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Bar Harbor Bankshares Reports Second Quarter 2024 Results; Declares Dividend

BAR HARBOR, ME / ACCESSWIRE / July 18, 2024 / Bar Harbor Bankshares (NYSE American:BHB) (the "Company") reported second quarter 2024 GAAP net income of $10.3 million and $0.67 per diluted share and core (Non-GAAP) net income of $10.0 million or $0.66 per diluted share compared to GAAP and core (Non-GAAP) net income $10.8 million or $0.71 per diluted share in the same quarter of 2023.

SECOND QUARTER 2024 HIGHLIGHTS

  • Return on assets of 1.04%

  • Commercial loan growth of 14% annualized

  • Net interest margin ("NIM") of 3.09%

  • Non-accruing loans to total loans ratio of 0.20%

  • 14% growth in trust and investment fee income

Bar Harbor Bankshares' President and Chief Executive Officer, Curtis C. Simard, stated, "We delivered another solid quarter, demonstrating our commitment to consistent, sustainable long-term performance. Our continued perseverance is seen in our results as we have been able to defend our NIM relative to our peers. Our wealth management team continues to perform well with strong client retention and new client acquisitions of over $100.0 million which will fund over the next several quarters. I am proud of our teamwork, dedication to risk management, and purposeful expense control, which when paired with our strong calling culture will continue to drive our success in the second half of the year."

DIVIDEND DECLARED
The Board of Directors of the Company voted to declare a cash dividend of $0.30 per share to shareholders of record at the close of business on August 15, 2024 payable on September 13, 2024. This dividend equates to a 4.46% annualized yield based on the $26.88 closing share price of the Company's common stock on June 28, 2024, the last trading day of the second quarter 2024.

FINANCIAL CONDITION (June 30, 2024 compared to March 31, 2024)
Total assets grew $75.2 million at the end of the second quarter 2024 compared to the first quarter 2024 primarily due to loan growth and higher cash balances, partially offset by lower securities available for sale at the end of the second quarter.

Total cash and cash equivalents were $101.8 million, compared to $76.2 million at end of the first quarter 2024. Interest-earning deposits held with other banks totaled $62.2 million compared to $45.4 million at end of the first quarter and yielded 5.65% and 5.88%, respectively.

Total loans grew $52.5 million or 7% on an annualized basis. Commercial loans grew by $68.6 million or 14% annualized primarily driven by a $59.9 million, or 15% increase in commercial real estate and a $8.7 million, or 8%, increase in commercial and industrial loans. Residential loans decreased by $18.5 million, or 8% annualized, compared to the first quarter 2024 as we continue to focus on our held-for-sale mortgage business and allocate portfolio balances to higher yielding commercial loans. Consumer loans increased $3.9 million, or 16% annualized, driven by new home equity line originations in the second quarter 2024.

Securities available for sale decreased to $512.9 million compared to $527.6 million in the first quarter 2024 driven by pay downs of $22.0 million, called securities of $3.5 million, matured securities of $3.0 million and net amortization of $408 thousand, partially offset by security purchases of $18.1 million. Federal Home Loan Bank ("FHLB") stock increased to $14.8 million in the second quarter 2024 compared to $10.0 million in the first quarter 2024 driven by higher FHLB borrowings. Fair value adjustments decreased the security portfolio by $68.5 million at quarter-end of this quarter compared to $64.9 million at the end of the first quarter. The weighted average yield of the total securities portfolio for the second quarter 2024 was 4.00% compared to 4.02% at the end of the previous quarter primarily due to a run-off of lower coupon fixed-rate securities. As of the end of the first and second quarters 2024, respectively, our securities portfolio maintained an average life of nine years with an effective duration of five years and all securities remain classified as available for sale to provide flexibility in asset funding and other opportunities as they arise.

The allowance for credit losses increased $500 thousand to $28.9 million at the end of the second quarter 2024 compared to $28.4 million at the end of the first quarter 2024. Our allowance for credit losses continues to be driven by a combination of portfolio loan growth, nominal credit movement and general macroeconomic trends. Non-accruing loans decreased during the second quarter 2024 to $6.3 million from $6.9 million in the first quarter 2024. Charge-offs and specific reserves on non-accruing loans continue to be nominal, supported by relatively strong collateral values.

Total deposits remained at $3.1 billion at the end of the second quarter 2024. We continued to see a shift from non-maturity deposits to certificate of deposit accounts ("CDs"), as CDs increased $23.9 million in the second quarter versus the first quarter 2024. The increase was primarily driven by $6.8 million in personal CDs, $6.4 million in brokered deposits, $6.3 million in non-personal CDs, and $4.4 million in Certificate of Deposit Account Registry Service, also known as CDARS, deposits. Non-maturity deposits decreased 2% on an annualized basis or $10.6 million. Senior borrowings increased $59.9 million to $329.3 million from the first quarter 2024 driven by funding loan growth and liquidity.

The Company's book value per share was $28.81 as of June 30, 2024 compared to $28.64 as of March 31, 2024. Unrealized losses on securities, net of taxes, reduced book value per share by $3.44 and $3.26 at the end of those respective periods. Tangible book value per share (Non-GAAP) was $20.68 at the end of the second quarter 2024, compared to $20.48 at the end of the first quarter 2024.

RESULTS OF OPERATIONS (June 30, 2024 compared to June 30, 2023)
Net interest margin was 3.09% compared to 3.22% in the second quarter 2023. The decrease was primarily driven by higher cost of funds, partially offset by lower borrowing costs. The yield on loans grew 42 basis points to 5.41% in the second quarter 2024, up from 4.99% in the same quarter 2023. Costs of interest-bearing deposits increased to 2.35% from 1.45% in the second quarter 2023 driven by the competitive pricing within the interest rate environment and change in deposit mix as we continue to experience a shift from non-maturity deposits to CDs. Borrowings decreased $69.5 million from the second quarter 2023 compounded with a 16 basis point decrease in yields on interest bearing liabilities to 4.57% in the second quarter 2024.

Total interest and dividend income increased by 9.2% to $46.8 million in the second quarter 2023 primarily driven by the repricing of adjustable-rate loans and originations of higher fixed-rate loans within the commercial portfolio. The yield on commercial real estate loans grew to 5.61% at the end of the second quarter 2024 from 5.21% in the second quarter 2023. Commercial and industrial yield grew to 6.76% at the end of the second quarter 2024 compared to 6.42% at the end of the second quarter 2023. Yields on earning assets continue to grow to 5.18% compared to 4.77% in the second quarter 2023.

The provision for credit losses was $585 thousand compared to $750 thousand in the second quarter 2023 as net charge-offs to total loans continue to remain nominal. Credit quality continues to be strong as non-accruing loans to total loans was 0.20% at the end of the second quarter 2024 compared to 0.22% in the second quarter 2023. Total delinquent and non-accruing loans to total loans was 0.30% at the end of the second quarter 2024 to compared to 0.33% in the second quarter 2023.

Non-interest income was $9.6 million in the second quarter 2024 compared to $9.0 million in the same quarter 2023. Wealth management income grew 10% to $4.2 million compared to $3.8 million in the in the second quarter 2023. Assets under management grew 12% in the second quarter 2024 to $2.6 billion from $2.3 billion in the second quarter 2023 driven by higher security valuations and a 2% growth in the managed accounts. Mortgage banking income increased $180 thousand compared to the second quarter 2023 driven by increased margins on our held-for-sale mortgage business.

Non-interest expense was $24.0 million in the second quarter 2024 compared to $23.4 million in the second quarter 2023 driven by salary and benefits, and other expenses, partially offset by the gain on sale of our Avery Lane office and lower professional services fees. Salary and benefit expenses increased 5%, or $637 thousand, from the comparative quarter 2023 driven in part by stock compensation due to increases in stock price and lower loan origination fee deferrals in the second quarter 2024. Other expenses increased to $4.4 million from $4.2 million in the second quarter 2023 primarily due to increases in charitable contributions to the community, software expenses, and debit and ATM card expenses.

BACKGROUND
Bar Harbor Bankshares (NYSE American: BHB) is the parent company of its wholly-owned subsidiary, Bar Harbor Bank & Trust. Founded in 1887, Bar Harbor Bank & Trust is a true community bank serving the financial needs of its clients for over 135 years. Bar Harbor Bank & Trust provides full-service community banking with office locations in all three Northern New England states of Maine, New Hampshire and Vermont. For more information, visit www.barharbor.bank.

FORWARD-LOOKING STATEMENTS
All statements, other than statements of historical fact, included in this release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. When used in this release the words "believe," "anticipate," "expect," "may," "will," "assume," "should," "predict," "could," "would," "intend," "targets," "estimates," "projects," "plans," and "potential," and other similar words and expressions of the future, are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking, including statements relating to Company's balance sheet management, our credit trends, our overall credit performance, and the Company's strategic plans, objectives, and intentions. All forward-looking statements are subject to risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of the Company to differ materially from any results, performance, or achievements expressed or implied by such forward-looking statements. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from the statements, including, but not limited to: (1) changes in general business and economic conditions on a national basis and in our markets throughout Northern New England; (2) changes in consumer behavior due to political, business, and economic conditions, including inflation and concerns about liquidity; (3) the possibility that our asset quality could decline or that we experience greater loan losses than anticipated; (4) the impact of liquidity needs on our results of operations and financial condition; (5) changes in the size and nature of our competition; (6) the effect of interest rate increases on the cost of deposits; (7) unanticipated weakness in loan demand, pricing or collectability; (8) the possibility that future credit losses are higher than currently expected due to changes in economic assumptions or adverse economic developments; (9) operational risks including, but not limited to, changes in information technology, cybersecurity incidents, fraud, natural disasters, climate change, war, terrorism, civil unrest, and future pandemics; (10) lack of strategic growth opportunities or our failure to execute on available opportunities; (11) our ability to effectively manage problem credits; (12) our ability to successfully develop new products and implement efficiency initiatives on time and with the results projected; (13) our ability to retain executive officers and key employees and their customer and community relationships; (14) regulatory, litigation, and reputational risks and the applicability of insurance coverage; (15) changes in the reliability of our vendors, internal control systems or information systems; (16) the potential impact of climate change; (17) changes in legislation or regulation and accounting principles, policies, and guidelines; (18) reductions in the market value or outflows of wealth management assets under management; and (19) changes in the assumptions used in making such forward-looking statements. Additional factors which could affect the forward-looking statements can be found in the Company's annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K filed with the Securities and Exchange Commission (the "SEC") and available on the SEC's website at http://www.sec.gov. The Company believes the forward-looking statements contained herein are reasonable; however, many of such risks, uncertainties, and other factors are beyond the Company's ability to control or predict and undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. Therefore, the Company can give no assurance that its future results will be as estimated. The Company does not intend to, and disclaims any obligation to, update or revise any forward-looking statement.

NON-GAAP FINANCIAL MEASURES
This document contains certain non-GAAP financial measures in addition to results presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). These non-GAAP measures are intended to provide the reader with additional supplemental perspectives on operating results, performance trends, and financial condition. Non-GAAP financial measures are not a substitute for GAAP measures; they should be read and used in conjunction with the Company's GAAP financial information. Because non-GAAP financial measures presented in this document are not measurements determined in accordance with GAAP and are susceptible to varying calculations, these non-GAAP financial measures, as presented, may not be comparable to other similarly titled measures presented by other companies. A reconciliation of non-GAAP financial measures to GAAP measures is provided below. In all cases, it should be understood that non-GAAP measures do not depict amounts that accrue directly to the benefit of shareholders. An item which management excludes when computing non-GAAP core earnings can be of substantial importance to the Company's results for any particular quarter or year. Each non-GAAP measure used by the Company in this report as supplemental financial data should be considered in conjunction with the Company's GAAP financial information.

The Company utilizes the non-GAAP measure of core earnings in evaluating operating trends, including components for core revenue and expense. These measures exclude amounts which the Company views as unrelated to its normalized operations, including gains/losses on securities, premises, equipment and other real estate owned, acquisition costs, restructuring costs, legal settlements, and systems conversion costs. Non-GAAP adjustments are presented net of an adjustment for income tax expense.

The Company also calculates core earnings per share based on its measure of core earnings. The Company views these amounts as important to understanding its operating trends, particularly due to the impact of accounting standards related to acquisition activity. Analysts also rely on these measures in estimating and evaluating the Company's performance. Management also believes that the computation of non-GAAP core earnings and core earnings per share may facilitate the comparison of the Company to other companies in the financial services industry. The Company also adjusts certain equity related measures to exclude intangible assets due to the importance of these measures to the investment community.

###

CONTACTS

Josephine Iannelli; EVP, Chief Financial Officer & Treasurer; (207) 288-3314

TABLE

INDEX

CONSOLIDATED FINANCIAL SCHEDULES (UNAUDITED)

A

Selected Financial Highlights

B

Balance Sheets

C

Loan and Deposit Analysis

D

Statements of Income

E

Statements of Income (Five Quarter Trend)

F

Average Yields and Costs

G

Average Balances

H

Asset Quality Analysis

I-J

Reconciliation of Non-GAAP Financial Measures (Five Quarter Trend) and Supplementary Data

BAR HARBOR BANKSHARES
SELECTED FINANCIAL HIGHLIGHTS - UNAUDITED

At or for the Quarters Ended

Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

2024

2024

2023

2023

2023

PER SHARE DATA

Net earnings, diluted

$

0.67

$

0.66

$

0.65

$

0.73

$

0.71

Core earnings, diluted (1)

0.66

0.66

0.68

0.73

0.71

Total book value

28.81

28.64

28.48

26.67

27.12

Tangible book value (1)

20.68

20.48

20.28

18.45

18.88

Market price at period end

26.88

26.48

29.36

23.63

24.64

Dividends

0.30

0.28

0.28

0.28

0.28

PERFORMANCE RATIOS (2)

Return on assets

1.04

%

1.03

%

1.00

%

1.11

%

1.10

%

Core return on assets (1)

1.02

1.03

1.04

1.11

1.09

Pre-tax, pre-provision return on assets

1.36

1.32

1.34

1.49

1.47

Core pre-tax, pre-provision return on assets (1)

1.33

1.32

1.39

1.49

1.46

Return on equity

9.46

9.31

9.43

10.72

10.49

Core return on equity (1)

9.25

9.32

9.82

10.72

10.42

Return on tangible equity

13.44

13.25

13.65

15.65

15.28

Core return on tangible equity (1)

13.15

13.26

14.21

15.65

15.19

Net interest margin, fully taxable equivalent (1) (3)

3.09

3.14

3.17

3.18

3.22

Efficiency ratio (1)

62.96

62.91

61.38

58.59

60.25


FINANCIAL DATA (In millions)

Total assets

$

4,034

$

3,959

$

3,971

$

3,984

$

4,029

Total earning assets (4)

3,726

3,663

3,664

3,687

3,716

Total investments

528

538

547

524

556

Total loans

3,064

3,012

2,999

2,993

3,007

Allowance for credit losses

29

28

28

28

27

Total goodwill and intangible assets

124

124

124

125

125

Total deposits

3,140

3,127

3,141

3,140

3,090

Total shareholders' equity

439

436

432

404

411

Net income

10

10

10

11

11

Core earnings (1)

10

10

10

11

11


ASSET QUALITY AND CONDITION RATIOS

Net charge-offs (recoveries)(5)/average loans

0.01

%

0.01

%

0.07

%

-

%

-

%

Allowance for credit losses/total loans

0.94

0.94

0.94

0.94

0.91

Loans/deposits

98

96

95

95

97

Shareholders' equity to total assets

10.88

11.01

10.88

10.15

10.20

Tangible shareholders' equity to tangible assets

8.06

8.13

8.00

7.25

7.32

____________________________________

(1) Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in tables I-J for additional information.
(2) All performance ratios are based on average balance sheet amounts, where applicable.
(3) Fully taxable equivalent considers the impact of tax-advantaged investment securities and loans.
(4) Earning assets includes non-accruing loans and interest-bearing deposits with other banks. Securities are valued at amortized cost.
(5) Current quarter annualized.

A

BAR HARBOR BANKSHARES
CONSOLIDATED BALANCE SHEETS - UNAUDITED


Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

(in thousands)

2024

2024

2023

2023

2023

Assets

Cash and due from banks

$

39,673

$

30,770

$

42,221

$

41,210

$

46,532

Interest-earning deposits with other banks

62,163

45,449

52,621

81,606

77,253

Total cash and cash equivalents

101,836

76,219

94,842

122,816

123,785


Securities available for sale

512,928

527,603

534,574

509,453

538,178

Federal Home Loan Bank stock

14,755

9,960

12,788

14,834

17,784

Total securities

527,683

537,563

547,362

524,287

555,962


Loans held for sale

3,897

3,137

2,189

2,016

3,669


Total loans

3,064,181

3,011,672

2,999,049

2,992,791

3,007,480

Less: Allowance for credit losses

(28,855

)

(28,355

)

(28,142

)

(28,011

)

(27,362

)

Net loans

3,035,326

2,983,317

2,970,907

2,964,780

2,980,118


Premises and equipment, net

51,628

47,849

48,287

47,790

47,412

Other real estate owned

-

-

-

-

-

Goodwill

119,477

119,477

119,477

119,477

119,477

Other intangible assets

4,404

4,637

4,869

5,102

5,335

Cash surrender value of bank-owned life insurance

81,221

80,642

80,037

79,469

78,967

Deferred tax asset, net

24,750

23,849

22,979

28,328

24,181

Other assets

83,978

82,285

79,936

89,876

89,641

Total assets

$

4,034,200

$

3,958,975

$

3,970,885

$

3,983,941

$

4,028,547


Liabilities and shareholders' equity

Non-interest bearing demand

$

553,067

$

544,495

$

569,714

$

618,421

$

602,667

Interest-bearing demand

882,068

888,591

946,978

929,481

911,488

Savings

544,980

551,493

553,963

572,271

588,769

Money market

359,208

365,289

370,242

361,839

351,762

Time

801,143

777,208

700,260

658,482

635,559

Total deposits

3,140,466

3,127,076

3,141,157

3,140,494

3,090,245


Senior borrowings

329,349

269,437

271,044

307,070

398,972

Subordinated borrowings

60,541

60,501

60,461

60,422

60,371

Total borrowings

389,890

329,938

331,505

367,492

459,343


Other liabilities

64,937

66,247

66,164

71,747

68,243

Total liabilities

3,595,293

3,523,261

3,538,826

3,579,733

3,617,831


Total shareholders' equity

438,907

435,714

432,059

404,208

410,716

Total liabilities and shareholders' equity

$

4,034,200

$

3,958,975

$

3,970,885

$

3,983,941

$

4,028,547


Net shares outstanding

15,232

15,212

15,172

15,156

15,144

B

BAR HARBOR BANKSHARES
CONSOLIDATED LOAN & DEPOSIT ANALYSIS - UNAUDITED

LOAN ANALYSIS

Annualized

Growth %

Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Quarter

Year

(in thousands)

2024

2024

2023

2023

2023

to Date

to Date

Commercial real estate

$

1,634,658

$

1,574,802

$

1,552,061

$

1,548,835

$

1,551,748

15

%

11

%

Commercial and industrial

421,297

412,567

400,169

391,347

388,430

8

11

Total commercial loans

2,055,955

1,987,369

1,952,230

1,940,182

1,940,178

14

11


Residential real estate

854,718

873,213

889,904

896,757

907,741

(8

)

(7

)

Consumer

99,776

95,838

97,001

95,160

96,947

16

6

Tax exempt and other

53,732

55,252

59,914

60,692

62,614

(11

)

(21

)

Total loans

$

3,064,181

$

3,011,672

$

2,999,049

$

2,992,791

$

3,007,480

7

%

4

%

DEPOSIT ANALYSIS

Annualized

Growth %

Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Quarter

Year

(in thousands)

2024

2024

2023

2023

2023

to Date

to Date

Non-interest bearing demand

$

553,067

$

544,495

$

569,714

$

618,421

$

602,667

6

%

(6

)%

Interest-bearing demand

882,068

888,591

946,978

929,481

911,488

(3

)

(14

)

Savings

544,980

551,493

553,963

572,271

588,769

(5

)

(3

)

Money market

359,208

365,289

370,242

361,839

351,762

(7

)

(6

)

Total non-maturity deposits

2,339,323

2,349,868

2,440,897

2,482,012

2,454,686

(2

)

(8

)

Time

801,143

777,208

700,260

658,482

635,559

12

29

Total deposits

$

3,140,466

$

3,127,076

$

3,141,157

$

3,140,494

$

3,090,245

2

%

-

%

C

BAR HARBOR BANKSHARES
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

Three Months Ended

Six Months Ended

June 30,

June 30,

(in thousands, except per share data)

2024

2023

2024

2023

Interest and dividend income

Loans

$

40,634

$

36,917

$

80,104

$

71,477

Securities and other

6,204

5,964

12,557

11,755

Total interest and dividend income

46,838

42,881

92,661

83,232

Interest expense

Deposits

14,780

8,590

29,312

13,855

Borrowings

4,299

5,501

7,535

9,681

Total interest expense

19,079

14,091

36,847

23,536

Net interest income

27,759

28,790

55,814

59,696

Provision for credit losses

585

750

874

1,548

Net interest income after provision for credit losses

27,174

28,040

54,940

58,148

Non-interest income

Trust and investment management fee income

4,193

3,805

7,863

7,360

Customer service fees

3,737

3,774

7,447

7,451

Gain on sales of securities, net

50

-

50

34

Mortgage banking income

558

378

815

657

Bank-owned life insurance income

583

503

1,144

1,651

Customer derivative income

168

83

168

215

Other income

344

437

732

796

Total non-interest income

9,633

8,980

18,219

18,164

Non-interest expense

Salaries and employee benefits

13,860

13,223

27,108

25,994

Occupancy and equipment

4,382

4,392

8,855

8,806

Gain on sales of premises and equipment, net

(248

)

(86

)

(263

)

(99

)

Outside services

462

424

800

780

Professional services

238

355

638

781

Communication

192

175

381

337

Marketing

521

476

1,088

885

Amortization of intangible assets

233

233

466

466

Acquisition, conversion and other expenses

-

-

20

20

Provision for unfunded commitments

-

45

(185

)

(130

)

Other expenses

4,378

4,155

8,798

8,256

Total non-interest expense

24,018

23,392

47,706

46,096

Income before income taxes

12,789

13,628

25,453

30,216

Income tax expense

2,532

2,837

5,101

6,413

Net income

$

10,257

$

10,791

$

20,352

$

23,803


Earnings per share:

Basic

$

0.67

$

0.71

$

1.34

$

1.57

Diluted

0.67

0.71

1.33

1.57


Weighted average shares outstanding:

Basic

15,227

15,139

15,213

15,125

Diluted

15,275

15,180

15,273

15,186

D

BAR HARBOR BANKSHARES
CONSOLIDATED STATEMENTS OF INCOME (5 Quarter Trend) - UNAUDITED

Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

(in thousands, except per share data)

2024

2024

2023

2023

2023

Interest and dividend income

Loans

$

40,634

$

39,470

$

39,531

$

38,412

$

36,917

Securities and other

6,204

6,353

6,284

6,723

5,964

Total interest and dividend income

46,838

45,823

45,815

45,135

42,881

Interest expense

Deposits

14,780

14,532

12,962

11,415

8,590

Borrowings

4,299

3,236

4,060

4,534

5,501

Total interest expense

19,079

17,768

17,022

15,949

14,091

Net interest income

27,759

28,055

28,793

29,186

28,790

Provision for credit losses

585

289

687

673

750

Net interest income after provision for credit losses

27,174

27,766

28,106

28,513

28,040

Non-interest income

Trust and investment management fee income

4,193

3,670

3,401

3,522

3,805

Customer service fees

3,737

3,710

3,791

3,926

3,774

Gain on sales of securities, net

50

-

-

-

-

Mortgage banking income

558

257

515

415

378

Bank-owned life insurance income

583

561

533

515

503

Customer derivative income

168

-

151

43

83

Other income

344

388

459

394

437

Total non-interest income

9,633

8,586

8,850

8,815

8,980

Non-interest expense

Salaries and employee benefits

13,860

13,248

13,511

13,011

13,223

Occupancy and equipment

4,382

4,473

4,309

4,469

4,392

(Gain) loss on sales of premises and equipment, net

(248

)

(15

)

281

-

(86

)

Outside services

462

338

515

376

424

Professional services

238

400

369

436

355

Communication

192

189

190

170

175

Marketing

521

567

485

326

476

Amortization of intangible assets

233

233

233

233

233

Acquisition, conversion and other expenses

-

20

263

-

-

Provision for unfunded commitments

-

(185

)

-

45

45

Other expenses

4,378

4,420

4,211

3,950

4,155

Total non-interest expense

24,018

23,688

24,367

23,016

23,392

Income before income taxes

12,789

12,664

12,589

14,312

13,628

Income tax expense

2,532

2,569

2,644

3,208

2,837

Net income

$

10,257

$

10,095

$

9,945

$

11,104

$

10,791


Earnings per share:

Basic

$

0.67

$

0.66

$

0.66

$

0.73

$

0.71

Diluted

0.67

0.66

0.65

0.73

0.71


Weighted average shares outstanding:

Basic

15,227

15,198

15,164

15,155

15,139

Diluted

15,275

15,270

15,221

15,196

15,180

E

BAR HARBOR BANKSHARES
AVERAGE YIELDS AND COSTS (Fully Taxable Equivalent (Non-GAAP) - Annualized) - UNAUDITED

Quarters Ended

Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

2024

2024

2023

2023

2023

Earning assets

Interest-earning deposits with other banks

5.65

%

5.88

%

6.42

%

5.02

%

5.59

%

Securities available for sale and FHLB stock

4.00

4.02

3.85

3.87

3.71

Loans:

Commercial real estate

5.61

5.47

5.46

5.34

5.21

Commercial and industrial

6.76

6.68

6.66

6.56

6.42

Residential real estate

4.13

4.09

3.94

3.84

3.76

Consumer

7.26

7.22

7.14

6.88

6.67

Total loans

5.41

5.31

5.24

5.11

4.99

Total earning assets

5.18

%

5.10

%

5.02

%

4.90

%

4.77

%


Funding liabilities

Deposits:

Interest-bearing demand

1.39

%

1.34

%

1.33

%

1.11

%

0.94

%

Savings

0.65

0.63

0.48

0.42

0.37

Money market

2.93

3.07

2.80

2.55

2.52

Time

4.33

4.18

3.93

3.65

2.82

Total interest-bearing deposits

2.35

2.26

2.05

1.81

1.45

Borrowings

4.57

4.35

4.64

4.59

4.73

Total interest-bearing liabilities

2.64

%

2.48

%

2.37

%

2.19

%

1.99

%


Net interest spread

2.54

2.62

2.65

2.71

2.78

Net interest margin, fully taxable equivalent(1)

3.09

3.14

3.17

3.18

3.22

(1) Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in tables I-J for additional information.

F

BAR HARBOR BANKSHARES
AVERAGE BALANCES - UNAUDITED


Quarters Ended


Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

(in thousands)

2024

2024

2023

2023

2023

Assets

Interest-earning deposits with other banks (1)

$

27,407

$

36,608

$

36,794

$

70,499

$

21,440

Securities available for sale and FHLB stock (2)

607,868

604,658

608,793

620,851

636,088

Loans:

Commercial real estate

1,600,253

1,558,506

1,554,961

1,550,188

1,536,035

Commercial and industrial

468,052

464,762

457,642

439,915

434,384

Residential real estate

865,412

884,767

898,147

909,296

911,788

Consumer

97,371

96,163

95,193

96,362

97,518

Total loans (3)

3,031,088

3,004,198

3,005,943

2,995,761

2,979,725

Total earning assets

3,666,363

3,645,464

3,651,530

3,687,111

3,637,253

Cash and due from banks

30,809

29,900

34,741

36,713

32,067

Allowance for credit losses

(28,567

)

(28,122

)

(28,057

)

(27,473

)

(26,932

)

Goodwill and other intangible assets

123,994

124,225

124,459

124,926

124,926

Other assets

167,150

166,538

157,159

162,801

163,388

Total assets

$

3,959,749

$

3,938,005

$

3,939,832

$

3,984,078

$

3,930,702


Liabilities and shareholders' equity

Deposits:

Interest-bearing demand

$

858,657

$

899,349

$

916,314

$

915,072

$

885,091

Savings

542,950

552,231

552,932

579,090

602,724

Money market

355,731

390,720

365,142

358,742

423,013

Time

775,932

738,683

670,628

645,285

468,188

Total interest-bearing deposits

2,533,270

2,580,983

2,505,016

2,498,189

2,379,016

Borrowings

378,121

298,918

347,459

391,976

466,402

Total interest-bearing liabilities

2,911,391

2,879,901

2,852,475

2,890,165

2,845,418

Non-interest-bearing demand deposits

546,448

554,816

604,638

610,644

608,180

Other liabilities

65,712

67,327

64,092

72,409

64,346

Total liabilities

3,523,551

3,502,044

3,521,205

3,573,218

3,517,944

Total shareholders' equity

436,198

435,961

418,627

410,860

412,758

Total liabilities and shareholders' equity

$

3,959,749

$

3,938,005

$

3,939,832

$

3,984,078

$

3,930,702

__________________________________

(1) Total average interest-bearing deposits with other banks is net of Federal Reserve daily cash letter.
(2) Average balances for securities available-for-sale are based on amortized cost.
(3) Total average loans include non-accruing loans and loans held for sale.

G

BAR HARBOR BANKSHARES
AVERAGE BALANCES - UNAUDITED

At or for the Quarters Ended

Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

(in thousands)

2024

2024

2023

2023

2023

NON-PERFORMING ASSETS

Non-accruing loans:

Commercial real estate

$

551

$

578

$

610

$

867

$

909

Commercial and industrial

1,301

1,152

363

1,595

1,814

Residential real estate

3,511

4,169

3,742

3,673

3,415

Consumer

914

971

813

635

565

Total non-accruing loans

6,277

6,870

5,528

6,770

6,703

Other real estate owned

-

-

-

-

-

Total non-performing assets

$

6,277

$

6,870

$

5,528

$

6,770

$

6,703


Total non-accruing loans/total loans

0.20

%

0.23

%

0.18

%

0.23

%

0.22

%

Total non-performing assets/total assets

0.16

0.17

0.14

0.17

0.17


PROVISION AND ALLOWANCE FOR CREDIT LOSSES

Balance at beginning of period

$

28,355

$

28,142

$

28,011

$

27,362

$

26,607

Charged-off loans

(106

)

(113

)

(632

)

(74

)

(199

)

Recoveries on charged-off loans

21

37

76

50

204

Net loans (charged-off) recovered

(85

)

(76

)

(556

)

(24

)

5

Provision for credit losses

585

289

687

673

750

Balance at end of period

$

28,855

$

28,355

$

28,142

$

28,011

$

27,362


Allowance for credit losses/total loans

0.94

%

0.94

%

0.94

%

0.94

%

0.91

%

Allowance for credit losses/non-accruing loans

460

413

509

414

408


NET LOAN (CHARGE-OFFS) RECOVERIES

Commercial real estate

$

-

$

(3

)

$

-

$

-

$

(72

)

Commercial and industrial

(2

)

(64

)

(479

)

34

139

Residential real estate

3

5

3

13

3

Consumer

(86

)

(14

)

(80

)

(71

)

(65

)

Total, net

$

(85

)

$

(76

)

$

(556

)

$

(24

)

$

5


Net charge-offs (recoveries) (QTD annualized)/average loans

0.01

%

0.01

%

0.07

%

-

%

-

%

Net charge-offs (recoveries) (YTD annualized)/average loans

0.01

0.01

0.02

0.01

-


DELINQUENT AND NON-ACCRUING LOANS/ TOTAL LOANS

30-89 Days delinquent

0.10

%

0.14

%

0.11

%

0.13

%

0.09

%

90+ Days delinquent and still accruing

-

-

0.01

0.03

0.02

Total accruing delinquent loans

0.10

0.14

0.12

0.16

0.11

Non-accruing loans

0.20

0.23

0.18

0.23

0.22

Total delinquent and non-accruing loans

0.30

%

0.37

%

0.30

%

0.39

%

0.33

%

H

BAR HARBOR BANKSHARES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA - UNAUDITED

At or for the Quarters Ended

Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

(in thousands)

2024

2024

2023

2023

2023

Net income

$

10,257

$

10,095

$

9,945

$

11,104

$

10,791

Non-core items:

Gain on sale of securities, net

(50

)

-

-

-

-

(Gain) loss on sale of premises and equipment, net

(248

)

(15

)

281

-

(86

)

Acquisition, conversion and other expenses

-

20

263

-

-

Income tax expense (1)

71

(1

)

(131

)

-

20

Total non-core items

(227

)

4

413

-

(66

)

Core earnings (2)
(A)

$

10,030

$

10,099

$

10,358

$

11,104

$

10,725


Net interest income
(B)

$

27,759

$

28,055

$

28,793

$

29,186

$

28,790

Non-interest income

9,633

8,586

8,850

8,815

8,980

Total revenue

37,392

36,641

37,643

38,001

37,770

Gain on sale of securities, net

(50

)

-

-

-

-

Total core revenue (2)
(C)

$

37,342

$

36,641

$

37,643

$

38,001

$

37,770


Total non-interest expense

24,018

23,688

24,367

23,016

23,392

Non-core expenses:

Gain (loss) on sale of premises and equipment, net

248

15

(281

)

-

86

Acquisition, conversion and other expenses

-

(20

)

(263

)

-

-

Total non-core expenses

248

(5

)

(544

)

-

86

Core non-interest expense (2)
(D)

$

24,266

$

23,683

$

23,823

$

23,016

$

23,478


Total revenue

37,392

36,641

37,643

38,001

37,770

Total non-interest expense

24,018

23,688

24,367

23,016

23,392

Pre-tax, pre-provision net revenue

$

13,374

$

12,953

$

13,276

$

14,985

$

14,378


Core revenue(2)

37,342

36,641

37,643

38,001

37,770

Core non-interest expense(2)

24,266

23,683

23,823

23,016

23,478

Core pre-tax, pre-provision net revenue(2)
(U)

$

13,076

$

12,958

$

13,820

$

14,985

$

14,292


(in millions)

Average earning assets
(E)

$

3,666

$

3,645

$

3,652

$

3,687

$

3,637

Average assets
(F)

3,960

3,938

3,940

3,984

3,931

Average shareholders' equity
(G)

436

436

419

411

413

Average tangible shareholders' equity (2) (3)
(H)

312

312

294

286

288

Tangible shareholders' equity, period-end (2) (3)
(I)

315

312

308

280

286

Tangible assets, period-end (2) (3)
(J)

3,910

3,835

3,847

3,859

3,904


I

BAR HARBOR BANKSHARES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA - UNAUDITED

At or for the Quarters Ended

Jun 30,

Mar 31,

Dec 31,

Sep 30,

Jun 30,

(in thousands)

2024

2024

2023

2023

2023

Common shares outstanding, period-end

(K)

15,232

15,212

15,172

15,156

15,144

Average diluted shares outstanding

(L)

15,275

15,270

15,221

15,196

15,180



Core earnings per share, diluted (2)

(A/L)

$

0.66

$

0.66

$

0.68

$

0.73

$

0.71

Tangible book value per share, period-end (2)

(I/K)

20.68

20.48

20.28

18.45

18.88

Securities adjustment, net of tax (1) (4)

(M)

(52,313

)

(49,633

)

(47,649

)

(66,530

)

(55,307

)

Tangible book value per share, excluding securities adjustment (2) (4)

(I+M)/K

24.12

23.75

23.42

22.84

22.53

Tangible shareholders' equity/total tangible assets (2)

(I/J)

8.06

8.13

8.00

7.25

7.32


Performance ratios (5)

GAAP return on assets

1.04

%

1.03

%

1.00

%

1.11

%

1.10

%

Core return on assets (2)

(A/F)

1.02

1.03

1.04

1.11

1.09

Pre-tax, pre-provision return on assets

1.36

1.32

1.34

1.49

1.47

Core pre-tax, pre-provision return on assets (2)

(U/F)

1.33

1.32

1.39

1.49

1.46

GAAP return on equity

9.46

9.31

9.43

10.72

10.49

Core return on equity (2)

(A/G)

9.25

9.32

9.82

10.72

10.42

Return on tangible equity

13.44

13.25

13.65

15.65

15.28

Core return on tangible equity (1) (2)

(A+Q)/H

13.15

13.26

14.21

15.65

15.19

Efficiency ratio (2) (6)

(D-O-Q)/(C+N)

62.96

62.91

61.38

58.59

60.25

Net interest margin, fully taxable equivalent (2)

(B+P)/E

3.09

3.14

3.17

3.18

3.22


Supplementary data (in thousands)

Taxable equivalent adjustment for efficiency ratio

(N)

$

528

$

523

$

561

$

565

$

539

Franchise taxes included in non-interest expense

(O)

191

70

141

186

163

Tax equivalent adjustment for net interest margin

(P)

389

388

395

405

382

Intangible amortization

(Q)

233

233

233

233

233

______________________________

(1) Assumes a marginal tax rate of 23.82% in the second quarter 2024, 24.01% in the first quarter 2024 and the fourth quarter 2023, and 23.80% in the first three quarters of 2023.
(2) Non-GAAP financial measure.
(3) Tangible shareholders' equity is computed by taking total shareholders' equity less the intangible assets at period-end. Tangible assets is computed by taking total assets less the intangible assets at period-end.
(4) Securities adjustment, net of tax represents the total unrealized loss on available-for-sale securities recorded on the Company's consolidated balance sheets within total common shareholders' equity.
(5) All performance ratios are based on average balance sheet amounts, where applicable.
(6) Efficiency ratio is computed by dividing core non-interest expense net of franchise taxes and intangible amortization divided by core revenue on a fully taxable equivalent basis.

SOURCE: Bar Harbor Bank & Trust



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