0000912057-01-536221.txt : 20011026
0000912057-01-536221.hdr.sgml : 20011026
ACCESSION NUMBER: 0000912057-01-536221
CONFORMED SUBMISSION TYPE: 425
PUBLIC DOCUMENT COUNT: 1
FILED AS OF DATE: 20011022
SUBJECT COMPANY:
COMPANY DATA:
COMPANY CONFORMED NAME: BOSTON PRIVATE FINANCIAL HOLDINGS INC
CENTRAL INDEX KEY: 0000821127
STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022]
IRS NUMBER: 042976299
STATE OF INCORPORATION: MA
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 425
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-17089
FILM NUMBER: 1763772
BUSINESS ADDRESS:
STREET 1: 10 POST OFFICE SQ
CITY: BOSTON
STATE: MA
ZIP: 02109
BUSINESS PHONE: 6175561900
MAIL ADDRESS:
STREET 1: 10 POST OFFICE SQUARE
CITY: BOSTON
STATE: MA
ZIP: 02109
FORMER COMPANY:
FORMER CONFORMED NAME: BOSTON PRIVATE BANCORP INC
DATE OF NAME CHANGE: 19920703
FILED BY:
COMPANY DATA:
COMPANY CONFORMED NAME: BOSTON PRIVATE FINANCIAL HOLDINGS INC
CENTRAL INDEX KEY: 0000821127
STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022]
IRS NUMBER: 042976299
STATE OF INCORPORATION: MA
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 425
BUSINESS ADDRESS:
STREET 1: 10 POST OFFICE SQ
CITY: BOSTON
STATE: MA
ZIP: 02109
BUSINESS PHONE: 6175561900
MAIL ADDRESS:
STREET 1: 10 POST OFFICE SQUARE
CITY: BOSTON
STATE: MA
ZIP: 02109
FORMER COMPANY:
FORMER CONFORMED NAME: BOSTON PRIVATE BANCORP INC
DATE OF NAME CHANGE: 19920703
425
1
a2061551z425.txt
425
Filed by Boston Private Financial Holdings, Inc.
Pursuant to Rule 425 under the Securities Act of
1933, as amended, and deemed filed pursuant to
Rule 14a-12 under the Securities Exchange Act of
1934, as amended
Subject Company: Borel Bank & Trust Company
Commission File No.: 333-67746
This filing contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including, without limitation,
(i) Boston Private's outlook on future market performance, (ii) continuation of
superior shareholder returns, (iii) Boston Private's expectations regarding 2001
and 2002 results of operations, (iv) statements with respect to Boston Private's
and Borel's plans, objectives, expectations and intentions and other statements
that are not historical facts; (v) statements with respect to Boston Private's
wealth management initiatives in California; and (iv) other statements
identified by words such as "believes," "expects," "will," "anticipates,"
"estimates," "attain," "intends," "trending," "plans," "continue," "goal,"
"objectives," and similar expressions. These statements are based upon the
current beliefs and expectations of Boston Private's and Borel's management and
are subject to significant risks and uncertainties. Actual results may differ
from those set forth in the forward-looking statements.
The following factors, among others, could cause actual results to differ
materially from the anticipated results or other expectations expressed in
such forward-looking statements: (1) the risk that Borel's business will not
be integrated successfully with Boston Private's or such integration may be
more difficult, time-consuming or costly than expected; (2) the risk that the
pending Borel acquisition is not consummated in a timely fashion, or at all,
for any reason; (3) enactment of adverse government regulation; (4)
competitive pressures among depository and other financial institutions may
increase significantly and have an effect on pricing, spending, third-party
relationships and revenues; and (5) adverse conditions and volatility,
including as a result of recent economic uncertainty created by the September
11, 2001 terrorist attacks on the World Trade Center and the Pentagon, the
United States' war on terrorism, in the stock market, the public debt market
and other capital markets and the impact of such conditions on Boston
Private's asset management activities and fees from such activities. There is
also a risk that the strength or weakness of the United States economy in
general and specifically the strength or weakness of the New England,
California and other economies in which Boston Private operates or will be
operating, including as a result of recent economic uncertainty created by
the September 11, 2001 terrorist attacks on the World Trade Center and the
Pentagon, the United States' war on terrorism, may result in a deterioration
in overall credit quality and borrowers' ability to service and repay loans,
or a reduced demand for credit, including the resultant effect on the
combined company's loan portfolio, levels of charge-offs and non-performing
loans and allowance for loan losses, and reduced demand for wealth management
services. In addition, changes in the
interest rate environment may reduce interest margins and adversely impact net
interest income. Furthermore, there is a risk that if actual results differ from
Boston Private's expectations, dividends may not grow or continue at all.
Additional factors that could cause Boston Private's and Borel's results to
differ materially from those described in the forward-looking statements can be
found in Boston Private's other press releases and Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the
Securities and Exchange Commission, and in Borel's other press releases and
Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports
on Form 8-K filed with the Federal Deposit Insurance Corporation. Boston Private
and Borel do not undertake any obligation to update any forward-looking
statement to reflect circumstances or events that occur after the date the
forward-looking statements are made.
Boston Private has filed relevant documents concerning the merger with the
Securities and Exchange Commission including a registration statement on Form
S-4 containing a prospectus/proxy statement, which was mailed to shareholders on
or about October 15, 2001. WE URGE INVESTORS TO READ THESE DOCUMENTS BECAUSE
THEY CONTAIN IMPORTANT INFORMATION. Investors will be able to obtain these
documents free of charge at the SEC's website, (http://www.sec.gov). In
addition, documents filed with the SEC by Boston Private can be obtained,
without charge, by directing a request to Boston Private Financial Holdings,
Inc., Ten Post Office Square, Boston, Massachusetts 02109, Attn: Corporate
Clerk, telephone (617) 912-1900. Boston Private and its directors and executive
officers may be deemed to be participants in the solicitation of proxies in
connection with the merger. Information about the directors and executive
officers of Boston Private and their ownership of Boston Private common stock is
set forth in the proxy statement for Boston Private's 2001 annual meeting of
stockholders as filed on Schedule 14A with the SEC on March 9, 2001.
Borel has filed relevant documents concerning the acquisition with the Federal
Deposit Insurance Corporation including a proxy statement, which was mailed to
shareholders on or about October 15, 2001. WE URGE INVESTORS TO READ THESE
DOCUMENTS BECAUSE THEY CONTAIN IMPORTANT INFORMATION. Investors will be able to
obtain these documents from the offices of the FDIC located at 250 E Street,
S.W., Washington, D.C. 20219, telephone (800) 945-2186. The FDIC also maintains
a website at (http://www.fdic.gov). In addition, documents filed with the FDIC
by Borel can be obtained, without charge, by directing a request to Ms. Emanuela
M. Allgood, Secretary, Senior Vice President and Chief Financial Officer, Borel
Bank & Trust Company, 160 Bovet Road, San Mateo, California 94402, telephone
(650) 378-3790. Borel and its directors and executive officers may be deemed to
be participants in the solicitation of proxies in connection with the merger.
Information about the directors and executive officers of Borel and their
ownership of Borel common stock is set forth in the proxy statement for Borel's
2001 annual meeting of shareholders as filed with the FDIC on April 9, 2001.
Additional information about the interests of those participants may be obtained
from reading the definitive proxy statement regarding the proposed transaction.
THE FOLLOWING IS A LETTER TO SHAREHOLDERS SENT BY BOSTON PRIVATE FINANCIAL
HOLDINGS, INC. ON OR ABOUT OCTOBER 22, 2001:
OCTOBER 22, 2001
Dear Shareholders,
It is with a great amount of pride and confidence that I share Boston Private's
third quarter financial results directly with you, as reported in the enclosed
press release. I say "pride" because the financial strength and diversification
of our Company has been able to successfully transcend the broadly fluctuating
interest rate and stock market environments. I say "confidence" because our
wealth management strategy has proven itself to be sound in the past and will
guide us well in the future.
During the 8+ years I have been the CEO at Boston Private, we have attained
excellent returns for our shareholders. Our compounded earnings growth rate
during that period is 20+ %, and the third quarter of 2001 is the 35th straight
quarter of earnings increases for the Company. In addition, the continuation and
growth of our dividend, which we commenced early in the year 2000, is further
proof to the total return concept we employ on your behalf. Virtually all of the
Boston Private directors and senior management are significant shareholders and
thus we all are aligned with you as to the Company's financial goals as well.
The nation is facing some troubled times. The economy is slack, the stock
markets are uncertain, and we are all recovering from the unspeakable events in
early September. But I want to leave you with a strong impression: We at Boston
Private have never worked harder on your behalf and, if anything, have forged
even stronger bonds with our clients during these tumultuous times. We are
extremely confident about the future of our chosen marketplace and our strategy
to meet it capably. We're very appreciative of your support and look forward to
a long and mutually beneficial relationship with you.
Sincerely,
/s/ Timothy L. Vaill
Timothy L. Vaill, Chairman
THE FOLLOWING IS THE PRESS RELEASE, WHICH WAS ISSUED ON OCTOBER 18, 2001, AND
ATTACHED TO THE OCTOBER 22, 2001 LETTER TO SHAREHOLDERS SENT BY BOSTON PRIVATE
FINANCIAL HOLDINGS, INC.:
FOR IMMEDIATE RELEASE CONTACT: WALTER M. PRESSEY, CFO
(617) 912-1921
PETER A. MORRISSEY, JR.
(617) 523-4141
WWW. BOSTONPRIVATE.COM
----------------------
BOSTON PRIVATE CONTINUES STRONG EARNINGS GROWTH
Third Quarter 2001 EPS up 15% over previous year
BOSTON, MA, OCTOBER 18, 2001 - Boston Private Financial Holdings, Inc. (NASDAQ:
BPFH) today announced strong earnings for the third quarter of 2001. This
financial performance reflects the continued successful growth and strategic
diversification for this national wealth management company. The Company also
announced the continuation of its cash dividend to shareholders.
THIRD QUARTER FINANCIAL RESULTS
For the three months ended September 30, 2001, Boston Private reported fully
diluted earnings per share of $0.23, compared to $0.20 for the year ago period,
a 15% increase. Net income for the quarter was $4.0 million compared to $2.6
million for the same period a year ago. Total fees for the quarter grew to $11.6
million, or 54.2% of total revenues. The net interest margin also remained
strong for the quarter at 3.86% compared to 3.75% a year ago. The firm's average
balance sheet assets for the quarter were approximately $1.1 billion, with
shareholders' equity at 10.23% of total assets.
Timothy L. Vaill, Chairman and Chief Executive Officer, said, "The compounding
effect of a declining economy, uncertain stock market actions, lowering interest
rates and the tragic events of September 11th have created a very challenging
environment throughout the financial sector in
this country. Thus we are extremely gratified with Boston Private's attractive
earnings results during the third quarter of 2001. Despite the fact that market
performance reduced our net assets under management during the quarter by some
14.7%, the impact of this reduction was partially offset by strong new business
and account enhancements as investors increasingly sought the advice of our
portfolio managers during this period of uncertainty. We also believe that the
revenue diversification we have built into the company's core businesses in
recent years is helping us to attain a balanced and consistent financial
performance, and this factor also assisted us during the third quarter."
YEAR-TO-DATE FINANCIAL RESULTS
For the nine months ended September 30, 2001, Boston Private reported total net
income of $11.3 million, or $0.66 per diluted share, approximately 25% higher
than for the same period a year ago when it reported $0.53 per share. Comparing
the Company's results year-over-year, net interest income is up 57% to $27.5
million, investment management fees are up 24% to approximately $27.0 million,
and financial planning fees are also up about 24% for the period. The total loan
portfolio has increased by 36% during the period to approximately $800 million
while at the same time non-performing loans as a percentage of total loans have
DECLINED from 0.33% to 0.15%. Also, the private banking core deposits have grown
during that period to $797 million, a 23% increase for the period.
Like many other wealth management and financial firms that have exposure to the
U.S. stock markets, Boston Private saw some decline in market values during the
year. However, the Company believes it is ideally positioned to capitalize upon
a return to historical performance and valuations. According to Vaill, "Stock
market returns are trending toward the norm, and some of the excesses of the
nineties are being offset by recent performance. In the course of this migration
to historical levels, many asset classes will have a chance to shine. Boston
Private's mix of investment styles and philosophies positions us to gather new
assets effectively and participate acceptably in the performance sweepstakes. In
addition," he added, "the depth and breadth of our client relationships has
allowed us to continue financing their credit needs during this period, which
provides us the opportunity to enlarge those relationships when economic
conditions return to normal. This has been particularly true in our Commercial
Banking business where some other kinds of banks are reluctant to stay
involved."
Boston Private has an extensive history of working with entrepreneurs and small
to mid-sized business owners as well as with homeowners to help them with
lending and cash management needs. At September 30, 2001, commercial
loans--which averaged approximately $800,000 in size during the quarter, totaled
$300 million, and the jumbo loan mortgage portfolio reached $464 million, on the
way to setting a record year. The average size of these mortgage loans for this
year has been approximately $650,000. Both of these loan totals were up
considerably, 21.3% and 48.0% respectively, compared to one year ago. At the
same time, the funding for these loans comes from core deposits which have grown
at a similar pace and which represent an effective cash management service to
the business community as well as to high net worth individuals. As mentioned
above, the credit quality of the loan portfolio remains excellent.
DIVIDEND PAYMENTS CONTINUE
Concurrent with the release of the third quarter 2001 earnings, the Board of
Directors of Boston Private Financial Holdings also announced the declaration of
a cash dividend to shareholders of $0.035 per share, reflecting the quarterly
earnings performance. This is a continuation of the dividend policy established
six quarters ago. Walter M. Pressey, President and CFO of Boston Private, said,
"We continue to add a number of attractive institutional holders to our base of
loyal, long-term private investors, some of whom continue to add shares to their
investment portfolios. We want to share our earnings growth success
appropriately with our investors while we continue to pursue our business
strategy." The record date for this dividend is November 1, 2001 and payment
date is expected to be November 30, 2001.
Strategic Direction
Boston Private continues to be very optimistic about the growth of the wealth
sector of the financial services marketplace as well as its own opportunities to
position the Company attractively therein. Several steps have already been taken
in 2001. In the first quarter, Boston Private completed the purchase of Boston
Private Value Investors, with offices in Concord, New Hampshire, and Boston.
This new firm will be part of the "cluster" of Boston Private wealth management
companies, which also includes Boston Private Bank, Westfield Capital
Management, and RINET Company, serving the New England region. It also acquired
Kanon Bloch Carre, which adds an independent mutual fund rating service to this
grouping.
In June, Boston Private announced a merger with Borel Bank & Trust Company,
located in San Mateo, California, which is expected to close in November. Borel
Bank will join Sand Hill Advisors, located in Menlo Park, California, as Boston
Private builds another cluster of wealth management companies, this time serving
the Northern California region. Boston Private expects that other capabilities,
including financial planning services, will be added to this region in the
future.
Says Vaill, "The combination of sophisticated financial planning, cash
management and credit availability through private banking, and a well-balanced
mix of investment management capabilities which offer individually-managed
accounts, strongly appeals to the high net worth marketplace. Further, our goal
is to deliver these services from a small platform on a local or regional basis.
Finally, we believe we can continue our proven record of superior shareholder
returns with this business model. Thus our strategy is to continue building
Boston Private in this vein."
Outlook for The Remainder 2001 and 2002
WHEN ASKED ABOUT FINANCIAL PROSPECTS FOR THE FUTURE, MR. VAILL SAID, "WE HAVE
CONSISTENTLY STATED THAT OUR GROWTH OBJECTIVES ARE TO ACHIEVE 15% TO 20%
INCREASE OF EARNINGS PER SHARE
ANNUALLY. FOR THE PAST FIVE YEARS WE HAVE ACHIEVED A COMPOUND ANNUAL GROWTH IN
EARNINGS IN EXCESS OF 20% PER YEAR. THIS YEAR, ALTHOUGH OUR YEAR OVER YEAR
GROWTH IN EARNINGS PER SHARE HAS BEEN 25% THROUGH THE FIRST NINE MONTHS, WE HAVE
BEEN CAUTIOUS BECAUSE OF THE DECLINING ECONOMY. IT NOW SEEMS RELATIVELY CLEAR
THAT, EXCLUDING TRANSACTION EXPENSES, WE WILL ACHIEVE A GROWTH RATE FOR THE FULL
YEAR THAT EXCEEDS THE HIGH END OF OUR OBJECTIVES RANGE. IN 2002, WE MUST
CONTINUE TO BE CAUTIOUS IN LIGHT OF THE CURRENT ECONOMIC ENVIRONMENT; HOWEVER,
OUR OBJECTIVE OF CONSISTENTLY ACHIEVING AT LEAST A 15% INCREASE IN EARNINGS PER
SHARE EACH YEAR REMAINS IN PLACE."
CONFERENCE CALL
Management also announced that it would hold a quarterly conference call to
review the Company's financial performance, business and prospects on Friday,
October 19 at 11:00 am eastern. Interested parties may join the call on by
dialing 1-800-540-0559. The password required is "Boston". The call will be
simultaneously web cast and may be accessed on the Internet by linking through,
WWW.BOSTONPRIVATE.COM, WWW.PRNEWSWIRE.COM , or Yahoo! Finance. A continuous
telephone replay will be available beginning Friday at 12:30 p.m. through
midnight, October 29, 2001. The replay telephone number is 888-566-0179.
GENERAL CORPORATE INFORMATION
BOSTON PRIVATE FINANCIAL HOLDINGS OFFERS A FULL RANGE OF FINANCIAL PLANNING,
INVESTMENT MANAGEMENT, AND PRIVATE BANKING SERVICES TO ITS DOMESTIC AND
INTERNATIONAL CLIENTELE THROUGH ITS FIVE OPERATING COMPANIES: BOSTON PRIVATE
BANK & TRUST COMPANY, WESTFIELD CAPITAL MANAGEMENT, RINET COMPANY, SAND HILL
ADVISORS, AND BOSTON PRIVATE VALUE INVESTORS.
BOSTON PRIVATE BANK & TRUST COMPANY specializes in providing private banking and
investment services to individuals, their families and businesses. It has an
investment management emphasis on mid- to large-cap equity and actively managed
fixed income portfolios. It also offers commercial and residential lending
services. Boston Private Bank & Trust Company also offers a First Time Homebuyer
Program and "soft second" mortgage financing. Under its Accessible Banking
Program, the Bank is an active provider of real estate financing for affordable
housing, economic development and small businesses.
WESTFIELD CAPITAL MANAGEMENT, whose clients consist of high net worth
individuals, corporate pension funds, endowments and foundations, specializes in
separately managed growth equity portfolios. Westfield also acts as the
investment manager of seven limited partnerships. Its investment services
include a particular focus on identifying and managing small and mid-cap equity
positions as well as balanced growth accounts.
RINET COMPANY provides fee-only financial planning, tax planning and investment
management services to high net worth individuals and their families. Its
capabilities include tax
planning and preparation, asset allocation, estate planning, charitable
planning, planning for employment benefits, including 401(k) plans, alternative
investment analysis and mutual fund investing. It also provides an independent
mutual fund rating service through its newly acquired division, Kanon Bloch
Carre.
SAND HILL ADVISORS manages equity and fixed income accounts for high net worth
clients and selected institutions primarily in California. In addition to
separately managed relationships, Sand Hill manages a no-load mutual fund and
uses its expertise to plan and execute diversification programs for concentrated
stock positions.
BOSTON PRIVATE VALUE INVESTORS manages equity and fixed income accounts for high
net worth clients and selected institutions primarily in New England and the
North East. The firm is a large-cap value-style investor with its headquarters
in Concord, NH and an office at 10 Post Office Square in Boston, MA.
THIS NEWS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995, INCLUDING, WITHOUT LIMITATION,
SUCH STATEMENTS AS MAY BE IDENTIFIED BY WORDS SUCH AS "BELIEVES," "EXPECTS,"
"WILL," "ANTICIPATES," "ESTIMATES," "ATTAIN," "INTENDS," "PLANS," "CONTINUE,"
"GOAL," OBJECTIVES," AND SIMILAR EXPRESSIONS. THESE STATEMENTS INCLUDE
STATEMENTS REGARDING: (1) BOSTON PRIVATE'S OUTLOOK ON FUTURE MARKET PERFORMANCE,
(2) CONTINUATION OF SUPERIOR SHAREHOLDER RETURNS, AND (3) BOSTON PRIVATE'S
EXPECTATIONS REGARDING 2001 AND 2002 RESULTS OF OPERATIONS. THESE STATEMENTS ARE
BASED UPON THE CURRENT BELIEFS AND EXPECTATIONS OF BOSTON PRIVATE'S MANAGEMENT
AND ARE SUBJECT TO SIGNIFICANT RISKS AND UNCERTAINTIES. ACTUAL RESULTS MAY
DIFFER FROM THOSE SET FORTH IN THE FORWARD-LOOKING STATEMENTS.
THE FOLLOWING FACTORS, AMONG OTHERS, COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THE ANTICIPATED RESULTS OR OTHER EXPECTATIONS EXPRESSED IN SUCH
FORWARD-LOOKING STATEMENTS: (1) THE RISK THAT THE BUSINESS OF BOREL WILL NOT BE
INTEGRATED SUCCESSFULLY WITH BOSTON PRIVATE'S OR SUCH INTEGRATION MAY BE MORE
DIFFICULT, TIME-CONSUMING OR COSTLY THAN EXPECTED; (2) THE RISK THAT THE PENDING
BOREL ACQUISITION IS NOT CONSUMMATED IN A TIMELY FASHION, OR AT ALL, FOR ANY
REASON; (3) ENACTMENT OF ADVERSE GOVERNMENT REGULATION; (4) COMPETITIVE
PRESSURES AMONG DEPOSITORY AND OTHER FINANCIAL INSTITUTIONS MAY INCREASE
SIGNIFICANTLY AND HAVE AN EFFECT ON PRICING, SPENDING, THIRD-PARTY RELATIONSHIPS
AND REVENUES; (5) THE STRENGTH OF THE UNITED STATES ECONOMY IN GENERAL AND
SPECIFICALLY THE STRENGTH OF THE NEW ENGLAND, CALIFORNIA AND OTHER ECONOMIES IN
WHICH BOSTON PRIVATE OPERATES OR WILL BE OPERATING, INCLUDING AS A RESULT OF
RECENT ECONOMIC UNCERTAINTY CREATED BY THE SEPTEMBER 11, 2001 TERRORIST ATTACKS
ON THE WORLD TRADE CENTER AND THE PENTAGON, THE UNITED STATES' WAR ON TERRORISM,
MAY BE DIFFERENT THAN EXPECTED RESULTING IN, AMONG OTHER THINGS, A DETERIORATION
IN OVERALL CREDIT QUALITY AND BORROWERS' ABILITY TO SERVICE AND REPAY LOANS, OR
A REDUCED DEMAND FOR CREDIT, INCLUDING THE RESULTANT EFFECT ON THE COMBINED
COMPANY'S LOAN PORTFOLIO, LEVELS OF CHARGE-OFFS AND NON-PERFORMING LOANS AND
ALLOWANCE FOR LOAN LOSSES, AND REDUCED DEMAND FOR WEALTH MANAGEMENT SERVICES;
(6) CHANGES IN THE INTEREST RATE ENVIRONMENT MAY REDUCE INTEREST MARGINS AND
ADVERSELY IMPACT NET INTEREST INCOME; AND (7) ADVERSE CONDITIONS AND VOLATILITY
IN THE STOCK MARKET, THE PUBLIC DEBT MARKET AND OTHER CAPITAL MARKETS AND THE
IMPACT OF SUCH CONDITIONS ON BOSTON PRIVATE'S ASSET MANAGEMENT ACTIVITIES AND
FEES FROM SUCH ACTIVITIES. ADDITIONAL FACTORS THAT COULD CAUSE BOSTON PRIVATE'S
RESULTS TO DIFFER MATERIALLY FROM THOSE DESCRIBED IN THE FORWARD-LOOKING
STATEMENTS CAN BE FOUND IN BOSTON PRIVATE'S OTHER PRESS RELEASES AND ANNUAL
REPORT ON FORM 10-K, QUARTERLY REPORTS ON FORM 10-Q, CURRENT REPORTS ON FORM 8-K
AND OTHER FILINGS SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION. BOSTON
PRIVATE DOES NOT UNDERTAKE ANY OBLIGATION TO UPDATE ANY FORWARD-LOOKING
STATEMENT TO REFLECT CIRCUMSTANCES OR EVENTS THAT OCCUR AFTER THE DATE THE
FORWARD-LOOKING STATEMENTS ARE MADE.
BOSTON PRIVATE FINANCIAL HOLDINGS, INC.
SELECTED FINANCIAL DATA
(UNAUDITED)
(Dollars In Thousands, Except Per Share Data)
SEPTEMBER 30, September 30, December 31,
2001 2000 % CHANGE 2000 % CHANGE
------------- ------------- -------- ------------- --------
FINANCIAL DATA:
Total Balance Sheet Assets $1,116,915 $853,997 30.8% $923,186 21.0%
Stockholders' Equity 114,209 94,643 20.7% 99,617 14.6%
Investment Securities 211,311 112,896 87.2% 178,152 18.6%
Commercial Loans 300,438 247,649 21.3% 271,784 10.5%
Residential Mortgage Loans 463,834 313,434 48.0% 345,643 34.2%
Home Equity and Other Loans 36,278 26,288 38.0% 27,646 31.2%
Total Loans 800,550 587,371 36.3% 645,073 24.1%
Allowance for Loan Losses 9,309 6,733 38.3% 7,342 26.8%
Nonperforming Loans 1,239 1,940 (36.1%) 1,303 (4.9%)
Other Real Estate Owned - - 0.0% - 0.0%
Nonperforming Assets 1,239 1,940 (36.1%) 1,303 (4.9%)
Deposits 797,111 648,815 22.9% 665,047 19.9%
Borrowings 175,917 93,932 87.3% 139,878 25.8%
Book Value Per Share $6.95 $5.85 18.8% $6.15 13.0%
Market Price Per Share $19.51 $16.50 18.2% $19.88 (1.9%)
ASSETS UNDER MANAGEMENT:
Westfield Capital Management $2,338,000 $2,457,000 (4.8%) $2,636,000 (11.3%)
Boston Private Bank & Trust 1,439,000 1,600,000 (10.1%) 1,601,000 (10.1%)
Sand Hill Advisors - Regular Accounts 532,000 $648,000 (17.9%) 598,000 (11.0%)
Sand Hill Advisors - Concentrated
Stock Portfolios 56,000 $608,000 (90.8%) 363,000 (84.6%)
Boston Private Value Investors 446,000 $535,000 (16.6%) 532,000 (16.2%)
RINET Company 501,000 477,000 5.0% 489,000 2.5%
Total Assets Under Management $5,312,000 $6,325,000 (16.0%) $6,219,000 (14.6%)
FINANCIAL RATIOS:
Stockholders' Equity/Total Assets 10.23% 11.08% (7.7%) 10.79% (5.2%)
Nonperforming Loans/Total Loans 0.15% 0.33% (54.5%) 0.20% (25.0%)
Allowance for Loan Losses/
Nonperforming Loans 751.33% 347.06% 116.5% 563.47% 33.3%
Nonperforming Assets/Total Assets 0.11% 0.23% (52.2%) 0.14% (21.4%)
NINE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30, September 30, SEPTEMBER 30, September 30,
2001 2000 % CHANGE 2001 2000 % CHANGE
------------- ------------- -------- ------------- ------------- --------
OPERATING RESULTS:
Net Interest Income $27,538 $17,535 57.0% $9,789 $6,428 52.3%
Investment Management Fees - Westfield
Capital Management 13,349 11,210 19.1% 4,288 4,164 3.0%
Investment Management Fees - Boston
Private Bank & Trust 7,107 6,956 2.2% 2,384 2,409 (1.0%)
Investment Management Fees - Sand
Hill Advisors 3,576 431 729.7% 1,174 431 172.4%
Investment Management Fees - Boston
Private Value Investors 2,989 3,156 (5.3%) 992 1,008 (1.6%)
------------- ------------- -------- ------------- ------------- --------
Total Investment Management Fees 27,021 21,753 24.2% 8,838 8,012 10.3%
Financial Planning Fees 3,195 2,585 23.6% 1,120 947 18.3%
Equity in Earnings of Partnerships (161) (203) (20.7%) (49) 38 (228.9%)
Gain on Sale of Loans 697 36 1836.1% 362 26 1292.3%
Gain on Sale of Investments 1,691 27 6163.0% 530 27 1863.0%
Cash Administration Fees 886 - NA 314 - NA
Other Fees 1,015 626 62.1% 464 231 100.9%
------------- ------------- -------- ------------- ------------- --------
Total Fees 34,344 24,824 38.3% 11,579 9,281 24.8%
------------- ------------- -------- ------------- ------------- --------
Total Revenue 61,882 42,359 46.1% 21,368 15,709 36.0%
Loan Loss Provision 1,900 1,300 46.2% 750 500 50.0%
Salaries and Benefits 29,548 21,066 40.3% 10,486 7,657 36.9%
Occupancy and Equipment 4,532 3,482 30.2% 1,512 1,225 23.4%
Professional Services 2,228 1,484 50.1% 598 671 (10.9%)
Marketing and Business Development 2,280 1,565 45.7% 627 477 31.4%
Contract Services and Processing 1,298 1,092 18.9% 349 374 (6.7%)
Amortization of Intangibles 1,034 437 136.6% 345 204 69.1%
Other 2,869 2,097 36.8% 1,063 815 30.4%
------------- ------------- -------- ------------- ------------- --------
Operating Expense 43,789 31,223 40.2% 14,980 11,423 31.1%
Merger Expense 139 - NA - - NA
------------- ------------- -------- ------------- ------------- --------
Income Before Tax 16,054 9,836 63.2% 5,638 3,786 48.9%
Income Tax Expense 4,713 3,004 56.9% 1,596 1,183 34.9%
------------- ------------- -------- ------------- ------------- --------
NET INCOME $11,341 $6,832 66.0% $4,042 $2,603 55.3%
============= ============= ======== ============= ============= ========
BOSTON PRIVATE FINANCIAL HOLDINGS, INC.
SELECTED FINANCIAL DATA
(UNAUDITED)
NINE MONTHS ENDED
SEPTEMBER 30, September 30,
2001 2000 % CHANGE
------------- ------------ --------
PER SHARE DATA:
Basic Earnings Per Share $0.69 $0.55 25.5%
Diluted Earnings Per Share $0.66 $0.53 24.5%
Average Common Shares Outstanding 16,354,511 12,418,254 31.7%
=========== =========== ====
Average Diluted Shares Outstanding 17,178,176 12,907,097 33.1%
=========== =========== ====
OPERATING RATIOS:
Return on Average Equity 14.13% 20.75% (31.9%)
Return on Average Assets 1.44% 1.34% 7.5%
Net Interest Margin 3.91% 3.76% 4.0%
Total Fees and Other Income/Total Revenue 55.50% 58.60% (5.3%)
Efficiency Ratio 70.76% 73.71% (4.0%)
NINE MONTHS ENDED
SEPTEMBER 30, September 30,
2001 2000 % CHANGE
------------- ------------- --------
AVERAGE BALANCE SHEET:
ASSETS:
Interest Bearing Cash $75,164 $41,215 82.4%
U.S. Treasuries and Agencies 77,982 47,665 63.6%
Municipal Securities 98,782 43,400 127.6%
Corporate Bonds 15,852 - NA
Mortgage-Backed Securities 2,924 4,473 (34.6%)
FHLB Stock 5,449 4,830 12.8%
Commercial Loans 283,624 208,782 35.8%
Residential Loans 395,895 263,281 50.4%
Home Equity and Other Loans 28,937 24,069 20.2%
---------- -------- -----
Total Earning Assets 984,609 637,715 54.4%
Allowance for Loan Losses (8,154) (5,905) 38.1%
Nonearning Assets 74,040 46,133 60.5%
---------- -------- -----
TOTAL ASSETS $1,050,495 $677,943 55.0%
========== ======== =====
LIABILITIES AND STOCKHOLDERS' EQUITY:
Savings Accounts $6,604 $4,953 33.3%
NOW Accounts 85,291 49,740 71.5%
Money Market Accounts 438,820 286,327 53.3%
Certificates of Deposit 134,391 102,526 31.1%
---------- -------- -----
Total Interest-Bearing Deposits 665,106 443,546 50.0%
Federal Funds Purchased 172 182 (5.5%)
Repurchase Agreements 48,888 28,205 73.3%
FHLB Borrowings 107,117 75,982 41.0%
---------- -------- -----
Total Interest-Bearing Liabilities 821,283 547,915 49.9%
Noninterest-Bearing Deposits 103,819 76,846 35.1%
Other Liabilities 18,409 9,284 98.3%
---------- -------- -----
Total Liabilities 943,511 634,045 48.8%
Stockholders' Equity 106,984 43,899 143.7%
---------- -------- -----
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $1,050,495 $677,944 55.0%
THREE MONTHS ENDED
SEPTEMBER 30, September 30,
2001 2000 % CHANGE
------------- -------------- --------
PER SHARE DATA:
Basic Earnings Per Share $0.25 $0.21 19.0%
Diluted Earnings Per Share $0.23 $0.20 15.0%
Average Common Shares Outstanding 16,419,765 12,601,624 30.3%
========== ========== ======
Average Diluted Shares Outstanding 17,275,134 13,211,612 30.8%
========== ========== ======
OPERATING RATIOS:
Return on Average Equity 14.53% 20.14% (27.9%)
Return on Average Assets 1.45% 1.38% 5.1%
Net Interest Margin 3.86% 3.75% 2.9%
Total Fees and Other Income/Total Revenue 54.19% 59.08% (8.3%)
Efficiency Ratio 70.10% 72.72% (3.6%)
THREE MONTHS ENDED
SEPTEMBER 30, September 30,
2001 2000 % CHANGE
------------- -------------- --------
AVERAGE BALANCE SHEET:
ASSETS:
Interest Bearing Cash $67,171 $44,552 50.8%
U.S. Treasuries and Agencies 81,509 55,739 46.2%
Municipal Securities 94,899 48,416 96.0%
Corporate Bonds 23,676 - NA
Mortgage-Backed Securities 2,680 3,844 (30.3%)
FHLB Stock 5,776 4,830 19.6%
Commercial Loans 298,370 227,987 30.9%
Residential Loans 444,508 294,481 50.9%
Home Equity and Other Loans 31,755 23,952 32.6%
---------- --------- ------
Total Earning Assets 1,050,344 703,801 49.2%
Allowance for Loan Losses (8,774) (6,387) 37.4%
Nonearning Assets 75,673 55,403 36.6%
---------- --------- ------
TOTAL ASSETS $1,117,243 $752,817 48.4%
========== ========= ======
LIABILITIES AND STOCKHOLDERS' EQUITY:
Savings Accounts $7,289 $5,937 22.8%
NOW Accounts 89,502 56,092 59.6%
Money Market Accounts 463,649 312,143 48.5%
Certificates of Deposit 145,903 122,186 19.4%
---------- --------- ------
Total Interest-Bearing Deposits 706,343 496,358 42.3%
Federal Funds Purchased 511 NA NA
Repurchase Agreements 58,614 30,818 90.2%
FHLB Borrowings 114,195 74,827 52.6%
---------- --------- ------
Total Interest-Bearing Liabilities 879,663 602,003 46.1%
Noninterest-Bearing Deposits 105,859 91,542 15.6%
Other Liabilities 20,459 7,579 169.9%
---------- --------- ------
Total Liabilities 1,005,981 701,124 43.5%
Stockholders' Equity 111,262 51,693 115.2%
---------- --------- ------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $1,117,243 $752,817 48.4%
========== ========= ======
BOSTON PRIVATE FINANCIAL HOLDINGS, INC.
SELECTED FINANCIAL DATA
(UNAUDITED)
SEPTEMBER 30, June 30,
2001 2001 % CHANGE
------------- --------- --------
FINANCIAL DATA:
Total Balance Sheet Assets $1,116,915 $1,106,987 0.9%
Stockholders' Equity 114,209 108,360 5.4%
Investment Securities 211,311 194,412 8.7%
Commercial Loans 300,438 296,543 1.3%
Residential Mortgage Loans 463,834 413,341 12.2%
Home Equity and Other Loans 36,278 29,058 24.8%
Total Loans 800,550 738,942 8.3%
Allowance for Loan Losses 9,309 8,521 9.2%
Nonperforming Loans 1,239 1,086 14.1%
Other Real Estate Owned - - 0.0%
Nonperforming Assets 1,239 1,086 14.1%
Deposits 797,111 812,192 (1.9%)
Borrowings 175,917 161,280 9.1%
Book Value Per Share $6.95 $6.60 5.3%
Market Price Per Share $19.51 $22.40 (12.9%)
ASSETS UNDER MANAGEMENT:
Westfield Capital Management $2,338,000 $2,893,000 (19.2%)
Boston Private Bank & Trust 1,439,000 1,524,000 (5.6%)
Sand Hill Advisors - Regular Accounts 532,000 $570,000 (6.7%)
Sand Hill Advisors - Concentrated Stock
Portfolios 56,000 $214,000 (73.8%)
Boston Private Value Investors 446,000 $515,000 (13.4%)
RINET Company 501,000 511,000 (2.0%)
Total Assets Under Management $5,312,000 $6,227,000 (14.7%)
FINANCIAL RATIOS:
Stockholders' Equity/Total Assets 10.23% 9.79% 4.5%
Nonperforming Loans/Total Loans 0.15% 0.15% 0.0%
Allowance for Loan Losses/
Nonperforming Loans 751.33% 784.62% (4.2%)
Nonperforming Assets/Total Assets 0.11% 0.10% 10.0%
THREE MONTHS ENDED
SEPTEMBER 30, June 30,
2001 2001 % CHANGE
------------- ---------- ---------
OPERATING RESULTS:
Net Interest Income $9,789 $9,129 7.2%
Investment Management Fees - Westfield
Capital Management 4,288 4,761 (9.9%)
Investment Management Fees - Boston
Private Bank & Trust 2,384 2,257 5.6%
Investment Management Fees - Sand
Hill Advisors 1,174 1,138 3.2%
Investment Management Fees - Boston
Private Value Investors 992 966 2.7%
------- ------- ------
Total Investment Management Fees 8,838 9,122 (3.1%)
Financial Planning Fees 1,120 989 13.2%
Equity in Earnings of Partnerships (49) (26) 88.5%
Gain on Sale of Loans 362 151 139.7%
Gain on Sale of Investments 530 670 (20.9%)
Cash Administration Fees 314 489 (35.8%)
Other Fees 464 316 46.8%
------- ------- ------
Total Fees 11,579 11,711 (1.1%)
------- ------- ------
Total Revenue 21,368 20,840 2.5%
Loan Loss Provision 750 600 25.0%
Salaries and Benefits 10,486 9,440 11.1%
Occupancy and Equipment 1,512 1,585 (4.6%)
Professional Services 598 884 (32.4%)
Marketing and Business Development 627 1,075 (41.7%)
Contract Services and Processing 349 590 (40.8%)
Amortization of Intangibles 345 344 0.3%
Other 1,063 860 23.6%
------- ------- ------
Operating Expense 14,980 14,778 1.4%
Merger Expense - 12 (100.0%)
------- ------- ------
Income Before Tax 5,638 5,449 3.5%
Income Tax Expense 1,596 1,693 (5.7%)
------- ------- ------
NET INCOME $4,042 $3,756 7.6%
======= ======= ======
PER SHARE DATA:
Basic Earnings Per Share $0.25 $0.23 8.7%
Diluted Earnings Per Share $0.23 $0.22 4.5%
Average Common Shares Outstanding 16,419,765 16,369,371 0.3%
========== ========== ======
Average Diluted Shares Outstanding 17,275,134 17,195,666 0.5%
========== ========== ======
OPERATING RATIOS:
Return on Average Equity 14.53% 14.05% 3.4%
Return on Average Assets 1.45% 1.45% 0.0%
Net Interest Margin 3.86% 3.95% (2.3%)
Total Fees and Other Income/Total Revenue 54.19% 56.19% (3.6%)
Efficiency Ratio 70.10% 71.31% (1.7%)