Arrow Reports Increase in Second Quarter Net Income, Record Loan Balances
- Second quarter net income increased 35.0% year-over-year to $9.7 million.
- Second quarter diluted earnings per share (EPS) rose 32.7% to $0.69.
- Period-end total loans reached a record high of $2.1 billion, up 9.5% year-over-year.
- Second quarter net interest income increased 9.0% over the prior-year comparable quarter.
- New record highs for total assets, total equity and assets under management and trust administration.
- Continued strong ratios for profitability, asset quality and capital.
GLENS FALLS, N.Y., July 23, 2018 /PRNewswire/ -- Arrow Financial Corporation (NasdaqGS® – AROW) announced operating results for the three-month period ended June 30, 2018. Net income for the second quarter of 2018 was $9.7 million, an increase of $2.5 million, or 35.0%, from net income of $7.2 million a year earlier. Diluted earnings per share (EPS) for the second quarter was $0.69, an increase of 32.7% from diluted EPS of $0.52 during the comparable 2017 quarter.
Annualized key profitability ratios also improved, as measured by a return on average equity (ROE) of 15.22% and a return on average assets (ROA) of 1.38% for the second quarter, compared to 12.08% and 1.08% a year earlier.
Arrow President and CEO Thomas J. Murphy said, "I am extremely proud of the Company's results, which are directly tied to the collective efforts of our team. Their commitment to driving results can be seen not only in our financial performance, but through countless hours of volunteer work for the benefit of our communities and service to local businesses and municipalities."
The following expands upon second quarter results:
Net Interest Income: Driven by strong loan growth and an increase in the net interest margin, second quarter 2018 net interest income increased to $21.0 million, up 9.0% from $19.2 million in the comparable quarter of 2017. The net interest margin was 3.11% for the quarter, as compared to 3.02% for the second quarter of 2017. This increase in net interest margin was the result of several factors, including higher market rates, an increase in the yield on earning assets and low deposit rate sensitivities on the funding side. On a tax equivalent (non-GAAP) basis, the net interest margin was 3.18%.
Loan Growth: During the second quarter of 2018, total loans grew by $64.8 million, or 3.3%, as compared to the first quarter of 2018, with the largest loan growth in the consumer and residential real estate segments. Over the 12 months ended June 30, 2018, total loans increased to a record high of $2.1 billion, up $179.2 million, or 9.5%, from the June 30, 2017 level.
The consumer loan portfolio grew by $83.2 million, or 14.4%, over the balance at June 30, 2017, primarily as a result of growth in the indirect automobile lending program. Total outstanding commercial loans were up $15.2 million, or 2.7%, from June 30, 2017. The residential real estate loan portfolio increased $80.9 million, or 11.1%, over the balance at June 30, 2017.
Deposit Growth: At June 30, 2018, deposit balances reached $2.3 billion, up $84.7 million, or 3.8%, from the prior-year level with growth in both personal and business balances. Noninterest-bearing deposits represented 20.3% of total deposits at June 30, 2018, compared to 19.5% at June 30, 2017.
Noninterest Income: Noninterest income for the three-month period ended June 30, 2018 increased 12.1% from the comparable 2017 quarter, mainly due to income from fiduciary activities, which increased during the quarter by $497 thousand, or 23.1%, over the amount for the second quarter of 2017. Additionally, net gain on equity securities of $223 thousand was the result of the change in fair value of marketable equity securities.
Assets Under Management: Assets under trust administration and investment management reached a record high of $1.5 billion at June 30, 2018, an increase of $123.5 million, or 9.1%, from the balance at June 30, 2017, driven by continued strength in equity markets.
Noninterest Expense: Noninterest expense for the second quarter of 2018 increased 3.5% to $16.2 million, from $15.6 million for the second quarter of 2017, primarily due to a 6.5% increase in salaries and employee benefits over the same 2017 quarter.
Provision for Income Taxes: The provision for income taxes was $2.3 million in the second quarter of 2018 versus $3.0 million in the same quarter of 2017. The effective income tax rates for the three-month periods ended June 30, 2018 and 2017 were 19.3% and 29.5%, respectively, which reflects the impact of the Tax Cuts and Jobs Act of 2017.
Asset Quality: Asset quality remained strong at June 30, 2018, as measured by continuing low levels of nonperforming assets and net charge-offs. Nonperforming assets at June 30, 2018 were $5.6 million, down $3.1 million, or 35.5%, from the level at June 30, 2017. Net charge-offs, expressed as an annualized percentage of average loans outstanding, were 0.01% for the three-month period ended June 30, 2018, down from the prior-year comparable quarter of 0.04%.
The allowance for loan losses was $19.6 million at June 30, 2018, which represented 0.95% of loans outstanding. The provision for loan losses for the second quarter of 2018 was $629 thousand, up $207 thousand from the provision for the comparable 2017 quarter, mainly due to growth in the loan portfolio.
Capital: Total stockholders' equity was a record $259.5 million at period-end, up $18.7 million, or 7.8%, from the prior year. Overall regulatory capital ratios also remain strong in 2018, with the Company's common equity tier 1 ratio estimated to be 13.01% and the total risk-based capital ratio estimated to be 15.06% at June 30, 2018. These capital levels at the Company and both its subsidiary banks continue to significantly exceed the "well capitalized" regulatory standard.
Cash and Stock Dividends: The Company distributed a cash dividend of $0.25 per share to shareholders in the second quarter of 2018. The cash dividend was 3% higher than the cash dividend paid in the second quarter of 2017 when adjusted for the 3.0% stock dividend distributed on September 28, 2017.
Industry Recognition: Both of the Company's banking subsidiaries maintained their BauerFinancial, Inc. 5-Star Superior Bank rating. Glens Falls National Bank and Trust Company and Saratoga National Bank and Trust Company have continued to earn this designation for the last 45 and 37 quarters, respectively. The Company was also included for the eighth consecutive year on American Banker's "Midtier Performers" list, ranking 31st out of more than 200 financial institutions. It is one of only three New York banks, and the only one from the Capital Region, to appear in the top 50.
About Arrow: Arrow Financial Corporation is a multi-bank holding company headquartered in Glens Falls, New York, serving the financial needs of northeastern New York. The Company is the parent of Glens Falls National Bank and Trust Company and Saratoga National Bank and Trust Company. Other subsidiaries include North Country Investment Advisers, Inc. and Upstate Agency, LLC.
Non-GAAP Financial Measures Reconciliation: In addition to presenting information in conformity with accounting principles generally accepted in the United States of America (GAAP), this news release contains financial information determined by methods other than GAAP (non-GAAP). The following measures used in this release, which are commonly utilized by financial institutions, have not been specifically exempted by the Securities and Exchange Commission ("SEC") and may constitute "non-GAAP financial measures" within the meaning of the SEC's rules. Certain non-GAAP financial measures include: tangible equity, return on tangible equity, tax-equivalent adjustment and related net interest income, tax-equivalent, and the efficiency ratio. Management believes that the non-GAAP financial measures disclosed by the Company from time to time are useful in evaluating the Company's performance and that such information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Non-GAAP financial measures may differ from similar measures presented by other companies. See the reconciliation of GAAP to non-GAAP measures in the section "Selected Quarterly Information."
Safe Harbor Statement: The information contained in this news release may contain statements that are not historical in nature but rather are based on management's beliefs, assumptions, expectations, estimates and projections about the future. These statements may be "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, involving a degree of uncertainty and attendant risk. In the case of all forward-looking statements, actual outcomes and results may differ materially from what the statements predict or forecast, explicitly or by implication. The Company undertakes no obligation to revise or update these forward-looking statements to reflect the occurrence of unanticipated events. This News Release should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2017, and other filings with the Securities and Exchange Commission.
|
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (In Thousands, Except Per Share Amounts - Unaudited | ||||||||||||||||
|
Three Months Ended June 30, |
Six Months Ended June 30, | |||||||||||||||
|
2018 |
2017 |
2018 |
2017 | |||||||||||||
|
INTEREST AND DIVIDEND INCOME |
||||||||||||||||
|
Interest and Fees on Loans |
$ |
19,909 |
$ |
17,295 |
$ |
38,767 |
$ |
33,697 |
||||||||
|
Interest on Deposits at Banks |
158 |
78 |
292 |
138 |
||||||||||||
|
Interest and Dividends on Investment Securities: |
||||||||||||||||
|
Fully Taxable |
2,048 |
2,013 |
3,941 |
4,003 |
||||||||||||
|
Exempt from Federal Taxes |
1,475 |
1,540 |
3,008 |
3,085 |
||||||||||||
|
Total Interest and Dividend Income |
23,590 |
20,926 |
46,008 |
40,923 |
||||||||||||
|
INTEREST EXPENSE |
||||||||||||||||
|
Interest-Bearing Checking Accounts |
388 |
381 |
775 |
712 |
||||||||||||
|
Savings Deposits |
711 |
316 |
1,233 |
607 |
||||||||||||
|
Time Deposits over $250,000 |
328 |
66 |
532 |
121 |
||||||||||||
|
Other Time Deposits |
282 |
233 |
541 |
461 |
||||||||||||
|
Federal Funds Purchased and Securities Sold |
16 |
9 |
32 |
16 |
||||||||||||
|
Federal Home Loan Bank Advances |
656 |
506 |
1,070 |
951 |
||||||||||||
|
Junior Subordinated Obligations Issued to Unconsolidated Subsidiary Trusts |
247 |
188 |
461 |
367 |
||||||||||||
|
Total Interest Expense |
2,628 |
1,699 |
4,644 |
3,235 |
||||||||||||
|
NET INTEREST INCOME |
20,962 |
19,227 |
41,364 |
37,688 |
||||||||||||
|
Provision for Loan Losses |
629 |
422 |
1,375 |
780 |
||||||||||||
|
NET INTEREST INCOME AFTER PROVISION FOR |
20,333 |
18,805 |
39,989 |
36,908 |
||||||||||||
|
NONINTEREST INCOME |
||||||||||||||||
|
Income From Fiduciary Activities |
2,647 |
2,150 |
4,844 |
4,168 |
||||||||||||
|
Fees for Other Services to Customers |
2,570 |
2,413 |
4,950 |
4,670 |
||||||||||||
|
Insurance Commissions |
2,192 |
2,115 |
4,095 |
4,313 |
||||||||||||
|
Net Gain on Equity Securities |
223 |
— |
241 |
— |
||||||||||||
|
Net Gain on Sales of Loans |
23 |
204 |
61 |
250 |
||||||||||||
|
Other Operating Income |
256 |
175 |
609 |
351 |
||||||||||||
|
Total Noninterest Income |
7,911 |
7,057 |
14,800 |
13,752 |
||||||||||||
|
NONINTEREST EXPENSE |
||||||||||||||||
|
Salaries and Employee Benefits |
9,812 |
9,211 |
19,181 |
18,358 |
||||||||||||
|
Occupancy Expenses, Net |
2,420 |
2,494 |
4,961 |
5,038 |
||||||||||||
|
FDIC Assessments |
223 |
228 |
440 |
454 |
||||||||||||
|
Other Operating Expense |
3,737 |
3,704 |
7,566 |
7,262 |
||||||||||||
|
Total Noninterest Expense |
16,192 |
15,637 |
32,148 |
31,112 |
||||||||||||
|
INCOME BEFORE PROVISION FOR INCOME TAXES |
12,052 |
10,225 |
22,641 |
19,548 |
||||||||||||
|
Provision for Income Taxes |
2,322 |
3,017 |
4,380 |
5,709 |
||||||||||||
|
NET INCOME |
$ |
9,730 |
$ |
7,208 |
$ |
18,261 |
$ |
13,839 |
||||||||
|
Average Shares Outstanding 1: |
||||||||||||||||
|
Basic |
13,975 |
13,890 |
13,955 |
13,889 |
||||||||||||
|
Diluted |
14,058 |
13,975 |
14,038 |
13,989 |
||||||||||||
|
Per Common Share: |
||||||||||||||||
|
Basic Earnings |
$ |
0.70 |
$ |
0.52 |
$ |
1.31 |
$ |
1.00 |
||||||||
|
Diluted Earnings |
0.69 |
0.52 |
1.30 |
0.99 |
||||||||||||
|
1 Share and per share data have been restated for the September 28, 2017, 3% stock dividend. | ||||||||||||||||
|
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In Thousands, Except Share and Per Share Amounts - Unaudited) | |||||||||||
|
June 30, |
December 31, |
June 30, | |||||||||
|
ASSETS |
|||||||||||
|
Cash and Due From Banks |
$ |
38,552 |
$ |
42,562 |
$ |
39,105 |
|||||
|
Interest-Bearing Deposits at Banks |
22,189 |
30,276 |
26,972 |
||||||||
|
Investment Securities: |
|||||||||||
|
Available-for-Sale |
325,387 |
300,200 |
327,392 |
||||||||
|
Held-to-Maturity (Approximate Fair Value of $292,605 at June 30, 2018; |
297,885 |
335,907 |
348,018 |
||||||||
|
Equity Securities |
1,802 |
— |
— |
||||||||
|
Other Investments |
11,089 |
9,949 |
11,035 |
||||||||
|
Loans |
2,057,862 |
1,950,770 |
1,878,632 |
||||||||
|
Allowance for Loan Losses |
(19,640) |
(18,586) |
(17,442) |
||||||||
|
Net Loans |
2,038,222 |
1,932,184 |
1,861,190 |
||||||||
|
Premises and Equipment, Net |
28,104 |
27,619 |
26,565 |
||||||||
|
Goodwill |
21,873 |
21,873 |
21,873 |
||||||||
|
Other Intangible Assets, Net |
2,060 |
2,289 |
2,482 |
||||||||
|
Other Assets |
58,008 |
57,606 |
57,089 |
||||||||
|
Total Assets |
$ |
2,845,171 |
$ |
2,760,465 |
$ |
2,721,721 |
|||||
|
LIABILITIES |
|||||||||||
|
Noninterest-Bearing Deposits |
$ |
467,048 |
$ |
441,945 |
$ |
433,480 |
|||||
|
Interest-Bearing Checking Accounts |
861,959 |
907,315 |
905,624 |
||||||||
|
Savings Deposits |
735,217 |
694,573 |
679,320 |
||||||||
|
Time Deposits over $250,000 |
70,950 |
38,147 |
33,630 |
||||||||
|
Other Time Deposits |
169,607 |
163,136 |
167,984 |
||||||||
|
Total Deposits |
2,304,781 |
2,245,116 |
2,220,038 |
||||||||
|
Federal Funds Purchased and Securities Sold Under Agreements to Repurchase |
60,248 |
64,966 |
40,892 |
||||||||
|
Federal Home Loan Bank Overnight Advances |
136,000 |
105,000 |
122,000 |
||||||||
|
Federal Home Loan Bank Term Advances |
45,000 |
55,000 |
55,000 |
||||||||
|
Junior Subordinated Obligations Issued to Unconsolidated |
20,000 |
20,000 |
20,000 |
||||||||
|
Other Liabilities |
19,654 |
20,780 |
23,039 |
||||||||
|
Total Liabilities |
2,585,683 |
2,510,862 |
2,480,969 |
||||||||
|
STOCKHOLDERS' EQUITY |
|||||||||||
|
Preferred Stock, $5 Par Value; 1,000,000 Shares Authorized |
— |
— |
— |
||||||||
|
Common Stock, $1 Par Value; 20,000,000 Shares Authorized (18,481,301 Shares Issued and Outstanding at June 30, 2018; 18,481,301 at December 31, 2017 and 17,943,201 at June 30, 2017) |
18,481 |
18,481 |
17,943 |
||||||||
|
Additional Paid-in Capital |
292,020 |
290,219 |
272,187 |
||||||||
|
Retained Earnings |
40,326 |
28,818 |
35,739 |
||||||||
|
Unallocated ESOP Shares (9,643 Shares at June 30, 2018; 9,643 Shares at December 31, 2017 and 19,466 Shares at June 30, 2017) |
(200) |
(200) |
(400) |
||||||||
|
Accumulated Other Comprehensive Loss |
(11,804) |
(8,514) |
(6,200) |
||||||||
|
Treasury Stock, at Cost (4,467,909 Shares at June 30, 2018; 4,541,524 Shares at December 31, 2017 and 4,428,713 Shares at June 30, 2017) |
(79,335) |
(79,201) |
(78,517) |
||||||||
|
Total Stockholders' Equity |
259,488 |
249,603 |
240,752 |
||||||||
|
Total Liabilities and Stockholders' Equity |
$ |
2,845,171 |
$ |
2,760,465 |
$ |
2,721,721 |
|||||
|
Arrow Financial Corporation Selected Quarterly Information (Dollars In Thousands, Except Per Share Amounts - Unaudited) | |||||||||||||||||||
|
Quarter Ended |
6/30/2018 |
3/31/2018 |
12/31/2017 |
9/30/2017 |
6/30/2017 |
||||||||||||||
|
Net Income |
9,730 |
8,531 |
8,071 |
7,416 |
7,208 |
||||||||||||||
|
Transactions Recorded in Net Income (Net of Tax): |
|||||||||||||||||||
|
Net (Loss) Gain on Securities Transactions |
— |
— |
(278) |
6 |
— |
||||||||||||||
|
Tax Benefit from Net Deferred Tax Liability Revaluation |
— |
— |
1,116 |
— |
— |
||||||||||||||
|
Share and Per Share Data:1 |
|||||||||||||||||||
|
Period End Shares Outstanding |
14,004 |
13,950 |
13,930 |
13,891 |
13,900 |
||||||||||||||
|
Basic Average Shares Outstanding |
13,975 |
13,936 |
13,905 |
13,889 |
13,890 |
||||||||||||||
|
Diluted Average Shares Outstanding |
14,058 |
14,016 |
14,006 |
13,966 |
13,975 |
||||||||||||||
|
Basic Earnings Per Share |
$ |
0.70 |
$ |
0.61 |
$ |
0.58 |
$ |
0.53 |
$ |
0.52 |
|||||||||
|
Diluted Earnings Per Share |
0.69 |
0.61 |
0.58 |
0.53 |
0.52 |
||||||||||||||
|
Cash Dividend Per Share |
0.250 |
0.250 |
0.250 |
0.243 |
0.243 |
||||||||||||||
|
Selected Quarterly Average Balances: |
|||||||||||||||||||
|
Interest-Bearing Deposits at Banks |
28,543 |
27,978 |
27,047 |
27,143 |
24,480 |
||||||||||||||
|
Investment Securities |
647,913 |
642,442 |
660,043 |
677,368 |
684,570 |
||||||||||||||
|
Loans |
2,026,598 |
1,971,240 |
1,930,590 |
1,892,766 |
1,842,543 |
||||||||||||||
|
Deposits |
2,325,202 |
2,305,736 |
2,284,206 |
2,193,778 |
2,206,365 |
||||||||||||||
|
Other Borrowed Funds |
219,737 |
184,613 |
187,366 |
262,864 |
207,270 |
||||||||||||||
|
Shareholders' Equity |
256,358 |
251,109 |
247,253 |
243,801 |
239,396 |
||||||||||||||
|
Total Assets |
2,823,061 |
2,763,706 |
2,744,180 |
2,725,653 |
2,677,843 |
||||||||||||||
|
Return on Average Assets, annualized |
1.38 |
% |
1.25 |
% |
1.17 |
% |
1.08 |
% |
1.08 |
% | |||||||||
|
Return on Average Equity, annualized |
15.22 |
% |
13.78 |
% |
12.95 |
% |
12.07 |
% |
12.08 |
% | |||||||||
|
Return on Average Tangible Equity, annualized |
16.80 |
% |
15.24 |
% |
14.36 |
% |
13.40 |
% |
13.45 |
% | |||||||||
|
Average Earning Assets |
2,703,054 |
2,641,660 |
2,617,680 |
2,597,277 |
2,551,593 |
||||||||||||||
|
Average Paying Liabilities |
2,100,085 |
2,050,661 |
2,029,811 |
2,012,802 |
2,005,421 |
||||||||||||||
|
Interest Income |
23,590 |
22,418 |
22,135 |
21,599 |
20,926 |
||||||||||||||
|
Tax-Equivalent Adjustment 3 |
468 |
491 |
980 |
966 |
949 |
||||||||||||||
|
Interest Income, Tax-Equivalent 3 |
24,058 |
22,909 |
23,115 |
22,565 |
21,875 |
||||||||||||||
|
Interest Expense |
2,628 |
2,016 |
1,821 |
1,949 |
1,699 |
||||||||||||||
|
Net Interest Income |
20,962 |
20,402 |
20,314 |
19,650 |
19,227 |
||||||||||||||
|
Net Interest Income, Tax-Equivalent 3 |
21,430 |
20,893 |
21,294 |
20,616 |
20,176 |
||||||||||||||
|
Net Interest Margin, annualized |
3.11 |
% |
3.13 |
% |
3.08 |
% |
3.00 |
% |
3.02 |
% | |||||||||
|
Net Interest Margin, Tax-Equivalent, annualized 3 |
3.18 |
% |
3.21 |
% |
3.23 |
% |
3.15 |
% |
3.17 |
% | |||||||||
|
Efficiency Ratio Calculation: 4 |
|||||||||||||||||||
|
Noninterest Expense |
16,192 |
15,955 |
16,045 |
15,548 |
15,637 |
||||||||||||||
|
Less: Intangible Asset Amortization |
66 |
67 |
69 |
69 |
70 |
||||||||||||||
|
Net Noninterest Expense |
16,126 |
15,888 |
15,976 |
15,479 |
15,567 |
||||||||||||||
|
Net Interest Income, Tax-Equivalent |
21,430 |
20,893 |
21,294 |
20,616 |
20,176 |
||||||||||||||
|
Noninterest Income |
7,911 |
6,888 |
6,752 |
7,141 |
7,057 |
||||||||||||||
|
Less: Net (Loss) Gain on Sales of Securities |
— |
— |
(458) |
10 |
— |
||||||||||||||
|
Less: Net Gain on Equity Securities |
223 |
18 |
— |
— |
— |
||||||||||||||
|
Net Gross Income |
29,118 |
27,763 |
28,504 |
27,747 |
27,233 |
||||||||||||||
|
Efficiency Ratio |
55.38 |
% |
57.23 |
% |
56.05 |
% |
55.79 |
% |
57.16 |
% | |||||||||
|
Period-End Capital Information: |
|||||||||||||||||||
|
Total Stockholders' Equity (i.e. Book Value) |
259,488 |
252,734 |
249,603 |
244,648 |
240,752 |
||||||||||||||
|
Book Value per Share 1 |
18.53 |
18.12 |
17.92 |
17.61 |
17.32 |
||||||||||||||
|
Goodwill and Other Intangible Assets, net |
23,933 |
24,045 |
24,162 |
24,268 |
24,355 |
||||||||||||||
|
Tangible Book Value per Share 1,2 |
16.82 |
16.39 |
16.18 |
15.86 |
15.57 |
||||||||||||||
|
Capital Ratios:5 |
|||||||||||||||||||
|
Tier 1 Leverage Ratio |
9.65 |
% |
9.62 |
% |
9.49 |
% |
9.30 |
% |
9.35 |
% | |||||||||
|
Common Equity Tier 1 Capital Ratio |
13.01 |
% |
12.97 |
% |
12.89 |
% |
12.70 |
% |
12.68 |
% | |||||||||
|
Tier 1 Risk-Based Capital Ratio |
14.04 |
% |
14.03 |
% |
13.97 |
% |
13.79 |
% |
13.79 |
% | |||||||||
|
Total Risk-Based Capital Ratio |
15.06 |
% |
15.04 |
% |
14.99 |
% |
14.77 |
% |
14.77 |
% | |||||||||
|
Assets Under Trust Administration and Investment Management |
$ |
1,479,753 |
$ |
1,470,191 |
$ |
1,452,994 |
$ |
1,411,608 |
$ |
1,356,262 |
|||||||||
|
Arrow Financial Corporation Selected Quarterly Information - Continued (Dollars In Thousands, Except Per Share Amounts - Unaudited) | ||||||||||||||||||||
|
Footnotes: |
||||||||||||||||||||
|
1. |
Share and Per Share Data have been restated for the September 28, 2017, 3% stock dividend. | |||||||||||||||||||
|
2. |
Non-GAAP Financial Measures Reconciliation: Tangible Book Value and Tangible Equity exclude goodwill and other intangible assets, net from total equity. These are non-GAAP financial measures which we believe provide investors with information that is useful in understanding our financial performance. | |||||||||||||||||||
|
6/30/2018 |
3/31/2018 |
12/31/2017 |
9/30/2017 |
6/30/2017 | ||||||||||||||||
|
Total Stockholders' Equity (GAAP) |
259,488 |
252,734 |
249,603 |
244,648 |
240,752 |
|||||||||||||||
|
Less: Goodwill and Other Intangible assets, net |
23,933 |
24,045 |
24,162 |
24,268 |
24,355 |
|||||||||||||||
|
Tangible Equity (Non-GAAP) |
$ |
235,555 |
$ |
228,689 |
$ |
225,441 |
$ |
220,380 |
$ |
216,397 |
||||||||||
|
Period End Shares Outstanding |
14,004 |
13,950 |
13,930 |
13,891 |
13,900 |
|||||||||||||||
|
Tangible Book Value per Share (Non-GAAP) |
$ |
16.82 |
$ |
16.39 |
$ |
16.18 |
$ |
15.86 |
$ |
15.57 |
||||||||||
|
3. |
Non-GAAP Financial Measures Reconciliation: Net Interest Margin, Tax-Equivalent is the ratio of our annualized tax-equivalent net interest income to average earning assets. This is also a non-GAAP financial measure which we believe provides investors with information that is useful in understanding our financial performance. | |||||||||||||||||||
|
6/30/2018 |
3/31/2018 |
12/31/2017 |
9/30/2017 |
6/30/2017 | ||||||||||||||||
|
Net Interest Income (GAAP) |
20,962 |
20,402 |
20,314 |
19,650 |
19,227 |
|||||||||||||||
|
Add: Tax-Equivalent adjustment (Non-GAAP) |
468 |
491 |
980 |
966 |
949 |
|||||||||||||||
|
Net Interest Income, Tax-Equivalent (Non-GAAP) |
$ |
21,430 |
$ |
20,893 |
$ |
21,294 |
$ |
20,616 |
$ |
20,176 |
||||||||||
|
Average Earning Assets |
2,703,054 |
2,641,660 |
2,617,680 |
2,597,277 |
2,551,593 |
|||||||||||||||
|
Net Interest Margin (Non-GAAP)* |
3.18 |
% |
3.21 |
% |
3.23 |
% |
3.15 |
% |
3.17 |
% | ||||||||||
|
4. |
Non-GAAP Financial Measures: Financial Institutions often use the "efficiency ratio", a non-GAAP ratio, as a measure of expense control. We believe the efficiency ratio provides investors with information that is useful in understanding our financial performance. We define our efficiency ratio as the ratio of our noninterest expense to our net gross income (which equals our tax-equivalent net interest income plus noninterest income, as adjusted). | |||||||||||||||||||
|
5. |
For the current quarter, all of the regulatory capital ratios in the table above, as well as the Total Risk-Weighted Assets and Common Equity Tier 1 Capital amounts listed in the table below, are estimates based on, and calculated in accordance with, bank regulatory capital rules. All prior quarters reflect actual results. The June 30, 2018 CET1 ratio listed in the tables (i.e., 13.01%) exceeds the sum of the required minimum CET1 ratio plus the fully phased-in Capital Conservation Buffer (i.e., 7.00%). | |||||||||||||||||||
|
6/30/2018 |
3/31/2018 |
12/31/2017 |
9/30/2017 |
6/30/2017 | ||||||||||||||||
|
Total Risk Weighted Assets |
1,934,890 |
1,889,719 |
1,856,242 |
1,830,730 |
1,802,455 |
|||||||||||||||
|
Common Equity Tier 1 Capital |
259,488 |
265,066 |
259,378 |
232,473 |
228,586 |
|||||||||||||||
|
Common Equity Tier 1 Ratio |
13.01 |
% |
12.97 |
% |
12.89 |
% |
12.70 |
% |
12.68 |
% | ||||||||||
|
* Quarterly ratios have been annualized |
||||||||||||||||||||
|
Arrow Financial Corporation Consolidated Financial Information (Dollars in Thousands - Unaudited) | |||||||||||
|
Quarter Ended: |
06/30/2018 |
12/31/2017 |
6/30/2017 | ||||||||
|
Loan Portfolio |
|||||||||||
|
Commercial Loans |
$ |
118,881 |
$ |
129,249 |
$ |
126,259 |
|||||
|
Commercial Real Estate Loans |
464,394 |
444,248 |
441,809 |
||||||||
|
Subtotal Commercial Loan Portfolio |
583,275 |
573,497 |
568,068 |
||||||||
|
Consumer Loans |
661,908 |
602,827 |
578,754 |
||||||||
|
Residential Real Estate Loans |
812,679 |
774,446 |
731,810 |
||||||||
|
Total Loans |
$ |
2,057,862 |
$ |
1,950,770 |
$ |
1,878,632 |
|||||
|
Allowance for Loan Losses |
|||||||||||
|
Allowance for Loan Losses, Beginning of Quarter |
$ |
19,057 |
$ |
17,695 |
$ |
17,216 |
|||||
|
Loans Charged-off |
(264) |
(363) |
(305) |
||||||||
|
Less Recoveries of Loans Previously Charged-off |
218 |
97 |
109 |
||||||||
|
Net Loans Charged-off |
(46) |
(266) |
(196) |
||||||||
|
Provision for Loan Losses |
629 |
1,157 |
422 |
||||||||
|
Allowance for Loan Losses, End of Quarter |
$ |
19,640 |
$ |
18,586 |
$ |
17,442 |
|||||
|
Nonperforming Assets |
|||||||||||
|
Nonaccrual Loans |
$ |
3,880 |
$ |
5,526 |
$ |
5,222 |
|||||
|
Loans Past Due 90 or More Days and Accruing |
170 |
319 |
1,821 |
||||||||
|
Loans Restructured and in Compliance with Modified Terms |
106 |
105 |
101 |
||||||||
|
Total Nonperforming Loans |
4,156 |
5,950 |
7,144 |
||||||||
|
Repossessed Assets |
76 |
109 |
90 |
||||||||
|
Other Real Estate Owned |
1,412 |
1,738 |
1,523 |
||||||||
|
Total Nonperforming Assets |
$ |
5,644 |
$ |
7,797 |
$ |
8,757 |
|||||
|
Key Asset Quality Ratios |
|||||||||||
|
Net Loans Charged-off to Average Loans, Quarter-to-date Annualized |
0.01 |
% |
0.05 |
% |
0.04 |
% | |||||
|
Provision for Loan Losses to Average Loans, Quarter-to-date Annualized |
0.12 |
% |
0.24 |
% |
0.09 |
% | |||||
|
Allowance for Loan Losses to Period-End Loans |
0.95 |
% |
0.95 |
% |
0.93 |
% | |||||
|
Allowance for Loan Losses to Period-End Nonperforming Loans |
472.57 |
% |
312.37 |
% |
244.15 |
% | |||||
|
Nonperforming Loans to Period-End Loans |
0.20 |
% |
0.31 |
% |
0.38 |
% | |||||
|
Nonperforming Assets to Period-End Assets |
0.20 |
% |
0.28 |
% |
0.32 |
% | |||||
|
Six-Month Period Ended: |
|||||||||||
|
Allowance for Loan Losses |
|||||||||||
|
Allowance for Loan Losses, Beginning of Year |
$ |
18,586 |
$ |
17,012 |
|||||||
|
Loans Charged-off |
(634) |
(574) |
|||||||||
|
Less Recoveries of Loans Previously Charged-off |
313 |
224 |
|||||||||
|
Net Loans Charged-off |
(321) |
(350) |
|||||||||
|
Provision for Loan Losses |
1,375 |
780 |
|||||||||
|
Allowance for Loan Losses, End of Period |
$ |
19,640 |
$ |
17,442 |
|||||||
|
Key Asset Quality Ratios |
|||||||||||
|
Net Loans Charged-off to Average Loans, Annualized |
0.03 |
% |
0.04 |
% | |||||||
|
Provision for Loan Losses to Average Loans, Annualized |
0.14 |
% |
0.09 |
% | |||||||
SOURCE Arrow Financial Corporation
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