Brookline Bancorp (BRKL) Q4 2024 earnings summary

Executive summary

• Reported Q4 2024 net income of $17.5M ($0.20 EPS); operating earnings of $20.7M ($0.23 EPS), excluding $3.4M in merger-related charges.

• Announced a strategic merger with Berkshire Hills Bancorp to form a $24B institution, expected to close in H2 2025, subject to regulatory and shareholder approval.

• Loans grew by $24M and customer deposits increased by $117M sequentially; total assets at year-end 2024 were $11.9B, up $228.6M sequentially.

• Board declared a quarterly dividend of $0.135 per share, payable February 28, 2025.

Financial highlights

• Net interest income for Q4 2024 was $85.0M, up $2.0M sequentially; net interest margin rose to 3.12% from 3.07%.

• Non-interest income for Q4 2024 was $6.6M, up $0.2M sequentially; non-interest expense increased $5.8M sequentially to $63.7M, mainly due to merger expenses and higher compensation.

• Provision for credit losses was $4.0M, down $0.7M from Q3.

• Net charge-offs were $7.3M (0.30% annualized), primarily from equipment finance.

• Dividend maintained at $0.135 per share.

Outlook and guidance

• Net interest margin expected to improve by 4-8 basis points in Q1 and continue rising through 2025.

• Loan portfolio growth anticipated in low single digits for 2025; deposit growth projected at 4%-5%.

• Non-interest income projected at $6-$7M per quarter; expenses managed to $247M or less for the year, excluding merger costs.

• Effective tax rate expected at 24.25%.

• Economic forecast weightings for CECL models shifted to 35% moderate recession, 40% baseline, and 25% stronger near-term growth.