<body.content> <block> <p>HAMILTON, Bermuda, Oct. 20 /PRNewswire-FirstCall/ — Bank of Bermuda today announced third quarter diluted earnings per share* of $0.75. This compares with$0.71 in the previous quarter and $0.46 in the third quarter of 2002.</p> <p>Edward H. Gomez, Chief Financial Officer, commented: “The quarter’s results reflect excellent performance byour fee based business lines. Our largest business, Global Fund Services, led the way with a 16% growth in fee revenues, which drove our overall non-interest income to a record $76.6 million for thequarter. The effects of our continuing new business growth are being realised and the value of existing client assets are starting to recover from their recent depressed levels. Foreign exchangeearnings also had another strong quarter as client trading volumes remain robust during more volatile market conditions. Our net interest earnings should be considered together with associated hedgecosts, included in investment losses. Together, these lines are slightly higher than a year ago, reflecting improved performance by our outsourced trading portfolio, offset partly by the effects ofcontinued margin pressure.</p> <p>Mr. Gomez continued: “Operating costs have increased to support business growth while we remain focused on discretionary cost controls and improvingoperating efficiency. Third quarter expenses also include some one-time charges as we continue to streamline our support structure and focus headcount on areas of business growth.”</p> <pstyle=”pre” id=”pre1″> * Bank of Bermuda’s results are stated in U.S. Dollars and in accordance
with U.S. Generally Accepted Accounting Principles.
</p> <p>Chief Executive Officer, Henry B. Smith, added: “These results demonstrate our success at growing our business in carefully selected niche markets where our relationship-driven approach gives us a strategic advantage. We have continued to expand our global presence in the current quarter through our recently announced South Africa and Tokyo offices. Another key focus is developing innovative technology tailored to the needs of our client base, and we have recently achieved the launch of new products for our GFS client base that we anticipate will improve both service and revenues. We believe that such investments, combined with strengthened client-focused teams, provide a solid base for continued success as markets recover. We are also maintaining our focus on operating efficiency. Our dedicated staff and strict discipline have produced robust earnings in what can still be described as a very challenging economic environment.”</p> <p style=”pre” id=”pre2″> Quarter Ended 30 September 2003 compared with Quarter Ended 30 September
2002 </p> <p>Total revenue in the quarter rose from $100.2 million in 2002 to $117 million in 2003, equivalent to a 17% increase. Non-interest income, which accounts for 65% of total revenue, increased by 15% to $76.6 million. Net interest income, before provision for loan losses, decreased by $3.7 million while investment losses on the outsourced trading portfolio, which represents the change in value of the net hedged portfolio, were $8.6 million lower than the prior year quarter.</p> <p>Fees from our global fund services (GFS) products, the largest portion of non-interest income, increased $5.2 million to $37.4 million. This 16% increase resulted from increases in the values of our hedge fund and fund-of-funds client base in North America and Europe, as well as hedge fund and pension fund assets in the Far East. All of GFS’s key locations demonstrated growth as fees in Hong Kong were up $2 million reflecting growth of pension assets, while fees in New York and Dublin were each up $1.2 million.</p> <p>Private trust fees increased $700,000 to $8.2 million in the current quarter, as improved client asset values generated higher ad valorum fees. Investment services fees of $10.5 million were 6.5% higher than the same quarter last year, reflecting increased discretionary management and brokerage fees. Assets in Bank of Bermuda proprietary mutual funds totalled $6.8 billion, compared with $6.5 billion at September 30, 2002.</p> <p>Foreign exchange earnings were $13.6 million, up 24% from the year-ago quarter. Continued currency market volatility and uncertainty increased client trading volumes, which as a whole were up 16%. Banking services fees were $7 million in the quarter, up 15% from a year ago.</p> <p>Net interest income before loan losses decreased $3.7 million to $41.5 million, with the impact of a $365 million increase in average interest earning assets more than offset by the reduction in net interest margin from 1.85% to 1.63%. This margin decline reflects the decision in late 2002 to reduce the size of the outsourced portfolio in order to reduce earnings volatility. Net interest margin was also impacted by the two Federal Reserve rate cuts during the past year as more zero rate floors became effective on interest bearing demand and fixed term deposits. Growth of $272 million in our loan book somewhat mitigated the combined effect of the reduced portfolio and the rate cuts.</p> <p>Net provisions for loan losses were $0.5 million, compared with a net release of $1.4 million in the year-ago quarter that reflected recoveries of loans previously charged off. Impaired loans were $2 million lower than a year ago at $22.4 million. The coverage ratio was 121%, up from 117% in the linked quarter.</p> <p>Investment losses on the trading portfolio decreased from $12.4 million to $3.8 million. These losses were more than offset by interest earnings so that on a net basis the outsourced portfolio contributed $0.4 million to net income in the 2003 third quarter on an average portfolio balance of $503 million. A year earlier, when the average portfolio size was $1.3 billion, it contributed $0.2 million to net income on the same basis. The third quarter performance on the portfolio was 1.14% below its target return; in the same period last year it was 2.13% below target. Despite the below target performance in the quarter the absolute return from this portfolio continues to exceed the yield from our internally managed asset base on a long-term basis.</p> <p>Investment and other income was $3.5 million in the quarter. This reflects gains on the sale of available for sale securities and other investment income.</p> <p>Operating expenses increased by $8.9 million year-over-year to $92.9 million. Salary costs were $5.3 million higher, and included redundancy actions taken in the quarter to achieve further operating efficiencies. Pension and staff benefits declined $0.5 million as adverse currency movements were more than offset by lower recruitment and training expenditure. General corporate expenses increased by $3.9 million primarily reflecting higher insurance costs from the year-ago quarter.</p> <p>Income tax expense was $1.8 million, down from $2.1 million in the prior year as a result of lower taxable income in Guernsey and Luxembourg.</p> <p>Forward Looking Statements</p> <p>Certain of the statements contained in this media release that are not historical facts are statements of future expectations and other forward looking statements that are based on management’s current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Some of these forward looking statements can be identified by the use of forward looking words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “strives,” “approximately,” “intends,” “plans,” “estimates” or “anticipates” or the negative of those words or other comparable terminology. Forward looking statements involve inherent risks and uncertainties and are not guarantees of future performance or results. A number of important factors could cause actual results to differ materially from those in the forward looking statements, including, without limitation, changes in securities market valuations; changes in foreign exchange rates; fluctuations in interest rates; inflation; volatility and volume of securities transactions in emerging markets; volatility of currency markets; changes in savings rates or investment behaviour; changing pension requirements in target markets; government regulations, including banking regulations; local economic conditions; and competition in the geographic and business areas in which we conduct our operations. Additional factors that could cause our actual results to differ materially from those in the forward looking statements can be found in our 2002 Annual Report in the section entitled “Forward Looking Statements”.</p> <p>Notes to Editors</p> <p>The Bank’s results are stated in accordance with generally accepted accounting principles in the United States.</p> <p>Bank of Bermuda</p> <p>Bank of Bermuda is an international financial institution that provides banking, trust, asset management, fund administration and global custody services to its corporate, private and retail clients. Founded in 1889, its global headquarters are in Bermuda, and it has offices or subsidiaries in the Cayman Islands, Cook Islands, Dublin, Guernsey, Hong Kong, Isle of Man, Jersey, London, Luxembourg, New York, New Zealand, Singapore, South Africa, Tokyo, Bahrain and Switzerland.</p> <p>The Bank is a publicly-traded corporation, listed on the Bermuda Stock Exchange (BOB) and NASDAQ (BBDA).</p> <p>Further information on Bank of Bermuda is located on the Internet at <a>http://www.bankofbermuda.com/</a>.</p> <p>Pre-recorded Message</p> <p>Pre-recorded comments from Henry B. Smith, Chief Executive Officer and William H. Scott, Head of Corporate Planning will be available via telephone (800) 432-7890 (toll-free inside the US) and (973) 317-1168 (for access outside the US) and the internet <a>http://www.bankofbermuda.com/investorrelations/webcast.htm</a> beginning at approximately 9:00 a.m. (ET) on Tuesday, October 21, 2003.</p> <p style=”pre” id=”pre3″> BANK OF BERMUDA
FINANCIAL SUMMARY
(Unaudited, in U.S. dollars in millions, except per share amounts)
For the Quarter
2002 2003
3rd 4th 1st 2nd 3rd
U.S. GAAP Earnings
Net income 14.1 16.6 21.6 20.6 22.3
Earnings per share
-Basic (a) 0.48 0.57 0.75 0.72 0.78
-Diluted (a) 0.46 0.56 0.73 0.71 0.75
U.S. GAAP Operating Results(b)
Non-interest income 66.6 67.1 66.7 71.9 76.6
Net interest income after loan losses 46.7 43.6 39.4 39.5 41.0
Investment income (loss) (13.1) (1.5) 1.0 1.5 (0.6)
Total revenues 100.2 109.2 107.1 112.9 117.0
Operating expenses 84.0 92.5 84.0 90.7 92.9
Income taxes 2.1 0.1 1.5 1.6 1.8
Net Income 14.1 16.6 21.6 20.6 22.3
Return on Equity (c) 8.6% 10.0% 13.1% 12.4% 13.0%
Stock Price / Dividend Ratios
Cash dividends per share 0.27 0.27 0.29 0.29 0.29
Dividend payout ratio (d) 58.4% 48.2% 39.7% 40.8% 38.7%
Closing stock price 32.60 31.90 34.36 34.99 38.75
Book value per share 22.48 22.84 23.07 23.68 24.32
For the Year
2001 2002
U.S. GAAP Earnings
Net income 60.1 77.7
Earnings per share
-Basic (a) 2.00 2.62
-Diluted (a) 1.91 2.53
U.S. GAAP Operating Results(b)
Non-interest income 257.0 264.2
Net interest income after loan losses 195.0 177.7
Investment income (loss) (8.2) (21.0)
Total revenues 443.8 420.9
Operating expenses 377.0 337.0
Income taxes 6.7 6.2
Net Income 60.1 77.7
Return on Equity (c) 9.5% 11.9%
Stock Price / Dividend Ratios
Cash dividends per share 0.98 1.08
Dividend payout ratio (d) 51.3% 42.7%
Closing stock price 48.00 31.90
Book value per share 21.04 22.84
Key: (a) Basic earnings per share is the result of dividing net income by
the average number of common shares outstanding. Diluted earnings
per share is computed in accordance with the Treasury Stock
method for dilutive securities as set out in SFAS 128.
(b) The following per share figures show the effect of non- core
items on diluted earnings per share.
BANK OF BERMUDA
CONSOLIDATED STATEMENT OF INCOME (U.S. GAAP)
(Unaudited, in U.S. dollars in thousands)
For the Quarter
2002 2003
3rd 4th 1st 2nd 3rd
Revenue
Non-interest income
Global fund services 32,203 30,755 31,829 33,339 37,382
Private trust services 7,500 7,235 7,684 8,013 8,150
Investment services 9,859 9,909 9,412 9,611 10,496
Foreign exchange earnings 10,923 11,566 11,704 14,088 13,556
Banking services 6,076 5,923 6,078 6,881 6,996
Other non-interest
income/(loss) (1) 1,757 7 3 4
Total non-interest income 66,560 67,145 66,714 71,935 76,584
Interest income
Interest on deposits 21,137 16,836 15,598 16,175 13,870
Interest on loans 22,401 22,196 21,632 22,670 23,030
Interest on marketable
securities – AFS 20,821 21,523 21,517 20,178 19,002
Interest on marketable
securities – trading 13,088 10,196 4,902 5,052 4,412
Total interest income 77,447 70,751 63,649 64,075 60,314
Interest expense 32,206 27,080 23,446 23,304 18,792
Net interest income 45,241 43,671 40,203 40,771 41,522
Provision for loan losses 1,429 (51) (753) (1,268) (530)
Net interest income after
loan losses 46,670 43,620 39,450 39,503 40,992
Investment loss – trading
portfolio (12,859) (3,092) (2,022) (3,356) (4,014)
Investment and other
income/(loss) (138) 1,600 2,987 4,828 3,487
Total revenue 100,233 109,273 107,129 112,910 117,049
Operating Expenses
Salaries 44,888 46,962 45,467 46,640 50,140
Pension and staff benefits 14,493 17,242 15,115 13,647 14,038
Property 6,883 7,332 7,066 6,995 7,535
Systems and communications 10,189 11,246 10,737 11,915 9,739
Corporate, marketing, and
other 7,590 9,729 5,585 11,531 11,463
Total operating expenses 84,043 92,511 83,970 90,728 92,915
Net Income, before Income
Taxes 16,190 16,762 23,159 22,182 24,134
Income taxes 2,130 168 1,547 1,619 1,842
Net Income 14,060 16,594 21,612 20,563 22,292
For the Year
2001 2002
Revenue
Non-interest income
Global fund services 117,682 126,152
Private trust services 30,427 30,323
Investment services 40,736 40,779
Foreign exchange earnings 42,394 42,365
Banking services 24,395 23,163
Other non-interest income/(loss) 1,343 1,474
Total non-interest income 256,977 264,256
Interest income
Interest on deposits 159,091 73,734
Interest on loans 104,171 89,260
Interest on marketable securities –
AFS 191,291 87,499
Interest on marketable securities –
trading 32,659 50,278
Total interest income 487,212 300,771
Interest expense 289,538 124,997
Net interest income 197,674 175,774
Provision for loan losses (2,662) 1,971
Net interest income after loan losses 195,012 177,745
Investment loss – trading portfolio (6,538) (24,900)
Investment and other income/(loss) (1,643) 3,896
Total revenue 443,808 420,997
Operating Expenses
Salaries 161,359 181,940
Pension and staff benefits 51,858 58,373
Property 28,613 27,723
Systems and communications 39,800 41,129
Corporate, marketing, and other 95,330 27,941
Total operating expenses 376,960 337,106
Net Income, before Income Taxes 66,848 83,891
Income taxes 6,771 6,233
Net Income 60,077 77,658
BANK OF BERMUDA
NON-CORE ITEMS
(Unaudited, in U.S. dollars in thousands)
For the Quarter
2002 2003
3rd 4th 1st 2nd 3rd
Non-Core Items
Non-Core investment loss (a) (954) — — — —
First Atlantic Commerce (b) — — — — —
Net recovery / (provision) for
litigation (c) — — 3,500 — —
Adjustments to performance-
related compensation due to
litigation (d) — — (296) — —
Pension credit (e) — — — — —
Restructuring charge (f) — — — — —
Cancelled start-up costs (g) — — — — —
Gain on sale of property (h) 1,291 — — 649 —
Loss on impairment of property (i) (2,472) — — — —
Total Non-Core items (2,135) — 3,204 649 —
For the Year
2001 2002
Non-Core Items
Non-Core investment loss (a) (9,615) (954)
First Atlantic Commerce (b) 2,300 —
Net recovery / (provision) for
litigation (c) (43,437) 5,453
Adjustments to performance-
related compensation due to
litigation (d) 9,330 (709)
Pension credit (e) 4,068 —
Restructuring charge (f) — (1,500)
Cancelled start-up costs (g) (7,699) —
Gain on sale of property (h) — 1,291
Loss on impairment of property (i) — (2,472)
Total Non-Core items (45,053) 1,109
Key: Item (a) is included in Investment and other income / (loss)
Item (b) is included in Investment and other income / (loss)
Item (c) is included in Corporate, marketing and other
Item (d) is included in Salaries
Item (e) is included in Pension and staff benefits
Item (f) is included in Salaries
Item (g) is included in Corporate, marketing and other, in Staff
benefits and in Property
Item (h) is included in Investment and other income / (loss)
Item (i) is included in Investment and other income / (loss)
BANK OF BERMUDA
PER SHARE DATA
(Unaudited, in U.S. dollars in thousands, except per share amounts)
For the Quarter
2002 2003
3rd 4th 1st 2nd 3rd
U.S. GAAP Earnings per Share
-Basic (a) 0.48 0.57 0.75 0.72 0.78
-Diluted (a) 0.46 0.56 0.73 0.71 0.75
Non-Core Items(b)
Non-Core investment loss (0.03) — — — —
First Atlantic Commerce — — — — —
Net recovery / (provision) for
litigation — — 0.12 — —
Adjustments to performance-related
compensation due to litigation — — (0.01) — —
Pension credit — — — — —
Restructuring charge — — — — —
Cancelled start-up costs — — — — —
Gain on sale of property 0.04 — — 0.02 —
Loss on impairment of property (0.08) — — — —
Total Non-Core items (0.07) — 0.11 0.02 —
Average Shares Outstanding
-Basic 29,441 29,225 28,746 28,381 28,632
-Diluted 30,412 29,894 29,485 29,151 29,546
Cash Dividends per Share 0.27 0.27 0.29 0.29 0.29
Share Price
High 45.50 33.74 34.82 35.73 41.20
Low 29.90 26.75 30.10 32.75 34.98
Period End 32.60 31.90 34.36 34.99 38.75
For the Year
2001 2002
U.S. GAAP Earnings per Share
-Basic (a) 2.00 2.62
-Diluted (a) 1.91 2.53
Non-Core Items(b)
Non-Core investment loss (0.31) (0.03)
First Atlantic Commerce 0.07 —
Net recovery / (provision) for
litigation (1.38) 0.17
Adjustments to performance-related
compensation due to litigation 0.30 (0.02)
Pension credit 0.13 —
Restructuring charge — (0.05)
Cancelled start-up costs (0.25) —
Gain on sale of property — 0.04
Loss on impairment of property — (0.08)
Total Non-Core items (1.44) 0.03
Average Shares Outstanding
-Basic 29,977 29,601
-Diluted 31,386 30,691
Cash Dividends per Share 0.98 1.08
Share Price
High 50.23 50.00
Low 34.55 26.75
Period End 48.00 31.90
Key: (a) Basic earnings per share is the result of dividing net income by
the average number of common shares outstanding. Diluted
earnings per share is computed in accordance with the Treasury
Stock method for dilutive securities as set out in SFAS 128.
(b) The following per share figures show the effect of non-core
items on diluted earnings per share.
BANK OF BERMUDA
CONSOLIDATED BALANCE SHEET
(Unaudited, in U.S. dollars in millions)
For the Quarter
2002 2003
3rd 4th 1st 2nd 3rd
Assets
Cash and deposits with
banks 3,555.7 4,677.0 3,339.5 3,899.8 4,599.2
Marketable securities 4,724.2 4,369.9 4,450.0 4,709.9 4,757.5
Loans, less allowance
for loan losses 1,663.3 1,768.3 1,827.4 1,987.5 2,147.5
Premises and equipment 140.3 145.3 148.7 143.6 143.1
Accrued interest 28.3 29.5 24.4 19.1 17.7
Other assets 123.1 100.0 374.5 186.8 156.5
Total assets 10,234.9 11,090.0 10,164.5 10,946.7 11,821.5
Liabilities
Customer deposits
Demand 5,343.6 6,269.5 5,611.2 6,655.5 7,153.2
Term 4,050.1 3,895.7 3,698.5 3,205.5 3,613.7
Total customer
deposits 9,393.7 10,165.2 9,309.7 9,861.0 10,766.9
Accrued interest 11.9 12.7 8.0 44.7 8.6
Other liabilities 169.0 249.9 193.9 365.6 346.4
Total liabilities 9,574.6 10,427.8 9,511.6 10,271.3 11,121.9
Shareholders’ Equity
Common share capital 29.4 29.0 28.3 28.5 28.8
Share premium 397.8 384.5 362.9 365.7 373.3
Accumulated other
comprehensive income
/ (loss) (1.1) 5.9 5.7 13.0 15.4
Retained earnings 234.2 242.8 256.0 268.2 282.1
Total shareholders’
equity 660.3 662.2 652.9 675.4 699.6
Total
Liabilities and
Shareholders’
Equity 10,234.9 11,090.0 10,164.5 10,946.7 11,821.5
Impaired Loans
Loans 24.4 20.2 20.8 22.8 22.4
Related allowances for
loan losses
– Specific 5.5 3.8 3.7 3.4 3.6
– General 20.9 20.6 21.7 23.2 23.5
Total 26.4 24.4 25.4 26.6 27.1
Coverage ratio 108% 121% 122% 117% 121%
Net charge offs /
(recoveries) (0.9) 2.1 (0.2) 0.1 —
Capital Ratios
Tier I 15.2% 14.9% 14.8% 15.0% 14.3%
Total capital 15.7% 15.4% 15.3% 15.5% 14.8%
For the Year
2001 2002
Assets
Cash and deposits with banks 3,570.0 4,677.0
Marketable securities 5,467.9 4,369.9
Loans, less allowance for loan losses 1,477.6 1,768.3
Premises and equipment 139.1 145.3
Accrued interest 36.2 29.5
Other assets 117.3 100.0
Total assets 10,808.1 11,090.0
Liabilities
Customer deposits
Demand 5,356.8 6,269.5
Term 4,586.6 3,895.7
Total customer deposits 9,943.4 10,165.2
Accrued interest 17.7 12.7
Other liabilities 217.7 249.9
Total liabilities 10,178.8 10,427.8
Shareholders’ Equity
Common share capital 29.9 29.0
Share premium 422.2 384.5
Accumulated other comprehensive
income / (loss) (20.3) 5.9
Retained earnings 197.5 242.8
Total shareholders’ equity 629.3 662.2
Total Liabilities and
Shareholders’ Equity 10,808.1 11,090.0
Impaired Loans
Loans 25.7 20.2
Related allowances for loan losses
– Specific 7.5 3.8
– General 20.1 20.6
Total 27.6 24.4
Coverage ratio 107% 121%
Net charge offs / (recoveries) 1.1 1.2
Capital Ratios
Tier I 15.3% 14.9%
Total capital 15.8% 15.4%
BANK OF BERMUDA
CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited, in U.S.* dollars in millions)
For the Quarter
2002 2003
3rd 4th 1st 2nd 3rd
Balance, beginning of period 653.2 660.3 662.2 652.9 675.4
Net income 14.1 16.6 21.6 20.6 22.3
Common shares issued
– through dividend reinvestment plan 1.0 1.0 1.0 1.0 1.0
– through employee incentive plans 0.8 (1.5) (0.4) 3.1 (0.6)
Shares repurchased and cancelled (13.2) (17.2) (14.8) (2.1) —
Common shares held by affiliates 3.1 4.0 (8.1) 1.0 7.5
Net unrealised gains/(losses) on
available for sale securities 6.8 3.8 1.6 2.9 1.4
Cash dividends paid (8.0) (8.0) (8.4) (8.4) (8.4)
Translation gain/(loss) 2.5 3.2 (1.8) 4.4 1.0
Stamp duty on stock dividend — — — — —
Balance, end of period 660.3 662.2 652.9 675.4 699.6
For the Year
2001 2002
Balance, beginning of period 626.4 629.3
Net income 60.1 77.7
Common shares issued
– through dividend reinvestment plan 5.8 4.7
– through employee incentive plans 5.9 3.4
Shares repurchased and cancelled (19.3) (52.1)
Common shares held by affiliates 1.9 5.3
Net unrealised gains/(losses) on
available for sale securities (18.2) 14.7
Cash dividends paid (30.0) (32.3)
Translation gain/(loss) (2.7) 11.5
Stamp duty on stock dividend (0.6) —
Balance, end of period 629.3 662.2
Key: * In U.S. dollars except the Bank’s share capital denominated in
Bermuda dollars on the basis that Bermuda dollars are on par with
United States dollars. (1 Bermuda dollar = 1 United States dollar)
BANK OF BERMUDA
AVERAGE BALANCE SHEET
(Unaudited, in U.S. dollars in millions)
For the Quarter
2002
3rd 4th
Avg Avg Avg Avg
Balance Rate Balance Rate
Assets
Deposits with banks 3,490 2.39% 3,206 2.13%
Marketable securities
– AFS (interest earning) 3,226 2.56% 3,466 2.46%
– Trading 1,328 3.91% 1,062 3.81%
Loans
Bermuda 1,314 5.77% 1,347 5.60%
International 370 3.65% 363 3.72%
Total interest earning assets 9,728 3.16% 9,444 3.00%
Cash due from banks 52 56
Marketable securities
– AFS non-interest earning 110 84
Other assets 228 250
Total assets 10,118 9,834
Liabilities
Customer deposits
Bermuda – Demand 2,503 0.73% 2,511 0.62%
– Term 2,283 2.10% 2,207 1.92%
International – Demand 2,458 0.94% 2,348 0.81%
– Term 1,793 2.12% 1,724 1.89%
Total interest bearing deposits 9,037 1.41% 8,790 1.25%
Securities lending agreements 17 1.20% 1 0.00%
Total interest bearing liabilities 9,054 1.41% 8,791 1.25%
Non interest bearing deposits 247 257
Other liablilities 163 129
Shareholders’ Equity 654 657
Total liab. & shareholders’
equity 10,118 9,834
Net Interest Margin
Interest income / earning assets 3.16% 3.00%
Interest expense / earning assets 1.31% 1.16%
Net interest margin 1.85% 1.84%
For the Quarter
2003
1st 2nd 3rd
Avg Avg Avg Avg Avg Avg
Balance Rate Balance Rate Balance Rate
Assets
Deposits with banks 3,443 1.84% 3,522 1.84% 3,436 1.60%
Marketable securities
– AFS (interest
earning) 4,048 2.15% 4,036 2.01% 4,198 1.80%
– Trading 501 3.97% 502 4.03% 503 3.48%
Loans
Bermuda 1,436 5.34% 1,479 5.32% 1,544 5.11%
International 338 3.24% 362 3.43% 412 3.02%
Total interest earning assets 9,766 2.64% 9,901 2.60% 10,093 2.37%
Cash due from banks 78 27 34
Marketable securities
– AFS non-interest
earning 82 42 35
Other assets 267 272 253
Total assets 10,193 10,242 10,415
Liabilities
Customer deposits
Bermuda – Demand 2,575 0.54% 2,589 0.53% 2,756 0.34%
– Term 2,269 1.61% 2,080 1.64% 1,863 1.41%
International – Demand 2,571 0.66% 2,840 0.68% 3,073 0.52%
– Term 1,642 1.65% 1,480 1.76% 1,424 1.56%
Total interest bearing
deposits 9,057 1.04% 8,989 1.04% 9,116 0.81%
Securities lending agreements 31 0.78% 35 0.69% 144 0.49%
Total interest bearing
liabilities 9,088 1.04% 9,024 1.03% 9,260 0.81%
Non interest bearing deposits 328 340 321
Other liablilities 118 218 159
Shareholders’ Equity 659 660 675
Total liab. &
shareholders’ equity 10,193 10,242 10,415
Net Interest Margin
Interest income / earning
assets 2.64% 2.60% 2.37%
Interest expense /
earning assets 0.97% 0.94% 0.74%
Net interest margin 1.67% 1.66% 1.63%
For the Year
2001 2002
Avg Avg Avg Avg
Balance Rate Balance Rate
Assets
Deposits with banks 4,090 3.89% 3,180 2.30%
Marketable securities
– AFS (interest earning) 4,105 4.66% 3,411 2.57%
– Trading 623 5.24% 1,257 4.00%
Loans
Bermuda 1,162 7.19% 1,297 5.84%
International 321 6.43% 380 3.71%
Total interest earning assets 10,301 4.73% 9,525 3.16%
Cash due from banks 37 47
Marketable securities
– AFS non-interest earning 123 98
Other assets 366 310
Total assets 10,827 9,980
Liabilities
Customer deposits
Bermuda – Demand 2,273 1.73% 2,375 0.75%
– Term 2,706 3.58% 2,228 2.08%
International – Demand 2,221 2.42% 2,330 0.92%
– Term 2,485 4.01% 1,895 2.08%
Total interest bearing deposits 9,685 2.99% 8,828 1.41%
Securities lending agreements 1 0.00% 15 2.22%
Total interest bearing liabilities 9,686 2.99% 8,843 1.41%
Non interest bearing deposits 221 248
Other liablilities 274 236
Shareholders’ Equity 646 653
Total liab. & shareholders’
equity 10,827 9,980
Net Interest Margin
Interest income / earning assets 4.73% 3.16%
Interest expense / earning assets 2.81% 1.31%
Net interest margin 1.92% 1.85%
BANK OF BERMUDA
TRADING PORTFOLIO PERFORMANCE
(Unaudited in U.S. Dollars in thousands)
For the Quarter
2002
3rd 4th
Average trading portfolio balance 1,328,000 1,062,000
Gross interest income 13,088 3.91% 10,196 3.81%
Investment loss on trading portfolio* (12,406) (2,728)
Interest after investment loss 682 0.20% 7,468 2.79%
Management fees* (453) (364)
Net performance of trading portfolio 229 0.07% 7,104 2.65%
For the Quarter
2003
1st 2nd 3rd
Average trading portfolio
balance 500,565 502,214 503,049
Gross interest income 4,902 3.97% 5,052 4.03% 4,412 3.48%
Investment loss on
trading portfolio* (1,745) (3,094) (3,778)
Interest after investment
loss 3,157 2.56% 1,958 1.56% 634 0.50%
Management fees* (277) (262) (236)
Net performance of
trading portfolio 2,880 2.33% 1,696 1.35% 398 0.31%
For the Year
2001 2002
Average trading portfolio balance 623,000 1,257,000
Gross interest income 32,659 5.24% 50,278 4.00%
Investment loss on trading
portfolio* (5,569) (23,074)
Interest after investment loss 27,090 4.34% 27,204 2.16%
Management fees* (969) (1,826)
Net performance of trading portfolio 26,121 4.19% 25,378 2.02%
Key * Items included in Investment loss — trading portfolio in the
Consolidated Statement of Income (U.S. GAAP) </p> <datasource>Bank of Bermuda</datasource> </block> <block class=”contact”> <p>CONTACT: Alison J. Satasi, Head of Investor Relations of Bank of<br/>Bermuda, +1-441-299-6851, or facsimile, +1-441-299-6559,<br/><virtloc idsrc=”dummy” value=”dummy”>[email protected]</virtloc></p> </block> <block class=”website”> <p>Web site: <a>http://www.bankofbermuda.com/</a><br/><a>http://www.bankofbermuda.com/investorrelations/webcast.htm</a> </p> </block> </body.content>
