Item 5. Market for Registrant’s Common Equity
ITEM 5 MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information and Holders
Bancorp's common stock trades on the Nasdaq Capital Market under the symbol BMRC. At February 28, 2021, 13,359,479 shares of Bancorp's common stock, no par value, were outstanding and held by approxi mately 2,400 holders of record and beneficial owners. On October 22, 2018, Bancorp announced a two-for-one stock split, which occurred on November 27, 2018. All 2018 share and per share data have been adjusted to reflect the stock split.
Five-Year Stock Price Performance Graph
The following graph, compiled by S&P Global Market Intelligence of New York, New York, shows a comparison of cumulative total shareholder return on our common stock during the five fiscal years ended December 31, 2020 compared to the Russell 2000 Stock index and the SNL Bank $1B - $5B Index. The comparison assumes the investment of $100 in our common stock on December 31, 2015 and the reinvestment of all dividends. The graph represents past performance and does not indicate future performance. In addition, total return performance results vary depending on the length of the performance period.
2015 2016 2017 2018 2019 2020
Bank of Marin Bancorp (BMRC) 100.00 133.31 132.18 162.91 181.33 141.98
Russell 2000 Index 100.00 121.31 139.08 123.76 155.35 186.36
SNL Bank $1B - $5B Index 1
100.00 143.87 153.37 134.37 163.35 138.81
Source: S&P Global Market Intelligence
1 Includes all major exchange (NYSE, NYSE MKT, and Nasdaq) banks in S&P Global's coverage universe with $1 billion to $5 billion in assets as of the most recent available financial data.
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Shareholder Rights Agreement
On July 6, 2017, Bancorp executed a shareholder rights agreement (“Rights Agreement”), which is designed to discourage takeovers that involve abusive tactics or do not provide fair value to shareholders. For further information, see Note 8 to the Consolidated Financial Statements, under the heading “Preferred Stock and Shareholder Rights Plan” in ITEM 8 of this report.
Securities Authorized for Issuance under Equity Compensation Plans
The following table summarizes information as of December 31, 2020, with respect to equity compensation plans.
Shares to be issued upon exercise of outstanding options 1
Weighted average exercise price of outstanding options Shares remaining available for future issuance 2
Equity compensation plans approved by shareholders 371,584 $ 29.92 1,187,059
1 Represents shares of common stock issuable upon exercise of outstanding options under the Bank of Marin Bancorp 2017 Equity Plan and 2007 Equity Plan.
2 Represents remaining shares of common stock available for future grants under the 2017 Equity Plan and the 2020 Director Stock Plan, excluding 371,584 shares to be issued upon exercise of outstanding options and 380,123 shares available to be issued under the Employee Stock Purchase Plan.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
On April 23, 2018, Bancorp announced that its Board of Directors approved a Share Repurchase Program under which Bancorp may repurchase up to $25.0 million of its outstanding common stock through May 1, 2019. Bancorp's Board of Directors subsequently extended the Share Repurchase Program through February 28, 2020. A new Share Repurchase Program was approved by the Board of Directors on January 24, 2020, which began on March 1, 2020 and allows Bancorp to repurchase up to $25.0 million of its outstanding common stock through February 28, 2022. The new Share Repurchase Program was temporarily suspended on March 20, 2020 in response to the COVID-19 pandemic and reactivated on October 23, 2020.
Shares repurchased pursuant to our common stock share repurchase programs during 2020, 2019, and 2018, were as follows.
2020 2019 2018 Cumulative Totals
Total number of common shares repurchased 203,709 356,000 171,217 730,926
Total purchase price of common shares repurchased (in millions) $ 7.2 $ 15.0 $ 7.0 $ 29.2
The following table reflects purchases under the Share Repurchase Program for the months presented in 2020. For further information, see Note 8 to the Consolidated Financial Statements, under the heading “Share Repurchase Program” in ITEM 8 of this report.
(in thousands, except per share data) Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Programs Approximate Dollar Value That May yet Be Purchased Under the Program 1
Period
January 1-31, 2020 13,283 $ 44.42 13,283 $ 2,376
February 1-28, 2020 20,855 42.17 20,855 1,495
March 1-31, 2020 58,526 30.00 58,526 23,241
October 1-30, 2020 100 30.00 100 23,238
November 1-30, 2020 44,815 34.73 44,815 21,680
December 1-31, 2020 66,130 36.48 66,130 19,264
Total 203,709 $ 35.33 203,709
1 On February 28, 2020, the 2018 Share Repurchase Program expired with approximately $1.5 million remaining from the $25.0 million authorized for repurchases. The new $25.0 million Share Repurchase Program began March 1, 2020.
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ITEM 6 SELECTED FINANCIAL DATA
The following data has been derived from the audited consolidated financial statements of Bank of Marin Bancorp. For additional information, refer to ITEM 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, and ITEM 8, Financial Statements and Supplementary Data.
At or for the Years Ended December 31,
(dollars in thousands, except per share data) 2020 2019 2018 2017 2016
Selected financial condition data:
Total assets $ 2,911,926 $ 2,707,280 $ 2,520,892 $ 2,468,154 $ 2,023,493
Loans, net allowance for credit losses 1
2,065,682 1,826,609 1,748,043 1,663,246 1,471,174
Deposits 2,504,249 2,336,489 2,174,840 2,148,670 1,772,700
Borrowings and other obligations 2,835 2,920 9,640 5,739 5,586
Stockholders' equity 358,253 336,788 316,407 297,025 230,563
Selected operating data:
Net interest income $ 96,659 $ 95,680 $ 91,544 $ 74,852 $ 73,161
Provision for (reversal of) credit losses 4,594 900 — 500 (1,850)
Non-interest income 8,550 9,084 10,139 8,268 9,161
Non-interest expense 2
60,028 57,970 58,266 53,782 47,692
Net income 2
30,242 34,241 32,622 15,976 23,134
Net income per common share: 3
Basic $ 2.24 $ 2.51 $ 2.35 $ 1.29 $ 1.90
Diluted $ 2.22 $ 2.48 $ 2.33 $ 1.27 $ 1.89
Performance and other financial ratios:
Return on average assets 1.04 % 1.34 % 1.31 % 0.75 % 1.15 %
Return on average equity 8.60 % 10.49 % 10.73 % 6.49 % 10.23 %
Tax-equivalent net interest margin 4
3.55 % 3.98 % 3.90 % 3.80 % 3.91 %
Cost of deposits 0.11 % 0.20 % 0.10 % 0.07 % 0.08 %
Efficiency ratio 57.06 % 55.33 % 57.30 % 64.70 % 57.93 %
Loan-to-deposit ratio 83.40 % 78.89 % 81.10 % 78.14 % 83.86 %
Cash dividend payout ratio on common stock 5
41.07 % 31.87 % 27.23 % 43.41 % 26.84 %
Cash dividends per common share 3
$ 0.92 $ 0.80 $ 0.64 $ 0.56 $ 0.51
Asset quality ratios:
Allowance for credit losses to total loans 1.10 % 0.90 % 0.90 % 0.94 % 1.04 %
Allowance for credit losses to total loans, excluding acquired and SBA PPP loans 6
1.27 % 0.96 % 0.98 % 1.06 % 1.10 %
Allowance for credit losses to non-performing loans 7
2.48x 73.86x 22.71x 38.88x 106.50x
Non-performing loans to total loans 7
0.44 % 0.01 % 0.04 % 0.02 % 0.01 %
Capital ratios:
Equity to total assets ratio 12.30 % 12.44 % 12.55 % 12.03 % 11.39 %
Tangible common equity to tangible assets 8
11.27 % 11.30 % 11.29 % 10.71 % 11.00 %
Total capital (to risk-weighted assets) 16.03 % 15.07 % 14.93 % 14.91 % 14.32 %
Tier 1 capital (to risk-weighted assets) 14.82 % 14.24 % 14.10 % 14.04 % 13.37 %
Tier 1 capital (to average assets) 10.80 % 11.66 % 11.54 % 12.13 % 11.39 %
Common equity Tier 1 capital (to risk-weighted assets) 14.69 % 14.11 % 13.98 % 13.75 % 13.07 %
Other data:
Number of branches 22 22 23 23 20
Full time equivalent employees 289 290 290 291 262
1 Includes SBA PPP loans of $291.6 million at December 31, 2020. There were no SBA PPP loans prior to 2020.
2 2018 and 2017 included $962 thousand and $2.2 million, respectively, in merger-related expenses.
3 Share and per share data have been adjusted to reflect the two-for-one stock split effective November 27, 2018.
4 Tax-equivalent net interest margin is computed by dividing taxable equivalent net interest income, which is adjusted for taxable equivalent income on tax-exempt loans and securities based on federal statutory rate of 21% in 2020, 2019 and 2018 and 35% in years prior to 2018, by total average interest-earning assets.
5 Calculated as dividends on common shares divided by basic net income per common share.
6 The allowance for credit losses to total loans, excluding non-impaired acquired loans and guaranteed SBA PPP loans, is considered a meaningful non-GAAP financial measure, as it represents only those loans that were considered in the calculation of the allowance for credit losses. Due to the adoption of CECL on December 31, 2020, all loans previously considered "acquired" are now included in the calculation of the allowance for credit losses. Acquired loans that were not impaired totaled $108.8 million, $151.8 million, $196.5 million, and $86.4 million, at December 31, 2019, 2018, 2017, and 2016, respectively. Refer to footnote 1 above for SBA PPP loan totals.
7 Non-performing loans include loans on non-accrual status. There were no loans past due 90 days or more and still accruing interest as of the end of any of the years presented.
8 Tangible common equity to tangible assets is considered to be a meaningful non-GAAP financial measure of capital adequacy and is useful for investors to assess Bancorp's ability to absorb potential losses. Tangible common equity of $324 million, $302 million, $281 million, $260 million, and $222 million at December 31, 2020, 2019, 2018, 2017, and 2016, respectively, includes common stock, retained earnings and unrealized gains (losses) on available-for sale securities, net of tax, less goodwill and intangible assets of $34 million, $35 million, $36 million, $37 million, and $9 million at December 31, 2020, 2019, 2018, 2017, and 2016, respectively. Tangible assets excludes goodwill and core deposit intangible assets.
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