FB Financial (FBK) 8-K FB Financial Corporation Reports 2018 Fourth Quarter and Annual Results

Exhibit 99.2

Fourth Quarter 2018

Financial Supplement

TABLE OF CONTENTS

	Page
Financial Summary and Key Metrics	4
Consolidated Statements of Income	5
Consolidated Balance Sheets	7
Average Balance, Average Yield Earned and Average Rate Paid	8
Loans and Deposits by Market	11
Segment Data	12
Loan Portfolio and Asset Quality	13
Preliminary Capital Ratios	15
Investment Portfolio	16
Non-GAAP Reconciliation	17

Use of non-GAAP Financial Measures

This Supplemental Financial Information contains certain financial measures that are not measures recognized under U.S. generally accepted accounting principles (“GAAP”) and therefore are considered non-GAAP financial measures. These non-GAAP financial measures include, without limitation, adjusted net income, adjusted diluted earnings per share, core noninterest expense and core noninterest income, core efficiency ratio (tax equivalent basis), Banking segment core efficiency ratio (tax equivalent basis), Mortgage segment core efficiency ratio (tax equivalent basis), adjusted mortgage contribution, adjusted return on average assets and equity, pro forma return on average assets and equity, adjusted pro forma return on average assets and equity and core total revenue.  Each of these non-GAAP metrics excludes certain income and expense items that the Company’s management considers to be non-core/adjusted in nature. The Company refers to these non-GAAP measures as adjusted measures. The corresponding Earnings Release and Earnings Release Presentation also presents tangible assets, tangible common equity, tangible book value per common share, tangible common equity to tangible assets, return on tangible common equity, return on average tangible common equity, pro forma return on average tangible common equity, adjusted return on average tangible common equity and pro forma adjusted return on average tangible common equity.  Each of these non-GAAP metrics excludes the impact of goodwill and other intangibles.

The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance, financial condition and the efficiency of its operations as management believes such measures facilitate period-to-period comparisons and provide meaningful indications of its operating performance as they eliminate both gains and charges that management views as non-recurring or not indicative of operating performance. Management believes that these non-GAAP financial measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods as well as demonstrating the effects of significant non-core gains and charges in the current and prior periods. The Company’s management also believes that investors find these non-GAAP financial measures useful as they assist investors in understanding the Company’s underlying operating performance and in the analysis of ongoing operating trends.  In addition, because intangible assets such as goodwill and other intangibles, and the other items excluded each vary extensively from company to company, the Company believes that the presentation of this information allows investors to more easily compare the Company’s results to the results of other companies.  However, the non-GAAP financial measures discussed herein should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which the Company calculates the non-GAAP financial measures discussed herein may differ from that of other companies reporting measures with similar names. You should understand how such other banking organizations calculate their financial measures similar or with names similar to the non-GAAP financial measures the Company has discussed herein when comparing such non-GAAP financial measures.  The Company includes tables under the Non-GAAP reconciliation section of this document to provide a reconciliation of these measures to the most directly comparable GAAP financial measures.

Financial Summary and Key Metrics
(Unaudited)
(In Thousands, Except Share Data and %)
	2018												2017
	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Statement of Income Data
Total interest income	$	63,068		$	62,612		$	59,043		$	54,848		$	55,031
Total interest expense		11,701			9,857			7,526			6,419			6,048
Net interest income		51,367			52,755			51,517			48,429			48,983
Provision for loan losses		2,200			1,818			1,063			317			956
Total noninterest income		27,249			34,355			35,763			33,275			37,017
Total noninterest expense		53,736			57,213			56,358			56,151			57,540
Net income before income taxes		22,680			28,079			29,859			25,236			27,504
Income tax expense		5,640			6,702			7,794			5,482			4,486
Net income	$	17,040		$	21,377		$	22,065		$	19,754		$	23,018
Net interest income (tax—equivalent basis)	$	51,799		$	53,161		$	51,909		$	48,799		$	49,692
Net income, adjusted*	$	17,336		$	21,377		$	22,736		$	20,636		$	18,265
Per Common Share
Diluted net income	$	0.54		$	0.68		$	0.70		$	0.63		$	0.74
Diluted net income, adjusted*		0.55			0.68			0.72			0.66			0.59
Book value		21.87			21.12			20.56			19.92			19.54
Tangible book value*		17.02			16.25			15.66			14.99			14.56
Weighted average number of shares-diluted		31,344,949			31,339,628			31,294,044			31,421,830			31,166,080
Period-end number of shares		30,724,532			30,715,792			30,683,353			30,671,763			30,535,517
Selected Balance Sheet Data
Cash and cash equivalents	$	125,356		$	181,630		$	104,417		$	73,700		$	119,751
Loans held for investment (HFI)		3,667,511			3,538,531			3,415,575			3,244,663			3,166,911
Allowance for loan losses		(28,932	)		(27,608	)		(26,347	)		(24,406	)		(24,041	)
Loans held for sale		278,815			323,486			374,916			414,518			526,185
Investment securities, at fair value		658,805			609,568			611,435			597,347			543,992
Other real estate owned, net		12,643			13,587			14,639			15,334			16,442
Total assets		5,136,764			5,058,167			4,923,249			4,725,416			4,727,713
Customer deposits		4,068,610			4,017,391			3,844,009			3,684,758			3,578,694
Brokered and internet time deposits		103,107			112,082			65,854			81,393			85,701
Total deposits		4,171,717			4,129,473			3,909,863			3,766,151			3,664,395
Borrowings		227,776			210,968			342,893			293,017			347,595
Total shareholders' equity		671,857			648,731			630,959			611,075			596,729
Selected Ratios
Return on average:
Assets		1.35	%		1.72	%		1.86	%		1.71	%		1.96	%
Shareholders' equity		10.3	%		13.3	%		14.4	%		13.4	%		15.8	%
Tangible common equity*		13.3	%		17.4	%		19.0	%		17.9	%		21.3	%
Average shareholders' equity to average assets		13.2	%		12.9	%		12.9	%		12.8	%		12.4	%
Net interest margin (NIM) (tax-equivalent basis)		4.50	%		4.71	%		4.81	%		4.64	%		4.63	%
Efficiency ratio (GAAP)		68.4	%		65.7	%		64.6	%		68.7	%		66.9	%
Core efficiency ratio (tax-equivalent basis)*		65.4	%		63.7	%		62.1	%		65.5	%		63.6	%
Loans HFI to deposit ratio		87.9	%		85.7	%		87.4	%		86.2	%		86.4	%
Total loans to deposit ratio		94.6	%		93.5	%		96.9	%		97.2	%		100.8	%
Yield on interest-earning assets		5.52	%		5.58	%		5.51	%		5.25	%		5.20	%
Cost of interest-bearing liabilities		1.40	%		1.20	%		0.96	%		0.85	%		0.79	%
Cost of total deposits		1.03	%		0.80	%		0.62	%		0.55	%		0.50	%
Credit Quality Ratios
Allowance for loan losses as a percentage of loans HFI		0.79	%		0.78	%		0.77	%		0.75	%		0.76	%
Net charge-off's (recoveries) as a percentage of average loans HFI		0.06	%		0.06	%		(0.11	)%		(0.01	)%		0.05	%
Nonperforming loans HFI as a percentage of total loans HFI		0.46	%		0.30	%		0.26	%		0.30	%		0.32	%
Nonperforming assets as a percentage of total assets (a)		0.61	%		0.51	%		0.52	%		0.59	%		1.52	%
Preliminary capital ratios (Consolidated)
Shareholders' equity to assets		13.1	%		12.8	%		12.8	%		12.9	%		12.6	%
Tangible common equity to tangible assets*		10.5	%		10.2	%		10.1	%		10.1	%		9.7	%
Tier 1 capital (to average assets)		11.5	%		11.3	%		10.9	%		10.7	%		10.5	%
Tier 1 capital (to risk-weighted assets)		12.4	%		12.2	%		11.3	%		11.8	%		11.4	%
Total capital (to risk-weighted assets)		13.0	%		12.8	%		11.9	%		12.3	%		12.0	%
Common Equity Tier 1 (to risk-weighted assets) (CET1)		11.7	%		11.5	%		10.6	%		11.0	%		10.7	%

*These measures are considered non-GAAP financial measures. See "GAAP Reconciliation and Use of Non-GAAP Financial Measures" and the corresponding financial tables below for reconciliations of these Non-GAAP measures. Investors are encouraged to refer to the discussion of non-GAAP measures included in the corresponding earnings release.

(a) For the three months ended December 31, 2017, GNMA loans subject to ability to repurchase were included in nonperforming assets. The Company derecognized these in the first quarter of 2018 as the perceived benefit has decreased with rising rates.

FB Financial Corporation 4

Consolidated Statements of Income
(Unaudited)
(In Thousands, Except Share Data and %)
																	Q4 2018			Q4 2018
																	vs.			vs.
	2018													2017			Q3 2018			Q4 2017
	Fourth Quarter			Third Quarter				Second Quarter			First Quarter			Fourth Quarter			Percent variance			Percent variance
Interest income:
Interest and fees on loans	$	57,875		$	57,904			$	54,529		$	50,693		$	51,246			(0.1	)%		12.9	%
Interest on securities
Taxable		3,260			3,151				3,134			2,852			2,529			3.5	%		28.9	%
Tax-exempt		1,110			1,031				981			925			910			7.7	%		22.0	%
Other		823			526				399			378			346			56.5	%		137.9	%
Total interest income		63,068			62,612				59,043			54,848			55,031			0.7	%		14.6	%
Interest expense:
Deposits		10,703			7,864				5,898			5,071			4,656			36.1	%		129.9	%
Borrowings		998			1,993				1,628			1,348			1,392			(49.9	)%		(28.3	)%
Total interest expense		11,701			9,857				7,526			6,419			6,048			18.7	%		93.5	%
Net interest income		51,367			52,755				51,517			48,429			48,983			(2.6	)%		4.9	%
Provision for loan losses		2,200			1,818				1,063			317			956			21.0	%		130.1	%
Net interest income afterprovision for loan losses		49,167			50,937				50,454			48,112			48,027			(3.5	)%		2.4	%
Noninterest income:
Mortgage banking income		18,997			26,649				28,544			26,471			30,280			(28.7	)%		(37.3	)%
Service charges on deposit accounts		2,286			2,208				2,049			1,959			2,102			3.5	%		8.8	%
ATM and interchange fees		2,660			2,411				2,581			2,361			2,430			10.3	%		9.5	%
Investment services and trust income		1,384			1,411				1,180			1,206			1,154			(1.9	)%		19.9	%
(Loss) gain from securities, net		—			(27	)			(42	)		(47	)		1			(100.0	)%		(100.0	)%
(Loss) gain on sales or write-downs ofother real estate owned		(56	)		120				23			(186	)		(72	)		(146.7	)%		(22.2	)%
Gain (loss) from other assets		89			326				(155	)		68			(314	)		(72.7	)%		(128.3	)%
Other income		1,889			1,257				1,583			1,443			1,436			50.3	%		31.5	%
Total noninterest income		27,249			34,355				35,763			33,275			37,017			(20.7	)%		(26.4	)%
Total revenue		78,616			87,110				87,280			81,704			86,000			(9.8	)%		(8.6	)%
Noninterest expenses:
Salaries, commissions and employee benefits		33,286			35,213				34,366			34,027			35,659			(5.5	)%		(6.7	)%
Occupancy and equipment expense		3,493			3,514				3,545			3,424			3,660			(0.6	)%		(4.6	)%
Legal and professional fees		1,978			1,917				1,965			2,043			1,764			3.2	%		12.1	%
Data processing		2,365			2,562				2,138			2,035			1,766			(7.7	)%		33.9	%
Merger and conversion		401			—				—			1,193			2,069			—	%		(80.6	)%
Amortization of core deposits and other intangibles		753			777				802			853			922			(3.1	)%		(18.3	)%
Regulatory fees and deposit insurance assessments		684			738				730			562			571			(7.3	)%		19.8	%
Software license and maintenance fees		489			622				603			657			768			(21.4	)%		(36.3	)%
Advertising		2,639			3,810				3,408			3,282			3,189			(30.7	)%		(17.2	)%
Other expense		7,648			8,060				8,801			8,075			7,172			(5.1	)%		6.6	%
Total noninterest expense		53,736			57,213				56,358			56,151			57,540			(6.1	)%		(6.6	)%
Income before income taxes		22,680			28,079				29,859			25,236			27,504			(19.2	)%		(17.5	)%
Income tax expense		5,640			6,702				7,794			5,482			4,486			(15.8	)%		25.7	%
Net income	$	17,040		$	21,377			$	22,065		$	19,754		$	23,018			(20.3	)%		(26.0	)%
Earnings available to common shareholders(a)	$	16,949		$	21,263			$	21,948		$	19,754		$	23,018
Weighted average common shares outstanding:
Basic		30,717,008			30,692,668				30,678,732			30,613,284			30,527,234
Fully diluted		31,344,949			31,339,628				31,294,044			31,421,830			31,166,080
Earnings per common share:
Basic	$	0.55		$	0.69			$	0.72		$	0.65			0.75
Fully diluted		0.54			0.68		��		0.70			0.63			0.74

(a) Beginning with the second quarter of 2018, the Company declared a dividend which included participating securities related to the Company's undistributed restricted stock units. As such, earnings per share is presented in accordance with the two-class method.

FB Financial Corporation 5

Consolidated Statements of Income
(Unaudited)
(In Thousands, Except Share Data and %)
							YTD 2018
	For the year ended						vs.
	December 31,						YTD 2017
	2018			2017			Percent variance
Interest income:
Interest and fees on loans	$	221,001		$	153,969			43.5	%
Interest on securities
Taxable		12,397			10,084			22.9	%
Tax-exempt		4,047			4,006			1.0	%
Other		2,126			1,554			36.8	%
Total interest income		239,571			169,613			41.2	%
Interest expense:
Deposits		29,536			13,031			126.7	%
Borrowings		5,967			3,311			80.2	%
Total interest expense		35,503			16,342			117.3	%
Net interest income		204,068			153,271			33.1	%
Provision for loan losses		5,398			(950	)		(668.2	)%
Net interest income after provision for loan losses		198,670			154,221			28.8	%
Noninterest income:
Mortgage banking income		100,661			116,933			(13.9	)%
Service charges on deposit accounts		8,502			7,426			14.5	%
ATM and interchange fees		10,013			8,784			14.0	%
Investment services and trust income		5,181			3,949			31.2	%
(Loss) gain from securities, net		(116	)		285			(140.7	)%
(Loss) gain on sales or write-downs of other real estate owned		(99	)		774			(112.8	)%
Gain (loss) on other assets		328			(664	)		(149.4	)%
Other income		6,172			4,094			50.8	%
Total noninterest income		130,642			141,581			(7.7	)%
Total revenue		334,710			294,852			13.5	%
Noninterest expenses:
Salaries, commissions and employee benefits		136,892			130,005			5.3	%
Occupancy and equipment expense		13,976			13,010			7.4	%
Legal and professional fees		7,903			5,737			37.8	%
Data processing		9,100			6,488			40.3	%
Merger and conversion		1,594			19,034			(91.6	)%
Amortization of intangibles		3,185			1,995			59.6	%
Loss on sale of mortgage servicing rights		—			249			(100.0	)%
Regulatory fees and deposit insurance assessments		2,714			2,049			32.5	%
Software license and maintenance fees		2,371			2,758			(14.0	)%
Advertising		13,139			12,957			1.4	%
Other expense		32,584			28,035			16.2	%
Total noninterest expense		223,458			222,317			0.5	%
Net income before income taxes		105,854			73,485			44.0	%
Income tax expense		25,618			21,087			21.5	%
Net income	$	80,236		$	52,398			53.1	%
Earnings available to common shareholders(a)	$	79,808		$	52,398
Weighted average common shares outstanding:
Basic		30,675,755			27,627,228
Fully diluted		31,314,981			28,207,602
Earnings per common share:
Basic	$	2.60		$	1.90
Fully diluted		2.55			1.86

(a) During 2018, the Company declared dividends which included participating securities related to the Company's undistributed restricted stock units. As such, earnings per share is presented in accordance with the two-class method.

FB Financial Corporation 6

Consolidated Balance Sheets
(Unaudited)
(In Thousands, Except %)
															Annualized
															Q4 2018			Q4 2018
															vs.			vs.
	2018												2017		Q3 2018			Q4 2017
	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter		Percent variance			Percent variance
ASSETS
Cash and due from banks	$	38,381		$	81,366		$	67,863		$	53,060		$	29,831		(209.6	)%		28.7	%
Federal funds sold		31,364			801			19,859			7,171			66,127		15138.0	%		(52.6	)%
Interest bearing deposits in financial institutions		55,611			99,463			16,695			13,469			23,793		(174.9	)%		133.7	%
Cash and cash equivalents		125,356			181,630			104,417			73,700			119,751		(122.9	)%		4.7	%
Investments:
Available-for-sale debt securities, at fair value		655,698			606,501			608,360			594,248			536,270		32.2	%		22.3	%
Equity securities, at fair value		3,107			3,067			3,075			3,099			7,722		5.2	%		(59.8	)%
Federal Home Loan Bank stock, at cost		13,432			13,432			12,641			11,810			11,412		—	%		17.7	%
Loans held for sale, at fair value		278,815			323,486			374,916			414,518			526,185		(54.8	)%		(47.0	)%
Loans		3,667,511			3,538,531			3,415,575			3,244,663			3,166,911		14.5	%		15.8	%
Less: allowance for loan losses		28,932			27,608			26,347			24,406			24,041		19.0	%		20.3	%
Net loans		3,638,579			3,510,923			3,389,228			3,220,257			3,142,870		14.4	%		15.8	%
Premises and equipment, net		86,882			86,445			85,936			81,175			81,577		2.0	%		6.5	%
Other real estate owned, net		12,643			13,587			14,639			15,334			16,442		(27.6	)%		(23.1	)%
Interest receivable		14,503			14,943			12,729			13,920			13,069		(11.7	)%		11.0	%
Mortgage servicing rights, at fair value		88,829			79,890			109,449			93,160			76,107		44.4	%		16.7	%
Goodwill		137,190			137,190			137,190			137,190			137,190		—	%		—	%
Core deposit and other intangibles, net		11,628			12,403			13,203			14,027			14,902		(24.8	)%		(22.0	)%
Other assets		70,102			74,670			57,466			52,978			44,216		(24.3	)%		58.5	%
Total assets	$	5,136,764		$	5,058,167		$	4,923,249		$	4,725,416		$	4,727,713		6.2	%		8.7	%
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits
Noninterest-bearing	$	949,135		$	962,948		$	970,851		$	930,991		$	888,200		(5.7	)%		6.9	%
Interest-bearing checking		863,706			876,991			921,246			983,634			895,140		(6.0	)%		(3.5	)%
Money market and savings		1,239,131			1,236,851			1,287,657			1,144,517			1,192,726		0.7	%		3.9	%
Customer time deposits		1,016,638			940,601			664,255			625,616			602,628		32.1	%		68.7	%
Brokered and internet time deposits		103,107			112,082			65,854			81,393			85,701		(31.8	)%		20.3	%
Total deposits		4,171,717			4,129,473			3,909,863			3,766,151			3,664,395		4.1	%		13.8	%
Borrowings		227,776			210,968			342,893			293,017			347,595		31.6	%		(34.5	)%
Accrued expenses and other liabilities		65,414			68,995			39,534			55,173			118,994		(20.6	)%		(45.0	)%
Total liabilities		4,464,907			4,409,436			4,292,290			4,114,341			4,130,984		5.0	%		8.1	%
Shareholders' equity:										��
Common stock, $1 par value		30,725			30,716			30,683			30,672			30,536		0.1	%		0.6	%
Additional paid-in capital		424,146			422,302			420,382			418,810			418,596		1.7	%		1.3	%
Retained earnings		221,213			206,718			187,250			167,094			147,449		27.8	%		50.0	%
Accumulated other comprehensive (loss) income, net		(4,227	)		(11,005	)		(7,356	)		(5,501	)		148		(244.4	)%		(2956.1	)%
Total shareholders' equity		671,857			648,731			630,959			611,075			596,729		14.1	%		12.6	%
Total liabilities and shareholders' equity	$	5,136,764		$	5,058,167		$	4,923,249		$	4,725,416		$	4,727,713		6.2	%		8.7	%

FB Financial Corporation 7

Average Balance, Average Yield Earned and Average Rate Paid
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
	Three Months Ended								Three Months Ended
	December 31, 2018								September 30, 2018
	Averagebalances			Interestincome/expense		Averageyield/rate			Averagebalances			Interestincome/expense		Averageyield/rate
Interest-earning assets:
Loans HFI(1)	$	3,559,587		$	54,858		6.11	%	$	3,457,526		$	53,928		6.19	%
Loans held for sale		260,763			3,058		4.65	%		353,477			4,019		4.51	%
Securities:
Taxable		487,843			3,260		2.65	%		482,733			3,151		2.59	%
Tax-exempt(1)		130,465			1,501		4.56	%		121,680			1,394		4.55	%
Total securities(1)		618,308			4,761		3.05	%		604,413			4,545		2.98	%
Federal funds sold		27,835			160		2.28	%		18,014			97		2.14	%
Interest-bearing deposits with other financial institutions		86,421			464		2.13	%		33,184			214		2.56	%
FHLB stock		13,432			199		5.88	%		13,179			215		6.47	%
Total interest earning assets(1)		4,566,346			63,500		5.52	%		4,479,793			63,018		5.58	%
Noninterest Earning Assets:
Cash and due from banks		53,067								52,980
Allowance for loan losses		(27,369	)							(26,487	)
Other assets		413,114								425,911
Total noninterest earning assets		438,812								452,404
Total assets	$	5,005,158							$	4,932,197
Interest-bearing liabilities:
Interest bearing deposits:
Interest bearing checking	$	828,507		$	1,870		0.90	%	$	870,964		$	1,690		0.77	%
Money market		1,058,172			3,568		1.34	%		1,067,754			3,126		1.16	%
Savings deposits		174,199			67		0.15	%		177,698			68		0.15	%
Customer time deposits		983,204			4,649		1.88	%		745,616			2,699		1.44	%
Broker and internet time deposits		107,129			549		2.03	%		61,478			281		1.81	%
Time deposits		1,090,333			5,198		1.89	%		807,094			2,980		1.46	%
Total interest bearing deposits		3,151,211			10,703		1.35	%		2,923,510			7,864		1.07	%
Other interest-bearing liabilities:
Securities sold under agreements to repurchase andfederal funds purchased		18,378			29		0.63	%		24,484			51		0.83	%
Federal Home Loan Bank advances		106,468			554		2.06	%		293,020			1,524		2.06	%
Subordinated debt		30,930			415		5.32	%		30,930			418		5.36	%
Total other interest-bearing liabilities		155,776			998		2.54	%		348,434			1,993		2.27	%
Total Interest-bearing liabilities		3,306,987			11,701		1.40	%		3,271,944			9,857		1.20	%
Noninterest bearing liabilities:
Demand deposits		987,127								980,296
Other liabilities		51,994								41,569
Total noninterest-bearing liabilities		1,039,121								1,021,865
Total liabilities		4,346,108								4,293,809
Shareholders' equity		659,050								638,388
Total liabilities and shareholders' equity	$	5,005,158							$	4,932,197
Net interest income(1)				$	51,799							$	53,161
Interest rate spread(1)							4.11	%							4.39	%
Net interest margin(1)							4.50	%							4.71	%
Cost of total deposits							1.03	%							0.80	%
Average interest-earning assets to average interest-bearing liabilities							138.1	%							136.9	%
Tax equivalent adjustment				$	432							$	406
Loan HFI yield components:
Contractual interest rate(1)				$	49,873		5.56	%				$	47,650		5.47	%
Origination and other loan fee income					2,998		0.33	%					3,486		0.40	%
Accretion on purchased loans					1,863		0.21	%					2,130		0.25	%
Nonaccrual interest					96		0.01	%					630		0.07	%
Syndication fee income					28		—	%					32		—	%
Total loan yield				$	54,858		6.11	%				$	53,928		6.19	%

(1) Includes tax equivalent adjustment using combined marginal tax rate of 26.060% for 2018.

FB Financial Corporation 8

Average Balance, Average Yield Earned and Average Rate Paid
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
	Three Months Ended								Three Months Ended								Three Months Ended
	June 30, 2018								March 31, 2018								December 31, 2017
	Averagebalances			Interestincome/expense		Averageyield/rate			Averagebalances			Interestincome/expense		Averageyield/rate			Averagebalances			Interestincome/expense			Averageyield/rate
Interest-earning assets:
Loans HFI(1)	$	3,289,045		$	50,193		6.12	%	$	3,192,490		$	46,564		5.92	%	$	3,138,245		$	46,503			5.88	%
Loans held for sale		362,571			4,382		4.85	%		434,573			4,173		3.89	%		493,073			4,856			3.91	%
Securities:
Taxable		484,035			3,134		2.60	%		457,826			2,852		2.53	%		442,351			2,529	��		2.27	%
Tax-exempt(1)		115,334			1,327		4.61	%		109,116			1,251		4.65	%		108,000			1,506			5.53	%
Total securities(1)		599,369			4,461		2.99	%		566,942			4,103		2.94	%		550,351			4,035			2.91	%
Federal funds sold		19,645			82		1.67	%		20,325			73		1.46	%		18,227			14			0.30	%
Interest-bearing deposits with other financial institutions		42,750			155		1.45	%		35,463			165		1.89	%		42,693			177			1.64	%
FHLB stock		12,530			162		5.19	%		11,806			140		4.81	%		11,160			155			5.51	%
Total interest earning assets(1)		4,325,910			59,435		5.51	%		4,261,599			55,218		5.25	%		4,253,749			55,740			5.20	%
Noninterest Earning Assets:
Cash and due from banks		48,184								43,261								57,406
Allowance for loan losses		(24,771	)							(24,311	)							(23,470	)
Other assets		414,668								397,945								376,984
Total noninterest earning assets		438,081								416,895								410,920
Total assets	$	4,763,991							$	4,678,494							$	4,664,669
Interest-bearing liabilities:
Interest bearing deposits:
Interest bearing checking	$	935,351		$	1,571		0.67	%	$	943,707		$	1,357		0.58	%	$	832,030		$	1,146			0.55	%
Money market		1,005,081			2,311		0.92	%		975,831			1,890		0.79	%		1,071,194			1,991			0.74	%
Savings deposits		181,461			69		0.15	%		179,925			68		0.15	%		178,574			72			0.16	%
Customer time deposits		628,709			1,638		1.04	%		617,784			1,423		0.93	%		577,003			1,067			0.73	%
Broker and internet time deposits		75,699			309		1.64	%		84,125			333		1.61	%		95,480			380			1.58	%
Time deposits		704,408			1,947		1.11	%		701,909			1,756		1.01	%		672,483			1,447			0.85	%
Total interest bearing deposits		2,826,301			5,898		0.84	%		2,801,372			5,071		0.73	%		2,754,281			4,656			0.67	%
Other interest-bearing liabilities:
Securities sold under agreements to repurchase and federal funds purchased		20,002			45		0.90	%		15,160			25		0.67	%		15,883			11			0.27	%
Federal Home Loan Bank advances		253,131			1,171		1.86	%		211,735			917		1.76	%		241,307			967			1.59	%
Subordinated debt		30,930			412		5.34	%		30,930			406		5.32	%		30,930			414			5.31	%
Total other interest-bearing liabilities		304,063			1,628		2.15	%		257,825			1,348		2.12	%		288,120			1,392			1.92	%
Total Interest-bearing liabilities		3,130,364			7,526		0.96	%		3,059,197			6,419		0.85	%		3,042,401			6,048			0.79	%
Noninterest bearing liabilities:
Demand deposits		975,760								927,213								964,030
Other liabilities		41,917								92,886								79,382
Total noninterest-bearing liabilities		1,017,677								1,020,099								1,043,412
Total liabilities		4,148,041								4,079,296								4,085,813
Shareholders' equity		615,950								599,198								578,856
Total liabilities and shareholders' equity	$	4,763,991							$	4,678,494							$	4,664,669
Net interest income(1)				$	51,909							$	48,799							$	49,692
Interest rate spread(1)							4.55	%							4.40	%								4.41	%
Net interest margin(1)							4.81	%							4.64	%								4.63	%
Cost of total deposits							0.62	%							0.55	%								0.50	%
Average interest-earning assets to average interest-bearing liabilities							138.2	%							139.3	%								139.8	%
Tax equivalent adjustment				$	392							$	370							$	709
Loan HFI yield components:
Contractual interest rate(1)				$	44,057		5.37	%				$	41,536		5.28	%				$	41,026			5.20	%
Origination and other loan fee income					3,742		0.46	%					2,867		0.37	%					2,084			0.26	%
Accretion on purchased loans					1,928		0.23	%					1,687		0.21	%					1,935			0.24	%
Nonaccrual interest					250		0.03	%					399		0.05	%					1,216			0.15	%
Syndication fee income					216		0.03	%					75		0.01	%					242			0.03	%
Total loan yield				$	50,193		6.12	%				$	46,564		5.92	%				$	46,503			5.88	%

(1) Includes tax equivalent adjustment using combined marginal tax rate of 26.060% for 2018 and 39.225% for 2017.

 

FB Financial Corporation 9

Average Balance, Average Yield Earned and Average Rate Paid
For the Periods Ended
(Unaudited)
(In Thousands, Except %)
	For the year ended								For the year ended
	December 31, 2018								December 31, 2017
	Averagebalances			Interestincome/expense		Averageyield/rate			Averagebalances			Interestincome/expense		Averageyield/rate
Interest-earning assets:
Loans HFI(1)	$	3,376,203		$	205,543		6.09	%	$	2,418,261		$	136,950		5.66	%
Loans held for sale		352,370			15,632		4.44	%		419,290			17,256		4.12
Securities:
Taxable		478,034			12,397		2.59	%		441,568			10,084		2.28
Tax-exempt(1)		119,295			5,473		4.59	%		116,384			6,592		5.66
Total securities(1)		597,329			17,870		2.99	%		557,952			16,676		2.99
Federal funds sold		21,466			412		1.92	%		75,567			140		0.69
Interest-bearing deposits with other financial institutions		49,549			998		2.01	%		75,567			954		1.26
FHLB stock		12,742			716		5.62	%		8,894			460		5.17
Total interest earning assets(1)		4,409,659			241,171		5.47	%		3,555,531			172,436		4.93
Noninterest Earning Assets:
Cash and due from banks		49,410								53,653
Allowance for loan losses		(25,747	)							(22,967	)
Other assets		411,543								280,333
Total noninterest earning assets		435,206								311,019
Total assets	$	4,844,865							$	3,866,550
Interest-bearing liabilities:
Interest bearing deposits:
Interest bearing checking	$	894,252		$	6,488		0.73	%	$	762,918		$	3,640		0.48	%
Money market		1,027,047			10,895		1.06	%		888,258			5,387		0.61
Savings deposits		178,303			272		0.15	%		156,328			245		0.16
Customer time deposits		744,834			10,409		1.40	%		467,507			3,077		0.66
Broker and internet time deposits		82,113			1,472		1.79	%		44,234			682		1.54
Time deposits		826,947			11,881		1.44	%		511,741			3,759		0.73
Total interest bearing deposits		2,926,549			29,536		1.01	%		2,319,245			13,031		0.56
Other interest-bearing liabilities:
Securities sold under agreements to repurchase and federal funds purchased		19,528			150		0.77	%		16,968			42		0.25
Federal Home Loan Bank advances		216,011			4,166		1.93	%		110,764			1,778		1.61
Subordinated debt		30,930			1,651		5.34	%		30,930			1,491		4.82
Total other interest-bearing liabilities		266,469			5,967		2.24	%		158,662			3,311		2.09
Total Interest-bearing liabilities		3,193,018			35,503		1.11	%		2,477,907			16,342		0.66	%
Noninterest bearing liabilities:
Demand deposits		967,663								814,643
Other liabilities		54,262								52,389
Total noninterest-bearing liabilities		1,021,925								867,032
Total liabilities		4,214,943								3,344,939
Shareholders' equity		629,922								466,219
Total liabilities and shareholders' equity	$	4,844,865							$	3,811,158
Net interest income(1)				$	205,668							$	156,094
Interest rate spread(1)							4.36	%							4.36	%
Net interest margin(1)							4.66	%							4.46	%
Cost of total deposits							0.76	%							0.42	%
Average interest-earning assets to average interest-bearing liabilities							138.1	%							141.3	%
Tax equivalent adjustment				$	1,600							$	2,823
Loan HFI yield components:
Contractual interest rate(1)				$	183,116		5.42	%				$	119,617		4.95	%
Origination and other loan fee income					13,093		0.39	%					7,638		0.32	%
Accretion on purchased loans					7,608		0.23	%					5,419		0.22	%
Nonaccrual interest					1,375		0.04	%					3,266		0.14	%
Syndication fee income					351		0.01	%					1,010		0.04	%
Total loan yield				$	205,543		6.09	%				$	136,950		5.66	%

(1) Includes tax equivalent adjustment using combined marginal tax rate of 26.060% for 2018 and 39.225% for 2017.

FB Financial Corporation 10

Loans and Deposits by Market
For the Quarters Ended
(Unaudited)
(In Thousands)
	2018								2017
	Fourth Quarter		Third Quarter		Second Quarter		First Quarter		Fourth Quarter
Loans by market
Metropolitan	$	2,413,674	$	2,335,771	$	2,210,419	$	2,076,465	$	1,984,826
Community		788,619		765,231		771,358		764,198		780,079
Specialty lending and other		465,218		437,529		433,798		404,000		402,006
Total	$	3,667,511	$	3,538,531	$	3,415,575	$	3,244,663	$	3,166,911
Deposits by market
Metropolitan	$	2,283,983	$	2,228,902	$	2,112,941		2,079,983	$	2,091,927
Community		1,451,494		1,427,310		1,392,649		1,409,612		1,291,922
Mortgage and other(1)		436,240		473,261		404,273		276,556		280,546
Total	$	4,171,717	$	4,129,473	$	3,909,863	$	3,766,151	$	3,664,395

(1) Includes deposits related to escrow balances from mortgage servicing portfolio and wholesale/other deposits.

 

FB Financial Corporation 11

Segment Data
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
	2018												2017
	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Banking segment
Net interest income	$	51,344		$	52,733		$	51,669		$	48,771		$	49,422
Provision for loan losses		2,200			1,818			1,063			317			956
Mortgage banking income retail footprint		5,041			7,417			6,894			6,108			6,455
Other noninterest income		8,252			7,706			7,219			6,804			6,737
Other noninterest mortgage banking expenses		4,542			6,383			5,649			5,097			5,294
Merger and conversion expense		401			—			—			1,193			2,069
Other noninterest expense		32,531			32,009			31,127			30,951			30,060
Pre-tax income after allocations	$	24,963		$	27,646		$	27,943		$	24,125		$	24,235
Total assets	$	4,752,111		$	4,637,097		$	4,443,469		$	4,220,543		$	4,130,349
Intracompany funding income included in net interest income		3,035			3,997			4,517			4,508			5,276
Core efficiency ratio*		52.9	%		52.4	%		51.8	%		55.2	%		55.5	%
Mortgage segment
Net interest income	$	23		$	22		$	(152	)	$	(342	)	$	(439	)
Provision for loan losses		—			—			—			—			—
Noninterest income		13,956			19,232			21,650			20,363			23,825
Noninterest expense		16,262			18,821			19,582			18,910			20,117
Direct (loss) contribution	$	(2,283	)	$	433		$	1,916		$	1,111		$	3,269
Total assets	$	384,653		$	421,070		$	479,780		$	504,873		$	597,364
Intracompany funding expense included in net interest income		3,035			3,397			4,517			4,508			5,276
Core efficiency ratio*		98.9	%		85.8	%		83.6	%		85.7	%		83.8	%
Interest rate lock commitments volume during the period
Consumer direct	$	463,669		$	715,739		$	785,965		$	719,730		$	677,449
Third party origination (TPO)		168,139			206,651			239,995			245,679			189,299
Retail		242,059			319,073			359,284			329,720			268,720
Correspondent		437,482			463,473			590,743			833,857			678,346
Total	$	1,311,349		$	1,704,936		$	1,975,987		$	2,128,986		$	1,813,814
Interest rate lock commitments pipeline (period end)
Consumer direct	$	147,297		$	224,648		$	291,874		$	246,650		$	246,982
Third party origination (TPO)		53,080			72,890			92,526			107,365			63,034
Retail		70,389			94,693			117,912			124,538			72,939
Correspondent		47,940			60,589			95,256			214,424			121,201
Total	$	318,706		$	452,820		$	597,568		$	692,977		$	504,156
Mortgage sales
Consumer direct	$	421,897		$	577,070		$	483,434		$	592,873		$	567,529
Third party origination (TPO)		145,385			178,238			205,050			160,903			216,866
Retail		63,261			85,561			79,497			64,925			68,695
Retail footprint		168,554			227,985			210,958			169,778			205,228
Reverse		7,262			11,154			12,252			14,779			20,587
Correspondent		424,717			454,020			715,733			679,561			606,526
Total	$	1,231,076		$	1,534,028		$	1,706,924		$	1,682,819		$	1,685,431
Gains and fees from origination and sale of mortgage loans held for sale	$	21,483		$	26,094		$	27,017		$	23,481		$	29,577
Net change in fair value of loans held for sale, derivatives, and other		(4,623	)		(2,320	)		(2,299	)		(90	)		(3,317	)
Change in fair value of mortgage servicing rights, net of hedging		(2,481	)		(2,701	)		(1,778	)		(1,713	)		(190	)
Mortgage servicing income		4,618			5,576			5,604			4,793			4,210
Total mortgage banking income	$	18,997		$	26,649		$	28,544		$	26,471		$	30,280
Mortgage sale margin (a)		1.75	%		1.70	%		1.58	%		1.40	%		1.75	%

*These measures are considered non-GAAP financial measures. See "GAAP Reconciliation and Use of Non-GAAP financial measures" and the corresponding financial tables below for a reconciliation and discussion of these non-GAAP measures for a reconciliation and discussion of this non-GAAP measure.

(a) Calculated by dividing gains and fees from origination and sale of mortgage loans held for sale by total mortgage sales.

FB Financial Corporation 12

 

Loan Portfolio and Asset Quality
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
	2018																								2017
	Fourth Quarter			% of Total			Third Quarter			% of Total			Second Quarter			% of Total			First Quarter			% of Total			Fourth Quarter			% of Total
Loan portfolio
Commercial and industrial	$	862,043			24	%	$	840,439			24	%	$	813,054			24	%	$	765,115			24	%	$	715,075			23	%
Construction		525,455			14	%		491,171			14	%		522,471			15	%		466,495			14	%		448,326			14	%
Residential real estate:
1-to-4 family mortgage		555,815			15	%		553,720			16	%		528,158			15	%		491,725			15	%		480,989			15	%
Residential line of credit		226,116			6	%		214,741			6	%		208,668			6	%		197,740			6	%		194,986			6	%
Multi-family mortgage		75,457			2	%		86,264			2	%		57,344			2	%		63,295			2	%		62,374			2	%
Commercial real estate:
Owner occupied		493,524			14	%		504,149			14	%		470,872			14	%		499,331			16	%		495,872			16	%
Non-owner occupied		700,248			19	%		628,336			18	%		600,629			18	%		562,128			17	%		551,588			17	%
Consumer and other		228,853			6	%		219,711			6	%		214,379			6	%		198,834			6	%		217,701			7	%
Total loans HFI	$	3,667,511			100	%	$	3,538,531			100	%	$	3,415,575			100	%	$	3,244,663			100	%	$	3,166,911			100	%
Allowance for loan losses rollforward summary			��
Allowance for loan losses at the beginning of the period	$	27,608					$	26,347					$	24,406					$	24,041					$	23,482
Charge-off's		(806	)					(917	)					(421	)					(661	)					(719	)
Recoveries		279						360						1,299						709						322
Provision for loan losses		2,200						1,818						1,063						317						956
Adjustment for transfers to loans HFS		(349	)					—						—						—						—
Allowance for loan losses at the end of the period	$	28,932					$	27,608					$	26,347					$	24,406					$	24,041
Allowance for loan losses as a percentage of total loans HFI		0.79	%					0.78	%					0.77	%					0.75	%					0.76	%
Charge-offs
Commercial and Industrial	$	(340	)				$	(333	)				$	(5	)				$	(220	)				$	(63	)
Construction		—						(14	)					(15	)					—						(21	)
Residential real estate:
1-to-4 family mortgage		(69	)					(4	)					(5	)					(60	)					(45	)
Residential line of credit		(3	)					(13	)					—						(20	)					(72	)
Multi-family mortgage		—						—						—						—						—
Commercial real estate:
Owner occupied		(36	)					(55	)					—						—						(224	)
Non-owner occupied		—						—						—						—						—
Consumer and other		(358	)					(498	)					(396	)					(361	)					(294	)
Total Charge Offs:		(806	)					(917	)					(421	)					(661	)					(719	)
Recoveries
Commercial and Industrial		16						104						135						135						100
Construction		37						13						862						252						4
Residential real estate:
1-to-4 family mortgage		14						99						43						15						33
Residential line of credit		76						31						44						27						27
Multi-family mortgage		—						—						—						—						—
Commercial real estate:
Owner occupied		2						10						108						23						22
Non-owner occupied		—						—						—						51						4
Consumer and other		134						103						107						206						132
Total Recoveries:		279						360						1,299						709						322
Net (charge-off's) recoveries	$	(527	)				$	(557	)				$	878					$	48					$	(397	)
Net charge-off's (recoveries) as a percentage of average total loans		0.06	%					0.06	%					(0.11	)%					(0.01	)%					0.05	%
Loans classified as substandard	$	66,487					$	60,346					$	58,467					$	52,835					$	55,488
Purchased credit impaired loans		68,999						73,651						78,313						85,752						88,835

FB Financial Corporation 13

Loan Portfolio and Asset Quality
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
	2018												2017
	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Nonperforming assets(b)
Past due 90 days or more and accruing interest	$	3,041		$	2,364		$	1,639		$	2,689		$	1,996
Nonaccrual		13,685			8,355			7,174			6,954			8,101
Total nonperforming loans held for investment	$	16,726		$	10,719		$	8,813		$	9,643		$	10,097
Loans held for sale(a)		397			—			—			501			43,035
Other real estate owned- foreclosed		7,262			8,206			9,258			9,755			10,547
Other real estate owned- acquired excess facilities		5,381			5,381			5,381			5,579			5,895
Other assets		1,637			1,564			2,341			2,342			2,369
Total nonperforming assets	$	31,403		$	25,870		$	25,793		$	27,820		$	71,943
Total nonperforming loans as a percentage of loans held for investment		0.46	%		0.30	%		0.26	%		0.30	%		0.32	%
Total nonperforming assets as a percentage of total assets		0.61	%		0.51	%		0.52	%		0.59	%		1.52	%
Total accruing loans over 90 days delinquent as a percentage of total assets		0.06	%		0.05	%		0.03	%		0.06	%		0.04	%
Loans restructured as troubled debt restructurings	$	6,794		$	7,679		$	8,603		$	8,675		$	8,604
Troubled debt restructurings as a percentage of loans held for investment		0.19	%		0.22	%		0.25	%		0.27	%		0.27	%

(a) Includes right to repurchase government guaranteed GNMA mortgage loans previously sold and internally serviced for the fourth quarter of 2017. In 2018 and prospectively, the Bank elected to discontinue this practice as the perceived benefit has decreased with rising rates.

(b) Nonperforming assets excludes purchase credit impaired loans.

 

FB Financial Corporation 14

Preliminary Capital Ratios
(Unaudited)
(In Thousands, Except %)
Computation of Tangible Common Equity to Tangible Assets:	December 31, 2018			December 31, 2017
Total Equity	$	671,857		$	596,729
Less:
Goodwill		137,190			137,190
Other intangibles		11,628			14,902
Tangible Common Equity	$	523,039		$	444,637
Total Assets	$	5,136,764		$	4,727,713
Less:
Goodwill		137,190			137,190
Other intangibles		11,628			14,902
Tangible Assets	$	4,987,946		$	4,575,621
Preliminary Total Risk-Weighted Assets	$	4,480,921		$	4,131,983
Total Common Equity to Total Assets		13.1	%		12.6	%
Tangible Common Equity to Tangible Assets*		10.5	%		9.7	%
	December 31, 2018			December 31, 2017
Preliminary Regulatory Capital:
Common Equity Tier 1 Capital	$	524,013		$	442,381
Tier 1 Capital	$	554,013		$	472,381
Total Capital	$	582,945		$	496,422
Preliminary Regulatory Capital Ratios:
Common Equity Tier 1		11.7	%		10.7	%
Tier 1 Risk-Based		12.4	%		11.4	%
Total Risk-Based		13.0	%		12.0	%
Tier 1 Leverage		11.5	%		10.5	%

*These measures are considered non-GAAP financial measures. See "GAAP Reconciliation and Use of Non-GAAP financial measures" and the corresponding financial tables below for a reconciliation and discussion of these non-GAAP measures.

 

FB Financial Corporation 15

Investment Portfolio
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
	2018																				2017
Securities (at fair value)	Fourth Quarter					Third Quarter					Second Quarter					First Quarter					Fourth Quarter
Available for sale debt securities
U.S. government agency securities	$	989		—	%	$	984		—	%	$	983		—	%	$	982		—	%	$	986		—	%
Mortgage-backed securities -residential		508,580		78	%		467,714		77	%		477,974		78	%		472,930		79	%		418,781		78	%
Municipals, tax exempt		138,887		21	%		130,672		21	%		122,247		20	%		113,158		19	%		109,251		20	%
Treasury securities		7,242		1	%		7,131		1	%		7,156		1	%		7,178		1	%		7,252		1	%
Total available for sale debt securities		655,698		100	%		606,501		99	%		608,360		99	%		594,248		99	%		536,270		99	%
Equity securities		3,107		—	%		3,067		1	%		3,075		1	%		3,099		1	%		7,722		1	%
Total securities	$	658,805		100	%	$	609,568		100	%	$	611,435		100	%	$	597,347		100	%	$	543,992		100	%
Securities to total assets		12.8	%				12.1	%				12.4	%				12.6	%				11.5	%

FB Financial Corporation 16

Non-GAAP Reconciliation
For the Quarters Ended
(Unaudited)
(In Thousands, Except Share Data and %)
	2018												2017
Net income, adjusted	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Pre-tax net income	$	22,680		$	28,079		$	29,859		$	25,236		$	27,504
Plus merger and offering-related expenses		401			—			671			1,193			2,069
Pre-tax net income, adjusted	$	23,081		$	28,079		$	30,530		$	26,429		$	29,573
Income tax expense, adjusted		5,745			6,702			7,794			5,793			11,308
Net income, adjusted	$	17,336		$	21,377		$	22,736		$	20,636		$	18,265
Weighted average common shares outstanding fully diluted		31,344,949			31,339,628			31,294,044			31,421,830			31,166,080
Diluted earnings per share, adjusted
Diluted earnings per common share	$	0.54		$	0.68		$	0.70		$	0.63		$	0.74
Plus merger and offering-related expenses		0.01			—			0.02			0.04			0.07
Less tax effect and benefit of enacted tax laws		—			—			—			(0.01	)		(0.22	)
Diluted earnings per share, adjusted	$	0.55		$	0.68		$	0.72		$	0.66		$	0.59
Pro forma net income, adjusted*		2018			2017			2016			2015			2014
Pre-tax net income	$	105,854		$	73,485		$	62,324		$	50,824		$	34,731
Plus merger and offering-related expenses		2,265			19,034			3,268			3,543			—
Less significant (losses) gains on securities, other real estate
owned and other items		—			—			(3,539	)		4,638			2,000
Pre tax net income, adjusted		108,119			92,519			69,131			49,729			32,731
Pro forma income tax expense, adjusted		26,033			34,749			25,404			18,425			11,662
Pro forma net income, adjusted	$	82,086		$	57,770		$	43,727		$	31,304		$	21,069
Weighted average common shares outstanding fully diluted		31,314,981			28,207,602			19,312,174			17,180,000			17,180,000
Pro forma diluted earnings per share, adjusted*
Diluted earnings per share	$	2.55		$	1.86		$	2.10		$	2.79		$	1.89
Plus merger and offering-related expenses		0.07			0.67			0.17			0.21			—
Less significant (losses) gains on securities, other
real estate owned and other items		—			—			(0.18	)		0.27			0.12
Less tax effect and benefit of enacted tax laws		(0.01	)		(0.48	)		(0.19	)		(0.91	)		(0.54	)
Pro forma diluted earnings per share, adjusted	$	2.61		$	2.05		$	2.26		$	1.82		$	1.23

*Prior to the IPO in the third quarter of 2016, the Company was an S corporation and did not incur federal income taxes.  In conjunction with the IPO, the Company converted to a C corporation.  These results are on a pro forma basis to reflect the results of the Company on a C corporation basis and combined effective tax rates of 35.63%, 35.08% and 36.75% for the years ended December 31, 2014, 2015 and 2016, respectively.

 

FB Financial Corporation 17

Non-GAAP Reconciliation
For the Quarters Ended
(Unaudited)
(In Thousands, Except Share Data and %)
	2018												2017
Core efficiency ratio (tax-equivalent basis)	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Total noninterest expense	$	53,736		$	57,213		$	56,358		$	56,151		$	57,540
Less merger and offering-related expenses		401			—			671			1,193			2,069
Core noninterest expense	$	53,335		$	57,213		$	55,687		$	54,958		$	55,471
Net interest income (tax-equivalent basis)	$	51,799		$	53,161		$	51,909		$	48,799		$	49,692
Total noninterest income		27,249			34,355			35,763			33,275			37,017
Less change in fair value on mortgage servicing rights		(2,481	)		(2,701	)		(1,778	)		(1,713	)		(190	)
Less gain (loss) on sales or write-downs of other real estate owned and other assets		33			446			(132	)		(118	)		(386	)
Less (loss) gain from securities, net		—			(27	)		(42	)		(47	)		1
Core noninterest income		29,697			36,637			37,715			35,153			37,592
Core revenue	$	81,496		$	89,798		$	89,624		$	83,952		$	87,284
Efficiency ratio (GAAP)(1)		68.4	%		65.7	%		64.6	%		68.7	%		66.9	%
Core efficiency ratio (tax-equivalent basis)		65.4	%		63.7	%		62.1	%		65.5	%		63.6	%

(1) Efficiency ratio (GAAP) is calculated by dividing reported noninterest expense by reported total revenue.

	2018												2017
Banking segment core efficiency ratio (tax equivalent)	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Core consolidated noninterest expense	$	53,335		$	57,213		$	55,687		$	54,958		$	55,471
Less Mortgage segment noninterest expense		16,262			18,821			19,582			18,910			20,117
Adjusted Banking segment noninterest expense		37,073			38,392			36,105			36,048			35,354
Adjusted core revenue		81,496			89,798			89,624			83,952			87,284
Less Mortgage segment noninterest income		13,956			19,232			21,650			20,363			23,825
Less change in fair value on mortgage servicing rights		(2,481	)		(2,701	)		(1,778	)		(1,713	)		(190	)
Adjusted Banking segment total revenue	$	70,021		$	73,267		$	69,752		$	65,302		$	63,649
Banking segment core efficiency ratio (tax-equivalent basis)		52.9	%		52.4	%		51.8	%		55.2	%		55.5	%
Mortgage segment core efficiency ratio (tax equivalent)
Consolidated Noninterest expense	$	53,736		$	57,213		$	56,358		$	56,151		$	57,540
Less Banking segment noninterest expense		37,474			38,392			36,776			37,241			37,423
Adjusted Mortgage segment noninterest expense	$	16,262		$	18,821		$	19,582		$	18,910		$	20,117
Total noninterest income		27,249			34,355			35,763			33,275			37,017
Less Banking segment noninterest income		13,293			15,123			14,113			12,912			13,192
Less change in fair value on mortgage servicing rights		(2,481	)		(2,701	)		(1,778	)		(1,713	)		(190	)
Adjusted Mortgage segment total revenue	$	16,437		$	21,933		$	23,428		$	22,076		$	24,015
Mortgage segment core efficiency ratio (tax-equivalent basis)		98.9	%		85.8	%		83.6	%		85.7	%		83.8	%

FB Financial Corporation 18

Non-GAAP Reconciliation
For the Quarters Ended
(Unaudited)
(In Thousands, Except Share Data and %)
	2018												2017
Mortgage contribution, adjusted	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Mortgage segment pre-tax net contribution	$	(2,283	)	$	433		$	1,916		$	1,111		$	3,269
Retail footprint:
Mortgage banking income		5,041			7,417			6,894			6,108			6,455
Mortgage banking expenses		4,542			6,383			5,649			5,097			5,294
Retail footprint pre-tax net contribution		499			1,034			1,245			1,011			1,161
Total mortgage banking pre-tax net (loss) contribution	$	(1,784	)	$	1,467		$	3,161		$	2,122		$	4,430
Pre-tax net income	$	22,680		$	28,079		$	29,859		$	25,236		$	27,504
% total mortgage banking pre-tax net contribution		N/A			5.2	%		10.6	%		8.4	%		16.1	%
Pre-tax net income, adjusted	$	23,081		$	28,079		$	30,530		$	26,429		$	29,573
% total mortgage banking pre-tax net contribution, adjusted		N/A			5.2	%		10.4	%		8.0	%		15.0	%

	2018												2017
Tangible assets and equity	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Tangible Assets
Total assets	$	5,136,764	��	$	5,058,167		$	4,923,249		$	4,725,416		$	4,727,713
Less goodwill		137,190			137,190			137,190			137,190			137,190
Less intangibles, net		11,628			12,403			13,203			14,027			14,902
Tangible assets	$	4,987,946		$	4,908,574		$	4,772,856		$	4,574,199		$	4,575,621
Tangible Common Equity
Total shareholders' equity	$	671,857		$	648,731		$	630,959		$	611,075		$	596,729
Less goodwill		137,190			137,190			137,190			137,190			137,190
Less intangibles, net		11,628			12,403			13,203			14,027			14,902
Tangible common equity	$	523,039		$	499,138		$	480,566		$	459,858		$	444,637
Common shares outstanding		30,724,532			30,715,792			30,683,353			30,671,763			30,535,517
Book value per common share	$	21.87		$	21.12		$	20.56		$	19.92		$	19.54
Tangible book value per common share	$	17.02		$	16.25		$	15.66		$	14.99		$	14.56
Total shareholders' equity to total assets		13.1	%		12.8	%		12.8	%		12.9	%		12.6	%
Tangible common equity to tangible assets		10.5	%		10.2	%		10.1	%		10.1	%		9.7	%
Net income	$	17,040		$	21,377		$	22,065		$	19,754		$	23,018
Return on tangible common equity		12.9	%		17.0	%		18.4	%		17.4	%		20.5	%

	2018												2017
Return on average tangible common equity	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Total average shareholders' equity	$	659,050		$	638,388		$	615,950		$	599,198		$	578,856
Less average goodwill		137,190			137,190			137,190			137,190			137,190
Less average intangibles, net		12,016			12,803			13,615			14,465			13,726
Average tangible common equity	$	509,845		$	488,395		$	465,145		$	447,544		$	427,940
Net income	$	17,040		$	21,377		$	22,065		$	19,754		$	23,018
Return on average tangible common equity		13.3	%		17.4	%		19.0	%		17.9	%		21.3	%

FB Financial Corporation 19

Non-GAAP Reconciliation
For the Quarters Ended
(Unaudited)
(In Thousands, Except Share Data and %)
	2018												2017
Return on average tangible common equity, adjusted	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Average tangible common equity	$	509,845		$	488,395		$	465,145		$	447,544		$	427,940
Net income, adjusted		17,336			21,377			22,736			20,636			18,265
Return on average tangible common equity, adjusted		13.5	%		17.4	%		19.6	%		18.7	%		16.9	%

Pro forma return on average tangible common equity	2018			2017			2016			2015			2014
Total average shareholders' equity	$	629,922		$	466,219		$	276,587		$	228,844		$	203,615
Less average goodwill		137,190			84,997			46,867			46,904			46,904
Less average intangibles, net		12,815			8,047			5,353			5,095			4,302
Average tangible common equity	$	479,917		$	373,175		$	224,367		$	176,845		$	152,410
Pro forma net income		80,236			52,398			39,422			32,995			22,356
Pro forma return on average tangible common equity		16.7	%		14.0	%		17.6	%		18.7	%		14.7	%

Pro forma return on average tangible common equity, adjusted	2018			2017			2016			2015			2014
Average tangible common equity	$	479,917		$	373,175		$	224,367		$	176,845		$	152,410
Pro forma net income, adjusted		82,086			57,770			43,727			31,304			21,069
Pro forma return on average tangible common equity, adjusted		17.1	%		15.5	%		19.5	%		17.7	%		13.8	%

	2018												2017
Return on average assets and equity, adjusted	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter
Net income	$	17,040		$	21,377		$	22,065		$	19,754		$	23,018
Average assets		5,005,158			4,932,197			4,763,991			4,678,494			4,664,669
Average equity		659,050			638,388			615,950			599,198			578,856
Return on average assets		1.35	%		1.72	%		1.86	%		1.71	%		1.96	%
Return on average equity		10.3	%		13.3	%		14.4	%		13.4	%		15.8	%
Net income, adjusted	$	17,336		$	21,377		$	22,736		$	20,636		$	18,265
Return on average assets, adjusted		1.37	%		1.72	%		1.91	%		1.79	%		1.55	%
Return on average equity, adjusted		10.4	%		13.3	%		14.8	%		14.0	%		12.5	%

Pro forma return on average assets and equity, adjusted	2018			2017			2016			2015			2014
Pro forma net income	$	80,236		$	52,398		$	39,422		$	32,995		$	22,356
Average assets		4,844,865			3,811,158			3,001,275			2,577,895			2,311,297
Average equity		629,922			466,219			276,587			228,844			203,615
Pro forma return on average assets		1.66	%		1.37	%		1.31	%		1.28	%		0.97	%
Pro forma return on average equity		12.7	%		11.2	%		14.3	%		14.4	%		11.0	%
Pro forma net income, adjusted	$	82,086		$	57,770		$	43,727		$	31,304		$	21,069
Pro forma return on average assets, adjusted		1.69	%		1.52	%		1.46	%		1.21	%		0.91	%
Pro forma return on average equity, adjusted		13.0	%		12.4	%		15.8	%		13.7	%		10.3	%

FB Financial Corporation 20