Farmers National Banc Corp. Announces Strong Results for First Quarter of 2024

• Earnings per diluted share of $0.30 ($0.34 excluding certain items, non-GAAP) for the first quarter of 2024
• 165 consecutive quarters of profitability
• Strategically restructured $44.3 million of investment securities improving the yield by almost 200 basis points – incurred a $2.1 million loss on the sale
• Deposit growth of $20.7 million, or 2.0% annualized, for the first quarter of 2024
• Excellent asset quality as non-performing loans to total loans improved to 0.38% at March 31, 2024 from 0.47% at December 31, 2023

Farmers National Banc Corp. (“Farmers” or the “Company”) (NASDAQ: FMNB) reported net income of $11.2 million, or $0.30 per diluted share, for the three months ended March 31, 2024, compared to $7.1 million, or $0.19 per diluted share, for the three months ended March 31, 2023. Net income for the first quarter of 2024 included a pretax item of $2.1 million for the loss on the sale of investment securities. Excluding this item (non-GAAP), net income for the first quarter of 2024 was $12.9 million, or $0.34 per diluted share.

Kevin J. Helmick, President and CEO, stated, “I am encouraged by the solid start to 2024 as we focus on leveraging the investments we made over the past year, pursuing actions to strategically improve our balance sheet, and maintaining the Company’s longstanding commitment to strong asset quality. While we expect the economic and interest rate environment to remain fluid in 2024, we believe we are well positioned to help our local communities build a better future by continuing to provide our customers with leading financial services.”

Balance Sheet

Total assets were $5.08 billion at March 31, 2024, unchanged from December 31, 2023. Loans decreased slightly to $3.18 billion at March 31, 2024 compared to $3.20 billion at December 31, 2023. The Company anticipates loan growth of 1 - 2%, in 2024 reflecting a more challenging economic and interest rate environment, as well as the Company’s focus on maintaining excellent asset quality.

The Company had securities available for sale of $1.27 billion at March 31, 2024, compared to $1.30 billion at December 31, 2023. Gross unrealized losses on the portfolio totaled $234.2 million at March 31, 2024, compared to gross unrealized losses of $217.1 million at December 31, 2023. The Company also completed a security restructure during the quarter, which involved selling approximately $44.3 million of securities and reinvesting the proceeds into securities with yields 200 basis points higher than those sold. The earn back on the $2.1 million loss that was incurred on the sale is approximately 2.5 years. The Company expects bond market volatility to continue in 2024 and anticipates that it will continue to allow the size of the securities portfolio to shrink via runoff to optimize profitability and provide liquidity.

Total deposits increased to $4.20 billion at March 31, 2024, compared to $4.18 billion at December 31, 2023. Noninterest bearing deposits declined $49.2 million during the first quarter of 2024 even as interest bearing deposits increased $69.9 million. Customers continue to seek higher rates on their deposit balances but the pace of activity has slowed somewhat.

Total stockholders’ equity was $397.0 million at March 31, 2024 compared to $404.4 million at December 31, 2023. The decline was driven by an increase in the unrealized losses on investment securities of $12.4 million offset by earnings net of dividend payments to shareholders.

Credit Quality

The Company’s non-performing loans dropped to $12.0 million at March 31, 2024, from $15.1 million at December 31, 2023. Non-performing loans to total loans was 0.38% at March 31, 2024, compared to 0.47% at December 31, 2023. Non-performing assets to total assets were 0.24% at March 31, 2024, compared to 0.30% at December 31, 2023. The Company’s loans which were 30-89 days delinquent were $14.1 million at March 31, 2024, or 0.44% of total loans.

The provision for credit losses and unfunded commitments was a recovery of $449,000 in the first quarter of 2024 compared to provision expense for credit losses and unfunded commitments of $8.6 million for the first quarter of 2023. On January 1, 2023, the Company completed its acquisition of Emclaire Financial Corp. As a result of this acquisition, the Company incurred a day one provision expense for credit losses and unfunded commitments of $7.7 million. The recovery of provision expense in the first quarter of 2024 was due to shrinkage in the loan portfolio and continued improvements in the Company’s credit metrics. Annualized net charge-offs as a percentage of average loans were 0.13% for the three months ended March 31, 2024, compared to 0.03% for the three months ended March 31, 2023. The allowance for credit losses to total loans was 1.04% at March 31, 2024, compared to 1.08% at December 31, 2023.

Net Interest Income

The Company’s net interest income for the three months ended March 31, 2024, totaled $31.7 million compared to $36.6 million in the first quarter of 2023. Average earning assets have declined $69.3 million when comparing the first quarter of 2024 to the first quarter of 2023 due to the runoff in investment securities exceeding the growth in loan balances. In addition, the net interest margin has declined from 3.07% in the first quarter of 2023 to 2.70% in the first quarter of 2024. The decline in net interest margin between the first quarter of 2024 and the first quarter of 2023 was due to increased funding costs outstripping the increase in yields on earning assets. This increase in funding costs has been due to the rapid increase in deposit rates due to intense competition for deposits, the Federal Reserve’s rate hiking cycle, and runoff of deposit balances which are being replaced with more costly wholesale funding.

Noninterest Income

The Company reported noninterest income of $8.4 million during the first quarter of 2024 compared to $10.4 million for the first quarter of 2023. This decrease is primarily due to the Company completing the securities restructure in the first quarter of 2024, which resulted in a $2.1 million loss on the sale of the securities. In the first quarter of 2023, the Company recognized $121,000 in securities gains.

Service charges on deposit accounts were $1.6 million for the first quarter of 2024 compared to $1.4 million for the same period in 2023 due to increased activity. Bank owned life insurance income increased to $707,000 in the first quarter from $547,000 in the first quarter of 2023. A death benefit of $83,000 in 2024 and higher earnings credit on the policies drove the increase. Trust fees increased by $206,000 in the first quarter of 2024 compared to the same period in 2023 due to continued strong growth in this line of business. Likewise, insurance commissions, retirement consulting fees and investment commissions all exhibited solid growth in the first quarter of 2024 compared to the first quarter of 2023. Debit card income declined $222,000 to $1.6 million in the first quarter of 2024 compared to $1.8 million for the first quarter of 2023 reflecting a year-over-year decline in average customer spend per transaction. Other noninterest income declined to $1.1 million for the first three months of 2024 compared to $1.3 million for the first three months of 2023 as the Company received less SBIC income from its investments in 2024 compared to 2023.

Noninterest Expense

Noninterest expense was $27.0 million for the first three months of 2024 compared to $30.7 million for the first three months of 2023. This decrease was primarily driven by the Company recording $4.3 million in merger related charges in 2023. There were no merger related charges recorded in 2024. Salaries and employee benefits were $15.1 million in the first quarter of 2024 compared to $14.6 million in the first quarter of 2023. The increase was primarily driven by higher salaries associated with employee raises. Occupancy and equipment expense decreased by $139,000 in the first quarter of 2024 compared to the first quarter of 2023 primarily due to several branch closures. FDIC and state and local taxes increased $123,000 to $1.3 million for the first three months of 2024 compared to $1.2 million for the first three months of 2023 due to an increase in the FDIC assessment rate. Professional fees increased $140,000 for the three months ended March 31, 2024, compared to the first quarter of 2023 primarily due to increased legal fees. Intangible amortization declined $220,000 in the first three months of 2024 to $688,000 compared to $909,000 for the first three months of 2023 primarily due to the amortization from a prior acquisition running off. Other noninterest expense increased $309,000 in the first quarter of 2024 compared to the first quarter of 2023.

Liquidity

At March 31, 2024, the Company’s loan to deposit ratio was 75.8% and the Company’s average deposit balance per account (excluding collateralized deposits) was $22,748. The Company has access to an additional $739.9 million of FHLB borrowing capacity at March 31, 2024, along with $274.6 million of available for sale securities that are not pledged.

About Farmers National Banc Corp.

Founded in 1887, Farmers National Banc Corp. is a diversified financial services company headquartered in Canfield, Ohio, with $5.1 billion in banking assets. Farmers National Banc Corp.’s wholly-owned subsidiaries are comprised of The Farmers National Bank of Canfield, a full-service national bank engaged in commercial and retail banking with 62 banking locations in Mahoning, Trumbull, Columbiana, Portage, Stark, Wayne, Medina, Geauga and Cuyahoga Counties in Ohio and Beaver, Butler, Allegheny, Jefferson, Clarion, Venango, Clearfield, Mercer, Elk and Crawford Counties in Pennsylvania, and Farmers Trust Company, which operates five trust offices and offers services in the same geographic markets. Total wealth management assets under care at March 31, 2024 are $3.8 billion. Farmers National Insurance, LLC, a wholly-owned subsidiary of The Farmers National Bank of Canfield, offers a variety of insurance products.

Non-GAAP Disclosure

This press release includes disclosures of Farmers’ tangible common equity ratio, return on average tangible assets, return on average tangible equity, net income excluding costs related to acquisition activities and certain items, return on average assets excluding merger costs and certain items, return on average equity excluding merger costs and certain items, net interest margin excluding acquisition marks and related accretion and PPP interest and fees and efficiency ratio less certain items, which are financial measures not prepared in accordance with generally accepted accounting principles in the United States (GAAP). A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed by GAAP. Farmers believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the underlying operational results and trends and Farmers’ marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with GAAP. The reconciliations of non-GAAP financial measures to their GAAP equivalents are included in the tables following Consolidated Financial Highlights below.

Cautionary Statements Regarding Forward-Looking Statements

We make statements in this news release and our related investor conference call, and we may from time to time make other statements, that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about Farmers’ financial condition, results of operations, asset quality trends and profitability. Forward-looking statements are not historical facts but instead represent only management’s current expectations and forecasts regarding future events, many of which, by their nature, are inherently uncertain and outside of Farmers’ control. Forward-looking statements are preceded by terms such as “expects,” “believes,” “anticipates,” “intends” and similar expressions, as well as any statements related to future expectations of performance or conditional verbs, such as “will,” “would,” “should,” “could” or “may.” Farmers’ actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Factors that could cause Farmers’ actual results to differ materially from those described in certain forward-looking statements include significant changes in near-term local, regional, and U.S. economic conditions including those resulting from continued high rates of inflation, tightening monetary policy of the Board of Governors of the Federal Reserve, and possibility of a recession; and the other factors contained in Farmers’ Annual Report on Form 10-K for the year ended December 31, 2023 and subsequent Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission (SEC) and available on Farmers’ website (www.farmersbankgroup.com) and on the SEC’s website (www.sec.gov). Forward-looking statements are not guarantees of future performance and should not be relied upon as representing management’s views as of any subsequent date. Farmers does not undertake any obligation to update the forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.

Farmers National Banc Corp. and Subsidiaries

Consolidated Financial Highlights

(Amounts in thousands, except per share results) Unaudited












 







 

Consolidated Statements of Income

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

2024

2023

2023

2023

2023

Total interest income

$

55,054

 

$

55,069

 

$

54,229

 

$

52,804

 

$

51,233

 

Total interest expense

 

23,367

 

 

22,239

 

 

20,461

 

 

18,226

 

 

14,623

 

Net interest income

 

31,687

 

 

32,830

 

 

33,768

 

 

34,578

 

 

36,610

 

Provision (credit) for credit losses

 

(449

)

 

286

 

 

243

 

 

25

 

 

8,599

 

Noninterest income

 

8,357

 

 

12,156

 

 

9,831

 

 

9,449

 

 

10,425

 

Acquisition related costs

 

0

 

 

452

 

 

268

 

 

442

 

 

4,313

 

Other expense

 

27,039

 

 

26,520

 

 

27,448

 

 

25,944

 

 

26,409

 

Income before income taxes

 

13,454

 

 

17,728

 

 

15,640

 

 

17,616

 

 

7,714

 

Income taxes

 

2,214

 

 

3,151

 

 

2,326

 

 

2,650

 

 

639

 

Net income

$

11,240

 

$

14,577

 

$

13,314

 

$

14,966

 

$

7,075

 

 


Average diluted shares outstanding

 

37,479

 

 

37,426

 

 

37,379

 

 

37,320

 

 

37,933

 

Basic earnings per share

 

0.30

 

 

0.39

 

 

0.36

 

 

0.40

 

 

0.19

 

Diluted earnings per share

 

0.30

 

 

0.39

 

 

0.36

 

 

0.40

 

 

0.19

 

Cash dividends per share

 

0.17

 

 

0.17

 

 

0.17

 

 

0.17

 

 

0.17

 

Performance Ratios

Net Interest Margin (Annualized)

 

2.70

%

 

2.78

%

 

2.86

%

 

2.92

%

 

3.07

%

Efficiency Ratio (Tax equivalent basis)

 

61.54

%

 

57.84

%

 

60.11

%

 

56.28

%

 

62.53

%

Return on Average Assets (Annualized)

 

0.90

%

 

1.17

%

 

1.06

%

 

1.18

%

 

0.56

%

Return on Average Equity (Annualized)

 

11.47

%

 

17.98

%

 

14.49

%

 

16.12

%

 

7.71

%

Dividends to Net Income

 

56.65

%

 

43.68

%

 

47.82

%

 

42.54

%

 

90.50

%

Other Performance Ratios (Non-GAAP)

Return on Average Tangible Assets

 

0.93

%

 

1.22

%

 

1.09

%

 

1.23

%

 

0.58

%

Return on Average Tangible Equity

 

21.88

%

 

43.77

%

 

30.29

%

 

33.55

%

 

16.31

%

Consolidated Statements of Financial Condition

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

2024

2023

2023

2023

2023

Assets

Cash and cash equivalents

$

148,630

 

$

103,658

 

$

93,923

 

$

116,063

 

$

128,001

 

Debt securities available for sale

 

1,270,149

 

 

1,299,701

 

 

1,210,736

 

 

1,316,878

 

 

1,355,449

 

Other investments

 

34,619

 

 

35,311

 

 

35,342

 

 

44,975

 

 

39,670

 

 


Loans held for sale

 

1,854

 

 

3,711

 

 

1,910

 

 

2,197

 

 

1,703

 

Loans

 

3,181,318

 

 

3,198,127

 

 

3,168,554

 

 

3,155,200

 

 

3,152,339

 

Less allowance for credit losses

 

33,159

 

 

34,440

 

 

34,753

 

 

34,957

 

 

36,011

 

Net Loans

 

3,148,159

 

 

3,163,687

 

 

3,133,801

 

 

3,120,243

 

 

3,116,328

 

 


Other assets

 

476,599

 

 

472,282

 

 

495,451

 

 

473,098

 

 

468,735

 

Total Assets

$

5,080,010

 

$

5,078,350

 

$

4,971,163

 

$

5,073,454

 

$

5,109,886

 

Liabilities and Stockholders' Equity

Deposits







Noninterest-bearing

$

977,475

 

$

1,026,630

 

$

1,039,524

 

$

1,084,232

 

$

1,106,870

 

Interest-bearing

 

3,220,650

 

 

3,150,756

 

 

3,217,869

 

 

3,165,381

 

 

3,207,121

 

Brokered time deposits

 

0

 

 

0

 

 

254,257

 

 

21,135

 

 

82,169

 

Total deposits

 

4,198,125

 

 

4,177,386

 

 

4,511,650

 

 

4,270,748

 

 

4,396,160

 

Other interest-bearing liabilities

 

433,777

 

 

443,663

 

 

88,550

 

 

388,437

 

 

292,324

 

Other liabilities

 

51,082

 

 

52,886

 

 

54,981

 

 

47,278

 

 

46,760

 

Total liabilities

 

4,682,984

 

 

4,673,935

 

 

4,655,181

 

 

4,706,463

 

 

4,735,244

 

Stockholders' Equity

 

397,026

 

 

404,415

 

 

315,982

 

 

366,991

 

 

374,642

 

Total Liabilities

and Stockholders' Equity

$

5,080,010

 

$

5,078,350

 

$

4,971,163

 

$

5,073,454

 

$

5,109,886

 

 


Period-end shares outstanding

 

37,546

 

 

37,503

 

 

37,489

 

 

37,457

 

 

37,439

 

Book value per share

$

10.57

 

$

10.78

 

$

8.43

 

$

9.80

 

$

10.01

 

Tangible book value per share (Non-GAAP)*

 

5.52

 

 

5.71

 

 

3.33

 

 

4.67

 

 

4.84

 

 


* Tangible book value per share is calculated by dividing tangible common equity by outstanding shares

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

Capital and Liquidity

2024

2023

2023

2023

2023

Common Equity Tier 1 Capital Ratio (a)

 

10.88

%

 

10.61

%

 

10.37

%

 

10.25

%

 

10.04

%

Total Risk Based Capital Ratio (a)

 

14.33

%

 

14.06

%

 

13.83

%

 

13.76

%

 

13.60

%

Tier 1 Risk Based Capital Ratio (a)

 

11.38

%

 

11.10

%

 

10.86

%

 

10.74

%

 

10.54

%

Tier 1 Leverage Ratio (a)

 

8.19

%

 

8.02

%

 

7.84

%

 

7.68

%

 

7.43

%

Equity to Asset Ratio

 

7.82

%

 

7.96

%

 

6.36

%

 

7.23

%

 

7.33

%

Tangible Common Equity Ratio (b)

 

4.24

%

 

4.38

%

 

2.61

%

 

3.58

%

 

3.69

%

Net Loans to Assets

 

61.97

%

 

62.30

%

 

63.04

%

 

61.50

%

 

60.99

%

Loans to Deposits

 

75.78

%

 

76.56

%

 

70.23

%

 

73.88

%

 

71.71

%

Asset Quality

Non-performing loans

$

11,951

 

$

15,063

 

$

18,368

 

$

17,956

 

$

17,959

 

Non-performing assets

 

12,215

 

 

15,321

 

 

18,522

 

 

18,167

 

 

18,053

 

Loans 30 - 89 days delinquent

 

14,069

 

 

16,705

 

 

13,314

 

 

12,321

 

 

10,219

 

Charged-off loans

 

1,282

 

 

972

 

 

525

 

 

971

 

 

469

 

Recoveries

 

271

 

 

172

 

 

139

 

 

172

 

 

198

 

Net Charge-offs

 

1,011

 

 

800

 

 

386

 

 

799

 

 

271

 

Annualized Net Charge-offs to Average Net Loans

 

0.13

%

 

0.10

%

 

0.05

%

 

0.10

%

 

0.03

%

Allowance for Credit Losses to Total Loans

 

1.04

%

 

1.08

%

 

1.10

%

 

1.11

%

 

1.14

%

Non-performing Loans to Total Loans

 

0.38

%

 

0.47

%

 

0.58

%

 

0.57

%

 

0.57

%

Loans 30 - 89 Days Delinquent to Total Loans

 

0.44

%

 

0.52

%

 

0.42

%

 

0.39

%

 

0.32

%

Allowance to Non-performing Loans

 

277.46

%

 

228.64

%

 

189.20

%

 

194.68

%

 

200.52

%

Non-performing Assets to Total Assets

 

0.24

%

 

0.30

%

 

0.37

%

 

0.36

%

 

0.35

%

 


(a) March 31, 2024 ratio is estimated


(b) This is a non-GAAP financial measure. A reconciliation to GAAP is shown below







 

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

End of Period Loan Balances

2024

2023

2023

2023

2023

Commercial real estate

$

1,339,372

 

$

1,335,806

 

$

1,295,847

 

$

1,284,974

 

$

1,286,830

 

Commercial

 

335,747

 

 

346,354

 

 

357,691

 

 

362,664

 

 

361,845

 

Residential real estate

 

836,252

 

 

843,697

 

 

842,729

 

 

849,533

 

 

853,074

 

HELOC

 

143,696

 

 

142,441

 

 

140,772

 

 

138,535

 

 

137,319

 

Consumer

 

256,846

 

 

259,784

 

 

261,136

 

 

260,326

 

 

260,596

 

Agricultural loans

 

260,425

 

 

261,288

 

 

261,738

 

 

250,807

 

 

244,938

 

Total, excluding net deferred loan costs

$

3,172,338

 

$

3,189,370

 

$

3,159,913

 

$

3,146,839

 

$

3,144,602

 

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

End of Period Customer Deposit Balances

2024

2023

2023

2023

2023

Noninterest-bearing demand

$

977,474

 

$

1,026,630

 

$

1,039,524

 

$

1,084,232

 

$

1,106,870

 

Interest-bearing demand

 

1,381,383

 

 

1,362,609

 

 

1,426,349

 

 

1,383,326

 

 

1,473,001

 

Money market

 

646,308

 

 

593,975

 

 

588,043

 

 

610,051

 

 

599,037

 

Savings

 

452,949

 

 

468,890

 

 

488,991

 

 

511,642

 

 

535,321

 

Certificate of deposit

 

740,011

 

 

725,282

 

 

714,486

 

 

660,362

 

 

599,762

 

Total customer deposits

$

4,198,125

 

$

4,177,386

 

$

4,257,393

 

$

4,249,613

 

$

4,313,991

 

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

Noninterest Income

2024

2023

2023

2023

2023

Service charges on deposit accounts

$

1,583

 

$

1,677

 

$

1,712

 

$

1,501

 

$

1,432

 

Bank owned life insurance income, including death benefits

 

707

 

 

617

 

 

694

 

 

584

 

 

547

 

Trust fees

 

2,793

 

 

2,656

 

 

2,617

 

 

2,248

 

 

2,587

 

Insurance agency commissions

 

1,528

 

 

1,540

 

 

1,116

 

 

1,332

 

 

1,456

 

Security gains (losses), including fair value changes for equity securities

 

(2,120

)

 

19

 

 

(624

)

 

13

 

 

121

 

Retirement plan consulting fees

 

334

 

 

357

 

 

360

 

 

382

 

 

307

 

Investment commissions

 

432

 

 

589

 

 

520

 

 

476

 

 

393

 

Net gains on sale of loans

 

297

 

 

1,280

 

 

395

 

 

406

 

 

310

 

Other mortgage banking fee income (loss), net

 

125

 

 

139

 

 

185

 

 

234

 

 

153

 

Debit card and EFT fees

 

1,567

 

 

1,697

 

 

1,763

 

 

1,810

 

 

1,789

 

Other noninterest income

 

1,111

 

 

1,585

 

 

1,093

 

 

463

 

 

1,330

 

Total Noninterest Income

$

8,357

 

$

12,156

 

$

9,831

 

$

9,449

 

$

10,425

 

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

Noninterest Expense

2024

2023

2023

2023

2023

Salaries and employee benefits

$

15,069

 

$

14,871

 

$

14,233

 

$

13,625

 

$

14,645

 

Occupancy and equipment

 

3,730

 

 

3,896

 

 

3,810

 

 

3,859

 

 

3,869

 

FDIC insurance and state and local taxes

 

1,345

 

 

1,484

 

 

1,648

 

 

1,494

 

 

1,222

 

Professional fees

 

1,254

 

 

1,004

 

 

1,043

 

 

1,190

 

 

1,114

 

Merger related costs

 

0

 

 

452

 

 

268

 

 

442

 

 

4,313

 

Advertising

 

431

 

 

414

 

 

492

 

 

478

 

 

409

 

Intangible amortization

 

688

 

 

578

 

 

725

 

 

1,222

 

 

909

 

Core processing charges

 

1,135

 

 

1,057

 

 

1,274

 

 

1,144

 

 

1,164

 

Other noninterest expenses

 

3,387

 

 

3,216

 

 

4,223

 

 

2,932

 

 

3,077

 

Total Noninterest Expense

$

27,039

 

$

26,972

 

$

27,716

 

$

26,386

 

$

30,722

 

Average Balance Sheets and Related Yields and Rates

(Dollar Amounts in Thousands)








 

Three Months Ended

Three Months Ended

March 31, 2024

March 31, 2023

AVERAGE

YIELD/
AVERAGE

YIELD/



BALANCE
INTEREST (1)
RATE (1)
BALANCE
INTEREST (1)
RATE (1)


EARNING ASSETS








Loans (2)

$

3,181,337

$

45,096

5.67

%

$

3,136,494

$

40,942

5.22

%

Taxable securities

 

1,101,347

 

6,415

2.33

 

 

1,171,596

 

6,550

2.24

 

Tax-exempt securities (2)

 

408,075

 

3,208

3.14

 

 

438,614

 

3,519

3.21

 

Other investments

 

34,406

 

362

4.21

 

 

36,564

 

376

4.11

 

Federal funds sold and other

 

71,757

 

626

3.49

 

 

82,995

 

610

2.94

 

Total earning assets

 

4,796,922

 

55,707

4.65

 

 

4,866,263

 

51,997

4.27

 

Nonearning assets

 

227,044

 

218,746

Total assets

$

5,023,966

$

5,085,009

INTEREST-BEARING LIABILITIES








Time deposits

$

736,932

$

7,048

3.83

%

$

590,412

$

3,339

2.26

%

Brokered time deposits

 

0

 

0

0.00

 

 

231,040

 

2,321

4.02

 

Savings deposits

 

1,084,579

 

3,598

1.33

 

 

1,153,588

 

1,954

0.68

 

Demand deposits - interest bearing

 

1,345,311

 

7,743

2.30

 

 

1,417,955

 

5,093

1.44

 

Total interest-bearing deposits

 

3,166,822

 

18,389

2.32

 

 

3,392,995

 

12,707

1.50

 

 


Short term borrowings

 

324,791

 

3,939

4.85

 

 

80,589

 

921

4.57

 

Long term borrowings

 

88,721

 

1,038

4.68

 

 

88,269

 

995

4.51

 

Total borrowed funds

 

413,512

 

4,977

4.81

 

 

168,858

 

1,916

4.54

 

 


Total interest-bearing liabilities

 

3,580,334

 

23,366

2.61

 

 

3,561,853

 

14,623

1.64

 

 


NONINTEREST-BEARING LIABILITIES AND STOCKHOLDERS' EQUITY








Demand deposits - noninterest bearing

 

995,168

 

1,107,422

Other liabilities

 

52,915

 

48,883

Stockholders' equity

 

395,549

 

366,851

 


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

5,023,966

$

5,085,009

Net interest income and interest rate spread

$

32,341

2.04

%

$

37,374

2.63

%

Net interest margin

2.70

%

3.07

%

 


(1) Interest and yields are calculated on a tax-equivalent basis where applicable.


(2) For 2024, adjustments of $80 thousand and $573 thousand, respectively, were made to tax equate income on tax exempt loans and tax exempt securities. For 2023, adjustments of $86 thousand and $678 thousand, respectively, were made to tax equate income on tax exempt loans and tax exempt securities. These adjustments were based on a marginal federal income tax rate of 21%, less disallowances.

Reconciliation of Total Assets to Tangible Assets

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

2024

2023

2023

2023

2023

Total Assets

$

5,080,010

 

$

5,078,350

 

$

4,971,163

 

$

5,073,454

 

$

5,109,886

 

Less Goodwill and other intangibles

 

189,599

 

 

190,288

 

 

191,326

 

 

192,052

 

 

193,273

 

Tangible Assets

$

4,890,411

 

$

4,888,062

 

$

4,779,837

 

$

4,881,402

 

$

4,916,613

 

Average Assets

 

5,023,966

 

 

4,980,314

 

 

5,058,969

 

 

5,070,444

 

 

5,085,009

 

Less average Goodwill and other intangibles

 

190,040

 

 

191,108

 

 

191,804

 

 

192,972

 

 

193,368

 

Average Tangible Assets

$

4,833,926

 

$

4,789,206

 

$

4,867,165

 

$

4,877,472

 

$

4,891,641

 

Reconciliation of Common Stockholders' Equity to Tangible Common Equity

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

2024

2023

2023

2023

2023

Stockholders' Equity

$

397,026

 

$

404,415

 

$

315,982

 

$

366,991

 

$

374,642

 

Less Goodwill and other intangibles

 

189,599

 

 

190,288

 

 

191,326

 

 

192,052

 

 

193,273

 

Tangible Common Equity

$

207,427

 

$

214,127

 

$

124,656

 

$

174,939

 

$

181,369

 

Average Stockholders' Equity

 

395,549

 

 

324,332

 

 

367,600

 

 

371,421

 

 

366,851

 

Less average Goodwill and other intangibles

 

190,040

 

 

191,108

 

 

191,804

 

 

192,972

 

 

193,368

 

Average Tangible Common Equity

$

205,509

 

$

133,224

 

$

175,796

 

$

178,449

 

$

173,483

 

Reconciliation of Net Income, Less Merger and Certain Items

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

2024

2023

2023

2023

2023

Net income

$

11,240

 

$

14,577

 

$

13,314

 

$

14,966

 

$

7,075

 

Acquisition related costs - after tax

 

0

 

 

358

 

 

234

 

 

354

 

 

3,449

 

Acquisition related provision - after tax

 

0

 

 

0

 

 

0

 

 

0

 

 

6,077

 

Employee severence - after tax

 

0

 

 

798

 

 

0

 

 

0

 

 

0

 

Lawsuit settlement expense - after tax

 

0

 

 

0

 

 

620

 

 

0

 

 

0

 

Net (gain) on loan sale - after tax

 

0

 

 

(723

)

 

0

 

 

0

 

 

0

 

Net loss (gain) on security sales - after tax

 

1,675

 

 

171

 

 

604

 

 

(5

)

 

(72

)

Net income - Adjusted

$

12,915

 

$

15,181

 

$

14,772

 

$

15,315

 

$

16,529

 

Diluted EPS excluding merger and certain items

$

0.34

 

$

0.41

 

$

0.40

 

$

0.41

 

$

0.44

 

Return on Average Assets excluding merger and certain items (Annualized)

 

1.03

%

 

1.22

%

 

1.17

%

 

1.21

%

 

1.30

%

Return on Average Equity excluding merger and certain items (Annualized)

 

13.06

%

 

18.72

%

 

16.07

%

 

16.49

%

 

18.02

%

Return on Average Tangible Equity excluding acquisition costs and certain items (Annualized)

 

25.14

%

 

45.58

%

 

33.61

%

 

34.33

%

 

38.11

%

Efficiency ratio excluding certain items

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

2024

2023

2023

2023

2023

Net interest income, tax equated

$

32,341

 

$

33,494

 

$

34,448

 

$

35,273

 

$

37,374

 

Noninterest income

 

8,357

 

 

12,156

 

 

9,831

 

 

9,449

 

 

10,425

 

Net (gain) on loan sale

 

0

 

 

(915

)

 

0

 

 

0

 

 

0

 

Net loss (gain) on security sales

 

2,120

 

 

217

 

 

764

 

 

(6

)

 

(91

)

Net interest income and noninterest income adjusted

 

42,818

 

 

44,952

 

 

45,043

 

 

44,716

 

 

47,708

 

Noninterest expense less intangible amortization

 

26,351

 

 

26,394

 

 

26,991

 

 

25,163

 

 

29,813

 

Legal settlement expense

 

0

 

 

0

 

 

785

 

 

0

 

 

0

 

Employee severence

 

0

 

 

1,010

 

 

0

 

 

0

 

 

0

 

Acquisition related costs

 

0

 

 

452

 

 

268

 

 

442

 

 

4,313

 

Noninterest expense adjusted

 

26,351

 

 

24,932

 

 

25,938

 

 

24,721

 

 

25,500

 

Efficiency ratio excluding certain items

 

61.54

%

 

55.46

%

 

57.58

%

 

55.28

%

 

53.45

%

Net interest margin excluding acquisition marks and PPP interest and fees

For the Three Months Ended

March 31,

Dec. 31,

Sept. 30,

June 30,

March 31,

2024

2023

2023

2023

2023

Net interest income, tax equated

$

32,341

 

$

33,494

 

$

34,448

 

$

35,273

 

$

37,374

 

Acquisition marks

 

2,370

 

 

2,475

 

 

2,959

 

 

2,884

 

 

2,628

 

PPP interest and fees

 

0

 

 

1

 

 

1

 

 

3

 

 

0

 

Adjusted and annualized net interest income

 

119,884

 

 

124,072

 

 

125,952

 

 

129,544

 

 

138,984

 

Average earning assets

 

4,796,922

 

 

4,816,409

 

 

4,820,888

 

 

4,830,910

 

 

4,866,263

 

Less PPP average balances

 

213

 

 

229

 

 

247

 

 

277

 

 

310

 

Adjusted average earning assets

 

4,796,709

 

 

4,816,180

 

 

4,820,641

 

 

4,830,633

 

 

4,865,953

 

Net interest margin excluding marks and PPP interest and fees

 

2.50

%

 

2.58

%

 

2.61

%

 

2.68

%

 

2.86

%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240423844566/en/

Kevin J. Helmick, President and CEO 330.533.3341 Email: [e-mail]