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Lakeland Bancorp Announces First Quarter Results
Source: Nasdaq GlobeNewswire / 19 Apr 2024 07:00:38 America/Chicago
OAK RIDGE, N.J., April 19, 2024 (GLOBE NEWSWIRE) -- Lakeland Bancorp, Inc. (NASDAQ: LBAI) (the “Company”), the parent company of Lakeland Bank (“Lakeland”), reported net income of $19.8 million and earnings per diluted share ("EPS") of $0.30 for the three months ended March 31, 2024 compared to net income of $19.8 million and diluted EPS of $0.30 for the three months ended March 31, 2023. For the first quarter of 2024, annualized return on average assets was 0.73%, annualized return on average common equity was 6.79% and annualized return on average tangible common equity (non-GAAP) was 8.91%.
Thomas Shara, Lakeland Bancorp’s President and CEO commented on the quarterly financial results, "Despite the uncertain economic environment, we are pleased with our results and our continued outstanding asset quality. I want to thank all of the Lakeland associates for their continued incredible contributions and unwavering customer support."
Regarding the announced merger with Provident Financial Services, Inc. ("Provident"), Mr. Shara continued, "We are delighted that all regulatory approvals required for the merger have been obtained and Provident is diligently moving forward with its subordinated debt offering which is a required closing condition of the merger. Both companies are excited to complete the merger quickly and create New Jersey’s super community bank that focuses on serving our customers.”
First Quarter 2024 Highlights
- In the first quarter of 2024 a benefit for credit losses of $2.7 million was recorded resulting primarily from a $2.9 million recovery on Signature Bank subordinated debt previously charged off partially offset by a $239,000 provision for credit losses on loans.
- First quarter 2024 results continue to be impacted by the increased market rate environment. Net interest margin for the first quarter of 2024 decreased six basis points to 2.46% from 2.52% in the prior quarter and decreased 61 basis points from 3.07% in the first quarter of 2023. For more information, please see "Net Interest Margin and Net Interest Income" below.
- Nonperforming assets decreased 12% to $14.9 million, or 0.14% of total assets, for the first quarter of 2024 compared to $16.9 million, or 0.16% of total assets, in the first quarter of 2023 and decreased 43% compared to $26.0 million, or 0.23% of total assets in the linked fourth quarter.
Net Interest Margin and Net Interest Income
Net interest margin for the three months ended March 31, 2024 declined from previous periods as a result of an increase in the cost of interest-bearing liabilities partially offset by an increase in the yields on interest-earning assets driven by the increase in market interest rates. The increased rate environment also has resulted in a change in customers' banking behaviors causing them to move funds from noninterest-bearing and lower yielding interest-bearing transaction and savings accounts to higher yielding time deposits.
Net interest income for the first quarter of 2024 of $62.6 million decreased $13.4 million compared to the first quarter of 2023.
Net interest margin for the first quarter of 2024 of 2.46% decreased 61 basis points compared to the first quarter of 2023 and decreased 6 basis points compared to the fourth quarter of 2023.
The yield on interest-earning assets for the first quarter of 2024 increased 42 basis points to 4.98% as compared to 4.56% for the first quarter of 2023 and increased 5 basis points as compared to 4.93% for the fourth quarter of 2023.
The cost of interest-bearing liabilities for the first quarter of 2024 was 3.39% compared to 2.11% for the first quarter of 2023 and 3.25% for the fourth quarter of 2023.
Noninterest Income
For the first quarter of 2024, noninterest income totaled $5.1 million, a decrease of $1.2 million as compared to the first quarter of 2023. Service charges on deposit accounts declined $830,000 from the first quarter of 2023 to the same period in 2024 resulting from a decline in interchange income due to the impact of the Durbin Amendment which became effective for Lakeland in the third quarter of 2023. One of the provisions of the Durbin Amendment is reduced interchange income for banks over $10 billion in assets. Commissions and fees decreased $235,000 driven primarily by decreases in loan fee income and investment services income. Losses on equity securities totaled $129,000 in the first quarter of 2024 compared to gains of $148,000 in the first quarter of 2023. Gains on sales of loans decreased $125,000 compared to the first quarter of 2023, while swap income increased $233,000. Additionally, income on bank owned life insurance increased $101,000 from the first quarter of 2023 to the same period in 2024 due primarily to a claim received in the first quarter of 2024.
Noninterest Expense
Noninterest expense for the first quarter of 2024 of $44.6 million decreased $4.0 million compared to the first quarter of 2023 due primarily to compensation and employee benefits which decreased $3.1 million primarily as a result of a decline in headcount related to the anticipated merger with Provident Financial Services, Inc. Merger-related expenses declined from $295,000 in the first quarter of 2023 to $68,000 for the first quarter of 2024 due to the timing of expenses incurred. Other operating expenses in the first quarter of 2024 decreased $865,000 compared to the same period in 2023 due primarily to decreased consulting fees, telecommunications expense, appraisal fees and other expenses. FDIC insurance expense increased $430,000 due to an increase in the assessment rate starting in second quarter of 2023 related to Lakeland's asset size exceeding $10 billion.
Income Tax Expense
The effective tax rate for the first quarter of 2024 was 23.0% compared to 22.9% for the first quarter of 2023.
Financial Condition
At March 31, 2024, total assets were $10.96 billion, a decrease of $173.7 million, compared to December 31, 2023. As of March 31, 2024, total loans decreased $23.4 million to $8.32 billion and investment securities decreased $41.9 million to $1.81 billion from December 31, 2023. On the funding side, total deposits decreased $80.8 million from December 31, 2023, to $8.50 billion at March 31, 2024. During the first three months of 2024, noninterest-bearing accounts and transaction and savings accounts decreased $102.6 million and $41.5 million, respectively, while time deposits increased $63.3 million. Borrowings decreased $111.1 million from December 31, 2023 to March 31, 2024. At March 31, 2024, total loans as a percent of total deposits was 97.9%.
Asset Quality
At March 31, 2024, non-performing assets totaled $14.9 million or 0.14% of total assets compared to $16.9 million, or 0.16% of total assets at March 31, 2023 and $26.0 million, or 0.23% of total assets at December 31, 2023. Non-performing assets decreased $11.1 million compared to the fourth quarter of 2023 primarily as a result of the full payoff of one construction loan totaling $12.7 million that was in non-accrual status. Non-accrual loans as a percent of total loans was 0.18% at March 31, 2024, compared to 0.21% at March 31, 2023 and 0.31% at December 31, 2023. The allowance for credit losses on loans totaled $76.8 million, 0.92% of total loans, at March 31, 2024, compared to $71.4 million, 0.90% of total loans, at March 31, 2023. In the first quarter of 2024, the Company had net charge-offs of $579,000 or 0.03% of average loans compared to $74,000 or 0.00% of average loans on an annualized basis for the same period in 2023.
In the first quarter of 2024 a $2.7 million benefit for credit losses was recorded compared to a provision of $7.9 million in the first quarter of 2023. The benefit for credit losses for the first quarter of 2024 is comprised of a benefit for credit losses on investment securities of $2.9 million, a provision for credit losses on loans of $239,000 and a benefit for off-balance-sheet exposures of $72,000.
Capital
At March 31, 2024, stockholders' equity was $1.18 billion compared to $1.17 billion at December 31, 2023, a 1% increase, resulting primarily from net income, partially offset by the payment of dividends. Lakeland Bank remains above FDIC “well capitalized” standards, with a Tier 1 leverage ratio of 9.46% at March 31, 2024. The book value per common share increased 4% to $18.10 at March 31, 2024 compared to $17.33 at March 31, 2023. Tangible book value per common share was $13.83 and $13.01 at March 31, 2024 and 2023, respectively (see "Supplemental Information - Non-GAAP Financial Measures" for a reconciliation of non-GAAP financial measures, including tangible book value). At March 31, 2024, the Company’s common equity to assets ratio and tangible common equity to tangible assets ratio (non-GAAP) were 10.76% and 8.43%, respectively, compared to 10.40% and 8.02% at March 31, 2023. On April 17, 2024, the Company declared a quarterly cash dividend of $0.145 per share to be paid on May 8, 2024, to shareholders of record as of April 29, 2024.
Forward-Looking Statements
The information disclosed in this document includes various forward-looking statements that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words “anticipates,” “projects,” “intends,” “estimates,” “expects,” “believes,” “plans,” “may,” “will,” “should,” “could,” and other similar expressions are intended to identify such forward-looking statements. The Company cautions that these forward-looking statements are necessarily speculative and speak only as of the date made, and are subject to numerous assumptions, risks and uncertainties, all of which may change over time. Actual results could differ materially from such forward-looking statements. Accordingly, you should not place undue reliance on forward-looking statements. In addition to the specific risk factors disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, as updated by our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, the following factors, among others, could cause actual results to differ materially and adversely from such forward-looking statements: changes in the financial services industry and the U.S. and global capital markets; inflation and other changes in economic conditions nationally, regionally and in the Company’s markets; the nature and timing of actions of the Federal Reserve Board and other regulators; the nature and timing of legislation and regulation affecting the financial services industry; government intervention in the U.S. financial system; changes in federal and state tax laws; changes in levels of market interest rates, which may affect demand for our products and the value of our financial instruments; pricing pressures on loan and deposit products; credit risks of the Company’s lending and leasing activities; successful implementation, deployment and upgrades of new and existing technology, systems, services and products; customers’ acceptance of the Company’s products and services; competition and expenses related to our announced merger with Provident Financial, unexpected delays related to the merger, inability to satisfy other closing conditions required to complete the merger, and failure to realize anticipated efficiencies and synergies from the merger. Any statements made by the Company that are not historical facts should be considered to be forward-looking statements. The Company is not obligated to update and does not undertake to update any of its forward-looking statements made herein.
Explanation of Non-GAAP Financial Measures
Reported amounts are presented in accordance with U.S. generally accepted accounting principles ("GAAP"). This press release also contains certain supplemental non-GAAP information that the Company’s management uses in its analysis of the Company’s financial results.
The Company also provides measurements and ratios based on tangible equity and tangible assets. These measures are utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, the Company’s management believes that such information is useful to investors.
Specifically, the Company also uses an efficiency ratio that is a non-GAAP financial measure. The ratio that the Company uses excludes amortization of core deposit intangibles, and, where applicable, long-term debt prepayment fees and merger-related expenses. Income for the non-GAAP ratio is increased by the favorable effect of tax-exempt income and excludes gains and losses from the sale of investment securities, which can vary from period to period. The Company uses this ratio because it believes the ratio provides a relevant measure to compare the operating performance period to period.
These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. See accompanying "Supplemental Information - Non-GAAP Financial Measures" and "Supplemental Information – Reconciliation of Net Income" for a reconciliation of non-GAAP financial measures.
About Lakeland
Lakeland Bank is the wholly-owned subsidiary of Lakeland Bancorp, Inc. (NASDAQ:LBAI), which had $10.96 billion in total assets at March 31, 2024. With an extensive branch network and commercial lending centers throughout New Jersey and Highland Mills, N.Y., the Bank offers business and retail banking products and services. Business services include commercial loans and lines of credit, commercial real estate loans, loans for healthcare services, asset-based lending, equipment financing, small business loans and lines and cash management services. Consumer services include online and mobile banking, home equity loans and lines, mortgage options and wealth management solutions. Lakeland is proud to be recognized as one of New Jersey's Best-In State Banks by Forbes and Statista, rated a 5-Star Bank by Bauer Financial and named one of New Jersey's 50 Fastest Growing Companies by NJBIZ. Visit LakelandBank.com or 973-697-6140 for more information.
Thomas J. Shara Thomas F. Splaine President & CEO EVP & CFO Lakeland Bancorp, Inc. and Subsidiaries
Consolidated Statements of Income (Unaudited)For the Three Months Ended
March 31,(in thousands, except per share data) 2024 2023 Interest Income Loans and fees $ 114,680 $ 100,481 Federal funds sold and interest-bearing deposits with banks 1,102 728 Taxable investment securities and other 11,631 11,554 Tax-exempt investment securities 1,448 1,642 Total Interest Income 128,861 114,405 Interest Expense Deposits 54,763 29,158 Federal funds purchased and securities sold under agreements to repurchase 5,560 7,222 Other borrowings 5,980 2,100 Total Interest Expense 66,303 38,480 Net Interest Income 62,558 75,925 (Benefit) provision for credit losses (2,692 ) 7,893 Net Interest Income after Provision for Credit Losses 65,250 68,032 Noninterest Income Service charges on deposit accounts 1,959 2,789 Commissions and fees 1,690 1,925 Income on bank owned life insurance 877 776 (Loss) gain on equity securities (129 ) 148 Gains on sales of loans 305 430 Swap income 289 56 Other income 103 141 Total Noninterest Income 5,094 6,265 Noninterest Expense Compensation and employee benefits 26,874 29,996 Premises and equipment 7,886 7,977 FDIC insurance 1,393 963 Data processing 1,781 1,862 Merger-related expenses 68 295 Other operating expenses 6,647 7,512 Total Noninterest Expense 44,649 48,605 Income before provision for income taxes 25,695 25,692 Provision for income taxes 5,900 5,887 Net Income $ 19,795 $ 19,805 Per Share of Common Stock Basic earnings $ 0.30 $ 0.30 Diluted earnings $ 0.30 $ 0.30 Dividends $ 0.145 $ 0.145 Lakeland Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets(dollars in thousands) March 31, 2024 December 31, 2023 (Unaudited) Assets Cash $ 203,186 $ 293,366 Interest-bearing deposits due from banks 4,433 27,289 Total cash and cash equivalents 207,619 320,655 Investment securities available for sale, at estimated fair value (allowance for credit losses of $0 at March 31, 2024 and December 31, 2023) 914,029 946,282 Investment securities held to maturity (estimated fair value of $681,857 at March 31, 2024 and $702,563 at December 31, 2023, allowance for credit losses of $146 at March 31, 2024 and December 31, 2023) 827,107 836,377 Equity securities, at fair value 17,646 17,697 Federal Home Loan Bank and other membership stocks, at cost 52,205 52,517 Loans held for sale 564 664 Loans, net of deferred fees 8,320,424 8,343,861 Less: Allowance for credit losses 76,823 77,163 Net loans 8,243,601 8,266,698 Premises and equipment, net 51,783 52,846 Operating lease right-of-use assets 15,009 16,008 Accrued interest receivable 37,968 37,508 Goodwill 271,829 271,829 Other identifiable intangible assets 6,623 7,058 Bank owned life insurance 160,587 159,862 Other assets 158,314 152,566 Total Assets $ 10,964,884 $ 11,138,567 Liabilities and Stockholders' Equity Liabilities Deposits: Noninterest-bearing $ 1,679,033 $ 1,781,619 Savings and interest-bearing transaction accounts 4,790,634 4,832,171 Time deposits $250 thousand and under 1,518,991 1,458,640 Time deposits over $250 thousand 511,780 508,808 Total deposits 8,500,438 8,581,238 Federal funds purchased and securities sold under agreements to repurchase 602,956 714,152 Other borrowings 325,000 325,000 Subordinated debentures 194,814 194,705 Operating lease liabilities 15,820 16,891 Other liabilities 146,426 137,212 Total Liabilities 9,785,454 9,969,198 Stockholders' Equity Common stock, no par value; authorized 100,000,000 shares; issued 65,285,261 shares and outstanding 65,154,226 shares at March 31, 2024 and issued 65,161,310 shares and outstanding 65,030,275 shares at December 31, 2023 859,712 858,857 Retained earnings 386,319 376,044 Treasury shares, at cost, 131,035 shares at March 31, 2024 and December 31, 2023 (1,452 ) (1,452 ) Accumulated other comprehensive loss (65,149 ) (64,080 ) Total Stockholders' Equity 1,179,430 1,169,369 Total Liabilities and Stockholders' Equity $ 10,964,884 $ 11,138,567 Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)For the Quarter Ended (dollars in thousands, except per share data) March 31,
2024December 31,
2023September 30,
2023June 30,
2023March 31,
2023Income Statement Net interest income $ 62,558 $ 65,308 $ 68,906 $ 71,542 $ 75,925 Benefit (provision) for credit losses 2,692 (1,950 ) (1,262 ) (1,947 ) (7,893 ) Gains on sales of loans 305 505 349 229 430 (Loss) gain on equity securities (129 ) 391 (294 ) (135 ) 148 Other noninterest income 4,918 5,890 5,363 6,575 5,687 Merger-related expenses (68 ) (129 ) (198 ) (242 ) (295 ) Other noninterest expense (44,581 ) (42,864 ) (44,170 ) (46,766 ) (48,310 ) Pretax income 25,695 27,151 28,694 29,256 25,692 Provision for income taxes (5,900 ) (7,083 ) (6,455 ) (6,628 ) (5,887 ) Net income $ 19,795 $ 20,068 $ 22,239 $ 22,628 $ 19,805 Basic earnings per common share $ 0.30 $ 0.31 $ 0.34 $ 0.34 $ 0.30 Diluted earnings per common share $ 0.30 $ 0.30 $ 0.34 $ 0.34 $ 0.30 Dividends paid per common share $ 0.145 $ 0.145 $ 0.145 $ 0.145 $ 0.145 Dividends paid $ 9,520 $ 9,521 $ 9,521 $ 9,529 $ 9,500 Weighted average shares - basic 65,135 65,064 65,064 65,059 64,966 Weighted average shares - diluted 65,324 65,258 65,222 65,173 65,228 Selected Operating Ratios Annualized return on average assets 0.73 % 0.73 % 0.81 % 0.84 % 0.75 % Annualized return on average common equity 6.79 % 6.97 % 7.76 % 8.03 % 7.17 % Annualized return on average tangible common equity (1) 8.91 % 9.23 % 10.29 % 10.67 % 9.57 % Annualized net interest margin 2.46 % 2.52 % 2.68 % 2.83 % 3.07 % Efficiency ratio (1) 64.88 % 58.45 % 58.43 % 58.82 % 57.84 % Common stockholders' equity to total assets 10.76 % 10.50 % 10.16 % 10.38 % 10.40 % Tangible common equity to tangible assets (1) 8.43 % 8.20 % 7.86 % 8.02 % 8.02 % Tier 1 risk-based ratio 11.72 % 11.51 % 11.31 % 11.43 % 11.33 % Total risk-based ratio 14.33 % 14.11 % 13.87 % 14.03 % 13.93 % Tier 1 leverage ratio 9.46 % 9.27 % 9.24 % 9.17 % 9.13 % Common equity tier 1 capital ratio 11.20 % 11.00 % 10.80 % 10.90 % 10.81 % Book value per common share $ 18.10 $ 17.98 $ 17.46 $ 17.40 $ 17.33 Tangible book value per common share (1) $ 13.83 $ 13.69 $ 13.17 $ 13.10 $ 13.01 (1) See Supplemental Information - Non-GAAP Financial Measures
Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)For the Quarter Ended (dollars in thousands) March 31,
2024December 31,
2023September 30,
2023June 30,
2023March 31,
2023Selected Balance Sheet Data at Period End Loans $ 8,320,424 $ 8,343,861 $ 8,294,057 $ 8,101,287 $ 7,952,553 Allowance for credit losses on loans 76,823 77,163 75,159 73,965 71,403 Investment securities 1,810,987 1,852,873 1,860,996 1,938,611 1,994,927 Total assets 10,964,884 11,138,567 11,176,809 10,897,966 10,837,241 Total deposits 8,500,438 8,581,238 8,602,503 8,444,681 8,536,943 Short-term borrowings 602,956 714,152 728,769 938,718 813,328 Other borrowings 519,814 519,705 519,596 219,486 219,376 Stockholders' equity 1,179,430 1,169,369 1,135,627 1,131,702 1,126,580 Loans Non-owner occupied commercial $ 2,973,652 $ 2,987,959 $ 2,980,811 $ 2,991,124 $ 2,943,897 Owner occupied commercial 1,264,061 1,283,221 1,299,977 1,201,049 1,205,635 Multifamily 1,405,399 1,408,905 1,361,628 1,314,255 1,275,771 Non-owner occupied residential 202,014 213,986 208,560 205,818 210,203 Commercial, industrial and other 642,151 638,894 632,919 594,790 562,677 Construction 317,253 302,745 333,998 354,918 404,994 Equipment financing 178,157 179,171 174,946 173,469 161,889 Residential mortgages 997,569 985,768 956,535 922,109 857,427 Consumer and home equity 340,168 343,212 344,683 343,755 330,060 Total loans $ 8,320,424 $ 8,343,861 $ 8,294,057 $ 8,101,287 $ 7,952,553 Deposits Noninterest-bearing $ 1,679,033 $ 1,781,619 $ 1,857,324 $ 1,866,252 $ 1,998,590 Savings and interest-bearing transaction accounts 4,790,634 4,832,171 4,862,246 4,775,184 4,918,041 Time deposits 2,030,771 1,967,448 1,882,933 1,803,245 1,620,312 Total deposits $ 8,500,438 $ 8,581,238 $ 8,602,503 $ 8,444,681 $ 8,536,943 Total loans to total deposits ratio 97.9 % 97.2 % 96.4 % 95.9 % 93.2 % Selected Average Balance Sheet Data Loans $ 8,304,235 $ 8,304,747 $ 8,167,362 $ 7,999,285 $ 7,900,426 Investment securities 1,916,350 1,955,407 2,013,153 2,068,073 2,117,076 Interest-earning assets 10,298,889 10,354,079 10,276,375 10,214,142 10,091,341 Total assets 10,888,436 10,963,641 10,875,553 10,808,261 10,698,807 Noninterest-bearing demand deposits 1,710,604 1,829,996 1,871,516 1,935,776 2,040,070 Savings deposits 669,336 699,199 759,232 830,836 928,796 Interest-bearing transaction accounts 4,210,331 4,229,019 4,103,217 4,007,867 4,224,024 Time deposits 2,029,735 1,926,436 1,856,266 1,722,935 1,385,661 Total deposits 8,620,006 8,684,650 8,590,231 8,497,414 8,578,551 Short-term borrowings 415,547 423,629 744,582 813,471 617,611 Other borrowings 519,748 519,635 232,573 219,425 219,308 Total interest-bearing liabilities 7,844,697 7,797,918 7,695,870 7,594,534 7,375,400 Stockholders' equity 1,172,324 1,142,031 1,137,387 1,130,563 1,120,356 Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)For the Quarter Ended (dollars in thousands) March 31,
2024December 31,
2023September 30,
2023June 30,
2023March 31,
2023Average Annualized Yields (Taxable Equivalent Basis) and Costs Assets Loans 5.48 % 5.48 % 5.42 % 5.22 % 5.10 % Taxable investment securities and other 2.87 % 2.87 % 2.84 % 2.74 % 2.61 % Tax-exempt securities 2.50 % 2.49 % 2.49 % 2.45 % 2.41 % Federal funds sold and interest-bearing cash accounts 5.66 % 5.46 % 5.41 % 5.41 % 4.00 % Total interest-earning assets 4.98 % 4.93 % 4.86 % 4.71 % 4.56 % Liabilities Savings accounts 0.19 % 0.20 % 0.24 % 0.26 % 0.28 % Interest-bearing transaction accounts 3.00 % 2.89 % 2.60 % 2.16 % 1.85 % Time deposits 4.57 % 4.34 % 3.78 % 3.39 % 2.71 % Borrowings 4.88 % 4.91 % 5.04 % 4.80 % 4.46 % Total interest-bearing liabilities 3.39 % 3.25 % 2.96 % 2.59 % 2.11 % Net interest spread (taxable equivalent basis) 1.60 % 1.68 % 1.90 % 2.12 % 2.45 % Annualized net interest margin (taxable equivalent basis) 2.46 % 2.52 % 2.68 % 2.83 % 3.07 % Annualized cost of deposits 2.56 % 2.38 % 2.08 % 1.73 % 1.38 % Loan Quality Data Allowance for Credit Losses on Loans Balance at beginning of period $ 77,163 $ 75,159 $ 73,965 $ 71,403 $ 70,264 Provision for credit losses on loans 239 2,246 1,327 2,422 1,213 Charge-offs (617 ) (265 ) (217 ) (148 ) (139 ) Recoveries 38 23 84 288 65 Balance at end of period $ 76,823 $ 77,163 $ 75,159 $ 73,965 $ 71,403 Net Loan Charge-Offs (Recoveries) Non owner occupied commercial $ — $ — $ — $ — $ — Owner occupied commercial — — — (6 ) — Non owner occupied residential — — — — — Commercial, industrial and other (21 ) (7 ) — (163 ) (35 ) Construction 564 — — 13 — Equipment finance — 83 136 12 46 Residential mortgages — 128 — — — Consumer and home equity 36 38 (3 ) 4 63 Net charge-offs (recoveries) $ 579 $ 242 $ 133 $ (140 ) $ 74 Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)For the Quarter Ended (dollars in thousands) March 31,
2024December 31,
2023September 30,
2023June 30,
2023March 31,
2023Non-Performing Assets (1) Non owner occupied commercial $ 745 $ 769 $ 798 $ 864 $ 908 Owner occupied commercial 7,018 6,849 7,026 8,076 8,757 Multifamily 1,167 1,096 1,106 266 584 Non owner occupied residential 517 — — 41 — Commercial, industrial and other 323 401 217 1,737 2,221 Construction — 12,698 — — 980 Equipment finance 1,147 518 626 644 379 Residential mortgages 2,732 2,400 2,319 1,954 1,918 Consumer and home equity 1,204 1,232 1,331 2,486 1,131 Total non-accrual loans 14,853 25,963 13,423 16,068 16,878 Total non-performing assets $ 14,853 $ 25,963 $ 13,423 $ 16,068 $ 16,878 Loans past due 90 days or more and still accruing $ — $ — $ — $ — $ — Loans restructured and still accruing $ — $ — $ — $ — $ — Ratio of allowance for loan losses to total loans 0.92 % 0.92 % 0.91 % 0.91 % 0.90 % Total non-accrual loans to total loans 0.18 % 0.31 % 0.16 % 0.20 % 0.21 % Total non-performing assets to total assets 0.14 % 0.23 % 0.12 % 0.15 % 0.16 % Annualized net charge-offs (recoveries) to average loans 0.03 % 0.01 % 0.01 % (0.01 )% — % (1) Includes non-accrual purchased credit deteriorated loans.
Lakeland Bancorp, Inc.
Supplemental Information - Non-GAAP Financial Measures
(Unaudited)At or for the Quarter Ended (dollars in thousands, except per share amounts) March 31,
2024December 31,
2023September 30,
2023June 30,
2023March 31,
2023Calculation of Tangible Book Value Per Common Share Total common stockholders' equity at end of period - GAAP $ 1,179,430 $ 1,169,369 $ 1,135,627 $ 1,131,702 $ 1,126,580 Less: Goodwill 271,829 271,829 271,829 271,829 271,829 Less: Other identifiable intangible assets 6,623 7,058 7,559 8,060 8,572 Total tangible common stockholders' equity at end of period - Non-GAAP $ 900,978 $ 890,482 $ 856,239 $ 851,813 $ 846,179 Shares outstanding at end of period 65,154 65,030 65,030 65,028 65,017 Book value per share - GAAP $ 18.10 $ 17.98 $ 17.46 $ 17.40 $ 17.33 Tangible book value per share - Non-GAAP $ 13.83 $ 13.69 $ 13.17 $ 13.10 $ 13.01 Calculation of Tangible Common Equity to Tangible Assets Total tangible common stockholders' equity at end of period - Non-GAAP $ 900,978 $ 890,482 $ 856,239 $ 851,813 $ 846,179 Total assets at end of period - GAAP $ 10,964,884 $ 11,138,567 $ 11,176,809 $ 10,897,966 $ 10,837,241 Less: Goodwill 271,829 271,829 271,829 271,829 271,829 Less: Other identifiable intangible assets 6,623 7,058 7,559 8,060 8,572 Total tangible assets at end of period - Non-GAAP $ 10,686,432 $ 10,859,680 $ 10,897,421 $ 10,618,077 $ 10,556,840 Common equity to assets - GAAP 10.76 % 10.50 % 10.16 % 10.38 % 10.40 % Tangible common equity to tangible assets - Non-GAAP 8.43 % 8.20 % 7.86 % 8.02 % 8.02 % Calculation of Return on Average Tangible Common Equity Net income - GAAP $ 19,795 $ 20,068 $ 22,239 $ 22,628 $ 19,805 Total average common stockholders' equity - GAAP $ 1,172,324 $ 1,142,031 $ 1,137,387 $ 1,130,563 $ 1,120,356 Less: Average goodwill 271,829 271,829 271,829 271,829 271,829 Less: Average other identifiable intangible assets 6,905 7,383 7,887 8,353 8,904 Total average tangible common stockholders' equity - Non-GAAP $ 893,590 $ 862,819 $ 857,671 $ 850,381 $ 839,623 Return on average common stockholders' equity - GAAP 6.79 % 6.97 % 7.76 % 8.03 % 7.17 % Return on average tangible common stockholders' equity - Non-GAAP 8.91 % 9.23 % 10.29 % 10.67 % 9.57 % Calculation of Efficiency Ratio Total noninterest expense $ 44,649 $ 42,993 $ 44,368 $ 47,008 $ 48,605 Less: Amortization of core deposit intangibles 436 500 501 512 516 Merger-related expenses 68 129 198 242 295 Noninterest expense, as adjusted $ 44,145 $ 42,364 $ 43,669 $ 46,254 $ 47,794 Net interest income $ 62,558 $ 65,308 $ 68,906 $ 71,542 $ 75,925 Total noninterest income 5,094 6,786 5,418 6,669 6,265 Total revenue 67,652 72,094 74,324 78,211 82,190 Tax-equivalent adjustment on municipal securities 385 385 408 422 436 Total revenue, as adjusted $ 68,037 $ 72,479 $ 74,732 $ 78,633 $ 82,626 Efficiency ratio - Non-GAAP 64.88 % 58.45 % 58.43 % 58.82 % 57.84 % 
