BLUEFIELD, Va., Jan. 23, 2019 (GLOBE NEWSWIRE) — First Community Bankshares, Inc. (NASDAQ: FCBC) (www.firstcommunitybank.com) (the “Company”) today reported its unaudited results of operations and other financial information for the quarter and year ended December 31, 2018. The Company reported net income of $9.31 million, or $0.57 per diluted common share, for the quarter ended December 31, 2018, which was an increase of $8.09 million from the same quarter of 2017. The Company also reported $36.34 million, or $2.18 per diluted common share, for the year ended December 31, 2018, which was an increase of $14.86 million from 2017. The fourth quarter and full year both constitute net income records for the respective periods.
The Company also announced today that the Board of Directors declared a quarterly cash dividend to common shareholders of twenty-one cents ($0.21) per common share. The quarterly dividend is payable to common shareholders of record on February 1, 2019, and is expected to be paid on or about February 15, 2019. The current year marks the 34th consecutive year of regular cash dividends paid to shareholders.
The Company’s capital management plan and philosophy require maintenance of a strong capital base from which to grow and serve customers. As reported in early 2018, absent other needs, the Company’s capital management plan aspires to return current earnings not needed to fund growth in core operations back to shareholders through regular cash dividends and stock repurchases. The Company earned approximately $36.34 million in 2018, from which it paid regular cash dividends of approximately $12.96 million. The Company also repurchased 1,060,312 common shares for approximately $34.41 million. Since regular dividends and stock repurchases returned all current earnings to shareholders, the Board of Directors determined not to declare a special dividend related to 2018 earnings. As of December 31, 2018, the Company continues to significantly exceed regulatory “well capitalized” targets, as well as all capital targets of its capital management plan.
Fourth Quarter 2018 Highlights
- General
- On October 1, 2018, the Company completed the sale of its remaining insurance agency assets to Bankers Insurance, LLC of Glen Allen, Virginia (“BI”) in exchange for an equity interest in BI.
- On October 2, 2018, the Company completed its Plan of Reincorporation and Merger, the sole purpose of which was to change the Company’s state of incorporation from Nevada to Virginia.
- Income Statement
- Net income increased $8.09 million to $9.31 million compared to the same quarter of 2017. The large increase reflects the deferred tax asset revaluation charge taken in the fourth quarter of 2017. Non-GAAP adjusted earnings increased $1.82 million to $9.50 million compared to the same quarter of 2017.
- Diluted earnings per share increased $0.50 to $0.57 compared to the same quarter of 2017. Again, the large increase reflects the deferred tax asset revaluation charge taken in the fourth quarter of 2017. Non-GAAP adjusted diluted earnings per share increased $0.13 to $0.58 compared to the same quarter of 2017.
- Return on average assets (“ROAA”) for the quarter increased to 1.63%, the highest reported quarterly ROAA for the Company in 15 years. Return on average equity for the quarter increased to 11.01%.
- Net interest margin increased 63 basis points to 4.80% compared to the same quarter of 2017.
- Balance Sheet
- Book value per common share increased $0.16 to $20.79, and tangible book value per common share increased $0.05 to $14.69, compared to December 31, 2017.
- The Company repurchased 390,296 common shares for $13.12 million during the quarter and 1,060,312 common shares for $34.41 million during the year ended December 31, 2018.
- The Company and its subsidiary bank both significantly exceed regulatory “well capitalized” targets as of December 31, 2018.
Non-GAAP Financial Measures
In addition to financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses certain non-GAAP financial measures that provide useful information for financial and operational decision making, evaluating trends, and comparing financial results to other financial institutions. The non-GAAP financial measures presented in this news release include “tangible book value per common share,” “return on average tangible common equity,” “adjusted earnings,” “adjusted diluted earnings per share,” “adjusted return on average assets,” “adjusted return on average common equity,” “adjusted return on average tangible common equity,” and certain financial measures presented on a fully taxable equivalent (“FTE”) basis. FTE basis is calculated using the federal statutory income tax rate of 21% for periods after January 1, 2018, and 35% for periods prior to January 1, 2018. While the Company believes certain non-GAAP financial measures enhance the understanding of its business and performance, they are supplemental and not a substitute for, or more important than, financial measures prepared in accordance with GAAP and may not be comparable to those reported by other financial institutions.
About First Community Bankshares, Inc.
First Community Bankshares, Inc., a financial holding company headquartered in Bluefield, Virginia, provides banking products and services through its wholly owned subsidiary First Community Bank. First Community Bank operated 44 branch banking locations in Virginia, West Virginia, North Carolina, and Tennessee as of December 31, 2018. First Community Bank offers wealth management and investment advice through its Trust Division and First Community Wealth Management, which collectively managed and administered $975 million in combined assets as of December 31, 2018. The Company reported consolidated assets of $2.24 billion as of December 31, 2018. The Company’s common stock is listed on the NASDAQ Global Select Market under the trading symbol, “FCBC”. Additional investor information is available on the Company’s website at www.firstcommunitybank.com.
This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the Company’s Securities and Exchange Commission reports including, but not limited to, the Annual Report on Form 10-K for the most recent fiscal year end. Pursuant to the Private Securities Litigation Reform Act of 1995, the Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) | ||||||||||||||||||||||||||||
| Three Months Ended | Year Ended | |||||||||||||||||||||||||||
| (Amounts in thousands, except share and per share data) |
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | ||||||||||||||||||||||
| 2018 | 2018 | 2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||
| Interest income | ||||||||||||||||||||||||||||
| Interest and fees on loans | $ | 23,938 | $ | 22,556 | $ | 22,422 | $ | 22,755 | $ | 22,314 | $ | 91,671 | $ | 89,749 | ||||||||||||||
| Interest on securities | 1,249 | 1,372 | 1,361 | 1,104 | 1,095 | 5,086 | 4,551 | |||||||||||||||||||||
| Interest on deposits in banks | 194 | 358 | 514 | 471 | 353 | 1,537 | 1,008 | |||||||||||||||||||||
| Total interest income | 25,381 | 24,286 | 24,297 | 24,330 | 23,762 | 98,294 | 95,308 | |||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||||
| Interest on deposits | 1,297 | 1,269 | 1,327 | 1,251 | 1,313 | 5,144 | 4,987 | |||||||||||||||||||||
| Interest on borrowings | 205 | 692 | 708 | 700 | 716 | 2,305 | 3,103 | |||||||||||||||||||||
| Total interest expense | 1,502 | 1,961 | 2,035 | 1,951 | 2,029 | 7,449 | 8,090 | |||||||||||||||||||||
| Net interest income | 23,879 | 22,325 | 22,262 | 22,379 | 21,733 | 90,845 | 87,218 | |||||||||||||||||||||
| Provision for loan losses | 908 | 495 | 495 | 495 | 615 | 2,393 | 2,771 | |||||||||||||||||||||
| Net interest income after provision | 22,971 | 21,830 | 21,767 | 21,884 | 21,118 | 88,452 | 84,447 | |||||||||||||||||||||
| Noninterest income | 6,297 | 6,519 | 6,959 | 6,668 | 7,498 | 26,443 | 24,568 | |||||||||||||||||||||
| Noninterest expense | 17,366 | 18,131 | 17,160 | 17,116 | 16,683 | 69,773 | 66,902 | |||||||||||||||||||||
| Income before income taxes | 11,902 | 10,218 | 11,566 | 11,436 | 11,933 | 45,122 | 42,113 | |||||||||||||||||||||
| Income tax expense | 2,596 | 1,118 | 2,500 | 2,568 | 10,720 | 8,782 | 20,628 | |||||||||||||||||||||
| Net income | $ | 9,306 | $ | 9,100 | $ | 9,066 | $ | 8,868 | $ | 1,213 | $ | 36,340 | $ | 21,485 | ||||||||||||||
| Earnings per common share | ||||||||||||||||||||||||||||
| Basic | $ | 0.57 | $ | 0.55 | $ | 0.54 | $ | 0.52 | $ | 0.07 | $ | 2.19 | $ | 1.26 | ||||||||||||||
| Diluted | 0.57 | 0.55 | 0.54 | 0.52 | 0.07 | 2.18 | 1.26 | |||||||||||||||||||||
| Cash dividends per common share | ||||||||||||||||||||||||||||
| Regular | 0.21 | 0.21 | 0.18 | 0.18 | 0.18 | 0.78 | 0.68 | |||||||||||||||||||||
| Special | – | – | – | 0.48 | – | 0.48 | – | |||||||||||||||||||||
| Weighted average shares outstanding | ||||||||||||||||||||||||||||
| Basic | 16,201,148 | 16,512,823 | 16,689,398 | 16,955,758 | 16,992,519 | 16,587,504 | 17,002,116 | |||||||||||||||||||||
| Diluted | 16,280,404 | 16,612,416 | 16,788,615 | 17,047,638 | 17,083,949 | 16,666,385 | 17,077,842 | |||||||||||||||||||||
| Performance ratios | ||||||||||||||||||||||||||||
| Return on average assets | 1.63 | % | 1.55 | % | 1.53 | % | 1.52 | % | 0.20 | % | 1.56 | % | 0.91 | % | ||||||||||||||
| Return on average common equity | 11.01 | % | 10.59 | % | 10.68 | % | 10.30 | % | 1.35 | % | 10.64 | % | 6.14 | % | ||||||||||||||
| Return on average tangible common equity(1) | 15.58 | % | 15.06 | % | 15.21 | % | 14.53 | % | 1.89 | % | 15.09 | % | 8.69 | % | ||||||||||||||
| (1) | A non-GAAP financial measure defined as net income divided by average stockholders’ equity less average goodwill and other intangible assets | |||||||||||||||||||||||||||
| RECONCILIATION OF GAAP NET INCOME TO NON-GAAP ADJUSTED EARNINGS (Unaudited) | ||||||||||||||||||||||||||||
| Three Months Ended | Year Ended | |||||||||||||||||||||||||||
| December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | |||||||||||||||||||||||
| 2018 | 2018 | 2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||
| (Amounts in thousands, except per share data) | ||||||||||||||||||||||||||||
| Net income | $ | 9,306 | $ | 9,100 | $ | 9,066 | $ | 8,868 | $ | 1,213 | $ | 36,340 | $ | 21,485 | ||||||||||||||
| Non-GAAP adjustments: | ||||||||||||||||||||||||||||
| Net loss on sale of securities | – | 618 | – | – | 4 | 618 | 661 | |||||||||||||||||||||
| Loss on extinguishment of debt | – | 1,096 | – | – | – | 1,096 | – | |||||||||||||||||||||
| Goodwill impairment | – | 1,492 | – | – | – | 1,492 | – | |||||||||||||||||||||
| Deferred tax asset revaluation | – | (1,669 | ) | – | – | 6,552 | (1,669 | ) | 6,552 | |||||||||||||||||||
| Other items(1) | 254 | – | 297 | (130 | ) | (140 | ) | 421 | (298 | ) | ||||||||||||||||||
| Total adjustments | 254 | 1,537 | 297 | (130 | ) | 6,416 | 1,958 | 6,915 | ||||||||||||||||||||
| Tax effect | 61 | 411 | 96 | (24 | ) | (50 | ) | 544 | 301 | |||||||||||||||||||
| Adjusted earnings, non-GAAP | $ | 9,499 | $ | 10,226 | $ | 9,267 | $ | 8,762 | $ | 7,679 | $ | 37,754 | $ | 28,099 | ||||||||||||||
| Adjusted diluted earnings per common share, non-GAAP | $ | 0.58 | $ | 0.62 | $ | 0.55 | $ | 0.51 | $ | 0.45 | $ | 2.27 | $ | 1.65 | ||||||||||||||
| Performance ratios, non-GAAP | ||||||||||||||||||||||||||||
| Adjusted return on average assets | 1.67 | % | 1.74 | % | 1.57 | % | 1.50 | % | 1.28 | % | 1.62 | % | 1.19 | % | ||||||||||||||
| Adjusted return on average common equity | 11.23 | % | 11.90 | % | 10.91 | % | 10.17 | % | 8.56 | % | 11.05 | % | 8.04 | % | ||||||||||||||
| Adjusted return on average tangible common equity(2) | 15.90 | % | 16.93 | % | 15.55 | % | 14.36 | % | 11.99 | % | 15.68 | % | 11.36 | % | ||||||||||||||
| (1) | Includes other non-recurring income and expense items | |||||||||||||||||||||||||||
| (2) | A non-GAAP financial measure defined as adjusted earnings divided by average stockholders’ equity less average goodwill and other intangible assets | |||||||||||||||||||||||||||
| AVERAGE BALANCE SHEETS AND NET INTEREST INCOME ANALYSIS (Unaudited) | ||||||||||||||||
| Three Months Ended December 31, | ||||||||||||||||
| 2018 | 2017 | |||||||||||||||
| Average | Average Yield/ | Average | Average Yield/ | |||||||||||||
| (Amounts in thousands) | Balance | Interest(1) | Rate(1) | Balance | Interest(1) | Rate(1) | ||||||||||
| Assets | ||||||||||||||||
| Earning assets | ||||||||||||||||
| Loans(2)(3) | $ | 1,788,570 | $ | 24,017 | 5.33% | $ | 1,822,583 | $ | 22,387 | 4.87% | ||||||
| Securities available for sale | 162,330 | 1,518 | 3.71% | 171,288 | 1,383 | 3.20% | ||||||||||
| Securities held to maturity | 25,030 | 104 | 1.65% | 25,165 | 105 | 1.66% | ||||||||||
| Interest-bearing deposits | 33,736 | 194 | 2.28% | 95,174 | 353 | 1.47% | ||||||||||
| Total earning assets | 2,009,666 | 25,833 | 5.10% | 2,114,210 | 24,228 | 4.55% | ||||||||||
| Other assets | 249,056 | 256,591 | ||||||||||||||
| Total assets | $ | 2,258,722 | $ | 2,370,801 | ||||||||||||
| Liabilities and stockholders’ equity | ||||||||||||||||
| Interest-bearing deposits | ||||||||||||||||
| Demand deposits | $ | 458,458 | $ | 40 | 0.03% | $ | 451,024 | $ | 62 | 0.05% | ||||||
| Savings deposits | 494,868 | 132 | 0.11% | 512,156 | 83 | 0.06% | ||||||||||
| Time deposits | 450,770 | 1,125 | 0.99% | 502,515 | 1,168 | 0.92% | ||||||||||
| Total interest-bearing deposits | 1,404,096 | 1,297 | 0.37% | 1,465,695 | 1,313 | 0.36% | ||||||||||
| Borrowings | ||||||||||||||||
| Retail repurchase agreements | 4,526 | 2 | 0.18% | 5,470 | 1 | 0.07% | ||||||||||
| Wholesale repurchase agreements | 25,000 | 203 | 3.22% | 25,000 | 204 | 3.24% | ||||||||||
| FHLB advances and other borrowings | – | – | – | 50,000 | 511 | 4.05% | ||||||||||
| Total borrowings | 29,526 | 205 | 2.75% | 80,470 | 716 | 3.53% | ||||||||||
| Total interest-bearing liabilities | 1,433,622 | 1,502 | 0.42% | 1,546,165 | 2,029 | 0.52% | ||||||||||
| Noninterest-bearing demand deposits | 461,457 | 446,487 | ||||||||||||||
| Other liabilities | 28,188 | 22,103 | ||||||||||||||
| Total liabilities | 1,923,267 | 2,014,755 | ||||||||||||||
| Stockholders’ equity | 335,455 | 356,046 | ||||||||||||||
| Total liabilities and stockholders’ equity | $ | 2,258,722 | $ | 2,370,801 | ||||||||||||
| Net interest income, FTE(1) | $ | 24,331 | $ | 22,199 | ||||||||||||
| Net interest rate spread | 4.68% | 4.03% | ||||||||||||||
| Net interest margin, FTE(1) | 4.80% | 4.17% | ||||||||||||||
| (1) | Interest income and average yield/rate are presented on a FTE, non-GAAP, basis using the federal statutory income tax rate of 21% for periods after January 1, 2018, and 35% for periods prior to January 1, 2018. | |||||||||||||||
| (2) | Nonaccrual loans are included in the average balance; however, no related interest income is recorded during the period of nonaccrual. | |||||||||||||||
| (3) | Interest on loans include non-cash purchase accounting accretion of $2.13 million and $1.16 million for the three months ended December 31, 2018 and 2017, respectively. | |||||||||||||||
| AVERAGE BALANCE SHEETS AND NET INTEREST INCOME ANALYSIS (Unaudited) | ||||||||||||||||
| Year Ended December 31, | ||||||||||||||||
| 2018 | 2017 | |||||||||||||||
| Average | Average Yield/ | Average | Average Yield/ | |||||||||||||
| (Amounts in thousands) | Balance | Interest(1) | Rate(1) | Balance | Interest(1) | Rate(1) | ||||||||||
| Assets | ||||||||||||||||
| Earning assets | ||||||||||||||||
| Loans(2)(3) | $ | 1,795,391 | $ | 91,971 | 5.12% | $ | 1,837,092 | $ | 90,032 | 4.90% | ||||||
| Securities available for sale | 176,766 | 6,190 | 3.50% | 164,489 | 5,695 | 3.46% | ||||||||||
| Securities held to maturity | 25,081 | 418 | 1.67% | 32,954 | 487 | 1.48% | ||||||||||
| Interest-bearing deposits | 81,520 | 1,537 | 1.89% | 73,405 | 1,008 | 1.37% | ||||||||||
| Total earning assets | 2,078,758 | 100,116 | 4.82% | 2,107,940 | 97,222 | 4.61% | ||||||||||
| Other assets | 251,853 | 262,381 | ||||||||||||||
| Total assets | $ | 2,330,611 | $ | 2,370,321 | ||||||||||||
| Liabilities and stockholders’ equity | ||||||||||||||||
| Interest-bearing deposits | ||||||||||||||||
| Demand deposits | $ | 466,403 | $ | 246 | 0.05% | $ | 401,092 | $ | 224 | 0.06% | ||||||
| Savings deposits | 508,353 | 382 | 0.08% | 520,430 | 336 | 0.06% | ||||||||||
| Time deposits | 471,335 | 4,516 | 0.96% | 510,411 | 4,427 | 0.87% | ||||||||||
| Total interest-bearing deposits | 1,446,091 | 5,144 | 0.36% | 1,431,933 | 4,987 | 0.35% | ||||||||||
| Borrowings | ||||||||||||||||
| Federal funds purchased | – | – | – | 1 | – | – | ||||||||||
| Retail repurchase agreements | 4,010 | 5 | 0.12% | 47,716 | 32 | 0.07% | ||||||||||
| Wholesale repurchase agreements | 25,000 | 806 | 3.22% | 25,000 | 806 | 3.22% | ||||||||||
| FHLB advances and other borrowings | 36,849 | 1,494 | 4.05% | 55,502 | 2,265 | 4.08% | ||||||||||
| Total borrowings | 65,859 | 2,305 | 3.50% | 128,219 | 3,103 | 2.42% | ||||||||||
| Total interest-bearing liabilities | 1,511,950 | 7,449 | 0.49% | 1,560,152 | 8,090 | 0.52% | ||||||||||
| Noninterest-bearing demand deposits | 448,903 | 438,513 | ||||||||||||||
| Other liabilities | 28,239 | 21,955 | ||||||||||||||
| Total liabilities | 1,989,092 | 2,020,620 | ||||||||||||||
| Stockholders’ equity | 341,519 | 349,701 | ||||||||||||||
| Total liabilities and stockholders’ equity | $ | 2,330,611 | $ | 2,370,321 | ||||||||||||
| Net interest income, FTE(1) | $ | 92,667 | $ | 89,132 | ||||||||||||
| Net interest rate spread | 4.33% | 4.09% | ||||||||||||||
| Net interest margin, FTE(1) | 4.46% | 4.23% | ||||||||||||||
| (1) | Interest income and average yield/rate are presented on a FTE, non-GAAP, basis using the federal statutory income tax rate of 21% for periods after January 1, 2018, and 35% for periods prior to January 1, 2018. | |||||||||||||||
| (2) | Nonaccrual loans are included in the average balance; however, no related interest income is recorded during the period of nonaccrual. | |||||||||||||||
| (3) | Interest on loans include non-cash purchase accounting accretion of $6.39 million and $5.42 million for the year ended December 31, 2018 and 2017, respectively. | |||||||||||||||
| CONDENSED CONSOLIDATED QUARTERLY NONINTEREST INCOME AND EXPENSE (Unaudited) | ||||||||||||||||||||||||||||
| Three Months Ended | Year Ended | |||||||||||||||||||||||||||
| December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | |||||||||||||||||||||||
| (Amounts in thousands) | 2018 | 2018 | 2018 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||
| Noninterest income | ||||||||||||||||||||||||||||
| Wealth management | $ | 854 | $ | 791 | $ | 823 | $ | 794 | $ | 811 | $ | 3,262 | $ | 3,150 | ||||||||||||||
| Service charges on deposits | 3,850 | 3,803 | 3,612 | 3,468 | 3,725 | 14,733 | 13,803 | |||||||||||||||||||||
| Other service charges and fees | 2,017 | 1,925 | 1,934 | 1,857 | 1,788 | 7,733 | 6,944 | |||||||||||||||||||||
| Insurance commissions | – | 299 | 338 | 329 | 343 | 966 | 1,347 | |||||||||||||||||||||
| Net loss on sale of securities | – | (618 | ) | – | – | (4 | ) | (618 | ) | (661 | ) | |||||||||||||||||
| Net FDIC indemnification asset amortization | (579 | ) | (645 | ) | (575 | ) | (382 | ) | (331 | ) | (2,181 | ) | (3,517 | ) | ||||||||||||||
| Other operating income | 155 | 964 | 827 | 602 | 1,166 | 2,548 | 3,502 | |||||||||||||||||||||
| Total noninterest income | $ | 6,297 | $ | 6,519 | $ | 6,959 | $ | 6,668 | $ | 7,498 | $ | 26,443 | $ | 24,568 | ||||||||||||||
| Noninterest expense | ||||||||||||||||||||||||||||
| Salaries and employee benefits | $ | 9,273 | $ | 8,983 | $ | 8,993 | $ | 9,441 | $ | 9,003 | $ | 36,690 | $ | 35,774 | ||||||||||||||
| Occupancy expense | 1,134 | 1,075 | 1,083 | 1,250 | 1,104 | 4,542 | 4,775 | |||||||||||||||||||||
| Furniture and equipment expense | 1,004 | 985 | 945 | 1,046 | 1,114 | 3,980 | 4,425 | |||||||||||||||||||||
| Service fees | 1,047 | 1,134 | 851 | 828 | 703 | 3,860 | 3,348 | |||||||||||||||||||||
| Advertising and public relations | 550 | 478 | 461 | 522 | 506 | 2,011 | 2,206 | |||||||||||||||||||||
| Professional fees | 356 | 337 | 430 | 307 | 589 | 1,430 | 2,567 | |||||||||||||||||||||
| Amortization of intangibles | 254 | 261 | 263 | 261 | 266 | 1,039 | 1,056 | |||||||||||||||||||||
| FDIC premiums and assessments | 209 | 234 | 252 | 211 | 212 | 906 | 910 | |||||||||||||||||||||
| Loss on extinguishment of debt | – | 1,096 | – | – | – | 1,096 | – | |||||||||||||||||||||
| Goodwill impairment | – | 1,492 | – | – | – | 1,492 | – | |||||||||||||||||||||
| Other operating expense | 3,539 | 2,056 | 3,882 | 3,250 | 3,186 | 12,727 | 11,841 | |||||||||||||||||||||
| Total noninterest expense | $ | 17,366 | $ | 18,131 | $ | 17,160 | $ | 17,116 | $ | 16,683 | $ | 69,773 | $ | 66,902 | ||||||||||||||
| CONDENSED CONSOLIDATED QUARTERLY BALANCE SHEETS (Unaudited) | ||||||||||||||||||||
| December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
| (Amounts in thousands, except per share data) | 2018 | 2018 | 2018 | 2018 | 2017 | |||||||||||||||
| Assets | ||||||||||||||||||||
| Cash and cash equivalents | $ | 76,873 | $ | 73,679 | $ | 107,957 | $ | 205,140 | $ | 157,951 | ||||||||||
| Debt securities available for sale | 153,116 | 163,593 | 196,425 | 164,192 | 165,580 | |||||||||||||||
| Debt securities held to maturity | 25,013 | 25,047 | 25,082 | 25,115 | 25,149 | |||||||||||||||
| Loans held for investment, net of unearned income | ||||||||||||||||||||
| Noncovered | 1,756,269 | 1,770,426 | 1,776,112 | 1,767,703 | 1,789,236 | |||||||||||||||
| Covered | 18,815 | 20,483 | 22,919 | 25,406 | 27,948 | |||||||||||||||
| Allowance for loan losses | (18,267 | ) | (18,256 | ) | (19,583 | ) | (19,500 | ) | (19,276 | ) | ||||||||||
| Loans held for investment, net | 1,756,817 | 1,772,653 | 1,779,448 | 1,773,609 | 1,797,908 | |||||||||||||||
| FDIC indemnification asset | 5,108 | 5,653 | 6,390 | 6,884 | 7,161 | |||||||||||||||
| Premises and equipment, net | 45,785 | 45,537 | 45,547 | 46,415 | 48,126 | |||||||||||||||
| Other real estate owned, noncovered | 3,806 | 4,754 | 4,805 | 4,620 | 2,409 | |||||||||||||||
| Other real estate owned, covered | 32 | 44 | 44 | 70 | 105 | |||||||||||||||
| Interest receivable | 5,481 | 5,374 | 5,580 | 5,155 | 5,778 | |||||||||||||||
| Goodwill | 92,744 | 94,287 | 95,779 | 95,779 | 95,779 | |||||||||||||||
| Other intangible assets | 5,026 | 5,366 | 5,628 | 5,891 | 6,151 | |||||||||||||||
| Other assets | 74,573 | 73,701 | 75,435 | 95,437 | 76,363 | |||||||||||||||
| Total assets | $ | 2,244,374 | $ | 2,269,688 | $ | 2,348,120 | $ | 2,428,307 | $ | 2,388,460 | ||||||||||
| Liabilities | ||||||||||||||||||||
| Deposits | ||||||||||||||||||||
| Noninterest-bearing | $ | 459,550 | $ | 463,945 | $ | 462,851 | $ | 460,478 | $ | 454,143 | ||||||||||
| Interest-bearing | 1,396,200 | 1,411,906 | 1,441,887 | 1,520,141 | 1,475,748 | |||||||||||||||
| Total deposits | 1,855,750 | 1,875,851 | 1,904,738 | 1,980,619 | 1,929,891 | |||||||||||||||
| Securities sold under agreements to repurchase | 29,370 | 30,151 | 27,869 | 29,115 | 30,086 | |||||||||||||||
| FHLB borrowings | – | – | 50,000 | 50,000 | 50,000 | |||||||||||||||
| Interest, taxes, and other liabilities | 26,397 | 25,284 | 26,392 | 26,536 | 27,769 | |||||||||||||||
| Total liabilities | 1,911,517 | 1,931,286 | 2,008,999 | 2,086,270 | 2,037,746 | |||||||||||||||
| Stockholders’ equity | ||||||||||||||||||||
| Common stock(2) | 16,007 | 21,382 | 21,382 | 21,382 | 21,382 | |||||||||||||||
| Additional paid-in capital(2) | 122,486 | 229,182 | 228,949 | 228,774 | 228,750 | |||||||||||||||
| Retained earnings | 195,793 | 189,902 | 184,279 | 178,227 | 180,543 | |||||||||||||||
| Treasury stock, at cost(2) | – | (99,247 | ) | (92,904 | ) | (83,865 | ) | (79,121 | ) | |||||||||||
| Accumulated other comprehensive loss | (1,429 | ) | (2,817 | ) | (2,585 | ) | (2,481 | ) | (840 | ) | ||||||||||
| Total stockholders’ equity | 332,857 | 338,402 | 339,121 | 342,037 | 350,714 | |||||||||||||||
| Total liabilities and stockholders’ equity | $ | 2,244,374 | $ | 2,269,688 | $ | 2,348,120 | $ | 2,428,307 | $ | 2,388,460 | ||||||||||
| Shares outstanding at period-end | 16,007,263 | 16,390,502 | 16,574,347 | 16,847,452 | 16,998,226 | |||||||||||||||
| Book value per common share | $ | 20.79 | $ | 20.65 | $ | 20.46 | $ | 20.30 | $ | 20.63 | ||||||||||
| Tangible book value per common share(1) | 14.69 | 14.57 | 14.34 | 14.27 | 14.64 | |||||||||||||||
| (1) | A non-GAAP financial measure defined as stockholders’ equity less goodwill and other intangible assets, divided by shares outstanding | |||||||||||||||||||
| (2) | In accordance with the Company’s reincorporation from Nevada to Virginia on October 2, 2018, treasury stock is not recognized. | |||||||||||||||||||
| SELECTED CREDIT QUALITY INFORMATION (Unaudited) | |||||||||||||||||||
| December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||||||
| (Amounts in thousands) | 2018 | 2018 | 2018 | 2018 | 2017 | ||||||||||||||
| Allowance for Loan Losses | |||||||||||||||||||
| Beginning balance | $ | 18,256 | $ | 19,583 | $ | 19,500 | $ | 19,276 | $ | 19,206 | |||||||||
| Provision for loan losses charged to operations | 908 | 495 | 495 | 495 | 615 | ||||||||||||||
| Charge-offs | (1,282 | ) | (2,177 | ) | (750 | ) | (698 | ) | (967 | ) | |||||||||
| Recoveries | 385 | 355 | 338 | 427 | 422 | ||||||||||||||
| Net charge-offs | (897 | ) | (1,822 | ) | (412 | ) | (271 | ) | (545 | ) | |||||||||
| Ending balance | $ | 18,267 | $ | 18,256 | $ | 19,583 | $ | 19,500 | $ | 19,276 | |||||||||
| Nonperforming Assets | |||||||||||||||||||
| Non-covered nonperforming assets | |||||||||||||||||||
| Nonaccrual loans | $ | 19,583 | $ | 20,542 | $ | 21,467 | $ | 21,650 | $ | 18,997 | |||||||||
| Accruing loans past due 90 days or more | 58 | 46 | – | 27 | 1 | ||||||||||||||
| Troubled debt restructurings (“TDRs”)(1) | 161 | 189 | 133 | 77 | 120 | ||||||||||||||
| Total non-covered nonperforming loans | 19,802 | 20,777 | 21,600 | 21,754 | 19,118 | ||||||||||||||
| OREO | 3,806 | 4,754 | 4,805 | 4,620 | 2,409 | ||||||||||||||
| Total non-covered nonperforming assets | $ | 23,608 | $ | 25,531 | $ | 26,405 | $ | 26,374 | $ | 21,527 | |||||||||
| Covered nonperforming assets | |||||||||||||||||||
| Nonaccrual loans | $ | 322 | $ | 330 | $ | 509 | $ | 596 | $ | 342 | |||||||||
| Total covered nonperforming loans | 322 | 330 | 509 | 596 | 342 | ||||||||||||||
| OREO | 32 | 44 | 44 | 70 | 105 | ||||||||||||||
| Total covered nonperforming assets | $ | 354 | $ | 374 | $ | 553 | $ | 666 | $ | 447 | |||||||||
| Additional Information | |||||||||||||||||||
| Performing TDRs(2) | $ | 6,266 | $ | 6,953 | $ | 6,847 | $ | 7,220 | $ | 7,614 | |||||||||
| Total TDRs(3) | 6,427 | 7,142 | 6,980 | 7,297 | 7,734 | ||||||||||||||
| Non-covered ratios | |||||||||||||||||||
| Nonperforming loans to total loans | 1.13 | % | 1.17 | % | 1.22 | % | 1.23 | % | 1.07 | % | |||||||||
| Nonperforming assets to total assets | 1.06 | % | 1.14 | % | 1.14 | % | 1.10 | % | 0.91 | % | |||||||||
| Non-PCI allowance to nonperforming loans | 92.25 | % | 87.87 | % | 90.66 | % | 89.64 | % | 100.83 | % | |||||||||
| Non-PCI allowance to total loans | 1.04 | % | 1.03 | % | 1.10 | % | 1.10 | % | 1.08 | % | |||||||||
| Annualized net charge-offs to average loans | 0.20 | % | 0.41 | % | 0.09 | % | 0.06 | % | 0.12 | % | |||||||||
| Total ratios | |||||||||||||||||||
| Nonperforming loans to total loans | 1.13 | % | 1.18 | % | 1.23 | % | 1.25 | % | 1.07 | % | |||||||||
| Nonperforming assets to total assets | 1.07 | % | 1.14 | % | 1.15 | % | 1.11 | % | 0.92 | % | |||||||||
| Allowance for loan losses to nonperforming loans | 90.77 | % | 86.49 | % | 88.57 | % | 87.25 | % | 99.05 | % | |||||||||
| Allowance for loan losses to total loans | 1.03 | % | 1.02 | % | 1.09 | % | 1.09 | % | 1.06 | % | |||||||||
| Annualized net charge-offs to average loans | 0.20 | % | 0.40 | % | 0.09 | % | 0.06 | % | 0.12 | % | |||||||||
| (1) Accruing TDRs restructured within the past six months or nonperforming | |||||||||||||||||||
| (2) Accruing TDRs with six months or more of satisfactory payment performance | |||||||||||||||||||
| (3) Accruing total TDRs | |||||||||||||||||||
| FOR MORE INFORMATION, CONTACT: |
| David D. Brown |
| (276) 326-9000 |
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