☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Massachusetts
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04-2976299
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(State or other jurisdiction of
incorporation or organization) |
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(I.R.S. Employer
Identification Number) |
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|||
Ten Post Office Square
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02109
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Boston,
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Massachusetts
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(Address of Principal Executive Offices)
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(Zip Code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange which registered
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Common Stock
|
BPFH
|
NASDAQ Stock Market LLC
|
Common Stock, Par Value $1.00 Per Share
|
83,242,001
|
(class)
|
(outstanding)
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PART I—FINANCIAL INFORMATION
|
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Item 1
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Item 2
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Results of Operations
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Item 3
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Item 4
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PART II—OTHER INFORMATION
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Item 1
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Item 1A
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Item 2
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Item 3
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Item 4
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Item 5
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Item 6
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Certifications
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BOSTON PRIVATE FINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Unaudited)
|
|||||||
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September 30, 2019
|
|
December 31, 2018
|
||||
|
(In thousands, except share
and per share data)
|
||||||
Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
78,010
|
|
|
$
|
127,259
|
|
Investment securities available-for-sale (amortized cost of $922,112 and $1,018,774 at September 30, 2019 and December 31, 2018, respectively)
|
935,538
|
|
|
994,065
|
|
||
Investment securities held-to-maturity (fair value of $51,015 and $68,595 at September 30, 2019 and December 31, 2018, respectively)
|
51,379
|
|
|
70,438
|
|
||
Equity securities at fair value
|
21,780
|
|
|
14,228
|
|
||
Stock in Federal Home Loan Bank and Federal Reserve Bank
|
47,756
|
|
|
49,263
|
|
||
Loans held for sale
|
6,658
|
|
|
2,812
|
|
||
Total loans
|
7,067,151
|
|
|
6,893,158
|
|
||
Less: Allowance for loan losses
|
75,359
|
|
|
75,312
|
|
||
Net loans
|
6,991,792
|
|
|
6,817,846
|
|
||
Other real estate owned (“OREO”)
|
—
|
|
|
401
|
|
||
Premises and equipment, net
|
42,658
|
|
|
45,412
|
|
||
Goodwill
|
57,607
|
|
|
57,607
|
|
||
Intangible assets, net
|
10,622
|
|
|
12,227
|
|
||
Fees receivable
|
5,007
|
|
|
5,101
|
|
||
Accrued interest receivable
|
24,851
|
|
|
24,366
|
|
||
Deferred income taxes, net
|
15,704
|
|
|
26,638
|
|
||
Right-of-use assets
|
107,045
|
|
|
—
|
|
||
Other assets
|
294,537
|
|
|
246,962
|
|
||
Total assets
|
$
|
8,690,944
|
|
|
$
|
8,494,625
|
|
Liabilities:
|
|
|
|
||||
Deposits
|
$
|
6,658,242
|
|
|
$
|
6,781,170
|
|
Securities sold under agreements to repurchase
|
48,860
|
|
|
36,928
|
|
||
Federal funds purchased
|
230,000
|
|
|
250,000
|
|
||
Federal Home Loan Bank borrowings
|
570,904
|
|
|
420,144
|
|
||
Junior subordinated debentures
|
106,363
|
|
|
106,363
|
|
||
Lease liabilities
|
122,799
|
|
|
—
|
|
||
Other liabilities
|
143,607
|
|
|
143,540
|
|
||
Total liabilities
|
7,880,775
|
|
|
7,738,145
|
|
||
Redeemable Noncontrolling Interests
|
1,481
|
|
|
2,526
|
|
||
Shareholders’ Equity:
|
|
|
|
||||
Common stock, $1.00 par value; authorized: 170,000,000 shares; issued and outstanding: 83,241,952 shares at September 30, 2019 and 83,655,651 shares at December 31, 2018
|
83,242
|
|
|
83,656
|
|
||
Additional paid-in capital
|
599,877
|
|
|
600,196
|
|
||
Retained earnings
|
116,210
|
|
|
87,821
|
|
||
Accumulated other comprehensive income/ (loss)
|
9,359
|
|
|
(17,719
|
)
|
||
Total shareholders’ equity
|
808,688
|
|
|
753,954
|
|
||
Total liabilities, redeemable noncontrolling interests and shareholders’ equity
|
$
|
8,690,944
|
|
|
$
|
8,494,625
|
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
|
|||||||||||||||
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In thousands, except share and per share data)
|
||||||||||||||
Interest and dividend income:
|
|
|
|
|
|
|
|
||||||||
Loans
|
$
|
71,036
|
|
|
$
|
68,254
|
|
|
$
|
212,912
|
|
|
$
|
193,231
|
|
Taxable investment securities
|
938
|
|
|
1,510
|
|
|
3,244
|
|
|
4,521
|
|
||||
Non-taxable investment securities
|
1,924
|
|
|
1,779
|
|
|
5,726
|
|
|
5,261
|
|
||||
Mortgage-backed securities
|
2,622
|
|
|
2,941
|
|
|
8,225
|
|
|
9,168
|
|
||||
Short-term investments and other
|
1,084
|
|
|
1,617
|
|
|
3,049
|
|
|
3,831
|
|
||||
Total interest and dividend income
|
77,604
|
|
|
76,101
|
|
|
233,156
|
|
|
216,012
|
|
||||
Interest expense:
|
|
|
|
|
|
|
|
||||||||
Deposits
|
15,487
|
|
|
11,487
|
|
|
44,060
|
|
|
26,376
|
|
||||
Federal Home Loan Bank borrowings
|
4,337
|
|
|
3,877
|
|
|
12,144
|
|
|
11,668
|
|
||||
Junior subordinated debentures
|
1,022
|
|
|
1,028
|
|
|
3,223
|
|
|
2,882
|
|
||||
Repurchase agreements and other short-term borrowings
|
605
|
|
|
68
|
|
|
1,778
|
|
|
517
|
|
||||
Total interest expense
|
21,451
|
|
|
16,460
|
|
|
61,205
|
|
|
41,443
|
|
||||
Net interest income
|
56,153
|
|
|
59,641
|
|
|
171,951
|
|
|
174,569
|
|
||||
Provision/ (credit) for loan losses
|
167
|
|
|
(949
|
)
|
|
104
|
|
|
(2,291
|
)
|
||||
Net interest income after provision/ (credit) for loan losses
|
55,986
|
|
|
60,590
|
|
|
171,847
|
|
|
176,860
|
|
||||
Fees and other income:
|
|
|
|
|
|
|
|
||||||||
Wealth management and trust fees
|
19,067
|
|
|
25,505
|
|
|
57,037
|
|
|
76,030
|
|
||||
Investment management fees
|
2,496
|
|
|
3,245
|
|
|
7,601
|
|
|
18,897
|
|
||||
Other banking fee income
|
2,658
|
|
|
2,775
|
|
|
8,024
|
|
|
7,793
|
|
||||
Gain on sale of loans, net
|
934
|
|
|
67
|
|
|
1,065
|
|
|
204
|
|
||||
Gain/ (loss) on sale of investments, net
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
||||
Gain/ (loss) on OREO, net
|
—
|
|
|
—
|
|
|
91
|
|
|
—
|
|
||||
Other
|
(29
|
)
|
|
722
|
|
|
936
|
|
|
1,245
|
|
||||
Total fees and other income
|
25,126
|
|
|
32,314
|
|
|
74,754
|
|
|
104,152
|
|
||||
Operating expense:
|
|
|
|
|
|
|
|
||||||||
Salaries and employee benefits
|
31,684
|
|
|
38,944
|
|
|
100,116
|
|
|
125,461
|
|
||||
Occupancy and equipment
|
8,260
|
|
|
8,164
|
|
|
24,460
|
|
|
24,141
|
|
||||
Information systems
|
5,169
|
|
|
6,233
|
|
|
16,166
|
|
|
18,889
|
|
||||
Professional services
|
4,435
|
|
|
2,877
|
|
|
11,308
|
|
|
8,926
|
|
||||
Marketing and business development
|
1,403
|
|
|
1,710
|
|
|
4,422
|
|
|
5,373
|
|
||||
Amortization of intangibles
|
671
|
|
|
750
|
|
|
2,015
|
|
|
2,249
|
|
||||
FDIC insurance
|
59
|
|
|
674
|
|
|
1,304
|
|
|
2,126
|
|
||||
Restructuring
|
—
|
|
|
5,763
|
|
|
1,646
|
|
|
5,763
|
|
||||
Other
|
3,856
|
|
|
3,442
|
|
|
10,312
|
|
|
10,870
|
|
||||
Total operating expense
|
55,537
|
|
|
68,557
|
|
|
171,749
|
|
|
203,798
|
|
||||
Income before income taxes
|
25,575
|
|
|
24,347
|
|
|
74,852
|
|
|
77,214
|
|
||||
Income tax expense
|
5,517
|
|
|
5,461
|
|
|
15,803
|
|
|
28,886
|
|
||||
Net income from continuing operations
|
20,058
|
|
|
18,886
|
|
|
59,049
|
|
|
48,328
|
|
||||
Net income from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
1,696
|
|
||||
Net income before attribution to noncontrolling interests
|
20,058
|
|
|
18,886
|
|
|
59,049
|
|
|
50,024
|
|
||||
(Continued)
|
|
|
|
|
|
|
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
|
|||||||||||||||
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Less: Net income attributable to noncontrolling interests
|
96
|
|
|
924
|
|
|
265
|
|
|
2,942
|
|
||||
Net income attributable to the Company
|
$
|
19,962
|
|
|
$
|
17,962
|
|
|
$
|
58,784
|
|
|
$
|
47,082
|
|
Adjustments to net income attributable to the Company to arrive at net income attributable to common shareholders
|
304
|
|
|
(829
|
)
|
|
1,045
|
|
|
(4,376
|
)
|
||||
Net income attributable to common shareholders for earnings per share calculation
|
$
|
20,266
|
|
|
$
|
17,133
|
|
|
$
|
59,829
|
|
|
$
|
42,706
|
|
Basic earnings per share attributable to common shareholders:
|
|
|
|
|
|
|
|
||||||||
From continuing operations:
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.72
|
|
|
$
|
0.49
|
|
From discontinued operations:
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.02
|
|
Total attributable to common shareholders:
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.72
|
|
|
$
|
0.51
|
|
Weighted average basic common shares outstanding
|
83,631,403
|
|
|
84,017,284
|
|
|
83,495,361
|
|
|
83,544,754
|
|
||||
Diluted earnings per share attributable to common shareholders:
|
|
|
|
|
|
|
|
||||||||
From continuing operations:
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.71
|
|
|
$
|
0.48
|
|
From discontinued operations:
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.02
|
|
Total attributable to common shareholders:
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.71
|
|
|
$
|
0.50
|
|
Weighted average diluted common shares outstanding
|
83,956,708
|
|
|
85,498,568
|
|
|
84,003,281
|
|
|
85,254,295
|
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
|
|||||||||||||||
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In thousands)
|
||||||||||||||
Net income attributable to the Company
|
$
|
19,962
|
|
|
$
|
17,962
|
|
|
$
|
58,784
|
|
|
$
|
47,082
|
|
Other comprehensive income/ (loss), net of tax:
|
|
|
|
|
|
|
|
||||||||
Net unrealized gain/ (loss) on securities available-for-sale
|
5,236
|
|
|
(4,040
|
)
|
|
27,469
|
|
|
(18,888
|
)
|
||||
Unrealized gain/ (loss) on cash flow hedges
|
2
|
|
|
(138
|
)
|
|
(31
|
)
|
|
574
|
|
||||
Reclassification adjustment for net realized (gain)/ loss included in net income
|
(4
|
)
|
|
(72
|
)
|
|
(360
|
)
|
|
(273
|
)
|
||||
Net unrealized gain/ (loss) on cash flow hedges
|
(2
|
)
|
|
(210
|
)
|
|
(391
|
)
|
|
301
|
|
||||
Net unrealized gain/ (loss) on other
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
Other comprehensive income/ (loss), net of tax
|
5,234
|
|
|
(4,250
|
)
|
|
27,078
|
|
|
(18,586
|
)
|
||||
Total comprehensive income attributable to the Company, net
|
$
|
25,196
|
|
|
$
|
13,712
|
|
|
$
|
85,862
|
|
|
$
|
28,496
|
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)
|
|||||||||||||||||||||||||||
|
Preferred
Stock
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income/
(Loss)
|
|
Non-
controlling
Interests
|
|
Total
|
||||||||||||||
|
(In thousands, except share data)
|
||||||||||||||||||||||||||
Balance, December 31, 2017
|
$
|
47,753
|
|
|
$
|
84,208
|
|
|
$
|
607,929
|
|
|
$
|
49,526
|
|
|
$
|
(8,658
|
)
|
|
$
|
5,186
|
|
|
$
|
785,944
|
|
Reclassification due to change in accounting principles (1)
|
—
|
|
|
—
|
|
|
—
|
|
|
334
|
|
|
(334
|
)
|
|
—
|
|
|
—
|
|
|||||||
Net income attributable to the Company
|
—
|
|
|
—
|
|
|
—
|
|
|
47,082
|
|
|
—
|
|
|
—
|
|
|
47,082
|
|
|||||||
Other comprehensive income/ (loss), net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,586
|
)
|
|
—
|
|
|
(18,586
|
)
|
|||||||
Dividends paid to common shareholders:
$0.36 per share |
—
|
|
|
—
|
|
|
—
|
|
|
(30,586
|
)
|
|
—
|
|
|
—
|
|
|
(30,586
|
)
|
|||||||
Dividends paid to preferred shareholders
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,738
|
)
|
|
—
|
|
|
—
|
|
|
(1,738
|
)
|
|||||||
Net change in noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,977
|
)
|
|
(2,977
|
)
|
|||||||
Redemption of Series D preferred stock
|
(47,753
|
)
|
|
—
|
|
|
(2,247
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(50,000
|
)
|
|||||||
Repurchase of 137,114 shares of common stock
|
—
|
|
|
(137
|
)
|
|
(1,768
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,905
|
)
|
|||||||
Net proceeds from issuance of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
142,738 shares of common stock
|
—
|
|
|
143
|
|
|
1,722
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,865
|
|
|||||||
7,355 shares of incentive stock grants, net of 132,964 incentive stock grant shares canceled or forfeited and 127,894 shares withheld for employee taxes
|
—
|
|
|
(253
|
)
|
|
(1,699
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,952
|
)
|
|||||||
Exercise of warrants
|
—
|
|
|
438
|
|
|
(277
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
161
|
|
|||||||
Amortization of stock compensation and employee stock purchase plan
|
—
|
|
|
—
|
|
|
5,131
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,131
|
|
|||||||
Stock options exercised
|
—
|
|
|
204
|
|
|
1,457
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,661
|
|
|||||||
Other equity adjustments
|
—
|
|
|
—
|
|
|
3,909
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,909
|
|
|||||||
Balance at September 30, 2018
|
$
|
—
|
|
|
$
|
84,603
|
|
|
$
|
614,157
|
|
|
$
|
64,618
|
|
|
$
|
(27,578
|
)
|
|
$
|
2,209
|
|
|
$
|
738,009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance, December 31, 2018
|
$
|
—
|
|
|
$
|
83,656
|
|
|
$
|
600,196
|
|
|
$
|
87,821
|
|
|
$
|
(17,719
|
)
|
|
$
|
—
|
|
|
$
|
753,954
|
|
Net income attributable to the Company
|
—
|
|
|
—
|
|
|
—
|
|
|
58,784
|
|
|
—
|
|
|
—
|
|
|
58,784
|
|
|||||||
Other comprehensive income/ (loss), net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,078
|
|
|
—
|
|
|
27,078
|
|
|||||||
Dividends paid to common shareholders:
$0.36 per share |
—
|
|
|
—
|
|
|
—
|
|
|
(30,395
|
)
|
|
—
|
|
|
—
|
|
|
(30,395
|
)
|
|||||||
Repurchase of 678,165 shares of common stock
|
—
|
|
|
(678
|
)
|
|
(6,515
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,193
|
)
|
|||||||
Net proceeds from issuance of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
265,937 shares of common stock
|
—
|
|
|
266
|
|
|
2,008
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,274
|
|
|||||||
42,004 shares of incentive stock grants, net of 9,377 shares canceled or forfeited and 115,173 shares withheld for employee taxes
|
—
|
|
|
(83
|
)
|
|
(522
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(605
|
)
|
|||||||
Amortization of stock compensation and employee stock purchase plan
|
—
|
|
|
—
|
|
|
3,359
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,359
|
|
|||||||
Stock options exercised
|
—
|
|
|
81
|
|
|
464
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
545
|
|
|||||||
Other equity adjustments
|
—
|
|
|
—
|
|
|
887
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
887
|
|
|||||||
Balance at September 30, 2019
|
$
|
—
|
|
|
$
|
83,242
|
|
|
$
|
599,877
|
|
|
$
|
116,210
|
|
|
$
|
9,359
|
|
|
$
|
—
|
|
|
$
|
808,688
|
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
|
|||||||
|
Nine months ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In thousands)
|
||||||
Cash flows from operating activities:
|
|
|
|
||||
Net income attributable to the Company
|
$
|
58,784
|
|
|
$
|
47,082
|
|
Adjustments to arrive at net income from continuing operations
|
|
|
|
||||
Net income attributable to noncontrolling interests
|
265
|
|
|
2,942
|
|
||
Less: Net income from discontinued operations
|
—
|
|
|
(1,696
|
)
|
||
Net income from continuing operations
|
59,049
|
|
|
48,328
|
|
||
Adjustments to reconcile net income from continuing operations to net cash provided by/ (used in) operating activities:
|
|
|
|
||||
Depreciation and amortization
|
17,726
|
|
|
17,192
|
|
||
Net income attributable to noncontrolling interests
|
(265
|
)
|
|
(2,942
|
)
|
||
Stock compensation, net of cancellations
|
4,022
|
|
|
5,232
|
|
||
Provision/ (credit) for loan losses
|
104
|
|
|
(2,291
|
)
|
||
Loans originated for sale
|
(32,796
|
)
|
|
(32,364
|
)
|
||
Proceeds from sale of loans held for sale
|
29,176
|
|
|
33,935
|
|
||
Deferred income tax expense/ (benefit)
|
432
|
|
|
8,548
|
|
||
Increase in right-of-use assets
|
1,416
|
|
|
—
|
|
||
Increase in operating lease liabilities
|
(1,465
|
)
|
|
—
|
|
||
Net decrease/ (increase) in other operating activities
|
(36,916
|
)
|
|
(14,348
|
)
|
||
Net cash provided by/ (used in) operating activities of continuing operations
|
40,483
|
|
|
61,290
|
|
||
Net cash provided by/ (used in) operating activities of discontinued operations
|
—
|
|
|
1,696
|
|
||
Net cash provided by/ (used in) operating activities
|
40,483
|
|
|
62,986
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Investment securities available-for-sale:
|
|
|
|
||||
Purchases
|
(24,977
|
)
|
|
(25,204
|
)
|
||
Sales
|
—
|
|
|
24
|
|
||
Maturities, calls, redemptions, and principal payments
|
115,857
|
|
|
86,085
|
|
||
Investment securities held-to-maturity:
|
|
|
|
||||
Purchases
|
—
|
|
|
(11,876
|
)
|
||
Maturities, calls, and principal payments
|
18,880
|
|
|
10,726
|
|
||
Equity securities at fair value:
|
|
|
|
||||
Purchases
|
(44,537
|
)
|
|
(38,042
|
)
|
||
Sales
|
36,985
|
|
|
51,757
|
|
||
(Investments)/ distributions in trusts, net
|
357
|
|
|
1,252
|
|
||
Contingent considerations from divestitures
|
3,254
|
|
|
—
|
|
||
(Purchase)/ redemption of Federal Home Loan Bank and Federal Reserve Bank stock
|
1,507
|
|
|
11,246
|
|
||
Net increase in portfolio loans
|
(268,238
|
)
|
|
(217,317
|
)
|
||
Proceeds from recoveries of loans previously charged-off
|
887
|
|
|
1,578
|
|
||
Proceeds from sale of OREO
|
492
|
|
|
—
|
|
||
Proceeds from sale of portfolio loans
|
92,304
|
|
|
—
|
|
||
Capital expenditures
|
(5,795
|
)
|
|
(18,349
|
)
|
||
Proceeds from sale of affiliate
|
—
|
|
|
34,120
|
|
||
Net cash provided by/ (used in) investing activities
|
(73,024
|
)
|
|
(114,000
|
)
|
||
(Continued)
|
|
|
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
|
|||||||
|
Nine months ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In thousands)
|
||||||
Cash flows from financing activities:
|
|
|
|
||||
Net increase/ (decrease) in deposits
|
(122,928
|
)
|
|
258,477
|
|
||
Net increase/ (decrease) in securities sold under agreements to repurchase
|
11,932
|
|
|
7,284
|
|
||
Net increase/ (decrease) in federal funds purchased
|
(20,000
|
)
|
|
90,000
|
|
||
Net increase/ (decrease) in short-term Federal Home Loan Bank borrowings
|
110,000
|
|
|
(230,000
|
)
|
||
Advances of long-term Federal Home Loan Bank borrowings
|
340,000
|
|
|
91,444
|
|
||
Repayments of long-term Federal Home Loan Bank borrowings
|
(299,240
|
)
|
|
(113,289
|
)
|
||
Redemption of Series D preferred stock
|
—
|
|
|
(50,000
|
)
|
||
Dividends paid to common shareholders
|
(30,395
|
)
|
|
(30,586
|
)
|
||
Dividends paid to preferred shareholders
|
—
|
|
|
(1,738
|
)
|
||
Proceeds from warrant exercises
|
—
|
|
|
161
|
|
||
Repurchase of common stock
|
(7,193
|
)
|
|
(1,905
|
)
|
||
Proceeds from stock option exercises
|
545
|
|
|
1,661
|
|
||
Proceeds from issuance of common stock
|
2,274
|
|
|
1,865
|
|
||
Tax withholding for share based compensation awards
|
(1,268
|
)
|
|
(2,053
|
)
|
||
Distributions paid to noncontrolling interests
|
(265
|
)
|
|
(2,848
|
)
|
||
Other equity adjustments
|
(170
|
)
|
|
4,634
|
|
||
Net cash provided by/ (used in) financing activities
|
(16,708
|
)
|
|
23,107
|
|
||
Net increase/ (decrease) in cash and cash equivalents
|
(49,249
|
)
|
|
(27,907
|
)
|
||
Cash and cash equivalents at beginning of year
|
127,259
|
|
|
120,541
|
|
||
Cash and cash equivalents at end of period
|
$
|
78,010
|
|
|
$
|
92,634
|
|
Supplemental disclosure of cash flow items:
|
|
|
|
||||
Cash paid for interest
|
$
|
60,489
|
|
|
$
|
40,703
|
|
Cash paid for income taxes, (net of refunds received)
|
18,122
|
|
|
18,898
|
|
||
Change in unrealized gain/ (loss) on available-for-sale securities, net of tax
|
27,469
|
|
|
(18,888
|
)
|
||
Change in unrealized gain/ (loss) on cash flow hedges, net of tax
|
(391
|
)
|
|
301
|
|
||
Change in unrealized gain/ (loss) on other, net of tax
|
—
|
|
|
1
|
|
||
Non-cash transactions:
|
|
|
|
||||
Loans transferred into other real estate owned from loan portfolio
|
—
|
|
|
108
|
|
||
Loans charged-off
|
(944
|
)
|
|
(529
|
)
|
•
|
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ASU 2016-02”). This update and the related amendments to Topic 842 require lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-10, Codification Improvements to Topic 842, Leases (“ASU 2018-10”); ASU No. 2018-11, Leases (Topic 842), Targeted Improvements (“ASU 2018-11”); and ASU No. 2019-01, Leases (Topic 842), Codification Improvements (“ASU 2019-01”). The new standard establishes a right-of-use model (“ROU”) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The new standard was effective on January 1, 2019 and the Company adopted these provisions on January 1, 2019. The most significant effects relate to the recognition of new ROU assets and lease liabilities on the balance sheet for real estate operating leases, providing significant new disclosures about leasing activities, and the impact of additional assets on certain financial measures such as capital ratios and return on average asset ratios. Additionally, the Company elected the package of practical expedients, as prescribed by ASU 2016-02. The Company elected not to reassess whether any expired or existing contracts are or contain leases nor the lease classification of those leases. The Company also elected not to reassess any initial direct costs for any existing leases. On adoption, the Company recognized $124.1 million of lease liabilities and $108.5 million of ROU assets.
|
•
|
In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (a consensus of the FASB Emerging Issues Task Force) (“ASU 2018-15”). The amendments in ASU 2018-15 align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in ASU 2018-15. This update is effective on a retrospective basis for the Company beginning January 1, 2021. The Company early adopted this update on January 1, 2019. The adoption of this update did not have a material impact on the consolidated financial statements.
|
•
|
In October 2018, the FASB issued ASU 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (“SOFR”) Overnight Index Swap (“OIS”) Rate as a Benchmark Interest Rate for Hedge Accounting (“ASU 2018-16”). ASU 2018-16 introduces OIS Rate based on the SOFR as an acceptable US benchmark interest rate for purposes of applying hedge accounting under Topic 815. This update is effective for interim and annual reporting periods beginning after December 15, 2018 because the Company has already adopted ASU 2017-12. The Company adopted this update on January 1, 2019. The adoption of this update did not have a material impact on the consolidated financial statements.
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In thousands, except share and per share data)
|
||||||||||||||
Basic earnings per share - Numerator:
|
|
|
|
|
|
|
|
||||||||
Net income from continuing operations
|
$
|
20,058
|
|
|
$
|
18,886
|
|
|
$
|
59,049
|
|
|
$
|
48,328
|
|
Less: Net income attributable to noncontrolling interests
|
96
|
|
|
924
|
|
|
265
|
|
|
2,942
|
|
||||
Net income from continuing operations attributable to the Company
|
19,962
|
|
|
17,962
|
|
|
58,784
|
|
|
45,386
|
|
||||
Decrease/ (increase) in noncontrolling interests’ redemption values (1)
|
304
|
|
|
(829
|
)
|
|
1,045
|
|
|
(391
|
)
|
||||
Dividends on preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,985
|
)
|
||||
Total adjustments to income attributable to common shareholders
|
304
|
|
|
(829
|
)
|
|
1,045
|
|
|
(4,376
|
)
|
||||
Net income from continuing operations attributable to common shareholders, treasury stock method
|
20,266
|
|
|
17,133
|
|
|
59,829
|
|
|
41,010
|
|
||||
Net income from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
1,696
|
|
||||
Net income attributable to common shareholders, treasury stock method
|
$
|
20,266
|
|
|
$
|
17,133
|
|
|
$
|
59,829
|
|
|
$
|
42,706
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share - Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted average basic common shares outstanding
|
83,631,403
|
|
|
84,017,284
|
|
|
83,495,361
|
|
|
83,544,754
|
|
||||
Per share data - Basic earnings per share from:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.72
|
|
|
$
|
0.49
|
|
Discontinued operations
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.02
|
|
Total attributable to common shareholders
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.72
|
|
|
$
|
0.51
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In thousands, except share and per share data)
|
||||||||||||||
Diluted earnings per share - Numerator:
|
|
|
|
|
|
|
|
||||||||
Net income from continuing operations attributable to common shareholders, after assumed dilution
|
$
|
20,266
|
|
|
$
|
17,133
|
|
|
$
|
59,829
|
|
|
$
|
41,010
|
|
Net income from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
1,696
|
|
||||
Net income attributable to common shareholders, after assumed dilution
|
$
|
20,266
|
|
|
$
|
17,133
|
|
|
$
|
59,829
|
|
|
$
|
42,706
|
|
Diluted earnings per share - Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted average basic common shares outstanding
|
83,631,403
|
|
|
84,017,284
|
|
|
83,495,361
|
|
|
83,544,754
|
|
||||
Dilutive effect of:
|
|
|
|
|
|
|
|
||||||||
Time-based and market-based stock options, performance-based and time-based restricted stock, and performance-based and time-based restricted stock units, and other dilutive securities (2)
|
325,305
|
|
|
853,906
|
|
|
507,920
|
|
|
1,052,855
|
|
||||
Warrants to purchase common stock
|
—
|
|
|
627,378
|
|
|
—
|
|
|
656,686
|
|
||||
Dilutive common shares
|
325,305
|
|
|
1,481,284
|
|
|
507,920
|
|
|
1,709,541
|
|
||||
Weighted average diluted common shares outstanding (2)
|
83,956,708
|
|
|
85,498,568
|
|
|
84,003,281
|
|
|
85,254,295
|
|
||||
Per share data - Diluted earnings per share from:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.71
|
|
|
$
|
0.48
|
|
Discontinued operations
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.02
|
|
Total attributable to common shareholders
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.71
|
|
|
$
|
0.50
|
|
Dividends per share declared and paid on common stock
|
$
|
0.12
|
|
|
$
|
0.12
|
|
|
$
|
0.36
|
|
|
$
|
0.36
|
|
(1)
|
See Part II. Item 8. “Financial Statements and Supplementary Data - Note 14: Noncontrolling Interests” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 for a description of the redemption values related to the redeemable noncontrolling interests. In accordance with the FASB Accounting Standards Codification Distinguishing Liabilities from Equity (“ASC 480”), an increase in redemption value from period to period reduces income attributable to common shareholders. Decreases in redemption value from period to period increase income attributable to common shareholders, but only to the extent that the cumulative change in redemption value remains a cumulative increase since adoption of this standard in the first quarter of 2009.
|
(2)
|
The diluted EPS computations for the three and nine months ended September 30, 2019 and 2018 do not assume the conversion, exercise, or contingent issuance of the following shares for the following periods because the result would have been anti-dilutive for the periods indicated. As a result of the anti-dilution, the potential common shares excluded from the diluted EPS computation are as follows:
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Shares excluded due to exercise price exceeding the average market price of common shares during the period (total outstanding):
|
(In thousands)
|
||||||||||
Potential common shares from:
|
|
|
|
|
|
|
|
||||
Options, restricted stock, or other dilutive securities
|
808
|
|
|
408
|
|
|
760
|
|
|
226
|
|
Total shares excluded due to exercise price exceeding the average market price of common shares during the period
|
808
|
|
|
408
|
|
|
760
|
|
|
226
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Private Banking
|
(In thousands)
|
||||||||||||||
Net interest income
|
$
|
57,058
|
|
|
$
|
60,551
|
|
|
$
|
174,814
|
|
|
$
|
177,129
|
|
Fees and other income
|
3,403
|
|
|
3,337
|
|
|
9,465
|
|
|
8,637
|
|
||||
Total revenue
|
60,461
|
|
|
63,888
|
|
|
184,279
|
|
|
185,766
|
|
||||
Provision/ (credit) for loan losses
|
167
|
|
|
(949
|
)
|
|
104
|
|
|
(2,291
|
)
|
||||
Operating expense (1)
|
38,134
|
|
|
44,706
|
|
|
117,256
|
|
|
124,003
|
|
||||
Income before income taxes
|
22,160
|
|
|
20,131
|
|
|
66,919
|
|
|
64,054
|
|
||||
Income tax expense
|
4,212
|
|
|
4,469
|
|
|
13,520
|
|
|
13,063
|
|
||||
Net income from continuing operations
|
17,948
|
|
|
15,662
|
|
|
53,399
|
|
|
50,991
|
|
||||
Net income attributable to the Company
|
$
|
17,948
|
|
|
$
|
15,662
|
|
|
$
|
53,399
|
|
|
$
|
50,991
|
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
$
|
8,617,207
|
|
|
$
|
8,292,901
|
|
|
$
|
8,617,207
|
|
|
$
|
8,292,901
|
|
Depreciation
|
$
|
2,229
|
|
|
$
|
2,398
|
|
|
$
|
7,271
|
|
|
$
|
6,013
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Wealth Management and Trust
|
(In thousands)
|
||||||||||||||
Net interest income
|
$
|
99
|
|
|
$
|
98
|
|
|
$
|
309
|
|
|
$
|
222
|
|
Fees and other income
|
19,106
|
|
|
19,769
|
|
|
57,188
|
|
|
59,108
|
|
||||
Total revenue
|
19,205
|
|
|
19,867
|
|
|
57,497
|
|
|
59,330
|
|
||||
Operating expense (1)
|
13,888
|
|
|
16,434
|
|
|
43,864
|
|
|
49,981
|
|
||||
Income before income taxes
|
5,317
|
|
|
3,433
|
|
|
13,633
|
|
|
9,349
|
|
||||
Income tax expense
|
1,751
|
|
|
1,130
|
|
|
4,465
|
|
|
3,019
|
|
||||
Net income from continuing operations
|
3,566
|
|
|
2,303
|
|
|
9,168
|
|
|
6,330
|
|
||||
Net income attributable to the Company
|
$
|
3,566
|
|
|
$
|
2,303
|
|
|
$
|
9,168
|
|
|
$
|
6,330
|
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
$
|
143,326
|
|
|
$
|
127,229
|
|
|
$
|
143,326
|
|
|
$
|
127,229
|
|
Amortization of intangibles
|
$
|
671
|
|
|
$
|
701
|
|
|
$
|
2,015
|
|
|
$
|
2,103
|
|
Depreciation
|
$
|
290
|
|
|
$
|
409
|
|
|
$
|
991
|
|
|
$
|
1,230
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Holding Company and Eliminations (2)
|
(In thousands)
|
||||||||||||||
Net interest income (3)
|
$
|
(1,004
|
)
|
|
$
|
(1,008
|
)
|
|
$
|
(3,172
|
)
|
|
$
|
(2,782
|
)
|
Fees and other income
|
2,617
|
|
|
9,208
|
|
|
8,101
|
|
|
36,407
|
|
||||
Total revenue
|
1,613
|
|
|
8,200
|
|
|
4,929
|
|
|
33,625
|
|
||||
Operating expense
|
3,515
|
|
|
7,417
|
|
|
10,629
|
|
|
29,814
|
|
||||
Income/ (loss) before income taxes
|
(1,902
|
)
|
|
783
|
|
|
(5,700
|
)
|
|
3,811
|
|
||||
Income tax expense/ (benefit)
|
(446
|
)
|
|
(138
|
)
|
|
(2,182
|
)
|
|
12,804
|
|
||||
Net income/ (loss) from continuing operations
|
(1,456
|
)
|
|
921
|
|
|
(3,518
|
)
|
|
(8,993
|
)
|
||||
Noncontrolling interests
|
96
|
|
|
924
|
|
|
265
|
|
|
2,942
|
|
||||
Discontinued operations (4)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,696
|
|
||||
Net income/ (loss) attributable to the Company
|
$
|
(1,552
|
)
|
|
$
|
(3
|
)
|
|
$
|
(3,783
|
)
|
|
$
|
(10,239
|
)
|
|
|
|
|
|
|
|
|
||||||||
Assets (including eliminations)
|
$
|
(69,589
|
)
|
|
$
|
(44,290
|
)
|
|
$
|
(69,589
|
)
|
|
$
|
(44,290
|
)
|
Amortization of intangibles
|
$
|
—
|
|
|
$
|
49
|
|
|
$
|
—
|
|
|
$
|
146
|
|
Depreciation
|
$
|
51
|
|
|
$
|
109
|
|
|
$
|
147
|
|
|
$
|
336
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Total Company (2)
|
(In thousands)
|
||||||||||||||
Net interest income
|
$
|
56,153
|
|
|
$
|
59,641
|
|
|
$
|
171,951
|
|
|
$
|
174,569
|
|
Fees and other income
|
25,126
|
|
|
32,314
|
|
|
74,754
|
|
|
104,152
|
|
||||
Total revenue
|
81,279
|
|
|
91,955
|
|
|
246,705
|
|
|
278,721
|
|
||||
Provision/ (credit) for loan losses
|
167
|
|
|
(949
|
)
|
|
104
|
|
|
(2,291
|
)
|
||||
Operating expense
|
55,537
|
|
|
68,557
|
|
|
171,749
|
|
|
203,798
|
|
||||
Income before income taxes
|
25,575
|
|
|
24,347
|
|
|
74,852
|
|
|
77,214
|
|
||||
Income tax expense
|
5,517
|
|
|
5,461
|
|
|
15,803
|
|
|
28,886
|
|
||||
Net income from continuing operations
|
20,058
|
|
|
18,886
|
|
|
59,049
|
|
|
48,328
|
|
||||
Noncontrolling interests
|
96
|
|
|
924
|
|
|
265
|
|
|
2,942
|
|
||||
Discontinued operations (4)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,696
|
|
||||
Net income attributable to the Company
|
$
|
19,962
|
|
|
$
|
17,962
|
|
|
$
|
58,784
|
|
|
$
|
47,082
|
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
$
|
8,690,944
|
|
|
$
|
8,375,840
|
|
|
$
|
8,690,944
|
|
|
$
|
8,375,840
|
|
Amortization of intangibles
|
$
|
671
|
|
|
$
|
750
|
|
|
$
|
2,015
|
|
|
$
|
2,249
|
|
Depreciation
|
$
|
2,570
|
|
|
$
|
2,916
|
|
|
$
|
8,409
|
|
|
$
|
7,579
|
|
(1)
|
Operating expense includes restructuring expense of $1.3 million and $0.4 million for the nine months ended September 30, 2019 related to the Private Banking and Wealth Management and Trust segments, respectively. Operating expense includes restructuring expense of $5.2 million and $0.6 million for the nine months ended September 30, 2018 related to the Private Banking and Wealth Management & Trust segments, respectively.
|
(2)
|
The results of Anchor and BOS for the periods owned in 2018 are included in Holding Company and Eliminations and the Total Company.
|
(3)
|
Interest expense on junior subordinated debentures is included in Holding Company and Eliminations.
|
(4)
|
The Holding Company and Eliminations calculation of net income attributable to the Company includes net income from discontinued operations of zero and $1.7 million for the nine months ended September 30, 2019 and 2018, respectively. The Company received the final payment related to a revenue sharing agreement with Westfield Capital Management Company, LLC (“Westfield”) in the first quarter of 2018. The Company will not receive additional income from Westfield now that the final payment has been received.
|
|
Amortized
Cost
|
|
Unrealized
|
|
Fair
Value
|
||||||||||
Gains
|
|
Losses
|
|
||||||||||||
(In thousands)
|
|||||||||||||||
At September 30, 2019
|
|
|
|
|
|
|
|
||||||||
Available-for-sale securities at fair value:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
19,953
|
|
|
$
|
104
|
|
|
$
|
—
|
|
|
$
|
20,057
|
|
Government-sponsored entities
|
155,081
|
|
|
1,483
|
|
|
(8
|
)
|
|
156,556
|
|
||||
Municipal bonds
|
314,970
|
|
|
13,055
|
|
|
(10
|
)
|
|
328,015
|
|
||||
Mortgage-backed securities (1)
|
432,108
|
|
|
1,847
|
|
|
(3,045
|
)
|
|
430,910
|
|
||||
Total
|
$
|
922,112
|
|
|
$
|
16,489
|
|
|
$
|
(3,063
|
)
|
|
$
|
935,538
|
|
|
|
|
|
|
|
|
|
||||||||
Held-to-maturity securities at amortized cost:
|
|
|
|
|
|
|
|
||||||||
Mortgage-backed securities (1)
|
$
|
51,379
|
|
|
$
|
33
|
|
|
$
|
(397
|
)
|
|
$
|
51,015
|
|
Total
|
$
|
51,379
|
|
|
$
|
33
|
|
|
$
|
(397
|
)
|
|
$
|
51,015
|
|
|
|
|
|
|
|
|
|
||||||||
Equity securities at fair value:
|
|
|
|
|
|
|
|
||||||||
Money market mutual funds (2)
|
$
|
21,780
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21,780
|
|
Total
|
$
|
21,780
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21,780
|
|
|
|
|
|
|
|
|
|
||||||||
At December 31, 2018
|
|
|
|
|
|
|
|
||||||||
Available-for-sale securities at fair value:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
30,043
|
|
|
$
|
—
|
|
|
$
|
(929
|
)
|
|
$
|
29,114
|
|
Government-sponsored entities
|
211,655
|
|
|
—
|
|
|
(3,952
|
)
|
|
207,703
|
|
||||
Municipal bonds
|
309,837
|
|
|
2,223
|
|
|
(3,101
|
)
|
|
308,959
|
|
||||
Mortgage-backed securities (1)
|
467,239
|
|
|
214
|
|
|
(19,164
|
)
|
|
448,289
|
|
||||
Total
|
$
|
1,018,774
|
|
|
$
|
2,437
|
|
|
$
|
(27,146
|
)
|
|
$
|
994,065
|
|
|
|
|
|
|
|
|
|
||||||||
Held-to-maturity securities at amortized cost:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
9,898
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
9,900
|
|
Mortgage-backed securities (1)
|
60,540
|
|
|
—
|
|
|
(1,845
|
)
|
|
58,695
|
|
||||
Total
|
$
|
70,438
|
|
|
$
|
2
|
|
|
$
|
(1,845
|
)
|
|
$
|
68,595
|
|
|
|
|
|
|
|
|
|
||||||||
Equity securities at fair value:
|
|
|
|
|
|
|
|
||||||||
Money market mutual funds (2)
|
$
|
14,228
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,228
|
|
Total
|
$
|
14,228
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,228
|
|
(1)
|
All mortgage-backed securities are guaranteed by the U.S. government, U.S. government agencies, or government-sponsored entities.
|
(2)
|
Money market mutual funds maintain a constant net asset value of $1.00 and therefore have no unrealized gain or loss.
|
|
Available-for-sale Securities
|
||||||
Amortized
Cost
|
|
Fair
Value
|
|||||
(In thousands)
|
|||||||
Within one year
|
$
|
12,614
|
|
|
$
|
12,647
|
|
After one, but within five years
|
290,921
|
|
|
292,357
|
|
||
After five, but within ten years
|
250,045
|
|
|
253,765
|
|
||
Greater than ten years
|
368,532
|
|
|
376,769
|
|
||
Total
|
$
|
922,112
|
|
|
$
|
935,538
|
|
|
Held-to-maturity Securities
|
||||||
Amortized
Cost
|
|
Fair
Value
|
|||||
(In thousands)
|
|||||||
After five, but within ten years
|
$
|
41,912
|
|
|
$
|
41,593
|
|
Greater than ten years
|
9,467
|
|
|
9,422
|
|
||
Total
|
$
|
51,379
|
|
|
$
|
51,015
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
2019
|
|
2018
|
|
2019
|
|
2018
|
|||||||||
(In thousands)
|
|||||||||||||||
Proceeds from sales
|
$
|
—
|
|
|
$
|
16,231
|
|
|
$
|
—
|
|
|
$
|
51,781
|
|
Realized gains
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
||||
Realized losses
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||
Change in unrealized gain/ (loss) on equity securities reflected in the Consolidated Statement of Operations
|
—
|
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
|||||||||||||||||||||
|
Fair
Value
|
|
Unrealized
Losses
|
|
Fair
Value
|
|
Unrealized
Losses
|
|
Fair
Value
|
|
Unrealized
Losses
|
|
# of
Securities
|
|||||||||||||
|
(In thousands, except number of securities)
|
|||||||||||||||||||||||||
September 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Available-for-sale securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
U.S. government and agencies
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
Government-sponsored entities
|
6,735
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
6,735
|
|
|
(8
|
)
|
|
4
|
|
||||||
Municipal bonds
|
8,506
|
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
|
8,506
|
|
|
(10
|
)
|
|
3
|
|
||||||
Mortgage-backed securities (1)
|
63,489
|
|
|
(226
|
)
|
|
206,795
|
|
|
(2,819
|
)
|
|
270,284
|
|
|
(3,045
|
)
|
|
79
|
|
||||||
Total
|
$
|
78,730
|
|
|
$
|
(244
|
)
|
|
$
|
206,795
|
|
|
$
|
(2,819
|
)
|
|
$
|
285,525
|
|
|
$
|
(3,063
|
)
|
|
86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Held-to-maturity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Mortgage-backed securities (1)
|
$
|
5,608
|
|
|
$
|
(21
|
)
|
|
$
|
32,425
|
|
|
$
|
(376
|
)
|
|
$
|
38,033
|
|
|
$
|
(397
|
)
|
|
13
|
|
Total
|
$
|
5,608
|
|
|
$
|
(21
|
)
|
|
$
|
32,425
|
|
|
$
|
(376
|
)
|
|
$
|
38,033
|
|
|
$
|
(397
|
)
|
|
13
|
|
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
|||||||||||||||||||||
|
Fair
Value |
|
Unrealized
Losses |
|
Fair
Value |
|
Unrealized
Losses |
|
Fair
Value |
|
Unrealized
Losses |
|
# of
Securities |
|||||||||||||
|
(In thousands, except number of securities)
|
|||||||||||||||||||||||||
December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Available-for-sale securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
U.S. government and agencies
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
29,114
|
|
|
$
|
(929
|
)
|
|
$
|
29,114
|
|
|
$
|
(929
|
)
|
|
5
|
|
Government-sponsored entities
|
—
|
|
|
—
|
|
|
207,703
|
|
|
(3,952
|
)
|
|
207,703
|
|
|
(3,952
|
)
|
|
32
|
|
||||||
Municipal bonds
|
25,394
|
|
|
(128
|
)
|
|
130,209
|
|
|
(2,973
|
)
|
|
155,603
|
|
|
(3,101
|
)
|
|
85
|
|
||||||
Mortgage-backed securities (1)
|
2,469
|
|
|
(11
|
)
|
|
433,888
|
|
|
(19,153
|
)
|
|
436,357
|
|
|
(19,164
|
)
|
|
110
|
|
||||||
Total
|
$
|
27,863
|
|
|
$
|
(139
|
)
|
|
$
|
800,914
|
|
|
$
|
(27,007
|
)
|
|
$
|
828,777
|
|
|
$
|
(27,146
|
)
|
|
232
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Held-to-maturity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Mortgage-backed securities (1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
58,695
|
|
|
$
|
(1,845
|
)
|
|
$
|
58,695
|
|
|
$
|
(1,845
|
)
|
|
16
|
|
Total
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
58,695
|
|
|
$
|
(1,845
|
)
|
|
$
|
58,695
|
|
|
$
|
(1,845
|
)
|
|
16
|
|
(1)
|
All mortgage-backed securities are guaranteed by the U.S. government, U.S. government agencies, or government-sponsored entities.
|
|
As of September 30, 2019
|
|
Fair value measurements at reporting date using:
|
||||||||||||
Quoted prices in
active markets
for identical
assets (Level 1)
|
|
Significant
other
observable
inputs (Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
|||||||||||
(In thousands)
|
|||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
20,057
|
|
|
$
|
—
|
|
|
$
|
20,057
|
|
|
$
|
—
|
|
Government-sponsored entities
|
156,556
|
|
|
—
|
|
|
156,556
|
|
|
—
|
|
||||
Municipal bonds
|
328,015
|
|
|
—
|
|
|
328,015
|
|
|
—
|
|
||||
Mortgage-backed securities
|
430,910
|
|
|
—
|
|
|
430,910
|
|
|
—
|
|
||||
Total available-for-sale securities
|
935,538
|
|
|
—
|
|
|
935,538
|
|
|
—
|
|
||||
Equity securities
|
21,780
|
|
|
21,780
|
|
|
—
|
|
|
—
|
|
||||
Derivatives - interest rate customer swaps
|
47,851
|
|
|
—
|
|
|
47,851
|
|
|
—
|
|
||||
Derivatives - risk participation agreement
|
74
|
|
|
—
|
|
|
74
|
|
|
—
|
|
||||
Trading securities held in the “rabbi trust” (1)
|
6,482
|
|
|
6,482
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives - interest rate customer swaps
|
$
|
48,891
|
|
|
$
|
—
|
|
|
$
|
48,891
|
|
|
$
|
—
|
|
Derivatives - risk participation agreement
|
344
|
|
|
—
|
|
|
344
|
|
|
—
|
|
||||
Deferred compensation “rabbi trust” (1)
|
6,482
|
|
|
6,482
|
|
|
—
|
|
|
—
|
|
|
|
|
Fair value measurements at reporting date using:
|
||||||||||||
As of December 31, 2018
|
|
Quoted prices in
active markets
for identical
assets (Level 1)
|
|
Significant
other
observable
inputs (Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
|||||||||
(In thousands)
|
|||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
29,114
|
|
|
$
|
—
|
|
|
$
|
29,114
|
|
|
$
|
—
|
|
Government-sponsored entities
|
207,703
|
|
|
—
|
|
|
207,703
|
|
|
—
|
|
||||
Municipal bonds
|
308,959
|
|
|
—
|
|
|
308,959
|
|
|
—
|
|
||||
Mortgage-backed securities
|
448,289
|
|
|
—
|
|
|
448,289
|
|
|
—
|
|
||||
Total available-for-sale securities
|
994,065
|
|
|
—
|
|
|
994,065
|
|
|
—
|
|
||||
Equity securities
|
14,228
|
|
|
14,228
|
|
|
—
|
|
|
—
|
|
||||
Derivatives - interest rate customer swaps
|
21,889
|
|
|
—
|
|
|
21,889
|
|
|
—
|
|
||||
Derivatives - interest rate swaps
|
553
|
|
|
—
|
|
|
553
|
|
|
—
|
|
||||
Derivatives - risk participation agreements
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Trading securities held in the “rabbi trust” (1)
|
6,839
|
|
|
6,839
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives - interest rate customer swaps
|
$
|
22,385
|
|
|
$
|
—
|
|
|
$
|
22,385
|
|
|
$
|
—
|
|
Derivatives - risk participation agreements
|
152
|
|
|
—
|
|
|
152
|
|
|
—
|
|
||||
Deferred compensation “rabbi trust” (1)
|
6,839
|
|
|
6,839
|
|
|
—
|
|
|
—
|
|
(1)
|
The Company has adopted a special trust for the Deferred Compensation Plan called a “rabbi trust”. The rabbi trust is an arrangement that is used to accumulate assets that may be used to fund the Company’s obligation to pay benefits under the Deferred Compensation Plan. To prevent immediate taxation to the executives who participate in the Deferred Compensation Plan, the amounts placed in the rabbi trust must remain subject to the claims of the Company’s creditors. The investments chosen by the participants in the Deferred Compensation Plan are mirrored by the rabbi trust as a way to minimize the earnings volatility of the Deferred Compensation Plan.
|
|
As of September 30, 2019
|
|
Fair value measurements at reporting date using:
|
|
Gain (losses) from fair value changes
|
||||||||||||||||||
Quoted prices in
active markets
for identical
assets (Level 1)
|
|
Significant other
observable
inputs (Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
|
Three months ended September 30, 2019
|
|
Nine months ended September 30, 2019
|
|||||||||||||||
(In thousands)
|
|||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Impaired loans (1)
|
$
|
729
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
729
|
|
|
$
|
(388
|
)
|
|
$
|
204
|
|
(1)
|
Collateral-dependent impaired loans held as of September 30, 2019 that had write-downs or recoveries in fair value or whose specific reserve changed during the nine months ended September 30, 2019.
|
|
As of September 30, 2018
|
|
Fair value measurements at reporting date using:
|
|
Gain (losses) from fair value changes
|
||||||||||||||||||
Quoted prices in
active markets
for identical
assets (Level 1)
|
|
Significant other
observable
inputs (Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
|
Three months ended September 30, 2018
|
|
Nine months ended September 30, 2018
|
|||||||||||||||
(In thousands)
|
|||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Impaired loans (1)
|
$
|
2,005
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,005
|
|
|
$
|
(440
|
)
|
|
$
|
(1,367
|
)
|
(1)
|
Collateral-dependent impaired loans held as of September 30, 2018 that had write-downs or recoveries in fair value or whose specific reserve changed during the nine months ended September 30, 2018.
|
|
As of September 30, 2019
|
||||||||||
|
Fair Value
|
|
Valuation
Technique
|
|
Unobservable
Input
|
|
Range of
Inputs
Utilized
|
|
Weighted
Average of
Inputs
Utilized
|
||
|
(In thousands)
|
|
|
||||||||
Impaired Loans
|
$
|
729
|
|
|
Appraisals of Collateral
|
|
Discount for costs to sell
|
|
0% - 6%
|
|
6%
|
Appraisal adjustments
|
|
—%
|
|
—%
|
|
As of September 30, 2018
|
||||||||||
|
Fair Value
|
|
Valuation
Technique
|
|
Unobservable
Input
|
|
Range of
Inputs
Utilized
|
|
Weighted
Average of
Inputs
Utilized
|
||
|
(In thousands)
|
|
|
||||||||
Impaired Loans
|
$
|
2,005
|
|
|
Appraisals of Collateral
|
|
Discount for costs to sell
|
|
0% - 23%
|
|
6%
|
Appraisal adjustments
|
|
—%
|
|
—%
|
|
As of September 30, 2019
|
||||||||||||||||||
Book Value
|
|
Fair Value
|
|
Quoted prices
in active
markets for
identical
assets
(Level 1)
|
|
Significant
other
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
|||||||||||
(In thousands)
|
|||||||||||||||||||
FINANCIAL ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
78,010
|
|
|
$
|
78,010
|
|
|
$
|
78,010
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investment securities held-to-maturity
|
51,379
|
|
|
51,015
|
|
|
—
|
|
|
51,015
|
|
|
—
|
|
|||||
Loans held for sale
|
6,658
|
|
|
6,708
|
|
|
—
|
|
|
6,708
|
|
|
—
|
|
|||||
Loans, net
|
6,991,792
|
|
|
7,006,120
|
|
|
—
|
|
|
—
|
|
|
7,006,120
|
|
|||||
Other financial assets
|
77,614
|
|
|
77,614
|
|
|
—
|
|
|
77,614
|
|
|
—
|
|
|||||
FINANCIAL LIABILITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits
|
6,658,242
|
|
|
6,658,538
|
|
|
—
|
|
|
6,658,538
|
|
|
—
|
|
|||||
Securities sold under agreements to repurchase
|
48,860
|
|
|
48,860
|
|
|
—
|
|
|
48,860
|
|
|
—
|
|
|||||
Federal funds purchased
|
230,000
|
|
|
230,000
|
|
|
—
|
|
|
230,000
|
|
|
—
|
|
|||||
Federal Home Loan Bank borrowings
|
570,904
|
|
|
571,606
|
|
|
—
|
|
|
571,606
|
|
|
—
|
|
|||||
Junior subordinated debentures
|
106,363
|
|
|
96,363
|
|
|
—
|
|
|
—
|
|
|
96,363
|
|
|||||
Other financial liabilities
|
2,730
|
|
|
2,730
|
|
|
—
|
|
|
2,730
|
|
|
—
|
|
|
As of December 31, 2018
|
||||||||||||||||||
Book Value
|
|
Fair Value
|
|
Quoted prices
in active
markets for
identical
assets
(Level 1)
|
|
Significant
other
observable
inputs (Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
|||||||||||
(In thousands)
|
|||||||||||||||||||
FINANCIAL ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
127,259
|
|
|
$
|
127,259
|
|
|
$
|
127,259
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investment securities held-to-maturity
|
70,438
|
|
|
68,595
|
|
|
—
|
|
|
68,595
|
|
|
—
|
|
|||||
Loans held for sale
|
2,812
|
|
|
2,837
|
|
|
—
|
|
|
2,837
|
|
|
—
|
|
|||||
Loans, net
|
6,817,846
|
|
|
6,734,216
|
|
|
—
|
|
|
—
|
|
|
6,734,216
|
|
|||||
Other financial assets
|
78,730
|
|
|
78,730
|
|
|
—
|
|
|
78,730
|
|
|
—
|
|
|||||
FINANCIAL LIABILITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits
|
6,781,170
|
|
|
6,777,928
|
|
|
—
|
|
|
6,777,928
|
|
|
—
|
|
|||||
Securities sold under agreements to repurchase
|
36,928
|
|
|
36,928
|
|
|
—
|
|
|
36,928
|
|
|
—
|
|
|||||
Federal funds purchased
|
250,000
|
|
|
250,000
|
|
|
—
|
|
|
250,000
|
|
|
—
|
|
|||||
Federal Home Loan Bank borrowings
|
420,144
|
|
|
417,092
|
|
|
—
|
|
|
417,092
|
|
|
—
|
|
|||||
Junior subordinated debentures
|
106,363
|
|
|
96,363
|
|
|
—
|
|
|
—
|
|
|
96,363
|
|
|||||
Other financial liabilities
|
2,001
|
|
|
2,001
|
|
|
—
|
|
|
2,001
|
|
|
—
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In thousands)
|
||||||
Commercial and industrial
|
$
|
695,029
|
|
|
$
|
623,037
|
|
Commercial tax-exempt
|
448,488
|
|
|
451,671
|
|
||
Total commercial and industrial
|
1,143,517
|
|
|
1,074,708
|
|
||
Commercial real estate
|
2,533,346
|
|
|
2,395,692
|
|
||
Construction and land
|
209,741
|
|
|
240,306
|
|
||
Residential
|
2,964,042
|
|
|
2,948,973
|
|
||
Home equity
|
84,432
|
|
|
90,421
|
|
||
Consumer and other
|
132,073
|
|
|
143,058
|
|
||
Total
|
$
|
7,067,151
|
|
|
$
|
6,893,158
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In thousands)
|
||||||
Commercial and industrial
|
$
|
800
|
|
|
$
|
2,554
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
||
Total commercial and industrial
|
800
|
|
|
2,554
|
|
||
Commercial real estate
|
—
|
|
|
546
|
|
||
Residential
|
14,219
|
|
|
7,914
|
|
||
Home equity
|
2,545
|
|
|
3,031
|
|
||
Consumer and other
|
1
|
|
|
12
|
|
||
Total
|
$
|
17,565
|
|
|
$
|
14,057
|
|
|
September 30, 2019
|
||||||||||||||||||||||||||||||||||
|
Accruing Past Due
|
|
Nonaccrual Loans
|
|
|
|
|
||||||||||||||||||||||||||||
|
30-59 Days Past Due
|
|
60-89 Days Past Due
|
|
Total Accruing Past Due
|
|
Current
|
|
30-89 Days Past Due
|
|
90 Days or
Greater
Past Due
|
|
Total Non-Accrual Loans
|
|
Current Accruing Loans
|
|
Total
Loans
Receivable
|
||||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||||||||||
Commercial and industrial
|
$
|
554
|
|
|
$
|
2,494
|
|
|
$
|
3,048
|
|
|
$
|
83
|
|
|
$
|
186
|
|
|
$
|
531
|
|
|
$
|
800
|
|
|
$
|
691,181
|
|
|
$
|
695,029
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
448,488
|
|
|
448,488
|
|
|||||||||
Commercial real estate
|
497
|
|
|
—
|
|
|
497
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,532,849
|
|
|
2,533,346
|
|
|||||||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
209,741
|
|
|
209,741
|
|
|||||||||
Residential
|
—
|
|
|
266
|
|
|
266
|
|
|
9,084
|
|
|
301
|
|
|
4,834
|
|
|
14,219
|
|
|
2,949,557
|
|
|
2,964,042
|
|
|||||||||
Home equity
|
74
|
|
|
279
|
|
|
353
|
|
|
991
|
|
|
—
|
|
|
1,554
|
|
|
2,545
|
|
|
81,534
|
|
|
84,432
|
|
|||||||||
Consumer and other
|
15
|
|
|
—
|
|
|
15
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
132,057
|
|
|
132,073
|
|
|||||||||
Total
|
$
|
1,140
|
|
|
$
|
3,039
|
|
|
$
|
4,179
|
|
|
$
|
10,159
|
|
|
$
|
487
|
|
|
$
|
6,919
|
|
|
$
|
17,565
|
|
|
$
|
7,045,407
|
|
|
$
|
7,067,151
|
|
|
December 31, 2018
|
||||||||||||||||||||||||||||||||||
|
Accruing Past Due
|
|
Nonaccrual Loans
|
|
|
|
|
||||||||||||||||||||||||||||
|
30-59 Days Past Due
|
|
60-89 Days Past Due
|
|
Total Accruing Past Due
|
|
Current
|
|
30-89 Days Past Due
|
|
90 Days or Greater Past Due
|
|
Total Non-Accrual Loans
|
|
Current Accruing Loans
|
|
Total Loans Receivable
|
||||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||||||||||
Commercial and industrial
|
$
|
9,794
|
|
|
$
|
—
|
|
|
$
|
9,794
|
|
|
$
|
979
|
|
|
$
|
—
|
|
|
$
|
1,575
|
|
|
$
|
2,554
|
|
|
$
|
610,689
|
|
|
$
|
623,037
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
451,671
|
|
|
451,671
|
|
|||||||||
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
546
|
|
|
546
|
|
|
2,395,146
|
|
|
2,395,692
|
|
|||||||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
240,306
|
|
|
240,306
|
|
|||||||||
Residential
|
6,477
|
|
|
366
|
|
|
6,843
|
|
|
2,639
|
|
|
716
|
|
|
4,559
|
|
|
7,914
|
|
|
2,934,216
|
|
|
2,948,973
|
|
|||||||||
Home equity
|
252
|
|
|
350
|
|
|
602
|
|
|
—
|
|
|
48
|
|
|
2,983
|
|
|
3,031
|
|
|
86,788
|
|
|
90,421
|
|
|||||||||
Consumer and other
|
17
|
|
|
5,043
|
|
|
5,060
|
|
|
8
|
|
|
4
|
|
|
—
|
|
|
12
|
|
|
137,986
|
|
|
143,058
|
|
|||||||||
Total
|
$
|
16,540
|
|
|
$
|
5,759
|
|
|
$
|
22,299
|
|
|
$
|
3,626
|
|
|
$
|
768
|
|
|
$
|
9,663
|
|
|
$
|
14,057
|
|
|
$
|
6,856,802
|
|
|
$
|
6,893,158
|
|
|
September 30, 2019
|
||||||||||||||||||
|
By Loan Grade or Nonaccrual Status
|
|
|
||||||||||||||||
|
Pass
|
|
Special
Mention
|
|
Accruing
Classified (1)
|
|
Nonaccrual
Loans
|
|
Total
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Commercial and industrial
|
$
|
656,012
|
|
|
$
|
13,084
|
|
|
$
|
25,133
|
|
|
$
|
800
|
|
|
$
|
695,029
|
|
Commercial tax-exempt
|
441,811
|
|
|
2,625
|
|
|
4,052
|
|
|
—
|
|
|
448,488
|
|
|||||
Commercial real estate
|
2,460,408
|
|
|
42,124
|
|
|
30,814
|
|
|
—
|
|
|
2,533,346
|
|
|||||
Construction and land
|
209,741
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
209,741
|
|
|||||
Residential
|
2,946,823
|
|
|
—
|
|
|
3,000
|
|
|
14,219
|
|
|
2,964,042
|
|
|||||
Home equity
|
81,308
|
|
|
300
|
|
|
279
|
|
|
2,545
|
|
|
84,432
|
|
|||||
Consumer and other
|
132,072
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
132,073
|
|
|||||
Total
|
$
|
6,928,175
|
|
|
$
|
58,133
|
|
|
$
|
63,278
|
|
|
$
|
17,565
|
|
|
$
|
7,067,151
|
|
|
December 31, 2018
|
||||||||||||||||||
|
By Loan Grade or Nonaccrual Status
|
|
|
||||||||||||||||
|
Pass
|
|
Special
Mention |
|
Accruing
Classified (1) |
|
Nonaccrual
Loans |
|
Total
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Commercial and industrial
|
$
|
581,278
|
|
|
$
|
16,213
|
|
|
$
|
22,992
|
|
|
$
|
2,554
|
|
|
$
|
623,037
|
|
Commercial tax-exempt
|
444,835
|
|
|
2,785
|
|
|
4,051
|
|
|
—
|
|
|
451,671
|
|
|||||
Commercial real estate
|
2,314,223
|
|
|
53,871
|
|
|
27,052
|
|
|
546
|
|
|
2,395,692
|
|
|||||
Construction and land
|
234,647
|
|
|
5,659
|
|
|
—
|
|
|
—
|
|
|
240,306
|
|
|||||
Residential
|
2,941,059
|
|
|
—
|
|
|
—
|
|
|
7,914
|
|
|
2,948,973
|
|
|||||
Home equity
|
87,390
|
|
|
—
|
|
|
—
|
|
|
3,031
|
|
|
90,421
|
|
|||||
Consumer and other
|
143,046
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
143,058
|
|
|||||
Total
|
$
|
6,746,478
|
|
|
$
|
78,528
|
|
|
$
|
54,095
|
|
|
$
|
14,057
|
|
|
$
|
6,893,158
|
|
(1)
|
Accruing Classified includes both Substandard and Doubtful classifications.
|
|
As of and for the three and nine months ended September 30, 2019
|
||||||||||||||||||||||||||
|
Recorded Investment (1)
|
|
Unpaid Principal Balance
|
|
Related Allowance
|
|
QTD Average Recorded Investment
|
|
YTD Average Recorded Investment
|
|
QTD Interest Income Recognized while Impaired
|
|
YTD Interest Income Recognized while Impaired
|
||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial and industrial
|
$
|
479
|
|
|
$
|
788
|
|
|
n/a
|
|
|
$
|
1,233
|
|
|
$
|
1,256
|
|
|
$
|
192
|
|
|
$
|
217
|
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commercial real estate
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
55
|
|
|
—
|
|
|
256
|
|
|||||||
Construction and land
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Residential
|
14,879
|
|
|
15,140
|
|
|
n/a
|
|
|
15,026
|
|
|
13,321
|
|
|
236
|
|
|
476
|
|
|||||||
Home equity
|
2,313
|
|
|
2,995
|
|
|
n/a
|
|
|
2,359
|
|
|
2,106
|
|
|
12
|
|
|
13
|
|
|||||||
Consumer and other
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Subtotal
|
$
|
17,671
|
|
|
$
|
18,923
|
|
|
n/a
|
|
|
18,618
|
|
|
$
|
16,738
|
|
|
440
|
|
|
$
|
962
|
|
|||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial and industrial
|
$
|
538
|
|
|
$
|
539
|
|
|
$
|
341
|
|
|
491
|
|
|
$
|
877
|
|
|
3
|
|
|
$
|
23
|
|
||
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Residential
|
2,059
|
|
|
2,059
|
|
|
712
|
|
|
1,419
|
|
|
1,017
|
|
|
5
|
|
|
18
|
|
|||||||
Home equity
|
279
|
|
|
279
|
|
|
23
|
|
|
276
|
|
|
626
|
|
|
1
|
|
|
2
|
|
|||||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Subtotal
|
$
|
2,876
|
|
|
$
|
2,877
|
|
|
$
|
1,076
|
|
|
$
|
2,186
|
|
|
$
|
2,520
|
|
|
$
|
9
|
|
|
$
|
43
|
|
Total:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial and industrial
|
$
|
1,017
|
|
|
$
|
1,327
|
|
|
$
|
341
|
|
|
$
|
1,724
|
|
|
$
|
2,133
|
|
|
$
|
195
|
|
|
$
|
240
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
55
|
|
|
—
|
|
|
256
|
|
|||||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Residential
|
16,938
|
|
|
17,199
|
|
|
712
|
|
|
16,445
|
|
|
14,338
|
|
|
241
|
|
|
494
|
|
|||||||
Home equity
|
2,592
|
|
|
3,274
|
|
|
23
|
|
|
2,635
|
|
|
2,732
|
|
|
13
|
|
|
15
|
|
|||||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total
|
$
|
20,547
|
|
|
$
|
21,800
|
|
|
$
|
1,076
|
|
|
$
|
20,804
|
|
|
$
|
19,258
|
|
|
$
|
449
|
|
|
$
|
1,005
|
|
(1)
|
Recorded investment represents the client loan balance net of historical charge-offs and historical nonaccrual interest paid, if applicable, which was applied to principal.
|
|
As of and for the three and nine months ended September 30, 2018
|
||||||||||||||||||||||||||
|
Recorded Investment (1)
|
|
Unpaid Principal Balance
|
|
Related Allowance
|
|
QTD Average Recorded Investment
|
|
YTD Average Recorded Investment
|
|
QTD Interest Income Recognized while Impaired
|
|
YTD Interest Income Recognized while Impaired
|
||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial and industrial
|
$
|
1,150
|
|
|
$
|
2,083
|
|
|
n/a
|
|
|
$
|
1,617
|
|
|
$
|
1,730
|
|
|
$
|
33
|
|
|
$
|
55
|
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commercial real estate
|
1,625
|
|
|
2,966
|
|
|
n/a
|
|
|
2,526
|
|
|
2,439
|
|
|
583
|
|
|
633
|
|
|||||||
Construction and land
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
66
|
|
|
—
|
|
|
16
|
|
|||||||
Residential
|
7,097
|
|
|
7,457
|
|
|
n/a
|
|
|
10,102
|
|
|
10,002
|
|
|
146
|
|
|
335
|
|
|||||||
Home equity
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
1,056
|
|
|
—
|
|
|
24
|
|
|||||||
Consumer and other
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Subtotal
|
$
|
9,872
|
|
|
$
|
12,506
|
|
|
n/a
|
|
|
$
|
14,245
|
|
|
$
|
15,293
|
|
|
$
|
762
|
|
|
$
|
1,063
|
|
|
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial and industrial
|
$
|
1,635
|
|
|
$
|
1,638
|
|
|
$
|
577
|
|
|
$
|
625
|
|
|
$
|
322
|
|
|
$
|
4
|
|
|
$
|
6
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
4,045
|
|
|
5,314
|
|
|
476
|
|
|
704
|
|
|||||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Residential
|
682
|
|
|
681
|
|
|
74
|
|
|
734
|
|
|
787
|
|
|
5
|
|
|
17
|
|
|||||||
Home equity
|
1,769
|
|
|
1,769
|
|
|
596
|
|
|
1,769
|
|
|
729
|
|
|
1
|
|
|
1
|
|
|||||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
3
|
|
|||||||
Subtotal
|
$
|
4,086
|
|
|
$
|
4,088
|
|
|
$
|
1,247
|
|
|
$
|
7,173
|
|
|
$
|
7,165
|
|
|
$
|
486
|
|
|
$
|
731
|
|
Total:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial and industrial
|
$
|
2,785
|
|
|
$
|
3,721
|
|
|
$
|
577
|
|
|
$
|
2,242
|
|
|
$
|
2,052
|
|
|
$
|
37
|
|
|
$
|
61
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commercial real estate
|
1,625
|
|
|
2,966
|
|
|
—
|
|
|
6,571
|
|
|
7,753
|
|
|
1,059
|
|
|
1,337
|
|
|||||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
|
—
|
|
|
16
|
|
|||||||
Residential
|
7,779
|
|
|
8,138
|
|
|
74
|
|
|
10,836
|
|
|
10,789
|
|
|
151
|
|
|
352
|
|
|||||||
Home equity
|
1,769
|
|
|
1,769
|
|
|
596
|
|
|
1,769
|
|
|
1,785
|
|
|
1
|
|
|
25
|
|
|||||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
3
|
|
|||||||
Total
|
$
|
13,958
|
|
|
$
|
16,594
|
|
|
$
|
1,247
|
|
|
$
|
21,418
|
|
|
$
|
22,458
|
|
|
$
|
1,248
|
|
|
$
|
1,794
|
|
(1)
|
Recorded investment represents the client loan balance net of historical charge-offs and historical nonaccrual interest paid, if applicable, which was applied to principal.
|
|
As of and for the year ended December 31, 2018
|
||||||||||||||||||
|
Recorded Investment (1)
|
|
Unpaid Principal Balance
|
|
Related Allowance
|
|
Average Recorded Investment
|
|
Interest Income Recognized while Impaired
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial
|
$
|
1,435
|
|
|
$
|
2,397
|
|
|
n/a
|
|
|
$
|
1,614
|
|
|
$
|
69
|
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
—
|
|
|||||
Commercial real estate
|
546
|
|
|
900
|
|
|
n/a
|
|
|
2,002
|
|
|
1,544
|
|
|||||
Construction and land
|
—
|
|
|
—
|
|
|
n/a
|
|
|
50
|
|
|
16
|
|
|||||
Residential
|
8,403
|
|
|
8,764
|
|
|
n/a
|
|
|
9,638
|
|
|
408
|
|
|||||
Home equity
|
990
|
|
|
990
|
|
|
n/a
|
|
|
1,041
|
|
|
24
|
|
|||||
Consumer and other
|
—
|
|
|
—
|
|
|
n/a
|
|
|
—
|
|
|
—
|
|
|||||
Subtotal
|
$
|
11,374
|
|
|
$
|
13,051
|
|
|
n/a
|
|
|
$
|
14,345
|
|
|
$
|
2,061
|
|
|
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial
|
$
|
1,770
|
|
|
$
|
1,972
|
|
|
$
|
598
|
|
|
$
|
631
|
|
|
$
|
15
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
4,087
|
|
|
705
|
|
|||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Residential
|
780
|
|
|
780
|
|
|
75
|
|
|
785
|
|
|
22
|
|
|||||
Home equity
|
1,719
|
|
|
1,719
|
|
|
562
|
|
|
959
|
|
|
11
|
|
|||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|
3
|
|
|||||
Subtotal
|
$
|
4,269
|
|
|
$
|
4,471
|
|
|
$
|
1,235
|
|
|
$
|
6,472
|
|
|
$
|
756
|
|
Total:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial
|
$
|
3,205
|
|
|
$
|
4,369
|
|
|
$
|
598
|
|
|
$
|
2,245
|
|
|
$
|
84
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Commercial real estate
|
546
|
|
|
900
|
|
|
—
|
|
|
6,089
|
|
|
2,249
|
|
|||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
50
|
|
|
16
|
|
|||||
Residential
|
9,183
|
|
|
9,544
|
|
|
75
|
|
|
10,423
|
|
|
430
|
|
|||||
Home equity
|
2,709
|
|
|
2,709
|
|
|
562
|
|
|
2,000
|
|
|
35
|
|
|||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|
3
|
|
|||||
Total
|
$
|
15,643
|
|
|
$
|
17,522
|
|
|
$
|
1,235
|
|
|
$
|
20,817
|
|
|
$
|
2,817
|
|
(1)
|
Recorded investment represents the client loan balance net of historical charge-offs and historical nonaccrual interest paid, if applicable, which was applied to principal.
|
|
As of and for the nine months ended September 30, 2019
|
||||||||||||||||
|
Restructured Year to Date
|
|
TDRs that defaulted in the Year to Date that were restructured
in prior twelve months
|
||||||||||||||
|
# of
Loans
|
|
Pre-
modification
recorded
investment
|
|
Post-
modification
recorded
investment
|
|
# of
Loans
|
|
Post-
modification
recorded
investment
|
||||||||
|
(In thousands, except number of loans)
|
||||||||||||||||
Commercial and industrial
|
1
|
|
|
$
|
179
|
|
|
$
|
179
|
|
|
—
|
|
|
$
|
—
|
|
Commercial tax exempt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Residential (1)
|
2
|
|
|
3,222
|
|
|
3,227
|
|
|
—
|
|
|
—
|
|
|||
Home equity (1)
|
1
|
|
|
274
|
|
|
283
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
4
|
|
|
$
|
3,675
|
|
|
$
|
3,689
|
|
|
—
|
|
|
$
|
—
|
|
|
As of and for the three and nine months ended September 30, 2019
|
|||||||||||||||||||||||||||||||||
|
Extension of term
|
|
Temporary rate reduction
|
|
Payment deferral
|
|
Combination of concessions (1)
|
|
Total concessions
|
|||||||||||||||||||||||||
|
# of
Loans |
|
Post-
modifi-
cation
recorded invest-
ment
|
|
# of
Loans |
|
Post-
modifi- cation recorded invest- ment |
|
# of
Loans |
|
Post-
modifi- cation recorded invest- ment |
|
# of
Loans |
|
Post-
modifi- cation recorded invest- ment |
|
# of
Loans |
|
Post-
modifi- cation recorded invest- ment |
|||||||||||||||
|
(In thousands, except number of loans)
|
|||||||||||||||||||||||||||||||||
Commercial and industrial
|
1
|
|
|
$
|
179
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
1
|
|
|
$
|
179
|
|
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Residential
|
—
|
|
|
—
|
|
|
2
|
|
|
3,227
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
3,227
|
|
|||||
Home equity
|
—
|
|
|
—
|
|
|
1
|
|
|
283
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
283
|
|
|||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In thousands)
|
||||||
Commercial and industrial
|
$
|
14,358
|
|
|
$
|
8,024
|
|
Commercial tax-exempt
|
18,711
|
|
|
19,105
|
|
||
Commercial real estate
|
34,816
|
|
|
60,688
|
|
||
Construction and land
|
23,133
|
|
|
39,966
|
|
||
Total loan participations serviced for others
|
$
|
91,018
|
|
|
$
|
127,783
|
|
|
|
|
|
||||
Residential
|
$
|
119,389
|
|
|
$
|
33,168
|
|
Total loans serviced for others
|
$
|
119,389
|
|
|
$
|
33,168
|
|
|
As of and for the three months ended September 30,
|
|
As of and for the nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In thousands)
|
||||||||||||||
Allowance for loan losses, beginning of period:
|
|
|
|
|
|
|
|
||||||||
Commercial and industrial
|
$
|
16,082
|
|
|
$
|
12,381
|
|
|
$
|
15,912
|
|
|
$
|
11,735
|
|
Commercial real estate
|
43,741
|
|
|
45,183
|
|
|
41,934
|
|
|
46,820
|
|
||||
Construction and land
|
4,780
|
|
|
4,613
|
|
|
6,022
|
|
|
4,949
|
|
||||
Residential
|
9,555
|
|
|
9,804
|
|
|
10,026
|
|
|
9,773
|
|
||||
Home equity
|
805
|
|
|
1,336
|
|
|
1,284
|
|
|
835
|
|
||||
Consumer and other
|
104
|
|
|
147
|
|
|
134
|
|
|
630
|
|
||||
Total allowance for loan losses, beginning of period
|
75,067
|
|
|
73,464
|
|
|
75,312
|
|
|
74,742
|
|
||||
Loans charged-off:
|
|
|
|
|
|
|
|
||||||||
Commercial and industrial
|
(180
|
)
|
|
—
|
|
|
(375
|
)
|
|
(339
|
)
|
||||
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
(135
|
)
|
||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Residential
|
—
|
|
|
—
|
|
|
—
|
|
|
(16
|
)
|
||||
Home equity
|
—
|
|
|
—
|
|
|
(562
|
)
|
|
—
|
|
||||
Consumer and other
|
(5
|
)
|
|
—
|
|
|
(7
|
)
|
|
(39
|
)
|
||||
Total charge-offs
|
(185
|
)
|
|
—
|
|
|
(944
|
)
|
|
(529
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Recoveries on loans previously charged-off:
|
|
|
|
|
|
|
|
||||||||
Commercial and industrial
|
275
|
|
|
153
|
|
|
503
|
|
|
387
|
|
||||
Commercial real estate
|
27
|
|
|
820
|
|
|
246
|
|
|
995
|
|
||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Residential
|
—
|
|
|
—
|
|
|
100
|
|
|
27
|
|
||||
Home equity
|
6
|
|
|
—
|
|
|
6
|
|
|
1
|
|
||||
Consumer and other
|
2
|
|
|
12
|
|
|
32
|
|
|
168
|
|
||||
Total recoveries
|
310
|
|
|
985
|
|
|
887
|
|
|
1,578
|
|
||||
Provision/ (credit) for loan losses:
|
|
|
|
|
|
|
|
||||||||
Commercial and industrial
|
361
|
|
|
1,921
|
|
|
498
|
|
|
2,672
|
|
||||
Commercial real estate
|
(762
|
)
|
|
(3,179
|
)
|
|
826
|
|
|
(4,856
|
)
|
||||
Construction and land
|
6
|
|
|
172
|
|
|
(1,236
|
)
|
|
(164
|
)
|
||||
Residential
|
617
|
|
|
144
|
|
|
46
|
|
|
164
|
|
||||
Home equity
|
(57
|
)
|
|
6
|
|
|
26
|
|
|
506
|
|
||||
Consumer and other
|
2
|
|
|
(13
|
)
|
|
(56
|
)
|
|
(613
|
)
|
||||
Total provision/(credit) for loan losses
|
167
|
|
|
(949
|
)
|
|
104
|
|
|
(2,291
|
)
|
|
As of and for the three months ended September 30,
|
|
As of and for the nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In thousands)
|
||||||||||||||
Allowance for loan losses, end of period:
|
|
|
|
|
|
|
|
||||||||
Commercial and industrial
|
16,538
|
|
|
14,455
|
|
|
16,538
|
|
|
14,455
|
|
||||
Commercial real estate
|
43,006
|
|
|
42,824
|
|
|
43,006
|
|
|
42,824
|
|
||||
Construction and land
|
4,786
|
|
|
4,785
|
|
|
4,786
|
|
|
4,785
|
|
||||
Residential
|
10,172
|
|
|
9,948
|
|
|
10,172
|
|
|
9,948
|
|
||||
Home equity
|
754
|
|
|
1,342
|
|
|
754
|
|
|
1,342
|
|
||||
Consumer and other
|
103
|
|
|
146
|
|
|
103
|
|
|
146
|
|
||||
Total allowance for loan losses, end of period
|
$
|
75,359
|
|
|
$
|
73,500
|
|
|
$
|
75,359
|
|
|
$
|
73,500
|
|
|
September 30, 2019
|
||||||||||||||||||||||
|
Individually Evaluated
for Impairment
|
|
Collectively Evaluated
for Impairment
|
|
Total
|
||||||||||||||||||
|
Recorded investment
(loan balance)
|
|
Allowance for loan losses
|
|
Recorded investment
(loan balance)
|
|
Allowance for loan losses
|
|
Recorded investment
(loan balance)
|
|
Allowance for loan losses
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
1,017
|
|
|
$
|
341
|
|
|
$
|
1,142,500
|
|
|
$
|
16,197
|
|
|
$
|
1,143,517
|
|
|
$
|
16,538
|
|
Commercial real estate
|
—
|
|
|
—
|
|
|
2,533,346
|
|
|
43,006
|
|
|
2,533,346
|
|
|
43,006
|
|
||||||
Construction and land
|
—
|
|
|
—
|
|
|
209,741
|
|
|
4,786
|
|
|
209,741
|
|
|
4,786
|
|
||||||
Residential
|
16,938
|
|
|
712
|
|
|
2,947,104
|
|
|
9,460
|
|
|
2,964,042
|
|
|
10,172
|
|
||||||
Home equity
|
2,592
|
|
|
23
|
|
|
81,840
|
|
|
731
|
|
|
84,432
|
|
|
754
|
|
||||||
Consumer and other
|
—
|
|
|
—
|
|
|
132,073
|
|
|
103
|
|
|
132,073
|
|
|
103
|
|
||||||
Total
|
$
|
20,547
|
|
|
$
|
1,076
|
|
|
$
|
7,046,604
|
|
|
$
|
74,283
|
|
|
$
|
7,067,151
|
|
|
$
|
75,359
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
Individually Evaluated
for Impairment
|
|
Collectively Evaluated
for Impairment
|
|
Total
|
||||||||||||||||||
|
Recorded investment
(loan balance)
|
|
Allowance for loan losses
|
|
Recorded investment
(loan balance)
|
|
Allowance for loan losses
|
|
Recorded investment
(loan balance)
|
|
Allowance for loan losses
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
3,205
|
|
|
$
|
598
|
|
|
$
|
1,071,503
|
|
|
$
|
15,314
|
|
|
$
|
1,074,708
|
|
|
$
|
15,912
|
|
Commercial real estate
|
546
|
|
|
—
|
|
|
2,395,146
|
|
|
41,934
|
|
|
2,395,692
|
|
|
41,934
|
|
||||||
Construction and land
|
—
|
|
|
—
|
|
|
240,306
|
|
|
6,022
|
|
|
240,306
|
|
|
6,022
|
|
||||||
Residential
|
9,183
|
|
|
75
|
|
|
2,939,790
|
|
|
9,951
|
|
|
2,948,973
|
|
|
10,026
|
|
||||||
Home equity
|
2,709
|
|
|
562
|
|
|
87,712
|
|
|
722
|
|
|
90,421
|
|
|
1,284
|
|
||||||
Consumer and other
|
—
|
|
|
—
|
|
|
143,058
|
|
|
134
|
|
|
143,058
|
|
|
134
|
|
||||||
Total
|
$
|
15,643
|
|
|
$
|
1,235
|
|
|
$
|
6,877,515
|
|
|
$
|
74,077
|
|
|
$
|
6,893,158
|
|
|
$
|
75,312
|
|
(1)
|
For additional details, see Part I. Item 1. “Notes to Unaudited Consolidated Financial Statements - Note 5: Fair Value Measurements”.
|
Derivatives in cash
flow hedging
relationships
|
|
Amount of gain or (loss) recognized in OCI on derivatives
|
|
Location of gain
or (loss) reclassified
from accumulated
OCI into income
|
|
Amount of gain or (loss) reclassified from accumulated OCI into income
|
||||||||||||
|
Three months ended September 30,
|
|
|
Three months ended September 30,
|
||||||||||||||
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
||||||||||
|
|
(In thousands)
|
|
|
|
(In thousands)
|
||||||||||||
Interest rate swaps
|
|
$
|
1
|
|
|
$
|
(193
|
)
|
|
Interest expense
|
|
$
|
6
|
|
|
$
|
101
|
|
Total
|
|
$
|
1
|
|
|
$
|
(193
|
)
|
|
|
|
$
|
6
|
|
|
$
|
101
|
|
Derivatives in cash
flow hedging relationships |
|
Amount of gain or (loss) recognized in OCI on derivatives (1)
|
|
Location of gain
or (loss) reclassified from accumulated OCI into income |
|
Amount of gain or (loss) reclassified from accumulated OCI into income
|
||||||||||||
|
Nine months ended September 30,
|
|
|
Nine months ended September 30,
|
||||||||||||||
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
||||||||||
|
|
(In thousands)
|
|
|
|
(In thousands)
|
||||||||||||
Interest rate swaps
|
|
$
|
(46
|
)
|
|
$
|
818
|
|
|
Interest expense
|
|
$
|
508
|
|
|
$
|
385
|
|
Total
|
|
$
|
(46
|
)
|
|
$
|
818
|
|
|
|
|
$
|
508
|
|
|
$
|
385
|
|
(1)
|
The guidance in ASU 2017-12 requires that amounts in accumulated other comprehensive income that are included in the assessment of effectiveness should be reclassified into earnings in the same period in which the hedged forecasted transactions impact earnings. Transition guidance for this ASU further states that upon adoption, previously recorded cumulative ineffectiveness for cash flow hedges existing at the adoption date be eliminated by means of a cumulative-effect adjustment to accumulated other comprehensive income with a corresponding adjustment to the opening balance of retained earnings as of the initial application date. There was a $5 thousand reclassification related to the adoption of ASU 2017-12 effective January 1, 2018.
|
|
Location of gain or (loss) reclassified from accumulated
OCI into income
|
Amount of gain or
(loss) recognized in income on cash flow hedging relationships |
|
Amount of gain or
(loss) recognized in
income on cash flow
hedging relationships
|
||||||||||||
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||||
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
|
|
(In thousands)
|
||||||||||||||
Total amounts of income and (expense) line items presented in the statement of operations in which the effects of fair value or cash flow hedges are recorded
|
Interest expense
|
$
|
6
|
|
|
$
|
101
|
|
|
$
|
508
|
|
|
$
|
385
|
|
The effects of cash flow hedging:
|
|
|
|
|
|
|
|
|
||||||||
Gain or (loss) on cash flow hedging relationships
in ASC 815
|
|
|
|
|
|
|
|
|
||||||||
Interest contracts - amount of gain or (loss) reclassified from accumulated other comprehensive income into income
|
Interest expense
|
$
|
6
|
|
|
$
|
101
|
|
|
$
|
508
|
|
|
$
|
385
|
|
|
|
|
|
Amount of gain or (loss), net,
recognized in income on derivatives
|
||||||||||||||
Derivatives not designated as
hedging instruments
|
|
Location of gain or (loss) recognized in income on derivatives
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|||||||||||
|
|
|
|
(In thousands)
|
||||||||||||||
Interest rate swaps
|
|
Other income/ (expense)
|
|
$
|
(289
|
)
|
|
$
|
8
|
|
|
$
|
(544
|
)
|
|
$
|
(39
|
)
|
Risk participation agreements
|
|
Other income/ (expense)
|
|
(11
|
)
|
|
18
|
|
|
(120
|
)
|
|
238
|
|
||||
Total
|
|
|
|
$
|
(300
|
)
|
|
$
|
26
|
|
|
$
|
(664
|
)
|
|
$
|
199
|
|
|
Nine months ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In thousands)
|
||||||
Income from continuing operations:
|
|
|
|
||||
Income before income taxes
|
$
|
74,852
|
|
|
$
|
77,214
|
|
Income tax expense
|
15,803
|
|
|
28,886
|
|
||
Net income from continuing operations
|
$
|
59,049
|
|
|
$
|
48,328
|
|
Effective tax rate, continuing operations
|
21.1
|
%
|
|
37.4
|
%
|
||
|
|
|
|
||||
Income from discontinued operations:
|
|
|
|
||||
Income before income taxes
|
$
|
—
|
|
|
$
|
2,388
|
|
Income tax expense
|
—
|
|
|
692
|
|
||
Net income from discontinued operations
|
$
|
—
|
|
|
$
|
1,696
|
|
Effective tax rate, discontinued operations
|
—
|
%
|
|
29.0
|
%
|
||
|
|
|
|
||||
Less: Income attributable to noncontrolling interests:
|
|
|
|
||||
Income before income taxes
|
$
|
265
|
|
|
$
|
2,942
|
|
Income tax expense
|
—
|
|
|
—
|
|
||
Net income attributable to noncontrolling interests
|
$
|
265
|
|
|
$
|
2,942
|
|
Effective tax rate, noncontrolling interests
|
—
|
%
|
|
—
|
%
|
||
|
|
|
|
||||
Income attributable to the Company
|
|
|
|
||||
Income before income taxes
|
$
|
74,587
|
|
|
$
|
76,660
|
|
Income tax expense
|
15,803
|
|
|
29,578
|
|
||
Net income attributable to the Company
|
$
|
58,784
|
|
|
$
|
47,082
|
|
Effective tax rate attributable to the Company
|
21.2
|
%
|
|
38.6
|
%
|
|
Three months ended
|
|
Nine months ended
|
||||
|
September 30, 2019
|
|
September 30, 2019
|
||||
|
Redeemable noncontrolling interests
|
|
Redeemable noncontrolling interests
|
||||
|
(In thousands)
|
||||||
Noncontrolling interests at beginning of period
|
$
|
1,786
|
|
|
$
|
2,526
|
|
Net income attributable to noncontrolling interests
|
96
|
|
|
265
|
|
||
Distributions
|
(96
|
)
|
|
(265
|
)
|
||
Purchases/ (sales) of ownership interests
|
—
|
|
|
12
|
|
||
Amortization of equity compensation
|
10
|
|
|
36
|
|
||
Adjustments to fair value
|
(315
|
)
|
|
(1,093
|
)
|
||
Noncontrolling interests at end of period
|
$
|
1,481
|
|
|
$
|
1,481
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
September 30, 2018
|
|
September 30, 2018
|
||||||||||||
|
Redeemable noncontrolling interests
|
|
Noncontrolling interests
|
|
Redeemable noncontrolling interests
|
|
Noncontrolling interests
|
||||||||
|
(In thousands)
|
||||||||||||||
Noncontrolling interests at beginning of period
|
$
|
10,747
|
|
|
$
|
1,996
|
|
|
$
|
17,461
|
|
|
$
|
5,186
|
|
Net income attributable to noncontrolling interests
|
711
|
|
|
213
|
|
|
2,202
|
|
|
740
|
|
||||
Distributions
|
(687
|
)
|
|
(203
|
)
|
|
(2,136
|
)
|
|
(712
|
)
|
||||
Purchases/ (sales) of ownership interests
|
—
|
|
|
—
|
|
|
(6,353
|
)
|
|
(3,051
|
)
|
||||
Amortization of equity compensation
|
125
|
|
|
—
|
|
|
373
|
|
|
161
|
|
||||
Adjustments to fair value
|
790
|
|
|
203
|
|
|
139
|
|
|
(115
|
)
|
||||
Noncontrolling interests at end of period
|
$
|
11,686
|
|
|
$
|
2,209
|
|
|
$
|
11,686
|
|
|
$
|
2,209
|
|
Description of component of accumulated other comprehensive income/ (loss)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
|
Affected line item in
Statement of Operations
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
||||||||||
|
|
(In thousands)
|
|
(In thousands)
|
|
|
||||||||||||
Net realized gain/ (loss) on cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Hedges related to deposits and borrowings:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Pre-tax gain/ (loss)
|
|
$
|
6
|
|
|
$
|
101
|
|
|
$
|
508
|
|
|
$
|
385
|
|
|
Interest (expense)
|
Tax (expense)/ benefit
|
|
(2
|
)
|
|
(29
|
)
|
|
(148
|
)
|
|
(112
|
)
|
|
Income tax (expense)/ benefit
|
||||
Net
|
|
$
|
4
|
|
|
$
|
72
|
|
|
$
|
360
|
|
|
$
|
273
|
|
|
Net income/ (loss) attributable to the Company
|
Total reclassifications for the period, net of tax
|
|
$
|
4
|
|
|
$
|
72
|
|
|
$
|
360
|
|
|
$
|
273
|
|
|
|
|
Components of accumulated other comprehensive income/ (loss)
|
|
|
||||||||||||
|
Unrealized
gain/ (loss)
on securities
available-for-sale
|
|
Unrealized
gain/ (loss)
on cash flow
hedges
|
|
Unrealized
gain/ (loss)
on other
|
|
Accumulated
other
comprehensive
income/ (loss)
|
||||||||
|
(In thousands)
|
||||||||||||||
Balance at December 31, 2017
|
$
|
(8,140
|
)
|
|
$
|
332
|
|
|
$
|
(850
|
)
|
|
$
|
(8,658
|
)
|
Other comprehensive income/ (loss) before reclassifications
|
(18,888
|
)
|
|
574
|
|
|
1
|
|
|
(18,313
|
)
|
||||
Reclassified from other comprehensive income/ (loss)
|
—
|
|
|
(273
|
)
|
|
—
|
|
|
(273
|
)
|
||||
Other comprehensive income/ (loss), net
|
(18,888
|
)
|
|
301
|
|
|
1
|
|
|
(18,586
|
)
|
||||
Reclassification from the adoption of ASUs 2017-12 and 2016-01
|
$
|
(339
|
)
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
(334
|
)
|
Balance at September 30, 2018
|
$
|
(27,367
|
)
|
|
$
|
638
|
|
|
$
|
(849
|
)
|
|
$
|
(27,578
|
)
|
|
|
|
|
|
|
|
|
||||||||
Balance at December 31, 2018
|
$
|
(17,556
|
)
|
|
$
|
391
|
|
|
$
|
(554
|
)
|
|
$
|
(17,719
|
)
|
Other comprehensive income/ (loss) before reclassifications
|
27,469
|
|
|
(31
|
)
|
|
—
|
|
|
27,438
|
|
||||
Reclassified from other comprehensive income/ (loss)
|
—
|
|
|
(360
|
)
|
|
—
|
|
|
(360
|
)
|
||||
Other comprehensive income/ (loss), net
|
27,469
|
|
|
(391
|
)
|
|
—
|
|
|
27,078
|
|
||||
Balance at September 30, 2019
|
$
|
9,913
|
|
|
$
|
—
|
|
|
$
|
(554
|
)
|
|
$
|
9,359
|
|
|
Severance Charges
|
|
Other Associated Costs
|
|
Total
|
||||||
|
(In thousands)
|
||||||||||
Accrued charges at December 31, 2018
|
$
|
3,896
|
|
|
$
|
790
|
|
|
$
|
4,686
|
|
Cost incurred
|
1,646
|
|
|
—
|
|
|
1,646
|
|
|||
Costs paid
|
(1,986
|
)
|
|
—
|
|
|
(1,986
|
)
|
|||
Accrued charges at March 31, 2019
|
3,556
|
|
|
790
|
|
|
4,346
|
|
|||
Costs paid
|
(1,364
|
)
|
|
—
|
|
|
(1,364
|
)
|
|||
Accrued charges at June 30, 2019
|
2,192
|
|
|
790
|
|
|
2,982
|
|
|||
Costs paid
|
(1,156
|
)
|
|
—
|
|
|
(1,156
|
)
|
|||
Accrued charges at September 30, 2019
|
$
|
1,036
|
|
|
$
|
790
|
|
|
$
|
1,826
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Accrued charges at December 31, 2017
|
$
|
337
|
|
|
$
|
—
|
|
|
$
|
337
|
|
Costs paid
|
(254
|
)
|
|
—
|
|
|
(254
|
)
|
|||
Accrued charges at March 31, 2018
|
83
|
|
|
—
|
|
|
83
|
|
|||
Costs paid
|
(83
|
)
|
|
—
|
|
|
(83
|
)
|
|||
Accrued charges at June 30, 2018
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Costs incurred
|
5,763
|
|
|
—
|
|
|
5,763
|
|
|||
Accrued charges at September 30, 2018
|
$
|
5,763
|
|
|
$
|
—
|
|
|
$
|
5,763
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||
|
2019
|
|
2019
|
||||
|
(In thousands)
|
||||||
Lease cost
|
|
|
|
||||
Operating lease cost
|
$
|
4,866
|
|
|
$
|
14,392
|
|
Short-term lease cost
|
12
|
|
|
41
|
|
||
Variable lease cost
|
143
|
|
|
147
|
|
||
Less: Sublease income
|
(27
|
)
|
|
(73
|
)
|
||
Total operating lease cost
|
$
|
4,994
|
|
|
$
|
14,507
|
|
|
September 30, 2019
|
||
|
(In thousands)
|
||
Remainder of 2019
|
$
|
5,084
|
|
2020
|
20,224
|
|
|
2021
|
20,406
|
|
|
2022
|
20,360
|
|
|
2023
|
19,575
|
|
|
Thereafter
|
57,005
|
|
|
Total future minimum lease payments
|
142,654
|
|
|
Less: Amounts representing interest
|
(19,855
|
)
|
|
Present value of net future minimum lease payments
|
$
|
122,799
|
|
|
December 31, 2018
|
||
(In thousands)
|
|||
2019
|
$
|
20,053
|
|
2020
|
19,344
|
|
|
2021
|
19,064
|
|
|
2022
|
18,802
|
|
|
2023
|
16,552
|
|
|
Thereafter
|
41,412
|
|
|
Total
|
$
|
135,227
|
|
|
As of and for the three months ended September 30,
|
|
|
|
|
|||||||||
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
|
(In thousands, except per share data)
|
|
|
|||||||||||
Total revenue
|
$
|
81,279
|
|
|
$
|
91,955
|
|
|
$
|
(10,676
|
)
|
|
(12
|
)%
|
Provision/ (credit) for loan losses
|
167
|
|
|
(949
|
)
|
|
1,116
|
|
|
nm
|
|
|||
Total operating expense
|
55,537
|
|
|
68,557
|
|
|
(13,020
|
)
|
|
(19
|
)%
|
|||
Net income from continuing operations
|
20,058
|
|
|
18,886
|
|
|
1,172
|
|
|
6
|
%
|
|||
Net income attributable to noncontrolling interests
|
96
|
|
|
924
|
|
|
(828
|
)
|
|
(90
|
)%
|
|||
Net income attributable to the Company
|
19,962
|
|
|
17,962
|
|
|
2,000
|
|
|
11
|
%
|
|||
Diluted earnings per share:
|
|
|
|
|
|
|
|
|||||||
From continuing operations
|
$
|
0.24
|
|
|
$
|
0.20
|
|
|
$
|
0.04
|
|
|
20
|
%
|
|
|
|
|
|
|
|
|
|||||||
ASSETS UNDER MANAGEMENT AND ADVISORY (“AUM”):
|
|
|
|
|
|
|
||||||||
Wealth Management and Trust
|
$
|
14,695,000
|
|
|
$
|
15,598,000
|
|
|
(903,000
|
)
|
|
(6
|
)%
|
|
Other (1)
|
1,533,000
|
|
|
6,832,000
|
|
|
(5,299,000
|
)
|
|
(78
|
)%
|
|||
Total AUM
|
$
|
16,228,000
|
|
|
$
|
22,430,000
|
|
|
$
|
(6,202,000
|
)
|
|
(28
|
)%
|
(1)
|
Includes the AUM at DGHM of $1.5 billion at September 30, 2019 and $2.1 billion at September 30, 2018, and the AUM at BOS of $4.7 billion at September 30, 2018.
|
▪
|
Total revenue decreased 12%, or $10.7 million, to $81.3 million for the three months ended September 30, 2019, compared to $92.0 million for the same period of 2018 as described below.
|
▪
|
Total fees and other income decreased 22%, or $7.2 million, to $25.1 million for the three months ended September 30, 2019, compared to $32.3 million for the same period of 2018. This decrease was primarily driven by the divestiture of BOS in 2018, as well as lower AUM balances at September 30, 2019. Total fees and other income represents 31% of Total revenue for the three months ended September 30, 2019, compared to 35% of Total revenue for the same period of 2018.
|
▪
|
Net interest income decreased 6%, or $3.5 million, to $56.2 million for the three months ended September 30, 2019, compared to $59.6 million for the same period of 2018. Net interest margin (“NIM”) was 2.72% for the three months ended September 30, 2019, representing a decrease of 18 basis points compared to the same period in 2018. The decreases in net interest income and NIM were primarily driven by higher funding costs, partially offset by higher asset yields on cash and investments.
|
▪
|
Total operating expenses decreased 19%, or $13.0 million, to $55.5 million for the three months ended September 30, 2019, compared to $68.6 million for the same period of 2018. The decrease was primarily
|
▪
|
For the three months ended September 30, 2019, total loans decreased slightly by $13.1 million, while total deposits increased $220.3 million, or 3%, from prior quarter. During the third quarter of 2019, the Company sold $92.4 million of residential mortgage loans. The Company’s loan-to-deposit ratio was 106% as of September 30, 2019. Deposits are the Company’s primary source of funds to originate loans. When the Company’s loan-to-deposit ratio exceeds 100%, we rely on other funding sources such as FHLB borrowings or federal funds to fund loan growth. If the Company is unable to grow deposits in line with loan growth, we will evaluate other options such as slowing loan growth, selling a portion of portfolio loans, or originating mortgage loans as held for sale.
|
|
Three months ended September 30,
|
|
$
Change |
|
% Change
|
|
Nine months ended September 30,
|
|
$
Change
|
|
%
Change
|
||||||||||||||||||
|
2019
|
|
2018
|
|
|
|
2019
|
|
2018
|
|
|
||||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||||
Net interest income
|
$
|
56,153
|
|
|
$
|
59,641
|
|
|
(3,488
|
)
|
|
(6
|
)%
|
|
$
|
171,951
|
|
|
$
|
174,569
|
|
|
$
|
(2,618
|
)
|
|
(1
|
)%
|
|
Fees and other income
|
25,126
|
|
|
32,314
|
|
|
(7,188
|
)
|
|
(22
|
)%
|
|
74,754
|
|
|
104,152
|
|
|
(29,398
|
)
|
|
(28
|
)%
|
||||||
Total revenue
|
81,279
|
|
|
91,955
|
|
|
(10,676
|
)
|
|
(12
|
)%
|
|
246,705
|
|
|
278,721
|
|
|
(32,016
|
)
|
|
(11
|
)%
|
||||||
Provision/ (credit) for loan losses
|
167
|
|
|
(949
|
)
|
|
1,116
|
|
|
nm
|
|
|
104
|
|
|
(2,291
|
)
|
|
2,395
|
|
|
nm
|
|
||||||
Operating expense
|
55,537
|
|
|
68,557
|
|
|
(13,020
|
)
|
|
(19
|
)%
|
|
171,749
|
|
|
203,798
|
|
|
(32,049
|
)
|
|
(16
|
)%
|
||||||
Income tax expense
|
5,517
|
|
|
5,461
|
|
|
56
|
|
|
1
|
%
|
|
15,803
|
|
|
28,886
|
|
|
(13,083
|
)
|
|
(45
|
)%
|
||||||
Net income from continuing operations
|
20,058
|
|
|
18,886
|
|
|
1,172
|
|
|
6
|
%
|
|
59,049
|
|
|
48,328
|
|
|
10,721
|
|
|
22
|
%
|
||||||
Net income from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
nm
|
|
|
—
|
|
|
1,696
|
|
|
(1,696
|
)
|
|
nm
|
|
||||||
Less: Net income attributable to noncontrolling interests
|
96
|
|
|
924
|
|
|
(828
|
)
|
|
(90
|
)%
|
|
265
|
|
|
2,942
|
|
|
(2,677
|
)
|
|
(91
|
)%
|
||||||
Net income attributable to the Company
|
$
|
19,962
|
|
|
$
|
17,962
|
|
|
$
|
2,000
|
|
|
11
|
%
|
|
$
|
58,784
|
|
|
$
|
47,082
|
|
|
$
|
11,702
|
|
|
25
|
%
|
|
Average Balance
|
|
Interest Income/Expense
|
|
Average Yield/Rate (1)
|
||||||||||||||||
|
As of and for the three months ended September 30,
|
||||||||||||||||||||
AVERAGE BALANCE SHEET:
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
AVERAGE ASSETS
|
(In thousands)
|
|
|
|
|
||||||||||||||||
Interest-earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and investments: (2)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Taxable investment securities
|
$
|
198,655
|
|
|
$
|
324,583
|
|
|
$
|
938
|
|
|
$
|
1,510
|
|
|
1.95
|
%
|
|
1.86
|
%
|
Non-taxable investment securities
|
305,108
|
|
|
297,710
|
|
|
1,924
|
|
|
1,779
|
|
|
2.52
|
%
|
|
2.39
|
%
|
||||
Mortgage-backed securities
|
492,514
|
|
|
552,820
|
|
|
2,622
|
|
|
2,941
|
|
|
2.13
|
%
|
|
2.13
|
%
|
||||
Short-term investments and other
|
101,958
|
|
|
204,814
|
|
|
1,084
|
|
|
1,617
|
|
|
4.06
|
%
|
|
3.11
|
%
|
||||
Total cash and investments
|
1,098,235
|
|
|
1,379,927
|
|
|
6,568
|
|
|
7,847
|
|
|
2.39
|
%
|
|
2.27
|
%
|
||||
Loans: (3)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial
|
1,101,672
|
|
|
998,817
|
|
|
11,523
|
|
|
9,894
|
|
|
4.09
|
%
|
|
3.88
|
%
|
||||
Commercial real estate
|
2,518,048
|
|
|
2,475,143
|
|
|
29,118
|
|
|
29,482
|
|
|
4.52
|
%
|
|
4.66
|
%
|
||||
Construction and land
|
195,843
|
|
|
179,248
|
|
|
2,410
|
|
|
2,193
|
|
|
4.82
|
%
|
|
4.79
|
%
|
||||
Residential
|
3,016,265
|
|
|
2,836,593
|
|
|
25,567
|
|
|
23,907
|
|
|
3.39
|
%
|
|
3.37
|
%
|
||||
Home equity
|
89,068
|
|
|
94,050
|
|
|
1,121
|
|
|
1,089
|
|
|
4.99
|
%
|
|
4.59
|
%
|
||||
Other consumer
|
127,987
|
|
|
163,224
|
|
|
1,297
|
|
|
1,689
|
|
|
4.02
|
%
|
|
4.11
|
%
|
||||
Total loans
|
7,048,883
|
|
|
6,747,075
|
|
|
71,036
|
|
|
68,254
|
|
|
3.98
|
%
|
|
3.99
|
%
|
||||
Total earning assets
|
8,147,118
|
|
|
8,127,002
|
|
|
77,604
|
|
|
76,101
|
|
|
3.76
|
%
|
|
3.70
|
%
|
||||
LESS: Allowance for loan losses
|
75,199
|
|
|
73,861
|
|
|
|
|
|
|
|
|
|
||||||||
Cash and due from banks (non-interest bearing)
|
49,065
|
|
|
46,056
|
|
|
|
|
|
|
|
|
|
||||||||
Other assets
|
544,368
|
|
|
392,757
|
|
|
|
|
|
|
|
|
|
||||||||
TOTAL AVERAGE ASSETS
|
$
|
8,665,352
|
|
|
$
|
8,491,954
|
|
|
|
|
|
|
|
|
|
||||||
AVERAGE LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS, AND SHAREHOLDERS’ EQUITY
|
|||||||||||||||||||||
Interest-bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing deposits:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Savings and NOW
|
$
|
615,730
|
|
|
$
|
693,419
|
|
|
$
|
275
|
|
|
$
|
301
|
|
|
0.18
|
%
|
|
0.17
|
%
|
Money market
|
3,378,006
|
|
|
3,244,628
|
|
|
11,523
|
|
|
8,110
|
|
|
1.35
|
%
|
|
0.99
|
%
|
||||
Certificates of deposit
|
711,299
|
|
|
730,117
|
|
|
3,689
|
|
|
3,076
|
|
|
2.06
|
%
|
|
1.67
|
%
|
||||
Total interest-bearing deposits
|
4,705,035
|
|
|
4,668,164
|
|
|
15,487
|
|
|
11,487
|
|
|
1.31
|
%
|
|
0.98
|
%
|
||||
Junior subordinated debentures
|
106,363
|
|
|
106,363
|
|
|
1,022
|
|
|
1,028
|
|
|
3.76
|
%
|
|
3.78
|
%
|
||||
FHLB borrowings and other
|
833,535
|
|
|
768,015
|
|
|
4,942
|
|
|
3,945
|
|
|
2.32
|
%
|
|
2.01
|
%
|
||||
Total interest-bearing liabilities
|
5,644,933
|
|
|
5,542,542
|
|
|
21,451
|
|
|
16,460
|
|
|
1.50
|
%
|
|
1.17
|
%
|
||||
Non-interest bearing demand deposits
|
1,953,214
|
|
|
2,063,642
|
|
|
|
|
|
|
|
|
|
||||||||
Payables and other liabilities
|
258,371
|
|
|
135,508
|
|
|
|
|
|
|
|
|
|
||||||||
Total average liabilities
|
7,856,518
|
|
|
7,741,692
|
|
|
|
|
|
|
|
|
|
||||||||
Redeemable noncontrolling interests
|
944
|
|
|
13,074
|
|
|
|
|
|
|
|
|
|
||||||||
Average shareholders’ equity
|
807,890
|
|
|
737,188
|
|
|
|
|
|
|
|
|
|
||||||||
TOTAL AVERAGE LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS, AND SHAREHOLDERS’ EQUITY
|
$
|
8,665,352
|
|
|
$
|
8,491,954
|
|
|
|
|
|
|
|
|
|
||||||
Net interest income
|
|
|
|
|
$
|
56,153
|
|
|
$
|
59,641
|
|
|
|
|
|
||||||
Interest rate spread
|
|
|
|
|
|
|
|
|
2.26
|
%
|
|
2.53
|
%
|
||||||||
Net interest margin
|
|
|
|
|
|
|
|
|
2.72
|
%
|
|
2.90
|
%
|
(1)
|
Annualized.
|
(2)
|
Investments classified as available-for-sale and held-to-maturity are shown in the average balance sheet at amortized cost.
|
(3)
|
Includes loans held for sale and nonaccrual loans.
|
|
Average Balance
|
|
Interest Income/Expense
|
|
Average Yield/Rate (1)
|
||||||||||||||||
|
As of and for the nine months ended September 30,
|
||||||||||||||||||||
AVERAGE BALANCE SHEET:
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
AVERAGE ASSETS
|
(In thousands)
|
|
|
|
|
||||||||||||||||
Interest-earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and investments: (2)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Taxable investment securities
|
$
|
223,072
|
|
|
$
|
328,054
|
|
|
$
|
3,244
|
|
|
$
|
4,521
|
|
|
1.94
|
%
|
|
1.84
|
%
|
Non-taxable investment securities
|
305,422
|
|
|
297,509
|
|
|
5,726
|
|
|
5,261
|
|
|
2.50
|
%
|
|
2.36
|
%
|
||||
Mortgage-backed securities
|
507,338
|
|
|
570,578
|
|
|
8,225
|
|
|
9,168
|
|
|
2.16
|
%
|
|
2.14
|
%
|
||||
Short-term investments and other
|
104,225
|
|
|
174,736
|
|
|
3,049
|
|
|
3,831
|
|
|
3.78
|
%
|
|
2.91
|
%
|
||||
Total cash and investments
|
1,140,057
|
|
|
1,370,877
|
|
|
20,244
|
|
|
22,781
|
|
|
2.36
|
%
|
|
2.21
|
%
|
||||
Loans: (3)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial
|
1,088,027
|
|
|
969,063
|
|
|
33,673
|
|
|
27,554
|
|
|
4.08
|
%
|
|
3.75
|
%
|
||||
Commercial real estate
|
2,474,804
|
|
|
2,464,788
|
|
|
87,222
|
|
|
83,020
|
|
|
4.65
|
%
|
|
4.44
|
%
|
||||
Construction and land
|
203,211
|
|
|
171,825
|
|
|
7,610
|
|
|
6,142
|
|
|
4.94
|
%
|
|
4.71
|
%
|
||||
Residential
|
2,999,480
|
|
|
2,771,875
|
|
|
76,847
|
|
|
68,263
|
|
|
3.42
|
%
|
|
3.28
|
%
|
||||
Home equity
|
90,361
|
|
|
95,217
|
|
|
3,388
|
|
|
3,172
|
|
|
5.01
|
%
|
|
4.45
|
%
|
||||
Other consumer
|
128,879
|
|
|
176,086
|
|
|
4,172
|
|
|
5,080
|
|
|
4.33
|
%
|
|
3.86
|
%
|
||||
Total loans
|
6,984,762
|
|
|
6,648,854
|
|
|
212,912
|
|
|
193,231
|
|
|
4.04
|
%
|
|
3.85
|
%
|
||||
Total earning assets
|
8,124,819
|
|
|
8,019,731
|
|
|
233,156
|
|
|
216,012
|
|
|
3.80
|
%
|
|
3.57
|
%
|
||||
LESS: Allowance for loan losses
|
74,863
|
|
|
73,894
|
|
|
|
|
|
|
|
|
|
||||||||
Cash and due from banks (non-interest bearing)
|
46,906
|
|
|
47,859
|
|
|
|
|
|
|
|
|
|
||||||||
Other assets
|
516,642
|
|
|
404,375
|
|
|
|
|
|
|
|
|
|
||||||||
TOTAL AVERAGE ASSETS
|
$
|
8,613,504
|
|
|
$
|
8,398,071
|
|
|
|
|
|
|
|
|
|
||||||
AVERAGE LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS, AND SHAREHOLDERS’ EQUITY
|
|||||||||||||||||||||
Interest-bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing deposits:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Savings and NOW
|
$
|
658,154
|
|
|
$
|
709,751
|
|
|
$
|
847
|
|
|
$
|
820
|
|
|
0.17
|
%
|
|
0.15
|
%
|
Money market
|
3,317,117
|
|
|
3,139,107
|
|
|
32,072
|
|
|
17,967
|
|
|
1.29
|
%
|
|
0.77
|
%
|
||||
Certificates of deposit
|
746,453
|
|
|
691,670
|
|
|
11,141
|
|
|
7,589
|
|
|
2.00
|
%
|
|
1.47
|
%
|
||||
Total interest-bearing deposits
|
4,721,724
|
|
|
4,540,528
|
|
|
44,060
|
|
|
26,376
|
|
|
1.25
|
%
|
|
0.78
|
%
|
||||
Junior subordinated debentures
|
106,363
|
|
|
106,363
|
|
|
3,223
|
|
|
2,882
|
|
|
4.05
|
%
|
|
3.62
|
%
|
||||
FHLB borrowings and other
|
801,519
|
|
|
889,178
|
|
|
13,922
|
|
|
12,185
|
|
|
2.29
|
%
|
|
1.81
|
%
|
||||
Total interest-bearing liabilities
|
5,629,606
|
|
|
5,536,069
|
|
|
61,205
|
|
|
41,443
|
|
|
1.45
|
%
|
|
1.00
|
%
|
||||
Non-interest bearing demand deposits
|
1,949,948
|
|
|
1,948,573
|
|
|
|
|
|
|
|
|
|
||||||||
Payables and other liabilities
|
243,370
|
|
|
130,410
|
|
|
|
|
|
|
|
|
|
||||||||
Total average liabilities
|
7,822,924
|
|
|
7,615,052
|
|
|
|
|
|
|
|
|
|
||||||||
Redeemable noncontrolling interests
|
1,642
|
|
|
16,294
|
|
|
|
|
|
|
|
|
|
||||||||
Average shareholders’ equity
|
788,938
|
|
|
766,725
|
|
|
|
|
|
|
|
|
|
||||||||
TOTAL AVERAGE LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS, AND SHAREHOLDERS’ EQUITY
|
$
|
8,613,504
|
|
|
$
|
8,398,071
|
|
|
|
|
|
|
|
|
|
||||||
Net interest income
|
|
|
|
|
$
|
171,951
|
|
|
$
|
174,569
|
|
|
|
|
|
||||||
Interest rate spread
|
|
|
|
|
|
|
|
|
2.35
|
%
|
|
2.57
|
%
|
||||||||
Net interest margin
|
|
|
|
|
|
|
|
|
2.80
|
%
|
|
2.88
|
%
|
(1)
|
Annualized.
|
(2)
|
Investments classified as available-for-sale and held-to-maturity are shown in the average balance sheet at amortized cost.
|
(3)
|
Includes loans held for sale and nonaccrual loans.
|
|
Three months ended September 30,
|
|
$
Change
|
|
% Change
|
|
Nine months ended September 30,
|
|
$
Change
|
|
%
Change
|
||||||||||||||||||
|
2019
|
|
2018
|
|
|
|
2019
|
|
2018
|
|
|
||||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||||
Wealth management and trust fees
|
$
|
19,067
|
|
|
$
|
25,505
|
|
|
$
|
(6,438
|
)
|
|
(25
|
)%
|
|
$
|
57,037
|
|
|
$
|
76,030
|
|
|
$
|
(18,993
|
)
|
|
(25
|
)%
|
Investment management fees
|
2,496
|
|
|
3,245
|
|
|
(749
|
)
|
|
(23
|
)%
|
|
7,601
|
|
|
18,897
|
|
|
(11,296
|
)
|
|
(60
|
)%
|
||||||
Other banking fee income
|
2,658
|
|
|
2,775
|
|
|
(117
|
)
|
|
(4
|
)%
|
|
8,024
|
|
|
7,793
|
|
|
231
|
|
|
3
|
%
|
||||||
Gain on sale of loans, net
|
934
|
|
|
67
|
|
|
867
|
|
|
nm
|
|
|
1,065
|
|
|
204
|
|
|
861
|
|
|
nm
|
|
||||||
Total core fees and income
|
25,155
|
|
|
31,592
|
|
|
(6,437
|
)
|
|
(20
|
)%
|
|
73,727
|
|
|
102,924
|
|
|
(29,197
|
)
|
|
(28
|
)%
|
||||||
Total other income
|
(29
|
)
|
|
722
|
|
|
(751
|
)
|
|
nm
|
|
|
1,027
|
|
|
1,228
|
|
|
(201
|
)
|
|
(16
|
)%
|
||||||
Total fees and other income
|
$
|
25,126
|
|
|
$
|
32,314
|
|
|
$
|
(7,188
|
)
|
|
(22
|
)%
|
|
$
|
74,754
|
|
|
$
|
104,152
|
|
|
$
|
(29,398
|
)
|
|
(28
|
)%
|
•
|
Total AUM managed or advised by the Company was $16.2 billion at September 30, 2019, a decrease of $6.2 billion, or 28%, compared to September 30, 2018. The decrease was primarily driven by the divestiture of BOS in the fourth quarter of 2018. Excluding AUM at BOS as of September 30, 2018, AUM decreased $1.5 billion, or 8%, compared to September 30, 2018 driven by net outflows of $1.5 billion for the twelve months ended September 30, 2019.
|
•
|
Other banking fee income for the three months ended September 30, 2019 decreased $0.1 million, or 4%, compared to the same period in 2018. Other banking fee income for the nine months ended September 30, 2019 increased $0.2 million, or 3%, compared to the same period in 2018. The decrease for the three month period is primarily driven by lower foreign exchange fee income. The increase for the nine month period is primarily driven by swap fee income reflecting changes in client demand for loan swap agreements.
|
•
|
Gain on sale of loans, net for the three and nine months ended September 30, 2019 includes a $0.8 million gain on the sale of $92.4 million of residential mortgage loans from the New England region in the third quarter of 2019.
|
|
Three months ended September 30,
|
|
$
Change
|
|
% Change
|
|
Nine months ended September 30,
|
|
$
Change
|
|
%
Change
|
||||||||||||||||||
|
2019
|
|
2018
|
|
|
|
2019
|
|
2018
|
|
|
||||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||||
Salaries and employee benefits
|
$
|
31,684
|
|
|
$
|
38,944
|
|
|
$
|
(7,260
|
)
|
|
(19
|
)%
|
|
$
|
100,116
|
|
|
$
|
125,461
|
|
|
$
|
(25,345
|
)
|
|
(20
|
)%
|
Occupancy and equipment
|
8,260
|
|
|
8,164
|
|
|
96
|
|
|
1
|
%
|
|
24,460
|
|
|
24,141
|
|
|
319
|
|
|
1
|
%
|
||||||
Information systems
|
5,169
|
|
|
6,233
|
|
|
(1,064
|
)
|
|
(17
|
)%
|
|
16,166
|
|
|
18,889
|
|
|
(2,723
|
)
|
|
(14
|
)%
|
||||||
Professional services
|
4,435
|
|
|
2,877
|
|
|
1,558
|
|
|
54
|
%
|
|
11,308
|
|
|
8,926
|
|
|
2,382
|
|
|
27
|
%
|
||||||
Marketing and business development
|
1,403
|
|
|
1,710
|
|
|
(307
|
)
|
|
(18
|
)%
|
|
4,422
|
|
|
5,373
|
|
|
(951
|
)
|
|
(18
|
)%
|
||||||
Amortization of intangibles
|
671
|
|
|
750
|
|
|
(79
|
)
|
|
(11
|
)%
|
|
2,015
|
|
|
2,249
|
|
|
(234
|
)
|
|
(10
|
)%
|
||||||
FDIC insurance
|
59
|
|
|
674
|
|
|
(615
|
)
|
|
(91
|
)%
|
|
1,304
|
|
|
2,126
|
|
|
(822
|
)
|
|
(39
|
)%
|
||||||
Restructuring
|
—
|
|
|
5,763
|
|
|
(5,763
|
)
|
|
(100
|
)%
|
|
1,646
|
|
|
5,763
|
|
|
(4,117
|
)
|
|
(71
|
)%
|
||||||
Other
|
3,856
|
|
|
3,442
|
|
|
414
|
|
|
12
|
%
|
|
10,312
|
|
|
10,870
|
|
|
(558
|
)
|
|
(5
|
)%
|
||||||
Total operating expense
|
$
|
55,537
|
|
|
$
|
68,557
|
|
|
$
|
(13,020
|
)
|
|
(19
|
)%
|
|
$
|
171,749
|
|
|
$
|
203,798
|
|
|
$
|
(32,049
|
)
|
|
(16
|
)%
|
•
|
Salaries and employee benefits expense decreased for the three and nine months ended September 30, 2019 compared to the same periods of 2018. The decrease for the three month period was primarily due to the divestiture of BOS and lower variable compensation. The decrease for the nine month period was primarily due to the divestitures of Anchor and BOS, as well as lower variable compensation. The Company also realized further cost savings as a result of a previously announced efficiency program.
|
•
|
Restructuring expense decreased for the three and nine months ended September 30, 2019, compared to the same periods in 2018, as the Company incurred a restructuring charge of $1.6 million due to severance of executives in the first quarter of 2019, which is less than the $5.8 million of restructuring charges in the third quarter of 2018. There were no restructuring charges in the third quarter of 2019.
|
•
|
Information systems expense for the three and nine months ended September 30, 2019 decreased compared to the same periods in 2018. The decrease for the three month period was primarily due to the divestiture of BOS and realized savings from telecommunication services and data processing contract renegotiations. The decrease for the nine month period was primarily due to the divestitures of Anchor and BOS, as well as realized savings from telecommunication services and data processing contract renegotiations.
|
•
|
Marketing and business development expense for the three and nine months ended September 30, 2019 decreased compared to the same periods in 2018. The decrease for the three month period was primarily due to the divestiture of BOS and a decrease in business development expenses. The decrease for the nine month period was primarily due to the divestitures of Anchor and BOS, as well as a decrease in business development expenses.
|
•
|
Professional services expense for the three and nine months ended September 30, 2019 increased compared to the same periods in 2018, primarily due to information technology consulting costs and recruiting expense, partially offset by the divestitures of Anchor and BOS for the periods owned.
|
|
September 30,
2019 |
|
December 31, 2018
|
|
Increase/
(decrease)
|
|
%
Change
|
|||||||
|
(In thousands)
|
|||||||||||||
Assets:
|
|
|
|
|
|
|
|
|||||||
Total cash and investments
|
$
|
1,134,463
|
|
|
$
|
1,255,253
|
|
|
$
|
(120,790
|
)
|
|
(10
|
)%
|
Loans held for sale
|
6,658
|
|
|
2,812
|
|
|
3,846
|
|
|
nm
|
|
|||
Total loans
|
7,067,151
|
|
|
6,893,158
|
|
|
173,993
|
|
|
3
|
%
|
|||
Less: Allowance for loan losses
|
75,359
|
|
|
75,312
|
|
|
47
|
|
|
—
|
%
|
|||
Net loans
|
6,991,792
|
|
|
6,817,846
|
|
|
173,946
|
|
|
3
|
%
|
|||
Goodwill and intangible assets, net
|
68,229
|
|
|
69,834
|
|
|
(1,605
|
)
|
|
(2
|
)%
|
|||
Right-of-use assets
|
107,045
|
|
|
—
|
|
|
107,045
|
|
|
nm
|
|
|||
Total other assets
|
382,757
|
|
|
348,880
|
|
|
33,877
|
|
|
10
|
%
|
|||
Total assets
|
$
|
8,690,944
|
|
|
$
|
8,494,625
|
|
|
$
|
196,319
|
|
|
2
|
%
|
Liabilities and Equity:
|
|
|
|
|
|
|
|
|||||||
Deposits
|
$
|
6,658,242
|
|
|
$
|
6,781,170
|
|
|
$
|
(122,928
|
)
|
|
(2
|
)%
|
Total borrowings
|
956,127
|
|
|
813,435
|
|
|
142,692
|
|
|
18
|
%
|
|||
Lease liabilities
|
122,799
|
|
|
—
|
|
|
122,799
|
|
|
nm
|
|
|||
Total other liabilities
|
143,607
|
|
|
143,540
|
|
|
67
|
|
|
—
|
%
|
|||
Total liabilities
|
7,880,775
|
|
|
7,738,145
|
|
|
142,630
|
|
|
2
|
%
|
|||
Redeemable noncontrolling interests (“RNCI”)
|
1,481
|
|
|
2,526
|
|
|
(1,045
|
)
|
|
(41
|
)%
|
|||
Total shareholders’ equity
|
808,688
|
|
|
753,954
|
|
|
54,734
|
|
|
7
|
%
|
|||
Total liabilities, RNCI and shareholders’ equity
|
$
|
8,690,944
|
|
|
$
|
8,494,625
|
|
|
$
|
196,319
|
|
|
2
|
%
|
•
|
Other assets, which consist primarily of BOLI, investment in partnerships, prepaid expenses, the fair value of interest rate derivatives, and other receivables increased $47.6 million, or 19%, to $294.5 million at September 30, 2019 from $247.0 million at December 31, 2018. The increase was primarily driven by an increase in the market value adjustment on derivative assets.
|
•
|
Deferred income taxes, net, decreased $10.9 million, or 41%, to $15.7 million at September 30, 2019 from $26.6 million at December 31, 2018. The decrease was primarily due to the tax effect of unrealized gains on securities available-for-sale at September 30, 2019 compared to the tax effect of unrealized losses on securities available-for-sale at December 31, 2018.
|
•
|
Premises and equipment, net, decreased $2.8 million, or 6%, to $42.7 million at September 30, 2019 from $45.4 million at December 31, 2018. The decrease is related to the timing of new purchases, primarily related to the Company's information technology initiatives, as well as leasehold improvements.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||
|
Balance
|
|
as a % of total
|
|
Balance
|
|
as a % of total
|
||||||
|
(In thousands)
|
||||||||||||
Demand deposits (non-interest bearing)
|
$
|
1,947,363
|
|
|
29
|
%
|
|
$
|
1,951,274
|
|
|
29
|
%
|
NOW (1)
|
598,048
|
|
|
9
|
%
|
|
626,686
|
|
|
9
|
%
|
||
Savings
|
68,059
|
|
|
1
|
%
|
|
73,834
|
|
|
1
|
%
|
||
Money market (1)
|
3,366,623
|
|
|
51
|
%
|
|
3,338,891
|
|
|
49
|
%
|
||
Certificates of deposit less than $100,000 (1)
|
155,267
|
|
|
2
|
%
|
|
265,883
|
|
|
4
|
%
|
||
Certificates of deposit $100,000 to $250,000
|
102,138
|
|
|
2
|
%
|
|
98,120
|
|
|
2
|
%
|
||
Certificates of deposit more than $250,000
|
420,744
|
|
|
6
|
%
|
|
426,482
|
|
|
6
|
%
|
||
Total deposits
|
$
|
6,658,242
|
|
|
100
|
%
|
|
$
|
6,781,170
|
|
|
100
|
%
|
(1)
|
Includes brokered deposits of $355.4 million and $541.1 million at September 30, 2019 and December 31, 2018, respectively.
|
•
|
FHLB borrowings increased $150.8 million, or 36%, to $570.9 million at September 30, 2019 from $420.1 million at December 31, 2018. The increase was primarily due to asset liability management considerations to reduce the outstanding balance of brokered deposits and overnight federal funds purchased with term FHLB borrowings. FHLB borrowings are generally used to provide additional funding for loan growth when it is in excess of deposit growth and to manage interest rate risk, but can also be used as an additional source of liquidity for the Bank.
|
•
|
Repurchase agreements increased $11.9 million, or 32%, to $48.9 million at September 30, 2019 from $36.9 million at December 31, 2018. Repurchase agreements are generally linked to commercial demand deposit accounts with an overnight sweep feature.
|
•
|
From time to time, the Bank purchases federal funds from the FHLB and other banking institutions to supplement its liquidity position. At September 30, 2019, the Company had $230.0 million federal funds purchased outstanding compared to $250.0 million at December 31, 2018.
|
|
September 30,
2019 |
|
December 31, 2018
|
|
$ Change
|
|
% Change
|
|||||||
|
(In thousands)
|
|
|
|||||||||||
Commercial and industrial
|
$
|
695,029
|
|
|
$
|
623,037
|
|
|
$
|
71,992
|
|
|
12
|
%
|
Commercial tax-exempt
|
448,488
|
|
|
451,671
|
|
|
(3,183
|
)
|
|
(1
|
)%
|
|||
Total commercial and industrial
|
1,143,517
|
|
|
1,074,708
|
|
|
68,809
|
|
|
6
|
%
|
|||
Commercial real estate
|
2,533,346
|
|
|
2,395,692
|
|
|
137,654
|
|
|
6
|
%
|
|||
Construction and land
|
209,741
|
|
|
240,306
|
|
|
(30,565
|
)
|
|
(13
|
)%
|
|||
Residential
|
2,964,042
|
|
|
2,948,973
|
|
|
15,069
|
|
|
1
|
%
|
|||
Home equity
|
84,432
|
|
|
90,421
|
|
|
(5,989
|
)
|
|
(7
|
)%
|
|||
Consumer and other
|
132,073
|
|
|
143,058
|
|
|
(10,985
|
)
|
|
(8
|
)%
|
|||
Total loans
|
$
|
7,067,151
|
|
|
$
|
6,893,158
|
|
|
$
|
173,993
|
|
|
3
|
%
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In thousands)
|
||||||
Multifamily and residential investment
|
$
|
901,163
|
|
|
$
|
687,395
|
|
Retail
|
622,431
|
|
|
635,222
|
|
||
Office and medical
|
493,886
|
|
|
543,697
|
|
||
Manufacturing, industrial, and warehouse
|
208,428
|
|
|
193,472
|
|
||
Hospitality
|
136,119
|
|
|
187,132
|
|
||
Other
|
171,319
|
|
|
148,774
|
|
||
Total commercial real estate loans
|
$
|
2,533,346
|
|
|
$
|
2,395,692
|
|
|
As of September 30, 2019
|
||||||||||||||||||||||||||
|
New England
|
|
San Francisco Bay Area
|
|
Southern California
|
|
Total
|
||||||||||||||||||||
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||
Commercial and industrial
|
$
|
558,686
|
|
|
8
|
%
|
|
$
|
49,075
|
|
|
1
|
%
|
|
$
|
87,268
|
|
|
1
|
%
|
|
$
|
695,029
|
|
|
10
|
%
|
Commercial tax-exempt
|
340,610
|
|
|
5
|
%
|
|
96,846
|
|
|
1
|
%
|
|
11,032
|
|
|
—
|
%
|
|
448,488
|
|
|
6
|
%
|
||||
Commercial real estate
|
1,030,865
|
|
|
14
|
%
|
|
785,156
|
|
|
12
|
%
|
|
717,325
|
|
|
10
|
%
|
|
2,533,346
|
|
|
36
|
%
|
||||
Construction and land
|
146,799
|
|
|
2
|
%
|
|
27,958
|
|
|
—
|
%
|
|
34,984
|
|
|
1
|
%
|
|
209,741
|
|
|
3
|
%
|
||||
Residential
|
1,628,082
|
|
|
23
|
%
|
|
569,920
|
|
|
8
|
%
|
|
766,040
|
|
|
11
|
%
|
|
2,964,042
|
|
|
42
|
%
|
||||
Home equity
|
56,732
|
|
|
1
|
%
|
|
18,068
|
|
|
—
|
%
|
|
9,632
|
|
|
—
|
%
|
|
84,432
|
|
|
1
|
%
|
||||
Consumer and other
|
106,916
|
|
|
2
|
%
|
|
12,546
|
|
|
—
|
%
|
|
12,611
|
|
|
—
|
%
|
|
132,073
|
|
|
2
|
%
|
||||
Total loans (1)
|
$
|
3,868,690
|
|
|
55
|
%
|
|
$
|
1,559,569
|
|
|
22
|
%
|
|
$
|
1,638,892
|
|
|
23
|
%
|
|
$
|
7,067,151
|
|
|
100
|
%
|
|
As of December 31, 2018
|
||||||||||||||||||||||||||
|
New England
|
|
San Francisco Bay Area
|
|
Southern California
|
|
Total
|
||||||||||||||||||||
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||
Commercial and industrial
|
$
|
503,201
|
|
|
7
|
%
|
|
$
|
43,702
|
|
|
1
|
%
|
|
$
|
76,134
|
|
|
1
|
%
|
|
$
|
623,037
|
|
|
9
|
%
|
Commercial tax-exempt
|
344,079
|
|
|
5
|
%
|
|
96,387
|
|
|
2
|
%
|
|
11,205
|
|
|
—
|
%
|
|
451,671
|
|
|
7
|
%
|
||||
Commercial real estate
|
1,022,061
|
|
|
15
|
%
|
|
714,449
|
|
|
10
|
%
|
|
659,182
|
|
|
10
|
%
|
|
2,395,692
|
|
|
35
|
%
|
||||
Construction and land
|
153,929
|
|
|
2
|
%
|
|
41,516
|
|
|
—
|
%
|
|
44,861
|
|
|
1
|
%
|
|
240,306
|
|
|
3
|
%
|
||||
Residential
|
1,689,318
|
|
|
25
|
%
|
|
559,578
|
|
|
8
|
%
|
|
700,077
|
|
|
10
|
%
|
|
2,948,973
|
|
|
43
|
%
|
||||
Home equity
|
57,617
|
|
|
1
|
%
|
|
19,722
|
|
|
—
|
%
|
|
13,082
|
|
|
—
|
%
|
|
90,421
|
|
|
1
|
%
|
||||
Consumer and other
|
120,402
|
|
|
2
|
%
|
|
12,663
|
|
|
—
|
%
|
|
9,993
|
|
|
—
|
%
|
|
143,058
|
|
|
2
|
%
|
||||
Total loans (1)
|
$
|
3,890,607
|
|
|
57
|
%
|
|
$
|
1,488,017
|
|
|
21
|
%
|
|
$
|
1,514,534
|
|
|
22
|
%
|
|
$
|
6,893,158
|
|
|
100
|
%
|
(1)
|
Regional percentage totals may not foot due to rounding.
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In thousands)
|
||||||||||||||
Net loans (charged-off)/ recovered:
|
|
|
|
|
|
|
|
||||||||
New England
|
$
|
275
|
|
|
$
|
232
|
|
|
$
|
528
|
|
|
$
|
(126
|
)
|
San Francisco Bay Area
|
6
|
|
|
706
|
|
|
44
|
|
|
864
|
|
||||
Southern California
|
(156
|
)
|
|
47
|
|
|
(629
|
)
|
|
311
|
|
||||
Total net loans (charged-off)/ recovered
|
$
|
125
|
|
|
$
|
985
|
|
|
$
|
(57
|
)
|
|
$
|
1,049
|
|
|
As of and for the three months ended September 30,
|
|
As of and for the nine months ended September 30,
|
||||||||||||
2019
|
|
2018
|
|
2019
|
|
2018
|
|||||||||
(In thousands)
|
|||||||||||||||
Nonaccrual loans, beginning of period
|
$
|
17,155
|
|
|
$
|
15,651
|
|
|
$
|
14,057
|
|
|
$
|
14,295
|
|
Transfers in to nonaccrual status
|
2,830
|
|
|
3,901
|
|
|
9,088
|
|
|
8,819
|
|
||||
Transfers out to OREO
|
—
|
|
|
—
|
|
|
—
|
|
|
(108
|
)
|
||||
Transfers out to accrual status
|
(642
|
)
|
|
(2,122
|
)
|
|
(846
|
)
|
|
(3,914
|
)
|
||||
Charge-offs
|
(185
|
)
|
|
—
|
|
|
(944
|
)
|
|
(514
|
)
|
||||
Paid off/ paid down
|
(1,593
|
)
|
|
(5,333
|
)
|
|
(3,790
|
)
|
|
(6,481
|
)
|
||||
Nonaccrual loans, end of period
|
$
|
17,565
|
|
|
$
|
12,097
|
|
|
$
|
17,565
|
|
|
$
|
12,097
|
|
|
September 30,
2019 |
|
December 31, 2018
|
||||
|
(In thousands)
|
||||||
Nonaccrual loans:
|
|
|
|
||||
New England
|
$
|
8,999
|
|
|
$
|
6,728
|
|
San Francisco Bay Area
|
2,395
|
|
|
2,488
|
|
||
Southern California
|
6,171
|
|
|
4,841
|
|
||
Total nonaccrual loans
|
$
|
17,565
|
|
|
$
|
14,057
|
|
Loans 30-89 days past due and accruing:
|
|
|
|
||||
New England
|
$
|
1,404
|
|
|
$
|
15,961
|
|
San Francisco Bay Area
|
15
|
|
|
2,246
|
|
||
Southern California
|
2,760
|
|
|
4,092
|
|
||
Total loans 30-89 days past due
|
$
|
4,179
|
|
|
$
|
22,299
|
|
Accruing classified loans: (1)
|
|
|
|
||||
New England
|
$
|
21,830
|
|
|
$
|
10,392
|
|
San Francisco Bay Area
|
23,938
|
|
|
24,584
|
|
||
Southern California
|
17,510
|
|
|
19,119
|
|
||
Total accruing classified loans
|
$
|
63,278
|
|
|
$
|
54,095
|
|
(1)
|
Accruing Classified includes both Substandard and Doubtful classifications.
|
|
September 30,
2019 |
|
December 31, 2018
|
||||
|
(In thousands)
|
||||||
Nonaccrual loans:
|
|
|
|
||||
Commercial and industrial
|
$
|
800
|
|
|
$
|
2,554
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
||
Commercial real estate
|
—
|
|
|
546
|
|
||
Construction and land
|
—
|
|
|
—
|
|
||
Residential
|
14,219
|
|
|
7,914
|
|
||
Home equity
|
2,545
|
|
|
3,031
|
|
||
Consumer and other
|
1
|
|
|
12
|
|
||
Total nonaccrual loans
|
$
|
17,565
|
|
|
$
|
14,057
|
|
Loans 30-89 days past due and accruing:
|
|
|
|
||||
Commercial and industrial
|
$
|
3,048
|
|
|
$
|
9,794
|
|
Commercial tax-exempt
|
—
|
|
|
—
|
|
||
Commercial real estate
|
497
|
|
|
—
|
|
||
Construction and land
|
—
|
|
|
—
|
|
||
Residential
|
266
|
|
|
6,843
|
|
||
Home equity
|
353
|
|
|
602
|
|
||
Consumer and other
|
15
|
|
|
5,060
|
|
||
Total loans 30-89 days past due
|
$
|
4,179
|
|
|
$
|
22,299
|
|
Accruing classified loans: (1)
|
|
|
|
||||
Commercial and industrial
|
$
|
25,133
|
|
|
$
|
22,992
|
|
Commercial tax-exempt
|
4,052
|
|
|
4,051
|
|
||
Commercial real estate
|
30,814
|
|
|
27,052
|
|
||
Construction and land
|
—
|
|
|
—
|
|
||
Residential
|
3,000
|
|
|
—
|
|
||
Home equity
|
279
|
|
|
—
|
|
||
Consumer and other
|
—
|
|
|
—
|
|
||
Total accruing classified loans
|
$
|
63,278
|
|
|
$
|
54,095
|
|
(1)
|
Accruing Classified includes both Substandard and Doubtful classifications.
|
|
September 30,
2019 |
|
December 31, 2018
|
|
$
Change |
|
%
Change |
|||||||
|
(In thousands)
|
|||||||||||||
Cash and cash equivalents
|
$
|
78,010
|
|
|
$
|
127,259
|
|
|
$
|
(49,249
|
)
|
|
(39
|
)%
|
Investment securities available-for-sale
|
935,538
|
|
|
994,065
|
|
|
(58,527
|
)
|
|
(6
|
)%
|
|||
Equity securities at fair value
|
21,780
|
|
|
14,228
|
|
|
7,552
|
|
|
53
|
%
|
|||
LESS: Securities pledged against current borrowings and derivatives
|
(96,055
|
)
|
|
(44,022
|
)
|
|
(52,033
|
)
|
|
nm
|
|
|||
Cash and investments
|
$
|
939,273
|
|
|
$
|
1,091,530
|
|
|
$
|
(152,257
|
)
|
|
(14
|
)%
|
As a percent of assets
|
11
|
%
|
|
13
|
%
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|||||||
Access to additional FHLB borrowings
|
1,222,142
|
|
|
1,405,083
|
|
|
(182,941
|
)
|
|
(13
|
)%
|
|||
Total liquidity
|
$
|
2,161,415
|
|
|
$
|
2,496,613
|
|
|
$
|
(335,198
|
)
|
|
(13
|
)%
|
As a percent of assets
|
25
|
%
|
|
29
|
%
|
|
|
|
|
|
||||
As a percent of deposits
|
32
|
%
|
|
37
|
%
|
|
|
|
|
|
(1)
|
Required capital ratios with the fully phased-in capital conservation buffer added to the minimum risk-based capital ratios. The fully phased-in ratios are effective for 2019.
|
|
|
Issuer Purchases of Equity Securities
|
||||||||||||
Period
|
|
(a) Total number
of shares
purchased
|
|
(b) Average
price paid
per share
|
|
(c) Total number
of shares
purchased as
part of publicly
announced plans
|
|
(d) Maximum
approximate dollar
value of shares that
may yet be purchased
under the plans
|
||||||
July 1 - 31, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
20,000,000
|
|
August 1 - 31, 2019
|
|
499,910
|
|
|
10.58
|
|
|
499,910
|
|
|
14,710,315
|
|
||
September 1 - 30, 2019
|
|
178,255
|
|
|
10.68
|
|
|
678,165
|
|
|
12,807,043
|
|
||
Total
|
|
678,165
|
|
|
$
|
10.61
|
|
|
678,165
|
|
|
$
|
12,807,043
|
|
Exhibit No.
|
|
Description
|
|
Incorporated by Reference
|
|
Filed or
Furnished
with this
10-Q
|
||||
Form
|
|
SEC Filing
Date
|
|
Exhibit
Number
|
|
|||||
10.1
|
|
|
|
|
|
|
|
|
Filed
|
|
14.1
|
|
|
|
|
|
|
|
|
Filed
|
|
21.1
|
|
|
|
|
|
|
|
|
Filed
|
|
31.1
|
|
|
|
|
|
|
|
|
Filed
|
|
31.2
|
|
|
|
|
|
|
|
|
Filed
|
|
32.1
|
|
|
|
|
|
|
|
|
Furnished
|
|
32.2
|
|
|
|
|
|
|
|
|
Furnished
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document
|
|
|
|
|
|
|
|
Filed
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
Filed
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
Filed
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
Filed
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
Filed
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
Filed
|
|
|
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC.
|
|
|
|
/s/ ANTHONY DECHELLIS
|
November 4, 2019
|
Anthony DeChellis
|
|
Chief Executive Officer, President and Director
(Principal Executive Officer)
|
|
|
|
/s/ STEVEN M. GAVEN
|
November 4, 2019
|
Steven M. Gaven
|
|
Executive Vice President, Chief Financial Officer
|
I.
|
Introduction
|
•
|
Insider Trading and Disclosure Policy;
|
•
|
Reporting Unethical Behavior and Financial and Accounting Concerns (“Whistleblower Policy”); and
|
•
|
Internal Investigations Policy and Procedures
|
II.
|
Standards of Conduct
|
A.
|
Conflicts of Interest
|
B.
|
Compliance with Laws, Rules and Regulations
|
C.
|
Fair Dealing
|
D.
|
Protection and Proper Use of Company Assets; Corporate Opportunities
|
III.
|
Compliance Procedures
|
A.
|
Administration of Code
|
B.
|
Communication of Policies
|
C.
|
Monitoring Compliance and Disciplinary Action
|
(1)
|
Reporting Illegal or Unethical Behavior
|
(2)
|
Procedures for Submitting Concerns
|
•
|
In writing (which may be done anonymously), addressed to the General Counsel, either by facsimile to (617) 912-4551, by email to ccooper@bostonprivate.com, or by U.S. mail to: Christopher A. Cooper, Acting General Counsel, Boston Private Financial Holdings, Inc., Ten Post Office Square, Boston, Massachusetts 02109, CONFIDENTIAL.
|
•
|
By filing an anonymous report online or via telephone. The information provided will be sent to the Chair of the Company’s Audit and Finance Committee and the Company’s General Counsel’s Office by a third party vendor, EthicsPoint, on a totally confidential and anonymous basis. The report made will not accessible through EthicsPoint by any other member of management of the Company, or of any of its subsidiaries.
|
◦
|
Online: https://secure.ethicspoint.com/domain/en/report_custom.asp?clientid=23693 or www.ethicspoint.com
|
◦
|
Telephone: Reporting Line at (877) 243-3144.
|
(3)
|
Confidentiality; Anonymous Reporting
|
•
|
If an employee wishes to remain anonymous, he or she may do so, and the Company will use reasonable efforts to protect the confidentiality of the reporting person subject to applicable law, rule or regulation or to any applicable legal proceedings. In the event the report is made anonymously, however, the Company may not have sufficient information to look into or otherwise investigate or evaluate the allegations. Accordingly, persons who make reports anonymously should endeavor to provide as much detail as is reasonably necessary to permit the Company to evaluate the matter(s) set forth in the anonymous report and, if appropriate, commence and conduct an appropriate investigation.
|
(4)
|
Policy Against Retaliation
|
E.
|
Investigating Violations
|
F.
|
Waivers and Amendments
|
Subsidiaries of the Company
|
|
State or Other Jurisdiction of Incorporation
|
Boston Private Capital, Inc.
|
|
MA
|
Boston Private Bank & Trust Company
|
|
MA
|
Boston Private Wealth LLC
|
|
MA
|
BPB-IMT & Co., LLP
|
|
MA
|
BPB Securities Corporation
|
|
MA
|
BPB Securities Corporation II
|
|
MA
|
Lerob LLC
|
|
CA
|
Ten Winthrop Properties, Inc.
|
|
MA
|
Boston Private Capital Trust I
|
|
DE
|
Boston Private Capital Trust II
|
|
DE
|
Dalton, Greiner, Hartman & Maher & Co. LLC
|
|
DE
|
DGHM Management LLC
|
|
DE
|
DGHM Enhanced Value LP
|
|
DE
|
DGHM Enhanced Value LTD
|
|
Grand Cayman Island
|
DGHM Partners LLC
|
|
DE
|
DGHM Ultra Value Partners LP
|
|
DE
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Boston Private Financial Holdings, Inc. (the “registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/s/ ANTHONY DECHELLIS
|
Date: November 4, 2019
|
|
Anthony DeChellis
|
|
Chief Executive Officer, President and Director
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Boston Private Financial Holdings, Inc. (the “registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/s/ STEVEN M. GAVEN
|
|
|
Steven M. Gaven
|
Date: November 4, 2019
|
|
Executive Vice President, Chief Financial Officer
|
|
|
|
|
|
/s/ ANTHONY DECHELLIS
|
|
|
|
|
|
Anthony DeChellis
|
Date: November 4, 2019
|
|
|
|
|
Chief Executive Officer, President and Director
|
|
|
|
|
|
/s/ STEVEN M. GAVEN
|
|
|
|
|
|
Steven M. Gaven
|
Date: November 4, 2019
|
|
|
|
|
Executive Vice President, Chief Financial Officer
|