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8-K - FORM 8-K - SIMMONS FIRST NATIONAL CORPf8k_012413.htm
EXHIBIT 99.1
 
FOR IMMEDIATE RELEASE: January 24, 2013

SIMMONS FIRST ANNOUNCES 27% INCREASE IN FOURTH QUARTER EARNINGS

Pine Bluff, AR – Simmons First National Corporation (NASDAQ-GS: SFNC) today announced fourth quarter 2012 net income of $8.0 million, a 27.4% increase compared to $6.3 million for the same quarter in 2011. Diluted earnings per share were $0.48, an $0.11, or 29.8% increase over the same period in 2011. For the year ended December 31, 2012, net income was $27.7 million, or $1.64 diluted earnings per share, compared to $1.47 per share for 2011, an increase of $0.17, or 11.6%.

On October 19, 2012, the Company announced that its wholly-owned bank subsidiary, Simmons First National Bank, entered into a purchase and assumption agreement with loss share arrangements with the FDIC to purchase $180 million in assets and assume substantially all of the deposits and other liabilities of Excel Bank of Sedalia, Missouri. The Company recognized a pre-tax bargain purchase gain of $2.3 million on this transaction and incurred pre-tax merger related costs of $1.1 million. After taxes, the combined non-recurring items from the transactions contributed $735,000 to net income, or $0.04 to diluted earnings per share.

“There are many positives with our earnings announcement. Personally I believe the 27% net income growth is a major accomplishment. Even more significant is the way it was accomplished through the execution of our strategic plan, which resulted in the deployment of our excess capital in two strategic acquisitions, continued improvement in our asset quality numbers that were already strong and new initiatives that were introduced in all eight of our banks that resulted in good growth in our loan portfolios and customer relationships,” commented J. Thomas May, Chairman and CEO.

Loans

Total loans, including those acquired, were $1.9 billion at December 31, 2012, an increase of $184.3 million, or 10.6%, compared to the same period in 2011. Loans acquired in FDIC-assisted acquisitions grew $135.6 million, net of discounts, and legacy loans (excluding acquired loans) grew $48.7 million, or 3.1%. “This was the second consecutive quarter of organic loan growth.  While not enough to call a trend, we believe it is very positive in that the growth is coming throughout our markets in Arkansas, Kansas and Missouri. Needless to say, the economy remains in a slow recovery, which makes this growth even more significant,” added May.

Deposits

At December 31, 2012, total deposits were $2.9 billion, an increase of $224 million, or 8.4%, compared to the same period in 2011. Deposits acquired in the Excel acquisition were $117 million at quarter end. Total non-time deposits totaled $2.0 billion, or 70% of total deposits.

Net Interest Income

The Company’s net interest income for the fourth quarter of 2012 was $30.6 million, an increase of $3.3 million, or 12.1%, from the same period of 2011. Net interest margin was 3.99% for the quarter ended December 31, 2012. Included in interest income for the period is the additional yield accretion recognized as a result of updated estimates of the cash flows of the loan pools acquired in the Company’s 2010 FDIC-assisted transactions. Each quarter, the Company estimates the cash flows expected to be collected from the acquired loan pools, and adjustments may or may not be required. The cash flows estimate has increased based on payment histories and reduced loss expectations of the loan pools. This resulted in increased interest income that is spread on a level-yield basis over the remaining expected lives of the loan pools. The increases in expected cash flows also reduce the amount of expected reimbursements under the loss sharing agreements with the FDIC, which are recorded as indemnification assets. The impact of the adjustments on the Company’s financial results for the current reporting period is shown below:
 
   
Three Months Ended
   
Year Ended
 
(In thousands)
 
December 31, 2012
   
December 31, 2012
 
   
2012
   
2011
   
2012
   
2011
 
Impact on net interest income
  $ 2,647     $ 1,124     $ 11,751     $ 1,124  
Non-interest income
    (2,510 )     (978 )     (10,755 )     (978 )
                                 
Net impact to pre-tax income
  $ 137     $ 146     $ 997     $ 146  
 
Because these adjustments will be recognized over the remaining lives of the loan pools and the remainder of the loss sharing agreements, respectively, they will impact future periods as well. The current estimate of the remaining accretable yield adjustment that will positively impact interest income is $19.2 million and the remaining adjustment to the indemnification assets that will reduce non-interest income is $16.8 million. Of the remaining adjustments, we expect to recognize $9.6 million of interest income and a $9.1 million reduction of non-interest income, for a net addition to pre-tax income of approximately $540,000 during 2013. The accretable yield adjustments recorded in future periods will change as the Company continues to evaluate expected cash flows from the acquired loan pools.

Non-Interest Income

Non-interest income for the fourth quarter was $14.8 million, compared to $12.8 million for the fourth quarter of 2011. “There was a $1.5 million incremental decrease in non-interest income compared to the fourth quarter last year due to reductions of the indemnification assets resulting from increased cash flows expected to be collected from the FDIC covered loan portfolios,” reiterated May. “Excluding the indemnification asset adjustment and a non-recurring $2.3 million bargain purchase gain on the Excel Bank acquisition, non-interest income increased $1.1 million, or 8.9%.”

Non-Interest Expense

Non-interest expense for the fourth quarter of 2012 was $32.2 million, an increase of $3.7 million compared to the same period in 2011. “Included in the quarter were $1.1 million in merger related expenses and $2.4 million in normal operating expenses attributable to our FDIC-assisted acquisitions. Normalized for these acquisition related items, non-interest expense for the quarter increased by only 1%. Obviously, we continue to have good expense control as a result of the implementation of our efficiency initiatives,” added May.

Asset Quality

Beginning in 2010, the Company has acquired loans and foreclosed real estate (“OREO”) through FDIC-assisted acquisitions. Through the loss share provisions of the purchase and assumption agreements, the FDIC agreed to reimburse the Company for 80% of the losses incurred on the disposition of covered loans and OREO. The acquired loans and OREO and any related FDIC loss share indemnification asset were presented in the Company's financial reports with a carrying value equal to the discounted net present value of expected future proceeds. At December 31, 2012, acquired loans covered by loss share were carried at $211 million, OREO covered by loss share was carried at $28 million and the FDIC loss share indemnification asset was carried at $75 million. Acquired loans and OREO not covered by loss share were carried at $83 million and $12 million, respectively. As a result of  using the discounted net present value method of valuing these assets, and due to the significant protection against possible losses provided by the FDIC loss share indemnification, all acquired assets, with the exception of OREO not covered by loss share, are excluded from the computations of the asset quality ratios for the legacy loan portfolio, except for their inclusion in total assets.

The Company's allowance for loan losses was $27.9 million at December 31, 2012, or 1.71% of total loans and 232% of non-performing loans. Non-performing loans as a percent of total loans were 0.74% as of December 31, 2012 compared to 0.73% as of September 30, 2012. “Included in our non-performing assets was $11.8 million, net of a credit mark, of non-covered OREO we acquired in our two recent FDIC-assisted transactions. Normalizing for the acquired OREO, our legacy non-performing assets decreased $1.2 million for the previous quarter. Our legacy non-performing assets as a percent of total assets of 0.96% as of December 31, 2012 continues to compare favorably to the industry and our peer group,” commented May. For the fourth quarter, the annualized net charge-off ratio, excluding credit cards, was 0.24%, and the annualized credit card charge-off ratio was 1.54%.

Capital

At December 31, 2012, stockholders' equity was $406 million, book value per share was $24.55 and tangible book value per share was $20.66. The Company's ratio of stockholders' equity to total assets was 11.5% and its ratio of tangible common equity to tangible assets was 9.9%, as of December 31, 2012.

“Our exceptional level of capital puts us in the 82nd percentile of our peer group and allows us to actively pursue the right opportunities that meet our strategic plan regarding mergers and acquisitions,” continued May. As of December 31, 2012, the Company’s regulatory capital ratios remain significantly higher than regulatory “well capitalized” guidelines:
 
 
     “Well Capitalized”    
     SFNC    
Tier 1 Leverage Ratio
5.00%
10.81%
Tier 1 Risk-Based Capital Ratio
6.00%
19.08%
Total Risk-Based Capital Ratio
10.00%
20.34%
 
Stock Repurchase Program

During 2012, the Company repurchased approximately 726,000 shares at an average price of $24.24. The Company plans to continue to allocate its earnings, less dividends, to its stock repurchase program.

Simmons First National Corporation

Simmons First National Corporation is an eight bank financial holding company with community banks in Pine Bluff, Lake Village, Jonesboro, Rogers, Searcy, Russellville, El Dorado and Hot Springs, Arkansas. The Company’s eight banks conduct financial operations from 96 offices, of which 92 are financial centers, in 55 communities in Arkansas, Missouri and Kansas, including its recently acquired branches in Missouri. The Company’s common stock trades on the NASDAQ Global Select Market under the symbol “SFNC”.

Conference Call

Management will conduct a conference call to review this information beginning at 3:00 p.m. Central Time on Thursday, January 24, 2013. Interested persons can listen to this call by dialing 1-888-438-5524 (United States and Canada only) and asking for the Simmons First National Corporation conference call. A replay of the call will be available through 5:00 p.m. Central Time on January 30, 2013, by dialing 1-888-203-1112. The passcode for the replay is 1242917. In addition, the call will be available live or in recorded version on the Company’s website at www.simmonsfirst.com.


Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles (GAAP). The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance. These measures typically adjust GAAP performance measures to exclude the effects of the amortization of intangibles and 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 nonrecurring transactions. 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 the Company’s core businesses. 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.

Forward Looking Statements

Statements in this press release that are not historical facts should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements of this type speak only as of the date of this news release. By nature, forward-looking statements involve inherent risk and uncertainties. Various factors, including, but not limited to, economic conditions, credit quality, interest rates, loan demand and changes in the assumptions used in making the forward-looking statements, could cause actual results to differ materially from those contemplated by the forward-looking statements. Additional information on factors that might affect Simmons First National Corporation’s financial results is included in its Form 10-K filing with the Securities and Exchange Commission.

####

FOR MORE INFORMATION CONTACT:
DAVID W. GARNER
Senior Vice President and Investor Relations Officer
Simmons First National Corporation
(870) 541-1000

 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated End of Period Balance Sheets
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands)
                             
 ASSETS
                             
 Cash and non-interest bearing balances due from banks
  $ 47,470     $ 40,356     $ 29,708     $ 34,314     $ 35,087  
 Interest bearing balances due from banks
    467,984       440,524       515,874       642,929       535,119  
 Federal funds sold
    22,343       7,571       -       750       -  
     Cash and cash equivalents
    537,797       488,451       545,582       677,993       570,206  
 Investment securities - held-to-maturity
    496,141       510,630       525,522       481,314       525,444  
 Investment securities - available-for-sale
    191,342       205,051       166,966       176,466       172,212  
 Mortgage loans held for sale
    25,367       23,980       15,495       24,351       22,976  
 Assets held in trading accounts
    6,224       7,002       7,812       7,708       7,541  
 Loans:
                                       
 Not covered by FDIC loss share agreements
    1,628,513       1,623,401       1,614,736       1,543,653       1,579,769  
 Acquired, not covered by FDIC loss share agreements
                                       
 (net of discounts)
    82,764       73,023       -       -       -  
 Covered by FDIC loss share agreements (net of discounts)
    210,842       163,657       114,189       129,735       158,075  
 Allowance for loan losses
    (27,882 )     (28,145 )     (28,397 )     (28,325 )     (30,108 )
 Net loans
    1,894,237       1,831,936       1,700,528       1,645,063       1,707,736  
 FDIC indemnification asset
    75,286       59,547       35,038       39,978       47,683  
 Premises and equipment
    87,557       85,969       85,171       85,784       86,486  
 Foreclosed assets not covered by FDIC loss share agreements
    33,352       29,665       23,947       24,542       22,887  
 Foreclosed assets covered by FDIC loss share agreements
    27,620       26,466       11,252       11,705       11,685  
 Interest receivable
    14,530       15,253       12,975       13,319       15,126  
 Bank owned life insurance
    52,066       51,681       51,326       50,934       50,579  
 Goodwill
    60,605       60,605       60,605       60,605       60,605  
 Core deposit premiums
    3,760       2,549       1,431       1,505       1,579  
 Other assets
    21,605       16,195       13,494       18,786       17,384  
 Total assets
  $ 3,527,489     $ 3,414,980     $ 3,257,144     $ 3,320,053     $ 3,320,129  
                                         
 LIABILITIES AND STOCKHOLDERS' EQUITY
                                       
 Deposits:
                                       
 Non-interest bearing transaction accounts
  $ 576,655     $ 543,380     $ 517,854     $ 521,202     $ 532,259  
 Interest bearing transaction accounts and savings deposits
    1,421,137       1,343,784       1,290,954       1,282,763       1,239,504  
 Time deposits less than $100,000
    505,773       521,259       467,503       485,134       499,809  
 Time deposits greater than $100,000
    370,598       386,872       352,973       365,478       378,825  
         Total deposits
    2,874,163       2,795,295       2,629,284       2,654,577       2,650,397  
 Federal funds purchased and securities
                                       
 sold under agreements to repurchase
    104,078       64,829       70,220       106,224       114,766  
 Other borrowings
    89,441       88,852       90,866       90,312       90,170  
 Subordinated debentures
    20,620       20,620       30,930       30,930       30,930  
 Accrued interest and other liabilities
    33,125       41,136       28,431       28,698       25,955  
 Total liabilities
    3,121,427       3,010,732       2,849,731       2,910,741       2,912,218  
                                         
 Stockholders' equity:
                                       
 Common stock
    165       167       170       172       172  
 Surplus
    96,587       99,156       105,825       110,976       112,436  
 Undivided profits
    309,053       304,343       300,917       297,776       294,864  
 Accumulated other comprehensive income
                                       
 Unrealized appreciation on AFS securities
    257       582       501       388       439  
 Total stockholders' equity
    406,062       404,248       407,413       409,312       407,911  
 Total liabilities and stockholders' equity
  $ 3,527,489     $ 3,414,980     $ 3,257,144     $ 3,320,053     $ 3,320,129  
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated Average Quarter-to-Date Balance Sheets
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands)
                             
 ASSETS
                             
 Cash and non-interest bearing balances due from banks
  $ 43,691     $ 36,603     $ 35,899     $ 37,469     $ 35,132  
 Interest bearing balances due from banks
    490,532       479,435       550,512       576,416       546,478  
 Federal funds sold
    8,931       2,850       363       281       99  
     Cash and cash equivalents
    543,154       518,888       586,774       614,166       581,709  
 Investment securities - held-to-maturity
    511,203       496,102       508,293       496,002       501,812  
 Investment securities - available-for-sale
    194,815       178,247       172,539       172,523       173,360  
 Mortgage loans held for sale
    17,804       19,334       17,623       17,076       20,035  
 Assets held in trading accounts
    7,701       7,780       7,831       6,845       7,375  
 Loans:
                                       
 Not covered by FDIC loss share agreements
    1,633,710       1,637,437       1,579,166       1,550,341       1,590,584  
 Acquired, not covered by FDIC loss share agreements
                                       
 (net of discounts)
    82,764       12,700       -       -       -  
 Covered by FDIC loss share agreements (net of discounts)
    218,135       117,809       120,695       141,563       168,506  
 Allowance for loan losses
    (28,660 )     (29,228 )     (29,339 )     (30,896 )     (29,730 )
 Net loans
    1,905,949       1,738,718       1,670,522       1,661,008       1,729,360  
 FDIC indemnification asset
    66,994       39,476       38,563       44,845       50,180  
 Premises and equipment
    87,784       85,173       85,629       86,187       86,881  
 Foreclosed assets not covered by FDIC loss share agreements
    34,883       24,945       24,322       23,279       22,702  
 Foreclosed assets covered by FDIC loss share agreements
    29,779       14,521       12,079       13,048       12,409  
 Interest receivable
    15,154       13,484       12,877       13,847       16,071  
 Bank owned life insurance
    51,864       51,507       51,133       50,761       50,362  
 Goodwill
    60,605       60,605       60,605       60,605       60,605  
 Core deposit premiums
    2,955       1,614       1,467       1,541       1,685  
 Other assets
    3,574       14,991       15,114       17,952       18,562  
 Total assets
  $ 3,534,218     $ 3,265,385     $ 3,265,371     $ 3,279,685     $ 3,333,108  
                                         
 LIABILITIES AND STOCKHOLDERS' EQUITY
                                       
 Deposits:
                                       
 Non-interest bearing transaction accounts
  $ 570,800     $ 504,923     $ 502,884     $ 494,366     $ 535,663  
 Interest bearing transaction accounts and savings deposits
    1,405,956       1,291,141       1,282,616       1,252,972       1,228,495  
 Time deposits less than $100,000
    523,050       477,275       477,588       492,354       508,847  
 Time deposits greater than $100,000
    380,843       361,504       360,233       371,168       388,470  
         Total deposits
    2,880,649       2,634,843       2,623,321       2,610,860       2,661,475  
 Federal funds purchased and securities
                                       
 sold under agreements to repurchase
    101,815       72,381       82,738       108,841       107,750  
 Other borrowings
    89,617       90,307       89,606       89,920       91,552  
 Subordinated debentures
    20,620       30,594       30,930       30,930       30,930  
 Accrued interest and other liabilities
    33,227       30,219       29,077       27,417       31,303  
 Total liabilities
    3,125,928       2,858,344       2,855,672       2,867,968       2,923,010  
 Total stockholders' equity
    408,290       407,041       409,699       411,717       410,098  
 Total liabilities and stockholders' equity
  $ 3,534,218     $ 3,265,385     $ 3,265,371     $ 3,279,685     $ 3,333,108  
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated Statements of Income - Quarter-to-Date
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands, except per share data)
                             
 INTEREST INCOME
                             
    Loans not covered by loss share agreements
  $ 23,912     $ 23,192     $ 22,358     $ 22,272     $ 23,370  
    Loans covered by FDIC loss share agreements
    6,759       5,041       4,994       5,973       4,513  
    Federal funds sold
    4       2       1       -       1  
    Investment securities
    3,106       3,027       3,313       3,275       3,568  
    Mortgage loans held for sale
    149       171       164       153       198  
    Assets held in trading accounts
    11       12       13       12       7  
    Interest bearing balances due from banks
    301       267       349       303       324  
            TOTAL INTEREST INCOME
    34,242       31,712       31,192       31,988       31,981  
 INTEREST EXPENSE
                                       
    Time deposits
    1,807       1,863       2,004       2,269       2,577  
    Other deposits
    652       658       676       696       779  
    Federal funds purchased and securities
                                       
      sold under agreements to repurchase
    65       69       77       99       118  
    Other borrowings
    948       792       799       815       826  
    Subordinated debentures
    163       389       385       391       384  
            TOTAL INTEREST EXPENSE
    3,635       3,771       3,941       4,270       4,684  
 NET INTEREST INCOME
    30,607       27,941       27,251       27,718       27,297  
    Provision for loan losses
    1,295       1,299       775       771       2,831  
 NET INTEREST INCOME AFTER PROVISION
                                       
    FOR LOAN LOSSES
    29,312       26,642       26,476       26,947       24,466  
 NON-INTEREST INCOME
                                       
    Trust income
    1,484       1,440       1,240       1,309       1,416  
    Service charges on deposit accounts
    4,645       4,368       3,930       3,865       4,289  
    Other service charges and fees
    747       684       738       792       699  
    Mortgage lending income
    1,553       1,705       1,445       1,294       1,464  
    Investment banking income
    337       560       442       699       294  
    Credit card fees
    4,655       4,104       4,207       4,079       4,318  
    Bank owned life insurance income
    385       355       368       355       403  
    Gain on sale of securities
    2       -       -       -       -  
    Gain on FDIC-assisted transactions
    2,291       1,120       -       -       -  
    Net gain (loss) on assets covered by FDIC loss share agreements
    (2,286 )     (2,689 )     (2,153 )     (2,665 )     (826 )
    Other income
    930       165       876       995       786  
            TOTAL NON-INTEREST INCOME
    14,743       11,812       11,093       10,723       12,843  
 NON-INTEREST EXPENSE
                                       
    Salaries and employee benefits
    17,674       15,911       16,590       16,824       15,973  
    Occupancy expense, net
    2,311       2,182       2,029       2,081       1,930  
    Furniture and equipment expense
    1,835       1,835       1,608       1,604       1,721  
    Other real estate and foreclosure expense
    311       280       194       207       146  
    Deposit insurance
    614       444       457       571       295  
    Merger related costs
    1,081       815       -       -       -  
    Other operating expenses
    8,340       7,219       7,366       7,350       8,381  
            TOTAL NON-INTEREST EXPENSE
    32,166       28,686       28,244       28,637       28,446  
 NET INCOME BEFORE INCOME TAXES
    11,889       9,768       9,325       9,033       8,863  
    Provision for income taxes
    3,856       3,008       2,789       2,678       2,558  
 NET INCOME
  $ 8,033     $ 6,760     $ 6,536     $ 6,355     $ 6,305  
 BASIC EARNINGS PER SHARE
  $ 0.48     $ 0.41     $ 0.38     $ 0.37     $ 0.37  
 DILUTED EARNINGS PER SHARE
  $ 0.48     $ 0.41     $ 0.38     $ 0.37     $ 0.37  
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated Statements of Income - Year-to-Date
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands, except per share data)
                             
 INTEREST INCOME
                             
    Loans not covered by loss share agreements
  $ 91,734     $ 67,822     $ 44,630     $ 22,272     $ 95,713  
    Loans covered by FDIC loss share agreements
    22,767       16,009       10,967       5,973       17,118  
    Federal funds sold
    7       4       1       -       6  
    Investment securities
    12,721       9,615       6,588       3,275       14,583  
    Mortgage loans held for sale
    637       487       317       153       503  
    Assets held in trading accounts
    48       37       25       12       33  
    Interest bearing balances due from banks
    1,220       919       652       303       1,100  
            TOTAL INTEREST INCOME
    129,134       94,893       63,180       31,988       129,056  
 INTEREST EXPENSE
                                       
    Time deposits
    7,943       6,136       4,273       2,269       11,314  
    Other deposits
    2,682       2,029       1,372       696       3,611  
    Federal funds purchased and securities
                                       
      sold under agreements to repurchase
    310       248       176       99       450  
    Other borrowings
    3,354       2,406       1,613       815       3,512  
    Subordinated debentures
    1,328       1,166       777       391       1,509  
            TOTAL INTEREST EXPENSE
    15,617       11,985       8,211       4,270       20,396  
 NET INTEREST INCOME
    113,517       82,908       54,969       27,718       108,660  
    Provision for loan losses
    4,140       2,846       1,546       771       11,676  
 NET INTEREST INCOME AFTER PROVISION
                                       
    FOR LOAN LOSSES
    109,377       80,062       53,423       26,947       96,984  
 NON-INTEREST INCOME
                                       
    Trust income
    5,473       3,988       2,549       1,309       5,375  
    Service charges on deposit accounts
    16,808       12,163       7,795       3,865       16,808  
    Other service charges and fees
    2,961       2,211       1,530       792       2,980  
    Mortgage lending income
    5,997       4,441       2,739       1,294       4,188  
    Investment banking income
    2,038       1,700       1,141       699       1,478  
    Credit card fees
    17,045       12,390       8,286       4,079       16,828  
    Bank owned life insurance income
    1,463       1,078       723       355       1,481  
    Gain on sale of securities
    2       -       -       -       -  
    Gain on FDIC-assisted transactions
    3,411       1,120       -       -       -  
    Net gain (loss) on assets covered by FDIC loss share agreements
    (9,793 )     (7,507 )     (4,818 )     (2,665 )     154  
    Other income
    2,966       2,037       1,871       995       4,173  
            TOTAL NON-INTEREST INCOME
    48,371       33,621       21,816       10,723       53,465  
 NON-INTEREST EXPENSE
                                       
    Salaries and employee benefits
    66,999       49,323       33,414       16,824       65,058  
    Occupancy expense, net
    8,603       6,291       4,110       2,081       8,443  
    Furniture and equipment expense
    6,882       5,047       3,212       1,604       6,633  
    Other real estate and foreclosure expense
    992       681       401       207       678  
    Deposit insurance
    2,086       1,472       1,028       571       2,387  
    Merger related costs
    1,896       815       -       -       357  
    Other operating expenses
    30,275       21,928       14,716       7,350       31,094  
            TOTAL NON-INTEREST EXPENSE
    117,733       85,557       56,881       28,637       114,650  
 NET INCOME BEFORE INCOME TAXES
    40,015       28,126       18,358       9,033       35,799  
    Provision for income taxes
    12,331       8,475       5,467       2,678       10,425  
 NET INCOME
  $ 27,684     $ 19,651     $ 12,891     $ 6,355     $ 25,374  
 BASIC EARNINGS PER SHARE
  $ 1.64     $ 1.16     $ 0.75     $ 0.37     $ 1.47  
 DILUTED EARNINGS PER SHARE
  $ 1.64     $ 1.16     $ 0.75     $ 0.37     $ 1.47  
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated Risk-Based Capital
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands)
                             
Tier 1 capital
                             
    Stockholders' equity
  $ 406,062     $ 404,248     $ 407,413     $ 409,312     $ 407,911  
    Trust preferred securities, net allowable
    20,000       20,000       30,000       30,000       30,000  
    Disallowed intangible assets, net of deferred tax
    (48,966 )     (48,053 )     (47,235 )     (47,607 )     (47,889 )
    Unrealized gain on AFS securities
    (257 )     (582 )     (501 )     (388 )     (439 )
                                         
       Total Tier 1 capital
    376,839       375,613       389,677       391,317       389,583  
                                         
Tier 2 capital
                                       
    Qualifying unrealized gain on AFS equity securities
    19       14       15       14       9  
    Qualifying allowance for loan losses
    24,743       24,395       22,910       22,096       22,682  
                                         
       Total Tier 2 capital
    24,762       24,409       22,925       22,110       22,691  
                                         
       Total risk-based capital
  $ 401,601     $ 400,022     $ 412,602     $ 413,427     $ 412,274  
                                         
 Risk weighted assets
  $ 1,974,800     $ 1,946,344     $ 1,825,808     $ 1,759,932     $ 1,805,585  
                                         
 Adjusted average assets for leverage ratio
  $ 3,484,504     $ 3,216,488     $ 3,217,291     $ 3,231,257     $ 3,284,379  
                                         
Ratios at end of quarter
                                       
    Equity to assets
    11.51 %     11.84 %     12.51 %     12.33 %     12.29 %
    Tangible common equity to tangible assets
    9.87 %     10.18 %     10.81 %     10.66 %     10.61 %
    Tier 1 leverage ratio
    10.81 %     11.68 %     12.11 %     12.11 %     11.86 %
    Tier 1 risk-based capital ratio
    19.08 %     19.30 %     21.34 %     22.23 %     21.58 %
    Total risk-based capital ratio
    20.34 %     20.55 %     22.60 %     23.49 %     22.83 %
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated Loans and Investments
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands)
                             
Legacy Loan Portfolio - End of Period (1)
                             
 Consumer
                             
    Credit cards
  $ 185,536     $ 175,760     $ 176,325     $ 175,013     $ 189,970  
    Student loans
    34,145       36,441       39,823       44,059       47,419  
    Other consumer
    105,319       107,604       107,284       110,001       109,211  
 Total consumer
    325,000       319,805       323,432       329,073       346,600  
 Real Estate
                                       
    Construction
    138,132       128,423       117,235       109,979       109,825  
    Single-family residential
    356,907       355,976       355,978       349,009       355,094  
    Other commercial
    568,166       546,224       550,418       537,807       536,372  
 Total real estate
    1,063,205       1,030,623       1,023,631       996,795       1,001,291  
 Commercial
                                       
    Commercial
    141,336       138,719       140,868       144,772       141,422  
    Agricultural
    93,805       130,727       122,245       69,598       85,728  
 Total commercial
    235,141       269,446       263,113       214,370       227,150  
 Other
    5,167       3,527       4,560       3,415       4,728  
       Total Loans
  $ 1,628,513     $ 1,623,401     $ 1,614,736     $ 1,543,653     $ 1,579,769  
                                         
(1) Excludes all acquired loans, including those covered by FDIC loss share agreements.
 
                                         
Investment Securities - End of Period
                                       
 Held-to-Maturity
                                       
    U.S. Treasury
  $ -     $ -     $ -     $ 4,000     $ 4,000  
    U.S. Government agencies
    288,098       303,640       315,493       267,991       308,779  
    Mortgage-backed securities
    49       51       56       59       62  
    State and political subdivisions
    207,374       206,319       209,043       208,334       211,673  
    Other securities
    620       620       930       930       930  
       Total held-to-maturity
    496,141       510,630       525,522       481,314       525,444  
 Available-for-Sale
                                       
    U.S. Government agencies
    152,481       164,467       148,837       157,631       153,627  
    Mortgage-backed securities
    20,634       24,333       2,493       2,528       2,557  
    State and political subdivisions
    2,988       -       -       -       -  
    FHLB stock
    5,498       5,788       5,578       6,241       6,237  
    Other securities
    9,741       10,463       10,058       10,066       9,791  
       Total available-for-sale
    191,342       205,051       166,966       176,466       172,212  
       Total investment securities
  $ 687,483     $ 715,681     $ 692,488     $ 657,780     $ 697,656  
       Fair value - HTM investment securities
  $ 500,578     $ 516,419     $ 531,499     $ 486,743     $ 532,206  
                                         
Investment Securities - QTD Average
                                       
 Taxable securities
  $ 495,917     $ 467,988     $ 471,826     $ 459,164     $ 466,369  
 Tax exempt securities
    210,101       206,361       209,006       209,361       208,803  
    Total investment securities - QTD average
  $ 706,018     $ 674,349     $ 680,832     $ 668,525     $ 675,172  
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated Allowance and Asset Quality
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands)
                             
Allowance for Loan Losses
                             
 Balance, beginning of quarter
  $ 28,145     $ 28,397     $ 28,325     $ 30,108     $ 29,151  
 Loans charged off
                                       
    Credit cards
    884       806       829       997       1,262  
    Other consumer
    362       358       252       226       530  
    Real estate
    705       773       78       2,539       885  
    Commercial
    163       86       165       129       226  
       Total loans charged off
    2,114       2,023       1,324       3,891       2,903  
                                         
 Recoveries of loans previously charged off
                                       
    Credit cards
    194       242       212       210       244  
    Other consumer
    177       107       135       156       100  
    Real estate
    144       61       248       930       436  
    Commercial
    41       62       26       41       249  
       Total recoveries
    556       472       621       1,337       1,029  
    Net loans charged off
    1,558       1,551       703       2,554       1,874  
 Provision for loan losses
    1,295       1,299       775       771       2,831  
 Balance, end of quarter
  $ 27,882     $ 28,145     $ 28,397     $ 28,325     $ 30,108  
                                         
Non-performing assets (1) (2)
                                       
 Non-performing loans
                                       
    Nonaccrual loans
                                       
       Real estate
  $ 7,135     $ 6,197     $ 6,851     $ 6,898     $ 10,315  
       Commercial
    618       894       676       942       1,253  
       Consumer
    1,370       1,389       1,462       1,299       1,339  
          Total nonaccrual loans
    9,123       8,480       8,989       9,139       12,907  
    Loans past due 90 days or more
                                       
       Government guaranteed student loans
    2,234       2,324       3,275       3,434       2,483  
       Other loans
    681       1,001       509       606       785  
          Total loans past due 90 days or more
    2,915       3,325       3,784       4,040       3,268  
             Total non-performing loans
    12,038       11,805       12,773       13,179       16,175  
 Other non-performing assets
                                       
    Foreclosed assets held for sale
    21,556       23,126       23,947       24,542       22,887  
Acquired foreclosed assets held for sale, not covered
                                 
       by FDIC loss share agreements
    11,796       6,539       -       -       -  
    Other non-performing assets
    221       60       -       1       -  
          Total other non-performing assets
    33,573       29,725       23,947       24,543       22,887  
             Total non-performing assets
  $ 45,611     $ 41,530     $ 36,720     $ 37,722     $ 39,062  
 Performing TDRs (troubled debt restructurings)
  $ 11,015     $ 10,995     $ 11,492     $ 11,531     $ 11,391  
                                         
Ratios (1) (2)
                                       
 Allowance for loan losses to total loans
    1.71 %     1.73 %     1.76 %     1.83 %     1.91 %
 Allowance for loan losses to non-performing loans
    232 %     238 %     222 %     215 %     186 %
 Non-performing loans to total loans
    0.74 %     0.73 %     0.79 %     0.85 %     1.02 %
Non-performing assets (including performing TDRs)
                                 
   to total assets
    1.61 %     1.54 %     1.48 %     1.48 %     1.52 %
 Non-performing assets to total assets
    1.29 %     1.22 %     1.13 %     1.14 %     1.18 %
 Non-performing assets to total assets
                                       
   (excluding Gov't guaranteed student loans)
    1.23 %     1.15 %     1.03 %     1.03 %     1.10 %
 Annualized net charge offs to total loans
    0.38 %     0.38 %     0.18 %     0.66 %     0.47 %
 Annualized net credit card charge offs to
                                       
   total credit card loans
    1.54 %     1.27 %     1.42 %     1.75 %     2.20 %
 Annualized net charge offs to total loans
                                       
   (excluding credit cards)
    0.24 %     0.27 %     0.02 %     0.52 %     0.24 %
 Past due loans >30 days (excluding nonaccrual)
    0.63 %     0.75 %     0.68 %     0.83 %     0.82 %
Past due loans >30 days (excluding nonaccrual)
                                 
   (excluding Gov't guaranteed student loans)
    0.44 %     0.48 %     0.42 %     0.47 %     0.56 %
                                         
 (1) Excludes all acquired loans, including those covered by FDIC loss share agreements, except for their inclusion in total assets.
 (2) Excludes acquired foreclosed assets covered by FDIC loss share agreements, except for their inclusion in total assets.
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated - Net Interest Income Analysis
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
                               
ASSETS
                             
                               
Earning Assets
                             
   Interest bearing balances due from banks
    0.24 %     0.22 %     0.25 %     0.21 %     0.24 %
   Investment securities
    2.39 %     2.46 %     2.66 %     2.69 %     2.81 %
   Mortgage loans held for sale
    3.33 %     3.52 %     3.74 %     3.60 %     3.92 %
   Assets held in trading accounts
    0.57 %     0.61 %     0.67 %     0.71 %     0.38 %
   Loans, including covered loans*
    6.59 %     6.40 %     6.47 %     6.72 %     6.29 %
      Total interest earning assets
    4.45 %     4.45 %     4.41 %     4.51 %     4.38 %
                                         
                                         
LIABILITIES
                                       
                                         
Interest bearing liabilities
                                       
   Interest bearing transaction and
                                       
     savings accounts
    0.18 %     0.20 %     0.21 %     0.22 %     0.25 %
   Time deposits
    0.80 %     0.88 %     0.96 %     1.06 %     1.14 %
      Total interest bearing deposits
    0.42 %     0.47 %     0.51 %     0.56 %     0.63 %
   Federal funds purchased and securities
                                       
     sold under agreement to repurchase
    0.25 %     0.38 %     0.37 %     0.37 %     0.43 %
   Other borrowings
    4.21 %     3.49 %     3.59 %     3.65 %     3.58 %
   Subordinated debentures
    3.14 %     5.06 %     5.01 %     5.08 %     4.93 %
      Total interest bearing liabilities
    0.57 %     0.65 %     0.68 %     0.73 %     0.79 %
                                         
NET INTEREST MARGIN/SPREAD
                                       
                                         
   Net interest spread
    3.88 %     3.80 %     3.73 %     3.78 %     3.59 %
   Net interest margin - quarter-to-date
    3.99 %     3.94 %     3.87 %     3.93 %     3.76 %
   Net interest margin - year-to-date
    3.93 %     3.91 %     3.90 %     3.93 %     3.85 %
                                         
* Covered loans are loans covered by FDIC loss share agreements.
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated - Selected Financial Data
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands, except share data)
                             
QUARTER-TO-DATE
                             
 Diluted earnings per share
  $ 0.48     $ 0.41     $ 0.38     $ 0.37     $ 0.37  
 Core earnings (excludes nonrecurring items) (non-GAAP)
    7,404       6,575       6,536       6,355       6,305  
 Diluted core earnings per share (non-GAAP)
    0.44       0.40       0.38       0.37       0.37  
 Cash dividends declared per common share
    0.20       0.20       0.20       0.20       0.19  
 Cash dividends declared - amount
    3,323       3,334       3,395       3,444       3,271  
 Return on average stockholders' equity
    7.83 %     6.61 %     6.42 %     6.21 %     6.10 %
 Return on tangible equity
    9.36 %     7.85 %     7.61 %     7.36 %     7.34 %
 Return on average assets
    0.90 %     0.82 %     0.81 %     0.78 %     0.75 %
 Net interest margin (FTE)
    3.99 %     3.94 %     3.87 %     3.93 %     3.76 %
 FTE adjustment - investments
    1,134       1,138       1,196       1,192       1,219  
 FTE adjustment - loans
    11       11       12       11       12  
 Amortization of intangibles
    126       74       74       74       214  
 Amortization of intangibles, net of taxes
    77       45       45       45       130  
 Average shares outstanding
    16,624,637       16,756,589       17,044,160       17,215,027       17,250,718  
 Average earning assets
    3,165,595       2,938,994       2,957,022       2,961,047       3,008,249  
 Average interest bearing liabilities
    2,521,901       2,323,202       2,323,711       2,346,185       2,356,044  
                                         
YEAR-TO-DATE
                                       
 Diluted earnings per share
  $ 1.64     $ 1.16     $ 0.75     $ 0.37     $ 1.47  
 Core earnings (excludes nonrecurring items) (non-GAAP)
    26,870       19,466       12,891       6,355       24,988  
 Diluted core earnings per share (non-GAAP)
    1.59       1.15       0.75       0.37       1.45  
 Cash dividends declared per common share
    0.80       0.60       0.40       0.20       0.76  
 Cash dividends declared - amount
    13,496       10,173       6,839       3,444       13,156  
 Return on average stockholders' equity
    6.77 %     6.41 %     6.31 %     6.21 %     6.25 %
 Return on tangible equity
    8.05 %     7.61 %     7.49 %     7.36 %     7.54 %
 Return on average assets
    0.83 %     0.80 %     0.79 %     0.78 %     0.77 %
 Net interest margin (FTE)
    3.93 %     3.91 %     3.90 %     3.93 %     3.85 %
 FTE adjustment - investments
    4,660       3,526       2,388       1,192       4,920  
 FTE adjustment - loans
    45       34       23       11       50  
 Amortization of intangibles
    348       222       148       74       884  
 Amortization of intangibles, net of taxes
    212       135       90       45       537  
 Average shares outstanding
    16,908,904       17,004,351       17,129,593       17,215,027       17,309,488  
 Average diluted shares outstanding
    16,911,363       17,007,623       17,134,232       17,223,085       17,317,850  
 Average earning assets
    3,008,840       2,952,324       2,959,034       2,961,047       2,954,285  
 Average interest bearing liabilities
    2,378,748       2,331,032       2,334,948       2,346,185       2,362,028  
                                         
END OF PERIOD
                                       
 Book value per share
  $ 24.55     $ 24.26     $ 24.03     $ 23.82     $ 23.70  
 Tangible book value per share
    20.66       20.47       20.37       20.21       20.09  
 Shares outstanding
    16,542,778       16,660,278       16,956,991       17,182,526       17,212,317  
 Full-time equivalent employees
    1,068       1,073       1,074       1,077       1,083  
 Total number of ATM's
    110       106       102       102       102  
 Total number of financial centers
    92       88       84       84       84  
 Parent company only - investment in subsidiaries
    368,847       387,944       386,441       384,713       381,236  
 Parent company only - intangible assets
    133       133       133       133       133  
 
 
 

 
Simmons First National Corporation
 
SFNC
 
Consolidated - Reconciliation of Core Earnings (non-GAAP)
     
For the Quarters Ended
 
Dec 31
   
Sep 30
   
Jun 30
   
Mar 31
   
Dec 31
 
(Unaudited)
 
2012
   
2012
   
2012
   
2012
   
2011
 
(in thousands, except per share data)
                             
QUARTER-TO-DATE
                             
 Net Income
  $ 8,033     $ 6,760     $ 6,536     $ 6,355     $ 6,305  
 Nonrecurring items
                                       
Gain on FDIC assisted transactions
    (2,291 )     (1,120 )     -       -       -  
Merger related costs
    1,081       815       -       -       -  
FHLB prepayment penalties
    175       -       -       -       -  
Tax effect
    406       120       -       -       -  
 Net nonrecurring items
    (629 )     (185 )     -       -       -  
 Core earnings (non-GAAP)
  $ 7,404     $ 6,575     $ 6,536     $ 6,355     $ 6,305  
                                         
 Diluted earnings per share
  $ 0.48     $ 0.41     $ 0.38     $ 0.37     $ 0.37  
 Nonrecurring items
                                       
Gain on FDIC assisted transactions
    (0.14 )     (0.07 )     -       -       -  
Merger related costs
    0.07       0.05       -       -       -  
FHLB prepayment penalties
    0.01       -       -       -       -  
Tax effect
    0.02       0.01       -       -       -  
 Net nonrecurring items
    (0.04 )     (0.01 )     -       -       -  
 Diluted core earnings per share (non-GAAP)
  $ 0.44     $ 0.40     $ 0.38     $ 0.37     $ 0.37  
                                         
YEAR-TO-DATE
                                       
 Net Income
  $ 27,684     $ 19,651     $ 12,891     $ 6,355     $ 25,374  
 Nonrecurring items
                                       
Gain on sale of MasterCard stock (1)
    -       -       -       -       (1,132 )
Gain on FDIC assisted transactions
    (3,411 )     (1,120 )     -       -       -  
Merger related costs
    1,896       815       -       -       357  
FHLB prepayment penalties
    175       -       -       -       -  
Branch right sizing
    -       -       -       -       141  
Tax effect
    526       120       -       -       248  
 Net nonrecurring items
    (814 )     (185 )     -       -       (386 )
 Core earnings (non-GAAP)
  $ 26,870     $ 19,466     $ 12,891     $ 6,355     $ 24,988  
                                         
 Diluted earnings per share
  $ 1.64     $ 1.16     $ 0.75     $ 0.37     $ 1.47  
 Nonrecurring items
                                       
Gain on sale of MasterCard stock (1)
    -       -       -       -       (0.07 )
Gain on FDIC assisted transactions
    (0.21 )     (0.07 )     -       -       -  
Merger related costs
    0.12       0.05       -       -       0.02  
FHLB prepayment penalties
    0.01       -       -       -       -  
Branch right sizing
    -       -       -       -       0.01  
Tax effect
    0.03       0.01       -       -       0.02  
 Net nonrecurring items
    (0.05 )     (0.01 )     -       -       (0.02 )
 Diluted core earnings per share (non-GAAP)
  $ 1.59     $ 1.15     $ 0.75     $ 0.37     $ 1.45  
                                         
 (1) Gain from liquidation of Class B shares received as part of MasterCard's 2006 IPO.