Press Release

Cambridge Bancorp Announces Record Quarterly Earnings and Declares Dividend

Company Release - 10/15/2018 5:20 PM ET

CAMBRIDGE, Mass., Oct. 15, 2018 /PRNewswire/ -- Cambridge Bancorp (NASDAQ: CATC) (the "Company"), the parent of Cambridge Trust Company, today announced unaudited net income of $6,659,000 for the quarter ended September 30, 2018, representing an increase of $1,649,000, or 32.9%, compared to net income of $5,010,000 for the quarter ended September 30, 2017. Income before income taxes was $8,764,000 for the quarter ended September 30, 2018, representing an increase of $1,060,000, or 13.8%, compared to $7,704,000 for the same quarter of last year. Diluted earnings per share were $1.61 for the third quarter of 2018, representing a 32.0% increase over diluted earnings per share of $1.22 for the same quarter of 2017.

(PRNewsfoto/Cambridge Bancorp)

For the nine months ended September 30, 2018, unaudited net income was $18,575,000, representing an increase of $4,723,000, or 34.1%, compared to net income of $13,852,000 for the nine months ended September 30, 2017. Income before income taxes was $24,197,000 for the nine months ended September 30, 2018, representing an increase of $3,358,000, or 16.1%, compared to $20,839,000 for the same period of last year. Diluted earnings per share were $4.49 for the first nine months of 2018, representing a 33.2% increase over diluted earnings per share of $3.37 for the same nine months of 2017.

Third quarter 2018 highlights as compared to the third quarter of 2017:

  • Wealth Management Assets under Management and Administration total $3.2 billion, an increase of 8.1%
  • Revenue of $25.1 million, an increase of 11.0%
  • Loan growth of $95.9 million, or 7.1%

"We are pleased to report that the Company continues to experience strong performance," noted Denis K. Sheahan, Chairman and CEO. "Cambridge Bancorp posted robust profitability metrics for the quarter with annualized return on average assets of 1.33% and annualized return on average shareholders' equity of 16.71%. Our earnings performance was driven by a sustained trend in loan growth, which has increased $95.9 million from the same quarter end of 2017. We have additionally focused on growth in noninterest income businesses, leading to an increase in income before income taxes of 16.1% for the nine months ended September 30, 2018 as compared to the same period a year ago."

Balance Sheet

Total assets increased $39.0 million, or 2.0%, from December 31, 2017 and were $2.0 billion as of September 30, 2018.

Total loans increased $100.9 million, or 7.5%, from December 31, 2017 and stood at $1.5 billion as of September 30, 2018. The growth in total loans was due to net loan growth in the commercial real estate, residential real estate, and commercial & industrial portfolios. Commercial real estate loans increased $54.9 million, from $633.6 million at December 31, 2017 to $688.5 million at September 30, 2018. Residential real estate loans increased $34.6 million, from $538.9 million at December 31, 2017 to $573.5 million at September 30, 2018. Commercial & industrial loans increased $16.9 million, from $65.3 million at December 31, 2017 to $82.2 million at September 30, 2018.

The Company's total investment securities portfolio increased by $14.2 million, or 3.2%, from $437.2 million at December 31, 2017 to $451.4 million at September 30, 2018.

Core deposits, which the Company defines as all deposits other than certificates of deposit, increased by $2.1 million from December 31, 2017. The cost of total deposits for the quarter ended September 30, 2018 was 0.29%, as compared to 0.19% for the quarter ended September 30, 2017. The cost of total deposits for the nine months ended September 30, 2018 was 0.25%, as compared to 0.18% for the nine months ended September 30, 2017. Total deposits at September 30, 2018 were $1.7 billion.

Short term borrowings increased from $0 at December 31, 2017 to $66.7 million at September 30, 2018 as the Company funded strong loan growth during the year.

Net Interest and Dividend Income

For the quarter ended September 30, 2018, net interest and dividend income after provision for loan losses increased by $1.4 million, or 9.7%, to $15.7 million, as compared to $14.3 million for the quarter ended September 30, 2017. Interest on loans increased by $1.7 million, or 13.2%, which was driven by a combination of the impact of rising rates on our loan portfolio and net loan growth. The Company's net interest margin, on a fully taxable equivalent basis, increased 12 basis points to 3.35% for the quarter ended September 30, 2018, as compared to 3.23% for the quarter ended September 30, 2017.

For the nine months ended September 30, 2018, net interest and dividend income after provision for loan losses increased by $3.9 million, or 9.2%, to $46.4 million, as compared to $42.5 million for the nine months ended September 30, 2017. Interest on loans increased by $4.2 million, or 11.1%, which was driven by a combination of the impact of rising rates on our loan portfolio and net loan growth. The Company's net interest margin, on a fully taxable equivalent basis, increased nine basis points to 3.33% for the nine months ended September 30, 2018, as compared to 3.24% for the nine months ended September 30, 2017.

Noninterest Income

Total noninterest income increased by $952,000, or 11.9%, to $8.9 million for the quarter ended September 30, 2018, as compared to $8.0 million for the quarter ended September 30, 2017, primarily as a result of higher Wealth Management revenue and higher loan related derivative income associated with the Company's interest rate risk strategy. Noninterest income was 35.6% of total revenue for the quarter ended September 30, 2018. Wealth Management revenue increased by $648,000, or 10.6%, for the third quarter of 2018, as compared to the third quarter of 2017, primarily due to market appreciation. Wealth Management Assets under Management and Administration increased by $85.8 million from December 31, 2017 to $3.2 billion as of September 30, 2018. Loan related derivative income increased $352,000 for the third quarter of 2018, as compared to the third quarter of 2017, due to the volume of derivative transactions executed in the third quarter of 2018.

Total noninterest income increased by $2.3 million, or 10.2%, to $25.0 million for the nine months ended September 30, 2018, as compared to $22.6 million for the nine months ended September 30, 2017, primarily as a result of higher Wealth Management revenue and higher loan related derivative income. Noninterest income was 34.6% of total revenue for the nine months ended September 30, 2018. Wealth Management revenue increased by $2.0 million, or 11.5%, for the nine months ended September 30, 2018, primarily due to market appreciation. Loan related derivative income increased $573,000 for the nine months ended September 30, 2018, as compared to the nine months ended September 30, 2017, due to the volume of derivative transactions executed in 2018.

Noninterest income increases were partially offset by lower gains on loans held for sale of $242,000 for the nine months ended September 30, 2018, as compared to the nine months ended September 30, 2017.

Noninterest Expense

Total noninterest expense increased by $1.3 million, or 8.7%, to $15.9 million for the quarter ended September 30, 2018, as compared to $14.6 million for the quarter ended September 30, 2017, primarily driven by increased salaries and employee benefits expense and marketing expense. The increase in salaries and employee benefits expense of $1.3 million was driven by the combination of increased staffing to support business initiatives, higher employee benefit costs including performance based equity compensation, and the current year adoption of accounting guidance ("ASU 2017-07") for net periodic pension costs and net periodic postretirement benefit costs. The 2018 adoption of ASU 2017-07 required that non-service related pension expense and income items no longer be included in salaries and employee benefits in the Company's income statement. The non-service related pension expense and income items are instead included in other expenses. Previously reported salaries and employee benefits and other expenses have been restated to reflect the retrospective adoption. The amount added to salaries and employee benefits and deducted from other expenses from the adoption of ASU 2017-07 during the quarter ended September 30, 2018 was approximately $225,000. The retrospective application for the quarter ended September 30, 2017 was a decrease in salaries and employee benefits and an increase in other expenses of approximately $66,000. The increase of $240,000 in marketing expense was due to the increased focus of growing brand awareness within our markets.

Noninterest expense increases were partially offset by lower other expenses of $243,000 resulting from the adoption of ASU 2017-07 as discussed above and lower professional services of $193,000 for the quarter ended September 30, 2018, as compared to September 30, 2017. 

Total noninterest expense increased by $2.9 million, or 6.5%, to $47.1 million for the nine months ended September 30, 2018, as compared to $44.3 million for the nine months ended September 30, 2017, primarily driven by increased salaries and employee benefits expense and marketing expense. The increase in salaries and employee benefits of $3.8 million was driven by the combination of increased staffing to support business initiatives, higher employee benefit costs including performance based equity compensation, and the adoption of ASU 2017-07. The amount added to salaries and employee benefits and deducted from other expenses from the adoption of ASU 2017-07 for the nine months ended September 30, 2018 was approximately $674,000. The retrospective application for the nine months ended September 30, 2017 was a decrease in salaries and employee benefits and an increase in other expenses of approximately $185,000. The increase of $271,000 in marketing expense was due to the increased focus of growing brand awareness within our markets.

Noninterest expense increases were partially offset by lower other expenses of $838,000 resulting from the adoption of ASU 2017-07 as discussed above and lower professional services of $173,000 for the nine months ended September 30, 2018, as compared to the nine months ended September 30, 2017. 

Asset Quality

Loan quality remained sound with non-performing loans totaling $807,000, or 0.06% of total loans outstanding as of September 30, 2018. The allowance for loan losses was $16.1 million, or 1.11% of total loans outstanding at September 30, 2018, compared to $15.3 million, or 1.13% of total loans outstanding at year end 2017.

Income Taxes

In accordance with the Tax Cuts and Jobs Act of 2017, the Company's federal statutory corporate tax rate decreased from 35% to 21% effective January 1, 2018. The effective tax rate was 24.0% for the quarter ended September 30, 2018, as compared to 35.0% for the quarter ended September 30, 2017. For the nine months ended September 30, 2018, the effective tax rate was 23.2%, as compared to 33.5% for the nine months ended September 30, 2017. Additionally, the Company recognized tax benefit from the accounting for share-based payments in the amount of $216,000 for the nine months ended September 30, 2018. 

Dividend

On October 15, 2018, the Company's Board of Directors declared a quarterly cash dividend of $0.50 per share, which is payable on November 15, 2018 to shareholders of record as of the close of business on November 1, 2018.

About Cambridge Bancorp

Cambridge Bancorp, the parent company of Cambridge Trust Company, is based in Cambridge, Massachusetts. Cambridge Trust Company is a 128-year-old Massachusetts chartered commercial bank with approximately $2.0 billion in assets and 10 Massachusetts locations in Cambridge, Boston, Belmont, Concord, Lexington, and Weston. Cambridge Trust Company is one of New England's leaders in private banking and wealth management with $3.2 billion in client assets under management and administration. The Wealth Management group maintains offices in Boston and Concord, Manchester and Portsmouth, New Hampshire.

The accompanying unaudited condensed interim and annual consolidated financial information should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K, which is posted in the investor relations section of the Company's website at www.cambridgetrust.com.

Forward-looking Statements

Certain statements herein may constitute "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements about the Company and its industry involve substantial risks and uncertainties. Statements other than statements of current or historical fact, including statements regarding the Company's future financial condition, results of operations, business plans, liquidity, cash flows, projected costs, and the impact of any laws or regulations applicable to the Company, are forward-looking statements. Words such as "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "plans," "projects," "may," "will," "should," and other similar expressions are intended to identify these forward-looking statements. Such statements are subject to factors that could cause actual results to differ materially from anticipated results. Such factors include, but are not limited to, the following: economic conditions being less favorable than expected, disruptions to the credit and financial markets, weakness in the real estate market, legislative, regulatory or accounting changes that adversely affect the Company's business and/or competitive position, the Dodd-Frank Act's consumer protection regulations, disruptions in the Company's ability to access the capital markets and other factors that are described in the Company's filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year end December 31, 2017, which the Company filed on March 21, 2018. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. You are cautioned not to place undue reliance on these forward-looking statements.

CONTACT:
Cambridge Bancorp
Michael F. Carotenuto
Chief Financial Officer
617-520-5520

 

CAMBRIDGE BANCORP AND SUBSIDIARIES

UNAUDITED QUARTERLY RESULTS

September 30, 2018




Three Months Ended



Nine Months Ended




September 30,



September 30,




2018



2017



2018



2017




(dollars in thousands, except per share data)



















Interest and Dividend Income


$

17,602



$

15,673



$

50,670



$

45,447


Interest Expense



1,431




1,034




3,492




2,617


  Net Interest and Dividend Income



16,171




14,639




47,178




42,830


Provision for Loan Losses



457




310




787




360


Noninterest Income



8,929




7,977




24,951




22,649


Noninterest Expense



15,879




14,602




47,145




44,280


  Income Before Income Taxes



8,764




7,704




24,197




20,839


Income Tax Expense



2,105




2,694




5,622




6,987


  Net Income


$

6,659



$

5,010



$

18,575



$

13,852



















Data Per Common Share:

















 Basic Earnings Per Share


$

1.62



$

1.23



$

4.53



$

3.40


 Diluted Earnings Per Share



1.61




1.22




4.49




3.37


 Dividends Declared Per Share



0.50




0.47




1.46




1.39



















 Avg. Common Shares Outstanding:

















   Basic



4,064,620




4,037,026




4,059,608




4,027,378


   Diluted



4,101,378




4,070,332




4,095,447




4,062,743



















Selected Operating Ratios:

















 Net Interest Margin, FTE



3.35

%



3.23

%



3.33

%



3.24

%

 Cost of Funds



0.29

%



0.22

%



0.24

%



0.19

%

 Cost of Interest Bearing Liabilities



0.45

%



0.33

%



0.37

%



0.28

%

 Cost of Deposits



0.29

%



0.19

%



0.25

%



0.18

%

 Return on Average Assets



1.33

%



1.05

%



1.26

%



0.99

%

 Return on Average Equity



16.71

%



13.84

%



16.21

%



13.25

%

 Efficiency Ratio



63.26

%



64.56

%



65.36

%



67.62

%
























September 30,



December 31,



September 30,








2018



2017



2017



















Total Assets






$

1,988,944



$

1,949,934



$

1,864,231


Total Loans







1,451,781




1,350,899




1,355,908


Non-Performing Loans







807




1,298




1,702


Allowance for Loan Losses







16,106




15,320




15,620


Allowance to Total Loans







1.11

%



1.13

%



1.15

%

Total Deposits







1,731,279




1,775,400




1,676,918


Total Shareholders' Equity







160,776




147,957




146,051


Total Shareholders' Equity to Total Assets







8.08

%



7.59

%



7.83

%

Wealth Management AUM







3,047,983




2,971,322




2,826,984


Wealth Management AUM & AUA







3,171,465




3,085,669




2,932,726


Book Value Per Share







39.16




36.24




35.78


 

 

CAMBRIDGE BANCORP AND SUBSIDIARIES

UNAUDITED CONSOLIDATED BALANCE SHEETS




September 30, 2018



December 31, 2017




(dollars in thousands, except par value)


Assets









Cash and cash equivalents


$

16,431



$

103,591


Investment securities









Available for sale, at fair value (amortized cost $186,715 and $208,911, respectively)



180,363




205,017


Held to maturity, at amortized cost (fair value $266,685 and $233,554, respectively)



271,005




232,188


Total investment securities



451,368




437,205


Loans held for sale, at lower of cost or fair value







Loans









Residential mortgage



573,525




538,920


Commercial mortgage



688,536




633,649


Home equity



70,173




74,444


Commercial & Industrial



82,243




65,295


Consumer



37,304




38,591


Total loans



1,451,781




1,350,899


Less: allowance for loan losses



(16,106)




(15,320)


Net loans



1,435,675




1,335,579


Federal Home Loan Bank of Boston Stock, at cost



6,666




4,242


Bank owned life insurance



30,800




31,083


Banking premises and equipment, net



8,836




9,310


Deferred income taxes, net



8,990




8,273


Accrued interest receivable



5,536




5,128


Other assets



24,642




15,523


Total assets


$

1,988,944



$

1,949,934


Liabilities









Deposits









Demand


$

505,951



$

493,613


Interest bearing checking



385,617




462,957


Money market



119,241




69,259


Savings



606,843




589,741


Certificates of deposit



113,627




159,830


Total deposits



1,731,279




1,775,400


Short-term borrowings



66,700





Long-term borrowings



3,452




3,579


Other liabilities



26,737




22,998


Total liabilities



1,828,168




1,801,977


Shareholders' Equity









Common stock, par value $1.00; Authorized 10,000,000 shares; Outstanding: 4,105,742

   shares and 4,082,188 shares, respectively



4,106




4,082


Additional paid-in capital



37,789




35,663


Retained earnings



127,883




114,093


Accumulated other comprehensive loss



(9,002)




(5,881)


Total shareholders' equity



160,776




147,957


Total liabilities and shareholders' equity


$

1,988,944



$

1,949,934


 

 

CAMBRIDGE BANCORP AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME




Three Months Ended
September
 30,



Nine Months Ended
September
 30,




2018



2017



2018



2017




(dollars in thousands, except share data)


Interest and dividend income

















Interest on taxable loans


$

14,808



$

13,038



$

42,318



$

37,966


Interest on tax-exempt loans



91




121




279




391


Interest on taxable investment securities



1,936




1,712




5,570




4,762


Interest on tax-exempt investment securities



591




641




1,817




1,966


Dividends on FHLB of Boston stock



93




107




202




192


Interest on overnight investments



83




54




484




170


Total interest and dividend income



17,602




15,673




50,670




45,447


Interest expense

















Interest on deposits



1,275




809




3,290




2,183


Interest on borrowed funds



156




225




202




434


Total interest expense



1,431




1,034




3,492




2,617


Net interest and dividend income



16,171




14,639




47,178




42,830


Provision for Loan Losses



457




310




787




360


Net interest and dividend income after provision for
   loan losses



15,714




14,329




46,391




42,470


Noninterest income

















Wealth management revenue



6,779




6,131




19,044




17,077


Deposit account fees



782




768




2,306




2,387


ATM/Debit card income



294




334




875




879


Bank owned life insurance income



129




139




393




448


Gain (loss) on disposition of investment securities









2




(3)


Gain on loans held for sale



37




39




82




324


Loan related derivative income



636




284




1,220




647


Other income



272




282




1,029




890


Total noninterest income



8,929




7,977




24,951




22,649


Noninterest expense

















Salaries and employee benefits



10,326




9,000




30,842




27,026


Occupancy and equipment



2,290




2,358




6,736




6,936


Data processing



1,329




1,111




3,848




3,830


Professional services



761




954




2,477




2,650


Marketing



595




355




1,369




1,098


FDIC Insurance



151




154




437




466


Other expenses



427




670




1,436




2,274


Total noninterest expense



15,879




14,602




47,145




44,280


Income before income taxes



8,764




7,704




24,197




20,839


Income tax expense



2,105




2,694




5,622




6,987


Net income


$

6,659



$

5,010



$

18,575



$

13,852


Share data:

















Weighted average number of shares outstanding, basic



4,064,620




4,037,026




4,059,608




4,027,378


Weighted average number of shares outstanding, diluted



4,101,378




4,070,332




4,095,447




4,062,743


Basic earnings per share


$

1.62



$

1.23



$

4.53



$

3.40


Diluted earnings per share


$

1.61



$

1.22



$

4.49



$

3.37


 

 


CAMBRIDGE BANCORP AND SUBSIDIARIES

MARGIN & YIELD ANALYSIS




Three Months Ended




September 30, 2018



September 30, 2017




Average

Balance



Interest

Income/

Expenses (1)



Rate

Earned/

Paid (1)



Average

Balance



Interest

Income/

Expenses (1)



Rate

Earned/

Paid (1)




(dollars in thousands)


ASSETS

























Interest-earning assets

























Loans (2)

























Taxable


$

1,417,426



$

14,808




4.14

%


$

1,330,390



$

13,038




3.89

%

Tax-exempt



9,855




116




4.67




14,950




186




4.94


Securities available for sale (3)

























Taxable



193,703




790




1.62




226,164




902




1.58


Securities held to maturity

























Taxable



199,841




1,146




2.28




154,129




810




2.08


Tax-exempt



76,030




749




3.91




80,717




986




4.85


Cash and due from banks



27,875




83




1.18




28,863




54




0.74


Total interest-earning assets (4)



1,924,730




17,692




3.65

%



1,835,213




15,976




3.45

%

Non interest-earning assets



74,738












75,753










Allowance for loan losses



(15,845)












(15,451)










Total assets


$

1,983,623











$

1,895,515










LIABILITIES AND SHAREHOLDERS' EQUITY

























Interest-bearing deposits

























Checking accounts


$

388,460



$

64




0.07

%


$

381,652



$

46




0.05

%

Savings accounts



618,021




707




0.45




573,332




376




0.26


Money market accounts



107,096




206




0.76




69,437




26




0.15


Certificates of deposit



123,900




298




0.95




164,547




361




0.87


Total interest-bearing deposits



1,237,477




1,275




0.41




1,188,968




809




0.27


Other borrowed funds



26,626




156




2.32




67,126




225




1.33


Total interest-bearing liabilities



1,264,103




1,431




0.45

%



1,256,094




1,034




0.33

%

Non-interest-bearing liabilities

























Demand deposits



535,777












470,016










Other liabilities



25,669












25,775










Total liabilities



1,825,549












1,751,885










Shareholders' equity



158,074












143,630










Total liabilities & shareholders' equity


$

1,983,623











$

1,895,515










Net interest income on a fully taxable equivalent basis







16,261












14,942






Less taxable equivalent adjustment







(183)












(410)






Net interest income






$

16,078











$

14,532






Net interest spread (5)











3.20

%











3.13

%

Net interest margin (6)











3.35

%











3.23

%



(1)

Annualized on a fully taxable equivalent basis calculated using a federal tax rate of 21% in 2018 and 35% in 2017.

(2)

Nonaccrual loans are included in average amounts outstanding.

(3)

Average balances of securities available for sale calculated utilizing amortized cost.

(4)

Federal Home Loan Bank stock balance and dividend income is excluded from interest-earning assets.

(5)

Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(6)

Net interest margin represents net interest income on a fully tax equivalent basis as a percentage of average interest-earning assets.

 

 

CAMBRIDGE BANCORP AND SUBSIDIARIES

MARGIN & YIELD ANALYSIS




Nine Months Ended



September 30, 2018


September 30, 2017



Average

Balance


Interest

Income/

Expenses (1)


Rate

Earned/

Paid (1)


Average

Balance


Interest

Income/

Expenses (1)


Rate

Earned/

Paid (1)



(dollars in thousands)

ASSETS













Interest-earning assets













Loans (2)













Taxable


$1,383,503


$42,318


4.09%


$1,312,432


$37,966


3.87%

Tax-exempt


10,279


354


4.60


15,917


601


5.05

Securities available for sale (3)













Taxable


200,259


2,449


1.64


261,106


3,158


1.62

Securities held to maturity













Taxable


187,167


3,121


2.23


101,819


1,604


2.11

Tax-exempt


77,458


2,300


3.97


82,023


3,024


4.93

Cash and due from banks


48,817


484


1.33


35,746


170


0.64

Total interest-earning assets (4)


1,907,483


51,026


3.58%


1,809,043


46,523


3.44%

Non interest-earning assets


71,539






73,733





Allowance for loan losses


(15,701)






(15,352)





Total assets


$1,963,321






$1,867,424





LIABILITIES AND SHAREHOLDERS' EQUITY













Interest-bearing deposits













Checking accounts


$414,691


$166


0.05%


$395,759


$84


0.03%

Savings accounts


620,036


1,907


0.41


557,442


951


0.23

Money market accounts


78,798


261


0.44


71,044


79


0.15

Certificates of deposit


139,683


956


0.92


168,136


1,069


0.85

Total interest-bearing deposits


1,253,208


3,290


0.35%


1,192,381


2,183


0.24%

Other borrowed funds


12,030


202


2.24


45,970


434


1.26

Total interest-bearing liabilities


1,265,238


3,492


0.37%


1,238,351


2,617


0.28%

Non-interest-bearing liabilities













Demand deposits


520,787






464,217





Other liabilities


24,123






25,032





Total liabilities


1,810,148






1,727,600





Shareholders' equity


153,173






139,824





Total liabilities & shareholders' equity


$1,963,321






$1,867,424





Net interest income on a fully taxable equivalent basis




47,534






43,906



Less taxable equivalent adjustment




(558)






(1,268)



Net interest income




$46,976






$42,638



Net interest spread (5)






3.21%






3.16%

Net interest margin (6)






3.33%






3.24%



(1)

Annualized on a fully taxable equivalent basis calculated using a federal tax rate of 21% in 2018 and 35% in 2017.

(2)

Nonaccrual loans are included in average amounts outstanding.

(3)

Average balances of securities available for sale calculated utilizing amortized cost.

(4)

Federal Home Loan Bank stock balance and dividend income is excluded from interest-earning assets.

(5)

Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(6)

Net interest margin represents net interest income on a fully tax equivalent basis as a percentage of average interest-earning assets.

 

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SOURCE Cambridge Bancorp