Our net interest margin decreased from 4.53% for the nine-month period ended
September 30, 2017 to 4.46% for the nine-month period ended September 30, 2018. The yield on loans was 5.95% and 5.70% for the nine months ended September 30, 2018 and 2017, respectively, as average loans increased from
$7.79 billion to $10.53 billion. The increase in loan balances is primarily due to the acquisitions we completed during 2017. For the nine months ended September 30, 2018 and 2017, we recognized $32.0 million and
$23.3 million, respectively, in total net accretion for acquired loans and deposits. The rate on interest-bearing deposits increased from 0.49% for the nine months ended September 30, 2017, to 0.91% for the nine months ended
September 30, 2018, with average balances of $5.73 billion and $8.02 billion, respectively.
Our efficiency ratio was
37.26% for the nine months ended September 30, 2018, compared to 43.92% for the same period in 2017. For the first nine months of 2018, our efficiency ratio, as adjusted
(non-GAAP),
was 37.46%, which
decreased from the 37.79% reported for first nine months of 2017. (See Table 23 for the
non-GAAP
tabular reconciliation). Even though acquisitions tend to increase our efficiency ratio in the short
term, we had a slight improvement in the efficiency ratio, as adjusted, as a result of cost savings from our Stonegate acquisition being realized soon after conversion, which was completed on February 9, 2018.
Our annualized return on average assets was 2.12% for the nine months ended September 30, 2018, compared to 1.41% for the same period in
2017. Excluding merger expenses and hurricane expenses, our annualized return on average assets was 2.12% for the nine months ended September 30, 2018 compared to 1.82% for the same period in 2017 (See Table 20 for the
non-GAAP
tabular reconciliation). Our annualized return on average common equity was 13.56% for the nine months ended September 30, 2018, compared to 10.33% for the same period in 2017. Excluding merger
expenses and hurricane expenses, our annualized return on average common equity was 13.56% for the nine months ended September 30, 2018 compared to 13.36% for the same period in 2017 (See Table 21 for the
non-GAAP
tabular reconciliation). Excluding the $38.0 million tax effect of the TCJA, our annualized return on average assets was 1.77% for the nine months ended September 30, 2018 (See Table 20 for
the
non-GAAP
tabular reconciliation) and our annualized return on average common equity was 11.32% (See Table 21 for the
non-GAAP
tabular reconciliation).
Financial Condition as of and for the Period Ended September 30, 2018 and December 31, 2017
Our total assets as of September 30, 2018 increased $463.0 million to $14.91 billion from the $14.45 billion reported as of
December 31, 2017. Our loan portfolio increased $501.6 million or 4.86% for the quarter ended September 30, 2018 from $10.33 billion as of December 31, 2017 to $10.83 billion as of September 30, 2018. The increase
is primarily due to the acquisition of $376.2 million of loans as part of the acquisition of Shore Premier Finance (SPF) as well as $125.4 million of organic loan growth the nine months ended September 30, 2018. Total
deposits increased $236.2 million to $10.62 billion as of September 30, 2018 from $10.39 billion as of December 31, 2017. Stockholders equity increased $136.7 million to $2.34 billion as of September 30,
2018, compared to $2.20 billion as of December 31, 2017. The increase in stockholders equity is primarily associated with the $171.2 million increase in retained earnings, the issuance of 1,250,000 shares of stock with a value
of $28.2 million as part of the acquisition of SPF, and the issuance of $6.5 million of share-based compensation, which were partially offset by $27.3 million of comprehensive loss and the repurchase of $43.2 million of our
common stock during 2018.
As of September 30, 2018, our
non-performing
loans increased to
$56.5 million, or 0.52%, of total loans from $44.7 million, or 0.43%, of total loans as of December 31, 2017. The allowance for loan losses as a percent of
non-performing
loans decreased to
195.15% as of September 30, 2018, from 246.70% as of December 31, 2017.
Non-performing
loans from our Arkansas franchise were $14.5 million at September 30, 2018 compared to
$15.5 million as of December 31, 2017.
Non-performing
loans from our Florida franchise were $40.0 million at September 30, 2018 compared to $28.2 million as of December 31, 2017.
Non-performing
loans from our Alabama franchise were $133,000 at September 30, 2018 compared to $929,000 as of December 31, 2017.
Non-performing
loans from our SPF
franchise were $1.8 million, and there were no
non-performing
loans from our Centennial CFG franchise as of September 30, 2018 or December 31, 2017.
As of September 30, 2018, our
non-performing
assets increased to $70.4 million, or 0.47% of
total assets from $63.6 million, or 0.44%, of total assets as of December 31, 2017.
Non-performing
assets from our Arkansas franchise were $21.1 million at September 30, 2018 compared to
$25.6 million as of December 31, 2017.
Non-performing
assets from our Florida franchise were $46.7 million at September 30, 2018 compared to $36.4 million as of December 31, 2017.
Non-performing
assets from our Alabama franchise were $774,000 at September 30, 2018 compared to $1.6 million as of December 31, 2017.
Non-performing
assets from our SPF franchise were $1.8 million, and there were no
non-performing
assets from our Centennial CFG franchise as of September 30, 2018 or December 31, 2017.
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