2014

BSB Bancorp, Inc. Reports Third Quarter Results - Crosses $1 Billion in Assets

BELMONT, Mass., Oct. 24, 2013 /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 $538,000, or $0.06 per basic and diluted share, for the quarter ended September 30, 2013, compared to net income of $183,000, or $0.02 per basic and diluted share in the third quarter of 2012.  For the nine months ended September 30, 2013, the Company reported net income of $1.3 million, or $0.15 per basic and diluted share, as compared to net income of $916,000, or $0.11 per basic and diluted share for the same period in 2012.

Robert M. Mahoney, President and Chief Executive Officer, said, "During the third quarter we experienced continued growth in loans, core deposits and earnings. The market is quite receptive to knowledgeable, customer centric community bankers.  Credit quality is good, as our local economy continues to improve and we are very proud to have crossed the $1 billion asset mark."

NET INTEREST AND DIVIDEND INCOME

Net interest and dividend income before provision for loan losses for the quarter ended September 30, 2013 was $6.8 million as compared to $5.6 million for the quarter ended September 30, 2012, a 19.9% increase. The provision for loan losses for the quarter ended September 30, 2013 was $438,000 as compared to a provision for loan losses of $734,000 for the quarter ended September 30, 2012, a 40.3% decrease. This resulted in a $1.4 million or 28.9% increase in net interest and dividend income after provision for loan losses for the quarter ended September 30, 2013 as compared to the quarter ended September 30, 2012.  Net interest and dividend income before provision for loan losses for the nine months ended September 30, 2013 was $18.5 million as compared to $15.8 million for the nine months ended September 30, 2012, a 16.6% increase. The provision for loan losses for the nine months ended September 30, 2013 was $865,000, as compared to $2.0 million for the nine months ended September 30, 2012, a 57.6% decrease. This resulted in a $3.8 million or 27.5% increase in net interest and dividend income after provision for loan losses period over period.

NONINTEREST INCOME

Noninterest income for the quarter ended September 30, 2013 was $890,000 as compared to $679,000 for the quarter ended September 30, 2012, an increase of $211,000, or 31.1%. This increase was primarily driven by an increase in loan servicing fee income of $55,000 and an increase in other income of $134,000. The increase in other income was primarily driven by an increase in vendor loss experience refunds of $75,000. For the nine months ended September 30, 2013, non-interest income was $2.8 million as compared to $3.1 million for the nine months ended September 30, 2012. This decrease of $327,000, or 10.4%, was primarily driven by a decrease in gains on sales of loans of $538,000, partially offset by an increase in loan servicing fee income of $159,000 and an increase in customer service fees of $97,000.

NONINTEREST EXPENSE

Noninterest expense for the quarter ended September 30, 2013 was $6.4 million as compared to $5.3 million for the quarter ended September 30, 2012.  This increase of $1.0 million, or 19.2%, was largely driven by an increase in salaries and employee benefits of $592,000, which increased $309,000 as a result of the 2012 Equity Incentive Plan that was adopted in the fourth quarter of 2012. Data processing expenses increased by $186,000 quarter over quarter, driven largely by increases in core and online banking costs as our customer base and transaction volume continue to see growth. Director compensation increased $144,000 primarily driven by an increase of $123,000 related to the 2012 Equity Incentive Plan. Noninterest expense for the nine months ended September 30, 2013 was $18.3 million as compared to $15.6 million for the nine months ended September 30, 2012. This increase of $2.7 million, or 17.5% was primarily driven by increases in salaries and employee benefits and director compensation of $1.5 million and $337,000, respectively, both of which had increased primarily as a result of the 2012 Equity Incentive Plan that was adopted in the fourth quarter of 2012. Data processing expenses also increased by $550,000, driven largely by increases in core and online banking costs.

BALANCE SHEET

At September 30, 2013, total assets were $1.0 billion, an increase of $185.0 million or 22.1% from December 31, 2012. Investments in held-to-maturity securities have increased by $57.4 million or 89.8% from December 31, 2012. The Company also experienced net loan growth, excluding loans held for sale, of $141.2 million, or 21.6%, from December 31, 2012. Commercial real estate, residential mortgage, home equity, and indirect auto loans increased by $44.2 million, $70.5 million, $13.3 million and $12.0 million, respectively. The asset growth was funded by deposits and borrowings from the Federal Home Loan Bank.

 At September 30, 2013, deposits totaled $727.0 million, an increase of $119.1 million or 19.6% from December 31, 2012. Core deposits, which we consider to include all deposits other than CD's and brokered CD's, increased by $113.3 million from December 31, 2012. Hal R. Tovin, Executive Vice President and Chief Operating Officer, said, "Deposit growth continued this quarter as our two new InStore branches in Cambridge and Newton were opened in June and August. In addition, the growing deposit relationships of new and existing commercial and small business customers, along with the momentum of our municipal banking program, contributed to this consistent, strong performance."

Total stockholders' equity decreased by $4.2 million from $133.3 million as of December 31, 2012 to $129.1 million as of September 30, 2013. This decrease is primarily the result of the Stock Repurchase Program that was adopted on December 12, 2012. During the nine months ended September 30, 2013, the Company purchased 476,622 shares of its common stock for $6.5 million and completed the Stock Repurchase Program. This was partially offset by earnings of $1.3 million.

ASSET QUALITY

The allowance for loan losses in total and as a percentage of total loans as of September 30, 2013 equaled $7.3 million and 0.92%, respectively, as compared to $6.4 million and 0.98%, respectively, as of December 31, 2012.  Total non-performing assets were $2.6 million, or 0.25% of total assets, as of September 30, 2013, as compared to $4.3 million, or 0.52% of total assets, as of December 31, 2012.

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 and businesses through its seven 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, legislative and regulatory changes that adversely affect the businesses in which the Company is engaged, changes in the securities market, and other factors that may be 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.











Contact:


Robert M. Mahoney





President and Chief Executive Officer








Phone:


617-484-6700



Email:


robert.mahoney@belmontsavings.com



 

BSB BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)








September 30,
2013


December 31,
2012







(unaudited)



ASSETS







Cash and due from banks



$                1,946


$                1,433

Interest-bearing deposits in other banks



46,870


51,279




Cash and cash equivalents



48,816


52,712

Interest-bearing time deposits with other banks



119


119

Investments in available-for-sale securities



21,804


22,621

Investments in held-to-maturity securities, at cost



121,426


63,984

Federal Home Loan Bank stock, at cost



7,650


7,627

Loans held-for-sale



-


11,205

Loans, net of allowance for loan losses of $7,325 as of 








9/30/2013 (unaudited) and $6,440 as of 12/31/2012



795,467


654,295

Premises and equipment, net



3,301


2,902

Accrued interest receivable



2,176


2,217

Deferred tax asset, net



4,951


4,025

Income taxes receivable



-


806

Bank-owned life insurance



13,203


12,884

Other real estate owned



-


661

Other assets



4,118


2,024




Total assets



$         1,023,031


$            838,082










LIABILITIES AND STOCKHOLDERS' EQUITY






Deposits:








Noninterest-bearing



$            134,145


$            126,760



Interest-bearing



592,857


481,105




Total deposits



727,002


607,865

Federal Home Loan Bank advances



150,600


83,100

Securities sold under agreements to repurchase



2,552


3,404

Other borrowed funds



1,124


1,156

Accrued interest payable



625


455

Deferred compensation liability



5,096


4,685

Income taxes payable



261


-

Other liabilities



6,622


4,109




Total liabilities



893,882


704,774










Stockholders' Equity:







Common stock



91


95


Additional paid-in capital



84,987


90,188


Retained earnings



48,667


47,352


Accumulated other comprehensive (loss) income



(314)


68


Unearned compensation - ESOP



(4,282)


(4,395)




Total stockholders' equity



129,149


133,308




Total liabilities and stockholders' equity



$         1,023,031


$            838,082










Asset Quality Data:






Total non-performing assets



2,590


4,325

Total non-performing loans



2,590


3,621

Non-performing loans to total loans



0.32%


0.55%

Non-performing assets to total assets



0.25%


0.52%

Allowance for loan losses to non-performing loans



282.81%


177.86%

Allowance for loan losses to total loans



0.92%


0.98%

 

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,







2013


2012


2013


2012







(unaudited)


(unaudited)

Interest and dividend income:










Interest and fees on loans


$        7,283


$       6,364


$      20,465


$      18,032


Interest on taxable debt securities


684


559


1,589


1,540


Dividends


7


10


21


38


Other interest income


21


18


61


72




Total interest and dividend income


7,995


6,951


22,136


19,682

Interest expense:










Interest on deposits


1,041


1,080


3,112


3,049


Interest on Federal Home Loan Bank advances


173


211


531


753


Interest on securities sold under agreements to repurchase


1


1


4


7


Interest on other borrowed funds


8


11


25


32




Total interest expense


1,223


1,303


3,672


3,841




Net interest and dividend income


6,772


5,648


18,464


15,841

Provision for loan losses


438


734


865


2,040




Net interest and dividend income after provision













 for loan losses


6,334


4,914


17,599


13,801

Noninterest income:










Customer service fees


252


216


710


613


Income from bank-owned life insurance


114


105


313


316


Net gain on sales of loans


168


191


968


1,506


Net gain on sales and calls of securities


-


-


34


-


Loan servicing fee income


192


137


489


330


Other income


164


30


290


366




Total noninterest income 


890


679


2,804


3,131

Noninterest expense:










Salaries and employee benefits


3,871


3,279


11,122


9,595


Director compensation


257


113


693


356


Occupancy expense


238


207


685


586


Equipment expense


156


110


454


319


Deposit insurance


156


114


430


367


Data processing


717


531


2,039


1,489


Professional fees


216


200


622


731


Marketing


214


265


662


743


Other expense


548


528


1,626


1,421




Total noninterest expense


6,373


5,347


18,333


15,607




Income before income tax expense


851


246


2,070


1,325

Income tax expense


313


63


755


409





Net income


$           538


$          183


$        1,315


$           916


Earnings per share













Basic


$          0.06


$         0.02


$          0.15


$          0.11





Diluted


$          0.06


$         0.02


$          0.15


$          0.11

Return on average assets


0.22%


0.09%


0.20%


0.17%

Return on average equity


1.67%


0.55%


1.35%


0.93%

Interest rate spread


2.70%


2.72%


2.64%


2.70%

Net interest margin


2.89%


3.00%


2.87%


2.98%

Efficiency ratio


83.18%


84.51%


86.20%


82.26%

SOURCE BSB Bancorp, Inc.



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http://www.belmontsavings.com

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