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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Guaranty Bancshares Inc | NYSE:GNTY | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.73 | 2.50% | 29.95 | 30.00 | 29.40 | 29.51 | 10,270 | 22:30:01 |
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 and year ended December 31, 2023. The Company's net income available to common shareholders was $5.9 million, or $0.51 per basic share, for the quarter ended December 31, 2023, compared to $6.3 million, or $0.54 per basic share, for the quarter ended September 30, 2023 and $8.0 million, or $0.67 per basic share, for the quarter ended December 31, 2022. Return on average assets and average equity for the fourth quarter of 2023 were 0.73% and 7.93%, respectively, compared to 0.78% and 8.43%, respectively, for the third quarter of 2023 and 0.95% and 10.88%, respectively, for the fourth quarter of 2022. The decrease in earnings during the fourth quarter of 2023 compared to the third quarter of 2023 was primarily due to fluctuations in general operating expenses. The decrease in earnings in the fourth quarter of 2023 compared to the fourth quarter of 2022 was primarily due to lower net interest income in the current quarter, offset by a $2.8 million provision for credit losses in the prior year quarter.
"Despite the many industry headwinds in 2023, our earnings were relatively good. Our net interest margin hit its lowest point in 2023 during the third quarter but has steadily increased each month in the fourth quarter as our loans reprice and cost of non-maturing deposits remain steady. Our balance sheet is strong and our earnings stream continues to produce consistent results. Non-performing assets remain very low and although we anticipate the need to work with some borrowers as their loan rates adjust, we do not foresee any significant problems as a result of the higher interest rate environment or economic slowdown at this point. We are looking forward to 2024 and have built a balance sheet that will allow us to grow and capitalize on new opportunities when the timing is right and economic conditions become less uncertain. Our liquidity and capital remains very healthy and we continue to focus on driving long term shareholder value," said Ty Abston, the Company's Chairman and Chief Executive Officer.
QUARTERLY AND ANNUAL HIGHLIGHTS
† 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 fourth quarter of 2023 and 2022 was $23.8 million and $28.4 million, respectively, a decrease of $4.5 million, or 16.0%. The decrease in net interest income resulted from an increase in interest expense of $9.6 million, or 130.7%, compared to the prior year quarter, which was partially offset by an increase in interest income of $5.1 million, or 14.2%, 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 impacted by a shift from noninterest-bearing to interest-bearing deposit accounts, which resulted in increased expense in the fourth quarter of 2023 compared to the prior year quarter.
Net interest margin, on a fully taxable equivalent basis, for the fourth quarter of 2023 and 2022 was 3.11% and 3.57%, respectively. Net interest margin decreased 46 basis points primarily due to interest-bearing liabilities repricing faster than our interest-earning assets and a shift from no or lower interest cost DDA and money market accounts to higher cost certificates of deposit. The cost of interest-bearing liabilities increased 184 basis points from the prior year quarter, while interest earning asset yields increased 90 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 1.08% to 3.17%, a change of 209 basis points, in the fourth quarter of 2023 compared to the same period in 2022, as well as increased rates on FHLB advances, which increased from 3.97% to 5.40%, an increase of 143 basis points, from the prior year quarter. The increases in cost were partially offset by increases in yield on the loan portfolio from 5.19% to 6.06%, or 87 basis points, as well as 38 and 34 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 $89.6 million in new loans originated in the fourth quarter was 8.61%.
Net interest income, before the provision for credit losses, increased $511,000, or 2.2%, from $23.3 million in the third quarter of 2023 to $23.8 million in the fourth quarter of 2023. The increase in net interest income resulted primarily from an increase in interest income of $978,000, or 2.5%, partially offset by an increase in interest expense of $467,000, or 2.8%. The increase in interest income was primarily due to higher interest earned on loans of $808,000, or 2.3%, from the prior quarter and higher interest earned on securities of $103,000, or 2.5%. The increase in interest expense resulted primarily from an increase of $1.2 million, or 9.5%, in interest-bearing deposit expense, partially offset by a decrease in FHLB advances expense of $673,000, or 26.0%, and a decrease in interest expense on other borrowed money of $102,000, or 31.4%, from the prior quarter.
Net interest margin, on a taxable equivalent basis, increased from 3.02% for the third quarter of 2023 to 3.11% for the fourth quarter of 2023, an increase of nine basis points. The increase in net interest margin was primarily due to an increase on loan yield from 5.91% for the third quarter of 2023 to 6.06% for the fourth quarter of 2023, a change of 15 basis points. This increase was partially offset by an increase in the cost of interest-bearing deposits from 3.00% in the third quarter to 3.17% in the fourth quarter of 2023, a change of 17 basis points.
We recorded no provision for credit losses during 2023. During the fourth quarter of 2022, we recorded a $2.8 million provision to incorporate forecasts for an economic downturn and possible borrower stressors into our CECL model. The factors that were adjusted in the fourth quarter of 2022 remain relevant, however certain minor adjustments were made in subsequent quarters to reflect current portfolio credit quality trends. As of December 31, 2023 and December 31, 2022, our allowance for credit losses as a percentage of total loans was 1.33% and 1.34%, respectively.
Noninterest income decreased $326,000, or 6.4%, in the fourth quarter of 2023 to $4.8 million, compared to $5.1 million for the fourth quarter of 2022. The decrease from the same quarter in 2022 was partially due to a gain on securities sold of $172,000 in the prior year quarter and no gain on securities sales in the current quarter. There was also a decrease in the gain on sale of loans of $114,000, or 36.8% along with a $51,000, or 63.0%, decrease in mortgage fee income compared to the same quarter in the prior year.
Noninterest expense increased $505,000, or 2.4%, in the fourth quarter of 2023 to $21.4 million, compared to $20.9 million for the fourth quarter of 2022. The increase in noninterest expense in the fourth quarter of 2023 was driven primarily by a $351,000, or 2.8%, increase in employee compensation and benefits, an increase in software and technology expense of $215,000, or 14.1%, and a $175,000, or 22.5%, increase in legal and professional fees primarily related to recruiting fees compared to the fourth quarter of 2022. These were partially offset by a $136,000, or 27.9%, decrease in advertising and promotions expense.
Noninterest income in the fourth quarter of 2023 decreased by $143,000, or 2.9%, from $4.9 million in the third quarter of 2023. The decrease is primarily due to a decrease in other noninterest income of $62,000, or 8.2%, primarily the result of decreased credit card income during the period. Gain on sale of loans decreased $22,000, or 10.1%, while bank-owned life insurance income decreased $17,000, or 6.4%. Additionally, mortgage fee income fell $16,000, or 34.8%, and loan processing fee income decreased $12,000, or 9.4% from the third quarter.
Noninterest expense increased $888,000, or 4.3%, in the fourth quarter of 2023, from $20.5 million for the quarter ended September 30, 2023. The increase resulted from an increase of $771,000, or 6.5%, in employee compensation and benefits primarily due to annual raises, which went into effect during the fourth quarter. There was also a $250,000, or 16.8%, increase in software and technology expense and a $64,000, or 22.2%, increase in advertising and promotions expense during the fourth quarter of 2023 compared to the third quarter of 2023. These increases were partially offset by a $203,000, or 6.9%, decrease in occupancy expenses due to lower than anticipated property taxes payable and a reverse accrual posted in the fourth quarter, compared with the third quarter of 2023.
The Company’s efficiency ratio in the fourth quarter of 2023 was 74.81%, compared to 62.42% in the prior year quarter and 72.64% in the third quarter of 2023.
FINANCIAL CONDITION
Consolidated assets for the Company totaled $3.18 billion at December 31, 2023, compared to $3.23 billion at September 30, 2023 and $3.35 billion at December 31, 2022.
Gross loans increased slightly by $4.3 million, or 0.19%, during the quarter resulting in a gross loan balance of $2.32 billion at both December 31, 2023 and September 30, 2023. Our loan growth is entirely due to organic loan growth during the quarter and not to purchases of assets.
Gross loans decreased $55.6 million, or 2.3%, from $2.38 billion at December 31, 2022. The decrease in gross loans during the fourth quarter of 2023 compared to the fourth quarter of 2022 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 $25.0 million, or 0.9%, to $2.63 billion at December 31, 2023, compared to $2.66 billion at September 30, 2023, and decreased $47.9 million, or 1.8%, from $2.68 billion at December 31, 2022. The decrease in deposits during the fourth quarter resulted from a decrease in noninterest-bearing deposits of $50.4 million, offset by an increase in interest-bearing deposits of $25.4 million. We also allowed $25.0 million in brokered certificates of deposit to mature and not renew during the fourth quarter of 2023. The decrease in deposits during the current quarter compared to the prior year quarter resulted primarily from a decrease in noninterest-bearing deposits of $199.2 million, partially offset by an increase in interest-bearing deposits of $151.3 million.
Nonperforming assets as a percentage of total loans were 0.25% at December 31, 2023, compared to 0.13% at September 30, 2023 and 0.46% at December 31, 2022. Nonperforming assets as a percentage of total assets were 0.18% at December 31, 2023, compared to 0.09% at September 30, 2023, and 0.32% at December 31, 2022. The Bank's nonperforming assets consist primarily of nonaccrual loans. The decrease in nonperforming assets compared to the prior year end is primarily due to the resolution of several lower balance nonperforming assets during 2023.
Total equity was $303.8 million as of December 31, 2023, compared to $296.8 million at September 30, 2023 and $295.6 million at December 31, 2022. The increase from the previous quarter resulted primarily from net income of $5.9 million and a reduction in accumulated other comprehensive loss of $4.2 million due to increases in the fair value of available for sale securities during the period. This was partially offset by the payment of dividends of $2.7 million during the fourth quarter of 2023.
As of
2023
2022
(dollars in thousands)
December 31
September 30
June 30
March 31
December 31
ASSETS
Cash and due from banks
$
47,744
$
47,922
$
47,663
$
59,030
$
52,390
Federal funds sold
36,575
73,275
44,950
95,400
47,275
Interest-bearing deposits
5,205
8,980
4,738
3,695
6,802
Total cash and cash equivalents
89,524
130,177
97,351
158,125
106,467
Securities available for sale
196,195
178,644
166,596
173,744
188,927
Securities held to maturity
404,208
408,308
437,292
476,105
509,008
Loans held for sale
976
2,506
795
1,260
3,156
Loans, net
2,290,881
2,286,163
2,300,882
2,344,240
2,344,245
Accrued interest receivable
13,143
11,307
11,110
10,443
11,555
Premises and equipment, net
57,018
56,712
56,151
55,457
54,291
Other real estate owned
—
—
—
38
38
Cash surrender value of life insurance
42,348
42,096
41,830
38,619
38,404
Core deposit intangible, net
1,418
1,524
1,633
1,746
1,859
Goodwill
32,160
32,160
32,160
32,160
32,160
Other assets
56,920
80,816
60,396
64,350
61,385
Total assets
$
3,184,791
$
3,230,413
$
3,206,196
$
3,356,287
$
3,351,495
LIABILITIES AND EQUITY
Deposits
Noninterest-bearing
$
852,957
$
903,391
$
915,462
$
992,527
$
1,052,144
Interest-bearing
1,780,289
1,754,902
1,687,355
1,630,841
1,629,010
Total deposits
2,633,246
2,658,293
2,602,817
2,623,368
2,681,154
Securities sold under agreements to repurchase
25,172
19,366
20,532
13,338
7,221
Accrued interest and other liabilities
32,242
31,218
30,701
30,125
28,409
Line of credit
4,500
2,000
12,000
—
—
Federal Home Loan Bank advances
140,000
175,000
195,000
340,000
290,000
Subordinated debentures
45,785
47,752
47,719
49,186
49,153
Total liabilities
2,880,945
2,933,629
2,908,769
3,056,017
3,055,937
Equity attributable to Guaranty Bancshares, Inc.
303,300
296,226
296,862
299,700
294,984
Noncontrolling interest
546
558
565
570
574
Total equity
303,846
296,784
297,427
300,270
295,558
Total liabilities and equity
$
3,184,791
$
3,230,413
$
3,206,196
$
3,356,287
$
3,351,495
Quarter Ended
2023
2022
(dollars in thousands, except per share data)
December 31
September 30
June 30
March 31
December 31
STATEMENTS OF EARNINGS
Interest income
$
40,796
$
39,818
$
38,734
$
37,144
$
35,720
Interest expense
16,983
16,516
14,031
11,982
7,362
Net interest income
23,813
23,302
24,703
25,162
28,358
Provision for credit losses
—
—
—
—
2,800
Net interest income after provision for credit losses
23,813
23,302
24,703
25,162
25,558
Noninterest income
4,796
4,939
7,873
4,905
5,122
Noninterest expense
21,402
20,514
20,471
19,967
20,897
Income before income taxes
7,207
7,727
12,105
10,100
9,783
Income tax provision
1,341
1,437
2,529
1,823
1,764
Net earnings
$
5,866
$
6,290
$
9,576
$
8,277
$
8,019
Net loss attributable to noncontrolling interest
12
7
5
4
3
Net earnings attributable to Guaranty Bancshares, Inc.
$
5,878
$
6,297
$
9,581
$
8,281
$
8,022
PER COMMON SHARE DATA
Earnings per common share, basic
$
0.51
$
0.54
$
0.82
$
0.69
$
0.67
Earnings per common share, diluted
0.51
0.54
0.81
0.69
0.67
Cash dividends per common share
0.23
0.23
0.23
0.23
0.22
Book value per common share - end of quarter
26.28
25.64
25.58
25.13
24.70
Tangible book value per common share - end of quarter(1)
23.37
22.72
22.67
22.29
21.85
Common shares outstanding - end of quarter(4)
11,540,644
11,554,094
11,603,167
11,925,357
11,941,672
Weighted-average common shares outstanding, basic
11,536,878
11,568,897
11,735,475
11,939,593
11,938,973
Weighted-average common shares outstanding, diluted
11,589,165
11,619,342
11,756,512
12,012,004
12,048,475
PERFORMANCE RATIOS
Return on average assets (annualized)
0.73
%
0.78
%
1.17
%
1.01
%
0.95
%
Return on average equity (annualized)
7.93
8.43
12.87
11.18
10.88
Net interest margin, fully taxable equivalent (annualized)(2)
3.11
3.02
3.19
3.24
3.57
Efficiency ratio(3)
74.81
72.64
62.84
66.41
62.42
(1) See Reconciliation of non-GAAP Financial Measures table.
(2) Net interest margin on a 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.
For the Years Ended
December 31,
(dollars in thousands, except per share data)
2023
2022
INCOME STATEMENTS
Interest income
$
156,492
$
123,209
Interest expense
59,512
15,380
Net interest income
96,980
107,829
Provision for loan losses
—
2,150
Net interest income after provision for loan losses
96,980
105,679
Noninterest income
22,513
23,485
Noninterest expense
82,354
79,907
Income before income taxes
37,139
49,257
Income tax provision
7,130
8,834
Net earnings
$
30,009
$
40,423
Net loss attributable to noncontrolling interest
28
24
Net earnings attributable to Guaranty Bancshares, Inc.
$
30,037
$
40,447
PER COMMON SHARE DATA
Earnings per common share, basic
$
2.57
$
3.38
Earnings per common share, diluted
2.56
3.34
Cash dividends per common share
0.92
0.88
Book value per common share - end of period
26.28
24.70
Tangible book value per common share - end of period(1)
23.37
21.85
Common shares outstanding - end of period(4)
11,540,644
11,941,672
Weighted-average common shares outstanding, basic
11,693,761
11,980,209
Weighted-average common shares outstanding, diluted
11,738,605
12,092,847
PERFORMANCE RATIOS
Return on average assets
0.92
%
1.24
%
Return on average equity
10.10
13.76
Net interest margin, fully taxable equivalent(2)
3.15
3.54
Efficiency ratio(3)
68.92
60.85
(1) See Reconciliation of non-GAAP Financial Measures table.
(2) Net interest margin on a 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
2023
2022
(dollars in thousands)
December 31
September 30
June 30
March 31
December 31
LOAN PORTFOLIO COMPOSITION
Commercial and industrial
$
287,565
$
292,410
$
295,864
$
295,936
$
314,067
Real estate:
Construction and development
296,639
317,484
345,127
372,203
377,135
Commercial real estate
923,195
901,321
891,883
900,190
887,587
Farmland
186,295
188,614
187,105
190,802
185,817
1-4 family residential
514,603
504,002
496,340
499,944
493,061
Multi-family residential
44,292
42,720
44,385
44,760
45,147
Consumer
57,059
58,294
59,498
60,163
61,394
Agricultural
12,685
13,076
13,447
13,545
13,686
Overdrafts
243
328
252
270
282
Total loans(1)(2)
$
2,322,576
$
2,318,249
$
2,333,901
$
2,377,813
$
2,378,176
Quarter Ended
2023
2022
(dollars in thousands)
December 31
September 30
June 30
March 31
December 31
ALLOWANCE FOR CREDIT LOSSES
Balance at beginning of period
$
31,140
$
31,759
$
31,953
$
31,974
$
29,235
Loans charged-off
(242
)
(644
)
(224
)
(94
)
(103
)
Recoveries
22
25
30
73
42
Provision for credit loss expense
—
—
—
—
2,800
Balance at end of period
$
30,920
$
31,140
$
31,759
$
31,953
$
31,974
Allowance for credit losses / period-end loans
1.33
%
1.34
%
1.36
%
1.34
%
1.34
%
Allowance for credit losses / nonperforming loans
552.9
1,148.2
894.6
238.4
294.7
Net charge-offs / average loans (annualized)
0.04
0.11
0.03
0.00
0.01
NONPERFORMING ASSETS
Nonaccrual loans
$
5,592
$
2,712
$
3,550
$
13,405
$
10,848
Other real estate owned
—
—
—
38
38
Repossessed assets owned
234
250
—
—
—
Total nonperforming assets
$
5,826
$
2,962
$
3,550
$
13,443
$
10,886
Nonperforming assets as a percentage of:
Total loans(1)(2)
0.25
%
0.13
%
0.15
%
0.57
%
0.46
%
Total assets
0.18
0.09
0.11
0.40
0.32
(1) Excludes outstanding balances of loans held for sale of $976,000, $2.5 million, $795,000, $1.3 million, and $3.2 million as of December 31, September 30, June 30 and March 31, 2023, and December 31, 2022, respectively.
(2) Excludes deferred loan fees of $775,000, $946,000, $1.3 million, $1.6 million, and $2.0 million as of December 31, September 30, June 30 and March 31, 2023, and December 31, 2022, respectively.
Quarter Ended
2023
2022
(dollars in thousands)
December 31
September 30
June 30
March 31
December 31
NONINTEREST INCOME
Service charges
$
1,123
$
1,131
$
1,056
$
1,077
$
1,096
Net realized gain (loss) on securities transactions
—
—
(322
)
93
172
Net realized gain on sale of loans
196
218
473
314
310
Fiduciary and custodial income
624
637
630
638
642
Bank-owned life insurance income
249
267
211
214
209
Merchant and debit card fees
1,760
1,752
2,121
1,674
1,711
Loan processing fee income
116
128
142
134
150
Mortgage fee income
30
46
50
68
81
Other noninterest income
698
760
3,512
693
751
Total noninterest income
$
4,796
$
4,939
$
7,873
$
4,905
$
5,122
NONINTEREST EXPENSE
Employee compensation and benefits
$
12,715
$
11,944
$
11,939
$
12,264
$
12,364
Occupancy expenses
2,757
2,960
2,754
2,830
2,770
Legal and professional fees
954
902
985
583
779
Software and technology
1,740
1,490
1,531
1,396
1,525
Amortization
145
147
149
161
161
Director and committee fees
186
192
201
199
199
Advertising and promotions
352
288
269
267
488
ATM and debit card expense
763
803
739
599
740
Telecommunication expense
175
178
171
183
193
FDIC insurance assessment fees
321
363
522
301
359
Other noninterest expense
1,294
1,247
1,211
1,184
1,319
Total noninterest expense
$
21,402
$
20,514
$
20,471
$
19,967
$
20,897
Quarter Ended December 31,
2023
2022
(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)
$
2,329,227
$
35,573
6.06
%
$
2,305,688
$
30,189
5.19
%
Securities available for sale
187,119
1,540
3.27
202,829
1,478
2.89
Securities held to maturity
406,553
2,619
2.56
574,951
3,222
2.22
Nonmarketable equity securities
26,314
264
3.98
24,291
377
6.16
Interest-bearing deposits in other banks
56,207
800
5.65
49,422
454
3.64
Total interest-earning assets
3,005,420
40,796
5.39
3,157,181
35,720
4.49
Allowance for credit losses
(30,996
)
(29,634
)
Noninterest-earning assets
223,204
218,811
Total assets
$
3,197,628
$
3,346,358
LIABILITIES AND EQUITY
Interest-bearing liabilities:
Interest-bearing deposits
$
1,788,863
$
14,311
3.17
%
$
1,627,442
$
4,433
1.08
%
Advances from FHLB and fed funds purchased
140,761
1,915
5.40
240,489
2,408
3.97
Line of credit
4,255
95
8.86
—
—
—
Subordinated debt
46,438
534
4.56
49,806
514
4.09
Securities sold under agreements to repurchase
23,860
128
2.13
7,634
7
0.36
Total interest-bearing liabilities
2,004,177
16,983
3.36
1,925,371
7,362
1.52
Noninterest-bearing liabilities:
Noninterest-bearing deposits
865,817
1,102,016
Accrued interest and other liabilities
33,496
26,500
Total noninterest-bearing liabilities
899,313
1,128,516
Equity
294,138
292,471
Total liabilities and equity
$
3,197,628
$
3,346,358
Net interest rate spread(2)
2.03
%
2.97
%
Net interest income
$
23,813
$
28,358
Net interest margin(3)
3.14
%
3.56
%
Net interest margin, fully taxable equivalent(4)
3.11
%
3.57
%
(1) Includes average outstanding balances of loans held for sale of $799,000 and $1.5 million for the quarter ended December 31, 2023 and 2022, 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 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%.
Year Ended December 31,
2023
2022
(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)
$
2,352,154
$
136,086
5.79
%
$
2,126,810
$
104,503
4.91
%
Securities available for sale
182,277
5,159
2.83
287,764
5,808
2.02
Securities held to maturity
449,097
11,210
2.50
518,213
10,789
2.08
Nonmarketable equity securities
27,371
1,288
4.71
18,791
1,246
6.63
Interest-bearing deposits in other banks
51,507
2,749
5.34
121,609
863
0.71
Total interest-earning assets
3,062,406
156,492
5.11
3,073,187
123,209
4.01
Allowance for credit losses
(31,601
)
(29,415
)
Noninterest-earning assets
220,230
216,812
Total assets
$
3,251,035
$
3,260,584
LIABILITIES AND EQUITY
Interest-bearing liabilities:
Interest-bearing deposits
$
1,698,758
$
44,981
2.65
%
$
1,670,287
$
9,753
0.58
%
Advances from FHLB and fed funds purchased
226,214
11,626
5.14
132,764
3,855
2.90
Line of credit
4,168
363
8.71
—
34
—
Subordinated debt
47,873
2,143
4.48
46,977
1,722
3.67
Securities sold under agreements to repurchase
20,635
399
1.93
8,596
16
0.19
Total interest-bearing liabilities
1,997,648
59,512
2.98
1,858,624
15,380
0.83
Noninterest-bearing liabilities:
Noninterest-bearing deposits
924,945
1,082,513
Accrued interest and other liabilities
30,924
25,537
Total noninterest-bearing liabilities
955,869
1,108,050
Equity
297,518
293,910
Total liabilities and equity
$
3,251,035
$
3,260,584
Net interest rate spread(2)
2.13
%
3.18
%
Net interest income
$
96,980
$
107,829
Net interest margin(3)
3.17
%
3.51
%
Net interest margin, fully taxable equivalent(4)
3.15
%
3.54
%
(1) Includes average outstanding balances of loans held for sale of $1.2 million and $2.4 million for the years ended December 31, 2023 and 2022, 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.
(4) Net interest margin on a taxable equivalent basis is equal to net interest income adjusted for nontaxable income divided by average interest-earning assets, using a marginal tax rate of 21%.
NON-GAAP RECONCILING TABLES
Tangible Book Value per Common Share
As of
2023
2022
(dollars in thousands, except per share data)
December 31
September 30
June 30
March 31
December 31
Equity attributable to Guaranty Bancshares, Inc.
$
303,300
$
296,226
$
296,862
$
299,700
$
294,984
Adjustments:
Goodwill
(32,160
)
(32,160
)
(32,160
)
(32,160
)
(32,160
)
Core deposit intangible, net
(1,418
)
(1,524
)
(1,633
)
(1,746
)
(1,859
)
Total tangible common equity attributable to Guaranty Bancshares, Inc.
$
269,722
$
262,542
$
263,069
$
265,794
$
260,965
Common shares outstanding(1)
11,540,644
11,554,094
11,603,167
11,925,357
11,941,672
Book value per common share
$
26.28
$
25.64
$
25.58
$
25.13
$
24.70
Tangible book value per common share(1)
23.37
22.72
22.67
22.29
21.85
(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 % of Total Equity
(dollars in thousands)
December 31, 2023
Total equity(1)
$
303,846
Less: net unrealized loss on HTM securities, tax effected
(23,451
)
Total equity, including net unrealized loss on AFS and HTM securities
$
280,395
Net unrealized loss on AFS securities, tax effected
15,156
Net unrealized loss on HTM securities, tax effected
23,451
Net unrealized loss on AFS and HTM securities, tax effected
$
38,607
Net unrealized loss on securities as % of total equity(1)
12.7
%
Total equity before impact of unrealized losses
$
319,002
Net unrealized loss on securities as % of total equity before impact of unrealized losses
12.1
%
Total average assets
$
3,197,628
Total equity to average assets
9.5
%
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 $15,156.
Cost of Total Deposits
Quarter Ended
(dollars in thousands)
December 31, 2023
September 30, 2023
December 31, 2022
Total average interest-bearing deposits
$
1,788,863
$
1,726,218
$
1,627,442
Adjustments:
Noninterest-bearing deposits
865,817
888,772
1,102,016
Total average deposits
$
2,654,680
$
2,614,990
$
2,729,458
Total deposit-related interest expense
$
14,311
$
13,069
$
4,433
Average cost of interest-bearing deposits
3.17
%
3.00
%
1.08
%
Average cost of total deposits
2.14
1.98
0.64
About Non-GAAP Financial Measures
Certain of the financial measures and ratios we present, including “tangible book value per 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 fourth quarter 2023 financial results on Tuesday, January 16, 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 January 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 December 31, 2023, Guaranty Bancshares, Inc. had total assets of $3.2 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, other risks and uncertainties listed from time to time in our reports and documents filed with the Securities and Exchange Commission ("SEC"). 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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240116931859/en/
Shalene Jacobson Executive Vice President and Chief Financial Officer Guaranty Bancshares, Inc. (888) 572-9881 investors@gnty.com
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