ServisFirst Bancshares, Inc. Announces Results For Third Quarter Of 2016

Montag, 17.10.2016 22:05 von

PR Newswire

BIRMINGHAM, Ala., Oct. 17, 2016 /PRNewswire/ -- ServisFirst Bancshares, Inc. (NASDAQ: SFBS), today announced earnings and operating results for the quarter and nine months ended September 30, 2016.

THIRD QUARTER 2016 HIGHLIGHTS:

  • Diluted EPS of $0.78 for third quarter of 2016, a 28% increase year over year
  • Net income of $59.7 million and diluted EPS of $2.23 for the nine months ended September 30, 2016
  • Core diluted EPS* for the nine months ended September 30, 2016 increased 30% year over year as 2015 results were impacted by acquisition expenses
  • Loans and deposits increased 15% and 26%, respectively, year over year
  • Loans and deposits increased 10% and 36%, respectively, for the third quarter on an annualized basis

*Core measures exclude non-routine expenses during the comparative periods presented in this press release as more fully described in "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" below.

Tom Broughton, President and CEO, said, "We are pleased to report a solid quarter of growth in net income, loans and deposits with excellent credit quality."  Bud Foshee, CFO, stated, "Net income in our Nashville, Tennessee region has continued to grow and net operating losses in our newer regions in Atlanta, Georgia, Charleston, South Carolina and Tampa Bay, Florida decreased in the third quarter."


FINANCIAL SUMMARY (UNAUDITED)

(in Thousands except share and per share amounts)






Period Ending September 30, 2016


Period Ending June 30, 2016


% Change
From Period
Ending June
30, 2016 to
Period Ending
September 30,
2016


Period Ending September 30,
2015


% Change
From Period
Ending
September 30,
2015 to Period
Ending
September 30,
2016


QUARTERLY OPERATING RESULTS




















Net Income


$

20,909



$

18,876



11

%


$

16,266



29

%


Net Income Available to Common Stockholders


$

20,909



$

18,853



11

%


$

16,233



29

%


Diluted Earnings Per Share


$

0.78



$

0.71



10

%


$

0.61



28

%


Return on Average Assets



1.39

%



1.37

%






1.38

%





Return on Average Common Stockholders' Equity



16.66

%



15.79

%






15.52

%





Average Diluted Shares Outstanding



26,939,664




26,726,284







26,506,334




























YEAR-TO-DATE OPERATING RESULTS




















Net Income


$

59,741



$

38,832






$

43,790



36

%


Net Income Available to Common Stockholders


$

59,718



$

38,809






$

43,534



37

%


Diluted Earnings Per Share


$

2.23



$

1.46






$

1.65



35

%


Return on Average Assets



1.43

%



1.45

%






1.32

%





Return on Average Common Stockholders' Equity



16.60

%



16.57

%






14.40

%





Average Diluted Shares Outstanding



26,744,959




26,646,547







26,391,100




























Core Net Income*


$

59,741










$

45,557



31

%


Core Net Income Available to Common Stockholders*


$

59,718










$

45,301



32

%


Core Diluted Earnings Per Share*


$

2.23










$

1.72



30

%


Core Return on Average Assets*



1.43

%










1.37

%





Core Return on Average Common Stockholders' Equity*



16.60

%










14.99

%



























BALANCE SHEET




















Total Assets


$

6,002,621



$

5,646,055



6

%


$

4,772,601



26

%


Loans



4,657,284




4,539,338



3

%



4,044,242



15

%


Non-interest-bearing Demand Deposits



1,269,726




1,185,668



7

%



1,029,354



23

%


Total Deposits



5,081,128




4,664,795



9

%



4,044,634



26

%


Stockholders' Equity



507,866




489,097



4

%



431,194



18

%
























* Core measures exclude non-routine expenses during the comparative periods presented in this press release as more fully described in "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" below.


 

DETAILED FINANCIALS

ServisFirst Bancshares, Inc. reported net income and net income available to common stockholders of $20.9 million for the quarter ended September 30, 2016, compared to net income of $16.3 million and net income available to common stockholders of $16.2 million for the same quarter in 2015.  Basic and diluted earnings per common share were $0.80 and $0.78, respectively, for the third quarter of 2016, compared to $0.63 and $0.61, respectively, for the third quarter of 2015.

Return on average assets was 1.39% and return on average equity was 16.66% for the third quarter of 2016, compared to 1.38% and 15.52%, respectively, for the third quarter of 2015.

Net interest income was $47.9 million for the third quarter of 2016, compared to $45.9 million for the second quarter of 2016 and $41.9 million for the third quarter of 2015.  The increase in net interest income on a linked quarter basis is attributable to a $164.0 million increase in average loans outstanding, a $107.6 million increase in non-interest-bearing deposits and a $20.0 million increase in average stockholders' equity and other liabilities, all resulting in a positive mix change in our balance sheet.  The average yield on loans increased one basis point to 4.48% on a linked quarter basis.  The net interest margin in the third quarter of 2016 was 3.35%, a 16 basis point decrease from the second quarter of 2016 and 42 basis point decrease from the third quarter of 2015.  The decrease in the net interest margin is primarily the result of excess liquidity in the form of large amounts in federal funds sold and funds on deposit at the Federal Reserve Bank.  Average balances in these accounts increased $269.8 million on a linked quarter basis and $614.4 million when compared to the third quarter of 2015.

Average loans for the third quarter of 2016 were $4.59 billion, an increase of $164.0 million, or 4%, over average loans of $4.42 billion for the second quarter of 2016, and an increase of $660.8 million, or 17%, over average loans of $3.93 billion for the third quarter of 2015.

Average total deposits for the third quarter of 2016 were $4.98 billion, an increase of $501.9 million, or 11%, over average total deposits of $4.48 billion for the second quarter of 2016, and an increase of $1.06 billion, or 27%, over average total deposits of $3.92 billion for the third quarter of 2015.

Non-performing assets to total assets were 0.16% for the third quarter of 2016, a decrease of one basis point compared to 0.17% for the second quarter of 2016 and a decrease of 18 basis points compared to 0.34% for the third quarter of 2015.  Net credit charge-offs to average loans were 0.13%, a 5 basis point decrease compared to 0.18% for the second quarter of 2016 and an eight basis point increase compared to 0.05% for the third quarter of 2015.  We recorded a $3.5 million provision for loan losses in the third quarter of 2016 compared to $3.8 million in the second quarter of 2016 and $3.1 million in the third quarter of 2015.  The allowance for loan loss as a percentage of total loans increased one basis point to 1.05% at September 30, 2016, compared to 1.04% at June 30, 2016 and was flat compared to 1.05% at September 30, 2015.  In management's opinion, the allowance is adequate and was determined by consistent application of ServisFirst Bank's methodology for calculating its allowance for loan losses.

Non-interest income increased $1.1 million during the third quarter of 2016, or 28%, compared to the third quarter of 2015.  Mortgage banking revenue increased by $239,000 in the third quarter of 2016, or 27%, compared to the third quarter of 2015, resulting from improved operations, translating to increased net gains on sales.  Credit card income increased $593,000 in the third quarter of 2016, or 99%, compared to the third quarter of 2015, resulting from a 58% increase in the volume of spending and a 62% increase in the number of credit card accounts.  We introduced a purchase card product in the fourth quarter of 2015.  This new product also contributed to our increase in credit card income.

Non-interest expense for the third quarter of 2016 increased $1.9 million, or 10%, to $20.2 million from $18.2 million in the third quarter of 2015, and increased $658,000, or 3%, on a linked quarter basis.  Salary and benefit expense for the third quarter of 2016 increased $363,000, or 3%, to $11.0 million from $10.6 million in the third quarter of 2015, and increased $225,000, or 2%, on a linked quarter basis.  Equipment and Occupancy expense increased $525,000, or 33%, to $2.1 million in the third quarter of 2016, from $1.6 million in the third quarter of 2015.  This increase in equipment and occupancy expense was attributable to new offices in our Charleston, South Carolina and Nashville, Tennessee regions, each of which were relocations from temporary facilities we previously occupied.  We also accelerated depreciation of leasehold improvements in our Birmingham, Alabama headquarters building to coincide with our anticipated move date to our new headquarters building, which we anticipate will be in the second half of 2017.  Professional services expense increased $514,000, or 77%, to $1.2 million in the third quarter of 2016, from $668,000 in the third quarter of 2015, primarily the result of accruals for current pending litigation.  Other operating expense for the third quarter of 2016 increased $640,000, or 15%, to $5.0 million from $4.3 million in the third quarter of 2015.  This was primarily the result of higher data processing expenses related to increased online banking transaction volumes and an upgrade of our correspondent banking platform, increased Federal Reserve Bank charges from our correspondent bank clearing activities and increased credit card processing expenses.  We also contributed $113,000 to a Birmingham-based charitable organization as part of an investment in a new markets tax credit partnership.  These increases were offset by lower costs incurred related to nonperforming loans.

Income tax expense increased $160,000, or 2%, to $8.2 million in the third quarter of 2016, compared to $8.0 million in the third quarter of 2015, and increased $1.2 million, or 6%, to $22.0 million in the nine month period ended September 30, 2016, compared to $20.9 million in the nine month period ended September 30, 2015.  In the second quarter of 2016 we adopted the amendments in Accounting Standards Update 2016-09 using the modified retrospective method.  We have recognized excess tax benefits from the exercise and vesting of stock options and restricted stock of $421,000 in the third quarter of 2015 and $4.7 million in the nine months ended September 30, 2016.  Previously under generally accepted accounting principles, such credits were reflected within additional paid-in capital.

GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures

We recorded expenses of $2.1 million for the first quarter of 2015 related to the acquisition of Metro Bancshares, Inc. and the merger of Metro Bank with and into the Bank, and recorded an expense of $500,000 resulting from the initial funding of reserves for unfunded loan commitments for the first quarter of 2015, consistent with guidance provided in the Federal Reserve Bank's Inter-agency Policy Statement SR 06-17.  Core financial measures included in this press release are "core net income," "core net income available to common stockholders," "core diluted earnings per share," "core return on average assets" and "core return on average common stockholders' equity."  Each of these five core financial measures excludes the impact of the non-routine expenses attributable to merger expenses, the initial funding of reserves for unfunded loan commitments, and are all considered non-GAAP financial measures.  Other non-GAAP financial measures included in this press release are "tangible common stockholders' equity," "total tangible assets," "tangible book value per share," and "tangible common equity to total tangible assets."  All non-GAAP financial measures are more fully explained below.

"Core net income" is defined as net income, adjusted by the net effect of the non-routine expense.

"Core net income available to common stockholders" is defined as net income available to common stockholders, adjusted by the net effect of the non-routine expense.

"Core diluted earnings per share" is defined as net income available to common stockholders, adjusted by the net effect of the non-routine expense, divided by weighted average diluted shares outstanding.

"Core return on average assets" is defined as net income, adjusted by the net effect of the non-routine expense, divided by average total assets.

"Core return of average common stockholders' equity" is defined as net income, adjusted by the net effect of the non-routine expense, divided by average common stockholders' equity.

"Tangible common stockholders' equity" is defined as common stockholders' equity, adjusted by the total of goodwill and other identifiable intangible assets.

"Total tangible assets" is defined as total assets, adjusted by the total of goodwill and other identifiable intangible assets.

"Tangible book value per share" is defined as tangible common stockholders' equity divided by the number of common shares outstanding.

"Tangible common equity to total tangible assets" is defined as tangible common equity divided by total tangible assets.

We believe these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that these non-GAAP financial measures have a number of limitations.  As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies, including those in our industry, use.  The following reconciliation table provides a more detailed analysis of the non-GAAP financial measures as of and for the nine month comparative periods ended September 30, 2016 and 2015 included in this press release.  Dollars are in thousands, except share and per share data.





As Of September 30,
2016


As Of and For the
Nine Months Ended
September 30, 2015


Return on average assets - GAAP







1.32

%


Net income - GAAP






$

43,790




Adjustments:











Merger expenses - Metro Bancshares, Inc.







2,096




Initial reserve for unfunded loan commitments







500




     Tax (benefit) of adjustments







(829)



Core net income - non-GAAP*






$

45,557



Average assets - GAAP






$

4,430,226



Core return on average assets - non-GAAP*







1.37

%













Return on average common stockholders' equity - GAAP







14.40

%


Net income available to common stockholders - GAAP






$

43,534




Adjustments:











Merger expenses - Metro Bancshares, Inc.







2,096




Initial reserve for unfunded loan commitments







500




     Tax (benefit) of adjustments







(829)



Core net income available to common stockholders - non-GAAP*






$

45,301



Average common stockholders' equity - GAAP






$

404,177



Core return on average common stockholders' equity - non-GAAP*







14.99

%













Diluted earnings per share - GAAP






$

1.65



Weighted average shares outstanding, diluted - GAAP







26,391,100



Core diluted earnings per share - non-GAAP*






$

1.72














Book value per share - GAAP


$

19.31



$

16.65



Total common stockholders' equity - GAAP



507,866




431,194




Adjustments:











Goodwill and other identifiable intangible assets



15,073




17,756



Tangible common stockholders' equity - non-GAAP


$

492,793



$

413,438



Tangible book value per share - non-GAAP


$

18.73



$

15.96














Stockholders' equity to total assets - GAAP



8.46

%



9.03

%


Total assets - GAAP


$

6,002,621



$

4,772,601




Adjustments:











Goodwill and other identifiable intangible assets



15,073




17,756



Total tangible assets - non-GAAP


$

5,987,548



$

4,754,845



Tangible common equity to total tangible assets - non-GAAP



8.23

%



8.70

%














* Core measures exclude non-routine expenses during the comparative periods presented in this press release as more fully described in "GAAP Reconciliation and Management Explanation on Non-GAAP Financial Measures" above.


 

About ServisFirst Bancshares, Inc.

ServisFirst Bancshares, Inc. is a bank holding company based in Birmingham, Alabama. Through its subsidiary ServisFirst Bank, ServisFirst Bancshares, Inc. provides business and personal financial services from locations in Birmingham, Huntsville, Montgomery, Mobile and Dothan, Alabama, Pensacola and Tampa Bay, Florida, Atlanta, Georgia, Charleston, South Carolina and Nashville, Tennessee.

ServisFirst Bancshares, Inc. files periodic reports with the U.S. Securities and Exchange Commission (SEC).  Copies of its filings may be obtained through the SEC's website at www.sec.gov or at http://servisfirstbancshares.investorroom.com/.

Statements in this press release that are not historical facts, including, but not limited to, statements concerning future operations, results or performance, are hereby identified as "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933.  The words "believe," "expect," "anticipate," "project," "plan," "intend," "will," "would," "might" and similar expressions often signify forward-looking statements. Such statements involve inherent risks and uncertainties. ServisFirst Bancshares, Inc. cautions that such forward-looking statements, wherever they occur in this press release or in other statements attributable to ServisFirst Bancshares, Inc., are necessarily estimates reflecting the judgment of ServisFirst Bancshares, Inc.'s senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements.  Such forward-looking statements should, therefore, be considered in light of various factors that could affect the accuracy of such forward-looking statements, including: general economic conditions, especially in the credit markets and in the Southeast; the performance of the capital markets; changes in interest rates, yield curves and interest rate spread relationships; changes in accounting and tax principles, policies or guidelines; changes in legislation or regulatory requirements; changes in our loan portfolio and the deposit base; possible changes in laws and regulations and governmental monetary and fiscal policies, including, but not limited to, economic stimulus initiatives; the cost and other effects of legal and administrative cases and similar contingencies; possible changes in the creditworthiness of customers and the possible impairment of the collectability of loans and the value of collateral; the effect of natural disasters, such as hurricanes and tornados, in our geographic markets; and increased competition from both banks and non-bank financial institutions.  The foregoing list of factors is not exhaustive. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to "Cautionary Note Regarding Forward-looking Statements" and "Risk Factors" in our most recent Annual Report on Form 10-K and our other SEC filings. If one or more of the factors affecting our forward-looking information and statements proves incorrect, then our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements contained herein. Accordingly, you should not place undue reliance on any forward-looking statements, which speak only as of the date made.  ServisFirst Bancshares, Inc. assumes no obligation to update or revise any forward-looking statements that are made from time to time.

More information about ServisFirst Bancshares, Inc. may be obtained over the Internet at http://servisfirstbancshares.investorroom.com/  or by calling (205) 949-0302.

Contact: ServisFirst Bank
Davis Mange (205) 949-3420
dmange@servisfirstbank.com

 


 


SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)







(In thousands except share and per share data)












3rd Quarter 2016


2nd Quarter 2016


1st Quarter 2016


4th Quarter 2015


3rd Quarter 2015


CONSOLIDATED STATEMENT OF INCOME






















Interest income


$

54,691



$

52,050



$

49,961



$

48,451



$

46,532



Interest expense



6,773




6,159




5,782




5,290




4,670



Net interest income



47,918




45,891




44,179




43,161




41,862



Provision for loan losses



3,464




3,800




2,059




3,308




3,072



Net interest income after provision for loan losses



44,454




42,091




42,120




39,853




38,790



Non-interest income



4,791




3,847




3,435




3,475




3,738



Non-interest expense



20,162




19,504




19,290




19,002




18,248



Income before income tax



29,083




26,434




26,265




24,326




24,280



Provision for income tax



8,174




7,558




6,309




4,576




8,014



Net income



20,909




18,876




19,956




19,750




16,266



Preferred stock dividends



-




23




-




24




33



Net income available to common stockholders


$

20,909



$

18,853



$

19,956



$

19,726



$

16,233



Earnings per share - basic


$

0.80



$

0.72



$

0.76



$

0.76



$

0.63



Earnings per share - diluted


$

0.78



$

0.71



$

0.75



$

0.74



$

0.61



Average diluted shares outstanding



26,939,664




26,726,284




26,566,810




26,595,239




26,506,334

























CONSOLIDATED BALANCE SHEET DATA






















Total assets


$

6,002,621



$

5,646,055



$

5,378,599



$

5,095,509



$

4,772,601



Loans



4,657,284




4,539,338




4,340,900




4,216,375




4,044,242



Debt securities



377,270




347,706




362,106




370,364




334,635



Non-interest-bearing demand deposits



1,269,726




1,185,668




1,070,275




1,053,467




1,029,354



Total deposits



5,081,128




4,664,795




4,339,747




4,223,888




4,044,634



Borrowings



55,356




55,450




55,543




55,637




55,728



Stockholders' equity


$

507,866



$

489,097



$

470,940



$

449,147



$

431,194

























Shares outstanding



26,305,448




26,251,948




26,182,698




25,972,698




25,903,698



Book value per share


$

19.31



$

18.63



$

17.99



$

17.29



$

16.65



Tangible book value per share (1)


$

18.73



$

18.05



$

17.40



$

16.70



$

15.96

























SELECTED FINANCIAL RATIOS






















Net interest margin



3.35

%



3.51

%



3.57

%



3.56

%



3.77

%


Return on average assets



1.39

%



1.37

%



1.53

%



1.55

%



1.38

%


Return on average common stockholders' equity



16.66

%



15.79

%



17.39

%



17.75

%



15.52

%


Efficiency ratio



38.25

%



39.21

%



40.51

%



40.75

%



40.02

%


Non-interest expense to average earning assets



1.39

%



1.50

%



1.56

%



1.56

%



1.63

%
























CAPITAL RATIOS (2)






















Common equity tier 1 capital to risk-weighted assets (3)



9.91

%



9.83

%



9.90

%



9.72

%



9.59

%


Tier 1 capital to risk-weighted assets



9.92

%



9.84

%



9.91

%



9.73

%



9.60

%


Total capital to risk-weighted assets



12.03

%



11.98

%



12.12

%



11.95

%



11.89

%


Tier 1 capital to average assets



8.20

%



8.52

%



8.65

%



8.55

%



8.83

%


Tangible common equity to total tangible assets (1)



8.23

%



8.42

%



8.50

%



8.54

%



8.70

%
























(1) See "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" for a discussion of these Non-GAAP financial measures.


(2) Regulatory capital ratios for most recent period are preliminary.


(3) Basel III final capital rules, including the new Common Equity Tier 1 Capital to Risk-Weighted Assets ratio, became effective for the Company on January 1, 2015.


 

 

 


CONSOLIDATED BALANCE SHEETS (UNAUDITED)







(Dollars in thousands)











September 30, 2016


September 30, 2015


% Change


ASSETS











Cash and due from banks


$

57,221


$

50,481


13

%


Interest-bearing balances due from depository institutions



553,392



165,982


233

%


Federal funds sold



181,644



26,229


593

%



Cash and cash equivalents



792,257



242,692


226

%


Available for sale debt securities, at fair value



351,417



306,666


15

%


Held to maturity debt securities (fair value of $26,912 and $28,511 at












September 30, 2016 and 2015, respectively)



25,853



27,969


(8)

%


Restricted equity securities



5,668



4,954


14

%


Mortgage loans held for sale



6,026



5,387


12

%


Loans



4,657,284



4,044,242


15

%


Less allowance for loan losses



(48,933)



(42,574)


15

%



Loans, net



4,608,351



4,001,668


15

%


Premises and equipment, net



25,033



18,989


32

%


Goodwill and other identifiable intangible assets



15,073



17,756


(15)

%


Other assets



172,943



146,520


18

%



Total assets


$

6,002,621


$

4,772,601


26

%


LIABILITIES AND STOCKHOLDERS' EQUITY











Liabilities:











Deposits:












Non-interest-bearing


$

1,269,726


$

1,029,354


23

%



Interest-bearing



3,811,402



3,015,280


26

%




Total deposits



5,081,128



4,044,634


26

%


Federal funds purchased



344,390



228,415


51

%


Other borrowings



55,356



55,728


(1)

%


Other liabilities



13,881



12,630


10

%



Total liabilities



5,494,755



4,341,407


27

%


Stockholders' equity:












Preferred stock, Series A Senior Non-Cumulative Perpetual, par value $0.001













(liquidation preference $1,000), net of discount; no shares authorized or













outstanding at September 30, 2016, and 40,000 authorized, no shares issued













and outstanding at September 30, 2015



-



-






Preferred stock, par value $0.001 per share; 1,000,000 shares authorized and













undesignated at September 30, 2016, and 1,000,000 shares authorized and













960,000 shares undesignated at September 30, 2015



-



-






Common stock, par value $0.001 per share; 100,000,000 shares authorized and













26,305,448 shares issued and outstanding at September 30, 2016 and 50,000,000













authorized and 25,903,698 shares issued and outstanding at September 30, 2015



26



26


-

%



Additional paid-in capital



215,262



210,331


2

%



Retained earnings



287,568



215,982


33

%



Accumulated other comprehensive income



4,633



4,478


3

%



Noncontrolling interest



377



377


-

%




Total stockholders' equity



507,866



431,194


18

%



Total liabilities and stockholders' equity


$

6,002,621


$

4,772,601


26

%


 

 

 

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)










(In thousands except per share data)














Three Months Ended September 30,


Nine Months Ended September 30,






2016


2015


2016


2015


Interest income:















Interest and fees on loans


$

51,598


$

44,401


$

148,055


$

125,152



Taxable securities



1,107



1,041



3,614



3,273



Nontaxable securities



823



890



2,515



2,624



Federal funds sold



347



32



630



81



Other interest and dividends



816



168



1,888



394



   Total interest income



54,691



46,532



156,702



131,524


Interest expense:















Deposits



5,358



3,818



14,352



10,600



Borrowed funds



1,415



852



4,362



1,814



   Total interest expense



6,773



4,670



18,714



12,414



   Net interest income



47,918



41,862



137,988



119,110


Provision for loan losses



3,464



3,072



9,323



9,539



   Net interest income after provision for loan losses


44,454



38,790



128,665



109,571


Non-interest income:















Service charges on deposit accounts



1,367



1,279



3,980



3,762



Mortgage banking



1,112



873



2,681



2,062



Securities gains



-



-



(3)



29



Increase in cash surrender value life insurance


770



683



2,049



1,991



Other operating income



1,542



903



3,366



2,258



   Total non-interest income



4,791



3,738



12,073



10,102


Non-interest expense:















Salaries and employee benefits



10,958



10,595



32,758



30,029



Equipment and occupancy expense



2,100



1,575



6,108



4,870



Professional services



1,182



668



2,919



1,901



FDIC and other regulatory assessments



775



681



2,328



1,927



Other real estate owned expense



178



400



668



903



Merger expense



-



-



-



2,100



Other operating expense



4,969



4,329



14,175



13,264



   Total non-interest expense



20,162



18,248



58,956



54,994



   Income before income tax



29,083



24,280



81,782



64,679


Provision for income tax



8,174



8,014



22,041



20,889



         Net income



20,909



16,266



59,741



43,790



Dividends on preferred stock



-



33



23



256



         Net income available to common stockholders

$

20,909


$

16,233


$

59,718


$

43,534


Basic earnings per common share


$

0.80


$

0.63


$

2.27


$

1.70


Diluted earnings per common share


$

0.78


$

0.61


$

2.23


$

1.65


 

 

 


LOANS BY TYPE (UNAUDITED)










(In thousands)






























3rd Quarter 2016


2nd Quarter 2016


1st Quarter 2016


4th Quarter 2015


3rd Quarter 2015

Commercial, financial and agricultural


$

1,910,777


$

1,895,870


$

1,799,132


$

1,760,479


$

1,683,819

Real estate - construction



292,721



251,144



254,254



243,267



232,895

Real estate - mortgage:

















Owner-occupied commercial



1,138,308



1,117,514



1,055,852



1,014,669



978,721


1-4 family mortgage



520,394



494,733



458,032



444,134



417,012


Other mortgage



740,127



725,336



723,542



698,779



677,822

Subtotal: Real estate - mortgage



2,398,829



2,337,583



2,237,426



2,157,582



2,073,555

Consumer



54,957



54,741



50,088



55,047



53,973

Total loans


$

4,657,284


$

4,539,338


$

4,340,900


$

4,216,375


$

4,044,242

 

 

 


SUMMARY OF LOAN LOSS EXPERIENCE (UNAUDITED)



















(Dollars in thousands)




















3rd Quarter 2016


2nd Quarter 2016


1st Quarter 2016


4th Quarter 2015


3rd Quarter 2015


Allowance for loan losses:






















Beginning balance


$

46,998



$

45,145



$

43,419



$

42,574



$

40,020



Loans charged off:























Commercial financial and agricultural



1,270




1,412




50




2,186




388




Real estate - construction



79




355




381




161




31




Real estate - mortgage



144




191




-




463




-




Consumer



81




31




18




21




126





Total charge offs



1,574




1,989




449




2,831




545



Recoveries:























Commercial financial and agricultural



35




1




3




241




13




Real estate - construction



9




39




16




61




13




Real estate - mortgage



1




2




97




65




1




Consumer



-




-




-




1




-





Total recoveries



45




42




116




368




27




Net charge-offs



1,529




1,947




333




2,463




518




Provision for loan losses



3,464




3,800




2,059




3,308




3,072




Ending balance


$

48,933



$

46,998



$

45,145



$

43,419



$

42,574




























Allowance for loan losses to total loans



1.05

%



1.04

%



1.04

%



1.03

%



1.05

%



Allowance for loan losses to total average
























loans



1.07

%



1.06

%



1.06

%



1.05

%



1.08

%



Net charge-offs to total average loans



0.13

%



0.18

%



0.03

%



0.24

%



0.05

%



Provision for loan losses to total average
























loans



0.30

%



0.34

%



0.20

%



0.32

%



0.31

%



Nonperforming assets:
























Nonaccrual loans


$

6,647



$

4,730



$

6,133



$

7,767



$

9,850





Loans 90+ days past due and accruing


43




423




417




1




524





Other real estate owned and
























   repossessed assets



3,035




4,260




4,044




5,392




6,068




Total


$

9,725



$

9,413



$

10,594



$

13,160



$

16,442


























Nonperforming loans to total loans



0.14

%



0.11

%



0.15

%



0.18

%



0.26

%



Nonperforming assets to total assets



0.16

%



0.17

%



0.20

%



0.26

%



0.34

%



Nonperforming assets to earning assets



0.16

%



0.17

%



0.20

%



0.26

%



0.35

%



Reserve for loan losses to nonaccrual loans



736.17

%



993.62

%



736.10

%



559.02

%



432.22

%

























Restructured accruing loans


$

6,738



$

6,753



$

6,763



$

6,782



$

8,266


























Restructured accruing loans to total loans



0.14

%



0.15

%



0.16

%



0.16

%



0.20

%




























TROUBLED DEBT RESTRUCTURINGS (TDRs) (UNAUDITED)
















(In thousands)






















3rd Quarter 2016


2nd Quarter 2016


1st Quarter 2016


4th Quarter 2015


3rd Quarter 2015



Beginning balance:


$

6,753



$

6,763



$

7,736



$

8,266



$

8,279





Net (paydowns) / advances



(15)




(10)




(19)




(83)




(13)





Transfers to other real estate owned


-




-




(954)




-




-





Charge-offs



-




-




-




(447)




-







$

6,738



$

6,753



$

6,763



$

7,736



$

8,266



 

 

 


CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)











(In thousands except per share data)















3rd Quarter
2016


2nd Quarter
2016


1st Quarter
2016


4th Quarter
2015


3rd Quarter
2015


Interest income:


















Interest and fees on loans


$

51,598


$

49,210


$

47,247


$

46,150


$

44,401



Taxable securities



1,107



1,238



1,269



1,058



1,041



Nontaxable securities



823



834



858



875



890



Federal funds sold



347



210



73



46



32



Other interest and dividends



816



558



514



322



168



   Total interest income



54,691



52,050



49,961



48,451



46,532


Interest expense:


















Deposits



5,358



4,611



4,361



4,294



3,818



Borrowed funds



1,415



1,548



1,421



996



852



   Total interest expense



6,773



6,159



5,782



5,290



4,670



   Net interest income



47,918



45,891



44,179



43,161



41,862


Provision for loan losses



3,464



3,800



2,059



3,308



3,072



   Net interest income after provision for loan losses



44,454



42,091



42,120



39,853



38,790


Non-interest income:


















Service charges on deposit accounts



1,367



1,306



1,307



1,326



1,279



Mortgage banking



1,112



901



668



620



873



Securities gains



-



(3)



-



-



-



Increase in cash surrender value life insurance



770



655



624



630



683



Other operating income



1,542



988



836



899



903



   Total non-interest income



4,791



3,847



3,435



3,475



3,738


Non-interest expense:


















Salaries and employee benefits



10,958



10,733



11,067



8,884



10,595



Equipment and occupancy expense



2,100



2,023



1,985



1,519



1,575



Professional services



1,182



999



738



706



668



FDIC and other regulatory assessments



775



803



750



733



681



Other real estate owned expense



178



41



449



324



400



Other operating expense



4,969



4,905



4,301



6,836



4,329



   Total non-interest expense



20,162



19,504



19,290



19,002



18,248



   Income before income tax



29,083



26,434



26,265



24,326



24,280


Provision for income tax



8,174



7,558



6,309



4,576



8,014



       Net income



20,909



18,876



19,956



19,750



16,266



Dividends on preferred stock



-



23



-



24



33



         Net income available to common stockholders


$

20,909


$

18,853


$

19,956


$

19,726


$

16,233


Basic earnings per common share


$

0.80


$

0.72


$

0.76


$

0.76


$

0.63


Diluted earnings per common share


$

0.78


$

0.71


$

0.75


$

0.74


$

0.61


 

 

 

AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS (UNAUDITED)


ON A FULLY TAXABLE-EQUIVALENT BASIS


(Dollars in thousands)














































3rd Quarter 2016


2nd Quarter 2016



1st Quarter 2016


4th Quarter 2015


3rd Quarter 2015








Average
Balance


Yield /
Rate


Average
Balance


Yield /
Rate


Average
Balance


Yield /
Rate


Average
Balance


Yield /
Rate


Average
Balance


Yield /
Rate


Assets:
































Interest-earning assets:

































Loans, net of unearned income (1)


































Taxable


$

4,564,475


4.48

%


$

4,406,107


4.47

%


$

4,230,057


4.48

%


$

4,113,044


4.44

%


$

3,915,778


4.48

%




Tax-exempt (2)



21,939


4.39




16,315


4.51




10,281


5.56




9,639


4.98




9,802


4.98






Total loans, net of




































unearned income



4,586,414


4.48




4,422,422


4.47




4,240,338


4.48




4,122,683


4.44




3,925,580


4.48




Mortgage loans held for sale



6,724


3.79




7,323


3.62




6,084


4.63




4,362


4.27




7,714


4.32




Debt securities:


































Taxable



215,250


2.06




208,113


2.38




221,722


2.29




193,982


2.16




189,941


2.17





Tax-exempt (2)



135,272


3.73




135,954


3.73




137,763


3.79




139,435


3.85




139,543


3.91






Total securities (3)



350,522


2.70




344,067


2.91




359,485


2.86




333,417


2.87




329,484


2.91




Federal funds sold



217,158


0.64




144,206


0.59




48,390


0.60




33,255


0.55




24,860


0.51




Restricted equity securities



5,658


4.01




5,659


3.62




4,962


3.81




4,954


4.24




4,954


4.16




Interest-bearing balances with banks



590,675


0.51




393,782


0.52




373,339


0.51




366,771


0.29




168,548


0.27




Total interest-earning assets



5,757,151


3.81

%



5,317,459


3.97

%



5,032,598


4.03

%



4,865,442


3.99

%



4,461,140


4.18

%


Non-interest-earning assets:

































Cash and due from banks



58,809






65,318






61,578






62,037






63,259






Net premises and equipment



25,000






23,241






21,023






19,609






18,961






Allowance for loan losses, accrued


































interest and other assets



145,804






127,640






126,491






124,241






127,778








Total assets


$

5,986,764





$

5,533,658





$

5,241,690





$

5,071,329





$

4,671,136









































Interest-bearing liabilities:

































Interest-bearing deposits:

































Checking


$

696,100


0.37

%


$

691,776


0.36

%


$

665,039


0.35

%


$

611,521


0.30

%


$

593,550


0.28

%



Savings



43,569


0.30




41,546


0.30




41,055


0.29




39,590


0.29




37,281


0.30




Money market



2,471,829


0.55




2,105,420


0.52




1,979,727


0.51




2,048,453


0.49




1,817,997


0.47




Time deposits



519,653


0.99




498,151


1.01




507,605


1.00




503,217


1.00




485,137


0.99





Total interest-bearing deposits



3,731,151


0.57




3,336,893


0.56




3,193,426


0.55




3,202,781


0.54




2,933,965


0.52




Federal funds purchased



436,415


0.64




505,076


0.64




441,309


0.64




295,530


0.37




246,168


0.31




Other borrowings



55,410


5.15




55,521


5.20




55,630


5.19




55,805


5.11




50,509


5.18




Total interest-bearing liabilities



4,222,976


0.64

%



3,897,490


0.64

%



3,690,365


0.63

%



3,554,116


0.59

%



3,230,642


0.57

%


Non-interest-bearing liabilities:

































Non-interest-bearing


































demand



1,250,139






1,142,541






1,077,613






1,062,795






988,756






Other liabilities



14,376






13,301






12,194






13,469






23,714






Stockholders' equity



494,248






475,917






457,218






436,928






424,113






Unrealized gains on securities and


































derivatives



5,025






4,409






4,300






4,021






3,911








Total liabilities and




































stockholders' equity


$

5,986,764





$

5,533,658





$

5,241,690





$

5,071,329





$

4,671,136





Net interest spread





3.17

%





3.33

%





3.40

%





3.40

%





3.61

%


Net interest margin





3.35

%





3.51

%





3.57

%





3.56

%





3.77

%






































(1)

Average loans include loans on which the accrual of interest has been discontinued.


 

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/servisfirst-bancshares-inc-announces-results-for-third-quarter-of-2016-300346033.html

SOURCE ServisFirst Bancshares, Inc.