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CST: 21/08/2019 23:38:41   

Bryn Mawr Bank Corporation Reports $1.3 Billion Linked Quarter Increase in Wealth Assets, Records $4.5 Million Pre-Tax Charge for Years of Service Incentive Program, Declares $0.25 Dividend

125 Days ago

BRYN MAWR, Pa., April 18, 2019 (GLOBE NEWSWIRE) -- Bryn Mawr Bank Corporation (NASDAQ: BMTC) (the “Corporation”), parent of The Bryn Mawr Trust Company (the “Bank”) today reported net income of $10.7 million, or $0.53 diluted earnings per share for the three months ended March 31, 2019, as compared to net income of $17.1 million, or $0.84 diluted earnings per share, for the three months ended December 31, 2018, and $15.3 million, or $0.75 diluted earnings per share, for the three months ended March 31, 2018.

On a non-GAAP basis, core net income, which excludes one-time costs associated with our voluntary Years of Service Incentive Program (the “Incentive Program”), income tax charges incurred in connection with the Tax Cuts and Jobs Act ("Tax Reform"), due diligence and merger-related expenses and other non-core income and expense items, as detailed in the appendix to this earnings release, was $14.2 million, or $0.70 diluted earnings per share, for the three months ended March 31, 2019, as compared to $17.2 million, or $0.84 diluted earnings per share, for the three months ended December 31, 2018, and $19.3 million, or $0.94 diluted earnings per share, for the three months ended March 31, 2018. Management believes the core net income measure is important in evaluating the Corporation’s performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

“We are excited with the start of 2019 as we continue to execute upon our long-term strategic goals,” commented Frank Leto, President and Chief Executive Officer, continuing, “Part of our long-term plan is ensuring BMT’s sustainability through proper succession planning. To facilitate the execution of this goal, the Board and executive management team created a one-time, voluntary Years of Service Incentive Program to reward certain long-tenured employees with enhanced benefits while providing BMT with the ability to manage a controlled transition process related to the leadership and knowledge held by individuals who chose to participate. We are proud to have been able to offer this Incentive Program, recognizing that it is our people who have laid the foundation on which we have succeeded for the past 130 years, and it is our people who will enable us to continue to grow and succeed in the future.”

Mr. Leto then continued, “Our first quarter financials remained strong with loan growth of $96 million, or 11% on an annualized basis from year-end, and wealth assets under management approaching $15 billion. Our capital markets team also continues to provide strong fee-based revenue, while credit quality remains strong with the first quarter provision expense primarily impacted by a single credit. With regard to the Incentive Program, we expect to realize long-term savings and recoup the cost of the Incentive Program in approximately three years. I am also pleased to announce that the Board of Directors has authorized a new stock repurchase program under which the Corporation can repurchase up to 1,000,000 shares from time to time at an aggregate purchase price not to exceed $45 million (the "New Repurchase Program"). The New Repurchase Program will become effective upon the completion of the Corporation’s existing 2015 stock repurchase program.”

The Board of Directors of the Corporation declared a quarterly dividend of $0.25 per share, payable June 1, 2019 to shareholders of record as of May 1, 2019.

SIGNIFICANT ITEMS OF NOTE

Results of Operations – First Quarter 2019 Compared to Fourth Quarter 2018

  • Net income for the three months ended March 31, 2019 was $10.7 million, as compared to net income of $17.1 million for the three months ended December 31, 2018. Net interest income for the three months ended March 31, 2019 was $37.6 million, a decrease of $340 thousand over the linked quarter. The provision for loan and lease losses (the “Provision”) for the three months ended March 31, 2019 increased $1.4 million as compared to the fourth quarter of 2018. Total noninterest income increased $1.2 million, total noninterest expense increased $4.9 million, and income tax expense increased $1.0 million for the three months ended March 31, 2019, as compared to the three months ended December 31, 2018. During the first quarter of 2019, the Corporation adopted the Incentive Program which offers certain benefits to eligible employees who meet the Incentive Program requirements and voluntarily exit from service with the Corporation, the Bank or one of their subsidiaries. Noninterest expense for the first quarter of 2019 included a pre-tax, non-recurring, charge of $4.5 million related to the Incentive Program.

    On a non-GAAP basis, core net income, which excludes one-time costs associated with the Incentive Program, income tax charges incurred in connection with Tax Reform, due diligence and merger-related expenses and other non-core income and expense items, as detailed in the appendix to this earnings release, was $14.2 million, or $0.70 per diluted share, for the three months ended March 31, 2019, as compared to $17.2 million or $0.84 per diluted share, for the three months ended December 31, 2018. Management believes the core net income measure is important in evaluating the Corporation’s performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Net interest income for the three months ended March 31, 2019 was $37.6 million, a decrease of $340 thousand over the linked quarter. Tax-equivalent net interest income for the three months ended March 31, 2019 was $37.8 million, a decrease of $338 thousand over the linked quarter. Tax-equivalent net interest income for the first quarter of 2019 was impacted by the accretion of purchase accounting fair value marks of $2.1 million as compared to $2.7 million for the linked quarter. Excluding the effects of these purchase accounting fair value marks, the adjusted tax-equivalent net interest income for the three months ended March 31, 2019 was $35.6 million, an increase of $213 thousand over the linked quarter. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release. Items contributing to the increase adjusted for purchase accounting included increases of $1.1 million and $388 thousand in tax-equivalent interest and fees earned on loans and leases and interest earned on available for sale investment securities, respectively, partially offset by an increase of $1.3 million in interest paid on deposits for the three months ended March 31, 2019 as compared to the linked quarter ended December 31, 2018.

    Tax-equivalent interest and fees earned on loans and leases for the three months ended March 31, 2019 increased $571 thousand over the linked quarter. Average loans and leases for the three months ended March 31, 2019 increased $78.3 million over the linked quarter and experienced a 6 basis point increase in tax-equivalent yield.

    Tax-equivalent interest income on available for sale investment securities increased $388 thousand for the first quarter of 2019 as compared to the linked quarter. Average available for sale investment securities increased by $16.2 million over the linked quarter and experienced a 27 basis point tax-equivalent yield increase.

    Interest expense on deposits for the three months ended March 31, 2019 increased $1.0 million over the linked quarter. Average interest-bearing deposits increased $71.8 million coupled with a 16 basis point increase in the rate paid on deposits as compared to the linked quarter. The increase in interest on deposits was related to the competitive dynamics in the markets in which we operate and certain promotional interest rates offered during the quarter.

    Interest expense on short-term borrowings for the three months ended March 31, 2019 increased $262 thousand over the linked quarter. Average short-term borrowings increased $29.2 million coupled with a 33 basis point increase in the rate paid on short-term borrowings as compared to the linked quarter.

  • The tax-equivalent net interest margin was 3.75% for the three months ended March 31, 2019 as compared to 3.79% for the linked quarter. Adjusting for the impact of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest margin was 3.54% for the three months ended March 31, 2019 as compared to 3.52% for the linked quarter. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Noninterest income of $19.3 million for the three months ended March 31, 2019 increased $1.2 million as compared to the linked quarter. Contributing to the increase were increases of $1.8 million, $852 thousand, and $213 thousand in other operating income, capital markets revenue, and insurance commissions, respectively, partially offset by decreases of $1.3 million and $625 thousand in net gain on sale of loans and fees for wealth management services, respectively. The $1.8 million increase in other operating income was primarily due to a $1.6 million increase in gains on trading securities over the linked quarter due to market fluctuations affecting the Corporation's executive and director deferred compensation plan assets.

  • Noninterest expense of $39.7 million for the three months ended March 31, 2019 increased $4.9 million as compared to $34.8 million for the fourth quarter of 2018. The increase on a linked quarter basis was primarily due to increases of $3.0 million, $1.2 million, and $1.0 million in salaries and wages, employee benefits, and other operating expenses, respectively. The linked quarter increase in salaries and wages and employee benefits was largely driven by the expenses from the Incentive Program.

  • The Provision increased $1.3 million for the three months ended March 31, 2019 to $3.7 million, as compared to $2.4 million for the fourth quarter of 2018. During the first quarter of 2019, portfolio loans and leases increased $96.4 million. In addition, net loan and lease charge-offs increased by $926 thousand for the first quarter of 2019, as compared to the previous quarter. The 2.8% increase in loan and lease volume and 57.2% increase in net charge-offs were the primary drivers for the increase in the Provision on a linked-quarter basis. The increase in net charge-offs was primarily a result of the partial charge-off of a single commercial credit.  Nonperforming loans and leases as of March 31, 2019 totaled $19.3 million, an increase of $6.5 million from December 31, 2018. The increase in nonperforming loans was largely due to real estate collateralized loans for which management performs an impairment analysis. All nonperforming loans are carried at their net realizable value.

  • The effective tax rate for the first quarter of 2019 increased significantly as compared to the fourth quarter of 2018. The increase in the effective tax rate was primarily due to a $2.6 million tax benefit recorded in the fourth quarter of 2018 for certain discrete items included on our 2017 tax return which was filed during the fourth quarter of 2018. The effective tax rate for the year ended December 31, 2018, excluding discrete income tax benefits, was 21.7%.

Results of Operations – First Quarter 2019 Compared to First Quarter 2018

  • Net income for the three months ended March 31, 2019 was $10.7 million, or $0.53 diluted earnings per share, as compared to net income of $15.3 million, or diluted earnings per share of $0.75 for the same period in 2018. Contributing to the net income decrease were increases of $3.7 million and $2.7 million in noninterest expense and the Provision, respectively.

    On a non-GAAP basis, core net income, which excludes one-time costs associated with the Incentive Program, income tax charges incurred in connection with Tax Reform, due diligence and merger-related expenses and other non-core income and expense items, as detailed in the appendix to this earnings release, was $14.2 million, or $0.70 per diluted share, for the three months ended March 31, 2019 as compared to $19.3 million, or $0.94 per diluted share, for the same period in 2018. Management believes the core net income measure is important in evaluating the Corporation’s performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Net interest income for the three months ended March 31, 2019 was $37.6 million, an increase of $208 thousand as compared to the same period in 2018. Tax-equivalent net interest income for the three months ended March 31, 2019 was $37.8 million, an increase of $256 thousand as compared to the same period in 2018. Tax-equivalent net interest income for the first quarter of 2019 was impacted by the accretion of purchase accounting fair value marks of $2.1 million as compared to $3.0 million for the same period in 2018. Excluding the effects of these purchase accounting fair value marks, the adjusted tax-equivalent net interest income for the three months ended March 31, 2019 was $35.6 million, an increase of $1.1 million as compared to the same period in 2018. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release. Items contributing to the increase adjusted for purchase accounting included increases of $4.8 million and $812 thousand in tax-equivalent interest and fees earned on loans and leases and interest earned on available for sale investment securities, respectively, partially offset by an increase of $4.5 million in interest paid on deposits for the three months ended March 31, 2019 as compared to the same period in 2018.

    Tax-equivalent interest and fees on loans and leases increased $4.1 million for the three months ended March 31, 2019 as compared to the same period in 2018. Average loans and leases for the first quarter of 2019 increased $186.5 million from the same period in 2018 and experienced a 21 basis point increase in tax-equivalent yield.

    Average available for sale investment securities increased by $34.3 million for the three months ended March 31, 2019 as compared to the same period in 2018 and experienced a 46 basis point tax-equivalent yield increase. The increase in average balances and yield on available for sale investment securities resulted in an $812 thousand increase in tax-equivalent interest income on available for sale investment securities for the first quarter of 2019 as compared to the same period in 2018.

    Partially offsetting the effect on net interest income associated with the increase in average loans and leases and available for sale investment securities was a $4.6 million increase in interest expense on deposits for the three months ended March 31, 2019 as compared to the same period in 2018. Average interest-bearing deposits increased by $238.7 million, coupled with a 65 basis point increase in rate paid for the first quarter of 2019 as compared to the same period in 2018.

  • The tax-equivalent net interest margin was 3.75% for the three months ended March 31, 2019 as compared to 3.94% for the same period in 2018. Adjusting for the impact of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest margin was 3.54% and 3.62% for three months ended March 31, 2019 and 2018, respectively. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Noninterest income of $19.3 million for the three months ended March 31, 2019 decreased by $283 thousand as compared to the same period in 2018. Contributing to this decrease were decreases of $1.5 million, $200 thousand, and $199 thousand in other operating income, net gain on sale of other real estate owned, and net gain on sale of loans, respectively. The decrease in other operating income was primarily due to a $2.2 million decrease in recoveries of purchase accounting fair value marks resulting from pay-offs of previously acquired credit-impaired loans for the three months ended March 31, 2019 as compared to the same period in 2018. Partially offsetting the decrease in noninterest income was an increase of $1.6 million in capital markets revenue which was primarily due to increased volume of capital market transactions.

  • Noninterest expense of $39.7 million for the three months ended March 31, 2019 increased $3.7 million as compared to the same period in 2018. Contributing to the $3.7 million increase were increases of $4.9 million, $1.2 million, $572 thousand, $491 thousand, and $458 thousand in salaries and wages, other operating expenses, professional fees, furniture, fixtures and equipment expenses, and employee benefits, respectively. The increases in salaries and wages and employee benefits was largely driven by the expenses incurred in connection with the Incentive Program. Partially offsetting these increases in noninterest expense was a decrease of $4.3 million in due diligence, merger-related and merger integration expenses for the three months ended March 31, 2019 as compared to the same period in 2018.

  • The Provision increased $2.7 million for the three months ended March 31, 2019 to $3.7 million, as compared to $1.0 million for the same period in 2018. In addition, net loan and lease charge-offs increased by $1.7 million for the first quarter of 2019, as compared to the same period in 2018. This 6.6% increase in loan and lease volume and 185.1% increase in net charge-offs were the primary drivers for the increase in the Provision on a year-over-year basis. Nonperforming loans and leases as of March 31, 2019 totaled $19.3 million, an increase of $11.8 million from March 31, 2018. The increase in nonperforming loans was comprised primarily of real estate collateralized loans for which management performs impairment analyses. All nonperforming loans are carried at their net realizable value.

  • The effective tax rate for the first quarter of 2019 decreased to 20.57% as compared to 23.25% for the first quarter of 2018. The decrease was primarily due to $590 thousand of discrete tax charges included in tax expense in the first quarter of 2018 related to the re-measurement of net deferred tax assets as a result of Tax Reform, related to revised fair value adjustments associated with the merger with Royal Bancshares of Pennsylvania, Inc. in December 2017.

Financial Condition – March 31, 2019 Compared to December 31, 2018

  • Total assets as of March 31, 2019 were $4.63 billion, a decrease of $20.5 million from December 31, 2018. The decrease was primarily due to the decrease in available for sale investment securities discussed in the bullet point below, partially offset by the increase in portfolio loans and leases discussed in the bullet point below, as well as $44.0 million of operating lease right-of-use assets as of March 31, 2019 included on the balance sheet as a result of a recently adopted accounting pronouncement.

  • Available for sale investment securities as of March 31, 2019 totaled $560.0 million, a decrease of $177.5 million from December 31, 2018. The decrease was primarily related to the maturing, in January 2019, of $200.0 million short-term U.S. Treasury securities, partially offset by a $33.0 million increase in mortgage-backed securities.

  • Total portfolio loans and leases of $3.52 billion as of March 31, 2019 increased by $96.4 million from December 31, 2018, an increase of 2.8%. Increases of $89.3 million, $11.8 million, $10.1 million and $8.0 million in commercial mortgages, leases, commercial and industrial loans and residential mortgages, respectively, were offset by decreases of $21.3 million and $2.6 million in construction loans and home equity loans and lines, respectively.

  • The Allowance as of March 31, 2019 was $20.6 million, or 0.59% of portfolio loans and leases, as compared to $19.4 million, or 0.57% of portfolio loans and leases as of December 31, 2018. In addition to the ratio of Allowance to portfolio loans and leases, management also calculates two non-GAAP measures: the Allowance for originated loans and leases as a percentage of originated loans and leases, which was 0.68% as of March 31, 2019, as compared to 0.67% as of December 31, 2018, and the Allowance plus the remaining loan mark as a percentage of gross loans, which was 1.03% as of March 31, 2019, as compared to 1.08% as of December 31, 2017. A reconciliation of these and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Deposits of $3.64 billion as of March 31, 2019 increased $38.5 million from December 31, 2018. Increases of $98.7 million and $18.5 million in money market and savings accounts, respectively, were partially offset by decreases of $40.9 million, $19.3 million, $11.2 million, and $7.3 million in wholesale deposits, noninterest-bearing demand accounts, retail time deposits and wholesale non-maturity deposits, respectively.

  • Borrowings of $299.8 million as of March 31, 2019, which include short-term borrowings, long-term FHLB advances, subordinated notes and junior subordinated debentures, decreased $128.0 million from December 31, 2018, primarily due to decreases in short-term borrowings.

  • Wealth assets under management, administration, supervision and brokerage totaled $14.74 billion as of March 31, 2019, an increase of $1.31 billion from December 31, 2018.

  • The capital ratios for the Bank and the Corporation, as of March 31, 2019, as shown in the attached tables, indicate levels above the regulatory minimum to be considered “well capitalized.”

FORWARD LOOKING STATEMENTS AND SAFE HARBOR
This press release contains statements which, to the extent that they are not recitations of historical fact may constitute forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Such forward-looking statements may include financial and other projections as well as statements regarding the Corporation’s future plans, objectives, performance, revenues, growth, profits, operating expenses or the Corporation’s underlying assumptions. The words “may,” “would,” “should,” “could,” “will,” “likely,” “possibly,” “expect,” “anticipate,” “intend,” “indicate,” “estimate,” “target,” “potentially,” “promising,” “probably,” “outlook,” “predict,” “contemplate,” “continue,” “plan,” “forecast,” “project,” “are optimistic,” “are looking,” “are looking forward” and “believe” or other similar words and phrases may identify forward-looking statements. Persons reading this press release are cautioned that such statements are only predictions, and that the Corporation’s actual future results or performance may be materially different.

Such forward-looking statements involve known and unknown risks and uncertainties. A number of factors, many of which are beyond the Corporation's control, could cause our actual results, events or developments, or industry results, to be materially different from any future results, events or developments expressed, implied or anticipated by such forward-looking statements, and so our business and financial condition and results of operations could be materially and adversely affected. Such factors include, among others, our inability to successfully integrate acquired businesses, the possibility that integration may take longer than anticipated or be more costly to complete and that the anticipated benefits, including any anticipated cost savings or strategic gains may be significantly harder to achieve or take longer than anticipated or may not be achieved, our need for capital, our ability to control operating costs and expenses, and to manage loan and lease delinquency rates; the credit risks of lending activities and overall quality of the composition of our loan, lease and securities portfolio; the impact of economic conditions, consumer and business spending habits, and real estate market conditions on our business and in our market area; changes in the levels of general interest rates, deposit interest rates, or net interest margin and funding sources; changes in banking regulations and policies and the possibility that any banking agency approvals we might require for certain activities will not be obtained in a timely manner or at all or will be conditioned in a manner that would impair our ability to implement our business plans; changes in accounting policies and practices; litigation; cybersecurity events; the inability of key third-party providers to perform their obligations to us; our ability to attract and retain key personnel; competition in our marketplace; war or terrorist activities; material differences in the actual financial results, cost savings and revenue enhancements associated with our acquisitions; and other factors as described in our securities filings. All forward-looking statements and information set forth herein are based on management’s current beliefs and assumptions as of the date hereof and speak only as of the date they are made.  The Corporation does not undertake to update forward-looking statements.

For a complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K, as updated by our quarterly or other reports subsequently filed with the SEC.

FOR MORE INFORMATION CONTACT:

Frank Leto, President, CEO
610-581-4730
Mike Harrington, CFO
610-526-2466

Bryn Mawr Bank Corporation
Summary Financial Information (unaudited)
(dollars in thousands, except per share data)

  As of or For the Three Months Ended
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Consolidated Balance Sheet (selected items)                  
Interest-bearing deposits with banks $ 29,449     $ 34,357     $ 35,233     $ 39,924     $ 24,589  
Investment securities 578,629     753,628     545,320     547,088     550,199  
Loans held for sale 2,884     1,749     4,111     4,204     5,522  
Portfolio loans and leases 3,523,514     3,427,154     3,381,475     3,389,501     3,305,795  
Allowance for loan and lease losses ("ALLL") (20,616 )   (19,426 )   (18,684 )   (19,398 )   (17,662 )
Goodwill and other intangible assets 206,006     207,467     208,165     208,139     207,287  
Total assets 4,631,993     4,652,485     4,388,442     4,394,203     4,300,376  
Deposits - interest-bearing 2,755,307     2,697,468     2,522,863     2,466,529     2,452,421  
Deposits - non-interest-bearing 882,310     901,619     834,363     892,386     863,118  
Short-term borrowings 124,214     252,367     226,498     227,059     173,704  
Long-term FHLB advances 55,407     55,374     72,841     87,808     107,784  
Subordinated notes 98,571     98,526     98,482     98,491     98,448  
Jr. subordinated debentures 21,622     21,580     21,538     21,497     21,456  
Total liabilities 4,056,886     4,087,781     3,837,017     3,851,700     3,767,315  
Total shareholders' equity 575,107     564,704     551,425     542,503     533,061  
Average Balance Sheet (selected items)                  
Interest-bearing deposits with banks 32,742     38,957     37,467     37,215     38,044  
Investment securities 569,915     554,265     546,998     549,249     535,471  
Loans held for sale 1,214     2,005     4,932     4,413     2,848  
Portfolio loans and leases 3,476,525     3,397,479     3,374,767     3,348,926     3,288,364  
Total interest-earning assets 4,080,396     3,992,706     3,964,164     3,939,803     3,864,727  
Goodwill and intangible assets 206,716     207,893     207,880     208,039     205,529  
Total assets 4,545,129     4,413,000     4,376,148     4,344,541     4,246,180  
Deposits - interest-bearing 2,674,194     2,602,412     2,493,213     2,489,296     2,435,491  
Short-term borrowings 157,652     128,429     208,201     205,323     172,534  
Long-term FHLB advances 55,385     67,363     81,460     102,023     123,920  
Subordinated notes 98,542     98,497     98,457     98,463     98,430  
Jr. subordinated debentures 21,595     21,553     21,511     21,470     21,430  
Total interest-bearing liabilities 3,007,368     2,918,254     2,902,842     2,916,575     2,851,805  
Total liabilities 3,973,043     3,856,694     3,828,241     3,810,640     3,719,746  
Total shareholders' equity 572,086     556,306     547,907     533,901     526,434  


  As of or For the Three Months Ended
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Income Statement                  
Net interest income $ 37,647     $ 37,987     $ 36,729     $ 37,316     $ 37,439  
Provision for loan and lease losses 3,736     2,362     664     3,137     1,030  
Noninterest income 19,253     18,097     18,274     20,075     19,536  
Noninterest expense 39,724     34,845     33,592     35,836     36,030  
Income tax expense 2,764     1,746     4,066     3,723     4,630  
Net income 10,676     17,131     16,681     14,695     15,285  
Net (loss) income attributable to noncontrolling interest (1 )   (5 )   (1 )   7     (1 )
Net income attributable to Bryn Mawr Bank Corporation 10,677     17,136     16,682     14,688     15,286  
Basic earnings per share 0.53     0.85     0.82     0.73     0.76  
Diluted earnings per share 0.53     0.84     0.82     0.72     0.75  
Net income (core) (1) 14,230     17,167     17,140     17,031     19,282  
Basic earnings per share (core) (1) 0.71     0.85     0.85     0.84     0.95  
Diluted earnings per share (core) (1) 0.70     0.84     0.84     0.83     0.94  
Dividends paid or accrued per share 0.25     0.25     0.25     0.22     0.22  
Profitability Indicators                  
Return on average assets 0.95 %   1.54 %   1.51 %   1.36 %   1.46 %
Return on average equity 7.57 %   12.22 %   12.08 %   11.03 %   11.78 %
Return on tangible equity(1) 12.65 %   20.37 %   20.25 %   18.90 %   20.15 %
Return on tangible equity (core)(1) 16.59 %   20.40 %   20.78 %   21.78 %   25.19 %
Return on average assets (core)(1) 1.27 %   1.54 %   1.55 %   1.57 %   1.84 %
Return on average equity (core)(1) 10.09 %   12.24 %   12.41 %   12.79 %   14.85 %
Tax-equivalent net interest margin 3.75 %   3.79 %   3.69 %   3.81 %   3.94 %
Efficiency ratio(1) 60.26 %   60.35 %   58.75 %   55.57 %   54.12 %
Share Data                  
Closing share price $ 36.13     $ 34.40     $ 46.90     $ 46.30     $ 43.95  
Book value per common share $ 28.52     $ 28.01     $ 27.18     $ 26.80     $ 26.35  
Tangible book value per common share $ 18.34     $ 17.75     $ 16.95     $ 16.55     $ 16.14  
Price / book value 126.68 %   122.81 %   172.55 %   172.76 %   166.79 %
Price / tangible book value 197.00 %   193.80 %   276.70 %   279.74 %   272.35 %
Weighted average diluted shares outstanding 20,271,661     20,321,283     20,438,376     20,413,578     20,450,494  
Shares outstanding, end of period 20,167,729     20,163,816     20,291,416     20,242,893     20,229,896  
Wealth Management Information:                  
Wealth assets under mgmt, administration, supervision and brokerage (2) $ 14,736,512     $ 13,429,544     $ 13,913,265     $ 13,404,723     $ 13,146,926  
Fees for wealth management services $ 10,392     $ 11,017     $ 10,343     $ 10,658     $ 10,308  


  As of or For the Three Months Ended
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Capital Ratios (3)                  
Bryn Mawr Trust Company ("BMTC")                  
Tier I capital to risk weighted assets ("RWA") 11.30 %   11.42 %   11.55 %   11.34 %   11.29 %
Total capital to RWA 11.87 %   11.99 %   12.10 %   11.91 %   11.82 %
Tier I leverage ratio 9.48 %   9.48 %   9.47 %   9.49 %   9.39 %
Tangible equity ratio (1) 9.34 %   8.95 %   9.29 %   9.27 %   9.19 %
Common equity Tier I capital to RWA 11.30 %   11.42 %   11.55 %   11.34 %   11.29 %
                   
Bryn Mawr Bank Corporation ("BMBC")                  
Tier I capital to RWA 10.72 %   10.92 %   10.90 %   10.46 %   10.46 %
Total capital to RWA 14.00 %   14.30 %   14.33 %   13.87 %   13.93 %
Tier I leverage ratio 8.99 %   9.06 %   8.94 %   8.75 %   8.71 %
Tangible equity ratio (1) 8.35 %   8.05 %   8.23 %   8.00 %   7.98 %
Common equity Tier I capital to RWA 10.14 %   10.32 %   10.29 %   9.86 %   9.85 %
                   
Asset Quality Indicators                  
Net loan and lease charge-offs ("NCO"s) $ 2,546     $ 1,620     $ 1,378     $ 1,401     $ 893  
                   
Nonperforming loans and leases ("NPL"s) $ 19,283     $ 12,820     $ 8,990     $ 9,448     $ 7,533  
Other real estate owned ("OREO") 84     417     529     531     300  
Total nonperforming assets ("NPA"s) $ 19,367     $ 13,237     $ 9,519     $ 9,979     $ 7,833  
                   
Nonperforming loans and leases 30 or more days past due $ 8,489     $ 7,765     $ 4,906     $ 6,749     $ 5,775  
Performing loans and leases 30 to 89 days past due 6,432     5,464     9,145     10,378     6,547  
Performing loans and leases 90 or more days past due                  
Total delinquent loans and leases $ 14,921     $ 13,229     $ 14,051     $ 17,127     $ 12,322  
                   
Delinquent loans and leases to total loans and leases 0.42 %   0.39 %   0.42 %   0.50 %   0.37 %
Delinquent performing loans and leases to total loans and leases 0.18 %   0.16 %   0.27 %   0.31 %   0.20 %
NCOs / average loans and leases (annualized) 0.30 %   0.19 %   0.16 %   0.17 %   0.11 %
NPLs / total portfolio loans and leases 0.55 %   0.37 %   0.27 %   0.28 %   0.23 %
NPAs / total loans and leases and OREO 0.55 %   0.39 %   0.28 %   0.29 %   0.24 %
NPAs / total assets 0.42 %   0.28 %   0.22 %   0.23 %   0.18 %
ALLL / NPLs 106.91 %   151.53 %   207.83 %   205.31 %   234.46 %
ALLL / portfolio loans 0.59 %   0.57 %   0.55 %   0.57 %   0.53 %
ALLL for originated loans and leases / Originated loans and leases (1) 0.68 %   0.67 %   0.68 %   0.71 %   0.69 %
(Total ALLL + Loan mark) / Total Gross portfolio loans and leases (1) 1.03 %   1.08 %   1.28 %   1.35 %   1.50 %
                   
Troubled debt restructurings ("TDR"s) included in NPLs $ 4,057     $ 1,217     $ 1,208     $ 1,044     $ 1,125  
TDRs in compliance with modified terms 5,149     9,745     4,316     4,117     5,235  
Total TDRs $ 9,206     $ 10,962     $ 5,524     $ 5,161     $ 6,360  
  1. Non-GAAP measure - see Appendix for Non-GAAP to GAAP reconciliation.
  2. Brokerage assets represent assets held at a registered broker dealer under a clearing agreement.
  3. Capital Ratios for the current quarter are to be considered preliminary until the Call Reports are filed.

Bryn Mawr Bank Corporation
Detailed Balance Sheets (unaudited)
(dollars in thousands)

  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Assets                  
Cash and due from banks $ 13,656     $ 14,099     $ 10,121     $ 7,318     $ 7,804  
Interest-bearing deposits with banks 29,449     34,357     35,233     39,924     24,589  
  Cash and cash equivalents 43,105     48,456     45,354     47,242     32,393  
Investment securities, available for sale 559,983     737,442     528,064     531,075     534,103  
Investment securities, held to maturity 10,457     8,684     8,916     7,838     7,885  
Investment securities, trading 8,189     7,502     8,340     8,175     8,211  
Loans held for sale 2,884     1,749     4,111     4,204     5,522  
Portfolio loans and leases, originated 3,032,270     2,885,251     2,752,160     2,700,815     2,564,827  
Portfolio loans and leases, acquired 491,244     541,903     629,315     688,686     740,968  
  Total portfolio loans and leases 3,523,514     3,427,154     3,381,475     3,389,501     3,305,795  
Less: Allowance for losses on originated loan and leases (20,519 )   (19,329 )   (18,612 )   (19,181 )   (17,570 )
Less: Allowance for losses on acquired loan and leases (97 )   (97 )   (72 )   (217 )   (92 )
  Total allowance for loan and lease losses (20,616 )   (19,426 )   (18,684 )   (19,398 )   (17,662 )
  Net portfolio loans and leases 3,502,898     3,407,728     3,362,791     3,370,103     3,288,133  
Premises and equipment 67,279     65,648     63,281     54,185     54,986  
Operating lease right-of-use assets 43,985                  
Accrued interest receivable 13,123     12,585     13,232     13,115     12,521  
Mortgage servicing rights 4,910     5,047     5,328     5,511     5,706  
Bank owned life insurance 58,138     57,844     57,543     57,243     56,946  
Federal Home Loan Bank ("FHLB") stock 10,526     14,530     14,678     16,678     15,499  
Goodwill 184,012     184,012     183,864     183,162     182,200  
Intangible assets 21,994     23,455     24,301     24,977     25,087  
Other investments 16,526     16,526     16,529     16,774     11,720  
Other assets 83,984     61,277     52,110     53,921     59,464  
  Total assets $ 4,631,993     $ 4,652,485     $ 4,388,442     $ 4,394,203     $ 4,300,376  
                   
Liabilities                  
Deposits                  
  Noninterest-bearing $ 882,310     $ 901,619     $ 834,363     $ 892,386     $ 863,118  
  Interest-bearing 2,755,307     2,697,468     2,522,863     2,466,529     2,452,421  
  Total deposits 3,637,617     3,599,087     3,357,226     3,358,915     3,315,539  
Short-term borrowings 124,214     252,367     226,498     227,059     173,704  
Long-term FHLB advances 55,407     55,374     72,841     87,808     107,784  
Subordinated notes 98,571     98,526     98,482     98,491     98,448  
Jr. subordinated debentures 21,622     21,580     21,538     21,497     21,456  
Operating lease liabilities 48,224                  
Accrued interest payable 8,674     6,652     7,193     5,230     4,814  
Other liabilities 62,557     54,195     53,239     52,700     45,570  
  Total liabilities 4,056,886     4,087,781     3,837,017     3,851,700     3,767,315  
                   
Shareholders' equity                  
Common stock 24,577     24,545     24,533     24,453     24,439  
Paid-in capital in excess of par value 375,655     374,010     373,205     372,227     371,319  
Less: common stock held in treasury, at cost (76,974 )   (75,883 )   (70,437 )   (68,943 )   (68,787 )
Accumulated other comprehensive (loss) income, net of tax (3,278 )   (7,513 )   (13,402 )   (11,191 )   (9,664 )
Retained earnings 255,813     250,230     238,204     226,634     216,438  
  Total Bryn Mawr Bank Corporation shareholders' equity 575,793     565,389     552,103     543,180     533,745  
Noncontrolling interest (686 )   (685 )   (678 )   (677 )   (684 )
  Total shareholders' equity 575,107     564,704     551,425     542,503     533,061  
  Total liabilities and shareholders' equity $ 4,631,993     $ 4,652,485     $ 4,388,442     $ 4,394,203     $ 4,300,376  

Bryn Mawr Bank Corporation
Supplemental Balance Sheet Information (unaudited)
(dollars in thousands)

  Portfolio Loans and Leases as of
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Commercial mortgages $ 1,746,695     $ 1,657,436     $ 1,618,493     $ 1,613,721     $ 1,541,457  
Home equity loans and lines 204,791     207,351     207,806     206,429     211,469  
Residential mortgages 502,379     494,355     467,402     449,060     453,655  
Construction 159,761     181,078     178,493     190,874     202,168  
  Total real estate loans 2,613,626     2,540,220     2,472,194     2,460,084     2,408,749  
Commercial & Industrial 705,701     695,584     722,999     745,306     727,231  
Consumer 47,821     46,814     47,809     51,462     48,423  
Leases 156,366     144,536     138,473     132,649     121,392  
  Total non-real estate loans and leases 909,888     886,934     909,281     929,417     897,046  
  Total portfolio loans and leases $ 3,523,514     $ 3,427,154     $ 3,381,475     $ 3,389,501     $ 3,305,795  


  Nonperforming Loans and Leases as of
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Commercial mortgages $ 5,558     $ 2,568     $ 735     $ 1,011     $ 138  
Home equity loans and lines 6,904     3,616     1,933     2,323     1,949  
Residential mortgages 2,863     3,452     2,770     2,647     2,603  
Construction         291          
  Total nonperforming real estate loans 15,325     9,636     5,729     5,980     4,690  
Commercial & Industrial 2,965     2,101     1,782     1,585     2,499  
Consumer 80     108     117          
Leases 913     975     1,362     1,882     344  
  Total nonperforming non-real estate loans and leases 3,958     3,184     3,261     3,468     2,843  
  Total nonperforming portfolio loans and leases $ 19,283     $ 12,820     $ 8,990     $ 9,448     $ 7,533  


  Net Loan and Lease Charge-Offs (Recoveries) for the Three Months Ended
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Commercial mortgage $ 1,373     $ 249     $ 56     $ 13     $ (3 )
Home equity loans and lines 46     107         199     25  
Residential 329     304     (12 )   (1 )    
Construction (1 )           (1 )   (1 )
  Total net charge-offs of real estate loans 1,747     660     44     210     21  
Commercial & Industrial 391     298     304     467     283  
Consumer 94     147     71     41     48  
Leases 314     515     959     683     541  
  Total net charge-offs of non-real estate loans and leases 799     960     1,334     1,191     872  
  Total net charge-offs $ 2,546     $ 1,620     $ 1,378     $ 1,401     $ 893  


  Investment Securities Available for Sale, at Fair Value
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
U.S. Treasury securities $ 100     $ 200,013     $ 100     $ 100     $ 100  
Obligations of the U.S. Government and agencies 186,746     195,855     190,453     183,256     175,107  
State & political subdivisions - tax-free 8,468     11,162     15,629     17,254     19,746  
State & political subdivisions - taxable 170     170     170     171     171  
Mortgage-backed securities 322,913     289,890     284,421     292,563     303,902  
Collateralized mortgage obligations 40,486     39,252     36,193     36,634     33,980  
Other debt securities 1,100     1,100     1,098     1,097     1,097  
  Total investment securities available for sale, at fair value $ 559,983     $ 737,442     $ 528,064     $ 531,075     $ 534,103  


  Unrealized Gain (Loss) on Investment Securities Available for Sale
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
U.S. Treasury securities $     $ (13 )   $     $     $  
Obligations of the U.S. Government and agencies (1,334 )   (2,749 )   (5,881 )   (4,594 )   (3,756 )
State & political subdivisions - tax-free (5 )   (39 )   (90 )   (57 )   (74 )
State & political subdivisions - taxable     (1 )   (1 )   (1 )   (1 )
Mortgage-backed securities (696 )   (4,186 )   (7,584 )   (6,141 )   (5,169 )
Collateralized mortgage obligations (510 )   (898 )   (1,618 )   (1,443 )   (1,322 )
Other debt securities         (2 )   (3 )   (3 )
  Total unrealized losses on investment securities available for sale $ (2,545 )   $ (7,886 )   $ (15,176 )   $ (12,239 )   $ (10,325 )


  Deposits
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Interest-bearing deposits:                  
  Interest-bearing demand $ 664,683     $ 664,749     $ 578,243     $ 617,258     $ 529,478  
  Money market 961,348     862,644     812,027     814,530     856,072  
  Savings 265,613     247,081     286,266     291,858     308,925  
  Retail time deposits 531,522     542,702     561,123     536,287     523,138  
  Wholesale non-maturity deposits 47,744     55,031     24,040     36,826     63,449  
  Wholesale time deposits 284,397     325,261     261,164     169,770     171,359  
  Total interest-bearing deposits 2,755,307     2,697,468     2,522,863     2,466,529     2,452,421  
  Noninterest-bearing deposits 882,310     901,619     834,363     892,386     863,118  
  Total deposits $ 3,637,617     $ 3,599,087     $ 3,357,226     $ 3,358,915     $ 3,315,539  

Bryn Mawr Bank Corporation
Detailed Income Statements (unaudited)
(dollars in thousands, except per share data)

  For the Three Months Ended
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Interest income:                  
Interest and fees on loans and leases $ 44,837     $ 44,157     $ 42,103     $ 41,689     $ 40,689  
Interest on cash and cash equivalents 132     83     64     64     53  
Interest on investment securities 3,499     3,294     3,066     3,001     2,792  
  Total interest income 48,468     47,534     45,233     44,754     43,534  
Interest expense:                  
Interest on deposits 8,097     7,048     5,533     4,499     3,472  
Interest on short-term borrowings 943     681     1,096     985     630  
Interest on FHLB advances 278     331     394     490     562  
Interest on jr. subordinated debentures 358     342     337     321     288  
Interest on subordinated notes 1,145     1,145     1,144     1,143     1,143  
Total interest expense 10,821     9,547     8,504     7,438     6,095  
  Net interest income 37,647     37,987     36,729     37,316     37,439  
Provision for loan and lease losses (the "Provision") 3,736     2,362     664     3,137     1,030  
  Net interest income after Provision 33,911     35,625     36,065     34,179     36,409  
Noninterest income:                  
Fees for wealth management services 10,392     11,017     10,343     10,658     10,308  
Insurance commissions 1,672     1,459     1,754     1,902     1,693  
Capital markets revenue 2,219     1,367     710     2,105     666  
Service charges on deposits 808     798     726     752     713  
Loan servicing and other fees 609     539     559     475     686  
Net gain on sale of loans 319     1,606     631     528     518  
Net gain on sale of investment securities available for sale                 7  
Net gain (loss) on sale of other real estate owned (24 )   3     5     111     176  
Dividends on FHLB and FRB stocks 411     305     375     510     431  
Other operating income 2,847     1,003     3,171     3,034     4,338  
  Total noninterest income 19,253     18,097     18,274     20,075     19,536  
Noninterest expense:                  
Salaries and wages 20,901     17,921     16,528     16,240     15,982  
Employee benefits 4,166     2,977     3,356     2,877     3,708  
Occupancy and bank premises 3,252     3,135     2,717     2,697     3,050  
Furniture, fixtures and equipment 2,389     2,370     2,070     2,069     1,898  
Advertising 415     540     349     369     461  
Amortization of intangible assets 938     997     891     889     879  
Impairment (recovery) of mortgage servicing rights ("MSRs") 17     101     (23 )   (1 )   (50 )
Due diligence, merger-related and merger integration expenses         389     3,053     4,319  
Professional fees 1,320     1,526     997     932     748  
Pennsylvania bank shares tax 409     374     472     473     473  
Information technology 1,320     1,340     1,155     1,252     1,195  
Other operating expenses 4,597     3,564     4,691     4,986     3,367  
  Total noninterest expense 39,724     34,845     33,592     35,836     36,030  
Income before income taxes 13,440     18,877     20,747     18,418     19,915  
Income tax expense 2,764     1,746     4,066     3,723     4,630  
  Net income $ 10,676     $ 17,131     $ 16,681     $ 14,695     $ 15,285  
Net (loss) income attributable to noncontrolling interest (1 )   (5 )   (1 )   7     (1 )
  Net income attributable to Bryn Mawr Bank Corporation $ 10,677     $ 17,136     $ 16,682     $ 14,688     $ 15,286  
                   
Per share data:                  
Weighted average shares outstanding 20,168,498     20,225,993     20,270,706     20,238,852     20,202,969  
Dilutive common shares 103,163     95,290     167,670     174,726     247,525  
Weighted average diluted shares 20,271,661     20,321,283     20,438,376     20,413,578     20,450,494  
Basic earnings per common share $ 0.53     $ 0.85     $ 0.82     $ 0.73     $ 0.76  
Diluted earnings per common share $ 0.53     $ 0.84     $ 0.82     $ 0.72     $ 0.75  
Dividends paid or accrued per share $ 0.25     $ 0.25     $ 0.25     $ 0.22     $ 0.22  
Effective tax rate 20.57 %   9.25 %   19.60 %   20.21 %   23.25 %

Bryn Mawr Bank Corporation
Tax-Equivalent Net Interest Margin (unaudited)
(dollars in thousands, except per share data)

  For the Three Months Ended
  March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018 March 31, 2018
(dollars in thousands) Average
Balance
Interest
Income/
Expense
Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
                               
Assets:                              
Interest-bearing deposits with other banks $ 32,742   $ 132   1.64 % $ 38,957   $ 83   0.85 % $ 37,467   $ 64   0.68 % $ 37,215   $ 64   0.69 % $ 38,044   $ 53   0.56 %
Investment securities - available for sale:                              
Taxable 543,687   3,419   2.55 % 524,117   3,129   2.37 % 514,360   2,960   2.28 % 514,966   2,888   2.25 % 498,718   2,675   2.18 %
Tax-exempt 9,795   168   6.96 % 13,184   70   2.11 % 16,056   83   2.05 % 18,215   93   2.05 % 20,501   100   1.98 %
Total investment securities - available for sale 553,482   3,587   2.63 % 537,301   3,199   2.36 % 530,416   3,043   2.28 % 533,181   2,981   2.24 % 519,219   2,775   2.17 %
                               
Investment securities - held to maturity 8,804   11   0.51 % 8,761   9   0.41 % 8,378   5   0.24 % 7,866   13   0.66 % 7,913   12   0.62 %
Investment securities - trading 7,629   22   1.17 % 8,203   96   4.64 % 8,204   30   1.45 % 8,202   22   1.08 % 8,339   21   1.02 %
                               
Loans and leases * 3,477,739   44,845   5.23 % 3,399,484   44,274   5.17 % 3,379,699   42,214   4.96 % 3,353,339   41,782   5.00 % 3,291,212   40,754   5.02 %
                               
Total interest-earning assets 4,080,396   48,597   4.83 % 3,992,706   47,661   4.74 % 3,964,164   45,356   4.54 % 3,939,803   44,862   4.57 % 3,864,727   43,615   4.58 %
                               
Cash and due from banks 14,414       13,962       7,587       7,153       10,698      
Less: allowance for loan and lease losses (19,887 )     (18,625 )     (19,467 )     (18,043 )     (17,628 )    
Other assets 470,206       424,957       423,864       415,628       388,383      
                               
Total assets $ 4,545,129       $ 4,413,000       $ 4,376,148       $ 4,344,541       $ 4,246,180      
                               
Liabilities:                              
                               
Interest-bearing deposits:                              
Savings, NOW and market rate deposits $ 1,798,103   $ 3,764   0.85 % $ 1,704,065   $ 2,883   0.67 % $ 1,695,214   $ 2,425   0.57 % $ 1,722,328   $ 2,073   0.48 % $ 1,676,733   $ 1,479   0.36 %
Wholesale deposits 342,696   2,012   2.38 % 346,134   1,986   2.28 % 256,347   1,329   2.06 % 233,714   973   1.67 % 231,289   733   1.29 %
Retail time deposits 533,395   2,321   1.76 % 552,213   2,179   1.57 % 541,652   1,779   1.30 % 533,254   1,453   1.09 % 527,469   1,260   0.97 %
Total interest-bearing deposits 2,674,194   8,097   1.23 % 2,602,412   7,048   1.07 % 2,493,213   5,533   0.88 % 2,489,296   4,499   0.72 % 2,435,491   3,472   0.58 %
                               
Borrowings:                              
Short-term borrowings 157,652   943   2.43 % 128,429   681   2.10 % 208,201   1,096   2.09 % 205,323   985   1.92 % 172,534   630   1.48 %
Long-term FHLB advances 55,385   278   2.04 % 67,363   331   1.95 % 81,460   394   1.92 % 102,023   490   1.93 % 123,920   562   1.84 %
Subordinated notes 98,542   1,145   4.71 % 98,497   1,145   4.61 % 98,457   1,144   4.61 % 98,463   1,143   4.66 % 98,430   1,143   4.71 %
Jr. subordinated debt 21,595   358   6.72 % 21,553   342   6.30 % 21,511   337   6.22 % 21,470   321   6.00 % 21,430   288   5.45 %
Total borrowings 333,174   2,724   3.32 % 315,842   2,499   3.14 % 409,629   2,971   2.88 % 427,279   2,939   2.76 % 416,314   2,623   2.56 %
                               
Total interest-bearing liabilities 3,007,368   10,821   1.46 % 2,918,254   9,547   1.30 % 2,902,842   8,504   1.16 % 2,916,575   7,438   1.02 % 2,851,805   6,095   0.87 %
                               
Noninterest-bearing deposits 871,726       878,047       866,314       841,676       835,476      
Other liabilities 93,949       60,393       59,085       52,389       32,465      
Total noninterest-bearing liabilities 965,675       938,440       925,399       894,065       867,941      
                               
Total liabilities 3,973,043       3,856,694       3,828,241       3,810,640       3,719,746      
                               
Shareholders' equity 572,086       556,306       547,907       533,901       526,434      
                               
Total liabilities and shareholders' equity $ 4,545,129       $ 4,413,000       $ 4,376,148       $ 4,344,541       $ 4,246,180      
                               
Net interest spread     3.37 %     3.44 %     3.38 %     3.55 %     3.71 %
Effect of noninterest-bearing sources     0.38 %     0.35 %     0.31 %     0.26 %     0.23 %
                               
Tax-equivalent net interest margin   $ 37,776   3.75 %   $ 38,114   3.79 %   $ 36,852   3.69 %   $ 37,424   3.81 %   $ 37,520   3.94 %
                               
Tax-equivalent adjustment   $ 129   0.01 %   $ 127   0.01 %   $ 123   0.01 %   $ 108   0.01 %   $ 81   0.01 %
* Average loans and leases include portfolio loans and leases, and loans held for sale. Non-accrual loans are also included in the average loan and leases balances.

Supplemental Information Regarding Accretion of Fair Value Marks

  For the Three Months Ended
  March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018 March 31, 2018
(dollars in thousands) Interest Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
Loans and leases Income $ 1,997   0.23 %   $ 2,492   0.29 %   $ 1,464   0.17 %   $ 1,945   0.23 %   $ 2,702   0.33 %
Retail time deposits Expense (222 ) (0.17 )%   (279 ) (0.20 )%   (311 ) (0.23 )%   (339 ) (0.25 )%   (380 ) (0.29 )%
Long-term FHLB advances Expense 33   0.24 %   34   0.20 %   32   0.16 %   25   0.10 %   15   0.05 %
Jr. subordinated debt Expense 42   0.79 %   42   0.77 %   41   0.76 %   41   0.77 %   40   0.76 %
Net interest income from fair value marks   $ 2,144       $ 2,695       $ 1,702       $ 2,218       $ 3,027    
Purchase accounting effect on tax-equivalent margin     0.21 %     0.27 %     0.17 %     0.23 %     0.32 %

Bryn Mawr Bank Corporation
Appendix - Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Performance Measures (unaudited)
(dollars in thousands, except per share data)

Statement on Non-GAAP Measures: The Corporation believes the presentation of the following non-GAAP financial measures provides useful supplemental information that is essential to an investor’s proper understanding of the results of operations and financial condition of the Corporation. Management uses non-GAAP financial measures in its analysis of the Corporation’s performance. These non-GAAP measures should not be viewed as substitutes for the financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
                   
  As of or For the Three Months Ended
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Reconciliation of Net Income to Net Income (core):                  
Net income attributable to BMBC (a GAAP measure) $ 10,677     $ 17,136     $ 16,682     $ 14,688     $ 15,286  
Less: Tax-effected non-core noninterest income:                  
Gain on sale of investment securities available for sale                 (6 )
Add: Tax-effected non-core noninterest expense items:                  
Due diligence, merger-related and merger integration expenses         307     2,412     3,412  
Voluntary years of service incentive program expenses 3,553                  
Add: Federal income tax expense related to re-measurement of net deferred tax asset due to tax reform legislation     31     151     (69 )   590  
Net income (core) (a non-GAAP measure) $ 14,230     $ 17,167     $ 17,140     $ 17,031     $ 19,282  
                   
Calculation of Basic and Diluted Earnings per Common Share (core):                  
Weighted average common shares outstanding 20,168,498     20,225,993     20,270,706     20,238,852     20,202,969  
Dilutive common shares 103,163     95,290     167,670     174,726     247,525  
Weighted average diluted shares 20,271,661     20,321,283     20,438,376     20,413,578     20,450,494  
Basic earnings per common share (core) (a non-GAAP measure) $ 0.71     $ 0.85     $ 0.85     $ 0.84     $ 0.95  
Diluted earnings per common share (core) (a non-GAAP measure) $ 0.70     $ 0.84     $ 0.84     $ 0.83     $ 0.94  
                   
Calculation of Return on Average Tangible Equity:                  
Net income attributable to BMBC (a GAAP measure) $ 10,677     $ 17,136     $ 16,682     $ 14,688     $ 15,286  
Add: Tax-effected amortization and impairment of intangible assets 741     787     705     702     694  
Net tangible income (numerator) $ 11,418     $ 17,923     $ 17,387     $ 15,390     $ 15,980  
                   
Average shareholders' equity $ 572,086     $ 556,306     $ 547,907     $ 533,901     $ 526,434  
Less: Average Noncontrolling interest 685     681     678     685     683  
Less: Average goodwill and intangible assets (206,716 )   (207,893 )   (207,880 )   (208,039 )   (205,529 )
Net average tangible equity (denominator) $ 366,055     $ 349,094     $ 340,705     $ 326,547     $ 321,588  
                   
Return on tangible equity (a non-GAAP measure) 12.65 %   20.37 %   20.25 %   18.90 %   20.15 %
                   
Calculation of Return on Average Tangible Equity (core):                  
Net income (core) (a non-GAAP measure) $ 14,230     $ 17,167     $ 17,140     $ 17,031     $ 19,282  
Add: Tax-effected amortization and impairment of intangible assets 741     787     705     702     694  
Net tangible income (core) (numerator) $ 14,971     $ 17,954     $ 17,845     $ 17,733     $ 19,976  
                   
Average shareholders' equity $ 572,086     $ 556,306     $ 547,907     $ 533,901     $ 526,434  
Less: Average Noncontrolling interest 685     681     678     685     683  
Less: Average goodwill and intangible assets (206,716 )   (207,893 )   (207,880 )   (208,039 )   (205,529 )
Net average tangible equity (denominator) $ 366,055     $ 349,094     $ 340,705     $ 326,547     $ 321,588  
                   
Return on tangible equity (core) (a non-GAAP measure) 16.59 %   20.40 %   20.78 %   21.78 %   25.19 %


Statement on Non-GAAP Measures: The Corporation believes the presentation of the following non-GAAP financial measures provides useful supplemental information that is essential to an investor’s proper understanding of the results of operations and financial condition of the Corporation. Management uses non-GAAP financial measures in its analysis of the Corporation’s performance. These non-GAAP measures should not be viewed as substitutes for the financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
                   
  As of or For the Three Months Ended
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Calculation of Tangible Equity Ratio (BMBC):                  
Total shareholders' equity $ 575,107     $ 564,704     $ 551,425     $ 542,503     $ 533,061  
Less: Noncontrolling interest 686     685     678     677     684  
Less: Goodwill and intangible assets (206,006 )   (207,467 )   (208,165 )   (208,139 )   (207,287 )
Net tangible equity (numerator) $ 369,787     $ 357,922     $ 343,938     $ 335,041     $ 326,458  
                   
Total assets $ 4,631,993     $ 4,652,485     $ 4,388,442     $ 4,394,203     $ 4,300,376  
Less: Goodwill and intangible assets (206,006 )   (207,467 )   (208,165 )   (208,139 )   (207,287 )
Tangible assets (denominator) $ 4,425,987     $ 4,445,018     $ 4,180,277     $ 4,186,064     $ 4,093,089  
                   
Tangible equity ratio (BMBC)(1) 8.35 %   8.05 %   8.23 %   8.00 %   7.98 %
                   
Calculation of Tangible Equity Ratio (BMTC):                  
Total shareholders' equity $ 605,985     $ 591,695     $ 582,698     $ 582,354     $ 569,670  
Less: Noncontrolling interest 686     685     678     677     684  
Less: Goodwill and intangible assets (193,329 )   (194,715 )   (195,337 )   (195,245 )   (194,316 )
Net tangible equity (numerator) $ 413,342     $ 397,665     $ 388,039     $ 387,786     $ 376,038  
                   
Total assets $ 4,616,724     $ 4,637,481     $ 4,372,590     $ 4,378,508     $ 4,284,334  
Less: Goodwill and intangible assets (193,329 )   (194,715 )   (195,337 )   (195,245 )   (194,316 )
Tangible assets (denominator) $ 4,423,395     $ 4,442,766     $ 4,177,253     $ 4,183,263     $ 4,090,018  
                   
Tangible equity ratio (BMTC)(1) 9.34 %   8.95 %   9.29 %   9.27 %   9.19 %
                   
Calculation of Return on Average Assets (core)                  
Return on average assets (GAAP) 0.95 %   1.54 %   1.51 %   1.36 %   1.46 %
Effect of adjustment to GAAP net income to core net income 0.32 %   %   0.04 %   0.21 %   0.38 %
Return on average assets (core) 1.27 %   1.54 %   1.55 %   1.57 %   1.84 %
                   
Calculation of Return on Average Equity (core)                  
Return on average equity (GAAP) 7.57 %   12.22 %   12.08 %   11.03 %   11.78 %
Effect of adjustment to GAAP net income to core net income 2.52 %   0.02 %   0.33 %   1.76 %   3.07 %
Return on average equity (core) 10.09 %   12.24 %   12.41 %   12.79 %   14.85 %
                   
Calculation of Tax-equivalent net interest margin adjusting for the impact of purchase accounting                  
Tax-equivalent net interest margin 3.75 %   3.79 %   3.69 %   3.81 %   3.94 %
Effect of fair value marks 0.21 %   0.27 %   0.17 %   0.23 %   0.32 %
Tax-equivalent net interest margin adjusting for the impact of purchase accounting 3.54 %   3.52 %   3.52 %   3.58 %   3.62 %
  1. Capital Ratios for the current quarter are to be considered preliminary until the Call Reports are filed.
Statement on Non-GAAP Measures: The Corporation believes the presentation of the following non-GAAP financial measures provides useful supplemental information that is essential to an investor’s proper understanding of the results of operations and financial condition of the Corporation. Management uses non-GAAP financial measures in its analysis of the Corporation’s performance. These non-GAAP measures should not be viewed as substitutes for the financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
                   
  As of or For the Three Months Ended
  March 31,
2019
  December 31,
2018
  September 30,
2018
  June 30,
2018
  March 31,
2018
Calculation of Tax-equivalent net interest income adjusting for the impact of purchase accounting                  
Tax-equivalent net interest income $ 37,776     $ 38,114     $ 36,852     $ 37,424     $ 37,520  
Effect of fair value marks 2,144     2,695     1,702     2,218     3,027  
Tax-equivalent net interest income adjusting for the impact of purchase accounting $ 35,632     $ 35,419     $ 35,150     $ 35,206     $ 34,493  
                   
Calculation of Efficiency Ratio:                  
Noninterest expense $ 39,724     $ 34,845     $ 33,592     $ 35,836     $ 36,030  
Less: certain noninterest expense items*:                  
Amortization of intangibles (938 )   (997 )   (891 )   (889 )   (879 )
Due diligence, merger-related and merger integration expenses         (389 )   (3,053 )   (4,319 )
Voluntary years of service incentive program expenses (4,498 )                
Noninterest expense (adjusted) (numerator) $ 34,288     $ 33,848     $ 32,312     $ 31,894     $ 30,832  
                   
Noninterest income $ 19,253     $ 18,097     $ 18,274     $ 20,075     $ 19,536  
Less: non-core noninterest income items:                  
Gain on sale of investment securities available for sale                 (7 )
Noninterest income (core) $ 19,253     $ 18,097     $ 18,274     $ 20,075     $ 19,529  
Net interest income 37,647     37,987     36,729     37,316     37,439  
Noninterest income (core) and net interest income (denominator) $ 56,900     $ 56,084     $ 55,003     $ 57,391     $ 56,968  
                   
Efficiency ratio 60.26 %   60.35 %   58.75 %   55.57 %   54.12 %
                   
Supplemental Loan and Allowance Information Used to Calculate Non-GAAP Measures                  
Total Allowance $ 20,616     $ 19,426     $ 18,684     $ 19,398     $ 17,662  
Less: Allowance on acquired loans 97     97     72     217     92  
Allowance on originated loans and leases $ 20,519     $ 19,329     $ 18,612     $ 19,181     $ 17,570  
                   
Total Allowance $ 20,616     $ 19,426     $ 18,684     $ 19,398     $ 17,662  
Loan mark on acquired loans 15,841     17,822     24,964     26,705     32,260  
Total Allowance + Loan mark $ 36,457     $ 37,248     $ 43,648     $ 46,103     $ 49,922  
                   
Total Portfolio loans and leases $ 3,523,514     $ 3,427,154     $ 3,381,475     $ 3,389,501     $ 3,305,795  
Less: Originated loans and leases 3,032,270     2,885,251     2,752,160     2,700,815     2,564,827  
Net acquired loans $ 491,244     $ 541,903     $ 629,315     $ 688,686     $ 740,968  
Add: Loan mark on acquired loans 15,841     17,822     24,964     26,705     32,260  
Gross acquired loans (excludes loan mark) $ 507,085     $ 559,725     $ 654,279     $ 715,391     $ 773,228  
Originated loans and leases 3,032,270     2,885,251     2,752,160     2,700,815     2,564,827  
Total Gross portfolio loans and leases $ 3,539,355     $ 3,444,976     $ 3,406,439     $ 3,416,206     $ 3,338,055  
  • In calculating the Corporation's efficiency ratio, which is used by Management to identify the cost of generating each dollar of core revenue, certain non-core income and expense items as well as the amortization of intangible assets, are excluded.

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