PINE BLUFF, Ark., July 23, 2018 (GLOBE NEWSWIRE) -- Simmons First National Corporation (NASDAQ:SFNC) today announced record net income of $53.6 million for the quarter ended June 30, 2018, compared to $23.1 million for the same period in 2017, an increase of $30.5 million, or 132.2%. Diluted earnings per share were $0.58, an increase of $0.22, or 61.1%, from the same period in 2017. Included in second quarter 2018 results were $1.1 million in net after-tax merger-related and branch right-sizing costs. Excluding the impact of these items, core earnings were $54.7 million for the quarter ended June 30, 2018, compared to $26.8 million for the quarter ended June 30, 2017, an increase of $27.9 million, or 104.3%. Core diluted earnings per share were $0.59, an increase of $0.17, or 40.5%, from the same period in 2017.
Year-to-date net income for the first half of 2018 was $104.9 million, or $1.13 diluted earnings per share, compared to $45.2 million, or $0.71 diluted earnings per share, for the same period in 2017. Excluding $2.4 million in net after-tax merger-related and branch right sizing costs, year-to-date core earnings for 2018 were $107.3 million, an increase of $58.0 million compared to the same period last year.
“We are pleased to again report record earnings for this quarter building off the strong results in the first quarter,” said George A. Makris, Jr., chairman and CEO.
Makris continued, “The system conversions and integration for our most recent acquisitions are now complete and we are excited to turn our focus on expanding our products and services throughout our larger footprint.”
The Company completed a 2-for-1 stock split effective February 8, 2018. Financial statements, including earnings per share as well as other share-related disclosures, have been adjusted to include the impact of the stock split on all periods presented.
| Selected Highlights: | 2nd Qtr 2018 | 1st Qtr 2018 | 2nd Qtr 2017 | |||
| Net income | $53.6 million | $51.3 million | $23.1 million | |||
| Diluted earnings per share | $0.58 | $0.55 | $0.36 | |||
| Return on avg assets | 1.38% | 1.38% | 1.05% | |||
| Return on avg common equity | 10.05% | 9.90% | 7.65% | |||
| Return on tangible common equity | 18.70% | 18.77% | 12.13% | |||
| Core earnings(1) | $54.7 million | $52.6 million | $26.8 million | |||
| Diluted core earnings per share(1) | $0.59 | $0.57 | $0.42 | |||
| Core return on avg assets(1) | 1.41% | 1.41% | 1.22% | |||
| Core return on avg common equity(1) | 10.26% | 10.15% | 8.87% | |||
| Core return on tangible common equity(1) | 19.06% | 19.23% | 13.99% | |||
| Efficiency ratio | 52.70% | 53.24% | 56.04% | |||
| (1) Core earnings excludes non-core items, and is a non-GAAP measurement. | ||||||
| Loans | |||||||
| 2nd Qtr 2018 | 1st Qtr 2018 | 2nd Qtr 2017 | |||||
| Total loans | $11.4 billion | $11.0 billion | $6.2 billion | ||||
| Legacy loans (all loans excluding loans acquired) | $7.1 billion | $6.3 billion | $5.0 billion | ||||
| Loans acquired | $4.3 billion | $4.7 billion | $1.2 billion | ||||
Total loans, including those acquired, were $11.4 billion at June 30, 2018, an increase of $5.1 billion, or 82.6% from June 30, 2017.
On a linked-quarter basis (June 30, 2018 compared to March 31, 2018), total loans increased $378.6 million, or 3.4%. The increase includes:
- $201 million increase in real estate loans
- $131 million increase in commercial loans
- $58 million increase in seasonal agricultural loan growth
- $12 million increase in other loans
- $23 million decrease in liquidating portfolio (indirect lending and consumer finance)
| Deposits | ||||||
| 2nd Qtr 2018 | 1st Qtr 2018 | 2nd Qtr 2017 | ||||
| Total deposits | $12.0 billion | $11.7 billion | $7.1 billion | |||
| Non-time deposits | $9.6 billion | $9.5 billion | $5.8 billion | |||
| Time deposits | $2.4 billion | $2.2 billion | $1.3 billion | |||
At June 30, 2018, total deposits were $12.0 billion, an increase of 68.3%, compared to the same period in 2017 and a 2.5% increase from March 31, 2018. The increase is from continued focus on core deposits as a funding source for asset growth and the recent acquisitions. Total non-time deposits increased 65.7% compared to the same period in 2017, and comprised 80.3% of total deposits.
Since last quarter, the Federal Reserve Board increased the Fed Funds target rate by 25 basis points. The Company’s deposit beta was 40% and the core loan beta was 36%. Looking back to March 2017, the Federal Reserve has increased the target rate by 100 basis points. The Company’s deposit beta was 51% and the core loan beta was 45% during the same period.
| Net Interest Income | ||||||||||
| 2nd Qtr 2018 | 1st Qtr 2018 | 4th Qtr 2017 | 3rd Qtr 2017 | 2nd Qtr 2017 | ||||||
| Loan yield (1) | 5.40 | % | 5.38 | % | 5.39 | % | 4.91 | % | 4.96 | % |
| Core loan yield (1) (2) | 5.04 | % | 4.95 | % | 4.75 | % | 4.72 | % | 4.63 | % |
| Security yield (1) | 2.75 | % | 2.67 | % | 2.62 | % | 2.64 | % | 2.81 | % |
| Cost of interest bearing deposits | 0.84 | % | 0.74 | % | 0.63 | % | 0.43 | % | 0.36 | % |
| Cost of borrowed funds | 2.38 | % | 1.70 | % | 1.78 | % | 1.52 | % | 1.48 | % |
| Net interest margin (1) | 3.99 | % | 4.17 | % | 4.21 | % | 3.91 | % | 4.04 | % |
| Core net interest margin (1) (2) | 3.70 | % | 3.82 | % | 3.70 | % | 3.77 | % | 3.79 | % |
| (1) Fully tax equivalent. | ||||||||||
| (2) Core loan yield and core net interest margin exclude accretion, and are non-GAAP measurements. | ||||||||||
The Company’s net interest income for the second quarter of 2018 was $136.8 million, an increase of $60.0 million, or 78.2%, from the same period of 2017. Included in interest income was the yield accretion recognized on loans acquired of $10.1 million and $4.8 million for the second quarters of 2018 and 2017, respectively. Yield accretion was $3.7 million higher than projected during the quarter due to accelerated cash flows of acquired loans. Based on its cash flow projections, the Company expects total accretion for 2018 of approximately $30 million.
Net interest margin was 3.99% for the quarter ended June 30, 2018, an 18 basis point decrease from the first quarter. The Company’s core net interest margin, excluding the accretion, was 3.70% for the second quarter of 2018, a 12 basis point decrease from March 31, 2018. Cost of interest bearing deposits was 0.84% for the second quarter of 2018, a 48 basis point increase from June 30, 2017 and a 10 basis point increase from March 31, 2018.
The subordinated debt issuance at the end of the first quarter had a 5 basis point impact on the Company’s second quarter net interest margin. The timing of existing subordinated debt prepayment had an additional 5 basis point impact.
Non-Interest Income
Non-interest income for the second quarter 2018 was $38.0 million, an increase of $2.3 million compared to the second quarter of 2017. The increase was primarily due to additional trust income, service charge and fee income resulting from the acquisitions. This increase was partially offset by a $2.2 million decrease in gain on sale of securities compared to the same quarter last year.
Non-Interest Expense
Non-interest expense for the second quarter of 2018 was $98.5 million, an increase of $27.1 million compared to the second quarter of 2017. Included in this quarter were $1.5 million of pre-tax merger-related expenses and branch rightsizing costs. Excluding these expenses, core non-interest expense was $97.0 million.
The increases during the quarter were driven by incremental increases in operating expenses related to the additions of Bank SNB and Southwest Bank during the fourth quarter of 2017. The efficiency ratio for the second quarter 2018 was 52.70%.
Income tax expense in the second quarter included a $2.0 million discrete tax benefit related to tax accounting for equity compensation.
| Asset Quality | ||||||
| 2nd Qtr 2018 | 1st Qtr 2018 | 2nd Qtr 2017 | ||||
| Allowance for loan losses to total loans | 0.73% | 0.75% | 0.83% | |||
| Allowance for loan losses to non-performing loans | 115% | 99% | 72% | |||
| Non-performing loans to total loans | 0.63% | 0.76% | 1.15% | |||
| Net charge-off ratio (annualized) | 0.17% | 0.24% | 0.23% | |||
| Net charge-off ratio excluding credit cards | 0.13% | 0.20% | 0.19% | |||
All loans acquired are recorded at their discounted net present value; therefore, they are excluded from the computations of the asset quality ratios for the legacy loan portfolio, except for their inclusion in total assets.
At June 30, 2018, the allowance for loan losses for legacy loans was $51.7 million. The allowance for loan losses for loans acquired was $2.1 million and the acquired loan discount credit mark was $68.3 million. The allowances for loan losses and credit marks provide a total of $122.1 million of coverage, which equates to a total coverage ratio of 1.1% of gross loans. The ratio of credit mark and related allowance to loans acquired was 1.6%.
Provision for loan losses for the second quarter of 2018 was $9.0 million which includes an increase due to strong legacy loan growth as well as increased loan migration during the quarter from the fourth quarter of 2017 acquisitions, which is consistent with the Company’s previous guidance.
Foreclosed Assets and Other Real Estate Owned
At June 30, 2018, foreclosed assets and other real estate owned were $30.5 million, an increase of $4.5 million, or 17.3%, compared to the same period in 2017 and an increase of $1.4 million, or 4.7% from March 31, 2018. The composition of these assets is divided into three types:
| 2nd Qtr 2018 | 1st Qtr 2018 | 2nd Qtr 2017 | ||||
| Closed bank branches, branch sites & | ||||||
| associate relocation | $7.2 million | $8.1 million | $8.7 million | |||
| Foreclosed assets - acquired | $13.2 million | $14.9 million | $12.0 million | |||
| Foreclosed assets - legacy | $10.1 million | $6.1 million | $5.3 million | |||
| Capital | ||||||
| 2nd Qtr 2018 | 1st Qtr 2018 | 2nd Qtr 2017 | ||||
| Stockholders’ equity to total assets | 13.3% | 13.5% | 13.6% | |||
| Tangible common equity to tangible assets | 7.9% | 7.9% | 9.2% | |||
| Regulatory tier 1 leverage ratio | 8.6% | 8.6% | 10.8% | |||
| Regulatory total risk-based capital ratio | 13.7% | 14.1% | 13.7% | |||
At June 30, 2018, common stockholders' equity was $2.1 billion, book value per share was $23.26 and tangible book value per share was $13.05. Asset growth due to the subordinated debt offering and the timing related to paying off approximately $104 million in parent company debt reduced Tangible Common Equity 6 basis points.
Simmons First National Corporation
Simmons First National Corporation is a financial holding company, headquartered in Pine Bluff, Arkansas, with total assets of $16.2 billion as of June 30, 2018 conducting financial operations throughout Arkansas, Colorado, Kansas, Missouri, Oklahoma, Tennessee and Texas. The Company, through its subsidiaries, offers comprehensive financial solutions delivered with a client-centric approach. The Company’s common stock trades on the NASDAQ Global Select Market under the symbol “SFNC.”
Conference Call
Management will conduct a live conference call to review this information beginning at 9:00 a.m. CDT on Tuesday, July 24, 2018. Interested persons can listen to this call by dialing toll-free 1-866-298-7926 (United States and Canada only) and asking for the Simmons First National Corporation conference call, conference ID 4496437. In addition, the call will be available live or in recorded version on the Company’s website at www.simmonsbank.com.
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles (GAAP). The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance. These measures typically adjust GAAP performance measures to include the tax benefit associated with revenue items that are tax-exempt, as well as adjust income available to common shareholders for certain significant non-core activities or nonrecurring transactions. Since the presentation of these GAAP performance measures and their impact differ between companies, management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.
Forward-Looking Statements
Statements in this news release that are not historical facts should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any forward-looking statement speaks only as of the date of this news release, and we undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release. By nature, forward-looking statements involve inherent risk and uncertainties. Various factors, including, but not limited to, economic conditions, credit quality, interest rates, loan demand, changes in the assumptions used in making the forward-looking statements, and the Company’s ability to manage and successfully integrate its mergers and acquisitions could cause actual results to differ materially from those contemplated by the forward-looking statements. Additional information on factors that might affect Simmons First National Corporation’s financial results is included in its Form 10-K filing with the Securities and Exchange Commission.
FOR MORE INFORMATION CONTACT:
STEPHEN C. MASSANELLI
EVP, Chief Administrative Officer and Investor Relations Officer
Simmons First National Corporation
(870) 541-1000
| Simmons First National Corporation | SFNC | ||||||||||||||
| Consolidated End of Period Balance Sheets | |||||||||||||||
| For the Quarters Ended | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Jun 30 | ||||||||||
| (Unaudited) | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||
| ($ in thousands) | |||||||||||||||
| ASSETS | |||||||||||||||
| Cash and non-interest bearing balances due from banks | $ | 162,567 | $ | 170,811 | $ | 205,025 | $ | 108,675 | $ | 112,567 | |||||
| Interest bearing balances due from banks and federal funds sold | 781,279 | 688,853 | 393,017 | 323,615 | 217,047 | ||||||||||
| Cash and cash equivalents | 943,846 | 859,664 | 598,042 | 432,290 | 329,614 | ||||||||||
| Interest bearing balances due from banks - time | 2,974 | 3,069 | 3,314 | 4,059 | 6,057 | ||||||||||
| Investment securities - held-to-maturity | 333,503 | 352,756 | 368,058 | 406,033 | 419,003 | ||||||||||
| Investment securities - available-for-sale | 1,938,644 | 1,830,113 | 1,589,517 | 1,317,420 | 1,190,600 | ||||||||||
| Mortgage loans held for sale | 39,812 | 17,708 | 24,038 | 12,614 | 16,266 | ||||||||||
| Assets held in trading accounts | - | - | - | 49 | 50 | ||||||||||
| Other assets held for sale | 14,898 | 24,784 | 165,780 | 182,378 | - | ||||||||||
| Loans: | |||||||||||||||
| Legacy loans | 7,133,461 | 6,290,383 | 5,705,609 | 5,211,312 | 5,000,572 | ||||||||||
| Allowance for loan losses | (51,732 | ) | (47,207 | ) | (41,668 | ) | (42,717 | ) | (41,379 | ) | |||||
| Loans acquired, net of discount and allowance | 4,232,434 | 4,696,945 | 5,074,076 | 1,092,039 | 1,224,739 | ||||||||||
| Net loans | 11,314,163 | 10,940,121 | 10,738,017 | 6,260,634 | 6,183,932 | ||||||||||
| Premises and equipment | 288,777 | 289,355 | 287,249 | 224,376 | 230,641 | ||||||||||
| Foreclosed assets and other real estate owned | 30,503 | 29,140 | 32,118 | 31,477 | 26,012 | ||||||||||
| Interest receivable | 44,266 | 42,129 | 43,528 | 30,749 | 27,337 | ||||||||||
| Bank owned life insurance | 191,575 | 186,473 | 185,984 | 148,984 | 148,134 | ||||||||||
| Goodwill | 845,687 | 845,687 | 842,651 | 375,731 | 379,437 | ||||||||||
| Other intangible assets | 96,720 | 99,504 | 106,071 | 55,501 | 58,528 | ||||||||||
| Other assets | 80,165 | 76,806 | 71,439 | 53,075 | 52,697 | ||||||||||
| Total assets | $ | 16,165,533 | $ | 15,597,309 | $ | 15,055,806 | $ | 9,535,370 | $ | 9,068,308 | |||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||||
| Deposits: | |||||||||||||||
| Non-interest bearing transaction accounts | $ | 2,683,489 | $ | 2,734,287 | $ | 2,665,249 | $ | 1,669,860 | $ | 1,650,986 | |||||
| Interest bearing transaction accounts and savings deposits | 6,916,520 | 6,720,754 | 6,494,896 | 4,344,779 | 4,141,426 | ||||||||||
| Time deposits | 2,353,439 | 2,201,874 | 1,932,730 | 1,310,951 | 1,311,123 | ||||||||||
| Total deposits | 11,953,448 | 11,656,915 | 11,092,875 | 7,325,590 | 7,103,535 | ||||||||||
| Federal funds purchased and securities sold | |||||||||||||||
| under agreements to repurchase | 99,801 | 120,909 | 122,444 | 121,687 | 121,419 | ||||||||||
| Other borrowings | 1,451,811 | 1,140,986 | 1,380,024 | 522,541 | 474,962 | ||||||||||
| Subordinated notes and debentures | 413,337 | 468,465 | 140,565 | 67,418 | 67,312 | ||||||||||
| Other liabilities held for sale | 1,840 | 2,781 | 157,366 | 176,964 | - | ||||||||||
| Accrued interest and other liabilities | 98,388 | 98,202 | 77,968 | 63,971 | 67,004 | ||||||||||
| Total liabilities | 14,018,625 | 13,488,258 | 12,971,242 | 8,278,171 | 7,834,232 | ||||||||||
| Stockholders' equity: | |||||||||||||||
| Common stock | 923 | 922 | 920 | 644 | 644 | ||||||||||
| Surplus | 1,594,342 | 1,590,086 | 1,586,034 | 763,121 | 761,432 | ||||||||||
| Undivided profits | 591,826 | 552,105 | 514,874 | 504,085 | 483,322 | ||||||||||
| Accumulated other comprehensive loss: | |||||||||||||||
| Unrealized depreciation on AFS securities | (40,183 | ) | (34,062 | ) | (17,264 | ) | (10,651 | ) | (11,322 | ) | |||||
| Total stockholders' equity | 2,146,908 | 2,109,051 | 2,084,564 | 1,257,199 | 1,234,076 | ||||||||||
| Total liabilities and stockholders' equity | $ | 16,165,533 | $ | 15,597,309 | $ | 15,055,806 | $ | 9,535,370 | $ | 9,068,308 | |||||
| Page 1 | |||||||||||||||
| Simmons First National Corporation | SFNC | ||||||||||||||
| Consolidated Statements of Income - Quarter-to-Date | |||||||||||||||
| For the Quarters Ended | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Jun 30 | ||||||||||
| (Unaudited) | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||
| ($ in thousands, except per share data) | |||||||||||||||
| INTEREST INCOME | |||||||||||||||
| Loans | $ | 150,253 | $ | 143,350 | $ | 132,617 | $ | 77,457 | $ | 73,549 | |||||
| Interest bearing balances due from banks and federal funds sold | 1,414 | 1,009 | 947 | 650 | 214 | ||||||||||
| Investment securities | 14,296 | 12,622 | 11,456 | 9,218 | 9,990 | ||||||||||
| Mortgage loans held for sale | 305 | 158 | 175 | 159 | 145 | ||||||||||
| TOTAL INTEREST INCOME | 166,268 | 157,139 | 145,195 | 87,484 | 83,898 | ||||||||||
| INTEREST EXPENSE | |||||||||||||||
| Time deposits | 6,175 | 4,842 | 3,944 | 2,110 | 1,832 | ||||||||||
| Other deposits | 12,286 | 10,755 | 8,762 | 3,920 | 2,984 | ||||||||||
| Federal funds purchased and securities | |||||||||||||||
| sold under agreements to repurchase | 88 | 110 | 97 | 83 | 92 | ||||||||||
| Other borrowings | 5,141 | 5,139 | 3,993 | 1,875 | 1,559 | ||||||||||
| Subordinated notes and debentures | 5,741 | 1,327 | 1,480 | 677 | 619 | ||||||||||
| TOTAL INTEREST EXPENSE | 29,431 | 22,173 | 18,276 | 8,665 | 7,086 | ||||||||||
| NET INTEREST INCOME | 136,837 | 134,966 | 126,919 | 78,819 | 76,812 | ||||||||||
| Provision for loan losses | 9,033 | 9,150 | 9,601 | 5,462 | 7,023 | ||||||||||
| NET INTEREST INCOME AFTER PROVISION | |||||||||||||||
| FOR LOAN LOSSES | 127,804 | 125,816 | 117,318 | 73,357 | 69,789 | ||||||||||
| NON-INTEREST INCOME | |||||||||||||||
| Trust income | 5,622 | 5,249 | 6,020 | 4,225 | 4,113 | ||||||||||
| Service charges on deposit accounts | 10,063 | 10,345 | 10,587 | 8,907 | 8,483 | ||||||||||
| Other service charges and fees | 2,017 | 2,750 | 2,774 | 2,433 | 2,515 | ||||||||||
| Mortgage and SBA lending income | 3,130 | 4,445 | 3,713 | 3,219 | 3,961 | ||||||||||
| Investment banking income | 814 | 834 | 786 | 680 | 637 | ||||||||||
| Debit and credit card fees | 10,105 | 8,796 | 8,801 | 8,864 | 8,659 | ||||||||||
| Bank owned life insurance income | 1,102 | 1,103 | 1,101 | 725 | 859 | ||||||||||
| (Loss) gain on sale of securities, net | (7 | ) | 6 | (1,243 | ) | 3 | 2,236 | ||||||||
| Other income | 5,202 | 4,007 | 4,090 | 7,276 | 4,281 | ||||||||||
| TOTAL NON-INTEREST INCOME | 38,048 | 37,535 | 36,629 | 36,332 | 35,744 | ||||||||||
| NON-INTEREST EXPENSE | |||||||||||||||
| Salaries and employee benefits | 55,678 | 56,357 | 49,288 | 35,285 | 34,205 | ||||||||||
| Occupancy expense, net | 7,921 | 6,960 | 6,700 | 4,928 | 4,868 | ||||||||||
| Furniture and equipment expense | 4,020 | 4,403 | 5,533 | 4,840 | 4,550 | ||||||||||
| Other real estate and foreclosure expense | 1,382 | 1,020 | 865 | 1,071 | 517 | ||||||||||
| Deposit insurance | 1,856 | 2,128 | 1,216 | 1,020 | 780 | ||||||||||
| Merger-related costs | 1,465 | 1,711 | 14,044 | 752 | 6,603 | ||||||||||
| Other operating expenses | 26,185 | 25,494 | 30,844 | 18,263 | 19,885 | ||||||||||
| TOTAL NON-INTEREST EXPENSE | 98,507 | 98,073 | 108,490 | 66,159 | 71,408 | ||||||||||
| NET INCOME BEFORE INCOME TAXES | 67,345 | 65,278 | 45,457 | 43,530 | 34,125 | ||||||||||
| Provision for income taxes | 13,783 | 13,966 | 26,554 | 14,678 | 11,060 | ||||||||||
| NET INCOME | $ | 53,562 | $ | 51,312 | $ | 18,903 | $ | 28,852 | $ | 23,065 | |||||
| BASIC EARNINGS PER SHARE | $ | 0.58 | $ | 0.56 | $ | 0.22 | $ | 0.45 | $ | 0.36 | |||||
| DILUTED EARNINGS PER SHARE | $ | 0.58 | $ | 0.55 | $ | 0.22 | $ | 0.44 | $ | 0.36 | |||||
| Page 2 | |||||||||||||||
| Simmons First National Corporation | SFNC | ||||||||||||||
| Consolidated Risk-Based Capital | |||||||||||||||
| For the Quarters Ended | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Jun 30 | ||||||||||
| (Unaudited) | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||
| ($ in thousands) | |||||||||||||||
| Tier 1 capital | |||||||||||||||
| Stockholders' equity | $ | 2,146,908 | $ | 2,109,051 | $ | 2,084,564 | $ | 1,257,199 | $ | 1,234,076 | |||||
| Trust preferred securities, net allowable | - | - | - | 67,418 | 67,312 | ||||||||||
| Disallowed intangible assets, net of deferred tax | (917,050 | ) | (918,161 | ) | (902,371 | ) | (401,419 | ) | (406,990 | ) | |||||
| Unrealized loss on AFS securities | 40,183 | 34,062 | 17,264 | 10,651 | 11,322 | ||||||||||
| Total Tier 1 capital | 1,270,041 | 1,224,952 | 1,199,457 | 933,849 | 905,720 | ||||||||||
| Tier 2 capital | |||||||||||||||
| Qualifying unrealized gain on AFS equity securities | 1 | 8 | 1 | 1 | 1 | ||||||||||
| Trust preferred securities and subordinated debt | 413,337 | 468,466 | 140,565 | - | - | ||||||||||
| Qualifying allowance for loan losses and | |||||||||||||||
| reserve for unfunded commitments | 60,691 | 54,436 | 48,947 | 46,709 | 45,369 | ||||||||||
| Total Tier 2 capital | 474,029 | 522,910 | 189,513 | 46,710 | 45,370 | ||||||||||
| Total risk-based capital | $ | 1,744,070 | $ | 1,747,862 | $ | 1,388,970 | $ | 980,559 | $ | 951,090 | |||||
| Common equity | |||||||||||||||
| Tier 1 capital | $ | 1,270,041 | $ | 1,224,952 | $ | 1,199,457 | $ | 933,849 | $ | 905,720 | |||||
| Less: Trust preferred securities | - | - | - | (67,418 | ) | (67,312 | ) | ||||||||
| Total common equity | $ | 1,270,041 | $ | 1,224,952 | $ | 1,199,457 | $ | 866,431 | $ | 838,408 | |||||
| Risk weighted assets | $ | 12,713,093 | $ | 12,417,233 | $ | 12,234,160 | $ | 7,239,923 | $ | 6,925,727 | |||||
| Adjusted average assets for leverage ratio | $ | 14,714,205 | $ | 14,179,390 | $ | 13,016,478 | $ | 8,789,175 | $ | 8,424,763 | |||||
| Ratios at end of quarter | |||||||||||||||
| Equity to assets | 13.28 | % | 13.52 | % | 13.85 | % | 13.18 | % | 13.61 | % | |||||
| Tangible common equity to tangible assets (1) | 7.91 | % | 7.94 | % | 8.05 | % | 9.07 | % | 9.22 | % | |||||
| Common equity Tier 1 ratio (CET1) | 9.99 | % | 9.86 | % | 9.80 | % | 11.97 | % | 12.11 | % | |||||
| Tier 1 leverage ratio | 8.63 | % | 8.64 | % | 9.21 | % | 10.62 | % | 10.75 | % | |||||
| Tier 1 risk-based capital ratio | 9.99 | % | 9.86 | % | 9.80 | % | 12.90 | % | 13.08 | % | |||||
| Total risk-based capital ratio | 13.72 | % | 14.08 | % | 11.35 | % | 13.54 | % | 13.73 | % | |||||
| (1) Calculations of tangible common equity to tangible assets and the reconciliations to GAAP are included in the schedules accompanying this release. | |||||||||||||||
| Page 3 | |||||||||||||||
| Simmons First National Corporation | SFNC | ||||||||||||||
| Consolidated Loans and Investments | |||||||||||||||
| For the Quarters Ended | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Jun 30 | ||||||||||
| (Unaudited) | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||
| ($ in thousands) | |||||||||||||||
| Legacy Loan Portfolio - End of Period (1) | |||||||||||||||
| Consumer | |||||||||||||||
| Credit cards | $ | 180,352 | $ | 176,602 | $ | 185,422 | $ | 176,316 | $ | 176,953 | |||||
| Other consumer | 277,330 | 284,285 | 280,094 | 317,946 | 366,136 | ||||||||||
| Total consumer | 457,682 | 460,887 | 465,516 | 494,262 | 543,089 | ||||||||||
| Real Estate | |||||||||||||||
| Construction | 967,720 | 786,077 | 614,155 | 515,274 | 457,896 | ||||||||||
| Single-family residential | 1,314,787 | 1,193,464 | 1,094,633 | 1,048,403 | 1,014,412 | ||||||||||
| Other commercial | 2,816,420 | 2,611,358 | 2,530,824 | 2,231,223 | 2,089,707 | ||||||||||
| Total real estate | 5,098,927 | 4,590,899 | 4,239,612 | 3,794,900 | 3,562,015 | ||||||||||
| Commercial | |||||||||||||||
| Commercial | 1,237,910 | 971,704 | 825,217 | 688,960 | 678,932 | ||||||||||
| Agricultural | 187,006 | 128,247 | 148,302 | 207,849 | 191,345 | ||||||||||
| Total commercial | 1,424,916 | 1,099,951 | 973,519 | 896,809 | 870,277 | ||||||||||
| Other | 151,936 | 138,646 | 26,962 | 25,341 | 25,191 | ||||||||||
| Total Loans | $ | 7,133,461 | $ | 6,290,383 | $ | 5,705,609 | $ | 5,211,312 | $ | 5,000,572 | |||||
| (1) Excludes all acquired loans. | |||||||||||||||
| Investment Securities - End of Period | |||||||||||||||
| Held-to-Maturity | |||||||||||||||
| U.S. Government agencies | $ | 36,976 | $ | 46,961 | $ | 46,945 | $ | 66,928 | $ | 67,912 | |||||
| Mortgage-backed securities | 14,645 | 15,404 | 16,132 | 16,972 | 17,882 | ||||||||||
| State and political subdivisions | 279,787 | 286,901 | 301,491 | 320,116 | 331,249 | ||||||||||
| Other securities | 2,095 | 3,490 | 3,490 | 2,017 | 1,960 | ||||||||||
| Total held-to-maturity | 333,503 | 352,756 | 368,058 | 406,033 | 419,003 | ||||||||||
| Available-for-Sale | |||||||||||||||
| U.S. Treasury | $ | - | $ | - | $ | - | $ | - | $ | 19,997 | |||||
| U.S. Government agencies | 145,767 | 149,804 | 139,724 | 208,220 | 147,619 | ||||||||||
| Mortgage-backed securities | 1,395,231 | 1,356,179 | 1,187,317 | 959,698 | 878,205 | ||||||||||
| State and political subdivisions | 245,335 | 185,888 | 143,165 | 84,822 | 83,672 | ||||||||||
| FHLB stock | 72,042 | 58,177 | 58,914 | 24,415 | 21,772 | ||||||||||
| Other securities | 80,269 | 80,065 | 60,397 | 40,265 | 39,335 | ||||||||||
| Total available-for-sale | 1,938,644 | 1,830,113 | 1,589,517 | 1,317,420 | 1,190,600 | ||||||||||
| Total investment securities | $ | 2,272,147 | $ | 2,182,869 | $ | 1,957,575 | $ | 1,723,453 | $ | 1,609,603 | |||||
| Fair value - HTM investment securities | $ | 334,857 | $ | 354,649 | $ | 373,298 | $ | 412,140 | $ | 425,263 | |||||
| Investment Securities - QTD Average | |||||||||||||||
| Taxable securities | $ | 1,750,172 | $ | 1,618,270 | $ | 1,569,173 | $ | 1,229,172 | $ | 1,244,071 | |||||
| Tax exempt securities | 514,838 | 460,675 | 446,040 | 409,062 | 467,420 | ||||||||||
| Total investment securities - QTD average | $ | 2,265,010 | $ | 2,078,945 | $ | 2,015,213 | $ | 1,638,234 | $ | 1,711,491 | |||||
| Page 4 | |||||||||||||||
| Simmons First National Corporation | SFNC | |||||||||||||||
| Consolidated Loans and Credit Coverage | ||||||||||||||||
| For the Quarters Ended | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Jun 30 | |||||||||||
| (Unaudited) | 2018 | 2018 | 2017 | 2017 | 2017 | |||||||||||
| ($ in thousands) | ||||||||||||||||
| LOANS | ||||||||||||||||
| Legacy loans | $ | 7,133,461 | $ | 6,290,383 | $ | 5,705,609 | $ | 5,211,312 | $ | 5,000,572 | ||||||
| Allowance for loan losses (legacy loans) | (51,732 | ) | (47,207 | ) | (41,668 | ) | (42,717 | ) | (41,379 | ) | ||||||
| Legacy loans (net of allowance) | 7,081,729 | 6,243,176 | 5,663,941 | 5,168,595 | 4,959,193 | |||||||||||
| Loans acquired | 4,302,760 | 4,776,439 | 5,163,769 | 1,117,424 | 1,253,539 | |||||||||||
| Credit discount | (68,282 | ) | (79,087 | ) | (89,275 | ) | (24,994 | ) | (28,409 | ) | ||||||
| Allowance for loan losses (loans acquired) | (2,044 | ) | (407 | ) | (418 | ) | (391 | ) | (391 | ) | ||||||
| Loans acquired (net of discount and allowance) | 4,232,434 | 4,696,945 | 5,074,076 | 1,092,039 | 1,224,739 | |||||||||||
| Net loans | $ | 11,314,163 | $ | 10,940,121 | $ | 10,738,017 | $ | 6,260,634 | $ | 6,183,932 | ||||||
| Loan Coverage Ratios | ||||||||||||||||
| Allowance for loan losses to legacy loans | 0.73 | % | 0.75 | % | 0.73 | % | 0.82 | % | 0.83 | % | ||||||
| Discount for credit losses and allowance on loans acquired | ||||||||||||||||
| to total loans acquired plus discount for credit losses | ||||||||||||||||
| and allowance on loans acquired (non-GAAP) (1) | 1.63 | % | 1.66 | % | 1.74 | % | 2.27 | % | 2.30 | % | ||||||
| Total allowance and credit coverage (non-GAAP) (1) | 1.07 | % | 1.14 | % | 1.21 | % | 1.08 | % | 1.12 | % | ||||||
| (1) Calculations of the non-GAAP loan coverage ratios and the reconciliations to GAAP are included in the schedules accompanying this release. | ||||||||||||||||
| Page 5 | ||||||||||||||||
| Simmons First National Corporation | SFNC | ||||||||||||||
| Consolidated Allowance and Asset Quality | |||||||||||||||
| For the Quarters Ended | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Jun 30 | ||||||||||
| (Unaudited) | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||
| ($ in thousands) | |||||||||||||||
| Allowance for Loan Losses (Legacy Loans) | |||||||||||||||
| Balance, beginning of quarter | $ | 47,207 | $ | 41,668 | $ | 42,717 | $ | 41,379 | $ | 37,865 | |||||
| Loans charged off | |||||||||||||||
| Credit cards | 1,012 | 999 | 943 | 1,017 | 901 | ||||||||||
| Other consumer | 1,366 | 1,056 | 781 | 819 | 993 | ||||||||||
| Real estate | 161 | 455 | 4,725 | 896 | 1,712 | ||||||||||
| Commercial | 790 | 1,761 | 4,754 | 2,442 | 349 | ||||||||||
| Total loans charged off | 3,329 | 4,271 | 11,203 | 5,174 | 3,955 | ||||||||||
| Recoveries of loans previously charged off | |||||||||||||||
| Credit cards | 286 | 263 | 233 | 275 | 277 | ||||||||||
| Other consumer | 133 | 94 | 468 | 445 | 636 | ||||||||||
| Real estate | 112 | 302 | 233 | 309 | 216 | ||||||||||
| Commercial | 59 | 69 | 20 | 21 | 32 | ||||||||||
| Total recoveries | 590 | 728 | 954 | 1,050 | 1,161 | ||||||||||
| Net loans charged off | 2,739 | 3,543 | 10,249 | 4,124 | 2,794 | ||||||||||
| Provision for loan losses | 7,264 | 9,082 | 9,200 | 5,462 | 6,308 | ||||||||||
| Balance, end of quarter | $ | 51,732 | $ | 47,207 | $ | 41,668 | $ | 42,717 | $ | 41,379 | |||||
| Non-performing assets (1) (2) | |||||||||||||||
| Non-performing loans | |||||||||||||||
| Nonaccrual loans | $ | 44,548 | $ | 47,395 | $ | 45,642 | $ | 54,439 | $ | 57,127 | |||||
| Loans past due 90 days or more | 303 | 336 | 520 | 232 | 281 | ||||||||||
| Total non-performing loans | 44,851 | 47,731 | 46,162 | 54,671 | 57,408 | ||||||||||
| Other non-performing assets | |||||||||||||||
| Foreclosed assets and other real estate owned (2) | 30,503 | 29,140 | 32,118 | 31,477 | 26,012 | ||||||||||
| Other non-performing assets | 573 | 794 | 675 | 639 | 485 | ||||||||||
| Total other non-performing assets | 31,076 | 29,934 | 32,793 | 32,116 | 26,497 | ||||||||||
| Total non-performing assets | $ | 75,927 | $ | 77,665 | $ | 78,955 | $ | 86,787 | $ | 83,905 | |||||
| Performing TDRs (troubled debt restructurings) | $ | 6,367 | $ | 6,459 | $ | 7,107 | $ | 9,212 | $ | 8,794 | |||||
| Ratios (1) (2) | |||||||||||||||
| Allowance for loan losses to total loans | 0.73 | % | 0.75 | % | 0.73 | % | 0.82 | % | 0.83 | % | |||||
| Allowance for loan losses to non-performing loans | 115 | % | 99 | % | 90 | % | 78 | % | 72 | % | |||||
| Non-performing loans to total loans | 0.63 | % | 0.76 | % | 0.81 | % | 1.05 | % | 1.15 | % | |||||
| Non-performing assets (including performing TDRs) | |||||||||||||||
| to total assets | 0.51 | % | 0.54 | % | 0.57 | % | 1.01 | % | 1.02 | % | |||||
| Non-performing assets to total assets | 0.47 | % | 0.50 | % | 0.52 | % | 0.91 | % | 0.93 | % | |||||
| Annualized net charge offs to total loans | 0.17 | % | 0.24 | % | 0.53 | % | 0.32 | % | 0.23 | % | |||||
| Annualized net credit card charge offs to | |||||||||||||||
| total credit card loans | 1.60 | % | 1.63 | % | 1.54 | % | 1.65 | % | 1.42 | % | |||||
| Annualized net charge offs to total loans | |||||||||||||||
| (excluding credit cards) | 0.13 | % | 0.20 | % | 0.51 | % | 0.27 | % | 0.19 | % | |||||
| (1) Excludes all acquired loans, except for their inclusion in total assets. | |||||||||||||||
| (2) Includes acquired foreclosed assets and acquired other real estate owned. | |||||||||||||||
| Page 6 | |||||||||||||||
| Simmons First National Corporation | SFNC | |||||||||||||||||||||||||
| Consolidated - Average Balance Sheet and Net Interest Income Analysis | ||||||||||||||||||||||||||
| For the Quarters Ended | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Three Months Ended Jun 2018 | Three Months Ended Mar 2018 | Three Months Ended Jun 2017 | ||||||||||||||||||||||||
| ($ in thousands) | Average Balance | Income/ Expense | Yield/ Rate | Average Balance | Income/ Expense | Yield/ Rate | Average Balance | Income/ Expense | Yield/ Rate | |||||||||||||||||
| ASSETS | ||||||||||||||||||||||||||
| Earning assets: | ||||||||||||||||||||||||||
| Interest bearing balances due from banks | ||||||||||||||||||||||||||
| and federal funds sold | $ | 422,987 | $ | 1,414 | 1.34 | % | $ | 338,505 | $ | 1,009 | 1.21 | % | $ | 163,396 | $ | 214 | 0.53 | % | ||||||||
| Investment securities - taxable | 1,982,105 | 10,764 | 2.18 | % | 1,785,874 | 9,599 | 2.18 | % | 1,374,261 | 6,874 | 2.01 | % | ||||||||||||||
| Investment securities - non-taxable (FTE) | 282,905 | 4,771 | 6.76 | % | 293,071 | 4,083 | 5.65 | % | 337,230 | 5,118 | 6.09 | % | ||||||||||||||
| Mortgage loans held for sale | 28,688 | 305 | 4.26 | % | 14,775 | 158 | 4.34 | % | 12,250 | 145 | 4.75 | % | ||||||||||||||
| Assets held in trading accounts | - | - | 0.00 | % | - | - | 0.00 | % | 52 | - | 0.00 | % | ||||||||||||||
| Loans, including acquired loans | 11,159,872 | 150,322 | 5.40 | % | 10,819,324 | 143,420 | 5.38 | % | 5,954,019 | 73,629 | 4.96 | % | ||||||||||||||
| Total interest earning assets (FTE) | 13,876,557 | 167,576 | 4.84 | % | 13,251,549 | 158,269 | 4.84 | % | 7,841,208 | 85,980 | 4.40 | % | ||||||||||||||
| Non-earning assets | 1,704,140 | 1,836,661 | 971,252 | |||||||||||||||||||||||
| Total assets | $ | 15,580,697 | $ | 15,088,210 | $ | 8,812,460 | ||||||||||||||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||||||||
| Interest bearing liabilities: | ||||||||||||||||||||||||||
| Interest bearing transaction and | ||||||||||||||||||||||||||
| savings accounts | $ | 6,570,471 | $ | 12,286 | 0.75 | % | $ | 6,579,295 | $ | 10,755 | 0.66 | % | $ | 4,069,179 | $ | 2,984 | 0.29 | % | ||||||||
| Time deposits | 2,233,673 | 6,175 | 1.11 | % | 2,003,668 | 4,842 | 0.98 | % | 1,277,336 | 1,832 | 0.58 | % | ||||||||||||||
| Total interest bearing deposits | 8,804,144 | 18,461 | 0.84 | % | 8,582,963 | 15,597 | 0.74 | % | 5,346,515 | 4,816 | 0.36 | % | ||||||||||||||
| Federal funds purchased and securities | ||||||||||||||||||||||||||
| sold under agreement to repurchase | 107,205 | 88 | 0.33 | % | 120,443 | 110 | 0.37 | % | 115,101 | 92 | 0.32 | % | ||||||||||||||
| Other borrowings | 1,273,135 | 5,141 | 1.62 | % | 1,282,527 | 5,139 | 1.63 | % | 434,584 | 1,559 | 1.44 | % | ||||||||||||||
| Subordinated notes and debentures | 466,612 | 5,741 | 4.93 | % | 162,813 | 1,327 | 3.31 | % | 64,019 | 619 | 3.88 | % | ||||||||||||||
| Total interest bearing liabilities | 10,651,096 | 29,431 | 1.11 | % | 10,148,746 | 22,173 | 0.89 | % | 5,960,219 | 7,086 | 0.48 | % | ||||||||||||||
| Non-interest bearing liabilities: | ||||||||||||||||||||||||||
| Non-interest bearing deposits | 2,705,677 | 2,632,182 | 1,597,550 | |||||||||||||||||||||||
| Other liabilities | 86,827 | 204,230 | 45,348 | |||||||||||||||||||||||
| Total liabilities | 13,443,600 | 12,985,158 | 7,603,117 | |||||||||||||||||||||||
| Stockholders' equity | 2,137,097 | 2,103,052 | 1,209,343 | |||||||||||||||||||||||
| Total liabilities and stockholders' equity | $ | 15,580,697 | $ | 15,088,210 | $ | 8,812,460 | ||||||||||||||||||||
| Net interest income (FTE) | $ | 138,145 | $ | 136,096 | $ | 78,894 | ||||||||||||||||||||
| Net interest spread (FTE) | 3.73 | % | 3.95 | % | 3.92 | % | ||||||||||||||||||||
| Net interest margin (FTE) - quarter-to-date | 3.99 | % | 4.17 | % | 4.04 | % | ||||||||||||||||||||
| Net interest margin (FTE) - year-to-date | 4.08 | % | 4.17 | % | 4.04 | % | ||||||||||||||||||||
| Core net interest margin (FTE) - quarter-to-date (1) | 3.70 | % | 3.82 | % | 3.79 | % | ||||||||||||||||||||
| Core loan yield (FTE) - quarter-to-date (1) | 5.04 | % | 4.95 | % | 4.63 | % | ||||||||||||||||||||
| Core net interest margin (FTE) - year-to-date (1) | 3.76 | % | 3.82 | % | 3.79 | % | ||||||||||||||||||||
| Core loan yield (FTE) - year-to-date (1) | 4.99 | % | 4.95 | % | 4.61 | % | ||||||||||||||||||||
| (1) Calculations of core net interest margin and core loan yield and the reconciliations to GAAP are included in the schedules accompanying this release. | ||||||||||||||||||||||||||
| Page 7 | ||||||||||||||||||||||||||
| Simmons First National Corporation | SFNC | |||||||||||||||
| Consolidated - Selected Financial Data | ||||||||||||||||
| For the Quarters Ended | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Jun 30 | |||||||||||
| (Unaudited) | 2018 | 2018 | 2017 | 2017 | 2017 | |||||||||||
| ($ in thousands, except share data) | ||||||||||||||||
| QUARTER-TO-DATE | ||||||||||||||||
| Financial Highlights - GAAP | ||||||||||||||||
| Net Income | $ | 53,562 | $ | 51,312 | $ | 18,903 | $ | 28,852 | $ | 23,065 | ||||||
| Diluted earnings per share | 0.58 | 0.55 | 0.22 | 0.44 | 0.36 | |||||||||||
| Return on average assets | 1.38% | 1.38% | 0.54% | 1.25% | 1.05% | |||||||||||
| Return on average common equity | 10.05% | 9.90% | 3.88% | 9.12% | 7.65% | |||||||||||
| Return on tangible common equity | 18.70% | 18.77% | 7.53% | 14.47% | 12.13% | |||||||||||
| Net interest margin (FTE) | 3.99% | 4.17% | 4.21% | 3.91% | 4.04% | |||||||||||
| FTE adjustment | 1,308 | 1,130 | 1,925 | 1,751 | 2,082 | |||||||||||
| Amortization of intangibles | 2,785 | 2,837 | 2,839 | 1,724 | 1,553 | |||||||||||
| Amortization of intangibles, net of taxes | 2,057 | 2,096 | 1,725 | 1,048 | 944 | |||||||||||
| Average diluted shares outstanding | 92,733,140 | 92,638,765 | 87,036,044 | 64,847,592 | 64,051,560 | |||||||||||
| Cash dividends declared per common share | 0.15 | 0.15 | 0.13 | 0.13 | 0.13 | |||||||||||
| Financial Highlights - Core (non-GAAP) | ||||||||||||||||
| Core earnings (excludes non-core items) (1) | $ | 54,660 | $ | 52,618 | $ | 42,018 | $ | 27,746 | $ | 26,753 | ||||||
| Diluted core earnings per share (1) | 0.59 | 0.57 | 0.48 | 0.43 | 0.42 | |||||||||||
| Core net interest margin (FTE) (2) | 3.70% | 3.82% | 3.70% | 3.77% | 3.79% | |||||||||||
| Accretable yield on acquired loans | 10,113 | 11,294 | 15,684 | 2,890 | 4,792 | |||||||||||
| Efficiency ratio (1) | 52.70% | 53.24% | 51.36% | 55.06% | 56.04% | |||||||||||
| Core return on average assets (1) | 1.41% | 1.41% | 1.20% | 1.20% | 1.22% | |||||||||||
| Core return on average common equity (1) | 10.26% | 10.15% | 8.63% | 8.77% | 8.87% | |||||||||||
| Core return on tangible common equity (1) | 19.06% | 19.23% | 15.97% | 13.93% | 13.99% | |||||||||||
| YEAR-TO-DATE | ||||||||||||||||
| Financial Highlights - GAAP | ||||||||||||||||
| Net Income | $ | 104,874 | $ | 51,312 | $ | 92,940 | $ | 74,037 | $ | 45,185 | ||||||
| Diluted earnings per share | 1.13 | 0.55 | 1.33 | 1.16 | 0.71 | |||||||||||
| Return on average assets | 1.38% | 1.38% | 0.92% | 1.12% | 1.06% | |||||||||||
| Return on average common equity | 9.98% | 9.90% | 6.68% | 8.18% | 7.67% | |||||||||||
| Return on tangible common equity | 18.73% | 18.77% | 11.26% | 12.97% | 12.17% | |||||||||||
| Net interest margin (FTE) | 4.08% | 4.17% | 4.07% | 3.99% | 4.04% | |||||||||||
| FTE adjustment | 2,438 | 1,130 | 7,723 | 5,798 | 4,047 | |||||||||||
| Amortization of intangibles | 5,622 | 2,837 | 7,666 | 4,827 | 3,103 | |||||||||||
| Amortization of intangibles, net of taxes | 4,153 | 2,096 | 4,659 | 2,934 | 1,886 | |||||||||||
| Average diluted shares outstanding | 92,692,234 | 92,638,765 | 69,852,920 | 64,014,270 | 63,588,726 | |||||||||||
| Cash dividends declared per common share | 0.30 | 0.15 | 0.50 | 0.38 | 0.25 | |||||||||||
| Financial Highlights - Core (non-GAAP) | ||||||||||||||||
| Core earnings (excludes non-core items) (1) | $ | 107,278 | $ | 52,618 | $ | 119,049 | $ | 77,031 | $ | 49,285 | ||||||
| Diluted core earnings per share (1) | 1.16 | 0.57 | 1.70 | 1.20 | 0.78 | |||||||||||
| Core net interest margin (FTE) (2) | 3.76% | 3.82% | 3.76% | 3.79% | 3.79% | |||||||||||
| Accretable yield on acquired loans | 21,407 | 11,294 | 27,793 | 12,109 | 9,219 | |||||||||||
| Efficiency ratio (1) | 52.97% | 53.24% | 55.27% | 57.25% | 58.40% | |||||||||||
| Core return on average assets (1) | 1.41% | 1.41% | 1.18% | 1.17% | 1.15% | |||||||||||
| Core return on average common equity (1) | 10.20% | 10.15% | 8.56% | 8.51% | 8.37% | |||||||||||
| Core return on tangible common equity (1) | 19.14% | 19.23% | 14.28% | 13.48% | 13.23% | |||||||||||
| END OF PERIOD | ||||||||||||||||
| Book value per share | $ | 23.26 | $ | 22.86 | $ | 22.65 | $ | 19.51 | $ | 19.16 | ||||||
| Tangible book value per share | 13.05 | 12.62 | 12.34 | 12.82 | 12.36 | |||||||||||
| Shares outstanding | 92,281,370 | 92,242,389 | 92,029,118 | 64,424,484 | 64,425,664 | |||||||||||
| Full-time equivalent employees | 2,659 | 2,626 | 2,640 | 1,942 | 1,919 | |||||||||||
| Total number of financial centers | 199 | 200 | 200 | 156 | 161 | |||||||||||
| (1) Core earnings exclude non-core items, which is a non-GAAP measurement. Reconciliations to GAAP are included in the schedules accompanying this release. | ||||||||||||||||
| (2) Excludes accretable yield adjustment on loans, which is a non-GAAP measurement. Reconciliations to GAAP are included in the schedules accompanying this release. | ||||||||||||||||
| Page 8 | ||||||||||||||||
| Simmons First National Corporation | SFNC | |||||||||||||||
| Consolidated - Reconciliation of Core Earnings (non-GAAP) | ||||||||||||||||
| For the Quarters Ended | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Jun 30 | |||||||||||
| (Unaudited) | 2018 | 2018 | 2017 | 2017 | 2017 | |||||||||||
| ($ in thousands, except per share data) | ||||||||||||||||
| QUARTER-TO-DATE | ||||||||||||||||
| Net Income | $ | 53,562 | $ | 51,312 | $ | 18,903 | $ | 28,852 | $ | 23,065 | ||||||
| Non-core items | ||||||||||||||||
| Gain on sale of P&C insurance business | - | - | - | (3,708 | ) | - | ||||||||||
| Donation to Simmons Foundation | - | - | 5,000 | - | - | |||||||||||
| Merger-related costs | 1,465 | 1,711 | 14,044 | 752 | 6,603 | |||||||||||
| Branch right-sizing | 22 | 57 | 116 | 435 | (536 | ) | ||||||||||
| Tax effect (1) | (389 | ) | (462 | ) | (7,516 | ) | 1,415 | (2,379 | ) | |||||||
| Net non-core items (before SAB 118 adjustment) | 1,098 | 1,306 | 11,644 | (1,106 | ) | 3,688 | ||||||||||
| SAB 118 adjustment (2) | - | - | 11,471 | - | - | |||||||||||
| Core earnings (non-GAAP) | $ | 54,660 | $ | 52,618 | $ | 42,018 | $ | 27,746 | $ | 26,753 | ||||||
| Diluted earnings per share | $ | 0.58 | $ | 0.55 | $ | 0.22 | $ | 0.44 | $ | 0.36 | ||||||
| Non-core items | ||||||||||||||||
| Gain on sale of P&C insurance business | - | - | - | (0.06 | ) | - | ||||||||||
| Donation to Simmons Foundation | - | - | 0.06 | - | - | |||||||||||
| Merger-related costs | 0.02 | 0.02 | 0.17 | 0.01 | 0.11 | |||||||||||
| Branch right-sizing | - | - | - | 0.01 | (0.01 | ) | ||||||||||
| Tax effect (1) | (0.01 | ) | - | (0.10 | ) | 0.03 | (0.04 | ) | ||||||||
| Net non-core items (before SAB 118 adjustment) | 0.01 | 0.02 | 0.13 | (0.01 | ) | 0.06 | ||||||||||
| SAB 118 adjustment (2) | - | - | 0.13 | - | - | |||||||||||
| Core earnings (non-GAAP) | $ | 0.59 | $ | 0.57 | $ | 0.48 | $ | 0.43 | $ | 0.42 | ||||||
| YEAR-TO-DATE | ||||||||||||||||
| Net Income | $ | 104,874 | $ | 51,312 | $ | 92,940 | $ | 74,037 | $ | 45,185 | ||||||
| Non-core items | ||||||||||||||||
| Gain on sale of P&C insurance business | - | - | (3,708 | ) | (3,708 | ) | - | |||||||||
| Donation to Simmons Foundation | - | - | 5,000 | - | - | |||||||||||
| Merger-related costs | 3,176 | 1,711 | 21,923 | 7,879 | 7,127 | |||||||||||
| Branch right-sizing | 79 | 57 | 169 | 53 | (382 | ) | ||||||||||
| Tax effect (1) | (851 | ) | (462 | ) | (8,746 | ) | (1,230 | ) | (2,645 | ) | ||||||
| Net non-core items (before SAB 118 adjustment) | 2,404 | 1,306 | 14,638 | 2,994 | 4,100 | |||||||||||
| SAB 118 adjustment (2) | - | - | 11,471 | - | - | |||||||||||
| Core earnings (non-GAAP) | $ | 107,278 | $ | 52,618 | $ | 119,049 | $ | 77,031 | $ | 49,285 | ||||||
| Diluted earnings per share | $ | 1.13 | $ | 0.55 | $ | 1.33 | $ | 1.16 | $ | 0.71 | ||||||
| Non-core items | ||||||||||||||||
| Gain on sale of P&C insurance business | - | - | (0.04 | ) | (0.06 | ) | - | |||||||||
| Donation to Simmons Foundation | - | - | 0.07 | |||||||||||||
| Merger-related costs | 0.04 | 0.02 | 0.31 | 0.12 | 0.12 | |||||||||||
| Branch right-sizing | - | - | - | - | (0.01 | ) | ||||||||||
| Tax effect (1) | (0.01 | ) | - | (0.13 | ) | (0.02 | ) | (0.04 | ) | |||||||
| Net non-core items (before SAB 118 adjustment) | 0.03 | 0.02 | 0.21 | 0.04 | 0.07 | |||||||||||
| SAB 118 adjustment (2) | - | - | 0.16 | - | - | |||||||||||
| Core earnings (non-GAAP) | $ | 1.16 | $ | 0.57 | $ | 1.70 | $ | 1.20 | $ | 0.78 | ||||||
| (1) Effective tax rate of 26.135% for 2018 and 39.225% for prior years, adjusted for non-deductible merger-related costs and deferred tax items on P&C insurance sale. | ||||||||||||||||
| (2) Tax adjustment to revalue deferred tax assets and liabilities to account for the future impact of lower corporate tax rates resulting from the "Tax Cuts and Jobs Act", signed into law on December 22, 2017. | ||||||||||||||||
| Page 9 | ||||||||||||||||
| Simmons First National Corporation | SFNC | |||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - End of Period | ||||||||||||||||
| For the Quarters Ended | ||||||||||||||||
| (Unaudited) | Jun 30 | Mar 31 | Dec 31 | Sept 30 | Jun 30 | |||||||||||
| 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||||
| ($ in thousands, except per share data) | ||||||||||||||||
| Calculation of Tangible Common Equity and the Ratio of Tangible Common Equity to Tangible Assets | ||||||||||||||||
| Total common stockholders' equity | $ | 2,146,908 | $ | 2,109,051 | $ | 2,084,564 | $ | 1,257,199 | $ | 1,234,076 | ||||||
| Intangible assets: | ||||||||||||||||
| Goodwill | (845,687 | ) | (845,687 | ) | (842,651 | ) | (375,731 | ) | (379,437 | ) | ||||||
| Other intangible assets | (96,720 | ) | (99,504 | ) | (106,071 | ) | (55,501 | ) | (58,528 | ) | ||||||
| Total intangibles | (942,407 | ) | (945,191 | ) | (948,722 | ) | (431,232 | ) | (437,965 | ) | ||||||
| Tangible common stockholders' equity | $ | 1,204,501 | $ | 1,163,860 | $ | 1,135,842 | $ | 825,967 | $ | 796,111 | ||||||
| Total assets | $ | 16,165,533 | $ | 15,597,309 | $ | 15,055,806 | $ | 9,535,370 | $ | 9,068,308 | ||||||
| Intangible assets: | ||||||||||||||||
| Goodwill | (845,687 | ) | (845,687 | ) | (842,651 | ) | (375,731 | ) | (379,437 | ) | ||||||
| Other intangible assets | (96,720 | ) | (99,504 | ) | (106,071 | ) | (55,501 | ) | (58,528 | ) | ||||||
| Total intangibles | (942,407 | ) | (945,191 | ) | (948,722 | ) | (431,232 | ) | (437,965 | ) | ||||||
| Tangible assets | $ | 15,223,126 | $ | 14,652,118 | $ | 14,107,084 | $ | 9,104,138 | $ | 8,630,343 | ||||||
| Ratio of equity to assets | 13.28 | % | 13.52 | % | 13.85 | % | 13.18 | % | 13.61 | % | ||||||
| Ratio of tangible common equity to tangible assets | 7.91 | % | 7.94 | % | 8.05 | % | 9.07 | % | 9.22 | % | ||||||
| Calculation of Discount for credit losses and allowance on loans acquired to total loans acquired plus | ||||||||||||||||
| discount for credit losses and allowance on loans acquired | ||||||||||||||||
| Credit discount on acquired loans | $ | 68,282 | $ | 79,087 | $ | 89,275 | $ | 24,994 | $ | 28,409 | ||||||
| Allowance for loan losses on acquired loans | 2,044 | 407 | 418 | 391 | 391 | |||||||||||
| Total credit discount and ALLL on acquired loans | $ | 70,326 | $ | 79,494 | $ | 89,693 | $ | 25,385 | $ | 28,800 | ||||||
| Total loans acquired | $ | 4,302,760 | $ | 4,776,439 | $ | 5,163,769 | $ | 1,117,424 | $ | 1,253,539 | ||||||
| Discount and ALLL on acquired loans to acquired loans | 1.63 | % | 1.66 | % | 1.74 | % | 2.27 | % | 2.30 | % | ||||||
| Calculation of Total Allowance and Credit Coverage | ||||||||||||||||
| Allowance for loan losses | $ | 51,732 | $ | 47,207 | $ | 41,668 | $ | 42,717 | $ | 41,379 | ||||||
| Total credit discount and ALLL on acquired loans | 70,326 | 79,494 | 89,693 | 25,385 | 28,800 | |||||||||||
| Total allowance and credit discount | $ | 122,058 | $ | 126,701 | $ | 131,361 | $ | 68,102 | $ | 70,179 | ||||||
| Total loans | $ | 11,436,221 | $ | 11,066,822 | $ | 10,869,378 | $ | 6,328,736 | $ | 6,254,155 | ||||||
| Total allowance and credit coverage | 1.07 | % | 1.14 | % | 1.21 | % | 1.08 | % | 1.12 | % | ||||||
| Calculation of Tangible Book Value per Share | ||||||||||||||||
| Total common stockholders' equity | $ | 2,146,908 | $ | 2,109,051 | $ | 2,084,564 | $ | 1,257,199 | $ | 1,234,076 | ||||||
| Intangible assets: | ||||||||||||||||
| Goodwill | (845,687 | ) | (845,687 | ) | (842,651 | ) | (375,731 | ) | (379,437 | ) | ||||||
| Other intangible assets | (96,720 | ) | (99,504 | ) | (106,071 | ) | (55,501 | ) | (58,528 | ) | ||||||
| Total intangibles | (942,407 | ) | (945,191 | ) | (948,722 | ) | (431,232 | ) | (437,965 | ) | ||||||
| Tangible common stockholders' equity | $ | 1,204,501 | $ | 1,163,860 | $ | 1,135,842 | $ | 825,967 | $ | 796,111 | ||||||
| Shares of common stock outstanding | 92,281,370 | 92,242,389 | 92,029,118 | 64,424,484 | 64,425,664 | |||||||||||
| Book value per common share | $ | 23.26 | $ | 22.86 | $ | 22.65 | $ | 19.51 | $ | 19.16 | ||||||
| Tangible book value per common share | $ | 13.05 | $ | 12.62 | $ | 12.34 | $ | 12.82 | $ | 12.36 | ||||||
| Page 10 | ||||||||||||||||
| Simmons First National Corporation | SFNC | |||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date | ||||||||||||||||
| For the Quarters Ended | ||||||||||||||||
| (Unaudited) | Jun 30 | Mar 31 | Dec 31 | Sept 30 | Jun 30 | |||||||||||
| 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||||
| ($ in thousands) | ||||||||||||||||
| Calculation of Core Return on Average Assets | ||||||||||||||||
| Net income | $ | 53,562 | $ | 51,312 | $ | 18,903 | $ | 28,852 | $ | 23,065 | ||||||
| Net non-core items, net of taxes, adjustment | 1,098 | 1,306 | 23,115 | (1,106 | ) | 3,688 | ||||||||||
| Core earnings | $ | 54,660 | $ | 52,618 | $ | 42,018 | $ | 27,746 | $ | 26,753 | ||||||
| Average total assets | $ | 15,580,697 | $ | 15,088,210 | $ | 13,897,778 | $ | 9,175,607 | $ | 8,812,460 | ||||||
| Return on average assets | 1.38 | % | 1.38 | % | 0.54 | % | 1.25 | % | 1.05 | % | ||||||
| Core return on average assets | 1.41 | % | 1.41 | % | 1.20 | % | 1.20 | % | 1.22 | % | ||||||
| Calculation of Return on Tangible Common Equity | ||||||||||||||||
| Net income | $ | 53,562 | $ | 51,312 | $ | 18,903 | $ | 28,852 | $ | 23,065 | ||||||
| Amortization of intangibles, net of taxes | 2,057 | 2,096 | 1,725 | 1,048 | 944 | |||||||||||
| Total income available to common stockholders | $ | 55,619 | $ | 53,408 | $ | 20,628 | $ | 29,900 | $ | 24,009 | ||||||
| Net non-core items, net of taxes | 1,098 | 1,306 | 23,115 | (1,106 | ) | 3,688 | ||||||||||
| Core earnings | 54,660 | 52,618 | 42,018 | 27,746 | 26,753 | |||||||||||
| Amortization of intangibles, net of taxes | 2,057 | 2,096 | 1,725 | 1,048 | 944 | |||||||||||
| Total core income available to common stockholders | $ | 56,717 | $ | 54,714 | $ | 43,743 | $ | 28,794 | $ | 27,697 | ||||||
| Average common stockholders' equity | $ | 2,137,097 | $ | 2,103,052 | $ | 1,931,804 | $ | 1,255,694 | $ | 1,209,343 | ||||||
| Average intangible assets: | ||||||||||||||||
| Goodwill | (845,687 | ) | (844,148 | ) | (731,661 | ) | (378,387 | ) | (362,925 | ) | ||||||
| Other intangibles | (98,152 | ) | (104,718 | ) | (113,770 | ) | (57,232 | ) | (52,419 | ) | ||||||
| Total average intangibles | (943,839 | ) | (948,866 | ) | (845,431 | ) | (435,619 | ) | (415,344 | ) | ||||||
| Average tangible common stockholders' equity | $ | 1,193,258 | $ | 1,154,186 | $ | 1,086,373 | $ | 820,075 | $ | 793,999 | ||||||
| Return on average common equity | 10.05 | % | 9.90 | % | 3.88 | % | 9.12 | % | 7.65 | % | ||||||
| Return on tangible common equity | 18.70 | % | 18.77 | % | 7.53 | % | 14.47 | % | 12.13 | % | ||||||
| Core return on average common equity | 10.26 | % | 10.15 | % | 8.63 | % | 8.77 | % | 8.87 | % | ||||||
| Core return on tangible common equity | 19.06 | % | 19.23 | % | 15.97 | % | 13.93 | % | 13.99 | % | ||||||
| Calculation of Efficiency Ratio (1) | ||||||||||||||||
| Non-interest expense | $ | 98,507 | $ | 98,073 | $ | 108,490 | $ | 66,159 | $ | 71,408 | ||||||
| Non-core non-interest expense adjustment | (1,483 | ) | (1,772 | ) | (19,160 | ) | (862 | ) | (6,700 | ) | ||||||
| Other real estate and foreclosure expense adjustment | (1,382 | ) | (1,020 | ) | (865 | ) | (1,071 | ) | (517 | ) | ||||||
| Amortization of intangibles adjustment | (2,785 | ) | (2,837 | ) | (2,839 | ) | (1,724 | ) | (1,553 | ) | ||||||
| Efficiency ratio numerator | $ | 92,857 | $ | 92,444 | $ | 85,626 | $ | 62,502 | $ | 62,638 | ||||||
| Net-interest income | $ | 136,837 | $ | 134,966 | $ | 126,919 | $ | 78,819 | $ | 76,812 | ||||||
| Non-interest income | 38,048 | 37,535 | 36,629 | 36,332 | 35,744 | |||||||||||
| Non-core non-interest income adjustment | 4 | (4 | ) | - | (3,383 | ) | (632 | ) | ||||||||
| Fully tax-equivalent adjustment | 1,308 | 1,130 | 1,925 | 1,751 | 2,082 | |||||||||||
| (Gain) loss on sale of securities | 7 | (6 | ) | 1,243 | (3 | ) | (2,236 | ) | ||||||||
| Efficiency ratio denominator | $ | 176,204 | $ | 173,621 | $ | 166,716 | $ | 113,516 | $ | 111,770 | ||||||
| Efficiency ratio (1) | 52.70 | % | 53.24 | % | 51.36 | % | 55.06 | % | 56.04 | % | ||||||
| Calculation of Core Net Interest Margin | ||||||||||||||||
| Net interest income | $ | 136,837 | $ | 134,966 | $ | 126,919 | $ | 78,819 | $ | 76,812 | ||||||
| Fully tax-equivalent adjustment | 1,308 | 1,130 | 1,925 | 1,751 | 2,082 | |||||||||||
| Fully tax-equivalent net interest income | 138,145 | 136,096 | 128,844 | 80,570 | 78,894 | |||||||||||
| Total accretable yield | (10,113 | ) | (11,294 | ) | (15,684 | ) | (2,890 | ) | (4,792 | ) | ||||||
| Core net interest income | $ | 128,032 | $ | 124,802 | $ | 113,160 | $ | 77,680 | $ | 74,102 | ||||||
| Average earning assets | $ | 13,876,557 | $ | 13,251,549 | $ | 12,145,003 | $ | 8,182,292 | $ | 7,841,208 | ||||||
| Net interest margin | 3.99 | % | 4.17 | % | 4.21 | % | 3.91 | % | 4.04 | % | ||||||
| Core net interest margin | 3.70 | % | 3.82 | % | 3.70 | % | 3.77 | % | 3.79 | % | ||||||
| Calculation of Core Loan Yield | ||||||||||||||||
| Loan interest income | $ | 150,253 | $ | 143,350 | $ | 132,617 | $ | 77,457 | $ | 73,549 | ||||||
| Total accretable yield | (10,113 | ) | (11,294 | ) | (15,684 | ) | (2,890 | ) | (4,792 | ) | ||||||
| Core loan interest income | $ | 140,140 | $ | 132,056 | $ | 116,933 | $ | 74,567 | $ | 68,757 | ||||||
| Average loan balance | $ | 11,159,872 | $ | 10,819,324 | $ | 9,772,043 | $ | 6,261,507 | $ | 5,954,019 | ||||||
| Core loan yield | 5.04 | % | 4.95 | % | 4.75 | % | 4.72 | % | 4.63 | % | ||||||
| (1) Efficiency ratio is noninterest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and noninterest revenues, excluding gains and losses from securities transactions and non-core items. | ||||||||||||||||
| Page 11 | ||||||||||||||||
| Simmons First National Corporation | SFNC | |||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - Year-to-Date | ||||||||||||||||
| For the Quarters Ended | ||||||||||||||||
| (Unaudited) | Jun 30 | Mar 31 | Dec 31 | Sept 30 | Jun 30 | |||||||||||
| 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||||
| ($ in thousands) | ||||||||||||||||
| Calculation of Core Return on Average Assets | ||||||||||||||||
| Net income | $ | 104,874 | $ | 51,312 | $ | 92,940 | $ | 74,037 | $ | 45,185 | ||||||
| Net non-core items, net of taxes, adjustment | 2,404 | 1,306 | 26,109 | 2,994 | 4,100 | |||||||||||
| Core earnings | $ | 107,278 | $ | 52,618 | $ | 119,049 | $ | 77,031 | $ | 49,285 | ||||||
| Average total assets | $ | 15,334,453 | $ | 15,088,210 | $ | 10,074,951 | $ | 8,800,675 | $ | 8,613,240 | ||||||
| Return on average assets | 1.38 | % | 1.38 | % | 0.92 | % | 1.12 | % | 1.06 | % | ||||||
| Core return on average assets | 1.41 | % | 1.41 | % | 1.18 | % | 1.17 | % | 1.15 | % | ||||||
| Calculation of Return on Tangible Common Equity | ||||||||||||||||
| Net income | $ | 104,874 | $ | 51,312 | $ | 92,940 | $ | 74,037 | $ | 45,185 | ||||||
| Amortization of intangibles, net of taxes | 4,153 | 2,096 | 4,659 | 2,934 | 1,886 | |||||||||||
| Total income available to common stockholders | $ | 109,027 | $ | 53,408 | $ | 97,599 | $ | 76,971 | $ | 47,071 | ||||||
| Net non-core items, net of taxes | 2,404 | 1,306 | 26,109 | 2,994 | 4,100 | |||||||||||
| Core earnings | 107,278 | 52,618 | 119,049 | 77,031 | 49,285 | |||||||||||
| Amortization of intangibles, net of taxes | 4,153 | 2,096 | 4,659 | 2,934 | 1,886 | |||||||||||
| Total core income available to common stockholders | $ | 111,431 | $ | 54,714 | $ | 123,708 | $ | 79,965 | $ | 51,171 | ||||||
| Average common stockholders' equity | $ | 2,120,075 | $ | 2,103,052 | $ | 1,390,815 | $ | 1,210,487 | $ | 1,187,906 | ||||||
| Average intangible assets: | ||||||||||||||||
| Goodwill | (844,917 | ) | (844,148 | ) | (455,453 | ) | (363,383 | ) | (355,881 | ) | ||||||
| Other intangibles | (101,435 | ) | (104,718 | ) | (68,896 | ) | (53,941 | ) | (52,294 | ) | ||||||
| Total average intangibles | (946,352 | ) | (948,866 | ) | (524,349 | ) | (417,324 | ) | (408,175 | ) | ||||||
| Average tangible common stockholders' equity | $ | 1,173,723 | $ | 1,154,186 | $ | 866,466 | $ | 793,163 | $ | 779,731 | ||||||
| Return on average common equity | 9.98 | % | 9.90 | % | 6.68 | % | 8.18 | % | 7.67 | % | ||||||
| Return on tangible common equity | 18.73 | % | 18.77 | % | 11.26 | % | 12.97 | % | 12.17 | % | ||||||
| Core return on average common equity | 10.20 | % | 10.15 | % | 8.56 | % | 8.51 | % | 8.37 | % | ||||||
| Core return on tangible common equity | 19.14 | % | 19.23 | % | 14.28 | % | 13.48 | % | 13.23 | % | ||||||
| Calculation of Efficiency Ratio (1) | ||||||||||||||||
| Non-interest expense | $ | 196,580 | $ | 98,073 | $ | 312,379 | $ | 203,889 | $ | 137,730 | ||||||
| Non-core non-interest expense adjustment | (3,255 | ) | (1,772 | ) | (27,357 | ) | (8,197 | ) | (7,335 | ) | ||||||
| Other real estate and foreclosure expense adjustment | (2,402 | ) | (1,020 | ) | (3,042 | ) | (2,177 | ) | (1,067 | ) | ||||||
| Amortization of intangibles adjustment | (5,622 | ) | (2,837 | ) | (7,666 | ) | (4,827 | ) | (3,103 | ) | ||||||
| Efficiency ratio numerator | $ | 185,301 | $ | 92,444 | $ | 274,314 | $ | 188,688 | $ | 126,225 | ||||||
| Net-interest income | $ | 271,803 | $ | 134,966 | $ | 354,930 | $ | 228,011 | $ | 149,192 | ||||||
| Non-interest income | 75,583 | 37,535 | 138,765 | 102,136 | 65,804 | |||||||||||
| Non-core non-interest income adjustment | - | (4 | ) | (3,972 | ) | (3,972 | ) | (589 | ) | |||||||
| Fully tax-equivalent adjustment | 2,438 | 1,130 | 7,723 | 5,798 | 4,047 | |||||||||||
| (Gain) loss on sale of securities | 1 | (6 | ) | (1,059 | ) | (2,302 | ) | (2,299 | ) | |||||||
| Efficiency ratio denominator | $ | 349,825 | $ | 173,621 | $ | 496,387 | $ | 329,671 | $ | 216,155 | ||||||
| Efficiency ratio (1) | 52.97 | % | 53.24 | % | 55.27 | % | 57.25 | % | 58.40 | % | ||||||
| Calculation of Core Net Interest Margin | ||||||||||||||||
| Net interest income | $ | 271,803 | $ | 134,966 | $ | 354,930 | $ | 228,011 | $ | 149,192 | ||||||
| Fully tax-equivalent adjustment | 2,438 | 1,130 | 7,723 | 5,798 | 4,047 | |||||||||||
| Fully tax-equivalent net interest income | 274,241 | 136,096 | 362,653 | 233,809 | 153,239 | |||||||||||
| Total accretable yield | (21,407 | ) | (11,294 | ) | (27,793 | ) | (12,109 | ) | (9,219 | ) | ||||||
| Core net interest income | $ | 252,834 | $ | 124,802 | $ | 334,860 | $ | 221,700 | $ | 144,020 | ||||||
| Average earning assets | $ | 13,564,056 | $ | 13,251,549 | $ | 8,908,418 | $ | 7,829,548 | $ | 7,653,177 | ||||||
| Net interest margin | 4.08 | % | 4.17 | % | 4.07 | % | 3.99 | % | 4.04 | % | ||||||
| Core net interest margin | 3.76 | % | 3.82 | % | 3.76 | % | 3.79 | % | 3.79 | % | ||||||
| Calculation of Core Loan Yield | ||||||||||||||||
| Loan interest income | $ | 293,603 | $ | 143,350 | $ | 352,351 | $ | 219,734 | $ | 142,277 | ||||||
| Total accretable yield | (21,407 | ) | (11,294 | ) | (27,793 | ) | (12,109 | ) | (9,219 | ) | ||||||
| Core loan interest income | $ | 272,196 | $ | 132,056 | $ | 324,558 | $ | 207,625 | $ | 133,058 | ||||||
| Average loan balance | $ | 10,989,600 | $ | 10,819,324 | $ | 6,918,293 | $ | 5,967,036 | $ | 5,819,803 | ||||||
| Core loan yield | 4.99 | % | 4.95 | % | 4.69 | % | 4.65 | % | 4.61 | % | ||||||
| (1) Efficiency ratio is noninterest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and noninterest revenues, excluding gains and losses from securities transactions and non-core items. | ||||||||||||||||
| Page 12 | ||||||||||||||||