NEW CANAAN, Conn.--(BUSINESS WIRE)--Bankwell Financial Group, Inc. (NASDAQ: BWFG) reported record GAAP net income of $8.2 million, or $1.04 per share, for the first quarter of 2022, versus $5.7 million, or $0.71 per share, for the same period in 2021.
The Company's Board of Directors declared a $0.20 per share cash dividend, payable May 23, 2022 to shareholders of record on May 13, 2022.
We recommend reading this earnings release in conjunction with the First Quarter 2022 Investor Presentation, located at http://investor.mybankwell.com/Presentations and included as an exhibit to our April 27, 2022 Current Report on Form 8-K.
Notes Bankwell Financial Group President and CEO, Christopher R. Gruseke:
"Our team has begun the year with continued high performance. Loan balances grew by almost 5% compared to year end 2021 and our financial results for the quarter were exceptionally strong. The Company achieved record ROAA and ROAE levels of 1.35% and 16.05%, respectively, while operating at an efficiency ratio of 48.5%.
"On the operational front, we have just completed a successful conversion of our core data processing system. This is the second major system conversion the team has successfully executed within the past twelve months as we invested in a new online banking platform during the 2nd half of 2021. We have also begun a systematic review of every operational process at the Bank. This process mapping project will help to identify opportunities to employ further technological solutions and increase efficiencies through the organization.
"Credit quality remains high and our loan pipeline is as vibrant as it has been for the last several quarters. We reaffirm prior guidance of year over year net interest income growth of 12%-14% for 2022.
"Most importantly, I’d like to congratulate and thank my Bankwell colleagues whose hard work and dedication have made the Company’s accomplishments possible."
First Quarter 2022 Highlights:
- Return on average assets was 1.35% and return on average equity was 16.05% for the quarter ended March 31, 2022.
- The net interest margin was 3.30% for the quarter ended March 31, 2022.
- The efficiency ratio was 48.5% for the quarter ended March 31, 2022.
- Total gross loans were $2.0 billion, growing $90.4 million, or 4.8%, compared to December 31, 2021.
- Gains from loan sales totaled $0.6 million for the quarter ended March 31, 2022.
- Total deposits were $2.2 billion compared to $2.1 billion at December 31, 2021.
- Noninterest bearing deposits increased by $14.0 million, or 3.5% compared to December 31, 2021.
- The percentage of noninterest bearing deposits to total deposits increased to 19.1% compared to 18.8% at December 31, 2021.
- Investment securities totaled $116.8 million and represent 4.7% of total assets.
- Fully diluted tangible book value per share rose to $26.75 compared to $25.55 at December 31, 2021.
- Shares issued and outstanding were 7,761,338, reflecting repurchases of 112,829 shares of common stock at a weighted average price of $34.01 during the quarter ended March 31, 2022.
Earnings and Performance
Revenues (net interest income plus noninterest income) for the quarter ended March 31, 2022 were $20.5 million, versus $16.6 million for the quarter ended March 31, 2021. The increase was primarily attributable to an increase in interest and fees on loans due to loan growth and higher overall loan yields and from lower interest expense on deposits. The increase in revenues was partially offset by a decrease in noninterest income driven by a one-time federal payroll tax credit for COVID-19 of $0.9 million recognized in the quarter ended March 31, 2021.
Net income for the quarter ended March 31, 2022 was $8.2 million, versus $5.7 million for the quarter ended March 31, 2021. The increase in net income was primarily impacted by the aforementioned increases in revenues, partially offset by an increase in the provision for loan losses driven by loan growth and a slight increase in noninterest expense.
Basic and diluted earnings per share were $1.05 and $1.04, respectively, for the quarter ended March 31, 2022 compared to basic and diluted earnings per share of $0.72 and $0.71, respectively, for the quarter ended March 31, 2021.
The net interest margin (fully taxable equivalent basis) for the quarters ended March 31, 2022 and March 31, 2021 was 3.30% and 2.74%, respectively. The increase in the net interest margin was due to lower interest expense from a decrease in rates on interest bearing deposits, a greater proportion of noninterest bearing deposits and, to a lesser extent, an increase in overall loan yields.
Financial Condition
Assets totaled $2.50 billion at March 31, 2022, compared to assets of $2.46 billion at December 31, 2021. The increase in assets was primarily due to loan growth, partially offset by a decrease in excess liquidity. Gross loans totaled $2.0 billion at March 31, 2022, an increase of $90.4 million compared to December 31, 2021. Deposits totaled $2.2 billion at March 31, 2022, compared to deposits of $2.1 billion at December 31, 2021.
Capital
Shareholders’ equity totaled $210.2 million as of March 31, 2022, an increase of $8.2 million compared to December 31, 2021, primarily a result of (i) net income of $8.2 million for the quarter ended March 31, 2022 and (ii) a $4.9 million favorable impact to accumulated other comprehensive income driven by fair value marks related to hedge positions involving interest rate swaps. The Company's interest rate swaps are used to hedge interest rate risk. The Company's current interest rate swap positions will cause a decrease to other comprehensive income in a falling interest rate environment and an increase in a rising interest rate environment. The increase in Shareholders’ equity was partially offset by dividends paid of $1.6 million and common stock repurchases of $3.8 million.
About Bankwell Financial Group
Bankwell is a commercial bank that serves the banking needs of residents and businesses throughout Fairfield and New Haven Counties, Connecticut. For more information about this press release, interested parties may contact Christopher R. Gruseke, President and Chief Executive Officer or Penko Ivanov, Executive Vice President and Chief Financial Officer of Bankwell Financial Group at (203) 652-0166.
For more information, visit www.mybankwell.com.
This press release may contain certain forward-looking statements about the Company. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include, but are not limited to, increased competitive pressures, changes in the interest rate environment, general economic conditions or conditions within the securities markets, uncertain impacts of, or additional changes in, monetary, fiscal or tax policy to address the impact of COVID-19, which could further exacerbate the effects on the Company’s business and results of operations, and legislative and regulatory changes that could adversely affect the business in which the Company and its subsidiaries are engaged.
Non-GAAP Financial Measures
In addition to evaluating the Company's financial performance in accordance with U.S. generally accepted accounting principles ("GAAP"), management may evaluate certain non-GAAP financial measures, such as the efficiency ratio. A computation and reconciliation of certain non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of GAAP to Non-GAAP Measures tables. We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. For example, the Company believes that the efficiency ratio is useful in the assessment of financial performance, including noninterest expense control. The Company believes that tangible common equity, tangible book value per share, and return on average tangible common equity are useful to evaluate the relative strength of the Company's performance and capital position. We utilize these measures for internal planning and forecasting purposes. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure.
BANKWELL FINANCIAL GROUP, INC. CONSOLIDATED BALANCE SHEETS (unaudited) (Dollars in thousands) |
|||||||||||
|
March 31,
|
|
December 31,
|
|
March 31,
|
||||||
ASSETS |
|
|
|
|
|
||||||
Cash and due from banks |
$ |
280,471 |
|
|
$ |
291,598 |
|
|
$ |
351,194 |
|
Federal funds sold |
|
19,022 |
|
|
|
53,084 |
|
|
|
10,811 |
|
Cash and cash equivalents |
|
299,493 |
|
|
|
344,682 |
|
|
|
362,005 |
|
|
|
|
|
|
|
||||||
Investment securities |
|
|
|
|
|
||||||
Marketable equity securities, at fair value |
|
2,090 |
|
|
|
2,168 |
|
|
|
2,178 |
|
Available for sale investment securities, at fair value |
|
98,733 |
|
|
|
90,198 |
|
|
|
83,218 |
|
Held to maturity investment securities, at amortized cost |
|
15,979 |
|
|
|
16,043 |
|
|
|
16,225 |
|
Total investment securities |
|
116,802 |
|
|
|
108,409 |
|
|
|
101,621 |
|
Loans receivable (net of allowance for loan losses of $17,141, $16,902 and $20,545 at March 31, 2022, December 31, 2021 and March 31, 2021, respectively) |
|
1,964,567 |
|
|
|
1,875,167 |
|
|
|
1,650,127 |
|
Accrued interest receivable |
|
7,733 |
|
|
|
7,512 |
|
|
|
7,306 |
|
Federal Home Loan Bank stock, at cost |
|
2,870 |
|
|
|
2,814 |
|
|
|
6,446 |
|
Premises and equipment, net |
|
25,661 |
|
|
|
25,588 |
|
|
|
33,386 |
|
Bank-owned life insurance |
|
49,434 |
|
|
|
49,174 |
|
|
|
42,881 |
|
Goodwill |
|
2,589 |
|
|
|
2,589 |
|
|
|
2,589 |
|
Other intangible assets |
|
— |
|
|
|
— |
|
|
|
67 |
|
Deferred income taxes, net |
|
6,879 |
|
|
|
7,621 |
|
|
|
8,908 |
|
Other assets |
|
20,849 |
|
|
|
32,708 |
|
|
|
29,131 |
|
Total assets |
$ |
2,496,877 |
|
|
$ |
2,456,264 |
|
|
$ |
2,244,467 |
|
|
|
|
|
|
|
||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
||||||
Liabilities |
|
|
|
|
|
||||||
Deposits |
|
|
|
|
|
||||||
Noninterest bearing deposits |
$ |
412,985 |
|
|
$ |
398,956 |
|
|
$ |
280,947 |
|
Interest bearing deposits |
|
1,753,219 |
|
|
|
1,725,042 |
|
|
|
1,578,861 |
|
Total deposits |
|
2,166,204 |
|
|
|
2,123,998 |
|
|
|
1,859,808 |
|
|
|
|
|
|
|
||||||
Advances from the Federal Home Loan Bank |
|
50,000 |
|
|
|
50,000 |
|
|
|
125,000 |
|
Subordinated debentures |
|
34,471 |
|
|
|
34,441 |
|
|
|
25,271 |
|
Accrued expenses and other liabilities |
|
35,982 |
|
|
|
45,838 |
|
|
|
46,445 |
|
Total liabilities |
|
2,286,657 |
|
|
|
2,254,277 |
|
|
|
2,056,524 |
|
|
|
|
|
|
|
||||||
Shareholders’ equity |
|
|
|
|
|
||||||
Common stock, no par value |
|
114,882 |
|
|
|
118,148 |
|
|
|
120,398 |
|
Retained earnings |
|
99,047 |
|
|
|
92,400 |
|
|
|
75,418 |
|
Accumulated other comprehensive loss |
|
(3,709 |
) |
|
|
(8,561 |
) |
|
|
(7,873 |
) |
Total shareholders’ equity |
|
210,220 |
|
|
|
201,987 |
|
|
|
187,943 |
|
|
|
|
|
|
|
||||||
Total liabilities and shareholders’ equity |
$ |
2,496,877 |
|
|
$ |
2,456,264 |
|
|
$ |
2,244,467 |
|
BANKWELL FINANCIAL GROUP, INC. CONSOLIDATED STATEMENTS OF INCOME (unaudited) (Dollars in thousands, except share data) |
|||||||||||
|
For the Quarter Ended |
||||||||||
|
March 31,
|
|
December 31,
|
|
March 31,
|
||||||
Interest and dividend income |
|
|
|
|
|
||||||
Interest and fees on loans |
$ |
21,428 |
|
|
$ |
21,081 |
|
|
$ |
17,900 |
|
Interest and dividends on securities |
|
720 |
|
|
|
722 |
|
|
|
769 |
|
Interest on cash and cash equivalents |
|
154 |
|
|
|
90 |
|
|
|
108 |
|
Total interest and dividend income |
|
22,302 |
|
|
|
21,893 |
|
|
|
18,777 |
|
|
|
|
|
|
|
||||||
Interest expense |
|
|
|
|
|
||||||
Interest expense on deposits |
|
2,206 |
|
|
|
2,198 |
|
|
|
3,114 |
|
Interest expense on borrowings |
|
586 |
|
|
|
767 |
|
|
|
1,008 |
|
Total interest expense |
|
2,792 |
|
|
|
2,965 |
|
|
|
4,122 |
|
|
|
|
|
|
|
||||||
Net interest income |
|
19,510 |
|
|
|
18,928 |
|
|
|
14,655 |
|
Provision (credit) for loan losses |
|
229 |
|
|
|
125 |
|
|
|
(296 |
) |
Net interest income after provision (credit) for loan losses |
|
19,281 |
|
|
|
18,803 |
|
|
|
14,951 |
|
|
|
|
|
|
|
||||||
Noninterest income |
|
|
|
|
|
||||||
Gains and fees from sales of loans |
|
631 |
|
|
|
441 |
|
|
|
513 |
|
Bank owned life insurance |
|
260 |
|
|
|
270 |
|
|
|
231 |
|
Service charges and fees |
|
240 |
|
|
|
257 |
|
|
|
199 |
|
Other |
|
(173 |
) |
|
|
(143 |
) |
|
|
1,013 |
|
Total noninterest income |
|
958 |
|
|
|
825 |
|
|
|
1,956 |
|
|
|
|
|
|
|
||||||
Noninterest expense |
|
|
|
|
|
||||||
Salaries and employee benefits |
|
4,940 |
|
|
|
4,806 |
|
|
|
4,769 |
|
Occupancy and equipment |
|
2,150 |
|
|
|
2,411 |
|
|
|
2,406 |
|
Professional services |
|
981 |
|
|
|
628 |
|
|
|
587 |
|
Data processing |
|
654 |
|
|
|
432 |
|
|
|
512 |
|
Director fees |
|
352 |
|
|
|
335 |
|
|
|
317 |
|
FDIC insurance |
|
223 |
|
|
|
231 |
|
|
|
403 |
|
Marketing |
|
45 |
|
|
|
87 |
|
|
|
(9 |
) |
Other |
|
580 |
|
|
|
749 |
|
|
|
653 |
|
Total noninterest expense |
|
9,925 |
|
|
|
9,679 |
|
|
|
9,638 |
|
|
|
|
|
|
|
||||||
Income before income tax expense |
|
10,314 |
|
|
|
9,949 |
|
|
|
7,269 |
|
Income tax expense |
|
2,102 |
|
|
|
2,135 |
|
|
|
1,579 |
|
Net income |
$ |
8,212 |
|
|
$ |
7,814 |
|
|
$ |
5,690 |
|
|
|
|
|
|
|
||||||
Earnings Per Common Share: |
|
|
|
|
|
||||||
Basic |
$ |
1.05 |
|
|
$ |
1.00 |
|
|
$ |
0.72 |
|
Diluted |
$ |
1.04 |
|
|
$ |
0.99 |
|
|
$ |
0.71 |
|
|
|
|
|
|
|
||||||
Weighted Average Common Shares Outstanding: |
|
|
|
|
|
||||||
Basic |
|
7,637,077 |
|
|
|
7,660,307 |
|
|
|
7,758,540 |
|
Diluted |
|
7,719,405 |
|
|
|
7,726,420 |
|
|
|
7,800,777 |
|
Dividends per common share |
$ |
0.20 |
|
|
$ |
0.18 |
|
|
$ |
0.14 |
|
BANKWELL FINANCIAL GROUP, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited) |
|||||
|
For the Quarter Ended |
||||
|
March 31, 2022 |
|
December 31, 2021 |
|
March 31,
|
Performance ratios: |
|
|
|
|
|
Return on average assets |
1.35 % |
|
1.32 % |
|
1.02 % |
Return on average stockholders' equity |
16.05 % |
|
15.44 % |
|
12.67 % |
Return on average tangible common equity |
16.25 % |
|
15.65 % |
|
12.86 % |
Net interest margin |
3.30 % |
|
3.43 % |
|
2.74 % |
Efficiency ratio(1) |
48.5 % |
|
48.8 % |
|
58.0 % |
Net loan charge-offs as a % of average loans |
— % |
|
— % |
|
0.01 % |
Dividend payout ratio(2) |
19.23 % |
|
18.18 % |
|
19.72 % |
(1) Efficiency ratio is defined as noninterest expense, less other real estate owned expenses and amortization of intangible assets, divided by our operating revenue, which is equal to net interest income plus noninterest income excluding gains and losses on sales of securities and gains and losses on other real estate owned. In our judgment, the adjustments made to operating revenue allow investors and analysts to better assess our operating expenses in relation to our core operating revenue by removing the volatility that is associated with certain one-time items and other discrete items that are unrelated to our core business. |
(2) The dividend payout ratio is calculated by dividing dividends per share by earnings per share. |
|
As of |
||||
|
March 31, 2022 |
|
December 31, 2021 |
|
March 31, 2021 |
Capital ratios: |
|
|
|
|
|
Total Common Equity Tier 1 Capital to Risk-Weighted Assets(1) |
11.20 % |
|
11.18 % |
|
11.02 % |
Total Capital to Risk-Weighted Assets(1) |
12.00 % |
|
12.00 % |
|
12.17 % |
Tier I Capital to Risk-Weighted Assets(1) |
11.20 % |
|
11.18 % |
|
11.02 % |
Tier I Capital to Average Assets(1) |
9.80 % |
|
9.94 % |
|
8.82 % |
Tangible common equity to tangible assets |
8.32 % |
|
8.13 % |
|
8.27 % |
Fully diluted tangible book value per common share |
$ 26.75 |
|
$ 25.55 |
|
$ 23.43 |
(1) Represents Bank ratios. Current period capital ratios are preliminary subject to finalization of the FDIC Call Report. |
BANKWELL FINANCIAL GROUP, INC. ASSET QUALITY (unaudited) (Dollars in thousands) |
|||||||||||
|
For the Quarter Ended |
||||||||||
|
March 31, 2022 |
|
December 31, 2021 |
|
March 31, 2021 |
||||||
Allowance for loan losses: |
|
|
|
|
|
||||||
Balance at beginning of period |
$ |
16,902 |
|
|
$ |
16,803 |
|
|
$ |
21,009 |
|
Charge-offs: |
|
|
|
|
|
||||||
Commercial real estate |
|
— |
|
|
|
— |
|
|
|
(163 |
) |
Commercial business |
|
— |
|
|
|
(26 |
) |
|
|
— |
|
Consumer |
|
(4 |
) |
|
|
(5 |
) |
|
|
(14 |
) |
Total charge-offs |
|
(4 |
) |
|
|
(31 |
) |
|
|
(177 |
) |
Recoveries: |
|
|
|
|
|
||||||
Commercial business |
|
13 |
|
|
|
2 |
|
|
|
— |
|
Consumer |
|
1 |
|
|
|
3 |
|
|
|
9 |
|
Total recoveries |
|
14 |
|
|
|
5 |
|
|
|
9 |
|
Net loan recoveries (charge-offs) |
|
10 |
|
|
|
(26 |
) |
|
|
(168 |
) |
Provision (credit) for loan losses |
|
229 |
|
|
|
125 |
|
|
|
(296 |
) |
Balance at end of period |
$ |
17,141 |
|
|
$ |
16,902 |
|
|
$ |
20,545 |
|
|
As of |
||||||||||
|
March 31, 2022 |
|
December 31, 2021 |
|
March 31, 2021 |
||||||
Asset quality: |
|
|
|
|
|
||||||
Nonaccrual loans |
|
|
|
|
|
||||||
Residential real estate |
$ |
2,181 |
|
|
$ |
2,380 |
|
|
$ |
1,289 |
|
Commercial real estate |
|
3,365 |
|
|
|
3,482 |
|
|
|
19,277 |
|
Commercial business |
|
817 |
|
|
|
1,728 |
|
|
|
1,803 |
|
Construction |
|
9,382 |
|
|
|
8,997 |
|
|
|
8,997 |
|
Total nonaccrual loans |
|
15,745 |
|
|
|
16,587 |
|
|
|
31,366 |
|
Other real estate owned |
|
— |
|
|
|
— |
|
|
|
— |
|
Total nonperforming assets |
$ |
15,745 |
|
|
$ |
16,587 |
|
|
$ |
31,366 |
|
|
|
|
|
|
|
||||||
Nonperforming loans as a % of total loans |
|
0.79 |
% |
|
|
0.88 |
% |
|
|
1.87 |
% |
Nonperforming assets as a % of total assets |
|
0.63 |
% |
|
|
0.68 |
% |
|
|
1.40 |
% |
Allowance for loan losses as a % of total loans |
|
0.86 |
% |
|
|
0.89 |
% |
|
|
1.23 |
% |
Allowance for loan losses as a % of nonperforming loans |
|
108.87 |
% |
|
|
101.90 |
% |
|
|
65.50 |
% |
Total nonaccrual loans declined $0.8 million to $15.7 million as of March 31, 2022 when compared to December 31, 2021. Nonperforming assets as a percentage of total assets was 0.63% at March 31, 2022, down from 0.68% at December 31, 2021. The allowance for loan losses at March 31, 2022 was $17.1 million, representing 0.86% of total loans.
BANKWELL FINANCIAL GROUP, INC. LOAN & DEPOSIT PORTFOLIO (unaudited) (Dollars in thousands) |
||||||||
Period End Loan Composition |
March 31, 2022 |
|
December 31, 2021 |
|
% Change |
|||
Residential Real Estate |
$ |
68,617 |
|
$ |
79,987 |
|
(14.2 |
) % |
Commercial Real Estate(1) |
|
1,425,758 |
|
|
1,356,709 |
|
5.1 |
|
Construction |
|
115,514 |
|
|
98,341 |
|
17.5 |
|
Total Real Estate Loans |
|
1,609,889 |
|
|
1,535,037 |
|
4.9 |
|
|
|
|
|
|
|
|||
Commercial Business |
|
370,166 |
|
|
350,975 |
|
5.5 |
|
|
|
|
|
|
|
|||
Consumer |
|
5,275 |
|
|
8,869 |
|
(40.5 |
) |
Total Loans |
$ |
1,985,330 |
|
$ |
1,894,881 |
|
4.8 |
% |
|
|
|
|
|
|
|||
(1) Includes owner occupied commercial real estate. |
||||||||
Gross loans totaled $2.0 billion at March 31, 2022, an increase of $90.4 million compared to December 31, 2021.
Period End Deposit Composition |
March 31, 2022 |
|
December 31, 2021 |
|
% Change |
|||
Noninterest bearing demand |
$ |
412,985 |
|
$ |
398,956 |
|
3.5 |
% |
NOW |
|
112,567 |
|
|
119,479 |
|
(5.8 |
) |
Money Market |
|
996,458 |
|
|
954,674 |
|
4.4 |
|
Savings |
|
197,961 |
|
|
193,631 |
|
2.2 |
|
Time |
|
446,233 |
|
|
457,258 |
|
(2.4 |
) |
Total Deposits |
$ |
2,166,204 |
|
$ |
2,123,998 |
|
2.0 |
% |
Total deposits were $2.2 billion at March 31, 2022, compared to $2.1 billion at December 31, 2021, an increase of $42.2 million, or 2.0%.
BANKWELL FINANCIAL GROUP, INC. NONINTEREST INCOME AND EXPENSE (unaudited) (Dollars in thousands) |
||||||||||||||||
|
For the Quarter Ended |
|
|
|
|
|||||||||||
Noninterest income |
March 31, 2022 |
|
December 31, 2021 |
|
March 31, 2021 |
|
Mar 22 vs. Dec 21 % Change |
|
Mar 22 vs. Mar 21 % Change |
|||||||
Gains and fees from sales of loans |
$ |
631 |
|
|
$ |
441 |
|
|
$ |
513 |
|
43.1 |
% |
|
23.0 |
% |
Bank owned life insurance |
|
260 |
|
|
|
270 |
|
|
|
231 |
|
(3.7 |
) |
|
12.6 |
|
Service charges and fees |
|
240 |
|
|
|
257 |
|
|
|
199 |
|
(6.6 |
) |
|
20.6 |
|
Other |
|
(173 |
) |
|
|
(143 |
) |
|
|
1,013 |
|
21.0 |
|
|
(117.1 |
) |
Total noninterest income |
$ |
958 |
|
|
$ |
825 |
|
|
$ |
1,956 |
|
16.1 |
% |
|
(51.0 |
) % |
Noninterest income decreased by $1.0 million to $1.0 million for the quarter ended March 31, 2022 compared to the quarter ended March 31, 2021. The decrease in noninterest income was driven by a one-time federal payroll tax credit for COVID-19 of $0.9 million recognized in the quarter ended March 31, 2021.
|
For the Quarter Ended |
|
|
|
|
||||||||||
Noninterest expense |
March 31, 2022 |
|
December 31, 2021 |
|
March 31, 2021 |
|
Mar 22 vs. Dec 21 % Change |
|
Mar 22 vs. Mar 21 % Change |
||||||
Salaries and employee benefits |
$ |
4,940 |
|
$ |
4,806 |
|
$ |
4,769 |
|
|
2.8 |
% |
|
3.6 |
% |
Occupancy and equipment |
|
2,150 |
|
|
2,411 |
|
|
2,406 |
|
|
(10.8 |
) |
|
(10.6 |
) |
Professional services |
|
981 |
|
|
628 |
|
|
587 |
|
|
56.2 |
|
|
67.1 |
|
Data processing |
|
654 |
|
|
432 |
|
|
512 |
|
|
51.4 |
|
|
27.7 |
|
Director fees |
|
352 |
|
|
335 |
|
|
317 |
|
|
5.1 |
|
|
11.0 |
|
FDIC insurance |
|
223 |
|
|
231 |
|
|
403 |
|
|
(3.5 |
) |
|
(44.7 |
) |
Marketing |
|
45 |
|
|
87 |
|
|
(9 |
) |
|
(48.3 |
) |
|
N/M(1) |
|
Other |
|
580 |
|
|
749 |
|
|
653 |
|
|
(22.6 |
) |
|
(11.2 |
) |
Total noninterest expense |
$ |
9,925 |
|
$ |
9,679 |
|
$ |
9,638 |
|
|
2.5 |
% |
|
3.0 |
% |
(1) Metric not meaningful |
|||||||||||||||
Noninterest expense increased by $0.3 million to $9.9 million for the quarter ended March 31, 2022 compared to the quarter ended March 31, 2021. The increase in noninterest expense was primarily driven by an increase in professional services expense and data processing expense.
Professional services expense totaled $1.0 million for the quarter ended March 31, 2022, an increase of $0.4 million when compared to the same period in 2021. The increase in professional services expense was primarily driven by consulting fees associated with various projects, including our core system conversion.
Data processing expense totaled $0.7 million for the quarter ended March 31, 2022, an increase of $0.1 million when compared to the same period in 2021. The increase in data processing expense was primarily driven by costs associated with our new online banking system.
BANKWELL FINANCIAL GROUP, INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURES (unaudited) (Dollars in thousands, except share data) |
|||||||||||
|
As of |
||||||||||
Computation of Tangible Common Equity to Tangible Assets |
March 31, 2022 |
|
December 31, 2021 |
|
March 31, 2021 |
||||||
Total Equity |
$ |
210,220 |
|
|
$ |
201,987 |
|
|
$ |
187,943 |
|
Less: |
|
|
|
|
|
||||||
Goodwill |
|
2,589 |
|
|
|
2,589 |
|
|
|
2,589 |
|
Other intangibles |
|
— |
|
|
|
— |
|
|
|
67 |
|
Tangible Common Equity |
$ |
207,631 |
|
|
$ |
199,398 |
|
|
$ |
185,287 |
|
|
|
|
|
|
|
||||||
Total Assets |
$ |
2,496,877 |
|
|
$ |
2,456,264 |
|
|
$ |
2,244,467 |
|
Less: |
|
|
|
|
|
||||||
Goodwill |
|
2,589 |
|
|
|
2,589 |
|
|
|
2,589 |
|
Other intangibles |
|
— |
|
|
|
— |
|
|
|
67 |
|
Tangible Assets |
$ |
2,494,288 |
|
|
$ |
2,453,675 |
|
|
$ |
2,241,811 |
|
|
|
|
|
|
|
||||||
Tangible Common Equity to Tangible Assets |
|
8.32 |
% |
|
|
8.13 |
% |
|
|
8.27 |
% |
|
As of |
|||||||
Computation of Fully Diluted Tangible Book Value per Common Share |
March 31, 2022 |
|
December 31, 2021 |
|
March 31, 2021 |
|||
Total shareholders' equity |
$ |
210,220 |
|
$ |
201,987 |
|
$ |
187,943 |
Less: |
|
|
|
|
|
|||
Preferred stock |
|
— |
|
|
— |
|
|
— |
Common shareholders' equity |
$ |
210,220 |
|
$ |
201,987 |
|
$ |
187,943 |
Less: |
|
|
|
|
|
|||
Goodwill |
|
2,589 |
|
|
2,589 |
|
|
2,589 |
Other intangibles |
|
— |
|
|
— |
|
|
67 |
Tangible common shareholders' equity |
$ |
207,631 |
|
$ |
199,398 |
|
$ |
185,287 |
|
|
|
|
|
|
|||
Common shares issued and outstanding |
|
7,761,338 |
|
|
7,803,166 |
|
|
7,908,630 |
|
|
|
|
|
|
|||
Fully Diluted Tangible Book Value per Common Share |
$ |
26.75 |
|
$ |
25.55 |
|
$ |
23.43 |
BANKWELL FINANCIAL GROUP, INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURES (unaudited) - Continued (Dollars in thousands) |
|||||||||||
|
For the Quarter Ended |
||||||||||
Computation of Efficiency Ratio |
March 31, 2022 |
|
December 31, 2021 |
|
March 31, 2021 |
||||||
Noninterest expense |
$ |
9,925 |
|
|
$ |
9,679 |
|
|
$ |
9,638 |
|
Less: |
|
|
|
|
|
||||||
Amortization of intangible assets |
|
— |
|
|
|
48 |
|
|
|
9 |
|
Other real estate owned expenses |
|
— |
|
|
|
— |
|
|
|
— |
|
Adjusted noninterest expense |
$ |
9,925 |
|
|
$ |
9,631 |
|
|
$ |
9,629 |
|
Net interest income |
$ |
19,510 |
|
|
$ |
18,928 |
|
|
$ |
14,655 |
|
Noninterest income |
|
958 |
|
|
|
825 |
|
|
|
1,956 |
|
Less: |
|
|
|
|
|
||||||
Net gain on sale of available for sale securities |
|
— |
|
|
|
— |
|
|
|
— |
|
Gain on sale of other real estate owned, net |
|
— |
|
|
|
— |
|
|
|
— |
|
Operating revenue |
$ |
20,468 |
|
|
$ |
19,753 |
|
|
$ |
16,611 |
|
|
|
|
|
|
|
||||||
Efficiency ratio |
|
48.5 |
% |
|
|
48.8 |
% |
|
|
58.0 |
% |
|
For the Quarter Ended |
||||||||||
Computation of Return on Average Tangible Common Equity |
March 31, 2021 |
|
December 31, 2020 |
|
March 31, 2021 |
||||||
Net Income Attributable to Common Shareholders |
$ |
8,212 |
|
|
$ |
7,814 |
|
|
$ |
5,690 |
|
Total average shareholders' equity |
$ |
207,541 |
|
|
$ |
200,752 |
|
|
$ |
182,058 |
|
Less: |
|
|
|
|
|
||||||
Average Goodwill |
|
2,589 |
|
|
|
2,589 |
|
|
|
2,589 |
|
Average Other intangibles |
|
— |
|
|
|
45 |
|
|
|
73 |
|
Average tangible common equity |
$ |
204,952 |
|
|
$ |
198,118 |
|
|
$ |
179,396 |
|
|
|
|
|
|
|
||||||
Annualized Return on Average Tangible Common Equity |
|
16.25 |
% |
|
|
15.65 |
% |
|
|
12.86 |
% |
BANKWELL FINANCIAL GROUP, INC. NET INTEREST MARGIN ANALYSIS ON A FULLY TAX EQUIVALENT BASIS - QTD (unaudited) (Dollars in thousands) |
|||||||||||||||||
|
For the Quarter Ended |
||||||||||||||||
|
March 31, 2022 |
|
March 31, 2021 |
||||||||||||||
|
Average Balance |
|
Interest |
|
Yield/ Rate (4) |
|
Average Balance |
|
Interest |
|
Yield/ Rate (4) |
||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash and Fed funds sold |
$ |
346,183 |
|
$ |
154 |
|
0.18 |
% |
|
$ |
401,900 |
|
$ |
108 |
|
0.11 |
% |
Securities(1) |
|
112,337 |
|
|
754 |
|
2.69 |
|
|
|
101,176 |
|
|
788 |
|
3.11 |
|
Loans: |
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial real estate |
|
1,343,565 |
|
|
14,997 |
|
4.46 |
|
|
|
1,129,224 |
|
|
12,731 |
|
4.51 |
|
Residential real estate |
|
73,835 |
|
|
671 |
|
3.64 |
|
|
|
112,053 |
|
|
964 |
|
3.44 |
|
Construction |
|
102,179 |
|
|
1,033 |
|
4.04 |
|
|
|
94,075 |
|
|
885 |
|
3.76 |
|
Commercial business |
|
383,115 |
|
|
4,625 |
|
4.83 |
|
|
|
294,756 |
|
|
3,271 |
|
4.44 |
|
Consumer |
|
6,054 |
|
|
102 |
|
6.85 |
|
|
|
5,039 |
|
|
49 |
|
3.94 |
|
Total loans |
|
1,908,748 |
|
|
21,428 |
|
4.49 |
|
|
|
1,635,147 |
|
|
17,900 |
|
4.38 |
|
Federal Home Loan Bank stock |
|
2,835 |
|
|
15 |
|
2.10 |
|
|
|
6,508 |
|
|
31 |
|
1.96 |
|
Total earning assets |
|
2,370,103 |
|
$ |
22,351 |
|
3.77 |
% |
|
|
2,144,731 |
|
$ |
18,827 |
|
3.51 |
% |
Other assets |
|
100,469 |
|
|
|
|
|
|
113,561 |
|
|
|
|
||||
Total assets |
$ |
2,470,572 |
|
|
|
|
|
$ |
2,258,292 |
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Liabilities and shareholders' equity: |
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
||||||
NOW |
$ |
112,199 |
|
$ |
47 |
|
0.17 |
% |
|
$ |
101,057 |
|
$ |
43 |
|
0.17 |
% |
Money market |
|
969,527 |
|
|
1,180 |
|
0.49 |
|
|
|
736,659 |
|
|
950 |
|
0.52 |
|
Savings |
|
194,463 |
|
|
101 |
|
0.21 |
|
|
|
160,347 |
|
|
125 |
|
0.32 |
|
Time |
|
453,805 |
|
|
878 |
|
0.78 |
|
|
|
611,153 |
|
|
1,996 |
|
1.32 |
|
Total interest bearing deposits |
|
1,729,994 |
|
|
2,206 |
|
0.52 |
|
|
|
1,609,216 |
|
|
3,114 |
|
0.78 |
|
Borrowed Money |
|
84,452 |
|
|
586 |
|
2.77 |
|
|
|
152,485 |
|
|
1,008 |
|
2.64 |
|
Total interest bearing liabilities |
|
1,814,446 |
|
$ |
2,792 |
|
0.62 |
% |
|
|
1,761,701 |
|
$ |
4,122 |
|
0.95 |
% |
Noninterest bearing deposits |
|
405,400 |
|
|
|
|
|
|
269,863 |
|
|
|
|
||||
Other liabilities |
|
43,185 |
|
|
|
|
|
|
44,670 |
|
|
|
|
||||
Total liabilities |
|
2,263,031 |
|
|
|
|
|
|
2,076,234 |
|
|
|
|
||||
Shareholders' equity |
|
207,541 |
|
|
|
|
|
|
182,058 |
|
|
|
|
||||
Total liabilities and shareholders' equity |
$ |
2,470,572 |
|
|
|
|
|
$ |
2,258,292 |
|
|
|
|
||||
Net interest income(2) |
|
|
$ |
19,559 |
|
|
|
|
|
$ |
14,705 |
|
|
||||
Interest rate spread |
|
|
|
|
3.15 |
% |
|
|
|
|
|
2.56 |
% |
||||
Net interest margin(3) |
|
|
|
|
3.30 |
% |
|
|
|
|
|
2.74 |
% |
||||
(1) Average balances and yields for securities are based on amortized cost. |
(2) The adjustment for securities and loans taxable equivalency amounted to $49 thousand and $50 thousand for the quarters ended March 31, 2022 and 2021, respectively. |
(3) Annualized net interest income as a percentage of earning assets. |
(4) Yields are calculated using the contractual day count convention for each respective product type. |
