Bankwell Financial Group Reports Operating Results for the Third Quarter, Declares Fourth Quarter Dividend, and Announces Share Repurchase Plan

About this update from Bankwell Financial Group, Inc.

NEW CANAAN, Conn. --(BUSINESS WIRE)-- Bankwell Financial Group, Inc. (NASDAQ: BWFG), a leading commercial bank with a growing digital focus, reported GAAP net income of $1.9 million , or $0.24 per share for the third quarter of 2024, versus $1.1 million , or $0.14 per share, for the second quarter of 2024. The Company's Board of Directors declared a $0.20 per share cash dividend, payable November 22, 2024 to shareholders of record on November 11, 2024 . Third quarter of 2024 results include an $8.2 million previously disclosed charge-off taken against a $13.7 million office loan participation as a $0.79 drag to earnings per share. Pre-tax, pre-provision net revenue (PPNR) of $9.0 million , or $1.17 per share, fell 7% relative to the second quarter of 2024 at $9.7 million , or $1.25 per share. On October 28, 2024 , the Company announced that on October 23, 2024 , its Board of Directors authorized a new share repurchase plan. Under the terms of the share repurchase plan, the Company is authorized to buy back up to 250,000 shares of its outstanding common stock. In connection with the authorization of the new plan, the Company terminated its existing plan, originally approved in 2018 and amended in 2021, pursuant to which the Company has purchased 532,802 shares of its common stock. Discussion of Outlook; Bankwell Financial Group President and CEO, Christopher R. Gruseke : "Although we were disappointed with the elevated charge-off in the third quarter, the Company’s go-forward outlook remains favorable. Our liability sensitive balance sheet leaves us well positioned for accelerating margin expansion in the coming quarters, and we believe that strategic investments in our commercial lending platform will help us diversify our assets and improve our profitability." Key Points for Third Quarter and Bankwell’s Outlook Brokered Deposits Decrease, Liability Sensitive Balance Sheet. Brokered deposits declined $24.2 million in the third quarter of 2024 and are down $168.5 million since December 31, 2023 . Reported net interest margin was 2.72%, which included a -6 basis point impact as a result of charges associated with a single non-performing loan and fees associated with called brokered CDs. With $1.3 billion of time deposits maturing in the next 12 months at a weighted average rate of 4.89%, the Company anticipates an annualized reduction in funding costs by $3.35 million , given current pricing. This translates into approximately $0.33 incremental EPS, or approximately 11 basis points on net interest margin, given no further changes to Fed Funds and stable asset yields. Further, the Company anticipates $0.5 billion of loans to reprice or mature over the same period, which could further benefit net interest margin by an additional 15 to 20 basis points on an annualized basis. NPL to be Sold, Residential Care Upgrades a Positive Sign. A $27.1 million multifamily commercial real estate loan was placed on nonperforming status as of September 30, 2024 . As of October 28, 2024 , the Company has a signed agreement for the sale of this loan at par value. As of September 30, 2024 , this loan comprises 103 basis points of the 2.50% nonperforming loans as a percentage of total loans. Elsewhere, favorable macroeconomic trends were reflected in improved operating results among the Company's residential care borrowers. Specifically, during the quarter four relationships totaling $42 million were upgraded. The Company anticipates the positive trend to continue as both Medicaid reimbursement rates and operational costs normalize. Ongoing Investments with Continued Focus on Efficiency . The Company continues to invest for future growth, with notable recent developments including a lending partnership with Lendio , the launch of Bankwell Direct, the launch of a new Small Business Administration (SBA) division, and hiring key leadership personnel. The Company continues to operate efficiently with a non-interest expense to average asset ratio of 1.62% for the quarter ended September 30, 2024 . Third Quarter 2024 Financial Highlights and Key Performance Indicators (KPIs): September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 Return on average assets(1) 0.24 % 0.14 % 0.47 % 1.03 % 1.19 % Pre-tax, pre-provision net revenue return on average assets(1) 1.13 % 1.22 % 1.10 % 1.27 % 1.37 % Return on average shareholders' equity(1) 2.83 % 1.65 % 5.59 % 12.82 % 15.19 % Net interest margin(1) 2.72 % 2.75 % 2.71 % 2.81 % 2.85 % Efficiency Ratio(1)(2) 58.8 % 55.9 % 60.3 % 55.0 % 52.0 % Noninterest expense to average assets(1) 1.62 % 1.55 % 1.66 % 1.56 % 1.48 % Net loan charge-offs as % of average loans(1) 0.56 % 0.01 % 0.11 % 0.01 % — % Dividend payout(1)(3) 82.30 % 142.86 % 41.67 % 18.35 % 16.00 % Fully diluted tangible book value per common share(1) $ 33.76 $ 33.61 $ 33.57 $ 33.39 $ 32.55 Total capital to risk-weighted assets(1)(4) 12.83 % 12.98 % 12.63 % 12.32 % 11.86 % Total common equity tier 1 capital to risk-weighted assets(1)(4) 11.80 % 11.73 % 11.60 % 11.30 % 10.82 % Tier I Capital to Average Assets(1)(4) 10.24 % 10.17 % 10.09 % 9.81 % 9.60 % Tangible common equity to tangible assets(1) 8.40 % 8.42 % 8.42 % 8.19 % 7.86 % Earnings per common share - diluted $ 0.24 $ 0.14 $ 0.48 $ 1.09 $ 1.25 Common shares issued and outstanding 7,858,573 7,866,499 7,908,180 7,882,616 7,841,616 (1) Non-GAAP Financial Measure, refer to the "Non-GAAP Financial Measures" and the "Reconciliation of GAAP to Non-GAAP Measures" sections of this document for additional detail. (2) Efficiency ratio is defined as noninterest expense, less other real estate owned expenses and amortization of intangible assets, divided by our operating revenue, which is equal to net interest income plus noninterest income excluding gains and losses on sales of securities and gains and losses on other real estate owned. In our judgment, the adjustments made to operating revenue allow investors and analysts to better assess our operating expenses in relation to our core operating revenue by removing the volatility that is associated with certain one-time items and other discrete items that are unrelated to our core business. (3) The dividend payout ratio is calculated by dividing dividends per share by earnings per share. (4) Represents Bank ratios. Current period capital ratios are preliminary subject to finalization of the FDIC Call Report. Pre-Tax, Pre-Provision Net Revenue(1) ("PPNR") PPNR for the three and nine months ended September 30, 2024 , were $9.0 million and $27.4 million , respectively, a decrease of 20.1% and 28.6%, respectively, from the $11.3 million and $38.4 million recognized in the three and nine months ended September 30, 2023 , respectively. For the Quarter Ended For the Nine Months Ended (Dollars in thousands) September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 September 30 , 2024 September 30 , 2023 Net interest income $ 20,717 $ 21,219 $ 21,147 $ 22,245 $ 22,691 $ 63,083 $ 72,223 Total noninterest income 1,156 683 915 1,129 786 2,754 3,713 Total revenues 21,873 21,902 22,062 23,374 23,477 65,837 75,936 Total noninterest expense 12,865 12,245 13,297 12,864 12,205 38,407 37,537 PPNR $ 9,008 $ 9,657 $ 8,765 $ 10,510 $ 11,272 $ 27,430 $ 38,399 (1) Non-GAAP Financial Measure, refer to the "Non-GAAP Financial Measures" section of this document for additional detail. Revenues (net interest income plus noninterest income) for the quarter ended September 30, 2024 were $21.9 million , versus $23.5 million for the quarter ended September 30, 2023 . The decrease in revenues for the quarter ended September 30, 2024 was attributable to an increase in interest expense on deposits. Revenues for the nine months ended September 30, 2024 were $65.8 million , versus $75.9 million for the nine months ended September 30, 2023 . The decrease in revenues for the quarter ended September 30, 2024 was attributable to an increase in interest expense on deposits and lower gains from loan sales, partially offset by an increase in interest and fees on loans due to higher loan yields and prepayment fees. The net interest margin (fully taxable equivalent basis) for the quarters ended September 30, 2024 and September 30, 2023 was 2.72% and 2.85%, respectively. The decrease in the net interest margin was due to an increase in funding costs, partially offset by an increase in interest income on earning assets. For the quarter ended September 30, 2024 , the net interest margin includes a -5 basis point unfavorable impact as a result of the $27.1 million commercial real estate loan being placed on non-performing status plus a -1 basis point unfavorable impact from one-time costs associated with Brokered CDs called during the quarter. Overall non-interest income of $1.2 million increased 69.3% when compared to the second quarter, primarily due to higher gains as a result of more SBA loan sales. Service charges increased when compared to the second quarter and continues to grow on a positive trend line. Total non-interest expense of $12.9 million increased 5% compared to the second quarter as the Company continues to invest in strategic initiatives. Allowance for Credit Losses - Loans ("ACL-Loans") The ACL-Loans was $27.8 million as of September 30, 2024 compared to $27.9 million as of December 31, 2023 . The ACL-Loans as a percentage of total loans was 1.06% as of September 30, 2024 compared to 1.03% as of December 31, 2023 . Provision for credit losses was $6.3 million for the quarter ended September 30, 2024 . The increase in the provision for credit losses for the quarter was primarily due to a charge-off of $8.2 million which previously did not have an associated specific reserve. The increase was partially offset by a $1.0 million recovery on a previously charged-off loan. Total nonaccrual loans increased $9.3 million to $65.5 million as of September 30, 2024 when compared to the previous quarter. The increase was primarily due to a $27.1 million commercial real estate multifamily loan1. The increase was partially offset by two loans that were partially charged-off for a total of $15.4 million and two loans that were paid off totaling $4.7 million in the third quarter of 2024. Nonperforming assets as a percentage of total assets increased to 2.07% at September 30, 2024 from 1.53% at December 31, 2023 . As of October 28, 2024 , the Company has a signed agreement for the sale of this loan at par value. BANKWELL FINANCIAL GROUP, INC. ASSET QUALITY (unaudited) (Dollars in thousands) For the Quarter Ended September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 ACL-Loans: Balance at beginning of period $ 36,083 $ 27,991 $ 27,946 $ 29,284 $ 30,694 Charge-offs: Residential real estate — (9 ) (132 ) — — Commercial real estate (8,184 ) (522 ) (3,306 ) (824 ) — Commercial business (7,010 ) — (197 ) — — Consumer (17 ) (12 ) (49 ) (15 ) (31 ) Construction (616 ) — — — — Total charge-offs (15,827 ) (543 ) (3,684 ) (839 ) (31 ) Recoveries: Residential real estate — 141 — — — Commercial real estate 1,013 113 — — — Commercial business (34 ) — 27 464 35 Consumer 1 13 4 3 19 Construction — — — — — Total recoveries 980 267 31 467 54 Net loan (charge-offs) recoveries (14,847 ) (276 ) (3,653 ) (372 ) 23 Provision (credit) for credit losses - loans 6,516 8,368 3,698 (966 ) (1,433 ) Balance at end of period $ 27,752 $ 36,083 $ 27,991 $ 27,946 $ 29,284 As of September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 Asset quality: Nonaccrual loans Residential real estate $ 1,316 $ 1,339 $ 1,237 $ 1,386 $ 1,408 Commercial real estate 46,360 28,088 19,083 23,009 1,898 Commercial business 9,101 17,396 16,841 15,430 7,352 Construction 8,766 9,382 9,382 9,382 9,382 Consumer — — — — 7,917 Total nonaccrual loans 65,543 56,205 46,543 49,207 27,957 Other real estate owned — — — — — Total nonperforming assets $ 65,543 $ 56,205 $ 46,543 $ 49,207 $ 27,957 Nonperforming loans as a % of total loans 2.50 % 2.12 % 1.74 % 1.81 % 1.01 % Nonperforming assets as a % of total assets 2.07 % 1.79 % 1.48 % 1.53 % 0.86 % ACL-loans as a % of total loans 1.06 % 1.36 % 1.04 % 1.03 % 1.06 % ACL-loans as a % of nonperforming loans 42.34 % 64.20 % 60.14 % 56.79 % 104.75 % Total past due loans to total loans 2.48 % 0.84 % 1.44 % 0.78 % 1.44 % Financial Condition & Capital Assets totaled $3.2 billion at September 30, 2024 , a decrease of $54.4 million , or 1.7% compared to December 31, 2023 . Gross loans totaled $2.6 billion at September 30, 2024 , a decrease of $95.4 million , or 3.5% compared to December 31, 2023 . Deposits totaled $2.7 billion at September 30, 2024 , a decrease of $48.6 million , or 1.8% compared to December 31, 2023 . Brokered deposits have decreased $168.5 million or 17.7%, when compared to December 31, 2023 Period End Loan Composition September 30 , 2024 June 30 , 2024 December 31 , 2023 Current QTD % Change YTD % Change Residential Real Estate $ 45,553 $ 47,875 $ 50,931 (4.9 )% (10.6 )% Commercial Real Estate (1) 1,887,942 1,912,701 1,947,648 (1.3 ) (3.1 ) Construction 160,292 150,259 183,414 6.7 (12.6 ) Total Real Estate Loans 2,093,787 2,110,835 2,181,993 (0.8 ) (4.0 ) Commercial Business 490,292 503,444 500,569 (2.6 ) (2.1 ) Consumer 39,126 42,906 36,045 (8.8 ) 8.5 Total Loans $ 2,623,205 $ 2,657,185 $ 2,718,607 (1.3 )% (3.5 )% (1) Includes owner occupied commercial real estate of $0.7 billion at September 30, 2024 , June 30, 2024 , and December 31, 2023 , respectively. Period End Deposit Composition September 30 , 2024 June 30 , 2024 December 31 , 2023 Current QTD % Change YTD % Change Noninterest bearing demand $ 295,552 $ 328,475 $ 346,172 (10.0 )% (14.6 )% NOW 76,413 122,112 90,829 (37.4 ) (15.9 ) Money Market 840,234 825,599 887,352 1.8 (5.3 ) Savings 87,212 91,870 97,331 (5.1 ) (10.4 ) Time 1,388,760 1,294,319 1,315,073 7.3 5.6 Total Deposits $ 2,688,171 $ 2,662,375 $ 2,736,757 1.0 % (1.8 )% Shareholders’ equity totaled $267.9 million as of September 30, 2024 , an increase of $2.2 million compared to December 31, 2023 , primarily a result of net income of $6.8 million for the nine months ended September 30, 2024 . The increase was partially offset by dividends paid of $4.7 million . The Company's capital position was generally stable during the third quarter, with total risk-based capital, common-equity tier 1 capital and leverage ratios at 12.83%, 11.80%, and 10.24%, respectively, at September 30, 2024 . The Company repurchased 9,670 shares and 85,990 shares at weighted average prices of $23.86 and $24.82 per share for the quarter and nine months ended September 30, 2024 . We recommend reading this earnings release in conjunction with the Third Quarter 2024 Investor Presentation, located at http://investor.mybankwell.com/Presentations and included as an exhibit to our October 28, 2024 Current Report on Form 8-K. Conference Call Bankwell will host a conference call to discuss the Company’s financial results and business outlook on October 29, 2024 , at 10:00 a.m. E.T. The call will be accessible by telephone and webcast using https://investor.mybankwell.com/news-market-data/event-calendar/default.aspx . A supplementary slide presentation will be posted to the website prior to the event, and a replay will be available for 12 months following the event. About Bankwell Financial Group Bankwell Financial Group, Inc. is the holding company for Bankwell Bank (“Bankwell”). Bankwell is a full-service Commercial Bank , established in 2013. Headquartered in New Canaan, CT , Bankwell serves customers nationwide, delivering unmatched accessibility, expertise, and responsiveness. Bankwell offers an array of commercial financing products, including Working Capital lines of credit, SBA loans, Acquisition loans, and Commercial mortgages, in addition to digital and physical treasury management and deposit services. For more information about this press release, interested parties may contact Christopher R. Gruseke , President and Chief Executive Officer or Courtney E. Sacchetti , Executive Vice President and Chief Financial Officer of Bankwell Financial Group at (203) 652-0166 or at [email protected] . For more information, visit www.mybankwell.com . This press release may contain certain forward-looking statements about the Company. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include increased competitive pressures, changes in the interest rate environment, general economic conditions or conditions within the banking industry or securities markets, and legislative and regulatory changes that could adversely affect the business in which the Company and its subsidiaries are engaged. Non-GAAP Financial Measures In addition to evaluating the Company's financial performance in accordance with U.S. generally accepted accounting principles ("GAAP"), management may evaluate certain non-GAAP financial measures, such as the efficiency ratio. A computation and reconciliation of certain non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of GAAP to Non-GAAP Measures tables. We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. For example, the Company believes that the efficiency ratio is useful in the assessment of financial performance, including noninterest expense control. The Company believes that tangible common equity, tangible assets, tangible common equity to tangible assets, tangible common shareholders' equity, fully diluted tangible book value per common share, adjusted noninterest expense, operating revenue, efficiency ratio, average tangible common equity, annualized return on average tangible common equity, return on average assets, return on average shareholders' equity, pre-tax, pre-provision net revenue, net interest margin, net loan charge-offs as a percentage of average loans, pre-tax, pre-provision net revenue on average assets, and the dividend payout ratio are useful to evaluate the relative strength of the Company's performance and capital position. We utilize these measures for internal planning and forecasting purposes. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. BANKWELL FINANCIAL GROUP, INC. CONSOLIDATED BALANCE SHEETS (unaudited) (Dollars in thousands) September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 ASSETS Cash and due from banks $ 275,829 $ 234,277 $ 245,043 $ 267,521 $ 256,973 Federal funds sold 15,508 17,103 2,584 1,636 1,122 Cash and cash equivalents 291,337 251,380 247,627 269,157 258,095 Investment securities Marketable equity securities, at fair value 2,148 2,079 2,069 2,070 1,975 Available for sale investment securities, at fair value 108,866 107,635 108,417 109,736 97,907 Held to maturity investment securities, at amortized cost 34,886 28,286 15,739 15,817 15,885 Total investment securities 145,900 138,000 126,225 127,623 115,767 Loans receivable (net of ACL-Loans of $27,752 , $36,083 , $27,991 , $27,946 , and $29,284 at September 30, 2024 , June 30, 2024 , March 31, 2024 , December 31, 2023 , and September 30, 2023 , respectively) 2,591,551 2,616,691 2,646,686 2,685,301 2,735,242 Accrued interest receivable 14,714 14,675 15,104 14,863 15,648 Federal Home Loan Bank stock, at cost 5,655 5,655 5,655 5,696 5,696 Premises and equipment, net 24,780 25,599 26,161 27,018 26,899 Bank-owned life insurance 52,443 52,097 51,764 51,435 51,119 Goodwill 2,589 2,589 2,589 2,589 2,589 Deferred income taxes, net 9,300 11,345 9,137 9,383 9,395 Other assets 22,811 23,623 24,326 22,417 29,326 Total assets $ 3,161,080 $ 3,141,654 $ 3,155,274 $ 3,215,482 $ 3,249,776 LIABILITIES AND SHAREHOLDERS’ EQUITY Liabilities Deposits Noninterest bearing deposits $ 293,195 $ 328,475 $ 376,248 $ 346,172 $ 345,433 Interest bearing deposits 2,394,976 2,333,900 2,297,274 2,390,585 2,423,193 Total deposits 2,688,171 2,662,375 2,673,522 2,736,757 2,768,626 Advances from the Federal Home Loan Bank 90,000 90,000 90,000 90,000 90,000 Subordinated debentures 69,389 69,328 69,266 69,205 69,143 Accrued expenses and other liabilities 45,594 52,975 54,454 53,768 64,145 Total liabilities 2,893,154 2,874,678 2,887,242 2,949,730 2,991,914 Shareholders’ equity Common stock, no par value 118,429 118,037 118,401 118,247 117,181 Retained earnings 151,257 150,895 151,350 149,169 142,205 Accumulated other comprehensive (loss) (1,760 ) (1,956 ) (1,719 ) (1,664 ) (1,524 ) Total shareholders’ equity 267,926 266,976 268,032 265,752 257,862 Total liabilities and shareholders’ equity $ 3,161,080 $ 3,141,654 $ 3,155,274 $ 3,215,482 $ 3,249,776 BANKWELL FINANCIAL GROUP, INC. CONSOLIDATED STATEMENTS OF INCOME (unaudited) (Dollars in thousands, except share data) For the Quarter Ended For the Nine Months Ended September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 September 30 , 2024 September 30 , 2023 Interest and dividend income Interest and fees on loans $ 43,596 $ 43,060 $ 43,325 $ 44,122 $ 43,854 $ 129,981 $ 126,059 Interest and dividends on securities 1,390 1,190 1,130 1,108 1,016 3,710 3,018 Interest on cash and cash equivalents 3,205 3,429 3,826 4,164 3,393 10,460 9,983 Total interest and dividend income 48,191 47,679 48,281 49,394 48,263 144,151 139,060 Interest expense Interest expense on deposits 25,579 24,677 25,362 25,307 23,789 75,618 61,599 Interest expense on borrowings 1,895 1,783 1,772 1,842 1,783 5,450 5,238 Total interest expense 27,474 26,460 27,134 27,149 25,572 81,068 66,837 Net interest income 20,717 21,219 21,147 22,245 22,691 63,083 72,223 Provision (credit) for credit losses 6,296 8,183 3,683 (960 ) (1,579 ) 18,162 1,826 Net interest income after provision (credit) for credit losses 14,421 13,036 17,464 23,205 24,270 44,921 70,397 Noninterest income Bank owned life insurance 346 333 329 316 303 1,008 876 Service charges and fees 575 495 304 688 294 1,374 941 Gains and fees from sales of loans 133 45 321 79 237 499 1,893 Other 102 (190 ) (39 ) 46 (48 ) (127 ) 3 Total noninterest income 1,156 683 915 1,129 786 2,754 3,713 Noninterest expense Salaries and employee benefits 6,223 6,176 6,291 6,088 6,036 18,690 18,507 Occupancy and equipment 2,334 2,238 2,322 2,231 2,146 6,894 6,434 Professional services 1,142 989 1,065 1,033 491 3,196 2,505 Data processing 851 755 740 747 741 2,346 2,141 Director fees 292 306 900 605 362 1,498 1,207 FDIC insurance 853 705 930 1,026 1,026 2,488 3,138 Marketing 73 90 114 139 184 277 512 Other 1,097 986 935 995 1,219 3,018 3,093 Total noninterest expense 12,865 12,245 13,297 12,864 12,205 38,407 37,537 Income before income tax expense 2,712 1,474 5,082 11,470 12,851 9,268 36,573 Income tax expense 786 356 1,319 2,946 3,074 2,461 8,434 Net income $ 1,926 $ 1,118 $ 3,763 $ 8,524 $ 9,777 $ 6,807 $ 28,139 Earnings Per Common Share: Basic $ 0.24 $ 0.14 $ 0.48 $ 1.09 $ 1.25 $ 0.86 $ 3.61 Diluted $ 0.24 $ 0.14 $ 0.48 $ 1.09 $ 1.25 $ 0.86 $ 3.58 Weighted Average Common Shares Outstanding: Basic 7,715,040 7,747,675 7,663,521 7,603,938 7,598,230 7,708,768 7,582,272 Diluted 7,720,895 7,723,888 7,687,679 7,650,451 7,633,934 7,731,454 7,646,837 Dividends per common share $ 0.20 $ 0.20 $ 0.20 $ 0.20 $ 0.20 $ 0.60 $ 0.60 BANKWELL FINANCIAL GROUP, INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURES (unaudited) (Dollars in thousands, except share data) As of Computation of Tangible Common Equity to Tangible Assets September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 Total Equity $ 267,926 $ 266,976 $ 268,032 $ 265,752 $ 257,862 Less: Goodwill 2,589 2,589 2,589 2,589 2,589 Other intangibles — — — — — Tangible Common Equity $ 265,337 $ 264,387 $ 265,443 $ 263,163 $ 255,273 Total Assets $ 3,161,080 $ 3,141,654 $ 3,155,274 $ 3,215,482 $ 3,249,776 Less: Goodwill 2,589 2,589 2,589 2,589 2,589 Other intangibles — — — — — Tangible Assets $ 3,158,491 $ 3,139,065 $ 3,152,685 $ 3,212,893 $ 3,247,187 Tangible Common Equity to Tangible Assets 8.40 % 8.42 % 8.42 % 8.19 % 7.86 % As of Computation of Fully Diluted Tangible Book Value per Common Share September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 Total shareholders' equity $ 267,926 $ 266,976 $ 268,032 $ 265,752 $ 257,862 Less: Preferred stock — — — — — Common shareholders' equity $ 267,926 $ 266,976 $ 268,032 $ 265,752 $ 257,862 Less: Goodwill 2,589 2,589 2,589 2,589 2,589 Other intangibles — — — — — Tangible common shareholders' equity $ 265,337 $ 264,387 $ 265,443 $ 263,163 $ 255,273 Common shares issued and outstanding 7,858,573 7,866,499 7,908,180 7,882,616 7,841,616 Fully Diluted Tangible Book Value per Common Share $ 33.76 $ 33.61 $ 33.57 $ 33.39 $ 32.55 BANKWELL FINANCIAL GROUP, INC. NET INTEREST MARGIN ANALYSIS ON A FULLY TAX EQUIVALENT BASIS - QTD (unaudited) ( Dollars in thousands) For the Quarter Ended September 30, 2024 September 30, 2023 Average Balance Interest Yield/ Rate (4) Average Balance Interest Yield/ Rate (4) Assets: Cash and Fed funds sold $ 253,664 $ 3,205 5.03 % $ 265,115 $ 3,393 5.08 % Securities(1) 147,431 1,390 3.78 127,229 953 3.00 Loans: Commercial real estate 1,905,506 28,288 5.81 1,943,725 28,140 5.67 Residential real estate 47,481 736 6.20 53,966 671 4.97 Construction 156,273 3,070 7.69 209,154 3,908 7.31 Commercial business 512,507 10,783 8.23 539,185 10,394 7.54 Consumer 41,845 719 6.84 44,020 741 6.66 Total loans 2,663,612 43,596 6.40 2,790,050 43,854 6.15 Federal Home Loan Bank stock 5,655 122 8.32 5,696 115 8.13 Total earning assets 3,070,362 $ 48,313 6.16 % 3,188,090 $ 48,315 5.93 % Other assets 90,410 78,089 Total assets $ 3,160,772 $ 3,266,179 Liabilities and shareholders' equity: Interest bearing liabilities: NOW $ 94,958 $ 45 0.18 % $ 102,149 $ 47 0.18 % Money market 832,430 8,597 4.11 922,036 9,064 3.90 Savings 89,463 691 3.07 105,366 817 3.08 Time 1,347,857 16,246 4.79 1,322,074 13,861 4.16 Total interest bearing deposits 2,364,708 25,579 4.30 2,451,625 23,789 3.85 Borrowed Money 159,349 1,895 4.73 159,103 1,783 4.39 Total interest bearing liabilities 2,524,057 $ 27,474 4.33 % 2,610,728 $ 25,572 3.89 % Noninterest bearing deposits 303,213 345,988 Other liabilities 62,602 54,136 Total liabilities 2,889,872 3,010,852 Shareholders' equity 270,900 255,327 Total liabilities and shareholders' equity $ 3,160,772 $ 3,266,179 Net interest income(2) $ 20,839 $ 22,743 Interest rate spread 1.83 % 2.04 % Net interest margin(3) 2.72 % 2.85 % (1) Average balances and yields for securities are based on amortized cost. (2) The adjustment for securities and loans taxable equivalency amounted to $122 thousand and $52 thousand for the quarters ended September 30, 2024 and 2023, respectively. (3) Annualized net interest income as a percentage of earning assets. (4) Yields are calculated using the contractual day count convention for each respective product type. BANKWELL FINANCIAL GROUP, INC. NET INTEREST MARGIN ANALYSIS ON A FULLY TAX EQUIVALENT BASIS - YTD (unaudited) (Dollars in thousands) For the Nine Months Ended September 30, 2024 September 30, 2023 Average Balance Interest Yield/ Rate (4) Average Balance Interest Yield/ Rate (4) Assets: Cash and Fed funds sold $ 273,138 $ 10,460 5.12 % $ 281,033 $ 9,983 4.75 % Securities(1) 139,871 3,592 3.42 128,554 2,864 2.97 Loans: Commercial real estate 1,909,390 84,582 5.82 1,932,549 79,958 5.46 Residential real estate 48,912 2,226 6.07 56,798 1,957 4.59 Construction 158,884 8,913 7.37 194,396 10,582 7.18 Commercial business 517,880 32,097 8.14 546,329 32,073 7.74 Consumer 41,383 2,162 6.98 30,571 1,489 6.51 Total loans 2,676,449 129,980 6.38 2,760,643 126,059 6.02 Federal Home Loan Bank stock 5,670 358 8.43 5,527 308 7.46 Total earning assets 3,095,128 $ 144,390 6.13 % 3,175,757 $ 139,214 5.78 % Other assets 92,249 66,342 Total assets $ 3,187,377 $ 3,242,099 Liabilities and shareholders' equity: Interest bearing liabilities: NOW $ 97,970 $ 133 0.18 % $ 97,741 $ 127 0.17 % Money market 849,860 26,294 4.13 910,840 23,532 3.45 Savings 91,135 2,093 3.07 117,984 2,404 2.72 Time 1,319,031 47,097 4.77 1,291,124 35,536 3.68 Total interest bearing deposits 2,357,996 75,617 4.28 2,417,689 61,599 3.41 Borrowed Money 159,288 5,450 4.57 161,166 5,238 4.29 Total interest bearing liabilities 2,517,284 $ 81,067 4.30 % 2,578,855 $ 66,837 3.47 % Noninterest bearing deposits 336,129 374,943 Other liabilities 62,631 40,192 Total liabilities 2,916,044 2,993,990 Shareholders' equity 271,333 248,109 Total liabilities and shareholders' equity $ 3,187,377 $ 3,242,099 Net interest income(2) $ 63,323 $ 72,377 Interest rate spread 1.83 % 2.31 % Net interest margin(3) 2.73 % 3.04 % (1) Average balances and yields for securities are based on amortized cost. (2) The adjustment for securities and loans taxable equivalency amounted to $240 thousand and $154 thousand for the nine months ended September 30, 2024 and 2023, respectively. (3) Annualized net interest income as a percentage of earning assets. (4) Yields are calculated using the contractual day count convention for each respective product type. View source version on businesswire.com : https://www.businesswire.com/news/home/20241028117073/en/ Christopher R. Gruseke , President and Chief Executive Officer or Courtney E. Sacchetti , Executive Vice President and Chief Financial Officer Bankwell Financial Group (203) 652-0166 [email protected] Source: Bankwell Financial Group, Inc

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