News Column

Bank of Marin Bancorp Reports Record Quarterly Earnings of $5.2 Million

July 21, 2014

NOVATO, Calif.--(BUSINESS WIRE)-- Bank of Marin Bancorp, “Bancorp” (NASDAQ:BMRC), parent company of Bank of Marin, announced record earnings of $5.2 million in the second quarter of 2014, compared to $4.5 million in the first quarter of 2014 and $3.1 million in the second quarter of 2013. Diluted earnings per share totaled $0.86 in the second quarter, compared to $0.76 in the prior quarter and $0.55 in the same quarter a year ago. June 30, 2014 year-to-date earnings totaled $9.7 million compared to $7.9 million for the same period a year ago. Diluted earnings per share for the six-month period totaled $1.62 as compared to $1.44 for the same period in 2013.

“We are pleased to report record earnings this quarter, driven by new loan and core deposit growth across the franchise,” said Russell A. Colombo, President and Chief Executive Officer. “The Bank is built on a foundation of strong credit quality and a commitment to our long-term strategy as a relationship-driven, community bank.”

Bancorp also provided the following highlights on its operating and financial performance for the second quarter of 2014:

  • Loans grew to $1.3 billion, an increase of $60.5 million, or 4.7%, over March 31, 2014, and $247.0 million, or 22.6% over June 30, 2013. The increase in loans from a year ago reflects both acquired loans and organic growth. Credit quality improved with non-accrual loans representing 0.76% of total loans at June 30, 2014, down from 0.79% at March 31, 2014 and 1.69% a year ago. Net recoveries for the second quarter totaled $68 thousand, compared to net charge-offs of $142 thousand in the prior quarter and net charge-offs of $177 thousand in the same quarter a year ago.
  • Non-interest expense totaled $11.5 million in the second quarter of 2014, a decrease of $1.4 million, or 10.8%, compared to the prior quarter. The second quarter of 2104 reflects normalization of non-interest expense with significant drops in salaries and related benefits, data processing costs and professional services as the expenses of the merger with NorCal Community Bancorp (NorCal”), parent company of Bank of Alameda, were fully absorbed in the fourth quarter of 2013 and the first quarter of 2014.
  • Developments during the quarter included the relocation of our Sausalito branch, the third in the Bank’s strategy to reduce square footage as customers increasingly utilize online banking channels. Regarding key products, the Bank reinstated its floating home loan program as of July 1 and has been successful with Tenant in Common loans in the San Francisco market. After an extensive review, the Bank is discontinuing the small mortgage brokerage acquired from NorCal as the broker model is not consistent with Bank of Marin's underwriting philosophy. The financial impact is not material.
  • The total risk-based capital ratio for Bancorp was 13.5% at both June 30, 2014 and March 31, 2014, compared to 14.0% at June 30, 2013. The ratio declined as compared to the same quarter a year ago due to $10.6 million in goodwill and intangibles related to the NorCal acquisition, which are excluded from regulatory capital. The risk-based capital ratio continues to be well above regulatory requirements for a well-capitalized institution as well as new requirements that will take effect in 2015 (Basel Committee on Bank Supervision guidelines for determining regulatory capital). Tangible common equity to tangible assets totaled 9.9% at June 30, 2014, compared to 9.8% at the end of the prior quarter.
  • Quarterly return on assets (“ROA”) of 1.14% at June 30, 2014, increased from 1.01% at March 31, 2014 and 0.86% a year ago. Quarterly return on equity (“ROE”) totaled 10.96% at June 30, 2014, compared to 9.97% at March 31, 2014 and 7.72% at June 30, 2013. The increase in ROA and ROE in the current quarter was driven by record earnings.
  • On July 18, 2014, the Board of Directors declared a quarterly cash dividend of $0.20 per share, a $0.01 increase from prior quarter. The cash dividend is payable to shareholders of record at the close of business on August 1, 2014 and will be payable on August 8, 2014.

    Loans and Credit Quality

    Gross loans increased $60.5 million from the prior quarter, which was driven by an increase in commercial real estate and commercial and industrial loans. Loans increased $247.0 million from a year ago which reflects both loans acquired from NorCal and organic growth. Non-accrual loans decreased from $18.5 million a year ago to $10.1 million at June 30, 2014 and March 31, 2014. The decrease in non-accrual loans from June 30, 2013 primarily relates to $6.5 million in pay-offs and pay-downs associated with two borrowers. Accruing loans past due 30 to 89 days totaled $1.5 million at June 30, 2014, compared to $2.8 million at March 31, 2014 and $566 thousand a year ago.

    The provision for loan losses of $600 thousand in the second quarter of 2014 relates to loan growth and compares to $150 thousand in the prior quarter and $1.1 million in the same quarter a year ago. The ratio of loan loss reserve to loans remained unchanged from March 31, 2014 at 1.11%. The decline compared to 1.32% at June 30, 2013 is primarily due to the loans acquired from Bank of Alameda marked down to fair value without allowances established.

    Deposits

    Deposits totaled $1.6 billion at both June 30, 2014 and March 31, 2014, an increase of $374 million compared to $1.2 billion at June 30, 2013. The increase in deposits from a year ago reflects the Bank's move into the East Bay market as well as organic growth in the Marin and Sonoma markets, with higher balances seen in all deposit categories except CDARS time deposits. Non-interest bearing deposits totaled $724 million at June 30, 2014, an increase of $23.4 million when compared to March 31, 2014, and represented 45.3% of total deposits as of June 30, 2014, up from 44.5% at the prior quarter-end and 40.7% at June 30, 2013.

    Earnings

    “Discipline around balance sheet and expense management contributed to the strong results for the quarter as did the absence of nonrecurring acquisition expenses,” said Tani Girton, Chief Financial Officer. “The Bank’s stable net interest margin, improved efficiency ratio, and solid return on assets reflect our continued focus on those areas.”

    Net interest income totaled $17.9 million in both the second quarter of 2014 and the prior quarter, compared to $14.3 million in the same quarter a year ago. The increase from the same quarter a year ago relates to higher balances on loans and investments, as well as accretion and gains on pay-offs of acquired loans. The tax-equivalent net interest margin was 4.23%, 4.25% and 4.30% for those respective periods. The decrease in the second quarter of 2014 compared to the same quarter a year ago primarily relates to the impact of the low interest rate environment on the loan portfolio and higher cash balances as a percentage of interest-earning assets, partially offset by the accretion and gains on pay-offs of acquired loans.

    Summary of Charter Oak and NorCal acquisitions' impact on net interest margin:

       
    Three months ended
    June 30, 2014     March 31, 2014     June 30, 2013
        Basis point     Basis point     Basis point
    Dollar impact to net Dollar impact to net Dollar impact to net
    (dollars in thousands; unaudited)     Amount     interest margin     Amount     interest margin     Amount     interest margin
    Accretion on PCI loans $ 187 4 bps $ 180 4 bps $ 156 5 bps
    Accretion on non-PCI loans $ 713 17 bps $ 1,330 31 bps $ 246 7 bps
    Gains on pay-offs of PCI loans $ 622 14 bps $ 0 bps $ 149

    4 bps

     
       
    Six months ended
    June 30, 2014     June 30, 2013
        Basis point         Basis point
    Dollar impact to net Dollar impact to net
    (dollars in thousands; unaudited)     Amount     interest margin     Amount     interest margin
    Accretion on PCI loans $ 367 4 bps $ 392 6 bps
    Accretion on non-PCI loans $ 2,043 24 bps $ 378 6 bps
    Gains on pay-offs of PCI loans $ 622 7 bps $ 469 7 bps
     


    For acquired loans not considered credit-impaired, the level of accretion varies due to maturities and early pay-offs of these loans. Accretion on PCI loans fluctuates based on changes in cash flows expected to be collected. Gains on pay-offs of PCI loans are recorded as interest income when the pay-off amounts exceed the recorded investment.

    Non-interest income in the second quarter of 2014 totaled $2.4 million, compared to $2.2 million in the prior quarter and $1.9 million in the same quarter a year ago. The increase from the same quarter a year ago primarily relates to gains on the sale of investment securities, higher dividend income from the Federal Home Loan Bank of San Francisco and higher debit card interchange fees.

    Non-interest expense totaled $11.5 million in the second quarter of 2014, compared to $12.8 million in the prior quarter and $10.4 million in the same quarter a year ago. Second quarter 2014 non-interest expense decreased $1.4 million, or 10.8%, compared to the prior quarter, primarily related to the absence of acquisition-related expenses and miscellaneous cost savings in the second quarter. The increase in non-interest expense from the same quarter a year ago reflects the higher cost base associated with a larger-sized Bank, expansion into the East Bay, and increased lending staff in the North Bay.

    Earnings Call and Webcast Information

    Bank of Marin Bancorp will webcast its second quarter earnings call on Monday, July 21, 2014 at 8:30 a.m. PT/ 11:30 a.m. ET. Investors will have the opportunity to listen to the conference call online through Bank of Marin’s web site at http://www.bankofmarin.com under “Latest Press and News.” To listen to the live call, please go to the website at least 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available at the same website location shortly after the call.

    About Bank of Marin Bancorp

    Bank of Marin is a leading business and community bank in the San Francisco Bay Area, with assets of $1.8 billion. Founded in 1989 and headquartered in Novato, Bank of Marin is the sole subsidiary of Bank of Marin Bancorp (NASDAQ: BMRC). With 21 offices in San Francisco, Marin, Napa, Sonoma and Alameda counties, Bank of Marin provides business and personal banking, commercial lending, and wealth management services. Specializing in providing legendary service to its customers and investing in its local communities, Bank of Marin has consistently been ranked one of the “Top Corporate Philanthropists" by the San Francisco Business Times and one of the “Best Places to Work” by the North Bay Business Journal. Bank of Marin Bancorp is included in the Russell 2000 Small-Cap Index and has been recognized as a Top 200 Community Bank by US Banker Magazine for the past five years. For more information, visit www.bankofmarin.com.

    Forward Looking Statements

    This release may contain certain forward-looking statements that are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact Bancorp's earnings in future periods. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “intend,” “estimate” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Factors that could cause future results to vary materially from current management expectations include, but are not limited to, our ability to integrate the business of NorCal, general economic conditions, economic uncertainty in the United States and abroad, changes in interest rates, deposit flows, real estate values, expected future cash flows on acquired loans, competition, changes in accounting principles, policies or guidelines, legislation or regulation, and other economic, competitive, governmental, regulatory and technological factors affecting Bancorp's operations, pricing, products and services. These and other important factors, including the impact of the NorCal acquisition, are detailed in various securities law filings made periodically by Bancorp, copies of which are available from Bancorp without charge. Bancorp undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.

     
    BANK OF MARIN BANCORP
    FINANCIAL HIGHLIGHTS
    June 30, 2014
    (dollars in thousands, except per share data; unaudited)
           

    QUARTER-TO-DATE

    June 30, 2014

    March 31, 2014

    June 30, 2013

    NET INCOME $ 5,168 $ 4,533 $ 3,055
    DILUTED EARNINGS PER COMMON SHARE $ 0.86 $ 0.76 $ 0.55
    RETURN ON AVERAGE ASSETS (ROA) 1.14 % 1.01 % 0.86 %
    RETURN ON AVERAGE EQUITY (ROE) 10.96 % 9.97 % 7.72 %
    EFFICIENCY RATIO 56.60 % 63.86 % 64.12 %
    TAX-EQUIVALENT NET INTEREST MARGIN1 4.23 % 4.25 % 4.30 %
    NET CHARGE-OFFS/(RECOVERIES) $ (68 ) $ 142 $ 177
    NET CHARGE-OFFS/(RECOVERIES) TO AVERAGE LOANS (0.01 ) % 0.01 % 0.02 %
     

    YEAR-TO-DATE

    NET INCOME $ 9,701 $ 7,921
    DILUTED EARNINGS PER COMMON SHARE $ 1.62 $ 1.44
    RETURN ON AVERAGE ASSETS (ROA) 1.08 % 1.12 %
    RETURN ON AVERAGE EQUITY (ROE) 10.47 % 10.19 %
    EFFICIENCY RATIO 60.22 % 60.67 %
    TAX-EQUIVALENT NET INTEREST MARGIN1 4.24 % 4.39 %
    NET CHARGE-OFFS/(RECOVERIES) $ 75 $ 174
    NET CHARGE-OFFS/(RECOVERIES) TO AVERAGE LOANS 0.01 % 0.02 %
     

    AT PERIOD END

    TOTAL ASSETS $ 1,823,901 $ 1,797,852 $ 1,428,518
     
    LOANS:
    COMMERCIAL AND INDUSTRIAL $ 194,402 $ 177,995 $ 170,443
    REAL ESTATE
    COMMERCIAL OWNER-OCCUPIED $ 233,267 $ 232,117 $ 206,191
    COMMERCIAL INVESTOR-OWNED $ 669,225 $ 640,843 $ 535,260
    CONSTRUCTION $ 40,197 $ 32,512 $ 27,728
    HOME EQUITY $ 106,201 $ 99,723 $ 90,296
    OTHER RESIDENTIAL $ 80,399 $ 78,772 $ 43,290
    INSTALLMENT AND OTHER CONSUMER LOANS $ 14,820   $ 16,028   $ 18,274  
    TOTAL LOANS $ 1,338,511 $ 1,277,990 $ 1,091,482
     
    NON-PERFORMING LOANS2:
    COMMERCIAL AND INDUSTRIAL $ 335 $ 154 $ 2,022
    REAL ESTATE
    COMMERCIAL OWNER-OCCUPIED $ 1,403 $ 1,403 $ 1,403
    COMMERCIAL INVESTOR-OWNED $ 2,618 $ 2,694 $ 6,024
    CONSTRUCTION $ 5,197 $ 4,813 $ 7,046
    HOME EQUITY $ 444 $ 228 $ 524
    OTHER RESIDENTIAL $ $ 646 $ 1,148
    INSTALLMENT AND OTHER CONSUMER LOANS $ 152   $ 161   $ 321  
    TOTAL NON-ACCRUAL LOANS $ 10,149 $ 10,099 $ 18,488
     
    CLASSIFIED LOANS (GRADED SUBSTANDARD & DOUBTFUL) $ 33,246 $ 34,285 $ 27,602
    TOTAL ACCRUING LOANS 30-89 DAYS PAST DUE $ 1,471 $ 2,809 $ 566
    LOAN LOSS RESERVE TO LOANS 1.11 % 1.11 % 1.32 %
    LOAN LOSS RESERVE TO NON-ACCRUAL LOANS 1.47 x 1.41 x 0.78 x
    NON-ACCRUAL LOANS TO TOTAL LOANS 0.76 % 0.79 % 1.69 %
    TEXAS RATIO3 5.43 % 5.57 % 10.82 %
     
    TOTAL DEPOSITS $ 1,598,823 $ 1,576,340 $ 1,224,437
    LOAN TO DEPOSIT RATIO 83.7 % 81.1 % 89.1 %
    STOCKHOLDERS' EQUITY $ 190,906 $ 186,165 $ 158,359
    BOOK VALUE PER SHARE $ 32.29 $ 31.51 $ 29.10
    TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS4 9.9 % 9.8 % 11.1 %
    TOTAL RISK BASED CAPITAL RATIO-BANK5 13.0 % 13.0 % 13.7 %
    TOTAL RISK BASED CAPITAL RATIO-BANCORP5 13.5 % 13.5 % 14.0 %
    FULL TIME EQUIVALENT EMPLOYEES 263 277 243
     
    1 Net interest income is annualized by dividing actual number of days in the period times 360 days.
    2 Excludes accruing troubled-debt restructured loans of $14.3 million, $14.5 million and $10.0 million at June 30, 2014, March 31, 2014 and June 30, 2013, respectively. Excludes purchased credit-impaired (PCI) loans with carrying values of $3.8 million, $5.8 million and $2.1 million that were accreting interest at June 30, 2014, March 30, 2014 and June 30, 2013, respectively. These amounts are excluded as PCI loan accretable yield interest recognition is independent from the underlying contractual loan delinquency status. Total PCI loans were $5.2 million, $7.2 million and $3.5 million at June 30, 2014, March 31, 2014 and June 30, 2013.
    3 (Non-performing assets + 90 day delinquent loans)/(tangible common equity + allowance for loan losses).

    4 Tangible common equity to tangible assets is considered to be a meaningful non-GAAP financial measure of capital adequacy and is useful for investors to assess Bancorp's ability to absorb potential losses. Tangible common equity includes common stock, retained earnings and unrealized gain on available for sale securities, net of tax, less goodwill and intangible assets of $10.6 million and $10.7 million at June 30, 2014 and March 31, 2014, respectively. Tangible assets excludes goodwill and intangible assets.

    5 Current period estimated.
     
     

    BANK OF MARIN BANCORP

    CONSOLIDATED STATEMENTS OF CONDITION

    at June 30, 2014, March 31, 2013 and June 30, 2013

               
    (in thousands, except share data; unaudited)     June 30, 2014     March 31, 2014     June 30, 2013
    Assets
    Cash and due from banks $ 81,380 $ 91,567 $ 32,175
    Investment securities
    Held-to-maturity, at amortized cost 123,085 132,019 131,839
    Available-for-sale (at fair value; amortized cost $214,627, $230,067 and $127,989 at June 30, 2014, March 31, 2014 and June 30, 2013, respectively)       215,873       230,337       129,562
    Total investment securities 338,958 362,356 261,401
    Loans, net of allowance for loan losses of $14,900, $14,232 and $14,357 at June 30, 2014, March 31, 2014 and June 30, 2013, respectively 1,323,611 1,263,758 1,077,125
    Bank premises and equipment, net 9,296 9,036 9,178
    Goodwill 6,436 6,436
    Core deposit intangible 4,117 4,310
    Interest receivable and other assets       60,103       60,389       48,639
    Total assets     $1,823,901     $1,797,852     $1,428,518
     
    Liabilities and Stockholders' Equity
    Liabilities
    Deposits
    Non-interest bearing $ 724,975 $ 701,561 $ 498,572
    Interest bearing
    Transaction accounts 95,052 96,550 80,221
    Savings accounts 121,890 119,361 95,317
    Money market accounts 500,720 499,909 410,676
    CDARS® time accounts 4,296
    Other time accounts       156,186       158,959       135,355
    Total deposits 1,598,823 1,576,340 1,224,437
    Federal Home Loan Bank borrowings 15,000 15,000 32,200
    Subordinated debentures 5,077 5,023
    Interest payable and other liabilities       14,095       15,324       13,522
    Total liabilities       1,632,995       1,611,687       1,270,159
     
    Stockholders' Equity

    Preferred stock, no par value, Authorized - 5,000,000 shares, none issued

    Common stock, no par value, Authorized - 15,000,000 shares; Issued and outstanding - 5,912,774, 5,906,881 and 5,442,628 at June 30, 2014, March 31, 2014 and June 30, 2013, respectively

    81,219 81,049 60,312
    Retained earnings 108,922 104,877 97,135
    Accumulated other comprehensive income, net       765       239       912
    Total stockholders' equity       190,906       186,165       158,359
    Total liabilities and stockholders' equity     $1,823,901     $1,797,852     $1,428,518
     
     

    BANK OF MARIN BANCORP

    CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

           
    Three months ended Six months ended
    (in thousands, except per share amounts; unaudited)     June 30, 2014     March 31, 2014     June 30, 2013June 30, 2014     June 30, 2013
    Interest income            
    Interest and fees on loans $ 16,363 $ 16,319 $ 13,366 $ 32,682 $ 27,001
    Interest on investment securities
    Securities of U.S. Government agencies 1,193 1,232 585 2,425 1,210
    Obligations of state and political subdivisions 607 634 437 1,241 1,075
    Corporate debt securities and other 256 268 339 524 663
    Interest due from banks and other       37       51         3     88       11  
    Total interest income 18,456 18,504 14,730 36,960 29,960
    Interest expense
    Interest on interest bearing transaction accounts 26 23 12 49 23
    Interest on savings accounts 11 11 8 22 16
    Interest on money market accounts 131 158 95 289 194
    Interest on CDARS® time accounts 2 7
    Interest on other time accounts 231 235 224 466 456
    Interest on FHLB and overnight borrowings 78 78 84 156 163
    Interest on subordinated debentures       105       105             210        
    Total interest expense       582       610         425     1,192       859  
    Net interest income 17,874 17,894 14,305 35,768 29,101
    Provision for loan losses       600       150         1,100     750       870  
    Net interest income after provision for loan losses       17,274       17,744         13,205     35,018       28,231  
    Non-interest income
    Service charges on deposit accounts 528 556 515 1,084 1,036
    Wealth Management and Trust Services 613 564 539 1,177 1,086
    Debit card interchange fees 360 300 280 660 532
    Merchant interchange fees 207 198 222 405 427
    Earnings on Bank-owned life Insurance 211 213 186 424 587
    Gain (loss) on sale of securities 97 (8 ) 89
    Other income       352       393         202     745       382  
    Total non-interest income       2,368       2,216         1,944     4,584       4,050  
    Non-interest expense
    Salaries and related benefits 6,232 6,930 5,430 13,162 10,728
    Occupancy and equipment 1,329 1,334 1,052 2,663 2,125
    Depreciation and amortization 403 416 353 819 689
    Federal Deposit Insurance Corporation insurance 269 250 223 519 437
    Data processing 748 1,360 696 2,108 1,245
    Professional services 412 628 814 1,040 1,341
    Other expense       2,064       1,925         1,851     3,989       3,549  
    Total non-interest expense       11,457       12,843         10,419     24,300       20,114  
    Income before provision for income taxes 8,185 7,117 4,730 15,302 12,167
    Provision for income taxes       3,017       2,584         1,675     5,601       4,246  
    Net income     $5,168     $4,533       $3,055   $9,701     $7,921  
    Net income per common share:
    Basic $ 0.88 $ 0.77 $ 0.56 $ 1.65 $ 1.47
    Diluted $ 0.86 $ 0.76 $ 0.55 $ 1.62 $ 1.44
    Weighted average shares used to compute net income per common share:
    Basic 5,888 5,870 5,419 5,879 5,404
    Diluted 5,993 5,980 5,509 5,987 5,498
    Dividends declared per common share     $ 0.19     $ 0.19       $ 0.18   $ 0.38     $ 0.36  
    Comprehensive income:
    Net income $ 5,168 $ 4,533 $ 3,055 $ 9,701 $ 7,921
    Other comprehensive income (loss)

    Change in net unrealized gain (loss) on available-for-sale securities

    976 1,415 (1,666 ) 2,391 (1,969 )

    Reclassification adjustment for loss on sale of available-for-sale securities included in net income

                15             15        

    Net change in unrealized gain (loss) on available-for-sale securities, before tax

    976 1,430 (1,666 ) 2,406 (1,969 )
    Deferred tax expense (benefit)       450       519         (700 )   969       (826 )
    Other comprehensive income (loss), net of tax       526       911         (966 )   1,437       (1,143 )

    Comprehensive income

        $ 5,694     $ 5,444       $ 2,089   $ 11,138     $ 6,778  
     
     

    BANK OF MARIN BANCORP

    AVERAGE STATEMENTS OF CONDITION AND ANALYSIS OF NET INTEREST INCOME

                                       
    Three months ended Three months ended Three months ended
    June 30, 2014     March 31, 2014     June 30, 2013
    Interest Interest Interest
    Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/
    (Dollars in thousands; unaudited)     Balance     Expense     Rate     Balance     Expense     Rate     Balance     Expense     Rate
    Assets
    Interest-bearing due from banks 1 $ 54,313 $ 37 0.27 % $ 85,750 $ 51 0.24 % $ 4,485 $ 3 0.26 %
    Investment securities 2, 3 350,938 2,208 2.52 % 361,795 2,293 2.54 % 266,774 1,452 2.18 %
    Loans 1, 3, 4       1,303,363       16,597     5.04 %       1,268,841       16,511     5.20 %       1,070,333       13,537     5.00 %
    Total interest-earning assets 1 1,708,614 18,842 4.36 % 1,716,386 18,855 4.39 % 1,341,592 14,992 4.42 %
    Cash and non-interest-bearing due from banks 41,739 41,793 27,331
    Bank premises and equipment, net 9,228 9,088 9,313
    Interest receivable and other assets, net       56,954                   55,829                   38,981            
    Total assets     $1,816,535                 $1,823,096                 $1,417,217            
    Liabilities and Stockholders' Equity
    Interest-bearing transaction accounts $ 94,358 $ 26 0.11 % $ 127,098 $ 23 0.07 % $ 83,285 $ 12 0.06 %
    Savings accounts 120,071 11 0.04 % 121,278 11 0.04 % 95,083 8 0.03 %
    Money market accounts 504,597 131 0.10 % 518,930 158 0.12 % 410,823 95 0.09 %
    CDARS® time accounts % 36 % 5,194 2 0.15 %
    Other time accounts 157,239 231 0.59 % 160,942 235 0.59 % 136,759 224 0.66 %
    FHLB borrowings 1 15,000 78 2.07 % 15,000 78 2.07 % 27,785 84 1.20 %
    Subordinated debentures 1       5,043       105     8.24 %       4,988       105     8.58 %                 %
    Total interest-bearing liabilities 896,308 582 0.26 % 948,272 610 0.26 % 758,929 425 0.22 %
    Demand accounts 716,774 674,689 486,410
    Interest payable and other liabilities 14,281 15,748 13,092
    Stockholders' equity       189,172                   184,387                   158,786            
    Total liabilities & stockholders' equity     $1,816,535                 $1,823,096                 $1,417,217            
    Tax-equivalent net interest income/margin 1           $ 18,260     4.23 %           $ 18,244     4.25 %           $ 14,567     4.30 %
    Reported net interest income/margin 1           $ 17,874     4.14 %           $ 17,894     4.17 %           $ 14,305     4.21 %
    Tax-equivalent net interest rate spread                 4.10 %                 4.13 %                 4.20 %
     
    Six months ended Six months ended
    June 30, 2014     June 30, 2013
    Interest Interest
    Average Income/ Yield/ Average Income/ Yield/
    (Dollars in thousands; unaudited)     Balance     Expense     Rate     Balance     Expense     Rate
    Assets
    Interest-bearing due from banks 1 $ 69,945 $ 88 0.25 % $ 5,094 $ 11 0.43 %
    Investment securities 2, 3 356,336 4,501 2.53 % 275,553 3,236 2.35 %
    Loans 1, 3, 4       1,286,197       33,117     5.12 %       1,066,665       27,346     5.10 %
    Total interest-earning assets 1 1,712,478 37,706 4.38 % 1,347,312 30,593 4.52 %
    Cash and non-interest-bearing due from banks 41,766 27,788
    Bank premises and equipment, net 9,158 9,369
    Interest receivable and other assets, net       56,395                   38,440            
    Total assets     $1,819,797                 $1,422,909            
    Liabilities and Stockholders' Equity
    Interest-bearing transaction accounts $ 110,637 $ 49 0.09 % $ 106,205 $ 23 0.04 %
    Savings accounts 120,671 22 0.04 % 95,818 16 0.03 %
    Money market accounts 511,743 289 0.11 % 421,430 194 0.09 %
    CDARS® time accounts % 9,009 7 0.16 %
    Other time accounts 159,080 466 0.59 % 138,496 456 0.66 %
    FHLB borrowings 1 15,000 156 2.07 % 23,175 163 1.40 %
    Subordinated debentures 1       5,015       210     8.48 %                 %
    Total interest-bearing liabilities 922,146 1,192 0.26 % 794,133 859 0.22 %
    Demand accounts 695,848 458,030
    Interest payable and other liabilities 15,010 13,987
    Stockholders' equity       186,793                   156,759            
    Total liabilities & stockholders' equity     $1,819,797                 $1,422,909            
    Tax-equivalent net interest income/margin 1           $ 36,514     4.24 %           $ 29,734     4.39 %
    Reported net interest income/margin 1           $ 35,768     4.15 %           $ 29,101     4.30 %
    Tax-equivalent net interest rate spread                 4.12 %                 4.30 %
     

    1 Interest income/expense is divided by actual number of days in the period times 360 days to correspond to stated interest rate terms, where applicable.

    2 Yields on available-for-sale securities are calculated based on amortized cost balances rather than fair value, as changes in fair value are reflected as a component of stockholders' equity. Investment security interest is earned on 30/360 day basis monthly.

    3 Yields and interest income on tax-exempt securities and loans are presented on a taxable-equivalent basis using the Federal statutory rate of 35 percent.

    4 Average balances on loans outstanding include non-performing loans. The amortized portion of net loan origination fees is included in interest income on loans, representing an adjustment to the yield.

     





    for Bank of Marin Bancorp

    Sandy Pfaff, 415-819-7447

    sandy@pfaffpr.com


    Source: Bank of Marin Bancorp


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