Bridgewater Bank Annual Report

2017 Compared to 2016 The allowance for loan losses increased $4.2 million as of December 31, 2017, compared to December 31, 2016, reflecting a provision for loan losses of $4.2 million and net charge-offs of $6,000 during 2017. The provision for loan losses was $4.2 million for the year ended December 31, 2017, an increase of $925,000, compared to the provision for loan losses of $3.3 million for the year ended December 31, 2016, due primarily to growth in the loan portfolio. The allowance for loan losses at December 31, 2017 represented 1.22% of loans outstanding, compared to 1.23% at December 31, 2016. The following table presents a summary of the activity in the allowance for loan losses for the years ended December 31, 2018, 2017, and 2016: 2016 Balance at Beginning of Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 16,502 $ 12,333 $ 10,052 Provision for Loan Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,575 4,175 3,250 Charge-offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (421) (177) (1,114) Recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 375 171 145 Balance at End of Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20,031 $ 16,502 $ 12,333 Year Ended December 31, (dollars in thousands) 2018 2017 Noninterest income was $2.5 million for the years ended December 31, 2018 and 2017, an increase of $7,000. The marginal increase was largely due to increased fees related to customer deposit accounts as a result of the overall increase in the number of our deposit clients, increased fees earned for letters of credit due to increased volume, and a decrease in losses on sales of securities. This activity was offset by an increased loss on sales of foreclosed assets. 2017 Compared to 2016 Noninterest income was $2.5 million and $2.6 million for the years ended December 31, 2017 and 2016, a decrease of $31,000. The marginal decrease was due to the company realizing a net loss of $250,000 on sales of investment securities in 2017 compared to a net gain of $830,000 in 2016. This was offset in part by increased gains on the sale of foreclosed assets of $386,000 and increased letter of credit fees of $230,000. Increased fees related to customer deposit accounts were due to an overall increase in the number of our deposit clients. Noninterest Income 2018 Compared to 2017

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