Heritage Financial Group, Inc. (NASDAQ: HBOS), the holding company for HeritageBank of the South, today announced unaudited financial results for the quarter and year ended December 31, 2013. Highlights of the Company's results for the year ended 2013 include:

  • Net income of $11.3 million or $1.50 per diluted share, up 67% from net income of $6.8 million or $0.85 per diluted share for the year ended 2012;
  • Excluding special items for each year, net income of $10.6 million or $1.42 per diluted share, up 86% from $5.7 million or $0.71 per diluted share for the year ended 2012 (see reconciliation of non-GAAP items);
  • Loan growth, excluding loans acquired through FDIC-assisted acquisitions, of $98.8 million or 17% from 2012;
  • A decline in the provision for loan losses, excluding FDIC-acquired loans, to $1.7 million, down 34% from $2.5 million for 2012;

Commenting on the results, Leonard Dorminey, President and Chief Executive Officer, said, "We are pleased to announce solid financial results for the fourth quarter and for all of 2013. Our team has been focused on several strategic initiatives, and we are excited to report that those efforts came to fruition in our financial results this past quarter. Contributing to our results were organic loan growth from commercial banking, fee income and improved efficiency from our branch network, fee income and growth in assets under management from our brokerage division, continued growth in mortgage banking, and significant gains on resolutions from our FDIC-acquired special asset team. We enter 2014 well positioned on all strategic fronts."

Dorminey also noted that the Company's Board of Directors has declared a quarterly cash dividend of $0.07 per share, resuming regular payments after a special dividend was paid in December 2012 in lieu of dividends for 2013. The new dividend will be paid on February 28, 2014, to stockholders of record as of February 14, 2014.

Operating Efficiency Initiatives

During 2013, the Company closed its branch in Vincent, Alabama, and its Broadway Avenue branch in Sylacauga, Alabama, both of which were added with the FDIC-assisted acquisition of Frontier Bank in March 2013. Also, the Company completed staffing reductions related to the Frontier acquisition that will result in a decrease of approximately $1.6 million from Frontier's pre-acquisition level of personnel expenses. Separately, the Company reduced Bank staffing by nine full-time equivalent employees, resulting in a one-time charge of $67,000 for severance ($60,000 in the third quarter of 2013 and $7,000 in the fourth quarter), and anticipates expense savings of approximately $460,000 per year related to this staffing reduction.

Commenting on the operating efficiency initiatives, Heath Fountain, Executive Vice President and Chief Financial Officer, said, "We continue to focus on improving our operating efficiency while expanding our mortgage and banking presence. While we have completed many efficiency initiatives, we anticipate building on the momentum gained in 2013 to further improve our operating efficiency in 2014."

Fourth Quarter 2013 Results of Operations

Highlights of the Company's results for the fourth quarter of 2013 include:

  • Net income of $3.4 million or $0.45 per diluted share, up 158% from $1.3 million or $0.18 per diluted share for the linked quarter and up 40% from $2.4 million or $0.31 per diluted share for the year-earlier quarter;
  • Excluding special items for each quarter, net income of $4.0 million or $0.53 per diluted share, up 124% from $1.8 million or $0.24 per diluted share for the linked quarter and up 221% from $1.2 million or $0.16 per diluted share for the year-earlier quarter (see reconciliation of non-GAAP items);
  • Loan growth, excluding loans acquired through FDIC-assisted acquisitions, of $19.0 million or 3% on a linked-quarter basis and $98.8 million or 17% compared with the year-earlier quarter;
  • A decrease in FDIC-acquired loans of $9.3 million, or 8%, on a linked-quarter basis, but an increase of $29.9 million or 36% compared with the year-earlier quarter;
  • A decrease in the provision for loan losses, excluding FDIC-acquired loans, to $220,000, down 37% from $350,000 for the linked quarter and down 63% compared with $600,000 for the year-earlier quarter;

The $2.1 million increase in reported quarterly earnings for the fourth quarter of 2013 compared with the linked quarter resulted primarily from the following items:

  • Increased loan discount accretion from FDIC-acquired loans of $2.3 million, partially offset by increased negative accretion of the FDIC loss-share receivable of $522,000;
  • Increased mortgage banking fees of $1.0 million;
  • Decreased FDIC-acquired other real estate owned write-downs and foreclosed asset expenses of $410,000;
  • Decreased legacy other real estate owned write-downs and foreclosed asset expenses of $394,000;
  • Increased interest income on core loans and loans held for sale of $385,000;
  • Decreased acquisition-related expenses of $178,000; offset by
  • Increased salaries and employee benefits of $614,000; and
  • Increased impairment loss on assets held for sale of $328,000.

Commenting on the fourth quarter results, Fountain added, "During the fourth quarter, we were able to resolve several FDIC-acquired non-covered loans that significantly improved our loan discount accretion income. Loan discount accretion income can vary significantly based on the timing of asset resolutions and will continue to cause volatility in earnings. We also posted a significant increase in our mortgage banking fees, building on the momentum that our mortgage division developed in the previous quarter."

The $977,000 increase in reported quarterly earnings for the fourth quarter of 2013 compared with the year-earlier quarter primarily resulted from the following items:

  • Improved net interest income of $1.7 million;
  • Decreased provision expense of $2.3 million;
  • Increased non-interest income of $1.4 million; offset by
  • Increased non-interest expense of $3.4 million.

Net interest income for the fourth quarter of 2013 increased 12% to $16.3 million from $14.5 million in the year-earlier quarter, primarily reflecting an increase in interest-earning assets related to both acquisitions and organic growth and a reduction in the cost of interest-bearing liabilities. The Company's net interest margin was 5.50% for the fourth quarter of 2013, a decline of 87 basis points from 6.37% for the year-earlier period. The reduction in net interest margin for the fourth quarter of 2013 compared with the year-earlier quarter was driven by a decline in the yield on loans, offset in part by an increase in the yield on investment securities coupled with a reduction in the cost of interest-bearing liabilities as rates continue to reset to lower levels and the Company takes advantage of historically low interest rates on non-deposit funding. Excluding FDIC-acquired loan discount adjustments from the net interest margin, the core net interest margin was 3.20% for the fourth quarter of 2013, a decrease of two basis points from 3.22% for the year-earlier quarter.

In the fourth quarter of 2013, the Company continued to achieve loan growth, with its core loan portfolio increasing $19.0 million organically on a linked-quarter basis and advancing $98.8 million overall compared with the year-earlier quarter. For the fourth quarter of 2013, the Company's loan portfolio, including FDIC-acquired loans, totaled $798.8 million, increasing $9.7 million on a linked-quarter basis from $789.1 million and from $670.0 million compared with the year-earlier quarter. The organic loan growth for the linked quarter was primarily driven by growth in Albany, Macon, and South Atlanta, Georgia markets, Auburn and Birmingham, Alabama markets, and the Ocala, Florida market. Total deposits stood at $1.076 billion at the end of the fourth quarter of 2013, up 2% from $1.052 billion on a linked-quarter basis, and up 24% from $869.6 million for the year-earlier quarter.

For the fourth quarter of 2013, the Company's loans held for sale totaled $110.7 million, increasing significantly by $72.6 million, or 191%, on a linked-quarter basis from $38.0 million, and increasing $95.1 million, or 609%, from $15.6 million compared with the year-earlier quarter. The significant increase in the loans held for sale for the current quarter was driven by a slowing in loan sales as the Company prepared to deliver directly to Fannie Mae. Loan sales to Fannie Mae for the fourth quarter totaled $20.8 million and, separately, the Company recorded a gain of $202,000 related to the mortgage servicing rights for those loans. Total mortgage production for the fourth quarter was $120.4 million, up 4% on a linked-quarter basis from $115.3 million and up 116% from $55.8 million compared with the year-earlier quarter.

Non-interest income for the fourth quarter of 2013 increased 47% to $4.5 million from $3.1 million in the year-earlier quarter, primarily driven by increases in mortgage banking fees of $1.5 million and service charges on deposit accounts of $335,000 and a decline in negative accretion for the FDIC loss-share receivable of $552,000, together which were partially offset by a decline in the gain on sales of securities of $1.2 million. Non-interest expense for the fourth quarter of 2013 increased 28% to $15.7 million from $12.3 million in the year-earlier quarter, primarily driven by increases in salaries and employee benefits of $2.6 million, impairment loss on assets held for sale of $328,000 and realized loss on assets held for sale of $228,000. The increase in salaries and employee benefits was associated with the hiring of employees from the Frontier acquisition and for the mortgage division expansion, while the impairment loss on assets held for sale was driven by two former branch buildings and a corporate facility the Company holds, and the realized loss on assets held for sale was the result of the Company selling its former corporate headquarters building in Albany, Georgia.

Accounting for FDIC-Assisted Acquisitions

The Company performs ongoing assessments of the estimated cash flows of its FDIC-acquired loan portfolios. The fair value of the FDIC-acquired loan portfolios consisted of $50.9 million in covered and $63.3 million in non-covered loans at the end of the fourth quarter of 2013 compared with $72.4 million in covered and $11.9 million in non-covered loans for the year-earlier quarter. The outstanding principal balance of the FDIC-acquired loan portfolios totaled $177.8 million at the end of the fourth quarter of 2013 compared with $152.1 million for the year-earlier quarter. The details of the accounting for the FDIC-acquired loan portfolios for the fourth quarter of 2013 are as follows:

  • Covered FDIC-acquired loans decreased $3.0 million from the linked quarter to $50.9 million;
  • Non-covered FDIC-acquired loans decreased $6.3 million to $63.3 million;
  • The FDIC loss-share receivable associated with covered assets acquired in FDIC-assisted acquisitions decreased $3.2 million to $41.3 million;
  • The negative accretion for the FDIC loss-share receivable was $2.0 million and the FDIC loss-share clawback accrual increased to $1.9 million;
  • Increase in provision expense for FDIC-acquired non-covered loans to $12,000;
  • Loan discount accretion recognized in interest income improved $2.6 million;
  • The non-accretable discount decreased $11.8 million to $36.7 million; and
  • The accretable discount increased $3.4 million to $26.9 million.

For the fourth quarter of 2013, loan discount accretion recognized in interest income improved 69% to $6.3 million from $3.7 million for the linked quarter, but declined 6% from $6.6 million for the year-earlier quarter. The FDIC loss-share receivable associated with covered FDIC-acquired assets decreased 7% to $41.3 million from $44.5 million for the linked quarter and declined 32% from $60.7 million for the year-earlier quarter. The reduction in the FDIC loss-share receivable for the linked quarter was primarily driven by negative accretion of $2.0 million affecting the loss-share receivable asset associated with the improvement in expected cash flows of the covered FDIC-acquired performing loan portfolios and FDIC reimbursements received of $1.2 million. An increase to the FDIC clawback liability accrual was recorded as an expense for the current quarter of $261,000, which increased the total accrual to $1.9 million. This clawback was caused by an improvement in estimates of expected cash flows for both FDIC-assisted acquisitions covered under loss-sharing agreements.

The covered FDIC-acquired loan discount affecting the loss-share receivable was $39.1 million, or 94.6% of the loss-share receivable, for the fourth quarter 2013 compared with $55.2 million, or 90.9% of the loss-share receivable, for the year-earlier quarter. The gross balance of covered FDIC-acquired assets decreased to $109.2 million for the fourth quarter of 2013 compared with $156.0 million for the year-earlier quarter. The FDIC loss-share receivable as a percent of the covered FDIC-acquired assets decreased to 37.8% compared with 38.9% for the year-earlier quarter.

Asset Quality

Total non-performing assets, excluding FDIC-acquired assets, decreased to $11.2 million, or 0.81% of total assets, compared with $13.6 million, or 1.03% of total assets, for the linked quarter and declined from $17.3 million, or 1.58% of total assets, for the year-earlier quarter. Annualized net charge-offs to average outstanding loans, excluding FDIC-acquired loans, were 0.10% for the fourth quarter of 2013 compared with 0.31% for the linked quarter and 0.05% for the year-earlier quarter. Non-performing loans, excluding FDIC-acquired loans, totaled $9.4 million, down from $11.0 million for the linked quarter and from $14.7 million for the year-earlier quarter. Other real estate owned and repossessed assets, excluding FDIC-acquired assets, totaled $1.8 million for the fourth quarter of 2013, down from $2.7 million for the linked quarter and from $2.6 million for the year-earlier quarter.

The provision for loan losses on non-FDIC-acquired loans decreased to $220,000 for the fourth quarter of 2013 from $350,000 for the linked quarter and from $600,000 for the year-earlier quarter, primarily driven by improving trends in total criticized and classified loans. For the fourth quarter in 2013, the allowance for loan losses represented 1.31% of total loans outstanding, excluding FDIC-acquired loans, versus 1.34% for the linked quarter and 1.55% for the year-earlier quarter. The improving loan loss allowance was primarily the result of declining criticized and classified loans as a percentage of total loans.

Capital Management Initiatives

The Company reinstated its regular quarterly dividend during January 2014 at $0.07 per share. Looking ahead, the Company intends to maintain its capital strength at the current level to support growth and its acquisition activities. The Company currently has authorization to purchase approximately 344,000 shares under the current repurchase program, which is set to expire in April 2014, unless extended or otherwise completed. Accordingly, future stock buybacks and future dividends will be premised largely on the Company's future earnings power rather than a return of capital to stockholders.

The Company's estimated total risk-based capital ratio at December 31, 2013, was 14.5%, significantly exceeding the required minimum of 10% to be considered a well-capitalized institution. The ratio of tangible common equity to total tangible assets was 8.8% as of December 31, 2013.

About Heritage Financial Group, Inc. and HeritageBank of the South

Heritage Financial Group, Inc. is the holding company for HeritageBank of the South, a community-oriented bank serving primarily South Georgia, North Central Florida and Eastern Alabama through 27 full-service branch locations, 14 mortgage offices, and 4 investment offices. As of December 31, 2013, the Company reported total assets of approximately $1.4 billion and total stockholders' equity of approximately $125 million. For more information about the Company, visit HeritageBank of the South on the Web at www.eheritagebank.com and see Investors.

Cautionary Note Regarding Forward Looking Statements

Except for historical information contained herein, the matters included in this news release and other information in the Company's filings with the Securities and Exchange Commission may contain certain "forward-looking statements," within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements can be identified by the fact that they do not relate strictly to historical or current facts and often use words or phrases "opportunities," "prospects," "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," "intends" or similar expressions. The forward-looking statements made herein represent the current expectations, plans or forecasts of the Company's future results and revenues. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Reform Act of 1995 and includes this statement for purposes of these safe harbor provisions. These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and are often beyond the Company's control. Actual outcomes and results may differ materially from those expressed in, or implied by, any of these forward-looking statements. Investors should not place undue reliance on any forward-looking statement and should consider the uncertainties and risks, discussed under Item 1A. "Risk Factors" of the Company's 2012 Annual Report on Form 10-K and in any of the Company's subsequent SEC filings. Further information concerning the Company and its business, including additional factors that could materially affect the Company's financial results, is included in its other filings with the SEC.

 

HERITAGE FINANCIAL GROUP, INC.

Unaudited Reconciliation of Non-GAAP Measures Presented in Earnings Release

(Dollars in thousands, except per share data)

       
Three Months Ended Twelve Months Ended

December 31,

December 31,   Sept. 30,
2013   2012 2013 2013   2012
Total interest income $ 18,115 $ 16,351 $ 15,393 $ 65,651 $ 54,738

Loan held for sale - fair value election

  -     -     -     -     (156 )
Adjusted interest income $ 18,115   $ 16,351   $ 15,393   $ 65,651   $ 54,582  
 
Total non-interest income $ 4,536 $ 3,092 $ 3,918 $ 18,414 $ 14,399
Mortgage banking activities - fair value election - - - - (336 )
Gain on sale of securities (85 ) (1,285 ) - (85 ) (2,838 )
(Gain) loss on acquisitions   -     -     -     (4,188 )   56  
Adjusted non-interest income $ 4,451   $ 1,738   $ 3,918   $ 14,141   $ 11,281  
 
Total non-interest expense $ 15,706 $ 12,314 $ 15,334 $ 58,951 $ 46,250

Salaries and employee benefits - early retirement and severance expense

(7 ) - (60 ) (67 ) (641 )
Acquisition-related expenses (102 ) (3 ) (280 ) (1,322 ) (418 )

Impairment loss on assets held for sale

(328 ) - - (328 ) -
Realized loss on the disposition of assets held for sale (226 ) - - (241 ) -
Accrual of FDIC acquisitions estimated clawback liability   (261 )   (219 )   (286 )   (1,237 )   (703 )
Adjusted non-interest expense $ 14,782   $ 12,092   $ 14,708   $ 55,756   $ 44,488  
 
Net income as reported $ 3,405 $ 2,428 $ 1,322 $ 11,315 $ 6,757
Total adjustments, net of tax* 589 (921 ) 462 (763 ) (1,094 )
Adjustment for state tax credits   -     (264 )   -     -     -  
Adjusted net income $ 3,994   $ 1,243   $ 1,784   $ 10,552   $ 5,663  
 
Diluted earnings per share $ 0.45 $ 0.31 $ 0.18 $ 1.52 $ 0.85
Total adjustments, net of tax*   0.08     (0.15 )   0.06     (0.12 )   (0.14 )

Adjusted diluted earnings per share

$ 0.53   $ 0.16   $ 0.24   $ 1.40   $ 0.71  
 

* The effective tax rate for the period presented is used to determine net of tax amounts.

 

Net Income and Diluted Earnings Per Share are presented in accordance with Generally Accepted Accounting Principles ("GAAP"). Adjusted Noninterest Income, Adjusted Noninterest Expense, Adjusted Net Income and Adjusted Diluted Earnings Per Share are non-GAAP financial measures. The Company believes that these non-GAAP measures aid in understanding and comparing current-year and prior-year results, both of which include unusual items of different natures. These non-GAAP measures should be viewed in addition to, and not as a substitute for, the Company's reported results.

   
Heritage Financial Group, Inc. and Subsidiary
Consolidated Balance Sheets
(Unaudited)
   
(Dollars in thousands)
 
(Unaudited)
December 31, December 31,
2013 2012*
 
 
Cash and due from banks $ 34,804 $ 23,993
Interest-bearing deposits in banks 3,249 15,393
Federal funds sold   130     4,306  
Cash and cash equivalents 38,183 43,692
 
Securities available for sale, at fair value 294,299 221,406
Federal Home Loan Bank stock, at cost 7,342 4,330
Other equity securities, at cost 1,010 1,010
Loans held for sale 110,669 15,608
Loans 747,862 597,579
Covered loans 50,891 72,425
Less allowance for loan losses   8,955     9,061  
Loans, net   789,798     660,943  
 
Other real estate owned 3,482 3,242
Covered other real estate owned   7,053     9,467  
Total other real estate owned   10,535     12,709  
 
FDIC loss-share receivable 41,306 60,731
Premises and equipment, net 37,978 33,015
Goodwill and intangible assets 4,253 4,235
Cash surrender value of bank owned life insurance 24,183 23,382
Other assets   21,369     16,445  
Total assets $ 1,380,925   $ 1,097,506  
 

LIABILITIES AND SHAREHOLDERS' EQUITY

 
Non-interest-bearing deposits $ 148,253 $ 116,272
Interest-bearing deposits   928,168     753,282  
Total deposits   1,076,421     869,554  
 
Federal funds purchased and securities sold under repurchase agreements 37,648 33,219
Other borrowings 131,394 60,000
Other liabilities   10,399     14,084  
Total liabilities   1,255,862     976,857  
 

SHAREHOLDERS' EQUITY

 

Preferred stock, par value; $0.01; 5,000,000 shares authorized; none issued

- -

Common stock, par value $0.01; 45,000,000 shares authorized; 7,834,537 and 8,172,486 shares issued and outstanding, respectively

78 82
Capital surplus 78,566 82,154
Retained earnings 57,614 46,299
Accumulated other comprehensive loss, net of tax of $5,175 and $2,566, respectively (7,762 ) (3,849 )
Unearned employee stock ownership plan (ESOP), 332,535 and 385,836 shares, respectively (3,433 )   (4,037 )
Total shareholders' equity   125,063     120,649  
 
Total liabilities & shareholders' equity $ 1,380,925   $ 1,097,506  
 
* Derived from Audited Consolidated Financial Statements.
           
Heritage Financial Group, Inc. and Subsidiary
Consolidated Statements of Income
(Unaudited)
 
(Dollars in thousands except share and per share data)
 
Three Months Ended Twelve Months Ended
December 31, December 31, December 31, December 31,
2013 2012 2013 2012
 

Interest income:

Interest and fees on loans $ 15,911 $ 15,084 $ 58,434 $ 48,831
Interest on loans held for sale 619 238 1,458 967
Interest on taxable securities 1,231 762 4,347 3,681
Interest on nontaxable securities 337 232 1,248 1,123
Interest on federal funds sold 2 9 9 30
Interest on deposits in other banks   15     26     155     106  
Total interest income   18,115     16,351     65,651     54,738  
 

Interest expense:

Interest on deposits 1,000 1,108 4,077 4,874
Interest on other borrowings   862     713     3,308     2,739  
Total interest expense   1,862     1,821     7,385     7,613  
 
Net interest income 16,253 14,530 58,266 47,125
 
Provision for loan losses   232     2,507     1,735     5,930  
 
Net interest income after provision for loan losses 16,021     12,023     56,531     41,195  
 

Non-interest income:

Service charges on deposit accounts 1,642 1,307 5,670 4,748
Bankcard services income 890 794 3,335 3,231
Other service charges, commissions and fees 121 89 513 326
Brokerage fees 560 463 2,138 1,838
Mortgage banking activities 2,949 1,451 10,509 4,768
Bank-owned life insurance 198 210 801 771
Gain on sales of securities 85 1,285 85 2,838
Gain (loss) on acquisitions - - 4,188 (56 )
Accretion of FDIC loss-share receivable (2,021 ) (2,573 ) (9,293 ) (4,325 )
Other   112     66     468     260  
Total non-interest income   4,536     3,092     18,414     14,399  

Non-interest expense:

Salaries and employee benefits 8,722 6,167 31,445 23,543
Equipment and occupancy 1,922 1,597 7,358 5,632
Advertising and marketing 299 147 1,170 656
Professional fees 559 387 1,416 1,319
Information services expenses 1,285 1,184 5,109 4,641

Loss (gain) on sales and write-downs of other real estate owned

38 277 406 219

Gain on sales and write-downs of FDIC-acquired other real estate owned

(536 ) (204 ) (969 ) (313 )
Foreclosed asset expenses 240 353 1,019 970
Foreclosed FDIC-acquired asset expenses 286 575 1,386 1,767
FDIC insurance and other regulatory fees 254 252 1,081 1,037
Impairment loss on assets held for sale 328 - 328 -
Acquisition related expenses 102 3 1,322 418
Deposit intangible expenses 200 191 809 781
FDIC loss-share clawback expenses 261 219 1,237 703
Other operating expenses   1,746     1,166     5,834     4,879  
Total non-interest expense   15,706     12,314     58,951     46,252  
 
Income before income taxes 4,851 2,801 15,994 9,342
 
Applicable income tax   1,446     373     4,679     2,585  
 
Net income $ 3,405   $ 2,428   $ 11,315   $ 6,757  
 

Earnings per common share:

Basic earnings per share $0.46   $0.31   $1.52   $0.85  
Diluted earnings per share $0.45   $0.31   $1.50   $0.85  
 

Weighted average-common shares outstanding:

Basic   7,407,722     7,720,839     7,421,348     7,969,104  
Diluted   7,530,606     7,722,867     7,528,246     7,970,903  
 
Heritage Financial Group, Inc. and Subsidiary
Consolidated Statements of Income
(Unaudited)
           
(Dollars in thousands except share and per share data)
 
 
Five Quarter Comparison
12/31/2013 9/30/2013   6/30/2013   3/31/2013   12/31/2012
 

Interest income:

Interest and fees on loans $ 15,911 $ 13,452 $ 15,702 $ 13,369 $ 15,084
Interest on loans held for sale 619 434 290 115 238
Interest on taxable securities 1,231 1,155 1,095 866 762
Interest on nontaxable securities 337 318 308 285 232
Interest on federal funds sold 2 4 2 1 9
Interest on deposits in other banks   15     30     88     22     26  
Total interest income   18,115     15,393     17,485     14,658     16,351  
 

Interest expense:

Interest on deposits 1,000 982 1,041 1,054 1,108
Interest on other borrowings   862     853     844     749     713  
Total interest expense   1,862     1,835     1,885     1,803     1,821  
 
Net interest income 16,253 13,558 15,600 12,855 14,530
 
 
Provision for loan losses 220 350 640 450 600
Provision for loan losses- FDIC-acquired covered - - 28 35 1,907
Provision for loan losses- FDIC-acquired non-covered 12 - - - -
                   
Net interest income after provision for loan losses   16,021     13,208     14,932     12,370     12,023  
 

Non-interest income:

Service charges on deposit accounts 1,642 1,577 1,297 1,154 1,307
Bankcard services income 890 852 831 762 794
Other service charges, commissions and fees 121 136 157 99 89
Brokerage fees 560 561 536 481 463
Mortgage banking activities 2,949 1,953 3,425 2,182 1,451
Bank-owned life insurance 198 200 201 202 210
Gain on sales of securities 85 - - - 1,285
Gain (loss) on acquisitions - - - 4,188 -
Accretion of FDIC loss-share receivable (2,021 ) (1,499 ) (3,376 ) (2,397 ) (2,573 )
Other   112     138     124     94     66  
Total non-interest income   4,536     3,918     3,195     6,765     3,092  

Non-interest expense:

Salaries and employee benefits 8,722 8,108 8,185 6,430 6,167
Equipment and occupancy 1,922 1,932 1,838 1,666 1,597
Advertising and marketing 299 335 349 187 147
Professional fees 559 340 302 215 387
Information services expenses 1,285 1,335 1,307 1,182 1,184

Loss (gain) on sales and write-downs of other real estate owned

38 335 58 (25 ) 277

(Gain) loss on sales and write-downs of FDIC-acquired other real estate owned

(536 ) (206 ) (251 ) 24 (204 )
Foreclosed asset expenses 240 337 227 215 353
Foreclosed FDIC-acquired asset expenses 286 366 313 421 575
FDIC insurance and other regulatory fees 254 293 278 256 252
Impairment loss on assets held for sale 328 - - - -
Acquisition related expenses 102 280 148 792 3
Deposit intangible expenses 200 204 211 194 191
FDIC loss-share clawback expenses 261 286 124 566 219
Other operating expenses   1,746     1,389     1,466     1,233     1,166  
Total non-interest expense   15,706     15,334     14,555     13,356     12,314  
 
Income before income taxes 4,851 1,792 3,572 5,779 2,801
 
Applicable income tax   1,446     470     912     1,851     373  
 
Net income $ 3,405   $ 1,322   $ 2,660   $ 3,928   $ 2,428  
 

Earnings per common share:

Basic earnings per share $0.46   $0.18   $0.36   $0.52   $0.31  
Diluted earnings per share $0.45   $0.18   $0.36   $0.52   $0.31  
Dividends $0.00   $0.00   $0.00   $0.00   $0.24  
 

Weighted average-common shares outstanding:

Basic 7,407,722   7,371,804   7,381,370   7,526,344   7,720,839  
Diluted 7,530,606   7,483,812   7,383,992   7,528,522   7,722,867  
   
Heritage Financial Group, Inc. and Subsidiary
Condensed Average Balances, Interest Rates and Yields
(Unaudited)
                     
(Dollars in thousands)
 
Three Months Ended Twelve Months Ended
December 31, December 31,
2013 2012 2013 2012
Average Average Average Average Average Average Average Average
Balance Interest   Rate Balance Interest   Rate Balance Interest   Rate Balance Interest   Rate

Interest-earning assets:

 
Loans(1)(2) $ 868,420 $ 16,536 7.55 % $ 658,346 $ 15,325 9.26 % $ 795,094 $ 59,907 7.53 % $ 608,722 $ 49,807 8.18 %
Investment securities (2) 299,638 1,683 2.23 % 211,524 1,073 2.02 % 283,782 6,020 2.12 % 240,198 5,186

2.16

%

Other short-term investments   13,785   16 0.46 %   42,264   35 0.33 %   41,576   164 0.39 %   38,782   137 0.35 %
Total interest-earning assets   1,181,843   18,235 6.12 %   912,134   16,433 7.17 %   1,120,452   66,091 5.90 %   887,702   55,130 6.21 %
 
Non-interest earning assets   169,547   174,694   175,168   183,373
Total assets $ 1,351,390 $ 1,086,828 $ 1,295,620 $ 1,071,075
 

Interest-bearing liabilities:

Deposits:

Interest checking, money market and savings $ 543,633 $ 343 0.25 % $ 452,243 $ 276 0.24 % $ 534,972 $ 1,261 0.24 % $ 465,954 $ 1,347 0.29 %
Time deposits   370,737   658 0.70 %   295,389   832 1.12 %   353,802   2,818 0.80 %   299,333   3,528 1.18 %
Total interest bearing-deposits   914,370   1,001 0.43 %   747,632   1,108 0.59 %   888,774   4,079 0.46 %   765,287   4,875 0.64 %
 

Federal Funds purchased and securities sold under repurchase agreements

36,548 337 3.66 % 34,324 336 3.89 % 34,527 1,331 3.85 % 33,528 1,333 3.98 %
Other Borrowings   114,041   525 1.83 %   50,489   377 2.97 %   96,132   1,976 2.06 %   38,975   1,406 3.61 %
Total interest-bearing liabilities   1,064,959   1,863 0.69 %   832,445   1,821 0.87 %   1,019,433   7,386 0.72 %   837,790   7,614 0.91 %
 

Non-interest bearing liabilities:

Demand Deposits 152,577 115,014 142,578 96,077
Other Liabilities   12,147   16,418   12,852   12,615
Total non-interest bearing liabilities   164,724   131,432   155,430   108,692
 
Total liabilities   1,229,683   963,877   1,174,863   946,482
 
Shareholders' equity 121,707 122,951 120,757 124,593
 
Total liabilities & shareholders' equity $ 1,351,390 $ 1,086,828 $ 1,295,620 $ 1,071,075
 
Net interest income $ 16,372 $ 14,612 $ 58,705 $ 47,516
 
Interest rate spread 5.43 % 6.30 % 5.17 % 5.30 %
 
Net yield on interest-earning assets (net interest margin) 5.50 % 6.37 % 5.24 % 5.35 %
 
Core net interest margin (non-GAAP):
Loans(1)(2) $ 868,420 $ 16,536 7.55 % $ 658,346 $ 15,325 9.26 % $ 795,094 $ 59,907 7.53 % $ 608,722 $ 49,807 8.18 %
FDIC-acquired loan discount adjustments(3)   69,283   6,272 35.92 %   73,309   6,646 36.07 %   73,647   20,722 28.14 %   86,382   15,709 18.19 %
Adjusted loans   937,703   10,264 4.34 %   731,655   8,679 4.72 %   868,741   39,185 4.51 %   695,104   34,098 4.91 %
                       

Adjusted total interest-earning assets

$ 1,251,126   11,963 3.79 % $ 985,443   9,787 3.95 % $ 1,194,099   45,369 3.80 % $ 974,084   39,421 4.05 %
                       

Total interest-bearing liabilities

$ 1,064,959   1,863 0.69 % $ 832,445   1,821 0.87 % $ 1,019,433   7,386 0.72 % $ 837,790   7,614 0.91 %
 
Core Net interest income $ 10,100 $ 7,966 $ 37,983 $ 31,807
 
Core Interest rate spread 3.10 % 3.08 % 3.07 % 3.14 %
 
Core Net yield on interest-earning assets (net interest margin non-GAAP) 3.20 % 3.22 % 3.18 % 3.27 %
 

(1)

Average loan balances includes nonaccrual loans for the periods presented.

(2)

Fully Taxable Equivalent ("FTE") at the rate of 34%. The FTE basis adjusts for the tax benefits of income on certain tax-exempt loans and investments using the federal statutory rate of 34% for each period presented. The Company believes this measure to be the preferred industry measurement of net interest income and provides relevant comparison between taxable and non-taxable amounts.

(3)

FDIC-acquired loan discount adjustments include the reduction of interest income for FDIC-acquired loan discount accretion excluding contractual interest payments and the increase of core loans for the total balance of FDIC-acquired loan discounts.

   
Heritage Financial Group, Inc. and Subsidiary
Consolidated Financial Highlights
(Unaudited)
       
(Dollars in thousands except share and per share data)
 
  Five Quarter Comparison

Financial Condition Data:

   12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 
Total loans $ 798,753 $ 789,092 $ 769,921 $ 752,866 $ 670,004
Loans held for sale 110,669 38,042 43,545 18,905 15,608
Covered loans 50,891 53,843 57,176 65,815 72,425
Allowance for loan losses 8,955 8,894 9,047 9,105 9,061
Total other real estate owned 10,535 10,244 11,949 13,851 12,709
Covered other real estate owned 7,053 5,909 7,815 9,460 9,467
FDIC loss-share receivable 41,306 44,527 48,106 52,012 60,731
Goodwill and intangible assets 4,253 4,251 4,455 4,666 4,235
Total assets 1,380,925 1,322,309 1,334,016 1,370,550 1,097,506
Non-interest-bearing deposits 148,253 153,163 148,219 151,709 116,272
Interest-bearing deposits 928,168 899,318 917,712 943,850 753,282
Other borrowings 131,394 101,667 101,940 102,210 60,000

Federal funds purchased and securities sold under agreement to repurchase

37,648 35,393 33,094 34,251 33,219
Stockholders' equity 125,063 120,534 118,540 120,655 120,649
 
Total shares outstanding 7,834,537 7,834,765 7,803,910 7,881,260 8,172,486
Unearned ESOP shares   332,535   345,860   359,186   372,511   385,836
Total shares outstanding net of unearned ESOP 7,502,002   7,488,905   7,444,724   7,508,749   7,786,650
 
Book value per share $ 16.67 $ 16.10 $ 15.92 $ 16.07 $ 15.49

Book value per share including unearned ESOP (non-GAAP)

15.96 15.38 15.19 15.31 14.76
Tangible book value per share (non-GAAP) 16.10 15.53 15.32 15.45 14.95

Tangible book value per share including unearned ESOP (non-GAAP)

15.42 14.84 14.62 14.72 14.24
Market value per share 19.25 17.42 14.75 14.48 13.79
                                 
 
                                 
 
Five Quarter Comparison
12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012

Key Financial Ratios and other information:

 
Performance Ratios
Annualized return on average assets 1.00% 0.40% 0.79% 1.37% 0.89%
Annualized return on average equity 11.10% 4.41% 8.74% 13.01% 7.90%
Net interest margin 5.50% 4.73% 5.61% 5.51% 6.37%
Net interest spread 5.43% 4.66% 5.55% 5.44% 6.30%
Core net interest margin 3.20% 3.23% 3.27% 3.35% 3.22%
Core net interest spread 3.10% 3.13% 3.17% 3.23% 3.08%
Efficiency ratio 71.66% 82.29% 74.17% 80.22% 69.50%
 
Capital Ratios
Average stockholders' equity to average assets 9.0% 9.0% 9.0% 10.5% 11.3%
Tangible equity to tangible assets (non-GAAP) 8.8% 8.8% 8.6% 8.5% 10.6%
Tier 1 leverage ratio 9.5% 9.4% 9.0% 10.4% 11.0%
Tier 1 risk-based capital ratio 13.5% 14.3% 14.3% 15.2% 17.2%
Total risk-based capital ratio 14.5% 15.4% 15.3% 16.3% 18.4%
 
Other Information
Full-time equivalent employees 426 412 401 355 321
Banking 306 308 316 285 264
Mortgage 113 97 79 64 50
Investments 7 7 6 6 7
Number of full-service offices 27 27 29 29 20
Mortgage loan offices 14 12 12 12 13
Investment offices 4 4 4 4 4
   
Heritage Financial Group, Inc. and Subsidiary
Consolidated Financial Highlights
(Unaudited)
       
(Dollars in thousands)
Five Quarter Comparison

Loans

   12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
Construction and land $ 50,167 $ 48,808 $ 42,753 $ 37,659 $ 33,340
Farmland 23,420 22,561 23,447 20,749 20,141
Permanent 1 - 4 174,565 169,105 166,199 163,302 161,883
Permanent 1 - 4 - junior liens and revolving 32,038 30,180 29,432 28,852 27,345
Multifamily 22,650 27,468 26,301 24,280 21,293
Nonresidential 256,567 250,859 234,259 225,946 212,570
Commercial business 101,161 95,108 88,828 83,015 83,659
Consumer and other   23,976   21,499   26,889   19,931   25,498
Total core loans $ 684,544 $ 665,588 $ 638,108 $ 603,734 $ 585,729
 
FDIC-acquired non-covered   63,318   69,661   74,637   83,317   11,850
Total loans   747,862   735,249   712,745   687,051   597,579
 
FDIC-acquired covered 50,891 53,843 57,176 65,815 72,425
 
Allowance for loan losses   8,955   8,894   9,047   9,105   9,061
$ 789,798 $ 780,198 $ 760,874 $ 743,761 $ 660,943
                                 
 
                                 

Loan Balances by Geographical Region (excluding FDIC- acquired loans):

Five Quarter Comparison
  12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 
Albany, Georgia $ 294,033 $ 288,089 $ 282,509 $ 273,116 $ 282,151
Valdosta, Georgia 100,936 101,729 96,485 90,385 84,198
Ocala, Florida 58,343 58,115 58,240 58,533 55,197
Statesboro, Georgia 122,928 124,667 118,056 107,650 103,176
Auburn, Alabama 36,130 31,485 26,061 24,386 20,149
Macon, Georgia 68,638 60,197 55,935 49,165 40,858
Birmingham, Alabama 1,590 344 822 499 -
South Atlanta   1,946   962   -   -   -
$ 684,544 $ 665,588 $ 638,108 $ 603,734 $ 585,729
                                 
 
                                 

Asset Quality Data (excluding FDIC -acquired loans):

  Five Quarter Comparison
  12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 
 
Nonaccrual loans $ 9,435 $ 10,986 $ 12,223 $ 12,723 $ 14,677
Loans - 90 days past due & still accruing   -   -   -   -   -
Total non-performing loans   9,435   10,986   12,223   12,723   14,677
 
OREO   1,789   2,654   3,046   3,028   2,620
Total non-performing assets $ 11,224 $ 13,640 $ 15,269 $ 15,751 $ 17,297
 
 
Trouble debt restructuring - nonaccrual $ 5,763 $ 5,840 $ 6,496 $ 4,593 $ 6,856
Trouble debt restructuring - accruing   1,983   1,996   2,009   2,023   7
Total trouble debt restructuring $ 7,746 $ 7,836 $ 8,505 $ 6,616 $ 6,863
 
Accruing past due loans $ 1,001 $ 669 $ 934 $ 1,316 $ 2,131
 
Total criticized assets 22,741 26,116 25,785 25,474 28,194
Total classified assets 19,582 23,048 22,985 22,118 25,129
 
Allowance for loan losses 8,955 8,894 9,047 9,105 9,061
Net charge-offs $ 160 $ 503 $ 698 $ 406 $ 68
 
 

Asset Quality Ratios:

 
Allowance for loan losses to total core loans 1.31% 1.34% 1.42% 1.51% 1.55%
Allowance for loan losses to average core loans 1.33% 1.37% 1.45% 1.53% 1.62%
Allowance for loan losses to non-performing loans 94.91% 80.96% 74.02% 71.56% 61.73%
Non-performing loans to total core loans 1.38% 1.65% 1.92% 2.11% 2.51%
Non-performing assets to total assets 0.81% 1.03% 1.14% 1.15% 1.58%
Net charge-offs to average core loans (annualized) 0.10% 0.31% 0.45% 0.27% 0.05%
   
Heritage Financial Group, Inc. and Subsidiary
Consolidated Financial Highlights
(Unaudited)
       
(Dollars in thousands)
  Five Quarter Comparison

FDIC-acquired assets

   12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 

FDIC-acquired non-covered loans:

Commercial real estate $ 22,268 $ 25,027 $ 27,258 $ 30,851 $ 6,359
Residential real estate 30,134 32,318 33,452 34,938 2,110
Construction and land 5,156 5,195 5,941 7,756 494
Commercial and industrial 2,604 3,638 4,106 5,125 1,574
Consumer and other   3,156   3,483   3,880   4,647   1,313
Total 63,318 69,661 74,637 83,317 11,850

FDIC-acquired covered loans:

Commercial real estate 14,161 14,956 15,384 18,849 21,820
Residential real estate 23,886 25,082 27,283 30,735 32,846
Construction and land 11,642 12,469 12,645 13,370 14,248
Commercial and industrial 864 924 1,340 2,216 2,670
Consumer and other   338   412   524   645   841
Total   50,891   53,843   57,176   65,815   72,425
Total carrying value of FDIC-acquired loans $ 114,209 $ 123,504 $ 131,813 $ 149,132 $ 84,275
Non-accrete discount for FDIC-acquired loans 36,746 48,545 55,170 59,558 46,000
Accretable discount for FDIC-acquired loans   26,860   23,445   23,007   26,136   21,834
Total discount for FDIC-acquired loans   63,606   71,990   78,177   85,694   67,834
Outstanding principal balance for FDIC-acquired loans $ 177,815 $ 195,494 $ 209,989 $ 234,826 $ 152,109
 

FDIC-acquired OREO:

Non-covered $ 1,694 $ 1,680 $ 1,087 $ 1,363 $ 602
Covered   7,053   5,909   7,815   9,460   9,467
Total carrying value of FDIC-acquired OREO $ 8,747 $ 7,589 $ 8,902 $ 10,823 $ 10,069
Total discount for FDIC-acquired OREO   11,186   12,038   11,013   12,176   11,690
Gross carrying value of FDIC-acquired OREO $ 19,933 $ 19,627 $ 19,915 $ 22,999 $ 21,759
 

Total loan discount accretion recognized in income:

Individual assessed discount accretion $ 3,132 $ 791 $ 2,336 $ 637 $ 2,515
Pooled assessed discount accretion   3,140   2,927   3,808   3,951   4,131
Total loan discount accretion recognized in income $ 6,272 $ 3,718 $ 6,144 $ 4,588 $ 6,646
 

FDIC-acquired ratios:

Total discount to principal balance for FDIC-acquired loans 35.8% 36.8% 37.2% 36.5% 44.6%
                                 
                                 
  Five Quarter Comparison

Non-covered FDIC-acquired assets

   12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 

Outstanding principal balance:

FDIC-acquired non-covered loan pools $ 61,893 $ 66,294 $ 70,144 $ 76,675 $ 14,196
FDIC-acquired non-covered loans individually assessed 22,214   27,627   31,603   35,837   2,903
Total non-covered outstanding principal loan balance 84,107 93,921 101,747 112,512 17,099
Gross carrying value for FDIC-acquired non-covered OREO   4,470   4,993   2,529   2,371   793
Total gross balance of non-covered assets $ 88,577 $ 98,914 $ 104,276 $ 114,883 $ 17,892

Non-covered non-accretable discount for estimated credit losses:

FDIC-acquired non-covered loan pools $ 8,932 9,297 9,341 9,479 1,775
FDIC-acquired non-covered loans individually assessed   5,397   12,294   14,894   16,482   2,130
Total non-covered non-accretable discount 14,329 21,591 24,235 25,961 3,905
FDIC-acquired non-covered OREO discount   2,776   3,313   1,442   1,008   191
Total non-covered discount for estimated credit losses 17,105   24,904   25,677   26,969   4,096

Non-covered accretable discount:

Non-covered accretable discount for improvement in cash flows 5,458 380 318 475 381
Other non-covered accretable discount   1,002   2,288   2,558   2,759   963
Total non-covered accretable discount   6,460   2,668   2,876   3,234   1,344
Total non-covered discount $ 23,565 $ 27,572 $ 28,553 $ 30,203 $ 5,440
 

Non-covered loan discount accretion recognized in income:

Individual assessed discount accretion $ 2,375 $ 619 $ 974 $ 42 $ 29
Pooled assessed discount accretion   249   184   174   24   39
Total non-covered discount accretion recognized in income $ 2,624 $ 803 $ 1,148 $ 66 $ 68
 

Non-covered FDIC-acquired ratios:

Total discount to principal balance for non-covered FDIC-acquired assets 26.6% 27.9% 27.4% 26.3% 30.4%
Gross balance of non-covered loans to total FDIC-acquired loans 47.3% 48.0% 48.5% 47.9% 11.2%
                                 
                                 
Five Quarter Comparison

Covered FDIC-acquired assets

12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 

Outstanding principal balance:

FDIC-acquired covered loan pools $ 69,192 $ 74,020 $ 79,552 $ 90,020 $ 98,570
FDIC-acquired covered loans individually assessed 24,517   27,554   28,690   32,294   36,440
Total covered outstanding principal loan balance 93,709 101,574 108,242 122,314 135,010
Gross carrying value for FDIC-acquired OREO covered   15,463   14,634   17,385   20,628   20,966
Total gross balance of covered assets $ 109,172 $ 116,208 $ 125,627 $ 142,942 $ 155,976

Covered non-accretable discount for estimated credit losses:

FDIC-acquired covered loan pools $ 15,284 $ 16,281 $ 19,917 $ 20,705 $ 27,194
FDIC-acquired covered loans individually assessed 7,133   10,673   11,018   12,892   14,900
Total covered non-accretable discount 22,417 26,954 30,935 33,597 42,094
FDIC-acquired covered OREO discount   8,410   8,725   9,570   11,168   11,499
Total covered discount for estimated credit losses 30,827   35,679   40,505   44,765   53,593

Covered accretable discount:

Covered accretable discount for improvement in cash flows 18,012 17,676 16,297 18,820 15,396
Other covered accretable discount   2,389   3,101   3,834   4,082   5,095
Total covered accretable discount   20,401   20,777   20,131   22,902   20,491
Total covered discount $ 51,228 $ 56,456 $ 60,636 $ 67,667 $ 74,084
 

Covered loan discount accretion recognized in income:

Individual assessed accretion $ 757 $ 172 $ 1,362 $ 595 $ 2,486
Pooled assessed accretion   2,891   2,743   3,634   3,927   4,092
Total covered discount accretion recognized in income $ 3,648 $ 2,915 $ 4,996 $ 4,522 $ 6,578
 

Covered FDIC-acquired ratios:

Total discount to principal balance for covered FDIC-acquired assets 46.9% 48.6% 48.3% 47.3% 47.5%
 
                                 
                                 
Five Quarter Comparison

FDIC loss-share receivable

12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 

FDIC loss-share receivable:

Single family estimated credit losses $ 8,995 $ 9,134 $ 9,764 $ 10,720 $ 11,292
Non-single family estimated credit losses 30,077 33,550 35,678 40,148 43,899
Pending reimbursements and other   2,234   1,843   2,664   1,144   5,540
Total $ 41,306 $ 44,527 $ 48,106 $ 52,012 $ 60,731
 
FDIC loss-share clawback liability $ 1,941 $ 1,681 $ 1,393 $ 1,269 $ 703
 
Total covered discount $ 51,228 $ 56,456 $ 60,636 $ 67,667 $ 74,084
Total covered discount impacting FDIC loss-share receivable $ 48,839 $ 53,355 $ 56,802 $ 63,585 $ 68,989
Total covered discount impacting FDIC loss-share receivable at 80% $ 39,071 $ 42,684 $ 45,442 $ 50,868 $ 55,191
 

FDIC loss-share receivable ratios:

FDIC receivable as % of gross balance of covered assets 37.8% 38.3% 38.3% 36.4% 38.9%
Covered discount at 80% as of % of FDIC receivable 94.6% 95.9% 94.5% 97.8% 90.9%
 
Heritage Financial Group, Inc. and Subsidiary
Consolidated Financial Highlights
(Unaudited)
           
                                 

Mortgage Segment Information

Five Quarter Comparison
  12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 
Net interest income $ 114 $ 218 $ 112 $ 19 $ 156
Provision for loan losses - - - - -
Noninterest income 2,951 1,952 3,424 2,182 1,452
Noninterest expense 3,149 2,968 3,239 2,206 1,732
Income tax expense (benefit)   (26 )   (247 )   92     (2 )   (38 )
Mortgage profit (loss) $ (58 ) $ (551 ) $ 205   $ (3 ) $ (86 )
 
Mortgage segment assets $ 120,716   $ 44,588   $ 46,854   $ 20,849   $ 16,382  
                                 
 
                                 

Mortgage Segment Selected Other Information:

  Five Quarter Comparison
  12/31/2013     9/30/2013     6/30/2013     3/31/2013     12/31/2012
 
Retail production $ 84,381 $ 83,657 $ 97,608 $ 49,450 $ 55,815
Wholesale production $ 36,030 $ 31,646 $ 19,072 $ 5,588 $ -
Purchase as a % of total production 78 % 76 % 66 % 54 % 42 %
Refi as a % of total production 22 % 24 % 34 % 46 % 58 %
End of period Locks $ 43,054 $ 47,871 $ 53,910 $ 49,964 $ 20,271

Heritage Financial Group, Inc.
T. Heath Fountain, 229-878-2055
Executive Vice President and
Chief Financial Officer