Prosperity Bancshares Inc.
04/24/2024 | Press release | Distributed by Public on 04/24/2024 04:31
PROSPERITY BANCSHARES, INC.® REPORTS FIRST QUARTER 2024 EARNINGS - Form 8-K
PROSPERITY BANCSHARES, INC.®
REPORTS FIRST QUARTER
2024 EARNINGS
•
Net income of $110.4 million and diluted earnings per share of $1.18 for first quarter 2024
•
Loans, excluding Warehouse Purchase Program loans and loans acquired in the merger of First Bancshares of Texas, Inc, increased $115.8 million or 0.6% (2.4% annualized) during first quarter 2024
•
Deposits, excluding public funds deposits, increased $109.8 million during first quarter 2024, with no brokered deposits purchased
•
Noninterest-bearing deposits of $9.5 billion, representing 35.1% of total deposits
•
Net interest margin increased 4 basis points to 2.79% during first quarter 2024
•
Allowance for credit losses on loans and on off-balance sheet credit exposure of $366.7 million and allowance for credit losses on loans to total loans, excluding Warehouse Purchase Program, of 1.62%(1)
•
Nonperforming assets remain low at 0.24% of first quarter average interest-earning assets
•
Completed the merger of Lone Star State Bancshares, Inc. on April 1, 2024
•
Repurchased 567,692 shares of common stock during first quarter 2024
HOUSTON, April 24, 2024. Prosperity Bancshares, Inc.® (NYSE: PB), the parent company of Prosperity Bank® (collectively, "Prosperity"), reported net income of $110.4 million for the quarter ended March 31, 2024 compared with $124.7 million for the same period in 2023. Net income per diluted common share was $1.18 for the quarter ended March 31, 2024 compared with $1.37 for the same period in 2023. On April 1, 2024, Lone Star State Bancshares, Inc. ("Lone Star") merged with Prosperity Bancshares and Lone Star State Bank of West Texas ("Lone Star Bank") merged with Prosperity Bank. The annualized return on first quarter average assets was 1.13%. Nonperforming assets remain low at 0.24% of first quarter average interest-earning assets.
"We are excited to announce that on April 1, 2024, we completed the merger with Lone Star and its wholly owned subsidiary Lone Star Bank, headquartered in Lubbock, Texas. The operational integration is scheduled for late October 2024, when Lone Star customers will have full access to our 288 full-service locations. We welcome the Lone Star customers and associates to Prosperity and will work hard to win your trust," said David Zalman, Prosperity's Senior Chairman and Chief Executive Officer.
"The $2.4 trillion Texas economy is now the eight-largest economy in the world - larger than Russia, Canada, Italy and others. Texas is the top state for Fortune 500 headquartered companies, currently at 55, and was named the 2023 state of year for best in nation business climate and job growth," added Zalman.
______________
(1)
Refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.
Page 1
"Texas added 369,600 non-farm jobs in 2023, the most in the nation. We believe the Texas and Oklahoma economies should outperform most other states," continued Zalman.
"Prosperity continues to focus on long term relationships and our customers' success while maintaining strong asset quality and earnings, and a fair return to shareholders. Prosperity maintained a high tangible equity to tangible assets ratio of 10.33% for the first quarter 2024 while sharing earnings with our shareholders. Prosperity repurchased 567,692 shares of common stock during the first quarter of 2024 in addition to the quarterly dividend. In 2023, Prosperity's total capital return to shareholders from dividends and share repurchases was $278 million," concluded Zalman.
Results of Operations for the Three Months Ended March 31, 2024
For the three months ended March 31, 2024, net income was $110.4 million(2) or $1.18 per diluted common share compared with $95.5 million(3) or $1.02 per diluted common share for the three months ended December 31, 2023. The change was primarily due to higher interest income and lower FDIC assessments, partially offset by an increase in salaries and benefits and interest expense. For the three months ended March 31, 2024, net income was $110.4 million(2) or $1.18 per diluted common share compared with $124.7 million(4) or $1.37 per diluted common share for the same period in 2023. The change was primarily due to a decrease in net interest income and an increase in noninterest expense primarily due to an increase in salaries and benefits and expenses due to the merger of First Bancshares of Texas, Inc. (the "FB Merger"). Annualized returns on average assets, average common equity and average tangible common equity for the three months ended March 31, 2024 were 1.13%, 6.20% and 12.06%(1), respectively. Prosperity's efficiency ratio (excluding net gains and losses on the sale or write down of assets and securities) was 49.07%(1) for the three months ended March 31, 2024.
Net interest income before provision for credit losses was $238.2 million for the three months ended March 31, 2024 compared with $237.0 million for the three months ended December 31, 2023, an increase of $1.3 million or 0.5%. Net interest income before provision for credit losses decreased $5.2 million or 2.1% to $238.2 million for the three months ended March 31, 2024 compared with $243.5 million for the same period in 2023. The change was primarily due to an increase in the average balances on other borrowings, an increase in the average rates on interest-bearing deposits and a decrease in the average balance on investment securities, partially offset by an increase in the average balances and average rates on loans.
The net interest margin on a tax equivalent basis was 2.79% for the three months ended March 31, 2024 compared with 2.75% for the three months ended December 31, 2023. The net interest margin on a tax equivalent basis was 2.79% for the three months ended March 31, 2024 compared with 2.93% for the same period in 2023. The change was primarily due to an increase in the average balances on other borrowings, an increase in the average rates on interest-bearing deposits and a decrease in the average balance on investment securities, partially offset by an increase in the average balances and average rates on loans.
Noninterest income was $38.9 million for the three months ended March 31, 2024 compared with $36.6 million for the three months ended December 31, 2023, an increase of $2.3 million or 6.3%. The change was primarily due to increases in trust income and other noninterest income. Noninterest income was $38.9 million for the three months ended March 31, 2024 compared with $38.3 million for the same period in 2023, an increase of $604 thousand or 1.6%.
Noninterest expense was $135.8 million for the three months ended March 31, 2024 compared with $152.2 million for the three months ended December 31, 2023, a decrease of $16.3 million or 10.7%. The change was primarily due to lower FDIC assessments, partially offset by an increase in salaries and benefits. Noninterest expense was $135.8 million for the three months ended March 31, 2024 compared with $123.0 million for the same period in 2023, an increase of $12.8 million or 10.4%. The change was primarily due to increases in salaries and benefits, other noninterest expense and in credit and debit card, data processing and software amortization expense primarily due to three months of operations related to the FB Merger in the first quarter 2024 compared to none in the first quarter 2023.
Balance Sheet Information
At March 31, 2024, Prosperity had $38.757 billion in total assets, an increase of $927.3 million or 2.5%, compared with $37.829 billion at March 31, 2023.
______________
(2)
Includes purchase accounting adjustments of $2.0 million, net of tax, primarily comprised of loan discount accretion of $1.9 million for the three months ended March 31, 2024.
(3)
Includes purchase accounting adjustments of $2.6 million, net of tax, primarily comprised of loan discount accretion of $2.5 million, merger related expenses of $278 thousand, and the FDIC special assessment of $19.9 million for the three months ended December 31, 2023.
(4)
Includes purchase accounting adjustments of $728 thousand, net of tax, primarily comprised of loan discount accretion of $871 thousand, and merger related expenses of $860 thousand for the three months ended March 31, 2023.
Page 2
Loans were $21.265 billion at March 31, 2024, an increase of $84.7 million or 0.4% (1.6% annualized) from $21.181 billion at December 31, 2023. Loans increased $1.931 billion or 10.0%, compared with $19.334 billion at March 31, 2023. Loans, excluding Warehouse Purchase Program loans, were $20.400 billion at March 31, 2024 compared with $20.358 billion at December 31, 2023, an increase of $42.0 million or 0.2% (0.8% annualized), and $18.535 billion at March 31, 2023, an increase of $1.865 billion or 10.1%.
Deposits were $27.176 billion at March 31, 2024, a decrease of $4.3 million from $27.180 billion at December 31, 2023. Deposits increased $171.3 million or 0.6%, compared with $27.004 billion at March 31, 2023. Deposits, excluding public funds deposits, were $24.558 billion at March 31, 2024 compared with $24.448 billion at December 31, 2023, an increase of $109.8 million or 0.4%. Deposits, excluding public funds deposits, increased $660.8 million or 2.8% compared with $23.897 billion at March 31, 2023.
The table below provides detail on the impact of loans acquired and deposits assumed in the FB Merger.
|
Balance Sheet Data (at period end) |
||||||||||
|
(In thousands) |
||||||||||
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
||||||
|
(Unaudited) |
(Unaudited) |
(Unaudited) |
(Unaudited) |
(Unaudited) |
||||||
|
Loans acquired (including new production since acquisition date): |
||||||||||
|
FirstCapital Bank |
$ |
1,302,582 |
$ |
1,376,356 |
$ |
1,494,378 |
$ |
1,590,137 |
$ |
- |
|
Prosperity - Warehouse Purchase Program loans |
864,924 |
822,245 |
912,327 |
1,148,883 |
799,115 |
|||||
|
Prosperity - All other loans |
19,097,741 |
18,981,937 |
19,026,008 |
18,914,926 |
18,535,244 |
|||||
|
Total loans |
$ |
21,265,247 |
$ |
21,180,538 |
$ |
21,432,713 |
$ |
21,653,946 |
$ |
19,334,359 |
|
Deposits assumed (including new deposits since acquisition date): |
||||||||||
|
FirstCapital Bank |
$ |
1,449,166 |
$ |
1,517,217 |
$ |
1,625,691 |
$ |
1,481,831 |
$ |
- |
|
All other deposits |
25,726,352 |
25,662,592 |
25,687,109 |
25,899,055 |
27,004,236 |
|||||
|
Total deposits |
$ |
27,175,518 |
$ |
27,179,809 |
$ |
27,312,800 |
$ |
27,380,886 |
$ |
27,004,236 |
Excluding loans acquired in the FB Merger and new production since May 1, 2023 by the acquired lending operations, loans at March 31, 2024 grew $158.5 million or 0.8% (3.2% annualized) compared with December 31, 2023 and grew $628.3 million or 3.2% compared with March 31, 2023. Excluding loans acquired in the FB Merger, new production since May 1, 2023 by the acquired lending operations and Warehouse Purchase Program loans, loans at March 31, 2024 grew $115.8 million or 0.6% (2.4% annualized) compared with December 31, 2023 and grew $562.5 million or 3.0% compared with March 31, 2023.
Excluding deposits assumed in the FB Merger and new deposits generated at the acquired banking centers since May 1, 2023, deposits at March 31, 2024 grew by $63.8 million or 0.2% (1.0% annualized) compared with December 31, 2023 and decreased by $1.278 billion or 4.7% compared with March 31, 2023.
Asset Quality
Nonperforming assets totaled $83.8 million or 0.24% of quarterly average interest-earning assets at March 31, 2024 compared with $72.7 million or 0.21% of quarterly average interest-earning assets at December 31, 2023, with the majority of the balance for each period attributable to acquired loans. Nonperforming assets were $24.5 million or 0.07% of quarterly average interest-earning assets at March 31, 2023.
The allowance for credit losses on loans and off-balance sheet credit exposures was $366.7 million at March 31, 2024 compared with $368.9 million at December 31, 2023 and $312.1 million at March 31, 2023. There was no provision for credit losses for the three months ended March 31, 2024, December 31, 2023 and March 31, 2023.
The allowance for credit losses on loans was $330.2 million or 1.55% of total loans at March 31, 2024 compared with $332.4 million or 1.57% of total loans at December 31, 2023 and $282.2 million or 1.46% of total loans at March 31, 2023. Excluding Warehouse Purchase Program loans, the allowance for credit losses on loans to total loans was 1.62%(1) at March 31, 2024 compared with 1.63%(1) at December 31, 2023 and 1.52%(1) at March 31, 2023.
Net charge-offs were $2.1 million for the three months ended March 31, 2024 compared with net charge-offs of $19.1 million for the three months ended December 31, 2023 and net recoveries of $615 thousand for the three months ended March 31, 2023. Net charge-offs for the first quarter of 2024 included $991 thousand related to resolved purchased credit deteriorated ("PCD") loans, which had specific reserves that were allocated to the charge-offs. Further, an additional $4.1 million of specific reserves on resolved PCD loans without any related charge-offs was released to the general reserve.
Page 3
Dividend
Prosperity Bancshares declared a second quarter 2024 cash dividend of $0.56 per share to be paid on July 1, 2024, to all shareholders of record as of June 14, 2024.
Stock Repurchase Program
On January 16, 2024, Prosperity Bancshares announced a stock repurchase program under which up to 5%, or approximately 4.7 million shares, of its outstanding common stock may be acquired over a one-year period expiring on January 16, 2025, at the discretion of management. Under its 2024 stock repurchase program, Prosperity Bancshares repurchased 567,692 shares of its common stock at an average weighted price of $62.12 per share during the three months ended March 31, 2024.
Merger of Lone Star State Bancshares, Inc.
On April 1, 2024, Prosperity completed the merger of Lone Star and its wholly owned subsidiary Lone Star Bank, headquartered in Lubbock, Texas. Lone Star Bank operated 5 banking offices in the West Texas area, including its main office in Lubbock, and 1 banking center in each of Brownfield, Midland, Odessa and Big Spring, Texas. As of March 31, 2024, Lone Star, on a consolidated basis, reported total assets of $1.384 billion, total loans of $1.075 billion and total deposits of $1.241 billion.
Pursuant to the terms of the definitive agreement, Prosperity issued 2,376,182 shares of Prosperity common stock plus approximately $64.1 million in cash for all outstanding shares of Lone Star in the second quarter of 2024.
Merger of First Bancshares of Texas, Inc.
On May 1, 2023, Prosperity completed the merger of First Bancshares and its wholly owned subsidiary FirstCapital Bank of Texas, N.A. ("FirstCapital Bank"), headquartered in Midland, Texas. FirstCapital Bank operated 16 full-service banking offices in six different markets in West, North and Central Texas areas, including its main office in Midland, and banking offices in Midland, Lubbock, Amarillo, Wichita Falls, Burkburnett, Byers, Henrietta, Dallas, Horseshoe Bay, Marble Falls and Fredericksburg, Texas.
Pursuant to the terms of the definitive agreement, Prosperity issued 3,583,370 shares of Prosperity common stock plus approximately $91.5 million in cash for all outstanding shares of First Bancshares. This resulted in goodwill of $164.8 million as of March 31, 2024, which was subject to subsequent fair value adjustments. During the second quarter of 2023, Prosperity completed the operational conversion of FirstCapital Bank.
Conference Call
Prosperity's management team will host a conference call on Wednesday, April 24, 2024, at 11:30 a.m. Eastern Time (10:30 a.m. Central Time) to discuss Prosperity's first quarter 2024 earnings. Individuals and investment professionals may participate in the call by dialing 1-877-883-0383 for domestic participants, or 1-412-902-6506 for international participants. The participant elite entry number is 5323694.
Alternatively, individuals may listen to the live webcast of the presentation by visiting Prosperity's website at www.prosperitybankusa.com. The webcast may be accessed from Prosperity's Investor Relations page by selecting "Presentations, Webcasts & Calls" from the menu and following the instructions.
Non-GAAP Financial Measures
Prosperity's management uses certain non-GAAP financial measures to evaluate its performance. Specifically, for internal planning and forecasting purposes, Prosperity reviews each of diluted earnings per share, return on average assets, return on average common equity, and return on average tangible common equity, in each case excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and the FDIC special assessment, net of tax; return on average tangible common equity; tangible book value per share; the tangible equity to tangible assets ratio; allowance for credit losses to total loans excluding Warehouse Purchase Program loans; the efficiency ratio, excluding net gains and losses on the sale or write down of assets and securities; and the efficiency ratio, excluding net gains and losses on the sale or write down of assets and securities, merger related expenses and the FDIC special assessment. Prosperity believes these non-GAAP financial measures provide information useful to investors in understanding Prosperity's financial results and their presentation, together with the accompanying reconciliations, provides a more complete understanding of factors and trends affecting Prosperity's business and allows investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. Further, Prosperity believes that these non-GAAP financial measures provide useful information by excluding certain items that may not be indicative of its core operating earnings and business outlook. These non-GAAP financial measures should not be considered a substitute for, nor of greater
Page 4
importance than, GAAP basis financial measures and results; Prosperity 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. Please refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of these non-GAAP financial measures to the nearest respective GAAP financial measures.
Prosperity Bancshares, Inc. ®
As of March 31, 2024, Prosperity Bancshares, Inc.® is a $38.757 billion Houston, Texas based regional financial holding company providing personal banking services and investments to consumers and businesses throughout Texas and Oklahoma. Founded in 1983, Prosperity believes in a community banking philosophy, taking care of customers, businesses and communities in the areas it serves by providing financial solutions to simplify everyday financial needs. In addition to offering traditional deposit and loan products, Prosperity offers digital banking solutions, credit and debit cards, mortgage services, retail brokerage services, trust and wealth management, and treasury management.
Prosperity currently operates 288 full-service banking locations: 65 in the Houston area, including The Woodlands; 30 in the South Texas area including Corpus Christi and Victoria; 62 in the Dallas/Fort Worth area; 22 in the East Texas area; 31 in the Central Texas area including Austin and San Antonio; 44 in the West Texas area including Lubbock, Midland-Odessa, Abilene; Amarillo and Wichita Falls; 15 in the Bryan/College Station area, 6 in the Central Oklahoma area; 8 in the Tulsa, Oklahoma area and 5 in the West Texas area currently doing business as Lone Star Bank.
Cautionary Notes on Forward-Looking Statements
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This release contains, and the remarks by Prosperity's management on the conference call may contain, forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. From time to time, oral or written forward-looking statements may also be included in other information released to the public. Such forward-looking statements are typically, but not exclusively, identified by the use in the statements of words or phrases such as "aim," "anticipate," "believe," "estimate," "expect," "goal," "guidance," "intend," "is anticipated," "is expected," "is intended," "objective," "plan," "projected," "projection," "will affect," "will be," "will continue," "will decrease," "will grow," "will impact," "will increase," "will incur," "will reduce," "will remain," "will result," "would be," variations of such words or phrases (including where the word "could," "may," or "would" is used rather than the word "will" in a phrase) and similar words and phrases indicating that the statement addresses some future result, occurrence, plan or objective. Forward-looking statements include all statements other than statements of historical fact, including forecasts or trends, and are based on current expectations, assumptions, estimates and projections about Prosperity Bancshares and its subsidiaries. These forward-looking statements may include information about Prosperity's possible or assumed future economic performance or future results of operations, including future revenues, income, expenses, provision for loan losses, provision for taxes, effective tax rate, earnings per share and cash flows and Prosperity's future capital expenditures and dividends, future financial condition and changes therein, including changes in Prosperity's loan portfolio and allowance for loan losses, changes in deposits, borrowings and the investment securities portfolio, future capital structure or changes therein, as well as the plans and objectives of management for Prosperity's future operations, future or proposed acquisitions, the future or expected effect of acquisitions on Prosperity's operations, results of operations, financial condition, and future economic performance, statements about the anticipated benefits a proposed transaction, and statements about the assumptions underlying any such statement. These forward-looking statements are not guarantees of future performance and are based on expectations and assumptions Prosperity currently believes to be valid. Because forward-looking statements relate to future results and occurrences, many of which are outside of Prosperity's control, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. These risks and uncertainties include, but are not limited to, whether Prosperity can: successfully identify acquisition targets and integrate the businesses of acquired companies and banks; continue to sustain its current internal growth rate or total growth rate; provide products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its sales objectives. Other risks include, but are not limited to: the possibility that credit quality could deteriorate; actions of competitors; changes in laws and regulations (including changes in governmental interpretations of regulations and changes in accounting standards); the possibility that the anticipated benefits of an acquisition transaction are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of two companies or as a result of the strength of the economy and competitive factors generally; a deterioration or downgrade in the credit quality and credit agency ratings of the securities in Prosperity's securities portfolio; customer and consumer demand, including customer and consumer response to marketing; effectiveness of spending, investments or programs; fluctuations in the cost and availability of supply chain resources; economic conditions, including currency rate, interest rate and commodity price fluctuations; and the effect, impact, potential duration or other implications of weather and climate-related events. Prosperity disclaims any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments. These and various other factors are discussed in Prosperity's Annual Report on Form 10-K for the year
Page 5
ended December 31, 2023, and other reports and statements Prosperity has filed with the Securities and Exchange Commission ("SEC"). Copies of the SEC filings for Prosperity may be downloaded from the Internet at no charge from http://www.prosperitybankusa.com.
Page 6
|
Bryan/College Station Area |
Grapevine Main |
Tyler-South Broadway |
Tomball |
West |
|
Bryan |
Kiest |
Tyler-University |
Waller |
|
|
Bryan-29th Street |
Lake Highlands |
Winnsboro |
West Columbia |
Odessa |
|
Bryan-East |
McKinney |
Wharton |
Grandview |
|
|
Bryan-North |
McKinney Eldorado |
Houston Area |
Winnie |
Grant |
|
Caldwell |
McKinney Redbud |
Houston |
Wirt |
Kermit Highway |
|
College Station |
North Carrolton |
Aldine |
Parkway |
|
|
Hearne |
Park Cities |
Alief |
South Texas Area - |
|
|
Huntsville |
Plano |
Bellaire |
Corpus Christi |
Wichita Falls |
|
Madisonville |
Plano-West |
Beltway |
Calallen |
Cattlemans |
|
Navasota |
Preston Forest |
Clear Lake |
Carmel |
Kell |
|
New Waverly |
Preston Parker |
Copperfield |
Northwest |
|
|
Rock Prairie |
Preston Royal |
Cypress |
Saratoga |
Other West Texas Area |
|
Southwest Parkway |
Red Oak |
Downtown |
Timbergate |
Locations |
|
Tower Point |
Richardson |
Eastex |
Water Street |
Big Spring |
|
Wellborn Road |
Richardson-West |
Fairfield |
Brownfield |
|
|
Rosewood Court |
First Colony |
Victoria |
Brownwood |
|
|
Central Texas Area |
The Colony |
Fry Road |
Victoria Main |
Burkburnett |
|
Austin |
Tollroad |
Gessner |
Victoria-Navarro |
Byers |
|
Cedar Park |
Trinity Mills |
Gladebrook |
Victoria-North |
Cisco |
|
Congress |
Turtle Creek |
Grand Parkway |
Victoria Salem |
Comanche |
|
Lakeway |
West 15th Plano |
Heights |
Early |
|
|
Liberty Hill |
West Allen |
Highway 6 West |
Other South Texas Area |
Floydada |
|
Northland |
Westmoreland |
Little York |
Locations |
Gorman |
|
Oak Hill |
Wylie |
Medical Center |
Alice |
Henrietta |
|
Research Blvd |
Memorial Drive |
Aransas Pass |
Levelland |
|
|
Westlake |
Fort Worth |
Northside |
Beeville |
Littlefield |
|
Haltom City |
Pasadena |
Colony Creek |
Merkel |
|
|
Other Central Texas Area |
Hulen |
Pecan Grove |
Cuero |
Plainview |
|
Locations |
Keller |
Pin Oak |
Edna |
San Angelo |
|
Bastrop |
Museum Place |
River Oaks |
Goliad |
Slaton |
|
Canyon Lake |
Renaissance Square |
Sugar Land |
Gonzales |
Snyder |
|
Dime Box |
Roanoke |
SW Medical Center |
Hallettsville |
|
|
Dripping Springs |
Stockyards |
Tanglewood |
Kingsville |
Lone Star West Texas Area |
|
Elgin |
The Plaza |
Mathis |
Big Spring |
|
|
Flatonia |
Other Dallas/Fort Worth Area |
Uptown |
Padre Island |
Brownfield |
|
Fredericksburg |
Locations |
Waugh Drive |
Palacios |
Lubbock |
|
Georgetown |
Arlington |
Westheimer |
Port Lavaca |
Midland |
|
Gruene |
Azle |
West University |
Portland |
Odessa |
|
Horseshoe Bay |
Ennis |
Woodcreek |
Rockport |
|
|
Kingsland |
Gainesville |
Sinton |
Oklahoma |
|
|
La Grange |
Glen Rose |
Katy |
Taft |
Central Oklahoma Area |
|
Lexington |
Granbury |
Cinco Ranch |
Yoakum |
Oklahoma City |
|
Marble Falls |
Grand Prairie |
Katy-Spring Green |
Yorktown |
23rd Street |
|
New Braunfels |
Jacksboro |
Expressway |
||
|
Pleasanton |
Mesquite |
The Woodlands |
West Texas Area |
I-240 |
|
Round Rock |
Muenster |
The Woodlands-College Park |
Abilene |
Memorial |
|
San Antonio |
Runaway Bay |
The Woodlands-I-45 |
Antilley Road |
|
|
Schulenburg |
Sanger |
The Woodlands-Research Forest |
Barrow Street |
Other Central Oklahoma Area |
|
Seguin |
Waxahachie |
Cypress Street |
Locations |
|
|
Smithville |
Weatherford |
Other Houston Area |
Judge Ely |
Edmond |
|
Thorndale |
Locations |
Mockingbird |
Norman |
|
|
Weimar |
East Texas Area |
Angleton |
||
|
Athens |
Bay City |
Amarillo |
Tulsa Area |
|
|
Dallas/Fort Worth Area |
Blooming Grove |
Beaumont |
Hillside |
Tulsa |
|
Dallas |
Canton |
Cleveland |
Soncy |
Garnett |
|
14th Street Plano |
Carthage |
East Bernard |
Harvard |
|
|
Abrams Centre |
Corsicana |
El Campo |
Lubbock |
Memorial |
|
Addison |
Crockett |
Dayton |
4th Street |
Sheridan |
|
Allen |
Eustace |
Galveston |
66th Street |
S. Harvard |
|
Balch Springs |
Gilmer |
Groves |
82nd Street |
Utica Tower |
|
Camp Wisdom |
Grapeland |
Hempstead |
86th Street |
Yale |
|
Carrollton |
Gun Barrel City |
Hitchcock |
98th Street |
|
|
Cedar Hill |
Jacksonville |
Liberty |
Avenue Q |
Other Tulsa Area Locations |
|
Coppell |
Kerens |
Magnolia |
Milwaukee |
Owasso |
|
East Plano |
Longview |
Magnolia Parkway |
North University |
|
|
Euless |
Mount Vernon |
Mont Belvieu |
Texas Tech Student Union |
|
|
Frisco |
Palestine |
Nederland |
||
|
Frisco Warren |
Rusk |
Needville |
Midland |
|
|
Frisco-West |
Seven Points |
Rosenberg |
North |
|
|
Garland |
Teague |
Shadow Creek |
Wadley |
|
|
Grapevine |
Tyler-Beckham |
Spring |
Wall Street |
- - -
Page 7
Prosperity Bancshares, Inc.®
Financial Highlights (Unaudited)
(In thousands)
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
||||||
|
Balance Sheet Data (at period end) |
||||||||||
|
Loans held for sale |
$ |
6,380 |
$ |
5,734 |
$ |
10,187 |
$ |
10,656 |
$ |
1,603 |
|
Loans held for investment |
20,393,943 |
20,352,559 |
20,510,199 |
20,494,407 |
18,533,641 |
|||||
|
Loans held for investment - Warehouse Purchase Program |
864,924 |
822,245 |
912,327 |
1,148,883 |
799,115 |
|||||
|
Total loans |
21,265,247 |
21,180,538 |
21,432,713 |
21,653,946 |
19,334,359 |
|||||
|
Investment securities(A) |
12,301,138 |
12,803,896 |
13,192,742 |
13,667,319 |
14,071,545 |
|||||
|
Federal funds sold |
250 |
260 |
234 |
181 |
222 |
|||||
|
Allowance for credit losses on loans |
(330,219 |
) |
(332,362 |
) |
(351,495 |
) |
(345,209 |
) |
(282,191 |
) |
|
Cash and due from banks |
1,086,444 |
458,153 |
512,239 |
396,848 |
405,331 |
|||||
|
Goodwill |
3,396,402 |
3,396,086 |
3,396,459 |
3,383,698 |
3,231,636 |
|||||
|
Core deposit intangibles, net |
60,757 |
63,994 |
67,553 |
71,128 |
48,974 |
|||||
|
Other real estate owned |
2,204 |
1,708 |
9,320 |
3,107 |
1,989 |
|||||
|
Fixed assets, net |
372,333 |
369,992 |
370,237 |
365,299 |
345,149 |
|||||
|
Other assets |
601,964 |
605,612 |
665,682 |
708,814 |
672,218 |
|||||
|
Total assets |
$ |
38,756,520 |
$ |
38,547,877 |
$ |
39,295,684 |
$ |
39,905,131 |
$ |
37,829,232 |
|
Noninterest-bearing deposits |
$ |
9,526,535 |
$ |
9,776,572 |
$ |
10,281,893 |
$ |
10,364,921 |
$ |
10,108,348 |
|
Interest-bearing deposits |
17,648,983 |
17,403,237 |
17,030,907 |
17,015,965 |
16,895,888 |
|||||
|
Total deposits |
27,175,518 |
27,179,809 |
27,312,800 |
27,380,886 |
27,004,236 |
|||||
|
Other borrowings |
3,900,000 |
3,725,000 |
4,250,000 |
4,800,000 |
3,365,000 |
|||||
|
Securities sold under repurchase agreements |
261,671 |
309,277 |
300,714 |
434,160 |
434,261 |
|||||
|
Subordinated debentures |
- |
- |
- |
3,093 |
- |
|||||
|
Allowance for credit losses on off-balance sheet credit exposures |
36,503 |
36,503 |
36,503 |
36,503 |
29,947 |
|||||
|
Other liabilities |
278,284 |
217,958 |
362,990 |
282,373 |
256,671 |
|||||
|
Total liabilities |
31,651,976 |
31,468,547 |
32,263,007 |
32,937,015 |
31,090,115 |
|||||
|
Shareholders' equity(B) |
7,104,544 |
7,079,330 |
7,032,677 |
6,968,116 |
6,739,117 |
|||||
|
Total liabilities and equity |
$ |
38,756,520 |
$ |
38,547,877 |
$ |
39,295,684 |
$ |
39,905,131 |
$ |
37,829,232 |
(A) Includes $(2,954), $(1,770), $(2,442), $(3,393) and $(4,399) in unrealized losses on available for sale securities for the quarterly periods ended March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, respectively.
(B) Includes $(2,333), $(1,398), $(1,930), $(2,681) and $(3,476) in after-tax unrealized losses on available for sale securities for the quarterly periods ended March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, respectively.
Page 8
Prosperity Bancshares, Inc.®
Financial Highlights (Unaudited)
(In thousands)
|
Three Months Ended |
||||||||||
|
Mar 31, |
Dec 31, |
Sep 30, |
Jun 30, |
Mar 31, |
||||||
|
Income Statement Data |
||||||||||
|
Interest income: |
||||||||||
|
Loans |
$ |
306,228 |
$ |
306,562 |
$ |
308,678 |
$ |
286,638 |
$ |
247,118 |
|
Securities(C) |
66,421 |
68,077 |
69,987 |
72,053 |
73,185 |
|||||
|
Federal funds sold and other earning assets |
9,265 |
1,793 |
1,689 |
1,757 |
7,006 |
|||||
|
Total interest income |
381,914 |
376,432 |
380,354 |
360,448 |
327,309 |
|||||
|
Interest expense: |
||||||||||
|
Deposits |
92,692 |
84,969 |
76,069 |
63,964 |
47,343 |
|||||
|
Other borrowings |
48,946 |
52,386 |
62,190 |
57,351 |
34,396 |
|||||
|
Securities sold under repurchase agreements |
2,032 |
2,094 |
2,533 |
2,674 |
2,103 |
|||||
|
Subordinated debentures |
- |
- |
38 |
- |
- |
|||||
|
Total interest expense |
143,670 |
139,449 |
140,830 |
123,989 |
83,842 |
|||||
|
Net interest income |
238,244 |
236,983 |
239,524 |
236,459 |
243,467 |
|||||
|
Provision for credit losses |
- |
- |
- |
18,540 |
- |
|||||
|
Net interest income after provision for credit losses |
238,244 |
236,983 |
239,524 |
217,919 |
243,467 |
|||||
|
Noninterest income: |
||||||||||
|
Nonsufficient funds (NSF) fees |
8,288 |
8,365 |
8,719 |
8,512 |
8,095 |
|||||
|
Credit card, debit card and ATM card income |
8,861 |
9,314 |
9,285 |
9,206 |
8,666 |
|||||
|
Service charges on deposit accounts |
6,406 |
6,316 |
6,262 |
6,078 |
5,926 |
|||||
|
Trust income |
4,156 |
3,360 |
3,326 |
3,358 |
3,225 |
|||||
|
Mortgage income |
610 |
542 |
857 |
661 |
238 |
|||||
|
Brokerage income |
1,235 |
1,059 |
1,067 |
1,000 |
1,149 |
|||||
|
Bank owned life insurance income |
2,047 |
1,882 |
1,864 |
1,553 |
1,354 |
|||||
|
Net (loss) gain on sale or write-down of assets |
(35 |
) |
(84 |
) |
(45 |
) |
1,994 |
121 |
||
|
Net gain on sale of securities |
298 |
- |
- |
- |
- |
|||||
|
Other noninterest income |
7,004 |
5,814 |
7,408 |
7,326 |
9,492 |
|||||
|
Total noninterest income |
38,870 |
36,568 |
38,743 |
39,688 |
38,266 |
|||||
|
Noninterest expense: |
||||||||||
|
Salaries and benefits |
85,771 |
80,486 |
85,423 |
84,723 |
77,798 |
|||||
|
Net occupancy and equipment |
8,623 |
9,093 |
9,464 |
8,935 |
8,025 |
|||||
|
Credit and debit card, data processing and software amortization |
10,975 |
10,741 |
10,919 |
10,344 |
9,566 |
|||||
|
Regulatory assessments and FDIC insurance |
5,538 |
24,940 |
5,155 |
5,097 |
4,973 |
|||||
|
Core deposit intangibles amortization |
3,237 |
3,559 |
3,576 |
3,167 |
2,374 |
|||||
|
Depreciation |
4,686 |
4,607 |
4,585 |
4,658 |
4,433 |
|||||
|
Communications |
3,402 |
3,572 |
3,686 |
3,693 |
3,462 |
|||||
|
Other real estate expense |
187 |
165 |
153 |
(464 |
) |
58 |
||||
|
Net (gain) loss on sale or write-down of other real estate |
(138 |
) |
34 |
(734 |
) |
(33 |
) |
(13 |
) |
|
|
Merger related expenses |
- |
278 |
1,104 |
12,891 |
860 |
|||||
|
Other noninterest expense |
13,567 |
14,696 |
12,326 |
12,859 |
11,464 |
|||||
|
Total noninterest expense |
135,848 |
152,171 |
135,657 |
145,870 |
123,000 |
|||||
|
Income before income taxes |
141,266 |
121,380 |
142,610 |
111,737 |
158,733 |
|||||
|
Provision for income taxes |
30,840 |
25,904 |
30,402 |
24,799 |
34,039 |
|||||
|
Net income available to common shareholders |
$ |
110,426 |
$ |
95,476 |
$ |
112,208 |
$ |
86,938 |
$ |
124,694 |
(C) Interest income on securities was reduced by net premium amortization of $5,822, $6,428, $6,897, $7,131 and $7,384 for the three months ended March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, respectively.
Page 9
Prosperity Bancshares, Inc. ®
Financial Highlights (Unaudited)
(Dollars and share amounts in thousands, except per share data and market prices)
|
Three Months Ended |
||||||||||
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
||||||
|
Profitability |
||||||||||
|
Net income (D) (E) |
$ |
110,426 |
$ |
95,476 |
$ |
112,208 |
$ |
86,938 |
$ |
124,694 |
|
Basic earnings per share |
$ |
1.18 |
$ |
1.02 |
$ |
1.20 |
$ |
0.94 |
$ |
1.37 |
|
Diluted earnings per share |
$ |
1.18 |
$ |
1.02 |
$ |
1.20 |
$ |
0.94 |
$ |
1.37 |
|
Return on average assets (F)(J) |
1.13 |
% |
0.98 |
% |
1.13 |
% |
0.89 |
% |
1.31 |
% |
|
Return on average common equity (F)(J) |
6.20 |
% |
5.39 |
% |
6.39 |
% |
5.01 |
% |
7.38 |
% |
|
Return on average tangible common equity(F)(G)(J) |
12.06 |
% |
10.54 |
% |
12.58 |
% |
9.67 |
% |
14.34 |
% |
|
Tax equivalent net interest margin (D) (E)(H) |
2.79 |
% |
2.75 |
% |
2.72 |
% |
2.73 |
% |
2.93 |
% |
|
Efficiency ratio (G) (I)(K) |
49.07 |
% |
55.61 |
% |
48.74 |
% |
53.21 |
% |
43.68 |
% |
|
Liquidity and Capital Ratios |
||||||||||
|
Equity to assets |
18.33 |
% |
18.37 |
% |
17.90 |
% |
17.46 |
% |
17.81 |
% |
|
Common equity tier 1 capital |
15.78 |
% |
15.54 |
% |
14.98 |
% |
14.49 |
% |
15.59 |
% |
|
Tier 1 risk-based capital |
15.78 |
% |
15.54 |
% |
14.98 |
% |
14.49 |
% |
15.59 |
% |
|
Total risk-based capital |
17.08 |
% |
16.56 |
% |
16.05 |
% |
15.52 |
% |
16.41 |
% |
|
Tier 1 leverage capital |
10.37 |
% |
10.39 |
% |
10.03 |
% |
9.96 |
% |
10.06 |
% |
|
Period end tangible equity to period end tangible assets (G) |
10.33 |
% |
10.31 |
% |
9.96 |
% |
9.64 |
% |
10.01 |
% |
|
Other Data |
||||||||||
|
Weighted-average shares used in computing earnings per common share |
||||||||||
|
Basic |
93,706 |
93,715 |
93,720 |
92,930 |
91,207 |
|||||
|
Diluted |
93,706 |
93,715 |
93,720 |
92,930 |
91,207 |
|||||
|
Period end shares outstanding |
93,525 |
93,722 |
93,717 |
93,721 |
90,693 |
|||||
|
Cash dividends paid per common share |
$ |
0.56 |
$ |
0.56 |
$ |
0.55 |
$ |
0.55 |
$ |
0.55 |
|
Book value per common share |
$ |
75.96 |
$ |
75.54 |
$ |
75.04 |
$ |
74.35 |
$ |
74.31 |
|
Tangible book value per common share (G) |
$ |
39.00 |
$ |
38.62 |
$ |
38.08 |
$ |
37.49 |
$ |
38.13 |
|
Common Stock Market Price |
||||||||||
|
High |
$ |
68.88 |
$ |
68.79 |
$ |
63.65 |
$ |
63.13 |
$ |
78.76 |
|
Low |
$ |
60.08 |
$ |
49.60 |
$ |
52.62 |
$ |
55.12 |
$ |
58.25 |
|
Period end closing price |
$ |
65.78 |
$ |
67.73 |
$ |
54.58 |
$ |
56.48 |
$ |
61.52 |
|
Employees - FTE (excluding overtime) |
3,901 |
3,850 |
3,853 |
3,710 |
3,651 |
|||||
|
Number of banking centers |
283 |
285 |
285 |
286 |
272 |
(D) Includes purchase accounting adjustments for the periods presented as follows:
|
Three Months Ended |
|||||
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
|
|
Loan discount accretion |
|||||
|
Non-PCD |
$1,312 |
$1,543 |
$1,508 |
$1,242 |
$532 |
|
PCD |
$548 |
$937 |
$767 |
$1,178 |
$339 |
|
Securities net accretion (amortization) |
$561 |
$598 |
$626 |
$426 |
$(2) |
|
Time deposits amortization |
$(97) |
$(150) |
$(210) |
$(187) |
$(53) |
(E) Using effective tax rate of 21.8%, 21.3%, 21.3%, 22.2% and 21.4% for the three months ended March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, respectively.
(F) Interim periods annualized.
(G) Refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.
(H) Net interest margin for all periods presented is based on average balances on an actual 366-day or 365-day basis.
(I) Calculated by dividing total noninterest expense, excluding credit loss provisions, by net interest income plus noninterest income, excluding net gains and losses on the sale or write down of assets and securities. Additionally, taxes are not part of this calculation.
(J) For calculations of the annualized returns on average assets, average common equity and average tangible common equity excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax, refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.
(K) For calculations of the efficiency ratio excluding merger related expenses and FDIC special assessment refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of these non-GAAP financial measures to the nearest respective GAAP financial measures.
Page 10
Prosperity Bancshares, Inc.®
Financial Highlights (Unaudited)
(Dollars in thousands)
|
YIELD ANALYSIS |
Three Months Ended |
||||||||||||||
|
Mar 31, 2024 |
Dec 31, 2023 |
Mar 31, 2023 |
|||||||||||||
|
Average |
Interest |
Average |
(L) |
Average |
Interest |
Average |
(L) |
Average |
Interest |
Average |
(L) |
||||
|
Interest-earning assets: |
|||||||||||||||
|
Loans held for sale |
$ |
5,467 |
$ |
92 |
6.77% |
$ |
9,828 |
$ |
185 |
7.47% |
$ |
2,343 |
$ |
38 |
6.58% |
|
Loans held for investment |
20,415,316 |
292,673 |
5.77% |
20,370,915 |
291,882 |
5.68% |
18,317,712 |
236,606 |
5.24% |
||||||
|
Loans held for investment - Warehouse Purchase Program |
720,650 |
13,463 |
7.51% |
770,481 |
14,495 |
7.46% |
617,822 |
10,474 |
6.88% |
||||||
|
Total loans |
21,141,433 |
306,228 |
5.83% |
21,151,224 |
306,562 |
5.75% |
18,937,877 |
247,118 |
5.29% |
||||||
|
Investment securities |
12,693,268 |
66,421 |
2.10% |
(M) |
13,074,243 |
68,077 |
2.07% |
(M) |
14,332,509 |
73,185 |
2.07% |
(M) |
|||
|
Federal funds sold and other earning assets |
672,840 |
9,265 |
5.54% |
125,295 |
1,793 |
5.68% |
600,048 |
7,006 |
4.74% |
||||||
|
Total interest-earning assets |
34,507,541 |
381,914 |
4.45% |
34,350,762 |
376,432 |
4.35% |
33,870,434 |
327,309 |
3.92% |
||||||
|
Allowance for credit losses on loans |
(331,708 |
) |
(346,493 |
) |
(282,316 |
) |
|||||||||
|
Noninterest-earning assets |
4,759,697 |
4,810,942 |
4,589,735 |
||||||||||||
|
Total assets |
$ |
38,935,530 |
$ |
38,815,211 |
$ |
38,177,853 |
|||||||||
|
Interest-bearing liabilities: |
|||||||||||||||
|
Interest-bearing demand deposits |
$ |
5,143,585 |
$ |
8,423 |
0.66% |
$ |
4,822,698 |
$ |
6,789 |
0.56% |
$ |
5,877,641 |
$ |
3,792 |
0.26% |
|
Savings and money market deposits |
8,889,077 |
47,152 |
2.13% |
8,815,892 |
45,192 |
2.03% |
9,579,679 |
35,521 |
1.50% |
||||||
|
Certificates and other time deposits |
3,683,815 |
37,117 |
4.05% |
3,442,115 |
32,988 |
3.80% |
2,045,580 |
8,030 |
1.59% |
||||||
|
Other borrowings |
4,083,132 |
48,946 |
4.82% |
4,028,263 |
52,386 |
5.16% |
2,887,011 |
34,396 |
4.83% |
||||||
|
Securities sold under repurchase agreements |
296,437 |
2,032 |
2.76% |
300,317 |
2,094 |
2.77% |
427,887 |
2,103 |
1.99% |
||||||
|
Total interest-bearing liabilities |
22,096,046 |
143,670 |
2.62% |
(N) |
21,409,285 |
139,449 |
2.58% |
(N) |
20,817,798 |
83,842 |
1.63% |
(N) |
|||
|
Noninterest-bearing liabilities: |
|||||||||||||||
|
Noninterest-bearing demand deposits |
9,443,249 |
9,960,240 |
10,389,980 |
||||||||||||
|
Allowance for credit losses on off-balance sheet credit exposures |
36,503 |
36,503 |
29,947 |
||||||||||||
|
Other liabilities |
238,480 |
323,344 |
180,685 |
||||||||||||
|
Total liabilities |
31,814,278 |
31,729,372 |
31,418,410 |
||||||||||||
|
Shareholders' equity |
7,121,252 |
7,085,839 |
6,759,443 |
||||||||||||
|
Total liabilities and shareholders' equity |
$ |
38,935,530 |
$ |
38,815,211 |
$ |
38,177,853 |
|||||||||
|
Net interest income and margin |
$ |
238,244 |
2.78% |
$ |
236,983 |
2.74% |
$ |
243,467 |
2.92% |
||||||
|
Non-GAAP to GAAP reconciliation: |
|||||||||||||||
|
Tax equivalent adjustment |
808 |
952 |
833 |
||||||||||||
|
Net interest income and margin |
$ |
239,052 |
2.79% |
$ |
237,935 |
2.75% |
$ |
244,300 |
2.93% |
(L) Annualized and based on an actual 366-day or 365-day basis.
(M) Yield on securities was impacted by net premium amortization of $5,822, $6,428 and $7,384 for the three months ended March 31, 2024, December 31, 2023 and March 31, 2023, respectively.
(N) Total cost of funds, including noninterest bearing deposits, was 1.83%, 1.76% and 1.09% for the three months ended March 31, 2024, December 31, 2023 and March 31, 2023, respectively.
Page 11
Prosperity Bancshares, Inc.®
Financial Highlights (Unaudited)
(Dollars in thousands)
|
Three Months Ended |
||||||||||
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
||||||
|
YIELD TREND (O) |
||||||||||
|
Interest-Earning Assets: |
||||||||||
|
Loans held for sale |
6.77 |
% |
7.47 |
% |
6.54 |
% |
6.87 |
% |
6.58 |
% |
|
Loans held for investment |
5.77 |
% |
5.68 |
% |
5.62 |
% |
5.48 |
% |
5.24 |
% |
|
Loans held for investment - Warehouse Purchase Program |
7.51 |
% |
7.46 |
% |
7.32 |
% |
7.09 |
% |
6.88 |
% |
|
Total loans |
5.83 |
% |
5.75 |
% |
5.70 |
% |
5.55 |
% |
5.29 |
% |
|
Investment securities (P) |
2.10 |
% |
2.07 |
% |
2.05 |
% |
2.07 |
% |
2.07 |
% |
|
Federal funds sold and other earning assets |
5.54 |
% |
5.68 |
% |
5.33 |
% |
4.69 |
% |
4.74 |
% |
|
Total interest-earning assets |
4.45 |
% |
4.35 |
% |
4.30 |
% |
4.15 |
% |
3.92 |
% |
|
Interest-Bearing Liabilities: |
||||||||||
|
Interest-bearing demand deposits |
0.66 |
% |
0.56 |
% |
0.43 |
% |
0.30 |
% |
0.26 |
% |
|
Savings and money market deposits |
2.13 |
% |
2.03 |
% |
1.96 |
% |
1.88 |
% |
1.50 |
% |
|
Certificates and other time deposits |
4.05 |
% |
3.80 |
% |
3.31 |
% |
2.59 |
% |
1.59 |
% |
|
Other borrowings |
4.82 |
% |
5.16 |
% |
5.28 |
% |
5.20 |
% |
4.83 |
% |
|
Securities sold under repurchase agreements |
2.76 |
% |
2.77 |
% |
2.58 |
% |
2.43 |
% |
1.99 |
% |
|
Subordinated debentures |
- |
- |
5.85 |
% |
- |
- |
||||
|
Total interest-bearing liabilities |
2.62 |
% |
2.58 |
% |
2.54 |
% |
2.28 |
% |
1.63 |
% |
|
Net Interest Margin |
2.78 |
% |
2.74 |
% |
2.71 |
% |
2.72 |
% |
2.92 |
% |
|
Net Interest Margin (tax equivalent) |
2.79 |
% |
2.75 |
% |
2.72 |
% |
2.73 |
% |
2.93 |
% |
(O) Annualized and based on average balances on an actual 366-day or 365-day basis.
(P) Yield on securities was impacted by net premium amortization of $5,822, $6,428, $6,897, $7,131 and $7,384 for the three months ended March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, respectively.
Page 12
Prosperity Bancshares, Inc.®
Financial Highlights (Unaudited)
(Dollars in thousands)
|
Three Months Ended |
||||||||||
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
||||||
|
Balance Sheet Averages |
||||||||||
|
Loans held for sale |
$ |
5,467 |
$ |
9,828 |
$ |
9,832 |
$ |
3,910 |
$ |
2,343 |
|
Loans held for investment |
20,415,316 |
20,370,915 |
20,496,075 |
19,802,751 |
18,317,712 |
|||||
|
Loans held for investment - Warehouse Purchase Program |
720,650 |
770,481 |
972,936 |
898,768 |
617,822 |
|||||
|
Total loans |
21,141,433 |
21,151,224 |
21,478,843 |
20,705,429 |
18,937,877 |
|||||
|
Investment securities |
12,693,268 |
13,074,243 |
13,512,137 |
13,976,818 |
14,332,509 |
|||||
|
Federal funds sold and other earning assets |
672,840 |
125,295 |
125,690 |
150,300 |
600,048 |
|||||
|
Total interest-earning assets |
34,507,541 |
34,350,762 |
35,116,670 |
34,832,547 |
33,870,434 |
|||||
|
Allowance for credit losses on loans |
(331,708 |
) |
(346,493 |
) |
(343,967 |
) |
(283,594 |
) |
(282,316 |
) |
|
Cash and due from banks |
315,612 |
302,864 |
301,201 |
281,593 |
319,960 |
|||||
|
Goodwill |
3,396,177 |
3,396,224 |
3,387,293 |
3,291,659 |
3,231,637 |
|||||
|
Core deposit intangibles, net |
62,482 |
65,986 |
69,551 |
48,616 |
50,208 |
|||||
|
Other real estate |
2,319 |
4,781 |
6,301 |
2,712 |
2,083 |
|||||
|
Fixed assets, net |
372,458 |
370,900 |
367,814 |
357,593 |
342,380 |
|||||
|
Other assets |
610,649 |
670,187 |
697,176 |
756,500 |
643,467 |
|||||
|
Total assets |
$ |
38,935,530 |
$ |
38,815,211 |
$ |
39,602,039 |
$ |
39,287,626 |
$ |
38,177,853 |
|
Noninterest-bearing deposits |
$ |
9,443,249 |
$ |
9,960,240 |
$ |
10,269,162 |
$ |
10,274,819 |
$ |
10,389,980 |
|
Interest-bearing demand deposits |
5,143,585 |
4,822,698 |
4,768,485 |
5,147,453 |
5,877,641 |
|||||
|
Savings and money market deposits |
8,889,077 |
8,815,892 |
8,977,824 |
9,156,047 |
9,579,679 |
|||||
|
Certificates and other time deposits |
3,683,815 |
3,442,115 |
3,172,178 |
2,652,064 |
2,045,580 |
|||||
|
Total deposits |
27,159,726 |
27,040,945 |
27,187,649 |
27,230,383 |
27,892,880 |
|||||
|
Other borrowings |
4,083,132 |
4,028,263 |
4,671,449 |
4,427,914 |
2,887,011 |
|||||
|
Securities sold under repurchase agreements |
296,437 |
300,317 |
389,149 |
441,303 |
427,887 |
|||||
|
Subordinated debentures |
- |
- |
2,578 |
1,547 |
- |
|||||
|
Allowance for credit losses on off-balance sheet credit exposures |
36,503 |
36,503 |
36,504 |
30,022 |
29,947 |
|||||
|
Other liabilities |
238,480 |
323,344 |
290,217 |
220,775 |
180,685 |
|||||
|
Shareholders' equity |
7,121,252 |
7,085,839 |
7,024,493 |
6,935,682 |
6,759,443 |
|||||
|
Total liabilities and equity |
$ |
38,935,530 |
$ |
38,815,211 |
$ |
39,602,039 |
$ |
39,287,626 |
$ |
38,177,853 |
Page 13
Prosperity Bancshares, Inc.®
Financial Highlights (Unaudited)
(Dollars in thousands)
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
||||||
|
Period End Balances |
||||||||||
|
Loan Portfolio |
||||||||||
|
Commercial and industrial |
$1,932,534 |
9.1% |
$1,936,717 |
9.2% |
$2,153,391 |
10.1% |
$2,245,620 |
10.5% |
$2,074,078 |
10.7% |
|
Warehouse purchase program |
864,924 |
4.1% |
822,245 |
3.9% |
912,327 |
4.3% |
1,148,883 |
5.3% |
799,115 |
4.1% |
|
Construction, land development and other land loans |
2,876,588 |
13.5% |
3,076,591 |
14.5% |
3,200,479 |
14.9% |
3,215,016 |
14.8% |
2,899,980 |
15.0% |
|
1-4 family residential |
7,331,251 |
34.5% |
7,207,226 |
34.0% |
7,032,593 |
32.8% |
6,780,813 |
31.3% |
6,055,532 |
31.3% |
|
Home equity |
950,169 |
4.5% |
960,852 |
4.5% |
969,498 |
4.5% |
977,070 |
4.5% |
959,124 |
5.0% |
|
Commercial real estate (includes multi-family residential) |
5,631,460 |
26.5% |
5,662,948 |
26.7% |
5,606,837 |
26.2% |
5,676,526 |
26.2% |
5,133,693 |
26.6% |
|
Agriculture (includes farmland) |
813,092 |
3.8% |
816,043 |
3.9% |
801,933 |
3.7% |
804,376 |
3.7% |
721,395 |
3.7% |
|
Consumer and other |
326,915 |
1.5% |
329,593 |
1.6% |
306,018 |
1.4% |
305,207 |
1.4% |
288,300 |
1.5% |
|
Energy |
538,314 |
2.5% |
368,323 |
1.7% |
449,637 |
2.1% |
500,435 |
2.3% |
403,142 |
2.1% |
|
Total loans |
$21,265,247 |
$21,180,538 |
$21,432,713 |
$21,653,946 |
$19,334,359 |
|||||
|
Deposit Types |
||||||||||
|
Noninterest-bearing DDA |
$9,526,535 |
35.1% |
$9,776,572 |
36.0% |
$10,281,893 |
37.6% |
$10,364,921 |
37.9% |
$10,108,348 |
37.4% |
|
Interest-bearing DDA |
4,867,247 |
17.9% |
5,115,945 |
18.8% |
4,797,259 |
17.6% |
4,953,090 |
18.1% |
5,332,086 |
19.8% |
|
Money market |
6,134,221 |
22.6% |
5,859,701 |
21.6% |
5,892,505 |
21.6% |
5,904,160 |
21.5% |
6,021,449 |
22.3% |
|
Savings |
2,830,117 |
10.4% |
2,881,397 |
10.6% |
3,005,936 |
11.0% |
3,179,351 |
11.6% |
3,304,482 |
12.2% |
|
Certificates and other time deposits |
3,817,398 |
14.0% |
3,546,194 |
13.0% |
3,335,207 |
12.2% |
2,979,364 |
10.9% |
2,237,871 |
8.3% |
|
Total deposits |
$27,175,518 |
$27,179,809 |
$27,312,800 |
$27,380,886 |
$27,004,236 |
|||||
|
Loan to Deposit Ratio |
78.3% |
77.9% |
78.5% |
79.1% |
71.6% |
Page 14
Prosperity Bancshares, Inc.®
Financial Highlights (Unaudited)
(Dollars in thousands)
Construction Loans
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
||||||||||||||||
|
Single family residential construction |
$ |
1,031,163 |
35.8 |
% |
$ |
1,088,636 |
35.4 |
% |
$ |
1,157,016 |
36.1 |
% |
$ |
1,244,631 |
38.7 |
% |
$ |
1,179,883 |
40.7 |
% |
|
Land development |
290,243 |
10.1 |
% |
367,849 |
12.0 |
% |
359,518 |
11.2 |
% |
310,199 |
9.7 |
% |
222,511 |
7.7 |
% |
|||||
|
Raw land |
311,265 |
10.8 |
% |
328,365 |
10.7 |
% |
340,659 |
10.7 |
% |
359,228 |
11.2 |
% |
326,168 |
11.2 |
% |
|||||
|
Residential lots |
224,901 |
7.8 |
% |
222,591 |
7.2 |
% |
216,659 |
6.8 |
% |
216,706 |
6.7 |
% |
226,600 |
7.8 |
% |
|||||
|
Commercial lots |
59,691 |
2.1 |
% |
155,415 |
5.0 |
% |
154,425 |
4.8 |
% |
158,278 |
4.9 |
% |
167,151 |
5.8 |
% |
|||||
|
Commercial construction and other |
959,687 |
33.4 |
% |
914,436 |
29.7 |
% |
973,022 |
30.4 |
% |
927,025 |
28.8 |
% |
777,678 |
26.8 |
% |
|||||
|
Net unaccreted discount |
(362 |
) |
(701 |
) |
(820 |
) |
(1,051 |
) |
(11 |
) |
||||||||||
|
Total construction loans |
$ |
2,876,588 |
$ |
3,076,591 |
$ |
3,200,479 |
$ |
3,215,016 |
$ |
2,899,980 |
Non-Owner Occupied Commercial Real Estate Loans by Metropolitan Statistical Area (MSA) as of March 31, 2024
|
Houston |
Dallas |
Austin |
OK City |
Tulsa |
Other (Q) |
Total |
|||||||||
|
Collateral Type |
|||||||||||||||
|
Shopping center/retail |
$ |
347,702 |
$ |
278,496 |
$ |
58,938 |
$ |
14,763 |
$ |
14,413 |
$ |
287,241 |
$ |
1,001,553 |
|
|
Commercial and industrial buildings |
161,906 |
100,565 |
25,744 |
35,528 |
17,881 |
258,388 |
600,012 |
||||||||
|
Office buildings |
95,697 |
220,797 |
60,013 |
48,260 |
3,842 |
91,314 |
519,923 |
||||||||
|
Medical buildings |
75,558 |
18,489 |
1,727 |
43,390 |
31,984 |
57,686 |
228,834 |
||||||||
|
Apartment buildings |
136,913 |
126,568 |
17,998 |
14,395 |
13,437 |
199,616 |
508,927 |
||||||||
|
Hotel |
110,759 |
100,561 |
33,322 |
18,031 |
- |
167,511 |
430,184 |
||||||||
|
Other |
175,653 |
59,582 |
35,154 |
8,252 |
1,636 |
85,070 |
365,347 |
||||||||
|
Total |
$ |
1,104,188 |
$ |
905,058 |
$ |
232,896 |
$ |
182,619 |
$ |
83,193 |
$ |
1,146,826 |
$ |
3,654,780 |
(R) |
Acquired Loans
|
Non-PCD Loans |
PCD Loans |
Total Acquired Loans |
||||||||||||||||
|
Balance at |
Balance at |
Balance at |
Balance at |
Balance at |
Balance at |
Balance at |
Balance at |
Balance at |
||||||||||
|
Loan marks: |
||||||||||||||||||
|
Acquired banks (S) |
$ |
345,599 |
$ |
506 |
$ |
245 |
$ |
320,052 |
$ |
2,594 |
$ |
2,503 |
$ |
665,651 |
$ |
3,100 |
$ |
2,748 |
|
FirstCapital Bank (T) |
22,648 |
19,486 |
18,436 |
7,790 |
5,320 |
4,858 |
30,438 |
24,806 |
23,294 |
|||||||||
|
Total |
368,247 |
19,992 |
18,681 |
327,842 |
7,914 |
7,361 |
696,089 |
27,906 |
26,042 |
|||||||||
|
Acquired portfolio loan balances: |
||||||||||||||||||
|
Acquired banks (S) |
12,286,159 |
1,043,525 |
977,286 |
689,573 |
58,310 |
56,982 |
12,975,732 |
1,101,835 |
1,034,268 |
|||||||||
|
FirstCapital Bank (T) |
1,021,694 |
780,284 |
699,277 |
627,991 |
475,343 |
438,092 |
1,649,685 |
1,255,627 |
1,137,369 |
|||||||||
|
Total |
13,307,853 |
1,823,809 |
1,676,563 |
1,317,564 |
533,653 |
495,074 |
14,625,417 |
(U) |
2,357,462 |
2,171,637 |
||||||||
|
Acquired portfolio loan balances less loan marks |
$ |
12,939,606 |
$ |
1,803,817 |
$ |
1,657,882 |
$ |
989,722 |
$ |
525,739 |
$ |
487,713 |
$ |
13,929,328 |
$ |
2,329,556 |
$ |
2,145,595 |
(Q) Includes other MSA and non-MSA regions.
(R) Represents a portion of total commercial real estate loans of $5.631 billion as of March 31, 2024.
(S) Includes Bank Arlington, American State Bank, Community National Bank, First Federal Bank Texas, Coppermark Bank, First Victoria National Bank, The F&M Bank & Trust Company, Tradition Bank and LegacyTexas Bank.
(T) FirstCapital Bank merger was completed on May 1, 2023 and resulted in the addition of $1.650 billion in loans with related purchase accounting adjustments of $30.4 million at acquisition date, which were subject to subsequent fair value adjustments.
(U) Actual principal balances acquired.
Page 15
Prosperity Bancshares, Inc.®
Financial Highlights (Unaudited)
(Dollars in thousands)
|
Three Months Ended |
|||||||||||
|
Mar 31, 2024 |
Dec 31, 2023 |
Sep 30, 2023 |
Jun 30, 2023 |
Mar 31, 2023 |
|||||||
|
Asset Quality |
|||||||||||
|
Nonaccrual loans |
$ |
78,475 |
$ |
68,688 |
$ |
59,729 |
$ |
57,723 |
$ |
22,496 |
|
|
Accruing loans 90 or more days past due |
3,035 |
2,195 |
397 |
1,744 |
- |
||||||
|
Total nonperforming loans |
81,510 |
70,883 |
60,126 |
59,467 |
22,496 |
||||||
|
Repossessed assets |
97 |
76 |
35 |
153 |
- |
||||||
|
Other real estate |
2,204 |
1,708 |
9,320 |
3,107 |
1,989 |
||||||
|
Total nonperforming assets |
$ |
83,811 |
$ |
72,667 |
$ |
69,481 |
$ |
62,727 |
$ |
24,485 |
|
|
Nonperforming assets: |
|||||||||||
|
Commercial and industrial (includes energy) |
$ |
10,199 |
$ |
8,957 |
$ |
22,219 |
$ |
24,027 |
$ |
2,832 |
|
|
Construction, land development and other land loans |
15,826 |
17,343 |
8,684 |
4,245 |
3,210 |
||||||
|
1-4 family residential (includes home equity) |
30,206 |
26,096 |
23,708 |
19,609 |
16,951 |
||||||
|
Commercial real estate (includes multi-family residential) |
23,720 |
18,775 |
13,341 |
13,504 |
1,051 |
||||||
|
Agriculture (includes farmland) |
3,714 |
1,460 |
1,511 |
1,284 |
432 |
||||||
|
Consumer and other |
146 |
36 |
18 |
58 |
9 |
||||||
|
Total |
$ |
83,811 |
$ |
72,667 |
$ |
69,481 |
$ |
62,727 |
$ |
24,485 |
|
|
Number of loans/properties |
319 |
292 |
260 |
241 |
190 |
||||||
|
Allowance for credit losses on loans |
$ |
330,219 |
$ |
332,362 |
$ |
351,495 |
$ |
345,209 |
$ |
282,191 |
|
|
Net charge-offs (recoveries): |
|||||||||||
|
Commercial and industrial (includes energy) |
$ |
283 |
$ |
16,123 |
$ |
1,594 |
$ |
160 |
$ |
(1,472 |
) |
|
Construction, land development and other land loans |
(2 |
) |
(5 |
) |
(5 |
) |
50 |
(13 |
) |
||
|
1-4 family residential (includes home equity) |
457 |
20 |
(78 |
) |
(70 |
) |
(140 |
) |
|||
|
Commercial real estate (includes multi-family residential) |
(17 |
) |
1,590 |
570 |
14,957 |
(1 |
) |
||||
|
Agriculture (includes farmland) |
23 |
- |
- |
(78 |
) |
(6 |
) |
||||
|
Consumer and other |
1,399 |
1,405 |
1,327 |
1,046 |
1,017 |
||||||
|
Total |
$ |
2,143 |
$ |
19,133 |
$ |
3,408 |
$ |
16,065 |
$ |
(615 |
) |
|
Asset Quality Ratios |
|||||||||||
|
Nonperforming assets to average interest-earning assets |
0.24 |
% |
0.21 |
% |
0.20 |
% |
0.18 |
% |
0.07 |
% |
|
|
Nonperforming assets to loans and other real estate |
0.39 |
% |
0.34 |
% |
0.32 |
% |
0.29 |
% |
0.13 |
% |
|
|
Net charge-offs to average loans (annualized) |
0.04 |
% |
0.36 |
% |
0.06 |
% |
0.31 |
% |
(0.01%) |
||
|
Allowance for credit losses on loans to total loans |
1.55 |
% |
1.57 |
% |
1.64 |
% |
1.59 |
% |
1.46 |
% |
|
|
Allowance for credit losses on loans to total loans, excluding Warehouse Purchase Program loans (G) |
1.62 |
% |
1.63 |
% |
1.71 |
% |
1.68 |
% |
1.52 |
% |
Page 16
Prosperity Bancshares, Inc.®
Notes to Selected Financial Data (Unaudited)
(Dollars and share amounts in thousands, except per share data)
NOTES TO SELECTED FINANCIAL DATA
Prosperity's management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Specifically, for internal planning and forecasting purposes, Prosperity reviews each of diluted earnings per share, return on average assets, return on average common equity, and return on average tangible common equity, in each case excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and the FDIC special assessment, net of tax; return on average tangible common equity; tangible book value per share; the tangible equity to tangible assets ratio; allowance for credit losses to total loans excluding Warehouse Purchase Program loans; the efficiency ratio, excluding net gains and losses on the sale or write down of assets and securities; and the efficiency ratio, excluding net gains and losses on the sale or write down of assets and securities, merger related expenses and the FDIC special assessment. In addition, due to the application of purchase accounting, Prosperity uses certain non-GAAP financial measures and ratios that exclude the impact of these items to evaluate its allowance for credit losses to total loans (excluding Warehouse Purchase Program loans). Prosperity has included information below relating to these non-GAAP financial measures for the applicable periods presented.
|
Three Months Ended |
||||||||||
|
Mar 31, |
Dec 31, |
Sep 30, |
Jun 30, |
Mar 31, |
||||||
|
Reconciliation of diluted earnings per share to diluted earnings per share excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax: |
||||||||||
|
Diluted earnings per share (unadjusted) |
$ |
1.18 |
$ |
1.02 |
$ |
1.20 |
$ |
0.94 |
$ |
1.37 |
|
Net income |
$ |
110,426 |
$ |
95,476 |
$ |
112,208 |
$ |
86,938 |
$ |
124,694 |
|
Merger related provision for credit losses, net of tax(V) |
- |
- |
- |
14,647 |
- |
|||||
|
Merger related expenses, net of tax(V) |
- |
220 |
872 |
10,184 |
679 |
|||||
|
FDIC special assessment, net of tax(V) |
- |
15,736 |
- |
- |
- |
|||||
|
Net income excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax(V): |
$ |
110,426 |
$ |
111,432 |
$ |
113,080 |
$ |
111,769 |
$ |
125,373 |
|
Weighted average diluted shares outstanding |
93,706 |
93,715 |
93,720 |
92,930 |
91,207 |
|||||
|
Merger related provision for credit losses, net of tax, per diluted common share(V) |
$ |
- |
$ |
- |
$ |
- |
$ |
0.16 |
$ |
- |
|
Merger related expenses, net of tax, per diluted common share(V') |
$ |
- |
$ |
- |
$ |
0.01 |
$ |
0.11 |
$ |
0.01 |
|
FDIC special assessment, net of tax, per diluted common share(V) |
$ |
- |
$ |
0.17 |
$ |
- |
$ |
- |
$ |
- |
|
Diluted earnings per share excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax:(V) |
$ |
1.18 |
$ |
1.19 |
$ |
1.21 |
$ |
1.21 |
$ |
1.38 |
|
Reconciliation of return on average assets to return on average assets excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax: |
||||||||||
|
Return on average assets (unadjusted) |
1.13 |
% |
0.98 |
% |
1.13 |
% |
0.89 |
% |
1.31 |
% |
|
Net income excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax(V): |
$ |
110,426 |
$ |
111,432 |
$ |
113,080 |
$ |
111,769 |
$ |
125,373 |
|
Average total assets |
$ |
38,935,530 |
$ |
38,815,211 |
$ |
39,602,039 |
$ |
39,287,626 |
$ |
38,177,853 |
|
Return on average assets excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax (F) (V) |
1.13 |
% |
1.15 |
% |
1.14 |
% |
1.14 |
% |
1.31 |
% |
(V) Calculated assuming a federal tax rate of 21.0%.
Page 17
|
Three Months Ended |
||||||||||
|
Mar 31, |
Dec 31, |
Sep 30, |
Jun 30, |
Mar 31, |
||||||
|
Reconciliation of return on average common equity to return on average common equity excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax: |
||||||||||
|
Return on average common equity (unadjusted) |
6.20 |
% |
5.39 |
% |
6.39 |
% |
5.01 |
% |
7.38 |
% |
|
Net income, excluding merger related provision for credit losses, net of tax, and merger related expenses, net of tax, and FDIC special assessment, net of tax(V) |
$ |
110,426 |
$ |
111,432 |
$ |
113,080 |
$ |
111,769 |
$ |
125,373 |
|
Average shareholders' equity |
$ |
7,121,252 |
$ |
7,085,839 |
$ |
7,024,493 |
$ |
6,935,682 |
$ |
6,759,443 |
|
Return on average common equity excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax (F) (V) |
6.20 |
% |
6.29 |
% |
6.44 |
% |
6.45 |
% |
7.42 |
% |
|
Reconciliation of return on average common equity to return on average tangible common equity: |
||||||||||
|
Net income |
$ |
110,426 |
$ |
95,476 |
$ |
112,208 |
$ |
86,938 |
$ |
124,694 |
|
Average shareholders' equity |
$ |
7,121,252 |
$ |
7,085,839 |
$ |
7,024,493 |
$ |
6,935,682 |
$ |
6,759,443 |
|
Less: Average goodwill and other intangible assets |
(3,458,659 |
) |
(3,462,210 |
) |
(3,456,844 |
) |
(3,340,275 |
) |
(3,281,845 |
) |
|
Average tangible shareholders' equity |
$ |
3,662,593 |
$ |
3,623,629 |
$ |
3,567,649 |
$ |
3,595,407 |
$ |
3,477,598 |
|
Return on average tangible common equity(F) |
12.06 |
% |
10.54 |
% |
12.58 |
% |
9.67 |
% |
14.34 |
% |
|
Reconciliation of return on average common equity to return on average tangible common equity excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax: |
||||||||||
|
Net income, excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax(V) |
$ |
110,426 |
$ |
111,432 |
$ |
113,080 |
$ |
111,769 |
$ |
125,373 |
|
Average shareholders' equity |
$ |
7,121,252 |
$ |
7,085,839 |
$ |
7,024,493 |
$ |
6,935,682 |
$ |
6,759,443 |
|
Less: Average goodwill and other intangible assets |
(3,458,659 |
) |
(3,462,210 |
) |
(3,456,844 |
) |
(3,340,275 |
) |
(3,281,845 |
) |
|
Average tangible shareholders' equity |
$ |
3,662,593 |
$ |
3,623,629 |
$ |
3,567,649 |
$ |
3,595,407 |
$ |
3,477,598 |
|
Return on average tangible common equity excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, and FDIC special assessment, net of tax (F) (V) |
12.06 |
% |
12.30 |
% |
12.68 |
% |
12.43 |
% |
14.42 |
% |
|
Reconciliation of book value per share to tangible book value per share: |
||||||||||
|
Shareholders' equity |
$ |
7,104,544 |
$ |
7,079,330 |
$ |
7,032,677 |
$ |
6,968,116 |
$ |
6,739,117 |
|
Less: Goodwill and other intangible assets |
(3,457,159 |
) |
(3,460,080 |
) |
(3,464,012 |
) |
(3,454,826 |
) |
(3,280,610 |
) |
|
Tangible shareholders' equity |
$ |
3,647,385 |
$ |
3,619,250 |
$ |
3,568,665 |
$ |
3,513,290 |
$ |
3,458,507 |
|
Period end shares outstanding |
93,525 |
93,722 |
93,717 |
93,721 |
90,693 |
|||||
|
Tangible book value per share |
$ |
39.00 |
$ |
38.62 |
$ |
38.08 |
$ |
37.49 |
$ |
38.13 |
|
Reconciliation of equity to assets ratio to period end tangible equity to period end tangible assets ratio: |
||||||||||
|
Tangible shareholders' equity |
$ |
3,647,385 |
$ |
3,619,250 |
$ |
3,568,665 |
$ |
3,513,290 |
$ |
3,458,507 |
|
Total assets |
$ |
38,756,520 |
$ |
38,547,877 |
$ |
39,295,684 |
$ |
39,905,131 |
$ |
37,829,232 |
|
Less: Goodwill and other intangible assets |
(3,457,159 |
) |
(3,460,080 |
) |
(3,464,012 |
) |
(3,454,826 |
) |
(3,280,610 |
) |
|
Tangible assets |
$ |
35,299,361 |
$ |
35,087,797 |
$ |
35,831,672 |
$ |
36,450,305 |
$ |
34,548,622 |
|
Period end tangible equity to period end tangible assets ratio |
10.33 |
% |
10.31 |
% |
9.96 |
% |
9.64 |
% |
10.01 |
% |
Page 18
|
Three Months Ended |
||||||||||
|
Mar 31, |
Dec 31, |
Sep 30, |
Jun 30, |
Mar 31, |
||||||
|
Reconciliation of allowance for credit losses to total loans to allowance for credit losses on loans to total loans excluding Warehouse Purchase Program: |
||||||||||
|
Allowance for credit losses on loans |
$ |
330,219 |
$ |
332,362 |
$ |
351,495 |
$ |
345,209 |
$ |
282,191 |
|
Total loans |
$ |
21,265,247 |
$ |
21,180,538 |
$ |
21,432,713 |
$ |
21,653,946 |
$ |
19,334,359 |
|
Less: Warehouse Purchase Program loans |
(864,924 |
) |
(822,245 |
) |
(912,327 |
) |
(1,148,883 |
) |
(799,115 |
) |
|
Total loans less Warehouse Purchase Program |
$ |
20,400,323 |
$ |
20,358,293 |
$ |
20,520,386 |
$ |
20,505,063 |
$ |
18,535,244 |
|
Allowance for credit losses on loans to total loans excluding Warehouse Purchase Program |
1.62 |
% |
1.63 |
% |
1.71 |
% |
1.68 |
% |
1.52 |
% |
|
Reconciliation of efficiency ratio to efficiency ratio excluding net gains and losses on the sale or write down of assets and securities: |
||||||||||
|
Noninterest expense |
$ |
135,848 |
$ |
152,171 |
$ |
135,657 |
$ |
145,870 |
$ |
123,000 |
|
Net interest income |
$ |
238,244 |
$ |
236,983 |
$ |
239,524 |
$ |
236,459 |
$ |
243,467 |
|
Noninterest income |
38,870 |
36,568 |
38,743 |
39,688 |
38,266 |
|||||
|
Less: net (loss) gain on sale or write down of assets |
(35 |
) |
(84 |
) |
(45 |
) |
1,994 |
121 |
||
|
Less: net gain on sale of securities |
298 |
- |
- |
- |
- |
|||||
|
Noninterest income excluding net gains and losses on the sale or write down of assets and securities |
38,607 |
36,652 |
38,788 |
37,694 |
38,145 |
|||||
|
Total income excluding net gains and losses on the sale or write down of assets and securities |
$ |
276,851 |
$ |
273,635 |
$ |
278,312 |
$ |
274,153 |
$ |
281,612 |
|
Efficiency ratio, excluding net gains and losses on the sale or write down of assets and securities |
49.07 |
% |
55.61 |
% |
48.74 |
% |
53.21 |
% |
43.68 |
% |
|
Reconciliation of efficiency ratio to efficiency ratio, excluding net gains and losses on the sale or write down of assets and securities, merger related expenses and FDIC special assessment: |
||||||||||
|
Noninterest expense |
$ |
135,848 |
$ |
152,171 |
$ |
135,657 |
$ |
145,870 |
$ |
123,000 |
|
Less: merger related expenses |
- |
278 |
1,104 |
12,891 |
860 |
|||||
|
Less: FDIC special assessment |
- |
19,919 |
- |
- |
- |
|||||
|
Noninterest expense excluding merger related expenses and FDIC special assessment |
$ |
135,848 |
$ |
131,974 |
$ |
134,553 |
$ |
132,979 |
$ |
122,140 |
|
Net interest income |
$ |
238,244 |
$ |
236,983 |
$ |
239,524 |
$ |
236,459 |
$ |
243,467 |
|
Noninterest income |
38,870 |
36,568 |
38,743 |
39,688 |
38,266 |
|||||
|
Less: net (loss) gain on sale or write down of assets |
(35 |
) |
(84 |
) |
(45 |
) |
1,994 |
121 |
||
|
Less: net gain on sale of securities |
298 |
- |
- |
- |
- |
|||||
|
Noninterest income excluding net gains and losses on the sale or write down of assets and securities |
38,607 |
36,652 |
38,788 |
37,694 |
38,145 |
|||||
|
Total income excluding net gains and losses on the sale or write down of assets and securities |
$ |
276,851 |
$ |
273,635 |
$ |
278,312 |
$ |
274,153 |
$ |
281,612 |
|
Efficiency ratio, excluding net gains and losses on the sale or write down of assets and securities, merger related expenses and FDIC special assessment |
49.07 |
% |
48.23 |
% |
48.35 |
% |
48.51 |
% |
43.37 |
% |
Page 19