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Press Release

Bridge Bancorp, Inc. Reports First Quarter 2019 Results

Company Release - 4/23/2019 4:15 PM ET

BRIDGEHAMPTON, N.Y., April 23, 2019 (GLOBE NEWSWIRE) -- Bridge Bancorp, Inc. (NASDAQ: BDGE), (the “Company”), the parent company of BNB Bank (“BNB”), today announced first quarter results for 2019.

The Company's first quarter 2019 financial results included:

  • Net income for the 2019 first quarter of $12.9 million, or $0.65 per diluted share, compared to $12.1 million, or $0.61 per diluted share for the 2018 first quarter.
  • Net interest income for the 2019 first quarter increased $0.2 million over the 2018 fourth quarter to $34.3 million, with a tax-equivalent net interest margin of 3.29%.
  • Adjusted net interest margin (excluding purchase accounting) increased from 3.21% in the 2018 fourth quarter to 3.24% in the 2019 first quarter.
  • Total assets of $4.7 billion at March 31, 2019, 4% higher than March 31, 2018.
  • Loan growth of $189 million, or 6%, compared to March 31, 2018, and $115 million, or 14% annualized, from December 31, 2018.
  • Non-public, non-brokered deposit growth of $404 million, or 16%, compared to March 31, 2018.
  • Non-performing assets of $3.2 million at March 31, 2019, $3.0 million lower than March 31, 2018 and $0.3 million higher than December 31, 2018. Loan loss reserve coverage to total loans of 0.94% at March 31, 2019.
  • All capital ratios remain strong. Declared a dividend of $0.23 during the quarter.

Commenting on the first quarter results, Kevin O’Connor, President and CEO said, “We opened the year with another successful quarter: record revenue, strong loan growth, and an expanding margin.  Our community banking model, built on relationships and our core businesses, continues to deliver consistent results- even in this challenging interest rate environment.”

Net Earnings and Returns
Net income in the 2019 first quarter was $12.9 million, or $0.65 per diluted share, an increase of $0.8 million compared to the 2018 first quarter, driven primarily by a rise in non-interest income and lower provision for loan losses, partially offset by a decline in net interest income.

Returns on average assets and equity in the 2019 first quarter were 1.13% and 11.41%, respectively.  Return on average tangible common equity was 15.01% for the 2019 first quarter.

Net Interest Income
Interest income was $44.5 million in the 2019 first quarter, an increase of $1.0 million compared to the 2018 fourth quarter, driven primarily by loan portfolio growth and higher loan and investment portfolio yields. Interest expense was $10.2 million in the 2019 first quarter, an increase of $0.8 million compared to the 2018 fourth quarter, primarily due to deposit growth and an increase in average cost of interest-bearing liabilities.

The impact of purchase accounting on the net interest margin continues to decrease.  The tax-equivalent net interest margin for the 2019 first quarter showed a year-over-year decline of 13 basis points to 3.29% in 2019 from 3.42% in 2018. However, the adjusted net interest margin, excluding purchase accounting, is up 2 basis points to 3.24% from 3.22% in 2018.  The decreased impact of purchase accounting can also be observed regarding loan yields.  Reported 2019 first quarter loan yields showed a year-over-year increase of 4 basis points from 4.62% in 2018 to 4.66% in 2019, while yields excluding purchase accounting increased 25 basis points to 4.61% in 2019 from 4.36% in 2018.

                 
  Three Months Ended   Change Compared To
  March 31,  December 31,  March 31,   December 31,  March 31, 
  2019 2018 2018  2018 2018
Average yield on loans, tax-equivalent basis - as reported   4.66  4.56  4.62   10bp  4 bp
Adjusted average yield on loans (non-GAAP)   4.61   4.50   4.36    11   25 
                 
Net interest margin - as reported (1)   3.27  3.25  3.40   2bp  (13) bp
Net interest margin, tax-equivalent basis (2)   3.29   3.26   3.42    3   (13) bp
Adjusted net interest margin (non-GAAP) (3)   3.24   3.21   3.22    3   2 

_________________________________

(1) Net interest margin represents net interest income divided by average interest-earning assets.
(2) Net interest margin, tax-equivalent basis represents net interest income on a tax-equivalent basis divided by average interest-earning assets.
(3) Adjusted net interest margin represents adjusted net interest income on a tax-equivalent basis divided by adjusted average interest-earning assets.

“BNB’s focus on providing banking services to businesses in our footprint results in significant levels of floating rate loans and non-interest-bearing demand deposit balances. Both factors sustain and grow our net interest margin,” stated Mr. O’Connor.

Provision for Loan Losses
The provision for loan losses was $0.6 million for the 2019 first quarter, $0.2 million lower than the 2018 first quarter.  Contributing to the lower provision was continued improved overall credit metrics throughout 2018, partially offset by an increase in net charge-offs in the 2019 first quarter compared to the same period in 2018. The Company recognized net charge-offs of $0.2 million in the 2019 first quarter, compared to recoveries of $0.3 million in the 2018 first quarter.

Non-Interest Income
Non-interest income was $5.2 million for the 2019 first quarter, $1.1 million higher than the 2018 first quarter, primarily attributable to higher loan swap fee income reported in other operating income and higher service charges and other fees, partially offset by lower title fee income and gain on sale of Small Business Administration (“SBA”) loans.  

Non-Interest Expense
Non-interest expense for the 2019 first quarter of $22.6 million was flat compared to the 2018 first quarter. Growth in salaries and benefits expense, and occupancy and equipment costs were offset by lower professional services and other operating expenses. 

Income Tax Expense
Income tax expense was $3.4 million in the 2019 first quarter, an increase of $0.2 million compared to the 2018 first quarter. The Company estimates it will record income tax at an effective tax rate of approximately 22% for the remainder of 2019. 

Balance Sheet
Total assets were $4.7 billion at March 31, 2019, $25.5 million lower than December 31, 2018, and $174.6 million higher than March 31, 2018. Total loans at March 31, 2019 of $3.4 billion reflect growth of $189.2 million, or 6%, over March 31, 2018. Deposits totaled $3.7 billion at March 31, 2019, an increase of $294.2 million, or 9%, over March 31, 2018. Demand deposits increased $89.9 million year-over-year to $1.3 billion at March 31, 2019, representing 35% of total deposits.

The allowance for loan losses was $31.8 million at March 31, 2019, $1.0 million lower than March 31, 2018. The allowance as a percentage of loans was 0.94% at March 31, 2019, compared to 1.02% at March 31, 2018. The March 31, 2018 allowance for loan losses included a $1.7 million specific reserve for a fully reserved impaired loan which was charged-off in the 2018 second quarter.

Stockholders’ equity was $465.0 million at March 31, 2019, $31.7 million higher than March 31, 2018. The growth reflects earnings, partially offset by shareholders’ dividends. Book value per share was $23.43 at March 31, 2019, $1.52 higher than March 31, 2018. Tangible book value per share was $17.88 at March 31, 2019, $1.58 higher than March 31, 2018.

                 
           Change Compared To 
  March 31,  December 31,  March 31,  December 31, March 31,  
(Dollars in thousands) 2019 2018 2018 2018 2018 
Total assets $ 4,675,209 $ 4,700,744 $ 4,500,624 $ (25,535) $ 174,585  
Total stockholders' equity   465,003   453,830   433,323   11,173    31,680  
                 
Loans held for investment                
Investor commercial real estate ("CRE") $ 859,797 $ 863,158 $ 856,797 $ (3,361) $ 3,000  
Multi-family ("MF")   624,114   585,827   601,747   38,287    22,367  
Construction and land ("C&L")   147,116   123,393   104,496   23,723    42,620  
Total investor CRE, MF, and C&L   1,631,027   1,572,378   1,563,040   58,649    67,987  
                 
Commercial and industrial ("C&I")   671,897   645,724   638,711   26,173    33,186  
Owner-occupied CRE   542,836   510,398   483,195   32,438    59,641  
Total C&I and owner-occupied CRE   1,214,733   1,156,122   1,121,906   58,611    92,827  
                 
Residential real estate   515,173   519,763   493,153   (4,590)   22,020  
Installment and consumer   22,781   20,509   19,078   2,272    3,703  
Net deferred loan costs and fees   7,390   7,039   4,720   351    2,670  
Total loans held for investment $ 3,391,104 $ 3,275,811 $ 3,201,897 $ 115,293  $ 189,207  
                 
Deposits                
Total IPC deposits $ 2,974,282 $ 2,965,007 $ 2,570,079 $ 9,275  $ 404,203  
Total public and brokered deposits   751,182   921,386   861,166   (170,204)   (109,984) 
Total deposits $ 3,725,464 $ 3,886,393 $ 3,431,245 $ (160,929) $ 294,219  
 

“Our balance sheet management strategies over the past year and quarter exemplify our commitment to our Community Banking franchise.  We have channeled our efforts in supporting local businesses by providing capital through C&I loans and financing their facilities through owner-occupied CRE loans, growing this business at an annual rate of 26% this quarter.  The expansion of these loan types has outpaced investor CRE loans.  Additionally, we have decreased our reliance on wholesale brokered deposits, using the strong deposit growth in the fourth quarter 2018 to fund growth in this quarter,” Mr. O’Connor said.

Asset Quality
Asset quality measures improved, as non-performing assets were $3.2 million, or 0.07% of total assets, at March 31, 2019, compared to $6.3 million, or 0.14% of total assets, at March 31, 2018. Non-performing assets at March 31, 2019 and 2018 included $175 thousand of other real estate owned. Non-performing loans were $3.1 million, or 0.09% of total loans at March 31, 2019, compared to $6.1 million, or 0.19% of total loans at March 31, 2018.  Loans 30 to 89 days past due increased $13.4 million to $17.9 million at March 31, 2019, compared to $4.5 million at March 31, 2018. The increase in these past due loans is primarily due to one CRE relationship which has more than sufficient collateral protection. Loans past due 90 days and accruing at March 31, 2019 and 2018 were comprised of acquired loans of $0.3 million and $2.7 million, respectively.

Conference Call
The Company will host a conference call on Wednesday, April 24, 2019 at 10:00 AM (ET). Investors who would like to join the conference call are encouraged to pre-register using the following link: http://dpregister.com/10130336. Callers who pre-register will be given a unique PIN to gain immediate access to the call and bypass the live operator. Participants may pre-register at any time, including up to and after the call start time. Telephonic replay will be available through the Company’s website approximately one hour after the conclusion of the call through Wednesday, May 8, 2019.

Call and replay information are as follows:

Call Date: Wednesday, April 24, 2019
Call Time: 10:00 AM (ET)
Domestic Call Dial In:  1-888-317-6016
International Call Dial In:  1-412-317-6016

Replay Domestic Dial In:  1-877-344-7529
Replay International Dial In:  1-412-317-0088
Access Code: 10130336

About Bridge Bancorp, Inc.
Bridge Bancorp, Inc. is a bank holding company engaged in commercial banking and financial services through its wholly owned subsidiary, BNB Bank, formerly known as The Bridgehampton National Bank. Established in 1910, BNB, with assets of approximately $4.7 billion, operates 39 branch locations serving Long Island and the greater New York metropolitan area. In addition, BNB operates one loan production office in Manhattan. Through its branch network and its electronic delivery channels, BNB provides deposit and loan products and financial services to local businesses, consumers and municipalities. Title insurance services are offered through BNB's wholly owned subsidiary, Bridge Abstract. Bridge Financial Services, Inc., a wholly owned subsidiary of BNB, offers financial planning and investment consultation.  For more information visit www.bnbbank.com.

BNB also has a rich tradition of involvement in the community, supporting programs and initiatives that promote local business, the environment, education, healthcare, social services and the arts.

Please see the attached tables for selected financial information.

This release may contain statements relating to the future results of the Company (including certain projections and business trends) that are considered “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 (the “PSLRA”).  Such forward-looking statements, in addition to historical information, involve risk and uncertainties, and are based on the beliefs, assumptions and expectations of management of the Company.  Words such as “expects,” “believes,” “should,” “plans,” “anticipates,” “will,” “potential,” “could,” “intend,” “may,” “outlook,” “predict,” “project,” “would,” “estimated,” “assumes,” “likely,” and variation of such similar expressions are intended to identify such forward-looking statements.  Examples of forward-looking statements include, but are not limited to, possible or assumed estimates with respect to the financial condition, expected or anticipated revenue, and results of operations and business of the Company, including earnings growth; revenue growth in retail banking lending and other areas; origination volume in the  consumer, commercial and other lending businesses; current and future capital management programs; non-interest income levels, including fees from the title abstract subsidiary and banking services as well as product sales; tangible capital generation; market share; expense levels; and other business operations and strategies.  The Company claims the protection of the safe harbor for forward-looking statements contained in the PSLRA.

Factors that could cause future results to vary from current management expectations include, but are not limited to, changing economic  conditions; legislative and regulatory changes, including increases in FDIC insurance rates; monetary and fiscal policies of the federal government; changes in tax policies; rates and regulations of federal, state and local tax authorities; changes in interest rates; deposit flows; the cost of funds; demands for loan products; demand for financial services; competition; changes in the quality and composition of BNB’s loan and investment portfolios; changes in management’s business strategies; changes in accounting principles, policies or guidelines; changes in real estate values; an unexpected increase in operating costs; expanded regulatory requirements as a result of the Dodd-Frank Act; and other risk factors discussed elsewhere, and in our reports filed with the Securities and Exchange Commission.   The forward-looking statements are made as of the date of this report, and the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.


BRIDGE BANCORP, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Condition (unaudited)
(In thousands)

          
  March 31,  December 31,  March 31, 
  2019 2018 2018
Assets         
Cash and due from banks $ 68,773  $ 142,145  $ 50,588 
Interest-earning deposits with banks   31,684    153,223    48,424 
Total cash and cash equivalents   100,457    295,368    99,012 
Securities available for sale, at fair value   707,451    680,886    726,056 
Securities held to maturity   149,512    160,163    176,089 
Total securities   856,963    841,049    902,145 
Securities, restricted   28,068    24,028    36,195 
Loans held for investment   3,391,104    3,275,811    3,201,897 
Allowance for loan losses   (31,784)   (31,418)   (32,812)
Loans held for investment, net   3,359,320    3,244,393    3,169,085 
Premises and equipment, net   34,478    35,008    33,892 
Operating lease right-of-use assets (1)   37,621    —    — 
Goodwill and other intangible assets   110,100    110,324    110,953 
Other real estate owned   175    175    175 
Accrued interest receivable and other assets   148,027    150,399    149,167 
Total assets $ 4,675,209  $ 4,700,744  $ 4,500,624 
          
Liabilities and stockholders' equity         
Demand deposits $ 1,258,544  $ 1,275,664  $ 1,164,501 
Savings and negotiable order of withdrawal ("NOW") deposits   513,971    496,881    433,757 
Money market deposit accounts ("MMDA")   993,920    975,531    803,267 
Certificates of deposit of less than $100,000   61,240    61,827    58,631 
Certificates of deposit of $100,000 or more   146,607    155,104    109,923 
Total individual, partnership and corporate ("IPC") deposits   2,974,282    2,965,007    2,570,079 
Brokered deposits   166,696    255,408    280,289 
Public funds - demand deposits   55,403    172,941    59,542 
Public funds - other deposits   529,083    493,037    521,335 
Total public and brokered deposits   751,182    921,386    861,166 
Total deposits   3,725,464    3,886,393    3,431,245 
Federal funds purchased and repurchase agreements   721    539    872 
Federal Home Loan Bank ("FHLB") advances   330,217    240,433    520,092 
Subordinated debentures, net   78,815    78,781    78,676 
Operating lease liabilities (1)   40,454    —    — 
Other liabilities and accrued expenses   34,535    40,768    36,416 
Total liabilities   4,210,206    4,246,914    4,067,301 
Total stockholders' equity   465,003    453,830    433,323 
Total liabilities and stockholders' equity $ 4,675,209  $ 4,700,744  $ 4,500,624 

_______________________________________________

(1) The Company adopted ASU 2016-02, Leases (Topic 842) using the transition approach at the beginning of the period of adoption on January 1, 2019 and did not restate comparative prior periods.


BRIDGE BANCORP, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income (unaudited)
(In thousands, except per share amounts)

           
  Three Months Ended  
  March 31,  December 31,  March 31,  
  2019 2018  2018 
Interest income $ 44,515 $ 43,480  $ 41,364 
Interest expense   10,192   9,382    6,825 
Net interest income   34,323   34,098    34,539 
Provision for loan losses   600   400    800 
Net interest income after provision for loan losses   33,723   33,698    33,739 
           
Non-interest income:          
Service charges and other fees   2,428   2,579    2,163 
Title fee income   306   458    505 
Gain on sale of SBA loans   217   492    371 
BOLI income   553   561    546 
Other operating income   1,714   1,025    528 
Total non-interest income   5,218   5,115    4,113 
           
Non-interest expense:          
Salaries and employee benefits   13,280   12,457    12,812 
Occupancy and equipment   3,531   3,472    3,243 
Net fraud recovery   —   (600)   — 
Office relocation costs   —   750    — 
Amortization of other intangible assets   213   214    246 
Other operating expenses   5,575   5,778    6,297 
Total non-interest expense   22,599   22,071    22,598 
           
Income before income taxes   16,342   16,742    15,254 
Income tax expense   3,415   2,878    3,181 
Net income $ 12,927 $ 13,864  $ 12,073 
Basic earnings per share $ 0.65 $ 0.70  $ 0.61 
Diluted earnings per share $ 0.65 $ 0.70  $ 0.61 
Weighted average common and equivalent shares   19,526   19,492    19,437 


BRIDGE BANCORP, INC. AND SUBSIDIARIES
Consolidated Financial Highlights (unaudited)
(In thousands, except per share amounts and financial ratios)

        
  Three Months Ended  
  March 31, December 31, March 31, 
  2019 2018 2018 
Selected Financial Data:       
Return on average total assets  1.13 1.22 1.09
Adjusted return on average total assets (1)  1.13  1.23  1.09 
Return on average stockholders' equity  11.41  12.32  10.86 
Adjusted return on average stockholders' equity (1)  11.41  12.43  10.86 
Return on average tangible common equity (1) (2)  15.01  16.38  14.41 
Adjusted return on average tangible common equity (1) (2)  15.21  16.72  14.65 
Net interest margin, tax-equivalent basis  3.29  3.26  3.42 
Adjusted net interest margin (1)  3.24  3.21  3.22 
Efficiency ratio  57.15  56.28  58.47 
Adjusted efficiency ratio (1)  56.43  55.16  57.58 
Operating expense/average assets  1.97  1.94  2.05 
Adjusted operating expense/average assets (1)  1.95  1.90  2.03 

______________________________________________

(1) See reconciliation of this non-GAAP financial measure provided elsewhere herein.
(2) Average tangible common equity represents a non-GAAP financial measure calculated as average total stockholders' equity less average goodwill and intangible assets.

           
  March 31,  December 31,  March 31,  
  2019 2018 2018 
Selected Financial Data:          
Book value per share $ 23.43 $ 22.93 $ 21.91 
Tangible book value per share (1) $ 17.88 $ 17.36 $ 16.30 
Common shares outstanding   19,848   19,791   19,780 
           
Capital Ratios:          
Total capital to risk-weighted assets   13.3  13.6  13.3%
Tier 1 capital to risk-weighted assets   10.2   10.4   10.0 
Common equity Tier 1 capital to risk-weighted assets   10.2   10.4   10.0 
Tier 1 capital to average assets   8.1   8.1   7.9 
Tangible common equity to tangible assets (1) (2)   7.8   7.5   7.3 
Tier 1 capital to average assets (Bank)   9.8   9.9   9.5 
           
Asset Quality:          
Loans 30-89 days past due $ 17,937 $ 4,400 $ 4,506 
Loans 90 days past due and accruing (3) $ 318 $ 308 $ 2,665 
Non-performing loans $ 3,071 $ 2,808 $ 6,071 
Other real estate owned   175   175   175 
Non-performing assets $ 3,246 $ 2,983 $ 6,246 
Non-performing loans/total loans   0.09  0.09  0.19%
Non-performing assets/total assets   0.07   0.06   0.14 
Allowance/non-performing loans  1034.97  1118.87  540.47 
Allowance/total loans   0.94   0.96   1.02 

______________________________________

(1) Tangible common equity represents a non-GAAP financial measure calculated as total stockholders' equity less goodwill and intangible assets.
(2) Tangible assets represent a non-GAAP financial measure calculated as total assets less goodwill and intangible assets.
(3) Represents loans acquired in connection with the Community National Bank and FNBNY Bancorp, Inc. acquisitions.


BRIDGE BANCORP, INC. AND SUBSIDIARIES
Supplemental Financial Information
Condensed Consolidated Average Balance Sheets and Average Rate Data (unaudited)
(Dollars in thousands)

                          
  Three Months Ended March 31,  Three Months Ended December 31, Three Months Ended March 31, 
  2019 2018 2018 
      Average     Average     Average 
  Average   Yield/ Average   Yield/ Average   Yield/ 
  Balance Interest Cost Balance Interest Cost Balance Interest Cost 
Interest-earning assets:                         
Loans, net (including loan fee income) (1) $ 3,275,828 $ 37,659   4.66 $3,206,033 $36,848  4.56% $3,127,900 $35,660  4.62% 
Securities (1)   885,834   6,442   2.95   882,886  6,328  2.84   969,292  5,780  2.42  
Deposits with banks   91,682   544   2.41   74,348  443  2.36   23,108  90  1.58  
Total interest-earning assets (1)   4,253,344   44,645   4.26   4,163,267  43,619  4.16   4,120,300  41,530  4.09  
Non-interest-earning assets:                         
Other assets   392,283       359,740       354,893      
Total assets $ 4,645,627      $4,523,007      $4,475,193      
                          
Interest-bearing liabilities:                         
Savings $ 398,499 $ 905   0.92 $375,792 $656  0.69% $291,488 $78  0.11% 
NOW   105,996   41   0.16   113,116  40  0.14   136,288  26  0.08  
MMDA   983,942   3,586   1.48   906,565  2,950  1.29   770,073  1,401  0.74  
Savings, NOW and MMDA   1,488,437   4,532   1.23   1,395,473  3,646  1.04   1,197,849  1,505  0.51  
Certificates of deposit of less than $100,000   61,317   261   1.73   61,803  250  1.60   58,792  161  1.11  
Certificates of deposit of $100,000 or more   150,102   732   1.98   156,806  739  1.87   109,094  332  1.23  
Total IPC deposits   1,699,856   5,525   1.32   1,614,082  4,635  1.14   1,365,735  1,998  0.59  
Brokered deposits   209,409   1,210   2.34   263,580  1,528  2.30   201,872  785  1.58  
Public funds   534,568   1,179   0.89   433,845  787  0.72   497,438  443  0.36  
Total public and brokered deposits   743,977   2,389   1.30   697,425  2,315  1.32   699,310  1,228  0.71  
Total deposits   2,443,833   7,914   1.31   2,311,507  6,950  1.19   2,065,045  3,226  0.63  
Federal funds purchased and repurchase agreements   7,691   45   2.37   3,180  15  1.87   151,647  606  1.62  
FHLB advances   243,290   1,098   1.83   265,235  1,282  1.92   428,247  1,858  1.76  
Subordinated debentures   78,793   1,135   5.84   78,758  1,135  5.72   78,653  1,135  5.85  
Total borrowings   329,774   2,278   2.80   347,173  2,432  2.78   658,547  3,599  2.22  
Total interest-bearing liabilities   2,773,607   10,192   1.49   2,658,680  9,382  1.40   2,723,592  6,825  1.02  
Non-interest-bearing liabilities:                         
Demand deposits   1,333,498       1,370,428       1,262,989      
Other liabilities   79,083       47,547       37,838      
Total liabilities   4,186,188       4,076,655       4,024,419      
Stockholders' equity   459,439       446,352       450,774      
Total liabilities and stockholders' equity $ 4,645,627      $4,523,007      $4,475,193      
                          
Net interest rate spread        2.77       2.76%       3.07% 
Net interest-earning assets $ 1,479,737      $1,504,587      $1,396,708      
Net interest margin - tax-equivalent      34,453   3.29     34,237  3.26%     34,705  3.42% 
Less: Tax-equivalent adjustment      (130)  (0.02)     (139) (0.01)     (166) (0.02) 
Net interest income    $ 34,323       $34,098       $34,539    
Net interest margin        3.27       3.25%       3.40% 
                          

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(1) Presented on a tax-equivalent basis.



BRIDGE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Measures (unaudited)
Reconciliation of as reported (GAAP) and non-GAAP financial measures

The following tables below provide a reconciliation of certain financial measures calculated under generally accepted accounting principles ("GAAP") (as reported) and non-GAAP. A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with GAAP in the United States. The Company’s management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with GAAP. While management uses these non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with GAAP or considered to be more important than financial results determined in accordance with GAAP.

The following non-GAAP financial measures exclude a net fraud recovery and office relocation costs during the fourth quarter of 2018.

        
  Three Months Ended  
  March 31,  December 31,  March 31,  
  2019 2018 2018 
Return on average total assets - as reported  1.13  1.22  1.09 
Net fraud recovery  —   (0.05)  —  
Office relocation costs  —   0.07   —  
Income tax effect of adjustments above  —   (0.01)  —  
Adjusted return on average total assets (non-GAAP)  1.13   1.23   1.09  
        
Return on average stockholders' equity - as reported  11.41  12.32  10.86 
Net fraud recovery  —   (0.53)  —  
Office relocation costs  —   0.67   —  
Income tax effect of adjustments above  —   (0.03)  —  
Adjusted return on average stockholders' equity (non-GAAP)  11.41   12.43   10.86  
        
Return on average tangible common equity - as reported  15.01  16.38  14.41 
Net fraud recovery  —   (0.71)  —  
Office relocation costs  —   0.89   —  
Amortization of other intangible assets  0.25   0.25   0.29  
Income tax effect of adjustments above  (0.05)  (0.09)  (0.05) 
Adjusted return on average tangible common equity (non-GAAP)  15.21   16.72   14.65  


BRIDGE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Measures (unaudited)

The following table presents a reconciliation of net income and diluted earnings per share (as reported) to adjusted net income and adjusted diluted earnings per share excluding a net fraud recovery and office relocation costs:

           
  Three Months Ended  
  March 31,  December 31,  March 31,  
(Dollars in thousands, except per share amounts) 2019 2018 2018 
Net income - as reported $ 12,927 $ 13,864  $ 12,073 
Adjustments:          
Net fraud recovery   —   (600)   — 
Office relocation costs   —   750    — 
Income tax effect of adjustments above   —   (32)   — 
Adjusted net income (non-GAAP) $ 12,927 $ 13,982  $ 12,073 
           
Diluted earnings per share - as reported $ 0.65 $ 0.70  $ 0.61 
Adjustments:          
Net fraud recovery   —   (0.03)   — 
Office relocation costs   —   0.04    — 
Income tax effect of adjustments above   —   (0.01)   — 
Adjusted diluted earnings per share (non-GAAP) $ 0.65 $ 0.70  $ 0.61 


The following table presents a reconciliation of efficiency ratio (as reported) and adjusted efficiency ratio (non-GAAP):

           
  Three Months Ended  
  March 31,  December 31,  March 31,  
(Dollars in thousands, except per share amounts) 2019 2018 2018 
Efficiency ratio - as reported   57.15   56.28   58.47 
Non-interest expense - as reported $ 22,599  $ 22,071  $ 22,598  
Less: Net fraud recovery   —    600    —  
Less: Office relocation costs   —    (750)   —  
Less: Amortization of intangible assets   (213)   (214)   (246) 
Adjusted non-interest expense (non-GAAP) $ 22,386  $ 21,707  $ 22,352  
Net interest income - as reported $ 34,323  $ 34,098  $ 34,539  
Tax-equivalent adjustment   130    139    166  
Net interest income, tax-equivalent basis $ 34,453  $ 34,237  $ 34,705  
Non-interest income - as reported $ 5,218  $ 5,115  $ 4,113  
Less: Net securities losses/(gains)   —    —    —  
Adjusted non-interest income (non-GAAP) $ 5,218  $ 5,115  $ 4,113  
Adjusted total revenues for adjusted efficiency ratio (non-GAAP) $ 39,671  $ 39,352  $ 38,818  
Adjusted efficiency ratio (non-GAAP) (1)   56.43   55.16   57.58 

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(1) Adjusted efficiency ratio is calculated by dividing adjusted non-interest expense by the sum of net interest income on a tax-equivalent basis and adjusted non-interest income.


BRIDGE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Measures (unaudited)

The following table presents a reconciliation of operating expense as a percentage of average assets (as reported) and adjusted operating expense as a percentage of average assets (non-GAAP):

        
  Three Months Ended  
  March 31,  December 31,  March 31,  
  2019 2018 2018 
Operating expense as a % of average assets - as reported  1.97%  1.94%  2.05% 
Net fraud recovery  —   0.05   —  
Office relocation costs  —   (0.07)  —  
Amortization of other intangible assets  (0.02)  (0.02)  (0.02) 
Adjusted operating expense as a % of average assets (non-GAAP)  1.95   1.90   2.03  

_______________________________________

The following table reconciles net interest margin (as reported) to adjusted net interest margin on a tax-equivalent basis, excluding accretion income and average purchase accounting adjustments on acquired loans (non-GAAP):

           
  Three Months Ended  
  March 31,  December 31,  March 31,  
(Dollars in thousands) 2019 2018 2018 
Net interest income - as reported $ 34,323  $ 34,098  $ 34,539  
Tax-equivalent adjustment   130    139    166  
Net interest income, tax-equivalent basis $ 34,453  $ 34,237  $ 34,705  
Adjustment:          
Less: Accretion income on acquired loans   (385)   (463)   (1,959) 
Adjusted net interest income, tax-equivalent basis (non-GAAP) $ 34,068  $ 33,774  $ 32,746  
           
Average interest-earning assets - as reported $ 4,253,344  $ 4,163,267  $ 4,120,300  
Adjustment:          
Average purchase accounting adjustments on acquired loans   4,941    5,379    9,131  
Adjusted average interest-earning assets (non-GAAP) $ 4,258,285  $ 4,168,646  $ 4,129,431  
           
Average yield on loans, tax-equivalent basis - as reported   4.66   4.56   4.62 
Adjustment:          
Purchase accounting adjustments on acquired loans   (0.05)   (0.06)   (0.26) 
Adjusted average yield on loans (non-GAAP)   4.61    4.50    4.36  
           
Net interest margin - as reported (1)   3.27   3.25   3.40 
Tax-equivalent adjustment   0.02    0.01    0.02  
Net interest margin, tax-equivalent basis (2)   3.29    3.26    3.42  
Adjustment:          
Purchase accounting adjustments on acquired loans   (0.05)   (0.05)   (0.20) 
Adjusted net interest margin (non-GAAP) (3)   3.24    3.21    3.22  

________________________________

(1) Net interest margin represents net interest income divided by average interest-earning assets.
(2) Net interest margin, tax-equivalent basis represents net interest income on a tax-equivalent basis divided by average interest-earning assets.
(3) Adjusted net interest margin represents adjusted net interest income on a tax-equivalent basis divided by adjusted average interest-earning assets.


BRIDGE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Measures (unaudited)

The following table presents the tangible common equity to tangible assets calculation (non-GAAP):

           
  March 31,  December 31,  March 31,  
(Dollars in thousands) 2019 2018 2018 
Total assets - as reported $ 4,675,209  $ 4,700,744  $ 4,500,624  
Less: Goodwill and other intangible assets - as reported   (110,100)   (110,324)   (110,953) 
Tangible assets (non-GAAP) $ 4,565,109  $ 4,590,420  $ 4,389,671  
           
Total stockholders' equity - as reported $ 465,003  $ 453,830  $ 433,323  
Less: Goodwill and other intangible assets - as reported   (110,100)   (110,324)   (110,953) 
Tangible common equity (non-GAAP) $ 354,903  $ 343,506  $ 322,370  
           
Tangible common equity to tangible assets (non-GAAP) (1)   7.8%   7.5%   7.3% 

______________________________

(1) Calculated by dividing tangible common equity by tangible assets.


Contact:John M. McCaffery
 Executive Vice President
 Chief Financial Officer
 (631) 537-1001, ext. 7290

 

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