NEW ORLEANS, Nov. 02, 2015 (GLOBE NEWSWIRE) — First NBC Bank Holding Company (NASDAQ:FNBC), the holding company for First NBC Bank (“Company”), today announced financial results for the third quarter of 2015. For the quarter ended September 30, 2015, the Company reported net income available to common shareholders of $17.7 million, or $0.95 per share, as compared to $16.8 million, or $0.90 per share, for the second quarter of 2015 and $14.0 million, or $0.75 per share, for the third quarter of 2014.
The Company’s earnings per share on a diluted basis were $0.92, $0.88, and $0.73 per diluted share, for the third quarter of 2015, second quarter of 2015, and third quarter of 2014, respectively. This represents an increase of $0.04 per diluted share, or 4.5%, over the second quarter of 2015, and an increase of $0.19 per diluted share, or 26.0%, over the third quarter of 2014.
Performance Highlights
• The Company had total assets of $4.3 billion at September 30, 2015, an increase of 15.8% from December 31, 2014.
• Total loans increased $344.6 million, or 12.4%, from December 31, 2014.
• Total deposits increased $496.1 million, or 15.9%, from December 31, 2014.
• The Company’s investment in tax credit entities increased $30.7 million, or 21.8%, from December 31, 2014, primarily from increased investment in Federal Historic Rehabilitation tax credit projects.
• Net interest income increased $2.7 million, or 10.3%, from the linked quarter of 2015, and increased $1.0 million, or 3.7%, from the third quarter of 2014.
• The Company recorded a gain of $1.5 million in other noninterest income from the sale of a portion of its ownership interest in a certain Federal Historic Rehabilitation tax credit project. The Company retained the Federal Historic Rehabilitation tax credits generated by the project as these were not subject to recapture.
Loans
The Company’s loans totaled $3.1 billion at September 30, 2015, an increase of $185.5 million, or 6.3%, from June 30, 2015, and an increase of $344.6 million, or 12.4%, from December 31, 2014. Loan growth continues to be driven primarily by increases in construction and commercial loans. The increase in the Company’s construction loan portfolio of 18.5% from June 30, 2015 and 40.8% from December 31, 2014 was due primarily to the funding of construction loans related to hotels, residential real estate development, and federal tax credit related projects.
The increase in the Company’s commercial loan portfolio of 7.3% from June 30, 2015 and 13.2% from December 31, 2014 was due in part to increases in all segments of the portfolio. The Company does have exposure to the oil and gas industry in its commercial loan portfolio. At September 30, 2015, the Company’s direct oil and gas commercial loan portfolio was approximately $142.5 million, or 4.6%, of its total loan portfolio, with an additional $5.7 million in outstanding loan commitments. Of this amount, the Company’s exposure to exploration and production in its oil and gas portfolio was approximately $74.2 million with outstanding commitments of $3.0 million. The Company also has exposure to indirect oil and gas loans in its portfolio of $93.8 million with outstanding commitments of $5.3 million. The Company is actively monitoring both its direct and indirect oil and gas related credits.
The following table sets forth the composition of the Company’s loan portfolio as of the dates indicated:
| (In thousands) | September 30, 2015 | June 30, 2015 | % Change | December 31, 2014 | % Change | ||||||||||||
| Construction | $ | 461,459 | $ | 389,552 | 18.5 | % | $ | 327,677 | 40.8 | % | |||||||
| Commercial real estate | 1,313,173 | 1,287,105 | 2.0 | 1,264,371 | 3.9 | ||||||||||||
| Consumer real estate | 156,498 | 149,273 | 4.8 | 132,950 | 17.7 | ||||||||||||
| Commercial and industrial | 1,166,889 | 1,087,224 | 7.3 | 1,030,629 | 13.2 | ||||||||||||
| Consumer | 20,835 | 20,159 | 3.4 | 18,637 | 11.8 | ||||||||||||
| Total loans | $ | 3,118,854 | $ | 2,933,313 | 6.3 | % | $ | 2,774,264 | 12.4 | % | |||||||
Asset Quality
Nonperforming assets totaled $43.9 million at September 30, 2015, an increase of $2.5 million from June 30, 2015 and an increase of $15.2 million from December 31, 2014. During the third quarter of 2015, total nonperforming loans increased $2.3 million, and other real estate owned increased $0.1 million. Nonperforming assets as a percent of total loans, other real estate owned and other assets owned was 1.40% at September 30, 2015, down 1 basis point from June 30, 2015 and up 37 basis points from December 31, 2014.
The allowance for loan losses totaled $53.1 million at September 30, 2015, an increase of $2.7 million from June 30, 2015, and $10.7 million from December 31, 2014. The increase in the allowance for loan losses compared to the linked quarter of 2015 was attributable to a $3.0 million provision for loan loss, partially offset by $0.3 million in net charge-offs during the third quarter of 2015. The ratio of allowance for loan losses to period-end loans was 1.70% at September 30, 2015, compared to 1.72% at June 30, 2015 and 1.53% at December 31, 2014.
Deposits
Total deposits at September 30, 2015 were $3.6 billion, an increase of $220.2 million, or 6.5%, from June 30, 2015 and an increase of $496.1 million, or 15.9%, from December 31, 2014. Total deposits increased compared to the linked quarter due to an increase in NOW accounts primarily from a new public funds relationship during the third quarter of 2015. The growth in the Company’s deposits of 15.9% from December 31, 2014 is due primarily to organic deposit growth of 14.1% across all deposit categories and 1.8% from assumption of deposit liabilities from the Crestview bank transaction in the first quarter of 2015. The Company’s tiered pricing strategy continues to be the catalyst for the Company’s continued deposit growth.
The following table sets forth the composition of the Company’s deposits as of the dates indicated:
| (In thousands) | September 30, 2015 | June 30, 2015 | % Change | December 31, 2014 | % Change | ||||||||||||
| Noninterest-bearing | $ | 416,405 | $ | 390,001 | 6.8 | % | $ | 364,534 | 14.2 | % | |||||||
| NOW accounts | 691,261 | 586,596 | 17.8 | 476,825 | 45.0 | ||||||||||||
| Money market accounts | 1,175,184 | 1,118,679 | 5.1 | 1,055,505 | 11.3 | ||||||||||||
| Savings deposits | 57,079 | 55,982 | 2.0 | 49,634 | 15.0 | ||||||||||||
| Certificates of deposit | 1,276,989 | 1,245,487 | 2.5 | 1,174,352 | 8.7 | ||||||||||||
| Total deposits | $ | 3,616,918 | $ | 3,396,745 | 6.5 | % | $ | 3,120,850 | 15.9 | % | |||||||
Net Interest Income
Net interest income for the third quarter ended September 30, 2015 totaled $28.8 million, an increase of $2.7 million, or 10.3%, from the second quarter of 2015, and an increase of $1.0 million, or 3.7%, from the third quarter of 2014. The increase in net interest income compared to the linked quarter was due primarily to the increase in interest income on loans of $3.6 million offset by an increase in interest expense of $0.8 million. The Company’s net interest margin was 3.04% for the quarter ended September 30, 2015, 18 basis points higher than the second quarter of 2015 and 33 basis points lower than the third quarter of 2014. The increase in the average yield on loans of 33 basis points compared to the linked quarter is due primarily to an increase in the average loan balance of $60.6 million, specifically, average commercial loans, which were at higher rates compared to the linked quarter. The decrease of 13 basis points compared to the same period of 2014 is due to the composition of the Company’s loan portfolio which has been more heavily weighted to variable rate loans than fixed rate loans and the timing of the execution of Prime rate hedges to mitigate this shift compared to the third quarter of 2014. As the Company’s loan portfolio continues to grow at a double digit pace, the Company has had to increase the notional amount of its Prime rate cash flow hedges. The Company currently has $325.0 million in notional amount of Prime rate swaps compared to $250.0 million in notional amount during the third quarter of 2014, an increase of $75.0 million in notional amounts. These Prime rate hedges are designed to mitigate the shift in the Company’s loan portfolio to a more evenly balanced portfolio. The Company issued subordinated debentures during the first quarter of 2015 due to the favorable rates in the market and as a good source of capital to continue its growth. Until the funds from the subordinated debenture offering are fully deployed in future periods, they will continue to be a drag on the net interest margin. Excluding the impact of the subordinated debt issuance, the Company’s net interest margin for the third quarter of 2015 would have been 3.09%, compared to 2.91% in the linked quarter of 2015. The Company did invest the excess funds in higher rate accounts during the second quarter of 2015 which increased the average yield by 1 basis point compared to the linked quarter and 8 basis points compared to the third quarter of 2014. Average interest-earning assets increased $100.4 million over the second quarter of 2015 and $489.8 million over the third quarter of 2014. The cost of interest-bearing deposits increased 1 basis point compared to the second quarter of 2015 due to an increase in average NOW deposits in the higher balance tiers and decreased 9 basis points over the third quarter of 2014 due to the tiered pricing on all of its deposit products (including certificates of deposit).
The following tables set forth the Company’s average volume and rates on its interest-earning assets and interest-bearing liabilities for the periods indicated:
| For the Three Months Ended | ||||||||||||||||||||
| September 30, 2015 | June 30, 2015 | September 30, 2014 | ||||||||||||||||||
| (In thousands) | Average Balance |
Average Yield/Rate |
Average Balance |
Average Yield/Rate |
Average Balance |
Average Yield/Rate |
||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||
| Short-term investments | $ | 187,282 | 0.28 | % | $ | 140,189 | 0.27 | % | $ | 12,804 | 0.20 | % | ||||||||
| Investment in short-term receivables | 223,728 | 2.54 | % | 229,804 | 2.64 | % | 233,044 | 2.85 | % | |||||||||||
| Investment securities | 337,805 | 2.58 | % | 339,041 | 2.62 | % | 367,135 | 2.51 | % | |||||||||||
| Loans | 3,007,096 | 5.05 | % | 2,946,483 | 4.72 | % | 2,653,083 | 5.18 | % | |||||||||||
| Total interest-earning assets | $ | 3,755,911 | 4.44 | % | $ | 3,655,517 | 4.23 | % | $ | 3,266,066 | 4.70 | % | ||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||
| Savings | $ | 54,512 | 0.64 | % | $ | 55,475 | 0.63 | % | $ | 51,360 | 0.75 | % | ||||||||
| Money market deposits | 1,143,464 | 1.21 | % | 1,114,547 | 1.20 | % | 909,405 | 1.35 | % | |||||||||||
| NOW accounts | 669,915 | 1.08 | % | 568,084 | 1.03 | % | 485,143 | 1.17 | % | |||||||||||
| Certificates of deposit | 1,040,785 | 1.83 | % | 1,002,521 | 1.82 | % | 979,988 | 1.81 | % | |||||||||||
| CDARS® | 227,315 | 2.23 | % | 221,870 | 2.24 | % | 211,028 | 2.20 | % | |||||||||||
| Total interest-bearing deposits | $ | 3,135,991 | 1.45 | % | $ | 2,962,497 | 1.44 | % | $ | 2,636,924 | 1.54 | % | ||||||||
| Fed funds purchased and repurchase agreements | 108,205 | 1.40 | % | 118,935 | 1.40 | % | 110,594 | 1.42 | % | |||||||||||
| Borrowings | 103,392 | 5.26 | % | 103,392 | 5.14 | % | 61,143 | 1.58 | % | |||||||||||
| Total interest-bearing liabilities | $ | 3,347,588 | 1.57 | % | $ | 3,184,824 | 1.56 | % | $ | 2,808,661 | 1.54 | % | ||||||||
| Net interest spread | 2.87 | % | 2.67 | % | 3.16 | % | ||||||||||||||
| Net interest margin | 3.04 | % | 2.86 | % | 3.37 | % | ||||||||||||||
| For the Nine Months Ended | |||||||||||||
| September 30, 2015 | September 30, 2014 | ||||||||||||
| (In thousands) | Average Balance |
Average Yield/Rate |
Average Balance |
Average Yield/Rate |
|||||||||
| Interest-earning assets: | |||||||||||||
| Short-term investments | $ | 145,835 | 0.26 | % | $ | 32,056 | 0.20 | % | |||||
| Investment in short-term receivables | 229,037 | 2.71 | % | 227,924 | 2.79 | % | |||||||
| Investment securities | 340,632 | 2.56 | % | 370,000 | 2.55 | % | |||||||
| Loans | 2,933,935 | 4.93 | % | 2,535,956 | 5.23 | % | |||||||
| Total interest-earning assets | $ | 3,649,439 | 4.38 | % | $ | 3,165,936 | 4.69 | % | |||||
| Interest-bearing liabilities: | |||||||||||||
| Savings | $ | 54,452 | 0.63 | % | $ | 53,091 | 0.80 | % | |||||
| Money market deposits | 1,117,171 | 1.21 | % | 809,025 | 1.37 | % | |||||||
| NOW accounts | 589,705 | 1.04 | % | 505,247 | 1.14 | % | |||||||
| Certificates of deposit | 1,006,763 | 1.82 | % | 1,009,622 | 1.82 | % | |||||||
| CDARS® | 222,941 | 2.24 | % | 197,553 | 2.19 | % | |||||||
| Total interest-bearing deposits | $ | 2,991,032 | 1.45 | % | $ | 2,574,538 | 1.55 | % | |||||
| Fed funds purchased and repurchase agreements | 116,278 | 1.41 | % | 100,776 | 1.48 | % | |||||||
| Borrowings | 92,550 | 5.07 | % | 58,345 | 1.90 | % | |||||||
| Total interest-bearing liabilities | $ | 3,199,860 | 1.55 | % | $ | 2,733,659 | 1.56 | % | |||||
| Net interest spread | 2.83 | % | 3.13 | % | |||||||||
| Net interest margin | 3.02 | % | 3.34 | % | |||||||||
Noninterest Income
Noninterest income for the third quarter of 2015 totaled $3.1 million, a decrease of $0.4 million, or 11.5%, compared to the linked quarter, and an increase of $0.1 million, or 3.8%, compared to the third quarter of 2014. The decrease in noninterest income for the linked quarter was due primarily to decreases in state tax credits earned of $0.2 million and loss on the sale on other assets of $0.2 million from the sale of an acquired branch.
The increase in noninterest income for the third quarter of 2015 compared to the third quarter of 2014 resulted primarily from an increase of $0.9 million in other noninterest income primarily from the $1.5 million gain from the sale of a portion of the Company’s ownership interest in a certain Federal Rehabilitation Historic tax credit project and $0.4 million in rental income from its real estate subsidiary offset by a decrease in other noninterest income primarily due to a decrease of $0.9 million from the realized loss on a SBIC investment. The increase in noninterest income was offset by decreases of $0.5 million from the gain on sale of loans related to the guaranteed portion of SBA/USDA loans sold in the third quarter of 2014, $0.2 million from the loss on sale of other assets from the sale of an acquired branch, and $0.1 million in state tax credits earned.
Noninterest Expense
Noninterest expense for the three month period ended September 30, 2015 totaled $26.0 million, an increase of $2.9 million, or 12.4%, compared to the linked quarter, and an increase of $5.9 million, or 29.5%, compared to the same three month period of 2014. The increase over the linked quarter was due primarily to increases in impairment of investment in tax credit entities of $3.5 million, occupancy and equipment expenses of $0.4 million, and professional fees of $0.3 million, offset by decreases in salaries and employee benefits of $0.6 million due primarily to the increase in deferred salary expenses associated with the growth in new loan originations, taxes, licenses and FDIC assessments of $0.2 million, and other noninterest expense of $0.6 million due primarily to expenses related to the Company’s real estate subsidiary.
The increase over the prior year three month period was due to increases in all components of noninterest expense due to the organic growth of the Company, its increased investment in federal tax credit programs, as well as the Crestview bank transaction in the first quarter of 2015.
Taxes
The Company’s tax benefit for the quarter ended September 30, 2015 was $14.8 million, an increase of $1.4 million compared to the second quarter of 2015, and $8.2 million compared to the third quarter of 2014. The increase continues to be driven by the Company’s increased investment in projects that generate Federal Historic Rehabilitation tax credits.
The Company expects to experience an effective tax rate below the statutory rate of 35% due primarily to its receipt of Federal New Markets Tax Credits, Low-Income Housing Tax Credits and Federal Historic Rehabilitation Tax Credits.
Shareholders’ Equity
Shareholders’ equity totaled $486.2 million at September 30, 2015, an increase of $49.8 million from year-end 2014. The increase was primarily attributable to the Company’s earnings over the period.
About First NBC Bank Holding Company
First NBC Bank Holding Company, headquartered in New Orleans, Louisiana, offers a broad range of financial services through its wholly-owned banking subsidiary, First NBC Bank, a Louisiana state non-member bank. The Company’s primary markets are the New Orleans metropolitan area, Mississippi Gulf Coast, and the Florida panhandle. The Company operates 35 full service banking offices located throughout its markets, along with a loan production office in Gulfport, Mississippi, and had 525 employees at September 30, 2015.
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles in the United States of America, or GAAP. These measures typically adjust GAAP performance measures to adjust income available to common shareholders for certain significant activities or transactions that are infrequent in nature. Management believes these non-GAAP financial measures provide information useful to investors in understanding the Company’s financial results, and the Company believes that its presentation, together with the accompanying reconciliations, provide a more complete understanding of factors and trends affecting the Company’s business and allow investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results, and the Company strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names. A reconciliation of the non-GAAP financial measures disclosed in this press release to the comparable GAAP financial measures is included at the end of the financial statement tables.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the Company’s current views with respect to, among other things, future events and financial performance. The Company generally identifies forward-looking statements by terminology such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of those words or other comparable words. Any forward-looking statements contained in this press release are based on the historical performance of the Company and its subsidiaries or on the Company’s current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by the Company that the future plans, estimates or expectations by the Company will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to the Company’s operations, financial results, financial condition, business prospects, growth strategy and liquidity. If one or more of these or other risks or uncertainties materialize, or if the Company’s underlying assumptions prove to be incorrect, the Company’s actual results may vary materially from those indicated in these statements. These factors should not be construed as exhaustive. The Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements. Information on these factors can be found in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2014, and other reports and statements the Company has filed with Securities and Exchange Commission (“SEC”), which are available at the SEC’s website (www.sec.gov).
| FIRST NBC BANK HOLDING COMPANY | |||||||
| CONSOLIDATED BALANCE SHEETS (UNAUDITED) | |||||||
| (In thousands) | September 30, 2015 | December 31, 2014 | |||||
| Assets | |||||||
| Cash and due from banks | $ | 33,759 | $ | 32,484 | |||
| Short-term investments | 179,526 | 18,404 | |||||
| Investment in short-term receivables | 182,945 | 237,135 | |||||
| Investment securities available for sale, at fair value | 273,702 | 247,647 | |||||
| Investment securities held to maturity | 83,319 | 89,076 | |||||
| Mortgage loans held for sale | 2,647 | 1,622 | |||||
| Loans, net of allowance for loan losses of $53,076 and $42,336, respectively | 3,065,778 | 2,731,928 | |||||
| Bank premises and equipment, net | 58,549 | 52,881 | |||||
| Accrued interest receivable | 11,919 | 11,451 | |||||
| Goodwill and other intangible assets | 8,942 | 7,831 | |||||
| Investment in real estate properties | 51,727 | 12,771 | |||||
| Investment in tax credit entities | 171,609 | 140,913 | |||||
| Cash surrender value of bank-owned life insurance | 48,342 | 47,289 | |||||
| Other real estate | 4,575 | 5,549 | |||||
| Deferred tax asset | 127,855 | 83,461 | |||||
| Other assets | 39,852 | 30,175 | |||||
| Total assets | $ | 4,345,046 | $ | 3,750,617 | |||
| Liabilities and equity | |||||||
| Deposits: | |||||||
| Noninterest-bearing | $ | 416,405 | $ | 364,534 | |||
| Interest-bearing | 3,200,513 | 2,756,316 | |||||
| Total deposits | 3,616,918 | 3,120,850 | |||||
| Repurchase agreements | 93,775 | 117,991 | |||||
| Long-term borrowings | 103,392 | 40,000 | |||||
| Accrued interest payable | 7,503 | 6,650 | |||||
| Other liabilities | 37,267 | 28,752 | |||||
| Total liabilities | 3,858,855 | 3,314,243 | |||||
| Shareholders’ equity: | |||||||
| Preferred stock | |||||||
| Convertible preferred stock Series C – no par value; 1,680,219 shares authorized; No shares outstanding at September 30, 2015 and 364,983 shares issued and outstanding at December 31, 2014 | — | 4,471 | |||||
| Preferred stock Series D – no par value; 37,935 shares authorized, issued and outstanding at September 30, 2015 and December 31, 2014 | 37,935 | 37,935 | |||||
| Common stock- par value $1 per share; 100,000,000 shares authorized; 19,068,301 shares issued and outstanding at September 30, 2015 and 18,576,488 shares issued and outstanding at December 31, 2014 | 19,068 | 18,576 | |||||
| Additional paid-in capital | 242,376 | 239,528 | |||||
| Accumulated earnings | 206,353 | 155,599 | |||||
| Accumulated other comprehensive loss, net | (19,543 | ) | (19,737 | ) | |||
| Total shareholders’ equity | 486,189 | 436,372 | |||||
| Noncontrolling interest | 2 | 2 | |||||
| Total equity | 486,191 | 436,374 | |||||
| Total liabilities and equity | $ | 4,345,046 | $ | 3,750,617 | |||
| FIRST NBC BANK HOLDING COMPANY | |||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | |||||||||||||||
| For the Three Months Ended | For the Nine Months Ended | ||||||||||||||
| September 30, | September 30, | ||||||||||||||
| (In thousands, except per share data) | 2015 | 2014 | 2015 | 2014 | |||||||||||
| Interest income: | |||||||||||||||
| Loans, including fees | $ | 38,270 | $ | 34,664 | $ | 108,203 | $ | 99,160 | |||||||
| Investment securities | 2,193 | 2,323 | 6,512 | 7,053 | |||||||||||
| Investment in short-term receivables | 1,434 | 1,675 | 4,638 | 4,761 | |||||||||||
| Short-term investments | 130 | 6 | 288 | 48 | |||||||||||
| 42,027 | 38,668 | 119,641 | 111,022 | ||||||||||||
| Interest expense: | |||||||||||||||
| Deposits | 11,476 | 10,268 | 32,382 | 29,921 | |||||||||||
| Borrowings and securities sold under repurchase agreements | 1,752 | 640 | 4,732 | 1,943 | |||||||||||
| 13,228 | 10,908 | 37,114 | 31,864 | ||||||||||||
| Net interest income | 28,799 | 27,760 | 82,527 | 79,158 | |||||||||||
| Provision for loan losses | 3,000 | 3,000 | 11,600 | 9,000 | |||||||||||
| Net interest income after provision for loan losses | 25,799 | 24,760 | 70,927 | 70,158 | |||||||||||
| Noninterest income: | |||||||||||||||
| Service charges on deposit accounts | 596 | 548 | 1,740 | 1,605 | |||||||||||
| Investment securities gain (loss), net | — | 79 | (50 | ) | 135 | ||||||||||
| Gain (loss) on assets sold, net | (273 | ) | (76 | ) | (262 | ) | 63 | ||||||||
| Gain on sale of loans, net | 31 | 579 | 147 | 649 | |||||||||||
| Cash surrender value income on bank-owned life insurance | 349 | 352 | 1,054 | 748 | |||||||||||
| State tax credits earned | 495 | 597 | 1,682 | 2,358 | |||||||||||
| Community Development Entity fees earned | 183 | 109 | 439 | 984 | |||||||||||
| ATM fee income | 529 | 490 | 1,553 | 1,468 | |||||||||||
| Other | 1,238 | 356 | 2,912 | 1,316 | |||||||||||
| 3,148 | 3,034 | 9,215 | 9,326 | ||||||||||||
| Noninterest expense: | |||||||||||||||
| Salaries and employee benefits | 7,122 | 6,456 | 21,718 | 17,795 | |||||||||||
| Occupancy and equipment expenses | 3,377 | 2,737 | 9,314 | 8,005 | |||||||||||
| Professional fees | 2,002 | 1,628 | 5,844 | 5,038 | |||||||||||
| Taxes, licenses and FDIC assessments | 1,536 | 1,240 | 4,468 | 3,782 | |||||||||||
| Impairment of investment in tax credit entities | 6,160 | 3,974 | 13,659 | 10,178 | |||||||||||
| Write-down of foreclosed assets | 29 | 1 | 129 | 187 | |||||||||||
| Data processing | 1,554 | 1,207 | 4,557 | 3,446 | |||||||||||
| Advertising and marketing | 727 | 685 | 2,418 | 1,819 | |||||||||||
| Other | 3,451 | 2,119 | 9,454 | 5,702 | |||||||||||
| 25,958 | 20,047 | 71,561 | 55,952 | ||||||||||||
| Income before income taxes | 2,989 | 7,747 | 8,581 | 23,532 | |||||||||||
| Income tax benefit | (14,790 | ) | (6,612 | ) | (42,458 | ) | (16,354 | ) | |||||||
| Net income attributable to Company | 17,779 | 14,359 | 51,039 | 39,886 | |||||||||||
| Less preferred stock dividends | (95 | ) | (95 | ) | (285 | ) | (285 | ) | |||||||
| Less earnings allocated to participating securities | — | (275 | ) | (299 | ) | (764 | ) | ||||||||
| Income available to common shareholders | $ | 17,684 | $ | 13,989 | $ | 50,455 | $ | 38,837 | |||||||
| Earnings per common share – basic | $ | 0.95 | $ | 0.75 | $ | 2.69 | $ | 2.10 | |||||||
| Earnings per common share – diluted | $ | 0.92 | $ | 0.73 | $ | 2.62 | $ | 2.04 | |||||||
| FIRST NBC BANK HOLDING COMPANY | |||||||||||||||
| EARNINGS PER COMMON SHARE | |||||||||||||||
| For the Three Months Ended | For the Nine Months Ended | ||||||||||||||
| September 30, | September 30, | ||||||||||||||
| (In thousands, except per share data) | 2015 | 2014 | 2015 | 2014 | |||||||||||
| Basic: Income available to common shareholders | $ | 17,684 | $ | 13,989 | $ | 50,455 | $ | 38,837 | |||||||
| Weighted-average common shares outstanding | 18,630 | 18,556 | 18,737 | 18,530 | |||||||||||
| Basic earnings per share | $ | 0.95 | $ | 0.75 | $ | 2.69 | $ | 2.10 | |||||||
| Diluted: Income available to common shareholders | $ | 17,684 | $ | 13,989 | $ | 50,455 | $ | 38,837 | |||||||
| Weighted-average common shares outstanding | 18,630 | 18,556 | 18,737 | 18,530 | |||||||||||
| Effect of dilutive securities: | |||||||||||||||
| Stock options outstanding | 420 | 381 | 407 | 382 | |||||||||||
| Restricted stock awards outstanding | 6 | — | 3 | — | |||||||||||
| Warrants | 115 | 117 | 119 | 118 | |||||||||||
| Weighted-average common shares outstanding – assuming dilution | 19,171 | 19,054 | 19,266 | 19,030 | |||||||||||
| Diluted earnings per share | $ | 0.92 | $ | 0.73 | $ | 2.62 | $ | 2.04 | |||||||
| FIRST NBC BANK HOLDING COMPANY | |||||||||||||||||
| SUMMARY FINANCIAL INFORMATION | |||||||||||||||||
| For the Three Months Ended September 30, |
For the Three Months Ended June 30, |
||||||||||||||||
| % Change | % Change | ||||||||||||||||
| (In thousands) | 2015 | 2014 | 2015 | ||||||||||||||
| EARNINGS DATA | |||||||||||||||||
| Total interest income | $ | 42,027 | $ | 38,668 | 8.7 | % | $ | 38,508 | 9.1 | % | |||||||
| Total interest expense | 13,228 | 10,908 | 21.3 | % | 12,402 | 6.7 | % | ||||||||||
| Net interest income | 28,799 | 27,760 | 3.7 | % | 26,106 | 10.3 | % | ||||||||||
| Provision for loan losses | 3,000 | 3,000 | — | % | 5,600 | (46.4 | )% | ||||||||||
| Total noninterest income | 3,148 | 3,034 | 3.8 | % | 3,557 | (11.5 | )% | ||||||||||
| Total noninterest expense | 25,958 | 20,047 | 29.5 | % | 23,099 | 12.4 | % | ||||||||||
| Income before income taxes | 2,989 | 7,747 | (61.4 | )% | 964 | 210.1 | % | ||||||||||
| Income tax (benefit) expense | (14,790 | ) | (6,612 | ) | 123.7 | % | (16,228 | ) | (8.9 | )% | |||||||
| Net income | 17,779 | 14,359 | 23.8 | % | 17,192 | 3.4 | % | ||||||||||
| Preferred stock dividends | (95 | ) | (95 | ) | — | % | (95 | ) | — | % | |||||||
| Earnings allocated to participating securities | — | (275 | ) | (100.0 | )% | (300 | ) | (100.0 | )% | ||||||||
| Net income available to common shareholders | $ | 17,684 | $ | 13,989 | 26.4 | % | $ | 16,797 | 5.3 | % | |||||||
| AVERAGE BALANCE SHEET DATA | |||||||||||||||||
| Total assets | $ | 4,261,539 | $ | 3,593,868 | 18.6 | % | $ | 4,091,331 | 4.2 | % | |||||||
| Total interest-earning assets | 3,755,911 | 3,266,066 | 15.0 | % | 3,656,517 | 2.7 | % | ||||||||||
| Total loans | 3,007,096 | 2,653,083 | 13.3 | % | 2,946,483 | 2.1 | % | ||||||||||
| Total interest-bearing deposits | 3,135,991 | 2,636,924 | 18.9 | % | 2,962,497 | 5.9 | % | ||||||||||
| Total interest-bearing liabilities | 3,347,588 | 2,808,661 | 19.2 | % | 3,184,824 | 5.1 | % | ||||||||||
| Total deposits | 3,532,476 | 2,968,093 | 19.0 | % | 3,372,999 | 4.7 | % | ||||||||||
| Total shareholders’ equity | 477,600 | 414,754 | 15.2 | % | 457,545 | 4.4 | % | ||||||||||
| SELECTED RATIOS(1) | |||||||||||||||||
| Return on average common equity | 16.04 | % | 15.30 | % | 16.59 | % | |||||||||||
| Return on average equity | 14.77 | % | 13.74 | % | 15.07 | % | |||||||||||
| Return on average assets | 1.66 | % | 1.59 | % | 1.69 | % | |||||||||||
| Net interest margin | 3.04 | % | 3.37 | % | 2.86 | % | |||||||||||
| Efficiency ratio(2) | 81.25 | % | 65.10 | % | 77.87 | % | |||||||||||
| Tier 1 leverage ratio | 9.50 | % | 11.31 | % | 9.80 | % | |||||||||||
| Tier 1 risk-based capital ratio | 10.44 | % | 12.37 | % | 10.79 | % | |||||||||||
| Total risk-based capital ratio | 13.30 | % | 13.62 | % | 13.72 | % | |||||||||||
| Common equity Tier 1 capital ratio | 10.44 | % | NA | 10.79 | % | ||||||||||||
| ASSET QUALITY RATIOS(1) | |||||||||||||||||
| Nonperforming loans to total loans(3)(5) | 1.25 | % | 0.90 | % | 1.25 | % | |||||||||||
| Nonperforming assets to total assets(4) | 1.01 | % | 0.82 | % | 1.00 | % | |||||||||||
| Allowance for loan losses to total loans(5) | 1.70 | % | 1.49 | % | 1.72 | % | |||||||||||
| Allowance for loan losses to nonperforming loans(3) | 136.13 | % | 165.47 | % | 137.40 | % | |||||||||||
| Net charge-offs to average loans | 0.03 | % | 0.03 | % | 0.02 | % | |||||||||||
(1) With the exception of end-of-period ratios, all ratios are based on average monthly balances during the respective periods.
(2) Efficiency ratio is the ratio of noninterest expense to net interest income and noninterest income. See the Company’s Non-GAAP efficiency ratio calculation which excludes the impact of the noninterest income and expense related to its tax credit investments.
(3) Nonperforming loans consist of nonaccrual loans and restructured loans.
(4) Nonperforming assets consist of nonperforming loans and real estate and other property that has been repossessed.
(5) Total loans are net of unearned discounts and deferred fees and costs.
| FIRST NBC BANK HOLDING COMPANY | |||||||||||
| RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||
| IMPACT OF INVESTMENT IN FEDERAL TAX CREDIT PROGRAMS | |||||||||||
| For the Three Months Ended | |||||||||||
| September 30, | June 30, | September 30, | |||||||||
| (In thousands) | 2015 | 2015 | 2014 | ||||||||
| Income before income taxes: | |||||||||||
| Income before income taxes (GAAP) | $ | 2,989 | $ | 964 | $ | 7,747 | |||||
| Income adjustment before income taxes related to the impact of tax credit related activities (Non-GAAP) | |||||||||||
| Tax equivalent income associated with investment in federal tax credit programs(1) | 24,340 | 25,397 | 14,057 | ||||||||
| Income before income taxes (Non-GAAP) | 27,329 | 26,361 | 21,804 | ||||||||
| Income tax expense-adjusted (Non-GAAP)(2) | (9,550 | ) | (9,169 | ) | (7,445 | ) | |||||
| Net income (GAAP) | $ | 17,779 | $ | 17,192 | $ | 14,359 | |||||
| Pro forma income related to investment in tax credit entities: | |||||||||||
| Income before income taxes (GAAP) | $ | 2,989 | $ | 964 | $ | 7,747 | |||||
| Pro forma interest income adjustment | |||||||||||
| Pro forma interest income related to investment in tax credit entities(3) | 2,184 | 2,051 | 1,544 | ||||||||
| Noninterest expense adjustment(4) | |||||||||||
| Impairment of investment in tax credit entities(5) | 6,160 | 2,647 | 3,974 | ||||||||
| Other direct expenses(6) | 727 | 639 | 557 | ||||||||
| Pro forma income before income taxes (Non-GAAP) | 12,060 | 6,301 | 13,822 | ||||||||
| Income tax expense-adjusted (Non-GAAP)(2) | (4,215 | ) | (2,191 | ) | (4,720 | ) | |||||
| Pro forma net income (Non-GAAP) | $ | 7,845 | $ | 4,110 | $ | 9,102 | |||||
| Adjusted Efficiency Ratio: | |||||||||||
| Noninterest expense (GAAP) | $ | 25,958 | $ | 23,099 | $ | 20,047 | |||||
| Adjustments: | |||||||||||
| Impairment of investment in tax credit entities(5) | 6,160 | 2,647 | 3,974 | ||||||||
| Other direct expenses(6) | 727 | 639 | 557 | ||||||||
| Adjusted noninterest expense (Non-GAAP) | 19,071 | 19,813 | 15,516 | ||||||||
| Net interest income (GAAP) | 28,799 | 26,106 | 27,760 | ||||||||
| Noninterest income (GAAP) | 3,148 | 3,557 | 3,034 | ||||||||
| Adjustments: | |||||||||||
| State tax credits earned | 495 | 668 | 597 | ||||||||
| Community Development Entity fees earned | 183 | 133 | 109 | ||||||||
| Adjusted noninterest income (Non-GAAP) | 2,470 | 2,756 | 2,328 | ||||||||
| Adjusted total revenue (Non-GAAP) | $ | 31,269 | $ | 28,862 | $ | 30,088 | |||||
| Adjusted efficiency ratio (Non-GAAP) | 60.99 | % | 68.65 | % | 51.57 | % | |||||
(1) Tax equivalent income associated with investment in federal tax credit programs represents the gross amount of tax benefit from federal tax credits.
(2) Income tax expense is calculated on the adjusted non-GAAP effective tax rate for the Company at each quarter end period ended September 30, 2015, June 30, 2015, and September 30, 2014, respectively.
(3) Pro forma interest income adjustment related to investment in tax credit entities is calculated based on the average investment in tax credit entities utilizing the average yield on loans had the investment in tax credit entities been invested in loans.
(4) Noninterest expense adjustments related to the Company’s investment in federal tax credit programs are included as adjustments to income as if the Company had invested in loans instead of federal tax credit programs. These expenses are directly related to the Company’s investment in federal tax credit programs. Noninterest expense adjustments for direct expenses related to the Company’s investment in federal tax credit programs exclude general and administrative costs associated with the Company’s investment in federal tax credit programs.
(5) Impairment of investment in tax credit entities represents impairment recorded during the current period, as evaluated by the Company at the end of each reporting period.
(6) Other direct expenses represent fees and expenses incurred as a result of the Company’s investment in federal tax credit programs.
CONTACT: For further information contact: First NBC Bank Holding Company Ashton J. Ryan, Jr. President and Chief Executive Officer (504) 671-3801 [email protected]