First Mid Bancshares, Inc. (NASDAQ: FMBH) (the “Company”) today
announced its financial results for the quarter ended March 31,
2023.
Highlights
- Net income of $19.2 million, or $0.93 diluted EPS
- Adjusted net income (non-GAAP) of $19.7 million, or $0.96
diluted EPS
- Record quarter of insurance revenues reflects unique
diversification helping deliver record quarterly noninterest
income
- Strong asset quality performance with decline in nonperforming
loans and substandard loans, minimal net charge-offs, and past dues
down to less than $10 million
- Implemented efficiency improvements and early retirement
initiative to deliver annual cost savings of $2.2 million
- Announced the acquisition of Blackhawk Bancorp, Inc. continuing
the Company’s diversification strategy and enhancing funding and
liquidity profile
- Board of Directors declared regular quarterly dividend of $0.23
per share
“Our unique income diversification helped deliver a solid start
to the year,” said Joe Dively, Chairman and Chief Executive
Officer. “It was clearly an eventful quarter as we continued our
strategic initiatives and managed through the increased challenges
in our industry. Financially, the quarter was highlighted by a
record quarter in our insurance business, continued strength in our
asset quality, and an efficiency initiative that will lower
expenses by approximately $2.2 million per year.”
“In addition, after a long history of working together on
various customer opportunities and strategic considerations, we
announced the merger with Blackhawk Bancorp, Inc. The cultural
alignment of the two organizations will make for a smooth
integration and help us to maintain the strong customer
relationships and commitments to communities Blackhawk has
delivered for many years. We are planning to hit the ground running
with our broader array of services that customers and employees can
be excited about,” Dively concluded.
Net Interest Income
Net interest income for the first quarter of 2023 decreased by
$2.5 million, or 5.4% compared to the fourth quarter of 2022.
Interest income increased by $3.0 million and interest expense
increased by $5.4 million. The increase in interest income was
primarily driven by a higher average rate on earning assets.
Accretion income decreased by $0.2 million in the period to $0.4
million and ended the quarter with a remaining discount of $6.5
million. The increase in interest expense was primarily driven by
higher interest rates and increased competition for funding.
In comparison to the first quarter of 2022, net interest income
decreased $0.3 million, or 0.8%. The decrease was primarily the
result of funding costs increasing at a faster pace than organic
earning asset growth and repricing.
Net Interest Margin
Net interest margin, on a tax equivalent basis, was 2.94% for
the first quarter of 2023, which was 13 basis points lower compared
to the prior quarter. Earning asset yields increased 25 basis
points, while the average cost of funds increased 38 basis
points.
In comparison to the first quarter of last year, the net
interest margin decreased 13 basis points, with earning asset
yields higher by 99 basis points and average cost of funds higher
by 112 basis points.
Loan Portfolio
Total loans ended the quarter at $4.76 billion, representing a
decrease of $65.6 million compared to the prior quarter. The
decrease was primarily due to elevated payoffs in commercial real
estate from customer asset sales and the seasonal nature of
agriculture operating loans. In addition, line of credit draws
decreased by $34.0 million in the quarter, which was driven by
higher rates and strong customer balance sheets. The loan pipeline
still has solid opportunities, but customers are expressing some
caution due to continued economic uncertainty, and we expect growth
to moderate from prior periods.
Asset Quality
The Company has strength in its long-standing and disciplined
credit culture, which allows it to remain consistent in
underwriting regardless of the economic cycle. Asset quality
metrics for March 31, 2023 reflect those efforts. The allowance for
credit losses at the end of the quarter was flat from the prior
period at 1.22% of total loans. Also at quarter end, the ratio of
non-performing loans to total loans was down to 0.32%, and the
allowance for credit losses to non-performing loans was 384%. The
ratio of nonperforming assets to total assets was down to 0.29% at
quarter end. Nonperforming loans and nonperforming assets both
decreased in the period. The Company recognized minimal net
charge-offs during the first quarter.
Provision expense was recorded as a credit of $0.8 million in
the first quarter. The credit was primarily driven by the decline
in loan balances, decline in substandard loans, and a decline in
past dues, partially offset by an increase in qualitative factors
for the growing uncertainty on the macro-economic conditions. The
allowance totaled $58.2 million at the end of the quarter, which
represents significantly more than the $37.2 million of total
cumulative net charge-offs the Company has experienced over the
last 20 years.
Deposits
Total deposits ended the quarter at $5.03 billion, which
represented a decrease of $226.2 million from the prior quarter.
Noninterest-bearing deposits increased by $5.7 million in the
quarter. A majority of the overall deposit decline in the period
was attributable to one customer. As previously mentioned, the
Company received approximately $225 million of deposits in the
third quarter of last year related to a customer’s sale of certain
assets. These funds were known to be temporary deposits on the
Company’s balance sheet as they would be deployed for capital and
operating needs of the customer. Most of this outflow occurred
during the period with approximately $50 million of the balance
remaining as of March 31, 2023. The Company has no other large
customer deposit concentrations similar to this one. The Company
has not lost a customer related to the industry’s deposit security
concerns subsequent to the bank failures in March. Approximately
99% of the Company’s deposit accounts are less than $250,000. The
average account balance for all deposit customers is approximately
$25,000. The percentage of deposits that were uninsured at quarter
end was 25.9%.
Outside of the previously mentioned customer, deposit flows
throughout the quarter were relatively similar to prior periods
where rate competition was a key determinant to the migration. Late
in the first quarter, the Company saw an increase in the
competitive landscape resulting in higher matching and promotional
rates to normalize deposit flows. In addition, deposit security
became a more common discussion topic, and the Company met customer
needs and maintained deposit relationships by moving approximately
$93 million of deposits into the Intrafi Network for the FDIC
insurance coverage.
Noninterest Income
Noninterest income for the first quarter of 2023 was $22.5
million compared to $18.2 million in the fourth quarter of 2022.
The increase compared to the prior quarter was primarily due to
both organic and seasonal growth within the insurance business and
approximately $0.7 million in a bank owned life insurance claim.
Insurance and wealth management revenues represented 62% of total
noninterest income reflecting the diversification of our revenue
sources. Noninterest income represented approximately 34.2% of
total revenue in the period.
In comparison to the first quarter of 2022, noninterest income
increased $1.4 million, or 6.6%. The year-over-year increase was
driven by strong growth in our insurance business of $1.4 million
and a bank owned life insurance claim of $0.7 million, partially
offset by lower wealth management and mortgage income.
Noninterest Expenses
Noninterest expense for the first quarter of 2023 totaled $41.6
million compared to $39.4 million in the fourth quarter. The
increase was primarily driven by $0.7 million of nonrecurring
acquisition and severance related costs and higher producer
incentive-based compensation tied to the record high insurance
revenue. During the quarter, the Company implemented an efficiency
initiative. This project resulted in nonrecurring severance costs
of $0.5 million recorded in the period and will result in
approximately $2.2 million of ongoing annual savings.
In comparison to the first quarter of 2022, noninterest expenses
increased $1.2 million. The increase was primarily due to a full
quarter of expenses from the Jefferson acquisition, higher
incentive-based compensation tied to insurance revenues, and
overall inflationary pressures.
The Company’s efficiency ratio, as adjusted in the non-GAAP
reconciliation table herein, for the first quarter 2023 was 59.0%
compared to 58.1% in the prior quarter and 58.6% for the same
period last year.
Capital Levels and Dividend
The Company’s capital levels remained strong and comfortably
above the “well capitalized” levels. Capital levels ended the
period as follows:
Total capital
to risk-weighted assets |
15.74% |
Tier 1 capital to risk-weighted assets |
12.88% |
Common equity tier 1 capital to risk-weighted assets |
12.51% |
Leverage ratio |
9.89% |
|
|
The Company’s Board of Directors approved a regular quarterly
dividend in the amount of $0.23 payable on June 1, 2023 for
shareholders of record on May 17, 2023.
About First Mid: First Mid Bancshares, Inc.
(“First Mid”) is the parent company of First Mid Bank & Trust,
N.A., First Mid Insurance Group, Inc. and First Mid Wealth
Management Co. First Mid is a $6.7 billion community-focused
organization that provides a full-suite of financial services
including banking, wealth management, brokerage, Ag services, and
insurance through a sizeable network of locations throughout
Illinois, Missouri and Texas, and a loan production office in the
greater Indianapolis area. Together, the First Mid team takes great
pride in their work and their ability to serve customers well over
the last 158 years. More information about the Company is available
on our website at www.firstmid.com
Non-GAAP Measures: In addition to reports
presented in accordance with generally accepted accounting
principles (“GAAP”), this release contains certain non-GAAP
financial measures. The Company believes that such non-GAAP
financial measures provide investors with information useful in
understanding the Company’s financial performance. Readers of this
release, however, are urged to review these non-GAAP financial
measures in conjunction with the GAAP results as reported. These
non-GAAP financial measures are detailed as supplemental tables and
include “Adjusted Net Income,” “Adjusted Diluted EPS,” “Efficiency
Ratio,” “Net Interest Margin, tax equivalent,” and “Tangible Book
Value per Common Share”. While the Company believes these non-GAAP
financial measures provide investors with a broader understanding
of the capital adequacy, funding profile and financial trends of
the Company, this information should be considered as supplemental
in nature and not as a substitute to the related financial
information prepared in accordance with GAAP. These non-GAAP
financial measures may also differ from the similar measures
presented by other companies.
Forward Looking Statements This
document may contain certain forward-looking statements about First
Mid and Blackhawk, such as discussions of First Mid’s and
Blackhawk’s pricing and fee trends, credit quality and outlook,
liquidity, new business results, expansion plans, anticipated
expenses and planned schedules. First Mid 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. Forward-looking
statements, which are based on certain assumptions and describe
future plans, strategies and expectations of First Mid and
Blackhawk, are identified by use of the words “believe,” “expect,”
“intend,” “anticipate,” “estimate,” “project,” or similar
expressions. Actual results could differ materially from the
results indicated by these statements because the realization of
those results is subject to many risks and uncertainties,
including, among other things, the possibility that any of the
anticipated benefits of the proposed transactions between First Mid
and Blackhawk will not be realized or will not be realized within
the expected time period; the risk that integration of the
operations of Blackhawk with First Mid will be materially delayed
or will be more costly or difficult than expected; the inability to
complete the proposed transactions due to the failure to satisfy
conditions to completion of the proposed transactions, including
failure to obtain the required regulatory, shareholder and other
approvals; the failure of the proposed transactions to close for
any other reason; the effect of the announcement of the proposed
transactions on customer relationships and operating results; the
possibility that the proposed transactions may be more expensive to
complete than anticipated, including as a result of unexpected
factors or events; changes in interest rates; general economic
conditions and those in the market areas of First Mid and
Blackhawk; legislative and/or regulatory changes; monetary and
fiscal policies of the U.S. Government, including policies of the
U.S. Treasury and the Federal Reserve Board; the quality or
composition of First Mid’s and Blackhawk’s loan or investment
portfolios and the valuation of those investment portfolios; demand
for loan products; deposit flows; competition, demand for financial
services in the market areas of First Mid and Blackhawk; accounting
principles, policies and guidelines; and the impact of the global
COVID-19 pandemic on First Mid’s or Blackhawk’s businesses, the
ability to complete the proposed transactions or any of the other
foregoing risks. Additional information concerning First Mid,
including additional factors and risks that could materially affect
First Mid’s financial results, are included in First Mid’s filings
with the SEC, including its Annual Reports on Form 10-K and
Quarterly Reports on Form 10-Q. Forward-looking statements speak
only as of the date they are made. Except as required under the
federal securities laws or the rules and regulations of the SEC, we
do not undertake any obligation to update or review any
forward-looking information, whether as a result of new
information, future events or otherwise.
Important Information about the Merger
and Additional InformationFirst Mid will file a
registration statement on Form S-4 with the SEC in connection with
the proposed transaction. The registration statement will include a
proxy statement of Blackhawk that also constitutes a prospectus of
First Mid, which will be sent to the shareholders of Blackhawk.
Investors in Blackhawk are urged to read the proxy
statement/prospectus, which will contain important information,
including detailed risk factors, when it becomes
available. The proxy statement/prospectus and other
documents which will be filed by First Mid with the SEC will be
available free of charge at the SEC’s website, www.sec.gov. These
documents also can be obtained free of charge by accessing First
Mid’s website at www.firstmid.com under the tab “Investors
Relations” and then under “SEC Filings.” Alternatively, when
available, these documents can be obtained free of charge from
First Mid upon written requestto First Mid Bancshares,
P.O. Box 499, Mattoon, IL 61938, Attention: Investor
Relations; or from Blackhawk upon written request to Blackhawk
Bancorp, Inc., 400 Broad Street, Beloit, WI 53511, Attention: Todd
J. James, President & CEO. A final proxy statement/prospectus
will be mailed to the shareholders of Blackhawk.
Participants in the
SolicitationFirst Mid and Blackhawk, and certain of their
respective directors, executive officers and other members of
management and employees, are participants in the solicitation of
proxies in connection with the proposed transactions.
Information about the directors and executive officers of
First Mid is set forth in the proxy statement for its 2023 annual
meeting of stockholders, which was filed with the SEC on March 15,
2023. These documents can be obtained free of charge from
the sources provided above. Investors may obtain additional
information regarding the interests of such participants in the
proposed transactions by reading the proxy statement/prospectus for
such proposed transactions when it becomes available.
No Offer or SolicitationThis
communication shall not constitute an offer to sell or the
solicitation of an offer to buy securities, nor shall there be any
sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction.
Investor Contact: Aaron HoltVP, Shareholder
Relations217-258-0463 aholt@firstmid.com
Matt SmithChief Financial
Officer217-258-1528msmith@firstmid.com
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FIRST MID
BANCSHARES, INC. |
|
|
Condensed
Consolidated Balance Sheets |
|
|
(In thousands,
unaudited) |
|
|
As of |
|
|
|
|
March
31, |
|
December
31, |
|
March
31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
Cash and
cash equivalents |
$ |
169,134 |
|
|
$ |
152,433 |
|
|
$ |
223,980 |
|
|
Investment
securities |
|
1,217,754 |
|
|
|
1,223,720 |
|
|
|
1,472,277 |
|
|
Loans
(including loans held for sale) |
|
4,760,631 |
|
|
|
4,826,212 |
|
|
|
4,454,561 |
|
|
Less
allowance for credit losses |
|
(58,223 |
) |
|
|
(59,093 |
) |
|
|
(58,474 |
) |
|
Net
loans |
|
4,702,408 |
|
|
|
4,767,119 |
|
|
|
4,396,087 |
|
|
Premises and
equipment, net |
|
90,178 |
|
|
|
90,473 |
|
|
|
89,319 |
|
|
Goodwill and
intangibles, net |
|
168,373 |
|
|
|
169,897 |
|
|
|
174,499 |
|
|
Bank owned
life insurance |
|
151,366 |
|
|
|
151,756 |
|
|
|
149,041 |
|
|
Other
assets |
|
183,637 |
|
|
|
188,817 |
|
|
|
126,803 |
|
|
Total assets |
$ |
6,682,850 |
|
|
$ |
6,744,215 |
|
|
$ |
6,632,006 |
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
Non-interest
bearing |
$ |
1,262,181 |
|
|
$ |
1,256,514 |
|
|
$ |
1,373,881 |
|
|
Interest
bearing |
|
3,768,597 |
|
|
|
4,000,487 |
|
|
|
4,113,424 |
|
|
Total
deposits |
|
5,030,778 |
|
|
|
5,257,001 |
|
|
|
5,487,305 |
|
|
Repurchase
agreement with customers |
|
228,664 |
|
|
|
221,414 |
|
|
|
187,326 |
|
|
Other
borrowings |
|
595,021 |
|
|
|
465,071 |
|
|
|
126,396 |
|
|
Junior
subordinated debentures |
|
19,406 |
|
|
|
19,364 |
|
|
|
19,237 |
|
|
Subordinated
debt |
|
94,593 |
|
|
|
94,553 |
|
|
|
94,438 |
|
|
Other
liabilities |
|
52,523 |
|
|
|
53,657 |
|
|
|
50,919 |
|
|
Total liabilities |
|
6,020,985 |
|
|
|
6,111,060 |
|
|
|
5,965,621 |
|
|
|
|
|
|
|
|
|
Total stockholders' equity |
|
661,865 |
|
|
|
633,155 |
|
|
|
666,385 |
|
|
Total
liabilities and stockholders' equity |
$ |
6,682,850 |
|
|
$ |
6,744,215 |
|
|
$ |
6,632,006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FIRST MID
BANCSHARES, INC. |
Condensed
Consolidated Statements of Income |
(In thousands,
except per share data, unaudited) |
|
|
|
|
|
|
Three Months
Ended |
|
|
March
31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
Interest income: |
|
|
|
|
Interest and
fees on loans |
$ |
56,236 |
|
|
$ |
39,908 |
|
|
Interest on
investment securities |
|
7,127 |
|
|
|
7,170 |
|
|
Interest on
federal funds sold & other deposits |
|
308 |
|
|
|
67 |
|
|
Total interest income |
|
63,671 |
|
|
|
47,145 |
|
|
Interest expense: |
|
|
|
|
Interest on
deposits |
|
12,767 |
|
|
|
2,148 |
|
|
Interest on
securities sold under agreements to repurchase |
|
1,463 |
|
|
|
67 |
|
|
Interest on
other borrowings |
|
4,883 |
|
|
|
276 |
|
|
Interest on
jr. subordinated debentures |
|
379 |
|
|
|
146 |
|
|
Interest on
subordinated debt |
|
988 |
|
|
|
986 |
|
|
Total interest expense |
|
20,480 |
|
|
|
3,623 |
|
|
Net
interest income |
|
43,191 |
|
|
|
43,522 |
|
|
Provision
for credit losses |
|
(817 |
) |
|
|
2,952 |
|
|
Net
interest income after provision for loan |
|
44,008 |
|
|
|
40,570 |
|
|
Non-interest income: |
|
|
|
|
Wealth
management revenues |
|
5,514 |
|
|
|
5,975 |
|
|
Insurance
commissions |
|
8,480 |
|
|
|
7,104 |
|
|
Service
charges |
|
2,203 |
|
|
|
2,056 |
|
|
Net
securities gains/(losses) |
|
(46 |
) |
|
|
0 |
|
|
Mortgage
banking revenues |
|
150 |
|
|
|
444 |
|
|
ATM/debit
card revenue |
|
3,083 |
|
|
|
2,898 |
|
|
Other |
|
3,095 |
|
|
|
2,611 |
|
|
Total
non-interest income |
|
22,479 |
|
|
|
21,088 |
|
|
Non-interest expense: |
|
|
|
|
Salaries and
employee benefits |
|
26,071 |
|
|
|
24,302 |
|
|
Net
occupancy and equipment expense |
|
6,005 |
|
|
|
6,155 |
|
|
Net other
real estate owned (income) expense |
|
133 |
|
|
|
(33 |
) |
|
FDIC
insurance |
|
463 |
|
|
|
426 |
|
|
Amortization
of intangible assets |
|
1,522 |
|
|
|
1,522 |
|
|
Stationary
and supplies |
|
292 |
|
|
|
311 |
|
|
Legal and
professional expense |
|
1,690 |
|
|
|
1,734 |
|
|
ATM/debit
card expense |
|
1,223 |
|
|
|
1,078 |
|
|
Marketing
and donations |
|
654 |
|
|
|
873 |
|
|
Other |
|
3,524 |
|
|
|
4,020 |
|
|
Total
non-interest expense |
|
41,577 |
|
|
|
40,388 |
|
|
Income
before income taxes |
|
24,910 |
|
|
|
21,270 |
|
|
Income
taxes |
|
5,730 |
|
|
|
4,654 |
|
|
Net
income |
$ |
19,180 |
|
|
$ |
16,616 |
|
|
|
|
|
|
|
Per
Share Information |
|
|
|
|
Basic
earnings per common share |
$ |
0.94 |
|
|
$ |
0.86 |
|
|
Diluted
earnings per common share |
|
0.93 |
|
|
|
0.86 |
|
|
|
|
|
|
|
Weighted
average shares outstanding |
|
20,492,254 |
|
|
|
19,295,860 |
|
|
Diluted
weighted average shares outstanding |
|
20,563,972 |
|
|
|
19,358,457 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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FIRST MID BANCSHARES, INC. |
Condensed Consolidated Statements of Income |
(In thousands, except per share data, unaudited) |
|
|
|
|
|
|
|
|
|
|
|
For the Quarter Ended |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2022 |
|
|
2022 |
|
|
2022 |
|
Interest income: |
|
|
|
|
|
|
|
|
|
Interest and fees on loans |
$ |
56,236 |
|
|
$ |
53,128 |
|
|
$ |
49,278 |
|
$ |
43,555 |
|
$ |
39,908 |
|
Interest on investment securities |
|
7,127 |
|
|
|
7,285 |
|
|
|
7,302 |
|
|
7,623 |
|
|
7,170 |
|
Interest on federal funds sold & other deposits |
|
308 |
|
|
|
296 |
|
|
|
174 |
|
|
105 |
|
|
67 |
|
Total interest income |
|
63,671 |
|
|
|
60,709 |
|
|
|
56,754 |
|
|
51,283 |
|
|
47,145 |
|
Interest expense: |
|
|
|
|
|
|
|
|
|
Interest on deposits |
|
12,767 |
|
|
|
9,227 |
|
|
|
4,915 |
|
|
2,523 |
|
|
2,148 |
|
Interest on securities sold under agreements to repurchase |
|
1,463 |
|
|
|
1,163 |
|
|
|
428 |
|
|
137 |
|
|
67 |
|
Interest on other borrowings |
|
4,883 |
|
|
|
3,345 |
|
|
|
1,927 |
|
|
645 |
|
|
276 |
|
Interest on jr. subordinated debentures |
|
379 |
|
|
|
315 |
|
|
|
241 |
|
|
166 |
|
|
146 |
|
Interest on subordinated debt |
|
988 |
|
|
|
987 |
|
|
|
986 |
|
|
986 |
|
|
986 |
|
Total interest expense |
|
20,480 |
|
|
|
15,037 |
|
|
|
8,497 |
|
|
4,457 |
|
|
3,623 |
|
Net interest income |
|
43,191 |
|
|
|
45,672 |
|
|
|
48,257 |
|
|
46,826 |
|
|
43,522 |
|
Provision for credit losses |
|
(817 |
) |
|
|
805 |
|
|
|
142 |
|
|
907 |
|
|
2,952 |
|
Net interest income after provision for loan |
|
44,008 |
|
|
|
44,867 |
|
|
|
48,115 |
|
|
45,919 |
|
|
40,570 |
|
Non-interest income: |
|
|
|
|
|
|
|
|
|
Wealth management revenues |
|
5,514 |
|
|
|
6,201 |
|
|
|
4,843 |
|
|
5,473 |
|
|
5,975 |
|
Insurance commissions |
|
8,480 |
|
|
|
4,719 |
|
|
|
4,158 |
|
|
5,641 |
|
|
7,104 |
|
Service charges |
|
2,203 |
|
|
|
2,375 |
|
|
|
2,445 |
|
|
2,236 |
|
|
2,056 |
|
Securities gains, net |
|
(46 |
) |
|
|
(48 |
) |
|
|
79 |
|
|
2 |
|
|
- |
|
Mortgage banking revenues |
|
150 |
|
|
|
65 |
|
|
|
355 |
|
|
289 |
|
|
444 |
|
ATM/debit card revenue |
|
3,083 |
|
|
|
3,209 |
|
|
|
3,101 |
|
|
3,214 |
|
|
2,898 |
|
Other |
|
3,095 |
|
|
|
1,686 |
|
|
|
1,810 |
|
|
1,704 |
|
|
2,611 |
|
Total non-interest income |
|
22,479 |
|
|
|
18,207 |
|
|
|
16,791 |
|
|
18,559 |
|
|
21,088 |
|
Non-interest expense: |
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
26,071 |
|
|
|
23,610 |
|
|
|
24,877 |
|
|
25,768 |
|
|
24,302 |
|
Net occupancy and equipment expense |
|
6,005 |
|
|
|
6,126 |
|
|
|
5,903 |
|
|
6,073 |
|
|
6,155 |
|
Net other real estate owned (income) expense |
|
133 |
|
|
|
87 |
|
|
|
58 |
|
|
218 |
|
|
(33 |
) |
FDIC insurance |
|
463 |
|
|
|
464 |
|
|
|
479 |
|
|
436 |
|
|
426 |
|
Amortization of intangible assets |
|
1,522 |
|
|
|
1,537 |
|
|
|
1,598 |
|
|
1,633 |
|
|
1,522 |
|
Stationary and supplies |
|
292 |
|
|
|
298 |
|
|
|
361 |
|
|
325 |
|
|
311 |
|
Legal and professional expense |
|
1,690 |
|
|
|
1,607 |
|
|
|
1,770 |
|
|
1,885 |
|
|
1,734 |
|
ATM/debit card expense |
|
1,223 |
|
|
|
1,309 |
|
|
|
1,243 |
|
|
670 |
|
|
1,078 |
|
Marketing and donations |
|
654 |
|
|
|
681 |
|
|
|
739 |
|
|
706 |
|
|
873 |
|
Other |
|
3,524 |
|
|
|
3,653 |
|
|
|
4,521 |
|
|
3,801 |
|
|
4,020 |
|
Total non-interest expense |
|
41,577 |
|
|
|
39,372 |
|
|
|
41,549 |
|
|
41,515 |
|
|
40,388 |
|
Income before income taxes |
|
24,910 |
|
|
|
23,702 |
|
|
|
23,357 |
|
|
22,963 |
|
|
21,270 |
|
Income taxes |
|
5,730 |
|
|
|
3,063 |
|
|
|
5,418 |
|
|
5,205 |
|
|
4,654 |
|
Net income |
$ |
19,180 |
|
|
$ |
20,639 |
|
|
$ |
17,939 |
|
$ |
17,758 |
|
$ |
16,616 |
|
|
|
|
|
|
|
|
|
|
|
Per Share Information |
|
|
|
|
|
|
|
|
|
Basic earnings per common share |
$ |
0.94 |
|
|
$ |
1.01 |
|
|
$ |
0.88 |
|
$ |
0.87 |
|
$ |
0.86 |
|
Diluted earnings per common share |
|
0.93 |
|
|
|
1.01 |
|
|
|
0.88 |
|
|
0.86 |
|
|
0.86 |
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding |
|
20,492,254 |
|
|
|
20,461,046 |
|
|
|
20,454,669 |
|
|
20,448,799 |
|
|
19,295,860 |
|
Diluted weighted average shares outstanding |
|
20,563,972 |
|
|
|
20,535,220 |
|
|
|
20,535,215 |
|
|
20,529,523 |
|
|
19,358,457 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FIRST MID
BANCSHARES, INC. |
|
|
|
|
|
|
Consolidated
Financial Highlights and Ratios |
|
|
|
|
|
|
(Dollars in
thousands, except per share data) |
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
As of and for the Quarter Ended |
|
March
31, |
|
December
31, |
|
September
30, |
June
30, |
|
March
31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2022 |
|
|
|
2022 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
|
Loan Portfolio |
|
|
|
|
|
|
|
|
|
Construction
and land development |
$ |
159,157 |
|
|
$ |
144,264 |
|
|
$ |
142,801 |
|
|
$ |
141,072 |
|
|
$ |
131,504 |
|
Farm real
estate loans |
|
401,957 |
|
|
|
410,327 |
|
|
|
360,424 |
|
|
|
350,159 |
|
|
|
280,993 |
|
1-4 Family
residential properties |
|
424,545 |
|
|
|
440,180 |
|
|
|
436,625 |
|
|
|
424,230 |
|
|
|
417,232 |
|
Multifamily
residential properties |
|
301,808 |
|
|
|
294,346 |
|
|
|
298,321 |
|
|
|
330,600 |
|
|
|
369,926 |
|
Commercial
real estate |
|
2,003,647 |
|
|
|
2,030,011 |
|
|
|
1,996,338 |
|
|
|
1,976,654 |
|
|
|
1,965,321 |
|
Loans secured by real estate |
|
3,291,114 |
|
|
|
3,319,128 |
|
|
|
3,234,509 |
|
|
|
3,222,715 |
|
|
|
3,164,976 |
|
Agricultural
operating loans |
|
146,847 |
|
|
|
166,838 |
|
|
|
160,511 |
|
|
|
142,406 |
|
|
|
121,708 |
|
Commercial
and industrial loans |
|
1,078,021 |
|
|
|
1,082,960 |
|
|
|
1,064,033 |
|
|
|
1,036,987 |
|
|
|
935,454 |
|
Consumer
loans |
|
88,430 |
|
|
|
97,775 |
|
|
|
100,783 |
|
|
|
94,828 |
|
|
|
89,685 |
|
All other
loans |
|
156,219 |
|
|
|
159,511 |
|
|
|
160,454 |
|
|
|
151,727 |
|
|
|
142,738 |
|
Total loans |
|
4,760,631 |
|
|
|
4,826,212 |
|
|
|
4,720,290 |
|
|
|
4,648,663 |
|
|
|
4,454,561 |
|
|
|
|
|
|
|
|
|
|
|
Deposit Portfolio |
|
|
|
|
|
|
|
|
|
Non-interest
bearing demand deposits |
$ |
1,262,181 |
|
|
$ |
1,256,514 |
|
|
$ |
1,334,686 |
|
|
$ |
1,369,756 |
|
|
$ |
1,373,881 |
|
Interest
bearing demand deposits |
|
1,419,791 |
|
|
|
1,389,283 |
|
|
|
1,364,306 |
|
|
|
1,453,932 |
|
|
|
1,482,556 |
|
Savings
deposits |
|
639,691 |
|
|
|
636,699 |
|
|
|
657,592 |
|
|
|
683,944 |
|
|
|
685,228 |
|
Money
Market |
|
878,452 |
|
|
|
1,267,726 |
|
|
|
1,443,060 |
|
|
|
1,158,724 |
|
|
|
1,280,129 |
|
Time
deposits |
|
830,663 |
|
|
|
706,779 |
|
|
|
683,554 |
|
|
|
652,622 |
|
|
|
665,511 |
|
Total deposits |
|
5,030,778 |
|
|
|
5,257,001 |
|
|
|
5,483,198 |
|
|
|
5,318,978 |
|
|
|
5,487,305 |
|
|
|
|
|
|
|
|
|
|
|
Asset Quality |
|
|
|
|
|
|
|
|
|
Non-performing loans |
$ |
15,163 |
|
|
$ |
19,170 |
|
|
$ |
20,812 |
|
|
$ |
19,981 |
|
|
$ |
22,465 |
|
Non-performing assets |
|
19,225 |
|
|
|
23,539 |
|
|
|
25,143 |
|
|
|
24,190 |
|
|
|
27,269 |
|
Net
charge-offs (recoveries) |
|
53 |
|
|
|
489 |
|
|
|
440 |
|
|
|
307 |
|
|
|
(5 |
) |
Allowance
for credit losses to non-performing loans |
|
383.98 |
% |
|
|
308.26 |
% |
|
|
282.42 |
% |
|
|
295.66 |
% |
|
|
260.29 |
% |
Allowance
for credit losses to total loans outstanding |
|
1.22 |
% |
|
|
1.22 |
% |
|
|
1.25 |
% |
|
|
1.27 |
% |
|
|
1.31 |
% |
Nonperforming loans to total loans |
|
0.32 |
% |
|
|
0.40 |
% |
|
|
0.44 |
% |
|
|
0.43 |
% |
|
|
0.50 |
% |
Nonperforming assets to total assets |
|
0.29 |
% |
|
|
0.35 |
% |
|
|
0.38 |
% |
|
|
0.36 |
% |
|
|
0.41 |
% |
Special
Mention loans |
|
47,022 |
|
|
|
39,853 |
|
|
|
25,298 |
|
|
|
35,849 |
|
|
|
64,160 |
|
Substandard
and Doubtful loans |
|
29,931 |
|
|
|
34,352 |
|
|
|
37,378 |
|
|
|
38,155 |
|
|
|
38,801 |
|
|
|
|
|
|
|
|
|
|
|
Common Share Data |
|
|
|
|
|
|
|
|
|
Common
shares outstanding |
|
20,519,717 |
|
|
|
20,452,376 |
|
|
|
20,454,636 |
|
|
|
20,448,799 |
|
|
|
20,437,183 |
|
Book value
per common share |
$ |
32.26 |
|
|
$ |
30.96 |
|
|
$ |
29.37 |
|
|
$ |
30.63 |
|
|
$ |
32.61 |
|
Tangible
book value per common share (2) |
|
24.05 |
|
|
|
22.65 |
|
|
|
21.01 |
|
|
|
22.17 |
|
|
|
24.07 |
|
Market price
of stock |
|
27.22 |
|
|
|
32.08 |
|
|
|
31.97 |
|
|
|
35.67 |
|
|
|
38.49 |
|
|
|
|
|
|
|
|
|
|
|
Key Performance Ratios and Metrics |
|
|
|
|
|
|
|
|
|
End of
period earning assets |
$ |
5,995,674 |
|
|
$ |
6,063,953 |
|
|
$ |
5,975,619 |
|
|
$ |
6,024,815 |
|
|
$ |
6,038,542 |
|
Average
earning assets |
|
6,052,264 |
|
|
|
6,000,106 |
|
|
|
6,063,061 |
|
|
|
5,975,821 |
|
|
|
5,817,752 |
|
Average rate
on average earning assets (tax equivalent) |
|
4.32 |
% |
|
|
4.07 |
% |
|
|
3.77 |
% |
|
|
3.50 |
% |
|
|
3.33 |
% |
Average rate
on cost of funds |
|
1.38 |
% |
|
|
1.00 |
% |
|
|
0.56 |
% |
|
|
0.30 |
% |
|
|
0.26 |
% |
Net interest
margin (tax equivalent) (2) |
|
2.94 |
% |
|
|
3.07 |
% |
|
|
3.21 |
% |
|
|
3.20 |
% |
|
|
3.07 |
% |
Return on
average assets |
|
1.15 |
% |
|
|
1.24 |
% |
|
|
1.07 |
% |
|
|
1.08 |
% |
|
|
1.05 |
% |
Return on
average common equity |
|
12.11 |
% |
|
|
13.51 |
% |
|
|
11.18 |
% |
|
|
11.02 |
% |
|
|
9.95 |
% |
Efficiency
ratio (tax equivalent) (2) |
|
59.01 |
% |
|
|
58.07 |
% |
|
|
59.64 |
% |
|
|
58.45 |
% |
|
|
58.59 |
% |
Full-time
equivalent employees |
|
988 |
|
|
|
1,043 |
|
|
|
1,051 |
|
|
|
1,025 |
|
|
|
1,050 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Excludes Paycheck Protection Loans |
|
|
|
|
|
|
|
|
2 Non-GAAP financial
measure. Refer to reconciliation to the comparable GAAP
measure. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FIRST MID
BANCSHARES, INC. |
Net Interest
Margin |
(In thousands,
unaudited) |
|
For the Quarter Ended March 31, 2023 |
|
QTD Average |
|
|
|
Average |
|
Balance |
|
Interest |
|
Rate |
INTEREST
EARNING ASSETS |
|
|
|
|
|
Interest bearing deposits |
$ |
15,688 |
|
|
$ |
209 |
|
5.40 |
% |
Federal
funds sold |
|
7,753 |
|
|
|
85 |
|
4.45 |
% |
Certificates
of deposits investments |
|
1,789 |
|
|
|
14 |
|
3.17 |
% |
Investment
Securities: |
|
|
|
|
|
Taxable (total less municipals) |
|
957,951 |
|
|
|
5,163 |
|
2.16 |
% |
Tax-exempt (Municipals) |
|
280,828 |
|
|
|
2,486 |
|
3.54 |
% |
Loans (net
of unearned income) |
|
4,788,255 |
|
|
|
56,469 |
|
4.78 |
% |
|
|
|
|
|
|
Total
interest earning assets |
|
6,052,264 |
|
|
|
64,426 |
|
4.32 |
% |
|
|
|
|
|
|
NONEARNING
ASSETS |
|
|
|
|
|
Cash and due
from banks |
|
135,145 |
|
|
|
|
|
Premises and
equipment |
|
90,345 |
|
|
|
|
|
Other
nonearning assets |
|
475,022 |
|
|
|
|
|
Allowance
for loan losses |
|
(59,558 |
) |
|
|
|
|
|
|
|
|
|
|
Total
assets |
$ |
6,693,218 |
|
|
|
|
|
|
|
|
|
|
|
INTEREST
BEARING LIABILITIES |
|
|
|
|
|
Demand
deposits |
$ |
2,504,073 |
|
|
$ |
9,655 |
|
1.56 |
% |
Savings
deposits |
|
640,347 |
|
|
|
191 |
|
0.12 |
% |
Time
deposits |
|
699,328 |
|
|
|
2,921 |
|
1.69 |
% |
Total
interest bearing deposits |
|
3,843,748 |
|
|
|
12,767 |
|
1.35 |
% |
Repurchase
agreements |
|
231,012 |
|
|
|
1,463 |
|
2.57 |
% |
FHLB
advances |
|
540,156 |
|
|
|
4,874 |
|
3.66 |
% |
Federal
funds purchased |
|
778 |
|
|
|
9 |
|
4.69 |
% |
Subordinated
debt |
|
94,567 |
|
|
|
987 |
|
4.23 |
% |
Jr.
subordinated debentures |
|
19,385 |
|
|
|
379 |
|
7.93 |
% |
Other
debt |
|
- |
|
|
|
- |
|
0.00 |
% |
Total
borrowings |
|
885,898 |
|
|
|
7,712 |
|
3.53 |
% |
Total
interest bearing liabilities |
|
4,729,646 |
|
|
|
20,479 |
|
1.76 |
% |
|
|
|
|
|
|
NONINTEREST
BEARING LIABILITIES |
|
|
|
|
|
Demand
deposits |
|
1,273,527 |
|
|
Average cost of funds |
1.38 |
% |
Other
liabilities |
|
56,456 |
|
|
|
|
|
Stockholders' equity |
|
633,589 |
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities & stockholders' equity |
$ |
6,693,218 |
|
|
|
|
|
|
|
|
|
|
|
Net Interest
Earnings / Spread |
|
|
$ |
43,947 |
|
2.56 |
% |
|
|
|
|
|
|
Impact of
Non-Interest Bearing Funds |
|
|
|
|
0.38 |
% |
|
|
|
|
|
|
Tax effected yield on interest earning assets |
|
|
|
2.94 |
% |
|
|
|
|
|
|
FIRST MID
BANCSHARES, INC. |
Reconciliation of Non-GAAP Financial Measures |
(In thousands,
unaudited) |
|
|
|
|
|
|
|
|
|
|
|
As of and for the Quarter Ended |
|
March
31, |
|
December
31, |
|
September
30, |
June
30, |
|
March
31, |
|
2023 |
|
2022 |
|
2022 |
|
2022 |
|
2022 |
|
|
|
|
|
|
|
|
|
|
Net interest income as reported |
$ |
43,191 |
|
|
$ |
45,672 |
|
|
$ |
48,257 |
|
|
$ |
46,826 |
|
|
$ |
43,522 |
|
Net interest
income, (tax equivalent) |
|
43,947 |
|
|
|
46,464 |
|
|
|
49,060 |
|
|
|
47,625 |
|
|
|
44,292 |
|
Average
earning assets |
|
6,052,264 |
|
|
|
6,000,106 |
|
|
|
6,063,061 |
|
|
|
5,975,821 |
|
|
|
5,817,752 |
|
Net interest
margin (tax equivalent) |
|
2.94 |
% |
|
|
3.07 |
% |
|
|
3.21 |
% |
|
|
3.20 |
% |
|
|
3.07 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stockholder's equity |
$ |
661,865 |
|
|
$ |
633,155 |
|
|
$ |
600,715 |
|
|
$ |
626,268 |
|
|
$ |
666,385 |
|
Goodwill and
intangibles, net |
|
168,373 |
|
|
|
169,897 |
|
|
|
170,897 |
|
|
|
172,871 |
|
|
|
174,499 |
|
Common
shares outstanding |
|
20,520 |
|
|
|
20,452 |
|
|
|
20,455 |
|
|
|
20,449 |
|
|
|
20,437 |
|
Tangible
Book Value per common share |
$ |
24.05 |
|
|
$ |
22.65 |
|
|
$ |
21.01 |
|
|
$ |
22.17 |
|
|
$ |
24.07 |
|
|
|
|
|
|
|
|
|
|
|
FIRST MID BANCSHARES, INC. |
Reconciliation of Non-GAAP Financial Measures |
(In thousands, except per share data, unaudited) |
|
|
|
|
|
|
|
|
|
|
|
As of and for the Quarter Ended |
|
March 31, |
|
December 31, |
|
September 30, |
June 30, |
|
March 31, |
|
2022 |
|
2022 |
|
2022 |
|
2022 |
|
2022 |
Adjusted earnings Reconciliation |
|
|
|
|
|
|
|
|
|
Net Income - GAAP |
$ |
19,180 |
|
|
$ |
20,639 |
|
|
$ |
17,939 |
|
|
$ |
17,758 |
|
|
$ |
16,616 |
|
Adjustments (post-tax): (1) |
|
|
|
|
|
|
|
|
|
Acquisition ACL on non-PCD assets in provision expense |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,580 |
|
Nonrecurring severance expense |
|
416 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Integration and acquisition expenses |
|
135 |
|
|
|
131 |
|
|
|
524 |
|
|
|
777 |
|
|
|
469 |
|
Total non-recurring adjustments (non-GAAP) |
$ |
551 |
|
|
$ |
131 |
|
|
$ |
524 |
|
|
$ |
777 |
|
|
$ |
2,049 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings - non-GAAP |
$ |
19,731 |
|
|
$ |
20,770 |
|
|
$ |
18,463 |
|
|
$ |
18,535 |
|
|
$ |
18,665 |
|
Adjusted diluted earnings per share (non-GAAP) |
$ |
0.96 |
|
|
$ |
1.01 |
|
|
$ |
0.90 |
|
|
$ |
0.90 |
|
|
$ |
0.96 |
|
|
|
|
|
|
|
|
|
|
|
Efficiency Ratio Reconciliation |
|
|
|
|
|
|
|
|
|
Noninterest expense - GAAP |
$ |
41,577 |
|
|
$ |
39,372 |
|
|
$ |
41,549 |
|
|
$ |
41,515 |
|
|
$ |
40,388 |
|
Other real estate owned property income (expense) |
|
(133 |
) |
|
|
(87 |
) |
|
|
(58 |
) |
|
|
(218 |
) |
|
|
33 |
|
Amortization of intangibles |
|
(1,522 |
) |
|
|
(1,537 |
) |
|
|
(1,598 |
) |
|
|
(1,633 |
) |
|
|
(1,522 |
) |
Nonrecurring severance expense |
|
(527 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Integration and acquisition expenses |
|
(171 |
) |
|
|
(166 |
) |
|
|
(663 |
) |
|
|
(983 |
) |
|
|
(594 |
) |
Adjusted noninterest expense (non-GAAP) |
$ |
39,224 |
|
|
$ |
37,582 |
|
|
$ |
39,230 |
|
|
$ |
38,681 |
|
|
$ |
38,305 |
|
|
|
|
|
|
|
|
|
|
|
Net interest income -GAAP |
$ |
43,192 |
|
|
$ |
45,672 |
|
|
$ |
48,257 |
|
|
$ |
46,826 |
|
|
$ |
43,522 |
|
Effect of tax-exempt income (1) |
|
755 |
|
|
|
792 |
|
|
|
803 |
|
|
|
799 |
|
|
|
770 |
|
Adjusted net interest income (non-GAAP) |
$ |
43,947 |
|
|
$ |
46,464 |
|
|
$ |
49,060 |
|
|
$ |
47,625 |
|
|
$ |
44,292 |
|
|
|
|
|
|
|
|
|
|
|
Noninterest income - GAAP |
$ |
22,479 |
|
|
$ |
18,207 |
|
|
$ |
16,791 |
|
|
$ |
18,559 |
|
|
$ |
21,088 |
|
Net (gain)/loss on securities sales |
|
46 |
|
|
|
48 |
|
|
|
(79 |
) |
|
|
(2 |
) |
|
|
- |
|
Adjusted noninterest income (non-GAAP) |
$ |
22,525 |
|
|
$ |
18,255 |
|
|
$ |
16,712 |
|
|
$ |
18,557 |
|
|
$ |
21,088 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted total revenue (non-GAAP) |
$ |
66,472 |
|
|
$ |
64,719 |
|
|
$ |
65,772 |
|
|
$ |
66,182 |
|
|
$ |
65,380 |
|
|
|
|
|
|
|
|
|
|
|
Efficiency ratio (non-GAAP) |
|
59.01 |
% |
|
|
58.07 |
% |
|
|
59.64 |
% |
|
|
58.45 |
% |
|
|
58.59 |
% |
|
|
|
|
|
|
|
|
|
|
(1) Nonrecurring items (post-tax) and tax-exempt income are
calculated using an estimated effective tax rate of 21%. |
|
|
|
|
|
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