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Actionable news in CAC: Camden National Corporation,

Camden National Corporation Reports An 8% Increase In

The following excerpt is from the company's SEC filing.

Third Quarter 2015 Core Operating Earnings

CAMDEN, Maine, October 27, 2015/PRNewswire/--Camden National Corporation (NASDAQ: CAC; “Camden National” or the “Company”), a $2.9 billion bank holding company headquartered in Camden, Maine, reported third quarter 2015 core operating earnings

and core diluted earnings per share ("EPS")

of $7.0 million and $0.93 per share, respectively, representing increases of 8% over the third quarter of 2014. Our third quarter 2015 net income and diluted EPS of $6.5 million and $0.86 per share, respectively, as presented in accordance with accounting principles ge nerally accepted in the United States ("GAAP"), was flat compared to the third quarter of 2014, as it included one-time costs of $766,000 related to the merger with SBM Financial, Inc. (“SBM”) in the third quarter of 2015 that closed on October 16, 2015.

“The Company continues to deliver strong financial results while overseeing the successful merger of SBM and its subsidiary bank, The Bank of Maine, into Camden National and Camden National Bank," said Gregory A. Dufour, president and chief executive officer of the Company.

Core operating earnings

and core diluted EPS

for the nine months ended September 30, 2015 were $20.5 million and $2.74 per share, respectively, representing increases of 13% over the same period of 2014. GAAP net income and diluted EPS for the nine months ended September 30, 2015 were $19.3 million and $2.57, respectively, representing increases of 4% over the same period of 2014.

Dufour added, "We completed the merger of SBM into Camden National on October 16, 2015, marking a significant milestone in the 140 year history of Camden National. The merger of these two companies not only creates size and scale but allows Camden to increase its visibility and viability within the southern Maine markets with an immediate and already established presence, while expanding our mortgage origination capabilities across New England."

Financial Highlights

Third quarter 2015 core operating earnings increased $500,000, or 8%, over the third quarter of 2014, while year-to-date September 30, 2015 core operating earnings increased $2.3 million, or 13%, over the same period of 2014

Third quarter 2015 core diluted EPS increased $0.07 per share, or 8%, over the third quarter of 2014, while year-to-date September 30, 2015 core diluted EPS increased $0.32 per share, or 13%

Asset quality continues to improve as non-performing assets to total assets of 0.54% at September 30, 2015 decreased 5 basis points since the prior quarter and 28 basis points since year-end

On October 16, 2015, Camden National and SBM completed their merger, creating Maine’s largest community bank and significantly expanding the franchise within Southern Maine

Balance Sheet

Total assets at September 30, 2015 were $2.9 billion, representing an increase of $81.9 million, or 3%, since year-end. The growth in total assets was driven primarily by an increase in loans (including loans held for sale) of $58.4 million, or 3%. Our loan growth was centered within the commercial real estate portfolio, which has increased $50.3 million since December 31, 2014. Our commercial loan portfolio now makes up 52% due to our continued focus on becoming Maine's business bank and supporting the growth and economic development across all communities that we serve. The retail loan portfolio saw modest growth of $6.7 million, or 1%, since year-end, which is in large part due to our strategic shift in 2015 to sell all 30-year mortgage production. For the nine months ended September 30, 2015, the Company has sold $24.5 million of 30-year mortgage production.

_____________________________________________________________________________________________

This is a non-GAAP measure. Please refer to the "Reconciliation of non-GAAP to GAAP Financial Measures" for further details.

Total deposits (excluding brokered deposits) at September 30, 2015 were $1.8 billion, representing an increase of $64.9 million, or 4%, since year-end. Non-interest bearing demand deposits increased $45.6 million, or 17%, at September 30, 2015 compared to year-end largely due to the seasonality of core deposits within our markets across Maine, but we also experienced a $26.8 million, or 10%, increase over September 30, 2014. Certificates of deposit increased $22.8 million since year-end as one significant depositor shifted funds into a 6-month term in the third quarter of 2015. Total borrowings (including brokered deposits) were $792.8 million at September 30, 2015, representing a decrease of $1.9 million since year-end. The decrease is due to the seasonal inflow of core deposits.

Third Quarter 2015 Core Operating Results

Core operating earnings for the third quarter of 2015 totaled $7.0 million, representing an increase of $500,000, or 8%, compared to the third quarter of 2014. The primary factors driving the increase in core operating earnings were:

Net interest income on a fully-taxable basis increased $801,000 to $20.5 million compared to the third quarter of 2014. The 4% increase in net interest income was primarily driven by an increase in average loan balances of $101.0 million, or 6%, and partially offset by a 2 basis point decrease in net interest margin to 3.08%.

Non-interest income, excluding gains on the sale of investment securities, increased $603,000 to $6.6 million compared to the third quarter last year. This 10% increase was driven by higher mortgage banking income of $335,000 from mortgage sales and $435,000 of income recognized on loan swaps in the third quarter of 2015 that did not occur in the third quarter of 2014.

Provision for credit losses of $279,000 for the third quarter of 2015 was $260,000 lower than the same period last year. The decrease in the provision was reflective of continued asset quality improvement, highlighted by a decrease in our non-performing loans to total loans of 52 basis points to 0.83% since September 30, 2014. Net charge-offs to average loans (annualized) for the third quarter of 2015 were 0.08%, representing a 12 basis points improvement over the same period last year, while loans 30-89 days past due to total loans at September 30, 2015 were 0.18% compared to 0.38% a year ago.

Non-interest expense, excluding non-recurring costs associated with the merger, increased 5% to $15.9 million for the third quarter of 2015 compared to the third quarter of 2014. The increase is due to higher salaries and employee benefits of $613,000, which was driven by normal employee merit increases and higher incentive accruals due to strong year-to-date performance. Other operating expenses increased $222,000 due to costs associated with enhancing our website platform and statement mailings totaling $123,000, and higher losses associated with check and debit card fraud of $71,000.

Year-To-Date Core Operating Results

Core operating earnings for the nine-months ended September 30, 2015 totaled $20.5 million, representing an increase of $2.3 million, or 13%, compared to the same period of 2014. The primary factors driving the increase in core operating earnings were:

Net interest income on a fully-taxable basis increased $3.5 million to $61.3 million compared to the same period last year. This 6% increase was driven by average loan portfolio growth of $138.9 million, or 8%. Net interest margin increased 2 basis points to 3.12% compared to the same period a year ago. The increase was driven by a full pay-off of one significant commercial real estate loan in the second quarter of 2015 that was on non-accrual status. The Company recognized $734,000 of interest income upon pay-off of this loan, and excluding this one-time event, net interest margin for the nine months ended September 30, 2015 decreased 2 basis points to 3.08% basis points compared to a the same period a year ago.

Non-interest income, excluding gains on the sale of investment securities, increased $1.3 million to $19.0 million compared to the same period last year. This 7% increase was driven by higher mortgage banking income of $778,000, incremental bank-owned life insurance income of $292,000 from the additional $10.0 million investment made in the third quarter last year, and higher income on loan swaps...


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