POMPANO BEACH, FL--(Marketwired - Apr 28, 2017) - Stonegate Bank (
Net operating income is a non-GAAP financial measurement used by management to evaluate and monitor financial results of operations and excludes certain activities or transactions, such as merger and acquisition related expenses. Information related to our use of non-GAAP financial measures and a table reconciling GAAP to non-GAAP measures used in this press release are under the caption Non-GAAP Financial Measures - Reconciliation of GAAP to non-GAAP Measures .
Key highlights for the first quarter:
- Home BancShares Merger: Announced the signing of a definitive agreement with Home BancShares, Inc. and its wholly-owned bank subsidiary, Centennial Bank, an Arkansas state bank, under which Home BancShares, Inc. and Centennial Bank will acquire Stonegate. The agreement provides that Stonegate will merge with and into Centennial Bank. This transaction is expected to close in the fourth quarter of 2017.
- Insignia Bank Acquisition: Closed on the acquisition of Insignia Bank ("Insignia") on March 7, 2017, making Stonegate the largest community bank by deposit market share in Sarasota County. At acquisition, Insignia had $190.5 million in loans and $204.1 million in deposits, before any fair value adjustments.
- Loans: Total loans, net of discounts and deferred fees, increased $206.0 million during the first quarter of 2017 to $2.5 billion at March 31, 2017, a result of loans acquired through the Insignia acquisition and $20.4 million of net organic loan growth during the quarter. Payoffs again were above normal at approximately $67.2 million for the quarter. Based upon the outstanding balance as of March 31, 2017, commercial real estate ("CRE") comprised 46% of new loan originations, residential loans accounted for 23% of the new originations, commercial and industrial ("C&I") accounted for 13% of the new loan originations, and construction accounted for 11% with the remaining balance primarily in other loans. The loan production for the first quarter was comprised of 68% variable rate loans. Approximately 62% of the variable rate loans originated in the first quarter were tied to LIBOR and 14% were tied to the prime rate.
- Asset Quality: Total loans past due, excluding nonaccrual loans, were $4.5 million at March 31, 2017, an increase of $4.1 million from December 31, 2016. Nonaccrual loans were $9.1 million at March 31, 2017, or 0.37% of total loans, an increase from $8.6 million at December 31, 2016, or 0.38% of total loans. Other real estate owned was $4.2 million at March 31, 2017, an increase of $1.4 million from December 31, 2016. The increase in OREO was a result of the Insignia acquisition. See Credit Quality and Allowance for Loan Losses for a detailed analysis of past due and nonaccrual loans.
- Net Interest Income and Margin: Net interest income, on a tax-equivalent basis, totaled $26.3 million for the three months ended March 31, 2017, and represented a decrease of $809,000 when compared to the three months ended December 31, 2016. The net interest margin, on a tax-equivalent basis, decreased to 3.91% for the first quarter of 2017 as compared to 4.01% for the fourth quarter of 2016 and a decrease over the tax-equivalent net interest margin of 3.92% for the quarter ended March 31, 2016. The decrease in the margin from the fourth quarter of 2016 to the first quarter of 2017 was primarily a result of greater nonaccretable discounts recognized during the fourth quarter 2016, higher liquidity in the form of deposits with interest at other banks and an increase in the yield on total interest- bearing liabilities.
- Noninterest Expense: Noninterest expense decreased to $15.1 million for the three months ended March 31, 2017 from $16.9 million for the three months ended December 31, 2016. The decrease in expenses was primarily a result of expenses in the fourth quarter of 2016 associated with the Regent Bank and Insignia acquisitions.
- Capital: Stonegate remained well-capitalized as of March 31, 2017 with capital of $410.1 million as compared to $355.1 million at December 31, 2016. As of March 31, 2017, Stonegate's total risk-based capital ratio was 12.3%; Stonegate's Tier 1 risk-based and Common Equity Tier 1 capital ratios were each 11.3%; and Stonegate's leverage capital ratio was 10.0%.
Loans and Deposits
Loans outstanding at March 31, 2017 were $2.48 billion as compared to $2.27 billion at December 31, 2016, an increase of $206.0 million during the first quarter of 2017. Loans outstanding that were acquired through Stonegate's acquisition of Insignia were $185.6 million at March 31, 2017.
The loan portfolio consists primarily of loans to individuals and small- and medium-sized businesses within Stonegate's primary market areas of South and West Florida. The table below shows the loan portfolio composition:
| (in thousands of dollars) | March 31, 2017 | December 31, 2016 | ||||
| Commercial | $ | 322,453 | $ | 307,729 | ||
| Commercial real estate - owner occupied | 549,740 | 518,642 | ||||
| Commercial real estate - other | 779,116 | 706,404 | ||||
| Construction and land development | 264,040 | 261,006 | ||||
| Residential real estate | 457,933 | 384,733 | ||||
| Consumer and other loans | 117,954 | 107,089 | ||||
| Credit Cards | 1,151 | 759 | ||||
| Total loans | 2,492,387 | 2,286,362 | ||||
| Less: discount on loans acquired | 8,216 | 8,018 | ||||
| Less: net deferred fees | 3,233 | 3,408 | ||||
| Recorded investment in loans | 2,480,938 | 2,274,936 | ||||
| Less: Allowance for loan losses | 19,538 | 18,888 | ||||
| Net loans | $ | 2,461,400 | $ | 2,256,048 | ||
New loan originations were $122.5 million during the first quarter of 2017, with fundings of $92.7 million. As of March 31, 2017, outstanding commitments were approximately $449.7 million with approximately $58.4 million representing new approved loan originations, approximately $123.8 million in unfunded construction commitments and approximately $17.1 in unfunded credit card lines.
Total deposits increased to $2.72 billion at March 31, 2017 from $2.45 billion at December 31, 2016, primarily as a result of approximately $207.8 million of deposits acquired in connection with the Insignia acquisition. Noninterest-bearing deposits were $628.5 million at March 31, 2017, an increase from $506.8 million at December 31, 2016, and represented approximately 23.1% of Stonegate's total deposits.
The following table shows the composition of deposits as of March 31, 2017 and December 31, 2016:
| (in thousands of dollars) | March 31, 2017 | December 31, 2016 | ||||
| Noninterest bearing | $ | 628,497 | $ | 506,795 | ||
| NOW | 338,461 | 332,843 | ||||
| Money market | 1,401,763 | 1,309,049 | ||||
| Savings | 137,065 | 125,186 | ||||
| Certificates of deposit | 215,153 | 173,953 | ||||
| Total deposits | $ | 2,720,939 | $ | 2,447,826 | ||
Credit Quality and Allowance for Loan Losses
Loans past due 30-89 days were $4.4 million at March 31, 2017, an increase from $387,000 at December 31, 2016. The increase in loans past due was primarily attributable to two loans, for a total of $2.6 million, acquired from Florida Shores Bank - Southwest, and another loan for $748,000 acquired from Regent Bank. Past dues acquired in the Insignia acquisition totaled $50,000 at March 31, 2017. There were no loans past due 90 days or more and still accruing at March 31, 2017. Legacy loans (i.e., loans made by Stonegate and not acquired through acquisition) past due at March 31, 2017 totaled $587,000 and $0 at December 31, 2016. Nonaccrual loans were $9.1 million at March 31, 2017, an increase from $8.6 million at December 31, 2016. This increase was due primarily to $770,000 of new loans that were changed to nonaccrual status during the first quarter, offset by one nonaccrual loan for $140,000 which was paid off and one loan for $100,000 which was transferred to OREO. Legacy nonaccrual loans were approximately $2.8 million at March 31, 2017 versus $2.6 million as of December 31, 2016. Residential loans classified as nonaccrual were $3.2 million, or 35.4% of the nonaccrual loans, and commercial real estate loans classified as nonaccrual were $1.3 million, or 14.7% of the nonaccrual loans, as of March 31, 2017. At March 31, 2017, there remained approximately $14.9 million in nonaccretable discounts on loans previously acquired, of which $1.0 million was associated with the loans acquired in the Insignia acquisition. None of the acquired loans are subject to a loss share arrangement with the Federal Deposit Insurance Corporation. The following table outlines Stonegate's past due and nonaccrual loans at March 31, 2017:
| (dollars in thousands) | Legacy Bank | Insignia Bank | Regent Bank | Other Acquired Banks | Total | |||||||||
| Past due 30-89 days | $ | 587 | $ | 50 | $ | 748 | $ | 2,967 | $ | 4,352 | ||||
| Past due 90 + days | - | - | - | - | - | |||||||||
| Nonaccrual | 2,847 | - | 3,893 | 2,319 | 9,059 | |||||||||
| Total | $ | 3,434 | $ | 50 | $ | 4,641 | $ | 5,286 | $ | 13,411 | ||||
Nonperforming assets (nonaccrual loans and other real estate owned) were $13.3 million as of March 31, 2017, an increase of $1.9 million from December 31, 2016. Other real estate owned ("OREO") increased to $4.2 million as of March 31, 2017 as compared to $2.8 million as of December 31, 2016. The increase of $1.4 million in OREO from December 31, 2016 consisted primarily of $1.9 million acquired in the Insignia acquisition, partially offset by the sale of one single-family residence.
The following table outlines nonperforming assets for the periods ended:
| (in thousands of dollars) | March 31, 2017 | December 31, 2016 | ||||||
| Nonaccrual | $ | 9,059 | $ | 8,556 | ||||
| Other real estate owned | 4,222 | 2,792 | ||||||
| Total nonperforming assets | $ | 13,281 | $ | 11,348 | ||||
| Nonperforming loans as a percentage of total loans | 0.37 | % | 0.38 | % | ||||
| Nonperforming assets as a percentage of total assets | 0.41 | % | 0.39 | % | ||||
Loans modified as troubled debt restructuring were $9.4 million and $9.5 million at March 31, 2017 and December 31, 2016, respectively. There were no loans modified as troubled debt restructuring during the first quarter of 2017. Specific reserves allocated to loans modified as troubled debt restructuring increased to $161,000 at March 31, 2017, from $140,000 at December 31, 2016.
At March 31, 2017, the allowance for loan losses was $19.5 million, an increase of $650,000 from December 31, 2016. During the first quarter of 2017, recoveries totaled $169,000, charge-offs were $119,000 and we added provision expense of $600,000. The provision expense added for the first quarter was due to an increase in specific reserves and to the continued layering in of the acquired loan portfolios. Specific reserves increased to $820,000 at March 31, 2017 from $725,000 at December 31, 2016. The allowance for loan losses represented 0.79% of total loans as of March 31, 2017 and 0.83% of total loans as of December 31, 2016.
The following table shows the activity in the allowance for loan losses for the quarters ended:
| (in thousands of dollars) | March 31, 2017 | December 31, 2016 | |||||
| Balance at beginning of period | $ | 18,888 | $ | 18,749 | |||
| Charge-offs | (119 | ) | (102 | ) | |||
| Recoveries | 169 | 241 | |||||
| Provision for loan losses | 600 | - | |||||
| Balance at end of period | $ | 19,538 | $ | 18,888 | |||
The table below reflects the allowance allocation per loan category and percent of loans in each category to total loans for the periods indicated:
| (in thousands of dollars) | March 31, 2017 | December 31, 2016 | ||||||||
| Amount | % | Amount | % | |||||||
| Commercial | $ | 2,946 | 15.1 | $ | 2,757 | 14.6 | ||||
| Commercial real estate | 11,742 | 60.1 | 11,382 | 60.3 | ||||||
| Construction and land development | 1,913 | 9.8 | 2,024 | 10.7 | ||||||
| Residential real estate | 2,491 | 12.7 | 2,273 | 12.0 | ||||||
| Consumer and other loans | 446 | 2.3 | 452 | 2.4 | ||||||
| Total | $ | 19,538 | 100.0 | $ | 18,888 | 100.0 | ||||
The following is a summary of information pertaining to impaired loans for the three months ended on the date indicated:
| (in thousands of dollars) | March 31, 2017 | December 31, 2016 | March 31, 2016 | |||||
| Impaired loans without a valuation allowance | $ | 7,986 | $ | 9,091 | $ | 6,869 | ||
| Impaired loans with a valuation allowance | 7,976 | 6,556 | 6,489 | |||||
| Total impaired loans | $ | 15,962 | $ | 15,647 | $ | 13,358 | ||
| Valuation allowance related to impaired loans | $ | 820 | $ | 725 | $ | 744 | ||
Net Interest Income and Margin
On a tax-equivalent basis, Stonegate's net interest income for the three months ended March 31, 2017 was $26.3 million, a decrease of approximately $809,000 from the fourth quarter of 2016 and an increase of $5.2 million from the first quarter of 2016. Average earning assets grew $36.3 million from the fourth quarter of 2016 to the first quarter of 2017, primarily a result of a $25.2 million increase in loans, and a $12.4 million increase in Stonegate's interest-earning deposits with other banks. The yield on loans decreased from 5.10% for the fourth quarter of 2016 to 5.00% for the first quarter of 2017, and was slightly higher than the 4.89% yield for the first quarter of 2016. The decrease in the loan yield from the fourth quarter of 2016 to the first quarter of 2017 was primarily due to the increased level of accretable and nonaccretable discounts recognized in the fourth quarter of 2016. The loan yield for the first quarter of 2017 without nonaccretable discounts was 4.82% versus 4.87% in the fourth quarter of 2016. During the first quarter of 2017, discounts of approximately $840,000 were recognized on loans which were paid off during the quarter.
The net interest margin on a tax-equivalent basis decreased from 4.01% for the fourth quarter of 2016 to 3.91% for the first quarter of 2017. The net interest margin was 3.92% for the first quarter of 2016. The average yield on total earning assets was 4.43% for the first quarter of 2017, a decrease of six basis points from the fourth quarter of 2016. The increase in the average balances of deposits held at other banks increased in the first quarter of 2017 as compared to the fourth quarter of 2016 by $12.4 million and by $94.4 million from the first quarter of 2016. This increase in a lower yielding asset has also attributed to the decline in the yield on earning assets and the net interest margin. The average yield on interest-bearing liabilities was 0.69% for the three months ended March 31, 2017 versus 0.64% for the three months ended December 31, 2016. The yield on time deposits increased seven basis points for the three months ended March 31, 2017 as compared to the three months ended December 31, 2016. This increase was largely due to the Insignia acquisitions as Insignia's time deposits had an average yield of 1.03% since March 7, 2017, the date of acquisition. Stonegate's cost of funds has increased from 0.46% for the March 2016 month-to-date average to 0.55% for the March 2017 month-to-date average.
The following table recaps yields and costs by various interest-earning asset and interest-bearing liability account types for the current quarter, the previous quarter and the same quarter last year.
| Yield and cost table (unaudited) | |||||||||||||||||||||||||||
| (in thousands of dollars) | |||||||||||||||||||||||||||
| 1st Quarter 2017 | 4th Quarter 2016 | 1st Quarter 2016 | |||||||||||||||||||||||||
| Average Balance | Interest | Rate | Average Balance | Interest | Rate | Average Balance | Interest | Rate | |||||||||||||||||||
| ASSETS | |||||||||||||||||||||||||||
| Loans, Net (1)(2)(4) | $ | 2,323,727 | $ | 28,648 | 5.00 | % | $ | 2,298,487 | $ | 29,493 | 5.10 | % | $ | 1,870,153 | $ | 22,729 | 4.89 | % | |||||||||
| Investment Securities | 117,985 | 483 | 1.66 | 117,740 | 462 | 1.56 | 108,691 | 449 | 1.66 | ||||||||||||||||||
| Federal Funds Sold | 30,000 | 68 | 0.92 | 31,793 | 56 | 0.70 | 30,000 | 54 | 0.72 | ||||||||||||||||||
| Other Investments (3) | 4,068 | 46 | 4.59 | 3,831 | 41 | 4.26 | 2,912 | 34 | 4.70 | ||||||||||||||||||
| Deposits with interest at banks | 248,528 | 531 | 0.87 | 236,139 | 311 | 0.52 | 154,087 | 221 | 0.58 | ||||||||||||||||||
| Total Earning Assets | 2,724,308 | 29,776 | 4.43 | % | 2,687,990 | 30,363 | 4.49 | % | 2,165,843 | 23,487 | 4.36 | % | |||||||||||||||
| LIABILITIES | |||||||||||||||||||||||||||
| Savings, NOW and Money Market | $ | 1,795,495 | $ | 2,823 | 0.64 | % | $ | 1,773,901 | $ | 2,649 | 0.59 | % | $ | 1,479,261 | $ | 1.969 | 0.54 | % | |||||||||
| Time Deposits | 183,091 | 263 | 0.58 | 179,820 | 232 | 0.51 | 161,401 | 215 | 0.54 | ||||||||||||||||||
| Total Interest Bearing Deposits | 1,978,586 | 3,086 | 0.63 | 1,953,721 | 2,881 | 0.59 | 1,640,662 | 2.184 | 0.54 | ||||||||||||||||||
| Other Borrowings | 81,115 | 408 | 2.04 | 70,192 | 392 | 2.22 | 58,801 | 217 | 1.48 | ||||||||||||||||||
| Total Interest Bearing Liabilities | 2,059,701 | 3,494 | 0.69 | % | 2,023,913 | 3,273 | 0.64 | % | 1,699,463 | 2,401 | 0.57 | % | |||||||||||||||
| Net interest spread (tax equivalent basis) (4) | 3.74 | % | 3.85 | % | 3.79 | % | |||||||||||||||||||||
| Net interest margin (tax equivalent basis) (5) | 3.91 | % | 4.01 | % | 3.92 | % | |||||||||||||||||||||
| (1) | Average balances include nonaccrual loans, and are net of unearned loan fees of $3,233, $3,408 and $3,005 for 1 st quarter 2017, 4 th quarter 2016, and 1 st quarter 2016, respectively. |
| (2) | Interest income includes fees on loans of $60, $79 and $47 for 1 st quarter 2017, 4 th quarter 2016, and 1 st quarter 2016, respectively. |
| (3) | "Other investments" consists of equity stock in the Federal Home Loan Bank of Atlanta ("FHLB") that Stonegate is required to own based on its transactions with the FHLB. |
| (4) | Interest income and rates include the effects of a tax equivalent adjustment using applicable statutory tax rates to adjust tax exempt interest income on tax exempt loans to a fully taxable basis. |
| (5) | Represents net interest income divided by total interest-earning assets. |
Noninterest Income
Noninterest income of $2.1 million for the first quarter of 2017 decreased from $2.5 million for the quarter ended December 31, 2016. The decrease in noninterest income was primarily driven by higher gains on the sale of OREO of approximately $310,000 during the fourth quarter of 2016. Additionally, we did not receive any fees from interest rate swaps during the first quarter of 2017 versus $86,000 in the fourth quarter of 2016.
Noninterest Expense
Noninterest expense for the three months ended March 31, 2017 decreased to $15.1 million from $16.9 million at December 31, 2016, and was greater than the $12.5 million for the three months ended March 31, 2016. The decrease in noninterest expense was primarily related to expenses incurred in the fourth quarter with the Regent Bank and Insignia acquisitions.
Salaries and employee benefits decreased to $8.4 million for the first quarter of 2017 versus $9.1 million for the fourth quarter of 2016. This compares with $7.1 million for the three months ended March 31, 2016. The decrease in salaries and employee benefits in the first quarter of 2017 from the fourth quarter of 2016 were payments made in the fourth quarter for the Regent Bank conversion and a decrease in the incentive accrual.
Occupancy and equipment expenses decreased $234,000 to $2.3 million for the three months ended March 31, 2017 versus $2.5 million for the three months ended December 31, 2016. The decrease was primarily due to a reduction in depreciation expense in the first quarter of 2017. Occupancy and equipment expenses were $2.1 million for the three months ended March 31, 2016. Expenses for merger-related branch closures in the fourth quarter of 2016 were approximately $48,000.
Data processing expenses decreased $1.2 million from $1.7 million for the fourth quarter of 2016 to $478,000 for the quarter ended March 31, 2017. Approximately $1.0 million of data processing expenses in the fourth quarter were related to the Regent Bank data conversion. Additionally during the fourth quarter, approximately $109,000 of the $1.7 million were expenses associated with Regent Bank's data processing prior to conversion. Data processing expenses associated with the Insignia acquisition were very minimal in the first three months of 2017. Professional fees increased for the three months ended March 31, 2017. During the first quarter of 2017, professional fees total $1.4 million versus $782,000 in the fourth quarter of 2016 and $604,000 for the three months ended March 31, 2016. During the first quarter of 2017, legal and other professional fees for merger-related expenses were $583,000 as compared to $43,000 in the fourth quarter of 2016.
The table below outlines the expenses for the quarters ended:
| (in thousands of dollars) | March 31, 2017 | December 31, 2016 | March 31, 2016 | ||||||
| Salaries and employee benefits | $ | 8,411 | $ | 9,135 | $ | 7,097 | |||
| Occupancy and equipment expense | 2,264 | 2,498 | 2,113 | ||||||
| FDIC insurance and state assessments | 398 | 396 | 383 | ||||||
| Data processing | 478 | 1,669 | 452 | ||||||
| Loan and other real estate expense | 201 | 277 | 154 | ||||||
| Professional fees | 1,352 | 782 | 604 | ||||||
| Core deposit intangible amortization | 463 | 489 | 414 | ||||||
| Other operating expenses | 1,551 | 1,681 | 1,319 | ||||||
| Totals | $ | 15,118 | $ | 16,927 | $ | 12,536 | |||
Looking forward to the second quarter of 2017, Stonegate anticipates additional costs associated with the Insignia data conversion and professional fees associated with the pending merger with Home Bancshares, Inc. and Centennial Bank.
About Stonegate Bank
Stonegate Bank is a full-service commercial bank, providing a wide range of business and consumer financial products and services through its 25 banking offices in its target marketplaces of South and West Florida, which are comprised primarily of Broward, Charlotte, Collier, Hillsborough, Lee, Miami-Dade, Palm Beach and Sarasota Counties in Florida. Stonegate's principal executive office and mailing address is 400 North Federal Highway, Pompano Beach, Florida 33062 and its telephone number is (954) 315-5500.
There will not be a conference call held this quarter to discuss the first quarter results.
Forward-Looking Statements
Any non-historical statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current plans and expectations that are subject to uncertainties and risks, which could cause our future results to differ materially. The following factors, among others, could cause our actual results to differ: the strength of the United States economy in general and the strength of the local economies in which we conduct operations; our need and ability to incur additional debt or equity financing; our ability to execute our growth strategy through expansion; our ability to comply with the extensive laws and regulations to which we are subject; changes in the securities and capital markets; changes in general market interest rates; legislative and regulatory changes; monetary and fiscal policies of the U.S. Treasury and the Federal Reserve; changes in the quality or composition of our loan portfolios; demand for loan products; changes in deposit flows, real estate values, and competition and other economic, competitive, and technological factors affecting our operations, pricing, products and services; and our ability to manage the risks involved in the foregoing. Additional factors can be found in our filings with the FDIC, which are available at the FDIC's internet site ( http://www2.fdic.gov/efr ). Forward-looking statements in this press release speak only s of the date of the press release and Stonegate Bank assumes no obligation to update any forward-looking statements or the reasons why actual results could differ.
| Stonegate Bank and Subsidiaries | ||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) | ||||||||||
| (in thousands of dollars, except per share data) | ||||||||||
| March 31, 2017 | December 31, 2016 | |||||||||
| Assets | ||||||||||
| Cash and due from banks | $ | 403,766 | $ | 305,803 | ||||||
| Federal funds sold | 30,000 | 30,000 | ||||||||
| Securities held to maturity (Fair value of $113,127 at March 31, 2017 and $116,719 at December 31, 2016) | 112,244 | 116,529 | ||||||||
| Other investments | 4,762 | 3,833 | ||||||||
| Loans, net of allowance for loan losses of $19,538 at March 31, 2017 and $18,888 at December 31, 2016 | 2,461,400 | 2,256,048 | ||||||||
| Premises and equipment, net | 43,383 | 38,510 | ||||||||
| Bank-owned life insurance | 47,444 | 44,011 | ||||||||
| Other real estate owned | 4,222 | 2,792 | ||||||||
| Other assets | 129,607 | 104,076 | ||||||||
| Total assets | $ | 3,236,828 | $ | 2,901,602 | ||||||
| Liabilities and Stockholders' Equity | ||||||||||
| Liabilities | ||||||||||
| Total deposits | $ | 2,720,939 | $ | 2,447,826 | ||||||
| Other borrowings | 81,566 | 71,448 | ||||||||
| Subordinated debentures | 8,230 | 8,175 | ||||||||
| Other liabilities | 16,029 | 19,040 | ||||||||
| Total liabilities | 2,826,764 | 2,546,489 | ||||||||
| Stockholders' Equity | ||||||||||
| Common stock, $5 par value, 20,000,000 shares authorized; 15,304,046 issued and 15,301,388 shares outstanding as of March 31, 2017 and 14,267,451 shares issued and 14,264,793 outstanding as of December 31, 2016 | 76,520 | 71,337 | ||||||||
| Additional paid-in capital | 229,881 | 186,948 | ||||||||
| Retained earnings | 104,584 | 97,814 | ||||||||
| Treasury Stock | (13 | ) | (13 | ) | ||||||
| Accumulated other comprehensive income (loss) | (908 | ) | (973 | ) | ||||||
| Total stockholders' equity | 410,064 | 355,113 | ||||||||
| Total liabilities and stockholders' equity | $ | 3,236,828 | $ | 2,901,602 | ||||||
| Stonegate Bank and Subsidiaries | |||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (unaudited) | |||||||||
| (in thousands of dollars, except per share data) | |||||||||
| March 31, 2017 | March 31, 2016 | ||||||||
| Interest income: | |||||||||
| Interest and fees on loans | $ | 28,253 | $ | 22,280 | |||||
| Interest on securities | 483 | 449 | |||||||
| Interest on federal funds sold and at other banks | 599 | 275 | |||||||
| Other interest | 46 | 34 | |||||||
| Total interest income | 29,381 | 23,038 | |||||||
| Interest expense: | |||||||||
| Interest on deposits | 3,086 | 2,184 | |||||||
| Other interest | 408 | 217 | |||||||
| Total interest expense | 3,494 | 2,401 | |||||||
| Net interest income | 25,887 | 20,637 | |||||||
| Provision for loan losses | 600 | 193 | |||||||
| Net interest income after provision for loan losses | 25,287 | 20,444 | |||||||
| Noninterest income: | |||||||||
| Service charges and fees on deposit accounts | 846 | 707 | |||||||
| Other noninterest income | 1,231 | 1,577 | |||||||
| Total noninterest income | 2,077 | 2,284 | |||||||
| Noninterest expense: | |||||||||
| Salaries and employee benefits | 8,411 | 7,097 | |||||||
| Occupancy and equipment expenses | 2,264 | 2,113 | |||||||
| Data processing | 478 | 452 | |||||||
| Professional fees | 1,352 | 604 | |||||||
| Core deposit intangible amortization | 463 | 414 | |||||||
| Other operating expenses | 2,150 | 1,856 | |||||||
| Total noninterest expense | 15,118 | 12,536 | |||||||
| Income before income taxes | 12,246 | 10,192 | |||||||
| Income tax | 4,252 | 3,298 | |||||||
| Net income applicable to common stock | $ | 7,994 | $ | 6,894 | |||||
| Earnings per common share: | |||||||||
| Basic | $ | 0.55 | $ | 0.54 | |||||
| Diluted | 0.53 | 0.52 | |||||||
| Average common shares used in the calculation of earnings per share: | |||||||||
| Basic | 14,558,233 | 12,775,344 | |||||||
| Diluted | 15,090,775 | 13,164,346 | |||||||
| Stonegate Bank and Subsidiaries | |||||||||||
| CONDENSED FINANCIAL HIGHLIGHTS | |||||||||||
| (in thousands of dollars) | |||||||||||
| As of | |||||||||||
| March 31, 2017 | December 31, 2016 | March 31, 2016 | |||||||||
| BALANCE SHEET ITEMS: | |||||||||||
| Assets | $ | 3,236,828 | $ | 2,901,602 | $ | 2,454,715 | |||||
| Loans, net of allowance for loan losses | 2,461,400 | 2,256,048 | 1,867,652 | ||||||||
| Deposits | 2,720,939 | 2,447,826 | 2,089,600 | ||||||||
| Stockholders' equity | 410,064 | 355,113 | 289,520 | ||||||||
| CAPITAL RATIOS: | |||||||||||
| Total capital to risk weighted assets | 12.3 | % | 12.1 | % | 12.2 | % | |||||
| Tier 1 capital to risk weighted assets | 11.3 | 11.1 | 11.3 | ||||||||
| Common Equity Tier 1 to risk weighted assets | 11.3 | 11.1 | 11.3 | ||||||||
| Tier 1 capital to average assets | 10.0 | 10.0 | 10.2 | ||||||||
| BALANCE SHEET ITEMS QUARTERLY AVERAGE | |||||||||||
| Assets | $ | 2,995,584 | $ | 2,948,409 | $ | 2,393,187 | |||||
| Interest earning assets | 2,724,308 | 2,687,990 | 2,165,843 | ||||||||
| Loans, net of allowance for loan losses | 2,304,751 | 2,279,629 | 1,851,841 | ||||||||
| Interest bearing liabilities | 2,059,701 | 2,023,913 | 1,699,463 | ||||||||
| Deposits | 2,521,989 | 2,499,516 | 2,032,157 | ||||||||
| Stockholders' equity | 373,555 | 351,730 | 287,235 | ||||||||
| Stonegate Bank and Subsidiaries | |||||
| CONDENSED FINANCIAL HIGHLIGHTS | |||||
| (in thousands of dollars, except per share data) | |||||
| March 31, 2017 | March 31, 2016 | ||||
| FINANCIAL DATA: | |||||
| Net interest income | $ | 25,887 | $ | 20,637 | |
| Net interest income - tax equivalent | 26,282 | 21,086 | |||
| Noninterest income | 2,077 | 2,284 | |||
| Noninterest expense | 15,118 | 12,536 | |||
| Income tax | 4,252 | 3,298 | |||
| Net income attributed to common shares | 7,994 | 6,894 | |||
| Weighted average number of common shares outstanding: | |||||
| Basic | 14,558,233 | 12,775,344 | |||
| Diluted | 15,090,775 | 13,164,346 | |||
| Per common share data: | |||||
| Basic | $ | 0.55 | $ | 0.54 | |
| Diluted | 0.53 | 0.52 | |||
| Cash dividend declared to common shares | 1,224 | 1,023 | |||
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with GAAP. Stonegate's management uses these non-GAAP financial measures in their analysis of Stonegate's performance. These measures typically adjust GAAP performance measures to include the tax benefit associated with revenue items that are tax-exempt, as well as adjust income available to common shareholders for certain significant activities or transactions, such as merger-related expenses, that in management's opinion can distort period-to-period comparisons of Stonegate's performance. Since the presentation of these GAAP performance measures and their impact differ between companies, management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of Stonegate's core business. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of GAAP to non-GAAP disclosures in this press release are set forth below.
Reconciliation of GAAP to non-GAAP Measures (in thousands of dollars, except per share data)
| March 31, 2017 | December 31, 2016 | ||||
| Interest income, as reported (GAAP) | $ | 29,381 | $ | 29,917 | |
| Tax equivalents adjustments | 395 | 446 | |||
| Interest income (tax equivalent) | $ | 29,776 | $ | 30,363 | |
| Net interest income, as reported (GAAP) | $ | 25,886 | $ | 26,644 | |
| Tax equivalent adjustments | 395 | 446 | |||
| Net interest income (tax equivalent) | $ | 26,281 | $ | 27,090 | |
| Net income (GAAP) | 7,994 | 8,996 | |||
| Non-interest expense adjustments: | |||||
| Merger and acquisition related expenses | 16 | 1,719 | |||
| Professional expenses | 583 | 45 | |||
| Tax effect using the effective tax rate for the period presented | 208 | 645 | |||
| Cumulative effect of early adoption of ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting | - | 1,252 | |||
| Net operating income | $ | 8,385 | $ | 8,860 | |
| Net operating income per common share | $ | 0.58 | $ | 0.62 | |
INVESTOR RELATIONS : Dave Seleski Email Contact Stonegate Bank (954) 315-5510
