First Quarter 2024 Performance and Operational Highlights
- Net income of
$8.1 million, or$0.90 per diluted share - Core net income(1) of
$8.1 million, or$0.90 per diluted share(1) - Net interest income of $20.8 million, an increase of $435,000 from the prior quarter
- Net interest margin (“NIM”) of 3.59%, down 10 basis points from the prior quarter
- NIM of 3.60% on a fully-taxable equivalent basis (“NIM - FTE”)(1)
- Return on average assets (“ROAA”) of 1.33%; return on average stockholders’ equity (“ROAE”) of 14.87%; and return on average tangible common equity (“ROATCE”)(1) of 16.17%
- Core ROAA(1) of 1.34%; and core ROATCE(1) of 16.19%
- Efficiency ratio of 46.90%
- Linked-quarter loan growth of 17.2% annualized
- Linked-quarter total deposits grew 18.3% annualized
- Linked-quarter total deposits, excluding brokered deposits, grew 7.1% annualized
(1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
CEO Commentary |
“We grew our total loans by 17.2% annualized from the prior quarter, while our non-performing loans as a percentage of the total portfolio was just 0.18%. Our portfolio is in excellent shape. In addition to loan growth, we grew total non-brokered deposits by 7.1% annualized, and net interest income expanded by 2.1% as we benefited from higher yields on earning assets. While funding expenses remained elevated amid the higher-for-longer interest rate environment, resulting in continued pressure on our net interest margin, the rate of cost increases leveled off during the first quarter, and our NIM remained healthy at 3.59%.” | ||||
“With liquidity and capital levels, Southern States is well well-positioned to drive further growth across our footprint, which includes economically dynamic markets throughout |
Net Interest Income and Net Interest Margin |
Three Months Ended | % Change | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Average interest-earning assets | $ | 2,336,369 | $ | 2,195,381 | $ | 1,947,957 | 6.4 | % | 19.9 | % | |||||||
Net interest income | $ | 20,839 | $ | 20,404 | $ | 19,546 | 2.1 | % | 6.6 | % | |||||||
Net interest margin | 3.59 | % | 3.69 | % | 4.07 | % | (10)bps | (48)bps | |||||||||
Net interest income for the first quarter of 2024 was
Relative to the first quarter of 2023, net interest income increased
Net interest margin for the first quarter of 2024 was 3.59%, compared to 3.69% for the fourth quarter of 2023. The decrease was primarily due to an increase in the cost of interest-bearing deposits, which was greater than the increase in the yield on interest-earning assets.
Relative to the first quarter of 2023, net interest margin decreased from 4.07%. The decrease was primarily the result of the rapid increase in interest rates, which accelerated the cost of interest-bearing liabilities at a greater pace than the yield received on interest-earning assets. A shift from noninterest-bearing deposits into interest-bearing deposits also had a negative impact on net interest margin.
Noninterest Income |
Three Months Ended | % Change | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Service charges on deposit accounts | $ | 463 | $ | 441 | $ | 450 | 5.0 | % | 2.9 | % | ||||||
Swap fees | 15 | 70 | (4 | ) | (78.6)% | (475.0)% | ||||||||||
SBA/ | 64 | 70 | 134 | (8.6)% | (52.2)% | |||||||||||
Mortgage origination fees | 96 | 87 | 100 | 10.3 | % | (4.0)% | ||||||||||
Net (loss) gain on securities | (12 | ) | 98 | 514 | (112.2)% | (102.3)% | ||||||||||
Other operating income | 642 | 2,352 | 592 | (72.7)% | 8.4 | % | ||||||||||
Total noninterest income | $ | 1,268 | $ | 3,118 | $ | 1,786 | (59.3)% | (29.0)% | ||||||||
Noninterest income for the first quarter of 2024 was
Relative to the first quarter of 2023, noninterest income decreased 29.0% from
Noninterest Expense |
Three Months Ended | % Change | |||||||||||||
(Dollars in thousands) | ||||||||||||||
Salaries and employee benefits | $ | 6,231 | $ | 5,739 | $ | 6,311 | 8.6 | % | (1.3)% | |||||
Equipment and occupancy expenses | 689 | 681 | 683 | 1.2 | % | 0.9 | % | |||||||
Data processing fees | 643 | 639 | 593 | 0.6 | % | 8.4 | % | |||||||
Regulatory assessments | 360 | 355 | 342 | 1.4 | % | 5.3 | % | |||||||
Other operating expenses | 2,452 | 2,303 | 2,229 | 6.5 | % | 10.0 | % | |||||||
Total noninterest expenses | $ | 10,375 | $ | 9,717 | $ | 10,158 | 6.8 | % | 2.1 | % | ||||
Noninterest expense for the first quarter of 2024 was
Relative to the first quarter of 2023, noninterest expense increased 2.1% from
Loans and Credit Quality |
Three Months Ended | % Change | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Gross loans | $ | 1,971,396 | $ | 1,890,677 | $ | 1,650,929 | 4.3 | % | 19.4 | % | |||||||
Unearned income | (6,247 | ) | (6,169 | ) | (5,614 | ) | 1.3 | % | 11.3 | % | |||||||
Loans, net of unearned income (“Loans”) | 1,965,149 | 1,884,508 | 1,645,315 | 4.3 | % | 19.4 | % | ||||||||||
Average loans, net of unearned (“Average loans”) | $ | 1,916,288 | $ | 1,814,484 | $ | 1,609,564 | 5.6 | % | 19.1 | % | |||||||
Nonperforming loans (“NPL”) | $ | 3,446 | $ | 1,177 | $ | 1,646 | 192.8 | % | 109.4 | % | |||||||
Provision for credit losses | $ | 1,236 | $ | 2,579 | $ | 1,181 | (52.1)% | 4.7 | % | ||||||||
Allowance for credit losses (“ACL”) | $ | 25,144 | $ | 24,378 | $ | 19,855 | 3.1 | % | 26.6 | % | |||||||
Net charge-offs | $ | 470 | $ | 382 | $ | 197 | 23.0 | % | 138.6 | % | |||||||
NPL to gross loans | 0.17 | % | 0.06 | % | 0.10 | % | |||||||||||
Net charge-offs to average loans(1) | 0.10 | % | 0.08 | % | 0.05 | % | |||||||||||
ACL to loans | 1.28 | % | 1.29 | % | 1.21 | % | |||||||||||
(1) Ratio is annualized. | |||||||||||||||||
Loans, net of unearned income, were
Nonperforming loans totaled
The Company recorded a provision for credit losses of
Net charge-offs for the first quarter of 2024 were
The Company’s allowance for credit losses was 1.28% of total loans and 729.66% of nonperforming loans at
Deposits |
Three Months Ended | % Change | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Noninterest-bearing deposits | $ | 416,704 | $ | 437,959 | $ | 433,833 | (4.9)% | (3.9)% | |||||||||
Interest-bearing deposits | 1,693,094 | 1,580,230 | 1,355,658 | 7.1 | % | 24.9 | % | ||||||||||
Total deposits | $ | 2,109,798 | $ | 2,018,189 | $ | 1,789,491 | 4.5 | % | 17.9 | % | |||||||
Uninsured deposits | $ | 610,122 | $ | 615,651 | $ | 567,709 | (0.9)% | 7.5 | % | ||||||||
Uninsured deposits to total deposits | 28.92 | % | 30.51 | % | 31.72 | % | |||||||||||
Noninterest deposits to total deposits | 19.75 | % | 21.70 | % | 24.24 | % | |||||||||||
Total deposits were
Capital |
2024 | 2023 | 2023 | |||||||||||||||
Company | Bank | Company | Bank | Company | Bank | ||||||||||||
Tier 1 capital ratio to average assets | 8.79 | % | 11.67 | % | 8.99 | % | 12.01 | % | 8.89 | % | 12.19 | % | |||||
Risk-based capital ratios: | |||||||||||||||||
Common equity tier 1 (“CET1”) capital ratio | 9.39 | % | 12.47 | % | 9.20 | % | 12.30 | % | 9.00 | % | 12.34 | % | |||||
Tier 1 capital ratio | 9.39 | % | 12.47 | % | 9.20 | % | 12.30 | % | 9.00 | % | 12.34 | % | |||||
Total capital ratio | 14.42 | % | 13.63 | % | 14.29 | % | 13.45 | % | 14.41 | % | 13.38 | % | |||||
As of
About |
Headquartered in
Forward-Looking Statements |
This press release contains forward-looking statements within the meaning of the federal securities laws, which reflect our current expectations and beliefs with respect to, among other things, future events and our financial performance. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. This may be especially true given recent events and trends in the banking industry and the inflationary environment. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the dates made, we cannot give any assurance that such expectations will prove correct and actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company’s Annual Report on Form 10-K for the year ended
These statements are often, but not always, made through the use of words or phrases such as “may,” “can,” “should,” “could,” “to be,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “likely,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “target,” “project,” “would” and “outlook,” or the negative version of those words or other similar words or phrases of a future or forward-looking nature. Forward-looking statements appear in a number of places in this press release and may include statements about our acquisition of
Contact Information |
(205) 820-8065 | (310) 622-8245 | |||
ljoyce@ssbank.bank | ssbankir@finprofiles.com |
SELECT FINANCIAL DATA | |||||||||||
(Dollars in thousands, except share and per share amounts) | |||||||||||
Three Months Ended | |||||||||||
Results of Operations | |||||||||||
Interest income | $ | 38,736 | $ | 36,172 | $ | 28,699 | |||||
Interest expense | 17,897 | 15,768 | 9,153 | ||||||||
Net interest income | 20,839 | 20,404 | 19,546 | ||||||||
Provision for credit losses | 1,236 | 2,579 | 1,181 | ||||||||
Net interest income after provision | 19,603 | 17,825 | 18,365 | ||||||||
Noninterest income | 1,268 | 3,118 | 1,786 | ||||||||
Noninterest expense | 10,375 | 9,717 | 10,158 | ||||||||
Income tax expense | 2,377 | 2,330 | 2,322 | ||||||||
Net income | $ | 8,119 | $ | 8,896 | $ | 7,671 | |||||
Core net income(1) | $ | 8,128 | $ | 7,289 | $ | 7,280 | |||||
Share and Per Share Data | |||||||||||
Shares issued and outstanding | 8,894,794 | 8,841,349 | 8,723,763 | ||||||||
Weighted average shares outstanding: | |||||||||||
Basic | 8,913,477 | 8,864,734 | 8,762,450 | ||||||||
Diluted | 9,043,122 | 9,021,358 | 9,044,490 | ||||||||
Earnings per share: | |||||||||||
Basic | $ | 0.91 | $ | 1.00 | $ | 0.87 | |||||
Diluted | 0.90 | 0.99 | 0.85 | ||||||||
Core - diluted(1) | 0.90 | 0.81 | 0.80 | ||||||||
Book value per share | 25.06 | 24.31 | 21.74 | ||||||||
Tangible book value per share(1) | 23.07 | 22.30 | 19.68 | ||||||||
Cash dividends per common share | 0.09 | 0.09 | 0.09 | ||||||||
Performance and Financial Ratios | |||||||||||
ROAA | 1.33 | % | 1.53 | % | 1.51 | % | |||||
ROAE | 14.87 | % | 17.02 | % | 16.67 | % | |||||
Core ROAA(1) | 1.34 | % | 1.26 | % | 1.44 | % | |||||
ROATCE(1) | 16.17 | % | 18.62 | % | 18.45 | % | |||||
Core ROATCE(1) | 16.19 | % | 15.26 | % | 17.51 | % | |||||
NIM | 3.59 | % | 3.69 | % | 4.07 | % | |||||
NIM - FTE(1) | 3.60 | % | 3.71 | % | 4.09 | % | |||||
Net interest spread | 2.63 | % | 2.73 | % | 3.33 | % | |||||
Yield on loans | 7.06 | % | 6.91 | % | 6.38 | % | |||||
Yield on interest-earning assets | 6.67 | % | 6.54 | % | 5.97 | % | |||||
Cost of interest-bearing liabilities | 4.04 | % | 3.81 | % | 2.64 | % | |||||
Cost of funds(2) | 3.27 | % | 3.03 | % | 2.01 | % | |||||
Cost of interest-bearing deposits | 3.92 | % | 3.66 | % | 2.42 | % | |||||
Cost of total deposits | 3.12 | % | 2.86 | % | 1.81 | % | |||||
Noninterest deposits to total deposits | 19.75 | % | 21.70 | % | 24.24 | % | |||||
Core deposits to total deposits | 81.45 | % | 83.70 | % | 88.57 | % | |||||
Uninsured deposits to total deposits | 28.92 | % | 30.51 | % | 31.72 | % | |||||
Total loans to total deposits | 93.14 | % | 93.38 | % | 91.94 | % | |||||
Efficiency ratio | 46.90 | % | 41.48 | % | 48.79 | % | |||||
Core efficiency ratio(1) | 46.90 | % | 45.78 | % | 48.79 | % | |||||
(1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
(2) Includes total interest-bearing liabilities and noninterest deposits.
SELECT FINANCIAL DATA | |||||||||||
(Dollars in thousands) | |||||||||||
Three Months Ended | |||||||||||
Financial Condition (ending) | |||||||||||
Total loans | $ | 1,965,149 | $ | 1,884,508 | $ | 1,645,315 | |||||
Total securities | 197,006 | 198,632 | 183,197 | ||||||||
Total assets | 2,510,975 | 2,446,663 | 2,135,622 | ||||||||
Total noninterest bearing deposits | 416,704 | 437,959 | 433,833 | ||||||||
Total core deposits(1) | 1,718,333 | 1,689,266 | 1,584,915 | ||||||||
Total deposits | 2,109,798 | 2,018,189 | 1,789,491 | ||||||||
Total borrowings | 146,773 | 183,673 | 131,372 | ||||||||
Total liabilities | 2,288,094 | 2,231,699 | 1,945,959 | ||||||||
Total shareholders’ equity | 222,881 | 214,964 | 189,663 | ||||||||
Financial Condition (average) | |||||||||||
Total loans | $ | 1,916,288 | $ | 1,814,484 | $ | 1,609,564 | |||||
Total securities | 208,954 | 209,074 | 192,348 | ||||||||
Total other interest-earning assets | 211,127 | 171,823 | 146,045 | ||||||||
Total interest-bearing assets | 2,336,369 | 2,195,381 | 1,947,957 | ||||||||
Total assets | 2,447,278 | 2,303,398 | 2,057,005 | ||||||||
Total noninterest-bearing deposits | 416,141 | 420,019 | 438,735 | ||||||||
Total interest-bearing deposits | 1,633,307 | 1,502,348 | 1,300,632 | ||||||||
Total deposits | 2,049,448 | 1,922,367 | 1,739,367 | ||||||||
Total borrowings | 148,771 | 140,790 | 104,901 | ||||||||
Total interest-bearing liabilities | 1,782,078 | 1,643,138 | 1,405,533 | ||||||||
Total shareholders’ equity | 219,622 | 207,324 | 186,639 | ||||||||
Asset Quality | |||||||||||
Nonperforming loans | $ | 3,446 | $ | 1,177 | $ | 1,646 | |||||
Other real estate owned (“OREO”) | $ | 33 | $ | 33 | $ | 2,930 | |||||
Nonperforming assets (“NPA”) | $ | 3,479 | $ | 1,210 | $ | 4,576 | |||||
Net charge-offs to average loans(2) | 0.10 | % | 0.08 | % | 0.05 | % | |||||
Provision for credit losses to average loans(2) | 0.26 | % | 0.56 | % | 0.30 | % | |||||
ACL to loans | 1.28 | % | 1.29 | % | 1.21 | % | |||||
ACL to gross loans | 1.28 | % | 1.29 | % | 1.20 | % | |||||
ACL to NPL | 729.66 | % | 2071.20 | % | 1206.26 | % | |||||
NPL to loans | 0.18 | % | 0.06 | % | 0.10 | % | |||||
NPL to gross loans | 0.17 | % | 0.06 | % | 0.10 | % | |||||
NPA to gross loans and OREO | 0.18 | % | 0.06 | % | 0.28 | % | |||||
NPA to total assets | 0.14 | % | 0.05 | % | 0.21 | % | |||||
Regulatory and Other Capital Ratios | |||||||||||
Total shareholders’ equity to total assets | 8.88 | % | 8.79 | % | 8.88 | % | |||||
Tangible common equity to tangible assets(3) | 8.23 | % | 8.12 | % | 8.11 | % | |||||
Tier 1 capital ratio to average assets | 8.79 | % | 8.99 | % | 8.89 | % | |||||
Risk-based capital ratios: | |||||||||||
CET1 capital ratio | 9.39 | % | 9.20 | % | 9.00 | % | |||||
Tier 1 capital ratio | 9.39 | % | 9.20 | % | 9.00 | % | |||||
Total capital ratio | 14.42 | % | 14.29 | % | 14.41 | % | |||||
(1) We define core deposits as total deposits excluding brokered deposits and time deposits greater than
(2) Ratio is annualized.
(3) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION | |||||||||||
(Dollars in thousands) | |||||||||||
(Unaudited) | (Audited) | (Unaudited) | |||||||||
Assets | |||||||||||
Cash and due from banks | $ | 20,470 | $ | 19,710 | $ | 17,245 | |||||
Interest-bearing deposits in banks | 129,917 | 134,846 | 99,541 | ||||||||
Federal funds sold | 86,736 | 96,095 | 76,010 | ||||||||
Total cash and cash equivalents | 237,123 | 250,651 | 192,796 | ||||||||
Securities available for sale, at fair value | 177,379 | 179,000 | 163,550 | ||||||||
Securities held to maturity, at amortized cost | 19,627 | 19,632 | 19,647 | ||||||||
Other equity securities, at fair value | 3,638 | 3,649 | 3,806 | ||||||||
Restricted equity securities, at cost | 5,108 | 5,684 | 3,862 | ||||||||
Loans held for sale | 425 | 450 | 2,376 | ||||||||
Loans, net of unearned income | 1,965,149 | 1,884,508 | 1,645,315 | ||||||||
Less allowance for credit losses | 25,144 | 24,378 | 19,855 | ||||||||
Loans, net | 1,940,005 | 1,860,130 | 1,625,460 | ||||||||
Premises and equipment, net | 26,262 | 26,426 | 27,098 | ||||||||
Accrued interest receivable | 9,561 | 8,711 | 7,077 | ||||||||
Bank owned life insurance | 30,075 | 29,884 | 29,350 | ||||||||
Annuities | 15,939 | 15,036 | 15,489 | ||||||||
Foreclosed assets | 33 | 33 | 2,930 | ||||||||
16,862 | 16,862 | 16,862 | |||||||||
Core deposit intangible | 817 | 899 | 1,144 | ||||||||
Other assets | 28,121 | 29,616 | 24,175 | ||||||||
Total assets | $ | 2,510,975 | $ | 2,446,663 | $ | 2,135,622 | |||||
Liabilities and Stockholders' Equity | |||||||||||
Liabilities: | |||||||||||
Deposits: | |||||||||||
Noninterest-bearing | $ | 416,704 | $ | 437,959 | $ | 433,833 | |||||
Interest-bearing | 1,693,094 | 1,580,230 | 1,355,658 | ||||||||
Total deposits | 2,109,798 | 2,018,189 | 1,789,491 | ||||||||
Other borrowings | 7,997 | 26,994 | (16 | ) | |||||||
FHLB advances | 52,000 | 70,000 | 45,000 | ||||||||
Subordinated notes | 86,776 | 86,679 | 86,388 | ||||||||
Accrued interest payable | 1,805 | 1,519 | 844 | ||||||||
Other liabilities | 29,718 | 28,318 | 24,252 | ||||||||
Total liabilities | 2,288,094 | 2,231,699 | 1,945,959 | ||||||||
Stockholders' equity: | |||||||||||
Common stock | 44,746 | 44,479 | 43,798 | ||||||||
Capital surplus | 79,282 | 78,361 | 77,053 | ||||||||
Retained earnings | 109,838 | 102,523 | 80,642 | ||||||||
Accumulated other comprehensive loss | (8,401 | ) | (8,379 | ) | (9,846 | ) | |||||
Unvested restricted stock | (1,030 | ) | (466 | ) | (965 | ) | |||||
Vested restricted stock units | (1,554 | ) | (1,554 | ) | (1,019 | ) | |||||
Total stockholders' equity | 222,881 | 214,964 | 189,663 | ||||||||
Total liabilities and stockholders' equity | $ | 2,510,975 | $ | 2,446,663 | $ | 2,135,622 | |||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||
(Dollars in thousands, except per share amounts) | ||||||||||
Three Months Ended | ||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||||||
Interest income: | ||||||||||
Loans, including fees | $ | 33,628 | $ | 31,613 | $ | 25,335 | ||||
Taxable securities | 1,981 | 1,986 | 1,383 | |||||||
Nontaxable securities | 229 | 230 | 291 | |||||||
Other interest and dividends | 2,898 | 2,343 | 1,690 | |||||||
Total interest income | 38,736 | 36,172 | 28,699 | |||||||
Interest expense: | ||||||||||
Deposits | 15,906 | 13,869 | 7,768 | |||||||
Other borrowings | 1,991 | 1,899 | 1,385 | |||||||
Total interest expense | 17,897 | 15,768 | 9,153 | |||||||
Net interest income | 20,839 | 20,404 | 19,546 | |||||||
Provision for credit losses | 1,236 | 2,579 | 1,181 | |||||||
Net interest income after provision for credit losses | 19,603 | 17,825 | 18,365 | |||||||
Noninterest income: | ||||||||||
Service charges on deposit accounts | 463 | 441 | 450 | |||||||
Swap fees | 15 | 70 | (4 | ) | ||||||
SBA/ | 64 | 70 | 134 | |||||||
Mortgage origination fees | 96 | 87 | 100 | |||||||
Net (loss) gain on securities | (12 | ) | 98 | 514 | ||||||
Other operating income | 642 | 2,352 | 592 | |||||||
Total noninterest income | 1,268 | 3,118 | 1,786 | |||||||
Noninterest expenses: | ||||||||||
Salaries and employee benefits | 6,231 | 5,739 | 6,311 | |||||||
Equipment and occupancy expenses | 689 | 681 | 683 | |||||||
Data processing fees | 643 | 639 | 593 | |||||||
Regulatory assessments | 360 | 355 | 342 | |||||||
Other operating expenses | 2,452 | 2,303 | 2,229 | |||||||
Total noninterest expenses | 10,375 | 9,717 | 10,158 | |||||||
Income before income taxes | 10,496 | 11,226 | 9,993 | |||||||
Income tax expense | 2,377 | 2,330 | 2,322 | |||||||
Net income | $ | 8,119 | $ | 8,896 | $ | 7,671 | ||||
Basic earnings per share | $ | 0.91 | $ | 1.00 | $ | 0.87 | ||||
Diluted earnings per share | $ | 0.90 | $ | 0.99 | $ | 0.85 | ||||
AVERAGE BALANCE SHEET AND NET INTEREST MARGIN | |||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||
Average Balance | Interest | Yield/Rate | Average Balance | Interest | Yield/Rate | Average Balance | Interest | Yield/Rate | |||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||
Loans, net of unearned income(1) | $ | 1,916,288 | $ | 33,628 | 7.06 | % | $ | 1,814,484 | $ | 31,613 | 6.91 | % | $ | 1,609,564 | $ | 25,335 | 6.38 | % | |||||||||||
Taxable securities | 163,586 | 1,981 | 4.87 | % | 163,537 | 1,986 | 4.82 | % | 139,516 | 1,383 | 4.02 | % | |||||||||||||||||
Nontaxable securities | 45,368 | 229 | 2.03 | % | 45,537 | 230 | 2.00 | % | 52,832 | 291 | 2.24 | % | |||||||||||||||||
Other interest-earnings assets | 211,127 | 2,898 | 5.52 | % | 171,823 | 2,343 | 5.41 | % | 146,045 | 1,690 | 4.69 | % | |||||||||||||||||
Total interest-earning assets | $ | 2,336,369 | $ | 38,736 | 6.67 | % | $ | 2,195,381 | $ | 36,172 | 6.54 | % | $ | 1,947,957 | $ | 28,699 | 5.97 | % | |||||||||||
Allowance for credit losses | (24,313 | ) | (22,666 | ) | (20,493 | ) | |||||||||||||||||||||||
Noninterest-earning assets | 135,222 | 130,683 | 129,541 | ||||||||||||||||||||||||||
Total Assets | $ | 2,447,278 | $ | 2,303,398 | $ | 2,057,005 | |||||||||||||||||||||||
Liabilities and Stockholders’ Equity: | |||||||||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||
Interest-bearing transaction accounts | 85,858 | 26 | 0.12 | % | 86,163 | 23 | 0.11 | % | 93,951 | 20 | 0.08 | % | |||||||||||||||||
Savings and money market accounts | 902,361 | 8,804 | 3.92 | % | 885,548 | 8,445 | 3.78 | % | 806,001 | 5,040 | 2.54 | % | |||||||||||||||||
Time deposits | 645,088 | 7,076 | 4.41 | % | 530,637 | 5,401 | 4.04 | % | 400,680 | 2,708 | 2.74 | % | |||||||||||||||||
FHLB advances | 53,121 | 655 | 4.96 | % | 52,076 | 645 | 4.92 | % | 18,578 | 159 | 3.47 | % | |||||||||||||||||
Other borrowings | 95,650 | 1,336 | 5.62 | % | 88,714 | 1,254 | 5.61 | % | 86,323 | 1,226 | 5.76 | % | |||||||||||||||||
Total interest-bearing liabilities | $ | 1,782,078 | $ | 17,897 | 4.04 | % | $ | 1,643,138 | $ | 15,768 | 3.81 | % | $ | 1,405,533 | $ | 9,153 | 2.64 | % | |||||||||||
Noninterest-bearing liabilities: | |||||||||||||||||||||||||||||
Noninterest-bearing deposits | $ | 416,141 | $ | 420,019 | $ | 438,735 | |||||||||||||||||||||||
Other liabilities | 29,437 | 32,917 | 26,098 | ||||||||||||||||||||||||||
Total noninterest-bearing liabilities | $ | 445,578 | $ | 452,936 | $ | 464,833 | |||||||||||||||||||||||
Stockholders’ Equity | 219,622 | 207,324 | 186,639 | ||||||||||||||||||||||||||
Total Liabilities and Stockholders’ Equity | $ | 2,447,278 | $ | 2,303,398 | $ | 2,057,005 | |||||||||||||||||||||||
Net interest income | $ | 20,839 | $ | 20,404 | $ | 19,546 | |||||||||||||||||||||||
Net interest spread(2) | 2.63 | % | 2.73 | % | 3.33 | % | |||||||||||||||||||||||
Net interest margin(3) | 3.59 | % | 3.69 | % | 4.07 | % | |||||||||||||||||||||||
Net interest margin - FTE(4)(5) | 3.60 | % | 3.71 | % | 4.09 | % | |||||||||||||||||||||||
Cost of funds(6) | 3.27 | % | 3.03 | % | 2.01 | % | |||||||||||||||||||||||
Cost of interest-bearing deposits | 3.92 | % | 3.66 | % | 2.42 | % | |||||||||||||||||||||||
Cost of total deposits | 3.12 | % | 2.86 | % | 1.81 | % | |||||||||||||||||||||||
(1) Includes nonaccrual loans.
(2) Net interest spread is the difference between interest rates earned on interest earning assets and interest rates paid on interest-bearing liabilities.
(3) Net interest margin is a ratio of net interest income to average interest earning assets for the same period.
(4) Net interest margin - FTE is a ratio of fully-taxable equivalent net interest income to average interest earning assets for the same period. It assumes a 24.0% tax rate.
(5) Refer to “Reconciliation of Non-GAAP Financial Measures”.
(6) Includes total interest-bearing liabilities and noninterest deposits.
LOAN COMPOSITION | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Amount | % of gross | Amount | % of gross | Amount | % of gross | |||||||||||||||
Real estate mortgages: | ||||||||||||||||||||
Construction and development | $ | 252,934 | 12.8 | % | $ | 242,960 | 12.9 | % | $ | 227,560 | 13.8 | % | ||||||||
Residential | 238,702 | 12.1 | % | 224,603 | 11.9 | % | 196,923 | 11.9 | % | |||||||||||
Commercial | 1,182,634 | 60.0 | % | 1,144,867 | 60.5 | % | 948,251 | 57.5 | % | |||||||||||
Commercial and industrial | 288,701 | 14.7 | % | 269,961 | 14.3 | % | 270,825 | 16.4 | % | |||||||||||
Consumer and other | 8,425 | 0.4 | % | 8,286 | 0.4 | % | 7,370 | 0.4 | % | |||||||||||
Gross loans | 1,971,396 | 100.0 | % | 1,890,677 | 100.0 | % | 1,650,929 | 100.0 | % | |||||||||||
Unearned income | (6,247 | ) | (6,169 | ) | (5,614 | ) | ||||||||||||||
Loans, net of unearned income | 1,965,149 | 1,884,508 | 1,645,315 | |||||||||||||||||
Allowance for credit losses | (25,144 | ) | (24,378 | ) | (19,855 | ) | ||||||||||||||
Loans, net | $ | 1,940,005 | $ | 1,860,130 | $ | 1,625,460 | ||||||||||||||
DEPOSIT COMPOSITION | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Amount | % of total | Amount | % of total | Amount | % of total | ||||||||||||
Noninterest-bearing transaction | $ | 416,704 | 19.7 | % | $ | 437,959 | 21.7 | % | $ | 433,833 | 24.2 | % | |||||
Interest-bearing transaction | 974,079 | 46.2 | % | 946,347 | 46.9 | % | 877,166 | 49.0 | % | ||||||||
Savings | 33,909 | 1.6 | % | 35,412 | 1.7 | % | 47,742 | 2.7 | % | ||||||||
Time deposits, | 584,658 | 27.7 | % | 500,406 | 24.8 | % | 366,271 | 20.5 | % | ||||||||
Time deposits, over | 100,448 | 4.8 | % | 98,065 | 4.9 | % | 64,479 | 3.6 | % | ||||||||
Total deposits | $ | 2,109,798 | 100.0 | % | $ | 2,018,189 | 100.0 | % | $ | 1,789,491 | 100.0 | % | |||||
Nonperfoming Assets | |||||||||||
(Dollars in thousands) | |||||||||||
Nonaccrual loans | $ | 3,446 | $ | 1,017 | $ | 1,646 | |||||
Past due loans 90 days or more and still accruing interest | — | 160 | — | ||||||||
Total nonperforming loans | 3,446 | 1,177 | 1,646 | ||||||||
OREO | 33 | 33 | 2,930 | ||||||||
Total nonperforming assets | $ | 3,479 | $ | 1,210 | $ | 4,576 | |||||
Financial difficulty modification loans– nonaccrual(1) | 675 | 907 | 805 | ||||||||
Financial difficulty modification loans – accruing | 1,283 | 1,095 | 1,272 | ||||||||
Financial difficulty modification loans | $ | 1,958 | $ | 2,002 | $ | 2,077 | |||||
Allowance for credit losses | $ | 25,144 | $ | 24,378 | $ | 19,855 | |||||
Loans, net of unearned income at the end of the period | $ | 1,965,149 | $ | 1,884,508 | $ | 1,645,315 | |||||
Gross loans outstanding at the end of period | $ | 1,971,396 | $ | 1,890,677 | $ | 1,650,929 | |||||
Total assets | $ | 2,510,975 | $ | 2,446,663 | $ | 2,135,622 | |||||
Allowance for credit losses to nonperforming loans | 729.66 | % | 2071.20 | % | 1206.26 | % | |||||
Nonperforming loans to loans, net of unearned income | 0.18 | % | 0.06 | % | 0.10 | % | |||||
Nonperforming loans to gross loans | 0.17 | % | 0.06 | % | 0.10 | % | |||||
Nonperforming assets to gross loans and OREO | 0.18 | % | 0.06 | % | 0.28 | % | |||||
Nonperforming assets to total assets | 0.14 | % | 0.05 | % | 0.21 | % | |||||
Nonaccrual loans by category: | |||||||||||
Real estate mortgages: | |||||||||||
Construction & Development | $ | — | $ | — | $ | 64 | |||||
Residential Mortgages | 246 | 252 | 267 | ||||||||
Commercial Real Estate Mortgages | 2,422 | 765 | 1,263 | ||||||||
Commercial & Industrial | 778 | — | 51 | ||||||||
Consumer and other | — | — | 1 | ||||||||
Total | $ | 3,446 | $ | 1,017 | $ | 1,646 | |||||
(1) Financial difficulty modification loans are excluded from nonperforming loans unless they otherwise meet the definition of nonaccrual loans or are more than 90 days past due.
Allowance for Credit Losses | |||||||||||
(Dollars in thousands) | |||||||||||
Three Months Ended | |||||||||||
Average loans, net of unearned income | $ | 1,916,288 | $ | 1,814,484 | $ | 1,609,564 | |||||
Loans, net of unearned income | 1,965,149 | 1,884,508 | 1,645,315 | ||||||||
Gross loans | 1,971,396 | 1,890,677 | 1,650,929 | ||||||||
Allowance for credit losses at beginning of the period | 24,378 | 22,181 | 20,156 | ||||||||
Impact of adoption of ASC 326 | — | — | (1,285 | ) | |||||||
Charge-offs: | |||||||||||
Construction and development | — | — | — | ||||||||
Residential | 11 | — | — | ||||||||
Commercial | 27 | — | — | ||||||||
Commercial and industrial | 442 | 424 | 218 | ||||||||
Consumer and other | 15 | 2 | 6 | ||||||||
Total charge-offs | 495 | 426 | 224 | ||||||||
Recoveries: | |||||||||||
Construction and development | — | — | — | ||||||||
Residential | 8 | 4 | 11 | ||||||||
Commercial | — | — | — | ||||||||
Commercial and industrial | 16 | 39 | 14 | ||||||||
Consumer and other | 1 | 1 | 2 | ||||||||
Total recoveries | 25 | 44 | 27 | ||||||||
Net charge-offs | $ | 470 | $ | 382 | $ | 197 | |||||
Provision for credit losses | $ | 1,236 | $ | 2,579 | $ | 1,181 | |||||
Balance at end of the period | $ | 25,144 | $ | 24,378 | $ | 19,855 | |||||
Allowance for credit losses on unfunded commitments at beginning of the period | $ | 1,239 | $ | 1,524 | $ | — | |||||
Impact of adoption of ASC 326 | — | — | 1,285 | ||||||||
Provision (credit) for credit losses on unfunded commitments | 49 | (285 | ) | — | |||||||
Balance at the end of the period | $ | 1,288 | $ | 1,239 | $ | 1,285 | |||||
Allowance to loans, net of unearned income | 1.28 | % | 1.29 | % | 1.21 | % | |||||
Allowance to gross loans | 1.28 | % | 1.29 | % | 1.20 | % | |||||
Net charge-offs to average loans, net of unearned income(1) | 0.10 | % | 0.08 | % | 0.05 | % | |||||
Provision for credit losses to average loans, net of unearned income(1) | 0.26 | % | 0.56 | % | 0.30 | % |
(1) Ratio is annualized.
Reconciliation of Non-GAAP Financial Measures |
In addition to reporting GAAP results, the Company reports non-GAAP financial measures in this earnings release and other disclosures. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our performance. While we believe that these non-GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies.
The following table provides a reconciliation of the non-GAAP financial measures to their most directly comparable financial measure presented in accordance with GAAP.
Reconciliation of Non-GAAP Financial Measures | |||||||||||
(Dollars in thousands, except share and per share amounts | |||||||||||
Three Months Ended | |||||||||||
Net income | $ | 8,119 | $ | 8,896 | $ | 7,671 | |||||
Add: Net OREO gains | — | (154 | ) | — | |||||||
Less: Provision fee received on early loan payoff | — | 1,863 | — | ||||||||
Less: Net (loss) gain on securities | (12 | ) | 98 | 514 | |||||||
Less: Tax effect | 3 | (508 | ) | (123 | ) | ||||||
Core net income | $ | 8,128 | $ | 7,289 | $ | 7,280 | |||||
Average assets | $ | 2,447,278 | $ | 2,303,398 | $ | 2,057,005 | |||||
Core return on average assets | 1.34 | % | 1.26 | % | 1.44 | % | |||||
Net income | $ | 8,119 | $ | 8,896 | $ | 7,671 | |||||
Add: Net OREO gains | — | (154 | ) | — | |||||||
Add: Provision for credit losses | 1,236 | 2,579 | 1,181 | ||||||||
Less: Provision fee received on early loan payoff | — | 1,863 | — | ||||||||
Less: Net (loss) gain on securities | (12 | ) | 98 | 514 | |||||||
Add: Income taxes | 2,377 | 2,330 | 2,322 | ||||||||
Pretax pre-provision core net income | $ | 11,744 | $ | 11,690 | $ | 10,660 | |||||
Average assets | $ | 2,447,278 | $ | 2,303,398 | $ | 2,057,005 | |||||
Pretax pre-provision core return on average assets | 1.93 | % | 2.01 | % | 2.10 | % | |||||
Net interest income | $ | 20,839 | $ | 20,404 | $ | 19,546 | |||||
Add: Fully-taxable equivalent adjustments(1) | 73 | 99 | 85 | ||||||||
Net interest income - FTE | $ | 20,912 | $ | 20,503 | $ | 19,631 | |||||
Net interest margin | 3.59 | % | 3.69 | % | 4.07 | % | |||||
Effect of fully-taxable equivalent adjustments(1) | 0.01 | % | 0.02 | % | 0.02 | % | |||||
Net interest margin - FTE | 3.60 | % | 3.71 | % | 4.09 | % | |||||
Total stockholders' equity | $ | 222,881 | $ | 214,964 | $ | 189,663 | |||||
Less: Intangible assets | 17,679 | 17,761 | 18,006 | ||||||||
Tangible common equity | $ | 205,202 | $ | 197,203 | $ | 171,657 | |||||
(1) Assumes a 24.0% tax rate. | |||||||||||
Reconciliation of Non-GAAP Financial Measures | |||||||||||
(Dollars in thousands, except share and per share amounts | |||||||||||
Three Months Ended | |||||||||||
Core net income | $ | 8,128 | $ | 7,289 | $ | 7,280 | |||||
Diluted weighted average shares outstanding | 9,043,122 | 9,021,358 | 9,044,490 | ||||||||
Diluted core earnings per share | $ | 0.90 | $ | 0.81 | $ | 0.80 | |||||
Common shares outstanding at year or period end | 8,894,794 | 8,841,349 | 8,723,763 | ||||||||
Tangible book value per share | $ | 23.07 | $ | 22.30 | $ | 19.68 | |||||
Total assets at end of period | $ | 2,510,975 | $ | 2,446,663 | $ | 2,135,622 | |||||
Less: Intangible assets | 17,679 | 17,761 | 18,006 | ||||||||
Adjusted assets at end of period | $ | 2,493,296 | $ | 2,428,902 | $ | 2,117,616 | |||||
Tangible common equity to tangible assets | 8.23 | % | 8.12 | % | 8.11 | % | |||||
Total average shareholders equity | $ | 219,622 | $ | 207,324 | $ | 186,639 | |||||
Less: Average intangible assets | 17,730 | 17,809 | 18,055 | ||||||||
Average tangible common equity | $ | 201,892 | $ | 189,515 | $ | 168,584 | |||||
Net income to common shareholders | $ | 8,119 | $ | 8,896 | $ | 7,671 | |||||
Return on average tangible common equity | 16.17 | % | 18.62 | % | 18.45 | % | |||||
Average tangible common equity | $ | 201,892 | $ | 189,515 | $ | 168,584 | |||||
Core net income | $ | 8,128 | $ | 7,289 | $ | 7,280 | |||||
Core return on average tangible common equity | 16.19 | % | 15.26 | % | 17.51 | % | |||||
Net interest income | $ | 20,839 | $ | 20,404 | $ | 19,546 | |||||
Add: Noninterest income | 1,268 | 3,118 | 1,786 | ||||||||
Less: Provision fee received on early loan payoff | — | 1,863 | — | ||||||||
Less: Net (loss) gain on securities | (12 | ) | 98 | 514 | |||||||
Operating revenue | $ | 22,119 | $ | 21,561 | $ | 20,818 | |||||
Expenses: | |||||||||||
Total noninterest expense | $ | 10,375 | $ | 9,717 | $ | 10,158 | |||||
Less: Net OREO gains | — | (154 | ) | — | |||||||
Adjusted noninterest expenses | $ | 10,375 | $ | 9,871 | $ | 10,158 | |||||
Core efficiency ratio | 46.90 | % | 45.78 | % | 48.79 | % |
Source:
2024 GlobeNewswire, Inc., source