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United Financial Bancorp, Inc. Announces Record Quarterly Earnings in Third Quarter and Quarterly Dividend

  (October 18, 2016)

GLASTONBURY, Conn., Oct. 18, 2016 /PRNewswire/ -- United Financial Bancorp, Inc. ("United Financial" or "The Company") (NASDAQ Global Select Stock Market: "UBNK"), the holding company for United Bank ("The Bank"), announced results for the quarter ended September 30, 2016.

United Financial Bancorp, Inc.

The Company had net income of $14.2 million, or $0.28 per diluted share, for the quarter ended September 30, 2016, compared to net income for the linked quarter of $9.1 million, or $0.18 per diluted share. Adjusted operating net income (Non-GAAP) for the third quarter of  2016 was $14.1 million, or $0.28 per diluted share, compared to $10.0 million, or $0.20 per diluted share for the linked quarter. Adjusted operating net income for the second and third quarters of  2016 was adjusted primarily for purchase accounting impacts and the net gain from sales of securities. Additionally, in the second quarter of 2016, adjusted operating net income reflected the effect of position eliminations as part of the Company's announced reorganization plan. The Company reported net income of $13.4 million, or $0.27 per diluted share, for the quarter ended September 30, 2015.

"I am pleased to report that in the third quarter of 2016, United Financial Bancorp, Inc. delivered record quarterly earnings of $0.28 per share, in addition to a 2% linked quarter increase in tangible book value. Tangible book value increased to $10.60 at September 30, 2016 from $10.39 in the linked quarter after paying our shareholders a $0.12 per share dividend, or a 3.56% annualized dividend yield. These results were driven by improved revenue growth, disciplined expense management and excellent asset quality," stated William H. W.  Crawford, IV, Chief Executive Officer of the Company and the Bank. "I want to thank our United Bank teammates for their relentless focus on serving the financial needs of our customers and our communities."


Balance Sheet

Total assets at September 30, 2016 increased by $129.8 million to $6.54 billion from $6.42 billion at June 30, 2016. At September 30, 2016, total loans were $4.72 billion, representing a decrease of $10.2 million or 0.2%, from the linked quarter. Changes to loan balances during the third quarter of 2016 were highlighted by a $19.3 million, or 4.2%, increase in home equity loans and a $7.8 million, or 2.0%, increase in owner-occupied commercial real estate loans, partially offset by an $11.0 million, or 1.6%, decrease in commercial business loans. Total residential mortgages declined during the third quarter of 2016 by $42.2 million; while  total held for sale loans increased $52.8 million reflecting the Company's long-term strategy to reduce on-balance sheet exposure to residential mortgage loans.

Deposits totaled $4.70 billion at September 30, 2016 and increased by $240.1 million, or 5.4%, from $4.46 billion at June 30, 2016. Reflective of the Company's strategy to focus on low cost core deposit growth, increases in the third quarter of 2016 included a $14.2 million, or 2.1%, increase in non-interest bearing deposits and a $16.5 million, or 4.0%, increase in NOW checking deposits. The increase in money market deposits was in large part due to the return in the third quarter of the prior quarter seasonal outflows of municipal deposits in addition to new and increased balances in other areas of business. 

Total Federal Home Loan Bank advances and other borrowings declined by $119.3 million at September 30, 2016 from the linked quarter.

Net Interest Income

Net interest income increased by $1.5 million to $43.0 million during the third quarter of 2016 from $41.5 million during the linked quarter. Interest income totaled $53.3 million in the third quarter of 2016 and increased by $1.7 million, or 3.3%, in comparison to $51.6 million in the linked quarter. Interest expense increased by $182,000 to $10.3 million during the third quarter of 2016 from $10.1 million in the linked quarter. As communicated in the prior quarter, the Company planned to grow assets at a slower pace and as a result, average interest-earning assets increased slightly by $97.2 million, or 1.7%, from the linked quarter, while on an operating basis, net interest income increased by $1.1 million to $42.6 million during the third quarter of 2016 as compared to the linked quarter. The Company has reported growth in operating net interest income for the past six consecutive quarters.

The GAAP tax equivalent net interest margin for the third quarter of 2016 increased by four basis points to 2.98% compared to 2.94% for the linked quarter. The yield on interest-earning assets increased by four basis points in the third quarter of 2016 to 3.67% as compared to the linked quarter, and the total funding cost was unchanged at 0.72% in the quarter ending September 30, 2016 as compared to the linked quarter. The operating net interest margin, which excludes the impact of purchase accounting adjustments, increased by two basis points to 2.96% in the third quarter of 2016 from 2.94% in the linked quarter.

Provision for Loan Losses

The provision for loan losses increased by $142,000, or 3.9% to $3.8 million for the quarter ended September 30, 2016 compared to $3.6 million for the linked quarter due to covered loan portfolio growth.  Net charge-offs for the third quarter of 2016 decreased by $516,000 to $647,000, or 0.05% annualized as a percentage of average loans outstanding, from $1.2 million, or 0.10% annualized as a percentage of average loans outstanding in the linked quarter. Factors considered in the provision for loan losses include, but are not limited to, historical charge-offs, the composition of the portfolio, the current level of non-performing loans and charge-offs, local economic and credit conditions, the direction of real estate values and delinquency trends.

Non-Interest Income

Total non-interest income increased by $1.4 million, or 20.8%, to $7.9 million for the quarter ended September 30, 2016 from $6.5 million in the linked quarter. Adjusted operating non-interest income, which excludes the impact of gains on the sales of securities, increased by $1.6 million to $7.8 million, or 26.1%, for the third quarter of 2016. The increase in the third quarter's non-interest income was driven by an increase from core banking fees, commercial account analysis revenue and revenue growth in the Company's financial advisory line of business. Total non-interest income was flat from the comparable quarter in 2015.

Non-Interest Expense

Non-interest expense for the quarter ended September 30, 2016 totaled $32.2 million and decreased by $2.4 million, or 7.0%, from the linked quarter, while adjusted operating non-interest expense decreased by $1.1 million, or 3.3%. The main driver in the decline in non-interest expense during the quarter was the $1.7 million, or 8.6%, decrease in salaries and employee benefits expense as compared to the linked quarter due primarily to a $1.4 million decrease in salaries expense as a result of the Company's second quarter of 2016 reorganization plan execution. The Company's cost structure continues to be favorable with non-interest expense as a percentage of average assets reported at 2.00% and adjusted operating non-interest expense as a percentage of average assets reported at 1.98% for the quarter ended September 30, 2016, both on an annualized basis.  Total adjusted operating non-interest expense was flat from the comparable quarter in 2015.

Asset Quality

Asset quality remained strong and stable. Non-performing assets decreased by $3.6 million to $36.1 million at September 30, 2016 from $39.7 million at June 30, 2016. The ratio of non-performing assets to total assets as compared to the linked quarter decreased to 0.55% at September 30, 2016 from 0.62% at June 30, 2016.

Capital

The Company reported Tangible Common Equity ("TCE") of $534.7 million, or 8.31% of average assets, at September 30, 2016. Tangible book value per share increased to $10.60 at September 30, 2016 from $10.39 at June 30, 2016, primarily due to the impact of the Company's net income of $14.2 million, partially offset by the cash dividend payment to shareholders of $0.12 per share, which reduced shareholders' equity by $6.0 million. Book value per share at September 30, 2016 was $13.00.

Dividend

The Board of Directors declared a cash dividend on the Company's common stock of $0.12 per share to shareholders of record at the close of business on October 28, 2016 and payable on November 9, 2016. This dividend equates to a 3.56% annualized yield based on the $13.48 average closing price of the Company's common stock in the third quarter of 2016. The Company has paid dividends for 42 consecutive quarters.

Investor Conference Call

United Financial Bancorp, Inc. will host a conference call on Wednesday, October 19, 2016 at 10:00 a.m. Eastern Time (ET) to discuss the Company's third quarter results. Those wishing to participate in the call may dial toll-free 1-888-339-0797. A telephone replay of the call will be available through November 2, 2016 by calling 1-877-344-7529 and entering conference number 10094001. A podcast will be available on the Company's website for an extended period of time, as well as on the Company's investor relations app.

Investor Presentation

United Financial Bancorp, Inc. has prepared and furnished a visual slide presentation to accompany the earnings press release and investor conference call. The presentation has been furnished as an exhibit to the SEC Form 8-K, but is not included in this press release. Copies of the presentation may be accessed on the Company's investor relations website (www.unitedfinancialinc.com) by selecting "News & Market Data," then "Presentations;" or via the IRapp and selecting "Presentations;" or directly from SEC EDGAR.

About United Financial Bancorp, Inc.

United Financial Bancorp, Inc. is the holding company for United Bank, a full service financial services firm offering a complete line of commercial, business, and consumer banking products and services to customers throughout Connecticut and Massachusetts. United Bank is a financially strong, leading New England bank with more than 50 branches in two states and several commercial and residential loan production offices. United Financial Bancorp, Inc. trades on the NASDAQ Global Select Stock Exchange under the ticker symbol "UBNK." At September 30, 2016, the Company had $6.5 billion in assets.

For more information about United Bank's services and products call (866) 959-BANK or visit www.bankatunited.com. For more information about United Financial Bancorp, Inc., visit www.unitedfinancialinc.com or download the Company's free Investor Relations app on your Apple or Android device. To download United Financial Bancorp, Inc.'s investor relations app on your iPhone or on your iPad, which offers access to SEC documents, press releases, videos, audiocasts and more, please visit: https://itunes.apple.com/WebObjects/MZStore.woa/wa/viewSoftware?id=725271098&mt=8 or https://play.google.com/store/apps/details?id=com.theirapp.ubnk   for your Android mobile device.

Forward Looking Statements

This press release may contain certain forward-looking statements about the Company. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as "believe," "expect," "anticipate," "estimate," and "intend" or future or conditional verbs such as "will," "would," "should," "could," or "may." Forward-looking statements, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include increased competitive pressures, changes in the interest rate environment, general economic conditions or conditions within the securities markets, and legislative and regulatory changes that could adversely affect the business in which the Company and its subsidiaries are engaged.


 


 

United Financial Bancorp, Inc. and Subsidiaries

Consolidated Statements of Net Income

(Unaudited)




For the Three Months
Ended September 30,


For the Nine Months Ended
September 30,



2016


2015


2016


2015

Interest and dividend income:


(In thousands, except share data)

Loans


$

45,331



$

41,878



$

134,359



$

123,658


Securities-taxable interest


4,808



4,907



14,830



14,947


Securities-non-taxable interest


2,140



2,080



6,201



6,353


Securities-dividends


990



708



2,934



1,554


Interest-bearing deposits


67



52



207



119


Total interest and dividend income


53,336



49,625



158,531



146,631


Interest expense:









Deposits


6,279



5,319



18,927



15,643


Borrowed funds


4,028



2,663



11,677



7,099


Total interest expense


10,307



7,982



30,604



22,742


Net interest income


43,029



41,643



127,927



123,889


Provision for loan losses


3,766



3,252



10,078



9,225


Net interest income after provision for loan losses


39,263



38,391



117,849



114,664


Non-interest income:









Service charges and fees


5,726



5,960



14,679



15,434


Net gain (loss) from sales of securities


48



(59)



1,867



639


Income from mortgage banking activities


2,198



2,257



5,389



7,618


Bank-owned life insurance income


899



893



2,531



2,557


Net loss on limited partnership investments


(850)



(991)



(3,290)



(2,337)


Other (loss) income


(132)



(242)



(28)



113


Total non-interest income


7,889



7,818



21,148



24,024


Non-interest expense:









Salaries and employee benefits


18,301



16,994



56,105



50,161


Service bureau fees


1,960



1,828



6,219



5,114


Occupancy and equipment


3,580



3,343



11,330



11,600


Professional fees


1,125



1,581



2,893



3,280


Marketing and promotions


656



587



2,271



1,843


FDIC insurance assessments


819



750



2,800



2,651


Core deposit intangible amortization


385



433



1,219



1,363


FHLBB prepayment penalties


?



?



1,454



?


Other


5,410



6,360



16,389



16,878


Total non-interest expense


32,236



31,876



100,680



92,890


Income before income taxes


14,916



14,333



38,317



45,798


Provision for income taxes


757



952



3,206



6,060


Net income


$

14,159



$

13,381



$

35,111



$

39,738











Net income per share:









Basic


$

0.28



$

0.27



$

0.71



$

0.81


Diluted


$

0.28



$

0.27



$

0.70



$

0.81


Weighted-average shares outstanding:









Basic


49,800,105



48,931,203



49,617,136



48,829,193


Diluted


50,091,202



49,429,809



49,900,391



49,339,271


 

 

United Financial Bancorp, Inc. and Subsidiaries

Consolidated Statements of Net Income

(Unaudited)




For the Three Months Ended



September 30,
2016


June 30,
2016


March 31,
2016


December 31,
2015


September 30,
2015

Interest and dividend income:


(In thousands)

Loans


$

45,331



$

43,556



$

45,472



$

41,751



$

41,878


Securities-taxable interest


4,808



4,926



5,096



5,092



4,907


Securities-non-taxable interest


2,140



2,051



2,010



2,001



2,080


Securities-dividends


990



1,021



923



809



708


Interest-bearing deposits


67



67



73



61



52


Total interest and dividend income


53,336



51,621



53,574



49,714



49,625


Interest expense:











Deposits


6,279



6,382



6,266



5,799



5,319


Borrowed funds


4,028



3,743



3,906



3,222



2,663


Total interest expense


10,307



10,125



10,172



9,021



7,982


Net interest income


43,029



41,496



43,402



40,693



41,643


Provision for loan losses


3,766



3,624



2,688



3,780



3,252


Net interest income after provision for loan losses


39,263



37,872



40,714



36,913



38,391


Non-interest income:











Service charges and fees


5,726



4,359



4,594



5,606



5,960


Net gain (loss) from sales of securities


48



367



1,452



300



(59)


Income from mortgage banking activities


2,198



2,331



860



1,934



2,257


Bank-owned life insurance income


899



814



818



1,059



893


Net loss on limited partnership investments


(850)



(1,504)



(936)



(799)



(991)


Other (loss) income


(132)



165



(61)



363



(242)


Total non-interest income


7,889



6,532



6,727



8,463



7,818


Non-interest expense:











Salaries and employee benefits


18,301



20,013



17,791



17,308



16,994


Service bureau fees


1,960



2,230



2,029



1,614



1,828


Occupancy and equipment


3,580



3,850



3,900



3,842



3,343


Professional fees


1,125



887



881



3,037



1,581


Marketing and promotions


656



1,023



592



478



587


FDIC insurance assessments


819



1,042



939



1,041



750


Core deposit intangible amortization


385



401



433



433



433


Merger related expense


?



?



?



1,575



?


FHLBB prepayment penalties


?



?



1,454



?



?


Other


5,410



5,235



5,744



5,977



6,360


Total non-interest expense


32,236



34,681



33,763



35,305



31,876


Income before income taxes


14,916



9,723



13,678



10,071



14,333


Provision for income taxes


757



665



1,784



169



952


Net income


$

14,159



$

9,058



$

11,894



$

9,902



$

13,381













Net income per share:











Basic


$

0.28



$

0.18



$

0.24



$

0.20



$

0.27


Diluted


$

0.28



$

0.18



$

0.24



$

0.20



$

0.27


Weighted-average shares outstanding:











Basic


49,800,105



49,623,472



49,423,218



49,160,925



48,931,203


Diluted


50,091,202



49,946,639



49,652,632



49,621,935



49,429,809


 

 

United Financial Bancorp, Inc. and Subsidiaries

Consolidated Statements of Condition

(Unaudited)




September 30,
2016


June 30,
2016


March 31,
2016


December 31,
2015


September 30,
2015

ASSETS


(In thousands)

Cash and cash equivalents:











Cash and due from banks


$

51,951



$

54,792



$

46,618



$

47,602



$

38,534


Short-term investments


162,295



42,649



40,616



47,574



59,776


Total cash and cash equivalents


214,246



97,441



87,234



95,176



98,310


Available for sale securities At fair value


1,052,439



1,073,459



1,090,498



1,059,169



1,080,393


Held to maturity securities At amortized cost


14,162



14,289



14,434



14,565



14,715


Loans held for sale


83,321



30,558



7,560



10,136



13,511


Loans:











Commercial real estate loans:











Owner-occupied


392,168



384,324



376,511



322,084



340,047


Investor non-owner occupied


1,702,701



1,675,821



1,648,321



1,673,248



1,580,848


Construction


90,380



107,302



128,007



129,922



146,975


Total commercial real estate loans


2,185,249



2,167,447



2,152,839



2,125,254



2,067,870


Commercial business loans


660,676



671,687



614,235



603,332



576,899


Consumer loans:











Residential real estate


1,129,079



1,171,300



1,176,357



1,179,915



1,190,745


Home equity


479,390



460,058



446,515



431,282



335,220


Residential construction


52,476



49,338



42,205



41,084



33,648


Other consumer


213,830



211,065



217,725



233,064



5,236


Total consumer loans


1,874,775



1,891,761



1,882,802



1,885,345



1,564,849


Total loans


4,720,700



4,730,895



4,649,876



4,613,931



4,209,618


Net deferred loan costs and premiums


10,214



9,403



7,612



7,018



6,246


Allowance for loan losses


(41,080)



(37,961)



(35,500)



(33,887)



(30,832)


Loans receivable - net


4,689,834



4,702,337



4,621,988



4,587,062



4,185,032


Federal Home Loan Bank of Boston stock, at cost


52,847



55,989



55,989



51,196



40,814


Accrued interest receivable


17,888



16,635



16,922



15,740



15,477


Deferred tax asset, net


32,529



31,395



32,222



33,094



31,554


Premises and equipment, net


52,520



53,021



53,685



54,779



55,919


Goodwill


115,281



115,281



115,281



115,281



115,281


Core deposit intangible asset


6,287



6,672



7,073



7,506



7,939


Cash surrender value of bank-owned life insurance


126,948



126,734



125,920



125,101



125,186


Other assets


86,553



91,273



90,438



59,736



58,891


Total assets


$

6,544,855



$

6,415,084



$

6,319,244



$

6,228,541



$

5,843,022



























































September 30,
2016


June 30,
2016


March 31,
2016


December 31,
2015


September 30,
2015

LIABILITIES AND STOCKHOLDERS' EQUITY











Liabilities:











Deposits:











Non-interest-bearing


$

687,865



$

673,624



$

657,144



$

657,718



$

622,535


Interest-bearing


4,007,606



3,781,717



3,876,901



3,779,353



3,640,436


Total deposits


4,695,471



4,455,341



4,534,045



4,437,071



4,262,971


Mortgagors' and investor escrow accounts


9,045



14,040



9,696



13,526



8,108


Federal Home Loan Bank advances and other borrowings


1,102,882



1,222,160



1,073,034



1,099,020



893,865


Accrued expenses and other liabilities


81,217



79,350



69,191



53,403



56,626


Total liabilities


5,888,615



5,770,891



5,685,966



5,603,020



5,221,570


Total stockholders' equity


656,240



644,193



633,278



625,521



621,452


Total liabilities and stockholders' equity


$

6,544,855



$

6,415,084



$

6,319,244



$

6,228,541



$

5,843,022


 

 


United Financial Bancorp, Inc. and Subsidiaries

Selected Financial Highlights

(Dollars In Thousands, Except Share Data)

(Unaudited)



At or For the Three Months Ended


September 30,
 2016


June 30,
 2016


March 31,
 2016


December 31,
 2015


September 30,
 2015

Share Data:










Basic net income per share

$

0.28



$

0.18



$

0.24



$

0.20



$

0.27


Diluted net income per share

0.28



0.18



0.24



0.20



0.27


Dividends declared per share

0.12



0.12



0.12



0.12



0.12


Key Statistics:










Total revenue

$

50,918



$

48,028



$

50,129



$

49,156



$

49,461


Total non-interest expense

32,236



34,681



33,763



35,305



31,876


Average earning assets

5,984,951



5,887,738



5,849,517



5,575,297



5,332,758


Key Ratios:










Return on average assets (annualized)

0.88

%


0.57

%


0.76

%


0.66

%


0.93

%

Return on average equity (annualized)

8.80

%


5.71

%


7.59

%


6.35

%


8.68

%

Tax-equivalent net interest margin (annualized)

2.98

%


2.94

%


3.09

%


3.02

%


3.20

%

Residential Mortgage Production:










Dollar volume (total)

$

173,473



$

173,507



$

124,058



$

146,271



$

187,926


Mortgages originated for purchases

113,019



100,871



66,696



95,927



131,609


Loans sold

99,051



93,681



89,758



119,289



123,316


Income from mortgage banking activities

2,198



2,331



860



1,934



2,257


Non-performing Assets:










Residential real estate

$

11,526



$

11,729



$

11,725



$

11,193



$

10,975


Home equity

3,650



3,176



3,036



2,786



3,602


Investor-owned commercial real estate

3,746



5,618



5,297



8,565



6,505


Owner-occupied commercial real estate

2,838



3,815



3,115



2,939



5,076


Construction

1,879



2,103



2,114



2,808



1,604


Commercial business

2,016



4,364



3,979



3,898



4,475


Other consumer

328



1,505



19



2



3


Non-accrual loans

25,983



32,310



29,285



32,191



32,240


Troubled debt restructured non-accruing

7,345



6,713



7,143



5,611



4,605


Total non-performing loans

33,328



39,023



36,428



37,802



36,845


Other real estate owned

2,792



702



659



755



258


Total non-performing assets

$

36,120



$

39,725



$

37,087



$

38,557



$

37,103


Non-performing loans to total loans

0.71

%


0.82

%


0.78

%


0.82

%


0.88

%

Non-performing assets to total assets

0.55

%


0.62

%


0.59

%


0.62

%


0.63

%

Allowance for loan losses to non-performing loans

123.26

%


97.28

%


97.45

%


89.64

%


83.68

%

Allowance for loan losses to total loans

0.87

%


0.80

%


0.76

%


0.73

%


0.73

%

Non-GAAP Ratios: (1)










Non-interest expense to average assets (annualized)

2.00

%


2.19

%


2.15

%


2.37

%


2.22

%

Efficiency ratio (2)

59.50

%


64.54

%


61.98

%


62.20

%


61.20

%

Cost of funds (annualized) (3)

0.72

%


0.72

%


0.73

%


0.68

%


0.63

%

Total revenue growth rate

6.02

%


(4.19)%



1.98

%


(0.62)%



(1.62)%


Total revenue growth rate (annualized)

24.07

%


(16.77)%



7.92

%


(2.47)%



(6.47)%


Average earning asset growth rate

1.65

%


0.65

%


4.92

%


4.55

%


4.31

%

Average earning asset growth rate (annualized)

6.60

%


2.61

%


19.67

%


18.19

%


17.23

%

Return on average tangible common equity (annualized)

11.05

%


7.28

%


9.65

%


8.14

%


11.08

%

Pre-provision net revenue to average assets (4)

1.32

%


1.11

%


1.21

%


1.17

%


1.38

%

Operating pre-provision net revenue to average assets (5)

1.16

%


0.94

%


0.95

%


1.03

%


0.96

%

 


(1)

Non-GAAP Ratios are not financial measurements required by generally accepted accounting principles; however, management believes such information is useful to investors in evaluating Company performance.

(2)

The efficiency ratio represents the ratio of non-interest expense before other real estate owned expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and non-interest income, excluding gains from securities transactions, losses on partnerships and nonrecurring items.

(3)

The cost of funds ratio represents interest incurred on liabilities as a percentage of average non-interest bearing deposits and interest-bearing liabilities.

(4)

The pre-provision net revenue to average assets ratio represents the ratio of net interest income, on a fully tax-equivalent basis, fees and other non-interest income, as a percent of average assets.

(5)

The operating pre-provision net revenue to average assets ratio represents the ratio of operating net interest income, on a fully tax-equivalent basis, fees and other operating non-interest income, as a percent of average assets.

 

 

United Financial Bancorp, Inc. and Subsidiaries

Average Balance Sheets, Interest and Yields/Costs

(Dollars In Thousands)

(Unaudited)



For the Three Months Ended


September 30, 2016


September 30, 2015


Average
Balance


Interest
and
Dividends


Yield/Cost


Average
Balance


Interest
and
Dividends


Yield/Cost

Interest-earning assets:












Residential real estate

$

1,229,384



$

10,205



3.32

%


$

1,205,060



$

10,221



3.39

%

Commercial real estate

2,077,585



20,952



4.01



1,816,122



18,833



4.11


Construction

156,217



1,447



3.68



173,355



1,952



4.47


Commercial business

669,595



6,348



3.77



612,857



8,112



5.25


Home equity

467,552



4,388



3.75



334,302



2,710



3.24


Other consumer

209,255



2,527



4.83



4,265



50



4.67


Investment securities

1,129,133



9,123



3.23



1,123,005



8,843



3.15


Other earning assets

46,230



67



0.58



63,740



52



0.33


Total interest-earning assets

5,984,951



55,057



3.67



5,332,706



50,773



3.79


Allowance for loan losses

(38,916)







(29,901)






Non-interest-earning assets

491,061







449,363






Total assets

$

6,437,096







$

5,752,168






Interest-bearing liabilities:












NOW and money market

$

1,485,372



$

1,501



0.40

%


$

1,500,449



$

1,874



0.50

%

Savings

527,225



77



0.06



527,430



82



0.06


Certificates of deposit

1,821,061



4,701



1.03



1,591,618



3,363



0.84


Total interest-bearing deposits

3,833,658



6,279



0.65



3,619,497



5,319



0.58


Federal Home Loan Bank advances

1,085,932



2,657



0.97



695,208



1,276



0.73


Other borrowings

119,902



1,371



4.55



146,936



1,387



3.75


Total interest-bearing liabilities

5,039,492



10,307



0.81



4,461,641



7,982



0.71


Non-interest-bearing deposits

662,243







610,253






Other liabilities

92,095







63,620






Total liabilities

5,793,830







5,135,514






Stockholders' equity

643,266







616,654






Total liabilities and stockholders' equity

$

6,437,096







$

5,752,168






Net interest-earning assets

$

945,459







$

871,065






Tax-equivalent net interest income



44,750







42,791




Tax-equivalent net interest rate spread





2.86

%






3.08

%

Tax-equivalent net interest margin





2.98

%






3.20

%

Average interest-earning assets to average interest-bearing liabilities





118.76

%






119.52

%

Less tax-equivalent adjustment



1,721







1,148




Net interest income



$

43,029







$

41,643




 

 

United Financial Bancorp, Inc. and Subsidiaries

Average Balance Sheets, Interest and Yields/Costs

(Dollars In Thousands)

(Unaudited)




For the Three Months Ended



September 30, 2016


June 30, 2016



Average
Balance


Interest
and
Dividends


Yield/Cost


Average
Balance


Interest
and
Dividends


Yield/Cost

Interest-earning assets:













Residential real estate


$

1,229,384



$

10,205



3.32

%


$

1,199,406



$

10,077



3.36

%

Commercial real estate


2,077,585



20,952



4.01



2,028,664



20,667



4.10


Construction


156,217



1,447



3.68



164,717



1,539



3.76


Commercial business


669,595



6,348



3.77



636,986



5,575



3.52


Home equity


467,552



4,388



3.75



445,391



3,583



3.22


Other consumer


209,255



2,527



4.83



218,321



2,657



4.87


Investment securities


1,129,133



9,123



3.23



1,151,926



9,131



3.16


Other earning assets


46,230



67



0.58



42,327



67



0.63


Total interest-earning assets


5,984,951



55,057



3.67



5,887,738



53,296



3.63


Allowance for loan losses


(38,916)







(36,357)






Non-interest-earning assets


491,061







475,060






Total assets


$

6,437,096







$

6,326,441






Interest-bearing liabilities:













NOW and money market


$

1,485,372



$

1,501



0.40

%


$

1,540,997



$

1,666



0.43

%

Savings


527,225



77



0.06



537,276



79



0.06


Certificates of deposit


1,821,061



4,701



1.03



1,783,687



4,637



1.05


Total interest-bearing deposits


3,833,658



6,279



0.65



3,861,960



6,382



0.66


Federal Home Loan Bank advances


1,085,932



2,657



0.97



985,424



2,369



0.97


Other borrowings


119,902



1,371



4.55



121,587



1,374



4.55


Total interest-bearing liabilities


5,039,492



10,307



0.81



4,968,971



10,125



0.82


Non-interest-bearing deposits


662,243







641,168






Other liabilities


92,095







81,927






Total liabilities


5,793,830







5,692,066






Stockholders' equity


643,266







634,375






Total liabilities and stockholders' equity


$

6,437,096







$

6,326,441






Net interest-earning assets


$

945,459







$

918,767






Tax-equivalent net interest income




44,750







43,171




Tax-equivalent net interest rate spread






2.86

%






2.81

%

Tax-equivalent net interest margin






2.98

%






2.94

%

Average interest-earning assets to average interest-bearing liabilities






118.76

%






118.49

%

Less tax-equivalent adjustment




1,721







1,675




Net interest income




$

43,029







$

41,496




 

 

 

 

United Financial Bancorp, Inc. and Subsidiaries

Average Balance Sheets, Interest and Yields/Costs

(Dollars In Thousands)

(Unaudited)




For the Nine Months Ended September 30,



2016


2015



Average
Balance


Interest
and
Dividends


Yield/Cost


Average
Balance


Interest
and
Dividends


Yield/Cost

Interest-earning assets:













Residential real estate


$

1,211,995



$

30,482



3.35

%


$

1,158,506



$

29,978



3.45

%

Commercial real estate


2,039,087



62,492



4.09



1,713,690



57,437



4.48


Construction


164,039



4,964



4.04



169,754



6,150



4.84


Commercial business


638,086



18,180



3.81



616,395



21,986



4.77


Home equity


448,371



11,681



3.47



333,830



7,974



3.18


Other consumer


218,801



8,142



4.96



5,233



133



3.38


Investment securities


1,138,559



27,392



3.21



1,126,343



26,363



3.12


Other earning assets


48,755



207



0.57



54,234



119



0.29


Total interest-earning assets


5,907,693



163,540



3.69



5,177,985



150,140



3.87


Allowance for loan losses


(37,091)







(27,308)






Non-interest-earning assets


479,815







452,094






Total assets


$

6,350,417







$

5,602,771






Interest-bearing liabilities:













NOW and money market


$

1,533,133



$

4,950



0.43

%


$

1,449,105



$

5,357



0.49

%

Savings


527,919



229



0.06



533,851



248



0.06


Certificates of deposit


1,784,269



13,748



1.03



1,563,821



10,038



0.86


Total interest-bearing deposits


3,845,321



18,927



0.66



3,546,777



15,643



0.59


Federal Home Loan Bank advances


1,009,671



7,507



0.99



619,906



2,944



0.63


Other borrowings


130,586



4,170



4.27



161,894



4,155



3.43


Total interest-bearing liabilities


4,985,578



30,604



0.82



4,328,577



22,742



0.70


Non-interest-bearing deposits


646,379







594,204






Other liabilities


83,529







68,551






Total liabilities


5,715,486







4,991,332






Stockholders' equity


634,931







611,439






Total liabilities and stockholders' equity


$

6,350,417







$

5,602,771






Net interest-earning assets


$

922,115







$

849,408






Tax-equivalent net interest income




132,936







127,398




Tax-equivalent net interest rate spread






2.87

%






3.17

%

Tax-equivalent net interest margin






3.00

%






3.28

%

Average interest-earning assets to average interest-bearing liabilities






118.50

%






119.62

%

Less tax-equivalent adjustment




5,009







3,509




Net interest income




$

127,927







$

123,889




 

 



 

United Financial Bancorp, Inc. and Subsidiaries

Reconciliation of Non-GAAP Financial Measures

(Dollars In Thousands)

(Unaudited)




Three Months Ended



September 30,
 2016


June 30,
 2016


March 31,
 2016


December 31,
 2015


September 30,
 2015

Net income


$

14,159



$

9,058



$

11,894



$

9,902



$

13,381


Adjustments:











Net interest income


(383)



35



(1,900)



(1,617)



(4,092)


Non-interest income


(118)



(367)



(1,452)



(519)



59


Non-interest expense


447



1,814



1,893



3,586



244


Income tax (benefit) expense


19



(518)



511



(65)



1,326


Net adjustment


(35)



964



(948)



1,385



(2,463)


Total adjusted operating net income


$

14,124



$

10,022



$

10,946



$

11,287



$

10,918


Total net interest income


$

43,029



$

41,496



$

43,402



$

40,693



$

41,643


Adjustments:











Impact from purchase accounting fair value marks:







Amortization (accretion) of loan mark


403



835



(1,094)



(718)



(2,787)


Accretion of deposit mark


359



359



359



444



841


Accretion of borrowings mark


427



441



447



455



464


Net adjustment


(383)



35



(1,900)



(1,617)



(4,092)


Total operating net interest income


$

42,646



$

41,531



$

41,502



$

39,076



$

37,551


Total non-interest income


$

7,889



$

6,532



$

6,727



$

8,463



$

7,818


Adjustments:











Net (gain) loss on sales of securities


(48)



(367)



(1,452)



(300)



59


BOLI claim benefit


(70)



?



?



(219)



?


Net adjustment


(118)



(367)



(1,452)



(519)



59


Total adjusted operating non-interest income


7,771



6,165



5,275



7,944



7,877


Total operating net interest income


42,646



41,531



41,502



39,076



37,551


Total operating revenue


$

50,417



$

47,696



$

46,777



$

47,020



$

45,428


Total non-interest expense


$

32,236



$

34,681



$

33,763



$

35,305



$

31,876


Adjustments:











Merger related expense


?



?



?



(1,575)



?


Core deposit intangible amortization expense


(385)



(401)



(433)



(433)



(433)


Loan portfolio acquisition fees


?



?



?



(1,572)



?


Effect of position eliminations


(55)



(1,403)



?



?



?


Effect of branch lease termination agreement


?



?



?



?



195


Amortization of fixed asset fair value mark


(7)



(10)



(6)



(6)



(6)


FHLBB prepayment penalties


?



?



(1,454)



?



?


Net adjustment


(447)



(1,814)



(1,893)



(3,586)



(244)


Total adjusted operating non-interest expense


$

31,789



$

32,867



$

31,870



$

31,719



$

31,632













Total loans


$

4,720,700



$

4,730,895



$

4,649,876



$

4,613,931



$

4,209,618


Non-covered loans (1)


(721,763)



(1,259,285)



(1,334,303)



(1,448,435)



(1,255,618)


Total covered loans


$

3,998,937



$

3,471,610



$

3,315,573



$

3,165,496



$

2,954,000


Allowance for loan losses


$

41,080



$

37,961



$

35,500



$

33,887



$

30,832


Allowance for loan losses to total loans


0.87

%


0.80

%


0.76

%


0.73

%


0.73

%

Allowance for loan losses to total covered loans


1.03

%


1.09

%


1.07

%


1.07

%


1.04

%

(1)

As required by GAAP, the Company recorded acquired loans at fair value. These loans carry no allowance for loan losses for the periods reflected above.

 

United Financial Bancorp, Inc. and Subsidiaries

Selected Interest Income/Expense and Yields/Costs

Reconciliation of Non-GAAP Financial Measures

(Dollars In Thousands)

(Unaudited)




Three Months Ended September 30, 2016



GAAP


Mark to Market


Operating



Interest

and

Dividends


Yield/Cost


Interest

and

Dividends


Yield/Cost


Interest

and

Dividends


Yield/Cost

Residential real estate


$

10,205



3.32

%


$

(483)



(0.18)%



$

10,688



3.50

%

Commercial real estate


20,952



4.01



545



0.11



20,407



3.90


Construction


1,447



3.68



39



0.11



1,408



3.57


Commercial business


6,348



3.77



329



0.22



6,019



3.55


Home equity


4,388



3.75



(293)



(0.30)



4,681



4.05


Other consumer


2,527



4.83



(540)



(1.14)



3,067



5.97


Certificates of deposit


4,701



1.03



(359)



(0.08)



5,060



1.11


Federal Home Loan Bank advances


2,657



0.97



(445)



(0.17)



3,102



1.14


Other borrowings


1,371



4.55



18



0.12



1,353



4.43


Tax-equivalent net interest margin


44,750



2.98



383





44,367



2.96






























Three Months Ended June 30, 2016



GAAP


Mark to Market


Operating



Interest
and
Dividends


Yield/Cost


Interest
and
Dividends


Yield/Cost


Interest
and
Dividends


Yield/Cost

Residential real estate


$

10,077



3.36

%


$

(489)



(0.18)%



$

10,566



3.54

%

Commercial real estate


20,667



4.10



566



0.13



20,101



3.97


Construction


1,539



3.76



96



0.27



1,443



3.49


Commercial business


5,575



3.52



263



0.19



5,312



3.33


Home equity


3,583



3.22



(815)



(0.77)



4,398



3.99


Other consumer


2,657



4.87



(456)



(0.89)



3,113



5.76


Certificates of deposit


4,637



1.05



(359)



(0.08)



4,996



1.13


Federal Home Loan Bank advances


2,369



0.97



(457)



(0.19)



2,826



1.16


Other borrowings


1,374



4.55



16



0.12



1,358



4.43


Tax-equivalent net interest margin


43,171



2.94



(35)





43,206



2.94


 

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SOURCE United Financial Bancorp, Inc.

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