Exhibit 99.1
Stock Yards Bancorp Posts Record Results for 2014
Fourth Quarter Net Income Increases 38%; Full Year 2014 up 28%
LOUISVILLE, Ky.--(BUSINESS WIRE)--January 28, 2015--Stock Yards Bancorp, Inc. (NASDAQ: SYBT), parent company of Stock Yards Bank & Trust Company, with offices in the Louisville, Indianapolis and Cincinnati metropolitan markets, today reported results for the fourth quarter and year ended December 31, 2014, with earnings per diluted share of $0.59 and $2.36, respectively. The Company's strong performance for 2014 continued to reflect several key drivers, including:
- A net increase in the loan portfolio of 8.6% for 2014, with record loan production for the year;
- Further improvements in overall credit quality, which enabled the Company to forego a provision for loan losses in the fourth quarter and post a net release of reserves for the year;
- 12% growth in revenue from investment management and trust services;
- A generally stable net interest margin; and
- Significantly higher returns on average equity and assets.
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The following is a summary of the Company's reported results: |
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Quarter Ended December 31, | | | | 2014 | | | 2013 | | | Change |
| Net income | | | | $ | 8,722,000 | | | $ | 6,313,000 | | | 38% |
| Net income per share, diluted | | | | $ | 0.59 | | | $ | 0.43 | | | 37% |
| Return on average equity | | | | | 13.46% | | | | 10.90% | | | |
| Return on average assets | | | | | 1.39% | | | | 1.07% | | | |
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Year Ended December 31, | | | | 2014 | | | 2013 | | | Change |
| Net income | | | | $ | 34,822,000 | | | $ | 27,170,000 | | | 28% |
| Net income per share, diluted | | | | $ | 2.36 | | | $ | 1.89 | | | 25% |
| Return on average equity | | | | | 14.19% | | | | 12.34% | | | |
| Return on average assets | | | | | 1.45% | | | | 1.22% | | | |
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"We are pleased to report significant and ongoing momentum in our operations as 2014 came to a close," said David P. Heintzman, Chairman and Chief Executive Officer, "leading to record earnings per diluted share for the fourth consecutive year. Throughout the past year, we have spoken of our strong loan pipeline coupled with a stable net interest margin, steadily improving credit quality, and the noteworthy contribution to operations from our investment management and trust department. Together these drivers combined in 2014 to produce substantial growth for the Company, generate strong returns for stockholders, and further secure our position as one of the nation's top-performing community banks.
"While we continued to experience pressure on overall loan growth during 2014 from early repayments, we were pleased to see accelerating loan production in the fourth quarter, which helped us overcome that challenge and finish the year with our portfolio increasing nearly 9%," Heintzman continued. "Driving this growth was a 10% overall increase in loan production, and we were pleased that all of our markets participated in this success. Additionally, in many instances where loan payoffs have occurred, they reflected economically driven actions by customers to dispose of loan collateral or pay down loans and lines of credit with available cash. Since these payoffs generally were not due to competitive pressure, we believe these customers remain excellent prospects for future lending opportunities as circumstances evolve.
"As to credit quality, we experienced steady and ongoing improvements throughout 2014, with many of the metrics used to assess the strength of our portfolio returning to their lowest levels since 2008," Heintzman noted. "These improvements provided the basis for our decision to release some loan loss reserves during 2014. We believe that our allowance for loan losses remains sufficient to absorb the risk inherent in our loan portfolio at year-end."
Heintzman noted that the Company's investment management and trust department, with $2.3 billion of assets under management, produced steadily higher revenue in each quarter of 2014, culminating in a record $18.2 million in revenue for the year – up 12% from 2013. Heintzman added, "We believe that our investment management and trust department continues to distinguish Stock Yards Bank & Trust among community banks, providing us with a significant source of recurring non-interest revenue – both in terms of breadth and quality, which most other community banks do not possess."
Heintzman continued, "Importantly, the achievements of the past year translated in a very tangible way in terms of enhanced stockholder value. During 2014, we raised our cash dividends to stockholders 9% cumulatively, reflecting two separate increases during the year. With the increases in 2014, we now have raised our dividend six times over the past four years for a cumulative increase of more than 35%."
Concluding, Heintzman said, "We enter 2015 with solid momentum and a sense of optimism about the growth opportunities for our company in the coming year. Our lending pipeline remains consistent with the level seen at this same time last year. Augmenting this, we expect to grow market share with the opening of three branch locations in 2015 – one on the south side of Indianapolis and two in northern Kentucky near the Cincinnati metropolitan area – as we seek to capitalize on local market opportunities. We do expect to encounter slower growth in the coming year with our investment management and trust services as some revenue that boosted 2014 results is not expected to recur at the same level in 2015. Still, we expect our investment management and trust department will continue to factor significantly in our financial results and provide strategic diversity to our revenue streams. With this outlook, we believe Stock Yards Bancorp – as a leading community bank in economically strong markets – remains poised for growth as the overall business climate continues to improve. Moreover, our strong capital base provides us with the financial flexibility to pursue growth opportunities as they arise and positions us to extend our record of steadily higher dividend payments as we strive to further enhance stockholder value."
Total assets increased $175 million or 7% at December 31, 2014, reaching $2.56 billion compared with $2.39 billion at December 31, 2013. The Company's loan portfolio increased $147 million or 9% to $1.87 billion at December 31, 2014, compared with $1.72 billion at December 31, 2013. Total deposits increased $143 million or 7% to $2.12 billion at December 31, 2014, from $1.98 billion at December 31, 2013. Core deposits as a percentage of total deposits increased to 93.9% at December 31, 2014, from 92.9% at December 31, 2013.
The Company's capital levels remained strong during the fourth quarter of 2014 and significantly exceeded the required minimums necessary to be considered a "well-capitalized" institution – the highest capital rating for financial institutions. With its consistently strong capital position, Stock Yards Bancorp has continued to enhance stockholder value steadily by increasing cash dividends while maintaining its financial flexibility to pursue expansion and other opportunities that may arise.
In conjunction with the review of income statement items, it should be noted that the Company's results for 2013 included non-core items, including the write-off of debt issuance costs related to the redemption of trust preferred securities in the fourth quarter and net acquisition costs incurred with the second quarter acquisition of THE BANCorp, INC. ("BANCorp"). These items reduced net income for the fourth quarter of 2013 by $835 thousand or $0.06 per diluted share and reduced net income for 2013 by $1.1 million or $0.08 per diluted shares.
Net interest income – the Company's largest source of revenue – increased $1.7 million or 8% to $21.5 million in the fourth quarter of 2014 from $19.8 million in the prior-year quarter. For 2014, net interest income increased $6.5 million or 8% to $83.8 million from $77.3 million in the prior-year period.
In the fourth quarter of 2014, net interest margin was 3.67% versus 3.80% in the third quarter of 2014 and 3.61% in the fourth quarter of 2013. The Company's normalized or core net interest margin (core net interest margin is a non-GAAP financial measure, see Reconciliation of Net Interest Margin to Core later in this release), which excludes the effect of prepayment penalties, late charges, interest adjustments on non-accrual loans, and the accretion of fair value adjustments, was 3.64% for the fourth quarter of 2014, down nine basis points from the third quarter of 2014, but up 11 basis points from the fourth quarter of 2013. The decline in core net interest margin in the fourth quarter of 2014 versus the linked third quarter was due primarily to excess liquidity caused by a temporary influx of public funds at the end of the year. This excess liquidity, which results in low-yielding short-term investments and consequently lower net interest margin, does not result in lower earnings. The Company expects liquidity to return to normal levels during the first and second quarters of 2015. Net interest margin in the fourth quarter of 2014 compared with the same quarter last year reflected a 13 basis point benefit from the early redemption of the Company's trust preferred securities at the end of December 2013.
Net interest margin for the full year increased 1 basis point to 3.75% from 3.74% for 2013. Core net interest margin for 2014 was 3.70%, up four basis points from 3.66% for 2013, again reflecting a benefit of 13 basis points from the early redemption of the Company's trust preferred securities in December 2013, which helped offset other margin pressures.
Non-performing loans (NPLs) totaled $11.9 million or 0.64% of total loans outstanding at December 31, 2014, representing the lowest year-end level as a percentage of total loans since 2008. This decline reflected the anticipated migration of one large credit to other real estate owned (OREO) after a charge down. NPLs at year-end 2014 were down from $20.5 million or 1.15% of total loans outstanding at September 30, 2014, and $22.9 million or 1.33% of total loans at December 31, 2013. Non-performing assets (NPAs), which include NPLs and repossessed assets, were $17.9 million or 0.70% of total assets at December 31, 2014, again the lowest year-end level as a percentage of total assets since 2008. NPAs at year-end 2014 were down from $23.3 million or 0.97% of total assets at September 30, 2014, and $28.5 million or 1.19% of total assets at December 31, 2013.
Net charge-offs in the fourth quarter of 2014 totaled $2.2 million or 0.12% of average loans, up from $537 thousand or 0.03% of average loans in the third quarter of 2014 and $2.0 million or 0.12% of average loans in the prior-year quarter. Net charge-offs for 2014 declined to 0.18% of average loans – the lowest point since 2008 – from 0.60% for 2013.
After releasing $2.1 million of reserves for loan losses in the third quarter of 2014, the Company did not record a loan loss provision for the fourth quarter of 2014. This resulted in a net release of loan loss reserves of $400 thousand for the year. In the fourth quarter of 2013, the loan loss provision was $1.6 million, resulting in a loan loss provision of $6.6 million for 2013. The allowance for loan losses was 1.33% of total loans as of December 31, 2014, compared with 1.52% of total loans at September 30, 2014, and 1.66% of total loans at December 31, 2013.
Total non-interest income was virtually flat in the fourth quarter of 2014 compared with the prior-year quarter, primarily reflecting declines in service charge fees and bankcard transaction revenue that were largely offset by higher revenue from investment management and trust services, and mortgage banking revenue. For 2014, total non-interest income increased $153 thousand or 0.4% to $39.2 million from $39.0 million in 2013, with the increase primarily reflecting higher revenue from investment management and trust services, which was partially offset by lower mortgage banking revenue. The prior year also included a bargain purchase gain of $449 thousand related to the acquisition of BANCorp during the second quarter of 2013.
Total non-interest expense for the fourth quarter of 2014 declined $125 thousand or 0.6% to $19.3 million from $19.4 million in the same period last year, primarily because of reduced losses on OREO. Total non-interest expense for 2014 increased 3% to $73.2 million compared with $71.4 million in 2013, primarily reflecting higher salaries and employee benefits attributable to the addition of lenders, investment management and trust department personnel, and operational employees to help promote and support future growth, along with the full-year impact of personnel added with the second quarter 2013 BANCorp acquisition. To a lesser extent, incentives and health insurance cost contributed to this increase. Higher salaries and employee benefits in 2014 were partially offset by the non-recurrence of 2013 acquisition costs and a net gain on OREO in 2014 versus a net loss on OREO in 2013.
In November 2014, Stock Yards Bancorp's Board of Directors declared a quarterly cash dividend of $0.23 per common share, a 5% increase over the previous quarterly dividend of $0.22 per common share. The latest dividend was distributed on December 31, 2014, to stockholders of record as of December 15, 2014.
Louisville, Kentucky-based Stock Yards Bancorp, Inc., with $2.56 billion in assets, was incorporated in 1988 as a bank holding company. It is the parent company of Stock Yards Bank & Trust Company, which was established in 1904. The Company's common shares trade on the NASDAQ Global Select Market under the symbol SYBT.
The following table provides a reconciliation of total stockholders' equity, in accordance with US GAAP, to tangible common equity, which is a non-GAAP financial measure. The Company provides the tangible common equity ratio, in addition to those defined by banking regulators, because of its widespread use by investors as a means to evaluate capital adequacy.
| Tangible Common Equity Ratio (Dollars in thousands) |
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| | Dec. 31, 2014 | | Sept. 30, 2014 | | Dec. 31, 2013 |
| Total stockholders' equity (a) | | $ | 259,895 | | | $ | 251,446 | | | $ | 229,444 | |
| Less goodwill | | | (682 | ) | | | (682 | ) | | | (682 | ) |
| Less core deposit intangible | | | (1,820 | ) | | | (1,878 | ) | | | (2,151 | ) |
| Tangible common equity (c) | | $ | 257,393 | | | $ | 248,886 | | | $ | 226,611 | |
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| Total assets (b) | | $ | 2,563,868 | | | $ | 2,407,871 | | | $ | 2,389,262 | |
| Less goodwill | | | (682 | ) | | | (682 | ) | | | (682 | ) |
| Less core deposit intangible | | | (1,820 | ) | | | (1,878 | ) | | | (2,151 | ) |
| Tangible assets (d) | | $ | 2,561,366 | | | $ | 2,405,311 | | | $ | 2,386,429 | |
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| Total stockholders' equity to total assets (a/b) | | | 10.14 | % | | | 10.44 | % | | | 9.60 | % |
| Tangible common equity ratio (c/d) | | | 10.05 | % | | | 10.35 | % | | | 9.50 | % |
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The following table provides a reconciliation of net interest margin in accordance with US GAAP to core net interest margin, which is a non-GAAP financial measure. The Company provides this information to illustrate sequentially the trend in quarterly net interest margin to show the impact of prepayment fees and late charges on net interest margin.
| Reconciliation of Net Interest Margin to Core |
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| | Dec. 31, 2014 | | Sept. 30, 2014 | | June 30, 2014 | | March 31, 2014 | | Dec. 31, 2013 |
| Net interest margin | | 3.67 | % | | 3.80 | % | | 3.77 | % | | 3.76 | % | | 3.61 | % |
Prepayment penalties / late charges | | (0.01 | ) | | (0.06 | ) | | (0.02 | ) | | (0.02 | ) | | (0.06 | ) |
| Interest adjustment on non-accrual loans | | (0.01 | ) | | 0.01 | | | -- | | | 0.01 | | | -- | |
| Accretion of fair value adjustments | | (0.01 | ) | | (0.02 | ) | | (0.02 | ) | | (0.03 | ) | | (0.02 | ) |
| Core net interest margin | | 3.64 | % | | 3.73 | % | | 3.73 | % | | 3.72 | % | | 3.53 | % |
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This report contains forward-looking statements under the Private Securities Litigation Reform Act that involve risks and uncertainties. Although the Company's management believes the assumptions underlying the forward-looking statements contained herein are reasonable, any of these assumptions could be inaccurate. Therefore, there can be no assurance the forward-looking statements included herein will prove to be accurate. Factors that could cause actual results to differ from those discussed in forward-looking statements include, but are not limited to: economic conditions both generally and more specifically in the markets in which the Company and its subsidiaries operate; competition for the Company's customers from other providers of financial services; government legislation and regulation, which change from time to time and over which the Company has no control; changes in interest rates; material unforeseen changes in liquidity, results of operations, or financial condition of the Company's customers; and other risks detailed in the Company's filings with the Securities and Exchange Commission, all of which are difficult to predict and many of which are beyond the control of the Company. See Risk Factors outlined in the Company's Form 10-K for the year ended December 31, 2013.
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| Stock Yards Bancorp, Inc. Financial Information (unaudited) |
| Fourth Quarter 2014 Earnings Release |
| (In thousands unless otherwise noted) |
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| | Three Months Ended | | Twelve Months Ended |
| | December 31, | | December 31, |
| | 2014 | | 2013 | | 2014 | | 2013 |
| Income Statement Data | | | | | | | | |
| Net interest income, fully tax equivalent (1) | | $ | 21,749 | | $ | 20,096 | | $ | 84,730 | | | $ | 78,306 | |
| Interest income: | | | | | | | | |
| Loans | | $ | 20,309 | | $ | 19,941 | | $ | 79,884 | | | $ | 78,703 | |
| Federal funds sold | | | 77 | | | 80 | | | 292 | | | | 295 | |
| Mortgage loans held for sale | | | 46 | | | 42 | | | 174 | | | | 219 | |
| Securities | | | 2,346 | | | 2,006 | | | 8,737 | | | | 7,247 | |
| Total interest income | | | 22,778 | | | 22,069 | | | 89,087 | | | | 86,464 | |
| Interest expense: | | | | | | | | |
| Deposits | | | 1,002 | | | 1,178 | | | 4,321 | | | | 5,011 | |
| Federal funds purchased | | | 6 | | | 6 | | | 29 | | | | 32 | |
| Securities sold under agreements to repurchase | | | 40 | | | 40 | | | 140 | | | | 146 | |
| Federal Home Loan Bank (FHLB) advances | | | 219 | | | 230 | | | 840 | | | | 887 | |
| Subordinated debentures | | | - | | | 772 | | | - | | | | 3,090 | |
| Total interest expense | | | 1,267 | | | 2,226 | | | 5,330 | | | | 9,166 | |
| Net interest income | | | 21,511 | | | 19,843 | | | 83,757 | | | | 77,298 | |
| Provision for loan losses | | | - | | | 1,575 | | | (400 | ) | | | 6,550 | |
| Net interest income after provision for loan losses | | | 21,511 | | | 18,268 | | | 84,157 | | | | 70,748 | |
| Non-interest income: | | | | | | | | |
| Investment management and trust income | | | 4,387 | | | 4,255 | | | 18,212 | | | | 16,287 | |
| Service charges on deposit accounts | | | 2,263 | | | 2,394 | | | 8,883 | | | | 8,986 | |
| Bankcard transaction revenue | | | 1,207 | | | 1,310 | | | 4,673 | | | | 4,378 | |
| Mortgage banking revenue | | | 702 | | | 608 | | | 2,653 | | | | 3,978 | |
| Loss on the sale of securities | | | - | | - | | (9 | ) | | | (5 | ) |
| Brokerage commissions and fees | | | 554 | | | 466 | | | 2,060 | | | | 2,159 | |
| Bank owned life insurance | | | 228 | | | 260 | | | 927 | | | | 1,031 | |
| Gain on acquisition | | | - | | - | | - | | | | 449 | |
| Other non-interest income | | | 432 | | | 518 | | | 1,756 | | | | 1,739 | |
| Total non-interest income | | | 9,773 | | | 9,811 | | | 39,155 | | | | 39,002 | |
| Non-interest expense: | | | | | | | | |
| Salaries and employee benefits expense | | | 10,990 | | | 10,959 | | | 44,687 | | | | 41,145 | |
| Net occupancy expense | | | 1,532 | | | 1,427 | | | 5,963 | | | | 5,615 | |
| Data processing expense | | | 1,524 | | | 1,624 | | | 6,393 | | | | 6,319 | |
| Furniture and equipment expense | | | 220 | | | 280 | | | 1,016 | | | | 1,126 | |
| FDIC insurance expense | | | 282 | | | 376 | | | 1,314 | | | | 1,431 | |
| Loss (gain) on other real estate owned | | | 71 | | | 287 | | | (271 | ) | | | 652 | |
| Acquisition costs | | | - | | - | | - | | | | 1,548 | |
| Other non-interest expenses | | | 4,636 | | | 4,427 | | | 14,107 | | | | 13,516 | |
| Total non-interest expense | | | 19,255 | | | 19,380 | | | 73,209 | | | | 71,352 | |
| Net income before income tax expense | | | 12,029 | | | 8,699 | | | 50,103 | | | | 38,398 | |
| Income tax expense | | | 3,307 | | | 2,386 | | | 15,281 | | | | 11,228 | |
| Net income | | $ | 8,722 | | $ | 6,313 | | $ | 34,822 | | | $ | 27,170 | |
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| Weighted average shares - basic | | | 14,610 | | | 14,455 | | | 14,559 | | | | 14,223 | |
| Weighted average shares - diluted | | | 14,823 | | | 14,677 | | | 14,762 | | | | 14,353 | |
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| Net income per share, basic | | $ | 0.60 | | $ | 0.44 | | $ | 2.39 | | | $ | 1.91 | |
| Net income per share, diluted | | | 0.59 | | | 0.43 | | | 2.36 | | | | 1.89 | |
| Cash dividend declared per share | | | 0.23 | | | 0.21 | | | 0.88 | | | | 0.81 | |
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| Balance Sheet Data (at period end) | | | | | | | | |
| Total loans | | | | | | $ | 1,868,550 | | | $ | 1,721,350 | |
| Allowance for loan losses | | | | | | | 24,920 | | | | 28,522 | |
| Total assets | | | | | | | 2,563,868 | | | | 2,389,262 | |
| Non-interest bearing deposits | | | | | | | 523,947 | | | | 423,350 | |
| Interest bearing deposits | | | | | | | 1,599,680 | | | | 1,557,587 | |
| Federal Home Loan Bank advances | | | | | | | 36,832 | | | | 34,329 | |
| Stockholders' equity | | | | | | | 259,895 | | | | 229,444 | |
| Total shares outstanding | | | | | | | 14,745 | | | | 14,609 | |
| Book value per share | | | | | | | 17.63 | | | | 15.71 | |
| Market value per share | | | | | | | 33.34 | | | | 31.92 | |
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| Stock Yards Bancorp, Inc. Financial Information (unaudited) |
| Fourth Quarter 2014 Earnings Release |
| | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | December 31, | | December 31, |
| | 2014 | | 2013 | | 2014 | | 2013 |
| Average Balance Sheet Data | | | | | | | | |
| Average federal funds sold | | $ | 107,419 | | | $ | 116,348 | | | $ | 91,970 | | | $ | 99,381 | |
| Average mortgage loans held for sale | | | 4,301 | | | | 3,582 | | | | 4,120 | | | | 5,885 | |
| Average securities available for sale | | | 425,749 | | | | 378,575 | | | | 392,898 | | | | 337,119 | |
| Average FHLB stock and other securities | | | 6,347 | | | | 7,347 | | | | 6,755 | | | | 6,916 | |
| Average loans | | | 1,815,798 | | | | 1,713,062 | | | | 1,773,011 | | | | 1,656,777 | |
| Average earning assets | | | 2,351,442 | | | | 2,208,575 | | | | 2,259,843 | | | | 2,096,088 | |
| Average assets | | | 2,492,859 | | | | 2,351,127 | | | | 2,398,430 | | | | 2,232,868 | |
| Average interest bearing deposits | | | 1,566,411 | | | | 1,513,067 | | | | 1,548,738 | | | | 1,439,313 | |
| Average total deposits | | | 2,085,692 | | | | 1,949,209 | | | | 2,010,823 | | | | 1,843,426 | |
Average securities sold under agreement to repurchase | | | 68,597 | | | | 66,244 | | | | 61,748 | | | | 60,737 | |
Average federal funds purchased and other short term borrowings | | | 16,299 | | | | 17,102 | | | | 18,211 | | | | 19,546 | |
| Average Federal Home Loan Bank advances | | | 36,862 | | | | 34,341 | | | | 35,709 | | | | 32,518 | |
| Average subordinated debentures | | | - | | | | 29,221 | | | | - | | | | 30,477 | |
| Average interest bearing liabilities | | | 1,688,169 | | | | 1,659,975 | | | | 1,664,406 | | | | 1,582,591 | |
| Average stockholders' equity | | | 257,047 | | | | 229,685 | | | | 245,425 | | | | 220,107 | |
| | | | | | | | |
| Performance Ratios | | | | | | | | |
| Annualized return on average assets | | | 1.39 | % | | | 1.07 | % | | | 1.45 | % | | | 1.22 | % |
| Annualized return on average equity | | | 13.46 | % | | | 10.90 | % | | | 14.19 | % | | | 12.34 | % |
| Net interest margin, fully tax equivalent | | | 3.67 | % | | | 3.61 | % | | | 3.75 | % | | | 3.74 | % |
Non-interest income to total revenue, fully tax equivalent | | | 31.00 | % | | | 32.81 | % | | | 31.61 | % | | | 33.25 | % |
| Efficiency ratio | | | 61.08 | % | | | 64.80 | % | | | 59.09 | % | | | 60.82 | % |
| | | | | | | | |
| Capital Ratios | | | | | | | | |
| Average stockholders' equity to average assets | | | 10.31 | % | | | 9.77 | % | | | 10.23 | % | | | 9.86 | % |
| Tier 1 risk-based capital | | | | | | | 12.63 | % | | | 12.29 | % |
| Total risk-based capital | | | | | | | 13.86 | % | | | 13.54 | % |
| Leverage | | | | | | | 10.26 | % | | | 9.75 | % |
| | | | | | | | |
| Loans by Type | | | | | | | | |
| Commercial and industrial | | | | | | $ | 577,911 | | | $ | 510,739 | |
| Construction and development | | | | | | | 118,001 | | | | 129,590 | |
| Real estate mortgage - commercial investment | | | | | | | 487,822 | | | | 430,047 | |
| Real estate mortgage - owner occupied commercial | | | | | | | 340,982 | | | | 329,422 | |
| Real estate mortgage - 1-4 family residential | | | | | | | 195,102 | | | | 183,700 | |
| Home equity - first lien | | | | | | | 43,779 | | | | 40,251 | |
| Home equity - junior lien | | | | | | | 66,268 | | | | 63,403 | |
| Consumer | | | | | | | 38,685 | | | | 34,198 | |
| | | | | | | | |
| Asset Quality Data | | | | | | | | |
| Allowance for loan losses to total loans | | | | | | | 1.33 | % | | | 1.66 | % |
| Allowance for loan losses to average loans | | | 1.37 | % | | | 1.66 | % | | | 1.41 | % | | | 1.72 | % |
| Allowance for loan losses to non-performing loans | | | | | | | 209.76 | % | | | 124.31 | % |
| Nonaccrual loans | | | | | | $ | 5,199 | | | $ | 15,258 | |
| Troubled debt restructuring | | | | | | | 6,352 | | | | 7,249 | |
| Loans - 90 days past due & still accruing | | | | | | | 329 | | | | 437 | |
| Total non-performing loans | | | | | | | 11,880 | | | | 22,944 | |
| OREO and repossessed assets | | | | | | | 5,977 | | | | 5,592 | |
| Total non-performing assets | | | | | | | 17,857 | | | | 28,536 | |
| Non-performing loans to total loans | | | | | | | 0.64 | % | | | 1.33 | % |
| Non-performing assets to total assets | | | | | | | 0.70 | % | | | 1.19 | % |
| Net charge-offs to average loans (2) | | | 0.12 | % | | | 0.12 | % | | | 0.18 | % | | | 0.60 | % |
| Net charge-offs | | $ | 2,204 | | | $ | 2,043 | | | $ | 3,202 | | | $ | 9,909 | |
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| Stock Yards Bancorp, Inc. Financial Information (unaudited) |
| Fourth Quarter 2014 Earnings Release |
| | | | | | | | | | |
| | Five Quarter Comparison |
| | 12/31/14 | | 9/30/14 | | 6/30/14 | | 3/31/14 | | 12/31/13 |
| Income Statement Data | | | | | | | | | | |
| Net interest income, fully tax equivalent (1) | | $ | 21,749 | | | $ | 21,604 | | | $ | 20,900 | | | $ | 20,477 | | | $ | 20,096 | |
| Net interest income | | $ | 21,511 | | | $ | 21,363 | | | $ | 20,655 | | | $ | 20,228 | | | $ | 19,843 | |
| Provision for loan losses | | | - | | | | (2,100 | ) | | | 1,350 | | | | 350 | | | | 1,575 | |
| Net interest income after provision for loan losses | | | 21,511 | | | | 23,463 | | | | 19,305 | | | | 19,878 | | | | 18,268 | |
| Investment management and trust income | | | 4,387 | | | | 4,502 | | | | 4,755 | | | | 4,568 | | | | 4,255 | |
| Service charges on deposit accounts | | | 2,263 | | | | 2,294 | | | | 2,223 | | | | 2,103 | | | | 2,394 | |
| Bankcard transaction revenue | | | 1,207 | | | | 1,182 | | | | 1,209 | | | | 1,075 | | | | 1,310 | |
| Mortgage banking revenue | | | 702 | | | | 641 | | | | 722 | | | | 588 | | | | 608 | |
| Loss on the sale of securities | | | - | | | - | | (9 | ) | | | - | | | | - | |
| Brokerage commissions and fees | | | 554 | | | | 539 | | | | 462 | | | | 505 | | | | 466 | |
| Bank owned life insurance | | | 228 | | | | 229 | | | | 234 | | | | 236 | | | | 260 | |
| Other non-interest income | | | 432 | | | | 463 | | | | 461 | | | | 400 | | | | 518 | |
| Total non-interest income | | | 9,773 | | | | 9,850 | | | | 10,057 | | | | 9,475 | | | | 9,811 | |
| Salaries and employee benefits expense | | | 10,990 | | | | 11,855 | | | | 10,724 | | | | 11,118 | | | | 10,959 | |
| Net occupancy expense | | | 1,532 | | | | 1,422 | | | | 1,453 | | | | 1,556 | | | | 1,427 | |
| Data processing expense | | | 1,524 | | | | 1,591 | | | | 1,718 | | | | 1,560 | | | | 1,624 | |
| Furniture and equipment expense | | | 220 | | | | 269 | | | | 259 | | | | 268 | | | | 280 | |
| FDIC Insurance expense | | | 282 | | | | 340 | | | | 350 | | | | 342 | | | | 376 | |
| Loss (gain) on other real estate owned | | | 71 | | | | 7 | | | | (6 | ) | | | (343 | ) | | | 287 | |
| Other non-interest expenses | | | 4,636 | | | | 3,225 | | | | 3,203 | | | | 3,043 | | | | 4,427 | |
| Total non-interest expense | | | 19,255 | | | | 18,709 | | | | 17,701 | | | | 17,544 | | | | 19,380 | |
| Net income before income tax expense | | | 12,029 | | | | 14,604 | | | | 11,661 | | | | 11,809 | | | | 8,699 | |
| Income tax expense | | | 3,307 | | | | 4,715 | | | | 3,627 | | | | 3,632 | | | | 2,386 | |
| Net income | | $ | 8,722 | | | $ | 9,889 | | | $ | 8,034 | | | $ | 8,177 | | | $ | 6,313 | |
| | | | | | | | | | |
| Weighted average shares - basic | | | 14,610 | | | | 14,574 | | | | 14,545 | | | | 14,506 | | | | 14,455 | |
| Weighted average shares - diluted | | | 14,823 | | | | 14,748 | | | | 14,704 | | | | 14,701 | | | | 14,677 | |
| | | | | | | | | | |
| Net income per share, basic | | $ | 0.60 | | | $ | 0.68 | | | $ | 0.55 | | | $ | 0.56 | | | $ | 0.44 | |
| Net income per share, diluted | | | 0.59 | | | | 0.67 | | | | 0.55 | | | | 0.56 | | | | 0.43 | |
| Cash dividend declared per share | | | 0.23 | | | | 0.22 | | | | 0.22 | | | | 0.21 | | | | 0.21 | |
| | | | | | | | | | |
| Balance Sheet Data (at period end) | | | | | | | | | | |
| Cash and due from banks | | $ | 42,216 | | | $ | 38,302 | | | $ | 57,365 | | | $ | 42,685 | | | $ | 34,519 | |
| Federal funds sold | | | 32,025 | | | | 31,265 | | | | 37,896 | | | | 40,269 | | | | 36,251 | |
| Mortgage loans held for sale | | | 3,747 | | | | 4,069 | | | | 4,162 | | | | 3,473 | | | | 1,757 | |
| Securities available for sale | | | 513,056 | | | | 449,572 | | | | 414,490 | | | | 440,184 | | | | 490,031 | |
| FHLB stock and other securities | | | 6,347 | | | | 6,347 | | | | 6,347 | | | | 7,347 | | | | 7,347 | |
| Total loans | | | 1,868,550 | | | | 1,785,320 | | | | 1,799,791 | | | | 1,728,619 | | | | 1,721,350 | |
| Allowance for loan losses | | | 24,920 | | | | 27,124 | | | | 29,761 | | | | 28,591 | | | | 28,522 | |
| Total assets | | | 2,563,868 | | | | 2,407,871 | | | | 2,411,375 | | | | 2,354,238 | | | | 2,389,262 | |
| Non-interest bearing deposits | | | 523,947 | | | | 491,677 | | | | 462,379 | | | | 436,843 | | | | 423,350 | |
| Interest bearing deposits | | | 1,599,680 | | | | 1,516,144 | | | | 1,525,016 | | | | 1,550,544 | | | | 1,557,587 | |
| Securities sold under agreements to repurchase | | | 69,559 | | | | 66,955 | | | | 56,475 | | | | 52,453 | | | | 62,615 | |
| Federal funds purchased | | | 47,390 | | | | 16,296 | | | | 59,014 | | | | 18,731 | | | | 55,295 | |
| Federal Home Loan Bank advances | | | 36,832 | | | | 36,919 | | | | 36,067 | | | | 34,288 | | | | 34,329 | |
| Stockholders' equity | | | 259,895 | | | | 251,446 | | | | 243,614 | | | | 236,976 | | | | 229,444 | |
| Total shares outstanding | | | 14,745 | | | | 14,704 | | | | 14,665 | | | | 14,659 | | | | 14,609 | |
| Book value per share | | | 17.63 | | | | 17.10 | | | | 16.61 | | | | 16.17 | | | | 15.71 | |
| Market value per share | | | 33.34 | | | | 30.10 | | | | 29.90 | | | | 31.64 | | | | 31.92 | |
| | | | | | | | | | |
| Capital Ratios | | | | | | | | | | |
| Average stockholders' equity to average assets | | | 10.31 | % | | | 10.37 | % | | | 10.24 | % | | | 10.00 | % | | | 9.77 | % |
| Tier 1 risk-based capital | | | 12.63 | % | | | 12.67 | % | | | 12.28 | % | | | 12.47 | % | | | 12.29 | % |
| Total risk-based capital | | | 13.86 | % | | | 13.92 | % | | | 13.53 | % | | | 13.72 | % | | | 13.54 | % |
| Leverage | | | 10.26 | % | | | 10.38 | % | | | 10.19 | % | | | 10.00 | % | | | 9.75 | % |
| | | | | | | | | | |
| |
| Stock Yards Bancorp, Inc. Financial Information (unaudited) |
| Fourth Quarter 2014 Earnings Release |
| | | | | | | | | | |
| | Five Quarter Comparison |
| | 12/31/14 | | 9/30/14 | | 6/30/14 | | 3/31/14 | | 12/31/13 |
| Average Balance Sheet Data | | | | | | | | | | |
| Average federal funds sold | | $ | 107,419 | | | $ | 86,252 | | | $ | 77,386 | | | $ | 96,770 | | | $ | 116,348 | |
| Average mortgage loans held for sale | | | 4,301 | | | | 4,934 | | | | 4,438 | | | | 2,783 | | | | 3,582 | |
| Average investment securities | | | 425,749 | | | | 380,202 | | | | 382,176 | | | | 390,481 | | | | 385,922 | |
| Average loans | | | 1,815,798 | | | | 1,788,786 | | | | 1,759,695 | | | | 1,726,610 | | | | 1,713,062 | |
| Average earning assets | | | 2,351,442 | | | | 2,257,679 | | | | 2,221,482 | | | | 2,207,209 | | | | 2,208,575 | |
| Average assets | | | 2,492,859 | | | | 2,395,274 | | | | 2,357,697 | | | | 2,346,314 | | | | 2,351,127 | |
| Average interest bearing deposits | | | 1,566,411 | | | | 1,525,964 | | | | 1,550,363 | | | | 1,552,310 | | | | 1,513,067 | |
| Average total deposits | | | 2,085,692 | | | | 2,000,477 | | | | 1,982,180 | | | | 1,973,827 | | | | 1,949,209 | |
Average securities sold under agreement to repurchase | | | 68,597 | | | | 64,985 | | | | 52,396 | | | | 60,895 | | | | 66,244 | |
Average federal funds purchased and other short term borrowings | | | 16,299 | | | | 17,789 | | | | 22,109 | | | | 16,654 | | | | 17,102 | |
| Average Federal Home Loan Bank advances | | | 36,862 | | | | 36,747 | | | | 34,886 | | | | 34,302 | | | | 34,341 | |
| Average subordinated debentures | | | - | | | - | | - | | | | - | | | | 29,221 | |
| Average interest bearing liabilities | | | 1,688,169 | | | | 1,645,485 | | | | 1,659,754 | | | | 1,664,161 | | | | 1,659,975 | |
| Average stockholders' equity | | | 257,047 | | | | 248,412 | | | | 241,376 | | | | 234,587 | | | | 229,685 | |
| | | | | | | | | | |
| Performance Ratios | | | | | | | | | | |
| Annualized return on average assets | | | 1.39 | % | | | 1.64 | % | | | 1.37 | % | | | 1.41 | % | | | 1.07 | % |
| Annualized return on average equity | | | 13.46 | % | | | 15.79 | % | | | 13.35 | % | | | 14.14 | % | | | 10.90 | % |
| Net interest margin, fully tax equivalent | | | 3.67 | % | | | 3.80 | % | | | 3.77 | % | | | 3.76 | % | | | 3.61 | % |
Non-interest income to total revenue, fully tax equivalent | | | 31.00 | % | | | 31.32 | % | | | 32.49 | % | | | 31.63 | % | | | 32.81 | % |
| Efficiency ratio | | | 61.08 | % | | | 59.48 | % | | | 57.18 | % | | | 58.57 | % | | | 64.80 | % |
| | | | | | | | | | |
| Loans by Type | | | | | | | | | | |
| Commercial and industrial | | $ | 577,911 | | | $ | 550,487 | | | $ | 558,720 | | | $ | 511,247 | | | $ | 510,739 | |
| Construction and development | | | 118,001 | | | | 121,141 | | | | 124,390 | | | | 117,317 | | | | 129,590 | |
| Real estate mortgage - commercial investment | | | 487,822 | | | | 445,512 | | | | 458,101 | | | | 448,255 | | | | 430,047 | |
| Real estate mortgage - owner occupied commercial | | | 340,982 | | | | 343,218 | | | | 334,016 | | | | 329,260 | | | | 329,422 | |
| Real estate mortgage - 1-4 family residential | | | 195,102 | | | | 192,282 | | | | 189,192 | | | | 185,775 | | | | 183,700 | |
| Home equity - 1st lien | | | 43,779 | | | | 39,344 | | | | 39,050 | | | | 40,700 | | | | 40,251 | |
| Home equity - junior lien | | | 66,268 | | | | 65,181 | | | | 64,162 | | | | 62,605 | | | | 63,403 | |
| Consumer | | | 38,685 | | | | 28,155 | | | | 32,160 | | | | 33,460 | | | | 34,198 | |
| | | | | | | | | | |
| Asset Quality Data | | | | | | | | | | |
| Allowance for loan losses to total loans | | | 1.33 | % | | | 1.52 | % | | | 1.65 | % | | | 1.65 | % | | | 1.66 | % |
| Allowance for loan losses to average loans | | | 1.37 | % | | | 1.52 | % | | | 1.69 | % | | | 1.66 | % | | | 1.66 | % |
| Allowance for loan losses to non-performing loans | | | 209.76 | % | | | 132.26 | % | | | 153.00 | % | | | 139.74 | % | | | 124.31 | % |
| Nonaccrual loans | | $ | 5,199 | | | $ | 13,845 | | | $ | 11,985 | | | $ | 12,741 | | | $ | 15,258 | |
| Troubled debt restructuring | | | 6,352 | | | | 6,456 | | | | 7,118 | | | | 7,280 | | | | 7,249 | |
| Loans - 90 days past due & still accruing | | | 329 | | | | 207 | | | | 348 | | | | 439 | | | | 437 | |
| Total non-performing loans | | | 11,880 | | | | 20,508 | | | | 19,451 | | | | 20,460 | | | | 22,944 | |
| OREO and repossessed assets | | | 5,977 | | | | 2,768 | | | | 2,968 | | | | 2,935 | | | | 5,592 | |
| Total non-performing assets | | | 17,857 | | | | 23,276 | | | | 22,419 | | | | 23,395 | | | | 28,536 | |
| Non-performing loans to total loans | | | 0.64 | % | | | 1.15 | % | | | 1.08 | % | | | 1.18 | % | | | 1.33 | % |
| Non-performing assets to total assets | | | 0.70 | % | | | 0.97 | % | | | 0.93 | % | | | 0.99 | % | | | 1.19 | % |
| Net charge-offs to average loans (2) | | | 0.12 | % | | | 0.03 | % | | | 0.01 | % | | | 0.02 | % | | | 0.12 | % |
| Net charge-offs | | $ | 2,204 | | | $ | 537 | | | $ | 180 | | | $ | 281 | | | $ | 2,043 | |
| | | | | | | | | | |
| Other Information | | | | | | | | | | |
| Total assets under management (in millions) | | $ | 2,271 | | | $ | 2,228 | | | $ | 2,360 | | | $ | 2,279 | | | $ | 2,229 | |
| Full-time equivalent employees | | | 524 | | | | 527 | | | | 528 | | | | 522 | | | | 519 | |
| | | | | | | | | | |
| (1) - Interest income on a fully tax equivalent basis includes the additional amount of interest income that would have been earned if investments in certain tax-exempt interest earning assets had been made in assets subject to federal, state and local taxes yielding the same after-tax income. |
| (2) - Interim ratios not annualized |
CONTACT:
Stock Yards Bancorp, Inc.
Nancy B. Davis, 502-625-9176
Executive Vice President and Chief Financial Officer
