Cambridge Bancorp Reports First Quarter Results

Cambridge Bancorp (OTC BB: CATC) today reported unaudited net income of $3,285,000 for the first quarter of 2012, or $0.85 per diluted share, compared to $3,105,000, or $0.82 per diluted share, for the same quarter in 2011. The quarter-over-quarter earnings increase of $180,000 (5.8%) was attributable to a combination of solid growth in net interest income and a modest increase in wealth management income.

“I am pleased to report an increase in the Bank’s quarter-over-quarter performance,” noted Joseph V. Roller II, president and CEO. “We remain focused on delivering value for our customers.”

“Net interest income provided a nice lift to first quarter earnings,” said Roller. Total net interest income of $11.5 million for the first quarter of 2012 was $974,000 (9.2%) higher than the same period in 2011. The Bank continued to grow Wealth Management income, which increased $83,000 (2.5%) between the comparable periods, from new account growth and market appreciation. Assets under management grew to $1.7 billion at the end of the first quarter 2012 from $1.5 billion at year-end 2011.

“The Bank sustained the trend of growth in both loans and deposits during the first quarter of 2012. This positive performance however should be viewed in the context of persistent pressure on our net interest margin,” added Roller.

Total loans outstanding increased by $18.1 million (2.7%) to $691.4 million since year-end 2011 and by $84.7 million (14.0%) over March 31, 2011. The loan growth in the first quarter of 2012 was primarily attributable to an increase in commercial mortgages of $12.5 million (5.4%) and to a lesser extent, residential mortgages of $5.2 million (1.6%).

Non-performing loans as a percentage of total loans stood at 0.17% at March 31, 2012, basically unchanged compared to 0.18% at December 31, 2011. Loan quality remains sound and the Allowance for Loan Losses stood at $10.5 million or 1.51% of total loans outstanding at March 31, 2012. At December 31, 2011, the Allowance for Loan Losses was $10.2 million or 1.51% of total loans outstanding. In response to continued loan growth, the provision for loan losses was $300,000 for the current quarter.

Total deposits increased by $31.2 million (2.8%) since year-end 2011 and by $147.2 million (14.6%) over March 31, 2011.

The Bank’s net interest margin was 3.72% for the three months ended March 31, 2012 compared to 3.89% for the first quarter of 2011. The net interest margin decrease of 17 basis points for the comparable periods reflects the continued low interest rate environment.

Noninterest expense in the first quarter of 2012 totaled $11.3 million, an increase of $849,000 (8.2%) over the first quarter of 2011. Salaries and employee benefits, and occupancy and equipment increases were partially offset by lower FDIC insurance costs for the comparable periods.

Cambridge Bancorp and its subsidiary, Cambridge Trust Company, are based in Cambridge, Massachusetts, in the heart of Harvard Square. Cambridge Trust Company is a 122-year-old Massachusetts chartered commercial bank with $1.3 billion in total assets and 11 Massachusetts locations in Cambridge, Beacon Hill, Belmont, Concord, Lexington, Lincoln, and Weston. Cambridge Trust Company is one of New England’s leaders in wealth management with $1.7 billion in client assets under management. In addition, Cambridge Trust Company of New Hampshire offers wealth management services at two New Hampshire locations, Concord and Portsmouth.

The accompanying unaudited condensed interim consolidated financial information should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Cambridge Bancorp 2011 Annual Report, which is posted in the investor relations section of our website at www.cambridgetrust.com/annualreport. We will also post supplemental financial information for first quarter of 2012 at the same site later this month. Interim results are not necessarily reflective of the results for the entire year.

Financial Highlights:
CAMBRIDGE BANCORP
QUARTERLY UNAUDITED RESULTS
March 31, 2012
Dollar amounts in thousands (except share data)
       
 
Quarter Ended
March 31,
  2012     2011  
 
Interest Income $ 12,404 $ 11,601
Interest Expense   867     1,038  
Net Interest Income 11,537 10,563
Provision for Loan Losses 300 250
Non-Interest Income 4,805 4,642
Non-Interest Expense   11,263     10,414  
Income Before Taxes 4,779 4,541
Income Taxes   1,494     1,436  
Net Income $ 3,285   $ 3,105  
 

Data Per Common Share:
 
Basic Earnings Per Share $ 0.86 $ 0.82
Diluted Earnings Per Share $ 0.85 $ 0.82
Dividends Declared Per Share $ 0.37 $ 0.35
 
Avg. Common Shares Outstanding:
Basic 3,817,422 3,764,423
Diluted 3,853,323 3,809,299

 

Selected Operating Ratios:
 
Net Interest Margin 3.72 % 3.89 %
Return on Average Assets, after taxes 1.02 % 1.09 %
Return on Average Equity, after taxes 13.57 % 13.90 %
 
 
March 31, December 31, March 31,
  2012     2011     2011  
 
Total Assets $ 1,345,473 $ 1,275,860 $ 1,147,144
Total Loans 691,398 673,265 606,680
Non-Performing Loans 1,165 1,204 884
Allowance for Loan Losses 10,474 10,159 9,379
Allowance to Non-Performing Loans 898.96 % 844.09 % 1060.94 %
Allowance to Total Loans 1.51 % 1.51 % 1.55 %
Total Deposits 1,156,822 1,125,654 1,009,626
Total Stockholders' Equity 97,915 96,633 90,234
 
Book Value Per Share $ 25.62 $ 25.39 $ 23.90
Tangible Book Value Per Share $ 25.51 $ 25.28 $ 23.75
CAMBRIDGE BANCORP
UNAUDITED CONSOLIDATED BALANCE SHEETS
   
March 31, December 31,
2012 2011
(In thousands)
ASSETS
 
Cash and due from banks $ 39,904 $ 22,512
Overnight investments    
Total cash and cash equivalents 39,904 22,512
Investment securities:
Available for sale, at fair value 500,290 470,232
Held-to-maturity, at amortized cost 73,343   74,256  
Total investment securities 573,633 544,488
 
Loans:
Residential mortgage 336,090 330,933
Commercial mortgage 244,085 231,595
Home equity 59,651 61,307
Commercial 38,580 38,260
Consumer 12,992   11,170  
Total loans 691,398 673,265
Allowance for loan losses (10,474 ) (10,159 )
Net loans 680,924 663,106
 
Stock in FHLB of Boston, at cost 4,956 4,806
Bank owned life insurance 22,512 17,331
Banking premises and equipment, net 5,975 6,216
Accrued interest receivable 4,076 4,423
Other assets 13,493   12,978  
Total assets $ 1,345,473   $ 1,275,860  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
Deposits:
Demand $ 285,997 $ 285,724
Interest bearing checking 303,013 316,454
Money market 59,612 58,532
Savings 366,669 328,771
Certificates of deposit 141,531   136,173  
Total deposits 1,156,822 1,125,654
 
Short-term borrowings 40,000 2,500
Long-term borrowings 30,000 30,000
Other liabilities 20,736   21,073  
Total liabilities 1,247,558   1,179,227  
Stockholders' equity:
Common stock, par value $1.00; Authorized
5,000,000 shares; Outstanding: 3,821,898 and
3,805,748 shares, respectively 3,822 3,806
Additional paid-in capital 23,198 23,001
Retained earnings 70,101 68,232
Accumulated other comprehensive income 794   1,594  
Total stockholders’ equity 97,915   96,633  
Total liabilities and stockholders’ equity $ 1,345,473   $ 1,275,860  
CAMBRIDGE BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
   
Quarter Ended March 31,
2012 2011
(In thousands, except per share data)
 
Interest income:
Interest on loans $ 8,328 $ 7,609
Interest on taxable investment securities 3,561 3,494
Interest on tax exempt investment securities 508 491
Dividends on FHLB of Boston stock 6 4
Interest on overnight investments 1 3
Total interest income 12,404 11,601
 
Interest expense:
Interest on deposits 552 743
Interest on borrowed funds 315 295
Total interest expense 867 1,038
 
Net interest income 11,537 10,563
 
Provision for loan losses 300 250
 
Net interest income after provision for loan losses 11,237 10,313
 
Noninterest income:
Wealth management income 3,343 3,260
Deposit account fees 592 538
ATM/Debit card income 239 228
Bank owned life insurance income 181 114
Gain on disposition of investment securities 257 268
Other income 193 234
Total noninterest income 4,805 4,642
 
Noninterest expense:
Salaries and employee benefits 6,704 5,902
Occupancy and equipment 1,944 1,827
Data processing 887 895
Professional services 460 444
Marketing 438 438
FDIC Insurance 172 312
Other expenses 658 596
Total noninterest expense 11,263 10,414
 
Income before income taxes 4,779 4,541
 
Income tax expense 1,494 1,436
   
Net income $ 3,285 $ 3,105
 
Per share data:
 
Basic earnings per common share $ 0.86 $ 0.82
Diluted earnings per common share $ 0.85 $ 0.82
 
Average shares outstanding - basic 3,817,405 3,764,423
Average shares outstanding - diluted 3,853,306 3,809,299
CAMBRIDGE BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
 
Quarter Ended March 31,
2012 2011
(In thousands)
 
 
Net income $ 3,285 $ 3,105
 
Other comprehensive income/(loss), net of tax:
Defined benefit retirement plans:
Change in unfunded retirement liability (95 ) (16 )
Unrealized gains/(losses) on Available for
Sale securities:
Unrealized holding gains/(losses) arising
during the period (539 ) (999 )
Less: reclassification adjustment for gains
recognized in net income (166 ) (174 )
   
Other comprehensive income/(loss) (800 ) (1,189 )
   
Comprehensive income/(loss) $ 2,485   $ 1,916  
CAMBRIDGE BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
 
Three Months Ended March 31,
2012 2011
(In thousands)
Cash flows provided by operating activities:
Net income $ 3,285 $ 3,105
Adjustments to arrive at net cash provided by operating activities:
Provision for loan losses 300 250
Amortization of deferred charges/(income), net 197 84
Depreciation and amortization 353 367
Bank owned life insurance income (181 ) (114 )
Gain on disposition of investment securities (257 ) (268 )
Compensation expense from stock option

and restricted stock grants
109 91
Change in accrued interest receivable, deferred
taxes, other assets and other liabilities (194 ) 1,473
Other, net 24   248  
Net cash provided by operating activities 3,636   5,236  
Cash flows used by investing activities:
Origination of loans (47,256 ) (66,199 )
Purchase of:
Investment securities - AFS (75,656 ) (10,310 )
Investment securities - HTM (573 )
Maturities, calls and principal payments of:
Loans 29,011 27,996
Investment securities - AFS 33,054 34,640
Investment securities - HTM 1,481 6,181
Proceeds from sale of investment securities - AFS 11,601 25,258
Purchase of bank owned life insurance (5,000 ) (5,001 )
Net increase in FHLB of Boston stock (150 )
Purchase of banking premises and equipment (112 ) (209 )
Net cash used by investing activities (53,600 ) 12,356  
Cash flows provided by financing activities:
Net increase in deposits 31,168 15,817
Net increase/(decrease) in short-term borrowings 37,500 (1,453 )
Proceeds from issuance of common stock 105 436
Repurchase of common stock (3 ) (109 )
Cash dividends paid on common stock (1,414 ) (1,319 )
Net cash provided by financing activities 67,356   13,372  
Net increase (decrease) in cash and cash equivalents 17,392 30,964
Cash and cash equivalents at beginning of period 22,512   15,756  
Cash and cash equivalents at end of period $ 39,904   $ 46,720  
 
Supplemental disclosure of cash flow information:
Cash paid for interest $ 868 $ 1,045
Cash paid for income taxes 50 145
Non-cash transactions:
Change in accumulated other comprehensive income, net of taxes (800 ) (1,189 )

Copyright Business Wire 2010

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