Berkshire Hills Bancorp yesterday announced fourth quarter 2020 net income of $15 million, or $0.30 per share, compared to $21 million, or $0.42 per share, in the prior quarter
The fourth quarter non-GAAP measure of core earnings totaled $14 million, or $0.28 per share, compared to $26 million, or $0.53 per share, in the prior quarter.
The change in earnings is primarily due to pandemic related impacts, including a $9 million increase in the noncash provision for expected credit losses.
Acting CEO and President Sean Gray stated, "Fourth quarter results declined primarily due to higher noncash provisioning for expected credit losses reflecting the persistence of pandemic impacts on economic activity.
"These impacts also contributed to lower operating revenue and higher operating expenses.
"In this environment, the Bank adhered to its financial and operating disciplines.
"Higher net charge-offs were primarily due to four hospitality relationships, including credits which were exited during the quarter.
"Total criticized loans decreased, along with loans with payment deferrals.
"The net interest margin was supported by a reduction in funding costs.
"We managed down our staffing, as well as occupancy, and technology costs.
"We continue to adjust operations to protect employees, customers and communities, including moving branch lobbies back to appointment-only access based on local conditions.
"Management's actions are targeted to position the Bank for improved results as public health and economic conditions improve."
Mr. Gray continued, "We recently announced important strategic initiatives, starting with our best of breed digital account opening platform.
"We've made the right technology investments to support customer preferences for electronic banking.
"Consistent with these shifts, we announced the planned consolidation of 16 branches in the first half of 2021.
"With the concierge banking offered by our growing team of MyBankers, we expect to smoothly transition customers to nearby branches.
"Separately, we entered into an agreement to sell our eight mid-Atlantic branches and we are opening a new Providence commercial banking office.
"When these initiatives are completed, we plan to have 106 branch offices located primarily in southern New England and eastern/central New York.
"These actions are targeted to focus and deepen meaningful engagement with our communities as a 21st century purpose-driven community bank that helps everyone access the services they need to live healthier financial lives." ■