ServisFirst Bancshares, Inc. Announces Results For First Quarter of 2021

ServisFirst Bancshares, Inc.
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BIRMINGHAM, Ala., April 19, 2021 (GLOBE NEWSWIRE) -- ServisFirst Bancshares, Inc. (NASDAQ: SFBS), today announced earnings and operating results for the quarter ended March 31, 2021.

First Quarter 2021 Highlights:

  • Diluted earnings per share were $0.95 for the first quarter, an increase of 48% over the first quarter of 2020

  • Deposits grew from $7.83 billion to $10.58 billion year-over-year, or 35%, and grew $602 million on a linked-quarter basis, or 24%, annualized

  • We funded approximately 2,170 round-two Payroll Protection Program (“PPP”) loans totaling approximately $386 million through March 31, 2021

  • Our loan pipeline reached a record level during the quarter

  • Liquidity reached record levels, with over $2.5 billion on deposit at the Federal Reserve Bank

  • We continue to experience excellent credit quality as we prepare to exit the pandemic

  • Our efficiency ratio improved to 28% during the quarter compared to 33% during the first quarter of 2020

  • Book value per share increased to $19.03, a 16% increase year-over-year

Tom Broughton, Chairman, President and CEO, said, “We are pleased to see the rebound in our pipeline to record levels. All signs point to an economic resurgence post-pandemic.”

Bud Foshee, CFO, said, “Growth has continued our normal trend lines while our expense control has been very good.”

FINANCIAL SUMMARY (UNAUDITED)

(in Thousands except share and per share amounts)

Period Ending March 31, 2021

Period Ending December 31, 2020

% Change From Period Ending December 31, 2020 to Period Ending March 31, 2021

Period Ending March 31, 2020

% Change From Period Ending March 31, 2020 to Period Ending March 31, 2021

QUARTERLY OPERATING RESULTS

Net Income

$

51,455

$

50,981

1

%

$

34,778

48

%

Net Income Available to Common Stockholders

$

51,455

$

50,949

1

%

$

34,778

48

%

Diluted Earnings Per Share

$

0.95

$

0.94

1

%

$

0.64

48

%

Return on Average Assets

1.72

%

1.74

%

1.54

%

Return on Average Common Stockholders' Equity

19.83

%

20.78

%

16.23

%

Average Diluted Shares Outstanding

54,381,991

54,273,944

54,167,414

BALANCE SHEET

Total Assets

$

12,647,374

$

11,932,654

6

%

$

9,364,882

35

%

Loans

8,504,980

8,465,688

-

%

7,568,836

12

%

Non-interest-bearing Demand Deposits

3,044,611

2,788,772

9

%

1,925,626

58

%

Total Deposits

10,577,610

9,975,724

6

%

7,832,655

35

%

Stockholders' Equity

1,030,485

992,852

4

%

881,885

17

%

DETAILED FINANCIALS

ServisFirst Bancshares, Inc. reported net income and net income available to common stockholders of $51.5 million for the quarter ended March 31, 2021, compared to net income and net income available to common stockholders of $34.8 million for the same quarter in 2020. Basic and diluted earnings per common share were $0.95 for the first quarter of 2021, compared to $0.65 and $0.64, respectively, for the first quarter of 2020.

Annualized return on average assets was 1.72% and annualized return on average common stockholders’ equity was 19.83% for the first quarter of 2021, compared to 1.54% and 16.23%, respectively, for the first quarter of 2020.

Net interest income was $92.4 million for the first quarter of 2021, compared to $92.1 million for the fourth quarter of 2020 and $77.6 million for the first quarter of 2020. The net interest margin in the first quarter of 2021 was 3.20% compared to 3.27% in the fourth quarter of 2020 and 3.58% in the first quarter of 2020. Accretion of net fees on PPP loans of $9.1 million during the first quarter of 2021 contributed 43 basis points of the loan yield, compared to $7.5 million of PPP loan fee accretion during the fourth quarter of 2020, or 35 basis points of the loan yield.

Average loans for the first quarter of 2021 were $8.51 billion, an increase of $47.9 million, or 2% annualized, with average loans of $8.46 billion for the fourth quarter of 2020, and an increase of $1.15 billion, or 16%, with average loans of $7.36 billion for the first quarter of 2020. Origination of round-two PPP loans during the first quarter of 2021 totaled $402 million while forgiveness of round-one PPP loans during the first quarter of 2021 totaled $334 million.

Average total deposits for the first quarter of 2021 were $10.18 billion, an increase of $337.0 million, or 14% annualized, with average total deposits of $9.84 billion for the fourth quarter of 2020, and an increase of $2.54 billion, or 33%, with average total deposits of $7.64 billion for the first quarter of 2020.

Non-performing assets to total assets were 0.16% for the first quarter of 2021, a decrease of five basis points compared to 0.21% for the fourth quarter of 2020 and a decrease of 28 basis points compared to 0.44% for the first quarter of 2020. Annualized net charge-offs to average loans were 0.02%, a 39 basis point decrease compared to 0.41% for the fourth quarter of 2020 and a decrease of 24 basis points compared to 0.26% for the first quarter of 2020. The allowance for credit losses for the quarters ending March 31, 2021 and December 31, 2020 were calculated under the CECL methodology and as a percentage of total loans were 1.12% and 1.04%, respectively. Other quarter-end periods presented for the allowance for loans losses were not restated for CECL adoption and were calculated under the incurred loss methodology. The allowance for loan losses as a percentage of total loans was 1.13% at March 31, 2020. Excluding PPP loans, for all periods discussed, the allowance for credit losses as a percentage of total loans under the CECL methodology at March 31, 2021 and December 31, 2020 was 1.26% and 1.16%, respectively, compared to 1.13% at March 31, 2020, under the incurred loss model. We recorded a $7.5 million provision for credit losses in the first quarter of 2021 compared to $6.3 million in the fourth quarter of 2020 and $13.6 million in the first quarter of 2020.

Non-interest income for the first quarter of 2021 increased $1.8 million, or 27%, to $8.5 million from $6.7 million in the first quarter of 2020. Mortgage banking revenue increased $1.7 million, or 157%, to $2.7 million from the first quarter of 2020 to the first quarter of 2021. Mortgage loan sales increased approximately 106% during the first quarter of 2021 when compared to the same quarter in 2020. Net credit card revenue decreased $573,000, or 33%, to $1.2 million during the first quarter of 2021, compared to $1.8 million during the first quarter of 2020, mainly due to a one-time catch up in under-accrued rebate expenses. The number of credit card accounts increased approximately 28% and the aggregate amount of spend on all credit card accounts increased 16% during the first quarter of 2021 compared to the first quarter of 2020. Cash surrender value of life insurance increased $205,000, or 14%, to $1.7 million during the first quarter of 2021, compared to $1.5 million during the first quarter of 2020. Other income for the first quarter of 2021 increased $489,000, or 104%, to $1.0 million from $469,000 in the first quarter of 2020. The interest rate cap bought in May of 2020 increased in value during the first quarter of 2021, contributing $275,000 to the increase in other income. Merchant service revenue increased from $100,000 during the first quarter of 2020 to $191,000 during the first quarter of 2021.

Non-interest expense for the first quarter of 2021 increased $1.0 million, or 4%, to $28.9 million from $27.9 million in the first quarter of 2020, and increased $712,000, or 3%, on a linked quarter basis. Salary and benefit expense for the first quarter of 2021 decreased $115,000, or 1%, to $15.6 million from $15.7 million in the first quarter of 2020, and increased $573,000, or 4%, on a linked quarter basis. Salary expense alone only increased by $11,000 during the first quarter of 2021 compared to the first quarter of 2020. Increased loan origination cost deferrals during the first quarter of 2021 over the amount in the first quarter of 2020 offset increased incentive accruals during the same comparative periods. Origination of round-two PPP loans during the first quarter of 2021 drove the increase in cost deferrals. The number of FTE employees decreased by one to 491 at March 31, 2021 compared to 492 at March 31, 2020, and decreased by two from the end of the fourth quarter of 2020. Equipment and occupancy expense increased $254,000, or 11%, to $2.7 million in the first quarter of 2021, from $2.4 million in the first quarter of 2020, and decreased $26,000 on a linked-quarter basis. Third party processing and other services expense decreased $41,000, or 1%, to $3.4 million in the first quarter of 2021, from $3.5 million in the first quarter of 2020 and was unchanged on a linked-quarter basis. Professional services expense decreased $25,000, or 3%, to $923,000 in the first quarter of 2021, from $948,000 in the first quarter of 2020, and decreased $325,000 on a linked-quarter basis. Fourth quarter 2020 professional services were inflated due to expenses associated with updating the Bank’s online application portal for the round-two PPP loans. FDIC and other regulatory assessments increased $250,000 to $1.6 million in the first quarter of 2021, from $1.3 million in the first quarter of 2020, and increased $216,000, or 16%, on a linked quarter basis. A larger assessment base driven by increased deposits caused the increase in FDIC assessments. Expenses associated with other real estate owned decreased $444,000 to $157,000 in the first quarter of 2021, from $601,000 in the first quarter of 2020, and increased $17,000, or 12%, on a linked quarter basis. First quarter 2020 included write-downs in value of property based on updated appraisals related to one foreclosed loan relationship. Other operating expenses for the first quarter of 2021 increased $1.1 million, or 32%, to $4.6 million from $3.5 million in the first quarter of 2020, and increased $259,000 on a linked-quarter basis. We increased our credit losses on unfunded loan commitments by $600,000 in the first quarter of 2021 with a charge to other operating expenses. The efficiency ratio was 28.68% during the first quarter of 2021 compared to 33.11% during the first quarter of 2020 and compared to 28.11% during the fourth quarter of 2020.

Income tax expense increased $5.0 million, or 48%, to $13.0 million in the first quarter of 2021, compared to $8.0 million in the first quarter of 2020. Our effective tax rate was 20.18% for the first quarter of 2021 compared to 18.76% for the first quarter of 2020. We recognized a reduction in provision for income taxes resulting from excess tax benefits from the exercise and vesting of stock options and restricted stock during the first quarters of 2021 and 2020 of $1.6 million and $1.1 million, respectively.

GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures, including tangible common stockholders’ equity, total tangible assets, tangible book value per share and tangible common equity to total tangible assets, each of which excludes goodwill and core deposit intangibles associated with our acquisition of Metro Bancshares, Inc. in January 2015. We believe these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that these non-GAAP financial measures have a number of limitations. As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies, including those in our industry, use. The following reconciliation table provides a more detailed analysis of the non-GAAP financial measures as of and for the comparative periods presented in this press release. Dollars are in thousands, except share and per share data.

At March 31,
2021

At December 31,
2020

At September 30,
2020

At June 30, 2020

At March 31,
2020

Book value per share - GAAP

$

19.03

$

18.41

$

17.61

$

16.98

$

16.38

Total common stockholders' equity - GAAP

1,030,485

992,852

949,589

914,588

881,885

Adjustments:

Adjusted for goodwill and core deposit intangible asset

13,841

13,908

13,976

14,043

14,111

Tangible common stockholders' equity - non-GAAP

$

1,016,644

$

978,944

$

935,613

$

900,545

$

867,775

Tangible book value per share - non-GAAP

$

18.78

$

18.15

$

17.35

$

16.72

$

16.12

Stockholders' equity to total assets - GAAP

8.15

%

8.32

%

8.33

%

8.31

%

9.42

%

Total assets - GAAP

$

12,647,374

$

11,927,955

$

11,394,874

$

11,012,195

$

9,364,882

Adjustments:

Adjusted for goodwill and core deposit intangible asset

13,841

13,908

13,976

14,043

14,111

Total tangible assets - non-GAAP

$

12,633,533

$

11,914,047

$

11,380,898

$

10,998,152

$

9,350,771

Tangible common equity to total tangible assets - non-GAAP

8.05

%

8.22

%

8.22

%

8.19

%

9.28

%

About ServisFirst Bancshares, Inc.

ServisFirst Bancshares, Inc. is a bank holding company based in Birmingham, Alabama. Through its subsidiary ServisFirst Bank, ServisFirst Bancshares, Inc. provides business and personal financial services from locations in Birmingham, Huntsville, Montgomery, Mobile and Dothan, Alabama, Pensacola, Sarasota and Tampa Bay, Florida, Atlanta, Georgia, Charleston, South Carolina and Nashville, Tennessee.

ServisFirst Bancshares, Inc. files periodic reports with the U.S. Securities and Exchange Commission (SEC). Copies of its filings may be obtained through the SEC’s website at www.sec.gov or at www.servisfirstbancshares.com.

Statements in this press release that are not historical facts, including, but not limited to, statements concerning future operations, results or performance, are hereby identified as "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. The words "believe," "expect," "anticipate," "project," “plan,” “intend,” “will,” “could,” “would,” “might” and similar expressions often signify forward-looking statements. Such statements involve inherent risks and uncertainties. ServisFirst Bancshares, Inc. cautions that such forward-looking statements, wherever they occur in this press release or in other statements attributable to ServisFirst Bancshares, Inc., are necessarily estimates reflecting the judgment of ServisFirst Bancshares, Inc.’s senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Such forward-looking statements should, therefore, be considered in light of various factors that could affect the accuracy of such forward-looking statements, including, but not limited to: the global health and economic crisis precipitated by the COVID-19 outbreak; general economic conditions, especially in the credit markets and in the Southeast; the performance of the capital markets; changes in interest rates, yield curves and interest rate spread relationships; changes in accounting and tax principles, policies or guidelines; changes in legislation or regulatory requirements; changes in our loan portfolio and the deposit base; economic crisis and associated credit issues in industries most impacted by the COVID-19 outbreak, including but not limited to, the restaurant, hospitality and retail sectors; possible changes in laws and regulations and governmental monetary and fiscal policies, including, but not limited to, economic stimulus initiatives; the cost and other effects of legal and administrative cases and similar contingencies; possible changes in the creditworthiness of customers and the possible impairment of the collectability of loans and the value of collateral; the effect of natural disasters, such as hurricanes and tornados, in our geographic markets; and increased competition from both banks and non-bank financial institutions. 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 our most recent Annual Report on Form 10-K, in our Quarterly Reports on Form 10-Q for fiscal year 2020, and our other SEC filings. If one or more of the factors affecting our forward-looking information and statements proves incorrect, then our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements contained herein. Accordingly, you should not place undue reliance on any forward-looking statements, which speak only as of the date made. ServisFirst Bancshares, Inc. assumes no obligation to update or revise any forward-looking statements that are made from time to time.

More information about ServisFirst Bancshares, Inc. may be obtained over the Internet at www.servisfirstbancshares.com or by calling (205) 949-0302.

Contact: ServisFirst Bank
Davis Mange (205) 949-3420
dmange@servisfirstbank.com

SELECTED FINANCIAL HIGHLIGHTS (Unaudited)

(In thousands except share and per share data)

1st Quarter 2021

4th Quarter 2020

3rd Quarter 2020

2nd Quarter 2020

1st Quarter 2020

CONSOLIDATED STATEMENT OF INCOME

Interest income

$

100,396

$

101,065

$

96,110

$

95,080

$

96,767

Interest expense

8,031

8,984

11,028

11,846

19,127

Net interest income

92,365

92,081

85,082

83,234

77,640

Provision for credit losses

7,451

6,283

12,284

10,283

13,584

Net interest income after provision for credit losses

84,914

85,798

72,798

72,951

64,056

Non-interest income

8,463

8,237

8,172

7,033

6,674

Non-interest expense

28,914

28,202

26,573

28,816

27,920

Income before income tax

64,463

65,833

54,397

51,168

42,810

Provision for income tax

13,008

14,852

11,035

10,720

8,032

Net income

51,455

50,981

43,362

40,448

34,778

Preferred stock dividends

-

32

-

31

-

Net income available to common stockholders

$

51,455

$

50,949

$

43,362

$

40,417

$

34,778

Earnings per share - basic

$

0.95

$

0.94

$

0.80

$

0.75

$

0.65

Earnings per share - diluted

$

0.95

$

0.94

$

0.80

$

0.75

$

0.64

Average diluted shares outstanding

54,381,991

54,273,944

54,232,965

54,194,506

54,167,414

CONSOLIDATED BALANCE SHEET DATA

Total assets

$

12,647,374

$

11,932,654

$

11,394,874

$

11,012,195

$

9,364,882

Loans

8,504,980

8,465,688

8,508,544

8,315,375

7,568,836

Debt securities

962,129

886,938

913,299

856,378

827,032

Non-interest-bearing demand deposits

3,044,611

2,788,772

2,762,814

2,678,893

1,925,626

Total deposits

10,577,610

9,975,724

9,673,783

9,342,918

7,832,655

Borrowings

64,691

64,748

64,719

64,715

64,707

Stockholders' equity

$

1,030,485

$

992,852

$

949,589

$

914,588

$

881,885

Shares outstanding

54,137,650

53,943,751

53,915,245

53,874,276

53,844,009

Book value per share

$

19.03

$

18.41

$

17.61

$

16.98

$

16.38

Tangible book value per share (1)

$

18.78

$

18.15

$

17.35

$

16.72

$

16.12

SELECTED FINANCIAL RATIOS (Annualized)

Net interest margin

3.20

%

3.27

%

3.14

%

3.32

%

3.58

%

Return on average assets

1.72

%

1.74

%

1.54

%

1.55

%

1.54

%

Return on average common stockholders' equity

19.83

%

20.78

%

18.43

%

18.40

%

16.23

%

Efficiency ratio

28.68

%

28.11

%

28.50

%

31.92

%

33.11

%

Non-interest expense to average earning assets

1.00

%

1.00

%

0.98

%

1.15

%

1.29

%

CAPITAL RATIOS (2)

Common equity tier 1 capital to risk-weighted assets

10.73

%

10.50

%

11.24

%

11.26

%

10.68

%

Tier 1 capital to risk-weighted assets

10.73

%

10.50

%

11.25

%

11.27

%

10.68

%

Total capital to risk-weighted assets

12.48

%

12.20

%

13.10

%

13.27

%

12.54

%

Tier 1 capital to average assets

8.25

%

8.23

%

8.22

%

8.46

%

9.56

%

Tangible common equity to total tangible assets (1)

8.05

%

8.22

%

8.22

%

8.19

%

9.28

%

(1) See "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" for a discussion of these Non-GAAP financial measures.

(2) Regulatory capital ratios for most recent period are preliminary.


CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(Dollars in thousands)

March 31, 2021

March 31, 2020

% Change

ASSETS

Cash and due from banks

$

70,107

$

80,461

(13

)%

Interest-bearing balances due from depository institutions

2,738,046

297,943

819

%

Federal funds sold

1,577

306,127

(99

)%

Cash and cash equivalents

2,809,730

684,531

310

%

Available for sale debt securities, at fair value

961,879

826,782

16

%

Held to maturity debt securities (fair value of $250 at March 31, 2021 and 2020)

250

250

-

Mortgage loans held for sale

15,834

6,747

135

%

Loans

8,504,980

7,568,836

12

%

Less allowance for credit losses

(94,906

)

(85,414

)

11

%

Loans, net

8,410,074

7,483,422

12

%

Premises and equipment, net

56,472

55,992

1

%

Goodwill and other identifiable intangible assets

13,841

14,111

(2

)%

Other assets

379,294

293,047

29

%

Total assets

$

12,647,374

$

9,364,882

35

%

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Deposits:

Non-interest-bearing

$

3,044,611

$

1,925,626

58

%

Interest-bearing

7,532,999

5,907,029

28

%

Total deposits

10,577,610

7,832,655

35

%

Federal funds purchased

911,558

543,623

68

%

Other borrowings

64,691

64,707

-

%

Other liabilities

63,030

42,012

50

%

Total liabilities

11,616,889

8,482,997

37

%

Stockholders' equity:

Preferred stock, par value $0.001 per share; 1,000,000 authorized and undesignated at

March 31, 2021 and March 31, 2020

-

-

Common stock, par value $0.001 per share; 100,000,000 shares authorized; 54,137,650 shares

issued and outstanding at March 31, 2021, and 53,844,009 shares issued and outstanding

at March 31, 2020

54

54

-

%

Additional paid-in capital

224,302

221,901

1

%

Retained earnings

788,875

641,980

23

%

Accumulated other comprehensive income

16,754

17,448

(4

)%

Total stockholders' equity attributable to ServisFirst Bancshares, Inc.

1,029,985

881,383

17

%

Noncontrolling interest

500

502

-

%

Total stockholders' equity

1,030,485

881,885

17

%

Total liabilities and stockholders' equity

$

12,647,374

$

9,364,882

35

%


CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(In thousands except per share data)

Three Months Ended March 31,

2021

2020

Interest income:

Interest and fees on loans

$

93,803

$

89,385

Taxable securities

5,807

5,154

Nontaxable securities

107

233

Federal funds sold

3

277

Other interest and dividends

676

1,718

Total interest income

100,396

96,767

Interest expense:

Deposits

6,881

16,745

Borrowed funds

1,150

2,382

Total interest expense

8,031

19,127

Net interest income

92,365

77,640

Provision for credit losses

7,451

13,584

Net interest income after provision for credit losses

84,914

64,056

Non-interest income:

Service charges on deposit accounts

1,908

1,916

Mortgage banking

2,747

1,071

Credit card income

1,192

1,765

Increase in cash surrender value life insurance

1,658

1,453

Other operating income

958

469

Total non-interest income

8,463

6,674

Non-interest expense:

Salaries and employee benefits

15,543

15,658

Equipment and occupancy expense

2,654

2,400

Third party processing and other services

3,416

3,457

Professional services

923

948

FDIC and other regulatory assessments

1,582

1,332

Other real estate owned expense

157

601

Other operating expense

4,639

3,524

Total non-interest expense

28,914

27,920

Income before income tax

64,463

42,810

Provision for income tax

13,008

8,032

Net income

51,455

34,778

Dividends on preferred stock

-

-

Net income available to common stockholders

$

51,455

$

34,778

Basic earnings per common share

$

0.95

$

0.65

Diluted earnings per common share

$

0.95

$

0.64


LOANS BY TYPE (UNAUDITED)

(In thousands)

1st Quarter 2021

4th Quarter 2020

3rd Quarter 2020

2nd Quarter 2020

1st Quarter 2020

Commercial, financial and agricultural

$

3,323,093

$

3,295,900

$

3,466,189

$

3,498,627

$

2,771,307

Real estate - construction

666,592

593,614

530,919

544,586

548,578

Real estate - mortgage:

Owner-occupied commercial

1,698,695

1,693,428

1,725,222

1,634,495

1,678,532

1-4 family mortgage

685,840

711,692

671,841

665,883

675,870

Other mortgage

2,068,560

2,106,184

2,056,549

1,911,384

1,834,137

Subtotal: Real estate - mortgage

4,453,095

4,511,304

4,453,612

4,211,762

4,188,539

Consumer

62,200

64,870

57,834

60,400

60,412

Total loans

$

8,504,980

$

8,465,688

$

8,508,554

$

8,315,375

$

7,568,836


SUMMARY OF CREDIT LOSS EXPERIENCE (UNAUDITED)

(Dollars in thousands)

1st Quarter 2021

4th Quarter 2020

3rd Quarter 2020

2nd Quarter 2020

1st Quarter 2020

Allowance for credit losses:

Beginning balance

$

87,942

$

92,440

$

91,507

$

85,414

$

76,584

Impact of Adoption of ASC 326

-

(2,000

)

-

-

-

Loans charged off:

Commercial financial and agricultural

477

8,792

11,146

1,358

2,640

Real estate - construction

-

202

-

376

454

Real estate - mortgage

12

-

200

2,520

1,678

Consumer

87

38

44

62

58

Total charge offs

576

9,032

11,390

4,316

4,830

Recoveries:

Commercial financial and agricultural

26

94

12

84

62

Real estate - construction

50

30

-

1

1

Real estate - mortgage

2

114

12

13

1

Consumer

11

13

15

28

12

Total recoveries

89

251

39

126

76

Net charge-offs

487

8,781

11,351

4,190

4,754

Provision for credit losses

7,451

6,283

12,284

10,283

13,584

Ending balance

$

94,906

$

87,942

$

92,440

$

91,507

$

85,414

Allowance for credit losses to total loans

1.12

%

1.04

%

-

-

-

Allowance for credit losses to total average

loans

1.11

%

1.04

%

-

-

-

Allowance for loan losses to total loans

-

-

1.09

%

1.10

%

1.13

%

Allowance for loan losses to total average

loans

-

-

1.11

%

1.10

%

1.16

%

Net charge-offs to total average loans

0.02

%

0.41

%

0.54

%

0.20

%

0.26

%

Provision for credit losses to total average

loans

0.35

%

0.30

%

-

-

-

Provision for loan losses to total average

loans

-

-

0.58

%

0.50

%

0.74

%

Nonperforming assets:

Nonaccrual loans

$

13,888

$

13,973

$

21,675

$

16,881

$

28,914

Loans 90+ days past due and accruing

4,804

4,981

4,898

5,133

4,954

Other real estate owned and

repossessed assets

2,067

6,497

6,976

6,537

7,448

Total

$

20,759

$

25,451

$

33,549

$

28,551

$

41,316

Nonperforming loans to total loans

0.22

%

0.22

%

0.31

%

0.26

%

0.45

%

Nonperforming assets to total assets

0.16

%

0.21

%

0.29

%

0.26

%

0.44

%

Nonperforming assets to earning assets

0.17

%

0.22

%

0.30

%

0.26

%

0.45

%

Allowance for credit losses to nonaccrual loans

683.37

%

629.37

%

-

-

-

Allowance for loan losses to nonaccrual loans

-

-

426.48

%

542.07

%

295.41

%

Restructured accruing loans

$

794

$

818

$

1,800

$

975

$

975

Restructured accruing loans to total loans

0.01

%

0.01

%

0.02

%

0.01

%

0.01

%

TROUBLED DEBT RESTRUCTURINGS (TDRs) (UNAUDITED)

(In thousands)

1st Quarter 2021

4th Quarter 2020

3rd Quarter 2020

2nd Quarter 2020

1st Quarter 2020

Beginning balance:

$

1,433

$

2,738

$

1,568

$

2,367

$

3,330

Additions

2,146

-

1,182

-

350

Net (paydowns) / advances

(37

)

(619

)

(12

)

(12

)

(232

)

Charge-offs

-

(535

)

-

(412

)

(1,081

)

Transfer to OREO

-

(151

)

-

(375

)

-

Ending balance

$

3,542

$

1,433

$

2,738

$

1,568

$

2,367


CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(In thousands except per share data)

1st Quarter 2021

4th Quarter 2020

3rd Quarter 2020

2nd Quarter 2020

1st Quarter 2020

Interest income:

Interest and fees on loans

$

93,803

$

94,332

$

89,564

$

89,383

$

89,385

Taxable securities

5,807

6,018

5,858

5,092

5,154

Nontaxable securities

107

129

166

211

233

Federal funds sold

3

5

16

34

277

Other interest and dividends

676

581

506

360

1,718

Total interest income

100,396

101,065

96,110

95,080

96,767

Interest expense:

Deposits

6,881

7,853

9,876

10,756

16,745

Borrowed funds

1,150

1,131

1,152

1,090

2,382

Total interest expense

8,031

8,984

11,028

11,846

19,127

Net interest income

92,365

92,081

85,082

83,234

77,640

Provision for credit losses

7,451

6,283

12,284

10,283

13,584

Net interest income after provision for credit losses

84,914

85,798

72,798

72,951

64,056

Non-interest income:

Service charges on deposit accounts

1,908

1,971

1,818

1,823

1,916

Mortgage banking

2,747

3,050

2,519

2,107

1,071

Credit card income

1,192

913

1,840

1,398

1,765

Increase in cash surrender value life insurance

1,658

1,660

1,733

1,464

1,453

Other operating income

958

643

262

241

469

Total non-interest income

8,463

8,237

8,172

7,033

6,674

Non-interest expense:

Salaries and employee benefits

15,543

14,970

14,994

15,792

15,658

Equipment and occupancy expense

2,654

2,680

2,556

2,434

2,400

Third party processing and other services

3,416

3,418

3,281

3,622

3,457

Professional services

923

1,248

955

1,091

948

FDIC and other regulatory assessments

1,582

1,366

1,061

595

1,332

Other real estate owned expense

157

140

119

1,303

601

Other operating expense

4,639

4,380

3,607

3,979

3,524

Total non-interest expense

28,914

28,202

26,573

28,816

27,920

Income before income tax

64,463

65,833

54,397

51,168

42,810

Provision for income tax

13,008

14,852

11,035

10,720

8,032

Net income

51,455

50,981

43,362

40,448

34,778

Dividends on preferred stock

-

32

-

31

-

Net income available to common stockholders

$

51,455

$

50,949

$

43,362

$

40,417

$

34,778

Basic earnings per common share

$

0.95

$

0.94

$

0.80

$

0.75

$

0.65

Diluted earnings per common share

$

0.95

$

0.94

$

0.80

$

0.75

$

0.64


AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS (UNAUDITED)

ON A FULLY TAXABLE-EQUIVALENT BASIS

(Dollars in thousands)

1st Quarter 2021

4th Quarter 2020

3rd Quarter 2020

2nd Quarter 2020

1st Quarter 2020

Average Balance

Yield / Rate

Average Balance

Yield / Rate

Average Balance

Yield / Rate

Average Balance

Yield / Rate

Average Balance

Yield / Rate

Assets:

Interest-earning assets:

Loans, net of unearned income (1)

Taxable

$

8,484,914

4.47

%

$

8,435,237

4.43

%

$

8,335,087

4.26

%

$

8,301,775

4.31

%

$

7,328,594

4.89

%

Tax-exempt (2)

27,592

4.17

29,393

4.16

30,068

4.14

31,929

4.12

32,555

4.04

Total loans, net of

unearned income

8,512,506

4.47

8,464,630

4.43

8,365,155

4.26

8,333,704

4.31

7,361,149

4.88

Mortgage loans held for sale

13,601

1.94

19,459

1.37

20,053

1.41

13,278

2.09

4,282

2.16

Debt securities:

Taxable

878,118

2.65

862,333

2.79

820,526

2.86

761,575

2.67

750,413

2.75

Tax-exempt (2)

21,084

2.43

25,542

2.52

31,880

2.51

38,201

2.62

44,029

2.33

Total securities (3)

899,202

2.64

887,875

2.78

852,406

2.84

799,776

2.67

794,442

2.72

Federal funds sold

11,935

0.10

16,306

0.12

41,884

0.15

83,274

0.16

105,423

1.06

Interest-bearing balances with banks

2,262,233

0.12

1,837,249

0.13

1,500,563

0.13

849,549

0.17

469,199

1.47

Total interest-earning assets

$

11,699,477

3.48

%

$

11,225,519

3.58

%

$

10,780,061

3.55

%

$

10,079,581

3.80

%

$

8,734,495

4.46

%

Non-interest-earning assets:

Cash and due from banks

71,166

91,258

75,065

76,212

66,140

Net premises and equipment

57,198

56,315

56,799

57,446

58,066

Allowance for credit losses, accrued

interest and other assets

320,407

308,746

281,196

248,702

241,479

Total assets

$

12,148,248

$

11,681,838

$

11,193,121

$

10,461,941

$

9,100,180

Interest-bearing liabilities:

Interest-bearing deposits:

Checking

$

1,294,614

0.19

%

$

1,197,908

0.23

%

$

1,077,595

0.31

%

$

992,848

0.35

%

$

956,803

0.57

%

Savings

93,375

0.18

86,259

0.18

82,671

0.36

72,139

0.42

67,380

0.50

Money market

5,057,828

0.27

4,933,285

0.31

4,739,566

0.44

4,285,907

0.52

4,061,286

1.10

Time deposits

808,561

1.44

810,675

1.59

841,378

1.78

877,448

1.95

805,924

2.09

Total interest-bearing deposits

7,254,378

0.38

7,028,127

0.44

6,741,210

0.58

6,228,342

0.69

5,891,393

1.14

Federal funds purchased

849,772

0.22

752,765

0.22

682,971

0.22

572,990

0.22

492,638

1.31

Other borrowings

64,689

4.33

64,701

4.41

64,717

4.78

64,711

4.85

64,707

4.85

Total interest-bearing liabilities

$

8,168,839

0.40

%

$

7,845,593

0.46

%

$

7,488,898

0.59

%

$

6,866,043

0.69

%

$

6,448,738

1.19

%

Non-interest-bearing liabilities:

Non-interest-bearing

demand deposits

2,923,041

2,812,254

2,728,513

2,646,030

1,749,671

Other liabilities

39,442

48,642

39,537

69,061

39,801

Stockholders' equity

996,741

956,847

917,626

862,500

853,800

Accumulated other comprehensive

income

20,185

18,502

18,547

18,307

8,170

Total liabilities and

stockholders' equity

$

12,148,248

$

11,681,838

$

11,193,121

$

10,461,941

$

9,100,180

Net interest spread

3.08

%

3.12

%

2.96

%

3.11

%

3.27

%

Net interest margin

3.20

%

3.27

%

3.14

%

3.32

%

3.58

%

(1

)

Average loans include loans on which the accrual of interest has been discontinued.

(2

)

Interest income and yields are presented on a fully taxable equivalent basis using a tax rate of 21%.

(3

)

Unrealized losses on available-for-sale debt securities are excluded from the yield calculation.



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