SOUTHERN
PINES, N.C., Oct. 25,
2023 /PRNewswire/ -- First Bancorp (the "Company")
(NASDAQ - FBNC), the parent company of First Bank, announced today
net income of $29.9 million, or
$0.73 per diluted common share, for
the three months ended September 30,
2023 compared to $29.4
million, or $0.71 per diluted
common share, for the three months ended June 30, 2023 ("linked quarter") and $37.9 million, or $1.06 per diluted common share, recorded in the
third quarter of 2022. For the nine months ended September 30, 2023, the Company recorded net
income of $74.5 million, or
$1.81 per diluted common share,
compared to $108.5 million, or
$3.04 per diluted common share, for
the nine months ended September 30,
2022.
On January 1, 2023, the Company
completed its acquisition of GrandSouth Bancorporation
("GrandSouth"). Comparisons for the financial periods
presented are impacted by the GrandSouth acquisition which
contributed $1.02 billion in loans
and $1.05 billion in deposits.
The results for the nine months ended September 30, 2023 include merger expenses
totaling $13.5 million and an initial
loan loss provision of $12.2 million
for acquired loans.
Richard H. Moore, CEO and
Chairman of the Company, stated, "Our Company has demonstrated once
again that our deposit base is very stable, comparatively low cost,
diversified and growing. We are a relationship-driven bank
and it has paid off in this market. When you consider our
deposit base, our low loan-to-deposit ratio, strong credit quality,
and almost no large office building credit exposure, we are
confident about our ability to stay well-positioned for the
remainder of the year and into next year."
Third Quarter 2023 Highlights
- Loans totaled $8.0 billion at
September 30, 2023, with growth for
the quarter of $129.4 million, an
annualized growth rate of 6.5%.
- Total market deposits (exclusive of brokered deposits) grew
$66.7 million for the quarter, an
annualized growth rate of 2.6%.
- Noninterest-bearing demand accounts remained strong at 34% of
total deposits at quarter end.
- Total loan yield increased to 5.32%, up 83 basis points from
the third quarter of 2022, with accretion on purchased loans
contributing 16 basis points to loan yield.
- While deposit rates increased during the quarter, total cost of
funds remained low at 1.46% for the quarter ended September 30, 2023.
- The on-balance sheet liquidity ratio was 14.4% at September 30, 2023. Available off-balance sheet
sources totaled $2.2 billion at
quarter end, resulting in a total liquidity ratio of 30.2%.
- Credit quality continued to be strong with a nonperforming
assets ("NPA") to total assets ratio of 0.32% as of September 30, 2023, down from 0.39% for the
comparable period of 2022.
- Capital remained strong with a total common equity tier 1 ratio
of 12.93% (estimated) and a total risk-based capital ratio of
15.26% (estimated) as of September 30,
2023.
Net Interest Income and Net Interest Margin
Net interest income for the third quarter of 2023 was
$84.7 million compared to
$85.3 million recorded in the third
quarter of 2022, a nominal decrease of 0.7%. Net interest
income for the current quarter decreased 2.6% from the $87.0 million reported for the linked
quarter. Average interest-earning assets for the third
quarter of 2023 increased 13.7% from the comparable period of the
prior year, with growth primarily in loans resulting from both
organic growth and the GrandSouth acquisition.
Despite the higher level of earning assets, the market-driven
increases in rates on liabilities, which have occurred at a more
rapid pace than increased yields on assets, resulted in the
reduction in net interest income and net interest margin ("NIM") as
compared to the prior periods.
The Company's tax-equivalent NIM (calculated by dividing
tax-equivalent net interest income by average earning assets)
declined year-over-year with the third quarter of 2023 reporting a
tax-equivalent NIM of 2.97% compared to 3.40% for the third quarter
of 2022. The lower NIM was due to rising market interest
rates driving higher cost of funds which outpaced the increase in
loan yields over the same period. While loan yields rose from
4.49% for the third quarter of 2022 to 5.32% for the current
period, the total cost of funds increased from 0.12% for the third
quarter of 2022 to 1.46% for the quarter ended September 30,
2023. There has been some deceleration of the pace of
increase of the Company's cost of funds; however, it is anticipated
there may continue to be some compression in the NIM given the
percentage of fixed rate loans in the Company's loan portfolio.
|
|
For the Three Months
Ended
|
YIELD
INFORMATION
|
|
September 30,
2023
|
|
June 30,
2023
|
|
September 30,
2022
|
|
|
|
|
|
|
|
Yield on
loans
|
|
5.32 %
|
|
5.26 %
|
|
4.49 %
|
Yield on
securities
|
|
1.75 %
|
|
1.77 %
|
|
1.71 %
|
Yield on other earning
assets
|
|
4.58 %
|
|
4.60 %
|
|
2.27 %
|
Yield on
total interest-earning assets
|
|
4.31 %
|
|
4.25 %
|
|
3.49 %
|
|
|
|
|
|
|
|
Rate on
interest-bearing deposits
|
|
1.95 %
|
|
1.68 %
|
|
0.13 %
|
Rate on other
interest-bearing liabilities
|
|
5.88 %
|
|
5.68 %
|
|
3.99 %
|
Rate on
total interest-bearing liabilities
|
|
2.20 %
|
|
1.96 %
|
|
0.21 %
|
Total cost of
funds
|
|
1.46 %
|
|
1.29 %
|
|
0.12 %
|
|
|
|
|
|
|
|
Net
interest margin (1)
|
|
2.95 %
|
|
3.05 %
|
|
3.38 %
|
Net
interest margin - tax-equivalent (2)
|
|
2.97 %
|
|
3.08 %
|
|
3.40 %
|
Average
prime rate
|
|
8.43 %
|
|
8.16 %
|
|
5.35 %
|
|
|
|
|
|
|
|
|
|
(1) Calculated by
dividing annualized net interest income by average earning assets
for the period.
|
|
(2) Calculated by
dividing annualized tax-equivalent net interest income by average
earning assets for the period. The tax-equivalent
amount reflects the tax benefit that the Company receives related
to its tax-exempt loans and securities, which carry interest rates
lower than similar taxable investments due to their tax-exempt
status. This amount has been computed assuming a 23% tax rate
and is reduced by the related nondeductible portion of interest
expense.
|
Included in interest income for the third quarter of 2023 was
total loan discount accretion of $3.2 million compared to $2.6 million for the third quarter of 2022,
with the increase being primarily related to the GrandSouth
acquisition. Loan discount accretion had an 11 basis points
positive impact on the Company's NIM in the third quarter of 2023
compared to accretion contributing 10 basis points to NIM for the
prior year quarter.
The following table presents the impact to net interest income
of the purchase accounting adjustments for each period.
|
|
For the Three Months
Ended
|
NET INTEREST INCOME
PURCHASE ACCOUNTING ADJUSTMENTS
($ in
thousands)
|
|
September 30,
2023
|
|
June 30,
2023
|
|
September 30,
2022
|
|
|
|
|
|
|
|
Interest income -
increased by accretion of loan discount on acquired
loans
|
|
$
2,766
|
|
3,159
|
|
1,519
|
Interest income -
increased by accretion of loan discount on retained
portions of SBA loans
|
|
437
|
|
426
|
|
1,032
|
Total interest income
impact
|
|
3,203
|
|
3,585
|
|
2,551
|
Interest expense -
(increased) reduced by (discount accretion) premium amortization of
deposits
|
|
(709)
|
|
(878)
|
|
121
|
Interest expense -
increased by discount accretion of borrowings
|
|
(215)
|
|
(212)
|
|
(64)
|
Total net interest
expense impact
|
|
(924)
|
|
(1,090)
|
|
57
|
Total impact on net interest
income
|
|
$
2,279
|
|
2,495
|
|
2,608
|
Provision for Credit Losses and Credit Quality
For the three months ended September 30,
2023 and September 30, 2022, the Company recorded
$1.2 million and $5.1 million in provision for loan losses,
respectively. The provision for the current quarter was
driven by the loan growth experienced during the quarter, combined
with updated prepayment speed estimates which are a key assumption
in the CECL model. The higher interest rate environment has
resulted in slower prepayment speed estimates, thus increasing the
projected allowance for credit losses ("ACL") required. Loss
driver assumptions were also updated with the lower loss rate
estimates resulting in offsetting reductions to the ACL reserve
estimate.
During the third quarter of 2023, the Company recorded a
$1.2 million reversal of the
provision for unfunded commitments, compared to a provision for
unfunded commitments of $0.3 million for the third quarter of 2022.
The current quarter's reversal related primarily to a reduction in
the amount of available lines of credit and the updated loss driver
assumptions reducing the loss rate estimates. The reserve for
unfunded commitments totaled $11.8 million at September 30, 2023 and
is included in the line item "Other Liabilities".
The combination of the above provisions for credit losses and
unfunded commitments resulted in an income statement impact of
$0 for the third quarter of 2023 as
compared to $5.4 million for the
third quarter of 2022.
Asset quality remained strong with annualized net loan
charge-offs of 0.11% for the third quarter of 2023. Total
NPAs amounted to $38.8 million
at September 30, 2023, or 0.32% of total assets, down from
$40.7 million, or 0.39% of total
assets, at September 30, 2022. Nonaccrual loans declined
$3.0 million from the linked quarter,
with the higher number and volume of modifications to borrowers
experiencing financial distress accounting for the increase in
total NPAs during the current quarter.
The following table presents the summary of NPAs and asset
quality ratios for each period.
ASSET QUALITY
DATA
($ in
thousands)
|
|
September 30,
2023
|
|
June 30,
2023
|
|
September 30,
2022
|
|
|
|
|
|
|
|
Nonperforming
assets
|
|
|
|
|
|
|
Nonaccrual
loans
|
|
$
26,884
|
|
29,876
|
|
28,669
|
Modifications to
borrowers in financial distress
|
|
10,723
|
|
4,862
|
|
—
|
Troubled debt
restructurings - accruing (1)
|
|
—
|
|
—
|
|
11,355
|
Total nonperforming
loans
|
|
37,607
|
|
34,738
|
|
40,024
|
Foreclosed real
estate
|
|
1,235
|
|
1,077
|
|
658
|
Total nonperforming
assets
|
|
$
38,842
|
|
35,815
|
|
40,682
|
|
|
|
|
|
|
|
Asset Quality
Ratios
|
|
|
|
|
|
|
Quarterly net
charge-offs to average loans - annualized
|
|
0.11 %
|
|
0.04 %
|
|
0.04 %
|
Nonperforming loans to
total loans
|
|
0.47 %
|
|
0.44 %
|
|
0.61 %
|
Nonperforming assets to
total assets
|
|
0.32 %
|
|
0.30 %
|
|
0.39 %
|
Allowance for credit
losses to total loans
|
|
1.35 %
|
|
1.38 %
|
|
1.33 %
|
|
|
|
|
|
|
|
(1) The Company
implemented ASU 2022-02 effective January 1, 2023 eliminating TDR
accounting.
|
|
Noninterest Income
Total noninterest income for the third quarter of 2023 was
$15.2 million, a 10.3% decrease
from the $16.9 million recorded
for the third quarter of 2022 and a 6.6% increase from the linked
quarter. The primary factors driving fluctuations among the
periods presented were as follows:
- The increase in "Service charges on deposit accounts" between
periods was primarily driven by the higher number of customer
accounts resulting from the GrandSouth acquisition and organic
growth.
- The year-over-year decline in "Other service charges,
commissions and fees" was related to the lower interchange fees
beginning during the third quarter of 2022 as a result of the
Durbin Amendment limitations becoming applicable to the
Company.
- SBA loan sale gains were up from the linked quarter of 2023 and
the comparable quarter of 2022, while year to date results for 2023
continued to lag 2022 due primarily to slower loan originations
earlier in the current year combined with lower premiums available
on SBA loan sales given the current market conditions.
- Other gains for the third quarter and year to date period of
2022 included death benefits realized on bank-owned life insurance
policies. There were no large or unusual transactions in 2023
giving rise to large gains or losses.
Noninterest Expenses
Noninterest expenses amounted to $62.2 million for the third quarter of 2023
compared to $61.6 million for
the linked quarter and $48.7 million for the third quarter of
2022.
The 27.8% increase in total noninterest expenses from the prior
year period was primarily driven by increased compensation expense
of $7.4 million, or 25.8%, and other
facilities-related and support costs associated with the
acquisition of eight GrandSouth branch locations and related branch
and support personnel. Intangible amortization increased
$1.1 million (119.7%) from the third
quarter of 2022 to the third quarter of 2023 as a direct result of
the core deposit intangibles added with the GrandSouth
acquisition. Other operating expenses increased $5.5 million (39.7%) from the third quarter of
2022 driven by: (1) increases in data processing and software
expense for the additional transaction and account volumes and
investments in new software systems; (2) FDIC insurance increases
related to the deposits acquired from GrandSouth and the general
FDIC rate increase effective January 1,
2023; and (3) higher check fraud and other
non-credit losses experienced to date in 2023.
Balance Sheet
Total assets at September 30, 2023
amounted to $12.0 billion, down
$55.0 million from the linked quarter
and growing 13.9% from a year earlier. The decrease from the
linked quarter was primarily related to lower cash and borrowing
balances from normal balance sheet fluctuations. Increases in
loans during the quarter were essentially offset by lower balances
of investment securities. The growth from a year earlier was
driven by the acquisition of GrandSouth, combined with organic loan
and deposit growth during the period.
Quarterly average balances for key balance sheet accounts are
presented below.
|
|
For the Three Months
Ended
|
AVERAGE
BALANCES
($ in
thousands)
|
|
September 30,
2023
|
|
December 31,
2022
|
|
September 30,
2022
|
|
Change
3Q23 vs 3Q22
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$ 12,005,778
|
|
10,579,187
|
|
10,567,133
|
|
13.6 %
|
Investment securities,
at amortized cost
|
|
3,180,845
|
|
3,325,652
|
|
3,378,383
|
|
(5.8) %
|
Loans
|
|
7,939,783
|
|
6,576,415
|
|
6,389,996
|
|
24.3 %
|
Earning
assets
|
|
11,405,306
|
|
10,161,108
|
|
10,028,388
|
|
13.7 %
|
Deposits
|
|
10,180,046
|
|
9,275,909
|
|
9,299,278
|
|
9.5 %
|
Interest-bearing
liabilities
|
|
7,071,407
|
|
5,779,958
|
|
5,661,339
|
|
24.9 %
|
Shareholders'
equity
|
|
1,303,249
|
|
1,003,031
|
|
1,087,763
|
|
19.8 %
|
Total investment securities were $2.6 billion at September 30, 2023, a
decrease of $121.7 million from
the linked quarter and $246.5 million
from September 30, 2022. The investment securities
portfolio continues to decline as cash flows from amortizing
investments are utilized to fund loan growth and fluctuations in
deposits. The unrealized loss on available for sale
securities totaled $521.7 million at
September 30, 2023, representing an increase of $81.5 million from the linked quarter and
$77.6 million from year end.
The Company has the intent to hold, and will not be required to
sell, investments with unrealized losses until maturity or recovery
of the amortized cost as market conditions change.
Total loans amounted to $8.0 billion at September 30, 2023, an
increase of $129.4 million from the
linked quarter and $1.5 billion, or
23.0%, from September 30, 2022. Excluding the GrandSouth
acquisition, organic loan growth was $341.8 million for 2023 year to date,
representing an annualized growth rate of 5.9%.
As presented below, our total loan portfolio mix has remained
consistent. There were no notable concentrations in
geographies or industries, including in office or hospitality
categories. The Company's exposure to non-owner occupied
office loans represented approximately 5.8% of the total portfolio
at September 30, 2023, and the average size of these loans was
$1.4 million. Non-owner
occupied office loans are generally in non-metro markets and the
top 10 loans in this category represent less than 2% of the total
loan portfolio.
The following table presents the balance and portfolio
percentage by loan category for each period.
|
|
September 30,
2023
|
|
June 30,
2023
|
|
September 30,
2022
|
($ in
thousands)
|
|
Amount
|
|
Percentage
|
|
Amount
|
|
Percentage
|
|
Amount
|
|
Percentage
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
|
$ 893,910
|
|
11 %
|
|
888,391
|
|
11 %
|
|
617,538
|
|
10 %
|
Construction,
development & other land loans
|
|
1,008,289
|
|
13 %
|
|
1,109,769
|
|
14 %
|
|
919,236
|
|
14 %
|
Commercial real estate
- owner occupied
|
|
1,252,259
|
|
16 %
|
|
1,222,189
|
|
16 %
|
|
1,038,877
|
|
16 %
|
Commercial real estate
- non-owner occupied
|
|
2,509,317
|
|
31 %
|
|
2,423,262
|
|
31 %
|
|
2,095,283
|
|
32 %
|
Multi-family real
estate
|
|
405,161
|
|
5 %
|
|
392,120
|
|
5 %
|
|
339,065
|
|
5 %
|
Residential 1-4 family
real estate
|
|
1,560,140
|
|
19 %
|
|
1,461,068
|
|
18 %
|
|
1,132,552
|
|
17 %
|
Home equity loans/lines
of credit
|
|
331,108
|
|
4 %
|
|
334,566
|
|
4 %
|
|
323,218
|
|
5 %
|
Consumer
loans
|
|
67,169
|
|
1 %
|
|
67,077
|
|
1 %
|
|
60,651
|
|
1 %
|
Loans,
gross
|
|
8,027,353
|
|
100 %
|
|
7,898,442
|
|
100 %
|
|
6,526,420
|
|
100 %
|
Unamortized net
deferred loan fees
|
|
(316)
|
|
|
|
(813)
|
|
|
|
(1,134)
|
|
|
Total loans
|
|
$
8,027,037
|
|
|
|
7,897,629
|
|
|
|
6,525,286
|
|
|
Total deposits amounted to $10.2 billion at September 30, 2023, an
increase of $1.0 billion, or
10.9%, from September 30, 2022, primarily driven by the
GrandSouth acquisition. Organic market deposit growth
(excluding the acquired deposits and brokered deposits) was
$66.7 million for the third
quarter of 2023 and $220.7 million since year end. Quarterly
organic market growth represents an annualized growth rate of
3.0%.
The Company has a diversified and granular deposit base which
has remained stable with continued growth in core deposits,
primarily noninterest-bearing checking accounts and money market
accounts. At quarter end, noninterest-bearing deposits
accounted for 34% of total deposits, down slightly from 36% in the
linked quarter. As of September 30, 2023, the estimated
insured deposits totaled $6.4 billion
or 63.0% of total deposits. In addition, there were
collateralized deposits at that date of $804.6 million such that approximately 70.9% of
our total deposits were insured or collateralized at the current
quarter end.
Our deposit mix has remained consistent historically and has not
significantly changed with the addition of GrandSouth as presented
in the table below.
|
|
September 30,
2023
|
|
June 30,
2023
|
|
September 30,
2022
|
($ in
thousands)
|
|
Amount
|
|
Percentage
|
|
Amount
|
|
Percentage
|
|
Amount
|
|
Percentage
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
checking accounts
|
|
$
3,503,050
|
|
34 %
|
|
3,639,930
|
|
36 %
|
|
3,748,207
|
|
41 %
|
Interest-bearing
checking accounts
|
|
1,458,855
|
|
14 %
|
|
1,454,489
|
|
14 %
|
|
1,551,450
|
|
17 %
|
Money market
accounts
|
|
3,635,523
|
|
36 %
|
|
3,411,072
|
|
34 %
|
|
2,432,926
|
|
26 %
|
Savings
accounts
|
|
638,912
|
|
6 %
|
|
658,473
|
|
6 %
|
|
751,895
|
|
8 %
|
Other time
deposits
|
|
626,870
|
|
6 %
|
|
638,751
|
|
6 %
|
|
485,738
|
|
5 %
|
Time deposits
>$250,000
|
|
359,704
|
|
4 %
|
|
353,473
|
|
4 %
|
|
259,055
|
|
3 %
|
Total market
deposits
|
|
10,222,914
|
|
100 %
|
|
10,156,188
|
|
100 %
|
|
9,229,271
|
|
100 %
|
Brokered
deposits
|
|
12,489
|
|
— %
|
|
12,381
|
|
— %
|
|
—
|
|
— %
|
Total
deposits
|
|
$ 10,235,403
|
|
100 %
|
|
10,168,569
|
|
100 %
|
|
9,229,271
|
|
100 %
|
Capital
The Company remains well-capitalized by all regulatory
standards, with an estimated total risk-based capital ratio at
September 30, 2023 of 15.26%, up from the linked quarter ratio
of 15.09% and the 14.84% ratio reported at September 30,
2022.
The Company has elected to exclude accumulated other
comprehensive income ("AOCI") related primarily to available for
sale securities from common equity tier 1 capital. AOCI is
included in the Company's tangible common equity to tangible assets
ratio ("TCE") which was 6.49% at September
30, 2023, a decrease of 30 basis points from the linked
quarter and an increase of 51 basis points from the prior year
period. The decrease in TCE for the current quarter was
driven by changes in AOCI, partially offset by earnings. As
discussed above, the AOCI balance deteriorated relative to the
increase in unrealized loss on available for sale securities as of
September 30, 2023.
CAPITAL
RATIOS
|
|
September 30,
2023
(estimated)
|
|
June 30,
2023
|
|
September 30,
2022
|
|
|
|
|
|
|
|
Tangible common equity
to tangible assets (non-GAAP)
|
|
6.49 %
|
|
6.79 %
|
|
5.98 %
|
Common equity tier I
capital ratio
|
|
12.93 %
|
|
12.75 %
|
|
12.76 %
|
Tier I leverage
ratio
|
|
10.72 %
|
|
10.47 %
|
|
10.21 %
|
Tier I risk-based
capital ratio
|
|
13.71 %
|
|
13.54 %
|
|
13.59 %
|
Total risk-based
capital ratio
|
|
15.26 %
|
|
15.09 %
|
|
14.84 %
|
Liquidity
Liquidity is evaluated as both on-balance sheet (primarily cash
and cash-equivalents, unpledged securities, and other marketable
assets) and off-balance sheet (readily available lines of credit or
other funding sources). The Company continues to manage
liquidity sources, including unused lines of credit, at levels
believed to be adequate to meet its operating needs for the
foreseeable future.
The Company's on-balance sheet liquidity ratio (net liquid
assets as a percent of net liabilities) at September 30, 2023
was 14.4%. In addition, the Company had approximately
$2.2 billion in available lines of
credit at that date resulting in a total liquidity ratio of
30.2%. The increase of $462,000
in available lines during the third quarter of 2023 was a result of
additional loan collateral being transferred to the FHLB to enhance
the levels of off-balance sheet liquidity availability to meet
demands, as necessary.
First Bancorp is a bank holding company headquartered in
Southern Pines, North Carolina,
with total assets of $12.0 billion. Its principal activity is the
ownership and operation of First Bank, a state-chartered community
bank that operates 118 branches in North
Carolina and South Carolina. First Bank also provides
SBA loans to customers through its nationwide network of lenders -
for more information on First Bank's SBA lending capabilities,
please visit www.firstbanksba.com. First Bancorp's common
stock is traded on The NASDAQ Global Select Market under the symbol
"FBNC."
Please visit our website at www.LocalFirstBank.com.
Caution about Forward-Looking Statements: This press release
contains forward-looking statements within the meaning of Section
21E of the Securities Exchange Act of 1934 and the Private
Securities Litigation Reform Act of 1995, which statements are
inherently subject to risks and uncertainties.
Forward-looking statements are statements that include projections,
predictions, expectations or beliefs about future events or results
or otherwise are not statements of historical fact. Such
statements are often characterized by the use of qualifying words
(and their derivatives) such as "expect," "believe," "estimate,"
"plan," "project," "anticipate," or other words or phrases
concerning opinions or judgments of the Company and its management
about future events. Factors that could influence the
accuracy of such forward-looking statements include, but are not
limited to, the financial success or changing strategies of the
Company's customers, the Company's level of success in integrating
acquisitions, actions of government regulators, the level of market
interest rates, and general economic conditions. For
additional information about the factors that could affect the
matters discussed in this paragraph, see the "Risk Factors" section
of the Company's most recent Annual Report on Form 10-K available
at www.sec.gov. Forward-looking statements speak only as of
the date they are made, and the Company undertakes no obligation to
update or revise forward-looking statements. The Company is
also not responsible for changes made to this press release by wire
services, internet services or other media.
First Bancorp and
Subsidiaries
Financial
Summary
|
|
CONSOLIDATED INCOME
STATEMENT
($ in thousands,
except per share data)
|
|
|
|
For the Three Months
Ended
|
|
For the Nine Months
Ended
|
|
|
September 30,
2023
|
|
June 30,
2023
|
|
September 30,
2022
|
|
September 30,
2023
|
|
September 30,
2022
|
Interest
income
|
|
|
|
|
|
|
|
|
|
|
Interest
and fees on loans
|
|
$
106,514
|
|
102,963
|
|
72,239
|
|
308,857
|
|
201,518
|
Interest
on investment securities
|
|
14,054
|
|
14,183
|
|
14,565
|
|
42,783
|
|
43,312
|
Other
interest income
|
|
3,283
|
|
4,015
|
|
1,486
|
|
10,546
|
|
3,016
|
Total interest
income
|
|
123,851
|
|
121,161
|
|
88,290
|
|
362,186
|
|
247,846
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
Interest
on deposits
|
|
32,641
|
|
27,328
|
|
1,848
|
|
78,887
|
|
5,204
|
Interest
on borrowings
|
|
6,508
|
|
6,848
|
|
1,108
|
|
19,125
|
|
2,160
|
Total interest
expense
|
|
39,149
|
|
34,176
|
|
2,956
|
|
98,012
|
|
7,364
|
Net
interest income
|
|
84,702
|
|
86,985
|
|
85,334
|
|
264,174
|
|
240,482
|
Provision for loan
losses
|
|
1,200
|
|
3,700
|
|
5,100
|
|
16,351
|
|
8,600
|
(Reversal of) provision
for unfunded commitments
|
|
(1,200)
|
|
(1,339)
|
|
300
|
|
(1,487)
|
|
(1,200)
|
Total provision for credit
losses
|
|
—
|
|
2,361
|
|
5,400
|
|
14,864
|
|
7,400
|
Net
interest income after provision for credit losses
|
|
84,702
|
|
84,624
|
|
79,934
|
|
249,310
|
|
233,082
|
Noninterest
income
|
|
|
|
|
|
|
|
|
|
|
Service
charges on deposit accounts
|
|
4,661
|
|
4,114
|
|
4,166
|
|
13,012
|
|
11,407
|
Other
service charges, commissions, and fees
|
|
5,450
|
|
5,650
|
|
6,312
|
|
16,677
|
|
21,200
|
Fees from
presold mortgage loans
|
|
325
|
|
557
|
|
376
|
|
1,288
|
|
1,951
|
Commissions from sales of financial products
|
|
1,207
|
|
1,413
|
|
1,391
|
|
3,926
|
|
3,487
|
SBA
consulting fees
|
|
478
|
|
409
|
|
479
|
|
1,408
|
|
1,963
|
SBA loan
sale gains
|
|
1,101
|
|
696
|
|
479
|
|
2,052
|
|
4,581
|
Bank-owned
life insurance income
|
|
1,104
|
|
1,066
|
|
962
|
|
3,216
|
|
2,880
|
Other
gains, net
|
|
851
|
|
330
|
|
2,747
|
|
1,369
|
|
5,958
|
Total noninterest
income
|
|
15,177
|
|
14,235
|
|
16,912
|
|
42,948
|
|
53,427
|
Noninterest
expenses
|
|
|
|
|
|
|
|
|
|
|
Salaries
expense
|
|
29,394
|
|
28,676
|
|
24,416
|
|
87,391
|
|
71,669
|
Employee
benefit expense
|
|
6,539
|
|
6,165
|
|
4,156
|
|
19,097
|
|
16,044
|
Occupancy
and equipment related expense
|
|
5,003
|
|
4,972
|
|
4,847
|
|
15,042
|
|
14,171
|
Merger and
acquisition expenses
|
|
—
|
|
1,334
|
|
548
|
|
13,506
|
|
4,769
|
Intangibles amortization expense
|
|
1,953
|
|
2,049
|
|
889
|
|
6,147
|
|
2,859
|
Other
operating expenses
|
|
19,335
|
|
18,397
|
|
13,844
|
|
56,809
|
|
40,051
|
Total noninterest
expenses
|
|
62,224
|
|
61,593
|
|
48,700
|
|
197,992
|
|
149,563
|
Income before income
taxes
|
|
37,655
|
|
37,266
|
|
48,146
|
|
94,266
|
|
136,946
|
Income tax
expense
|
|
7,762
|
|
7,863
|
|
10,197
|
|
19,809
|
|
28,443
|
Net income
|
|
$
29,893
|
|
29,403
|
|
37,949
|
|
74,457
|
|
108,503
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share - diluted
|
|
$
0.73
|
|
0.71
|
|
1.06
|
|
1.81
|
|
3.04
|
First Bancorp and
Subsidiaries
Financial
Summary
|
|
CONSOLIDATED BALANCE
SHEETS
($ in
thousands)
|
|
|
|
At September 30,
2023
|
|
At June 30,
2023
|
|
At December 31,
2022
|
|
At September 30,
2022
|
Assets
|
|
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
95,257
|
|
101,215
|
|
101,133
|
|
83,050
|
Interest-bearing
deposits with banks
|
|
178,332
|
|
259,460
|
|
169,185
|
|
186,465
|
Total cash and cash
equivalents
|
|
273,589
|
|
360,675
|
|
270,318
|
|
269,515
|
|
|
|
|
|
|
|
|
|
Investment
securities
|
|
2,635,866
|
|
2,757,607
|
|
2,856,193
|
|
2,882,408
|
Presold mortgages and
SBA loans held for sale
|
|
8,060
|
|
4,953
|
|
1,282
|
|
3,710
|
|
|
|
|
|
|
|
|
|
Loans
|
|
8,027,037
|
|
7,897,629
|
|
6,665,145
|
|
6,525,286
|
Allowance for credit
losses on loans
|
|
(108,198)
|
|
(109,230)
|
|
(90,967)
|
|
(86,587)
|
Net loans
|
|
7,918,839
|
|
7,788,399
|
|
6,574,178
|
|
6,438,699
|
|
|
|
|
|
|
|
|
|
Premises and
equipment
|
|
151,981
|
|
152,443
|
|
134,187
|
|
134,288
|
Operating right-of-use
lease assets
|
|
17,604
|
|
18,375
|
|
18,733
|
|
19,230
|
Intangible
assets
|
|
513,629
|
|
515,847
|
|
376,938
|
|
378,150
|
Bank-owned life
insurance
|
|
182,764
|
|
181,659
|
|
164,592
|
|
164,793
|
Other assets
|
|
275,628
|
|
253,040
|
|
228,628
|
|
225,069
|
Total assets
|
|
$ 11,977,960
|
|
12,032,998
|
|
10,625,049
|
|
10,515,862
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
Noninterest-bearing checking
accounts
|
|
$
3,503,050
|
|
3,639,930
|
|
3,566,003
|
|
3,748,207
|
Interest-bearing deposit
accounts
|
|
6,732,353
|
|
6,528,639
|
|
5,661,526
|
|
5,481,064
|
Total deposits
|
|
10,235,403
|
|
10,168,569
|
|
9,227,529
|
|
9,229,271
|
|
|
|
|
|
|
|
|
|
Borrowings
|
|
401,843
|
|
481,658
|
|
287,507
|
|
226,476
|
Operating lease
liabilities
|
|
18,348
|
|
19,109
|
|
19,391
|
|
19,847
|
Other
liabilities
|
|
64,683
|
|
66,020
|
|
59,026
|
|
55,771
|
Total liabilities
|
|
10,720,277
|
|
10,735,356
|
|
9,593,453
|
|
9,531,365
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
|
|
Common stock
|
|
962,644
|
|
960,851
|
|
725,153
|
|
724,694
|
Retained
earnings
|
|
695,791
|
|
674,933
|
|
648,418
|
|
617,839
|
Stock in rabbi trust
assumed in acquisition
|
|
(1,375)
|
|
(1,365)
|
|
(1,585)
|
|
(1,585)
|
Rabbi trust
obligation
|
|
1,375
|
|
1,365
|
|
1,585
|
|
1,585
|
Accumulated other
comprehensive loss
|
|
(400,752)
|
|
(338,142)
|
|
(341,975)
|
|
(358,036)
|
Total shareholders'
equity
|
|
1,257,683
|
|
1,297,642
|
|
1,031,596
|
|
984,497
|
Total liabilities and
shareholders' equity
|
|
$ 11,977,960
|
|
12,032,998
|
|
10,625,049
|
|
10,515,862
|
First Bancorp and
Subsidiaries
Financial
Summary
|
|
TREND
INFORMATION
|
|
|
|
For the Three Months
Ended
|
|
|
September 30,
2023
|
|
June 30,
2023
|
|
March 31,
2023
|
|
December 31,
2022
|
|
September 30,
2022
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE
RATIOS (annualized)
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (1)
|
|
0.99 %
|
|
0.98 %
|
|
0.51 %
|
|
1.44 %
|
|
1.42 %
|
Return on average
common equity (2)
|
|
9.10 %
|
|
8.97 %
|
|
4.83 %
|
|
15.20 %
|
|
13.84 %
|
Return on average
tangible common equity (3)
|
|
15.05 %
|
|
14.79 %
|
|
8.16 %
|
|
20.96 %
|
|
21.25 %
|
|
|
|
|
|
|
|
|
|
|
|
COMMON SHARE
DATA
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared
- common
|
|
$
0.22
|
|
0.22
|
|
0.22
|
|
0.22
|
|
0.22
|
Stated book value -
common
|
|
$
30.61
|
|
31.59
|
|
31.72
|
|
28.89
|
|
27.57
|
Tangible book value -
common (non-GAAP)
|
|
$
18.11
|
|
19.03
|
|
19.08
|
|
18.34
|
|
16.98
|
Common shares
outstanding at end of period
|
|
41,085,498
|
|
41,082,678
|
|
40,986,990
|
|
35,704,154
|
|
35,711,754
|
Weighted average shares
outstanding - diluted
|
|
41,199,058
|
|
41,129,100
|
|
41,112,692
|
|
35,614,972
|
|
35,703,446
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL INFORMATION
(estimates for current quarter)
|
|
|
|
|
|
|
|
|
|
|
Tangible common equity
to tangible assets
|
|
6.49 %
|
|
6.79 %
|
|
6.60 %
|
|
6.39 %
|
|
5.98 %
|
Common equity tier I
capital ratio
|
|
12.93 %
|
|
12.75 %
|
|
12.53 %
|
|
13.02 %
|
|
12.76 %
|
Total risk-based
capital ratio
|
|
15.26 %
|
|
15.09 %
|
|
14.88 %
|
|
15.09 %
|
|
14.84 %
|
|
|
|
|
|
|
|
|
|
|
|
(1) Calculated by
dividing annualized net income by average assets.
|
(2) Calculated by
dividing annualized net income by average common equity.
|
(3) Calculated by
dividing annualized net income by average tangible common
equity.
|
|
|
For the Three Months
Ended
|
INCOME
STATEMENT
($ in thousands
except per share data)
|
|
September 30,
2023
|
|
June 30,
2023
|
|
March 31,
2023
|
|
December 31,
2022
|
|
September 30,
2022
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income -
tax-equivalent (1)
|
|
$
85,442
|
|
87,684
|
|
93,186
|
|
85,094
|
|
86,026
|
Taxable equivalent
adjustment (1)
|
|
740
|
|
699
|
|
700
|
|
722
|
|
692
|
Net interest
income
|
|
84,702
|
|
86,985
|
|
92,486
|
|
84,372
|
|
85,334
|
Provision for loan
losses
|
|
1,200
|
|
3,700
|
|
11,451
|
|
4,000
|
|
5,100
|
(Reversal of) provision
for unfunded commitments
|
|
(1,200)
|
|
(1,339)
|
|
1,051
|
|
1,000
|
|
300
|
Noninterest
income
|
|
15,177
|
|
14,235
|
|
13,536
|
|
14,558
|
|
16,912
|
Merger and acquisition
costs
|
|
—
|
|
1,334
|
|
12,182
|
|
303
|
|
548
|
Other noninterest
expense
|
|
62,224
|
|
60,259
|
|
61,993
|
|
45,354
|
|
48,152
|
Income before income
taxes
|
|
37,655
|
|
37,266
|
|
19,345
|
|
48,273
|
|
48,146
|
Income tax
expense
|
|
7,762
|
|
7,863
|
|
4,184
|
|
9,840
|
|
10,197
|
Net income
|
|
29,893
|
|
29,403
|
|
15,161
|
|
38,433
|
|
37,949
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share - diluted
|
|
$
0.73
|
|
0.71
|
|
0.37
|
|
1.08
|
|
1.06
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) This amount
reflects the tax benefit that the Company receives related to its
tax-exempt loans and securities, which carry interest rates lower
than similar taxable investments due to their tax-exempt
status. This amount has been computed assuming a 23% tax rate
and is reduced by the related nondeductible portion of interest
expense.
|
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SOURCE First Bancorp