Simmons Reports Record Earnings for Third Quarter 2018


PINE BLUFF, Ark., Oct. 22, 2018 (GLOBE NEWSWIRE) -- Simmons First National Corporation (NASDAQ: SFNC) today announced record net income of $55.2 million for the quarter ended September 30, 2018, compared to $28.9 million for the same period in 2017, an increase of $26.3 million, or 91.3%. Diluted earnings per share were $0.59, an increase of $0.15, or 34.1%, from the same period in 2017.  Included in third quarter 2018 results were $1.3 million in net after-tax merger-related and branch right-sizing costs. Excluding the impact of these items, core earnings were $56.5 million for the quarter ended September 30, 2018, compared to $27.7 million for the quarter ended September 30, 2017, an increase of $28.8 million, or 103.7%. Core diluted earnings per share were $0.61, an increase of $0.18, or 41.9%, from the same period in 2017.

Year-to-date net income for the first nine months of 2018 was $160.1 million, or $1.72 diluted earnings per share, compared to $74.0 million, or $1.16 diluted earnings per share, for the same period in 2017. Excluding $3.7 million in net after-tax merger-related and branch right sizing costs, year-to-date core earnings for 2018 were $163.8 million, an increase of $86.8 million compared to the same period last year.

“We are proud to again report record earnings for this quarter building off the strong results in the first half of the year,” said George A. Makris, Jr., chairman and CEO.

Makris continued, “We continue to experience excellent organic growth in all of our markets.  We are also very pleased that we have been able to balance year-to-date loan yields with deposit costs in this rising-rate environment.”

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: 3rd Qtr 20182nd Qtr 20184th Qtr 20173rd Qtr 2017
      
Net income $55.2 million$53.6 million$18.9 million$28.9 million
Diluted earnings per share $0.59$0.58$0.43$0.44
Return on avg assets 1.37%1.38%0.54%1.25%
Return on avg common equity 10.06%10.05%3.88%9.12%
Return on tangible common equity 18.38%18.70%7.53%14.47%
     
Core earnings(1) $56.5 million$54.7 million$42.0 million$27.7 million
Diluted core earnings per share(1) $0.61$0.59$0.48$0.43
Core return on avg assets(1) 1.40%1.41%1.20%1.20%
Core return on avg common equity(1) 10.30%10.26%8.63%8.77%
Core return on tangible common equity(1) 18.80%19.06%15.97%13.93%
     
Efficiency ratio 53.47%52.70%51.36%55.06%
  1. Core earnings excludes non-core items, and is a non-GAAP measurement.


Loans

  3rd Qtr 20182nd Qtr 20184th Qtr 20173rd Qtr 2017
      
Total loans $11.9 billion$11.4 billion$10.8 billion$6.3 billion
Legacy loans (all loans excluding loans acquired) $8.1 billion$7.1 billion$5.7 billion$5.2 billion
Loans acquired $3.8 billion$4.3 billion$5.1 billion$1.1 billion

Total loans, including those acquired, were $11.9 billion at September 30, 2018. On a linked-quarter basis (September 30, 2018 compared to June 30, 2018), total loans increased $492.3 million, or 4.3%.  Total loans increased $1.1 billion, or 10.0%, since December 31, 2017.   

Deposits

  3rd Qtr 20182nd Qtr 20184th Qtr 20173rd Qtr 2017
      
Total deposits $12.1 billion$12.0 billion$11.1 billion$7.3 billion
Non-time deposits $9.6 billion$9.6 billion$9.2 billion$6.0 billion
Time deposits $2.5 billion$2.4 billion$1.9 billion$1.3 billion

Total deposits were $12.1 billion at September 30, 2018, an increase of $135 million, or 1.1%, compared to the previous quarter.  Total deposits increased $1.0 billion, or 9.0%, since December 31, 2017.

Net Interest Income

 3rd Qtr
2018
2nd Qtr
2018
1st Qtr
2018
4th Qtr
2017
3rd Qtr
2017
Loan yield (1)5.54%5.40%5.38%5.39%4.91%
Core loan yield (1) (2)5.19%5.04%4.95%4.75%4.72%
Security yield (1)2.74%2.75%2.67%2.62%2.64%
Cost of interest bearing deposits1.05%0.84%0.74%0.63%0.43%
Cost of borrowed funds2.48%2.38%1.70%1.78%1.52%
Net interest margin (1)3.98%3.99%4.17%4.21%3.91%
Core net interest margin (1) (2)3.71%3.70%3.82%3.70%3.77%
  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 third quarter of 2018 was $143.0 million, an increase of $64.1 million, or 81.4%, from the same period of 2017. Included in interest income was the yield accretion recognized on loans acquired of $10.0 million and $2.9 million for the third quarters of 2018 and 2017, respectively. Yield accretion was $5.2 million higher than projected during the quarter due to accelerated cash flows of acquired loans. Based on its cash flow projections, the Company expects accretion for the fourth quarter of approximately $4.2 million.

Net interest margin was 3.98% for the quarter ended September 30, 2018, a 1 basis point decrease from the second quarter. The Company’s core net interest margin, excluding the accretion, was 3.71% for the third quarter of 2018, a 1 basis point increase from June 30, 2018.  Cost of interest bearing deposits was 1.05% for the third quarter of 2018, a 62 basis point increase from September 30, 2017 and a 21 basis point increase from June 30, 2018.

Since December 2017, the Federal Reserve Board increased the Fed Funds target rate by 75 basis points. The Company’s deposit beta was 56% and the core loan beta was 59%.   During this same period, loan yield has increased 15 basis points and core loan yield has increased 44 basis points while cost of interest bearing deposits has risen 42 basis points.  The cost of borrowed funds increased 70 basis points. The subordinated debt issuance at the end of the first quarter had a 5 basis point impact on the Company’s third quarter net interest margin. The timing of existing subordinated debt prepayment had an additional 1 basis point impact.

Non-Interest Income

Non-interest income for the third quarter 2018 was $33.7 million, a decrease of $4.3 million compared to the previous quarter. The decrease was primarily due to decreases in debit card fees and mortgage lending income.  The interchange rate cap as established by the Durbin amendment became effective for the Company July 1, 2018, resulting in a $3.3 million reduction in debit card fees for the third quarter when compared to the second quarter.

Mortgage lending income was $1.4 million less than the second quarter mainly due to a continued slow-down in transactions driven by the rising rate environment.  SBA income was flat from prior quarter due to management remaining selective in the Company’s loan sales as premium rates have lowered in recent months to the 6 to 7% range compared to 10% during the first quarter of the year.

Non-Interest Expense

Non-interest expense for the third quarter of 2018 was $100.3 million, an increase of $1.7 million compared to the previous quarter. Included in this quarter were $1.8 million of pre-tax merger-related expenses and branch rightsizing expenses. Excluding these expenses, core non-interest expense was $98.5 million, an increase of $1.5 million compared to the previous quarter.

Approximately $1.2 million in computer and software items were expensed during the quarter as part of the Company’s Next Generation Banking platform initiative.  An incremental $1.1 million was spent during the quarter, when compared to the previous quarter, primarily for marketing campaigns directed towards increasing deposits. Included in the quarter was $1.1 million of one-time 401k profit-sharing expense. These increases were partially offset by decreases in other categories related to cost savings from merger integrations.  The efficiency ratio for the third quarter 2018 was 53.47%.

The Company closed eight branch locations and two mobile branch locations during September, with expected annual cost savings of approximately $2.2 million related to these locations. Management continuously evaluates the Company’s branch network to determine the locations that are meeting the greatest needs of its customers.

Asset Quality

  3rd Qtr 20182nd Qtr 20184th Qtr 20173rd Qtr 2017
      
Allowance for loan losses to total loans0.68%0.73%0.73%0.82%
Allowance for loan losses to non-performing loans 136%115%90%78%
Non-performing loans to total loans 0.50%0.63%0.81%1.05%
Net charge-off ratio (annualized) 0.36%0.17%0.53%0.32%
   • Net charge-off ratio excluding loan sale0.12%   

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 September 30, 2018, the allowance for loan losses for legacy loans was $55.4 million. The allowance for loan losses for loans acquired was $1.3 million and the acquired loan discount credit mark was $54.0 million. The allowances for loan losses and credit marks provide a total of $110.7 million of coverage, which equates to a total coverage ratio of 0.9% of gross loans. The ratio of credit mark and related allowance to loans acquired was 1.5%.

Provision for loan losses for the third quarter of 2018 was $10.3 million, an increase of $1.3 million from the second quarter and $4.9 million from the same period last year. The increases are primarily due to strong legacy loan growth as well as increased migration from loans acquired to legacy loans resulting from new credit decisions being made on those loans during the third quarter.  An incremental $3.0 million was included in the provision during the quarter related to the accelerated cash flows on migrating acquired loans.

During September, the Company sold approximately $32 million of substandard rated loans that consisted of both legacy and acquired loans. The loans had adequate reserves, thus no provision expense was required.  However, the sale increased net charge-offs by approximately $4.6 million.

Foreclosed Assets and Other Real Estate Owned

At September 30, 2018, foreclosed assets and other real estate owned were $22.7 million, a decrease of $8.8 million, or 28.0%, compared to the same period in 2017 and a decrease of $7.8 million, or 25.7% from June 30, 2018. These decreases were partially offset by the addition of $2.8 million related to the closure of bank branches. The composition of these assets is divided into three types:      

  3rd Qtr 20182nd Qtr 20184th Qtr 20173rd Qtr 2017
      
Closed bank branches, branch sites & associate relocation$9.6 million$7.2 million$9.8 million$12.8 million
Foreclosed assets - acquired $8.0 million$13.2 million$16.0 million$11.1 million
Foreclosed assets - legacy $5.1 million$10.1 million$6.3 million$7.6 million

 

Capital

  3rd Qtr 20182nd Qtr 20184th Qtr 20173rd Qtr 2017
      
Stockholders’ equity to total assets 13.4%13.3%13.9%13.2%
Tangible common equity to tangible assets 8.1%7.9%8.1%9.1%
Regulatory tier 1 leverage ratio 8.7%8.6%9.2%10.6%
Regulatory total risk-based capital ratio 13.1%13.7%11.4%13.5%

At September 30, 2018, common stockholders' equity was $2.2 billion, book value per share was $23.66 and tangible book value per share was $13.48.   

Simmons First National Corporation

Simmons First National Corporation is a financial holding company, headquartered in Pine Bluff, Arkansas, with total assets of $16.3 billion as of September 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 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, October 23, 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 7878976. 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  Sep 30  Jun 30 Mar 31 Dec 31  Sep 30 
 (Unaudited)   2018    2018   2018   2017    2017  
($ in thousands)               
 ASSETS                
 Cash and non-interest bearing balances due from banks $  125,231 $  162,567 $  170,811 $  205,025 $  108,675 
 Interest bearing balances due from banks and federal funds sold    388,573    781,279    688,853    393,017    323,615 
  Cash and cash equivalents    513,804    943,846    859,664    598,042    432,290 
 Interest bearing balances due from banks - time    3,954    2,974    3,069    3,314    4,059 
 Investment securities - held-to-maturity    323,306    333,503    352,756    368,058    406,033 
 Investment securities - available-for-sale    1,997,814    1,938,644    1,830,113    1,589,517    1,317,420 
 Mortgage loans held for sale    48,195    39,812    17,708    24,038    12,614 
 Assets held in trading accounts    -     -     -     -     49 
 Other assets held for sale    5,136    14,898    24,784    165,780    182,378 
 Loans:      
 Legacy loans    8,123,274    7,133,461    6,290,383    5,705,609    5,211,312 
 Allowance for loan losses    (55,358)   (51,732)   (47,207)   (41,668)   (42,717)
 Loans acquired, net of discount and allowance    3,734,921    4,232,434    4,696,945    5,074,076    1,092,039 
 Net loans    11,802,837    11,314,163    10,940,121    10,738,017    6,260,634 
 Premises and equipment    287,246    288,777    289,355    287,249    224,376 
 Foreclosed assets and other real estate owned    22,664    30,503    29,140    32,118    31,477 
 Interest receivable    51,509    44,266    42,129    43,528    30,749 
 Bank owned life insurance    192,680    191,575    186,473    185,984    148,984 
 Goodwill    845,687    845,687    845,687    842,651    375,731 
 Other intangible assets    93,975    96,720    99,504    106,071    55,501 
 Other assets    92,457    80,165    76,806    71,439    53,075 
     Total assets $  16,281,264 $  16,165,533 $  15,597,309 $  15,055,806 $  9,535,370 
                
 LIABILITIES AND STOCKHOLDERS' EQUITY      
 Deposits:      
 Non-interest bearing transaction accounts $  2,778,670 $  2,683,489 $  2,734,287 $  2,665,249 $  1,669,860 
 Interest bearing transaction accounts and savings deposits    6,776,330    6,916,520    6,720,754    6,494,896    4,344,779 
 Time deposits    2,533,506    2,353,439    2,201,874    1,932,730    1,310,951 
          Total deposits    12,088,506    11,953,448    11,656,915    11,092,875    7,325,590 
 Federal funds purchased and securities sold      
 under agreements to repurchase    109,213    99,801    120,909    122,444    121,687 
 Other borrowings    1,420,917    1,451,811    1,140,986    1,380,024    522,541 
 Subordinated notes and debentures    372,934    413,337    468,465    140,565    67,418 
 Other liabilities held for sale    424    1,840    2,781    157,366    176,964 
 Accrued interest and other liabilities    105,951    98,388    98,202    77,968    63,971 
 Total liabilities    14,097,945    14,018,625    13,488,258    12,971,242    8,278,171 
                
 Stockholders' equity:      
 Common stock    923    923    922    920    644 
 Surplus    1,597,261    1,594,342    1,590,086    1,586,034    763,121 
 Undivided profits    633,175    591,826    552,105    514,874    504,085 
 Accumulated other comprehensive loss:      
 Unrealized depreciation on AFS securities    (48,040)   (40,183)   (34,062)   (17,264)   (10,651)
 Total stockholders' equity    2,183,319    2,146,908    2,109,051    2,084,564    1,257,199 
      Total liabilities and stockholders' equity $  16,281,264 $  16,165,533 $  15,597,309 $  15,055,806 $  9,535,370 
                
      

 

 Simmons First National Corporation      SFNC 
 Consolidated Statements of Income - Quarter-to-Date      
 For the Quarters Ended Sep 30Jun 30Mar 31Dec 31Sep 30
 (Unaudited)  2018  2018   2018  2017   2017 
($ in thousands, except per share data)     
 INTEREST INCOME      
  Loans $  162,438$  150,253 $  143,350$  132,617 $  77,457
  Interest bearing balances due from banks and federal funds sold    1,405   1,414    1,009   947    650
  Investment securities    14,640   14,296    12,622   11,456    9,218
  Mortgage loans held for sale    501   305    158   175    159
      TOTAL INTEREST INCOME    178,984   166,268    157,139   145,195    87,484
 INTEREST EXPENSE      
  Time deposits    8,017   6,175    4,842   3,944    2,110
  Other deposits    16,373   12,286    10,755   8,762    3,920
  Federal funds purchased and securities      
   sold under agreements to repurchase    104   88    110   97    83
  Other borrowings    6,240   5,141    5,139   3,993    1,875
  Subordinated notes and debentures    5,282   5,741    1,327   1,480    677
     TOTAL INTEREST EXPENSE    36,016   29,431    22,173   18,276    8,665
 NET INTEREST INCOME    142,968   136,837    134,966   126,919    78,819
  Provision for loan losses    10,345   9,033    9,150   9,601    5,462
 NET INTEREST INCOME AFTER PROVISION      
  FOR LOAN LOSSES    132,623   127,804    125,816   117,318    73,357
 NON-INTEREST INCOME      
  Trust income    6,277   5,622    5,249   6,020    4,225
  Service charges on deposit accounts    10,837   10,063    10,345   10,587    8,907
  Other service charges and fees    1,201   2,017    2,750   2,774    2,433
  Mortgage and SBA lending income    1,825   3,130    4,445   3,713    3,219
  Investment banking income    664   814    834   786    680
  Debit and credit card fees    6,820   10,105    8,796   8,801    8,864
  Bank owned life insurance income    1,105   1,102    1,103   1,101    725
  Gain (loss) on sale of securities, net    54   (7)   6   (1,243)   3
  Other income    4,942   5,202    4,007   4,090    7,276
     TOTAL NON-INTEREST INCOME    33,725   38,048    37,535   36,629    36,332
 NON-INTEREST EXPENSE      
  Salaries and employee benefits    55,515   55,678    56,357   49,288    35,285
  Occupancy expense, net    7,713   7,921    6,960   6,700    4,928
  Furniture and equipment expense    3,761   4,020    4,403   5,533    4,840
  Other real estate and foreclosure expense    538   1,382    1,020   865    1,071
  Deposit insurance    2,248   1,856    2,128   1,216    1,020
  Merger-related costs    804   1,465    1,711   14,044    752
  Other operating expenses    29,674   26,185    25,494   30,844    18,263
     TOTAL NON-INTEREST EXPENSE    100,253   98,507    98,073   108,490    66,159
 NET INCOME BEFORE INCOME TAXES    66,095   67,345    65,278   45,457    43,530
  Provision for income taxes    10,902   13,783    13,966   26,554    14,678
 NET INCOME $  55,193$  53,562 $  51,312$  18,903 $  28,852
 BASIC EARNINGS PER SHARE $  0.60$  0.58 $  0.56$  0.22 $  0.45
 DILUTED EARNINGS PER SHARE $  0.59$  0.58 $  0.55$  0.22 $  0.44
      
      

 

 Simmons First National Corporation     SFNC 
 Consolidated Risk-Based Capital      
 For the Quarters Ended  Sep 30  Jun 30  Mar 31  Dec 31  Sep 30 
 (Unaudited)   2018    2018    2018    2017    2017  
($ in thousands)               
Tier 1 capital     
  Stockholders' equity$  2,183,319 $  2,146,908 $  2,109,051 $  2,084,564 $  1,257,199 
  Trust preferred securities, net allowable   -     -     -     -     67,418 
  Disallowed intangible assets, net of deferred tax   (914,788)   (917,050)   (918,161)   (902,371)   (401,419)
  Unrealized loss on AFS securities   48,040    40,183    34,062    17,264    10,651 
     Total Tier 1 capital   1,316,571    1,270,041    1,224,952    1,199,457    933,849 
                
Tier 2 capital     
  Qualifying unrealized gain on AFS equity securities   1    1    8    1    1 
  Trust preferred securities and subordinated debt   372,934    413,337    468,466    140,565    -  
  Qualifying allowance for loan losses and     
  reserve for unfunded commitments   63,618    60,691    54,436    48,947    46,709 
     Total Tier 2 capital   436,553    474,029    522,910    189,513    46,710 
      Total risk-based capital$  1,753,124 $  1,744,070 $  1,747,862 $  1,388,970 $  980,559 
                
Common equity     
  Tier 1 capital$  1,316,571 $  1,270,041 $  1,224,952 $  1,199,457 $  933,849 
  Less: Trust preferred securities   -     -     -     -     (67,418)
      Total common equity$  1,316,571 $  1,270,041 $  1,224,952 $  1,199,457 $  866,431 
                
Risk weighted assets$  13,402,910 $  12,713,093 $  12,417,233 $  12,234,160 $  7,239,923 
                
Adjusted average assets for leverage ratio$  15,179,889 $  14,714,205 $  14,179,390 $  13,016,478 $  8,789,175 
                
Ratios at end of quarter     
  Equity to assets 13.41% 13.28% 13.52% 13.85% 13.18%
  Tangible common equity to tangible assets (1) 8.11% 7.91% 7.94% 8.05% 9.07%
  Common equity Tier 1 ratio (CET1) 9.82% 9.99% 9.86% 9.80% 11.97%
  Tier 1 leverage ratio 8.67% 8.63% 8.64% 9.21% 10.62%
  Tier 1 risk-based capital ratio 9.82% 9.99% 9.86% 9.80% 12.90%
  Total risk-based capital ratio 13.08% 13.72% 14.08% 11.35% 13.54%
      
(1) Calculations of tangible common equity to tangible assets and the reconciliations to GAAP are included in the
schedules accompanying this release.     
      

 

 Simmons First National Corporation     SFNC 
 Consolidated Loans and Investments      
 For the Quarters Ended  Sep 30  Jun 30  Mar 31  Dec 31  Sep 30 
 (Unaudited)   2018   2018   2018   2017   2017 
($ in thousands)     
Legacy Loan Portfolio - End of Period (1)     
 Consumer      
    Credit cards $  182,137$  180,352$  176,602$  185,422$  176,316
    Other consumer    259,581   277,330   284,285   280,094   317,946
 Total consumer    441,718   457,682   460,887   465,516   494,262
 Real Estate      
    Construction    1,229,888   967,720   786,077   614,155   515,274
    Single-family residential    1,401,991   1,314,787   1,193,464   1,094,633   1,048,403
    Other commercial    3,077,188   2,816,420   2,611,358   2,530,824   2,231,223
 Total real estate    5,709,067   5,098,927   4,590,899   4,239,612   3,794,900
 Commercial      
    Commercial    1,608,342   1,237,910   971,704   825,217   688,960
    Agricultural    218,778   187,006   128,247   148,302   207,849
 Total commercial    1,827,120   1,424,916   1,099,951   973,519   896,809
 Other    145,369   151,936   138,646   26,962   25,341
        Total Loans $  8,123,274$  7,133,461$  6,290,383$  5,705,609$  5,211,312
      
 (1) Excludes all acquired loans.      
      
Investment Securities - End of Period     
 Held-to-Maturity      
    U.S. Government agencies $  34,983$  36,976$  46,961$  46,945$  66,928
    Mortgage-backed securities    13,933   14,645   15,404   16,132   16,972
    State and political subdivisions    272,396   279,787   286,901   301,491   320,116
    Other securities    1,994   2,095   3,490   3,490   2,017
       Total held-to-maturity    323,306   333,503   352,756   368,058   406,033
 Available-for-Sale      
    U.S. Government agencies $  141,460$  145,767$  149,804$  139,724$  208,220
    Mortgage-backed securities    1,419,626   1,395,231   1,356,179   1,187,317   959,698
    State and political subdivisions    282,439   245,335   185,888   143,165   84,822
    FHLB stock    72,579   72,042   58,177   58,914   24,415
    Other securities    81,710   80,269   80,065   60,397   40,265
        Total available-for-sale    1,997,814   1,938,644   1,830,113   1,589,517   1,317,420
        Total investment securities $  2,321,120$  2,272,147$  2,182,869$  1,957,575$  1,723,453
        Fair value - HTM investment securities $  322,838$  334,857$  354,649$  373,298$  412,140
      
Investment Securities - QTD Average     
   Taxable securities $  1,775,193$  1,750,172$  1,618,270$  1,569,173$  1,229,172
   Tax exempt securities    539,135   514,838   460,675   446,040   409,062
        Total investment securities - QTD average $  2,314,328$  2,265,010$  2,078,945$  2,015,213$  1,638,234
      
      

 

 Simmons First National Corporation      SFNC 
 Consolidated Loans and Credit Coverage      
 For the Quarters Ended  Sep 30  Jun 30  Mar 31  Dec 31  Sep 30 
 (Unaudited)   2018    2018    2018    2017    2017  
 ($ in thousands)                
LOANS     
Legacy loans$  8,123,274 $  7,133,461 $  6,290,383 $  5,705,609 $  5,211,312 
Allowance for loan losses (legacy loans)   (55,358)   (51,732)   (47,207)   (41,668)   (42,717)
Legacy loans (net of allowance)   8,067,916    7,081,729    6,243,176    5,663,941    5,168,595 
Loans acquired   3,790,234    4,302,760    4,776,439    5,163,769    1,117,424 
Credit discount   (53,968)   (68,282)   (79,087)   (89,275)   (24,994)
Allowance for loan losses (loans acquired)   (1,345)   (2,044)   (407)   (418)   (391)
Loans acquired (net of discount and allowance)   3,734,921    4,232,434    4,696,945    5,074,076    1,092,039 
   Net loans$  11,802,837 $  11,314,163 $  10,940,121 $  10,738,017 $  6,260,634 
                
      
Loan Coverage Ratios      
Allowance for loan losses to legacy loans 0.68% 0.73% 0.75% 0.73% 0.82%
      
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) 1.46% 1.63% 1.66% 1.74% 2.27%
      
  Total allowance and credit coverage (non-GAAP) (1) 0.93% 1.07% 1.14% 1.21% 1.08%
      
(1) Calculations of the non-GAAP loan coverage ratios and the reconciliations to GAAP are included in the schedules accompanying
this release.     
      

 

 Simmons First National Corporation     SFNC 
 Consolidated Allowance and Asset Quality      
 For the Quarters Ended  Sep 30  Jun 30  Mar 31  Dec 31  Sep 30 
 (Unaudited)   2018    2018    2018    2017    2017  
($ in thousands)               
Allowance for Loan Losses (Legacy Loans)     
 Balance, beginning of quarter $  51,732 $  47,207 $  41,668 $  42,717 $  41,379 
 Loans charged off                
  Credit cards    919    1,012    999    943    1,017 
  Other consumer    1,321    1,366    1,056    781    819 
  Real estate    4,952    161    455    4,725    896 
  Commercial    592    790    1,761    4,754    2,442 
     Total loans charged off    7,784    3,329    4,271    11,203    5,174 
                
 Recoveries of loans previously charged off      
  Credit cards    229    286    263    233    275 
  Other consumer    176    133    94    468    445 
  Real estate    210    112    302    233    309 
  Commercial    450    59    69    20    21 
     Total recoveries    1,065    590    728    954    1,050 
  Net loans charged off    6,719    2,739    3,543    10,249    4,124 
 Provision for loan losses    10,345    7,264    9,082    9,200    5,462 
 Balance, end of quarter $  55,358 $  51,732 $  47,207 $  41,668 $  42,717 
                
Non-performing assets (1) (2)     
 Non-performing loans      
  Nonaccrual loans $  40,505 $  44,548 $  47,395 $  45,642 $  54,439 
  Loans past due 90 days or more    281    303    336    520    232 
     Total non-performing loans    40,786    44,851    47,731    46,162    54,671 
 Other non-performing assets                
  Foreclosed assets and other real estate owned (2)   22,664    30,503    29,140    32,118    31,477 
   Other non-performing assets    524    573    794    675    639 
     Total other non-performing assets    23,188    31,076    29,934    32,793    32,116 
        Total non-performing assets $  63,974 $  75,927 $  77,665 $  78,955 $  86,787 
 Performing TDRs (troubled debt restructurings) $  8,413 $  6,367 $  6,459 $  7,107 $  9,212 
      
Ratios (1) (2)     
 Allowance for loan losses to total loans  0.68% 0.73% 0.75% 0.73% 0.82%
 Allowance for loan losses to non-performing loans  136% 115% 99% 90% 78%
 Non-performing loans to total loans  0.50% 0.63% 0.76% 0.81% 1.05%
 Non-performing assets (including performing TDRs)      
  to total assets  0.44% 0.51% 0.54% 0.57% 1.01%
 Non-performing assets to total assets  0.39% 0.47% 0.50% 0.52% 0.91%
 Annualized net charge offs to total loans  0.36% 0.17% 0.24% 0.53% 0.32%
 Annualized net credit card charge offs to      
  total credit card loans  1.47% 1.60% 1.63% 1.54% 1.65%
      
 (1) Excludes all acquired loans, except for their inclusion in total assets.    
 (2) Includes acquired foreclosed assets and acquired other real estate owned.    
    

 

 Simmons First National Corporation           SFNC 
 Consolidated - Average Balance Sheet and Net Interest Income Analysis        
 For the Quarters Ended            
 (Unaudited)            
  Three Months Ended
Sep 2018 
  Three Months Ended
Jun 2018 
  Three Months Ended
Sep 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$  373,528$  1,4051.49% $  422,987$  1,4141.34% $  269,111$  6500.96%
  Investment securities - taxable   1,775,193   10,8922.43%    1,750,172   10,7642.47%    1,229,172   6,5742.12%
  Investment securities - non-taxable (FTE)   539,135   5,0643.73%    514,838   4,7713.72%    409,062   4,3414.21%
  Mortgage loans held for sale   43,554   5014.56%    28,688   3054.26%    13,388   1594.71%
  Assets held in trading accounts   -    - 0.00%    -    - 0.00%    52   - 0.00%
  Loans, including acquired loans   11,641,843   162,5155.54%    11,159,872   150,3225.40%    6,261,507   77,5114.91%
     Total interest earning assets (FTE)   14,373,253   180,3774.98%    13,876,557   167,5764.84%    8,182,292   89,2354.33%
  Non-earning assets   1,667,631      1,704,140      993,315  
    Total assets$  16,040,884   $  15,580,697   $  9,175,607  
            
LIABILITIES AND STOCKHOLDERS' EQUITY          
Interest bearing liabilities:           
  Interest bearing transaction and           
  savings accounts$  6,840,403$  16,3730.95% $  6,570,471$  12,2860.75% $  4,227,567$  3,9200.37%
  Time deposits   2,379,142   8,0171.34%    2,233,673   6,1751.11%    1,330,889   2,1100.63%
     Total interest bearing deposits   9,219,545   24,3901.05%    8,804,144   18,4610.84%    5,558,456   6,0300.43%
  Federal funds purchased and securities           
  sold under agreement to repurchase   107,770   1040.38%    107,205   880.33%    115,583   830.28%
  Other borrowings   1,375,052   6,2401.80%    1,273,135   5,1411.62%    502,972   1,8751.48%
  Subordinated notes and debentures   379,168   5,2825.53%    466,612   5,7414.93%    67,367   6773.99%
     Total interest bearing liabilities   11,081,535   36,0161.29%    10,651,096   29,4311.11%    6,244,378   8,6650.55%
Non-interest bearing liabilities:           
  Non-interest bearing deposits   2,679,469      2,705,677      1,613,248  
  Other liabilities   103,315      86,827      62,287  
     Total liabilities   13,864,319      13,443,600      7,919,913  
Stockholders' equity   2,176,565      2,137,097      1,255,694  
     Total liabilities and stockholders' equity$  16,040,884   $  15,580,697   $  9,175,607  
Net interest income (FTE) $  144,361   $  138,145   $  80,570 
Net interest spread (FTE)  3.69%   3.73%   3.78%
Net interest margin (FTE) - quarter-to-date  3.98%   3.99%   3.91%
            
Net interest margin (FTE) - year-to-date  4.04%   4.08%   3.99%
            
Core net interest margin (FTE) - quarter-to-date (1)  3.71%   3.70%   3.77%
Core loan yield (FTE) - quarter-to-date (1)  5.19%   5.04%   4.72%
            
Core net interest margin (FTE) - year-to-date (1)  3.74%   3.76%   3.79%
Core loan yield (FTE) - year-to-date (1)  5.06%   4.99%   4.65%
            
(1) Calculations of core net interest margin and core loan yield and the reconciliations to GAAP are included in the schedules accompanying this release. 

 

 Simmons First National Corporation     SFNC 
 Consolidated - Selected Financial Data      
 For the Quarters Ended  Sep 30  Jun 30  Mar 31  Dec 31  Sep 30 
 (Unaudited)   2018    2018    2018    2017    2017  
($ in thousands, except share data)               
QUARTER-TO-DATE     
Financial Highlights - GAAP     
Net Income$  55,193 $  53,562 $  51,312 $  18,903 $  28,852 
Diluted earnings per share   0.59    0.58    0.55    0.22    0.44 
Return on average assets 1.37% 1.38% 1.38% 0.54% 1.25%
Return on average common equity 10.06% 10.05% 9.90% 3.88% 9.12%
Return on tangible common equity 18.38% 18.70% 18.77% 7.53% 14.47%
Net interest margin (FTE) 3.98% 3.99% 4.17% 4.21% 3.91%
FTE adjustment   1,393    1,308    1,130    1,925    1,751 
Amortization of intangibles   2,745    2,785    2,837    2,839    1,724 
Amortization of intangibles, net of taxes   2,027    2,057    2,096    1,725    1,048 
Average diluted shares outstanding   92,840,851    92,733,140    92,638,765    87,036,044    64,847,592 
Cash dividends declared per common share   0.15    0.15    0.15    0.13    0.13 
Financial Highlights - Core (non-GAAP)     
Core earnings (excludes non-core items) (1)$  56,504 $  54,660 $  52,618 $  42,018 $  27,746 
Diluted core earnings per share (1)   0.61    0.59    0.57    0.48    0.43 
Core net interest margin (FTE) (2) 3.71% 3.70% 3.82% 3.70% 3.77%
Accretable yield on acquired loans   10,006    10,113    11,294    15,684    2,890 
Efficiency ratio (1) 53.47% 52.70% 53.24% 51.36% 55.06%
Core return on average assets (1) 1.40% 1.41% 1.41% 1.20% 1.20%
Core return on average common equity (1) 10.30% 10.26% 10.15% 8.63% 8.77%
Core return on tangible common equity (1) 18.80% 19.06% 19.23% 15.97% 13.93%
YEAR-TO-DATE     
Financial Highlights - GAAP     
Net Income$  160,067 $  104,874 $  51,312 $  92,940 $  74,037 
Diluted earnings per share   1.72    1.13    0.55    1.33    1.16 
Return on average assets 1.37% 1.38% 1.38% 0.92% 1.12%
Return on average common equity 10.01% 9.98% 9.90% 6.68% 8.18%
Return on tangible common equity 18.61% 18.73% 18.77% 11.26% 12.97%
Net interest margin (FTE) 4.04% 4.08% 4.17% 4.07% 3.99%
FTE adjustment   3,831    2,438    1,130    7,723    5,798 
Amortization of intangibles   8,367    5,622    2,837    7,666    4,827 
Amortization of intangibles, net of taxes   6,180    4,153    2,096    4,659    2,934 
Average diluted shares outstanding   92,796,860    92,692,234    92,638,765    69,852,920    64,014,270 
Cash dividends declared per common share   0.45    0.30    0.15    0.50    0.38 
Financial Highlights - Core (non-GAAP)     
Core earnings (excludes non-core items) (1)$  163,782 $  107,278 $  52,618 $  119,049 $  77,031 
Diluted core earnings per share (1)   1.76    1.16    0.57    1.70    1.20 
Core net interest margin (FTE) (2) 3.74% 3.76% 3.82% 3.76% 3.79%
Accretable yield on acquired loans   31,413    21,407    11,294    27,793    12,109 
Efficiency ratio (1) 53.14% 52.97% 53.24% 55.27% 57.25%
Core return on average assets (1) 1.41% 1.41% 1.41% 1.18% 1.17%
Core return on average common equity (1) 10.24% 10.20% 10.15% 8.56% 8.51%
Core return on tangible common equity (1) 19.03% 19.14% 19.23% 14.28% 13.48%
END OF PERIOD     
Book value per share$  23.66 $  23.26 $  22.86 $  22.65 $  19.51 
Tangible book value per share   13.48    13.05    12.62    12.34    12.82 
Shares outstanding   92,291,070    92,281,370    92,242,389    92,029,118    64,424,484 
Full-time equivalent employees   2,635    2,659    2,626    2,640    1,942 
Total number of financial centers   191    199    200    200    156 
      
 (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.      
      

 

 Simmons First National Corporation     SFNC 
 Consolidated - Reconciliation of Core Earnings (non-GAAP)    
 For the Quarters Ended  Sep 30  Jun 30  Mar 31  Dec 31  Sep 30 
 (Unaudited)   2018    2018    2018    2017    2017  
($ in thousands, except per share data)               
QUARTER-TO-DATE     
 Net Income $  55,193 $  53,562 $  51,312 $  18,903 $  28,852 
 Non-core items      
Gain on sale of P&C insurance business   -     -     -     -     (3,708)
Donation to Simmons Foundation   -     -     -     5,000    -  
Merger-related costs   804    1,465    1,711    14,044    752 
Branch right-sizing   970    22    57    116    435 
Tax effect (1)   (463)   (389)   (462)   (7,516)   1,415 
 Net non-core items (before SAB 118 adjustment)    1,311    1,098    1,306    11,644    (1,106)
SAB 118 adjustment (2)   -     -     -     11,471    -  
 Core earnings (non-GAAP) $  56,504 $  54,660 $  52,618 $  42,018 $  27,746 
                
 Diluted earnings per share $  0.59 $  0.58 $  0.55 $  0.22 $  0.44 
 Non-core items      
Gain on sale of P&C insurance business   -     -     -     -     (0.06)
Donation to Simmons Foundation   -     -     -     0.06    -  
Merger-related costs   0.01    0.02    0.02    0.17    0.01 
Branch right-sizing   0.01    -     -     -     0.01 
Tax effect (1)   -     (0.01)   -     (0.10)   0.03 
 Net non-core items (before SAB 118 adjustment)    0.02    0.01    0.02    0.13    (0.01)
SAB 118 adjustment (2)   -     -     -     0.13    -  
 Core earnings (non-GAAP) $  0.61 $  0.59 $  0.57 $  0.48 $  0.43 
                
YEAR-TO-DATE     
 Net Income $  160,067 $  104,874 $  51,312 $  92,940 $  74,037 
 Non-core items      
Gain on sale of P&C insurance business   -     -     -     (3,708)   (3,708)
Donation to Simmons Foundation   -     -     -     5,000    -  
Merger-related costs   3,980    3,176    1,711    21,923    7,879 
Branch right-sizing   1,049    79    57    169    53 
Tax effect (1)   (1,314)   (851)   (462)   (8,746)   (1,230)
 Net non-core items (before SAB 118 adjustment)    3,715    2,404    1,306    14,638    2,994 
SAB 118 adjustment (2)   -     -     -     11,471    -  
 Core earnings (non-GAAP) $  163,782 $  107,278 $  52,618 $  119,049 $  77,031 
                
 Diluted earnings per share $  1.72 $  1.13 $  0.55 $  1.33 $  1.16 
 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    0.04    0.02    0.31    0.12 
Branch right-sizing   0.01    -     -     -     -  
Tax effect (1)   (0.01)   (0.01)   -     (0.13)   (0.02)
 Net non-core items (before SAB 118 adjustment)    0.04    0.03    0.02    0.21    0.04 
SAB 118 adjustment (2)   -     -     -     0.16    -  
 Core earnings (non-GAAP) $  1.76 $  1.16 $  0.57 $  1.70 $  1.20 
                
 (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.   
      

 

Simmons First National Corporation     SFNC 
 Reconciliation Of Non-GAAP Financial Measures - End of Period    
 For the Quarters Ended      
 (Unaudited)  Sept 30  Jun 30  Mar 31  Dec 31  Sept 30 
   2018    2018    2018    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$  2,183,319 $  2,146,908 $  2,109,051 $  2,084,564 $  1,257,199 
Intangible assets:     
  Goodwill   (845,687)   (845,687)   (845,687)   (842,651)   (375,731)
  Other intangible assets   (93,975)   (96,720)   (99,504)   (106,071)   (55,501)
Total intangibles   (939,662)   (942,407)   (945,191)   (948,722)   (431,232)
Tangible common stockholders' equity$  1,243,657 $  1,204,501 $  1,163,860 $  1,135,842 $  825,967 
                
Total assets$  16,281,264 $  16,165,533 $  15,597,309 $  15,055,806 $  9,535,370 
Intangible assets:     
  Goodwill   (845,687)   (845,687)   (845,687)   (842,651)   (375,731)
  Other intangible assets   (93,975)   (96,720)   (99,504)   (106,071)   (55,501)
Total intangibles   (939,662)   (942,407)   (945,191)   (948,722)   (431,232)
Tangible assets$  15,341,602 $  15,223,126 $  14,652,118 $  14,107,084 $  9,104,138 
                
Ratio of equity to assets 13.41% 13.28% 13.52% 13.85% 13.18%
Ratio of tangible common equity to tangible assets 8.11% 7.91% 7.94% 8.05% 9.07%
                
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$  53,968 $  68,282 $  79,087 $  89,275 $  24,994 
Allowance for loan losses on acquired loans   1,345    2,044    407    418    391 
Total credit discount and ALLL on acquired loans$  55,313 $  70,326 $  79,494 $  89,693 $  25,385 
Total loans acquired$  3,790,234 $  4,302,760 $  4,776,439 $  5,163,769 $  1,117,424 
Discount and ALLL on acquired loans to acquired loans 1.46% 1.63% 1.66% 1.74% 2.27%
                
Calculation of Total Allowance and Credit Coverage     
      
Allowance for loan losses$  55,358 $  51,732 $  47,207 $  41,668 $  42,717 
Total credit discount and ALLL on acquired loans   55,313    70,326    79,494    89,693    25,385 
Total allowance and credit discount$  110,671 $  122,058 $  126,701 $  131,361 $  68,102 
Total loans$  11,913,508 $  11,436,221 $  11,066,822 $  10,869,378 $  6,328,736 
Total allowance and credit coverage 0.93% 1.07% 1.14% 1.21% 1.08%
                
Calculation of Tangible Book Value per Share     
      
Total common stockholders' equity$  2,183,319 $  2,146,908 $  2,109,051 $  2,084,564 $  1,257,199 
Intangible assets:     
  Goodwill   (845,687)   (845,687)   (845,687)   (842,651)   (375,731)
  Other intangible assets   (93,975)   (96,720)   (99,504)   (106,071)   (55,501)
Total intangibles   (939,662)   (942,407)   (945,191)   (948,722)   (431,232)
Tangible common stockholders' equity$  1,243,657 $  1,204,501 $  1,163,860 $  1,135,842 $  825,967 
Shares of common stock outstanding   92,291,070    92,281,370    92,242,389    92,029,118    64,424,484 
Book value per common share$  23.66 $  23.26 $  22.86 $  22.65 $  19.51 
Tangible book value per common share$  13.48 $  13.05 $  12.62 $  12.34 $  12.82 
                

 

Simmons First National Corporation     SFNC 
 Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date    
 For the Quarters Ended      
 (Unaudited)  Sept 30  Jun 30  Mar 31  Dec 31  Sept 30 
   2018    2018    2018    2017    2017  
($ in thousands)               
Calculation of Core Return on Average Assets     
      
Net income$  55,193 $  53,562 $  51,312 $  18,903 $  28,852 
Net non-core items, net of taxes, adjustment   1,311    1,098    1,306    23,115    (1,106)
Core earnings$  56,504 $  54,660 $  52,618 $  42,018 $  27,746 
                
Average total assets$  16,040,884 $  15,580,697 $  15,088,210 $  13,897,778 $  9,175,607 
                
Return on average assets 1.37% 1.38% 1.38% 0.54% 1.25%
Core return on average assets 1.40% 1.41% 1.41% 1.20% 1.20%
                
Calculation of Return on Tangible Common Equity     
      
Net income$  55,193 $  53,562 $  51,312 $  18,903 $  28,852 
Amortization of intangibles, net of taxes   2,027    2,057    2,096    1,725    1,048 
Total income available to common stockholders$  57,220 $  55,619 $  53,408 $  20,628 $  29,900 
                
Net non-core items, net of taxes   1,311    1,098    1,306    23,115    (1,106)
Core earnings   56,504    54,660    52,618    42,018    27,746 
Amortization of intangibles, net of taxes   2,027    2,057    2,096    1,725    1,048 
Total core income available to common stockholders$  58,531 $  56,717 $  54,714 $  43,743 $  28,794 
                
Average common stockholders' equity$  2,176,565 $  2,137,097 $  2,103,052 $  1,931,804 $  1,255,694 
Average intangible assets:     
  Goodwill   (845,687)   (845,687)   (844,148)   (731,661)   (378,387)
  Other intangibles   (95,576)   (98,152)   (104,718)   (113,770)   (57,232)
Total average intangibles   (941,263)   (943,839)   (948,866)   (845,431)   (435,619)
Average tangible common stockholders' equity$  1,235,302 $  1,193,258 $  1,154,186 $  1,086,373 $  820,075 
                
Return on average common equity 10.06% 10.05% 9.90% 3.88% 9.12%
Return on tangible common equity 18.38% 18.70% 18.77% 7.53% 14.47%
Core return on average common equity 10.30% 10.26% 10.15% 8.63% 8.77%
Core return on tangible common equity 18.80% 19.06% 19.23% 15.97% 13.93%
                
Calculation of Efficiency Ratio (1)     
      
Non-interest expense$  100,253 $  98,507 $  98,073 $  108,490 $  66,159 
Non-core non-interest expense adjustment   (1,774)   (1,483)   (1,772)   (19,160)   (862)
Other real estate and foreclosure expense adjustment   (538)   (1,382)   (1,020)   (865)   (1,071)
Amortization of intangibles adjustment   (2,745)   (2,785)   (2,837)   (2,839)   (1,724)
Efficiency ratio numerator$  95,196 $  92,857 $  92,444 $  85,626 $  62,502 
                
Net-interest income$  142,968 $  136,837 $  134,966 $  126,919 $  78,819 
Non-interest income   33,725    38,048    37,535    36,629    36,332 
Non-core non-interest income adjustment   -     4    (4)   -     (3,383)
Fully tax-equivalent adjustment   1,393    1,308    1,130    1,925    1,751 
(Gain) loss on sale of securities   (54)   7    (6)   1,243    (3)
Efficiency ratio denominator$  178,032 $  176,204 $  173,621 $  166,716 $  113,516 
                
Efficiency ratio (1) 53.47% 52.70% 53.24% 51.36% 55.06%
                
Calculation of Core Net Interest Margin     
      
Net interest income$  142,968 $  136,837 $  134,966 $  126,919 $  78,819 
Fully tax-equivalent adjustment   1,393    1,308    1,130    1,925    1,751 
Fully tax-equivalent net interest income   144,361    138,145    136,096    128,844    80,570 
      
Total accretable yield   (10,006)   (10,113)   (11,294)   (15,684)   (2,890)
Core net interest income$  134,355 $  128,032 $  124,802 $  113,160 $  77,680 
Average earning assets$  14,373,253 $  13,876,557 $  13,251,549 $  12,145,003 $  8,182,292 
                
Net interest margin 3.98% 3.99% 4.17% 4.21% 3.91%
Core net interest margin 3.71% 3.70% 3.82% 3.70% 3.77%
                
Calculation of Core Loan Yield     
      
Loan interest income$  162,438 $  150,253 $  143,350 $  132,617 $  77,457 
Total accretable yield   (10,006)   (10,113)   (11,294)   (15,684)   (2,890)
Core loan interest income$  152,432 $  140,140 $  132,056 $  116,933 $  74,567 
Average loan balance$  11,641,843 $  11,159,872 $  10,819,324 $  9,772,043 $  6,261,507 
                
Core loan yield 5.19% 5.04% 4.95% 4.75% 4.72%
                
(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. 
      

 

Simmons First National Corporation     SFNC 
 Reconciliation Of Non-GAAP Financial Measures - Year-to-Date     
 For the Quarters Ended      
 (Unaudited)  Sept 30  Jun 30  Mar 31  Dec 31  Sept 30 
   2018    2018    2018    2017    2017  
($ in thousands)               
Calculation of Core Return on Average Assets     
      
Net income$  160,067 $  104,874 $  51,312 $  92,940 $  74,037 
Net non-core items, net of taxes, adjustment   3,715    2,404    1,306    26,109    2,994 
Core earnings$  163,782 $  107,278 $  52,618 $  119,049 $  77,031 
                
Average total assets$  15,573,762 $  15,334,453 $  15,088,210 $  10,074,951 $  8,800,675 
                
Return on average assets 1.37% 1.38% 1.38% 0.92% 1.12%
Core return on average assets 1.41% 1.41% 1.41% 1.18% 1.17%
                
Calculation of Return on Tangible Common Equity     
      
Net income$  160,067 $  104,874 $  51,312 $  92,940 $  74,037 
Amortization of intangibles, net of taxes   6,180    4,153    2,096    4,659    2,934 
Total income available to common stockholders$  166,247 $  109,027 $  53,408 $  97,599 $  76,971 
                
Net non-core items, net of taxes   3,715    2,404    1,306    26,109    2,994 
Core earnings   163,782    107,278    52,618    119,049    77,031 
Amortization of intangibles, net of taxes   6,180    4,153    2,096    4,659    2,934 
Total core income available to common stockholders$  169,962 $  111,431 $  54,714 $  123,708 $  79,965 
                
Average common stockholders' equity$  2,138,818 $  2,120,075 $  2,103,052 $  1,390,815 $  1,210,487 
Average intangible assets:     
  Goodwill   (845,180)   (844,917)   (844,148)   (455,453)   (363,383)
  Other intangibles   (99,448)   (101,435)   (104,718)   (68,896)   (53,941)
Total average intangibles   (944,628)   (946,352)   (948,866)   (524,349)   (417,324)
Average tangible common stockholders' equity$  1,194,190 $  1,173,723 $  1,154,186 $  866,466 $  793,163 
                
Return on average common equity 10.01% 9.98% 9.90% 6.68% 8.18%
Return on tangible common equity 18.61% 18.73% 18.77% 11.26% 12.97%
Core return on average common equity 10.24% 10.20% 10.15% 8.56% 8.51%
Core return on tangible common equity 19.03% 19.14% 19.23% 14.28% 13.48%
                
Calculation of Efficiency Ratio (1)     
      
Non-interest expense$  296,833 $  196,580 $  98,073 $  312,379 $  203,889 
Non-core non-interest expense adjustment   (5,029)   (3,255)   (1,772)   (27,357)   (8,197)
Other real estate and foreclosure expense adjustment   (2,940)   (2,402)   (1,020)   (3,042)   (2,177)
Amortization of intangibles adjustment   (8,367)   (5,622)   (2,837)   (7,666)   (4,827)
Efficiency ratio numerator$  280,497 $  185,301 $  92,444 $  274,314 $  188,688 
                
Net-interest income$  414,771 $  271,803 $  134,966 $  354,930 $  228,011 
Non-interest income   109,308    75,583    37,535    138,765    102,136 
Non-core non-interest income adjustment   -     -     (4)   (3,972)   (3,972)
Fully tax-equivalent adjustment   3,831    2,438    1,130    7,723    5,798 
(Gain) loss on sale of securities   (53)   1    (6)   (1,059)   (2,302)
Efficiency ratio denominator$  527,857 $  349,825 $  173,621 $  496,387 $  329,671 
                
Efficiency ratio (1) 53.14% 52.97% 53.24% 55.27% 57.25%
                
Calculation of Core Net Interest Margin     
      
Net interest income$  414,771 $  271,803 $  134,966 $  354,930 $  228,011 
Fully tax-equivalent adjustment   3,831    2,438    1,130    7,723    5,798 
Fully tax-equivalent net interest income   418,602    274,241    136,096    362,653    233,809 
      
Total accretable yield   (31,413)   (21,407)   (11,294)   (27,793)   (12,109)
Core net interest income$  387,189 $  252,834 $  124,802 $  334,860 $  221,700 
Average earning assets$  13,837,639 $  13,564,056 $  13,251,549 $  8,908,418 $  7,829,548 
                
Net interest margin 4.04% 4.08% 4.17% 4.07% 3.99%
Core net interest margin 3.74% 3.76% 3.82% 3.76% 3.79%
                
Calculation of Core Loan Yield     
      
Loan interest income$  456,041 $  293,603 $  143,350 $  352,351 $  219,734 
Total accretable yield   (31,413)   (21,407)   (11,294)   (27,793)   (12,109)
Core loan interest income$  424,628 $  272,196 $  132,056 $  324,558 $  207,625 
Average loan balance$  11,209,992 $  10,989,600 $  10,819,324 $  6,918,293 $  5,967,036 
                
Core loan yield 5.06% 4.99% 4.95% 4.69% 4.65%
                
(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.