Toggle SGML Header (+)


Section 1: 8-K (8-K 2018 Q2 EARNINGS RELEASE)

Document





UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

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

Date of Report (Date of earliest event reported)
July 23, 2018


Heartland Financial USA, Inc.
(Exact name of Registrant as specified in its charter)

Commission File Number:
001-15393

Delaware
 
42-1405748
(State or other jurisdiction of incorporation)
 
(I.R.S. Employer Identification Number)

1398 Central Avenue
Dubuque, Iowa 52001
(Address of principal executive offices)

(563) 589-2100
(Registrant's telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

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 (see General Instruction A.2 below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
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 o
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. o








Item 2.02 Results of Operation and Financial Condition

On July 23, 2018, Heartland Financial USA, Inc. issued a press release announcing its earnings for the quarter ended June 30, 2018. A copy of the press release is attached as Exhibit 99.1.

Item 9.01 Financial Statements, Pro Forma Financial Information and Exhibits

(a)
Financial Statements of Business Acquired.

None.

(b)
Pro Forma Financial Information.

None.

(c)
Exhibits.

99.1 Press Release dated July 23, 2018


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.

Date: July 23, 2018
 
HEARTLAND FINANCIAL USA, INC.
 
 
 
 
 
 
By:
/s/ Bryan R. McKeag
 
 
 
Executive Vice President
 
 
 
Chief Financial Officer





(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1 2018 Q2 EARNINGS RELEASE)

Exhibit


394321924_htlfforworkivaa10.jpg
 
394321924_newslogoa53.jpg

CONTACT:
FOR IMMEDIATE RELEASE
Bryan R. McKeag
July 23, 2018
Executive Vice President
 
Chief Financial Officer
 
(563) 589-1994
 
 

HEARTLAND FINANCIAL USA, INC. REPORTS SECOND QUARTER 2018 RESULTS

Highlights
§
Quarterly net income available to common stockholders of $27.9 million in comparison with $21.9 million for the second quarter of the prior year
§
Diluted earnings per common share of $0.85 in comparison with $0.81 for the second quarter of the prior year
§
Net interest margin of 4.23%, fully tax-equivalent (non-GAAP)(1) of 4.30%
§
Organic loan growth of $50.6 million or 3% annualized and organic demand deposit growth of $111.6 million or 14% annualized
§
Return on average common equity of 9.81% and return on average tangible common equity (non-GAAP)(2) of 14.56%
§
Tangible common equity ratio (non-GAAP)(3) of 7.46%
§
Completed the acquisition of First Bank Lubbock Bancshares, Inc. on May 18, 2018
 
Quarter Ended
June 30,
 
Six Months Ended
June 30,
 
2018
 
2017
 
2018
 
2017
Net income (in millions)
$
27.9

 
$
22.0

 
$
51.1

 
$
40.0

Net income available to common stockholders (in millions)
27.9

 
21.9

 
51.1

 
39.9

Diluted earnings per common share
0.85

 
0.81

 
1.61

 
1.49

 
 
 
 
 
 
 
 
Return on average assets
1.05
%
 
1.06
%
 
1.01
%
 
0.97
%
Return on average common equity
9.81

 
11.13

 
9.58

 
10.44

Return on average tangible common equity (non-GAAP)(2)
14.56

 
14.07

 
13.82

 
13.18

Net interest margin
4.23

 
3.94

 
4.21

 
3.95

Net interest margin, fully tax-equivalent (non-GAAP)(1)
4.30

 
4.14

 
4.28

 
4.15

"Heartland's strong financial performance continued during the second quarter of 2018. Net income available to common stockholders was $27.9 million, which was a 27% increase over the same quarter a year ago. "
Lynn B. Fuller, executive operating chairman, Heartland Financial USA, Inc.

(1) Refer to the "Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)" table included in this earnings release.
(2) Refer to the "Reconciliation of Return on Average Tangible Common Equity (non-GAAP)" table included in this earnings release.
(3) Refer to the "Reconciliation of Tangible Common Equity Ratio (non-GAAP)" table included in this earnings release.






Dubuque, Iowa, Monday, July 23, 2018-Heartland Financial USA, Inc. (NASDAQ: HTLF) today reported net income available to common stockholders of $27.9 million, or $0.85 per diluted common share, for the quarter ended June 30, 2018, compared to $21.9 million, or $0.81 per diluted common share, for the second quarter of 2017. Return on average common equity was 9.81% and return on average assets was 1.05% for the second quarter of 2018, compared to 11.13% and 1.06%, respectively, for the same quarter in 2017.

Net income available to common stockholders for the six months ended June 30, 2018, was $51.1 million or $1.61 per diluted common share, compared to $39.9 million or $1.49 per diluted common share for the six months ended June 30, 2017. Return on average common equity was 9.58% and return on average assets was 1.01% for the first six months of 2018, compared to 10.44% and 0.97% for the same period in 2017.

Commenting on Heartland’s second quarter results, Lynn B. Fuller, Heartland’s executive operating chairman, said, "Heartland's strong financial performance continued during the second quarter of 2018. Net income available to common stockholders was $27.9 million, which was a 27% increase over the same quarter a year ago."

On February 23, 2018, Heartland completed the acquisition of Signature Bancshares, Inc., parent company of Signature Bank, based in Minnetonka, Minnesota. Based on Heartland's closing common stock price of $53.55 per share as of February 23, 2018, the aggregate consideration was $61.4 million, with approximately 10% of the consideration paid in cash and 90% paid by delivery of Heartland common stock. Simultaneous with the closing of the transaction, Signature Bank merged into Heartland's Minnesota Bank & Trust subsidiary. As of the closing date, Signature Bancshares, Inc. had, at fair value, total assets of $427.1 million, total loans held to maturity of $324.5 million and total deposits of $357.3 million. The systems conversion for this transaction occurred on April 20, 2018.

On May 18, 2018, Heartland completed the acquisition of Lubbock, Texas based First Bank Lubbock Bancshares, Inc. ("FBLB"), parent company of First Bank & Trust, and PrimeWest Mortgage Corporation, which is a wholly-owned subsidiary of First Bank & Trust. Based on Heartland's closing common stock price of $55.05 per share on May 18, 2018, the aggregate consideration paid to FBLB common shareholders was $189.9 million, with approximately 3% of the consideration paid in cash and 97% paid by delivery of Heartland common stock. As a result of the transaction, First Bank & Trust became a wholly-owned subsidiary of Heartland and its 11th state-chartered bank. First Bank & Trust and PrimeWest Mortgage Corporation continue to operate under their present brands and management teams. As of the closing date, FBLB had, at fair value, total assets of $1.12 billion, total loans held to maturity of $681.1 million and total deposits of $893.8 million. Heartland also assumed, at fair value, $8.2 million of trust preferred debt. The systems conversion for this transaction is expected to occur in the third quarter of 2018.

In the first quarter of 2018, Heartland recorded $2.6 million of restructuring expenses related to its legacy mortgage lending operation. The restructuring projects are primarily related to outsourcing the loan application processing, underwriting and loan closing functions and include a workforce reduction of approximately 100 employees and the discontinuation of several current systems.
Bruce K. Lee, Heartland's president and chief executive officer, stated, "Our mortgage restructuring projects are nearing completion. When completed, we look forward to providing an enhanced customer experience and streamlined operations that will reduce the volatility and cost of originating mortgage loans."
Fully Tax-Equivalent Net Interest Margin Increases from Second Quarter of 2017

Net interest margin, expressed as a percentage of average earning assets, was 4.23% (4.30% on a fully tax-equivalent basis, non-GAAP) during the second quarter of 2018, compared to 4.19% (4.26% on a fully tax-equivalent basis, non-GAAP) during the first quarter of 2018 and 3.94% (4.14% on a fully tax-equivalent basis, non-GAAP) during the second quarter of 2017.

"On a fully tax equivalent basis, net interest margin for the second quarter of 2018 increased 16 basis points to 4.30 percent from 4.14 percent for the second quarter of 2017. The strong margin was driven by an improved earning asset mix and strong demand deposit growth," Lee said.

Total interest income for the second quarter of 2018 was $113.4 million compared to $82.1 million recorded in the second quarter of 2017. The taxable equivalent adjustment for income taxes saved on the interest earned on nontaxable securities and loans was $1.6 million for the second quarter of 2018 and $3.8 million for the second quarter of 2017. With these adjustments, total interest income on a tax-equivalent basis was $115.0 million for the second quarter of 2018, an increase of $29.1 million or 34%, compared to total interest income of $85.9 million for the second quarter





of 2017. Average earning assets increased $2.03 billion or 27% from the second quarter of 2017, which was primarily attributable to the acquisitions completed in the third quarter of 2017 and the first half of 2018. The average rate on earning assets increased 26 basis points to 4.80% for the second quarter of 2018 compared to 4.54% for the same quarter in 2017. The increase in interest income on a tax-equivalent basis was primarily due to recent increases in market interest rates and the increase in average earning assets.

Interest expense on deposits and borrowings for the second quarter of 2018 was $12.0 million, an increase of $4.5 million or 60% from $7.5 million in the second quarter of 2017. Average interest bearing deposits increased $1.08 billion or 23% to $5.79 billion for the quarter ended June 30, 2018, from $4.71 billion in the same quarter in 2017, which was primarily attributable to recent acquisitions. The average interest rate paid on Heartland's interest bearing deposits increased 20 basis points to 0.55% for the second quarter of 2018 compared to 0.35% for the same quarter in 2017. Average borrowings declined $19.8 million or 5% to $415.3 million during the second quarter of 2018 from $435.1 million during the same quarter in 2017. The average interest rate paid on Heartland's borrowings was 3.88% for the second quarter of 2018 compared to 3.06% in the second quarter of 2017. The increase in the average interest rate paid on Heartland's interest bearing liabilities was primarily due to recent increases in market interest rates.

Net interest income was $101.4 million during the second quarter of 2018 compared to $74.6 million during the second quarter of 2017, an increase of $26.8 million or 36%. After the tax-equivalent adjustment discussed above, net interest income on a tax-equivalent basis totaled $103.0 million during the second quarter of 2018 compared to net interest income on a tax-equivalent basis of $78.4 million during the second quarter of 2017, an increase of $24.6 million or 31%.

Noninterest Income and Noninterest Expenses Increase from Second Quarter of 2017

Noninterest income totaled $27.6 million during the second quarter of 2018 compared to $25.6 million during the second quarter of 2017, an increase of $2.0 million or 8%. Service charges and fees increased $2.4 million or 25% to $12.1 million for the second quarter of 2018 compared to $9.7 million for the same quarter of 2017. Service charges related to credit card income increased $806,000 or 37% to $3.0 million for the second quarter of 2018 from $2.2 million for the same quarter of 2017. The remainder of the increase in service charges was primarily attributable to Heartland's larger customer base as a result of recent acquisitions. Securities losses, net, totaled $259,000 for the second quarter of 2018 compared to net securities gains of $1.4 million for the second quarter of 2017. Other noninterest income increased $429,000 or 58% to $1.2 million for the second quarter of 2018 compared to $738,000 for the second quarter of 2017. Included in this increase was $174,000 of reimbursements from customers for loan workout expenses that had been incurred and paid in prior years.

For the second quarter of 2018, noninterest expenses totaled $88.9 million compared to $69.3 million during the second quarter of 2017, an increase of $19.6 million or 28%. Salaries and employee benefits increased $9.6 million or 23% to $50.8 million for the second quarter of 2018 compared to $41.1 million for the same quarter in 2017, which was primarily due to the increase in full time equivalent employees from recent acquisitions. Heartland had 2,216 full time equivalent employees at June 30, 2018, compared to 1,862 full time equivalent employees at June 30, 2017. Advertising expenses increased $786,000 or 58% to $2.1 million for the second quarter of 2018 compared to $1.4 million for the second quarter of 2017, primarily related to increased marketing efforts to support Heartland's expanding footprint. For the second quarter of 2018, losses of $1.5 million were recorded on sales/valuations of assets compared to a net gain of $112,000 for the same quarter of 2017. This increase of $1.6 million was primarily due to write-downs and losses on repossessed assets of $993,000 during the second quarter of 2018.

Heartland's effective tax rate was 21.09% for the second quarter of 2018 compared to 26.85% for the second quarter of 2017. Federal low-income housing tax credits included in the determination of Heartland's income taxes totaled $307,000 during the second quarter of 2018 compared to $310,000 for the second quarter of 2017. Heartland's effective tax rate was also affected by the passage of the Tax Cuts and Jobs Act in December 2017, which reduced the federal income tax rate from a maximum of 35% to 21% beginning January 1, 2018. The level of tax-exempt interest income as a percentage of pre-tax income was 16.77% during the second quarter of 2018 compared to 23.49% during the second quarter of 2017.

Loans and Deposits Increase Since December 31, 2017

Total assets were $11.30 billion at June 30, 2018, an increase of $1.49 billion or 15% from $9.81 billion at year-end 2017. Excluding $427.1 million of assets acquired at fair value in the Signature Bancshares Inc. transaction and $1.12 billion of assets acquired at fair value in the FBLB transaction, total assets decreased $53.1 million or 1% since





December 31, 2017. The decrease in assets was primarily due to a reduction in the securities portfolio, which represented 22% and 25% of total assets at June 30, 2018, and December 31, 2017, respectively.

Total loans held to maturity were $7.48 billion at June 30, 2018, compared to $6.39 billion at year-end 2017, an increase of $1.09 billion or 17%. This change includes $324.5 million of total loans held to maturity acquired at fair value in the Signature Bancshares, Inc. transaction and $681.1 million of total loans held to maturity acquired at fair value in the FBLB transaction. Exclusive of these transactions, total loans held to maturity increased $50.6 million or 3% annualized during the second quarter of 2018 and $80.7 million or 3% annualized for the first six months of 2018.

Total deposits were $9.49 billion as of June 30, 2018, compared to $8.15 billion at year-end 2017, an increase of $1.34 billion or 16%. This increase included $357.3 million of deposits, at fair value, acquired in the Signature Bancshares, Inc. transaction and $893.8 million of deposits, at fair value, acquired in the FBLB transaction. Exclusive of these transactions, total deposits increased $91.1 million or 1% since December 31, 2017. Demand deposits increased $416.5 million or 14% to $3.40 billion at June 30, 2018 compared to $2.98 billion at December 31, 2017. Excluding $299.0 million of demand deposits attributable to the Signature Bancshares, Inc. and FBLB transactions, demand deposits increased $117.5 million or 4% since year-end 2017. Excluding demand deposits acquired in the second quarter of 2018, demand deposits increased $111.6 million or 4% since March 31, 2018. Savings deposits increased $624.4 million or 15% to $4.86 billion at June 30, 2018, from $4.24 billion at December 31, 2017. Excluding savings deposits of $619.0 million acquired in the Signature Bancshares, Inc. and FBLB transactions, savings deposits increased $5.4 million or less than 1% since year-end 2017. Excluding savings deposits acquired in the second quarter of 2018, savings deposits decreased $95.2 million or 2% since March 31, 2018.

"We were encouraged by both organic loan growth of $50.6 million and organic demand deposit growth of $111.6 million in the second quarter. Quality loan and demand deposit growth remain among our top priorities," Lee stated.

Nonperforming Assets Increase Since December 31, 2017

Nonperforming assets were $81.0 million or 0.72% of total assets at June 30, 2018, compared to $74.6 million or 0.76% of total assets at December 31, 2017. Excluding $10.4 million of nonperforming assets acquired in the Signature Bancshares, Inc. and FBLB transactions, nonperforming assets decreased $4.0 million or 5% since year-end 2017. Nonperforming loans were $69.4 million or 0.93% of total loans at June 30, 2018, compared to $63.4 million or 0.99% of total loans at December 31, 2017.

The allowance for loan losses at June 30, 2018, was 0.82% of loans and 88.32% of nonperforming loans, compared to 0.87% of loans and 87.82% of nonperforming loans at December 31, 2017. The provision for loan losses increased $3.9 million to $4.8 million for the second quarter of 2018 compared to $889,000 for the same quarter in 2017. Included in the provision expense for the second quarter of 2018 was $2.1 million of specific reserves related to updated collateral values on two agricultural relationships and two commercial relationships. The remaining increase is attributable to a combination of several factors, including higher loan growth, acquired loans moving out of the purchased accounting pools and general changes in credit quality.


Conference Call Details
Heartland will host a conference call for investors at 5:00 p.m. EDT today. To participate, dial 877-407-0782 at least five minutes before start time. To listen to the live webcast, log on to www.htlf.com at least 15 minutes before start time. A replay will be available until July 22, 2019, by logging on to www.htlf.com.

About Heartland Financial USA, Inc.
Heartland Financial USA, Inc. is a diversified financial services company with assets of $11.3 billion. The company provides banking, mortgage, private client, investment, insurance and consumer finance services to individuals and businesses. Heartland currently has 125 banking locations serving 93 communities in Iowa, Illinois, Wisconsin, New Mexico, Arizona, Montana, Colorado, Minnesota, Kansas, Missouri, Texas and California. Additional information about Heartland Financial USA, Inc. is available at www.htlf.com.

Safe Harbor Statement
This release, and future oral and written statements of Heartland and its management, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about Heartland's financial condition, results of operations, plans, objectives, future performance and business. Although these forward-looking statements are based upon the beliefs, expectations and assumptions of Heartland's management, there are a number





of factors, many of which are beyond the ability of management to control or predict, that could cause actual results to differ materially from those in its forward-looking statements. These factors, which are detailed in the risk factors in Heartland's Annual Report on Form 10-K filed with the Securities and Exchange Commission, contained, among others: (i) the strength of the local and national economy; (ii) the economic impact of past and any future terrorist threats and attacks and any acts of war; (iii) changes in state and federal laws, regulations and governmental policies as they impact the company's general business; (iv) changes in interest rates and prepayment rates of the company's assets; (v) increased competition in the financial services sector and the inability to attract new customers; (vi) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (vii) the potential impact of acquisitions and Heartland's ability to successfully integrate acquired banks; (viii) the loss of key executives or employees; (ix) changes in consumer spending; (x) unexpected outcomes of existing or new litigation involving the company; and (xi) changes in accounting policies and practices. All statements in this release, including forward-looking statements, speak only as of the date they are made, and Heartland undertakes no obligation to update any statement in light of new information or future events.


-FINANCIAL TABLES FOLLOW
-###






HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
For the Quarter Ended
June 30,
 
For the Six Months Ended
June 30,
 
2018
 
2017
 
2018
 
2017
Interest Income
 
 
 
 
 
 
 
Interest and fees on loans
$
96,787

 
$
68,094

 
$
182,438

 
$
134,992

Interest on securities:
 
 
 
 
 
 
 
Taxable
12,270

 
8,599

 
23,847

 
16,852

Nontaxable
3,584

 
5,020

 
7,163

 
10,211

Interest on federal funds sold

 
3

 

 
3

Interest bearing deposits with the Federal Reserve Bank and other banks and other short-term investments
768

 
345

 
1,175

 
554

Total Interest Income
113,409

 
82,061

 
214,623

 
162,612

Interest Expense
 
 
 
 
 
 
 
Interest on deposits
7,983

 
4,163

 
13,749

 
7,893

Interest on short-term borrowings
547

 
90

 
815

 
227

Interest on other borrowings
3,470

 
3,228

 
7,066

 
6,884

Total Interest Expense
12,000

 
7,481

 
21,630

 
15,004

Net Interest Income
101,409

 
74,580

 
192,993

 
147,608

Provision for loan losses
4,831

 
889

 
9,094

 
4,530

Net Interest Income After Provision for Loan Losses
96,578

 
73,691

 
183,899

 
143,078

Noninterest Income
 
 
 
 
 
 
 
Service charges and fees
12,072

 
9,696

 
22,151

 
19,153

Loan servicing income
1,807

 
1,351

 
3,561

 
3,075

Trust fees
4,615

 
3,979

 
9,295

 
7,610

Brokerage and insurance commissions
877

 
976

 
1,784

 
2,012

Securities gains/(losses), net
(259
)
 
1,392

 
1,182

 
3,874

Unrealized gain/(loss) on equity securities, net
71

 

 
43

 

Net gains on sale of loans held for sale
6,800

 
6,817

 
10,851

 
12,964

Valuation adjustment on servicing rights
(216
)
 
19

 
(218
)
 
24

Income on bank owned life insurance
700

 
656

 
1,314

 
1,273

Other noninterest income
1,167

 
738

 
2,387

 
1,532

Total Noninterest Income
27,634

 
25,624

 
52,350

 
51,517

Noninterest Expense
 
 
 
 
 
 
 
Salaries and employee benefits
50,758

 
41,126

 
99,468

 
82,893

Occupancy
6,315

 
5,056

 
12,358

 
10,129

Furniture and equipment
3,184

 
2,586

 
5,933

 
5,087

Professional fees
9,948

 
7,583

 
18,407

 
15,892

FDIC insurance assessments
684

 
909

 
1,673

 
1,716

Advertising
2,145

 
1,359

 
4,085

 
3,783

Core deposit intangibles and customer relationship intangibles amortization
2,274

 
1,218

 
4,137

 
2,389

Other real estate and loan collection expenses
948

 
365

 
1,680

 
1,193

(Gain)/loss on sales/valuations of assets, net
1,528

 
(112
)
 
1,331

 
300

Restructuring expenses

 

 
2,564

 

Other noninterest expenses
11,098

 
9,208

 
20,892

 
17,656

Total Noninterest Expense
88,882

 
69,298

 
172,528

 
141,038

Income Before Income Taxes
35,330

 
30,017

 
63,721

 
53,557

Income taxes
7,451

 
8,059

 
12,574

 
13,589

Net Income
27,879

 
21,958

 
51,147

 
39,968

Preferred dividends
(13
)
 
(13
)
 
(26
)
 
(32
)
Interest expense on convertible preferred debt

 
4

 

 
9

Net Income Available to Common Stockholders
$
27,866

 
$
21,949

 
$
51,121

 
$
39,945

Earnings per common share-diluted
$
0.85

 
$
0.81

 
$
1.61

 
$
1.49

Weighted average shares outstanding-diluted
32,830,751

 
26,972,580

 
31,746,126

 
26,798,134






HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
For the Quarter Ended
 
6/30/2018
 
3/31/2018
 
12/31/2017
 
9/30/2017
 
6/30/2017
Interest Income
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
96,787

 
$
85,651

 
$
86,108

 
$
82,906

 
$
68,094

Interest on securities:
 
 
 
 
 
 
 
 
 
Taxable
12,270

 
11,577

 
11,119

 
10,394

 
8,599

Nontaxable
3,584

 
3,579

 
4,401

 
5,086

 
5,020

Interest on federal funds sold

 

 
5

 
34

 
3

Interest bearing deposits with the Federal Reserve Bank and other banks and other short-term investments
768

 
407

 
435

 
558

 
345

Total Interest Income
113,409

 
101,214

 
102,068

 
98,978

 
82,061

Interest Expense
 
 
 
 
 
 
 
 
 
Interest on deposits
7,983

 
5,766

 
5,313

 
5,073

 
4,163

Interest on short-term borrowings
547

 
268

 
180

 
271

 
90

Interest on other borrowings
3,470

 
3,596

 
3,719

 
3,790

 
3,228

Total Interest Expense
12,000

 
9,630

 
9,212

 
9,134

 
7,481

Net Interest Income
101,409

 
91,584

 
92,856

 
89,844

 
74,580

Provision for loan losses
4,831

 
4,263

 
5,328

 
5,705

 
889

Net Interest Income After Provision for Loan Losses
96,578

 
87,321

 
87,528

 
84,139

 
73,691

Noninterest Income
 
 
 
 
 
 
 
 
 
Service charges and fees
12,072

 
10,079

 
9,892

 
10,138

 
9,696

Loan servicing income
1,807

 
1,754

 
1,400

 
1,161

 
1,351

Trust fees
4,615

 
4,680

 
4,336

 
3,872

 
3,979

Brokerage and insurance commissions
877

 
907

 
1,071

 
950

 
976

Securities gains/(losses), net
(259
)
 
1,441

 
1,420

 
1,679

 
1,392

Unrealized gain/(loss) on equity securities, net
71

 
(28
)
 

 

 

Net gains on sale of loans held for sale
6,800

 
4,051

 
4,290

 
4,997

 
6,817

Valuation adjustment on servicing rights
(216
)
 
(2
)
 
(8
)
 
5

 
19

Income on bank owned life insurance
700

 
614

 
733

 
766

 
656

Other noninterest income
1,167

 
1,220

 
2,394

 
1,409

 
738

Total Noninterest Income
27,634

 
24,716

 
25,528

 
24,977

 
25,624

Noninterest Expense
 
 
 
 
 
 
 
 
 
Salaries and employee benefits
50,758

 
48,710

 
43,289

 
45,225

 
41,126

Occupancy
6,315

 
6,043

 
5,892

 
6,223

 
5,056

Furniture and equipment
3,184

 
2,749

 
3,148

 
2,826

 
2,586

Professional fees
9,948

 
8,459

 
8,537

 
8,450

 
7,583

FDIC insurance assessments
684

 
989

 
985

 
894

 
909

Advertising
2,145

 
1,940

 
2,088

 
1,358

 
1,359

Core deposit intangibles and customer relationship intangibles amortization
2,274

 
1,863

 
1,825

 
1,863

 
1,218

Other real estate and loan collection expenses
948

 
732

 
687

 
581

 
365

(Gain)/loss on sales/valuations of assets, net
1,528

 
(197
)
 
833

 
1,342

 
(112
)
Restructuring expenses

 
2,564

 

 

 

Other noninterest expenses
11,098

 
9,794

 
10,594

 
9,997

 
9,208

Total Noninterest Expense
88,882

 
83,646

 
77,878

 
78,759

 
69,298

Income Before Income Taxes
35,330

 
28,391

 
35,178

 
30,357

 
30,017

Income taxes
7,451

 
5,123

 
21,506

 
8,725

 
8,059

Net Income
27,879

 
23,268

 
13,672

 
21,632

 
21,958

Preferred dividends
(13
)
 
(13
)
 
(13
)
 
(13
)
 
(13
)
Interest expense on convertible preferred debt

 

 

 
3

 
4

Net Income Available to Common Stockholders
$
27,866

 
$
23,255

 
$
13,659

 
$
21,622

 
$
21,949

Earnings per common share-diluted
$
0.85

 
$
0.76

 
$
0.45

 
$
0.72

 
$
0.81

Weighted average shares outstanding-diluted
32,830,751

 
30,645,212

 
30,209,043

 
29,910,437

 
26,972,580







HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
As of
 
6/30/2018
 
3/31/2018
 
12/31/2017
 
9/30/2017
 
6/30/2017
Assets
 
 
 
 
 
 
 
 
 
Cash and due from banks
$
193,069

 
$
143,071

 
$
168,723

 
$
180,751

 
$
141,100

Interest bearing deposits with the Federal Reserve Bank and other banks and other short-term investments
194,937

 
123,275

 
27,280

 
70,985

 
40,676

Cash and cash equivalents
388,006

 
266,346

 
196,003

 
251,736

 
181,776

Time deposits in other financial institutions
6,803

 
6,297

 
9,820

 
19,793

 
30,241

Securities:
 
 
 
 
 
 
 
 
 
Carried at fair value
2,197,117

 
2,027,665

 
2,216,753

 
2,093,385

 
1,789,441

Held to maturity, at cost
244,271

 
249,766

 
253,550

 
256,355

 
259,586

Other investments, at cost
26,725

 
22,982

 
22,563

 
23,176

 
21,094

Loans held for sale
55,684

 
24,376

 
44,560

 
35,795

 
48,848

Loans:
 
 
 
 
 
 
 
 
 
Held to maturity
7,477,697

 
6,746,015

 
6,391,464

 
6,373,415

 
5,325,082

 Allowance for loan losses
(61,324
)
 
(58,656
)
 
(55,686
)
 
(54,885
)
 
(54,051
)
Loans, net
7,416,373

 
6,687,359

 
6,335,778

 
6,318,530

 
5,271,031

Premises, furniture and equipment, net
199,959

 
172,862

 
174,301

 
178,961

 
163,003

Goodwill
391,668

 
270,305

 
236,615

 
236,615

 
141,461

Core deposit intangibles and customer relationship intangibles, net
52,698

 
41,063

 
35,203

 
37,028

 
22,850

Servicing rights, net
31,996

 
25,471

 
25,857

 
26,599

 
34,736

Cash surrender value on life insurance
159,302

 
143,444

 
142,818

 
142,073

 
120,281

Other real estate, net
11,074

 
11,801

 
10,777

 
13,226

 
9,269

Other assets
120,244

 
106,126

 
106,141

 
122,355

 
111,104

Total Assets
$
11,301,920

 
$
10,055,863

 
$
9,810,739

 
$
9,755,627

 
$
8,204,721

Liabilities and Equity
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
 
 
 
 Demand
$
3,399,598

 
$
3,094,457

 
$
2,983,128

 
$
3,009,940

 
$
2,355,410

 Savings
4,864,773

 
4,536,106

 
4,240,328

 
4,227,340

 
3,704,579

 Time
1,224,773

 
910,977

 
923,453

 
994,604

 
870,180

Total deposits
9,489,144

 
8,541,540

 
8,146,909

 
8,231,884

 
6,930,169

Short-term borrowings
229,890

 
131,240

 
324,691

 
171,871

 
139,130

Other borrowings
258,708

 
276,118

 
285,011

 
301,473

 
281,096

Accrued expenses and other liabilities
68,431

 
55,460

 
62,671

 
68,715

 
48,356

Total Liabilities
10,046,173

 
9,004,358

 
8,819,282

 
8,773,943

 
7,398,751

Stockholders' Equity
 
 
 
 
 
 
 
 
 
Preferred equity
938

 
938

 
938

 
938

 
938

Common stock
34,438

 
31,068

 
29,953

 
29,946

 
26,701

Capital surplus
740,128

 
557,990

 
503,709

 
503,262

 
352,500

Retained earnings
524,786

 
500,959

 
481,331

 
468,556

 
450,228

Accumulated other comprehensive loss
(44,543
)
 
(39,450
)
 
(24,474
)
 
(21,018
)
 
(24,397
)
Total Equity
1,255,747

 
1,051,505

 
991,457

 
981,684

 
805,970

Total Liabilities and Equity
$
11,301,920

 
$
10,055,863

 
$
9,810,739

 
$
9,755,627

 
$
8,204,721







HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA

For the Quarter Ended
June 30,

For the Six Months Ended
June 30,
2018

2017

2018

2017
Average Balances







Assets
$
10,643,306


$
8,333,301


$
10,204,061


$
8,283,681

Loans, net of unearned
7,123,182


5,376,826


6,826,018


5,371,271

Deposits
9,018,945


7,050,126


8,637,165


6,973,897

Earning assets
9,614,800


7,586,256


9,238,391


7,544,609

Interest bearing liabilities
6,205,187


5,146,243


5,951,175


5,168,475

Common stockholders' equity
1,139,876


791,039


1,076,083


771,464

Total stockholders' equity
1,140,814


791,977


1,077,021


772,575

Tangible common stockholders' equity(1)
767,732


625,929


745,937


611,050









Key Performance Ratios







Annualized return on average assets
1.05
%

1.06
%

1.01
%

0.97
%
Annualized return on average common equity (GAAP)
9.81
%

11.13
%

9.58
%

10.44
%
Annualized return on average tangible common equity (non-GAAP)(2)
14.56
%

14.07
%

13.82
%

13.18
%
Annualized ratio of net charge-offs to average loans
0.12
%

0.14
%

0.11
%

0.18
%
Annualized net interest margin (GAAP)
4.23
%

3.94
%

4.21
%

3.95
%
Annualized net interest margin, fully tax-equivalent (non-GAAP)(3)
4.30
%

4.14
%

4.28
%

4.15
%
Efficiency ratio, fully tax-equivalent(4)
65.04
%

65.61
%

66.53
%

67.75
%








Reconciliation of Return on Average Tangible Common Equity (non-GAAP)(5)







Net income available to common shareholders (GAAP)
$
27,866


$
21,949


$
51,121


$
39,945









Average common stockholders' equity (GAAP)
$
1,139,876


$
791,039


$
1,076,083


$
771,464

Less average goodwill
325,781


141,461


288,185


136,976

Less average core deposit intangibles and customer relationship intangibles, net
46,363


23,649


41,961


23,438

Average tangible common equity (non-GAAP)
$
767,732


$
625,929


$
745,937


$
611,050

Annualized return on average common equity (GAAP)
9.81
%

11.13
%

9.58
%

10.44
%
Annualized return on average tangible common equity (non-GAAP)
14.56
%

14.07
%

13.82
%

13.18
%








Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)(6)







Net Interest Income (GAAP)
$
101,409


$
74,580


$
192,993


$
147,608

Plus tax-equivalent adjustment(7)
1,575


3,796


3,119


7,656

Net interest income, tax-equivalent (non-GAAP)
$
102,984


$
78,376


$
196,112


$
155,264









Average earning assets
$
9,614,800


$
7,586,256


$
9,238,391


$
7,544,609









Annualized net interest margin (GAAP)
4.23
%

3.94
%

4.21
%

3.95
%
Annualized net interest margin, fully tax-equivalent (non-GAAP)
4.30
%

4.14
%

4.28
%

4.15
%








(1) Calculated as common stockholders' equity less goodwill and core deposit intangibles and customer relationship intangibles, net.
(2) Refer to the "Reconciliation of Return on Average Tangible Common Equity (non-GAAP)" table.
(3) Refer to the "Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)" table.
(4) Refer to the "Reconciliation of Non-GAAP Measure-Efficiency Ratio" table that follows for details of this non-GAAP measure.
(5) Return on average tangible common equity is net income available to common stockholders divided by average common stockholders' equity less goodwill and core deposit intangibles and customer deposit intangibles, net. This financial measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength. This measure should not be considered a substitute for operating results determined in accordance with GAAP.
(6) Annualized net interest margin, fully tax-equivalent is a non-GAAP measure, which adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources. This measure should not be considered a substitute for operating results determined in accordance with GAAP.
(7) Computed on a tax-equivalent basis using an effective tax rate of 21% beginning January 1, 2018, and 35% for all prior periods.






HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
For the Quarter Ended
 
6/30/2018
 
3/31/2018
 
12/31/2017
 
9/30/2017
 
6/30/2017
Average Balances
 
 
 
 
 
 
 
 
 
Assets
$
10,643,306

 
$
9,759,936

 
$
9,807,621

 
$
9,639,844

 
$
8,333,301

Loans, net of unearned
7,123,182

 
6,525,553

 
6,343,923

 
6,286,264

 
5,376,826

Deposits
9,018,945

 
8,251,140

 
8,293,006

 
8,100,028

 
7,050,126

Earning assets
9,614,800

 
8,857,801

 
8,891,432

 
8,726,228

 
7,586,256

Interest bearing liabilities
6,205,187

 
5,694,337

 
5,663,816

 
5,697,713

 
5,146,243

Common stockholders' equity
1,139,876

 
1,011,580

 
986,026

 
954,511

 
791,039

Total stockholders' equity
1,140,814

 
1,012,518

 
986,964

 
955,449

 
791,977

Tangible common stockholders' equity(1)
767,732

 
723,898

 
713,018

 
691,464

 
625,929

 
 
 
 
 
 
 
 
 
 
Key Performance Ratios
 
 
 
 
 
 
 
 
 
Annualized return on average assets
1.05
%
 
0.97
%
 
0.55
%
 
0.89
%
 
1.06
%
Annualized return on average common equity (GAAP)
9.81
%
 
9.32
%
 
5.50
%
 
8.99
%
 
11.13
%
Annualized return on average tangible common equity (non-GAAP)(2)
14.56
%
 
13.03
%
 
7.60
%
 
12.41
%
 
14.07
%
Annualized ratio of net charge-offs to average loans
0.12
%
 
0.08
%
 
0.28
%
 
0.31
%
 
0.14
%
Annualized net interest margin (GAAP)
4.23
%
 
4.19
%
 
4.14
%
 
4.08
%
 
3.94
%
Annualized net interest margin, fully tax-equivalent (non-GAAP)(3)
4.30
%
 
4.26
%
 
4.30
%
 
4.26
%
 
4.14
%
Efficiency ratio, fully tax-equivalent(4)
65.04
%
 
68.21
%
 
62.26
%
 
64.54
%
 
65.61
%
 
 
 
 
 
 
 
 
 
 
Reconciliation of Return on Average Tangible Common Equity (non-GAAP)(5)
 
 
 
 
 
 
 
 
 
Net income available to common shareholders (GAAP)
$
27,866

 
$
23,255

 
$
13,659

 
$
21,622

 
$
21,949

 
 
 
 
 
 
 
 
 
 
Average common stockholders' equity (GAAP)
$
1,139,876

 
$
1,011,580

 
$
986,026

 
$
954,511

 
$
791,039

   Less average goodwill
325,781

 
250,172

 
236,615

 
226,097

 
141,461

Less average core deposit intangibles and customer relationship intangibles, net
46,363

 
37,510

 
36,393

 
36,950

 
23,649

Average tangible common equity (non-GAAP)
$
767,732

 
$
723,898

 
$
713,018

 
$
691,464

 
$
625,929

Annualized return on average common equity (GAAP)
9.81
%
 
9.32
%
 
5.50
%
 
8.99
%
 
11.13
%
Annualized return on average tangible common equity (non-GAAP)
14.56
%
 
13.03
%
 
7.60
%
 
12.41
%
 
14.07
%
 
 
 
 
 
 
 
 
 
 
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)(6)
 
 
 
 
 
 
 
 
 
Net Interest Income (GAAP)
$
101,409

 
$
91,584

 
$
92,856

 
$
89,844

 
$
74,580

    Plus tax-equivalent adjustment(7)
1,575

 
1,544

 
3,558

 
3,925

 
3,796

Net interest income, fully tax-equivalent (non-GAAP)
$
102,984

 
$
93,128

 
$
96,414

 
$
93,769

 
$
78,376

 
 
 
 
 
 
 
 
 
 
Average earning assets
$
9,614,800

 
$
8,857,801

 
$
8,891,432

 
$
8,726,228

 
$
7,586,256

 
 
 
 
 
 
 
 
 
 
Annualized net interest margin (GAAP)
4.23
%
 
4.19
%
 
4.14
%
 
4.08
%
 
3.94
%
Annualized net interest margin, fully tax-equivalent (non-GAAP)
4.30
%
 
4.26
%
 
4.30
%
 
4.26
%
 
4.14
%
 
(1) Calculated as common stockholders' equity less goodwill and core deposit intangibles and customer relationship intangibles, net.
(2) Refer to the "Reconciliation of Return on Average Tangible Common Equity (non-GAAP)" table.
(3) Refer to the "Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)" table.
(4) Refer to the "Reconciliation of Non-GAAP Measure-Efficiency Ratio" table that follows for details of this non-GAAP measure.
(5) Return on average common tangible equity is net income available to common stockholders divided by average common stockholders' equity less goodwill and core deposit intangibles and customer relationship intangibles, net. This financial measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength. This measure should not be considered a substitute for operating results determined in accordance with GAAP.
(6) Annualized net interest margin, fully tax-equivalent is a non-GAAP measure, which adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources. This measure should not be considered a substitute for operating results determined in accordance with GAAP.
(7) Computed on a tax-equivalent basis using an effective tax rate of 21% beginning January 1, 2018, and 35% for all prior periods.





HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA

For the Quarter Ended
June 30,

For the Six Months Ended
June 30,
Reconciliation of Non-GAAP Measure-Efficiency Ratio(1)
2018

2017

2018

2017
Net interest income
$
101,409


$
74,580


$
192,993


$
147,608

Tax-equivalent adjustment(2)
1,575


3,796


3,119


7,656

Fully tax-equivalent net interest income
102,984


78,376

 
196,112

 
155,264

Noninterest income
27,634


25,624


52,350


51,517

Securities (gains)/losses, net
259


(1,392
)

(1,182
)

(3,874
)
Unrealized (gain)/loss on equity securities, net
(71
)
 

 
(43
)
 

Adjusted income
$
130,806

 
$
102,608

 
$
247,237

 
$
202,907













Total noninterest expenses
$
88,882


$
69,298


$
172,528


$
141,038

Less:










Core deposit intangibles and customer relationship intangibles amortization
2,274


1,218


4,137


2,389

Partnership investment in tax credit projects


876




876

(Gain)/loss on sales/valuations of assets, net
1,528


(112
)

1,331


300

   Restructuring expenses

 

 
2,564

 

Adjusted noninterest expenses
$
85,080

 
$
67,316

 
$
164,496

 
$
137,473









Efficiency ratio, fully tax-equivalent (non-GAAP)
65.04
%

65.61
%

66.53
%

67.75
%
Reconciliation of Non-GAAP Measure-Efficiency Ratio(1)
For the Quarter Ended
6/30/2018
 
3/31/2018
 
12/31/2017
 
9/30/2017
 
6/30/2017
Net interest income
$
101,409

 
$
91,584

 
$
92,856

 
$
89,844

 
$
74,580

Tax-equivalent adjustment(2)
1,575

 
1,544

 
3,558

 
3,925

 
3,796

Fully tax-equivalent net interest income
102,984

 
93,128

 
96,414

 
93,769

 
78,376

Noninterest income
27,634

 
24,716

 
25,528

 
24,977

 
25,624

Securities (gains)/losses, net
259

 
(1,441
)
 
(1,420
)
 
(1,679
)
 
(1,392
)
Unrealized (gain)/loss on equity securities, net
(71
)
 
28

 

 

 

Gain on extinguishment of debt

 

 
(1,280
)
 

 

Adjusted income
$
130,806

 
$
116,431

 
$
119,242

 
$
117,067

 
$
102,608

 
 
 
 
 
 
 
 
 
 
Total noninterest expenses
$
88,882

 
$
83,646

 
$
77,878

 
$
78,759

 
$
69,298

Less:
 
 
 
 
 
 
 
 
 
Core deposit intangibles and customer relationship intangibles amortization
2,274

 
1,863

 
1,825

 
1,863

 
1,218

Partnership investment in tax credit projects

 

 
984

 

 
876

(Gain)/loss on sales/valuation of assets, net
1,528

 
(197
)
 
833

 
1,342

 
(112
)
   Restructuring expenses

 
2,564

 

 

 

Adjusted noninterest expenses
$
85,080

 
$
79,416

 
$
74,236

 
$
75,554

 
$
67,316

 
 
 
 
 
 
 
 
 
 
Efficiency ratio, fully tax-equivalent (non-GAAP)
65.04
%
 
68.21
%
 
62.26
%
 
64.54
%
 
65.61
%
 
 
 
 
 
 
 
 
 
 
(1) Efficiency ratio, fully tax-equivalent, expresses noninterest expenses as a percentage of fully tax-equivalent net interest income and noninterest income. This efficiency ratio is presented on a tax-equivalent basis, which adjusts net interest income and noninterest expenses for the tax favored status of certain loans, securities and tax credit projects. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results as it enhances the comparability of income and expenses arising from taxable and nontaxable sources and excludes specific items, as noted in the table. This measure should not be considered a substitute for operating results determined in accordance with GAAP.
(2) Computed on a tax-equivalent basis using an effective tax rate of 21% beginning January 1, 2018, and 35% for all prior periods.






HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE AND FULL TIME EQUIVALENT EMPLOYEE DATA
 
As of and for the Quarter Ended
 
6/30/2018
 
3/31/2018
 
12/31/2017
 
9/30/2017
 
6/30/2017
Common Share Data
 
 
 
 
 
 
 
 
 
Book value per common share
$
36.44

 
$
33.81

 
$
33.07

 
$
32.75

 
$
30.15

Tangible book value per common share (non-GAAP)(1)
$
23.53

 
$
23.79

 
$
23.99

 
$
23.61

 
$
24.00

Common shares outstanding, net of treasury stock
34,438,445

 
31,068,239

 
29,953,356

 
29,946,069

 
26,701,226

Tangible common equity ratio (non-GAAP)(2)
7.46
%
 
7.59
%
 
7.53
%
 
7.46
%
 
7.97
%
 
 
 
 
 
 
 
 
 
 
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(3)
 
 
 
 
 
 
 
 
 
Common stockholders' equity (GAAP)
$
1,254,809

 
$
1,050,567

 
$
990,518

 
$
980,746

 
$
805,032

Less goodwill
391,668

 
270,305

 
236,615

 
236,615

 
141,461

Less core deposit intangibles and customer relationship intangibles, net
52,698

 
41,063

 
35,203

 
37,028

 
22,850

Tangible common stockholders' equity (non-GAAP)
$
810,443

 
$
739,199

 
$
718,700

 
$
707,103

 
$
640,721

 
 
 
 
 
 
 
 
 
 
Common shares outstanding, net of treasury stock
34,438,445

 
31,068,239

 
29,953,356

 
29,946,069

 
26,701,226

Common stockholders' equity (book value) per share (GAAP)
$
36.44

 
$
33.81

 
$
33.07

 
$
32.75

 
$
30.15

Tangible book value per common share (non-GAAP)
$
23.53

 
$
23.79

 
$
23.99

 
$
23.61

 
$
24.00

 
 
 
 
 
 
 
 
 
 
Reconciliation of Tangible Common Equity Ratio (non-GAAP)(4)
 
 
 
 
 
 
 
 
 
Total assets (GAAP)
$
11,301,920

 
$
10,055,863

 
$
9,810,739

 
$
9,755,627

 
$
8,204,721

    Less goodwill
391,668

 
270,305

 
236,615

 
236,615

 
141,461

 Less core deposit intangibles and customer relationship
 intangibles, net
52,698

 
41,063

 
35,203

 
37,028

 
22,850

Total tangible assets (non-GAAP)
$
10,857,554

 
$
9,744,495

 
$
9,538,921

 
$
9,481,984

 
$
8,040,410

Tangible common equity ratio (non-GAAP)
7.46
%
 
7.59
%
 
7.53
%
 
7.46
%
 
7.97
%
 
 
 
 
 
 
 
 
 
 
Loan Data
 
 
 
 
 
 
 
 
 
Loans held to maturity:
 
 
 
 
 
 
 
 
 
Commercial and commercial real estate
$
5,721,138

 
$
5,129,777

 
$
4,809,875

 
$
4,777,856

 
$
3,803,011

Residential mortgage
683,051

 
624,725

 
624,279

 
635,611

 
596,385

Agricultural and agricultural real estate
562,353

 
518,386

 
511,588

 
511,764

 
495,243

Consumer
512,899

 
474,929

 
447,484

 
450,088

 
431,052

Unearned discount and deferred loan fees
(1,744
)
 
(1,802
)
 
(1,762
)
 
(1,904
)
 
(609
)
Total loans held to maturity
$
7,477,697

 
$
6,746,015

 
$
6,391,464

 
$
6,373,415

 
$
5,325,082

 
 
 
 
 
 
 
 
 
 
Other Selected Trend Information
 
 
 
 
 
 
 
 
 
Effective tax rate
21.09
%
 
18.04
%
 
61.13
%
 
28.74
%
 
26.85
%
Full time equivalent employees
2,216

 
2,022

 
2,008

 
2,024

 
1,862

Total residential mortgage loan applications
$
341,978

 
$
234,825

 
$
232,946

 
$
271,476

 
$
308,113

Residential mortgage loans originated
$
225,563

 
$
149,768

 
$
185,580