Bryn Mawr Bank Corporation Reports Record Quarterly Earnings of $15.3 Million in First Full Quarter with Royal Bank, Driven by $7.1 Million Increase in Net Interest Income and Strong Noninterest Revenues, Declares $0.22 Dividend

BRYN MAWR, Pa., April 19, 2018 (GLOBE NEWSWIRE) -- Bryn Mawr Bank Corporation (NASDAQ:BMTC) (the “Corporation”), parent of The Bryn Mawr Trust Company (the “Bank”) today reported net income of $15.3 million, or $0.75 diluted earnings per share for the three months ended March 31, 2018, as compared to a net loss of $6.2 million, or $(0.35) diluted loss per share, for the three months ended December 31, 2017, and $9.0 million, or $0.53 diluted earnings per share, for the three months ended March 31, 2017.

On a non-GAAP basis, core net income, which excludes due diligence and merger-related expenses, income tax charges related to re-measurement of net deferred tax assets, and certain other non-core income and expense items, as detailed in the appendix to this earnings release, was $19.3 million, or $0.94 diluted earnings per share, for the three months ended March 31, 2018, as compared to $11.3 million, or $0.63 diluted earnings per share, for the three months ended December 31, 2017, and $9.4 million, or $0.55 diluted earnings per share, for the three months ended March 31, 2017. Management believes the core net income measure is important in evaluating the Corporation’s performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

“We are pleased with the solid results posted in the first quarter. Our merger with Royal Bank, which closed at the end of 2017, has already begun to have a significant impact on our bottom line,” stated Frank Leto, President and Chief Executive Officer. “We successfully completed the combination of our banking systems in late February, and with all branch locations now operating under the BMT banner, we are able to offer an expanded range of financial solutions to clients from both institutions,” continued Mr. Leto.

“The strong results we witnessed this quarter included increases in net interest income, wealth management fees, insurance revenues and other operating income, along with the reduced income tax burden as a result of the Tax Cuts and Jobs Act,” added Mr. Leto, continuing, “We are excited about the savings and additional capital that the Tax Reform legislation has and will continue to create.  We intend to put some of these benefits to work through investments in our businesses, team members, and the communities we serve.  We are actively evaluating investments to further our private banking strategy, enhance our systems to improve client experience and advance the development of our operating platform, all with the goal of increasing shareholder value by positioning ourselves for future growth and performance.”

The Board of Directors of the Corporation declared a quarterly dividend of $0.22 per share, payable June 1, 2018 to shareholders of record as of May 1, 2018.

SIGNIFICANT ITEMS OF NOTE
Results of Operations – First Quarter 2018 Compared to Fourth Quarter 2017

• Net income for the three months ended March 31, 2018 was $15.3 million, as compared to a net loss of $6.2 million for the three months ended December 31, 2017. The primary cause of the net loss in the fourth quarter of 2017 was the $15.2 million income tax charge related to the re-measurement of net deferred tax assets as a result of the Tax Cuts and Jobs Act (“Tax Reform”). Aside from the decrease in income tax expense, net interest income for the three months ended March 31, 2018 increased by $7.1 million, as the loans and leases acquired in the Royal Bank merger contributed to the $8.4 million increase in interest on loans and leases. In addition to the increase in net interest income, fees for wealth management services, commissions and fees from our insurance division, net gain on sale of other real estate owned and other operating income increased by $334 thousand, $183 thousand, $268 thousand and $2.8 million, respectively, for the three months ended March 31, 2018, as compared to the three months ended December 31, 2017.
  
  On a non-GAAP basis, core net income, which excludes the above Tax Reform-related income tax charges, due diligence and merger-related expenses and other non-core income and expense items, as detailed in the appendix to this earnings release, was $19.3 million, or $0.94 per diluted share for the three months ended March 31, 2018, as compared to $11.3 million or $0.63 per diluted share for the fourth quarter of 2017.  Management believes the core net income measure is important in evaluating the Corporation’s performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

• Net interest income for the first quarter of 2018 increased $7.1 million, or 23.5%, over the linked-quarter ended December 31, 2017. Average interest-earning assets increased $515.5 million, primarily as a result of the loans and leases acquired from Royal Bank. Average loans and leases increased $486.0 million between the fourth quarter of 2017 and the first quarter of 2018. The increase in interest-earning assets was accompanied by a $457.6 million increase in interest-bearing liabilities, which was also largely the result of interest-bearing deposits and junior subordinated debentures acquired from Royal Bank and the $70 million of subordinated notes issued in December 2017.
   
• Tax-equivalent net interest income for the three months ended March 31, 2018 was $37.5 million, an increase of $7.0 million over the linked quarter, driven by the assets and liabilities acquired from Royal Bank as well as a $2.7 million increase in the accretion of purchase accounting fair value marks between the quarters.
  
  Tax-equivalent interest and fees on loans and leases for the three months ended March 31, 2018 increased $8.4 million over the linked quarter.  Average loans and leases for the three months ended March 31, 2018 increased $486.0 million over the previous quarter and experienced a 44 basis point increase in tax-equivalent yield.
  
  Average available for sale investment securities increased by $31.2 million over the linked quarter, and experienced a 12 basis point tax-equivalent yield increase. The increase in volume and yield on available for sale investment securities resulted in a $254 thousand increase in tax-equivalent interest income for the first quarter of 2018 as compared to the fourth quarter of 2017.  The majority of the investment portfolio acquired from Royal Bank was sold immediately following the close of the merger and did not impact interest income from available for sale investment securities.
  
  Interest expense on deposits for the three months ended March 31, 2018 increased $733 thousand over the linked quarter.  Average interest-bearing deposits increased $404.3 million accompanied by a five basis point increase in the rate paid on deposits.  The increase in average interest-bearing deposits was largely related to the deposits acquired from Royal Bank.
  
  Average subordinated notes for the three months ended March 31, 2018 increased $54.6 million over the linked quarter with the rate paid increasing by two basis points to 4.71%.  The increase was primarily related to the $70 million of 4.25% fixed-to-floating subordinated notes issued on December 13, 2017.  Average junior subordinated debentures for the three months ended March 31, 2018 increased $21.4 million over the linked quarter as the Corporation acquired $21.4 million of floating rate junior subordinated debentures currently at an effective rate of 5.45% from the Royal Bank merger. The volume increase in both borrowing types resulted in an increase in interest expense on subordinated notes and junior subordinated debentures of $625 thousand and $242 thousand, respectively, on a linked-quarter basis.

• The tax-equivalent net interest margin was 3.94% for the first quarter of 2018 as compared to 3.62% for the fourth quarter of 2017.  Adjusting for the impact of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest margin was 3.62% and 3.58% for the first quarter of 2018 and fourth quarter of 2017, respectively, an increase of four basis points. 
   
• Noninterest income for the three months ended March 31, 2018 of $19.5 million increased $4.0 million from the fourth quarter of 2017. Items contributing to the increase included a $2.8 million increase in other operating income comprised primarily of a $2.3 million recovery of the purchase accounting fair value mark that had been recorded on a purchased credit impaired loan acquired from Royal Bank, which paid off, in full, during the first quarter of 2018. A $334 thousand increase in fees for wealth management services, a $183 thousand increase in insurance revenue and a $268 thousand increase in net gain on sale of other real estate owned were also recorded during the quarter.
   
• Noninterest expense for the three months ended March 31, 2018 increased $5.0 million, to $36.0 million, as compared to $31.0 million for the fourth quarter of 2017. The increase on a linked-quarter basis was related to increases of $2.4 million in salaries and wages, $991 thousand in employee benefits and $402 thousand in occupancy and bank premises, all of which were directly related to the staff and facilities additions from the Royal Bank merger. In addition, due diligence, merger-related and merger integration expenses increased $812 thousand on a linked-quarter basis. While much of the merger-related expenses associated with the Royal Bank merger were recorded at the time of the merger, certain expenses incurred in connection with the banking system conversion, contract terminations and lease terminations are recorded as they are incurred.
   
• For the three months ended March 31, 2018, net loan and lease charge-offs totaled $893 thousand, as compared to $556 thousand for the fourth quarter of 2017. The provision for loan and lease losses (the “Provision”) for the three months ended March 31, 2018 was $1.0 million, a $47 thousand decrease from $1.1 million for the fourth quarter of 2017. The credit quality of the loan and lease portfolio remains stable, with the increase in the allowance for loan and lease losses (the “Allowance”) largely related to the organic growth of the portfolio. Nonperforming loans as of March 31, 2018 totaled $7.5 million, a decrease of $1.0 million from December 31, 2017.
   
• Income tax expense for the first quarter of 2018 decreased $15.3 million as compared to the fourth quarter of 2017. Included in tax expense for both the fourth quarter of 2017 and the first quarter of 2018 were discrete tax charges of $15.2 million and $590 thousand, respectively, related to the re-measurement of net deferred tax assets as a result of Tax Reform. Excluding these discrete income tax charges related to Tax Reform, the effective tax rate for the first quarter of 2018 was 20.3% as compared to 34.5% for the fourth quarter of 2017.

Results of Operations – First Quarter 2018 Compared to First Quarter 2017

• Net income for the three months ended March 31, 2018 was $15.3 million, or $0.75 diluted earnings per share, as compared to $9.0 million, or diluted earnings per share of $0.53 for the same period in 2017. Contributing to the $6.2 million increase in net income was a $10.0 million increase in net interest income and increases of $1.0 million, $930 thousand, $666 thousand and $3.2 million in fees for wealth management services, insurance commissions, capital markets revenue and other operating income, respectively. These increases were partially offset by increases of $3.5 million, $1.2 million and $524 thousand in salaries and wages, employee benefits and occupancy and bank premises expenses, respectively. These cost increases were primarily related to the addition of the Royal Bank staff and branch infrastructure and, to a lesser extent, the addition of Hirshorn Boothby in May 2017 and the establishment of our Capital Markets group in the second quarter of 2017. Also contributing to the net income increase was the reduction in our effective income tax rate as a result of Tax Reform, which decreased from 33.9% for the three months ended March 31, 2017 to 23.3% for the same period in 2018. Included in the rate for the first quarter of 2018 was the effect of a discrete tax charge related to the re-measurement of net deferred tax assets, associated with Tax Reform. Excluding this discrete item, the effective rate for the first quarter of 2018 was 20.3%.
  
  On a non-GAAP basis, core net income, which excludes the above Tax Reform-related income tax charges, due diligence and merger-related expenses and other non-core income and expense items, as detailed in the appendix to this earnings release, was $19.3 million, or $0.94 per diluted share for the three months ended March 31, 2018 as compared to $9.4 million, or $0.55 per diluted share for the same period in 2017.  Management believes the core net income measure is important in evaluating the Corporation’s performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

• Tax-equivalent net interest income for the three months ended March 31, 2018 was $37.5 million, an increase of $9.9 million over the same period in 2017.  Contributing to the increase was a $2.3 million increase in the accretion of purchase accounting fair value marks between the first quarters of 2018 and 2017. 
  
  Tax-equivalent interest and fees on loans and leases increased $12.1 million for the three months ended March 31, 2018 as compared to the same period in 2017.  Average loans and leases for the first quarter of 2018 increased $735.5 million from the same period in 2017 and experienced a 48 basis point increase in tax-equivalent yield.  Excluding the effect of the accretion of purchase accounting fair value marks on loans and leases, the adjusted tax-equivalent yield on loans and leases increased by 27 basis points between the first quarters of 2017 and 2018. The increases in short-term rates during 2017 and 2018 contributed to the increase in tax-equivalent yield on loans. The increase in average loans and leases for the first quarter of 2018 as compared to the same period in 2017 was related to the loans and leases acquired in the Royal Bank merger which initially increased loans and leases by $567.3 million, as well as organic loan growth during the period.
  
  Average available for sale investment securities increased by $133.5 million for the three months ended March 31, 2018 as compared to the same period in 2017, and experienced a 26 basis point tax-equivalent yield increase. The increase in volume and yield on available for sale investment securities resulted in a $958 thousand increase in tax-equivalent interest income on available for sale investment securities for the first quarter of 2018 as compared to the same period in 2017.
  
  Partially offsetting the effect on interest income associated with the increase in average loans and leases and available for sale investment securities was a $1.6 million increase in interest expense on deposits for the first quarter of 2018 as compared to the same period in 2017. Average interest-bearing deposits increased by $583.3 million, and was accompanied by an 18 basis point increase in rate paid between the first quarters of 2018 and 2017. The increase in average interest-bearing deposits between the first quarters of 2018 and 2017 was largely related to the interest-bearing deposits assumed in the Royal Bank merger, which initially totaled $494.8 million.
  
  In addition to the increased interest expense on deposits, a $467 thousand increase in interest expense on long- and short-term borrowings between the periods was attributed to a $66.3 million increase in average long- and short-term borrowings coupled with a 153 basis point increase in rate paid on long- and short-term borrowings for the three months ended March 31, 2018 as compared to the same period in 2017.
  
  Average subordinated notes for the three months ended March 31, 2018 increased $68.9 million as compared to the same period in 2017 with the rate paid decreasing by 37 basis points to 4.71% for the three months ended March 31, 2018.  The volume increase in subordinated notes was the result of the December 13, 2017 issuance of $70 million ten-year, 4.25% fixed-to-floating subordinated notes. Average junior subordinated debentures for the three months ended March 31, 2018 increased $21.4 million compared to the same period in 2017 as the Corporation acquired $21.4 million of floating rate junior subordinated debentures, currently at a 5.45% rate, from the Royal Bank merger.  The volume increase in both sub debt types and rate decrease in the subordinated notes in the first quarter of 2018 resulted in an increase in interest expense on subordinated notes and junior subordinated debentures of $773 thousand and a $288 thousand, respectively, for the three months ended March 31, 2018 as compared to the same period in 2017.

• The tax-equivalent net interest margin was 3.94% for the three months ended March 31, 2018 as compared to 3.74% for the same period in 2017.  Adjusting for the impact of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest margin was 3.62% and 3.63% for three months ended March 31, 2018 and 2017, respectively.
   
• Noninterest income for the three months ended March 31, 2018 increased by $6.3 million, to $19.5 million, from the same period in 2017. Increases of $1.0 million, $930 thousand, $666 thousand, and $3.2 million in fees for wealth management services, insurance commissions, capital markets revenues and other operating income, respectively, were recorded. The increase in fees for wealth management services was related to the $1.42 billion increase in wealth assets under management, administration, supervision and brokerage between March 31, 2017 and March 31, 2018. The increase in insurance commissions was primarily related to the May 2017 acquisition of Hirshorn Boothby which expanded our insurance division into the City of Philadelphia. Our Capital Markets group, which began operations in the second quarter of 2017, contributed significantly to our noninterest income totals. The $3.2 million increase in other operating income was primarily related to a $2.3 million recovery of a purchase accounting fair value mark resulting from the pay off, in full, of a purchased credit impaired loan acquired in the Royal Bank merger.
   
• Noninterest expense for the three months ended March 31, 2018 increased $9.4 million, to $36.0 million, from the same period in 2017. A majority of the increase was related to the additional expenses associated with the staff and facilities assumed in the Royal Bank merger. In addition, the May 2017 acquisition of Hirshorn Boothby and the formation of our Capital Markets group in the second quarter of 2017 contributed to the increase in noninterest expense. Due diligence, merger-related and merger integration expenses also experienced an increase of $3.8 million between the quarters, primarily related to the Royal Bank merger. 
   
• For the three months ended March 31, 2018, the Provision was $1.0 million, which was an increase of $739 thousand from the same period in 2017. Net charge-offs for the first quarter of 2018 were $893 thousand as compared to $670 thousand for the same period in 2017.

Financial Condition – March 31, 2018 Compared to December 31, 2017

• Total portfolio loans and leases of $3.31 billion as of March 31, 2018 increased by $19.9 million from December 31, 2017, an annualized increase rate of 2.4%. Increases of $18.1 million, $10.3 million, $7.9 million and $6.0 million in commercial mortgages, consumer loans, commercial and industrial loans and leases, respectively, were offset by decreases of $10.3 million, $6.8 million and $5.2 million in construction loans, home equity loans and lines and residential mortgages, respectively, between the dates.
   
• The Allowance as of March 31, 2018 was $17.6 million, or 0.53% of portfolio loans and leases, as compared to $17.5 million, or 0.53% of portfolio loans and leases as of December 31, 2017. In addition to the ratio of Allowance to portfolio loans and leases, management also calculates two non-GAAP measures: the Allowance as a percentage of originated loans and leases, which was 0.69% as of March 31, 2018, as compared to 0.70% as of December 31, 2017, and the Allowance plus the remaining loan mark as a percentage of gross loans, which was 1.50% as of March 31, 2018, as compared to 1.58% as of December 31, 2017. A reconciliation of these and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.
   
• Available for sale investment securities as of March 31, 2018 totaled $534.1 million, a decrease of $155.1 million from December 31, 2017. The decrease in available for sale investment securities was primarily related to the maturing, in January 2018, of $200.0 million of short-term U.S. Treasury securities.
   
• Total assets as of March 31, 2018 were $4.30 billion, a decrease of $149.3 million from December 31, 2017. The decrease in available for sale investment securities described in the previous bullet point accounted for the majority of the decrease.
   
• Wealth assets under management, administration, supervision and brokerage totaled $13.15 billion as of March 31, 2018, an increase of $178.2 million from December 31, 2017. The increase in wealth assets was comprised of a $191.5 million decrease in account balances whose fees are based on market value, and a $369.7 million increase in fixed rate flat-fee account types.
   
• Deposits of $3.32 billion as of March 31, 2018 decreased $58.3 million from December 31, 2017. Decreases of $61.7 million and $29.6 million in noninterest-bearing and savings accounts, respectively, were partially offset by a $48.1 million increase in interest-bearing demand accounts.
   
• Borrowings of $401.4 million as of March 31, 2018, which include short-term borrowings, long-term FHLB advances, subordinated notes and junior subordinated debentures, decreased $95.4 million from December 31, 2017. The decrease was comprised of a $64.1 million decrease in short-term borrowings, and a $31.4 million decrease in long-term FHLB advances.
  
  
• The capital ratios for the Bank and the Corporation, as of March 31, 2018, as shown in the attached tables, indicate levels above the regulatory minimum to be considered “well capitalized.” Excluding the Bank’s and Corporation’s Tier I leverage ratio, all regulatory capital ratios increased from their December 31, 2017 levels primarily as a result of the increase in retained earnings. The Tier I leverage ratio, which is the ratio of Tier I capital to average quarterly assets, for both the Bank and Corporation decreased from December 31, 2017, as the assets acquired in the Royal Bank merger were present for a full quarter.

FORWARD LOOKING STATEMENTS AND SAFE HARBOR
This press release contains statements which, to the extent that they are not recitations of historical fact may constitute forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Such forward-looking statements may include financial and other projections as well as statements regarding the Corporation’s future plans, objectives, performance, revenues, growth, profits, operating expenses or the Corporation’s underlying assumptions. The words “may,” “would,” “should,” “could,” “will,” “likely,” “possibly,” “expect,” “anticipate,” “intend,” “indicate,” “estimate,” “target,” “potentially,” “promising,” “probably,” “outlook,” “predict,” “contemplate,” “continue,” “plan,” “forecast,” “project,” “are optimistic,” “are looking,” “are looking forward” and “believe” or other similar words and phrases may identify forward-looking statements. Persons reading this press release are cautioned that such statements are only predictions, and that the Corporation’s actual future results or performance may be materially different.

Such forward-looking statements involve known and unknown risks and uncertainties.   A number of factors, many of which are beyond the Corporation's control, could cause our actual results, events or developments, or industry results, to be materially different from any future results, events or developments expressed, implied or anticipated by such forward-looking statements, and so our business and financial condition and results of operations could be materially and adversely affected. Such factors include, among others, our inability to successfully integrate acquired businesses, the possibility that integration may take longer than anticipated or be more costly to complete and that the anticipated benefits, including any anticipated cost savings or strategic gains may be significantly harder to achieve or take longer than anticipated or may not be achieved, our need for capital, our ability to control operating costs and expenses, and to manage loan and lease delinquency rates; the credit risks of lending activities and overall quality of the composition of our loan, lease and securities portfolio; the impact of economic conditions, consumer and business spending habits, and real estate market conditions on our business and in our market area; changes in the levels of general interest rates, deposit interest rates, or net interest margin and funding sources; changes in banking regulations and policies and the possibility that any banking agency approvals we might require for certain activities will not be obtained in a timely manner or at all or will be conditioned in a manner that would impair our ability to implement our business plans; changes in accounting policies and practices; the inability of key third-party providers to perform their obligations to us; our ability to attract and retain key personnel; competition in our marketplace; war or terrorist activities; material differences in the actual financial results, cost savings and revenue enhancements associated with our acquisitions; and other factors as described in our securities filings.  All forward-looking statements and information set forth herein are based on management’s current beliefs and assumptions as of the date hereof and speak only as of the date they are made.  The Corporation does not undertake to update forward-looking statements.

For a complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K, as updated by our quarterly or other reports subsequently filed with the SEC.

Bryn Mawr Bank Corporation
Summary Financial Information (unaudited)
(dollars in thousands, except per share data)
	As of or For the Three Months Ended
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
Consolidated Balance Sheet (selected items)
Interest-bearing deposits with banks	$	24,589			$	48,367			$	36,870			$	30,806			$	69,978
Investment securities		550,199				701,744				482,399				452,869				400,360
Loans held for sale		5,522				3,794				6,327				8,590				3,015
Portfolio loans and leases		3,305,795				3,285,858				2,677,345				2,666,651				2,555,589
Allowance for loan and lease losses ("ALLL")		(17,662	)			(17,525	)			(17,004	)			(16,399	)			(17,107	)
Goodwill and other intangible assets		207,287				205,855				128,534				129,211				124,629
Total assets		4,300,376				4,449,720				3,476,821				3,438,219				3,292,617
Deposits - interest-bearing		2,452,421				2,448,954				1,923,567				1,863,288				1,865,009
Deposits - non-interest-bearing		863,118				924,844				760,614				818,475				771,556
Short-term borrowings		173,704				237,865				180,874				130,295				23,613
Long-term FHLB advances and other borrowings		107,784				139,140				134,651				164,681				174,711
Subordinated notes		98,448				98,416				29,573				29,559				29,546
Jr. subordinated debentures		21,456				21,416				-				-				-
Total liabilities		3,767,315				3,921,601				3,074,929				3,043,242				2,904,522
Total shareholders' equity		533,061				528,119				401,892				394,977				388,095
Average Balance Sheet (selected items)
Interest-bearing deposits with banks	$	38,044			$	43,962			$	26,628			$	26,266			$	39,669
Investment securities		535,471				499,968				462,700				429,400				393,306
Loans held for sale		2,848				3,966				3,728				3,855				4,238
Portfolio loans and leases		3,288,364				2,801,289				2,676,589				2,611,755				2,551,439
Total interest-earning assets		3,864,727				3,349,185				3,169,645				3,071,276				2,988,652
Goodwill and intangible assets		205,529				142,652				128,917				126,537				124,884
Total assets		4,246,180				3,640,667				3,441,906				3,333,307				3,244,060
Deposits - interest-bearing		2,435,491				2,031,170				1,871,494				1,853,660				1,852,194
Short-term borrowings		172,534				180,650				182,845				98,869				47,603
Long-term FHLB advances		123,920				134,605				155,918				171,567				182,507
Subordinated notes		98,430				43,844				29,564				29,550				29,537
Jr. subordinated debentures		21,430				3,957
Total interest-bearing liabilities		2,851,805				2,394,226				2,239,821				2,153,646				2,111,841
Total liabilities		3,719,746				3,213,349				3,044,549				2,943,591				2,861,846
Total shareholders' equity		526,434				427,318				397,357				389,716				382,214
Income Statement
Net interest income	$	37,439			$	30,321			$	29,438			$	27,965			$	27,403
Provision for loan and lease losses		1,030				1,077				1,333				(83	)			291
Noninterest income		19,536				15,536				15,584				14,785				13,227
Noninterest expense		36,030				31,056				28,184				28,495				26,660
Income tax expense		4,630				19,924				4,766				4,905				4,635
Net income		15,285				(6,200	)			10,739				9,433				9,044
Add: Net loss attributable to noncontrolling interest		1				-				-				-				-
Net income attributable to Bryn Mawr Bank Corporation		15,286				(6,200	)			10,739				9,433				9,044
Basic earnings per share		0.76				(0.35	)			0.63				0.56				0.53
Diluted earnings per share		0.75				(0.35	)			0.62				0.55				0.53
Net income (core) (1)		19,282				11,255				11,245				10,236				9,375
Basic earnings per share (core) (1)		0.95				0.64				0.66				0.60				0.55
Diluted earnings per share (core) (1)		0.94				0.63				0.65				0.59				0.55
Cash dividends paid per share		0.22				0.22				0.22				0.21				0.21
Profitability Indicators
Return on average assets		1.46	%			-0.68	%			1.24	%			1.14	%			1.13	%
Return on average equity		11.78	%			-5.75	%			10.72	%			9.71	%			9.60	%
Return on tangible equity(1)		20.20	%			-8.03	%			16.52	%			15.06	%			14.96	%
Return on tangible equity (core)(1)		25.25	%			16.30	%			17.27	%			16.28	%			15.48	%
Return on average assets (core)(1)		1.84	%			1.23	%			1.30	%			1.23	%			1.17	%
Return on average equity (core)(1)		14.85	%			10.45	%			11.23	%			10.53	%			9.95	%
Tax-equivalent net interest margin		3.94	%			3.62	%			3.71	%			3.68	%			3.74	%
Efficiency ratio(1)		54.12	%			58.64	%			59.30	%			62.16	%			62.66	%
Share Data
Closing share price	$	43.95			$	44.20			$	43.80			$	42.50			$	39.50
Book value per common share	$	26.35			$	26.19			$	23.57			$	23.25			$	22.87
Tangible book value per common share	$	16.10			$	15.98			$	16.03			$	15.64			$	15.53
Price / book value		166.79	%			168.74	%			185.82	%			182.81	%			172.71	%
Price / tangible book value		272.92	%			276.52	%			273.19	%			271.69	%			254.41	%
Weighted average diluted shares outstanding		20,425,256				17,613,634				17,253,982				17,232,767				17,182,689
Shares outstanding, end of period		20,229,896				20,161,395				17,050,151				16,989,849				16,969,451
Wealth Management Information:
Wealth assets under mgmt, administration, supervision and brokerage (2)	$	13,146,926			$	12,968,738			$	12,431,370			$	12,050,555			$	11,725,460
Fees for wealth management services	$	10,308			$	9,974			$	9,651			$	9,807			$	9,303
Capital Ratios
Bryn Mawr Trust Company
Tier I capital to risk weighted assets ("RWA") (3)		11.33	%			11.10	%			10.78	%			10.29	%			10.58	%
Total  capital to RWA (3)		11.85	%			11.65	%			11.42	%			10.90	%			11.25	%
Tier I leverage ratio (3)		9.39	%			10.76	%			8.79	%			8.76	%			8.83	%
Tangible equity ratio (1)(3)		9.19	%			8.67	%			8.46	%			8.24	%			8.46	%
Common equity Tier I capital to RWA (3)		11.33	%			11.10	%			10.78	%			10.29	%			10.58	%
Bryn Mawr Bank Corporation
Tier I capital to RWA (3)		10.66	%			10.42	%			10.50	%			10.10	%			10.50	%
Total capital to RWA (3)		14.17	%			13.92	%			12.23	%			11.79	%			12.30	%
Tier I leverage ratio (3)		8.71	%			10.10	%			8.53	%			8.63	%			8.77	%
Tangible equity ratio (1)(3)		7.98	%			7.61	%			8.16	%			8.03	%			8.32	%
Common equity Tier I capital to RWA (3)		10.03	%			9.87	%			10.50	%			10.10	%			10.50	%
Asset Quality Indicators
Net loan and lease charge-offs ("NCO"s)	$	893			$	556			$	728			$	625			$	670
Nonperforming loans and leases ("NPL"s)	$	7,533			$	8,579			$	4,472			$	7,237			$	7,329
Other real estate owned ("OREO")		300				304				865				1,122				978
Total nonperforming assets ("NPA"s)	$	7,833			$	8,883			$	5,337			$	8,359			$	8,307
Nonperforming loans and leases 30 or more days past due	$	5,775			$	6,983			$	2,337			$	4,076			$	5,097
Performing loans and leases 30 to 89 days past due		6,547				7,958				4,558				6,258				6,077
Performing loans and leases 90 or more days past due		-				-				-				-				-
Total delinquent loans and leases	$	12,322			$	14,941			$	6,895			$	10,334			$	11,174
Delinquent loans and leases to total loans and leases		0.37	%			0.45	%			0.26	%			0.39	%			0.44	%
Delinquent performing loans and leases to total loans and leases		0.20	%			0.24	%			0.17	%			0.23	%			0.24	%
NCOs / average loans and leases (annualized)		0.11	%			0.08	%			0.11	%			0.10	%			0.11	%
NPLs / total portfolio loans and leases		0.23	%			0.26	%			0.17	%			0.27	%			0.29	%
NPAs / total loans and leases and OREO		0.24	%			0.27	%			0.20	%			0.31	%			0.32	%
NPAs / total assets		0.18	%			0.20	%			0.15	%			0.24	%			0.25	%
ALLL / NPLs		234.46	%			204.28	%			380.23	%			226.60	%			233.42	%
ALLL / portfolio loans		0.53	%			0.53	%			0.64	%			0.61	%			0.67	%
ALLL on originated loans and leases / Originated loans and leases (1)		0.69	%			0.70	%			0.70	%			0.68	%			0.75	%
(Total Allowance + Loan mark) / Total Gross portfolio loans and leases (1)		1.50	%			1.58	%			1.01	%			1.03	%			1.12	%
Troubled debt restructurings ("TDR"s) included in NPLs	$	1,125			$	3,289			$	2,033			$	2,470			$	2,681
TDRs in compliance with modified terms		5,235				5,800				6,597				6,148				6,492
Total TDRs	$	6,360			$	9,089			$	8,630			$	8,618			$	9,173
(1)Non-GAAP measure - see Appendix for Non-GAAP to GAAP reconciliation.
(2)Brokerage assets represent assets held at a registered broker dealer under a clearing agreement.
(3)Capital Ratios for the current quarter are to be considered preliminary until the Call Reports are filed.

 

Bryn Mawr Bank Corporation
Detailed Balance Sheets (unaudited)
(dollars in thousands)
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
Assets
Cash and due from banks	$	7,804			$	11,657			$	8,682			$	19,352			$	17,457
Interest-bearing deposits with banks		24,589				48,367				36,870				30,806				69,978
Cash and cash equivalents		32,393				60,024				45,552				50,158				87,435
Investment securities, available for sale		534,103				689,202				471,721				443,687				391,028
Investment securities, held to maturity		7,885				7,932				6,255				5,161				5,194
Investment securities, trading		8,211				4,610				4,423				4,021				4,138
Loans held for sale		5,522				3,794				6,327				8,590				3,015
Portfolio loans and leases, originated		2,564,825				2,487,296				2,433,054				2,409,964				2,286,814
Portfolio loans and leases, acquired		740,970				798,562				244,291				256,687				268,775
Total portfolio loans and leases		3,305,795				3,285,858				2,677,345				2,666,651				2,555,589
Less: Allowance for losses on originated loan and leases		(17,570	)			(17,475	)			(16,957	)			(16,374	)			(17,069	)
Less: Allowance for losses on acquired loan and leases		(92	)			(50	)			(47	)			(25	)			(38	)
Total allowance for loan and lease losses		(17,662	)			(17,525	)			(17,004	)			(16,399	)			(17,107	)
Net portfolio loans and leases		3,288,133				3,268,333				2,660,341				2,650,252				2,538,482
Premises and equipment		54,986				54,458				44,544				44,446				40,515
Accrued interest receivable		12,521				14,246				9,287				8,717				8,392
Mortgage servicing rights		5,706				5,861				5,732				5,683				5,686
Bank owned life insurance		56,946				56,667				39,881				39,680				39,479
Federal Home Loan Bank ("FHLB") stock		15,499				20,083				16,248				15,168				8,505
Goodwill		182,200				179,889				107,127				107,127				104,765
Intangible assets		25,087				25,966				21,407				22,084				19,864
Other investments		11,720				12,470				8,941				8,682				8,716
Other assets		59,464				46,185				29,035				24,763				27,403
Total assets	$	4,300,376			$	4,449,720			$	3,476,821			$	3,438,219			$	3,292,617
Liabilities
Deposits
Noninterest-bearing	$	863,118			$	924,844			$	760,614			$	818,475			$	771,556
Interest-bearing		2,452,421				2,448,954				1,923,567				1,863,288				1,865,009
Total deposits		3,315,539				3,373,798				2,684,181				2,681,763				2,636,565
Short-term borrowings		173,704				237,865				180,874				130,295				23,613
Long-term FHLB advances		107,784				139,140				134,651				164,681				174,711
Subordinated notes		98,448				98,416				29,573				29,559				29,546
Jr. subordinated debentures		21,456				21,416				-				-				-
Accrued interest payable		4,814				3,527				2,267				2,830				2,722
Other liabilities		45,570				47,439				43,383				34,114				37,365
Total liabilities		3,767,315				3,921,601				3,074,929				3,043,242				2,904,522
Shareholders' equity
Common stock		24,439				24,360				21,248				21,162				21,141
Paid-in capital in excess of par value		371,319				371,486				235,412				234,654				233,910
Less: common stock held in treasury, at cost		(68,787	)			(68,179	)			(68,134	)			(67,091	)			(66,969	)
Accumulated other comprehensive (loss) income, net of tax		(9,664	)			(4,414	)			(1,400	)			(1,564	)			(1,990	)
Retained earnings		216,438				205,549				214,766				207,816				202,003
Total Bryn Mawr Bank Corporation shareholders' equity		533,745				528,802				401,892				394,977				388,095
Noncontrolling interest		(684	)			(683	)			-				-				-
Total shareholders' equity		533,061				528,119				401,892				394,977				388,095
Total liabilities and shareholders' equity	$	4,300,376			$	4,449,720			$	3,476,821			$	3,438,219			$	3,292,617

 

Bryn Mawr Bank Corporation
Supplemental Balance Sheet Information (unaudited)
(dollars in thousands)
	Portfolio Loans and Leases as of
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
Commercial mortgages	$	1,541,457			$	1,523,376			$	1,224,571			$	1,197,936			$	1,137,870
Home equity loans and lines		211,469				218,275				206,974				208,480				203,962
Residential mortgages		453,655				458,886				422,524				416,488				418,264
Construction		202,168				212,454				133,505				156,581				145,699
Total real estate loans		2,408,749				2,412,991				1,987,574				1,979,485				1,905,795
Commercial & Industrial		727,231				719,312				597,595				599,203				567,917
Consumer		48,423				38,153				31,306				28,485				23,932
Leases		121,392				115,401				60,870				59,478				57,945
Total non-real estate loans and leases		897,046				872,866				689,771				687,166				649,794
Total portfolio loans and leases	$	3,305,795			$	3,285,857			$	2,677,345			$	2,666,651			$	2,555,589
	Nonperforming Loans and Leases as of
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
Commercial mortgages	$	138			$	872			$	193			$	818			$	315
Home equity loans and lines		1,949				1,481				613				1,535				1,828
Residential mortgages		2,603				4,417				1,589				2,589				2,640
Construction		-				-				-				-				-
Total nonperforming real estate loans		4,690				6,770				2,395				4,942				4,783
Commercial & Industrial		2,499				1,706				1,977				2,112				2,471
Consumer		-				-				-				10				-
Leases		344				103				100				173				75
Total nonperforming non-real estate loans and leases		2,843				1,809				2,077				2,295				2,546
Total nonperforming portfolio loans and leases	$	7,533			$	8,579			$	4,472			$	7,237			$	7,329
	Net Loan and Lease Charge-Offs (Recoveries) for the Three Months Ended
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
Commercial mortgage	$	(3	)		$	51			$	(3	)		$	(3	)		$	(3	)
Home equity loans and lines		25				(5	)			69				169				438
Residential		-				88				3				43				27
Construction		(1	)			(1	)			(1	)			(1	)			(1	)
Total net charge-offs of real estate loans		21				133				68				208				461
Commercial & Industrial		283				125				298				185				59
Consumer		48				55				36				16				39
Leases		541				243				326				216				111
Total net charge-offs of non-real estate loans and leases		872				423				660				417				209
Total net charge-offs	$	893			$	556			$	728			$	625			$	670

 

Bryn Mawr Bank Corporation
Supplemental Balance Sheet Information (unaudited)
(dollars in thousands)
	Investment Securities Available for Sale, at Fair Value
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
U.S. Treasury securities	$	100			$	200,088			$	100			$	100			$	100
Obligations of the U.S. Government and agencies		175,107				151,044				142,711				126,468				100,476
State & political subdivisions - tax-free		19,746				21,138				23,556				26,958				30,416
State & political subdivisions - taxable		171				172				524				524				524
Mortgage-backed securities		303,902				274,990				260,680				230,617				197,420
Collateralized mortgage obligations		33,980				36,662				39,595				42,549				45,476
Other debt securities		1,097				1,599				1,100				1,099				1,299
Bond mutual funds		-				-				-				11,956				11,920
Other investments		-				3,509				3,455				3,416				3,397
Total investment securities available for sale, at fair value	$	534,103			$	689,202			$	471,721			$	443,687			$	391,028
	Unrealized Gain (Loss) on Investment Securities Available for Sale
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
U.S. Treasury securities	$	-			$	11			$	-			$	-			$	-
Obligations of the U.S. Government and agencies		(3,756	)			(1,984	)			(920	)			(699	)			(803	)
State & political subdivisions - tax-free		(74	)			(42	)			23				11				(10	)
State & political subdivisions - taxable		(1	)			-				1				1				1
Mortgage-backed securities		(5,169	)			(968	)			869				480				196
Collateralized mortgage obligations		(1,322	)			(934	)			(640	)			(662	)			(777	)
Other debt securities		(3	)			(1	)			-				(1	)			(1	)
Bond mutual funds		-				-				-				-				(36	)
Other investments		-				296				230				203				132
Total unrealized (losses) gains on investment securities available for sale	$	(10,325	)		$	(3,622	)		$	(437	)		$	(667	)		$	(1,298	)
	Deposits
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
Interest-bearing deposits:
Interest-bearing demand	$	529,478			$	481,336			$	395,383			$	381,345			$	395,131
Money market		856,072				862,639				720,613				729,859				757,071
Savings		308,925				338,572				264,273				254,903				255,791
Retail time deposits		523,138				532,202				316,068				321,982				319,381
Wholesale non-maturity deposits		63,449				62,276				48,620				54,675				69,471
Wholesale time deposits		171,359				171,929				178,610				120,524				68,164
Total interest-bearing deposits		2,452,421				2,448,954				1,923,567				1,863,288				1,865,009
Noninterest-bearing deposits		863,118				924,844				760,614				818,475				771,556
Total deposits	$	3,315,539			$	3,373,798			$	2,684,181			$	2,681,763			$	2,636,565

 

Bryn Mawr Bank Corporation
Detailed Income Statements (unaudited)
(dollars in thousands, except per share data)
	For the Three Months Ended
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
Interest income:
Interest and fees on loans and leases	$	40,689			$	32,245			$	30,892			$	29,143			$	28,482
Interest on cash and cash equivalents		53				37				36				35				66
Interest on investment securities		2,792				2,516				2,270				2,059				1,778
Total interest income		43,534				34,798				33,198				31,237				30,326
Interest expense:
Interest on deposits		3,472				2,739				2,198				1,983				1,828
Interest on short-term borrowings		630				579				547				237				27
Interest on FHLB advances and other borrowings		562				595				645				682				698
Interest on jr. subordinated debentures		288				46				-				-				-
Interest on subordinated notes		1,143				518				370				370				370
Total interest expense		6,095				4,477				3,760				3,272				2,923
Net interest income		37,439				30,321				29,438				27,965				27,403
Provision for loan and lease losses (the "Provision")		1,030				1,077				1,333				(83	)			291
Net interest income after Provision		36,409				29,244				28,105				28,048				27,112
Noninterest income:
Fees for wealth management services		10,308				9,974				9,651				9,807				9,303
Insurance revenue		1,693				1,510				1,373				943				763
Capital markets revenue		666				600				843				953				-
Service charges on deposits		713				655				676				630				647
Loan servicing and other fees		686				536				548				519				503
Net gain on sale of loans		518				493				799				520				629
Net gain on sale of investment securities available for sale		7				28				72				-				1
Net gain (loss) on sale of other real estate owned		176				(92	)			-				(12	)			-
Dividends on FHLB and FRB stocks		431				290				217				218				214
Other operating income		4,338				1,542				1,405				1,207				1,167
Total noninterest income		19,536				15,536				15,584				14,785				13,227
Noninterest expense:
Salaries and wages		15,982				13,619				13,602				13,580				12,450
Employee benefits		3,708				2,717				2,560				2,404				2,489
Occupancy and bank premises		3,050				2,648				2,485				2,247				2,526
Furniture, fixtures and equipment		1,898				1,816				1,726				1,869				1,974
Advertising		461				386				277				405				386
Amortization of intangible assets		879				677				677				687				693
(Recovery) impairment of mortgage servicing rights ("MSRs")		(50	)			(94	)			3				43				3
Due diligence, merger-related and merger integration expenses		4,319				3,507				850				1,236				511
Professional fees		748				769				739				1,049				711
Pennsylvania bank shares tax		473				16				317				297				664
Information technology		1,195				1,006				880				821				874
Other operating expenses		3,367				3,989				4,068				3,857				3,379
Total noninterest expense		36,030				31,056				28,184				28,495				26,660
Income before income taxes		19,915				13,724				15,505				14,338				13,679
Income tax expense		4,630				19,924				4,766				4,905				4,635
Net income	$	15,285			$	(6,200	)		$	10,739			$	9,433			$	9,044
Add: Net loss attributable to noncontrolling interest		1				-				-				-				-
Net income attributable to Bryn Mawr Bank Corporation	$	15,286			$	(6,200	)		$	10,739			$	9,433			$	9,044
Per share data:
Weighted average shares outstanding		20,202,969				17,632,697				17,023,046				16,984,563				16,954,132
Dilutive common shares		222,287				-				230,936				248,204				228,557
Weighted average diluted shares		20,425,256				17,613,634				17,253,982				17,232,767				17,182,689
Basic earnings (loss) per common share	$	0.76			$	(0.35	)		$	0.63			$	0.56			$	0.53
Diluted earnings (loss) per common share	$	0.75			$	(0.35	)		$	0.62			$	0.55			$	0.53
Dividend declared per share	$	0.22			$	0.22			$	0.22			$	0.21			$	0.21
Effective tax rate		23.25	%			145.18	%			30.74	%			34.21	%			33.88	%

 

Bryn Mawr Bank Corporation
Tax-Equivalent Net Interest Margin (unaudited)
(dollars in thousands, except per share data)
		For The Three Months Ended
		March 31, 2018								December 31, 2017								September 30, 2017								June 30, 2017								March 31, 2017
(dollars in thousands)		Average Balance			Interest Income/ Expense			Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense			Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense			Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense			Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense			Average Rates Earned/ Paid
Assets:
Interest-bearing deposits with other banks		$	38,044		$	53		0.56	%	$	43,962		$	37		0.33	%	$	26,628		$	36		0.54	%	$	26,266		$	35		0.53	%	$	39,669		$	66		0.67	%
Investment securities - available for sale:
Taxable			498,718			2,675		2.18	%		465,393			2,394		2.04	%		427,106			2,160		2.01	%		391,112			1,940		1.99	%		354,229			1,653		1.89	%
Tax-exempt			20,501			100		1.98	%		22,640			127		2.23	%		25,268			134		2.10	%		28,970			150		2.08	%		31,485			164		2.11	%
Total investment securities - available for sale			519,219			2,775		2.17	%		488,033			2,521		2.05	%		452,374			2,294		2.01	%		420,082			2,090		2.00	%		385,714			1,817		1.91	%
Investment securities  - held to maturity			7,913			12		0.62	%		7,510			11		0.58	%		6,044			11		0.72	%		5,181			5		0.39	%		3,702			7		0.77	%
Investment securities  - trading			8,339			21		1.02	%		4,425			25		2.24	%		4,282			8		0.74	%		4,137			13		1.26	%		3,890			8		0.83	%
Loans and leases *			3,291,212			40,754		5.02	%		2,805,255			32,403		4.58	%		2,680,317			31,058		4.60	%		2,615,610			29,309		4.49	%		2,555,677			28,622		4.54	%
Total interest-earning assets			3,864,727			43,615		4.58	%		3,349,185			34,997		4.15	%		3,169,645			33,407		4.18	%		3,071,276			31,452		4.11	%		2,988,652			30,520		4.14	%
Cash and due from banks			10,698								6,855								15,709								15,727								14,942
Less: allowance for loan and lease losses			(17,628	)							(17,046	)							(16,564	)							(17,549	)							(17,580	)
Other assets			388,383								301,673								273,116								263,853								258,046
Total assets		$	4,246,180							$	3,640,667							$	3,441,906							$	3,333,307							$	3,244,060
Liabilities:
Interest-bearing deposits:
Savings, NOW and market rate deposits		$	1,676,733		$	1,479		0.36	%	$	1,410,461		$	897		0.25	%	$	1,359,293		$	823		0.24	%	$	1,375,949		$	813		0.24	%	$	1,388,561		$	756		0.22	%
Wholesale deposits			231,289			733		1.29	%		262,643			822		1.24	%		190,849			548		1.14	%		154,424			378		0.98	%		143,461			317		0.90	%
Retail time deposits			527,469			1,260		0.97	%		358,066			1,020		1.13	%		321,352			827		1.02	%		323,287			792		0.98	%		320,172			755		0.96	%
Total interest-bearing deposits			2,435,491			3,472		0.58	%		2,031,170			2,739		0.53	%		1,871,494			2,198		0.47	%		1,853,660			1,983		0.43	%		1,852,194			1,828		0.40	%
Borrowings:
Short-term borrowings			172,534			630		1.48	%		180,650			579		1.27	%		182,845			547		1.19	%		98,869			237		0.96	%		47,603			27		0.23	%
Long-term FHLB advances			123,920			562		1.84	%		134,605			595		1.75	%		155,918			645		1.64	%		171,567			682		1.59	%		182,507			698		1.55	%
Jr. subordinated debt			21,430			288		5.45	%		3,957			46		4.61	%		-			-					-			-					-			-
Subordinated notes			98,430			1,143		4.71	%		43,844			518		4.69	%		29,564			370		4.97	%		29,550			370		5.02	%		29,537			370		5.08	%
Total borrowings			416,314			2,623		2.56	%		363,056			1,738		1.90	%		368,327			1,562		1.68	%		299,986			1,289		1.72	%		259,647			1,095		1.71	%
Total interest-bearing liabilities			2,851,805			6,095		0.87	%		2,394,226			4,477		0.74	%		2,239,821			3,760		0.67	%		2,153,646			3,272		0.61	%		2,111,841			2,923		0.56	%
Noninterest-bearing deposits			835,476								771,519								764,562								755,597								711,794
Other liabilities			32,465								47,604								40,166								34,348								38,211
Total noninterest-bearing liabilities			867,941								819,123								804,728								789,945								750,005
Total liabilities			3,719,746								3,213,349								3,044,549								2,943,591								2,861,846
Shareholders' equity			526,434								427,318								397,357								389,716								382,214
Total liabilities and shareholders' equity		$	4,246,180							$	3,640,667							$	3,441,906							$	3,333,307							$	3,244,060
Net interest spread								3.71	%							3.41	%							3.51	%							3.50	%							3.58	%
Effect of noninterest-bearing sources								0.23	%							0.21	%							0.20	%							0.18	%							0.16	%
Tax-equivalent net interest margin					$	37,520		3.94	%				$	30,520		3.62	%				$	29,647		3.71	%				$	28,180		3.68	%				$	27,597		3.74	%
Tax-equivalent adjustment					$	81		0.01	%				$	199		0.02	%				$	209		0.03	%				$	215		0.03	%				$	194		0.02	%
Supplemental Information Regarding Accretion of Fair Value Marks
		Interest			Increase (Decrease)			Effect on Yield or Rate					Increase (Decrease)			Effect on Yield or Rate					Increase (Decrease)			Effect on Yield or Rate					Increase (Decrease)			Effect on Yield or Rate					Increase (Decrease)			Effect on Yield or Rate
Loans and leases		Income			$	2,702		0.33	%				$	276		0.04	%				$	708		0.10	%				$	402		0.06	%				$	726		0.12	%
Retail time deposits		Expense				(380	)	-0.29	%					(13	)	-0.01	%					(15	)	-0.02	%					(18	)	-0.02	%					(19	)	-0.02	%
Long-term FHLB advances and other borrowings		Expense				15		0.05	%					(31	)	-0.09	%					(30	)	-0.08	%					(30	)	-0.07	%					(30	)	-0.07	%
Jr. subordinated debt		Expense				40		0.76	%					-		0.00	%					-		0.00	%					-		0.00	%					-		0.00	%
Net interest income from fair value marks					$	3,027							$	320							$	753							$	450							$	775
Purchase accounting effect on tax-equivalent margin								0.32	%							0.04	%							0.09	%							0.06	%							0.11	%
* Average loans and leases include portfolio loans and leases, and loans held for sale. Non-accrual loans are also included in the average loan and leases balances.

 

Bryn Mawr Bank Corporation
Appendix - Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Performance Measures (unaudited)
(dollars in thousands, except per share data)
Statement on Non-GAAP Measures: The Corporation believes the presentation of the following non-GAAP financial measures provides useful supplemental information that is essential to an investor’s proper understanding of the results of operations and financial condition of the Corporation. Management uses non-GAAP financial measures in its analysis of the Corporation’s performance. These non-GAAP measures should not be viewed as substitutes for the financial measures determined in accordance with GAAP, nor are they necessarily comparable to  non-GAAP performance measures that may be presented by other companies.
	As of or For the Three Months Ended
	March 31, 2018				December 31, 2017				September 30, 2017				June 30, 2017				March 31, 2017
Reconciliation of Net Income to Net Income (core):
Net income (a GAAP measure)	$	15,286			$	(6,200	)		$	10,739			$	9,433			$	9,044
Less: Tax-effected non-core noninterest income:
(Gain) loss on sale of investment securities available for sale		(6	)			(18	)			(47	)			-				(1	)
Add: Tax-effected non-core noninterest expense items:
Due diligence, merger-related and merger integration  expenses		3,412				2,280				553				803				332
Add: Federal income tax expense related to re-measurement of net deferred tax asset due to tax reform legislation.		590				15,193				-				-				-
Net income (core) (a non-GAAP measure)	$	19,282			$	11,255			$	11,245			$	10,236			$	9,375
Calculation of Basic and Diluted Earnings per Common Share (core):
Weighted average common shares outstanding		20,202,969				17,632,697				17,023,046				16,984,563				16,954,132
Dilutive common shares		222,287				211,975				230,936				248,204				228,557
Weighted average diluted shares		20,425,256				17,844,672				17,253,982				17,232,767				17,182,689
Basic earnings per common share (core) (a non-GAAP measure)	$	0.95			$	0.64			$	0.66			$	0.60			$	0.55
Diluted earnings per common share (core) (a non-GAAP measure)	$	0.94			$	0.63			$	0.65			$	0.59			$	0.55
Calculation of Return on Average Tangible Equity:
Net income (loss)	$	15,286			$	(6,200	)		$	10,739			$	9,433			$	9,044
Add: Tax-effected amortization and impairment of intangible assets		694				440				440				447				450
Net tangible income (numerator)	$	15,980			$	(5,760	)		$	11,179			$	9,880			$	9,494
Average shareholders' equity	$	526,434			$	427,318			$	397,357			$	389,716			$	382,214
Less: Average goodwill and intangible assets		(205,529	)			(142,652	)			(128,917	)			(126,537	)			(124,884	)
Net average tangible equity (denominator)	$	320,905			$	284,666			$	268,440			$	263,179			$	257,330
Return on tangible equity (a non-GAAP measure)		20.20	%			-8.03	%			16.52	%			15.06	%			14.96	%
Calculation of Return on Average Tangible Equity (core):
Net income (core) (a non-GAAP measure)	$	19,282			$	11,255			$	11,245			$	10,236			$	9,375
Add: Tax-effected amortization and impairment of intangible assets		694				440				440				447				450
Net tangible income (core) (numerator)	$	19,976			$	11,695			$	11,685			$	10,683			$	9,825
Average shareholders' equity	$	526,434			$	427,318			$	397,357			$	389,716			$	382,214
Less: Average goodwill and intangible assets		(205,529	)			(142,652	)			(128,917	)			(126,537	)			(124,884	)
Net average tangible equity (denominator)	$	320,905			$	284,666			$	268,440			$	263,179			$	257,330
Return on tangible equity (core) (a non-GAAP measure)		25.25	%			16.30	%			17.27	%			16.28	%			15.48	%
Calculation of Tangible Equity Ratio:
Total shareholders' equity	$	533,061			$	528,119			$	401,892			$	394,977			$	388,095
Less: Goodwill and intangible assets		(207,287	)			(205,855	)			(128,534	)			(129,211	)			(124,629	)
Net tangible equity (numerator)	$	325,774			$	322,264			$	273,358			$	265,766			$	263,466
Total assets	$	4,300,376			$	4,449,720			$	3,476,821			$	3,438,219			$	3,292,617
Less: Goodwill and intangible assets		(207,287	)			(205,855	)			(128,534	)			(129,211	)			(124,629	)
Tangible assets (denominator)	$	4,093,089			$	4,243,865			$	3,348,287			$	3,309,008			$	3,167,988
Tangible equity ratio		7.96	%			7.59	%			8.16	%			8.03	%			8.32	%
Calculation of Return on Average Assets (core)
Return on average assets (GAAP)		1.46	%			-0.68	%			1.18	%			1.09	%			1.10	%
Effect of adjustment to GAAP net income to core net income		0.38	%			1.90	%			0.04	%			0.11	%			0.04	%
Return on average assets (core)		1.84	%			1.23	%			1.23	%			1.19	%			1.14	%
Calculation of Return on Average Equity (core)
Return on average equity (GAAP)		11.78	%			-5.76	%			10.72	%			9.60	%			9.39	%
Effect of adjustment to GAAP net income to core net income		3.08	%			16.21	%			0.51	%			0.93	%			0.56	%
Return on average equity (core)		14.85	%			10.45	%			11.23	%			10.53	%			9.95	%
Calculation of Efficiency Ratio:
Noninterest expense	$	36,030			$	31,056			$	28,184			$	28,495			$	26,660
Less: certain noninterest expense items*:
Amortization of intangibles		(879	)			(677	)			(677	)			(687	)			(693	)
Due diligence, merger-related and merger integration  expenses		(4,319	)			(3,507	)			(850	)			(1,236	)			(511	)
Noninterest expense (adjusted) (numerator)	$	30,832			$	26,872			$	26,657			$	26,572			$	25,456
Noninterest income	$	19,536			$	15,536			$	15,584			$	14,785			$	13,227
Less: non-core noninterest income items:
Loss (gain) on sale of investment securities available for sale		(8	)			(28	)			(72	)			-				(2	)
Noninterest income (core)	$	19,528			$	15,508			$	15,512			$	14,785			$	13,225
Net interest income		37,439				30,321				29,438				27,965				27,403
Noninterest income (core) and net interest income (denominator)	$	56,967			$	45,829			$	44,950			$	42,750			$	40,628
Efficiency ratio		54.12	%			58.64	%			59.30	%			62.16	%			62.66	%
* In calculating the Corporation's efficiency ratio, which is used by Management to identify the cost of generating each dollar of core revenue, certain non-core income and expense items as well as the amortization of intangible assets, are excluded.
Supplemental Loan and Allowance Information Used to Calculate Non-GAAP Measures
Total Allowance	$	17,662			$	17,525			$	17,004			$	16,399			$	17,107
Less: Allowance on acquired loans		92				50				47				25				38
Allowance on originated loans and leases	$	17,570			$	17,475			$	16,957			$	16,374			$	17,069
Total Allowance	$	17,662			$	17,525			$	17,004			$	16,399			$	17,107
Loan mark on acquired loans		32,260				34,790				10,223				11,084				11,544
Total Allowance + Loan mark	$	49,922			$	52,315			$	27,227			$	27,483			$	28,651
Total Portfolio loans and leases	$	3,305,795			$	3,285,858			$	2,677,345			$	2,666,651			$	2,555,589
Less: Originated loans and leases		2,564,825				2,487,296				2,433,054				2,409,964				2,286,814
Net acquired loans	$	740,970			$	798,562			$	244,291			$	256,687			$	268,775
Add: Loan mark on acquired loans		32,260				34,790				10,223				11,084				11,544
Gross acquired loans (excludes loan mark)	$	773,230			$	833,352			$	254,514			$	267,771			$	280,319
Originated loans and leases		2,564,825				2,487,296				2,433,054				2,409,964				2,286,814
Total Gross portfolio loans and leases	$	3,338,055			$	3,320,648			$	2,687,568			$	2,677,735			$	2,567,133

FOR MORE INFORMATION CONTACT:             
Frank Leto, President, CEO
610-581-4730
Mike Harrington, CFO
610-526-2466