First Quarter 2023 Highlights:
- Net income of $26.3 million, $1.03 per diluted share
- Net interest margin of 4.39%
- Return on average total assets of 1.44%
- Return on average stockholders’ equity of 13.37%
- Loan growth of 10.1% annualized
- 20.3% fee revenue to total revenue
DENVER--(BUSINESS WIRE)-- FirstSun Capital Bancorp (“FirstSun”) (OTCQX: FSUN) reported net income of $26.3 million for the first quarter of 2023 compared to net income of $7.7 million for the first quarter of 2022. Earnings per diluted share were $1.03 for the first quarter of 2023 compared to $0.41 for the first quarter of 2022. Earnings for the first quarter of 2022 were impacted by $0.3 million of merger costs, net of tax, or $0.01 per diluted share.
Neal Arnold, FirstSun’s President and Chief Executive Officer, commented, “We are very pleased with our strong operating results this quarter amidst a more challenging banking environment. Highlights this quarter include net interest margin of 4.39%, steady loan growth, deposit stability and continued credit quality strength. Our industry has recently been reminded of the benefits of a well-diversified and balanced business mix as well as the importance of asset/liability management. We believe our diversified business model with its emphasis across our commercial and industrial business and consumer clients, our balanced mix of spread and service-based revenues, our geographic diversity, along with our disciplined and conservative balance sheet management provides a stable platform for responsible growth and favorable performance even in difficult times. Additionally, we believe our strong capital base, our granular and stable deposit base, our securities portfolio positioning and our overall asset sensitive profile provides us with flexibility as the competition for deposits increases in this environment.”
First Quarter 2023 Results
Net income totaled $26.3 million, or $1.03 per diluted share, during the first quarter of 2023, compared to $24.6 million, or $0.96 per diluted share, during the prior quarter. The return on average total assets was 1.44% in the first quarter of 2023, compared to 1.38% in the prior quarter, and the return on average stockholders’ equity was 13.37% in the first quarter of 2023, compared to 12.89% in the prior quarter.
Net Interest Income and Net Interest Margin
Net interest income totaled $74.1 million during the first quarter of 2023, an increase of $0.8 million compared to the prior quarter. Our net interest margin decreased 6 basis points to 4.39% compared to the prior quarter. Results in the first quarter of 2023, compared to the prior quarter, were driven by an increase of 45 basis points in yield on earning assets, offset by an increase of 71 basis points in the cost of interest-bearing liabilities.
Average loans increased by $0.2 billion in the first quarter of 2023, compared to the prior quarter. Loan yield increased by 42 basis points to 5.88% in the first quarter of 2023, compared to the prior quarter, primarily due to the rising interest rate environment and its impact on variable rate loans in the loan portfolio and higher yields on new originations. Average interest-bearing deposits increased $0.3 billion in the first quarter of 2023, compared to the prior quarter. Total cost of deposits increased by 74 basis points to 1.39% in the first quarter of 2023, compared to the prior quarter, primarily due to an increase in deposit pricing as a result of the rising interest rate environment. Average FHLB borrowings decreased $17.8 million in the first quarter of 2023, compared to the prior quarter. The cost of FHLB borrowings increased by 88 basis points to 4.68% in the first quarter of 2023, compared to the prior quarter, primarily due to the rising interest rate environment.
Asset Quality and Provision for Credit Losses
The provision for credit losses totaled $3.4 million during the first quarter of 2023, a decrease of $2.2 million from the $5.6 million in the prior quarter, primarily due to slower loan growth and generally neutral macroeconomic indicators relative to the prior quarter.
Net charge-offs during the first quarter of 2023 were $0.1 million, resulting in a negligible ratio of net charge-offs to average loans annualized, compared to net charge-offs (recoveries) of $(0.6) million, or a ratio of net charge-offs (recoveries) to average loans of (0.04)% annualized, in the prior quarter. The allowance for credit losses as a percentage of total loans was 1.23% at March 31, 2023, or an increase of 11 basis points from the prior quarter.
On January 1, 2023, we adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), which increased our allowance for credit losses as a percentage of total loans to 1.20% at adoption, or an eight basis point increase from 1.12% at December 31, 2022. The increase in our allowance for credit losses was a result of changing from an “incurred loss” model, which encompasses allowances for current known and incurred losses within the portfolio, to an “expected loss” model, which encompasses allowances for losses expected to be recognized over the life of the portfolio.
The ratio of nonperforming assets to total assets was 0.51% at March 31, 2023, compared to 0.48% at December 31, 2022.
Noninterest Income
Noninterest income totaled $18.9 million during the first quarter of 2023, an increase of $0.3 million from the prior quarter. Mortgage banking income increased $1.2 million during the first quarter of 2023, primarily due to an increase in fair value of our interest rate lock commitments from the prior quarter. Total originations of mortgage loans held-for-sale increased by $9.9 million, or 5.3%, in the first quarter of 2023 from the prior quarter. Other noninterest income decreased $0.8 million during the first quarter of 2023, primarily due to a decrease in loan syndication fees and customer accommodation swap fees. Noninterest income as a percentage of total revenue totaled 20.3%, which is unchanged from the prior quarter.
Noninterest Expense
Noninterest expense totaled $56.3 million during the first quarter of 2023, an increase of $0.8 million from the prior quarter. Salaries and employee benefits increased $2.7 million from the prior quarter primarily due to higher benefit costs generally incurred in the first quarter of each year. Occupancy and equipment expenses increased $0.5 million from the prior quarter primarily due to the impact of adoption in the prior quarter of ASU 2016-02, Leases. Amortization of intangible assets decreased $1.0 million from the prior quarter. Other noninterest expenses decreased $1.3 million from the prior quarter primarily due to data processing and loan appraisal, servicing, and collection expenses as we experienced a lesser level of transaction volume in the first quarter of 2023.
The efficiency ratio for the first quarter of 2023 was 60.47% compared to 60.33% in the prior quarter.
Tax Rate
The effective tax rate was 21.4% in the first quarter of 2023, compared to 20.4% in the prior quarter.
Loans
Total loans were $6.1 billion at March 31, 2023, compared to $5.9 billion at December 31, 2022, an increase of $149.1 million in the first quarter of 2023, or 10.1% on an annualized basis, resulting primarily from growth in commercial and industrial and residential real estate balances.
Deposits
Average deposits were $5.8 billion for the first quarter of 2023, compared to $5.7 billion for the prior quarter, an increase of $0.1 billion in the first quarter of 2023, or 10.2% on an annualized basis. Noninterest-bearing deposit accounts represented 29.4% of total deposits at March 31, 2023 and the loan-to-deposit ratio was 101.1% at March 31, 2023.
Total uninsured and uncollateralized deposits were approximately 25.5% at March 31, 2023, compared to 41.6% at December 31, 2022.
Capital
Capital ratios remain strong and above “well-capitalized” thresholds. As of March 31, 2023, our common equity tier 1 risk-based capital ratio was 10.11%, total risk-based capital ratio was 12.19% and tier 1 leverage ratio was 9.86%. Book value per common share was $32.06 at March 31, 2023, an increase of $0.98 from December 31, 2022. Tangible book value per common share, a non-GAAP financial measure, was $27.72 at March 31, 2023, an increase of $1.03 from December 31, 2022.
Non-GAAP Financial Measures
This press release (including the tables within the “Non-GAAP Financial Measures and Reconciliations” section) contains financial measures determined by methods other than in accordance with principles generally accepted in the United States (“GAAP”). FirstSun management uses these non-GAAP financial measures in their analysis of FirstSun’s performance and the efficiency of its operations. Management believes these non-GAAP measures provide a greater understanding of ongoing operations, enhance comparability of results with prior periods and demonstrate the effects of significant items in the current period. FirstSun believes a meaningful analysis of its financial performance requires an understanding of the factors underlying that performance. FirstSun management believes investors may find these non-GAAP financial measures useful. These non-GAAP financial measures, however, should not be viewed as a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Below is a listing of the non-GAAP measures used in this press release:
- Tangible common stockholders’ equity;
- Tangible assets;
- Tangible common stockholders’ equity to tangible assets;
- Tangible common stockholders’ equity to tangible assets, reflecting net unrealized losses on HTM securities, net of tax;
- Tangible book value per common share;
- Net income excluding merger costs;
- Return on average total assets excluding merger costs;
- Return on average stockholders’ equity excluding merger costs;
- Efficiency ratio excluding merger related expenses;
- Diluted earnings per share excluding merger related costs; and
- Fully tax equivalent (“FTE”) net interest income and net interest margin on FTE basis.
The tables beginning within the “Non-GAAP Financial Measures and Reconciliations” section provide a reconciliation of each non-GAAP financial measure contained in this press release to the most comparable GAAP equivalent.
About FirstSun Capital Bancorp
FirstSun Capital Bancorp, headquartered in Denver, Colorado, is the financial holding company for Sunflower Bank, N.A., which operates as Sunflower Bank, First National 1870 and Guardian Mortgage. Sunflower Bank provides a full range of relationship-focused services to meet personal, business and wealth management financial objectives, with a branch network in five states and mortgage capabilities in 43 states. FirstSun had total consolidated assets of $7.6 billion as of March 31, 2023.
First National 1870 and Guardian Mortgage are divisions of Sunflower Bank, N.A. To learn more, visit ir.firstsuncb.com, SunflowerBank.com, FirstNational1870.com or GuardianMortgageOnline.com.
Summary Data:
As of and for the quarter ended |
|||||||||||
($ in thousands, except per share amounts) |
March 31, 2023 |
December 31, 2022 |
March 31, 2022 |
||||||||
Net interest income |
$ |
74,117 |
$ |
73,276 |
$ |
41,285 |
|||||
Provision for credit losses |
3,360 |
5,600 |
3,700 |
||||||||
Noninterest income |
18,931 |
18,618 |
23,693 |
||||||||
Noninterest expense |
56,266 |
55,443 |
52,467 |
||||||||
Income before income taxes |
33,422 |
30,851 |
8,811 |
||||||||
Provision for income taxes |
7,141 |
6,281 |
1,142 |
||||||||
Net income |
26,281 |
24,570 |
7,669 |
||||||||
Net income, excluding merger costs (1) |
26,281 |
24,570 |
7,922 |
||||||||
Diluted earnings per share |
$ |
1.03 |
$ |
0.96 |
$ |
0.41 |
|||||
Diluted earnings per share, excluding merger costs (1) |
$ |
1.03 |
$ |
0.96 |
$ |
0.42 |
|||||
Return on average total assets |
1.44 |
% |
1.38 |
% |
0.54 |
% |
|||||
Return on average total assets, excluding merger costs (1) |
1.44 |
% |
1.38 |
% |
0.56 |
% |
|||||
Return on average stockholders' equity |
13.37 |
% |
12.89 |
% |
5.85 |
% |
|||||
Return on average stockholders’ equity, excluding merger costs (1) |
13.37 |
% |
12.89 |
% |
6.04 |
% |
|||||
Net interest margin |
4.39 |
% |
4.45 |
% |
3.08 |
% |
|||||
Net interest margin (FTE basis) (1) |
4.46 |
% |
4.52 |
% |
3.17 |
% |
|||||
Efficiency ratio |
60.47 |
% |
60.33 |
% |
80.75 |
% |
|||||
Efficiency ratio, excluding merger related expenses (1) |
60.47 |
% |
60.33 |
% |
80.28 |
% |
|||||
Fee revenue to total revenue |
20.35 |
% |
20.26 |
% |
36.46 |
% |
|||||
Total assets |
$ |
7,610,456 |
$ |
7,430,322 |
$ |
5,733,748 |
|||||
Total loans held-for-sale |
66,255 |
57,323 |
57,700 |
||||||||
Total loans held-for-investment |
6,060,975 |
5,911,832 |
4,315,031 |
||||||||
Total deposits |
5,994,266 |
5,765,062 |
4,946,482 |
||||||||
Total stockholders' equity |
799,050 |
774,536 |
515,541 |
||||||||
Period end loan-to-deposit ratio |
101.11 |
% |
102.55 |
% |
87.23 |
% |
|||||
Book value per common share |
$ |
32.06 |
$ |
31.08 |
$ |
28.10 |
|||||
Tangible book value per common share (1) |
$ |
27.72 |
$ |
26.69 |
$ |
25.87 |
|||||
(1) Represents a non-GAAP financial measure. See the tables within the “Non-GAAP Financial Measures and Reconciliations” section for a reconciliation of each non-GAAP measure to the most comparable GAAP equivalent. |
|||||||||||
Condensed Consolidated Statements of Income (Unaudited):
As of and for the quarter ended |
||||||||
($ in thousands, except per share amounts) |
March 31, 2023 |
December 31, 2022 |
March 31, 2022 |
|||||
Total interest income |
$ |
94,903 |
$ |
85,165 |
$ |
44,661 |
||
Total interest expense |
20,786 |
11,889 |
3,376 |
|||||
Net interest income |
74,117 |
73,276 |
41,285 |
|||||
Provision for credit losses |
3,360 |
5,600 |
3,700 |
|||||
Net interest income after provision for credit losses |
70,757 |
67,676 |
37,585 |
|||||
Noninterest income: |
||||||||
Service charges on deposits |
5,015 |
5,100 |
3,925 |
|||||
Credit and debit card fees |
2,981 |
3,003 |
2,415 |
|||||
Trust and investment advisory fees |
1,461 |
1,398 |
1,947 |
|||||
Mortgage banking income, net |
7,429 |
6,268 |
14,561 |
|||||
Other noninterest income |
2,045 |
2,849 |
845 |
|||||
Total noninterest income |
18,931 |
18,618 |
23,693 |
|||||
Noninterest expense: |
||||||||
Salaries and benefits |
35,049 |
32,378 |
34,225 |
|||||
Occupancy and equipment |
8,174 |
7,707 |
6,833 |
|||||
Amortization of intangible assets |
1,044 |
2,018 |
327 |
|||||
Merger related expenses |
— |
— |
303 |
|||||
Other noninterest expenses |
11,999 |
13,340 |
10,779 |
|||||
Total noninterest expense |
56,266 |
55,443 |
52,467 |
|||||
Income before income taxes |
33,422 |
30,851 |
8,811 |
|||||
Provision for income taxes |
7,141 |
6,281 |
1,142 |
|||||
Net income |
$ |
26,281 |
$ |
24,570 |
$ |
7,669 |
||
Earnings per share - basic |
$ |
1.05 |
$ |
0.99 |
$ |
0.42 |
||
Earnings per share - diluted |
$ |
1.03 |
$ |
0.96 |
$ |
0.41 |
||
Condensed Consolidated Balance Sheets as of (Unaudited):
($ in thousands) |
March 31, 2023 |
December 31, 2022 |
March 31, 2022 |
||||||||
Assets |
|||||||||||
Cash and cash equivalents |
$ |
388,349 |
$ |
343,526 |
$ |
487,689 |
|||||
Securities available-for-sale, at fair value |
532,650 |
536,973 |
556,723 |
||||||||
Securities held-to-maturity |
38,470 |
38,901 |
16,799 |
||||||||
Loans held-for-sale, at fair value |
66,255 |
57,323 |
57,700 |
||||||||
Loans |
6,060,975 |
5,911,832 |
4,315,031 |
||||||||
Allowance for credit losses |
(74,459 |
) |
(65,917 |
) |
(50,509 |
) |
|||||
Loans, net |
5,986,516 |
5,845,915 |
4,264,522 |
||||||||
Mortgage servicing rights, at fair value |
73,424 |
74,097 |
60,481 |
||||||||
Premises and equipment, net |
86,430 |
87,079 |
52,198 |
||||||||
Other real estate owned and foreclosed assets, net |
6,358 |
6,358 |
5,162 |
||||||||
Goodwill |
93,483 |
93,483 |
33,050 |
||||||||
Intangible assets, net |
14,762 |
15,806 |
7,923 |
||||||||
All other assets |
323,759 |
330,861 |
191,501 |
||||||||
Total assets |
$ |
7,610,456 |
$ |
7,430,322 |
$ |
5,733,748 |
|||||
Liabilities and Stockholders' Equity |
|||||||||||
Liabilities: |
|||||||||||
Deposits: |
|||||||||||
Noninterest-bearing demand deposit accounts |
$ |
1,764,440 |
$ |
1,820,490 |
$ |
1,662,980 |
|||||
Interest-bearing deposit accounts: |
|||||||||||
Interest-bearing demand accounts |
238,658 |
212,357 |
155,388 |
||||||||
Savings accounts and money market accounts |
2,705,315 |
2,759,969 |
2,742,393 |
||||||||
NOW accounts |
45,192 |
50,224 |
74,106 |
||||||||
Certificate of deposit accounts |
1,240,661 |
922,022 |
311,615 |
||||||||
Total deposits |
5,994,266 |
5,765,062 |
4,946,482 |
||||||||
Securities sold under agreements to repurchase |
31,645 |
36,721 |
69,627 |
||||||||
Federal Home Loan Bank advances |
577,285 |
643,885 |
40,000 |
||||||||
Other borrowings |
80,373 |
80,235 |
87,799 |
||||||||
Other liabilities |
127,837 |
129,883 |
74,299 |
||||||||
Total liabilities |
6,811,406 |
6,655,786 |
5,218,207 |
||||||||
Stockholders' equity: |
|||||||||||
Preferred stock |
— |
— |
— |
||||||||
Common stock |
2 |
2 |
2 |
||||||||
Additional paid-in capital |
461,174 |
460,720 |
262,071 |
||||||||
Treasury stock |
— |
— |
(38,148 |
) |
|||||||
Retained earnings |
380,270 |
357,797 |
306,284 |
||||||||
Accumulated other comprehensive loss, net |
(42,396 |
) |
(43,983 |
) |
(14,668 |
) |
|||||
Total stockholders' equity |
799,050 |
774,536 |
515,541 |
||||||||
Total liabilities and stockholders' equity |
$ |
7,610,456 |
$ |
7,430,322 |
$ |
5,733,748 |
|||||
Share Data as of and for the periods ended:
As of and for the quarter ended |
||||||||
March 31, 2023 |
December 31, 2022 |
March 31, 2022 |
||||||
Weighted average common shares outstanding, basic |
24,923,259 |
24,907,643 |
18,346,288 |
|||||
Weighted average common shares outstanding, diluted |
25,487,582 |
25,525,026 |
18,899,852 |
|||||
Period end common shares outstanding |
24,924,023 |
24,920,984 |
18,346,288 |
|||||
Book value per common share |
$ |
32.06 |
$ |
31.08 |
$ |
28.10 |
||
Tangible book value per common share (1) |
$ |
27.72 |
$ |
26.69 |
$ |
25.87 |
||
Consolidated Capital Ratios as of:
March 31, 2023 |
December 31, 2022 |
March 31, 2022 |
||||||
Stockholders' equity to total assets |
10.50 |
% |
10.42 |
% |
8.99 |
% |
||
Tangible common stockholders' equity to tangible assets (1) |
9.21 |
% |
9.09 |
% |
8.34 |
% |
||
Tangible common stockholders' equity to tangible assets reflecting net unrealized losses on HTM securities, net of tax (1) (2) |
9.16 |
% |
9.03 |
% |
8.34 |
% |
||
Tier 1 leverage ratio |
9.86 |
% |
9.71 |
% |
8.42 |
% |
||
Common equity tier 1 risk-based capital ratio |
10.11 |
% |
9.94 |
% |
9.27 |
% |
||
Tier 1 risk-based capital ratio |
10.11 |
% |
9.94 |
% |
9.27 |
% |
||
Total risk-based capital ratio |
12.19 |
% |
11.99 |
% |
11.74 |
% |
||
(1) Represents a non-GAAP financial measure. See the tables within the “Non-GAAP Financial Measures and Reconciliations” section for a reconciliation of each non-GAAP measure to the most comparable GAAP equivalent. |
||||||||
(2) Tangible common stockholders’ equity and tangible assets have been adjusted to reflect net unrealized losses on held-to-maturity securities, net of tax. |
||||||||
Summary of Net Interest Margin:
For the quarter ended March 31, 2023 |
For the quarter ended December 31, 2022 |
For the quarter ended March 31, 2022 |
||||||||||||||||||||||||||||
(In thousands) |
Average Balance |
Interest |
Average Yield/Rate |
Average Balance |
Interest |
Average Yield/Rate |
Average Balance |
Interest |
Average Yield/Rate |
|||||||||||||||||||||
Interest Earning Assets |
||||||||||||||||||||||||||||||
Loans held-for-sale |
$ |
50,129 |
$ |
654 |
5.22 |
% |
$ |
51,835 |
$ |
606 |
4.68 |
% |
$ |
60,895 |
$ |
694 |
4.56 |
% |
||||||||||||
Loans held-for-investment (1) |
5,978,860 |
87,947 |
5.88 |
% |
5,759,436 |
78,669 |
5.46 |
% |
4,123,920 |
41,164 |
3.99 |
% |
||||||||||||||||||
Investment securities |
570,682 |
4,164 |
2.92 |
% |
573,592 |
3,933 |
2.74 |
% |
582,333 |
2,275 |
1.56 |
% |
||||||||||||||||||
Interest-bearing cash and other assets |
156,262 |
2,138 |
5.47 |
% |
204,964 |
1,957 |
3.82 |
% |
592,478 |
528 |
0.36 |
% |
||||||||||||||||||
Total earning assets |
6,755,933 |
94,903 |
5.62 |
% |
6,589,827 |
85,165 |
5.17 |
% |
5,359,626 |
44,661 |
3.33 |
% |
||||||||||||||||||
Other assets |
553,961 |
553,870 |
314,043 |
|||||||||||||||||||||||||||
Total assets |
$ |
7,309,894 |
$ |
7,143,697 |
$ |
5,673,669 |
||||||||||||||||||||||||
Interest-bearing liabilities |
||||||||||||||||||||||||||||||
Demand and NOW deposits |
$ |
227,170 |
$ |
1,234 |
2.17 |
% |
$ |
213,491 |
$ |
927 |
1.74 |
% |
$ |
223,020 |
$ |
124 |
0.22 |
% |
||||||||||||
Savings deposits |
470,000 |
445 |
0.38 |
% |
492,837 |
348 |
0.28 |
% |
468,713 |
91 |
0.08 |
% |
||||||||||||||||||
Money market deposits |
2,296,469 |
5,068 |
0.88 |
% |
2,412,289 |
3,126 |
0.52 |
% |
2,306,638 |
840 |
0.15 |
% |
||||||||||||||||||
Certificates of deposits |
1,073,006 |
7,432 |
2.77 |
% |
647,819 |
1,733 |
1.07 |
% |
317,948 |
519 |
0.65 |
% |
||||||||||||||||||
Total deposits |
4,066,645 |
14,179 |
1.39 |
% |
3,766,436 |
6,134 |
0.65 |
% |
3,316,319 |
1,574 |
0.19 |
% |
||||||||||||||||||
Repurchase agreements |
29,672 |
30 |
0.41 |
% |
38,795 |
45 |
0.46 |
% |
71,425 |
8 |
0.04 |
% |
||||||||||||||||||
Total deposits and repurchase agreements |
4,096,317 |
14,209 |
1.39 |
% |
3,805,231 |
6,179 |
0.65 |
% |
3,387,744 |
1,582 |
0.19 |
% |
||||||||||||||||||
FHLB borrowings |
454,081 |
5,317 |
4.68 |
% |
471,880 |
4,477 |
3.80 |
% |
40,229 |
148 |
1.48 |
% |
||||||||||||||||||
Other long-term borrowings |
80,300 |
1,260 |
6.28 |
% |
80,162 |
1,233 |
6.15 |
% |
86,191 |
1,646 |
7.63 |
% |
||||||||||||||||||
Total interest-bearing liabilities |
4,630,698 |
20,786 |
1.80 |
% |
4,357,273 |
11,889 |
1.09 |
% |
3,514,164 |
3,376 |
0.38 |
% |
||||||||||||||||||
Noninterest-bearing deposits |
1,768,381 |
1,923,401 |
1,566,088 |
|||||||||||||||||||||||||||
Other liabilities |
124,543 |
100,671 |
68,999 |
|||||||||||||||||||||||||||
Stockholders' equity |
786,272 |
762,352 |
524,418 |
|||||||||||||||||||||||||||
Total liabilities and stockholders' equity |
$ |
7,309,894 |
$ |
7,143,697 |
$ |
5,673,669 |
||||||||||||||||||||||||
Net interest income |
$ |
74,117 |
$ |
73,276 |
$ |
41,285 |
||||||||||||||||||||||||
Net interest spread |
3.82 |
% |
4.08 |
% |
2.95 |
% |
||||||||||||||||||||||||
Net interest margin |
4.39 |
% |
4.45 |
% |
3.08 |
% |
||||||||||||||||||||||||
Net interest margin (on FTE basis) (2) |
4.46 |
% |
4.52 |
% |
3.17 |
% |
||||||||||||||||||||||||
(1) Includes nonaccrual loans. |
||||||||||||||||||||||||||||||
(2) Represents a non-GAAP financial measure. See the tables within the “Non-GAAP Financial Measures and Reconciliations” section for a reconciliation of each non-GAAP measure to the most comparable GAAP equivalent. |
||||||||||||||||||||||||||||||
Deposits:
($ in thousands) |
March 31, 2023 |
December 31, 2022 |
March 31, 2023 vs December 31, 2022 % change |
March 31, 2022 |
March 31, 2023 vs March 31, 2022 % change |
|||||||||
Consumer |
||||||||||||||
Noninterest bearing deposit accounts |
$ |
399,008 |
$ |
416,709 |
(4.25 |
) % |
$ |
361,475 |
10.38 |
% |
||||
Interest-bearing deposit accounts: |
||||||||||||||
Demand and NOW deposits |
25,284 |
25,940 |
(2.53 |
) % |
28,083 |
(9.97 |
) % |
|||||||
Savings deposits |
407,173 |
418,101 |
(2.61 |
) % |
421,397 |
(3.38 |
) % |
|||||||
Money market deposits |
1,296,099 |
1,375,671 |
(5.78 |
) % |
1,463,495 |
(11.44 |
) % |
|||||||
Certificates of deposits |
759,726 |
662,831 |
14.62 |
% |
291,105 |
160.98 |
% |
|||||||
Total interest-bearing deposit accounts |
2,488,282 |
2,482,543 |
0.23 |
% |
2,204,080 |
12.89 |
% |
|||||||
Total consumer deposits |
$ |
2,887,290 |
$ |
2,899,252 |
(0.41 |
) % |
$ |
2,565,555 |
12.54 |
% |
||||
Business |
||||||||||||||
Noninterest bearing deposit accounts |
$ |
1,365,432 |
$ |
1,403,781 |
(2.73 |
) % |
$ |
1,301,505 |
4.91 |
% |
||||
Interest-bearing deposit accounts: |
||||||||||||||
Demand and NOW deposits |
258,566 |
236,641 |
9.27 |
% |
201,411 |
28.38 |
% |
|||||||
Savings deposits |
59,308 |
58,818 |
0.83 |
% |
54,438 |
8.95 |
% |
|||||||
Money market deposits |
942,735 |
907,379 |
3.90 |
% |
803,063 |
17.39 |
% |
|||||||
Certificates of deposits |
480,935 |
259,191 |
85.55 |
% |
20,510 |
2244.88 |
% |
|||||||
Total interest-bearing deposit accounts |
1,741,544 |
1,462,029 |
19.12 |
% |
1,079,422 |
61.34 |
% |
|||||||
Total business customer deposits |
$ |
3,106,976 |
$ |
2,865,810 |
8.42 |
% |
$ |
2,380,927 |
30.49 |
% |
||||
Total deposits |
$ |
5,994,266 |
$ |
5,765,062 |
3.98 |
% |
$ |
4,946,482 |
21.18 |
% |
||||
Balance Sheet Ratios:
March 31, 2023 |
December 31, 2022 |
March 31, 2022 |
||||||
Cash to total assets (1) |
4.6 |
% |
4.1 |
% |
7.10 |
% |
||
Loan to deposit ratio |
101.11 |
% |
102.55 |
% |
87.23 |
% |
||
Uninsured and uncollateralized deposits to total deposits (2) |
25.5 |
% |
41.6 |
% |
51.3 |
% |
||
Wholesale borrowings to total liabilities (3) |
8.48 |
% |
9.67 |
% |
0.77 |
% |
||
Tangible common stockholders' equity to tangible assets (4) |
9.21 |
% |
9.09 |
% |
8.34 |
% |
||
Tangible common stockholders' equity to tangible assets, reflecting net unrealized losses on HTM securities, net of tax (4) (5) |
9.16 |
% |
9.03 |
% |
8.34 |
% |
||
(1) Cash consists of cash and amounts due from banks and interest-bearing deposits in other financial institutions. |
||||||||
(2) Uninsured and uncollateralized deposits are estimated. |
||||||||
(3) Wholesale borrowings consists of FHLB overnight borrowings and term advances. |
||||||||
(4) Represents a non-GAAP financial measure. See the tables within the “Non-GAAP Financial Measures and Reconciliations” section for a reconciliation of each non-GAAP measure to the most comparable GAAP equivalent. |
||||||||
(5) Tangible common stockholders’ equity and tangible assets have been adjusted to reflect net unrealized losses on held-to-maturity securities, net of tax. |
||||||||
Loan Portfolio:
($ in thousands) |
March 31, 2023 |
December 31, 2022 |
March 31, 2023 vs December 31, 2022 % change |
March 31, 2022 |
March 31, 2023 vs March 31, 2022 % change |
|||||||||
Commercial and industrial |
$ |
2,418,771 |
$ |
2,310,929 |
4.7 |
% |
$ |
1,819,705 |
32.9 |
% |
||||
Commercial real estate: |
||||||||||||||
Non-owner occupied |
709,977 |
779,546 |
(8.9 |
) % |
624,729 |
13.6 |
% |
|||||||
Owner occupied |
659,999 |
636,272 |
3.7 |
% |
445,654 |
48.1 |
% |
|||||||
Construction and land |
320,193 |
327,817 |
(2.3 |
) % |
144,122 |
122.2 |
% |
|||||||
Multifamily |
103,767 |
102,068 |
1.7 |
% |
66,112 |
57.0 |
% |
|||||||
Total commercial real estate |
1,793,936 |
1,845,703 |
(2.8 |
) % |
1,280,617 |
40.1 |
% |
|||||||
Residential real estate |
1,046,047 |
1,003,931 |
4.2 |
% |
501,230 |
108.7 |
% |
|||||||
Public Finance |
597,850 |
590,284 |
1.3 |
% |
624,187 |
(4.2 |
) % |
|||||||
Consumer |
40,806 |
42,588 |
(4.2 |
) % |
17,981 |
126.9 |
% |
|||||||
Other |
163,565 |
118,397 |
38.1 |
% |
71,311 |
129.4 |
% |
|||||||
Total loans, net of deferred costs, fees, premiums, and discounts |
$ |
6,060,975 |
$ |
5,911,832 |
2.5 |
% |
$ |
4,315,031 |
40.5 |
% |
||||
Asset Quality:
As of and for the quarter ended |
|||||||||||
($ in thousands) |
March 31, 2023 |
December 31, 2022 |
March 31, 2022 |
||||||||
Net charge-offs (recoveries) |
$ |
54 |
$ |
(639 |
) |
$ |
738 |
||||
Allowance for credit losses |
$ |
74,459 |
$ |
65,917 |
$ |
50,509 |
|||||
Nonperforming loans, including nonaccrual loans, and accrual loans greater than 90 days past due (1) |
$ |
32,833 |
$ |
29,067 |
$ |
25,365 |
|||||
Nonperforming assets |
$ |
39,191 |
$ |
35,425 |
$ |
30,527 |
|||||
Ratio of net charge-offs (recoveries) to average loans outstanding |
— |
% |
(0.04 |
) % |
0.07 |
% |
|||||
Allowance for credit losses to total loans outstanding |
1.23 |
% |
1.12 |
% |
1.17 |
% |
|||||
Allowance for credit losses to total nonperforming loans |
226.78 |
% |
226.78 |
% |
199.13 |
% |
|||||
Nonperforming loans to total loans |
0.54 |
% |
0.49 |
% |
0.59 |
% |
|||||
Nonperforming assets to total assets |
0.51 |
% |
0.48 |
% |
0.53 |
% |
|||||
(1) On January 1, 2023, we adopted ASU 2022-02, whereby we no longer recognize or account for TDRs. The loans previously classified as accrual TDRs are no longer considered nonperforming. We have adjusted prior periods to reflect this change in accounting. |
|||||||||||
Non-GAAP Financial Measures and Reconciliations:
As of and for the quarter ended |
|||||||||||
($ in thousands, except share and per share amounts) |
March 31, 2023 |
December 31, 2022 |
March 31, 2022 |
||||||||
Tangible common stockholders’ equity: |
|||||||||||
Total common stockholders' equity (GAAP) |
$ |
799,050 |
$ |
774,536 |
$ |
515,541 |
|||||
Less: Goodwill and other intangible assets: |
|||||||||||
Goodwill |
(93,483 |
) |
(93,483 |
) |
(33,050 |
) |
|||||
Other intangible assets |
(14,762 |
) |
(15,806 |
) |
(7,923 |
) |
|||||
Total tangible common stockholders' equity (non-GAAP) (1) |
$ |
690,805 |
$ |
665,247 |
$ |
474,568 |
|||||
Tangible assets: |
|||||||||||
Total assets (GAAP) |
$ |
7,610,456 |
$ |
7,430,322 |
$ |
5,733,748 |
|||||
Less: Goodwill and other intangible assets: |
|||||||||||
Goodwill |
(93,483 |
) |
(93,483 |
) |
(33,050 |
) |
|||||
Other intangible assets |
(14,762 |
) |
(15,806 |
) |
(7,923 |
) |
|||||
Total tangible assets (non-GAAP) |
$ |
7,502,211 |
$ |
7,321,033 |
$ |
5,692,775 |
|||||
Tangible common stockholders’ equity to tangible assets: |
|||||||||||
Common stockholders' equity to total assets (GAAP) |
10.50 |
% |
10.42 |
% |
8.99 |
% |
|||||
Less: Impact of goodwill and other intangible assets |
(1.29 |
) % |
(1.33 |
) % |
(0.65 |
) % |
|||||
Tangible common stockholders' equity to tangible assets (non-GAAP) (1) |
9.21 |
% |
9.09 |
% |
8.34 |
% |
|||||
Tangible common stockholders’ equity to tangible assets, reflecting net unrealized losses on HTM securities, net of tax: |
|||||||||||
Total tangible common stockholders' equity (non-GAAP) |
$ |
690,805 |
$ |
665,247 |
$ |
474,568 |
|||||
Less: Net unrealized losses on HTM securities, net of tax |
(3,754 |
) |
(4,295 |
) |
(79 |
) |
|||||
Total tangible common stockholders’ equity less net unrealized losses on HTM securities, net of tax (non-GAAP) |
$ |
687,051 |
$ |
660,952 |
$ |
474,489 |
|||||
Total tangible assets (non-GAAP) |
$ |
7,502,211 |
$ |
7,321,033 |
$ |
5,692,775 |
|||||
Less: Net unrealized losses on HTM securities, net of tax |
(3,754 |
) |
(4,295 |
) |
(79 |
) |
|||||
Total tangible assets less net unrealized losses on HTM securities, net of tax (non-GAAP) |
$ |
7,498,457 |
$ |
7,316,738 |
$ |
5,692,696 |
|||||
Tangible common stockholders’ equity to tangible assets (non-GAAP) |
9.21 |
% |
9.09 |
% |
8.34 |
% |
|||||
Less: Net unrealized losses on HTM securities, net of tax |
0.05 |
% |
0.06 |
% |
— |
% |
|||||
Tangible common stockholders’ equity to tangible assets reflecting net unrealized losses on HTM securities, net of tax (non-GAAP) |
9.16 |
% |
9.03 |
% |
8.34 |
% |
|||||
Tangible book value per common share: |
|||||||||||
Stockholders' equity (GAAP) |
$ |
799,050 |
$ |
774,536 |
$ |
515,541 |
|||||
Tangible stockholders' equity (non-GAAP) (1) |
$ |
690,805 |
$ |
665,247 |
$ |
474,568 |
|||||
Total common shares outstanding |
24,924,023 |
24,920,984 |
18,346,288 |
||||||||
Book value per common share (GAAP) |
$ |
32.06 |
$ |
31.08 |
$ |
28.10 |
|||||
Tangible book value per common share (non-GAAP) |
$ |
27.72 |
$ |
26.69 |
$ |
25.87 |
|||||
Net income excluding merger costs: |
|||||||||||
Net income (GAAP) |
$ |
26,281 |
$ |
24,570 |
$ |
7,669 |
|||||
Add: Merger costs |
|||||||||||
Merger related expenses |
— |
— |
303 |
||||||||
Income tax effect on merger related expenses |
— |
— |
(50 |
) |
|||||||
Total merger costs |
— |
— |
253 |
||||||||
Net income excluding merger costs (non-GAAP) |
$ |
26,281 |
$ |
24,570 |
$ |
7,922 |
|||||
Return on average total assets excluding merger costs: |
|||||||||||
Return on average total assets (ROAA) (GAAP) |
1.44 |
% |
1.38 |
% |
0.54 |
% |
|||||
Add: Impact of merger costs, net of tax |
— |
% |
— |
% |
0.02 |
% |
|||||
ROAA excluding merger costs (non-GAAP) |
1.44 |
% |
1.38 |
% |
0.56 |
% |
|||||
(1) For all periods presented tangible stockholders’ equity is the same as tangible common stockholders’ equity. |
|||||||||||
Return on average stockholders’ equity excluding merger costs: |
|||||||||||
Return on average stockholders' equity (ROAE) (GAAP) |
13.37 |
% |
12.89 |
% |
5.85 |
% |
|||||
Add: Impact of merger costs, net of tax |
— |
% |
— |
% |
0.19 |
% |
|||||
ROAE excluding merger costs (non-GAAP) |
13.37 |
% |
12.89 |
% |
6.04 |
% |
|||||
Efficiency ratio excluding merger related expenses: |
|||||||||||
Efficiency ratio (GAAP) |
60.47 |
% |
60.33 |
% |
80.75 |
% |
|||||
Less: Impact of merger related expenses |
— |
% |
— |
% |
0.47 |
% |
|||||
Efficiency ratio excluding merger related expenses (non-GAAP) |
60.47 |
% |
60.33 |
% |
80.28 |
% |
|||||
Diluted earnings per share excluding merger costs: |
|||||||||||
Diluted earnings per share (GAAP) |
$ |
1.03 |
$ |
0.96 |
$ |
0.41 |
|||||
Add: Impact of merger costs, net of tax |
— |
— |
0.01 |
||||||||
Diluted earnings per share excluding merger costs (non-GAAP) |
$ |
1.03 |
$ |
0.96 |
$ |
0.42 |
|||||
Fully tax equivalent (“FTE”) net interest income and net interest margin on FTE basis: |
|||||||||||
Net interest income (GAAP) |
$ |
74,117 |
$ |
73,276 |
$ |
41,285 |
|||||
Gross income effect of tax exempt income |
1,242 |
1,218 |
1,321 |
||||||||
FTE net interest income (non-GAAP) |
$ |
75,359 |
$ |
74,494 |
$ |
42,606 |
|||||
Average earning assets |
$ |
6,755,933 |
$ |
6,589,827 |
$ |
5,359,626 |
|||||
Net interest margin |
4.39 |
% |
4.45 |
% |
3.08 |
% |
|||||
Net interest margin on FTE basis (non-GAAP) |
4.46 |
% |
4.52 |
% |
3.17 |
% |
|||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20230428005390/en/
Investor Relations: Kelly C. Rackley Corporate Secretary & Stockholder Relations Manager 303.962.0150 | stockholder.relations@sunflowerbank.com Media Relations: Jeanne Lipson Vice President, Marketing 915.881.6785
Source: FirstSun Capital Bancorp