Bank of Marin Bancorp, parent company of Bank of Marin, announced earnings of $5.7 million in the fourth quarter of 2016.
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This is compared to $7 million in the third quarter of 2016 and $4.9 million in the fourth quarter of 2015.
Diluted earnings per share were $0.93 in the fourth quarter of 2016, compared to $1.14 in the prior quarter and $0.81 in the same quarter a year ago. Annual earnings increased 25.4% to $23.1 million in 2016 from $18.4 million a year ago.
Diluted earnings per share were $3.78 for the year ended December 31, 2016, compared to $3.04 per share for the year ended December 31, 2015.
For the year ended December 31, 2016:
Gross loans increased by $35.4 million for the year and totaled $1,486.6 million at December 31, 2016, compared to $1,451.2 million at December 31, 2015. New loan volume of approximately $62 million for the fourth quarter was higher than each of the three prior quarters and totaled $192 million for the year.
Additionally, we entered 2017 with a strong loan pipeline that reflects the success of our lending team to expand existing markets and build new relationships.
Total deposits grew $44.5 million, or 2.6%, to $1,772.7 million at December 31, 2016 from $1,728.2 million last year. The Bank added several significant new commercial deposit relationships in 2016 while maintaining its low cost of funding. Non-interest bearing deposits grew by $46.9 million and make up 46% of total deposits.
Strong credit quality remains the hallmark of the Bank's culture. Non-accrual loans represent 0.01% of the Bank's loan portfolio as of December 31, 2016, down from 0.15% a year ago.
The resolution and payoff of several problem loans resulted in a $2.0 million decrease in non-accrual loans from $2.2 million at December 31, 2015 to $145 thousand at December 31, 2016.
The improvement in credit quality and a $2.6 million recovery of a commercial real estate credit in the third quarter resulted in a $1.9 million reversal of provision for loan losses in 2016.
Diligent expense management in 2016 improved the efficiency ratio from 61.5% in 2015 to 57.9% this year. Record earnings resulted in a return on assets ("ROA") of 1.15% for the year ended December 31, 2016, and return on equity ("ROE") of 10.23%.
All capital ratios are well above regulatory requirements for a well-capitalized institution. The total risk-based capital ratio for Bancorp was 14.3% at December 31, 2016 compared to 13.4% at December 31, 2015.
Tangible common equity to tangible assets (refer to footnote 3 on page 5 for definition of this non-GAAP financial measure) increased to 11.0% at December 31, 2016, from 10.1% at December 31, 2015.
The Board of Directors declared a cash dividend of $0.27 per share on January 20, 2017. This represents the 47th consecutive quarterly dividend paid by Bank of Marin Bancorp.
The cash dividend is payable on February 10, 2017, to shareholders of record at the close of business on February 3, 2017. ■