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Triumph Bancorp Reports Third Quarter Net Income to Common Stockholders of $14.3 Million

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DALLAS, Oct. 16, 2019 (GLOBE NEWSWIRE) -- Triumph Bancorp, Inc. (TBK) (“Triumph” or the “Company”) today announced earnings and operating results for the third quarter of 2019.

As part of how we measure our results, we use certain non-GAAP financial measures to ascertain performance. These non-GAAP financial measures are reconciled in the section labeled “Metrics and non-GAAP financial reconciliation” at the end of this press release.

2019 Third Quarter Highlights and Recent Developments

  • For the third quarter of 2019, net income available to common stockholders was $14.3 million. Diluted earnings per share were $0.56.

  • Net interest margin (“NIM”) was 5.85% for the quarter ended September 30, 2019.

  • Total loans held for investment increased $373.5 million, or 9.7%, to $4.209 billion at September 30, 2019. Average loans for the quarter increased $235.7 million, or 6.4%, to $3.944 billion.

  • Triumph Business Capital grew period-end clients to 6,471 clients, which is an increase of 16 clients, or 0.2%. The total dollar value of invoices purchased for the quarter ended September 30, 2019 was $1.451 billion with an average invoice price of $1,628.

  • At September 30, 2019, there were 163 clients utilizing the TriumphPay platform, which is an increase of 17 clients, or 11.6%, during the quarter. For the quarter ended September 30, 2019, TriumphPay processed 168,562 invoices paying 30,333 distinct carriers a total of $190.3 million.

  • During the quarter ended September 30, 2019, we repurchased 850,093 shares into treasury stock under our stock repurchase program at an average price of $29.38, for a total of $25.0 million. During the nine months ended September 30, 2019, we have repurchased 1,688,234 shares into treasury stock under our stock repurchase programs at an average price of $29.56, for a total of $49.9 million, effectively completing both of our previously announced $25.0 million stock repurchase programs.

Repurchase Program Authorization

On October 16, 2019 our board of directors authorized us to repurchase up to an additional $50.0 million of our outstanding common stock. We may repurchase these shares from time to time in open market transactions or through privately negotiated transactions at our discretion. The amount, timing and nature of any share repurchases will be based on a variety of factors, including the trading price of our common stock, applicable securities laws restrictions, regulatory limitations and market and economic factors. This repurchase program is authorized for a period of up to one year and does not require us to repurchase any specific number of shares. The repurchase program may be modified, suspended or discontinued at any time, at our discretion.

Balance Sheet

Total loans held for investment increased $373.5 million, or 9.7%, during the third quarter to $4.209 billion at September 30, 2019. The commercial finance portfolio increased $89.0 million, or 7.5%, to $1.276 billion, the national lending portfolio increased $249.4 million, or 52.3%, to $726.6 million, and the community banking portfolio increased $35.1 million, or 1.6%, to $2.207 billion during the quarter.

Total deposits were $3.698 billion at September 30, 2019, an increase of $38.9 million, or 1.1%, in the third quarter of 2019. Non-interest-bearing deposits accounted for 20% of total deposits and non-time deposits accounted for 57% of total deposits at September 30, 2019.

Net Interest Income

We earned net interest income for the quarter ended September 30, 2019 of $64.8 million compared to $63.4 million for the quarter ended June 30, 2019.

Yields on loans for the quarter ended September 30, 2019 were down 32 bps from the prior quarter to 7.63%. The average cost of our total deposits was 1.19% for the quarter ended September 30, 2019 compared to 1.14% for the quarter ended June 30, 2019.

Asset Quality

Non-performing assets were 0.91% of total assets at September 30, 2019 compared to 0.86% of total assets at June 30, 2019. The ratio of past due to total loans increased to 2.47% at September 30, 2019 from 1.90% at June 30, 2019. We recorded total net charge-offs of $0.4 million, or 0.01% of average loans, for the quarter ended September 30, 2019 compared to net charge-offs of $1.9 million, or 0.05% of average loans, for the quarter ended June 30, 2019.

We recorded a provision for loan losses of $2.9 million for the quarter ended September 30, 2019 compared to a provision of $3.7 million for the quarter ended June 30, 2019. From June 30, 2019 to September 30, 2019, our ALLL increased from $29.4 million or 0.77% of total loans to $31.9 million or 0.76% of total loans.

Non-Interest Income and Expense

We earned non-interest income for the quarter ended September 30, 2019 of $7.7 million compared to $7.6 million for the quarter ended June 30, 2019.

For the quarter ended September 30, 2019, non-interest expense totaled $52.2 million, compared to $50.7 million for the quarter ended June 30, 2019.

Conference Call Information

Aaron P. Graft, Vice Chairman and CEO and Bryce Fowler, CFO will review the quarterly results in a conference call for investors and analysts beginning at 7:00 a.m. Central Time on Thursday, October 17, 2019. Todd Ritterbusch, Chief Lending Officer, will also be available for questions.

To participate in the live conference call, please dial 1-855-940-9472 (Canada:1-855-669-9657) and request to be joined into the Triumph Bancorp, Inc. call. A simultaneous audio-only webcast may be accessed via the Company's website at www.triumphbancorp.com through the Investor Relations, News & Events, Webcasts and Presentations links, or through a direct link here at: https://services.choruscall.com/links/tbk191017.html. An archive of this conference call will subsequently be available at this same location on the Company’s website.

About Triumph

Triumph Bancorp, Inc. (TBK) is a financial holding company headquartered in Dallas, Texas. Triumph offers a diversified line of community banking, national lending, and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com

Forward-Looking Statements

This press release contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; risks related to the integration of acquired businesses (including our acquisitions of First Bancorp of Durango, Inc., Southern Colorado Corp., and the operating assets of Interstate Capital Corporation and certain of its affiliates) and any future acquisitions; changes in management personnel; interest rate risk; concentration of our factoring services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets, or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally, or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities, and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of the Federal Deposit Insurance Corporation insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 12, 2019.

Non-GAAP Financial Measures

This press release includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided at the end of this press release.


The following table sets forth key metrics used by Triumph to monitor our operations. Footnotes in this table can be found in our definitions of non-GAAP financial measures at the end of this document.

As of and for the Three Months Ended

As of and for the Nine Months
Ended

September 30,

June 30,

March 31,

December 31,

September 30,

September 30,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

2019

2018

Financial Highlights:

Total assets

$

5,039,697

$

4,783,189

$

4,529,783

$

4,559,779

$

4,537,102

$

5,039,697

$

4,537,102

Loans held for investment

$

4,209,417

$

3,835,903

$

3,612,869

$

3,608,644

$

3,512,143

$

4,209,417

$

3,512,143

Deposits

$

3,697,833

$

3,658,978

$

3,314,440

$

3,450,349

$

3,439,049

$

3,697,833

$

3,439,049

Net income available to common stockholders

$

14,317

$

12,730

$

14,788

$

18,085

$

8,975

$

41,835

$

33,045

Performance Ratios - Annualized:

Return on average assets

1.17

%

1.09

%

1.33

%

1.60

%

0.90

%

1.20

%

1.21

%

Return on average total equity

8.79

%

7.83

%

9.30

%

11.35

%

5.88

%

8.63

%

8.40

%

Return on average common equity

8.79

%

7.83

%

9.30

%

11.40

%

5.85

%

8.63

%

8.41

%

Return on average tangible common equity (1)

12.56

%

11.19

%

13.43

%

16.73

%

7.57

%

12.38

%

10.27

%

Yield on loans(2)

7.63

%

7.95

%

7.99

%

8.14

%

8.33

%

7.85

%

8.05

%

Cost of interest bearing deposits

1.49

%

1.42

%

1.24

%

1.15

%

1.08

%

1.39

%

0.96

%

Cost of total deposits

1.19

%

1.14

%

0.99

%

0.91

%

0.85

%

1.11

%

0.76

%

Cost of total funds

1.41

%

1.40

%

1.28

%

1.14

%

1.16

%

1.36

%

1.06

%

Net interest margin(2)

5.85

%

5.99

%

6.15

%

6.34

%

6.59

%

5.99

%

6.35

%

Net non-interest expense to average assets

3.64

%

3.68

%

3.70

%

3.55

%

4.19

%

3.67

%

3.76

%

Adjusted net non-interest expense to average assets (1)

3.64

%

3.68

%

3.70

%

3.55

%

3.62

%

3.67

%

3.55

%

Efficiency ratio

71.93

%

71.37

%

70.54

%

65.52

%

72.15

%

71.29

%

67.50

%

Adjusted efficiency ratio (1)

71.93

%

71.37

%

70.54

%

65.52

%

63.49

%

71.29

%

63.98

%

Asset Quality:(3)

Past due to total loans

2.47

%

1.90

%

2.33

%

2.41

%

2.23

%

2.47

%

2.23

%

Non-performing loans to total loans

1.00

%

0.96

%

0.95

%

1.00

%

1.13

%

1.00

%

1.13

%

Non-performing assets to total assets

0.91

%

0.86

%

0.84

%

0.84

%

0.93

%

0.91

%

0.93

%

ALLL to non-performing loans

75.58

%

79.91

%

80.70

%

76.47

%

68.82

%

75.58

%

68.82

%

ALLL to total loans

0.76

%

0.77

%

0.76

%

0.76

%

0.78

%

0.76

%

0.78

%

Net charge-offs to average loans

0.01

%

0.05

%

0.03

%

0.05

%

0.12

%

0.09

%

0.19

%

Capital:

Tier 1 capital to average assets(4)

10.37

%

10.84

%

11.32

%

11.08

%

11.75

%

10.37

%

11.75

%

Tier 1 capital to risk-weighted assets(4)

10.08

%

11.08

%

11.76

%

11.49

%

11.16

%

10.08

%

11.16

%

Common equity tier 1 capital to risk-weighted assets(4)

9.26

%

10.19

%

10.81

%

10.55

%

9.96

%

9.26

%

9.96

%

Total capital to risk-weighted assets(4)

11.79

%

12.88

%

13.62

%

13.35

%

13.05

%

11.79

%

13.05

%

Total equity to total assets

12.57

%

13.45

%

14.27

%

13.96

%

13.59

%

12.57

%

13.59

%

Tangible common stockholders' equity to tangible assets(1)

9.10

%

9.78

%

10.37

%

10.03

%

9.35

%

9.10

%

9.35

%

Per Share Amounts:

Book value per share

$

24.99

$

24.56

$

24.19

$

23.62

$

23.10

$

24.99

$

23.10

Tangible book value per share (1)

$

17.40

$

17.13

$

16.82

$

16.22

$

15.42

$

17.40

$

15.42

Basic earnings per common share

$

0.56

$

0.48

$

0.55

$

0.68

$

0.34

$

1.60

$

1.37

Diluted earnings per common share

$

0.56

$

0.48

$

0.55

$

0.67

$

0.34

$

1.59

$

1.35

Adjusted diluted earnings per common share(1)

$

0.56

$

0.48

$

0.55

$

0.67

$

0.51

$

1.59

$

1.53

Shares outstanding end of period

25,357,985

26,198,308

26,709,411

26,949,936

26,279,761

25,357,985

26,279,761

Unaudited consolidated balance sheet as of:

September 30,

June 30,

March 31,

December 31,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

ASSETS

Total cash and cash equivalents

$

115,043

$

209,305

$

171,950

$

234,939

$

282,409

Securities - available for sale

302,917

329,991

339,465

336,423

355,981

Securities - held to maturity

8,517

8,573

8,499

8,487

8,403

Equity securities

5,543

5,479

5,183

5,044

4,981

Loans held for sale

7,499

2,877

610

2,106

683

Loans held for investment

4,209,417

3,835,903

3,612,869

3,608,644

3,512,143

Allowance for loan and lease losses

(31,895

)

(29,416

)

(27,605

)

(27,571

)

(27,256

)

Loans, net

4,177,522

3,806,487

3,585,264

3,581,073

3,484,887

FHLB and other restricted stock

23,960

18,037

21,191

15,943

23,109

Premises and equipment, net

87,112

84,998

84,931

83,392

82,935

Other real estate owned ("OREO"), net

2,849

3,351

3,073

2,060

2,442

Goodwill and intangible assets, net

192,440

194,668

197,015

199,417

201,842

Bank-owned life insurance

40,724

40,847

40,667

40,509

40,339

Deferred tax asset, net

5,971

7,278

7,608

8,438

8,137

Other assets

69,600

71,298

64,327

41,948

40,954

Total assets

$

5,039,697

$

4,783,189

$

4,529,783

$

4,559,779

$

4,537,102

LIABILITIES

Non-interest bearing deposits

$

754,233

$

684,223

$

667,597

$

724,527

$

697,903

Interest bearing deposits

2,943,600

2,974,755

2,646,843

2,725,822

2,741,146

Total deposits

3,697,833

3,658,978

3,314,440

3,450,349

3,439,049

Customer repurchase agreements

14,124

12,788

3,727

4,485

13,248

Federal Home Loan Bank advances

530,000

305,000

405,000

330,000

330,000

Subordinated notes

49,010

48,983

48,956

48,929

48,903

Junior subordinated debentures

39,443

39,320

39,200

39,083

38,966

Other liabilities

75,594

74,758

72,244

50,326

50,295

Total liabilities

4,406,004

4,139,827

3,883,567

3,923,172

3,920,461

EQUITY

Preferred stock series A

4,550

Preferred stock series B

5,108

Common stock

272

271

271

271

264

Additional paid-in-capital

472,368

471,145

470,292

469,341

458,920

Treasury stock, at cost

(52,632

)

(27,468

)

(9,881

)

(2,288

)

(2,285

)

Retained earnings

212,321

198,004

185,274

170,486

152,401

Accumulated other comprehensive income

1,364

1,410

260

(1,203

)

(2,317

)

Total equity

633,693

643,362

646,216

636,607

616,641

Total liabilities and equity

$

5,039,697

$

4,783,189

$

4,529,783

$

4,559,779

$

4,537,102

Unaudited consolidated statement of income:

For the Three Months Ended

For the Nine Months Ended

September 30,

June 30,

March 31,

December 31,

September 30,

September 30,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

2019

2018

Interest income:

Loans, including fees

$

50,249

$

47,910

$

45,094

$

44,435

$

41,257

$

143,253

$

116,288

Factored receivables, including fees

25,570

25,558

24,556

28,070

27,939

75,684

64,033

Securities

2,784

2,667

2,644

2,314

1,551

8,095

4,040

FHLB and other restricted stock

209

146

192

154

147

547

353

Cash deposits

603

1,022

778

877

865

2,403

2,412

Total interest income

79,415

77,303

73,264

75,850

71,759

229,982

187,126

Interest expense:

Deposits

11,036

10,010

8,218

7,931

6,219

29,264

15,127

Subordinated notes

840

839

839

839

837

2,518

2,512

Junior subordinated debentures

719

744

760

717

714

2,223

2,024

Other borrowings

2,055

2,291

2,136

1,482

2,207

6,482

5,294

Total interest expense

14,650

13,884

11,953

10,969

9,977

40,487

24,957

Net interest income

64,765

63,419

61,311

64,881

61,782

189,495

162,169

Provision for loan losses

2,865

3,681

1,014

1,910

6,803

7,560

14,257

Net interest income after provision for loan losses

61,900

59,738

60,297

62,971

54,979

181,935

147,912

Non-interest income:

Service charges on deposits

1,937

1,700

1,606

1,702

1,412

5,243

3,767

Card income

2,015

2,071

1,844

1,999

1,877

5,930

4,515

Net OREO gains (losses) and valuation adjustments

(56

)

148

209

37

65

301

(551

)

Net gains (losses) on sale of securities

19

14

(11

)

22

(272

)

Fee income

1,624

1,519

1,612

1,636

1,593

4,755

3,514

Insurance commissions

1,247

961

919

846

1,113

3,127

2,646

Gain on sale of subsidiary

1,071

Other

956

1,210

1,359

574

(1

)

3,525

1,486

Total non-interest income

7,742

7,623

7,538

6,794

6,059

22,903

16,176

Non-interest expense:

Salaries and employee benefits

28,717

28,120

26,439

25,586

24,695

83,276

64,626

Occupancy, furniture and equipment

4,505

4,502

4,522

4,402

3,553

13,529

9,621

FDIC insurance and other regulatory assessments

(2

)

303

299

184

363

600

945

Professional fees

1,969

1,550

1,865

1,837

3,384

5,384

7,102

Amortization of intangible assets

2,228

2,347

2,402

2,438

2,064

6,977

4,542

Advertising and promotion

1,379

1,796

1,604

1,036

1,609

4,779

3,938

Communications and technology

5,382

4,988

4,874

4,388

7,252

15,244

13,882

Other

7,975

7,098

6,561

7,091

6,026

21,634

15,735

Total non-interest expense

52,153

50,704

48,566

46,962

48,946

151,423

120,391

Net income before income tax

17,489

16,657

19,269

22,803

12,092

53,415

43,697

Income tax expense

3,172

3,927

4,481

4,718

2,922

11,580

10,074

Net income

$

14,317

$

12,730

$

14,788

$

18,085

$

9,170

$

41,835

$

33,623

Dividends on preferred stock

(195

)

(578

)

Net income available to common stockholders

$

14,317

$

12,730

$

14,788

$

18,085

$

8,975

$

41,835

$

33,045

Earnings per share:

For the Three Months Ended

For the Nine Months Ended

September 30,

June 30,

March 31,

December 31,

September 30,

September 30,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

2019

2018

Basic

Net income to common stockholders

$

14,317

$

12,730

$

14,788

$

18,085

$

8,975

$

41,835

$

33,045

Weighted average common shares outstanding

25,621,054

26,396,351

26,679,724

26,666,554

26,178,194

26,228,499

24,159,543

Basic earnings per common share

$

0.56

$

0.48

$

0.55

$

0.68

$

0.34

$

1.60

$

1.37

Diluted

Net income to common stockholders

$

14,317

$

12,730

$

14,788

$

18,085

$

8,975

$

41,835

$

33,045

Dilutive effect of preferred stock

195

578

Net income to common stockholders - diluted

$

14,317

$

12,730

$

14,788

$

18,085

$

9,170

$

41,835

$

33,623

Weighted average common shares outstanding

25,621,054

26,396,351

26,679,724

26,666,554

26,178,194

26,228,499

24,159,543

Dilutive effects of:

Assumed conversion of Preferred A

89,240

315,773

315,773

Assumed conversion of Preferred B

100,176

354,471

354,471

Assumed exercises of stock options

60,068

59,962

64,166

76,219

90,320

61,054

86,728

Restricted stock awards

45,631

30,110

49,795

46,457

45,796

40,572

55,087

Restricted stock units

3,045

1,303

7,276

57

2,706

Performance stock units

4,673

1,558

Weighted average shares outstanding - diluted

25,734,471

26,486,423

26,793,685

26,979,949

26,991,830

26,331,740

24,974,308

Diluted earnings per common share

$

0.56

$

0.48

$

0.55

$

0.67

$

0.34

$

1.59

$

1.35

Shares that were not considered in computing diluted earnings per common share because they were antidilutive are as follows:

For the Three Months Ended

For the Nine Months Ended

September 30,

June 30,

March 31,

December 31,

September 30,

September 30,

September 30,

2019

2019

2019

2018

2018

2019

2018

Assumed conversion of Preferred A

Assumed conversion of Preferred B

Stock options

67,023

70,037

50,752

51,952

51,952

67,023

51,952

Restricted stock awards

3,209

13,290

14,513

14,513

3,209

14,513

Restricted stock units

58,400

58,400

54,077

Performance stock units

55,228

70,879

58,400

59,658

59,658

55,228

59,658

Loans held for investment summarized as of:

September 30,

June 30,

March 31,

December 31,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

Commercial real estate

$

1,115,559

$

1,098,279

$

1,093,882

$

992,080

$

906,494

Construction, land development, land

164,186

157,861

145,002

179,591

190,920

1-4 family residential properties

186,405

186,070

194,067

190,185

194,752

Farmland

161,447

144,594

156,299

170,540

177,313

Commercial

1,369,505

1,257,330

1,117,640

1,114,971

1,123,598

Factored receivables

599,651

583,131

570,663

617,791

611,285

Consumer

24,967

26,048

27,941

29,822

31,423

Mortgage warehouse

587,697

382,590

307,375

313,664

276,358

Total loans

$

4,209,417

$

3,835,903

$

3,612,869

$

3,608,644

$

3,512,143

Our total loans held for investment portfolio consists of traditional community bank loans as well as commercial finance product lines focused on businesses that require specialized financial solutions and national lending product lines that further diversify our lending operations.

Commercial finance loans are further summarized below:

September 30,

June 30,

March 31,

December 31,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

Commercial - Equipment

$

429,412

$

395,094

$

364,447

$

352,037

$

323,832

Commercial - Asset-based lending

247,026

208,896

174,447

214,110

273,096

Factored receivables

599,651

583,131

570,663

617,791

611,285

Commercial finance

$

1,276,089

$

1,187,121

$

1,109,557

$

1,183,938

$

1,208,213

Commercial finance % of total loans

30

%

31

%

31

%

33

%

34

%

National lending loans are further summarized below:

September 30,

June 30,

March 31,

December 31,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

Mortgage warehouse

$

587,697

$

382,590

$

307,375

$

313,664

$

276,358

Commercial - Liquid credit

37,386

21,758

960

963

966

Commercial - Premium finance

101,562

72,898

77,389

72,302

75,293

National lending

$

726,645

$

477,246

$

385,724

$

386,929

$

352,617

National lending % of total loans

17

%

12

%

11

%

11

%

10

%

Additional information pertaining to our loan portfolio, summarized for the quarters ended:

September 30,

June 30,

March 31,

December 31,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

Average community banking

$

2,193,533

$

2,166,122

$

2,103,816

$

2,012,255

$

1,748,936

Average commercial finance

1,208,823

1,168,110

1,123,978

1,190,586

1,184,064

Average national lending

541,367

373,755

307,249

329,630

360,719

Average total loans

$

3,943,723

$

3,707,987

$

3,535,043

$

3,532,471

$

3,293,719

Community banking yield

5.79

%

5.88

%

5.91

%

5.82

%

5.75

%

Commercial finance yield

12.31

%

12.52

%

12.50

%

12.82

%

13.00

%

National lending yield

4.63

%

5.62

%

5.73

%

5.44

%

5.54

%

Total loan yield

7.63

%

7.95

%

7.99

%

8.14

%

8.33

%

Information pertaining to our factoring segment, which includes only factoring originated by our Triumph Business Capital subsidiary, summarized as of and for the quarters ended:

September 30,

June 30,

March 31,

December 31,

September 30,

2019

2019

2019

2018

2018

Factored receivable period end balance

$

562,009,000

$

544,601,000

$

534,420,000

$

588,750,000

$

579,985,000

Yield on average receivable balance

18.23

%

18.73

%

17.96

%

18.24

%

18.96

%

Rolling twelve quarter annual charge-off rate

0.36

%

0.40

%

0.39

%

0.37

%

0.38

%

Factored receivables - transportation concentration

83

%

83

%

81

%

83

%

83

%

Interest income, including fees

$

24,869,000

$

24,762,000

$

23,803,000

$

27,578,000

$

27,420,000

Non-interest income

1,291,000

1,205,000

1,077,000

1,032,000

942,000

Factored receivable total revenue

26,160,000

25,967,000

24,880,000

28,610,000

28,362,000

Average net funds employed

494,198,000

483,203,000

490,241,000

547,996,000

525,499,000

Yield on average net funds employed

21.00

%

21.55

%

20.58

%

20.71

%

21.41

%

Accounts receivable purchased

$

1,450,905,000

$

1,408,982,000

$

1,325,140,000

$

1,541,332,000

$

1,503,049,000

Number of invoices purchased

890,986

874,248

789,838

882,042

836,771

Average invoice size

$

1,628

$

1,612

$

1,678

$

1,747

$

1,796

Average invoice size - transportation

$

1,497

$

1,492

$

1,541

$

1,625

$

1,666

Average invoice size - non-transportation

$

3,467

$

3,047

$

3,276

$

3,209

$

3,267

Net new clients

16

73

191

259

422

Period end clients

6,471

6,455

6,382

6,191

5,932

Deposits summarized as of:

September 30,

June 30,

March 31,

December 31,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

Non-interest bearing demand

$

754,233

$

684,223

$

667,597

$

724,527

$

697,903

Interest bearing demand

587,123

587,164

602,088

615,704

608,775

Individual retirement accounts

108,593

111,328

112,696

115,583

118,459

Money market

424,162

440,289

372,109

443,663

413,402

Savings

356,368

362,594

372,914

369,389

373,062

Certificates of deposit

1,120,850

1,122,873

851,411

835,127

854,048

Brokered deposits

346,504

350,507

335,625

346,356

373,400

Total deposits

$

3,697,833

$

3,658,978

$

3,314,440

$

3,450,349

$

3,439,049

Net interest margin summarized for the three months ended:

September 30, 2019

June 30, 2019

Average

Average

Average

Average

(Dollars in thousands)

Balance

Interest

Rate

Balance

Interest

Rate

Interest earning assets:

Interest earning cash balances

$

104,569

$

603

2.29

%

$

166,426

$

1,022

2.46

%

Taxable securities

278,878

2,495

3.55

%

287,607

2,317

3.23

%

Tax-exempt securities

48,685

289

2.36

%

61,712

350

2.28

%

FHLB and other restricted stock

19,698

209

4.21

%

21,851

146

2.67

%

Loans

3,943,723

75,819

7.63

%

3,707,987

73,468

7.95

%

Total interest earning assets

$

4,395,553

$

79,415

7.17

%

$

4,245,583

$

77,303

7.30

%

Non-interest earning assets:

Other assets

444,987

449,064

Total assets

$

4,840,540

$

4,694,647

Interest bearing liabilities:

Deposits:

Interest bearing demand

$

585,706

$

355

0.24

%

$

592,593

$

391

0.26

%

Individual retirement accounts

110,049

454

1.64

%

111,962

437

1.57

%

Money market

416,526

1,406

1.34

%

419,066

1,473

1.41

%

Savings

359,169

117

0.13

%

366,953

120

0.13

%

Certificates of deposit

1,113,006

6,588

2.35

%

1,006,950

5,568

2.22

%

Brokered deposits

352,430

2,116

2.38

%

337,086

2,021

2.40

%

Total interest bearing deposits

2,936,886

11,036

1.49

%

2,834,610

10,010

1.42

%

Subordinated notes

48,994

840

6.80

%

48,967

839

6.87

%

Junior subordinated debentures

39,364

719

7.25

%

39,241

744

7.60

%

Other borrowings

364,950

2,055

2.23

%

368,455

2,291

2.49

%

Total interest bearing liabilities

$

3,390,194

$

14,650

1.71

%

$

3,291,273

$

13,884

1.69

%

Non-interest bearing liabilities and equity:

Non-interest bearing demand deposits

735,527

686,923

Other liabilities

68,778

64,104

Total equity

646,041

652,347

Total liabilities and equity

$

4,840,540

$

4,694,647

Net interest income

$

64,765

$

63,419

Interest spread

5.46

%

5.61

%

Net interest margin

5.85

%

5.99

%

Metrics and non-GAAP financial reconciliation:

As of and for the Three Months Ended

As of and for the Nine Months
Ended

(Dollars in thousands,

September 30,

June 30,

March 31,

December 31,

September 30,

September 30,

September 30,

except per share amounts)

2019

2019

2019

2018

2018

2019

2018

Net income available to common stockholders

$

14,317

$

12,730

$

14,788

$

18,085

$

8,975

$

41,835

$

33,045

Gain on sale of subsidiary or division

(1,071

)

Transaction related costs

5,871

6,965

Tax effect of adjustments

(1,392

)

(1,401

)

Adjusted net income available to common stockholders

$

14,317

$

12,730

$

14,788

$

18,085

$

13,454

$

41,835

$

37,538

Dilutive effect of convertible preferred stock

195

578

Adjusted net income available to common stockholders - diluted

$

14,317

$

12,730

$

14,788

$

18,085

$

13,649

$

41,835

$

38,116

Weighted average shares outstanding - diluted

25,734,471

26,486,423

26,793,685

26,979,949

26,991,830

26,331,740

24,974,308

Adjusted effects of assumed Preferred Stock conversion

Adjusted weighted average shares outstanding - diluted

25,734,471

26,486,423

26,793,685

26,979,949

26,991,830

26,331,740

24,974,308

Adjusted diluted earnings per common share

$

0.56

$

0.48

$

0.55

$

0.67

$

0.51

$

1.59

$

1.53

Average total stockholders' equity

$

646,041

$

652,347

$

644,960

$

632,126

$

618,682

$

647,787

$

534,958

Average preferred stock liquidation preference

2,624

9,658

9,658

Average total common stockholders' equity

646,041

652,347

644,960

629,502

609,025

647,787

525,300

Average goodwill and other intangibles

193,765

196,002

198,389

200,754

138,471

196,035

95,220

Average tangible common stockholders' equity

$

452,276

$

456,346

$

446,571

$

428,748

$

470,553

$

451,752

$

430,080

Net income available to common stockholders

$

14,317

$

12,730

$

14,788

$

18,085

$

8,975

$

41,835

$

33,045

Average tangible common equity

452,276

456,346

446,571

428,748

470,553

451,752

430,080

Return on average tangible common equity

12.56

%

11.19

%

13.43

%

16.73

%

7.57

%

12.38

%

10.27

%

Adjusted efficiency ratio:

Net interest income

$

64,765

$

63,419

$

61,311

$

64,881

$

61,782

$

189,495

$

162,169

Non-interest income

7,742

7,623

7,538

6,794

6,059

22,903

16,176

Operating revenue

72,507

71,042

68,849

71,675

67,841

212,398

178,345

Gain on sale of subsidiary or division

(1,071

)

Adjusted operating revenue

$

72,507

$

71,042

$

68,849

$

71,675

$

67,841

$

212,398

$

177,274

Non-interest expenses

$

52,153

$

50,704

$

48,566

$

46,962

$

48,946

$

151,423

$

120,391

Transaction related costs

(5,871

)

(6,965

)

Adjusted non-interest expenses

$

52,153

$

50,704

$

48,566

$

46,962

$

43,075

$

151,423

$

113,426

Adjusted efficiency ratio

71.93

%

71.37

%

70.54

%

65.52

%

63.49

%

71.29

%

63.98

%

Adjusted net non-interest expense to average assets ratio:

Non-interest expenses

$

52,153

$

50,704

$

48,566

$

46,962

$

48,946

$

151,423

$

120,391

Transaction related costs

(5,871

)

(6,965

)

Adjusted non-interest expenses

$

52,153

$

50,704

$

48,566

$

46,962

$

43,075

$

151,423

$

113,426

Total non-interest income

$

7,742

$

7,623

$

7,538

$

6,794

$

6,059

$

22,903

$

16,176

Gain on sale of subsidiary or division

(1,071

)

Adjusted non-interest income

$

7,742

$

7,623

$

7,538

$

6,794

$

6,059

$

22,903

$

15,105

Adjusted net non-interest expenses

$

44,411

$

43,081

$

41,028

$

40,168

$

37,016

$

128,520

$

98,321

Average total assets

$

4,840,540

$

4,694,647

$

4,501,760

$

4,488,918

$

4,060,560

$

4,680,234

$

3,702,513

Adjusted net non-interest expense to average assets ratio

3.64

%

3.68

%

3.70

%

3.55

%

3.62

%

3.67

%

3.55

%

Total stockholders' equity

$

633,693

$

643,362

$

646,216

$

636,607

$

616,641

$

633,693

$

616,641

Preferred stock liquidation preference

(9,658

)

(9,658

)

Total common stockholders' equity

633,693

643,362

646,216

636,607

606,983

633,693

606,983

Goodwill and other intangibles

(192,440

)

(194,668

)

(197,015

)

(199,417

)

(201,842

)

(192,440

)

(201,842

)

Tangible common stockholders' equity

$

441,253

$

448,694

$

449,201

$

437,190

$

405,141

$

441,253

$

405,141

Common shares outstanding

25,357,985

26,198,308

26,709,411

26,949,936

26,279,761

25,357,985

26,279,761

Tangible book value per share

$

17.40

$

17.13

$

16.82

$

16.22

$

15.42

$

17.40

$

15.42

Total assets at end of period

$

5,039,697

$

4,783,189

$

4,529,783

$

4,559,779

$

4,537,102

$

5,039,697

$

4,537,102

Goodwill and other intangibles

(192,440

)

(194,668

)

(197,015

)

(199,417

)

(201,842

)

(192,440

)

(201,842

)

Tangible assets at period end

$

4,847,257

$

4,588,521

$

4,332,768

$

4,360,362

$

4,335,260

$

4,847,257

$

4,335,260

Tangible common stockholders' equity ratio

9.10

%

9.78

%

10.37

%

10.03

%

9.35

%

9.10

%

9.35

%

1) Triumph uses certain non-GAAP financial measures to provide meaningful supplemental information regarding Triumph's operational performance and to enhance investors' overall understanding of such financial performance. The non-GAAP measures used by Triumph include the following:

  • “Adjusted diluted earnings per common share” is defined as adjusted net income available to common stockholders divided by adjusted weighted average diluted common shares outstanding. Excluded from net income available to common stockholders are material gains and expenses related to merger and acquisition-related activities, including divestitures, net of tax. In our judgment, the adjustments made to net income available to common stockholders allow management and investors to better assess our performance in relation to our core net income by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business. Weighted average diluted common shares outstanding are adjusted as a result of changes in their dilutive properties given the gain and expense adjustments described herein.

  • "Tangible common stockholders' equity" is defined as common stockholders' equity less goodwill and other intangible assets.

  • "Total tangible assets" is defined as total assets less goodwill and other intangible assets.

  • "Tangible book value per share" is defined as tangible common stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.

  • "Tangible common stockholders' equity ratio" is defined as the ratio of tangible common stockholders' equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets.

  • "Return on Average Tangible Common Equity" is defined as net income available to common stockholders divided by average tangible common stockholders' equity.

  • "Adjusted efficiency ratio" is defined as non-interest expenses divided by our operating revenue, which is equal to net interest income plus non-interest income. Also excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. In our judgment, the adjustments made to operating revenue and non-interest expense allow management and investors to better assess our performance in relation to our core operating revenue by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.

  • "Adjusted net non-interest expense to average total assets" is defined as non-interest expenses net of non-interest income divided by total average assets. Excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. This metric is used by our management to better assess our operating efficiency.

2) Performance ratios include discount accretion on purchased loans for the periods presented as follows:

For the Three Months Ended

For the Nine Months Ended

September 30,

June 30,

March 31,

December 31,

September 30,

September 30,

September 30,

(Dollars in thousands)

2019

2019

2019

2018

2018

2019

2018

Loan discount accretion

$

1,159

$

1,297

$

1,557

$

1,411

$

1,271

$

4,013

$

6,884

3) Asset quality ratios exclude loans held for sale, except for non-performing assets to total assets.

4) Current quarter ratios are preliminary.


Source: Triumph Bancorp, Inc.

Investor Relations:
Luke Wyse
Senior Vice President, Finance & Investor Relations
lwyse@tbkbank.com
214-365-6936

Media Contact:
Amanda Tavackoli
Senior Vice President, Marketing & Communication
atavackoli@tbkbank.com
214-365-6930