Exhibit 99.1
For immediate release | For More Information: | |
J. Bruce Hildebrand, Executive Vice President | ||
325.627.7155 |
FIRST FINANCIAL BANKSHARES ANNOUNCES
SECOND QUARTER EARNINGS RESULTS
SECOND QUARTER EARNINGS RESULTS
ABILENE, Texas, July 19, 2007 — First Financial Bankshares, Inc. (NASDAQ: FFIN) increased earnings 15.9 percent for the second quarter of 2007 to $13.27 million, compared with $11.45 million in the same quarter last year. Basic earnings per share were $0.64 compared with $0.55 in the same period last year. The increase in earnings was a result primarily from an increase in the pretax gain on sale of student loans that totaled $1.62 million in the second quarter of 2007 compared to $462,000 in the same quarter of 2006.
Net interest income for the second quarter increased 2.7 percent to $27.25 million compared with $26.54 million in the same quarter last year. The provision for loan losses was $238,000 in the second quarter of 2007, down from $389,000 in the same quarter last year. The net interest margin, on a taxable equivalent basis, was 4.38 percent for the second quarter of 2007 compared with 4.50 percent in the same period a year ago but unchanged from the first quarter of 2007.
Noninterest income in the second quarter was $12.97 million compared with $10.95 million in the same quarter last year. A large portion of this increase resulted from the sale of student loans discussed above. In 2006, the Company sold the majority of its student loans in the first quarter, recording a similar premium compared to the second quarter of 2007. The Company made a decision to delay the 2007 first quarter sale of student loans to May 2007 in order to earn additional interest income.
Trust fees increased 23.9 percent in the second quarter to $2.27 million compared with $1.83 million in the same quarter last year due to continued growth of trust assets. Service charges on deposit accounts decreased 1.9 percent in the second quarter of 2007 to $5.55 million compared with $5.66 million a year ago, reflecting declining use of overdraft privilege, offset in part by strong growth in new accounts. Real estate mortgage fees increased 54.3 percent to $864,000 from $560,000 in the same quarter last year. ATM and credit card fees increased 20.6 percent to $1.86 million versus $1.54 million a year ago, indicative of continued increased use of debit cards and the growth in net new accounts.
Noninterest expense increased 2.1 percent in the second quarter of 2007 to $21.25 million from $20.81 million in the same quarter last year. The Company’s efficiency ratio in the second quarter stood at 51.19 percent compared with 53.82 percent in the same quarter a year ago.
For the first half of 2007, net income was $24.73 million, up 7.9 percent compared with $22.92 million a year ago. Basic earnings per share for the first half of 2007 were $1.19 compared with $1.11 in the same period last year. Net interest income increased 3.1 percent in the first half of 2007 to $53.82 million from $52.19 million in the same period last year. Noninterest income was $23.89 million in the first half of 2007, up 6.5 percent from $22.43 million a year ago.
“We experienced solid growth in loans, new accounts, trust fees and real estate mortgage fees in the second quarter, while continuing to control expenses, all of which contributed to our Company’s favorable results for the second quarter and the first half of the year,” said F. Scott Dueser, President and Chief Executive Officer. “We are pleased with our results, given the cautious economic environment and continuing net interest margin pressure.”
As of June 30, 2007, consolidated assets for the Company totaled $2.85 billion compared with $2.72 billion a year ago. Loans totaled $1.39 billion at quarter end, compared with loans of $1.29 billion a year ago. Excluding the effect of the sale of student loans, quarter-end loans increased 7.8 percent over the same period a year ago and at an annualized growth rate of 10.3 percent over March 31, 2007.
Total deposits as of June 30, 2007, stood at $2.38 billion from $2.31 billion a year earlier. Non-interest-bearing deposits grew 6.7 percent compared with the same period a year ago, while interest-bearing deposits grew 1.7 percent as the Company focused on low costs of funds and its effect on the net interest margin. Shareholders’ equity rose to $306.5 million as of June 30, 2007, compared with $279.8 million the prior year.
Headquartered in Abilene, Texas, First Financial Bankshares is a financial holding company that operates ten separately chartered banks with 45 locations in Texas. The bank subsidiaries are First Financial Bank, N.A., Abilene, Clyde, Moran and Albany; First Financial Bank, N.A., Eastland, Ranger and Rising Star; First Financial Bank, N.A., Cleburne, Burleson, Alvarado and Midlothian; Hereford State Bank, Hereford; First Financial Bank, N.A., Mineral Wells; San Angelo National Bank, San Angelo; First Financial Bank, N.A., Southlake, Trophy Club, Keller, Bridgeport, Decatur and Boyd; First Financial Bank, N.A., Stephenville, Granbury and Glen Rose; First National Bank, Sweetwater, Roby and Trent; and Weatherford National Bank, Weatherford, Willow Park and Aledo. The Company also operates First Financial Trust & Asset Management Company, N.A., with five locations and First Technology Services, Inc., a technology operating company.
The Company is listed on The NASDAQ Global Select Market under the trading symbol FFIN. For more information about First Financial Bankshares, please visit our Web site at http://www.ffin.com.
*****
Certain statements contained herein may be considered “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon the belief of the Company’s management, as well as assumptions made beyond information currently available to the Company’s management, and may be, but not necessarily are, identified by such words as “expect”, “plan”, “anticipate”, “target”, “forecast” and “goal”. Because such “forward-looking statements” are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from the Company’s expectations include competition from other financial institutions and financial holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses, and similar variables. Other key risks are described in the Company’s reports filed with the Securities and Exchange Commission, which may be obtained under “Investor Relations-Documents/Filings” on the Company’s Web site or by writing or calling the Company at 325.627.7155. Except as otherwise stated in this news announcement, the Company does not undertake any obligation to update publicly or revise any forward-looking statements because of new information, future events or otherwise.
FIRST FINANCIAL BANKSHARES, INC.
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
(In thousands, except share and per share data)
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
(In thousands, except share and per share data)
June 30, | ||||||||
2007 | 2006 | |||||||
ASSETS: | ||||||||
Cash and due from banks | $ | 113,794 | $ | 125,796 | ||||
Fed funds sold | 54,760 | 30,950 | ||||||
Investment securities | 1,135,133 | 1,112,112 | ||||||
Loans | 1,391,984 | 1,293,111 | ||||||
Allowance for loan losses | (16,425 | ) | (15,473 | ) | ||||
Net loans | 1,375,559 | 1,277,638 | ||||||
Premises and equipment | 61,204 | 58,905 | ||||||
Goodwill | 62,112 | 62,146 | ||||||
Other intangible assets | 3,829 | 5,470 | ||||||
Other assets | 44,061 | 42,406 | ||||||
Total assets | $ | 2,850,452 | $ | 2,715,423 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY: | ||||||||
Noninterest-bearing deposits | $ | 664,952 | $ | 622,994 | ||||
Interest-bearing deposits | 1,711,799 | 1,683,629 | ||||||
Total deposits | 2,376,751 | 2,306,623 | ||||||
Short-term borrowings | 147,110 | 110,842 | ||||||
Other liabilities | 20,075 | 18,186 | ||||||
Shareholders’ equity | 306,516 | 279,772 | ||||||
Total liabilities and shareholders’ equity | $ | 2,850,452 | $ | 2,715,423 | ||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
INCOME STATEMENTS | 2007 | 2006 | 2007 | 2006 | ||||||||||||
Interest income | $ | 42,259 | $ | 38,140 | $ | 83,331 | $ | 74,541 | ||||||||
Interest expense | 15,013 | 11,598 | 29,512 | 22,349 | ||||||||||||
Net interest income | 27,246 | 26,542 | 53,819 | 52,192 | ||||||||||||
Provision for loan losses | 238 | 389 | 479 | 722 | ||||||||||||
Net interest income after provision for loan losses | 27,008 | 26,153 | 53,340 | 51,470 | ||||||||||||
Noninterest income | 12,972 | 10,954 | 23,892 | 22,433 | ||||||||||||
Noninterest expense | 21,247 | 20,805 | 42,114 | 41,283 | ||||||||||||
Net income before income taxes | 18,733 | 16,302 | 35,118 | 32,620 | ||||||||||||
Income tax expense | 5,463 | 4,854 | 10,385 | 9,705 | ||||||||||||
Net income | $ | 13,270 | $ | 11,448 | $ | 24,733 | $ | 22,915 | ||||||||
PER COMMON SHARE DATA | ||||||||||||||||
Net income — basic | $ | 0.64 | $ | 0.55 | $ | 1.19 | $ | 1.11 | ||||||||
Net income — diluted | 0.64 | 0.55 | 1.18 | 1.10 | ||||||||||||
Cash dividends | 0.32 | 0.30 | 0.62 | 0.58 | ||||||||||||
Book value | 14.76 | 13.50 | ||||||||||||||
Market value | 38.81 | 36.54 | ||||||||||||||
Shares outstanding — end of period | 20,760,116 | 20,727,734 | 20,760,116 | 20,727,734 | ||||||||||||
Average outstanding shares — basic | 20,756,846 | 20,722,054 | 20,752,044 | 20,718,763 | ||||||||||||
Average outstanding shares — diluted | 20,888,879 | 20,775,448 | 20,872,613 | 20,775,648 | ||||||||||||
PERFORMANCE RATIOS | ||||||||||||||||
Return on average assets | 1.86 | % | 1.68 | % | 1.75 | % | 1.69 | % | ||||||||
Return on average equity | 17.25 | 16.48 | 16.35 | 16.59 | ||||||||||||
Net interest margin (tax equivalent) | 4.38 | 4.50 | 4.38 | 4.45 | ||||||||||||
Efficiency ratio | 51.19 | 53.82 | 52.50 | 53.64 |
FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands)
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands)
Quarter Ended | ||||||||||||||||||||
2007 | 2006 | |||||||||||||||||||
June 30, | March 31, | Dec. 31, | Sept. 30, | June 30, | ||||||||||||||||
ALLOWANCE FOR LOAN LOSSES | ||||||||||||||||||||
Balance at beginning of period | $ | 16,458 | $ | 16,201 | $ | 16,498 | $ | 15,473 | $ | 15,116 | ||||||||||
Loans charged off | (505 | ) | (147 | ) | (788 | ) | (272 | ) | (379 | ) | ||||||||||
Loan recoveries | 234 | 162 | 244 | 206 | 347 | |||||||||||||||
Net (charge-offs) recoveries | (271 | ) | 15 | (544 | ) | (66 | ) | (32 | ) | |||||||||||
Provision for loan losses | 238 | 242 | 247 | 1,091 | 389 | |||||||||||||||
Balance at end of period | $ | 16,425 | $ | 16,458 | $ | 16,201 | $ | 16,498 | $ | 15,473 | ||||||||||
Allowance for loan losses / period-end loans | 1.18 | % | 1.17 | % | 1.18 | % | 1.23 | % | 1.20 | % | ||||||||||
Allowance for loan losses / nonperforming loans | 387.4 | 226.5 | 442.9 | 401.6 | 370.0 | |||||||||||||||
Net charge-offs (recoveries) / average loans (annualized) | 0.08 | 0.00 | 0.16 | 0.02 | 0.01 | |||||||||||||||
NONPERFORMING ASSETS | ||||||||||||||||||||
Nonaccrual loans | $ | 4,179 | $ | 6,338 | $ | 3,529 | $ | 3,907 | $ | 4,088 | ||||||||||
Accruing loans 90 days past due | 61 | 928 | 129 | 201 | 94 | |||||||||||||||
Total nonperforming loans | 4,240 | 7,266 | 3,658 | 4,108 | 4,182 | |||||||||||||||
Foreclosed assets | 2,174 | 434 | 453 | 543 | 545 | |||||||||||||||
Total nonperforming assets | $ | 6,414 | $ | 7,700 | $ | 4,111 | $ | 4,651 | $ | 4,727 | ||||||||||
As a % of loans and foreclosed assets | 0.46 | % | 0.55 | % | 0.30 | % | 0.35 | % | 0.37 | % | ||||||||||
CAPITAL RATIOS | ||||||||||||||||||||
Tier 1 Risk-based | 14.85 | % | 14.71 | % | 14.35 | % | 14.72 | % | 14.51 | % | ||||||||||
Total Risk-based | 15.81 | 15.69 | 15.32 | 15.75 | 15.49 | |||||||||||||||
Tier 1 Leverage | 9.05 | 8.89 | 8.87 | 8.91 | 8.39 | |||||||||||||||
Equity to assets | 10.75 | 10.74 | 10.56 | 10.81 | 10.30 |
Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||
NONINTEREST INCOME | 2007 | 2006 | 2007 | 2006 | |||||||||||||||
Gain on sale of student loans, net | $ | 1,616 | $ | 462 | $ | 1,780 | $ | 1,872 | |||||||||||
Gain on securities transactions, net | — | — | 85 | — | |||||||||||||||
Trust fees | 2,272 | 1,834 | 4,372 | 3,681 | |||||||||||||||
Service charges on deposits | 5,553 | 5,658 | 10,692 | 10,946 | |||||||||||||||
Real estate mortgage fees | 864 | 560 | 1,602 | 1,009 | |||||||||||||||
Net gain (loss) on sale of foreclosed assets | 22 | (1 | ) | 35 | (13 | ) | |||||||||||||
ATM and credit card fees | 1,859 | 1,542 | 3,578 | 2,982 | |||||||||||||||
Other noninterest income | 786 | 899 | 1,748 | 1,956 | |||||||||||||||
Total Noninterest Income | $ | 12,972 | $ | 10,954 | $ | 23,892 | $ | 22,433 | |||||||||||
NONINTEREST EXPENSE | |||||||||||||||||||
Salaries and employee benefits | $ | 11,448 | $ | 11,128 | $ | 22,887 | $ | 22,425 | |||||||||||
Net occupancy expense | 1,445 | 1,514 | 2,854 | 2,990 | |||||||||||||||
Equipment expense | 1,812 | 1,790 | 3,557 | 3,496 | |||||||||||||||
Printing, stationery and supplies | 520 | 513 | 992 | 1,011 | |||||||||||||||
ATM and credit card expenses | 964 | 864 | 1,893 | 1,675 | |||||||||||||||
Audit fees | 256 | 231 | 505 | 480 | |||||||||||||||
Legal, tax and professional fees | 631 | 617 | 1,303 | 1,161 | |||||||||||||||
Correspondent bank service charges | 293 | 291 | 618 | 602 | |||||||||||||||
Advertising and public relations | 603 | 615 | 1,162 | 1,182 | |||||||||||||||
Amortization of intangible assets | 377 | 385 | 760 | 611 | |||||||||||||||
Other noninterest expense | 2,898 | 2,857 | 5,583 | 5,650 | |||||||||||||||
Total Noninterest Expense | $ | 21,247 | $ | 20,805 | $ | 42,114 | $ | 41,283 | |||||||||||
TAX EQUIVALENT YIELD ADJUSTMENT | $ | 1,286 | $ | 1,161 | $ | 2,512 | $ | 2,340 | |||||||||||
FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands)
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands)
Three Months Ended | ||||||||||||
June 30, 2007 | ||||||||||||
Average | Tax Equivalent | Yield / | ||||||||||
Balance | Interest | Rate | ||||||||||
Interest earning assets: | ||||||||||||
Fed funds sold | $ | 90,951 | $ | 1,162 | 5.12 | % | ||||||
Interest bearing deposits in nonaffiliated banks | 7,130 | 92 | 5.18 | % | ||||||||
Taxable securities | 830,248 | 9,651 | 4.65 | % | ||||||||
Tax exempt securities | 286,642 | 4,280 | 5.97 | % | ||||||||
Loans | 1,402,632 | 28,360 | 8.11 | % | ||||||||
Total interest earning assets | 2,617,603 | 43,545 | 6.68 | % | ||||||||
Noninterest earning assets | 251,563 | |||||||||||
Total assets | $ | 2,869,166 | ||||||||||
Interest bearing liabilities: | ||||||||||||
Deposits | $ | 1,749,306 | $ | 13,389 | 3.07 | % | ||||||
Fed funds purchased and other short term borrowings | 144,190 | 1,624 | 4.52 | % | ||||||||
Total interest bearing liabilities | 1,893,496 | 15,013 | 3.18 | % | ||||||||
Noninterest bearing liabilities | 667,054 | |||||||||||
Shareholders’ equity | 308,616 | |||||||||||
Total liabilities and shareholders’ equity | $ | 2,869,166 | ||||||||||
Net interest income and margin (tax equivalent) | $ | 28,532 | 4.38 | % | ||||||||
Six Months Ended | ||||||||||||
June 30, 2007 | ||||||||||||
Average | Tax Equivalent | Yield / | ||||||||||
Balance | Interest | Rate | ||||||||||
Interest earning assets: | ||||||||||||
Fed funds sold | $ | 73,816 | $ | 1,859 | 5.08 | % | ||||||
Interest bearing deposits in nonaffiliated banks | 6,090 | 157 | 5.20 | % | ||||||||
Taxable securities | 840,052 | 19,412 | 4.62 | % | ||||||||
Tax exempt securities | 277,577 | 8,320 | 5.99 | % | ||||||||
Loans | 1,399,806 | 56,095 | 8.08 | % | ||||||||
Total interest earning assets | 2,597,341 | 85,843 | 6.67 | % | ||||||||
Noninterest earning assets | 256,619 | |||||||||||
Total assets | $ | 2,853,960 | ||||||||||
Interest bearing liabilities: | ||||||||||||
Deposits | $ | 1,746,246 | $ | 26,297 | 3.04 | % | ||||||
Fed funds purchased and other short term borrowings | 141,045 | 3,215 | 4.60 | % | ||||||||
Total interest bearing liabilities | 1,887,291 | 29,512 | 3.15 | % | ||||||||
Noninterest bearing liabilities | 661,624 | |||||||||||
Shareholders’ equity | 305,045 | |||||||||||
Total liabilities and shareholders’ equity | $ | 2,853,960 | ||||||||||
Net interest income and margin (tax equivalent) | $ | 56,331 | 4.38 | % | ||||||||