Recent Developments
Butterfield reported solid results for the second quarter of 2023, with net income of $61.0 million and core net income* of $57.0 million. The Bank reported a return on average common equity of 25.9% and core return on average tangible common equity* of 26.3 percent for the second quarter of 2023 with earnings per share of $1.22 and core earnings per share* of $1.14.
The net interest margin was 2.83% for the second quarter, a decrease of 5 basis points, with the cost of deposits rising to 127 basis points from 110 basis points in the prior quarter. Deposit pricing increased across jurisdictions as fixed term deposits rolled into higher pricing due to rising market interest rates. Butterfield’s business in the Channel Islands, which has a higher proportion of corporate banking customers, continues to be the most competitive market segment.
The Bank’s TCE/TA ratio of 6.5% has improved to the conservative end of the targeted range of between 6% and 6.5%. As a result, Butterfield was able to continue to execute its balanced capital return strategy, accelerating the share buy-back program in the second quarter, having repurchased approximately 723,000 shares in the quarter and expect to continue to repurchase shares throughout 2023, subject to market conditions. The Board again declared a quarterly dividend of $0.44 per common share to be paid on August 28, 2023 to shareholders of record on August 14, 2023.
During the quarter Moody’s assigned an A3 long-term deposit rating with a stable outlook to the Bank’s Cayman subsidiary in addition to reaffirming the Group rating, also at A3 (stable). This demonstrates the strength of the Bank’s Cayman business model and Butterfield’s ability to support the Cayman Islands market, which has benefited from steady economic growth, driven by resurgent tourism and a healthy financial services sector. In Bermuda, the Bank successfully implemented the upgrade of its core banking system and online platform and inaugurated a new flagship retail banking center in Hamilton.
As expected, the Bank completed the second closing of the planned acquisition of Credit Suisse trust assets. To date, 374 relationships representing $21.1 billion of AUA have now transferred to Butterfield, significantly expanding the Bank’s footprint in Asia.








* IN US DOLLARS (With comparisons to the quarter ended 30 June 2022)
** Please refer to the “Reconciliation of Non-GAAP Financial Measures” in our published second quarter 2023 results.
Capital Ratios
COMMON EQUITY TIER 1
31 Dec 2022 20.3%
TOTAL CAPITAL RATIO
31 Dec 2022 24.1%
Credit Ratings
Short-Term K1
Long-Term Senior A+
Short-Term P2
Long-Term Senior A3
Short-Term A2
Long-Term Senior BBB+