Red River Bancshares, Inc. (the “Company”), (Nasdaq: RRBI), the
holding company for Red River Bank (the “Bank”), announced today
its unaudited financial results for the first quarter of 2020 and
provided an update on the Bank's response to the outbreak of the
novel coronavirus ("COVID-19") pandemic and its participation in
the Small Business Administration ("SBA") Paycheck Protection
Program ("PPP").
Net income for the first quarter of 2020 was $6.7 million, or
$0.92 per diluted common share ("EPS"), which was consistent with
$6.7 million, or $0.92 EPS, for the fourth quarter of 2019, and an
increase of $1.0 million, or 18.4%, compared to $5.7 million, or
$0.85 EPS, for the first quarter of 2019.
COVID-19 Pandemic and the Paycheck Protection Program
Update
In January and February of 2020, Red River Bank had normal
banking operations. However, March and April of 2020 were dominated
by the global outbreak of the COVID-19 pandemic, the passage of the
Coronavirus Aid, Relief, and Economic Security ("CARES") Act, and
the implementation of the PPP. During March 2020, the governor of
Louisiana closed schools, required nonessential businesses to
reduce operations or to close, and recommended that residents
self-quarantine at home.
In order to support our customers and communities during this
crisis, our bankers promptly assisted our customers with loan
adjustments, monitored the CARES Act, implemented the PPP, and
adjusted customers' fees. On Saturday, April 4, 2020, Red River
Bank began accepting PPP loan applications with an easy to use,
efficient, and digital process. Additionally, we suspended or
reduced various fees to assist our customers during this
crisis.
Blake Chatelain, President and Chief Executive Officer stated,
"The coronavirus pandemic has been an unprecedented event for
Louisiana, the United States, and the world. This health crisis and
the resulting economic disruption has had a significant impact on
our customers and communities. We recognize that community banks
are an essential part of the local economy, and we have been
determined to support our customers, while also protecting our team
members. In March and April, we continued offering full banking
services while allowing lobby access through appointments, updated
customers on relief loan programs, offered deferrals on loans,
adjusted loan payment terms, and made emergency loans to our
customers."
Regarding PPP loans, Mr. Chatelain explained, "On Saturday,
April 4, 2020, we began accepting applications for loans under the
PPP. We developed a simple, digital process for borrowers to
complete the PPP application, to provide their required documents,
and to digitally sign the application without coming into the Bank.
Within five days, we received over 1,000 PPP applications and
supporting documents, performed the credit review, posted the
application to the SBA E-Tran system, and funded PPP loans. As of
April 20, 2020, we reserved approximately 1,100 PPP loans for
$190.0 million with the SBA under the initial PPP. Of the 1,100
loans, 88% were for small businesses requesting $350,000 or less,
and our average PPP loan size was $173,000. We are also
participating in the second PPP which began on Monday, April 27,
2020. We hope these funds allow these companies to maintain their
businesses, keep their teams employed, and continue to provide
important services to our communities."
Mr. Chatelain notes, "We are in the midst of this crisis, and
our priority is taking care of our customers and employees;
however, we realize that the pandemic will also have implications
for Red River Bank. The prospect for a successful economic recovery
is dependent on containing the outbreak, reopening businesses, and
getting people back to work. The Louisiana economy is also affected
by the recent decrease in oil prices. We are monitoring credit
issues extremely closely, and in anticipation of potential future
loan losses, we increased the provision for loan losses for the
first quarter by $125,000. We expect that our income from the PPP
program will be offset by the costs associated with implementing
the program and increased loan provision expense. Also, net
interest income and net interest margin are expected to be
negatively affected by the extremely low interest rate environment.
Our company is well positioned to continue supporting our customers
during these challenging times. We are well capitalized, have good
liquidity, a strong core deposit franchise, a diversified loan
portfolio, and a dedicated team of bankers."
First Quarter 2020 Performance and Operational
Highlights
- Net income was $6.7 million for both the first quarter of 2020
and the fourth quarter of 2019. For the first quarter of 2020, the
quarterly return on assets was 1.36%, and the quarterly return on
equity was 10.53%.
- The Company changed the timing and frequency for payment of its
cash dividends. Beginning with the first quarter of 2020, our board
of directors and management will evaluate the payment of cash
dividends on a quarterly basis, rather than annually as was done in
2018 and 2019. The decision whether to pay a quarterly cash
dividend will be based upon the Company's prior quarter
profitability and current capital levels, among other factors. In
the first quarter of 2020, the Company declared and paid a
quarterly cash dividend of $0.06 per common share. As of March 31,
2020, the Company had $264.2 million of stockholders' equity
resulting in a leverage ratio (Tier 1 risk-based capital to average
assets) of 12.89%.
- As of March 31, 2020, the Company had $2.01 billion of assets,
$1.45 billion of loans held for investment ("HFI"), and $1.73
billion of deposits. The loans HFI to deposits ratio was 83.77%,
and the noninterest-bearing deposits to total deposits ratio was
35.15%.
- The net interest margin was negatively impacted by two
significant Federal Reserve rate decreases which occurred in March
2020 in response to the COVID-19 pandemic. The net interest margin,
fully tax equivalent basis ("FTE"), decreased nine basis points to
3.41% for the first quarter of 2020, compared to 3.50% for the
prior quarter.
- Due to the expected economic impact of COVID-19 related
closures on businesses and consumers throughout Louisiana, our
provision for loan losses was $125,000 higher for the first quarter
of 2020 than the prior quarter.
- Security portfolio transactions increased in the first quarter
of 2020, resulting in a $383,000 gain on the sale of securities
compared to $13,000 for the fourth quarter of 2019.
- In the first quarter of 2020, we completed final resolution on
the remaining assets relating to an acquired subsidiary, and the
company was dissolved. As a result of these nonrecurring
transactions, expenses were reduced by $311,000.
- The Bank did not have an FDIC insurance assessment for the
fourth quarter of 2019 or the first quarter of 2020.
- Effective January 1, 2020, a new, optional community bank
leverage ratio ("CBLR") framework was available to qualifying
financial institutions. Although both the Company and the Bank
qualify for the CBLR framework, management does not currently
intend to utilize the CBLR framework and will continue to calculate
and report Basel III risk-based capital results.
- Late in 2019, we purchased a banking center building in
Sulphur, Louisiana, located in our Southwest Louisiana market. This
property was remodeled and opened as the newest Red River Bank
banking center during the first quarter of 2020.
Regarding the first quarter activity, Mr. Chatelain stated, "In
addition to reacting to the coronavirus pandemic and implementing
the PPP in the first quarter of 2020, we had steady balance sheet
growth, consistent net income, closed a subsidiary, and opened a
new banking center. We completed the successful resolution of a
small subsidiary acquired with our Southeast market expansion. As
part of our continued Southwest Louisiana market organic expansion,
we hired additional local, experienced bankers and on March 23,
2020, opened a full-service banking center in Sulphur, Louisiana.
We are actively evaluating other new properties in this market and
plan to continue growing Red River Bank throughout Louisiana."
Net Interest Income and Net Interest Margin
(FTE)
Net interest income and net interest margin (FTE) for the first
quarter of 2020 were negatively impacted by the March 2020 150
basis point decrease to the target federal funds rate by the
Federal Reserve.
Net interest income for the first quarter of 2020 was $16.1
million, which was $255,000, or 1.6%, lower than the fourth quarter
of 2019, mainly due to a $204,000 decrease in interest and dividend
income. Interest and dividend income decreased due to the lower
interest rate environment and the impact on variable rate earning
assets, partially offset by a 2.0% increase in interest-earning
assets.
The net interest margin (FTE) decreased nine basis points to
3.41% for the first quarter of 2020, compared to 3.50% for the
prior quarter, mainly due to the significant Federal Reserve rate
decreases in the first quarter. The yield on loans decreased three
basis points due to the impact of the lower interest rate
environment on new, renewed, and floating rate loans. As of March
31, 2020, floating rate loans were 15.9% of loans HFI. The yield on
federal funds sold decreased 29 basis points. The yield on taxable
securities decreased 22 basis points due to the negative impact of
the lower interest rate environment on the mortgage-backed
securities sector, partially offset by restructuring transactions
that improved the yield on the funds reinvested. The resulting
yield on interest-earning assets was 3.89% for the first quarter of
2020, compared to 3.97% for the fourth quarter of 2019. As a result
of competition for deposits, the cost of deposits was 0.58% for the
first quarter of 2020, compared to 0.57% for the prior quarter.
Provision for Loan Losses
We increased the provision for loan losses $125,000 to $503,000
for the first quarter of 2020, compared to $378,000 for the prior
quarter, due to expected economic pressures relating to the
COVID-19 pandemic.
Noninterest Income
Noninterest income totaled $4.7 million for the first quarter of
2020, an increase of $542,000, or 12.9%, compared to $4.2 million
for the previous quarter. The increase was mainly due to a larger
gain on the sale of securities and higher brokerage and mortgage
income.
The gain on the sale of securities was $383,000 for the first
quarter of 2020 due to proactive portfolio restructuring executed
in response to the changing interest rate environment, compared to
a $13,000 gain in the prior quarter.
Brokerage income for the first quarter of 2020 totaled $744,000,
an increase of $171,000, or 29.8%, compared to the previous
quarter. This record level of income was due to additional funds
invested by existing clients.
Mortgage loan income totaled $889,000 for the first quarter of
2020, an increase of $73,000, or 8.9%, from the previous quarter's
total of $816,000. The growth in mortgage loan income was driven by
the increased demand as a result of a lower interest rate
environment.
As mentioned in the COVID-19 update, we suspended or reduced
various fees to assist our customers during this crisis. Effective
April 1, 2020, we waived all consumer loan and credit card late
fees and reduced the non-sufficient fund fee by 50%. We expect
these changes will adversely affect our ongoing noninterest
income.
Operating Expenses
Operating expenses for the first quarter of 2020 totaled $12.0
million, an increase of $62,000, or 0.5%, compared to $11.9 million
for the fourth quarter of 2019. The increase was mainly due to
higher personnel expenses, legal and professional fees, and other
taxes, partially offset by a nonrecurring expense reduction in
other operating expenses.
Personnel expenses totaled $7.3 million for the first quarter of
2020, up $200,000, or 2.8%, from the fourth quarter of 2019. This
increase was due to staff added in our Southwest Louisiana market
resulting from the opening of our Sulphur full-service banking
center, increased revenue-based commission compensation, and the
restarting of payroll tax wage limits.
Legal and professional expenses totaled $495,000 for the first
quarter of 2020, up $92,000, or 22.8%, from the fourth quarter of
2019 due to higher than normal legal expenses.
Other taxes totaled $437,000 for the first quarter of 2020, up
$91,000, or 26.3%, from the fourth quarter of 2019. For the fourth
quarter of 2019, the State of Louisiana bank stock tax expense
benefited from a $53,000 nonrecurring year-end adjustment.
Other operating expenses decreased by $274,000 for the first
quarter of 2020, compared to the previous quarter. This decrease
was mainly due to a nonrecurring $311,000 expense reduction related
to the dissolution of an acquired subsidiary.
Loans and Asset Quality
Loans HFI as of March 31, 2020, were $1.45 billion, an
increase of $8.4 million, or 0.6%, from December 31, 2019. The
increase in loans in the first quarter of 2020 was primarily due to
new loan activity in our newer markets.
Nonperforming assets ("NPA(s)") totaled $6.1 million as of
March 31, 2020, down $361,000, or 5.6%, from December 31,
2019, primarily due to the sale of foreclosed assets. The ratio of
NPAs to total assets improved to 0.30% as of March 31, 2020, from
0.33% as of December 31, 2019.
As of March 31, 2020, the allowance for loan losses ("ALL")
was $14.4 million and the ratio of ALL to loans HFI was 0.99%. The
net charge-off ratio was 0.00% for the first quarter of 2020 and
0.02% for the fourth quarter of 2019.
As discussed in the COVID-19 update, as of April 20, 2020, we
reserved approximately 1,100 PPP loans for $190.0 million with the
SBA. The average PPP loan size was $173,000, and PPP loans
represent approximately 11.6% of proforma loans HFI as of April 20,
2020. Also, to support our customers during the COVID-19 crisis, we
deferred loan payments for many of our customers. In March of 2020
and through April 20, 2020, we deferred loan payments on
approximately 390 loans totaling $200.0 million, or 13.8%, of loans
HFI as of March 31, 2020. Loans with principal and interest
deferrals accounted for 2.9% of loans HFI as of March 31, 2020. The
remaining deferrals were for principal payments only, with
continued interest payments required during the deferral
period.
Due to COVID-19 related closures of businesses and the effect on
their employees, vendors, and customers, we are closely monitoring
asset quality and are expecting an increased level of problem
loans. This would likely result in an increase to our provision for
loan losses throughout 2020.
Although the economic effect of the COVID-19 outbreak remains
uncertain, the following table shows loans HFI in the industries
that we believe are most likely to be affected by this crisis:
|
March 31, 2020 |
(dollars in thousands) |
Amount |
|
Percent of Loans HFI |
Hospitality services: |
|
|
|
Hotels |
$ |
20,616 |
|
|
1.4 |
% |
Restaurants - full service |
11,116 |
|
|
0.8 |
% |
Restaurants - limited service |
11,642 |
|
|
0.8 |
% |
Other |
3,515 |
|
|
0.2 |
% |
Total hospitality
services |
$ |
46,889 |
|
|
3.2 |
% |
|
|
|
|
Retail trade: |
|
|
|
Automobile dealers |
$ |
37,826 |
|
|
2.6 |
% |
Other retail |
26,183 |
|
|
1.8 |
% |
Total retail trade |
$ |
64,009 |
|
|
4.4 |
% |
|
|
|
|
Energy |
$ |
30,113 |
|
|
2.1 |
% |
The following table shows loans HFI in other non-industry
specific areas that we believe may be affected by this crisis:
|
March 31, 2020 |
(dollars in thousands) |
Amount |
|
Percent of Loans HFI |
Loans collateralized by non-owner occupied properties leased to
retail establishments |
$ |
40,611 |
|
|
2.8 |
% |
|
|
|
|
Credit card loans: |
|
|
|
Commercial |
$ |
1,244 |
|
|
0.1 |
% |
Consumer |
819 |
|
|
— |
% |
Total credit card loans |
$ |
2,063 |
|
|
0.1 |
% |
Deposits
Deposits as of March 31, 2020, were $1.73 billion, an
increase of $6.7 million, or 0.4%, compared to December 31,
2019. Average deposits for the first quarter of 2020 were $1.72
billion, an increase of $33.3 million, or 2.0%, from the prior
quarter.
Noninterest-bearing deposits totaled $607.3 million as of
March 31, 2020, up $22.4 million, or 3.8%, from
December 31, 2019, due to normal fluctuations in customer
account balances and adding new accounts. As of March 31,
2020, noninterest-bearing deposits were 35.15% of total
deposits.
Interest-bearing deposits totaled $1.12 billion as of March 31,
2020, down $15.7 million, or 1.4%, compared to December 31, 2019.
This decrease was a result of normal seasonal drawdowns as public
entity customers distributed their year-end funds to other
organizations.
Stockholders’ Equity
Total stockholders’ equity increased to $264.2 million as of
March 31, 2020, from $251.9 million as of December 31,
2019. The $12.3 million increase in stockholders’ equity during the
first quarter of 2020 was attributable to $6.7 million of net
income and a $5.8 million, net of tax, market adjustment to
accumulated other comprehensive income related to available for
sale securities, partially offset by $439,000 in cash dividends. We
paid our first quarterly cash dividend of $0.06 per share on March
26, 2020.
Non-GAAP Disclosure
Our accounting and reporting policies conform to United States
generally accepted accounting principles ("GAAP") and the
prevailing practices in the banking industry. Certain financial
measures used by management to evaluate our operating performance
are discussed as supplemental non-GAAP performance measures. In
accordance with the Security and Exchange Commission's ("SEC")
rules, we classify a financial measure as being a non-GAAP
financial measure if that financial measure excludes or includes
amounts, or is subject to adjustments that have the effect of
excluding or including amounts, that are included or excluded, as
the case may be, in the most directly comparable measure calculated
and presented in accordance with GAAP as in effect from time to
time in the U.S. Non-GAAP financial measures do not include
operating and other statistical measures or ratios or statistical
measures calculated using exclusively either financial measures
calculated in accordance with GAAP, operating measures or other
measures that are not non-GAAP financial measures, or both.
Management and the board of directors review tangible book value
per share and tangible common equity to tangible assets as part of
managing operating performance. However, these non-GAAP financial
measures should not be considered in isolation or as a substitute
for the most directly comparable or other financial measures
calculated in accordance with GAAP. Moreover, the manner in which
we calculate the non-GAAP financial measures that are discussed may
differ from that of other companies reporting measures with similar
names. It is important to understand how such other banking
organizations calculate and name their financial measures similar
to the non-GAAP financial measures discussed by us when comparing
such non-GAAP financial measures.
A reconciliation of non-GAAP financial measures to the
comparable GAAP financial measures is included at the end of the
financial statement tables.
About Red River Bancshares, Inc.
The Company is the bank holding company for Red River Bank, a
Louisiana state-chartered bank established in 1999 that provides a
fully integrated suite of banking products and services tailored to
the needs of commercial and retail customers. Red River Bank
operates from a network of 25 banking centers throughout Louisiana.
Banking centers are located in the following Louisiana markets:
Central Louisiana, which includes the Alexandria metropolitan
statistical area ("MSA"); Northwest Louisiana, which includes the
Shreveport-Bossier City MSA; Southeast Louisiana, which includes
the Baton Rouge MSA; Southwest Louisiana, which includes the Lake
Charles MSA; and the Northshore, which includes Covington.
Forward-Looking Statements
Statements in this news release regarding our expectations and
beliefs about our future financial performance and financial
condition, as well as trends in our business and markets, are
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements often include words such as “believe,” “expect,”
“anticipate,” “intend,” “plan,” “estimate,” “project,” “outlook,”
or words of similar meaning, or future or conditional verbs such as
“will,” “would,” “should,” “could,” or “may.” The forward-looking
statements in this news release are based on current information
and on assumptions that we make about future events and
circumstances that are subject to a number of risks and
uncertainties that are often difficult to predict and beyond our
control. As a result of those risks and uncertainties, our actual
financial results in the future could differ, possibly materially,
from those expressed in or implied by the forward-looking
statements contained in this news release and could cause us to
make changes to our future plans. Additional information regarding
these and other risks and uncertainties to which our business and
future financial performance are subject is contained in the
section titled “Risk Factors” in our most recent Annual Report on
Form 10-K and any subsequent quarterly reports on Form 10-Q, and in
other documents that we file with the SEC from time to time. In
addition, our actual financial results in the future may differ
from those currently expected due to additional risks and
uncertainties of which we are not currently aware or which we do
not currently view as, but in the future may become, material to
our business or operating results. Due to these and other possible
uncertainties and risks, readers are cautioned not to place undue
reliance on the forward-looking statements contained in this news
release or to make predictions based solely on historical financial
performance. Any forward-looking statement speaks only as of the
date on which it is made, and we do not undertake any obligation to
update or review any forward-looking statement, whether as a result
of new information, future developments or otherwise, except as
required by law. All forward-looking statements, express or
implied, included in this news release are qualified in their
entirety by this cautionary statement.
FINANCIAL HIGHLIGHTS (UNAUDITED) |
|
|
|
As of and for the Three Months Ended |
(Dollars in thousands, except
per share data) |
|
Mar. 31, 2020 |
|
Dec. 31, 2019 |
|
Mar. 31, 2019 |
|
|
|
|
|
|
|
Net Income |
|
$ |
6,745 |
|
|
$ |
6,743 |
|
|
$ |
5,696 |
|
|
|
|
|
|
|
|
Per Common Share
Data: |
|
|
|
|
|
|
Earnings per share, basic |
|
$ |
0.92 |
|
|
$ |
0.92 |
|
|
$ |
0.86 |
|
Earnings per share, diluted |
|
$ |
0.92 |
|
|
$ |
0.92 |
|
|
$ |
0.85 |
|
Book value per share |
|
$ |
36.08 |
|
|
$ |
34.48 |
|
|
$ |
30.46 |
|
Tangible book value per share |
|
$ |
35.87 |
|
|
$ |
34.27 |
|
|
$ |
30.23 |
|
Cash dividends per share |
|
$ |
0.06 |
|
|
$ |
— |
|
|
$ |
0.20 |
|
Weighted average shares outstanding, basic |
|
7,313,279 |
|
|
7,306,221 |
|
|
6,632,482 |
|
Weighted average shares outstanding, diluted |
|
7,351,409 |
|
|
7,347,602 |
|
|
6,668,029 |
|
|
|
|
|
|
|
|
Summary Performance
Ratios: |
|
|
|
|
|
|
Return on average assets |
|
1.36 |
% |
|
1.37 |
% |
|
1.24 |
% |
Return on average equity |
|
10.53 |
% |
|
10.72 |
% |
|
11.69 |
% |
Net interest margin |
|
3.36 |
% |
|
3.45 |
% |
|
3.47 |
% |
Net interest margin (FTE) |
|
3.41 |
% |
|
3.50 |
% |
|
3.52 |
% |
Efficiency ratio |
|
57.40 |
% |
|
57.90 |
% |
|
59.52 |
% |
Loans HFI to deposits ratio |
|
83.77 |
% |
|
83.60 |
% |
|
79.78 |
% |
Noninterest-bearing deposits to deposits ratio |
|
35.15 |
% |
|
33.98 |
% |
|
33.45 |
% |
Noninterest income to average assets |
|
0.95 |
% |
|
0.85 |
% |
|
0.72 |
% |
Operating expense to average assets |
|
2.41 |
% |
|
2.41 |
% |
|
2.43 |
% |
|
|
|
|
|
|
|
Summary Credit Quality
Ratios: |
|
|
|
|
|
|
Nonperforming assets to total assets |
|
0.30 |
% |
|
0.33 |
% |
|
0.34 |
% |
Nonperforming loans to loans HFI |
|
0.36 |
% |
|
0.37 |
% |
|
0.46 |
% |
Allowance for loan losses to loans HFI |
|
0.99 |
% |
|
0.97 |
% |
|
0.97 |
% |
Net charge-offs to average loans |
|
0.00 |
% |
|
0.02 |
% |
|
0.00 |
% |
|
|
|
|
|
|
|
Capital
Ratios: |
|
|
|
|
|
|
Total stockholders' equity to total assets |
|
13.14 |
% |
|
12.67 |
% |
|
10.52 |
% |
Tangible common equity to tangible assets |
|
13.07 |
% |
|
12.60 |
% |
|
10.45 |
% |
Total risk-based capital to risk-weighted assets |
|
18.18 |
% |
|
18.02 |
% |
|
16.52 |
% |
Tier 1 risk-based capital to risk-weighted assets |
|
17.21 |
% |
|
17.07 |
% |
|
15.57 |
% |
Common equity Tier 1 capital to risk-weighted assets |
|
17.21 |
% |
|
17.07 |
% |
|
14.78 |
% |
Tier 1 risk-based capital to average assets |
|
12.89 |
% |
|
12.82 |
% |
|
11.50 |
% |
|
|
|
|
|
|
|
|
|
|
RED RIVER BANCSHARES, INC. |
CONSOLIDATED BALANCE SHEETS |
|
|
(Unaudited) |
|
(Audited) |
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
(in thousands) |
Mar. 31, 2020 |
|
Dec. 31, 2019 |
|
Sept. 30, 2019 |
|
June 30, 2019 |
|
Mar. 31, 2019 |
ASSETS |
|
|
|
|
|
|
|
|
|
Cash and due from banks |
$ |
31,858 |
|
|
$ |
25,937 |
|
|
$ |
32,724 |
|
|
$ |
29,854 |
|
|
$ |
32,371 |
|
Interest-bearing deposits in other banks |
48,605 |
|
|
107,355 |
|
|
73,598 |
|
|
71,761 |
|
|
145,593 |
|
Securities available-for-sale |
401,944 |
|
|
335,573 |
|
|
341,900 |
|
|
318,082 |
|
|
319,353 |
|
Equity securities |
3,998 |
|
|
3,936 |
|
|
3,954 |
|
|
3,924 |
|
|
3,869 |
|
Nonmarketable equity securities |
1,354 |
|
|
1,350 |
|
|
1,347 |
|
|
1,342 |
|
|
1,303 |
|
Loans held for sale |
6,597 |
|
|
5,089 |
|
|
4,113 |
|
|
6,029 |
|
|
2,210 |
|
Loans held for investment |
1,447,362 |
|
|
1,438,924 |
|
|
1,413,162 |
|
|
1,393,154 |
|
|
1,349,181 |
|
Allowance for loans losses |
(14,393 |
) |
|
(13,937 |
) |
|
(13,906 |
) |
|
(13,591 |
) |
|
(13,101 |
) |
Premises and equipment, net |
41,711 |
|
|
41,744 |
|
|
39,828 |
|
|
40,032 |
|
|
40,033 |
|
Accrued interest receivable |
5,240 |
|
|
5,251 |
|
|
4,928 |
|
|
5,570 |
|
|
4,988 |
|
Bank-owned life insurance |
21,987 |
|
|
21,845 |
|
|
21,707 |
|
|
21,570 |
|
|
21,434 |
|
Intangible assets |
1,546 |
|
|
1,546 |
|
|
1,546 |
|
|
1,546 |
|
|
1,546 |
|
Right-of-use assets |
4,454 |
|
|
4,553 |
|
|
4,651 |
|
|
4,748 |
|
|
4,844 |
|
Other assets |
8,438 |
|
|
9,059 |
|
|
9,302 |
|
|
8,897 |
|
|
8,494 |
|
Total Assets |
$ |
2,010,701 |
|
|
$ |
1,988,225 |
|
|
$ |
1,938,854 |
|
|
$ |
1,892,918 |
|
|
$ |
1,922,118 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
|
|
Noninterest-bearing deposits |
$ |
607,322 |
|
|
$ |
584,915 |
|
|
$ |
615,051 |
|
|
$ |
576,934 |
|
|
$ |
565,757 |
|
Interest-bearing deposits |
1,120,460 |
|
|
1,136,205 |
|
|
1,061,800 |
|
|
1,057,656 |
|
|
1,125,377 |
|
Total Deposits |
1,727,782 |
|
|
1,721,120 |
|
|
1,676,851 |
|
|
1,634,590 |
|
|
1,691,134 |
|
Other borrowed funds |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Junior subordinated debentures |
— |
|
|
— |
|
|
— |
|
|
5,155 |
|
|
11,341 |
|
Accrued interest payable |
2,307 |
|
|
2,222 |
|
|
1,925 |
|
|
1,998 |
|
|
1,967 |
|
Lease liabilities |
4,511 |
|
|
4,603 |
|
|
4,688 |
|
|
4,773 |
|
|
4,856 |
|
Accrued expenses and other liabilities |
11,926 |
|
|
8,382 |
|
|
10,001 |
|
|
8,491 |
|
|
10,636 |
|
Total Liabilities |
1,746,526 |
|
|
1,736,327 |
|
|
1,693,465 |
|
|
1,655,007 |
|
|
1,719,934 |
|
COMMITMENTS AND
CONTINGENCIES |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
Preferred stock, no par value |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Common stock, no par value |
68,177 |
|
|
68,082 |
|
|
68,082 |
|
|
68,082 |
|
|
41,271 |
|
Additional paid-in capital |
1,333 |
|
|
1,269 |
|
|
1,205 |
|
|
1,141 |
|
|
1,091 |
|
Retained earnings |
188,877 |
|
|
182,571 |
|
|
175,828 |
|
|
168,981 |
|
|
163,443 |
|
Accumulated other comprehensive income (loss) |
5,788 |
|
|
(24 |
) |
|
274 |
|
|
(293 |
) |
|
(3,621 |
) |
Total Stockholders' Equity |
264,175 |
|
|
251,898 |
|
|
245,389 |
|
|
237,911 |
|
|
202,184 |
|
Total Liabilities and Stockholders' Equity |
$ |
2,010,701 |
|
|
$ |
1,988,225 |
|
|
$ |
1,938,854 |
|
|
$ |
1,892,918 |
|
|
$ |
1,922,118 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RED RIVER BANCSHARES, INC. |
|
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) |
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
(in
thousands) |
|
Mar. 31, 2020 |
|
Dec. 31, 2019 |
|
Mar. 31, 2019 |
|
|
INTEREST AND DIVIDEND
INCOME |
|
|
|
|
|
|
|
Interest and fees on loans |
|
$ |
16,466 |
|
|
$ |
16,544 |
|
|
$ |
15,504 |
|
|
Interest on securities |
|
1,791 |
|
|
1,894 |
|
|
1,763 |
|
|
Interest on federal funds sold |
|
113 |
|
|
150 |
|
|
212 |
|
|
Interest on deposits in other banks |
|
206 |
|
|
192 |
|
|
416 |
|
|
Dividends on stock |
|
4 |
|
|
4 |
|
|
9 |
|
|
Total Interest and Dividend Income |
|
18,580 |
|
|
18,784 |
|
|
17,904 |
|
|
INTEREST EXPENSE |
|
|
|
|
|
|
|
Interest on deposits |
|
2,492 |
|
|
2,441 |
|
|
2,296 |
|
|
Interest on junior subordinated debentures |
|
— |
|
|
— |
|
|
156 |
|
|
Total Interest Expense |
|
2,492 |
|
|
2,441 |
|
|
2,452 |
|
|
Net Interest
Income |
|
16,088 |
|
|
16,343 |
|
|
15,452 |
|
|
Provision for loan losses |
|
503 |
|
|
378 |
|
|
526 |
|
|
Net Interest Income
After Provision for Loan Losses |
|
15,585 |
|
|
15,965 |
|
|
14,926 |
|
|
NONINTEREST INCOME |
|
|
|
|
|
|
|
Service charges on deposit accounts |
|
1,228 |
|
|
1,270 |
|
|
1,026 |
|
|
Debit card income, net |
|
755 |
|
|
782 |
|
|
695 |
|
|
Mortgage loan income |
|
889 |
|
|
816 |
|
|
514 |
|
|
Brokerage income |
|
744 |
|
|
573 |
|
|
365 |
|
|
Loan and deposit income |
|
300 |
|
|
389 |
|
|
346 |
|
|
Bank-owned life insurance income |
|
142 |
|
|
137 |
|
|
133 |
|
|
Gain (Loss) on equity securities |
|
63 |
|
|
(19 |
) |
|
48 |
|
|
Gain (Loss) on sale of securities |
|
383 |
|
|
13 |
|
|
— |
|
|
SBIC income |
|
178 |
|
|
185 |
|
|
120 |
|
|
Other income |
|
49 |
|
|
43 |
|
|
49 |
|
|
Total Noninterest Income |
|
4,731 |
|
|
4,189 |
|
|
3,296 |
|
|
OPERATING EXPENSES |
|
|
|
|
|
|
|
Personnel expenses |
|
7,348 |
|
|
7,148 |
|
|
6,640 |
|
|
Occupancy and equipment expenses |
|
1,185 |
|
|
1,268 |
|
|
1,175 |
|
|
Technology expenses |
|
586 |
|
|
596 |
|
|
544 |
|
|
Advertising |
|
261 |
|
|
204 |
|
|
209 |
|
|
Other business development expenses |
|
295 |
|
|
281 |
|
|
282 |
|
|
Data processing expense |
|
450 |
|
|
462 |
|
|
459 |
|
|
Other taxes |
|
437 |
|
|
346 |
|
|
353 |
|
|
Loan and deposit expenses |
|
246 |
|
|
247 |
|
|
223 |
|
|
Legal and professional expenses |
|
495 |
|
|
403 |
|
|
319 |
|
|
Regulatory assessment expense |
|
26 |
|
|
38 |
|
|
142 |
|
|
Other operating expenses |
|
621 |
|
|
895 |
|
|
812 |
|
|
Total Operating Expenses |
|
11,950 |
|
|
11,888 |
|
|
11,158 |
|
|
Income Before Income
Tax Expense |
|
8,366 |
|
|
8,266 |
|
|
7,064 |
|
|
Income tax expense |
|
1,621 |
|
|
1,523 |
|
|
1,368 |
|
|
Net
Income |
|
$ |
6,745 |
|
|
$ |
6,743 |
|
|
$ |
5,696 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RED RIVER BANCSHARES, INC. |
NET INTEREST INCOME AND NET INTEREST MARGIN
(UNAUDITED) |
|
|
For the Three Months Ended |
|
March 31, 2020 |
|
December 31, 2019 |
|
March 31, 2019 |
(dollars in thousands) |
Average Balance Outstanding |
|
Interest Earned/ Interest Paid |
|
Average Yield/ Rate |
|
Average Balance Outstanding |
|
Interest Earned/ Interest Paid |
|
Average Yield/ Rate |
|
Average Balance Outstanding |
|
Interest Earned/ Interest Paid |
|
Average Yield/ Rate |
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans(1,2) |
$ |
1,449,995 |
|
|
$ |
16,466 |
|
|
4.50 |
% |
|
$ |
1,428,978 |
|
|
$ |
16,544 |
|
|
4.53 |
% |
|
$ |
1,344,523 |
|
|
$ |
15,504 |
|
|
4.61 |
% |
Securities - taxable |
262,417 |
|
|
1,267 |
|
|
1.93 |
% |
|
258,491 |
|
|
1,392 |
|
|
2.15 |
% |
|
261,325 |
|
|
1,378 |
|
|
2.11 |
% |
Securities - tax-exempt |
86,891 |
|
|
524 |
|
|
2.41 |
% |
|
85,749 |
|
|
502 |
|
|
2.34 |
% |
|
64,630 |
|
|
385 |
|
|
2.38 |
% |
Federal funds sold |
34,030 |
|
|
113 |
|
|
1.32 |
% |
|
36,470 |
|
|
150 |
|
|
1.61 |
% |
|
34,228 |
|
|
212 |
|
|
2.48 |
% |
Interest-bearing balances due from banks |
59,756 |
|
|
206 |
|
|
1.36 |
% |
|
45,565 |
|
|
192 |
|
|
1.65 |
% |
|
70,473 |
|
|
416 |
|
|
2.36 |
% |
Nonmarketable equity securities |
1,351 |
|
|
4 |
|
|
1.07 |
% |
|
1,346 |
|
|
4 |
|
|
1.19 |
% |
|
1,299 |
|
|
4 |
|
|
1.23 |
% |
Investment in trusts |
— |
|
|
— |
|
|
— |
% |
|
— |
|
|
— |
|
|
— |
% |
|
341 |
|
|
5 |
|
|
5.95 |
% |
Total interest-earning assets |
1,894,440 |
|
|
$ |
18,580 |
|
|
3.89 |
% |
|
1,856,599 |
|
|
$ |
18,784 |
|
|
3.97 |
% |
|
1,776,819 |
|
|
$ |
17,904 |
|
|
4.03 |
% |
Allowance for loan losses |
(14,078 |
) |
|
|
|
|
|
(13,969 |
) |
|
|
|
|
|
(12,735 |
) |
|
|
|
|
Noninterest earning
assets |
115,245 |
|
|
|
|
|
|
112,130 |
|
|
|
|
|
|
101,545 |
|
|
|
|
|
Total assets |
$ |
1,995,607 |
|
|
|
|
|
|
$ |
1,954,760 |
|
|
|
|
|
|
$ |
1,865,629 |
|
|
|
|
|
Liabilities and Stockholders’ Equity |
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing transaction deposits |
$ |
795,390 |
|
|
$ |
986 |
|
|
0.50 |
% |
|
$ |
747,293 |
|
|
$ |
968 |
|
|
0.51 |
% |
|
$ |
753,617 |
|
|
$ |
962 |
|
|
0.52 |
% |
Time deposits |
335,629 |
|
|
1,506 |
|
|
1.81 |
% |
|
334,499 |
|
|
1,473 |
|
|
1.75 |
% |
|
334,759 |
|
|
1,334 |
|
|
1.62 |
% |
Total interest-bearing deposits |
1,131,019 |
|
|
2,492 |
|
|
0.89 |
% |
|
1,081,792 |
|
|
2,441 |
|
|
0.90 |
% |
|
1,088,376 |
|
|
2,296 |
|
|
0.86 |
% |
Junior subordinated debentures |
— |
|
|
— |
|
|
— |
% |
|
— |
|
|
— |
|
|
— |
% |
|
11,341 |
|
|
156 |
|
|
5.58 |
% |
Other borrowings |
80 |
|
|
— |
|
|
0.55 |
% |
|
— |
|
|
— |
|
|
— |
% |
|
— |
|
|
— |
|
|
— |
% |
Total interest-bearing liabilities |
1,131,099 |
|
|
$ |
2,492 |
|
|
0.89 |
% |
|
1,081,792 |
|
|
$ |
2,441 |
|
|
0.90 |
% |
|
1,099,717 |
|
|
$ |
2,452 |
|
|
0.90 |
% |
Noninterest-bearing liabilities: |
Noninterest-bearing deposits |
590,370 |
|
|
|
|
|
|
606,329 |
|
|
|
|
|
|
552,204 |
|
|
|
|
|
Accrued interest and other liabilities |
16,584 |
|
|
|
|
|
|
17,191 |
|
|
|
|
|
|
16,027 |
|
|
|
|
|
Total noninterest-bearing liabilities |
606,954 |
|
|
|
|
|
|
623,520 |
|
|
|
|
|
|
568,231 |
|
|
|
|
|
Stockholders’ equity |
257,554 |
|
|
|
|
|
|
249,448 |
|
|
|
|
|
|
197,681 |
|
|
|
|
|
Total liabilities and stockholders’ equity |
$ |
1,995,607 |
|
|
|
|
|
|
$ |
1,954,760 |
|
|
|
|
|
|
$ |
1,865,629 |
|
|
|
|
|
Net interest income |
|
|
$ |
16,088 |
|
|
|
|
|
|
$ |
16,343 |
|
|
|
|
|
|
$ |
15,452 |
|
|
|
Net interest spread |
|
|
|
|
3.00 |
% |
|
|
|
|
|
3.07 |
% |
|
|
|
|
|
3.13 |
% |
Net interest margin |
|
|
|
|
3.36 |
% |
|
|
|
|
|
3.45 |
% |
|
|
|
|
|
3.47 |
% |
Net interest margin
FTE(3) |
|
|
|
|
3.41 |
% |
|
|
|
|
|
3.50 |
% |
|
|
|
|
|
3.52 |
% |
Cost of deposits |
|
|
|
|
0.58 |
% |
|
|
|
|
|
0.57 |
% |
|
|
|
|
|
0.57 |
% |
Cost of funds |
|
|
|
|
0.53 |
% |
|
|
|
|
|
0.52 |
% |
|
|
|
|
|
0.56 |
% |
(1) |
Includes average outstanding balances of loans held for sale of
$4.2 million, $4.3 million, and $2.5 million for the three months
ended March 31, 2020, December 31, 2019, and March 31, 2019,
respectively. |
(2) |
Nonaccrual loans are included as loans carrying a zero yield. |
(3) |
Net interest margin FTE includes an FTE adjustment using a 21%
federal income tax rate on tax-exempt securities and tax-exempt
loans. |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|
(dollars in thousands, except
per share data) |
March 31, 2020 |
|
December 31, 2019 |
|
March 31, 2019 |
Tangible common equity |
|
|
|
|
|
Total stockholders' equity |
$ |
264,175 |
|
|
$ |
251,898 |
|
|
$ |
202,184 |
|
Adjustments: |
|
|
|
|
|
Intangible assets |
(1,546 |
) |
|
(1,546 |
) |
|
(1,546 |
) |
Total tangible common equity |
$ |
262,629 |
|
|
$ |
250,352 |
|
|
$ |
200,638 |
|
Common shares outstanding |
7,322,532 |
|
|
7,306,221 |
|
|
6,636,926 |
|
Book value per common
share |
$ |
36.08 |
|
|
$ |
34.48 |
|
|
$ |
30.46 |
|
Tangible book value per common
share |
$ |
35.87 |
|
|
$ |
34.27 |
|
|
$ |
30.23 |
|
|
|
|
|
|
|
Tangible assets |
|
|
|
|
|
Total assets |
$ |
2,010,701 |
|
|
$ |
1,988,225 |
|
|
$ |
1,922,118 |
|
Adjustments: |
|
|
|
|
|
Intangible assets |
(1,546 |
) |
|
(1,546 |
) |
|
(1,546 |
) |
Total tangible assets |
$ |
2,009,155 |
|
|
$ |
1,986,679 |
|
|
$ |
1,920,572 |
|
Total stockholder's equity to
total assets |
13.14 |
% |
|
12.67 |
% |
|
10.52 |
% |
Tangible common equity to
tangible assets |
13.07 |
% |
|
12.60 |
% |
|
10.45 |
% |
Contact:
Isabel V. Carriere, CPA, CGMA
Executive Vice President and Chief Financial Officer
318-561-4023
icarriere@redriverbank.net
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