HINGHAM INSTITUTION FOR SAVINGS FROM: Robert H. Gaughen, Jr., President
Hingham Institution for Savings Hingham, MA (NASDAQ: HIFS)
DATE: January 17, 2017
CONTACT: Patrick R. Gaughen, Executive Vice President (781) 783-1761
HINGHAM ANNOUNCES 21% INCREASE IN ANNUAL EARNINGS AND 15.59% RETURN ON EQUITYHINGHAM INSTITUTION FOR SAVINGS (NASDAQ: HIFS), Hingham, Massachusetts
announced earnings for the fourth quarter and the year ended December 31, 2016.
Net income for the year ended December 31, 2016 was $23,423,000 or $10.99 per share basic and $10.89 per share diluted as compared to $19,346,000 or $9.09 per share basic and $9.02 per share diluted for the year ended December 31, 2015. Net income per share (basic and diluted) for 2016 increased 21% over the same period in 2015. The Bank's return on average equity for the year ended December 31, 2016 was 15.59% and the return on average assets was 1.22%, as compared to 14.81% and 1.18% for the same period in 2015.
Net income for the quarter ended December 31, 2016 was $6,287,000 or $2.95 per share basic and $2.92 per share diluted as compared to $5,234,000 or $2.46 per share basic and $2.44 per share diluted for the fourth quarter of 2015. Net income per share (basic and diluted) for the fourth quarter of 2016 increased 20% over the same period in 2015. The Bank's annualized return on average equity for the fourth quarter of 2016 was 15.85%, and the annualized return on average assets was 1.27% as compared to 15.30% and 1.21% for the same period in 2015.
The Bank continued to produce strong growth in deposits, loans, and book value per share in 2016. Deposits increased by 12% to $1.366 billion. Net loans increased by 14% to $1.606 billion. Total assets increased by 14% to $2.015 billion. Book value per share increased by 16% to $75.50. This increase in book value per share excludes capital returned to the ownership through regular and special dividends; the Bank declared $1.56 in regular and special dividends in 2016.
Key credit and operational metrics remained strong in 2016. At December 31, 2016, non- performing assets totaled 0.09% of total assets as compared with 0.10% at December 31, 2015. Non-performing loans as a percentage of the total loan portfolio totaled 0.11% at December 31,
2016, as compared to 0.13% at December 31, 2015. At December 31, 2016 and 2015, the Bank did not own any foreclosed property. The efficiency ratio improved to 32.15% in 2016 as compared to 36.32% in 2015. Non-interest expense as a percentage of average assets improved to 1.00% in 2016, as compared to 1.16% in 2015. Both the efficiency ratio and operating expenses as a percentage of average assets reached new record lows in 2016 and reflect the Bank's particular focus on disciplined expense management.
President Robert H. Gaughen, Jr. stated, "We are pleased to report a strong return on capital in 2016. At Hingham, we take our role as stewards of the shareholders' capital seriously. Our emphasis on careful capital allocation, defensive and conservative underwriting, and disciplined cost control continues to serve our owners well. More important than performance in any one period, however, is a company's record of compounding shareholder capital over time and through credit cycles. On this measure, our team strives to set a high bar."
Hingham Institution for Savings is a Massachusetts-chartered savings bank located in Hingham, Massachusetts. Incorporated in 1834, it is the oldest financial institution headquartered in Hingham and one of the oldest continuously operating banks in the United States. The Bank's main offices are located on Main Street in Hingham, MA. The Bank also maintains branch offices in South Hingham and the neighboring towns of Cohasset, Hull, Scituate, Norwell and Weymouth as well as branches in the South End of Boston, Beacon Hill and on the island of Nantucket.
The Bank's shares of common stock are listed and traded on The Nasdaq Stock Market under the symbol HIFS.
HINGHAM INSTITUTION FOR SAVINGS Selected Financial Ratios Three Months EndedDecember 31,
Twelve Months EndedDecember 31,
(Unaudited)
Key Performance Ratios2015 2016 2015 2016
Return on average assets (1) 1.21 % 1.27 % 1.18 % 1.22 %
Return on average equity (1) | 15.30 | 15.85 | 14.81 | 15.59 |
Interest rate spread (1) (2) | 3.02 | 3.03 | 3.06 | 2.99 |
Net interest margin (1) (3) | 3.14 | 3.15 | 3.17 | 3.10 |
Non-interest expense to average assets (1) | 1.09 | 0.95 | 1.16 | 1.00 |
Efficiency ratio (4) | 34.55 | 29.93 | 36.32 | 32.15 |
Average equity to average assets | 7.90 | 7.98 | 7.97 | 7.85 |
Average interest-earning assets to average interest- | ||||
bearing liabilities | 115.90 | 116.65 | 115.85 | 116.19 |
(Unaudited)
Asset Quality Ratios December 31,2015
December 31,2016
Allowance for loan losses/total loans 0.70 % 0.68 %
Allowance for loan losses/non-performing loans 540.37 614.43
Non-performing loans/total loans 0.13 0.11
Non-performing loans/total assets 0.10 0.09
Non-performing assets/total assets 0.10 0.09
Share RelatedBook value per share $ 64.83 $ 75.50
Market value per share $ 119.80 $ 196.78
Shares outstanding at end of period 2,128,750 2,132,750
Annualized for the three months periods.
Interest rate spread represents the difference between the yield on interest-earning assets and cost of interest-bearing liabilities.
Net interest margin represents net interest income divided by average earning assets.
The efficiency ratio represents non-interest expense, divided by the sum of net interest income and non-interest income, excluding gain on sale of securities.
(Dollars in thousands, except per share data) | December 31, 2015 | December 31, 2016 |
(Unaudited) ASSETS | ||
Cash and due from banks | $ 6,944 | $ 7,816 |
Federal Reserve and other short-term investments | 254,069 | 315,116 |
Cash and cash equivalents | 261,013 | 322,932 |
Certificates of deposit | 6,206 | - |
CRA investment | 4,971 | 6,839 |
Other securities available for sale | 35,632 | 20,329 |
Securities available for sale, at fair value | 40,603 | 27,168 |
Federal Home Loan Bank stock, at cost Loans, net of allowance for loan losses of $9,905 at December 31, 2015 and $11,030 at December 31, 2016 | 19,796 1,405,533 | 24,472 1,605,647 |
Foreclosed assets Bank-owned life insurance | - 11,697 | - 11,962 |
Premises and equipment, net | 15,094 | 14,462 |
Accrued interest receivable | 3,270 | 3,529 |
Deferred income tax asset, net | 3,281 | 2,489 |
Other assets | 2,035 | 1,938 |
Total assets | $ 1,768,528 | $ 2,014,599 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Interest-bearing deposits | $ 1,088,742 | $ 1,218,360 |
Non-interest-bearing deposits | 128,285 | 147,749 |
Total deposits | 1,217,027 | 1,366,109 |
Federal Home Loan Bank advances | 402,464 | 475,318 |
Mortgage payable | 922 | 868 |
Mortgagors' escrow accounts | 4,850 | 5,585 |
Accrued interest payable | 303 | 400 |
Other liabilities | 4,947 | 5,295 |
Total liabilities | 1,630,513 | 1,853,575 |
Stockholders' equity: |
Preferred stock, $1.00 par value,
2,500,000 shares authorized, none issued - -
Common stock, $1.00 par value, 5,000,000 shares
authorized; 2,128,750 and 2,132,750 shares issued and | ||
outstanding at December 31, 2015 and 2016, | ||
respectively | 2,129 | 2,133 |
Additional paid-in capital | 11,052 | 11,575 |
Undivided profits | 124,481 | 144,580 |
Accumulated other comprehensive income | 353 | 2,736 |
Total stockholders' equity | 138,015 | 161,024 |
Total liabilities and stockholders' equity | $ 1,768,528 | $ 2,014,599 |
Hingham Institution for Savings published this content on 17 January 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 18 January 2017 16:36:03 UTC.
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