First Guaranty Bancshares, Inc. - FORM 8-K - EX-99.1 - PRESS RELEASE DATED FEBRUARY 3, 2021 - February 3, 2021

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EXHIBIT 99.1
FEBRUARY 3, 2021
NEWS FOR IMMEDIATE RELEASE
CONTACT: ERIC J. DOSCH, CFO
985.375.0308
 
First Guaranty Bancshares, Inc. Announces Fourth Quarter 2020 Results

Hammond, Louisiana, February 3, 2021 – First Guaranty Bancshares, Inc. ("First Guaranty") (NASDAQ: FGBI), the holding company for First Guaranty Bank, announced its unaudited financial results for the quarter and year ending December 31, 2020.
 
After being named the Best Small Bank in the United States by Newsweek/Lending Tree, First Guaranty closed out the year with very strong financial results. Earnings per share for 2020 increased to $2.09 compared to $1.47 for 2019 as net income increased to $20,318,000 as opposed to $14,241,000 for 2019, an increase of 43%. The most impressive aspect of those earnings numbers is that the $20,318,000 in net income was recorded after an ALLL provision of $14,877,000. This provision was due to the increased risk and uncertainty in the loan portfolio related to the ongoing Covid pandemic, including the industries and portfolio segments considered high risk due to the pandemic and not because of any specific, identified loan. During the course of the year, budgeted provisions of $5,877,000 were made, and, because of the continued uncertainties of Covid and the Covid effects on the economy, an additional $9,000,000 provision was added. Since the beginning of the Covid crisis, it has been the opinion of Management that deterioration in the loan program would accelerate if the crisis continued through year-end 2020. Although 2020 turned out to be a banner year, this additional provision was necessary due to the continued uncertainty that could manifest in 2021.

Loan demand has been and continues to be strong. Total loans increased to $1,844,135,000 as of December 31, 2020 compared to $1,525,490,000 as of December 31, 2019. This is an increase of 21%. If the PPP loans are removed, the increase, year over year, is still 15%.
Total assets increased to $2,473,078,000 from $2,117,216,000, an increase of 17% year over year.

In a year of great adversity, First Guaranty Bancshares, Inc. has not just survived; but, has excelled. The result is a much stronger, more profitable, and safer investment. 110 consecutive quarterly dividends have been paid. Shareholder value has consistently continued to be enhanced.

Thank you for your support.

Sincerely,
Alton B. Lewis
President and CEO
First Guaranty, Bancshares, Inc. 
About First Guaranty
First Guaranty, a Louisiana-based company, has approximately $2.5 billion in assets as of December 31, 2020 and provides personalized commercial banking services through 33 banking facilities located across Louisiana and Texas. For more information, visit www.fgb.net.
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. Such forward looking statements may be identified by reference to a future period or periods, or by the use of forward looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of those terms. Forward looking statements are subject to numerous risks and uncertainties, as described in our SEC filings, including, but not limited to, those related to the real estate and economic environment, particularly in the market areas in which First Guaranty operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity.
First Guaranty wishes to caution readers not to place undue reliance on any such forward looking statements, which speak only as of the date made. First Guaranty wishes to advise readers that the factors listed above could affect First Guaranty's financial performance and could cause First Guaranty's actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. First Guaranty does not undertake and specifically declines any obligation to publicly release the results of any revisions, which may be made to any forward looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.




FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS (unaudited)
(in thousands, except share data)December 31, 2020December 31, 2019
Assets  
Cash and cash equivalents:  
Cash and due from banks$298,903 $66,511 
Federal funds sold702 914 
Cash and cash equivalents299,605 67,425 
Investment securities:  
Available for sale, at fair value238,548 339,937 
Held to maturity, at cost (estimated fair value of $0 and $86,817, respectively)— 86,579 
Investment securities238,548 426,516 
Federal Home Loan Bank stock, at cost3,351 3,308 
Loans held for sale— — 
Loans, net of unearned income1,844,135 1,525,490 
Less: allowance for loan losses24,518 10,929 
Net loans1,819,617 1,514,561 
Premises and equipment, net59,892 56,464 
Goodwill12,900 12,942 
Intangible assets, net6,587 7,166 
Other real estate, net2,240 4,879 
Accrued interest receivable11,933 8,412 
Other assets18,405 15,543 
Total Assets$2,473,078 $2,117,216 
Liabilities and Shareholders' Equity  
Deposits:  
Noninterest-bearing demand$411,416 $325,888 
Interest-bearing demand860,394 635,942 
Savings168,879 135,156 
Time725,629 756,027 
Total deposits2,166,318 1,853,013 
Short-term advances from Federal Home Loan Bank50,000 13,079 
Repurchase agreements6,121 6,840 
Accrued interest payable5,292 6,047 
Long-term advances from Federal Home Loan Bank3,366 3,533 
Senior long-term debt42,366 48,558 
Junior subordinated debentures14,777 14,737 
Other liabilities6,247 5,374 
Total Liabilities2,294,487 1,951,181 
Shareholders' Equity  
Common stock:  
$1 par value - authorized 100,600,000 shares; issued 9,741,253 shares9,741 9,741 
Surplus110,836 110,836 
Retained earnings57,367 43,283 
Accumulated other comprehensive income (loss)647 2,175 
Total Shareholders' Equity178,591 166,035 
Total Liabilities and Shareholders' Equity$2,473,078 $2,117,216 
See Notes to Consolidated Financial Statements  




FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY       
CONSOLIDATED STATEMENTS OF INCOME (unaudited)        
 Three Months Ended December 31,Years Ended December 31,
(in thousands, except share data)2020201920202019
Interest Income:   
Loans (including fees)$23,388 $21,221 $90,808 $78,886 
Deposits with other banks56 495 404 2,956 
Securities (including FHLB stock)1,309 2,419 9,471 9,800 
Federal funds sold1 — 1 1 
Total Interest Income24,754 24,135 100,684 91,643 
Interest Expense:    
Demand deposits1,444 2,301 6,089 10,447 
Savings deposits58 120 268 527 
Time deposits3,771 4,420 16,908 17,141 
Borrowings616 625 2,752 1,851 
Total Interest Expense5,889 7,466 26,017 29,966 
Net Interest Income18,865 16,669 74,667 61,677 
Less: Provision for loan losses10,251 712 14,877 4,860 
Net Interest Income after Provision for Loan Losses8,614 15,957 59,790 56,817 
Noninterest Income:    
Service charges, commissions and fees719 880 2,571 2,808 
ATM and debit card fees789 568 3,022 2,254 
Net gains (losses) on securities12,160 230 14,791 (157)
Net gains on sale of loans80 5 1,054 1,376 
Other730 490 2,342 2,018 
Total Noninterest Income14,478 2,173 23,780 8,299 
Noninterest Expense:    
Salaries and employee benefits7,411 6,899 29,600 25,019 
Occupancy and equipment expense2,093 1,658 7,709 6,096 
Other5,918 4,522 20,724 16,104 
Total Noninterest Expense15,422 13,079 58,033 47,219 
Income Before Income Taxes7,670 5,051 25,537 17,897 
Less: Provision for income taxes1,543 1,002 5,219 3,656 
Net Income$6,127 $4,049 $20,318 $14,241 
Per Common Share:    
Earnings$0.63 $0.42 $2.09 $1.47 
Cash dividends paid $0.16 $0.16 $0.64 $0.60 
Weighted Average Common Shares Outstanding9,741,253 9,718,895 9,741,253 9,695,131 
 See Notes to Consolidated Financial Statements                      




              FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY       
CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited)       
 Three Months Ended December 31, 2020Three Months Ended December 31, 2019
(in thousands except for %)Average BalanceInterestYield/Rate (5)Average BalanceInterestYield/Rate (5)
Assets      
Interest-earning assets:      
Interest-earning deposits with banks$231,305 $56 0.10 %$126,864 $495 1.55 %
Securities (including FHLB stock)263,164 1,309 1.98 %349,862 2,419 2.74 %
Federal funds sold673 1 0.59 %961 — — %
Loans held for sale 154 1 2.87 %50 — — %
Loans, net of unearned income1,808,892 23,387 5.14 %1,400,584 21,221 6.01 %
Total interest-earning assets2,304,188 $24,754 4.27 %1,878,321 $24,135 5.10 %
Noninterest-earning assets:      
Cash and due from banks13,124 21,250   
Premises and equipment, net59,067 51,835   
Other assets88,284 20,322   
Total Assets$2,464,663   $1,971,728   
Liabilities and Shareholders' Equity      
Interest-bearing liabilities:      
Demand deposits$810,807 $1,444 0.71 %$607,538 $2,301 1.50 %
Savings deposits174,942 58 0.13 %128,950 120 0.37 %
Time deposits733,570 3,771 2.05 %699,999 4,420 2.51 %
Borrowings118,581 616 2.07 %61,136 625 4.06 %
Total interest-bearing liabilities1,837,900 $5,889 1.27 %1,497,623 $7,466 1.98 %
Noninterest-bearing liabilities:      
Demand deposits428,781 297,562   
Other13,279 12,407   
Total Liabilities2,279,960   1,807,592   
Shareholders' equity184,703 164,136   
Total Liabilities and Shareholders' Equity$2,464,663   $1,971,728   
Net interest income $18,865   $16,669  
Net interest rate spread (1)  3.00 %  3.12 %
Net interest-earning assets (2)$466,288  $380,698  
Net interest margin (3), (4)  3.26 %  3.52 %
Average interest-earning assets to interest-bearing liabilities  125.37 %  125.42 %
(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3)Net interest margin represents net interest income divided by average total interest-earning assets.
(4)The tax adjusted net interest margin was 3.26% and 3.53% for the above periods ended December 31, 2020 and 2019 respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended December 31, 2020 and 2019 respectively.
(5)Annualized.




              FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY       
CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited)       
 Year Ended December 31, 2020Year Ended December 31, 2019
(in thousands except for %)Average BalanceInterestYield/Rate Average BalanceInterestYield/Rate
Assets      
Interest-earning assets:      
Interest-earning deposits with banks$182,339 $404 0.22 %$144,298 $2,956 2.05 %
Securities (including FHLB stock)380,991 9,471 2.49 %349,247 9,800 2.81 %
Federal funds sold678 1 0.08 %592 1 0.25 %
Loans held for sale 377 21 5.56 %324 24 7.41 %
Loans, net of unearned income1,662,875 90,787 5.46 %1,315,524 78,862 5.99 %
Total interest-earning assets2,227,260 $100,684 4.52 %1,809,985 $91,643 5.06 %
      
Noninterest-earning assets:
Cash and due from banks12,955 11,951   
Premises and equipment, net58,411 45,037   
Other assets49,859 15,256   
Total Assets$2,348,485   $1,882,229   
Liabilities and Shareholders' Equity      
Interest-bearing liabilities:      
Demand deposits$722,433 $6,089 0.84 %$592,113 $10,447 1.76 %
Savings deposits163,332 268 0.16 %115,682 527 0.46 %
Time deposits767,075 16,908 2.20 %703,685 17,141 2.44 %
Borrowings110,292 2,752 2.50 %40,766 1,851 4.54 %
Total interest-bearing liabilities1,763,132 $26,017 1.48 %1,452,246 $29,966 2.06 %
Noninterest-bearing liabilities:      
Demand deposits393,734 262,379   
Other12,714 9,204   
Total Liabilities2,169,580   1,723,829   
Shareholders' equity178,905 158,400   
Total Liabilities and Shareholders' Equity$2,348,485   $1,882,229   
Net interest income $74,667   $61,677  
Net interest rate spread (1)  3.04 %3.00 %
Net interest-earning assets (2)$464,128  $357,739  
Net interest margin (3), (4)  3.35 %3.41 %
Average interest-earning assets to interest-bearing liabilities  126.32 %124.63 %
(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3)Net interest margin represents net interest income divided by average total interest-earning assets.
(4)The tax adjusted net interest margin was 3.36% and 3.42% for the above periods ended December 31, 2020 and 2019 respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended December 31, 2020 and 2019 respectively.



The following table summarizes the components of First Guaranty's loan portfolio as of December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020:
 December 31, 2020September 30, 2020June 30, 2020March 31, 2020
(in thousands except for %)BalanceAs % of CategoryBalanceAs % of CategoryBalanceAs % of CategoryBalanceAs % of Category
Real Estate:          
Construction & land development$150,841 8.2 %$153,969 8.6 %$128,051 7.8 %$125,201 8.1 %
Farmland26,880 1.4 %27,732 1.5 %25,691 1.6 %21,840 1.4 %
1- 4 Family271,236 14.7 %273,687 15.3 %283,162 17.2 %286,157 18.5 %
Multifamily45,932 2.5 %41,295 2.3 %25,997 1.6 %27,948 1.8 %
Non-farm non-residential824,137 44.6 %761,674 42.4 %671,969 40.8 %654,081 42.3 %
Total Real Estate1,319,026 71.4 %1,258,357 70.1 %1,134,870 69.0 %1,115,227 72.1 %
Non-Real Estate:
Agricultural28,335 1.5 %35,625 2.0 %33,884 2.0 %25,320 1.6 %
Commercial and industrial353,028 19.1 %378,926 21.1 %366,413 22.3 %298,185 19.3 %
Consumer and other148,783 8.0 %121,226 6.8 %111,293 6.7 %108,922 7.0 %
Total Non-Real Estate530,146 28.6 %535,777 29.9 %511,590 31.0 %432,427 27.9 %
Total loans before unearned income1,849,172 100.0 %1,794,134 100.0 %1,646,460 100.0 %1,547,654 100.0 %
Unearned income(5,037) (5,418) (5,737) (3,522) 
Total loans net of unearned income$1,844,135  $1,788,716  $1,640,723  $1,544,132  



The table below sets forth the amounts and categories of our nonperforming assets at the dates indicated.
(in thousands)December 31, 2020September 30, 2020June 30, 2020March 31, 2020
Nonaccrual loans:    
Real Estate:    
Construction and land development$621 $663 $968 $901 
Farmland857 857 886 855 
1- 4 family 2,227 5,160 5,744 4,347 
Multifamily— — — — 
Non-farm non-residential7,449 13,571 8,082 4,638 
Total Real Estate11,154 20,251 15,680 10,741 
Non-Real Estate:    
Agricultural3,472 3,934 4,895 4,480 
Commercial and industrial701 792 908 412 
Consumer and other249 313 271 273 
Total Non-Real Estate4,422 5,039 6,074 5,165 
Total nonaccrual loans15,576 25,290 21,754 15,906 
Loans 90 days and greater delinquent & accruing:    
Real Estate:    
Construction and land development1,000 520 311 414 
Farmland— 429 53 — 
1- 4 family 4,980 2,677 2,088 1,203 
Multifamily366 370 — — 
Non-farm non-residential4,699 843 5,219 5,056 
Total Real Estate11,045 4,839 7,671 6,673 
Non-Real Estate:    
Agricultural67 144 332 46 
Commercial and industrial1,856 599 763 139 
Consumer and other123 146 63 58 
Total Non-Real Estate2,046 889 1,158 243 
Total loans 90 days and greater delinquent & accruing13,091 5,728 8,829 6,916 
Total non-performing loans28,667 31,018 30,583 22,822 
Real Estate Owned:    
Construction and land development311 486 606 669 
Farmland— — — — 
1- 4 family131 147 147 205 
Multifamily— — — — 
Non-farm non-residential1,798 2,708 3,441 3,511 
Total Real Estate Owned2,240 3,341 4,194 4,385 
Total non-performing assets$30,907 $34,359 $34,777 $27,207 
Non-performing assets to total loans1.68 %1.92 %2.12 %1.76 %
Non-performing assets to total assets1.25 %1.37 %1.43 %1.21 %
Non-performing loans to total loans1.55 %1.73 %1.86 %1.48 %



Non-GAAP Financial Measures
 
Our accounting and reporting policies conform to accounting principles generally accepted in the United States, or GAAP, and the prevailing practices in the banking industry. However, we also evaluate our performance based on certain additional metrics. Tangible book value per share and the ratio of tangible equity to tangible assets are not financial measures recognized under GAAP and, therefore, are considered non-GAAP financial measures.
Our management, banking regulators, many financial analysts and other investors use these non-GAAP financial measures to compare the capital adequacy of banking organizations with significant amounts of preferred equity and/or goodwill or other intangible assets, which typically stem from the use of the purchase accounting method of accounting for mergers and acquisitions. Tangible equity, tangible assets, tangible book value per share or related measures should not be considered in isolation or as a substitute for total shareholders' equity, total assets, book value per share or any other measure calculated in accordance with GAAP. Moreover, the manner in which we calculate tangible equity, tangible assets, tangible book value per share and any other related measures may differ from that of other companies reporting measures with similar names.
The following table reconciles, as of the dates set forth below, shareholders' equity (on a GAAP basis) to tangible equity and total assets (on a GAAP basis) to tangible assets and calculates our tangible book value per share.
 At December 31,
(in thousands except for share data and %)20202019201820172016
Tangible Common Equity     
Total shareholders' equity$178,591 $166,035 $147,284 $143,983 $124,349 
Adjustments:
Preferred— — — — — 
Goodwill12,900 12,942 3,472 3,472 1,999 
Acquisition intangibles5,815 6,527 2,704 3,249 978 
Tangible common equity$159,876 $146,566 $141,108 $137,262 $121,372 
Common shares outstanding9,741,253 9,741,253 9,687,123 9,687,123 9,205,635 
Book value per common share$18.33 $17.04 $15.20 $14.86 $13.51 
Tangible book value per common share$16.41 $15.05 $14.57 $14.17 $13.18 
Tangible Assets
Total Assets$2,473,078 $2,117,216 $1,817,211 $1,750,430 $1,500,946 
Adjustments:
Goodwill12,900 12,942 3,472 3,472 1,999 
Acquisition intangibles5,815 6,527 2,704 3,249 978 
Tangible Assets$2,454,363 $2,097,747 $1,811,035 $1,743,709 $1,497,969 
Tangible common equity to tangible assets6.51 %6.99 %7.79 %7.87 %8.10 %


First Guaranty Bancshares, Inc. Reports