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Section 1: 8-K (FORM 8-K)

fcbc20180424_8k.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

 

 

Date of Report (Date of earliest event reported): April 24, 2018

 

 

 

FIRST COMMUNITY BANCSHARES, INC.

 
  (Exact name of registrant as specified in its charter)  

 

 

Nevada

 

000-19297

 

55-0694814

(State or other jurisdiction

 

(Commission

 

(IRS Employer

of incorporation)

 

File Number)

 

Identification No.)

 
 

P.O. Box 989

Bluefield, Virginia

 

24605-0989

(Address of principal executive offices)

 

(Zip Code)

 
 

Registrant’s telephone number, including area code: (276) 326-9000

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

[  ]   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

[  ]   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

[  ]   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

[  ]   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 2.02          Results of Operations and Financial Condition.

 

On April 24, 2018, First Community Bancshares, Inc. (the “Company”) announced by press release its earnings for the first quarter of 2018. A copy of the press release is attached hereto as Exhibit 99.1.

 

Item 5.07    Submission of Matters to a Vote of Security Holders

 

On April 24, 2018, the Company held its annual shareholders’ meeting. At the meeting, the Company’s shareholders: (i) elected all persons listed below under Proposal 1 to serve as director of the Company for a term that will continue until the 2021 annual meeting of shareholders; (ii) ratified the appointment of Dixon Hughes Goodman LLP as the Company’s independent registered public accounting firm; and (iii) approved an Agreement and Plan of Reincorporation and Merger, approved by the Board of Directors on February 27, 2018, pursuant to which the Corporation's state of incorporation would change from Nevada to Virginia, by means of the Corporation merging with and into a new Virginia Corporation, to be named "First Community Bankshares, Inc.," so that the stockholders of the Corporation would become shareholders of the new Virginia Corporation.

 

The following tables summarize voting results by the Company’s shareholders.

 

Proposal 1: To elect two directors to serve as members of the Board of Directors Class of 2021.

 

Nominee

 

Votes FOR

 

Votes

WITHHELD

 

Broker Non-

Votes

             

W.C. Blankenship, Jr.

 

9,909,436

 

863,910

 

2,054,462

William P. Stafford, II

 

10,414,022

 

359,324

   

 

Proposal 2: To ratify the appointment of Dixon Hughes Goodman LLP as the Company’s independent registered public accounting firm.

 

Votes FOR

 

Votes AGAINST

 

Votes ABSTAIN

 

       

12,164,348

 

657,072

 

6,388

 

Proposal 3: To approve an Agreement and Plan of Reincorporation and Merger pursuant to which the Corporation's state of incorporation would change from Nevada to Virginia, by means of the Corporation merging with and into a new Virginia Corporation, to be named "First Community Bankshares, Inc.," so that the stockholders of the Corporation would become shareholders of the new Virginia Corporation.

 

Votes FOR

 

Votes AGAINST

 

Votes ABSTAIN

 

       

10,509,872

 

262,323

 

1,151

 

Item 8.01            Other Events.     

 

On April 24, 2018, the Company announced by press release its quarterly cash dividend to common shareholders of eighteen cents ($0.18) per common share, payable on May 18, 2018, to shareholders of record on May 4, 2018. A copy of the press release is attached hereto as Exhibit 99.1.

 

Item 9.01            Financial Statements and Exhibits.

 

(d)

 

The following exhibit is included with this report:

 

Exhibit No.   Exhibit Description
     
99.1   Earnings and dividend press release dated April 24, 2018

 

 

 

 

Forward-Looking Statements 

 

This Current Report on Form 8-K contains forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include:  changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the Company’s Securities and Exchange Commission reports, including but not limited to the Annual Report on Form 10-K for the most recent year ended. Pursuant to the Private Securities Litigation Reform Act of 1995, the Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

FIRST COMMUNITY BANCSHARES, INC.

     

Date:

April 25, 2018

 

By:

/s/ David D. Brown

     
   

David D. Brown

   

Chief Financial Officer

 

(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

ex_111113.htm

Exhibit 99.1

 

NEWS RELEASE

FOR IMMEDIATE RELEASE:

 

FOR MORE INFORMATION, CONTACT:

April 24, 2018

 

David D. Brown

   

(276) 326-9000

 

First Community Bancshares, Inc. Announces Record First Quarter 2018 Results

and Quarterly Dividend

 

Bluefield, Virginia – First Community Bancshares, Inc. (NASDAQ: FCBC) (www.firstcommunitybank.com) (the “Company”) today reported its unaudited results of operations and other financial information for the quarter ended March 31, 2018. The Company reported net income of $8.87 million, or $0.52 per diluted common share for the quarter ended March 31, 2018, which represents a 44.44% increase in per share diluted earnings compared to the same quarter of 2017.

 

The Company also announced today that the Board of Directors declared a quarterly cash dividend to common shareholders of eighteen cents ($0.18) per common share. The quarterly dividend is payable to common shareholders of record on May 4, 2018, and is expected to be paid on or about May 18, 2018. The current year marks the 33rd consecutive year of regular cash dividends paid to shareholders.

 

First Quarter 2018 Highlights

 

Income Statement

 

o

Pre-tax income increased $2.18 million, or 23.54%, to $11.44 million compared to the same quarter of 2017.

 

o

Net income increased $2.67 million, or 42.99%, to $8.87 million compared to the same quarter of 2017.

 

o

Diluted earnings per share increased $0.16, or 44.44%, to $0.52 compared to the same quarter of 2017.

 

o

The non-GAAP efficiency ratio improved to 58.29% compared to 61.35% in the same quarter of 2017.

 

o

Net interest margin increased 21 basis points to 4.38%, and normalized net interest margin increased 8 basis points to 4.03% compared to the same quarter of 2017.

 

Balance Sheet

 

o

The Company repurchased 187,300 common shares during the quarter for $5.41 million compared to 6,800 shares during the same quarter of 2017.

 

o

The Company and its subsidiary bank both significantly exceed regulatory “well capitalized” targets as of March 31, 2018.

 

Other

 

o

The Company paid a one-time special cash dividend to common shareholders of $0.48 per common share on March 23, 2018. The special dividend was in addition to the regular cash dividend of $0.18 per common share paid on February 16, 2018.

 

Non-GAAP Financial Measures

 

The Company prepares its financial statements in accordance with GAAP. This press release also refers to certain non-GAAP financial measures that the Company believes provide investors with important information, when used in conjunction with results presented in accordance with GAAP, regarding its operational performance. The Company’s non-GAAP financial measures presented in this release include core earnings, the efficiency ratio, tangible book value per common share, average tangible common equity, and normalized net interest margin. Management believes that core earnings provide the Company and investors a valuable tool to evaluate the Company’s financial results. Management believes that the efficiency ratio provides important information about the Company’s operating expense control and efficiency of operations. Management also believes this ratio focuses attention on the core operating performance of the Company over time and is highly useful in comparing period-to-period operating performance of core business operations. The efficiency ratio used by the Company may not be comparable to efficiency ratios reported by other financial institutions. The reconciliations of these measures to GAAP measures are provided within this news release.

 

1

 

 

About First Community Bancshares, Inc.

 

First Community Bancshares, Inc., a financial holding company headquartered in Bluefield, Virginia, provides banking products and services through its wholly owned subsidiary First Community Bank. First Community Bank operated 44 branch banking locations in Virginia, West Virginia, North Carolina, and Tennessee as of March 31, 2018. First Community Bank provides insurance services through First Community Insurance Services, which operates in-branch locations in Virginia and West Virginia and offers wealth management and investment advice through its Trust Division and First Community Wealth Management, which collectively managed $945 million in combined assets as of March 31, 2018. The Company reported consolidated assets of $2.43 billion as of March 31, 2018. The Company’s common stock is listed on the NASDAQ Global Select Market under the trading symbol, “FCBC”. Additional investor information is available on the Company’s website at www.firstcommunitybank.com.

 

This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the Company’s Securities and Exchange Commission reports including, but not limited to, the Annual Report on Form 10-K for the most recent fiscal year end. Pursuant to the Private Securities Litigation Reform Act of 1995, the Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

 

2

 

 

Financial Performance

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

 

   

Three Months Ended

 
   

March 31,

   

December 31,

   

September 30,

   

June 30,

   

March 31,

 

(Amounts in thousands, except share and per share data)

 

2018

   

2017

   

2017

   

2017

   

2017

 

Interest income

                                       

Interest and fees on loans

  $ 22,755     $ 22,314     $ 22,694     $ 22,914     $ 21,827  

Interest on securities

    1,104       1,095       1,080       1,170       1,206  

Interest on deposits in banks

    471       353       275       221       159  

Total interest income

    24,330       23,762       24,049       24,305       23,192  

Interest expense

                                       

Interest on deposits

    1,251       1,313       1,275       1,233       1,166  

Interest on borrowings

    700       716       724       778       885  

Total interest expense

    1,951       2,029       1,999       2,011       2,051  

Net interest income

    22,379       21,733       22,050       22,294       21,141  

Provision for loan losses

    495       615       730       934       492  

Net interest income after provision

    21,884       21,118       21,320       21,360       20,649  

Total noninterest income

    7,096       7,947       7,135       5,475       5,691  

Total noninterest expense

    17,544       17,132       16,909       17,458       17,083  

Income before income taxes

    11,436       11,933       11,546       9,377       9,257  

Income tax expense

    2,568       10,720       3,894       2,959       3,055  

Net income

  $ 8,868     $ 1,213     $ 7,652     $ 6,418     $ 6,202  
                                         

Earnings per common share

                                       

Basic

  $ 0.52     $ 0.07     $ 0.45     $ 0.38     $ 0.36  

Diluted

    0.52       0.07       0.45       0.38       0.36  

Cash dividends per common share

    0.66       0.18       0.16       0.16       0.16  

Weighted average shares outstanding

                                       

Basic

    16,955,758       16,992,519       17,005,654       17,012,189       16,998,125  

Diluted

    17,047,638       17,083,949       17,082,729       17,082,832       17,072,174  

Performance ratios

                                       

Return on average assets

    1.52 %     0.20 %     1.29 %     1.08 %     1.06 %

Return on average common equity

    10.30 %     1.35 %     8.61 %     7.41 %     7.35 %

Return on average tangible common equity(1)

    14.53 %     1.89 %     12.13 %     10.51 %     10.50 %

 

 

 

                         

(1)

A non-GAAP financial measure defined as average stockholders’ equity less average goodwill and other intangibles

 

3

 

 

RECONCILIATION OF GAAP NET INCOME TO CORE EARNINGS (Unaudited)

 

     

Three Months Ended

 
     

March 31,

   

December 31,

   

September 30,

   

June 30,

   

March 31,

 
     

2018

   

2017

   

2017

   

2017

   

2017

 

(Amounts in thousands, except per share data)

                                       

Net income, GAAP

  $ 8,868     $ 1,213     $ 7,652     $ 6,418     $ 6,202  

Non-GAAP adjustments:

                                       

Net loss on sale of securities

    -       4       -       657       -  

Deferred tax asset revaluation

    -       6,552       -       -       -  

Other non-core items

    (130 )     (140 )     34       (174 )     (18 )

Total adjustments to core earnings

    (130 )     6,416       34       483       (18 )

Tax effect

    (24 )     (50 )     12       345       (7 )

Core earnings, non-GAAP(1)

  $ 8,762     $ 7,679     $ 7,674     $ 6,556     $ 6,191  
                                           

Core diluted earnings per common share

  $ 0.51     $ 0.45     $ 0.45     $ 0.38     $ 0.36  

Performance ratios

                                       

Core return on average assets

    1.50 %     1.28 %     1.29 %     1.11 %     1.06 %

Core return on average common equity

    10.17 %     8.56 %     8.63 %     7.57 %     7.33 %

Core return on average tangible common equity(2)

    14.36 %     11.99 %     12.16 %     10.74 %     10.48 %

 

 

 

         

(1)

Excludes gains, losses, and impairment losses on securities; goodwill and intangible impairment; taxes; and other non-recurring income and expense items from net income

(2)

A non-GAAP financial measure defined as average stockholders’ equity less average goodwill and other intangibles

 

4

 

 

Net Interest Income and Margin

 

 

AVERAGE BALANCE SHEETS AND NET INTEREST INCOME ANALYSIS (Unaudited)

 

   

Three Months Ended March 31,

 
   

2018

   

2017

 
   

Average

           

Average Yield/

   

Average

           

Average Yield/

 

(Amounts in thousands)

 

Balance

   

Interest(1)

   

Rate(1)

   

Balance

   

Interest(1)

   

Rate(1)

 

Assets

                                               

Earning assets

                                               

Loans(2)

  $ 1,805,839     $ 22,827       5.13 %   $ 1,838,837     $ 21,895       4.83 %

Securities available for sale

    165,103       1,384       3.40 %     161,738       1,483       3.72 %

Securities held to maturity

    25,132       105       1.69 %     47,112       152       1.31 %

Interest-bearing deposits

    117,953       471       1.62 %     55,754       159       1.16 %

Total earning assets

    2,114,027       24,787       4.76 %     2,103,441       23,689       4.57 %

Other assets

    252,284                       270,597                  

Total assets

  $ 2,366,311                     $ 2,374,038                  
                                                 

Liabilities and stockholders' equity

                                               

Interest-bearing deposits

                                               

Demand deposits

  $ 462,741     $ 63       0.06 %   $ 381,050     $ 54       0.06 %

Savings deposits

    518,560       82       0.06 %     525,573       84       0.06 %

Time deposits

    493,545       1,106       0.91 %     515,506       1,028       0.81 %

Total interest-bearing deposits

    1,474,846       1,251       0.34 %     1,422,129       1,166       0.33 %

Borrowings

                                               

Retail repurchase agreements

    4,444       1       0.09 %     66,947       11       0.07 %

Wholesale repurchase agreements

    25,000       199       3.23 %     25,000       199       3.23 %

FHLB advances and other borrowings

    50,000       500       4.06 %     66,618       675       4.11 %

Total borrowings

    79,444       700       3.57 %     158,565       885       2.26 %

Total interest-bearing liabilities

    1,554,290       1,951       0.51 %     1,580,694       2,051       0.53 %

Noninterest-bearing demand deposits

    432,606                       425,540                  

Other liabilities

    30,142                       25,477                  

Total liabilities

    2,017,038                       2,031,711                  

Stockholders' equity

    349,273                       342,327                  

Total liabilities and stockholders' equity

  $ 2,366,311                     $ 2,374,038                  

Net interest income, FTE

          $ 22,836                     $ 21,638          

Net interest rate spread

                    4.25 %                     4.04 %

Net interest margin

                    4.38 %                     4.17 %

 

 

 

                     

(1)

Fully taxable equivalent ("FTE") basis based on the federal statutory rate of 21% for periods after January 1, 2018, and 35% for periods prior to January 1, 2018

(2)

Nonaccrual loans are included in average balances; however, no related interest income is recorded during the period of nonaccrual.

 

5

 

 

RECONCILIATION OF GAAP NET INTEREST MARGIN TO NON-GAAP NORMALIZED NET INTEREST MARGIN (Unaudited)

 

   

Three Months Ended March 31,

 
   

2018

   

2017

 

(Amounts in thousands)

 

Interest(1)

   

Average Yield/ Rate(1)

   

Interest(1)

   

Average Yield/ Rate(1)

 

Earning assets

                               

Loans(2)

  $ 22,827       5.13 %   $ 21,895       4.83 %

Accretion income

    2,324               1,784          

Less: cash accretion income

    479               650          

Non-cash accretion income

    1,845               1,134          

Loans, normalized(3)

    20,982       4.71 %     20,761       4.58 %

Other earning assets

    1,960       2.58 %     1,794       2.75 %

Total earning assets

    22,942       4.40 %     22,555       4.35 %

Total interest-bearing liabilities

    1,951       0.51 %     2,051       0.53 %

Net interest income, FTE(3)

  $ 20,991             $ 20,504          

Net interest rate spread, normalized(3)

            3.89 %             3.82 %

Net interest margin, normalized(3)

            4.03 %             3.95 %

 

 

 

           

(1)

FTE basis based on the federal statutory rate of 21% for periods after January 1, 2018, and 35% for periods prior to January 1, 2018

(2)

Nonaccrual loans are included in average balances; however, no related interest income is recorded during the period of nonaccrual.

(3)

Normalized totals are non-GAAP financial measures that exclude non-cash loan interest accretion related to PCI loans.

 

6

 

 

Noninterest Income and Expense

 

CONDENSED QUARTERLY STATEMENTS OF INCOME (Unaudited)

 

   

Three Months Ended

 
   

March 31,

   

December 31,

   

September 30,

   

June 30,

   

March 31,

 

(Amounts in thousands)

 

2018

   

2017

   

2017

   

2017

   

2017

 

Noninterest income

                                       

Wealth management

  $ 794     $ 811     $ 758     $ 791     $ 790  

Service charges on deposits

    3,468       3,725       3,605       3,360       3,113  

Other service charges and fees

    2,285       2,237       2,141       2,168       2,078  

Insurance commissions

    329       343       306       325       373  

Net loss on sale of securities

    -       (4 )     -       (657 )     -  

Net FDIC indemnification asset amortization

    (382 )     (331 )     (268 )     (1,586 )     (1,332 )

Other operating income

    602       1,166       593       1,074       669  

Total noninterest income

    7,096       7,947       7,135       5,475       5,691  

Noninterest expense

                                       

Salaries and employee benefits

    9,441       9,003       9,001       9,022       9,020  

Occupancy expense

    1,250       1,104       1,082       1,341       1,248  

Furniture and equipment expense

    1,046       1,114       1,133       1,087       1,091  

Service fees

    828       703       705       1,095       845  

Interchange expense

    593       577       555       561       517  

Advertising and public relations

    522       506       551       544       605  

Professional fees

    307       589       339       817       822  

Amortization of intangibles

    261       266       266       263       261  

FDIC premiums and assessments

    211       212       227       227       244  

Other operating expense

    3,085       3,058       3,050       2,501       2,430  

Total noninterest expense

    17,544       17,132       16,909       17,458       17,083  

 

Efficiency Ratio

 

EFFICIENCY RATIO CALCULATION (Unaudited)

 

   

Three Months Ended

 
   

March 31,

   

December 31,

   

September 30,

   

June 30,

   

March 31,

 
   

2018

   

2017

   

2017

   

2017

   

2017

 

(Amounts in thousands)

                                       

Noninterest expense, GAAP

  $ 17,544     $ 17,132     $ 16,909     $ 17,458     $ 17,083  

Non-GAAP adjustments

                                       

OREO expense and net loss

    (171 )     (14 )     (647 )     (213 )     (328 )

Other non-core items

    -       -       (64 )     (327 )     -  

Adjusted noninterest expense

    17,373       17,118       16,198       16,918       16,755  
                                         

Net interest income, GAAP

    22,379       21,733       22,050       22,294       21,141  

Noninterest income, GAAP

    7,096       7,947       7,135       5,475       5,691  

Non-GAAP adjustments

                                       

Tax equivalency adjustment

    457       466       470       481       497  

Net loss on sale of securities

    -       4       -       657       -  

Other non-core items

    (130 )     (140 )     (30 )     (501 )     (18 )

Adjusted net interest and noninterest income

    29,802       30,010       29,625       28,406       27,311  
                                         

Non-GAAP efficiency ratio(1)

    58.29 %     57.04 %     54.68 %     59.56 %     61.35 %

GAAP efficiency ratio

    59.52 %     57.72 %     57.94 %     62.87 %     63.67 %

 

 

 

                 

(1)

A non-GAAP financial measure computed by dividing adjusted noninterest expense by the sum of tax equivalent net interest income and adjusted noninterest income

 

7

 

 

Balance Sheet and Capital

CONDENSED CONSOLIDATED QUARTERLY BALANCE SHEETS (Unaudited)

 

   

March 31,

   

December 31,

   

September 30,

   

June 30,

   

March 31,

 

(Amounts in thousands, except per share data)

 

2018

   

2017

   

2017

   

2017

   

2017

 

Assets

                                       

Total cash and cash equivalents

  $ 205,140     $ 157,951     $ 105,119     $ 106,799     $ 152,851  

Securities available for sale

    164,192       165,580       174,424       157,854       158,685  

Securities held to maturity

    25,115       25,149       25,182       25,216       47,092  

Loans held for investment, net of unearned income

                                       

Non-covered

    1,767,703       1,789,236       1,806,434       1,796,263       1,784,371  

Covered

    25,406       27,948       31,287       45,845       51,412  

Less allowance for loan losses

    (19,500 )     (19,276 )     (19,206 )     (18,886 )     (18,458 )

Loans held for investment, net

    1,773,609       1,797,908       1,818,515       1,823,222       1,817,325  

FDIC indemnification asset

    6,884       7,161       7,465       8,159       9,931  

Premises and equipment, net

    46,415       48,126       48,949       49,598       50,057  

Other real estate owned, non-covered

    4,620       2,409       3,543       3,914       4,477  

Other real estate owned, covered

    70       105       54       124       241  

Interest receivable

    5,155       5,778       5,156       5,072       5,059  

Goodwill

    95,779       95,779       95,779       95,779       95,779  

Other intangible assets

    5,891       6,151       6,417       6,683       6,947  

Other assets

    95,437       76,363       84,177       84,183       82,069  

Total assets

  $ 2,428,307     $ 2,388,460     $ 2,374,780     $ 2,366,603     $ 2,430,513  
                                         

Liabilities

                                       

Deposits

                                       

Noninterest-bearing

  $ 460,478     $ 454,143     $ 452,940     $ 443,800     $ 467,677  

Interest-bearing

    1,520,141       1,475,748       1,410,880       1,413,574       1,438,917  

Total deposits

    1,980,619       1,929,891       1,863,820       1,857,374       1,906,594  

Securities sold under agreements to repurchase

    29,115       30,086       83,783       86,011       90,653  

FHLB borrowings

    50,000       50,000       50,000       50,000       65,000  

Other borrowings

    -       -       -       -       244  

Interest, taxes, and other liabilities

    26,536       27,769       24,540       24,443       24,618  

Total liabilities

    2,086,270       2,037,746       2,022,143       2,017,828       2,087,109  
                                         

Stockholders' equity

                                       

Common stock

    21,382       21,382       21,382       21,382       21,382  

Additional paid-in capital

    228,774       228,750       228,510       228,326       228,176  

Retained earnings

    178,227       180,543       182,145       177,556       173,860  

Treasury stock, at cost

    (83,865 )     (79,121 )     (79,333 )     (78,488 )     (78,533 )

Accumulated other comprehensive loss

    (2,481 )     (840 )     (67 )     (1 )     (1,481 )

Total stockholders' equity

    342,037       350,714       352,637       348,775       343,404  

Total liabilities and stockholders' equity

  $ 2,428,307     $ 2,388,460     $ 2,374,780     $ 2,366,603     $ 2,430,513  
                                         

Shares outstanding at period-end

    16,847,452       16,998,226       16,986,502       17,017,071       17,013,185  

Book value per common share

  $ 20.30     $ 20.63     $ 20.76     $ 20.50     $ 20.18  

Tangible book value per common share(1)

    14.27       14.64       14.74       14.47       14.15  

 

 

 

                 

(1)

A non-GAAP financial measure defined as stockholders’ equity less goodwill and other intangibles, divided by common shares outstanding

 

8

 

 

Asset Quality

 

SELECTED CREDIT QUALITY INFORMATION (Unaudited)

 

   

March 31,

   

December 31,

   

September 30,

   

June 30,

   

March 31,

 

(Amounts in thousands)

 

2018

   

2017

   

2017

   

2017

   

2017

 

Allowance for Loan Losses

                                       

Beginning balance

  $ 19,276     $ 19,206     $ 18,886     $ 18,458     $ 17,948  

Provision for loan losses charged to operations

    495       615       730       934       492  

Charge-offs

    (698 )     (967 )     (717 )     (902 )     (357 )

Recoveries

    427       422       307       396       375  

Net (charge-offs) recoveries

    (271 )     (545 )     (410 )     (506 )     18  

Ending balance

  $ 19,500     $ 19,276     $ 19,206     $ 18,886     $ 18,458  
                                         

Nonperforming Assets

                                       

Non-covered nonperforming assets

                                       

Nonaccrual loans

  $ 21,650     $ 18,997     $ 18,942     $ 20,146     $ 18,537  

Accruing loans past due 90 days or more

    27       1       -       -       20  

Troubled debt restructurings ("TDRs")(1)

    77       120       141       100       -  

Total non-covered nonperforming loans

    21,754       19,118       19,083       20,246       18,557  

OREO

    4,620       2,409       3,543       3,914       4,477  

Total non-covered nonperforming assets

  $ 26,374     $ 21,527     $ 22,626     $ 24,160     $ 23,034  
                                         

Covered nonperforming assets

                                       

Nonaccrual loans

  $ 596     $ 342     $ 420     $ 446     $ 918  

Total covered nonperforming loans

    596       342       420       446       918  

OREO

    70       105       54       124       241  

Total covered nonperforming assets

  $ 666     $ 447     $ 474     $ 570     $ 1,159  
                                         

Additional Information

                                       

Performing TDRs(2)

  $ 7,220     $ 7,614     $ 8,101     $ 8,485     $ 8,593  

Total TDRs(3)

    7,297       7,734       8,242       8,585       8,593  
                                         

Non-covered ratios

                                       

Nonperforming loans to total loans

    1.23 %     1.07 %     1.06 %     1.13 %     1.04 %

Nonperforming assets to total assets

    1.10 %     0.91 %     0.97 %     1.04 %     0.97 %

Non-PCI allowance to nonperforming loans

    89.64 %     100.83 %     100.64 %     93.24 %     99.40 %

Non-PCI allowance to total loans

    1.10 %     1.08 %     1.06 %     1.05 %     1.03 %

Annualized net charge-offs to average loans

    0.06 %     0.12 %     0.09 %     0.11 %     0.00 %
                                         

Total ratios

                                       

Nonperforming loans to total loans

    1.25 %     1.07 %     1.06 %     1.12 %     1.06 %

Nonperforming assets to total assets

    1.11 %     0.92 %     0.97 %     1.04 %     1.00 %

Allowance for loan losses to nonperforming loans

    87.25 %     99.05 %     98.48 %     91.27 %     94.78 %

Allowance for loan losses to total loans

    1.09 %     1.06 %     1.05 %     1.03 %     1.01 %

Annualized net charge-offs to average loans

    0.06 %     0.12 %     0.09 %     0.11 %     0.00 %

 

 

 

                 

(1)

Accruing TDRs restructured within the past six months or nonperforming

(2)

Accruing TDRs with six months or more of satisfactory payment performance

(3)

Accruing total TDRs

 

9

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