Simmons Reports Second Quarter 2021 Earnings

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Board of Directors extends and increases authorization under share repurchase program

  • Net income of $74.9 million, up 27 percent from the year ago quarter and up 11 percent compared to the first quarter of 2021

  • Diluted EPS of $0.69, up 28 percent from the year ago quarter and up 11 percent compared to the first quarter of 2021

  • Adjusted pre-tax, pre-provision income of $74.6 million, up 2 percent from first quarter 2021 levels

  • Loan production totaled $1.8 billion during the first half of 2021, on pace to significantly exceed production volume for full-year of 2020

  • Total deposits of $18.3 billion, up $1.3 billion since year-end 2020 while deposits costs dropped 10 bps over the same period

  • Improved macroeconomic scenario models and sharp decline in nonperforming loans (down $34.6 million linked quarter) drive $13.0 million provision expense recapture in the quarter

  • Merger and acquisition activity resumes during the quarter with announced pending acquisitions of Tennessee-based Landmark Community Bank and Triumph Bancshares, Inc.

PINE BLUFF, Ark., July 27, 2021 (GLOBE NEWSWIRE) -- Simmons First National Corporation (NASDAQ: SFNC) (the “Company” or “Simmons”) today reported net income of $74.9 million for the second quarter of 2021 compared to net income of $58.8 million for the second quarter of 2020, an increase of $16.1 million, or 27 percent. Diluted earnings per share for the second quarter of 2021 were $0.69, an increase of $0.15, or 28 percent, compared to the same period in the prior year. Included in second quarter 2021 results were $524,000 in net after-tax merger-related and net branch right-sizing costs. Excluding the impact of these items, core earnings were $75.4 million for the second quarter of 2021, compared to $60.1 million for the second quarter of 2020, an increase of $15.3 million, or 25 percent. Core diluted earnings per share were $0.69, an increase of $0.14, or 25 percent, from the comparable period in 2020.

On a year-to-date basis, net income for the first half of 2021 was $142.3 million, or $1.31 diluted earnings per share, compared to $136.0 million, or $1.22 diluted earnings per share, for the first half of 2020. Excluding $2.9 million in net after-tax merger-related and net branch right-sizing costs and the after-tax gain primarily associated with the sale of branches in Illinois, core earnings for the first half of 2021 were $139.4 million, an increase of $5.4 million compared to the first half of last year. Core diluted earnings per share for the first half of 2021 were $1.28, an increase of $0.07, or 6 percent, from the comparable period of 2020.

“Overall we were very pleased with our results for the quarter as we delivered solid performance in multiple areas while continuing to navigate the challenging environment,” said George A, Makris, Jr., Simmons’ chairman and CEO. “While loan growth throughout the financial services industry continues to be hampered by the significant amounts of government stimulus in the economy that has resulted in sluggish loan demand and historically high levels of paydowns, Simmons generated $1.8 billion in loan originations and advances during the first half of 2021, putting us on pace to significantly exceed loan production volume reported for the full-year of 2020. Our commercial loan pipeline has increased for three consecutive quarters and we are cautiously optimistic that this trend is a positive sign going forward.”

“At the same time, asset quality metrics continued to improve as certain initially anticipated impacts of the COVID-19 pandemic on asset quality have thus far failed to materialize. As such, we recorded the recapture of $13.0 million of provision expense during the quarter while maintaining our nonperforming loan coverage ratio and an appropriate allowance to loan ratio that is reflective of the uncertainty in the economy and associated risk in our loan portfolio. As a result of our solid results in the quarter and our strong asset quality and capital positions, Simmons’ board of directors extended and increased the authorization under our share repurchase program, thus increasing our remaining capacity under the program to approximately $150 million and extending the program’s scheduled expiration to October 2022.”

Selected Highlights:

2nd Qtr 2021

1st Qtr 2021

2nd Qtr 2020

Net income

$74.9 million

$67.4 million

$58.8 million

Diluted earnings per share

$0.69

$0.62

$0.54

Return on avg assets

1.29%

1.20%

1.08%

Return on avg common equity

10.08%

9.20%

8.21%

Return on tangible common equity (1)

17.25%

15.85%

14.55%

Core earnings (2)

$75.4 million

$64.0 million

$60.1 million

Core diluted earnings per share (2)

$0.69

$0.59

$0.55

Core return on avg assets (2)

1.30%

1.14%

1.11%

Core return on avg common equity (2)

10.15%

8.73%

8.40%

Core return on tangible common equity (1)(2)

17.36%

15.08%

14.87%

Efficiency ratio (3)

56.93%

57.43%

51.13%

Adjusted pre-tax, pre-provision earnings (2)

$74.6 million

$73.1 million

$97.7 million


(1)

Return on tangible common equity excludes goodwill and other intangible assets and is a non-GAAP measurement. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

(2)

Core figures exclude non-core items and are non-GAAP measurements. Adjusted pre-tax, pre-provision earnings exclude provision for income taxes, provisions for credit losses and unfunded commitments, gains on sales of securities, and other pre-tax, non-core items, and is also a non-GAAP measurement. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

(3)

Efficiency ratio is core non-interest expense before foreclosed property expense and amortization of intangibles, as a percent of net interest income (fully taxable equivalent) and non-interest revenues, excluding gains and losses from securities transactions and non-core items, and is a non-GAAP measurement. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

Loans

($ in billions)

2nd Qtr 2021

1st Qtr 2021

2nd Qtr 2020

Total loans

$11.4

$12.2

$14.6

Total loans at the end of the second quarter of 2021 were $11.4 billion compared to $12.2 billion at the end of the first quarter of 2021 and $14.6 billion at the end of the second quarter of 2020. Total loan production (loan originations and advances) for the first half of 2021 totaled $1.8 billion. While loan originations and advances are outpacing prior year production, the decline in loan balances reflects the substantial government stimulus to support the economy during the COVID-19 pandemic which contributed to an increase in the level of loan paydowns, payoffs and corresponding sluggish loan demand throughout the financial services industry. The Company’s balance of Paycheck Protection Program (“PPP”) loans totaled $441.4 million at the end of the second quarter of 2021, down $463.3 million during the first half of 2021 as originations under PPP Round 2 have been offset by loan forgiveness.

Despite these headwinds, loan demand appears to be returning to more normalized levels. For the third consecutive quarter, the Company experienced an increase in its commercial loan demand. The Company’s total commercial loan pipeline consisting of all loan opportunities was $1.3 billion compared to $674 million at December 31, 2020. Loans approved and ready to close at the end of the quarter totaled $467 million.

PPP Loans

($ in millions)

PPP Round 1

PPP Round 2

Total PPP Loans

Beginning balance, January 1, 2021

$904.7

$ -

$904.7

PPP loan originations

-

318.9

318.9

PPP loan forgiveness and repayments

(763.9)

(18.3)

(782.2)

Ending balance, June 30, 2021

$140.8

$300.6

$441.4

Deposits

($ in billions)

2nd Qtr 2021

1st Qtr 2021

2nd Qtr 2020

Total deposits

$18.3

$18.2

$16.6

Noninterest bearing deposits

$4.9

$4.9

$4.6

Interest bearing deposits

$10.6

$10.3

$9.0

Time deposits

$2.8

$3.0

$3.0

Total deposits at the end of the second quarter of 2021 were $18.3 billion, an increase of $1.7 billion or 10 percent from $16.6 billion at the end of the second quarter of 2020. The increase in total deposits from a year ago was driven by a $1.6 billion increase in interest bearing deposits (checking, savings and money market accounts) which totaled $10.6 billion at the end of the second quarter of 2021. Noninterest bearing deposits also contributed to the year-over-year growth in total deposits, increasing $285.9 million or 6 percent while time deposits declined $188.9 million or 6 percent during the same period.

Net Interest Income

2nd Qtr
2021

1st Qtr
2021

4th Qtr
2020

3rd Qtr
2020

2nd Qtr
2020

Loan yield (1)

4.73%

4.75%

4.74%

4.54%

4.84%

Core loan yield (1) (2)

4.54%

4.53%

4.47%

4.29%

4.52%

Security yield (1)

1.97%

2.36%

2.48%

2.60%

2.50%

Cost of interest bearing deposits

0.32%

0.41%

0.47%

0.54%

0.59%

Cost of deposits (3)

0.24%

0.30%

0.34%

0.39%

0.44%

Cost of borrowed funds

1.97%

1.91%

1.88%

1.85%

1.84%

Net interest margin (1)

2.89%

2.99%

3.22%

3.21%

3.42%

Core net interest margin (1) (2)

2.78%

2.86%

3.04%

3.02%

3.18%


(1)

Fully tax equivalent using an effective tax rate of 26.135%.

(2)

Core loan yield and core net interest margin exclude accretion and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

(3)

Includes non-interest bearing deposits.

Net interest income for the second quarter of 2021 totaled $146.5 million, compared to $146.7 million in the first quarter of 2021 and $163.7 million in the second quarter of 2020. Included in net interest income is accretion recognized on loans acquired totaling $5.6 million in the second quarter of 2021, $6.6 million in the first quarter of 2021 and $11.7 million in the second quarter of 2020. Excluding the impact of accretion, core net interest income for the second quarter of 2021 increased 1 percent on a linked quarter basis.

The decrease in net interest income from the year ago quarter reflects a lower average loan balance combined with an 11 basis point decrease in loan yields. To offset the expected pressure on net interest income given the current low interest rate environment, the Company has been diligent in its efforts to reduce deposits costs. As a result, cost of deposits for the second quarter of 2021 was 24 basis points, down 6 basis points on a linked quarter basis and 20 basis points compared to the second quarter of 2020.

While loan yields declined from the year ago quarter, on a linked quarter basis loan yields declined only 2 basis points. The core loan yield, which excludes accretion, for the second quarter of 2021 was 4.54 percent, up 1 basis point compared to the first quarter of 2021 and up 2 basis points compared to the second quarter a year ago. The yield on PPP loans was approximately 5.08 percent during the second quarter of 2021 (including accretion of net fees), which increased the overall loan yield by approximately 2 basis points.

The net interest margin on a fully taxable equivalent basis was 2.89 percent for the second quarter of 2021 compared to 2.99 percent for the first quarter of 2021 and 3.42 percent for the second quarter of 2020. Core net interest margin (excluding accretion on acquired loans) was 2.78 percent compared to 2.86 percent for the first quarter of 2021 and 3.18 percent for the second quarter of 2020. During the second quarter of 2021, the Company purchased $2.5 billion of investment securities. This included the strategic redeployment of excess liquidity through the purchase of variable rate investment securities totaling approximately $1.1 billion. Consequently, the duration of the investment securities portfolio shortened from 6.5 years at March 31, 2021 to 4.9 years at June 30, 2021.

Noninterest Income
Noninterest income for the second quarter of 2021 was $47.9 million compared to $50.3 million in the first quarter of 2021 and $48.8 million in the second quarter of 2020. Gains on the sale of investment securities totaled $5.1 million in the second quarter of 2021, $5.5 million in the first quarter of 2021 and $390,000 in the second quarter of 2020. Core noninterest income totaled $47.5 million in the second quarter of 2021 compared to $44.9 million in the first quarter of 2021 and $46.6 million in the second quarter of 2020. Core noninterest income excludes gains on the sale of branches which totaled $445,000 in the second quarter of 2021, $5.5 million in the first quarter of 2021 and $2.2 million in the second quarter of 2020.

Select Noninterest Income Items
($ in millions)

2nd Qtr
2021

1st Qtr
2021

4th Qtr
2020

3rd Qtr
2020

2nd Qtr
2020

Service charges on deposit accounts

$10.1

$9.7

$10.8

$10.4

$8.6

Trust income

$7.2

$6.7

$6.6

$6.7

$7.3

Mortgage lending income

$4.5

$6.4

$3.0

$14.0

$12.5

SBA lending income

$0.3

$0.2

$0.5

$0.3

$0.2

Debit and credit card fees (1)

$7.9

$7.4

$7.2

$7.2

$6.6

Gain on sale of securities

$5.1

$5.5

-

$22.3

$0.4

Other income

$8.1

$10.3

$10.6

$5.4

$9.8

Core other income (2)

$7.7

$4.8

$10.3

$5.0

$7.6


(1)

During the second quarter of 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest income. Prior periods have been adjusted to reflect this reclassification.

(2)

Core figures exclude non-core items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

Noninterest Expense
Noninterest expense for the second quarter of 2021 totaled $115.5 million compared to $113.8 million for the first quarter of 2021 and $116.2 million for the second quarter of 2020. Included in noninterest expense are pre-tax, non- core items for merger-related expenses and branch right sizing costs. Excluding these items, core noninterest expense was $114.3 million for the second quarter of 2021, $112.9 million for the first quarter of 2021 and $112.1 million for the second quarter of 2020. Overall expenses were well contained, increasing 1 percent from first quarter 2021 levels both on a reported basis and on a core basis. The efficiency ratio for the second quarter of 2021 was 56.93 percent compared to 57.43 percent for the first quarter of 2021 and 51.13 percent for the second quarter of 2020. As part of its ongoing branch right sizing initiative, the Company announced plans to close 12 branches during the third quarter of 2021.

Select Noninterest Expense Items
($ in millions)

2nd Qtr
2021

1st Qtr
2021

4th Qtr
2020

3rd Qtr
2020

2nd Qtr
2020

Salaries and employee benefits

$60.3

$60.3

$55.8

$61.1

$57.6

Merger related costs

$0.7

$0.2

$0.7

$0.9

$1.8

Other operating expenses (1)

$38.0

$36.9

$52.8

$36.5

$38.2

Core salaries and employee benefits (2)

$60.3

$60.3

$55.6

$58.7

$57.2

Core merger related costs (2)

-

-

-

-

-

Core other operating expenses (2)

$37.9

$36.6

$42.6

$36.5

$36.6


(1)

During the second quarter of 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest income. Prior periods have been adjusted to reflect this reclassification.

(2)

Core figures exclude non-core items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

Asset Quality



($ in millions)

2nd Qtr
2021

1st Qtr
2021

4th Qtr
2020

3rd Qtr
2020

2nd Qtr
2020

Allowance for credit losses on loans to total loans

2.00%

1.93%

1.85%

1.77%

1.59%

Allowance for credit losses on loans to nonperforming loans

281%

204%

193%

148%

176%

Nonperforming loans to total loans

0.71%

0.95%

0.96%

1.20%

0.90%

Net charge-off ratio (annualized)

(0.07%)

0.10%

0.52%

0.16%

1.04%

Net charge-off ratio YTD (annualized)

0.01%

0.10%

0.45%

0.43%

0.56%

Total nonperforming loans

$80.9

$115.5

$123.5

$167.9

$131.9

Total other nonperforming assets

$16.3

$12.4

$20.4

$14.6

$16.1

Asset quality metrics continued to show marked improvement during the quarter. Total nonperforming loans at the end of the quarter totaled $80.9 million, down $34.6 million compared to $115.5 million at the end of the first quarter of 2021 and down $50.9 million from the second quarter of 2020. Net charge-offs as a percentage of average total loans for the quarter were negative 7 basis points, reflecting $2.2 million of loan charge-offs completely offset by $4.3 million of recoveries. Provision for credit losses in the quarter was a credit of $13 million, including $10 million associated with the loan portfolio. The recapture of provision for credit losses reflected continued positive trends in asset quality metrics, combined with improved economic modeling scenarios. As a result, the allowance for credit losses at the end of the second quarter of 2021 totaled $227.2 million compared to $235.1 million at the end of the first quarter of 2021 and $231.6 million at the end of the second quarter of 2020. At the same time, the allowance to loan ratio rose 7 basis points to 2.00 percent compared to 1.93 percent at the end of the first quarter of 2021 and 1.59 percent at the end of the second quarter of 2020. The nonperforming loan coverage ratio remains strong at 281 percent compared to 204 percent at the end of the first quarter of 2021 and 176 percent at the end of the second quarter of 2020.

Foreclosed Assets and Other Real Estate Owned
At June 30, 2021, foreclosed assets and other real estate owned (“OREO”) totaled $15.2 million compared to $11.2 million at the March 31, 2021 and $14.1 million at June 30, 2020. The increase on a linked quarter basis is primarily due to $4.4 million in closed bank branch facilities. A breakdown of the composition of foreclosed assets and OREO is provided in the table below:



($ in millions)

2nd Qtr
2021

1st Qtr
2021

4th Qtr
2020

3rd Qtr
2020

2nd Qtr
2020

Closed bank branches and branch sites

$4.4

$0.5

$0.6

$0.6

$2.7

Foreclosed assets – acquired

$6.7

$7.7

$15.3

$9.3

$9.2

Foreclosed assets – legacy

$4.1

$3.0

$2.5

$2.7

$2.2

Capital

2nd Qtr
2021

1st Qtr
2021

4th Qtr
2020

3rd Qtr
2020

2nd Qtr
2020

Stockholders’ equity to total assets

13.0%

12.6%

13.3%

13.7%

13.3%

Tangible common equity to tangible assets (1)

8.4%

7.9%

8.5%

8.7%

8.3%

Regulatory common equity tier 1 ratio

14.2%

14.1%

13.4%

12.6%

11.9%

Regulatory tier 1 leverage ratio

9.0%

9.0%

9.1%

9.1%

8.8%

Regulatory tier 1 risk-based capital ratio

14.2%

14.1%

13.4%

12.6%

11.9%

Regulatory total risk-based capital ratio

17.5%

17.5%

16.8%

15.8%

14.9%


(1)

Tangible common equity to tangible assets is a non-GAAP measurement. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

Total common stockholders’ equity at the end of the quarter totaled $3.0 billion compared to $2.9 billion at the end of the first quarter of 2021 and the second quarter of 2020. Book value per share at the end of the quarter was $28.03 compared to $27.04 at the end of the first quarter of 2021 and $26.64 at the end of the second quarter of 2020. Tangible book value per share was $17.16, up $1.03 from $16.13 reported at the end of the first quarter of 2021 and up $1.37 from $15.79 reported at the end of the second quarter of 2020. The ratio of stockholders’ equity to total assets at June 30, 2021 was 13.0 percent while tangible common equity to tangible total assets was 8.4 percent. All of the Company’s regulatory capital ratios continue to exceed the requirements under “well-capitalized” guidelines. The Company did not repurchase shares during the second quarter of 2021 primarily as a result of its merger and acquisition activity.

Share Repurchase Program
The Company’s board of directors approved an amendment to the Company’s stock repurchase program (“Program”) that increases the amount of the Company’s common stock that may be repurchased under the Program from a maximum of $180 million to a maximum of $276.5 million and extends the term of the Program from October 31, 2021, to October 31, 2022 (unless terminated sooner). The Program was originally approved on October 17, 2019 and amended in March 2020, and to date, the Company has repurchased approximately $126.5 million of its common stock under the Program.

The Program permits the Company to repurchase shares of its common stock through open market and privately negotiated transactions or otherwise. The timing, pricing, and amount of any repurchases under the Program will be determined by the Company’s management at its discretion based on a variety of factors, including, but not limited to, trading volume and market price of the common stock, corporate considerations, the Company’s working capital and investment requirements, general market and economic conditions, and legal requirements. The Program does not obligate the Company to repurchase any common stock and may be modified, discontinued, or suspended at any time without prior notice.

Simmons First National Corporation
Simmons First National Corporation (NASDAQ: SFNC) is an approximately $23.4 billion asset Mid-South based financial holding company whose principal subsidiary, Simmons Bank, operates 198 financial centers, including 68 in Arkansas, 48 in Missouri, 33 in Tennessee, 23 in Texas, 20 in Oklahoma and 6 in Kansas. Founded in 1903, Simmons Bank offers comprehensive financial solutions delivered with a client-centric approach. Simmons Bank was recently named to Forbes’ list of “World’s Best Banks” for the second consecutive year and ranked among the top 30 banks in Forbes’ list of “America’s Best Banks” for 2021. Additional information about Simmons and Simmons Bank can be found on our website at simmonsbank.com, by following @Simmons_Bank on Twitter or by visiting our newsroom.

Conference Call
Management will conduct a live conference call to review this information beginning at 9:00 a.m. CDT today, Tuesday, July 27, 2021. Interested persons can listen to this call by dialing toll-free 1-866-298-7926 (United States and Canada only) and asking for the Simmons First National Corporation conference call, conference ID 8482416. In addition, the call will be available live or in recorded version on the Company’s website at simmonsbank.com for at least 60 days.

Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance. These measures adjust GAAP performance measures to, among other things, include the tax benefit associated with revenue items that are tax-exempt, as well as exclude from income available to common shareholders, non-interest income, and non-interest expense certain income and expenses related to significant non-core activities, including merger-related expenses, gain on sale of branches, early retirement program expenses and net branch right-sizing expenses. In addition, the Company also presents certain figures based on tangible common stockholders’ equity, tangible assets and tangible book value, which exclude goodwill and other intangible assets. The Company further presents certain figures that are exclusive of the impact of PPP loans. The Company’s management believes that these non-GAAP financial measures are useful to investors because they, among other things, present the results of the Company’s ongoing operations without the effect of mergers or other items not central to the Company’s ongoing business, as well as normalize for tax effects. Management, therefore, believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core businesses, and management uses these non-GAAP financial measures to assess the performance of the Company’s core businesses as related to prior financial periods. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.

Forward-Looking Statements
Some of the statements in this news release may not be based on historical facts and should be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including, without limitation, statements made in Mr. Makris’s quotes, may be identified by reference to future periods or by the use of forward-looking terminology, such as “believe,” “budget,” “expect,” “foresee,” “anticipate,” “intend,” “indicate,” “target,” “estimate,” “plan,” “project,” “continue,” “contemplate,” “positions,” “prospects,” “predict,” or “potential,” by future conditional verbs such as “will,” “would,” “should,” “could,” “might” or “may,” or by variations of such words or by similar expressions. These forward-looking statements include, without limitation, statements relating to Simmons’ future growth, lending capacity and lending activity, loan demand, revenue, assets, asset quality, profitability, net interest margin, non-interest revenue, share repurchase program, acquisition strategy, digital banking initiatives, the Company’s ability to recruit and retain key employees, the benefits associated with the Company’s early retirement program, branch closures and branch sales, the adequacy of the allowance for credit losses, the ability of the Company to manage the impact of the COVID-19 pandemic, and the impacts of the Company’s and its customers participation in the PPP. Any forward-looking statement speaks only as of the date of this news release, and Simmons undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release. By nature, forward-looking statements are based on various assumptions and involve inherent risk and uncertainties. Various factors, including, but not limited to, changes in economic conditions, credit quality, interest rates, loan demand, deposit flows, real estate values, the assumptions used in making the forward-looking statements, the securities markets generally or the price of Simmons common stock specifically, and information technology affecting the financial industry; the effect of steps the Company takes and has taken in response to the COVID-19 pandemic; the severity and duration of the pandemic, including the effectiveness of vaccination efforts and developments with respect to COVID-19 variants; the pace of recovery when the pandemic subsides and the heightened impact it has on many of the risks described herein; the effects of the COVID-19 pandemic on, among other things, the Company’s operations, liquidity, and credit quality; general economic and market conditions; unemployment; claims, damages, and fines related to litigation or government actions, including litigation or actions arising from the Company’s participation in and administration of programs related to the COVID-19 pandemic (including, among other things, the PPP loan program authorized by the Coronavirus Aid, Relief and Economic Security Act); changes in accounting principles relating to loan loss recognition (current expected credit losses, or CECL); the Company’s ability to manage and successfully integrate its mergers and acquisitions; cyber threats, attacks or events; reliance on third parties for key services; government legislation; and other factors, many of which are beyond the control of the Company, could cause actual results to differ materially from those contemplated by the forward-looking statements. Additional information on factors that might affect the Company’s financial results is included in the Company’s Form 10-K for the year ended December 31, 2020, which has been filed with, and is available from, the U.S. Securities and Exchange Commission.

Important Additional Information and Where to Find It
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval with respect to the proposed transactions (“Proposed Transactions”) with Landmark Community Bank (“Landmark”) and Triumph Bancshares, Inc. (“Triumph”). No offer of securities shall be made except by means of a prospectus meeting the requirements of the Securities Act of 1933, as amended, and no offer to sell or solicitation of an offer to buy shall be made in any jurisdiction in which such offer, solicitation or sale would be unlawful.

In connection with the Proposed Transactions, the Company has filed with the SEC a registration statement on Form S-4 (the “Registration Statement”) that includes proxy statements of each of Landmark and Triumph and a prospectus of the Company (the “Joint Proxy Statement/Prospectus”), and the Company may file with the SEC other relevant documents concerning the Proposed Transactions. The definitive Joint Proxy Statement/Prospectus will be mailed to shareholders of Landmark and Triumph. SHAREHOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT AND THE JOINT PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTIONS CAREFULLY AND IN ITS ENTIRETY AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BY THE COMPANY, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTIONS.

Free copies of the Joint Proxy Statement/Prospectus, as well as other filings containing information about the Company, may be obtained at the SEC’s Internet site (http://www.sec.gov), when they are filed by the Company. You will also be able to obtain these documents, when they are filed, free of charge, from the Company at simmonsbank.com under the heading “Investor Relations.” Copies of the Joint Proxy Statement/Prospectus can also be obtained, free of charge, by directing a request to Simmons First National Corporation, 501 Main Street, Pine Bluff, Arkansas 71601, Attention: Ed Bilek, Director of Investor Relations, Email: ed.bilek@simmonsbank.com or ir@simmonsbank.com, Telephone: (870) 541-1000, to Triumph Bancshares, Inc., 5699 Poplar Avenue, Memphis, TN 38119, Attention: Will Chase, President, Telephone: (901) 333-8800, or to Landmark Community Bank, 1015 West Poplar Avenue, Collierville, TN 38017, Attention: Jake Farrell, Chairman, Telephone: (901) 850-0555.

Participants in the Solicitation
The Company, Landmark, Triumph and certain of their directors, executive officers and employees may be deemed to be participants in the solicitation of proxies from the shareholders of Landmark or Triumph in connection with the Proposed Transactions. Information about the Company’s directors and executive officers is available in its proxy statement for its 2021 annual meeting of shareholders, which was filed with the SEC on April 15, 2021. Information regarding all of the persons who may, under the rules of the SEC, be deemed participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, are contained in the Joint Proxy Statement/Prospectus regarding the Proposed Transactions and other relevant materials to be filed with the SEC when they become available. Free copies of these documents may be obtained as described in the preceding paragraph.

FOR MORE INFORMATION CONTACT:
Ed Bilek
EVP, Director of Investor Relations
Simmons First National Corporation
ed.bilek@simmonsbank.com


Simmons First National Corporation

SFNC

Consolidated End of Period Balance Sheets

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands)

ASSETS

Cash and non-interest bearing balances due from banks

$

215,381

$

227,713

$

217,499

$

382,691

$

234,998

Interest bearing balances due from banks and federal funds sold

2,123,743

3,677,750

3,254,653

2,139,440

2,310,162

Cash and cash equivalents

2,339,124

3,905,463

3,472,152

2,522,131

2,545,160

Interest bearing balances due from banks - time

1,335

1,334

1,579

4,061

4,561

Investment securities - held-to-maturity

931,352

609,500

333,031

47,102

51,720

Investment securities - available-for-sale

6,556,581

4,528,348

3,473,598

2,607,288

2,496,896

Mortgage loans held for sale

36,011

63,655

137,378

192,729

120,034

Other assets held for sale

100

100

100

389

399

Loans:

Loans

11,386,352

12,195,873

12,900,897

14,017,442

14,606,900

Allowance for credit losses on loans

(227,239

)

(235,116

)

(238,050

)

(248,251

)

(231,643

)

Net loans

11,159,113

11,960,757

12,662,847

13,769,191

14,375,257

Premises and equipment

429,587

427,540

441,692

470,491

478,896

Premises held for sale

6,090

13,613

15,008

4,486

4,576

Foreclosed assets and other real estate owned

15,239

11,168

18,393

12,590

14,111

Interest receivable

67,916

71,359

72,597

77,352

79,772

Bank owned life insurance

419,198

257,152

255,630

257,718

256,643

Goodwill

1,075,305

1,075,305

1,075,305

1,075,305

1,064,765

Other intangible assets

103,759

107,091

111,110

114,460

117,823

Other assets

282,449

315,732

289,332

282,102

293,071

Total assets

$

23,423,159

$

23,348,117

$

22,359,752

$

21,437,395

$

21,903,684

LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits:

Non-interest bearing transaction accounts

$

4,893,959

$

4,884,667

$

4,482,091

$

4,451,385

$

4,608,098

Interest bearing transaction accounts and savings deposits

10,569,602

10,279,997

9,672,608

8,993,255

8,978,045

Time deposits

2,841,052

3,024,724

2,832,327

2,802,007

3,029,975

Total deposits

18,304,613

18,189,388

16,987,026

16,246,647

16,616,118

Federal funds purchased and securities sold

under agreements to repurchase

187,215

323,053

299,111

313,694

387,025

Other borrowings

1,339,193

1,340,467

1,342,067

1,342,769

1,393,689

Subordinated notes and debentures

383,143

383,008

382,874

382,739

382,604

Other liabilities held for sale

-

-

154,620

-

-

Accrued interest and other liabilities

169,629

181,426

217,398

209,305

219,545

Total liabilities

20,383,793

20,417,342

19,383,096

18,495,154

18,998,981

Stockholders' equity:

Preferred stock

767

767

767

767

767

Common stock

1,084

1,083

1,081

1,090

1,090

Surplus

2,021,128

2,017,188

2,014,076

2,032,372

2,029,383

Undivided profits

1,004,314

948,913

901,006

866,503

819,153

Accumulated other comprehensive income (loss):

Unrealized (depreciation) accretion on AFS securities

12,073

(37,176

)

59,726

41,509

54,310

Total stockholders' equity

3,039,366

2,930,775

2,976,656

2,942,241

2,904,703

Total liabilities and stockholders' equity

$

23,423,159

$

23,348,117

$

22,359,752

$

21,437,395

$

21,903,684


Simmons First National Corporation

SFNC

Consolidated Statements of Income - Quarter-to-Date

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands, except per share data)

INTEREST INCOME

Loans (including fees)

$

138,804

$

146,424

$

160,115

$

163,180

$

176,910

Interest bearing balances due from banks and federal funds sold

651

798

716

623

603

Investment securities

27,128

21,573

17,207

14,910

13,473

Mortgage loans held for sale

386

639

1,070

1,012

668

TOTAL INTEREST INCOME

166,969

169,434

179,108

179,725

191,654

INTEREST EXPENSE

Time deposits

6,061

7,091

7,835

9,437

10,803

Other deposits

4,721

6,088

6,536

6,769

7,203

Federal funds purchased and securities

sold under agreements to repurchase

192

245

284

335

337

Other borrowings

4,897

4,802

4,869

4,943

4,963

Subordinated notes and debentures

4,565

4,527

4,624

4,631

4,667

TOTAL INTEREST EXPENSE

20,436

22,753

24,148

26,115

27,973

NET INTEREST INCOME

146,533

146,681

154,960

153,610

163,681

Provision for credit losses

(12,951

)

1,445

6,943

22,981

21,915

NET INTEREST INCOME AFTER PROVISION

FOR CREDIT LOSSES

159,484

145,236

148,017

130,629

141,766

NON-INTEREST INCOME

Trust income

7,238

6,666

6,557

6,744

7,253

Service charges on deposit accounts

10,050

9,715

10,799

10,385

8,570

Other service charges and fees

2,048

1,922

1,783

1,764

1,489

Mortgage lending income

4,490

6,447

2,993

13,971

12,459

SBA lending income

287

240

484

304

245

Investment banking income

654

695

676

557

571

Debit and credit card fees

7,882

7,401

7,203

7,217

6,575

Bank owned life insurance income

2,038

1,523

1,481

1,591

1,445

Gain on sale of securities, net

5,127

5,471

16

22,305

390

Other income

8,110

10,260

10,557

5,380

9,809

TOTAL NON-INTEREST INCOME

47,924

50,340

42,549

70,218

48,806

NON-INTEREST EXPENSE

Salaries and employee benefits

60,261

60,340

55,762

61,144

57,644

Occupancy expense, net

9,103

9,300

9,182

9,647

9,217

Furniture and equipment expense

4,859

5,415

5,940

6,231

6,144

Other real estate and foreclosure expense

863

343

551

602

274

Deposit insurance

1,687

1,308

1,627

2,244

2,838

Merger-related costs

686

233

731

902

1,830

Other operating expenses

38,007

36,854

52,835

36,546

38,230

TOTAL NON-INTEREST EXPENSE

115,466

113,793

126,628

117,316

116,177

NET INCOME BEFORE INCOME TAXES

91,942

81,783

63,938

83,531

74,395

Provision for income taxes

17,018

14,363

10,970

17,633

15,593

NET INCOME

74,924

67,420

52,968

65,898

58,802

Preferred stock dividends

13

13

13

13

13

NET INCOME AVAILABLE TO COMMON STOCKHOLDERS

$

74,911

$

67,407

$

52,955

$

65,885

$

58,789

BASIC EARNINGS PER SHARE

$

0.69

$

0.62

$

0.49

$

0.60

$

0.54

DILUTED EARNINGS PER SHARE

$

0.69

$

0.62

$

0.49

$

0.60

$

0.54


Simmons First National Corporation

SFNC

Consolidated Risk-Based Capital

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands)

Tier 1 capital

Stockholders' equity

$

3,039,366

$

2,930,775

$

2,976,656

$

2,942,241

$

2,904,703

CECL transition provision (1)

128,933

131,637

131,430

134,798

130,480

Disallowed intangible assets, net of deferred tax

(1,156,203

)

(1,159,720

)

(1,163,797

)

(1,167,357

)

(1,160,385

)

Unrealized loss (gain) on AFS securities

(12,073

)

37,176

(59,726

)

(41,509

)

(54,310

)

Total Tier 1 capital

2,000,023

1,939,868

1,884,563

1,868,173

Tier 2 capital

Trust preferred securities and subordinated debt

383,143

383,008

382,874

382,739

382,604

Qualifying allowance for loan losses and

reserve for unfunded commitments

79,138

87,251

89,546

96,734

83,780

Total Tier 2 capital

462,281

470,259

472,420

479,473

466,384

Total risk-based capital

$

2,462,304

$

2,410,127

$

2,356,983

$

2,347,646

$

2,286,872

Risk weighted assets

$

14,076,975

$

13,771,244

$

14,048,608

$

14,878,932

$

15,362,175

Adjusted average assets for leverage ratio

$

22,244,118

$

21,668,406

$

20,765,127

$

20,652,454

$

20,742,824

Ratios at end of quarter

Equity to assets

12.98

%

12.55

%

13.31

%

13.72

%

13.26

%

Tangible common equity to tangible assets (2)

8.36

%

7.88

%

8.45

%

8.65

%

8.31

%

Common equity Tier 1 ratio (CET1)

14.20

%

14.08

%

13.41

%

12.55

%

11.85

%

Tier 1 leverage ratio

8.99

%

8.95

%

9.08

%

9.05

%

8.78

%

Tier 1 risk-based capital ratio

14.21

%

14.09

%

13.41

%

12.56

%

11.85

%

Total risk-based capital ratio

17.49

%

17.50

%

16.78

%

15.78

%

14.89

%

(1) The Company has elected to use the CECL transition provision allowed for in the year of adopting ASC 326.

(2) Calculations of tangible common equity to tangible assets and the reconciliations to GAAP are included in the schedules accompanying this release.


Simmons First National Corporation

SFNC

Consolidated Investment Securities

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands)

Investment Securities - End of Period

Held-to-Maturity

U.S. Government agencies

$

77,396

$

77,396

$

-

$

-

$

-

Mortgage-backed securities

60,649

47,988

22,354

24,297

25,980

State and political subdivisions

793,307

484,116

310,109

21,930

24,777

Other securities

-

-

568

875

963

Total held-to-maturity (net of credit losses)

931,352

609,500

333,031

47,102

51,720

Available-for-Sale

U.S. Treasury

$

600

$

600

$

-

$

-

$

-

U.S. Government agencies

554,937

487,679

477,237

471,973

210,921

Mortgage-backed securities

3,987,209

2,133,086

1,394,936

903,687

1,154,086

State and political subdivisions

1,557,497

1,571,910

1,470,723

1,133,006

1,054,068

Other securities

456,338

335,073

130,702

98,622

77,821

Total available-for-sale (net of credit losses)

6,556,581

4,528,348

3,473,598

2,607,288

2,496,896

Total investment securities (net of credit losses)

$

7,487,933

$

5,137,848

$

3,806,629

$

2,654,390

$

2,548,616

Fair value - HTM investment securities

$

935,596

$

597,694

$

341,925

$

49,064

$

53,751

Investment Securities - QTD Average

Taxable securities

$

4,265,545

$

2,471,291

$

1,757,234

$

1,534,742

$

1,642,083

Tax exempt securities

2,157,076

1,919,919

1,528,127

1,155,099

866,944

Total investment securities - QTD average

$

6,422,621

$

4,391,210

$

3,285,361

$

2,689,841

$

2,509,027


Simmons First National Corporation

SFNC

Consolidated Loans

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands)

Loan Portfolio - End of Period

Consumer

Credit cards

$

177,634

$

175,458

$

188,845

$

180,848

$

184,348

Other consumer

181,712

172,965

202,379

182,768

214,024

Total consumer

359,346

348,423

391,224

363,616

398,372

Real Estate

Construction

1,428,165

1,451,841

1,596,255

1,853,360

2,010,256

Single-family residential

1,608,028

1,730,056

1,880,673

1,997,070

2,207,087

Other commercial real estate

5,332,655

5,638,010

5,746,863

6,132,823

6,316,444

Total real estate

8,368,848

8,819,907

9,223,791

9,983,253

10,533,787

Commercial

Commercial

2,074,729

2,444,700

2,574,386

2,907,798

3,038,216

Agricultural

193,462

155,921

175,905

241,687

217,715

Total commercial

2,268,191

2,600,621

2,750,291

3,149,485

3,255,931

Other

389,967

426,922

535,591

521,088

418,810

Total Loans

$

11,386,352

$

12,195,873

$

12,900,897

$

14,017,442

$

14,606,900


Simmons First National Corporation

SFNC

Consolidated Allowance and Asset Quality

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands)

Allowance for Credit Losses on Loans

Beginning balance, after adoption of ASC 326

$

235,116

$

238,050

$

248,251

$

231,641

$

243,195

Loans charged off

Credit cards

1,046

1,003

787

832

1,053

Other consumer

411

702

960

1,091

592

Real estate

439

1,687

10,415

1,153

1,824

Commercial

309

859

8,199

4,327

35,687

Total loans charged off

2,205

4,251

20,361

7,403

39,156

Recoveries of loans previously charged off

Credit cards

244

290

241

276

272

Other consumer

425

304

355

366

301

Real estate

1,523

403

431

120

253

Commercial

2,147

320

1,835

936

98

Total recoveries

4,339

1,317

2,862

1,698

924

Net loans charged off

(2,134

)

2,934

17,499

5,705

38,232

Provision for credit losses on loans

(10,011

)

-

7,298

22,315

26,678

Balance, end of quarter

$

227,239

$

235,116

$

238,050

$

248,251

$

231,641

Non-performing assets

Non-performing loans

Nonaccrual loans

$

80,282

$

114,856

$

122,879

$

167,713

$

131,383

Loans past due 90 days or more

653

635

578

174

494

Total non-performing loans

80,935

115,491

123,457

167,887

131,877

Other non-performing assets

Foreclosed assets and other real estate owned

15,239

11,168

18,393

12,590

14,111

Other non-performing assets

1,062

1,229

2,016

1,983

2,008

Total other non-performing assets

16,301

12,397

20,409

14,573

16,119

Total non-performing assets

$

97,236

$

127,888

$

143,866

$

182,460

$

147,996

Performing TDRs (troubled debt restructurings)

$

4,436

$

3,805

$

3,138

$

3,379

$

3,960

Ratios

Allowance for credit losses on loans to total loans

2.00

%

1.93

%

1.85

%

1.77

%

1.59

%

Allowance for credit losses to non-performing loans

281

%

204

%

193

%

148

%

176

%

Non-performing loans to total loans

0.71

%

0.95

%

0.96

%

1.20

%

0.90

%

Non-performing assets (including performing TDRs)

to total assets

0.43

%

0.56

%

0.66

%

0.87

%

0.69

%

Non-performing assets to total assets

0.42

%

0.55

%

0.64

%

0.85

%

0.68

%

Annualized net charge offs to total loans

-0.07

%

0.10

%

0.52

%

0.16

%

1.04

%

Annualized net credit card charge offs to

total credit card loans

1.78

%

1.39

%

1.15

%

1.20

%

1.67

%


Simmons First National Corporation

SFNC

Consolidated - Average Balance Sheet and Net Interest Income Analysis

For the Quarters Ended

(Unaudited)

Three Months Ended
Jun 2021

Three Months Ended
Mar 2021

Three Months Ended
Jun 2020

($ in thousands)

Average
Balance

Income/
Expense

Yield/
Rate

Average
Balance

Income/
Expense

Yield/
Rate

Average
Balance

Income/
Expense

Yield/
Rate

ASSETS

Earning assets:

Interest bearing balances due from banks

and federal funds sold

$

2,703,920

$

651

0.10%

$

3,477,989

$

798

0.09%

$

2,190,878

$

603

0.11%

Investment securities - taxable

4,265,545

14,594

1.37%

2,471,291

10,120

1.66%

1,642,083

7,131

1.75%

Investment securities - non-taxable (FTE)

2,157,076

16,899

3.14%

1,919,919

15,439

3.26%

866,944

8,434

3.91%

Mortgage loans held for sale

49,262

386

3.14%

97,409

639

2.66%

86,264

668

3.11%

Loans - including fees (FTE)

11,783,839

138,987

4.73%

12,518,300

146,601

4.75%

14,731,306

177,168

4.84%

Total interest earning assets (FTE)

20,959,642

171,517

3.28%

20,484,908

173,597

3.44%

19,517,475

194,004

4.00%

Non-earning assets

2,298,279

2,253,913

2,304,798

Total assets

$

23,257,921

$

22,738,821

$

21,822,273

LIABILITIES AND STOCKHOLDERS' EQUITY

Interest bearing liabilities:

Interest bearing transaction and

savings accounts

$

10,403,932

$

4,721

0.18%

$

10,093,868

$

6,088

0.24%

$

9,138,563

$

7,203

0.32%

Time deposits

2,930,025

6,061

0.83%

3,043,000

7,091

0.95%

3,057,153

10,803

1.42%

Total interest bearing deposits

13,333,957

10,782

0.32%

13,136,868

13,179

0.41%

12,195,716

18,006

0.59%

Federal funds purchased and securities

sold under agreement to repurchase

240,876

192

0.32%

307,540

245

0.32%

392,633

337

0.35%

Other borrowings

1,340,008

4,897

1.47%

1,341,059

4,802

1.45%

1,395,109

4,963

1.43%

Subordinated notes and debentures

383,078

4,565

4.78%

382,943

4,527

4.79%

387,422

4,667

4.84%

Total interest bearing liabilities

15,297,919

20,436

0.54%

15,168,410

22,753

0.61%

14,370,880

27,973

0.78%

Non-interest bearing liabilities:

Non-interest bearing deposits

4,826,927

4,419,136

4,354,781

Other liabilities

151,699

177,819

216,508

Total liabilities

20,276,545

19,765,365

18,942,169

Stockholders' equity

2,981,376

2,973,456

2,880,104

Total liabilities and stockholders' equity

$

23,257,921

$

22,738,821

$

21,822,273

Net interest income (FTE)

$

151,081

$

150,844

$

166,031

Net interest spread (FTE)

2.74%

2.83%

3.22%

Net interest margin (FTE) - quarter-to-date

2.89%

2.99%

3.42%

Net interest margin (FTE) - year-to-date

2.94%

2.99%

3.55%

Core net interest margin (FTE) - quarter-to-date (1)

2.78%

2.86%

3.18%

Core loan yield (FTE) - quarter-to-date (1)

4.54%

4.53%

4.52%

Core net interest margin (FTE) - year-to-date (1)

2.82%

2.86%

3.30%

Core loan yield (FTE) - year-to-date (1)

4.54%

4.53%

4.69%

(1) Calculations of core net interest margin and core loan yield and the reconciliations to GAAP are included in the schedules accompanying this release.


Simmons First National Corporation

SFNC

Consolidated - Selected Financial Data

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands, except share data)

QUARTER-TO-DATE

Financial Highlights - GAAP

Net Income

$

74,911

$

67,407

$

52,955

$

65,885

$

58,789

Diluted earnings per share

0.69

0.62

0.49

0.60

0.54

Return on average assets

1.29

%

1.20

%

0.96

%

1.20

%

1.08

%

Return on average common equity

10.08

%

9.20

%

7.13

%

8.91

%

8.21

%

Return on tangible common equity

17.25

%

15.85

%

12.48

%

15.45

%

14.55

%

Net interest margin (FTE)

2.89

%

2.99

%

3.22

%

3.21

%

3.42

%

FTE adjustment

4,548

4,163

3,482

2,864

2,350

Amortization of intangibles

3,333

3,344

3,351

3,362

3,369

Amortization of intangibles, net of taxes

2,462

2,470

2,475

2,483

2,489

Average diluted shares outstanding

108,822,175

108,655,293

108,888,264

109,207,294

109,130,866

Shares repurchased under plan

-

130,916

1,034,364

-

-

Average price of shares repurchased

-

23.53

19.36

-

-

Cash dividends declared per common share

0.18

0.18

0.17

0.17

0.17

Financial Highlights - Core (non-GAAP)

Core earnings (excludes non-core items) (1)

$

75,435

$

63,995

$

61,977

$

68,338

$

60,147

Core diluted earnings per share (1)

0.69

0.59

0.57

0.63

0.55

Core net interest margin (FTE) (2)

2.78

%

2.86

%

3.04

%

3.02

%

3.18

%

Accretable yield on acquired loans

5,619

6,630

8,999

8,948

11,723

Efficiency ratio (1)

56.93

%

57.43

%

54.93

%

53.75

%

51.13

%

Core return on average assets (1)

1.30

%

1.14

%

1.13

%

1.25

%

1.11

%

Core return on average common equity (1)

10.15

%

8.73

%

8.34

%

9.24

%

8.40

%

Core return on tangible common equity (1)

17.36

%

15.08

%

14.51

%

16.00

%

14.87

%

YEAR-TO-DATE

Financial Highlights - GAAP

Net Income

$

142,318

$

67,407

$

254,852

$

201,897

$

136,012

Diluted earnings per share

1.31

0.62

2.31

1.83

1.22

Return on average assets

1.25

%

1.20

%

1.18

%

1.25

%

1.28

%

Return on average common equity

9.64

%

9.20

%

8.72

%

9.27

%

9.45

%

Return on tangible common equity

16.56

%

15.85

%

15.25

%

16.19

%

16.57

%

Net interest margin (FTE)

2.94

%

2.99

%

3.38

%

3.43

%

3.55

%

FTE adjustment

4,548

4,163

11,001

7,519

4,655

Amortization of intangibles

6,677

3,344

13,495

10,144

6,782

Amortization of intangibles, net of taxes

4,932

2,470

9,968

7,493

5,010

Average diluted shares outstanding

108,746,439

108,655,293

110,173,661

110,480,508

111,083,999

Cash dividends declared per common share

0.18

0.18

0.68

0.51

0.34

Financial Highlights - Core (non-GAAP)

Core earnings (excludes non-core items) (1)

$

139,430

$

63,995

$

264,300

$

202,323

$

133,985

Core diluted earnings per share (1)

1.28

0.59

2.40

1.83

1.21

Core net interest margin (FTE) (2)

2.82

%

2.86

%

3.16

%

3.20

%

3.30

%

Accretable yield on acquired loans

12,249

6,630

41,507

32,508

23,560

Efficiency ratio (1)

57.18

%

57.43

%

54.33

%

54.14

%

54.33

%

Core return on average assets (1)

1.22

%

1.14

%

1.22

%

1.26

%

1.26

%

Core return on average common equity (1)

9.45

%

8.73

%

9.05

%

9.29

%

9.31

%

Core return on tangible common equity (1)

16.23

%

15.08

%

15.79

%

16.22

%

16.33

%

END OF PERIOD

Book value per share

$

28.03

$

27.04

$

27.53

$

26.98

$

26.64

Tangible book value per share

17.16

16.13

16.56

16.07

15.79

Shares outstanding

108,386,669

108,345,732

108,077,662

109,023,781

108,994,389

Full-time equivalent employees

2,783

2,817

2,827

2,840

2,906

Total number of financial centers

198

198

204

226

226

(1) Core earnings exclude non-core items, which is a non-GAAP measurement. Reconciliations to GAAP are included in the schedules accompanying this release.

(2) Excludes accretable yield adjustment on loans, which is a non-GAAP measurement. Reconciliations to GAAP are included in the schedules accompanying this release.


Simmons First National Corporation

SFNC

Reconciliation Of Non-GAAP Financial Measures - Core Earnings - Quarter-to-Date

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands, except per share data)

QUARTER-TO-DATE

Net Income

$

74,911

$

67,407

$

52,955

$

65,885

$

58,789

Non-core items

Gain on sale of branches

(445

)

(5,477

)

(275

)

-

(2,204

)

Merger-related costs

686

233

731

902

1,830

Early retirement program

-

-

62

2,346

493

Branch right-sizing (net)

468

625

11,696

72

1,721

Tax effect (1)

(185

)

1,207

(3,192

)

(867

)

(482

)

Net non-core items

524

(3,412

)

9,022

2,453

1,358

Core earnings (non-GAAP)

$

75,435

$

63,995

$

61,977

$

68,338

$

60,147

Diluted earnings per share

$

0.69

$

0.62

$

0.49

$

0.60

$

0.54

Non-core items

Gain on sale of branches

(0.01

)

(0.05

)

-

-

(0.02

)

Merger-related costs

0.01

-

-

0.01

0.02

Early retirement program

-

-

-

0.02

-

Branch right-sizing (net)

-

0.01

0.11

-

0.02

Tax effect (1)

-

0.01

(0.03

)

-

(0.01

)

Net non-core items

-

(0.03

)

0.08

0.03

0.01

Core diluted earnings per share (non-GAAP)

$

0.69

$

0.59

$

0.57

$

0.63

$

0.55

(1) Effective tax rate of 26.135%.

Reconciliation of Selected Non-Core Non-Interest Income and Expense Items (non-GAAP)

QUARTER-TO-DATE

Other income

$

8,110

$

10,260

$

10,557

$

5,380

$

9,809

Non-core items (1)

(445

)

(5,477

)

(275

)

(370

)

(2,204

)

Core other income (non-GAAP)

$

7,665

$

4,783

$

10,282

$

5,010

$

7,605

Non-interest expense

$

115,466

$

113,793

$

126,628

$

117,316

$

116,177

Non-core items (1)

(1,154

)

(858

)

(12,489

)

(3,690

)

(4,044

)

Core non-interest expense (non-GAAP)

$

114,312

$

112,935

$

114,139

$

113,626

$

112,133

Salaries and employee benefits

$

60,261

$

60,340

$

55,762

$

61,144

$

57,644

Non-core items (1)

-

-

(144

)

(2,448

)

(493

)

Core salaries and employee benefits (non-GAAP)

$

60,261

$

60,340

$

55,618

$

58,696

$

57,151

Merger related costs

$

686

$

233

$

731

$

902

$

1,830

Non-core items (1)

(686

)

(233

)

(731

)

(902

)

(1,830

)

Core merger related costs (non-GAAP)

$

-

$

-

$

-

$

-

$

-

Other operating expenses

$

38,007

$

36,854

$

52,835

$

36,546

$

38,230

Non-core items (1)

(89

)

(208

)

(10,270

)

(11

)

(1,662

)

Core other operating expenses (non-GAAP)

$

37,918

$

36,646

$

42,565

$

36,535

$

36,568

(1) Non-core items include gain on sale of branches, merger related costs, early retirement program expenses and branch right-sizing costs.


Simmons First National Corporation

SFNC

Reconciliation Of Non-GAAP Financial Measures - Core Earnings - Year-to-Date

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands, except per share data)

YEAR-TO-DATE

Net Income

$

142,318

$

67,407

$

254,852

$

201,897

$

136,012

Non-core items

Gain on sale of branches

(5,922

)

(5,477

)

(8,368

)

(8,093

)

(8,093

)

Merger-related costs

919

233

4,531

3,800

2,898

Early retirement program

-

-

2,901

2,839

493

Branch right-sizing (net)

1,093

625

13,727

2,031

1,959

Tax effect (1)

1,022

1,207

(3,343

)

(151

)

716

Net non-core items

(2,888

)

(3,412

)

9,448

426

(2,027

)

Core earnings (non-GAAP)

$

139,430

$

63,995

$

264,300

$

202,323

$

133,985

Diluted earnings per share

$

1.31

$

0.62

$

2.31

$

1.83

$

1.22

Non-core items

Gain on sale of branches

(0.06

)

(0.05

)

(0.07

)

(0.07

)

(0.07

)

Merger-related costs

0.01

-

0.04

0.03

0.03

Early retirement program

-

-

0.03

0.02

-

Branch right-sizing (net)

0.01

0.01

0.12

0.02

0.02

Tax effect (1)

0.01

0.01

(0.03

)

-

0.01

Net non-core items

(0.03

)

(0.03

)

0.09

-

(0.01

)

Core diluted earnings per share (non-GAAP)

$

1.28

$

0.59

$

2.40

$

1.83

$

1.21

(1) Effective tax rate of 26.135%.

Reconciliation of Selected Non-Core Non-Interest Income and Expense Items (non-GAAP)

YEAR-TO-DATE

Other income

$

18,370

$

10,260

$

38,547

$

27,990

$

22,610

Non-core items (1)

(5,922

)

(5,477

)

(8,738

)

(8,463

)

(8,093

)

Core other income (non-GAAP)

$

12,448

$

4,783

$

29,809

$

19,527

$

14,517

Non-interest expense

$

229,259

$

113,793

$

487,585

$

360,957

$

243,641

Non-core items (1)

(2,012

)

(858

)

(21,529

)

(9,040

)

(5,350

)

Core non-interest expense (non-GAAP)

$

227,247

$

112,935

$

466,056

$

351,917

$

238,291

Salaries and employee benefits

$

120,601

$

60,340

$

242,474

$

186,712

$

125,568

Non-core items (1)

-

-

(3,085

)

(2,941

)

(493

)

Core salaries and employee benefits (non-GAAP)

$

120,601

$

60,340

$

239,389

$

183,771

$

125,075

Merger related costs

$

919

$

233

$

4,531

$

3,800

$

2,898

Non-core items (1)

(919

)

(233

)

(4,531

)

(3,800

)

(2,898

)

Core merger related costs (non-GAAP)

$

-

$

-

$

-

$

-

$

-

Other operating expenses

$

74,861

$

36,854

$

168,050

$

115,215

$

78,669

Non-core items (1)

(297

)

(208

)

(12,155

)

(1,885

)

(1,874

)

Core other operating expenses (non-GAAP)

$

74,564

$

36,646

$

155,895

$

113,330

$

76,795

(1) Non-core items include gain on sale of branches, merger related costs, early retirement program expenses and branch right-sizing costs.


Simmons First National Corporation

SFNC

Reconciliation Of Non-GAAP Financial Measures - End of Period

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands, except per share data)

Calculation of Tangible Common Equity and the Ratio of Tangible Common Equity to Tangible Assets

Total common stockholders' equity

$

3,038,599

$

2,930,008

$

2,975,889

$

2,941,474

$

2,903,936

Intangible assets:

Goodwill

(1,075,305

)

(1,075,305

)

(1,075,305

)

(1,075,305

)

(1,064,765

)

Other intangible assets

(103,759

)

(107,091

)

(111,110

)

(114,460

)

(117,823

)

Total intangibles

(1,179,064

)

(1,182,396

)

(1,186,415

)

(1,189,765

)

(1,182,588

)

Tangible common stockholders' equity

$

1,859,535

$

1,747,612

$

1,789,474

$

1,751,709

$

1,721,348

Total assets

$

23,423,159

$

23,348,117

$

22,359,752

$

21,437,395

$

21,903,684

Intangible assets:

Goodwill

(1,075,305

)

(1,075,305

)

(1,075,305

)

(1,075,305

)

(1,064,765

)

Other intangible assets

(103,759

)

(107,091

)

(111,110

)

(114,460

)

(117,823

)

Total intangibles

(1,179,064

)

(1,182,396

)

(1,186,415

)

(1,189,765

)

(1,182,588

)

Tangible assets

$

22,244,095

$

22,165,721

$

21,173,337

$

20,247,630

$

20,721,096

Paycheck protection program ("PPP") loans

(441,353

)

(797,629

)

(904,673

)

(970,488

)

(963,712

)

Total assets excluding PPP loans

$

22,981,806

$

22,550,488

$

21,455,079

$

20,466,907

$

20,939,972

Tangible assets excluding PPP loans

$

21,802,742

$

21,368,092

$

20,268,664

$

19,277,142

$

19,757,384

Ratio of equity to assets

12.98

%

12.55

%

13.31

%

13.72

%

13.26

%

Ratio of equity to assets excluding PPP loans

13.23

%

13.00

%

13.87

%

14.38

%

13.87

%

Ratio of tangible common equity to tangible assets

8.36

%

7.88

%

8.45

%

8.65

%

8.31

%

Ratio of tangible common equity to tangible assets excluding PPP loans

8.53

%

8.18

%

8.83

%

9.09

%

8.71

%

Calculation of Tangible Book Value per Share

Total common stockholders' equity

$

3,038,599

$

2,930,008

$

2,975,889

$

2,941,474

$

2,903,936

Intangible assets:

Goodwill

(1,075,305

)

(1,075,305

)

(1,075,305

)

(1,075,305

)

(1,064,765

)

Other intangible assets

(103,759

)

(107,091

)

(111,110

)

(114,460

)

(117,823

)

Total intangibles

(1,179,064

)

(1,182,396

)

(1,186,415

)

(1,189,765

)

(1,182,588

)

Tangible common stockholders' equity

$

1,859,535

$

1,747,612

$

1,789,474

$

1,751,709

$

1,721,348

Shares of common stock outstanding

108,386,669

108,345,732

108,077,662

109,023,781

108,994,389

Book value per common share

$

28.03

$

27.04

$

27.53

$

26.98

$

26.64

Tangible book value per common share

$

17.16

$

16.13

$

16.56

$

16.07

$

15.79

Calculation of Regulatory Tier 1 Leverage Ratio Excluding Average PPP Loans

Total Tier 1 capital

$

2,000,023

$

1,939,868

$

1,884,563

$

1,868,173

$

1,820,488

Adjusted average assets for leverage ratio

$

22,244,118

$

21,668,406

$

20,765,127

$

20,652,454

$

20,742,824

Average PPP loans

(707,296

)

(891,070

)

(937,544

)

(967,152

)

(645,172

)

Adjusted average assets excluding average PPP loans

$

21,536,822

$

20,777,336

$

19,827,583

$

19,685,302

$

20,097,652

Tier 1 leverage ratio

8.99

%

8.95

%

9.08

%

9.05

%

8.78

%

Tier 1 leverage ratio excluding average PPP loans

9.29

%

9.34

%

9.50

%

9.49

%

9.06

%


Simmons First National Corporation

SFNC

Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date

For the Quarters Ended

Jun 30

Mar 31

Dec 31

Sep 30

Jun 30

(Unaudited)

2021

2021

2020

2020

2020

($ in thousands)

Calculation of Core Return on Average Assets

Net income

$

74,911

$

67,407

$

52,955

$

65,885

$

58,789

Net non-core items, net of taxes, adjustment

524

(3,412

)

9,022

2,453

1,358

Core earnings

$

75,435

$

63,995

$

61,977

$

68,338

$

60,147

Average total assets

$

23,257,921

$

22,738,821

$

21,852,094

$

21,765,321

$

21,822,273

Return on average assets

1.29

%

1.20

%

0.96

%

1.20

%

1.08

%

Core return on average assets

1.30

%

1.14

%

1.13

%

1.25

%

1.11

%

Calculation of Return on Tangible Common Equity

Net income

$

74,911

$

67,407

$

52,955

$

65,885

$

58,789

Amortization of intangibles, net of taxes

2,462

2,470

2,475

2,483

2,489

Total income available to common stockholders

$

77,373

$

69,877

$

55,430

$

68,368

$

61,278

Net non-core items, net of taxes

524

(3,412

)

9,022

2,453

1,358

Core earnings

75,435

63,995

61,977

68,338

60,147

Amortization of intangibles, net of taxes

2,462

2,470

2,475

2,483

2,489

Total core income available to common stockholders

$

77,897

$

66,465

$

64,452

$

70,821

$

62,636

Average common stockholders' equity

$

2,980,609

$

2,972,689

$

2,955,865

$

2,942,045

$

2,879,337

Average intangible assets:

Goodwill

(1,075,305

)

(1,075,305

)

(1,075,305

)

(1,064,893

)

(1,064,955

)

Other intangibles

(105,785

)

(109,850

)

(113,098

)

(116,385

)

(120,111

)

Total average intangibles

(1,181,090

)

(1,185,155

)

(1,188,403

)

(1,181,278

)

(1,185,066

)

Average tangible common stockholders' equity

$

1,799,519

$

1,787,534

$

1,767,462

$

1,760,767

$

1,694,271

Return on average common equity

10.08

%

9.20

%

7.13

%

8.91

%

8.21

%

Return on tangible common equity

17.25

%

15.85

%

12.48

%

15.45

%

14.55

%

Core return on average common equity

10.15

%

8.73

%

8.34

%

9.24

%

8.40

%

Core return on tangible common equity

17.36

%

15.08

%

14.51

%

16.00

%

14.87

%

Calculation of Efficiency Ratio (1)

Non-interest expense

$

115,466