MOLINE, Ill., July 20, 2016 (GLOBE NEWSWIRE) -- QCR Holdings, Inc. (NASDAQ:QCRH) today announced net income of $6.7 million and diluted earnings per share (“EPS”) of $0.53 for the quarter ended June 30, 2016. This included $231 thousand of acquisition costs (after-tax) related to the previously announced acquisition of Community State Bank. By comparison, for the quarter ended March 31, 2016, the Company reported net income of $6.4 million and diluted EPS of $0.53. For the second quarter of 2015, the Company reported a net loss of $524 thousand, and diluted EPS of ($0.05), due to the successful completion of a balance sheet restructuring strategy.
For the six months ended June 30, 2016, the Company reported net income of $13.1 million, and diluted EPS of $1.07. By comparison, for the six months ended June 30, 2015, the Company reported net income of $3.7 million, and diluted EPS of $0.40.
“Our operating performance for the first half of 2016 has been solid,” commented Douglas M. Hultquist, President and Chief Executive Officer, “as fee income has been strong, organic loan growth continues to exceed expectations, and net interest margin expands further. Our return on average assets (“ROAA”) has improved to 1.01% for the current quarter. Although we have achieved our targeted ROAA of 1.00%, we expect to continue to enhance profitability through our ongoing key initiatives.”
Loan and Lease Growth Strong at 6.9% Year-To-Date
Swap Fee Income and Gains on the Sale of Government Guaranteed Loans Total $3.5 Million Year-To-Date
During the second quarter of 2016, the Company’s total assets increased $42.8 million, or 2%, to a total of $2.68 billion, while total loans and leases grew $49.0 million. The loan and lease growth was funded primarily by called securities and short-term borrowings. Deposits declined slightly during the quarter, while borrowings increased $34.0 million. Overnight FHLB borrowings increased $48.4 million, as this funding source is currently more cost effective than fed funds purchased.
“Loan and lease growth for the first six months of the year totaled $124.8 million, or an annualized rate of 13.9%,” commented Todd A. Gipple, Executive Vice President, Chief Operating Officer and Chief Financial Officer. “Continued loan and lease growth has helped us exceed our targeted annual organic growth rate of 10-12%, while also increasing our loan and lease to total asset ratio to 72%, from 71% as of the end of the first quarter of 2016 and from 67% one year ago.”
“Swap fee income and gains on the sale of government guaranteed loans are off to a very strong start for the first half of 2016, totaling $3.5 million,” said Mr. Gipple. “We plan to continue executing these types of transactions, as they provide unique and beneficial solutions for our clients.”
Net Interest Margin Expanded 3 Basis Points in Second Quarter
Net interest income totaled $21.0 million for the quarter ended June 30, 2016. By comparison, net interest income totaled $20.6 million and $18.5 million for the quarters ended March 31, 2016 and June 30, 2015, respectively. Net interest income totaled $41.6 million for the six months ended June 30, 2016, an increase of 14.7% from the same period of the prior year.
“Net interest margin increased 3 basis points from the prior quarter to 3.62%,” stated Mr. Gipple. He added, “We were successful in further improving asset yield by reinvesting the funds from called securities into both loans and higher yielding securities. The improvement created by this change in asset mix more than offset the 4 basis point decrease in loan yield experienced in the second quarter.”
Nonperforming Assets Flat During the Second Quarter
Nonperforming assets (“NPAs”) stayed relatively flat from the prior quarter and the ratio of NPAs to total assets was 0.70% at June 30, 2016, which was down from 0.71% at March 31, 2016 and down from 1.07% a year ago.
“Although NPAs remained relatively flat from the prior quarter, we remain committed to further improving our asset quality in 2016,” stated Mr. Hultquist.
The Company’s provision for loan and lease losses totaled $1.2 million for the second quarter of 2016, which was down $875 thousand from the prior quarter, and down $1.2 million compared to the second quarter of 2015. As asset quality remains strong, provision for loan and lease losses has moderated. As of June 30, 2016, the Company’s allowance to total loans and leases was 1.46%, which was flat from March 31, 2016 and down slightly from 1.52% at June 30, 2015.
Capital Levels Remain Strong
The Company’s total risk-based capital ratio was 14.23%, the common equity tier 1 ratio was 11.66% and the tangible common equity to tangible assets ratio increased to 10.10%, all as of June 30, 2016. For comparison, these respective ratios were 12.68%, 10.11% and 8.74% as of March 31, 2016. Both the total risk-based capital ratio and the common equity tier 1 ratio are well above the fully phased-in requirements under Basel III. The increase in the Company’s capital ratios was primarily due to the capital raise executed in the second quarter of 2016, as well as strong earnings.
Acquisition of Community State Bank, Headquartered in Des Moines/Ankeny, Iowa
As previously announced, the Company plans to close the acquisition of Community State Bank during the third quarter, pending regulatory approval by bank regulators and certain customary closing conditions.
Continued Focus on Seven Key Initiatives
The Company continues to focus on the following initiatives in an ongoing effort to continue to improve profitability and drive increased shareholder value:
- Target loans and leases to total assets ratio in the range of 70-75%
- Continue to reduce wholesale funding to less than 15% of assets
- Grow gains on the sale of USDA and SBA loans, and fee income on swaps, to a more significant and consistent component of core revenue
- Grow wealth management net income by 15% annually
- Eliminate identified noninterest expenses and manage annual expense growth
- Return asset quality metrics to better than peer levels
- Participate as an acquirer in the consolidation taking place in our markets to further boost ROAA, improve efficiency ratio, and increase EPS
About Us
QCR Holdings, Inc., headquartered in Moline, Illinois, is a relationship-driven, multi-bank holding company, which serves the Quad City, Cedar Rapids, Cedar Valley, and Rockford communities through its wholly owned subsidiary banks. Quad City Bank & Trust Company, which is based in Bettendorf, Iowa, and commenced operations in 1994, Cedar Rapids Bank & Trust Company, which is based in Cedar Rapids, Iowa, and commenced operations in 2001, and Rockford Bank & Trust Company, which is based in Rockford, Illinois, and commenced operations in 2005, provide full-service commercial and consumer banking and trust and wealth management services. Quad City Bank & Trust Company also provides correspondent banking services. In addition, Quad City Bank & Trust Company engages in commercial leasing through its wholly owned subsidiary, m2 Lease Funds, LLC, based in Milwaukee, Wisconsin.
Special Note Concerning Forward-Looking Statements. This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “predict,” “suggest,” “appear,” “plan,” “intend,” “estimate,” ”annualize,” “may,” “will,” “would,” “could,” “should” or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.
A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of the local and national economy; (ii) the economic impact of any future terrorist threats and attacks, and the response of the United States to any such threats and attacks; (iii) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business, including the Basel III regulatory capital reforms, the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations issued thereunder; (iv) changes in interest rates and prepayment rates of the Company’s assets; (v) increased competition in the financial services sector and the inability to attract new customers; (vi) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (vii) the integration of acquired entities, including the planned acquisition of Community State Bank; (viii) the loss of key executives or employees; (ix) changes in consumer spending; (x) unexpected outcomes of existing or new litigation involving the Company; and (xi) changes in accounting policies and practices. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.
QCR HOLDINGS, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | ||||||||||||||||
As of | ||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||
2016 | 2016 | 2015 | 2015 | 2015 | ||||||||||||
(dollars in thousands) | ||||||||||||||||
CONDENSED BALANCE SHEET | ||||||||||||||||
Cash and due from banks | $ | 49,581 | $ | 44,931 | $ | 41,742 | $ | 40,975 | $ | 39,995 | ||||||
Federal funds sold and interest-bearing deposits | 68,432 | 57,229 | 56,164 | 66,684 | 70,238 | |||||||||||
Securities | 510,959 | 537,317 | 577,109 | 590,775 | 592,368 | |||||||||||
Net loans/leases | 1,894,676 | 1,846,428 | 1,771,882 | 1,730,138 | 1,689,238 | |||||||||||
Core deposit intangible | 1,372 | 1,422 | 1,471 | 1,521 | 1,571 | |||||||||||
Goodwill | 3,223 | 3,223 | 3,223 | 3,223 | 3,223 | |||||||||||
Other assets | 155,191 | 150,123 | 141,607 | 142,539 | 146,336 | |||||||||||
Total assets | $ | 2,683,434 | $ | 2,640,673 | $ | 2,593,198 | $ | 2,575,855 | $ | 2,542,969 | ||||||
Total deposits | $ | 1,973,594 | $ | 1,989,573 | $ | 1,880,666 | $ | 1,855,319 | $ | 1,836,767 | ||||||
Total borrowings | 381,874 | 347,901 | 444,162 | 456,091 | 456,567 | |||||||||||
Other liabilities | 52,849 | 68,056 | 42,484 | 43,330 | 37,938 | |||||||||||
Total stockholders' equity | 275,117 | 235,143 | 225,886 | 221,115 | 211,697 | |||||||||||
Total liabilities and stockholders' equity | $ | 2,683,434 | $ | 2,640,673 | $ | 2,593,198 | $ | 2,575,855 | $ | 2,542,969 | ||||||
ANALYSIS OF LOAN PORTFOLIO | ||||||||||||||||
Loan/lease mix: | ||||||||||||||||
Commercial and industrial loans | $ | 706,261 | $ | 682,057 | $ | 648,160 | $ | 647,398 | $ | 606,826 | ||||||
Commercial real estate loans | 784,379 | 766,159 | 724,369 | 692,569 | 696,122 | |||||||||||
Direct financing leases | 169,928 | 172,774 | 173,656 | 173,304 | 170,799 | |||||||||||
Residential real estate loans | 180,482 | 173,096 | 170,433 | 165,061 | 161,985 | |||||||||||
Installment and other consumer loans | 73,658 | 71,842 | 73,669 | 69,863 | 72,448 | |||||||||||
Deferred loan/lease origination costs, net of fees | 8,065 | 7,895 | 7,736 | 7,477 | 7,204 | |||||||||||
Total loans/leases | $ | 1,922,773 | $ | 1,873,823 | $ | 1,798,023 | $ | 1,755,672 | $ | 1,715,384 | ||||||
Less allowance for estimated losses on loans/leases | 28,097 | 27,395 | 26,141 | 25,534 | 26,146 | |||||||||||
Net loans/leases | $ | 1,894,676 | $ | 1,846,428 | $ | 1,771,882 | $ | 1,730,138 | $ | 1,689,238 | ||||||
ANALYSIS OF SECURITIES PORTFOLIO | ||||||||||||||||
Securities mix: | ||||||||||||||||
U.S. government sponsored agency securities | $ | 88,321 | $ | 132,742 | $ | 213,537 | $ | 247,625 | $ | 256,444 | ||||||
Municipal securities | 302,689 | 285,009 | 280,203 | 265,293 | 251,992 | |||||||||||
Residential mortgage-backed and related securities | 116,765 | 116,452 | 80,670 | 74,901 | 80,844 | |||||||||||
Other securities | 3,184 | 3,114 | 2,699 | 2,956 | 3,088 | |||||||||||
Total securities | $ | 510,959 | $ | 537,317 | $ | 577,109 | $ | 590,775 | $ | 592,368 | ||||||
ANALYSIS OF DEPOSITS | ||||||||||||||||
Deposit mix: | ||||||||||||||||
Noninterest-bearing demand deposits | $ | 615,764 | $ | 641,859 | $ | 615,292 | $ | 585,300 | $ | 633,370 | ||||||
Interest-bearing demand deposits | 918,036 | 916,455 | 886,294 | 877,642 | 775,688 | |||||||||||
Time deposits | 337,584 | 331,786 | 309,974 | 302,978 | 322,826 | |||||||||||
Brokered deposits | 102,210 | 99,473 | 69,106 | 89,399 | 104,883 | |||||||||||
Total deposits | $ | 1,973,594 | $ | 1,989,573 | $ | 1,880,666 | $ | 1,855,319 | $ | 1,836,767 | ||||||
ANALYSIS OF BORROWINGS | ||||||||||||||||
Borrowings mix: | ||||||||||||||||
Term FHLB advances | $ | 78,000 | $ | 80,000 | $ | 97,000 | $ | 102,000 | $ | 104,000 | ||||||
Overnight FHLB advances (1) | 118,900 | 70,500 | 54,000 | 31,000 | 28,500 | |||||||||||
Wholesale structured repurchase agreements | 100,000 | 100,000 | 110,000 | 115,000 | 115,000 | |||||||||||
Customer repurchase agreements | 21,441 | 52,153 | 73,873 | 74,404 | 118,795 | |||||||||||
Federal funds purchased | 30,120 | 11,870 | 70,790 | 93,160 | 49,780 | |||||||||||
Junior subordinated debentures | 33,413 | 33,378 | 38,499 | 40,527 | 40,492 | |||||||||||
Total borrowings | $ | 381,874 | $ | 347,901 | $ | 444,162 | $ | 456,091 | $ | 456,567 | ||||||
(1) At the most recent quarter-end, the weighted-average rate of these overnight borrowings was 0.40% | ||||||||||||||||
QCR HOLDINGS, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||
For the Six Months Ended | |||||||||||
June 30, | June 30, | ||||||||||
2016 | 2015 | ||||||||||
(dollars in thousands, except per share data) | |||||||||||
INCOME STATEMENT | |||||||||||
Interest income | $ | 47,415 | $ | 43,952 | |||||||
Interest expense | 5,809 | 7,679 | |||||||||
Net interest income | 41,606 | 36,273 | |||||||||
Provision for loan/lease losses | 3,271 | 4,059 | |||||||||
Net interest income after provision for loan/lease losses | $ | 38,335 | $ | 32,214 | |||||||
Trust department fees | $ | 3,088 | $ | 3,144 | |||||||
Investment advisory and management fees | 1,351 | 1,468 | |||||||||
Deposit service fees | 1,878 | 1,826 | |||||||||
Gain on sales of residential real estate loans | 145 | 182 | |||||||||
Gain on sales of government guaranteed portions of loans | 2,482 | 140 | |||||||||
Swap fee income | 1,025 | 1,120 | |||||||||
Securities gains, net | 376 | 417 | |||||||||
Earnings on bank-owned life insurance | 874 | 912 | |||||||||
Debit card fees | 651 | 493 | |||||||||
Correspondent banking fees | 547 | 605 | |||||||||
Participation service fees on commercial loan participations | 457 | 446 | |||||||||
Fee income from early termination of leases | 78 | 162 | |||||||||
Credit card issuing fees | 276 | 270 | |||||||||
Other | 357 | 498 | |||||||||
Total noninterest income | $ | 13,585 | $ | 11,683 | |||||||
Salaries and employee benefits | $ | 21,718 | $ | 22,126 | |||||||
Occupancy and equipment expense | 3,711 | 3,660 | |||||||||
Professional and data processing fees | 2,990 | 2,941 | |||||||||
Acquisition costs | 355 | - | |||||||||
FDIC insurance, other insurance and regulatory fees | 1,284 | 1,450 | |||||||||
Loan/lease expense | 317 | 512 | |||||||||
Net cost of operation of other real estate | 380 | 29 | |||||||||
Advertising and marketing | 820 | 908 | |||||||||
Postage and communications | 474 | 463 | |||||||||
Stationery and supplies | 323 | 279 | |||||||||
Bank service charges | 831 | 696 | |||||||||
Losses on debt extinguishment, net | 83 | 6,894 | |||||||||
Correspondent banking expense | 359 | 341 | |||||||||
Other | 1,053 | 1,007 | |||||||||
Total noninterest expense | $ | 34,698 | $ | 41,306 | |||||||
Net income before taxes | $ | 17,222 | $ | 2,591 | |||||||
Income tax expense (benefit) | 4,172 | (1,063 | ) | ||||||||
Net income | $ | 13,050 | $ | 3,654 | |||||||
Basic EPS | $ | 1.08 | $ | 0.41 | |||||||
Diluted EPS | $ | 1.07 | $ | 0.40 | |||||||
Weighted average common shares outstanding | 12,064,349 | 8,961,327 | |||||||||
Weighted average common and common equivalent shares outstanding | 12,235,212 | 9,098,697 | |||||||||
QCR HOLDINGS, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||
For the Quarter Ended | |||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||
2016 | 2016 | 2015 | 2015 | 2015 | |||||||||||||
(dollars in thousands, except per share data) | |||||||||||||||||
INCOME STATEMENT | |||||||||||||||||
Interest income | $ | 23,913 | $ | 23,502 | $ | 22,910 | $ | 23,141 | $ | 22,051 | |||||||
Interest expense | 2,904 | 2,905 | 3,024 | 3,004 | 3,560 | ||||||||||||
Net interest income | 21,009 | 20,597 | 19,886 | 20,137 | 18,491 | ||||||||||||
Provision for loan/lease losses | 1,198 | 2,073 | 1,177 | 1,635 | 2,349 | ||||||||||||
Net interest income after provision for loan/lease losses | $ | 19,811 | $ | 18,524 | $ | 18,709 | $ | 18,502 | $ | 16,142 | |||||||
Trust department fees | $ | 1,512 | $ | 1,576 | $ | 1,455 | $ | 1,532 | $ | 1,511 | |||||||
Investment advisory and management fees | 693 | 658 | 721 | 782 | 758 | ||||||||||||
Deposit service fees | 947 | 931 | 1,003 | 994 | 925 | ||||||||||||
Gain on sales of residential real estate loans | 84 | 60 | 57 | 85 | 96 | ||||||||||||
Gain on sales of government guaranteed portions of loans | 1,604 | 879 | 405 | 760 | 69 | ||||||||||||
Swap fee income | 168 | 857 | 535 | 63 | 394 | ||||||||||||
Securities gains, net | 18 | 358 | 325 | 57 | - | ||||||||||||
Earnings on bank-owned life insurance | 480 | 394 | 443 | 407 | 433 | ||||||||||||
Debit card fees | 344 | 308 | 290 | 290 | 255 | ||||||||||||
Correspondent banking fees | 245 | 302 | 275 | 311 | 285 | ||||||||||||
Participation service fees on commercial loan participations | 246 | 211 | 218 | 202 | 224 | ||||||||||||
Fee income from early termination of leases | 66 | 12 | 46 | 89 | 76 | ||||||||||||
Credit card issuing fees | 139 | 137 | 134 | 134 | 136 | ||||||||||||
Lawsuit settlement | - | - | - | 387 | - | ||||||||||||
Other | 216 | 139 | 271 | 276 | 299 | ||||||||||||
Total noninterest income | $ | 6,762 | $ | 6,822 | $ | 6,178 | $ | 6,369 | $ | 5,461 | |||||||
Salaries and employee benefits | $ | 10,917 | $ | 10,801 | $ | 10,258 | $ | 10,583 | $ | 11,092 | |||||||
Occupancy and equipment expense | 1,885 | 1,827 | 1,535 | 1,864 | 1,865 | ||||||||||||
Professional and data processing fees | 1,542 | 1,447 | 840 | 1,742 | 1,471 | ||||||||||||
Acquisition costs | 355 | - | - | - | - | ||||||||||||
FDIC insurance, other insurance and regulatory fees | 650 | 634 | 573 | 702 | 731 | ||||||||||||
Loan/lease expense | 154 | 163 | 281 | 90 | 209 | ||||||||||||
Net cost of operation of other real estate | 278 | 102 | (4 | ) | (1,118 | ) | (48 | ) | |||||||||
Advertising and marketing | 433 | 386 | 532 | 460 | 490 | ||||||||||||
Postage and communications | 257 | 217 | 252 | 221 | 214 | ||||||||||||
Stationery and supplies | 158 | 165 | 171 | 145 | 137 | ||||||||||||
Bank service charges | 415 | 416 | 396 | 392 | 359 | ||||||||||||
Losses on debt extinguishment, net | - | 83 | 291 | - | 6,894 | ||||||||||||
Correspondent banking expense | 182 | 177 | 186 | 177 | 165 | ||||||||||||
Other | 518 | 536 | 528 | 655 | 523 | ||||||||||||
Total noninterest expense | $ | 17,744 | $ | 16,954 | $ | 15,839 | $ | 15,913 | $ | 24,102 | |||||||
Net income (loss) before taxes | $ | 8,829 | $ | 8,392 | $ | 9,048 | $ | 8,958 | $ | (2,499 | ) | ||||||
Income tax expense (benefit) | 2,153 | 2,019 | 2,263 | 2,469 | (1,974 | ) | |||||||||||
Net income (loss) | $ | 6,676 | $ | 6,373 | $ | 6,785 | $ | 6,489 | $ | (524 | ) | ||||||
Basic EPS | $ | 0.54 | $ | 0.54 | $ | 0.58 | $ | 0.55 | $ | (0.05 | ) | ||||||
Diluted EPS | $ | 0.53 | $ | 0.53 | $ | 0.57 | $ | 0.55 | $ | (0.05 | ) | ||||||
Weighted average common shares outstanding | 12,335,077 | 11,793,620 | 11,744,495 | 11,713,993 | 9,946,744 | ||||||||||||
Weighted average common and common equivalent shares outstanding | 12,516,474 | 11,953,949 | 11,926,038 | 11,875,930 | 9,946,744 | ||||||||||||
QCR HOLDINGS, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||||||
For the Quarter Ended | For the Six Months Ended | ||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | |||||||||||||||||
2016 | 2016 | 2015 | 2015 | 2015 | 2016 | 2015 | |||||||||||||||||
(dollars in thousands, except per share data) | |||||||||||||||||||||||
COMMON SHARE DATA | |||||||||||||||||||||||
Common shares outstanding | 13,057,368 | 11,814,911 | 11,761,083 | 11,728,911 | 11,698,578 | ||||||||||||||||||
Book value per common share (1) | $ | 21.07 | $ | 19.90 | $ | 19.21 | $ | 18.85 | $ | 18.10 | |||||||||||||
Tangible book value per common share (2) | $ | 20.72 | $ | 19.51 | $ | 18.81 | $ | 18.45 | $ | 17.69 | |||||||||||||
Closing stock price | $ | 27.19 | $ | 23.79 | $ | 24.29 | $ | 21.87 | $ | 21.76 | |||||||||||||
Market capitalization | $ | 355,030 | $ | 281,077 | $ | 285,677 | $ | 256,511 | $ | 254,561 | |||||||||||||
Market price / book value | 129.05 | % | 119.53 | % | 126.47 | % | 116.01 | % | 120.25 | % | |||||||||||||
Market price / tangible book value | 131.24 | % | 121.94 | % | 129.15 | % | 118.55 | % | 123.03 | % | |||||||||||||
Earnings per common share (basic) LTM (3) | $ | 2.21 | $ | 1.62 | $ | 1.64 | $ | 1.40 | $ | 1.36 | |||||||||||||
Price earnings ratio LTM (3) | 12.30 x | 14.69 x | 14.81 x | 15.62 x | 16.00 x | ||||||||||||||||||
TCE / TA (4) | 10.10 | % | 8.74 | % | 8.55 | % | 8.42 | % | 8.15 | % | |||||||||||||
CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY | |||||||||||||||||||||||
Beginning balance | $ | 235,143 | $ | 225,886 | $ | 221,115 | $ | 211,697 | $ | 150,996 | |||||||||||||
Net income (loss) | 6,676 | 6,373 | 6,785 | 6,489 | (524 | ) | |||||||||||||||||
Other comprehensive income (loss), net of tax | 1,181 | 2,525 | (2,287 | ) | 2,256 | (2,379 | ) | ||||||||||||||||
Common cash dividends declared | (521 | ) | (471 | ) | (469 | ) | - | (465 | ) | ||||||||||||||
Proceeds from issuance of 3,680,000 shares of common stock, net of costs | - | - | - | - | 63,484 | ||||||||||||||||||
Proceeds from issuance of 1,215,000 shares of common stock, net of costs | 29,829 | - | - | - | - | ||||||||||||||||||
Other (5) | 2,809 | 830 | 742 | 673 | 585 | ||||||||||||||||||
Ending balance | $ | 275,117 | $ | 235,143 | $ | 225,886 | $ | 221,115 | $ | 211,697 | |||||||||||||
REGULATORY CAPITAL RATIOS (6): | |||||||||||||||||||||||
Total risk-based capital ratio | 14.23 | % | 12.68 | % | 13.11 | % | 13.06 | % | 12.92 | % | |||||||||||||
Tier 1 risk-based capital ratio | 12.98 | % | 11.45 | % | 11.88 | % | 11.83 | % | 11.66 | % | |||||||||||||
Tier 1 leverage capital ratio | 11.18 | % | 9.85 | % | 9.75 | % | 9.73 | % | 9.62 | % | |||||||||||||
Common equity tier 1 ratio | 11.66 | % | 10.11 | % | 10.33 | % | 10.16 | % | 9.97 | % | |||||||||||||
KEY PERFORMANCE RATIOS AND OTHER METRICS | |||||||||||||||||||||||
Return on average assets (annualized) | 1.01 | % | 0.98 | % | 1.04 | % | 1.01 | % | -0.08 | % | 1.00 | % | 0.29 | % | |||||||||
Return on average total equity (annualized) | 10.46 | % | 11.02 | % | 12.14 | % | 11.99 | % | -1.15 | % | 10.73 | % | 4.43 | % | |||||||||
Net interest margin (TEY) (7) | 3.62 | % | 3.59 | % | 3.41 | % | 3.51 | % | 3.33 | % | 3.61 | % | 3.29 | % | |||||||||
Efficiency ratio | 63.89 | % | 61.83 | % | 61.22 | % | 61.88 | % | 100.62 | % | 62.87 | % | 86.20 | % | |||||||||
Gross loans and leases / total assets | 71.65 | % | 70.96 | % | 69.34 | % | 68.16 | % | 67.46 | % | 71.65 | % | 67.46 | % | |||||||||
Full-time equivalent employees | 410 | 406 | 406 | 406 | 416 | 410 | 416 | ||||||||||||||||
AVERAGE BALANCES | |||||||||||||||||||||||
Assets | $ | 2,640,678 | $ | 2,602,350 | $ | 2,611,276 | $ | 2,563,739 | $ | 2,518,170 | $ | 2,621,514 | $ | 2,512,334 | |||||||||
Loans/leases | 1,899,932 | 1,833,950 | 1,764,275 | 1,744,043 | 1,686,068 | 1,866,941 | 1,660,887 | ||||||||||||||||
Deposits | 2,033,116 | 1,980,056 | 1,978,737 | 1,881,604 | 1,798,787 | 2,006,586 | 1,772,996 | ||||||||||||||||
Total stockholders' equity | 255,391 | 231,247 | 223,553 | 216,453 | 181,811 | 243,319 | 164,975 | ||||||||||||||||
(1) Includes accumulated other comprehensive income (loss). | |||||||||||||||||||||||
(2) Includes accumulated other comprehensive income (loss) and excludes intangible assets. | |||||||||||||||||||||||
(3) LTM : Last twelve months. | |||||||||||||||||||||||
(4) TCE / TCA : tangible common equity / total tangible assets. See GAAP to non-GAAP reconciliations. | |||||||||||||||||||||||
(5) Includes mostly common stock issued for options exercised and the employee stock purchase plan, as well as stock-based compensation. | |||||||||||||||||||||||
(6) Ratios for the current quarter are subject to change upon final calculation for regulatory filings due after earnings release. | |||||||||||||||||||||||
(7) TEY : Tax equivalent yield |
QCR HOLDINGS, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | ||||||||||||||||||||||||||||||
ANALYSIS OF NET INTEREST INCOME AND MARGIN | ||||||||||||||||||||||||||||||
For the Quarter Ended | ||||||||||||||||||||||||||||||
June 30, 2016 | March 31, 2016 | June 30, 2015 | ||||||||||||||||||||||||||||
Average Balance | Interest Earned or Paid | Average Yield or Cost | Average Balance | Interest Earned or Paid | Average Yield or Cost | Average Balance | Interest Earned or Paid | Average Yield or Cost | ||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||
Fed funds sold | $ | 14,174 | $ | 11 | 0.31 | % | $ | 17,232 | $ | 13 | 0.30 | % | $ | 19,523 | $ | 6 | 0.12 | % | ||||||||||||
Interest-bearing deposits at financial institutions | 50,747 | 62 | 0.49 | % | 40,635 | 60 | 0.59 | % | 45,229 | 65 | 0.58 | % | ||||||||||||||||||
Securities (1) | 505,697 | 4,573 | 3.64 | % | 550,371 | 4,685 | 3.42 | % | 608,688 | 4,548 | 3.00 | % | ||||||||||||||||||
Restricted investment securities | 14,171 | 134 | 3.80 | % | 14,140 | 131 | 3.73 | % | 15,083 | 108 | 2.87 | % | ||||||||||||||||||
Loans (1) | 1,899,932 | 20,497 | 4.34 | % | 1,833,950 | 19,955 | 4.38 | % | 1,686,068 | 18,541 | 4.41 | % | ||||||||||||||||||
Total earning assets (1) | $ | 2,484,721 | $ | 25,277 | 4.09 | % | $ | 2,456,328 | $ | 24,844 | 4.07 | % | $ | 2,374,591 | $ | 23,268 | 3.93 | % | ||||||||||||
Interest-bearing deposits | $ | 941,856 | $ | 600 | 0.26 | % | $ | 925,246 | $ | 615 | 0.27 | % | $ | 784,148 | $ | 450 | 0.23 | % | ||||||||||||
Time deposits | 425,216 | 744 | 0.70 | % | 399,604 | 675 | 0.68 | % | 384,895 | 634 | 0.66 | % | ||||||||||||||||||
Short-term borrowings | 50,122 | 18 | 0.14 | % | 86,539 | 43 | 0.20 | % | 160,479 | 53 | 0.13 | % | ||||||||||||||||||
Federal Home Loan Bank advances | 128,956 | 416 | 1.30 | % | 128,436 | 442 | 1.38 | % | 173,742 | 1,002 | 2.31 | % | ||||||||||||||||||
Junior subordinated debentures | 33,396 | 302 | 3.64 | % | 34,650 | 305 | 3.54 | % | 40,475 | 313 | 3.10 | % | ||||||||||||||||||
Other borrowings | 100,008 | 824 | 3.31 | % | 101,738 | 825 | 3.26 | % | 129,802 | 1,108 | 3.42 | % | ||||||||||||||||||
Total interest-bearing liabilities | $ | 1,679,554 | $ | 2,904 | 0.70 | % | $ | 1,676,213 | $ | 2,905 | 0.70 | % | $ | 1,673,541 | $ | 3,560 | 0.85 | % | ||||||||||||
Net interest income / spread (1) | $ | 22,373 | 3.39 | % | $ | 21,939 | 3.37 | % | $ | 19,708 | 3.08 | % | ||||||||||||||||||
Net interest margin (1) | 3.62 | % | 3.59 | % | 3.33 | % | ||||||||||||||||||||||||
For the Six Months Ended | ||||||||||||||||||||||||||||||
June 30, 2016 | June 30, 2015 | |||||||||||||||||||||||||||||
Average Balance | Interest Earned or Paid | Average Yield or Cost | Average Balance | Interest Earned or Paid | Average Yield or Cost | |||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||
Fed funds sold | $ | 15,703 | $ | 23 | 0.29 | % | $ | 16,606 | $ | 11 | 0.13 | % | ||||||||||||||||||
Interest-bearing deposits at financial institutions | 45,691 | 123 | 0.54 | % | 57,602 | 142 | 0.50 | % | ||||||||||||||||||||||
Securities (1) | 528,034 | 9,257 | 3.53 | % | 617,261 | 9,037 | 2.95 | % | ||||||||||||||||||||||
Restricted investment securities | 14,156 | 264 | 3.75 | % | 15,513 | 250 | 3.25 | % | ||||||||||||||||||||||
Loans (1) | 1,866,941 | 40,454 | 4.36 | % | 1,660,885 | 36,893 | 4.48 | % | ||||||||||||||||||||||
Total earning assets (1) | $ | 2,470,525 | $ | 50,121 | 4.08 | % | $ | 2,367,867 | $ | 46,333 | 3.95 | % | ||||||||||||||||||
Interest-bearing deposits | $ | 933,551 | $ | 1,214 | 0.26 | % | $ | 785,749 | $ | 892 | 0.23 | % | ||||||||||||||||||
Time deposits | 412,410 | 1,420 | 0.69 | % | 379,630 | 1,264 | 0.67 | % | ||||||||||||||||||||||
Short-term borrowings | 68,331 | 61 | 0.18 | % | 170,697 | 117 | 0.14 | % | ||||||||||||||||||||||
Federal Home Loan Bank advances | 128,696 | 858 | 1.34 | % | 190,109 | 2,446 | 2.59 | % | ||||||||||||||||||||||
Junior subordinated debentures | 34,023 | 606 | 3.58 | % | 40,458 | 620 | 3.09 | % | ||||||||||||||||||||||
Other borrowings | 100,873 | 1,650 | 3.29 | % | 139,408 | 2,340 | 3.38 | % | ||||||||||||||||||||||
Total interest-bearing liabilities | $ | 1,677,884 | $ | 5,809 | 0.70 | % | $ | 1,706,051 | $ | 7,679 | 0.91 | % | ||||||||||||||||||
Net interest income / spread (1) | $ | 44,312 | 3.38 | % | $ | 38,654 | 3.04 | % | ||||||||||||||||||||||
Net interest margin (1) | 3.61 | % | 3.29 | % | ||||||||||||||||||||||||||
(1) Includes nontaxable securities and loans. Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 35% tax rate for each period presented. | ||||||||||||||||||||||||||||||
QCR HOLDINGS, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | ||||||||||||||||
As of | ||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||
2016 | 2016 | 2015 | 2015 | 2015 | ||||||||||||
(dollars in thousands, except per share data) | ||||||||||||||||
ROLLFORWARD OF ALLOWANCE FOR LOAN/LEASE LOSSES | ||||||||||||||||
Beginning balance | $ | 27,395 | $ | 26,141 | $ | 25,534 | $ | 26,146 | $ | 23,883 | ||||||
Provision charged to expense | 1,198 | 2,073 | 1,177 | 1,635 | 2,349 | |||||||||||
Loans/leases charged off | (634 | ) | (868 | ) | (1,106 | ) | (2,476 | ) | (536 | ) | ||||||
Recoveries on loans/leases previously charged off | 138 | 49 | 536 | 229 | 450 | |||||||||||
Ending balance | $ | 28,097 | $ | 27,395 | $ | 26,141 | $ | 25,534 | $ | 26,146 | ||||||
NONPERFORMING ASSETS | ||||||||||||||||
Nonaccrual loans/leases | $ | 10,737 | $ | 10,772 | $ | 10,648 | $ | 11,269 | $ | 13,542 | ||||||
Accruing loans/leases past due 90 days or more | 86 | 47 | 3 | 3 | 46 | |||||||||||
Troubled debt restructures - accruing | 1,753 | 1,157 | 1,054 | 1,040 | 1,266 | |||||||||||
Total nonperforming loans/leases | 12,576 | 11,976 | 11,705 | 12,312 | 14,854 | |||||||||||
Other real estate owned | 6,179 | 6,680 | 7,151 | 8,140 | 11,952 | |||||||||||
Other repossessed assets | 154 | 46 | 246 | 194 | 297 | |||||||||||
Total nonperforming assets | $ | 18,909 | $ | 18,702 | $ | 19,102 | $ | 20,646 | $ | 27,103 | ||||||
ASSET QUALITY RATIOS | ||||||||||||||||
Nonperforming assets / total assets | 0.70 | % | 0.71 | % | 0.74 | % | 0.80 | % | 1.07 | % | ||||||
Allowance / total loans/leases (1) | 1.46 | % | 1.46 | % | 1.45 | % | 1.45 | % | 1.52 | % | ||||||
Allowance / nonperforming loans/leases (1) | 223.42 | % | 228.75 | % | 223.33 | % | 207.39 | % | 176.02 | % | ||||||
QCR HOLDINGS, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | ||||||||||||||||||||||||
For the Quarter Ended | For the Six Months Ended | |||||||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | ||||||||||||||||||||
SELECT FINANCIAL DATA - SUBSIDIARIES | 2016 | 2016 | 2015 | 2016 | 2015 | |||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||
TOTAL ASSETS | ||||||||||||||||||||||||
Quad City Bank and Trust (1) | $ | 1,390,025 | $ | 1,361,607 | $ | 1,299,557 | ||||||||||||||||||
m2 Lease Funds, LLC | 207,334 | 205,777 | 189,951 | |||||||||||||||||||||
Cedar Rapids Bank and Trust | 904,367 | 885,858 | 860,403 | |||||||||||||||||||||
Rockford Bank and Trust | 402,157 | 367,032 | 363,050 | |||||||||||||||||||||
TOTAL DEPOSITS | ||||||||||||||||||||||||
Quad City Bank and Trust (1) | $ | 1,049,049 | $ | 1,029,298 | $ | 929,817 | ||||||||||||||||||
Cedar Rapids Bank and Trust | 690,377 | 686,548 | 649,586 | |||||||||||||||||||||
Rockford Bank and Trust | 296,613 | 278,129 | 260,373 | |||||||||||||||||||||
TOTAL LOANS & LEASES | ||||||||||||||||||||||||
Quad City Bank and Trust (1) | $ | 968,905 | $ | 950,978 | $ | 832,799 | ||||||||||||||||||
m2 Lease Funds, LLC | 205,883 | 205,214 | 189,311 | |||||||||||||||||||||
Cedar Rapids Bank and Trust | 648,727 | 628,580 | 598,002 | |||||||||||||||||||||
Rockford Bank and Trust | 305,141 | 294,266 | 285,944 | |||||||||||||||||||||
TOTAL LOANS & LEASES / TOTAL ASSETS | ||||||||||||||||||||||||
Quad City Bank and Trust (1) | 70 | % | 70 | % | 64 | % | ||||||||||||||||||
Cedar Rapids Bank and Trust | 72 | % | 71 | % | 70 | % | ||||||||||||||||||
Rockford Bank and Trust | 76 | % | 80 | % | 79 | % | ||||||||||||||||||
ALLOWANCE AS A PERCENTAGE OF LOANS/LEASES | ||||||||||||||||||||||||
Quad City Bank and Trust (1) | 1.31 | % | 1.31 | % | 1.52 | % | ||||||||||||||||||
m2 Lease Funds, LLC | 1.80 | % | 1.80 | % | 1.88 | % | ||||||||||||||||||
Cedar Rapids Bank and Trust | 1.65 | % | 1.66 | % | 1.56 | % | ||||||||||||||||||
Rockford Bank and Trust | 1.53 | % | 1.51 | % | 1.45 | % | ||||||||||||||||||
RETURN ON AVERAGE ASSETS | ||||||||||||||||||||||||
Quad City Bank and Trust (1) | 1.24 | % | 0.95 | % | 0.19 | % | 1.10 | % | 0.56 | % | ||||||||||||||
Cedar Rapids Bank and Trust | 1.46 | % | 1.39 | % | -0.10 | % | 1.42 | % | 0.46 | % | ||||||||||||||
Rockford Bank and Trust | 0.80 | % | 0.66 | % | 0.53 | % | 0.73 | % | 0.53 | % | ||||||||||||||
NET INTEREST MARGIN PERCENTAGE (3) | ||||||||||||||||||||||||
Quad City Bank and Trust (1) | 3.66 | % | 3.60 | % | 3.28 | % | 3.63 | % | 3.20 | % | ||||||||||||||
Cedar Rapids Bank and Trust | 3.77 | % | 3.75 | % | 3.63 | % | 3.77 | % | 3.63 | % | ||||||||||||||
Rockford Bank and Trust | 3.49 | % | 3.54 | % | 3.38 | % | 3.52 | % | 3.41 | % | ||||||||||||||
(1) Quad City Bank and Trust figures include m2 Lease Funds, LLC, as this entity is wholly-owned and consolidated with the Bank. m2 Lease Funds, LLC is also presented separately for certain (applicable) measurements. | ||||||||||||||||||||||||
(2) m2 Lease Funds, LLC net income is post-tax, using an estimated effective tax rate of 35%. | ||||||||||||||||||||||||
(3) Includes nontaxable securities and loans. Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 35% tax rate for each period presented. | ||||||||||||||||||||||||
QCR HOLDINGS, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||||||||||||
As of | |||||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||||||||||||||
GAAP TO NON-GAAP RECONCILIATIONS | 2016 | 2016 | 2015 | 2015 | 2015 | ||||||||||||||||||||||||
(dollars in thousands, except per share data) | |||||||||||||||||||||||||||||
TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS RATIO (1) | |||||||||||||||||||||||||||||
Stockholders' equity (GAAP) | $ | 275,117 | $ | 235,143 | $ | 225,886 | $ | 221,115 | $ | 211,697 | |||||||||||||||||||
Less: Intangible assets | 4,595 | 4,645 | 4,694 | 4,744 | 4,794 | ||||||||||||||||||||||||
Tangible common equity (non-GAAP) | $ | 270,522 | $ | 230,498 | $ | 221,192 | $ | 216,371 | $ | 206,903 | |||||||||||||||||||
Total assets (GAAP) | $ | 2,683,434 | $ | 2,640,673 | $ | 2,593,198 | $ | 2,575,855 | $ | 2,542,969 | |||||||||||||||||||
Less: Intangible assets | 4,595 | 4,645 | 4,694 | 4,744 | 4,794 | ||||||||||||||||||||||||
Tangible assets (non-GAAP) | $ | 2,678,839 | $ | 2,636,028 | $ | 2,588,504 | $ | 2,571,111 | $ | 2,538,175 | |||||||||||||||||||
Tangible common equity to tangible assets ratio (non-GAAP) | 10.10 | % | 8.74 | % | 8.55 | % | 8.42 | % | 8.15 | % | |||||||||||||||||||
For the Quarter Ended | For the Six Months Ended | ||||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | |||||||||||||||||||||||
CORE NET INCOME (2) | 2016 | 2016 | 2015 | 2015 | 2015 | 2016 | 2015 | ||||||||||||||||||||||
Net income (loss) (GAAP) | $ | 6,676 | $ | 6,373 | $ | 6,785 | $ | 6,489 | $ | (524 | ) | $ | 13,050 | $ | 3,654 | ||||||||||||||
Less nonrecurring items (post-tax) (3): | |||||||||||||||||||||||||||||
Income: | |||||||||||||||||||||||||||||
Securities gains | $ | 12 | $ | 233 | $ | 211 | $ | 37 | $ | - | $ | 245 | $ | 274 | |||||||||||||||
Lawsuit award | - | - | - | 252 | - | - | - | ||||||||||||||||||||||
Total nonrecurring income (non-GAAP) | $ | 12 | $ | 233 | $ | 211 | $ | 289 | $ | - | $ | 245 | $ | 274 | |||||||||||||||
Expense: | |||||||||||||||||||||||||||||
Losses on debt extinguishment | $ | - | $ | 54 | $ | 189 | $ | - | $ | 4,481 | $ | 54 | $ | 4,481 | |||||||||||||||
Acquisition costs | 231 | - | - | - | - | 231 | - | ||||||||||||||||||||||
Other non-recurring expenses | - | - | - | - | 513 | - | 513 | ||||||||||||||||||||||
Accrual adjustments | - | - | (487 | ) | - | - | - | - | |||||||||||||||||||||
Total nonrecurring expense (non-GAAP) | $ | 231 | $ | 54 | $ | (298 | ) | $ | - | $ | 4,994 | $ | 285 | $ | 4,994 | ||||||||||||||
Core net income attributable to QCR Holdings, Inc. common stockholders (non-GAAP) (2) | $ | 6,895 | $ | 6,194 | $ | 6,276 | $ | 6,200 | $ | 4,470 | $ | 13,090 | $ | 8,374 | |||||||||||||||
CORE EARNINGS PER COMMON SHARE (2) | |||||||||||||||||||||||||||||
Core net income attributable to QCR Holdings, Inc. common stockholders (non-GAAP) (from above) | $ | 6,895 | $ | 6,194 | $ | 6,276 | $ | 6,200 | $ | 4,470 | $ | 13,090 | $ | 8,374 | |||||||||||||||
Weighted average common shares outstanding | 12,335,077 | 11,793,620 | 11,744,495 | 11,713,993 | 9,946,744 | 12,064,349 | 8,961,327 | ||||||||||||||||||||||
Weighted average common and common equivalent shares outstanding | 12,516,474 | 11,953,949 | 11,926,038 | 11,875,930 | 9,946,744 | 12,235,212 | 9,098,697 | ||||||||||||||||||||||
Core earnings per common share (non-GAAP): | |||||||||||||||||||||||||||||
Basic | $ | 0.56 | $ | 0.53 | $ | 0.53 | $ | 0.53 | $ | 0.45 | $ | 1.09 | $ | 0.93 | |||||||||||||||
Diluted | $ | 0.55 | $ | 0.52 | $ | 0.53 | $ | 0.52 | $ | 0.45 | $ | 1.07 | $ | 0.92 | |||||||||||||||
CORE RETURN ON AVERAGE ASSETS (2) | |||||||||||||||||||||||||||||
Core net income attributable to QCR Holdings, Inc. common stockholders (non-GAAP) (from above) | $ | 6,895 | $ | 6,194 | $ | 6,276 | $ | 6,200 | $ | 4,470 | $ | 13,090 | $ | 8,374 | |||||||||||||||
Average Assets | $ | 2,640,678 | $ | 2,602,350 | $ | 2,611,276 | $ | 2,563,739 | $ | 2,518,170 | $ | 2,621,514 | $ | 2,512,334 | |||||||||||||||
Core return on average assets (annualized) (non-GAAP) | 1.04 | % | 0.95 | % | 0.96 | % | 0.97 | % | 0.71 | % | 1.00 | % | 0.67 | % | |||||||||||||||
(1) This ratio is a non-GAAP financial measure. The Company's management believes that this measurement is important to many investors in the marketplace who are interested in changes period-to-period in common equity. | |||||||||||||||||||||||||||||
(2) Core net income, core net income attributable to QCR Holdings, Inc. common stockholders, core earnings per common share and core return on average assets are non-GAAP financial measures. The Company's management believes that these measurements are important to investors as they exclude non-recurring income and expense items, therefore, they provide a more realistic run-rate for future periods. | |||||||||||||||||||||||||||||
(3) Nonrecurring items (post-tax) are calculated using an estimated effective tax rate of 35%. | |||||||||||||||||||||||||||||