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SmartFinancial Announces Results for the Second Quarter 2020

KNOXVILLE, Tenn., July 21, 2020 (GLOBE NEWSWIRE) -- SmartFinancial, Inc. ("SmartFinancial" or the "Company"; NASDAQ: SMBK), today announced net income of $6.2 million, or $0.41 per diluted common share, for the second quarter of 2020, compared to net income of $2.7 million, or $0.19 per diluted common share for the first quarter of 2020.  Operating earnings (Non-GAAP), which excludes securities gains, merger related and restructuring expenses and non-operating items, totaled $7.3 million, or $0.48 per diluted common share, in the second quarter of 2020, compared to $4.3 million, or $0.30 per diluted common share, in the first quarter of 2020.

Highlights   for the Second Quarter of 2020

  • Net income of $6.2 million and operating earnings of $7.3 million (Non-GAAP)
  • Diluted earnings per share increased 115.8% for the quarter and diluted operating earnings per share (Non-GAAP) increased 60.0% for the quarter
  • Total assets grew to over $3 billion
  • Completed the integration of Progressive Financial Group (PFG)
  • Tangible book value (Non-GAAP) per share of $16.90, a 6.6% year-over-year increase
  • Originated approximately 2,800 Paycheck Protection Program (PPP) loans totaling $292.8 million  

Billy Carroll, President & CEO, stated: "We are extremely pleased to report another very solid quarter.  While finalizing our Progressive Financial Group integration and conversion, we reported outstanding increases in revenue, in particular our non-interest income performance.  Our team also continues to focus on our tremendous asset quality and have worked with many new and existing clients to secure PPP funding, creating a number of great opportunities for our bank.  The outlook for our company remains very strong."

SmartFinancial's Chairman, Miller Welborn, concluded: We have closed another great quarter for our company. Our team has continued to successfully execute our Strategic Plan. We have strengthened our Balance Sheet, served our clients and our shareholders well and continued to increase the book value of our stock.

Net Interest Income and Net Interest Margin

Net interest income increased $3.1 million to $25.7 million for the second quarter of 2020, compared to $22.6 million for the first quarter of 2020, primarily attributable to the full quarter effects of the Companys March 1, 2020 acquisition of PFG (the PFG Acquisition) and participation in the PPP. Average earning assets increased $532.0 million, which reflects a $376.1 million increase in average loans, a $21.1 million increase in securities and a $134.8 million increase in other earning assets. Average interest-bearing liabilities increased $353.8 million, driven by an increase of $168.5 million in average interest-bearing deposits and an increase of $185.2 million in borrowings.

The tax equivalent net interest margin was 3.63% for the second quarter of 2020, compared to 3.90% for the first quarter of 2020. The tax equivalent net interest margin was impacted by a 61 basis point decline in the average yield on interest-earning assets offset by a 43 basis point decline in the rate on interest-bearing liabilities over the last quarter. The tax equivalent net interest margin, less discount accretion was 3.50% for the second quarter of 2020, a decrease from 3.58% for the first quarter of 2020.

The tax equivalent average yield on interest-earning assets was 4.22% for the second quarter of 2020, a decrease from 4.83% for the first quarter of 2020. The yield on average loans was 4.87% for the second quarter of 2020, compared to 5.35% for the first quarter of 2020. Offsetting the effects of the Federal Reserve rate cuts included in yield on average loans for the second quarter of 2020 was $1.9 million of PPP fee accretion and $888 thousand of discount accretion on acquired loans, compared to $1.8 million of discount accretion recognized in the first quarter of 2020. Additionally, increases in liquidity positions negatively impacted the net interest margin with lower yields earned on the excess cash position.

The yield on interest-bearing liabilities decreased to 0.77% for the second quarter of 2020 from 1.20% for the first quarter of 2020. The cost of average interest-bearing deposits was 0.71% for the second quarter of 2020 compared to 1.10% for the first quarter of 2020, a decrease of 39 basis points. This decrease was a result of the Companys efforts deployed to reduce deposit rates in reaction to the Federal Reserve rate cuts.

Provision for Loan Loss and Credit Quality

Provision for loan losses was $2.9 million in the second quarter of 2020, compared to $3.2 million in the first quarter of 2020.  At June 30, 2020, the allowance for loan losses was $16.3 million.  The allowance for loan losses to total loans was 0.67% as of June 30, 2020, compared to 0.63% as of March 31, 2020.  For the Companys originated loans, the allowance for loan losses to originated loans, less PPP loans, was 0.89% as of June 30, 2020, compared to 0.77% as of March 31, 2020.  The remaining discounts on the acquired loan portfolio totaled $16.2 million, or 3.40% of acquired loans as of June 30, 2020.  The elevated provision for loan losses was due to the continued economic conditions facing the U.S. economy related to the challenges being faced with the worldwide COVID-19 pandemic.

The Company is not required to implement the provisions of the CECL accounting standard until January 1, 2023, and is continuing to account for the allowance for loan losses under the incurred loss model.

Nonperforming loans as a percentage of total loans was 0.16% as of June 30, 2020, an increase of two basis points from the 0.14% reported in the first quarter of 2020.  Total nonperforming assets (which include nonaccrual loans, loans past due 90 days or more and still accruing, and other real estate owned) as a percentage of total assets was 0.28% as of June 30, 2020, as compared to 0.31% as of March 31, 2020. 

Noninterest Income

Noninterest income increased $693 thousand to $3.5 million for the second quarter of 2020 compared to $2.8 million for the first quarter of 2020.  During the second quarter of 2020, the primary components of the changes in noninterest income were as follows:

  • Increase in mortgage banking income of $347 thousand, as volume increased during the second quarter;
  • Increase in insurance commissions income of $204 thousand, due to a full quarter of revenue from the PFG Acquisition;
  • Increase in interchange and debit card transaction fees of $232 thousand, related to a full quarter of activity from the PFG Acquisition; and
  • Decrease in investment services income of $74 thousand.

Noninterest Expense

Noninterest expense was $18.8 million for the second and first quarters of 2020.  Even though noninterest expense remained constant between the second and first quarters of 2020, the primary changes within noninterest expense were as follows:

  • Salaries and employee benefits increased $351 thousand. The increase is attributable to the full quarter of salaries and benefits from the PFG Acquisition, annual salary increases, and other employee benefit accruals.  These increases were offset by deferred salary cost related to the origination of PPP loans; and
  • Decrease of $619 thousand in merger related and restructuring expenses relating to the PFG Acquisition.

Income Tax Expense

Income tax expense was $1.4 million for the second quarter of 2020, an increase of $763 thousand, compared to $664 thousand for the first quarter of 2020.

For the second quarter of 2020, the effective tax rate was 18.8% compared to 19.6% for the first quarter of 2020.

Balance Sheet Trends

Total assets at June 30, 2020, were $3.27 billion compared with $2.45 billion at December 31, 2019.  The increase of $816.9 million is primarily attributable to assets acquired from the PFG Acquisition of approximately $307.2 million, increase in cash and cash equivalents of $215.5 million and the origination of $292.8 million of PPP loans.

Total liabilities increased to $2.92 billion at June 30, 2020 from $2.14 billion at December 31, 2019.  The increase of $786.1 million was primarily from deposit growth of $220.5 million, acquired deposits from the PFG Acquisition in the amount of $272.0 million, and an increase in borrowings of $287.2 million.

Shareholders' equity at June 30, 2020, totaled $343.5 million, an increase of $30.7 million, from December 31, 2019.  The increase in shareholders' equity was primarily from the issuance of common stock for the acquisition of PFG of $24.5 million, net income of $8.9 million for the six months ended June 30, 2020 and a net change in accumulated other comprehensive income of $424 thousand, which was offset by the repurchase of the Company's common stock of $2.1 million and $1.5 million of dividends paid. Tangible book value per share (Non-GAAP) was $16.90 at June 30, 2020, an increase from $16.82 at December 31, 2019.  Tangible common equity (Non-GAAP) as a percentage of tangible assets (Non-GAAP) was 8.09% at June 30, 2020, compared with 9.93% at December 31, 2019.

Conference Call Information

SmartFinancial issued this earnings release for the second quarter of 2020 on Tuesday, July 21, 2020, and will host a conference call on Wednesday, July 22, 2020, at 10:00 a.m. ET.  To access this interactive teleconference, dial (888) 317-6003 or (412) 317-6061 and enter the confirmation number, 5925756.  A replay of the conference call will be available through July 22, 2021, by dialing (877) 344-7529 or (412) 317-0088 and entering the confirmation number, 10146072.  Conference call materials (earnings release & conference call presentation) will be published on the Companys webpage located at http://www.smartfinancialinc.com/CorporateProfile ), at 9:00 am ET prior to the conference call.

About SmartFinancial, Inc.

SmartFinancial, Inc., based in Knoxville, Tennessee, is the bank holding company for SmartBank. SmartBank is a full-service commercial bank founded in 2007, with 36 branches across East and Middle Tennessee, Alabama, and the Florida Panhandle.  Recruiting the best people, delivering exceptional client service, strategic branching, and a disciplined approach to lending have contributed to SmartBanks success. More information about SmartFinancial can be found on its website: www.smartfinancialinc.com.

Source  
SmartFinancial, Inc.  
   
Investor Contacts  
Billy Carroll Ron Gorczynski
President & CEO Executive Vice President, Chief Financial Officer
(865) 868-0613   billy.carroll@smartbank.com (865) 437-5724   ron.gorczynski@smartbank.com
   
Media Contact  
Kelley Fowler  
Senior Vice President, Public Relations & Marketing  
(865) 868-0611   kelley.fowler@smartbank.com  

Non-GAAP Financial Measures

Statements included in this earnings release include measures not recognized under U.S. generally accepted accounting principles (GAAP) and therefore are considered non-GAAP financial measures and should be read along with the accompanying tables, which provide a reconciliation of Non-GAAP financial measures to GAAP financial measures. SmartFinancial management uses several Non-GAAP financial measures, including: (i) operating earnings, (ii) operating return on average assets, (iii) operating pre-tax pre-provision return on average assets (iv) operating return on average shareholder' equity, (v) return on average tangible common equity, (vi) operating return on average tangible common equity, (vii) operating efficiency ratio, (viii) operating noninterest income, (ix) operating pre-tax pre-provision income (x) operating noninterest expense, (xi) tangible common equity, (xii) average tangible common equity, (xiii) tangible book value, (xiv) tax equivalent net interest margin, (xv) tax equivalent yield in earning assets; and ratios derived therefrom, in its analysis of the company's performance. Operating earnings excludes the following from net income: securities gains and losses, expenses related to the termination of an Alabama Department of Economic and Community Affairs (ADECA) loan program, merger termination fee of $6.4 million in the second quarter of 2019, merger related and restructuring expenses.  Operating return on average assets is the annualized operating earnings divided by average assets.  Operating pre-tax pre-provision return on average assets is the annualized operating pre-tax pre-provision income divided by average assets. Operating return on average shareholders' equity is the annualized operating earnings divided by average equity. Return on average tangible common equity is the annualized net income divided by average tangible common equity. Operating return on average tangible common equity is the annualized operating earnings divided by average tangible common equity (Non-GAAP). The operating efficiency ratio includes an adjustment for taxable equivalent yields and excludes securities gains and losses and merger related and restructuring expenses from the efficiency ratio. Operating noninterest income excludes the following from noninterest income: securities gains and losses, expenses related to the termination of the ADECA loan program and the merger termination fee of $6.4 million in the second quarter of 2019.  Operating pre-tax pre-provision income is net interest expense plus operating noninterest income less operating noninterest expense.  Operating noninterest expense excludes the following from noninterest expense: prior year adjustments to salaries, merger related and restructuring expenses and certain franchise tax true-up expenses. Tangible common equity and average tangible common equity excludes goodwill and other intangible assets from shareholders' equity and average shareholders' equity, respectively.  Tangible book value is tangible common equity divided by common shares outstanding.  Tax equivalent net interest margin is the annualized net interest income plus tax equivalent income divided by average interest earning assets. Tax equivalent yield in earning assets is the annualized interest income plus tax equivalent income divided by average interest earning assets. Management believes that Non-GAAP financial measures provide additional useful information that allows investors to evaluate the ongoing performance of the company and provide meaningful comparisons to its peers.  Management believes these non-GAAP financial measures also enhance investors' ability to compare period-to-period financial results and allow investors and company management to view our operating results excluding the impact of items that are not reflective of the underlying operating performance.  Non-GAAP financial measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider SmartFinancial's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the company. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the results or financial condition as reported under GAAP.

Forward-Looking Statements

This news release may contain statements that are based on managements current estimates or expectations of future events or future results, and that may be deemed to constitute forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995.  These statements, including statements regarding the potential effects of the COVID-19 pandemic on the Companys business and financial results and conditions, are not historical in nature and can generally be identified by such words as expect, anticipate, intend, plan, believe, seek, may, estimate, and similar expressions. All forward-looking statements are subject to risks, uncertainties, and other factors that may cause the actual results of SmartFinancial to differ materially from future results expressed or implied by such forward-looking statements. Such risks, uncertainties, and other factors include, among others, (1) risks associated with our growth strategy, including a failure to implement our growth plans or an inability to manage our growth effectively; (2) claims and litigation arising from our business activities and from the companies we acquire, which may relate to contractual issues, environmental laws, fiduciary responsibility, and other matters; (3) the risk that cost savings and revenue synergies from recently completed acquisitions may not be realized or may take longer than anticipated to realize; (4) disruption from recently completed acquisitions with customer, supplier, employee, or other business relationships; (6) our ability to successfully integrate the businesses acquired as part of previous acquisitions with the business of SmartBank; (6) risks related to the completed acquisition of PFG; (7) the risk that the anticipated benefits from the completed acquisition of PFG may not be realized in the time frame anticipated; (8) changes in managements plans for the future; (9) prevailing, or changes in, economic or political conditions, particularly in our market areas; (10) credit risk associated with our lending activities; (11) changes in interest rates, loan demand, real estate values, or competition; (12) changes in accounting principles, policies, or guidelines; (13) changes in applicable laws, rules, or regulations, including changes to statutes, regulations or regulatory policies or practices as a result of, or in response to COVID-19; (14) adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Companys participation in and execution of government programs related to the COVID-19 pandemic; (15) the impact of the COVID-19 pandemic on the Companys assets, business, cash flows, financial condition, liquidity, prospects and results of operations; (16) potential increases in the provision for loan losses resulting from the COVID-19 pandemic; and (17) other general competitive, economic, political, and market factors, including those affecting our business, operations, pricing, products, or services. These and other factors that could cause results to differ materially from those described in the forward-looking statements can be found in SmartFinancials most recent annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, in each case filed with or furnished to the Securities and Exchange Commission (the SEC) and available on the SECs website (www.sec.gov). Undue reliance should not be placed on forward-looking statements.  SmartFinancial disclaims any obligation to update or revise any forward-looking statements contained in this release, which speak only as of the date hereof, whether as a result of new information, future events, or otherwise.

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands except share and per share data)
           
  As of and for The     As of and for The  
  Three Months Ended     Six Months Ended  
  Jun   Mar   Dec   Sep   Jun     Jun   Jun  
  2020   2020   2019   2019   2019     2020   2019  
Selected Performance Ratios (Annualized):                                            
Return on average assets    0.79 %    0.43 %    1.12 %    1.01 %    1.56 %      0.63 %    1.21 %
Return on average shareholders' equity    7.31 %    3.33 %    8.65 %    7.80 %    12.34 %      5.41 %    9.59 %
Return on average tangible common equity¹    9.80 %    4.41 %    11.55 %    10.52 %    16.78 %      7.23 %    13.14 %
Noninterest income / average assets    0.45 %    0.44 %    0.47 %    0.37 %    1.44 %      0.45 %    0.88 %
Noninterest expense / average assets    2.41 %    2.96 %    2.68 %    2.48 %    2.88 %      2.66 %    2.82 %
Efficiency ratio    64.28 %    74.02 %    67.04 %    63.03 %    57.53 %      68.81 %    62.39 %
                                             
Operating Selected Performance Ratios (Annualized):                                            
Operating return on average assets 1    0.93 %    0.67 %    1.08 %    1.02 %    0.96 %      0.82 %    0.97 %
Operating PTPP return on average assets 1    1.53 %    1.37 %    1.31 %    1.47 %    1.33 %      1.46 %    1.38 %
Operating return on average shareholders' equity 1    8.58 %    5.22 %    8.34 %    7.87 %    7.58 %      7.00 %    7.69 %
Operating return on average tangible common equity 1    11.51 %    6.90 %    11.12 %    10.61 %    10.31 %      9.36 %    10.54 %
Operating efficiency ratio 1    58.95 %    65.46 %    64.95 %    62.42 %    65.56 %      61.98 %    64.91 %
Operating noninterest income / average assets 1    0.45 %    0.44 %    0.35 %    0.37 %    0.34 %      0.45 %    0.32 %
Operating noninterest expense / average assets 1    2.23 %    2.63 %    2.56 %    2.47 %    2.57 %      2.41 %    2.59 %
                                             
Selected Interest Rates and Yields:                                            
Yield on loans    4.87 %    5.35 %    5.36 %    5.48 %    5.53 %      5.09 %    5.58 %
Yield on earning assets, FTE    4.22 %    4.83 %    4.92 %    5.05 %    5.17 %      4.50 %    5.23 %
Cost of interest-bearing deposits    0.71 %    1.10 %    1.29 %    1.37 %    1.42 %      0.90 %    1.37 %
Cost of total deposits    0.54 %    0.91 %    1.06 %    1.13 %    1.18 %      0.71 %    1.14 %
Cost of interest-bearing liabilities    0.77 %    1.20 %    1.39 %    1.47 %    1.54 %      0.97 %    1.49 %
Net interest margin, FTE    3.63 %    3.90 %    3.84 %    3.91 %    3.94 %      3.75 %    4.04 %
                                             
Per Common Share:                                            
Net income, basic $  0.41   $  0.19   $  0.48   $  0.43   $  0.65     $  0.60   $  0.99  
Net income, diluted    0.41      0.19      0.48      0.42      0.65        0.60      0.99  
Operating earnings, basic¹    0.48      0.30      0.46      0.43      0.40        0.78      0.80  
Operating earnings, diluted¹    0.48      0.30      0.46      0.43      0.40        0.78      0.79  
Book value    22.57      22.09      22.33      21.93      21.47        22.57      21.47  
Tangible book value¹    16.90      16.40      16.82      16.37      15.86        16.90      15.86  
Common shares outstanding    15,216,932      15,221,990      14,008,233      13,957,973      13,953,209        15,216,932      13,953,209  

1 See reconciliation of Non-GAAP measures

 
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands)
                               
  As of and for The Three Months Ended  
  Jun   Mar   Dec   Sep   Jun  
  2020   2020   2019   2019   2019  
Composition of Loans:                              
Commercial real estate                              
owner occupied $  464,073   $  473,398   $  429,269   $  422,363   $  415,502  
non-owner occupied    552,958      535,637      476,038      468,099      464,160  
Commercial real estate, total    1,017,031      1,009,035      905,307      890,462      879,662  
Commercial & industrial    637,450      377,173      337,075      341,207      334,258  
Construction & land development    279,216      253,445      227,626      219,751      204,731  
Consumer real estate    459,861      482,728      417,481      402,463      402,270  
Consumer and other    14,726      16,866      9,903      10,796      11,981  
Total loans $  2,408,284   $  2,139,247   $  1,897,392   $  1,864,679   $  1,832,902  
                               
Asset Quality and Additional Loan Data:                              
Nonperforming loans $  3,776   $  3,069   $  3,350   $  3,166   $  2,838  
Other real estate owned    5,524      5,894      1,757      1,561      1,814  
Total nonperforming assets $  9,300   $  8,963   $  5,107   $  4,727   $  4,652  
Restructured loans not included in nonperforming loans $  9   $  9   $  61   $  61   $  62  
Net charge-offs to average loans (annualized)            0.01    0.01     %
Allowance for loan losses to loans    0.67    0.63    0.54    0.53    0.50 %
Nonperforming loans to total loans, gross    0.16    0.14    0.18    0.17    0.15 %
Nonperforming assets to total assets    0.28    0.31    0.21    0.20    0.19 %
Acquired loan fair value discount balance $  16,187   $  17,237   $  15,348   $  16,784   $  18,571  
Accretion income on acquired loans    888      1,841      1,375      1,246      1,374  
PPP net fees deferred balance    8,582                          
PPP net fees recognized    1,909                          
                               
Capital Ratios:                              
Equity to Assets    10.52    11.70    12.77    12.80    12.53 %
Tangible common equity to tangible assets (Non-GAAP) 1    8.09    8.96    9.93    9.88    9.57 %
                               
SmartFinancial, Inc. 2                              
Tier 1 leverage    8.83    10.28    10.34    10.02    9.92 %
Common equity Tier 1    10.92    10.87    11.61    11.54    11.21 %
Tier 1 capital    10.92    10.87    11.61    11.54    11.21 %
Total capital    13.25    13.13    14.02    13.98    13.65 %
                               
SmartBank   Estimated 3                          
Tier 1 leverage    9.82    11.42    11.41    11.22    10.92 %
Common equity Tier 1    12.14    12.05    12.81    12.71    12.37 %
Tier 1 risk-based capital    12.14    12.05    12.81    12.71    12.37 %
Total risk-based capital    12.82    12.62    13.31    13.19    12.82 %

1 Total common equity less intangibles divided by total assets less intangibles.  See reconciliation of Non-GAAP measures.
2 All periods presented are estimated.
3 Current period capital ratios are estimated as of the date of this earnings release.

 
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands)
                             
  Ending Balances
  Jun   Mar   Dec   Sep   Jun
  2020   2020   2019   2019   2019
Assets:                            
Cash and cash equivalents $  399,467     $  309,089     $  183,971     $  170,934     $  199,534  
Securities available-for-sale, at fair value    219,631        201,002        178,348        171,507        174,114  
Other investments    14,829        14,113        12,913        12,913        12,905  
Loans held for sale    6,330        6,045        5,856        3,068        4,087  
Loans    2,408,284        2,139,247        1,897,392        1,864,679        1,832,902  
Less: Allowance for loan losses    (16,254 )      (13,431 )      (10,243 )      (9,792 )      (9,097 )
Loans, net    2,392,030        2,125,816        1,887,149        1,854,887        1,823,805  
Premises and equipment, net    73,868        73,801        59,433        58,386        56,589  
Other real estate owned    5,524        5,894        1,757        1,561        1,814  
Goodwill and core deposit intangibles, net    86,327        86,503        77,193        77,534        78,348  
Bank owned life insurance    30,853        30,671        24,949        24,796        24,695  
Other assets    37,126        20,781        17,554        14,899        15,366  
Total assets $  3,265,985     $  2,873,715     $  2,449,123     $  2,390,485     $  2,391,257  
Liabilities:                            
Deposits:                            
Noninterest-bearing demand $  645,650     $  431,781     $  364,155     $  365,024     $  357,220  
Interest-bearing demand    479,212        444,141        380,234        351,474        333,705  
Money market and savings    762,246        730,392        623,284        634,934        648,132  
Time deposits    652,581        735,616        679,541        646,641        673,243  
Total deposits    2,539,689        2,341,930        2,047,214        1,998,073        2,012,300  
Borrowings    318,855        131,603        31,623        29,828        23,679  
Subordinated debt    39,304        39,283        39,261        39,240        39,219  
Other liabilities    24,649        24,699        18,278        17,304        16,448  
Total liabilities    2,922,497        2,537,515        2,136,376        2,084,445        2,091,646  
Shareholders' Equity:                            
Common stock    15,217        15,222        14,008        13,958        13,953  
Additional paid-in capital    254,396        254,356        232,732        232,573        232,386  
Retained earnings    73,283        67,869        65,839        59,806        53,843  
Accumulated other comprehensive income (loss)    592        (1,247 )      168        (297 )      (571 )
Total shareholders' equity    343,488        336,200        312,747        306,040        299,611  
Total liabilities & shareholders' equity $  3,265,985     $  2,873,715     $  2,449,123     $  2,390,485     $  2,391,257  


 
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands, except share and per share data)
                                           
  Three Months Ended     Six Months Ended
  Jun   Mar   Dec   Sep   Jun     Jun   Jun
  2020   2020   2019   2019   2019     2020   2019
Interest income:                                          
Loans, including fees $  28,663   $  26,434   $  25,398   $  25,515     $  25,278     $  55,097   $  50,253
Securities available-for-sale:                                          
Taxable    589      679      698      748        871        1,268      1,842
Tax-exempt    416      283      345      338        411        699      836
Federal funds sold and other earning assets    277      602      587      743        743        879      1,315
Total interest income    29,945      27,998      27,028      27,344        27,303        57,943      54,246
Interest expense:                                          
Deposits    3,366      4,754      5,271      5,605        5,788        8,120      11,039
Borrowings    249      89      70      15        123        339      235
Subordinated debt    584      584      584      584        590        1,167      1,173
Total interest expense    4,199      5,427      5,924      6,204        6,501        9,626      12,447
Net interest income    25,746      22,571      21,104      21,140        20,802        48,317      41,799
Provision for loan losses    2,850      3,200      685      724        393        6,049      1,190
Net interest income after provision for loan losses    22,896      19,371      20,419      20,416        20,409        42,268      40,609
Noninterest income:                                          
Service charges on deposit accounts    709      770      773      767        707        1,479      1,361
Gain on sale of securities, net    16                  1        33        16      33
Mortgage banking    931      584      374      518        392        1,515      674
Investment services    363      437      261      260        255        801      424
Insurance commissions    473      269                            742      
Interchange and debit card transaction fees    508      276      163      148        143        784      318
Merger termination fee                              6,400              6,400
Other    511      482      1,269      502        486        993      904
Total noninterest income    3,511      2,818      2,840      2,196        8,416        6,330      10,114
Noninterest expense:                                          
Salaries and employee benefits    10,357      10,006      10,278      9,072        8,984        20,363      17,382
Occupancy and equipment    1,996      1,911      1,749      1,635        1,658        3,906      3,298
FDIC insurance    180      180            (219 )      180        360      359
Other real estate and loan related expense    346      545      253      335        242        892      732
Advertising and marketing    202      198      166      263        259        400      554
Data processing    594      538      530      273        577        1,132      1,192
Professional services    868      711      652      573        489        1,578      1,151
Amortization of intangibles    405      362      340      341        342        767      686
Software as service contracts    561      470      500      560        568        1,031      1,136
Merger related and restructuring expenses    1,477      2,096      427      73        1,796        3,573      2,719
Other    1,820      1,776      1,157      1,802        1,714        3,598      3,179
Total noninterest expense    18,806      18,793      16,052      14,708        16,809        37,600      32,388
Income before income taxes    7,601      3,396      7,206      7,904        12,016        10,998      18,335
Income tax expense    1,427      664      473      1,941        2,895        2,091      4,483
Net income $  6,174   $  2,732   $  6,733   $  5,963     $  9,121     $  8,907   $  13,852
Earnings per common share:                                          
Basic $  0.41   $  0.19   $  0.48   $  0.43     $  0.65     $  0.60   $  0.99
Diluted $  0.41   $  0.19   $  0.48   $  0.42     $  0.65     $  0.60   $  0.99
Weighted average common shares outstanding:                                          
Basic    15,152,768      14,395,103      13,965,877      13,955,859        13,951,643        14,773,935      13,946,856
Diluted    15,202,335      14,479,679      14,066,269      14,053,432        14,046,500        14,842,486      14,036,790


...
 
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands)
YIELD ANALYSIS
                                                 
  Three Months Ended  
  June 30, 2020   March 31, 2020   June 30, 2019