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Equity Bancshares, Inc. Reports Second Quarter Results, Continued Organic Growth

·24 min read
Equity Bancshares, Inc.
Equity Bancshares, Inc.

Company saw NIM expansion, organic growth in the loan portfolio and noninterest income, with well managed operating expenses

WICHITA, Kansas, July 19, 2022 (GLOBE NEWSWIRE) -- Equity Bancshares, Inc. (NASDAQ: EQBK), (“Equity”, “the Company”, “we,” “us,” “our”), the Wichita-based holding company of Equity Bank, reported net income of $15.3 million and $0.94 earnings per diluted share for the quarter ended June 30, 2022.

“In 2022, we’ve demonstrated our ability to deliver organic growth absent a merger partner. Our 8.5% organic loan growth represents the hard work of our sales and operations teams to provide value to customers,” said Brad S. Elliott, Chairman and CEO, Equity Bancshares, Inc. “We have a great leadership team dedicated to driving loans, treasury services, deposit products, and new products such as our recently introduced healthcare services offerings. These efforts to deliver sophisticated products and customer experience solutions had the effect of increasing earnings, improving net interest margin, increasing fee income and improving our loan to deposit ratio.”

“In the third quarter, we expect to continue to strengthen our loan to deposit ratio and to serve as a resource for our customers as they continue to navigate economic challenges for their businesses and families,” said Mr. Elliott. “Our brand reflects our entrepreneurial spirit, and as we add talent to our leadership teams, new products and services, and new service channels, we’ll continue to operate with our local customers in mind.”

Notable Items:

  • During the second quarter, the Company realized continued loan growth excluding the impact of PPP assets and the branch sale, bring annualized loan growth year-to-date to 8.51%.

  • During the quarter, the Company realized linked period growth of 5.38% in service fee income, driven by additional debit card revenue and service charges on Equity Bank deposit products.

  • The Company closed on the sale of three branches to United Bank & Trust in Belleville, Clyde and Concordia, Kansas, which resulted in a net gain of $540 thousand.

  • At June 30, 2022, classified assets to regulatory capital has declined to 13.1% from 17.1% at March 31, 2022.

  • The Company continued to emphasize investor returns through repurchase of 355,844 shares during the quarter, at an average price of $31.54, as well as the continuation of our quarterly dividend program at $0.08 per share.  Under the currently active repurchase program, the Company is authorized to purchase an additional 126,900 shares.

Financial Results for the Quarter Ended June 30, 2022

Net income allocable to common stockholders was $15.3 million, or $0.94 per diluted share, for the three months ended June 30, 2022, as compared to $15.7 million, or $0.93 per diluted share, for the three months ended March 31, 2022. The decrease for the second quarter of 2022 is primarily due to increases in non-interest expense of $2.0 million and provision for credit losses of $1.2 million, partially offset by an increase in non-interest income of $615 thousand and net interest income of $277 thousand.

Net Interest Income

Net interest income was $39.6 million for the three months ended June 30, 2022, as compared to $39.3 million for the three months ended March 31, 2022, an increase of $277 thousand, or 0.7%.   The yield on interest-earning assets increased 7-basis points to 3.74% during the quarter ended June 30, 2022, as compared to 3.67% for the quarter ended March 31, 2022. The cost of interest-bearing deposits increased by 6 basis points during the quarter, moving from 0.22% at March 31, 2022 to 0.28% at June 30, 2022.

Provision for Credit Losses

During the three months ended June 30, 2022, there was a provision to the allowance for credit losses of $824 thousand compared to a net release of $412 thousand in the previous quarter. The comparative increase was primarily driven by the increase in general reserves driven by slowing prepayment speeds and the perceived risk associated with the current economic environment, which includes, significant inflation, supply chain concerns and the impact of monetary policy on consumers and businesses.   For the three months ended June 30, 2022, we had net charge-offs of $176 thousand as compared to $362 thousand for the three months ended March 31, 2022.

Non-Interest Income

Total non-interest income was $9.6 million for the three months ended June 30, 2022, as compared to $9.0 million for the three months ended March 31, 2022, or an increase of 6.8%, quarter over quarter. The increase was primarily due to an increase in net gain on acquisition and branch sales of $540 thousand.

Non-Interest Expense

Total non-interest expense for the quarter ended June 30, 2022, was $31.4 million as compared to $29.5 million for the quarter ended March 31, 2022. The $2.0 million change was primarily due to increases in other non-interest expense of $2.0 million driven by a provision to reserve for unfunded commitments of $288 thousand for the quarter ended June 30, 2022, compared to a release of reserve for unfunded commitments of $1.0 million for the quarter ended March 31, 2022.

Asset Quality

As of June 30, 2022, Equity’s allowance for credit losses to total loans remained constant at 1.5%, as compared to March 31, 2022. Nonperforming assets were $37.0 million as of June 30, 2022, or 0.7% of total assets, compared to $37.5 million at March 31, 2022, or 0.7% of total assets. Non-accrual loans were $18.9 million at June 30, 2022, as compared to $20.7 million at March 31, 2022. Total classified assets, including loans rated special mention or worse, other real estate owned and other repossessed assets were $72.1 million, or 13.1% of regulatory capital, down from $94.2 million, or 17.1% of regulatory capital as of March 31, 2022.

During the quarter ended June 30, 2022, non-performing assets decreased $500 thousand due to decreases in non-accrual loans of $1.8 million partially offset by increases in closed bank branches classified as other real estate owned of $881 thousand and other repossessed assets of $83 thousand.

Regulatory Capital

The Company’s ratio of common equity tier 1 capital to risk-weighted assets was 12.1%, the total capital to risk-weighted assets was 16.0% and the total leverage ratio was 9.1% at June 30, 2022.   At March 31, 2022, the Company’s common equity tier 1 capital to risk-weighted assets ratio was 11.8%, the total capital to risk-weighted assets ratio was 15.7% and the total leverage ratio was 9.1%.

The Company’s subsidiary, Equity Bank, had a ratio of common equity tier 1 capital to risk-weighted assets of 13.9%, a ratio of total capital to risk-weighted assets of 15.1% and a total leverage ratio of 9.9% at June 30, 2022.   At March 31, 2022, Equity Bank’s ratio of common equity tier 1 capital to risk-weighted assets was 13.7%, the ratio of total capital to risk-weighted assets was 14.9% and the total leverage ratio was 10.0%.

Non-GAAP Financial Measures

In addition to evaluating the Company’s results of operations in accordance with accounting principles generally accepted in the United States of America (“GAAP”), management periodically supplements this evaluation with an analysis of certain non-GAAP financial measures that are intended to provide the reader with additional perspectives on operating results, financial condition and performance trends, while facilitating comparisons with the performance of other financial institutions. Non-GAAP financial measures are not a substitute for GAAP measures, rather, they should be read and used in conjunction with the Company’s GAAP financial information.

The efficiency ratio is a common comparable metric used by banks to understand the expense structure relative to total revenue. In other words, for every dollar of total revenue recognized, how much of that dollar is expended. To improve the comparability of the ratio to our peers, non-core items are excluded. To improve transparency and acknowledging that banks are not consistent in their definition of the efficiency ratio, we include our calculation of this non-GAAP measure.

Return on average assets before income tax provision and provision for loan losses is a measure that the Company uses to understand fundamental operating performance before these expenses. Used as a ratio relative to average assets, we believe it demonstrates “core” performance and can be viewed as an alternative measure of how efficiently the Company services its asset base. Used as a ratio relative to average equity, it can function as an alternative measure of the Company’s earnings performance in relationship to its equity.

Tangible common equity and related measures are non-GAAP financial measures that exclude the impact of intangible assets, net of deferred taxes, and their related amortization. These financial measures are useful for evaluating the performance of a business consistently, whether acquired or developed internally. Return on average tangible common equity is used by management and readers of our financial statements to understand how efficiently the Company is deploying its common equity. Companies that are able to demonstrate more efficient use of common equity are more likely to be viewed favorably by current and prospective investors.

The Company believes that disclosing these non-GAAP financial measures is both useful internally and is expected by our investors and analysts in order to understand the overall performance of the Company. Other companies may calculate and define their non-GAAP financial measures and supplemental data differently. A reconciliation of GAAP financial measures to non-GAAP measures and other performance ratios, as adjusted, are included in Table 6 in the following press release tables.

Conference Call and Webcast

Equity’s Chairman and Chief Executive Officer, Brad Elliott, and Chief Financial Officer, Eric Newell, will hold a conference call and webcast to discuss second quarter results on Wednesday, July 20, 2022 at 10 a.m. eastern time or 9 a.m. central time.

A live webcast of the call will be available on the Company’s website at investor.equitybank.com. To access the call by phone, please go to this registration link, and you will be provided with dial in details. Investors, news media, and other participants are encouraged to dial into the conference call ten minutes ahead of the scheduled start time.

A replay of the call and webcast will be available two hours following the close of the call until July 27, 2022, accessible at investor.equitybank.com.

About Equity Bancshares, Inc.

Equity Bancshares, Inc. is the holding company for Equity Bank, offering a full range of financial solutions, including commercial loans, consumer banking, mortgage loans, trust and wealth management services and treasury management services, while delivering the high-quality, relationship-based customer service of a community bank. Equity’s common stock is traded on the NASDAQ Global Select Market under the symbol “EQBK.” Learn more at www.equitybank.com.

Special Note Concerning Forward-Looking Statements

This press release contains “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 forward-looking statements reflect the current views of Equity’s management with respect to, among other things, future events and Equity’s financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about Equity’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond Equity’s control. Accordingly, Equity cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although Equity believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from Equity’s expectations include COVID-19 related impacts; competition from other financial institutions and bank holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses; and similar variables. The foregoing list of factors is not exhaustive.

For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in Equity’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 9, 2022, and any updates to those risk factors set forth in Equity’s subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if Equity’s underlying assumptions prove to be incorrect, actual results may differ materially from what Equity anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and Equity does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, such as COVID-19, and it is not possible for us to predict those events or how they may affect us. In addition, Equity cannot assess the impact of each factor on Equity’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Equity or persons acting on Equity’s behalf may issue.

Investor Contact:

Chris Navratil
SVP, Finance
Equity Bancshares, Inc.
(316) 612-6014
cnavratil@equitybank.com

Media Contact:

John J. Hanley
SVP, Senior Director of Marketing
Equity Bancshares, Inc.
(913) 583-8004
jhanley@equitybank.com

Unaudited Financial Tables

  • Table 1. Consolidated Statements of Income

  • Table 2. Quarterly Consolidated Statements of Income

  • Table 3. Consolidated Balance Sheets

  • Table 4. Selected Financial Highlights

  • Table 5. Year-To-Date Net Interest Income Analysis

  • Table 6. Quarter-To-Date Net Interest Income Analysis

  • Table 7. Quarter-Over-Quarter Net Interest Income Analysis

  • Table 8. Non-GAAP Financial Measures

TABLE 1. CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(Dollars in thousands, except per share data)

 

Three months ended
June 30,

 

 

Six months ended
June 30,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Interest and dividend income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, including fees

$

36,849

 

 

$

33,810

 

 

$

73,155

 

 

$

64,811

 

Securities, taxable

 

5,584

 

 

 

3,523

 

 

 

10,975

 

 

 

7,322

 

Securities, nontaxable

 

678

 

 

 

717

 

 

 

1,333

 

 

 

1,441

 

Federal funds sold and other

 

513

 

 

 

268

 

 

 

813

 

 

 

556

 

Total interest and dividend income

 

43,624

 

 

 

38,318

 

 

 

86,276

 

 

 

74,130

 

Interest expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

2,183

 

 

 

2,025

 

 

 

3,905

 

 

 

4,435

 

Federal funds purchased and retail repurchase agreements

 

46

 

 

 

26

 

 

 

79

 

 

 

48

 

Federal Home Loan Bank advances

 

176

 

 

 

80

 

 

 

185

 

 

 

145

 

Subordinated debt

 

1,653

 

 

 

1,557

 

 

 

3,252

 

 

 

3,113

 

Total interest expense

 

4,058

 

 

 

3,688

 

 

 

7,421

 

 

 

7,741

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

39,566

 

 

 

34,630

 

 

 

78,855

 

 

 

66,389

 

Provision (reversal) for credit losses

 

824

 

 

 

(1,657

)

 

 

412

 

 

 

(7,413

)

Net interest income after provision (reversal) for credit losses

 

38,742

 

 

 

36,287

 

 

 

78,443

 

 

 

73,802

 

Non-interest income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges and fees

 

2,617

 

 

 

2,169

 

 

 

5,139

 

 

 

3,765

 

Debit card income

 

2,810

 

 

 

2,679

 

 

 

5,438

 

 

 

5,029

 

Mortgage banking

 

428

 

 

 

848

 

 

 

990

 

 

 

1,783

 

Increase in value of bank-owned life insurance

 

736

 

 

 

676

 

 

 

1,601

 

 

 

1,277

 

Net gain on acquisition and branch sales

 

540

 

 

 

663

 

 

 

540

 

 

 

585

 

Net gains (losses) from securities transactions

 

(32

)

 

 

 

 

 

8

 

 

 

17

 

Other

 

2,538

 

 

 

2,065

 

 

 

4,943

 

 

 

3,356

 

Total non-interest income

 

9,637

 

 

 

9,100

 

 

 

18,659

 

 

 

15,812

 

Non-interest expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

15,383

 

 

 

12,769

 

 

 

30,451

 

 

 

25,491

 

Net occupancy and equipment

 

3,007

 

 

 

2,327

 

 

 

6,177

 

 

 

4,695

 

Data processing

 

3,642

 

 

 

3,474

 

 

 

7,411

 

 

 

6,137

 

Professional fees

 

1,111

 

 

 

999

 

 

 

2,282

 

 

 

2,072

 

Advertising and business development

 

972

 

 

 

799

 

 

 

1,948

 

 

 

1,481

 

Telecommunications

 

442

 

 

 

512

 

 

 

912

 

 

 

1,092

 

FDIC insurance

 

260

 

 

 

425

 

 

 

440

 

 

 

840

 

Courier and postage

 

489

 

 

 

327

 

 

 

912

 

 

 

696

 

Free nationwide ATM cost

 

541

 

 

 

513

 

 

 

1,042

 

 

 

985

 

Amortization of core deposit intangibles

 

1,111

 

 

 

1,030

 

 

 

2,161

 

 

 

2,064

 

Loan expense

 

207

 

 

 

181

 

 

 

392

 

 

 

419

 

Other real estate owned

 

14

 

 

 

(468

)

 

 

13

 

 

 

(463

)

Merger expenses

 

88

 

 

 

460

 

 

 

411

 

 

 

612

 

Other

 

4,169

 

 

 

2,458

 

 

 

6,343

 

 

 

4,566

 

Total non-interest expense

 

31,436

 

 

 

25,806

 

 

 

60,895

 

 

 

50,687

 

Income (loss) before income tax

 

16,943

 

 

 

19,581

 

 

 

36,207

 

 

 

38,927

 

Provision for income taxes

 

1,684

 

 

 

4,415

 

 

 

5,298

 

 

 

8,686

 

Net income (loss) and net income (loss) allocable to common stockholders

$

15,259

 

 

$

15,166

 

 

$

30,909

 

 

$

30,241

 

Basic earnings (loss) per share

$

0.95

 

 

$

1.06

 

 

$

1.88

 

 

$

2.10

 

Diluted earnings (loss) per share

$

0.94

 

 

$

1.03

 

 

$

1.86

 

 

$

2.06

 

Weighted average common shares

 

16,106,683

 

 

 

14,356,958

 

 

 

16,428,535

 

 

 

14,410,328

 

Weighted average diluted common shares

 

16,312,953

 

 

 

14,674,838

 

 

 

16,639,970

 

 

 

14,704,240

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TABLE 2. QUARTERLY CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(Dollars in thousands, except per share data)

 

As of and for the three months ended

 

 

June 30,
2022

 

 

March 31,
2022

 

 

December 31,
2021

 

 

September 30,
2021

 

 

June 30,
2021

 

Interest and dividend income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, including fees

$

36,849

 

 

$

36,306

 

 

$

34,942

 

 

$

37,581

 

 

$

33,810

 

Securities, taxable

 

5,584

 

 

 

5,391

 

 

 

4,754

 

 

 

3,920

 

 

 

3,523

 

Securities, nontaxable

 

678

 

 

 

655

 

 

 

747

 

 

 

655

 

 

 

717

 

Federal funds sold and other

 

513

 

 

 

300

 

 

 

349

 

 

 

290

 

 

 

268

 

Total interest and dividend income

 

43,624

 

 

 

42,652

 

 

 

40,792

 

 

 

42,446

 

 

 

38,318

 

Interest expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

2,183

 

 

 

1,722

 

 

 

1,939

 

 

 

1,881

 

 

 

2,025

 

Federal funds purchased and retail repurchase agreements

 

46

 

 

 

33

 

 

 

32

 

 

 

24

 

 

 

26

 

Federal Home Loan Bank advances

 

176

 

 

 

9

 

 

 

14

 

 

 

10

 

 

 

80

 

Subordinated debt

 

1,653

 

 

 

1,599

 

 

 

1,592

 

 

 

1,556

 

 

 

1,557

 

Total interest expense

 

4,058

 

 

 

3,363

 

 

 

3,577

 

 

 

3,471

 

 

 

3,688

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

39,566

 

 

 

39,289

 

 

 

37,215

 

 

 

38,975

 

 

 

34,630

 

Provision (reversal) for credit losses

 

824

 

 

 

(412

)

 

 

(2,125

)

 

 

1,058

 

 

 

(1,657

)

Net interest income after provision (reversal) for credit losses

 

38,742

 

 

 

39,701

 

 

 

39,340

 

 

 

37,917

 

 

 

36,287

 

Non-interest income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges and fees

 

2,617

 

 

 

2,522

 

 

 

2,471

 

 

 

2,360

 

 

 

2,169

 

Debit card income

 

2,810

 

 

 

2,628

 

 

 

2,633

 

 

 

2,574

 

 

 

2,679

 

Mortgage banking

 

428

 

 

 

562

 

 

 

722

 

 

 

801

 

 

 

848

 

Increase in value of bank-owned life insurance

 

736

 

 

 

865

 

 

 

1,060

 

 

 

1,169

 

 

 

676

 

Net gain on acquisition and branch sales

 

540

 

 

 

 

 

 

 

 

 

 

 

 

663

 

Net gains (losses) from securities transactions

 

(32

)

 

 

40

 

 

 

8

 

 

 

381

 

 

 

 

Other

 

2,538

 

 

 

2,405

 

 

 

2,305

 

 

 

546

 

 

 

2,065

 

Total non-interest income

 

9,637

 

 

 

9,022

 

 

 

9,199

 

 

 

7,831

 

 

 

9,100

 

Non-interest expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

15,383

 

 

 

15,068

 

 

 

15,119

 

 

 

13,588

 

 

 

12,769

 

Net occupancy and equipment

 

3,007

 

 

 

3,170

 

 

 

2,967

 

 

 

2,475

 

 

 

2,327

 

Data processing

 

3,642

 

 

 

3,769

 

 

 

3,867

 

 

 

3,257

 

 

 

3,474

 

Professional fees

 

1,111

 

 

 

1,171

 

 

 

1,565

 

 

 

1,076

 

 

 

999

 

Advertising and business development

 

972

 

 

 

976

 

 

 

1,129

 

 

 

760

 

 

 

799

 

Telecommunications

 

442

 

 

 

470

 

 

 

435

 

 

 

439

 

 

 

512

 

FDIC insurance

 

260

 

 

 

180

 

 

 

360

 

 

 

465

 

 

 

425

 

Courier and postage

 

489

 

 

 

423

 

 

 

389

 

 

 

344

 

 

 

327

 

Free nationwide ATM cost

 

541

 

 

 

501

 

 

 

515

 

 

 

519

 

 

 

513

 

Amortization of core deposit intangibles

 

1,111

 

 

 

1,050

 

 

 

1,080

 

 

 

1,030

 

 

 

1,030

 

Loan expense

 

207

 

 

 

185

 

 

 

308

 

 

 

207

 

 

 

181

 

Other real estate owned

 

14

 

 

 

(1

)

 

 

617

 

 

 

(342

)

 

 

(468

)

Loss on debt extinguishment

 

 

 

 

 

 

 

 

 

 

372

 

 

 

 

Merger expenses

 

88

 

 

 

323

 

 

 

4,562

 

 

 

4,015

 

 

 

460

 

Other

 

4,169

 

 

 

2,174

 

 

 

5,176

 

 

 

2,484

 

 

 

2,458

 

Total non-interest expense

 

31,436

 

 

 

29,459

 

 

 

38,089

 

 

 

30,689

 

 

 

25,806

 

Income (loss) before income tax

 

16,943

 

 

 

19,264

 

 

 

10,450

 

 

 

15,059

 

 

 

19,581

 

Provision for income taxes (benefit)

 

1,684

 

 

 

3,614

 

 

 

(16

)

 

 

3,286

 

 

 

4,415

 

Net income (loss) and net income (loss) allocable to common stockholders

$

15,259

 

 

$

15,650

 

 

$

10,466

 

 

$

11,773

 

 

$

15,166

 

Basic earnings (loss) per share

$

0.95

 

 

$

0.94

 

 

$

0.62

 

 

$

0.82

 

 

$

1.06

 

Diluted earnings (loss) per share

$

0.94

 

 

$

0.93

 

 

$

0.61

 

 

$

0.80

 

 

$

1.03

 

Weighted average common shares

 

16,106,683

 

 

 

16,652,556

 

 

 

16,865,167

 

 

 

14,384,302

 

 

 

14,356,958

 

Weighted average diluted common shares

 

16,312,953

 

 

 

16,869,152

 

 

 

17,141,174

 

 

 

14,669,312

 

 

 

14,674,838

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TABLE 3. CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars in thousands)

 

June 30,
2022

 

 

March 31,
2022

 

 

December 31,
2021

 

 

September 30,
2021

 

 

June 30,
2021

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

$

103,126

 

 

$

89,764

 

 

$

259,131

 

 

$

141,645

 

 

$

138,869

 

Federal funds sold

 

458

 

 

 

286

 

 

 

823

 

 

 

673

 

 

 

452

 

Cash and cash equivalents

 

103,584

 

 

 

90,050

 

 

 

259,954

 

 

 

142,318

 

 

 

139,321

 

Available-for-sale securities

 

1,288,180

 

 

 

1,352,894

 

 

 

1,327,442

 

 

 

1,157,423

 

 

 

1,041,613

 

Loans held for sale

 

1,714

 

 

 

1,575

 

 

 

4,214

 

 

 

4,108

 

 

 

6,183

 

Loans, net of allowance for credit losses(1)

 

3,175,208

 

 

 

3,194,987

 

 

 

3,107,262

 

 

 

2,633,148

 

 

 

2,763,227

 

Other real estate owned, net

 

12,969

 

 

 

9,897

 

 

 

9,523

 

 

 

10,267

 

 

 

10,861

 

Premises and equipment, net

 

101,212

 

 

 

103,168

 

 

 

104,038

 

 

 

90,727

 

 

 

90,876

 

Bank-owned life insurance

 

121,665

 

 

 

120,928

 

 

 

120,787

 

 

 

103,431

 

 

 

103,321

 

Federal Reserve Bank and Federal Home Loan Bank stock

 

21,479

 

 

 

19,890

 

 

 

17,510

 

 

 

14,540

 

 

 

18,454

 

Interest receivable

 

16,519

 

 

 

16,923

 

 

 

18,048

 

 

 

15,519

 

 

 

15,064

 

Goodwill

 

53,101

 

 

 

54,465

 

 

 

54,465

 

 

 

31,601

 

 

 

31,601

 

Core deposit intangibles, net

 

12,554

 

 

 

13,830

 

 

 

14,879

 

 

 

12,963

 

 

 

13,993

 

Other

 

93,971

 

 

 

100,016

 

 

 

99,509

 

 

 

47,223

 

 

 

33,702

 

Total assets

$

5,002,156

 

 

$

5,078,623

 

 

$

5,137,631

 

 

$

4,263,268

 

 

$

4,268,216

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand

$

1,194,863

 

 

$

1,255,793

 

 

$

1,244,117

 

 

$

984,436

 

 

$

992,565

 

Total non-interest-bearing deposits

 

1,194,863

 

 

 

1,255,793

 

 

 

1,244,117

 

 

 

984,436

 

 

 

992,565

 

Demand, savings and money market

 

2,445,545

 

 

 

2,511,478

 

 

 

2,522,289

 

 

 

2,092,849

 

 

 

2,035,496

 

Time

 

651,363

 

 

 

612,399

 

 

 

653,598

 

 

 

585,492

 

 

 

659,494

 

Total interest-bearing deposits

 

3,096,908

 

 

 

3,123,877

 

 

 

3,175,887

 

 

 

2,678,341

 

 

 

2,694,990

 

Total deposits

 

4,291,771

 

 

 

4,379,670

 

 

 

4,420,004

 

 

 

3,662,777

 

 

 

3,687,555

 

Federal funds purchased and retail repurchase agreements

 

52,750

 

 

 

48,199

 

 

 

56,006

 

 

 

39,137

 

 

 

47,184

 

Federal Home Loan Bank advances

 

80,000

 

 

 

50,000

 

 

 

 

 

 

 

 

 

9,208

 

Subordinated debt

 

96,135

 

 

 

96,010

 

 

 

95,885

 

 

 

88,030

 

 

 

87,908

 

Contractual obligations

 

15,813

 

 

 

17,307

 

 

 

17,692

 

 

 

18,771

 

 

 

4,469

 

Interest payable and other liabilities

 

37,572

 

 

 

35,422

 

 

 

47,413

 

 

 

36,804

 

 

 

18,897

 

Total liabilities

 

4,574,041

 

 

 

4,626,608

 

 

 

4,637,000

 

 

 

3,845,519

 

 

 

3,855,221

 

Commitments and contingent liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

204

 

 

 

204

 

 

 

203

 

 

 

178

 

 

 

176

 

Additional paid-in capital

 

480,897

 

 

 

480,106

 

 

 

478,862

 

 

 

392,321

 

 

 

389,394

 

Retained earnings

 

116,576

 

 

 

102,632

 

 

 

88,324

 

 

 

79,226

 

 

 

68,625

 

Accumulated other comprehensive income, net of tax

 

(77,426

)

 

 

(50,012

)

 

 

1,776

 

 

 

9,475

 

 

 

13,450

 

Treasury stock

 

(92,136

)

 

 

(80,915

)

 

 

(68,534

)

 

 

(63,451

)

 

 

(58,650

)

Total stockholders’ equity

 

428,115

 

 

 

452,015

 

 

 

500,631

 

 

 

417,749

 

 

 

412,995

 

Total liabilities and stockholders’ equity

$

5,002,156

 

 

$

5,078,623

 

 

$

5,137,631

 

 

$

4,263,268

 

 

$

4,268,216

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Allowance for credit losses

$

48,238

 

 

$

47,590

 

 

$

48,365

 

 

$

52,763

 

 

$

51,834

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TABLE 4. SELECTED FINANCIAL HIGHLIGHTS (Unaudited)
(Dollars in thousands, except per share data)

 

As of and for the three months ended

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

June 30,

 

 

2022

 

 

2022

 

 

2021

 

 

2021

 

 

2021

 

Loans Held For Investment by Type

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate

$

1,643,068

 

 

$

1,552,134

 

 

$

1,486,148

 

 

$

1,308,707

 

 

$

1,261,214

 

Commercial and industrial

 

578,899

 

 

 

629,181

 

 

 

567,497

 

 

 

569,513

 

 

 

732,126

 

Residential real estate

 

578,936

 

 

 

613,928

 

 

 

638,087

 

 

 

490,633

 

 

 

503,110

 

Agricultural real estate

 

197,938

 

 

 

198,844

 

 

 

198,330

 

 

 

138,793

 

 

 

129,020

 

Agricultural

 

124,753

 

 

 

150,077

 

 

 

166,975

 

 

 

93,767

 

 

 

97,912

 

Consumer

 

99,852

 

 

 

98,413

 

 

 

98,590

 

 

 

84,498

 

 

 

91,679

 

Total loans held-for-investment

 

3,223,446

 

 

 

3,242,577

 

 

 

3,155,627

 

 

 

2,685,911

 

 

 

2,815,061

 

Allowance for credit losses

 

(48,238

)

 

 

(47,590

)

 

 

(48,365

)

 

 

(52,763

)

 

 

(51,834

)

Net loans held for investment

$

3,175,208

 

 

$

3,194,987

 

 

$

3,107,262

 

 

$

2,633,148

 

 

$

2,763,227

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Quality Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for credit losses on loans to total loans

 

1.50

%

 

 

1.47

%

 

 

1.53

%

 

 

1.96

%

 

 

1.84

%

Past due or nonaccrual loans to total loans

 

0.78

%

 

 

0.82

%

 

 

1.18

%

 

 

2.78

%

 

 

2.09

%

Nonperforming assets to total assets

 

0.74

%

 

 

0.74

%

 

 

1.28

%

 

 

1.74

%

 

 

1.56

%

Nonperforming assets to total loans plus other
real estate owned

 

1.14

%

 

 

1.15

%

 

 

2.07

%

 

 

2.76

%

 

 

2.36

%

Classified assets to bank total regulatory capital

 

13.08

%

 

 

17.12

%

 

 

25.34

%

 

 

24.25

%

 

 

23.20

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected Average Balance Sheet Data (QTD Average)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities

$

1,319,099

 

 

$

1,397,421

 

 

$

1,330,267

 

 

$

1,061,178

 

 

$

986,986

 

Total gross loans receivable

 

3,216,853

 

 

 

3,195,787

 

 

 

3,181,279

 

 

 

2,748,202

 

 

 

2,853,145

 

Interest-earning assets

 

4,675,967

 

 

 

4,715,389

 

 

 

4,713,817

 

 

 

4,005,509

 

 

 

3,964,633

 

Total assets

 

5,067,686

 

 

 

5,108,120

 

 

 

5,068,278

 

 

 

4,275,298

 

 

 

4,231,439

 

Interest-bearing deposits

 

3,112,300

 

 

 

3,163,777

 

 

 

3,101,657

 

 

 

2,702,040

 

 

 

2,656,052

 

Borrowings

 

238,062

 

 

 

160,094

 

 

 

165,941

 

 

 

132,581

 

 

 

171,658

 

Total interest-bearing liabilities

 

3,350,362

 

 

 

3,323,871

 

 

 

3,267,598

 

 

 

2,834,621

 

 

 

2,827,710

 

Total deposits

 

4,340,196

 

 

 

4,393,879

 

 

 

4,342,732

 

 

 

3,686,169

 

 

 

3,624,950

 

Total liabilities

 

4,630,204

 

 

 

4,615,521

 

 

 

4,505,232

 

 

 

3,852,419

 

 

 

3,827,400

 

Total stockholders' equity

 

437,483

 

 

 

492,599

 

 

 

563,046

 

 

 

422,879

 

 

 

404,039

 

Tangible common equity*

 

368,505

 

 

 

422,418

 

 

 

501,860

 

 

 

376,544

 

 

 

356,705

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performance ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (ROAA) annualized

 

1.21

%

 

 

1.24

%

 

 

0.82

%

 

 

1.09

%

 

 

1.44

%

Return on average assets before income tax and
provision for loan losses*

 

1.41

%

 

 

1.50

%

 

 

0.65

%

 

 

1.50

%

 

 

1.70

%

Return on average equity (ROAE) annualized

 

13.99

%

 

 

12.88

%

 

 

7.37

%

 

 

11.05

%

 

 

15.06

%

Return on average equity before income tax and
provision for loan losses*

 

16.29

%

 

 

15.52

%

 

 

5.87

%

 

 

15.12

%

 

 

17.79

%

Return on average tangible common equity
(ROATCE) annualized*

 

17.60

%

 

 

15.85

%

 

 

8.97

%

 

 

13.27

%

 

 

17.98

%

Yield on loans annualized

 

4.59

%

 

 

4.61

%

 

 

4.36

%

 

 

5.43

%

 

 

4.75

%

Cost of interest-bearing deposits annualized

 

0.28

%

 

 

0.22

%

 

 

0.25

%

 

 

0.28

%

 

 

0.31

%

Cost of total deposits annualized

 

0.20

%

 

 

0.16

%

 

 

0.18

%

 

 

0.20

%