Recent Developments
For the year ended December 31, 2023, the Bank reported net income of $225.5 million, or $4.58 per diluted common share and core net income* of $231.5 million or $4.70 per diluted share. Net income and core net income* were up year-over-year 5.4% and 7.3%, respectively. For the year, our return on common equity was 24.2% and core return on tangible common equity* was 27.0%.
Butterfield’s strong performance in 2023 was driven by active balance sheet management and an enhanced focus on long-term client relationships. Our conservative and profitable business model, characterized by limited credit risk, a high fee income ratio, and strong cash liquidity, was validated during the systemic challenges faced by U.S. regional banks last year. Butterfield also benefited from a resilient deposit base diversified across jurisdictions, sectors, and currencies.
During the year we completed a number of strategic projects. These include our upgraded core banking system in Bermuda and Cayman and the onboarding of trust assets acquired from Credit Suisse.
In addition, we executed a significant group-wide restructuring program, which should improve operating efficiencies and help offset inflationary pressures and the expected impact of lower market interest rates on net interest income.
The Bank maintained its balanced capital return policy. The Board again declared a quarterly dividend of $0.44 per common share to be paid on March 11, 2024 to shareholders of record on February 26, 2024. During the fourth quarter of 2023, Butterfield repurchased 1.2 million common shares under the Bank’s share repurchase program. The Board approved a new share repurchase program on December 5, 2023 to replace its expiring program, authorizing the purchase of up to 3.5 million common shares through to December 31, 2024. The new share repurchase authorization took effect on December 15, 2023.
* IN US DOLLARS (With comparisons to the year ended 31 December 2022)
**Please refer to the “Reconciliation of Non-GAAP Financial Measures” in our published year end 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+