Bridgehampton National Bank Grows Its Business In The Second Quarter

Bridgehampton National Bank
Bridgehampton National Bank

The following information was sent to me via Bridgehampton National Bank. It was not surprising to see that nearly every key number at the bank was growing.

Bridge Bancorp, Inc. (Nasdaq:BDGE), the parent company of The Bridgehampton National Bank (BNB), announced second quarter results for 2013. Highlights of the Company’s quarterly financial results include:

Net income of $3.3 million and $.36 per share, a 6% increase in net income over 2012

Returns on average assets and equity of .79% and 10.74%, respectively.

Net interest income of $12.3 million, an increase of $.5 million over 2012, with a net interest margin of 3.23%.

Total assets of $1.73 billion at June 2013, 23% higher than June 2012.

Loans exceeded $900 million, with growth of $222 million or 33%, compared to June 2012.    

Deposits of $1.46 billion, an 18% increase compared to the second quarter of 2012.

Continued solid asset quality metrics and reserve coverage.

Tier 1 Capital increased by $15.3 million or 12% from June 2012.

Declared quarterly dividend of $.23 per share in July 2013.

“During the second quarter of 2013, we continue to realize benefits from our strategic initiatives: strong growth in loans and core deposits with increased net interest income and net income. Our increased scale offsets the lower net interest margins associated with the increasingly challenging interest rate environment,” commented Kevin M. O’Connor, President and CEO, Bridge Bancorp, Inc. 

Net Earnings and Returns

Net income for the quarter ended June 2013 was $3.3 million or $.36 per share, compared to $3.1 million or $.36 per share, for the same period in 2012. The increase in net income reflects earning assets growth, as we experienced higher net interest income and lower credit costs, offsetting decreases in other income and increases in operating expenses.

Average earning assets increased by 17% or $222.8 million, compared to the second quarter of 2012, driven by strong deposit expansion, funding higher loan demand.  This growth in earning assets offset the decline in the net interest margin to 3.23% from 3.63% in the 2012 second quarter. The margin has compressed, as low market interest rates impacted assets more than liabilities. The net interest margin decreased slightly, from 3.29% in the first quarter of 2013. The provision for loan losses was $0.6 million for the quarter, $1.9 million lower than the comparable 2012 quarter, reflecting an improving economy and continuing stable asset quality trends.

“In June 2012, we believed it prudent to protect against developing negative macroeconomic trends. Since then, we have seen continued improvement in the domestic economy driven by job creation and rising home values along with gains in global stock markets. These factors, coupled with a stronger local economy, have resulted in lower credit costs and improved our outlook. We do, however, continue to carefully monitor economic trends as the recovery remains tenuous,” commented Mr. O’Connor.

Non interest income decreased $1.3 million primarily due to the reduction in securities gains of $1.4 million compared to June 2012, partially offset by higher fee income.  Non interest expense for the quarter increased $0.8 million compared to June 2012, reflecting investments in new facilities, including three new branches, enhancements to technology and additional staffing.  Although expenses have increased in 2013, the Company’s ratio of operating expenses to average assets decreased to 2.26% from 2.43% in the second quarter of 2012.

“Non interest income reflects the net effect of ongoing repositioning within our investment portfolio, while fee income grew with our expanded deposit base. The higher expenses are principally related to growth and improving service initiatives, as well as increases in regulatory and compliance costs,” noted Mr. O’Connor.

Balance Sheet and Asset Quality

Total assets at quarter end were $1.73 billion, $326.4 million or 23% higher than June 2012 and $103.9 million or 6% above December 2012. These increases reflect strong organic growth, over June 2012 levels, as loans increased $222.4 million or 33%, while investment securities increased $118.6 million or 19%. During 2013 loan growth has exceeded $102 million, while securities have remained virtually unchanged. Earning asset growth continues to be funded principally by deposits, which increased $224.6 million or 18% to $1.46 billion at June 2013. Demand deposits totaled $472.9 million at June 2013, $105.2 million or 29% higher than June 2012. The change in demand deposits compared to December 2012 reflects a seasonal decline of approximately $80 million in municipal deposits.

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