Hampton Roads based TowneBank (the “Bank” or “Company”)
(NASDAQ:TOWN) today reported financial results for the full year
and the fourth quarter ended December 31, 2017. Earnings for
the fourth quarter were $12.33 million, or $0.20 per
diluted share, versus $19.0 million, or $0.31 per diluted
share, in fourth quarter 2016. Earnings in the fourth quarter
of 2017 included an expense of $10.11 million related to the
Tax Cuts and Jobs Act of 2017 and after-tax acquisition-related
expenses of $0.43 million. The impact from tax
legislation on fourth quarter 2017 earnings was primarily
attributable to revaluation of deferred tax assets at the lower
statutory tax rate.
Excluding merger-related expenses and adjustments related to tax
reform, earnings for the quarter ended December 31, 2017 were
$22.87 million (non-GAAP) compared to $18.55 million
(non-GAAP) in 2016. Fully diluted earnings per share,
excluding merger-related expenses and adjustments related to tax
reform, were $0.37 (non-GAAP) compared to $0.30 (non-GAAP) for
2016.
Earnings for the full year period were a record
$87.66 million, as compared to the $67.25 million
reported in 2016, representing a 30.35% increase. Fully
diluted earnings per share were $1.41 per share compared to $1.18
per share for 2016.
Excluding merger-related expenses, purchase accounting
adjustments, and adjustments related to tax reform, earnings for
the year ended December 31, 2017 were $97.18 million
(non-GAAP) compared to $80.15 million (non-GAAP) in
2016. Fully diluted earnings per share, excluding the
above-mentioned items, were $1.56 (non-GAAP) compared to $1.41
(non-GAAP) for 2016.
The Bank’s quarterly dividend was increased to $0.14 per share
beginning in the second quarter of 2017 resulting in total
dividends of $0.55 per share for 2017, an increase of 7.8% over
2016. On an annualized basis, the current annual dividend
rate is $0.56 per share.
“We are pleased to report our 18th consecutive year of record
annual earnings,” said G. Robert Aston, Jr., Chairman and Chief
Executive Officer. “With 20.09% revenue growth, representing
an increase of $75.14 million, and a return on average assets
of 1.05%, our financial performance has enabled us to reward our
shareholders while building a strong pathway to the future.
Our closing on the affiliation with Paragon Bank is scheduled to
occur on January 26, 2018 and will provide a substantial entry
into the robust Raleigh and Charlotte, North Carolina markets where
where Paragon recorded loan growth of over 20% last year.”
The following items affected comparability of
our fourth quarter 2017 earnings (in thousands):
|
|
Three Months Ended |
|
Three Months Ended |
|
|
December 31, 2017 |
|
December 31, 2016 |
(dollars
in thousands, except per share amounts) |
|
Net Income |
|
DilutedEarningsPer Share |
|
Net Income |
|
DilutedEarningsPer Share |
Net income (GAAP) |
|
$ |
12,333 |
|
|
$ |
0.20 |
|
|
$ |
18,996 |
|
|
$ |
0.31 |
|
After tax
acquisition-related expenses |
|
428 |
|
|
0.01 |
|
|
(443 |
) |
|
(0.01 |
) |
Income tax expense
related to tax reform legislation |
|
10,112 |
|
|
0.16 |
|
|
— |
|
|
— |
|
Net income, excluding
certain items affecting comparability (Non-GAAP) |
|
$ |
22,873 |
|
|
$ |
0.37 |
|
|
$ |
18,553 |
|
|
$ |
0.30 |
|
|
|
|
|
|
|
|
|
|
2017 Performance Highlights
• Total revenues were $449.24 million, an increase of
$75.14 million, or 20.09% from 2016
- Taxable equivalent net interest margin was 3.51%, including
accretion of 15 basis points, compared to 3.44%, including
accretion of 11 basis points, for 2016
- Property management fee revenue increased $6.81 million or
53.73%
- Residential mortgage banking income increased
$17.06 million, or 29.02%
- Insurance segment total revenue increased 10.44% to
$60.20 million
• Loans held for investment increased $139.74 million, or
2.41%, from December 31, 2016
• Total deposits were $6.45 billion, an increase of
$413.02 million, or 6.84%, from 2016
- Noninterest bearing deposits increased by 10.79%, to $2.16
billion, representing 33.46% of total deposits
- Total cost of deposits increased to 0.45% at December 31, 2017
from 0.40% at December 31, 2016
• Issued $250.0 million of fixed to variable rate
10-year subordinated notes at a fixed rate of 4.50% for the first
five years
- Issuance resulted in a reduction of 7 basis points to net
interest margin
- Treated as Tier 2 capital for regulatory purposes at December
31, 2017
• Asset quality showed continued strength
- Nonperforming assets declined to $28.09 million, or 0.33%
of total assets compared to $37.60 million, or 0.47%, at
December 31, 2016
- Nonperforming loans were 0.08% of period end loans
- Foreclosed property decreased to $19.82 million
• Strategic acquisitions
- On April 11, 2017, the Company acquired Railey Mountain Lake
Vacations, LLC, an independent resort property management company
at Deep Creek Lake, Maryland
- On April 27, 2017, the Company announced the signing of
agreement to acquire Paragon Commercial Corporation (“Paragon”) and
its wholly owned bank subsidiary, Paragon Commercial Bank, a
Raleigh, North Carolina-based bank with three banking offices
servicing Raleigh, Cary, and Charlotte, North Carolina. The
acquisition will close on January 26, 2018
- On August 1, 2017, the Company acquired W.A. Moore &
Company, an independent insurance agency in Greenville, North
Carolina
• The Bank remained well-capitalized
- Common equity tier 1 capital ratio of 12.19%
- Tier 1 leverage capital ratio of 10.17%
- Tier 1 risk-based capital ratio of 12.23%
- Total risk-based capital ratio of 16.48%
Fourth Quarter 2017 Earnings Compared to
Fourth Quarter 2016
Net income for the fourth quarter was $12.33 million, or
$0.20 per diluted share, versus $19.0 million, or
$0.31 per diluted share, in 2016. Excluding
merger-related expenses and adjustments related to tax reform,
earnings were $22.87 million (non-GAAP) compared to
$18.55 million (non-GAAP) in 2016, reflecting growth in net
interest income and noninterest income as compared to the prior
year period.
Performance Highlights
• Total revenues were $109.14 million, a $7.47
million, or 7.35%, increase from fourth quarter 2016
- Taxable equivalent net interest margin was 3.41%, including
accretion of 9 basis points, compared to 3.52%, including
accretion of 11 basis points in fourth quarter 2016
- Property management fee revenue increased $1.57 million,
or 134.82%
- Insurance segment total revenue increased $2.50 million to
$14.18 million
Net Interest IncomeNet interest income
increased to $65.66 million, a $3.51 million, or 5.65%,
increase from fourth quarter 2016. The primary driver was the
growth in average earning assets, which increased
$604.12 million, or 8.48%, while tax-equivalent net interest
margin decreased to 3.41% in the current quarter from 3.52% in
fourth quarter 2016. The subordinated note issuance in July
2017 resulted in additional interest expense of $2.88 million
in fourth quarter 2017 and a temporary reduction of 15 basis
points to net interest margin, as the Company continues the process
of leveraging the proceeds into earning assets. Accretion
income added $1.47 million, or 9 basis points, to margin
in the current quarter as compared to $2.34 million, or
15 basis points, in the fourth quarter of 2016.
Noninterest IncomeNoninterest income, excluding
gains or losses on investment securities, was $43.48 million
for the fourth quarter of 2017, an increase of $3.96 million,
or 10.02%, from the fourth quarter of 2016. In our Realty
segment, residential mortgage banking income decreased
$0.83 million, or 4.54%, from the fourth quarter of 2016
primarily due to lower production volumes. Mortgage
production was $837.32 million in fourth quarter 2017, a
decrease from fourth quarter 2016 production of
$1.01 billion. Insurance commissions and other title
fees increased $2.29 million, or 23.33%, primarily due to an
increase in contingent commission revenue combined with the
acquisition of an insurance agency in August 2017.
Additionally, real estate brokerage and property management income
increased $1.90 million, or 64.89%, from fourth quarter 2016
primarily due to our acquisition of a resort property management
company in second quarter 2017.
Noninterest ExpenseNoninterest expense
increased by $0.83 million, or 1.13%, from the fourth quarter
of 2016. The predominant driver was an increase in
noninterest expense of $2.30 million related to the Deep Creek
and insurance agency acquisitions, mainly in salaries and benefits
expense. The decrease was partially offset by lower salaries
and benefits expense primarily due to a decrease in profit sharing
expense, which included a reversal of $0.65 million due to a
change in estimate of previously accrued employee incentive
compensation unearned for the full year.
Fourth Quarter 2017 Earnings Compared to
Third Quarter 2017
Net income for the fourth quarter was $12.33 million, or $0.20
per diluted share, versus $27.15 million, or $0.44 per diluted
share, in third quarter 2017. Excluding merger-related
expenses and adjustments related to tax reform, earnings were
$22.87 million (non-GAAP) compared to $27.50 million
(non-GAAP) in third quarter 2017, primarily reflecting the
seasonality in our Realty segment.
Performance Highlights
• Total revenues were $109.14 million compared to
$115.34 million in the third quarter of 2017
- Taxable equivalent net interest margin was 3.41%, including
accretion of 9 basis points, compared to 3.43%, including
accretion of 12 basis points, in the third quarter of
2017
- Noninterest income decreased $5.94 million due to
seasonality in our Insurance and Realty segments
- Noninterest expense decreased $0.53 million, or 0.71%
• Total loans held for investment increased $36.49
million, or 2.43% on an annualized basis, from September 30,
2017
Net Interest IncomeOn a linked quarter basis,
net interest income decreased slightly by $0.26 million or 0.39%,
in fourth quarter 2017 versus third quarter 2017, while
tax-equivalent net interest margin was 3.41% versus 3.43% for the
third quarter of 2017. The decrease in net interest income
was primarily due to higher time deposit costs and interest expense
on the newly issued subordinated notes, combined with seasonally
lower loans held for sale average balances. The decrease was
partially offset by higher interest income from loans and
investment securities. Accretion income added
$1.47 million, or 9 basis points, to margin in the
current quarter, as compared to $2.36 million, or
12 basis points, in the linked quarter.
Noninterest IncomeIn comparison to the third
quarter of 2017, noninterest income decreased $5.94 million, or
12.02%. Residential mortgage banking income decreased by
$1.55 million, or 8.12%, from the third quarter of 2017
primarily due to a seasonal decrease in mortgage production of
$110.34 million, from $947.66 million in third quarter
2017 to $837.32 million in fourth quarter 2017. A
decrease of $5.22 million in real estate brokerage and
property management income from the linked quarter reflected the
seasonal nature of those businesses. Insurance commission
income was flat as a seasonal decrease in insurance policy renewals
was offset by an increase in contingent commission revenue.
Noninterest ExpenseNoninterest expense
decreased by $0.53 million, or 0.71%, from the third quarter
of 2017. The primary driver was a decrease in salaries and
benefits expenses of $0.99 million, primarily due to a
reduction in profit sharing expense, which was partially offset by
an increase in expenses related to employee retirement plans.
Noninterest
Income |
|
|
|
|
|
|
% Change |
|
Q4 |
|
Q4 |
|
Q3 |
|
Q4 17 vs. |
|
Q4 17 vs. |
(dollars in
thousands) |
2017 |
|
2016 |
|
2017 |
|
Q4 16 |
|
Q3 17 |
Residential mortgage
banking income, net |
$ |
17,537 |
|
|
$ |
18,096 |
|
|
$ |
19,087 |
|
|
(3.09 |
)% |
|
(8.12 |
)% |
Insurance commissions
and other title fees and income, net |
12,115 |
|
|
9,823 |
|
|
12,116 |
|
|
23.33 |
% |
|
(0.01 |
)% |
Real estate brokerage
and property management, net |
4,823 |
|
|
2,925 |
|
|
10,042 |
|
|
64.89 |
% |
|
(51.97 |
)% |
Service charges on
deposit accounts |
2,809 |
|
|
2,535 |
|
|
2,670 |
|
|
10.81 |
% |
|
5.21 |
% |
Credit card merchant
fees, net |
1,204 |
|
|
1,135 |
|
|
1,388 |
|
|
6.08 |
% |
|
(13.26 |
)% |
Bank owned life
insurance |
1,941 |
|
|
2,377 |
|
|
1,425 |
|
|
(18.34 |
)% |
|
36.21 |
% |
Other income |
3,048 |
|
|
2,621 |
|
|
2,688 |
|
|
16.29 |
% |
|
13.39 |
% |
Subtotal before gain on
investment securities |
43,477 |
|
|
39,512 |
|
|
49,416 |
|
|
10.03 |
% |
|
(12.02 |
)% |
Net gain on investment
securities |
— |
|
|
6 |
|
|
— |
|
|
N/M |
|
|
N/M |
|
Total noninterest
income |
$ |
43,477 |
|
|
$ |
39,518 |
|
|
$ |
49,416 |
|
|
10.02 |
% |
|
(12.02 |
)% |
Noninterest
Expense |
|
|
|
|
|
|
% Change |
|
Q4 |
|
Q4 |
|
Q3 |
|
Q4 17 vs. |
|
Q4 17 vs. |
(dollars in
thousands) |
2017 |
|
2016 |
|
2017 |
|
Q4 16 |
|
Q3 17 |
Salaries and
benefits |
$ |
42,480 |
|
|
$ |
43,071 |
|
|
$ |
43,467 |
|
|
(1.37 |
)% |
|
(2.27 |
)% |
Occupancy expense |
6,878 |
|
|
6,885 |
|
|
6,635 |
|
|
(0.10 |
)% |
|
3.66 |
% |
Furniture and
equipment |
3,456 |
|
|
3,378 |
|
|
3,710 |
|
|
2.31 |
% |
|
(6.85 |
)% |
Acquisition-related
expenses |
526 |
|
|
(707 |
) |
|
466 |
|
|
(174.40 |
)% |
|
12.88 |
% |
Other expenses |
20,320 |
|
|
20,207 |
|
|
19,908 |
|
|
0.56 |
% |
|
2.07 |
% |
Total noninterest
expense |
$ |
73,660 |
|
|
$ |
72,834 |
|
|
$ |
74,186 |
|
|
1.13 |
% |
|
(0.71 |
)% |
|
|
|
|
|
|
|
|
|
|
Segment
Results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ Change |
(in thousands) |
|
Q4 |
|
Q4 |
|
Q3 |
|
Q4 17 vs. |
|
Q4 17 vs. |
Segment
Net Income (Loss) |
|
2017 |
|
2016 |
|
2017 |
|
Q4 16 |
|
Q3 17 |
Banking |
|
$ |
11,530 |
|
|
$ |
17,931 |
|
|
$ |
22,569 |
|
|
$ |
(6,401 |
) |
|
$ |
(11,039 |
) |
Realty |
|
(224 |
) |
|
673 |
|
|
3,445 |
|
|
(897 |
) |
|
(3,669 |
) |
Insurance |
|
1,027 |
|
|
392 |
|
|
1,136 |
|
|
635 |
|
|
(109 |
) |
Total net income |
|
$ |
12,333 |
|
|
$ |
18,996 |
|
|
$ |
27,150 |
|
|
$ |
(6,663 |
) |
|
$ |
(14,817 |
) |
Fourth Quarter 2017 Compared to Fourth Quarter
2016
BankingNet income for the three months ended
December 31, 2017 for the Banking segment was $11.53 million,
decreasing $6.40 million, or 35.70%, from comparative 2016.
This reduction in net income was primarily due to a significant
increase of $12.96 million in the provision for income tax expense,
mostly due to the tax reform legislation. Partially
offsetting this increase was a rise in net interest income of
$3.55 million due to an increase in earning assets and a
slight increase in noninterest income of $0.53 million.
A reduction in the provision for loan losses of $0.93 million and a
decrease in noninterest expenses of $1.53 million also partially
offset the decrease in net income.
RealtyFor the three months ended December 31,
2017, the Realty segment results decreased to a loss of
$0.22 million from income of $0.67 million for fourth quarter
2016. The reduction was driven by a decrease in residential
mortgage banking income of $0.83 million, or 4.54%, an increase in
total expenses of $1.13 million, and increase of $0.81 million
in the provision for income tax expense. The Deep Creek
acquisition resulted in an increase in property management fees of
$1.57 million and an increase in noninterest expense of
$1.74 million.
InsuranceThe Insurance segment had net income
of $1.03 million for the three months ended December 31, 2017, an
increase of $0.64 million compared to fourth quarter
2016. The increase in net income was driven by higher
property and casualty insurance commission income and contingency
and bonus revenue.
Fourth Quarter 2017 Compared to Third Quarter
2017
BankingEarnings decreased by
$11.04 million, or 48.91% from the third quarter of 2017 as an
increase in revenue was overcome by an increase in the provision
for income tax expense of $10.51 million, primarily related to
the tax reform legislation, and an increase in noninterest expense
of $1.44 million.
RealtyNet income in the Realty segment
decreased by $3.67 million from the linked quarter ended
September 30, 2017, due to seasonal decreases in the Bank's
mortgage, real estate brokerage, and resort property management
businesses. The seasonal decrease in revenue was partially
offset by a decline in operating expenses during the current
quarter.
InsuranceNet income decreased slightly by
$0.11 million from the third quarter of 2017 due to an
increase in operating expenses during the current quarter.
The increase was mostly offset by higher net revenues as an
increase in contingent commission revenue was only partially offset
by the seasonal decrease in fourth quarter policy renewals.
Balance Sheet
At December 31, 2017, total Bank assets reached $8.52 billion,
an increase of $0.55 billion, or 6.88%, over December 31, 2016.
Loans
|
|
|
|
|
|
|
% Change |
|
Q4 |
|
Q4 |
|
Q3 |
|
Q4 17 vs. |
|
Q4 17 vs. |
(dollars in
thousands) |
2017 |
|
2016 |
|
2017 |
|
Q4 16 |
|
Q3 17 |
Construction and land
development |
$ |
930,426 |
|
|
$ |
826,027 |
|
|
$ |
880,655 |
|
|
12.64 |
% |
|
5.65 |
% |
Commercial real estate
- investment related properties |
1,344,774 |
|
|
1,322,466 |
|
|
1,336,277 |
|
|
1.69 |
% |
|
0.64 |
% |
Commercial real estate
- owner occupied |
938,767 |
|
|
928,846 |
|
|
966,986 |
|
|
1.07 |
% |
|
(2.92 |
)% |
Multifamily real
estate |
198,720 |
|
|
222,791 |
|
|
185,323 |
|
|
(10.80 |
)% |
|
7.23 |
% |
1-4 family residential
real estate |
1,217,349 |
|
|
1,215,823 |
|
|
1,239,886 |
|
|
0.13 |
% |
|
(1.82 |
)% |
Commercial and
industrial business loans |
1,087,157 |
|
|
1,089,539 |
|
|
1,084,555 |
|
|
(0.22 |
)% |
|
0.24 |
% |
Consumer loans and
other |
229,772 |
|
|
201,729 |
|
|
216,797 |
|
|
13.90 |
% |
|
5.98 |
% |
Total |
$ |
5,946,965 |
|
|
$ |
5,807,221 |
|
|
$ |
5,910,479 |
|
|
2.41 |
% |
|
0.62 |
% |
The Bank’s loan portfolio ended the period at $5.95 billion
representing an increase of 2.41%, or $139.74 million, from
December 31, 2016, and an increase of $36.49 million, or
0.62%, from September 30, 2017.
Deposits
|
|
|
|
|
|
|
% Change |
|
Q4 |
|
Q4 |
|
Q3 |
|
Q4 17 vs. |
|
Q4 17 vs. |
(dollars in
thousands) |
2017 |
|
2016 |
|
2017 |
|
Q4 16 |
|
Q3 17 |
Noninterest-bearing
demand |
$ |
2,157,338 |
|
|
$ |
1,947,312 |
|
|
$ |
2,212,047 |
|
|
10.79 |
% |
|
(2.47 |
)% |
Interest-bearing: |
|
|
|
|
|
|
|
|
|
Demand
and money market accounts |
2,225,211 |
|
|
2,263,894 |
|
|
2,253,746 |
|
|
(1.71 |
)% |
|
(1.27 |
)% |
Savings |
315,889 |
|
|
319,611 |
|
|
320,028 |
|
|
(1.16 |
)% |
|
(1.29 |
)% |
Certificates of deposits |
1,749,782 |
|
|
1,504,380 |
|
|
1,762,641 |
|
|
16.31 |
% |
|
(0.73 |
)% |
Total |
$ |
6,448,220 |
|
|
$ |
6,035,197 |
|
|
$ |
6,548,462 |
|
|
6.84 |
% |
|
(1.53 |
)% |
The Bank experienced solid deposit growth with total deposits
increasing to $6.45 billion, up $0.41 billion, or 6.84%,
from December 31, 2016. The Bank saw continued growth in
noninterest-bearing demand deposits, which ended the year at
$2.16 billion, a 10.79% increase from the prior year.
Noninterest-bearing deposits represented 33.46% of total deposits
at December 31, 2017.
Capital Ratios
|
|
Q4 |
|
Q4 |
|
Q3 |
|
|
2017 |
|
2016 |
|
2017 |
Common Equity Tier
1 |
|
12.19 |
% |
|
11.75 |
% |
|
12.36 |
% |
Tier 1 |
|
12.23 |
% |
|
11.82 |
% |
|
12.40 |
% |
Total |
|
16.48 |
% |
|
12.44 |
% |
|
16.71 |
% |
Tier 1
Leverage Ratio |
|
10.17 |
% |
|
10.44 |
% |
|
10.14 |
% |
Note - Current quarter
regulatory capital information is preliminary. |
|
|
|
|
|
|
The Bank’s total equity at December 31, 2017 rose to $1.14
billion, an increase of $55.95 million, or 5.15%, from December 31,
2016. Total risk-based capital remained strong as common
equity Tier 1, Tier 1 capital, total risk-based capital,
and Tier 1 leverage capital ratios were 12.19%, 12.23%,
16.48%, 10.17%, respectively. All ratios exceed the current
regulatory standards for well capitalized status.
Asset Quality
|
|
|
|
|
|
|
|
|
|
(in thousands) |
12/31/2017 |
|
9/30/2017 |
|
6/30/2017 |
|
3/31/2017 |
|
12/31/2016 |
|
|
|
|
|
|
|
|
|
|
Nonperforming
loans |
$ |
4,807 |
|
|
$ |
8,768 |
|
|
$ |
9,645 |
|
|
$ |
11,538 |
|
|
$ |
13,099 |
|
Former bank
premises |
3,469 |
|
|
3,619 |
|
|
2,798 |
|
|
2,798 |
|
|
3,494 |
|
Foreclosed
property |
19,818 |
|
|
21,504 |
|
|
23,249 |
|
|
21,473 |
|
|
21,011 |
|
|
|
|
|
|
|
|
|
|
|
Total nonperforming
assets |
$ |
28,094 |
|
|
$ |
33,891 |
|
|
$ |
35,692 |
|
|
$ |
35,809 |
|
|
$ |
37,604 |
|
|
|
|
|
|
|
|
|
|
|
Quarterly net loans
charged off (recovered) |
$ |
136 |
|
|
$ |
429 |
|
|
$ |
384 |
|
|
$ |
1,347 |
|
|
$ |
485 |
|
|
|
|
|
|
|
|
|
|
|
Year-to-date net loans
charged off |
$ |
2,296 |
|
|
$ |
2,160 |
|
|
$ |
1,731 |
|
|
$ |
1,347 |
|
|
$ |
1,715 |
|
|
|
|
|
|
|
|
|
Change |
|
|
Q4 |
|
Q4 |
|
Q3 |
|
Q4 2017 vs. |
|
Q4 2017 vs. |
(dollars in
thousands) |
|
2017 |
|
2016 |
|
2017 |
|
Q4 2016 |
|
Q3 2017 |
Total loans 90 days
past due and still accruing |
|
$ |
103 |
|
|
$ |
76 |
|
|
$ |
74 |
|
|
$ |
27 |
|
|
$ |
29 |
|
Total loans 30-89 days
past due |
|
$ |
5,962 |
|
|
$ |
10,459 |
|
|
$ |
5,888 |
|
|
$ |
(4,497 |
) |
|
$ |
74 |
|
Allowance for loan
losses |
|
$ |
45,131 |
|
|
$ |
42,001 |
|
|
$ |
44,398 |
|
|
$ |
3,130 |
|
|
$ |
733 |
|
Total performing
TDRs |
|
$ |
24,832 |
|
|
$ |
31,351 |
|
|
$ |
22,280 |
|
|
$ |
(6,519 |
) |
|
$ |
2,552 |
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming loans to
period end loans |
|
0.08 |
% |
|
0.23 |
% |
|
0.15 |
% |
|
(0.15 |
) |
|
(0.07 |
) |
Nonperforming assets to
period end assets |
|
0.33 |
% |
|
0.47 |
% |
|
0.39 |
% |
|
(0.14 |
) |
|
(0.06 |
) |
Allowance for loan
losses to period end loans |
|
0.76 |
% |
|
0.72 |
% |
|
0.75 |
% |
|
0.04 |
|
|
0.01 |
|
Allowance for loan
losses (originated) to originated period end loans |
|
0.86 |
% |
|
0.87 |
% |
|
0.86 |
% |
|
(0.01 |
) |
|
— |
|
Net charge-offs
(recoveries) to average loans (annualized) |
|
0.01 |
% |
|
0.03 |
% |
|
0.03 |
% |
|
(0.02 |
) |
|
(0.02 |
) |
Ratio of allowance for
loan losses to nonperforming loans |
|
9.39x |
|
|
3.21x |
|
|
5.06x |
|
|
6.18x |
|
|
4.33x |
|
Continued strength in credit quality contributed to the Bank's
financial results as net charge-offs totaled $0.14 million in
the fourth quarter of 2017 compared to $0.49 million in the
fourth quarter of 2016 and $0.43 million in the linked
quarter. Total nonperforming assets were $28.09 million,
or 0.33%, of Bank assets at December 31, 2017, as compared to
$37.60 million, or 0.47%, at December 31, 2016, and
$33.89 million, or 0.39%, at September 30, 2017.
The allowance for loan losses was $45.13 million, increased from
$42.0 million at December 31, 2016 and $44.40 million at
September 30, 2017.
About TowneBank:As one of the
top community banks in Virginia and North Carolina, TowneBank
operates 37 banking offices serving Chesapeake, Chesterfield
County, Glen Allen, Hampton, James City County, Mechanicsville,
Newport News, Norfolk, Portsmouth, Richmond, Suffolk, Virginia
Beach, Williamsburg, and York County in Virginia, along with
Moyock, Grandy, Camden County, Southern Shores, Corolla and Nags
Head in North Carolina. Towne also offers a full range of
financial services through its controlled divisions and
subsidiaries that include Towne Investment Group, Towne Wealth
Management, Towne Insurance Agency, Towne Benefits, TowneBank
Mortgage, TowneBank Commercial Mortgage, Berkshire Hathaway
HomeServices Towne Realty, Towne 1031 Exchange, LLC, and Towne
Vacations. Local decision-making is a hallmark of its
hometown banking strategy that is delivered through the leadership
of each group’s President and Board of Directors. With total
assets of $8.52 billion as of December 31, 2017,
TowneBank is one of the largest banks headquartered in
Virginia.
On April 27, 2017, TowneBank announced the signing of a
definitive agreement to acquire Paragon Commercial Corporation
(“Paragon”) and its wholly-owned bank subsidiary, Paragon
Commercial Bank. Founded in Raleigh, North Carolina in 1999,
Paragon Commercial Bank provides banking services through highly
responsive professionals, an extensive courier service, online and
mobile technologies, free worldwide ATM access and a select number
of strategically placed offices in Raleigh, Cary and Charlotte,
North Carolina. All customary regulatory and shareholder
approvals have been obtained and the merger is scheduled to close
in January 2018. Based on financial data as of September
30, 2017, the combined company would have total assets of
$10.4 billion, gross loans of $7.3 billion and total
deposits of $7.8 billion.
Non-GAAP Financial Measures:This press release
contains financial information determined by methods other than in
accordance with GAAP. The Company's management uses these
non-GAAP financial measures in their analysis of the Company's
performance. These measures typically adjust GAAP performance
measures to exclude the effects of the amortization of intangibles
and include the tax benefit associated with revenue items that are
tax-exempt, as well as adjust income available to common
shareholders for certain significant activities or transactions
that are infrequent in nature. Since the presentation of
these GAAP performance measures and their impact differ between
companies, management believes presentations of these non-GAAP
financial measures provide useful supplemental information that is
essential to a proper understanding of the operating results of the
Company’s core businesses. These non-GAAP disclosures should
not be viewed as a substitute for operating results determined in
accordance with GAAP, nor are they necessarily comparable to
non-GAAP performance measures that may be presented by other
companies. Reconciliations of GAAP to non-GAAP disclosures are
included as tables at the end of this release.
Forward-Looking Statements:Certain statements
contained in this release constitute forward-looking statements
within the meaning of U.S. federal securities laws. These
forward-looking statements speak only as of the date of this
release, are based on current expectations, and involve a number of
assumptions. These include statements regarding TowneBank’s future
economic performance, financial condition, prospects, growth,
strategies and expectations, and objectives of management, and are
generally identified by the use of words such as “believe,”
“expect,” “intend,” “anticipate,” “estimate,” or “project” or
similar expressions. TowneBank intends such forward-looking
statements to be covered by the safe harbor provisions for
forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995 and is including this statement for
purposes of these safe harbor provisions. You should not place
undue reliance on forward-looking statements, which are subject to
assumptions that are subject to change. TowneBank’s ability to
predict results, or the actual effect of future plans or
strategies, is inherently uncertain. These forward-looking
statements are subject to a number of factors and uncertainties
that could cause actual results to differ from those indicated or
implied in the forward-looking statements and such differences may
be material. Factors which could have a material effect on
the operations and future prospects of TowneBank include but are
not limited to: changes in interest rates, general economic and
business conditions; legislative/regulatory changes; the monetary
and fiscal policies of the U.S. government, including policies of
the U.S. Treasury and the Board of Governors of the Federal Reserve
System; the quality and composition of TowneBank’s loan and
securities portfolios; demand for loan products; deposit flows;
competition; demand for financial services in TowneBank’s market
area; implementation of new technologies and the ability to develop
and maintain secure and reliable electronic systems; changes in the
securities markets; changes in accounting principles, policies and
guidelines; TowneBank’s ability to complete and successfully
integrate the business of Paragon Commercial Bank in the expected
timeframe, if at all, and to achieve expected revenue synergies and
cost savings from the merger; and other risk factors detailed from
time to time in filings made by TowneBank with the Federal Deposit
Insurance Corporation (the “FDIC”). TowneBank undertakes no
obligation to update or clarify these forward-looking statements,
whether as a result of new information, future events or
otherwise.
|
TOWNEBANK |
Selected Financial Highlights
(unaudited) |
(dollars in thousands, except per share
data) |
|
|
|
|
|
|
Increase/ |
|
% Increase/ |
Three Months
Ended December 31, |
2017 |
|
2016 |
|
(Decrease) |
|
(Decrease) |
|
|
|
|
|
|
|
|
Results of
Operations: |
|
|
|
|
|
|
|
Net
interest income |
$ |
65,664 |
|
|
$ |
62,151 |
|
|
$ |
3,513 |
|
|
5.65 |
% |
Noninterest income |
43,477 |
|
|
39,518 |
|
|
3,959 |
|
|
10.02 |
% |
Total
Revenue |
109,141 |
|
|
101,669 |
|
|
7,472 |
|
|
7.35 |
% |
Acquisition-related expenses |
526 |
|
|
(707 |
) |
|
1,233 |
|
|
(174.40 |
)% |
Noninterest expenses, excluding acquisition-related expenses |
73,134 |
|
|
73,541 |
|
|
(407 |
) |
|
(0.55 |
)% |
Provision
for loan losses |
869 |
|
|
1,831 |
|
|
(962 |
) |
|
(52.54 |
)% |
Income
before income tax and noncontrolling interest |
34,612 |
|
|
27,004 |
|
|
7,608 |
|
|
28.17 |
% |
Provision
for income tax expense |
21,325 |
|
|
7,160 |
|
|
14,165 |
|
|
197.84 |
% |
Net
income |
13,287 |
|
|
19,844 |
|
|
(6,557 |
) |
|
(33.04 |
)% |
Net
income attributable to noncontrolling interest |
(954 |
) |
|
(848 |
) |
|
(106 |
) |
|
12.50 |
% |
Net
income attributable to TowneBank |
12,333 |
|
|
18,996 |
|
|
(6,663 |
) |
|
(35.08 |
)% |
Net
income available to common shareholders |
12,333 |
|
|
18,996 |
|
|
(6,663 |
) |
|
(35.08 |
)% |
Net
income per common share - basic |
0.20 |
|
|
0.31 |
|
|
(0.11 |
) |
|
(35.48 |
)% |
Net income per common share - diluted |
0.20 |
|
|
0.31 |
|
|
(0.11 |
) |
|
(35.48 |
)% |
Period End
Data: |
|
|
|
|
|
|
|
Total
assets |
$ |
8,522,176 |
|
|
$ |
7,973,915 |
|
|
$ |
548,261 |
|
|
6.88 |
% |
Total
assets - tangible |
8,213,358 |
|
|
7,671,149 |
|
|
542,209 |
|
|
7.07 |
% |
Earning
assets |
7,706,747 |
|
|
7,157,391 |
|
|
549,356 |
|
|
7.68 |
% |
Loans
(net of unearned income) |
5,946,965 |
|
|
5,807,221 |
|
|
139,744 |
|
|
2.41 |
% |
Allowance
for loan losses |
45,131 |
|
|
42,001 |
|
|
3,130 |
|
|
7.45 |
% |
Goodwill
and other intangibles |
308,819 |
|
|
302,766 |
|
|
6,053 |
|
|
2.00 |
% |
Nonperforming assets |
28,094 |
|
|
37,605 |
|
|
(9,511 |
) |
|
(25.29 |
)% |
Noninterest bearing deposits |
2,157,338 |
|
|
1,947,312 |
|
|
210,026 |
|
|
10.79 |
% |
Interest
bearing deposits |
4,290,882 |
|
|
4,087,885 |
|
|
202,997 |
|
|
4.97 |
% |
Total
deposits |
6,448,220 |
|
|
6,035,197 |
|
|
413,023 |
|
|
6.84 |
% |
Total
equity |
1,142,505 |
|
|
1,086,558 |
|
|
55,947 |
|
|
5.15 |
% |
Total
equity - tangible |
833,686 |
|
|
783,792 |
|
|
49,894 |
|
|
6.37 |
% |
Common
equity |
1,131,240 |
|
|
1,075,102 |
|
|
56,138 |
|
|
5.22 |
% |
Common
equity - tangible |
822,421 |
|
|
772,337 |
|
|
50,084 |
|
|
6.48 |
% |
Book
value per common share |
18.06 |
|
|
17.20 |
|
|
0.86 |
|
|
5.00 |
% |
Book value per common share - tangible |
13.13 |
|
|
12.36 |
|
|
0.77 |
|
|
6.23 |
% |
Daily Average
Balances: |
|
|
|
|
|
|
|
Total
assets |
$ |
8,579,705 |
|
|
$ |
7,965,438 |
|
|
$ |
614,267 |
|
|
7.71 |
% |
Total
assets - tangible |
8,269,760 |
|
|
7,661,845 |
|
|
607,915 |
|
|
7.93 |
% |
Earning
assets |
7,729,862 |
|
|
7,125,742 |
|
|
604,120 |
|
|
8.48 |
% |
Loans
(net of unearned income), excluding nonaccrual loans |
5,920,302 |
|
|
5,705,832 |
|
|
214,470 |
|
|
3.76 |
% |
Allowance
for loan losses |
44,704 |
|
|
41,188 |
|
|
3,516 |
|
|
8.54 |
% |
Goodwill
and other intangibles |
309,946 |
|
|
303,593 |
|
|
6,353 |
|
|
2.09 |
% |
Noninterest bearing deposits |
2,162,271 |
|
|
1,961,902 |
|
|
200,369 |
|
|
10.21 |
% |
Interest
bearing deposits |
4,336,175 |
|
|
4,137,806 |
|
|
198,369 |
|
|
4.79 |
% |
Total
deposits |
6,498,446 |
|
|
6,099,708 |
|
|
398,738 |
|
|
6.54 |
% |
Total
equity |
1,149,888 |
|
|
1,087,382 |
|
|
62,506 |
|
|
5.75 |
% |
Total
equity - tangible |
839,942 |
|
|
783,789 |
|
|
56,153 |
|
|
7.16 |
% |
Common
equity |
1,138,936 |
|
|
1,076,277 |
|
|
62,659 |
|
|
5.82 |
% |
Common equity - tangible |
828,991 |
|
|
772,683 |
|
|
56,308 |
|
|
7.29 |
% |
Key
Ratios: |
|
|
|
|
|
|
|
Return on
average assets (1) |
0.57 |
% |
|
0.95 |
% |
|
(0.38 |
)% |
|
(40.00 |
)% |
Return on
average assets - tangible (1) |
0.65 |
% |
|
1.05 |
% |
|
(0.40 |
)% |
|
(38.10 |
)% |
Return on
average equity (1) |
4.26 |
% |
|
6.95 |
% |
|
(2.69 |
)% |
|
(38.71 |
)% |
Return on
average equity - tangible (1) |
6.39 |
% |
|
10.27 |
% |
|
(3.88 |
)% |
|
(37.78 |
)% |
Return on
average common equity (1) |
4.30 |
% |
|
7.02 |
% |
|
(2.72 |
)% |
|
(38.75 |
)% |
Return on
average common equity - tangible (1) |
6.47 |
% |
|
10.42 |
% |
|
(3.95 |
)% |
|
(37.91 |
)% |
Net
interest margin-fully tax equivalent (2) |
3.41 |
% |
|
3.52 |
% |
|
(0.11 |
)% |
|
(3.13 |
)% |
Net
interest margin |
3.37 |
% |
|
3.47 |
% |
|
(0.10 |
)% |
|
(2.88 |
)% |
Average
earning assets/total average assets |
90.09 |
% |
|
89.46 |
% |
|
0.63 |
% |
|
0.70 |
% |
Average
loans/average deposits |
91.10 |
% |
|
93.54 |
% |
|
(2.44 |
)% |
|
(2.61 |
)% |
Average
noninterest deposits/total average deposits |
33.27 |
% |
|
32.16 |
% |
|
1.11 |
% |
|
3.45 |
% |
Allowance
for loan losses/period end loans |
0.76 |
% |
|
0.72 |
% |
|
0.04 |
% |
|
5.56 |
% |
Nonperforming assets to period end assets |
0.33 |
% |
|
0.47 |
% |
|
(0.14 |
)% |
|
(29.79 |
)% |
Period
end equity/period end total assets |
13.41 |
% |
|
13.63 |
% |
|
(0.22 |
)% |
|
(1.61 |
)% |
Efficiency ratio |
67.49 |
% |
|
71.64 |
% |
|
(4.15 |
)% |
|
(5.79 |
)% |
|
|
|
|
|
|
|
|
(1)
Annualized |
(2)
Presented on a tax-equivalent basis |
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Selected Financial Highlights
(unaudited) |
(dollars in thousands, except per share
data) |
|
|
|
|
|
|
Increase/ |
|
% Increase/ |
Twelve Months
Ended December 31, |
2017 |
|
2016 |
|
(Decrease) |
|
(Decrease) |
|
|
|
|
|
|
|
|
Results of
Operations: |
|
|
|
|
|
|
|
Net
interest income |
$ |
261,121 |
|
|
$ |
218,876 |
|
|
$ |
42,245 |
|
|
19.30 |
% |
Noninterest income |
188,121 |
|
|
155,222 |
|
|
32,899 |
|
|
21.19 |
% |
Total
Revenue |
449,242 |
|
|
374,098 |
|
|
75,144 |
|
|
20.09 |
% |
Acquisition-related expenses |
2,268 |
|
|
19,111 |
|
|
(16,843 |
) |
|
(88.13 |
)% |
Noninterest expenses, excluding acquisition-related expenses |
293,946 |
|
|
248,717 |
|
|
45,229 |
|
|
18.18 |
% |
Provision
for loan losses |
5,426 |
|
|
5,357 |
|
|
69 |
|
|
1.29 |
% |
Income
before income tax and noncontrolling interest |
147,602 |
|
|
100,913 |
|
|
46,689 |
|
|
46.27 |
% |
Provision
for income tax expense |
54,813 |
|
|
28,698 |
|
|
26,115 |
|
|
91.00 |
% |
Net
income |
92,789 |
|
|
72,215 |
|
|
20,574 |
|
|
28.49 |
% |
Net
income attributable to noncontrolling interest |
(5,126 |
) |
|
(4,965 |
) |
|
(161 |
) |
|
3.24 |
% |
Net
income attributable to TowneBank |
87,663 |
|
|
67,250 |
|
|
20,413 |
|
|
30.35 |
% |
Net
income available to common shareholders |
87,663 |
|
|
67,250 |
|
|
20,413 |
|
|
30.35 |
% |
Net
income per common share - basic |
1.41 |
|
|
1.18 |
|
|
0.23 |
|
|
19.49 |
% |
Net income per common share - diluted |
1.41 |
|
|
1.18 |
|
|
0.23 |
|
|
19.49 |
% |
Period End
Data: |
|
|
|
|
|
|
|
Total
assets |
$ |
8,522,176 |
|
|
$ |
7,973,915 |
|
|
$ |
548,261 |
|
|
6.88 |
% |
Total
assets - tangible |
8,213,358 |
|
|
7,671,149 |
|
|
542,209 |
|
|
7.07 |
% |
Earning
assets |
7,706,747 |
|
|
7,157,391 |
|
|
549,356 |
|
|
7.68 |
% |
Loans
(net of unearned income) |
5,946,965 |
|
|
5,807,221 |
|
|
139,744 |
|
|
2.41 |
% |
Allowance
for loan losses |
45,131 |
|
|
42,001 |
|
|
3,130 |
|
|
7.45 |
% |
Goodwill
and other intangibles |
308,819 |
|
|
302,766 |
|
|
6,053 |
|
|
2.00 |
% |
Nonperforming assets |
28,094 |
|
|
37,605 |
|
|
(9,511 |
) |
|
(25.29 |
)% |
Noninterest bearing deposits |
2,157,338 |
|
|
1,947,312 |
|
|
210,026 |
|
|
10.79 |
% |
Interest
bearing deposits |
4,290,882 |
|
|
4,087,885 |
|
|
202,997 |
|
|
4.97 |
% |
Total
deposits |
6,448,220 |
|
|
6,035,197 |
|
|
413,023 |
|
|
6.84 |
% |
Total
equity |
1,142,505 |
|
|
1,086,558 |
|
|
55,947 |
|
|
5.15 |
% |
Total
equity - tangible |
833,686 |
|
|
783,792 |
|
|
49,894 |
|
|
6.37 |
% |
Common
equity |
1,131,240 |
|
|
1,075,102 |
|
|
56,138 |
|
|
5.22 |
% |
Common
equity - tangible |
822,421 |
|
|
772,337 |
|
|
50,084 |
|
|
6.48 |
% |
Book
value per common share |
18.06 |
|
|
17.20 |
|
|
0.86 |
|
|
5.00 |
% |
Book value per common share - tangible |
13.13 |
|
|
12.36 |
|
|
0.77 |
|
|
6.23 |
% |
Daily Average
Balances: |
|
|
|
|
|
|
|
Total
assets |
$ |
8,334,999 |
|
|
$ |
7,205,236 |
|
|
$ |
1,129,763 |
|
|
15.68 |
% |
Total
assets - tangible |
8,027,381 |
|
|
6,958,267 |
|
|
1,069,114 |
|
|
15.36 |
% |
Earning
assets |
7,517,473 |
|
|
6,442,385 |
|
|
1,075,088 |
|
|
16.69 |
% |
Loans
(net of unearned income), excluding nonaccrual loans |
5,901,797 |
|
|
5,129,990 |
|
|
771,807 |
|
|
15.05 |
% |
Allowance
for loan losses |
43,760 |
|
|
39,547 |
|
|
4,213 |
|
|
10.65 |
% |
Goodwill
and other intangibles |
307,618 |
|
|
246,968 |
|
|
60,650 |
|
|
24.56 |
% |
Noninterest bearing deposits |
2,094,753 |
|
|
1,720,093 |
|
|
374,660 |
|
|
21.78 |
% |
Interest
bearing deposits |
4,248,571 |
|
|
3,852,100 |
|
|
396,471 |
|
|
10.29 |
% |
Total
deposits |
6,343,324 |
|
|
5,572,192 |
|
|
771,132 |
|
|
13.84 |
% |
Total
equity |
1,123,588 |
|
|
963,775 |
|
|
159,813 |
|
|
16.58 |
% |
Total
equity - tangible |
815,969 |
|
|
716,807 |
|
|
99,162 |
|
|
13.83 |
% |
Common
equity |
1,112,499 |
|
|
953,669 |
|
|
158,830 |
|
|
16.65 |
% |
Common equity - tangible |
804,881 |
|
|
706,701 |
|
|
98,180 |
|
|
13.89 |
% |
Key
Ratios: |
|
|
|
|
|
|
|
Return on
average assets |
1.05 |
% |
|
0.93 |
% |
|
0.12 |
% |
|
12.90 |
% |
Return on
average assets - tangible |
1.15 |
% |
|
1.02 |
% |
|
0.13 |
% |
|
12.75 |
% |
Return on
average equity |
7.80 |
% |
|
6.98 |
% |
|
0.82 |
% |
|
11.75 |
% |
Return on
average equity - tangible |
11.35 |
% |
|
9.93 |
% |
|
1.42 |
% |
|
14.30 |
% |
Return on
average common equity |
7.88 |
% |
|
7.05 |
% |
|
0.83 |
% |
|
11.77 |
% |
Return on
average common equity - tangible |
11.51 |
% |
|
10.07 |
% |
|
1.44 |
% |
|
14.30 |
% |
Net
interest margin-fully tax equivalent (1) |
3.51 |
% |
|
3.44 |
% |
|
0.07 |
% |
|
2.03 |
% |
Net
interest margin |
3.47 |
% |
|
3.40 |
% |
|
0.07 |
% |
|
2.06 |
% |
Average
earning assets/total average assets |
90.19 |
% |
|
89.46 |
% |
|
0.73 |
% |
|
0.82 |
% |
Average
loans/average deposits |
93.04 |
% |
|
92.06 |
% |
|
0.98 |
% |
|
1.06 |
% |
Average
noninterest deposits/total average deposits |
33.02 |
% |
|
30.87 |
% |
|
2.15 |
% |
|
6.96 |
% |
Allowance
for loan losses/period end loans |
0.76 |
% |
|
0.72 |
% |
|
0.04 |
% |
|
5.56 |
% |
Nonperforming assets to period end assets |
0.33 |
% |
|
0.47 |
% |
|
(0.14 |
)% |
|
(29.79 |
)% |
Period
end equity/period end total assets |
13.41 |
% |
|
13.63 |
% |
|
(0.22 |
)% |
|
(1.61 |
)% |
Efficiency ratio |
65.94 |
% |
|
71.59 |
% |
|
(5.65 |
)% |
|
(7.89 |
)% |
|
|
|
|
|
|
|
|
(1)
Presented on a tax-equivalent basis |
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Selected Financial Highlights
(unaudited) |
(dollars in thousands, except per share
data) |
|
|
December 31, |
|
September 30, |
|
Increase/ |
|
% Increase/ |
Three Months
Ended |
2017 |
|
2017 |
|
(Decrease) |
|
(Decrease) |
|
|
|
|
|
|
|
|
Results of
Operations: |
|
|
|
|
|
|
|
Net
interest income |
$ |
65,664 |
|
|
$ |
65,923 |
|
|
$ |
(259 |
) |
|
(0.39 |
)% |
Noninterest income |
43,477 |
|
|
49,416 |
|
|
(5,939 |
) |
|
(12.02 |
)% |
Total
Revenue |
109,141 |
|
|
115,339 |
|
|
(6,198 |
) |
|
(5.37 |
)% |
Acquisition-related expenses |
526 |
|
|
466 |
|
|
60 |
|
|
12.88 |
% |
Noninterest expenses, excluding acquisition-related expenses |
73,134 |
|
|
73,720 |
|
|
(586 |
) |
|
(0.79 |
)% |
Provision
for loan losses |
869 |
|
|
696 |
|
|
173 |
|
|
24.86 |
% |
Income
before income tax and noncontrolling interest |
34,612 |
|
|
40,457 |
|
|
(5,845 |
) |
|
(14.45 |
)% |
Provision
for income tax expense |
21,325 |
|
|
11,862 |
|
|
9,463 |
|
|
79.78 |
% |
Net
income |
13,287 |
|
|
28,595 |
|
|
(15,308 |
) |
|
(53.53 |
)% |
Net
income attributable to noncontrolling interest |
(954 |
) |
|
(1,445 |
) |
|
491 |
|
|
(33.98 |
)% |
Net
income attributable to TowneBank |
12,333 |
|
|
27,150 |
|
|
(14,817 |
) |
|
(54.57 |
)% |
Net
income available to common shareholders |
12,333 |
|
|
27,150 |
|
|
(14,817 |
) |
|
(54.57 |
)% |
Net
income per common share - basic |
0.20 |
|
|
0.44 |
|
|
(0.24 |
) |
|
(54.55 |
)% |
Net income per common share - diluted |
0.20 |
|
|
0.44 |
|
|
(0.24 |
) |
|
(54.55 |
)% |
Period End
Data: |
|
|
|
|
|
|
|
Total
assets |
$ |
8,522,176 |
|
|
$ |
8,614,794 |
|
|
$ |
(92,618 |
) |
|
(1.08 |
)% |
Total
assets - tangible |
8,213,358 |
|
|
8,304,142 |
|
|
(90,784 |
) |
|
(1.09 |
)% |
Earning
assets |
7,706,747 |
|
|
7,785,167 |
|
|
(78,420 |
) |
|
(1.01 |
)% |
Loans
(net of unearned income) |
5,946,965 |
|
|
5,910,479 |
|
|
36,486 |
|
|
0.62 |
% |
Allowance
for loan losses |
45,131 |
|
|
44,398 |
|
|
733 |
|
|
1.65 |
% |
Goodwill
and other intangibles |
308,819 |
|
|
310,652 |
|
|
(1,833 |
) |
|
(0.59 |
)% |
Nonperforming assets |
28,094 |
|
|
33,891 |
|
|
(5,797 |
) |
|
(17.10 |
)% |
Noninterest bearing deposits |
2,157,338 |
|
|
2,212,047 |
|
|
(54,709 |
) |
|
(2.47 |
)% |
Interest
bearing deposits |
4,290,882 |
|
|
4,336,415 |
|
|
(45,533 |
) |
|
(1.05 |
)% |
Total
deposits |
6,448,220 |
|
|
6,548,462 |
|
|
(100,242 |
) |
|
(1.53 |
)% |
Total
equity |
1,142,505 |
|
|
1,140,852 |
|
|
1,653 |
|
|
0.14 |
% |
Total
equity - tangible |
833,686 |
|
|
830,199 |
|
|
3,487 |
|
|
0.42 |
% |
Common
equity |
1,131,240 |
|
|
1,129,588 |
|
|
1,652 |
|
|
0.15 |
% |
Common
equity - tangible |
822,421 |
|
|
818,936 |
|
|
3,485 |
|
|
0.43 |
% |
Book
value per common share |
18.06 |
|
|
18.04 |
|
|
0.02 |
|
|
0.11 |
% |
Book value per common share - tangible |
13.13 |
|
|
13.08 |
|
|
0.05 |
|
|
0.38 |
% |
Daily Average
Balances: |
|
|
|
|
|
|
|
Total
assets |
$ |
8,579,705 |
|
|
$ |
8,570,019 |
|
|
$ |
9,686 |
|
|
0.11 |
% |
Total
assets - tangible |
8,269,760 |
|
|
8,259,587 |
|
|
10,173 |
|
|
0.12 |
% |
Earning
assets |
7,729,862 |
|
|
7,710,245 |
|
|
19,617 |
|
|
0.25 |
% |
Loans
(net of unearned income), excluding nonaccrual loans |
5,920,302 |
|
|
5,897,169 |
|
|
23,133 |
|
|
0.39 |
% |
Allowance
for loan losses |
44,704 |
|
|
44,198 |
|
|
506 |
|
|
1.14 |
% |
Goodwill
and other intangibles |
309,946 |
|
|
310,432 |
|
|
(486 |
) |
|
(0.16 |
)% |
Noninterest bearing deposits |
2,162,271 |
|
|
2,173,920 |
|
|
(11,649 |
) |
|
(0.54 |
)% |
Interest
bearing deposits |
4,336,175 |
|
|
4,365,820 |
|
|
(29,645 |
) |
|
(0.68 |
)% |
Total
deposits |
6,498,403 |
|
|
6,539,740 |
|
|
(41,337 |
) |
|
(0.63 |
)% |
Total
equity |
1,149,888 |
|
|
1,135,218 |
|
|
14,670 |
|
|
1.29 |
% |
Total
equity - tangible |
839,942 |
|
|
824,787 |
|
|
15,155 |
|
|
1.84 |
% |
Common
equity |
1,138,936 |
|
|
1,124,173 |
|
|
14,763 |
|
|
1.31 |
% |
Common equity - tangible |
828,991 |
|
|
813,741 |
|
|
15,250 |
|
|
1.87 |
% |
Key
Ratios: |
|
|
|
|
|
|
|
Return on
average assets (1) |
0.57 |
% |
|
1.26 |
% |
|
(0.69 |
)% |
|
(54.76 |
)% |
Return on
average assets - tangible (1) |
0.65 |
% |
|
1.37 |
% |
|
(0.72 |
)% |
|
(52.55 |
)% |
Return on
average equity (1) |
4.26 |
% |
|
9.49 |
% |
|
(5.23 |
)% |
|
(55.11 |
)% |
Return on
average equity - tangible (1) |
6.39 |
% |
|
13.67 |
% |
|
(7.28 |
)% |
|
(53.26 |
)% |
Return on
average common equity (1) |
4.30 |
% |
|
9.58 |
% |
|
(5.28 |
)% |
|
(55.11 |
)% |
Return on
average common equity - tangible (1) |
6.47 |
% |
|
13.86 |
% |
|
(7.39 |
)% |
|
(53.32 |
)% |
Net
interest margin-fully tax equivalent (2) |
3.41 |
% |
|
3.43 |
% |
|
(0.02 |
)% |
|
(0.58 |
)% |
Net
interest margin |
3.37 |
% |
|
3.39 |
% |
|
(0.02 |
)% |
|
(0.59 |
)% |
Average
earning assets/total average assets |
90.09 |
% |
|
89.97 |
% |
|
0.12 |
% |
|
0.13 |
% |
Average
loans/average deposits |
91.10 |
% |
|
90.17 |
% |
|
0.93 |
% |
|
1.03 |
% |
Average
noninterest deposits/total average deposits |
33.27 |
% |
|
33.24 |
% |
|
0.03 |
% |
|
0.09 |
% |
Allowance
for loan losses/period end loans |
0.76 |
% |
|
0.75 |
% |
|
0.01 |
% |
|
1.33 |
% |
Nonperforming assets to period end assets |
0.33 |
% |
|
0.39 |
% |
|
(0.06 |
)% |
|
(15.38 |
)% |
Period
end equity/period end total assets |
13.41 |
% |
|
13.24 |
% |
|
0.17 |
% |
|
1.28 |
% |
Efficiency ratio |
67.49 |
% |
|
64.32 |
% |
|
3.17 |
% |
|
4.93 |
% |
|
|
|
|
|
|
|
|
(1)
Annualized |
(2)
Presented on a tax-equivalent basis |
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Average Balances, Yields and Rate Paid
(unaudited) |
(dollars in thousands) |
|
|
Three Months Ended |
|
Three Months Ended |
|
Three Months Ended |
|
December 31, 2017 |
|
September 30, 2017 |
|
December 31, 2016 |
|
|
|
Interest |
|
Average |
|
|
|
Interest |
|
Average |
|
|
|
Interest |
|
Average |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans (net of unearned
income and deferred costs), excluding nonaccrual
loans |
$ |
5,920,302 |
|
|
$ |
70,044 |
|
|
4.69 |
% |
|
$ |
5,897,169 |
|
|
$ |
69,679 |
|
|
4.69 |
% |
|
$ |
5,705,832 |
|
|
$ |
66,061 |
|
|
4.61 |
% |
Taxable investment
securities |
657,297 |
|
|
3,237 |
|
|
1.97 |
% |
|
582,747 |
|
|
2,717 |
|
|
1.86 |
% |
|
666,936 |
|
|
2,762 |
|
|
1.66 |
% |
Tax-exempt investment
securities |
46,825 |
|
|
361 |
|
|
3.09 |
% |
|
47,087 |
|
|
360 |
|
|
3.06 |
% |
|
52,199 |
|
|
390 |
|
|
2.99 |
% |
Interest-bearing
deposits |
812,741 |
|
|
2,662 |
|
|
1.30 |
% |
|
870,480 |
|
|
2,745 |
|
|
1.25 |
% |
|
352,418 |
|
|
487 |
|
|
0.55 |
% |
Loans held for
sale |
292,697 |
|
|
2,874 |
|
|
3.93 |
% |
|
312,762 |
|
|
3,081 |
|
|
3.94 |
% |
|
348,357 |
|
|
3,028 |
|
|
3.48 |
% |
Total earning
assets |
7,729,862 |
|
|
79,178 |
|
|
4.06 |
% |
|
7,710,245 |
|
|
78,582 |
|
|
4.04 |
% |
|
7,125,742 |
|
|
72,728 |
|
|
4.06 |
% |
Less:
allowance for loan losses |
(44,704 |
) |
|
|
|
|
|
(44,198 |
) |
|
|
|
|
|
(41,188 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total nonearning
assets |
894,547 |
|
|
|
|
|
|
903,972 |
|
|
|
|
|
|
880,884 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets |
$ |
8,579,705 |
|
|
|
|
|
|
$ |
8,570,019 |
|
|
|
|
|
|
$ |
7,965,438 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
and money market |
$ |
2,247,745 |
|
|
$ |
2,091 |
|
|
0.37 |
% |
|
$ |
2,284,995 |
|
|
$ |
2,107 |
|
|
0.37 |
% |
|
$ |
2,230,198 |
|
|
$ |
1,742 |
|
|
0.31 |
% |
Savings |
320,218 |
|
|
870 |
|
|
1.08 |
% |
|
320,891 |
|
|
862 |
|
|
1.07 |
% |
|
316,211 |
|
|
728 |
|
|
0.92 |
% |
Certificates of deposit |
1,768,212 |
|
|
5,141 |
|
|
1.15 |
% |
|
1,759,934 |
|
|
4,841 |
|
|
1.09 |
% |
|
1,591,397 |
|
|
3,458 |
|
|
0.86 |
% |
Total interest-bearing
deposits |
4,336,175 |
|
|
8,102 |
|
|
0.74 |
% |
|
4,365,820 |
|
|
7,810 |
|
|
0.71 |
% |
|
4,137,806 |
|
|
5,928 |
|
|
0.57 |
% |
Borrowings |
554,039 |
|
|
1,819 |
|
|
1.28 |
% |
|
554,147 |
|
|
1,770 |
|
|
1.25 |
% |
|
628,272 |
|
|
3,739 |
|
|
2.33 |
% |
Subordinated
debentures |
247,152 |
|
|
2,880 |
|
|
4.66 |
% |
|
204,146 |
|
|
2,368 |
|
|
4.64 |
% |
|
|
|
|
|
|
Total interest-bearing
liabilities |
5,137,366 |
|
|
12,801 |
|
|
0.99 |
% |
|
5,124,113 |
|
|
11,948 |
|
|
0.93 |
% |
|
4,766,078 |
|
|
9,667 |
|
|
0.81 |
% |
Demand deposits |
2,162,271 |
|
|
|
|
|
|
2,173,920 |
|
|
|
|
|
|
1,961,902 |
|
|
|
|
|
Other
noninterest-bearing liabilities |
130,180 |
|
|
|
|
|
|
136,768 |
|
|
|
|
|
|
150,076 |
|
|
|
|
|
Total
liabilities |
7,429,817 |
|
|
|
|
|
|
7,434,801 |
|
|
|
|
|
|
6,878,056 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders’
equity |
1,149,888 |
|
|
|
|
|
|
1,135,218 |
|
|
|
|
|
|
1,087,382 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and equity |
$ |
8,579,705 |
|
|
|
|
|
|
$ |
8,570,019 |
|
|
|
|
|
|
$ |
7,965,438 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
(tax-equivalent basis) |
|
|
$ |
66,377 |
|
|
|
|
|
|
$ |
66,634 |
|
|
|
|
|
|
$ |
63,061 |
|
|
|
Reconcilement of Non-GAAP Financial Measures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-equivalent basis adjustment |
|
|
(713 |
) |
|
|
|
|
|
(711 |
) |
|
|
|
|
|
(910 |
) |
|
|
Net interest income
(GAAP) |
|
|
$ |
65,664 |
|
|
|
|
|
|
$ |
65,923 |
|
|
|
|
|
|
$ |
62,151 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread
(1) |
|
|
|
|
3.07 |
% |
|
|
|
|
|
3.11 |
% |
|
|
|
|
|
3.25 |
% |
Interest expense as a
percent of average earning assets |
|
|
|
|
|
|
0.66 |
% |
|
|
|
|
|
0.61 |
% |
|
|
|
|
|
0.54 |
% |
Net interest margin
(tax equivalent basis) (2) |
|
|
|
|
|
|
3.41 |
% |
|
|
|
|
|
3.43 |
% |
|
|
|
|
|
3.52 |
% |
Total cost of
deposits |
|
|
|
|
0.49 |
% |
|
|
|
|
|
0.47 |
% |
|
|
|
|
|
0.39 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Interest spread is the average yield earned on earning assets less
the average rate paid on interest-bearing liabilities. Fully
tax equivalent. |
(2) Net
interest margin is net interest income expressed as a percentage of
average earning assets. Fully tax equivalent. |
|
|
TOWNEBANK |
Average Balances, Yields and Rate Paid
(unaudited) |
(dollars in thousands) |
|
|
Year Ended December 31, |
|
2017 |
|
2016 |
|
2015 |
|
|
|
Interest |
|
Average |
|
|
|
Interest |
|
Average |
|
|
|
Interest |
|
Average |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans (net of unearned
income and deferred costs), excluding nonaccrual loans |
$ |
5,901,797 |
|
|
$ |
276,869 |
|
|
4.69 |
% |
|
$ |
5,129,990 |
|
|
$ |
234,318 |
|
|
4.57 |
% |
|
$ |
4,239,887 |
|
|
$ |
196,868 |
|
|
4.64 |
% |
Taxable investment
securities |
616,141 |
|
|
11,597 |
|
|
1.88 |
% |
|
695,082 |
|
|
11,254 |
|
|
1.62 |
% |
|
786,737 |
|
|
11,849 |
|
|
1.51 |
% |
Tax-exempt investment
securities |
48,228 |
|
|
1,467 |
|
|
3.04 |
% |
|
52,689 |
|
|
1,601 |
|
|
3.04 |
% |
|
61,489 |
|
|
1,952 |
|
|
3.17 |
% |
Interest-bearing
deposits |
680,026 |
|
|
7,481 |
|
|
1.10 |
% |
|
300,130 |
|
|
1,145 |
|
|
0.38 |
% |
|
188,546 |
|
|
499 |
|
|
0.26 |
% |
Mortgage loans held for
sale |
271,281 |
|
|
10,561 |
|
|
3.89 |
% |
|
264,494 |
|
|
9,152 |
|
|
3.46 |
% |
|
104,222 |
|
|
3,836 |
|
|
3.68 |
% |
Total earning
assets |
7,517,473 |
|
|
307,975 |
|
|
4.10 |
% |
|
6,442,385 |
|
|
257,470 |
|
|
4.00 |
% |
|
5,380,881 |
|
|
215,004 |
|
|
4.00 |
% |
Less:
allowance for loan losses |
(43,760 |
) |
|
|
|
|
|
(39,547 |
) |
|
|
|
|
|
(37,194 |
) |
|
|
|
|
Total nonearning
assets |
861,286 |
|
|
|
|
|
|
802,398 |
|
|
|
|
|
|
695,731 |
|
|
|
|
|
Total
assets |
$ |
8,334,999 |
|
|
|
|
|
|
$ |
7,205,236 |
|
|
|
|
|
|
$ |
6,039,418 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
and money market |
$ |
2,260,378 |
|
|
$ |
8,020 |
|
|
0.35 |
% |
|
$ |
2,012,061 |
|
|
$ |
6,043 |
|
|
0.30 |
% |
|
$ |
1,689,185 |
|
|
$ |
4,721 |
|
|
0.28 |
% |
Savings |
319,940 |
|
|
3,305 |
|
|
1.03 |
% |
|
309,049 |
|
|
2,859 |
|
|
0.93 |
% |
|
300,620 |
|
|
2,755 |
|
|
0.92 |
% |
Certificates of deposit |
1,668,253 |
|
|
17,467 |
|
|
1.05 |
% |
|
1,530,990 |
|
|
13,414 |
|
|
0.88 |
% |
|
1,334,728 |
|
|
11,390 |
|
|
0.85 |
% |
Total interest-bearing
deposits |
4,248,571 |
|
|
28,792 |
|
|
0.68 |
% |
|
3,852,100 |
|
|
22,316 |
|
|
0.58 |
% |
|
3,324,533 |
|
|
18,866 |
|
|
0.57 |
% |
FHLB advances and
repurchase agreements |
617,720 |
|
|
9,942 |
|
|
1.61 |
% |
|
523,366 |
|
|
13,424 |
|
|
2.56 |
% |
|
463,153 |
|
|
13,565 |
|
|
2.93 |
% |
Subordinated capital
debentures |
113,752 |
|
|
5,249 |
|
|
4.61 |
% |
|
— |
|
|
— |
|
|
— |
% |
|
— |
|
|
— |
|
|
— |
% |
Total interest-bearing
liabilities |
4,980,043 |
|
|
43,983 |
|
|
0.88 |
% |
|
4,375,466 |
|
|
35,740 |
|
|
0.82 |
% |
|
3,787,686 |
|
|
32,431 |
|
|
0.86 |
% |
Noninterest-bearing
liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits |
2,094,753 |
|
|
|
|
|
|
1,720,093 |
|
|
|
|
|
|
1,343,360 |
|
|
|
|
|
Other
noninterest-bearing liabilities |
136,615 |
|
|
|
|
|
|
145,902 |
|
|
|
|
|
|
103,628 |
|
|
|
|
|
Total
liabilities |
7,211,411 |
|
|
|
|
|
|
6,241,461 |
|
|
|
|
|
|
5,234,674 |
|
|
|
|
|
Shareholders'
equity |
1,123,588 |
|
|
|
|
|
|
963,775 |
|
|
|
|
|
|
804,744 |
|
|
|
|
|
Total
liabilities and equity |
$ |
8,334,999 |
|
|
|
|
|
|
$ |
7,205,236 |
|
|
|
|
|
|
$ |
6,039,418 |
|
|
|
|
|
Net
interest income (tax-equivalent basis) |
|
$ |
263,992 |
|
|
|
|
|
|
$ |
221,730 |
|
|
|
|
|
|
$ |
182,573 |
|
|
|
Reconcilement of Non-GAAP Financial Measures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-equivalent basis adjustment |
|
(2,871 |
) |
|
|
|
|
|
(2,854 |
) |
|
|
|
|
|
(2,131 |
) |
|
|
Net
interest income (GAAP) |
|
$ |
261,121 |
|
|
|
|
|
|
$ |
218,876 |
|
|
|
|
|
|
$ |
180,442 |
|
|
|
Interest
rate spread (1) |
|
|
|
3.22 |
% |
|
|
|
|
|
3.17 |
% |
|
|
|
|
|
3.14 |
% |
Interest
expense as a percent of average earning assets |
|
|
|
0.59 |
% |
|
|
|
|
|
0.55 |
% |
|
|
|
|
|
0.60 |
% |
Net
interest margin (tax-equivalent basis) (2) |
|
|
|
3.51 |
% |
|
|
|
|
|
3.44 |
% |
|
|
|
|
|
3.39 |
% |
Total cost
of deposits |
|
|
|
0.45 |
% |
|
|
|
|
|
0.40 |
% |
|
|
|
|
|
0.40 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Interest spread is the average yield earned on earning assets less
the average rate paid on interest-bearing liabilities. Fully
tax equivalent. |
(2) Net
interest margin is net interest income expressed as a percentage of
average earning assets. Fully tax equivalent. |
|
|
TOWNEBANK |
Consolidated Balance Sheets |
(dollars in thousands, except share
data) |
|
|
|
|
2017 |
|
2016 |
|
(unaudited) |
|
(audited) |
ASSETS |
|
|
|
Cash and due from
banks |
$ |
500,408 |
|
|
$ |
130,967 |
|
Interest-bearing
deposits in financial institutions |
4,471 |
|
|
5,581 |
|
Total Cash and Cash Equivalents |
504,879 |
|
|
136,548 |
|
Securities available
for sale, at fair value |
867,654 |
|
|
812,974 |
|
Securities held to
maturity, at amortized cost |
61,304 |
|
|
66,490 |
|
Federal Home Loan Bank
stock, at amortized cost |
29,595 |
|
|
35,937 |
|
Total Securities |
958,553 |
|
|
915,401 |
|
Mortgage loans held for
sale |
313,256 |
|
|
314,046 |
|
Loans, net of unearned
income and deferred costs: |
5,946,965 |
|
|
5,807,221 |
|
Less:
allowance for loan losses |
(45,131 |
) |
|
(42,001 |
) |
Net Loans |
5,901,834 |
|
|
5,765,220 |
|
Premises and equipment,
net |
194,900 |
|
|
198,568 |
|
Goodwill |
270,250 |
|
|
264,910 |
|
Other intangible
assets, net |
38,568 |
|
|
37,856 |
|
Bank-owned life
insurance policies |
195,775 |
|
|
189,499 |
|
Other assets |
144,161 |
|
|
151,867 |
|
TOTAL ASSETS |
$ |
8,522,176 |
|
|
$ |
7,973,915 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Deposits: |
|
|
|
Noninterest-bearing demand |
$ |
2,157,338 |
|
|
$ |
1,947,312 |
|
Interest-bearing: |
|
|
|
Demand
and money market accounts |
2,225,211 |
|
|
2,263,894 |
|
Savings |
315,889 |
|
|
319,611 |
|
Certificates of deposit |
1,749,782 |
|
|
1,504,380 |
|
Total Deposits |
6,448,220 |
|
|
6,035,197 |
|
Advances from the
Federal Home Loan Bank |
526,923 |
|
|
687,511 |
|
Subordinated debt,
net |
247,196 |
|
|
— |
|
Repurchase agreements
and other borrowings |
24,094 |
|
|
32,540 |
|
Total Borrowings |
798,213 |
|
|
720,051 |
|
Other liabilities |
133,238 |
|
|
132,109 |
|
TOTAL LIABILITIES |
7,379,671 |
|
|
6,887,357 |
|
Preferred stock |
|
|
|
Authorized and unissued shares - 2,000,000 |
— |
|
|
— |
|
Common stock, $1.667
par value |
|
|
|
Authorized shares - 90,000,000 |
|
|
|
Issued
and outstanding shares 62,629,001 in 2017 and 64,492,168 in
2016 |
104,403 |
|
|
104,174 |
|
Capital surplus |
749,801 |
|
|
745,411 |
|
Retained earnings |
282,729 |
|
|
229,503 |
|
Common stock issued to
deferred compensation trust, at cost 729,919 shares in 2017 and
692,431 shares in 2016 |
(12,524 |
) |
|
(11,168 |
) |
Deferred compensation
trust |
12,524 |
|
|
11,168 |
|
Accumulated other
comprehensive loss |
(5,693 |
) |
|
(3,986 |
) |
TOTAL SHAREHOLDERS’ EQUITY |
1,131,240 |
|
|
1,075,102 |
|
Noncontrolling
interest |
11,265 |
|
|
11,456 |
|
TOTAL EQUITY |
1,142,505 |
|
|
1,086,558 |
|
TOTAL LIABILITIES AND EQUITY |
$ |
8,522,176 |
|
|
$ |
7,973,915 |
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Consolidated Statements of
Income |
(dollars in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Twelve months ended |
|
December 31, |
|
December 31, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(audited) |
INTEREST
INCOME: |
|
|
|
|
|
|
|
Loans,
including fees |
$ |
69,332 |
|
|
$ |
65,151 |
|
|
$ |
273,999 |
|
|
$ |
231,464 |
|
Investment securities |
3,598 |
|
|
3,152 |
|
|
13,064 |
|
|
12,855 |
|
Interest-bearing deposits in financial institutions and federal
funds sold |
2,661 |
|
|
487 |
|
|
7,480 |
|
|
1,145 |
|
Mortgage
loans held for sale |
2,874 |
|
|
3,028 |
|
|
10,561 |
|
|
9,152 |
|
Total interest income |
78,465 |
|
|
71,818 |
|
|
305,104 |
|
|
254,616 |
|
INTEREST
EXPENSE: |
|
|
|
|
|
|
|
Deposits |
8,102 |
|
|
5,928 |
|
|
28,792 |
|
|
22,316 |
|
Advances
from the Federal Home Loan Bank |
1,791 |
|
|
3,715 |
|
|
9,837 |
|
|
13,320 |
|
Subordinated debt |
2,880 |
|
|
— |
|
|
5,249 |
|
|
— |
|
Repurchase agreements and other borrowings |
28 |
|
|
24 |
|
|
105 |
|
|
104 |
|
Total interest expense |
12,801 |
|
|
9,667 |
|
|
43,983 |
|
|
35,740 |
|
Net interest
income |
65,664 |
|
|
62,151 |
|
|
261,121 |
|
|
218,876 |
|
|
|
|
|
|
|
|
|
PROVISION FOR
LOAN LOSSES |
869 |
|
|
1,831 |
|
|
5,426 |
|
|
5,357 |
|
Net interest income after provision for loan
losses |
64,795 |
|
|
60,320 |
|
|
255,695 |
|
|
213,519 |
|
NONINTEREST
INCOME: |
|
|
|
|
|
|
|
Residential mortgage banking income, net |
17,537 |
|
|
18,096 |
|
|
75,851 |
|
|
58,792 |
|
Insurance
commissions and other title fees and income, net |
12,115 |
|
|
9,823 |
|
|
51,933 |
|
|
46,741 |
|
Real
estate brokerage and property management income, net |
4,823 |
|
|
2,925 |
|
|
27,487 |
|
|
20,515 |
|
Service
charges on deposit accounts |
2,809 |
|
|
2,535 |
|
|
10,594 |
|
|
9,547 |
|
Credit
card merchant fees, net |
1,204 |
|
|
1,135 |
|
|
5,008 |
|
|
4,508 |
|
Bank
owned life insurance |
1,941 |
|
|
2,377 |
|
|
6,262 |
|
|
5,992 |
|
Other
income |
3,048 |
|
|
2,621 |
|
|
10,987 |
|
|
9,121 |
|
Gain
(loss) on investment securities |
— |
|
|
6 |
|
|
(1 |
) |
|
6 |
|
Total noninterest income |
43,477 |
|
|
39,518 |
|
|
188,121 |
|
|
155,222 |
|
NONINTEREST
EXPENSE: |
|
|
|
|
|
|
|
Salaries
and employee benefits |
42,480 |
|
|
43,071 |
|
|
170,989 |
|
|
143,847 |
|
Occupancy |
6,878 |
|
|
6,885 |
|
|
26,855 |
|
|
23,717 |
|
Furniture
and equipment |
3,456 |
|
|
3,378 |
|
|
14,072 |
|
|
11,315 |
|
Other
expenses |
20,846 |
|
|
19,500 |
|
|
84,298 |
|
|
88,949 |
|
Total noninterest expense |
73,660 |
|
|
72,834 |
|
|
296,214 |
|
|
267,828 |
|
Income before
income tax expense & noncontrolling interest |
34,612 |
|
|
27,004 |
|
|
147,602 |
|
|
100,913 |
|
Provision for
income tax expense |
21,325 |
|
|
7,160 |
|
|
54,813 |
|
|
28,698 |
|
Net
income |
$ |
13,287 |
|
|
$ |
19,844 |
|
|
$ |
92,789 |
|
|
$ |
72,215 |
|
Net income
attributable to noncontrolling interest |
(954 |
) |
|
(848 |
) |
|
(5,126 |
) |
|
(4,965 |
) |
Net income
attributable to TowneBank |
$ |
12,333 |
|
|
$ |
18,996 |
|
|
$ |
87,663 |
|
|
$ |
67,250 |
|
|
|
|
|
|
|
|
|
Net income
available to common shareholders |
$ |
12,333 |
|
|
$ |
18,996 |
|
|
$ |
87,663 |
|
|
$ |
67,250 |
|
Per common
share information |
|
|
|
|
|
|
|
Basic
earnings |
$ |
0.20 |
|
|
$ |
0.31 |
|
|
$ |
1.41 |
|
|
$ |
1.18 |
|
Diluted
earnings |
$ |
0.20 |
|
|
$ |
0.31 |
|
|
$ |
1.41 |
|
|
$ |
1.18 |
|
Cash
dividends declared |
$ |
0.14 |
|
|
$ |
0.13 |
|
|
$ |
0.55 |
|
|
$ |
0.51 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Consolidated Statements of Comprehensive
Income |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Twelve months ended |
|
December 31, |
|
December 31, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(audited) |
|
|
|
|
|
|
|
|
Net
income |
$ |
13,287 |
|
|
$ |
19,844 |
|
|
$ |
92,789 |
|
|
$ |
72,215 |
|
|
|
|
|
|
|
|
|
Other
comprehensive income (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized losses on securities |
|
|
|
|
|
|
|
Unrealized holding losses arising during the period |
(4,072 |
) |
|
(8,294 |
) |
|
(1,644 |
) |
|
(2,000 |
) |
Deferred
tax benefit |
1,426 |
|
|
2,903 |
|
|
575 |
|
|
700 |
|
Realized
gains (losses) reclassified into earnings |
— |
|
|
(6 |
) |
|
1 |
|
|
(6 |
) |
Deferred
tax benefit |
— |
|
|
2 |
|
|
— |
|
|
2 |
|
Net
unrealized losses |
(2,646 |
) |
|
(5,395 |
) |
|
(1,068 |
) |
|
(1,304 |
) |
|
|
|
|
|
|
|
|
Pension and postretirement benefit plans |
|
|
|
|
|
|
|
Prior
service costs |
(1,027 |
) |
|
— |
|
|
(1,027 |
) |
|
— |
|
Deferred
tax benefit |
359 |
|
|
— |
|
|
359 |
|
|
— |
|
Actuarial
gain (losses) |
(148 |
) |
|
— |
|
|
(400 |
) |
|
323 |
|
Deferred
tax benefit (expense) |
52 |
|
|
— |
|
|
142 |
|
|
(113 |
) |
Amortization of prior service costs |
155 |
|
|
110 |
|
|
288 |
|
|
151 |
|
Deferred
tax expense |
(54 |
) |
|
(39 |
) |
|
(100 |
) |
|
(53 |
) |
Amortization of net actuarial (gain) loss |
39 |
|
|
(2 |
) |
|
156 |
|
|
7 |
|
Deferred
tax benefit (expense) |
(14 |
) |
|
1 |
|
|
(56 |
) |
|
(3 |
) |
Change in
retirement plans, net of tax |
(638 |
) |
|
70 |
|
|
(638 |
) |
|
312 |
|
|
|
|
|
|
|
|
|
Other
comprehensive loss, net of tax |
(3,284 |
) |
|
(5,325 |
) |
|
(1,706 |
) |
|
(992 |
) |
|
|
|
|
|
|
|
|
Comprehensive
income |
$ |
10,003 |
|
|
$ |
14,519 |
|
|
$ |
91,083 |
|
|
$ |
71,223 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Consolidated Balance Sheets - Five Quarter
Trend |
(dollars in thousands, except share
data) |
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
2017 |
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(audited) |
ASSETS |
|
|
|
|
|
|
|
|
|
Cash and due from
banks |
$ |
500,408 |
|
|
$ |
647,728 |
|
|
$ |
468,455 |
|
|
$ |
420,192 |
|
|
$ |
130,967 |
|
Interest-bearing
deposits in financial institutions |
4,471 |
|
|
5,055 |
|
|
5,071 |
|
|
5,335 |
|
|
5,581 |
|
Total Cash and Cash Equivalents |
504,879 |
|
|
652,783 |
|
|
473,526 |
|
|
425,527 |
|
|
136,548 |
|
Securities available
for sale, at fair value |
867,654 |
|
|
831,483 |
|
|
700,354 |
|
|
720,667 |
|
|
812,974 |
|
Securities held to
maturity, at amortized cost |
61,304 |
|
|
62,487 |
|
|
63,937 |
|
|
65,117 |
|
|
66,490 |
|
Federal Home Loan Bank
stock, at amortized cost |
29,595 |
|
|
29,586 |
|
|
29,586 |
|
|
36,402 |
|
|
35,937 |
|
Total Securities |
958,553 |
|
|
923,556 |
|
|
793,877 |
|
|
822,186 |
|
|
915,401 |
|
Mortgage loans held for
sale |
313,256 |
|
|
318,595 |
|
|
388,523 |
|
|
214,047 |
|
|
314,046 |
|
Loans, net of unearned
income and deferred costs: |
5,946,965 |
|
|
5,910,479 |
|
|
5,949,061 |
|
|
5,913,080 |
|
|
5,807,221 |
|
Less:
allowance for loan losses |
(45,131 |
) |
|
(44,398 |
) |
|
(44,131 |
) |
|
(43,195 |
) |
|
(42,001 |
) |
Net Loans |
5,901,834 |
|
|
5,866,081 |
|
|
5,904,930 |
|
|
5,869,885 |
|
|
5,765,220 |
|
Premises and equipment,
net |
194,900 |
|
|
196,975 |
|
|
199,926 |
|
|
198,664 |
|
|
198,568 |
|
Goodwill |
270,250 |
|
|
270,901 |
|
|
268,246 |
|
|
264,910 |
|
|
264,910 |
|
Other intangible
assets, net |
38,568 |
|
|
39,751 |
|
|
40,066 |
|
|
37,052 |
|
|
37,856 |
|
Bank-owned life
insurance policies |
195,775 |
|
|
193,823 |
|
|
192,339 |
|
|
190,917 |
|
|
189,499 |
|
Other assets |
144,161 |
|
|
152,329 |
|
|
165,609 |
|
|
151,598 |
|
|
151,867 |
|
TOTAL
ASSETS |
$ |
8,522,176 |
|
|
$ |
8,614,794 |
|
|
$ |
8,427,042 |
|
|
$ |
8,174,786 |
|
|
$ |
7,973,915 |
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
Noninterest-bearing demand |
$ |
2,157,338 |
|
|
$ |
2,212,047 |
|
|
$ |
2,219,406 |
|
|
$ |
2,052,598 |
|
|
$ |
1,947,312 |
|
Interest-bearing: |
|
|
|
|
|
|
|
|
|
Demand
and money market accounts |
2,225,211 |
|
|
2,253,746 |
|
|
2,292,978 |
|
|
2,270,025 |
|
|
2,263,894 |
|
Savings |
315,889 |
|
|
320,028 |
|
|
318,714 |
|
|
320,104 |
|
|
319,611 |
|
Certificates of deposit |
1,749,782 |
|
|
1,762,641 |
|
|
1,764,671 |
|
|
1,548,045 |
|
|
1,504,380 |
|
Total Deposits |
6,448,220 |
|
|
6,548,462 |
|
|
6,595,769 |
|
|
6,190,772 |
|
|
6,035,197 |
|
Advances from the
Federal Home Loan Bank |
526,923 |
|
|
527,072 |
|
|
527,219 |
|
|
687,366 |
|
|
687,511 |
|
Subordinated debt,
net |
247,196 |
|
|
247,128 |
|
|
— |
|
|
— |
|
|
— |
|
Repurchase agreements
and other borrowings |
24,094 |
|
|
23,195 |
|
|
28,571 |
|
|
35,318 |
|
|
32,540 |
|
Total Borrowings |
798,213 |
|
|
797,395 |
|
|
555,790 |
|
|
722,684 |
|
|
720,051 |
|
Other liabilities |
133,238 |
|
|
128,086 |
|
|
152,485 |
|
|
160,085 |
|
|
132,109 |
|
TOTAL
LIABILITIES |
7,379,671 |
|
|
7,473,943 |
|
|
7,304,044 |
|
|
7,073,541 |
|
|
6,887,357 |
|
Preferred stock |
|
|
|
|
|
|
|
|
|
Authorized shares - 2,000,000 |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
Common stock, $1.667
par value |
104,403 |
|
|
104,387 |
|
|
104,386 |
|
|
104,307 |
|
|
104,174 |
|
Capital surplus |
749,801 |
|
|
748,444 |
|
|
747,867 |
|
|
746,289 |
|
|
745,411 |
|
Retained earnings |
282,729 |
|
|
279,165 |
|
|
260,783 |
|
|
243,337 |
|
|
229,503 |
|
Common stock issued to
deferred compensation trust, at cost |
(12,524 |
) |
|
(12,304 |
) |
|
(11,492 |
) |
|
(11,294 |
) |
|
(11,168 |
) |
Deferred compensation
trust |
12,524 |
|
|
12,304 |
|
|
11,492 |
|
|
11,294 |
|
|
11,168 |
|
Accumulated other
comprehensive income (loss) |
(5,693 |
) |
|
(2,408 |
) |
|
(2,355 |
) |
|
(4,173 |
) |
|
(3,986 |
) |
TOTAL
SHAREHOLDERS’ EQUITY |
1,131,240 |
|
|
1,129,588 |
|
|
1,110,681 |
|
|
1,089,760 |
|
|
1,075,102 |
|
Noncontrolling
interest |
11,265 |
|
|
11,263 |
|
|
12,317 |
|
|
11,485 |
|
|
11,456 |
|
TOTAL
EQUITY |
1,142,505 |
|
|
1,140,851 |
|
|
1,122,998 |
|
|
1,101,245 |
|
|
1,086,558 |
|
TOTAL
LIABILITIES AND EQUITY |
$ |
8,522,176 |
|
|
$ |
8,614,794 |
|
|
$ |
8,427,042 |
|
|
$ |
8,174,786 |
|
|
$ |
7,973,915 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Consolidated Statements of Income - Five
Quarter Trend (unaudited) |
(dollars in thousands, except per share
data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
2017 |
|
2017 |
|
2017 |
|
2017 |
|
2016 |
INTEREST
INCOME: |
|
|
|
|
|
|
|
|
|
Loans,
including fees |
$ |
69,332 |
|
|
$ |
68,969 |
|
|
$ |
71,443 |
|
|
$ |
64,255 |
|
|
$ |
65,151 |
|
Investment securities |
3,598 |
|
|
3,076 |
|
|
3,171 |
|
|
3,218 |
|
|
3,152 |
|
Interest-bearing deposits in financial institutions
and federal funds sold |
2,661 |
|
|
2,745 |
|
|
1,188 |
|
|
887 |
|
|
487 |
|
Mortgage
loans held for sale |
2,874 |
|
|
3,081 |
|
|
2,879 |
|
|
1,727 |
|
|
3,028 |
|
Total Interest Income |
78,465 |
|
|
77,871 |
|
|
78,681 |
|
|
70,087 |
|
|
71,818 |
|
INTEREST
EXPENSE: |
|
|
|
|
|
|
|
|
|
Deposits |
8,102 |
|
|
7,810 |
|
|
6,877 |
|
|
6,003 |
|
|
5,928 |
|
Advances
from the Federal Home Loan Bank |
1,791 |
|
|
1,750 |
|
|
2,521 |
|
|
3,772 |
|
|
3,715 |
|
Subordinated debt |
2,880 |
|
|
2,368 |
|
|
— |
|
|
— |
|
|
— |
|
Repurchase agreements and other borrowings |
28 |
|
|
20 |
|
|
30 |
|
|
31 |
|
|
24 |
|
Total Interest Expense |
12,801 |
|
|
11,948 |
|
|
9,428 |
|
|
9,806 |
|
|
9,667 |
|
Net Interest
Income |
65,664 |
|
|
65,923 |
|
|
69,253 |
|
|
60,281 |
|
|
62,151 |
|
|
|
|
|
|
|
|
|
|
|
PROVISION FOR
LOAN LOSSES |
869 |
|
|
696 |
|
|
1,320 |
|
|
2,541 |
|
|
1,831 |
|
Net Interest Income after Provision for Loan
Losses |
64,795 |
|
|
65,227 |
|
|
67,933 |
|
|
57,740 |
|
|
60,320 |
|
NONINTEREST
INCOME: |
|
|
|
|
|
|
|
|
|
Residential mortgage banking income, net |
17,537 |
|
|
19,087 |
|
|
21,594 |
|
|
17,632 |
|
|
18,096 |
|
Insurance
commissions and other title fees and income, net |
12,115 |
|
|
12,116 |
|
|
12,902 |
|
|
14,800 |
|
|
9,823 |
|
Real
estate brokerage and property management income, net |
4,823 |
|
|
10,042 |
|
|
7,629 |
|
|
4,993 |
|
|
2,925 |
|
Service
charges on deposit accounts |
2,809 |
|
|
2,670 |
|
|
2,644 |
|
|
2,472 |
|
|
2,535 |
|
Credit
card merchant fees, net |
1,204 |
|
|
1,388 |
|
|
1,298 |
|
|
1,118 |
|
|
1,135 |
|
Bank
owned life insurance |
1,941 |
|
|
1,425 |
|
|
1,421 |
|
|
1,474 |
|
|
2,377 |
|
Other
income |
3,048 |
|
|
2,688 |
|
|
2,856 |
|
|
2,397 |
|
|
2,621 |
|
Net gain
(loss) on investment securities |
— |
|
|
— |
|
|
(1 |
) |
|
— |
|
|
6 |
|
Total Noninterest Income |
43,477 |
|
|
49,416 |
|
|
50,343 |
|
|
44,886 |
|
|
39,518 |
|
NONINTEREST
EXPENSE: |
|
|
|
|
|
|
|
|
|
Salaries
and employee benefits |
42,480 |
|
|
43,467 |
|
|
44,834 |
|
|
40,208 |
|
|
43,071 |
|
Occupancy
expense |
6,878 |
|
|
6,635 |
|
|
6,658 |
|
|
6,684 |
|
|
6,885 |
|
Furniture
and equipment |
3,456 |
|
|
3,710 |
|
|
3,563 |
|
|
3,343 |
|
|
3,378 |
|
Other
expenses |
20,846 |
|
|
20,374 |
|
|
23,064 |
|
|
20,013 |
|
|
19,500 |
|
Total Noninterest Expense |
73,660 |
|
|
74,186 |
|
|
78,119 |
|
|
70,248 |
|
|
72,834 |
|
Income before
income tax expense and noncontrolling interest |
34,612 |
|
|
40,457 |
|
|
40,157 |
|
|
32,378 |
|
|
27,004 |
|
Provision for
income tax expense |
21,325 |
|
|
11,862 |
|
|
12,240 |
|
|
9,386 |
|
|
7,160 |
|
Net
income |
13,287 |
|
|
28,595 |
|
|
27,917 |
|
|
22,992 |
|
|
19,844 |
|
Net income
attributable to noncontrolling interest |
(954 |
) |
|
(1,445 |
) |
|
(1,704 |
) |
|
(1,024 |
) |
|
(848 |
) |
Net income
attributable to TowneBank |
$ |
12,333 |
|
|
$ |
27,150 |
|
|
$ |
26,213 |
|
|
$ |
21,968 |
|
|
$ |
18,996 |
|
Net income
available to common shareholders |
$ |
12,333 |
|
|
$ |
27,150 |
|
|
$ |
26,213 |
|
|
$ |
21,968 |
|
|
$ |
18,996 |
|
Per common
share information |
|
|
|
|
|
|
|
|
|
Basic
earnings |
$ |
0.20 |
|
|
$ |
0.44 |
|
|
$ |
0.42 |
|
|
$ |
0.35 |
|
|
$ |
0.31 |
|
Diluted
earnings |
$ |
0.20 |
|
|
$ |
0.44 |
|
|
$ |
0.42 |
|
|
$ |
0.35 |
|
|
$ |
0.31 |
|
Basic
weighted average shares outstanding |
62,239,028 |
|
|
62,210,834 |
|
|
62,145,045 |
|
|
62,075,983 |
|
|
61,963,948 |
|
Diluted
weighted average shares outstanding |
62,462,629 |
|
|
62,410,591 |
|
|
62,364,260 |
|
|
62,262,789 |
|
|
62,175,705 |
|
Cash
dividends declared |
$ |
0.14 |
|
|
$ |
0.14 |
|
|
$ |
0.14 |
|
|
$ |
0.13 |
|
|
$ |
0.13 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Banking Segment Financial
Information |
(dollars in thousands) |
|
|
|
|
|
|
Three Months Ended |
|
Increase/(Decrease) |
|
December 31, |
|
September 30,2017 |
|
December 31, 2017 December 31,
2016 |
|
December 31, 2017September 30,
2017 |
|
2017 |
|
2016 |
|
|
Amount |
|
Percent |
|
Amount |
|
Percent |
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income |
$ |
63,031 |
|
|
$ |
59,482 |
|
|
$ |
63,094 |
|
|
$ |
3,549 |
|
|
5.97 |
% |
|
$ |
(63 |
) |
|
(0.10 |
)% |
Noninterest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
charges on deposit accounts |
2,809 |
|
|
2,535 |
|
|
2,670 |
|
|
274 |
|
|
10.81 |
% |
|
139 |
|
|
5.21 |
% |
Credit
card merchant fees |
1,204 |
|
|
1,135 |
|
|
1,388 |
|
|
69 |
|
|
6.08 |
% |
|
(184 |
) |
|
(13.26 |
)% |
Other
income |
4,318 |
|
|
4,125 |
|
|
3,259 |
|
|
193 |
|
|
4.68 |
% |
|
1,059 |
|
|
32.49 |
% |
Subtotal |
8,331 |
|
|
7,795 |
|
|
7,317 |
|
|
536 |
|
|
6.88 |
% |
|
1,014 |
|
|
13.86 |
% |
Gain on
investment securities |
— |
|
|
6 |
|
|
— |
|
|
N/M |
|
|
N/M |
|
|
N/M |
|
|
N/M |
|
Total
noninterest income |
8,331 |
|
|
7,801 |
|
|
7,317 |
|
|
530 |
|
|
6.79 |
% |
|
1,014 |
|
|
13.86 |
% |
Total revenue |
71,362 |
|
|
67,283 |
|
|
70,411 |
|
|
4,079 |
|
|
6.06 |
% |
|
951 |
|
|
1.35 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for loan
losses |
869 |
|
|
1,801 |
|
|
696 |
|
|
(932 |
) |
|
(51.75 |
)% |
|
173 |
|
|
24.86 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits |
21,637 |
|
|
23,770 |
|
|
21,643 |
|
|
(2,133 |
) |
|
(8.97 |
)% |
|
(6 |
) |
|
(0.03 |
)% |
Occupancy expense |
4,418 |
|
|
4,349 |
|
|
3,992 |
|
|
69 |
|
|
1.59 |
% |
|
426 |
|
|
10.67 |
% |
Furniture
and equipment |
2,326 |
|
|
2,374 |
|
|
2,434 |
|
|
(48 |
) |
|
(2.02 |
)% |
|
(108 |
) |
|
(4.44 |
)% |
Advertising and
marketing |
774 |
|
|
749 |
|
|
624 |
|
|
25 |
|
|
3.34 |
% |
|
150 |
|
|
24.04 |
% |
Charitable
contributions |
891 |
|
|
1,011 |
|
|
1,380 |
|
|
(120 |
) |
|
(11.87 |
)% |
|
(489 |
) |
|
(35.43 |
)% |
Outside processing |
1,055 |
|
|
1,387 |
|
|
1,113 |
|
|
(332 |
) |
|
(23.94 |
)% |
|
(58 |
) |
|
(5.21 |
)% |
Foreclosed property
expenses |
296 |
|
|
609 |
|
|
186 |
|
|
(313 |
) |
|
(51.40 |
)% |
|
110 |
|
|
59.14 |
% |
FDIC and other
insurance |
668 |
|
|
848 |
|
|
953 |
|
|
(180 |
) |
|
(21.23 |
)% |
|
(285 |
) |
|
(29.91 |
)% |
Professional fees |
1,912 |
|
|
1,181 |
|
|
750 |
|
|
731 |
|
|
61.90 |
% |
|
1,162 |
|
|
154.93 |
% |
Telephone and
postage |
859 |
|
|
997 |
|
|
922 |
|
|
(138 |
) |
|
(13.84 |
)% |
|
(63 |
) |
|
(6.83 |
)% |
Other expenses |
5,150 |
|
|
4,240 |
|
|
4,550 |
|
|
910 |
|
|
21.46 |
% |
|
600 |
|
|
13.19 |
% |
Total expenses |
39,986 |
|
|
41,515 |
|
|
38,547 |
|
|
(1,529 |
) |
|
(3.68 |
)% |
|
1,439 |
|
|
3.73 |
% |
Income before income
tax, corporate allocation and noncontrolling interest |
30,507 |
|
|
23,967 |
|
|
31,168 |
|
|
6,540 |
|
|
27.29 |
% |
|
(661 |
) |
|
(2.12 |
)% |
Corporate
allocation |
533 |
|
|
519 |
|
|
400 |
|
|
14 |
|
|
2.70 |
% |
|
133 |
|
|
33.25 |
% |
Income before income
tax provision and noncontrolling interest |
31,040 |
|
|
24,486 |
|
|
31,568 |
|
|
6,554 |
|
|
26.77 |
% |
|
(528 |
) |
|
(1.67 |
)% |
Provision for income
tax expense |
(19,510 |
) |
|
(6,546 |
) |
|
(9,002 |
) |
|
(12,964 |
) |
|
198.04 |
% |
|
(10,508 |
) |
|
116.73 |
% |
Net income |
11,530 |
|
|
17,940 |
|
|
22,566 |
|
|
(6,410 |
) |
|
(35.73 |
)% |
|
(11,036 |
) |
|
(48.91 |
)% |
Noncontrolling
interest |
— |
|
|
(9 |
) |
|
3 |
|
|
9 |
|
|
(100.00 |
)% |
|
(3 |
) |
|
(100.00 |
)% |
Net income attributable
to TowneBank |
$ |
11,530 |
|
|
$ |
17,931 |
|
|
$ |
22,569 |
|
|
$ |
(6,401 |
) |
|
(35.70 |
)% |
|
$ |
(11,039 |
) |
|
(48.91 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Banking Segment Financial
Information |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
Increase/(Decrease) |
|
December 31, |
|
2017 over 2016 |
|
2017 |
|
2016 |
|
Amount |
|
Percent |
Revenue |
|
|
|
|
|
|
|
Net
interest income |
$ |
251,003 |
|
|
$ |
211,112 |
|
|
$ |
39,891 |
|
|
18.90 |
% |
Noninterest income |
|
|
|
|
|
|
|
Service
charges on deposit accounts |
10,594 |
|
|
9,547 |
|
|
1,047 |
|
|
10.97 |
% |
Credit
card merchant fees |
5,008 |
|
|
4,508 |
|
|
500 |
|
|
11.09 |
% |
Other
income |
14,046 |
|
|
11,503 |
|
|
2,543 |
|
|
22.11 |
% |
Subtotal |
29,648 |
|
|
25,558 |
|
|
4,090 |
|
|
16.00 |
% |
Gain
(loss) on investment securities |
(1 |
) |
|
6 |
|
|
(7 |
) |
|
(116.67 |
)% |
Total
noninterest income |
29,647 |
|
|
25,564 |
|
|
4,083 |
|
|
15.97 |
% |
Total revenue |
280,650 |
|
|
236,676 |
|
|
43,974 |
|
|
18.58 |
% |
|
|
|
|
|
|
|
|
Provision for loan
losses |
5,426 |
|
|
5,326 |
|
|
100 |
|
|
1.88 |
% |
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
Salaries
and employee benefits |
87,140 |
|
|
78,910 |
|
|
8,230 |
|
|
10.43 |
% |
Occupancy
expense |
16,365 |
|
|
15,610 |
|
|
755 |
|
|
4.84 |
% |
Furniture
and equipment |
9,406 |
|
|
8,445 |
|
|
961 |
|
|
11.38 |
% |
Advertising and marketing |
3,646 |
|
|
3,478 |
|
|
168 |
|
|
4.83 |
% |
Charitable contributions |
5,231 |
|
|
4,192 |
|
|
1,039 |
|
|
24.79 |
% |
Outside
processing |
4,434 |
|
|
4,439 |
|
|
(5 |
) |
|
(0.11 |
)% |
Foreclosed property expenses |
753 |
|
|
1,335 |
|
|
(582 |
) |
|
(43.60 |
)% |
FDIC and
other insurance |
3,739 |
|
|
4,243 |
|
|
(504 |
) |
|
(11.88 |
)% |
Professional fees |
4,691 |
|
|
4,081 |
|
|
610 |
|
|
14.95 |
% |
Telephone
and postage |
3,649 |
|
|
3,420 |
|
|
229 |
|
|
6.70 |
% |
Other
expenses |
19,800 |
|
|
34,191 |
|
|
(14,391 |
) |
|
(42.09 |
)% |
Total expenses |
158,854 |
|
|
162,344 |
|
|
(3,490 |
) |
|
(2.15 |
)% |
Income before income
tax expense, corporate allocation and noncontrolling interest |
116,370 |
|
|
69,006 |
|
|
47,364 |
|
|
68.64 |
% |
Corporate
allocation |
1,828 |
|
|
1,573 |
|
|
255 |
|
|
16.21 |
% |
Income before income
tax provision |
118,198 |
|
|
70,579 |
|
|
47,619 |
|
|
67.47 |
% |
Provision for income
tax expense |
(44,584 |
) |
|
(18,923 |
) |
|
(25,661 |
) |
|
135.61 |
% |
Net income |
73,614 |
|
|
51,656 |
|
|
21,958 |
|
|
42.51 |
% |
Noncontrolling
interest |
1 |
|
|
(28 |
) |
|
29 |
|
|
(103.57 |
)% |
Net income attributable
to TowneBank |
$ |
73,615 |
|
|
$ |
51,628 |
|
|
$ |
21,987 |
|
|
42.59 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Realty Segment Financial
Information |
(dollars in thousands) |
|
|
|
|
|
|
Three Months Ended |
|
December 31, 2017 |
|
December 31, 2017 |
|
December 31, |
|
September 30, |
|
December 31, 2016 |
September 30, 2017 |
|
2017 |
|
2016 |
|
2017 |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgage brokerage income, net |
$ |
17,544 |
|
|
$ |
18,378 |
|
|
$ |
19,196 |
|
|
$ |
(834 |
) |
|
(4.54 |
)% |
|
$ |
(1,652 |
) |
|
(8.61 |
)% |
Real
estate brokerage income, net |
2,092 |
|
|
1,761 |
|
|
2,103 |
|
|
331 |
|
|
18.80 |
% |
|
(11 |
) |
|
(0.52 |
)% |
Title
insurance and settlement fees |
431 |
|
|
422 |
|
|
509 |
|
|
9 |
|
|
2.13 |
% |
|
(78 |
) |
|
(15.32 |
)% |
Property
management fees, net |
2,731 |
|
|
1,163 |
|
|
7,939 |
|
|
1,568 |
|
|
134.82 |
% |
|
(5,208 |
) |
|
(65.60 |
)% |
Income
from unconsolidated subsidiary |
116 |
|
|
218 |
|
|
214 |
|
|
(102 |
) |
|
(46.79 |
)% |
|
(98 |
) |
|
(45.79 |
)% |
Net
interest and other income |
3,050 |
|
|
2,959 |
|
|
3,242 |
|
|
91 |
|
|
3.08 |
% |
|
(192 |
) |
|
(5.92 |
)% |
Total revenue |
25,964 |
|
|
24,901 |
|
|
33,203 |
|
|
1,063 |
|
|
4.27 |
% |
|
(7,239 |
) |
|
(21.80 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries
and employee benefits |
14,291 |
|
|
13,551 |
|
|
15,421 |
|
|
740 |
|
|
5.46 |
% |
|
(1,130 |
) |
|
(7.33 |
)% |
Occupancy
expense |
1,894 |
|
|
2,002 |
|
|
2,045 |
|
|
(108 |
) |
|
(5.39 |
)% |
|
(151 |
) |
|
(7.38 |
)% |
Furniture
and equipment |
960 |
|
|
807 |
|
|
1,036 |
|
|
153 |
|
|
18.96 |
% |
|
(76 |
) |
|
(7.34 |
)% |
Amortization of intangible assets |
571 |
|
|
565 |
|
|
718 |
|
|
6 |
|
|
1.06 |
% |
|
(147 |
) |
|
(20.47 |
)% |
Other
expenses |
6,247 |
|
|
5,909 |
|
|
6,967 |
|
|
338 |
|
|
5.72 |
% |
|
(720 |
) |
|
(10.33 |
)% |
Total expenses |
23,963 |
|
|
22,834 |
|
|
26,187 |
|
|
1,129 |
|
|
4.94 |
% |
|
(2,224 |
) |
|
(8.49 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax, corporate allocation, and noncontrolling interest |
2,001 |
|
|
2,067 |
|
|
7,016 |
|
|
(66 |
) |
|
(3.19 |
)% |
|
(5,015 |
) |
|
(71.48 |
)% |
Corporate
allocation |
(370 |
) |
|
(364 |
) |
|
(267 |
) |
|
(6 |
) |
|
1.65 |
% |
|
(103 |
) |
|
38.58 |
% |
Income before income
tax provision and noncontrolling interest |
1,631 |
|
|
1,703 |
|
|
6,749 |
|
|
(72 |
) |
|
(4.23 |
)% |
|
(5,118 |
) |
|
(75.83 |
)% |
Provision for income
tax |
(1,160 |
) |
|
(355 |
) |
|
(2,115 |
) |
|
(805 |
) |
|
226.76 |
% |
|
955 |
|
|
(45.15 |
)% |
Net income |
471 |
|
|
1,348 |
|
|
4,634 |
|
|
(877 |
) |
|
(65.06 |
)% |
|
(4,163 |
) |
|
(89.84 |
)% |
Noncontrolling
interest |
(695 |
) |
|
(675 |
) |
|
(1,189 |
) |
|
(20 |
) |
|
2.96 |
% |
|
494 |
|
|
(41.55 |
)% |
Net income (loss)
attributable to TowneBank |
$ |
(224 |
) |
|
$ |
673 |
|
|
$ |
3,445 |
|
|
$ |
(897 |
) |
|
(133.28 |
)% |
|
$ |
(3,669 |
) |
|
(106.50 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Realty Segment Financial
Information |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
Increase/(Decrease) |
|
December 31, |
|
2017 over 2016 |
|
2017 |
|
2016 |
|
Amount |
|
Percent |
Revenue |
|
|
|
|
|
|
|
Residential mortgage banking income, net |
$ |
76,245 |
|
|
$ |
59,870 |
|
|
$ |
16,375 |
|
|
27.35 |
% |
Real
estate brokerage income, net |
7,991 |
|
|
7,833 |
|
|
158 |
|
|
2.02 |
% |
Title
insurance and settlement fees |
1,877 |
|
|
1,883 |
|
|
(6 |
) |
|
(0.32 |
)% |
Property
management fees, net |
19,496 |
|
|
12,682 |
|
|
6,814 |
|
|
53.73 |
% |
Income
from unconsolidated subsidiary |
704 |
|
|
881 |
|
|
(177 |
) |
|
(20.09 |
)% |
Net
interest and other income |
11,724 |
|
|
8,854 |
|
|
2,870 |
|
|
32.41 |
% |
Total revenue |
118,037 |
|
|
92,003 |
|
|
26,034 |
|
|
28.30 |
% |
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
Salaries
and employee benefits |
$ |
58,639 |
|
|
$ |
41,706 |
|
|
$ |
16,933 |
|
|
40.60 |
% |
Occupancy
expense |
8,171 |
|
|
5,989 |
|
|
2,182 |
|
|
36.43 |
% |
Furniture
and equipment |
3,865 |
|
|
2,113 |
|
|
1,752 |
|
|
82.92 |
% |
Amortization of intangible assets |
2,566 |
|
|
1,829 |
|
|
737 |
|
|
40.30 |
% |
Other
expenses |
26,688 |
|
|
19,292 |
|
|
7,396 |
|
|
38.34 |
% |
Total expenses |
99,929 |
|
|
70,929 |
|
|
29,000 |
|
|
40.89 |
% |
|
|
|
|
|
|
|
|
Income before income
tax, corporate allocation, and noncontrolling interest |
18,108 |
|
|
21,074 |
|
|
(2,966 |
) |
|
(14.07 |
)% |
Corporate
allocation |
(1,210 |
) |
|
(935 |
) |
|
(275 |
) |
|
29.41 |
% |
Income before income
tax provision and noncontrolling interest |
16,898 |
|
|
20,139 |
|
|
(3,241 |
) |
|
(16.09 |
)% |
Provision for income
tax |
(5,791 |
) |
|
(6,184 |
) |
|
393 |
|
|
(6.36 |
)% |
Net income |
11,107 |
|
|
13,955 |
|
|
(2,848 |
) |
|
(20.41 |
)% |
Noncontrolling
interest |
(3,756 |
) |
|
(3,669 |
) |
|
(87 |
) |
|
2.37 |
% |
Net income attributable
to TowneBank |
$ |
7,351 |
|
|
$ |
10,286 |
|
|
$ |
(2,935 |
) |
|
(28.53 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Insurance Segment Financial
Information |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase/(Decrease) |
|
Three Months Ended |
|
December 31, 2017 |
|
December 31, 2017 |
|
December 31, |
|
September 30, |
|
December 31, 2016 |
|
September 30, 2017 |
|
2017 |
|
2016 |
|
2017 |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
Commission and fee
income |
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
and casualty |
$ |
8,198 |
|
|
$ |
7,614 |
|
|
$ |
9,768 |
|
|
$ |
584 |
|
|
7.67 |
% |
|
$ |
(1,570 |
) |
|
(16.07 |
)% |
Employee
benefits |
3,164 |
|
|
2,930 |
|
|
3,132 |
|
|
234 |
|
|
7.99 |
% |
|
32 |
|
|
1.02 |
% |
Travel
insurance |
912 |
|
|
828 |
|
|
970 |
|
|
84 |
|
|
10.14 |
% |
|
(58 |
) |
|
(5.98 |
)% |
Specialized benefit services |
170 |
|
|
164 |
|
|
165 |
|
|
6 |
|
|
3.66 |
% |
|
5 |
|
|
3.03 |
% |
Total commissions and
fees |
12,444 |
|
|
11,536 |
|
|
14,035 |
|
|
908 |
|
|
7.87 |
% |
|
(1,591 |
) |
|
(11.34 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingency and bonus
revenue |
1,654 |
|
|
67 |
|
|
180 |
|
|
1,587 |
|
|
N/M |
|
|
1,474 |
|
|
818.89 |
% |
Other income |
80 |
|
|
71 |
|
|
67 |
|
|
9 |
|
|
12.68 |
% |
|
13 |
|
|
19.40 |
% |
Total revenue |
14,178 |
|
|
11,674 |
|
|
14,282 |
|
|
2,504 |
|
|
21.45 |
% |
|
(104 |
) |
|
(0.73 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee
commission expense |
2,362 |
|
|
2,221 |
|
|
2,557 |
|
|
141 |
|
|
6.35 |
% |
|
(195 |
) |
|
(7.63 |
)% |
Revenue, net of
commission expense |
11,816 |
|
|
9,453 |
|
|
11,725 |
|
|
2,363 |
|
|
25.00 |
% |
|
91 |
|
|
0.78 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits |
$ |
6,552 |
|
|
$ |
5,749 |
|
|
$ |
6,403 |
|
|
$ |
803 |
|
|
13.97 |
% |
|
$ |
149 |
|
|
2.33 |
% |
Occupancy expense |
566 |
|
|
535 |
|
|
599 |
|
|
31 |
|
|
5.79 |
% |
|
(33 |
) |
|
(5.51 |
)% |
Furniture and
equipment |
169 |
|
|
196 |
|
|
240 |
|
|
(27 |
) |
|
(13.78 |
)% |
|
(71 |
) |
|
(29.58 |
)% |
Amortization of
intangible assets |
726 |
|
|
701 |
|
|
675 |
|
|
25 |
|
|
3.57 |
% |
|
51 |
|
|
7.56 |
% |
Other expenses |
1,698 |
|
|
1,304 |
|
|
1,535 |
|
|
394 |
|
|
30.21 |
% |
|
163 |
|
|
10.62 |
% |
Total operating
expenses |
9,711 |
|
|
8,485 |
|
|
9,452 |
|
|
1,226 |
|
|
14.45 |
% |
|
259 |
|
|
2.74 |
% |
Income before income
tax and noncontrolling interest |
2,105 |
|
|
968 |
|
|
2,273 |
|
|
1,137 |
|
|
117.46 |
% |
|
(168 |
) |
|
(7.39 |
)% |
Corporate
allocation |
(164 |
) |
|
(155 |
) |
|
(133 |
) |
|
(9 |
) |
|
5.81 |
% |
|
(31 |
) |
|
23.31 |
% |
Income before income
tax provision and noncontrolling interest |
1,941 |
|
|
813 |
|
|
2,140 |
|
|
1,128 |
|
|
138.75 |
% |
|
(199 |
) |
|
(9.30 |
)% |
Provision for income
tax expense |
(655 |
) |
|
(259 |
) |
|
(745 |
) |
|
(396 |
) |
|
152.90 |
% |
|
90 |
|
|
(12.08 |
)% |
Net income |
1,286 |
|
|
554 |
|
|
1,395 |
|
|
732 |
|
|
132.13 |
% |
|
(109 |
) |
|
(7.81 |
)% |
Noncontrolling
interest |
(259 |
) |
|
(162 |
) |
|
(259 |
) |
|
(97 |
) |
|
59.88 |
% |
|
— |
|
|
— |
% |
Net income attributable
to TowneBank |
$ |
1,027 |
|
|
$ |
392 |
|
|
$ |
1,136 |
|
|
$ |
635 |
|
|
161.99 |
% |
|
$ |
(109 |
) |
|
(9.60 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Insurance Segment Financial
Information |
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
Increase/(Decrease) |
|
December 31, |
|
2017 over 2016 |
|
2017 |
|
2016 |
|
Amount |
|
Percent |
Commission and fee
income |
|
|
|
|
|
|
|
Property
and casualty |
$ |
35,694 |
|
|
$ |
33,544 |
|
|
$ |
2,150 |
|
|
6.41 |
% |
Employee
benefits |
12,551 |
|
|
11,683 |
|
|
868 |
|
|
7.43 |
% |
Travel
insurance |
4,668 |
|
|
4,374 |
|
|
294 |
|
|
6.72 |
% |
Specialized benefit services |
657 |
|
|
623 |
|
|
34 |
|
|
5.46 |
% |
Total commissions and
fees |
53,570 |
|
|
50,224 |
|
|
3,346 |
|
|
6.66 |
% |
|
|
|
|
|
|
|
|
Contingency and bonus
revenue |
6,322 |
|
|
4,008 |
|
|
2,314 |
|
|
57.73 |
% |
Other income |
310 |
|
|
280 |
|
|
30 |
|
|
10.71 |
% |
Total revenue |
60,202 |
|
|
54,512 |
|
|
5,690 |
|
|
10.44 |
% |
|
|
|
|
|
|
|
|
Employee
commission expense |
9,646 |
|
|
9,124 |
|
|
522 |
|
|
5.72 |
% |
Revenue, net of
commission expense |
50,556 |
|
|
45,388 |
|
|
5,168 |
|
|
11.39 |
% |
|
|
|
|
|
|
|
|
Salaries and employee
benefits |
25,209 |
|
|
23,231 |
|
|
1,978 |
|
|
8.51 |
% |
Occupancy expense |
2,319 |
|
|
2,117 |
|
|
202 |
|
|
9.54 |
% |
Furniture and
equipment |
801 |
|
|
758 |
|
|
43 |
|
|
5.67 |
% |
Amortization of
intangible assets |
2,803 |
|
|
2,784 |
|
|
19 |
|
|
0.68 |
% |
Other expenses |
6,299 |
|
|
5,665 |
|
|
634 |
|
|
11.19 |
% |
Total operating
expenses |
37,431 |
|
|
34,555 |
|
|
2,876 |
|
|
8.32 |
% |
Income before income
tax, corporate allocation and noncontrolling interest |
13,125 |
|
|
10,833 |
|
|
2,292 |
|
|
21.16 |
% |
Corporate
allocation |
(618 |
) |
|
(638 |
) |
|
20 |
|
|
(3.13 |
)% |
Income before income
tax provision and noncontrolling interest |
12,507 |
|
|
10,195 |
|
|
2,312 |
|
|
22.68 |
% |
Provision for income
tax expense |
(4,439 |
) |
|
(3,591 |
) |
|
(848 |
) |
|
23.61 |
% |
Net income |
8,068 |
|
|
6,604 |
|
|
1,464 |
|
|
22.17 |
% |
Noncontrolling interest |
(1,371 |
) |
|
(1,268 |
) |
|
(103 |
) |
|
8.12 |
% |
Net income attributable
to TowneBank |
$ |
6,697 |
|
|
$ |
5,336 |
|
|
$ |
1,361 |
|
|
25.51 |
% |
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Reconcilement of Non-GAAP Financial
Measures: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Twelve months ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
2017 |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
|
|
|
|
|
|
|
|
|
Return on average
assets (GAAP basis) |
0.57 |
% |
|
1.26 |
% |
|
0.95 |
% |
|
1.05 |
% |
|
0.93 |
% |
Impact of excluding
average goodwill and other intangibles and amortization |
0.08 |
% |
|
0.11 |
% |
|
0.10 |
% |
|
0.10 |
% |
|
0.09 |
% |
Return on average
tangible assets (non-GAAP) |
0.65 |
% |
|
1.37 |
% |
|
1.05 |
% |
|
1.15 |
% |
|
1.02 |
% |
|
|
|
|
|
|
|
|
|
|
Return on average
equity (GAAP basis) |
4.26 |
% |
|
9.49 |
% |
|
6.95 |
% |
|
7.80 |
% |
|
6.98 |
% |
Impact of excluding
average goodwill and other intangibles and amortization |
2.13 |
% |
|
4.18 |
% |
|
3.32 |
% |
|
3.55 |
% |
|
2.95 |
% |
Return on average
tangible equity (non-GAAP) |
6.39 |
% |
|
13.67 |
% |
|
10.27 |
% |
|
11.35 |
% |
|
9.93 |
% |
|
|
|
|
|
|
|
|
|
|
Return on average
common equity (GAAP basis) |
4.30 |
% |
|
9.58 |
% |
|
7.02 |
% |
|
7.88 |
% |
|
7.05 |
% |
Impact of excluding
average goodwill and other intangibles and amortization |
2.17 |
% |
|
4.28 |
% |
|
3.40 |
% |
|
3.63 |
% |
|
3.02 |
% |
Return on average
tangible common equity (non-GAAP) |
6.47 |
% |
|
13.86 |
% |
|
10.42 |
% |
|
11.51 |
% |
|
10.07 |
% |
|
|
|
|
|
|
|
|
|
|
Book value (GAAP
basis) |
$ |
18.06 |
|
|
$ |
18.04 |
|
|
$ |
17.20 |
|
|
$ |
18.06 |
|
|
$ |
17.20 |
|
Impact of excluding
average goodwill and other intangibles and amortization |
(4.93 |
) |
|
(4.96 |
) |
|
(4.84 |
) |
|
(4.93 |
) |
|
(4.84 |
) |
Tangible book
value |
$ |
13.13 |
|
|
$ |
13.08 |
|
|
$ |
12.36 |
|
|
$ |
13.13 |
|
|
$ |
12.36 |
|
|
|
|
|
|
|
|
|
|
|
|
TOWNEBANK |
Reconcilement of Non-GAAP Financial
Measures |
(dollars in thousands, except per share
data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconcilement
of GAAP Earnings to Operating Earnings Excluding Certain Items
Affecting Comparability |
|
Three Months Ended |
|
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
|
2017 |
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
Net income (GAAP) |
|
$ |
12,333 |
|
|
$ |
27,150 |
|
|
$ |
26,213 |
|
|
$ |
21,968 |
|
|
$ |
18,996 |
|
|
|
|
|
|
|
|
|
|
|
|
Purchase accounting
corrections |
|
— |
|
|
— |
|
|
(3,889 |
) |
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
expenses |
|
526 |
|
|
466 |
|
|
1,281 |
|
|
(5 |
) |
|
(707 |
) |
|
|
|
|
|
|
|
|
|
|
|
Total charges |
|
526 |
|
|
466 |
|
|
(2,608 |
) |
|
(5 |
) |
|
(707 |
) |
Income tax expense -
tax reform legislation |
|
10,112 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Income tax expense
(benefit) - other items |
|
(98 |
) |
|
(117 |
) |
|
1,167 |
|
|
75 |
|
|
264 |
|
Total income tax
expense (benefit) |
|
10,014 |
|
|
(117 |
) |
|
1,167 |
|
|
75 |
|
|
264 |
|
Total charges, net of
taxes |
|
10,540 |
|
|
349 |
|
|
(1,441 |
) |
|
70 |
|
|
(443 |
) |
Operating earnings,
excluding certain items affecting comparability
(non-GAAP) |
|
$ |
22,873 |
|
|
$ |
27,499 |
|
|
$ |
24,772 |
|
|
$ |
22,038 |
|
|
$ |
18,553 |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
diluted shares |
|
62,462,629 |
|
|
62,410,561 |
|
|
62,364,260 |
|
|
62,262,789 |
|
|
62,175,705 |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS (GAAP) |
|
$ |
0.20 |
|
|
$ |
0.44 |
|
|
$ |
0.42 |
|
|
$ |
0.35 |
|
|
$ |
0.31 |
|
Diluted EPS, excluding
certain items affecting comparability (non-GAAP) |
|
$ |
0.37 |
|
|
$ |
0.44 |
|
|
$ |
0.40 |
|
|
$ |
0.35 |
|
|
$ |
0.30 |
|
|
|
|
|
|
|
|
|
|
|
|
Average assets |
|
$ |
8,579,705 |
|
|
$ |
8,570,019 |
|
|
$ |
8,180,959 |
|
|
$ |
8,000,366 |
|
|
$ |
7,965,438 |
|
Average tangible
equity |
|
$ |
839,942 |
|
|
$ |
824,787 |
|
|
$ |
807,085 |
|
|
$ |
791,433 |
|
|
$ |
783,789 |
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets, excluding certain items affecting comparability
(non-GAAP) |
|
1.06 |
% |
|
1.27 |
% |
|
1.21 |
% |
|
1.12 |
% |
|
0.93 |
% |
Return on average
tangible equity, excluding certain items affecting
comparability (non-GAAP) |
|
11.37 |
% |
|
13.84 |
% |
|
12.96 |
% |
|
11.91 |
% |
|
10.04 |
% |
Efficiency ratio,
excluding certain items affecting comparability
(non-GAAP) |
|
67.01 |
% |
|
63.92 |
% |
|
66.41 |
% |
|
66.80 |
% |
|
72.34 |
% |
|
|
|
|
|
|
|
|
TOWNEBANK |
Reconcilement of Non-GAAP Financial
Measures |
(dollars in thousands, except per share
data) |
|
|
|
|
|
|
|
|
|
|
Reconcilement
of GAAP Earnings to Operating Earnings Excluding Certain Items
Affecting Comparability |
|
Year Ended |
|
|
December 31, |
|
December 31, |
|
|
2017 |
|
2016 |
|
|
|
|
|
Net income (GAAP) |
|
$ |
87,663 |
|
|
$ |
67,250 |
|
|
|
|
|
|
Purchase accounting
adjustments |
|
(3,889 |
) |
|
— |
|
|
|
|
|
|
Acquisition-related
expenses |
|
2,268 |
|
|
19,111 |
|
|
|
|
|
|
Total charges |
|
(1,621 |
) |
|
19,111 |
|
|
|
|
|
|
Income tax expense -
tax reform legislation |
|
10,112 |
|
|
— |
|
Income tax expense
(benefit) - other items |
|
1,027 |
|
|
(6,213 |
) |
Total income tax
expense (benefit) |
|
11,139 |
|
|
(6,213 |
) |
Total charges, net of
taxes |
|
9,518 |
|
|
12,898 |
|
Operating earnings,
excluding certain items affecting comparability (non-GAAP) |
|
$ |
97,181 |
|
|
$ |
80,148 |
|
|
|
|
|
|
Weighted average
diluted shares |
|
62,394,282 |
|
|
56,983,305 |
|
|
|
|
|
|
Diluted EPS (GAAP) |
|
$ |
1.41 |
|
|
$ |
1.18 |
|
Diluted EPS, excluding
certain items affecting comparability (non-GAAP) |
|
$ |
1.56 |
|
|
$ |
1.41 |
|
|
|
|
|
|
Average assets |
|
$ |
8,334,999 |
|
|
$ |
7,205,236 |
|
Average tangible
equity |
|
$ |
815,969 |
|
|
$ |
716,807 |
|
|
|
|
|
|
Return on average
assets, excluding certain items affecting comparability
(non-GAAP) |
|
1.17 |
% |
|
1.11 |
% |
Return on average
tangible equity, excluding certain items
affecting comparability (non-GAAP) |
|
12.52 |
% |
|
11.73 |
% |
Efficiency ratio,
excluding certain items affecting comparability (non-GAAP) |
|
65.43 |
% |
|
66.48 |
% |
|
|
|
For more information contact:G. Robert Aston,
Jr., Chairman and CEO, 757-638-6780Clyde E. McFarland, Jr., Senior
Executive Vice President and CFO, 757-638-6801William B. Littreal,
Chief Investor Relations Officer and CSO, 757-638-6813
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