First Internet Bancorp (the “Company”) (Nasdaq: INBK), the
parent company of First Internet Bank (the “Bank”), announced today
financial and operational results for the first quarter ended March
31, 2024.
First Quarter 2024 Financial
Highlights
- Net income of $5.2 million and diluted earnings per share of
$0.59, increases of 25.1% and 22.9%, respectively, from the fourth
quarter of 2023
- Net interest income of $20.7 million and fully-taxable
equivalent net interest income of $21.9 million, increases of 4.7%
and 4.2%, respectively, from the fourth quarter of 2023
- Net interest margin of 1.66% and fully-taxable equivalent
net interest margin of 1.75%, increases of 8 basis points and 7
basis points, respectively, from the fourth quarter of
2023
- Loan growth of $69.6 million, a 1.8% increase from the
fourth quarter of 2023
- Deposit growth of $206.8 million, a 5.1% increase from the
fourth quarter of 2023
- Loans to deposits ratio decreased to 91.5% from 94.4% in the
fourth quarter of 2023
- Nonperforming loans to total loans of 0.33%; net charge-offs
to average loans of 0.05%; office real estate exposure remains less
than 1% of total loans
- Tangible common equity to tangible assets of 6.79%;
excluding AOCI and adjusting for normalized cash balances, adjusted
TCE / TA was 7.61%; CET1 ratio of 9.52%
- Repurchased 10,500 shares at an avg. price of $26.94;
repurchased 513,025 shares at an avg. price of $18.58 since the
beginning of 2023, reducing share count by 5.7%
- Tangible book value per share of $41.83, a 1.0% increase
from the fourth quarter of 2023
“On our third quarter 2023 earnings conference call, we
indicated that net interest margin and net interest income had
likely bottomed and would soon trend higher,” said David Becker,
Chairman and Chief Executive Officer. “Since then, while the rate
environment has remained quite volatile, our net interest margin
and net interest income have improved by 27 basis points and 19%,
respectively, over the past two quarters, driving higher earnings
and improved profitability.
“At the same time, we’ve improved the risk profile of our
balance sheet by optimizing our loan portfolio, and further
diversifying our revenue and earnings streams. Our balance sheet
liquidity position has strengthened, our capital position remains
sturdy, and asset quality has been maintained. This strong
foundation has also positioned us to remain on offense, as we
continue to drive positive momentum in our SBA business, with
strong production and another record level of gain on sale income
during the first quarter. Amidst continued macroeconomic
uncertainty, these developments leave us confident in our ability
to drive further improvement in earnings and profitability over the
remainder of the year.”
Net Interest Income and Net Interest Margin
Net interest income for the first quarter of 2024 was $20.7
million, compared to $19.8 million for the fourth quarter of 2023,
and $19.6 million for the first quarter of 2023. On a fully-taxable
equivalent basis, net interest income for the first quarter of 2024
was $21.9 million, compared to $21.0 million for both the fourth
and first quarters of 2023.
Total interest income for the first quarter of 2024 was $68.2
million, an increase of 2.9% compared to the fourth quarter of
2023, and an increase of 31.0% compared to the first quarter of
2023. On a fully-taxable equivalent basis, total interest income
for the first quarter of 2024 was $69.4 million, an increase of
2.7% compared to the fourth quarter of 2023, and an increase of
29.8% compared to the first quarter of 2023. The yield on average
interest-earning assets for the first quarter of 2024 increased to
5.45% from 5.28% for the fourth quarter of 2023, due to a 23 basis
point (“bp”) increase in the yield earned on loans and a 9 bp
increase in the yield earned on securities, partially offset by a 6
bp decrease in the yield earned on other earning assets. Compared
to the linked quarter, average loan balances increased $92.7
million, or 2.4%, and the average balance of securities increased
$20.0 million, or 2.9%, while the average balance of other earning
assets decreased $66.6 million, or 13.3%.
Interest income earned on commercial loans was higher due to
increased average balances and the positive impact of higher rates
in the variable rate construction and small business lending
portfolios, as well as growth in the higher-yielding franchise
finance portfolio. This was partially offset by lower average
balances in the public finance and healthcare finance portfolios.
The continued shift in the loan mix reflects our focus on variable
rate and higher-yielding products, in part, to help improve the
interest rate risk profile of our balance sheet.
In the consumer loan portfolio, interest income was up modestly
due to the combination of slightly higher average balances and
continued higher new origination yields in the trailers, RV and
other consumer loan portfolios.
The yield on funded portfolio loan originations was 8.84% in the
first quarter of 2024, relatively stable with the fourth quarter of
2023, and an increase of 108 bps compared to the first quarter of
2023.
Interest income earned on securities during the first quarter of
2024 increased $0.3 million, or 4.0%, compared to the fourth
quarter of 2023 as the yield on the portfolio increased 9 bps to
3.81%, driven primarily by higher yields on new purchases and
continued slower prepayment speeds on mortgage-backed securities.
Additionally, the average balance of securities increased $20.0
million, or 2.9%, during the first quarter of 2024. Interest earned
on other earning asset balances decreased $1.1 million, or 15.4%,
in the first quarter of 2024 compared to the linked quarter, due
primarily to lower average cash balances and slightly lower
yields.
Total interest expense for the first quarter of 2024 was $47.4
million, an increase of $1.0 million, or 2.1%, compared to the
linked quarter as short-term rates remained stable throughout the
quarter while average interest-bearing deposit balances increased
$51.5 million, or 1.3%. Interest expense related to
interest-bearing deposits increased $1.1 million, or 2.6%, driven
primarily by higher costs on certificates of deposits (“CDs”),
interest-bearing demand deposits and BaaS – brokered deposits. The
cost of interest-bearing deposits was 4.25% for the first quarter
of 2024, compared to 4.14% for the fourth quarter of 2023.
Average CD balances increased $22.6 million, or 1.4%, compared
to the linked quarter, driven by strong consumer demand, while the
cost of funds increased 15 bps. The increase in the cost of CDs is
the lowest in the past seven quarters, reflecting the narrowing gap
between rates on new production and maturities. The average balance
of interest-bearing demand deposits increased $32.7 million, or
8.5%, due to growth in fintech partnership deposits, while the cost
of funds increased 32 bps. The average balance of BaaS – brokered
deposits increased $23.3 million, or 37.5%, due to higher payments
volumes, while the cost of funds increased 1 bp.
These increases were partially offset by lower average brokered
deposit balances, which decreased $19.4 million, or 3.1%, as excess
liquidity was used to redeem $17.9 million of callable brokered
CDs.
Net interest margin (“NIM”) was 1.66% for the first quarter of
2024, up from 1.58% for the fourth quarter of 2023 and down from
1.76% for the first quarter of 2023. Fully-taxable equivalent NIM
(“FTE NIM”) was 1.75% for the first quarter of 2024, up from 1.68%
for the fourth quarter of 2023 and down from 1.89% for the first
quarter of 2023. The increases in NIM and FTE NIM compared to the
linked quarter were driven primarily by higher yields on loans and
securities, as well as higher average loan and securities balances,
partially offset by higher interest-bearing deposit costs and lower
average cash balances.
Noninterest Income
Noninterest income for the first quarter of 2024 was $8.3
million, compared to $7.4 million for the fourth quarter of 2023,
and $5.4 million for the first quarter of 2023. Gain on sale of
loans totaled $6.5 million in the first quarter of 2024, increasing
$0.5 million, or 8.4%, compared to the linked quarter. Gain on sale
revenue consisted almost entirely of sales of U.S. Small Business
Administration (“SBA”) 7(a) guaranteed loans during the first
quarter of 2024. Loan sale volume was down seasonally, decreasing
11.5% compared to the linked quarter, but was more than offset by a
158 bp increase in net premiums. Net loan servicing revenue
increased $0.5 million during the quarter due to growth in the
servicing portfolio and the change in the fair value adjustment to
the loan servicing asset.
Noninterest Expense
Noninterest expense totaled $21.0 million for the first quarter
of 2024, compared to $20.1 million for the fourth quarter of 2023,
and $21.0 million for the first quarter of 2023, representing
increases of 4.8% and 0.3%, respectively. The increase of $1.0
million compared to the linked quarter was due primarily to higher
salaries and employee benefits and marketing expenses.
The increase in salaries and employee benefits was due primarily
to annual resets on certain employee benefits, payroll taxes and
incentive compensation accruals, as well as annual merit increases
and new hires, partially offset by lower small business incentive
compensation and lower medical claims. The increase in marketing
expenses was due mainly to higher advertising, media and
sponsorship costs.
Income Taxes
The Company recorded income tax expense of $0.4 million and an
effective tax rate of 7.6% for the first quarter of 2024, compared
to income tax benefits of $0.6 million and $2.3 million for the
fourth and first quarters of 2023, respectively.
Loans and Credit Quality
Total loans as of March 31, 2024 were $3.9 billion, an increase
of $69.6 million, or 1.8%, compared to December 31, 2023, and an
increase of $302.6 million, or 8.4%, compared to March 31, 2023.
Total commercial loan balances were $3.1 billion as of March 31,
2024, an increase of $75.2 million, or 2.5%, compared to December
31, 2023, and an increase of $275.4 million, or 9.8%, compared to
March 31, 2023. Compared to the linked quarter, the increase in
commercial loan balances was driven primarily by growth in higher
yielding construction, small business lending and franchise finance
balances. These items were partially offset by decreases in the
fixed-rate public finance and healthcare finance portfolios.
Total consumer loan balances were $793.4 million as of March 31,
2024, a decrease of $3.5 million, or 0.4%, compared to December 31,
2023, and an increase of $37.1 million, or 4.9%, compared to March
31, 2023. The slight decline compared to the linked quarter was due
primarily to a decrease in the residential mortgage portfolio,
partially offset by an increase in the trailers portfolio.
Total delinquencies 30 days or more past due were 0.53% of total
loans as of March 31, 2024, compared to 0.31% at December 31, 2023,
and 0.13% as of March 31, 2023. The increase during the first
quarter of 2024 was due primarily to an increase in delinquencies
in the small business lending and franchise finance portfolios,
some of which was due to the timing of principal and interest
payments. Subsequent to quarter end, payments were received from a
number of borrowers and as of the date of this release,
delinquencies 30 days or more past due declined to 0.32% of total
loans, relatively consistent with the linked quarter.
Nonperforming loans were 0.33% of total loans as of March 31,
2024, compared to 0.26% as of both December 31, 2023 and March 31,
2023. Nonperforming loans totaled $13.1 million at March 31, 2024,
up from $10.0 million at December 31, 2023. The increase in
nonperforming loans was due primarily to an increase in
nonperforming small business lending loans and, to a lesser extent,
an increase in nonperforming residential mortgage loans.
The allowance for credit losses (“ACL”) as a percentage of total
loans was 1.05% as of March 31, 2024, compared to 1.01% as of
December 31, 2023, and 1.02% as of March 31, 2023. The increase in
the ACL reflects the addition of specific reserves on nonperforming
small business lending loans, as well as growth in certain loan
portfolios, partially offset by the positive impact of economic
data on forecasted loss rates and qualitative factors on other
portfolios.
Net charge-offs of $0.5 million were recognized during the first
quarter of 2024, resulting in net charge-offs to average loans of
0.05%, compared to $1.2 million, or 0.12%, for the fourth quarter
of 2023, and $7.2 million, or 0.82%, for the first quarter of 2023.
Net charge-offs in the first quarter of 2024 were driven primarily
by small business and consumer lending.
The provision for credit losses in the first quarter of 2024 was
$2.4 million, compared to $3.6 million for the fourth quarter of
2023, and $9.4 million for the first quarter of 2023. The provision
for the first quarter of 2024 was driven primarily by specific
reserves, growth in certain loan portfolios and net charge-offs,
partially offset by the positive impact of economic forecasts on
other portfolios.
Capital
As of March 31, 2024, total shareholders’ equity was $366.7
million, an increase of $3.9 million, or 1.1%, compared to December
31, 2023, and an increase of $11.2 million, or 3.1%, compared to
March 31, 2023. The increase in shareholders’ equity during the
first quarter of 2024 compared to the linked quarter was due
primarily to the net income earned during the quarter, partially
offset by a slight increase in accumulated other comprehensive
loss. Book value per common share increased to $42.37 as of March
31, 2024, up from $41.97 as of December 31, 2023, and $39.76 as of
March 31, 2023. Tangible book value per share was $41.83 as of
March 31, 2024, up from $41.43 as of December 31, 2023, and $39.23
as of March 31, 2023.
In connection with its previously announced stock repurchase
program, the Company repurchased 10,500 shares of its common stock
during the first quarter of 2024 at an average price of $26.94 per
share. The Company has repurchased $41.7 million of stock under its
authorized programs since November of 2021.
The following table presents the Company’s and the Bank’s
regulatory and other capital ratios as of March 31, 2024.
As of March 31, 2024
Company
Bank
Total shareholders' equity to assets
6.87%
8.39%
Tangible common equity to tangible assets
1
6.79%
8.31%
Tier 1 leverage ratio 2
7.33%
8.92%
Common equity tier 1 capital ratio 2
9.52%
11.60%
Tier 1 capital ratio 2
9.52%
11.60%
Total risk-based capital ratio 2
13.18%
12.66%
1 This information represents a non-GAAP
financial measure. For a discussion of non-GAAP financial measures,
see the section below entitled "Non-GAAP Financial Measures."
2 Regulatory capital ratios are
preliminary pending filing of the Company's and the Bank's
regulatory reports.
Conference Call and Webcast
The Company will host a conference call and webcast at 2:00 p.m.
Eastern Time on Thursday, April 25, 2024 to discuss its quarterly
financial results. The call can be accessed via telephone at (888)
259-6580; access code: 28021175. A recorded replay can be accessed
through May 25, 2024 by dialing (877) 674-7070; access code:
021175.
Additionally, interested parties can listen to a live webcast of
the call on the Company's website at www.firstinternetbancorp.com.
An archived version of the webcast will be available in the same
location shortly after the live call has ended.
About First Internet Bancorp
First Internet Bancorp is a financial holding company with
assets of $5.3 billion as of March 31, 2024. The Company’s
subsidiary, First Internet Bank, opened for business in 1999 as an
industry pioneer in the branchless delivery of banking services.
First Internet Bank provides consumer and small business deposit,
SBA financing, franchise finance, consumer loans, and specialty
finance services nationally as well as commercial real estate
loans, construction loans, commercial and industrial loans, and
treasury management services on a regional basis. First Internet
Bancorp’s common stock trades on the Nasdaq Global Select Market
under the symbol “INBK”. Additional information about the Company
is available at www.firstinternetbancorp.com and additional
information about First Internet Bank, including its products and
services, is available at www.firstib.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, including statements with respect to
the financial condition, results of operations, trends in lending
policies and loan programs, plans and prospective business
partnerships, objectives, future performance and business of the
Company. Forward-looking statements are generally identifiable by
the use of words such as “anticipate,” “believe,” “continue,”
“could,” “estimate,” “expect,” “growth,” “help,” :improve,” “may,”
“ongoing,” “opportunities,” “pending,” “plan,” “position,”
“preliminary,” “remain,” “should,” “thereafter,” “well-positioned,”
“will,” or other similar expressions. Forward-looking statements
are not a guarantee of future performance or results, are based on
information available at the time the statements are made and
involve known and unknown risks, uncertainties and other factors
that could cause actual results to differ materially from the
information in the forward-looking statements. Such statements are
subject to certain risks and uncertainties including: our business
and operations and the business and operations of our vendors and
customers: general economic conditions, whether national or
regional, and conditions in the lending markets in which we
participate that may have an adverse effect on the demand for our
loans and other products; our credit quality and related levels of
nonperforming assets and loan losses, and the value and salability
of the real estate that is the collateral for our loans. Other
factors that may cause such differences include: failures or
breaches of or interruptions in the communications and information
systems on which we rely to conduct our business; failure of our
plans to grow our commercial and industrial, construction, SBA, and
franchise finance loan portfolios; competition with national,
regional and community financial institutions; the loss of any key
members of senior management; the anticipated impacts of inflation
and rising interest rates on the general economy; risks relating to
the regulation of financial institutions; and other factors
identified in reports we file with the U.S. Securities and Exchange
Commission. All statements in this press release, including
forward-looking statements, speak only as of the date they are
made, and the Company undertakes no obligation to update any
statement in light of new information or future events.
Non-GAAP Financial Measures
This press release contains financial information determined by
methods other than in accordance with U.S. generally accepted
accounting principles (“GAAP”). Non-GAAP financial measures,
specifically tangible common equity, tangible assets, tangible book
value per common share, tangible common equity to tangible assets,
average tangible common equity, return on average tangible common
equity, total interest income – FTE, net interest income – FTE, net
interest margin – FTE, adjusted total revenue, adjusted noninterest
income, adjusted noninterest expense, adjusted income before income
taxes, adjusted income tax provision (benefit), adjusted net
income, adjusted diluted earnings per share, adjusted return on
average assets, adjusted return on average shareholders’ equity and
adjusted return on average tangible common equity are used by the
Company’s management to measure the strength of its capital and
analyze profitability, including its ability to generate earnings
on tangible capital invested by its shareholders. Although
management believes these non-GAAP measures are useful to investors
by providing a greater understanding of its business, they should
not be considered a substitute for financial measures determined in
accordance with GAAP, nor are they necessarily comparable to
non-GAAP performance measures that may be presented by other
companies. Reconciliations of these non-GAAP financial measures to
the most directly comparable GAAP financial measures are included
in the table at the end of this release under the caption
“Reconciliation of Non-GAAP Financial Measures.”
First Internet Bancorp Summary Financial Information
(unaudited) Dollar amounts in thousands, except per share data
Three Months Ended March 31, December
31, March 31,
2024
2023
2023
Net income (loss)
$
5,181
$
4,143
$
(3,017
)
Per share and share information Earnings (loss) per
share - basic
$
0.60
$
0.48
$
(0.33
)
Earnings (loss) per share - diluted
0.59
0.48
(0.33
)
Dividends declared per share
0.06
0.06
0.06
Book value per common share
42.37
41.97
39.76
Tangible book value per common share 1
41.83
41.43
39.23
Common shares outstanding
8,655,854
8,644,451
8,943,477
Average common shares outstanding: Basic
8,679,429
8,683,331
9,024,072
Diluted
8,750,297
8,720,078
9,024,072
Performance ratios Return on average assets
0.40
%
0.32
%
(0.26
%)
Return on average shareholders' equity
5.64
%
4.66
%
(3.37
%)
Return on average tangible common equity1
5.71
%
4.72
%
(3.41
%)
Net interest margin
1.66
%
1.58
%
1.76
%
Net interest margin - FTE1,2
1.75
%
1.68
%
1.89
%
Capital ratios3 Total shareholders' equity to assets
6.87
%
7.02
%
7.53
%
Tangible common equity to tangible assets1
6.79
%
6.94
%
7.44
%
Tier 1 leverage ratio
7.33
%
7.33
%
8.10
%
Common equity tier 1 capital ratio
9.52
%
9.60
%
10.30
%
Tier 1 capital ratio
9.52
%
9.60
%
10.30
%
Total risk-based capital ratio
13.18
%
13.23
%
14.13
%
Asset quality Nonperforming loans
$
13,050
$
9,962
$
9,221
Nonperforming assets
13,425
10,354
9,346
Nonperforming loans to loans
0.33
%
0.26
%
0.26
%
Nonperforming assets to total assets
0.25
%
0.20
%
0.20
%
Allowance for credit losses - loans to: Loans
1.05
%
1.01
%
1.02
%
Nonperforming loans
313.3
%
389.2
%
400.0
%
Net charge-offs to average loans
0.05
%
0.12
%
0.82
%
Average balance sheet information Loans
$
3,889,667
$
3,799,211
$
3,573,827
Total securities
703,509
$
683,468
$
585,270
Other earning assets
434,118
$
500,733
$
331,294
Total interest-earning assets
5,030,216
$
4,984,133
$
4,499,782
Total assets
5,207,936
$
5,154,285
$
4,647,156
Noninterest-bearing deposits
113,341
$
123,351
$
134,988
Interest-bearing deposits
3,987,009
$
3,935,519
$
3,411,969
Total deposits
4,100,350
$
4,058,870
$
3,546,957
Shareholders' equity
369,371
$
353,037
$
363,273
1 Refer to "Non-GAAP Financial Measures" section above and
"Reconciliation of Non-GAAP Financial Measures" below 2 On a
fully-taxable equivalent ("FTE") basis assuming a 21% tax rate 3
Regulatory capital ratios are preliminary pending filing of the
Company's regulatory reports
First Internet Bancorp
Condensed Consolidated Balance Sheets (unaudited, except for
December 31, 2023) Dollar amounts in thousands
March
31, December 31, March 31,
2024
2023
2023
Assets Cash and due from banks
$
6,638
$
8,269
$
27,741
Interest-bearing deposits
474,626
397,629
276,231
Securities available-for-sale, at fair value
482,431
474,855
395,833
Securities held-to-maturity, at amortized cost, net of allowance
for credit losses
235,738
227,153
210,761
Loans held-for-sale
22,589
22,052
18,144
Loans
3,909,804
3,840,220
3,607,242
Allowance for credit losses - loans
(40,891
)
(38,774
)
(36,879
)
Net loans
3,868,913
3,801,446
3,570,363
Accrued interest receivable
26,809
26,746
22,322
Federal Home Loan Bank of Indianapolis stock
28,350
28,350
28,350
Cash surrender value of bank-owned life insurance
41,154
40,882
40,105
Premises and equipment, net
73,231
73,463
74,248
Goodwill
4,687
4,687
4,687
Servicing asset
11,760
10,567
7,312
Other real estate owned
375
375
106
Accrued income and other assets
63,366
51,098
45,116
Total assets
$
5,340,667
$
5,167,572
$
4,721,319
Liabilities Noninterest-bearing deposits
$
130,760
$
123,464
$
140,449
Interest-bearing deposits
4,143,008
3,943,509
3,481,841
Total deposits
4,273,768
4,066,973
3,622,290
Advances from Federal Home Loan Bank
574,936
614,934
614,929
Subordinated debt
104,915
104,838
104,608
Accrued interest payable
3,382
3,848
2,592
Accrued expenses and other liabilities
16,927
14,184
21,328
Total liabilities
4,973,928
4,804,777
4,365,747
Shareholders' equity Voting common stock
184,720
184,700
189,202
Retained earnings
212,121
207,470
197,623
Accumulated other comprehensive loss
(30,102
)
(29,375
)
(31,253
)
Total shareholders' equity
366,739
362,795
355,572
Total liabilities and shareholders' equity
$
5,340,667
$
5,167,572
$
4,721,319
First Internet Bancorp Condensed Consolidated Statements
of Income (unaudited) Dollar amounts in thousands, except per
share data
Three Months Ended March 31,
December 31, March 31,
2024
2023
2023
Interest income Loans
$
55,435
$
52,690
$
43,843
Securities - taxable
5,694
5,447
3,606
Securities - non-taxable
969
962
798
Other earning assets
6,067
7,173
3,786
Total interest income
68,165
66,272
52,033
Interest expense Deposits
42,129
41,078
27,270
Other borrowed funds
5,302
5,387
5,189
Total interest expense
47,431
46,465
32,459
Net interest income
20,734
19,807
19,574
Provision for credit losses
2,448
3,594
9,415
Net interest income after provision for credit losses
18,286
16,213
10,159
Noninterest income Service charges and fees
220
216
209
Loan servicing revenue
1,323
1,134
785
Loan servicing asset revaluation
(434
)
(793
)
(55
)
Mortgage banking activities
-
-
76
Gain on sale of loans
6,536
6,028
4,061
Other
702
816
370
Total noninterest income
8,347
7,401
5,446
Noninterest expense Salaries and employee benefits
11,796
11,055
11,794
Marketing, advertising and promotion
736
518
844
Consulting and professional fees
853
893
926
Data processing
564
493
659
Loan expenses
1,445
1,371
1,977
Premises and equipment
2,826
2,846
2,777
Deposit insurance premium
1,145
1,334
543
Other
1,658
1,546
1,434
Total noninterest expense
21,023
20,056
20,954
Income (loss) before income taxes
5,610
3,558
(5,349
)
Income tax provision (benefit)
429
(585
)
(2,332
)
Net income (loss)
$
5,181
$
4,143
$
(3,017
)
Per common share data Earnings (loss) per share -
basic
$
0.60
$
0.48
$
(0.33
)
Earnings (loss) per share - diluted
$
0.59
$
0.48
$
(0.33
)
Dividends declared per share
$
0.06
$
0.06
$
0.06
All periods presented have been reclassified to conform to
the current period classification
First Internet Bancorp
Average Balances and Rates (unaudited) Dollar amounts in
thousands
Three Months Ended March 31,
2024 December 31, 2023 March 31, 2023
Average Interest/ Yield/ Average
Interest/ Yield/ Average Interest/
Yield/ Balance Dividends Cost
Balance Dividends Cost Balance
Dividends Cost Assets Interest-earning
assets Loans, including loans held-for-sale1
$
3,892,589
$
55,435
5.73
%
$
3,799,932
$
52,690
5.50
%
$
3,583,218
$
43,843
4.96
%
Securities - taxable
627,216
5,694
3.65
%
611,664
5,447
3.53
%
511,923
3,606
2.86
%
Securities - non-taxable
76,293
969
5.11
%
71,804
962
5.32
%
73,347
798
4.41
%
Other earning assets
434,118
6,067
5.62
%
500,733
7,173
5.68
%
331,294
3,786
4.63
%
Total interest-earning assets
5,030,216
68,165
5.45
%
4,984,133
66,272
5.28
%
4,499,782
52,033
4.69
%
Allowance for credit losses - loans
(38,611
)
(36,792
)
(35,075
)
Noninterest-earning assets
216,331
206,944
182,449
Total assets
$
5,207,936
$
5,154,285
$
4,647,156
Liabilities Interest-bearing liabilities
Interest-bearing demand deposits
$
415,106
$
2,091
2.03
%
$
382,427
$
1,646
1.71
%
$
333,642
$
900
1.09
%
Savings accounts
22,521
48
0.86
%
22,394
48
0.85
%
38,482
82
0.86
%
Money market accounts
1,217,966
12,671
4.18
%
1,225,781
12,739
4.12
%
1,377,600
12,300
3.62
%
BaaS - brokered deposits
85,366
931
4.39
%
62,098
685
4.38
%
14,741
138
3.80
%
Certificates and brokered deposits
2,246,050
26,388
4.73
%
2,242,819
25,960
4.59
%
1,647,504
13,850
3.41
%
Total interest-bearing deposits
3,987,009
42,129
4.25
%
3,935,519
41,078
4.14
%
3,411,969
27,270
3.24
%
Other borrowed funds
716,735
5,302
2.98
%
719,733
5,387
2.97
%
719,499
5,189
2.92
%
Total interest-bearing liabilities
4,703,744
47,431
4.06
%
4,655,252
46,465
3.96
%
4,131,468
32,459
3.19
%
Noninterest-bearing deposits
113,341
123,351
134,988
Other noninterest-bearing liabilities
21,480
22,645
17,427
Total liabilities
4,838,565
4,801,248
4,283,883
Shareholders' equity
369,371
353,037
363,273
Total liabilities and shareholders' equity
$
5,207,936
$
5,154,285
$
4,647,156
Net interest income
$
20,734
$
19,807
$
19,574
Interest rate spread
1.39
%
1.32
%
1.50
%
Net interest margin
1.66
%
1.58
%
1.76
%
Net interest margin - FTE2,3
1.75
%
1.68
%
1.89
%
1 Includes nonaccrual loans 2 On a fully-taxable equivalent
("FTE") basis assuming a 21% tax rate 3 Refer to "Non-GAAP
Financial Measures" section above and "Reconciliation of Non-GAAP
Financial Measures" below
First Internet Bancorp Loans
and Deposits (unaudited) Dollar amounts in thousands
March 31, 2024 December 31, 2023 March 31,
2023 Amount Percent Amount Percent
Amount Percent Commercial loans
Commercial and industrial
$
133,897
3.4
%
$
129,349
3.4
%
$
113,198
3.1
%
Owner-occupied commercial real estate
57,787
1.5
%
57,286
1.5
%
59,643
1.7
%
Investor commercial real estate
128,276
3.3
%
132,077
3.4
%
142,174
3.9
%
Construction
325,597
8.3
%
261,750
6.8
%
158,147
4.4
%
Single tenant lease financing
941,597
24.1
%
936,616
24.4
%
952,533
26.4
%
Public finance
498,262
12.7
%
521,764
13.6
%
604,898
16.8
%
Healthcare finance
213,332
5.5
%
222,793
5.8
%
256,670
7.1
%
Small business lending
239,263
6.1
%
218,506
5.7
%
136,382
3.8
%
Franchise finance
543,122
13.9
%
525,783
13.7
%
382,161
10.6
%
Total commercial loans
3,081,133
78.8
%
3,005,924
78.3
%
2,805,806
77.8
%
Consumer loans Residential mortgage
390,009
10.0
%
395,648
10.3
%
392,062
10.9
%
Home equity
22,753
0.6
%
23,669
0.6
%
26,160
0.7
%
Trailers
191,353
4.9
%
188,763
4.9
%
172,640
4.8
%
Recreational vehicles
145,475
3.7
%
145,558
3.8
%
128,307
3.6
%
Other consumer loans
43,847
1.1
%
43,293
1.1
%
37,186
1.0
%
Total consumer loans
793,437
20.3
%
796,931
20.7
%
756,355
21.0
%
Net deferred loan fees, premiums, discounts and other1
35,234
0.9
%
37,365
1.0
%
45,081
1.2
%
Total loans
$
3,909,804
100.0
%
$
3,840,220
100.0
%
$
3,607,242
100.0
%
March 31, 2024 December 31, 2023
March 31, 2023 Amount Percent Amount
Percent Amount Percent Deposits
Noninterest-bearing deposits
$
130,760
3.1
%
$
123,464
3.0
%
$
140,449
3.9
%
Interest-bearing demand deposits
423,529
9.9
%
402,976
9.9
%
351,641
9.7
%
Savings accounts
23,554
0.6
%
21,364
0.5
%
32,762
0.9
%
Money market accounts
1,251,230
29.2
%
1,248,319
30.8
%
1,254,013
34.6
%
BaaS - brokered deposits
107,911
2.5
%
74,401
1.8
%
25,725
0.7
%
Certificates of deposits
1,738,996
40.7
%
1,605,156
39.5
%
1,170,094
32.3
%
Brokered deposits
597,788
14.0
%
591,293
14.5
%
647,606
17.9
%
Total deposits
$
4,273,768
100.0
%
$
4,066,973
100.0
%
$
3,622,290
100.0
%
1 Includes carrying value adjustments of $26.9 million,
$27.8 million and $31.5 million related to terminated interest rate
swaps associated with public finance loans as of March 31, 2024,
December 31, 2023 and March 31, 2023, respectively.
First
Internet Bancorp Reconciliation of Non-GAAP Financial
Measures Dollar amounts in thousands, except per share data
Three Months Ended March 31,
December 31, March 31,
2024
2023
2023
Total equity - GAAP
$
366,739
$
362,795
$
355,572
Adjustments: Goodwill
(4,687
)
(4,687
)
(4,687
)
Tangible common equity
$
362,052
$
358,108
$
350,885
Total assets - GAAP
$
5,340,667
$
5,167,572
$
4,721,319
Adjustments: Goodwill
(4,687
)
(4,687
)
(4,687
)
Tangible assets
$
5,335,980
$
5,162,885
$
4,716,632
Common shares outstanding
8,655,854
8,644,451
8,943,477
Book value per common share
$
42.37
$
41.97
$
39.76
Effect of goodwill
(0.54
)
(0.54
)
(0.53
)
Tangible book value per common share
$
41.83
$
41.43
$
39.23
Total shareholders' equity to assets
6.87
%
7.02
%
7.53
%
Effect of goodwill
(0.08
%)
(0.08
%)
(0.09
%)
Tangible common equity to tangible assets
6.79
%
6.94
%
7.44
%
Total average equity - GAAP
$
369,371
$
353,037
$
363,273
Adjustments: Average goodwill
(4,687
)
(4,687
)
(4,687
)
Average tangible common equity
$
364,684
$
348,350
$
358,586
Return on average shareholders' equity
5.64
%
4.66
%
(3.37
%)
Effect of goodwill
0.07
%
0.06
%
(0.04
%)
Return on average tangible common equity
5.71
%
4.72
%
(3.41
%)
Total interest income
$
68,165
$
66,272
$
52,033
Adjustments: Fully-taxable equivalent adjustments1
1,190
1,238
1,383
Total interest income - FTE
$
69,355
$
67,510
$
53,416
Net interest income
$
20,734
$
19,807
$
19,574
Adjustments: Fully-taxable equivalent adjustments1
1,190
1,238
1,383
Net interest income - FTE
$
21,924
$
21,045
$
20,957
Net interest margin
1.66
%
1.58
%
1.76
%
Effect of fully-taxable equivalent adjustments1
0.09
%
0.10
%
0.13
%
Net interest margin - FTE
1.75
%
1.68
%
1.89
%
1 Assuming a 21% tax rate
First Internet Bancorp
Reconciliation of Non-GAAP Financial Measures Dollar amounts
in thousands, except per share data
Three Months
Ended March 31, December 31, March
31,
2024
2023
2023
Total revenue - GAAP
$
29,081
$
27,208
$
25,020
Adjustments: Mortgage-related revenue
-
-
(65
)
Adjusted total revenue
$
29,081
$
27,208
$
24,955
Noninterest income - GAAP
$
8,347
$
7,401
$
5,446
Adjustments: Mortgage-related revenue
-
-
(65
)
Adjusted noninterest income
$
8,347
$
7,401
$
5,381
Noninterest expense - GAAP
$
21,023
$
20,056
$
20,954
Adjustments: Mortgage-related costs
-
-
(3,052
)
Adjusted noninterest expense
$
21,023
$
20,056
$
17,902
Income (loss) before income taxes - GAAP
$
5,610
$
3,558
$
(5,349
)
Adjustments:1 Mortgage-related revenue
-
-
(65
)
Mortgage-related costs
-
-
3,052
Partial charge-off of C&I participation loan
-
-
6,914
Adjusted income before income taxes
$
5,610
$
3,558
$
4,552
Income tax provision (benefit) - GAAP
$
429
$
(585
)
$
(2,332
)
Adjustments:1 Mortgage-related revenue
-
-
(14
)
Mortgage-related costs
-
-
641
Partial charge-off of C&I participation loan
-
-
1,452
Adjusted income tax provision (benefit)
$
429
$
(585
)
$
(253
)
Net income (loss) - GAAP
$
5,181
$
4,143
$
(3,017
)
Adjustments: Mortgage-related revenue
-
-
(51
)
Mortgage-related costs
-
-
2,411
Partial charge-off of C&I participation loan
-
-
5,462
Adjusted net income
$
5,181
$
4,143
$
4,805
1 Assuming a 21% tax rate
First Internet Bancorp
Reconciliation of Non-GAAP Financial Measures Dollar amounts
in thousands, except per share data
Three Months
Ended March 31, December 31, March
31,
2024
2023
2023
Diluted average common shares outstanding
8,750,297
8,720,078
9,024,072
Diluted earnings (loss) per share - GAAP
$
0.59
$
0.48
$
(0.33
)
Adjustments: Effect of mortgage-related revenue
-
-
(0.01
)
Effect of mortgage-related costs
-
-
0.27
Effect of partial charge-off of C&I participation loan
-
-
0.60
Adjusted diluted earnings per share
$
0.59
$
0.48
$
0.53
Return on average assets
0.40
%
0.32
%
(0.26
%)
Effect of mortgage-related revenue
0.00
%
0.00
%
0.00
%
Effect of mortgage-related costs
0.00
%
0.00
%
0.21
%
Effect of partial charge-off of C&I participation loan
0.00
%
0.00
%
0.48
%
Adjusted return on average assets
0.40
%
0.32
%
0.43
%
Return on average shareholders' equity
5.64
%
4.66
%
(3.37
%)
Effect of mortgage-related revenue
0.00
%
0.00
%
(0.06
%)
Effect of mortgage-related costs
0.00
%
0.00
%
2.69
%
Effect of partial charge-off of C&I participation loan
0.00
%
0.00
%
6.10
%
Adjusted return on average shareholders' equity
5.64
%
4.66
%
5.36
%
Return on average tangible common equity
5.71
%
4.72
%
(3.41
%)
Effect of mortgage-related revenue
0.00
%
0.00
%
(0.06
%)
Effect of mortgage-related costs
0.00
%
0.00
%
2.73
%
Effect of partial charge-off of C&I participation loan
0.00
%
0.00
%
6.18
%
Adjusted return on average tangible common equity
5.71
%
4.72
%
5.44
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240422407933/en/
Investors/Analysts Paula Deemer
Director of Corporate Administration (317) 428-4628
investors@firstib.com
Media BLASTmedia for First Internet
Bank Zach Weismiller firstib@blastmedia.com
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