of 21% for each period presented, based on tax-equivalent
adjustments associated with tax-exempt loans and investments
interest income. |
(2) |
Average loans and loans held for sale are presented at amortized
cost and include non-accrual loans. |
(3) |
Average investments are presented at average amortized cost. |
(4) |
Average other interest-earning assets include interest-earning
deposits with banks, federal funds sold and FHLB stock. |
(5) |
Subordinated debt is net of average deferred debt issuance
costs. |
|
|
Contact Info: Joseph R. Lussier, Executive Vice President, Chief
Financial Officer and Treasurer (978) 656-5578
Enterprise Bancorp (NASDAQ:EBTC)
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