WICHITA, Kan., Oct. 17, 2023 (GLOBE NEWSWIRE) -- Equity Bancshares, Inc. (NYSE: EQBK), (“Equity”, “the Company”, “we,” “us,” “our”), the Wichita-based holding company of Equity Bank, reported net income of $12.3 million and $0.80 earnings per diluted share for the quarter ended September 30, 2023.
“Our Company's success is in large part due to our ability to adapt on behalf of our customers and teams no matter the banking environment. I’m pleased at our team’s ability to deliver unparalleled support and service to our customer base,” said Brad S. Elliott, Chairman and CEO of Equity. “Value creation is crucial for regional banks, and our ability to deliver sophisticated and customized solutions helps build our Company’s organic growth, sustainability, and competitive advantage.”
"During the third quarter our team continued to emphasize credit quality while meeting the needs of our customer base." Mr. Elliott said. "Our classified asset ratio is as low as it has ever been, while both capital and on balance sheet reserves remain high positioning Equity to be strategic as we assess both organic and acquisitive growth opportunities."
Notable Items:
- During the quarter, the Company realized linked period Net Interest Margin growth of 13 basis points, and Net Interest Income growth of $1.6 million.
- Pre-tax, pre-provision net income for the quarter was $15.5 million up $2.3 million linked quarter driven by growth in both net interest income and non-interest income.
- The Company continued to emphasize investor returns through share repurchase and quarterly dividends. The Company’s Board authorized a 20% increase in quarterly dividend to $0.12 per share, and authorized the repurchase of up to 1 million shares. During the quarter, the Company received non-objection from the Federal Reserve Bank of Kansas City related to the repurchase plan.
- Classified loans as a percentage of total risk-based capital at Equity Bank were 6.3%, down from 7.9% as of June 30, 2023, and 10.0% as of December 31, 2022.
During the third quarter, Equity announced two internal promotions to its executive management team. Chris Navratil was promoted to Chief Financial Officer and Krzysztof Slupkowski was promoted to Chief Credit Officer.
Financial Results for the Quarter Ended September 30, 2023
Net income allocable to common stockholders was $12.3 million, or $0.80 per diluted share, for the three months ended September 30, 2023, as compared to $11.5 million, or $0.74 per diluted share, for the three months ended June 30, 2023. The increase during the quarter was primarily driven by increases in interest income of $3.8 million and non-interest income of $1.8 million, partially offset by increases in interest expense of $2.2 million and non-interest expense of $1.1 million.
Net Interest Income
Net interest income was $41.0 million for the three months ended September 30, 2023, as compared to $39.4 million for the three months ended June 30, 2023, an increase of $1.6 million, or 4.01%. Net interest margin improved to 3.51% from 3.38% as the yield on interest-earning assets increased 32 basis points to 5.57% and the cost of interest-bearing deposits increased 26 basis points to 2.40%
The Company maintained an enhanced liquidity position in response to the first quarter market disruption by adding on-balance sheet cash, resulting in an adverse impact to net interest margin due to the increase in average earning assets and negligible impact to net interest income.
Average interest-bearing deposits declined slightly during the quarter and the Company continued to experience compositional shift from noninterest-bearing deposits into interest-bearing categories. At September 30, 2023, non-interest-bearing deposits declined $42.8 million from June 30, 2023 and $280.9 million from September 30, 2022. The majority of the decline over the last 12 months is due to deposits migrating to interest-bearing deposit accounts.
Provision for Credit Losses
During the three months ended September 30, 2023, there was a provision of $1.2 million compared to a provision of $298 thousand in the previous quarter. The provision for the quarter is the result of extended duration within the portfolio as well as realized charge-offs; however, overall we continue to experience positive credit trends. The Company continues to estimate the allowance for credit loss with assumptions that anticipate slower prepayments rates and continued market disruption caused by elevated inflation, supply chain issues and the impact of monetary policy on consumers and businesses. For the three months ended September 30, 2023, we had net charge-offs of $1.6 million as compared to $857 thousand for the three months ended June 30, 2023.
Non-Interest Income
Total non-interest income was $8.7 million for the three months ended September 30, 2023, as compared to $7.0 million for the three months ended June 30, 2023, or an increase of 25.7%, quarter-over-quarter. The $1.8 million increase was primarily due to a decrease in losses on sales of available-for-sale securities of $1.3 million and an increase in other non-interest income of $439 thousand which was driven by increased insurance commission revenue.
Non-Interest Expense
Total non-interest expense for the quarter ended September 30, 2023, was $34.2 million as compared to $33.1 million for the quarter ended June 30, 2023, an increase of $1.1 million. The comparative increase was primarily due to salary and employee benefit expenses as the Company benefited from compensation reversals in the previous quarter which did not repeat.
Income Tax Expense
At September 30, 2023, the effective tax rate for the quarter was 13.5% as compared to 11.5% at June 30, 2023. The year-to-date tax rate is 14.1%. The increase in rate linked quarter is associated with the cumulative increase in federal and state tax benefits related to the implementation of tax planning initiatives taken in the second quarter versus the normal quarterly recognition of these tax planning initiatives taken in the third quarter offset by a return to provision adjustment related to the federal income tax return when taken as a percentage of pre-tax income. These initiatives were anticipated and incorporated in our forecasted full year estimated effective tax rate at June 30, 2023.
Loans, Total Assets and Funding
Loans held for investment were $3.28 billion at September 30, 2023, decreasing $40.6 million compared to the previous quarter. Excluding the impact of PPP loans, balances have increased $32.9 million, or 1.0% year-over-year. Included in the annual growth, is $49.3 million within the commercial and industrial and commercial real estate portfolios, or 2.9%. Total assets were $4.95 billion as of September 30, 2023 decreasing $149.6 million or 2.9% from June 30, 2023.
Total deposits were $4.08 billion at September 30, 2023, decreasing $148.8 million from the previous quarter end and decreasing $144.4 million from the same period end in 2022. During the third quarter, the Company reduced its brokered deposits by $50.0 million; improving the overall mix of the deposit portfolio during the third quarter. In addition to the payoff of brokered funding, the Company also realized seasonal declines in our municipal deposit portfolio accounting for the remaining negative trend linked quarter. Of the total deposit balance, non-interest-bearing accounts comprise approximately 23.6%. Advances from the FHLB and borrowings from the Federal Reserve's Bank Term Funding Program remained unchanged from June 30, 2023.
Asset Quality
As of September 30, 2023, Equity’s allowance for credit losses to total loans remained materially consistent at 1.3% as compared to June 30, 2023. Nonperforming assets were $20.5 million as of September 30, 2023, or 0.4% of total assets, compared to $15.7 million at June 30, 2023, or 0.3% of total assets. Non-accrual loans were $19.4 million at September 30, 2023, as compared to $15.0 million at June 30, 2023. Total classified assets, including loans rated special mention or worse, other real estate owned, excluding previous branch locations, and other repossessed assets were $37.6 million, or 6.3% of regulatory capital, down from $47.1 million, or 7.9% of regulatory capital as of June 30, 2023.
Capital
Quarter over quarter, book and tangible capital as well as book and tangible capital per share were essentially flat. Dividends paid and increase in the unrealized loss position in our investment portfolio of $13.3 million, partially offset by unrealized gains on cash-flow derivatives of $1.5 million, were materially offset by net income in the period.
The Company’s ratio of common equity tier 1 capital to risk-weighted assets was 12.7%, the total capital to risk-weighted assets was 16.4% and the total leverage ratio was 9.8% at September 30, 2023. At June 30, 2023, the Company’s common equity tier 1 capital to risk-weighted assets ratio was 12.2%, the total capital to risk-weighted assets ratio was 16.0% and the total leverage ratio was 9.5%.
The Company’s subsidiary, Equity Bank, had a ratio of common equity tier 1 capital to risk-weighted assets of 14.7%, a ratio of total capital to risk-weighted assets of 15.9% and a total leverage ratio of 10.8% at September 30, 2023. At June 30, 2023, Equity Bank’s ratio of common equity tier 1 capital to risk-weighted assets was 14.3%, the ratio of total capital to risk-weighted assets was 15.5% and the total leverage ratio was 10.7%.
Non-GAAP Financial Measures
In addition to evaluating the Company’s results of operations in accordance with accounting principles generally accepted in the United States of America (“GAAP”), management periodically supplements this evaluation with an analysis of certain non-GAAP financial measures that are intended to provide the reader with additional perspectives on operating results, financial condition and performance trends, while facilitating comparisons with the performance of other financial institutions. Non-GAAP financial measures are not a substitute for GAAP measures, rather, they should be read and used in conjunction with the Company’s GAAP financial information.
The efficiency ratio is a common comparable metric used by banks to understand the expense structure relative to total revenue. In other words, for every dollar of total revenue recognized, how much of that dollar is expended. To improve the comparability of the ratio to our peers, non-core items are excluded. To improve transparency and acknowledging that banks are not consistent in their definition of the efficiency ratio, we include our calculation of this non-GAAP measure.
Return on average assets before income tax provision and provision for loan losses is a measure that the Company uses to understand fundamental operating performance before these expenses. Used as a ratio relative to average assets, we believe it demonstrates “core” performance and can be viewed as an alternative measure of how efficiently the Company services its asset base. Used as a ratio relative to average equity, it can function as an alternative measure of the Company’s earnings performance in relationship to its equity.
Tangible common equity and related measures are non-GAAP financial measures that exclude the impact of intangible assets, net of deferred taxes, and their related amortization. These financial measures are useful for evaluating the performance of a business consistently, whether acquired or developed internally. Return on average tangible common equity is used by management and readers of our financial statements to understand how efficiently the Company is deploying its common equity. Companies that are able to demonstrate more efficient use of common equity are more likely to be viewed favorably by current and prospective investors.
The Company believes that disclosing these non-GAAP financial measures is both useful internally and is expected by our investors and analysts in order to understand the overall performance of the Company. Other companies may calculate and define their non-GAAP financial measures and supplemental data differently. A reconciliation of GAAP financial measures to non-GAAP measures and other performance ratios, as adjusted, are included in Table 6 in the following press release tables.
Conference Call and Webcast
Equity’s Chairman and Chief Executive Officer, Brad Elliott, and Chief Financial Officer, Chris Navratil, will hold a conference call and webcast to discuss third quarter results on Wednesday, October 18, 2023, at 10 a.m. eastern time or 9 a.m. central time.
A live webcast of the call will be available on the Company’s website at investor.equitybank.com. To access the call by phone, please go to this registration link, and you will be provided with dial in details. Investors, news media, and other participants are encouraged to dial into the conference call ten minutes ahead of the scheduled start time.
A replay of the call and webcast will be available two hours following the close of the call until October 25, 2023, accessible at investor.equitybank.com.
About Equity Bancshares, Inc.
Equity Bancshares, Inc. is the holding company for Equity Bank, offering a full range of financial solutions, including commercial loans, consumer banking, mortgage loans, trust and wealth management services and treasury management services, while delivering the high-quality, relationship-based customer service of a community bank. Equity’s common stock is traded on the NYSE National, Inc. under the symbol “EQBK.” Learn more at www.equitybank.com.
Special Note Concerning Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect the current views of Equity’s management with respect to, among other things, future events and Equity’s financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “positioned,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about Equity’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond Equity’s control. Accordingly, Equity cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although Equity believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from Equity’s expectations include COVID-19 related impacts; competition from other financial institutions and bank holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses; and similar variables. The foregoing list of factors is not exhaustive.
For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in Equity’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 9, 2023, and any updates to those risk factors set forth in Equity’s subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if Equity’s underlying assumptions prove to be incorrect, actual results may differ materially from what Equity anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and Equity does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. New risks and uncertainties arise from time to time and it is not possible for us to predict those events or how they may affect us. In addition, Equity cannot assess the impact of each factor on Equity’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Equity or persons acting on Equity’s behalf may issue.
Investor Contact:
Brian J. Katzfey
VP, Director of Corporate Development and Investor Relations
Equity Bank
(316) 858-3128
bkatzfey@equitybank.com
Media Contact:
John J. Hanley
SVP, Senior Director of Marketing
Equity Bancshares, Inc.
(913) 583-8004
jhanley@equitybank.com
Unaudited Financial Tables
- Table 1. Consolidated Statements of Income
- Table 2. Quarterly Consolidated Statements of Income
- Table 3. Consolidated Balance Sheets
- Table 4. Selected Financial Highlights
- Table 5. Year-To-Date Net Interest Income Analysis
- Table 6. Quarter-To-Date Net Interest Income Analysis
- Table 7. Quarter-Over-Quarter Net Interest Income Analysis
- Table 8. Non-GAAP Financial Measures
| TABLE 1. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share data) | ||||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Interest and dividend income | ||||||||||||||||
| Loans, including fees | $ | 55,152 | $ | 41,555 | $ | 156,281 | $ | 114,710 | ||||||||
| Securities, taxable | 5,696 | 5,792 | 17,456 | 16,767 | ||||||||||||
| Securities, nontaxable | 369 | 687 | 1,606 | 2,020 | ||||||||||||
| Federal funds sold and other | 3,822 | 514 | 7,075 | 1,327 | ||||||||||||
| Total interest and dividend income | 65,039 | 48,548 | 182,418 | 134,824 | ||||||||||||
| Interest expense | ||||||||||||||||
| Deposits | 19,374 | 4,403 | 50,399 | 8,308 | ||||||||||||
| Federal funds purchased and retail repurchase agreements | 246 | 71 | 633 | 150 | ||||||||||||
| Federal Home Loan Bank advances | 968 | 409 | 2,939 | 594 | ||||||||||||
| Federal Reserve Bank borrowings | 1,546 | — | 3,209 | — | ||||||||||||
| Subordinated debt | 1,893 | 1,721 | 5,687 | 4,973 | ||||||||||||
| Total interest expense | 24,027 | 6,604 | 62,867 | 14,025 | ||||||||||||
| Net interest income | 41,012 | 41,944 | 119,551 | 120,799 | ||||||||||||
| Provision (reversal) for credit losses | 1,230 | (136 | ) | 1,162 | 276 | |||||||||||
| Net interest income after provision (reversal) for credit losses | 39,782 | 42,080 | 118,389 | 120,523 | ||||||||||||
| Non-interest income | ||||||||||||||||
| Service charges and fees | 2,690 | 2,788 | 7,888 | 7,927 | ||||||||||||
| Debit card income | 2,591 | 2,682 | 7,798 | 8,120 | ||||||||||||
| Mortgage banking | 226 | 310 | 527 | 1,300 | ||||||||||||
| Increase in value of bank-owned life insurance | 794 | 754 | 3,134 | 2,355 | ||||||||||||
| Net gain on acquisition and branch sales | — | — | — | 540 | ||||||||||||
| Net gains (losses) from securities transactions | (1 | ) | (17 | ) | (1,291 | ) | (9 | ) | ||||||||
| Other | 2,435 | 2,452 | 6,229 | 7,395 | ||||||||||||
| Total non-interest income | 8,735 | 8,969 | 24,285 | 27,628 | ||||||||||||
| Non-interest expense | ||||||||||||||||
| Salaries and employee benefits | 15,857 | 15,442 | 47,786 | 45,893 | ||||||||||||
| Net occupancy and equipment | 3,262 | 3,127 | 9,081 | 9,304 | ||||||||||||
| Data processing | 4,553 | 4,138 | 12,962 | 11,549 | ||||||||||||
| Professional fees | 1,312 | 1,265 | 4,341 | 3,547 | ||||||||||||
| Advertising and business development | 1,419 | 1,191 | 3,827 | 3,139 | ||||||||||||
| Telecommunications | 502 | 487 | 1,503 | 1,399 | ||||||||||||
| FDIC insurance | 660 | 340 | 1,535 | 780 | ||||||||||||
| Courier and postage | 548 | 436 | 1,469 | 1,348 | ||||||||||||
| Free nationwide ATM cost | 516 | 551 | 1,565 | 1,593 | ||||||||||||
| Amortization of core deposit intangibles | 799 | 957 | 2,635 | 3,118 | ||||||||||||
| Loan expense | 132 | 174 | 385 | 566 | ||||||||||||
| Other real estate owned | 128 | 188 | 318 | 201 | ||||||||||||
| Merger expenses | — | 115 | — | 526 | ||||||||||||
| Other | 4,556 | 3,825 | 13,196 | 10,168 | ||||||||||||
| Total non-interest expense | 34,244 | 32,236 | 100,603 | 93,131 | ||||||||||||
| Income (loss) before income tax | 14,273 | 18,813 | 42,071 | 55,020 | ||||||||||||
| Provision for income taxes | 1,932 | 3,642 | 5,951 | 8,940 | ||||||||||||
| Net income (loss) and net income (loss) allocable to common stockholders | $ | 12,341 | $ | 15,171 | $ | 36,120 | $ | 46,080 | ||||||||
| Basic earnings (loss) per share | $ | 0.80 | $ | 0.94 | $ | 2.32 | $ | 2.83 | ||||||||
| Diluted earnings (loss) per share | $ | 0.80 | $ | 0.93 | $ | 2.30 | $ | 2.79 | ||||||||
| Weighted average common shares | 15,404,992 | 16,056,658 | 15,575,731 | 16,303,586 | ||||||||||||
| Weighted average diluted common shares | 15,507,172 | 16,273,231 | 15,692,305 | 16,516,787 | ||||||||||||
| TABLE 2. QUARTERLY CONSOLIDATED STATEMENTS OF INCOME (Unaudited) | ||||||||||||||||||||
| (Dollars in thousands, except per share data) | ||||||||||||||||||||
| As of and for the three months ended | ||||||||||||||||||||
| September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | September 30, 2022 | ||||||||||||||||
| Interest and dividend income | ||||||||||||||||||||
| Loans, including fees | $ | 55,152 | $ | 52,748 | $ | 48,381 | $ | 46,149 | $ | 41,555 | ||||||||||
| Securities, taxable | 5,696 | 5,813 | 5,947 | 5,946 | 5,792 | |||||||||||||||
| Securities, nontaxable | 369 | 568 | 669 | 678 | 687 | |||||||||||||||
| Federal funds sold and other | 3,822 | 2,127 | 1,126 | 651 | 514 | |||||||||||||||
| Total interest and dividend income | 65,039 | 61,256 | 56,123 | 53,424 | 48,548 | |||||||||||||||
| Interest expense | ||||||||||||||||||||
| Deposits | 19,374 | 17,204 | 13,821 | 8,013 | 4,403 | |||||||||||||||
| Federal funds purchased and retail repurchase agreements | 246 | 192 | 195 | 82 | 71 | |||||||||||||||
| Federal Home Loan Bank advances | 968 | 953 | 1,018 | 1,500 | 409 | |||||||||||||||
| Federal Reserve Bank borrowings | 1,546 | 1,528 | 135 | — | — | |||||||||||||||
| Subordinated debt | 1,893 | 1,950 | 1,844 | 1,798 | 1,721 | |||||||||||||||
| Total interest expense | 24,027 | 21,827 | 17,013 | 11,393 | 6,604 | |||||||||||||||
| Net interest income | 41,012 | 39,429 | 39,110 | 42,031 | 41,944 | |||||||||||||||
| Provision (reversal) for credit losses | 1,230 | 298 | (366 | ) | (151 | ) | (136 | ) | ||||||||||||
| Net interest income after provision (reversal) for credit losses | 39,782 | 39,131 | 39,476 | 42,182 | 42,080 | |||||||||||||||
| Non-interest income | ||||||||||||||||||||
| Service charges and fees | 2,690 | 2,653 | 2,545 | 2,705 | 2,788 | |||||||||||||||
| Debit card income | 2,591 | 2,653 | 2,554 | 2,557 | 2,682 | |||||||||||||||
| Mortgage banking | 226 | 213 | 88 | 116 | 310 | |||||||||||||||
| Increase in value of bank-owned life insurance | 794 | 757 | 1,583 | 758 | 754 | |||||||||||||||
| Net gain on acquisition and branch sales | — | — | — | 422 | — | |||||||||||||||
| Net gains (losses) from securities transactions | (1 | ) | (1,322 | ) | 32 | 14 | (17 | ) | ||||||||||||
| Other | 2,435 | 1,996 | 1,798 | 1,757 | 2,452 | |||||||||||||||
| Total non-interest income | 8,735 | 6,950 | 8,600 | 8,329 | 8,969 | |||||||||||||||
| Non-interest expense | ||||||||||||||||||||
| Salaries and employee benefits | 15,857 | 15,237 | 16,692 | 16,113 | 15,442 | |||||||||||||||
| Net occupancy and equipment | 3,262 | 2,940 | 2,879 | 2,919 | 3,127 | |||||||||||||||
| Data processing | 4,553 | 4,493 | 3,916 | 4,334 | 4,138 | |||||||||||||||
| Professional fees | 1,312 | 1,645 | 1,384 | 1,404 | 1,265 | |||||||||||||||
| Advertising and business development | 1,419 | 1,249 | 1,159 | 1,903 | 1,191 | |||||||||||||||
| Telecommunications | 502 | 516 | 485 | 517 | 487 | |||||||||||||||
| FDIC insurance | 660 | 515 | 360 | 360 | 340 | |||||||||||||||
| Courier and postage | 548 | 463 | 458 | 533 | 436 | |||||||||||||||
| Free nationwide ATM cost | 516 | 524 | 525 | 510 | 551 | |||||||||||||||
| Amortization of core deposit intangibles | 799 | 918 | 918 | 924 | 957 | |||||||||||||||
| Loan expense | 132 | 136 | 117 | 262 | 174 | |||||||||||||||
| Other real estate owned | 128 | 71 | 119 | 388 | 188 | |||||||||||||||
| Merger expenses | — | — | — | 68 | 115 | |||||||||||||||
| Other | 4,556 | 4,423 | 4,217 | 5,014 | 3,825 | |||||||||||||||
| Total non-interest expense | 34,244 | 33,130 | 33,229 | 35,249 | 32,236 | |||||||||||||||
| Income (loss) before income tax | 14,273 | 12,951 | 14,847 | 15,262 | 18,813 | |||||||||||||||
| Provision for income taxes (benefit) | 1,932 | 1,495 | 2,524 | 3,654 | 3,642 | |||||||||||||||
| Net income (loss) and net income (loss) allocable to common stockholders | $ | 12,341 | $ | 11,456 | $ | 12,323 | $ | 11,608 | $ | 15,171 | ||||||||||
| Basic earnings (loss) per share | $ | 0.80 | $ | 0.74 | $ | 0.78 | $ | 0.73 | $ | 0.94 | ||||||||||
| Diluted earnings (loss) per share | $ | 0.80 | $ | 0.74 | $ | 0.77 | $ | 0.72 | $ | 0.93 | ||||||||||
| Weighted average common shares | 15,404,992 | 15,468,378 | 15,858,808 | 15,948,360 | 16,056,658 | |||||||||||||||
| Weighted average diluted common shares | 15,507,172 | 15,554,255 | 16,028,051 | 16,204,185 | 16,273,231 | |||||||||||||||
| TABLE 3. CONSOLIDATED BALANCE SHEETS (Unaudited) (Dollars in thousands) | ||||||||||||||||||||
| September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | September 30, 2022 | ||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and due from banks | $ | 183,404 | $ | 262,604 | $ | 249,982 | $ | 104,013 | $ | 155,039 | ||||||||||
| Federal funds sold | 15,613 | 15,495 | 384 | 415 | 374 | |||||||||||||||
| Cash and cash equivalents | 199,017 | 278,099 | 250,366 | 104,428 | 155,413 | |||||||||||||||
| Available-for-sale securities | 1,057,009 | 1,094,748 | 1,183,247 | 1,184,390 | 1,198,962 | |||||||||||||||
| Held-to-maturity securities | 2,212 | 2,216 | 1,944 | 1,948 | — | |||||||||||||||
| Loans held for sale | 627 | 2,456 | 648 | 349 | 1,518 | |||||||||||||||
| Loans, net of allowance for credit losses(1) | 3,237,932 | 3,278,126 | 3,285,515 | 3,265,701 | 3,208,524 | |||||||||||||||
| Other real estate owned, net | 3,369 | 4,362 | 4,171 | 4,409 | 10,412 | |||||||||||||||
| Premises and equipment, net | 110,271 | 106,186 | 104,789 | 101,492 | 100,566 | |||||||||||||||
| Bank-owned life insurance | 124,245 | 123,451 | 122,971 | 123,176 | 122,418 | |||||||||||||||
| Federal Reserve Bank and Federal Home Loan Bank stock | 20,780 | 21,129 | 33,359 | 21,695 | 24,428 | |||||||||||||||
| Interest receivable | 23,621 | 21,360 | 20,461 | 20,630 | 18,497 | |||||||||||||||
| Goodwill | 53,101 | 53,101 | 53,101 | 53,101 | 53,101 | |||||||||||||||
| Core deposit intangibles, net | 7,961 | 8,760 | 9,678 | 10,596 | 11,598 | |||||||||||||||
| Other | 105,122 | 100,889 | 86,466 | 89,736 | 94,978 | |||||||||||||||
| Total assets | $ | 4,945,267 | $ | 5,094,883 | $ | 5,156,716 | $ | 4,981,651 | $ | 5,000,415 | ||||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||
| Deposits | ||||||||||||||||||||
| Demand | $ | 936,217 | $ | 978,968 | $ | 1,012,671 | $ | 1,097,899 | $ | 1,217,094 | ||||||||||
| Total non-interest-bearing deposits | 936,217 | 978,968 | 1,012,671 | 1,097,899 | 1,217,094 | |||||||||||||||
| Demand, savings and money market | 2,397,003 | 2,397,524 | 2,334,463 | 2,329,584 | 2,335,847 | |||||||||||||||
| Time | 748,950 | 854,458 | 939,799 | 814,324 | 673,670 | |||||||||||||||
| Total interest-bearing deposits | 3,145,953 | 3,251,982 | 3,274,262 | 3,143,908 | 3,009,517 | |||||||||||||||
| Total deposits | 4,082,170 | 4,230,950 | 4,286,933 | 4,241,807 | 4,226,611 | |||||||||||||||
| Federal funds purchased and retail repurchase agreements | 39,701 | 44,770 | 45,098 | 46,478 | 47,443 | |||||||||||||||
| Federal Home Loan Bank advances and Federal Reserve Bank borrowings | 240,000 | 240,000 | 251,222 | 138,864 | 186,001 | |||||||||||||||
| Subordinated debt | 96,787 | 96,653 | 96,522 | 96,392 | 96,263 | |||||||||||||||
| Contractual obligations | 29,019 | 29,608 | 19,372 | 15,218 | 15,562 | |||||||||||||||
| Interest payable and other liabilities | 39,460 | 34,467 | 32,446 | 32,834 | 32,729 | |||||||||||||||
| Total liabilities | 4,527,137 | 4,676,448 | 4,731,593 | 4,571,593 | 4,604,609 | |||||||||||||||
| Commitments and contingent liabilities | ||||||||||||||||||||
| Stockholders’ equity | ||||||||||||||||||||
| Common stock | 207 | 207 | 206 | 205 | 204 | |||||||||||||||
| Additional paid-in capital | 488,137 | 487,225 | 486,658 | 484,989 | 482,668 | |||||||||||||||
| Retained earnings | 171,188 | 160,715 | 150,810 | 140,095 | 130,114 | |||||||||||||||
| Accumulated other comprehensive income (loss), net of tax | (122,047 | ) | (110,225 | ) | (101,238 | ) | (113,511 | ) | (120,918 | ) | ||||||||||
| Treasury stock | (119,355 | ) | (119,487 | ) | (111,313 | ) | (101,720 | ) | (96,262 | ) | ||||||||||
| Total stockholders’ equity | 418,130 | 418,435 | 425,123 | 410,058 | 395,806 | |||||||||||||||
| Total liabilities and stockholders’ equity | $ | 4,945,267 | $ | 5,094,883 | $ | 5,156,716 | $ | 4,981,651 | $ | 5,000,415 | ||||||||||
| (1) Allowance for credit losses | $ | 44,186 | $ | 44,544 | $ | 45,103 | $ | 45,847 | $ | 46,499 | ||||||||||
| TABLE 4. SELECTED FINANCIAL HIGHLIGHTS (Unaudited) | ||||||||||||||||||||
| (Dollars in thousands, except per share data) | ||||||||||||||||||||
| As of and for the three months ended | ||||||||||||||||||||
| September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
| 2023 | 2023 | 2023 | 2022 | 2022 | ||||||||||||||||
| Loans Held For Investment by Type | ||||||||||||||||||||
| Commercial real estate | $ | 1,721,761 | $ | 1,764,460 | $ | 1,746,834 | $ | 1,721,269 | $ | 1,655,646 | ||||||||||
| Commercial and industrial | 585,129 | 583,664 | 605,576 | 594,862 | 607,722 | |||||||||||||||
| Residential real estate | 558,188 | 560,389 | 563,791 | 570,550 | 573,431 | |||||||||||||||
| Agricultural real estate | 205,865 | 202,317 | 202,274 | 199,189 | 200,415 | |||||||||||||||
| Agricultural | 103,352 | 104,510 | 106,169 | 120,003 | 115,048 | |||||||||||||||
| Consumer | 107,823 | 107,330 | 105,974 | 105,675 | 102,761 | |||||||||||||||
| Total loans held-for-investment | 3,282,118 | 3,322,670 | 3,330,618 | 3,311,548 | 3,255,023 | |||||||||||||||
| Allowance for credit losses | (44,186 | ) | (44,544 | ) | (45,103 | ) | (45,847 | ) | (46,499 | ) | ||||||||||
| Net loans held for investment | $ | 3,237,932 | $ | 3,278,126 | $ | 3,285,515 | $ | 3,265,701 | $ | 3,208,524 | ||||||||||
| Asset Quality Ratios | ||||||||||||||||||||
| Allowance for credit losses on loans to total loans | 1.35 | % | 1.34 | % | 1.35 | % | 1.38 | % | 1.43 | % | ||||||||||
| Past due or nonaccrual loans to total loans | 1.03 | % | 0.78 | % | 0.66 | % | 0.72 | % | 0.94 | % | ||||||||||
| Nonperforming assets to total assets | 0.41 | % | 0.31 | % | 0.33 | % | 0.37 | % | 0.59 | % | ||||||||||
| Nonperforming assets to total loans plus other real estate owned | 0.62 | % | 0.47 | % | 0.51 | % | 0.55 | % | 0.91 | % | ||||||||||
| Classified assets to bank total regulatory capital | 6.27 | % | 7.94 | % | 10.09 | % | 9.98 | % | 11.03 | % | ||||||||||
| Selected Average Balance Sheet Data (QTD Average) | ||||||||||||||||||||
| Investment securities | $ | 1,085,905 | $ | 1,155,971 | $ | 1,185,482 | $ | 1,184,452 | $ | 1,272,414 | ||||||||||
| Total gross loans receivable | 3,281,483 | 3,337,497 | 3,305,681 | 3,275,284 | 3,240,998 | |||||||||||||||
| Interest-earning assets | 4,635,384 | 4,678,744 | 4,611,019 | 4,538,177 | 4,602,568 | |||||||||||||||
| Total assets | 5,046,179 | 5,064,912 | 4,994,417 | 4,930,231 | 4,988,755 | |||||||||||||||
| Interest-bearing deposits | 3,206,300 | 3,226,965 | 3,235,557 | 3,032,902 | 3,081,245 | |||||||||||||||
| Borrowings | 385,125 | 385,504 | 247,932 | 299,191 | 221,514 | |||||||||||||||
| Total interest-bearing liabilities | 3,591,425 | 3,612,469 | 3,483,489 | 3,335,557 | 3,302,759 | |||||||||||||||
| Total deposits | 4,177,332 | 4,204,334 | 4,279,451 | 4,185,904 | 4,283,855 | |||||||||||||||
| Total liabilities | 4,619,919 | 4,640,050 | 4,573,917 | 4,531,961 | 4,552,564 | |||||||||||||||
| Total stockholders' equity | 426,260 | 424,862 | 420,500 | 398,270 | 436,191 | |||||||||||||||
| Tangible common equity* | 363,625 | 361,409 | 356,053 | 332,820 | 369,746 | |||||||||||||||
| Performance ratios | ||||||||||||||||||||
| Return on average assets (ROAA) annualized | 0.97 | % | 0.91 | % | 1.00 | % | 0.93 | % | 1.21 | % | ||||||||||
| Return on average assets before income tax and provision for loan losses* | 1.22 | % | 1.05 | % | 1.18 | % | 1.22 | % | 1.49 | % | ||||||||||
| Return on average equity (ROAE) annualized | 11.49 | % | 10.82 | % | 11.89 | % | 11.57 | % | 13.80 | % | ||||||||||
| Return on average equity before income tax and provision for loan losses* | 14.43 | % | 12.51 | % | 13.97 | % | 15.05 | % | 16.99 | % | ||||||||||
| Return on average tangible common equity (ROATCE) annualized* | 14.18 | % | 13.55 | % | 14.89 | % | 14.74 | % | 17.12 | % | ||||||||||
| Yield on loans annualized | 6.67 | % | 6.34 | % | 5.94 | % | 5.59 | % | 5.09 | % | ||||||||||
| Cost of interest-bearing deposits annualized | 2.40 | % | 2.14 | % | 1.73 | % | 1.05 | % | 0.57 | % | ||||||||||
| Cost of total deposits annualized | 1.84 | % | 1.64 | % | 1.31 | % | 0.76 | % | 0.41 | % | ||||||||||
| Net interest margin annualized | 3.51 | % | 3.38 | % | 3.44 | % | 3.67 | % | 3.62 | % | ||||||||||
| Efficiency ratio* | 68.83 | % | 69.44 | % | 70.00 | % | 70.47 | % | 63.07 | % | ||||||||||
| Non-interest income / average assets | 0.69 | % | 0.55 | % | 0.74 | % | 0.67 | % | 0.71 | % | ||||||||||
| Non-interest expense / average assets | 2.69 | % | 2.62 | % | 2.74 | % | 2.84 | % | 2.56 | % | ||||||||||
| Capital Ratios | ||||||||||||||||||||
| Tier 1 Leverage Ratio | 9.77 | % | 9.54 | % | 9.60 | % | 9.61 | % | 9.46 | % | ||||||||||
| Common Equity Tier 1 Capital Ratio | 12.65 | % | 12.23 | % | 12.21 | % | 12.26 | % | 12.15 | % | ||||||||||
| Tier 1 Risk Based Capital Ratio | 13.28 | % | 12.84 | % | 12.83 | % | 12.88 | % | 12.77 | % | ||||||||||
| Total Risk Based Capital Ratio | 16.42 | % | 15.96 | % | 15.98 | % | 16.08 | % | 15.99 | % | ||||||||||
| Total stockholders' equity to total assets | 8.46 | % | 8.21 | % | 8.24 | % | 8.23 | % | 7.92 | % | ||||||||||
| Tangible common equity to tangible assets* | 7.29 | % | 7.06 | % | 7.09 | % | 7.02 | % | 6.68 | % | ||||||||||
| Dividend payout ratio | 15.13 | % | 13.53 | % | 10.49 | % | 14.01 | % | 10.78 | % | ||||||||||
| Book value per common share | $ | 27.13 | $ | 27.18 | $ | 27.03 | $ | 25.74 | $ | 24.71 | ||||||||||
| Tangible book value per common share* | $ | 23.09 | $ | 23.08 | $ | 22.96 | $ | 21.67 | $ | 20.59 | ||||||||||
| Tangible book value per diluted common share* | $ | 22.96 | $ | 22.98 | $ | 22.83 | $ | 21.35 | $ | 20.33 | ||||||||||
| * The value noted is considered a Non-GAAP financial measure. For a reconciliation of Non-GGAP financial measures, see Table 8. Non-GAAP Financial Measures. | ||||||||||||||||||||
| TABLE 5. YEAR-TO-DATE NET INTEREST INCOME ANALYSIS (Unaudited) (Dollars in thousands) | |||||||||||||||||||||||
| For nine months ended | For nine months ended | ||||||||||||||||||||||
| September 30, 2023 | September 30, 2022 | ||||||||||||||||||||||
| Average Outstanding Balance | Interest Income/ Expense | Average Yield/Rate(3)(4) | Average Outstanding Balance | Interest Income/ Expense | Average Yield/Rate(3)(4) | ||||||||||||||||||
| Interest-earning assets | |||||||||||||||||||||||
| Loans (1) | |||||||||||||||||||||||
| Commercial and industrial | $ | 580,359 | $ | 31,503 | 7.26 | % | $ | 579,610 | $ | 22,994 | 5.30 | % | |||||||||||
| Commercial real estate | 1,300,202 | 61,811 | 6.36 | % | 1,236,282 | 45,995 | 4.97 | % | |||||||||||||||
| Real estate construction | 450,147 | 24,764 | 7.36 | % | 362,543 | 12,443 | 4.59 | % | |||||||||||||||
| Residential real estate | 567,169 | 17,933 | 4.23 | % | 604,218 | 16,336 | 3.61 | % | |||||||||||||||
| Agricultural real estate | 202,963 | 10,399 | 6.85 | % | 201,566 | 8,046 | 5.34 | % | |||||||||||||||
| Agricultural | 100,450 | 5,039 | 6.71 | % | 132,485 | 5,254 | 5.30 | % | |||||||||||||||
| Consumer | 106,841 | 4,832 | 6.05 | % | 101,341 | 3,642 | 4.80 | % | |||||||||||||||
| Total loans | 3,308,131 | 156,281 | 6.32 | % | 3,218,045 | 114,710 | 4.77 | % | |||||||||||||||
| Securities | |||||||||||||||||||||||
| Taxable securities | 1,059,858 | 17,456 | 2.20 | % | 1,220,045 | 16,767 | 1.84 | % | |||||||||||||||
| Nontaxable securities | 82,230 | 1,606 | 2.61 | % | 109,142 | 2,020 | 2.47 | % | |||||||||||||||
| Total securities | 1,142,088 | 19,062 | 2.23 | % | 1,329,187 | 18,787 | 1.89 | % | |||||||||||||||
| Federal funds sold and other | 191,585 | 7,075 | 4.94 | % | 116,997 | 1,327 | 1.52 | % | |||||||||||||||
| Total interest-earning assets | $ | 4,641,804 | 182,418 | 5.25 | % | $ | 4,664,229 | 134,824 | 3.86 | % | |||||||||||||
| Interest-bearing liabilities | |||||||||||||||||||||||
| Demand, savings and money market deposits | $ | 2,365,972 | 32,288 | 1.82 | % | $ | 2,480,113 | 5,461 | 0.29 | % | |||||||||||||
| Time deposits | 856,862 | 18,111 | 2.83 | % | 638,692 | 2,847 | 0.60 | % | |||||||||||||||
| Total interest-bearing deposits | 3,222,834 | 50,399 | 2.09 | % | 3,118,805 | 8,308 | 0.36 | % | |||||||||||||||
| FHLB advances | 97,014 | 2,939 | 4.05 | % | 54,100 | 594 | 1.47 | % | |||||||||||||||
| Other borrowings | 243,007 | 9,529 | 5.24 | % | 152,682 | 5,123 | 4.49 | % | |||||||||||||||
| Total interest-bearing liabilities | $ | 3,562,855 | 62,867 | 2.36 | % | $ | 3,325,587 | 14,025 | 0.56 | % | |||||||||||||
| Net interest income | $ | 119,551 | $ | 120,799 | |||||||||||||||||||
| Interest rate spread | 2.89 | % | 3.30 | % | |||||||||||||||||||
| Net interest margin (2) | 3.44 | % | 3.46 | % | |||||||||||||||||||
| (1) Average loan balances include nonaccrual loans. | |||||||||||||||||||||||
| (2) Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets for the period. | |||||||||||||||||||||||
| (3) Tax exempt income is not included in the above table on a tax-equivalent basis. | |||||||||||||||||||||||
| (4) Actual unrounded values are used to calculate the reported yield or rate disclosed. Accordingly, recalculations using the amounts in thousands as disclosed in this report may not produce the same amounts. | |||||||||||||||||||||||
| TABLE 6. QUARTER-TO-DATE NET INTEREST INCOME ANALYSIS (Unaudited) (Dollars in thousands) | |||||||||||||||||||||||
| For the three months ended | For the three months ended | ||||||||||||||||||||||
| September 30, 2023 | September 30, 2022 | ||||||||||||||||||||||
| Average Outstanding Balance | Interest Income/ Expense | Average Yield/Rate(3)(4) | Average Outstanding Balance | Interest Income/ Expense | Average Yield/Rate(3)(4) | ||||||||||||||||||
| Interest-earning assets | |||||||||||||||||||||||
| Loans (1) | |||||||||||||||||||||||
| Commercial and industrial | $ | 573,039 | $ | 10,984 | 7.60 | % | $ | 575,149 | $ | 7,750 | 5.35 | % | |||||||||||
| Commercial real estate | 1,253,362 | 20,824 | 6.59 | % | 1,307,244 | 18,023 | 5.47 | % | |||||||||||||||
| Real estate construction | 480,355 | 9,838 | 8.13 | % | 360,579 | 4,847 | 5.33 | % | |||||||||||||||
| Residential real estate | 564,138 | 6,085 | 4.28 | % | 582,938 | 5,464 | 3.72 | % | |||||||||||||||
| Agricultural real estate | 203,399 | 3,898 | 7.60 | % | 200,534 | 2,740 | 5.42 | % | |||||||||||||||
| Agricultural | 99,773 | 1,856 | 7.38 | % | 113,351 | 1,406 | 4.92 | % | |||||||||||||||
| Consumer | 107,417 | 1,667 | 6.16 | % | 101,203 | 1,325 | 5.20 | % | |||||||||||||||
| Total loans | 3,281,483 | 55,152 | 6.67 | % | 3,240,998 | 41,555 | 5.09 | % | |||||||||||||||
| Securities | |||||||||||||||||||||||
| Taxable securities | 1,027,889 | 5,696 | 2.20 | % | 1,164,697 | 5,792 | 1.97 | % | |||||||||||||||
| Nontaxable securities | 58,016 | 369 | 2.52 | % | 107,717 | 687 | 2.53 | % | |||||||||||||||
| Total securities | 1,085,905 | 6,065 | 2.22 | % | 1,272,414 | 6,479 | 2.02 | % | |||||||||||||||
| Federal funds sold and other | 267,996 | 3,822 | 5.66 | % | 89,156 | 514 | 2.29 | % | |||||||||||||||
| Total interest-earning assets | $ | 4,635,384 | 65,039 | 5.57 | % | $ | 4,602,568 | 48,548 | 4.18 | % | |||||||||||||
| Interest-bearing liabilities | |||||||||||||||||||||||
| Demand, savings and money market deposits | $ | 2,423,380 | 13,331 | 2.18 | % | $ | 2,425,824 | 3,118 | 0.51 | % | |||||||||||||
| Time deposits | 782,920 | 6,043 | 3.06 | % | 655,421 | 1,285 | 0.78 | % | |||||||||||||||
| Total interest-bearing deposits | 3,206,300 | 19,374 | 2.40 | % | 3,081,245 | 4,403 | 0.57 | % | |||||||||||||||
| FHLB advances | 100,000 | 968 | 3.84 | % | 71,415 | 409 | 2.27 | % | |||||||||||||||
| Other borrowings | 285,125 | 3,685 | 5.13 | % | 150,099 | 1,792 | 4.74 | % | |||||||||||||||
| Total interest-bearing liabilities | $ | 3,591,425 | 24,027 | 2.65 | % | $ | 3,302,759 | 6,604 | 0.79 | % | |||||||||||||
| Net interest income | $ | 41,012 | $ | 41,944 | |||||||||||||||||||
| Interest rate spread | 2.92 | % | 3.39 | % | |||||||||||||||||||
| Net interest margin (2) | 3.51 | % | 3.62 | % | |||||||||||||||||||
| (1) Average loan balances include nonaccrual loans. | |||||||||||||||||||||||
| (2) Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets for the period. | |||||||||||||||||||||||
| (3) Tax exempt income is not included in the above table on a tax-equivalent basis. | |||||||||||||||||||||||
| (4) Actual unrounded values are used to calculate the reported yield or rate disclosed. Accordingly, recalculations using the amounts in thousands as disclosed in this report may not produce the same amounts. | |||||||||||||||||||||||
| TABLE 7. QUARTER-OVER-QUARTER NET INTEREST INCOME ANALYSIS (Unaudited) (Dollars in thousands) | |||||||||||||||||||||||
| For the three months ended | For the three months ended | ||||||||||||||||||||||
| September 30, 2023 | June 30, 2023 | ||||||||||||||||||||||
| Average Outstanding Balance | Interest Income/ Expense | Average Yield/Rate(3)(4) | Average Outstanding Balance | Interest Income/ Expense | Average Yield/Rate(3)(4) | ||||||||||||||||||
| Interest-earning assets | |||||||||||||||||||||||
| Loans (1) | |||||||||||||||||||||||
| Commercial and industrial | $ | 573,039 | $ | 10,984 | 7.60 | % | $ | 590,634 | $ | 10,885 | 7.39 | % | |||||||||||
| Commercial real estate | 1,253,362 | 20,824 | 6.59 | % | 1,303,520 | 20,875 | 6.42 | % | |||||||||||||||
| Real estate construction | 480,355 | 9,838 | 8.13 | % | 465,231 | 8,231 | 7.10 | % | |||||||||||||||
| Residential real estate | 564,138 | 6,085 | 4.28 | % | 567,297 | 6,048 | 4.28 | % | |||||||||||||||
| Agricultural real estate | 203,399 | 3,898 | 7.60 | % | 202,584 | 3,387 | 6.71 | % | |||||||||||||||
| Agricultural | 99,773 | 1,856 | 7.38 | % | 101,333 | 1,704 | 6.74 | % | |||||||||||||||
| Consumer | 107,417 | 1,667 | 6.16 | % | 106,898 | 1,618 | 6.07 | % | |||||||||||||||
| Total loans | 3,281,483 | 55,152 | 6.67 | % | 3,337,497 | 52,748 | 6.34 | % | |||||||||||||||
| Securities | |||||||||||||||||||||||
| Taxable securities | 1,027,889 | 5,696 | 2.20 | % | 1,068,653 | 5,813 | 2.18 | % | |||||||||||||||
| Nontaxable securities | 58,016 | 369 | 2.52 | % | 87,318 | 568 | 2.61 | % | |||||||||||||||
| Total securities | 1,085,905 | 6,065 | 2.22 | % | 1,155,971 | 6,381 | 2.21 | % | |||||||||||||||
| Federal funds sold and other | 267,996 | 3,822 | 5.66 | % | 185,276 | 2,127 | 4.61 | % | |||||||||||||||
| Total interest-earning assets | $ | 4,635,384 | 65,039 | 5.57 | % | $ | 4,678,744 | 61,256 | 5.25 | % | |||||||||||||
| Interest-bearing liabilities | |||||||||||||||||||||||
| Demand savings and money market deposits | $ | 2,423,380 | 13,331 | 2.18 | % | $ | 2,323,685 | 10,503 | 1.81 | % | |||||||||||||
| Time deposits | 782,920 | 6,043 | 3.06 | % | 903,280 | 6,701 | 2.98 | % | |||||||||||||||
| Total interest-bearing deposits | 3,206,300 | 19,374 | 2.40 | % | 3,226,965 | 17,204 | 2.14 | % | |||||||||||||||
| FHLB advances | 100,000 | 968 | 3.84 | % | 101,845 | 953 | 3.75 | % | |||||||||||||||
| Other borrowings | 285,125 | 3,685 | 5.13 | % | 283,659 | 3,670 | 5.19 | % | |||||||||||||||
| Total interest-bearing liabilities | $ | 3,591,425 | 24,027 | 2.65 | % | $ | 3,612,469 | 21,827 | 2.42 | % | |||||||||||||
| Net interest income | $ | 41,012 | $ | 39,429 | |||||||||||||||||||
| Interest rate spread | 2.92 | % | 2.83 | % | |||||||||||||||||||
| Net interest margin (2) | 3.51 | % | 3.38 | % | |||||||||||||||||||
| (1) Average loan balances include nonaccrual loans. | |||||||||||||||||||||||
| (2) Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets for the period. | |||||||||||||||||||||||
| (3) Tax exempt income is not included in the above table on a tax-equivalent basis. | |||||||||||||||||||||||
| (4) Actual unrounded values are used to calculate the reported yield or rate disclosed. Accordingly, recalculations using the amounts in thousands as disclosed in this report may not produce the same amounts. | |||||||||||||||||||||||
| TABLE 8. NON-GAAP FINANCIAL MEASURES (Unaudited) | ||||||||||||||||||||
| (Dollars in thousands, except per share data) | ||||||||||||||||||||
| As of and for the three months ended | ||||||||||||||||||||
| September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
| 2023 | 2023 | 2023 | 2022 | 2022 | ||||||||||||||||
| Total stockholders' equity | $ | 418,130 | $ | 418,435 | $ | 425,123 | $ | 410,058 | $ | 395,806 | ||||||||||
| Less: goodwill | 53,101 | 53,101 | 53,101 | 53,101 | 53,101 | |||||||||||||||
| Less: core deposit intangibles, net | 7,961 | 8,760 | 9,678 | 10,596 | 11,598 | |||||||||||||||
| Less: mortgage servicing rights, net | 100 | 126 | 151 | 176 | 201 | |||||||||||||||
| Less: naming rights, net | 1,011 | 1,022 | 1,033 | 1,044 | 1,054 | |||||||||||||||
| Tangible common equity | $ | 355,957 | $ | 355,426 | $ | 361,160 | $ | 345,141 | $ | 329,852 | ||||||||||
| Common shares outstanding at period end | 15,413,064 | 15,396,739 | 15,730,257 | 15,930,112 | 16,017,834 | |||||||||||||||
| Diluted common shares outstanding at period end | 15,500,749 | 15,468,319 | 15,822,536 | 16,163,253 | 16,225,591 | |||||||||||||||
| Book value per common share | $ | 27.13 | $ | 27.18 | $ | 27.03 | $ | 25.74 | $ | 24.71 | ||||||||||
| Tangible book value per common share | $ | 23.09 | $ | 23.08 | $ | 22.96 | $ | 21.67 | $ | 20.59 | ||||||||||
| Tangible book value per diluted common share | $ | 22.96 | $ | 22.98 | $ | 22.83 | $ | 21.35 | $ | 20.33 | ||||||||||
| Total assets | $ | 4,945,267 | $ | 5,094,883 | $ | 5,156,716 | $ | 4,981,651 | $ | 5,000,415 | ||||||||||
| Less: goodwill | 53,101 | 53,101 | 53,101 | 53,101 | 53,101 | |||||||||||||||
| Less: core deposit intangibles, net | 7,961 | 8,760 | 9,678 | 10,596 | 11,598 | |||||||||||||||
| Less: mortgage servicing rights, net | 100 | 126 | 151 | 176 | 201 | |||||||||||||||
| Less: naming rights, net | 1,011 | 1,022 | 1,033 | 1,044 | 1,054 | |||||||||||||||
| Tangible assets | $ | 4,883,094 | $ | 5,031,874 | $ | 5,092,753 | $ | 4,916,734 | $ | 4,934,461 | ||||||||||
| Total stockholders' equity to total assets | 8.46 | % | 8.21 | % | 8.24 | % | 8.23 | % | 7.92 | % | ||||||||||
| Tangible common equity to tangible assets | 7.29 | % | 7.06 | % | 7.09 | % | 7.02 | % | 6.68 | % | ||||||||||
| Total average stockholders' equity | $ | 426,260 | $ | 424,862 | $ | 420,500 | $ | 398,270 | $ | 436,191 | ||||||||||
| Less: average intangible assets | 62,635 | 63,453 | 64,447 | 65,450 | 66,445 | |||||||||||||||
| Average tangible common equity | $ | 363,625 | $ | 361,409 | $ | 356,053 | $ | 332,820 | $ | 369,746 | ||||||||||
| Net income (loss) allocable to common stockholders | $ | 12,341 | $ | 11,456 | $ | 12,323 | $ | 11,608 | $ | 15,171 | ||||||||||
| Add: amortization of intangible assets | 835 | 954 | 954 | 961 | 992 | |||||||||||||||
| Less: tax effect of intangible assets amortization | 175 | 200 | 200 | 202 | 208 | |||||||||||||||
| Adjusted net income (loss) allocable to common stockholders | $ | 13,001 | $ | 12,210 | $ | 13,077 | $ | 12,367 | $ | 15,955 | ||||||||||
| Return on total average stockholders' equity (ROAE) annualized | 11.49 | % | 10.82 | % | 11.89 | % | 11.56 | % | 13.80 | % | ||||||||||
| Return on average tangible common equity (ROATCE) annualized | 14.18 | % | 13.55 | % | 14.89 | % | 14.74 | % | 17.12 | % | ||||||||||
| Non-interest expense | $ | 34,244 | $ | 33,130 | $ | 33,229 | $ | 35,248 | $ | 32,236 | ||||||||||
| Less: merger expense | — | — | — | 68 | 115 | |||||||||||||||
| Adjusted non-interest expense | $ | 34,244 | $ | 33,130 | $ | 33,229 | $ | 35,180 | $ | 32,121 | ||||||||||
| Net interest income | $ | 41,012 | $ | 39,429 | $ | 39,110 | $ | 42,031 | $ | 41,944 | ||||||||||
| Non-interest income | 8,735 | 6,950 | 8,600 | 8,330 | 8,969 | |||||||||||||||
| Less: net gain on acquisition and branch sales | — | — | — | 422 | — | |||||||||||||||
| Less: net gains (losses) from securities transactions | (1 | ) | (1,322 | ) | 32 | 14 | (17 | ) | ||||||||||||
| Adjusted non-interest income | $ | 8,736 | $ | 8,272 | $ | 8,568 | $ | 7,894 | $ | 8,986 | ||||||||||
| Net interest income plus adjusted non-interest income | $ | 49,748 | $ | 47,701 | $ | 47,678 | $ | 49,925 | $ | 50,930 | ||||||||||
| Non-interest expense to net interest income plus non-interest income | 68.84 | % | 71.43 | % | 69.65 | % | 69.99 | % | 63.32 | % | ||||||||||
| Efficiency ratio | 68.83 | % | 69.45 | % | 69.69 | % | 70.47 | % | 63.07 | % | ||||||||||
| Net income (loss) allocable to common stockholders | $ | 12,341 | $ | 11,456 | $ | 12,323 | $ | 11,608 | $ | 15,171 | ||||||||||
| Add: income tax provision | 1,932 | 1,495 | 2,524 | 3,654 | 3,642 | |||||||||||||||
| Add: provision (reversal) of credit losses | 1,230 | 298 | (366 | ) | (151 | ) | (136 | ) | ||||||||||||
| Pre-tax, pre-provision income | $ | 15,503 | $ | 13,249 | $ | 14,481 | $ | 15,111 | $ | 18,677 | ||||||||||
| Total average assets | $ | 5,046,179 | $ | 5,064,912 | $ | 4,994,417 | $ | 4,930,231 | $ | 4,988,755 | ||||||||||
| Total average stockholders' equity | $ | 426,620 | $ | 424,862 | $ | 420,500 | $ | 398,270 | $ | 436,191 | ||||||||||
| Return on average assets (ROAA) annualized | 0.97 | % | 0.91 | % | 1.00 | % | 0.93 | % | 1.21 | % | ||||||||||
| Adjusted return on average assets | 1.22 | % | 1.05 | % | 1.18 | % | 1.22 | % | 1.49 | % | ||||||||||
| Adjusted return on average equity | 14.43 | % | 12.51 | % | 13.97 | % | 15.05 | % | 16.99 | % | ||||||||||
