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Bankwell Financial Group Reports Operating Results for the First Quarter and Declares Second Quarter Dividend

Bankwell Financial Group, Inc. (NASDAQ: BWFG) reported GAAP net income of $10.4 million, or $1.33 per share for the first quarter of 2023, versus $8.2 million, or $1.04 per share, for the same period in 2022.

The Company's Board of Directors declared a $0.20 per share cash dividend, payable May 23, 2023 to shareholders of record on May 12, 2023.

We recommend reading this earnings release in conjunction with the First Quarter 2023 Investor Presentation, located at http://investor.mybankwell.com/Presentations and included as an exhibit to our April 26, 2023 Current Report on Form 8-K.

Notes Bankwell Financial Group President and CEO, Christopher R. Gruseke:

"Bankwell delivered excellent results this quarter. Against the backdrop of a turbulent banking environment, we have maintained strong capital and liquidity levels. Our disciplined risk management practices have maintained outstanding credit quality and have protected the Bank's capital against rising interest rates. We have previously acknowledged and planned for the current environment of increased pressure on deposit costs, and can reiterate prior guidance for a year over year decline in Net Interest Income of approximately 10% for fiscal year 2023."

First Quarter 2023 Highlights:

  • Total gross loans were $2.8 billion, growing $83.8 million, or 3.1%, compared to December 31, 2022.
  • Deposits of $2.8 billion for the quarter ended March 31, 2023, unchanged from December 31, 2022.
  • FDIC-insured deposits totaled $2.0 billion and represent 70.3% of total deposits as of March 31, 2023.
  • As of March 31, 2023, the Bank has $1.5 billion immediately available liquidity, comprised of cash, AFS securities and borrowing capacity with the FHLB of Boston and FRB.
  • Immediately available liquidity provides 200% coverage of uninsured deposits.
  • Average yield on 2023 funded loans was 7.53% for the quarter ended March 31, 2023.
  • Return on average assets was 1.30% for the quarter ended March 31, 2023.
  • Return on average shareholders' equity was 17.48% for the quarter ended March 31, 2023.
  • The net interest margin was 3.24% for the quarter ended March 31, 2023.
  • The efficiency ratio was 46.9% for the quarter ended March 31, 2023.
  • Investment securities totaled $121.1 million and represent 3.7% of total assets, with HTM securities totaling $15.9 million, or 0.5% of total assets.
  • CECL adopted on January 1, 2023, resulting in a $5.1 million increase to the ACL-Loans and a $1.3 million adjustment to the ACL-Unfunded Commitments.

Earnings and Performance

Revenues (net interest income plus noninterest income) for the quarter ended March 31, 2023 were $27.1 million, versus $20.5 million for the quarter ended March 31, 2022. The increase in revenues was primarily attributable to an increase in interest and fees on loans due to loan growth and higher overall loan yields1 for the quarter ended March 31, 2023 and an increase in noninterest income mainly driven by additional SBA loan sales. The increase in revenues was partially offset by an increase in interest expense.

1 - The increase in overall loan yields was 138 bps for the quarter ended March 31, 2023

Net income for the quarter ended March 31, 2023 was $10.4 million, versus $8.2 million for the quarter ended March 31, 2022. The increase in net income was a direct result of the aforementioned increases in revenues. In addition, the increase in net income was partially offset by an increase in the provision for credit losses and an increase in noninterest expense for the quarter ended March 31, 2023.

Basic and diluted earnings per share were $1.34 and $1.33, respectively, for the quarter ended March 31, 2023 compared to basic and diluted earnings per share of $1.05 and $1.04, respectively, for the quarter ended March 31, 2022.

The net interest margin (fully taxable equivalent basis) for the quarters ended March 31, 2023 and March 31, 2022 was 3.24% and 3.30%, respectively. The decrease in the net interest margin was due to an increase in funding costs partially offset by an increase in overall loan yields.

Allowance for Credit Losses

Provision for credit losses was $826 thousand for the quarter ended March 31, 2023, bringing the ACL-Loans as a percentage of total loans to 1.01%. Provision for credit losses was $4.3 million for the quarter ended December 31, 2022. The decrease in the provision for credit losses is attributable to lower loan growth.

On January 1, 2023, the Company adopted ASC 326 Financial Instruments - Credit Losses ("CECL"). Upon adoption of CECL, the Company recorded a one-time cumulative effect, pre-tax adjustment $5.1 million to the ACL-Loans and a corresponding net of tax adjustment to beginning retained earnings. The Company also recorded a one-time cumulative effect, pre-tax adjustment of $1.3 million to the ACL-Unfunded Commitments (which is reflected in Accrued expenses and other liabilities on the Consolidated Balance Sheets) and a corresponding net of tax adjustment to beginning retained earnings.

Financial Condition

Assets totaled $3.25 billion at March 31, 2023 and remained flat compared to December 31, 2022. Gross loans totaled $2.8 billion at March 31, 2023, an increase of $83.8 million or 3.1% compared to December 31, 2022. Deposits totaled $2.8 billion at March 31, 2023, and remained flat compared to December 31, 2022.

Capital

Shareholders’ equity totaled $242.3 million as of March 31, 2023, an increase of $3.8 million compared to December 31, 2022, primarily a result of net income of $10.4 million for the quarter ended March 31, 2023. The increase was partially offset by the Day 1 CECL adoption of $4.9 million, dividends paid of $1.6 million, and a $0.9 million unfavorable impact to accumulated other comprehensive income. The unfavorable impact to accumulated other comprehensive income was driven by fair value marks on the Company's Available for sale investment securities portfolio of $6.1 million partially offset by fair value marks related to hedge positions involving interest rate swaps of $5.0 million. The Company's interest rate swaps are used to hedge interest rate risk.

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 Courtney E. Sacchetti, 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 increased competitive pressures, changes in the interest rate environment, general economic conditions or conditions within the banking industry or securities markets, 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 assets, tangible common equity to tangible assets, tangible common shareholders' equity, fully diluted tangible book value per common share, adjusted noninterest expense, operating revenue, efficiency ratio, average tangible common equity, annualized return on average tangible common equity, return on average assets, return on average shareholders' equity, and the dividend payout ratio 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,

2023

December 31,

2022

March 31,

2022

ASSETS

 

 

 

Cash and due from banks

$

249,812

 

$

344,925

 

$

280,471

 

Federal funds sold

 

27,370

 

 

10,754

 

 

19,022

 

Cash and cash equivalents

 

277,182

 

 

355,679

 

 

299,493

 

 

Investment securities

Marketable equity securities, at fair value

 

2,028

 

 

1,988

 

 

2,090

 

Available for sale investment securities, at fair value

 

103,171

 

 

103,663

 

 

98,733

 

Held to maturity investment securities, at amortized cost

 

15,931

 

 

15,983

 

 

15,979

 

Total investment securities

 

121,130

 

 

121,634

 

 

116,802

 

Loans receivable (net of ACL-Loans of $27,998, $22,431, and $17,141 at March 31, 2023, December 31, 2022, and March 31, 2022, respectively)

 

2,724,514

 

 

2,646,384

 

 

1,964,567

 

Accrued interest receivable

 

14,261

 

 

13,070

 

 

7,733

 

Federal Home Loan Bank stock, at cost

 

5,234

 

 

5,216

 

 

2,870

 

Premises and equipment, net

 

27,619

 

 

27,199

 

 

25,661

 

Bank-owned life insurance

 

50,524

 

 

50,243

 

 

49,434

 

Goodwill

 

2,589

 

 

2,589

 

 

2,589

 

Deferred income taxes, net

 

8,692

 

 

7,422

 

 

6,879

 

Other assets

 

20,573

 

 

23,013

 

 

20,849

 

Total assets

$

3,252,318

 

$

3,252,449

 

$

2,496,877

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities

Deposits

Noninterest bearing deposits

$

377,667

 

$

404,559

 

$

412,985

 

Interest bearing deposits

 

2,420,641

 

 

2,396,259

 

 

1,753,219

 

Total deposits

 

2,798,308

 

 

2,800,818

 

 

2,166,204

 

 

 

 

 

Advances from the Federal Home Loan Bank

 

90,000

 

 

90,000

 

 

50,000

 

Subordinated debentures

 

69,020

 

 

68,959

 

 

34,471

 

Accrued expenses and other liabilities

 

52,683

 

 

54,203

 

 

35,982

 

Total liabilities

 

3,010,011

 

 

3,013,980

 

 

2,286,657

 

 

 

 

 

Shareholders’ equity

 

 

 

Common stock, no par value

 

115,875

 

 

115,018

 

 

114,882

 

Retained earnings

 

127,566

 

 

123,640

 

 

99,047

 

Accumulated other comprehensive (loss) income

 

(1,134

)

 

(189

)

 

(3,709

)

Total shareholders’ equity

 

242,307

 

 

238,469

 

 

210,220

 

 

 

 

 

Total liabilities and shareholders’ equity

$

3,252,318

 

$

3,252,449

 

$

2,496,877

 

 

BANKWELL FINANCIAL GROUP, INC.

CONSOLIDATED STATEMENTS OF INCOME (unaudited)

(Dollars in thousands, except share data)
 

For the Quarter Ended

March 31,

2023

December 31,

2022

March 31,

2022

Interest and dividend income

 

 

 

Interest and fees on loans

$

39,723

$

36,545

 

$

21,428

 

Interest and dividends on securities

 

1,000

 

898

 

 

720

 

Interest on cash and cash equivalents

 

3,568

 

2,150

 

 

154

 

Total interest and dividend income

 

44,291

 

39,593

 

 

22,302

 

Interest expense

 

 

 

Interest expense on deposits

 

17,033

 

11,083

 

 

2,206

 

Interest expense on borrowings

 

1,717

 

1,701

 

 

586

 

Total interest expense

 

18,750

 

12,784

 

 

2,792

 

 

 

 

 

Net interest income

 

25,541

 

26,809

 

 

19,510

 

Provision for credit losses

 

826

 

4,272

 

 

229

 

Net interest income after provision for credit losses

 

24,715

 

22,537

 

 

19,281

 

Noninterest income

Bank owned life insurance

 

281

 

273

 

 

260

 

Service charges and fees

 

286

 

343

 

 

240

 

Gains and fees from sales of loans

 

931

 

12

 

 

631

 

Other

 

28

 

(100

)

 

(173

)

Total noninterest income

 

1,526

 

528

 

 

958

 

Noninterest expense

Salaries and employee benefits

 

6,081

 

5,988

 

 

4,940

 

Occupancy and equipment

 

2,084

 

1,919

 

 

2,150

 

Professional services

 

1,322

 

912

 

 

981

 

Data processing

 

671

 

663

 

 

654

 

Director fees

 

392

 

378

 

 

352

 

FDIC insurance

 

1,062

 

898

 

 

223

 

Marketing

 

151

 

112

 

 

45

 

Other

 

928

 

1,601

 

 

580

 

Total noninterest expense

 

12,691

 

12,471

 

 

9,925

 

Income before income tax expense

 

13,550

 

10,594

 

 

10,314

 

Income tax expense

 

3,171

 

2,573

 

 

2,102

 

Net income

$

10,379

$

8,021

 

$

8,212

 

Earnings Per Common Share:

 

 

 

Basic

$

1.34

$

1.04

 

$

1.05

 

Diluted

$

1.33

$

1.04

 

$

1.04

 

Weighted Average Common Shares Outstanding:

Basic

 

7,554,689

 

7,507,540

 

 

7,637,077

 

Diluted

 

7,616,671

 

7,563,116

 

 

7,719,405

 

Dividends per common share

$

0.20

$

0.20

 

$

0.20

 

BANKWELL FINANCIAL GROUP, INC.

CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited)

 

For the Quarter Ended

March 31,

2023

December 31,

2022

March 31,

2022

Performance ratios:

Return on average assets

1.30

%

1.07

%

1.35

%

Return on average shareholders' equity

17.48

%

13.38

%

16.05

%

Return on average tangible common equity

17.67

%

13.52

%

16.25

%

Net interest margin

3.24

%

3.70

%

3.30

%

Efficiency ratio(1)

46.9

%

45.6

%

48.5

%

Net loan charge-offs as a % of average loans

0.02

%

%

%

Dividend payout ratio(2)

15.04

%

19.23

%

19.23

%

(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,

2023

December 31,

2022

March 31,

2022

Capital ratios:

 

 

 

 

Total Common Equity Tier 1 Capital to Risk-Weighted Assets(1)

 

 

10.17

%

 

10.28

%

 

11.20

%

Total Capital to Risk-Weighted Assets(1)

 

 

11.16

%

 

11.07

%

 

12.00

%

Tier I Capital to Risk-Weighted Assets(1)

 

 

10.17

%

 

10.28

%

 

11.20

%

Tier I Capital to Average Assets(1)

 

 

9.22

%

 

9.88

%

 

9.80

%

Tangible common equity to tangible assets

 

 

7.38

%

 

7.26

%

 

8.32

%

Fully diluted tangible book value per common share

 

$

30.56

 

$

30.51

 

$

26.75

 

(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,

2023

December 31,

2022

March 31,

2022

ACL-Loans:

 

 

 

Balance at beginning of period

$

22,431

 

$

18,167

 

$

16,902

 

Day 1 CECL Adjustment on January 1, 2023

 

5,079

 

 

 

 

 

Beginning balance January 1, 2023

 

27,510

 

 

18,167

 

 

16,902

 

Charge-offs:

 

 

 

Commercial business

 

(440

)

 

 

 

 

Consumer

 

(12

)

 

(11

)

 

(4

)

Total charge-offs

 

(452

)

 

(11

)

 

(4

)

Recoveries:

 

 

 

Commercial real estate

 

 

 

 

 

 

Commercial business

 

 

 

 

 

13

 

Consumer

 

6

 

 

3

 

 

1

 

Total recoveries

 

6

 

 

3

 

 

14

 

Net loan (charge-offs) recoveries

 

(446

)

 

(8

)

 

10

 

Provision for credit losses - loans

 

934

 

 

4,272

 

 

229

 

Balance at end of period

$

27,998

 

$

22,431

 

$

17,141

 

 

 

As of

 

March 31,

2023

December 31,

2022

March 31,

2022

Asset quality:

 

 

 

Nonaccrual loans

 

 

 

Residential real estate

$

1,443

 

$

2,152

 

$

2,181

 

Commercial real estate

 

1,912

 

 

2,781

 

 

3,365

 

Commercial business

 

1,528

 

 

2,126

 

 

817

 

Construction

 

9,382

 

 

9,382

 

 

9,382

 

Total nonaccrual loans

 

14,265

 

 

16,441

 

 

15,745

 

Other real estate owned

 

 

 

 

 

 

Total nonperforming assets

$

14,265

 

$

16,441

 

$

15,745

 

 

Nonperforming loans as a % of total loans

 

0.52

%

 

0.61

%

 

0.79

%

Nonperforming assets as a % of total assets

 

0.44

%

 

0.51

%

 

0.63

%

ACL-loans as a % of total loans

 

1.01

%

 

0.84

%

 

0.86

%

ACL-loans as a % of nonperforming loans

 

196.27

%

 

136.43

%

 

108.87

%

Total past due loans to total loans

 

0.94

%

 

0.60

%

 

0.85

%

Total nonaccrual loans decreased $2.2 million to $14.3 million as of March 31, 2023 when compared to December 31, 2022. Nonperforming assets as a percentage of total assets decreased to 0.44% at March 31, 2023, down from 0.51% at December 31, 2022. The ACL-Loans at March 31, 2023 was $28.0 million, representing 1.01% of total loans.

Past due loans increased to $26.1 million, or 0.94% of total loans, as of March 31, 2023, compared to $16.1 million, or 0.60% of total loans, as of December 31, 2022. Of the March 31, 2023 past due loans, $10.0 million of loans were between 31 - 33 days past due and have subsequently become current. As of April 19, 2023, past due loans were $18.6 million or 0.67% of total loans.

 

BANKWELL FINANCIAL GROUP, INC.

LOAN & DEPOSIT PORTFOLIO (unaudited)

(Dollars in thousands)

 

Period End Loan Composition

March 31,

2023

December 31,

2022

% Change

Residential Real Estate

$

58,541

$

60,588

(3.4

) %

Commercial Real Estate(1)

 

1,960,712

 

1,921,252

2.1

 

Construction

 

177,115

 

155,198

14.1

 

Total Real Estate Loans

 

2,196,368

 

2,137,038

2.8

 

Commercial Business

 

543,457

 

520,447

4.4

 

Consumer

 

19,464

 

17,963

8.4

 

Total Loans

$

2,759,289

$

2,675,448

3.1

%

(1)

Includes owner occupied commercial real estate.

 

Gross loans totaled $2.8 billion at March 31, 2023, an increase of $83.8 million or 3.1% compared to December 31, 2022.

 

Period End Deposit Composition

March 31,

2023

December 31,

2022

% Change

Noninterest bearing demand

$

377,667

$

404,559

(6.6

) %

NOW

 

89,896

 

104,057

(13.6

)

Money Market

 

874,202

 

913,868

(4.3

)

Savings

 

117,986

 

151,944

(22.3

)

Time

 

1,338,557

 

1,226,390

9.1

 

Total Deposits

$

2,798,308

$

2,800,818

(0.1

)%

 

Total deposits were $2.8 billion at March 31, 2023, a decrease of $2.5 million, or 0.1%, when compared to December 31, 2022.

 

BANKWELL FINANCIAL GROUP, INC.

NONINTEREST INCOME (unaudited)

(Dollars in thousands)

For the Quarter Ended

Noninterest income

March 31,

2023

December 31,

2022

 

March 31,

2022

Mar 23 vs. Dec 22

% Change

Mar 23 vs. Mar 22

% Change

Bank owned life insurance

$

281

$

273

 

$

260

 

2.9

%

8.1

%

Service charges and fees

 

286

 

343

 

 

240

 

(16.6

)

19.2

 

Gains and fees from sales of loans

931

 

12

 

631

(7,658.3

)

47.5

Other

 

28

 

(100

)

 

(173

)

(128.0

)

116.2

 

Total noninterest income

$

1,526

$

528

 

$

958

 

189.0

%

59.3

%

Noninterest income increased by $0.6 million to $1.5 million for the quarter ended March 31, 2023 compared to the quarter ended March 31, 2022. The increase in noninterest income was driven by an increase in SBA loan sales during the first quarter of 2023.

 

BANKWELL FINANCIAL GROUP, INC.

NONINTEREST EXPENSE (unaudited)

(Dollars in thousands)

 

For the Quarter Ended

Noninterest expense

March 31,

2023

December 31,

2022

March 31,

2022

Mar 23 vs. Dec 22

% Change

Mar 23 vs. Mar 22

% Change

Salaries and employee benefits

$

6,081

$

5,988

$

4,940

1.6

%

23.1

%

Occupancy and equipment

 

2,084

 

1,919

 

2,150

8.6

 

(3.1

)

Professional services

 

1,322

 

912

 

981

45.0

 

34.8

 

Data processing

 

671

 

663

 

654

1.2

 

2.6

 

Director fees

 

392

 

378

 

352

3.7

 

11.4

 

FDIC insurance

 

1,062

 

898

 

223

18.3

 

376.2

 

Marketing

 

151

 

112

 

45

34.8

 

235.6

 

Other

 

928

 

1,601

 

580

(42.0

)

60.0

 

Total noninterest expense

$

12,691

$

12,471

$

9,925

1.8

%

27.9

%

Noninterest expense increased by $2.8 million to $12.7 million for the quarter ended March 31, 2023 compared to the quarter ended March 31, 2022. The increase in noninterest expense was primarily driven by an increase in salaries and employee benefits expense, professional services expense, and FDIC insurance.

Salaries and employee benefits expense totaled $6.1 million for the quarter ended March 31, 2023, an increase of $1.1 million when compared to the same period in 2022. The increase in salaries and employee benefits expense was driven by an increase in full time equivalent employees, with full time equivalent employees totaling 135 at March 31, 2023 compared to 126 for the same period in 2022. The increase in salaries and employee benefits expense was also due to lower loan originations, which reduced the amount of the Bank's ability to defer expenses.

Professional services expense totaled $1.3 million for the quarter ended March 31, 2023, an increase of $0.3 million when compared to the same period in 2022. The increase in professional services expense was primarily driven by consulting fees.

FDIC insurance expense totaled $1.1 million for the quarter ended March 31, 2023, an increase of $0.8 million when compared to the same period in 2022. The increase in FDIC insurance expense is attributed to the overall balance sheet growth, increased use of brokered deposits, and an increase in FDIC insurance rates.

 

BANKWELL FINANCIAL GROUP, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES (unaudited)

 

(Dollars in thousands, except share data)

 

 

As of

 

March 31,

December 31,

March 31,

Computation of Tangible Common Equity to Tangible Assets

 

2023

 

 

2022

 

 

2022

 

Total Equity

$

242,307

 

$

238,469

 

$

210,220

 

Less:

 

 

Goodwill

 

2,589

 

 

2,589

 

 

2,589

 

Other intangibles

 

 

 

 

 

 

Tangible Common Equity

$

239,718

 

$

235,880

 

$

207,631

 

 

 

 

Total Assets

$

3,252,318

 

$

3,252,449

 

$

2,496,877

 

Less:

 

 

Goodwill

 

2,589

 

 

2,589

 

 

2,589

 

Other intangibles

 

 

 

 

 

 

Tangible Assets

$

3,249,729

 

$

3,249,860

 

$

2,494,288

 

 

 

 

Tangible Common Equity to Tangible Assets

 

7.38

%

 

7.26

%

 

8.32

%

 
 

 

As of

 

March 31,

December 31,

March 31,

Computation of Fully Diluted Tangible Book Value per Common Share

2023

2022

2022

Total shareholders' equity

$

242,307

$

238,469

$

210,220

Less:

 

 

Preferred stock

 

 

 

Common shareholders' equity

$

242,307

$

238,469

$

210,220

Less:

 

 

 

Goodwill

 

2,589

 

2,589

 

2,589

Other intangibles

 

 

 

Tangible common shareholders' equity

$

239,718

$

235,880

$

207,631

 

 

 

 

Common shares issued and outstanding

 

7,843,438

 

7,730,699

 

7,761,338

 

 

 

 

Fully Diluted Tangible Book Value per Common Share

$

30.56

$

30.51

$

26.75

 

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,

2023

December 31,

2022

March 31,

2022

Noninterest expense

$

12,691

 

$

12,471

 

$

9,925

 

Less:

 

 

 

Amortization of intangible assets

 

 

 

 

 

 

Other real estate owned expenses

 

 

 

 

 

 

Adjusted noninterest expense

$

12,691

 

$

12,471

 

$

9,925

 

Net interest income

$

25,541

 

$

26,809

 

$

19,510

 

Noninterest income

 

1,526

 

 

528

 

 

958

 

Less:

 

 

 

Net gain on sale of available for sale securities

 

 

 

 

 

 

Gain on sale of other real estate owned, net

 

 

 

 

 

 

Operating revenue

$

27,067

 

$

27,337

 

$

20,468

 

 

 

 

 

Efficiency ratio

 

46.9

%

 

45.6

%

 

48.5

%

 

For the Quarter Ended

Computation of Return on Average Tangible Common Equity

March 31,

2023

December 31,

2022

March 31,

2022

Net Income Attributable to Common Shareholders

$

10,379

 

$

8,021

 

$

8,212

 

Total average shareholders' equity

$

240,833

 

$

237,922

 

$

207,541

 

Less:

 

 

 

Average Goodwill

 

2,589

 

 

2,589

 

 

2,589

 

Average Other intangibles

 

 

 

 

 

 

Average tangible common equity

$

238,244

 

$

235,333

 

$

204,952

 

 

 

 

 

Annualized Return on Average Tangible Common Equity

 

17.67

%

 

13.52

%

 

16.25

%

 

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, 2023

March 31, 2022

Average

Balance

Interest

Yield/ Rate (4)

Average

Balance

Interest

Yield/ Rate (4)

Assets:

Cash and Fed funds sold

$

315,566

$

3,568

4.59

%

$

346,183

$

154

0.18

%

Securities(1)

 

129,881

 

956

2.49

 

 

112,337

 

754

2.69

 

Loans:
Commercial real estate

 

1,918,551

 

25,585

5.33

 

 

1,343,565

 

14,997

4.46

 

Residential real estate

 

59,444

 

643

4.33

 

 

73,835

 

671

3.64

 

Construction

 

166,254

 

2,825

6.80

 

 

102,179

 

1,033

4.04

 

Commercial business

 

542,399

 

10,421

7.68

 

 

383,115

 

4,625

4.83

 

Consumer

 

18,536

 

249

5.45

 

 

6,054

 

102

6.85

 

Total loans

 

2,705,184

 

39,723

5.87

 

 

1,908,748

 

21,428

4.49

 

Federal Home Loan Bank stock

 

5,271

 

94

7.27

 

 

2,835

 

15

2.10

 

Total earning assets

 

3,155,902

$

44,341

5.62

%

 

2,370,103

$

22,351

3.77

%

Other assets

 

84,063

 

100,469

Total assets

$

3,239,965

$

2,470,572

 
Liabilities and shareholders' equity:
Interest bearing liabilities:

NOW

$

92,918

$

37

0.16

%

$

112,199

$

47

0.17

%

Money market

 

907,739

 

6,385

2.85

 

 

969,527

 

1,180

0.49

 

Savings

 

136,333

 

727

2.16

 

 

194,463

 

101

0.21

 

Time

 

1,252,564

 

9,883

3.20

 

 

453,805

 

878

0.78

 

Total interest bearing deposits

 

2,389,554

 

17,032

2.89

 

 

1,729,994

 

2,206

0.52

 

Borrowed Money

 

161,202

 

1,717

4.26

 

 

84,452

 

586

2.77

 

Total interest bearing liabilities

 

2,550,756

$

18,749

2.98

%

 

1,814,446

$

2,792

0.62

%

Noninterest bearing deposits

 

403,920

 

 

 

405,400

 

 

Other liabilities

 

44,406

 

 

 

43,185

 

 

Total liabilities

 

2,999,082

 

 

 

2,263,031

 

 

Shareholders' equity

 

240,883

 

 

 

207,541

 

 

Total liabilities and shareholders' equity

$

3,239,965

 

 

$

2,470,572

 

 

Net interest income(2)

 

$

25,592

 

 

$

19,559

 

Interest rate spread

 

 

2.64

%

 

 

3.15

%

Net interest margin(3)

 

 

3.24

%

 

 

3.30

%

(1)

Average balances and yields for securities are based on amortized cost.

(2)

The adjustment for securities and loans taxable equivalency amounted to $51 thousand and $49 thousand for the quarters ended March 31, 2023 and 2022, 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.

 

Contacts

Bankwell Financial Group

Christopher R. Gruseke, President and Chief Executive Officer

Courtney E. Sacchetti, Executive Vice President and Chief Financial Officer

(203) 652-0166

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