HATTIESBURG, Miss.--(BUSINESS WIRE)-- The First Bancshares, Inc. (“FBMS” or “the Company”) (NASDAQ: FBMS), holding company for The First Bank, (www.thefirstbank.com) reported today net income available to common shareholders for the quarter ended March 31, 2022.
Highlights for the Quarter:
M. Ray “Hoppy” Cole, President and Chief Executive Officer, commented, “The acquisition of Beach Bancorp, Inc. and strong first quarter results are a great start to 2022. Our combination with Beach Bank will provide density and significant additional market share in our northwest Florida region as well as adding the Tampa metro and central Florida markets to our footprint. These markets are some of the most dynamic and fastest growing in the country. Beach Bank has assembled a high quality experienced team of bankers who will accelerate our growth plans and play a major role in building a high performing southeastern community bank franchise.
We are pleased with our first quarter results which included strong loan originations and 4.4% annualized growth quarter over quarter. Our loan pipelines continue to build and activity remains robust across our markets. Our Company is well positioned to benefit from the rising interest rate environment with substantial excess liquidity and an asset/liability mix that should generate margin expansion over the next several quarters.”
Quarterly Earnings
Net income available to common shareholders totaled $16.8 million for the quarter ended March 31, 2022, an increase of $1.0 million, or 6.6%, compared to $15.8 million for the quarter ended December 31, 2021. The Company recognized two non-recurring items during the first quarter 2022, $1.6 million in Bank-Owned Life Insurance (“BOLI”) income from death proceeds and $0.7 million in the form of a financial assistance grant from the U. S. Department of Treasury. The Company also recognized $1.6 million less in PPP loan fee income during the first quarter 2022 as compared to the fourth quarter 2021.
Pre-tax, Pre-provision Operating Earnings
Pre-tax, pre-provision operating earnings (non-GAAP) increased $0.4 million for the quarter ended March 31, 2022 as compared to the quarter ended December 31, 2021. One-time charges of $1.1 million in salaries and employee benefits related to restricted stock expense, incentive accruals and sold vacation were recorded during the quarter ended December 31, 2021.
The Company recorded a negative provision for credit losses of $1.1 million for the quarter ended December 31, 2021 and $0 for the quarter ended March 31, 2022.
Earnings Per Share
For the first quarter of 2022, fully diluted earnings per share were $0.81 compared to $0.75 for the fourth quarter of 2021 and $0.79 for the first quarter of 2021.
Fully diluted earnings per share include the purchase by the Company of 600,000 shares of its common stock during the first quarter of 2022 and 165,623 shares during the first quarter of 2021.
Balance Sheet
Consolidated assets increased $118.7 million to $6.196 billion at March 31, 2022 from $6.077 billion at December 31, 2021. An increase in deposits of $211.0 million during the first quarter 2022 contributed to the increase in consolidated assets.
PPP loans at March 31, 2022 were $19.4 million, a decrease of $21.7 million from December 31, 2021, due to loan forgiveness under the PPP program.
Total loans were $2.970 billion for the quarter ended March 31, 2022, as compared to $2.960 billion for the quarter ended December 31, 2021, and $3.055 billion for the quarter ended March 31, 2021, representing an increase of $10.7 million, or 0.4%, for the sequential quarter comparison, and a decrease of $84.8 million, or 2.8%, for the prior year quarterly comparison. PPP loans totaled $19.4 million for the quarter ended March 31, 2022, $41.1 million for the quarter ended December 31, 2021, and $221.7 million for the quarter ended March 31, 2021.
Excluding the PPP loans, total loans increased $32.4 million, or 1.11% as compared to the quarter ended December 31, 2021, or 4.4% on an annualized basis.
Excluding the PPP loans, total loans increased $117.5 million, or 4.15% as compared to the quarter ended March 31, 2021.
Total deposits were $5.438 billion for the quarter ended March 31, 2022, as compared to $5.227 billion for the quarter ended December 31, 2021, and $4.620 billion for the quarter ended March 31, 2021, representing an increase of $211.0 million, or 4.0%, for the sequential quarter comparison, and an increase of $817.4 million, or 17.7%, for the prior year quarterly comparison. The acquired Cadence branch deposit portfolio contributed $345.2 million to the $817.4 million increase for the prior year quarterly comparison.
Deposits increased $211.0 million, or 4.0% as compared to the quarter ended December 31, 2021 of which $60 million was attributed to the seasonality of public fund deposits with the balance being split between retail and business customers.
Tangible book value decreased to $19.79 at March 31, 2022 from $23.31 at December 31, 2021. This decreased was the result of the repurchase of 600,000 shares of common stock by the Company during the quarter and the change in accumulated other comprehensive income of ($76.8 million) related to the effect of rising interest rates on our investment portfolio.
The Company implemented Deposit Reclassification at the beginning of 2020. This program reclassifies noninterest bearing deposits and NOW deposit balances to money market accounts. This program reduces our reserve balance required at the Federal Reserve Bank of Atlanta, which provides additional funds for liquidity and lending. At March 31, 2022, $837.7 million in noninterest deposit balances and $1.034 billion in NOW deposit accounts were reclassified as money market accounts.
Asset Quality
Nonperforming assets totaled $27.6 million at March 31, 2022, a decrease of $3.1 million compared to $30.6 million at December 31, 2021 and a decrease of $9.3 million compared to $36.8 million at March 31, 2021. Nonaccrual loans decreased $3.3 million as compared to December 31, 2021 and decreased $5.2 million as compared to March 31, 2021.
The ratio of the allowance for credit losses (ACL) to total loans was 1.06% at March 31, 2022, 1.04% at December 31, 2021 and 1.07% at March 31, 2021. The ratio of annualized net charge-offs (recoveries) to total loans was (0.12%) for the quarter ended March 31, 2022 compared to 0.03% for the quarter ended December 31, 2021 and 0.47% for the quarter ended March 31, 2021.
First Quarter 2022 vs Fourth Quarter 2021 Earnings Comparison
Net income available to common shareholders for the first quarter of 2022 increased $1.0 million to $16.8 million compared to $15.8 million for the fourth quarter of 2021.
Net interest income for the first quarter of 2022 was $38.6 million as compared to $39.8 million for the fourth quarter of 2021, a decrease of $1.2 million which is primarily attributed to a decrease in PPP loan fees of $1.6 million. FTE net interest income (non-GAAP) decreased $0.9 million to $39.5 million from $40.4 million in sequential-quarter comparison. First quarter 2022 FTE net interest margin (non-GAAP) of 2.78% included 5 basis points related to purchase accounting adjustments compared to 3.14% for the fourth quarter in 2021, which included 7 basis points related to purchase accounting adjustments. Excluding the purchase accounting adjustments, the core net interest margin (non-GAAP) decreased 34 basis points in sequential quarter comparison primarily due to the excess liquidity associated with the Cadence branch acquisition late in the 4th quarter of 2021, a decrease in PPP fees and an increased interest bearing deposit liabilities.
Investment securities totaled $1.986 billion, or 32.1% of total assets at March 31, 2022, compared to $1.774 billion, or 29.2% of total assets at December 31, 2021. The average balance of investment securities increased $333.0 million in sequential-quarter comparison. The average tax equivalent yield on investment securities (non-GAAP) increased 1 basis point to 1.98% from 1.97% in sequential-quarter comparison. The investment portfolio had a net unrealized loss of $92.2 million at March 31, 2022 as compared to a net unrealized gain of $10.7 million at December 31, 2021.
The FTE average yield on all earning assets (non-GAAP) decreased in sequential-quarter comparison from 3.46% to 3.07%. Interest expense on average interest bearing liabilities decreased 3 basis points from 0.35% for the fourth quarter of 2021 to 0.32% for the first quarter of 2022. Cost of all deposits averaged 17 basis points for the first quarter of 2022 compared to 19 basis points for the fourth quarter of 2021.
Non-interest income increased $1.6 million to $11.2 million in the sequential-quarter comparison.
Non-interest expense for the first quarter of 2022 was $28.6 million compared to $30.8 million for the fourth quarter of 2021, a decrease of $2.2 million, largely attributed to the decrease in acquisition charges and charter conversion expenses of $1.2 million. Fourth quarter 2021 reflected one-time charges of $1.1 million in salaries and employee benefits related to restricted stock expense, incentive accruals and sold vacation.
First Quarter 2022 vs. First Quarter 2021 Earnings Comparison
Net income available to common shareholders for the first quarter of 2022 totaled $16.8 million compared to $16.6 million for the first quarter of 2021, an increase of $0.2 million or 1.1%.
Net interest income for the first quarter of 2022 was $38.6 million, a decrease of $0.6 million or 1.5% when compared to the first quarter of 2021. Fully tax equivalent (“FTE”) net interest income (non-GAAP) totaled $39.5 million and $39.9 million for the first quarter of 2022 and 2021, respectively. Purchase accounting adjustments decreased $0.3 million for the first quarter comparisons. First quarter of 2022 FTE net interest margin (non-GAAP) was 2.78% which included 5 basis points related to purchase accounting adjustments compared to 3.34% for the same quarter in 2021, which included 9 basis points related to purchase accounting adjustments. Excluding the purchase accounting adjustments, the core net interest margin (non-GAAP) decreased 52 basis points in prior year quarterly comparison.
Non-interest income increased $1.7 million for the first quarter of 2022 as compared to the first quarter of 2021. This increase consisted of $0.8 million in additional income related to service charges on deposit accounts and interchange fees. Two non-recurring items were recorded during the first quarter 2022, $1.6 million in BOLI income death proceeds and $0.7 million in the form of a financial assistance grant from the U.S. Department of Treasury. These increases were offset by a decrease in mortgage income of $1.9 million in prior year quarterly comparison.
First quarter 2022 non-interest expense was $28.6 million, an increase of $1.3 million, or 4.9% as compared to the first quarter of 2021. Charges related to the acquisition of the Cadence branches and charter conversion accounted for $0.4 million. Charges related to the ongoing operations of the Cadence branches totaled $0.7 million for the first quarter of 2022.
Investment securities totaled $1.986 billion, or 32.1% of total assets at March 31, 2022, compared to $1.157 billion, or 21.3% of total assets at March 31, 2021. For the first quarter of 2022 compared to the first quarter of 2021, the average balance of investment securities increased $830.4 million. The average tax equivalent yield on investment securities (non-GAAP) decreased 34 basis points to 1.98% from 2.32% in the prior year quarterly comparison. The investment portfolio had a net unrealized loss of $92.2 million at March 31, 2022 as compared to a net unrealized gain of $21.7 million at March 31, 2021.
The FTE average yield on all earning assets (non-GAAP) decreased 77 basis points in prior year quarterly comparison, from 3.84% for the first quarter of 2021 to 3.07% for the first quarter of 2022. Interest expense on average interest bearing liabilities decreased 22 basis points from 0.54% for the first quarter of 2021 to 0.32% for the first quarter of 2022. Cost of all deposits averaged 17 basis points for the first quarter of 2022 compared to 36 basis points for the first quarter of 2021.
Declaration of Cash Dividend
The Company announced that its Board of Directors declared a cash dividend of $0.18, a 6% increase over previous quarter, per share to be paid on its common stock on May 25, 2022 to shareholders of record as of the close of business on May 10, 2022.
Conference Call
The Company will host a conference call for analysts and investors to discuss the Company’s financial results and the announced acquisition of Beach Bancorp, Inc. at 2:00 p.m. Central Time on Wednesday, April 27, 2022. Investors and analysts may call in (toll-free) by dialing (844) 298-9819 (if located in the United States) or +1 2132179444 (if located outside the United States). The conference ID is 7097033.
An audio archive of the conference call along with the transcript will be available within 24-48 hours after the call and placed in the Investor Relations section of our website.
About The First Bancshares, Inc.
The First Bancshares, Inc., headquartered in Hattiesburg, Mississippi, is the parent company of The First Bank (“The First”). Founded in 1996, The First has operations in Mississippi, Louisiana, Alabama, Florida and Georgia. The Company’s stock is traded on the NASDAQ Global Market under the symbol FBMS. Information is available on the Company’s website: www.thefirstbank.com.
Non-GAAP Financial Measures
Our accounting and reporting policies conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP measures are used by management to supplement the evaluation of our performance. This press release includes pre-tax, pre-provision operating earnings, FTE net interest income, FTE net interest margin, core net interest margin, average tax equivalent yield on investment securities, FTE average yield on all earning assets, total tangible common equity, tangible book value per common share and certain ratios derived from these non-GAAP financial measures. The Company believes that the non-GAAP financial measures included in this press release allow management and investors to understand and compare results in a more consistent manner for the periods presented in this press release. Non-GAAP financial measures should be considered supplemental and not a substitute for the Company’s results reported in accordance with GAAP for the periods presented, and other bank holding companies may define or calculate these measures differently. These non-GAAP financial measures should not be considered in isolation and do not purport to be an alternative to net income, earnings per share, net interest income, book value or other GAAP financial measures as a measure of operating performance. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measure is provided in this press release following the Condensed Consolidated Financial Information (unaudited).
Additional Information about the Merger and Where to Find It
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities, or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. The Company will file with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 for the proposed merger, containing a proxy statement of Beach Bancorp, Inc. and a prospectus of the Company. The Company will also file other documents with the SEC with respect to the proposed merger, pursuant to SEC reporting requirements. A definitive proxy statement/prospectus will be mailed to shareholders of Beach Bancorp, Inc. Investors and security holders of the Company and Beach Bancorp, Inc. are urged to read the entire proxy statement/prospectus and other documents that will be filed with the SEC carefully and in their entirety when they become available because they will contain important information about the Company, Beach Bancorp, Inc., and the proposed merger transactions. Investors and security holders will be able to obtain free copies of the registration statement and the proxy statement/prospectus (when available) and other documents filed with the SEC by the Company through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed with the SEC by the Company will be available free of charge on the Company’s internet website or by contacting the Company.
The Company and Beach Bancorp, Inc., and their respective directors and executive officers and other members of management and employees, may be considered participants in the solicitation of proxies in connection with the proposed transaction. Information about the directors and executive officers of the Company is set forth in its proxy statement for its 2022 annual meeting of shareholders, filed with the SEC on April 6, 2022, and its Current Reports on Form 8-K. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC when they become available.
Forward Looking Statements
This news release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
All statements other than statements of historical fact are forward-looking statements. Such statements can generally be identified by such words as “believes,” “anticipates,” “expects,” “may,” “will,” “assumes,” “should,” “predicts,” “could,” “would,” “intends,” “targets,” “estimates,” “projects,” “plans,” “potential,” “positioned” and other similar words and expressions of the future or otherwise regarding the outlook for the Company’s future business and financial performance and/or the performance of the banking industry and economy in general. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risk and uncertainties which may cause the actual results, performance or achievements of the Company to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. Factors that might cause such differences include, but are not limited to: (1) competitive pressures among financial institutions increasing significantly; (2) changes in economic or political conditions, either nationally or locally, particularly in areas in which the Company conducts operations; (3) interest rate risk; (4) changes in applicable laws, rules, or regulations; (5) risks related to the Company’s recently completed acquisitions, including that the anticipated benefits from the recently completed acquisitions are not realized in the time frame anticipated or at all as a result of changes in general economic and market conditions or other unexpected factors or events; (6) changes in management’s plans for the future; (7) credit risk associated with our lending activities; changes in interest rates, loan demand, real estate values, or competition; (8) changes in accounting principles, policies, or guidelines; (9) adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company’s participation in and execution of government programs related to the COVID-19 pandemic and related variants; (10) the continued impact of the COVID-19 pandemic and related variants on the Company’s assets, business, cash flows, financial condition, liquidity, prospects and results of operations; (11) higher inflation and its impacts; (12) the effects of war or other conflicts including the impacts relating to or resulting from Russia’s military action in Ukraine; and (13) other general competitive, economic, political, and market factors, including those affecting our business, operations, pricing, products, or services.
Statements about the potential effects of the COVID-19 pandemic and related variants on the Company’s assets, business, liquidity, financial condition, prospects, and results of operations may constitute forward-looking statements and are subject to the risks that the actual effects may differ, possibly materially, from what is reflected in these forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the depth, dispersion and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on customers, employees, third parties and the Company.
Risks relating to the proposed Beach Bancorp, Inc. merger (the “Merger”) including, without limitation, (1) the risk that the cost savings and any revenue synergies from the Merger may not be realized or take longer than anticipated to be realized, (2) disruption from the Merger with customers, suppliers, employee or other business partners relationships, (3) the occurrence of any event, change or other circumstances that could give rise to the termination of one or both of the definitive agreement in respect of the Merger, (4) the risk of successful integration of Beach Bancorp, Inc. into the Company, (5) the failure to obtain the necessary approval by the shareholders of Beach Bancorp, Inc., (6) the amount of the costs, fees, expenses and charges related to the Merger, (7) the ability by the Company to obtain required governmental approvals of the Merger, (8) reputational risk and the reaction of each of the companies’ customers, suppliers, employees or other business partners to the Merger, (9) the failure of the closing conditions in the definitive agreements in respect of the Merger to be satisfied, or any unexpected delay in closing of the Merger, (10) the risk that the integration of the operations of Beach Bancorp, Inc. into the operations of the Company will be materially delayed or will be more costly or difficult than expected, (11) the possibility that the Merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events, (12) the dilution caused by the Company’s issuance of additional shares of its common stock in the Merger, and (13) general competitive, economic, political and market conditions. Additional factors which could affect the forward looking statements can be found in the cautionary language included under the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other documents subsequently filed by the Company with the SEC. Consequently, no forward-looking statement can be guaranteed.
These and other factors that could cause results to differ materially from those described in the forward-looking statements, as well as a discussion of the risks and uncertainties that may affect our business, can be found in our Annual Report on Form 10-K and in other filings we make with the Securities and Exchange Commission (“SEC”), which are available on the SEC’s website, http://www.sec.gov. Undue reliance should not be placed on forward-looking statements. The Company disclaims any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments.
FIRST BANCSHARES, INC and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited)
(Dollars in thousands except per share data)
EARNINGS DATA
Quarter Ended 3/31/22
Quarter Ended 12/31/21
Quarter Ended 9/30/21
Quarter Ended 6/30/21
Quarter Ended 3/31/21
Total Interest Income
$
42,741
43,885
44,435
43,238
45,187
Total Interest Expense
4,102
4,128
4,407
5,188
5,958
Net Interest Income
38,639
39,757
40,028
38,050
39,229
Net Interest Income excluding PPP Fee Income
37,643
37,151
37,294
35,750
35,371
FTE net interest income*
39,459
40,425
40,673
38,696
39,884
Provision for credit losses
-
(1,104
)
Non-interest income
11,157
9,593
9,586
8,822
9,472
Non-interest expense
28,590
30,789
29,053
27,452
27,264
Earnings before income taxes
21,206
19,665
20,561
19,420
21,437
Income tax expense
4,377
3,874
4,429
3,820
4,793
Net income available to common shareholders
16,829
15,791
16,132
15,600
16,644
PER COMMON SHARE DATA
Basic earnings per share
0.81
0.75
0.77
0.74
0.79
Diluted earnings per share
0.76
Diluted earnings per share, operating*
0.72
Quarterly dividends per share
.17
.16
.15
.14
.13
Book value per common share at end of period
28.82
32.17
31.81
31.40
30.64
Tangible book value per common share at period end*
19.79
23.31
23.03
22.57
21.76
Market price at end of period
33.66
38.62
38.78
37.43
36.61
Shares outstanding at period end
20,484,830
21,019,037
21,019,897
21,020,723
21,018,744
Weighted average shares outstanding:
Basic
20,697,946
21,020,768
21,020,128
21,018,772
21,009,088
Diluted
20,846,997
21,175,323
21,211,716
21,207,660
21,200,558
AVERAGE BALANCE SHEET DATA
Total assets
6,202,669
5,664,336
5,504,107
5,458,531
5,337,264
Loans and leases
2,945,877
2,956,657
2,983,771
3,042,785
3,097,145
Total deposits
5,361,480
4,814,945
4,665,914
4,629,176
4,410,288
Total common equity
666,561
672,121
664,594
647,850
644,923
Total tangible common equity*
480,922
500,639
479,540
461,743
457,775
SELECTED RATIOS
Annualized return on avg assets (ROA)
1.09
%
1.12
1.17
1.14
1.25
Annualized return on avg assets, operating*
0.97
1.13
Annualized pre-tax, pre-provision, operating*
1.24
1.33
1.49
1.42
1.61
Annualized return on avg common equity, operating*
8.99
9.53
9.70
9.63
10.32
Annualized return on avg tangible common equity, oper*
12.46
12.80
13.44
13.51
14.54
Average loans to average deposits
54.95
61.41
63.95
65.73
70.23
FTE Net Interest Margin*
2.78
3.14
3.25
3.34
Efficiency Ratio
56.48
61.56
57.81
57.77
55.24
Efficiency Ratio, operating*
58.37
59.91
56.62
*See reconciliation of Non-GAAP financial measures
CREDIT QUALITY
Allowance for credit losses (ACL) as a % of total loans
1.06
1.04
1.07
Nonperforming assets to tangible equity + ACL
6.31
5.88
5.43
7.30
7.52
Nonperforming assets to total loans + OREO
0.93
1.03
0.95
1.22
1.20
Annualized QTD net charge-offs (recoveries) to total loans
0.12
0.03
0.005
0.47
(in thousands)
BALANCE SHEET
Mar 31, 2022
Dec 31, 2021
Sept 30, 2021
June 30, 2021
Mar 31, 2021
Assets
Cash and cash equivalents
802,613
919,713
657,296
762,486
813,257
Securities available for sale
1,591,677
1,751,832
1,463,255
1,280,761
1,135,189
Securities held to maturity
372,062
Other investments
22,226
22,225
22,137
Total investment securities
1,985,965
1,774,058
1,485,480
1,302,986
1,157,326
Loans held for sale
8,213
7,678
8,540
6,000
15,119
Total loans
2,970,246
2,959,553
2,960,919
3,036,732
3,055,093
Allowance for credit losses
(31,620
(30,742
(32,418
(32,457
(32,663
Loans, net
2,938,626
2,928,811
2,928,501
3,004,275
3,022,430
Premises and equipment
131,813
132,448
123,594
120,667
121,934
Other Real Estate Owned
2,835
2,565
2,580
3,529
5,769
Goodwill and other intangibles
185,104
186,171
184,545
185,597
186,648
Other assets
140,926
125,970
121,348
124,193
120,315
6,196,095
6,077,414
5,511,884
5,509,733
5,442,798
Liabilities and Shareholders’ Equity
Non-interest bearing deposits^
810,723
756,118
596,126
632,485
Interest-bearing deposits
4,627,014
4,470,666
4,076,415
3,991,898
3,987,812
5,437,737
5,226,784
4,672,541
4,673,912
4,620,297
Borrowings
4,466
Subordinated debentures
144,801
144,726
144,650
144,611
144,572
Other liabilities
23,117
29,732
26,010
31,158
29,514
Total liabilities
5,605,655
5,401,242
4,843,201
4,849,681
4,798,849
Total shareholders’ equity
590,440
676,172
668,683
660,052
643,949
Total liabilities and shareholders’ equity
(in thousands except per share data)
EARNINGS STATEMENT
Three Months Ended
3/31/22
12/31/21
9/30/21
6/30/21
3/31/21
Interest Income:
Loans, including fees
33,354
36,035
36,374
36,283
38,587
Investment securities
8,574
7,032
6,938
5,925
5,526
Accretion of purchase accounting adjustments
800
1,106
992
1,026
Other interest income
13
18
17
38
48
Total interest income
Interest Expense:
Deposits
2,302
2,371
2,649
3,375
3,910
52
288
1,819
1,818
1,821
(19
(61
(60
Total interest expense
Net interest income
Net interest income after provision for credit losses
40,861
Non-interest Income:
Service charges on deposit accounts
2,040
1,901
1,846
1,756
1,761
Mortgage Income
1,230
1,556
1,732
2,372
3,162
Interchange Fee Income
3,197
3,029
2,744
3,145
2,644
Gain (Loss) on securities, net
(3
36
11
77
20
Financial Assistance Award/Bank Enterprise Award/RRP Grant
702
1,826
Bargain Purchase Gain and (Loss) on Sale of Land
1,300
(397
BOLI income from death proceeds
1,630
Other charges and fees
2,361
1,771
1,824
1,472
1,885
Total non-interest income
Non-interest expense:
Salaries and employee benefits
16,799
17,519
16,246
16,036
16,054
Occupancy expense
3,876
3,948
3,922
3,813
3,879
FDIC/OCC premiums
566
550
532
499
494
Marketing
86
113
78
39
160
Amortization of core deposit intangibles
1,064
982
1,052
Other professional services
563
1,282
934
1,049
Acquisition and charter conversion charges
408
1,602
5
Other non-interest expense
5,228
6,284
4,964
4,691
Total Non-interest expense
Diluted earnings per common share
Diluted earnings per common share, operating*
Year to Date
2022
2021
Amortization of purchase accounting adjustments
Gain (loss) on securities, net
Bargain Purchase Gain and Gain/(loss) on Sale of Land
Acquisition & charter conversion charges
(Dollars in thousands)
COMPOSITION OF LOANS
Percent of Total
Commercial, financial and agricultural
364,702
12.2
375,379
426,342
485,134
532,122
17.3
Real estate – construction
387,290
13.0
364,075
361,732
341,864
304,457
9.9
Real estate – commercial
1,249,203
42.0
1,242,529
1,206,267
1,215,103
1,217,505
39.7
Real estate – residential
911,568
30.6
916,179
910,618
935,827
944,032
30.7
Lease Financing Receivable
2,409
0.1
2,556
2,889
3,291
3,382
Obligations of States & subdivisions
15,842
0.5
16,765
15,790
16,489
14,996
Consumer
39,233
1.3
42,070
37,281
39,024
38,599
0.3
2,978,460
100
2,967,231
2,969,459
3,042,732
3,070,212
COMPOSITION OF DEPOSITS
Mar 31 2022
Non-interest bearing^
14.9
682,014
13.7
NOW and other^
851,276
15.7
739,153
670,888
704,034
702,766
15.2
Money Market/Savings^
3,209,016
59.0
3,146,904
2,896,140
2,758,957
2,734,873
59.2
Time Deposits of less than $250,000
424,183
7.8
445,879
390,289
404,437
419,556
9.1
Time Deposits of $250,000 or more
142,539
2.6
138,730
119,098
124,470
130,617
2.8
Total Deposits
Deposits Without Reclassification^
Non-interest bearing
1,648,451
30.3
1,550,381
1,424,208
1,393,724
1,328,239
28.8
NOW and other
1,885,145
34.7
1,771,510
1,524,935
1,541,915
1,562,119
33.8
Money Market/Savings
1,337,419
24.6
1,320,284
1,214,011
1,209,366
1,179,749
25.5
ASSET QUALITY DATA
Nonaccrual loans
24,736
28,013
25,012
27,625
29,981
Loans past due 90 days and over
45
456
5,834
1,079
Total nonperforming loans
28,058
25,468
33,459
31,060
Other real estate owned
2,834
Total nonperforming assets
27,570
30,623
28,048
36,988
36,829
Nonperforming assets to total assets
0.44
0.50
0.51
0.67
0.68
ACL to nonperforming loans
127.83
109.57
127.29
97.01
105.16
ACL to total loans
Qtr-to-date net charge-offs (recoveries)
(879
220
207
3,553
Annualized QTD net chg-offs (recs) to loans
(0.12
%)
1,413,523
6,152
1.74
1,166,432
5,059
1.73
986,325
5,033
2.04
853,180
4,017
1.88
699,585
3,591
2.05
483,780
3,242
2.68
397,906
2,641
2.65
377,610
2,550
2.70
367,074
2,554
367,322
2,590
2.82
1,897,303
9,394
1.98
1,564,338
7,700
1.97
1,363,935
7,583
2.22
1,220,254
6,571
2.15
1,066,907
6,181
2.32
825,877
0.01
634,541
657,387
661,069
0.02
614,283
34,154
4.64
36,835
4.98
37,480
5.02
37,275
4.90
39,613
5.12
5,669,057
43,561
3.07
5,155,536
44,553
3.46
5,005,093
45,080
3.60
4,924,108
43,884
3.56
4,778,335
45,842
3.84
533,612
508,800
506,134
534,423
558,929
5,511,227
5,021,657
2,283
0.18
4,537,958
2,310
0.20
4,422,690
2,588
0.23
4,374,372
3,315
0.30
4,172,326
3,849
0.37
0.00
206
3,355
6.20
100,143
1.15
144,759
5.03
144,684
144,630
144,591
5.04
144,590
5,166,416
0.32
4,682,642
0.35
4,567,526
0.39
4,522,318
0.46
4,417,059
0.54
369,692
309,573
279,107
288,363
275,282
2.75
3.10
3.22
3.11
3.30
2.73
3.15
3.05
Reconciliation of Non-GAAP Financial Measures (unaudited)
Per Common Share Data
Book value per common share
Effect of intangible assets per share
9.03
8.86
8.78
8.83
8.88
Tangible book value per common share
Effect of acquisition and charter conversion charges
0.07
Tax on acquisition and charter conversion charges
(0.02
Effect of bargain purchase gain and loss on sale of fixed assets
(0.06
Tax on loss on sale of fixed assets
Effect of Treasury awards
(0.03
(0.09
Tax on Treasury awards
.02
(0.08
Effect on Contributions related to Treasury awards
.07
Tax on Contributions related to Treasury awards
Diluted earnings per share, operating
(103
Bargain purchase gain and loss on sale of fixed assets
Treasury awards
(702
178
(1,630
Contributions related to Treasury awards
Net earnings available to common shareholders, operating
14,980
Average Balance Sheet Data
Total average assets
A
Total average earning assets
B
Common Equity
C
Less intangible assets
185,639
171,482
185,054
186,107
187,148
Total Tangible common equity
D
Net Interest Income Fully Tax Equivalent
E
Tax-exempt investment income
(2,422
(1,973
(1,905
(1,908
(1,935
Taxable investment income
F
Annualized Net Interest Margin
E/B
3.08
3.20
3.09
3.28
Annualized Net Interest Margin, Fully Tax Equivalent
F/B
Total Interest Income, Fully Tax Equivalent
G
Yield on Average Earning Assets, Fully Tax Equivalent
G/B
Interest Income Investment Securities, Fully Tax Equivalent
Interest Income Investment Securities
Taxable investment Income
H
Average Investment Securities
I
1,364,431
Yield on Investment Securities, Fully Tax Equivalent
H/I
Core Net Interest Margin
Net interest income (FTE)
Less purchase accounting adjustments
861
1,167
Net interest income, net of purchase accounting adj
J
38,659
39,564
39,506
37,644
38,858
Add average balance of loan valuation discount
3,836
4,353
5,252
6,373
8,480
Avg earning assets, excluding loan valuation discount
K
5,672,893
5,159,889
5,010,345
4,930,481
4,786,815
Core net interest margin
J/K
Operating Expense
Total non-interest expense
Pre-tax non-operating expenses
(408
(1,602
(1,405
Adjusted Operating Expense
L
28,182
29,187
27,648
Operating Revenue
Net interest income, FTE
Pre-tax non-operating items
(2,331
(1,300
(1,429
Adjusted Operating Revenue
M
48,285
48,718
48,830
47,518
49,356
Efficiency Ratio, operating
L/M
Return Ratios
N
(405
(1
397
329
(100
(1,826
462
Charitable contributions related to Treasury awards
1,400
Tax on charitable contributions related to Treasury awards
(354
O
16,017
16,115
Pre-Tax Pre-Provision Operating Earnings
P
Provision for loan losses
Treasury Awards
Pre-Tax, Pre-Provision Operating Earnings
Q
19,282
18,863
20,537
Annualized return on avg assets
N/A
Annualized return on avg assets, oper
O/A
Annualized pre-tax, pre-provision, oper
Q/A
Annualized return on avg common equity, oper
O/C
Annualized return on avg tangible common equity, operating
O/D
Mortgage Department
Net Interest Income after provision for credit losses
85
97
92
140
Loan fee income
(1,181
(1,171
(995
(1,165
(1,512
(149
(125
(131
(126
Earnings (Loss) before income taxes
(15
357
698
1,189
1,664
M. Ray “Hoppy” Cole Chief Executive Officer Dee Dee Lowery Chief Financial Officer (601) 268-8998