CHICO, Calif.--(BUSINESS WIRE)--TriCo Bancshares (NASDAQ: TCBK) (the “Company”), parent company of Tri Counties Bank, today announced net income of $23,395,000 for the quarter ended September 30, 2019, compared to $23,061,000 during the trailing quarter ended June 30, 2019 and $16,170,000 during the quarter ended September 30, 2018. Diluted earnings per share were $0.76 for the third quarter of 2019, compared to $0.75 for the second quarter of 2019 and $0.53 for the third quarter of 2018.
Financial Highlights
Performance highlights and other developments for the Company as of or for the three and nine months ended September 30, 2019 included the following:
- For the three and nine months ended September 30, 2019, the Company’s return on average assets was 1.44% and 1.44%, respectively, and the return on average equity was 10.42% and 10.67%, respectively.
- As of September 30, 2019, the Company reported total loans, total assets and total deposits of $4.18 billion, $6.38 billion and $5.30 billion, respectively.
- The loan to deposit ratio was 79.0% as of September 30, 2019 as compared to 76.8% at June 30, 2019 and 79.0% at September 30, 2018.
- For the current quarter, net interest margin was 4.44% on a tax equivalent basis as compared to 4.29% in the quarter ended September 30, 2018 and decreased 6 basis points from the trailing quarter.
- Non-interest bearing deposits as a percentage of total deposits were 33.6% at September 30, 2019, as compared to 33.3% at June 30, 2019 and 33.6% at September 30, 2018.
- The average rate of interest paid on deposits, including non-interest-bearing deposits, remained low but increased slightly to 0.23% for the third quarter of 2019 as compared with 0.22% for the trailing quarter, and an increase of 7 basis points from the average rate paid during the same quarter of the prior year.
- Non-performing assets to total assets were 0.31% at September 30, 2019, as compared to 0.35% as of June 30, 2019, and 0.47% at December 31, 2018.
- The balance of nonperforming loans decreased by $2.0 million, and was facilitated by the sale of loans and charge-offs. Net charge-offs (recoveries) for the quarter ended September 30, 2019 and 2018 were $1.0 million and ($0.2) million, respectively, while net charge-offs (recoveries) for the nine months ended September 30, 2019 were ($0.3) million and $0.5 million, respectively.
- The efficiency ratio declined to 58.8%, as compared to 60.1%, in the trailing quarter and 65.3% in the same quarter of the 2018 year. Excluding merger and acquisition costs from the 2018 year results in an efficiency ratio of 59.56%.
- Non-interest income associated with service charges and fees increased by 4.6% over the trailing quarter and 8.7% over the same quarter in the prior year.
President and CEO, Rick Smith commented, “Our record earnings for the third quarter were a direct result of a full team effort across every department of the Bank. We increased our loan to deposit ratio through a reduction in investment security balances whose proceeds were utilized to fund loan growth. In addition, through asset sales, we accomplished a substantial reduction in nonperforming loans and underperforming municipal investment securities. Our mortgage loan processors pushed forward at near capacity levels resulting in almost a doubling of gains from the sale of loans as compared to the trailing quarter. The market leading cash management services we offer continue to drive growth in transaction volume and the number of customers we serve. Further, we continue to focus on cost containment and increased efficiency measures. We believe that the continued execution of these and other strategies combined with our long history paying quarterly cash dividends, which were recently increased to $0.22 per share, create a noteworthy value proposition for our shareholders.”
Summary Results
For the three and nine months ended September 30, 2019, the Company’s return on average assets was 1.44% and 1.44%, respectively, and the return on average equity was 10.42% and 10.67%, respectively. For the three and nine months ended September 30, 2018, the Company’s return on average assets was 1.05% and 1.15%, respectively, and the return on average equity was 9.11% and 10.44%, respectively. While there were no merger and acquisition expenses incurred during the 2019 periods as compared to $4,150,000 and $5,227,000 during the three and nine months ended September 30, 2018, the increases in return on average assets and average equity were also benefited by increases in net interest income of $4,199,000 and $41,529,000, respectively, during the three and nine months ended September 30, 2019.
The following is a summary of the components of the Company’s operating results and performance ratios for the periods indicated:
|
Three months ended |
|
|
|
|
|||||||||||
|
September 30, |
|
June 30, |
|
|
|
|
|||||||||
(dollars and shares in thousands) |
|
2019 |
|
|
|
2019 |
|
|
$ Change |
|
% Change |
|||||
Net interest income |
|
64,688 |
|
|
$ |
64,315 |
|
|
$ |
373 |
|
|
0.6 |
% |
||
Reversal of (provision for) loan losses |
|
329 |
|
|
|
(537 |
) |
|
|
866 |
|
|
nm |
|||
Noninterest income |
|
14,108 |
|
|
|
13,423 |
|
|
|
685 |
|
|
5.1 |
% |
||
Noninterest expense |
|
(46,344 |
) |
|
|
(46,697 |
) |
|
|
353 |
|
|
(0.8 |
)% |
||
Provision for income taxes |
|
(9,386 |
) |
|
|
(7,443 |
) |
|
|
(1,943 |
) |
|
26.1 |
% |
||
Net income |
$ |
23,395 |
|
|
$ |
23,061 |
|
|
$ |
334 |
|
|
1.4 |
% |
||
Diluted earnings per share |
$ |
0.76 |
|
|
$ |
0.75 |
|
|
$ |
0.01 |
|
|
1.33 |
% |
||
Dividends per share |
$ |
0.22 |
|
|
$ |
0.19 |
|
|
$ |
0.03 |
|
|
15.80 |
% |
||
Average common shares |
|
30,509 |
|
|
|
30,458 |
|
|
|
51 |
|
|
0.2 |
% |
||
Average diluted common shares |
|
30,629 |
|
|
|
30,643 |
|
|
|
(14 |
) |
|
(0.0 |
)% |
||
Return on average total assets |
|
1.44 |
% |
|
|
1.45 |
% |
|
|
|
|
|||||
Return on average equity |
|
10.42 |
% |
|
|
10.68 |
% |
|
|
|
|
|||||
Efficiency ratio |
|
58.82 |
% |
|
|
60.07 |
% |
|
|
|
|
|||||
|
Three months ended
|
|
|
|
|
|||||||||||
(dollars and shares in thousands) |
|
2019 |
|
|
|
2018 |
|
|
$ Change |
|
% Change |
|||||
Net interest income |
|
64,688 |
|
|
$ |
60,489 |
|
|
$ |
4,199 |
|
|
6.9 |
% |
||
Reversal of (provision for) loan losses |
|
329 |
|
|
|
(2,651 |
) |
|
|
2,980 |
|
|
nm |
|||
Noninterest income |
|
14,108 |
|
|
|
12,336 |
|
|
|
1,772 |
|
|
14.4 |
% |
||
Noninterest expense |
|
(46,344 |
) |
|
|
(47,528 |
) |
|
|
1,184 |
|
|
(2.5 |
)% |
||
Provision for income taxes |
|
(9,386 |
) |
|
|
(6,476 |
) |
|
|
(2,910 |
) |
|
44.9 |
% |
||
Net income |
$ |
23,395 |
|
|
$ |
16,170 |
|
|
$ |
7,225 |
|
|
44.7 |
% |
||
Diluted earnings per share |
$ |
0.76 |
|
|
$ |
0.53 |
|
|
$ |
0.23 |
|
|
43.4 |
% |
||
Dividends per share |
$ |
0.22 |
|
|
$ |
0.17 |
|
|
$ |
0.05 |
|
|
29.4 |
% |
||
Average common shares |
|
30,509 |
|
|
|
30,011 |
|
|
|
498 |
|
|
1.7 |
% |
||
Average diluted common shares |
|
30,629 |
|
|
|
30,291 |
|
|
|
338 |
|
|
1.1 |
% |
||
Return on average total assets |
|
1.44 |
% |
|
|
1.05 |
% |
|
|
|
|
|||||
Return on average equity |
|
10.42 |
% |
|
|
9.11 |
% |
|
|
|
|
|||||
Efficiency ratio |
|
58.82 |
% |
|
|
65.26 |
% |
|
|
|
|
|||||
|
Nine months ended
|
|
|
|
|
|||||||||||
(dollars and shares in thousands) |
|
2019 |
|
|
|
2018 |
|
|
$ Change |
|
% Change |
|||||
Net interest income |
$ |
192,873 |
|
|
$ |
151,344 |
|
|
$ |
41,529 |
|
|
27.4 |
% |
||
Reversal of (provision for) loan losses |
|
1,392 |
|
|
|
(1,777 |
) |
|
|
3,169 |
|
|
nm |
|||
Noninterest income |
|
39,334 |
|
|
|
36,466 |
|
|
|
2,868 |
|
|
7.9 |
% |
||
Noninterest expense |
|
(138,493 |
) |
|
|
(123,226 |
) |
|
|
(15,267 |
) |
|
12.4 |
% |
||
Provision for income taxes |
|
(25,924 |
) |
|
|
(17,698 |
) |
|
|
(8,226 |
) |
|
46.5 |
% |
||
Net income |
$ |
69,182 |
|
|
$ |
45,109 |
|
|
$ |
17,735 |
|
|
53.4 |
% |
||
Diluted earnings per share |
$ |
2.25 |
|
|
$ |
1.76 |
|
|
$ |
0.49 |
|
|
27.8 |
% |
||
Dividends per share |
$ |
0.60 |
|
|
$ |
0.51 |
|
|
$ |
0.09 |
|
|
17.6 |
% |
||
Average common shares |
|
30,441 |
|
|
|
25,317 |
|
|
|
5,124 |
|
|
20.2 |
% |
||
Average diluted common shares |
|
30,650 |
|
|
|
25,617 |
|
|
|
5,033 |
|
|
19.6 |
% |
||
Return on average total assets |
|
1.44 |
% |
|
|
1.15 |
% |
|
|
|
|
|||||
Return on average equity |
|
10.67 |
% |
|
|
10.44 |
% |
|
|
|
|
|||||
Efficiency ratio |
|
59.64 |
% |
|
|
65.65 |
% |
|
|
|
|
|||||
Balance Sheet
Total loans outstanding reached a record high of $4.18 billion as of September 30, 2019, an increase of 3.8% over the trailing twelve month period and an annualized increase of 7.7% over the trailing quarter. In general, year over year increases in deposit balances and reductions in investment security balances were utilized to fund loan growth and pay down outstanding balances of other borrowings.
The retention of earnings generated from the balance sheet changes discussed below was the primary driver in total equity increasing to $896,665,000 at September 30, 2019 as compared to $875,886,000 at June 30, 2019, which is inclusive of $1,499,000 and $(2,198,000) in accumulated other comprehensive income (loss) at the same periods, respectively. As a result, the Company’s book value per share increased to $29.39 per share at September 30, 2019 from $28.71 at June 30, 2019. The Company’s tangible book value per share, calculated by subtracting goodwill and other intangible assets from total shareholders’ equity and dividing that sum by total shares outstanding, increased to $21.33 per share at September 30, 2019 from $20.60 per share June 30, 2019. Excluding accumulated other comprehensive losses from total equity for both quarters, tangible book value per share increased to $21.28 at September 30, 2019 from $20.68 at June 30, 2019.
Trailing Quarter Balance Sheet Change |
|||||||||||||
Ending balances |
As of September 30, |
|
As of June 30, |
|
$ Change |
|
Annualized
|
||||||
($’s in thousands) |
2019 |
|
2019 |
|
|||||||||
Total assets |
$ |
6,384,883 |
|
$ |
6,395,172 |
|
$ |
(10,289 |
) |
|
(0.6 |
)% |
|
Total loans |
|
4,182,348 |
|
|
4,103,687 |
|
|
78,661 |
|
|
7.7 |
% |
|
Total investments |
|
1,397,753 |
|
|
1,566,720 |
|
|
(168,967 |
) |
|
(43.1 |
)% |
|
Total deposits |
$ |
5,295,407 |
|
$ |
5,342,173 |
|
$ |
(46,766 |
) |
|
(3.5 |
)% |
|
Loan growth of $78,661,000 or 7.7% on an annualized basis during the third quarter of 2019 provided benefit to the yield on earning assets and net interest margin as prepayments and sales of investment securities were utilized to fund loans and to reduce the need for overnight borrowings from the Federal Home Loan Bank.
Average Trailing Quarter Balance Sheet Change |
|||||||||||||
Qtrly avg balances |
As of September 30, |
|
As of June 30, |
|
$ Change |
|
Annualized
|
||||||
($’s in thousands) |
2019 |
|
2019 |
|
|||||||||
Total assets |
$ |
6,452,470 |
|
$ |
6,385,889 |
|
$ |
66,581 |
|
|
4.2 |
% |
|
Total loans |
|
4,142,602 |
|
|
4,044,044 |
|
|
98,558 |
|
|
9.7 |
% |
|
Total investments |
|
1,536,691 |
|
|
1,573,112 |
|
|
(36,421 |
) |
|
(9.3 |
)% |
|
Total deposits |
$ |
5,327,235 |
|
$ |
5,370,879 |
|
$ |
(43,644 |
) |
|
(3.3 |
)% |
|
The growth in average loans of $98,558,000 or 9.7%, on an annualized basis, during the third quarter was greater than the end of period growth as nearly all of the growth for the second quarter occurred during the month of June and third quarter growth was concentrated in July and August.
Year Over Year Balance Sheet Change |
||||||||||||||
Ending balances |
As of September 30, |
|
|
|
|
|
||||||||
($’s in thousands) |
2019 |
|
2018 |
|
$ Change |
|
|
% Change |
||||||
Total assets |
$ |
6,384,883 |
|
$ |
6,318,865 |
|
$ |
66,018 |
|
|
|
1.0 |
% |
|
Total loans |
|
4,182,348 |
|
|
4,027,436 |
|
|
154,912 |
|
|
|
3.8 |
% |
|
Total investments |
|
1,397,753 |
|
|
1,535,953 |
|
|
(138,200 |
) |
|
|
(9.0 |
)% |
|
Total deposits |
$ |
5,295,407 |
|
$ |
5,093,117 |
|
$ |
202,290 |
|
|
|
4.0 |
% |
|
Total assets have grown by $66,018,000 or 1.0% between September 2018 and September 2019. This growth was led by $154,912,000 or 3.8% in loan growth which was funded by $202,290,000 or 4.0% in deposit growth. Deposit growth in excess of loan growth and the reduction in investment security balances was utilized to reduce other borrowings.
Net Interest Income and Net Interest Margin
The following is a summary of the components of net interest income for the periods indicated:
|
Three months ended |
|
|
|
|
||||||||||
|
September 30, |
|
June 30, |
|
|
|
|
||||||||
(dollars in thousands) |
|
2019 |
|
|
|
2019 |
|
|
$ Change |
|
% Change |
||||
Interest income |
$ |
68,889 |
|
|
$ |
68,180 |
|
|
$ |
709 |
|
|
1.0 |
% |
|
Interest expense |
|
(4,201 |
) |
|
|
(3,865 |
) |
|
|
(336 |
) |
|
8.7 |
% |
|
Fully tax-equivalent adjustment (FTE) (1) |
|
289 |
|
|
|
298 |
|
|
|
(9 |
) |
|
(3.0 |
)% |
|
Net interest income (FTE) |
$ |
64,977 |
|
|
$ |
64,613 |
|
|
$ |
364 |
|
|
0.6 |
% |
|
Net interest margin (FTE) |
|
4.44 |
% |
|
|
4.50 |
% |
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Acquired loans discount accretion, net: |
|
|
|
|
|
|
|
||||||||
Amount (included in interest income) |
$ |
2,360 |
|
|
$ |
1,904 |
|
|
$ |
456 |
|
|
23.9 |
% |
|
Effect on average loan yield |
|
0.23 |
% |
|
|
0.19 |
% |
|
|
|
|
||||
Effect on net interest margin (FTE) |
|
0.16 |
% |
|
|
0.13 |
% |
|
|
|
|
||||
|
Three months ended
|
|
|
|
|
||||||||||
(dollars in thousands) |
|
2019 |
|
|
|
2018 |
|
|
$ Change |
|
% Change |
||||
Interest income |
$ |
68,889 |
|
|
$ |
64,554 |
|
|
$ |
4,335 |
|
|
6.7 |
% |
|
Interest expense |
|
(4,201 |
) |
|
|
(4,065 |
) |
|
|
(136 |
) |
|
3.3 |
% |
|
Fully tax-equivalent adjustment (FTE) (1) |
|
289 |
|
|
|
357 |
|
|
|
(68 |
) |
|
(19.0 |
)% |
|
Net interest income (FTE) |
$ |
64,977 |
|
|
$ |
60,846 |
|
|
$ |
4,131 |
|
|
6.8 |
% |
|
Net interest margin (FTE) |
|
4.44 |
% |
|
|
4.29 |
% |
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Acquired loans discount accretion, net: |
|
|
|
|
|
|
|
||||||||
Amount (included in interest income) |
$ |
2,360 |
|
|
$ |
2,098 |
|
|
$ |
262 |
|
|
12.5 |
% |
|
Effect on average loan yield |
|
0.23 |
% |
|
|
0.21 |
% |
|
|
|
|
||||
Effect on net interest margin (FTE) |
|
0.16 |
% |
|
|
0.14 |
% |
|
|
|
|
||||
|
Nine months ended September 30, |
|
|
|
|
||||||||||
(dollars in thousands) |
|
2019 |
|
|
|
2018 |
|
|
$ Change |
|
% Change |
||||
Interest income |
$ |
204,526 |
|
|
$ |
160,153 |
|
|
$ |
44,373 |
|
|
27.7 |
% |
|
Interest expense |
|
(11,653 |
) |
|
|
(8,809 |
) |
|
|
(2,844 |
) |
|
32.3 |
% |
|
Fully tax-equivalent adjustment (FTE) (1) |
|
929 |
|
|
|
982 |
|
|
|
(53 |
) |
|
(5.4 |
)% |
|
Net interest income (FTE) |
$ |
193,802 |
|
|
$ |
152,326 |
|
|
$ |
41,476 |
|
|
27.2 |
% |
|
Net interest margin (FTE) |
|
4.48 |
% |
|
|
4.22 |
% |
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Acquired loans discount accretion, net: |
|
|
|
|
|
|
|
||||||||
Amount (included in interest income) |
$ |
5,919 |
|
|
$ |
3,289 |
|
|
$ |
2,630 |
|
|
80.0 |
% |
|
Effect on average loan yield |
|
0.19 |
% |
|
|
0.13 |
% |
|
|
0.06 |
% |
|
|
||
Effect on net interest margin (FTE) |
|
0.08 |
% |
|
|
0.05 |
% |
|
|
0.03 |
% |
|
|
||
(1) |
Information is presented on a fully tax-equivalent (FTE) basis. The Company believes the use of this non-generally accepted accounting principles (non-GAAP) measure provides additional clarity in assessing its results, and the presentation of these measures on a FTE basis is a common practice within the banking industry. |
|
Loans may be acquired at a premium or discount to par value, in which case, the premium is amortized (subtracted from) or accreted (added to) interest income over the remaining life of the loan. Generally, as time goes on, the effects of loan discount accretion and loan premium amortization decrease as the purchased loans mature or pay off early. Upon the early pay off of a loan, any remaining (unaccreted) discount or (unamortized) premium is immediately taken into interest income; and as loan payoffs may vary significantly from quarter to quarter, so may the impact of discount accretion and premium amortization on interest income. As a result of the declining rate environment, the prepayment rate of portfolio loans, inclusive of those acquired at a premium or discount, accelerated and this is evidenced by the 23.9% increase in discount accretion included in interest income during the third quarter of 2019 as compared to the trailing quarter. During the three months ended September 30, 2019, June 30, 2019 and March 31, 2019, purchased loan discount accretion was $2,360,000, $1,904,000, and $1,655,000, respectively. During the three months ended March 31, 2019, loans purchased at net premium several years ago were repaid prior to expected maturity resulting in approximately $259,000 of accelerated amortization.
The following table shows the components of net interest income and net interest margin on a fully tax-equivalent (FTE) basis for the quarterly periods indicated:
ANALYSIS OF CHANGE IN NET INTEREST MARGIN ON EARNING ASSETS |
|||||||||||||||||||||||||||
(unaudited, dollars in thousands) |
|||||||||||||||||||||||||||
|
|
Three Months Ended |
|
Three Months Ended |
|
Three Months Ended |
|||||||||||||||||||||
|
|
September 30, 2019 |
|
June 30, 2019 |
|
September 30, 2018 |
|||||||||||||||||||||
|
Average
|
|
Income/
|
|
Yield/
|
|
Average
|
|
Income/
|
|
Yield/
|
|
Average
|
|
Income/
|
|
Yield/
|
||||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans |
$ |
4,142,602 |
|
$ |
56,999 |
|
5.46 |
% |
|
$ |
4,044,044 |
|
$ |
55,491 |
|
5.50 |
% |
|
$ |
4,019,391 |
|
$ |
53,102 |
|
5.24 |
% |
|
Investments-taxable |
|
1,403,653 |
|
|
10,172 |
|
2.88 |
% |
|
|
1,432,550 |
|
|
10,763 |
|
3.01 |
% |
|
|
1,326,756 |
|
|
9,648 |
|
2.89 |
% |
|
Investments-nontaxable (1) |
|
133,038 |
|
|
1,250 |
|
3.73 |
% |
|
|
140,562 |
|
|
1,358 |
|
3.88 |
% |
|
|
163,309 |
|
|
1,546 |
|
3.76 |
% |
|
Total investments |
|
1,536,691 |
|
|
11,422 |
|
2.95 |
% |
|
|
1,573,112 |
|
|
12,121 |
|
3.14 |
% |
|
|
1,490,065 |
|
|
11,194 |
|
2.98 |
% |
|
Cash at Federal Reserve and other banks |
|
130,955 |
|
|
757 |
|
2.29 |
% |
|
|
147,810 |
|
|
866 |
|
2.35 |
% |
|
|
119,635 |
|
|
615 |
|
2.04 |
% |
|
Total earning assets |
|
5,810,248 |
|
|
69,178 |
|
4.72 |
% |
|
|
5,764,966 |
|
|
68,478 |
|
4.76 |
% |
|
|
5,629,091 |
|
|
64,911 |
|
4.57 |
% |
|
Other assets, net |
|
642,222 |
|
|
|
|
|
|
620,923 |
|
|
|
|
|
|
626,622 |
|
|
|
|
|||||||
Total assets |
$ |
6,452,470 |
|
|
|
|
|
$ |
6,385,889 |
|
|
|
|
|
$ |
6,255,713 |
|
|
|
|
|||||||
Liabilities and shareholders’ equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing demand deposits |
$ |
1,240,548 |
|
|
284 |
|
0.09 |
% |
|
$ |
1,276,388 |
|
|
289 |
|
0.09 |
% |
|
$ |
1,125,159 |
|
$ |
248 |
|
0.09 |
% |
|
Savings deposits |
|
1,861,166 |
|
|
1,192 |
|
0.25 |
% |
|
|
1,888,234 |
|
|
1,307 |
|
0.28 |
% |
|
|
1,803,022 |
|
|
833 |
|
0.18 |
% |
|
Time deposits |
|
447,669 |
|
|
1,574 |
|
1.39 |
% |
|
|
441,116 |
|
|
1,403 |
|
1.28 |
% |
|
|
430,286 |
|
|
991 |
|
0.91 |
% |
|
Total interest-bearing deposits |
|
3,549,383 |
|
|
3,050 |
|
0.34 |
% |
|
|
3,605,738 |
|
|
2,999 |
|
0.33 |
% |
|
|
3,358,467 |
|
|
2,072 |
|
0.24 |
% |
|
Other borrowings |
|
73,350 |
|
|
334 |
|
1.81 |
% |
|
|
17,963 |
|
|
37 |
|
0.83 |
% |
|
|
246,637 |
|
|
1,178 |
|
1.89 |
% |
|
Junior subordinated debt |
|
57,156 |
|
|
817 |
|
5.67 |
% |
|
|
57,222 |
|
|
829 |
|
5.81 |
% |
|
|
56,973 |
|
|
815 |
|
5.68 |
% |
|
Total interest-bearing liabilities |
|
3,679,889 |
|
|
4,201 |
|
0.45 |
% |
|
|
3,680,923 |
|
|
3,865 |
|
0.42 |
% |
|
|
3,662,077 |
|
|
4,065 |
|
0.44 |
% |
|
Noninterest-bearing deposits |
|
1,777,852 |
|
|
|
|
|
|
1,765,141 |
|
|
|
|
|
|
1,710,374 |
|
|
|
|
|||||||
Other liabilities |
|
104,062 |
|
|
|
|
|
|
73,541 |
|
|
|
|
|
|
86,131 |
|
|
|
|
|||||||
Shareholders’ equity |
|
890,667 |
|
|
|
|
|
|
866,284 |
|
|
|
|
|
|
797,131 |
|
|
|
|
|||||||
Total liabilities and shareholders’ equity |
$ |
6,452,470 |
|
|
|
|
|
$ |
6,385,889 |
|
|
|
|
|
$ |
6,255,713 |
|
|
|
|
|||||||
Net interest rate spread (1) (2) |
|
|
|
|
4.27 |
% |
|
|
|
|
|
4.34 |
% |
|
|
|
|
|
4.13 |
% |
|||||||
Net interest income and margin (1) (3) |
|
|
$ |
64,977 |
|
4.44 |
% |
|
|
|
$ |
64,613 |
|
4.50 |
% |
|
|
|
$ |
60,846 |
|
4.29 |
% |
||||
| (1) | Fully taxable equivalent (FTE) |
|
| (2) | Net interest spread is the average yield earned on interest-earning assets minus the average rate paid on interest-bearing liabilities. |
|
| (3) | Net interest margin is computed by calculating the difference between interest income and interest expense, divided by the average balance of interest-earning assets. All yields and rates are calculated using the specific day counts for the period and the total number of days for the year. |
|
Net interest income (FTE) during the three months ended September 30, 2019 increased $364,000 or 0.6% to $64,977,000 compared to $64,613,000 during the three months ended June 30, 2019. At the same time net interest margin declined 6 basis points to 4.44% as compared to 4.50% in the trailing quarter. The increase in net interest income (FTE) was due primarily to a shift in average balances from investments and excess liquidity maintained with the Federal Reserve yielding 2.95% and 2.29%, respectively during the third quarter to loans which yielded 5.46% during the same period. The yield on interest earning assets was 4.72% for the quarter ended September 30, 2019, which represents a decrease of 4 basis points over the trailing quarter and an increase of 15 basis points over the same quarter in the prior year.
The index utilized in a significant portion of the Company’s variable rate loans, Wall Street Journal Prime, has decreased by 50 basis points during the quarter to 5.00% at September 30, 2019, as compared to 5.25% at September 30, 2018. The index decreased by 25 basis points each month in both August and September, 2019. As such, there were minimal changes to loan yields as compared to the trailing quarter. However, as compared to the same quarter in the prior year, average loan yields increased 22 basis points from 5.24% during the three months ended September 30, 2018 to 5.46% during the three months ended September 30, 2019. Of the 22 basis point increase in yields on loans, 20 basis points was attributable to increases in market rates while 2 basis points was from increased accretion of purchased loans.
Despite the slight decreases in the average balances of interest bearing deposits which reduced interest expense, these benefits were offset by the single basis point increase in the cost of interest deposits. Further, while the average balance of interest bearing liabilities remained flat, the rate paid on other borrowings grew by 98 basis points to 1.81% for the third quarter of 2019 which was the primary driver of the cost of interest bearing liabilities growing 3 basis points to 0.45% for the third quarter of 2019 as compared to 0.83% for the second quarter of 2019. The impact of changes in rates and volumes of interest bearing liabilities resulted in an increase in interest expense of $336,000 during the current quarter. Comparing the quarter ended September 30, 2019 to the same quarter in the prior year, the cost of interest bearing deposits increased by 10 basis points to 0.34% from 0.24% as a direct result of market competition for deposits and the overall rise in the rate environment experienced subsequent to 2017.
The following table shows the components of net interest income and net interest margin on a fully tax-equivalent (FTE) basis for the year-to-date periods indicated:
ANALYSIS OF CHANGE IN NET INTEREST MARGIN ON EARNING ASSETS |
||||||||||||||||||
(unaudited, dollars in thousands) |
||||||||||||||||||
|
Nine months ended |
|
Nine months ended |
|||||||||||||||
|
September 30, 2019 |
|
September 30, 2018 |
|||||||||||||||
|
Average
|
|
Income/
|
|
Yield/
|
|
Average
|
|
Income/
|
|
Yield/
|
|||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Loans |
$ |
4,070,568 |
|
$ |
166,888 |
|
5.48 |
% |
|
$ |
3,387,390 |
|
$ |
130,455 |
|
5.15 |
% |
|
Investments–taxable |
|
1,420,426 |
|
|
31,849 |
|
3.00 |
% |
|
|
1,192,304 |
|
|
25,042 |
|
2.81 |
% |
|
Investments-nontaxable (1) |
|
138,580 |
|
|
4,024 |
|
3.88 |
% |
|
|
145,298 |
|
|
4,254 |
|
3.91 |
% |
|
Total investments |
|
1,559,006 |
|
|
35,873 |
|
3.08 |
% |
|
|
1,337,602 |
|
|
29,296 |
|
2.93 |
% |
|
Cash at Federal Reserve and other banks |
|
148,995 |
|
|
2,694 |
|
2.42 |
% |
|
|
101,889 |
|
|
1,384 |
|
1.82 |
% |
|
Total earning assets |
|
5,778,569 |
|
|
205,455 |
|
4.75 |
% |
|
|
4,826,881 |
|
|
161,135 |
|
4.46 |
% |
|
Other assets, net |
|
643,130 |
|
|
|
|
|
|
449,020 |
|
|
|
|
|||||
Total assets |
$ |
6,421,699 |
|
|
|
|
|
$ |
5,275,901 |
|
|
|
|
|||||
Liabilities and shareholders’ equity |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Interest-bearing demand deposits |
$ |
1,263,312 |
|
|
860 |
|
0.09 |
% |
|
$ |
1,038,775 |
|
|
673 |
|
0.09 |
% |
|
Savings deposits |
|
1,892,122 |
|
|
3,631 |
|
0.26 |
% |
|
|
1,524,048 |
|
|
1,671 |
|
0.15 |
% |
|
Time deposits |
|
443,546 |
|
|
4,277 |
|
1.29 |
% |
|
|
350,559 |
|
|
2,058 |
|
0.78 |
% |
|
Total interest-bearing deposits |
|
3,598,980 |
|
|
8,768 |
|
0.33 |
% |
|
|
2,913,382 |
|
|
4,402 |
|
0.20 |
% |
|
Other borrowings |
|
35,814 |
|
|
384 |
|
1.43 |
% |
|
|
165,026 |
|
|
2,106 |
|
1.70 |
% |
|
Junior subordinated debt |
|
57,109 |
|
|
2,501 |
|
5.86 |
% |
|
|
56,928 |
|
|
2,301 |
|
5.39 |
% |
|
Total interest-bearing liabilities |
|
3,691,903 |
|
|
11,653 |
|
0.42 |
% |
|
|
3,135,336 |
|
|
8,809 |
|
0.38 |
% |
|
Noninterest-bearing deposits |
|
1,761,037 |
|
|
|
|
|
|
1,462,209 |
|
|
|
|
|||||
Other liabilities |
|
101,947 |
|
|
|
|
|
|
72,772 |
|
|
|
|
|||||
Shareholders’ equity |
|
866,812 |
|
|
|
|
|
|
605,584 |
|
|
|
|
|||||
Total liabilities and shareholders’ equity |
$ |
6,421,699 |
|
|
|
|
|
$ |
5,275,901 |
|
|
|
|
|||||
Net interest rate spread (1) (2) |
|
|
|
|
4.33 |
% |
|
|
|
|
|
4.08 |
% |
|||||
Net interest income and margin (1) (3) |
|
|
$ |
193,802 |
|
4.48 |
% |
|
|
|
$ |
152,326 |
|
4.22 |
% |
|||
(1) |
|
Fully taxable equivalent (FTE) |
(2) |
|
Net interest spread is the average yield earned on interest-earning assets minus the average rate paid on interest-bearing liabilities. |
(3) |
|
Net interest margin is computed by calculating the difference between interest income and interest expense, divided by the average balance of interest-earning assets. All yields and rates are calculated using the specific day counts for the period and the total number of days for the year. |
Net interest income (FTE) during the nine months ended September 30, 2019 increased $41,476,000 or 27.2% to $193,802,000 compared to $152,326,000 during the nine months ended September 30, 2018. The increase was substantially attributable to changes in volume of earning assets from the acquisition of FNB Bancorp in July 2018 in addition to organic loan growth experienced during the second and third quarters of 2019. The yield on interest earning assets was 4.75% and 4.46% for the nine months ended September 30, 2019 and 2018, respectively. This 29 basis point increase in earning asset yield was primarily attributable to a 33 basis point increase in loan yields and a 19 basis point increase in yields on investments. Of the 33 basis point increase in yields on loans, 27 basis points was attributable to increases in market rates while 6 basis points was from increased accretion of purchased loans.
The increases in yields on earning assets were partially offset by increased funding costs as the costs of total interest bearing liabilities increased 4 basis points to 0.42% during the nine months ended September 30, 2019, as compared to 0.38% for the nine months ended September 30, 2018. During the same period, costs associated with interest bearing deposits increased by 13 basis points to 0.33% as compared to 0.20% in the prior year. The increase in interest expense for the nine months ended September 30, 2019 as compared to the prior period was due entirely to the increases in volume associated with interest-bearing deposits, offset partially with declines in volume of overnight borrowings.
Asset Quality and Loan Loss Provisioning
The Company recorded a benefit from the reversal of loan losses of $329,000 during the three months ended September 30, 2019 as compared to a provision of $537,000 for the trailing quarter, as well as provision of $2,651,000 in the same quarter of the prior year. The reversal of loan losses during the quarter ended September 30, 2019 was driven by a reduction in calculated specific reserves following the sale and charge-off of non-performing loans with carrying values totaling $4,279,000. The amount of required provision reversal was partially offset by loan growth of $78,661,000 during the third quarter. For the nine months ended September 30, 2019 the Company recorded a benefit from the reversal of loan losses of $1,392,000. While year to date loan growth in 2019 totaled $160,334,000, nonperforming loans decreased by $8,929,000, past due loans decreased by $9,279,000 and net recoveries were $347,000 during the same period. Net charge-offs (recoveries) for the quarter ended September 30, 2019 and 2018 were $1.0 million and ($0.2) million, respectively, while net charge-offs (recoveries) for the nine months ended September 30, 2019 were ($0.3) million and $0.5 million, respectively.
Provision for Income Taxes
The Company’s effective tax rate was 28.6% for the quarter ended September 30, 2019 as compared to 28.6% for the same quarter in the prior year. During the three and nine months ended September 30, 2019 as compared to the same periods in the 2018 year, the Company received non-taxable death benefits from life insurance proceeds. These benefits were offset by an increase in the estimated level of non-deductible compensation associated with increases in compensation to covered employees.
Non-interest Income
The following table presents the key components of non-interest income for the current and trailing quarterly periods indicated:
|
Three months ended |
|
|
|
|
||||||||||
(dollars in thousands) |
September 30,
|
|
June 30,
|
|
$ Change |
|
% Change |
||||||||
ATM and interchange fees |
$ |
5,427 |
|
|
$ |
5,404 |
|
|
$ |
23 |
|
|
0.4 |
% |
|
Service charges on deposit accounts |
|
4,327 |
|
|
|
4,182 |
|
|
|
145 |
|
|
3.5 |
% |
|
Other service fees |
|
808 |
|
|
|
619 |
|
|
|
189 |
|
|
30.5 |
% |
|
Mortgage banking service fees |
|
483 |
|
|
|
475 |
|
|
|
8 |
|
|
1.7 |
% |
|
Change in value of mortgage servicing rights |
|
(455 |
) |
|
|
(552 |
) |
|
|
97 |
|
|
(17.6 |
)% |
|
Total service charges and fees |
|
10,590 |
|
|
|
10,128 |
|
|
|
462 |
|
|
4.6 |
% |
|
Increase in cash value of life insurance |
|
773 |
|
|
|
746 |
|
|
|
27 |
|
|
3.6 |
% |
|
Asset management and commission income |
|
721 |
|
|
|
739 |
|
|
|
(18 |
) |
|
(2.4 |
)% |
|
Gain on sale of loans |
|
1,236 |
|
|
|
575 |
|
|
|
661 |
|
|
115.0 |
% |
|
Lease brokerage income |
|
172 |
|
|
|
239 |
|
|
|
(67 |
) |
|
(28.0 |
)% |
|
Sale of customer checks |
|
126 |
|
|
|
135 |
|
|
|
(9 |
) |
|
(6.7 |
)% |
|
Gain on sale of investment securities |
|
107 |
|
|
— |
|
|
107 |
|
|
—% |
||||
Gain on marketable equity securities |
|
22 |
|
|
|
42 |
|
|
|
(20 |
) |
|
(47.6 |
)% |
|
Other |
|
361 |
|
|
|
819 |
|
|
|
(458 |
) |
|
(55.9 |
)% |
|
Total other non-interest income |
|
3,518 |
|
|
|
3,295 |
|
|
|
223 |
|
|
6.8 |
% |
|
Total non-interest income |
$ |
14,108 |
|
|
$ |
13,423 |
|
|
$ |
685 |
|
|
5.1 |
% |
|
Non-interest income increased $685,000 or 5.1% to $14,108,000 during the three months ended September 30, 2019 compared to the trailing quarter June 30, 2019. The increase in non-interest income was due primarily to increases in fees charged for various services and increases in usage associated with both services and interchange transactions. As a result, service charges on deposit accounts increased over the linked quarter by $145,000 or 3.5% and other service fees increased by $189,000 or 30.5%. Rates associated with mortgage loans, which declined significantly late in the second quarter of 2019, remained at near historic lows during the third quarter and resulted in a $661,000 increase in gains from the sale of loans due to an increase in the volume of mortgage loans sold. Similar to the second quarter of 2019, the value of mortgage servicing rights continued to decline which is consistent with the declining rate environment and changes in the assumptions utilized in determining their fair value. Specifically, further increases in prepayment speeds resulting from decreases in the 15 and 30 year mortgage rates continued to be the largest contributors to the decline in fair value of the mortgage servicing asset. These positive changes in non-interest income were offset by a reduction in other non-interest income which included $104,000 and $696,000 in death benefit insurance proceeds during the third and second quarters of 2019, respectively. During the three months ended September 30, 2019, net gains of $107,000 were realized from the sale of investment securities and there were no security sales in the trailing quarter.
The following table presents the key components of non-interest income for the current and prior year quarterly periods indicated:
|
Three months ended September 30, |
||||||||||||||
(dollars in thousands) |
|
2019 |
|
|
|
2018 |
|
|
$ Change |
|
% Change |
||||
ATM and interchange fees |
$ |
5,427 |
|
|
$ |
4,590 |
|
|
$ |
837 |
|
|
18.2 |
% |
|
Service charges on deposit accounts |
|
4,327 |
|
|
|
4,015 |
|
|
|
312 |
|
|
7.8 |
% |
|
Other service fees |
|
808 |
|
|
|
676 |
|
|
|
132 |
|
|
19.5 |
% |
|
Mortgage banking service fees |
|
483 |
|
|
|
499 |
|
|
|
(16 |
) |
|
(3.2 |
)% |
|
Change in value of mortgage servicing rights |
|
(455 |
) |
|
|
(37 |
) |
|
|
(418 |
) |
|
1,129.7 |
% |
|
Total service charges and fees |
|
10,590 |
|
|
|
9,743 |
|
|
|
847 |
|
|
8.7 |
% |
|
Increase in cash value of life insurance |
|
773 |
|
|
|
732 |
|
|
|
41 |
|
|
5.6 |
% |
|
Asset management and commission income |
|
721 |
|
|
|
728 |
|
|
|
(7 |
) |
|
(1.0 |
)% |
|
Gain on sale of loans |
|
1,236 |
|
|
|
539 |
|
|
|
697 |
|
|
129.3 |
% |
|
Lease brokerage income |
|
172 |
|
|
|
186 |
|
|
|
(14 |
) |
|
(7.5 |
)% |
|
Sale of customer checks |
|
126 |
|
|
|
88 |
|
|
|
38 |
|
|
43.2 |
% |
|
Gain on sale of investment securities |
|
107 |
|
|
|
207 |
|
|
|
(100 |
) |
|
(48.3 |
)% |
|
Gain (loss) on marketable equity securities |
|
22 |
|
|
|
(22 |
) |
|
|
44 |
|
|
(200.0 |
)% |
|
Other |
|
361 |
|
|
|
135 |
|
|
|
226 |
|
|
167.4 |
% |
|
Total other non-interest income |
|
3,518 |
|
|
|
2,593 |
|
|
|
925 |
|
|
35.7 |
% |
|
Total non-interest income |
$ |
14,108 |
|
|
$ |
12,336 |
|
|
$ |
1,772 |
|
|
14.4 |
% |
|
Non-interest income increased $1,772,000 (14.4%) to $14,108,000 during the three months ended September 30, 2019 compared to the same period in 2018. As noted previously, the increase in non-interest income was largely driven by increases in fees charged for various services and increases in usage associated with both services and interchange transactions. As a result, ATM and interchange fees increased by $837,000 (18.2%) during the three months ended September 30, 2019 compared to 2018, and service charges on deposit accounts increased by $312,000 (7.8%) over the same period. Other significant increases in non-interest income for the three months ended September 30, 2019 include the aforementioned increase in gain on sale of loans totaling $697,000 and death benefit insurance proceeds of $104,000 realized during the third quarters of 2019. There were no death benefit insurance proceeds received during 2018.
The following table presents the key components of non-interest income for the current and prior year-to-date periods indicated:
|
Nine months ended September 30, |
||||||||||||||
(dollars in thousands) |
|
2019 |
|
|
|
2018 |
|
|
$ Change |
|
% Change |
||||
ATM and interchange fees |
$ |
15,412 |
|
|
$ |
13,335 |
|
|
$ |
2,077 |
|
|
15.6 |
% |
|
Service charges on deposit accounts |
|
12,389 |
|
|
|
11,407 |
|
|
|
982 |
|
|
8.6 |
% |
|
Other service fees |
|
2,198 |
|
|
|
2,020 |
|
|
|
178 |
|
|
8.8 |
% |
|
Mortgage banking service fees |
|
1,441 |
|
|
|
1,527 |
|
|
|
(86 |
) |
|
(5.6 |
)% |
|
Change in value of mortgage servicing rights |
|
(1,652 |
) |
|
|
38 |
|
|
|
(1,690 |
) |
|
(4,447.4 |
)% |
|
Total service charges and fees |
|
29,788 |
|
|
|
28,327 |
|
|
|
1,461 |
|
|
5.2 |
% |
|
Increase in cash value of life insurance |
|
2,294 |
|
|
|
1,996 |
|
|
|
298 |
|
|
14.9 |
% |
|
Asset management and commission income |
|
2,102 |
|
|
|
2,414 |
|
|
|
(312 |
) |
|
(12.9 |
)% |
|
Gain on sale of loans |
|
2,223 |
|
|
|
1,831 |
|
|
|
392 |
|
|
21.4 |
% |
|
Lease brokerage income |
|
631 |
|
|
|
514 |
|
|
|
117 |
|
|
22.8 |
% |
|
Sale of customer checks |
|
401 |
|
|
|
327 |
|
|
|
74 |
|
|
22.6 |
% |
|
Gain on sale of investment securities |
|
107 |
|
|
|
207 |
|
|
|
(100 |
) |
|
(48.3 |
)% |
|
Gain (loss) on marketable equity securities |
|
100 |
|
|
|
(92 |
) |
|
|
192 |
|
|
(208.7 |
)% |
|
Other |
|
1,688 |
|
|
|
942 |
|
|
|
746 |
|
|
79.2 |
% |
|
Total other non-interest income |
|
9,546 |
|
|
|
8,139 |
|
|
|
1,407 |
|
|
17.3 |
% |
|
Total non-interest income |
$ |
39,334 |
|
|
$ |
36,466 |
|
|
$ |
2,868 |
|
|
7.9 |
% |
|
Non-interest income increased $2,868,000 (7.9%) to $39,334,000 during the nine months ended September 30, 2019 compared to the comparable nine month period in 2018. Non-interest income for the nine months ended 2019 as compared to the same period in 2018 was impacted by changes in the fair value of the Company’s mortgage servicing assets, which contributed to a $1,690,000 decline, coupled with the previously discussed increase in income charged for interchange fees and service charges, which increased by $2,077,000 (15.6%) and $982,000 (8.6%), respectively. Other non-interest income was positively impacted by the receipt of $831,000 in death benefit insurance proceeds during the nine months ended September 30, 2019 compared to none in the same 2018 period.
Non-interest Expense
The following table presents the key components of non-interest expense for the current and trailing quarterly periods indicated:
|
Three months ended |
|
|
|
|
||||||||||
(dollars in thousands) |
September 30,
|
|
June 30,
|
|
$ Change |
|
% Change |
||||||||
Base salaries, net of deferred loan origination costs |
$ |
17,656 |
|
|
$ |
17,211 |
|
|
$ |
445 |
|
|
2.6 |
% |
|
Incentive compensation |
|
3,791 |
|
|
|
3,706 |
|
|
|
85 |
|
|
2.3 |
% |
|
Benefits and other compensation costs |
|
5,452 |
|
|
|
5,802 |
|
|
|
(350 |
) |
|
(6.0 |
)% |
|
Total salaries and benefits expense |
|
26,899 |
|
|
|
26,719 |
|
|
|
180 |
|
|
0.7 |
% |
|
Occupancy |
|
3,711 |
|
|
|
3,738 |
|
|
|
(27 |
) |
|
(0.7 |
)% |
|
Data processing and software |
|
3,411 |
|
|
|
3,354 |
|
|
|
57 |
|
|
1.7 |
% |
|
Equipment |
|
1,679 |
|
|
|
1,752 |
|
|
|
(73 |
) |
|
(4.2 |
)% |
|
Intangible amortization |
|
1,431 |
|
|
|
1,431 |
|
|
— |
|
— |
% | |||
Advertising |
|
1,358 |
|
|
|
1,533 |
|
|
|
(175 |
) |
|
(11.4 |
)% |
|
ATM and POS network charges |
|
1,343 |
|
|
|
1,270 |
|
|
|
73 |
|
|
5.7 |
% |
|
Professional fees |
|
999 |
|
|
|
1,057 |
|
|
|
(58 |
) |
|
(5.5 |
)% |
|
Telecommunications |
|
867 |
|
|
|
773 |
|
|
|
94 |
|
|
12.2 |
% |
|
Regulatory assessments and insurance |
|
94 |
|
|
|
490 |
|
|
|
(396 |
) |
|
(80.8 |
)% |
|
Postage |
|
438 |
|
|
|
315 |
|
|
|
123 |
|
|
39.0 |
% |
|
Operational losses |
|
228 |
|
|
|
226 |
|
|
|
2 |
|
|
0.9 |
% |
|
Courier service |
|
357 |
|
|
|
412 |
|
|
|
(55 |
) |
|
(13.3 |
)% |
|
Gain on sale of foreclosed assets |
|
(50 |
) |
|
|
(197 |
) |
|
|
147 |
|
|
(74.6 |
)% |
|
Loss on disposal of fixed assets |
|
2 |
|
|
|
42 |
|
|
|
(40 |
) |
|
(95.2 |
)% |
|
Other miscellaneous expense |
|
3,577 |
|
|
|
3,782 |
|
|
|
(205 |
) |
|
(5.4 |
)% |
|
Total other non-interest expense |
|
19,445 |
|
|
|
19,978 |
|
|
|
(533 |
) |
|
(2.7 |
)% |
|
Total non-interest expense |
$ |
46,344 |
|
|
$ |
46,697 |
|
|
$ |
(353 |
) |
|
(0.8 |
)% |
|
Average full-time equivalent staff |
|
1,160 |
|
|
|
1,138 |
|
|
|
22 |
|
|
1.9 |
% |
|
Non-interest expense for the quarter ended September 30, 2019 decreased $353,000 (0.8%) to $46,344,000 as compared to $46,697,000 during the trailing quarter ended June 30, 2019. Increases in salaries were primarily attributable to the increase in average full-time equivalent staff and to a lesser extent, compensation adjustments associated with changes in the Company's management structure. The nominal increase in incentive compensation cost, which contributed to an $85,000 increase in non-interest expense as compared to the trailing quarter, relates directly to loan originations and net loan growth. By comparison, incentive compensation expense of $2,567,000 was incurred during the first quarter of 2019, a period when loan growth approximated $12,317,000. The decrease in regulatory assessment expense totaled $396,000 during the third quarter of 2019, following a credit from the Deposit Insurance Fund totaling $435,000. While other miscellaneous expenses declined by $205,000 in the third quarter of 2019 as compared to the trailing quarter, there were no singularly significant items of change that were identified.
The following table presents the key components of non-interest expense for the current and prior year quarterly periods indicated:
|
Three months ended
|
|
|
|
|
||||||||||
(dollars in thousands) |
|
2019 |
|
|
|
2018 |
|
|
$ Change |
|
% Change |
||||
Base salaries, net of deferred loan origination costs |
$ |
17,656 |
|
|
$ |
15,685 |
|
|
$ |
1,971 |
|
|
12.6 |
% |
|
Incentive compensation |
|
3,791 |
|
|
|
4,515 |
|
|
|
(724 |
) |
|
(16.0 |
)% |
|
Benefits and other compensation costs |
|
5,452 |
|
|
|
5,623 |
|
|
|
(171 |
) |
|
(3.0 |
)% |
|
Total salaries and benefits expense |
|
26,899 |
|
|
|
25,823 |
|
|
|
1,076 |
|
|
4.2 |
% |
|
Occupancy |
|
3,711 |
|
|
|
3,173 |
|
|
|
538 |
|
|
17.0 |
% |
|
Data processing and software |
|
3,411 |
|
|
|
2,786 |
|
|
|
625 |
|
|
22.4 |
% |
|
Equipment |
|
1,679 |
|
|
|
1,750 |
|
|
|
(71 |
) |
|
(4.1 |
)% |
|
Intangible amortization |
|
1,431 |
|
|
|
1,390 |
|
|
|
41 |
|
|
2.9 |
% |
|
Advertising |
|
1,358 |
|
|
|
1,341 |
|
|
|
17 |
|
|
1.3 |
% |
|
ATM and POS network charges |
|
1,343 |
|
|
|
1,197 |
|
|
|
146 |
|
|
12.2 |
% |
|
Professional fees |
|
999 |
|
|
|
1,352 |
|
|
|
(353 |
) |
|
(26.1 |
)% |
|
Telecommunications |
|
867 |
|
|
|
819 |
|
|
|
48 |
|
|
5.9 |
% |
|
Regulatory assessments and insurance |
|
94 |
|
|
|
537 |
|
|
|
(443 |
) |
|
(82.5 |
)% |
|
Merger and acquisition expense |
— |
|
|
4,150 |
|
|
|
(4,150 |
) |
|
(100.0 |
)% |
|||
Postage |
|
438 |
|
|
|
275 |
|
|
|
163 |
|
|
59.3 |
% |
|
Operational losses |
|
228 |
|
|
|
217 |
|
|
|
11 |
|
|
5.1 |
% |
|
Courier service |
|
357 |
|
|
|
278 |
|
|
|
79 |
|
|
28.4 |
% |
|
Gain on sale of foreclosed assets |
|
(50 |
) |
|
|
(2 |
) |
|
|
(48 |
) |
|
2,400.0 |
% |
|
Loss on disposal of fixed assets |
|
2 |
|
|
|
152 |
|
|
|
(150 |
) |
|
(98.7 |
)% |
|
Other miscellaneous expense |
|
3,577 |
|
|
|
2,290 |
|
|
|
1,287 |
|
|
56.2 |
% |
|
Total other non-interest expense |
|
19,445 |
|
|
|
21,705 |
|
|
|
(2,260 |
) |
|
(10.4 |
)% |
|
Total non-interest expense |
$ |
46,344 |
|
|
$ |
47,528 |
|
|
$ |
(1,184 |
) |
|
(2.5 |
)% |
|
Average full-time equivalent staff |
|
1,160 |
|
|
|
1,146 |
|
|
|
14 |
|
|
1.2 |
% |
|
Non-interest expense decreased by $1,184,000 (2.5)% to $46,344,000 during the three months ended September 30, 2019 as compared to $47,528,000 for the three months ended September 30, 2018. The acquisition of FNB Bancorp was completed in July 2018, thereby eliminating merger related expenses of $4,150,000 for the three months ended September 30, 2019 as compared to the same period in 2018.
Salary and benefit expenses increased $1,076,000 or 4.2% to $26,899,000 during the three months ended September 30, 2019 compared to $25,823,000 during the three months ended June 30, 2018. Base salaries, net of deferred loan origination costs increased by $1,971,000 or 12.6% to $17,656,000. These increases were the result of annual merit increases as well as compensation adjustments associated with changes in the organizational structure of management. Commissions and incentive compensation decreased $724,000 or (16.0)% to $3,791,000 during the three months ended September 30, 2019 compared to the year-ago quarter due primarily to accruals associated with the retention of personnel through the integration of the FNB Bancorp acquisition. Benefits and other compensation expense decreased $171,000 or (3.0)% to $5,452,000 during the three months ended September 30, 2019 due to improvements in loss rates associated with employer provided health insurance.
The following table presents the key components of non-interest expense for the current and prior year to date periods indicated:
|
Nine months ended
|
|
|
|
|
||||||||||
(dollars in thousands) |
|
2019 |
|
|
|
2018 |
|
|
$ Change |
|
% Change |
||||
Base salaries, net of deferred loan origination costs |
$ |
51,624 |
|
|
$ |
44,076 |
|
|
$ |
7,548 |
|
|
17.1 |
% |
|
Incentive compensation |
|
10,064 |
|
|
|
9,126 |
|
|
|
938 |
|
|
10.3 |
% |
|
Benefits and other compensation costs |
|
17,058 |
|
|
|
15,726 |
|
|
|
1,332 |
|
|
8.5 |
% |
|
Total salaries and benefits expense |
|
78,746 |
|
|
|
68,928 |
|
|
|
9,818 |
|
|
14.2 |
% |
|
Occupancy |
|
11,223 |
|
|
|
8,574 |
|
|
|
2,649 |
|
|
30.9 |
% |
|
Data processing and software |
|
10,114 |
|
|
|
7,979 |
|
|
|
2,135 |
|
|
26.8 |
% |
|
Equipment |
|
5,298 |
|
|
|
4,938 |
|
|
|
360 |
|
|
7.3 |
% |
|
Intangible amortization |
|
4,293 |
|
|
|
2,068 |
|
|
|
2,225 |
|
|
107.6 |
% |
|
Advertising |
|
4,222 |
|
|
|
3,214 |
|
|
|
1,008 |
|
|
31.4 |
% |
|
ATM and POS network charges |
|
3,936 |
|
|
|
3,860 |
|
|
|
76 |
|
|
2.0 |
% |
|
Professional fees |
|
2,895 |
|
|
|
2,898 |
|
|
|
(3 |
) |
|
(0.1 |
)% |
|
Telecommunications |
|
2,437 |
|
|
|
2,201 |
|
|
|
236 |
|
|
10.7 |
% |
|
Regulatory assessments and insurance |
|
1,095 |
|
|
|
1,384 |
|
|
|
(289 |
) |
|
(20.9 |
)% |
|
Merger and acquisition expense |
— |
|
|
5,227 |
|
|
|
(5,227 |
) |
|
(100.0 |
)% |
|||
Postage |
|
1,063 |
|
|
|
934 |
|
|
|
129 |
|
|
13.8 |
% |
|
Operational losses |
|
679 |
|
|
|
763 |
|
|
|
(84 |
) |
|
(11.0 |
)% |
|
Courier service |
|
1,039 |
|
|
|
769 |
|
|
|
270 |
|
|
35.1 |
% |
|
Gain on sale of foreclosed assets |
|
(246 |
) |
|
|
(390 |
) |
|
|
144 |
|
|
(36.9 |
)% |
|
Loss on disposal of fixed assets |
|
82 |
|
|
|
206 |
|
|
|
(124 |
) |
|
(60.2 |
)% |
|
Other miscellaneous expense |
|
11,617 |
|
|
|
9,673 |
|
|
|
1,944 |
|
|
20.1 |
% |
|
Total other non-interest expense |
|
59,747 |
|
|
|
54,298 |
|
|
|
5,449 |
|
|
10.0 |
% |
|
Total non-interest expense |
$ |
138,493 |
|
|
$ |
123,226 |
|
|
$ |
15,267 |
|
|
12.4 |
% |
|
Average full-time equivalent staff |
|
1,145 |
|
|
|
1,050 |
|
|
|
95 |
|
|
9.0 |
% |
|
Non-interest expense increased by $15,267,000 (12.4%) to $138,493,000 during the nine months ended September 30, 2019 as compared to the $123,226,000 for the nine months ended September 30, 2018. Virtually all significant increases in non-interest expense can be attributed to the acquisition of FNB Bancorp that took place in July 2018, which is reflected in all periods during the nine months ended September 30, 2019.
About TriCo Bancshares
Established in 1975, Tri Counties Bank is a wholly-owned subsidiary of TriCo Bancshares (NASDAQ: TCBK) headquartered in Chico, California, providing a unique brand of customer Service with Solutions available in traditional stand-alone and in-store bank branches in communities throughout Northern and Central California. Tri Counties Bank provides an extensive and competitive breadth of consumer, small business and commercial banking financial services, along with convenient around-the-clock ATM, online and mobile banking access. Brokerage services are provided by the Bank’s investment services through affiliation with Raymond James Financial Services, Inc. Visit www.TriCountiesBank.com to learn more.
Forward-Looking Statement
The statements contained herein that are not historical facts are forward-looking statements based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond our control. There can be no assurance that future developments affecting us will be the same as those anticipated by management. We caution readers that a number of important factors could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements. These risks and uncertainties include, but are not limited to, the following: the strength of the United States economy in general and the strength of the local economies in which we conduct operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; inflation, interest rate, market and monetary fluctuations; the impact of changes in financial services policies, laws and regulations; technological changes; mergers and acquisitions; changes in the level of our nonperforming assets and charge-offs; any deterioration in values of California real estate, both residential and commercial; the effect of changes in accounting standards and practices; possible other-than-temporary impairment of securities held by us; changes in consumer spending, borrowing and savings habits; our ability to attract deposits and other sources of liquidity; changes in the financial performance and/or condition of our borrowers; the impact of competition from other financial service providers; the possibility that any of the anticipated benefits of our recent merger with FNBB will not be realized or will not be realized within the expected time period, or that integration of FNBB’s operations will be more costly or difficult than expected; the challenges of integrating and retaining key employees; unanticipated regulatory or judicial proceedings; the costs and effects of litigation and of unexpected or adverse outcomes in such litigation; and our ability to manage the risks involved in the foregoing. Additional factors that could cause results to differ materially from those described above can be found in our Annual Report on Form 10-K for the year ended December 31, 2018, which is on file with the Securities and Exchange Commission (the “SEC”) and available in the “Investor Relations” section of our website, https://www.tcbk.com/investor-relations and in other documents we file with the SEC. Annualized, pro forma, projections and estimates are not forecasts and may not reflect actual results.
TRICO BANCSHARES—CONDENSED CONSOLIDATED FINANCIAL DATA |
||||||||||||||||||||
(Unaudited. Dollars in thousands, except share data) |
||||||||||||||||||||
|
Three months ended |
|||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|||||||||||
Revenue and Expense Data |
|
|
|
|
|
|
|
|
|
|||||||||||
Interest income |
$ |
68,889 |
|
|
$ |
68,180 |
|
|
$ |
67,457 |
|
|
$ |
68,065 |
|
|
$ |
64,554 |
|
|
Interest expense |
|
4,201 |
|
|
|
3,865 |
|
|
|
3,587 |
|
|
|
4,063 |
|
|
|
4,065 |
|
|
Net interest income |
|
64,688 |
|
|
|
64,315 |
|
|
|
63,870 |
|
|
|
64,002 |
|
|
|
60,489 |
|
|
Provision for (benefit from) loan losses |
|
(329 |
) |
|
|
537 |
|
|
|
(1,600 |
) |
|
|
806 |
|
|
|
2,651 |
|
|
Noninterest income: |
|
|
|
|
|
|
|
|
|
|||||||||||
Service charges and fees |
|
10,590 |
|
|
|
10,128 |
|
|
|
9,070 |
|
|
|
10,132 |
|
|
|
9,743 |
|
|
Gain on sale of investment securities |
|
107 |
|
|
— |
|
— |
|
— |
|
|
207 |
|
|||||||
Other income |
|
3,411 |
|
|
|
3,295 |
|
|
|
2,733 |
|
|
|
2,541 |
|
|
|
2,386 |
|
|
Total noninterest income |
|
14,108 |
|
|
|
13,423 |
|
|
|
11,803 |
|
|
|
12,673 |
|
|
|
12,336 |
|
|
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|||||||||||
Salaries and benefits |
|
26,899 |
|
|
|
26,719 |
|
|
|
25,128 |
|
|
|
25,014 |
|
|
|
25,823 |
|
|
Occupancy and equipment |
|
5,390 |
|
|
|
5,490 |
|
|
|
5,641 |
|
|
|
5,278 |
|
|
|
5,056 |
|
|
Data processing and network |
|
4,754 |
|
|
|
4,624 |
|
|
|
4,672 |
|
|
|
4,455 |
|
|
|
3,981 |
|
|
Other noninterest expense |
|
9,301 |
|
|
|
9,864 |
|
|
|
10,011 |
|
|
|
10,577 |
|
|
|
12,668 |
|
|
Total noninterest expense |
|
46,344 |
|
|
|
46,697 |
|
|
|
45,452 |
|
|
|
45,324 |
|
|
|
47,528 |
|
|
Total income before taxes |
|
32,781 |
|
|
|
30,504 |
|
|
|
31,821 |
|
|
|
30,545 |
|
|
|
22,646 |
|
|
Provision for income taxes |
|
9,386 |
|
|
|
7,443 |
|
|
|
9,095 |
|
|
|
7,334 |
|
|
|
6,476 |
|
|
Net income |
$ |
23,395 |
|
|
$ |
23,061 |
|
|
$ |
22,726 |
|
|
$ |
23,211 |
|
|
$ |
16,170 |
|
|
Share Data |
|
|
|
|
|
|
|
|
|
|||||||||||
Basic earnings per share |
$ |
0.77 |
|
|
$ |
0.76 |
|
|
$ |
0.75 |
|
|
$ |
0.76 |
|
|
$ |
0.54 |
|
|
Diluted earnings per share |
$ |
0.76 |
|
|
$ |
0.75 |
|
|
$ |
0.74 |
|
|
$ |
0.76 |
|
|
$ |
0.53 |
|
|
Dividends per share |
$ |
0.22 |
|
|
$ |
0.19 |
|
|
$ |
0.19 |
|
|
$ |
0.19 |
|
|
$ |
0.17 |
|
|
Book value per common share |
$ |
29.39 |
|
|
$ |
28.71 |
|
|
$ |
28.04 |
|
|
$ |
27.20 |
|
|
$ |
26.37 |
|
|
Tangible book value per common share (1) |
$ |
21.33 |
|
|
$ |
20.60 |
|
|
$ |
19.86 |
|
|
$ |
18.97 |
|
|
$ |
18.10 |
|
|
Shares outstanding |
|
30,512,187 |
|
|
|
30,502,757 |
|
|
|
30,432,419 |
|
|
|
30,417,223 |
|
|
|
30,417,818 |
|
|
Weighted average shares |
|
30,509,057 |
|
|
|
30,458,427 |
|
|
|
30,424,184 |
|
|
|
30,422,687 |
|
|
|
30,011,307 |
|
|
Weighted average diluted shares |
|
30,629,027 |
|
|
|
30,642,518 |
|
|
|
30,657,833 |
|
|
|
30,671,723 |
|
|
|
30,291,225 |
|
|
Credit Quality |
|
|
|
|
|
|
|
|
|
|||||||||||
Loans past due 30 days or more |
$ |
8,089 |
|
|
$ |
14,580 |
|
|
$ |
16,761 |
|
|
$ |
17,368 |
|
|
$ |
13,218 |
|
|
Nonperforming originated loans |
$ |
11,260 |
|
|
$ |
14,087 |
|
|
$ |
13,737 |
|
|
$ |
19,416 |
|
|
$ |
17,087 |
|
|
Total nonperforming loans |
$ |
18,565 |
|
|
$ |
20,585 |
|
|
$ |
19,565 |
|
|
$ |
27,494 |
|
|
$ |
27,148 |
|
|
Total nonperforming assets |
$ |
20,111 |
|
|
$ |
22,133 |
|
|
$ |
21,880 |
|
|
$ |
29,774 |
|
|
$ |
28,980 |
|
|
Loans charged-off |
$ |
1,522 |
|
|
$ |
293 |
|
|
$ |
726 |
|
|
$ |
424 |
|
|
$ |
1,142 |
|
|
Loans recovered |
$ |
520 |
|
|
$ |
560 |
|
|
$ |
1,808 |
|
|
$ |
596 |
|
|
$ |
570 |
|
|
Selected Financial Ratios |
|
|
|
|
|
|
|
|
|
|||||||||||
Return on average total assets |
|
1.44 |
% |
|
|
1.45 |
% |
|
|
1.43 |
% |
|
|
1.46 |
% |
|
|
1.05 |
% |
|
Return on average equity |
|
10.42 |
% |
|
|
10.68 |
% |
|
|
10.93 |
% |
|
|
11.33 |
% |
|
|
9.11 |
% |
|
Average yield on loans |
|
5.46 |
% |
|
|
5.50 |
% |
|
|
5.48 |
% |
|
|
5.48 |
% |
|
|
5.24 |
% |
|
Average yield on interest-earning assets |
|
4.72 |
% |
|
|
4.76 |
% |
|
|
4.77 |
% |
|
|
4.78 |
% |
|
|
4.57 |
% |
|
Average rate on interest-bearing deposits |
|
0.34 |
% |
|
|
0.33 |
% |
|
|
0.30 |
% |
|
|
0.29 |
% |
|
|
0.24 |
% |
|
Average cost of total deposits |
|
0.23 |
% |
|
|
0.22 |
% |
|
|
0.20 |
% |
|
|
0.20 |
% |
|
|
0.16 |
% |
|
Average rate on borrowings and subordinated debt |
|
3.50 |
% |
|
|
4.62 |
% |
|
|
4.75 |
% |
|
|
3.24 |
% |
|
|
2.60 |
% |
|
Average rate on interest-bearing liabilities |
|
0.45 |
% |
|
|
0.42 |
% |
|
|
0.39 |
% |
|
|
0.44 |
% |
|
|
0.44 |
% |
|
Net interest margin (fully tax-equivalent) |
|
4.44 |
% |
|
|
4.50 |
% |
|
|
4.52 |
% |
|
|
4.49 |
% |
|
|
4.29 |
% |
|
Loans to deposits |
|
78.98 |
% |
|
|
76.82 |
% |
|
|
74.29 |
% |
|
|
74.95 |
% |
|
|
79.08 |
% |
|
Efficiency ratio |
|
58.82 |
% |
|
|
60.07 |
% |
|
|
60.06 |
% |
|
|
59.11 |
% |
|
|
65.26 |
% |
|
Supplemental Loan Interest Income Data |
|
|
|
|
|
|
|
|
|
|||||||||||
Discount accretion on acquired loans |
$ |
2,360 |
|
|
$ |
1,904 |
|
|
$ |
1,655 |
|
|
$ |
1,982 |
|
|
$ |
2,098 |
|
|
All other loan interest income |
$ |
54,639 |
|
|
$ |
53,587 |
|
|
$ |
52,743 |
|
|
$ |
53,680 |
|
|
$ |
51,004 |
|
|
Total loan interest income |
$ |
56,999 |
|
|
$ |
55,491 |
|
|
$ |
54,398 |
|
|
$ |
55,662 |
|
|
$ |
53,102 |
|
|
(1) |
Tangible book value per share is calculated by subtracting goodwill and other intangible assets from total shareholders’ equity and dividing that result by the shares outstanding at the end of the period. Management believes that tangible book value per common share is meaningful because it is a measure that the Company and investors commonly use to assess shareholder value. |
|
TRICO BANCSHARES—CONDENSED CONSOLIDATED FINANCIAL DATA |
||||||||||||||||||||
(Unaudited. Dollars in thousands) |
||||||||||||||||||||
|
|
|||||||||||||||||||
Balance Sheet Data |
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|||||||||||
Cash and due from banks |
$ |
259,047 |
|
|
$ |
175,582 |
|
|
$ |
318,708 |
|
|
$ |
227,533 |
|
|
$ |
226,543 |
|
|
Securities, available for sale |
|
987,054 |
|
|
|
1,136,946 |
|
|
|
1,116,426 |
|
|
|
1,117,910 |
|
|
|
1,058,806 |
|
|
Securities, held to maturity |
|
393,449 |
|
|
|
412,524 |
|
|
|
431,016 |
|
|
|
444,936 |
|
|
|
459,897 |
|
|
Restricted equity securities |
|
17,250 |
|
|
|
17,250 |
|
|
|
17,250 |
|
|
|
17,250 |
|
|
|
17,250 |
|
|
Loans held for sale |
|
7,604 |
|
|
|
5,875 |
|
|
|
5,410 |
|
|
|
3,687 |
|
|
|
3,824 |
|
|
Loans: |
|
|
|
|
|
|
|
|
|
|||||||||||
Commercial loans |
|
278,458 |
|
|
|
276,045 |
|
|
|
269,163 |
|
|
|
276,548 |
|
|
|
289,645 |
|
|
Consumer loans |
|
442,539 |
|
|
|
434,388 |
|
|
|
418,352 |
|
|
|
418,982 |
|
|
|
421,287 |
|
|
Real estate mortgage loans |
|
3,247,156 |
|
|
|
3,178,730 |
|
|
|
3,129,339 |
|
|
|
3,143,100 |
|
|
|
3,132,202 |
|
|
Real estate construction loans |
|
214,195 |
|
|
|
214,524 |
|
|
|
217,477 |
|
|
|
183,384 |
|
|
|
184,302 |
|
|
Total loans, gross |
|
4,182,348 |
|
|
|
4,103,687 |
|
|
|
4,034,331 |
|
|
|
4,022,014 |
|
|
|
4,027,436 |
|
|
Allowance for loan losses |
|
(31,537 |
) |
|
|
(32,868 |
) |
|
|
(32,064 |
) |
|
|
(32,582 |
) |
|
|
(31,603 |
) |
|
Total loans, net |
|
4,150,811 |
|
|
|
4,070,819 |
|
|
|
4,002,267 |
|
|
|
3,989,432 |
|
|
|
3,995,833 |
|
|
Premises and equipment |
|
87,424 |
|
|
|
88,534 |
|
|
|
89,275 |
|
|
|
89,347 |
|
|
|
89,290 |
|
|
Cash value of life insurance |
|
117,088 |
|
|
|
116,606 |
|
|
|
117,841 |
|
|
|
117,318 |
|
|
|
116,596 |
|
|
Accrued interest receivable |
|
18,205 |
|
|
|
20,990 |
|
|
|
20,431 |
|
|
|
19,412 |
|
|
|
19,592 |
|
|
Goodwill |
|
220,872 |
|
|
|
220,972 |
|
|
|
220,972 |
|
|
|
220,972 |
|
|
|
220,972 |
|
|
Other intangible assets |
|
24,988 |
|
|
|
26,418 |
|
|
|
27,849 |
|
|
|
29,280 |
|
|
|
30,711 |
|
|
Operating leases, right-of-use |
|
28,957 |
|
|
|
30,030 |
|
|
|
30,942 |
|
|
— |
|
— |
|||||
Other assets |
|
72,134 |
|
|
|
72,626 |
|
|
|
73,465 |
|
|
|
75,364 |
|
|
|
79,551 |
|
|
Total assets |
$ |
6,384,883 |
|
|
$ |
6,395,172 |
|
|
$ |
6,471,852 |
|
|
$ |
6,352,441 |
|
|
$ |
6,318,865 |
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
|||||||||||
Noninterest-bearing demand deposits |
$ |
1,777,357 |
|
|
$ |
1,780,339 |
|
|
$ |
1,761,559 |
|
|
$ |
1,760,580 |
|
|
$ |
1,710,505 |
|
|
Interest-bearing demand deposits |
|
1,222,955 |
|
|
|
1,263,635 |
|
|
|
1,297,672 |
|
|
|
1,252,366 |
|
|
|
1,152,705 |
|
|
Savings deposits |
|
1,843,873 |
|
|
|
1,856,749 |
|
|
|
1,925,168 |
|
|
|
1,921,324 |
|
|
|
1,801,087 |
|
|
Time certificates |
|
451,222 |
|
|
|
441,450 |
|
|
|
445,863 |
|
|
|
432,196 |
|
|
|
428,820 |
|
|
Total deposits |
|
5,295,407 |
|
|
|
5,342,173 |
|
|
|
5,430,262 |
|
|
|
5,366,466 |
|
|
|
5,093,117 |
|
|
Accrued interest payable |
|
2,847 |
|
|
|
2,665 |
|
|
|
2,195 |
|
|
|
1,997 |
|
|
|
1,729 |
|
|
Operating lease liability |
|
28,494 |
|
|
|
29,434 |
|
|
|
30,204 |
|
|
— |
|
— |
|||||
Other liabilities |
|
87,867 |
|
|
|
74,590 |
|
|
|
86,362 |
|
|
|
83,724 |
|
|
|
82,077 |
|
|
Other borrowings |
|
16,423 |
|
|
|
13,292 |
|
|
|
12,466 |
|
|
|
15,839 |
|
|
|
282,831 |
|
|
Junior subordinated debt |
|
57,180 |
|
|
|
57,132 |
|
|
|
57,085 |
|
|
|
57,042 |
|
|
|
56,996 |
|
|
Total liabilities |
|
5,488,218 |
|
|
|
5,519,286 |
|
|
|
5,618,574 |
|
|
|
5,525,068 |
|
|
|
5,516,750 |
|
|
Common stock |
|
543,415 |
|
|
|
542,939 |
|
|
|
542,340 |
|
|
|
541,762 |
|
|
|
541,519 |
|
|
Retained earnings |
|
351,751 |
|
|
|
335,145 |
|
|
|
319,865 |
|
|
|
303,490 |
|
|
|
287,555 |
|
|
Accumulated other comprehensive income (loss) |
|
1,499 |
|
|
|
(2,198 |
) |
|
|
(8,927 |
) |
|
|
(17,879 |
) |
|
|
(26,959 |
) |
|
Total shareholders’ equity |
$ |
896,665 |
|
|
$ |
875,886 |
|
|
$ |
853,278 |
|
|
$ |
827,373 |
|
|
$ |
802,115 |
|
|
Quarterly Average Balance Data |
|
|
|
|
|
|
|
|
|
|||||||||||
Average loans |
$ |
4,142,602 |
|
|
$ |
4,044,044 |
|
|
$ |
4,023,864 |
|
|
$ |
4,026,569 |
|
|
$ |
4,019,391 |
|
|
Average interest-earning assets |
$ |
5,810,248 |
|
|
$ |
5,764,966 |
|
|
$ |
5,759,966 |
|
|
$ |
5,679,845 |
|
|
$ |
5,629,091 |
|
|
Average total assets |
$ |
6,452,470 |
|
|
$ |
6,385,889 |
|
|
$ |
6,426,227 |
|
|
$ |
6,316,337 |
|
|
$ |
6,255,713 |
|
|
Average deposits |
$ |
5,327,235 |
|
|
$ |
5,370,879 |
|
|
$ |
5,387,079 |
|
|
$ |
5,242,139 |
|
|
$ |
5,068,841 |
|
|
Average borrowings and subordinated debt |
$ |
130,506 |
|
|
$ |
75,185 |
|
|
$ |
72,459 |
|
|
$ |
179,774 |
|
|
$ |
303,611 |
|
|
Average total equity |
$ |
890,667 |
|
|
$ |
866,284 |
|
|
$ |
843,090 |
|
|
$ |
812,525 |
|
|
$ |
797,131 |
|
|
Capital Ratio Data |
|
|
|
|
|
|
|
|
|
|||||||||||
Total risk based capital ratio |
|
15.2 |
% |
|
|
14.9 |
% |
|
|
14.4 |
% |
|
|
14.4 |
% |
|
|
13.9 |
% |
|
Tier 1 capital ratio |
|
14.5 |
% |
|
|
14.2 |
% |
|
|
13.6 |
% |
|
|
13.7 |
% |
|
|
13.2 |
% |
|
Tier 1 common equity ratio |
|
13.4 |
% |
|
|
13.0 |
% |
|
|
12.5 |
% |
|
|
12.5 |
% |
|
|
12.0 |
% |
|
Tier 1 leverage ratio |
|
11.3 |
% |
|
|
11.1 |
% |
|
|
10.6 |
% |
|
|
10.7 |
% |
|
|
10.7 |
% |
|
Tangible capital ratio (1) |
|
10.6 |
% |
|
|
10.2 |
% |
|
|
9.7 |
% |
|
|
9.5 |
% |
|
|
9.1 |
% |
|
(1) |
Tangible capital ratio is calculated by subtracting goodwill and other intangible assets from total shareholders’ equity and total assets and then dividing the adjusted assets by the adjusted equity. Management believes that the tangible capital ratio is meaningful because it is a measure that the Company and investors commonly use to assess capital adequacy. |
|
