First Guaranty Bancshares (FGBI) 8-K First Guaranty Bancshares, Inc. Announces Second Quarter 2023 Results

EXHIBIT 99.1

AUGUST 8, 2023

NEWS FOR IMMEDIATE RELEASE

CONTACT: ERIC J. DOSCH, CFO

985.375.0308

First Guaranty Bancshares, Inc. Announces Second Quarter 2023 Results

Hammond, Louisiana, August 8, 2023 – First Guaranty Bancshares, Inc. ("First Guaranty") (NASDAQ: FGBI), the holding company for First Guaranty Bank, announced its unaudited financial results for the quarter ending June 30, 2023.

Resilient: Springing back, rebounding. Returning to the original form for position after being bent, compressed or stretched. Recovering readily from illness, depression, adversity, or the like; buoyant. Random House Webster’s Unabridged Dictionary Second Edition.

Another good word is strong. An even better word is tough. These are words that describe what First Guaranty has been during a six month period in which we have survived wound after wound, not of our own causing as we continue to deliver to our shareholders, customers, and our staff members extraordinary results.

The latest of these have been the FDIC deposit insurance adjustment which was $450,000 for the second quarter.

Enough crying over spilt milk. This is what we did to make it better. Our interest income for the second quarter of 2023 increased to $43,781,000 compared to $32,540,000 for the second quarter of 2022. For the six months ending June 30, 2023, our interest income totaled $85,068,000 compared to $63,019,000. Our interest expense stabilized at $22,868,000 for the quarter compared to $41,854,000 for the six month period ending June 30, 2023.

We have significantly increased our loan interest income to offset the increased cost of deposits which are set by the Federal Reserve. For the quarter, we made over $2,000,000 for our shareholders even after the FDIC assessment.

Basically, we have and will continue to make a lot of money for our shareholders. We are working very hard to control non-interest expense. We are working very hard to expand our interest margin. Our lenders have done a great job working to increase the rates we receive for our loans.

Let’s keep moving forward. Let’s be resilient. Let’s be TOUGH.

Thank you for your attention.

Sincerely,

Alton B. Lewis

President and CEO

First Guaranty, Bancshares, Inc.

About First Guaranty

First Guaranty Bancshares, Inc. is the holding company for First Guaranty Bank, a Louisiana state-chartered bank. Founded in 1934, First Guaranty Bank offers a wide range of financial services and focuses on building client relationships and providing exceptional customer service. First Guaranty Bank currently operates thirty-six locations throughout Louisiana, Texas, Kentucky and West Virginia. First Guaranty’s common stock trades on the NASDAQ under the symbol FGBI. For more information, visit www.fgb.net.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements are any statements other than statements of historical fact which represent our current judgement about possible future events. We believe these judgements are reasonable, but these statements are not guarantees of any future events or financial results, and our actual results may differ materially due to a variety of factors, many of which are described in our most recent Annual Report on Form 10-K and our other filings with the U.S. Securities and Exchange Commission. We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or otherwise revise any forward-looking statements.

FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS (unaudited)
(in thousands, except share data)	June 30, 2023		December 31, 2022
Assets
Cash and cash equivalents:
Cash and due from banks	$	145,773	$	82,796
Federal funds sold	455		423
Cash and cash equivalents	146,228		83,219
Investment securities:
Available for sale, at fair value	80,153		131,458
Held to maturity, at cost and net of allowance for credit losses of $100 and $0 (estimated fair value of $250,008 and $242,560 respectively)	320,523		320,068
Investment securities	400,676		451,526
Federal Home Loan Bank stock, at cost	7,901		6,528
Loans held for sale	—		—
Loans, net of unearned income	2,590,666		2,519,077
Less: allowance for credit losses	31,861		23,518
Net loans	2,558,805		2,495,559
Premises and equipment, net	60,849		58,206
Goodwill	12,900		12,900
Intangible assets, net	4,583		4,979
Other real estate, net	1,273		113
Accrued interest receivable	15,099		13,002
Other assets	27,732		25,315
Total Assets	$	3,236,046	$	3,151,347
Liabilities and Shareholders' Equity
Deposits:
Noninterest-bearing demand	$	466,172	$	524,415
Interest-bearing demand	1,448,492		1,460,259
Savings	222,296		205,760
Time	630,459		533,358
Total deposits	2,767,419		2,723,792
Short-term advances from Federal Home Loan Bank	30,000		120,000
Short-term borrowings	20,000		20,000
Repurchase agreements	7,409		6,442
Accrued interest payable	6,996		4,289
Long-term advances from Federal Home Loan Bank	120,000		—
Senior long-term debt	20,305		21,927
Junior subordinated debentures	15,000		15,000
Other liabilities	10,060		4,906
Total Liabilities	2,997,189		2,916,356
Shareholders' Equity
Preferred stock, Series A - $1,000 par value - 100,000 shares authorized
Non-cumulative perpetual; 34,500 issued and outstanding	33,058		33,058
Common stock, $1 par value - 100,600,000 shares authorized; 11,431,083 and 10,716,796 shares issued and outstanding	11,431		10,717
Surplus	139,379		130,093
Retained earnings	69,887		76,351
Accumulated other comprehensive (loss) income	(14,898)		(15,228)
Total Shareholders' Equity	238,857		234,991
Total Liabilities and Shareholders' Equity	$	3,236,046	$	3,151,347
See Notes to Consolidated Financial Statements

FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands, except share data)	2023		2022		2023		2022
Interest Income:
Loans (including fees)	$	40,290	$	29,999	$	78,439	$	58,037
Deposits with other banks	1,071		261		1,822		363
Securities (including FHLB stock)	2,420		2,280		4,807		4,619
Total Interest Income	43,781		32,540		85,068		63,019
Interest Expense:
Demand deposits	15,036		2,884		28,085		5,160
Savings deposits	838		101		1,417		162
Time deposits	5,224		2,540		8,800		5,295
Borrowings	1,770		705		3,552		1,109
Total Interest Expense	22,868		6,230		41,854		11,726
Net Interest Income	20,913		26,310		43,214		51,293
Less: Provision for credit losses	548		757		862		1,389
Net Interest Income after Provision for Credit Losses	20,365		25,553		42,352		49,904
Noninterest Income:
Service charges, commissions and fees	818		773		1,603		1,550
ATM and debit card fees	828		904		1,653		1,727
Net gains (losses) on securities	—		—		—		(17)
Net gains on sale of loans	—		90		12		89
Other	1,166		760		2,248		1,140
Total Noninterest Income	2,812		2,527		5,516		4,489
Total Business Revenue, Net of Provision for Credit Losses	23,177		28,080		47,868		54,393
Noninterest Expense:
Salaries and employee benefits	9,932		9,085		19,936		18,065
Occupancy and equipment expense	2,219		2,252		4,421		4,453
Other	7,584		6,482		15,544		12,052
Total Noninterest Expense	19,735		17,819		39,901		34,570
Income Before Income Taxes	3,442		10,261		7,967		19,823
Less: Provision for income taxes	766		2,137		1,823		4,114
Net Income	2,676		8,124		6,144		15,709
Less: Preferred stock dividends	582		582		1,164		1,164
Net Income Available to Common Shareholders	$	2,094	$	7,542	$	4,980	$	14,545
Per Common Share:
Earnings	$	0.19	$	0.70	$	0.46	$	1.36
Cash dividends paid	$	0.16	$	0.16	$	0.32	$	0.32
Weighted Average Common Shares Outstanding	10,913,029		10,716,796		10,815,454		10,716,796
See Notes to Consolidated Financial Statements

FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited)
	Three Months Ended June 30, 2023						Three Months Ended June 30, 2022
(in thousands except for %)	Average Balance		Interest		Yield/Rate (5)		Average Balance		Interest		Yield/Rate (5)
Assets
Interest-earning assets:
Interest-earning deposits with banks	$	90,388	$	1,071	4.75	%	$	135,072	$	261	0.77	%
Securities (including FHLB stock)	407,689		2,420		2.38	%	455,224		2,280		2.01	%
Federal funds sold	410		—		—	%	162		—		—	%
Loans held for sale	—		—		—	%	—		—		—	%
Loans, net of unearned income (6)	2,568,051		40,290		6.29	%	2,244,110		29,999		5.36	%
Total interest-earning assets	3,066,538		$	43,781	5.73	%	2,834,568		$	32,540	4.60	%
Noninterest-earning assets:
Cash and due from banks	18,443						19,334
Premises and equipment, net	59,924						58,235
Other assets	28,958						28,828
Total Assets	$	3,173,863					$	2,940,965
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Demand deposits	$	1,458,353	$	15,036	4.14	%	$	1,327,954	$	2,884	0.87	%
Savings deposits	214,055		838		1.57	%	211,281		101		0.19	%
Time deposits	631,605		5,224		3.32	%	549,052		2,540		1.86	%
Borrowings	122,969		1,770		5.77	%	55,536		705		5.10	%
Total interest-bearing liabilities	2,426,982		$	22,868	3.78	%	2,143,823		$	6,230	1.17	%
Noninterest-bearing liabilities:
Demand deposits	496,209						563,832
Other	17,366						7,947
Total Liabilities	2,940,557						2,715,602
Shareholders' equity	233,306						225,363
Total Liabilities and Shareholders' Equity	$	3,173,863					$	2,940,965
Net interest income			$	20,913					$	26,310
Net interest rate spread (1)					1.95	%					3.43	%
Net interest-earning assets (2)	$	639,556					$	690,745
Net interest margin (3), (4)					2.74	%					3.72	%
Average interest-earning assets to interest-bearing liabilities					126.35	%					132.22	%

(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.

(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.

(3)Net interest margin represents net interest income divided by average total interest-earning assets.

(4)The tax adjusted net interest margin was 2.74% and 3.73% for the above periods ended June 30, 2023 and 2022 respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended June 30, 2023 and 2022 respectively.

(5)Annualized.

(6)Includes loan fees of $1.4 million and $2.5 million for the three months ended June 30, 2023 and 2022 respectively. PPP loan fee income of $11,000 and $0.5 million was recognized for the three months ended June 30, 2023 and 2022 respectively.

FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited)
	Six Months Ended June 30, 2023						Six Months Ended June 30, 2022
(in thousands except for %)	Average Balance		Interest		Yield/Rate (5)		Average Balance		Interest		Yield/Rate (5)
Assets
Interest-earning assets:
Interest-earning deposits with banks	$	81,497	$	1,822	4.51	%	$	183,047	$	363	0.40	%
Securities (including FHLB stock)	417,104		4,807		2.32	%	444,879		4,619		2.09	%
Federal funds sold	421		—		—	%	197		—		—	%
Loans held for sale	—		—		—	%	—		—		—	%
Loans, net of unearned income (6)	2,548,446		78,439		6.21	%	2,199,435		58,037		5.32	%
Total interest-earning assets	3,047,468		$	85,068	5.63	%	2,827,558		$	63,019	4.49	%
Noninterest-earning assets:
Cash and due from banks	18,853						18,910
Premises and equipment, net	59,043						58,314
Other assets	27,854						28,709
Total Assets	$	3,153,218					$	2,933,491
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Demand deposits	$	1,473,147	$	28,085	3.84	%	$	1,325,755	$	5,160	0.78	%
Savings deposits	209,190		1,417		1.37	%	207,664		162		0.16	%
Time deposits	596,575		8,800		2.97	%	562,550		5,295		1.90	%
Borrowings	121,892		3,552		5.88	%	51,732		1,109		4.32	%
Total interest-bearing liabilities	2,400,804		$	41,854	3.52	%	2,147,701		$	11,726	1.10	%
Noninterest-bearing liabilities:
Demand deposits	503,216						554,475
Other	15,071						7,396
Total Liabilities	2,919,091						2,709,572
Shareholders' equity	234,127						223,919
Total Liabilities and Shareholders' Equity	$	3,153,218					$	2,933,491
Net interest income			$	43,214					$	51,293
Net interest rate spread (1)					2.11	%					3.39	%
Net interest-earning assets (2)	$	646,664					$	679,857
Net interest margin (3), (4)					2.86	%					3.66	%
Average interest-earning assets to interest-bearing liabilities					126.94	%					131.66	%

(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.

(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.

(3)Net interest margin represents net interest income divided by average total interest-earning assets.

(4)The tax adjusted net interest margin was 2.86% and 3.66% for the above periods ended June 30, 2023 and 2022 respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended June 30, 2023 and 2022 respectively.

(5)Annualized.

(6)Includes loan fees of $2.8 million and $4.5 million for the six months ended June 30, 2023 and 2022 respectively. PPP loan fee income of $16,000 and $1.1 million was recognized for the six months ended June 30, 2023 and 2022 respectively.

The following table summarizes the components of First Guaranty's loan portfolio as of June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022:

	June 30, 2023				March 31, 2023				December 31, 2022				September 30, 2022
(in thousands except for %)	Balance		As % of Category		Balance		As % of Category		Balance		As % of Category		Balance		As % of Category
Real Estate:
Construction & land development	$	301,259	11.6	%	$	289,486	11.2	%	$	233,091	9.2	%	$	204,640	8.4	%
Farmland	29,398		1.1	%	23,065		0.9	%	24,823		1.0	%	24,556		1.0	%
1- 4 Family	406,148		15.6	%	385,984		14.9	%	366,330		14.5	%	352,501		14.5	%
Multifamily	121,342		4.7	%	120,620		4.7	%	119,785		4.7	%	118,273		4.9	%
Non-farm non-residential	1,025,073		39.5	%	1,027,199		39.8	%	992,929		39.3	%	981,954		40.5	%
Total Real Estate	1,883,220		72.5	%	1,846,354		71.5	%	1,736,958		68.7	%	1,681,924		69.3	%
Non-Real Estate:
Agricultural	47,924		1.8	%	40,351		1.6	%	39,045		1.5	%	47,642		2.0	%
Commercial and industrial(1)	338,023		13.0	%	344,332		13.3	%	385,279		15.3	%	365,549		15.1	%
Commercial leases	282,161		10.9	%	302,450		11.7	%	317,574		12.6	%	281,010		11.6	%
Consumer and other	47,771		1.8	%	49,157		1.9	%	47,864		1.9	%	48,188		2.0	%
Total Non-Real Estate	715,879		27.5	%	736,290		28.5	%	789,762		31.3	%	742,389		30.7	%
Total loans before unearned income	2,599,099		100.0	%	2,582,644		100.0	%	2,526,720		100.0	%	2,424,313		100.0	%
Unearned income	(8,433)				(8,402)				(7,643)				(6,986)
Total loans net of unearned income	$	2,590,666			$	2,574,242			$	2,519,077			$	2,417,327

(1) Includes PPP loans fully guaranteed by the SBA of $5.4 million, $5.7 million, $5.9 million, and $6.1 million at June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022, respectively.

The table below sets forth the amounts and categories of our nonperforming assets at the dates indicated.

(in thousands)	June 30, 2023			March 31, 2023			December 31, 2022			September 30, 2022
Nonaccrual loans:
Real Estate:
Construction and land development	$	518		$	221		$	225		$	104
Farmland	867			677			290			290
1- 4 family	6,320			6,209			3,826			3,646
Multifamily	537			—			—			—
Non-farm non-residential	8,285			2,675			3,746			2,629
Total Real Estate	16,527			9,782			8,087			6,669
Non-Real Estate:
Agricultural	1,375			1,469			1,622			1,645
Commercial and industrial	2,167			1,026			819			876
Commercial leases	1,818			1,799			1,799			—
Consumer and other	2,016			1,593			1,239			1,168
Total Non-Real Estate	7,376			5,887			5,479			3,689
Total nonaccrual loans	23,903			15,669			13,566			10,358
Loans 90 days and greater delinquent & accruing:
Real Estate:
Construction and land development	182			190			427			326
Farmland	—			—			—			—
1- 4 family	295			—			332			359
Multifamily	—			—			157			13
Non-farm non-residential	—			1,641			103			318
Total Real Estate	477			1,831			1,019			1,016
Non-Real Estate:
Agricultural	61			—			—			—
Commercial and industrial	—			6,244			123			444
Commercial leases	—			—			—			—
Consumer and other	—			—			—			—
Total Non-Real Estate	61			6,244			123			444
Total loans 90 days and greater delinquent & accruing	538			8,075			1,142			1,460
Total non-performing loans	24,441			23,744			14,708			11,818
Real Estate Owned:
Real Estate Loans:
Construction and land development	251			—			—			—
Farmland	—			—			—			—
1- 4 family	248			113			113			249
Multifamily	—			—			—			—
Non-farm non-residential	774			774			—			1,418
Total Real Estate	1,273			887			113			1,667
Non-Real Estate Loans:
Agricultural	—			—			—			—
Commercial and industrial	—			—			—			—
Commercial leases	—			—			—			—
Consumer and other	—			—			—			—
Total Non-Real Estate	—			—			—			—
Total Real Estate Owned	1,273			887			113			1,667
Total non-performing assets	$	25,714		$	24,631		$	14,821		$	13,485
Non-performing assets to total loans	0.99		%	0.96		%	0.59		%	0.56		%
Non-performing assets to total assets	0.79		%	0.76		%	0.47		%	0.44		%
Non-performing loans to total loans	0.94		%	0.92		%	0.58		%	0.49		%
Nonaccrual loans to total loans	0.92		%	0.61		%	0.54		%	0.43		%
Allowance for credit losses to nonaccrual loans	133.29		%	201.47		%	173.36		%	226.57		%

Non-GAAP Financial Measures

Our accounting and reporting policies conform to accounting principles generally accepted in the United States, or GAAP, and the prevailing practices in the banking industry. However, we also evaluate our performance based on certain additional metrics. Tangible book value per share and the ratio of tangible equity to tangible assets are not financial measures recognized under GAAP and, therefore, are considered non-GAAP financial measures.

Our management, banking regulators, many financial analysts and other investors use these non-GAAP financial measures to compare the capital adequacy of banking organizations with significant amounts of preferred equity and/or goodwill or other intangible assets, which typically stem from the use of the purchase accounting method of accounting for mergers and acquisitions. Tangible equity, tangible assets, tangible book value per share or related measures should not be considered in isolation or as a substitute for total shareholders' equity, total assets, book value per share or any other measure calculated in accordance with GAAP. Moreover, the manner in which we calculate tangible equity, tangible assets, tangible book value per share and any other related measures may differ from that of other companies reporting measures with similar names.

The following table reconciles, as of the dates set forth below, shareholders' equity (on a GAAP basis) to tangible equity and total assets (on a GAAP basis) to tangible assets and calculates our tangible book value per share.

	At June 30,			At December 31,
(in thousands except for share data and %)	2023			2022			2021			2020			2019
Tangible Common Equity
Total shareholders' equity	$	238,857		$	234,991		$	223,889		$	178,591		$	166,035
Adjustments:
Preferred	33,058			33,058			33,058			—			—
Goodwill	12,900			12,900			12,900			12,900			12,942
Acquisition intangibles	4,007			4,355			5,051			5,815			6,527
Tangible common equity	$	188,892		$	184,678		$	172,880		$	159,876		$	146,566
Common shares outstanding	11,431,083			10,716,796			10,716,796			10,716,796			10,716,796
Book value per common share	$	18.00		$	18.84		$	17.81		$	16.66		$	15.49
Tangible book value per common share	$	16.52		$	17.23		$	16.13		$	14.92		$	13.68
Tangible Assets
Total Assets	$	3,236,046		$	3,151,347		$	2,878,120		$	2,473,078		$	2,117,216
Adjustments:
Goodwill	12,900			12,900			12,900			12,900			12,942
Acquisition intangibles	4,007			4,355			5,051			5,815			6,527
Tangible Assets	$	3,219,139		$	3,134,092		$	2,860,169		$	2,454,363		$	2,097,747
Tangible common equity to tangible assets	5.87		%	5.89		%	6.04		%	6.51		%	6.99		%