Cambridge Bancorp(CATC) - 2022 Q3 - Quarterly Report

Financial Performance - Net income increased by $1.3 million, or 9.7%, to $14.6 million for the quarter ended September 30, 2022, compared to $13.3 million for the same quarter in 2021[166] - Diluted earnings per share were $2.07 for the quarter ended September 30, 2022, compared to $1.89 for the same quarter in 2021[166] - Net income increased by $828,000, or 2.0%, to $41.6 million for the nine months ended September 30, 2022, compared to $40.8 million for the same period in 2021[182] Income and Revenue - Net interest and dividend income before the provision for credit losses increased by $3.9 million, or 11.9%, to $36.3 million for the quarter ended September 30, 2022, compared to $32.4 million for the same quarter in 2021[167] - Total interest and dividend income increased by $6.6 million, or 19.7%, to $40.3 million for the quarter ended September 30, 2022, primarily due to growth in loan and investment securities portfolios[170] - Net interest and dividend income increased by $6.1 million, or 6.4%, to $102.3 million for the nine months ended September 30, 2022, primarily due to an increase in average earning assets[183] Expenses - The increase in noninterest expense for the quarter ended September 30, 2022, was $817,000, alongside an increase in income tax expense of $545,000 and a provision for credit losses of $526,000[166] - Total noninterest expense increased by $817,000, or 3.2%, to $26.3 million for the quarter ended September 30, 2022, primarily driven by increases in salaries and employee benefits[178] - Total noninterest expense increased by $3.5 million, or 4.7%, to $78.5 million for the nine months ended September 30, 2022, primarily due to higher salaries and employee benefits[194] Assets and Liabilities - As of September 30, 2022, the Company had total assets of approximately $5.1 billion and Assets under Management and Administration of approximately $3.8 billion[152] - Total assets increased by $251.8 million, or 5.1%, from $4.89 billion at December 31, 2021, to $5.14 billion at September 30, 2022[198] - Total liabilities amounted to $4,584,330 thousand, while shareholders' equity was $439,611 thousand, leading to total assets of $5,023,941 thousand[268] Loans and Credit - Total loans increased by $309.5 million, or 9.3%, from $3.32 billion at December 31, 2021, to $3.63 billion at September 30, 2022[199] - The total loan portfolio amounted to $3.63 billion as of September 30, 2022, an increase of $309.5 million, or 9.3%, from $3.32 billion at December 31, 2021[222] - Total non-performing loans rose by $997,000, or 18.5%, to $6.383 million at September 30, 2022, compared to $5.386 million at December 31, 2021[249] Deposits - Total deposits decreased by $49.7 million, or 1.1%, to $4.28 billion at September 30, 2022, from $4.33 billion at December 31, 2021[202] - Demand deposits (non-interest bearing) increased to $1,444,765 thousand, accounting for 33.7% of total deposits, compared to 32.1% in the previous year[261] Interest Rates and Margins - The net interest margin for the period was 2.95%, compared to 2.86% in the previous quarter, indicating an improvement in profitability[265] - Adjusted net interest margin for the nine months ended September 30, 2022, was 2.80%, a decrease of 22 basis points from 3.02% for the same period in 2021[274] - The Company actively manages interest rate risk through various tools, including interest rate sensitivity analysis and net interest margin reports[280] Mergers and Acquisitions - The Company completed the Northmark Merger on October 1, 2022, paying total consideration of $62.8 million and assuming $316.5 million in loans while acquiring $373.0 million in deposits[158] Equity and Capital - Total shareholders' equity increased by $8.5 million, or 1.9%, to $446.3 million at September 30, 2022, from $437.8 million at December 31, 2021[206] - The Company exceeded regulatory minimum levels to be considered "well-capitalized" as of September 30, 2022[296] Risk Management - The Company continues to diversify its loan risks among various sectors, with no significant concentrations in any one business sector[242] - The Company regularly reviews debt securities for expected credit loss using both qualitative and quantitative criteria[220]