Community Trust Bancorp, Inc. (NASDAQ:CTBI):
Earnings Summary (in
thousands except per share data)
3Q
2018
2Q
2018
3Q
2017
9 Months
2018
9 Months
2017
Net income $16,106 $11,599 $13,763 $43,519 $36,581 Earnings per
share $0.91 $0.66 $0.78 $2.46 $2.08 Earnings per share - diluted
$0.91 $0.66 $0.78 $2.46 $2.07 Return on average assets 1.52%
1.11% 1.33% 1.39% 1.21% Return on average equity 11.62% 8.56%
10.45% 10.72% 9.49% Efficiency ratio 57.33% 66.05% 56.55% 60.88%
58.97% Tangible common equity 11.80% 11.51% 11.24% Dividends
declared per share $0.36 $0.33 $0.33 $1.02 $0.97 Book value per
share $31.04 $30.59 $29.58 Weighted average shares 17,691
17,687 17,633 17,683 17,625 Weighted average shares - diluted
17,710 17,703 17,653 17,700
17,645
Community Trust Bancorp, Inc. (NASDAQ:CTBI) reports record
earnings for the third quarter 2018 of $16.1 million, or $0.91 per
basic share, compared to $11.6 million, or $0.66 per basic share,
earned during the second quarter 2018 and $13.8 million, or $0.78
per basic share, earned during the third quarter 2017. Earnings for
the nine months ended September 30, 2018 were $43.5 million, or
$2.46 per basic share, compared to $36.6 million or $2.08 per basic
share earned during the nine months ended September 30, 2017.
3rd Quarter 2018 Highlights
- Net interest income for the quarter of
$36.1 million was an increase of $1.0 million, or 2.8%, from second
quarter 2018 and $1.2 million, or 3.3%, from prior year third
quarter.
- Provision for loan losses for the
quarter ended September 30, 2018 decreased $0.4 million from prior
quarter but increased $0.9 million from prior year same
quarter.
- Our loan portfolio increased $8.8
million, an annualized 1.1%, during the quarter and $64.5 million,
or 2.1%, from September 30, 2017.
- Net loan charge-offs for the quarter
ended September 30, 2018 were $1.5 million, or 0.19% of average
loans annualized, compared to $1.3 million, or 0.17%, experienced
for the second quarter 2018 and $1.4 million, or 0.18%, for the
third quarter 2017.
- Nonperforming loans at $21.0 million
decreased $1.0 million from June 30, 2018 and $9.0 million from
September 30, 2017. Nonperforming assets at $50.8 million decreased
$1.6 million from June 30, 2018 and $11.5 million from September
30, 2017.
- Deposits, including repurchase
agreements, decreased $33.6 million during the quarter but
increased $64.3 million from September 30, 2017.
- Noninterest income for the quarter
ended September 30, 2018 of $12.7 million was a decrease of $1.1
million, or 7.8%, from prior quarter but increased $0.5 million, or
3.8%, from prior year same quarter. The decrease in noninterest
income from prior quarter was primarily due to a gain in the second
quarter on the sale of a partnership interest resulting from a
low income housing tax credit recapture.
- Noninterest expense for the quarter
ended September 30, 2018 of $28.1 million decreased $4.3 million,
or 13.4%, from prior quarter, but increased $1.2 million, or 4.4%,
from prior year same quarter. The variance in noninterest expense
from prior quarter was primarily due to the previously disclosed
increase in a customer reimbursement accrual in June 2018. The
increase from prior year same quarter was primarily a result of an
increase in personnel expense with increases in salaries, bonuses,
and the cost of group medical and life insurance.
- Income tax expense continues to be
positively impacted by the change in the corporate income tax rate
from 35% to 21%. We utilize various tax exempt investments and
loans, including municipal bonds, bank owned life insurance, and
low income housing projects, to lower our effective income tax
rate. With the current tax laws, our effective tax rate for the
nine months ended September 30, 2018 was 16% compared to 28% for
the nine months ended September 30, 2017.
Net Interest Income
Net interest income for the quarter of $36.1 million was an
increase of $1.0 million, or 2.8%, from second quarter 2018 and
$1.2 million, or 3.3%, from prior year third quarter. Our net
interest margin at 3.68% increased 7 basis points from prior
quarter and 1 basis point from prior year same quarter, while our
average earning assets decreased $9.9 million but increased $80.2
million, respectively, during those same periods. Our yield on
average earning assets increased 13 basis points from prior quarter
and 27 basis points from prior year same quarter, and our cost of
funds increased 8 basis points from prior quarter and 36 basis
points from prior year same quarter. Our ratio of average loans to
deposits, including repurchase agreements, was 89.5% for the
quarter ended September 30, 2018 compared to 88.1% for the quarter
ended June 30, 2018 and 91.1% for the quarter ended September 30,
2017. Net interest income for the nine months ended September 30,
2018 increased $3.6 million from September 30, 2017 with a 3 basis
point decrease in our net interest margin and a $130.1 million
increase in average earning assets.
Noninterest Income
Noninterest income for the quarter ended September 30, 2018 of
$12.7 million was a decrease of $1.1 million, or 7.8%, from prior
quarter but a $0.5 million, or 3.8%, increase from prior year same
quarter. The decrease in noninterest income from prior quarter was
primarily due to a $1.0 million gain in the second quarter on the
sale of a partnership interest resulting from a low income
housing tax credit recapture. The increase from prior year same
quarter was a result of increases in deposit service charges ($0.2
million), trust revenue ($0.3 million), and loan related fees ($0.2
million), partially offset by a $0.2 million decrease in insurance
commissions. The increase in loan related fees was a result of
fluctuations in the fair value adjustments of our mortgage
servicing rights. Noninterest income for the nine months ended
September 30, 2018 was a $3.6 million, or 10.0%, increase from
prior year. Year over year noninterest income has been positively
impacted by increases in deposit service charges ($0.7 million),
trust revenue ($0.9 million), loan related fees ($0.5 million), and
bank owned life insurance income ($1.5 million).
Noninterest Expense
Noninterest expense for the quarter ended September 30, 2018 of
$28.1 million decreased $4.3 million, or 13.4%, from prior quarter,
but increased $1.2 million, or 4.4%, from prior year same quarter.
The variance in noninterest expense from prior quarter was
primarily due to the previously disclosed $3.6 million increase in
a customer reimbursement accrual in June 2018. The increase from
prior year same quarter was primarily a result of a $1.2 million
increase in personnel expense with increases in salaries ($0.2
million) , bonuses ($0.5 million), and the cost of group medical
and life insurance ($0.3 million). Noninterest expense for the nine
months ended September 30, 2018 was $89.2 million, a $7.1 million,
or 8.6%, increase over the first nine months of 2017, with a $3.3
million increase in personnel expense in addition to the $3.6
million increased customer reimbursement accrual discussed
above.
Balance Sheet Review
CTBI’s total assets at $4.2 billion decreased $31.3 million, or
3.0% annualized, from June 30, 2018 but increased $37.9 million, or
0.9%, from September 30, 2017. Loans outstanding at September 30,
2018 were $3.2 billion, an increase of $8.8 million, or an
annualized 1.1%, from June 30, 2018 and $64.5 million, or 2.1%,
from September 30, 2017. We experienced an increase during the
quarter of $22.4 million in the indirect loan portfolio and $0.6
million in the consumer direct loan portfolio, offset by decreases
of $13.9 in the commercial loan portfolio and $0.3 million in the
residential loan portfolio. CTBI’s investment portfolio decreased
$16.6 million, or an annualized 11.2%, from June 30, 2018 and $34.0
million, or 5.6%, from September 30, 2017. Deposits in other banks
decreased $33.8 million from prior quarter as a result of a $40
million paydown in brokered deposits. Deposits, including
repurchase agreements, at $3.5 billion decreased $33.6 million, or
an annualized 3.7%, from June 30, 2018 but increased $64.3 million,
or 1.9%, from September 30, 2017.
Shareholders’ equity at September 30, 2018 was $550.3 million, a
5.9% annualized increase from the $542.2 million at June 30, 2018
and a 5.2% increase from the $522.9 million at September 30, 2017.
CTBI’s annualized dividend yield to shareholders as of September
30, 2018 was 3.11%.
Asset Quality
CTBI’s total nonperforming loans, not including performing
troubled debt restructurings, were $21.0 million, or 0.66% of total
loans, at September 30, 2018 compared to $22.0 million, or 0.69% of
total loans, at June 30, 2018 and $30.0 million, or 0.96% of total
loans, at September 30, 2017. Accruing loans 90+ days past due
increased $0.8 million from prior quarter but decreased $2.2
million from September 30, 2017. Nonaccrual loans decreased $1.8
million during the quarter and $6.8 million from September 30,
2017. Accruing loans 30-89 days past due at $28.2 million was an
increase of $4.7 million from June 30, 2018 and $10.8 million from
September 30, 2017. Our loan portfolio management processes focus
on the immediate identification, management, and resolution of
problem loans to maximize recovery and minimize loss. Impaired
loans, loans not expected to meet contractual principal and
interest payments other than insignificant delays, at September 30,
2018 totaled $46.9 million, compared to $46.7 million at June 30,
2018 and $46.2 million at September 30, 2017.
Our level of foreclosed properties at $29.7 million at September
30, 2018 was a $0.6 million decrease from the $30.3 million at June
30, 2018 and a $2.3 million decrease from the $32.0 million at
September 30, 2017. Sales of foreclosed properties for the quarter
ended September 30, 2018 totaled $0.8 million while new foreclosed
properties totaled $0.8 million. At September 30, 2018, the book
value of properties under contracts to sell was $2.8 million;
however, the closings had not occurred at quarter-end. Write-downs
on foreclosed properties for the third quarter 2018 totaled $0.7
million compared to $0.9 million in the second quarter 2018 and in
the second quarter 2017.
Net loan charge-offs for the quarter ended September 30, 2018
were $1.5 million, or 0.19% of average loans annualized, compared
to $1.3 million, or 0.17%, experienced for the second quarter 2018
and $1.4 million, or 0.18%, for the third quarter 2017. Of the net
charge-offs for the quarter, $0.4 million were in commercial loans,
$0.9 million were in indirect auto loans, $0.1 million were in
residential loans, and $0.1 million were in consumer direct loans.
Allocations to loan loss reserves were $1.5 million for the quarter
ended September 30, 2018 compared to $1.9 million for the quarter
ended June 30, 2018 and $0.7 million for the quarter ended
September 30, 2017. Our reserve coverage (allowance for loan and
lease loss reserve to nonperforming loans) at September 30, 2018
was 170.1% compared to 162.6% at June 30, 2018 and 121.2% at
September 30, 2017. Our loan loss reserve as a percentage of total
loans outstanding remained at 1.13% from June 30, 2018 to September
30, 2018, down from the 1.17% at September 30, 2017.
Forward-Looking Statements
Certain of the statements contained herein that are not
historical facts are forward-looking statements within the meaning
of the Private Securities Litigation Reform Act. Community Trust
Bancorp, Inc.’s (“CTBI”) actual results may differ materially from
those included in the forward-looking statements. Forward-looking
statements are typically identified by words or phrases such as
“believe,” “expect,” “anticipate,” “intend,” “estimate,” “may
increase,” “may fluctuate,” and similar expressions or future or
conditional verbs such as “will,” “should,” “would,” and “could.”
These forward-looking statements involve risks and uncertainties
including, but not limited to, economic conditions, portfolio
growth, the credit performance of the portfolios, including
bankruptcies, and seasonal factors; changes in general economic
conditions including the performance of financial markets,
prevailing inflation and interest rates, realized gains from sales
of investments, gains from asset sales, and losses on commercial
lending activities; results of various investment activities; the
effects of competitors’ pricing policies, changes in laws and
regulations, competition, and demographic changes on target market
populations’ savings and financial planning needs; industry changes
in information technology systems on which we are highly dependent;
failure of acquisitions to produce revenue enhancements or cost
savings at levels or within the time frames originally anticipated
or unforeseen integration difficulties; and the resolution of legal
proceedings and related matters. In addition, the banking industry
in general is subject to various monetary, operational, and fiscal
policies and regulations, which include, but are not limited to,
those determined by the Federal Reserve Board, the Federal Deposit
Insurance Corporation, the Consumer Financial Protection Bureau,
and state regulators, whose policies and regulations could affect
CTBI’s results. These statements are representative only on the
date hereof, and CTBI undertakes no obligation to update any
forward-looking statements made.
Community Trust Bancorp, Inc., with assets of $4.2 billion, is
headquartered in Pikeville, Kentucky and has 70 banking locations
across eastern, northeastern, central, and south central Kentucky,
six banking locations in southern West Virginia, four banking
locations in northeastern Tennessee, four trust offices across
Kentucky, and one trust office in Tennessee.
Additional information follows.
Community Trust Bancorp, Inc. Financial Summary
(Unaudited) September 30, 2018 (in thousands except per
share data and # of employees)
Three Three Three Nine Nine Months Months Months Months Months
Ended Ended Ended Ended Ended September 30, 2018 June 30, 2018
September 30, 2017 September 30, 2018 September 30, 2017 Interest
income $ 43,607 $ 42,025 $ 39,844 $ 126,212 $ 115,023 Interest
expense 7,471 6,877 4,874
20,337 12,723 Net interest income
36,136 35,148 34,970 105,875 102,300 Loan loss provision 1,543
1,929 666 4,418 4,659 Gains on sales of loans 319 304 390
902 897 Deposit service charges 6,671 6,480 6,499 19,372 18,658
Trust revenue 2,836 2,856 2,534 8,650 7,769 Loan related fees 1,022
919 792 3,085 2,570 Securities gains (losses) (2 ) 2 48 (288 ) 58
Other noninterest income 1,817 3,179
1,939 7,992 6,140 Total
noninterest income 12,663 13,740 12,202 39,713 36,092
Personnel expense 15,264 15,422 14,079 46,305 43,047 Occupancy and
equipment 2,744 2,770 2,784 8,347 8,317 Data processing expense
1,695 1,634 1,772 4,965 5,318 FDIC insurance premiums 314 279 316
907 923 Other noninterest expense 8,089 12,334
7,981 28,702 24,537
Total noninterest expense 28,106 32,439 26,932 89,226 82,142
Net income before taxes 19,150 14,520 19,574 51,944 51,591
Income taxes 3,044 2,921 5,811
8,425 15,010 Net income $ 16,106
$ 11,599 $ 13,763 $ 43,519 $ 36,581
Memo: TEQ interest income $ 43,833 $ 42,253 $ 40,349
$ 126,890 $ 116,536 Average shares outstanding 17,691 17,687
17,633 17,683 17,625 Diluted average shares outstanding 17,710
17,703 17,653 17,700 17,645 Basic earnings per share $ 0.91 $ 0.66
$ 0.78 $ 2.46 $ 2.08 Diluted earnings per share $ 0.91 $ 0.66 $
0.78 $ 2.46 $ 2.07 Dividends per share $ 0.36 $ 0.33 $ 0.33 $ 1.02
$ 0.97
Average balances: Loans $ 3,167,357 $
3,131,964 $ 3,095,826 $ 3,137,027 $ 3,026,236 Earning assets
3,918,183 3,928,066 3,838,013 3,905,673 3,775,572 Total assets
4,190,768 4,196,693 4,104,226 4,177,368 4,044,509 Deposits,
including repurchase agreements 3,539,482 3,556,340 3,397,266
3,535,806 3,375,642 Interest bearing liabilities 2,789,473
2,818,168 2,763,745 2,796,724 2,718,939 Shareholders' equity
549,837 543,513 522,378 542,600 515,205
Performance
ratios: Return on average assets 1.52 % 1.11 % 1.33 % 1.39 %
1.21 % Return on average equity 11.62 % 8.56 % 10.45 % 10.72 % 9.49
% Yield on average earning assets (tax equivalent) 4.44 % 4.31 %
4.17 % 4.34 % 4.13 % Cost of interest bearing funds (tax
equivalent) 1.06 % 0.98 % 0.70 % 0.97 % 0.63 % Net interest margin
(tax equivalent) 3.68 % 3.61 % 3.67 % 3.65 % 3.68 % Efficiency
ratio (tax equivalent) 57.33 % 66.05 % 56.55 % 60.88 % 58.97 %
Loan charge-offs $ 2,828 $ 2,526 $ 2,443 $ 8,331 $ 7,123
Recoveries (1,305 ) (1,179 ) (1,035 )
(3,553 ) (2,922 ) Net charge-offs $ 1,523 $ 1,347 $ 1,408 $
4,778 $ 4,201
Market Price: High $ 52.80 $ 53.00 $
47.00 $ 53.00 $ 50.40 Low $ 45.65 $ 43.95 $ 40.33 $ 43.00 $ 40.33
Close $ 46.35 $ 49.95 $ 46.50 $ 46.35 $ 46.50 As of As of As
of September 30, 2018 June 30, 2018 September 30, 2017
Assets: Loans $ 3,177,888 $ 3,169,042 $ 3,113,421 Loan loss
reserve (35,791 ) (35,771 ) (36,391 ) Net
loans 3,142,097 3,133,271 3,077,030 Loans held for sale 1,029 1,093
1,605 Securities AFS 569,208 585,764 603,033 Securities HTM 659 659
858 Other equity investments 19,600 22,814 22,814 Other earning
assets 124,413 150,880 130,794 Cash and due from banks 53,912
54,987 48,738 Premises and equipment 45,808 46,483 46,572 Goodwill
and core deposit intangible 65,490 65,490 65,504 Other assets
151,627 143,745 138,947
Total Assets $ 4,173,843 $ 4,205,186 $
4,135,895
Liabilities and Equity: NOW accounts
$ 59,379 $ 51,563 $ 51,075 Savings deposits 1,190,977 1,156,601
1,066,020 CD's >=$100,000 624,801 694,641 682,686 Other time
deposits 571,685 587,078 613,729
Total interest bearing deposits 2,446,842 2,489,883
2,413,510 Noninterest bearing deposits 826,804
819,525 786,856 Total deposits 3,273,646
3,309,408 3,200,366 Repurchase agreements 250,983 248,781 260,007
Other interest bearing liabilities 61,433 68,121 118,406
Noninterest bearing liabilities 37,517 36,701
34,187 Total liabilities 3,623,579 3,663,011
3,612,966 Shareholders' equity 550,264 542,175
522,929
Total Liabilities and Equity $
4,173,843 $ 4,205,186 $ 4,135,895
Ending shares outstanding 17,728 17,725 17,678 Memo: Market value
of HTM securities $ 660 $ 660 $ 858 30 - 89 days past due
loans $ 28,172 $ 23,488 $ 17,403 90 days past due loans 8,005 7,189
10,222 Nonaccrual loans 13,032 14,812 19,798 Restructured loans
(excluding 90 days past due and nonaccrual) 58,008 56,814 50,819
Foreclosed properties 29,666 30,262 32,048 Other repossessed assets
54 83 160 Common equity Tier 1 capital 16.08 % 15.80 % 15.01
% Tier 1 leverage ratio 13.37 % 13.11 % 12.77 % Tier 1 risk-based
capital ratio 17.94 % 17.67 % 16.90 % Total risk based capital
ratio 19.11 % 18.84 % 18.10 % Tangible equity to tangible assets
ratio 11.80 % 11.51 % 11.24 % FTE employees 979 988 996
View source
version on businesswire.com: https://www.businesswire.com/news/home/20181017005484/en/
Community Trust Bancorp, Inc.Jean R. Hale,
606-437-3294Chairman, President, and C.E.O.
Community Trust Bancorp (NASDAQ:CTBI)
Historical Stock Chart
From May 2024 to Jun 2024
Community Trust Bancorp (NASDAQ:CTBI)
Historical Stock Chart
From Jun 2023 to Jun 2024
