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Bryn Mawr Bank Corporation Reports Second Quarter Net Income of $8.9 Million, Driven by Increases to Net Interest Income, Wealth Management Revenue, Reduced Provision; Quarterly Dividend Increased by 5%

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BRYN MAWR, Pa., July 21, 2016 (GLOBE NEWSWIRE) -- Bryn Mawr Bank Corporation (NASDAQ: BMTC) (the "Corporation"), parent of The Bryn Mawr Trust Company (the "Bank"), today reported net income of $8.9 million and diluted earnings per share of $0.52 for the three months ended June 30, 2016, as compared to $8.3 million, or $0.49 diluted earnings per share for the three months ended March 31, 2016 and $8.1 million, or $0.45 diluted earnings per share for the three months ended June 30, 2015.

On a non-GAAP basis, core net income, which excludes certain non-core income and expense items, as detailed in the appendix to this earnings release, was also $8.9 million, or $0.53 diluted earnings per share for the three months ended June 30, 2016 as compared to $8.3 million, or $0.49 diluted earnings per share for the three months ended March 31, 2016 and $9.0 million, or $0.50 diluted earnings per share for the three months ended June 30, 2015. Management believes the core net income measure is important in evaluating the Corporation's performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

"The results for the second quarter are promising, with the full effect of the first quarter loan growth having a significant impact on our net interest income," commented Frank Leto, President and Chief Executive Officer, continuing, "in addition, our credit quality continues to be strong, with low charge-off and delinquency levels which are reflected in the reduced provision recorded this quarter." Mr. Leto added, "As we saw in the first quarter of this year, we continue to experience the positive results stemming from the strategic decisions we made in 2015. We are beginning to reap the benefits of our significant investment in new technology, and the addition of new teams and talent to the organization."

On July 21, 2016, the Board of Directors of the Corporation elected to increase the quarterly dividend by 5%, declaring a quarterly dividend of $0.21 per share, payable September 1, 2016 to shareholders of record as of August 2, 2016.

SIGNIFICANT ITEMS OF NOTE
Results of Operations – Second Quarter 2016 Compared to First Quarter 2016

  • Net income for the three months ended June 30, 2016 was $8.9 million, as compared to $8.3 million for the three months ended March 31, 2016. Largely accounting for the increase in net income was a $725 thousand increase in net interest income, a $965 thousand decrease in provision for loan and lease losses (the "Provision") and a $599 thousand increase in fees for wealth management services between the periods. Partially offsetting these items were a $431 thousand decrease in insurance revenue, a $516 thousand increase in impairment of mortgage servicing rights ("MSRs"), and a $459 thousand increase in salaries and wages.
     
  • Net interest income for the three months ended June 30, 2016 was $26.6 million, an increase of $725 thousand from $25.9 million for the three months ended March 31, 2016. Portfolio loan balances as of June 30, 2016 increased by $45.0 million from March 31, 2016, however, the average balance of portfolio loans for the three months ended June 30, 2016 increased $101.7 million from the three months ended March 31, 2016, indicating that the loan growth during the first quarter of 2016 was weighted more toward the end of the quarter. Partially funding this growth in portfolio loans was an $83.6 million increase, during the second quarter of 2016, in average interest-bearing deposits, largely concentrated in the retail time deposit segment of the deposit portfolio.
     
  • The tax-equivalent net interest margin of 3.81% for the second quarter of 2016 decreased 6 basis points from 3.87% for the first quarter of 2016. The decrease was the result of a 4 basis point decrease in tax-equivalent yield earned on loans, coupled with increases in the tax-equivalent rates paid on interest-bearing deposits and borrowings of 7 basis points and 4 basis points, respectively. The contribution of fair value mark accretion to the tax equivalent net interest margin accounted for 17 basis points of the margin for the second quarter of 2016 as compared to 16 basis points for the first quarter of 2016.
     
  • Non-interest income for the three months ended June 30, 2016 increased $612 thousand from the first quarter of 2016. The increase was related to increases of $599 thousand and $136 thousand in fees for wealth management services and gain on sale of loans, respectively. Fees for wealth management services increased largely as a result of a rebound, during the second quarter, of the asset balances in wealth accounts whose fees are tied to market values. In addition, fees for tax services charged during the second quarter augmented this growth. Further, the gain on sale of loans increased as the mortgage banking strategic initiative continues to build. Partially offsetting these increases was a decrease of $431 thousand in insurance revenues. During the first quarter of 2016, the insurance division received a $434 thousand contingent commission from the insurance carriers which was not repeated in the second quarter of 2016.
     
  • Non-interest expense for the three months ended June 30, 2016 increased $1.2 million, to $26.3 million, as compared to $25.1 million for the first quarter of 2016. Largely contributing to the increase was the $516 thousand increase in impairment of MSRs recorded during the second quarter. This impairment was the result of increased expectations for the continuation of the low interest rate environment, partially driven by international events, which caused interest rates to fall at the end of the quarter.  In addition, salaries and wages increased by $459 thousand from the first quarter of 2016, largely due to incentive accruals.
     
  • For the three months ended June 30, 2016, net loan and lease charge-offs totaled $254 thousand, as compared to $422 thousand for the first quarter of 2016. The Provision for the three months ended June 30, 2016 was $445 thousand, as compared to $1.4 million for the first quarter of 2016. As of June 30, 2016, certain metrics related to the credit quality of the loan portfolio, which included delinquency and nonperforming percentages, had improved from levels seen at March 31, 2016, resulting in a lower level of allowance for loan and lease losses (the "Allowance").

Results of Operations – Second Quarter 2016 Compared to Second Quarter 2015

  • Net income for the three months ended June 30, 2016 was $8.9 million, or $0.52 diluted earnings per share, as compared to $8.1 million, or $0.45 diluted earnings per share for the same period in 2015. Significantly contributing to the increase in net income was a $1.6 million increase in net interest income, a $1.3 million reduction in due diligence, merger-related and merger integration costs, and a $405 thousand decrease in the Provision. Partially offsetting these improvements was a $621 thousand increase in impairment of MSRs, a $169 thousand decrease in fees for wealth management services and increases of $1.1 million and $407 thousand in salaries and wages and furniture, fixtures and equipment expense, respectively. In addition to the effect of the increase in net income, the $0.07 increase in diluted earnings per share was also partially the result of the share repurchase which occurred between June 30, 2015 and June 30, 2016.
     
  • Net interest income for the three months ended June 30, 2016 was $26.6 million, an increase of $1.6 million, or 6.2%, from $25.0 million for the same period in 2015. The increase in net interest income was largely related to the growth in average loan balances between the periods. Average loans and leases for the three months ended June 30, 2016 increased by $294.5 million from the same period in 2015. The increase in average loan balances was offset by a 22 basis point decrease in tax-equivalent yield earned on loans and leases. The net effect of the yield decrease and volume increase on average loans and leases was a $2.1 million increase in interest income on loans. On the liability side, an $88.5 million increase in average interest-bearing deposits and a $13.4 million increase in average borrowings resulted in a $736 thousand increase in interest expense between the periods. The tax-equivalent rate paid on deposits increased 7 basis points while that of borrowings increased by 49 basis points.
     
  • The tax-equivalent net interest margin of 3.81% for the three months ended June 30, 2016 was unchanged from the same period in 2015. The contribution of fair value mark accretion to the tax equivalent net interest margin accounted for 17 basis points of the margin for the second quarter of 2016 as compared to 23 basis points for the second quarter of 2015.
     
  • Non-interest income for the three months ended June 30, 2016 decreased $357 thousand as compared to the same period in 2015. Contributing to this decrease was a $169 thousand decrease in fees for wealth management services. In addition, decreases of $75 thousand and $58 thousand in gain on sale of OREO and loan servicing and other fees, respectively, also contributed to the decrease between periods. Partially offsetting these decreases was a $118 thousand increase in gain on sale of loans.
     
  • Non-interest expense for the three months ended June 30, 2016 increased $277 thousand, to $26.3 million, as compared to $26.0 million for the same period in 2015. Factors contributing to the increase were the $1.1 million increase in salaries and wages which were related to staff additions, incentive accruals and annual increases, a $621 thousand increase in impairment of MSRs related to the quarter-end market interest rate drop, which affected prepayment speeds, and a $407 thousand increase in furniture, fixtures and equipment expense, primarily related to the depreciation of the infrastructure improvements which were completed in 2015. Partially offsetting these increases was a $1.3 million decrease in due diligence, merger-related and merger integration costs.
     
  • The Provision for the three months ended June 30, 2016 of $445 thousand was a $405 thousand decrease from the same period in 2015. Although net loan and lease charge-offs for the second quarter of 2016 increased by $68 thousand from the same period in 2015, certain metrics related to the credit quality of the loan portfolio, which included delinquency and nonperforming percentages, improved as of June 30, 2016 as compared to June 30, 2015, resulting in a lower level of Allowance.

Financial Condition – June 30, 2016 Compared to December 31, 2015

  • Total portfolio loans and leases of $2.42 billion as of June 30, 2016 increased by $154.8 million, or 6.8%, from December 31, 2015. Loan growth was concentrated in the commercial mortgage, commercial and industrial, and construction categories, which increased $91.7 million, $14.2 million and $42.9 million, respectively, since December 31, 2015.
     
  • The Allowance as of June 30, 2016 was $17.0 million, or 0.70% of portfolio loans as compared to $15.9 million, or 0.70% of portfolio loans and leases, as of December 31, 2015. In addition to the ratio of Allowance to portfolio loans, management also calculates two non-GAAP measures: the Allowance as a percentage of originated loans and leases, which was 0.81% as of June 30, 2016, as compared to 0.84% as of December 31, 2015, and the Allowance plus the remaining loan mark as a percentage of gross loans, which was 1.30% as of June 30, 2016, as compared to 1.44% as of December 31, 2015. A reconciliation of these and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.
     
  • Available for sale investment securities as of June 30, 2016 were $365.5 million, an increase of $16.5 million from December 31, 2015. Increases of $34.6 million in mortgage-related securities were partially offset by decreases of $15.4 million in U.S. government securities and $2.4 million in municipal obligations.
     
  • Total assets as of June 30, 2016 were $3.09 billion, an increase of $59.1 million from December 31, 2015. Increases in loans and leases and available for sale investment securities were partially offset by reductions in interest-bearing deposits with banks, which decreased by $104.1 million.
     
  • Wealth assets under management, administration, supervision and brokerage totaled $9.63 billion as of June 30, 2016, an increase of $1.27 billion, or 15.2%, from December 31, 2015. Despite this growth in assets, income related to these services grew only 4.9%, as more of the portfolio was comprised of assets held in lower-yielding fixed-fee accounts. Although the balances of wealth accounts whose fees are tied to their asset values are decreasing relative to the balances of fixed-fee accounts due to the strong growth of the latter, the growth in balances in the market-based accounts has been muted, in part, due to normal attrition of funds from these accounts, primarily through beneficiary spending, offsetting very solid new business development and strong account retention.  
     
  • Deposits of $2.41 billion as of June 30, 2016 increased $157.0 million from December 31, 2015. Noninterest-bearing deposits increased by $62.5 million, retail time deposits and savings deposits increased by $49.8 million and $30.6 million, respectively, and wholesale time deposits increased by $60.1 million. These increases were partially offset by a $31.6 million decrease in money market accounts.
     
  • The capital ratios for the Bank and the Corporation, as of June 30, 2016, as shown in the attached tables, indicate levels well above the regulatory minimum to be considered "well capitalized." At the Bank level, all capital ratios have increased from their December 31, 2015 levels, primarily due to increases in retained earnings, other comprehensive income and the $15.0 million capital infusion received from the Corporation in the first quarter of 2016. At the Corporation level, most capital levels remain below their December 31, 2015 levels largely due to asset growth, although most have increased from the March 31, 2016 levels.

EARNINGS CONFERENCE CALL
After discussions with many of our investors and other interested parties, the Corporation has decided to discontinue the practice of conducting the earnings conference calls beginning next quarter. As always, we will continue to be available to answer questions through our investor relations department which is listed on our website.

The Corporation will hold its second quarter 2016 earnings conference call at 8:30 a.m. Eastern Time on Friday, July 22, 2016. Interested parties may participate by dialing (toll-free) 1-877-504-8812 (international (toll) 1-412-902-6656).  A recorded replay of the conference call will be available one hour after the conclusion of the call and will remain available through August 5, 2016.  The recorded replay may be accessed by dialing (toll-free) 1-877-344-7529 (international (toll) 1-412-317-0088). The conference number is 10089216.

The conference call will be simultaneously broadcast live over the Internet through a webcast on the investor relations portion of the Bryn Mawr Bank Corporation website. To access the call, please visit the website at http://services.choruscall.com/links/bmtc160722.  An online archive of the webcast will be available within one hour of the conclusion of the call.  The Corporation has also recently expanded its Investor Relations website to include added resources and information for shareholders and interested investors.  Interested parties are encouraged to utilize the expanded resources of the site for more information on Bryn Mawr Bank Corporation.

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

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

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



Bryn Mawr Bank Corporation               
Summary Financial Information (unaudited)               
(dollars in thousands, except per share data)               
 As of or For the Three Months Ended For the Six Months Ended  
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015 June 30, 2016 June 30, 2015  
Consolidated Balance Sheet (selected items)               
Interest-bearing deposits with banks$  20,481  $  33,954  $  124,615  $  100,980  $  156,282       
Investment securities (AFS, HTM and Trading)   371,906     369,461     352,916     344,872     353,525       
Loans held for sale   11,882     7,807     8,987     8,721     15,363       
Portfolio loans and leases   2,423,821     2,378,841     2,268,988     2,228,764     2,153,263       
Allowance for loan and lease losses ("ALLL")   (17,036)    (16,845)    (15,857)    (15,935)    (14,959)      
Goodwill and other intangible assets   126,888     127,777     128,668     129,694     130,631       
Total assets   3,090,090     3,058,247     3,030,997     2,952,742     2,950,014       
Deposits - interest-bearing   1,720,477     1,700,550     1,626,041     1,634,237     1,624,257       
Deposits - non-interest-bearing   689,214     643,492     626,684     605,607     636,390       
Short-term borrowings   19,119     37,010     94,167     24,264     26,406       
Long-term FHLB advances and other borrowings   224,802     249,832     254,863     254,893     244,923       
Subordinated notes   29,505     29,491     29,479     29,466     -       
Total liabilities   2,717,623     2,693,070     2,665,286     2,584,587     2,568,916       
Shareholders' equity   372,467     365,177     365,711     368,155     381,098       
                
Average Balance Sheet (selected items)               
Interest-bearing deposits with banks$  44,950  $  39,050  $  90,832  $  165,723  $  182,099  $  42,000  $  194,328   
Investment securities (AFS, HTM and Trading)   371,153     360,957     354,239     356,028     351,080     366,055     362,571   
Loans held for sale   7,844     5,481     7,531     10,527     6,735     6,662     5,111   
Portfolio loans and leases   2,404,799     2,303,103     2,240,189     2,181,125     2,111,371     2,353,951     2,095,481   
Total interest-earning assets   2,828,746     2,708,591     2,692,791     2,713,403     2,651,285     2,768,668     2,657,491   
Goodwill and intangible assets   127,402     128,296     129,292     130,241     129,116     127,849     126,568   
Total assets   3,089,953     2,973,148     2,959,011     2,981,308     2,910,701     3,031,550     2,914,408   
Deposits - interest-bearing   1,717,252     1,633,651     1,611,574     1,644,976     1,628,759     1,675,451     1,644,456   
Short-term borrowings   32,328     34,158     26,092     28,166     34,980     33,243     45,038   
Long-term FHLB advances and other borrowings   236,248     250,015     254,880     248,606     249,678     243,131     257,963   
Subordinated notes   29,496     29,482     29,471     18,190     -     29,489     -   
Total interest-bearing liabilities   2,015,324     1,947,306     1,922,017     1,939,938     1,913,417     1,981,314     1,947,457   
Total liabilities   2,723,838     2,612,276     2,593,651     2,604,704     2,531,547     2,668,056     2,539,175   
Shareholders' equity   366,115     360,872     365,360     376,604     379,154     363,494     375,233   
                
Income Statement               
Net interest income$  26,627  $  25,902  $  25,429  $  24,833  $  25,070  $  52,529  $  49,865   
Provision for loan and lease losses   445     1,410     1,777     1,200     850     1,855     1,419   
Noninterest income   13,820     13,208     13,668     13,350     14,177     27,028     28,942   
Noninterest expense   26,259     25,051     46,951     25,403     25,982     51,310     53,411   
Income tax expense (benefit)   4,823     4,375     (3,276)    4,084     4,296     9,198     8,364   
Net income (loss)   8,920     8,274     (6,355)    7,496     8,119     17,194     15,613   
Basic earnings per share   0.53     0.49     (0.37)    0.43     0.46     1.02     0.89   
Diluted earnings per share   0.52     0.49     (0.37)    0.42     0.45     1.01     0.87   
Net income (core) (1)   8,948     8,284     7,506     8,241     8,958     17,232     17,891   
Basic earnings per share (core) (1)   0.53     0.49     0.44     0.47     0.51     1.02     1.01   
Diluted earnings per share (core) (1)   0.53     0.49     0.44     0.46     0.50     1.02     1.00   
Cash dividends paid per share   0.20     0.20     0.20     0.20     0.19     0.40     0.38   
Profitability Indicators               
Return on average assets 1.16%  1.12%  -0.86%  1.01%  1.12%  1.14%  1.08%  
Return on average equity 9.80%  9.22%  -7.00%  8.01%  8.61%  9.51%  8.39%  
Return on tangible equity (1) 16.00%  15.31%  -9.36%  13.25%  14.06%  15.66%  13.68%  
Tax-equivalent net interest margin 3.81%  3.87%  3.77%  3.65%  3.81%  3.84%  3.80%  
Efficiency ratio (1) 62.66%  61.75%  63.09%  60.97%  60.48%  62.21%  60.46%  
Mortgage Banking Information               
Mortgage loans originated$  64,893  $  52,532  $  55,867  $  76,169  $  63,285  $  117,425  $  57,467   
Residential mortgage loans sold - servicing retained   26,944     25,965     24,063     30,515     28,204     52,909     24,240   
Residential mortgage loans sold - servicing released   5,279     2,397     7,150     10,579     9,257     7,676     152   
  Total residential mortgage loans sold$  32,223  $  28,362  $  31,213  $  41,094  $  37,461  $  60,585  $  24,392   
Residential mortgage loans serviced for others$  610,418  $  605,366  $  601,939  $  601,999  $  595,440       
Share Data               
Closing share price$  29.20  $  25.73  $  28.72  $  31.07  $  30.16       
Book value per common share$  21.76  $  21.48  $  21.40  $  21.94  $  21.32       
Tangible book value per common share$  14.60  $  14.13  $  13.89  $  13.89  $  14.08       
Price / book value 134.19%  119.80%  134.19%  141.62%  141.48%      
Price / tangible book value 200.05%  182.10%  206.84%  223.67%  214.17%      
Weighted average diluted shares outstanding 17,025,037   16,883,193   17,129,234   17,834,298   18,054,663   16,954,116   17,979,426   
Shares outstanding, end of period 16,824,564   16,801,801   17,071,523   17,166,323   17,786,293       
Wealth Management Information:               
Wealth assets under mgmt, administration, supervision and brokerage (2)$  9,632,521  $  9,281,743  $  8,364,805  $  8,218,276  $  8,536,024       
Fees for wealth management services$  9,431  $  8,832  $  8,995  $  9,194  $  9,600       
Capital Ratios               
Bryn Mawr Trust Company               
Tier I capital to risk weighted assets ("RWA") 10.94%  10.69%  10.12%  11.96%  12.04%      
Total (Tier II) capital to RWA 11.65%  11.39%  10.78%  12.64%  12.71%      
Tier I leverage ratio 9.06%  9.15%  8.51%  9.75%  9.77%      
Tangible equity ratio (1) 8.79%  8.53%  7.74%  8.84%  8.77%      
Common equity Tier I capital to RWA 10.94%  10.69%  10.12%  11.96%  12.04%      
                
Bryn Mawr Bank Corporation               
Tier I capital to RWA 10.45%  10.22%  10.72%  11.56%  12.55%      
Total (Tier II) capital to RWA 12.35%  12.13%  12.61%  13.50%  13.21%      
Tier I leverage ratio 8.65%  8.76%  9.02%  9.44%  10.20%      
Tangible equity ratio (1) 8.29%  8.10%  8.17%  8.45%  9.11%      
Common equity Tier I capital to RWA 10.45%  10.22%  10.72%  11.56%  12.55%      
                
Asset Quality Indicators               
                
Net loan and lease charge-offs ("NCO"s)$  254  $  422  $  1,855  $  224  $  187  $  676  $  1,046   
Nonperforming loans and leases ("NPL"s)$  9,617  $  9,636  $  10,244  $  12,315  $  8,996       
Other real estate owned ("OREO")   784     756     2,638     1,010     843       
Total nonperforming assets ("NPA"s)$   10,401   $   10,392   $   12,882   $   13,325   $   9,839        
                
Nonperforming loans and leases 30 or more days past due$  5,599  $  6,193  $  5,678  $  8,854  $  7,302       
Performing loans and leases 30 to 89 days past due   3,564     6,296     5,601     4,960     5,233       
Performing loans and leases 90 or more days past due   -     -     -     -     -       
Total delinquent loans and leases$   9,163   $   12,489   $   11,279   $   13,814   $   12,535        
                
Delinquent loans and leases to total loans and leases 0.38%  0.52%  0.50%  0.62%  0.58%      
Delinquent performing loans and leases to total loans and leases 0.15%  0.26%  0.25%  0.22%  0.24%      
NCOs / average loans and leases (annualized) 0.04%  0.07%  0.33%  0.04%  0.04%  0.06%  0.10%  
NPLs / total portfolio loans and leases 0.40%  0.41%  0.45%  0.55%  0.42%      
NPAs / total loans and leases and OREO 0.43%  0.44%  0.56%  0.60%  0.45%      
ALLL / NPLs 177.14%  174.81%  154.79%  129.40%  166.29%      
ALLL / portfolio loans 0.70%  0.71%  0.70%  0.71%  0.69%      
ALLL on originated loans and leases / Originated loans and leases (1) 0.81%  0.83%  0.84%  0.88%  0.88%      
(Total Allowance + Loan mark) / Total Gross portfolio loans and leases (1) 1.30%  1.37%  1.44%  1.52%  1.60%      
                
Troubled debt restructurings ("TDR"s) included in NPLs$  1,779  $  1,756  $  1,935  $  3,711  $  3,960       
TDRs in compliance with modified terms   4,984     4,893     4,880     4,062     4,078       
Total TDRs$   6,763   $   6,649   $   6,815   $   7,773   $   8,038        
                
(1)Non-GAAP measure - see Appendix for Non-GAAP to GAAP reconciliation.
(2)Brokerage assets represent assets held at a registered broker dealer under a clearing agreement. 
 



Bryn Mawr Bank Corporation            
Detailed Balance Sheets (unaudited)            
(dollars in thousands)            
     
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015   
Assets            
Cash and due from banks$  13,710  $  15,594  $  18,452  $  17,161  $  20,258    
Interest-bearing deposits with banks   20,481     33,954     124,615     100,980     156,282    
  Cash and cash equivalents   34,191     49,548     143,067     118,141     176,540    
Investment securities, available for sale   365,470     365,819     348,966     341,421     349,496    
Investment securities, held to maturity   2,915     -     -     -     -    
Investment securities, trading   3,521     3,642     3,950     3,451     4,029    
Loans held for sale   11,882     7,807     8,987     8,721     15,363    
Portfolio loans and leases, originated   2,090,070     2,015,683     1,883,869     1,804,834     1,692,027    
Portfolio loans and leases, acquired   333,751     363,158     385,119     423,930     461,236    
  Total portfolio loans and leases   2,423,821     2,378,841     2,268,988     2,228,764     2,153,263    
Less: Allowance for losses on originated loan and leases   (17,008)    (16,817)    (15,857)    (15,900)    (14,937)   
Less: Allowance for losses on acquired loan and leases   (28)    (28)    -     (35)    (22)   
  Total allowance for loan and lease losses   (17,036)    (16,845)    (15,857)    (15,935)    (14,959)   
  Net portfolio loans and leases   2,406,785     2,361,996     2,253,131     2,212,829     2,138,304    
Premises and equipment   43,607     44,712     45,339     44,370     43,164    
Accrued interest receivable   8,144     8,205     7,869     7,744     7,518    
Mortgage servicing rights   4,646     5,182     5,142     5,031     4,970    
Bank owned life insurance   38,836     38,616     38,371     38,157     32,941    
Federal Home Loan Bank ("FHLB") stock   10,618     12,142     12,942     11,742     11,542    
Goodwill   104,765     104,765     104,765     104,338     104,322    
Intangible assets   22,123     23,012     23,903     25,356     26,309    
Other investments   8,722     8,487     9,460     9,499     9,295    
Other assets   23,865     24,314     25,105     21,942     26,221    
  Total assets$  3,090,090  $  3,058,247  $  3,030,997  $  2,952,742  $  2,950,014    
             
Liabilities            
Deposits            
  Noninterest-bearing$  689,214  $  643,492  $  626,684  $  605,607  $  636,390    
  Interest-bearing   1,720,477     1,700,550     1,626,041     1,634,237     1,624,257    
  Total deposits   2,409,691     2,344,042     2,252,725     2,239,844     2,260,647    
Short-term borrowings   19,119     37,010     94,167     24,264     26,406    
Long-term FHLB advances and other borrowings   224,802     249,832     254,863     254,893     244,923    
Subordinated notes   29,505     29,491     29,479     29,466     -    
Accrued interest payable   1,846     1,294     1,851     1,444     1,292    
Other liabilities   32,660     31,401     32,201     34,676     35,648    
  Total liabilities   2,717,623     2,693,070     2,665,286     2,584,587     2,568,916    
             
Shareholders' equity            
Common stock   20,972     20,949     20,931     20,854     20,848    
Paid-in capital in excess of par value   230,311     229,479     228,814     226,980     225,837    
Less: common stock held in treasury, at cost   (66,200)    (66,140)    (58,144)    (53,000)    (34,346)   
Accumulated other comprehensive income (loss), net of tax   2,488     1,502     (412)    (11,040)    (11,634)   
Retained earnings   184,896     179,387     174,522     184,361     180,393    
  Total shareholders equity   372,467     365,177     365,711     368,155     381,098    
  Total liabilities and shareholders' equity$  3,090,090  $  3,058,247  $  3,030,997  $  2,952,742  $  2,950,014    
             



Bryn Mawr Bank Corporation            
Supplemental Balance Sheet Information (unaudited)            
(dollars in thousands)            
 Portfolio Loans and Leases as of   
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015   
Commercial mortgages$  1,055,934  $  1,044,415  $  964,259  $  971,983  $  924,161    
Home equity loans and lines   202,989     205,896     209,473     212,258     211,982    
Residential mortgages   414,863     412,006     406,404     399,730     381,323    
Construction   133,313     119,193     90,421     82,820     88,122    
  Total real estate loans   1,807,099     1,781,510     1,670,557     1,666,791     1,605,588    
Commercial & Industrial   538,684     523,053     524,515     488,977     472,702    
Consumer   21,561     21,427     22,129     22,350     25,123    
Leases   56,477     52,851     51,787     50,646     49,850    
  Total non-real estate loans and leases   616,722     597,331     598,431     561,973     547,675    
  Total portfolio loans and leases$  2,423,821  $  2,378,841  $  2,268,988  $  2,228,764  $  2,153,263    
             
             
 Nonperforming Loans and Leases as of   
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015   
Commercial mortgages$  139  $  872  $  829  $  931  $  592    
Home equity loans and lines   3,011     1,953     2,027     1,661     1,605    
Residential mortgages   2,909     2,923     3,212     5,249     5,320    
Construction   -     12     34     34     139    
  Total nonperforming real estate loans   6,059     5,760     6,102     7,875     7,656    
Commercial & Industrial   3,457     3,822     4,133     4,337     1,283    
Consumer   4     -     -     2     -    
Leases   97     54     9     101     57    
  Total nonperforming non-real estate loans and leases   3,558     3,876     4,142     4,440     1,340    
  Total nonperforming portfolio loans and leases$  9,617  $  9,636  $  10,244  $  12,315  $  8,996    
             
             
 Net Loan and Lease Charge-Offs (Recoveries) for the Three Months Ended   
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015   
Commercial mortgage$  (3) $  107  $  (4) $  -  $  48    
Home equity loans and lines   11     71     561     (21)    11    
Residential   262     (35)    239     11     43    
Construction   (62)    -     (1)    (1)    (1)   
  Total net charge-offs (recoveries) of real estate loans   208     143     795     (11)    101    
Commercial & Industrial   (44)    25     902     38     (10)   
Consumer   30     20     55     26     35    
Leases   60     234     103     171     61    
  Total net charge-offs of non-real estate loans and leases   46     279     1,060     235     86    
  Total net charge-offs$  254  $  422  $  1,855  $  224  $  187    
             



Bryn Mawr Bank Corporation            
Supplemental Balance Sheet Information (unaudited)            
(dollars in thousands)            
 Investment Securities Available for Sale, at Fair Value   
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015   
U.S. Treasury securities $  102  $  102  $  101  $  102  $  101    
Obligations of the U.S. Government and agencies    86,134     96,080     101,495     91,639     93,125    
State & political subdivisions - tax-free   39,047     39,502     41,442     43,388     40,967    
State & political subdivisions - taxable   532     1,093     524     742     351    
Mortgage-backed securities   186,354     183,127     158,689     155,509     161,283    
Collateralized mortgage obligations   36,702     29,106     29,799     32,953     36,094    
Other debt securities   1,450     1,700     1,691     1,896     1,894    
Bond mutual funds   11,774     11,725     11,810     11,798     11,920    
Other investments   3,375     3,384     3,415     3,394     3,761    
  Total$  365,470  $  365,819  $  348,966  $  341,421  $  349,496    
             
             
 Unrealized Gain (Loss) on Investment Securities Available for Sale   
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015   
U.S. Treasury securities $  1  $  1  $  -  $  1  $  -    
Obligations of the U.S. Government and agencies    1,183     984     153     712     182    
State & political subdivisions - tax-free   240     173     75     153     49    
State & political subdivisions - taxable   8     18     (1)    2     1    
Mortgage-backed securities   3,958     3,026     1,267     2,591     1,542    
Collateralized mortgage obligations   496     330     43     339     223    
Other debt securities   -     -     (9)    (4)    (6)   
Bond mutual funds   (182)    (231)    (146)    (158)    (36)   
Other investments   (66)    (155)    (192)    (193)    111    
  Total$  5,638  $  4,146  $  1,190  $  3,443  $  2,066    
             
             
 Deposits   
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015   
Interest-bearing deposits:            
  Interest-bearing checking$  333,425  $  335,240  $  338,861  $  330,683  $  328,606    
  Money market   718,144     773,637     749,726     748,983     699,264    
  Savings   217,877     190,477     187,299     192,995     189,120    
  Wholesale non-maturity deposits   58,690     62,454     67,717     65,636     65,365    
  Wholesale time deposits   113,274     131,145     53,185     57,671     67,894    
  Retail time deposits    279,067     207,597     229,253     238,269     274,008    
  Total interest-bearing deposits   1,720,477     1,700,550     1,626,041     1,634,237     1,624,257    
  Noninterest-bearing deposits   689,214     643,492     626,684     605,607     636,390    
  Total deposits$  2,409,691  $  2,344,042  $  2,252,725  $  2,239,844  $  2,260,647    
             



Bryn Mawr Bank Corporation               
Detailed Income Statements (unaudited)               
(dollars in thousands, except per share data)               
 For the Three Months Ended For the Six Months Ended  
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015 June 30, 2016 June 30, 2015  
Interest income:               
Interest and fees on loans and leases$  27,679  $  26,696  $  26,080  $  25,620  $  25,568  $  54,375  $  50,732   
Interest on cash and cash equivalents   42     46     63     107     124     88     239   
Interest on investment securities:   1,565     1,527     1,623     1,302     1,301     3,092     2,776   
  Total interest income   29,286     28,269     27,766     27,029     26,993     57,555     53,747   
Interest expense:               
Interest on deposits   1,402     1,076     1,046     1,076     1,062     2,478     2,090   
Interest on short-term borrowings   20     17     9     8     10     37     31   
Interest on FHLB advances and other borrowings   867     908     912     881     851     1,775     1,761   
Interest on subordinated notes   370     366     370     231     -     736     -   
Total interest expense   2,659     2,367     2,337     2,196     1,923     5,026     3,882   
  Net interest income   26,627     25,902     25,429     24,833     25,070     52,529     49,865   
Provision for loan and lease losses (the "Provision")   445     1,410     1,777     1,200     850     1,855     1,419   
  Net interest income after Provision   26,182     24,492     23,652     23,633     24,220     50,674     48,446   
Noninterest income:               
Fees for wealth management services    9,431     8,832     8,995     9,194     9,600     18,263     18,705   
Insurance revenue   845     1,276     842     1,065     817     2,121     1,838   
Service charges on deposits   713     702     742     721     752     1,415     1,464   
Loan servicing and other fees   539     492     502     397     597     1,031     1,188   
Net gain on sale of loans   896     760     751     685     778     1,656     1,586   
Net (loss) gain on sale of investment securities available for sale   (43)    (15)    58     60     3     (58)    813   
Net (loss) gain on sale of other real estate owned   -     (76)    33     -     75     (76)    90   
Dividends on FHLB and FRB stocks   263     214     330     138     299     477     914   
Other operating income   1,176     1,023     1,415     1,090     1,256     2,199     2,344   
  Total noninterest income   13,820     13,208     13,668     13,350     14,177     27,028     28,942   
Noninterest expense:               
Salaries and wages    12,197     11,738     11,700     10,941     11,064     23,935     21,934   
Employee benefits    2,436     2,485     2,268     2,590     2,618     4,921     5,347   
Loss on pension termination   -     -     17,377     -     -     -     -   
Occupancy and bank premises   2,367     2,488     2,474     2,557     2,808     4,855     5,274   
Branch lease termination expense   -     -     929     -     -     -     -   
Furniture, fixtures and equipment   1,895     1,919     2,129     1,712     1,488     3,814     3,000   
Advertising   372     284     656     410     479     656     1,036   
Amortization of intangible assets   889     891     937     953     955     1,780     1,937   
Impairment of intangible assets   -     -     387     -     -     -     -   
Impairment (recovery) of mortgage servicing rights ("MSRs")   599     83     (17)    36     (22)    682     51   
Due diligence, merger-related and merger integration expenses   -     -     1,860     1,015     1,294     -     3,795   
Professional fees   946     813     1,010     843     827     1,759     1,500   
Pennsylvania bank shares tax   640     638     (46)    433     433     1,278     866   
Information technology   875     1,048     874     1,053     814     1,923     1,516   
Other operating expenses    3,043     2,664     4,413     2,860     3,224     5,707     7,155   
  Total noninterest expense   26,259     25,051     46,951     25,403     25,982     51,310     53,411   
Income (loss) before income taxes   13,743     12,649     (9,631)    11,580     12,415     26,392     23,977   
Income tax expense (benefit)   4,823     4,375     (3,276)    4,084     4,296     9,198     8,364   
  Net income (loss)$  8,920  $  8,274  $  (6,355) $  7,496  $  8,119  $  17,194  $  15,613   
Per share data:               
Weighted average shares outstanding   16,812,219     16,848,202     17,129,234     17,572,421     17,713,794     16,830,211     17,630,263   
Dilutive common shares   212,818     34,991     -     261,877     340,869     123,905     349,163   
Adjusted weighted average diluted shares    17,025,037     16,883,193     17,129,234     17,834,298     18,054,663     16,954,116     17,979,426   
Basic earnings (loss) per common share$  0.53  $  0.49  $  (0.37) $  0.43  $  0.46  $  1.02  $  0.89   
Diluted earnings (loss) per common share$  0.52  $  0.49  $  (0.37) $  0.42  $  0.45  $  1.01  $  0.87   
Dividend declared per share$  0.20  $  0.20  $  0.20  $  0.20  $  0.19  $  0.40  $  0.38   
Effective tax rate 35.09%  34.59%  34.02%  35.27%  34.60%  34.85%  34.88%  
                



Bryn Mawr Bank Corporation       
Tax-Equivalent Net Interest Margin (unaudited)       
(dollars in thousands, except per share data)       
  For The Three Months Ended For The Six Months Ended 
  June 30, 2016March 31, 2016December 31, 2015September 30, 2015June 30, 2015 June 30, 2016June 30, 2015 
(dollars in thousands) Average BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ Paid Average BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ Paid 
                         
Assets:                        
Interest-bearing deposits with other banks $  44,950 $  42  0.38%$  39,050 $  46  0.47%$  90,832 $  63  0.28%$  165,723 $  107  0.26%$  182,099 $  124  0.27% $  42,000 $  88  0.42%$  194,328 $  239  0.25% 
Investment securities - available for sale:                        
  Taxable    325,893    1,433  1.77%   316,353    1,397  1.78%   307,524    1,432  1.85%   310,582    1,172  1.50%   310,011    1,184  1.53%    321,123    2,838  1.78%   322,421    2,520  1.58% 
  Tax-exempt    39,193    187  1.92%   40,658    191  1.89%   43,144    195  1.79%   41,424    186  1.78%   37,035    157  1.70%    39,925    378  1.90%   36,184    360  2.01% 
  Total investment securities - available for sale     365,086    1,620  1.78%   357,011    1,588  1.79%   350,668    1,627  1.84%   352,006    1,358  1.53%   347,046    1,341  1.55%    361,048    3,216  1.79%   358,605    2,880  1.62% 
                         
Investment securities  - held to maturity    2,427    4  0.66%   -      -    -  0.00%   -    -     -    -      1,214    -      
Investment securities  - trading    3,640    2  0.22%   3,946    2  0.20%   3,571    60  6.67%   4,022    5  0.49%   4,034    11  1.09%    3,793    -     3,966    15  0.76% 
                         
Loans and leases *    2,412,643    27,761  4.63%   2,308,584    26,778  4.67%   2,247,720    26,158  4.62%   2,191,652    25,698  4.65%   2,118,106    25,623  4.85%    2,360,613    54,539  4.65%   2,100,592    50,850  4.88% 
                         
  Total interest-earning assets     2,828,746    29,429  4.18%   2,708,591    28,414  4.22%   2,692,791    27,908  4.11%   2,713,403    27,168  3.97%   2,651,285    27,099  4.10%    2,768,668    57,843  4.20%   2,657,491    53,984  4.10% 
                         
Cash and due from banks    16,413      16,501      18,005      17,160      16,222       16,457      17,649    
Less: allowance for loan and lease losses    (17,271)     (16,239)     (16,106)     (15,066)     (14,346)      (16,755)     (14,605)   
Other assets     262,065      264,295      264,321      265,811      257,540       263,180      253,873    
                         
  Total assets $  3,089,953   $  2,973,148   $  2,959,011   $  2,981,308   $  2,910,701    $  3,031,550   $  2,914,408    
                         
Liabilities:                        
                         
Interest-bearing deposits:                        
  Savings, NOW and market rate deposits $  1,273,964 $  589  0.19%$  1,279,630 $  569  0.18%$  1,260,575 $  565  0.18%$  1,260,529 $  584  0.18%$  1,224,544 $  575  0.19% $  1,276,797 $  1,158  0.18%$  1,238,399 $  1,169  0.19% 
  Wholesale deposits    196,517    361  0.74%   137,201    233  0.68%   119,394    186  0.62%   133,277    203  0.60%   130,497    195  0.60%    166,859    594  0.72%   135,282    383  0.57% 
  Retail time deposits     246,771    452  0.74%   216,820    274  0.51%   231,605    295  0.51%   251,170    289  0.46%   273,718    292  0.43%    231,795    726  0.63%   270,775    538  0.40% 
  Total interest-bearing deposits    1,717,252    1,402  0.33%   1,633,651    1,076  0.26%   1,611,574    1,046  0.26%   1,644,976    1,076  0.26%   1,628,759    1,062  0.26%    1,675,451    2,478  0.30%   1,644,456    2,090  0.26% 
                         
Borrowings:                        
Short-term borrowings    32,328    20  0.25%   34,158    17  0.20%   26,092    9  0.14%   28,166    8  0.11%   34,980    10  0.11%    33,243    37  0.22%   45,038    31  0.14% 
Long-term FHLB advances and other borrowings    236,248    867  1.48%   250,015    908  1.46%   254,880    912  1.42%   248,606    881  1.41%   249,678    851  1.37%    243,131    1,775  1.47%   257,963    1,761  1.38% 
Subordinated notes    29,496    370  5.05%   29,482    366  4.99%   29,471    370  4.98%   18,190    231  5.04%   -    -  0.00%    29,489    736  5.02%   -    -  0.00% 
  Total borrowings    298,072    1,257  1.70%   313,655    1,291  1.66%   310,443    1,291  1.65%   294,962    1,120  1.51%   284,658    861  1.21%    305,863    2,548  1.68%   303,001    1,792  1.19% 
                         
  Total interest-bearing liabilities    2,015,324    2,659  0.53%   1,947,306    2,367  0.49%   1,922,017    2,337  0.48%   1,939,938    2,196  0.45%   1,913,417    1,923  0.40%    1,981,314    5,026  0.51%   1,947,457    3,882  0.40% 
                         
Noninterest-bearing deposits    675,710      631,047      634,969      625,547      580,240       653,379      557,386    
Other liabilities    32,804      33,923      36,665      39,219      37,890       33,363      34,332    
  Total noninterest-bearing liabilities    708,514      664,970      671,634      664,766      618,130       686,742      591,718    
                         
  Total liabilities    2,723,838      2,612,276      2,593,651      2,604,704      2,531,547       2,668,056      2,539,175    
                         
Shareholders' equity     366,115      360,872      365,360      376,604      379,154       363,494      375,233    
                         
  Total liabilities and shareholders' equity  $  3,089,953   $  2,973,148   $  2,959,011   $  2,981,308   $  2,910,701    $  3,031,550   $  2,914,408    
                         
Interest income to earning assets    4.18%   4.22%   4.11%   3.97%   4.10%    4.20%   4.10% 
                         
Net interest spread    3.65%   3.73%   3.63%   3.52%   3.70%    3.69%   3.70% 
Effect of noninterest-bearing sources      0.16%     0.14%     0.14%     0.13%     0.11%      0.15%     0.10% 
                         
Tax-equivalent net interest margin   $26,770  3.81% $  26,047  3.87% $  25,571  3.77% $  24,972  3.65% $  25,176  3.81%  $  52,817  3.84% $  50,102  3.80% 
                         
Tax-equivalent adjustment   $  143  0.02% $  145  0.02% $  142  0.02% $  139  0.02% $  106  0.02%  $  288  0.02% $  237  0.02% 
                         
Supplemental Information Regarding Accretion of Fair Value Marks                  
    Interest Income (Expense) Effect Effect on Yield or Rate  Interest Income (Expense) Effect Effect on Yield or Rate  Interest Income (Expense) Effect Effect on Yield or Rate  Interest Income (Expense) Effect Effect on Yield or Rate  Interest Income (Expense) Effect Effect on Yield or Rate   Interest Income (Expense) Effect Effect on Yield or Rate  Interest Income (Expense) Effect Effect on Yield or Rate 
Loans and leases  $  1,076  0.18% $  953  0.17% $  707  0.12% $  763  0.14% $  1,246  0.24%  $  2,029  0.17% $  2,373  0.23% 
Retail time deposits     (61) -0.10%    (110) -0.20%    (123) -0.21%    (188) -0.30%    (205) -0.30%     (171) -0.15%    (450) -0.34% 
Short-term borrowings     -  0.00%    (12) -0.14%    (35) -0.53%    (35) -0.49%    (35) -0.40%     (12) -0.07%    (69) -0.31% 
Long-term FHLB advances and other borrowings     (30) -0.05%    (30) -0.05%    (30) -0.05%    (30) -0.05%    (30) -0.05%     (60) -0.05%    (66) -0.05% 
Net interest income from fair value marks  $  1,167   $  1,105   $  895   $  1,016   $  1,516    $2,272   $  2,958   
Purchase accounting effect on tax-equivalent margin   0.17%   0.16%   0.13%   0.15%   0.23%    0.17%   0.22% 
* Average loans and leases include portfolio loans and leases, and loans held for sale. Non-accrual loans are also included in the average loan and leases balances.         
                         



Bryn Mawr Bank Corporation             
Appendix - Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Performance Measures (unaudited)     
(dollars in thousands, except per share data)             
              
Statement on Non-GAAP Measures: The Corporation believes the presentation of the following non-GAAP financial measures provides useful supplemental information that is essential to an investor's proper understanding of the results of operations and financial condition of the Corporation. Management uses non-GAAP financial measures in its analysis of the Corporation's performance. These non-GAAP measures should not be viewed as substitutes for the financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.    
              
 As of or For the Three Months Ended As of or For the Six Months Ended
 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015 June 30, 2016 June 30, 2015
Reconciliation of Net Income to Net Income (core):             
Net income (loss) (a GAAP measure)$  8,920  $  8,274  $  (6,355) $  7,496  $  8,119  $  17,194  $  15,613 
Less: Tax-effected non-core noninterest income:             
  Loss (gain) on sale of investment securities available for sale   28     10     (38)    (39)    (2)    38     (528)
Add: Tax-effected non-core noninterest expense items:             
  Loss on pension termination   -     -     11,295     -     -     -     - 
  Severance expense (Salaries and wages)   -     -     142     124     -     -     - 
  Branch lease termination expense   -     -     604     -     -     -     - 
  Debt and swap prepayment penalty (Other operating expenses)   -     -     397     -     -     -     339 
  Impairment of intangible assets   -     -     252     -     -     -     - 
  Due diligence, merger-related and merger integration expenses   -     -     1,209     660     841     -     2,467 
Net income (core) (a non-GAAP measure)$   8,948   $   8,284   $   7,506   $   8,241   $   8,958   $   17,232   $   17,891  
              
Calculation of Basic and Diluted Earnings per Common Share (core):            
Weighted average common shares outstanding  16,812,219   16,848,202   17,129,234   17,572,421   17,713,794   16,830,211   17,630,263 
Dilutive common shares   214,656     63,617     112,783     261,877     340,869     124,824     349,163 
Adjusted weighted average diluted shares    17,026,875     16,911,819     17,242,017     17,834,298     18,054,663   16,955,035   17,979,426 
Basic earnings per common share (core) (a non-GAAP measure)$  0.53  $  0.49  $  0.44  $  0.47  $  0.51  $  1.02  $  1.01 
Diluted earnings per common share (core) (a non-GAAP measure)$  0.53  $  0.49  $  0.44  $  0.46  $  0.50  $  1.02  $  1.00 
              
Calculation of Return on Average Tangible Equity:             
Net income (loss)$  8,920  $  8,274  $  (6,355) $  7,496  $  8,119  $  17,194  $  15,613 
Add: Tax-effected amortization and impairment of intangible assets   578     579     861     619     621     1,157     1,259 
Net tangible income (numerator)$  9,498  $  8,853  $  (5,494) $  8,115  $  8,740  $  18,351  $  16,872 
              
Average shareholders' equity$  366,115  $  360,872  $  365,360  $  376,604  $  379,154  $  363,494  $  375,233 
Less: Average goodwill and intangible assets   (127,402)    (128,296)    (129,292)    (130,241)    (129,116)    (127,849)    (126,568)
Net average tangible equity (denominator)$  238,713  $  232,576  $  236,068  $  246,363  $  250,038  $  235,645  $  248,665 
              
Return on tangible equity (a non-GAAP measure) 16.00%  15.31%  -9.23%  13.07%  14.02%  15.66%  13.68%
              
Calculation of Tangible Equity Ratio:             
Total shareholders' equity$  372,467  $  365,177  $  365,711  $  368,155  $  381,098     
Less: Goodwill and intangible assets   (126,888)    (127,777)    (128,668)    (129,694)    (130,631)    
Net tangible equity (numerator)$  245,579  $  237,400  $  237,043  $  238,461  $  250,467     
              
Total assets$  3,090,090  $  3,058,247  $  3,030,997  $  2,952,742  $  2,950,014     
Less: Goodwill and intangible assets   (126,888)    (127,777)    (128,668)    (129,694)    (130,631)    
Tangible assets (denominator)$  2,963,202  $  2,930,470  $  2,902,329  $  2,823,048  $  2,819,383     
              
Tangible equity ratio 8.29%  8.10%  8.17%  8.45%  8.88%    
              
Calculation of Efficiency Ratio:             
Noninterest expense$  26,259  $  25,051  $  46,951  $  25,403  $  25,982  $  51,310  $  53,411 
Less: certain noninterest expense items*:             
  Loss on pension termination   -     -     (17,377)    -     -     -     - 
  Severance expense (Salaries and wages)   -     -     (218)    (191)    -     -     - 
  Branch lease termination expense   -     -     (929)    -     -     -     - 
  Debt and swap prepayment penalty (Other operating expenses)   -     -     (611)    -     -     -     (522)
  Amortization of intangibles   (889)    (891)    (937)    (953)    (955)    (1,780)    (1,937)
  Impairment of intangible assets   -     -     (388)    -     -     -     - 
  Due diligence, merger-related and merger integration  expenses   -     -     (1,860)    (1,015)    (1,294)    -     (3,795)
Noninterest expense (adjusted) (numerator)$  25,370  $  24,160  $  24,631  $  23,244  $  23,733  $  49,530  $  47,157 
              
Noninterest income$  13,820  $  13,208  $  13,668  $  13,350  $  14,177  $  27,028  $  28,942 
Less: non-core noninterest income items:             
  Loss (gain) on sale of investment securities available for sale   43     15     (58)    (60)    (3)    58     (812)
Noninterest income (core)$  13,863  $  13,223  $  13,610  $  13,290  $  14,174  $  27,086  $  28,130 
Net interest income   26,627     25,902     25,429     24,833     25,070     52,529     49,865 
Noninterest income (core) and net interest income (denominator)$  40,490  $  39,125  $  39,039  $  38,123  $  39,244  $  79,615  $  77,995 
              
Efficiency ratio 62.66%  61.75%  63.09%  60.97%  60.48%  62.21%  60.46%
* In calculating the Corporation's efficiency ratio, which is used by Management to identify the cost of generating each dollar of core revenue, certain non-core income and expense items as well as the amortization of intangible assets, are excluded.    
              
Supplemental Loan and Allowance Information Used to Calculate Non-GAAP Measures          
              
Total Allowance$  17,036  $  16,845  $  15,857  $  15,935  $  14,959     
less: Allowance on acquired loans   28