Attached files
| file | filename |
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| 8-K - MIDSOUTH BANCORP FORM 8-K - MIDSOUTH BANCORP INC | form8-kxoctober27.htm |
| EX-99.2 - 3Q15 SUPPLEMENTAL MATERIALS - MIDSOUTH BANCORP INC | supplementalmaterials.htm |
Investor Contacts: Rusty Cloutier President & CEO or Jim McLemore, CFA Sr. EVP & CFO 337.237.8343 |
MidSouth Bancorp, Inc. Reports Third Quarter 2015 Results and Declares Quarterly Dividends
Quarterly Highlights
• | Diluted operating EPS $0.21 versus $0.35 for 2Q2015 and $0.36 for 3Q2014 |
• | Linked quarter loans increased at 2% annualized rate |
• | Tangible capital and regulatory ratios improved during 3Q15 |
• | Loan loss reserve to total loans of 1.46% with $3.8 million provision |
• | No energy-related charge-offs during 3Q; YTD energy charge-offs $557,000 |
• | Operating noninterest expense $16.6 million versus $17.0 million for 2Q2015 |
LAFAYETTE, LA., October 27, 2015/PRNewswire-FirstCall/ -- MidSouth Bancorp, Inc. (“MidSouth”) (NYSE:MSL) today reported quarterly net earnings available to common shareholders of $2.4 million for the third quarter of 2015, compared to net earnings available to common shareholders of $4.3 million reported for the third quarter of 2014 and $4.9 million in net earnings available to common shareholders for the second quarter of 2015. Diluted earnings for the third quarter of 2015 were $0.21 per common share, compared to $0.37 per common share reported for the third quarter of 2014 and $0.42 per common share reported for the second quarter of 2015.
Operating earnings for the second quarter of 2015 included a gain on sale of securities of $1.1 million and $160,000 of income recognized from a death benefit on bank owned life insurance. The third quarter of 2014 included a $1.1 million gain on the sale of a commercial property held as other real estate (“ORE”), a $258,000 charge on the redemption of the Company’s Statutory Trust 1 and Capital Securities (TRUPS), and a $394,000 loss on disposal of fixed assets incurred in the quarter. The third quarter of 2014 also included efficiency consultant expenses of $200,000. Excluding these non-operating income and expenses, operating earnings per share for the second quarter of 2015 and the third quarter of 2014 was $0.35 and $0.36, respectively.
C. R. Cloutier, President and CEO, commenting on third quarter earnings remarked, "Despite the elevated level of nonperforming assets added during the quarter, we continue to produce strong pre-provision pre-tax earnings that were almost double our loan loss provision and as a result build capital levels. Moreover, our year to date loan loss provision is over 3 times our year to date net charge-offs."
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Energy Lending Update
• | Energy loans increased $29.2 million during the quarter to $295.6 million at September 30, 2015 |
• | As of the date of this release, energy loans declined to $259.8 million, or $35.8 million during the month of October due to substantial paydown activity |
• | No energy-related charge-offs during 3Q15; YTD energy charge-offs $557,000 |
• | There was only one energy-related impairment during the quarter of $1.1 million |
• | Energy reserve stands at 2.4% of energy loans at September 30, 2015 |
• | One energy loan relationship of $21.1 million moved from accruing Troubled Debt Restructure (TDR) to non-accruing TDR during 3Q15 |
• | Eight energy loan relationships had rating changes during the quarter |
◦ | Three loan relationships totaling $9.2 million were downgraded to Special Mention |
◦ | Four loan relationships totaling $13.7 million were downgraded to Substandard |
◦ | One loan relationship totaling $2.5 million was upgraded to Special Mention during the quarter |
Cloutier, commenting on the energy business and energy portfolio, noted, "Slowed activity in the energy industry and the continued low price of oil and gas contributed to the addition of $28.4 million energy-related credits to loans on nonaccrual status during the quarter as well as some additional rating downgrades. Despite the continued slowdown in the energy business and the need for us to prudently manage our risk exposure, we continue to see opportunities to lend to some very high quality energy borrowers. We firmly believe the energy lending business is a great long-term business for our company, despite some of the current challenges it presents."
More information on our energy loan portfolio can be found on our website at MidSouthBank.com under Investor Relations/Presentations.
Balance Sheet
Total consolidated assets at September 30, 2015 were $2.0 billion, compared to $1.9 billion at June 30, 2015 and June 30, 2014. Our stable core deposit base, which excludes time deposits, totaled $1.3 billion at September 30, 2015 and June 30, 2015 and accounted for 84.8% of deposits for both respective dates. Net loans totaled $1.3 billion at September 30, 2015 and June 30, 2015, compared to $1.2 billion at September 30, 2014. Total loans on a linked quarter basis increased $7.1 million, or 0.5% for the quarter ended September 30, 2015.
MidSouth’s Tier 1 leverage capital ratio was 9.98% at September 30, 2015 compared to 9.79% at June 30, 2015. Tier 1 risk-based capital and total risk-based capital ratios were 12.86% and 14.11% at September 30, 2015, compared to 12.68% and 13.77% at June 30, 2015, respectively. Tier 1 common equity to total risk-weighted assets at September 30, 2015 was 8.62%. Tangible common equity totaled $124.7 million at September 30, 2015, compared to $122.4 million at June 30, 2015. Tangible book value per share at September 30, 2015 was $10.97 versus $10.78 at June 30, 2015.
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Asset Quality
Nonperforming assets totaled $56.4 million at September 30, 2015, an increase of $27.3 million compared to $29.1 million reported at June 30, 2015. The increase resulted primarily from the addition of five energy-related credit relationships totaling $28.4 million that were placed on nonaccrual status during the quarter, $21.1 million of which was classified as a TDR at June 30, 2015. Allowance coverage for nonperforming loans decreased to 36.63% at September 30, 2015, compared to 65.55% at June 30, 2015. The ALLL/total loans ratio was 1.46% at September 30, 2015 and 1.24% at June 30, 2015. Including valuation accounting adjustments on acquired loans, the total valuation accounting adjustment plus ALLL was 1.76% of loans at September 30, 2015. The ratio of annualized net charge-offs to total loans was 0.28% for the three months ended September 30, 2015 compared to 0.34% for the three months ended June 30, 2015.
Total nonperforming assets to total loans plus ORE and other assets repossessed was 4.32% at September 30, 2015 compared to 2.24% at June 30, 2015. Loans classified as troubled debt restructurings, accruing (“TDRs, accruing”) decreased to $168,000 at September 30, 2015 compared to $21.5 million at June 30, 2015 as a result of one $21.1 million energy-related credit relationship transferred to nonaccrual status during the third quarter. Classified assets, including ORE, increased $10.2 million, or 13.5%, to $85.8 million at September 30, 2015 compared to $75.6 million at June 30, 2015. The increase in classified assets during the quarter ended September 30, 2015 is primarily due to downgrades of four energy-related credits totaling $14.0 million.
Third Quarter 2015 vs. Third Quarter 2014 Earnings Comparison
Third quarter 2015 net earnings available to common shareholders totaled $2.4 million compared to $4.3 million for the third quarter of 2014. The third quarter of 2014 included a $1.1 million gain on the sale of a commercial property held as ORE. Excluding this non-operating revenue, revenues from consolidated operations decreased $646,000 in quarterly comparison, from $24.6 million for the three months ended September 30, 2015 to $24.0 million for the three months ended September 30, 2014. Net interest income decreased $371,000 in quarterly comparison primarily due to a $281,000 decrease in interest income earned on loans and a $231,000 decrease in interest income on investment securities which declined in volume. The decrease in interest income on loans and investments securities was partially offset by a $177,000 decrease in interest expense on junior subordinated debentures. Excluding non-operating income of $1.1 million for the third quarter of 2014, noninterest income decreased $275,000 in quarterly comparison, from $5.1 million for the three months ended September 30, 2014 to $4.8 million for the three months ended September 30, 2015. The decrease in noninterest income resulted primarily from a $325,000 reduction in service charges on deposit accounts, including NSF fees.
Excluding non-operating expenses of $852,000 in the third quarter of 2014, noninterest expenses decreased $441,000 in quarterly comparison. A decrease of $634,000 in salaries and benefits costs was partially offset by increases of $122,000 in FDIC premiums and $73,000 in expenses on ORE and other repossessed assets. The provision for loan losses increased $2.6 million in quarterly comparison primarily due to increases in classified assets and specific reserves on impaired loans. Income tax expense decreased $1.2 million in quarterly comparison.
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Dividends paid on the Series B Preferred Stock issued to the Treasury as a result of our participation in the Small Business Lending Fund (“SBLF”) totaled $80,000 for the third quarter of 2015 based on a dividend rate of 1.00%. The dividend rate is set at 1.00% through February 25, 2016. The Series C Preferred Stock issued with the December 28, 2012 acquisition of PSB Financial Corporation (“PSB”) paid dividends totaling $92,000 for the three months ended September 30, 2015.
Fully taxable-equivalent (“FTE”) net interest income totaled $19.4 million and $19.9 million for the quarters ended September 30, 2015 and 2014, respectively. The FTE net interest income decreased $433,000 in prior year quarterly comparison primarily due to a $281,000 decrease in interest income on loans. Despite a $53.8 million increase in the average volume on loans, interest income on loans decreased due to a decrease in the average yield on loans of 33 basis points, from 5.88% to 5.55%. The purchase accounting adjustments added 20 basis points to the average yield on loans for the third quarter of 2015 and 22 basis points to the average yield on loans for the third quarter of 2014. Excluding the impact of the purchase accounting adjustments, average loan yields declined 31 basis points in prior year quarterly comparison, from 5.66% to 5.35%. Loan yields have declined primarily as the result of a sustained low interest rate environment.
Investment securities totaled $406.5 million, or 20.6% of total assets at September 30, 2015, versus $433.4 million, or 22.9% of total assets at September 30, 2014. The investment portfolio had an effective duration of 3.5 years and a net unrealized gain of $3.6 million at September 30, 2015. The average volume of investment securities decreased $23.5 million in prior year quarterly comparison. The average tax equivalent yield on investment securities decreased 13 basis points, from 2.70% to 2.57%. The $23.5 million decrease in the average volume of investment securities was used to fund loan growth during the same period.
The average yield on all earning assets decreased 31 basis points in prior year quarterly comparison, from 4.96% for the third quarter of 2014 to 4.65% for the third quarter of 2015. Excluding the impact of purchase accounting adjustments, the average yield on total earning assets decreased 29 basis points, from 4.80% to 4.51% for the three month periods ended September 30, 2014 and 2015, respectively, primarily due to the decline in the average rate earned on loans and investment securities.
The impact to interest expense of a $34.0 million increase in the average volume of interest- bearing liabilities was offset by a 4 basis point decrease in the average rate paid on interest- bearing liabilities, from 0.46% at September 30, 2014 to 0.42% at September 30, 2015. Excluding purchase accounting adjustments on acquired certificates of deposit and FHLB borrowings, the average rate paid on interest-bearing liabilities was 0.51% for the third quarter of 2014 and declined to 0.45% for the third quarter of 2015.
As a result of these changes in volume and yield on earning assets and interest-bearing liabilities, the FTE net interest margin decreased 27 basis points, from 4.61% for the third quarter of 2014 to 4.34% for the third quarter of 2015. Excluding purchase accounting adjustments on loans, deposits and FHLB borrowings, the FTE margin decreased 25 basis points, from 4.42% for the third quarter of 2014 to 4.17% for the third quarter of 2015.
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Third Quarter 2015 vs. Second Quarter 2015 Earnings Comparison
In sequential-quarter comparison, net earnings available to common shareholders decreased $2.5 million primarily due to a $2.7 million increase in the provision for loan losses. Net interest income decreased $240,000 in sequential-quarter comparison. Second quarter noninterest income included gain on sale of securities of $1.1 million and income from a death benefit on bank owned life insurance of $160,000. Excluding these non-operating revenues, noninterest income decreased $38,000 in sequential-quarter comparison, from $4.9 million for the three months ended June 30, 2015 to $4.8 million for the three months ended September 30, 2015.
Noninterest expense decreased $441,000 in sequential-quarter comparison and consisted primarily of a decrease of $544,000 in salaries and benefits costs that offset increases primarily consisting of $77,000 in ATM and debit card processing fees and $62,000 in expenses on ORE and other repossessed assets.
FTE net interest income decreased $253,000 in sequential-quarter comparison primarily due to a $276,000 decrease in interest income on loans. The average volume of loans decreased $26.4 million and the average yield on loans decreased 3 basis points, from 5.58% for the second quarter of 2015 to 5.55% for the third quarter of 2015. Excluding purchase accounting adjustments, the loan yield declined 4 basis points, from 5.39% to 5.35% during the same period. The average yield on total earning assets decreased 4 basis points for the same period, from 4.69% to 4.65%, respectively. As a result of these changes in volume and yield on earning assets, the FTE net interest margin decreased 4 basis points, from 4.38% to 4.34%. Excluding purchase accounting adjustments, the FTE net interest margin decreased 4 basis points, from 4.21% for the second quarter of 2015 to 4.17% for the third quarter of 2015.
Year-Over-Year Earnings Comparison
In year-over-year comparison, net earnings available to common shareholders decreased $6.3 million, from $14.9 million at September 30, 2014 to $8.7 million at September 30, 2015. The decrease resulted primarily from a $8.0 million increase in the provision for loan losses. The first nine months of 2014 included $3.0 million of executive officer life insurance proceeds, $1.1 million in gain on sale of ORE, $128,000 in gain on sales of securities, $360,000 of efficiency consultant expenses, $189,000 of expenses related to the loss of an executive officer, $394,000 in losses on disposal of fixed assets and a $258,000 loss on redemption of Trust Preferred Securities. The first nine months of 2015 included $1.2 million in gain on sales of securities and $160,000 of income from a death benefit on bank owned life insurance. Excluding these non-operating revenues and expenses, net earnings available to common shareholders decreased $4.3 million in year-over-year comparison. In addition to the increase in loan loss provision, a decrease of $595,000 in noninterest income contributed to the decrease in operating earnings. The increase in the provision for loan losses and the decrease in noninterest income were partially offset by a $259,000 increase in net interest income, a $1.6 million decrease in operating noninterest expenses and a $2.3 million decrease in income tax expense.
Excluding non-operating income, decreases in noninterest income consisted primarily of $897,000 in service charges on deposit accounts (primarily NSF fees), which was partially offset by a $154,000 increase in ATM and debit card income and a $235,000 increase in mortgage
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banking fees. Excluding the non-operating expenses in 2014, decreases in noninterest expense primarily included $1.7 million in salaries and benefits costs, $173,000 in credit reporting expense and $126,000 in the cost of printing and supplies. The decreased expenses were partially offset by a $156,000 increase in legal and professional fees and a $221,000 increase in FDIC premiums.
In year-to-date comparison, FTE net interest income increased $89,000. Interest income on loans increased $789,000 despite an $803,000 reduction in purchase accounting adjustments on acquired loans. The average volume of loans increased $103.5 million in year-over-year comparison, and the average yield on loans decreased 40 basis points, from 5.99% to 5.59%. The increase in interest income on loans was offset by a $1.0 reduction in interest income on investment securities. The average volume of investment securities decreased $47.5 million in year-over-year comparison. The average yield on total earning assets decreased in year-over-year comparison, from 4.97% at September 30, 2014 to 4.70% at September 30, 2015. The purchase accounting adjustments added 29 basis points to the average yield on loans for the nine months ended September 30, 2014 and 17 basis points for the nine months ended September 30, 2015. Excluding purchase accounting adjustments, the average yield on earning assets decreased 19 basis points, from 4.77% at September 30, 2014 to 4.58% at September 30, 2015.
Interest expense decreased $258,000 in year-over-year comparison primarily due to a 5 basis point decrease in the average rate paid on interest-bearing liabilities, from 0.47% at September 30, 2014 to 0.42% at September 30, 2015. Excluding purchase accounting adjustments, the average rate paid on interest-bearing liabilities decreased 6 basis points, from 0.52% at September 30, 2014 to 0.46% at September 30, 2015. The FTE net interest margin decreased 24 basis points, from 4.62% for the nine months ended September 30, 2014 to 4.38% for the nine months ended September 30, 2015. Excluding purchase accounting adjustments, the FTE net interest margin decreased 14 basis points, from 4.38% to 4.24% for the nine months ended September 30, 2014 and 2015, respectively, primarily due to a decline in the average rate earned on loans.
Dividends
MidSouth’s Board of Directors announced a cash dividend was declared in the amount of $0.09 per share to be paid on its common stock on January 4, 2016 to shareholders of record as of the close of business on December 15, 2015. Additionally, a quarterly cash dividend of 1.00% per preferred share on its 4.00% Non-Cumulative Perpetual Convertible Preferred Stock, Series C was declared payable on January 15, 2016 to shareholders of record as of the close of business on January 4, 2016.
About MidSouth Bancorp, Inc.
MidSouth Bancorp, Inc. is a financial holding company headquartered in Lafayette, Louisiana, with assets of $2.0 billion as of September 30, 2015. MidSouth Bancorp, Inc. trades on the NYSE under the symbol “MSL.” Through its wholly owned subsidiary, MidSouth Bank, N.A., MidSouth offers a full range of banking services to commercial and retail customers in Louisiana and Texas. MidSouth Bank currently has 58 locations in Louisiana and Texas and is connected to
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a worldwide ATM network that provides customers with access to more than 55,000 surcharge-free ATMs. Additional corporate information is available at MidSouthBank.com.
Forward-Looking Statements
Certain statements contained herein are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties. These statements include, among others, the expected loan loss provision and future operating results. Actual results may differ materially from the results anticipated in these forward-looking statements. Factors that might cause such a difference include, among other matters, changes in interest rates and market prices that could affect the net interest margin, asset valuation, and expense levels; changes in local economic and business conditions, including, without limitation, changes related to the oil and gas industries, that could adversely affect customers and their ability to repay borrowings under agreed upon terms, adversely affect the value of the underlying collateral related to their borrowings, and reduce demand for loans; the timing and ability to reach any agreement to restructure nonaccrual loans; increased competition for deposits and loans which could affect compositions, rates and terms; the timing and impact of future acquisitions, the success or failure of integrating operations, and the ability to capitalize on growth opportunities upon entering new markets; loss of critical personnel and the challenge of hiring qualified personnel at reasonable compensation levels; legislative and regulatory changes, including changes in banking, securities and tax laws and regulations and their application by our regulators, changes in the scope and cost of FDIC insurance and other coverage; and other factors discussed under the heading “Risk Factors” in MidSouth’s Annual Report on Form 10-K for the year ended December 31, 2014 filed with the SEC on March 13, 2015 and in its other filings with the SEC. MidSouth does not undertake any obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or otherwise, except as required by law.
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MIDSOUTH BANCORP, INC. and SUBSIDIARIES | ||||||||||||||||||||
Condensed Consolidated Financial Information (unaudited) | ||||||||||||||||||||
(in thousands except per share data) | ||||||||||||||||||||
Quarter | Quarter | Quarter | Quarter | Quarter | ||||||||||||||||
Ended | Ended | Ended | Ended | Ended | ||||||||||||||||
EARNINGS DATA | 9/30/2015 | 6/30/2015 | 3/31/2015 | 12/31/2014 | 9/30/2014 | |||||||||||||||
Total interest income | $ | 20,532 | $ | 20,798 | $ | 20,681 | $ | 21,477 | $ | 21,016 | ||||||||||
Total interest expense | 1,391 | 1,417 | 1,424 | 1,317 | 1,504 | |||||||||||||||
Net interest income | 19,141 | 19,381 | 19,257 | 20,160 | 19,512 | |||||||||||||||
FTE net interest income | 19,423 | 19,676 | 19,565 | 20,496 | 19,856 | |||||||||||||||
Provision for loan losses | 3,800 | 1,100 | 6,000 | 2,700 | 1,175 | |||||||||||||||
Non-interest income | 4,840 | 6,166 | 4,967 | 5,050 | 6,194 | |||||||||||||||
Non-interest expense | 16,564 | 17,005 | 16,287 | 17,327 | 17,857 | |||||||||||||||
Earnings before income taxes | 3,617 | 7,442 | 1,937 | 5,183 | 6,674 | |||||||||||||||
Income tax expense | 1,028 | 2,343 | 446 | 1,519 | 2,202 | |||||||||||||||
Net earnings | 2,589 | 5,099 | 1,491 | 3,664 | 4,472 | |||||||||||||||
Dividends on preferred stock | 172 | 172 | 173 | 174 | 174 | |||||||||||||||
Net earnings available to common shareholders | $ | 2,417 | $ | 4,927 | $ | 1,318 | $ | 3,490 | $ | 4,298 | ||||||||||
PER COMMON SHARE DATA | ||||||||||||||||||||
Basic earnings per share | 0.22 | 0.43 | 0.12 | 0.31 | 0.38 | |||||||||||||||
Diluted earnings per share | 0.21 | 0.42 | 0.12 | 0.30 | 0.37 | |||||||||||||||
Diluted earnings per share, operating (Non-GAAP)(*) | 0.21 | 0.35 | 0.11 | 0.31 | 0.36 | |||||||||||||||
Quarterly dividends per share | 0.09 | 0.09 | 0.09 | 0.09 | 0.09 | |||||||||||||||
Book value at end of period | 15.21 | 15.04 | 14.92 | 14.78 | 14.52 | |||||||||||||||
Tangible book value at period end (Non-GAAP)(*) | 10.97 | 10.78 | 10.63 | 10.46 | 10.17 | |||||||||||||||
Market price at end of period | 11.70 | 15.26 | 14.75 | 17.34 | 18.70 | |||||||||||||||
Shares outstanding at period end | 11,361,839 | 11,359,396 | 11,349,285 | 11,340,736 | 11,336,594 | |||||||||||||||
Weighted average shares outstanding | ||||||||||||||||||||
Basic | 11,311,841 | 11,323,506 | 11,317,667 | 11,314,690 | 11,313,879 | |||||||||||||||
Diluted | 11,830,540 | 11,849,683 | 11,351,239 | 11,933,388 | 11,954,811 | |||||||||||||||
AVERAGE BALANCE SHEET DATA | ||||||||||||||||||||
Total assets | $ | 1,949,352 | $ | 1,976,574 | $ | 1,966,752 | $ | 1,929,750 | $ | 1,892,609 | ||||||||||
Loans and leases | 1,285,991 | 1,312,359 | 1,298,317 | 1,264,011 | 1,232,196 | |||||||||||||||
Total deposits | 1,559,308 | 1,593,318 | 1,592,153 | 1,563,006 | 1,525,059 | |||||||||||||||
Total common equity | 173,466 | 170,885 | 170,638 | 167,430 | 163,855 | |||||||||||||||
Total tangible common equity (Non-GAAP)(*) | 125,156 | 122,299 | 121,778 | 118,291 | 114,438 | |||||||||||||||
Total equity | 214,623 | 212,112 | 211,985 | 208,816 | 205,291 | |||||||||||||||
SELECTED RATIOS | ||||||||||||||||||||
Annualized return on average assets, operating (Non-GAAP)(*) | 0.49 | % | 0.82 | % | 0.27 | % | 0.74 | % | 0.87 | % | ||||||||||
Annualized return on average common equity, operating (Non-GAAP)(*) | 5.53 | % | 9.47 | % | 3.13 | % | 8.51 | % | 10.05 | % | ||||||||||
Annualized return on average tangible common equity, operating (Non-GAAP)(*) | 7.66 | % | 13.23 | % | 4.39 | % | 12.04 | % | 14.39 | % | ||||||||||
Pre-tax, pre-provision annualized return on average assets, operating (Non-GAAP)(*) | 1.51 | % | 1.47 | % | 1.64 | % | 1.65 | % | 1.60 | % | ||||||||||
Efficiency ratio, operating (Non-GAAP)(*) | 68.72 | % | 70.08 | % | 67.48 | % | 67.81 | % | 69.05 | % | ||||||||||
Average loans to average deposits | 82.47 | % | 82.37 | % | 81.54 | % | 80.87 | % | 80.80 | % | ||||||||||
Taxable-equivalent net interest margin | 4.34 | % | 4.38 | % | 4.44 | % | 4.65 | % | 4.61 | % | ||||||||||
Tier 1 leverage capital ratio | 9.98 | % | 9.79 | % | 9.63 | % | 9.52 | % | 9.56 | % | ||||||||||
CREDIT QUALITY | ||||||||||||||||||||
Allowance for loan and lease losses (ALLL) as a % of total loans | 1.46 | % | 1.24 | % | 1.23 | % | 0.87 | % | 0.75 | % | ||||||||||
Nonperforming assets to tangible equity + ALLL | 30.51 | % | 16.18 | % | 9.87 | % | 8.83 | % | 7.50 | % | ||||||||||
Nonperforming assets to total loans, other real estate owned and other repossessed assets | 4.32 | % | 2.24 | % | 1.34 | % | 1.17 | % | 0.99 | % | ||||||||||
Annualized QTD net charge-offs to total loans | 0.28 | % | 0.34 | % | 0.36 | % | 0.28 | % | 0.26 | % | ||||||||||
(*) See reconciliation of Non-GAAP financial measures on pages 13-15. | ||||||||||||||||||||
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MIDSOUTH BANCORP, INC. and SUBSIDIARIES | ||||||||||||||||||||
Condensed Consolidated Financial Information (unaudited) | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
BALANCE SHEET | September 30, | June 30, | March 31, | December 31, | September 30, | |||||||||||||||
2015 | 2015 | 2015 | 2014 | 2014 | ||||||||||||||||
Assets | ||||||||||||||||||||
Cash and cash equivalents | $ | 125,437 | $ | 82,636 | $ | 104,402 | $ | 86,872 | $ | 54,215 | ||||||||||
Securities available-for-sale | 285,485 | 300,335 | 299,690 | 276,984 | 288,397 | |||||||||||||||
Securities held-to-maturity | 121,043 | 126,529 | 137,592 | 141,201 | 145,030 | |||||||||||||||
Total investment securities | 406,528 | 426,864 | 437,282 | 418,185 | 433,427 | |||||||||||||||
Other investments | 12,063 | 10,598 | 9,644 | 9,990 | 12,091 | |||||||||||||||
Total loans | 1,301,452 | 1,294,392 | 1,310,929 | 1,284,431 | 1,248,373 | |||||||||||||||
Allowance for loan losses | (18,939 | ) | (16,048 | ) | (16,060 | ) | (11,226 | ) | (9,425 | ) | ||||||||||
Loans, net | 1,282,513 | 1,278,344 | 1,294,869 | 1,273,205 | 1,238,948 | |||||||||||||||
Premises and equipment | 68,718 | 69,263 | 69,762 | 69,958 | 71,115 | |||||||||||||||
Goodwill and other intangibles | 48,175 | 48,452 | 48,729 | 49,005 | 49,282 | |||||||||||||||
Other assets | 30,874 | 32,627 | 30,570 | 29,525 | 32,682 | |||||||||||||||
Total assets | $ | 1,974,308 | $ | 1,948,784 | $ | 1,995,258 | $ | 1,936,740 | $ | 1,891,760 | ||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||||||||
Non-interest bearing deposits | $ | 406,118 | $ | 408,742 | $ | 421,897 | $ | 390,863 | $ | 396,263 | ||||||||||
Interest-bearing deposits | 1,137,303 | 1,149,508 | 1,194,201 | 1,194,371 | 1,124,581 | |||||||||||||||
Total deposits | 1,543,421 | 1,558,250 | 1,616,098 | 1,585,234 | 1,520,844 | |||||||||||||||
Securities sold under agreements to repurchase | 92,085 | 84,547 | 87,346 | 62,098 | 70,964 | |||||||||||||||
Short-term FHLB advances | 70,000 | 40,000 | 25,000 | 25,000 | 35,000 | |||||||||||||||
Other borrowings | 25,958 | 26,064 | 26,171 | 26,277 | 26,384 | |||||||||||||||
Junior subordinated debentures | 22,167 | 22,167 | 22,167 | 22,167 | 22,167 | |||||||||||||||
Other liabilities | 6,713 | 5,720 | 7,820 | 6,952 | 10,387 | |||||||||||||||
Total liabilities | 1,760,344 | 1,736,748 | 1,784,602 | 1,727,728 | 1,685,746 | |||||||||||||||
Total shareholders' equity | 213,964 | 212,036 | 210,656 | 209,012 | 206,014 | |||||||||||||||
Total liabilities and shareholders' equity | $ | 1,974,308 | $ | 1,948,784 | $ | 1,995,258 | $ | 1,936,740 | $ | 1,891,760 | ||||||||||
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MIDSOUTH BANCORP, INC. and SUBSIDIARIES | ||||||||||||||||||||
Condensed Consolidated Financial Information (unaudited) | ||||||||||||||||||||
(in thousands except per share data) | ||||||||||||||||||||
EARNINGS STATEMENT | Three Months Ended | |||||||||||||||||||
9/30/2015 | 6/30/2015 | 3/31/2015 | 12/31/2014 | 9/30/2014 | ||||||||||||||||
Interest income: | ||||||||||||||||||||
Loans, including fees | $ | 17,413 | $ | 17,709 | $ | 17,717 | $ | 18,045 | $ | 17,670 | ||||||||||
Investment securities | 2,386 | 2,412 | 2,509 | 2,566 | 2,617 | |||||||||||||||
Accretion of purchase accounting adjustments | 579 | 559 | 337 | 757 | 603 | |||||||||||||||
Other interest income | 154 | 118 | 118 | 109 | 126 | |||||||||||||||
Total interest income | 20,532 | 20,798 | 20,681 | 21,477 | 21,016 | |||||||||||||||
Interest expense: | ||||||||||||||||||||
Deposits | 903 | 949 | 984 | 973 | 915 | |||||||||||||||
Borrowings | 448 | 436 | 418 | 401 | 409 | |||||||||||||||
Junior subordinated debentures | 150 | 151 | 150 | 80 | 327 | |||||||||||||||
Accretion of purchase accounting adjustments | (110 | ) | (119 | ) | (128 | ) | (137 | ) | (147 | ) | ||||||||||
Total interest expense | 1,391 | 1,417 | 1,424 | 1,317 | 1,504 | |||||||||||||||
Net interest income | 19,141 | 19,381 | 19,257 | 20,160 | 19,512 | |||||||||||||||
Provision for loan losses | 3,800 | 1,100 | 6,000 | 2,700 | 1,175 | |||||||||||||||
Net interest income after provision for loan losses | 15,341 | 18,281 | 13,257 | 17,460 | 18,337 | |||||||||||||||
Noninterest income: | ||||||||||||||||||||
Service charges on deposit accounts | 2,231 | 2,137 | 2,120 | 2,395 | 2,556 | |||||||||||||||
ATM and debit card income | 1,823 | 1,865 | 1,841 | 1,834 | 1,808 | |||||||||||||||
Gain on securities, net (non-operating)(*) | — | 1,128 | 115 | — | — | |||||||||||||||
Gain on sale of ORE (non-operating)(*) | — | — | — | — | 1,079 | |||||||||||||||
Mortgage lending | 197 | 145 | 153 | 151 | 161 | |||||||||||||||
Income from death benefit on bank owned life insurance (non-operating)(*) | — | 160 | — | — | — | |||||||||||||||
Other charges and fees | 589 | 731 | 738 | 670 | 590 | |||||||||||||||
Total non-interest income | 4,840 | 6,166 | 4,967 | 5,050 | 6,194 | |||||||||||||||
Noninterest expense: | ||||||||||||||||||||
Salaries and employee benefits | 7,653 | 8,197 | 7,942 | 8,259 | 8,287 | |||||||||||||||
Occupancy expense | 3,815 | 3,865 | 3,685 | 3,750 | 3,834 | |||||||||||||||
ATM and debit card | 770 | 693 | 663 | 699 | 793 | |||||||||||||||
Legal and professional fees | 385 | 382 | 345 | 330 | 342 | |||||||||||||||
FDIC premiums | 391 | 331 | 281 | 268 | 269 | |||||||||||||||
Marketing | 408 | 417 | 287 | 543 | 396 | |||||||||||||||
Corporate development | 371 | 387 | 320 | 381 | 342 | |||||||||||||||
Data processing | 476 | 467 | 457 | 462 | 503 | |||||||||||||||
Printing and supplies | 228 | 255 | 225 | 280 | 279 | |||||||||||||||
Expenses on ORE and other assets repossessed | 195 | 133 | 153 | 169 | 122 | |||||||||||||||
Amortization of core deposit intangibles | 277 | 276 | 277 | 276 | 277 | |||||||||||||||
Loss on disposal of fixed assets (non-operating)(*) | — | — | — | — | 394 | |||||||||||||||
Loss on redemption of Trust Preferred Securities (non-operating)(*) | — | — | — | — | 258 | |||||||||||||||
Efficiency consultant expenses (non-operating)(*) | — | — | — | 156 | 200 | |||||||||||||||
Other non-interest expense | 1,595 | 1,602 | 1,652 | 1,754 | 1,561 | |||||||||||||||
Total non-interest expense | 16,564 | 17,005 | 16,287 | 17,327 | 17,857 | |||||||||||||||
Earnings before income taxes | 3,617 | 7,442 | 1,937 | 5,183 | 6,674 | |||||||||||||||
Income tax expense | 1,028 | 2,343 | 446 | 1,519 | 2,202 | |||||||||||||||
Net earnings | 2,589 | 5,099 | 1,491 | 3,664 | 4,472 | |||||||||||||||
Dividends on preferred stock | 172 | 172 | 173 | 174 | 174 | |||||||||||||||
Net earnings available to common shareholders | $ | 2,417 | $ | 4,927 | $ | 1,318 | $ | 3,490 | $ | 4,298 | ||||||||||
Earnings per common share, diluted | $ | 0.21 | $ | 0.42 | $ | 0.12 | $ | 0.30 | $ | 0.37 | ||||||||||
Operating earnings per common share, diluted (Non-GAAP)(*) | $ | 0.21 | $ | 0.35 | $ | 0.11 | $ | 0.31 | $ | 0.36 | ||||||||||
(*) See reconciliation of Non-GAAP financial measures on pages 13-15. | ||||||||||||||||||||
10
MIDSOUTH BANCORP, INC. and SUBSIDIARIES | ||||||||||||||||||||||||||
Condensed Consolidated Financial Information (unaudited) | ||||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
COMPOSITION OF LOANS | September 30, | Percent | June 30, | March 31, | December 31, | September 30, | Percent | |||||||||||||||||||
2015 | of Total | 2015 | 2015 | 2014 | 2014 | of Total | ||||||||||||||||||||
Commercial, financial, and agricultural | $ | 482,452 | 37.07 | % | $ | 471,397 | $ | 484,508 | $ | 467,147 | $ | 452,065 | 36.21 | % | ||||||||||||
Lease financing receivable | 4,790 | 0.37 | % | 5,561 | 6,350 | 4,857 | 5,285 | 0.42 | % | |||||||||||||||||
Real estate - construction | 74,279 | 5.71 | % | 79,176 | 76,964 | 68,577 | 86,315 | 6.91 | % | |||||||||||||||||
Real estate - commercial | 473,319 | 36.37 | % | 469,022 | 471,737 | 467,172 | 430,930 | 34.52 | % | |||||||||||||||||
Real estate - residential | 151,667 | 11.65 | % | 153,820 | 153,647 | 154,602 | 153,915 | 12.33 | % | |||||||||||||||||
Installment loans to individuals | 113,199 | 8.70 | % | 113,626 | 115,284 | 119,328 | 116,340 | 9.32 | % | |||||||||||||||||
Other | 1,746 | 0.13 | % | 1,790 | 2,439 | 2,748 | 3,523 | 0.28 | % | |||||||||||||||||
Total loans | $ | 1,301,452 | $ | 1,294,392 | $ | 1,310,929 | $ | 1,284,431 | $ | 1,248,373 | ||||||||||||||||
COMPOSITION OF DEPOSITS | ||||||||||||||||||||||||||
September 30, | Percent | June 30, | March 31, | December 31, | September 30, | Percent | ||||||||||||||||||||
2015 | of Total | 2015 | 2015 | 2014 | 2014 | of Total | ||||||||||||||||||||
Noninterest bearing | $ | 406,118 | 26.31 | % | $ | 408,742 | $ | 421,897 | $ | 390,863 | $ | 396,263 | 26.06 | % | ||||||||||||
NOW & Other | 448,938 | 29.09 | % | 458,338 | 480,454 | 469,627 | 447,403 | 29.42 | % | |||||||||||||||||
Money Market/Savings | 468,297 | 30.34 | % | 453,902 | 463,625 | 473,290 | 460,100 | 30.25 | % | |||||||||||||||||
Time Deposits of less than $100,000 | 85,589 | 5.55 | % | 90,348 | 94,730 | 96,577 | 101,373 | 6.67 | % | |||||||||||||||||
Time Deposits of $100,000 or more | 134,479 | 8.71 | % | 146,920 | 155,392 | 154,877 | 115,705 | 7.61 | % | |||||||||||||||||
Total deposits | $ | 1,543,421 | $ | 1,558,250 | $ | 1,616,098 | $ | 1,585,234 | $ | 1,520,844 | ||||||||||||||||
ASSET QUALITY DATA | ||||||||||||||||||||||||||
September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||||||||
2015 | 2015 | 2015 | 2014 | 2014 | ||||||||||||||||||||||
Nonaccrual loans | $ | 51,616 | $ | 23,873 | $ | 12,894 | $ | 10,701 | $ | 7,750 | ||||||||||||||||
Loans past due 90 days and over | 82 | 609 | 40 | 187 | 23 | |||||||||||||||||||||
Total nonperforming loans | 51,698 | 24,482 | 12,934 | 10,888 | 7,773 | |||||||||||||||||||||
Other real estate | 4,661 | 4,542 | 4,589 | 4,234 | 4,663 | |||||||||||||||||||||
Other repossessed assets | — | 38 | 43 | — | 19 | |||||||||||||||||||||
Total nonperforming assets | $ | 56,359 | $ | 29,062 | $ | 17,566 | $ | 15,122 | $ | 12,455 | ||||||||||||||||
Troubled debt restructurings, accruing | $ | 168 | $ | 21,529 | $ | 173 | $ | 176 | $ | 180 | ||||||||||||||||
Nonperforming assets to total assets | 2.85 | % | 1.49 | % | 0.88 | % | 0.78 | % | 0.66 | % | ||||||||||||||||
Nonperforming assets to total loans + ORE + other repossessed assets | 4.32 | % | 2.24 | % | 1.34 | % | 1.17 | % | 0.99 | % | ||||||||||||||||
ALLL to nonperforming loans | 36.63 | % | 65.55 | % | 124.17 | % | 103.10 | % | 121.25 | % | ||||||||||||||||
ALLL to total loans | 1.46 | % | 1.24 | % | 1.23 | % | 0.87 | % | 0.75 | % | ||||||||||||||||
Quarter-to-date charge-offs | $ | 1,000 | $ | 1,151 | $ | 1,332 | $ | 985 | $ | 1,253 | ||||||||||||||||
Quarter-to-date recoveries | 91 | 39 | 166 | 86 | 428 | |||||||||||||||||||||
Quarter-to-date net charge-offs | $ | 909 | $ | 1,112 | $ | 1,166 | $ | 899 | $ | 825 | ||||||||||||||||
Annualized QTD net charge-offs to total loans | 0.28 | % | 0.34 | % | 0.36 | % | 0.28 | % | 0.26 | % | ||||||||||||||||
11
MIDSOUTH BANCORP, INC. and SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidated Financial Information (unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
YIELD ANALYSIS | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, 2015 | June 30, 2015 | March 31, 2015 | December 31, 2014 | September 30, 2014 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Tax | Tax | Tax | Tax | Tax | |||||||||||||||||||||||||||||||||||||||||||||||||||
Average | Equivalent | Yield/ | Average | Equivalent | Yield/ | Average | Equivalent | Yield/ | Average | Equivalent | Yield/ | Average | Equivalent | Yield/ | |||||||||||||||||||||||||||||||||||||||||
Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | |||||||||||||||||||||||||||||||||||||||||
Taxable securities | $ | 341,192 | $ | 1,850 | 2.17 | % | $ | 345,108 | $ | 1,853 | 2.15 | % | $ | 336,337 | $ | 1,925 | 2.29 | % | $ | 339,536 | $ | 1,936 | 2.28 | % | $ | 351,645 | $ | 1,965 | 2.24 | % | |||||||||||||||||||||||||
Tax-exempt securities | 73,523 | 818 | 4.45 | % | 76,433 | 854 | 4.47 | % | 78,948 | 892 | 4.52 | % | 83,612 | 966 | 4.62 | % | 86,528 | 996 | 4.60 | % | |||||||||||||||||||||||||||||||||||
Total investment securities | 414,715 | 2,668 | 2.57 | % | 421,541 | 2,707 | 2.57 | % | 415,285 | 2,817 | 2.71 | % | 423,148 | 2,902 | 2.74 | % | 438,173 | 2,961 | 2.70 | % | |||||||||||||||||||||||||||||||||||
Federal funds sold | 3,349 | 1 | 0.12 | % | 3,228 | 2 | 0.25 | % | 3,816 | 2 | 0.21 | % | 3,792 | 2 | 0.21 | % | 3,143 | 2 | 0.25 | % | |||||||||||||||||||||||||||||||||||
Time and interest bearing deposits in other banks | 62,086 | 40 | 0.25 | % | 56,110 | 35 | 0.25 | % | 59,225 | 37 | 0.25 | % | 44,841 | 28 | 0.24 | % | 22,922 | 15 | 0.26 | % | |||||||||||||||||||||||||||||||||||
Other investments | 10,508 | 113 | 4.30 | % | 10,057 | 81 | 3.22 | % | 9,754 | 79 | 3.24 | % | 11,063 | 79 | 2.86 | % | 12,090 | 109 | 3.61 | % | |||||||||||||||||||||||||||||||||||
Loans | 1,285,991 | 17,992 | 5.55 | % | 1,312,359 | 18,268 | 5.58 | % | 1,298,317 | 18,054 | 5.64 | % | 1,264,011 | 18,802 | 5.90 | % | 1,232,196 | 18,273 | 5.88 | % | |||||||||||||||||||||||||||||||||||
Total interest earning assets | 1,776,649 | 20,814 | 4.65 | % | 1,803,295 | 21,093 | 4.69 | % | 1,786,397 | 20,989 | 4.77 | % | 1,746,855 | 21,813 | 4.95 | % | 1,708,524 | 21,360 | 4.96 | % | |||||||||||||||||||||||||||||||||||
Non-interest earning assets | 172,703 | 173,279 | 180,355 | 182,895 | 184,085 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total assets | $ | 1,949,352 | $ | 1,976,574 | $ | 1,966,752 | $ | 1,929,750 | $ | 1,892,609 | |||||||||||||||||||||||||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits | $ | 1,150,190 | $ | 883 | 0.30 | % | $ | 1,181,381 | $ | 921 | 0.31 | % | $ | 1,192,086 | $ | 947 | 0.32 | % | $ | 1,158,317 | $ | 927 | 0.32 | % | $ | 1,132,132 | $ | 859 | 0.30 | % | |||||||||||||||||||||||||
Repurchase agreements | 89,025 | 249 | 1.11 | % | 84,545 | 242 | 1.15 | % | 79,630 | 230 | 1.17 | % | 69,735 | 207 | 1.18 | % | 70,587 | 210 | 1.18 | % | |||||||||||||||||||||||||||||||||||
Federal funds purchased | — | — | — | % | — | — | — | % | — | — | — | % | — | — | — | % | 70 | — | — | % | |||||||||||||||||||||||||||||||||||
Short-term borrowings | 31,196 | 16 | 0.20 | % | 30,604 | 13 | 0.17 | % | 25,000 | 8 | 0.13 | % | 28,696 | 12 | 0.16 | % | 28,913 | 13 | 0.18 | % | |||||||||||||||||||||||||||||||||||
Notes payable | 26,007 | 93 | 1.40 | % | 26,114 | 90 | 1.36 | % | 26,219 | 89 | 1.36 | % | 26,326 | 91 | 1.35 | % | 26,640 | 95 | 1.40 | % | |||||||||||||||||||||||||||||||||||
Junior subordinated debentures | 22,167 | 150 | 2.65 | % | 22,167 | 151 | 2.69 | % | 22,167 | 150 | 2.71 | % | 22,167 | 80 | 1.41 | % | 26,247 | 327 | 4.88 | % | |||||||||||||||||||||||||||||||||||
Total interest bearing liabilities | 1,318,585 | 1,391 | 0.42 | % | 1,344,811 | 1,417 | 0.42 | % | 1,345,102 | 1,424 | 0.43 | % | 1,305,241 | 1,317 | 0.40 | % | 1,284,589 | 1,504 | 0.46 | % | |||||||||||||||||||||||||||||||||||
Non-interest bearing liabilities | 416,144 | 419,651 | 409,665 | 415,693 | 402,729 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' equity | 214,623 | 212,112 | 211,985 | 208,816 | 205,291 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 1,949,352 | $ | 1,976,574 | $ | 1,966,752 | $ | 1,929,750 | $ | 1,892,609 | |||||||||||||||||||||||||||||||||||||||||||||
Net interest income (TE) and spread | $ | 19,423 | 4.23 | % | $ | 19,676 | 4.27 | % | $ | 19,565 | 4.34 | % | $ | 20,496 | 4.55 | % | $ | 19,856 | 4.50 | % | |||||||||||||||||||||||||||||||||||
Net interest margin | 4.34 | % | 4.38 | % | 4.44 | % | 4.65 | % | 4.61 | % | |||||||||||||||||||||||||||||||||||||||||||||
Core net interest margin (Non-GAAP)(*) | 4.17 | % | 4.21 | % | 4.32 | % | 4.44 | % | 4.42 | % | |||||||||||||||||||||||||||||||||||||||||||||
(*) See reconciliation of Non-GAAP financial measures on pages 13-15. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
12
MIDSOUTH BANCORP, INC. and SUBSIDIARIES | ||||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures (unaudited) | ||||||||||||||||||||
(in thousands except per share data) | ||||||||||||||||||||
Certain financial information included in the earnings release and the associated Condensed Consolidated Financial Information (unaudited) is determined by methods other than in accordance with GAAP. We are providing disclosure of the reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures. "Tangible common equity" is defined as total common equity reduced by intangible assets. "Core net interest margin" is defined as reported net interest margin less purchase accounting adjustments. "Annualized return on average assets, operating" is defined as net earnings available to common shareholders adjusted for specified one-time items divided by average assets. "Annualized return on average common equity, operating" is defined as net earnings available to common shareholders adjusted for specified one-time items divided by average common equity. "Annualized return on average tangible common equity, operating" is defined as net earnings available to common shareholders adjusted for specified one-time items divided by average tangible common equity. "Pre-tax, pre-provision annualized return on average assets, operating" is defined as pre-tax, pre-provision earnings adjusted for specified one-time items divided by average assets. "Tangible book value per common share" is defined as tangible common equity divided by total common shares outstanding. "Diluted earnings per share, operating" is defined as net earnings available to common shareholders adjusted for specified one-time items divided by diluted weighted-average shares. The GAAP-based efficiency ratio is measured as noninterest expense as a percentage of net interest income plus noninterest income. The non-GAAP efficiency ratio excludes specified one-time items in addition to securities gains and losses and gains and losses on the sale/valuation of other real estate owned and other assets repossessed. | ||||||||||||||||||||
We use non-GAAP measures because we believe they are useful for evaluating our financial condition and performance over periods of time, as well as in managing and evaluating our business and in discussions about our performance. We also believe these non-GAAP financial measures provide users of our financial information with a meaningful measure for assessing our financial condition as well as comparison to financial results for prior periods. These results should not be viewed as a substitute for results determined in accordance with GAAP, and are not necessarily comparable to non-GAAP performance measures that other companies may use. | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
2015 | 2015 | 2015 | 2014 | 2014 | ||||||||||||||||
Average Balance Sheet Data | ||||||||||||||||||||
Total average assets | A | $ | 1,949,352 | $ | 1,976,574 | $ | 1,966,752 | $ | 1,929,750 | $ | 1,892,609 | |||||||||
Total equity | $ | 214,623 | $ | 212,112 | $ | 211,985 | $ | 208,816 | $ | 205,291 | ||||||||||
Less preferred equity | 41,157 | 41,226 | 41,347 | 41,386 | 41,436 | |||||||||||||||
Total common equity | B | $ | 173,466 | $ | 170,886 | $ | 170,638 | $ | 167,430 | $ | 163,855 | |||||||||
Less intangible assets | 48,310 | 48,587 | 48,860 | 49,139 | 49,417 | |||||||||||||||
Tangible common equity | C | $ | 125,156 | $ | 122,299 | $ | 121,778 | $ | 118,291 | $ | 114,438 | |||||||||
13
MIDSOUTH BANCORP, INC. and SUBSIDIARIES | ||||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures (unaudited) (continued) | ||||||||||||||||||||
(in thousands except per share data) | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
Core Net Interest Margin | 2015 | 2015 | 2015 | 2014 | 2014 | |||||||||||||||
Net interest income (TE) | $ | 19,423 | $ | 19,676 | $ | 19,565 | $ | 20,496 | $ | 19,856 | ||||||||||
Less purchase accounting adjustments | (689 | ) | (678 | ) | (465 | ) | (894 | ) | (750 | ) | ||||||||||
Net interest income, excluding purchase accounting adjustments | D | $ | 18,734 | $ | 18,998 | $ | 19,100 | $ | 19,602 | $ | 19,106 | |||||||||
Total average earnings assets | $ | 1,776,649 | $ | 1,803,295 | $ | 1,786,397 | $ | 1,746,855 | $ | 1,708,524 | ||||||||||
Add average balance of loan valuation discount | 4,269 | 4,888 | 5,179 | 5,764 | 6,498 | |||||||||||||||
Average earnings assets, excluding loan valuation discount | E | $ | 1,780,918 | $ | 1,808,183 | $ | 1,791,576 | $ | 1,752,619 | $ | 1,715,022 | |||||||||
Core net interest margin | D/E | 4.17 | % | 4.21 | % | 4.32 | % | 4.44 | % | 4.42 | % | |||||||||
Three Months Ended | ||||||||||||||||||||
September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
Return Ratios | 2015 | 2015 | 2015 | 2014 | 2014 | |||||||||||||||
Net earnings available to common shareholders | $ | 2,417 | $ | 4,927 | $ | 1,318 | $ | 3,490 | $ | 4,298 | ||||||||||
Gain on sales of securities, after-tax | — | (733 | ) | (75 | ) | — | — | |||||||||||||
Efficiency consultant expenses, after-tax | — | — | — | 101 | 130 | |||||||||||||||
Loss on disposal of fixed assets, after-tax | — | — | — | — | 256 | |||||||||||||||
Loss on redemption of Trust Preferred Securities, after-tax | — | — | — | — | 168 | |||||||||||||||
Gain on sale of other real estate owned, after-tax | — | — | — | — | (700 | ) | ||||||||||||||
Income from death benefit on bank owned life insurance | — | (160 | ) | — | — | — | ||||||||||||||
Net earnings available to common shareholders, operating | F | $ | 2,417 | $ | 4,034 | $ | 1,243 | $ | 3,591 | $ | 4,152 | |||||||||
Earnings before income taxes | $ | 3,617 | $ | 7,442 | $ | 1,937 | $ | 5,183 | $ | 6,674 | ||||||||||
Gain on sales of securities | — | (1,128 | ) | (115 | ) | — | — | |||||||||||||
Efficiency consultant expenses | — | — | — | 156 | 200 | |||||||||||||||
Loss on disposal of fixed assets | — | — | — | — | 394 | |||||||||||||||
Loss on redemption of Trust Preferred Securities | — | — | — | — | 258 | |||||||||||||||
Gain on sale of other real estate owned | — | — | — | — | (1,079 | ) | ||||||||||||||
Income from death benefit on bank owned life insurance | — | (160 | ) | — | — | — | ||||||||||||||
Provision for loan losses | 3,800 | 1,100 | 6,000 | 2,700 | 1,175 | |||||||||||||||
Pre-tax, pre-provision earnings, operating | G | $ | 7,417 | $ | 7,254 | $ | 7,822 | $ | 8,039 | $ | 7,622 | |||||||||
Annualized return on average assets, operating | F/A | 0.49 | % | 0.82 | % | 0.26 | % | 0.74 | % | 0.87 | % | |||||||||
Annualized return on average common equity, operating | F/B | 5.53 | % | 9.47 | % | 2.95 | % | 8.51 | % | 10.05 | % | |||||||||
Annualized return on average tangible common equity, operating | F/C | 7.66 | % | 13.23 | % | 4.14 | % | 12.04 | % | 14.39 | % | |||||||||
Pre-tax, pre-provision annualized return on average assets, operating | G/A | 1.51 | % | 1.47 | % | 1.61 | % | 1.65 | % | 1.60 | % | |||||||||
14
MIDSOUTH BANCORP, INC. and SUBSIDIARIES | ||||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures (unaudited) (continued) | ||||||||||||||||||||
(in thousands except per share data) | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
Per Common Share Data | 2015 | 2015 | 2015 | 2014 | 2014 | |||||||||||||||
Book value per common share | $ | 15.21 | $ | 15.04 | $ | 14.92 | $ | 14.78 | $ | 14.52 | ||||||||||
Effect of intangible assets per share | 4.24 | 4.26 | 4.29 | 4.32 | 4.35 | |||||||||||||||
Tangible book value per common share | $ | 10.97 | $ | 10.78 | $ | 10.63 | $ | 10.46 | $ | 10.17 | ||||||||||
Diluted earnings per share | $ | 0.21 | $ | 0.42 | $ | 0.12 | $ | 0.3 | $ | 0.37 | ||||||||||
Effect of gain on sales of securities, after-tax | — | (0.06 | ) | (0.01 | ) | — | — | |||||||||||||
Effect of efficiency consultant expenses, after-tax | — | — | — | 0.01 | 0.01 | |||||||||||||||
Effect of loss on disposal of fixed assets, after-tax | — | — | — | — | 0.02 | |||||||||||||||
Effect of loss on redemption of Trust Preferred Securities, after-tax | — | — | — | — | 0.02 | |||||||||||||||
Effect of gain on sale of other real estate, after-tax | — | — | — | — | (0.06 | ) | ||||||||||||||
Effect of income from death benefit on bank owned life insurance | — | (0.01 | ) | — | — | — | ||||||||||||||
Diluted earnings per share, operating | $ | 0.21 | $ | 0.35 | $ | 0.11 | $ | 0.31 | $ | 0.36 | ||||||||||
Three Months Ended | ||||||||||||||||||||
September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
Efficiency Ratio | 2015 | 2015 | 2015 | 2014 | 2014 | |||||||||||||||
Net interest income | $ | 19,141 | $ | 19,381 | $ | 19,257 | $ | 20,160 | $ | 19,512 | ||||||||||
Noninterest income | $ | 4,840 | $ | 6,166 | $ | 4,967 | $ | 5,050 | $ | 6,194 | ||||||||||
Income from death benefit on bank owned life insurance | — | (160 | ) | — | — | — | ||||||||||||||
Gain on sales of securities | — | (1,128 | ) | (115 | ) | — | — | |||||||||||||
Net gain on sale of other real estate owned and other assets repossessed | (3 | ) | — | (19 | ) | — | (1,079 | ) | ||||||||||||
Noninterest income (non-GAAP) | $ | 4,837 | $ | 4,878 | $ | 4,833 | $ | 5,050 | $ | 5,115 | ||||||||||
Total revenue | H | $ | 23,981 | $ | 25,547 | $ | 24,224 | $ | 25,210 | $ | 25,706 | |||||||||
Total revenue (non-GAAP) | I | $ | 23,978 | $ | 24,259 | $ | 24,090 | $ | 25,210 | $ | 24,627 | |||||||||
Noninterest expense | J | $ | 16,564 | $ | 17,005 | $ | 16,287 | $ | 17,327 | $ | 17,857 | |||||||||
Efficiency consultant expenses | — | — | — | (156 | ) | (200 | ) | |||||||||||||
Loss on disposal of fixed assets | — | — | — | — | (394 | ) | ||||||||||||||
Loss on redemption of Trust Preferred Securities | — | — | — | — | (258 | ) | ||||||||||||||
Net loss on valuation of other real estate owned | (86 | ) | (5 | ) | (31 | ) | (77 | ) | — | |||||||||||
Noninterest expense (non-GAAP) | K | $ | 16,478 | $ | 17,000 | $ | 16,256 | $ | 17,094 | $ | 17,005 | |||||||||
Efficiency ratio (GAAP) | J/H | 69.07 | % | 66.56 | % | 67.23 | % | 68.73 | % | 69.47 | % | |||||||||
Efficiency ratio (non-GAAP) | K/I | 68.72 | % | 70.08 | % | 67.48 | % | 67.81 | % | 69.05 | % | |||||||||
15