United Financial Announces Q1 Earnings, Dividend

GLASTONBURY, Conn. — United Financial Bancorp Inc., the holding company for United Bank, announced results for the quarter ended March 31.

The company had net income of $11.9 million, or $0.24 per diluted share, for the quarter ended March 31, compared to net income for the linked quarter of $9.9 million, or $0.20 per diluted share. Operating net income (Non-GAAP) for the first quarter of 2016 was $10.9 million, or $0.22 per diluted share, compared to $11.3 million, or $0.23 per diluted share for the linked quarter. Operating net income is adjusted for purchase accounting impacts and net gain on sale of securities. Additionally, in the first quarter of 2016, operating income was also adjusted for Federal Home Loan Bank of Boston (“FHLBB”) prepayment penalties. The company reported net income of $13.0 million, or $0.26 per diluted share, for the quarter ended March 31, 2015.

“In the first quarter of 2016, linked quarter annualized growth included a 13% increase in demand deposits, 9% growth in total deposits, and a seven-basis-point expansion in the net interest margin. Non-interest expense to average assets declined to 2.03% on an operating basis and asset quality remained excellent. Tangible book value increased by 5% compared to the linked quarter (annualized) as we announced our 40th consecutive dividend payment,” said William H. W. Crawford, IV, CEO of the company and the bank. “Given the interest rate environment, we believe execution on the aforementioned key variables give us the best opportunity to continue building long term shareholder value.

“While volatile interest rates reduced mortgage banking income and headline Company profitability in the first quarter of 2016, management is focused on growing revenue centered in net interest income and core fee income,” he went on. “I remain bullish on United Financial Bancorp Inc.’s outlook for 2016 earnings and tangible book value growth.”

The report’s financial highlights include:

• Return on average assets (ROA) of 0.76%;
• Return on average equity (ROE) of 7.59%;
• Net interest margin (NIM) increased to 3.09% from 3.02% in the linked quarter;
• Operating non-interest expense/average assets (NIE/AA) of 2.03% for the quarter (annualized) balance sheet;
• 
Total assets at March 31, 2016 increased by $90.7 million to $6.3 billion from $6.2 billion at Dec. 31, 2015;
• At March 31, 2016, total loans were $4.6 billion, representing an increase of $34.9 million from the linked quarter;
• Despite the typical softness experienced in the first quarter in general, total commercial loans increased by $38.5 million, or 6% annualized;
• Residential mortgages declined during the first quarter of 2016 by $3.6 million, reflecting the company’s strategy to reduce on-balance sheet exposure to residential mortgage loans.