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Berkshire Hills Bancorp Q4 EPS increased by 40%

Christian Fernsby |
Berkshire Hills Bancorp reported that fourth quarter earnings per share (EPS) increased year-over-year by 40% to $0.42 in 2021, and by 50% to $0.42 on an adjusted non-GAAP basis.

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For the year 2021, Berkshire reported EPS of $2.39, or $1.69 on an adjusted basis, compared to a 2020 loss of ($10.60), or a $0.60 profit, on an adjusted basis.

Fourth quarter GAAP earnings per share increased to $0.42 in 2021 from $0.30 in 2020, and decreased from $1.31 in the third quarter of 2021.

Berkshire's non-GAAP measure of fourth quarter adjusted EPS was also $0.42 in 2021, which was a 504% increase year-over-year primarily due to a benefit to the loan loss provision reflecting improved credit performance in 2021.

Adjusted EPS decreased 21% quarter-over-quarter reflecting changes in revenue mix as the Company is investing in new revenue generating sources targeted to benefit future periods.

Fourth quarter return on equity increased year-over-year to 6.9% in 2021, and adjusted return on tangible common equity improved to 7.3%. These results included the benefit of the repurchase of 5% of outstanding shares during 2021.

Fourth quarter revenue decreased year-over-year and quarter-over-quarter reflecting low interest rates and constrained customer demand during the ongoing pandemic.

By accumulating lower yielding short term investments, the Company accepted lower 2021 revenues and is positioned to benefit from projected stronger loan demand and higher interest rates in 2022.

Fourth quarter net interest income decreased 8% year-over-year and 3% quarter-over-quarter, reflecting both volume and margin changes, as well as the sale of the Company's Mid-Atlantic branch operations.

The fourth quarter 2021 net interest margin was 2.60%, compared to 2.56% in the linked quarter, and reflected the benefit of the reduction in higher cost wholesale funding and the roll-down in the cost of maturing retail time deposits.

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