Reliant Bancorp, Inc. (“Reliant Bancorp” or the “Company”) (Nasdaq: RBNC), parent company of Reliant Bank (the “Bank”), reported net income attributable to common shareholders of $13.3 million, or $0.79 per diluted common share, for the third quarter of 2021 compared to net income attributable to common shareholders of $13.0 million, or $0.78 per diluted common share, for the second quarter of 2021, and $11.5 million, or $0.69 per diluted common share, for the third quarter of 2020. When merger expenses are excluded, income per diluted common share increased to $0.87 during the third quarter of 2021 compared to $0.78 and $0.70 the second quarter of 2021 and the third quarter of 2020, respectively.
DeVan Ard, Jr., Reliant Bancorp's Chairman and CEO stated, “I am very pleased to continue 2021 with solid third quarter results as evidenced by our strong net interest margin, sound asset quality, and impressive loan production. Loan growth has continued to accelerate with a 3.0% increase from the prior quarter. When PPP loans are excluded, loan growth increased to 3.6%, or 14.2% when annualized.”
Ard continued, “Our team continues to focus on reducing high cost wholesale deposits, as customer deposits increased to make up 89.9% of our deposit portfolio and the cost of deposits decreased to 0.58%, or 0.26% when adjusted for swap termination fees. We also continued to build shareholder value as our book value and tangible book value per share increased 2.8% and 3.7%, respectively, from the prior quarter, or 11.3% and 14.6%, respectively, when annualized. Additionally, shareholders’ equity to total assets and tangible common equity to tangible assets increased to 11.82% and 9.90%, respectively, which allows us to continue to deliver exceptional returns to our shareholders.”
Third Quarter Highlights Dollar Amounts in Thousands, Except Per Share Amounts | ||||||||||||
2021 | 2020 | |||||||||||
Third
| Second
| Third
| ||||||||||
Results of Operations Highlights | ||||||||||||
Net income attributable to common shareholders | $ | 13,289 | $ | 13,045 | $ | 11,533 | ||||||
Net income per diluted common share | $ | 0.79 | $ | 0.78 | $ | 0.69 | ||||||
Net interest margin (NIM) (1) | 4.22 | % | 4.14 | % | 4.54 | % | ||||||
Adjusted NIM (2) | 4.40 | % | 4.28 | % | 3.99 | % | ||||||
Pre-tax pre-provision income (2) | $ | 17,487 | $ | 16,387 | $ | 16,207 | ||||||
Efficiency ratio (tax equivalent basis) | 54.8 | % | 54.1 | % | 54.0 | % | ||||||
Bank segment adjusted efficiency ratio (2) | 46.4 | % | 49.1 | % | 48.6 | % | ||||||
Balance Sheet Highlights | ||||||||||||
Loans | $ | 2,389,833 | $ | 2,321,070 | $ | 2,357,898 | ||||||
Allowance for loan losses | (20,897 | ) | (20,894 | ) | (19,834 | ) | ||||||
Total assets | 3,013,559 | 3,098,464 | 3,044,512 | |||||||||
Total deposits | 2,547,705 | 2,629,840 | 2,565,502 | |||||||||
Book value per share | $ | 21.36 | $ | 20.77 | $ | 18.46 | ||||||
Tangible book value per share (2) | $ | 17.50 | $ | 16.88 | $ | 14.65 | ||||||
Return on average: (3) | ||||||||||||
Assets ("ROAA") | 1.74 | % | 1.69 | % | 1.53 | % | ||||||
Equity ("ROAE") | 15.01 | % | 15.41 | % | 15.32 | % | ||||||
Tangible common equity ("ROATCE") (2) | 18.40 | % | 19.07 | % | 19.42 | % | ||||||
(1) | Net interest margin is the result of annualized net interest income calculated on a tax-equivalent basis divided by average interest-earning assets for the period. |
(2) | Certain measures are considered non-GAAP financial measures. See “Reconciliation of Non-GAAP Financial Measures - Unaudited.” |
(3) | Data has been annualized. |
Net Interest Margin Improves Through Asset Mix Optimization
Net interest margin increased to 4.22% at September 30, 2021, an increase of 8 basis points from the previous quarter and a decrease of 32 basis points from the third quarter of 2020. The linked quarter increase was primarily due to a 23 basis point decrease in our cost of funds due to a decrease in interest-bearing deposits, especially higher cost wholesale time deposits, as well as a $2,290 swap termination fee incurred during the quarter compared to the $2,859 swap termination fee incurred during the previous quarter. The adjusted net interest margin, which excludes this swap termination fee impact as well as the benefits from purchase accounting accretion, showed continued improvement as it increased 12 basis points from the linked quarter to 4.40%. Net income and earnings per share during the quarter were not affected by this termination fee as securities were sold for a gain of $2,419 to offset the transaction.
Loan yields remain strong at 4.96% when excluding fees, representing a decrease of 16 basis points from the linked quarter and a 38 basis point decrease from the same period in the prior year, which can both largely be attributed to the decrease in purchase accounting accretion. As of September 30, 2021, $12.0 million of purchase accounting accretion remains unaccreted.
The cost of deposits continued to improve to 0.58% with a decrease of 25 basis points from the previous quarter and 4 basis points from the third quarter of 2020. When removing the impact of the second and third quarter swap termination fees the cost of deposits improves even further to 0.26%, or a decrease of 15 basis points from the previous quarter and 36 basis points from the third quarter of 2020. This decrease is largely the result of a decrease in average wholesale time deposits of $74.4 million and $104.6 million from the linked quarter and year-over-year, respectively. These decreases were offset by an increase in average noninterest-bearing deposits of $19.7 million and $80.6 million from the linked quarter and year-over-year, respectively.
Continued Loan Growth and Asset Quality Stability
Loans increased $68.8 million from the linked quarter to $2.4 billion. Loan originations during the quarter totaled $272.0 million at a weighted-average coupon rate of 4.15% with a continued focus on credit quality through sound underwriting. These originations were offset with principal payments, including PPP forgiveness payments of $13.7 million. When PPP loans are excluded, loans increased $82.5 million, or 3.6%, from the linked quarter and $114.9 million, or 5.1%, year-over-year.
Our longstanding focus on credit quality continued to be a source of strength with net recoveries continuing into the third quarter. Nonperforming loans held for investment accounted for 0.22% of total loans held for investment and nonperforming assets accounted for only 0.34% of total assets at September 30, 2021, despite the addition of a retired bank facility to other real estate owned during the quarter. Criticized assets to total loans remains low at 0.60%. The allowance for loan loss was 0.87% of loans (1.38% including unaccreted net purchased loan discounts) at September 30, 2021. There was no provision recognized during the quarter as net charge-offs were in a recovery position for the quarter and year-to-date.
Conclusion
Ard concluded, “I am proud of our team’s ability to serve the community and our shareholders as well as our ability to create meaningful careers and a positive workplace for our employees as evidenced through Newsweek’s recognition of the Bank as the Best Small Bank in Tennessee for the second year in a row. We continue to see increased demand in the loan pipeline as we move into the fourth quarter, and we are optimistic about our market and financial positions as we continue to build a bright future for Reliant Bank.”
About Reliant Bancorp, Inc. and Reliant Bank
Reliant Bancorp, Inc. is a Brentwood, Tennessee-based financial holding company which, through its wholly owned subsidiary Reliant Bank, operates banking centers in Tennessee. Reliant Bank is a full-service commercial bank that offers a variety of deposit, lending, and mortgage products and services to business and consumer customers. As of September 30, 2021, Reliant Bancorp had approximately $3.0 billion in total consolidated assets, approximately $2.4 billion in loans held for investment and approximately $2.5 billion in deposits. For additional information, locations and hours of operation, please visit www.reliantbank.com.
Financial Measures
This release contains certain financial measures that are not measures recognized under generally accepted accounting principles (“GAAP”) and, therefore, are considered non-GAAP financial measures. Members of Company management use these non-GAAP financial measures in their analysis of the Company’s performance, financial condition, and efficiency of operations. Management of the Company believes that these non-GAAP financial measures provide a greater understanding of ongoing operations, enhance comparability of results with prior periods, and demonstrate the effects of significant gains and charges in the periods presented. Management of the Company also believes that investors find these non-GAAP financial measures useful as they assist investors in understanding underlying operating performance and identifying and analyzing ongoing operating trends. However, the non-GAAP financial measures discussed herein should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which the non-GAAP financial measures discussed herein are calculated may differ from the manner in which measures with similar names are calculated by other companies. You should understand how other companies calculate their financial measures similar to, or with names similar to, the non-GAAP financial measures we have discussed herein when comparing such non-GAAP financial measures.
The non-GAAP financial measures in this release include “adjusted net interest margin (NIM),” “adjusted net income,” “adjusted diluted earnings per share (EPS),” “adjusted annualized return on average assets (ROAA),” “adjusted annualized return on average equity (ROAE),” “adjusted annualized return on average tangible common equity (ROATCE),” “adjusted pre-tax pre-provision income,” “tangible common equity to tangible assets (TCE/TA),” “tangible book value per share,” “allowance for loan losses plus unaccreted purchased loan discounts to total loans,” “bank segment adjusted net income,” “bank segment adjusted noninterest expense,” “bank segment adjusted efficiency ratio,” “adjusted cost of funds,” “adjusted cost of interest-bearing liabilities,” and “adjusted cost of deposits.”
Forward-Looking Statements
All statements, other than statements of historical fact, included in this release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements relating to continued delivery of exceptional shareholder returns, increased demand in the loan pipeline, and management’s optimism about the Company’s market and financial positions. The words “believe,” “anticipate,” “expect,” “may,” “will,” “assume,” “should,” “predict,” “could,” “would,” “intend,” “targets,” “estimates,” “projects,” “plans,” and “potential,” and other similar words and expressions of the future, are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking, including statements about the Company’s future financial and operating results and the Company’s plans, objectives, and intentions. All forward-looking statements are subject to risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of the Company to differ materially from any results, performance, or achievements expressed or implied by such forward-looking statements. Such risks, uncertainties, and other factors include, among others: (1) the effects of the coronavirus (COVID-19) pandemic, including (i) the magnitude and duration of the pandemic and its impact on general economic and financial market conditions and on our business, results of operations, and financial condition and that of our customers, (ii) actions taken by governments, businesses and individuals in response to the coronavirus (COVID-19) pandemic, (iii) the pace of recovery when the coronavirus (COVID-19) pandemic subsides, and (iv) the speed with which coronavirus (COVID-19) vaccines can be widely distributed, those vaccines’ efficacy against the virus and public acceptance of the vaccines, (2) the possibility that our asset quality could decline or that we experience greater loan losses than anticipated, (3) increased levels of other real estate, primarily as a result of foreclosures, (4) the impact of liquidity needs on our results of operations and financial condition, (5) competition from financial institutions and other financial service providers, (6) the effect of interest rate increases on the cost of deposits, (7) unanticipated weakness in loan demand or loan pricing, (8) unanticipated adverse conditions in the national economy or local economies in which we operate, including in Middle Tennessee, (9) lack of strategic growth opportunities or our failure to execute on available opportunities, (10) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses, (11) economic crises and associated credit issues in industries most impacted by the coronavirus (COVID-19) pandemic, including the hotel and retail sectors, (12) the ability to grow and retain low-cost core deposits and retain large, uninsured deposits, (13) our ability to effectively manage problem credits, (14) our ability to successfully implement efficiency initiatives on time and with the results projected, (15) our ability to successfully develop and market new products and technology, (16) the impact of negative developments in the financial industry and United States and global capital and credit markets, (17) our ability to retain the services of key personnel, (18) our ability to adapt to technological changes, (19) risks associated with litigation, including reputational and financial risks and the applicability of insurance coverage, (20) the vulnerability of the Bank’s computer and information technology systems and networks, and the systems and networks of third parties with whom the Company or the Bank contract, to unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss, and other security breaches and interruptions, (21) changes in state and federal laws, rules, regulations, or policies applicable to banks or bank or financial holding companies, including regulatory or legislative developments, (22) adverse impacts (including costs, fines, reputational harm, or other negative effects) from current or future litigation, regulatory examinations, or other legal and/or regulatory actions, (23) the ability to meet expectations regarding the timing and completion and accounting and tax treatment of the pending transaction with United Community Banks, Inc. (the “Transaction”), (24) the effect of the announcement and pendency of the Transaction on customer, supplier, or employee relationships and operating results (including without limitation difficulties in maintaining relationships with employees and customers), as well as on the market price of the Company's common stock, (25) the occurrence of any event, change, or other circumstances that could give rise to the termination of the definitive merger agreement for the Transaction, (26) the amount of costs, fees, expenses and charges related to the Transaction, including those arising as a result of unexpected factors or events, (27) the ability to obtain the shareholder and governmental approvals required for the Transaction, (28) reputational risk associated with and the reaction of the parties' customers, suppliers, employees, or other business partners to the Transaction, (29) the failure of any of the conditions to the closing of the Transaction to be satisfied, or any unexpected delay in closing the Transaction, (30) the risk associated with Company management's attention being diverted away from the day-to-day business and operations of the Company to the completion of the Transaction, and (31) general competitive, economic, political, and market conditions, including economic conditions in the local markets where we operate. Additional factors which could affect the forward-looking statements can be found in the Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) and available on the SEC’s website at http://www.sec.gov. The Company believes the forward-looking statements contained herein are reasonable; however, many of such risks, uncertainties, and other factors are beyond the Company’s ability to control or predict and undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. Therefore, the Company can give no assurance that its future results will be as estimated. The Company does not intend to, and disclaims any obligation to, update or revise any forward-looking statement.
RELIANT BANCORP, INC. CONSOLIDATED BALANCE SHEETS - Unaudited (Dollar amounts in thousands, except per share amounts) | ||||||||||||
September 30,
| June 30,
| September 30,
| ||||||||||
ASSETS | ||||||||||||
Cash and due from banks | $ | 13,270 | $ | 11,763 | $ | 14,050 | ||||||
Interest-bearing deposits in financial institutions | 66,155 | 43,676 | 61,349 | |||||||||
Federal funds sold | 1,002 | 656 | 12,273 | |||||||||
Total cash and cash equivalents | 80,427 | 56,095 | 87,672 | |||||||||
Securities available for sale | 254,416 | 266,695 | 273,893 | |||||||||
Loans | 2,389,833 | 2,321,070 | 2,357,898 | |||||||||
Less: allowance for loan losses | (20,897 | ) | (20,894 | ) | (19,834 | ) | ||||||
Loans, net | 2,368,936 | 2,300,176 | 2,338,064 | |||||||||
Mortgage loans held for sale, net | 62,543 | 229,418 | 99,587 | |||||||||
Accrued interest receivable | 14,374 | 14,492 | 14,615 | |||||||||
Premises and equipment, net | 27,519 | 29,183 | 33,319 | |||||||||
Operating leases right of use assets | 12,427 | 12,744 | 14,619 | |||||||||
Restricted equity securities, at cost | 15,770 | 15,770 | 17,367 | |||||||||
Other real estate, net | 3,088 | 2,233 | 1,326 | |||||||||
Cash surrender value of life insurance contracts | 78,460 | 78,979 | 68,109 | |||||||||
Deferred tax assets, net | 5,788 | 5,978 | 8,523 | |||||||||
Goodwill | 54,396 | 54,396 | 51,506 | |||||||||
Core deposit intangibles | 9,978 | 10,434 | 11,820 | |||||||||
Other assets | 25,437 | 21,871 | 24,092 | |||||||||
TOTAL ASSETS | $ | 3,013,559 | $ | 3,098,464 | $ | 3,044,512 | ||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
Deposits | ||||||||||||
Noninterest-bearing demand | $ | 626,598 | $ | 602,555 | $ | 538,844 | ||||||
Interest-bearing demand | 410,923 | 441,161 | 272,805 | |||||||||
Savings and money market deposit accounts | 989,677 | 1,003,402 | 813,001 | |||||||||
Time | 520,507 | 582,722 | 940,852 | |||||||||
Total deposits | 2,547,705 | 2,629,840 | 2,565,502 | |||||||||
Accrued interest payable | 2,302 | 1,967 | 3,744 | |||||||||
Federal funds purchased | — | — | 5,000 | |||||||||
Subordinated debentures | 70,821 | 70,770 | 70,389 | |||||||||
Federal Home Loan Bank advances | — | 16,000 | 40,555 | |||||||||
Operating leases liabilities | 13,605 | 13,932 | 15,756 | |||||||||
Other liabilities | 22,811 | 19,666 | 36,480 | |||||||||
TOTAL LIABILITIES | 2,657,244 | 2,752,175 | 2,737,426 | |||||||||
Preferred stock, $1 par value per share; 10,000,000 shares authorized; no shares issued to date | — | — | — | |||||||||
Common stock, $1 par value per share; 30,000,000 shares authorized; 16,682,928, 16,672,511, and 16,634,572 shares issued and outstanding at September 30, 2021, June 30, 2021, and September 30, 2020, respectively | 16,683 | 16,673 | 16,635 | |||||||||
Additional paid-in capital | 234,696 | 234,390 | 232,738 | |||||||||
Retained earnings | 98,182 | 86,917 | 55,206 | |||||||||
Accumulated other comprehensive income | 6,754 | 8,309 | 2,507 | |||||||||
TOTAL SHAREHOLDERS’ EQUITY | 356,315 | 346,289 | 307,086 | |||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 3,013,559 | $ | 3,098,464 | $ | 3,044,512 | ||||||
This information is preliminary and based on company data available at the time of presentation. | ||||||||||||
RELIANT BANCORP, INC. CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED (Dollar amounts in thousands, except per share amounts) | ||||||||||||
Three Months Ended | ||||||||||||
September 30,
| June 30,
| September 30,
| ||||||||||
INTEREST INCOME | ||||||||||||
Interest and fees on loans | $ | 30,817 | $ | 31,183 | $ | 32,895 | ||||||
Interest and fees on loans held for sale | 1,184 | 1,807 | 1,037 | |||||||||
Interest on investment securities, taxable | 786 | 663 | 399 | |||||||||
Interest on investment securities, nontaxable | 928 | 1,216 | 1,186 | |||||||||
Restricted equity securities and other | 215 | 226 | 251 | |||||||||
TOTAL INTEREST INCOME | 33,930 | 35,095 | 35,768 | |||||||||
INTEREST EXPENSE | ||||||||||||
Deposits | ||||||||||||
Demand | 153 | 216 | 236 | |||||||||
Savings and money market deposit accounts | 441 | 647 | 1,162 | |||||||||
Time | 3,348 | 4,678 | 2,735 | |||||||||
Federal Home Loan Bank advances and other borrowings | 9 | 13 | 104 | |||||||||
Subordinated debentures | 980 | 980 | 992 | |||||||||
TOTAL INTEREST EXPENSE | 4,931 | 6,534 | 5,229 | |||||||||
NET INTEREST INCOME | 28,999 | 28,561 | 30,539 | |||||||||
PROVISION FOR LOAN LOSSES | — | — | 1,500 | |||||||||
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 28,999 | 28,561 | 29,039 | |||||||||
NONINTEREST INCOME | ||||||||||||
Service charges on deposit accounts | 1,678 | 1,656 | 1,583 | |||||||||
Gains on mortgage loans sold, net | 4,218 | 2,978 | 3,784 | |||||||||
Gain on securities transactions, net | 2,419 | 2,966 | — | |||||||||
Income from bank owned life insurance | 2,181 | 556 | 386 | |||||||||
Other noninterest income | 373 | 154 | 249 | |||||||||
TOTAL NONINTEREST INCOME | 10,869 | 8,310 | 6,002 | |||||||||
NONINTEREST EXPENSE | ||||||||||||
Salaries and employee benefits | 12,426 | 12,793 | 12,184 | |||||||||
Occupancy | 2,038 | 1,999 | 2,054 | |||||||||
Data processing and software | 2,265 | 2,262 | 2,240 | |||||||||
Professional fees | 526 | 358 | 775 | |||||||||
Regulatory fees | 328 | 343 | 365 | |||||||||
Merger expenses | 1,453 | — | 77 | |||||||||
Other operating expense | 3,345 | 2,729 | 2,639 | |||||||||
TOTAL NONINTEREST EXPENSE | 22,381 | 20,484 | 20,334 | |||||||||
INCOME BEFORE PROVISION FOR INCOME TAXES | 17,487 | 16,387 | 14,707 | |||||||||
INCOME TAX EXPENSE | 3,551 | 3,202 | 2,800 | |||||||||
CONSOLIDATED NET INCOME | 13,936 | 13,185 | 11,907 | |||||||||
NONCONTROLLING INTEREST IN NET (INCOME) LOSS OF SUBSIDIARY | (647 | ) | (140 | ) | (374 | ) | ||||||
NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ | 13,289 | $ | 13,045 | $ | 11,533 | ||||||
Basic net income attributable to common shareholders, per share | $ | 0.80 | $ | 0.79 | $ | 0.70 | ||||||
Diluted net income attributable to common shareholders, per share | $ | 0.79 | $ | 0.78 | $ | 0.69 | ||||||
This information is preliminary and based on company data available at the time of presentation. | ||||||||||||
RELIANT BANCORP, INC. SEGMENT FINANCIAL INFORMATION - UNAUDITED (Dollar Amounts in Thousands) | ||||||||||||||||
Three Months Ended September 30, 2021 | ||||||||||||||||
Commercial
| Residential
| Elimination
| Consolidated | |||||||||||||
Net interest income | $ | 28,164 | $ | 835 | $ | — | $ | 28,999 | ||||||||
Provision for loan losses | — | — | — | — | ||||||||||||
Noninterest income | 6,651 | 4,177 | 41 | 10,869 | ||||||||||||
Noninterest expense (excluding merger expense) | 16,551 | 4,377 | — | 20,928 | ||||||||||||
Merger expense | 1,453 | — | — | 1,453 | ||||||||||||
Income tax expense | 3,522 | 29 | — | 3,551 | ||||||||||||
Net income | 13,289 | 606 | 41 | 13,936 | ||||||||||||
Noncontrolling interest in net income of subsidiary | — | (606 | ) | (41 | ) | (647 | ) | |||||||||
Net income attributable to common shareholders | $ | 13,289 | $ | — | $ | — | $ | 13,289 | ||||||||
Three Months Ended June 30, 2021 | ||||||||||||||||
Commercial
| Residential
| Elimination
| Consolidated | |||||||||||||
Net interest income | $ | 27,440 | $ | 1,121 | $ | — | $ | 28,561 | ||||||||
Provision for loan losses | — | — | — | — | ||||||||||||
Noninterest income | 5,335 | 3,251 | (276 | ) | 8,310 | |||||||||||
Noninterest expense (excluding merger expense) | 16,570 | 3,914 | — | 20,484 | ||||||||||||
Merger expense | — | — | — | — | ||||||||||||
Income tax expense | 3,160 | 42 | — | 3,202 | ||||||||||||
Net income | 13,045 | 416 | (276 | ) | 13,185 | |||||||||||
Noncontrolling interest in net income of subsidiary | — | (416 | ) | 276 | (140 | ) | ||||||||||
Net income attributable to common shareholders | $ | 13,045 | $ | — | $ | — | $ | 13,045 | ||||||||
Three Months Ended September 30, 2020 | ||||||||||||||||
Commercial
| Residential
| Elimination
| Consolidated | |||||||||||||
Net interest income | $ | 29,731 | $ | 808 | $ | — | $ | 30,539 | ||||||||
Provision for loan losses | 1,500 | — | — | 1,500 | ||||||||||||
Noninterest income | 2,219 | 3,797 | (14 | ) | 6,002 | |||||||||||
Noninterest expense (excluding merger expense) | 16,067 | 4,190 | — | 20,257 | ||||||||||||
Merger expense | 77 | — | — | 77 | ||||||||||||
Income tax expense | 2,773 | 27 | — | 2,800 | ||||||||||||
Net (loss) income | 11,533 | 388 | (14 | ) | 11,907 | |||||||||||
Noncontrolling interest in net loss of subsidiary | — | (388 | ) | 14 | (374 | ) | ||||||||||
Net income attributable to common shareholders | $ | 11,533 | $ | — | $ | — | $ | 11,533 | ||||||||
This information is preliminary and based on company data available at the time of presentation. | ||||||||||||||||
RELIANT BANCORP, INC. SELECTED QUARTERLY FINANCIAL DATA - UNAUDITED | ||||||||||||
(Dollar amounts in thousands, except per share amounts) | Three months ended, | |||||||||||
September 30,
| June 30,
| September 30,
| ||||||||||
Per Common Share | ||||||||||||
Basic net income | $ | 0.80 | $ | 0.79 | $ | 0.70 | ||||||
Diluted net income | $ | 0.79 | $ | 0.78 | $ | 0.69 | ||||||
Adjusted diluted income(1) | $ | 0.87 | $ | 0.78 | $ | 0.70 | ||||||
Book value | $ | 21.36 | $ | 20.77 | $ | 18.46 | ||||||
Tangible book value(1) | $ | 17.50 | $ | 16.88 | $ | 14.65 | ||||||
Shares Outstanding | ||||||||||||
Basic weighted average common shares | 16,665,155 | 16,616,888 | 16,587,274 | |||||||||
Diluted weighted average common shares | 16,805,157 | 16,784,744 | 16,649,673 | |||||||||
Common shares outstanding at period end | 16,682,928 | 16,672,511 | 16,634,572 | |||||||||
Selected Balance Sheet Data | ||||||||||||
Loans, net of unearned income | $ | 2,389,833 | $ | 2,321,070 | $ | 2,357,898 | ||||||
Total assets | 3,013,559 | 3,098,464 | 3,044,512 | |||||||||
Customer deposits | 2,289,737 | 2,320,054 | 2,185,915 | |||||||||
Wholesale and institutional deposits | 257,968 | 309,786 | 379,587 | |||||||||
Total deposits | 2,547,705 | 2,629,840 | 2,565,502 | |||||||||
Total liabilities | 2,657,244 | 2,752,175 | 2,737,426 | |||||||||
Total shareholders' equity | 356,315 | 346,289 | 307,086 | |||||||||
Selected Balance Sheet Data - Quarterly Averages | ||||||||||||
Loans held for investment | $ | 2,360,073 | $ | 2,288,841 | $ | 2,337,958 | ||||||
Total assets | 3,036,777 | 3,088,329 | 2,991,818 | |||||||||
Interest-bearing liabilities | 2,032,296 | 2,113,993 | 2,108,428 | |||||||||
Total liabilities | 2,685,605 | 2,748,825 | 2,692,383 | |||||||||
Total shareholders' equity | 351,172 | 339,504 | 299,435 | |||||||||
Selected Performance Ratios | ||||||||||||
Return on average assets (2) | 1.74 | % | 1.69 | % | 1.53 | % | ||||||
Return on shareholders' equity (2) | 15.01 | % | 15.41 | % | 15.32 | % | ||||||
Return on average tangible common equity(1) (2) | 18.40 | % | 19.07 | % | 19.42 | % | ||||||
Average shareholders' equity to average assets | 11.56 | % | 10.99 | % | 10.01 | % | ||||||
Net interest margin (tax-equivalent basis) (2) | 4.22 | % | 4.14 | % | 4.54 | % | ||||||
Efficiency Ratio (tax-equivalent basis) | 54.8 | % | 54.1 | % | 54.0 | % | ||||||
Bank Segment efficiency ratio (1) | 46.4 | % | 49.1 | % | 48.6 | % | ||||||
Loans held for investment to deposits ratio | 93.8 | % | 88.3 | % | 91.9 | % | ||||||
Interest Rates and Yields (2) | ||||||||||||
Yield on interest-earning assets | 4.91 | % | 5.05 | % | 5.29 | % | ||||||
Yield on loans held for investment | 5.29 | % | 5.58 | % | 5.73 | % | ||||||
Cost of interest-bearing liabilities | 0.96 | % | 1.24 | % | 0.99 | % | ||||||
Adjusted cost of interest-bearing liabilities (1) | 0.52 | % | 0.70 | % | 0.99 | % | ||||||
Cost of funds | 0.74 | % | 0.97 | % | 0.79 | % | ||||||
Adjusted cost of funds (1) | 0.40 | % | 0.54 | % | 0.79 | % | ||||||
Cost of total deposits | 0.58 | % | 0.83 | % | 0.62 | % | ||||||
Adjusted cost of total deposits (1) | 0.26 | % | 0.41 | % | 0.62 | % | ||||||
Preliminary Consolidated Capital Ratios (3) | ||||||||||||
Tier 1 leverage | 10.04 | % | 9.47 | % | 8.72 | % | ||||||
Common equity tier 1 | 10.52 | % | 10.18 | % | 9.77 | % | ||||||
Tier 1 risk-based capital | 10.95 | % | 10.62 | % | 10.25 | % | ||||||
Total risk-based capital | 13.92 | % | 13.62 | % | 13.44 | % | ||||||
Selected Asset Quality Measures | ||||||||||||
Allowance for loan losses to total loans | 0.87 | % | 0.90 | % | 0.84 | % | ||||||
Allowance for loan losses plus unaccreted purchased loan discounts to total loans (1) | 1.38 | % | 1.46 | % | 1.64 | % | ||||||
Net (recoveries) charge offs | $ | (3 | ) | $ | (109 | ) | $ | (97 | ) | |||
Net (recoveries) charge offs to average loans (2) | — | % | (0.02 | )% | (0.02 | )% | ||||||
Total nonperforming loans held for investment (HFI) | $ | 5,302 | $ | 5,355 | $ | 6,802 | ||||||
Total nonperforming assets (4) | $ | 10,232 | $ | 9,726 | $ | 9,731 | ||||||
Nonperforming loans HFI to total loans HFI | 0.22 | % | 0.23 | % | 0.29 | % | ||||||
Nonperforming assets to total assets | 0.34 | % | 0.31 | % | 0.32 | % | ||||||
Nonperforming assets to total loans HFI and NPAs | 0.43 | % | 0.42 | % | 0.41 | % | ||||||
(1) | Certain measures are considered non-GAAP financial measures. See “Reconciliation of Non-GAAP Financial Measures - unaudited”. |
(2) | Data has been annualized. |
(3) | Current quarter capital ratios are estimated |
(4) | Nonperforming assets consist of nonperforming loans held for investment, nonperforming loans held for sale, repossessed assets, and other real estate. |
This information is preliminary and based on company data available at the time of presentation. |
RELIANT BANCORP, INC. YIELD TABLES - UNAUDITED FOR THE PERIODS INDICATED (Dollar Amounts in Thousands)
The following table sets forth the amount of our average balances, interest income or interest expense for each category of interest-earning assets and interest-bearing liabilities and the average interest rate for interest-earning assets and interest-bearing liabilities, net interest spread and net interest margin for the periods indicated below: | ||||||||||||||||||||
Three Months Ended
| Three Months Ended
| Three Months Ended
| ||||||||||||||||||
Average
| Rates /
| Interest
| Average
| Rates /
| Interest
| Average
| Rates /
| Interest
| ||||||||||||
Interest earning assets | ||||||||||||||||||||
Loans (2) (3) | $ | 2,360,073 | 4.96 | $ | 28,847 | $ | 2,288,841 | 5.12 | $ | 28,539 | $ | 2,337,958 | 5.34 | $ | 30,640 | |||||
Loan fees | — | 0.33 | 1,970 | — | 0.46 | 2,644 | — | 0.38 | 2,255 | |||||||||||
Loans with fees | 2,360,073 | 5.29 | 30,817 | 2,288,841 | 5.58 | 31,183 | 2,337,958 | 5.73 | 32,895 | |||||||||||
Mortgage loans held for sale | 134,245 | 3.50 | 1,184 | 232,850 | 3.11 | 1,807 | 103,729 | 3.98 | 1,037 | |||||||||||
Deposits with banks | 45,885 | 0.39 | 45 | 58,619 | 0.36 | 52 | 57,909 | 0.47 | 68 | |||||||||||
Investment securities - taxable | 106,433 | 2.93 | 786 | 73,368 | 3.62 | 663 | 67,569 | 2.35 | 399 | |||||||||||
Investment securities - tax-exempt (4) | 154,417 | 3.10 | 928 | 197,309 | 3.19 | 1,216 | 185,058 | 3.30 | 1,186 | |||||||||||
Restricted equity securities and other | 17,111 | 3.94 | 170 | 17,816 | 3.92 | 174 | 19,694 | 3.70 | 183 | |||||||||||
Total earning assets | 2,818,164 | 4.91 | 33,930 | 2,868,803 | 5.05 | 35,095 | 2,771,917 | 5.29 | 35,768 | |||||||||||
Nonearning assets | 218,613 | 219,526 | 219,901 | |||||||||||||||||
Total assets | $ | 3,036,777 | $ | 3,088,329 | $ | 2,991,818 | ||||||||||||||
Interest bearing liabilities | ||||||||||||||||||||
Interest bearing demand | $ | 411,796 | 0.15 | $ | 153 | $ | 412,117 | 0.21 | $ | 216 | $ | 272,506 | 0.34 | $ | 236 | |||||
Savings and money market | 980,069 | 0.18 | 441 | 972,082 | 0.27 | 647 | 786,589 | 0.59 | 1,162 | |||||||||||
Time deposits - retail | 440,390 | 0.74 | 825 | 443,512 | 0.94 | 1,042 | 715,310 | 0.97 | 1,744 | |||||||||||
Time deposits - wholesale | 118,520 | 8.45 | 2,523 | 192,954 | 7.56 | 3,636 | 223,095 | 1.77 | 991 | |||||||||||
Total interest-bearing deposits | 1,950,775 | 0.80 | 3,942 | 2,020,665 | 1.10 | 5,541 | 1,997,500 | 0.82 | 4,133 | |||||||||||
Federal Home Loan Bank advances and other borrowings | 10,724 | 0.33 | 9 | 22,582 | 0.23 | 13 | 40,567 | 1.02 | 104 | |||||||||||
Subordinated debt | 70,797 | 5.49 | 980 | 70,746 | 5.56 | 980 | 70,361 | 5.61 | 992 | |||||||||||
Total borrowed funds | 81,521 | 4.81 | 989 | 93,328 | 4.27 | 993 | 110,928 | 3.93 | 1,096 | |||||||||||
Total interest-bearing liabilities | 2,032,296 | 0.96 | 4,931 | 2,113,993 | 1.24 | 6,534 | 2,108,428 | 0.99 | 5,229 | |||||||||||
Net interest spread (5) | 3.95 | 28,999 | 3.81 | 28,561 | 4.30 | 30,539 | ||||||||||||||
Noninterest bearing deposits | 616,904 | (0.22 | ) | 597,188 | (0.27 | ) | 536,353 | (0.20 | ) | |||||||||||
Other noninterest bearing liabilities | 36,405 | 37,644 | 47,602 | |||||||||||||||||
Shareholders' equity | 351,172 | 339,504 | 299,435 | |||||||||||||||||
Total liabilities and shareholders' equity | $ | 3,036,777 | $ | 3,088,329 | $ | 2,991,818 | ||||||||||||||
Cost of funds | 0.74 | 0.97 | 0.79 | |||||||||||||||||
Net interest margin (6) | 4.22 | 4.14 | 4.54 | |||||||||||||||||
(1) | Calculated using daily averages. |
(2) | Average loan balances include nonaccrual loans. |
(3) | Yields on loans reflects tax-exempt interest and state tax credits received on low or zero percent interest loans made to construct low income housing of $669, $667, and $760, for the three months ended September 30, 2021, June 30, 2021, and September 30, 2020, respectively. |
(4) | Yields on tax-exempt securities are shown on a tax-equivalent basis. |
(5) | Net interest spread is calculated as the yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. |
(6) | Net interest margin is the result of net interest income calculated on a tax-equivalent basis divided by average interest earning assets for the period. |
This information is preliminary and based on company data available at the time of presentation. | |
RELIANT BANCORP, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES-UNAUDITED (Dollar Amounts in Thousands, Except Per Share Amounts) | ||||||||||||
Three Months Ended | ||||||||||||
September 30, 2021 | June 30, 2021 | September 30, 2020 | ||||||||||
Adjusted net interest margin: | ||||||||||||
Net interest income | $ | 28,999 | $ | 28,561 | $ | 30,539 | ||||||
Add: tax equivalent interest income | 947 | 1,021 | 1,107 | |||||||||
Add: swap termination fees | 2,290 | 2,859 | — | |||||||||
Less: purchase accounting adjustments | (993 | ) | (1,839 | ) | (3,868 | ) | ||||||
Adjusted net interest income | 31,243 | 30,602 | 27,778 | |||||||||
Average earning assets | $ | 2,818,164 | $ | 2,868,803 | $ | 2,771,917 | ||||||
Net interest margin-tax equivalent | 4.22 | % | 4.14 | % | 4.54 | % | ||||||
Adjusted net interest margin | 4.40 | % | 4.28 | % | 3.99 | % | ||||||
Adjusted net income (1): | ||||||||||||
Net income attributable to common shareholders | $ | 13,289 | $ | 13,045 | $ | 11,533 | ||||||
Add: merger related expenses | 1,453 | — | 77 | |||||||||
Less: income tax impact of merger related expenses | (48 | ) | — | (10 | ) | |||||||
Adjusted net income | $ | 14,694 | $ | 13,045 | $ | 11,600 | ||||||
Adjusted diluted earnings per share: | ||||||||||||
Adjusted net income | $ | 14,694 | $ | 13,045 | $ | 11,600 | ||||||
Weighted average shares - diluted | 16,805,157 | 16,784,744 | 16,649,673 | |||||||||
Diluted earnings per share | $ | 0.79 | $ | 0.78 | $ | 0.69 | ||||||
Adjusted diluted earnings per share | $ | 0.87 | $ | 0.78 | $ | 0.70 | ||||||
Adjusted annualized return on average assets: | ||||||||||||
Adjusted net income | $ | 14,694 | $ | 13,045 | $ | 11,600 | ||||||
Average assets | 3,036,777 | 3,088,329 | 2,991,818 | |||||||||
Annualized return on average assets | 1.74 | % | 1.69 | % | 1.53 | % | ||||||
Adjusted annualized return on average assets | 1.92 | % | 1.69 | % | 1.54 | % | ||||||
Adjusted annualized return on average equity: | ||||||||||||
Adjusted net income | $ | 14,694 | $ | 13,045 | $ | 11,600 | ||||||
Average total shareholders' equity | 351,172 | 339,504 | 299,435 | |||||||||
Annualized return on average equity | 15.01 | % | 15.41 | % | 15.32 | % | ||||||
Adjusted annualized return on average equity | 16.60 | % | 15.41 | % | 15.41 | % | ||||||
Adjusted annualized return on average tangible common equity: | ||||||||||||
Average total shareholders' equity | $ | 351,172 | $ | 339,504 | $ | 299,435 | ||||||
Less: average intangible assets | (64,607 | ) | (65,088 | ) | (63,212 | ) | ||||||
Average tangible common equity | $ | 286,565 | $ | 274,416 | $ | 236,223 | ||||||
Adjusted net income | 14,694 | 13,045 | 11,600 | |||||||||
Annualized return on average tangible common equity | 18.40 | % | 19.07 | % | 19.42 | % | ||||||
Adjusted annualized return on average tangible common equity | 20.34 | % | 19.07 | % | 19.54 | % | ||||||
Adjusted pre-tax pre-provision income: | ||||||||||||
Income before provision for income taxes | $ | 17,487 | $ | 16,387 | $ | 14,707 | ||||||
Add: merger related expenses | 1,453 | — | 77 | |||||||||
Add: provision for loan losses | — | — | 1,500 | |||||||||
Adjusted pre-tax pre-provision income | $ | 18,940 | $ | 16,387 | $ | 16,284 | ||||||
Tangible common equity to tangible assets: | ||||||||||||
Tangible common equity: | ||||||||||||
Total shareholders' equity | $ | 356,315 | $ | 346,289 | $ | 307,086 | ||||||
Less: intangible assets | (64,374 | ) | (64,830 | ) | (63,326 | ) | ||||||
Tangible common equity | $ | 291,941 | $ | 281,459 | $ | 243,760 | ||||||
Tangible assets: | ||||||||||||
Total assets | $ | 3,013,559 | $ | 3,098,464 | $ | 3,044,512 | ||||||
Less: intangible assets | (64,374 | ) | (64,830 | ) | (63,326 | ) | ||||||
Tangible assets | $ | 2,949,185 | $ | 3,033,634 | $ | 2,981,186 | ||||||
Total shareholders' equity to total assets | 11.82 | % | 11.18 | % | 10.09 | % | ||||||
Tangible common equity to tangible assets | 9.90 | % | 9.28 | % | 8.18 | % | ||||||
Tangible book value per share: | ||||||||||||
Tangible common equity | $ | 291,941 | $ | 281,459 | $ | 243,760 | ||||||
Total shares of common stock outstanding | 16,682,928 | 16,672,511 | 16,634,572 | |||||||||
Book value per common share | $ | 21.36 | $ | 20.77 | $ | 18.46 | ||||||
Tangible book value per share | $ | 17.50 | $ | 16.88 | $ | 14.65 | ||||||
Allowance for loan losses plus unaccreted loan purchase discounts: | ||||||||||||
Allowance for loan losses | $ | 20,897 | $ | 20,894 | $ | 19,834 | ||||||
Unaccreted loan purchase discounts | 11,993 | 12,980 | 18,939 | |||||||||
Allowance for loan losses plus unaccreted loan purchase discounts: | $ | 32,890 | $ | 33,874 | $ | 38,773 | ||||||
Total loans | 2,389,833 | 2,321,070 | 2,357,898 | |||||||||
Allowance for loan losses plus unaccreted purchased loan discounts to total loans | 1.38 | % | 1.46 | % | 1.64 | % | ||||||
Allowance for loan losses to total loans | 0.87 | % | 0.90 | % | 0.84 | % | ||||||
Bank segment adjusted net income: | ||||||||||||
Bank segment net income | $ | 13,289 | $ | 13,045 | $ | 11,533 | ||||||
Add: merger related expenses | 1,453 | — | 77 | |||||||||
Less: income tax impact of merger related expenses | (48 | ) | — | (10 | ) | |||||||
Bank segment adjusted net income | $ | 14,694 | $ | 13,045 | $ | 11,600 | ||||||
Bank segment adjusted noninterest expense: | ||||||||||||
Bank segment noninterest expense | $ | 18,004 | $ | 16,570 | $ | 16,144 | ||||||
Add: merger related expenses | (1,453 | ) | — | (77 | ) | |||||||
Bank segment adjusted noninterest expense | $ | 16,551 | $ | 16,570 | $ | 16,067 | ||||||
Bank segment adjusted efficiency ratio: | ||||||||||||
Bank segment adjusted total revenues: | ||||||||||||
Bank segment net interest income | $ | 28,164 | $ | 27,440 | $ | 29,731 | ||||||
Add: Tax equivalent interest income | 947 | 1,021 | 1,107 | |||||||||
Add: Bank segment noninterest income | 6,651 | 5,335 | 2,219 | |||||||||
Less: Gains on sale of securities, OREO, premises and equipment (2) | (2,405 | ) | (2,922 | ) | 9 | |||||||
Add: Swap termination fee (2) | 2,290 | 2,859 | — | |||||||||
Bank segment adjusted total revenues | $ | 35,647 | $ | 33,733 | $ | 33,066 | ||||||
Bank segment efficiency ratio | 51.7 | % | 50.6 | % | 50.5 | % | ||||||
Bank segment adjusted efficiency ratio | 46.4 | % | 49.1 | % | 48.6 | % | ||||||
Adjusted cost of funds: | ||||||||||||
Adjusted interest expense: | ||||||||||||
Interest expense | $ | 4,931 | $ | 6,534 | $ | 5,229 | ||||||
Less: Swap termination fees | (2,290 | ) | (2,859 | ) | — | |||||||
Adjusted interest expense | $ | 2,641 | $ | 3,675 | $ | 5,229 | ||||||
Average funds | 2,649,200 | 2,711,181 | 2,644,781 | |||||||||
Cost of funds | 0.74 | % | 0.97 | % | 0.79 | % | ||||||
Adjusted cost of funds | 0.40 | % | 0.54 | % | 0.79 | % | ||||||
Adjusted cost of interest-bearing liabilities: | ||||||||||||
Adjusted interest expense | $ | 2,641 | $ | 3,675 | $ | 5,229 | ||||||
Average interest-bearing liabilities | 2,032,296 | 2,113,993 | 2,108,428 | |||||||||
Cost of interest-bearing liabilities | 0.96 | % | 1.24 | % | 0.99 | % | ||||||
Adjusted cost of interest-bearing liabilities | 0.52 | % | 0.70 | % | 0.99 | % | ||||||
Adjusted cost of deposits: | ||||||||||||
Adjusted deposit expense: | ||||||||||||
Deposit expense | $ | 3,942 | $ | 5,541 | $ | 4,133 | ||||||
Less: Swap termination fees | (2,290 | ) | (2,859 | ) | — | |||||||
Adjusted deposit expense | $ | 1,652 | $ | 2,682 | $ | 4,133 | ||||||
Average deposits | 2,567,679 | 2,617,853 | 2,533,853 | |||||||||
Cost of deposits | 0.58 | % | 0.83 | % | 0.62 | % | ||||||
Adjusted cost of deposits | 0.26 | % | 0.41 | % | 0.62 | % | ||||||
(1) | The swap termination fees included in the adjusted net interest income calculation in the second and third quarters of 2021 were done so in conjunction with securities sales thereby nullifying the effects on net income. Therefore, we have not adjusted for these transactions as adjusted net income. |
(2) | Securities sold in the second and third quarters of 2021 were done in conjunction with the swap termination fees. Therefore, we have adjusted for both sides of this transaction. |
This information is preliminary and based on company data available at the time of presentation. | |
View source version on businesswire.com: https://www.businesswire.com/news/home/20211019006066/en/
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