HomeTrust Bancshares, Inc. (NASDAQ: HTBI) ("Company"), the holding
company of HomeTrust Bank ("Bank"), today announced preliminary net
income for the third quarter of fiscal 2020, approval of its
quarterly cash dividend, and its response to the COVID-19 pandemic.
For the quarter ended March 31, 2020 compared to
the corresponding quarter in the previous year:
- net income was $1.2 million, compared to $3.3 million;
- diluted earnings per share ("EPS") was $0.07, compared to
$0.18;
- return on assets ("ROA") was 0.14%, compared to 0.39%;
- return on equity ("ROE") was 1.15%, compared to 3.24%;
- provision for loan losses was $5.4 million, compared to $5.5
million;
- noninterest income increased $1.0 million, or 18.1% to $6.4
million from $5.4 million;
- organic net loan growth, which excludes one-to-four family
loans transferred to held for sale and purchases of home equity
lines of credit, was $33.6 million, or 5.5% annualized compared to
$38.5 million, or 6.2% annualized;
- 635,800 shares were repurchased during the quarter at an
average price of $20.45 per share completing the most recent
buyback program; and
- quarterly cash dividends continued at $0.07 per share totaling
$1.2 million.
For the nine months ended March 31, 2020
compared to the corresponding period in the previous year:
- net income was $19.2 million, compared to $19.1 million;
- EPS was $1.08, compared to $1.02;
- ROA was 0.72%, compared to 0.76%;
- ROE was 6.19%, compared to 6.21%;
- provision for loan losses was $5.8 million, compared to $5.5
million;
- noninterest income increased $7.0 million, or 43.6% to $23.1
million from $16.1 million;
- total deposits increased $246.4 million, or 10.7% to $2.6
billion from $2.3 billion; and
- 1,032,221 shares of common stock were repurchased during the
period at an average price of $22.50 per share.
Earnings during the three and nine months ended
March 31, 2020 were negatively impacted by a significant increase
in the provision for loan losses based on the Company's initial
assessment of COVID-19 on various macroeconomic factors. In
addition, earnings for the nine months ended March 31, 2020
included a $958,000 after-tax gain from the sale of $154.9 million
in one-to-four family loans in December 2019.
The Company also announced today that its Board
of Directors declared a quarterly cash dividend of $0.07 per common
share payable on June 4, 2020 to shareholders of record as of the
close of business on May 21, 2020.
"We could not be more proud of our team members
for their courage, dedication and focus on taking care of our
customers' needs during these unprecedented times. Their health and
safety as well as the health and safety of our customers and
communities is our primary concern," said Dana Stonestreet,
Chairman, President, and Chief Executive Officer. "We understand
that everyone is facing their own set of challenges relating to
COVID-19 and we remain committed to helping our customers navigate
through whatever financial challenges they may face. At the onset
of the pandemic, we announced multiple relief programs for both
individual and business customers, including payment deferrals,
waiving late fees, suspension of foreclosures and repossessions,
providing access to government sponsored lending programs as well
as various other tailored solutions. Our retail banking team has
proactively reached out to many of our customers by phone while
continuing to service them through our branch office drive-thrus,
in our lobbies by appointment, and online. All of these activities
have taken place just a few short weeks after our very successful
core systems technology conversion in late February."
Response to COVID-19
Loan Programs. In response to the current
global situation surrounding the COVID-19 pandemic, the Company is
offering a variety of relief options designed to support our
customers and communities, including participating in the U.S.
Small Business Administration’s (“SBA”) Paycheck Protection Program
(“PPP”). As of April 24, 2020, we had received PPP applications
totaling $89.0 million with confirmed allocation from the SBA for
243 applications totaling $76.9 million. Net origination fees on
these loans are approximately $1.9 million which will be deferred
and amortized into interest income as the loans are repaid or
forgiven. Due to demand exceeding our capacity, on April 9, 2020 we
partnered with a third party to process and fund additional PPP
applications for our customers and communities. With the recent
approval by Congress of additional funds for this program,
applications will continue to be processed through our third party
relationship. We are also working with our clients to assist them
with accessing other borrowing options, including the Main Street
Lending Program and other government sponsored lending programs, as
appropriate.
Loan Modifications. The Company is closely
monitoring the effects of COVID-19 on our loan portfolio and will
continue to monitor all the associated risks to minimize any
potential losses. HomeTrust Bank is offering payment and financial
relief programs for borrowers impacted by COVID-19. These programs
include loan payment deferrals for up to 90 days, waived late fees,
and suspension of foreclosure proceedings and repossessions. We
have received numerous requests from borrowers for some type of
payment relief. As of April 24, 2020, we have processed and
approved payment deferrals on loans totaling $510.4 million, or
19.2% of total loans. The breakout by loan type is as follows:
Payment Deferrals by Loan
Types |
|
|
|
|
(dollars in thousands) |
|
|
|
|
|
|
Outstanding Loan Balance |
|
Percent of Total Loan Portfolio |
Commercial real estate, construction and development, and
commercial and industrial |
|
$ |
412,525 |
|
|
15.5 |
% |
Equipment finance |
|
38,975 |
|
|
1.5 |
% |
One-to-four family |
|
47,062 |
|
|
1.8 |
% |
Other consumer loans |
|
11,876 |
|
|
0.4 |
% |
Total |
|
$ |
510,438 |
|
|
19.2 |
% |
We believe the steps we are taking are necessary
to effectively manage our portfolio and assist our customers
through the ongoing uncertainty surrounding the duration, impact
and government response to the COVID-19 pandemic.
Allowance for Loan Losses. The Company recorded
a provision for loan losses of $5.4 million for the third quarter
of 2020, compared to a $400,000 provision in the preceding quarter
and $5.5 million in the third quarter a year ago, which was related
to one commercial customer relationship. The provision for the
current quarter reflects expected credit losses based upon the
conditions that existed as of March 31, 2020 including
consideration for the recent downturn in certain leading economic
indicators, such as the weaker stock market, lower manufacturing
activity and retail sales, consumer confidence, and increases in
unemployment. Specifically, the Company’s management has evaluated
its loan portfolio and identified the following loan categories as
potentially the most impacted by the COVID-19 pandemic:
Loan Segments (as of March 31,
2020) |
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
Loan Risk Grade |
|
|
|
|
|
|
Pass(1) |
|
Criticized(2) |
|
Outstanding Loan Balance |
|
Percent of Total Loan Portfolio |
Lodging |
|
$ |
108,864 |
|
|
$ |
2,069 |
|
|
$ |
110,933 |
|
|
4.2 |
% |
Restaurants |
|
47,780 |
|
|
71 |
|
|
47,851 |
|
|
1.8 |
% |
Shopping centers |
|
76,723 |
|
|
1,441 |
|
|
78,164 |
|
|
2.9 |
% |
Other retail businesses |
|
130,341 |
|
|
295 |
|
|
130,635 |
|
|
4.9 |
% |
Equipment finance |
|
197,651 |
|
|
1,311 |
|
|
198,862 |
|
|
7.5 |
% |
Total |
|
$ |
561,359 |
|
|
$ |
5,187 |
|
|
$ |
566,445 |
|
|
21.3 |
% |
Percent of total |
|
99.1 |
% |
|
0.9 |
% |
|
100.0 |
% |
|
— |
(1) A pass rated loan is not adversely
classified because it does not display any of the characteristics
for adverse classification.
(2) Includes loans that are graded special
mention or substandard. These loans have weaknesses (or potential
weaknesses) that may result in deterioration of the repayment
prospects or collateral position at some future date.
The Company does not have any exposure to
oil/gas or credit cards at March 31, 2020.
Branch Operations and Support Personnel.
We have taken various steps to ensure the safety of our customers
and our team members by limiting branch activities to appointment
only and use of our drive-up facilities, and by encouraging the use
of our digital and electronic banking channels, all the while
adjusting for evolving State and Federal guidelines. Many of our
employees are working remotely or have flexible work schedules, and
we have established protective measures within our offices to help
ensure the safety of those employees who must work on-site.
Capital. At March 31, 2020, the Company’s
tangible equity to total tangible assets ratio was 10.76% and
HomeTrust Bank’s capital was well in excess of all regulatory
requirements. Our strong capital level positions us well in the
face of the challenges of the COVID-19 pandemic. As part of the
Company’s risk management process, we have maintained strong
capital ratios in the latter part of the longest economic recovery
in U.S. history.
Income Statement Review
Net interest income decreased to $25.3 million
for the quarter ended March 31, 2020, compared to $26.6 million for
the comparative quarter in fiscal 2019. The $1.3 million, or 4.7%
decrease was due to a $1.7 million decrease in interest and
dividend income primarily driven by lower rates on loans and
commercial paper as a result of lower federal funds and other
market interest rates, which was partially offset by a $417,000
decrease in interest expense. Average interest-earning assets
increased $65.7 million, or 2.1% to $3.2 billion for the quarter
ended March 31, 2020. The average balance of total loans
receivable increased by $19.6 million, or 0.7% compared to the same
quarter last year due to organic loan growth offset by the
previously disclosed one-to-four family loans sold in December
2019. The average balance of commercial paper and deposits in other
banks increased $40.8 million, or 12.1% between the periods driven
by increases in commercial paper investments. Our investments in
commercial paper have short-term maturities and limited exposure of
$15.0 million or less per each highly-rated company. The average
balance in securities available for sale increased $14.2 million,
or 10.2%, which was primarily driven by the purchase of
shorter-term corporate bonds. These increases were partially funded
by a cumulative $52.9 million, or 1.8% increase in average
interest-bearing liabilities and noninterest bearing deposits and
the $8.9 million, or 19.0% decrease in other interest earning
assets as compared to the same quarter last year. Net interest
margin (on a fully taxable-equivalent basis) for the three months
ended March 31, 2020 decreased to 3.16% from 3.39% for the same
period a year ago.
Total interest and dividend income decreased
$1.7 million, or 4.8% for the three months ended March 31, 2020 as
compared to the same period last year, which was primarily driven
by a $1.0 million, or 3.2% decrease in loan interest income, a
$489,000, or 21.4% decrease in interest income from commercial
paper and deposits in other banks, and a $261,000, or 32.2%
decrease in other investment income which was partially offset by a
$62,000, or 7.3% increase in interest income from securities
available for sale. The lower interest income from loans and
commercial paper and deposits in other banks was primarily driven
by the decrease in yields. Average loan yields decreased 18 basis
points to 4.51% for the quarter ended March 31, 2020 from 4.69% in
the corresponding quarter last year. For the quarters ended March
31, 2020 and 2019, average loan yields included six and seven basis
points, respectively, from the accretion of purchase discounts on
acquired loans. The incremental accretion and the impact to the
yield on loans may change during any period based on the volume of
prepayments, but it is expected to decrease over time as the
balance of the purchase discount for acquired loans decreases. The
total purchase discount for acquired loans was $5.5 million at
March 31, 2020, compared to $6.7 million at June 30, 2019, and $7.1
million at March 31, 2019.
Total interest expense decreased $417,000, or
5.1% for the quarter ended March 31, 2020 compared to the same
period last year. The decrease was driven by a $2.0 million, or
53.0% decrease in interest expense on borrowings partially offset
by a $1.6 million, or 35.6% increase in interest expense on
deposits. The additional deposit interest expense was a result of
our continued focus on increasing deposits as the average balance
of interest-bearing deposits increased $205.3 million, or 10.4%
along with a 20 basis point increase in the average cost of
interest-bearing deposits for the quarter ended March 31, 2020
compared to the same quarter last year. Average borrowings for the
quarter ended March 31, 2020 decreased $196.8 million, or 29.4%
along with a 75 basis point decrease in the average cost of
borrowings compared to the same period last year. The decrease in
the average cost of borrowing was driven by the lower federal funds
rate during the current quarter compared to the prior year. The
overall average cost of funds decreased seven basis points to 1.16%
for the current quarter compared to 1.23% in the same quarter last
year due primarily to the impact of the lower amount of borrowings
and rates.
Net interest income decreased slightly to $79.4
million for the nine months ended March 31, 2020, compared to $79.9
million for the comparative period in fiscal 2019. The $526,000, or
0.7% decrease was due to a $3.8 million increase in interest and
dividend income primarily driven by an increase in average
interest-earning assets, which was offset by a $4.3 million
increase in interest expense. Average interest-earning assets
increased $166.8 million, or 5.3% to $3.3 billion for the nine
months ended March 31, 2020 compared to $3.1 billion for the
corresponding period in fiscal 2019. For the nine months ended
March 31, 2020, the average balance of total loans receivable
increased $125.8 million, or 4.8% compared to the same period last
year primarily due to organic loan growth. The average balance of
commercial paper and deposits in other banks increased $38.6
million, or 11.9% between the periods driven by increases in
commercial paper investments. These increases were primarily funded
by the $151.5 million, or 5.9% increase in average interest-bearing
liabilities, as compared to the same nine month period last year.
Net interest margin (on a fully taxable-equivalent basis) for the
nine months ended March 31, 2020 decreased to 3.25% from 3.45% for
the same period a year ago.
Total interest and dividend income increased
$3.8 million, or 3.7% for the nine months ended March 31, 2020 as
compared to the same period last year, which was primarily driven
by a $4.1 million, or 4.6% increase in loan interest income, and a
$319,000, or 12.4% increase in interest income from securities
available for sale, which was partially offset by a $147,000, or
2.4% decrease in interest income from commercial paper and
interest-bearing deposits and a $510,000, or 19.1% decrease in
other investment income. The additional loan interest income was
driven by the increase in the average balance of loans receivable
compared to the prior year. Average loan yields decreased slightly
by two basis points to 4.63% for the nine months ended March
31, 2020 from 4.65% in the corresponding period last year. For the
nine months ended March 31, 2020 and 2019, average loan yields
included six and eight basis points, respectively, from the
accretion of purchase discounts on acquired loans.
Total interest expense increased $4.3 million,
or 20.1% for the nine months ended March 31, 2020 compared to
the same period last year. The increase was driven by a $7.4
million, or 68.6% increase in deposit interest expense partially
offset by a $3.1 million, or 28.7% decrease in interest expense on
borrowings. The additional deposit interest expense was a result of
a $226.9 million, or 11.8% increase in the average balance of
interest-bearing deposits along with a 37 basis point increase in
the average cost of those deposits for the nine months ended March
31, 2020 as compared to the same period last year. Average
borrowings for the nine months ended March 31, 2020 decreased $75.3
million, or 11.4% along with a 42 basis point decrease in the
average cost of borrowings compared to the same period last year.
The overall cost of funds increased 14 basis points to 1.25% for
the nine months ended March 31, 2020 compared to 1.11% in the
corresponding period last year.
Noninterest income increased $1.0 million, or
18.1% to $6.4 million for the three months ended March 31, 2020
from $5.4 million for the same period in the previous year
primarily due a $160,000, 119.4% increase in loan income and fees
and a $749,000, or 74.4% increase in other noninterest income. The
$160,000 increase for the quarter in loan income and fees is
primarily a result of our adjustable rate conversion program and
prepayment fees on equipment finance loans. The $749,000 increase
in other noninterest income primarily related to operating lease
income from the new equipment finance line of business. There were
$32.2 million of residential mortgage loans originated for sale
which were sold with gains of $852,000 compared to $24.7 million
sold and gains of $628,000 in the corresponding quarter in the
prior year. During the quarter ended March 31, 2020, $6.8 million
of the guaranteed portion of SBA commercial loans were sold with
gains of $469,000 compared to $11.5 million sold and gains of
$843,000 in the corresponding quarter in the prior year. In
addition, $18.0 million of home equity loans were sold during the
quarter for a gain of $183,000.
Noninterest income increased $7.0 million, or
43.6% to $23.1 million for the nine months ended March 31, 2020
from $16.1 million for the same period in the previous year
primarily due to a $3.5 million, or 85.4% increase in the gain on
sale of loans held for sale, a $1.3 million, or 170.4% increase in
loan income and fees, and a $2.0 million, or 81.1% increase in
other noninterest income. The increase in the gain on sale of loans
held for sale was a result of the previously discussed one-to-four
family loans sold during the period which resulted in a
non-recurring $1.3 million gain. In addition to this non-recurring
gain, $135.4 million of residential mortgage loans sold with gains
of $3.6 million for the nine months ended March 31, 2020, compared
to $81.3 million sold and gains of $2.0 million in the
corresponding period in the prior year. During the nine months
ended March 31, 2020, $36.0 million of SBA commercial loans were
sold with recorded gains of $2.5 million compared to $28.7 million
sold and gains of $2.0 million in the corresponding period in the
prior year. The increase in loan income and fees is primarily a
result of our adjustable rate conversion program and prepayment
fees on equipment finance loans. The $2.0 million increase in other
noninterest income primarily related to operating lease income from
the equipment finance line of business.
Noninterest expense for the three months ended
March 31, 2020 increased $1.9 million, or 8.4% to $24.9 million
compared to $23.0 million for the three months ended March 31,
2019. The increase was primarily due to a $1.0 million, or 7.4%
increase in salaries and employee benefits as a result of new
positions and annual salary increases; a $1.0 million, or 34.6%
increase in other expenses, mainly driven by depreciation from our
equipment finance line of business and expenses related to our
recent core system conversion; a $164,000, or 23.5% increase in
telephone, postage, and supplies as a result of our core
conversion; and a $142,000, or 44.4% increase in deposit insurance
premiums as a result of our growth and changing loan portfolio mix.
Partially offsetting these increases was a cumulative decrease of
$365,000, or 39.1% in real estate owned ("REO") related expenses
and core deposit intangible amortization for the three months ended
March 31, 2020 compared to the same period last year.
Noninterest expense for the nine months ended
March 31, 2020 increased $5.8 million, or 8.6% to $72.5 million
compared to $66.7 million for the nine months ended March 31, 2019.
The increase was primarily due to a $3.5 million, or 9.1% increase
in salaries and employee benefits; a $2.4 million, or 30.3%
increase in other expenses, mainly driven by depreciation from our
equipment finance line of business and expenses related to our core
conversion; a $497,000, or 40.8% increase in marketing and
advertising expense; a $308,000, or 5.4% increase in computer
services; and a $252,000, or 11.4% increase in telephone, postage,
and supplies. Partially offsetting these increases was a decrease
of $485,000, or 50.6% in deposit insurance premiums related to
credit from the Federal Deposit Insurance Corporation in the first
and second quarter; a $462,000, or 29.2% decrease in core deposit
intangible amortization; and a $214,000, or 20.4% decrease in REO
related expenses for the nine months ended March 31, 2020 compared
to the same period last year.
For the three months ended March 31, 2020, the
Company's income tax expense increased $3,000, or 1.6% to $188,000
from $185,000. The effective tax rate for the three months ended
March 31, 2020 and 2019 was 13.6% and 5.3%, respectively. These
lower rates were due to the effects of $1.0 million in each quarter
of tax-free income from municipal leases in the Company's loan
portfolio.
For the nine months ended March 31, 2020, the
Company's income tax expense increased $376,000, or 8.0% to $5.1
million from $4.7 million for the corresponding period in the
previous year as a result of higher taxable income. The effective
tax rate for the nine months ended March 31, 2020 and 2019 was
20.9% and 19.7%, respectively.
Balance Sheet Review
Total assets and liabilities remained relatively
level at $3.5 billion and $3.1 billion, respectively, at March 31,
2020 compared to June 30, 2019. The funds received from the $154.9
million in one-to-four family loans sold and deposit growth of
$227.5 million, or 9.8% were used to pay down $145.0 million, or
21.3% of borrowings, fund the $114.4 million, or 22.7% net increase
in cash and cash equivalents, commercial paper, certificates of
deposit in other banks, securities available for sale, and loans
held for sale for the first nine months of fiscal 2020.
Approximately $85.6 million one-to-four family loans being marketed
for sale at December 31, 2019 were moved from loans held for sale
and back into the loan portfolio during the current quarter as
market conditions changed management's intent to sell these loans.
The increase in loans held for sale relates to home equity loans
originated for sale during the period. Deferred income taxes
decreased $4.8 million, or 18.0% to $21.8 million at March 31, 2020
from $26.5 million at June 30, 2019 due to the use of net operating
loss carryforwards.
As of July 1, 2019, the Company adopted the new
lease accounting standard, which drove several changes on the
balance sheet. Land totaling $2.1 million related to the Company's
one finance lease (f/k/a capital lease) was reclassed from premises
and equipment, net to other assets as a right of use ("ROU") asset
and the corresponding liability was reclassed from a separate line
on the balance sheet to other liabilities as a lease liability. As
of March 31, 2020, the Company has $4.6 million in ROU assets and
corresponding lease liabilities, which are maintained in other
assets and other liabilities, respectively.
Stockholders' equity at March 31, 2020 decreased
$3.5 million, or 0.8% to $405.4 million compared to $408.9 million
at June 30, 2019. Changes within stockholders' equity included
$19.2 million in net income and $2.3 million in stock-based
compensation, offset by 1,032,221 shares of common stock
repurchased at an average cost of $22.50, or approximately $23.2
million in total, and $3.4 million related to cash dividends
declared. As of March 31, 2020, HomeTrust Bank and the Company were
considered "well capitalized" in accordance with their regulatory
capital guidelines and exceeded all regulatory capital
requirements.
Asset Quality
The allowance for loan losses was $26.9 million,
or 1.01% of total loans, at March 31, 2020 compared to $21.4
million, or 0.79% of total loans, at June 30, 2019. The allowance
for loan losses to total gross loans excluding acquired loans was
1.07% at March 31, 2020, compared to 0.85% at June 30, 2019. The
overall increase was primarily driven by additional allowance
stemming from the initial assessment of COVID-19 on the loan
portfolio.
There was a $5.8 million provision for loan
losses for the nine months ended March 31, 2020, compared to
$5.5 million for the corresponding period in fiscal year
2019. The current year provision included significant adjustments
relating to COVID-19 as a result of changes in qualitative factors
based on our perceived increase in at risk loan sub-categories,
which include: lodging, restaurants, shopping centers, other
retail, and equipment finance. The provision in the corresponding
period in the prior year related to one commercial loan
relationship. Net loan charge offs totaled $379,000 for the nine
months ended March 31, 2020, compared to $2.1 million for the same
period in fiscal year 2019. Net charge offs as a percentage of
average loans were 0.02% and 0.11% for the nine months ended March
31, 2020 and 2019, respectively.
Nonperforming assets increased by $3.4 million,
or 20.6% to $16.7 million, or 0.47% of total assets, at March 31,
2020 compared to $13.3 million, or 0.38% of total assets at June
30, 2019. Nonperforming assets included $15.6 million in
nonaccruing loans and $1.1 million in REO at March 31, 2020,
compared to $10.4 million and $2.9 million, in nonaccruing loans
and REO, respectively, at June 30, 2019. The increase in
nonaccruing loans primarily relates to one commercial real estate
loan relationship that was moved to nonaccrual during the second
quarter. Included in nonperforming loans are $7.2 million of loans
restructured from their original terms of which $5.8 million were
current at March 31, 2020, with respect to their modified payment
terms. Purchased impaired loans aggregating $1.0 million obtained
through prior acquisitions are excluded from nonaccruing loans due
to the accretion of discounts established in accordance with the
acquisition method of accounting for business combinations.
Nonperforming loans to total loans was 0.59% at March 31, 2020 and
0.38% at June 30, 2019.
The ratio of classified assets to total assets
decreased to 0.86% at March 31, 2020 from 0.89% at June 30, 2019.
Classified assets decreased to $30.7 million at March 31, 2020
compared to $30.9 million at June 30, 2019. Our overall asset
quality metrics continue to demonstrate our commitment to growing
and maintaining a loan portfolio with a moderate risk profile,
however we will remain diligent in our review of the portfolio and
overall economy as we continue to maneuver through the uncertainty
surrounding COVID-19.
About HomeTrust Bancshares,
Inc.
HomeTrust Bancshares, Inc. is the holding
company for HomeTrust Bank. As of March 31, 2020, the Company had
assets of $3.5 billion. The Bank, founded in 1926, is a North
Carolina state chartered, community-focused financial institution
committed to providing value added relationship banking with over
40 locations as well as online/mobile channels. Locations include:
North Carolina (including the Asheville metropolitan area, the
"Piedmont" region, Charlotte, and Raleigh/Cary), Upstate South
Carolina (Greenville), East Tennessee (including Kingsport/Johnson
City/Bristol, Knoxville, and Morristown) and Southwest Virginia
(including the Roanoke Valley). The Bank is the 2nd largest
community bank headquartered in North Carolina.
Forward-Looking Statements
This press release includes "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995. Such statements often include words such as
"believe," "expect," "anticipate," "estimate," and "intend" or
future or conditional verbs such as "will," "would," "should,"
"could," or "may." Forward-looking statements are not historical
facts but instead represent management's current expectations and
forecasts regarding future events, many of which are inherently
uncertain and outside of our control. Actual results may differ,
possibly materially, from those currently expected or projected in
these forward-looking statements. Factors that could cause our
actual results to differ materially from those described in the
forward-looking statements include: the effect of the COVID-19
pandemic, including on our credit quality and business operations,
as well as its impact on general economic and financial market
conditions and other uncertainties resulting from the COVID-19
pandemic, such as the extent and duration of the impact on public
health, the U.S. and global economies, and consumer and corporate
customers, including economic activity, employment levels and
market liquidity; increased competitive pressures; changes in the
interest rate environment; changes in general economic conditions
and conditions within the securities markets; legislative and
regulatory changes; and other factors described in HomeTrust's
latest annual Report on Form 10-K and Quarterly Reports on Form
10-Q and other documents filed with or furnished to the Securities
and Exchange Commission - which are available on our website at
www.htb.com and on the SEC's website at www.sec.gov. Any of
the forward-looking statements that we make in this press release
or the documents we file with or furnish to the SEC are based upon
management's beliefs and assumptions at the time they are made and
may turn out to be wrong because of inaccurate assumptions we might
make, because of the factors described above or because of other
factors that we cannot foresee. We do not undertake and
specifically disclaim any obligation to revise any forward-looking
statements to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such
statements. These risks could cause our actual results for fiscal
2020 and beyond to differ materially from those expressed in any
forward-looking statements by, or on behalf of, us and could
negatively affect our operating and stock performance.
WEBSITE:
WWW.HOMETRUSTBANCSHARES.COMContact:Dana
L. Stonestreet – Chairman, President and Chief Executive
OfficerTony J. VunCannon – Executive Vice President, Chief
Financial Officer, Corporate Secretary and
Treasurer828-259-3939
Consolidated Balance Sheets (Unaudited)
(Dollars in thousands) |
March 31, 2020 |
|
December 31, 2019 |
|
September 30, 2019 |
|
June 30, 2019(1) |
|
March 31, 2019 |
Assets |
|
|
|
|
|
|
|
|
|
Cash |
$ |
41,206 |
|
|
$ |
47,213 |
|
|
$ |
52,082 |
|
|
$ |
40,909 |
|
|
$ |
40,633 |
|
Interest-bearing deposits |
40,855 |
|
|
41,705 |
|
|
65,011 |
|
|
30,134 |
|
|
37,678 |
|
Cash and cash equivalents |
82,061 |
|
|
88,918 |
|
|
117,093 |
|
|
71,043 |
|
|
78,311 |
|
Commercial paper |
281,955 |
|
|
253,794 |
|
|
254,302 |
|
|
241,446 |
|
|
246,903 |
|
Certificates of deposit in
other banks |
57,544 |
|
|
47,628 |
|
|
50,117 |
|
|
52,005 |
|
|
56,209 |
|
Securities available for sale,
at fair value |
158,621 |
|
|
146,022 |
|
|
165,714 |
|
|
121,786 |
|
|
139,112 |
|
Other investments, at
cost |
41,201 |
|
|
36,898 |
|
|
45,900 |
|
|
45,378 |
|
|
51,122 |
|
Loans held for sale |
38,682 |
|
|
118,055 |
|
|
289,319 |
|
|
18,175 |
|
|
14,745 |
|
Total loans, net of deferred
loan fees |
2,663,524 |
|
|
2,554,541 |
|
|
2,508,730 |
|
|
2,705,190 |
|
|
2,660,647 |
|
Allowance for loan losses |
(26,850 |
) |
|
(22,031 |
) |
|
(21,314 |
) |
|
(21,429 |
) |
|
(24,416 |
) |
Net loans |
2,636,674 |
|
|
2,532,510 |
|
|
2,487,416 |
|
|
2,683,761 |
|
|
2,636,231 |
|
Premises and equipment,
net |
58,738 |
|
|
58,020 |
|
|
58,509 |
|
|
61,051 |
|
|
60,559 |
|
Accrued interest
receivable |
9,501 |
|
|
9,714 |
|
|
10,434 |
|
|
10,533 |
|
|
10,885 |
|
Real estate owned ("REO") |
1,075 |
|
|
1,451 |
|
|
2,582 |
|
|
2,929 |
|
|
3,003 |
|
Deferred income taxes |
21,750 |
|
|
22,066 |
|
|
24,257 |
|
|
26,523 |
|
|
28,832 |
|
Bank owned life insurance
("BOLI") |
91,612 |
|
|
91,048 |
|
|
90,499 |
|
|
90,254 |
|
|
89,663 |
|
Goodwill |
25,638 |
|
|
25,638 |
|
|
25,638 |
|
|
25,638 |
|
|
25,638 |
|
Core deposit intangibles |
1,381 |
|
|
1,715 |
|
|
2,088 |
|
|
2,499 |
|
|
2,948 |
|
Other assets |
41,600 |
|
|
36,755 |
|
|
31,441 |
|
|
23,157 |
|
|
13,576 |
|
Total Assets |
$ |
3,548,033 |
|
|
$ |
3,470,232 |
|
|
$ |
3,655,309 |
|
|
$ |
3,476,178 |
|
|
$ |
3,457,737 |
|
Liabilities and
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
Deposits |
$ |
2,554,787 |
|
|
$ |
2,557,769 |
|
|
$ |
2,494,194 |
|
|
$ |
2,327,257 |
|
|
$ |
2,308,395 |
|
Borrowings |
535,000 |
|
|
435,000 |
|
|
685,000 |
|
|
680,000 |
|
|
680,000 |
|
Other liabilities |
52,806 |
|
|
60,468 |
|
|
63,047 |
|
|
60,025 |
|
|
62,112 |
|
Total liabilities |
3,142,593 |
|
|
3,053,237 |
|
|
3,242,241 |
|
|
3,067,282 |
|
|
3,050,507 |
|
Stockholders'
Equity |
|
|
|
|
|
|
|
|
|
Preferred stock, $0.01 par
value, 10,000,000 shares authorized, none issued or
outstanding |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Common stock, $0.01 par value,
60,000,000 shares authorized (2) |
171 |
|
|
177 |
|
|
178 |
|
|
180 |
|
|
183 |
|
Additional paid in
capital |
170,368 |
|
|
182,366 |
|
|
186,359 |
|
|
190,315 |
|
|
196,824 |
|
Retained earnings |
240,325 |
|
|
240,312 |
|
|
232,315 |
|
|
224,545 |
|
|
217,490 |
|
Unearned Employee Stock
Ownership Plan ("ESOP") shares |
(6,480 |
) |
|
(6,612 |
) |
|
(6,744 |
) |
|
(6,877 |
) |
|
(7,009 |
) |
Accumulated other
comprehensive income (loss) |
1,056 |
|
|
752 |
|
|
960 |
|
|
733 |
|
|
(258 |
) |
Total stockholders' equity |
405,440 |
|
|
416,995 |
|
|
413,068 |
|
|
408,896 |
|
|
407,230 |
|
Total Liabilities and Stockholders' Equity |
$ |
3,548,033 |
|
|
$ |
3,470,232 |
|
|
$ |
3,655,309 |
|
|
$ |
3,476,178 |
|
|
$ |
3,457,737 |
|
_________________________________
- Derived from audited financial statements.
- Shares of common stock issued and outstanding were 17,101,954
at March 31, 2020; 17,664,384 at December 31, 2019; 17,818,145 at
September 30, 2019; 17,984,105 at June 30, 2019; and 18,265,535 at
March 31, 2019.
Consolidated Statement of Income
(Unaudited)
|
Three Months Ended |
|
Nine Months Ended |
|
March 31, |
|
December 31, |
|
March 31, |
|
March 31, |
|
March 31, |
(Dollars in thousands) |
2020 |
|
2019 |
|
2019 |
|
2020 |
|
2019 |
Interest and Dividend
Income |
|
|
|
|
|
|
|
|
|
Loans |
$ |
29,781 |
|
|
$ |
32,119 |
|
|
$ |
30,770 |
|
|
$ |
94,166 |
|
|
$ |
90,042 |
|
Commercial paper and interest-bearing deposits |
1,794 |
|
|
1,912 |
|
|
2,283 |
|
|
5,959 |
|
|
6,106 |
|
Securities available for sale |
912 |
|
|
1,093 |
|
|
850 |
|
|
2,901 |
|
|
2,582 |
|
Other investments |
550 |
|
|
772 |
|
|
811 |
|
|
2,154 |
|
|
2,664 |
|
Total interest and dividend income |
33,037 |
|
|
35,896 |
|
|
34,714 |
|
|
105,180 |
|
|
101,394 |
|
Interest
Expense |
|
|
|
|
|
|
|
|
|
Deposits |
5,971 |
|
|
6,321 |
|
|
4,404 |
|
|
18,145 |
|
|
10,761 |
|
Borrowings |
1,757 |
|
|
2,541 |
|
|
3,741 |
|
|
7,619 |
|
|
10,691 |
|
Total interest expense |
7,728 |
|
|
8,862 |
|
|
8,145 |
|
|
25,764 |
|
|
21,452 |
|
Net Interest
Income |
25,309 |
|
|
27,034 |
|
|
26,569 |
|
|
79,416 |
|
|
79,942 |
|
Provision for Loan
Losses |
5,400 |
|
|
400 |
|
|
5,500 |
|
|
5,800 |
|
|
5,500 |
|
Net Interest Income
after Provision for Loan Losses |
19,909 |
|
|
26,634 |
|
|
21,069 |
|
|
73,616 |
|
|
74,442 |
|
Noninterest
Income |
|
|
|
|
|
|
|
|
|
Service charges and fees on deposit accounts |
2,304 |
|
|
2,605 |
|
|
2,265 |
|
|
7,352 |
|
|
7,243 |
|
Loan income and fees |
294 |
|
|
871 |
|
|
134 |
|
|
2,047 |
|
|
757 |
|
Gain on sale of loans held for sale |
1,503 |
|
|
3,775 |
|
|
1,472 |
|
|
7,577 |
|
|
4,086 |
|
BOLI income |
518 |
|
|
509 |
|
|
518 |
|
|
1,724 |
|
|
1,574 |
|
Other, net |
1,756 |
|
|
1,314 |
|
|
1,007 |
|
|
4,409 |
|
|
2,434 |
|
Total noninterest income |
6,375 |
|
|
9,074 |
|
|
5,396 |
|
|
23,109 |
|
|
16,094 |
|
Noninterest
Expense |
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
14,455 |
|
|
14,170 |
|
|
13,463 |
|
|
42,537 |
|
|
39,005 |
|
Net occupancy expense |
2,246 |
|
|
2,384 |
|
|
2,294 |
|
|
6,972 |
|
|
7,046 |
|
Computer services |
2,023 |
|
|
1,985 |
|
|
1,980 |
|
|
6,032 |
|
|
5,724 |
|
Telephone, postage, and supplies |
862 |
|
|
798 |
|
|
698 |
|
|
2,462 |
|
|
2,210 |
|
Marketing and advertising |
396 |
|
|
641 |
|
|
400 |
|
|
1,716 |
|
|
1,219 |
|
Deposit insurance premiums |
462 |
|
|
12 |
|
|
320 |
|
|
474 |
|
|
959 |
|
Loss (gain) on sale and impairment of REO |
(15 |
) |
|
122 |
|
|
246 |
|
|
88 |
|
|
500 |
|
REO expense |
250 |
|
|
238 |
|
|
200 |
|
|
746 |
|
|
548 |
|
Core deposit intangible amortization |
334 |
|
|
373 |
|
|
488 |
|
|
1,118 |
|
|
1,580 |
|
Other |
3,890 |
|
|
3,318 |
|
|
2,889 |
|
|
10,332 |
|
|
7,928 |
|
Total noninterest expense |
24,903 |
|
|
24,041 |
|
|
22,978 |
|
|
72,477 |
|
|
66,719 |
|
Income Before Income
Taxes |
1,381 |
|
|
11,667 |
|
|
3,487 |
|
|
24,248 |
|
|
23,817 |
|
Income Tax
Expense |
188 |
|
|
2,476 |
|
|
185 |
|
|
5,060 |
|
|
4,684 |
|
Net
Income |
$ |
1,193 |
|
|
$ |
9,191 |
|
|
$ |
3,302 |
|
|
$ |
19,188 |
|
|
$ |
19,133 |
|
Per Share Data
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
March 31, |
|
December 31, |
|
March 31, |
|
March 31, |
|
March 31, |
|
|
2020 |
|
2019 |
|
2019 |
|
2020 |
|
2019 |
Net income per common
share:(1) |
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.07 |
|
$ |
0.54 |
|
$ |
0.19 |
|
$ |
1.12 |
|
$ |
1.07 |
Diluted |
|
$ |
0.07 |
|
$ |
0.52 |
|
$ |
0.18 |
|
$ |
1.08 |
|
$ |
1.02 |
Average shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
16,688,646 |
|
16,906,457 |
|
17,506,018 |
|
16,898,391 |
|
17,811,962 |
Diluted |
|
17,258,428 |
|
17,567,680 |
|
18,197,429 |
|
17,524,252 |
|
18,528,161 |
Book value per share at end of
period |
|
$ |
23.71 |
|
$ |
23.61 |
|
$ |
22.29 |
|
$ |
23.71 |
|
$ |
22.29 |
Tangible book value per share
at end of period (2) |
|
$ |
22.15 |
|
$ |
22.08 |
|
$ |
20.77 |
|
$ |
22.15 |
|
$ |
20.77 |
Cash dividends declared per
common share |
|
$ |
0.07 |
|
$ |
0.07 |
|
$ |
0.06 |
|
$ |
0.20 |
|
$ |
0.12 |
Total shares outstanding at
end of period |
|
17,101,954 |
|
17,664,384 |
|
18,265,535 |
|
17,101,954 |
|
18,265,535 |
__________________________________________________
- Basic and diluted net income per common share have been
prepared in accordance with the two-class method.
- See Non-GAAP reconciliation tables below for adjustments.
Selected Financial Ratios and Other Data
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
March 31, |
|
December 31, |
|
March 31, |
|
March 31, |
|
March 31, |
|
|
2020 |
|
2019 |
|
2019 |
|
2020 |
|
2019 |
Performance ratios:
(1) |
|
|
|
|
|
|
Return on assets (ratio of net income to average total assets) |
|
0.14 |
% |
|
1.02 |
% |
|
0.39 |
% |
|
0.72 |
% |
|
0.76 |
% |
Return on equity (ratio of net
income to average equity) |
|
1.15 |
|
|
8.87 |
|
|
3.24 |
|
|
6.19 |
|
|
6.21 |
|
Tax equivalent yield on earning
assets(2) |
|
4.12 |
|
|
4.34 |
|
|
4.42 |
|
|
4.30 |
|
|
4.36 |
|
Rate paid on interest-bearing
liabilities |
|
1.16 |
|
|
1.27 |
|
|
1.23 |
|
|
1.25 |
|
|
1.11 |
|
Tax equivalent average
interest rate spread (2) |
|
2.96 |
|
|
3.07 |
|
|
3.19 |
|
|
3.05 |
|
|
3.25 |
|
Tax equivalent net interest
margin(2) (3) |
|
3.16 |
|
|
3.27 |
|
|
3.39 |
|
|
3.25 |
|
|
3.45 |
|
Average interest-earning assets
to average interest-bearing liabilities |
|
121.79 |
|
|
119.53 |
|
|
119.70 |
|
|
120.22 |
|
|
120.81 |
|
Operating expense to average
total assets |
|
2.84 |
|
|
2.66 |
|
|
2.69 |
|
|
2.72 |
|
|
2.64 |
|
Efficiency ratio |
|
78.60 |
|
|
66.58 |
|
|
71.88 |
|
|
70.69 |
|
|
69.47 |
|
Efficiency ratio - adjusted
(4) |
|
77.85 |
|
|
66.05 |
|
|
71.19 |
|
|
70.09 |
|
|
68.84 |
|
_____________________________
- Ratios are annualized where appropriate.
- The weighted average rate for municipal leases is adjusted for
a 24% combined federal and state tax rate since the interest from
these leases is tax exempt.
- Net interest income divided by average interest-earning
assets.
- See Non-GAAP reconciliation tables below for adjustments.
|
At or For the Three Months Ended |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
2020 |
|
2019 |
|
2019 |
|
2019 |
|
2019 |
Asset quality
ratios: |
|
|
|
|
|
|
|
|
|
Nonperforming assets to total assets(1) |
0.47 |
% |
|
0.45 |
% |
|
0.37 |
% |
|
0.38 |
% |
|
0.41 |
% |
Nonperforming loans to total
loans(1) |
0.59 |
|
|
0.56 |
|
|
0.43 |
|
|
0.38 |
|
|
0.43 |
|
Total classified assets to
total assets |
0.86 |
|
|
0.90 |
|
|
0.84 |
|
|
0.89 |
|
|
1.00 |
|
Allowance for loan losses to
nonperforming loans(1) |
171.40 |
|
|
154.48 |
|
|
195.88 |
|
|
206.90 |
|
|
215.46 |
|
Allowance for loan losses to
total loans |
1.01 |
|
|
0.86 |
|
|
0.85 |
|
|
0.79 |
|
|
0.92 |
|
Allowance for loan losses to
total gross loans excluding acquired loans(2) |
1.07 |
|
|
0.92 |
|
|
0.92 |
|
|
0.85 |
|
|
0.99 |
|
Net charge-offs (recoveries)
to average loans (annualized) |
0.09 |
|
|
(0.05 |
) |
|
0.02 |
|
|
0.47 |
|
|
0.38 |
|
Capital
ratios: |
|
|
|
|
|
|
|
|
|
Equity to total assets at end
of period |
11.43 |
% |
|
12.02 |
% |
|
11.30 |
% |
|
11.76 |
% |
|
11.78 |
% |
Tangible equity to total
tangible assets(2) |
10.76 |
|
|
11.33 |
|
|
10.63 |
|
|
11.06 |
|
|
11.06 |
|
Average equity to average
assets |
11.80 |
|
|
11.52 |
|
|
11.54 |
|
|
11.72 |
|
|
11.93 |
|
__________________________________________
- Nonperforming assets include nonaccruing loans, consisting of
certain restructured loans, and REO. There were no accruing loans
more than 90 days past due at the dates indicated. At March
31, 2020, there were $7.2 million of restructured loans included in
nonaccruing loans and $7.7 million, or 49.3% of nonaccruing loans
were current on their loan payments. Purchased impaired loans
acquired through bank acquisitions are excluded from nonaccruing
loans due to the accretion of discounts in accordance with the
acquisition method of accounting for business combinations.
- See Non-GAAP reconciliation tables below for adjustments.
Average Balance Sheet Data
|
For the Three Months Ended March 31, |
|
2020 |
|
2019 |
|
Average Balance Outstanding |
|
Interest Earned/ Paid(2) |
|
Yield/ Rate(2) |
|
Average Balance Outstanding |
|
Interest Earned/ Paid(2) |
|
Yield/ Rate(2) |
(Dollars in thousands) |
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
Loans receivable(1) |
$ |
2,669,796 |
|
|
$ |
30,086 |
|
|
4.51 |
% |
|
$ |
2,650,155 |
|
|
$ |
31,083 |
|
|
4.69 |
% |
Commercial paper and deposits
in other banks |
378,296 |
|
|
1,794 |
|
|
1.90 |
% |
|
337,522 |
|
|
2,283 |
|
|
2.71 |
% |
Securities available for
sale |
154,108 |
|
|
912 |
|
|
2.37 |
% |
|
139,898 |
|
|
850 |
|
|
2.43 |
% |
Other interest-earning
assets(3) |
37,877 |
|
|
550 |
|
|
5.81 |
% |
|
46,756 |
|
|
811 |
|
|
6.94 |
% |
Total interest-earning assets |
3,240,077 |
|
|
33,342 |
|
|
4.12 |
% |
|
3,174,331 |
|
|
35,027 |
|
|
4.42 |
% |
Other assets |
265,139 |
|
|
|
|
|
|
246,858 |
|
|
|
|
|
Total assets |
$ |
3,505,216 |
|
|
|
|
|
|
$ |
3,421,189 |
|
|
|
|
|
Liabilities and
equity: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposits: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing checking
accounts |
451,335 |
|
|
412 |
|
|
0.36 |
% |
|
463,807 |
|
|
332 |
|
|
0.29 |
% |
Money market accounts |
792,313 |
|
|
1,916 |
|
|
0.97 |
% |
|
701,692 |
|
|
1,408 |
|
|
0.80 |
% |
Savings accounts |
159,641 |
|
|
50 |
|
|
0.12 |
% |
|
188,848 |
|
|
58 |
|
|
0.12 |
% |
Certificate accounts |
783,758 |
|
|
3,593 |
|
|
1.83 |
% |
|
627,444 |
|
|
2,606 |
|
|
1.66 |
% |
Total interest-bearing deposits |
2,187,047 |
|
|
5,971 |
|
|
1.09 |
% |
|
1,981,791 |
|
|
4,404 |
|
|
0.89 |
% |
Borrowings |
473,319 |
|
|
1,757 |
|
|
1.48 |
% |
|
670,142 |
|
|
3,741 |
|
|
2.23 |
% |
Total interest-bearing
liabilities |
2,660,366 |
|
|
7,728 |
|
|
1.16 |
% |
|
2,651,933 |
|
|
8,145 |
|
|
1.23 |
% |
Noninterest-bearing
deposits |
342,581 |
|
|
|
|
|
|
298,118 |
|
|
|
|
|
Other liabilities |
88,725 |
|
|
|
|
|
|
63,015 |
|
|
|
|
|
Total liabilities |
3,091,672 |
|
|
|
|
|
|
3,013,066 |
|
|
|
|
|
Stockholders' equity |
413,544 |
|
|
|
|
|
|
408,123 |
|
|
|
|
|
Total liabilities and stockholders' equity |
$ |
3,505,216 |
|
|
|
|
|
|
$ |
3,421,189 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earning assets |
$ |
579,711 |
|
|
|
|
|
|
$ |
522,398 |
|
|
|
|
|
Average interest-earning
assets to |
|
|
|
|
|
|
|
|
|
|
|
average interest-bearing liabilities |
121.79 |
% |
|
|
|
|
|
119.70 |
% |
|
|
|
|
Tax-equivalent: |
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
$ |
25,614 |
|
|
|
|
|
|
$ |
26,882 |
|
|
|
Interest rate spread |
|
|
|
|
2.96 |
% |
|
|
|
|
|
3.19 |
% |
Net interest margin(4) |
|
|
|
|
3.16 |
% |
|
|
|
|
|
3.39 |
% |
Non-tax-equivalent: |
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
$ |
25,309 |
|
|
|
|
|
|
$ |
26,569 |
|
|
|
Interest rate spread |
|
|
|
|
2.92 |
% |
|
|
|
|
|
3.14 |
% |
Net interest margin(4) |
|
|
|
|
3.12 |
% |
|
|
|
|
|
3.35 |
% |
__________________(1) The average loans receivable, net balances
include loans held for sale and nonaccruing loans.(2) Interest
income used in the average interest earned and yield calculation
includes the tax equivalent adjustment of $305 and $313 for the
three months ended March 31, 2020 and 2019, respectively,
calculated based on a combined federal and state tax rate of
24%.(3) The average other interest-earning assets consist of FRB
stock, FHLB stock, and SBIC investments. (4) Net interest income
divided by average interest-earning assets.
|
For the Nine Months Ended March 31, |
|
2020 |
|
2019 |
|
Average Balance Outstanding |
|
InterestEarned/Paid(2) |
|
Yield/Rate(2) |
|
Average Balance Outstanding |
|
InterestEarned/Paid(2) |
|
Yield/Rate(2) |
(Dollars in thousands) |
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
Loans receivable(1) |
$ |
2,734,249 |
|
|
$ |
95,045 |
|
|
4.63 |
% |
|
$ |
2,608,485 |
|
|
$ |
90,918 |
|
|
4.65 |
% |
Commercial paper and deposits in
other banks |
362,598 |
|
|
5,959 |
|
|
2.19 |
% |
|
323,966 |
|
|
6,106 |
|
|
2.51 |
% |
Securities available for
sale |
152,798 |
|
|
2,901 |
|
|
2.53 |
% |
|
148,645 |
|
|
2,582 |
|
|
2.32 |
% |
Other interest-earning
assets(3) |
42,662 |
|
|
2,154 |
|
|
6.73 |
% |
|
44,453 |
|
|
2,664 |
|
|
8.02 |
% |
Total interest-earning assets |
3,292,307 |
|
|
106,059 |
|
|
4.30 |
% |
|
3,125,549 |
|
|
102,270 |
|
|
4.36 |
% |
Other assets |
266,097 |
|
|
|
|
|
|
245,360 |
|
|
|
|
|
Total assets |
$ |
3,558,404 |
|
|
|
|
|
|
$ |
3,370,909 |
|
|
|
|
|
Liabilities and
equity: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing checking
accounts |
449,560 |
|
|
1,105 |
|
|
0.33 |
% |
|
463,035 |
|
|
903 |
|
|
0.26 |
% |
Money market accounts |
765,492 |
|
|
5,760 |
|
|
1.00 |
% |
|
689,363 |
|
|
3,630 |
|
|
0.70 |
% |
Savings accounts |
166,711 |
|
|
153 |
|
|
0.12 |
% |
|
197,929 |
|
|
189 |
|
|
0.13 |
% |
Certificate accounts |
769,073 |
|
|
11,127 |
|
|
1.93 |
% |
|
573,647 |
|
|
6,039 |
|
|
1.40 |
% |
Total interest-bearing deposits |
2,150,836 |
|
|
18,145 |
|
|
1.12 |
% |
|
1,923,974 |
|
|
10,761 |
|
|
0.75 |
% |
Borrowings |
587,822 |
|
|
7,619 |
|
|
1.73 |
% |
|
663,157 |
|
|
10,691 |
|
|
2.15 |
% |
Total
interest-bearing liabilities |
2,738,658 |
|
|
25,764 |
|
|
1.25 |
% |
|
2,587,131 |
|
|
21,452 |
|
|
1.11 |
% |
Noninterest-bearing
deposits |
336,496 |
|
|
|
|
|
|
310,304 |
|
|
|
|
|
Other liabilities |
70,175 |
|
|
|
|
|
|
62,830 |
|
|
|
|
|
Total liabilities |
3,145,329 |
|
|
|
|
|
|
2,960,265 |
|
|
|
|
|
Stockholders' equity |
413,075 |
|
|
|
|
|
|
410,645 |
|
|
|
|
|
Total liabilities and stockholders' equity |
$ |
3,558,404 |
|
|
|
|
|
|
$ |
3,370,910 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earning assets |
$ |
553,649 |
|
|
|
|
|
|
$ |
538,418 |
|
|
|
|
|
Average interest-earning
assets to |
|
|
|
|
|
|
|
|
|
|
|
average interest-bearing liabilities |
120.22 |
% |
|
|
|
|
|
120.81 |
% |
|
|
|
|
Tax-equivalent: |
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
$ |
80,295 |
|
|
|
|
|
|
$ |
80,818 |
|
|
|
Interest rate spread |
|
|
|
|
3.05 |
% |
|
|
|
|
|
3.25 |
% |
Net interest margin(4) |
|
|
|
|
3.25 |
% |
|
|
|
|
|
3.45 |
% |
Non-tax-equivalent: |
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
$ |
79,416 |
|
|
|
|
|
|
$ |
79,942 |
|
|
|
Interest rate spread |
|
|
|
|
3.01 |
% |
|
|
|
|
|
3.22 |
% |
Net interest margin(4) |
|
|
|
|
3.22 |
% |
|
|
|
|
|
3.41 |
% |
__________________(1) The average loans receivable, net balances
include loans held for sale and nonaccruing loans.(2) Interest
income used in the average interest earned and yield calculation
includes the tax equivalent adjustment of $879 and $876 for the
nine months ended March 31, 2020 and 2019, respectively, calculated
based on a combined federal and state tax rate of 24%.(3) The
average other interest-earning assets consist of FRB stock, FHLB
stock, and SBIC investments. (4) Net interest income divided by
average interest-earning assets.
Loans
(Dollars in thousands) |
March 31, 2020 |
|
December 31, 2019 |
|
September 30, 2019 |
|
June 30, 2019 |
|
March 31, 2019 |
Retail consumer loans: |
|
|
|
|
|
|
|
|
|
One-to-four family |
$ |
487,777 |
|
|
$ |
417,255 |
|
|
$ |
396,649 |
|
|
$ |
660,591 |
|
|
$ |
658,723 |
|
HELOCs -
originated |
144,804 |
|
|
142,989 |
|
|
141,129 |
|
|
139.435 |
|
|
133,203 |
|
HELOCs - purchased |
82,232 |
|
|
92,423 |
|
|
104,324 |
|
|
116,972 |
|
|
128,832 |
|
Construction and
land/lots |
80,765 |
|
|
71,901 |
|
|
85,319 |
|
|
80,602 |
|
|
76,153 |
|
Indirect auto
finance |
135,449 |
|
|
142,533 |
|
|
147,808 |
|
|
153,448 |
|
|
162,127 |
|
Consumer |
11,576 |
|
|
11,102 |
|
|
11,400 |
|
|
11.416 |
|
|
19,374 |
|
Total retail consumer
loans |
942,603 |
|
|
878,203 |
|
|
886,629 |
|
|
1,162,464 |
|
|
1,178,412 |
|
Commercial loans: |
|
|
|
|
|
|
|
|
|
Commercial real
estate |
990,693 |
|
|
998,019 |
|
|
990,787 |
|
|
927,261 |
|
|
892,383 |
|
Construction and
development |
249,714 |
|
|
223,839 |
|
|
203,494 |
|
|
210,916 |
|
|
214,511 |
|
Commercial and
industrial |
164,539 |
|
|
152,727 |
|
|
158,706 |
|
|
160,471 |
|
|
154,471 |
|
Equipment finance |
198,962 |
|
|
185,427 |
|
|
154,479 |
|
|
132,058 |
|
|
109.175 |
|
Municipal leases |
115,992 |
|
|
115,240 |
|
|
114,382 |
|
|
112,016 |
|
|
112,067 |
|
Total commercial loans |
1,719,900 |
|
|
1,675,252 |
|
|
1,621,848 |
|
|
1,542,722 |
|
|
1,482,607 |
|
Total loans |
2,662,503 |
|
|
2,553,455 |
|
|
2,508,477 |
|
|
2,705,186 |
|
|
2,661,019 |
|
Deferred loan costs
(fees), net |
1,021 |
|
|
1,086 |
|
|
253 |
|
|
4 |
|
|
(372 |
) |
Total loans, net of deferred
loan fees |
2,663,524 |
|
|
2,554,541 |
|
|
2,508,730 |
|
|
2,705,190 |
|
|
2,660,647 |
|
Allowance for loan
losses |
(26,850 |
) |
|
(22,031 |
) |
|
(21,314 |
) |
|
(21,429 |
) |
|
(24,416 |
) |
Loans, net |
$ |
2,636,674 |
|
|
$ |
2,532,510 |
|
|
$ |
2,487,416 |
|
|
$ |
2,683,761 |
|
|
$ |
2,636,231 |
|
Deposits
(Dollars in thousands) |
March 31, 2020 |
|
December 31, 2019 |
|
September 30, 2019 |
|
June 30, 2019 |
|
March 31, 2019 |
Core deposits: |
|
|
|
|
|
|
|
|
|
Noninterest-bearing accounts |
$ |
322,812 |
|
|
$ |
327,320 |
|
|
$ |
327,371 |
|
|
$ |
294,322 |
|
|
$ |
301,083 |
|
NOW accounts |
496,561 |
|
|
457,428 |
|
|
449,623 |
|
|
452,295 |
|
|
477,637 |
|
Money market
accounts |
801,424 |
|
|
815,949 |
|
|
769,000 |
|
|
691,172 |
|
|
692,102 |
|
Savings accounts |
169,792 |
|
|
167,520 |
|
|
169,872 |
|
|
177,278 |
|
|
192,754 |
|
Total core deposits |
1,790,589 |
|
|
1,768,217 |
|
|
1,715,866 |
|
|
1,615,067 |
|
|
1,663,576 |
|
Certificates of deposit |
764,198 |
|
|
789,552 |
|
|
778,328 |
|
|
712,190 |
|
|
644,819 |
|
Total deposits |
$ |
2,554,787 |
|
|
$ |
2,557,769 |
|
|
$ |
2,494,194 |
|
|
$ |
2,327,257 |
|
|
$ |
2,308,395 |
|
Non-GAAP Reconciliations
In addition to results presented in accordance
with generally accepted accounting principles utilized in the
United States ("GAAP"), this earnings release contains certain
non-GAAP financial measures, which include: the efficiency ratio;
tangible book value; tangible book value per share; tangible equity
to tangible assets ratio; and the ratio of the allowance for loan
losses to total loans excluding acquired loans. The Company
believes these non-GAAP financial measures and ratios as presented
are useful for both investors and management to understand the
effects of certain items and provides an alternative view of the
Company's performance over time and in comparison to the Company's
competitors. These non-GAAP measures have inherent limitations, are
not required to be uniformly applied and are not audited. They
should not be considered in isolation or as a substitute for total
stockholders' equity or operating results determined in accordance
with GAAP. These non-GAAP measures may not be comparable to
similarly titled measures reported by other companies.
Set forth below is a reconciliation to GAAP of our efficiency
ratio:
|
|
Three Months Ended |
|
Nine Months Ended |
(Dollars in thousands) |
|
March 31, |
|
December 31, |
|
March 31, |
|
March 31, |
|
March 31, |
|
|
2020 |
|
2019 |
|
2019 |
|
2020 |
|
2019 |
Noninterest expense |
|
$ |
24,903 |
|
|
$ |
24,041 |
|
|
$ |
22,978 |
|
|
$ |
72,477 |
|
|
$ |
66,719 |
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
25,309 |
|
|
$ |
27,034 |
|
|
$ |
26,569 |
|
|
$ |
79,416 |
|
|
$ |
79,942 |
|
Plus noninterest income |
|
6,375 |
|
|
9,074 |
|
|
5,396 |
|
|
23,109 |
|
|
16,094 |
|
Plus tax equivalent
adjustment |
|
305 |
|
|
290 |
|
|
313 |
|
|
879 |
|
|
877 |
|
Net interest income plus
noninterest income – as adjusted |
|
$ |
31,989 |
|
|
$ |
36,398 |
|
|
$ |
32,278 |
|
|
$ |
103,404 |
|
|
$ |
96,913 |
|
Efficiency ratio - adjusted |
|
77.85 |
% |
|
66.05 |
% |
|
71.19 |
% |
|
70.09 |
% |
|
68.84 |
% |
Efficiency ratio |
|
78.60 |
% |
|
66.58 |
% |
|
71.88 |
% |
|
70.69 |
% |
|
69.47 |
% |
Set forth below is a reconciliation to GAAP of tangible book
value and tangible book value per share:
|
|
As of |
(Dollars in thousands, except per
share data) |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
|
2020 |
|
2019 |
|
2019 |
|
2019 |
|
2019 |
Total stockholders' equity |
|
$ |
405,440 |
|
|
$ |
416,995 |
|
|
$ |
413,068 |
|
|
$ |
408,896 |
|
|
$ |
407,230 |
|
Less: goodwill, core deposit
intangibles, net of taxes |
|
26,701 |
|
|
26,959 |
|
|
27,246 |
|
|
27,562 |
|
|
27,908 |
|
Tangible book value (1) |
|
$ |
378,739 |
|
|
$ |
390,036 |
|
|
$ |
385,822 |
|
|
$ |
381,334 |
|
|
$ |
379,322 |
|
Common shares outstanding |
|
17,101,954 |
|
|
17,664,384 |
|
|
17,818,145 |
|
|
17,984,105 |
|
|
18,265,535 |
|
Tangible book value per
share |
|
$ |
22.15 |
|
|
$ |
22.08 |
|
|
$ |
21.65 |
|
|
$ |
21.20 |
|
|
$ |
20.77 |
|
Book value per share |
|
$ |
23.71 |
|
|
$ |
23.61 |
|
|
$ |
23.18 |
|
|
$ |
22.74 |
|
|
$ |
22.29 |
|
(1)
Tangible book value is equal to total stockholders' equity less
goodwill and core deposit intangibles, net of related deferred tax
liabilities.
Set forth below is a reconciliation to GAAP of tangible equity
to tangible assets:
|
|
As of |
|
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
|
2020 |
|
2019 |
|
2019 |
|
2019 |
|
2019 |
|
|
(Dollars in thousands) |
Tangible equity(1) |
|
$ |
378,739 |
|
|
$ |
390,036 |
|
|
$ |
385,822 |
|
|
$ |
381,334 |
|
|
$ |
379,322 |
|
Total assets |
|
3,548,033 |
|
|
3,470,232 |
|
|
3,655,309 |
|
|
3,476,178 |
|
|
3,457,737 |
|
Less: goodwill, core deposit
intangibles, net of taxes |
|
26,701 |
|
|
29,959 |
|
|
27,246 |
|
|
27,562 |
|
|
27,908 |
|
Total tangible assets(2) |
|
$ |
3,521,332 |
|
|
$ |
3,443,273 |
|
|
$ |
3,628,063 |
|
|
$ |
3,448,616 |
|
|
$ |
3,429,829 |
|
Tangible equity to tangible
assets |
|
10.76 |
% |
|
11.33 |
% |
|
10.63 |
% |
|
11.06 |
% |
|
11.06 |
% |
(1) Tangible equity (or tangible book value) is equal to total
stockholders' equity less goodwill and core deposit intangibles,
net of related deferred tax liabilities.(2) Total tangible assets
is equal to total assets less goodwill and core deposit
intangibles, net of related deferred tax liabilities.
Set forth below is a reconciliation to GAAP of
the allowance for loan losses to total loans (excluding net
deferred loan fees) and the allowance for loan losses as adjusted
to exclude acquired loans:
|
|
As of |
(Dollars in thousands) |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
|
2020 |
|
2019 |
|
2019 |
|
2019 |
|
2019 |
Total gross loans receivable (GAAP) |
|
$ |
2,662,503 |
|
|
$ |
2,553,455 |
|
|
$ |
2,508,477 |
|
|
$ |
2,705,186 |
|
|
$ |
2,661,019 |
|
Less: acquired loans |
|
176,971 |
|
|
186,970 |
|
|
206,937 |
|
|
214,046 |
|
|
223,101 |
|
Adjusted loans (non-GAAP) |
|
$ |
2,485,532 |
|
|
$ |
2,366,485 |
|
|
$ |
2,301,540 |
|
|
$ |
2,491,140 |
|
|
$ |
2,437,918 |
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses
(GAAP) |
|
$ |
26,850 |
|
|
$ |
22,031 |
|
|
$ |
21,314 |
|
|
$ |
21,429 |
|
|
$ |
24,416 |
|
Less: allowance for loan losses
on acquired loans |
|
182 |
|
|
152 |
|
|
194 |
|
|
201 |
|
|
201 |
|
Adjusted allowance for loan
losses |
|
$ |
26,668 |
|
|
$ |
21,879 |
|
|
$ |
21,120 |
|
|
$ |
21,228 |
|
|
$ |
24,215 |
|
Adjusted allowance for loan
losses / Adjusted loans (non-GAAP) |
|
1.07 |
% |
|
0.92 |
% |
|
0.92 |
% |
|
0.85 |
% |
|
0.99 |
% |
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