Brookline Bancorp (BRKL) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 was $16.4 million ($0.18 per share), up from Q1 2024 but down year-over-year; operating earnings were $17.0 million ($0.19 per share).

• Achieved solid loan and deposit growth across all banks, with loans and deposits each increasing by $66 million in the quarter.

• Exited the specialty vehicle finance business, incurring a $0.8 million restructuring charge and reducing staff by 21.

• Board declared a quarterly dividend of $0.135 per share, payable August 30, 2024.

• Asset quality weakened, with nonperforming assets rising to $62.7 million (0.54% of assets).

Financial highlights

• Total assets grew by $92 million sequentially to $11.6 billion, driven by $66 million in loan growth.

• Net interest income was $80 million, down $1.6 million from Q1; net interest margin declined 6 bps to 3.00%.

• Non-interest income was $6.4 million, flat sequentially and up year-over-year.

• Non-interest expense decreased $1.8 million to $59.2 million, including a $0.8 million restructuring charge.

• Provision for credit losses was $5.6 million, down from Q1; net charge-offs were $8.4 million, mainly from equipment and commercial real estate.

Outlook and guidance

• Management expects net interest margin to stabilize and then increase as loans reprice; Q3 margin projected at 3.00%-3.10%.

• Loan growth expected at 2%-5% and deposit growth at 4%-5% across all segments.

• Non-interest income expected at $6-$7 million per quarter; operating expenses targeted at $240 million or less for the year.

• Exiting specialty vehicle finance will reduce operating expenses by ~$800,000 per quarter.

• Effective tax rate expected at 24.5% for the remainder of the year.