Financial News

The First Bancshares, Inc. Reports Results for First Quarter ended March 31, 2023; Increases Quarterly Dividend 5%

The First Bancshares, Inc. (“FBMS” or “the Company”) (NASDAQ: FBMS), holding company for The First Bank, (www.thefirstbank.com) reported today financial results for the quarter ended March 31, 2023.

Highlights:

  • Effective January 1, 2023, the Company closed its acquisition of Heritage Southeast Bancorporation, Inc., parent company of Heritage Southeast Bank (“Heritage Bank”) based in Jonesboro, Georgia. Heritage Bank increased the Company’s presence in Southern Georgia as well as provided entry into the fast growing markets of Atlanta and Savannah, Georgia and Jacksonville, Florida. Heritage Bank added approximately $1.6 billion of assets and twenty four locations.
  • During the quarter, the Company completed the systems conversion related to the acquisition of Heritage Bank.
  • Net income available to common shareholders totaled $16.3 million for the quarter ended March 31, 2023, representing no change when compared to $16.3 million for the quarter ended December 31, 2022. Several one-time items primarily related to the merger are detailed in the tables located in the appendix of this release.
  • Excluding one-time items detailed in the tables located in the appendix of this release, net earnings available to common shareholders, operating (non-GAAP) increased $9.9 million, or 57.8% to $27.1 million for the quarter ended March 31, 2023 as compared to $17.2 million for the quarter ended December 31, 2022.
  • Total loans, excluding Heritage Bank acquired loans, increased 1.0% for the quarter representing net growth of $36.7 million, or 4.0% on an annualized basis, as compared to the quarter ended December 31, 2022.
  • Net interest margin increased 32 bps to 3.63% for the quarter ended March 31, 2023 from 3.31% for the quarter ended December 31, 2022.
  • Recorded initial purchase accounting adjustments related to the Heritage Bank merger including goodwill of $91.4 million, core deposit intangible of $43.7 million and Current Expected Credit Losses (“CECL”) day one provision for credit losses and unfunded commitments of $10.7 million. Merger related expenses were recorded in the amount of $3.8 million.
  • For additional information, see the investor presentation filed and available under presentations and press releases included in the investor relations section of the Company’s website: www.thefirstbank.com.

M. Ray “Hoppy” Cole, President and Chief Executive Officer, commented, “Our company produced another strong quarter as we enjoy significantly increased operating earnings associated with our two recent acquisitions and the remix of our earning assets away from the bond portfolio into new loans.

“An 18 basis point improvement in our core net interest margin, the realization of additional cost saves associated with the Beach transaction and the closing of the Heritage transaction combined to produce an annualized ROAA of 1.36%, an annualized ROTCE of 20.13% on an efficiency ratio of 53% during the first quarter, giving us an outstanding start for the year.

“Our company continues to operate with a relatively low loan to deposit ratio of 73%, ample liquidity, a well-diversified granular deposit base and a strong capital position. Even with the volatility within the industry and the uncertainty of the economic cycle, we remain optimistic about the tailwinds we enjoy from our recent expansion in terms of operating returns and the new markets we added for additional growth.”

Quarterly Earnings

Net income available to common shareholders totaled $16.3 million for the quarter ended March 31, 2023, representing no change when compared to $16.3 million for the quarter ended December 31, 2022.

Excluding one-time items detailed in the tables included with this press release, net earnings available to common shareholders, operating (non-GAAP) increased $9.9 million, or 57.8%, to $27.1 million for quarter ended March 31, 2023 as compared to $17.2 million for the quarter ended December 31, 2022. The increase in net earnings available to common shareholders resulted in part from the acquisitions of Beach Bank and Heritage Bank.

The Company recorded a provision for credit losses of $11.0 million for the quarter ended March 31, 2023 and $0.7 million for the quarter ended December 31, 2022. The $11.0 million provision in respect of the quarter ended March 31, 2023 included $10.7 million for the CECL day 1 provision for credit losses and unfunded commitments attributable to the acquired Heritage Bank loans.

Earnings Per Share

For the first quarter of 2023, fully diluted earnings per share were $0.52, compared to $0.67 for the fourth quarter of 2022 and $0.81 for the first quarter of 2022. The decrease in fully-diluted earnings per share when compared to the previous quarter was primarily attributable to expenses associated with the acquisitions as well as the additional shares issued for the acquisition of Heritage Bank.

Fully diluted earnings per share, operating (non-GAAP) were $0.86 for the first quarter of 2023 compared to $0.71 for the fourth quarter of 2022 and $0.72 for the first quarter of 2022.

Effective January 1, 2023, the Company issued 6,920,422 shares of its common stock in conjunction with the closing of the acquisition of Heritage Bank. Effective August 1, 2022, the Company issued 3,498,936 shares of its common stock in conjunction with the closing of the acquisition of Beach Bancorp, Inc. (“Beach Bank”).

Balance Sheet

Consolidated assets increased $1.556 billion to $8.017 billion at March 31, 2023 from $6.462 billion at December 31, 2022. The acquired Heritage Bank assets totaled $1.657 billion.

Total loans were $4.970 billion for the quarter ended March 31, 2023, as compared to $3.774 billion for the quarter ended December 31, 2022, and $2.970 billion for the quarter ended March 31, 2022, representing an increase of $1.196 billion, or 31.7%, for the sequential quarter comparison, and an increase of $2.000 billion, or 67.3%, for the prior year quarterly comparison. During January 2023, loans totaling $1.159 billion, net of purchase accounting adjustments, were recorded from the Heritage Bank acquisition. During August 2022, loans totaling $486.5 million, net of purchase accounting adjustments were recorded from the Beach Bank acquisition.

Excluding the acquired Heritage Bank loans, total loans increased $36.7 million, or 1.0% as compared to the quarter ended December 31, 2022, or 4.0% on an annualized basis.

Excluding the acquired Heritage Bank loans and Beach Bank loans, total loans increased $354.2 million, or 11.9% compared to the quarter ended March 31, 2022.

Total deposits were $6.668 billion for the quarter ended March 31, 2023, as compared to $5.494 billion for the quarter ended December 31, 2022, and $5.438 billion for the quarter ended March 31, 2022, representing an increase of $1.174 billion, or 21.4%, for the sequential quarter comparison, and an increase of $1.230 million, or 22.6%, for the prior year quarterly comparison. During January 2023, deposits totaling $1.392 billion, net of purchase accounting adjustments, were acquired in the Heritage Bank acquisition. During August 2022, deposits totaling $490.6 million, net of purchase accounting adjustments, were acquired in the Beach Bank acquisition.

Excluding the deposits acquired of Heritage Bank, deposits decreased $218.8 million, or 3.2% for the prior quarter comparison. Brokered certificate of deposits in the amount of $77.4 million matured during the quarter. Additionally public fund deposits increased $121.9 million during the quarter resulting in approximately $260 million in total deposit runoff during the quarter.

Book value per share increased to $28.58 at March 31, 2023 from $26.92 at December 31, 2022.

Tangible book value per share (non-GAAP) decreased to $17.49 at March 31, 2023 from $17.97 at December 31, 2022. This decrease was the result of increased common shares outstanding, increased goodwill and other intangibles which was partially offset by the change in accumulated other comprehensive income (loss) as well as earnings net of dividends for the quarter. The balance in accumulated other comprehensive income (loss) improved $18.2 million to $130.8 million at March 31, 2023 from $149.0 million at December 31, 2022.

Asset Quality

Nonperforming assets totaled $22.5 million at March 31, 2023, an increase of $4.7 million compared to $17.7 million at December 31, 2022 and a decrease of $5.1 million compared to $27.6 million at March 31, 2022. Nonperforming assets related to the acquisition of Heritage Bank totaled $3.8 million.

Nonaccrual loans totaled $17.3 million, an increase of $4.7 million as compared to December 31, 2022 and a decrease of $7.4 million as compared to March 31, 2022. During the quarter ended September 30, 2022, one large relationship with a balance of $10.2 million was upgraded to accrual status.

The ratio of the allowance for credit losses (ACL) to total loans was 1.06% at March 31, 2023, 1.03% at December 31, 2022 and 1.06% at March 31, 2022. The ratio of annualized net charge-offs (recoveries) to total loans was 0.01% for the quarter ended March 31, 2023 compared to 0.004% for the quarter ended December 31, 2022 and (0.12%) for the quarter ended March 31, 2022.

First Quarter 2023 vs Fourth Quarter 2022 Earnings Comparison

Net income available to common shareholders for the first quarter of 2023 remained flat when compared to $16.3 million for the fourth quarter of 2022.

Excluding one-time items detailed in the tables included with this press release, net earnings available to common shareholders, operating (non-GAAP) increased $9.9 million, or 57.8%, to $27.1 million for quarter ended March 31, 2023 as compared to $17.2 million for the quarter ended December 31, 2022. The increase in net earnings available to common shareholders resulted in part from the acquisitions of Beach Bank and Heritage Bank.

Net interest income for the first quarter of 2023 was $64.9 million as compared to $47.9 million for the fourth quarter of 2022, an increase of $17.0 million. The increase was largely due to the acquisition of Heritage Bank.

First quarter 2023 net interest margin of 3.63% included 21 basis points related to purchase accounting adjustments compared to 3.31% for the fourth quarter in 2022, which included 9 basis points related to purchase accounting adjustments.

Investment securities totaled $1.962 billion, or 24.5% of total assets at March 31, 2023, compared to $1.983 billion, or 30.7% of total assets at December 31, 2022. The average balance of investment securities decreased $51.7 million in sequential-quarter comparison. The average yield on investment securities increased 3 basis points to 2.31% from 2.28% in sequential-quarter comparison. The investment portfolio had a net unrealized loss of $137.6 million at March 31, 2023 as compared to a net unrealized loss of $161.2 million at December 31, 2022.

The average yield on all earning assets increased in sequential-quarter comparison from 4.00% to 4.49%. Interest expense on average interest bearing liabilities increased 25 basis points from 0.99% for the fourth quarter of 2022 to 1.24% for the first quarter of 2023.

Cost of all deposits averaged 72 basis points for the first quarter of 2023 compared to 57 basis points for the fourth quarter of 2022. This increase was a result of rising interest rates and increased competition for deposits.

Non-interest income increased $4.5 million from $8.1 million to $12.6 million in the sequential-quarter comparison, attributable to increases in service charges on deposit accounts of $1.4 million and interchange fee income of $1.4 million.

Non-interest expense for the first quarter of 2023 was $45.7 million compared to $35.0 million for the fourth quarter of 2022, an increase of $10.6 million, largely attributed to the increase in acquisition charges of $2.6 million as well as expenses related to the operations of Beach Bank and Heritage Bank of $7.9 million.

First Quarter 2023 vs. First Quarter 2022 Earnings Comparison

Net income available to common shareholders for the first quarter of 2023 totaled $16.3 million compared to $16.8 million for the first quarter of 2022, a decrease of $0.6 million or 3.3%.

Excluding one-time items detailed in the tables included with this press release, net earnings available to common shareholders, operating (non-GAAP) increased $12.1 million, or 81.0%, to $27.1 million for quarter ended March 31, 2023 as compared to $15.0 million for the quarter ended March 31, 2022.

Net interest income for the first quarter of 2023 was $64.9 million, an increase of $26.3 million or 68.0% when compared to the first quarter of 2022. FTE net interest income (non-GAAP) totaled $65.9 million and $39.5 million for the first quarter of 2023 and 2022, respectively. Purchase accounting adjustments increased $2.7 million for the first quarter comparisons. The increase was largely due to increased interest rates as well as the acquisitions of Beach Bank and Heritage Bank.

First quarter of 2023 net interest margin was 3.63% which included 21 basis points related to purchase accounting adjustments compared to 2.67% for the same quarter in 2022, which included 6 basis points related to purchase accounting adjustments. Excluding the purchase accounting adjustments, the core net interest margin (non-GAAP) increased 74 basis point in prior year quarterly comparison primarily due to an increase in average loans as well as interest rate increases.

Non-interest income increased $1.5 million for the first quarter of 2023 as compared to the first quarter of 2022. This increase was attributable to increases in service charges on deposit accounts and interchange fee income of $2.9 million and partially offset by a decrease of $0.6 million in mortgage income.

First quarter 2023 non-interest expense was $45.7 million, an increase of $17.1 million, or 59.7% as compared to the first quarter of 2022. For the first quarter of 2023, charges related to the ongoing operations of Beach Bank and Heritage Bank totaled $12.7 million.

Investment securities totaled $1.962 billion, or 24.5% of total assets at March 31, 2023, compared to $1.986 billion, or 32.1% of total assets at March 31, 2022. For the first quarter of 2023 compared to the first quarter of 2022, the average balance of investment securities increased $131.0 million. The average yield on investment securities increased 50 basis points to 2.31% from 1.81% in the prior year quarterly comparison. The investment portfolio had a net unrealized loss of $137.6 million at March 31, 2023 as compared to a net unrealized loss of $92.2 million at March 31, 2022.

The average yield on all earnings assets increased 147 basis points in prior year quarter comparison, from 3.02% for the first quarter of 2022 to 4.49% for the first quarter of 2023. Interest expense on average interest bearing liabilities increased 82 basis points from 0.42% for the first quarter of 2022 to 1.24% for the first quarter of 2023.

Cost of all deposits averaged 72 basis points for the first quarter of 2023 compared to 17 basis points for the first quarter of 2022. This increase was a result of rising interest rates and increased competition for deposits.

Declaration of Cash Dividend

The Company announced that its Board of Directors declared a cash dividend of $0.22 per share, a 5% increase over previous quarter, to be paid on its common stock on May 24, 2023 to shareholders of record as of the close of business on May 8, 2023.

Conference Call

The Company will host a conference call for analysts and investors to discuss the Company’s financial results at 10:00 a.m. Central Time on Thursday, April 27, 2023. Investors and analysts may participate by clicking on the Participant Conference Link: https://register.vevent.com/register/BI24f86c11813b4dd9a868c4c810de94bc. An audio archive of the conference call along with the transcript will be available within 24-48 hours after the call and placed in the Investor Relations section of our website.

About The First Bancshares, Inc.

The First Bancshares, Inc., headquartered in Hattiesburg, Mississippi, is the parent company of The First Bank (“The First”). Founded in 1996, The First has operations in Mississippi, Louisiana, Alabama, Florida and Georgia. The Company’s stock is traded on the NASDAQ Global Market under the symbol FBMS. Information is available on the Company’s website: www.thefirstbank.com.

Non-GAAP Financial Measures

Our accounting and reporting policies conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP measures are used by management to supplement the evaluation of our performance. This press release includes pre-tax, pre-provision operating earnings, FTE net interest income, FTE net interest margin, core net interest margin, average tax equivalent yield on investment securities, FTE average yield on all earning assets, total tangible common equity, tangible book value per common share, net earnings available to common shareholders, operating, diluted earnings per share, operating efficiency ratio, operating and certain ratios derived from these non-GAAP financial measures. The Company believes that the non-GAAP financial measures included in this press release allow management and investors to understand and compare results in a more consistent manner for the periods presented in this press release. Non-GAAP financial measures should be considered supplemental and not a substitute for the Company’s results reported in accordance with GAAP for the periods presented, and other bank holding companies may define or calculate these measures differently. These non-GAAP financial measures should not be considered in isolation and do not purport to be an alternative to net income, earnings per share, net interest income, book value, net interest margin, common equity, net earnings available to common shareholders, diluted earnings per share, efficiency ratio, average yield on investment securities, average yield on all earning assets, or other GAAP financial measures as a measure of operating performance. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measure is provided in this press release following the Condensed Consolidated Financial Information (unaudited).

Forward Looking Statements

This news release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

All statements other than statements of historical fact are forward-looking statements. Such statements can generally be identified by such words as “believes,” “anticipates,” “expects,” “may,” “will,” “assumes,” “should,” “predicts,” “could,” “would,” “intends,” “targets,” “estimates,” “projects,” “plans,” “potential,” “positioned” and other similar words and expressions of the future or otherwise regarding the outlook for the Company’s future business and financial performance and/or the performance of the banking industry and economy in general. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risk and uncertainties which may cause the actual results, performance or achievements of the Company to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. Factors that might cause such differences include, but are not limited to: (1) competitive pressures among financial institutions increasing significantly; (2) prevailing, or changes in, economic or political conditions, either nationally or locally, particularly in areas in which the Company conducts operations, including the effects of declines in the real estate market, high unemployment rates, inflationary pressure, elevated interest rates and slowdowns in economic growth, as well as the financial stress on borrowers as a result of the foregoing; (3) interest rate risk, including the effects of rising interest rates; (4) developments in our mortgage banking business, including loan modifications, general demand, and the effects of judicial or regulatory requirements or guidance; (5) changes in applicable laws, rules, or regulations; (6) risks related to the Company’s recently completed and pending acquisitions, including that the anticipated benefits from the recently completed acquisitions are not realized in the time frame anticipated or at all as a result of changes in general economic and market conditions or other unexpected factors or events; (7) changes in management’s plans for the future; (8) credit risk associated with our lending activities; (9) changes in loan demand, real estate values, or competition; (10) changes in accounting principles, policies, or guidelines; (11) adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company’s participation in and execution of government programs related to the COVID-19 pandemic and related variants; (12) higher inflation and its impacts; (13) significant turbulence or disruption in the capital or financial markets and the effect of a fall in stock market prices on our investment securities; (14) potential impacts of the recent adverse developments in the banking industry highlighted by high-profile bank failures, including impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; (15) the effects of war or other conflicts including the impacts relating to or resulting from Russia’s military action in Ukraine; and (16) other general competitive, economic, political, and market factors, including those affecting our business, operations, pricing, products, or services.

These and other factors that could cause results to differ materially from those described in the forward-looking statements, as well as a discussion of the risks and uncertainties that may affect our business, can be found in our Annual Report on Form 10-K and in other filings we make with the SEC, which are available on the SEC’s website, http://www.sec.gov. Undue reliance should not be placed on forward-looking statements. The Company disclaims any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments.

FIRST BANCSHARES, INC and SUBSIDIARIES

Condensed Consolidated Financial Information (unaudited)

(Dollars in thousands except per share data)

EARNINGS DATA

Quarter

Ended

3/31/23

Quarter

Ended

12/31/22

Quarter

Ended

9/30/22

Quarter

Ended

6/30/22

Quarter

Ended

3/31/22

Total Interest Income

$

80,338

 

$

57,923

 

$

53,874

 

$

45,847

 

$

42,741

 

Total Interest Expense

 

15,412

 

 

10,002

 

 

4,726

 

 

3,746

 

 

4,102

 

Net Interest Income

 

64,926

 

 

47,921

 

 

49,148

 

 

42,101

 

 

38,639

 

Net Interest Income excluding PPP Fee Income

 

64,718

 

 

47,899

 

 

48,986

 

 

41,563

 

 

37,643

 

FTE net interest income*

 

65,924

 

 

48,916

 

 

50,122

 

 

43,042

 

 

39,459

 

Provision for credit losses

 

11,000

 

 

705

 

 

4,300

 

 

600

 

 

-

 

Non-interest income

 

12,612

 

 

8,131

 

 

9,022

 

 

8,664

 

 

11,157

 

Non-interest expense

 

45,670

 

 

35,040

 

 

35,903

 

 

30,955

 

 

28,590

 

Earnings before income taxes

 

20,868

 

 

20,307

 

 

17,967

 

 

19,210

 

 

21,206

 

Income tax expense

 

4,597

 

 

4,012

 

 

3,924

 

 

3,457

 

 

4,377

 

Net income available to common shareholders

$

16,271

 

$

16,295

 

$

14,043

 

$

15,753

 

$

16,829

 

 

 

 

 

 

 

 

 

 

 

 

 

PER COMMON SHARE DATA

 

 

 

 

 

Basic earnings per share

$

0.52

 

$

0.68

 

$

0.61

 

$

0.77

 

$

0.81

 

Diluted earnings per share

 

0.52

 

 

0.67

 

 

0.61

 

 

0.76

 

 

0.81

 

Diluted earnings per share, operating*

 

0.86

 

 

0.71

 

 

0.85

 

 

0.80

 

 

0.72

 

Quarterly dividends per share

 

.21

 

 

.20

 

 

.19

 

 

.18

 

 

.17

 

Book value per common share at end of period

 

28.58

 

 

26.92

 

 

25.86

 

 

27.30

 

 

28.82

 

Tangible book value per common share at period end*

 

17.49

 

 

17.97

 

 

16.93

 

 

18.32

 

 

19.79

 

Market price at end of period

 

25.83

 

 

32.01

 

 

29.87

 

 

28.60

 

 

33.66

 

Shares outstanding at period end

 

31,364,973

 

 

24,025,762

 

 

24,028,120

 

 

20,529,124

 

 

20,484,830

 

Weighted average shares outstanding:

 

 

 

 

 

Basic

 

31,309,458

 

 

24,027,189

 

 

22,861,795

 

 

20,507,451

 

 

20,697,946

 

Diluted

 

31,541,213

 

 

24,168,544

 

 

22,979,529

 

 

20,615,928

 

 

20,846,997

 

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE BALANCE SHEET DATA

 

 

 

 

 

Total assets

$

8,003,254

 

$

6,446,521

 

$

6,372,872

 

$

6,112,241

 

$

6,202,669

 

Loans and leases

 

4,975,663

 

 

3,749,561

 

 

3,492,110

 

 

3,013,228

 

 

2,945,877

 

Total deposits

 

6,816,473

 

 

5,515,713

 

 

5,503,040

 

 

5,347,415

 

 

5,361,480

 

Total common equity

 

868,995

 

 

617,049

 

 

630,744

 

 

593,410

 

 

666,561

 

Total tangible common equity*

 

538,903

 

 

408,365

 

 

424,873

 

 

408,855

 

 

480,922

 

 

 

 

 

 

 

SELECTED RATIOS

 

 

 

 

 

Annualized return on avg assets (ROA)

 

0.81

%

 

1.01

%

 

0.88

%

 

1.03

%

 

1.09

%

Annualized return on avg assets, operating*

 

1.36

%

 

1.07

%

 

1.23

%

 

1.08

%

 

0.97

%

Annualized pre-tax, pre-provision, operating*

 

1.78

%

 

1.38

%

 

1.63

%

 

1.36

%

 

1.24

%

Annualized return on avg common equity, operating*

 

12.48

%

 

11.14

%

 

12.46

%

 

11.12

%

 

8.99

%

Annualized return on avg tangible common equity, oper*

 

20.13

%

 

16.83

%

 

18.49

%

 

16.14

%

 

12.46

%

Average loans to average deposits

 

72.99

%

 

67.98

%

 

63.46

%

 

56.35

%

 

54.95

%

FTE Net Interest Margin*

 

3.69

%

 

3.37

%

 

3.50

%

 

3.09

%

 

2.78

%

Efficiency Ratio

 

58.15

%

 

61.42

%

 

60.70

%

 

59.87

%

 

56.48

%

Efficiency Ratio, operating*

 

53.32

%

 

59.34

%

 

54.55

%

 

57.66

%

 

58.37

%

*See reconciliation of Non-GAAP financial measures

 

 

 

 

 

 

CREDIT QUALITY

 

 

 

 

 

Allowance for credit losses (ACL) as a % of total loans

 

1.06

%

 

1.03

%

 

1.03

%

 

1.04

%

 

1.06

%

Nonperforming assets to tangible equity + ACL

 

3.73

%

 

3.76

%

 

6.01

%

 

6.41

%

 

6.31

%

Nonperforming assets to total loans + OREO

 

0.45

%

 

0.47

%

 

0.72

%

 

0.84

%

 

0.93

%

Annualized QTD net charge-offs (recoveries) to total loans

 

0.01

%

 

0.004

%

 

(0.04

%)

 

(0.04

%)

 

(0.12

%)

 

 

 

 

 

 

FIRST BANCSHARES, INC and SUBSIDIARIES

Condensed Consolidated Financial Information (unaudited)

(in thousands)

BALANCE SHEET

Mar 31,

2023

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Assets

 

 

 

 

 

Cash and cash equivalents

$

333,491

 

$

145,315

 

$

163,841

 

$

356,771

 

$

802,613

 

Securities available for sale

 

1,249,791

 

 

1,257,101

 

 

1,379,410

 

 

1,489,247

 

 

1,591,677

 

Securities held to maturity

 

678,161

 

 

691,484

 

 

593,553

 

 

593,154

 

 

372,062

 

Other investments

 

34,423

 

 

33,944

 

 

31,060

 

 

22,588

 

 

22,226

 

Total investment securities

 

1,962,375

 

 

1,982,529

 

 

2,004,023

 

 

2,104,989

 

 

1,985,965

 

Loans held for sale

 

4,073

 

 

4,443

 

 

2,225

 

 

6,703

 

 

8,213

 

Total loans

 

4,969,776

 

 

3,774,157

 

 

3,719,388

 

 

3,124,924

 

 

2,970,246

 

Allowance for credit losses

 

(52,450

)

 

(38,917

)

 

(38,356

)

 

(32,400

)

 

(31,620

)

Loans, net

 

4,917,326

 

 

3,735,240

 

 

3,681,032

 

 

3,092,524

 

 

2,938,626

 

Premises and equipment

 

186,688

 

 

153,068

 

 

150,480

 

 

132,724

 

 

131,813

 

Other Real Estate Owned

 

5,066

 

 

4,832

 

 

10,328

 

 

1,985

 

 

2,835

 

Goodwill and other intangibles

 

347,777

 

 

214,890

 

 

214,708

 

 

184,323

 

 

185,104

 

Other assets

 

260,520

 

 

221,400

 

 

228,211

 

 

157,406

 

 

140,926

 

Total assets

$

8,017,316

 

$

6,461,717

 

$

6,454,848

 

$

6,037,425

 

$

6,196,095

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

Non-interest bearing deposits

$

2,082,441

 

$

1,630,203

 

$

1,770,848

 

$

1,658,288

 

$

1,648,451

 

Interest-bearing deposits

 

4,585,515

 

 

3,864,201

 

 

3,780,450

 

 

3,647,909

 

 

3,789,333

 

Total deposits

 

6,667,956

 

 

5,494,404

 

 

5,551,298

 

 

5,306,197

 

 

5,437,784

 

Borrowings

 

250,000

 

 

130,100

 

 

90,000

 

 

-

 

 

-

 

Subordinated debentures

 

154,127

 

 

145,027

 

 

144,952

 

 

144,876

 

 

144,801

 

Other liabilities

 

48,806

 

 

45,523

 

 

47,127

 

 

25,900

 

 

23,117

 

Total liabilities

 

7,120,889

 

 

5,815,054

 

 

5,833,377

 

 

5,476,973

 

 

5,605,655

 

Total shareholders’ equity

 

896,427

 

 

646,663

 

 

621,471

 

 

560,452

 

 

590,440

 

Total liabilities and shareholders’ equity

$

8,017,316

 

$

6,461,717

 

$

6,454,848

 

$

6,037,425

 

$

6,196,095

 

FIRST BANCSHARES, INC and SUBSIDIARIES

Condensed Consolidated Financial Information (unaudited)

(in thousands except per share data)

EARNINGS STATEMENT

Three Months Ended

3/31/23

12/31/22

9/30/22

6/30/22

3/31/22

Interest Income:

 

 

 

 

 

Loans, including fees

$

64,264

$

45,583

 

$

41,456

 

$

34,058

 

$

33,354

 

Investment securities

 

11,707

 

11,251

 

 

11,598

 

 

11,152

 

 

8,574

 

Accretion of purchase accounting adjustments

 

3,469

 

1,086

 

 

818

 

 

605

 

 

800

 

Other interest income

 

898

 

3

 

 

2

 

 

32

 

 

13

 

Total interest income

 

80,338

 

57,923

 

 

53,874

 

 

45,847

 

 

42,741

 

Interest Expense:

 

 

 

 

 

Deposits

 

12,183

 

7,206

 

 

2,863

 

 

1,923

 

 

2,302

 

Borrowings

 

959

 

1,015

 

 

92

 

 

-

 

 

-

 

Subordinated debentures

 

2,176

 

1,946

 

 

1,886

 

 

1,841

 

 

1,819

 

Accretion of purchase accounting adjustments

 

94

 

(165

)

 

(115

)

 

(18

)

 

(19

)

Total interest expense

 

15,412

 

10,002

 

 

4,726

 

 

3,746

 

 

4,102

 

Net interest income

 

64,926

 

47,921

 

 

49,148

 

 

42,101

 

 

38,639

 

Provision for credit losses

 

11,000

 

705

 

 

4,300

 

 

600

 

 

-

 

Net interest income after provision for credit losses

 

53,926

 

47,216

 

 

44,848

 

 

41,501

 

 

38,639

 

 

 

 

 

 

 

Non-interest Income:

 

 

 

 

 

Service charges on deposit accounts

 

3,657

 

2,277

 

 

2,219

 

 

2,038

 

 

2,040

 

Mortgage Income

 

633

 

625

 

 

1,221

 

 

1,227

 

 

1,230

 

Interchange Fee Income

 

4,498

 

3,093

 

 

3,310

 

 

3,102

 

 

3,197

 

Gain (Loss) on securities, net

 

-

 

-

 

 

1

 

 

(80

)

 

(3

)

Financial Assistance Award/Bank Enterprise Award/RRP Grant

 

-

 

-

 

 

-

 

 

171

 

 

702

 

Bargain Purchase Gain and (Loss) on Sale of Land

 

-

 

-

 

 

-

 

 

165

 

 

-

 

BOLI income from death proceeds

 

-

 

-

 

 

-

 

 

-

 

 

1,630

 

Other charges and fees

 

3,824

 

2,136

 

 

2,271

 

 

2,041

 

 

2,361

 

Total non-interest income

 

12,612

 

8,131

 

 

9,022

 

 

8,664

 

 

11,157

 

 

 

 

 

 

 

Non-interest expense:

 

 

 

 

 

Salaries and employee benefits

 

23,572

 

19,934

 

 

19,099

 

 

17,237

 

 

16,799

 

Occupancy expense

 

5,296

 

4,305

 

 

3,826

 

 

3,828

 

 

3,876

 

FDIC/OCC premiums

 

670

 

514

 

 

496

 

 

546

 

 

566

 

Marketing

 

158

 

135

 

 

50

 

 

122

 

 

86

 

Amortization of core deposit intangibles

 

2,402

 

1,309

 

 

1,227

 

 

1,064

 

 

1,064

 

Other professional services

 

1,068

 

971

 

 

1,256

 

 

768

 

 

563

 

Acquisition and charter conversion charges

 

3,793

 

1,190

 

 

3,640

 

 

1,172

 

 

408

 

Other non-interest expense

 

8,711

 

6,682

 

 

6,309

 

 

6,218

 

 

5,228

 

Total Non-interest expense

 

45,670

 

35,040

 

 

35,903

 

 

30,955

 

 

28,590

 

Earnings before income taxes

 

20,868

 

20,307

 

 

17,967

 

 

19,210

 

 

21,206

 

Income tax expense

 

4,597

 

4,012

 

 

3,924

 

 

3,457

 

 

4,377

 

Net income available to common shareholders

$

16,271

$

16,295

 

$

14,043

 

$

15,753

 

$

16,829

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share

$

0.52

$

0.67

 

$

0.61

 

$

0.76

 

$

0.81

 

Diluted earnings per common share, operating*

$

0.86

$

0.71

 

$

0.85

 

$

0.80

 

$

0.72

 

*See reconciliation of Non-GAAP financial measures

FIRST BANCSHARES, INC and SUBSIDIARIES

Condensed Consolidated Financial Information (unaudited)

(in thousands except per share data)

EARNINGS STATEMENT

Quarter to Date

 

 

2023

 

 

 

2022

 

 

Interest Income:

 

 

 

 

 

 

Loans, including fees

 

$

64,056

 

 

$

32,358

 

 

PPP loan fee income

 

 

208

 

 

 

996

 

 

Investment securities

 

 

11,707

 

 

 

8,574

 

 

Accretion of purchase accounting adjustments

 

 

3,469

 

 

 

800

 

 

Other interest income

 

898

 

 

13

 

Total interest income

 

 

80,338

 

 

 

42,741

 

 

Interest Expense:

 

 

 

 

 

 

Deposits

 

 

12,183

 

 

 

2,302

 

 

Borrowings

 

 

959

 

 

 

-

 

 

Subordinated debentures

 

 

2,176

 

 

 

1,819

 

 

Amortization of purchase accounting adjustments

 

94

 

 

(19

)

Total interest expense

 

15,412

 

 

4,102

 

Net interest income

 

 

64,926

 

 

 

38,639

 

 

Provision for credit losses

 

11,000

 

 

-

 

Net interest income after provision for credit losses

 

 

53,926

 

 

 

38,639

 

 

 

 

 

 

 

 

 

Non-interest Income:

 

 

 

 

 

 

Service charges on deposit accounts

 

 

3,657

 

 

 

2,040

 

 

Mortgage Income

 

 

633

 

 

 

1,230

 

 

Interchange Fee Income

 

 

4,498

 

 

 

3,197

 

 

Gain (loss) on securities, net

 

 

-

 

 

 

(3

)

 

Financial Assistance Award/Bank Enterprise Award/RRP Grant

 

 

-

 

 

 

702

 

 

Bargain Purchase Gain and Loss on Sale of Fixed Assets

 

-

 

 

 

-

 

BOLI income from death proceeds

 

-

 

 

 

1,630

 

Other charges and fees

 

3,824

 

 

2,361

 

Total non-interest income

 

 

12,612

 

 

 

11,157

 

 

 

 

 

 

 

 

 

Non-interest expense:

 

 

 

 

 

 

Salaries and employee benefits

 

 

23,572

 

 

 

16,799

 

 

Occupancy expense

 

 

5,296

 

 

 

3,876

 

 

FDIC/OCC premiums

 

 

670

 

 

 

566

 

 

Marketing

 

 

158

 

 

 

86

 

 

Amortization of core deposit intangibles

 

 

2,402

 

 

 

1,064

 

 

Other professional services

 

 

1,068

 

 

 

563

 

 

Acquisition & charter conversion charges

 

 

3,793

 

 

 

408

 

 

Other non-interest expense

 

8,711

 

 

5,228

 

Total Non-interest expense

 

45,670

 

 

28,590

 

Earnings before income taxes

 

 

20,868

 

 

 

21,206

 

 

Income tax expense

 

4,597

 

 

4,377

 

Net income available to common shareholders

$

16,271

 

$

16,829

 

 

 

 

 

 

 

Diluted earnings per common share

$

0.52

 

$

0.81

 

Diluted earnings per common share, operating*

$

0.86

 

$

0.72

 

*See reconciliation of Non-GAAP financial measures

 

 

 
FIRST BANCSHARES, INC and SUBSIDIARIES

Condensed Consolidated Financial Information (unaudited)

(Dollars in thousands)

COMPOSITION OF LOANS

Mar 31,

2023

Percent

of Total

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Percent

of Total

Commercial, financial and agricultural

$

750,371

 

15.1

%

$

506,907

 

$

489,225

 

$

379,363

 

$

364,702

 

12.2

%

Real estate – construction

 

691,285

 

13.9

%

 

475,956

 

 

481,100

 

 

429,946

 

 

387,290

 

13.0

%

Real estate – commercial

 

2,181,384

 

43.9

%

 

1,626,066

 

 

1,595,944

 

 

1,319,821

 

 

1,249,203

 

41.9

%

Real estate – residential

 

1,262,244

 

25.4

%

 

1,094,204

 

 

1,082,488

 

 

932,268

 

 

911,568

 

30.6

%

Lease Financing Receivable

 

2,056

 

0.0

%

 

2,118

 

 

1,907

 

 

2,283

 

 

2,409

 

0.1

%

Obligations of States & subdivisions

 

31,652

 

0.6

%

 

26,143

 

 

25,757

 

 

20,784

 

 

15,842

 

0.5

%

Consumer

 

50,784

 

1.0

%

 

42,763

 

 

42,967

 

 

40,459

 

 

39,233

 

1.3

%

Loans held for sale

 

4,073

 

0.1

%

 

4,443

 

 

2,225

 

 

6,703

 

 

8,213

 

0.4

%

Total loans

$

4,973,849

 

100

%

$

3,778,600

 

$

3,721,613

 

$

3,131,627

 

$

2,978,460

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COMPOSITION OF DEPOSITS

Mar 31,

2023

Percent

of Total

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Percent of Total

Non-interest bearing

$

2,082,441

 

31.2

%

$

1,630,203

 

$

1,770,848

 

$

1,658,288

 

$

1,648,451

 

30.3

%

NOW and other

 

2,095,599

 

31.4

%

 

1,769,699

 

 

1,786,213

 

 

1,790,980

 

 

1,885,145

 

34.7

%

Money Market/Savings

 

1,678,609

 

25.2

%

 

1,368,108

 

 

1,423,953

 

 

1,326,245

 

 

1,337,419

 

24.6

%

Time Deposits of less than $250,000

 

562,240

 

8.4

%

 

590,564

 

 

418,931

 

 

400,354

 

 

424,183

 

7.8

%

Time Deposits of $250,000 or more

 

249,067

 

3.8

%

 

135,830

 

 

151,353

 

 

130,330

 

 

142,539

 

2.6

%

Total Deposits

$

6,667,956

 

100

%

$

5,494,404

 

$

5,551,298

 

$

5,306,197

 

$

5,437,737

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSET QUALITY DATA

Mar 31,

2023

 

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

 

Nonaccrual loans

$

17,312

 

 

$

12,591

 

$

15,844

 

$

23,678

 

$

24,736

 

 

Loans past due 90 days and over

 

73

 

 

 

289

 

 

571

 

 

527

 

 

-

 

 

Total nonperforming loans

 

17,385

 

 

 

12,880

 

 

16,415

 

 

24,205

 

 

24,736

 

 

Other real estate owned

 

5,066

 

 

 

4,832

 

 

10,328

 

 

1,985

 

 

2,834

 

 

Total nonperforming assets

$

22,451

 

$

17,712

 

$

26,743

 

$

26,190

 

$

27,570

 

 

 

 

 

 

 

 

 

 

Nonperforming assets to total assets

 

0.28

%

 

 

0.27

%

 

0.41

%

 

0.43

%

 

0.44

%

 

Nonperforming assets to total loans + OREO

 

0.45

%

 

 

0.47

%

 

0.72

%

 

0.84

%

 

0.93

%

 

ACL to nonperforming loans

 

301.70

%

 

 

302.15

%

 

233.66

%

 

133.86

%

 

127.83

%

 

ACL to total loans

 

1.06

%

 

 

1.03

%

 

1.03

%

 

1.04

%

 

1.06

%

 

 

 

 

 

 

 

 

 

Qtr-to-date net charge-offs (recoveries)

$

142

 

 

$

39

 

$

(353

)

$

(329

)

$

(879

)

 

Annualized QTD net chg-offs (recs) to loans

 

0.01

%

 

 

0.004

%

 

(0.04

%)

 

(0.04

%)

 

(0.12

%)

 

FIRST BANCSHARES, INC and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited)
(dollars in thousands)
 
Yield Three Months Ended Three Months Ended Three Months Ended Three Months Ended Three Months Ended
Analysis March 31, 2023 December 31, 2022 September 30, 2022 June 30, 2022 March 31, 2022
Tax Tax Tax Tax Tax
Avg Equivalent Yield/ Avg Equivalent Yield/ Avg Equivalent Yield/ Avg Equivalent Yield/ Avg Equivalent Yield/
Balance interest Rate Balance interest Rate Balance interest Rate Balance interest Rate Balance interest Rate
 
Taxable securities

$

1,565,623

$

8,758

2.24

%

$

1,522,953

$

8,312

2.18

%

$

1,612,066

$

8,723

2.16

%

$

1,634,679

$

8,372

2.05

%

$

1,413,523

$

6,152

1.74

%

Tax-exempt
securities

 

462,718

 

3,946

3.41

%

 

453,651

 

3,934

3.47

%

 

479,168

 

3,849

3.21

%

 

492,405

 

3,721

3.02

%

 

483,780

 

3,242

2.68

%

Total investment
securities

 

2,028,341

 

12,704

2.51

%

 

1,976,604

 

12,246

2.48

%

 

2,091,234

 

12,572

2.40

%

 

2,127,084

 

12,093

2.27

%

 

1,897,303

 

9,394

1.98

%

in other banks

 

146,663

 

898

2.45

%

 

72,910

 

3

0.02

%

 

143,867

 

2

0.01

%

 

432,851

 

32

0.03

%

 

825,877

 

13

0.01

%

Loans

 

4,975,663

 

67,734

5.45

%

 

3,749,561

 

46,670

4.98

%

 

3,492,110

 

42,274

4.84

%

 

3,013,228

 

34,663

4.60

%

 

2,945,877

 

34,154

4.64

%

Total Interest
earning assets

 

7,150,667

 

81,336

4.55

%

 

5,799,075

 

58,919

4.06

%

 

5,727,211

 

54,848

3.83

%

 

5,573,163

 

46,788

3.36

%

 

5,669,057

 

43,561

3.07

%

Other assets

 

852,587

 

647,446

 

645,661

 

539,078

 

533,612

Total assets

$

8,003,254

$

6,446,521

$

6,372,872

$

6,112,241

$

6,202,669

 
Interest-bearing
liabilities:
Deposits

$

4,738,076

$

12,277

1.04

%

$

3,801,632

$

7,042

0.74

%

$

3,777,059

$

2,748

0.29

%

$

3,706,711

$

1,905

0.21

%

$

3,786,808

$

2,283

0.24

%

Borrowed Funds

 

77,098

 

959

4.98

%

 

108,881

 

1,015

3.73

%

 

13,261

 

92

0.00

%

 

-

 

-

 

-

 

-

0.00

%

Subordinated
debentures

 

155,084

 

2,176

5.61

%

 

144,985

 

1,946

5.37

%

 

144,910

 

1,886

5.21

%

 

144,834

 

1,841

5.08

%

 

144,759

 

1,819

5.03

%

Total interest
bearing liabilities

 

4,970,258

 

15,412

1.24

%

 

4,055,498

 

10,002

0.99

%

 

3,935,230

 

4,726

0.48

%

 

3,851,545

 

3,746

0.39

%

 

3,931,567

 

4,102

0.42

%

Other liabilities

 

2,164,001

 

1,773,974

 

1,806,898

 

1,667,286

 

1,604,541

Shareholders' equity

 

868,995

 

617,049

 

630,744

 

593,410

 

666,561

Total liabilities and
shareholders'
equity

$

8,003,254

$

6,446,521

$

6,372,872

$

6,112,241

$

6,202,669

 
Net interest
income (FTE)*

$

65,924

3.31

%

$

48,917

3.08

%

$

50,122

3.35

%

$

43,042

2.97

%

$

39,459

2.66

%

 
Net interest margin (FTE)*

3.69

%

3.37

%

3.50

%

3.09

%

2.78

%

 
Core net interest
margin*

3.47

%

3.29

%

3.44

%

3.04

%

2.73

%

 
*See reconciliation for Non-GAAP financial measures
FIRST BANCSHARES, INC and SUBSIDIARIES

Reconciliation of Non-GAAP Financial Measures (unaudited)

(in thousands except per share data)

Three Months Ended

 

Per Common Share Data

Mar 31,

2023

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Book value per common share

$

28.58

 

$

26.92

 

$

25.86

 

$

27.30

 

$

28.82

 

Effect of intangible assets per share

 

11.09

 

 

8.95

 

 

8.93

 

 

8.98

 

 

9.03

 

Tangible book value per common share

$

17.49

 

$

17.97

 

$

16.93

 

$

18.32

 

$

19.79

 

 

Diluted earnings per share

$

0.52

 

$

0.68

 

$

0.61

 

$

0.76

 

$

0.81

 

Effect of acquisition and charter conversion charges

 

0.11

 

 

0.05

 

 

0.16

 

 

0.05

 

 

0.02

 

Tax on acquisition and charter conversion charges

 

(0.02

)

 

(0.02

)

 

(0.05

)

 

(0.01

)

 

-

 

Initial provision for acquired loans

 

0.34

 

 

-

 

 

0.17

 

 

-

 

 

-

 

Tax on initial provision for acquired loans

 

(0.09

)

 

-

 

 

(0.04

)

 

-

 

 

-

 

Effect of bargain purchase gain and loss on sale of fixed assets

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Tax on bargain purchase gain and loss on sale of fixed assets

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Effect of Treasury awards

 

-

 

 

-

 

 

-

 

 

-

 

 

(0.03

)

BOLI income from death proceeds

 

-

 

 

-

 

 

-

 

 

-

 

 

(0.08

)

Diluted earnings per share, operating

$

0.86

 

$

0.71

 

$

0.85

 

$

0.80

 

$

0.72

 

 

Year to Date

 

 

2023

 

 

 

2022

 

 

Diluted earnings per share

 

$

0.52

 

 

$

0.81

 

 

Effect of acquisition and charter conversion charges

 

 

0.11

 

 

 

0.02

 

 

Tax on acquisition and charter conversion charges

 

 

(0.02

)

 

 

-

 

 

Effect of bargain purchase gain and loss on sale of fixed assets

 

 

-

 

 

 

-

 

 

Tax on loss on sale of fixed assets

 

 

-

 

 

 

-

 

 

Effect of Treasury awards

 

 

-

 

 

 

(0.03

)

 

Tax on Treasury awards

 

 

-

 

 

 

 

BOLI income from death proceeds

 

 

-

 

 

 

(0.08

)

 

Effect on Contributions related to Treasury awards

 

 

-

 

 

 

-

 

 

Tax on Contributions related to Treasury awards

 

 

-

 

 

-

 

 

Initial provision for acquired loans

 

 

0.34

 

 

-

 

 

Tax on initial provision for acquired loans

 

 

(0.09

)

 

-

 

 

Diluted earnings per share, operating

 

$

0.86

 

$

0.72

 

 

 

Year to Date

 

 

2023

 

 

 

2022

 

 

Net income available to common shareholders

 

$

16,271

 

 

$

16,829

 

 

Acquisition and charter conversion charges

 

 

3,793

 

 

 

408

 

 

Tax on acquisition and charter conversion charges

 

 

(960

)

 

 

(103

)

 

Bargain purchase gain and loss on sale of fixed assets

 

 

-

 

 

 

-

 

 

Tax on bargain purchase gain and loss on sale of fixed assets

 

 

-

 

 

 

-

 

 

Treasury awards

 

 

-

 

 

 

(702

)

 

Tax on Treasury awards

 

 

-

 

 

 

178

 

 

BOLI income from death proceeds

 

 

-

 

 

 

(1,630

)

 

Contributions related to Treasury awards

 

 

-

 

 

 

-

 

 

Tax on Contributions related to Treasury awards

 

 

-

 

 

-

 

 

Initial provision for acquired loans

 

 

10,727

 

 

-

 

 

Tax on initial provision for acquired loans

 

 

(2,714

)

 

-

 

 

Net earnings available to common shareholders, operating

 

$

27,117

 

$

14,980

 

 

Three Months Ended

Average Balance Sheet Data

Mar 31,

2023

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Total average assets

A

$

8,003,254

 

$

6,446,521

 

$

6,372,872

 

$

6,112,241

 

$

6,202,669

 

Total average earning assets

B

 

7,150,667

 

$

5,799,075

 

$

5,727,211

 

$

5,573,163

 

$

5,669,057

 

 

 

 

 

 

 

Common Equity

C

$

868,995

 

$

617,049

 

$

630,744

 

$

593,410

 

$

666,561

 

Less intangible assets

 

330,092

 

 

208,684

 

 

205,871

 

 

184,555

 

 

185,639

 

Total Tangible common equity

D

$

538,903

 

$

408,365

 

$

424,873

 

$

408,855

 

$

480,922

 

 

 

 

 

 

Three Months Ended

Net Interest Income Fully Tax Equivalent

Mar 31,

2023

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Net interest income

E

$

64,926

 

$

47,921

 

$

49,148

 

$

42,101

 

$

38,639

 

Tax-exempt investment income

 

(2,948

)

 

(2,939

)

 

(2,875

)

 

(2,780

)

 

(2,422

)

Taxable investment income

 

3,946

 

 

3,934

 

 

3,849

 

 

3,721

 

 

3,242

 

Net Interest Income Fully Tax Equivalent

F

$

65,924

 

$

48,916

 

$

50,122

 

$

43,042

 

$

39,459

 

 

 

 

 

 

 

Annualized Net Interest Margin

E/B

 

3.63

%

 

3.31

%

 

3.43

%

 

3.02

%

 

2.73

%

Annualized Net Interest Margin, Fully Tax Equivalent

F/B

 

3.69

%

 

3.37

%

 

3.50

%

 

3.09

%

 

2.78

%

 

 

 

 

 

 

Total Interest Income, Fully Tax Equivalent

 

 

 

 

 

Total Interest Income

R

$

80,338

 

$

57,923

 

$

53,874

 

$

45,847

 

$

42,741

 

Tax-exempt investment income

 

(2,948

)

 

(2,939

)

 

(2,875

)

 

(2,780

)

 

(2,422

)

Taxable investment income

 

3,946

 

 

3,934

 

 

3,849

 

 

3,721

 

 

3,242

 

Total Interest Income, Fully Tax Equivalent

G

$

81,336

 

$

58,918

 

$

54,848

 

$

46,788

 

$

43,561

 

 

 

 

 

 

 

Yield on Average Earning Assets

R/B

 

4.49

%

 

4.00

%

 

3.76

%

 

3.29

%

 

3.02

%

Yield on Average Earning Assets, Fully Tax Equivalent

G/B

 

4.55

%

 

4.06

%

 

3.83

%

 

3.36

%

 

3.07

%

 

 

 

 

 

 

Interest Income Investment Securities, Fully Tax Equivalent

 

 

 

 

 

Interest Income Investment Securities

S

$

11,706

 

$

11,251

 

$

11,598

 

$

11,152

 

$

8,574

 

Tax-exempt investment income

 

(2,948

)

 

(2,939

)

 

(2,875

)

 

(2,780

)

 

(2,422

)

Taxable investment Income

 

3,946

 

 

3,934

 

 

3,849

 

 

3,721

 

 

3,242

 

Interest Income Investment Securities, Fully Tax Equivalent

H

$

12,704

 

$

12,246

 

$

12,572

 

$

12,093

 

$

9,394

 

 

 

 

 

 

Average Investment Securities

I

$

2,028,341

 

$

1,976,604

 

$

2,091,234

 

$

2,127,084

 

$

1,897,303

 

 

 

 

 

 

Yield on Investment Securities

S/I

 

2.31

%

 

2.28

%

 

2.22

%

 

2.10

%

 

1.81

%

Yield on Investment Securities, Fully Tax Equivalent

H/I

 

2.51

%

 

2.48

%

 

2.40

%

 

2.27

%

 

1.98

%

 

Three Months Ended

Core Net Interest Margin

Mar 31,

2023

Dec

31, 2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Net interest income (FTE)

$

65,924

 

$

48,916

 

$

50,122

 

$

43,042

 

$

39,459

 

Less purchase accounting adjustments

 

3,469

 

 

1,086

 

 

818

 

 

605

 

 

800

 

Net interest income, net of purchase accounting adj

J

$

62,455

 

$

47,830

 

$

49,304

 

$

42,437

 

$

38,659

 

 

 

 

 

 

 

Total average earning assets

$

7,150,667

 

$

5,799,075

 

$

5,727,211

 

$

5,573,163

 

$

5,669,057

 

Add average balance of loan valuation discount

 

42,945

 

 

10,928

 

 

2,681

 

 

3,085

 

 

3,836

 

Avg earning assets, excluding loan valuation discount

K

$

7,193,612

 

$

5,810,003

 

$

5,729,892

 

$

5,576,248

 

$

5,672,893

 

 

 

 

 

 

 

Core net interest margin

J/K

 

3.47

%

 

3.29

%

 

3.44

%

 

3.04

%

 

2.73

%

 

 

 

 

 

Three Months Ended

Efficiency Ratio

Mar 31,

2023

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Operating Expense

 

 

 

 

 

Total non-interest expense

$

45,670

 

$

35,040

 

$

35,903

 

$

30,955

 

$

28,590

 

Pre-tax non-operating expenses

 

(3,793

)

 

(1,190

)

 

(3,641

)

 

(1,337

)

 

(408

)

Adjusted Operating Expense

L

$

41,877

 

$

33,850

 

$

32,262

 

$

29,618

 

$

28,182

 

 

 

 

 

 

 

Operating Revenue

 

 

 

 

 

Net interest income, FTE

$

65,924

 

$

48,916

 

$

50,122

 

$

43,042

 

$

39,459

 

Total non-interest income

 

12,612

 

 

8,131

 

 

9,022

 

 

8,664

 

 

11,157

 

Pre-tax non-operating items

 

-

 

 

-

 

 

-

 

 

(336

)

 

(2,331

)

Adjusted Operating Revenue

M

$

78,536

 

$

57,047

 

$

59,144

 

$

51,370

 

$

48,285

 

 

 

 

 

 

 

Efficiency Ratio, operating

L/M

 

53.32

%

 

59.34

%

 

54.55

%

 

57.66

%

 

58.37

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

Return Ratios

Mar 31,

2023

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Net income available to common shareholders

N

$

16,271

 

$

16,295

 

$

14,043

 

$

15,753

 

$

16,829

 

Acquisition and charter conversion charges

 

3,793

 

 

1,190

 

 

3,641

 

 

1,172

 

 

408

 

Tax on acquisition and charter conversion charges

 

(960

)

 

(301

)

 

(920

)

 

(296

)

 

(103

)

Initial provision for acquired loans

 

10,727

 

 

-

 

 

3,855

 

 

 

Tax on initial provision for acquired loans

 

(2,714

)

 

-

 

 

(976

)

 

 

Bargain purchase gain and loss on sale of fixed assets

 

-

 

 

-

 

 

-

 

 

(165

)

 

-

 

Tax on bargain purchase gain and loss on sale of fixed assets

 

-

 

 

-

 

 

-

 

 

41

 

 

-

 

Treasury awards

 

-

 

 

-

 

 

-

 

 

(171

)

 

(702

)

Tax on Treasury awards

 

-

 

 

-

 

 

-

 

 

43

 

 

178

 

Charitable contributions related to Treasury awards

 

-

 

 

-

 

 

-

 

 

165

 

 

-

 

Tax on charitable contributions related to Treasury awards

 

-

 

 

-

 

 

-

 

 

(42

)

 

-

 

BOLI income from death proceeds

 

-

 

 

-

 

 

-

 

 

-

 

 

(1,630

)

Net earnings available to common shareholders, operating

O

$

27,117

 

$

17,184

 

$

19,643

 

$

16,500

 

$

14,980

 

 

Three Months Ended

Pre-Tax Pre-Provision Operating Earnings

Mar 31,

2023

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Earnings before income taxes

P

$

20,868

 

$

20,307

 

$

17,967

 

$

19,210

 

$

21,206

 

Acquisition and charter conversion charges

 

3,793

 

 

1,190

 

 

3,641

 

 

1,172

 

 

408

 

Provision for loan losses

 

11,000

 

 

705

 

 

4,300

 

 

600

 

 

-

 

Bargain purchase gain and loss on sale of fixed assets

 

-

 

 

-

 

 

-

 

 

(165

)

 

-

 

Treasury Awards

 

-

 

 

-

 

 

-

 

 

(171

)

 

(702

)

Charitable contributions related to Treasury awards

 

-

 

 

-

 

 

-

 

 

165

 

 

-

 

BOLI income from death proceeds

 

-

 

 

-

 

 

-

 

 

-

 

 

(1,630

)

Pre-Tax, Pre-Provision Operating Earnings

Q

$

35,661

 

$

22,202

 

$

25,908

 

$

20,811

 

$

19,282

 

 

 

 

 

 

 

Annualized return on avg assets

N/A

 

0.81

%

 

1.01

%

 

0.88

%

 

1.03

%

 

1.09

%

Annualized return on avg assets, oper

O/A

 

1.36

%

 

1.07

%

 

1.23

%

 

1.08

%

 

0.97

%

Annualized pre-tax, pre-provision, oper

Q/A

 

1.78

%

 

1.38

%

 

1.63

%

 

1.36

%

 

1.24

%

Annualized return on avg common equity, oper

O/C

 

12.48

%

 

11.14

%

 

12.46

%

 

11.12

%

 

8.99

%

Annualized return on avg tangible common equity, operating

O/D

 

20.13

%

 

16.83

%

 

18.49

%

 

16.14

%

 

12.46

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

Capital Ratios

Mar 31,

2023*

Dec 31,

2022

Sept 30,

2022

June 30,

2022

Mar 31,

2022

Common equity tier 1 (CET1) ratio

 

11.2

%

 

12.7

%

 

12.6

%

 

12.7

%

 

13.1

%

Leverage (Tier 1) ratio

 

8.80

%

 

9.4

%

 

9.3

%

 

8.6

%

 

8.2

%

Total risk based capital ratio

 

14.72

%

 

16.7

%

 

16.7

%

 

17.3

%

 

17.9

%

Tangible common equity ratio

 

7.2

%

 

6.9

%

 

6.5

%

 

6.4

%

 

6.7

%

*estimated

 

Contacts

M. Ray “Hoppy” Cole

Chief Executive Officer

Dee Dee Lowery

Chief Financial Officer

(601) 268-8998

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