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Section 1: 8-K (8-K)

Document


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): January 29, 2020

HOMETRUST BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
 
Maryland
 
001-35593
 
45-5055422
(State or other jurisdiction of incorporation)
 
(Commission File No.)
 
(IRS Employer Identification Number)

10 Woodfin Street, Asheville, North Carolina
 
 
 
28801
(Address of principal executive offices)
 
 
 
(Zip Code)

Registrant's telephone number, including area code: (828) 259-3939

 
 
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:

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.
[ ]
Securities Registered Pursuant to Section 12(b) of the Act:
Title of Each Class
Trading Symbol
Name of Each Exchange on Which Registered
Common Stock, par value $0.01 per share
HTBI
The NASDAQ Stock Market LLC





Item 2.02.  Results of Operations and Financial Condition
 
On January 29, 2020, HomeTrust Bancshares, Inc., the holding company for HomeTrust Bank, issued a press release reporting second quarter 2020 financial results.  A copy of the press release, including unaudited financial information released as a part thereof, is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated by reference herein.
 
Item 9.01  Financial Statements and Exhibits
 
(d)           Exhibits
 
Press release dated January 29, 2020


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.

HOMETRUST BANCSHARES, INC.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Date: January 29, 2020
 
By:
/s/ Tony J. VunCannon
 
 
 
Tony J. VunCannon
 
 
 
Executive Vice President, Chief Financial Officer, Corporate Secretary and Treasurer



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit


402499410_htbiimagea24.jpg

HomeTrust Bancshares, Inc. Reports Financial Results For The Second Quarter Of Fiscal 2020

ASHEVILLE, N.C., January 29, 2020 – HomeTrust Bancshares, Inc. (NASDAQ: HTBI) ("Company"), the holding company of HomeTrust Bank ("Bank"), today announced preliminary net income for the second quarter of fiscal 2020 increased 14.3% to $9.2 million, or $0.52 per diluted share compared to $8.0 million, or $0.43 per diluted share for the same period a year ago. Net income increased 13.7% to $18.0 million, or $1.01 per diluted share for the six months ended December 31, 2019, compared to $15.8 million, or $0.84 per diluted share for the first six months of fiscal year 2019. Earnings for the three and six months ended December 31, 2019 included a $958,000 after tax gain from the sale of $154.9 million in one-to-four family loans previously reported as held for sale to shift the Company's loan mix and lower its loan to deposit ratio.
Highlights for the quarter ended December 31, 2019 compared to the corresponding quarter in the previous year are as follows:
return on assets ("ROA") increased 7.4% to 1.02% from 0.95%;
return on equity ("ROE") increased 13.3% to 8.87% from 7.83%;
noninterest income increased $4.0 million, or 78.4% to $9.1 million from $5.1 million;
noninterest income net of the gain on the previously discussed loan sale increased $2.7 million, or 52.9% to $7.8 million from $5.1 million;
organic net loan growth, which excludes one-to-four family loans transferred to held for sale and purchases of home equity lines of credit, was $41.4 million, or 6.9% annualized compared to $57.3 million, or 9.4% annualized;
gain on sale of Small Business Administration ("SBA") loans increased $742,000, or 251.3% to $1.0 million from $295,000;
207,261 shares were repurchased during the quarter at an average price of $26.15 per share; and
quarterly cash dividends increased 16.7% to $0.07 per share totaling $1.2 million.
Highlights for the six months ended December 31, 2019 compared to the corresponding period in the previous year are as follows:
ROA increased 5.3% to 1.00% from 0.95%;
ROE increased 13.4% to 8.72% from 7.69%;
noninterest income increased $6.0 million, or 56.4% to $16.7 million from $10.7 million;
noninterest income net of the gain on the previously discussed loan sale increased $4.7 million, or 44.3% to $15.4 million from $10.7 million;
organic net loan growth was $114.4 million, or 8.8% compared to $134.1 million, or 11.4%;
gain on sale of SBA loans increased $871,000, or 73.0% to $2.1 million from $1.2 million;
total deposits increased $230.5 million, or 9.9% to $2.6 billion from $2.3 billion; and
396,421 shares of common stock were repurchased during the period at an average price of $25.78 per share.
“Despite the industry wide pressure from the interest rate environment, we have continued to deliver strong results through the first half of fiscal 2020," said Dana Stonestreet, Chairman, President, and Chief Executive Officer. "I could not be prouder of our talented and dedicated HomeTrust team that continues to take all our existing and new SBA and equipment finance lines of business to higher performing levels. In the second half of fiscal 2020, we look forward to the conversion of our core technology system to improve customer experience, operational efficiencies, and scalability. Keeping our infrastructure strong is critical to our continued growth and sustainability as we execute our strategic plan to increase revenues, earnings per share and shareholder value."
Income Statement Review
Net interest income decreased slightly to $27.0 million for the quarter ended December 31, 2019, compared to $27.1 million for the comparative quarter in fiscal 2019. The $67,000, or 0.2% decrease was due to a $1.5 million increase in interest and dividend

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income primarily driven by an increase in average interest-earning assets, which was more than offset by a $1.6 million increase in interest expense. Average interest-earning assets increased $219.6 million, or 7.0% to $3.3 billion for the quarter ended December 31, 2019 compared to $3.1 billion for the corresponding quarter in fiscal 2019. For the quarter ended December 31, 2019, the average balance of total loans receivable increased $172.3 million, or 6.6% compared to the same quarter last year primarily due to organic loan growth. The average balance of commercial paper and deposits in other banks increased $33.2 million, or 10.6% between the periods driven by increases in commercial paper investments. The average balance in securities available for sale increased $13.8 million, or 9.1%, which was primarily driven by the purchase of shorter-term corporate bonds. These increases were mainly funded by a portion of the $204.2 million, or 7.9% increase in average interest-bearing liabilities, as compared to the same quarter last year. Net interest margin (on a fully taxable-equivalent basis) for the three months ended December 31, 2019 decreased to 3.27% from 3.51% for the same period a year ago.
Total interest and dividend income increased $1.5 million, or 4.3% for the three months ended December 31, 2019 as compared to the same period last year, which was primarily driven by a $1.6 million, or 5.2% increase in loan interest income and a $217,000, or 24.8% increase in interest income from securities available for sale which was partially offset by a $242,000, or 23.9% decrease in other investment income. The additional loan interest income was primarily driven by an increase in the average balance of loans receivable partially offset by a decrease in loan yields. Average loan yields decreased six basis points to 4.66% for the quarter ended December 31, 2019 from 4.72% in the corresponding quarter last year. For the quarters ended December 31, 2019 and 2018, average loan yields included five and 13 basis points, respectively, from the accretion of purchase discounts on acquired loans. The incremental accretion and the impact to the yield on loans may change during any period based on the volume of prepayments, but it is expected to decrease over time as the balance of the purchase discount for acquired loans decreases. The total purchase discount for acquired loans was $5.9 million at December 31, 2019, compared to $6.7 million at June 30, 2019, and $7.7 million at December 31, 2018.
Total interest expense increased $1.6 million, or 21.4% for the quarter ended December 31, 2019 compared to the same period last year. The increase was driven by a $2.7 million, or 75.2% increase in deposit interest expense partially offset by a $1.2 million, or 31.2% decrease in interest expense on borrowings. The additional deposit interest expense was a result of our continued focus on increasing deposits as the average balance of interest-bearing deposits increased $272.5 million, or 14.2% along with a 41 basis point increase in the average cost of interest-bearing deposits for the quarter ended December 31, 2019 compared to the same quarter last year. Average borrowings for the quarter ended December 31, 2019 decreased $68.3 million, or 10.1% along with a 51 basis point decrease in the average cost of borrowings compared to the same period last year. Borrowings were paid down utilizing proceeds from the previously mentioned one-to-four family loan sale. The decrease in the average cost of borrowing was driven by the lower federal funds rate during the current quarter compared to the prior year. The overall average cost of funds increased 14 basis points to 1.27% for the current quarter compared to 1.13% in the same quarter last year due primarily to the impact of the deposit market interest rate increases on our interest-bearing liabilities.
Net interest income increased to $54.1 million for the six months ended December 31, 2019, compared to $53.4 million for the comparative period in fiscal 2019. The $734,000, or 1.4% increase was due to a $5.5 million increase in interest and dividend income primarily driven by an increase in average interest-earning assets, which was partially offset by a $4.7 million increase in interest expense. Average interest-earning assets increased $220.3 million, or 7.1% to $3.3 billion for the six months ended December 31, 2019 compared to $3.1 billion for the corresponding period in fiscal 2019. For the six months ended December 31, 2019, the average balance of total loans receivable increased $181.9 million, or 7.0% compared to the same period last year primarily due to organic loan growth. The average balance of commercial paper and deposits in other banks increased $37.5 million, or 11.8% between the periods driven by increases in commercial paper investments. These increases were primarily funded by the $221.8 million, or 8.7% increase in average interest-bearing liabilities, as compared to the same six month period last year. Net interest margin (on a fully taxable-equivalent basis) for the six months ended December 31, 2019 decreased to 3.30% from 3.48% for the same period a year ago.
Total interest and dividend income increased $5.5 million, or 8.2% for the six months ended December 31, 2019 as compared to the same period last year, which was primarily driven by a $5.1 million, or 8.6% increase in loan interest income, a $257,000, or 14.8% increase in interest income from securities available for sale, and a $342,000, or 8.9% increase in interest income from commercial paper and interest-bearing deposits, which was partially offset by a $249,000, or 13.4% decrease in other investment income. The additional loan interest income was driven by increases in both the average balance of loans receivable and loan yields compared to the prior year. Average loan yields increased seven basis points to 4.70% for the six months ended December 31, 2019 from 4.63% in the corresponding period last year. For the six months ended December 31, 2019 and 2018, average loan yields included six and nine basis points, respectively, from the accretion of purchase discounts on acquired loans.
Total interest expense increased $4.7 million, or 35.5% for the six months ended December 31, 2019 compared to the same period last year. The increase was driven by a $5.8 million, or 91.5% increase in deposit interest expense partially offset by a $1.1 million, or 15.7% decrease in interest expense on borrowings. The additional deposit interest expense was a result of a $237.2 million, or 12.5% increase in the average balance of interest-bearing deposits along with a 47 basis point increase in the average cost of those

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deposits for the six months ended December 31, 2019 as compared to the same period last year. Average borrowings for the six months ended December 31, 2019 decreased $15.4 million, or 2.3% along with a 29 basis point decrease in the average cost of borrowings compared to the same period last year. The overall cost of funds increased 26 basis points to 1.30% for the six months ended December 31, 2019 compared to 1.04% in the corresponding period last year.
Noninterest income increased $4.0 million, or 78.4% to $9.1 million for the three months ended December 31, 2019 from $5.1 million for the same period in the previous year primarily due a $2.8 million, or 300.0% increase in the gain on sale of loans held for sale, as well as a $576,000, 195.3% increase in loan income and fees, and a $565,000, or 75.4% increase in other noninterest income. The increase in the gain on sale of loans held for sale was a result of the previously discussed one-to-four family loans sold during the quarter which resulted in a non-recurring $1.3 million gain. In addition, $57.8 million of residential mortgage loans originated for sale were sold with gains of $1.5 million compared to $24.9 million sold and gains of $649,000 in the corresponding quarter in the prior year. During the quarter ended December 31, 2019, $16.5 million of the guaranteed portion of SBA commercial loans were sold with gains of $1.0 million compared to $4.8 million sold and gains of $295,000 in the corresponding quarter in the prior year. The $576,000, 194.8% increase for the quarter in loan income and fees is primarily a result of our adjustable rate conversion program and prepayment fees on equipment finance loans. The $565,000, or 75.5% increase in other noninterest income primarily related to operating lease income from the new equipment finance line of business.
Noninterest income increased $6.0 million, or 56.4% to $16.7 million for the six months ended December 31, 2019 from $10.7 million for the same period in the previous year primarily due to a $3.5 million, or 132.4% increase in the gain on sale of loans held for sale, a $1.1 million, or 181.4% increase in loan income and fees, and a $1.2 million, or 85.9% increase in other noninterest income. In addition to the previously mentioned non-recurring gain on the sale of one-to-four family loans, $103.2 million of residential mortgage loans sold with gains of $2.8 million for the six months ended December 31, 2019, compared to $56.5 million sold and gains of $1.4 million in the corresponding period in the prior year. During the six months ended December 31, 2019, $29.2 million of SBA commercial loans were sold with recorded gains of $2.1 million compared to $17.2 million sold and gains of $1.2 million in the corresponding period in the prior year. The increase in loan income and fees is primarily a result of our adjustable rate conversion program and prepayment fees on equipment finance loans. The increase in other noninterest income primarily related to operating lease income from the equipment finance line of business.
Noninterest expense for the three months ended December 31, 2019 increased $2.2 million, or 10.0% to $24.0 million compared to $21.9 million for the three months ended December 31, 2018. The increase was primarily due to a $1.3 million, or 10.2% increase in salaries and employee benefits as a result of new positions and annual salary increases; an $891,000, or 36.7% increase in other expenses, mainly driven by depreciation from our equipment finance line of business and expenses related to our upcoming core system conversion; a $239,000, or 59.5% increase in marketing and advertising expense, which was used to promote deposit growth and other banking products; a $112,000, or 46.2% increase in real estate owned ("REO") related expenses as a result of higher pre foreclosure expenses during the quarter, and a $90,000, or 4.7% increase in computer services. Partially offsetting these increases was a decrease of $323,000, or 96.4% in deposit insurance premiums as a result of credits issued by the Federal Deposit Insurance Corporation ("FDIC") and a $153,000, or 29.1% decrease in core deposit intangible amortization for the three months ended December 31, 2019 compared to the same period last year.
Noninterest expense for the six months ended December 31, 2019 increased $3.8 million, or 8.8% to $47.6 million compared to $43.7 million for the six months ended December 31, 2018. The increase was primarily due to a $2.5 million, or 9.9% increase in salaries and employee benefits; a $1.4 million, or 27.8% increase in other expenses, mainly driven by depreciation from our equipment finance line of business; a $501,000, or 61.2% increase in marketing and advertising expense; and a $265,000, or 7.1% increase in computer services. Partially offsetting these increases was a decrease of $627,000, or 98.1% in deposit insurance premiums and a $308,000, or 28.2% decrease in core deposit intangible amortization for the six months ended December 31, 2019 compared to the same period last year.
For the three months ended December 31, 2019, the Company's income tax expense increased $189,000, or 8.3% to $2.5 million from $2.3 million for the corresponding quarter in the previous year as a result of higher taxable income. The effective tax rate for the three months ended December 31, 2019 and 2018 was 21.2% and 22.1%, respectively.
For the six months ended December 31, 2019, the Company's income tax expense increased $373,000, or 8.3% to $4.9 million from $4.5 million for the corresponding period in the previous year as a result of higher taxable income. The effective tax rate for the three months ended December 31, 2019 and 2018 was 21.3% and 22.1%, respectively.
Balance Sheet Review
Total assets and liabilities remained relatively level at $3.5 and $3.1 billion, respectively, at December 31, 2019 compared to June 30, 2019. The funds received from the $154.9 million in one-to-four family loans sold and deposit growth of $230.5 million, or 9.9% were used to pay down $245.0 million, or 36.0% of borrowings, fund the $41.6 million, or 7.8% net increase in cash and cash equivalents, commercial paper, certificates of deposits in other banks, securities available for sale, and other investments at

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cost for the first six months of fiscal 2020. Loans held for sale include approximately $85.6 million in one-to-four family loans being marketed for sale. The Company is selling these lower rate one-to-four family loans to decrease its loan to deposit ratio while increasing its net interest margin over time. Excluding these one-to-four family loans, loans held for sale increased $14.3 million primarily from $17.3 million of home equity loans originated for sale during the period. Deferred income taxes decreased $4.5 million, or 16.8% to $22.1 million at December 31, 2019 from $26.5 million at June 30, 2019 due to the use of net operating loss carryforwards.
As of July 1, 2019, the Company adopted the new lease accounting standard, which drove several changes on the balance sheet. Land totaling $2.1 million related to the Company's one finance lease (f/k/a capital lease) was reclassed from premises and equipment, net to other assets as a right of use ("ROU") asset and the corresponding liability was reclassed from a separate line on the balance sheet to other liabilities as a lease liability. As of December 31, 2019, the Company has $4.8 million in ROU assets and corresponding lease liabilities, which are maintained in other assets and other liabilities, respectively.
Stockholders' equity at December 31, 2019 increased $8.1 million, or 2.0% to $417.0 million compared to $408.9 million at June 30, 2019. Changes within stockholders' equity included $18.0 million in net income and $1.6 million in stock-based compensation, partially offset by 396,421 shares of common stock repurchased at an average cost of $25.78, or approximately $10.2 million in total, and $2.2 million related to cash dividends declared. As of December 31, 2019, HomeTrust Bank and the Company were considered "well capitalized" in accordance with their regulatory capital guidelines and exceeded all regulatory capital requirements.
Asset Quality
The allowance for loan losses was $22.0 million, or 0.86% of total loans, at December 31, 2019 compared to $21.4 million, or 0.79% of total loans, at June 30, 2019. The allowance for loan losses to total gross loans excluding acquired loans was 0.92% at December 31, 2019, compared to 0.85% at June 30, 2019. The increase in the ratio of allowance for loan losses to gross loans was driven by approximately $154.9 million of one-to-four family loans being sold, $85.6 million one-to-four loans being transferred to loans held for sale from total loans, and a $602,000 increase in the allowance for loan losses from a $400,000 provision for loan losses and $202,000 in net loan recoveries. The increase in the allowance was mainly driven by one large commercial real estate loan relationship that was moved to nonaccrual during the quarter which resulted in approximately $1.1 million combination of charge-offs and impairments.
There was a $400,000 provision for loan losses for the six months ended December 31, 2019, compared to no provision for the corresponding period in fiscal year 2019. Net loan recoveries totaled $202,000 for the six months ended December 31, 2019, compared to $359,000 for the same period in fiscal year 2019. Net recoveries as a percentage of average loans were (0.01)% and (0.03)% for the six months ended December 31, 2019 and 2018, respectively.
Nonperforming assets increased by $2.4 million, or 18.5% to $15.7 million, or 0.45% of total assets, at December 31, 2019 compared to $13.3 million, or 0.40% of total assets at June 30, 2019. Nonperforming assets included $14.3 million in nonaccruing loans and $1.5 million in REO at December 31, 2019, compared to $10.4 million and $2.9 million, in nonaccruing loans and REO, respectively, at June 30, 2019. The increase in nonaccruing loans primarily relates to the previously discussed commercial real estate loan relationship that was moved to nonaccrual during the quarter. Included in nonperforming loans are $7.3 million of loans restructured from their original terms of which $5.8 million were current at December 31, 2019, with respect to their modified payment terms. Purchased impaired loans aggregating $1.2 million obtained through prior acquisitions are excluded from nonaccruing loans due to the accretion of discounts established in accordance with the acquisition method of accounting for business combinations. Nonperforming loans to total loans was 0.56% at December 31, 2019 and 0.38% at June 30, 2019.
The ratio of classified assets to total assets increased to 0.90% at December 31, 2019 from 0.89% at June 30, 2019. Classified assets increased to $31.4 million at December 31, 2019 compared to $30.9 million at June 30, 2019. Our overall asset quality metrics continue to demonstrate our commitment to growing and maintaining a loan portfolio with a moderate risk profile.

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About HomeTrust Bancshares, Inc.
HomeTrust Bancshares, Inc. is the holding company for HomeTrust Bank. As of December 31, 2019, the Company had assets of $3.5 billion. The Bank, founded in 1926, is a North Carolina state chartered, community-focused financial institution committed to providing value added relationship banking with over 40 locations as well as online/mobile channels. Locations include: North Carolina (including the Asheville metropolitan area, the "Piedmont" region, Charlotte, and Raleigh/Cary), Upstate South Carolina (Greenville), East Tennessee (including Kingsport/Johnson City/Bristol, Knoxville, and Morristown) and Southwest Virginia (including the Roanoke Valley). The Bank is the 2nd largest community bank headquartered in North Carolina.
Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements often include words such as "believe," "expect," "anticipate," "estimate," and "intend" or future or conditional verbs such as "will," "would," "should," "could," or "may." Forward-looking statements are not historical facts but instead represent management's current expectations and forecasts regarding future events, many of which are inherently uncertain and outside of our control. Actual results may differ, possibly materially, from those currently expected or projected in these forward-looking statements. Factors that could cause our actual results to differ materially from those described in the forward-looking statements, include increased competitive pressures; changes in the interest rate environment; changes in general economic conditions and conditions within the securities markets; legislative and regulatory changes; and other factors described in HomeTrust's latest annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other documents filed with or furnished to the Securities and Exchange Commission - which are available on our website at www.htb.com and on the SEC's website at www.sec.gov. Any of the forward-looking statements that we make in this press release or the documents we file with or furnish to the SEC are based upon management's beliefs and assumptions at the time they are made and may turn out to be wrong because of inaccurate assumptions we might make, because of the factors described above or because of other factors that we cannot foresee. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for fiscal 2020 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of, us and could negatively affect our operating and stock performance.



WEBSITE: WWW.HOMETRUSTBANCSHARES.COM
Contact:
Dana L. Stonestreet – Chairman, President and Chief Executive Officer
Tony J. VunCannon – Executive Vice President, Chief Financial Officer, Corporate Secretary and Treasurer
828-259-3939

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Consolidated Balance Sheets (Unaudited)
(Dollars in thousands)
December 31, 2019
 
September 30, 2019
 
June 30, 2019(1)
 
March 31, 2019
 
December 31, 2018
Assets
 
 
 
 
 
 
 
 
 
Cash
$
47,213

 
$
52,082

 
$
40,909

 
$
40,633

 
$
44,425

Interest-bearing deposits
41,705

 
65,011

 
30,134

 
37,678

 
26,881

Cash and cash equivalents
88,918

 
117,093

 
71,043

 
78,311

 
71,306

Commercial paper
253,794

 
254,302

 
241,446

 
246,903

 
239,286

Certificates of deposit in other banks
47,628

 
50,117

 
52,005

 
56,209

 
51,936

Securities available for sale, at fair value
146,022

 
165,714

 
121,786

 
139,112

 
149,752

Other investments, at cost
36,898

 
45,900

 
45,378

 
51,122

 
44,858

Loans held for sale
118,055

 
289,319

 
18,175

 
14,745

 
13,095

Total loans, net of deferred loan fees
2,554,541

 
2,508,730

 
2,705,190

 
2,660,647

 
2,632,231

Allowance for loan losses
(22,031
)
 
(21,314
)
 
(21,429
)
 
(24,416
)
 
(21,419
)
Net loans
2,532,510

 
2,487,416

 
2,683,761

 
2,636,231

 
2,610,812

Premises and equipment, net
58,020

 
58,509

 
61,051

 
60,559

 
66,610

Accrued interest receivable
9,714

 
10,434

 
10,533

 
10,885

 
10,372

Real estate owned ("REO")
1,451

 
2,582

 
2,929

 
3,003

 
2,955

Deferred income taxes
22,066

 
24,257

 
26,523

 
28,832

 
28,533

Bank owned life insurance ("BOLI")
91,048

 
90,499

 
90,254

 
89,663

 
89,156

Goodwill
25,638

 
25,638

 
25,638

 
25,638

 
25,638

Core deposit intangibles
1,715

 
2,088

 
2,499

 
2,948

 
3,436

Other assets
36,755

 
31,441

 
23,157

 
13,576

 
5,354

Total Assets
$
3,470,232

 
$
3,655,309

 
$
3,476,178

 
$
3,457,737

 
$
3,413,099

Liabilities and Stockholders' Equity
 

 
 

 
 

 
 

 
 

Liabilities
 

 
 

 
 

 
 

 
 

Deposits
$
2,557,769

 
$
2,494,194

 
$
2,327,257

 
$
2,308,395

 
$
2,258,069

Borrowings
435,000

 
685,000

 
680,000

 
680,000

 
688,000

Other liabilities
60,468

 
63,047

 
60,025

 
62,112

 
56,060

Total liabilities
3,053,237

 
3,242,241

 
3,067,282

 
3,050,507

 
3,002,129

Stockholders' Equity
 

 
 

 
 

 
 

 
 

Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued or outstanding

 

 

 

 

Common stock, $0.01 par value, 60,000,000 shares authorized (2)
177

 
178

 
180

 
183

 
185

Additional paid in capital
182,366

 
186,359

 
190,315

 
196,824

 
203,660

Retained earnings
240,312

 
232,315

 
224,545

 
217,490

 
215,289

Unearned Employee Stock Ownership Plan ("ESOP") shares
(6,612
)
 
(6,744
)
 
(6,877
)
 
(7,009
)
 
(7,142
)
Accumulated other comprehensive income (loss)
752

 
960

 
733

 
(258
)
 
(1,022
)
Total stockholders' equity
416,995

 
413,068

 
408,896

 
407,230

 
410,970

Total Liabilities and Stockholders' Equity
$
3,470,232

 
$
3,655,309

 
$
3,476,178

 
$
3,457,737

 
$
3,413,099

_________________________________
(1)
Derived from audited financial statements.
(2)
Shares of common stock issued and outstanding were 17,664,384 at December 31, 2019; 17,818,145 at September 30, 2019; 17,984,105 at June 30, 2019; 18,265,535 at March 31, 2019; and 18,520,825 at December 31, 2018.
 

6



Consolidated Statement of Income (Unaudited)
 
Three Months Ended
 
Six Months Ended
 
December 31,
 
September 30,
 
December 31,
 
December 31,
 
December 31,
(Dollars in thousands)
2019
 
2019
 
2018
 
2019
 
2018
Interest and Dividend Income
 
 
 
 
 
 
 
 
 
Loans
$
32,119

 
$
32,266

 
$
30,544

 
$
64,385

 
$
59,272

Commercial paper and interest-bearing deposits
1,912

 
2,253

 
1,966

 
4,165

 
3,823

Securities available for sale
1,093

 
896

 
876

 
1,989

 
1,732

Other investments
772

 
832

 
1,014

 
1,604

 
1,853

Total interest and dividend income
35,896

 
36,247

 
34,400

 
72,143

 
66,680

Interest Expense
 
 
 

 
 
 
 

 
 

Deposits
6,321

 
5,853

 
3,607

 
12,174

 
6,357

Borrowings
2,541

 
3,321

 
3,692

 
5,862

 
6,950

Total interest expense
8,862

 
9,174

 
7,299

 
18,036

 
13,307

Net Interest Income
27,034

 
27,073

 
27,101

 
54,107

 
53,373

Provision for Loan Losses
400

 

 

 
400

 

Net Interest Income after Provision for Loan Losses
26,634

 
27,073

 
27,101

 
53,707

 
53,373

Noninterest Income
 
 
 

 
 
 
 

 
 

Service charges and fees on deposit accounts
2,605

 
2,443

 
2,577

 
5,048

 
4,978

Loan income and fees
871

 
882

 
295

 
1,753

 
623

Gain on sale of loans held for sale
3,775

 
2,299

 
944

 
6,074

 
2,614

BOLI income
509

 
697

 
520

 
1,206

 
1,056

Other, net
1,314

 
1,339

 
749

 
2,653

 
1,427

Total noninterest income
9,074

 
7,660

 
5,085

 
16,734

 
10,698

Noninterest Expense
 
 
 

 
 
 
 

 
 

Salaries and employee benefits
14,170

 
13,912

 
12,857

 
28,082

 
25,542

Net occupancy expense
2,384

 
2,342

 
2,425

 
4,726

 
4,751

Computer services
1,985

 
2,024

 
1,895

 
4,009

 
3,744

Telephone, postage, and supplies
798

 
802

 
743

 
1,600

 
1,512

Marketing and advertising
641

 
679

 
402

 
1,320

 
819

Deposit insurance premiums
12

 

 
335

 
12

 
639

Loss (gain) on sale and impairment of REO
122

 
(19
)
 
75

 
103

 
254

REO expense
238

 
258

 
173

 
496

 
348

Core deposit intangible amortization
373

 
411

 
526

 
784

 
1,092

Other
3,318

 
3,124

 
2,427

 
6,442

 
5,040

Total noninterest expense
24,041

 
23,533

 
21,858

 
47,574

 
43,741

Income Before Income Taxes
11,667

 
11,200

 
10,328

 
22,867

 
20,330

Income Tax Expense
2,476

 
2,396

 
2,287

 
4,872

 
4,499

Net Income
$
9,191

 
$
8,804

 
$
8,041

 
$
17,995

 
$
15,831

 
 
 
 
 


7



Per Share Data
 
 
Three Months Ended
 
Six months ended
 
 
December 31,
 
September 30,
 
December 31,
 
December 31,
 
December 31,
 
 
2019
 
2019
 
2018
 
2019
 
2018
Net income per common share:(1)
 
 
 
 
 
 
 
 
 
 
Basic
 
$
0.54

 
$
0.51

 
$
0.45

 
$
1.05

 
$
0.88

Diluted
 
$
0.52

 
$
0.49

 
$
0.43

 
$
1.01

 
$
0.84

Average shares outstanding:
 
 
 
 
 
 
 
 
 
 
Basic
 
16,906,457

 
17,097,647

 
17,797,553

 
17,002,052

 
17,961,465

Diluted
 
17,567,680

 
17,753,657

 
18,497,334

 
17,660,687

 
18,689,584

Book value per share at end of period
 
$
23.61

 
$
23.18

 
$
22.19

 
$
23.61

 
$
22.19

Tangible book value per share at end of period (2)
 
$
22.08

 
$
21.65

 
$
20.66

 
$
22.08

 
$
20.66

Cash dividends declared per common share
 
$
0.07

 
$
0.06

 
$
0.06

 
$
0.13

 
$
0.06

Total shares outstanding at end of period
 
17,664,384

 
17,818,145

 
18,520,825

 
17,664,384

 
18,520,825

__________________________________________________
(1)
Basic and diluted net income per common share have been prepared in accordance with the two-class method.
(2)
See Non-GAAP reconciliation tables below for adjustments.
Selected Financial Ratios and Other Data
 
 
Three Months Ended
 
Six Months Ended
 
 
December 31,
 
September 30,
 
December 31,
 
December 31,
 
December 31,
 
 
2019
 
2019
 
2018
 
2019
 
2018
Performance ratios: (1)
 
 
 
 
 
 
Return on assets (ratio of net income to average total assets)
 
1.02
%
 
0.99
%
 
0.95
%
 
1.00
%
 
0.95
%
Return on equity (ratio of net income to average equity)
 
8.87

 
8.57

 
7.83

 
8.72

 
7.69

Tax equivalent yield on earning assets(2)
 
4.34

 
4.43

 
4.45

 
4.38

 
4.34

Rate paid on interest-bearing liabilities
 
1.27

 
1.33

 
1.13

 
1.30

 
1.04

Tax equivalent average interest rate spread (2)
 
3.07

 
3.10

 
3.32

 
3.08

 
3.30

Tax equivalent net interest margin(2) (3)
 
3.27

 
3.32

 
3.51

 
3.30

 
3.48

Average interest-earning assets to average interest-bearing liabilities
 
119.53

 
119.41

 
120.48

 
119.47

 
121.22

Operating expense to average total assets
 
2.66

 
2.64

 
2.59

 
2.65

 
2.61

Efficiency ratio
 
66.58

 
67.75

 
67.91

 
67.16

 
68.27

Efficiency ratio - adjusted (4)
 
66.05

 
67.20

 
67.32

 
66.62

 
67.67

_____________________________
(1)
Ratios are annualized where appropriate.
(2)
The weighted average rate for municipal leases is adjusted for a 24% combined federal and state tax rate, respectively since the interest from these leases is tax exempt.
(3)
Net interest income divided by average interest-earning assets.
(4)
See Non-GAAP reconciliation tables below for adjustments.

8



 
At or For the Three Months Ended
 
December 31,
 
September 30,
 
June 30,
 
March 31,
 
December 31,
 
2019
 
2019
 
2019
 
2019
 
2018
Asset quality ratios:
 
 
 
 
 
 
 
 
 
Nonperforming assets to total assets(1)
0.45
 %
 
0.37
%
 
0.38
%
 
0.41
%
 
0.37
 %
Nonperforming loans to total loans(1)
0.56

 
0.43

 
0.38

 
0.43

 
0.37

Total classified assets to total assets
0.90

 
0.84

 
0.89

 
1.00

 
0.97

Allowance for loan losses to nonperforming loans(1)
154.48

 
195.88

 
206.90

 
215.46

 
221.45

Allowance for loan losses to total loans
0.86

 
0.85

 
0.79

 
0.92

 
0.81

Allowance for loan losses to total gross loans excluding acquired loans(2)
0.92

 
0.92

 
0.85

 
0.99

 
0.89

Net charge-offs (recoveries) to average loans (annualized)
(0.05
)
 
0.02

 
0.47

 
0.38

 
(0.07
)
Capital ratios:
 
 
 
 
 
 
 
 
 
Equity to total assets at end of period
12.02
 %
 
11.30
%
 
11.76
%
 
11.78
%
 
12.04
 %
Tangible equity to total tangible assets(2)
11.33

 
10.63

 
11.06

 
11.06

 
11.31

Average equity to average assets
11.52

 
11.54

 
11.72

 
11.93

 
12.20

__________________________________________

(1)
Nonperforming assets include nonaccruing loans, consisting of certain restructured loans, and REO. There were no accruing loans more than 90 days past due at the dates indicated. At December 31, 2019, there were $7.3 million of restructured loans included in nonaccruing loans and $7.6 million, or 53.0% of nonaccruing loans were current on their loan payments. Purchased impaired loans acquired through bank acquisitions are excluded from nonaccruing loans due to the accretion of discounts in accordance with the acquisition method of accounting for business combinations.
(2)
See Non-GAAP reconciliation tables below for adjustments.


9



Average Balance Sheet Data
 
For the Three Months Ended December 31,
 
2019
 
2018
 
Average
Balance
Outstanding
 
Interest
Earned/
Paid
(2)
 
Yield/
Rate
(2)
 
Average
Balance
Outstanding
 
Interest
Earned/
Paid
(2)
 
Yield/
Rate
(2)
(Dollars in thousands)
 
Assets:
 
 
 
 
 
 
 
 
 
 
 
Interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
Loans receivable(1)
$
2,782,412

 
$
32,409

 
4.66
%
 
$
2,610,117

 
$
30,826

 
4.72
%
Commercial paper and deposits in other banks
346,376

 
1,912

 
2.21
%
 
313,158

 
1,965

 
2.51
%
Securities available for sale
165,577

 
1,093

 
2.64
%
 
151,788

 
876

 
2.31
%
Other interest-earning assets(3)
44,398

 
772

 
6.95
%
 
44,147

 
1,015

 
9.20
%
Total interest-earning assets
3,338,763

 
36,186

 
4.34
%
 
3,119,210

 
34,682

 
4.45
%
Other assets
269,679

 
 
 
 
 
250,516

 
 
 
 
Total assets
$
3,608,442

 
 
 
 
 
$
3,369,726

 
 
 
 
Liabilities and equity:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposits:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing checking accounts
455,747

 
375

 
0.33
%
 
465,418

 
302

 
0.26
%
Money market accounts
785,374

 
2,083

 
1.06
%
 
689,335

 
1,265

 
0.73
%
Savings accounts
168,022

 
50

 
0.12
%
 
196,434

 
63

 
0.13
%
Certificate accounts
778,664

 
3,813

 
1.96
%
 
564,112

 
1,977

 
1.40
%
Total interest-bearing deposits
2,187,807

 
6,321

 
1.16
%
 
1,915,299

 
3,607

 
0.75
%
Borrowings
605,489

 
2,541

 
1.68
%
 
673,783

 
3,692

 
2.19
%
  Total interest-bearing liabilities
2,793,296

 
8,862

 
1.27
%
 
2,589,082

 
7,299

 
1.13
%
Noninterest-bearing deposits
334,732

 
 
 
 
 
309,012

 
 
 
 
Other liabilities
65,812

 
 
 
 
 
60,689

 
 
 
 
Total liabilities
3,193,840

 
 
 
 
 
2,958,783

 
 
 
 
Stockholders' equity
414,602

 
 
 
 
 
410,943

 
 
 
 
Total liabilities and stockholders' equity
$
3,608,442

 
 
 
 
 
$
3,369,726

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net earning assets
$
545,467

 
 

 
 
 
$
530,128

 
 
 
 
Average interest-earning assets to
 
 
 
 
 
 
 
 
 
 
 
average interest-bearing liabilities
119.53
%
 
 
 
 
 
120.48
%
 
 
 
 
Tax-equivalent:
 
 
 
 
 
 
 
 
 
 
 
Net interest income
 
 
$
27,324

 
 
 
 
 
$
27,383

 
 
Interest rate spread
 
 
 
 
3.07
%
 
 
 
 
 
3.32
%
Net interest margin(4)
 
 
 
 
3.27
%
 
 
 
 
 
3.51
%
Non-tax-equivalent:
 
 
 
 
 
 
 
 
 
 
 
Net interest income
 
 
$
27,034

 
 
 
 
 
$
27,101

 
 
Interest rate spread
 
 
 
 
3.03
%
 
 
 
 
 
3.28
%
Net interest margin(4)
 
 
 
 
3.24
%
 
 
 
 
 
3.48
%
__________________
(1) The average loans receivable, net balances include loans held for sale and nonaccruing loans.
(2) Interest income used in the average interest earned and yield calculation includes the tax equivalent adjustment of $290 and $282 for the three months ended December 31, 2019 and 2018, respectively, calculated based on a combined federal and state tax rate of 24%.
(3) The average other interest-earning assets consists of FRB stock, FHLB stock, and SBIC investments.
(4) Net interest income divided by average interest-earning assets.


10



 
For the Six Months Ended December 31,
 
2019
 
2018
 
Average
Balance
Outstanding
 
Interest
Earned/
Paid(2)
 
Yield/
Rate(2)
 
Average
Balance
Outstanding
 
Interest
Earned/
Paid(2)
 
Yield/
Rate(2)
(Dollars in thousands)
 
Assets:
 
 
 
 
 
 
 
 
 
 
 
Interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
Loans receivable(1)
$
2,766,022

 
$
64,960

 
4.70
%
 
$
2,584,145

 
$
59,837

 
4.63
%
Commercial paper and deposits in other banks
354,750

 
4,165

 
2.35
%
 
317,219

 
3,823

 
2.41
%
Securities available for sale
152,143

 
1,989

 
2.61
%
 
153,019

 
1,732

 
2.26
%
Other interest-earning assets(3)
45,054

 
1,604

 
7.12
%
 
43,302

 
1,853

 
8.56
%
Total interest-earning assets
3,317,969

 
72,718

 
4.38
%
 
3,097,685

 
67,245

 
4.34
%
Other assets
267,028

 
 
 
 
 
248,084

 
 
 
 
Total assets
$
3,584,997

 
 
 
 
 
$
3,345,769

 
 
 
 
Liabilities and equity:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing checking accounts
448,636

 
694

 
0.31
%
 
462,657

 
571

 
0.25
%
Money market accounts
752,178

 
3,844

 
1.02
%
 
683,332

 
2,222

 
0.65
%
Savings accounts
170,207

 
103

 
0.12
%
 
202,362

 
131

 
0.13
%
Certificate accounts
761,810

 
7,533

 
1.98
%
 
547,310

 
3,433

 
1.25
%
Total interest-bearing deposits
2,132,831

 
12,174

 
1.14
%
 
1,895,661

 
6,357

 
0.67
%
Borrowings
644,451

 
5,862

 
1.82
%
 
659,821

 
6,950

 
2.11
%
  Total interest-bearing liabilities
2,777,282

 
18,036

 
1.30
%
 
2,555,482

 
13,307

 
1.04
%
Noninterest-bearing deposits
330,418

 
 
 
 
 
316,397

 
 
 
 
Other liabilities
64,456

 
 
 
 
 
61,985

 
 
 
 
Total liabilities
3,172,156

 
 
 
 
 
2,933,864

 
 
 
 
Stockholders' equity
412,841

 
 
 
 
 
411,905

 
 
 
 
Total liabilities and stockholders' equity
$
3,584,997

 
 
 
 
 
$
3,345,769

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net earning assets
$
540,687

 
 
 
 
 
$
542,203

 
 
 
 
Average interest-earning assets to
 
 
 
 
 
 
 
 
 
 
 
average interest-bearing liabilities
119.47
%
 
 
 
 
 
121.22
%
 
 
 
 
Tax-equivalent:
 
 
 
 
 
 
 
 
 
 
 
Net interest income
 
 
$
54,682

 
 
 
 
 
$
53,938

 
 
Interest rate spread
 
 
 
 
3.08
%
 
 
 
 
 
3.30
%
Net interest margin(4)
 
 
 
 
3.30
%
 
 
 
 
 
3.48
%
Non-tax-equivalent:
 
 
 
 
 
 
 
 
 
 
 
Net interest income
 
 
$
54,108

 
 
 
 
 
$
53,373

 
 
Interest rate spread
 
 
 

 
3.05
%
 
 
 
 
 
3.26
%
Net interest margin(4)
 
 
 
 
3.26
%
 
 
 
 
 
3.45
%
__________________
(1) The average loans receivable, net balances include loans held for sale and nonaccruing loans.
(2) Interest income used in the average interest earned and yield calculation includes the tax equivalent adjustment of $574 and $565 for the six months ended December 31, 2019 and 2018, respectively, calculated based on a combined federal and state tax rate of 24%.
(3) The average other interest-earning assets consists of FRB stock, FHLB stock, and SBIC investments.
(4) Net interest income divided by average interest-earning assets.


11



Loans
(Dollars in thousands)
December 31, 2019
 
September 30, 2019
 
June 30, 2019
 
March 31, 2019
 
December 31, 2018
Retail consumer loans:
 
 
 
 
 
 
 
 
 
     One-to-four family
$
417,255

 
$
396,649

 
$
660,591

 
$
658,723

 
$
661,374

     HELOCs - originated
142,989

 
141,129

 
139.435

 
133,203

 
135,430

     HELOCs - purchased
92,423

 
104,324

 
116,972

 
128,832

 
138,571

     Construction and land/lots
71,901

 
85,319

 
80,602

 
76,153

 
74,507

     Indirect auto finance
142,533

 
147,808

 
153,448

 
162,127

 
170,516

     Consumer
11,102

 
11,400

 
11.416

 
19,374

 
13,520

Total retail consumer loans
878,203

 
886,629

 
1,162,464

 
1,178,412

 
1,193,918

Commercial loans:
 
 
 
 
 
 
 
 
 
     Commercial real estate
998,019

 
990,787

 
927,261

 
892,383

 
904,357

     Construction and development
223,839

 
203,494

 
210,916

 
214,511

 
198,738

     Commercial and industrial
152,727

 
158,706

 
160,471

 
154,471

 
143,201

     Equipment finance
185,427

 
154,479

 
132,058

 
109.175

 
81,380

     Municipal leases
115,240

 
114,382

 
112,016

 
112,067

 
111,135

Total commercial loans
1,675,252

 
1,621,848

 
1,542,722

 
1,482,607

 
1,438,812

Total loans
2,553,455

 
2,508,477

 
2,705,186

 
2,661,019

 
2,632,730

     Deferred loan costs (fees), net
1,086

 
253

 
4

 
(372
)
 
(499
)
Total loans, net of deferred loan fees
2,554,541

 
2,508,730

 
2,705,190

 
2,660,647

 
2,632,231

     Allowance for loan losses
(22,031
)
 
(21,314
)
 
(21,429
)
 
(24,416
)
 
(21,419
)
Loans, net
$
2,532,510

 
$
2,487,416

 
$
2,683,761

 
$
2,636,231

 
$
2,610,812

Deposits
(Dollars in thousands)
December 31, 2019
 
September 30, 2019
 
June 30, 2019
 
March 31, 2019
 
December 31, 2018
Core deposits:
 
 
 
 
 
 
 
 
 
    Noninterest-bearing accounts
$
327,320

 
$
327,371

 
$
294,322

 
$
301,083

 
$
300,031

    NOW accounts
457,428

 
449,623

 
452,295

 
477,637

 
474,080

    Money market accounts
815,949

 
769,000

 
691,172

 
692,102

 
703,445

    Savings accounts
167,520

 
169,872

 
177,278

 
192,754

 
192,954

Total core deposits
1,768,217

 
1,715,866

 
1,615,067

 
1,663,576

 
1,670,510

Certificates of deposit
789,552

 
778,328

 
712,190

 
644,819

 
587,559

Total deposits
$
2,557,769

 
$
2,494,194

 
$
2,327,257

 
$
2,308,395

 
$
2,258,069


12



Non-GAAP Reconciliations
In addition to results presented in accordance with generally accepted accounting principles utilized in the United States ("GAAP"), this earnings release contains certain non-GAAP financial measures, which include: the efficiency ratio; tangible book value; tangible book value per share; tangible equity to tangible assets ratio; and the ratio of the allowance for loan losses to total loans excluding acquired loans. The Company believes these non-GAAP financial measures and ratios as presented are useful for both investors and management to understand the effects of certain items and provides an alternative view of the Company's performance over time and in comparison to the Company's competitors. These non-GAAP measures have inherent limitations, are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for total stockholders' equity or operating results determined in accordance with GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies. 

Set forth below is a reconciliation to GAAP of our efficiency ratio:
 
 
Three Months Ended
 
Six Months Ended
(Dollars in thousands)
 
December 31,
 
September 30,
 
December 31,
 
December 31,
 
December 31,
 
 
2019
 
2019
 
2018
 
2019
 
2018
Noninterest expense
 
$
24,041

 
$
23,533

 
$
21,858

 
$
47,574

 
$
43,741

 
 
 
 
 
 
 
 
 
 
 
Net interest income
 
$
27,034

 
$
27,073

 
$
27,101

 
$
54,107

 
$
53,373

Plus noninterest income
 
9,074

 
7,660

 
5,085

 
16,734

 
10,698

Plus tax equivalent adjustment
 
290

 
285

 
282

 
574

 
565

Net interest income plus noninterest income – as adjusted
 
$
36,398

 
$
35,018

 
$
32,468

 
$
71,415

 
$
64,636

Efficiency ratio - adjusted
 
66.05
%
 
67.20
%
 
67.32
%
 
66.62
%
 
67.67
%
Efficiency ratio
 
66.58
%
 
67.75
%
 
67.91
%
 
67.16
%
 
68.27
%

Set forth below is a reconciliation to GAAP of tangible book value and tangible book value per share:
 
 
As of
(Dollars in thousands, except per share data)
 
December 31,
 
September 30,
 
June 30,
 
March 31,
 
December 31,
 
 
2019
 
2019
 
2019
 
2019
 
2018
Total stockholders' equity
 
$
416,995

 
$
413,068

 
$
408,896

 
$
407,230

 
$
410,970

Less: goodwill, core deposit intangibles, net of taxes
 
26,959

 
27,246

 
27,562

 
27,908

 
28,284

Tangible book value (1)
 
$
390,036

 
$
385,822

 
$
381,334

 
$
379,322

 
$
382,686

Common shares outstanding
 
17,664,384

 
17,818,145

 
17,984,105

 
18,265,535

 
18,520,825

Tangible book value per share
 
$
22.08

 
$
21.65

 
$
21.20

 
$
20.77

 
$
20.66

Book value per share
 
$
23.61

 
$
23.18

 
$
22.74

 
$
22.29

 
$
22.19

(1)    Tangible book value is equal to total stockholders' equity less goodwill and core deposit intangibles, net of related deferred tax liabilities.

Set forth below is a reconciliation to GAAP of tangible equity to tangible assets:
 
 
As of
 
 
December 31,
 
September 30,
 
June 30,
 
March 31,
 
December 31,
 
 
2019
 
2019
 
2019
 
2019
 
2018
 
 
(Dollars in thousands)
Tangible equity(1)
 
$
390,036

 
$
385,822

 
$
381,334

 
$
379,322

 
$
382,686

Total assets
 
3,470,232

 
3,655,309

 
3,476,178

 
3,457,737

 
3,413,099

Less: goodwill, core deposit intangibles, net of taxes
 
26,959

 
27,246

 
27,562

 
27,908

 
28,284

Total tangible assets(2)
 
$
3,443,273

 
$
3,628,063

 
$
3,448,616

 
$
3,429,829

 
$
3,384,815

Tangible equity to tangible assets
 
11.33
%
 
10.63
%
 
11.06
%
 
11.06
%
 
11.31
%
(1)    Tangible equity (or tangible book value) is equal to total stockholders' equity less goodwill and core deposit intangibles, net of related deferred tax liabilities.
(2)    Total tangible assets is equal to total assets less goodwill and core deposit intangibles, net of related deferred tax liabilities.

 
 
 
 
 
 
 
 
 
 
 

13



Set forth below is a reconciliation to GAAP of the allowance for loan losses to total loans (excluding net deferred loan fees) and the allowance for loan losses as adjusted to exclude acquired loans:
 
 
As of
(Dollars in thousands)
 
December 31,
 
September 30,
 
June 30,
 
March 31,
 
December 31,
 
 
2019
 
2019
 
2019
 
2019
 
2018
Total gross loans receivable (GAAP)
 
$
2,553,455

 
$
2,508,477

 
$
2,705,186

 
$
2,661,019

 
$
2,632,730

Less: acquired loans
 
186,970

 
206,937

 
214,046

 
223,101

 
236,389

Adjusted loans (non-GAAP)
 
$
2,366,485

 
$
2,301,540

 
$
2,491,140

 
$
2,437,918

 
$
2,396,341

 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses (GAAP)
 
$
22,031

 
$
21,314

 
$
21,429

 
$
24,416

 
$
21,419

Less: allowance for loan losses on acquired loans
 
152

 
194

 
201

 
201

 
199

Adjusted allowance for loan losses
 
$
21,879

 
$
21,120

 
$
21,228

 
$
24,215

 
$
21,220

Adjusted allowance for loan losses / Adjusted loans (non-GAAP)
 
0.92
%
 
0.92
%
 
0.85
%
 
0.99
%
 
0.89
%

14
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