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Bryn Mawr Bank Corporation Reports Second Quarter Net Income of $14.7 Million, Continues Expansion With Domenick Acquisition, Increases Dividend 13.6% to $0.25 per share

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BRYN MAWR, Pa., July 19, 2018 (GLOBE NEWSWIRE) -- Bryn Mawr Bank Corporation (NASDAQ:BMTC) (the "Corporation"), parent of The Bryn Mawr Trust Company (the "Bank") today reported net income of $14.7 million, or $0.72 diluted earnings per share for the three months ended June 30, 2018, as compared to net income of $15.3 million, or $0.75 diluted earnings per share, for the three months ended March 31, 2018, and $9.4 million, or $0.55 diluted earnings per share, for the three months ended June 30, 2017.

On a non-GAAP basis, core net income, which excludes due diligence and merger-related expenses, income tax charges related to re-measurement of net deferred tax assets, and certain other non-core income and expense items, as detailed in the appendix to this earnings release, was $17.0 million, or $0.83 diluted earnings per share, for the three months ended June 30, 2018, as compared to $19.3 million, or $0.94 diluted earnings per share, for the three months ended March 31, 2018, and $10.2 million, or $0.59 diluted earnings per share, for the three months ended June 30, 2017. 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.

"Our strategic initiatives and the benefits from the Royal Bank merger contributed to our strong second quarter results enabling us to increase the rate of growth of our loan portfolio by over 10% on an annualized basis and expand the contribution of key areas of fee income most notably in the wealth, insurance and capital markets groups," stated Frank Leto, President and Chief Executive Officer. Adding, "We expect to continue this momentum into the coming quarters."

"As I have noted in previous quarters, the benefits of the Tax Cuts and Jobs Act provides a unique opportunity for us to evaluate our strategy and the level and pace of the investments related to its execution. As we gain more clarity around the opportunity, it is apparent to us that we are uniquely positioned to exploit the current competitive landscape and that accelerating the investments in our business is an appropriate use for a portion of the excess earnings associated with the lower tax rates." Leto continued, "To that end, we plan to invest additional resources to enhance our talent and technology with the explicit intent of improving our long-term growth trajectory, while at the same time increasing near-term shareholder return as evidenced by the increase in our quarterly dividend we announced today."

The Board of Directors of the Corporation declared a quarterly dividend of $0.25 per share, an increase of $0.03 per share from the prior quarterly dividend, payable September 1, 2018 to shareholders of record as of August 1, 2018.

SIGNIFICANT ITEMS OF NOTE

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

  • Net income for the three months ended June 30, 2018 was $14.7 million, as compared to net income of $15.3 million for the three months ended March 31, 2018. The provision for loan and lease losses (the "Provision") for the three months ended June 30, 2018 increased $2.1 million as compared to the first quarter 2018. Total noninterest income increased $539 thousand, total noninterest expense decreased $194 thousand, and income tax expense decreased $907 thousand for the three months ended June 30, 2018, as compared to the three months ended March 31, 2018.

    On a non-GAAP basis, core net income, which excludes Tax Cuts and Jobs Act ("Tax Reform") related income tax charges, due diligence and merger-related expenses and other non-core income and expense items, as detailed in the appendix to this earnings release, was $17.0 million, or $0.83 per diluted share, for the three months ended June 30, 2018, as compared to $19.3 million or $0.94 per diluted share, for the three months ended March 31, 2018. Management believes the core net income measure is important in evaluating the Corporation's performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Net interest income for the second quarter of 2018 remained relatively flat over the linked quarter ended March 31, 2018. Average interest-earning assets increased $75.1 million, primarily attributable to a $62.1 million increase of average loans and leases between the first and second quarters of 2018. The increase in interest-earning assets was accompanied by a $64.8 million increase in interest-bearing liabilities, which consisted of a $53.8 million increase of average interest-bearing deposits and an $11.0 million increase in average total borrowings between the first and second quarters of 2018.

  • Tax-equivalent net interest income for the three months ended June 30, 2018 was $37.4 million, a decrease of $96 thousand over the linked quarter. Excluding the effect of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest income increased $713 thousand between the second and first quarters of 2018.

    Tax-equivalent interest and fees on loans and leases for the three months ended June 30, 2018 increased $1.0 million over the linked quarter. Average loans and leases for the three months ended June 30, 2018 increased $62.1 million over the linked quarter and experienced a two basis point decrease in tax-equivalent yield.

    Average available for sale investment securities increased by $14.0 million over the linked quarter, and experienced a 7 basis point tax-equivalent yield increase. The increase in volume and yield on available for sale investment securities resulted in a $206 thousand increase in tax-equivalent interest income for the second quarter of 2018 as compared to the first quarter of 2018.

    Interest expense on deposits for the three months ended June 30, 2018 increased $1.0 million over the linked quarter. Average interest-bearing deposits increased $53.8 million accompanied by a 14 basis point increase in the rate paid on deposits. This increase of 14 basis points on our interest-bearing deposits was also a key driver in the decrease in the tax-equivalent net interest margin which decreased 4 basis points to 3.58% at June 30, 2018 compared to 3.62% in the linked quarter after adjusting for the impact of purchase accounting in both periods.

  • Noninterest income for the three months ended June 30, 2018 of $20.1 million increased $539 thousand from the first quarter of 2018. Items contributing to the increase included increases of $1.4 million, $350 thousand and $209 thousand in capital markets revenue, fees for wealth management services and insurance revenue, respectively.  The increases were partially offset by a $1.3 million decrease in other operating income primarily due to a $2.3 million recovery of a purchase accounting fair value mark recorded during the first quarter of 2018 as compared to a $710 thousand recovery of a purchase accounting fair value mark recorded during the second quarter of 2018.

  • Noninterest expense for the three months ended June 30, 2018 decreased $194 thousand, to $35.8 million, as compared to $36.0 million for the first quarter of 2018. The decrease on a linked quarter basis was primarily related to the decrease of $1.3 million in due diligence, merger-related and merger integration expenses. A reduction in merger-related expenses related to the Royal Bank merger was partially offset by increased merger-related expenses from the May 2018 acquisition of Domenick and Associates ("Domenick"). While much of the merger-related expenses associated with the Royal Bank merger were recorded at the time of the merger, certain expenses incurred in connection with the banking system conversion, contract terminations and lease terminations are recorded as they are incurred.

  • The Provision increased $1.0 million for the three months ended June 30, 2018 to $3.1 million, as compared the first quarter of 2018. The increase in the Provision was primarily related to the organic growth of the portfolio, and charge-offs of both collateral-dependent loans and leases that arose during the second quarter. For the three months ended June 30, 2018, net loan and lease charge-offs totaled $1.4 million, as compared to $893 thousand for the first quarter of 2018. Nonperforming loans and leases as of June 30, 2018 totaled $9.4 million, an increase of $1.9 million from March 31, 2018.

  • The effective tax rate for the second quarter of 2018 decreased to 20.2% from 23.3% for the first quarter of 2018.  The decrease was partially related to a decline in the projected effective tax rate for the year. In addition, a net discrete tax benefit of $111 thousand was recorded in the second quarter of 2018, as compared to a net discrete tax expense of $229 thousand in the first quarter of 2018. These discrete items were the result of excess tax benefits from stock-based compensation as well as the re-measurement of deferred tax items related to Tax Reform.

Results of Operations – Second Quarter 2018 Compared to Second Quarter 2017

  • Net income for the three months ended June 30, 2018 was $14.7 million, or $0.72 diluted earnings per share, as compared to $9.4 million, or diluted earnings per share of $0.55 for the same period in 2017. Contributing to the $5.3 million increase in net income was a $9.4 million increase in net interest income and increases of $1.8 million, $1.2 million, $959 thousand and $851 thousand in other operating income, capital markets revenue, insurance revenue and fees for wealth management services, respectively. These increases were partially offset by increases of $2.6 million, $1.8 million, $473 thousand and $450 thousand in salaries and wages, due diligence, merger-related and merger integration expenses, employee benefits and occupancy and bank premises expenses, respectively. These cost increases were primarily related to the addition of the Royal Bank staff and branch infrastructure and, to a lesser extent, the addition of Hirshorn Boothby in May 2017 and the establishment of our Capital Markets group in the second quarter of 2017. Also contributing to the net income increase was the reduction in our effective income tax rate as a result of Tax Reform, which decreased from 34.2% for the three months ended June 30, 2017 to 20.2% for the same period in 2018.

    On a non-GAAP basis, core net income, which excludes Tax Reform-related income tax charges, due diligence and merger-related expenses and other non-core income and expense items, as detailed in the appendix to this earnings release, was $17.0 million, or $0.83 per diluted share, for the three months ended June 30, 2018 as compared to $10.2 million, or $0.59 per diluted share, for the same period in 2017. 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.
  • Tax-equivalent net interest income for the three months ended June 30, 2018 was $37.4 million, an increase of $9.2 million over the same period in 2017.

    Tax-equivalent interest and fees on loans and leases increased $12.5 million for the three months ended June 30, 2018 as compared to the same period in 2017.  Average loans and leases for the second quarter of 2018 increased $737.7 million from the same period in 2017 and experienced a 51 basis point increase in tax-equivalent yield.  Excluding the effect of the accretion of purchase accounting fair value marks on loans and leases, the adjusted tax-equivalent yield on loans and leases increased by 34 basis points between the second quarters of 2018 and 2017. The increase in average loans and leases for the second quarter of 2018 as compared to the same period in 2017 related to the loans and leases acquired in the Royal Bank merger which initially increased loans and leases by $567.3 million, as well as organic loan growth during the period.

    Average available for sale investment securities increased by $113.1 million for the three months ended June 30, 2018 as compared to the same period in 2017, and experienced a 24 basis point tax-equivalent yield increase. The increase in volume and yield on available for sale investment securities resulted in a $891 thousand increase in tax-equivalent interest income on available for sale investment securities for the second quarter of 2018 as compared to the same period in 2017.

    Partially offsetting the effect on net interest income associated with the increase in average loans and leases and available for sale investment securities was a $2.5 million increase in interest expense on deposits for the second quarter of 2018 as compared to the same period in 2017. Average interest-bearing deposits increased by $635.6 million, accompanied by a 29 basis point increase in rate paid between the second quarters of 2018 and 2017. The increase in average interest-bearing deposits between the second quarters of 2018 and 2017 was largely related to the interest-bearing deposits assumed in the Royal Bank merger, which initially totaled $494.8 million.

    In addition to the increased interest expense on deposits, a $556 thousand increase in interest expense on long- and short-term borrowings between the periods was attributed to a $36.9 million increase in average long- and short-term borrowings coupled with a 130 basis point increase in rate paid on long- and short-term borrowings for the three months ended June 30, 2018 as compared to the same period in 2017.

    Average subordinated notes for the three months ended June 30, 2018 increased $68.9 million as compared to the same period in 2017 with the rate paid decreasing by 36 basis points to 4.66% for the three months ended June 30, 2018.  The volume increase in subordinated notes was the result of the December 13, 2017 issuance of $70 million ten-year, 4.25% fixed-to-floating subordinated notes. Average junior subordinated debentures for the three months ended June 30, 2018 increased $21.5 million compared to the same period in 2017 as the Corporation acquired $21.4 million of floating rate junior subordinated debentures, currently at a 6.00% rate, in the Royal Bank merger.  The volume increase in both subordinated debt types and rate decrease in the subordinated notes in the second quarter of 2018 resulted in an increase in interest expense on subordinated notes and junior subordinated debentures of $773 thousand and $321 thousand, respectively, for the three months ended June 30, 2018 as compared to the same period in 2017.
  • The tax-equivalent net interest margin was 3.81% for the three months ended June 30, 2018 as compared to 3.68% for the same period in 2017. Adjusting for the impact of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest margin was 3.58% and 3.62% for three months ended June 30, 2018 and 2017, respectively. Key drivers responsible for the decrease four basis point decrease included the 29 basis point increase in rate paid on interest-bearing deposits coupled with increases of $68.9 million and $21.5 million in average subordinated notes and average junior subordinated debentures, respectively for the three months ended June 30, 2018 as compared to the same period in 2017.

  • Noninterest income for the three months ended June 30, 2018 increased by $5.3 million, to $20.1 million, from the same period in 2017. Increases of $1.8 million, $1.2 million, $959 thousand and $851 thousand in other operating income, capital markets revenue, insurance revenue and fees for wealth management services, respectively, were recorded. The increase in fees for wealth management services related to the $1.35 billion increase in wealth assets under management, administration, supervision and brokerage between June 30, 2018 and June 30, 2017. The increase in insurance commissions was primarily related to the May 2017 acquisition of Hirshorn Boothby and, to a lesser extent, the May 2018 acquisition of Domenick which further expanded our insurance division into the City of Philadelphia. Our Capital Markets group, which began operations in the second quarter of 2017, contributed significantly to our noninterest income totals. The $1.8 million increase in other operating income was primarily related to a $710 thousand recovery of a purchase accounting fair value mark resulting from the pay off, in full, of a purchased credit impaired loan acquired in the Royal Bank merger and a $310 thousand recovery during the second quarter of 2018 of loans and leases previously charged-off by Royal Bank.

  • Noninterest expense for the three months ended June 30, 2018 increased $7.3 million, to $35.8 million, from the same period in 2017. A majority of the increase related to the additional expenses associated with the staff and facilities assumed in the Royal Bank merger. In addition, the May 2017 acquisition of Hirshorn Boothby, the formation of our Capital Markets group in the second quarter of 2017, and, to a lesser extent, the May 2018 acquisition of Domenick contributed to the increase in noninterest expense. Due diligence, merger-related and merger integration expenses also experienced an increase of $1.8 million for the three months ended June 30, 2018 as compared to the same period in 2017, primarily related to the Royal Bank merger and the May 2018 acquisition of Domenick.

  • The Provision increased $3.2 million for the three months ended June 30, 2018 as compared to the same period in 2017. The increase in the Provision was primarily related to the organic growth of the portfolio, charge-offs of both collateral-dependent loans and non-performing leases that arose during the second quarter and to a lesser extent, adjustments in certain qualitative factors. Net charge-offs for the second quarter of 2018 were $1.4 million as compared to $625 thousand for the same period in 2017. Nonperforming loans and leases as of June 30, 2018 totaled $9.4 million, an increase of $2.2 million from June 30, 2017.

  • The effective tax rate for the second quarter of 2018 decreased to 20.2% from 34.2% for the second quarter of 2017, primarily due to the reduced tax rates as a result of Tax Reform.

Financial Condition – June 30, 2018 Compared to December 31, 2017

  • Total assets as of June 30, 2018 were $4.39 billion, a decrease of $55.5 million from December 31, 2017. Increases in portfolio loans and leases were largely offset by a decrease in available for sale investment securities discussed in the bullet point below.

  • Available for sale investment securities as of June 30, 2018 totaled $531.1 million, a decrease of $158.1 million from December 31, 2017. The decrease between the two periods is primarily due to the maturing, in January 2018, of $200 million of short-term U.S. Treasury bills, partially offset by increases of $32.2 million and $17.6 million in the U.S. government and agencies and the mortgage-backed securities segments of the portfolio, respectively.

  • Total portfolio loans and leases of $3.39 billion as of June 30, 2018 increased by $103.6 million from December 31, 2017, an increase of 3.2%. Increases of $90.3 million, $26.0 million, $17.2 million and $13.3 million in commercial mortgages, commercial and industrial loans, leases, and consumer loans, respectively, were offset by decreases of $21.6 million, $11.8 million and $9.8 million in construction loans, home equity loans and lines and residential mortgages, respectively, between the dates.

  • The allowance for loan and lease losses (the "Allowance") as of June 30, 2018 was $19.4 million, or 0.57% of portfolio loans and leases, as compared to $17.5 million, or 0.53% of portfolio loans and leases as of December 31, 2017. In addition to the ratio of Allowance to portfolio loans and leases, management also calculates two non-GAAP measures: the Allowance of originated loans and leases as a percentage of originated loans and leases, which was 0.71% as of June 30, 2018, as compared to 0.70% as of December 31, 2017, and the Allowance plus the remaining loan mark as a percentage of gross loans, which was 1.35% as of June 30, 2018, as compared to 1.58% as of December 31, 2017. A reconciliation of these and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Deposits of $3.36 billion as of June 30, 2018 decreased $14.9 million from December 31, 2017. Decreases of $48.1 million, $46.7 million, $25.5 million, and $32.5 million in money market accounts, savings accounts, wholesale non-maturity deposits, and noninterest-bearing deposits, respectively, were partially offset by a $135.9 million increase in interest-bearing demand accounts.

  • Borrowings of $434.9 million as of June 30, 2018, which include short-term borrowings, long-term FHLB advances, subordinated notes and junior subordinated debentures, decreased $62.0 million from December 31, 2017. The decrease was comprised of a $51.3 million decrease in long-term FHLB advances, and a $10.8 million decrease in short-term borrowings.

  • Wealth assets under management, administration, supervision and brokerage totaled $13.40 billion as of June 30, 2018, an increase of $436.0 million from December 31, 2017.

  • The capital ratios for the Bank and the Corporation, as of June 30, 2018, as shown in the attached tables, indicate levels above the regulatory minimum to be considered "well capitalized."

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

Such forward-looking statements involve known and unknown risks and uncertainties.   A number of factors, many of which are beyond the Corporation's control, could cause our actual results, events or developments, or industry results, to be materially different from any future results, events or developments expressed, implied or anticipated by such forward-looking statements, and so our business and financial condition and results of operations could be materially and adversely affected. Such factors include, among others, our inability to successfully integrate acquired businesses, the possibility that integration may take longer than anticipated or be more costly to complete and that the anticipated benefits, including any anticipated cost savings or strategic gains may be significantly harder to achieve or take longer than anticipated or may not be achieved, our need for capital, our ability to control operating costs and expenses, and to manage loan and lease delinquency rates; the credit risks of lending activities and overall quality of the composition of our loan, lease and securities portfolio; the impact of economic conditions, consumer and business spending habits, and real estate market conditions on our business and in our market area; changes in the levels of general interest rates, deposit interest rates, or net interest margin and funding sources; changes in banking regulations and policies and the possibility that any banking agency approvals we might require for certain activities will not be obtained in a timely manner or at all or will be conditioned in a manner that would impair our ability to implement our business plans; changes in accounting policies and practices; 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,
2018
  March 31,
2018
  December 31,
2017
  September 30,
2017
  June 30,
2017
  June 30,
2018
  June 30,
2017
Consolidated Balance Sheet (selected items)                          
Interest-bearing deposits with banks $ 39,924     $ 24,589     $ 48,367     $ 36,870     $ 30,806          
Investment securities 547,088     550,199     701,744     482,399     452,869          
Loans held for sale 4,204     5,522     3,794     6,327     8,590          
Portfolio loans and leases 3,389,501     3,305,795     3,285,858     2,677,345     2,666,651          
Allowance for loan and lease losses ("ALLL") (19,398 )   (17,662 )   (17,525 )   (17,004 )   (16,399 )        
Goodwill and other intangible assets 208,139     207,287     205,855     128,534     129,211          
Total assets 4,394,203     4,300,376     4,449,720     3,476,821     3,438,219          
Deposits - interest-bearing 2,466,529     2,452,421     2,448,954     1,923,567     1,863,288          
Deposits - non-interest-bearing 892,386     863,118     924,844     760,614     818,475          
Short-term borrowings 227,059     173,704     237,865     180,874     130,295          
Long-term FHLB advances 87,808     107,784     139,140     134,651     164,681          
Subordinated notes 98,491     98,448     98,416     29,573     29,559          
Jr. subordinated debentures 21,497     21,456     21,416                  
Total liabilities 3,851,700     3,767,315     3,921,601     3,074,929     3,043,242          
Total shareholders' equity 542,503     533,061     528,119     401,892     394,977          
Average Balance Sheet (selected items)                          
Interest-bearing deposits with banks 37,215     38,044     43,962     26,628     26,266     37,627     32,931  
Investment securities 549,249     535,471     499,968     462,700     429,400     542,398     411,453  
Loans held for sale 4,413     2,848     3,966     3,728     3,855     3,635     4,045  
Portfolio loans and leases 3,348,926     3,288,364     2,801,289     2,676,589     2,611,755     3,318,812     2,581,764  
Total interest-earning assets 3,939,803     3,864,727     3,349,185     3,169,645     3,071,276     3,902,472     3,030,193  
Goodwill and intangible assets 208,039     205,529     142,652     128,917     126,537     206,790     125,715  
Total assets 4,344,541     4,246,180     3,640,667     3,441,906     3,333,307     4,295,637     3,288,928  
Deposits - interest-bearing 2,489,296     2,435,491     2,031,170     1,871,494     1,853,660     2,464,618     1,852,931  
Short-term borrowings 205,323     172,534     180,650     182,845     98,869     189,019     73,378  
Long-term FHLB advances 102,023     123,920     134,605     155,918     171,567     112,911     177,006  
Subordinated notes 98,463     98,430     43,844     29,564     29,550     98,447     29,544  
Jr. subordinated debentures 21,470     21,430     3,957             21,450      
Total interest-bearing liabilities 2,916,575     2,851,805     2,394,226     2,239,821     2,153,646     2,886,445     2,132,859  
Total liabilities 3,810,640     3,719,746     3,213,349     3,044,549     2,943,591     3,769,498     2,902,942  
Total shareholders' equity 533,901     526,434     427,318     397,357     389,716     526,139     385,986  


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,
2018
  March 31,
2018
  December 31,
2017
  September 30,
2017
  June 30,
2017
  June 30,
2018
  June 30,
2017
Income Statement                          
Net interest income $ 37,316     $ 37,439     $ 30,321     $ 29,438     $ 27,965     $ 74,755     $ 55,368  
Provision for loan and lease losses 3,137     1,030     1,077     1,333     (83 )   4,167     208  
Noninterest income 20,075     19,536     15,536     15,584     14,785     39,611     28,012  
Noninterest expense 35,836     36,030     31,056     28,184     28,495     71,866     55,155  
Income tax expense 3,723     4,630     19,924     4,766     4,905     8,353     9,540  
Net income 14,695     15,285     (6,200 )   10,739     9,433     29,980     18,477  
Net income (loss) attributable to noncontrolling interest 7     (1 )               6      
Net income (loss) attributable to Bryn Mawr Bank Corporation 14,688     15,286     (6,200 )   10,739     9,433     29,974     18,477  
Basic earnings per share 0.73     0.76     (0.35 )   0.63     0.56     1.48     1.09  
Diluted earnings per share 0.72     0.75     (0.35 )   0.62     0.55     1.47     1.07  
Net income (core) (1) 17,031     19,282     11,255     11,245     10,236     36,313     19,612  
Basic earnings per share (core) (1) 0.84     0.95     0.64     0.66     0.60     1.80     1.16  
Diluted earnings per share (core) (1) 0.83     0.94     0.63     0.65     0.59     1.78     1.14  
Dividends paid or accrued per share 0.22     0.22     0.22     0.22     0.21     0.44     0.42  
Profitability Indicators                          
Return on average assets 1.36 %   1.46 %   (0.68 )%   1.24 %   1.14 %   1.41 %   1.13 %
Return on average equity 11.03 %   11.78 %   (5.76 )%   10.72 %   9.71 %   11.49 %   9.65 %
Return on tangible equity(1) 18.90 %   20.15 %   (8.02 )%   16.52 %   15.06 %   19.77 %   15.01 %
Return on tangible equity (core)(1) 21.78 %   25.19 %   16.29 %   17.27 %   16.28 %   23.76 %   15.89 %
Return on average assets (core)(1) 1.57 %   1.84 %   1.23 %   1.30 %   1.23 %   1.70 %   1.20 %
Return on average equity (core)(1) 12.79 %   14.85 %   10.45 %   11.23 %   10.53 %   13.92 %   10.25 %
Tax-equivalent net interest margin 3.81 %   3.94 %   3.62 %   3.71 %   3.68 %   3.87 %   3.71 %
Efficiency ratio(1) 55.57 %   54.12 %   58.64 %   59.30 %   62.16 %   54.85 %   62.40 %
Share Data                          
Closing share price $ 46.30     $ 43.95     $ 44.20     $ 43.80     $ 42.50          
Book value per common share $ 26.80     $ 26.35     $ 26.19     $ 23.57     $ 23.25          
Tangible book value per common share $ 16.55     $ 16.14     $ 16.02     $ 16.03     $ 15.64          
Price / book value 172.76 %   166.79 %   168.74 %   185.82 %   182.81 %        
Price / tangible book value 279.74 %   272.35 %   275.94 %   273.19 %   271.69 %        
Weighted average diluted shares outstanding 20,447,360     20,450,494     17,844,672     17,253,982     17,232,767     20,442,717     17,207,812  
Shares outstanding, end of period 20,242,893     20,229,896     20,161,395     17,050,151     16,989,849          
Wealth Management Information:                          
Wealth assets under mgmt, administration, supervision and brokerage (2) $ 13,404,723     $ 13,146,926     $ 12,968,738     $ 12,431,370     $ 12,050,555          
Fees for wealth management services $ 10,658     $ 10,308     $ 9,974     $ 9,651     $ 9,807          


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,
2018
  March 31,
2018
  December 31,
2017
  September 30,
2017
  June 30,
2017
  June 30,
2018
  June 30,
2017
Capital Ratios                          
Bryn Mawr Trust Company ("BMTC")                          
Tier I capital to risk weighted assets ("RWA") (3) 11.32 %   11.29 %   11.10 %   10.78 %   10.29 %        
Total capital to RWA (3) 11.89 %   11.82 %   11.65 %   11.42 %   10.90 %        
Tier I leverage ratio (3) 9.49 %   9.39 %   10.76 %   8.79 %   8.76 %        
Tangible equity ratio (1)(3) 9.27 %   9.19 %   8.67 %   8.46 %   8.24 %        
Common equity Tier I capital to RWA (3) 11.32 %   11.29 %   11.10 %   10.78 %   10.29 %        
                           
Bryn Mawr Bank Corporation ("BMBC")                          
Tier I capital to RWA (3) 10.44 %   10.46 %   10.42 %   10.50 %   10.10 %        
Total capital to RWA (3) 13.84 %   13.93 %   13.92 %   12.23 %   11.79 %        
Tier I leverage ratio (3) 8.75 %   8.71 %   10.10 %   8.53 %   8.63 %        
Tangible equity ratio (1)(3) 8.00 %   7.98 %   7.61 %   8.16 %   8.03 %        
Common equity Tier I capital to RWA (3) 9.84 %   9.85 %   9.87 %   10.50 %   10.10 %        
                           
Asset Quality Indicators                          
Net loan and lease charge-offs ("NCO"s) $ 1,401     $ 893     $ 556     $ 728     $ 625     $ 3,578     $ 1,295  
                           
Nonperforming loans and leases ("NPL"s) $ 9,448     $ 7,533     $ 8,579     $ 4,472     $ 7,237          
Other real estate owned ("OREO") 531     300     304     865     1,122          
Total nonperforming assets ("NPA"s) $ 9,979     $ 7,833     $ 8,883     $ 5,337     $ 8,359          
                           
Nonperforming loans and leases 30 or more days past due $ 6,749     $ 5,775     $ 6,983     $ 2,337     $ 4,076          
Performing loans and leases 30 to 89 days past due 10,378     6,547     7,958     4,558     6,258          
Performing loans and leases 90 or more days past due                          
Total delinquent loans and leases $ 17,127     $ 12,322     $ 14,941     $ 6,895     $ 10,334          
                           
Delinquent loans and leases to total loans and leases 0.50 %   0.37 %   0.45 %   0.26 %   0.39 %        
Delinquent performing loans and leases to total loans and leases 0.31 %   0.20 %   0.24 %   0.17 %   0.23 %        
NCOs / average loans and leases (annualized) 0.17 %   0.11 %   0.08 %   0.11 %   0.10 %   0.22 %   0.10 %
NPLs / total portfolio loans and leases 0.28 %   0.23 %   0.26 %   0.17 %   0.27 %        
NPAs / total loans and leases and OREO 0.29 %   0.24 %   0.27 %   0.20 %   0.31 %        
NPAs / total assets 0.23 %   0.18 %   0.20 %   0.15 %   0.24 %        
ALLL / NPLs 205.31 %   234.46 %   204.28 %   380.23 %   226.60 %        
ALLL / portfolio loans 0.57 %   0.53 %   0.53 %   0.64 %   0.61 %        
ALLL on originated loans and leases / Originated loans and leases (1) 0.71 %   0.69 %   0.70 %   0.70 %   0.68 %        
(Total ALLL + Loan mark) / Total Gross portfolio loans and leases (1) 1.35 %   1.50 %   1.58 %   1.01 %   1.03 %        
                           
Troubled debt restructurings ("TDR"s) included in NPLs $ 1,044     $ 1,125     $ 3,289     $ 2,033     $ 2,470          
TDRs in compliance with modified terms 4,117     5,235     5,800     6,597     6,148          
Total TDRs $ 5,161     $ 6,360     $ 9,089     $ 8,630     $ 8,618          

(1)  Non-GAAP measure - see Appendix for Non-GAAP to GAAP reconciliation.
(2)  Brokerage assets represent assets held at a registered broker dealer under a clearing agreement.
(3)  Capital Ratios for the current quarter are to be considered preliminary until the Call Reports are filed.


Bryn Mawr Bank Corporation                  
Detailed Balance Sheets (unaudited)                  
(dollars in thousands)                  
                   
  June 30,
2018
  March 31,
2018
  December 31,
2017
  September 30,
2017
  June 30,
2017
Assets                  
Cash and due from banks $ 7,318     $ 7,804     $ 11,657     $ 8,682     $ 19,352  
Interest-bearing deposits with banks 39,924     24,589     48,367     36,870     30,806  
Cash and cash equivalents 47,242     32,393     60,024     45,552     50,158  
Investment securities, available for sale 531,075     534,103     689,202     471,721     443,687  
Investment securities, held to maturity 7,838     7,885     7,932     6,255     5,161  
Investment securities, trading 8,175     8,211     4,610     4,423     4,021  
Loans held for sale 4,204     5,522     3,794     6,327     8,590  
Portfolio loans and leases, originated 2,700,815     2,564,827     2,487,296     2,433,054     2,409,964  
Portfolio loans and leases, acquired 688,686     740,968     798,562     244,291     256,687  
Total portfolio loans and leases 3,389,501     3,305,795     3,285,858     2,677,345     2,666,651  
Less: Allowance for losses on originated loan and leases (19,181 )   (17,570 )   (17,475 )   (16,957 )   (16,374 )
Less: Allowance for losses on acquired loan and leases (217 )   (92 )   (50 )   (47 )   (25 )
Total allowance for loan and lease losses (19,398 )   (17,662 )   (17,525 )   (17,004 )   (16,399 )
Net portfolio loans and leases 3,370,103     3,288,133     3,268,333     2,660,341     2,650,252  
Premises and equipment 54,185     54,986     54,458     44,544     44,446  
Accrued interest receivable 13,115     12,521     14,246     9,287     8,717  
Mortgage servicing rights 5,511     5,706     5,861     5,732     5,683  
Bank owned life insurance 57,243     56,946     56,667     39,881     39,680  
Federal Home Loan Bank ("FHLB") stock 16,678     15,499     20,083     16,248     15,168  
Goodwill 183,162     182,200     179,889     107,127     107,127  
Intangible assets 24,977     25,087     25,966     21,407     22,084  
Other investments 16,774     11,720     12,470     8,941     8,682  
Other assets 53,921     59,464     46,185     29,035     24,763  
Total assets $ 4,394,203     $ 4,300,376     $ 4,449,720     $ 3,476,821     $ 3,438,219  
                   
Liabilities                  
Deposits                  
Noninterest-bearing $ 892,386     $ 863,118     $ 924,844     $ 760,614     $ 818,475  
Interest-bearing 2,466,529     2,452,421     2,448,954     1,923,567     1,863,288  
Total deposits 3,358,915     3,315,539     3,373,798     2,684,181     2,681,763  
Short-term borrowings 227,059     173,704     237,865     180,874     130,295  
Long-term FHLB advances 87,808     107,784     139,140     134,651     164,681  
Subordinated notes 98,491     98,448     98,416     29,573     29,559  
Jr. subordinated debentures 21,497     21,456     21,416          
Accrued interest payable 5,230     4,814     3,527     2,267     2,830  
Other liabilities 52,700     45,570     47,439     43,383     34,114  
Total liabilities 3,851,700     3,767,315     3,921,601     3,074,929     3,043,242  
                   
Shareholders' equity                  
Common stock 24,453     24,439     24,360     21,248     21,162  
Paid-in capital in excess of par value 372,227     371,319     371,486     235,412     234,654  
Less: common stock held in treasury, at cost (68,943 )   (68,787 )   (68,179 )   (68,134 )   (67,091 )
Accumulated other comprehensive (loss) income, net of tax (11,191 )   (9,664 )   (4,414 )   (1,400 )   (1,564 )
Retained earnings 226,635     216,438     205,549     214,766     207,816  
Total Bryn Mawr Bank Corporation shareholders' equity 543,181     533,745     528,802     401,892     394,977  
Noncontrolling interest (678 )   (684 )   (683 )        
Total shareholders' equity 542,503     533,061     528,119     401,892     394,977  
Total liabilities and shareholders' equity $ 4,394,203     $ 4,300,376     $ 4,449,720     $ 3,476,821     $ 3,438,219  


Bryn Mawr Bank Corporation  
Supplemental Balance Sheet Information (unaudited)  
(dollars in thousands)  
   
  Portfolio Loans and Leases as of
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
Commercial mortgages $ 1,613,721     $ 1,541,457     $ 1,523,377     $ 1,224,571     $ 1,197,936  
Home equity loans and lines 206,429     211,469     218,275     206,974     208,480  
Residential mortgages 449,060     453,655     458,886     422,524     416,488  
Construction 190,874     202,168     212,454     133,505     156,581  
Total real estate loans 2,460,084     2,408,749     2,412,992     1,987,574     1,979,485  
Commercial & Industrial 745,306     727,231     719,312     597,595     599,203  
Consumer 51,462     48,423     38,153     31,306     28,485  
Leases 132,649     121,392     115,401     60,870     59,478  
Total non-real estate loans and leases 929,417     897,046     872,866     689,771     687,166  
Total portfolio loans and leases $ 3,389,501     $ 3,305,795     $ 3,285,858     $ 2,677,345     $ 2,666,651  
                                       
  Nonperforming Loans and Leases as of
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
Commercial mortgages $ 1,010     $ 138     $ 872     $ 193     $ 818  
Home equity loans and lines 2,323     1,949     1,481     613     1,535  
Residential mortgages 2,647     2,603     4,417     1,589     2,589  
Total nonperforming real estate loans 5,980     4,690     6,770     2,395     4,942  
Commercial & Industrial 1,585     2,499     1,706     1,977     2,112  
Consumer                 10  
Leases 1,883     344     103     100     173  
Total nonperforming non-real estate loans and leases 3,468     2,843     1,809     2,077     2,295  
Total nonperforming portfolio loans and leases $ 9,448     $ 7,533     $ 8,579     $ 4,472     $ 7,237  
                                       
  Net Loan and Lease Charge-Offs (Recoveries) for the Three Months Ended
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
Commercial mortgage $ 13     $ (3 )   $ 51     $ (3 )   $ (3 )
Home equity loans and lines 199     25     (5 )   69     169  
Residential (1 )       88     3     43  
Construction (1 )   (1 )   (1 )   (1 )   (1 )
Total net charge-offs of real estate loans 210     21     133     68     208  
Commercial & Industrial 467     283     125     298     185  
Consumer 41     48     55     36     16  
Leases 683     541     243     326     216  
Total net charge-offs of non-real estate loans and leases 1,191     872     423     660     417  
Total net charge-offs $ 1,401     $ 893     $ 556     $ 728     $ 625  
                                       
   
  Investment Securities Available for Sale, at Fair Value
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
U.S. Treasury securities $ 100     $ 100     $ 200,088     $ 100     $ 100  
Obligations of the U.S. Government and agencies 183,256     175,107     151,044     142,711     126,468  
State & political subdivisions - tax-free 17,254     19,746     21,138     23,556     26,958  
State & political subdivisions - taxable 171     171     172     524     524  
Mortgage-backed securities 292,563     303,902     274,990     260,680     230,617  
Collateralized mortgage obligations 36,634     33,980     36,662     39,595     42,549  
Other debt securities 1,097     1,097     1,599     1,100     1,099  
Bond mutual funds                 11,956  
Other investments         3,509     3,455     3,416  
Total investment securities available for sale, at fair value $ 531,075     $ 534,103     $ 689,202     $ 471,721     $ 443,687  
                                       
  Unrealized Gain (Loss) on Investment Securities Available for Sale
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
U.S. Treasury securities $     $     $ 11     $     $  
Obligations of the U.S. Government and agencies (4,594 )   (3,756 )   (1,984 )   (920 )   (699 )
State & political subdivisions - tax-free (57 )   (74 )   (42 )   23     11  
State & political subdivisions - taxable (1 )   (1 )       1     1  
Mortgage-backed securities (6,141 )   (5,169 )   (968 )   869     480  
Collateralized mortgage obligations (1,443 )   (1,322 )   (934 )   (640 )   (662 )
Other debt securities (3 )   (3 )   (1 )       (1 )
Other investments         296     230     203  
Total unrealized (losses) gains on investment securities available for sale $ (12,239 )   $ (10,325 )   $ (3,622 )   $ (437 )   $ (667 )
                                       
  Deposits
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
Interest-bearing deposits:                  
Interest-bearing demand $ 617,258     $ 529,478     $ 481,336     $ 395,383     $ 381,345  
Money market 814,530     856,072     862,639     720,613     729,859  
Savings 291,858     308,925     338,572     264,273     254,903  
Retail time deposits 536,287     523,138     532,202     316,068     321,982  
Wholesale non-maturity deposits 36,826     63,449     62,276     48,620     54,675  
Wholesale time deposits 169,770     171,359     171,929     178,610     120,524  
Total interest-bearing deposits 2,466,529     2,452,421     2,448,954     1,923,567     1,863,288  
Noninterest-bearing deposits 892,386     863,118     924,844     760,614     818,475  
Total deposits $ 3,358,915     $ 3,315,539     $ 3,373,798     $ 2,684,181     $ 2,681,763  
                                       

 

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,
2018
  March 31,
2018
  December 31,
2017
  September 30,
2017
  June 30,
2017
  June 30,
2018
  June 30,
2017
Interest income:                          
Interest and fees on loans and leases $ 41,689     $ 40,689     $ 32,245     $ 30,892     $ 29,143     $ 82,378     $ 57,625  
Interest on cash and cash equivalents 64     53     37     36     35     117     101  
Interest on investment securities 3,001     2,792     2,516     2,270     2,059     5,793     3,837  
Total interest income 44,754     43,534     34,798     33,198     31,237     88,288     61,563  
Interest expense:                          
Interest on deposits 4,499     3,472     2,739     2,198     1,983     7,971     3,811  
Interest on short-term borrowings 985     630     579     547     237     1,615     264  
Interest on FHLB advances and other borrowings 490     562     595     645     682     1,052     1,380  
Interest on jr. subordinated debentures 321     288     46             609      
Interest on subordinated notes 1,143     1,143     518     370     370     2,286     740  
Total interest expense 7,438     6,095     4,477     3,760     3,272     13,533     6,195  
Net interest income 37,316     37,439     30,321     29,438     27,965     74,755     55,368  
Provision for (recovery of) loan and lease losses (the "Provision") 3,137     1,030     1,077     1,333     (83 )   4,167     208  
Net interest income after Provision 34,179     36,409     29,244     28,105     28,048     70,588     55,160  
Noninterest income:                          
Fees for wealth management services 10,658     10,308     9,974     9,651     9,807     20,966     19,110  
Insurance revenue 1,902     1,693     1,510     1,373     943     3,595     1,706  
Capital markets revenue 2,105     666     600     843     953     2,771     953  
Service charges on deposits 752     713     655     676     630     1,465     1,277  
Loan servicing and other fees 475     686     536     548     519     1,161     1,022  
Net gain on sale of loans 528     518     493     799     520     1,046     1,149  
Net gain on sale of investment securities available for sale     7     28     72         7     1  
Net gain (loss) on sale of other real estate owned 111     176     (92 )       (12 )   287     (12 )
Dividends on FHLB and FRB stocks 510     431     290     217     218     941     432  
Other operating income 3,034     4,338     1,542     1,405     1,207     7,372     2,374  
Total noninterest income 20,075     19,536     15,536     15,584     14,785     39,611     28,012  
Noninterest expense:                          
Salaries and wages 16,240     15,982     13,619     13,602     13,580     32,222     26,030  
Employee benefits 2,877     3,708     2,717     2,560     2,404     6,585     4,893  
Occupancy and bank premises 2,697     3,050     2,648     2,485     2,247     5,747     4,773  
Furniture, fixtures and equipment 2,069     1,898     1,816     1,726     1,869     3,967     3,843  
Advertising 369     461     386     277     405     830     791  
Amortization of intangible assets 889     879     677     677     687     1,768     1,380  
(Recovery) impairment of mortgage servicing rights ("MSRs") (1 )   (50 )   (94 )   3     43     (51 )   46  
Due diligence, merger-related and merger integration expenses 3,053     4,319     3,507     850     1,236     7,372     1,747  
Professional fees 932     748     769     739     1,049     1,680     1,760  
Pennsylvania bank shares tax 473     473     16     317     297     946     961  
Information technology 1,252     1,195     1,006     880     821     2,447     1,695  
Other operating expenses 4,986     3,367     3,989     4,068     3,857     8,353     7,236  
Total noninterest expense 35,836     36,030     31,056     28,184     28,495     71,866     55,155  
Income before income taxes 18,418     19,915     13,724     15,505     14,338     38,333     28,017  
Income tax expense 3,723     4,630     19,924     4,766     4,905     8,353     9,540  
Net income $ 14,695     $ 15,285     $ (6,200 )   $ 10,739     $ 9,433     $ 29,980     $ 18,477  
Net income (loss) attributable to noncontrolling interest 7     (1 )               6      
Net income attributable to Bryn Mawr Bank Corporation $ 14,688     $ 15,286     $ (6,200 )   $ 10,739     $ 9,433     $ 29,974     $ 18,477  
                           
Per share data:                          
Weighted average shares outstanding 20,238,852     20,202,969     17,632,697     17,023,046     16,984,563     20,221,010     16,969,431  
Dilutive common shares 208,508     247,525     211,975     230,936     248,204     221,707     238,381  
Weighted average diluted shares 20,447,360     20,450,494     17,844,672     17,253,982     17,232,767     20,442,717     17,207,812  
Basic earnings (loss) per common share $ 0.73     $ 0.76     $ (0.35 )   $ 0.63     $ 0.56     $ 1.48     $ 1.09  
Diluted earnings (loss) per common share $ 0.72     $ 0.75     $ (0.35 )   $ 0.62     $ 0.55     $ 1.47     $ 1.07  
Dividends paid or accrued per share $ 0.22     $ 0.22     $ 0.22     $ 0.22     $ 0.21     $ 0.44     $ 0.42  
Effective tax rate 20.21 %   23.25 %   145.18 %   30.74 %   34.21 %   21.79 %   34.05 %


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, 2018
March 31, 2018
December 31, 2017
September 30, 2017
June 30, 2017
  June 30, 2018
June 30, 2017
 
(dollars in thousands) Average
  Interest
  Average
Average
  Interest
  Average
Average
  Interest
  Average
Average
  Interest
  Average
Average
  Interest
  Average 
  Average
  Interest
  Average
Average
  Interest
  Average
 
Balance
  Income/
  Rates Earned/
Balance
  Income/
  Rates Earned/
Balance
  Income/
  Rates Earned/
Balance
  Income/ 
  Rates Earned/
Balance
  Income/
  Rates Earned/
Balance
  Income/
  Rates Earned/
Balance
  Income/
  Rates Earned/
 
        Expense
  Paid
        Expense
  Paid
        Expense
  Paid
        Expense
  Paid
        Expense
  Paid
        Expense
  Paid
        Expense
  Paid
 
                                                   
Assets:                                                  
Interest-bearing deposits with other banks $ 37,215     $ 64   0.69 % $ 38,044     $ 53   0.56 % $ 43,962     $ 37   0.33 % $ 26,628     $ 36   0.54 % $ 26,266     $ 35   0.53 %   $ 37,627     $ 117   0.63 % $ 32,931     $ 101   0.62 %  
Investment securities - available for sale:                                                  
Taxable   514,966       2,888   2.25 %   498,718       2,675   2.18 %   465,393       2,394   2.04 %   427,106       2,160   2.01 %   391,112       1,940   1.99 %     506,887       5,625   2.24 %   372,772       3,620   1.96 %  
Tax-exempt   18,215       93   2.05 %   20,501       100   1.98 %   22,640       127   2.23 %   25,268       134   2.10 %   28,970       150   2.08 %     19,352       193   2.01 %   30,221       314   2.10 %  
Total investment securities - available for sale   533,181       2,981   2.24 %   519,219       2,775   2.17 %   488,033       2,521   2.05 %   452,374       2,294   2.01 %   420,082       2,090   2.00 %     526,239       5,818   2.23 %   402,993       3,934   1.97 %  
                                                   
Investment securities - held to maturity   7,866       13   0.66 %   7,913       12   0.62 %   7,510       11   0.58 %   6,044       11   0.72 %   5,181       5   0.39 %     7,889       4   0.10 %   4,446       4   0.18 %  
Investment securities - trading   8,202       22   1.08 %   8,339       21   1.02 %   4,425       25   2.24 %   4,282       8   0.74 %   4,137       13   1.26 %     8,270       2   0.05 %   4,014       2   0.10 %  
                                                   
Loans and leases *   3,353,339       41,782   5.00 %   3,291,212       40,754   5.02 %   2,805,255       32,403   4.58 %   2,680,317       31,058   4.60 %   2,615,610       29,309   4.49 %     3,322,447       82,536   5.01 %   2,585,809       57,931   4.52 %  
                                                   
Total interest-earning assets   3,939,803       44,862   4.57 %   3,864,727       43,615   4.58 %   3,349,185       34,997   4.15 %   3,169,645       33,407   4.18 %   3,071,276       31,452   4.11 %     3,902,472       88,477   4.57 %   3,030,193       61,972   4.12 %  
                                                   
Cash and due from banks   7,153               10,698           6,855           15,709           15,727             8,916           15,336          
Less: allowance for loan and lease losses   (18,043 )             (17,628 )         (17,046 )         (16,564 )         (17,549 )           (17,837 )         (17,564 )        
Other assets   415,628               388,383           301,673           273,116           263,853             402,086           260,963          
                                                   
Total assets $ 4,344,541             $ 4,246,180         $ 3,640,667         $ 3,441,906         $ 3,333,307           $ 4,295,637         $ 3,288,928          
                                                   
Liabilities:                                                  
                                                   
Interest-bearing deposits:                                                  
Savings, NOW and market rate deposits $ 1,722,328     $ 2,073   0.48 % $ 1,676,733     $ 1,479   0.36 % $ 1,410,461     $ 897   0.25 % $ 1,359,293     $ 823   0.24 % $ 1,375,949     $ 813   0.24 %   $ 1,701,732     $ 3,552   0.42 % $ 1,382,220     $ 1,569   0.23 %  
Wholesale deposits   233,714       973   1.67 %   231,289       733   1.29 %   262,643       822   1.24 %   190,849       548   1.14 %   154,424       378   0.98 %     232,508       1,706   1.48 %   148,973       695   0.94 %  
Retail time deposits   533,254       1,453   1.09 %   527,469       1,260   0.97 %   358,066       1,020   1.13 %   321,352       827   1.02 %   323,287       792   0.98 %     530,378       2,713   1.03 %   321,738       1,547   0.97 %  
Total interest-bearing deposits   2,489,296       4,499   0.72 %   2,435,491       3,472   0.58 %   2,031,170       2,739   0.53 %   1,871,494       2,198   0.47 %   1,853,660       1,983   0.43 %     2,464,618       7,971   0.65 %   1,852,931       3,811   0.41 %  
                                                   
Borrowings:                                                  
Short-term borrowings   205,323       985   1.92 %   172,534       630   1.48 %   180,650       579   1.27 %   182,845       547   1.19 %   98,869       237   0.96 %     189,019       1,615   1.72 %   73,378       264   0.73 %  
Long-term FHLB advances   102,023       490   1.93 %   123,920       562   1.84 %   134,605       595   1.75 %   155,918       645   1.64 %   171,567       682   1.59 %     112,911       1,052   1.88 %   177,006       1,380   1.57 %  
Jr. subordinated debt   21,470       321   6.00 %   21,430       288   5.45 %   3,957       46   4.61 %                             21,450       609   5.73 %           %  
Subordinated notes   98,463       1,143   4.66 %   98,430       1,143   4.71 %   43,844       518   4.69 %   29,564       370   4.97 %   29,550       370   5.02 %     98,447       2,286   4.68 %   29,544       740   5.05 %  
Total borrowings   427,279       2,939   2.76 %   416,314       2,623   2.56 %   363,056       1,738   1.90 %   368,327       1,562   1.68 %   299,986       1,289   1.72 %     421,827       5,562   2.66 %   279,928       2,384   1.72 %  
                                                   
Total interest-bearing liabilities   2,916,575       7,438   1.02 %   2,851,805       6,095   0.87 %   2,394,226       4,477   0.74 %   2,239,821       3,760   0.67 %   2,153,646       3,272   0.61 %     2,886,445       13,533   0.95 %   2,132,859       6,195   0.59 %  
                                                   
Noninterest-bearing deposits   841,676               835,476           771,519           764,562           755,597             840,571           733,817          
Other liabilities   52,389               32,465           47,604           40,166           34,348             42,482           36,266          
Total noninterest-bearing liabilities   894,065               867,941           819,123           804,728           789,945             883,053           770,083          
                                                   
Total liabilities   3,810,640               3,719,746           3,213,349           3,044,549           2,943,591             3,769,498           2,902,942          
                                                   
Shareholders' equity   533,901               526,434           427,318           397,357           389,716             526,139           385,986          
                                                   
Total liabilities and shareholders' equity $ 4,344,541             $ 4,246,180         $ 3,640,667         $ 3,441,906         $ 3,333,307           $ 4,295,637         $ 3,288,928          
                                                   
Net interest spread         3.55 %     3.71 %     3.41 %     3.51 %     3.50 %       3.62 %     3.53 %  
Effect of noninterest-bearing sources         0.26 %     0.23 %     0.21 %     0.20 %     0.18 %       0.25 %     0.18 %  
                                                   
Tax-equivalent net interest margin   $ 37,424   3.81 %   $ 37,520   3.94 %   $ 30,520   3.62 %   $ 29,647   3.71 %   $ 28,180   3.68 %     $ 74,944   3.87 %   $ 55,777   3.71 %  
                                                   
Tax-equivalent adjustment   $ 108   0.01 %   $ 81   0.01 %   $ 199   0.02 %   $ 209   0.03 %   $ 215   0.03 %     $ 189   0.01 %   $ 409   0.03 %  
                                                   
                                                                                                                                   


Bryn Mawr Bank Corporation
Tax-Equivalent Net Interest Margin (unaudited)
(dollars in thousands, except per share data)
 
Supplemental Information Regarding Accretion of Fair Value Marks
  For The Three Months Ended   For The Six Months Ended
  June 30, 2018 March 31, 2018 December 31, 2017 September 30, 2017 June 30, 2017   June 30, 2018 June 30, 2017
(dollars in thousands) Interest Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
    Inc. /
(Dec.)
Effect on
Yield or
Rate
  Inc. /
(Dec.)
Effect on
Yield or
Rate
Loans and leases Income $ 1,945   0.23 %   $ 2,702   0.33 %   $ 276   0.04 %   $ 708   0.10 %   $ 402   0.06 %     $ 4,647   0.28 %   $ 1,128   0.09 %
Retail time deposits Expense (339 ) (0.25 )%   (380 ) (0.29 )%   (13 ) (0.01 )%   (15 ) (0.02 )%   (18 ) (0.02 )%     (719 ) (0.27 )%   (37 ) (0.02 )%
Long-term FHLB advances and other borrowings Expense 25   0.10 %   15   0.05 %   (31 ) (0.09 )%   (30 ) (0.08 )%   (30 ) (0.07 )%     40   0.07 %   (60 ) (0.07 )%
Jr. subordinated debt Expense 41   0.77 %   40   0.76 %     %     %     %     81   0.76 %     %
Net interest income from fair value marks   $ 2,218       $ 3,027       $ 320       $ 753       $ 450         $ 5,245       $ 1,225    
Purchase accounting effect on tax-equivalent margin     0.23 %     0.32 %     0.04 %     0.09 %     0.06 %       0.27 %     0.08 %


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   For the Six Months Ended
  June 30,
2018
  March 31,
2018
  December 31,
2017
  September 30,
2017
  June 30,
2017
  June 30,
2018
  June 30,
2017
Reconciliation of Net Income to Net Income (core):                          
Net income (loss) attributable to BMBC (a GAAP measure) $ 14,688     $ 15,286     $ (6,200 )   $ 10,739     $ 9,433     $ 29,974     $ 18,477  
Less: Tax-effected non-core noninterest income:                          
(Gain) loss on sale of investment securities available for sale     (6 )   (18 )   (47 )       (6 )   (1 )
Add: Tax-effected non-core noninterest expense items:                          
Due diligence, merger-related and merger integration expenses 2,412     3,412     2,280     553     803     5,824     1,136  
Add: Federal income tax expense related to re-measurement of net deferred tax asset due to tax reform legislation (69 )   590     15,193             521      
Net income (core) (a non-GAAP measure) $ 17,031     $ 19,282     $ 11,255     $ 11,245     $ 10,236     $ 36,313     $ 19,612  
                           
Calculation of Basic and Diluted Earnings per Common Share (core):                          
Weighted average common shares outstanding 20,238,852     20,202,969     17,632,697     17,023,046     16,984,563     20,221,010     16,969,431  
Dilutive common shares 208,508     247,525     211,975     230,936     248,204     221,707     238,381  
Weighted average diluted shares 20,447,360     20,450,494     17,844,672     17,253,982     17,232,767     20,442,717     17,207,812  
Basic earnings per common share (core) (a non-GAAP measure) $ 0.84     $ 0.95     $ 0.64     $ 0.66     $ 0.60     $ 1.80     $ 1.16  
Diluted earnings per common share (core) (a non-GAAP measure) $ 0.83     $ 0.94     $ 0.63     $ 0.65     $ 0.59     $ 1.78     $ 1.14  
                           
Calculation of Return on Average Tangible Equity:                          
Net income (loss) attributable to BMBC (a GAAP measure) $ 14,688     $ 15,286     $ (6,200 )   $ 10,739     $ 9,433     $ 29,974     $ 18,477  
Add: Tax-effected amortization and impairment of intangible assets 702     694     440     440     447     1,397     897  
Net tangible income (numerator) $ 15,390     $ 15,980     $ (5,760 )   $ 11,179     $ 9,880     $ 31,371     $ 19,374  
                           
Average shareholders' equity $ 533,901     $ 526,434     $ 427,318     $ 397,357     $ 389,716     $ 526,139     $ 385,986  
Less: Average Noncontrolling interest 685     683     126             684      
Less: Average goodwill and intangible assets (208,039 )   (205,529 )   (142,652 )   (128,917 )   (126,537 )   (206,790 )   (125,715 )
Net average tangible equity (denominator) $ 326,547     $ 321,588     $ 284,792     $ 268,440     $ 263,179     $ 320,033     $ 260,271  
                           
Return on tangible equity (a non-GAAP measure) 18.90 %   20.15 %   (8.02 )%   16.52 %   15.06 %   19.77 %   15.01 %
                           
Calculation of Return on Average Tangible Equity (core):                          
Net income (core) (a non-GAAP measure) $ 17,031     $ 19,282     $ 11,255     $ 11,245     $ 10,236     $ 36,313     $ 19,612  
Add: Tax-effected amortization and impairment of intangible assets 702     694     440     440     447     1,397     897  
Net tangible income (core) (numerator) $ 17,733     $ 19,976     $ 11,695     $ 11,685     $ 10,683     $ 37,710     $ 20,509  
                           
Average shareholders' equity $ 533,901     $ 526,434     $ 427,318     $ 397,357     $ 389,716     $ 526,139     $ 385,986  
Less: Average Noncontrolling interest 685     683     126             684      
Less: Average goodwill and intangible assets (208,039 )   (205,529 )   (142,652 )   (128,917 )   (126,537 )   (206,790 )   (125,715 )
Net average tangible equity (denominator) $ 326,547     $ 321,588     $ 284,792     $ 268,440     $ 263,179     $ 320,033     $ 260,271  
                           
Return on tangible equity (core) (a non-GAAP measure) 21.78 %   25.19 %   16.29 %   17.27 %   16.28 %   23.76 %   15.89 %


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   For the Six Months Ended
  June 30,
2018
  March 31,
2018
  December 31,
2017
  September 30,
2017
  June 30,
2017
  June 30,
2018
  June 30,
2017
Calculation of Tangible Equity Ratio (BMBC):                          
Total shareholders' equity $ 542,503     $ 533,061     $ 528,119     $ 401,892     $ 394,977          
Less: Noncontrolling interest 678     684     683                  
Less: Goodwill and intangible assets (208,139 )   (207,287 )   (205,855 )   (128,534 )   (129,211 )        
Net tangible equity (numerator) $ 335,042     $ 326,458     $ 322,947     $ 273,358     $ 265,766          
                           
Total assets $ 4,394,203     $ 4,300,376     $ 4,449,720     $ 3,476,821     $ 3,438,219          
Less: Goodwill and intangible assets (208,139 )   (207,287 )   (205,855 )   (128,534 )   (129,211 )        
Tangible assets (denominator) $ 4,186,064     $ 4,093,089     $ 4,243,865     $ 3,348,287     $ 3,309,008          
                           
Tangible equity ratio (BMBC)(1) 8.00 %   7.98 %   7.61 %   8.16 %   8.03 %        
                           
Calculation of Tangible Equity Ratio (BMTC):                          
Total shareholders' equity $ 582,354     $ 569,670     $ 559,581     $ 398,431     $ 388,529          
Less: Noncontrolling interest 678     684     683                  
Less: Goodwill and intangible assets (195,245 )   (194,316 )   (192,807 )   (115,410 )   (116,009 )        
Net tangible equity (numerator) $ 387,787     $ 376,038     $ 367,457     $ 283,021     $ 272,520          
                           
Total assets $ 4,378,508     $ 4,284,334     $ 4,430,528     $ 3,459,996     $ 3,421,587          
Less: Goodwill and intangible assets (195,245 )   (194,316 )   (192,807 )   (115,410 )   (116,009 )        
Tangible assets (denominator) $ 4,183,263     $ 4,090,018     $ 4,237,721     $ 3,344,586     $ 3,305,578          
                           
Tangible equity ratio (BMTC)(1) 9.27 %   9.19 %   8.67 %   8.46 %   8.24 %        
                           
Calculation of Return on Average Assets (core)                          
Return on average assets (GAAP) 1.36 %   1.46 %   (0.68 )%   1.24 %   1.14 %   1.41 %   1.13 %
Effect of adjustment to GAAP net income to core net income 0.22 %   0.38 %   1.90 %   0.06 %   0.10 %   0.30 %   0.07 %
Return on average assets (core) 1.57 %   1.84 %   1.23 %   1.30 %   1.23 %   1.70 %   1.20 %
                           
Calculation of Return on Average Equity (core)                          
Return on average equity (GAAP) 11.03 %   11.78 %   (5.76 )%   10.72 %   9.71 %   11.49 %   9.65 %
Effect of adjustment to GAAP net income to core net income 1.76 %   3.08 %   16.21 %   0.51 %   0.83 %   2.43 %   0.59 %
Return on average equity (core) 12.79 %   14.85 %   10.45 %   11.23 %   10.53 %   13.92 %   10.25 %

(1)  Capital Ratios for the current quarter are to be considered preliminary until the Call Reports are filed.


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   For the Six Months Ended
  June 30,
2018
  March 31,
2018
  December 31,
2017
  September 30,
2017
  June 30,
2017
  June 30,
2018
  June 30,
2017
Calculation of Efficiency Ratio:                          
Noninterest expense $ 35,836     $ 36,030     $ 31,056     $ 28,184     $ 28,495     $ 71,866     $ 55,155  
Less: certain noninterest expense items*:                          
Amortization of intangibles (889 )   (879 )   (677 )   (677 )   (687 )   (1,768 )   (1,380 )
Due diligence, merger-related and merger integration expenses (3,053 )   (4,319 )   (3,507 )   (850 )   (1,236 )   (7,372 )   (1,747 )
Noninterest expense (adjusted) (numerator) $ 31,894     $ 30,832     $ 26,872     $ 26,657     $ 26,572     $ 62,726     $ 52,028  
                           
Noninterest income $ 20,075     $ 19,536     $ 15,536     $ 15,584     $ 14,785     $ 39,611     $ 28,012  
Less: non-core noninterest income items:                          
Loss (gain) on sale of investment securities available for sale     (7 )   (28 )   (72 )       (7 )   (1 )
Noninterest income (core) $ 20,075     $ 19,529     $ 15,508     $ 15,512     $ 14,785     $ 39,604     $ 28,011  
Net interest income 37,316     37,439     30,321     29,438     27,965     74,755     55,368  
Noninterest income (core) and net interest income (denominator) $ 57,391     $ 56,968     $ 45,829     $ 44,950     $ 42,750     $ 114,359     $ 83,379  
                           
Efficiency ratio 55.57 %   54.12 %   58.64 %   59.30 %   62.16 %   54.85 %   62.40 %
                           
Supplemental Loan and Allowance Information Used to Calculate Non-GAAP Measures                          
Total Allowance $ 19,398     $ 17,662     $ 17,525     $ 17,004     $ 16,399          
Less: Allowance on acquired loans 217     92     50     47     25          
Allowance on originated loans and leases $ 19,181     $ 17,570     $ 17,475     $ 16,957     $ 16,374          
                           
Total Allowance $ 19,398     $ 17,662     $ 17,525     $ 17,004     $ 16,399          
Loan mark on acquired loans 26,705     32,260     34,790     10,223     11,084          
Total Allowance + Loan mark $ 46,103     $ 49,922     $ 52,315     $ 27,227     $ 27,483          
                           
Total Portfolio loans and leases $ 3,389,501     $ 3,305,795     $ 3,285,858     $ 2,677,345     $ 2,666,651          
Less: Originated loans and leases 2,700,815     2,564,827     2,487,296     2,433,054     2,409,964          
Net acquired loans $ 688,686     $ 740,968     $ 798,562     $ 244,291     $ 256,687          
Add: Loan mark on acquired loans 26,705     32,260     34,790     10,223     11,084          
Gross acquired loans (excludes loan mark) $ 715,391     $ 773,228     $ 833,352     $ 254,514     $ 267,771          
Originated loans and leases 2,700,815     2,564,827     2,487,296     2,433,054     2,409,964          
Total Gross portfolio loans and leases $ 3,416,206     $ 3,338,055     $ 3,320,648     $ 2,687,568     $ 2,677,735          

*  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.


FOR MORE INFORMATION CONTACT:
Frank Leto, President, CEO
610-581-4730
Mike Harrington, CFO
610-526-2466

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