HOUSTON, Oct. 28, 2022 (GLOBE NEWSWIRE) -- (NASDAQ: STEL) The merger of equals between CBTX, Inc. (CBTX) and Allegiance Bancshares, Inc. (Allegiance) became effective as of October 1, 2022, with the combined company renamed Stellar Bancorp, Inc. This press release includes the pre-merger financial results of stand-alone CBTX and stand-alone Allegiance for the periods presented. As such, these financial results do not include the impact of purchase accounting adjustments related to the merger.
Stellar Bancorp, Inc. (Stellar), formerly known as CBTX, reported net income of $12.7 million and diluted earnings per share of $0.52 for the third quarter 2022 compared to net income of $14.4 million and diluted earnings per share of $0.59 for the third quarter 2021. Net income for the nine months ended September 30, 2022 was $35.0 million, or $1.43 per diluted share, compared to $36.1 million, or $1.47 per diluted share, for the nine months ended September 30, 2021.
Allegiance reported net income of $14.3 million and diluted earnings per share of $0.71 for the third quarter 2022 compared to net income of $19.1 million and diluted earnings per share of $0.93 for the third quarter 2021. Net income for the nine months ended September 30, 2022 was $49.4 million, or $2.42 per diluted share, compared to $60.0 million, or $2.95 per diluted share, for the nine months ended September 30, 2021.
Third Quarter 2022 Financial Highlights
- CBTX highlights
- Loans held for investment grew 12.3% (annualized), or $93.5 million, during the third quarter 2022 to $3.13 billion
- Net interest income increased 23.3%, or $8.1 million, compared to the second quarter of 2022
- Tax equivalent net interest margin increased 76 basis points to 4.25% compared to the second quarter of 2022
- Allegiance highlights
- Loans held for investment grew 22.4% (annualized), or $243.1 million, during the third quarter 2022 to $4.59 billion
- Net interest income increased 5.6%, or $3.2 million, compared to the second quarter of 2022
- Tax equivalent net interest margin increased 32 basis points to 3.85% compared to the second quarter of 2022
| CBTX, Inc. | Allegiance Bancshares, Inc. | ||||||||||||||
| 3Q 2022 | 2Q 2022 | 3Q 2022 | 2Q 2022 | ||||||||||||
| (Dollars in thousands, except per share data) | |||||||||||||||
| Net income | $ | 12,747 | $ | 11,707 | $ | 14,286 | $ | 16,437 | |||||||
| Pre-tax, pre-provision income(A) | $ | 17,140 | $ | 14,660 | $ | 19,654 | $ | 22,282 | |||||||
| Earnings per share, diluted | $ | 0.52 | $ | 0.48 | $ | 0.71 | $ | 0.80 | |||||||
| Efficiency ratio(B) | 63.11 | % | 61.84 | % | 69.18 | % | 62.96 | % | |||||||
| Acquisition and merger-related expenses | $ | 5,897 | $ | 1,100 | $ | 10,551 | $ | 1,667 | |||||||
| Adjusted pre-tax, pre-provision income(A)(C) | $ | 23,037 | $ | 15,760 | $ | 30,205 | $ | 23,949 | |||||||
| Adjusted efficiency ratio(A)(C) | 50.42 | % | 58.98 | % | 52.61 | % | 60.19 | % | |||||||
(A) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on pages 11 and 18 of this Earnings Release.
(B) Refer to the calculation of the efficiency ratio on pages 5 and 12 for CBTX and Allegiance, respectively.
(C) Adjusted results exclude the impact of acquisition and merger-related expenses.
"We are proud to have closed the merger between CBTX and Allegiance to become Stellar," said Stellar's Chief Executive Officer Robert R. Franklin, Jr. "Both of our organizations entered this merger from tremendous positions of strength and with great momentum, providing Stellar a solid foundation upon which to build."
"Our teams have worked diligently to ensure a successful integration of these two organizations. Together we are stronger and committed to providing value for our shareholders as we drive purposeful growth, deliver continued personalized service and invest in the communities that we serve," concluded Franklin.
CBTX, Inc. Third Quarter 2022 Results
CBTX's net interest income in the third quarter 2022 increased $11.8 million, or 37.6%, to $43.0 million from $31.2 million for the third quarter 2021 and increased $8.1 million, or 23.3%, from $34.9 million for the second quarter 2022. These increases were primarily due to increased interest income on loans and interest-bearing deposits at other financial institutions as a result of changes in market interest rates and increases in average loans and securities. The net interest margin on a tax equivalent basis increased 103 basis points to 4.25% for the third quarter 2022 from 3.22% for the third quarter 2021 and increased 76 basis points from 3.49% for the second quarter 2022.
Noninterest income for the third quarter 2022 was $3.4 million, a decrease of $2.1 million, or 38.0%, compared to $5.6 million for the third quarter 2021 and a decrease of $97 thousand, or 2.7%, compared to $3.5 million for the second quarter 2022. The decrease in noninterest income of $2.1 million during the three months ended September 30, 2022 compared to the three months ended September 30, 2021, was primarily due to the impact of earnings on bank-owned life insurance and related gains of $1.9 million during the third quarter of 2021.
Noninterest expense for the third quarter 2022 increased $4.9 million, or 20.3%, to $29.3 million from $24.4 million for the third quarter 2021 and increased $5.6 million, or 23.4%, compared to the second quarter of 2022. The increase in noninterest expense for the third quarter of 2022 compared to the third quarter of 2021, was primarily due to acquisition and merger-related expenses associated with the merger with Allegiance, partially offset by a decrease in professional and director fees, primarily related to BSA/AML compliance matters and legal fees incurred during the third quarter of 2021. The increase in noninterest expense for the third quarter of 2022 compared to the second quarter of 2022 was primarily due to greater acquisition and merger-related expenses.
CBTX's efficiency ratio decreased to 63.11% for the third quarter 2022 compared to 66.21% for the third quarter 2021 and increased from 61.84% for the second quarter 2022. Third quarter 2022 annualized returns on average assets, average equity and average tangible equity were 1.16%, 9.40% and 11.15%, respectively, compared to 1.37%, 10.15% and 11.95% for the third quarter 2021. Annualized returns on average assets, average equity and average tangible equity for the second quarter 2022 were 1.08%, 8.75% and 10.38%, respectively. Return on average tangible equity is a non-GAAP measure. Please refer to the non-GAAP reconciliation on page 11.
Financial Condition
CBTX's total assets at September 30, 2022 increased $62.7 million, or 1.5%, to $4.27 billion compared to $4.21 billion at September 30, 2021 and decreased $50.5 million, or 4.6% (annualized), compared to $4.32 billion at June 30, 2022.
Total gross loans at September 30, 2022 increased $517.7 million, or 19.8%, to $3.13 billion compared to $2.61 billion at September 30, 2021, primarily due to organic loan growth, and increased $93.5 million, or 12.3% (annualized) compared to $3.03 billion at June 30, 2022 due to the increase in organic loans.
Deposits at September 30, 2022 increased $192.1 million, or 5.4%, to $3.72 billion compared to $3.53 billion at September 30, 2021 and decreased $32.9 million, or 3.5% (annualized), compared to $3.76 billion at June 30, 2022.
Asset Quality
CBTX's nonperforming assets totaled $22.4 million, or 0.52% of total assets, at September 30, 2022 compared to $20.6 million, or 0.49% of total assets, at September 30, 2021 and $28.3 million, or 0.65% of total assets at June 30, 2022. The allowance for credit losses on loans as a percentage of total loans, excluding loans held for sale, was 1.04% at September 30, 2022, 1.23% at September 30, 2021 and 1.06% at June 30, 2022.
The provision for credit losses for the third quarter 2022 was $1.0 million compared to the recapture of provision for credit losses of $4.9 million for the third quarter 2021 and the provision for credit losses of $126 thousand for the second quarter 2022.
Third quarter 2022 net charge-offs were $33 thousand, or 0.00% (annualized) of average loans, compared to net recoveries of $82 thousand, or 0.01% (annualized) of average loans, for the third quarter 2021 and net recoveries of $166 thousand, or 0.02% (annualized) of average loans, for the second quarter 2022.
Allegiance Bancshares, Inc. Third Quarter 2022 Results
Allegiance's net interest income in the third quarter 2022 increased $2.5 million, or 4.3%, to $60.7 million from $58.2 million for the third quarter 2021 and increased $3.2 million, or 5.6%, from $57.5 million for the second quarter 2022. These increases were primarily due to increased interest income on securities and loans as a result of changes in market interest rates. The net interest margin on a tax equivalent basis decreased 5 basis points to 3.85% for the third quarter 2022 from 3.90% for the third quarter 2021 and increased 32 basis points from 3.53% for the second quarter 2022. The decrease in the margin over the prior year was primarily due to the increase in funding costs. The increase in the margin over the prior quarter was primarily due to changes in market interest rates and the composition of earning assets.
Noninterest income for the third quarter 2022 was $3.0 million, an increase of $896 thousand, or 42.7%, compared to $2.1 million for the third quarter 2021 and an increase of $291 thousand, or 10.8%, compared to $2.7 million for the second quarter 2022. Third quarter 2022 other noninterest income included increased income from Small Business Investment Company investments.
Noninterest expense for the third quarter 2022 increased $9.7 million, or 28.4%, to $44.0 million from $34.3 million for the third quarter 2021 and increased $6.1 million, or 16.2%, compared to the second quarter of 2022. These increases in noninterest expense over the prior periods were primarily due to greater acquisition and merger-related expenses associated with the merger with CBTX.
Allegiance's efficiency ratio increased to 69.18% for the third quarter 2022 compared to 56.91% for the third quarter 2021 and 62.96% for the second quarter 2022. Third quarter 2022 annualized returns on average assets, average equity and average tangible equity were 0.84%, 7.90% and 11.78%, respectively, compared to 1.14%, 9.45% and 13.49% for the third quarter 2021. Annualized returns on average assets, average equity and average tangible equity for the second quarter 2022 were 0.94%, 8.86% and 13.00%, respectively. Return on average tangible equity is a non-GAAP measure. Please refer to the non-GAAP reconciliation on page 18.
Financial Condition
Allegiance's total assets at September 30, 2022 decreased $29.4 million, or 0.4%, to $6.73 billion compared to $6.76 billion at September 30, 2021 and decreased $1.4 million, or 0.1% (annualized), compared to $6.73 billion at June 30, 2022.
Total gross loans at September 30, 2022 increased $302.4 million, or 7.1%, to $4.59 billion compared to $4.29 billion at September 30, 2021, primarily due to organic loan growth, and increased $243.1 million, or 22.4% (annualized) compared to $4.35 billion at June 30, 2022, primarily due to the increase in organic loans. Core loans, which exclude Paycheck Protection Program (PPP) loans, increased $574.6 million, or 14.4%, to $4.57 billion at September 30, 2022 from $4.00 billion at September 30, 2021 and increased $257.1 million, or 23.8% (annualized), from $4.32 billion at June 30, 2022.
Deposits at September 30, 2022 decreased $6.2 million, or 0.1%, to $5.66 billion compared to $5.67 billion at September 30, 2021 and decreased $219.9 million, or 15.0% (annualized), compared to $5.88 billion at June 30, 2022.
Asset Quality
Allegiance's nonperforming assets totaled $21.6 million, or 0.32% of total assets, at September 30, 2022 compared to $29.8 million, or 0.44% of total assets, at September 30, 2021 and $28.2 million, or 0.42% of total assets at June 30, 2022. The allowance for credit losses on loans as a percentage of total loans was 1.14% at September 30, 2022, 1.18% at September 30, 2021 and 1.16% at June 30, 2022.
The provision for credit losses for the third quarter 2022 was $2.0 million compared to the provision for credit losses of $2.3 million for the third quarter 2021 and the provision for credit losses of $2.1 million for the second quarter 2022.
Third quarter 2022 net recoveries were $245 thousand, or 0.02% (annualized) of average loans, compared to net charge-offs of $450 thousand, or 0.04% (annualized) of average loans, for the third quarter 2021 and net charge-offs of $571 thousand, or 0.05% (annualized) of average loans, for the second quarter 2022.
Share Repurchase Authorization
On September 22, 2022, the Board of Directors of CBTX authorized the repurchase of up to $40 million of outstanding CBTX (now Stellar) common stock through September 30, 2023. Repurchases under this program may be made from time to time through open market purchases, privately negotiated transactions or such other manners as will comply with applicable laws and regulations. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate and regulatory requirements, market conditions and other corporate liquidity requirements and priorities. The repurchase program does not obligate Stellar to purchase any particular number of shares and there is no guarantee as to the exact dollar amount or number of shares that will be repurchased by Stellar. Stellar may suspend, modify or terminate the program at any time and for any reason, without prior notice.
GAAP Reconciliation of Non-GAAP Financial Measures
Stellar's management uses certain non-GAAP financial measures to evaluate its performance. Please refer to the GAAP Reconciliation and Management's Explanation of Non-GAAP Financial Measures on pages 11 and 18 of this earnings release for a reconciliation of these non-GAAP financial measures.
Conference Call
As previously announced, Stellar's management team will host a conference call and webcast on Friday, October 28, 2022 at 8:00 a.m. Central Time (9:00 a.m. Eastern Time) to discuss third quarter 2022 results of stand-alone CBTX and stand-alone Allegiance. Individuals and investment professionals may register for the conference call at https://register.vevent.com/register/BId5b581acd6f143fdb46c9666597c0d84 to receive the dial-in numbers and unique PIN to access the call. If you need assistance in obtaining a dial-in number, please contact IR@stellarbancorpinc.com. A simultaneous audio-only webcast may be accessed via the Investor Relations section of Stellar's website at https://IR.stellarbancorpinc.com/events-and-presentations. If you are unable to participate during the live webcast, the webcast will be accessible via the Investor Relations section of Stellar's website at IR.stellarbancorpinc.com.
About Stellar Bancorp, Inc.
Stellar Bancorp, Inc. is a bank holding company headquartered in Houston, Texas. Stellar's principal banking subsidiary, created by the merger of Allegiance Bank and CommunityBank of Texas, N.A. and to be renamed Stellar Bank upon system conversion, provides a diversified range of commercial banking services primarily to small- to medium-sized businesses and individual customers across the Houston, Dallas, Beaumont and surrounding communities in Texas.
Investor relations:
IR@stellarbancorpinc.com
Forward-Looking Statements
Certain statements in this press release which are not historical in nature are intended to be, and are hereby identified as, "forward-looking statements" for purposes of the safe harbor provided by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements about the benefits of the merger of CBTX, Inc. (now Stellar Bancorp, Inc.)(the "Company") and Allegiance Bancshares, Inc. ("Allegiance"), including future financial performance and operating results, the combined company's plans, business and growth strategies, objectives, expectations and intentions, and other statements that are not historical facts, including projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Forward-looking statements may be identified by terminology such as "may," "will," "should," "could," "scheduled," "plans," "intends," "projects," "anticipates," "expects," "believes," "estimates," "potential," "would," or "continue" or negatives of such terms or other comparable terminology.
All forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors that may cause the actual results, performance or achievements of Stellar to differ materially from any results expressed or implied by such forward-looking statements. Such factors include, among others: (1) the risk that the cost savings and any revenue synergies from the merger may not be fully realized or may take longer than anticipated to be realized; (2) disruption to our business as a result of the merger; (3) the risk that the integration of our operations will be materially delayed or will be more costly or difficult than we expected or that we are otherwise unable to successfully integrate our legacy businesses; (4) the amount of the costs, fees, expenses and charges related to the merger; (5) reputational risk and the reaction of our customers, suppliers, employees or other business partners to the merger; (6) the possibility that the merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events; (7) the dilution caused by Stellar's issuance of additional shares of its common stock in the merger; (8) general competitive, economic, political and market conditions; and (9) other factors that may affect future results of Stellar including changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer borrowing, repayment, investment and deposit practices; the impact, extent and timing of technological changes; capital management activities; and other actions of the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation and Texas Department of Banking and legislative and regulatory actions and reforms.
Additional factors which could affect the Company's future results can be found in the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K and the Joint Proxy Statement/Prospectus regarding the merger that CBTX filed with the SEC on April 7, 2022 pursuant to Rule 424(b)(3) and Allegiance's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K, in each case filed with the SEC and available on the SEC's website at https:// www.sec.gov. We disclaim any obligation and do not intend to update or revise any forward-looking statements contained in this communication, which speak only as of the date hereof, whether as a result of new information, future events or otherwise, except as required by federal securities laws. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements.
CBTX, Inc.
Financial Highlights
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | September 30 | September 30 | |||||||||||||||||||||
| (Dollars and share amounts in thousands, except per share data) | |||||||||||||||||||||||||||
| Net income (loss) | $ | 12,747 | $ | 11,707 | $ | 10,595 | $ | (545 | ) | $ | 14,421 | $ | 35,049 | $ | 36,143 | ||||||||||||
| Earnings (loss) per share, basic | $ | 0.52 | $ | 0.48 | $ | 0.43 | $ | (0.02 | ) | $ | 0.59 | $ | 1.43 | $ | 1.48 | ||||||||||||
| Earnings (loss) per share, diluted | $ | 0.52 | $ | 0.48 | $ | 0.43 | $ | (0.02 | ) | $ | 0.59 | $ | 1.43 | $ | 1.47 | ||||||||||||
| Dividends per share | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.39 | $ | 0.39 | |||||||||||||
| Return on average assets(A) | 1.16 | % | 1.08 | % | 0.97 | % | (0.05 | %) | 1.37 | % | 1.07 | % | 1.19 | % | |||||||||||||
| Return on average equity(A) | 9.40 | % | 8.75 | % | 7.67 | % | (0.38 | %) | 10.15 | % | 8.60 | % | 8.70 | % | |||||||||||||
| Return on average tangible equity(A)(B) | 11.15 | % | 10.38 | % | 9.03 | % | (0.45 | %) | 11.95 | % | 10.18 | % | 10.27 | % | |||||||||||||
| Net interest margin (tax equivalent)(A)(C) | 4.25 | % | 3.49 | % | 3.22 | % | 3.07 | % | 3.22 | % | 3.65 | % | 3.40 | % | |||||||||||||
| Efficiency ratio(D) | 63.11 | % | 61.84 | % | 64.94 | % | 99.78 | % | 66.21 | % | 63.28 | % | 67.76 | % | |||||||||||||
| Capital Ratios | |||||||||||||||||||||||||||
| CBTX, Inc.(Consolidated) | |||||||||||||||||||||||||||
| Equity to assets | 11.74 | % | 12.19 | % | 12.14 | % | 12.53 | % | 13.41 | % | 11.74 | % | 13.41 | % | |||||||||||||
| Tangible equity to tangible assets(B) | 9.96 | % | 10.44 | % | 10.44 | % | 10.85 | % | 11.64 | % | 9.96 | % | 11.64 | % | |||||||||||||
| Estimated common equity tier 1 capital | 14.05 | % | 14.49 | % | 14.97 | % | 15.31 | % | 16.87 | % | 14.05 | % | 16.87 | % | |||||||||||||
| Estimated tier 1 risk-based capital | 14.05 | % | 14.49 | % | 14.97 | % | 15.31 | % | 16.87 | % | 14.05 | % | 16.87 | % | |||||||||||||
| Estimated total risk-based capital | 15.09 | % | 15.53 | % | 16.06 | % | 16.42 | % | 18.12 | % | 15.09 | % | 18.12 | % | |||||||||||||
| Estimated tier 1 leverage capital | 11.42 | % | 11.48 | % | 11.08 | % | 11.22 | % | 11.69 | % | 11.42 | % | 11.69 | % | |||||||||||||
| CommunityBank of Texas | |||||||||||||||||||||||||||
| Estimated common equity tier 1 capital | 13.81 | % | 13.77 | % | 14.13 | % | 14.43 | % | 15.88 | % | 13.81 | % | 15.88 | % | |||||||||||||
| Estimated tier 1 risk-based capital | 13.81 | % | 13.77 | % | 14.13 | % | 14.43 | % | 15.88 | % | 13.81 | % | 15.88 | % | |||||||||||||
| Estimated total risk-based capital | 14.85 | % | 14.82 | % | 15.22 | % | 15.54 | % | 17.13 | % | 14.85 | % | 17.13 | % | |||||||||||||
| Estimated tier 1 leverage capital | 11.22 | % | 10.91 | % | 10.47 | % | 10.58 | % | 11.01 | % | 11.22 | % | 11.01 | % | |||||||||||||
| Other Data | |||||||||||||||||||||||||||
| Weighted average shares: | |||||||||||||||||||||||||||
| Basic | 24,345 | 24,493 | 24,497 | 24,437 | 24,432 | 24,445 | 24,462 | ||||||||||||||||||||
| Diluted | 24,464 | 24,593 | 24,605 | 24,575 | 24,544 | 24,552 | 24,572 | ||||||||||||||||||||
| Period end shares outstanding | 24,015 | 24,425 | 24,502 | 24,488 | 24,420 | 24,015 | 24,420 | ||||||||||||||||||||
| Book value per share | $ | 20.88 | $ | 21.56 | $ | 22.03 | $ | 22.96 | $ | 23.12 | $ | 20.88 | $ | 23.12 | |||||||||||||
| Tangible book value per share(B) | $ | 17.38 | $ | 18.11 | $ | 18.58 | $ | 19.50 | $ | 19.65 | $ | 17.38 | $ | 19.65 | |||||||||||||
| Employees - full-time equivalents | 487 | 491 | 503 | 506 | 520 | 487 | 520 | ||||||||||||||||||||
(A) Interim periods annualized.
(B) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on page 11 of this Earnings Release.
(C) Net interest margin represents net interest income divided by average interest-earning assets.
(D) Represents total noninterest expense divided by the sum of net interest income plus noninterest income.
CBTX, Inc.
Financial Highlights
(Unaudited)
| 2022 | 2021 | |||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | ||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and due from banks | $ | 41,219 | $ | 41,951 | $ | 47,718 | $ | 27,689 | $ | 50,642 | ||||||||||
| Interest-bearing deposits at other financial institutions | 329,229 | 442,015 | 723,273 | 922,457 | 948,143 | |||||||||||||||
| Total cash and cash equivalents | 370,448 | 483,966 | 770,991 | 950,146 | 998,785 | |||||||||||||||
| Available for sale securities, at fair value | 511,282 | 550,083 | 547,979 | 425,046 | 359,539 | |||||||||||||||
| Equity investments | 17,835 | 18,073 | 17,101 | 17,727 | 17,349 | |||||||||||||||
| Loans held for sale | — | — | 748 | 164 | 327 | |||||||||||||||
| Loans held for investment | 3,126,421 | 3,032,914 | 2,879,880 | 2,867,524 | 2,608,402 | |||||||||||||||
| Less: allowance for credit losses on loans | (32,577 | ) | (32,087 | ) | (31,442 | ) | (31,345 | ) | (32,208 | ) | ||||||||||
| Loans, net | 3,093,844 | 3,000,827 | 2,848,438 | 2,836,179 | 2,576,194 | |||||||||||||||
| Premises and equipment, net | 55,594 | 56,010 | 56,665 | 58,417 | 59,235 | |||||||||||||||
| Goodwill | 80,950 | 80,950 | 80,950 | 80,950 | 80,950 | |||||||||||||||
| Other intangible assets, net | 3,188 | 3,353 | 3,540 | 3,658 | 3,702 | |||||||||||||||
| Bank owned life insurance | 74,274 | 73,898 | 73,527 | 73,156 | 72,771 | |||||||||||||||
| Operating lease right-to-use assets | 10,992 | 11,324 | 10,850 | 11,191 | 11,527 | |||||||||||||||
| Deferred tax assets, net | 29,581 | 22,699 | 16,724 | 9,973 | 9,760 | |||||||||||||||
| Other assets | 23,843 | 21,120 | 18,464 | 19,394 | 18,980 | |||||||||||||||
| Total assets | $ | 4,271,831 | $ | 4,322,303 | $ | 4,445,977 | $ | 4,486,001 | $ | 4,209,119 | ||||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
| LIABILITIES: | ||||||||||||||||||||
| Deposits: | ||||||||||||||||||||
| Noninterest-bearing | $ | 1,780,473 | $ | 1,810,275 | $ | 1,801,323 | $ | 1,784,981 | $ | 1,628,144 | ||||||||||
| Interest-bearing | ||||||||||||||||||||
| Demand | 415,970 | 445,149 | 444,571 | 468,361 | 386,196 | |||||||||||||||
| Money market and savings | 1,273,855 | 1,239,978 | 1,348,300 | 1,336,690 | 1,257,961 | |||||||||||||||
| Certificates and other time | 253,476 | 261,232 | 227,031 | 241,252 | 259,334 | |||||||||||||||
| Total interest-bearing deposits | 1,943,301 | 1,946,359 | 2,019,902 | 2,046,303 | 1,903,491 | |||||||||||||||
| Total deposits | 3,723,774 | 3,756,634 | 3,821,225 | 3,831,284 | 3,531,635 | |||||||||||||||
| Operating lease liabilities | 13,748 | 14,169 | 13,752 | 14,142 | 14,556 | |||||||||||||||
| Federal Home Loan Bank advances | — | — | 50,000 | 50,000 | 50,000 | |||||||||||||||
| Other liabilities | 32,884 | 24,821 | 21,277 | 28,450 | 48,335 | |||||||||||||||
| Total liabilities | 3,770,406 | 3,795,624 | 3,906,254 | 3,923,876 | 3,644,526 | |||||||||||||||
| SHAREHOLDERS' EQUITY: | ||||||||||||||||||||
| Common stock | 240 | 253 | 253 | 253 | 253 | |||||||||||||||
| Capital surplus | 308,197 | 334,104 | 336,214 | 335,846 | 335,226 | |||||||||||||||
| Retained earnings | 262,804 | 253,180 | 244,672 | 237,165 | 241,012 | |||||||||||||||
| Treasury stock | — | (14,046 | ) | (14,196 | ) | (14,196 | ) | (14,334 | ) | |||||||||||
| Accumulated other comprehensive (loss) income | (69,816 | ) | (46,812 | ) | (27,220 | ) | 3,057 | 2,436 | ||||||||||||
| Total shareholders' equity | 501,425 | 526,679 | 539,723 | 562,125 | 564,593 | |||||||||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 4,271,831 | $ | 4,322,303 | $ | 4,445,977 | $ | 4,486,001 | $ | 4,209,119 | ||||||||||
CBTX, Inc.
Financial Highlights
(Unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | September 30 | September 30 | ||||||||||||||||||
| (Dollars in thousands, except per share data) | ||||||||||||||||||||||||
| INTEREST INCOME: | ||||||||||||||||||||||||
| Interest and fees on loans | $ | 39,058 | $ | 31,768 | $ | 31,221 | $ | 29,882 | $ | 30,765 | $ | 102,047 | $ | 94,723 | ||||||||||
| Securities | 3,046 | 2,937 | 2,292 | 1,796 | 1,435 | 8,275 | 3,940 | |||||||||||||||||
| Interest-bearing deposits at other financial institutions | 2,408 | 1,238 | 348 | 383 | 340 | 3,994 | 740 | |||||||||||||||||
| Equity investments | 161 | 158 | 154 | 168 | 157 | 473 | 461 | |||||||||||||||||
| Total interest income | 44,673 | 36,101 | 34,015 | 32,229 | 32,697 | 114,789 | 99,864 | |||||||||||||||||
| INTEREST EXPENSE: | ||||||||||||||||||||||||
| Deposits | 1,661 | 1,178 | 1,164 | 1,180 | 1,227 | 4,003 | 3,844 | |||||||||||||||||
| Federal Home Loan Bank advances | — | 51 | 221 | 222 | 221 | 272 | 663 | |||||||||||||||||
| Other interest-bearing liabilities | — | — | — | 17 | — | — | — | |||||||||||||||||
| Total interest expense | 1,661 | 1,229 | 1,385 | 1,419 | 1,448 | 4,275 | 4,507 | |||||||||||||||||
| NET INTEREST INCOME | 43,012 | 34,872 | 32,630 | 30,810 | 31,249 | 110,514 | 95,357 | |||||||||||||||||
| Provision (recapture) for credit losses for loans | 523 | 479 | 20 | (901 | ) | (5,057 | ) | 1,022 | (8,961 | ) | ||||||||||||||
| Provision (recapture) for credit losses for unfunded commitments | 489 | (353 | ) | 415 | (306 | ) | 162 | 551 | (605 | ) | ||||||||||||||
| Total provision (recapture) for credit losses | 1,012 | 126 | 435 | (1,207 | ) | (4,895 | ) | 1,573 | (9,566 | ) | ||||||||||||||
| Net interest income after provision (recapture) for credit losses | 42,000 | 34,746 | 32,195 | 32,017 | 36,144 | 108,941 | 104,923 | |||||||||||||||||
| NONINTEREST INCOME: | ||||||||||||||||||||||||
| Deposit account service charges | 1,320 | 1,386 | 1,370 | 1,370 | 1,352 | 4,076 | 3,712 | |||||||||||||||||
| Card interchange fees | 1,056 | 1,135 | 1,037 | 1,081 | 1,048 | 3,228 | 3,119 | |||||||||||||||||
| Earnings on bank-owned life insurance | 376 | 371 | 371 | 385 | 2,323 | 1,118 | 3,103 | |||||||||||||||||
| Net gain on sales of assets | 85 | 58 | 530 | 910 | 360 | 673 | 918 | |||||||||||||||||
| Other | 612 | 596 | 2,021 | 354 | 479 | 3,229 | 1,312 | |||||||||||||||||
| Total noninterest income | 3,449 | 3,546 | 5,329 | 4,100 | 5,562 | 12,324 | 12,164 | |||||||||||||||||
| NONINTEREST EXPENSE: | ||||||||||||||||||||||||
| Salaries and employee benefits | 14,706 | 14,698 | 15,254 | 16,609 | 15,000 | 44,658 | 43,922 | |||||||||||||||||
| Occupancy expense | 2,595 | 2,386 | 2,371 | 2,606 | 2,660 | 7,352 | 7,778 | |||||||||||||||||
| Professional and director fees | 836 | 1,140 | 879 | 756 | 1,167 | 2,855 | 5,271 | |||||||||||||||||
| Data processing and software | 1,502 | 1,210 | 1,763 | 1,716 | 1,629 | 4,475 | 4,866 | |||||||||||||||||
| Regulatory fees | 599 | 803 | 614 | 8,366 | 478 | 2,016 | 1,535 | |||||||||||||||||
| Advertising, marketing and business development | 350 | 366 | 249 | 263 | 493 | 965 | 1,288 | |||||||||||||||||
| Telephone and communications | 348 | 349 | 454 | 471 | 516 | 1,151 | 1,529 | |||||||||||||||||
| Security and protection expense | 386 | 170 | 324 | 439 | 425 | 880 | 1,352 | |||||||||||||||||
| Amortization of intangibles | 165 | 172 | 181 | 179 | 182 | 518 | 559 | |||||||||||||||||
| Acquisition and merger-related expenses | 5,897 | 1,100 | 784 | 1,293 | 400 | 7,781 | 1,689 | |||||||||||||||||
| Other expenses | 1,937 | 1,364 | 1,779 | 2,134 | 1,422 | 5,080 | 3,065 | |||||||||||||||||
| Total noninterest expense | 29,321 | 23,758 | 24,652 | 34,832 | 24,372 | 77,731 | 72,854 | |||||||||||||||||
| INCOME BEFORE INCOME TAXES | 16,128 | 14,534 | 12,872 | 1,285 | 17,334 | 43,534 | 44,233 | |||||||||||||||||
| Provision for income taxes | 3,381 | 2,827 | 2,277 | 1,830 | 2,913 | 8,485 | 8,090 | |||||||||||||||||
| NET INCOME (LOSS) | $ | 12,747 | $ | 11,707 | $ | 10,595 | $ | (545 | ) | $ | 14,421 | $ | 35,049 | $ | 36,143 | |||||||||
| EARNINGS PER SHARE | ||||||||||||||||||||||||
| Basic | $ | 0.52 | $ | 0.48 | $ | 0.43 | $ | (0.02 | ) | $ | 0.59 | $ | 1.43 | $ | 1.48 | |||||||||
| Diluted | $ | 0.52 | $ | 0.48 | $ | 0.43 | $ | (0.02 | ) | $ | 0.59 | $ | 1.43 | $ | 1.47 | |||||||||
CBTX, Inc.
Financial Highlights
(Unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||
| September 30, 2022 | June 30, 2022 | September 30, 2021 | |||||||||||||||||||||||||||
| Average Outstanding Balance | Interest Earned/ Interest Paid | Average Yield/ Rate(A) | Average Outstanding Balance | Interest Earned/ Interest Paid | Average Yield/ Rate(A) | Average Outstanding Balance | Interest Earned/ Interest Paid | Average Yield/ Rate(A) | |||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||
| Interest-Earning Assets: | |||||||||||||||||||||||||||||
| Total loans(B) | $ | 3,074,655 | $ | 39,058 | 5.04 | % | $ | 2,897,335 | $ | 31,768 | 4.40 | % | $ | 2,702,248 | $ | 30,765 | 4.52 | % | |||||||||||
| Securities | 552,901 | 3,046 | 2.19 | % | 562,518 | 2,937 | 2.09 | % | 327,968 | 1,435 | 1.74 | % | |||||||||||||||||
| Interest-bearing deposits at other financial institutions | 428,196 | 2,408 | 2.23 | % | 593,255 | 1,238 | 0.84 | % | 854,406 | 340 | 0.16 | % | |||||||||||||||||
| Equity investments | 13,393 | 161 | 4.77 | % | 13,386 | 158 | 4.73 | % | 13,367 | 157 | 4.66 | % | |||||||||||||||||
| Total interest-earning assets | 4,069,145 | $ | 44,673 | 4.36 | % | 4,066,494 | $ | 36,101 | 3.56 | % | 3,897,989 | $ | 32,697 | 3.33 | % | ||||||||||||||
| Allowance for credit losses on loans | (32,106 | ) | (31,081 | ) | (36,945 | ) | |||||||||||||||||||||||
| Noninterest-earning assets | 318,761 | 315,133 | 313,901 | ||||||||||||||||||||||||||
| Total assets | $ | 4,355,800 | $ | 4,350,546 | $ | 4,174,945 | |||||||||||||||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||||||||||||||||
| Interest-Bearing Liabilities: | |||||||||||||||||||||||||||||
| Interest-bearing deposits | $ | 1,954,854 | $ | 1,661 | 0.34 | % | $ | 1,939,990 | $ | 1,178 | 0.24 | % | $ | 1,895,617 | $ | 1,227 | 0.26 | % | |||||||||||
| Federal Home Loan Bank advances | — | — | 0.00 | % | 5,495 | 51 | 3.72 | % | 50,000 | 221 | 1.75 | % | |||||||||||||||||
| Total interest-bearing liabilities | 1,954,854 | $ | 1,661 | 0.34 | % | 1,945,485 | $ | 1,229 | 0.25 | % | 1,945,617 | $ | 1,448 | 0.30 | % | ||||||||||||||
| Noninterest-Bearing Liabilities: | |||||||||||||||||||||||||||||
| Noninterest-bearing demand deposits | 1,822,323 | 1,825,400 | 1,612,985 | ||||||||||||||||||||||||||
| Other liabilities | 40,684 | 42,861 | 52,712 | ||||||||||||||||||||||||||
| Total noninterest-bearing liabilities | 1,863,007 | 1,868,261 | 1,665,697 | ||||||||||||||||||||||||||
| Shareholders' equity | 537,939 | 536,800 | 563,631 | ||||||||||||||||||||||||||
| Total liabilities and shareholders' equity | $ | 4,355,800 | $ | 4,350,546 | $ | 4,174,945 | |||||||||||||||||||||||
| Net interest income | $ | 43,012 | $ | 34,872 | $ | 31,249 | |||||||||||||||||||||||
| Net interest spread(C) | 4.02 | % | 3.31 | % | 3.03 | % | |||||||||||||||||||||||
| Net interest margin(D) | 4.19 | % | 3.44 | % | 3.18 | % | |||||||||||||||||||||||
| Net interest margin - tax equivalent(E) | 4.25 | % | 3.49 | % | 3.22 | % | |||||||||||||||||||||||
(A) Annualized.
(B) Includes average outstanding balances related to loans held for sale.
(C) Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
(D) Net interest margin is equal to net interest income divided by average interest-earning assets.
(E) Tax equivalent adjustments of $578 thousand, $478 thousand and $369 thousand for the three months ended September 30, 2022, June 30, 2022 and September 30, 2021, respectively, were computed using a federal income tax rate of 21%.
CBTX, Inc.
Financial Highlights
(Unaudited)
| Nine Months Ended September 30, | |||||||||||||||||||
| 2022 | 2021 | ||||||||||||||||||
| Average Outstanding Balance | Interest Earned/ Interest Paid | Average Yield/ Rate(A) | Average Outstanding Balance | Interest Earned/ Interest Paid | Average Yield/ Rate(A) | ||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||
| Assets | |||||||||||||||||||
| Interest-Earning Assets: | |||||||||||||||||||
| Total loans(B) | $ | 2,953,607 | $ | 102,047 | 4.62 | % | $ | 2,812,449 | $ | 94,723 | 4.50 | % | |||||||
| Securities | 537,889 | 8,275 | 2.06 | % | 296,958 | 3,940 | 1.77 | % | |||||||||||
| Interest-bearing deposits at other financial institutions | 595,458 | 3,994 | 0.90 | % | 668,119 | 740 | 0.15 | % | |||||||||||
| Equity investments | 13,386 | 473 | 4.72 | % | 14,679 | 461 | 4.20 | % | |||||||||||
| Total interest-earning assets | 4,100,340 | $ | 114,789 | 3.74 | % | 3,792,205 | $ | 99,864 | 3.52 | % | |||||||||
| Allowance for credit losses on loans | (31,599 | ) | (39,594 | ) | |||||||||||||||
| Noninterest-earning assets | 313,938 | 318,009 | |||||||||||||||||
| Total assets | $ | 4,382,679 | $ | 4,070,620 | |||||||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||||||
| Interest-Bearing Liabilities: | |||||||||||||||||||
| Interest-bearing deposits | $ | 1,971,247 | $ | 4,003 | 0.27 | % | $ | 1,846,211 | $ | 3,844 | 0.28 | % | |||||||
| Federal Home Loan Bank advances | 18,315 | 272 | 1.99 | % | 50,000 | 663 | 1.77 | % | |||||||||||
| Total interest-bearing liabilities | 1,989,562 | $ | 4,275 | 0.29 | % | 1,896,211 | 4,507 | 0.32 | % | ||||||||||
| Noninterest-Bearing Liabilities: | |||||||||||||||||||
| Noninterest-bearing demand deposits | 1,803,702 | 1,568,071 | |||||||||||||||||
| Other liabilities | 44,479 | 50,966 | |||||||||||||||||
| Total noninterest-bearing liabilities | 1,848,181 | 1,619,037 | |||||||||||||||||
| Shareholders' equity | 544,936 | 555,372 | |||||||||||||||||
| Total liabilities and shareholders' equity | $ | 4,382,679 | $ | 4,070,620 | |||||||||||||||
| Net interest income | $ | 110,514 | $ | 95,357 | |||||||||||||||
| Net interest spread(C) | 3.45 | % | 3.20 | % | |||||||||||||||
| Net interest margin(D) | 3.60 | % | 3.36 | % | |||||||||||||||
| Net interest margin - tax equivalent(E) | 3.65 | % | 3.40 | % | |||||||||||||||
(A) Annualized.
(B) Includes average outstanding balances related to loans held for sale.
(C) Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
(D) Net interest margin is equal to net interest income divided by average interest-earning assets.
(E) Tax equivalent adjustments of $1.5 million and $989 thousand for the nine months ended September 30, 2022 and 2021, respectively, were computed using a federal income tax rate of 21%.
CBTX, Inc.
Financial Highlights
(Unaudited)
| Three Months Ended | |||||||||||||||||||
| 2022 | 2021 | ||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | |||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||
| Loan Portfolio: | |||||||||||||||||||
| Commercial and industrial | $ | 568,071 | $ | 581,443 | $ | 600,990 | $ | 634,384 | $ | 596,251 | |||||||||
| Real estate: | |||||||||||||||||||
| Commercial real estate | 1,242,118 | 1,181,620 | 1,142,646 | 1,091,969 | 1,029,137 | ||||||||||||||
| Construction and development | 507,570 | 560,903 | 473,326 | 460,719 | 393,541 | ||||||||||||||
| 1-4 family residential | 288,456 | 264,428 | 263,213 | 277,273 | 204,151 | ||||||||||||||
| Multi-family residential | 370,391 | 300,582 | 279,099 | 286,396 | 285,852 | ||||||||||||||
| Consumer | 24,509 | 26,810 | 28,230 | 28,090 | 27,930 | ||||||||||||||
| Agriculture | 11,185 | 8,036 | 6,287 | 7,941 | 8,780 | ||||||||||||||
| Other | 123,591 | 118,153 | 95,187 | 89,655 | 71,915 | ||||||||||||||
| Gross loans | 3,135,891 | 3,041,975 | 2,888,978 | 2,876,427 | 2,617,557 | ||||||||||||||
| Less allowance for credit losses | (32,577 | ) | (32,087 | ) | (31,442 | ) | (31,345 | ) | (32,208 | ) | |||||||||
| Less deferred fees and unearned discount | (9,470 | ) | (9,061 | ) | (8,350 | ) | (8,739 | ) | (8,828 | ) | |||||||||
| Less loans held for sale | — | — | (748 | ) | (164 | ) | (327 | ) | |||||||||||
| Loans, net | $ | 3,093,844 | $ | 3,000,827 | $ | 2,848,438 | $ | 2,836,179 | $ | 2,576,194 | |||||||||
| Deposits: | |||||||||||||||||||
| Interest-bearing demand accounts | $ | 415,970 | $ | 445,149 | $ | 444,571 | $ | 468,361 | $ | 386,196 | |||||||||
| Money market accounts | 1,144,969 | 1,109,265 | 1,218,082 | 1,209,659 | 1,139,167 | ||||||||||||||
| Savings accounts | 128,886 | 130,713 | 130,218 | 127,031 | 118,794 | ||||||||||||||
| Certificates and other time deposits, $100,000 or greater | 161,975 | 169,616 | 127,798 | 134,775 | 140,740 | ||||||||||||||
| Certificates and other time deposits, less than $100,000 | 91,501 | 91,616 | 99,233 | 106,477 | 118,594 | ||||||||||||||
| Total interest-bearing deposits | 1,943,301 | 1,946,359 | 2,019,902 | 2,046,303 | 1,903,491 | ||||||||||||||
| Noninterest-bearing deposits | 1,780,473 | 1,810,275 | 1,801,323 | 1,784,981 | 1,628,144 | ||||||||||||||
| Total deposits | $ | 3,723,774 | $ | 3,756,634 | $ | 3,821,225 | $ | 3,831,284 | $ | 3,531,635 | |||||||||
| Asset Quality: | |||||||||||||||||||
| Nonaccrual loans | $ | 22,410 | $ | 28,273 | $ | 22,083 | $ | 22,568 | $ | 20,585 | |||||||||
| Accruing loans 90 or more days past due | — | — | — | — | — | ||||||||||||||
| Total nonperforming loans | 22,410 | 28,273 | 22,083 | 22,568 | 20,585 | ||||||||||||||
| Other real estate | — | — | — | — | — | ||||||||||||||
| Total nonperforming assets | $ | 22,410 | $ | 28,273 | $ | 22,083 | $ | 22,568 | $ | 20,585 | |||||||||
| Net charge-offs (recoveries) | $ | 33 | $ | (166 | ) | $ | (77 | ) | $ | (38 | ) | $ | (82 | ) | |||||
| Nonaccrual loans: | |||||||||||||||||||
| Commercial and industrial | $ | 7,985 | $ | 8,312 | $ | 8,765 | $ | 9,090 | $ | 9,773 | |||||||||
| Real estate: | |||||||||||||||||||
| Commercial real estate | 11,076 | 16,481 | 11,363 | 11,512 | 10,419 | ||||||||||||||
| Construction and development | 139 | 143 | 140 | 142 | — | ||||||||||||||
| 1-4 family residential | 3,176 | 3,302 | 1,777 | 1,784 | 351 | ||||||||||||||
| Multi-family residential | — | — | — | — | — | ||||||||||||||
| Consumer | — | — | — | — | — | ||||||||||||||
| Agriculture | — | — | — | — | — | ||||||||||||||
| Other | 34 | 35 | 38 | 40 | 42 | ||||||||||||||
| Total nonaccrual loans | $ | 22,410 | $ | 28,273 | $ | 22,083 | $ | 22,568 | $ | 20,585 | |||||||||
| Asset Quality Ratios: | |||||||||||||||||||
| Nonperforming assets to total assets | 0.52 | % | 0.65 | % | 0.50 | % | 0.50 | % | 0.49 | % | |||||||||
| Nonperforming loans to loans excluding loans held for sale | 0.72 | % | 0.93 | % | 0.77 | % | 0.79 | % | 0.79 | % | |||||||||
| Allowance for credit losses on loans to nonperforming loans | 145.37 | % | 113.49 | % | 142.38 | % | 138.89 | % | 156.46 | % | |||||||||
| Allowance for credit losses on loans to loans excluding loans held for sale | 1.04 | % | 1.06 | % | 1.09 | % | 1.09 | % | 1.23 | % | |||||||||
| Net charge-offs (recoveries) to average loans (annualized) | 0.00 | % | (0.02 | %) | (0.01 | %) | (0.01 | %) | (0.01 | %) | |||||||||
CBTX, Inc.
GAAP Reconciliation and Management's Explanation of Non-GAAP Financial Measures
(Unaudited)
CBTX's management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate its performance. CBTX believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and that management and investors benefit from referring to these non-GAAP financial measures in assessing CBTX's performance and when planning, forecasting, analyzing and comparing past, present and future periods. Specifically, CBTX reviews pre-tax, pre-provision income, adjusted pre-tax, pre-provision income, adjusted efficiency ratio, tangible book value per share, return on average tangible equity and the ratio of tangible equity to tangible assets for internal planning and forecasting purposes. CBTX has included in this earnings release information relating to these non-GAAP financial measures for the applicable periods presented. These non-GAAP measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which CBTX calculates the non-GAAP financial measures may differ from that of other companies reporting measures with similar names.
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | September 30 | September 30 | |||||||||||||||||||||
| (Dollars and share amounts in thousands, except per share data) | |||||||||||||||||||||||||||
| Net income | $ | 12,747 | $ | 11,707 | $ | 10,595 | $ | (545 | ) | $ | 14,421 | $ | 35,049 | $ | 36,143 | ||||||||||||
| Add: Provision for credit losses | 1,012 | 126 | 435 | (1,207 | ) | (4,895 | ) | 1,573 | (9,566 | ) | |||||||||||||||||
| Add: Provision for income taxes | 3,381 | 2,827 | 2,277 | 1,830 | 2,913 | 8,485 | 8,090 | ||||||||||||||||||||
| Pre-tax, pre-provision income | $ | 17,140 | $ | 14,660 | $ | 13,307 | $ | 78 | $ | 12,439 | $ | 45,107 | $ | 34,667 | |||||||||||||
| Pre-tax, pre-provision income | $ | 17,140 | $ | 14,660 | $ | 13,307 | $ | 78 | $ | 12,439 | $ | 45,107 | $ | 34,667 | |||||||||||||
| Add: Acquisition and merger-related expenses | 5,897 | 1,100 | 784 | 1,293 | 400 | 7,781 | 1,689 | ||||||||||||||||||||
| Adjusted pre-tax, pre-provision income | $ | 23,037 | $ | 15,760 | $ | 14,091 | $ | 1,371 | $ | 12,839 | $ | 52,888 | $ | 36,356 | |||||||||||||
| Total noninterest expense | $ | 29,321 | $ | 23,758 | $ | 24,652 | $ | 34,832 | $ | 24,372 | $ | 77,731 | $ | 72,854 | |||||||||||||
| Acquisition and merger-related expenses | 5,897 | 1,100 | 784 | 1,293 | 400 | 7,781 | 1,689 | ||||||||||||||||||||
| Net interest income | 43,012 | 34,872 | 32,630 | 30,810 | 31,249 | 110,514 | 95,357 | ||||||||||||||||||||
| Total noninterest income | 3,449 | 3,546 | 5,329 | 4,100 | 5,562 | 12,324 | 12,164 | ||||||||||||||||||||
| Adjusted efficiency ratio(A) | 50.42 | % | 58.98 | % | 62.88 | % | 96.07 | % | 65.12 | % | 56.94 | % | 66.19 | % | |||||||||||||
| Total shareholders' equity | $ | 501,425 | $ | 526,679 | $ | 539,723 | $ | 562,125 | $ | 564,593 | $ | 501,425 | $ | 564,593 | |||||||||||||
| Less: Goodwill and other intangible assets, net | 84,138 | 84,303 | 84,490 | 84,608 | 84,652 | 84,138 | 84,652 | ||||||||||||||||||||
| Tangible shareholders' equity | $ | 417,287 | $ | 442,376 | $ | 455,233 | $ | 477,517 | $ | 479,941 | $ | 417,287 | $ | 479,941 | |||||||||||||
| Shares outstanding at end of period | 24,015 | 24,425 | 24,502 | 24,488 | 24,420 | 24,015 | 24,420 | ||||||||||||||||||||
| Tangible book value per share | $ | 17.38 | $ | 18.11 | $ | 18.58 | $ | 19.50 | $ | 19.65 | $ | 17.38 | $ | 19.65 | |||||||||||||
| Net income | $ | 12,747 | $ | 11,707 | $ | 10,595 | $ | (545 | ) | $ | 14,421 | $ | 35,049 | $ | 36,143 | ||||||||||||
| Average shareholders' equity | $ | 537,939 | $ | 536,800 | $ | 560,315 | $ | 568,167 | $ | 563,631 | $ | 544,936 | $ | 555,372 | |||||||||||||
| Less: Average goodwill and other intangible assets, net | 84,242 | 84,413 | 84,584 | 84,643 | 84,753 | 84,413 | 84,901 | ||||||||||||||||||||
| Average tangible shareholders' equity | $ | 453,697 | $ | 452,387 | $ | 475,731 | $ | 483,524 | $ | 478,878 | $ | 460,523 | $ | 470,471 | |||||||||||||
| Return on average tangible equity(B) | 11.15 | % | 10.38 | % | 9.03 | % | (0.45 | %) | 11.95 | % | 10.18 | % | 10.27 | % | |||||||||||||
| Total assets | $ | 4,271,831 | $ | 4,322,303 | $ | 4,445,977 | $ | 4,486,001 | $ | 4,209,119 | $ | 4,271,831 | $ | 4,209,119 | |||||||||||||
| Less: Goodwill and other intangible assets, net | 84,138 | 84,303 | 84,490 | 84,608 | 84,652 | 84,138 | 84,652 | ||||||||||||||||||||
| Tangible assets | $ | 4,187,693 | $ | 4,238,000 | $ | 4,361,487 | $ | 4,401,393 | $ | 4,124,467 | $ | 4,187,693 | $ | 4,124,467 | |||||||||||||
| Tangible equity to tangible assets | 9.96 | % | 10.44 | % | 10.44 | % | 10.85 | % | 11.64 | % | 9.96 | % | 11.64 | % | |||||||||||||
(A) Represents total noninterest expense, excluding acquisition and merger-related expenses, divided by the sum of net interest income plus noninterest income. Additionally, taxes and provision for credit losses are not part of this calculation.
(B) Interim periods annualized.
Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | September 30 | September 30 | |||||||||||||||||||||
| (Dollars and share amounts in thousands, except per share data) | |||||||||||||||||||||||||||
| Net income | $ | 14,286 | $ | 16,437 | $ | 18,657 | $ | 21,558 | $ | 19,060 | $ | 49,380 | $ | 59,995 | |||||||||||||
| Earnings per share, basic | $ | 0.72 | $ | 0.81 | $ | 0.92 | $ | 1.06 | $ | 0.94 | $ | 2.44 | $ | 2.97 | |||||||||||||
| Earnings per share, diluted | $ | 0.71 | $ | 0.80 | $ | 0.91 | $ | 1.06 | $ | 0.93 | $ | 2.42 | $ | 2.95 | |||||||||||||
| Dividends per share | $ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.12 | $ | 0.12 | $ | 0.42 | $ | 0.36 | |||||||||||||
| Return on average assets(A) | 0.84 | % | 0.94 | % | 1.04 | % | 1.23 | % | 1.14 | % | 0.94 | % | 1.25 | % | |||||||||||||
| Return on average equity(A) | 7.90 | % | 8.86 | % | 9.40 | % | 10.60 | % | 9.45 | % | 8.74 | % | 10.30 | % | |||||||||||||
| Return on average tangible equity(A)(B) | 11.78 | % | 13.00 | % | 13.35 | % | 15.05 | % | 13.49 | % | 12.75 | % | 14.89 | % | |||||||||||||
| Net interest margin (tax equivalent)(A)(C) | 3.85 | % | 3.53 | % | 3.30 | % | 3.57 | % | 3.90 | % | 3.55 | % | 4.03 | % | |||||||||||||
| Efficiency ratio(D) | 69.18 | % | 62.96 | % | 58.32 | % | 60.68 | % | 56.91 | % | 63.62 | % | 58.24 | % | |||||||||||||
| Capital Ratios | |||||||||||||||||||||||||||
| Allegiance Bancshares, Inc.(Consolidated) | |||||||||||||||||||||||||||
| Equity to assets | 9.75 | % | 10.48 | % | 10.52 | % | 11.49 | % | 11.81 | % | 9.75 | % | 11.81 | % | |||||||||||||
| Tangible equity to tangible assets(B) | 6.47 | % | 7.21 | % | 7.44 | % | 8.42 | % | 8.58 | % | 6.47 | % | 8.58 | % | |||||||||||||
| Estimated common equity tier 1 capital | 11.39 | % | 12.06 | % | 12.28 | % | 12.47 | % | 12.37 | % | 11.39 | % | 12.37 | % | |||||||||||||
| Estimated tier 1 risk-based capital | 11.58 | % | 12.26 | % | 12.49 | % | 12.69 | % | 12.60 | % | 11.58 | % | 12.60 | % | |||||||||||||
| Estimated total risk-based capital | 14.66 | % | 15.47 | % | 15.76 | % | 16.08 | % | 16.13 | % | 14.66 | % | 16.13 | % | |||||||||||||
| Estimated tier 1 leverage capital | 9.00 | % | 8.65 | % | 8.37 | % | 8.53 | % | 8.76 | % | 9.00 | % | 8.76 | % | |||||||||||||
| Allegiance Bank | |||||||||||||||||||||||||||
| Estimated common equity tier 1 capital | 12.20 | % | 12.51 | % | 12.48 | % | 12.63 | % | 12.81 | % | 12.20 | % | 12.81 | % | |||||||||||||
| Estimated tier 1 risk-based capital | 12.20 | % | 12.51 | % | 12.48 | % | 12.63 | % | 12.81 | % | 12.20 | % | 12.81 | % | |||||||||||||
| Estimated total risk-based capital | 14.12 | % | 14.50 | % | 14.50 | % | 14.71 | % | 14.98 | % | 14.12 | % | 14.98 | % | |||||||||||||
| Estimated tier 1 leverage capital | 9.49 | % | 8.83 | % | 8.37 | % | 8.49 | % | 8.91 | % | 9.49 | % | 8.91 | % | |||||||||||||
| Other Data | |||||||||||||||||||||||||||
| Weighted average shares: | |||||||||||||||||||||||||||
| Basic | 19,942 | 20,357 | 20,363 | 20,260 | 20,221 | 20,219 | 20,188 | ||||||||||||||||||||
| Diluted | 20,114 | 20,530 | 20,526 | 20,423 | 20,411 | 20,376 | 20,369 | ||||||||||||||||||||
| Period end shares outstanding | 19,837 | 20,154 | 20,378 | 20,337 | 20,218 | 19,837 | 20,218 | ||||||||||||||||||||
| Book value per share | $ | 33.08 | $ | 35.00 | $ | 36.90 | $ | 40.15 | $ | 39.50 | $ | 33.08 | $ | 39.50 | |||||||||||||
| Tangible book value per share(B) | $ | 21.19 | $ | 23.25 | $ | 25.24 | $ | 28.43 | $ | 27.67 | $ | 21.19 | $ | 27.67 | |||||||||||||
| Employees - full-time equivalents | 562 | 578 | 586 | 594 | 603 | 562 | 603 | ||||||||||||||||||||
(A) Interim periods annualized.
(B) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on page 18 of this Earnings Release.
(C) Net interest margin represents net interest income divided by average interest-earning assets.
(D) Represents total noninterest expense divided by the sum of net interest income plus noninterest income, excluding net gains and losses on the sale of loans, securities and assets. Additionally, taxes and provision for credit losses are not part of this calculation.
Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
| 2022 | 2021 | |||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | ||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and due from banks | $ | 16,449 | $ | 17,547 | $ | 26,629 | $ | 23,961 | $ | 23,903 | ||||||||||
| Interest-bearing deposits at other financial institutions | 102,118 | 275,290 | 672,755 | 733,548 | 879,858 | |||||||||||||||
| Total cash and cash equivalents | 118,567 | 292,837 | 699,384 | 757,509 | 903,761 | |||||||||||||||
| Available for sale securities, at fair value | 1,618,995 | 1,709,321 | 1,790,707 | 1,773,765 | 1,211,476 | |||||||||||||||
| Loans held for investment | 4,591,912 | 4,348,833 | 4,283,514 | 4,220,486 | 4,289,469 | |||||||||||||||
| Less: allowance for credit losses on loans | (52,147 | ) | (50,242 | ) | (49,215 | ) | (47,940 | ) | (50,491 | ) | ||||||||||
| Loans, net | 4,539,765 | 4,298,591 | 4,234,299 | 4,172,546 | 4,238,978 | |||||||||||||||
| Accrued interest receivable | 29,697 | 29,882 | 31,505 | 33,392 | 33,523 | |||||||||||||||
| Premises and equipment, net | 57,837 | 58,482 | 62,168 | 63,708 | 65,140 | |||||||||||||||
| Other real estate owned | — | — | — | — | 1,397 | |||||||||||||||
| Federal Home Loan Bank stock | 16,843 | 4,078 | 9,376 | 9,358 | 8,326 | |||||||||||||||
| Bank owned life insurance | 28,305 | 28,170 | 28,374 | 28,240 | 28,101 | |||||||||||||||
| Goodwill | 223,642 | 223,642 | 223,642 | 223,642 | 223,642 | |||||||||||||||
| Core deposit intangibles, net | 12,406 | 13,156 | 13,907 | 14,658 | 15,482 | |||||||||||||||
| Other assets | 84,285 | 73,605 | 56,001 | 28,136 | 29,935 | |||||||||||||||
| Total assets | $ | 6,730,342 | $ | 6,731,764 | $ | 7,149,363 | $ | 7,104,954 | $ | 6,759,761 | ||||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
| LIABILITIES: | ||||||||||||||||||||
| Deposits: | ||||||||||||||||||||
| Noninterest-bearing | $ | 2,465,839 | $ | 2,394,719 | $ | 2,353,604 | $ | 2,243,085 | $ | 2,086,683 | ||||||||||
| Interest-bearing | ||||||||||||||||||||
| Demand | 956,920 | 1,016,381 | 1,070,855 | 869,984 | 594,959 | |||||||||||||||
| Money market and savings | 1,471,690 | 1,510,008 | 1,552,853 | 1,643,745 | 1,604,222 | |||||||||||||||
| Certificates and other time | 766,270 | 959,524 | 1,185,015 | 1,290,825 | 1,381,014 | |||||||||||||||
| Total interest-bearing deposits | 3,194,880 | 3,485,913 | 3,808,723 | 3,804,554 | 3,580,195 | |||||||||||||||
| Total deposits | 5,660,719 | 5,880,632 | 6,162,327 | 6,047,639 | 5,666,878 | |||||||||||||||
| Accrued interest payable | 2,673 | 1,500 | 3,086 | 1,753 | 3,296 | |||||||||||||||
| Borrowed funds | 257,000 | — | 89,959 | 89,956 | 139,954 | |||||||||||||||
| Subordinated debt | 109,241 | 109,109 | 108,978 | 108,847 | 108,715 | |||||||||||||||
| Other liabilities | 44,407 | 35,194 | 33,073 | 40,291 | 42,326 | |||||||||||||||
| Total liabilities | 6,074,040 | 6,026,435 | 6,397,423 | 6,288,486 | 5,961,169 | |||||||||||||||
| SHAREHOLDERS' EQUITY: | ||||||||||||||||||||
| Common stock | 19,837 | 20,154 | 20,378 | 20,337 | 20,218 | |||||||||||||||
| Capital surplus | 491,878 | 504,165 | 512,284 | 510,797 | 507,948 | |||||||||||||||
| Retained earnings | 307,975 | 296,477 | 282,896 | 267,092 | 247,966 | |||||||||||||||
| Accumulated other comprehensive (loss) income | (163,388 | ) | (115,467 | ) | (63,618 | ) | 18,242 | 22,460 | ||||||||||||
| Total shareholders' equity | 656,302 | 705,329 | 751,940 | 816,468 | 798,592 | |||||||||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 6,730,342 | $ | 6,731,764 | $ | 7,149,363 | $ | 7,104,954 | $ | 6,759,761 | ||||||||||
Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | September 30 | September 30 | ||||||||||||||||||
| (Dollars in thousands, except per share data) | ||||||||||||||||||||||||
| INTEREST INCOME: | ||||||||||||||||||||||||
| Loans, including fees | $ | 58,025 | $ | 53,835 | $ | 52,370 | $ | 56,855 | $ | 58,176 | $ | 164,230 | $ | 173,858 | ||||||||||
| Securities: | ||||||||||||||||||||||||
| Taxable | 6,655 | 5,571 | 5,068 | 3,933 | 2,998 | 17,294 | 7,956 | |||||||||||||||||
| Tax-exempt | 2,594 | 2,557 | 2,525 | 2,526 | 2,498 | 7,676 | 7,383 | |||||||||||||||||
| Deposits in other financial institutions | 608 | 877 | 340 | 317 | 221 | 1,825 | 356 | |||||||||||||||||
| Total interest income | 67,882 | 62,840 | 60,303 | 63,631 | 63,893 | 191,025 | 189,553 | |||||||||||||||||
| INTEREST EXPENSE: | ||||||||||||||||||||||||
| Demand, money market and savings deposits | 3,527 | 1,859 | 1,347 | 1,277 | 1,267 | 6,733 | 4,088 | |||||||||||||||||
| Certificates and other time deposits | 1,664 | 1,922 | 2,156 | 2,391 | 2,583 | 5,742 | 9,237 | |||||||||||||||||
| Borrowed funds | 499 | 114 | 186 | 434 | 436 | 799 | 1,444 | |||||||||||||||||
| Subordinated debt | 1,502 | 1,463 | 1,442 | 1,425 | 1,441 | 4,407 | 4,324 | |||||||||||||||||
| Total interest expense | 7,192 | 5,358 | 5,131 | 5,527 | 5,727 | 17,681 | 19,093 | |||||||||||||||||
| NET INTEREST INCOME | 60,690 | 57,482 | 55,172 | 58,104 | 58,166 | 173,344 | 170,460 | |||||||||||||||||
| Provision for credit losses | 1,962 | 2,143 | 1,814 | (2,577 | ) | 2,295 | 5,919 | 255 | ||||||||||||||||
| Net interest income after provision for credit losses | 58,728 | 55,339 | 53,358 | 60,681 | 55,871 | 167,425 | 170,205 | |||||||||||||||||
| NONINTEREST INCOME: | ||||||||||||||||||||||||
| Nonsufficient funds fees | 145 | 126 | 116 | 156 | 131 | 387 | 308 | |||||||||||||||||
| Service charges on deposit accounts | 527 | 560 | 527 | 476 | 425 | 1,614 | 1,195 | |||||||||||||||||
| Gain (loss) on sale of securities | 42 | (17 | ) | — | — | — | 25 | 49 | ||||||||||||||||
| Loss on sale of other real estate and repossessed assets | — | — | — | (89 | ) | — | — | (176 | ) | |||||||||||||||
| Bank owned life insurance | 135 | 342 | 133 | 139 | 125 | 610 | 415 | |||||||||||||||||
| Debit card and ATM card income | 869 | 880 | 819 | 834 | 771 | 2,568 | 2,162 | |||||||||||||||||
| Other | 1,277 | 813 | 2,423 | 938 | 647 | 4,513 | 2,155 | |||||||||||||||||
| Total noninterest income | 2,995 | 2,704 | 4,018 | 2,454 | 2,099 | 9,717 | 6,108 | |||||||||||||||||
NONINTEREST EXPENSE: | ||||||||||||||||||||||||
| Salaries and employee benefits | 22,013 | 21,864 | 22,728 | 22,918 | 22,335 | 66,605 | 67,259 | |||||||||||||||||
| Net occupancy and equipment | 2,129 | 2,220 | 2,205 | 2,194 | 2,335 | 6,554 | 6,950 | |||||||||||||||||
| Depreciation | 1,003 | 1,012 | 1,033 | 1,103 | 1,060 | 3,048 | 3,151 | |||||||||||||||||
| Data processing and software amortization | 2,541 | 2,522 | 2,498 | 2,264 | 2,222 | 7,561 | 6,598 | |||||||||||||||||
| Professional fees | 485 | 662 | 138 | 1,008 | 620 | 1,285 | 2,017 | |||||||||||||||||
| Regulatory assessments and FDIC insurance | 1,134 | 1,256 | 1,261 | 949 | 883 | 3,651 | 2,458 | |||||||||||||||||
| Core deposit intangibles amortization | 750 | 751 | 751 | 824 | 824 | 2,252 | 2,472 | |||||||||||||||||
| Communications | 359 | 363 | 341 | 395 | 358 | 1,063 | 1,011 | |||||||||||||||||
| Advertising | 385 | 483 | 462 | 481 | 481 | 1,330 | 1,211 | |||||||||||||||||
| Other real estate expense | 93 | 65 | 59 | 69 | 137 | 217 | 479 | |||||||||||||||||
| Acquisition and merger-related expenses | 10,551 | 1,667 | 451 | 1,408 | 603 | 12,669 | 603 | |||||||||||||||||
| Other | 2,588 | 5,039 | 2,590 | 3,131 | 2,438 | 10,217 | 8,601 | |||||||||||||||||
| Total noninterest expense | 44,031 | 37,904 | 34,517 | 36,744 | 34,296 | 116,452 | 102,810 | |||||||||||||||||
| INCOME BEFORE INCOME TAXES | 17,692 | 20,139 | 22,859 | 26,391 | 23,674 | 60,690 | 73,503 | |||||||||||||||||
| Provision for income taxes | 3,406 | 3,702 | 4,202 | 4,833 | 4,614 | 11,310 | 13,508 | |||||||||||||||||
| NET INCOME | $ | 14,286 | $ | 16,437 | $ | 18,657 | $ | 21,558 | $ | 19,060 | $ | 49,380 | $ | 59,995 | ||||||||||
| EARNINGS PER SHARE | ||||||||||||||||||||||||
| Basic | $ | 0.72 | $ | 0.81 | $ | 0.92 | $ | 1.06 | $ | 0.94 | $ | 2.44 | $ | 2.97 | ||||||||||
| Diluted | $ | 0.71 | $ | 0.80 | $ | 0.91 | $ | 1.06 | $ | 0.93 | $ | 2.42 | $ | 2.95 | ||||||||||
Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||
| September 30, 2022 | June 30, 2022 | September 30, 2021 | |||||||||||||||||||||||||||
| Average Balance | Interest Earned/ Interest Paid | Average Yield/ Rate | Average Balance | Interest Earned/ Interest Paid | Average Yield/ Rate | Average Balance | Interest Earned/ Interest Paid | Average Yield/ Rate | |||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||
| Interest-Earning Assets: | |||||||||||||||||||||||||||||
| Loans | $ | 4,456,174 | $ | 58,025 | 5.17 | % | $ | 4,303,714 | $ | 53,835 | 5.02 | % | $ | 4,336,443 | $ | 58,176 | 5.32 | % | |||||||||||
| Securities | 1,709,470 | 9,249 | 2.15 | % | 1,778,745 | 8,128 | 1.83 | % | 1,070,851 | 5,496 | 2.04 | % | |||||||||||||||||
| Deposits in other financial institutions | 160,340 | 608 | 1.50 | % | 535,546 | 877 | 0.66 | % | 588,859 | 221 | 0.15 | % | |||||||||||||||||
| Total interest-earning assets | 6,325,984 | $ | 67,882 | 4.26 | % | 6,618,005 | $ | 62,840 | 3.81 | % | 5,996,153 | $ | 63,893 | 4.23 | % | ||||||||||||||
| Allowance for credit losses on loans | (50,609 | ) | (49,290 | ) | (49,381 | ) | |||||||||||||||||||||||
| Noninterest-earning assets | 442,511 | 450,584 | 680,682 | ||||||||||||||||||||||||||
| Total assets | $ | 6,717,886 | $ | 7,019,299 | $ | 6,627,454 | |||||||||||||||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||||||||||||||||
| Interest-Bearing Liabilities: | |||||||||||||||||||||||||||||
| Interest-bearing demand deposits | $ | 978,531 | $ | 2,380 | 0.96 | % | $ | 1,044,493 | $ | 927 | 0.36 | % | $ | 576,144 | $ | 324 | 0.22 | % | |||||||||||
| Money market and savings deposits | 1,500,083 | 1,147 | 0.30 | % | 1,566,376 | 932 | 0.24 | % | 1,565,965 | 943 | 0.24 | % | |||||||||||||||||
| Certificates and other time deposits | 877,231 | 1,664 | 0.75 | % | 1,088,664 | 1,922 | 0.71 | % | 1,363,121 | 2,583 | 0.75 | % | |||||||||||||||||
| Borrowed funds | 68,752 | 499 | 2.88 | % | 50,116 | 114 | 0.91 | % | 139,844 | 436 | 1.24 | % | |||||||||||||||||
| Subordinated debt | 109,177 | 1,502 | 5.46 | % | 109,045 | 1,463 | 5.38 | % | 108,652 | 1,441 | 5.26 | % | |||||||||||||||||
| Total interest-bearing liabilities | 3,533,774 | $ | 7,192 | 0.81 | % | 3,858,694 | $ | 5,358 | 0.56 | % | 3,753,726 | $ | 5,727 | 0.61 | % | ||||||||||||||
| Noninterest-Bearing Liabilities: | |||||||||||||||||||||||||||||
| Noninterest-bearing demand deposits | 2,424,884 | 2,382,230 | 2,031,399 | ||||||||||||||||||||||||||
| Other liabilities | 41,792 | 34,249 | 42,183 | ||||||||||||||||||||||||||
| Total liabilities | 6,000,450 | 6,275,173 | 5,827,308 | ||||||||||||||||||||||||||
| Shareholders' equity | 717,436 | 744,126 | 800,146 | ||||||||||||||||||||||||||
| Total liabilities and shareholders' equity | $ | 6,717,886 | $ | 7,019,299 | $ | 6,627,454 | |||||||||||||||||||||||
| Net interest rate spread | 3.45 | % | 3.25 | % | 3.62 | % | |||||||||||||||||||||||
| Net interest income and margin | $ | 60,690 | 3.81 | % | $ | 57,482 | 3.48 | % | $ | 58,166 | 3.85 | % | |||||||||||||||||
| Net interest income and net interest margin (tax equivalent) | $ | 61,418 | 3.85 | % | $ | 58,238 | 3.53 | % | $ | 58,873 | 3.90 | % | |||||||||||||||||
Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
| Nine Months Ended September 30, | |||||||||||||||||||
| 2022 | 2021 | ||||||||||||||||||
| Average Balance | Interest Earned/ Interest Paid | Average Yield/ Rate | Average Balance | Interest Earned/ Interest Paid | Average Yield/Rate | ||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||
| Assets | |||||||||||||||||||
| Interest-Earning Assets: | |||||||||||||||||||
| Loans | $ | 4,331,288 | $ | 164,230 | 5.07 | % | $ | 4,482,684 | $ | 173,858 | 5.19 | % | |||||||
| Securities | 1,774,149 | 24,970 | 1.88 | % | 913,078 | 15,339 | 2.25 | % | |||||||||||
| Deposits in other financial institutions | 498,456 | 1,825 | 0.49 | % | 328,238 | 356 | 0.15 | % | |||||||||||
| Total interest-earning assets | 6,603,893 | $ | 191,025 | 3.87 | % | 5,724,000 | $ | 189,553 | 4.43 | % | |||||||||
| Allowance for credit losses on loans | (49,422 | ) | (51,802 | ) | |||||||||||||||
| Noninterest-earning assets | 441,767 | 758,774 | |||||||||||||||||
| Total assets | $ | 6,996,238 | $ | 6,430,972 | |||||||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||||||
| Interest-Bearing Liabilities: | |||||||||||||||||||
| Interest-bearing demand deposits | $ | 1,031,006 | $ | 3,856 | 0.50 | % | $ | 523,272 | $ | 1,021 | 0.26 | % | |||||||
| Money market and savings deposits | 1,549,969 | 2,877 | 0.25 | % | 1,555,791 | 3,067 | 0.26 | % | |||||||||||
| Certificates and other time deposits | 1,069,011 | 5,742 | 0.72 | % | 1,354,000 | 9,237 | 0.91 | % | |||||||||||
| Borrowed funds | 69,492 | 799 | 1.54 | % | 146,244 | 1,444 | 1.32 | % | |||||||||||
| Subordinated debt | 109,046 | 4,407 | 5.40 | % | 108,522 | 4,324 | 5.33 | % | |||||||||||
| Total interest-bearing liabilities | 3,828,524 | $ | 17,681 | 0.62 | % | 3,687,829 | 19,093 | 0.69 | % | ||||||||||
| Noninterest-Bearing Liabilities: | |||||||||||||||||||
| Noninterest-bearing demand deposits | 2,373,489 | 1,923,584 | |||||||||||||||||
| Other liabilities | 39,123 | 40,568 | |||||||||||||||||
| Total liabilities | 6,241,136 | 5,651,981 | |||||||||||||||||
| Shareholders' equity | 755,102 | 778,991 | |||||||||||||||||
| Total liabilities and shareholders' equity | $ | 6,996,238 | $ | 6,430,972 | |||||||||||||||
| Net interest rate spread | 3.25 | % | 3.74 | % | |||||||||||||||
| Net interest income and margin | $ | 173,344 | 3.51 | % | $ | 170,460 | 3.98 | % | |||||||||||
| Net interest income and net interest margin (tax equivalent) | $ | 175,578 | 3.55 | % | $ | 172,477 | 4.03 | % | |||||||||||
Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
| Three Months Ended | |||||||||||||||||||
| 2022 | 2021 | ||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | |||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||
| Period-end Loan Portfolio: | |||||||||||||||||||
| Commercial and industrial | $ | 732,636 | $ | 727,068 | $ | 714,450 | $ | 693,559 | $ | 728,897 | |||||||||
| Paycheck Protection Program (PPP) | 17,827 | 31,855 | 78,624 | 145,942 | 290,028 | ||||||||||||||
| Real estate: | |||||||||||||||||||
| Commercial real estate (including multi-family residential) | 2,407,039 | 2,265,155 | 2,197,502 | 2,104,621 | 2,073,521 | ||||||||||||||
| Commercial real estate construction and land development | 513,248 | 450,694 | 453,473 | 439,125 | 382,610 | ||||||||||||||
| 1-4 family residential (including home equity) | 699,636 | 682,066 | 669,306 | 685,071 | 683,919 | ||||||||||||||
| Residential construction | 183,563 | 155,017 | 136,760 | 117,901 | 104,638 | ||||||||||||||
| Consumer and other | 37,963 | 36,978 | 33,399 | 34,267 | 25,856 | ||||||||||||||
| Total loans | $ | 4,591,912 | $ | 4,348,833 | $ | 4,283,514 | $ | 4,220,486 | $ | 4,289,469 | |||||||||
| Deposits: | |||||||||||||||||||
| Interest-bearing demand accounts | $ | 956,920 | $ | 1,016,381 | $ | 1,070,855 | $ | 869,984 | $ | 594,959 | |||||||||
| Money market and savings | 1,471,690 | 1,510,008 | 1,552,853 | 1,643,745 | 1,604,222 | ||||||||||||||
| Certificates and other time | 766,270 | 959,524 | 1,185,015 | 1,290,825 | 1,381,014 | ||||||||||||||
| Total interest-bearing deposits | 3,194,880 | 3,485,913 | 3,808,723 | 3,804,554 | 3,580,195 | ||||||||||||||
| Noninterest-bearing deposits | 2,465,839 | 2,394,719 | 2,353,604 | 2,243,085 | 2,086,683 | ||||||||||||||
| Total deposits | $ | 5,660,719 | $ | 5,880,632 | $ | 6,162,327 | $ | 6,047,639 | $ | 5,666,878 | |||||||||
| Asset Quality: | |||||||||||||||||||
| Nonaccrual loans | $ | 21,551 | $ | 28,225 | $ | 26,275 | $ | 24,127 | $ | 28,369 | |||||||||
| Accruing loans 90 or more days past due | — | — | — | — | — | ||||||||||||||
| Total nonperforming loans | 21,551 | 28,225 | 26,275 | 24,127 | 28,369 | ||||||||||||||
| Other real estate | — | — | — | — | 1,397 | ||||||||||||||
| Total nonperforming assets | $ | 21,551 | $ | 28,225 | $ | 26,275 | $ | 24,127 | $ | 29,766 | |||||||||
| Net (recoveries) charge-offs | $ | (245 | ) | $ | 571 | $ | 317 | $ | 1,353 | $ | 450 | ||||||||
| Nonaccrual loans: | |||||||||||||||||||
| Commercial and industrial | $ | 6,916 | $ | 9,145 | $ | 7,809 | $ | 8,358 | $ | 10,247 | |||||||||
| Real estate: | |||||||||||||||||||
| Commercial real estate (including multi-family residential) | 10,392 | 14,409 | 15,259 | 12,639 | 14,629 | ||||||||||||||
| Commercial real estate construction and land development | 241 | 1,511 | — | 63 | 53 | ||||||||||||||
| 1-4 family residential (including home equity) | 3,854 | 3,040 | 3,065 | 2,875 | 3,224 | ||||||||||||||
| Residential construction | — | — | — | — | — | ||||||||||||||
| Consumer and other | 148 | 120 | 142 | 192 | 216 | ||||||||||||||
| Total nonaccrual loans | $ | 21,551 | $ | 28,225 | $ | 26,275 | $ | 24,127 | $ | 28,369 | |||||||||
| Asset Quality Ratios: | |||||||||||||||||||
| Nonperforming assets to total assets | 0.32 | % | 0.42 | % | 0.37 | % | 0.34 | % | 0.44 | % | |||||||||
| Nonperforming loans to total loans | 0.47 | % | 0.65 | % | 0.61 | % | 0.57 | % | 0.66 | % | |||||||||
| Allowance for credit losses on loans to nonperforming loans | 241.97 | % | 178.01 | % | 187.31 | % | 198.70 | % | 177.98 | % | |||||||||
| Allowance for credit losses on loans to total loans | 1.14 | % | 1.16 | % | 1.15 | % | 1.14 | % | 1.18 | % | |||||||||
| Net (recoveries) charge-offs to average loans (annualized) | (0.02 | %) | 0.05 | % | 0.03 | % | 0.13 | % | 0.04 | % | |||||||||
Allegiance Bancshares, Inc.
GAAP Reconciliation and Management's Explanation of Non-GAAP Financial Measures
(Unaudited)
Allegiance's management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Allegiance believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and that management and investors benefit from referring to these non-GAAP financial measures in assessing Allegiance's performance and when planning, forecasting, analyzing and comparing past, present and future periods. Specifically, Allegiance reviews pre-tax, pre-provision income, adjusted pre-tax, pre-provision income, adjusted efficiency ratio, tangible book value per share, return on average tangible equity and the ratio of tangible equity to tangible assets for internal planning and forecasting purposes. Allegiance has included in this Earnings Release information relating to these non-GAAP financial measures for the applicable periods presented. These non-GAAP measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which Allegiance calculates the non-GAAP financial measures may differ from that of other companies reporting measures with similar names.
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||
| September 30 | June 30 | March 31 | December 31 | September 30 | September 30 | September 30 | |||||||||||||||||||||
| (Dollars and share amounts in thousands, except per share data) | |||||||||||||||||||||||||||
| Net income | $ | 14,286 | $ | 16,437 | $ | 18,657 | $ | 21,558 | $ | 19,060 | $ | 49,380 | $ | 59,995 | |||||||||||||
| Add: Provision for credit losses | 1,962 | 2,143 | 1,814 | (2,577 | ) | 2,295 | 5,919 | 255 | |||||||||||||||||||
| Add: Provision for income taxes | 3,406 | 3,702 | 4,202 | 4,833 | 4,614 | 11,310 | 13,508 | ||||||||||||||||||||
| Pre-tax, pre-provision income | $ | 19,654 | $ | 22,282 | $ | 24,673 | $ | 23,814 | $ | 25,969 | $ | 66,609 | $ | 73,758 | |||||||||||||
| Pre-tax, pre-provision income | $ | 19,654 | $ | 22,282 | $ | 24,673 | $ | 23,814 | $ | 25,969 | $ | 66,609 | $ | 73,758 | |||||||||||||
| Add: Acquisition and merger-related expenses | 10,551 | 1,667 | 451 | 1,408 | 603 | 12,669 | 603 | ||||||||||||||||||||
| Adjusted pre-tax, pre-provision income | $ | 30,205 | $ | 23,949 | $ | 25,124 | $ | 25,222 | $ | 26,572 | $ | 79,278 | $ | 74,361 | |||||||||||||
| Total noninterest expense | $ | 44,031 | $ | 37,904 | $ | 34,517 | $ | 36,744 | $ | 34,296 | $ | 116,452 | $ | 102,810 | |||||||||||||
| Acquisition and merger-related expenses | 10,551 | 1,667 | 451 | 1,408 | 603 | 12,669 | 603 | ||||||||||||||||||||
| Net interest income | 60,690 | 57,482 | 55,172 | 58,104 | 58,166 | 173,344 | 170,460 | ||||||||||||||||||||
| Total noninterest income | 2,995 | 2,704 | 4,018 | 2,454 | 2,099 | 9,717 | 6,108 | ||||||||||||||||||||
| Gain on sale of securities | 42 | (17 | ) | — | — | — | 25 | 49 | |||||||||||||||||||
| Adjusted efficiency ratio(A) | 52.61 | % | 60.19 | % | 57.55 | % | 58.35 | % | 55.91 | % | 56.69 | % | 57.87 | % | |||||||||||||
| Total shareholders' equity | $ | 656,302 | $ | 705,329 | $ | 751,940 | $ | 816,468 | $ | 798,592 | $ | 656,302 | $ | 798,592 | |||||||||||||
| Less: Goodwill and core deposit intangibles, net | 236,048 | 236,798 | 237,549 | 238,300 | 239,124 | 236,048 | 239,124 | ||||||||||||||||||||
| Tangible shareholders' equity | $ | 420,254 | $ | 468,531 | $ | 514,391 | $ | 578,168 | $ | 559,468 | $ | 420,254 | $ | 559,468 | |||||||||||||
| Shares outstanding at end of period | 19,837 | 20,154 | 20,378 | 20,337 | 20,218 | 19,837 | 20,218 | ||||||||||||||||||||
| Tangible book value per share | $ | 21.19 | $ | 23.25 | $ | 25.24 | $ | 28.43 | $ | 27.67 | $ | 21.19 | $ | 27.67 | |||||||||||||
| Net income | $ | 14,286 | $ | 16,437 | $ | 18,657 | $ | 21,558 | $ | 19,060 | $ | 49,380 | $ | 59,995 | |||||||||||||
| Average shareholders' equity | $ | 717,436 | $ | 744,126 | $ | 804,704 | $ | 806,941 | $ | 800,146 | $ | 755,102 | $ | 778,991 | |||||||||||||
| Less: Average goodwill and core deposit intangibles, net | 236,399 | 237,153 | 237,925 | 238,700 | 239,497 | 237,153 | 240,325 | ||||||||||||||||||||
| Average tangible shareholders' equity | $ | 481,037 | $ | 506,973 | $ | 566,779 | $ | 568,241 | $ | 560,649 | $ | 517,949 | $ | 538,666 | |||||||||||||
| Return on average tangible equity(B) | 11.78 | % | 13.00 | % | 13.35 | % | 15.05 | % | 13.49 | % | 12.75 | % | 14.89 | % | |||||||||||||
| Total assets | $ | 6,730,342 | $ | 6,731,764 | $ | 7,149,363 | $ | 7,104,954 | $ | 6,759,761 | $ | 6,730,342 | $ | 6,759,761 | |||||||||||||
| Less: Goodwill and core deposit intangibles, net | 236,048 | 236,798 | 237,549 | 238,300 | 239,124 | 236,048 | 239,124 | ||||||||||||||||||||
| Tangible assets | $ | 6,494,294 | $ | 6,494,966 | $ | 6,911,814 | $ | 6,866,654 | $ | 6,520,637 | $ | 6,494,294 | $ | 6,520,637 | |||||||||||||
| Tangible equity to tangible assets | 6.47 | % | 7.21 | % | 7.44 | % | 8.42 | % | 8.58 | % | 6.47 | % | 8.58 | % | |||||||||||||
(A) Represents total noninterest expense, excluding acquisition and merger-related expenses, divided by the sum of net interest income plus noninterest income, excluding net gains and losses on the sale of loans, securities and assets. Additionally, taxes and provision for credit losses are not part of this calculation.
(B) Interim periods annualized.
