• | Significant Unusual Income or Expense Item: During the three months ended September 30, 2019, the Company recorded the following unusual items: (1) the Company reduced FDIC insurance expense by $309,000 as the Company received a credit for prior premiums paid as the FDIC deposit insurance fund surpassed a specified level; and (2) the Company made valuation write-downs totaling $280,000 on two foreclosed asset relationships. |
• | Total Loans: Total gross loans (including the undisbursed portion of loans), excluding FDIC-assisted acquired loans and mortgage loans held for sale, increased $65.3 million, or 1.4%, from December 31, 2018, to September 30, 2019. This increase was primarily in commercial real estate loans, owner occupied one- to four-family residential loans and other residential (multi-family) loans. These increases were partially offset by decreases in construction loans and consumer auto loans. Total gross loans increased $23.1 million from June 30, 2019. The FDIC-acquired loan portfolios had net decreases totaling $25.6 million during the nine months ended September 30, 2019. Outstanding net loan receivable balances increased $167.7 million, from $3.99 billion at December 31, 2018 to $4.16 billion at September 30, 2019, and increased $44.2 million from June 30, 2019. |
• | Asset Quality: Non-performing assets and potential problem loans, excluding those acquired in FDIC-assisted transactions (which are accounted for and analyzed as loan pools rather than individual loans), totaled $13.4 million at September 30, 2019, a decrease of $7.5 million from $20.9 million at June 30, 2019. Non-performing assets at September 30, 2019 were $9.0 million (0.18% of total assets), down $6.9 million from $15.9 million (0.33% of total assets) at June 30, 2019. |
• | Net Interest Income: Net interest income for the third quarter of 2019 increased $2.9 million to $45.9 million compared to $43.0 million for the third quarter of 2018. Net interest income was $44.9 million for the second quarter of 2019. Net interest margin was 3.95% for the quarter ended September 30, 2019, compared to 4.02% for the third quarter of 2018 and 3.97% for the quarter ended June 30, 2019. The decrease in net interest margin compared to the second quarter of 2019 was due to a slight increase in the average interest rates paid on deposits and a decrease in the yield on investment securities and other interest-earning assets. The positive impact on net interest margin from the additional yield accretion on acquired loan pools that was recorded during the period was 20, 14 and 12 basis points for the quarters ended September 30, 2019, September 30, 2018, and June 30, 2019, respectively. For further discussion of the additional yield accretion of the discount on acquired loan pools, see “Net Interest Income.” |
• | Capital: The capital position of the Company continues to be strong, significantly exceeding the thresholds established by regulators. On a preliminary basis, as of September 30, 2019, the Company’s Tier 1 Leverage Ratio was 11.7%, Common Equity Tier 1 Capital Ratio was 11.7%, Tier 1 Capital Ratio was 12.2%, and Total Capital Ratio was 14.7%. |
(In thousands, except per share data) | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Net interest income | $ | 45,924 | $ | 42,985 | $ | 135,449 | $ | 123,636 | ||||||||
Provision for loan losses | 1,950 | 1,300 | 5,500 | 5,200 | ||||||||||||
Non-interest income | 8,655 | 14,604 | 23,263 | 28,998 | ||||||||||||
Non-interest expense | 28,725 | 28,309 | 85,602 | 86,537 | ||||||||||||
Provision for income taxes | 4,172 | 5,464 | 11,890 | 11,076 | ||||||||||||
Net income and net income available to common shareholders | $ | 19,732 | $ | 22,516 | $ | 55,720 | $ | 49,821 | ||||||||
Earnings per diluted common share | $ | 1.38 | $ | 1.57 | $ | 3.90 | $ | 3.49 |
Three Months Ended | ||||||||||
September 30, 2019 | September 30, 2018 | |||||||||
(In thousands, except basis points data) | ||||||||||
Impact on net interest income/ net interest margin (in basis points) | $ | 2,251 | 20 bps | $ | 1,424 | 14 bps | ||||
Net impact to pre-tax income | $ | 2,251 | $ | 1,424 | ||||||
Nine Months Ended | ||||||||||
September 30, 2019 | September 30, 2018 | |||||||||
(In thousands, except basis points data) | ||||||||||
Impact on net interest income/ net interest margin (in basis points) | $ | 5,162 | 15 bps | $ | 3,652 | 12 bps | ||||
Net impact to pre-tax income | $ | 5,162 | $ | 3,652 | ||||||
• | Gain on sale of business units: On July 20, 2018, the Company closed on the sale of four banking centers in the Omaha, Neb., metropolitan market. The Bank sold branch deposits of approximately $56 million and sold substantially all branch-related real estate, fixed assets and ATMs. The Company recorded a pre-tax gain of $7.4 million on the sale during the 2018 quarter. |
• | Other income: Other income increased $1.0 million compared to the prior year quarter. The Company recognized approximately $510,000 in income related to interest rate swaps in the Company’s back-to-back swap program with loan customers and swap counterparties. The Company also recognized approximately $184,000 in income related to the exit of certain tax credit partnerships in 2019. In addition, the Company recognized approximately $329,000 more in income from new debit card contracts than was recognized in the prior year period. These contracts became effective at the beginning of 2019. |
• | Net gains on loan sales: Net gains on loan sales increased $604,000 compared to the prior year quarter. The increase was due to an increase in originations of fixed-rate loans during the 2019 period compared to the 2018 period. Fixed rate single-family mortgage loans originated are generally subsequently sold in the secondary market. In 2019, the Company began originating SBA loans with the purpose of selling the guaranteed portion in the secondary market. During the 2019 third quarter, a net gain on sale of $108,000 was recorded related to SBA loan sales. |
• | Commissions: Commissions income decreased $136,000 compared to the prior year quarter. The decrease was due to annuity sales that were approximately 25% lower in the 2019 period compared to the 2018 period. |
• | Gain on sale of business units: On July 20, 2018, the Company closed on the sale of four banking centers in the Omaha, Neb., metropolitan market. The Bank sold branch deposits of approximately $56 million and sold substantially all branch-related real estate, fixed assets and ATMs. The Company recorded a pre-tax gain of $7.4 million on the sale during the 2018 period. |
• | Other income: Other income increased $2.4 million compared to the prior year period. This increase was primarily due to gains totaling $677,000 in the 2019 period from the sale of, or recovery of, receivables and assets that were acquired several years ago in FDIC-assisted transactions. In addition, the Company recognized approximately $1.1 million more in income as a result of the new debit card contracts noted previously. The Company recognized approximately $565,000 in income related to interest rate swaps in the Company’s back-to-back swap program with loan customers and swap counterparties in the 2019 period compared to $47,000 in the 2018 period. The Company also recognized approximately $184,000 in income related to the exit of certain tax credit partnerships in 2019. |
• | Service charges and ATM fees: Service charges and ATM fees decreased $304,000 compared to the prior year period. This decrease was primarily due to a decrease in overdraft and insufficient funds fees on customer accounts due to decreased levels of such activity. |
• | Net gains on loan sales: Net gains on loan sales increased $207,000 compared to the prior year period. This increase was primarily due to an increase in originations of fixed-rate loans during the 2019 period as discussed above and the Company’s origination of SBA loans with the purpose of selling the guaranteed portion in the secondary market. During the period, a net gain on sale of $108,000 was recorded related to SBA loan sales. |
• | Salaries and employee benefits: Salaries and employee benefits increased $665,000 from the prior year quarter. The increase was due to staffing additions in the new loan production offices opened in Atlanta and Denver in late 2018, and due to annual employee compensation increases. |
• | Insurance: Insurance expense decreased $343,000 from the prior year quarter. This decrease was primarily due to a decrease in FDIC deposit insurance premiums. The Bank has a credit with the FDIC for a portion of premiums previously paid to the deposit insurance fund. The deposit insurance fund balance was sufficient to cause no premium to be due for the three months ended September 30, 2019. The Bank’s remaining credit balance should be sufficient to result in no deposit insurance premiums for the next two quarters, provided the deposit insurance fund balance remains at a sufficient level under the banking regulations. |
• | Acquired deposit intangible asset amortization: Acquired deposit intangible amortization expense decreased $123,000 in the quarter ended September 30, 2019 compared to the prior year quarter. The Company generally amortizes its acquired deposit intangibles over a period of seven years. The amortization of the intangible related to the InterBank acquisition was completed during the first quarter of 2019 and the amortization of the intangible related to the Sun Security Bank acquisition was completed during the third quarter of 2018. |
• | Expense on other real estate owned and repossessions: Expense on other real estate owned and repossessions decreased $2.7 million compared to the prior year period primarily due to higher valuation write-downs of certain foreclosed assets and higher levels of expense related to consumer repossessions in the prior year period. During the 2018 period, valuation write-downs of certain foreclosed assets totaled approximately $3.6 million, while valuation write-downs in the 2019 period totaled approximately $724,000. |
| • | Acquired deposit intangible asset amortization: Acquired deposit intangible amortization expense decreased $335,000 in the nine months ended September 30, 2019 compared to the prior year period. The Company generally amortizes its acquired deposit intangibles over a period of seven years, as described above. |
| • | Insurance: Insurance decreased $335,000 from the prior year quarter. This decrease was primarily due to a decrease in FDIC deposit insurance premiums, as described above. |
| • | Salaries and employee benefits: Salaries and employee benefits increased $2.2 million from the prior year period. The increase was due to staffing additions in the new loan production offices opened in Atlanta and Denver in late 2018, and due to annual employee compensation increases. |
September 2019 | June 2019 | March 2019 | December 2018 | December 2017 | December 2016 | |||||||||||||||||||
Closed loans with unused available lines | ||||||||||||||||||||||||
Secured by real estate (one- to four-family) | $ | 152,828 | $ | 153,871 | $ | 154,400 | $ | 150,948 | $ | 133,587 | $ | 123,433 | ||||||||||||
Secured by real estate (not one- to four-family) | 20,003 | 13,237 | 10,450 | 11,063 | 10,836 | 26,062 | ||||||||||||||||||
Not secured by real estate - commercial business | 92,095 | 80,887 | 83,520 | 87,480 | 113,317 | 79,937 | ||||||||||||||||||
Closed construction loans with unused available lines | ||||||||||||||||||||||||
Secured by real estate (one-to four-family) | 38,323 | 28,023 | 33,818 | 37,162 | 20,919 | 10,047 | ||||||||||||||||||
Secured by real estate (not one-to four-family) | 773,375 | 818,047 | 831,155 | 906,006 | 718,277 | 542,326 | ||||||||||||||||||
Loan Commitments not closed | ||||||||||||||||||||||||
Secured by real estate (one-to four-family) | 55,989 | 49,694 | 36,945 | 24,253 | 23,340 | 15,884 | ||||||||||||||||||
Secured by real estate (not one-to four-family) | 176,138 | 110,647 | 134,607 | 104,871 | 156,658 | 119,126 | ||||||||||||||||||
Not secured by real estate - commercial business | 4,535 | 4,535 | — | 405 | 4,870 | 7,022 | ||||||||||||||||||
$ | 1,313,286 | $ | 1,258,941 | $ | 1,284,895 | $ | 1,322,188 | $ | 1,181,804 | $ | 923,837 |
Beginning Balance, July 1 | Additions to Non- Performing | Removed from Non- Performing | Transfers to Potential Problem Loans | Transfers to Foreclosed Assets and Repossessions | Charge-Offs | Payments | Ending Balance, September 30 | |||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
One- to four-family construction | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Subdivision construction | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Land development | 3,556 | 42 | — | — | (3,498 | ) | — | (17 | ) | 83 | ||||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
One- to four-family residential | 1,532 | 429 | — | — | (290 | ) | — | (192 | ) | 1,479 | ||||||||||||||||||||||
Other residential | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Commercial real estate | 3,675 | — | (118 | ) | — | (2,900 | ) | — | (20 | ) | 637 | |||||||||||||||||||||
Commercial business | 1,359 | — | — | — | — | (91 | ) | (23 | ) | 1,245 | ||||||||||||||||||||||
Consumer | 1,266 | 421 | — | — | (64 | ) | (215 | ) | (186 | ) | 1,222 | |||||||||||||||||||||
Total | $ | 11,388 | $ | 892 | $ | (118 | ) | $ __— | $ | (6,752 | ) | $ | (306 | ) | $ | (438 | ) | $ | 4,666 |
Beginning Balance, July 1 | Additions to Potential Problem | Removed from Potential Problem | Transfers to Non- Performing | Transfers to Foreclosed Assets and Repossessions | Charge-Offs | Payments | Ending Balance, September 30 | |||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
One- to four-family construction | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Subdivision construction | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Land development | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
One- to four-family residential | 840 | 8 | — | — | — | — | (22 | ) | 826 | |||||||||||||||||||||||
Other residential | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Commercial real estate | 3,809 | — | — | — | — | — | (475 | ) | 3,334 | |||||||||||||||||||||||
Commercial business | 37 | — | — | — | — | (21 | ) | (16 | ) | — | ||||||||||||||||||||||
Consumer | 319 | — | — | — | — | — | (39 | ) | 280 | |||||||||||||||||||||||
Total | $ | 5,005 | $ | 8 | $ | — | $ | — | $ | — | $ | (21 | ) | $ | (552 | ) | $ | 4,440 | ||||||||||||||
Beginning Balance, July 1 | Additions | ORE and Repossession Sales | Capitalized Costs | ORE and Repossession Write-Downs | Ending Balance, September 30 | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
One-to four-family construction | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||
Subdivision construction | 918 | — | (236 | ) | 73 | --- | 755 | |||||||||||||||||
Land development | 2,584 | 3,498 | (3,208 | ) | — | (280 | ) | 2,594 | ||||||||||||||||
Commercial construction | — | — | — | — | — | — | ||||||||||||||||||
One- to four-family residential | — | 290 | --- | 20 | — | 310 | ||||||||||||||||||
Other residential | — | — | — | — | — | — | ||||||||||||||||||
Commercial real estate | — | 2,900 | (2,900 | ) | — | — | — | |||||||||||||||||
Commercial business | — | — | — | — | — | — | ||||||||||||||||||
Consumer | 999 | 1,006 | (1,340 | ) | — | — | 665 | |||||||||||||||||
Total | $ | 4,501 | $ | 7,694 | $ | (7,684 | ) | $ | 93 | $ | (280 | ) | $ | 4,324 |
September 30, | December 31, | |||||||
2019 | 2018 | |||||||
Selected Financial Condition Data: | (In thousands) | |||||||
Total assets | $ | 4,972,160 | $ | 4,676,200 | ||||
Loans receivable, gross | 4,203,885 | 4,034,810 | ||||||
Allowance for loan losses | 40,406 | 38,409 | ||||||
Other real estate owned, net | 7,444 | 8,440 | ||||||
Available-for-sale securities, at fair value | 349,020 | 243,968 | ||||||
Deposits | 3,935,154 | 3,725,007 | ||||||
Total borrowings | 393,627 | 397,594 | ||||||
Total common stockholders’ equity | 596,770 | 531,977 | ||||||
Non-performing assets (excluding FDIC-assisted transaction assets) | 8,990 | 11,780 |
Three Months Ended | Nine Months Ended | Three Months Ended | ||||||||||||||||||
September 30, | September 30, | June 30, | ||||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | ||||||||||||||||
Selected Operating Data: | (Dollars in thousands, except per share data) | |||||||||||||||||||
Interest income | $ | 60,187 | $ | 52,982 | $ | 176,267 | $ | 149,808 | $ | 58,723 | ||||||||||
Interest expense | 14,263 | 9,997 | 40,818 | 26,172 | 13,802 | |||||||||||||||
Net interest income | 45,924 | 42,985 | 135,449 | 123,636 | 44,921 | |||||||||||||||
Provision for loan losses | 1,950 | 1,300 | 5,500 | 5,200 | 1,600 | |||||||||||||||
Non-interest income | 8,655 | 14,604 | 23,263 | 28,998 | 7,157 | |||||||||||||||
Non-interest expense | 28,725 | 28,309 | 85,602 | 86,537 | 28,383 | |||||||||||||||
Provision for income taxes | 4,172 | 5,464 | 11,890 | 11,076 | 3,720 | |||||||||||||||
Net income and net income available to common shareholders | $ | 19,732 | $ | 22,516 | $ | 55,720 | $ | 49,821 | $ | 18,375 | ||||||||||
At or For the Three Months Ended | At or For the Nine Months Ended | At or For the Three Months Ended | ||||||||||||||||||
September 30, | September 30, | June 30, | ||||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | ||||||||||||||||
Per Common Share: | (Dollars in thousands, except per share data) | |||||||||||||||||||
Net income (fully diluted) | $ | 1.38 | $ | 1.57 | $ | 3.90 | $ | 3.49 | $ | 1.28 | ||||||||||
Book value | $ | 41.98 | $ | 35.90 | $ | 41.98 | $ | 35.90 | $ | 40.30 | ||||||||||
Earnings Performance Ratios: | ||||||||||||||||||||
Annualized return on average assets | 1.61 | % | 1.99 | % | 1.54 | % | 1.49 | % | 1.52 | % | ||||||||||
Annualized return on average common stockholders’ equity | 13.46 | % | 17.80 | % | 13.28 | % | 13.51 | % | 13.24 | % | ||||||||||
Net interest margin | 3.95 | % | 4.02 | % | 3.99 | % | 3.96 | % | 3.97 | % | ||||||||||
Average interest rate spread | 3.61 | % | 3.76 | % | 3.66 | % | 3.74 | % | 3.64 | % | ||||||||||
Efficiency ratio | 52.63 | % | 49.16 | % | 53.94 | % | 56.70 | % | 54.50 | % | ||||||||||
Non-interest expense to average total assets | 2.34 | % | 2.50 | % | 2.37 | % | 2.58 | % | 2.35 | % | ||||||||||
Asset Quality Ratios: | ||||||||||||||||||||
Allowance for loan losses to period-end loans (excluding covered/previously covered loans) | 0.99 | % | 1.00 | % | 0.99 | % | 1.00 | % | 0.97 | % | ||||||||||
Non-performing assets to period-end assets | 0.18 | % | 0.35 | % | 0.18 | % | 0.35 | % | 0.33 | % | ||||||||||
Non-performing loans to period-end loans | 0.11 | % | 0.16 | % | 0.11 | % | 0.16 | % | 0.27 | % | ||||||||||
Annualized net charge-offs to average loans | 0.08 | % | 0.14 | % | 0.11 | % | 0.14 | % | 0.10 | % |
September 30, 2019 | December 31, 2018 | June 30, 2019 | ||||||||||
Assets | ||||||||||||
Cash | $ | 105,068 | $ | 110,108 | $ | 99,567 | ||||||
Interest-bearing deposits in other financial institutions | 85,809 | 92,634 | 81,805 | |||||||||
Cash and cash equivalents | 190,877 | 202,742 | 181,372 | |||||||||
Available-for-sale securities | 349,020 | 243,968 | 305,649 | |||||||||
Mortgage loans held for sale | 10,819 | 1,650 | 11,106 | |||||||||
Loans receivable (1), net of allowance for loan losses of $40,406 – September 2019; $38,409 – December 2018; $39,254 – June 2019 | 4,156,703 | 3,989,001 | 4,112,455 | |||||||||
Interest receivable | 13,701 | 13,448 | 14,351 | |||||||||
Prepaid expenses and other assets | 82,218 | 55,336 | 76,241 | |||||||||
Other real estate owned and repossessions (2), net | 7,444 | 8,440 | 7,107 | |||||||||
Premises and equipment, net | 141,227 | 132,424 | 143,473 | |||||||||
Goodwill and other intangible assets | 8,386 | 9,288 | 8,675 | |||||||||
Federal Home Loan Bank stock | 11,765 | 12,438 | 11,093 | |||||||||
Current and deferred income taxes | — | 7,465 | — | |||||||||
Total Assets | $ | 4,972,160 | $ | 4,676,200 | $ | 4,871,522 | ||||||
Liabilities and Stockholders’ Equity | ||||||||||||
Liabilities | ||||||||||||
Deposits | $ | 3,935,154 | $ | 3,725,007 | $ | 3,888,536 | ||||||
Securities sold under reverse repurchase agreements with customers | 102,569 | 105,253 | 98,632 | |||||||||
Short-term borrowings | 191,116 | 192,725 | 168,636 | |||||||||
Subordinated debentures issued to capital trust | 25,774 | 25,774 | 25,774 | |||||||||
Subordinated notes | 74,168 | 73,842 | 74,059 | |||||||||
Accrued interest payable | 3,119 | 3,570 | 4,209 | |||||||||
Advances from borrowers for taxes and insurance | 10,405 | 5,092 | 10,550 | |||||||||
Accounts payable and accrued expenses | 27,048 | 12,960 | 26,499 | |||||||||
Current and deferred income taxes | 6,037 | — | 2,318 | |||||||||
Total Liabilities | 4,375,390 | 4,144,223 | 4,299,213 | |||||||||
Stockholders’ Equity | ||||||||||||
Capital stock | ||||||||||||
Preferred stock, $.01 par value; authorized 1,000,000 shares; issued and outstanding September 2019, December 2018 and June 2019– -0- shares | — | — | — | |||||||||
Common stock, $.01 par value; authorized 20,000,000 shares; issued and outstanding September 2019 – 14,214,054 shares; December 2018 – 14,151,198 shares; June 2019 – 14,201,616 shares | 142 | 142 | 142 | |||||||||
Additional paid-in capital | 32,085 | 30,121 | 31,603 | |||||||||
Retained earnings | 523,493 | 492,087 | 508,427 | |||||||||
Accumulated other comprehensive gain | 41,050 | 9,627 | 32,137 | |||||||||
Total Stockholders’ Equity | 596,770 | 531,977 | 572,309 | |||||||||
Total Liabilities and Stockholders’ Equity | $ | 4,972,160 | $ | 4,676,200 | $ | 4,871,522 |
(1) | At September 30, 2019, December 31, 2018 and June 30, 2019, includes loans, net of discounts, totaling $141.7 million, $167.6 million and $151.1 million, respectively, which were acquired in FDIC-assisted transactions and are accounted for under ASC 310-30. |
(2) | At September 30, 2019, December 31, 2018 and June 30, 2019, includes foreclosed assets, net of discounts, totaling $1.1 million, $1.4 million and $1.3 million, respectively, which were acquired in FDIC-assisted transactions. In addition, at September 30, 2019, December 31, 2018 and June 30, 2019, includes $2.0 million, $1.6 million and $1.3 million of properties which were not acquired through foreclosure, but are held for sale. |
Great Southern Bancorp, Inc. and Subsidiaries
Three Months Ended | Nine Months Ended | Three Months Ended | ||||||||||||||||||
September 30, | September 30, | June 30, | ||||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | ||||||||||||||||
Interest Income | ||||||||||||||||||||
Loans | $ | 57,226 | $ | 51,063 | $ | 167,552 | $ | 144,447 | $ | 55,771 | ||||||||||
Investment securities and other | 2,961 | 1,919 | 8,715 | 5,361 | 2,952 | |||||||||||||||
60,187 | 52,982 | 176,267 | 149,808 | 58,723 | ||||||||||||||||
Interest Expense | ||||||||||||||||||||
Deposits | 11,792 | 7,352 | 33,844 | 19,058 | 11,582 | |||||||||||||||
Federal Home Loan Bank advances | — | 1,192 | — | 2,964 | — | |||||||||||||||
Short-term borrowings and repurchase agreements | 1,123 | 177 | 2,904 | 385 | 859 | |||||||||||||||
Subordinated debentures issued to capital trust | 253 | 252 | 787 | 692 | 267 | |||||||||||||||
Subordinated notes | 1,095 | 1,024 | 3,283 | 3,073 | 1,094 | |||||||||||||||
14,263 | 9,997 | 40,818 | 26,172 | 13,802 | ||||||||||||||||
Net Interest Income | 45,924 | 42,985 | 135,449 | 123,636 | 44,921 | |||||||||||||||
Provision for Loan Losses | 1,950 | 1,300 | 5,500 | 5,200 | 1,600 | |||||||||||||||
Net Interest Income After Provision for Loan Losses | 43,974 | 41,685 | 129,949 | 118,436 | 43,321 | |||||||||||||||
Noninterest Income | ||||||||||||||||||||
Commissions | 173 | 309 | 670 | 868 | 163 | |||||||||||||||
Service charges and ATM fees | 5,619 | 5,458 | 15,887 | 16,191 | 5,309 | |||||||||||||||
Net gains on loan sales | 1,021 | 417 | 1,645 | 1,438 | 376 | |||||||||||||||
Net realized gains on sales of available-for-sale securities | — | 2 | 10 | 2 | — | |||||||||||||||
Late charges and fees on loans | 364 | 466 | 1,066 | 1,240 | 356 | |||||||||||||||
Gain (loss) on derivative interest rate products | (101 | ) | 5 | (169 | ) | 53 | (44 | ) | ||||||||||||
Gain on sale of business units | — | 7,414 | — | 7,414 | — | |||||||||||||||
Other income | 1,579 | 533 | 4,154 | 1,792 | 997 | |||||||||||||||
8,655 | 14,604 | 23,263 | 28,998 | 7,157 | ||||||||||||||||
Noninterest Expense | ||||||||||||||||||||
Salaries and employee benefits | 15,827 | 15,162 | 46,895 | 44,731 | 15,428 | |||||||||||||||
Net occupancy expense | 6,613 | 6,551 | 19,462 | 19,234 | 6,449 | |||||||||||||||
Postage | 792 | 843 | 2,342 | 2,544 | 784 | |||||||||||||||
Insurance | 339 | 682 | 1,667 | 2,002 | 662 | |||||||||||||||
Advertising | 794 | 589 | 2,162 | 1,892 | 842 | |||||||||||||||
Office supplies and printing | 258 | 255 | 743 | 789 | 226 | |||||||||||||||
Telephone | 904 | 827 | 2,645 | 2,339 | 839 | |||||||||||||||
Legal, audit and other professional fees | 681 | 875 | 2,023 | 2,373 | 630 | |||||||||||||||
Expense on other real estate and repossessions | 603 | 498 | 1,642 | 4,376 | 419 | |||||||||||||||
Partnership tax credit investment amortization | 91 | 91 | 274 | 484 | 91 | |||||||||||||||
Acquired deposit intangible asset amortization | 289 | 412 | 902 | 1,237 | 289 | |||||||||||||||
Other operating expenses | 1,534 | 1,524 | 4,845 | 4,536 | 1,724 | |||||||||||||||
28,725 | 28,309 | 85,602 | 86,537 | 28,383 | ||||||||||||||||
Income Before Income Taxes | 23,904 | 27,980 | 67,610 | 60,897 | 22,095 | |||||||||||||||
Provision for Income Taxes | 4,172 | 5,464 | 11,890 | 11,076 | 3,720 | |||||||||||||||
Net Income and Net Income Available to Common Shareholders | $ | 19,732 | $ | 22,516 | $ | 55,720 | $ | 49,821 | $ | 18,375 |
Earnings Per Common Share | ||||||||||||||||||||
Basic | $ | 1.39 | $ | 1.59 | $ | 3.93 | $ | 3.53 | $ | 1.29 | ||||||||||
Diluted | $ | 1.38 | $ | 1.57 | $ | 3.90 | $ | 3.49 | $ | 1.28 | ||||||||||
Dividends Declared Per Common Share | $ | 0.34 | $ | 0.32 | $ | 1.73 | $ | 0.88 | $ | 0.32 | ||||||||||
September 30, 2019(1) | Three Months Ended September 30, 2019 | Three Months Ended September 30, 2018 | ||||||||||||||||||||||||||
Average | Yield/ | Average | Yield/ | |||||||||||||||||||||||||
Yield/Rate | Balance | Interest | Rate | Balance | Interest | Rate | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||||||
Loans receivable: | ||||||||||||||||||||||||||||
One- to four-family residential | 4.20 | % | $ | 542,892 | $ | 7,153 | 5.23 | % | $ | 453,090 | $ | 5,939 | 5.20 | % | ||||||||||||||
Other residential | 5.08 | 814,326 | 11,074 | 5.40 | 782,595 | 10,163 | 5.15 | |||||||||||||||||||||
Commercial real estate | 4.93 | 1,471,431 | 19,236 | 5.19 | 1,330,088 | 16,427 | 4.90 | |||||||||||||||||||||
Construction | 5.36 | 730,027 | 10,814 | 5.88 | 593,540 | 8,272 | 5.53 | |||||||||||||||||||||
Commercial business | 5.08 | 253,225 | 3,316 | 5.20 | 291,038 | 3,689 | 5.03 | |||||||||||||||||||||
Other loans | 5.85 | 369,704 | 5,423 | 5.82 | 485,647 | 6,283 | 5.13 | |||||||||||||||||||||
Industrial revenue bonds | 4.86 | 14,770 | 210 | 5.64 | 19,829 | 290 | 5.80 | |||||||||||||||||||||
Total loans receivable | 5.11 | 4,196,375 | 57,226 | 5.41 | 3,955,827 | 51,063 | 5.12 | |||||||||||||||||||||
Investment securities | 3.23 | 342,277 | 2,534 | 2.94 | 193,390 | 1,425 | 2.92 | |||||||||||||||||||||
Other interest-earning assets | 2.02 | 79,344 | 427 | 2.13 | 97,739 | 494 | 2.01 | |||||||||||||||||||||
Total interest-earning assets | 4.90 | 4,617,996 | 60,187 | 5.17 | 4,246,956 | 52,982 | 4.95 | |||||||||||||||||||||
Non-interest-earning assets: | ||||||||||||||||||||||||||||
Cash and cash equivalents | 93,293 | 97,033 | ||||||||||||||||||||||||||
Other non-earning assets | 202,361 | 186,994 | ||||||||||||||||||||||||||
Total assets | $ | 4,913,650 | $ | 4,530,983 | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||
Interest-bearing demand and | ||||||||||||||||||||||||||||
savings | 0.55 | $ | 1,501,697 | 2,030 | 0.54 | $ | 1,506,907 | 1,523 | 0.40 | |||||||||||||||||||
Time deposits | 2.21 | 1,728,620 | 9,762 | 2.24 | 1,376,907 | 5,829 | 1.68 | |||||||||||||||||||||
Total deposits | 1.43 | 3,230,317 | 11,792 | 1.45 | 2,883,814 | 7,352 | 1.01 | |||||||||||||||||||||
Short-term borrowings and repurchase agreements | 1.36 | 289,222 | 1,123 | 1.54 | 141,864 | 177 | 0.49 | |||||||||||||||||||||
Subordinated debentures issued to capital trust | 3.85 | 25,774 | 253 | 3.90 | 25,774 | 252 | 3.88 | |||||||||||||||||||||
Subordinated notes | 5.90 | 74,119 | 1,095 | 5.86 | 73,791 | 1,024 | 5.51 | |||||||||||||||||||||
FHLB advances | — | — | — | — | 216,674 | 1,192 | 2.18 | |||||||||||||||||||||
Total interest-bearing liabilities | 1.53 | 3,619,432 | 14,263 | 1.56 | 3,341,917 | 9,997 | 1.19 | |||||||||||||||||||||
Non-interest-bearing liabilities: | ||||||||||||||||||||||||||||
Demand deposits | 670,158 | 660,629 | ||||||||||||||||||||||||||
Other liabilities | 37,754 | 22,428 | ||||||||||||||||||||||||||
Total liabilities | 4,327,344 | 4,024,974 | ||||||||||||||||||||||||||
Stockholders’ equity | 586,306 | 506,009 | ||||||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 4,913,650 | $ | 4,530,983 | ||||||||||||||||||||||||
Net interest income: | ||||||||||||||||||||||||||||
Interest rate spread | 3.37 | % | $ | 45,924 | 3.61 | % | $ | 42,985 | 3.76 | % | ||||||||||||||||||
Net interest margin* | 3.95 | % | 4.02 | % | ||||||||||||||||||||||||
Average interest-earning assets to average interest-bearing liabilities | 127.6 | % | 127.1 | % |
(1) | The yield on loans at September 30, 2019, does not include the impact of the adjustments to the accretable yield (income) on loans acquired in the FDIC-assisted transactions. See “Net Interest Income” for a discussion of the effect on results of operations for the three months ended September 30, 2019. |
September 30, 2019(1) | Nine Months Ended September 30, 2019 | Nine Months Ended September 30, 2018 | ||||||||||||||||||||||||||
Average | Yield/ | Average | Yield/ | |||||||||||||||||||||||||
Yield/Rate | Balance | Interest | Rate | Balance | Interest | Rate | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||||||
Loans receivable: | ||||||||||||||||||||||||||||
One- to four-family residential | 4.20 | % | $ | 518,758 | $ | 20,097 | 5.18 | % | $ | 440,769 | $ | 16,544 | 5.02 | % | ||||||||||||||
Other residential | 5.08 | 815,008 | 33,334 | 5.47 | 755,536 | 28,349 | 5.02 | |||||||||||||||||||||
Commercial real estate | 4.93 | 1,424,595 | 55,235 | 5.18 | 1,302,940 | 46,753 | 4.80 | |||||||||||||||||||||
Construction | 5.36 | 704,074 | 31,573 | 6.00 | 555,708 | 22,007 | 5.29 | |||||||||||||||||||||
Commercial business | 5.08 | 259,021 | 10,066 | 5.20 | 288,579 | 10,592 | 4.91 | |||||||||||||||||||||
Other loans | 5.85 | 403,176 | 16,576 | 5.50 | 511,735 | 19,170 | 5.01 | |||||||||||||||||||||
Industrial revenue bonds | 4.86 | 14,970 | 671 | 5.99 | 22,056 | 1,032 | 6.25 | |||||||||||||||||||||
Total loans receivable | 5.11 | 4,139,602 | 167,552 | 5.41 | 3,877,323 | 144,447 | 4.98 | |||||||||||||||||||||
Investment securities | 3.23 | 310,227 | 7,201 | 3.10 | 189,686 | 4,026 | 2.84 | |||||||||||||||||||||
Other interest-earning assets | 2.02 | 87,193 | 1,514 | 2.32 | 105,831 | 1,335 | 1.69 | |||||||||||||||||||||
Total interest-earning assets | 4.90 | 4,537,022 | 176,267 | 5.19 | 4,172,840 | 149,808 | 4.80 | |||||||||||||||||||||
Non-interest-earning assets: | ||||||||||||||||||||||||||||
Cash and cash equivalents | 92,208 | 98,879 | ||||||||||||||||||||||||||
Other non-earning assets | 191,296 | 194,441 | ||||||||||||||||||||||||||
Total assets | $ | 4,820,526 | $ | 4,466,160 | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||
Interest-bearing demand and | ||||||||||||||||||||||||||||
savings | 0.55 | $ | 1,491,255 | 5,723 | 0.51 | $ | 1,548,273 | 4,268 | 0.37 | |||||||||||||||||||
Time deposits | 2.21 | 1,711,692 | 28,121 | 2.20 | 1,331,098 | 14,790 | 1.49 | |||||||||||||||||||||
Total deposits | 1.43 | 3,202,947 | 33,844 | 1.41 | 2,879,371 | 19,058 | 0.88 | |||||||||||||||||||||
Short-term borrowings and repurchase agreements | 1.36 | 264,111 | 2,904 | 1.47 | 127,696 | 385 | 0.40 | |||||||||||||||||||||
Subordinated debentures issued to capital trust | 3.85 | 25,774 | 787 | 4.08 | 25,774 | 692 | 3.59 | |||||||||||||||||||||
Subordinated notes | 5.90 | 74,012 | 3,283 | 5.93 | 73,752 | 3,073 | 5.57 | |||||||||||||||||||||
FHLB advances | — | — | — | — | 198,778 | 2,964 | 1.99 | |||||||||||||||||||||
Total interest-bearing liabilities | 1.53 | 3,566,844 | 40,818 | 1.53 | 3,305,371 | 26,172 | 1.06 | |||||||||||||||||||||
Non-interest-bearing liabilities: | ||||||||||||||||||||||||||||
Demand deposits | 661,446 | 648,257 | ||||||||||||||||||||||||||
Other liabilities | 32,620 | 20,678 | ||||||||||||||||||||||||||
Total liabilities | 4,260,910 | 3,974,306 | ||||||||||||||||||||||||||
Stockholders’ equity | 559,616 | 491,854 | ||||||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 4,820,526 | $ | 4,466,160 | ||||||||||||||||||||||||
Net interest income: | ||||||||||||||||||||||||||||
Interest rate spread | 3.37 | % | $ | 135,449 | 3.66 | % | $ | 123,636 | 3.74 | % | ||||||||||||||||||
Net interest margin* | 3.99 | % | 3.96 | % | ||||||||||||||||||||||||
Average interest-earning assets to average interest-bearing liabilities | 127.2 | % | 126.2 | % |
(1) | The yield on loans at September 30, 2019, does not include the impact of the adjustments to the accretable yield (income) on loans acquired in the FDIC-assisted transactions. See “Net Interest Income” for a discussion of the effect on results of operations for the nine months ended September 30, 2019. |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||
Reported net interest income/ margin | $ | 45,924 | 3.95 | % | $ | 42,985 | 4.02 | % | $ | 135,449 | 3.99 | % | $ | 123,636 | 3.96 | % | ||||||||||||||||
Less: Impact of FDIC-acquired loan accretion adjustments | 2,251 | 0.20 | 1,424 | 0.14 | 5,162 | 0.15 | 3,652 | 0.12 | ||||||||||||||||||||||||
Core net interest income/ margin | $ | 43,673 | 3.75 | % | $ | 41,561 | 3.88 | % | $ | 130,287 | 3.84 | % | $ | 119,984 | 3.84 | % | ||||||||||||||||
September 30, | December 31, | |||||||
2019 | 2018 | |||||||
(Dollars in thousands) | ||||||||
Common equity at period end | $ | 596,770 | $ | 531,977 | ||||
Less: Intangible assets at period end | 8,386 | 9,288 | ||||||
Tangible common equity at period end (a) | $ | 588,384 | $ | 522,689 | ||||
Total assets at period end | $ | 4,972,160 | $ | 4,676,200 | ||||
Less: Intangible assets at period end | 8,386 | 9,288 | ||||||
Tangible assets at period end (b) | $ | 4,963,774 | $ | 4,666,912 | ||||
Tangible common equity to tangible assets (a) / (b) | 11.85 | % | 11.20 | % |