0001050441☐00010504412023-10-252023-10-25

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 25, 2023
 
EAGLE BANCORP, INC.
(Exact name of registrant as specified in its charter)
 
Maryland0-2592352-2061461
(State or Other Jurisdiction of Incorporation)(Commission File Number)(I.R.S. Employer Identification No.)
7830 Old Georgetown Road, Third Floor
Bethesda, Maryland 20814
(Address of Principal Executive Offices) (Zip Code)
(301) 986-1800
(Registrant's telephone number, including area code)

(Former name or former address, if changed since last report)
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.01 par valueEGBN
The Nasdaq Stock Market LLC
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company,indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


The information contained in this Current Report on Form 8-K that is furnished under this Item 2.02, including the accompanying Exhibit 99.1, is being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section. The information contained in this Current Report on Form 8-K that is furnished under this Item 2.02, including the accompanying Exhibit 99.1, shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such a filing.
Item 2.02. Results of Operations and Financial Condition.
 
On October 25, 2023, the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
 
Item 9.01. Financial Statements and Exhibits.
 
(d) Exhibits.
 
Exhibit Number Description
   
 Press Release dated October 25, 2023
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)




SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 EAGLE BANCORP, INC.
   
  
Date: October 25, 2023By:/s/ Eric R. Newell        
  Eric R. Newell
  Executive Vice President, Chief Financial Officer




imagea.jpg
PRESS RELEASE FOR
EAGLE BANCORP, INC.
IMMEDIATE RELEASECONTACT:
David G. Danielson
October 25, 2023
240.552.9534
EAGLE BANCORP, INC. ANNOUNCES NET INCOME FOR
THIRD QUARTER 2023 OF $27.4 MILLION OR $0.91 PER DILUTED SHARE
BETHESDA, MD, Eagle Bancorp, Inc. (the "Company") (NASDAQ: EGBN), the parent company of EagleBank (the "Bank"), today announced net income of $27.4 million for the third quarter 2023, compared to net income of $28.7 million for the second quarter 2023 (the "prior quarter") and $37.3 million for the third quarter 2022 (the "year-ago quarter"). Net income (basic and diluted) was $0.91 per share for the third quarter 2023, compared to $0.94 per share for the prior quarter, and $1.16 per share for the year-ago quarter.
The $1.3 million decrease in earnings from the prior quarter was attributable to several items including lower noninterest income as the prior quarter included nonrecurring recognition of income from a Small Business Investment Company ("SBIC") investment, lower net interest income as the cost of interest bearing liabilities outpaced income on interest-earning assets, and a reversal of $1.6 million of interest income because of a loan entering nonperforming status in the quarter.
Susan G. Riel, President and Chief Executive Officer of the Company commented, "The Company's steady performance this quarter was the result of continued efforts of the EagleBank team to offer our customers the products and services they need to run their businesses. As a result, our earnings and margin, absent the reversal of interest income, continued to stabilize. Additionally, our funding mix improved with deposit inflows and paydowns of short-term debt, and our asset quality metrics and regulatory capital ratios remain strong.
"The EagleBank team is working diligently to position the Company's balance sheet to enable appropriate diversification of assets and loans, and is building capabilities to drive core deposit growth. These strategies will position the Company for future sustainable growth and an enhanced earnings profile. I am excited about the future of EagleBank and its ability to serve our communities and customers through the successful execution of these strategies.
"We once again thank all of our employees for their commitment in serving the needs of our clients and communities. Additionally, we remain committed to a culture of respect, diversity and inclusion in both the workplace and the communities we serve."

Third Quarter 2023 Highlights
•The funding mix continued to improve as deposits at quarter-end were $8.4 billion, up $658 million, or 8.5%, from the prior quarter-end, and short-term borrowings declined $537 million, or 29.2%, ending at $1.3 billion. The increase in deposits was primarily from growth in savings and money market and time deposits. Brokered deposits were down $38 million, declining to 29.1% of deposits at quarter-end, from 32.1% a quarter ago. The decrease in borrowings was from
1




repayment of all Federal Home Loan Bank ("FHLB") borrowings. Remaining short-term borrowings at quarter-end were entirely from the Bank Term Funding Program ("BTFP"), which remained unchanged from the prior quarter-end.
•The net interest margin ("NIM") was 2.43% for the third quarter 2023, compared to 2.49% for the prior quarter. The reversal of $1.6 million of interest income, reduced the NIM by 6 basis points.
•The Company declared a quarterly dividend of $0.45 per share.
•At quarter-end, the common equity and tangible common equity ratios were 10.89% and 10.04%1, respectively.
•Loans at quarter-end were $7.9 billion, up $150 million, or 1.9%, from the prior quarter-end. This was the eighth consecutive quarterly increase.
•Nonperforming assets as a percentage of total assets was 0.64% and the net charge-off (annualized) for the quarter was 0.02% of average total loans.
•The provision for credit losses was $5.6 million for the quarter, as compared to $5.2 million the prior quarter. The allowance for credit losses as a percent of total loans was 1.05% at quarter-end; up from 1.00% a quarter ago.
•Total estimated uninsured deposits at September 30, 2023 were $2.5 billion2, or 29.6% of deposits.

(Dollars in thousands, except per share data)As of or for the Three Months EndedPercent Change
Sept. 30,
June 30,
Sept. 30,Q3-23Q3-23
202320232022vs. Q2-23vs. Q3-22
Earnings and Per Share Data
Net Income
$27,383 $28,692 $37,297 (4.6)%(26.6)%
Earnings per common share (diluted)
$0.91 $0.94 $1.16 (2.8)%(21.2)%
Dividend per common share
$0.45 $0.45 $0.45 
Return Ratios
Return on average assets0.91 %0.96 %1.29 %
Return on average common equity8.80 %9.24 %11.64 %
Return on average tangible common equity1
9.61 %10.08 %12.67 %
Net interest margin2.43 %2.49 %3.02 %
Efficiency ratio1
48.8 %47.2 %40.6 %
Balance Sheet
Assets$11,164 $11,035 $10,713 1.2 %4.2 %
Loans$7,916 $7,767 $7,304 1.9 %8.4 %
Deposits$8,376 $7,718 $8,763 8.5 %(4.4)%
Borrowings$1,370 $1,907 $585 (28.2)%134.3 %
Book and Tangible Book
Book value per common share
$40.64 $40.78 $38.02 (0.3)%6.9 %
Tangible book per common share1
$37.12 $37.29 $34.77 (0.5)%6.8 %
1 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the tables that accompany this document.
2 Estimated amount of uninsured deposits to be reported on line RCON5597 of schedule RC-O in the Bank's September 30, 2023 Call Report.
2




(Dollars in thousands, except per share data)As of or for the Three Months EndedPercent Change
Sept. 30,
June 30,
Sept. 30,Q3-23Q3-23
202320232022vs. Q2-23vs. Q3-22
Capital Ratios
Equity/assets10.89 %11.05 %11.39 %
Tangible equity/assets10.04 %10.21 %10.52 %
Total capital (to risk weighted assets)14.54 %14.51 %15.60 %
Asset Quality
Allowance for credit losses to total loans1.05 %1.00 %1.04 %
Nonperforming assets ("NPAs") to total assets0.64 %0.28 %0.09 %
Net charge-off to average loans (annualized)0.02 %0.29 %— %

Income Statement

•Net interest income was $70.7 million for the third quarter 2023, compared to $71.8 million for the prior quarter and $83.9 million for the year-ago quarter. The decrease in net interest income from the prior quarter was primarily driven by the continued shift of deposit balances by customers from noninterest bearing demand deposits to interest bearing accounts. Loan interest income increased despite the reversal of $1.6 million of interest income because of a loan entering nonperforming status in the quarter.

•Net interest margin ("NIM") was 2.43% for the third quarter 2023, compared to 2.49% for the prior quarter and 3.02% for the year-ago quarter. The reversal of $1.6 million of interest income, reduced the NIM by 6 basis points.
◦The yield on the loan portfolio was 6.73% for the third quarter 2023, compared to 6.64% for the prior quarter and 5.10% for the year-ago quarter. The increase of 9 basis points from the prior quarter was from variable rate loans adjusting upward and from higher rates on newly originated loans, offset by the reversal of $1.6 million of interest income. The reversal of interest income reduced the yield on the loan portfolio by 8 basis points.
◦The cost of funds was 3.39% for third quarter 2023, compared to 3.20% for the prior quarter and 1.09% for the year-ago quarter.3 The increase of 19 basis points from the prior quarter was primarily due to the impact of higher interest rates paid on deposits along with a continued shift in noninterest bearing deposit accounts to interest bearing deposit accounts.
•Pre-provision net revenue ("PPNR"),4 a non-GAAP measure, was $39.4 million, or 1.31% of average assets for the third quarter 2023, down from $42.4 million and 1.43%, respectively. This decrease from the prior quarter in both PPNR and PPNR as a percent of average assets was primarily attributable to the prior quarter including nonrecurring Small Business Investment Company ("SBIC") income in noninterest income.

3 Beginning in the second quarter of 2023, the Company revised its methodology for calculating cost of funds. Prior periods have been conformed to the current presentation. See footnote (3) on page 14.
4 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the table below.
3




(Dollars in thousands)Three Months EndedPercent Change
Sept. 30,
June 30,
Sept. 30,Q3-23Q3-23
202320232022vs. Q2-23vs. Q3-22
Net interest income$70,719 $71,811 $83,897 (1.5)%(15.7)%
Noninterest income6,347 8,595 5,308 (26.2)%19.6 %
Noninterest expense(37,633)(37,978)(36,206)(0.9)%3.9 %
PPNR (non-GAAP)$39,433 $42,428 $52,999 (7.1)%(25.6)%
Average Assets$11,942,905 $11,960,111 $11,431,110 (0.1)%4.5 %
As a Percent of Average AssetsBasis Point Change
Net interest income2.35 %2.41 %2.91 %(6) bps(56) bps
Noninterest income0.21 %0.29 %0.18 %(8) bps3 bps
Noninterest expense(1.25)%(1.27)%(1.26)%2 bps1 bps
PPNR to Average Assets (non-GAAP)1.31 %1.43 %1.83 %(12) bps(52) bps

•Provision for credit losses on loans was $5.6 million for the third quarter 2023, compared to $5.2 million for the prior quarter and $3.0 million for the year-ago quarter. The increase in the third quarter 2023 provision over the prior quarter was primarily driven by increases in qualitative reserves combined with a smaller increase in the quantitative reserve. The increase in qualitative reserves was driven by increases in early-stage past dues and perceived weakness in the commercial real estate ("CRE") market. The increase in quantitative reserve was primarily due to loan growth during the quarter, particularly in longer-life categories that carry corresponding higher reserves as well as slowing prepayment speeds in certain loan categories due to higher interest rates, partly offset by modest improvements in the unemployment forecast.

•Noninterest income was $6.3 million for the third quarter 2023, as compared to $8.6 million for the prior quarter and $5.3 million for the year-ago quarter. The primary driver for the decrease in the third quarter 2023 from the prior quarter was the prior quarter included nonrecurring income of $2.8 million from an SBIC fund.

•Noninterest expense was $37.6 million for the third quarter 2023 compared to $38.0 million for the prior quarter and $36.2 million for the year-ago quarter. Noninterest expense was down $345 thousand from the prior quarter, primarily due to lower overall expenses offset by higher FDIC fees, which were up $761 thousand from the prior quarter on higher assessment fees.

•Efficiency ratio5 was 48.8% for the third quarter 2023, compared to 47.2% for the prior quarter.

•Effective income tax rate for the third quarter 2023 was 20.9%, compared to 22.2% for the prior quarter. The decrease in the effective tax rate this quarter was primarily driven by a reduction in the permanent tax adjustment for compensation to covered employees.

Balance Sheet
•Total assets were $11.2 billion at September 30, 2023, up 1.2% from a quarter ago and up 4.2% from a year ago. The increase in assets from a quarter ago was primarily from an increase in loans and interest bearing deposits with banks and other short-term investments, offset by lower balances on investment securities.

5 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the tables that accompany this document.
4




•Investment securities had a balance of $2.5 billion at September 30, 2023, down 3.2% from a quarter ago and down 9.3% from a year ago. The decrease from the prior quarter-end was primarily from principal paydowns, maturities received and lower fair values on AFS securities. No new investments were purchased during the third quarter of 2023.
Investment securities held-to-maturity had a fair value that was $160 million less than carrying value at quarter-end, compared to a difference of $132 million a quarter ago. The decrease in fair values from the prior quarter-end were primarily from the impact of the increasing interest rate environment on market valuations.
•Total loans (excluding loans held for sale) were $7.9 billion at September 30, 2023, up 1.9% from a quarter ago and up 8.4% from a year ago. The increase in total loans from the prior quarter-end was driven by growth in CRE loans (income producing and owner occupied) and construction loans for commercial and residential properties as period-end balances for commercial & industrial loans were down.
At September 30, 2023, income-producing commercial real estate loans secured by office properties other than owner-occupied properties ("CRE office loans") were 12.0% of the total loan portfolio. Our CRE office loans are primarily located in the Washington DC market; with 24.5% in the District of Columbia, 33.9% in Washington's Maryland suburbs, 34.0% in Northern Virginia, and 7.6% located outside these markets.

(Dollars in thousands)
Sept. 30, 2023
June 30, 2023
Sept. 30, 2022
Amount%Amount%Amount%
Loan Balances - Period End:
Commercial and Industrial$1,418,760 18 %$1,431,284 18 %$1,415,998 19 %
PPP loans588 — %649 — %7,241 — %
Commercial real estate - income producing4,147,301 52 %4,086,049 53 %3,668,720 50 %
Commercial real estate - owner occupied1,182,959 15 %1,122,334 14 %1,091,283 15 %
1-4 Family mortgage76,511 1 %76,596 1 %71,731 1 %
Construction - commercial and residential904,282 11 %862,869 11 %858,100 12 %
Construction - C&I (owner occupied)129,616 2 %132,843 2 %139,238 2 %
Home equity53,917 1 %53,934 1 %51,396 1 %
Other consumer2,457 — %161 — %791 — %
Total loans$7,916,391 100 %$7,766,719 100 %$7,304,498 100 %

•Allowance for credit losses was 1.05% of total loans at September 30, 2023, compared to 1.00% a quarter ago, and 1.04% a year ago. See commentary above in section "Provision for Credit Losses on Loans."
Net charge-off was $340 thousand for the quarter, which as a percent of average loans (excluding loans held for sale)6 was 0.02% for the third quarter 2023, compared to 0.29% a quarter ago, and net recovery of less than 0.01% the year-ago quarter. Charge-offs for the third quarter 2023 were related to three SBA loans.
•Nonperforming loans and assets were $70.4 million and $71.9 million, respectively, at September 30, 2023.
◦Nonperforming loans ("NPLs") as a percent of loans were 0.89% at September 30, 2023, compared to 0.37% a quarter ago and 0.10% a year ago. The increase from a quarter ago was primarily from the addition of one multi-family credit in the District of Columbia.
6 Net charge-offs as a percent of average loans (excluding loans held for sale) are shown on an annualized basis.
5




◦Nonperforming assets ("NPAs") as a percent of assets were 0.64% at September 30, 2023, compared to 0.28% a quarter ago and 0.09% a year ago. The increase in NPAs from the prior quarter are related to the same NPL discussed above. At quarter end, other real estate owned consisted of three properties with an aggregate value of $1.5 million.
◦Loans 30-89 days late were $46.5 million at September 30, 2023, up from $41.0 million a quarter ago and $16.2 million a year ago. The increase from the prior quarter was primarily from one office property in northern Virginia and one assisted living facility in Maryland, offset by the migration of the multi-family credit to nonperforming.

(Dollars in thousands)Three Months Ended or As Of
Sept. 30,June 30,Sept. 30,
202320232022
Asset Quality:
Net charge-off (recovery)$340 $5,598 $(57)
Nonperforming loans$70,418 $29,098 $7,601 
Other real estate owned$1,487 $1,487 $1,962 
Nonperforming assets$71,905 $30,585 $9,563 
Special mention
$158,182 $155,810 $106,672 
Substandard
$219,001 $219,045 $89,724 

•Total deposits were $8.4 billion at September 30, 2023, up 8.5% from a quarter ago and down 4.4% from a year ago. The increase from the prior quarter-end was primarily attributable to an increase in savings/money market and time deposits. Brokered deposits were 29.1% of deposits at quarter-end, down from 32.1% a quarter ago. The decrease in brokered funds as a percent of deposits was from both the increase in total deposits and a decline in brokered demand deposits. The increase in deposits lowered the loan-to-deposit ratio to 95% at September 30, 2023, down from 101% a quarter ago.
For the quarter, average noninterest bearing deposits to average total deposits was 25.1% for the third quarter 2023, down from 30.1% a quarter ago and down from 38.4% for the year-ago quarter.
Total estimated uninsured deposits at September 30, 2023 were $2.5 billion7, or 29.6% of deposits.
•Other short-term borrowings were $1.3 billion at September 30, 2023, down from $1.8 billion a quarter ago, and up from $515 million a year ago. The decrease in borrowings of $537 million from a quarter ago was primarily driven by the pay down of all FHLB borrowings enabled by the increase in deposits. BTFP borrowings were $1.3 billion at September 30, 2023, unchanged from the prior quarter, with a rate of 4.53% for a term of up to one year from the date the proceeds were borrowed.
As of September 30, 2023, the Company had aggregate available borrowing capacity of $2.3 billion, which includes $2.0 billion in additional aggregate capacity to borrow with the FHLB and BTFP on assets that have been pledged and unencumbered securities totaling approximately $270 million available for pledging to the FHLB or BTFP.
•Total shareholders’ equity was $1.2 billion at September 30, 2023, down 0.3% from a quarter ago, and down 0.3% from a year ago. The decrease in shareholders' equity of $3.9 million from the prior quarter-end was primarily from lower valuations of AFS securities and dividends declared, partially offset by net income.
7 Estimated amount of uninsured deposits to be reported on line RCON5597 of schedule RC-O in the Bank's September 30, 2023 Call Report.
6




◦Book value per share was $40.64, down $0.14 from a quarter ago, and up $2.62 from a year ago.
◦Tangible book value per share8 was $37.12, down $0.17 from a quarter ago, and up $2.35 from a year ago.
•Dividends: On September 27, 2023, the Board of Directors declared a quarterly cash dividend of $0.45 per share payable on October 31, 2023 to shareholders of record on October 20, 2023.
•Stock Repurchases: There were no stock repurchases during the third quarter as the 2023 Stock Repurchase Plan was completed in the second quarter of 2023.
•Capital ratios for the Company are in the table below. Regulatory capital ratios for the Company continue to be strong and in excess of the regulatory requirements (inclusive of applicable buffers).

For the CompanyRegulatory
Sept. 30,June 30,Sept. 30,Capital
2023920232022Requirements
Regulatory Capital Ratios
Total Capital (to risk weighted assets)14.54 %14.52 %15.60 %10.50 %
Tier 1 Capital (to risk weighted assets)13.68 %13.55 %14.64 %8.50 %
Common Equity Tier 1 (to risk weighted assets)13.68 %13.55 %14.64 %7.00 %
Tier 1 Capital (to average assets)10.96 %10.84 %11.55 %4.00 %
Common Capital Ratios
Common Equity Ratio10.89 %11.05 %11.39 %— 
Tangible Common Equity Ratio8
10.04 %10.21 %10.52 %— 

Additional financial information: The financial information that follows provides more detail on the Company’s financial performance for the three months ended September 30, 2023 as compared to the three months ended June 30, 2023 and September 30, 2022, as well as eight quarters of trend data. Persons wishing additional information should refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, and other reports filed with the SEC.
About Eagle Bancorp: The Company is the holding company for EagleBank, which commenced operations in 1998. The Bank is headquartered in Bethesda, Maryland, and operates through thirteen banking offices and four lending offices, located in Suburban Maryland, Washington, D.C. and Northern Virginia. The Company focuses on building relationships with businesses, professionals and individuals in its marketplace, and is committed to a culture of respect, diversity, equity and inclusion in both its workplace and the communities in which it operates.

Conference call: Eagle Bancorp will host a conference call to discuss its third quarter 2023 financial results on Thursday, October 26, 2023 at 10:00 a.m. eastern time.
The listen-only webcast can be accessed at:
https://edge.media-server.com/mmc/p/iffrccgu/
For analysts who wish to participate in the conference call, please register at the following URL:
https://register.vevent.com/register/BIab5af7f55cc3442a8257605b6478c064
A replay of the conference call will be available on the Company’s website through November 9, 2023: https://www.eaglebankcorp.com/
8 A reconciliation of non-GAAP financial measures to the nearest GAAP measure is provided in the tables that accompany this document.
9 Capital ratios for September 30, 2023 are subject to final filings with the Federal Reserve.
7

Forward-looking statements: This press release contains forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended, including statements of goals, intentions, and expectations as to future trends, plans, events or results of Company operations and policies and regarding general economic conditions. In some cases, forward-looking statements can be identified by use of words such as "may," "will," "can," "anticipates," "believes," "expects," "plans," "estimates," "potential," "continue," "should," "could," "strive," "feel" and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company’s market (including volatility in interest rates and interest rate policy; the current high inflationary environment; competitive factors) and other conditions (such as the impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general on investor and depositor sentiment regarding the stability and liquidity of banks), which by their nature are not susceptible to accurate forecast and are subject to significant uncertainty. Because of these uncertainties and the assumptions on which this discussion and the forward-looking statements are based, actual future operations and results in the future may differ materially from those indicated herein. For details on factors that could affect these expectations, see the risk factors and other cautionary language included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 and in other periodic and current reports filed with the SEC. Readers are cautioned against placing undue reliance on any such forward-looking statements. The Company’s past results are not necessarily indicative of future performance, and nothing contained herein is meant to or should be considered and treated as earnings guidance of future quarters’ performance projections. Information regarding the Company’s uninsured deposits consists of preliminary estimates, which are forward-looking statements and subject to change, possibly materially, as the Bank completes its third quarter 2023 Call Report. All information is as of the date of this press release. Any forward-looking statements made by or on behalf of the Company speak only as to the date they are made. Except to the extent required by applicable law or regulation, the Company undertakes no obligation to revise or update publicly any forward-looking statement for any reason.



8


GAAP Reconciliation (unaudited)
(dollars in thousands, except per share data)
September 30,June 30,September 30,
202320232022
Tangible equity and assets
  Common shareholders' equity
$1,215,884 $1,219,766 $1,219,771 
  Less: Intangible assets
(105,239)(104,220)(104,240)
  Tangible common equity
$1,110,645 $1,115,546 $1,115,531 
  Book value per common share
$40.64 $40.78 $38.02 
  Less: Intangible book value per common share
(3.52)(3.49)(3.25)
  Tangible book value per common share
$37.12 $37.29 $34.77 
  Shares outstanding period end
29,917,982 29,912,082 32,082,321 
  Total assets
$11,164,214 $11,034,741 $10,713,044 
  Less: Intangible assets
(105,239)(104,220)(104,240)
  Tangible assets
$11,058,975 $10,930,521 $10,608,804 
  Tangible common equity ratio
10.04 %10.21 %10.52 %
Three Months Ended
September 30,June 30,September 30,
202320232022
Average tangible common equity
  Average common shareholders' equity$1,235,162 $1,245,647 $1,271,753 
  Less: Average intangible assets (104,639)(104,224)(104,253)
  Average tangible common equity$1,130,523 $1,141,423 $1,167,500 
Return on Average Tangible Common Equity9.61 %10.08 %12.67 %
Efficiency ratio
  Net interest income$70,719 $71,811 $83,897 
  Noninterest income6,347 8,595 5,308 
  Operating revenue$77,066 $80,406 $89,205 
  Noninterest expense$37,633 $37,978 $36,206 
  Efficiency ratio48.8 %47.2 %40.6 %



9


GAAP Reconciliation - Notes

Tangible common equity to tangible assets (the "tangible common equity ratio"), tangible book value per common share, average tangible common equity, and the return on average tangible common equity are non-GAAP financial measures derived from GAAP based amounts. The Company calculates the tangible common equity ratio by excluding the balance of intangible assets from common shareholders' equity and dividing by tangible assets. The Company calculates tangible book value per common share by dividing tangible common equity by common shares outstanding, as compared to book value per common share, which the Company calculates by dividing common shareholders' equity by common shares outstanding. The Company calculates the annualized return on average tangible common equity ratio by dividing net income available to common shareholders by average tangible common equity, which is calculated by excluding the average balance of intangible assets from the average common shareholders’ equity. The Company considers this information important to shareholders as tangible equity is a measure that is consistent with the calculation of capital for bank regulatory purposes, which excludes intangible assets from the calculation of risk based ratios, and as such is useful for investors, regulators, management and others to evaluate capital adequacy and to compare against other financial institutions. The above tables provide reconciliations of these financial measures defined by GAAP with non-GAAP financial measures.
Efficiency ratio is a non-GAAP measure calculated by dividing GAAP non-interest expense by the sum of GAAP net interest income and GAAP non-interest (loss) income. The Company believes that reporting the non-GAAP efficiency ratio more closely measures its effectiveness of controlling operational activities. The table above shows the calculation of the efficiency ratio from these GAAP measures.
PPNR is a non-GAAP financial measure derived from GAAP based amounts. The Company calculates PPNR by subtracting noninterest expenses from the sum of net interest income and noninterest income. PPNR to Average Assets is calculated by dividing the PPNR amount by average assets to obtain a percentage. The Company considers this information important to shareholders because it illustrates revenue excluding the impact of provisions and reversals to the allowance for credit losses on loans. The table in the "Income Statement" section of this earnings release provides a reconciliation of the nearest GAAP measure to PPNR and PPNR to Average Assets.

10

Eagle Bancorp, Inc.
Consolidated Balance Sheets (Unaudited)
(Dollars in thousands, except per share data)
September 30,June 30,September 30,
Assets202320232022
Cash and due from banks$8,625 $9,865 $27,235 
Federal funds sold13,611 3,981 69,809 
Interest-bearing deposits with banks and other short-term investments235,819 174,072 47,131 
Investment securities available-for-sale at fair value (amortized cost of $1,700,233, $1,732,722, and $1,873,872, net of allowance for credit losses of $17, $17 and $18 as of September 30, 2023, June 30, 2023 and September 30, 2022, respectively)
1,474,945 1,535,589 1,649,753 
Investment securities held-to-maturity at amortized cost, net of allowance for credit losses of $2,010, $2,010 and $802 (fair value of $872,710, $923,313 and $989,001, as of September 30, 2023, June 30, 2023 and September 30, 2022, respectively)
1,032,485 1,055,181 1,114,084 
Federal Reserve and Federal Home Loan Bank stock25,689 46,199 42,311 
Loans held for sale— — 9,387 
Loans7,916,391 7,766,719 7,304,498 
Less allowance for credit losses(83,332)(78,029)(75,767)
Loans, net7,833,059 7,688,690 7,228,731 
Premises and equipment, net11,216 11,979 13,684 
Operating lease right-of-use assets20,151 21,580 26,022 
Deferred income taxes98,987 92,574 112,904 
Bank-owned life insurance112,234 111,565 110,678 
Goodwill and intangible assets, net105,239 104,220 104,240 
Other real estate owned1,487 1,487 1,962 
Other assets190,667 177,759 155,113 
Total assets$11,164,214 $11,034,741 $10,713,044 
Liabilities and Shareholders' Equity
Deposits:
Noninterest bearing demand$2,072,665 $2,010,353 $2,928,774 
Interest bearing transaction932,779 930,308 964,567 
Savings and money market3,129,773 2,791,040 4,220,768 
Time deposits2,241,089 1,986,426 649,241 
Total deposits8,376,306 7,718,127 8,763,350 
Customer repurchase agreements25,689 37,017 21,465 
Other short-term borrowings1,300,001 1,836,759 515,000 
Long-term borrowings69,887 69,856 69,763 
Operating lease liabilities24,422 26,007 30,837 
Reserve for unfunded commitments6,183 7,023 5,696 
Other liabilities145,842 120,186 87,162 
Total liabilities9,948,330 9,814,975 9,493,273 
Shareholders' Equity
Common stock, par value $.01 per share; shares authorized 100,000,000, shares issued and outstanding 29,917,982, 29,912,082, and 32,082,321 respectively
296 296 318 
Additional paid in capital372,394 370,278 442,880 
Retained earnings1,054,699 1,040,779 987,212 
Accumulated other comprehensive loss(211,505)(191,587)(210,639)
Total Shareholders' Equity1,215,884 1,219,766 1,219,771 
Total Liabilities and Shareholders' Equity$11,164,214 $11,034,741 $10,713,044 
11

Eagle Bancorp, Inc.
Consolidated Statements of Income (Unaudited)
(Dollars in thousands, except per share data)
Three Months Ended
September 30June 30,September 30,
202320232022
Interest Income
Interest and fees on loans$132,273 $128,993 $93,744 
Interest and dividends on investment securities13,732 14,241 13,463 
Interest on balances with other banks and short-term investments
15,067 13,229 4,100 
Interest on federal funds sold77 47 220 
Total interest income161,149 156,510 111,527 
Interest Expense
Interest on deposits70,929 59,422 26,125 
Interest on customer repurchase agreements311 333 55 
Interest on other short-term borrowings18,152 23,907 412 
Interest on long-term borrowings1,038 1,037 1,038 
Total interest expense90,430 84,699 27,630 
Net Interest Income70,719 71,811 83,897 
Provision for Credit Losses5,644 5,238 3,022 
(Reversal of) Provision for Credit Losses for Unfunded Commitments
(839)318 774 
Net Interest Income After (Reversal of) Provision For Credit Losses
65,914 66,255 80,101 
Noninterest Income
Service charges on deposits1,631 1,626 1,339 
(Loss) Gain on sale of loans
(5)95 821 
Net gain on sale of investment securities
5 2 4 
Increase in cash surrender value of bank-owned life insurance669 648 631 
Other income4,047 6,224 2,513 
Total noninterest income6,347 8,595 5,308 
Noninterest Expense
Salaries and employee benefits21,549 21,957 21,538 
Premises and equipment expenses3,095 3,227 3,275 
Marketing and advertising768 884 1,181 
Data processing3,194 3,354 3,445 
Legal, accounting and professional fees2,162 2,649 2,332 
FDIC insurance3,342 2,581 1,287 
Other expenses3,523 3,326 3,148 
Total noninterest expense37,633 37,978 36,206 
Income Before Income Tax Expense34,628 36,872 49,203 
Income Tax Expense7,245 8,180 11,906 
Net Income$27,383 $28,692 $37,297 
Earnings Per Common Share
Basic$0.91 $0.94 $1.16 
Diluted$0.91 $0.94 $1.16 
12

Eagle Bancorp, Inc.
Consolidated Average Balances, Interest Yields And Rates vs. Prior Quarter (Unaudited)
(Dollars in thousands)
Three Months Ended
September 30, 2023June 30, 2023
Average BalanceInterestAverage
Yield/Rate		Average BalanceInterestAverage
Yield/Rate
ASSETS
Interest earning assets:
Interest bearing deposits with other banks and other short-term investments$1,127,451 $15,067 5.30 %$1,053,961 $13,229 5.03 %
Loans held for sale (1)
— — — %813 13 6.41 %
Loans (1) (2)
7,795,144 132,273 6.73 %7,790,555 128,980 6.64 %
Investment securities available-for-sale (2)
1,554,348 8,126 2.07 %1,626,330 8,526 2.10 %
Investment securities held-to-maturity (2)
1,047,515 5,606 2.12 %1,068,755 5,715 2.14 %
Federal funds sold7,728 77 3.95 %5,636 47 3.34 %
Total interest earning assets11,532,186 $161,149 5.54 %11,546,050 $156,510 5.44 %
Total noninterest earning assets489,683 492,426 
Less: allowance for credit losses78,964 78,365 
Total noninterest earning assets410,719 414,061 
TOTAL ASSETS$11,942,905 $11,960,111 
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest bearing liabilities:
Interest bearing transaction$1,421,522 $12,785 3.57 %$1,312,710 $10,640 3.25 %
Savings and money market3,113,755 32,855 4.19 %2,967,678 30,861 4.17 %
Time deposits2,162,582 25,289 4.64 %1,675,690 17,921 4.29 %
Total interest bearing deposits6,697,859 70,929 4.20 %5,956,078 59,422 4.00 %
Customer repurchase agreements36,082 311 3.42 %41,105 333 3.25 %
Other short-term borrowings1,540,221 18,152 4.68 %1,991,557 23,907 4.81 %
Long-term borrowings69,876 1,038 5.89 %69,845 1,037 5.96 %
Total interest bearing liabilities8,344,038 $90,430 4.30 %8,058,585 $84,699 4.22 %
Noninterest bearing liabilities:
Noninterest bearing demand2,248,782 2,558,860 
Other liabilities114,923 97,019 
Total noninterest bearing liabilities2,363,705 2,655,879 
Shareholders’ equity1,235,162 1,245,647 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$11,942,905 $11,960,111 
Net interest income$70,719 $71,811 
Net interest spread1.24 %1.22 %
Net interest margin2.43 %2.49 %
Cost of funds
3.39 %3.20 %
(1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $4.1 million and $4.2 million for the three months ended September 30, 2023 and June 30, 2023, respectively.
(2) Interest and fees on loans and investments exclude tax equivalent adjustments.

13

Eagle Bancorp, Inc.
Consolidated Average Balances, Interest Yields And Rates vs. Year Ago Quarter (Unaudited)
(Dollars in thousands)
Three Months Ended September 30,
20232022
Average BalanceInterestAverage
Yield/Rate		Average BalanceInterestAverage
Yield/Rate
ASSETS
Interest earning assets:
Interest bearing deposits with other banks and other short-term investments$1,127,451 $15,067 5.30 %$771,063 $4,100 2.11 %
Loans held for sale (1)
— — — %11,586 150 5.14 %
Loans (1) (2)
7,795,144 132,273 6.73 %7,282,589 93,594 5.10 %
Investment securities available-for-sale (2)
1,554,348 8,126 2.07 %1,782,859 7,587 1.69 %
Investment securities held-to-maturity (2)
1,047,515 5,606 2.12 %1,128,943 5,876 2.06 %
Federal funds sold7,728 77 3.95 %53,630 220 1.63 %
Total interest earning assets11,532,186 $161,149 5.54 %11,030,670 $111,527 4.01 %
Total noninterest earning assets489,683 475,581 
Less: allowance for credit losses78,964 75,141 
Total noninterest earning assets410,719 400,440 
TOTAL ASSETS$11,942,905 $11,431,110 
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest bearing liabilities:
Interest bearing transaction$1,421,522 $12,785 3.57 %$960,970 $1,891 0.78 %
Savings and money market3,113,755 32,855 4.19 %4,504,216 21,711 1.91 %
Time deposits2,162,582 25,289 4.64 %633,241 2,523 1.58 %
Total interest bearing deposits6,697,859 70,929 4.20 %6,098,427 26,125 1.70 %
Customer repurchase agreements36,082 311 3.42 %26,546 55 0.82 %
Other short-term borrowings1,540,221 18,152 4.68 %61,703 412 2.65 %
Long-term borrowings69,876 1,038 5.89 %69,752 1,038 5.90 %
Total interest bearing liabilities8,344,038 $90,430 4.30 %6,256,428 $27,630 1.75 %
Noninterest bearing liabilities:
Noninterest bearing demand2,248,782 3,809,070 
Other liabilities114,923 93,859 
Total noninterest bearing liabilities2,363,705 3,902,929 
Shareholders’ equity1,235,162 1,271,753 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$11,942,905 $11,431,110 
Net interest income$70,719 $83,897 
Net interest spread1.24 %2.26 %
Net interest margin2.43 %3.02 %
Cost of funds(3)
3.39 %1.09 %
(1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $4.1 million and $3.4 million for the three months ended September 30, 2023 and September 30, 2022, respectively.
(2) Interest and fees on loans and investments exclude tax equivalent adjustments.
(3) Beginning in the second quarter of 2023, the Company revised its cost of funds methodology to use a daily average calculation where interest expense on interest bearing liabilities is divided by average interest bearing liabilities and average noninterest bearing deposits. Previously, the Company calculated the cost of funds as the difference between yield on earning assets and net interest margin.
14

Eagle Bancorp, Inc.
Statements of Income and Highlights Quarterly Trends (Unaudited)
(Dollars in thousands, except per share data)
Three Months Ended
September 30,June 30,March 31,December 31,September 30,June 30,March 31,December 31,
Income Statements:20232023202320222022202220222021
Total interest income$161,149 $156,510 $140,247 $129,130 $111,527 $95,635 $88,321 $86,230 
Total interest expense90,430 84,699 65,223 43,530 27,630 12,717 7,869 8,044 
Net interest income70,719 71,811 75,024 85,600 83,897 82,918 80,452 78,186 
Provision for (reversal of) credit losses5,644 5,238 6,164 (464)3,022 495 (2,787)(6,412)
Provision for (reversal of) unfunded commitments(839)318 848 161 774 553 (11)(632)
Net interest income after provision for credit losses65,914 66,255 68,012 85,903 80,101 81,870 83,250 85,230 
Noninterest income before investment gain (loss)6,342 8,593 3,721 5,326 5,304 5,715 7,478 9,668 
Net gain (loss) on sale of investment securities5 2 (21)3 4 (151)(25)906 
Total noninterest income6,347 8,595 3,700 5,329 5,308 5,564 7,453 10,574 
Salaries and employee benefits21,549 21,957 24,174 23,691 21,538 21,805 17,019 24,608 
Premises and equipment3,095 3,227 3,317 3,292 3,275 3,523 3,128 3,755 
Marketing and advertising768 884 636 1,290 1,181 1,186 1,064 1,286 
Other expenses12,221 11,910 12,457 10,645 10,212 32,448 9,801 9,660 
Total noninterest expense37,633 37,978 40,584 38,918 36,206 58,962 31,012 39,309 
Income before income tax expense34,628 36,872 31,128 52,314 49,203 28,472 59,691 56,495 
Income tax expense7,245 8,180 6,894 10,121 11,906 12,776 13,947 14,875 
Net income$27,383 $28,692 $24,234 $42,193 $37,297 $15,696 $45,744 $41,620 
Per Share Data:
Earnings per weighted average common share, basic$0.91 $0.94 $0.78 $1.32 $1.16 $0.49 $1.43 $1.30 
Earnings per weighted average common share, diluted$0.91 $0.94 $0.78 $1.32 $1.16 $0.49 $1.42 $1.30 
Weighted average common shares outstanding, basic29,910,218 30,454,766 31,109,267 31,819,631 32,084,464 32,080,657 32,033,280 31,950,320 
Weighted average common shares outstanding, diluted29,944,692 30,505,468 31,180,346 31,898,619 32,155,678 32,142,427 32,110,099 32,030,998 
Actual shares outstanding at period end29,917,982 29,912,082 31,111,647 31,346,903 32,082,321 32,081,241 32,079,474 31,950,092 
Book value per common share at period end$40.64 $40.78 $39.92 $39.18 $38.02 $39.05 $39.89 $42.28 
Tangible book value per common share at period end (1)
$37.12 $37.29 $36.57 $35.86 $34.77 $35.80 $36.64 $38.97 
Dividend per common share$0.45 $0.45 $0.45 $0.45 $0.45 $0.45 $0.40 $0.40 
Performance Ratios (annualized):
Return on average assets0.91 %0.96 %0.86 %1.49 %1.29 %0.54 %1.46 %1.32 %
Return on average common equity8.80 %9.24 %7.92 %13.57 %11.64 %4.91 %13.83 %12.30 %
Return on average tangible common equity(1)
9.61 %10.08 %8.65 %14.82 %12.67 %5.35 %14.99 %13.35 %
Net interest margin2.43 %2.49 %2.77 %3.14 %3.02 %2.94 %2.65 %2.55 %
Efficiency ratio (2)
48.8 %47.2 %51.6 %42.8 %40.6 %66.6 %35.3 %44.3 %
Other Ratios:
Allowance for credit losses to total loans (3)
1.05 %1.00 %1.01 %0.97 %1.04 %1.02 %1.01 %1.06 %
Allowance for credit losses to total nonperforming loans118 %268 %1,160 %1,151 %997 %386 %301 %257 %
Nonperforming loans to total loans (3)
0.89 %0.37 %0.09 %0.08 %0.10 %0.26 %0.33 %0.41 %
Nonperforming assets to total assets
0.64 %0.28 %0.08 %0.08 %0.09 %0.19 %0.23 %0.26 %
Net charge-off (recovery)(annualized) to average total loans (3)
0.02 %0.29 %0.05 %0.05 %— %(0.04)%0.03 %0.07 %
Tier 1 capital (to average assets)10.96 %10.84 %11.42 %11.63 %11.55 %10.68 %9.82 %10.19 %
Total capital (to risk weighted assets)14.54 %14.51 %14.74 %14.94 %15.60 %15.14 %15.21 %15.74 %
Common equity tier 1 capital (to risk weighted assets)13.68 %13.55 %13.75 %14.03 %14.64 %14.06 %14.12 %14.63 %
Tangible common equity ratio (1)
10.04 %10.21 %10.36 %10.18 %10.52 %10.60 %10.57 %10.60 %
Average Balances (in thousands):
Total assets$11,942,905 $11,960,111 $11,426,056 $11,255,956 $11,431,110 $11,701,679 $12,701,152 $12,538,596 
Total earning assets$11,532,186 $11,546,050 $11,004,817 $10,829,703 $11,030,670 $11,300,267 $12,326,473 $12,180,872 
Total loans(3)
$7,795,144 $7,790,555 $7,712,023 $7,379,198 $7,282,589 $7,104,727 $7,053,701 $6,890,414 
Total deposits$8,946,641 $8,514,938 $8,734,125 $9,524,139 $9,907,497 $10,184,886 $10,874,976 $10,670,206 
Total borrowings$1,646,179 $2,102,507 $1,359,463 $411,060 $158,001 $152,583 $371,987 $402,393 
Total shareholders’ equity$1,235,162 $1,245,647 $1,240,978 $1,233,705 $1,271,753 $1,281,742 $1,341,785 $1,342,525 
(1) A reconciliation of non-GAAP financial measures to the nearest GAAP measure is provided in the tables that accompany this document.
(2) Computed by dividing noninterest expense by the sum of net interest income and noninterest income.
(3) Excludes loans held for sale.
15
v3.23.3
Cover
Oct. 25, 2023
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 25, 2023
Entity Registrant Name EAGLE BANCORP, INC.
Entity Incorporation, State or Country Code MD
Entity File Number 0-25923
Entity Tax Identification Number 52-2061461
Entity Address, Address Line One 7830 Old Georgetown Road, Third Floor
Entity Address, City or Town Bethesda
Entity Address, State or Province MD
Entity Address, Postal Zip Code 20814
City Area Code 301
Local Phone Number 986-1800
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $0.01 par value
Trading Symbol EGBN
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001050441
Eagle Bancorp (NASDAQ:EGBN)
Historical Stock Chart
From Mar 2024 to Apr 2024 Click Here for more Eagle Bancorp Charts.
Eagle Bancorp (NASDAQ:EGBN)
Historical Stock Chart
From Apr 2023 to Apr 2024 Click Here for more Eagle Bancorp Charts.