Berkshire Hills Bancorp(US:BHLB)2025-11-10 21:41Financial Performance - The Company reported a net loss of $(50.2) million, or $(0.57) per share, for the three months ended September 30, 2025, a decrease of $70.4 million from the previous year [274]. - Operating earnings after tax for the three months ended September 30, 2025, were $38,473 thousand, up from $20,142 thousand in 2024 [285]. - Reported pretax income for the three months ended September 30, 2025, was $(71,873) thousand, compared to $26,748 thousand for the same period in 2024 [285]. - The annualized return on average assets was (1.32)% for the three months ended September 30, 2025, compared to 0.70% for the same period in 2024 [276]. - Non-interest income for the three months ended September 30, 2025, increased by $5.997 million, or 94.5%, to $12.345 million compared to the same period in 2024 [411]. Asset and Liability Management - Total assets increased by $10.9 billion to $22.8 billion as of September 30, 2025, primarily due to assets assumed in the Merger [264]. - Total loans and leases rose by $8.5 billion to $18.2 billion as of September 30, 2025, with commercial loan portfolios representing 77.5% of total loans [265]. - Total deposits increased by $10.0 billion to $18.9 billion as of September 30, 2025, with core deposits totaling $12.8 billion, or 67.9% of total deposits [268]. - Total stockholders' equity as of September 30, 2025, was $2,414,996 thousand, compared to $1,230,362 thousand in 2024 [288]. - Total borrowed funds decreased by $439.3 million to $1.1 billion as of September 30, 2025, from $1.5 billion as of December 31, 2024 [269]. Credit Quality - Nonperforming assets totaled $102.0 million, or 0.45% of total assets, as of September 30, 2025, compared to $70.5 million, or 0.59% of total assets, as of December 31, 2024 [270]. - The allowance for loan and lease losses to total loans and leases ratio was 1.39% as of September 30, 2025, compared to 1.28% as of December 31, 2024 [271]. - The total allowance for loan and lease losses was $253.735 million as of September 30, 2025, with a total allowance as a percentage of total loans and leases at 1.39% [326]. - Loans and leases greater than 90 days past due and accruing increased to $23.6 million as of September 30, 2025, from $0.8 million as of December 31, 2024 [320]. - The Company had $678.3 million in criticized assets as of September 30, 2025, an increase of $425.6 million from $252.7 million as of December 31, 2024, primarily due to the Berkshire Bank merger [314]. Interest Income and Margin - The Company's net interest income increased by $49.6 million to $132.6 million for the three months ended September 30, 2025, compared to $83.0 million for the same period in 2024 [377]. - The net interest margin improved to 3.72% for the three months ended September 30, 2025, up from 3.07% for the same period in 2024 [388]. - The yield on interest-earning assets increased to 6.10% for the three months ended September 30, 2025, compared to 5.93% for the same period in 2024 [381]. - Total interest income from loans and leases was $198.3 million for the three months ended September 30, 2025, representing a yield of 6.34%, compared to $149.6 million and a yield of 6.17% for the same period in 2024 [396]. - The cost of interest-bearing liabilities decreased by 61 basis points to 3.06% for the three months ended September 30, 2025, down from 3.67% in the same period in 2024 [383]. Capital and Regulatory Compliance - The Company's common equity Tier 1 capital ratio was 10.44% as of September 30, 2025, compared to 10.46% as of December 31, 2024 [272]. - The total risk-based capital ratio for the Company was 12.45% as of September 30, 2025, exceeding the minimum requirement of 8% [435]. - The Company reported a Tier 1 leverage capital ratio of 13.32% as of September 30, 2025, well above the minimum required ratio of 4% [435]. - The Company and the Bank exceeded all regulatory capital requirements as of September 30, 2025, with a common equity Tier 1 capital ratio of 10.44%, significantly above the minimum required ratio of 4.5% [433]. - The Company maintained a capital conservation buffer of 2.5% above the minimum risk-based capital requirements, ensuring compliance with regulatory standards [433]. Deposits and Funding - Total deposits as a percentage of total assets was 82.8% as of September 30, 2025, compared to 74.8% as of December 31, 2024 [346]. - Core deposits rose by $6.7 billion, with the ratio of Core deposits to total deposits decreasing to 67.9% as of September 30, 2025, from 69.1% as of December 31, 2024 [347]. - Brokered deposits increased by $36.9 million to $905.9 million as of September 30, 2025, but decreased as a percentage of total deposits to 4.8% from 9.8% [349]. - The Company had uninsured municipal deposits requiring collateral of $263.3 million as of September 30, 2025 [354]. - Total deposits reached $18.9 billion as of September 30, 2025, representing 94.6% of total funding [424].