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First Financial Corporation Reports First Quarter Results
المصدر: Nasdaq GlobeNewswire / 27 أبريل 2021 10:00:00 America/New_York
TERRE HAUTE, Ind., April 27, 2021 (GLOBE NEWSWIRE) -- First Financial Corporation (NASDAQ:THFF) today announced results for the three months ending March 31, 2021:
For the quarter:
- Net income was $12.9 million compared to $12.2 million for the same period of 2020;
- Diluted net income per common share of $0.95 compared to $0.89 for the same period of 2020; and
- Return on average assets was 1.12% compared to 1.21% for the three months ended March 31, 2020.
“Despite the continued headwinds of the global pandemic and the varied restrictions of the four states in which we do business, we were able to deliver solid performance in the first quarter,” said Norman L. Lowery, Chairman and Chief Executive Officer. “During the first quarter we reopened our branch office lobbies and we were able to assist many of our clients to participate in the second round of the Paycheck Protection Program.”
Average Total Loans
Average total loans for the first quarter of 2021 were $2.64 billion versus $2.64 billion for the comparable period in 2020.Total Loans Outstanding
Total loans outstanding increased $24.3 million, from $2.62 billion as of March 31, 2020 to $2.65 billion as of March 31, 2021.Average Total Deposits
Average total deposits for the quarter ended March 31, 2021, were $3.82 billion versus $3.27 billion as of March 31, 2020, an increase of $546 million or 16.70%.Total Deposits
Total deposits were $3.91 billion as of March 31, 2021, compared to $3.29 billion as of March 31, 2020, an increase of $614 million or 18.66%. On a linked quarter basis, total deposits increased $149.4 million from $3.76 billion for the quarter ending December 31, 2020.Book Value Per Share
Book Value per share was $44.20 at March 31, 2021, compared to $42.42 at March 31, 2020, a 4.21% increase.Shareholder Equity
Shareholder equity at March 31, 2021, was $598.1 million compared to $581.8 million on March 31, 2020. During the quarter the Corporation repurchased 26,300 shares of its common stock.Tangible Common Equity to Tangible Asset Ratio
The Corporation’s tangible common equity to tangible asset ratio was 11.12% at March 31, 2021, compared to 12.41% at March 31, 2020.Net Interest Income
Net interest income for the first quarter of 2021 was $34.9 million, compared to $36.4 million reported for the same period of 2020. The decrease was primarily driven by the 150 basis point interest rate reduction by the Federal Reserve in response to the COVID-19 pandemic.Net Interest Margin
The net interest margin for the quarter ended March 31, 2021, was 3.27% compared to the 4.13% reported at March 31, 2020.Nonperforming Loans
Nonperforming loans as of March 31, 2021, were $21.0 million versus $17.6 million as of March 31, 2020. The ratio of nonperforming loans to total loans and leases was 0.79% as of March 31, 2021, versus 0.67% as of March 31, 2020.Credit Loss Provision
In the first three quarters of 2020 the provision was calculated using the incurred loss basis. Beginning in the fourth quarter 2020, the provision was calculated using the current expected credit loss accounting standard. The provision for credit losses for the three months ended March 31 2021, was $452 thousand compared to the $2.69 million provision for the first quarter of 2020.Net Charge-Offs
Net charge-offs were $728 thousand for the first quarter of 2021 compared to $1.57 million in the same period of 2020.Allowance for Credit Losses
In March 2020 due to the uncertainty surrounding the global pandemic and as provided by the Coronavirus Aid Relief and Economic Security Act the Corporation elected to delay the implementation of the Current Expected Credit Loss accounting standard. On December 31, 2020 the Corporation adopted ASU 2016-13 (topic 326), “Measurement of Credit Losses on Financial Instruments” commonly referenced as the Current Expected Credit Loss (“CECL”) model. CECL was retrospectively adopted on January 1, 2020.The Corporation’s allowance for credit losses as of March 31, 2021, was $46.8 million compared to $21.1 million as of March 31, 2020. The increase is primarily related to the adoption of CECL. The allowance for credit losses as a percent of total loans was 1.77% as of March 31, 2021, compared to 0.80% as of March 31, 2020. The allowance as of March 31, 2021 was calculated using CECL. The allowance as of March 31, 2020 was calculated using the incurred loss method.
Non-Interest Income
Non-interest income for the three months ended March 31, 2021 and 2020 was $9.3 and $9.1 million, respectively.Non-Interest Expense
Non-interest expense for the three months ended March 31, 2021, was $27.6 million compared to $27.6 million in 2020.Efficiency Ratio
The Corporation’s efficiency ratio was 61.08% for the quarter ending March 31, 2021, versus 59.25% for the same period in 2020.Income Taxes
Income tax expense for the three months ended March 31, 2021, was $3.2 million versus $3.0 million for the same period in 2020. The effective tax rate for the first quarter of 2021 was 20.10% compared to 19.87% for same period of 2020.“First Financial continues to meet the financial needs of our customers,” Lowery stated. “I am very proud of our associates' and of their unwavering commitment to serve our customers in these challenging times.”
About First Financial Corporation
First Financial Corporation (NASDAQ:THFF) is the holding company for First Financial Bank N.A. and The Morris Plan Company of Terre Haute, Inc. First Financial Bank N.A. is the fifth oldest national bank in the United States, operating 80 banking centers in Illinois, Indiana, Kentucky and Tennessee. The Morris Plan Company of Terre Haute, Inc. is a state industrial chartered financial institution operating one office in Terre Haute, Indiana. Additional information is available at www.first-online.bank.Investor Contact:
Rodger A. McHargue
Chief Financial Officer
P: 812-238-6334
E: rmchargue@first-online.comThree Months Ended March 31, December 31, March 31, 2021 2020 2020 END OF PERIOD BALANCES Assets $ 4,681,216 $ 4,557,544 $ 4,062,414 Deposits $ 3,905,348 $ 3,755,945 $ 3,291,231 Loans, including net deferred loan costs $ 2,646,937 $ 2,610,294 $ 2,622,637 Allowance for Credit Losses $ 46,776 $ 47,052 $ 21,063 Total Equity $ 598,112 $ 596,992 $ 581,771 Tangible Common Equity (a) $ 510,981 $ 509,428 $ 492,943 AVERAGE BALANCES Total Assets $ 4,600,750 $ 4,532,078 $ 4,022,789 Earning Assets $ 4,404,109 $ 3,736,217 $ 3,625,679 Investments $ 1,133,439 $ 1,058,925 $ 988,523 Loans $ 2,640,291 $ 2,676,041 $ 2,637,036 Total Deposits $ 3,816,705 $ 3,741,155 $ 3,270,627 Interest-Bearing Deposits $ 3,059,290 $ 3,005,337 $ 2,739,394 Interest-Bearing Liabilities $ 110,448 $ 98,922 $ 106,843 Total Equity $ 600,669 $ 610,879 $ 569,696 INCOME STATEMENT DATA Net Interest Income $ 34,913 $ 37,570 $ 36,350 Net Interest Income Fully Tax Equivalent (b) $ 35,959 $ 38,606 $ 37,409 Provision for Credit Losses $ 452 $ 448 $ 2,690 Non-interest Income $ 9,294 $ 12,866 $ 9,095 Non-interest Expense $ 27,639 $ 31,191 $ 27,554 Net Income $ 12,877 $ 15,739 $ 12,181 PER SHARE DATA Basic and Diluted Net Income Per Common Share $ 0.95 $ 1.15 $ 0.89 Cash Dividends Declared Per Common Share $ — $ 0.53 $ — Book Value Per Common Share $ 44.20 $ 44.03 $ 42.42 Tangible Book Value Per Common Share (c) $ 37.76 $ 37.64 $ 35.94 Basic Weighted Average Common Shares Outstanding 13,533 13,695 13,740 (a) Tangible common equity is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible common equity by excluding goodwill and other intangible assets from shareholder's equity.
(b) Net interest income fully tax equivalent is a non-GAAP financial measure derived from GAAP-based amounts. We calculate net interest income fully tax equivalent by adding back the tax equivalent factor of tax exempt income to net interest income. We calculate the tax equivalent factor of tax exempt income by dividing tax exempt income by the net of tax rate of 75%.
(c) Tangible book value per common share is a non-GAAP financial measure derived from GAAP-based amounts. We calculate the factor by dividing average tangible common equity by average shares outstanding. We calculate average tangible common equity by excluding average intangible assets from average shareholder's equity.Key Ratios Three Months Ended March 31, December 31, March 31, 2021 2020 2020 Return on average assets 1.12 % 1.39 % 1.21 % Return on average common shareholder's equity 8.58 % 10.31 % 8.55 % Efficiency ratio 61.08 % 60.60 % 59.25 % Average equity to average assets 13.06 % 13.48 % 14.16 % Net interest margin (a) 3.27 % 4.11 % 4.13 % Net charge-offs to average loans and leases 0.11 % 0.05 % 0.24 % Credit loss reserve to loans and leases 1.77 % 1.80 % 0.80 % Credit loss reserve to nonperforming loans 222.64 % 214.88 % 119.70 % Nonperforming loans to loans and leases 0.79 % 0.84 % 0.67 % Tier 1 leverage 11.34 % 11.24 % 12.38 % Risk-based capital - Tier 1 16.17 % 16.11 % 16.19 % (a) Net interest margin is calculated on a tax equivalent basis.
Asset Quality Three Months Ended March 31, December 31, March 31, 2021 2020 2020 Accruing loans and leases past due 30-89 days $ 8,373 $ 17,309 $ 27,037 Accruing loans and leases past due 90 days or more $ 2,001 $ 2,324 $ 1,430 Nonaccrual loans and leases $ 14,545 $ 15,367 $ 12,011 Total troubled debt restructuring $ 4,464 $ 4,206 $ 4,156 Other real estate owned $ 942 $ 1,012 $ 3,894 Nonperforming loans and other real estate owned $ 21,952 $ 22,909 $ 21,491 Total nonperforming assets $ 25,280 $ 26,045 $ 24,724 Gross charge-offs $ 2,338 $ 1,954 $ 2,904 Recoveries $ 1,610 $ 1,538 $ 1,334 Net charge-offs/(recoveries) $ 728 $ 416 $ 1,570 CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands, except per share data)March 31,
2021December 31,
2020(unaudited) ASSETS Cash and due from banks $ 666,846 $ 657,470 Federal funds sold 585 301 Securities available-for-sale 1,097,093 1,020,744 Loans: Commercial 1,571,142 1,521,711 Residential 592,053 604,652 Consumer 477,633 479,750 2,640,828 2,606,113 (Less) plus: Net deferred loan costs 6,109 4,181 Allowance for credit losses (46,776 ) (47,052 ) 2,600,161 2,563,242 Restricted stock 14,825 14,812 Accrued interest receivable 15,465 16,957 Premises and equipment, net 62,584 62,063 Bank-owned life insurance 96,184 95,849 Goodwill 78,592 78,592 Other intangible assets 8,539 8,972 Other real estate owned 942 1,012 Other assets 39,400 37,530 TOTAL ASSETS $ 4,681,216 $ 4,557,544 LIABILITIES AND SHAREHOLDERS’ EQUITY Deposits: Non-interest-bearing $ 805,645 $ 732,694 Interest-bearing: Certificates of deposit exceeding the FDIC insurance limits 118,162 107,764 Other interest-bearing deposits 2,981,541 2,915,487 3,905,348 3,755,945 Short-term borrowings 98,775 116,061 FHLB advances 5,874 5,859 Other liabilities 73,107 82,687 TOTAL LIABILITIES 4,083,104 3,960,552 Shareholders’ equity Common stock, $.125 stated value per share; Authorized shares-40,000,000 Issued shares-16,075,154 in 2021 and 16,075,154 in 2020 Outstanding shares-13,530,570 in 2021 and 13,558,511 in 2020 2,008 2,007 Additional paid-in capital 141,024 140,820 Retained earnings 533,980 521,103 Accumulated other comprehensive income/(loss) (832 ) 9,764 Less: Treasury shares at cost-2,551,084 in 2021 and 2,516,643 in 2020 (78,068 ) (76,702 ) TOTAL SHAREHOLDERS’ EQUITY 598,112 596,992 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 4,681,216 $ 4,557,544 CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(Dollar amounts in thousands, except per share data)Three Months Ended March 31, 2021 2020 (unaudited) INTEREST INCOME: Loans, including related fees $ 31,857 $ 35,034 Securities: Taxable 3,079 4,029 Tax-exempt 2,074 1,938 Other 346 402 TOTAL INTEREST INCOME 37,356 41,403 INTEREST EXPENSE: Deposits 2,286 4,530 Short-term borrowings 98 267 Other borrowings 59 256 TOTAL INTEREST EXPENSE 2,443 5,053 NET INTEREST INCOME 34,913 36,350 Provision for credit losses 452 2,690 NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 34,461 33,660 NON-INTEREST INCOME: Trust and financial services 1,305 1,534 Service charges and fees on deposit accounts 2,243 2,998 Other service charges and fees 4,242 3,330 Securities gains (losses), net (152 ) 194 Gain on sales of mortgage loans 1,393 698 Other 263 341 TOTAL NON-INTEREST INCOME 9,294 9,095 NON-INTEREST EXPENSE: Salaries and employee benefits 15,677 15,972 Occupancy expense 2,149 1,929 Equipment expense 2,578 2,461 FDIC Expense 298 (230 ) Other 6,937 7,422 TOTAL NON-INTEREST EXPENSE 27,639 27,554 INCOME BEFORE INCOME TAXES 16,116 15,201 Provision for income taxes 3,239 3,020 NET INCOME 12,877 12,181 OTHER COMPREHENSIVE INCOME Change in unrealized gains/(losses) on securities, net of reclassifications and taxes (11,068 ) 13,098 Change in funded status of post retirement benefits, net of taxes 472 404 COMPREHENSIVE INCOME $ 2,281 $ 25,683 PER SHARE DATA Basic and Diluted Earnings per Share $ 0.95 $ 0.89 Weighted average number of shares outstanding (in thousands) 13,533 13,740 