Financial News

Guaranty Bancshares, Inc. Reports First Quarter 2024 Financial Results

Guaranty Bancshares, Inc. (NYSE: GNTY) (the “Company”), the parent company of Guaranty Bank & Trust, N.A. (the “Bank”), today reported financial results for the fiscal quarter ended March 31, 2024. The Company’s net income available to common shareholders was $6.7 million, or $0.58 per basic share, for the quarter ended March 31, 2024, compared to $5.9 million, or $0.51 per basic share, for the quarter ended December 31, 2023 and $8.3 million, or $0.69 per basic share, for the quarter ended March 31, 2023. Return on average assets and average equity for the first quarter of 2024 were 0.85% and 8.93%, respectively, compared to 0.73% and 7.93%, respectively, for the fourth quarter of 2023 and 1.01% and 11.18%, respectively, for the first quarter of 2023. The increase in earnings during the first quarter of 2024 compared to the fourth quarter of 2023 was primarily due to higher non-interest income and lower non-interest expense. The decrease in earnings in the first quarter of 2024 compared to the first quarter of 2023 was primarily due to lower net interest income in the current quarter compared to the prior year quarter.

“We are pleased with our first quarter 2024 results. During the quarter, net interest margin continued to improve, we paid down borrowings from the FHLB, we repaid the remaining $25.0 million of brokered CDs that were obtained to test as a source of liquidity, our core deposits are stable and grew slightly and credit quality remains manageable. Although we’ve strategically shrunk the balance sheet primarily through more conservative loan underwriting, our balance sheet remains strong and continues to provide consistent earnings results. Liquidity and capital remain solid and our board of directors increased the dividend paid on GNTY stock from $0.23 last quarter to $0.24 this quarter, further improving shareholder returns and value,” said Ty Abston, the Company’s Chairman and Chief Executive Officer.

QUARTERLY HIGHLIGHTS

  • Good Earnings and Improving NIM. Earnings were good in the first quarter as net interest margin improved and non-interest income was boosted from sales of SBA and mortgage loans as well as recoveries from previously marked-down receivables due from the SBA. Net interest margin, on a fully taxable equivalent basis, has continued to improve from 3.02% in the third quarter of 2023 to 3.11% in the fourth quarter of 2023 and 3.16% in the first quarter of 2024. The improvements have resulted primarily from a slow-down in deposit cost increases, while earning assets have continued to reprice upward. The SBA receivable was related to the guaranteed portion of three SBA loans that were acquired from Westbound Bank. The receivable was partially written down in the third quarter of 2022, as there was uncertainty at that time about possible SBA haircuts in the guaranteed portion due to file documentation. However, after extensive review by the SBA, the full amount of guarantees was received during the first quarter of 2024.
  • Stable Asset Quality. Although we are seeing some deterioration for certain borrowers, overall credit quality remains strong and the expected losses on deteriorating credits are low primarily due to the Bank's equity position and/or strong guarantor support. During the quarter, we foreclosed on a multi-purpose commercial real estate loan in a vibrant location in the South Austin area and recorded other real estate owned of $14.9 million. A recent appraisal indicates an LTV (prior to foreclosure) of 68.5%. Interest in purchasing the property has been high and we are in discussions with several interested parties. We expect little or no loss on the sale of this other real estate owned. Nonperforming assets as a percentage of total assets were 0.68% at March 31, 2024, compared to 0.18% at December 31, 2023 and 0.40% at March 31, 2023. Net charge-offs (annualized) to average loans were 0.02% for the quarter ended March 31, 2024, compared to 0.04% for the quarter ended December 31, 2023, and 0.00% for the quarter ended March 31, 2023.



    Commercial real estate (CRE) loans, particularly office related loans, have received increased scrutiny in recent months. As of March 31, 2024, our CRE loans and real estate C&D loans represent 40.0% and 12.1% of the total loan portfolio, respectively, and office-related loans represent 4.6% of the total loan portfolio and have an average balance of $516,000.
  • Granular and Consistent Core Deposit Base. As of March 31, 2024, we have 88,493 total deposit accounts with an average account balance of $29,696. We have a historically reliable core deposit base, with strong and trusted banking relationships. Total deposits decreased by $5.4 million during the first quarter, which resulted primarily from the maturity of $25.0 million in brokered deposits in February 2024 that we did not renew. Excluding these brokered CDs, total core deposits grew $19.6 million during the first quarter. DDA balances decreased $27.1 million, savings and MMDA balances increased $30.8 million and time deposits (excluding matured brokered CDs) increased $15.9 million. Excluding public funds and bank-owned accounts, our uninsured deposits as of March 31, 2024 were 25.43% of total deposits.



    Interest rates paid on deposits during the quarter stabilized with minimal increases. Despite the decrease in DDA during the quarter, noninterest-bearing deposits still represent 31.5% of total deposits. Our cost of interest-bearing deposits increased eight basis points during the quarter from 3.17% in the prior quarter to 3.25%. This increase was primarily due to renewals of maturing certificates of deposit into new CDs paying higher rates and the shift from noninterest-bearing balances to interest-bearing. Our cost of total deposits for the first quarter of 2024 increased nine basis points from 2.14% in the prior quarter to 2.23%.
  • Healthy Capital and Liquidity. Our capital and liquidity ratios, as well as contingent liquidity sources, remain very healthy. During the first quarter of 2024, we repurchased 11,651 shares of our common stock, or 0.10% of average shares outstanding during the period, at an average price of $28.76 per share. Our liquidity ratio, calculated as cash and cash equivalents and unpledged investments divided by total liabilities, was 10.6% as of March 31, 2024, compared to 15.3% as of March 31, 2023. Our total available contingent liquidity, net of current outstanding borrowings, was $1.3 billion, consisting of FHLB, FRB and correspondent bank fed funds and revolving lines of credit. Finally, our total equity to average quarterly assets as of March 31, 2024 was 9.6%. If we had to recognize our entire unrealized losses on both AFS and HTM securities, our total equity to average assets ratio would be 8.8%, which we believe represents a strong capital level under regulatory requirements.

† Non-GAAP financial metric. Calculations of this metric and reconciliations to GAAP are included in the schedules accompanying this release.

RESULTS OF OPERATIONS

Net interest income, before the provision for credit losses, in the first quarter of 2024 and 2023 was $23.6 million and $25.2 million, respectively, a decrease of $1.6 million, or 6.3%. The decrease in net interest income resulted from an increase in interest expense of $5.2 million, or 43.3%, compared to the prior year quarter, which was partially offset by an increase in interest income of $3.6 million, or 9.7%, from the same quarter in the prior year. The increases in both interest income and expense resulted primarily from higher rates during the period. Interest expense was also somewhat impacted by a shift from noninterest-bearing to interest-bearing deposit accounts, which resulted in increased expense in the first quarter of 2024 compared to the prior year quarter. Our noninterest-bearing deposits to total deposits were 31.5% and 37.8% as of March 31, 2024 and 2023, respectively.

Net interest margin, on a fully taxable equivalent basis, for the first quarter of 2024 and 2023 was 3.16% and 3.24%, respectively. Net interest margin, on a fully taxable equivalent basis, decreased nine basis points primarily due to interest-bearing liabilities repricing faster than our interest-earning assets during the period. The cost of interest-bearing liabilities increased 98 basis points from the prior year quarter, while interest earning asset yields increased 70 basis points. The increase in the cost of interest-bearing liabilities was due primarily to an increase in the cost of interest-bearing deposits from 1.91% to 3.25%, a change of 134 basis points, in the first quarter of 2024 compared to the same period in 2023, as well as increased rates on FHLB advances, which increased from 4.94% to 5.45%, an increase of 51 basis points, from the prior year quarter. The increases in cost were partially offset by increases in yield on the loan portfolio from 5.46% to 6.21%, or 75 basis points, as well as 109 and 13 basis point increases in yield on AFS and HTM securities, respectively. Although the cost of interest-bearing liabilities have repriced more quickly during this period, the weighted average yield on $62.9 million in new loans originated in the first quarter was 8.39%.

Net interest income, before the provision for credit losses, decreased $226,000, or 0.9%, from $23.8 million in the fourth quarter of 2023 to $23.6 million in the first quarter of 2024. The decrease in net interest income resulted primarily from an increase in interest expense of $182,000, or 1.1%, and a decrease in interest income of $44,000, or 0.1%. The decrease in interest income was primarily due to a decrease in gross loans of $57.3 million, or 2.5%.

Net interest margin, on a fully taxable equivalent basis, increased from 3.11% for the fourth quarter of 2023 to 3.16% for the first quarter of 2024, an increase of four basis points. The increase in net interest margin, on a fully taxable equivalent basis, was primarily due to an increase on loan yield from 6.06% for the fourth quarter of 2023 to 6.21% for the first quarter of 2024, a change of 15 basis points, and a decrease in total interest-earning assets during the first quarter of 2024. This increase was partially offset by an increase in the cost of interest-bearing deposits from 3.17% in the fourth quarter of 2023 to 3.25% in the first quarter of 2024, a change of eight basis points.

We recorded a $250,000 reversal to our provision for credit losses during the first quarter of 2024. Our loan balances decreased $57.3 million during the quarter, while credit quality trends remained relatively stable and the qualitative factors used to account for changes in economic conditions and expected losses were adjusted in 2023. Those assumptions remain relevant in the current quarter, thus no additional q-factor adjustments were made in the current quarter. As of March 31, 2024 and December 31, 2023, our allowance for credit losses as a percentage of total loans was 1.35% and 1.33%, respectively.

Noninterest income increased $353,000, or 7.2%, in the first quarter of 2024 to $5.3 million, compared to $4.9 million for the first quarter of 2023. The increase from the same quarter in 2023 was primarily due to $499,000 in recoveries made on three SBA loans during the first quarter of 2024. This was partially offset by a $130,000 decrease in the gain on mortgage loans sold and a decrease on the gain on sale of loans of $42,000, or 13.4%, along with a $27,000, or 39.7%, decrease in mortgage fee income compared to the same quarter in the prior year.

Noninterest expense increased $725,000, or 3.6%, in the first quarter of 2024 to $20.7 million, compared to $20.0 million for the first quarter of 2023. The increase in noninterest expense in the first quarter of 2024 was driven primarily by a $189,000, or 32.4%, increase in legal and professional fees primarily related to recruiting fees, an increase in software and technology expense of $246,000, or 17.6%, and a $173,000, or 1.4%, increase in employee compensation and benefits compared to the first quarter of 2023. These were partially offset by a $98,000, or 36.7%, decrease in advertising and promotions expense.

Noninterest income in the first quarter of 2024 increased by $462,000, or 9.6%, from $4.8 million in the fourth quarter of 2023. The increase was primarily due to an increase in other noninterest income of $454,000, or 65.0%, primarily the result of $499,000 in recoveries made on three SBA loans and an increase in the gain on sale of loans of $76,000, or 38.8%, during the first quarter of 2024.

Noninterest expense decreased $710,000, or 3.3%, in the first quarter of 2024, from $21.4 million for the quarter ended December 31, 2023. The decrease resulted from a $278,000, or 2.2%, decrease in employee compensation and benefits due to a retirement accrual booked in the fourth quarter of 2023, which was not present in 2024. Additionally, there was a $183,000, or 52.0%, decrease in advertising and promotions expense, a $182,000, or 19.1%, decrease in legal and professional fees and a $98,000, or 5.6%, decrease in software and technology expense during the first quarter of 2024 compared to the fourth quarter of 2023.

The Company’s efficiency ratio in the first quarter of 2024 was 71.74%, compared to 66.41% in the prior year quarter and 74.81% in the fourth quarter of 2024.

FINANCIAL CONDITION

Consolidated assets for the Company totaled $3.13 billion at March 31, 2024, compared to $3.18 billion at December 31, 2023 and $3.36 billion at March 31, 2023.

Gross loans decreased by $57.3 million, or 2.5%, during the quarter resulting in a gross loan balance of $2.27 billion at March 31, 2024, compared to $2.32 billion at December 31, 2023. Our decline in loans resulted primarily from tighter underwriting due to the current economic environment and from lower demand from potential borrowers.

Gross loans decreased $112.6 million, or 4.7%, from $2.38 billion at March 31, 2023. The decrease in gross loans during the first quarter of 2024 compared to the first quarter of 2023 resulted from tightened credit underwriting standards and loan terms, along with fewer borrower requests in response to higher interest rates. Additionally, there was a $10.7 million decrease in warehouse lending loans, as we discontinued that line of business in the second quarter of 2023.

Total deposits decreased by $5.4 million, or 0.2%, to $2.63 billion at March 31, 2024, compared to $2.63 billion at December 31, 2023, and increased $4.5 million, or 0.2%, from $2.62 billion at March 31, 2023. The decrease in deposits during the first quarter of 2024 compared to the fourth quarter of 2023 was the result of a decrease in noninterest-bearing deposits of $24.1 million, offset by an increase in interest-bearing deposits of $18.7 million. The decrease in interest-bearing deposits included the maturity of $25.0 million in brokered CDs in February 2024 that we did not renew. The increase in deposits during the current quarter compared to the prior year quarter resulted primarily from an increase in interest-bearing deposits of $168.1 million, partially offset by a decrease in noninterest-bearing deposits of $163.7 million.

Nonperforming assets as a percentage of total loans were 0.94% at March 31, 2024, compared to 0.25% at December 31, 2023 and 0.57% at March 31, 2023. Nonperforming assets as a percentage of total assets were 0.68% at March 31, 2024, compared to 0.18% at December 31, 2023, and 0.40% at March 31, 2023. The Bank’s nonperforming assets consist primarily of other real estate owned and nonaccrual loans. The increase in nonperforming assets compared to the prior year end and prior year quarter was primarily due to the increase in other real estate owned, which is described in the quarterly highlights above.

Total equity was $305.9 million at March 31, 2024, compared to $303.8 million at December 31, 2023 and $300.3 million at March 31, 2023. The increase in total equity compared to the prior year end and prior year quarter resulted primarily from net income of $6.7 million, the payment of dividends of $2.8 million during the period and a reduction in repurchases during the first quarter of 2024 compared to prior quarters.

 

 

As of

 

 

 

2024

 

 

2023

 

(dollars in thousands)

 

March 31

 

 

December 31

 

 

September 30

 

 

June 30

 

 

March 31

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

43,872

 

 

$

47,744

 

 

$

47,922

 

 

$

47,663

 

 

$

59,030

 

Federal funds sold

 

 

24,300

 

 

 

36,575

 

 

 

73,275

 

 

 

44,950

 

 

 

95,400

 

Interest-bearing deposits

 

 

4,921

 

 

 

5,205

 

 

 

8,980

 

 

 

4,738

 

 

 

3,695

 

Total cash and cash equivalents

 

 

73,093

 

 

 

89,524

 

 

 

130,177

 

 

 

97,351

 

 

 

158,125

 

Securities available for sale

 

 

228,787

 

 

 

196,195

 

 

 

178,644

 

 

 

166,596

 

 

 

173,744

 

Securities held to maturity

 

 

363,963

 

 

 

404,208

 

 

 

408,308

 

 

 

437,292

 

 

 

476,105

 

Loans held for sale

 

 

874

 

 

 

976

 

 

 

2,506

 

 

 

795

 

 

 

1,260

 

Loans, net

 

 

2,234,012

 

 

 

2,290,881

 

 

 

2,286,163

 

 

 

2,300,882

 

 

 

2,344,240

 

Accrued interest receivable

 

 

11,747

 

 

 

13,143

 

 

 

11,307

 

 

 

11,110

 

 

 

10,443

 

Premises and equipment, net

 

 

56,921

 

 

 

57,018

 

 

 

56,712

 

 

 

56,151

 

 

 

55,457

 

Other real estate owned

 

 

14,900

 

 

 

 

 

 

 

 

 

 

 

 

38

 

Cash surrender value of life insurance

 

 

42,119

 

 

 

42,348

 

 

 

42,096

 

 

 

41,830

 

 

 

38,619

 

Core deposit intangible, net

 

 

1,312

 

 

 

1,418

 

 

 

1,524

 

 

 

1,633

 

 

 

1,746

 

Goodwill

 

 

32,160

 

 

 

32,160

 

 

 

32,160

 

 

 

32,160

 

 

 

32,160

 

Other assets

 

 

67,550

 

 

 

56,920

 

 

 

80,816

 

 

 

60,396

 

 

 

64,350

 

Total assets

 

$

3,127,438

 

 

$

3,184,791

 

 

$

3,230,413

 

 

$

3,206,196

 

 

$

3,356,287

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing

 

$

828,861

 

 

$

852,957

 

 

$

903,391

 

 

$

915,462

 

 

$

992,527

 

Interest-bearing

 

 

1,798,983

 

 

 

1,780,289

 

 

 

1,754,902

 

 

 

1,687,355

 

 

 

1,630,841

 

Total deposits

 

 

2,627,844

 

 

 

2,633,246

 

 

 

2,658,293

 

 

 

2,602,817

 

 

 

2,623,368

 

Securities sold under agreements to repurchase

 

 

39,058

 

 

 

25,172

 

 

 

19,366

 

 

 

20,532

 

 

 

13,338

 

Accrued interest and other liabilities

 

 

33,807

 

 

 

32,242

 

 

 

31,218

 

 

 

30,701

 

 

 

30,125

 

Line of credit

 

 

 

 

 

4,500

 

 

 

2,000

 

 

 

12,000

 

 

 

 

Federal Home Loan Bank advances

 

 

75,000

 

 

 

140,000

 

 

 

175,000

 

 

 

195,000

 

 

 

340,000

 

Subordinated debentures

 

 

45,819

 

 

 

45,785

 

 

 

47,752

 

 

 

47,719

 

 

 

49,186

 

Total liabilities

 

 

2,821,528

 

 

 

2,880,945

 

 

 

2,933,629

 

 

 

2,908,769

 

 

 

3,056,017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity attributable to Guaranty Bancshares, Inc.

 

 

305,371

 

 

 

303,300

 

 

 

296,226

 

 

 

296,862

 

 

 

299,700

 

Noncontrolling interest

 

 

539

 

 

 

546

 

 

 

558

 

 

 

565

 

 

 

570

 

Total equity

 

 

305,910

 

 

 

303,846

 

 

 

296,784

 

 

 

297,427

 

 

 

300,270

 

Total liabilities and equity

 

$

3,127,438

 

 

$

3,184,791

 

 

$

3,230,413

 

 

$

3,206,196

 

 

$

3,356,287

 

 

 

Quarter Ended

 

 

 

2024

 

 

2023

 

(dollars in thousands, except per share data)

 

March 31

 

 

December 31

 

 

September 30

 

 

June 30

 

 

March 31

 

STATEMENTS OF EARNINGS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

40,752

 

 

$

40,796

 

 

$

39,818

 

 

$

38,734

 

 

$

37,144

 

Interest expense

 

 

17,165

 

 

 

16,983

 

 

 

16,516

 

 

 

14,031

 

 

 

11,982

 

Net interest income

 

 

23,587

 

 

 

23,813

 

 

 

23,302

 

 

 

24,703

 

 

 

25,162

 

Reversal of provision for credit losses

 

 

(250

)

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income after provision for credit losses

 

 

23,837

 

 

 

23,813

 

 

 

23,302

 

 

 

24,703

 

 

 

25,162

 

Noninterest income

 

 

5,258

 

 

 

4,796

 

 

 

4,939

 

 

 

7,873

 

 

 

4,905

 

Noninterest expense

 

 

20,692

 

 

 

21,402

 

 

 

20,514

 

 

 

20,471

 

 

 

19,967

 

Income before income taxes

 

 

8,403

 

 

 

7,207

 

 

 

7,727

 

 

 

12,105

 

 

 

10,100

 

Income tax provision

 

 

1,722

 

 

 

1,341

 

 

 

1,437

 

 

 

2,529

 

 

 

1,823

 

Net earnings

 

$

6,681

 

 

$

5,866

 

 

$

6,290

 

 

$

9,576

 

 

$

8,277

 

Net loss attributable to noncontrolling interest

 

 

7

 

 

 

12

 

 

 

7

 

 

 

5

 

 

 

4

 

Net earnings attributable to Guaranty Bancshares, Inc.

 

$

6,688

 

 

$

5,878

 

 

$

6,297

 

 

$

9,581

 

 

$

8,281

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PER COMMON SHARE DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share, basic

 

$

0.58

 

 

$

0.51

 

 

$

0.54

 

 

$

0.82

 

 

$

0.69

 

Earnings per common share, diluted

 

 

0.58

 

 

 

0.51

 

 

 

0.54

 

 

 

0.81

 

 

 

0.69

 

Cash dividends per common share

 

 

0.24

 

 

 

0.23

 

 

 

0.23

 

 

 

0.23

 

 

 

0.23

 

Book value per common share - end of quarter

 

 

26.47

 

 

 

26.28

 

 

 

25.64

 

 

 

25.58

 

 

 

25.13

 

Tangible book value per common share - end of quarter(1)

 

 

23.57

 

 

 

23.37

 

 

 

22.72

 

 

 

22.67

 

 

 

22.29

 

Common shares outstanding - end of quarter(4)

 

 

11,534,960

 

 

 

11,540,644

 

 

 

11,554,094

 

 

 

11,603,167

 

 

 

11,925,357

 

Weighted-average common shares outstanding, basic

 

 

11,539,167

 

 

 

11,536,878

 

 

 

11,568,897

 

 

 

11,735,475

 

 

 

11,939,593

 

Weighted-average common shares outstanding, diluted

 

 

11,598,239

 

 

 

11,589,165

 

 

 

11,619,342

 

 

 

11,756,512

 

 

 

12,012,004

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PERFORMANCE RATIOS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (annualized)

 

 

0.85

%

 

 

0.73

%

 

 

0.78

%

 

 

1.17

%

 

 

1.01

%

Return on average equity (annualized)

 

 

8.93

 

 

 

7.93

 

 

 

8.43

 

 

 

12.87

 

 

 

11.18

 

Net interest margin, fully taxable equivalent (annualized)(2)

 

 

3.16

 

 

 

3.11

 

 

 

3.02

 

 

 

3.19

 

 

 

3.24

 

Efficiency ratio(3)

 

 

71.74

 

 

 

74.81

 

 

 

72.64

 

 

 

62.84

 

 

 

66.41

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) See Non-GAAP Reconciling Tables.

 

(2) Net interest margin on a fully taxable equivalent basis is equal to net interest income adjusted for nontaxable income divided by average interest-earning assets, annualized, using a marginal tax rate of 21%.

 

(3) The efficiency ratio was calculated by dividing total noninterest expense by net interest income plus noninterest income, excluding securities gains or losses. Taxes are not part of this calculation.

 

(4) Excludes the dilutive effect, if any, of shares of common stock issuable upon exercise of outstanding stock options.

 

 

 

As of

 

 

 

2024

 

 

2023

 

(dollars in thousands)

 

March 31

 

 

December 31

 

 

September 30

 

 

June 30

 

 

March 31

 

LOAN PORTFOLIO COMPOSITION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

 

$

269,560

 

 

$

287,565

 

 

$

292,410

 

 

$

295,864

 

 

$

295,936

 

Real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction and development

 

 

273,300

 

 

 

296,639

 

 

 

317,484

 

 

 

345,127

 

 

 

372,203

 

Commercial real estate

 

 

906,684

 

 

 

923,195

 

 

 

901,321

 

 

 

891,883

 

 

 

900,190

 

Farmland

 

 

180,502

 

 

 

186,295

 

 

 

188,614

 

 

 

187,105

 

 

 

190,802

 

1-4 family residential

 

 

523,573

 

 

 

514,603

 

 

 

504,002

 

 

 

496,340

 

 

 

499,944

 

Multi-family residential

 

 

44,569

 

 

 

44,292

 

 

 

42,720

 

 

 

44,385

 

 

 

44,760

 

Consumer

 

 

54,375

 

 

 

57,059

 

 

 

58,294

 

 

 

59,498

 

 

 

60,163

 

Agricultural

 

 

12,418

 

 

 

12,685

 

 

 

13,076

 

 

 

13,447

 

 

 

13,545

 

Overdrafts

 

 

276

 

 

 

243

 

 

 

328

 

 

 

252

 

 

 

270

 

Total loans(1)(2)

 

$

2,265,257

 

 

$

2,322,576

 

 

$

2,318,249

 

 

$

2,333,901

 

 

$

2,377,813

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

 

 

2024

 

 

2023

 

(dollars in thousands)

 

March 31

 

 

December 31

 

 

September 30

 

 

June 30

 

 

March 31

 

ALLOWANCE FOR CREDIT LOSSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

30,920

 

 

$

31,140

 

 

$

31,759

 

 

$

31,953

 

 

$

31,974

 

Loans charged-off

 

 

(310

)

 

 

(242

)

 

 

(644

)

 

 

(224

)

 

 

(94

)

Recoveries

 

 

200

 

 

 

22

 

 

 

25

 

 

 

30

 

 

 

73

 

Reversal of provision for credit loss expense

 

 

(250

)

 

 

 

 

 

 

 

 

 

 

 

 

Balance at end of period

 

$

30,560

 

 

$

30,920

 

 

$

31,140

 

 

$

31,759

 

 

$

31,953

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for credit losses / period-end loans

 

 

1.35

%

 

 

1.33

%

 

 

1.34

%

 

 

1.36

%

 

 

1.34

%

Allowance for credit losses / nonperforming loans

 

 

496.0

 

 

 

552.9

 

 

 

1,148.2

 

 

 

894.6

 

 

 

238.4

 

Net charge-offs / average loans (annualized)

 

 

0.02

 

 

 

0.04

 

 

 

0.11

 

 

 

0.03

 

 

 

0.00

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NONPERFORMING ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans

 

$

6,161

 

 

$

5,592

 

 

$

2,712

 

 

$

3,550

 

 

$

13,405

 

Other real estate owned

 

 

14,900

 

 

 

 

 

 

 

 

 

 

 

 

38

 

Repossessed assets owned

 

 

236

 

 

 

234

 

 

 

250

 

 

 

 

 

 

 

Total nonperforming assets

 

$

21,297

 

 

$

5,826

 

 

$

2,962

 

 

$

3,550

 

 

$

13,443

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonperforming assets as a percentage of:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans(1)(2)

 

 

0.94

%

 

 

0.25

%

 

 

0.13

%

 

 

0.15

%

 

 

0.57

%

Total assets

 

 

0.68

 

 

 

0.18

 

 

 

0.09

 

 

 

0.11

 

 

 

0.40

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Excludes outstanding balances of loans held for sale of $874,000, $976,000, $2.5 million, $795,000, and $1.3 million as of March 31, 2024, and December 31, September 30, June 30, and March 31, 2023, respectively.

 

(2) Excludes deferred loan fees of $685,000, $775,000, $(946,000), $1.3 million, and $1.6 million as of March 31, 2024, and December 31, September 30, June 30, and March 31, 2023, respectively.

 

 

 

Quarter Ended

 

 

 

2024

 

 

2023

 

(dollars in thousands)

 

March 31

 

 

December 31

 

 

September 30

 

 

June 30

 

 

March 31

 

NONINTEREST INCOME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges

 

$

1,069

 

 

$

1,123

 

 

$

1,131

 

 

$

1,056

 

 

$

1,077

 

Net realized (loss) gain on securities transactions

 

 

 

 

 

 

 

 

 

 

 

(322

)

 

 

93

 

Net realized gain on sale of loans

 

 

272

 

 

 

196

 

 

 

218

 

 

 

473

 

 

 

314

 

Fiduciary and custodial income

 

 

649

 

 

 

624

 

 

 

637

 

 

 

630

 

 

 

638

 

Bank-owned life insurance income

 

 

251

 

 

 

249

 

 

 

267

 

 

 

211

 

 

 

214

 

Merchant and debit card fees

 

 

1,706

 

 

 

1,760

 

 

 

1,752

 

 

 

2,121

 

 

 

1,674

 

Loan processing fee income

 

 

118

 

 

 

116

 

 

 

128

 

 

 

142

 

 

 

134

 

Mortgage fee income

 

 

41

 

 

 

30

 

 

 

46

 

 

 

50

 

 

 

68

 

Other noninterest income

 

 

1,152

 

 

 

698

 

 

 

760

 

 

 

3,512

 

 

 

693

 

Total noninterest income

 

$

5,258

 

 

$

4,796

 

 

$

4,939

 

 

$

7,873

 

 

$

4,905

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NONINTEREST EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

$

12,437

 

 

$

12,715

 

 

$

11,944

 

 

$

11,939

 

 

$

12,264

 

Occupancy expenses

 

 

2,747

 

 

 

2,757

 

 

 

2,960

 

 

 

2,754

 

 

 

2,830

 

Legal and professional fees

 

 

772

 

 

 

954

 

 

 

902

 

 

 

985

 

 

 

583

 

Software and technology

 

 

1,642

 

 

 

1,740

 

 

 

1,490

 

 

 

1,531

 

 

 

1,396

 

Amortization

 

 

143

 

 

 

145

 

 

 

147

 

 

 

149

 

 

 

161

 

Director and committee fees

 

 

200

 

 

 

186

 

 

 

192

 

 

 

201

 

 

 

199

 

Advertising and promotions

 

 

169

 

 

 

352

 

 

 

288

 

 

 

269

 

 

 

267

 

ATM and debit card expense

 

 

609

 

 

 

763

 

 

 

803

 

 

 

739

 

 

 

599

 

Telecommunication expense

 

 

173

 

 

 

175

 

 

 

178

 

 

 

171

 

 

 

183

 

FDIC insurance assessment fees

 

 

360

 

 

 

321

 

 

 

363

 

 

 

522

 

 

 

301

 

Other noninterest expense

 

 

1,440

 

 

 

1,294

 

 

 

1,247

 

 

 

1,211

 

 

 

1,184

 

Total noninterest expense

 

$

20,692

 

 

$

21,402

 

 

$

20,514

 

 

$

20,471

 

 

$

19,967

 

 

 

Quarter Ended March 31,

 

 

 

2024

 

 

2023

 

(dollars in thousands)

 

Average

Outstanding

Balance

 

 

Interest

Earned/

Interest

Paid

 

 

Average

Yield/ Rate

 

 

Average

Outstanding

Balance

 

 

Interest

Earned/

Interest

Paid

 

 

Average

Yield/ Rate

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans(1)

 

$

2,299,177

 

 

$

35,491

 

 

 

6.21

%

 

$

2,388,045

 

 

$

32,157

 

 

 

5.46

%

Securities available for sale

 

 

216,298

 

 

 

1,851

 

 

 

3.44

 

 

 

184,572

 

 

 

1,068

 

 

 

2.35

 

Securities held to maturity

 

 

393,394

 

 

 

2,533

 

 

 

2.59

 

 

 

502,760

 

 

 

3,050

 

 

 

2.46

 

Nonmarketable equity securities

 

 

24,438

 

 

 

248

 

 

 

4.08

 

 

 

28,381

 

 

 

419

 

 

 

5.99

 

Interest-bearing deposits in other banks

 

 

45,672

 

 

 

629

 

 

 

5.54

 

 

 

34,986

 

 

 

450

 

 

 

5.22

 

Total interest-earning assets

 

 

2,978,979

 

 

 

40,752

 

 

 

5.50

 

 

 

3,138,744

 

 

 

37,144

 

 

 

4.80

 

Allowance for credit losses

 

 

(30,879

)

 

 

 

 

 

 

 

 

(31,934

)

 

 

 

 

 

 

Noninterest-earning assets

 

 

230,829

 

 

 

 

 

 

 

 

 

218,195

 

 

 

 

 

 

 

Total assets

 

$

3,178,929

 

 

 

 

 

 

 

 

$

3,325,005

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

1,789,119

 

 

$

14,459

 

 

 

3.25

%

 

$

1,624,610

 

 

$

7,655

 

 

 

1.91

%

Advances from FHLB and fed funds purchased

 

 

141,593

 

 

 

1,920

 

 

 

5.45

 

 

 

310,103

 

 

 

3,774

 

 

 

4.94

 

Line of credit

 

 

841

 

 

 

18

 

 

 

8.61

 

 

 

 

 

 

 

 

 

 

Subordinated debt

 

 

45,797

 

 

 

517

 

 

 

4.54

 

 

 

49,164

 

 

 

540

 

 

 

4.45

 

Securities sold under agreements to repurchase

 

 

41,271

 

 

 

251

 

 

 

2.45

 

 

 

10,974

 

 

 

13

 

 

 

0.48

 

Total interest-bearing liabilities

 

 

2,018,621

 

 

 

17,165

 

 

 

3.42

 

 

 

1,994,851

 

 

 

11,982

 

 

 

2.44

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

823,638

 

 

 

 

 

 

 

 

 

1,002,793

 

 

 

 

 

 

 

Accrued interest and other liabilities

 

 

35,469

 

 

 

 

 

 

 

 

 

26,912

 

 

 

 

 

 

 

Total noninterest-bearing liabilities

 

 

859,107

 

 

 

 

 

 

 

 

 

1,029,705

 

 

 

 

 

 

 

Equity

 

 

301,201

 

 

 

 

 

 

 

 

 

300,449

 

 

 

 

 

 

 

Total liabilities and equity

 

$

3,178,929

 

 

 

 

 

 

 

 

$

3,325,005

 

 

 

 

 

 

 

Net interest rate spread(2)

 

 

 

 

 

 

 

 

2.08

%

 

 

 

 

 

 

 

 

2.36

%

Net interest income

 

 

 

 

$

23,587

 

 

 

 

 

 

 

 

$

25,162

 

 

 

 

Net interest margin(3)

 

 

 

 

 

 

 

 

3.18

%

 

 

 

 

 

 

 

 

3.25

%

Net interest margin, fully taxable equivalent(4)

 

 

 

 

 

 

 

 

3.16

%

 

 

 

 

 

 

 

 

3.24

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes average outstanding balances of loans held for sale of $704,000 and $1.7 million for the quarter ended March 31, 2024 and 2023, respectively.

 

(2) Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.

 

(3) Net interest margin is equal to net interest income divided by average interest-earning assets, annualized.

 

(4) Net interest margin on a fully taxable equivalent basis is equal to net interest income adjusted for nontaxable income divided by average interest-earning assets, annualized, using a marginal tax rate of 21%.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NON-GAAP RECONCILING TABLES

Tangible Book Value per Common Share

 

 

As of

 

 

 

2024

 

 

2023

 

(dollars in thousands, except per share data)

 

March 31

 

 

December 31

 

 

September 30

 

 

June 30

 

 

March 31

 

Equity attributable to Guaranty Bancshares, Inc.

 

$

305,371

 

 

$

303,300

 

 

$

296,226

 

 

$

296,862

 

 

$

299,700

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Goodwill

 

 

(32,160

)

 

 

(32,160

)

 

 

(32,160

)

 

 

(32,160

)

 

 

(32,160

)

Core deposit intangible, net

 

 

(1,312

)

 

 

(1,418

)

 

 

(1,524

)

 

 

(1,633

)

 

 

(1,746

)

Total tangible common equity attributable to Guaranty Bancshares, Inc.

 

$

271,899

 

 

$

269,722

 

 

$

262,542

 

 

$

263,069

 

 

$

265,794

 

Common shares outstanding(1)

 

 

11,534,960

 

 

 

11,540,644

 

 

 

11,554,094

 

 

 

11,603,167

 

 

 

11,925,357

 

Book value per common share

 

$

26.47

 

 

$

26.28

 

 

$

25.64

 

 

$

25.58

 

 

$

25.13

 

Tangible book value per common share(1)

 

 

23.57

 

 

 

23.37

 

 

 

22.72

 

 

 

22.67

 

 

 

22.29

 

(1) Excludes the dilutive effect, if any, of shares of common stock issuable upon exercise of outstanding stock options.

Net Unrealized Loss on Securities, Tax Effected, as a Percentage of Total Equity

(dollars in thousands)

 

March 31, 2024

 

Total equity(1)

 

$

305,910

 

Less: net unrealized loss on HTM securities, tax effected

 

 

(25,662

)

Total equity, including net unrealized loss on AFS and HTM securities

 

$

280,248

 

 

 

 

 

Net unrealized loss on AFS securities, tax effected

 

 

16,709

 

Net unrealized loss on HTM securities, tax effected

 

 

25,662

 

Net unrealized loss on AFS and HTM securities, tax effected

 

$

42,371

 

 

 

 

 

Net unrealized loss on securities as % of total equity(1)

 

 

13.9

%

Total equity before impact of unrealized losses

 

$

322,619

 

Net unrealized loss on securities as % of total equity before impact of unrealized losses

 

 

13.1

%

 

 

 

 

Total average assets

 

$

3,178,929

 

Total equity to average assets

 

 

9.6

%

Total equity, adjusted for tax effected net unrealized loss, to average assets

 

 

8.8

%

 

 

 

 

(1) Includes the net unrealized loss on AFS securities, tax effected, of $16,709.

 

 

 

Cost of Total Deposits

 

 

Quarter Ended

 

(dollars in thousands)

 

March 31, 2024

 

 

December 31, 2023

 

 

March 31, 2023

 

Total average interest-bearing deposits

 

$

1,789,119

 

 

$

1,788,863

 

 

$

1,624,610

 

Adjustments:

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

823,638

 

 

 

865,817

 

 

 

1,002,793

 

Total average deposits

 

$

2,612,757

 

 

$

2,654,680

 

 

$

2,627,403

 

 

 

 

 

 

 

 

 

 

 

Total deposit-related interest expense

 

$

14,459

 

 

$

14,311

 

 

$

7,655

 

 

 

 

 

 

 

 

 

 

 

Average cost of interest-bearing deposits

 

 

3.25

%

 

 

3.17

%

 

 

1.91

%

Average cost of total deposits

 

 

2.23

 

 

 

2.14

 

 

 

1.18

 

About Non-GAAP Financial Measures

Certain of the financial measures and ratios we present, including “tangible book value per common share,” “net unrealized loss on securities, tax effected, as a percentage of total equity” and “cost of total deposits” are supplemental measures that are not required by, or are not presented in accordance with, U.S. generally accepted accounting principles (GAAP). We refer to these financial measures and ratios as “non-GAAP financial measures.” We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision making and useful in evaluating period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenditures or assets that we believe are not indicative of our primary business operating results or by presenting certain metrics on a fully taxable equivalent basis. We believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing and comparing past, present and future periods.

These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and you should not rely on non-GAAP financial measures alone as measures of our performance. The non-GAAP financial measures we present may differ from non-GAAP financial measures used by our peers or other companies. We compensate for these limitations by providing the equivalent GAAP measures whenever we present the non-GAAP financial measures and by including a reconciliation of the impact of the components adjusted for in the non-GAAP financial measure so that both measures and the individual components may be considered when analyzing our performance.

A reconciliation of non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables.

Conference Call Information

The Company will hold a conference call to discuss first quarter 2024 financial results on Monday, April 15, 2024 at 10:00 am Central Time. The conference call will be hosted by Ty Abston, Chairman and CEO, and Shalene Jacobson, EVP and CFO. All conference attendees must register before the call at www.gnty.com/earningscall. The conference materials will be available by accessing the Investor Relations page on our website, www.gnty.com. A recording of the conference call will be available by 1:00 pm Central Time the day of the call and remain available through April 31, 2024 on our Investor Relations webpage.

About Guaranty Bancshares, Inc.

Guaranty Bancshares, Inc. is the parent company for Guaranty Bank & Trust, N.A. Guaranty Bank & Trust has 33 banking locations across 26 Texas communities located within the East Texas, Dallas/Fort Worth, Houston and Central Texas regions of the state. As of March 31, 2024, Guaranty Bancshares, Inc. had total assets of $3.1 billion, total loans of $2.3 billion and total deposits of $2.6 billion. Visit www.gnty.com for more information.

Cautionary Statement Regarding Forward-Looking Information

This communication contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our results of operations, financial condition and financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” or the negative version of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Such factors include, without limitation, the “Risk Factors” referenced in our most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q, and other risks and uncertainties listed from time to time in our reports and documents filed with the Securities and Exchange Commission. We can give no assurance that any goal or plan or expectation set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements. The forward-looking statements are made as of the date of this communication, and we do not intend, and assume no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law.

Contacts

Shalene Jacobson

Executive Vice President and Chief Financial Officer

Guaranty Bancshares, Inc.

(888) 572-9881

investors@gnty.com

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