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Brookline Bancorp Announces Fourth Quarter Results

BRKL

Net Income of $29.7 million, EPS of $0.39

BOSTON, Jan. 25, 2023 (GLOBE NEWSWIRE) -- Brookline Bancorp, Inc. (NASDAQ: BRKL) (the “Company”) today announced net income of $29.7 million, or $0.39 per basic and diluted share, for the fourth quarter of 2022, compared to $30.1 million, or $0.39 per basic and diluted share, for the third quarter of 2022, and $28.5 million, or $0.37 per basic and diluted share, for the fourth quarter of 2021.

For the year ended December 31, 2022, the Company reported net income of $109.7 million, or $1.42 per basic and diluted share. This compared to $115.4 million, or $1.48 per basic and diluted share, for the year ended December 31, 2021.

Paul Perrault, Chairman and Chief Executive Officer, commented on the Company’s performance, “Brookline Bancorp had an excellent year in 2022. We again finished the year with exceptional loan growth and are well positioned as we look forward to 2023. We are pleased to welcome PCSB Bank to our family of banks and look forward to their contributions to our Company in the years to come. I would like to recognize the continued contributions of our colleagues to our Company in 2022."

BALANCE SHEET

Total assets at December 31, 2022 increased $526.8 million to $9.2 billion from $8.7 billion at September 30, 2022, and increased $619.9 million from $8.6 billion at December 31, 2021.

At December 31, 2022, total loans and leases were $7.6 billion, representing an increase of $223.1 million from September 30, 2022, and an increase of $489.9 million from December 31, 2021. The loan portfolio grew $223.1 million in the fourth quarter compared to growth of $129.4 million in the third quarter.

Total investment securities at December 31, 2022 decreased $18.9 million to $656.8 million from $675.7 million at September 30, 2022, and decreased $64.1 million from $720.9 million at December 31, 2021. Total cash and cash equivalents at December 31, 2022 increased $270.5 million to $383.0 million from $112.5 million at September 30, 2022, and increased $55.3 million from $327.7 million at December 31, 2021. As of December 31, 2022, total investment securities and total cash and cash equivalents represented 11.3 percent of total assets as compared to 9.1 percent and 12.2 percent as of September 30, 2022 and December 31, 2021, respectively.

Total deposits at December 31, 2022 decreased $213.5 million to $6.5 billion from $6.7 billion at September 30, 2022 and decreased $527.8 million from $7.0 billion at December 31, 2021.

Total borrowed funds at December 31, 2022 increased $673.9 million to $1.4 billion from $0.8 billion at September 30, 2022 and increased $1.0 billion from $0.4 billion at December 31, 2021.

The ratio of stockholders’ equity to total assets was 10.76 percent at December 31, 2022, as compared to 11.08 percent at September 30, 2022, and 11.57 percent at December 31, 2021. The ratio of tangible stockholders’ equity to tangible assets (non-GAAP) was 9.16 percent at December 31, 2022, as compared to 9.39 percent at September 30, 2022, and 9.87 percent at December 31, 2021. Tangible book value per common share (non-GAAP) increased $0.37 from $10.43 at September 30, 2022 to $10.80 at December 31, 2022, compared to $10.73 at December 31, 2021.

NET INTEREST INCOME

Net interest income increased $2.0 million to $80.0 million during the fourth quarter of 2022 from $78.0 million for the quarter ended September 30, 2022. The net interest margin increased 1 basis point to 3.81 percent for the three months ended December 31, 2022 from 3.80 percent for the three months ended September 30, 2022.

NON-INTEREST INCOME

Total non-interest income for the quarter ended December 31, 2022 increased $2.3 million to $9.1 million from $6.8 million for the quarter ended September 30, 2022. The increase was primarily driven by increases of $1.7 million in gain on sales of loans and leases, $0.5 million in other non-interest income, $0.3 million in gain on securities, net, $0.2 million in deposit fees, and $0.1 million in loan fees, partially offset by a decrease of $0.6 million in loan level derivative income, net.

PROVISION FOR CREDIT LOSSES

The Company recorded a provision for credit losses of $5.7 million for the quarter ended December 31, 2022, compared to $2.8 million for the quarter ended September 30, 2022. The $2.9 million increase in provision for credit losses, or 3 cents per share after tax, was due to strong growth in loans and commitments.

Total net charge-offs for the fourth quarter of 2022 were $0.3 million compared to total net recoveries of $0.2 million in the third quarter of 2022. The increase was primarily driven by an increase in net charge-offs on equipment financing loans of $0.5 million. The ratio of net loan and lease charge-offs to average loans and leases on an annualized basis increased to 2 basis points for the fourth quarter of 2022 from a negative 1 basis point for the third quarter of 2022.

The allowance for loan and lease losses represented 1.29 percent of total loans and leases at December 31, 2022, compared to 1.27 percent at September 30, 2022, and 1.38 percent at December 31, 2021.

ASSET QUALITY

The ratio of total nonperforming loans and leases to total loans and leases was 0.19 percent at December 31, 2022 as compared to 0.24 percent at September 30, 2022. Total nonaccrual loans and leases decreased $2.8 million to $14.9 million at December 31, 2022 from $17.7 million at September 30, 2022. The ratio of nonperforming assets to total assets was 0.17 percent at December 31, 2022 as compared to 0.21 percent at September 30, 2022. Total nonperforming assets decreased $3.0 million to $15.3 million at December 31, 2022 from $18.3 million at September 30, 2022.

NON-INTEREST EXPENSE

Non-interest expense for the quarter ended December 31, 2022 increased $2.2 million to $47.2 million from $45.0 million for the quarter ended September 30, 2022. The increase was primarily driven by increases of $1.2 million in compensation and employee benefits, $0.7 million in equipment and data processing expense, $0.5 million in professional services expense, $0.3 million in FDIC insurance expense, $0.2 million in other non-interest expense, and $0.1 million in occupancy expense, partially offset by a decrease of $0.4 million in merger and acquisition expense and a decrease of $0.3 million in advertising and marketing expense.

PROVISION FOR INCOME TAXES

The effective tax rate was 17.8 percent and 21.6 percent for the three and twelve months ended December 31, 2022 compared to 18.7 percent for the three months ended September 30, 2022 and 25.9 percent and 25.3 percent for the three and twelve months ended December 31, 2021.

RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

The annualized return on average assets decreased to 1.34 percent during the fourth quarter of 2022 compared to 1.40 percent for the third quarter of 2022; and was 1.27 percent for the year ended December 31, 2022, compared to 1.36 percent for the year ended December 31, 2021.

The annualized return on average tangible stockholders' equity decreased to 14.48 percent during the fourth quarter of 2022 compared to 14.72 percent for the third quarter of 2022; and was 13.35 percent for the year ended December 31, 2022 compared to 14.35 percent for the year ended December 31, 2021.

DIVIDEND DECLARED

The Company’s Board approved a dividend of $0.135 per share for the quarter ended December 31, 2022. The dividend will be paid on February 24, 2023 to stockholders of record on February 10, 2023.

PCSB ACQUISITION

On January 1, 2023, the Company completed its previously announced acquisition (the “merger”) of PCSB Financial Corporation (“PCSB”). Pursuant to the merger agreement, each share of PCSB common stock outstanding at the effective time of the merger was converted into the right to receive, at the holder’s election, either $22.00 in cash consideration or 1.3284 shares of Company common stock for each share of PCSB common stock, subject to allocation procedures to ensure that 60% of the outstanding shares of PCSB common stock was converted to Company common stock. PCSB’s bank subsidiary, PCSB Bank, now operates as a separate subsidiary of the Company and has 15 banking offices throughout the Lower Hudson Valley of New York State.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30 PM Eastern Time on Thursday, January 26, 2023 to discuss the results for the quarter, business highlights and outlook. A copy of the Earnings Presentation is available on the Company’s website, www.brooklinebancorp.com. To listen to the call and view the Company’s Earnings Presentation, please join the call via https://events.q4inc.com/attendee/914981409. To listen to the call without access to the slides, please dial 844-200-6205 (United States) or 929-526-1599 (internationally) and ask for the Brookline Bancorp, Inc. call (Access Code 718736). A recording of the call will be available for one week following the call on the Company’s website under “Investor Relations” or by dialing 866-813-9403 (United States) or 929-458-6194 (internationally) and entering the passcode: 959089.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with approximately $11 billion in assets and branch locations in eastern Massachusetts, Rhode Island and the Lower Hudson Valley of New York State, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank, Bank Rhode Island, and PCSB Bank. The Company provides commercial and retail banking services and cash management and investment services to customers throughout Central New England and the Lower Hudson Valley of New York State. More information about Brookline Bancorp, Inc. and its banks can be found at the following websites: www.brooklinebank.com, www.bankri.com and www.pcsb.com.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release that are not historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in other documents we file with the Securities and Exchange Commission ("SEC"), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters, including statements regarding the Company’s business, credit quality, financial condition, liquidity and results of operations. Forward-looking statements may differ, possibly materially, from what is included in this press release due to factors and future developments that are uncertain and beyond the scope of the Company’s control. These include, but are not limited to, the Company’s ability to achieve the synergies and value creation contemplated by the acquisition of PCSB; turbulence in the capital and debt markets; changes in interest rates; competitive pressures from other financial institutions; general economic conditions (including inflation) on a national basis or in the local markets in which the Company operates; changes in consumer behavior due to changing political, business and economic conditions, or legislative or regulatory initiatives; changes in the value of securities and other assets in the Company’s investment portfolio; increases in loan and lease default and charge-off rates; the adequacy of allowances for loan and lease losses; decreases in deposit levels that necessitate increases in borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters, the ongoing COVID-19 pandemic and future pandemics; changes in regulation; the possibility that future credit losses may be higher than currently expected due to changes in economic assumptions and adverse economic developments; the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; and changes in assumptions used in making such forward-looking statements. Forward-looking statements involve risks and uncertainties which are difficult to predict. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the risks outlined in the Company’s Annual Report on Form 10-K, as updated by its Quarterly Reports on Form 10-Q and other filings submitted to the SEC. The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

BASIS OF PRESENTATION

The Company's consolidated financial statements have been prepared in conformity with generally accepted accounting principles (“GAAP”) as set forth by the Financial Accounting Standards Board in its Accounting Standards Codification and through the rules and interpretive releases of the SEC under the authority of federal securities laws. Certain amounts previously reported have been reclassified to conform to the current period's presentation.

NON-GAAP FINANCIAL MEASURES

The Company uses certain non-GAAP financial measures, such as operating earnings, operating earnings per common share, operating return on average assets, operating return on average tangible assets, operating return on average stockholders' equity, operating return on average tangible stockholders' equity, tangible book value per common share, tangible stockholders’ equity to tangible assets, return on average tangible assets (annualized) and return on average tangible stockholders' equity (annualized). These non-GAAP financial measures provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial services sector. A detailed reconciliation table of the Company's GAAP to the non-GAAP measures is attached.

INVESTOR RELATIONS:

Contact: Carl M. Carlson
Brookline Bancorp, Inc.
Co-President and Chief Financial Officer
(617) 425-5331
ccarlson@brkl.com



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Selected Financial Highlights (Unaudited)
At and for the Three Months Ended At and for the Twelve Months Ended
December 31, 2022 September 30, 2022 June 30,
2022
March 31, 2022 December 31, 2021 December 31, 2022 December 31, 2021
(Dollars In Thousands Except per Share Data)
Earnings Data:
Net interest income $ 80,030 $ 78,026 $ 71,867 $ 69,848 $ 71,461 $ 299,771 $ 282,373
Provision (credit) for credit losses 5,725 2,835 227 (160 ) 751 8,627 (7,837 )
Non-interest income 9,056 6,834 6,928 5,529 10,699 28,347 26,989
Non-interest expense 47,225 44,959 44,871 42,487 42,909 179,542 162,608
Income before provision for income taxes 36,136 37,066 33,697 33,050 38,500 139,949 154,591
Net income 29,695 30,149 25,195 24,705 28,545 109,744 115,440
Performance Ratios:
Net interest margin (1) 3.81 % 3.80 % 3.56 % 3.49 % 3.52 % 3.67 % 3.49 %
Interest-rate spread (1) 3.35 % 3.58 % 3.41 % 3.31 % 3.42 % 3.40 % 3.32 %
Return on average assets (annualized) 1.34 % 1.40 % 1.18 % 1.16 % 1.35 % 1.27 % 1.36 %
Return on average tangible assets (annualized) (non-GAAP) 1.37 % 1.43 % 1.21 % 1.18 % 1.38 % 1.30 % 1.38 %
Return on average stockholders' equity (annualized) 12.09 % 12.29 % 10.32 % 9.91 % 11.56 % 11.15 % 11.93 %
Return on average tangible stockholders' equity (annualized) (non-GAAP) 14.48 % 14.72 % 12.39 % 11.84 % 13.84 % 13.35 % 14.35 %
Efficiency ratio (2) 53.01 % 52.98 % 56.95 % 56.37 % 52.23 % 54.72 % 52.56 %
Per Common Share Data:
Net income — Basic $ 0.39 $ 0.39 $ 0.33 $ 0.32 $ 0.37 $ 1.42 $ 1.48
Net income — Diluted 0.39 0.39 0.33 0.32 0.37 1.42 1.48
Cash dividends declared 0.135 0.135 0.130 0.130 0.125 0.530 0.490
Book value per share (end of period) 12.91 12.54 12.63 12.65 12.82 12.91 12.82
Tangible book value per common share (end of period) (non-GAAP) 10.80 10.43 10.51 10.56 10.73 10.80 10.73
Stock price (end of period) 14.15 11.65 13.31 15.82 16.19 14.15 16.19
Balance Sheet:
Total assets $ 9,222,553 $ 8,695,708 $ 8,514,230 $ 8,633,736 $ 8,602,622 $ 9,222,553 $ 8,602,622
Total loans and leases 7,644,388 7,421,304 7,291,912 7,223,130 7,154,457 7,644,388 7,154,457
Total deposits 6,522,146 6,735,605 6,894,457 7,094,378 7,049,906 6,522,146 7,049,906
Total stockholders’ equity 992,125 963,618 968,496 981,935 995,342 992,125 995,342
Asset Quality:
Nonperforming assets $ 15,302 $ 18,312 $ 21,259 $ 26,506 $ 33,177 $ 15,302 $ 33,177
Nonperforming assets as a percentage of total assets 0.17 % 0.21 % 0.25 % 0.31 % 0.39 % 0.17 % 0.39 %
Allowance for loan and lease losses $ 98,482 $ 94,169 $ 93,188 $ 95,463 $ 99,084 $ 98,482 $ 99,084
Allowance for loan and lease losses as a percentage of total loans and leases 1.29 % 1.27 % 1.28 % 1.32 % 1.38 % 1.29 % 1.38 %
Net loan and lease charge-offs (recoveries) $ 310 $ (179 ) $ 1,242 $ 1,947 $ 2,124 $ 3,320 $ 5,734
Net loan and lease charge-offs as a percentage of average loans and leases (annualized) 0.02 % (0.01 )% 0.07 % 0.11 % 0.12 % 0.05 % 0.08 %
Capital Ratios:
Stockholders’ equity to total assets 10.76 % 11.08 % 11.38 % 11.37 % 11.57 % 10.76 % 11.57 %
Tangible stockholders’ equity to tangible assets (non-GAAP) 9.16 % 9.39 % 9.65 % 9.67 % 9.87 % 9.16 % 9.87 %
(1) Calculated on a fully tax-equivalent basis.
(2) Calculated as non-interest expense as a percentage of net interest income plus non-interest income.


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)
December 31, 2022 September 30, 2022 June 30, 2022 March 31, 2022 December 31, 2021
ASSETS (In Thousands Except Share Data)
Cash and due from banks $ 191,767 $ 65,638 $ 50,429 $ 89,032 $ 66,265
Short-term investments 191,192 46,873 39,900 204,239 261,472
Total cash and cash equivalents 382,959 112,511 90,329 293,271 327,737
Investment securities available-for-sale 656,766 675,692 717,818 730,562 720,866
Total investment securities 656,766 675,692 717,818 730,562 720,866
Loans and leases:
Commercial real estate loans 4,404,148 4,269,512 4,225,754 4,235,325 4,103,040
Commercial loans and leases 2,016,499 1,933,645 1,860,182 1,800,383 1,887,136
Consumer loans 1,223,741 1,218,147 1,205,976 1,187,422 1,164,281
Total loans and leases 7,644,388 7,421,304 7,291,912 7,223,130 7,154,457
Allowance for loan and lease losses (98,482) (94,169) (93,188) (95,463) (99,084)
Net loans and leases 7,545,906 7,327,135 7,198,724 7,127,667 7,055,373
Restricted equity securities 71,307 44,760 35,406 29,066 28,981
Premises and equipment, net of accumulated depreciation 71,391 69,912 69,557 69,365 70,359
Right-of-use asset operating leases 19,484 18,614 18,226 19,571 20,508
Deferred tax asset 52,237 56,894 50,736 46,886 38,987
Goodwill 160,427 160,427 160,427 160,427 160,427
Identified intangible assets, net of accumulated amortization 1,781 1,902 2,022 2,142 2,276
Other real estate owned and repossessed assets 408 591 507 990 718
Other assets 259,887 227,270 170,478 153,789 176,390
Total assets $ 9,222,553 $ 8,695,708 $ 8,514,230 $ 8,633,736 $ 8,602,622
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand checking accounts $ 1,802,518 $ 1,848,562 $ 1,845,365 $ 1,903,331 $ 1,888,462
NOW accounts 544,118 597,870 628,791 627,904 604,097
Savings accounts 762,271 824,789 894,926 967,183 915,804
Money market accounts 2,174,952 2,405,680 2,402,992 2,432,377 2,358,306
Certificate of deposit accounts 928,143 924,771 1,006,786 1,048,036 1,117,695
Brokered deposit accounts 310,144 133,933 115,597 115,547 165,542
Total deposits 6,522,146 6,735,605 6,894,457 7,094,378 7,049,906
Borrowed funds:
Advances from the FHLBB 1,237,823 557,895 307,967 201,236 147,907
Subordinated debentures and notes 84,044 84,008 83,970 83,934 83,897
Other borrowed funds 110,785 116,865 86,263 107,727 125,517
Total borrowed funds 1,432,652 758,768 478,200 392,897 357,321
Operating lease liabilities 19,484 18,614 18,226 19,571 20,508
Mortgagors’ escrow accounts 5,607 5,785 5,771 5,780 6,296
Reserve for unfunded credits 20,602 19,555 17,511 16,305 14,794
Accrued expenses and other liabilities 229,937 193,763 131,569 122,870 158,455
Total liabilities 8,230,428 7,732,090 7,545,734 7,651,801 7,607,280
Stockholders' equity:
Common stock, $0.01 par value; 200,000,000 shares authorized; 85,177,172 shares issued, 85,177,172 shares issued, 85,177,172 shares issued, 85,177,172 shares issued, and 85,177,172 shares issued, respectively 852 852 852 852 852
Additional paid-in capital 736,074 735,119 738,544 737,658 736,826
Retained earnings, partially restricted 412,019 392,779 372,677 357,576 342,639
Accumulated other comprehensive income (61,947) (70,227) (44,977) (29,322) (110)
Treasury stock, at cost;
7,731,445 shares, 7,730,945 shares, 7,995,888 shares, 7,037,464 shares, and 7,037,464 shares, respectively (94,873) (94,866) (98,525) (84,718) (84,718)
Unallocated common stock held by the Employee Stock Ownership Plan;
0 shares, 4,833 shares, 11,442 shares, 18,051 shares, and 24,660 shares, respectively 0 (39) (75) (111) (147)
Total stockholders' equity 992,125 963,618 968,496 981,935 995,342
Total liabilities and stockholders' equity $ 9,222,553 $ 8,695,708 $ 8,514,230 $ 8,633,736 $ 8,602,622


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
Three Months Ended
December 31, 2022 September 30, 2022 June 30, 2022 March 31, 2022 December 31, 2021
(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases $ 98,386 $ 84,375 $ 74,287 $ 71,721 $ 73,560
Debt securities 3,497 3,337 3,249 2,996 2,972
Marketable and restricted equity securities 766 467 337 328 325
Short-term investments 754 464 156 66 88
Total interest and dividend income 103,403 88,643 78,029 75,111 76,945
Interest expense:
Deposits 14,185 7,354 4,282 3,771 4,055
Borrowed funds 9,188 3,263 1,880 1,492 1,429
Total interest expense 23,373 10,617 6,162 5,263 5,484
Net interest income 80,030 78,026 71,867 69,848 71,461
Provision (credit) for credit losses 5,725 2,835 227 (160 ) 751
Net interest income after provision for credit losses 74,305 75,191 71,640 70,008 70,710
Non-interest income:
Deposit fees 2,916 2,759 2,744 2,500 2,653
Loan fees 446 349 666 747 448
Loan level derivative income, net 670 1,275 1,615 686 3,981
Gain (loss) on investment securities, net 321 (32 )
Gain on sales of loans and leases held-for-sale 2,612 889 291 344 1,933
Other 2,091 1,562 1,612 1,252 1,716
Total non-interest income 9,056 6,834 6,928 5,529 10,699
Non-interest expense:
Compensation and employee benefits 29,525 28,306 28,772 26,884 28,598
Occupancy 4,005 3,906 3,807 4,284 3,558
Equipment and data processing 5,758 5,066 4,931 5,078 4,576
Professional services 1,546 1,069 1,219 1,226 1,151
FDIC insurance 1,001 709 739 728 617
Advertising and marketing 1,052 1,337 1,319 1,272 880
Amortization of identified intangible assets 120 120 120 134 208
Merger and acquisition expense 641 1,073 535
Other 3,577 3,373 3,429 2,881 3,321
Total non-interest expense 47,225 44,959 44,871 42,487 42,909
Income before provision for income taxes 36,136 37,066 33,697 33,050 38,500
Provision for income taxes 6,441 6,917 8,502 8,345 9,955
Net income $ 29,695 $ 30,149 $ 25,195 $ 24,705 $ 28,545
Earnings per common share:
Basic $ 0.39 $ 0.39 $ 0.33 $ 0.32 $ 0.37
Diluted $ 0.39 $ 0.39 $ 0.33 $ 0.32 $ 0.37
Weighted average common shares outstanding during the period:
Basic 76,841,655 76,779,038 77,091,013 77,617,227 77,610,608
Diluted 77,065,076 77,007,971 77,419,288 77,926,822 77,864,097
Dividends paid per common share $ 0.135 $ 0.130 $ 0.130 $ 0.125 $ 0.125


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
Twelve Months Ended December 31,
2022 2021
(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases $ 328,769 $ 297,927
Debt securities 13,079 12,178
Marketable and restricted equity securities 1,898 1,172
Short-term investments 1,440 252
Total interest and dividend income 345,186 311,529
Interest expense:
Deposits 29,592 20,713
Borrowed funds 15,823 8,443
Total interest expense 45,415 29,156
Net interest income 299,771 282,373
Provision (credit) for credit losses 8,627 (7,837 )
Net interest income after provision for credit losses 291,144 290,210
Non-interest income:
Deposit fees 10,919 10,578
Loan fees 2,208 2,095
Loan level derivative income, net 4,246 4,680
Gain (loss) on investment securities, net 321 (38 )
Gain on sales of loans and leases held-for-sale 4,136 3,737
Other 6,517 5,937
Total non-interest income 28,347 26,989
Non-interest expense:
Compensation and employee benefits 113,487 106,786
Occupancy 16,002 14,961
Equipment and data processing 20,833 18,322
Professional services 5,060 4,694
FDIC insurance 3,177 2,980
Advertising and marketing 4,980 4,167
Amortization of identified intangible assets 494 876
Merger and acquisition expense 2,249
Other 13,260 9,822
Total non-interest expense 179,542 162,608
Income before provision for income taxes 139,949 154,591
Provision for income taxes 30,205 39,151
Net income $ 109,744 $ 115,440
Earnings per common share:
Basic $ 1.42 $ 1.48
Diluted $ 1.42 $ 1.48
Weighted average common shares outstanding during the period:
Basic 77,079,278 77,974,851
Diluted 77,351,834 78,243,416
Dividends paid per common share $ 0.520 $ 0.480


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Asset Quality Analysis (Unaudited)
At and for the Three Months Ended
December 31, 2022 September 30, 2022 June 30, 2022 March 31, 2022 December 31, 2021
(Dollars in Thousands)
NONPERFORMING ASSETS:
Loans and leases accounted for on a nonaccrual basis:
Commercial real estate mortgage $ 607 $ 3,136 $ 6,470 $ 8,313 $ 10,848
Construction 707
Total commercial real estate loans 1,314 3,136 6,470 8,313 10,848
Commercial 464 618 892 1,366 2,318
Equipment financing 9,653 10,544 10,183 11,685 15,014
Condominium association 58 64 71 77 84
Total commercial loans and leases 10,175 11,226 11,146 13,128 17,416
Residential mortgage 2,680 2,741 2,412 3,394 3,909
Home equity 723 616 721 680 285
Other consumer 2 2 3 1 1
Total consumer loans 3,405 3,359 3,136 4,075 4,195
Total nonaccrual loans and leases 14,894 17,721 20,752 25,516 32,459
Other repossessed assets 408 591 507 990 718
Total nonperforming assets $ 15,302 $ 18,312 $ 21,259 $ 26,506 $ 33,177
Loans and leases past due greater than 90 days and still accruing $ 33 $ 9,583 $ 266 $ 4 $ 1
Troubled debt restructurings on accrual 16,385 9,728 11,524 10,858 12,580
Troubled debt restructurings on nonaccrual 3,527 4,449 5,097 5,189 6,709
Total troubled debt restructurings $ 19,912 $ 14,177 $ 16,621 $ 16,047 $ 19,289
Nonperforming loans and leases as a percentage of total loans and leases 0.19 % 0.24 % 0.28 % 0.35 % 0.45 %
Nonperforming assets as a percentage of total assets 0.17 % 0.21 % 0.25 % 0.31 % 0.39 %
PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:
Allowance for loan and lease losses at beginning of period $ 94,169 $ 93,188 $ 95,463 $ 99,084 $ 102,515
Charge-offs (658 ) (598 ) (1,533 ) (2,344 ) (2,562 )
Recoveries 348 777 291 397 438
Net (charge-offs) recoveries (310 ) 179 (1,242 ) (1,947 ) (2,124 )
Provision (credit) for loan and lease losses excluding unfunded commitments * 4,623 802 (1,033 ) (1,674 ) (1,307 )
Allowance for loan and lease losses at end of period $ 98,482 $ 94,169 $ 93,188 $ 95,463 $ 99,084
Allowance for loan and lease losses as a percentage of total loans and leases 1.29 % 1.27 % 1.28 % 1.32 % 1.38 %
NET CHARGE-OFFS (RECOVERIES):
Commercial real estate loans $ (6 ) $ (6 ) $ (6 ) $ 31 $
Commercial loans and leases 320 (179 ) 1,254 1,948 2,143
Consumer loans (4 ) 6 (6 ) (32 ) (19 )
Total net charge-offs (recoveries) $ 310 $ (179 ) $ 1,242 $ 1,947 $ 2,124
Net loan and lease charge-offs as a percentage of average loans and leases (annualized) 0.02 % (0.01 )% 0.07 % 0.11 % 0.12 %
*Provision for loan and lease losses does not include provision of $1.0 million, $2.0 million, $1.2 million, $1.5 million, and $2.1 million for credit losses on unfunded commitments during the three months ended December 31, 2022, September 30, 2022, June 30, 2022, March 31, 2022, and December 31, 2021 respectively.



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
Three Months Ended
December 31, 2022 September 30, 2022 December 31, 2021
Average
Balance
Interest (1) Average
Yield/ Cost
Average
Balance
Interest (1) Average
Yield/ Cost
Average
Balance
Interest (1) Average
Yield/ Cost
(Dollars in Thousands)
Assets:
Interest-earning assets:
Investments:
Debt securities (2) $ 665,969 $ 3,497 2.10 % $ 714,226 $ 3,337 1.87 % $ 727,734 $ 2,972 1.63 %
Marketable and restricted equity securities (2) 52,093 766 5.88 % 36,525 467 5.12 % 27,019 325 4.81 %
Short-term investments 60,385 754 5.00 % 66,257 464 2.80 % 224,573 88 0.16 %
Total investments 778,447 5,017 2.58 % 817,008 4,268 2.09 % 979,326 3,385 1.38 %
Loans and Leases:
Commercial real estate loans (3) 4,341,929 53,088 4.78 % 4,239,155 44,729 4.13 % 3,996,647 35,762 3.50 %
Commercial loans (3) 797,312 10,541 5.18 % 731,095 8,492 4.55 % 820,932 10,146 4.84 %
Equipment financing (3) 1,200,911 20,816 6.93 % 1,157,829 19,042 6.58 % 1,092,457 18,175 6.65 %
Residential mortgage loans (3) 842,860 8,051 3.82 % 826,969 7,560 3.66 % 796,326 6,785 3.41 %
Other consumer loans (3) 382,196 5,940 6.15 % 379,999 4,605 4.80 % 368,087 2,751 2.96 %
Total loans and leases 7,565,208 98,436 5.20 % 7,335,047 84,428 4.60 % 7,074,449 73,619 4.16 %
Total interest-earning assets 8,343,655 103,453 4.96 % 8,152,055 88,696 4.35 % 8,053,775 77,004 3.82 %
Non-interest-earning assets 513,976 434,365 408,456
Total assets $ 8,857,631 $ 8,586,420 $ 8,462,231
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts $ 583,499 257 0.18 % $ 607,210 579 0.38 % $ 528,335 101 0.08 %
Savings accounts 787,021 1,155 0.58 % 881,988 664 0.30 % 897,821 219 0.10 %
Money market accounts 2,282,217 7,711 1.34 % 2,423,920 4,038 0.66 % 2,430,496 1,615 0.26 %
Certificates of deposit 922,250 2,865 1.23 % 964,112 1,803 0.74 % 1,129,645 2,072 0.73 %
Brokered deposit accounts 218,188 2,197 3.99 % 117,058 270 0.92 % 116,611 48 0.16 %
Total interest-bearing deposits 4,793,175 14,185 1.17 % 4,994,288 7,354 0.58 % 5,102,908 4,055 0.32 %
Borrowings:
Advances from the FHLBB 736,652 6,979 3.71 % 331,840 1,700 2.00 % 76,786 117 0.59 %
Subordinated debentures and notes 84,025 1,332 6.34 % 83,989 1,295 6.17 % 83,878 1,241 5.92 %
Other borrowed funds 148,195 877 2.35 % 89,019 268 1.20 % 112,137 71 0.25 %
Total borrowings 968,872 9,188 3.71 % 504,848 3,263 2.53 % 272,801 1,429 2.05 %
Total interest-bearing liabilities 5,762,047 23,373 1.61 % 5,499,136 10,617 0.77 % 5,375,709 5,484 0.40 %
Non-interest-bearing liabilities:
Demand checking accounts 1,843,780 1,908,459 1,892,763
Other non-interest-bearing liabilities 269,498 197,446 206,237
Total liabilities 7,875,325 7,605,041 7,474,709
Stockholders’ equity 982,306 981,379 987,522
Total liabilities and equity $ 8,857,631 $ 8,586,420 $ 8,462,231
Net interest income (tax-equivalent basis) /Interest-rate spread (4) 80,080 3.35 % 78,079 3.58 % 71,520 3.42 %
Less adjustment of tax-exempt income 50 53 59
Net interest income $ 80,030 $ 78,026 $ 71,461
Net interest margin (5) 3.81 % 3.80 % 3.52 %
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets.


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
Twelve Months Ended
December 31, 2022 December 31, 2021
Average
Balance
Interest (1) Average
Yield/ Cost
Average
Balance
Interest (1) Average
Yield/ Cost
(Dollars in Thousands)
Assets:
Interest-earning assets:
Investments:
Debt securities (2) $ 706,580 $ 13,079 1.85 % $ 729,147 $ 12,178 1.67 %
Marketable and restricted equity securities (2) 36,813 1,898 5.15 % 34,074 1,172 3.44 %
Short-term investments 104,288 1,440 1.38 % 217,784 252 0.12 %
Total investments 847,681 16,417 1.94 % 981,005 13,602 1.39 %
Loans and Leases:
Commercial real estate loans (3) 4,238,960 172,811 4.02 % 3,854,357 139,451 3.57 %
Commercial loans (3) 744,972 34,105 4.52 % 1,020,627 47,647 4.61 %
Equipment financing (3) 1,148,673 75,767 6.60 % 1,081,287 71,906 6.65 %
Residential mortgage loans (3) 823,512 29,726 3.61 % 788,614 27,933 3.54 %
Other consumer loans (3) 376,292 16,569 4.40 % 369,326 11,209 3.03 %
Total loans and leases 7,332,409 328,978 4.49 % 7,114,211 298,146 4.19 %
Total interest-earning assets 8,180,090 345,395 4.22 % 8,095,216 311,748 3.85 %
Non-interest-earning assets 443,313 422,984
Total assets $ 8,623,403 $ 8,518,200
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts $ 598,267 853 0.14 % $ 502,189 493 0.10 %
Savings accounts 882,881 2,228 0.25 % 793,141 950 0.12 %
Money market accounts 2,387,670 15,392 0.64 % 2,288,740 6,214 0.27 %
Certificates of deposit 998,580 8,210 0.82 % 1,210,451 11,758 0.97 %
Brokered deposit accounts 146,038 2,909 1.99 % 338,734 1,298 0.38 %
Total interest-bearing deposits 5,013,436 29,592 0.59 % 5,133,255 20,713 0.40 %
Borrowings:
Advances from the FHLBB 340,569 9,355 2.71 % 232,175 3,302 1.40 %
Subordinated debentures and notes 83,971 5,133 6.11 % 83,821 4,967 5.93 %
Other borrowed funds 118,383 1,335 1.13 % 88,818 174 0.20 %
Total borrowings 542,923 15,823 2.87 % 404,814 8,443 2.06 %
Total interest-bearing liabilities 5,556,359 45,415 0.82 % 5,538,069 29,156 0.53 %
Non-interest-bearing liabilities:
Demand checking accounts 1,879,620 1,787,959
Other non-interest-bearing liabilities 203,187 224,634
Total liabilities 7,639,166 7,550,662
Stockholders’ equity 984,237 967,538
Total liabilities and equity $ 8,623,403 $ 8,518,200
Net interest income (tax-equivalent basis) /Interest-rate spread (4) 299,980 3.40 % 282,592 3.32 %
Less adjustment of tax-exempt income 209 219
Net interest income $ 299,771 $ 282,373
Net interest margin (5) 3.67 % 3.49 %
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets.


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
At and for the Three Months
Ended December 31,
At and for the Twelve Months
Ended December 31,
2022 2021 2022 2021
Reconciliation Table - Non-GAAP Financial Information (Dollars in Thousands Except Share Data)
Net income $ 29,695 $ 28,545 $ 109,744 $ 115,440
Less:
Security gains (losses) (after-tax) 264 (24 ) 252 (28 )
Add:
Merger and acquisition expenses (after-tax) 527 1,763
Operating earnings $ 29,958 $ 28,569 $ 111,255 $ 115,468
Operating earnings per common share:
Basic $ 0.39 $ 0.37 $ 1.44 $ 1.48
Diluted 0.39 0.37 1.44 1.48
Weighted average common shares outstanding during the period:
Basic 76,841,655 77,610,608 77,079,278 77,974,851
Diluted 77,065,076 77,864,097 77,351,834 78,243,416
Return on average assets * 1.34 % 1.35 % 1.27 % 1.36 %
Less:
Security gains (after-tax) * 0.01 % % % %
Add:
Merger and acquisition expenses (after-tax) * 0.02 % % 0.02 % %
Operating return on average assets * 1.35 % 1.35 % 1.29 % 1.36 %
Return on average tangible assets * 1.37 % 1.38 % 1.30 % 1.38 %
Less:
Security gains (after-tax) * 0.01 % % % %
Add:
Merger and acquisition expenses (after-tax) * 0.02 % % 0.02 % %
Operating return on average tangible assets * 1.38 % 1.38 % 1.32 % 1.38 %
Return on average stockholders' equity * 12.09 % 11.56 % 11.15 % 11.93 %
Less:
Security gains (losses) (after-tax) * 0.11 % (0.01 )% 0.03 % %
Add:
Merger and acquisition expenses (after-tax) * 0.21 % % 0.18 % %
Operating return on average stockholders' equity * 12.19 % 11.57 % 11.30 % 11.93 %
Return on average tangible stockholders' equity * 14.48 % 13.84 % 13.35 % 14.35 %
Less:
Security gains (losses) (after-tax) * 0.13 % (0.01 )% 0.03 % %
Add:
Merger and acquisition expenses (after-tax) * 0.26 % % 0.21 % %
Operating return on average tangible stockholders' equity * 14.61 % 13.85 % 13.53 % 14.35 %
* Ratios at and for the three months ended are annualized.
BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
At and for the Three Months Ended At and for the Twelve Months Ended
December 31, 2022 September 30, 2022 June 30,
2022
March 31,
2022
December 31,
2021
December 31,
2022
December 31,
2021
(Dollars in Thousands)
Net income, as reported $ 29,695 $ 30,149 $ 25,195 $ 24,705 $ 28,545 $ 109,744 $ 115,440
Average total assets $ 8,857,631 $ 8,586,420 $ 8,515,330 $ 8,531,043 $ 8,462,231 $ 8,623,403 $ 8,518,200
Less: Average goodwill and average identified intangible assets, net 162,266 162,387 162,507 162,632 162,804 162,447 163,122
Average tangible assets $ 8,695,365 $ 8,424,033 $ 8,352,823 $ 8,368,411 $ 8,299,427 $ 8,460,956 $ 8,355,078
Return on average tangible assets (annualized) 1.37 % 1.43 % 1.21 % 1.18 % 1.38 % 1.30 % 1.38 %
Average total stockholders’ equity $ 982,306 $ 981,379 $ 976,167 $ 997,293 $ 987,522 $ 984,237 $ 967,538
Less: Average goodwill and average identified intangible assets, net 162,266 162,387 162,507 162,632 162,804 162,447 163,122
Average tangible stockholders’ equity $ 820,040 $ 818,992 $ 813,660 $ 834,661 $ 824,718 $ 821,790 $ 804,416
Return on average tangible stockholders’ equity (annualized) 14.48 % 14.72 % 12.39 % 11.84 % 13.84 % 13.35 % 14.35 %
Total stockholders’ equity $ 992,125 $ 963,618 $ 968,496 $ 981,935 $ 995,342 $ 992,125 $ 995,342
Less:
Goodwill 160,427 160,427 160,427 160,427 160,427 160,427 160,427
Identified intangible assets, net 1,781 1,902 2,022 2,142 2,276 1,781 2,276
Tangible stockholders' equity $ 829,917 $ 801,289 $ 806,047 $ 819,366 $ 832,639 $ 829,917 $ 832,639
Total assets $ 9,222,553 $ 8,695,708 $ 8,514,230 $ 8,633,736 $ 8,602,622 $ 9,222,553 $ 8,602,622
Less:
Goodwill 160,427 160,427 160,427 160,427 160,427 160,427 160,427
Identified intangible assets, net 1,781 1,902 2,022 2,142 2,276 1,781 2,276
Tangible assets $ 9,060,345 $ 8,533,379 $ 8,351,781 $ 8,471,167 $ 8,439,919 $ 9,060,345 $ 8,439,919
Tangible stockholders’ equity to tangible assets 9.16 % 9.39 % 9.65 % 9.67 % 9.87 % 9.16 % 9.87 %
Tangible stockholders' equity $ 829,917 $ 801,289 $ 806,047 $ 819,366 $ 832,639 $ 829,917 $ 832,639
Number of common shares issued 85,177,172 85,177,172 85,177,172 85,177,172 85,177,172 85,177,172 85,177,172
Less:
Treasury shares 7,731,445 7,730,945 7,995,888 7,037,464 7,037,464 7,731,445 7,037,464
Unallocated ESOP shares 0 4,833 11,442 18,051 24,660 0 24,660
Unvested restricted shares 601,495 601,995 497,297 500,098 500,098 601,495 500,098
Number of common shares outstanding 76,844,232 76,839,399 76,672,545 77,621,559 77,614,950 76,844,232 77,614,950
Tangible book value per common share $ 10.80 $ 10.43 $ 10.51 $ 10.56 $ 10.73 $ 10.80 $ 10.73

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