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CST: 14/12/2019 23:13:16   

Independent Bank Corporation Reports 2019 Second Quarter Results

142 Days ago

GRAND RAPIDS, Mich., July 25, 2019 (GLOBE NEWSWIRE) -- Independent Bank Corporation (NASDAQ: IBCP) reported second quarter 2019 net income of $10.7 million, or $0.46 per diluted share, versus net income of $8.8 million, or $0.36 per diluted share, in the prior-year period.  For the six months ended June 30, 2019, the Company reported net income of $20.1 million, or $0.85 per diluted share, compared to net income of $18.0 million, or $0.78 per diluted share, in the prior-year period.  The increases in second quarter and year to date 2019 earnings as compared to 2018 primarily reflect an increase in net interest income.

Significant items impacting comparable quarterly and year to date 2019 and 2018 results include the following:

  • Changes in the fair value due to price of capitalized mortgage loan servicing rights (the “MSR Changes”) of a negative $2.7 million ($0.09 per diluted share, after taxes) and a negative $4.9 million ($0.16 per diluted share, after taxes) for the three- and six-months ended June 30, 2019, respectively, as compared to positive MSR Changes of $0.5 million ($0.02 per diluted share, after taxes) and $2.0 million ($0.07 per diluted share, after taxes) for the three- and six-months ended June 30, 2018, respectively.
  • The acquisition of TCSB Bancorp, Inc. (“TCSB”), and its subsidiary, Traverse City State Bank, on Apr. 1, 2018 (referred to as the “Merger” or “TCSB Acquisition”) and the associated data processing systems conversions in June 2018.  The total assets, loans and deposits acquired in the Merger were approximately $342.8 million, $295.8 million (including $1.3 million of loans held for sale) and $287.7 million, respectively.
  • Merger related expenses of $3.1 million ($0.10 per diluted share, after taxes) and $3.3 million ($0.11 per diluted share, after taxes) for the three- and six-months ended June 30, 2018, respectively.

Second quarter 2019 highlights include:

  • Return on average assets and return on average equity of 1.27% and 12.72%, respectively (these ratios increase to 1.52% and 15.22%, respectively, when excluding the after tax impact of the MSR Change);
  • A year-over-year increase in quarterly net interest income of $1.8 million, or 6.1%;
  • Total portfolio loan net growth of $87.7 million, or 13.4% annualized;
  • Continued strong asset quality metrics; and
  • The payment of an 18 cent per share dividend on common stock on May 15, 2019.

William B. (“Brad”) Kessel, the President and Chief Executive Officer of Independent Bank Corporation, commented: “We are pleased to report another quarter of solid financial performance.  Excluding the after-tax impacts of the MSR Changes and the Merger related expenses, net income and diluted earnings per share increased by 18.4% and 25.0%, respectively, in the second quarter of 2019 as compared to the second quarter of 2018.  As we look ahead to the last half of 2019 and beyond, we are focused on building on the momentum generated in the first half of the year.”

Operating Results

The Company’s net interest income totaled $30.8 million during the second quarter of 2019, an increase of $1.8 million, or 6.1% from the year-ago period, and up $0.5 million, or 1.7%, from the first quarter of 2019.  The Company’s tax equivalent net interest income as a percent of average interest-earning assets (the “net interest margin”) was 3.87% during the second quarter of 2019, compared to 3.93% in the year-ago period, and 3.88% in the first quarter of 2019.  The year-over-year quarterly increase in net interest income is due to an increase in average interest-earning assets that was partially offset by a decline in the net interest margin.  Average interest-earning assets were $3.19 billion in the second quarter of 2019, compared to $2.96 billion in the year ago quarter and $3.15 billion in the first quarter of 2019.  Second quarter 2019 and 2018 interest income on loans includes $0.4 million and $0.6 million, respectively, of accretion of the discount recorded on the TCSB loans acquired in the Merger. 

For the first six months of 2019, net interest income totaled $61.0 million, an increase of $8.1 million, or 15.3% from the first half of 2018.  The Company’s net interest margin for the first six months of 2019 was 3.88% compared to 3.83% in 2018.  The increase in net interest income for the first six months of 2019 is due to increases in both average interest-earning assets and in the net interest margin.

Non-interest income totaled $9.9 million and $19.9 million, respectively, for the second quarter and first six months of 2019, compared to $12.3 million and $24.0 million in the respective comparable year ago periods.  These changes were primarily due to variances in mortgage banking related revenues (net gains on mortgage loans and mortgage loan servicing, net).
                                                                                                                                
Net gains on mortgage loans in the second quarters of 2019 and 2018, were approximately $4.3 million and $3.3 million, respectively.  For the first six months of 2019, net gains on mortgage loans totaled $7.9 million compared to $5.8 million in 2018.  The increase in net gains on mortgage loans was primarily due to an increase in mortgage loan sales volume in 2019 as well as fair value adjustments on the mortgage loan pipeline.

Mortgage loan servicing, net, generated a loss of $1.9 million and income of $1.2 million in the second quarters of 2019 and 2018, respectively. For the first six months of 2019, mortgage loan servicing, net, generated a loss of $3.1 million as compared to income of $3.5 million in 2018.  The significant variances in mortgage loan servicing, net are primarily due to changes in the fair value of capitalized mortgage loan servicing rights associated with changes in mortgage loan interest rates (a decline in 2019 as compared to an increase in 2018) and expected future prepayment levels. Mortgage loan servicing, net activity is summarized in the following table:

  Three Months Ended Six Months Ended
  6/30/2019 6/30/2018 6/30/2019 6/30/2018
Mortgage loan servicing, net: (Dollars in thousands)
Revenue, net $ 1,515   $ 1,372   $ 2,991   $ 2,564  
Fair value change due to price   (2,670 )   518     (4,873 )   1,976  
Fair value change due to pay-downs   (752 )   (655 )   (1,240 )   (1,084 )
Total $ (1,907 ) $ 1,235   $ (3,122 ) $ 3,456  

Non-interest expenses totaled $26.6 million in the second quarter of 2019, compared to $29.8 million in the year-ago period.  For the first six months of 2019, non-interest expenses totaled $54.6 million versus $53.9 million in 2018.  These year-over-year changes in non-interest expense are primarily due to the TCSB Acquisition (including the aforementioned Merger related expenses) as well as higher compensation and health insurance costs. 

The Company recorded an income tax expense of $2.7 million and $4.9 million in the second quarter and first six months of 2019, respectively.  This compares to an income tax expense of $2.1 million and $4.1 million in the second quarter and first six months of 2018, respectively.  The increase in income tax expense is primarily due to higher pre-tax earnings in 2019.

Asset Quality

Commenting on asset quality, President and CEO Kessel added:  “Non-performing loans and assets as well as loan net charge-offs remain at low levels.  In addition, thirty- to eighty-nine day delinquency rates at June 30, 2019 were 0.02% for commercial loans and 0.43% for mortgage and consumer loans.  These early stage delinquency rates continue to be well-managed.”

A breakdown of non-performing loans(1) by loan type is as follows:

Loan Type 6/30/2019 12/31/2018 6/30/2018
  (Dollars in thousands)
Commercial $ 900   $ 2,220   $ 2,889  
Consumer/installment   901     781     671  
Mortgage   5,997     6,033     5,522  
Total non-accrual loans   7,798     9,034     9,082  
Less – government guaranteed loans   436     460     224  
Total non-performing loans $ 7,362   $ 8,574   $ 8,858  
Ratio of non-performing loans to total portfolio loans   0.27 %   0.33 %   0.36 %
Ratio of non-performing assets to total assets   0.27 %   0.29 %   0.33 %
Ratio of the allowance for loan losses to non-performing loans   351.85 %   290.27 %   265.34 %
 
(1)   Excludes loans that are classified as “troubled debt restructured” that are still performing.

Non-performing loans have decreased $1.2 million from Dec. 31, 2018.  This decrease principally reflects a decline in non-performing commercial loans due primarily to pay-downs, charge-offs and a transfer to other real estate.  Other real estate and repossessed assets totaled $2.0 million at June 30, 2019, compared to $1.3 million at Dec. 31, 2018.  This increase is primarily due to the addition of a $0.6 million commercial office building located in Grand Rapids during the second quarter of 2019. 

The provision for loan losses was an expense of $0.7 million in both the second quarters of 2019 and 2018, respectively.  The provision for loan losses was an expense of $1.3 million and $1.0 million in the first six months of 2019 and 2018, respectively. The level of the provision for loan losses in each period reflects the Company’s overall assessment of the allowance for loan losses, taking into consideration factors such as loan growth, loan mix, levels of non-performing and classified loans and loan net charge-offs.  The Company recorded loan net charge-offs of $0.003 million and $0.217 million in the second quarters of 2019 and 2018, respectively.  For the first six months of 2019 and 2018, the Company recorded loan net charge-offs of $0.301 million and $0.048 million, respectively.  At June 30, 2019, the allowance for loan losses totaled $25.9 million, or 0.96% of total portfolio loans, compared to $24.9 million, or 0.96% of total portfolio loans, at Dec. 31, 2018. Excluding the remaining TCSB acquired loan balances, the allowance for loan losses was equal to 1.03% and 1.06% of portfolio loans at June 30, 2019 and Dec. 31, 2018, respectively.

Balance Sheet, Liquidity and Capital

Total assets were $3.44 billion at June 30, 2019, an increase of $85.0 million from Dec. 31, 2018.  Loans, excluding loans held for sale, were $2.71 billion at June 30, 2019, compared to $2.58 billion at Dec. 31, 2018.  Deposits totaled $2.98 billion at June 30, 2019, an increase of $65.5 million from Dec. 31, 2018.  The increase in total deposits is primarily due to growth in reciprocal deposits. 

Cash and cash equivalents totaled $55.1 million at June 30, 2019, versus $70.2 million at Dec. 31, 2018. Securities available for sale totaled $430.3 million at June 30, 2019, versus $427.9 million at Dec. 31, 2018. 

Total shareholders’ equity was $330.8 million at June 30, 2019, or 9.62% of total assets.  Tangible common equity totaled $296.7 million at June 30, 2019, or $13.19 per share.  The Company’s wholly owned subsidiary, Independent Bank, remains significantly above “well capitalized” for regulatory purposes with the following ratios:

Regulatory Capital Ratios 6/30/2019 12/31/2018 Well Capitalized
Minimum

       
Tier 1 capital to average total assets 9.50% 9.44% 5.00%
Tier 1 common equity  to risk-weighted assets 11.80% 11.94% 6.50%
Tier 1 capital to risk-weighted assets 11.80% 11.94% 8.00%
Total capital to risk-weighted assets 12.81% 12.94% 10.00%

Share Repurchase Plan

As previously announced, on Dec. 18, 2018, the Board of Directors of the Company authorized a 2019 share repurchase plan.  Under the terms of the original 2019 share repurchase plan, the Company was authorized to buy back up to 5% of its outstanding common stock.  During the first six months of 2019, the Company completed the repurchase of 5% of its outstanding common shares (1,179,688 shares at a weighted average purchase price of $21.85 per share). On June 18, 2019, the Board of Directors of the Company supplemented the 2019 share repurchase plan and authorized the repurchase of up to 300,000 additional common shares. The 2019 share repurchase plan is authorized to last through Dec. 31, 2019.

Earnings Conference Call

Brad Kessel, President and CEO, and Rob Shuster, CFO, will review the quarterly results in a conference call for investors and analysts beginning at 11:00 am ET on Thursday, July 25, 2019.

To participate in the live conference call, please dial 1-866-200-8394. Also the conference call will be accessible through an audio webcast with user-controlled slides via the following URL:  https://services.choruscall.com/links/ibcp190725.html.

A playback of the call can be accessed by dialing 1-877-344-7529 (Conference ID # 10132049). The replay will be available through Aug. 1, 2019.

About Independent Bank Corporation

Independent Bank Corporation (NASDAQ: IBCP) is a Michigan-based bank holding company with total assets of approximately $3.4 billion.  Founded as First National Bank of Ionia in 1864, Independent Bank Corporation operates a branch network across Michigan's Lower Peninsula through one state-chartered bank subsidiary. This subsidiary (Independent Bank) provides a full range of financial services, including commercial banking, mortgage lending, investments and insurance. Independent Bank Corporation is committed to providing exceptional personal service and value to its customers, stockholders and the communities it serves. 

For more information, please visit our Web site at:  IndependentBank.com.

Forward-Looking Statements

This release may contain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Any statements that are not historical facts, including statements about our expectations, beliefs, plans, strategies, predictions, forecasts, objectives, or assumptions of future events or performance, may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipates,” “believes,” “expects,” “can,” “could,” “may,” “predicts,” “potential,” “opportunity,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “seeks,” “intends” and similar words or phrases. Accordingly, these statements involve estimates, known and unknown risks, assumptions, and uncertainties that could cause actual strategies, actions, or results to differ materially from those expressed in them, and are not guarantees  of timing, future results, events, or performance. Because forward-looking statements are necessarily only estimates of future strategies, actions, or results, based on management’s current expectations, assumptions, and estimates on the date hereof, there can be no assurance that actual strategies, actions or results will not differ materially from expectations. Therefore, readers are cautioned not to place undue reliance on such statements.  Factors that could cause or contribute to such differences are changes in general economic, political or industry conditions; changes in monetary and fiscal policies, including the interest rate policies of the Federal Reserve Board; volatility and disruptions in capital and credit markets; the interdependence of financial service companies; changes in regulation or oversight; unfavorable developments concerning credit quality; any future acquisitions or divestitures; the effects of more stringent capital or liquidity requirements; declines or other changes in the businesses or industries of Independent Bank Corporation's customers; the implementation of Independent Bank Corporation's strategies and business models; Independent Bank Corporation's ability to utilize technology to efficiently and effectively develop, market and deliver new products and services; operational difficulties, failure of technology infrastructure or information security incidents; changes in the financial markets, including fluctuations in interest rates and their impact on deposit pricing; competitive product and pricing pressures among financial institutions within Independent Bank Corporation's markets; changes in customer behavior; management's ability to maintain and expand customer relationships; management's ability to retain key officers and employees; the impact of legal and regulatory proceedings or determinations; the effectiveness of methods of reducing risk exposures; the effects of terrorist activities and other hostilities; the effects of catastrophic events; changes in accounting standards and the critical nature of Independent Bank Corporation's accounting policies.

Certain risks and important factors that could affect Independent Bank Corporation's future results are identified in its Annual Report on Form 10-K for the year ended December 31, 2018 and other reports filed with the SEC, including among other things under the heading “Risk Factors” in such Annual Report on Form 10-K. Any forward-looking statement speaks only as of the date on which it is made, and Independent Bank Corporation undertakes no obligation to update any forward-looking statement, whether to reflect events or circumstances, after the date on which the statement is made, to reflect new information or the occurrence of unanticipated events, or otherwise.

Contact:  William B. Kessel, President and CEO, 616.447.3933
  Robert N. Shuster, Chief Financial Officer, 616.522.1765
   
   


INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Financial Condition
    June 30,   December 31,
      2019       2018  
                 
    (unaudited)
    (In thousands, except share
    amounts)
Assets                
Cash and due from banks   $ 34,461     $ 23,350  
Interest bearing deposits     20,676       46,894  
Cash and Cash Equivalents     55,137       70,244  
Interest bearing deposits - time     498       595  
Equity securities at fair value     -       393  
Securities available for sale     430,305       427,926  
Federal Home Loan Bank and Federal Reserve Bank stock, at cost     18,359       18,359  
Loans held for sale, carried at fair value     62,883       44,753  
Loans held for sale, carried at lower of cost or fair value     -       41,471  
Loans        
Commercial     1,175,970       1,144,481  
Mortgage     1,086,309       1,042,890  
Installment     444,247       395,149  
Total Loans     2,706,526       2,582,520  
Allowance for loan losses     (25,903 )     (24,888 )
Net Loans     2,680,623       2,557,632  
Other real estate and repossessed assets     1,990       1,299  
Property and equipment, net     37,703       38,777  
Bank-owned life insurance     55,580       55,068  
Deferred tax assets, net     2,746       5,779  
Capitalized mortgage loan servicing rights     17,894       21,400  
Other intangibles     5,870       6,415  
Goodwill     28,300       28,300  
Accrued income and other assets     40,414       34,870  
Total Assets   $ 3,438,302     $ 3,353,281  
         
Liabilities and Shareholders' Equity
Deposits        
Non-interest bearing   $ 864,481     $ 879,549  
Savings and interest-bearing checking     1,158,910       1,194,865  
Reciprocal     326,326       182,072  
Time     384,477       385,981  
Brokered time     244,691       270,961  
Total Deposits     2,978,885       2,913,428  
Other borrowings     41,144       25,700  
Subordinated debentures     39,422       39,388  
Accrued expenses and other liabilities     48,005       35,771  
Total Liabilities     3,107,456       3,014,287  
         
Shareholders’ Equity        
Preferred stock, no par value, 200,000 shares authorized; none issued or outstanding     -       -  
Common stock, no par value, 500,000,000 shares authorized; issued and outstanding:        
22,498,776 shares at June 30, 2019 and 23,579,725 shares at December 31, 2018     351,894       377,372  
Accumulated deficit     (16,617 )     (28,270 )
Accumulated other comprehensive loss     (4,431 )     (10,108 )
Total Shareholders’ Equity     330,846       338,994  
Total Liabilities and Shareholders’ Equity   $ 3,438,302     $ 3,353,281  
         
         

 

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
                     
    Three Months Ended   Six Months Ended
    June 30,   March 31,   June 30,   June 30,
      2019       2019       2018       2019       2018  
                                         
    (unaudited)
Interest Income   (In thousands, except per share amounts)
Interest and fees on loans   $ 33,836     $ 32,681     $ 29,674     $ 66,517     $ 53,027  
Interest on securities                                        
Taxable     3,034       3,006       2,720       6,040       5,355  
Tax-exempt     324       374       444       698       923  
Other investments     379       575       265       954       595  
Total Interest Income     37,573       36,636       33,103       74,209       59,900  
Interest Expense                                        
Deposits     6,021       5,681       3,209       11,702       5,496  
Other borrowings and subordinated debentures     796       712       914       1,508       1,488  
Total Interest Expense     6,817       6,393       4,123       13,210       6,984  
Net Interest Income     30,756       30,243       28,980       60,999       52,916  
Provision for loan losses     652       664       650       1,316       965  
Net Interest Income After Provision for Loan Losses     30,104       29,579       28,330       59,683       51,951  
Non-interest Income                                        
Service charges on deposit accounts     2,800       2,640       3,095       5,440       6,000  
Interchange income     2,604       2,355       2,504       4,959       4,750  
Net gains (losses) on assets                                        
Mortgage loans     4,302       3,611       3,255       7,913       5,826  
Securities     -       304       9       304       (164 )
Mortgage loan servicing, net     (1,907 )     (1,215 )     1,235       (3,122 )     3,456  
Other     2,106       2,264       2,217       4,370       4,160  
Total Non-interest Income     9,905       9,959       12,315       19,864       24,028  
Non-interest Expense                                        
Compensation and employee benefits     15,931       16,351       15,869       32,282       30,337  
Occupancy, net     2,131       2,505       2,170       4,636       4,434  
Data processing     2,171       2,144       2,251       4,315       4,129  
Furniture, fixtures and equipment     1,006       1,029       1,019       2,035       1,986  
Communications     717       769       704       1,486       1,384  
Interchange expense     753       688       661       1,441       1,259  
Advertising     627       672       543       1,299       984  
Loan and collection     628       634       692       1,262       1,369  
Legal and professional     371       369       456       740       834  
FDIC deposit insurance     342       368       250       710       480  
Credit card and bank service fees     97       103       106       200       202  
Net (gains) losses on other real estate                                        
and repossessed assets     (198 )     119       (4 )     (79 )     (294 )
Merger related expenses     -       -       3,082       -       3,256  
Other     2,016       2,239       1,962       4,255       3,536  
Total Non-interest Expense     26,592       27,990       29,761       54,582       53,896  
Income Before Income Tax     13,417       11,548       10,884       24,965       22,083  
Income tax expense     2,687       2,167       2,067       4,854       4,105  
Net Income   $ 10,730     $ 9,381     $ 8,817     $ 20,111     $ 17,978  
Net Income Per Common Share                                        
Basic   $ 0.47     $ 0.40     $ 0.37     $ 0.86     $ 0.79  
Diluted   $ 0.46     $ 0.39     $ 0.36     $ 0.85     $ 0.78  
                                         
                                         

 

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Selected Financial Data
                     
  June 30,   March 31,   December 31,   September 30,   June 30,  
  2019   2019   2018   2018   2018  
                                 
  (unaudited)  
  (Dollars in thousands except per share data)
Three Months Ended                                
Net interest income $ 30,756   $ 30,243   $ 30,669   $ 29,697     $ 28,980  
Provision for loan losses   652     664     591     (53 )     650  
Non-interest income   9,905     9,959     8,951     11,836       12,315  
Non-interest expense   26,592     27,990     26,825     26,740       29,761  
Income before income tax   13,417     11,548     12,204     14,846       10,884  
Income tax expense   2,687     2,167     2,268     2,921       2,067  
Net income $ 10,730   $ 9,381   $ 9,936   $ 11,925     $ 8,817  
                                 
Basic earnings per share $ 0.47   $ 0.40   $ 0.41   $ 0.49     $ 0.37  
Diluted earnings per share   0.46     0.39     0.41     0.49       0.36  
Cash dividend per share   0.18     0.18     0.15     0.15       0.15  
                                 
Average shares outstanding   23,035,526     23,588,313     23,988,810     24,148,768       24,109,322  
Average diluted shares outstanding   23,313,346     23,884,744     24,339,782     24,514,814       24,509,963  
                                 
Performance Ratios                                
Return on average assets   1.27 %   1.13 %   1.18 %   1.46   %   1.12 %
Return on average common equity   12.72     11.14     11.43     13.83       10.57  
Efficiency ratio (1)   64.57     69.27     67.11     63.63       71.14  
                                 
As a Percent of Average Interest-Earning Assets (1)                                
Interest income   4.73 %   4.70 %   4.66 %   4.53   %   4.49 %
Interest expense   0.86     0.82     0.73     0.62       0.56  
Net interest income   3.87     3.88     3.93     3.91       3.93  
                                 
Average Balances                                
Loans $ 2,699,648   $ 2,621,871   $ 2,627,614   $ 2,550,302     $ 2,449,056  
Securities available for sale   441,523     446,734     433,903     442,949       470,427  
Total earning assets   3,191,264     3,152,177     3,121,640     3,038,221       2,963,982  
Total assets   3,388,398     3,357,003     3,327,002     3,247,603       3,168,196  
Deposits   2,929,885     2,909,096     2,873,889     2,789,969       2,701,362  
Interest bearing liabilities   2,155,660     2,115,549     2,058,720     1,986,905       1,946,287  
Shareholders' equity   338,254     341,592     344,779     341,998       334,626  
                                 
End of Period                                
Capital                                
Tangible common equity ratio   8.72 %   9.26 %   9.17 %   9.51   %   9.41 %
Average equity to average assets   9.98     10.18     10.36     10.53       10.56  
Tangible common equity per share                                
of common stock $ 13.19   $ 13.17   $ 12.90   $ 12.84     $ 12.47  
Total shares outstanding   22,498,776     23,560,179     23,579,725     24,150,341       24,143,044  
                                 
Selected Balances                                
Loans $ 2,706,526   $ 2,618,795   $ 2,582,520   $ 2,562,578     $ 2,467,317  
Securities available for sale   430,305     461,531     427,926     436,957       450,593  
Total earning assets   3,239,247     3,180,655     3,162,911     3,078,083       3,023,454  
Total assets   3,438,302     3,383,606     3,353,281     3,297,124       3,234,522  
Deposits   2,978,885     2,934,225     2,913,428     2,798,643       2,780,516  
Interest bearing liabilities   2,194,970     2,141,083     2,098,967     2,036,770       1,988,495  
Shareholders' equity   330,846     344,726     338,994     345,204       337,083  
                                 
(1)  Presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.          
           

Reconciliation of Non-GAAP Financial Measures
Independent Bank Corporation

Independent Bank Corporation believes non-GAAP measures are meaningful because they reflect adjustments commonly made by management, investors, regulators and analysts to evaluate the adequacy of common equity and performance trends.  Tangible common equity is used by the Company to measure the quality of capital.

Reconciliation of Non-GAAP Financial Measures                
  Three Months Ended   Six Months Ended
  June 30,   June 30,
  2019
  2018
  2019
  2018
                               
  (Dollars in thousands)
Net Interest Margin, Fully Taxable                                
Equivalent ("FTE")                                
                               
Net interest income $ 30,756     $ 28,980     $ 60,999     $ 52,916  
Add:  taxable equivalent adjustment   102       132       219       261  
Net interest income - taxable equivalent $ 30,858     $ 29,112     $ 61,218     $ 53,177  
Net interest margin (GAAP) (1)   3.86 %     3.92 %     3.86 %     3.81 %
Net interest margin (FTE) (1)   3.87 %     3.93 %     3.88 %     3.83 %
 
(1) Annualized.  

 

  Tangible Common Equity Ratio                    
  June 30,   March 31,   December 31,   September 30,   June 30,
  2019   2019   2018   2018   2018
                                       
  (Dollars in thousands)
Common shareholders' equity $ 330,846     $ 344,726     $ 338,994     $ 345,204     $ 337,083  
Less:                  
Goodwill   28,300       28,300       28,300       28,300       29,012  
Other intangibles   5,870       6,143       6,415       6,709       7,004  
Tangible common equity $ 296,676     $ 310,283     $ 304,279     $ 310,195     $ 301,067  
                   
Total assets $ 3,438,302     $ 3,383,606     $ 3,353,281     $ 3,297,124     $ 3,234,522  
Less:                  
Goodwill   28,300       28,300       28,300       28,300       29,012  
Other intangibles   5,870       6,143       6,415       6,709       7,004  
Tangible assets $ 3,404,132     $ 3,349,163     $ 3,318,566     $ 3,262,115     $ 3,198,506  
                   
Common equity ratio   9.62 %     10.19 %     10.11 %     10.47 %     10.42 %
Tangible common equity ratio   8.72 %     9.26 %     9.17 %     9.51 %     9.41 %
                   
  Tangible Common Equity per Share of Common Stock:                                        
                                       
Common shareholders' equity $ 330,846     $ 344,726     $ 338,994     $ 345,204     $ 337,083  
Tangible common equity $ 296,676     $ 310,283     $ 304,279     $ 310,195     $ 301,067  
Shares of common stock  
outstanding (in thousands)   22,499       23,560       23,580       24,150       24,143  
 
Common shareholders' equity per share  
of common stock $ 14.70     $ 14.63     $ 14.38     $ 14.29     $ 13.96  
Tangible common equity per share    
of common stock $ 13.19     $ 13.17     $ 12.90     $ 12.84     $ 12.47  

The tangible common equity ratio removes the effect of goodwill and other intangible assets from capital and total assets.  Tangible common equity per share of common stock removes the effect of goodwill and other intangible assets from common shareholders’ equity per share of common stock.

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