Stonegate Bank (NASDAQ:SGBK) (“Stonegate”) reported net income of
$8.3 million for the second quarter of 2017 or $0.54 per diluted
common share ($0.59 per common share net operating income, a
non-GAAP measurement described below), as compared to net income of
$8.0 million for the first quarter of 2017 or $0.53 per diluted
common share.
Net operating income is a non-GAAP financial measurement used by
management to evaluate and monitor financial results of operations
and excludes certain activities or transactions, such as merger and
acquisition related expenses. Information related to our use
of non-GAAP financial measures and a table reconciling GAAP to
non-GAAP measures used in this press release are under the caption
Non-GAAP Financial Measures – Reconciliation of GAAP to non-GAAP
Measures.
Key highlights for the second quarter:
- Loans: Total loans, net of discounts and
deferred fees, declined $20.6 million during the second quarter of
2017 to $2.46 billion at June 30, 2017, a result of net loan
payoffs and principal reductions during the quarter.
Commercial real estate (“CRE”) comprised 46% of new loan
originations for the second quarter of 2017, based upon the
outstanding balance as of June 30, 2017. Residential loans
accounted for 33% of the new loan originations, commercial and
industrial (“C&I”) were 11% of the new loan originations; 8% of
the new originations were construction with the remaining balance
in consumer and other loans. The loan production for the
second quarter was comprised of 54% variable rate loans.
Approximately 69% of the variable rate loans originated in the
second quarter were tied to LIBOR.
- Asset Quality: Total loans past due,
excluding nonaccrual loans, were $1.4 million at June 30, 2017, a
decrease of $3.0 million from March 31, 2017. Nonaccrual
loans were $11.1 million at June 30, 2017, or 0.45% of total loans,
an increase from $9.1 million at March 31, 2017, or 0.37% of total
loans. Other real estate owned was $4.2 million at June 30,
2017, unchanged from March 31, 2017.
- Net Interest Income and Margin: Net
interest income, on a tax-equivalent basis, increased $864,000 for
the three months ended June 30, 2017 as compared to the three
months ended March 31, 2017. Net interest income totaled
$27.1 million for the three months ended June 30, 2017. The
net interest margin, on a tax-equivalent basis, decreased to 3.84%
for the second quarter of 2017 as compared to 3.91% for the first
quarter of 2017 and 3.97% for the quarter ended June 30,
2016. The decrease in the margin from the first quarter of
2017 to the second quarter of 2017 was primarily a result of a
decrease in the amount of accretion that was recognized during the
second quarter.
- Noninterest Expense: Noninterest expense
increased to $16.3 million for the three months ended June 30, 2017
from $15.1 million for the three months ended March 31, 2017.
The increase was due to the added expenses of Insignia Bank for a
full three months in the second quarter and $980,000 of costs
associated with both the Insignia Bank conversion in early June
2017 and our pending acquisition by Home BancShares, Inc.
- Capital: Stonegate remained
well-capitalized as of June 30, 2017 with capital of $417.8 million
as compared to $410.1 million at March 31, 2017. As of June
30, 2017, Stonegate’s total risk-based capital ratio was 12.5%;
Stonegate’s Tier 1 and Common Equity Tier 1 capital ratios were
each 11.5%; and Stonegate’s leverage capital ratio was
10.7%.
Loans and Deposits
Loans outstanding at June 30, 2017 were $2.46 billion as
compared to $2.48 billion at March 31, 2017, a decrease of $20.6
million during the second quarter of 2017.
The loan portfolio consists primarily of loans to individuals
and small- and medium-sized businesses within Stonegate’s primary
market areas of South and West Florida. The table below shows the
loan portfolio composition:
(in thousands of
dollars) |
|
June 30, 2017 |
|
March 31, 2017 |
|
|
|
|
|
|
|
Commercial |
|
$ |
312,147 |
|
$ |
322,453 |
Commercial real estate
- owner occupied |
|
|
522,915 |
|
|
549,740 |
Commercial real estate
- other |
|
|
789,352 |
|
|
779,116 |
Construction and land
development |
|
|
261,187 |
|
|
264,040 |
Residential real
estate |
|
|
472,367 |
|
|
457,933 |
Consumer and other
loans |
|
|
111,511 |
|
|
117,954 |
Credit Cards |
|
|
1,427 |
|
|
1,151 |
Total
loans |
|
|
2,470,906 |
|
|
2,492,387 |
Less: discount on loans
acquired |
|
|
7,168 |
|
|
8,216 |
Less: net deferred
fees |
|
|
3,373 |
|
|
3,233 |
Recorded investment in
loans |
|
|
2,460,365 |
|
|
2,480,938 |
Less: Allowance for
loan losses |
|
|
19,848 |
|
|
19,538 |
Net
loans |
|
$ |
2,440,517 |
|
$ |
2,461,400 |
New loan originations were $160.1 million during the second
quarter of 2017, with fundings of $111.1 million. As of June
30, 2017, outstanding commitments were approximately $504.6 million
with approximately $75.9 million representing new approved loan
originations and approximately $158.6 million in unfunded
construction commitments and approximately $13.9 in unfunded credit
card lines.
Total deposits decreased to $2.62 billion at June 30, 2017 from
$2.72 billion at March 31, 2017. Noninterest-bearing deposits
were $609.7 million at June 30, 2017, a decrease from $628.5
million at March 31, 2017, and represented approximately 23.2% of
total deposits.
The following table shows the composition of deposits as of June
30, 2017 and March 31, 2017:
(in thousands of
dollars) |
|
June 30, 2017 |
|
March 31, 2017 |
|
|
|
|
|
|
|
Noninterest
bearing |
|
$ |
609,656 |
|
$ |
628,497 |
NOW |
|
|
304,121 |
|
|
338,461 |
Money market |
|
|
1,384,598 |
|
|
1,401,763 |
Savings |
|
|
136,011 |
|
|
137,065 |
Certificates of
deposit |
|
|
188,681 |
|
|
215,153 |
Total
deposits |
|
$ |
2,623,067 |
|
$ |
2,720,939 |
Credit Quality and Allowance for Loan Losses
Loans past due 30-89 days were $1.3 million at June 30, 2017, a
decrease from $4.4 million at March 31, 2017. The decrease in
loans past due was primarily attributable to two loans, for a total
of $2.6 million, acquired from Florida Shores Bank – Southwest, and
two legacy loans for $587,000 which were transferred to nonaccrual
status. Past dues acquired in the Insignia Bank acquisition
totaled $337,000 at June 30, 2017. There was one loan from
the Regent Bank portfolio which was past due 90 days or more and
still accruing at June 30, 2017. There were no legacy loans
(i.e., loans made by Stonegate and not acquired by acquisition or
otherwise) which were past due at June 30, 2017. Nonaccrual
loans stood at $11.1 million at June 30, 2017, an increase from
$9.1 million at March 31, 2017. This increase was due
primarily to $3.1 million of new loans that were changed to
nonaccrual status during the second quarter, offset by two
nonaccrual loans for $669,000 which were paid off and five loans
for $365,000 which were charged-off. Legacy nonaccrual loans were
approximately $2.9 million at June 30, 2017 versus $2.8 million as
of March 31, 2017. Residential loans classified as nonaccrual
were $2.6 million or 23.5% of the nonaccrual loans and commercial
real estate loans classified as nonaccrual were $3.9 million or
34.8% of the nonaccrual loans as of June 30, 2017. At June
30, 2017, there remained approximately $13.8 million in
nonaccretable discounts on loans previously acquired. None of
the acquired loans are subject to a loss share arrangement with the
Federal Deposit Insurance Corporation. The following table
outlines Stonegate’s past due and nonaccrual loans at June 30,
2017:
(dollars in
thousands) |
|
Legacy Loans |
|
Insignia Bank |
|
Regent Bank |
|
Other AcquiredBanks |
|
Total |
Past due 30-89
days |
|
$ |
- |
|
$ |
337 |
|
$ |
656 |
|
$ |
307 |
|
$ |
1,300 |
Past due 90 + days |
|
|
- |
|
|
- |
|
|
129 |
|
|
- |
|
|
129 |
Nonaccrual |
|
|
2,909 |
|
|
- |
|
|
3,540 |
|
|
4,674 |
|
|
11,123 |
Total |
|
$ |
2,909 |
|
$ |
337 |
|
$ |
4,325 |
|
$ |
4,981 |
|
$ |
12,552 |
Nonperforming assets (nonaccrual loans and other real estate
owned) were $15.3 million as of June 30, 2017, an increase of $2.0
million from March 31, 2017. Other real estate owned (“OREO”)
was virtually unchanged at June 30, 2017 as compared to March 31,
2017.
The following table outlines nonperforming assets for the
periods ended:
(in thousands of
dollars) |
|
June 30, 2017 |
|
March 31, 2017 |
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual |
|
$ |
11,123 |
|
$ |
9,058 |
|
Other real estate
owned |
|
|
4,211 |
|
|
4,222 |
|
Total
nonperforming assets |
|
$ |
15,334 |
|
$ |
13,280 |
|
|
|
|
|
|
|
Nonperforming loans as
a percentage of total loans |
|
|
0.45% |
|
|
0.37% |
|
Nonperforming assets as
a percentage of total assets |
|
|
0.49% |
|
|
0.41% |
|
Loans modified as troubled debt restructuring were $10.5 million
and $9.4 million at June 30, 2017 and March 31, 2017,
respectively. There were four loans modified as troubled debt
restructuring during the second quarter of 2017. Specific
reserves allocated to loans modified as troubled debt restructuring
decreased to $145,000 at June 30, 2017, from $161,000 at March 31,
2017.
At June 30, 2017, the allowance for loan losses was $19.8
million, an increase of $310,000 from March 31, 2017. During
the second quarter of 2017 recoveries totaled $104,000, charge-offs
were $394,000 and we added provision expense of $600,000. The
provision expense added for the second quarter was due to an
increase in charged off loans and to the continued seasoning of the
acquired loan portfolios. Specific reserves decreased to $757,000
at June 30, 2017 from $1.0 million at March 31, 2017. The
allowance for loan losses represented 0.81% of total loans as of
June 30, 2017 and 0.79% as of March 31, 2017. Additionally,
as of June 30, 2017, the allowance represented 1.02% of total loans
which are currently being reserved for.
The following table shows the activity in the allowance for loan
losses for the quarters ended:
(in thousands of
dollars) |
|
June 30,2017 |
|
March 31,2017 |
|
|
|
|
|
Balance at beginning of
period |
|
$ |
19,538 |
|
|
$ |
18,888 |
|
Charge-offs |
|
|
(394 |
) |
|
|
(118 |
) |
Recoveries |
|
|
104 |
|
|
|
168 |
|
Provision for loan
losses |
|
|
600 |
|
|
|
600 |
|
Balance at end of
period |
|
$ |
19,848 |
|
|
$ |
19,538 |
|
The table below reflects the allowance allocation per loan
category and percent of loans in each category to total loans for
the periods indicated:
|
|
June 30,2017 |
|
March 31,2017 |
(in thousands of
dollars) |
|
|
|
|
Amount |
|
% |
|
Amount |
|
% |
Commercial |
|
$ |
2,903 |
|
14.6 |
|
$ |
2,915 |
|
14.9 |
Commercial real
estate |
|
|
12,042 |
|
60.7 |
|
|
11,742 |
|
60.1 |
Construction and land
development |
|
|
1,983 |
|
10.0 |
|
|
1,913 |
|
9.8 |
Residential real
estate |
|
|
2,458 |
|
12.4 |
|
|
2,491 |
|
12.8 |
Consumer and other
loans |
|
|
462 |
|
2.3 |
|
|
477 |
|
2.4 |
Total |
|
$ |
19,848 |
|
100.0 |
|
$ |
19,538 |
|
100.0 |
The following is a summary of information pertaining to impaired
loans for the three months ended on the date indicated:
(in thousands of
dollars) |
|
June 30,2017 |
|
March 31,2017 |
|
June 30,2016 |
|
|
|
|
|
|
|
|
|
|
Impaired loans without
a valuation allowance |
|
$ |
14,982 |
|
$ |
7,986 |
|
$ |
6,637 |
Impaired loans with a
valuation allowance |
|
|
7,667 |
|
|
7,975 |
|
|
5,644 |
Total impaired
loans |
|
$ |
22,649 |
|
$ |
15,961 |
|
$ |
12,281 |
|
|
|
|
|
|
|
|
|
|
Valuation allowance
related to impaired loans |
|
$ |
757 |
|
$ |
1,024 |
|
$ |
611 |
Net Interest Income and MarginOn a
tax-equivalent basis, Stonegate’s net interest income for the three
months ended June 30, 2017 was $27.1 million, an increase of
approximately $864,000 from the first quarter of 2017 and an
increase of $5.1 million from the second quarter 2016.
Average earning assets grew $114.4 million from the first quarter
of 2017 to the second quarter of 2017, primarily a result of the
increase in the assets acquired from Insignia Bank, which occurred
on March 7, 2017. The yield on loans decreased from 5.00% for
the first quarter of 2017 to 4.85% for the second quarter of 2017,
which was also a decrease from the 5.00% yield for the second
quarter of 2016. The decrease in the loan yield in the second
quarter was due to the decrease in nonaccretable discounts,
associated with loan payoffs, recognized in the second quarter of
2017 over the first quarter of 2017.
The net interest margin on a tax-equivalent basis decreased from
3.91% for the first quarter of 2017 to 3.84% for the second quarter
of 2017. The net interest margin was 3.97% for the second
quarter of 2016. The average yield on total earning assets
was 4.37% for the second quarter of 2017 versus 4.43% for the first
quarter of 2017. The average yield on paying liabilities
increased four basis points from 0.69% from the first quarter of
2017 to 0.73% for the second quarter of 2017. Stonegate’s
cost of funds has increased from 0.48% for the June 2016
month-to-date average to 0.59% for the June 2017 month-to-date
average.
The following table recaps yields and costs by various
interest-earning asset and interest-bearing liability account types
for the current quarter, the previous quarter and the same quarter
last year.
Yield and cost table (unaudited) |
(in
thousands of dollars) |
|
|
|
|
|
|
|
|
2nd Quarter 2017 |
|
1st Quarter 2017 |
|
2nd Quarter 2016 |
|
|
AverageBalance |
|
Interest |
|
Rate |
|
AverageBalance |
|
Interest |
|
Rate |
|
AverageBalance |
|
Interest |
|
Rate |
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans,
Net(1)(2)(4) |
|
$ |
2,462,579 |
|
$ |
29,763 |
|
4.85 |
% |
|
$ |
2,323,075 |
|
$ |
28,648 |
|
5.00 |
% |
|
$ |
1,909,961 |
|
$ |
23,754 |
|
5.00 |
% |
Investment Securities |
|
|
111,465 |
|
|
385 |
|
1.39 |
|
|
|
117,985 |
|
|
483 |
|
1.66 |
|
|
|
109,352 |
|
|
441 |
|
1.62 |
|
Federal
Funds Sold |
|
|
30,000 |
|
|
91 |
|
1.22 |
|
|
|
30,000 |
|
|
68 |
|
0.92 |
|
|
|
30,000 |
|
|
53 |
|
0.71 |
|
Other
Investments(3) |
|
|
4,666 |
|
|
56 |
|
4.81 |
|
|
|
4,068 |
|
|
46 |
|
4.59 |
|
|
|
3,049 |
|
|
35 |
|
4.62 |
|
Deposits
with interest at banks |
|
|
229,307 |
|
|
640 |
|
1.12 |
|
|
|
248,528 |
|
|
531 |
|
0.87 |
|
|
|
178,622 |
|
|
233 |
|
0.52 |
|
Total
Earning Assets |
|
|
2,838,017 |
|
|
30,935 |
|
4.37 |
% |
|
|
2,723,656 |
|
|
29,776 |
|
4.43 |
% |
|
|
2,230,984 |
|
|
24,516 |
|
4.42 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings,
NOW and Money Market |
|
$ |
1,801,783 |
|
$ |
3,076 |
|
0.68 |
% |
|
$ |
1,795,495 |
|
$ |
2,823 |
|
0.64 |
% |
|
$ |
1,486,766 |
|
$ |
2,067 |
|
0.56 |
% |
Time
Deposits |
|
|
201,982 |
|
|
265 |
|
0.53 |
|
|
|
183,091 |
|
|
263 |
|
0.58 |
|
|
|
147,830 |
|
|
206 |
|
0.56 |
|
Total
Interest Bearing Deposits |
|
|
2,003,765 |
|
|
3,341 |
|
0.67 |
|
|
|
1,978,586 |
|
|
3,086 |
|
0.63 |
|
|
|
1,634,596 |
|
|
2,273 |
|
0.56 |
|
Other
Borrowings |
|
|
82,647 |
|
|
448 |
|
2.17 |
|
|
|
81,115 |
|
|
408 |
|
2.04 |
|
|
|
57,767 |
|
|
215 |
|
1.50 |
|
Total
Interest Bearing Liabilities |
|
|
2,086,412 |
|
|
3,789 |
|
0.73 |
% |
|
|
2,059,701 |
|
|
3,494 |
|
0.69 |
% |
|
|
1,692,363 |
|
|
2,488 |
|
0.59 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
interest spread (tax- equivalent basis) (4) |
|
|
|
|
|
|
|
|
|
|
|
3.64 |
% |
|
|
|
|
|
|
|
3.74 |
% |
|
|
|
|
|
|
|
3.83 |
% |
Net
interest margin (tax-equivalent basis) (5) |
|
|
|
|
|
|
|
|
|
|
|
3.84 |
% |
|
|
|
|
|
|
|
3.91 |
% |
|
|
|
|
|
|
|
3.97 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Average balances include nonaccrual loans, and are
net of unearned loan fees of $3,187, $3,239 and $3,101 for 2nd
Quarter 2017, 1st Quarter 2017 and 2nd Quarter 2016, respectively.
(2) Interest income includes fees on loans of $70, $60 and $32 for
2nd Quarter 2017, 1st Quarter 2017 and 2nd Quarter 2016,
respectively. (3) “Other investments” consists of equity stock in
the Federal Home Loan Bank of Atlanta (“FHLB”) that Stonegate is
required to own based on its transactions with the FHLB.(4)
Interest income and rates include the effects of a tax equivalent
adjustment using applicable statutory tax rates to adjust tax
exempt interest income on tax exempt loans to a fully taxable
basis.(5) Represents net interest income divided by total
interest-earning assets. |
Noninterest Income
Noninterest income of $2.9 million for the second quarter of
2017 increased from $2.1 million for the quarter ended March 31,
2017. The increase in the second quarter was primarily due to
$366,000 in loan prepayment fees that were collected, $196,000 in
interest swap fees and approximately $170,000 net gain on the sale
of a former Regent Bank banking office.
Noninterest Expense
Noninterest expense for the three months ended June 30, 2017
increased to $16.3 million from $15.1 million at March 31, 2017,
and from $12.8 million for the three months ended June 30,
2016.
Salaries and employee benefits increased to $8.8 million for the
second quarter of 2017 versus $8.4 million for the first quarter of
2017. This compares with $6.9 million for the three months
ended June 30, 2016. The increase in salaries and employee
benefits in the second quarter of 2017 from the first quarter of
2017 were from the staff added with the Insignia Bank acquisition
in March 2017, both permanent and temporary, as well as payments
made in the second quarter for the Insignia Bank conversion.
Occupancy and equipment expenses increased to $2.5 million for
the three months ended June 30, 2017 from $2.3 million for the
quarter ended March 31, 2017. Occupancy and equipment
expenses were $2.1 million for the three months June 30,
2016. Expenses for merger-related branch closures were
approximately $200,000 during the second quarter of 2017.
Data processing expenses increased $447,000 from $478,000 for
the first quarter of 2017 to $925,000 for the quarter ended June
30, 2017. Approximately $356,000 million of data processing
expenses in the second quarter were related to the Insignia Bank
data conversion. Professional fees for the three months ended
June 30, 2017 were $994,000. This compared to professional
fees of $1.4 million for the three months ended March 31, 2017 and
$954,000 for the three months ended June 30, 2016. During the
second quarter of 2017, there was $203,000 in legal and other
professional fees for merger-related expenses as compared to
$583,000 in the first quarter of 2017 and $334,000 in the second
quarter of 2016.
The table below outlines the expenses for the quarters
ended:
|
|
June 30, 2017 |
|
March 31, 2017 |
|
June 30, 2016 |
(in thousands of
dollars) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits |
|
$ |
8,770 |
|
$ |
8,411 |
|
$ |
6,907 |
Occupancy and equipment
expense |
|
|
2,469 |
|
|
2,264 |
|
|
2,158 |
FDIC insurance and
state assessments |
|
|
406 |
|
|
398 |
|
|
284 |
Data processing |
|
|
925 |
|
|
478 |
|
|
447 |
Loan and other real
estate expense |
|
|
590 |
|
|
201 |
|
|
102 |
Professional fees |
|
|
994 |
|
|
1,352 |
|
|
954 |
Core deposit intangible
amortization |
|
|
575 |
|
|
463 |
|
|
408 |
Other operating
expenses |
|
|
1,596 |
|
|
1,551 |
|
|
1,540 |
Totals |
|
$ |
16,325 |
|
$ |
15,118 |
|
$ |
12,800 |
Looking forward to the third quarter of 2017, Stonegate
anticipates additional costs associated with the pending merger
with Home Bancshares, Inc. and Centennial Bank.
About Stonegate Bank
Stonegate Bank is a full-service commercial bank, providing a
wide range of business and consumer financial products and services
through its 24 banking offices in its target marketplaces of South
and West Florida, which are comprised primarily of Broward,
Charlotte, Collier, Hillsborough, Lee, Miami-Dade, Palm Beach and
Sarasota Counties in Florida. Stonegate’s principal executive
office and mailing address is 400 North Federal Highway, Pompano
Beach, Florida 33062 and its telephone number is (954)
315-5500.
There will not be a conference call held this quarter to discuss
the second quarter results.
Forward-Looking Statements
Any non-historical statements in this press release are
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements are based on current plans and expectations that are
subject to uncertainties and risks, which could cause our future
results to differ materially. The following factors, among others,
could cause our actual results to differ: the strength of the
United States economy in general and the strength of the local
economies in which we conduct operations; our need and ability to
incur additional debt or equity financing; our ability to execute
our growth strategy through expansion; our ability to comply with
the extensive laws and regulations to which we are subject; changes
in the securities and capital markets; changes in general market
interest rates; legislative and regulatory changes; monetary and
fiscal policies of the U.S. Treasury and the Federal Reserve;
changes in the quality or composition of our loan portfolios;
demand for loan products; changes in deposit flows, real estate
values, and competition and other economic, competitive, and
technological factors affecting our operations, pricing, products
and services; and our ability to manage the risks involved in the
foregoing. Additional factors can be found in our filings with the
FDIC, which are available at the FDIC’s internet site
(http://www2.fdic.gov/efr). Forward-looking statements in this
press release speak only as of the date of the press release and
Stonegate Bank assumes no obligation to update any forward-looking
statements or the reasons why actual results could differ.
|
Stonegate Bank and SubsidiariesCONDENSED CONSOLIDATED
BALANCE SHEETS (unaudited) (in thousands of dollars, except per
share data) |
|
|
|
June 30, 2017 |
|
December 31, 2016 |
Assets |
|
|
|
|
|
|
Cash and due from
banks |
|
$ |
325,314 |
|
|
$ |
305,803 |
|
Federal funds sold |
|
|
30,000 |
|
|
|
30,000 |
|
Securities held to
maturity (Fair value of $109,132 at June 30, 2017 and $116,719 at
December 31, 2016) |
|
|
108,803 |
|
|
|
116,529 |
|
Other investments |
|
|
4,601 |
|
|
|
3,833 |
|
Loans, net of allowance
for loan losses of $19,848 at June 30, 2017 and $18,888 at December
31, 2016 |
|
|
2,440,517 |
|
|
|
2,256,048 |
|
Premises and equipment,
net |
|
|
34,633 |
|
|
|
38,510 |
|
Bank premises held for
sale |
|
|
4,872 |
|
|
|
- |
|
Bank-owned life
insurance |
|
|
47,729 |
|
|
|
44,011 |
|
Other real estate
owned |
|
|
4,211 |
|
|
|
2,792 |
|
Other assets |
|
|
132,508 |
|
|
|
104,076 |
|
Total
assets |
|
$ |
3,133,188 |
|
|
$ |
2,901,602 |
|
|
|
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Total
deposits |
|
$ |
2,623,067 |
|
|
$ |
2,447,826 |
|
Other
borrowings |
|
|
68,146 |
|
|
|
71,448 |
|
Subordinated Debentures |
|
|
8,289 |
|
|
|
8,175 |
|
Other
liabilities |
|
|
15,861 |
|
|
|
19,040 |
|
Total
liabilities |
|
|
2,715,363 |
|
|
|
2,546,489 |
|
|
|
|
|
|
|
|
Stockholders’
Equity |
|
|
|
|
|
|
Common
stock, $5 par value, 20,000,000 shares authorized; 15,222,546
issued and 15,319,888 shares outstanding as of June 30,
2017 and 14,267,451 shares issued and 14,264,793 outstanding as of
December 31, 2016 |
|
|
76,613 |
|
|
|
71,337 |
|
Additional paid-in capital |
|
|
230,388 |
|
|
|
186,948 |
|
Retained
earnings |
|
|
111,683 |
|
|
|
97,814 |
|
Treasury
Stock |
|
|
(13 |
) |
|
|
(13 |
) |
Accumulated other comprehensive income (loss) |
|
|
(846 |
) |
|
|
(973 |
) |
Total stockholders’ equity |
|
|
417,825 |
|
|
|
355,113 |
|
Total
liabilities and stockholders’ equity |
|
$ |
3,133,188 |
|
|
$ |
2,901,602 |
|
|
Stonegate Bank and SubsidiariesCONDENSED CONSOLIDATED
STATEMENTS OF EARNINGS (unaudited) (in thousands of dollars, except
per share data) |
|
|
|
For the three months ended |
|
|
June 30,2017 |
|
March 31, 2017 |
|
June 30, 2016 |
Interest
income: |
|
|
|
|
|
|
|
|
|
Interest and fees on loans |
|
$ |
29,381 |
|
$ |
28,253 |
|
$ |
23,314 |
Interest on securities |
|
|
385 |
|
|
483 |
|
|
441 |
Interest on federal funds sold and at other banks |
|
|
731 |
|
|
599 |
|
|
286 |
Other interest |
|
|
56 |
|
|
46 |
|
|
35 |
Total interest income |
|
|
30,553 |
|
|
29,381 |
|
|
24,076 |
|
|
|
|
|
|
|
|
|
|
Interest
expense: |
|
|
|
|
|
|
|
|
|
Interest on deposits |
|
|
3,341 |
|
|
3,086 |
|
|
2,273 |
Other interest |
|
|
448 |
|
|
408 |
|
|
215 |
Total interest expense |
|
|
3,789 |
|
|
3,494 |
|
|
2,488 |
Net interest income |
|
|
26,764 |
|
|
25,887 |
|
|
21,588 |
Provision for loan losses |
|
|
600 |
|
|
600 |
|
|
- |
Net interest income after |
|
|
|
|
|
|
|
|
|
provision for loan losses |
|
|
26,164 |
|
|
25,287 |
|
|
21,588 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest
income: Service charges and fees on deposit accounts |
|
786 |
846 |
|
|
632 |
Other
noninterest income |
|
|
2,132 |
|
|
1,231 |
|
|
1,113 |
Total noninterest income |
|
|
2,918 |
|
|
2,077 |
|
|
1,745 |
Noninterest
expense: |
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
|
8,770 |
|
|
8,411 |
|
|
6,907 |
Occupancy and equipment expenses |
|
|
2,469 |
|
|
2,264 |
|
|
2,158 |
Data processing |
|
|
925 |
|
|
478 |
|
|
447 |
Professional fees |
|
|
994 |
|
|
1,352 |
|
|
954 |
Core deposit intangible amortization |
|
|
575 |
|
|
463 |
|
|
408 |
Other operating expenses |
|
|
2,592 |
|
|
2,150 |
|
|
1,926 |
Total noninterest expense |
|
|
16,325 |
|
|
15,118 |
|
|
12,800 |
Income before income taxes |
|
|
12,757 |
|
|
12,246 |
|
|
10,533 |
Income tax |
|
|
4,433 |
|
|
4,252 |
|
|
3,616 |
Net income applicable to common
stock |
|
$ |
8,324 |
|
$ |
7,994 |
|
$ |
6,917 |
Earnings
per common share: |
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.54 |
|
$ |
0.55 |
|
$ |
0.54 |
Diluted |
|
|
0.53 |
|
|
0.53 |
|
|
0.52 |
Common
shares used in the calculation of earnings per share: |
|
|
|
|
|
|
|
|
|
Basic |
|
|
15,318,219 |
|
|
14,558,233 |
|
|
12,825,612 |
Diluted |
|
|
15,809,027 |
|
|
15,090,775 |
|
|
13,189,982 |
|
Stonegate Bank and SubsidiariesCONDENSED FINANCIAL
HIGHLIGHTS(in thousands of dollars) |
|
|
|
As of |
|
|
|
June 30, 2017 |
|
|
|
December 31, 2016 |
|
|
|
June 30, 2016 |
|
BALANCE SHEET
ITEMS: |
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
$ |
3,133,188 |
|
|
$ |
2,901,602 |
|
|
$ |
2,404,139 |
|
Loans, net |
|
|
2,440,517 |
|
|
|
2,256,048 |
|
|
|
1,945,517 |
|
Deposits |
|
|
2,623,067 |
|
|
|
2,447,826 |
|
|
|
2,034,212 |
|
Stockholders’
equity |
|
|
417,825 |
|
|
|
355,113 |
|
|
|
296,961 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL RATIOS: |
|
|
|
|
|
|
|
|
|
|
|
|
Total capital to risk
weighted assets |
|
|
12.5 |
% |
|
|
12.1 |
% |
|
|
12.0 |
% |
Tier 1 capital to risk
weighted assets |
|
|
11.5 |
|
|
|
11.1 |
|
|
|
11.1 |
|
Common Equity Tier 1 to
risk weighted assets |
|
|
11.5 |
|
|
|
11.1 |
|
|
|
11.1 |
|
Tier 1 capital to
average assets |
|
|
10.7 |
|
|
|
10.0 |
|
|
|
10.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
QUARTERLY AVERAGE
BALANCE SHEET ITEMS: |
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
$ |
3,131,269 |
|
|
$ |
2,948,409 |
|
|
$ |
2,430,820 |
|
Interest earning
assets |
|
|
2,838,017 |
|
|
|
2,687,990 |
|
|
|
2,230,934 |
|
Loans, net of allowance
for loan losses |
|
|
2,443,090 |
|
|
|
2,279,629 |
|
|
|
1,891,500 |
|
Interest bearing
liabilities |
|
|
2,086,412 |
|
|
|
2,023,913 |
|
|
|
1,692,363 |
|
Deposits |
|
|
2,616,478 |
|
|
|
2,499,516 |
|
|
|
2,060,687 |
|
Stockholders’
equity |
|
|
415,979 |
|
|
|
351,730 |
|
|
|
294,362 |
|
|
Stonegate Bank and SubsidiariesCONDENSED FINANCIAL
HIGHLIGHTS(in thousands of dollars, except per share data) |
|
|
|
|
|
|
Three Months Ended |
|
|
|
June 30, 2017 |
|
|
|
March 31, 2017 |
|
|
|
June 30, 2016 |
FINANCIAL DATA: |
|
|
|
|
|
|
|
|
|
|
|
Net interest
income |
|
$ |
26,764 |
|
|
$ |
25,887 |
|
|
$ |
21,588 |
Net interest income –
tax-equivalent |
|
|
27,146 |
|
|
|
26,282 |
|
|
|
22,028 |
Noninterest income |
|
|
2,918 |
|
|
|
2,077 |
|
|
|
1,745 |
Noninterest
expense |
|
|
16,325 |
|
|
|
15,118 |
|
|
|
12,800 |
Income tax |
|
|
4,433 |
|
|
|
4,252 |
|
|
|
3,616 |
Net income attributed
to common shares |
|
|
8,324 |
|
|
|
7,994 |
|
|
|
6,917 |
Weighted average number
of common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
15,318,219 |
|
|
|
14,558,233 |
|
|
|
12,825,612 |
Diluted |
|
|
15,809,027 |
|
|
|
15,090,775 |
|
|
|
13,189,982 |
Per common share
data: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.54 |
|
|
$ |
0.55 |
|
|
$ |
0.54 |
Diluted |
|
|
0.53 |
|
|
|
0.53 |
|
|
|
0.52 |
Cash dividend declared
to common shares |
|
|
1,226 |
|
|
|
1,224 |
|
|
|
1,028 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial MeasuresThis press release
contains financial information determined by methods other than in
accordance with GAAP. Stonegate’s management uses these non-GAAP
financial measures in their analysis of Stonegate’s performance.
These measures typically adjust GAAP performance measures to
exclude the effects of the amortization of intangibles and include
the tax benefit associated with revenue items that are tax-exempt,
as well as adjust income available to common shareholders for
certain significant activities or transactions that in management’s
opinion can distort period-to-period comparisons of Stonegate’s
performance. Since the presentation of these GAAP performance
measures and their impact differ between companies, management
believes presentations of these non-GAAP financial measures provide
useful supplemental information that is essential to a proper
understanding of the operating results of Stonegate’s core
business. These non-GAAP 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. Reconciliations
of GAAP to non-GAAP disclosures in this press release are set forth
below.
Reconciliation of GAAP to non-GAAP Measures(in thousands of
dollars, except per share data)
|
|
|
June 30, 2017 |
|
March 31, 2017 |
Interest income, as
reported (GAAP) |
|
$ |
30,553 |
$ |
29,381 |
Tax-equivalents
adjustments |
|
|
382 |
|
395 |
Interest income (tax
equivalent) |
|
$ |
30,935 |
$ |
29,776 |
Net interest income, as
reported (GAAP) |
|
$ |
26,764 |
$ |
25,887 |
Tax-equivalent
adjustments |
|
|
382 |
|
395 |
Net interest income
(tax equivalent) |
|
$ |
27,146 |
$ |
26,282 |
Net income (GAAP) |
|
$ |
8,324 |
$ |
7,994 |
Non-interest expense
adjustments: |
|
|
|
|
|
Merger and acquisition
related expenses |
|
|
577 |
|
16 |
Branch closure
expenses |
|
|
200 |
|
- |
Professional
expenses |
|
|
203 |
|
583 |
Tax effect using the
effective tax rate for the period presented |
|
|
341 |
|
208 |
Net operating
income |
|
$ |
8,963 |
$ |
8,385 |
|
|
|
|
|
|
Net operating income
per common share |
|
$ |
0.59 |
$ |
0.58 |
|
|
|
|
|
|
INVESTOR RELATIONS:
Dave Seleski (dseleski@stonegatebank.com)
Stonegate Bank
(954) 315-5510
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