• ConnectOne Bancorp, Inc. Reports First Quarter 2022 Results; Tangible Book Value Per Share Increases 2%; Declares 19% Increase in Common Dividend

    المصدر: Nasdaq GlobeNewswire / 28 أبريل 2022 06:00:03   America/Chicago

    ENGLEWOOD CLIFFS, N.J., April 28, 2022 (GLOBE NEWSWIRE) -- ConnectOne Bancorp, Inc. (Nasdaq: CNOB) (the “Company” or “ConnectOne”), parent company of ConnectOne Bank (the “Bank”), today reported net income available to common stockholders of $29.9 million for the first quarter of 2022, compared with $31.3 million for the fourth quarter of 2021 and $33.0 million for the first quarter of 2021. Diluted earnings per share were $0.75 for the first quarter of 2022 compared with $0.79 for the fourth quarter of 2021 and $0.82 for the first quarter of 2021. The $1.4 million decrease in net income available to common stockholders and $0.04 decrease in diluted earnings per share versus the fourth quarter of 2021 were primarily due to a $1.1 million increase in noninterest expenses, a $0.7 million decrease in noninterest income, and a $0.6 million increase to provision for credit losses, partially offset by a $1.0 million decrease in income tax expenses. The $3.1 million decrease in net income available to common stockholders and $0.07 decrease in diluted earnings per share versus the first quarter of 2021 were due to a $7.2 million increase to provision for credit losses, a $2.7 million increase in noninterest expenses, $1.5 million in preferred dividends, a $0.4 million decrease in noninterest income and a $0.5 million increase in income tax expenses, partially offset by a $9.2 million increase in net interest income.

    Pre-tax, pre-provision net revenue (“PPNR”) as a percent of average assets was 2.17%, 2.28% and 2.06% for the quarters ending March 31, 2022, December 31, 2021 and March 31, 2021, respectively.

    Frank Sorrentino, ConnectOne’s Chairman and Chief Executive Officer stated, “ConnectOne had a solid start to 2022. We delivered another quarter of strong operating performance along with significant organic growth and best-in-class efficiency, while also investing in our infrastructure to support future growth and performance. Our efficiency ratio remained below 40% at 38.7%, our PPNR as a percent of average assets remained above 2%, and our return on tangible common equity exceeded 15%, while our net interest margin remained at a near record level. Tangible book value per share increased by 2.0% for the quarter to $20.51.

    “Operationally, we’re using the full range of the Company’s banking expertise to enhance client relationships. Loan demand remained strong with annualized core loan growth increasing over 10% sequentially, matched with annualized deposit growth in excess of 14%. We ended the quarter with a strong pipeline, reflecting continued momentum and solid prospects among our clients across all the markets we serve. That also reflects our expansion into new markets which are a natural progression for us, such as Florida where we are gaining nice traction.” Mr. Sorrentino added, “We continue to leverage our technological foundation by investing in infrastructure, new verticals, communication tools and digital channels to remain well-positioned for continued growth.”

    “We remain committed to strategically allocating capital to investments that we believe can enhance value for our shareholders. We also announced today yet another increase to our common dividend, the third increase since the start of 2021 -- reflecting ConnectOne’s growing capital base, our strong operating performance and our favorable outlook.” Mr. Sorrentino added, “Looking ahead, we remain confident in our ability to increase our market presence and deliver continued organic growth. Our margins and efficiency are expected to remain among the best in the industry and, even with investments to support our growing businesses, we aim to grow revenues faster than expenses. We’re excited about what the future holds for ConnectOne, we are very optimistic about performance in 2022 and we are well positioned to pursue attractive opportunities to expand our valuable franchise.”

    Dividend Declarations

    The Company announced that its Board of Directors declared an increased cash dividend on its common stock and a quarterly cash dividend on its preferred stock.

    A cash dividend on common stock of $0.155 per share, reflecting a 19.2% sequential increase and a 40.9% increase versus one year ago, will be paid on June 1, 2022 to common stockholders of record on May 16, 2022.   A dividend of $0.328125 per share for every depositary share, representing a 1/40th interest in the Company’s 5.25% Fixed Rate Reset Non-Cumulative Perpetual Preferred Stock, Series A, will also be paid on June 1, 2022 to preferred stockholders of record on May 16, 2022.

    Operating Results

    Fully taxable equivalent net interest income for the first quarter of 2022 was $70.8 million, virtually unchanged from the fourth quarter of 2021. Average interest-earning assets increased by $244.9 million, or 3.3%, from the fourth quarter of 2021 resulting primarily from a 2.3% increase in average loans. Partially offsetting the benefit from increased average interest-earnings assets was a modest contraction in the net interest margin of 4 basis points to 3.71% from 3.75%. The net interest margin contraction was primarily a result of a 6 basis-point decline in the yield on loans. Excluding purchase accounting adjustments, the adjusted net interest margin was 3.64% for the first quarter of 2022 and 3.66% for the fourth quarter of 2021. Included in interest income in the first quarter of 2022 and fourth quarter of 2021 was the accretion of Paycheck Protection Program (“PPP”) fee income of $2.0 million and $1.5 million, respectively. Remaining deferred and unrecognized PPP fees were $2.6 million as of March 31, 2022.

    Fully taxable equivalent net interest income for the first quarter of 2022 increased by $9.3 million, or 15.0%, from the first quarter of 2021. The increase from the first quarter of 2021 resulted primarily from a 10.1% increase in average loans and a 15 basis-point widening of the net interest margin to 3.71% from 3.56%. The widening of the net interest margin resulted from a 27 basis-point reduction in the cost of interest-bearing liabilities, partially offset by an 8 basis-point reduction in the yield on average interest-earning assets.

    Noninterest income was $3.1 million in the first quarter of 2022, $3.8 million in the fourth quarter of 2021 and $3.4 million in the first quarter of 2021.   Included in noninterest income were net losses on equity securities of $0.6 million, $0.1 million and $0.2 million for the first quarter 2022, fourth quarter 2021 and first quarter 2021, respectively, and a $0.7 million gain on the sale of branches in the first quarter 2021.   Excluding the aforementioned items, adjusted noninterest income was $3.7 million, $3.9 million and $2.9 million for the first quarter 2022, fourth quarter 2021 and first quarter 2021, respectively. The $0.3 million decrease in adjusted noninterest income for the current quarter versus the sequential fourth quarter 2021 was primarily due to a decrease in net gains on sale of loans held-for-sale, partially offset by increased BoeFly income. The $0.7 million increase in adjusted noninterest income for the current quarter versus the first quarter 2021 was primarily due to increases in deposit, loan and other income of $0.4 million, BoeFly income of $0.2 million and BOLI income of $0.1 million.

    Noninterest expenses totaled $29.2 million for the first quarter of 2022, $28.1 million for the fourth quarter of 2021 and $26.5 million for the first quarter of 2021. The increase in noninterest expenses of $1.1 million from the fourth quarter of 2021 was primarily attributable to an increase in salaries and employee benefits of $2.2 million and a $0.7 million in increase acquisition expenses related to BoeFly, partially offset by decreases in occupancy and equipment of $0.8 million, which included a $0.9 million favorable dissolution of a merger lease obligation, other expense of $0.3 million, information technology and communications of $0.2 million, professional and consulting of $0.2 million, and marketing and advertising of $0.1 million.   The increase in noninterest expenses of $2.7 million from the first quarter of 2021 was primarily attributable to increases in salaries and employee benefits of $3.1 million, the aforementioned BoeFly expense of $0.7 million, and other expenses of $0.6 million, and information technology and communications of $0.3 million, partially offset by decreases in occupancy and equipment of $1.5 million, including the aforementioned favorable dissolution of merger lease obligation, FDIC insurance of $0.3 million and professional and consulting of $0.2 million. The increase in salaries and employee benefits from the prior sequential quarter and prior year quarter was attributable to new hires, seasonal increases in payroll taxes, as well as higher incentive-based, stock compensation expense.

    Income tax expense was $11.4 million for the first quarter of 2022, $12.3 million for the fourth quarter of 2021 and $10.9 million for the first quarter of 2021. The effective tax rates for the first quarter of 2022, fourth quarter of 2021 and first quarter of 2021 were 26.6%, 27.1% and 24.8%, respectively.

    Asset Quality

    The provision for (reversal of) credit losses was $1.5 million for the first quarter of 2022, $0.8 million for the fourth quarter of 2021 and $(5.8) million for the first quarter of 2021. The provision for credit losses during the first quarter of 2022 and the fourth quarter of 2021 reflected strong organic loan growth and stabilizing macroeconomic forecasts.   The reversal of provision for credit losses during the first quarter of 2021 was the result of an improved macroeconomic forecast when compared to January 1, 2021, the date of CECL implementation.

    Nonperforming assets, which includes nonaccrual loans and other real estate owned, were $59.7 million as of March 31, 2022, $61.7 million as of December 31, 2021 and $60.9 million as of March 31, 2021.   Nonaccrual loans were $59.4 million as of March 31, 2022, $61.7 million as of December 31, 2021 and $60.9 million as of March 31, 2021. Nonperforming assets as a percentage of total assets were 0.72% as of March 31, 2022, 0.76% as of December 31, 2021 and 0.82% as of March 31, 2021. The ratio of nonaccrual loans to loans receivable was 0.85%, 0.90% and 0.97%, as of March 31, 2022, December 31, 2021 and March 31, 2021, respectively. The annualized net loan charge-offs ratio was 0.01% for the first quarter of 2022, 0.01% for the fourth quarter of 2021 and 0.00% for the first quarter of 2021. The allowance for credit losses represented 1.15%, 1.15%, and 1.28% of loans receivable as of March 31, 2022, December 31, 2021 and March 31, 2021, respectively. Excluding PPP loans, the allowance for credit losses represented 1.16%, 1.17%, and 1.40% of loans receivable as of March 31, 2022, December 31, 2021 and March 31, 2021, respectively. The allowance for credit losses as a percentage of nonaccrual loans was 134.8% as of March 31, 2022, 127.7% as of December 31, 2021 and 132.2% as of March 31, 2021.

    Selected Balance Sheet Items

    The Company’s total assets were $8.3 billion as of March 31, 2022, an increase of $204.8 million from December 31, 2021.  Loans receivable were $7.0 billion, an increase of $151.0 million from December 31, 2021. The increase in loans receivable was attributable to higher, organic, loan originations.

    The Company’s total stockholders’ equity was $1.1 billion as of March 31, 2022, an increase of $14.3 million from December 31, 2021. The increase in retained earnings of $24.7 million was the primary reason for the overall increase in stockholders’ equity, in addition to an increase in additional paid-in capital of $1.2 million, partially offset by a decrease in accumulated other comprehensive income of $6.9 million, reflecting the after-tax decline in the fair value of investment securities net of unrealized hedge gains recorded in other assets, and an increase in treasury stock of $4.8 million. As of March 31, 2022, the Company’s tangible common equity ratio and tangible book value per share were 9.99% and $20.51, respectively. As of December 31, 2021, the tangible common equity ratio and tangible book value per share were 10.06% and $20.12, respectively. Total goodwill and other intangible assets were approximately $216.9 million as of March 31, 2022 and $217.4 million as of December 31, 2021.

    Share Repurchase Program

    During the first quarter of 2022, the Company repurchased 144,793 shares of common stock leaving approximately 2.1 million shares remaining authorized for repurchase under the current Board approved repurchase programs. The Company may repurchase shares from time-to-time in the open market, in privately negotiated stock purchases or pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities and Exchange Commission and applicable federal securities laws. The share repurchase plans do not obligate the Company to acquire any particular amount of common stock, and they may be modified or suspended at any time at the Company's discretion. 

    Use of Non-GAAP Financial Measures

    In addition to the results presented in accordance with Generally Accepted Accounting Principles ("GAAP"), ConnectOne routinely supplements its evaluation with an analysis of certain non-GAAP measures. ConnectOne believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors in understanding our operating performance and trends. These non-GAAP measures have inherent limitations and are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for an analysis of results reported under GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Reconciliations of non-GAAP financial measures disclosed in this earnings release to the comparable GAAP measures are provided in the accompanying tables.

    First Quarter 2022 Results Conference Call

    Management will also host a conference call and audio webcast at 10:00 a.m. ET on April 28, 2022 to review the Company's financial performance and operating results. The conference call dial-in number is 201-689-8471, access code 13728265. Please dial in at least five minutes before the start of the call to register. An audio webcast of the conference call will be available to the public, on a listen-only basis, via the "Investor Relations" link on the Company's website https://www.ConnectOneBank.com or at http://ir.connectonebank.com.

    A replay of the conference call will be available beginning at approximately 1:00 p.m. ET on Thursday, April 28, 2022 and ending on Thursday, May 5, 2022 by dialing 412-317-6671, access code 13728265. An online archive of the webcast will be available following the completion of the conference call at https://www.connectonebank.com or at http://ir.connectonebank.com.

    About ConnectOne Bancorp, Inc.

    ConnectOne Bancorp, Inc., is a modern financial services company that operates, through its subsidiary, ConnectOne Bank, and its fintech subsidiary, BoeFly. ConnectOne Bank is a high-performing commercial bank offering a full suite of banking & lending products and services that focus on small to middle-market businesses. BoeFly is a fintech marketplace that connects borrowers in the franchise space with funding solutions through a network of partner banks. ConnectOne Bancorp, Inc. is traded on the Nasdaq Global Market under the trading symbol "CNOB," and information about ConnectOne may be found at https://www.connectonebank.com.

    Forward-Looking Statements

    This news release contains certain forward-looking statements which are based on certain assumptions and describe future plans, strategies and expectations of the Company. These forward-looking statements are generally identified by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project," or similar expressions. The Company's ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations of the Company and its subsidiaries include, but are not limited to, those factors set forth in Item 1A – Risk Factors of the Company’s Annual Report on Form 10-K, as filed with the Securities Exchange Commission, as supplemented by the Company’s subsequent filings with the Securities and Exchange Commission, and changes in interest rates, general economic conditions, legislative/regulatory changes, monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board, the quality or composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in the Company's market area, changes in accounting principles and guidelines and the impact of the COVID-19 pandemic on the Company, its employees and operations, and its customers. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

    Investor Contact:

    William S. Burns
    Senior Executive VP & CFO
    201.816.4474: bburns@cnob.com

    Media Contact:
    Sutton Resler, MWW
    571.236.4966: sresler@mww.com   


    CONNECTONE BANCORP, INC. AND SUBSIDIARIES      
    CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION     
    (in thousands)      
           
     March 31, December 31, March 31, 
      2022   2021   2021  
     (unaudited)   (unaudited) 
    ASSETS      
    Cash and due from banks$61,849  $54,352  $48,250  
    Interest-bearing deposits with banks 249,695   211,184   211,842  
         Cash and cash equivalents 311,544   265,536   260,092  
           
    Investment securities 512,030   534,507   442,023  
    Equity securities 13,198   13,794   13,200  
           
    Loans held-for-sale 2,742   250   6,900  
           
    Loans receivable 6,979,595   6,828,622   6,277,191  
    Less: Allowance for credit losses - loans 80,070   78,773   80,568  
         Net loans receivable 6,899,525   6,749,849   6,196,623  
           
    Investment in restricted stock, at cost 25,254   27,826   22,483  
    Bank premises and equipment, net 28,779   29,032   29,296  
    Accrued interest receivable 34,081   34,152   35,249  
    Bank owned life insurance 196,937   195,731   167,024  
    Right of use operating lease assets 10,400   11,017   13,469  
    Other real estate owned 316   -   -  
    Goodwill 208,372   208,372   208,372  
    Core deposit intangibles 8,564   8,997   10,470  
    Other assets 82,559   50,417   44,438  
         Total assets$8,334,301  $8,129,480  $7,449,639  
           
    LIABILITIES      
    Deposits:      
         Noninterest-bearing$1,631,292  $1,617,049  $1,384,961  
         Interest-bearing 4,929,113   4,715,904   4,566,373  
              Total deposits 6,560,405   6,332,953   5,951,334  
    Borrowings 412,170   468,193   359,710  
    Subordinated debentures, net 153,027   152,951   152,724  
    Operating lease liabilities 11,773   12,417   15,260  
    Other liabilities 58,407   38,754   34,974  
         Total liabilities 7,195,782   7,005,268   6,514,002  
           
    COMMITMENTS AND CONTINGENCIES      
           
    STOCKHOLDERS' EQUITY      
    Preferred stock 110,927   110,927   -  
    Common stock 586,946   586,946   586,946  
    Additional paid-in capital 28,484   27,246   23,621  
    Retained earnings 464,889   440,169   358,441  
    Treasury stock (44,458)  (39,672)  (32,682) 
    Accumulated other comprehensive loss (8,269)  (1,404)  (689) 
       Total stockholders' equity 1,138,519   1,124,212   935,637  
       Total liabilities and stockholders' equity$8,334,301  $8,129,480  $7,449,639  
           



    CONNECTONE BANCORP, INC. AND SUBSIDIARIES      
    CONSOLIDATED STATEMENTS OF INCOME      
    (dollars in thousands, except for per share data)      
           
     Three Months Ended 
     03/31/22 12/31/21 03/31/21 
    Interest income      
         Interest and fees on loans$76,025  $76,891  $70,462  
         Interest and dividends on investment securities:      
             Taxable 1,873   1,265   1,088  
             Tax-exempt 709   518   766  
             Dividends 214   207   256  
         Interest on federal funds sold and other short-term investments 120   159   49  
              Total interest income 78,941   79,040   72,621  
    Interest expense      
         Deposits 5,010   5,281   7,585  
         Borrowings 3,573   3,298   3,873  
              Total interest expense 8,583   8,579   11,458  
           
    Net interest income 70,358   70,461   61,163  
        Provision for (reversal of) credit losses 1,450   815   (5,766) 
    Net interest income after provision for credit losses 68,908   69,646   66,929  
           
    Noninterest income      
         Deposit, loan and other income 1,743   1,525   1,168  
         Income on bank owned life insurance 1,206   1,244   1,064  
         Net gains on sale of loans held-for-sale 701   1,139   707  
         Gain on sale of branches -   -   674  
         Net losses on equity securities (596)  (131)  (187) 
              Total noninterest income 3,054   3,777   3,426  
           
    Noninterest expenses      
         Salaries and employee benefits 18,640   16,483   15,565  
         Occupancy and equipment 1,929   2,762   3,404  
         FDIC insurance 606   625   935  
         Professional and consulting 1,792   1,996   1,956  
         Marketing and advertising 351   454   241  
         Information technology and communications 2,866   3,058   2,525  
         Amortization of core deposit intangible 433   483   507  
         Increase in value of acquisition price 683   -   -  
         Other expenses 1,930   2,223   1,352  
              Total noninterest expenses 29,230   28,084   26,485  
           
    Income before income tax expense 42,732   45,339   43,870  
         Income tax expense 11,351   12,301   10,871  
    Net income 31,381   33,038   32,999  
         Preferred dividends 1,509   1,717   -  
    Net income available to common stockholders$29,872  $31,321  $32,999  
           
    Earnings per common share:      
         Basic$0.76  $0.79  $0.83  
         Diluted 0.75   0.79   0.82  
           



    ConnectOne's management believes that the supplemental financial information, including non-GAAP measures provided below, is useful to investors. The non-GAAP measures should not be viewed as a substitute for financial results determined in accordance with GAAP, and are not necessarily comparable to non-GAAP financial measures presented by other companies.
              
    CONNECTONE BANCORP, INC.         
    SUPPLEMENTAL GAAP AND NON-GAAP FINANCIAL MEASURES        
              
     As of
     Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31,
      2022   2021   2021   2021   2021 
    Selected Financial Data(dollars in thousands)
    Total assets$8,334,301  $8,129,480  $7,949,514  $7,710,082  $7,449,639 
    Loans receivable:         
      Commercial$1,161,867  $1,163,442  $1,116,535  $1,046,965  $1,071,418 
      Paycheck Protection Program ("PPP") loans 54,301   93,057   177,829   326,788   522,340 
      Commercial real estate 2,516,065   2,446,807   2,354,209   2,252,484   2,127,807 
      Multifamily 2,465,337   2,337,712   2,113,541   1,914,978   1,698,331 
      Commercial construction 539,058   540,178   552,896   587,121   565,872 
      Residential 250,205   255,269   270,793   286,907   306,376 
      Consumer 1,140   1,886   2,093   6,355   3,364 
      Gross loans 6,987,973   6,838,351   6,587,896   6,421,598   6,295,508 
    Unearned net origination fees (8,378)  (9,729)  (11,457)  (13,694)  (18,317)
       Loans receivable 6,979,595   6,828,622   6,576,439   6,407,904   6,277,191 
       Loans held-for-sale 2,742   250   5,596   6,159   6,900 
    Total loans$6,982,337  $6,828,872  $6,582,035  $6,414,063  $6,284,091 
              
    Investment and equity securities$525,228  $548,301  $476,584  $472,156  $455,223 
    Goodwill and other intangible assets 216,936   217,369   217,852   218,335   218,842 
    Deposits:         
      Noninterest-bearing demand$1,631,292  $1,617,049  $1,500,754  $1,485,952  $1,384,961 
      Time deposits 1,065,814   1,150,109   1,221,911   1,301,807   1,356,599 
      Other interest-bearing deposits 3,863,299   3,565,795   3,675,673   3,404,754   3,209,774 
    Total deposits$6,560,405  $6,332,953  $6,398,338  $6,192,513  $5,951,334 
              
    Borrowings$412,170  $468,193  $253,225  $353,462  $359,710 
    Subordinated debentures (net of debt issuance costs) 153,027   152,951   152,875   152,800   152,724 
    Total stockholders' equity 1,138,519   1,124,212   1,098,433   964,960   935,637 
              
    Quarterly Average Balances         
    Total assets$8,263,382  $8,027,169  $7,837,997  $7,566,676  $7,500,034 
    Loans receivable:         
      Commercial (including PPP loans)$1,231,703  $1,278,048  $1,296,066  $1,485,918  $1,531,790 
      Commercial real estate (including multifamily) 4,850,349   4,625,371   4,312,092   3,925,497   3,805,856 
      Commercial construction 541,642   547,038   572,920   553,396   595,466 
      Residential 253,589   268,112   279,063   293,633   316,233 
      Consumer 3,682   4,938   2,649   3,148   2,540 
      Gross loans 6,880,965   6,723,507   6,462,790   6,261,592   6,251,885 
    Unearned net origination fees (9,870)  (10,873)  (13,064)  (13,076)  (13,163)
       Loans receivable 6,871,095   6,712,634   6,449,726   6,248,516   6,238,722 
       Loans held-for-sale 382   5,051   6,226   3,696   4,237 
    Total loans$6,871,477  $6,717,685  $6,455,952  $6,252,212  $6,242,959 
              
    Investment and equity securities$536,090  $481,276  $465,103  $450,543  $481,082 
    Goodwill and other intangible assets 217,219   217,685   218,170   218,662   219,171 
    Deposits:         
      Noninterest-bearing demand$1,547,055  $1,537,316  $1,495,456  $1,432,707  $1,348,585 
      Time deposits 1,124,614   1,204,374   1,252,818   1,324,510   1,422,295 
      Other interest-bearing deposits 3,851,558   3,672,311   3,582,261   3,320,400   3,225,751 
    Total deposits$6,523,227  $6,414,001  $6,330,535  $6,077,617  $5,996,631 
              
    Borrowings$404,907  $292,847  $276,183  $331,633  $375,511 
    Subordinated debentures (net of debt issuance costs) 152,977   152,902   152,825   152,750   154,341 
    Total stockholders' equity 1,131,968   1,113,524   1,032,191   952,019   928,041 
              
     Three Months Ended
     Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31,
      2022   2021   2021   2021   2021 
     (dollars in thousands, except for per share data)
    Net interest income$70,358  $70,461  $68,245  $63,009  $61,163 
     Provision for (reversal of) credit losses 1,450   815   1,100   (1,649)  (5,766)
    Net interest income after provision for credit losses 68,908   69,646   67,145   64,658   66,929 
    Noninterest income         
    Deposit, loan and other income 1,743   1,525   1,702   2,222   1,168 
    Income on bank owned life insurance 1,206   1,244   1,278   1,185   1,064 
    Net gains on sale of loans held-for-sale 701   1,139   1,114   847   707 
    Gain on sale of branches -   -   -   -   674 
    Net (losses) gains on equity securities (596)  (131)  (78)  23   (187)
           Total noninterest income 3,054   3,777   4,016   4,472   3,426 
    Noninterest expenses         
     Salaries and employee benefits 18,640   16,483   16,740   15,284   15,565 
     Occupancy and equipment 1,929   2,762   2,656   2,916   3,404 
     FDIC insurance 606   625   525   580   935 
     Professional and consulting 1,792   1,996   2,217   2,117   1,956 
     Marketing and advertising 351   454   345   278   241 
    Information technology and communications 2,866   3,058   3,048   2,636   2,525 
     Amortization of core deposit intangible 433   483   483   508   507 
     Increase in value of acquisition price 683   -   -   -   - 
     Other expenses 1,930   2,223   2,169   1,940   1,352 
           Total noninterest expenses 29,230   28,084   28,183   26,259   26,485 
              
    Income before income tax expense 42,732   45,339   42,978   42,871   43,870 
     Income tax expense 11,351   12,301   10,881   10,652   10,871 
    Net income 31,381  $33,038  $32,097  $32,219  $32,999 
     Preferred dividends 1,509   1,717   -   -   - 
    Net income available to common stockholders$29,872  $31,321  $32,097  $32,219  $32,999 
              
    Weighted average diluted common shares outstanding 39,727,606   39,792,937   39,869,468   39,872,829   39,788,881 
    Diluted EPS$0.75  $0.79  $0.80  $0.81  $0.82 
              
    Reconciliation of GAAP Earnings to Pre-tax and Pre-provision Net Revenue        
    Net income$31,381  $33,038  $32,097  $32,219  $32,999 
    Income tax expense 11,351   12,301   10,881   10,652   10,871 
    Provision for (reversal of) credit losses 1,450   815   1,100   (1,649)  (5,766)
    Pre-tax and pre-provision net revenue$44,182  $46,154  $44,078  $41,222  $38,104 
              
    Return on Assets Measures         
    Average assets$8,263,382  $8,027,169  $7,837,997  $7,566,676  $7,500,034 
    Return on avg. assets 1.54 % 1.63 % 1.62 % 1.71 % 1.78%
    Return on avg. assets (pre-tax and pre-provision) 2.17   2.28   2.23   2.19   2.06 
              
     Three Months Ended
     Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31,
      2022   2021   2021   2021   2021 
    Return on Equity Measures(dollars in thousands)
    Average stockholders' equity$1,131,968  $1,113,524  $1,032,195  $952,019  $928,041 
    Less: average preferred stock (110,927)  (110,927)  (51,847)  -   - 
    Average common equity$1,021,041  $1,002,597  $980,348  $952,019  $928,041 
    Less: average intangible assets (217,219)  (217,685)  (218,170)  (218,662)  (219,171)
    Average tangible common equity$803,822  $784,912  $762,178  $733,357  $708,870 
              
    Return on avg. common equity (GAAP) 11.87 % 12.39 % 12.99 % 13.57 % 14.42%
    Return on avg. tangible common equity ("TCE") (non-GAAP) (1) 15.22   16.00   16.88   17.82   19.08 
    Return on avg. tangible common equity (pre-tax, pre-provision) 22.44   23.50   23.12   22.74   22.00 
              
    Efficiency Measures         
    Total noninterest expenses$29,230  $28,084  $28,183  $26,259  $26,485 
    Amortization of core deposit intangibles (433)  (483)  (483)  (508)  (507)
    Operating noninterest expense$28,797  $27,601  $27,700  $25,751  $25,978 
              
    Net interest income (tax equivalent basis)$70,842  $70,890  $68,761  $63,418  $61,581 
    Noninterest income 3,054   3,777   4,016   4,472   3,426 
    Net losses (gains) on equity securities 596   131   78   (23)  187 
    Net gains on sale/redemption of investment securities -   -   -   (195)  - 
    Operating revenue$74,492  $74,798  $72,855  $67,672  $64,520 
              
    Operating efficiency ratio (non-GAAP) (2) 38.7 % 36.9 % 38.0 % 38.1 % 40.3%
              
    Net Interest Margin         
    Average interest-earning assets$7,753,881  $7,508,973  $7,321,771  $7,059,965  $7,008,500 
              
    Net interest income (tax equivalent basis)$70,842  $70,890  $68,761  $63,418  $61,581 
    Impact of purchase accounting fair value marks (1,179)  (1,674)  (1,849)  (2,012)  (2,074)
    Adjusted net interest income (tax equivalent basis)$69,663  $69,216  $66,912  $61,406  $59,507 
              
    Net interest margin (GAAP) 3.71 % 3.75 % 3.73 % 3.60 % 3.56%
    Adjusted net interest margin (non-GAAP) (3) 3.64   3.66   3.63   3.49   3.44 
              
    (1) Earnings available to common stockholders excluding amortization of intangible assets divided by average tangible common equity.  
    (2) Operating noninterest expense divided by operating revenue.         
    (3) Adjusted net interest margin excludes impact of purchase accounting fair value marks.      
              
     As of
     Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31,
      2022   2021   2021   2021   2021 
    Capital Ratios and Book Value per Share(dollars in thousands, except for per share data)
    Stockholders equity$1,138,519  $1,124,212  $1,098,433  $964,960  $935,637 
    Less: preferred stock (110,927)  (110,927)  (110,927)  -   - 
    Common equity$1,027,592  $1,013,285  $987,506  $964,960  $935,637 
    Less: intangible assets (216,936)  (217,369)  (217,852)  (218,335)  (218,842)
    Tangible common equity$810,656  $795,916  $769,654  $746,625  $716,795 
              
    Total assets$8,334,301  $8,129,480  $7,949,514  $7,710,082  $7,449,639 
    Less: intangible assets (216,936)  (217,369)  (217,852)  (218,335)  (218,842)
    Tangible assets$8,117,365  $7,912,111  $7,731,662  $7,491,747  $7,230,797 
              
    Common shares outstanding 39,518,411   39,568,090   39,602,199   39,794,815   39,773,602 
              
    Common equity ratio (GAAP) 12.33 % 13.83 % 13.82 % 12.52 % 12.56%
    Tangible common equity ratio (non-GAAP) (4) 9.99   10.06   9.95   9.97   9.91 
              
    Regulatory capital ratios (Bancorp):         
      Leverage ratio 11.57 % 11.65 % 11.60 % 10.19 % 9.89%
      Common equity Tier 1 risk-based ratio 10.69   10.64   10.73   11.09   11.36 
      Risk-based Tier 1 capital ratio 12.21   12.19   12.35   11.17   11.44 
      Risk-based total capital ratio 15.23   15.26   15.54   14.58   15.08 
              
    Regulatory capital ratios (Bank):         
      Leverage ratio 11.41 % 11.43 % 11.33 % 11.34 % 11.06%
      Common equity Tier 1 risk-based ratio 12.04   11.96   12.06   12.42   12.78 
      Risk-based Tier 1 capital ratio 12.04   11.96   12.06   12.42   12.78 
      Risk-based total capital ratio 13.52   13.44   13.61   14.07   14.55 
              
    Book value per share (GAAP)$26.00  $25.61  $24.94  $24.25  $23.52 
    Tangible book value per share (non-GAAP) (5) 20.51   20.12   19.43   18.76   18.02 
              
    Net Loan (Recoveries) Charge-Off Detail         
    Net loan charge-offs (recoveries):         
      Charge-offs$274  $458  $1,727  $212  $- 
      Recoveries (32)  (217)  (113)  (14)  (61)
       Net loan charge-offs (recoveries)$242  $241  $1,614  $198  $(61)
       Net loan charge-offs (recoveries) as a % of average loans receivable (annualized) 0.01 % 0.01 % 0.10 % 0.01 % (0.00)%
              
    Asset Quality         
    Nonaccrual loans$59,403  $61,700  $65,959  $56,213  $60,940 
    OREO 316   -   -   -   - 
    Nonperforming assets$59,719  $61,700  $65,959  $56,213  $60,940 
              
    Allowance for credit losses - loans ("ACL") 80,070   78,773   77,986   78,684   80,568 
              
    Loans receivable$6,979,595  $6,828,622  $6,576,439  $6,407,904  $6,277,191 
    Less: PPP loans 54,301   93,057   177,829   326,788   522,340 
    Loans receivable (excluding PPP loans)$6,925,294  $6,735,565  $6,398,610  $6,081,116  $5,754,851 
              
    Nonaccrual loans as a % of loans receivable 0.85 % 0.90 % 1.00 % 0.88 % 0.97 
    Nonperforming assets as a % of total assets 0.72   0.76   0.83   0.73   0.82 
    ACL as a % of loans receivable 1.15   1.15   1.19   1.23   1.28 
    ACL as a % of loans receivable (excluding PPP loans) 1.16   1.17   1.22   1.29   1.40 
    ACL as a % of nonaccrual loans 134.8   127.7   118.2   140.0   132.2 
              
    (4) Tangible common equity divided by tangible assets.         
    (5) Tangible common equity divided by common shares outstanding at period-end.        
              



    CONNECTONE BANCORP, INC. AND SUBSIDIARIES             
    NET INTEREST MARGIN ANALYSIS              
    (dollars in thousands)               
        For the Three Months Ended 
        March 31, 2022December 31, 2021March 31, 2021 
        Average     Average     Average    
    Interest-earning assets: BalanceInterestRate (7) BalanceInterestRate (7) BalanceInterestRate (7)
    Investment securities (1) (2)$545,203 $2,771 2.06% $480,143 $1,921 1.59% $473,181 $2,058 1.76%
    Loans receivable and loans held-for-sale (2) (3) (4)    6,871,477  76,320 4.50   6,717,685  77,220 4.56   6,242,960  70,676 4.59 
    Federal funds sold and interest-              
      bearing deposits with banks 312,224  120 0.16   291,243  121 0.16   269,537  49 0.07 
    Restricted investment in bank stock 24,977  214 3.47   19,902  207 4.13   22,822  256 4.55 
         Total interest-earning assets 7,753,881  79,425 4.15   7,508,973  79,469 4.20   7,008,500  73,039 4.23 
    Allowance for loan losses  (79,763)     (79,074)     (81,549)   
    Noninterest-earning assets  589,264      597,270      573,083    
         Total assets  $8,263,382     $8,027,169     $7,500,034    
                      
    Interest-bearing liabilities:              
     Time deposits  $1,124,614  2,154 0.78  $1,204,374 $2,717 0.90   1,422,295  5,151 1.47 
     Other interest-bearing deposits 3,851,558  2,856 0.30   3,672,311  2,563 0.28   3,225,751  2,434 0.31 
         Total interest-bearing deposits 4,976,172  5,010 0.41   4,876,685  5,280 0.43   4,648,046  7,585 0.66 
                      
    Borrowings   404,907  1,377 1.38   292,847  1,102 1.49   375,511  1,674 1.81 
    Subordinated debentures  152,977  2,168 5.75   152,902  2,167 5.62   154,341  2,167 5.69 
    Capital lease obligation  1,917  28 5.92   1,967  30 6.05   2,115  32 6.14 
         Total interest-bearing liabilities 5,535,973  8,583 0.63   5,324,401  8,579 0.64   5,180,013  11,458 0.90 
                      
    Noninterest-bearing demand deposits 1,547,055      1,537,316      1,348,585    
    Other liabilities   48,386      51,928      43,395    
         Total noninterest-bearing liabilities 1,595,441      1,589,244      1,391,980    
    Stockholders' equity  1,131,968      1,113,524      928,041    
         Total liabilities and stockholders' equity$8,263,382     $8,027,169     $7,500,034    
                      
    Net interest income (tax equivalent basis)  70,842      70,890      61,581   
    Net interest spread (5)   3.53%   3.56%   3.33%
                      
    Net interest margin (6)   3.71%   3.75%   3.56%
                      
    Tax equivalent adjustment   (484)     (429)     (418)  
    Net interest income  $70,358     $70,461     $61,163   
                      
    (1) Average balances are calculated on amortized cost.             
    (2) Interest income is presented on a tax equivalent basis using 21% federal tax rate.           
    (3) Includes loan fee income and accretion of purchase accounting adjustments.            
    (4) Loans include nonaccrual loans.              
    (5) Represents difference between the average yield on interest-earning assets and the average cost of interest-bearing       
          liabilities and is presented on a tax equivalent basis.             
    (6) Represents net interest income on a tax equivalent basis divided by average total interest-earning assets.        
    (7) Rates are annualized.               
                    
                      


     

     


    Primary Logo

شارك على،