For additional information, contact:
T. Heath Fountain
Executive Vice President and
Chief Financial Officer
(229) 878-2055
HERITAGE FINANCIAL GROUP, INC. REPORTS THIRD QUARTER NET INCOME OF
$1.3 MILLION OR $0.18 PER DILUTED SHARE
ALBANY, Ga. (October 24, 2013) – Heritage Financial Group, Inc. (NASDAQ: HBOS), the holding company for HeritageBank of the South, today announced unaudited financial results for the quarter ended September 30, 2013. Key aspects of the Company's results for the third quarter of 2013 include:
| · | Net income of $1.3 million or $0.18 per diluted share, down 50% from $2.7 million or $0.36 per diluted share for the linked quarter and down 34% from $2.0 million or $0.25 per diluted share for the year-earlier quarter; |
| · | Excluding special items for each quarter, net income of $1.8 million or $0.24 per diluted share, down 38% from $2.9 million or $0.39 per diluted share for the linked quarter and down 3% from $1.8 million or $0.23 per diluted share for the year-earlier quarter (see reconciliation of non-GAAP items); |
| · | Loan growth, excluding loans acquired through FDIC-assisted acquisitions, of $27.5 million or 4% on a linked-quarter basis and $123.7 million or 23% compared with the year-earlier quarter; |
| · | A decrease in FDIC-acquired loans of $8.3 million, or 6%, on a linked-quarter basis; |
| · | A decrease in the provision for loan losses, excluding FDIC-acquired loans, to $350,000, down 45% from $640,000 for the linked quarter and down 53% compared with $750,000 for the year-earlier quarter; |
| · | No provision for loan losses for FDIC-acquired loans for the current quarter compared with $28,000 for the linked quarter and $1.2 million for the year-earlier quarter; and |
| · | Non-performing assets to total assets declined to 1.03% for the third quarter of 2013 compared with 1.14% for the linked quarter and 1.68% for the year-earlier quarter. |
Commenting on the results, Leonard Dorminey, President and Chief Executive Officer, said, "While net income declined for the quarter, we continue to make progress on many items that will enhance our ongoing profitability. Organic loan growth continues to significantly outpace the decline in our FDIC-acquired portfolios. Expense management efforts continue to progress as we closed two FDIC-acquired branches during the quarter and made further staffing reductions in our branch network. However, our mortgage banking revenue declined during the quarter, a trend seen across the industry as interest rates have recently risen. Although this rate increase slowed our refinance activity dramatically, we remain excited about our mortgage expansion, as our business is focused primarily on financing home purchases. We are also pleased to have recently received approval to sell mortgage loans directly to Fannie Mae. With this approval, we expect to increase our wholesale mortgage production significantly, improve our margins and enhance the future profitability of our mortgage business."
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HBOS Reports Third Quarter 2013 Results
Page 2
October 24, 2013
Operating Initiatives
During the third quarter of 2013, the Company closed its branch in Vincent, Alabama and its Broadway Avenue branch in Sylacauga, Alabama, both of which were added with the FDIC-assisted acquisition of Frontier Bank in March 2013. The Company does not expect to experience a significant reduction in customer relationships and will serve these customers from other nearby locations. Also, the Company completed staffing reductions related to the Frontier acquisition that will result in a decrease of approximately $1.6 million from Frontier's pre-acquisition level of personnel expenses. Separately, the Company reduced Bank staffing by nine full-time equivalent employees, resulting in a one-time charge of $60,000 for severance for the third quarter of 2013, expected severance of $7,000 for the fourth quarter of 2013, and anticipates expense savings of approximately $460,000 per year related to this staffing reduction.
Third Quarter 2013 Results of Operations
The $1.3 million decrease in reported quarterly earnings for the third quarter of 2013 compared with the linked quarter resulted primarily from the following items:
| · | Decreased mortgage banking fees of $1.5 million; |
| · | Decreased loan discount accretion from FDIC-acquired loans of $2.4 million, partially offset by decreased negative accretion of the FDIC loss-share receivable of $1.9 million; |
| · | Increased legacy other real estate owned write-downs and foreclosed asset expenses of $387,000; |
| · | Increased acquisition-related expenses of $132,000; |
| · | Increased FDIC loss-share clawback expenses of $162,000; offset by |
| · | Increased interest income on core loans and loans held for sale of $320,000; |
| · | Decreased provision expense of $318,000; and |
`
| · | Increased service charges on deposit accounts of $280,000. |
Commenting on the third quarter results, Heath Fountain, Executive Vice President and Chief Financial Officer, said, "Loan discount accretion income can vary significantly based on the timing of asset resolutions, and will continue to cause volatility in earnings. However, our loan growth continues to provide momentum for our earnings, and service charges on deposit accounts continue to grow as we expand our customer base. These revenue enhancements, along with our expense management efforts, are driving ongoing improvement in the results of our core bank.
"While other real estate and foreclosed asset expenses increased, primarily relating to one legacy relationship, our asset quality trends continue to improve, as evidenced by the decrease in provision expense," Fountain continued. "Future increases in mortgage revenue will be based on our ability to increase production, and while the refinance business decreased significantly with recent increases in rates, we are encouraged by our current loan pipeline and our recent success in recruiting originators focused on the purchase market."
The $676,000 decline in reported quarterly earnings for the third quarter of 2013 compared with the year-earlier quarter primarily resulted from the following items:
| · | Increased non-interest expense of $2.9 million; |
| · | Reduced non-interest income of $927,000; offset by |
| · | Decreased provision expense of $1.6 million; and |
| · | Improved net interest income of $845,000. |
HBOS Reports Third Quarter 2013 Results
Page 3
October 24, 2013
Net interest income for the third quarter of 2013 increased 7% to $13.6 million from $12.7 million in the year-earlier quarter, primarily reflecting an increase in interest-earning assets related to both acquisitions and organic growth and a reduction in the cost of interest-bearing liabilities, offset in part by a reduction in FDIC-acquired loan discount accretion. The Company's net interest margin was 4.73% for the third quarter of 2013, a decline of 104 basis points from 5.77% for the year-earlier period. The reduction in net interest margin for the third quarter of 2013 compared with the year-earlier quarter was driven by a decline in the yield on loans and investment securities, offset in part with reductions in the cost of interest-bearing liabilities as rates continue to reset to lower levels and the Company takes advantage of historically low interest rates on non-deposit funding. Excluding FDIC-acquired loan discount adjustments from the net interest margin, the core net interest margin was 3.23% for the third quarter of 2013, a decrease of eight basis points from 3.31% for the year-earlier quarter.
In the third quarter of 2013, the Company continued to achieve loan growth, with its core loan portfolio increasing $27.5 million organically on a linked-quarter basis and advancing $123.7 million overall compared with the year-earlier quarter. For the third quarter of 2013, the Company's loan portfolio, including FDIC-acquired loans, totaled $789.1 million, increasing $19.2 million on a linked-quarter basis from $769.9 million and from $634.9 million compared with the year-earlier quarter. The organic loan growth for the linked quarter was primarily driven by growth in Statesboro, Albany, Valdosta, and Macon, Georgia and Auburn, Alabama markets. For the third quarter of 2013, the Company's loans held for sale totaled $38.0 million, decreasing $5.5 million, or 13%, on a linked-quarter basis from $43.5 million, but significantly increased $30.8 million, or 81%, from $7.2 million compared with the year-earlier quarter. Total deposits stood at $1.052 billion at the end of the third quarter of 2013, down 1% from $1.065 billion on a linked-quarter basis, but up 25% from $845.1 million at September 30, 2012.
Non-interest income for the third quarter of 2013 decreased 19% to $3.9 million from $4.8 million in the year-earlier quarter, primarily driven by a decline in the gain on sale of securities of $1.5 million and an increase in negative accretion for the FDIC loss-share receivable of $377,000, partially offset by increases in service charges on deposit accounts of $292,000 and mortgage banking fees of $264,000. Non-interest expense for the third quarter of 2013 increased 23% to $15.3 million from $12.5 million in the year-earlier quarter, primarily driven by increased salaries and employee benefits of $1.7 million associated with the hiring of employees from the Frontier acquisition and for the mortgage division. The increased equipment and occupancy expense of $615,000 related to the Company's continued efforts to expand the mortgage division and the Frontier acquisition. The increased acquisition-related expense resulted from final expenses associated to the conversion of the Frontier operating system.
Accounting for FDIC-Assisted Acquisitions
The Company performs ongoing assessments of the estimated cash flows of its FDIC-acquired loan portfolios. The fair value of the FDIC-acquired loan portfolios consisted of $53.8 million in covered and $69.7 million in non-covered loans at the end of the third quarter of 2013 compared with $78.8 million in covered and $14.3 million in non-covered loans for the year-earlier quarter. The outstanding principal balance of the FDIC-acquired loan portfolios totaled $195.5 million at the end of the third quarter of 2013 compared with $171.6 million for the year-earlier quarter. The details of the accounting for the FDIC-acquired loan portfolios for the third quarter of 2013 are as follows:
| · | Covered FDIC-acquired loans decreased $3.3 million from the linked quarter to $53.8 million; |
| · | Non-covered FDIC-acquired loans decreased $5.0 million to $69.7 million; |
| · | The FDIC loss-share receivable associated with covered assets acquired in FDIC-assisted acquisitions decreased $3.6 million to $44.5 million; |
HBOS Reports Third Quarter 2013 Results
Page 4
October 24, 2013
| · | The negative accretion for the FDIC loss-share receivable was $1.5 million and the FDIC loss-share clawback accrual increased to $1.7 million; |
| · | No provision expense was recorded for FDIC-acquired loans; |
| · | Loan discount accretion recognized in interest income declined $2.4 million; |
| · | The non-accretable discount decreased $6.6 million to $48.5 million; and |
| · | The accretable discount increased $438,000 to $23.4 million. |
For the third quarter of 2013, loan discount accretion recognized in interest income declined 39% to $3.7 million from $6.1 million for the linked quarter and declined 23% from $4.8 million for the year-earlier quarter. The FDIC loss-share receivable associated with covered FDIC-acquired assets decreased 7% to $44.5 million from $48.1 million for the linked quarter and declined 34% from $67.7 million for the year-earlier quarter. The reduction in the FDIC loss-share receivable for the linked quarter was primarily driven by negative accretion of $1.5 million affecting the loss-share receivable asset associated with the improvement in expected cash flows of the covered FDIC-acquired performing loan portfolios. An increase to the FDIC clawback liability accrual was recorded as an expense for the current quarter of $286,000, which increased the total accrual to $1.7 million. This clawback was caused by an improvement in estimates of expected cash flows for both FDIC-assisted acquisitions covered under loss-sharing agreements.
The covered FDIC-acquired loan discounts affecting the loss-share receivable was $42.7 million, or 95.9% of the loss-share receivable, for the third quarter 2013 compared with $65.8 million, or 97.3% of the loss-share receivable, for the year-earlier quarter. The gross balance of covered FDIC-acquired assets decreased to $116.2 million for the third quarter of 2013 compared with $173.6 million for the year-earlier quarter. The FDIC loss-share receivable as a percent of the covered FDIC-acquired assets decreased to 38.3% compared with 39.0% for the year-earlier quarter.
Asset Quality
Total non-performing assets, excluding FDIC-acquired assets, decreased to $13.6 million, or 1.03% of total assets, compared with $15.3 million, or 1.14% of total assets, for the linked quarter and declined from $17.8 million, or 1.68% of total assets, for the year-earlier quarter. Annualized net charge-offs to average outstanding loans, excluding FDIC-acquired loans, were 0.31% for the third quarter of 2013 compared with 0.45% for the linked quarter and 0.24% for the year-earlier quarter. Non-performing loans totaled $11.0 million, down from $12.2 million for the linked quarter and from $16.4 million for the year-earlier quarter. Other real estate owned and repossessed assets, excluding FDIC-acquired assets, totaled $2.7 million for the third quarter of 2013, down from $3.0 million for the linked quarter, but up from the $1.4 million for the year-earlier quarter. Approximately $900,000 of this increase is related to one relationship in the Albany, Georgia market area, which has been liquated subsequent to the end of the quarter.
The provision for loan losses on non-FDIC-acquired loans decreased to $350,000 for the third quarter of 2013 from $640,000 for the linked quarter and from $750,000 for the year-earlier quarter, primarily driven by improving trends in total criticized and classified assets. For the third quarter in 2013, the allowance for loan losses represented 1.34% of total loans outstanding, excluding FDIC-acquired loans, versus 1.42% for the linked quarter and 1.57% for the year-earlier quarter. The improving loan loss allowance is primarily the result of declining criticized and classified assets as a percentage of total loans.
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HBOS Reports Third Quarter 2013 Results
Page 5
October 24, 2013
Capital Management Initiatives
During the third quarter of 2013, the Company repurchased approximately 5,000 shares of common stock at an average price of $14.91 under its stock repurchase program. Authorization to repurchase approximately 344,000 shares remains under the current program, which is set to expire in April 2014, unless extended or otherwise completed.
The Company's estimated total risk-based capital ratio at September 30, 2013, was 14.3%, significantly exceeding the required minimum of 10% to be considered a well-capitalized institution. The ratio of tangible common equity to total tangible assets was 8.8% as of September 30, 2013.
Looking ahead, the Company intends to maintain its capital strength at the current level to support growth and its acquisition activities. Accordingly, future stock buybacks and future dividends will be premised largely on the Company's future earnings power rather than a return of capital to stockholders. As previously announced, it is not currently anticipated that any quarterly dividends will be paid in 2013, with the Company having accelerated 2013 dividends in December 2012, but the Company expects to resume regular quarterly dividends in 2014.
About Heritage Financial Group, Inc. and HeritageBank of the South
Heritage Financial Group, Inc. is the holding company for HeritageBank of the South, a community-oriented bank serving primarily South Georgia, North Central Florida and Eastern Alabama through 27 full-service branch locations, 12 mortgage offices, and 4 investment offices. As of September 30, 2013, the Company reported total assets of approximately $1.3 billion and total stockholders' equity of approximately $121 million. For more information about the Company, visit HeritageBank of the South on the Web at www.eheritagebank.com and see Investor Relations under About Us.
Cautionary Note Regarding Forward Looking Statements
Except for historical information contained herein, the matters included in this news release and other information in the Company's filings with the Securities and Exchange Commission may contain certain "forward-looking statements," within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements can be identified by the fact that they do not relate strictly to historical or current facts and often use words or phrases "opportunities," "prospects," "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," "intends" or similar expressions. The forward-looking statements made herein represent the current expectations, plans or forecasts of the Company's future results and revenues. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Reform Act of 1995 and includes this statement for purposes of these safe harbor provisions. These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and are often beyond the Company's control. Actual outcomes and results may differ materially from those expressed in, or implied by, any of these forward-looking statements. Investors should not place undue reliance on any forward-looking statement and should consider the uncertainties and risks, discussed under Item 1A. "Risk Factors" of the Company's 2012 Annual Report on Form 10-K and in any of the Company's subsequent SEC filings. Further information concerning the Company and its business, including additional factors that could materially affect the Company's financial results, is included in its other filings with the SEC.
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HBOS Reports Third Quarter 2013 Results
Page 6
October 24, 2013
HERITAGE FINANCIAL GROUP, INC.
Unaudited Reconciliation of Non-GAAP Measures Presented in Earnings Release
(Dollars in thousands, except per share data)
| | Three Months Ended | | | Nine Months Ended | |
| | September 30, | | | June 30, | | | September 30, | |
| | 2013 | | | 2012 | | | 2013 | | | 2013 | | | 2012 | |
| Total non-interest income | | $ | 3,918 | | | $ | 4,845 | | | $ | 2,569 | | | $ | 13,875 | | | $ | 11,308 | |
| Gain on sale of securities | | | – | | | | (1,484 | ) | | | – | | | | – | | | | (1,554 | ) |
| (Gain) loss on acquisitions | | | – | | | | 90 | | | | – | | | | (4,188 | ) | | | 56 | |
| Adjusted non-interest income | | $ | 3,918 | | | $ | 3,451 | | | $ | 2,569 | | | $ | 9,687 | | | $ | 9,810 | |
| | | | | | | | | | | | | | | | | | | | |
| Total non-interest expense | | $ | 15,334 | | | $ | 12,462 | | | $ | 14,555 | | | $ | 43,242 | | | $ | 33,938 | |
| Salaries and employee benefits – early retirement and severance expense | | | (60 | ) | | | (641 | ) | | | – | | | | (60 | ) | | | (641 | ) |
| Acquisition-related expenses | | | (280 | ) | | | (14 | ) | | | (148 | ) | | | (1,220 | ) | | | (414 | ) |
| Accrual of FDIC acquisitions estimated clawback liability | | | (286 | ) | | | (484 | ) | | | (124 | ) | | | (978 | ) | | | (484 | ) |
| Adjusted non-interest expense | | $ | 14,708 | | | $ | 11,323 | | | $ | 14,283 | | | $ | 40,984 | | | $ | 32,399 | |
| | | | | | | | | | | | | | | | | | | | |
| Net income as reported | | $ | 1,322 | | | $ | 1,998 | | | $ | 2,660 | | | $ | 7,910 | | | $ | 4,329 | |
| Total adjustments, net of tax* | | | 462 | | | | (161 | ) | | | 203 | | | | (1,370 | ) | | | 27 | |
| Adjusted net income | | $ | 1,784 | | | $ | 1,837 | | | $ | 2,863 | | | $ | 6,540 | | | $ | 4,356 | |
| | | | | | | | | | | | | | | | | | | | |
| Diluted earnings per share | | $ | 0.18 | | | $ | 0.25 | | | $ | 0.36 | | | $ | 1.05 | | | $ | 0.54 | |
| Total adjustments, net of tax* | | | 0.06 | | | | (0.02 | ) | | | 0.03 | | | | (0.18 | ) | | | 0.00 | |
| Adjusted diluted earnings per share | | $ | 0.24 | | | $ | 0.23 | | | $ | 0.39 | | | $ | 0.87 | | | $ | 0.54 | |
* The effective tax rate for the period presented is used to determine net of tax amounts.
Net Income and Diluted Earnings Per Share are presented in accordance with Generally Accepted Accounting Principles ("GAAP"). Adjusted Noninterest Income, Adjusted Noninterest Expense, Adjusted Net Income and Adjusted Diluted Earnings Per Share are non-GAAP financial measures. The Company believes that these non-GAAP measures aid in understanding and comparing current-year and prior-year results, both of which include unusual items of different natures. These non-GAAP measures should be viewed in addition to, and not as a substitute for, the Company's reported results.
Heritage Financial Group, Inc. and Subsidiary
Consolidated Balance Sheets
(Unaudited)
(Dollars in thousands)
| | (Unaudited) | | | | |
| | September 30, | | | December 31, | |
| | 2013 | | | | 2012* | |
| | | | | | | |
| Cash and due from banks | | $ | 28,862 | | | $ | 23,993 | |
| Interest-bearing deposits in banks | | | 13,992 | | | | 15,393 | |
| Federal funds sold | | | 6,900 | | | | 4,306 | |
| Cash and cash equivalents | | | 49,754 | | | | 43,692 | |
| | | | | | | | |
| Securities available for sale, at fair value | | | 303,635 | | | | 221,406 | |
| Federal Home Loan Bank stock, at cost | | | 5,992 | | | | 4,330 | |
| Other equity securities, at cost | | | 1,010 | | | | 1,010 | |
| Loans held for sale | | | 38,042 | | | | 15,608 | |
| Loans | | | 735,249 | | | | 597,579 | |
| Covered loans | | | 53,843 | | | | 72,425 | |
| Less allowance for loan losses | | | 8,894 | | | | 9,061 | |
| Loans, net | | | 780,198 | | | | 660,943 | |
| | | | | | | | |
| Other real estate owned | | | 4,335 | | | | 3,242 | |
| Covered other real estate owned | | | 5,909 | | | | 9,467 | |
| Total other real estate owned | | | 10,244 | | | | 12,709 | |
| | | | | | | | |
| FDIC loss-share receivable | | | 44,527 | | | | 60,731 | |
| Premises and equipment, net | | | 38,351 | | | | 33,015 | |
| Goodwill and intangible assets | | | 4,251 | | | | 4,235 | |
| Cash surrender value of bank owned life insurance | | | 23,986 | | | | 23,382 | |
| Other assets | | | 22,319 | | | | 16,445 | |
| Total assets | | $ | 1,322,309 | | | $ | 1,097,506 | |
| | | | | | | | |
LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | |
| | | | | | | | |
| Non-interest-bearing deposits | | $ | 153,163 | | | $ | 116,272 | |
| Interest-bearing deposits | | | 899,318 | | | | 753,282 | |
| Total deposits | | | 1,052,481 | | | | 869,554 | |
| | | | | | | | |
| Federal funds purchased and securities sold under repurchase agreements | | | 35,393 | | | | 33,219 | |
| Other borrowings | | | 101,667 | | | | 60,000 | |
| Other liabilities | | | 12,234 | | | | 14,084 | |
| Total liabilities | | | 1,201,775 | | | | 976,857 | |
| | | | | | | | |
SHAREHOLDERS' EQUITY | | | | | | | | |
| | | | | | | | |
| Preferred stock, par value; $0.01; 5,000,000 shares authorized; none issued | | | - | | | | - | |
Common stock, par value $0.01; 45,000,000 shares authorized;7,834,765 and 8,172,486 shares issued and outstanding, respectively | | | 78 | | | | 82 | |
| Capital surplus | | | 78,262 | | | | 82,154 | |
| Retained earnings | | | 54,209 | | | | 46,299 | |
| Accumulated other comprehensive loss, net of tax of $5,621 and $2,566, respectively | | | (8,431 | ) | | | (3,849 | ) |
| Unearned employee stock ownership plan (ESOP), 345,860 and 385,836 shares, respectively | | | (3,584 | ) | | | (4,037 | ) |
| Total shareholders' equity | | | 120,534 | | | | 120,649 | |
| | | | | | | | |
| Total liabilities & shareholders' equity | | $ | 1,322,309 | | | $ | 1,097,506 | |
* Derived from Audited Consolidated Financial Statements.
Heritage Financial Group, Inc. and Subsidiary
Consolidated Statements of Income
(Unaudited)
(Dollars in thousands except share and per share data)
| | Three Months Ended | | | Nine Months Ended | |
| | September 30, | | | September 30, | | | September 30, | | | September 30, | |
| | 2013 | | | 2012 | | | 2013 | | | 2012 | |
| | | | | | | | | | | | |
Interest income: | | | | | | | | | | | | |
| Interest and fees on loans | | $ | 13,452 | | | $ | 13,067 | | | $ | 42,523 | | | $ | 33,747 | |
| Interest on loans held for sale | | | 434 | | | | 342 | | | | 839 | | | | 729 | |
| Interest on taxable securities | | | 1,155 | | | | 924 | | | | 3,116 | | | | 2,919 | |
| Interest on nontaxable securities | | | 318 | | | | 298 | | | | 911 | | | | 891 | |
| Interest on federal funds sold | | | 4 | | | | 3 | | | | 7 | | | | 21 | |
| Interest on deposits in other banks | | | 30 | | | | 17 | | | | 140 | | | | 80 | |
| Total interest income | | | 15,393 | | | | 14,651 | | | | 47,536 | | | | 38,387 | |
| | | | | | | | | | | | | | | | |
Interest expense: | | | | | | | | | | | | | | | | |
| Interest on deposits | | | 982 | | | | 1,257 | | | | 3,077 | | | | 3,766 | |
| Interest on other borrowings | | | 853 | | | | 681 | | | | 2,446 | | | | 2,025 | |
| Total interest expense | | | 1,835 | | | | 1,938 | | | | 5,523 | | | | 5,791 | |
| | | | | | | | | | | | | | | | |
| Net interest income | | | 13,558 | | | | 12,713 | | | | 42,013 | | | | 32,596 | |
| | | | | | | | | | | | | | | | |
| Provision for loan losses | | | 350 | | | | 1,934 | | | | 1,503 | | | | 3,424 | |
| | | | | | | | | | | | | | | | |
| Net interest income after provision for loan losses | | | 13,208 | | | | 10,779 | | | | 40,510 | | | | 29,172 | |
| | | | | | | | | | | | | | | | |
Non-interest income: | | | | | | | | | | | | | | | | |
| Service charges on deposit accounts | | | 1,577 | | | | 1,285 | | | | 4,028 | | | | 3,441 | |
| Bankcard services income | | | 852 | | | | 783 | | | | 2,445 | | | | 2,437 | |
| Other service charges, commissions and fees | | | 136 | | | | 80 | | | | 392 | | | | 238 | |
| Brokerage fees | | | 561 | | | | 467 | | | | 1,578 | | | | 1,375 | |
| Mortgage banking activities | | | 1,953 | | | | 1,689 | | | | 7,560 | | | | 3,316 | |
| Bank-owned life insurance | | | 200 | | | | 210 | | | | 603 | | | | 561 | |
| Gain on sales of securities | | | - | | | | 1,484 | | | | - | | | | 1,554 | |
| Gain (loss) on acquisitions | | | - | | | | (90 | ) | | | 4,188 | | | | (56 | ) |
| Accretion of FDIC loss-share receivable | | | (1,499 | ) | | | (1,122 | ) | | | (7,275 | ) | | | (1,752 | ) |
| Other | | | 138 | | | | 59 | | | | 356 | | | | 194 | |
| Total non-interest income | | | 3,918 | | | | 4,845 | | | | 13,875 | | | | 11,308 | |
Non-interest expense: | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 8,108 | | | | 6,380 | | | | 22,723 | | | | 17,376 | |
| Equipment and occupancy | | | 1,932 | | | | 1,317 | | | | 5,436 | | | | 4,035 | |
| Advertising and marketing | | | 335 | | | | 114 | | | | 871 | | | | 509 | |
| Professional fees | | | 340 | | | | 354 | | | | 857 | | | | 932 | |
| Information services expenses | | | 1,335 | | | | 1,240 | | | | 3,824 | | | | 3,456 | |
| Loss (gain) on sales and write-downs of other real estate owned | | | 335 | | | | 90 | | | | 368 | | | | (58 | ) |
| Gain on sales and write-downs of FDIC-acquired other real estate owned | | | (206 | ) | | | (33 | ) | | | (433 | ) | | | (108 | ) |
| Foreclosed asset expenses | | | 337 | | | | 177 | | | | 779 | | | | 617 | |
| Foreclosed FDIC-acquired asset expenses | | | 353 | | | | 563 | | | | 1,087 | | | | 1,191 | |
| FDIC insurance and other regulatory fees | | | 293 | | | | 276 | | | | 827 | | | | 785 | |
| Acquisition related expenses | | | 280 | | | | 14 | | | | 1,220 | | | | 414 | |
| Deposit intangible expenses | | | 204 | | | | 194 | | | | 609 | | | | 590 | |
| FDIC loss-share clawback expenses | | | 286 | | | | 484 | | | | 978 | | | | 484 | |
| Other operating expenses | | | 1,402 | | | | 1,292 | | | | 4,096 | | | | 3,715 | |
| Total non-interest expense | | | 15,334 | | | | 12,462 | | | | 43,242 | | | | 33,938 | |
| | | | | | | | | | | | | | | | |
| Income before income taxes | | | 1,792 | | | | 3,162 | | | | 11,143 | | | | 6,542 | |
| | | | | | | | | | | | | | | | |
| Applicable income tax | | | 470 | | | | 1,164 | | | | 3,233 | | | | 2,213 | |
| Net income | | $ | 1,322 | | | $ | 1,998 | | | $ | 7,910 | | | $ | 4,329 | |
| | | | | | | | | | | | | | | | |
Earnings per common share: | | | | | | | | | | | | | | | | |
| Basic earnings per share | | $ | 0.18 | | | $ | 0.25 | | | $ | 1.07 | | | $ | 0.54 | |
| Diluted earnings per share | | $ | 0.18 | | | $ | 0.25 | | | $ | 1.05 | | | $ | 0.54 | |
| | | | | | | | | | | | | | | | |
Weighted average-common shares outstanding: | | | | | | | | | | | | | | | | |
| Basic | | | 7,371,804 | | | | 7,942,852 | | | | 7,425,940 | | | | 8,052,462 | |
| Diluted | | | 7,483,812 | | | | 7,944,983 | | | | 7,519,664 | | | | 8,054,183 | |
Heritage Financial Group, Inc. and Subsidiary
Consolidated Statements of Income
(Unaudited)
(Dollars in thousands except share and per share data)
| | Five Quarter Comparison | |
| | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
Interest income: | | | | | | | | | | | | | | | |
| Interest and fees on loans | | $ | 13,452 | | | $ | 15,702 | | | $ | 13,369 | | | $ | 15,084 | | | $ | 13,067 | |
| Interest on loans held for sale | | | 434 | | | | 290 | | | | 115 | | | | 238 | | | | 342 | |
| Interest on taxable securities | | | 1,155 | | | | 1,095 | | | | 866 | | | | 762 | | | | 924 | |
| Interest on nontaxable securities | | | 318 | | | | 308 | | | | 285 | | | | 232 | | | | 298 | |
| Interest on federal funds sold | | | 4 | | | | 2 | | | | 1 | | | | 9 | | | | 3 | |
| Interest on deposits in other banks | | | 30 | | | | 88 | | | | 22 | | | | 26 | | | | 17 | |
| Total interest income | | | 15,393 | | | | 17,485 | | | | 14,658 | | | | 16,351 | | | | 14,651 | |
| | | | | | | | | | | | | | | | | | | | |
Interest expense: | | | | | | | | | | | | | | | | | | | | |
| Interest on deposits | | | 982 | | | | 1,041 | | | | 1,054 | | | | 1,108 | | | | 1,257 | |
| Interest on other borrowings | | | 853 | | | | 844 | | | | 749 | | | | 713 | | | | 681 | |
| Total interest expense | | | 1,835 | | | | 1,885 | | | | 1,803 | | | | 1,821 | | | | 1,938 | |
| | | | | | | | | | | | | | | | | | | | |
| Net interest income | | | 13,558 | | | | 15,600 | | | | 12,855 | | | | 14,530 | | | | 12,713 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Provision for loan losses | | | 350 | | | | 640 | | | | 450 | | | | 600 | | | | 750 | |
| Provision for loan losses- FDIC-acquired covered | | | - | | | | 28 | | | | 35 | | | | 1,907 | | | | 1,172 | |
| Provision for loan losses- FDIC-acquired non-covered | | | - | | | | - | | | | - | | | | - | | | | 12 | |
| | | | | | | | | | | | | | | | | | | | |
| Net interest income after provision for loan losses | | | 13,208 | | | | 14,932 | | | | 12,370 | | | | 12,023 | | | | 10,779 | |
| | | | | | | | | | | | | | | | | | | | |
Non-interest income: | | | | | | | | | | | | | | | | | | | | |
| Service charges on deposit accounts | | | 1,577 | | | | 1,297 | | | | 1,154 | | | | 1,307 | | | | 1,285 | |
| Bankcard services income | | | 852 | | | | 831 | | | | 762 | | | | 794 | | | | 783 | |
| Other service charges, commissions and fees | | | 136 | | | | 157 | | | | 99 | | | | 89 | | | | 80 | |
| Brokerage fees | | | 561 | | | | 536 | | | | 481 | | | | 463 | | | | 467 | |
| Mortgage banking activities | | | 1,953 | | | | 3,425 | | | | 2,182 | | | | 1,451 | | | | 1,689 | |
| Bank-owned life insurance | | | 200 | | | | 201 | | | | 202 | | | | 210 | | | | 210 | |
| Gain on sales of securities | | | - | | | | - | | | | - | | | | 1,285 | | | | 1,484 | |
| Gain (loss) on acquisitions | | | - | | | | - | | | | 4,188 | | | | - | | | | (90 | ) |
| Accretion of FDIC loss-share receivable | | | (1,499 | ) | | | (3,376 | ) | | | (2,397 | ) | | | (2,573 | ) | | | (1,122 | ) |
| Other | | | 138 | | | | 124 | | | | 94 | | | | 66 | | | | 59 | |
| Total non-interest income | | | 3,918 | | | | 3,195 | | | | 6,765 | | | | 3,092 | | | | 4,845 | |
Non-interest expense: | | | | | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 8,108 | | | | 8,185 | | | | 6,430 | | | | 6,167 | | | | 6,380 | |
| Equipment and occupancy | | | 1,932 | | | | 1,838 | | | | 1,666 | | | | 1,597 | | | | 1,317 | |
| Advertising and marketing | | | 335 | | | | 349 | | | | 187 | | | | 147 | | | | 114 | |
| Professional fees | | | 340 | | | | 302 | | | | 215 | | | | 387 | | | | 354 | |
| Information services expenses | | | 1,335 | | | | 1,307 | | | | 1,182 | | | | 1,184 | | | | 1,240 | |
| Loss (gain) on sales and write-downs of other real estate owned | | | 335 | | | | 58 | | | | (25 | ) | | | 277 | | | | 90 | |
| (Gain) loss on sales and write-downs of FDIC-acquired other real estate owned | | | (206 | ) | | | (251 | ) | | | 24 | | | | (204 | ) | | | (33 | ) |
| Foreclosed asset expenses | | | 337 | | | | 227 | | | | 215 | | | | 353 | | | | 177 | |
| Foreclosed FDIC-acquired asset expenses | | | 353 | | | | 313 | | | | 421 | | | | 575 | | | | 563 | |
| FDIC insurance and other regulatory fees | | | 293 | | | | 278 | | | | 256 | | | | 252 | | | | 276 | |
| Acquisition related expenses | | | 280 | | | | 148 | | | | 792 | | | | 3 | | | | 14 | |
| Deposit intangible expenses | | | 204 | | | | 211 | | | | 194 | | | | 191 | | | | 194 | |
| FDIC loss-share clawback expenses | | | 286 | | | | 124 | | | | 566 | | | | 219 | | | | 484 | |
| Other operating expenses | | | 1,402 | | | | 1,466 | | | | 1,233 | | | | 1,166 | | | | 1,292 | |
| Total non-interest expense | | | 15,334 | | | | 14,555 | | | | 13,356 | | | | 12,314 | | | | 12,462 | |
| | | | | | | | | | | | | | | | | | | | |
| Income before income taxes | | | 1,792 | | | | 3,572 | | | | 5,779 | | | | 2,801 | | | | 3,162 | |
| | | | | | | | | | | | | | | | | | | | |
| Applicable income tax | | | 470 | | | | 912 | | | | 1,851 | | | | 373 | | | | 1,164 | |
| Net income | | $ | 1,322 | | | $ | 2,660 | | | $ | 3,928 | | | $ | 2,428 | | | $ | 1,998 | |
| | | | | | | | | | | | | | | | | | | | |
Earnings per common share: | | | | | | | | | | | | | | | | | | | | |
| Basic earnings per share | | $ | 0.18 | | | $ | 0.36 | | | $ | 0.52 | | | $ | 0.31 | | | $ | 0.25 | |
| Diluted earnings per share | | $ | 0.18 | | | $ | 0.36 | | | $ | 0.52 | | | $ | 0.31 | | | $ | 0.25 | |
| Dividends | | $ | 0.00 | | | $ | 0.00 | | | $ | 0.00 | | | $ | 0.24 | | | $ | 0.04 | |
| | | | | | | | | | | | | | | | | | | | |
Weighted average-common shares outstanding: | | | | | | | | | | | | | | | | | | | | |
| Basic | | | 7,371,804 | | | | 7,381,370 | | | | 7,526,344 | | | | 7,720,839 | | | | 7,942,852 | |
| Diluted | | | 7,483,812 | | | | 7,383,992 | | | | 7,528,522 | | | | 7,722,867 | | | | 7,944,983 | |
Heritage Financial Group, Inc. and Subsidiary
Condensed Average Balances, Interest Rates and Yields
(Unaudited)
(Dollars in thousands)
| | Three Months Ended | | | Nine Months Ended | |
| | September 30, | | | September 30, | |
| | 2013 | | | 2012 | | | 2013 | | | 2012 | |
| | Average | | | | | | Average | | | Average | | | | | | Average | | | Average | | | | | | Average | | | Average | | | | | | Average | |
| | Balance | | | Interest | | | Rate | | | Balance | | | Interest | | | Rate | | | Balance | | | Interest | | | Rate | | | Balance | | | Interest | | | Rate | |
Interest-earning assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans(1)(2) | | $ | 817,366 | | | $ | 13,891 | | | | 6.74 | % | | $ | 622,643 | | | $ | 13,411 | | | | 8.57 | % | | $ | 770,383 | | | $ | 43,371 | | | | 7.53 | % | | $ | 592,060 | | | $ | 34,482 | | | | 7.78 | % |
Investment securities (2) | | | 303,349 | | | | 1,582 | | | | 2.07 | % | | | 235,862 | | | | 1,322 | | | | 2.23 | % | | | 278,438 | | | | 4,337 | | | | 2.08 | % | | | 249,826 | | | | 4,113 | | | | 2.20 | % |
| Other short-term investments | | | 26,862 | | | | 34 | | | | 0.50 | % | | | 24,814 | | | | 20 | | | | 0.32 | % | | | 50,941 | | | | 147 | | | | 0.39 | % | | | 37,613 | | | | 102 | | | | 0.36 | % |
| Total interest-earning assets | | | 1,147,577 | | | | 15,507 | | | | 5.36 | % | | | 883,319 | | | | 14,753 | | | | 6.64 | % | | | 1,099,762 | | | | 47,855 | | | | 5.82 | % | | | 879,499 | | | | 38,697 | | | | 5.88 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Non-interest earning assets | | | 179,188 | | | | | | | | | | | | 186,811 | | | | | | | | | | | | 177,064 | | | | | | | | | | | | 186,202 | | | | | | | | | |
| Total assets | | $ | 1,326,765 | | | | | | | | | | | $ | 1,070,130 | | | | | | | | | | | $ | 1,276,826 | | | | | | | | | | | $ | 1,065,701 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Deposits: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest checking, money market and savings | | $ | 549,561 | | | $ | 306 | | | | 0.22 | % | | $ | 475,975 | | | $ | 313 | | | | 0.26 | % | | $ | 532,053 | | | $ | 918 | | | | 0.23 | % | | $ | 470,557 | | | $ | 1,071 | | | | 0.30 | % |
| Time deposits | | | 359,631 | | | | 676 | | | | 0.75 | % | | | 292,272 | | | | 944 | | | | 1.28 | % | | | 348,095 | | | | 2,159 | | | | 0.83 | % | | | 300,657 | | | | 2,695 | | | | 1.20 | % |
| Total interest bearing-deposits | | | 909,192 | | | | 982 | | | | 0.43 | % | | | 768,247 | | | | 1,257 | | | | 0.65 | % | | | 880,148 | | | | 3,077 | | | | 0.47 | % | | | 771,214 | | | | 3,766 | | | | 0.65 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Federal Funds purchased and securities sold under repurchase agreements | | | 33,965 | | | | 335 | | | | 3.91 | % | | | 33,916 | | | | 335 | | | | 3.93 | % | | | 33,846 | | | | 995 | | | | 3.93 | % | | | 33,259 | | | | 996 | | | | 4.00 | % |
| Other Borrowings | | | 101,814 | | | | 518 | | | | 2.02 | % | | | 35,326 | | | | 346 | | | | 3.90 | % | | | 90,096 | | | | 1,451 | | | | 2.15 | % | | | 35,109 | | | | 1,029 | | | | 3.91 | % |
| Total interest-bearing liabilities | | | 1,044,971 | | | | 1,835 | | | | 0.70 | % | | | 837,489 | | | | 1,938 | | | | 0.92 | % | | | 1,004,090 | | | | 5,523 | | | | 0.74 | % | | | 839,582 | | | | 5,791 | | | | 0.92 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Non-interest bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Demand Deposits | | | 150,840 | | | | | | | | | | | | 94,453 | | | | | | | | | | | | 139,208 | | | | | | | | | | | | 89,719 | | | | | | | | | |
| Other Liabilities | | | 12,120 | | | | | | | | | | | | 13,304 | | | | | | | | | | | | 13,091 | | | | | | | | | | | | 11,248 | | | | | | | | | |
| Total non-interest bearing liabilities | | | 162,960 | | | | | | | | | | | | 107,757 | | | | | | | | | | | | 152,299 | | | | | | | | | | | | 100,967 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total liabilities | | | 1,207,931 | | | | | | | | | | | | 945,246 | | | | | | | | | | | | 1,156,389 | | | | | | | | | | | | 940,549 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Shareholders' equity | | | 118,834 | | | | | | | | | | | | 124,884 | | | | | | | | | | | | 120,437 | | | | | | | | | | | | 125,152 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total liabilities & shareholders' equity | | $ | 1,326,765 | | | | | | | | | | | $ | 1,070,130 | | | | | | | | | | | $ | 1,276,826 | | | | | | | | | | | $ | 1,065,701 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | | | | | $ | 13,672 | | | | | | | | | | | $ | 12,815 | | | | | | | | | | | $ | 42,332 | | | | | | | | | | | $ | 32,906 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest rate spread | | | | | | | | | | | 4.66 | % | | | | | | | | | | | 5.72 | % | | | | | | | | | | | 5.08 | % | | | | | | | | | | | 4.96 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net yield on interest-earning assets (net interest margin) | | | | | | | | | | | 4.73 | % | | | | | | | | | | | 5.77 | % | | | | | | | | | | | 5.15 | % | | | | | | | | | | | 5.00 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Core net interest margin (non-GAAP): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans(1)(2) | | $ | 817,366 | | | $ | 13,891 | | | | 6.74 | % | | $ | 622,643 | | | $ | 13,411 | | | | 8.57 | % | | $ | 770,383 | | | $ | 43,371 | | | | 7.53 | % | | $ | 592,060 | | | $ | 34,482 | | | | 7.78 | % |
FDIC-acquired loan discount adjustments(3) | | | 75,023 | | | | 3,718 | | | | 19.66 | % | | | 81,643 | | | | 4,778 | | | | 23.28 | % | | | 75,118 | | | | 14,450 | | | | 25.72 | % | | | 90,772 | | | | 9,063 | | | | 13.34 | % |
| Adjusted loans | | | 892,389 | | | | 10,173 | | | | 4.52 | % | | | 704,286 | | | | 8,633 | | | | 4.88 | % | | | 845,501 | | | | 28,921 | | | | 4.57 | % | | | 682,832 | | | | 25,419 | | | | 4.97 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Adjusted total interest-earning assets | | $ | 1,222,600 | | | | 11,789 | | | | 3.83 | % | | $ | 964,962 | | | | 9,975 | | | | 4.11 | % | | $ | 1,174,880 | | | | 33,405 | | | | 3.80 | % | | $ | 970,271 | | | | 29,634 | | | | 4.08 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total interest-bearing liabilities | | $ | 1,044,971 | | | | 1,835 | | | | 0.70 | % | | $ | 837,489 | | | | 1,938 | | | | 0.92 | % | | $ | 1,004,090 | | | | 5,523 | | | | 0.74 | % | | $ | 839,582 | | | | 5,791 | | | | 0.92 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Core Net interest income | | | | | | $ | 9,954 | | | | | | | | | | | $ | 8,037 | | | | | | | | | | | $ | 27,882 | | | | | | | | | | | $ | 23,843 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Core Interest rate spread | | | | | | | | | | | 3.13 | % | | | | | | | | | | | 3.19 | % | | | | | | | | | | | 3.07 | % | | | | | | | | | | | 3.16 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Core Net yield on interest-earning assets (net interest margin non-GAAP) | | | | | | | | | | | 3.23 | % | | | | | | | | | | | 3.31 | % | | | | | | | | | | | 3.17 | % | | | | | | | | | | | 3.28 | % |
| (1) | Average loan balances includes nonaccrual loans for the periods presented. |
| (2) | Fully Taxable Equivalent (“FTE”) at the rate of 34%. The FTE basis adjusts for the tax benefits of income on certain tax-exempt loans and investments using the federal statutory rate of 34% for each period presented. The Company believes this measure to be the preferred industry measurement of net interest income and provides relevant comparison between taxable and non-taxable amounts. |
| (3) | FDIC-acquired loan discount adjustments include the reduction of interest income for FDIC-acquired loan discount accretion excluding contractual interest payments and the increase of core loans for the total balance of FDIC-acquired loan discounts. |
Heritage Financial Group, Inc. and Subsidiary
Consolidated Financial Highlights
(Unaudited)
(Dollars in thousands except share and per share data)
| | Five Quarter Comparison | |
Financial Condition Data: | | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
| Total loans | | $ | 789,092 | | | $ | 769,921 | | | $ | 752,866 | | | $ | 670,004 | | | $ | 634,932 | |
| Loans held for sale | | | 38,042 | | | | 43,545 | | | | 18,905 | | | | 15,608 | | | | 7,236 | |
| Covered loans | | | 53,843 | | | | 57,176 | | | | 65,815 | | | | 72,425 | | | | 78,757 | |
| Allowance for loan losses | | | 8,894 | | | | 9,047 | | | | 9,105 | | | | 9,061 | | | | 8,530 | |
| Total other real estate owned | | | 10,244 | | | | 11,949 | | | | 13,851 | | | | 12,709 | | | | 11,458 | |
| Covered other real estate owned | | | 5,909 | | | | 7,815 | | | | 9,460 | | | | 9,467 | | | | 9,457 | |
| FDIC loss-share receivable | | | 44,527 | | | | 48,106 | | | | 52,012 | | | | 60,731 | | | | 67,698 | |
| Goodwill and intangible assets | | | 4,251 | | | | 4,455 | | | | 4,666 | | | | 4,235 | | | | 4,426 | |
| Total assets | | | 1,322,309 | | | | 1,334,016 | | | | 1,370,550 | | | | 1,097,506 | | | | 1,054,899 | |
| Non-interest-bearing deposits | | | 153,163 | | | | 148,219 | | | | 151,709 | | | | 116,272 | | | | 108,767 | |
| Interest-bearing deposits | | | 899,318 | | | | 917,712 | | | | 943,850 | | | | 753,282 | | | | 736,312 | |
| Other borrowings | | | 101,667 | | | | 101,940 | | | | 102,210 | | | | 60,000 | | | | 35,000 | |
| Federal funds purchased and securities sold under agreement to repurchase | | | 35,393 | | | | 33,094 | | | | 34,251 | | | | 33,219 | | | | 35,833 | |
| Stockholders' equity | | | 120,534 | | | | 118,540 | | | | 120,655 | | | | 120,649 | | | | 121,793 | |
| | | | | | | | | | | | | | | | | | | | |
| Total shares outstanding | | | 7,834,765 | | | | 7,803,910 | | | | 7,881,260 | | | | 8,172,486 | | | | 8,229,955 | |
| Unearned ESOP shares | | | 345,860 | | | | 359,186 | | | | 372,511 | | | | 385,836 | | | | 399,162 | |
| Total shares outstanding net of unearned ESOP | | | 7,488,905 | | | | 7,444,724 | | | | 7,508,749 | | | | 7,786,650 | | | | 7,830,793 | |
| | | | | | | | | | | | | | | | | | | | |
| Book value per share | | $ | 16.10 | | | $ | 15.92 | | | $ | 16.07 | | | $ | 15.49 | | | $ | 15.55 | |
| Book value per share including unearned | | | | | | | | | | | | | | | | | | | | |
| ESOP (non-GAAP) | | | 15.38 | | | | 15.19 | | | | 15.31 | | | | 14.76 | | | | 14.80 | |
| Tangible book value per share (non-GAAP) | | | 15.53 | | | | 15.32 | | | | 15.45 | | | | 14.95 | | | | 14.99 | |
| Tangible book value per share including unearned ESOP (non-GAAP) | | | 14.84 | | | | 14.62 | | | | 14.72 | | | | 14.24 | | | | 14.26 | |
| Market value per share | | | 17.42 | | | | 14.75 | | | | 14.48 | | | | 13.79 | | | | 13.14 | |
| | Five Quarter Comparison | |
| | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
Key Financial Ratios and other information: | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| Performance Ratios | | | | | | | | | | | | | | | |
| Annualized return on average assets | | | 0.40 | % | | | 0.79 | % | | | 1.37 | % | | | 0.89 | % | | | 0.75 | % |
| Annualized return on average equity | | | 4.41 | % | | | 8.74 | % | | | 13.01 | % | | | 7.90 | % | | | 6.40 | % |
| Net interest margin | | | 4.73 | % | | | 5.61 | % | | | 5.51 | % | | | 6.37 | % | | | 5.77 | % |
| Net interest spread | | | 4.66 | % | | | 5.55 | % | | | 5.44 | % | | | 6.30 | % | | | 5.72 | % |
| Efficiency ratio | | | 82.29 | % | | | 74.17 | % | | | 80.22 | % | | | 69.50 | % | | | 70.15 | % |
| | | | | | | | | | | | | | | | | | | | |
| Capital Ratios | | | | | | | | | | | | | | | | | | | | |
| Average stockholders' equity to average assets | | | 9.0 | % | | | 9.0 | % | | | 10.5 | % | | | 11.3 | % | | | 11.7 | % |
| Tangible equity to tangible assets (non-GAAP) | | | 8.8 | % | | | 8.6 | % | | | 8.5 | % | | | 10.6 | % | | | 11.2 | % |
| Tier 1 leverage ratio | | | 9.4 | % | | | 9.0 | % | | | 10.4 | % | | | 11.0 | % | | | 10.9 | % |
| Tier 1 risk-based capital ratio | | | 14.3 | % | | | 14.3 | % | | | 15.2 | % | | | 17.2 | % | | | 18.0 | % |
| Total risk-based capital ratio | | | 15.4 | % | | | 15.3 | % | | | 16.3 | % | | | 18.4 | % | | | 19.2 | % |
| | | | | | | | | | | | | | | | | | | | |
| Other Information | | | | | | | | | | | | | | | | | | | | |
| Full-time equivalent employees | | | 412 | | | | 401 | | | | 355 | | | | 321 | | | | 316 | |
| Banking | | | 308 | | | | 316 | | | | 285 | | | | 264 | | | | 270 | |
| Mortgage | | | 97 | | | | 79 | | | | 64 | | | | 50 | | | | 39 | |
| Investments | | | 7 | | | | 6 | | | | 6 | | | | 7 | | | | 7 | |
| Number of full-service offices | | | 27 | | | | 29 | | | | 29 | | | | 20 | | | | 23 | |
| Mortgage loan offices | | | 12 | | | | 12 | | | | 12 | | | | 13 | | | | 11 | |
| Investment offices | | | 4 | | | | 4 | | | | 4 | | | | 4 | | | | 4 | |
Heritage Financial Group, Inc. and Subsidiary
Consolidated Financial Highlights
(Unaudited)
(Dollars in thousands)
| | | Five Quarter Comparison | |
Loans | | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| Construction and land | | $ | 48,808 | | | $ | 42,753 | | �� | $ | 37,659 | | | $ | 33,340 | | | $ | 30,010 | |
| Farmland | | | 22,561 | | | | 23,447 | | | | 20,749 | | | | 20,141 | | | | 20,298 | |
| Permanent 1 - 4 | | | 169,105 | | | | 166,199 | | | | 163,302 | | | | 161,883 | | | | 157,551 | |
| Permanent 1 - 4 - junior liens and revolving | | | 30,180 | | | | 29,432 | | | | 28,852 | | | | 27,345 | | | | 25,507 | |
| Multifamily | | | 27,468 | | | | 26,301 | | | | 24,280 | | | | 21,293 | | | | 19,805 | |
| Nonresidential | | | 250,859 | | | | 234,259 | | | | 225,946 | | | | 212,570 | | | | 193,392 | |
| Commercial business | | | 95,108 | | | | 88,828 | | | | 83,015 | | | | 83,659 | | | | 68,800 | |
| Consumer and other | | | 21,499 | | | | 26,889 | | | | 19,931 | | | | 25,498 | | | | 26,521 | |
| Total core loans | | $ | 665,588 | | | $ | 638,108 | | | $ | 603,734 | | | $ | 585,729 | | | $ | 541,884 | |
| | | | | | | | | | | | | | | | | | | | |
| FDIC-acquired non-covered | | | 69,661 | | | | 74,637 | | | | 83,317 | | | | 11,850 | | | | 14,291 | |
| Total loans | | | 735,249 | | | | 712,745 | | | | 687,051 | | | | 597,579 | | | | 556,175 | |
| | | | | | | | | | | | | | | | | | | | |
| FDIC-acquired covered | | | 53,843 | | | | 57,176 | | | | 65,815 | | | | 72,425 | | | | 78,757 | |
| | | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses | | | 8,894 | | | | 9,047 | | | | 9,105 | | | | 9,061 | | | | 8,530 | |
| | $ | 780,198 | | | $ | 760,874 | | | $ | 743,761 | | | $ | 660,943 | | | $ | 626,402 | |
Loan Balances by Geographical Region (excluding FDIC- acquired loans):
| | Five Quarter Comparison | |
| | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
| Albany, Georgia | | $ | 288,089 | | | $ | 282,509 | | | $ | 273,116 | | | $ | 282,151 | | | $ | 276,278 | |
| Valdosta, Georgia | | | 101,729 | | | | 96,485 | | | | 90,385 | | | | 84,198 | | | | 78,193 | |
| Ocala, Florida | | | 58,115 | | | | 58,240 | | | | 58,533 | | | | 55,197 | | | | 56,101 | |
| Statesboro, Georgia | | | 124,667 | | | | 118,056 | | | | 107,650 | | | | 103,176 | | | | 95,299 | |
| Auburn, Alabama | | | 31,485 | | | | 26,061 | | | | 24,386 | | | | 20,149 | | | | 12,500 | |
| Macon, Georgia | | | 60,197 | | | | 55,935 | | | | 49,165 | | | | 40,858 | | | | 23,513 | |
| Birmingham, Alabama | | | 344 | | | | 822 | | | | 499 | | | | - | | | | - | |
| South Atlanta, Georgia | | | 962 | | | | - | | | | - | | | | - | | | | - | |
| | $ | 665,588 | | | $ | 638,108 | | | $ | 603,734 | | | $ | 585,729 | | | $ | 541,884 | |
Asset Quality Data (excluding FDIC -acquired loans):
| | Five Quarter Comparison | |
| | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| Nonaccrual loans | | $ | 10,986 | | | $ | 12,223 | | | $ | 12,723 | | | $ | 14,677 | | | $ | 16,358 | |
| Loans - 90 days past due & still accruing | | | - | | | | - | | | | - | | | | - | | | | - | |
| Total non-performing loans | | | 10,986 | | | | 12,223 | | | | 12,723 | | | | 14,677 | | | | 16,358 | |
| | | | | | | | | | | | | | | | | | | | |
| OREO | | | 2,654 | | | | 3,046 | | | | 3,028 | | | | 2,620 | | | | 1,403 | |
| Total non-performing assets | | $ | 13,640 | | | $ | 15,269 | | | $ | 15,751 | | | $ | 17,297 | | | $ | 17,761 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Trouble debt restructuring - nonaccrual | | $ | 5,840 | | | $ | 6,496 | | | $ | 4,593 | | | $ | 6,856 | | | $ | 8,981 | |
| Trouble debt restructuring - accruing | | | 1,996 | | | | 2,009 | | | | 2,023 | | | | 7 | | | | 8 | |
| Total trouble debt restructuring | | $ | 7,836 | | | $ | 8,505 | | | $ | 6,616 | | | $ | 6,863 | | | $ | 8,989 | |
| | | | | | | | | | | | | | | | | | | | |
| Accruing past due loans | | $ | 669 | | | $ | 934 | | | $ | 1,316 | | | $ | 2,131 | | | $ | 1,038 | |
| | | | | | | | | | | | | | | | | | | | |
| Total criticized assets | | | 26,116 | | | | 25,785 | | | | 25,474 | | | | 28,194 | | | | 29,342 | |
| Total classified assets | | | 23,048 | | | | 22,985 | | | | 22,118 | | | | 25,129 | | | | 26,754 | |
| | | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses | | | 8,894 | | | | 9,047 | | | | 9,105 | | | | 9,061 | | | | 8,530 | |
| Net charge-offs | | $ | 503 | | | $ | 698 | | | $ | 406 | | | $ | 68 | | | $ | 320 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Asset Quality Ratios: | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses to total core loans | | | 1.34 | % | | | 1.42 | % | | | 1.51 | % | | | 1.55 | % | | | 1.57 | % |
| Allowance for loan losses to average core loans | | | 1.37 | % | | | 1.45 | % | | | 1.53 | % | | | 1.62 | % | | | 1.61 | % |
| Allowance for loan losses to non-performing loans | | | 80.96 | % | | | 74.02 | % | | | 71.56 | % | | | 61.73 | % | | | 52.15 | % |
| Non-performing loans to total core loans | | | 1.65 | % | | | 1.92 | % | | | 2.11 | % | | | 2.51 | % | | | 3.02 | % |
| Non-performing assets to total assets | | | 1.03 | % | | | 1.14 | % | | | 1.15 | % | | | 1.58 | % | | | 1.68 | % |
| Net charge-offs to average core loans (annualized) | | | 0.31 | % | | | 0.45 | % | | | 0.27 | % | | | 0.05 | % | | | 0.24 | % |
Heritage Financial Group, Inc. and Subsidiary
Consolidated Financial Highlights
(Unaudited)
(Dollars in thousands)
| | Five Quarter Comparison | |
FDIC-acquired assets | | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
FDIC-acquired non-covered loans: | | | | | | | | | | | | | | | |
| Commercial real estate | | $ | 25,027 | | | $ | 27,258 | | | $ | 30,851 | | | $ | 6,359 | | | $ | 7,321 | |
| Residential real estate | | | 32,318 | | | | 33,452 | | | | 34,938 | | | | 2,110 | | | | 2,328 | |
| Construction and land | | | 5,195 | | | | 5,941 | | | | 7,756 | | | | 494 | | | | 550 | |
| Commercial and industrial | | | 3,638 | | | | 4,106 | | | | 5,125 | | | | 1,574 | | | | 2,270 | |
| Consumer and other | | | 3,483 | | | | 3,880 | | | | 4,647 | | | | 1,313 | | | | 1,822 | |
| Total | | | 69,661 | | | | 74,637 | | | | 83,317 | | | | 11,850 | | | | 14,291 | |
FDIC-acquired covered loans: | | | | | | | | | | | | | | | | | | | | |
| Commercial real estate | | | 14,956 | | | | 15,384 | | | | 18,849 | | | | 21,820 | | | | 23,565 | |
| Residential real estate | | | 25,082 | | | | 27,283 | | | | 30,735 | | | | 32,846 | | | | 35,399 | |
| Construction and land | | | 12,469 | | | | 12,645 | | | | 13,370 | | | | 14,248 | | | | 14,293 | |
| Commercial and industrial | | | 924 | | | | 1,340 | | | | 2,216 | | | | 2,670 | | | | 4,252 | |
| Consumer and other | | | 412 | | | | 524 | | | | 645 | | | | 841 | | | | 1,248 | |
| Total | | | 53,843 | | | | 57,176 | | | | 65,815 | | | | 72,425 | | | | 78,757 | |
| Total carrying value of FDIC-acquired loans | | $ | 123,504 | | | $ | 131,813 | | | $ | 149,132 | | | $ | 84,275 | | | $ | 93,048 | |
| Non-accrete discount for FDIC-acquired loans | | | 48,545 | | | | 55,170 | | | | 59,558 | | | | 46,000 | | | | 54,204 | |
| Accretable discount for FDIC-acquired loans | | | 23,445 | | | | 23,007 | | | | 26,136 | | | | 21,834 | | | | 24,396 | |
| Total discount for FDIC-acquired loans | | | 71,990 | | | | 78,177 | | | | 85,694 | | | | 67,834 | | | | 78,600 | |
| Outstanding principal balance for FDIC-acquired loans | | $ | 195,494 | | | $ | 209,989 | | | $ | 234,826 | | | $ | 152,109 | | | $ | 171,648 | |
| | | | | | | | | | | | | | | | | | | | |
FDIC-acquired OREO: | | | | | | | | | | | | | | | | | | | | |
| Non-covered | | $ | 1,680 | | | $ | 1,087 | | | $ | 1,363 | | | $ | 602 | | | $ | 598 | |
| Covered | | | 5,909 | | | | 7,815 | | | | 9,460 | | | | 9,467 | | | | 9,457 | |
| Total carrying value of FDIC-acquired OREO | | $ | 7,589 | | | $ | 8,902 | | | $ | 10,823 | | | $ | 10,069 | | | $ | 10,055 | |
| Total discount for FDIC-acquired OREO | | | 12,038 | | | | 11,013 | | | | 12,176 | | | | 11,690 | | | | 12,404 | |
| Gross carrying value of FDIC-acquired OREO | | $ | 19,627 | | | $ | 19,915 | | | $ | 22,999 | | | $ | 21,759 | | | $ | 22,459 | |
| | | | | | | | | | | | | | | | | | | | |
Total loan discount accretion recognized in income: | | | | | | | | | | | | | | | | | | | | |
| Individual assessed discount accretion | | $ | 791 | | | $ | 2,336 | | | $ | 637 | | | $ | 2,515 | | | $ | 1,557 | |
| Pooled assessed discount accretion | | | 2,927 | | | | 3,808 | | | | 3,951 | | | | 4,131 | | | | 3,221 | |
| Total loan discount accretion recognized in income | | $ | 3,718 | | | $ | 6,144 | | | $ | 4,588 | | | $ | 6,646 | | | $ | 4,778 | |
| | | | | | | | | | | | | | | | | | | | |
FDIC-acquired ratios: | | | | | | | | | | | | | | | | | | | | |
| Total discount to principal balance for FDIC-acquired loans | | | 36.8 | % | | | 37.2 | % | | | 36.5 | % | | | 44.6 | % | | | 45.8 | % |
| | Five Quarter Comparison | |
Non-covered FDIC-acquired assets | | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
Outstanding principal balance: | | | | | | | | | | | | | | | |
| FDIC-acquired non-covered loan pools | | $ | 66,294 | | | $ | 70,144 | | | $ | 76,675 | | | $ | 14,196 | | | $ | 16,685 | |
| FDIC-acquired non-covered loans individually assessed | | | 27,627 | | | | 31,603 | | | | 35,837 | | | | 2,903 | | | | 3,048 | |
| Total non-covered outstanding principal loan balance | | | 93,921 | | | | 101,747 | | | | 112,512 | | | | 17,099 | | | | 19,733 | |
| Gross carrying value for FDIC-acquired non-covered OREO | | | 4,993 | | | | 2,529 | | | | 2,371 | | | | 793 | | | | 789 | |
| Total gross balance of non-covered assets | | $ | 98,914 | | | $ | 104,276 | | | $ | 114,883 | | | $ | 17,892 | | | $ | 20,522 | |
Non-covered non-accretable discount for estimated credit losses: | | | | | | | | | | | | | | | | | | | | |
| FDIC-acquired non-covered loan pools | | $ | 9,297 | | | | 9,341 | | | | 9,479 | | | | 1,775 | | | | 1,891 | |
| FDIC-acquired non-covered loans individually assessed | | | 12,294 | | | | 14,894 | | | | 16,482 | | | | 2,130 | | | | 2,218 | |
| Total non-covered non-accretable discount | | | 21,591 | | | | 24,235 | | | | 25,961 | | | | 3,905 | | | | 4,109 | |
| FDIC-acquired non-covered OREO discount | | | 3,313 | | | | 1,442 | | | | 1,008 | | | | 191 | | | | 191 | |
| Total non-covered discount for estimated credit losses | | | 24,904 | | | | 25,677 | | | | 26,969 | | | | 4,096 | | | | 4,300 | |
Non-covered accretable discount: | | | | | | | | | | | | | | | | | | | | |
| Non-covered accretable discount for improvement in cash flows | | | 380 | | | | 318 | | | | 475 | | | | 381 | | | | 723 | |
| Other non-covered accretable discount | | | 2,288 | | | | 2,558 | | | | 2,759 | | | | 963 | | | | 610 | |
| Total non-covered accretable discount | | | 2,668 | | | | 2,876 | | | | 3,234 | | | | 1,344 | | | | 1,333 | |
| Total non-covered discount | | $ | 27,572 | | | $ | 28,553 | | | $ | 30,203 | | | $ | 5,440 | | | $ | 5,633 | |
| | | | | | | | | | | | | | | | | | | | |
Non-covered loan discount accretion recognized in income: | | | | | | | | | | | | | | | | | | | | |
| Individual assessed discount accretion | | $ | 619 | | | $ | 974 | | | $ | 42 | | | $ | 29 | | | $ | 15 | |
| Pooled assessed discount accretion | | | 184 | | | | 174 | | | | 24 | | | | 39 | | | | 40 | |
| Total non-covered discount accretion recognized in income | | $ | 803 | | | $ | 1,148 | | | $ | 66 | | | $ | 68 | | | $ | 55 | |
| | | | | | | | | | | | | | | | | | | | |
Non-covered FDIC-acquired ratios: | | | | | | | | | | | | | | | | | | | | |
| Total discount to principal balance for non-covered FDIC-acquired assets | | | 27.9 | % | | | 27.4 | % | | | 26.3 | % | | | 30.4 | % | | | 27.4 | % |
| Gross balance of non-covered loans to total FDIC-acquired loans | | | 48.0 | % | | | 48.5 | % | | | 47.9 | % | | | 11.2 | % | | | 11.5 | % |
| | | Five Quarter Comparison | |
Covered FDIC-acquired assets | | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
Outstanding principal balance: | | | | | | | | | | | | | | | |
| FDIC-acquired covered loan pools | | $ | 74,020 | | | $ | 79,552 | | | $ | 90,020 | | | $ | 98,570 | | | $ | 105,001 | |
| FDIC-acquired covered loans individually assessed | | | 27,554 | | | | 28,690 | | | | 32,294 | | | | 36,440 | | | | 46,914 | |
| Total covered outstanding principal loan balance | | | 101,574 | | | | 108,242 | | | | 122,314 | | | | 135,010 | | | | 151,915 | |
| Gross carrying value for FDIC-acquired OREO covered | | | 14,634 | | | | 17,385 | | | | 20,628 | | | | 20,966 | | | | 21,670 | |
| Total gross balance of covered assets | | $ | 116,208 | | | $ | 125,627 | | | $ | 142,942 | | | $ | 155,976 | | | $ | 173,585 | |
Covered non-accretable discount for estimated credit losses: | | | | | | | | | | | | | | | | | | | | |
| FDIC-acquired covered loan pools | | $ | 16,281 | | | $ | 19,917 | | | $ | 20,705 | | | $ | 27,194 | | | $ | 28,618 | |
| FDIC-acquired covered loans individually assessed | | | 10,673 | | | | 11,018 | | | | 12,892 | | | | 14,900 | | | | 21,477 | |
| Total covered non-accretable discount | | | 26,954 | | | | 30,935 | | | | 33,597 | | | | 42,094 | | | | 50,095 | |
| FDIC-acquired covered OREO discount | | | 8,725 | | | | 9,570 | | | | 11,168 | | | | 11,499 | | | | 12,213 | |
| Total covered discount for estimated credit losses | | | 35,679 | | | | 40,505 | | | | 44,765 | | | | 53,593 | | | | 62,308 | |
Covered accretable discount: | | | | | | | | | | | | | | | | | | | | |
| Covered accretable discount for improvement in cash flows | | | 17,676 | | | | 16,297 | | | | 18,820 | | | | 15,396 | | | | 19,988 | |
| Other covered accretable discount | | | 3,101 | | | | 3,834 | | | | 4,082 | | | | 5,095 | | | | 3,075 | |
| Total covered accretable discount | | | 20,777 | | | | 20,131 | | | | 22,902 | | | | 20,491 | | | | 23,063 | |
| Total covered discount | | $ | 56,456 | | | $ | 60,636 | | | $ | 67,667 | | | $ | 74,084 | | | $ | 85,371 | |
| | | | | | | | | | | | | | | | | | | | |
Covered loan discount accretion recognized in income: | | | | | | | | | | | | | | | | | | | | |
| Individual assessed accretion | | $ | 172 | | | $ | 1,362 | | | $ | 595 | | | $ | 2,486 | | | $ | 1,542 | |
| Pooled assessed accretion | | | 2,743 | | | | 3,634 | | | | 3,927 | | | | 4,092 | | | | 3,181 | |
| Total covered discount accretion recognized in income | | $ | 2,915 | | | $ | 4,996 | | | $ | 4,522 | | | $ | 6,578 | | | $ | 4,723 | |
| | | | | | | | | | | | | | | | | | | | |
Covered FDIC-acquired ratios: | | | | | | | | | | | | | | | | | | | | |
| Total discount to principal balance for covered FDIC-acquired assets | | | 48.6 | % | | | 48.3 | % | | | 47.3 | % | | | 47.5 | % | | | 49.2 | % |
| | | Five Quarter Comparison | |
FDIC loss-share receivable | | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
FDIC loss-share receivable: | | | | | | | | | | | | | | | |
| Single family estimated credit losses | | $ | 9,134 | | | $ | 9,764 | | | $ | 10,720 | | | $ | 11,292 | | | $ | 12,297 | |
| Non-single family estimated credit losses | | | 33,550 | | | | 35,678 | | | | 40,148 | | | | 43,899 | | | | 53,540 | |
| Pending reimbursements and other | | | 1,843 | | | | 2,664 | | | | 1,144 | | | | 5,540 | | | | 1,861 | |
| Total | | $ | 44,527 | | | $ | 48,106 | | | $ | 52,012 | | | $ | 60,731 | | | $ | 67,698 | |
| | | | | | | | | | | | | | | | | | | | |
| FDIC loss-share clawback liability | | $ | 1,681 | | | $ | 1,393 | | | $ | 1,269 | | | $ | 703 | | | $ | 484 | |
| | | | | | | | | | | | | | | | | | | | |
| Total covered discount | | $ | 56,456 | | | $ | 60,636 | | | $ | 67,667 | | | $ | 74,084 | | | $ | 85,371 | |
| Total covered discount impacting FDIC loss-share receivable | | $ | 53,355 | | | $ | 56,802 | | | $ | 63,585 | | | $ | 68,989 | | | $ | 82,296 | |
| Total covered discount impacting FDIC loss-share receivable at 80% | | $ | 42,684 | | | $ | 45,442 | | | $ | 50,868 | | | $ | 55,191 | | | $ | 65,837 | |
| | | | | | | | | | | | | | | | | | | | |
FDIC loss-share receivable ratios: | | | | | | | | | | | | | | | | | | | | |
| FDIC receivable as % of gross balance of covered assets | | | 38.3 | % | | | 38.3 | % | | | 36.4 | % | | | 38.9 | % | | | 39.0 | % |
| Covered discount at 80% as of % of FDIC receivable | | | 95.9 | % | | | 94.5 | % | | | 97.8 | % | | | 90.9 | % | | | 97.3 | % |
Heritage Financial Group, Inc. and Subsidiary
Consolidated Financial Highlights
(Unaudited)
Mortgage Segment Information
| | Five Quarter Comparison | |
| | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
| Net interest income | | $ | 218 | | | $ | 112 | | | $ | 19 | | | $ | 156 | | | $ | 678 | |
| Provision for loan losses | | | - | | | | - | | | | - | | | | - | | | | - | |
| Noninterest income | | | 1,952 | | | | 3,424 | | | | 2,182 | | | | 1,452 | | | | 1,683 | |
| Noninterest expense | | | 2,968 | | | | 3,239 | | | | 2,206 | | | | 1,732 | | | | 1,323 | |
| Income tax expense (benefit) | | | (247 | ) | | | 92 | | | | (2 | ) | | | (38 | ) | | | 322 | |
| Mortgage profit (loss) | | $ | (551 | ) | | $ | 205 | | | $ | (3 | ) | | $ | (86 | ) | | $ | 716 | |
| | | | | | | | | | | | | | | | | | | | |
| Mortgage segment assets | | $ | 44,588 | | | $ | 46,854 | | | $ | 20,849 | | | $ | 16,382 | | | $ | 7,339 | |
Mortgage Segment Selected Other Information:
| | Five Quarter Comparison | |
| | 9/30/2013 | | | 6/30/2013 | | | 3/31/2013 | | | 12/31/2012 | | | 9/30/2012 | |
| | | | | | | | | | | | | | | |
| Retail production | | $ | 83,657 | | | $ | 97,608 | | | $ | 49,450 | | | $ | 55,815 | | | $ | 43,484 | |
| Wholesale production | | $ | 31,646 | | | $ | 19,072 | | | $ | 5,588 | | | $ | - | | | $ | - | |
| Purchase as a % of total production | | | 76 | % | | | 66 | % | | | 54 | % | | | 42 | % | | | 53 | % |
| Refi as a % of total production | | | 24 | % | | | 34 | % | | | 46 | % | | | 58 | % | | | 47 | % |
| End of period Locks | | $ | 47,871 | | | $ | 53,910 | | | $ | 49,964 | | | $ | 20,271 | | | $ | 8,132 | |
