Investor Relations

Press Release

ServisFirst Bancshares, Inc. Announces Results for First Quarter 2017

Company Release - 4/17/2017 4:01 PM ET

BIRMINGHAM, Ala., April 17, 2017 (GLOBE NEWSWIRE) -- ServisFirst Bancshares, Inc. (NASDAQ:SFBS), today announced earnings and operating results for the quarter ended March 31, 2017.

FIRST QUARTER HIGHLIGHTS:

  • Loans increased 20% for the first quarter on an annualized basis
  • Loans and deposits increased 19% and 24%, respectively, year over year
  • Diluted EPS increased 11% from $0.38 to $0.42 year over year
  • Quarterly dividend increased 25% as previously announced
  • Tampa Bay Main office opened in March 2017, replacing the Pascoe County loan production office

Tom Broughton, President and CEO, said, “We are pleased with our loan growth in the first quarter which is typically the slowest growth quarter of the year.  Business activity around our Southeastern footprint has greatly improved in 2017 to date.”  Bud Foshee, CFO, stated, “Our efficiency ratio has improved from 40.5% to 37.6% year over year.”

FINANCIAL SUMMARY (UNAUDITED)
 
(in Thousands except share and per share amounts)
 
                      
On December 20, 2016, the Company effected a two-for-one split of its common stock in the form of a stock dividend.  All share and per share
information for prior periods in this release has been adjusted to give effect to this stock split.
 
                      
    Period Ending
March 31, 2017
 Period Ending
December 31, 2016
 % Change
From Period
Ending
December 31,
2016 to
Period Ending
March 31,
2017
 Period Ending
March 31, 2016
 % Change
From Period
Ending March
31, 2016 to
Period Ending
March 31,
2017
 
QUARTERLY OPERATING RESULTS                   
Net Income $22,519  $21,738  4 % $19,956  13% 
Net Income Available to Common Stockholders $22,519  $21,714  4 % $19,956  13% 
Diluted Earnings Per Share $0.42  $0.40  5 % $0.38  11% 
Return on Average Assets  1.45%  1.39%     1.53%    
Return on Average Common Stockholders' Equity  17.09%  16.71%     17.39%    
Average Diluted Shares Outstanding  54,133,722   53,961,160      53,133,620     
                      
                      
BALANCE SHEET                   
Total Assets $6,336,165  $6,370,448  (1)% $5,378,599  18% 
Loans  5,151,984   4,911,770  5 %  4,340,900  19% 
Non-interest-bearing Demand Deposits  1,292,440   1,281,605  1 %  1,070,275  21% 
Total Deposits  5,361,532   5,420,311  (1)%  4,339,747  24% 
Stockholders' Equity  545,148   522,889  4 %  470,940  16% 

DETAILED FINANCIALS

ServisFirst Bancshares, Inc. reported net income and net income available to common stockholders of $22.5 million for the quarter ended March 31, 2017, compared to net income and net income available to common stockholders of $20.0 million for the same quarter in 2016.  Basic and diluted earnings per common share were $0.43 and $0.42, respectively, for the first quarter of 2017, compared to $0.38 for both basic and diluted earnings per share for the first quarter of 2016.

Return on average assets was 1.45% and return on average equity was 17.09% for the first quarter of 2017, compared to 1.53% and 17.39%, respectively, for the first quarter of 2016.

Net interest income was $52.1 million for the first quarter of 2017, compared to $49.1 million for the fourth quarter of 2016 and $44.2 million for the first quarter of 2016.  The net interest margin in the first quarter of 2017 was 3.53%, an increase of 23 basis points from the fourth quarter of 2016 and a decrease of four basis points from the first quarter of 2016.  The increase in net interest income on a linked quarter basis is attributable to a $301.3 million increase in average loans outstanding and a $17.5 million increase in average stockholders’ equity, all resulting in a positive mix change in our balance sheet.  A $35.0 million decrease in average non-interest-bearing deposits offset the positive mix change caused by increases in loans and stockholders’ equity, while a $313.2 million decrease in federal funds sold and interest-bearing balances with banks added to the positive mix change.  The average yield on loans increased by six basis points to 4.51% on a linked quarter basis.  This was primarily the result of repricing of loans following the Federal Reserve Bank’s increase of interest rates in December 2016 and again in March 2017.

Average loans for the first quarter of 2017 were $5.00 billion, an increase of $301.3 million, or 6.4%, over average loans of $4.70 billion for the fourth quarter of 2016, and an increase of $763.9 million, or 18.0%, over average loans of $4.24 billion for the first quarter of 2016.

Average total deposits for the first quarter of 2017 were $5.32 billion, an increase of $45.4 million, or 0.9%, over average total deposits of $5.27 billion for the fourth quarter of 2016, and an increase of $1.05 billion, or 24.6%, over average total deposits of $4.27 billion for the first quarter of 2016.

Non-performing assets to total assets were 0.27% for the first quarter of 2017, a decrease of seven basis points compared to 0.34% for the fourth quarter of 2016 and an increase of seven basis points compared to 0.20% for the first quarter of 2016.  Net credit charge-offs to average loans were 0.24%, a 15 basis point increase compared to 0.09% for the fourth quarter of 2016 and a 21 basis point increase compared to 0.03% for the first quarter of 2016.  We recorded a $5.0 million provision for loan losses in the first quarter of 2017 compared to $4.1 million in the fourth quarter of 2016 and $2.1 million in the first quarter of 2016.  The allowance for loan loss as a percentage of total loans was 1.05% at March 31, 2017 compared to 1.06% at December 31, 2016 and 1.04% at March 31, 2016.  In management’s opinion, the allowance is adequate and was determined by consistent application of ServisFirst Bank’s methodology for calculating its allowance for loan losses.

Non-interest income increased $1.1 million during the first quarter of 2017, or 32%, compared to the first quarter of 2016.  Mortgage revenue increased $231,000, or 35%, to $899,000 during the first quarter of 2017, compared to $668,000 during the first quarter of 2016.  Credit card revenue increased $710,000, or 151%, to $1.2 million during the first quarter of 2017, compared to $469,000 during the first quarter of 2016.   

Non-interest expense for the first quarter of 2017 increased $2.0 million, or 10%, to $21.3 million from $19.3 million in the first quarter of 2016, and decreased $770,000, or 3%, on a linked quarter basis.  Salary and benefit expense for the first quarter of 2017 increased $646,000, or 6%, to $11.7 million from $11.1 million in the first quarter of 2016, and increased $516,000, or 5%, on a linked quarter basis.  We added seven production officers and had two terminations during the first quarter of 2017.  Equipment and occupancy expense increased $265,000, or 13%, to $2.3 million in the first quarter of 2017, from $2.0 million in the first quarter of 2016.  This increase in equipment and occupancy expense was attributable to new offices in our Tampa Bay, Florida and Charleston, South Carolina regions, which were relocations from temporary facilities we previously occupied.  Our efficiency ratio for the first quarter of 2017, fourth quarter of 2016 and first quarter of 2016 was 37.58%, 39.96% and 40.51%, respectively.

Income tax expense increased $1.5 million, or 24%, to $7.8 million in the first quarter of 2017, compared to $6.3 million in the first quarter of 2016.  In the second quarter of 2016 we adopted the amendments in Accounting Standards Update 2016-09 using the modified retrospective method.  Accordingly, we recognized excess tax benefits from the exercise and vesting of stock options and restricted stock of $2.1 million in the first quarter of 2017, compared to $2.3 million in the first quarter of 2016.  Our effective tax rate for the first quarter of 2017 and 2016 was 25.8% and 24.0%, respectively.

GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures, including tangible common stockholders’ equity, total tangible assets, tangible book value per share and tangible common equity to total tangible assets, each of which excludes goodwill and core deposit intangibles associated with our acquisition of Metro Bancshares, Inc. in January 2015.  We believe these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that these non-GAAP financial measures have a number of limitations.  As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies, including those in our industry, use.  The following reconciliation table provides a more detailed analysis of the non-GAAP financial measures as of and for the comparative periods presented in this press release.  Dollars are in thousands, except share and per share data.

    At March 31,
2017
 At December 31,
2016
 At September 30,
2016
 At June 30,
2016
 At March 31,
2016
 
Book value per share - GAAP $10.32  $9.93  $9.65  $9.32  $8.99  
Total common stockholders' equity - GAAP  545,148   522,889   507,886   489,097   470,940  
 Adjustments:                     
 Adjusted for goodwill and core deposit intangible asset  14,924   14,996   15,073   15,154   15,239  
Tangible common stockholders' equity - non-GAAP $530,224  $507,893  $492,813  $473,943  $455,701  
Tangible book value per share - non-GAAP $10.04  $9.65  $9.37  $9.03  $8.70  
                        
Stockholders' equity to total assets - GAAP  8.60%  8.21%  8.46%  8.66%  8.76% 
Total assets - GAAP $6,336,165  $6,370,448  $6,002,621  $5,646,055  $5,378,596  
 Adjustments:                     
 Adjusted for goodwill and core deposit intangible asset  14,924   14,996   15,073   15,154   15,239  
Total tangible assets - non-GAAP $6,321,241  $6,355,452  $5,987,548  $5,630,901  $5,363,357  
Tangible common equity to total tangible assets - non-GAAP  8.39%  7.99%  8.23%  8.42%  8.50% 

About ServisFirst Bancshares, Inc.

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

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

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

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

                   
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
 
(In thousands except share and per share data)
 
  1st Quarter 2017 4th Quarter 2016 3rd Quarter 2016 2nd Quarter 2016 1st Quarter 2016 
CONSOLIDATED STATEMENT OF INCOME                     
Interest income $59,517  $56,200  $54,691  $52,050  $49,961  
Interest expense  7,465   7,091   6,773   6,159   5,782  
Net interest income  52,052   49,109   47,918   45,891   44,179  
Provision for loan losses  4,986   4,075   3,464   3,800   2,059  
Net interest income after provision for loan losses  47,066   45,034   44,454   42,091   42,120  
Non-interest income  4,546   6,039   4,791   3,847   3,435  
Non-interest expense  21,267   22,037   20,162   19,504   19,290  
Income before income tax  30,345   29,036   29,083   26,434   26,265  
Provision for income tax  7,826   7,298   8,174   7,558   6,309  
Net income  22,519   21,738   20,909   18,876   19,956  
Preferred stock dividends  -   24   -   23   -  
Net income available to common stockholders $22,519  $21,714  $20,909  $18,853  $19,956  
Earnings per share - basic (1) $0.43  $0.41  $0.40  $0.36  $0.38  
Earnings per share - diluted (1) $0.42  $0.40  $0.39  $0.36  $0.38  
Average diluted shares outstanding (1)  54,133,722   53,961,160   53,879,328   53,452,526   53,133,620  
                      
CONSOLIDATED BALANCE SHEET DATA                     
Total assets $6,336,165  $6,370,448  $6,002,621  $5,646,055  $5,378,599  
Loans  5,151,984   4,911,770   4,631,822   4,536,338   4,340,900  
Debt securities  526,023   447,427   377,270   347,706   362,106  
Non-interest-bearing demand deposits  1,292,440   1,281,605   1,269,726   1,185,668   1,070,275  
Total deposits  5,361,532   5,420,311   5,081,128   4,664,795   4,339,747  
Borrowings  55,169   55,262   55,356   55,450   55,543  
Stockholders' equity $545,148  $522,889  $507,866  $489,097  $470,940  
                      
Shares outstanding (1)  52,812,396   52,636,896   52,610,896   52,503,896   52,365,396  
Book value per share (1) $10.32  $9.93  $9.65  $9.32  $8.99  
Tangible book value per share (1) (2) $10.04  $9.65  $9.37  $9.03  $8.70  
                      
SELECTED FINANCIAL RATIOS                     
Net interest margin  3.53%  3.30%  3.35%  3.51%  3.57% 
Return on average assets  1.45%  1.39%  1.39%  1.37%  1.53% 
Return on average common stockholders' equity  17.09%  16.71%  16.66%  15.79%  17.39% 
Efficiency ratio  37.58%  39.96%  38.25%  39.21%  40.51% 
Non-interest expense to average earning assets  1.43%  1.46%  1.39%  1.50%  1.56% 
                      
CAPITAL RATIOS (3)                     
Common equity tier 1 capital to risk-weighted assets  9.67%  9.78%  9.91%  9.83%  9.90% 
Tier 1 capital to risk-weighted assets  9.68%  9.78%  9.92%  9.84%  9.91% 
Total capital to risk-weighted assets  11.66%  11.84%  12.03%  11.98%  12.12% 
Tier 1 capital to average assets  8.46%  8.22%  8.20%  8.52%  8.65% 
Tangible common equity to total tangible assets (2)  8.39%  7.99%  8.23%  8.42%  8.50% 
                      
(1) Adjusted to reflect two-for-one stock split that occurred on December 20, 2016.  
(2) See "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" for a discussion of these Non-GAAP financial measures. 
(3) Regulatory capital ratios for most recent period are preliminary. 


CONSOLIDATED BALANCE SHEETS (UNAUDITED)          
(Dollars in thousands)          
    March 31, 2017 March 31, 2016 % Change 
ASSETS          
Cash and due from banks $54,993  $56,714  (3)% 
Interest-bearing balances due from depository institutions  283,181   440,513  (36)% 
Federal funds sold  127,390   28,410  348 % 
 Cash and cash equivalents  465,564   525,637  (11)% 
Available for sale debt securities, at fair value  453,956   334,567  36 % 
Held to maturity debt securities (fair value of $73,180 and $28,409 at          
 March 31, 2017 and 2016, respectively)  72,057   27,539  162 % 
Restricted equity securities  1,034   5,667  (82)% 
Mortgage loans held for sale  6,599   5,090  30 % 
Loans  5,151,984   4,340,900  19 % 
Less allowance for loan losses  (53,892)  (45,145) 19 % 
 Loans, net  5,098,092   4,295,755  19 % 
Premises and equipment, net  46,407   20,989  121 % 
Goodwill and other identifiable intangible assets  14,924   15,239  (2)% 
Other assets  177,532   148,116  20 % 
 Total assets $6,336,165  $5,378,599  18 % 
LIABILITIES AND STOCKHOLDERS' EQUITY          
Liabilities:          
Deposits:          
 Non-interest-bearing $1,292,440  $1,070,275  21 % 
 Interest-bearing  4,069,092   3,269,472  24 % 
  Total deposits  5,361,532   4,339,747  24 % 
Federal funds purchased  358,241   497,885  (28)% 
Other borrowings  55,169   55,543  (1)% 
Other liabilities  16,075   14,484  11 % 
 Total liabilities  5,791,017   4,907,659  18 % 
Stockholders' equity:          
 Preferred stock, Series A Senior Non-Cumulative Perpetual, par value $0.001          
  (liquidation preference $1,000), net of discount; no shares authorized or outstanding          
  at March 31, 2017 and 2016  -   -  - % 
 Preferred stock, par value $0.001 per share; 1,000,000 authorized and undesignated at          
  March 31, 2017, and 1,000,000 authorized and 960,000 undesignated at March 31, 2016  -   -  - % 
 Common stock, par value $0.001 per share; 100,000,000 shares authorized; 52,8712,396 shares          
  issued and outstanding at March 31, 2017, and 52,365,396 shares issued and outstanding at          
  March 31, 2016 (1)  53   53  - % 
 Additional paid-in capital  217,195   215,932  1 % 
 Retained earnings  327,029   307,151  6 % 
 Accumulated other comprehensive income  369   (624) (159)% 
 Noncontrolling interest  502   377  33 % 
  Total stockholders' equity  545,148   522,889  4 % 
 Total liabilities and stockholders' equity $6,336,165  $6,370,448  (1)% 
             
(1) Adjusted to reflect two-for-one stock split that occurred on December 20, 2016. 


CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
 
(In thousands except per share data)
 
    Three Months Ended March 31, 
    2017 2016 
Interest income:       
 Interest and fees on loans $55,556 $47,247 
 Taxable securities  2,087  1,269 
 Nontaxable securities  765  858 
 Federal funds sold  519  73 
 Other interest and dividends  590  514 
 Total interest income  59,517  49,961 
Interest expense:       
 Deposits  5,982  4,361 
 Borrowed funds  1,483  1,421 
 Total interest expense  7,465  5,782 
 Net interest income  52,052  44,179 
Provision for loan losses  4,986  2,059 
 Net interest income after provision for loan losses  47,066  42,120 
Non-interest income:       
 Service charges on deposit accounts  1,354  1,307 
 Mortgage banking  899  668 
 Increase in cash surrender value life insurance  724  624 
 Other operating income  1,569  836 
 Total non-interest income  4,546  3,435 
Non-interest expense:       
 Salaries and employee benefits  11,713  11,067 
 Equipment and occupancy expense  2,250  1,985 
 Professional services  771  738 
 FDIC and other regulatory assessments  997  750 
 Other real estate owned expense  76  449 
 Other operating expense  5,460  4,301 
 Total non-interest expense  21,267  19,290 
 Income before income tax  30,345  26,265 
Provision for income tax  7,826  6,309 
 Net income  22,519  19,956 
 Dividends on preferred stock  -  - 
 Net income available to common stockholders $22,519 $19,956 
Basic earnings per common share (1) $0.43 $0.38 
Diluted earnings per common share (1) $0.42 $0.38 
          
(1) Adjusted to reflect two-for-one stock split that occurred on December 20, 2016.


LOANS BY TYPE (UNAUDITED)               
(In thousands)               
                 
   1st Quarter 2017 4th Quarter 2016 3rd Quarter 2016 2nd Quarter 2016 1st Quarter 2016
Commercial, financial and agricultural $2,061,503 $1,982,267 $1,885,315 $1,892,870 $1,799,132
Real estate - construction  345,777  335,085  292,721  251,144  254,254
Real estate - mortgage:               
 Owner-occupied commercial  1,262,578  1,171,719  1,138,308  1,117,514  1,055,852
 1-4 family mortgage  554,261  536,805  520,394  494,733  458,032
 Other mortgage  872,955  830,683  740,127  725,336  723,542
Subtotal: Real estate - mortgage  2,689,794  2,539,207  2,398,829  2,337,583  2,237,426
Consumer  54,910  55,211  54,957  54,741  50,088
Total loans $5,151,984 $4,911,770 $4,631,822 $4,536,338 $4,340,900
                


SUMMARY OF LOAN LOSS EXPERIENCE (UNAUDITED) 
(Dollars in thousands) 
     1st Quarter 2017 4th Quarter 2016 3rd Quarter 2016 2nd Quarter 2016 1st Quarter 2016 
Allowance for loan losses:                     
Beginning balance $51,893   $48,933  $46,998   $45,145   $43,419   
Loans charged off:                     
 Commercial financial and agricultural  2,855    1,059   1,270    1,412    50   
 Real estate - construction  -    -   79    355    381   
 Real estate - mortgage  266    45   144    191    -   
 Consumer  75    82   81    31    18   
  Total charge offs  3,196    1,186   1,574    1,989    449   
Recoveries:                     
 Commercial financial and agricultural  190    10   35    1    3   
 Real estate - construction  16    12   9    39    16   
 Real estate - mortgage  2    46   1    2    97   
 Consumer  1    3   -    -    -   
  Total recoveries  209    71   45    42    116   
 Net charge-offs  2,987    1,115   1,529    1,947    333   
 Provision for loan losses  4,986    4,075   3,464    3,800    2,059   
 Ending balance $53,892   $51,893  $48,933   $46,998   $45,145   
                         
 Allowance for loan losses to total loans  1.05 %  1.06%  1.05 %  1.04 %  1.04 % 
 Allowance for loan losses to total average                     
  loans  1.08 %  1.10%  1.07 %  1.06 %  1.06 % 
 Net charge-offs to total average loans  0.24 %  0.09%  0.13 %  0.18 %  0.03 % 
 Provision for loan losses to total average                     
  loans  0.40 %  0.34%  0.30 %  0.34 %  0.20 % 
 Nonperforming assets:                     
  Nonaccrual loans $12,084   $10,624  $6,647   $4,730   $6,133   
  Loans 90+ days past due and accruing  16    6,263   43    423    417   
  Other real estate owned and                     
  repossessed assets  5,102    4,988   3,035    4,260    4,044   
 Total $17,202   $21,875  $9,725   $9,413   $10,594   
                         
 Nonperforming loans to total loans  0.23 %  0.34%  0.14 %  0.11 %  0.15 % 
 Nonperforming assets to total assets  0.27 %  0.34%  0.16 %  0.17 %  0.20 % 
 Nonperforming assets to earning assets  0.28 %  0.35%  0.16 %  0.17 %  0.20 % 
 Reserve for loan losses to nonaccrual loans  445.98 %  488.45%  736.17 %  993.62 %  736.10 % 
                         
 Restructured accruing loans $536   $558  $6,738   $6,753   $6,763   
                         
 Restructured accruing loans to total loans  0.01 %  0.01%  0.14 %  0.15 %  0.16 % 
                         
 TROUBLED DEBT RESTRUCTURINGS (TDRs) (UNAUDITED)
 
 (In thousands)                 
     1st Quarter 2017 4th Quarter 2016 3rd Quarter 2016 2nd Quarter 2016 1st Quarter 2016 
 Beginning balance: $7,292   $6,738  $6,753   $6,763   $7,736   
  Net (paydowns) / advances  (23)   554   (15)   (10)   (19)  
  Transfers to other real estate owned  -    -   -    -    (954)  
     $7,269   $7,292  $6,738   $6,753   $6,763   


CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
 
(In thousands except per share data)
 
    1st Quarter
2017
 4th Quarter
2016
 3rd Quarter
2016
 2nd Quarter
2016
 1st Quarter
2016
 
Interest income:                
 Interest and fees on loans $55,556 $52,533 $51,598 $49,210  $47,247 
 Taxable securities  2,087  1,604  1,107  1,238   1,269 
 Nontaxable securities  765  785  823  834   858 
 Federal funds sold  519  377  347  210   73 
 Other interest and dividends  590  901  816  558   514 
 Total interest income  59,517  56,200  54,691  52,050   49,961 
Interest expense:                
 Deposits  5,982  5,817  5,358  4,611   4,361 
 Borrowed funds  1,483  1,274  1,415  1,548   1,421 
 Total interest expense  7,465  7,091  6,773  6,159   5,782 
 Net interest income  52,052  49,109  47,918  45,891   44,179 
Provision for loan losses  4,986  4,075  3,464  3,800   2,059 
 Net interest income after provision for loan losses  47,066  45,034  44,454  42,091   42,120 
Non-interest income:                
 Service charges on deposit accounts  1,354  1,375  1,367  1,306   1,307 
 Mortgage banking  899  1,044  1,112  901   668 
 Securities gains  -  -  -  (3)  - 
 Increase in cash surrender value life insurance  724  745  770  655   624 
 Other operating income  1,569  2,875  1,542  988   836 
 Total non-interest income  4,546  6,039  4,791  3,847   3,435 
Non-interest expense:                
 Salaries and employee benefits  11,713  11,197  10,958  10,733   11,067 
 Equipment and occupancy expense  2,250  1,877  2,100  2,023   1,985 
 Professional services  771  1,058  1,182  999   738 
 FDIC and other regulatory assessments  997  1,072  775  803   750 
 Other real estate owned expense  76  91  178  41   449 
 Other operating expense  5,460  6,742  4,969  4,905   4,301 
 Total non-interest expense  21,267  22,037  20,162  19,504   19,290 
 Income before income tax  30,345  29,036  29,083  26,434   26,265 
Provision for income tax  7,826  7,298  8,174  7,558   6,309 
 Net income  22,519  21,738  20,909  18,876   19,956 
 Dividends on preferred stock  -  24  -  23   - 
 Net income available to common stockholders $22,519 $21,714 $20,909 $18,853  $19,956 
Basic earnings per common share (1) $0.43 $0.41 $0.40 $0.36  $0.38 
Diluted earnings per common share (1) $0.42 $0.40 $0.39 $0.36  $0.38 
                   
(1) Adjusted to reflect two-for-one stock split that occurred on December 20, 2016. 


AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS (UNAUDITED) 
ON A FULLY TAXABLE-EQUIVALENT BASIS 
(Dollars in thousands) 
  
      1st Quarter 2017 4th Quarter 2016 3rd Quarter 2016 2nd Quarter 2016 1st Quarter 2016 
      Average
Balance
 Yield /
Rate
 Average
Balance
 Yield /
Rate
 Average
Balance
 Yield /
Rate
 Average
Balance
 Yield /
Rate
 Average
Balance
 Yield /
Rate
 
Assets:                               
Interest-earning assets:                               
 Loans, net of unearned income (1)                               
  Taxable $4,976,933  4.50% $4,676,565 4.45% $4,554,900 4.47% $4,406,107 4.47% $4,230,057 4.48% 
  Tax-exempt (2)  27,322  4.72   26,344 4.74   21,939 4.37   16,315 4.54   10,281 5.59  
   Total loans, net of                               
    unearned income  5,004,255  4.51   4,702,909 4.45   4,576,839 4.47   4,422,422 4.47   4,240,338 4.48  
 Mortgage loans held for sale  5,637  4.10   6,271 3.36   6,724 3.79   7,323 3.62   6,084 4.63  
 Debt securities:                               
  Taxable  368,349  2.27   295,608 2.17   224,825 2.19   208,113 2.38   221,722 2.29  
  Tax-exempt (2)  132,578  3.45   134,748 3.54   135,272 3.73   135,954 3.73   137,763 3.79  
   Total securities (3)  500,927  2.58   430,356 2.60   360,097 2.77   344,067 2.91   359,485 2.86  
 Federal funds sold  234,460  0.90   242,211 0.62   217,158 0.64   144,206 0.59   48,390 0.61  
 Restricted equity securities  1,030  1.57   3,042 8.24   5,658 4.01   5,659 3.62   4,962 3.81  
 Interest-bearing balances with banks  295,648  0.80   601,143 0.55   590,675 0.51   393,782 0.52   373,339 0.51  
 Total interest-earning assets  6,041,957  4.03%  5,985,932 3.77%  5,757,151 3.81%  5,317,459 3.97%  5,032,598 4.03% 
Non-interest-earning assets:                               
 Cash and due from banks  59,697      55,593     58,809     65,318     61,578    
 Net premises and equipment  44,739      30,421     25,000     23,241     21,023    
 Allowance for loan losses, accrued                               
  interest and other assets  138,289      140,721     145,804     127,640     126,491    
   Total assets $6,284,682     $6,212,667    $5,986,764    $5,533,658    $5,241,690    
                                    
Interest-bearing liabilities:                               
 Interest-bearing deposits:                               
 Checking $789,273  0.38% $735,115 0.37% $696,100 0.37% $691,776 0.36% $665,039 0.35% 
 Savings  50,461  0.33   51,845 0.32   43,569 0.30   41,546 0.30   41,055 0.29  
 Money market  2,694,225  0.58   2,669,513 0.56   2,471,829 0.55   2,105,420 0.52   1,979,727 0.51  
 Time deposits  530,000  1.02   527,100 1.00   519,653 0.99   498,151 1.01   507,605 1.00  
  Total interest-bearing deposits  4,063,959  0.60   3,983,573 0.58   3,731,151 0.57   3,336,893 0.56   3,193,426 0.55  
 Federal funds purchased  359,747  0.86   353,029 0.63   436,415 0.64   505,076 0.64   441,309 0.64  
 Other borrowings  55,239  5.26   55,315 5.16   55,410 5.15   55,521 5.20   55,630 5.19  
 Total interest-bearing liabilities  4,478,945  0.68%  4,391,917 0.64%  4,222,976 0.64%  3,897,490 0.64%  3,690,365 0.63% 
Non-interest-bearing liabilities:                               
 Non-interest-bearing                               
  demand deposits  1,254,496      1,289,448     1,250,139     1,142,541     1,077,613    
 Other liabilities  16,809      14,399     14,376     13,301     12,194    
 Stockholders' equity  535,232      514,245     494,248     475,917     457,218    
 Unrealized gains on securities and                               
  derivatives  (800)     2,658     5,025     4,409     4,300    
   Total liabilities and                               
    stockholders' equity $6,284,682     $6,212,667    $5,986,764    $5,533,658    $5,241,690    
Net interest spread    3.35%    3.13%    3.18%    3.34%    3.40% 
Net interest margin    3.53%    3.30%    3.35%    3.51%    3.57% 
                                    
(1) Average loans include loans on which the accrual of interest has been discontinued. 
(2) Interest income and yields are presented on a fully taxable equivalent basis using a tax rate of 35%. 
(3) Unrealized gains on available-for-sale debt securities are excluded from the yield calculation. 

 

CONTACT: ServisFirst Bank
Davis Mange (205) 949-3420
[email protected]

Primary Logo

Source: ServisFirst Bancshares, Inc.