• Net Income: $20.1 million.
• Earnings Per Share (EPS): $0.23.
• Loan Growth: $34 million increase.
• Customer Deposits: $103 million increase.
• Net Interest Margin: Increased 7 basis points to 307 basis points.
• Net Interest Income: $83 million, up $3 million from Q2.
• Non-Interest Income: $6.3 million, flat with the prior quarter.
• Operating Expenses: $57.9 million, down from $59.2 million in Q2.
• Provision for Credit Losses: $4.7 million, a decrease of $900,000 from Q2.
• Net Charge Offs: $3.8 million or 16 basis points on loans, annualized.
• Non-Performing Loans: Increased by $10.5 million.
• Dividend: Maintained at 13.5 cents per share, yielding approximately 5.1% annually.

• Warning! GuruFocus has detected 8 Warning Signs with BRKL.

Release Date: October 24, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Brookline Bancorp Inc (NASDAQ:BRKL) reported a net income of $20.1 million for the third quarter of 2024, with earnings per share of 23 cents.
• Customer deposits increased by $103 million, indicating strong customer trust and engagement.
• The net interest margin improved by 7 basis points to 307 basis points, with expectations for continued improvement through 2025.
• Operating expenses decreased to $57.9 million from $59.2 million in the previous quarter, reflecting cost management efforts.
• The board approved maintaining a quarterly dividend of 13.5 cents per share, providing a yield of approximately 5.1%.

Negative Points

• Non-performing loans increased by $10.5 million due to issues with a specific Eastern Funding relationship.
• The equipment finance and commercial real estate portfolios declined during the quarter.
• Net charge-offs were $3.8 million, with a significant portion related to specialty vehicles.
• The provision for credit losses was $4.7 million, although this was a decrease from the previous quarter.
• The company is not yet at profitability with its Clarendon Private business, which remains in a growth phase.

Q & A Highlights

Q: Could you clarify your comments on the equipment finance loan that went non-accrual this quarter? A: That was one large loan at Eastern Funding, financing two grocery stores. We have a sizable specific reserve set up for that loan, about $5 million this quarter. Carl Carlson, Co-President, CFO, and Strategy Officer

Q: What was the spot margin in September? A: The spot margin was 313 basis points. Carl Carlson, Co-President, CFO, and Strategy Officer

Q: Can you provide an update on the loan pipelines and their current complexion? A: We are seeing more institutional type loans, especially in Greater Boston, Rhode Island, and Westchester County. Equipment finance is picking up slightly, and we expect a 4-5% gain in the loan portfolio in 2025. Paul Perrault, Chairman and CEO

Q: How is Clarendon Private performing, and are you at profitability yet? A: We are not at profitability yet. We have around $350 million in assets under management, with most customers coming from the bank. Carl Carlson, Co-President, CFO, and Strategy Officer

Q: Can you discuss your thoughts on stock buybacks below book value? A: We are cautious about buybacks given the current interest rate environment and credit conditions. However, as the market improves, this will be a more active discussion with the board. Carl Carlson, Co-President, CFO, and Strategy Officer

For the complete transcript of the earnings call, please refer to the full earnings call transcript.