ATLANTA, Oct. 18, 2018
/PRNewswire/ -- Fidelity Southern Corporation ("Fidelity" or
the "Company") (NASDAQ: LION), holding company for Fidelity Bank
(the "Bank"), today reported net income of $12.7 million, or $0.47 per diluted share, for the third quarter of
2018, compared with $9.4 million, or
$0.34 per diluted share, for the
second quarter of 2018, and with $7.9
million or $0.30 per diluted
share for the third quarter of 2017. For the year to date ended
September 30, 2018, the Company
reported net income of $33.9 million,
or $1.25 per diluted share, compared
with $27.4 million, or $1.03 per diluted share, for the same period in
2017.
Fidelity's Chairman, Jim Miller,
said, "The third quarter reflects a number of positive trends with
our decision to reduce our indirect auto business. Transitioning to
a more commercially focused balance sheet has allowed us to build
more customer relationships, help continue our good deposit growth,
provide net interest margin growth, and moderate our costs as the
banking industry and markets continue to change."
President Palmer Proctor added,
"The momentum we started last year has successfully generated over
$328 million, or 9%, total loan
growth since the end of the third quarter of 2017. This is in spite
of very competitive market conditions and accelerated payoffs. We
are fully focused on driving shareholder value through our balance
sheet transition strategy that will enhance liquidity, drive more
commercial bank growth, increase our bond portfolio, and allow us
to be more efficient in the back office."
BALANCE SHEET
Total assets decreased by $80.3 million, or 1.6%, during the quarter, to
$4.8 billion at September 30,
2018, primarily due to a decrease of $159.3
million in total loans. This decrease was driven by a
decrease of $110.5 million in
indirect auto loans as Fidelity exited all markets, except for
Florida and Georgia, at the end of last quarter. Servicing
rights also decreased by $8.7
million, primarily due to the previously announced
$1.2 billion sale of mortgage
servicing rights ("MSRs") during the quarter.
Offsetting these decreases, investments increased by
$60.4 million as the Bank continues
to increase its investments available-for-sale portfolio as part of
its strategy to reposition the balance sheet to higher yielding
assets, and reduce its reliance on "gain on sale" income. Cash
balances also increased by $25.1
million for the quarter.
Loans
Total loans, including loans held for sale,
decreased during the quarter by $159.3
million, or 3.8%, to $4.1
billion at September 30, 2018. This decrease was driven
by a reduction of $110.5 million in
indirect loans through normal attrition and $18.6 million in loan sales. As planned,
production of indirect auto loans decreased by $96.9 million compared to the previous
quarter.
Asset Quality
Asset quality remained strong as
nonperforming assets, excluding the guaranteed portion of
government loans ("adjusted NPA's") and acquired loans, decreased
during the quarter. Adjusted NPA's, a non-GAAP measure, decreased
by $3.3 million during the quarter.
The decrease was mainly due to the decrease in nonaccrual loans.
Credit quality trend performance remains consistent and strong as
net charge-offs decreased from 0.17% to 0.09% of average loans for
the quarter. Lower charge-offs helped drive the $1.9 million decrease in the provision for loan
losses for the quarter.
Fair Value Adjustments
Loan servicing rights decreased
by $8.7 million, or 6.9%, during the
quarter to $117.0 million at
September 30, 2018, compared to $125.7
million at June 30, 2018. MSRs, the primary component
of loan servicing rights, contributed the majority of the change,
decreasing by 6.9% to $106.9 million
at September 30, 2018, primarily due to the sale of MSRs noted
above. The current estimated fair market value of MSRs was
$111.6 million at September 30,
2018.
At September 30, 2018, fair value adjustments recorded on
the balance sheet for loans held for sale, interest rate lock
commitments ("IRLCs"), and hedge items were $11.8 million, a $3.0
million, or 20.1% decrease, from June 30, 2018. The
gross pipeline of interest rate lock commitments was $65.7 million lower at quarter end, compared to
June 30, 2018, due to slower seasonal
production.
Deposits
Core deposits grew by $17.7 million during the quarter to $3.1 billion with noninterest bearing demand
deposits contributing to nearly all of this growth. Noninterest
bearing deposits grew by 1.4% as interest bearing demand, money
market, and savings accounts remained flat. This increase was
offset by a decrease in time deposits of $37.4 million during the quarter, mainly due to a
decrease of $30.6 million in brokered
deposits, resulting in a decrease in total deposits of $19.7 million, or 0.5%.
INCOME STATEMENT
Net Income
Net income was
$12.7 million, or a $3.4 million increase over the previous quarter,
as net interest income increased by $2.3
million and noninterest expense decreased by $3.3 million, primarily due to a $1.7 million decrease in commissions as a 17.7%
decrease in mortgage loan production during the quarter drove lower
mortgage commissions. A decrease of $1.9
million in the provision for loan losses also contributed to
the increase in net income. Offsetting these changes was a decrease
in noninterest income of $3.3
million, primarily due to a $5.9
million decrease in mortgage banking income, offset by a
$2.8 million increase in other
operating income mainly due to a $2.6
million death benefit received from cash surrender value
life insurance policies during the quarter.
Net income was $4.8 million higher
compared to the same quarter a year ago, primarily due to an
increase in net interest income of $5.4
million.
Interest Income
Interest income of $46.9 million was higher by $2.1 million, compared to the prior quarter,
primarily driven by an increase of 25 basis points in the yield on
total loans. Interest income on loans for the quarter included a
$1.1 million interest recovery from
one nonaccrual commercial loan, which contributed 11 basis points
to this increase. Although average loans decreased by $111.7 million for the quarter, $98.7 million of this was due to a decrease in
lower yielding indirect loans, which were partially replaced in the
portfolio mix with higher yielding commercial and SBA loans. An
increase in average investment securities of $26.4 million also contributed to higher interest
income. The yield on total average interest-bearing assets
increased 23 basis points from the previous quarter.
As compared to the same period in the prior year, interest
income increased by $7.8 million as
average loans increased by $384.6
million and the yield on total average interest-bearing
assets increased by 43 basis points, as market interest rates
increased year over year.
Interest Expense
Interest expense of $8.1 million decreased slightly by $143,000, or 1.7%, for the quarter as average
FHLB borrowings decreased by $226.1
million.
As compared to the same period in the prior year, interest
expense increased by $2.4 million.
Rising market rates paid on money market deposits and CD's drove
the increase, as well as increased volume and rates for short term
borrowings.
Net Interest Margin
The net interest margin was 3.45%
for the quarter compared to 3.22% in the previous quarter, an
increase of 23 basis points. Adjusting the net interest margin for
the $1.1 million interest recovery,
the net interest margin percentage was 3.36% for the quarter. Loan
coupon yields, excluding fees, SBA discount accretion, and
accretable yields, increased faster than deposit and borrowing
costs during the quarter.
The yield on total interest-bearing liabilities increased by
only 2 basis points while the yield on average earning assets
increased by 23 basis points from 3.95% to 4.18%. The previously
mentioned interest recovery of $1.1
million contributed 11 basis points to this increase.
Average loans decreased by $111.7
million, of which $98.7
million was a decrease in lower yielding indirect auto
loans. Higher yielding commercial and SBA loans increased by
$40.8 million as the Bank's strategy
to reposition its balance sheet continues to occur.
Average interest-bearing liabilities decreased by $172.9 million, as average borrowings decreased
by $226.1 million during the quarter
since average deposit growth of $53.2
million helped to fund loan production.
As compared to the same period a year ago, the net interest
margin for the quarter increased by 25 basis points to 3.45% from
3.20%, primarily due to a 43 basis point increase in the yield on
total average interest-earning assets of $4.5 billion, offset by an increase of 27 basis
points in the yield on total average interest-bearing liabilities
of $3.1 billion. Average earning
assets increased by $307.0 million,
primarily due to an increase in average loans over the year.
Average interest-bearing liabilities increased by $136.1 million, primarily driven by an increase
in average borrowings of $148.2
million, offset by a decrease in average interest-bearing
deposits of $12.3 million.
Noninterest Income
On a linked-quarter basis,
noninterest income decreased by $3.3
million, or 9.0%, largely due to a net decrease in income
from mortgage banking activities of $5.9
million, or 20.0%. Gross mortgage revenue decreased by
$4.5 million and the mortgage MSR
valuation impairment resulted in a decrease in related income of
$1.3 million. Mortgage production
also decreased during the quarter by $160.7
million. Offsetting this decrease, other noninterest
income increased by $2.8 million,
primarily due to the $2.6 million
death benefit received from life insurance policies during the
quarter.
Compared to the same period a year ago, noninterest income for
the quarter of $33.7 million was
flat.
Noninterest Expense
On a linked-quarter basis, total
noninterest expense decreased by $3.3
million, or 5.6%, due to a decrease in commissions expense
of $1.7 million from lower mortgage
loan originations and a net decrease in all other noninterest
expenses of $1.5 million. These were
primarily due to projects related to debit card and ATM fraud loss,
outside service fees, utilities, and other liabilities, offset by
increased incentives related to the balance sheet strategies
implemented earlier in the year.
Compared to the second quarter of 2017, noninterest expense of
$55.6 million increased by
$2.7 million, or 5.2%. Salaries and
employee benefits expense increased by $2.5
million, or 9.4%, due primarily to an increase in headcount
of 63 in the mortgage and retail delivery and branches.
Income Taxes
On a linked-quarter basis, income
tax expense increased by $801,000,
primarily due to the increase in pre-tax income for the
quarter.
Compared to the third quarter of 2017, income tax expense
decreased by $1.1 million as the
effective tax rate decreased from 37.9% to 22.6% primarily as a
result of the Tax Cuts and Jobs Act enacted on December 22, 2017, which included, among other
things, a reduction in the federal corporate income tax rate from
35% to 21% from the beginning of the tax year 2018 going
forward.
OTHER NEWS
On August 30,
2018, the Bank sold MSRs relating to certain single family
mortgage loans serviced for the Federal National Mortgage
Association ("Fannie Mae") and the Federal Home Loan Mortgage
Corporation ("Freddie Mac"), with an aggregate unpaid principal
balance of approximately $1.2
billion, effective as of August 31,
2018 ("Sale Date"). Approximately $13.9 million in deposit balances representing
custodial funds and advances related to the MSRs were transferred
to the buyer by the Bank after the Sale Date. The sale represented
approximately 12% of the Bank's total single family mortgage
servicing portfolio as of August 31,
2018.
This was the first sale of MSRs executed by the Bank as part of
the Company's capital management strategy. The Bank anticipates
executing other MSRs sales from time to time in the future as part
of its ordinary course of business.
ABOUT FIDELITY SOUTHERN CORPORATION
Fidelity Southern
Corporation, through its operating subsidiaries, Fidelity Bank and
LionMark Insurance Company, provides banking services and Wealth
Management services and credit-related insurance products through
branches in Georgia and
Florida, and an insurance office
in Atlanta, Georgia. Indirect auto
loans are provided in Georgia and
Florida and mortgage loans are
provided throughout the South, while SBA loans are originated
nationwide. For additional information about Fidelity's products
and services, please visit the website at
www.FidelitySouthern.com.
NON-GAAP FINANCIAL MEASURES
This release contains
certain non-GAAP financial measures. The "GAAP TO NON-GAAP
RATIO RECONCILIATION" tables included below reconcile GAAP
to non-GAAP ratios. The non-GAAP ratios contain financial
information determined by methods other than in accordance with
GAAP. Management uses these "non-GAAP" financial measures in its
analysis of the Company's performance. Management believes that
presentation of these non-GAAP financial measures provides useful
supplemental information that allows better comparability with
prior periods, as well as with peers in the industry and provides a
greater understanding of the asset quality of the Company's loan
portfolio exclusive of the indirect auto, government-guaranteed and
acquired loan portfolios. These disclosures should not be viewed as
a substitute for operating results determined in accordance with
GAAP, nor are they necessarily comparable to non-GAAP performance
measures that may be presented by other companies.
SAFE HARBOR
This news release contains
forward-looking statements, as defined by Federal Securities Laws,
including statements about financial outlook and business
environment. These statements are provided to assist in the
understanding of future financial performance and such performance
involves risks and uncertainties that may cause actual results to
differ materially from those in such statements. Any such
statements are based on current expectations and involve a number
of risks and uncertainties. For a discussion of factors that may
cause such forward-looking statements to differ materially from
actual results, please refer to the section entitled "Forward
Looking Statements" from Fidelity Southern Corporation's 2017
Annual Report filed on Form 10-K with the Securities and Exchange
Commission. Additional information and other factors that could
affect future financial results are included in Fidelity's filings
with the Securities and Exchange Commission.
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (UNAUDITED)
|
|
|
As of or for the
Quarter Ended
|
|
|
As of or for the
Nine Months Ended
|
($ in thousands,
except per share data)
|
September 30,
2018
|
|
June 30,
2018
|
|
September 30,
2017
|
|
|
September 30,
2018
|
|
September 30,
2017
|
INCOME STATEMENT
DATA:
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
$
|
46,872
|
|
|
$
|
44,740
|
|
|
$
|
39,105
|
|
|
|
$
|
133,174
|
|
|
$
|
116,325
|
|
Interest
expense
|
8,125
|
|
|
8,268
|
|
|
5,711
|
|
|
|
23,187
|
|
|
16,951
|
|
Net interest
income
|
38,747
|
|
|
36,472
|
|
|
33,394
|
|
|
|
109,987
|
|
|
99,374
|
|
Provision for loan
losses
|
360
|
|
|
2,286
|
|
|
1,425
|
|
|
|
4,776
|
|
|
4,275
|
|
Noninterest
income
|
33,662
|
|
|
36,977
|
|
|
33,638
|
|
|
|
107,772
|
|
|
106,064
|
|
Noninterest
expense
|
55,585
|
|
|
58,852
|
|
|
52,837
|
|
|
|
169,179
|
|
|
157,960
|
|
Net income before
income taxes
|
16,464
|
|
|
12,311
|
|
|
12,770
|
|
|
|
43,804
|
|
|
43,203
|
|
Income tax
expense
|
3,722
|
|
|
2,921
|
|
|
4,836
|
|
|
|
9,905
|
|
|
15,850
|
|
Net income
|
12,742
|
|
|
9,390
|
|
|
7,934
|
|
|
|
33,899
|
|
|
27,353
|
|
PERFORMANCE:
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share - basic
|
$
|
0.47
|
|
|
$
|
0.35
|
|
|
$
|
0.30
|
|
|
|
$
|
1.25
|
|
|
$
|
1.03
|
|
Earnings per common
share - diluted
|
0.47
|
|
|
0.34
|
|
|
0.30
|
|
|
|
1.25
|
|
|
1.03
|
|
Total
revenues
|
72,409
|
|
|
73,449
|
|
|
67,032
|
|
|
|
217,759
|
|
|
205,438
|
|
Book value per common
share
|
15.85
|
|
|
15.48
|
|
|
14.47
|
|
|
|
15.85
|
|
|
14.47
|
|
Tangible book value
per common share(1)
|
15.43
|
|
|
15.05
|
|
|
14.00
|
|
|
|
15.43
|
|
|
14.00
|
|
Cash dividends paid
per common share
|
0.12
|
|
|
0.12
|
|
|
0.12
|
|
|
|
0.36
|
|
|
0.36
|
|
Dividend payout
ratio
|
25.53
|
%
|
|
34.29
|
%
|
|
40.00
|
%
|
|
|
28.80
|
%
|
|
34.95
|
%
|
Return on average
assets
|
1.05
|
%
|
|
0.77
|
%
|
|
0.70
|
%
|
|
|
0.95
|
%
|
|
0.81
|
%
|
Return on average
shareholders' equity
|
11.87
|
%
|
|
9.06
|
%
|
|
8.28
|
%
|
|
|
10.92
|
%
|
|
9.66
|
%
|
Equity to assets
ratio
|
8.98
|
%
|
|
8.60
|
%
|
|
8.61
|
%
|
|
|
8.98
|
%
|
|
8.61
|
%
|
Net interest
margin
|
3.45
|
%
|
|
3.22
|
%
|
|
3.20
|
%
|
|
|
3.32
|
%
|
|
3.20
|
%
|
END OF PERIOD
BALANCE SHEET SUMMARY:
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
$
|
4,812,056
|
|
|
$
|
4,892,369
|
|
|
$
|
4,505,423
|
|
|
|
$
|
4,812,056
|
|
|
$
|
4,505,423
|
|
Earning
assets
|
4,448,875
|
|
|
4,549,315
|
|
|
4,167,549
|
|
|
|
4,448,875
|
|
|
4,167,549
|
|
Loans, excluding
loans held-for-sale
|
3,706,953
|
|
|
3,792,886
|
|
|
3,409,707
|
|
|
|
3,706,953
|
|
|
3,409,707
|
|
Total
loans
|
4,078,272
|
|
|
4,237,572
|
|
|
3,750,036
|
|
|
|
4,078,272
|
|
|
3,750,036
|
|
Total
deposits
|
4,049,969
|
|
|
4,069,630
|
|
|
3,938,360
|
|
|
|
4,049,969
|
|
|
3,938,360
|
|
Shareholders'
equity
|
432,098
|
|
|
420,962
|
|
|
388,068
|
|
|
|
432,098
|
|
|
388,068
|
|
Assets serviced for
others(2)
|
10,882,832
|
|
|
10,632,607
|
|
|
10,109,466
|
|
|
|
10,882,832
|
|
|
10,109,466
|
|
ASSET QUALITY
RATIOS:
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs to
average loans
|
0.09
|
%
|
|
0.17
|
%
|
|
0.13
|
%
|
|
|
0.12
|
%
|
|
0.13
|
%
|
Allowance to
period-end loans
|
0.84
|
%
|
|
0.83
|
%
|
|
0.90
|
%
|
|
|
0.84
|
%
|
|
0.90
|
%
|
Adjusted allowance to
adjusted period end loans(1)
|
1.14
|
%
|
|
1.16
|
%
|
|
1.29
|
%
|
|
|
1.14
|
%
|
|
1.29
|
%
|
Nonperforming assets
to total loans, ORE and repossessions
|
1.92
|
%
|
|
1.96
|
%
|
|
1.71
|
%
|
|
|
1.92
|
%
|
|
1.71
|
%
|
Adjusted
nonperforming assets to loans, ORE and
repossessions(3)
|
0.92
|
%
|
|
0.99
|
%
|
|
1.05
|
%
|
|
|
0.92
|
%
|
|
1.05
|
%
|
Allowance to
nonperforming loans, ORE and repossessions
|
0.44x
|
|
|
0.42x
|
|
|
0.52x
|
|
|
|
0.44x
|
|
|
0.52x
|
|
SELECTED
RATIOS:
|
|
|
|
|
|
|
|
|
|
|
Loans to total
deposits
|
91.53
|
%
|
|
93.20
|
%
|
|
86.58
|
%
|
|
|
91.53
|
%
|
|
86.58
|
%
|
Average total loans
to average earning assets
|
92.29
|
%
|
|
92.90
|
%
|
|
89.85
|
%
|
|
|
92.63
|
%
|
|
89.61
|
%
|
Noninterest income to
total revenue
|
46.49
|
%
|
|
50.34
|
%
|
|
50.18
|
%
|
|
|
49.49
|
%
|
|
51.63
|
%
|
Leverage
ratio
|
8.96
|
%
|
|
8.43
|
%
|
|
8.81
|
%
|
|
|
8.96
|
%
|
|
8.81
|
%
|
Common equity tier 1
capital
|
9.15
|
%
|
|
8.45
|
%
|
|
8.81
|
%
|
|
|
9.15
|
%
|
|
8.81
|
%
|
Tier 1 risk-based
capital
|
10.24
|
%
|
|
9.50
|
%
|
|
9.96
|
%
|
|
|
10.24
|
%
|
|
9.96
|
%
|
Total risk-based
capital
|
12.78
|
%
|
|
11.99
|
%
|
|
12.68
|
%
|
|
|
12.78
|
%
|
|
12.68
|
%
|
Mortgage loan
production
|
$
|
748,044
|
|
|
$
|
908,754
|
|
|
$
|
752,854
|
|
|
|
$
|
2,270,112
|
|
|
$
|
2,106,277
|
|
Total mortgage loan
sales
|
771,058
|
|
|
800,084
|
|
|
731,595
|
|
|
|
2,067,626
|
|
|
1,986,671
|
|
Indirect automobile
production
|
86,801
|
|
|
183,675
|
|
|
256,084
|
|
|
|
529,036
|
|
|
822,341
|
|
Total indirect
automobile sales
|
18,614
|
|
|
29,275
|
|
|
27,115
|
|
|
|
133,889
|
|
|
371,546
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Non-GAAP
financial measure. See non-GAAP reconciliation table for the
comparable GAAP.
|
(2) Balances for September
30, 2018 include approximately $1.2 billion of sub-serviced loans
as a result of the August 31, 2018 MSRs sale. Servicing on these
loans transferred to the Purchaser on 10/1/18 and
10/16/18.
|
(3) Excludes acquired
loans and net of government guarantees. See non-GAAP reconciliation
table for the comparable GAAP.
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
|
|
($ in
thousands)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
September 30,
2017
|
ASSETS
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
182,672
|
|
|
$
|
157,586
|
|
|
$
|
312,027
|
|
Investment securities
available-for-sale
|
|
209,180
|
|
|
148,155
|
|
|
124,827
|
|
Investment securities
held-to-maturity
|
|
20,383
|
|
|
20,984
|
|
|
15,072
|
|
Loans
held-for-sale
|
|
371,319
|
|
|
444,686
|
|
|
340,329
|
|
|
|
|
|
|
|
|
Loans
|
|
3,706,953
|
|
|
3,792,886
|
|
|
3,409,707
|
|
Allowance for loan
losses
|
|
(31,157)
|
|
|
(31,623)
|
|
|
(30,703)
|
|
Loans, net of
allowance for loan losses
|
|
3,675,796
|
|
|
3,761,263
|
|
|
3,379,004
|
|
|
|
|
|
|
|
|
Premises and
equipment, net
|
|
91,359
|
|
|
90,246
|
|
|
87,792
|
|
Other real estate,
net
|
|
8,031
|
|
|
6,834
|
|
|
8,624
|
|
Bank owned life
insurance
|
|
71,092
|
|
|
72,703
|
|
|
71,455
|
|
Servicing rights,
net
|
|
116,982
|
|
|
125,704
|
|
|
111,890
|
|
Other
assets
|
|
65,242
|
|
|
64,208
|
|
|
54,403
|
|
Total
assets
|
|
$
|
4,812,056
|
|
|
$
|
4,892,369
|
|
|
$
|
4,505,423
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
Noninterest-bearing
demand deposits
|
|
$
|
1,249,391
|
|
|
$
|
1,232,650
|
|
|
$
|
1,112,714
|
|
Interest-bearing
deposits
|
|
|
|
|
|
|
Demand
deposits
|
|
477,477
|
|
|
491,307
|
|
|
464,780
|
|
Money market and
savings deposits
|
|
1,413,960
|
|
|
1,399,160
|
|
|
1,371,233
|
|
Time
deposits
|
|
909,141
|
|
|
946,513
|
|
|
989,633
|
|
Total
deposits
|
|
4,049,969
|
|
|
4,069,630
|
|
|
3,938,360
|
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
163,562
|
|
|
237,886
|
|
|
14,746
|
|
Subordinated debt,
net
|
|
120,680
|
|
|
120,653
|
|
|
120,554
|
|
Other
liabilities
|
|
45,747
|
|
|
43,238
|
|
|
43,695
|
|
Total
liabilities
|
|
4,379,958
|
|
|
4,471,407
|
|
|
4,117,355
|
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
Common
stock
|
|
226,605
|
|
|
223,771
|
|
|
212,633
|
|
Accumulated other
comprehensive (loss) income, net
|
|
(2,270)
|
|
|
(1,096)
|
|
|
964
|
|
Retained
earnings
|
|
207,763
|
|
|
198,287
|
|
|
174,471
|
|
Total shareholders'
equity
|
|
432,098
|
|
|
420,962
|
|
|
388,068
|
|
Total liabilities and
shareholders' equity
|
|
$
|
4,812,056
|
|
|
$
|
4,892,369
|
|
|
$
|
4,505,423
|
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
|
|
|
|
For the Quarter
Ended
|
|
|
For the Nine
Months Ended
|
($ in thousands,
except per share data)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
September 30,
2017
|
|
|
September 30,
2018
|
|
September 30,
2017
|
INTEREST
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
Loans, including
fees
|
|
$
|
44,746
|
|
|
$
|
42,845
|
|
|
$
|
37,290
|
|
|
|
$
|
127,440
|
|
|
$
|
110,933
|
|
Investment
securities
|
|
1,646
|
|
|
1,354
|
|
|
1,011
|
|
|
|
4,175
|
|
|
3,389
|
|
Other
|
|
480
|
|
|
541
|
|
|
804
|
|
|
|
1,559
|
|
|
2,003
|
|
Total interest
income
|
|
46,872
|
|
|
44,740
|
|
|
39,105
|
|
|
|
133,174
|
|
|
116,325
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
5,655
|
|
|
4,823
|
|
|
4,163
|
|
|
|
14,791
|
|
|
11,503
|
|
Other
borrowings
|
|
818
|
|
|
1,812
|
|
|
16
|
|
|
|
3,540
|
|
|
910
|
|
Subordinated
debt
|
|
1,652
|
|
|
1,633
|
|
|
1,532
|
|
|
|
4,856
|
|
|
4,538
|
|
Total interest
expense
|
|
8,125
|
|
|
8,268
|
|
|
5,711
|
|
|
|
23,187
|
|
|
16,951
|
|
Net interest
income
|
|
38,747
|
|
|
36,472
|
|
|
33,394
|
|
|
|
109,987
|
|
|
99,374
|
|
Provision for loan
losses
|
|
360
|
|
|
2,286
|
|
|
1,425
|
|
|
|
4,776
|
|
|
4,275
|
|
Net interest
income after provision for loan losses
|
|
38,387
|
|
|
34,186
|
|
|
31,969
|
|
|
|
105,211
|
|
|
95,099
|
|
NONINTEREST
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
Service charges on
deposit accounts
|
|
1,690
|
|
|
1,468
|
|
|
1,553
|
|
|
|
4,630
|
|
|
4,489
|
|
Other fees and
charges
|
|
2,464
|
|
|
2,449
|
|
|
2,197
|
|
|
|
7,148
|
|
|
6,060
|
|
Mortgage banking
activities
|
|
23,520
|
|
|
29,383
|
|
|
25,040
|
|
|
|
81,465
|
|
|
77,865
|
|
Indirect lending
activities
|
|
1,120
|
|
|
1,270
|
|
|
1,901
|
|
|
|
4,538
|
|
|
9,967
|
|
SBA lending
activities
|
|
914
|
|
|
1,217
|
|
|
1,460
|
|
|
|
3,288
|
|
|
3,959
|
|
Trust and wealth
management services
|
|
588
|
|
|
574
|
|
|
325
|
|
|
|
1,694
|
|
|
853
|
|
Other
|
|
3,366
|
|
|
616
|
|
|
1,162
|
|
|
|
5,009
|
|
|
2,871
|
|
Total noninterest
income
|
|
33,662
|
|
|
36,977
|
|
|
33,638
|
|
|
|
107,772
|
|
|
106,064
|
|
NONINTEREST
EXPENSE
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
28,805
|
|
|
28,215
|
|
|
26,331
|
|
|
|
84,581
|
|
|
77,621
|
|
Commissions
|
|
9,523
|
|
|
11,242
|
|
|
9,244
|
|
|
|
28,271
|
|
|
26,126
|
|
Occupancy and
equipment
|
|
4,654
|
|
|
4,541
|
|
|
4,508
|
|
|
|
14,127
|
|
|
13,371
|
|
Professional and
other services
|
|
4,243
|
|
|
4,635
|
|
|
4,604
|
|
|
|
13,676
|
|
|
13,723
|
|
Other
|
|
8,360
|
|
|
10,219
|
|
|
8,150
|
|
|
|
28,524
|
|
|
27,119
|
|
Total noninterest
expense
|
|
55,585
|
|
|
58,852
|
|
|
52,837
|
|
|
|
169,179
|
|
|
157,960
|
|
Income before
income tax expense
|
|
16,464
|
|
|
12,311
|
|
|
12,770
|
|
|
|
43,804
|
|
|
43,203
|
|
Income tax
expense
|
|
3,722
|
|
|
2,921
|
|
|
4,836
|
|
|
|
9,905
|
|
|
15,850
|
|
NET
INCOME
|
|
$
|
12,742
|
|
|
$
|
9,390
|
|
|
$
|
7,934
|
|
|
|
$
|
33,899
|
|
|
$
|
27,353
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER
COMMON SHARE:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.47
|
|
|
$
|
0.35
|
|
|
$
|
0.30
|
|
|
|
$
|
1.25
|
|
|
$
|
1.03
|
|
Diluted
|
|
$
|
0.47
|
|
|
$
|
0.34
|
|
|
$
|
0.30
|
|
|
|
$
|
1.25
|
|
|
$
|
1.03
|
|
Weighted average
common shares outstanding-basic
|
|
27,229
|
|
|
27,093
|
|
|
26,729
|
|
|
|
27,112
|
|
|
26,500
|
|
Weighted average
common shares outstanding-diluted
|
|
27,337
|
|
|
27,222
|
|
|
26,849
|
|
|
|
27,223
|
|
|
26,625
|
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
LOANS BY CATEGORY
(UNAUDITED)
|
|
($ in
thousands)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
Commercial
|
|
$
|
940,430
|
|
|
$
|
938,203
|
|
|
$
|
897,297
|
|
|
$
|
811,199
|
|
|
$
|
789,788
|
|
SBA
|
|
163,147
|
|
|
146,508
|
|
|
140,308
|
|
|
141,208
|
|
|
142,989
|
|
Total commercial and
SBA loans
|
|
1,103,577
|
|
|
1,084,711
|
|
|
1,037,605
|
|
|
952,407
|
|
|
932,777
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction
loans
|
|
262,048
|
|
|
269,330
|
|
|
265,780
|
|
|
248,317
|
|
|
243,600
|
|
|
|
|
|
|
|
|
|
|
|
|
Indirect
automobile
|
|
1,588,419
|
|
|
1,698,879
|
|
|
1,719,670
|
|
|
1,716,156
|
|
|
1,609,678
|
|
Installment loans and
personal lines of credit
|
|
29,260
|
|
|
31,807
|
|
|
28,716
|
|
|
25,995
|
|
|
26,189
|
|
Total consumer
loans
|
|
1,617,679
|
|
|
1,730,686
|
|
|
1,748,386
|
|
|
1,742,151
|
|
|
1,635,867
|
|
Residential
mortgage
|
|
571,081
|
|
|
555,636
|
|
|
512,673
|
|
|
489,721
|
|
|
452,584
|
|
Home equity lines of
credit
|
|
152,568
|
|
|
152,523
|
|
|
149,864
|
|
|
148,370
|
|
|
144,879
|
|
Total mortgage
loans
|
|
723,649
|
|
|
708,159
|
|
|
662,537
|
|
|
638,091
|
|
|
597,463
|
|
Loans
|
|
3,706,953
|
|
|
3,792,886
|
|
|
3,714,308
|
|
|
3,580,966
|
|
|
3,409,707
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
held-for-sale:
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgage
|
|
328,090
|
|
|
399,630
|
|
|
355,515
|
|
|
269,140
|
|
|
257,325
|
|
SBA
|
|
18,229
|
|
|
20,056
|
|
|
19,785
|
|
|
13,615
|
|
|
8,004
|
|
Indirect
automobile
|
|
25,000
|
|
|
25,000
|
|
|
50,000
|
|
|
75,000
|
|
|
75,000
|
|
Total loans
held-for-sale
|
|
371,319
|
|
|
444,686
|
|
|
425,300
|
|
|
357,755
|
|
|
340,329
|
|
Total loans
|
|
$
|
4,078,272
|
|
|
$
|
4,237,572
|
|
|
$
|
4,139,608
|
|
|
$
|
3,938,721
|
|
|
$
|
3,750,036
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPOSITS BY
CATEGORY
(UNAUDITED)
|
|
|
For the Quarter
Ended
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
($ in
thousands)
|
Average
Amount
|
|
Rate
|
|
Average
Amount
|
|
Rate
|
|
Average
Amount
|
|
Rate
|
|
Average
Amount
|
|
Rate
|
|
Average
Amount
|
|
Rate
|
Noninterest-bearing
demand deposits
|
$
|
1,244,640
|
|
|
—
|
%
|
|
$
|
1,172,298
|
|
|
—
|
%
|
|
$
|
1,120,562
|
|
|
—
|
%
|
|
$
|
1,124,759
|
|
|
—
|
%
|
|
$
|
1,103,414
|
|
|
—
|
%
|
Interest-bearing
demand
deposits
|
463,292
|
|
|
0.13
|
%
|
|
489,051
|
|
|
0.14
|
%
|
|
461,614
|
|
|
0.14
|
%
|
|
453,714
|
|
|
0.11
|
%
|
|
447,348
|
|
|
0.12
|
%
|
Money market
and
savings deposits
|
1,415,868
|
|
|
0.70
|
%
|
|
1,349,447
|
|
|
0.61
|
%
|
|
1,345,905
|
|
|
0.55
|
%
|
|
1,381,207
|
|
|
0.53
|
%
|
|
1,341,189
|
|
|
0.49
|
%
|
Time
deposits
|
918,668
|
|
|
1.30
|
%
|
|
906,133
|
|
|
1.16
|
%
|
|
901,394
|
|
|
1.04
|
%
|
|
958,790
|
|
|
0.94
|
%
|
|
1,021,563
|
|
|
0.92
|
%
|
Total average
deposits
|
$
|
4,042,468
|
|
|
0.55
|
%
|
|
$
|
3,916,929
|
|
|
0.49
|
%
|
|
$
|
3,829,475
|
|
|
0.46
|
%
|
|
$
|
3,918,470
|
|
|
0.43
|
%
|
|
$
|
3,913,514
|
|
|
0.42
|
%
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
NONPERFORMING AND CLASSIFIED ASSETS
(UNAUDITED)
|
|
($ in
thousands)
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
NONPERFORMING
ASSETS
|
|
|
|
|
|
|
|
|
|
Nonaccrual loans
(2)(6)
|
$
|
53,173
|
|
|
$
|
58,027
|
|
|
$
|
58,706
|
|
|
$
|
47,012
|
|
|
$
|
41,408
|
|
Loans past due 90
days or more and still accruing
|
8,858
|
|
|
8,278
|
|
|
7,728
|
|
|
6,313
|
|
|
6,534
|
|
Repossessions
|
1,271
|
|
|
1,303
|
|
|
1,853
|
|
|
2,392
|
|
|
2,040
|
|
Other real estate
(ORE)
|
8,031
|
|
|
6,834
|
|
|
7,668
|
|
|
7,621
|
|
|
8,624
|
|
Nonperforming
assets
|
$
|
71,333
|
|
|
$
|
74,442
|
|
|
$
|
75,955
|
|
|
$
|
63,338
|
|
|
$
|
58,606
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY
RATIOS
|
|
|
|
|
|
|
|
|
|
Loans 30-89 days past
due
|
$
|
6,858
|
|
|
$
|
6,514
|
|
|
$
|
15,695
|
|
|
$
|
22,079
|
|
|
$
|
10,193
|
|
Loans 30-89 days past
due to loans
|
0.19
|
%
|
|
0.17
|
%
|
|
0.42
|
%
|
|
0.62
|
%
|
|
0.30
|
%
|
Loans past due 90
days or more and still accruing to loans
|
0.24
|
%
|
|
0.22
|
%
|
|
0.21
|
%
|
|
0.18
|
%
|
|
0.19
|
%
|
Nonperforming loans
as a % of loans
|
1.67
|
%
|
|
1.75
|
%
|
|
1.79
|
%
|
|
1.49
|
%
|
|
1.41
|
%
|
Nonperforming assets
to loans, ORE, and repossessions
|
1.92
|
%
|
|
1.96
|
%
|
|
2.04
|
%
|
|
1.76
|
%
|
|
1.71
|
%
|
Adjusted
nonperforming assets to adjusted loans, ORE and
repossessions(8)
|
0.92
|
%
|
|
0.99
|
%
|
|
1.14
|
%
|
|
1.06
|
%
|
|
1.05
|
%
|
Nonperforming assets
to total assets
|
1.48
|
%
|
|
1.52
|
%
|
|
1.58
|
%
|
|
1.38
|
%
|
|
1.30
|
%
|
Adjusted
nonperforming assets to total
assets(8)
|
0.68
|
%
|
|
0.73
|
%
|
|
0.84
|
%
|
|
0.79
|
%
|
|
0.75
|
%
|
Classified Asset
Ratio(4)
|
19.60
|
%
|
|
21.84
|
%
|
|
21.70
|
%
|
|
20.70
|
%
|
|
20.59
|
%
|
ALL to nonperforming
loans
|
50.23
|
%
|
|
47.69
|
%
|
|
46.57
|
%
|
|
55.83
|
%
|
|
64.04
|
%
|
Net charge-offs,
annualized to average loans
|
0.09
|
%
|
|
0.17
|
%
|
|
0.11
|
%
|
|
0.11
|
%
|
|
0.13
|
%
|
ALL as a % of
loans
|
0.84
|
%
|
|
0.83
|
%
|
|
0.83
|
%
|
|
0.83
|
%
|
|
0.90
|
%
|
Adjusted ALL as a %
of adjusted loans(7)
|
1.14
|
%
|
|
1.16
|
%
|
|
1.15
|
%
|
|
1.16
|
%
|
|
1.29
|
%
|
ALL as a % of loans,
excluding acquired loans(5)
|
0.88
|
%
|
|
0.87
|
%
|
|
0.88
|
%
|
|
0.88
|
%
|
|
0.96
|
%
|
|
|
|
|
|
|
|
|
|
|
CLASSIFIED
ASSETS
|
|
|
|
|
|
|
|
|
|
Classified
loans(1)
|
$
|
80,176
|
|
|
$
|
87,688
|
|
|
$
|
83,867
|
|
|
$
|
77,679
|
|
|
$
|
75,033
|
|
ORE and
repossessions
|
9,302
|
|
|
8,137
|
|
|
9,521
|
|
|
10,013
|
|
|
10,664
|
|
Total classified
assets(3)
|
$
|
89,478
|
|
|
$
|
95,825
|
|
|
$
|
93,388
|
|
|
$
|
87,692
|
|
|
$
|
85,697
|
|
|
|
|
|
|
|
|
|
|
|
(1) Amount of SBA guarantee
included in classified loans
|
$
|
5,254
|
|
|
$
|
4,870
|
|
|
$
|
2,879
|
|
|
$
|
2,930
|
|
|
$
|
2,755
|
|
(2)
Amount of repurchased government-guaranteed loans, primarily
residential mortgage loans, included in nonaccrual
loans
|
$
|
27,218
|
|
|
$
|
27,220
|
|
|
$
|
26,091
|
|
|
$
|
19,478
|
|
|
$
|
15,450
|
|
(3)
Classified assets include loans having a risk rating of
substandard or worse, both accrual and nonaccrual, repossessions
and ORE, net of loss share and purchase discounts (for periods
prior to 2018)
|
(4)
Classified asset ratio is defined as classified assets as a
percentage of the sum of Tier 1 capital plus allowance for loan
losses
|
(5)
Allowance calculation excludes the recorded investment of
acquired loans, due to valuation calculated at
acquisition
|
(6)
Excludes purchased credit impaired (PCI) loans which are not
removed from their accounting pool
|
(7)
Excludes indirect and acquired loans. See non-GAAP
reconciliation table for a reconciliation to the comparable GAAP
measure
|
(8)
Excludes acquired loans and net of government guarantees. See
non-GAAP reconciliation table for a reconciliation to the
comparable GAAP measure
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
|
INCOME FROM
INDIRECT LENDING ACTIVITIES
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Quarter
Ended
|
(in
thousands)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
Loan servicing
revenue
|
|
$
|
1,581
|
|
|
$
|
1,690
|
|
|
$
|
1,769
|
|
|
$
|
2,158
|
|
|
$
|
2,130
|
|
Gain on sale of
loans
|
|
53
|
|
|
22
|
|
|
442
|
|
|
532
|
|
|
263
|
|
Gain on
capitalization of servicing rights
|
|
124
|
|
|
196
|
|
|
569
|
|
|
406
|
|
|
182
|
|
Ancillary loan
servicing revenue
|
|
162
|
|
|
166
|
|
|
183
|
|
|
247
|
|
|
172
|
|
Gross indirect lending revenue
|
|
1,920
|
|
|
2,074
|
|
|
2,963
|
|
|
3,343
|
|
|
2,747
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Amortization of
servicing rights, net
|
|
(800)
|
|
|
(804)
|
|
|
(815)
|
|
|
(777)
|
|
|
(846)
|
|
Total income from
indirect lending activities
|
|
$
|
1,120
|
|
|
$
|
1,270
|
|
|
$
|
2,148
|
|
|
$
|
2,566
|
|
|
$
|
1,901
|
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
|
ANALYSIS OF
INDIRECT LENDING
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of or for the
Quarter Ended
|
($ in
thousands)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
Average loans
outstanding(1)
|
|
$
|
1,673,014
|
|
|
$
|
1,771,665
|
|
|
$
|
1,784,982
|
|
|
$
|
1,748,179
|
|
|
$
|
1,627,946
|
|
Loans serviced for
others
|
|
$
|
838,574
|
|
|
$
|
932,915
|
|
|
$
|
1,018,743
|
|
|
$
|
1,056,509
|
|
|
$
|
1,114,710
|
|
Past due
loans:
|
|
|
|
|
|
|
|
|
|
|
Amount 30+ days past
due
|
|
2,659
|
|
|
2,407
|
|
|
2,257
|
|
|
3,423
|
|
|
2,965
|
|
Number 30+ days past
due
|
|
258
|
|
|
217
|
|
|
197
|
|
|
283
|
|
|
255
|
|
30+ day performing
delinquency rate(2)
|
|
0.16
|
%
|
|
0.14
|
%
|
|
0.13
|
%
|
|
0.19
|
%
|
|
0.18
|
%
|
Nonperforming
loans
|
|
1,490
|
|
|
1,526
|
|
|
1,539
|
|
|
1,916
|
|
|
1,405
|
|
Nonperforming loans
as a percentage of
period end
loans(2)
|
|
0.09
|
%
|
|
0.09
|
%
|
|
0.09
|
%
|
|
0.11
|
%
|
|
0.08
|
%
|
Net
charge-offs
|
|
$
|
1,069
|
|
|
$
|
864
|
|
|
$
|
1,147
|
|
|
$
|
798
|
|
|
$
|
1,047
|
|
Net charge-off
rate(3)
|
|
0.26
|
%
|
|
0.20
|
%
|
|
0.27
|
%
|
|
0.19
|
%
|
|
0.27
|
%
|
Number of vehicles
repossessed during
the period
|
|
139
|
|
|
132
|
|
|
140
|
|
|
107
|
|
|
132
|
|
Quarterly production
weighted average
beacon score
|
|
769
|
|
|
779
|
|
|
781
|
|
|
783
|
|
|
776
|
|
|
|
(1)
Includes
held-for-sale
|
(2) Calculated by dividing loan category as of the end
of the period by period-end loans including held for sale for the
specified loan portfolio
|
(3) Calculated by dividing annualized net charge-offs
for the period by average loans held for investment during the
period for the specified loan category
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
|
ANALYSIS OF
INDIRECT LENDING
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of or for the
Quarter Ended
|
($ in
thousands)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
Production by
state:
|
|
|
|
|
|
|
|
|
|
|
|
Alabama
(3)
|
|
$
|
50
|
|
|
$
|
9,920
|
|
|
$
|
12,239
|
|
|
$
|
19,216
|
|
|
$
|
13,587
|
|
|
Arkansas
(3)
|
|
—
|
|
|
4,488
|
|
|
20,322
|
|
|
30,732
|
|
|
26,997
|
|
|
North Carolina
(3)
|
|
97
|
|
|
15,580
|
|
|
23,383
|
|
|
28,912
|
|
|
16,545
|
|
|
South Carolina
(3)
|
|
—
|
|
|
11,065
|
|
|
12,322
|
|
|
16,559
|
|
|
10,959
|
|
|
Florida
|
|
51,620
|
|
|
52,645
|
|
|
65,786
|
|
|
87,750
|
|
|
51,723
|
|
|
Georgia
|
|
35,034
|
|
|
38,322
|
|
|
38,288
|
|
|
45,571
|
|
|
31,266
|
|
|
Mississippi
(3)
|
|
—
|
|
|
22,605
|
|
|
24,785
|
|
|
32,141
|
|
|
24,535
|
|
|
Tennessee
(3)
|
|
—
|
|
|
11,098
|
|
|
13,509
|
|
|
17,635
|
|
|
10,931
|
|
|
Virginia
(3)
|
|
—
|
|
|
—
|
|
|
3,620
|
|
|
6,495
|
|
|
8,223
|
|
|
Texas
(2)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,312
|
|
|
Louisiana
(3)
|
|
—
|
|
|
17,952
|
|
|
44,306
|
|
|
60,021
|
|
|
47,576
|
|
|
Oklahoma
(2)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
430
|
|
|
|
Total production by
state
|
|
$
|
86,801
|
|
|
$
|
183,675
|
|
|
$
|
258,560
|
|
|
$
|
345,032
|
|
|
$
|
256,084
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan sales
|
|
$
|
18,614
|
|
|
$
|
29,275
|
|
|
$
|
86,000
|
|
|
$
|
59,681
|
|
|
$
|
27,115
|
|
Portfolio yield
(1)
|
|
3.08
|
%
|
|
3.02
|
%
|
|
2.98
|
%
|
|
2.98
|
%
|
|
2.92
|
%
|
|
|
(1)
|
Includes
held-for-sale
|
(2)
|
Fidelity exited
the Oklahoma and Texas markets in Q3 2017
|
(3)
|
Fidelity exited
the Alabama, Arkansas, North Carolina, South Carolina, Mississippi,
Tennessee, Virginia, and Louisiana markets in 2018
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
|
INCOME FROM
MORTGAGE BANKING ACTIVITIES
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of or for the
Quarter Ended
|
(in
thousands)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
Marketing gain,
net
|
|
$
|
16,427
|
|
|
$
|
20,330
|
|
|
$
|
17,575
|
|
|
$
|
16,683
|
|
|
$
|
19,713
|
|
Origination points
and fees
|
|
4,707
|
|
|
5,495
|
|
|
3,647
|
|
|
3,482
|
|
|
3,815
|
|
Loan servicing
revenue
|
|
6,360
|
|
|
6,206
|
|
|
6,221
|
|
|
5,851
|
|
|
5,616
|
|
Gross mortgage
revenue
|
|
$
|
27,494
|
|
|
$
|
32,031
|
|
|
$
|
27,443
|
|
|
$
|
26,016
|
|
|
$
|
29,144
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
MSR
amortization
|
|
(3,369)
|
|
|
(3,331)
|
|
|
(3,426)
|
|
|
(3,609)
|
|
|
(3,560)
|
|
MSR
recovery/(impairment), net
|
|
(605)
|
|
|
683
|
|
|
4,545
|
|
|
(1,476)
|
|
|
(544)
|
|
Total income from
mortgage
banking activities
|
|
$
|
23,520
|
|
|
$
|
29,383
|
|
|
$
|
28,562
|
|
|
$
|
20,931
|
|
|
$
|
25,040
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
|
ANALYSIS OF
MORTGAGE LENDING
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of or for the
Quarter Ended
|
($ in
thousands)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
Production by
region:
|
|
|
|
|
|
|
|
|
|
|
Georgia
|
|
$
|
436,889
|
|
|
$
|
545,951
|
|
|
$
|
368,739
|
|
|
$
|
423,876
|
|
|
$
|
490,323
|
|
Florida
|
|
120,230
|
|
|
136,990
|
|
|
109,034
|
|
|
103,490
|
|
|
95,010
|
|
Alabama/Tennessee
|
|
748
|
|
|
2,433
|
|
|
2,709
|
|
|
4,609
|
|
|
7,299
|
|
Virginia/Maryland
|
|
130,728
|
|
|
148,970
|
|
|
91,842
|
|
|
106,398
|
|
|
129,774
|
|
North and South
Carolina
|
|
59,449
|
|
|
74,410
|
|
|
40,990
|
|
|
31,360
|
|
|
30,448
|
|
Total
production by region
|
|
$
|
748,044
|
|
|
$
|
908,754
|
|
|
$
|
613,314
|
|
|
$
|
669,733
|
|
|
$
|
752,854
|
|
|
|
|
|
|
|
|
|
|
|
|
% for
purchases
|
|
90.6
|
%
|
|
91.6
|
%
|
|
85.1
|
%
|
|
82.9
|
%
|
|
86.3
|
%
|
% for refinance
loans
|
|
9.4
|
%
|
|
8.4
|
%
|
|
14.9
|
%
|
|
17.1
|
%
|
|
13.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Portfolio
Production:
|
|
$
|
56,108
|
|
|
$
|
75,990
|
|
|
$
|
44,554
|
|
|
$
|
66,236
|
|
|
$
|
56,072
|
|
|
|
|
|
|
|
|
|
|
|
|
Funded loan type
(UPB):
|
|
|
|
|
|
|
|
|
|
|
Conventional
|
|
64.3
|
%
|
|
63.8
|
%
|
|
65.9
|
%
|
|
62.0
|
%
|
|
62.0
|
%
|
FHA/VA/USDA
|
|
21.5
|
%
|
|
20.7
|
%
|
|
22.1
|
%
|
|
21.5
|
%
|
|
23.3
|
%
|
Jumbo
|
|
14.2
|
%
|
|
15.5
|
%
|
|
12.0
|
%
|
|
16.5
|
%
|
|
14.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross pipeline of
locked loans to be
sold (UPB)
|
|
$
|
289,065
|
|
|
$
|
354,735
|
|
|
$
|
382,386
|
|
|
$
|
203,896
|
|
|
$
|
265,444
|
|
Loans held for sale
(UPB)
|
|
$
|
322,722
|
|
|
$
|
389,858
|
|
|
$
|
348,797
|
|
|
$
|
262,315
|
|
|
$
|
250,960
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loan sales
(UPB)
|
|
$
|
771,058
|
|
|
$
|
800,084
|
|
|
$
|
496,484
|
|
|
$
|
602,171
|
|
|
$
|
731,595
|
|
Conventional
|
|
66.6
|
%
|
|
70.7
|
%
|
|
69.1
|
%
|
|
64.3
|
%
|
|
63.0
|
%
|
FHA/VA/USDA
|
|
24.5
|
%
|
|
21.3
|
%
|
|
27.2
|
%
|
|
25.0
|
%
|
|
27.1
|
%
|
Jumbo
|
|
8.9
|
%
|
|
8.0
|
%
|
|
3.7
|
%
|
|
10.7
|
%
|
|
9.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average loans
outstanding(1)
|
|
$
|
877,890
|
|
|
$
|
913,430
|
|
|
$
|
725,444
|
|
|
$
|
701,932
|
|
|
$
|
698,068
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Includes held-for-sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
|
THIRD PARTY
MORTGAGE LOAN SERVICING
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of or for the
Quarter Ended
|
($ in
thousands)
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
Loans serviced for
others (UPB)(1)
|
|
$
|
8,687,984
|
|
|
$
|
9,450,326
|
|
|
$
|
9,097,869
|
|
|
$
|
8,917,117
|
|
|
$
|
8,715,198
|
|
Average loans
serviced for others (UPB)(1)
|
|
$
|
9,279,843
|
|
|
$
|
9,244,175
|
|
|
$
|
9,038,568
|
|
|
$
|
8,896,305
|
|
|
$
|
8,657,475
|
|
|
|
|
|
|
|
|
|
|
|
|
MSR book value, net
of amortization
|
|
$
|
108,876
|
|
|
$
|
119,372
|
|
|
$
|
113,217
|
|
|
$
|
110,497
|
|
|
$
|
107,434
|
|
MSR
impairment
|
|
(2,000)
|
|
|
(4,590)
|
|
|
(5,274)
|
|
|
(9,818)
|
|
|
(8,343)
|
|
MSR net carrying
value
|
|
$
|
106,876
|
|
|
$
|
114,782
|
|
|
$
|
107,943
|
|
|
$
|
100,679
|
|
|
$
|
99,091
|
|
|
|
|
|
|
|
|
|
|
|
|
MSR carrying value as
a % of period end UPB
|
|
1.23
|
%
|
|
1.21
|
%
|
|
1.19
|
%
|
|
1.13
|
%
|
|
1.14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delinquency % loans
serviced for others
|
|
1.28
|
%
|
|
1.28
|
%
|
|
1.24
|
%
|
|
1.87
|
%
|
|
1.41
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MSR revenue
multiple(2)
|
|
4.49
|
|
|
4.52
|
|
|
4.31
|
|
|
4.29
|
|
|
4.38
|
|
(1)
Balances for September 30, 2018 exclude the UPB of loans
temporarily sub-serviced as a result of the August 31, 2018 MSRs
sale. Servicing transferred to the Purchaser on 10/1/18 and
10/16/18.
|
(2)
MSR carrying value (period end) to period end loans serviced for
others divided by the ratio of annualized mortgage loan servicing
revenue to average mortgage loans serviced for
others.
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
AVERAGE BALANCE
AND YIELDS
(UNAUDITED)
|
|
|
For the Quarter
Ended
|
|
September 30,
2018
|
|
June 30,
2018
|
|
September 30,
2017
|
|
Average
|
|
Yield/
|
|
Average
|
|
Yield/
|
|
Average
|
|
Yield/
|
($ in
thousands)
|
Balance
|
|
Rate
|
|
Balance
|
|
Rate
|
|
Balance
|
|
Rate
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
$
|
949,747
|
|
|
5.27
|
%
|
|
$
|
920,995
|
|
|
4.71
|
%
|
|
$
|
802,318
|
|
|
4.65
|
%
|
SBA
|
166,467
|
|
|
8.07
|
%
|
|
154,459
|
|
|
7.16
|
%
|
|
150,733
|
|
|
7.81
|
%
|
Construction
|
255,302
|
|
|
6.61
|
%
|
|
267,125
|
|
|
6.51
|
%
|
|
238,437
|
|
|
6.51
|
%
|
Indirect
automobile
|
1,673,014
|
|
|
3.08
|
%
|
|
1,771,665
|
|
|
3.02
|
%
|
|
1,645,641
|
|
|
2.92
|
%
|
Installment
loans and personal lines of credit
|
36,764
|
|
|
3.55
|
%
|
|
44,033
|
|
|
2.69
|
%
|
|
39,477
|
|
|
3.55
|
%
|
Residential
mortgage
|
877,080
|
|
|
4.14
|
%
|
|
912,700
|
|
|
4.15
|
%
|
|
704,937
|
|
|
3.81
|
%
|
Home equity
lines of credit
|
152,231
|
|
|
5.29
|
%
|
|
151,363
|
|
|
4.92
|
%
|
|
144,433
|
|
|
4.98
|
%
|
Total loans, net
of unearned income (1)
|
4,110,605
|
|
|
4.32
|
%
|
|
4,222,340
|
|
|
4.07
|
%
|
|
3,725,976
|
|
|
3.98
|
%
|
Investment securities
(1)
|
201,696
|
|
|
3.29
|
%
|
|
175,314
|
|
|
3.14
|
%
|
|
147,572
|
|
|
2.76
|
%
|
Other earning
assets
|
141,748
|
|
|
1.34
|
%
|
|
147,405
|
|
|
1.47
|
%
|
|
273,505
|
|
|
1.16
|
%
|
Total
interest-earning assets
|
4,454,049
|
|
|
4.18
|
%
|
|
4,545,059
|
|
|
3.95
|
%
|
|
4,147,053
|
|
|
3.75
|
%
|
Noninterest-earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from
banks
|
39,508
|
|
|
|
|
36,117
|
|
|
|
|
41,590
|
|
|
|
Allowance for loan
losses
|
(31,581)
|
|
|
|
|
(31,174)
|
|
|
|
|
(30,518)
|
|
|
|
Premises and
equipment, net
|
91,232
|
|
|
|
|
90,030
|
|
|
|
|
87,679
|
|
|
|
Other real
estate
|
7,221
|
|
|
|
|
7,383
|
|
|
|
|
9,111
|
|
|
|
Other
assets
|
242,360
|
|
|
|
|
243,119
|
|
|
|
|
224,730
|
|
|
|
Total
noninterest-earning assets
|
348,740
|
|
|
|
|
345,475
|
|
|
|
|
332,592
|
|
|
|
Total assets
|
$
|
4,802,789
|
|
|
|
|
$
|
4,890,534
|
|
|
|
|
$
|
4,479,645
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
$
|
463,292
|
|
|
0.13
|
%
|
|
$
|
489,051
|
|
|
0.14
|
%
|
|
$
|
447,348
|
|
|
0.12
|
%
|
Money market and
savings deposits
|
1,415,868
|
|
|
0.70
|
%
|
|
1,349,447
|
|
|
0.61
|
%
|
|
1,341,189
|
|
|
0.49
|
%
|
Time
deposits
|
918,668
|
|
|
1.30
|
%
|
|
906,133
|
|
|
1.16
|
%
|
|
1,021,563
|
|
|
0.92
|
%
|
Total
interest-bearing deposits
|
2,797,828
|
|
|
0.80
|
%
|
|
2,744,631
|
|
|
0.70
|
%
|
|
2,810,100
|
|
|
0.59
|
%
|
Other short-term
borrowings
|
169,128
|
|
|
1.92
|
%
|
|
395,215
|
|
|
1.84
|
%
|
|
20,899
|
|
|
0.32
|
%
|
Subordinated
debt
|
120,667
|
|
|
5.43
|
%
|
|
120,637
|
|
|
5.43
|
%
|
|
120,538
|
|
|
5.04
|
%
|
Total
interest-bearing liabilities
|
3,087,623
|
|
|
1.04
|
%
|
|
3,260,483
|
|
|
1.02
|
%
|
|
2,951,537
|
|
|
0.77
|
%
|
Noninterest-bearing liabilities and shareholders'
equity:
|
|
|
|
|
|
|
Demand
deposits
|
1,244,640
|
|
|
|
|
1,172,298
|
|
|
|
|
1,103,414
|
|
|
|
Other
liabilities
|
44,538
|
|
|
|
|
42,081
|
|
|
|
|
44,732
|
|
|
|
Shareholders'
equity
|
425,988
|
|
|
|
|
415,672
|
|
|
|
|
379,962
|
|
|
|
Total
noninterest-bearing liabilities and
shareholders' equity
|
1,715,166
|
|
|
|
|
1,630,051
|
|
|
|
|
1,528,108
|
|
|
|
Total liabilities and
shareholders' equity
|
$
|
4,802,789
|
|
|
|
|
$
|
4,890,534
|
|
|
|
|
$
|
4,479,645
|
|
|
|
Net interest
spread
|
|
|
3.14
|
%
|
|
|
|
2.93
|
%
|
|
|
|
2.98
|
%
|
Net interest
margin
|
|
|
3.45
|
%
|
|
|
|
3.22
|
%
|
|
|
|
3.20
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Interest income includes the effect of taxable-equivalent
adjustment using a 21% tax rate for the quarters ended September
30, 2018 and June 30, 2018 and a 35% tax rate for the quarter ended
September 30, 2017.
|
FIDELITY SOUTHERN
CORPORATION AND SUBSIDIARIES
GAAP TO NON-GAAP
RATIO RECONCILIATION
(UNAUDITED)
|
|
|
For the Quarter
Ended
|
($ in
thousands)
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
|
December 31,
2017
|
|
September 30,
2017
|
|
|
|
|
|
|
|
|
|
|
Reconciliation
of nonperforming assets to adjusted nonperforming
assets:
|
Nonperforming assets
(GAAP)
|
$
|
71,333
|
|
|
$
|
74,442
|
|
|
$
|
75,955
|
|
|
$
|
63,338
|
|
|
$
|
58,606
|
|
Less: repurchased
government-guaranteed mortgage
loans included on
nonaccrual
|
(27,218)
|
|
|
(27,220)
|
|
|
(26,091)
|
|
|
(19,478)
|
|
|
(15,450)
|
|
Less: SBA guaranteed
loans included on nonaccrual
|
(4,049)
|
|
|
(3,639)
|
|
|
(1,541)
|
|
|
(1,652)
|
|
|
(2,145)
|
|
Less: Nonaccrual
acquired loans
|
(7,388)
|
|
|
(7,648)
|
|
|
(7,890)
|
|
|
(6,242)
|
|
|
(7,366)
|
|
Adjusted
nonperforming assets, excluding acquired
loans and government-guaranteed loans
(non-GAAP)
|
$
|
32,678
|
|
|
$
|
35,935
|
|
|
$
|
40,433
|
|
|
$
|
35,966
|
|
|
$
|
33,645
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation
of total loans, ORE and repossessions to total loans, ORE and
repossessions, less acquired loans:
|
Loans, excluding
Loans Held-for-Sale
|
$
|
3,706,953
|
|
|
$
|
3,792,886
|
|
|
$
|
3,714,308
|
|
|
$
|
3,580,966
|
|
|
$
|
3,409,707
|
|
Add: ORE
|
8,031
|
|
|
6,834
|
|
|
7,668
|
|
|
7,621
|
|
|
8,624
|
|
Add:
repossessions
|
1,271
|
|
|
1,303
|
|
|
1,853
|
|
|
2,392
|
|
|
2,040
|
|
Total loans, ORE, and
repossessions (GAAP)
|
3,716,255
|
|
|
3,801,023
|
|
|
3,723,829
|
|
|
3,590,979
|
|
|
3,420,371
|
|
Less: acquired
loans
|
(150,763)
|
|
|
(165,303)
|
|
|
(178,496)
|
|
|
(196,567)
|
|
|
(216,994)
|
|
Adjusted loans, ORE,
and repossessions, less acquired
loans (non-GAAP)
|
$
|
3,565,492
|
|
|
$
|
3,635,720
|
|
|
$
|
3,545,333
|
|
|
$
|
3,394,412
|
|
|
$
|
3,203,377
|
|
Nonperforming assets
to loans, ORE, and
repossessions (GAAP)
|
1.92
|
%
|
|
1.96
|
%
|
|
2.04
|
%
|
|
1.76
|
%
|
|
1.71
|
%
|
Adjusted
nonperforming assets to adjusted loans,
ORE, and repossessions
(non-GAAP)
|
0.92
|
%
|
|
0.99
|
%
|
|
1.14
|
%
|
|
1.06
|
%
|
|
1.05
|
%
|
Nonperforming assets
to total assets (GAAP)
|
1.48
|
%
|
|
1.52
|
%
|
|
1.58
|
%
|
|
1.38
|
%
|
|
1.30
|
%
|
Adjusted
nonperforming assets to total assets (non-
GAAP)
|
0.68
|
%
|
|
0.73
|
%
|
|
0.84
|
%
|
|
0.79
|
%
|
|
0.75
|
%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation
of allowance to adjusted allowance:
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses (GAAP)
|
$
|
31,157
|
|
|
$
|
31,623
|
|
|
$
|
30,940
|
|
|
$
|
29,772
|
|
|
$
|
30,703
|
|
Less: allowance
allocated to indirect auto loans
|
(8,556)
|
|
|
(9,210)
|
|
|
(9,888)
|
|
|
(10,258)
|
|
|
(10,116)
|
|
Less: allowance
allocated to acquired loans
|
(134)
|
|
|
(134)
|
|
|
(134)
|
|
|
(209)
|
|
|
(159)
|
|
Adjusted allowance
for loan losses (non-GAAP)
|
$
|
22,467
|
|
|
$
|
22,279
|
|
|
$
|
20,918
|
|
|
$
|
19,305
|
|
|
$
|
20,428
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation
of period end loans to adjusted period end
loans:
|
Loans, excluding
Loans Held-for-Sale
|
$
|
3,706,953
|
|
|
$
|
3,792,886
|
|
|
$
|
3,714,308
|
|
|
$
|
3,580,966
|
|
|
$
|
3,409,707
|
|
Less: indirect auto
loans
|
(1,588,419)
|
|
|
(1,698,879)
|
|
|
(1,719,670)
|
|
|
(1,716,156)
|
|
|
(1,609,678)
|
|
Less: acquired
loans
|
(150,763)
|
|
|
(165,303)
|
|
|
(178,496)
|
|
|
(196,567)
|
|
|
(216,994)
|
|
Adjusted total loans
(non-GAAP)
|
$
|
1,967,771
|
|
|
$
|
1,928,704
|
|
|
$
|
1,816,142
|
|
|
$
|
1,668,243
|
|
|
$
|
1,583,035
|
|
Allowance to total
loans (GAAP)
|
0.84
|
%
|
|
0.83
|
%
|
|
0.83
|
%
|
|
0.83
|
%
|
|
0.90
|
%
|
Adjusted allowance to
adjusted total loans (non-
GAAP)
|
1.14
|
%
|
|
1.16
|
%
|
|
1.15
|
%
|
|
1.16
|
%
|
|
1.29
|
%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation
of book value per common share to tangible book value per common
share:
|
Shareholders'
equity
|
$
|
432,098
|
|
|
$
|
420,962
|
|
|
$
|
410,744
|
|
|
$
|
401,632
|
|
|
$
|
388,068
|
|
Less: intangible
assets
|
(11,474)
|
|
|
(11,751)
|
|
|
(12,028)
|
|
|
(12,306)
|
|
|
(12,625)
|
|
Tangible
shareholders' equity
|
$
|
420,624
|
|
|
$
|
409,211
|
|
|
$
|
398,716
|
|
|
$
|
389,326
|
|
|
$
|
375,443
|
|
End of period common
shares outstanding
|
27,260,681
|
|
|
27,191,787
|
|
|
27,034,255
|
|
|
27,019,201
|
|
|
26,815,287
|
|
Book value per common
share (GAAP)
|
$
|
15.85
|
|
|
$
|
15.48
|
|
|
$
|
15.19
|
|
|
$
|
14.86
|
|
|
$
|
14.47
|
|
Tangible book value
per common share (non-GAAP)
|
15.43
|
|
|
15.05
|
|
|
14.75
|
|
|
14.41
|
|
|
14.00
|
|
Contacts:
|
Martha Fleming,
Charles D. Christy
|
|
Fidelity Southern
Corporation (404) 240-1504
|
View original
content:http://www.prnewswire.com/news-releases/fidelity-southern-corporation-reports-earnings-for-third-quarter-of-12-7-million-300733793.html
SOURCE Fidelity Southern Corporation