Butterfield Bank Reports Second Quarter Results
The Bank of N.T. Butterfield & Son Limited today [July 30] announced core earnings for the second quarter ended 30 June 2013 of $20.2 million, an improvement of 71% over the $11.8 million earned in the same quarter a year ago.
Net income for the quarter was $32.9 million, including non-core net items of $12.7 million, up $16.7 million compared to net income of $16.2 million in the second quarter of 2012.
The core cash return on average tangible common equity doubled to 11.0% in the second quarter of 2013 compared to 5.5% in the second quarter of 2012, reflecting measures taken to achieve strategic goals, particularly expense and capital management initiatives.
Year-to-date core earnings for the six months ended 30 June 2013 was $35.5 million ($0.05 per Share on a fully diluted basis), up $9.1 million (34%) from $26.4 million for the six-month period ended 30 June 2012, due primarily to strong expense management.
Year-to-date net income increased by $15.3 million for the six months ended 30 June 2013 to $46.2 million, compared to a year-to-date net income of $30.9 million for the six-month period ended 30 June 2012.
Brendan McDonagh, Butterfield’s Chairman & Chief Executive Officer, said, “We are pleased that our strategy to improve shareholder value has doubled the core cash return on tangible common equity to 11.0% for the quarter, up from 5.5% only a year ago.
“Against a backdrop of challenging economic environments in our major markets, we achieved this result largely through ongoing expense management initiatives across the organisation. By striving to earn our cost of capital, we will be stronger for our customers, employees and shareholders. To maintain this momentum, the senior management team has agreed to a ten percent reduction in compensation.
“With a further quarter of solid core earnings behind us, I am pleased to announce that the Board has declared a second interim Common dividend of $0.01 per Share as a means to return value to shareholders whilst maintaining the Bank’s strong capital position.”
Brad Rowse, Butterfield’s Chief Financial Officer, said, “Our core earnings improvements were led by strong expense management and a 4.0% increase in average customer deposits.
“Core non-interest expenses were down more than $6.7 million, or almost 10%, compared to the second quarter last year, owed to a reduction in salaries and benefits costs resulting from headcount reductions, as well as decreased technology and property costs.
“The improvement was reflected in a significant year-on-year improvement in our core efficiency ratio which decreased by seven percent to 70.7%. Higher net interest income, driven by investing the deposit improvement, and lower provisions for credit losses more than offset lower non-interest income.”
improving shareholder value at the expense of redundant employees
way to go business Bermuda
Rather that then the bank going bankrupt and 500 plus unemployeed. Not to mention the thousands who wont beable to get access to their savings.
Suck it up and move on. Welcome to the new “normal”.