Independent Bank Group, Inc. (Nasdaq:IBTX), the holding company for
Independent Bank, today announced net income of $5.9 million, or
$0.49 per diluted share, for the quarter ended June 30, 2013
compared to pro forma after tax net income of $3.8 million, or
$0.46 per diluted share, for the quarter ended March 31, 2013 and
$2.6 million, or $0.33 per diluted share, for the quarter ended
June 30, 2012. Prior to April 1, 2013 and the initial public
offering, the Company was an S corporation and did not incur
federal income tax expense. As a result, pro forma adjustments have
been provided for comparability.
Independent Bank Group Chairman and Chief Executive Officer
David R. Brooks said, "We are very pleased with our results for the
second quarter. Loans and deposits have continued to grow and
earnings have remained strong. We continue to execute on our plan
in a very competitive environment."
Highlights:
- On a core pre-tax, pre-provision earnings basis, second quarter
2013 net income was $7.2 million compared to $6.5 million for first
quarter 2013 and compared to $5.3 million for second quarter
2012.
- Loans held for investment grew at an annual rate of 27.2% in
the second quarter and 21.0% for the first six months of 2013.
- Continued strong asset quality, as reflected by nonperforming
assets to total assets ratio of 1.27%, a nonperforming loans to
total loans ratio of 0.43%, and an annualized net charge-offs to
average loans ratio of 0.08% at June 30, 2013.
- On a core basis, net interest income was $18.0 million for the
second quarter 2013 compared to $17.1 million for the first quarter
2013 and $14.3 million for the second quarter 2012.
- The efficiency ratio improved to 65.0% compared to 67.5% for
first quarter 2013 and 72.8% for second quarter 2012.
- On July 19, 2013, the Company announced the acquisition of
Collin Bank, a commercial bank located on the Dallas North Tollway
in Collin County with total assets of $204.1 million as of March
31, 2013.
Second Quarter 2013 Results:
Earnings Remain Solid
Earnings continued to be strong during the quarter due to strong
loan growth and continuing improvement in the efficiency ratio. Mr.
Brooks noted, "The significant increase in interest-earning assets,
fueled by our loan growth, enabled us to absorb compression in our
net interest margin and report very solid earnings for the second
quarter."
Net Interest Income
- Net interest income was $17.9 million for second quarter 2013
compared to $18.2 million for first quarter 2013 and $14.3 million
for second quarter 2012. Excluding recognition of income from the
repayment of acquired loans and a $223,000 write-off of unamortized
debt origination costs related to previously issued warrants, the
amounts were $18.0 million, $17.1 million and $14.3 million,
respectively.
- Net interest margin was 4.16% for second quarter 2013 compared
to 4.68% for first quarter 2013 and 4.38% for second quarter 2012.
Excluding recognition of income from the repayment of acquired
loans and the write-off of unamortized debt origination costs
related to previously issued warrants, the net interest margin was
4.20% for second quarter 2013 compared to 4.40% for first quarter
2013 and 4.38% for second quarter 2012.
- The yield on interest-earning assets was 4.92% for second
quarter 2013 compared to 5.50% for first quarter 2013 and 5.43% for
second quarter 2012. The earning assets yield was affected by the
investment of the proceeds of the initial public offering in lower
yielding assets pending deployment for acquisitions. The yield was
also affected by a 14 basis point decline in loan yields,
reflecting the competitive nature of our markets and a 31 basis
point decline in acquired loan accretion in the second
quarter.
- The average balance of total interest-earning assets grew by
$141.2 million, or 8.9% (35.9% on an annualized basis), from the
end of first quarter 2013 and totaled $1.721 billion compared to
$1.579 billion at March 31, 2013 and compared to $1.313 billion at
June 30, 2012. The second quarter increase in average
interest-earning assets is due to a $98.4 million increase in loans
and $67.7 million in retained proceeds from the initial public
offering after the repayment of $19.1 million of indebtedness. The
year over year increase in interest-earning assets is due, in part,
to the acquisition completed in the fourth quarter of 2012 as well
as the retained proceeds from the initial public offering.
Noninterest Income
- Total noninterest income increased $306 thousand compared to
first quarter 2013 and increased $1.1 million compared to second
quarter 2012.
- The increase in noninterest income compared to first quarter
2013 is the result of a $71 thousand increase in service charges
collected on deposit accounts, a $31 thousand increase in mortgage
fee income and a $148 thousand gain recognized on the sale of other
real estate in the second quarter compared to only a $25 thousand
gain in the first quarter.
- The increase in noninterest income compared to second quarter
2012 reflects an increase of $372 thousand in deposit service fees,
a $203 thousand increase in mortgage fee income, and the $148
thousand gain recognized on the sale of other real estate. In
addition, there was a $346 thousand loss on the sale of premises
and equipment in the second quarter of 2012 compared to only a $2
thousand loss on premises and equipment in the second quarter of
2013.
Noninterest Expense
- Total noninterest expense decreased $539 thousand compared to
first quarter 2013 and increased $1.8 million compared to second
quarter 2012.
- The decrease in noninterest expense compared to first quarter
2013 is due to a reimbursement of the FDIC prepaid assessment,
resulting in a reduction of FDIC insurance expense for the quarter
and year to date. In addition, other real estate impairment was
only $15 thousand compared to $448 thousand in the first quarter
2013. These reductions in expense were partially offset by
increases in salary, occupancy and other expenses during the second
quarter 2013 compared to the previous linked quarter.
- The increase in noninterest expense compared to the prior year
period is primarily related to increases in compensation and
occupancy expenses resulting from the acquisition completed in
October 2012, the hiring of new lending teams and the opening of
the Dallas and Austin branches.
Provision for Loan Losses
- Provision for loan loss expense was $1.079 million for the
quarter, an increase of $49 thousand compared to $1.030 million for
first quarter 2013 and an increase of $412 thousand compared to
$667 thousand during second quarter 2012. This increase was to
properly reserve for the growth in the loan portfolio during the
quarter.
- The allowance for loan losses was $12.8 million, or 198.14% and
0.84% of nonperforming loans and total loans, respectively, at June
30, 2013, compared to $12.0 million, or 209.73% and 0.85% of
nonperforming loans and total loans, respectively, at March 31,
2013, and compared to $9.9 million, or 103.63% and 0.84% of
nonperforming loans and total loans, respectively, at June 30,
2012.
Income Taxes
- The Company became a C corporation on April 1, 2013 and its
results of operations now include federal income tax expense.
Federal tax expense of $2.0 million was recorded for the quarter
ended June 30, 2013, an effective rate of 32.8%. If the Company had
been a C corporation in the first quarter 2013 and the second
quarter of 2012, we estimate that our effective tax rate for those
quarters would have been 32.8% and 30.1%, respectively.
- In connection with the change in tax status on April 1, 2013,
the Company recorded a deferred tax asset as of that date which
resulted in a one time credit to federal income tax expense of $1.8
million. On a pro forma basis, after tax net income would have been
$4.1 million for the quarter ended June 30, 2013 compared to pro
forma after tax net income of $3.8 million for the quarter ended
March 31, 2013 and $2.6 million for the quarter ended June 30, 2012
had the Company not recorded this credit.
Second Quarter 2013 Balance Sheet
Highlights
Continued Growth
The Company's underlying organic growth continued during the
quarter and for the year. Overall asset quality remains strong and
the Company remains well capitalized. Mr. Brooks stated, "We are
beginning to recognize significant organic loan growth resulting
from the addition of new lending teams associated with our Dallas
and Austin locations." Brooks continued, "Credit quality continues
to be the foundation of our Company with all metrics remaining at
historically low levels." Loans
- Total loans held for investment were $1.512 billion at June 30,
2013 compared to $1.416 billion at March 31, 2013 and compared to
$1.180 billion at June 30, 2012. This represented a 6.8% increase
(27.2% on an annualized basis) since the previous quarter end and a
28.2% increase since June 30, 2012.
- Since June 30, 2012, loan growth has been centered in
commercial real estate loans ($190 million), C&I loans ($82
million), and residential real estate loans ($43 million).
- Continued focus on commercial lending increased the C&I
portfolio from $169.9 million (12.3% of total loans) at December
31, 2012 to $200.8 million (13.2% of total loans) at June 30,
2013.
Asset Quality
- Total nonperforming assets remained low and stable at $24.3
million, or 1.27% of total assets at June 30, 2013, compared to
$23.9 million, or 1.35% of total assets at March 31, 2013 and
compared to $34.0 million, or 2.30% of total assets at June 30,
2012.
- Total nonperforming loans increased slightly to $6.4 million,
or 0.43% of total loans at June 30, 2013, compared to $5.7 million,
or 0.40% of total loans at March 31, 2013, and compared to $9.5
million, or 0.81% of total loans at June 30, 2012.
Deposits and Borrowings
- Total deposits were $1.485 billion at June 30, 2013 compared to
$1.415 billion at March 31, 2013 and compared to $1.202 billion at
June 30, 2012.
- The average cost of interest bearing deposits declined by three
basis points during the second quarter to 0.58% compared to 0.61%
during first quarter 2013 and by 28 basis points compared to 0.86%
during the second quarter 2012.
- Total borrowings (other than junior subordinated debentures)
were $181.1 million at June 30, 2013, a decrease of $19.1 million
from March 31, 2013 and an increase of $35.7 million from June 30,
2012.
- Total borrowings declined during the second quarter 2013 due to
the repayment of senior debt of $11.6 million, Adriatica debt of
$3.5 million and subordinated debt of $4.0 million in April 2013.
The unamortized debt origination costs of $223 thousand associated
with warrants issued in 2009 related to the subordinated debt
repaid and were fully expensed during the second quarter.
Capital
- The tangible common equity to tangible assets and the Tier 1
capital to average assets ratios were 9.74% and 10.91%,
respectively, at June 30, 2013 compared to 5.33% and 6.29%,
respectively, at March 31, 2013 and 5.68% and 6.91%, respectively,
at June 30, 2012. The total stockholders' equity to total assets
ratio was 11.24%, 7.04%, 7.45% at June 30, 2013, March 31, 2013 and
June 30, 2012, respectively. The increase in capital ratios was due
primarily to the capital received from the initial public
offering.
- Book value and tangible book value per common share were $17.75
and $15.13, respectively, at June 30, 2013 compared to $15.01 and
$11.16, respectively, at March 31, 2013 and $14.02 and $10.50,
respectively, at June 30, 2012.
- Return on average assets and return on average equity (on an
annualized basis) were 1.25% and 11.11%, respectively, for second
quarter 2013 compared to pro forma after tax returns of 0.89% and
12.43%, respectively, for first quarter 2013 and 0.69% and 9.52%,
respectively, for second quarter 2012. On a core pre-tax,
pre-provision earnings basis, return on average assets and return
on average equity (on an annualized basis) were 1.55% and 13.70%,
respectively, for second quarter 2013 compared to 1.52% and 21.14%,
respectively, for first quarter 2013 and 1.44% and 19.83%,
respectively, for second quarter 2012.
Collin Bank Acquisition
On July 19, 2013, the Company announced the execution of a
definitive agreement to acquire Collin Bank, Plano, Texas ("Collin
Bank"), a Texas state chartered bank with total assets of $204.1
million, total deposits of $161.9 million, and total equity capital
of $25.8 million as of March 31, 2013. Collin Bank is a full
service commercial bank with one office located on the Dallas North
Tollway.
Mr. Brooks stated "We are pleased to announce the first
acquisition following our initial public offering. Acquisitions
within our existing markets are a component of our growth strategy
and this one adds to our presence in Collin County, one of the most
affluent counties in Texas. Collin Bank has a proven record of loan
growth with a good deposit base. Additionally, the acquisition will
provide us with a prominent location on the Dallas North Tollway,
which will allow us to consolidate our current Plano office and
lending team with the Collin Bank location serving as a stronger
platform to grow additional loans and deposits in the Dallas/North
Texas Region."
- Under the terms of the definitive agreement, Collin Bank
shareholders will receive approximately $10.00 per share for each
outstanding share of Collin Bank common stock. Approximately 65% of
the consideration is payable in cash and 35% is payable in shares
of Company common stock, subject to a maximum issuance of 300,000
shares and other related adjustments, with the exchange ratio set
three days prior to the closing by utilizing the average share
price of Company common stock over a twenty day trading
period.
- Based on the number of shares of Collin Bank stock outstanding,
the amount of total consideration to be paid by the Company is
currently valued at approximately $29.1 million. The acquisition is
expected to be accretive to earnings per share immediately and
slightly accretive to tangible book value at closing.
- The merger has been approved by the Boards of Directors of both
companies and is expected to close during the fourth quarter of
2013, although delays may occur. The transaction is subject to
certain conditions, including the approval by Collin Bank's
shareholders and customary regulatory approvals. Operational
integration is anticipated to begin during the first quarter of
2014.
About Independent Bank Group
Independent Bank Group, through its wholly owned subsidiary,
Independent Bank, provides a wide range of relationship-driven
commercial banking products and services tailored to meet the needs
of businesses, professionals and individuals. Independent Bank
Group operates 29 banking offices in 26 communities in two market
regions located in the Dallas/Fort Worth metropolitan area and the
greater Austin area. As of June 30, 2013, Independent Bank Group
had total assets of $1.906 billion, total loans of $1.520 billion
and total deposits of $1.485 billion.
Conference Call
A conference call covering Independent Bank Group's quarter
earnings announcement will be held today, Tuesday, July 30, at 7:30
a.m. (CST) and can be accessed by calling 1-877-303-7611 and by
identifying the conference ID number 93877540. A recording of the
conference call will be available from July 30, 2013 through August
6, 2013 by calling 1-800-585-8367 and by identifying the conference
ID number 93877540.
Forward-Looking Statements
From time to time, our comments and releases may contain
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 (the "Act").
Forward-looking statements can be identified by words such as
"believes," "anticipates," "expects," "forecast," "guidance,"
"intends," "targeted," "continue," "remain," "should," "may,"
"plans," "estimates," "will," "will continue," "will remain,"
variations on such words or phrases, or similar references to
future occurrences or events in future periods; however, such words
are not the exclusive means of identifying such statements.
Examples of forward-looking statements include, but are not limited
to: (i) projections of revenues, expenses, income or loss, earnings
or loss per share, and other financial items; (ii) statements of
plans, objectives, and expectations of Independent Bank Group or
its management or Board of Directors; (iii) statements of future
economic performance; and (iv) statements of assumptions underlying
such statements. Forward-looking statements are based on
Independent Bank Group's current expectations and assumptions
regarding its business, the economy, and other future conditions.
Because forward-looking statements relate to the future, they are
subject to inherent uncertainties, risks, and changes in
circumstances that are difficult to predict. Independent Bank
Group's actual results may differ materially from those
contemplated by the forward-looking statements, which are neither
statements of historical fact nor guarantees or assurances of
future performance. Factors that could cause actual results to
differ from those discussed in the forward-looking statements
include, but are not limited to: (1) local, regional, national, and
international economic conditions and the impact they may have on
us and our customers and our assessment of that impact; (2)
volatility and disruption in national and international financial
markets; (3) government intervention in the U.S. financial system,
whether through changes in the discount rate or money supply or
otherwise; (4) changes in the level of non-performing assets and
charge-offs; (5) changes in estimates of future reserve
requirements based upon the periodic review thereof under relevant
regulatory and accounting requirements; (6) adverse conditions in
the securities markets that lead to impairment in the value of
securities in our investment portfolio; (7) inflation, deflation,
changes in market interest rates, developments in the securities
market, and monetary fluctuations; (8) the timely development and
acceptance of new products and services and perceived overall value
of these products and services by customers; (9) changes in
consumer spending, borrowings, and savings habits; (10)
technological changes; (11) the ability to increase market share
and control expenses; (12) changes in the competitive environment
among banks, bank holding companies, and other financial service
providers; (13) the effect of changes in laws and regulations
(including laws and regulations concerning taxes, banking,
securities, and insurance) with which we and our subsidiaries must
comply; (14) the effect of changes in accounting policies and
practices, as may be adopted by the regulatory agencies, as well as
the Public Company Accounting Oversight Board, the Financial
Accounting Standards Board, and other accounting standard setters;
(15) the costs and effects of legal and regulatory developments
including the resolution of legal proceedings; and (16) our success
at managing the risks involved in the foregoing items and (17) the
other factors that are described in the Company's Form 10-Q for the
quarter ended March 31, 2013 under the heading "Risk Factors" and
other reports and statements filed by the Company with the SEC. Any
forward-looking statement made by the Company in this release
speaks only as of the date on which it is made. Factors or events
that could cause the Company's actual results to differ may emerge
from time to time, and it is not possible for the Company to
predict all of them. The Company undertakes no obligation to
publicly update any forward-looking statement, whether as a result
of new information, future developments or otherwise, except as may
be required by law.
Non-GAAP Financial Measures
In addition to results presented in accordance with GAAP, this
press release contains certain non-GAAP financial measures. These
measures and ratios include "core pre-provision earnings",
"tangible book value", "tangible book value per common share",
"core efficiency ratio", "Tier 1 capital to average assets", "Tier
1 capital to risk weighted assets", "tangible common equity to
tangible assets", "net interest margin excluding purchase
accounting accretion", "adjusted return on average assets" and
"adjusted return on average equity" and are supplemental measures
that are not required by, or are not presented in accordance with,
accounting principles generally accepted in the United States. We
consider the use of select non-GAAP financial measures and ratios
to be useful for financial operational decision making and useful
in evaluating period-to-period comparisons. We believe that these
non-GAAP financial measures provide meaningful supplemental
information regarding our performance by excluding certain
expenditures or assets that we believe are not indicative of our
primary business operating results. We believe that management and
investors benefit from referring to these non-GAAP financial
measures in assessing our performance and when planning,
forecasting, analyzing and comparing past, present and future
periods.
We believe that these measures provide useful information to
management and investors that is supplementary to our financial
condition, results of operations and cash flows computed in
accordance with GAAP; however we acknowledge that our non‑GAAP
financial measures have a number of limitations relative to GAAP
financial measures. Certain non-GAAP financial measures exclude
items of income, expenditures, expenses, assets, or liabilities,
including provisions for loan losses and the effect of goodwill,
core deposit intangibles and income from accretion on acquired
loans arising from purchase accounting adjustments, that we believe
cause certain aspects of our results of operations or financial
condition to be not indicative of our primary operating results.
All of these items significantly impact our financial statements.
Additionally, the items that we exclude in our adjustments are not
necessarily consistent with the items that our peers may exclude
from their results of operations and key financial measures and
therefore may limit the comparability of similarly named financial
measures and ratios. We compensate for these limitations by
providing the equivalent GAAP measures whenever we present the
non-GAAP financial measures and by including a reconciliation of
the impact of the components adjusted for in the non-GAAP financial
measure so that both measures and the individual components may be
considered when analyzing our performance.
A reconciliation of our non-GAAP financial measures to the
comparable GAAP financial measures is included at the end of the
financial statements tables.
Independent Bank Group, Inc. and
Subsidiaries |
|
|
|
|
Consolidated Selected Financial
Data |
|
|
|
|
Three months ended June
30, 2013, March 31, 2013, December 31, 2012 and June 30,
2012 |
(Dollars in thousands, except for per
share data) |
|
|
|
|
(Unaudited) |
|
|
As of and for the
Three Months Ended |
|
June 30, |
March 31, |
December 31, |
June 30, |
|
2013 |
2012 |
|
|
|
|
|
Selected Income Statement
Data |
|
|
|
|
Interest income |
$21,105 |
$21,421 |
$20,214 |
$17,716 |
Interest expense |
3,255 |
3,206 |
3,423 |
3,411 |
Net interest income |
17,850 |
18,215 |
16,791 |
14,305 |
Provision for loan losses |
1,079 |
1,030 |
929 |
667 |
Net interest income after
provision for loan losses |
16,771 |
17,185 |
15,862 |
13,638 |
Noninterest income |
2,732 |
2,426 |
3,556 |
1,634 |
Noninterest expense |
13,384 |
13,923 |
13,329 |
11,601 |
Net income |
5,874 |
5,688 |
6,089 |
3,671 |
Proforma net income-after tax
(2) |
4,114 |
3,822 |
4,256 |
2,566 |
Core net interest income
(1) |
18,034 |
17,147 |
16,656 |
14,303 |
Core Pre-Tax Pre-Provision
Earnings (1) |
7,246 |
6,499 |
6,392 |
5,346 |
|
|
|
|
|
Per Share Data (Common
Stock) |
|
|
|
|
Earnings: |
|
|
|
|
Basic |
$0.49 |
$0.69 |
$0.74 |
$0.47 |
Diluted |
0.49 |
0.68 |
0.74 |
0.47 |
Pro forma earnings (after
tax): |
|
|
|
|
Basic (2) |
0.34 |
0.46 |
0.50 |
0.33 |
Diluted (2) |
0.34 |
0.46 |
0.50 |
0.33 |
Dividends |
— |
0.65 |
0.38 |
0.24 |
Book value |
17.75 |
15.01 |
15.06 |
14.02 |
Tangible book
value (1) |
15.13 |
11.16 |
11.19 |
10.50 |
Common shares outstanding |
12,064,967 |
8,269,707 |
8,269,707 |
7,842,288 |
|
|
|
|
|
Selected Period End Balance Sheet
Data |
|
|
|
|
Total assets |
$1,905,851 |
$1,764,134 |
$1,740,060 |
$1,476,554 |
Cash and cash equivalents |
126,519 |
80,890 |
102,290 |
50,129 |
Securities available for
sale |
110,932 |
114,540 |
113,355 |
95,746 |
Loans, held for sale |
8,458 |
6,090 |
9,162 |
5,704 |
Loans, held for investment |
1,511,915 |
1,415,906 |
1,369,514 |
1,179,665 |
Allowance for loan losses |
12,762 |
11,984 |
11,478 |
9,894 |
Goodwill and core deposit
intangible |
31,641 |
31,817 |
31,993 |
27,628 |
Other real estate owned |
8,182 |
8,459 |
6,819 |
8,696 |
Adriatica real estate
owned |
9,656 |
9,724 |
9,727 |
9,727 |
Noninterest-bearing
deposits |
261,618 |
243,235 |
259,664 |
190,612 |
Interest-bearing deposits |
1,223,511 |
1,171,864 |
1,131,076 |
1,011,153 |
Borrowings (other than junior
subordinated debentures) |
181,094 |
200,234 |
201,118 |
145,411 |
Junior subordinated
debentures |
18,147 |
18,147 |
18,147 |
14,538 |
Total stockholders' equity |
214,182 |
124,142 |
124,510 |
109,951 |
|
|
|
|
|
Independent Bank Group, Inc. and
Subsidiaries |
|
|
|
|
Consolidated Selected Financial
Data |
|
|
|
|
Three months ended June
30, 2013, March 31, 2013, December 31, 2012 and June 30,
2012 |
|
(Dollars in thousands, except for per
share data) |
|
|
|
|
(Unaudited) |
|
|
As of and for the
Six Months Ended |
|
June 30, |
March 31, |
December 31, |
June 30, |
|
2013 |
2012 |
|
|
|
|
|
Selected Performance
Metrics |
|
|
|
|
Return on average assets |
1.25% |
1.33% |
1.43% |
0.99% |
Return on average equity |
11.11 |
18.49 |
20.00 |
13.62 |
Pro forma return on average
assets (2) |
0.88 |
0.89 |
1.00 |
0.69 |
Pro forma return on average
equity (2) |
7.78 |
12.43 |
13.98 |
9.52 |
Adjusted return on average
assets (1) |
1.54 |
1.52 |
1.50 |
1.44 |
Adjusted return on average
equity (1) |
13.63 |
21.14 |
20.99 |
19.83 |
Net interest margin |
4.16 |
4.68 |
4.41 |
4.38 |
Adjusted net interest margin
(3) |
4.20 |
4.40 |
4.35 |
4.38 |
Efficiency ratio |
65.03 |
67.45 |
65.41 |
72.78 |
Core efficiency ratio (1) |
64.98 |
66.80 |
66.30 |
67.15 |
|
|
|
|
|
Credit Quality Ratios |
|
|
|
|
Nonperforming assets to total
assets |
1.27% |
1.35% |
1.59% |
2.30% |
Nonperforming loans to total
loans |
0.43 |
0.40 |
0.81 |
0.81 |
Allowance for loan losses to
non-performing loans |
198.14 |
209.73 |
104.02 |
103.63 |
Allowance for loan losses to
total loans |
0.84 |
0.85 |
0.84 |
0.84 |
Net charge-offs to average
loans outstanding (annualized) |
0.08 |
0.15 |
0.10 |
0.04 |
|
|
|
|
|
Capital Ratios |
|
|
|
|
Tier 1 capital to average
assets |
10.91% |
6.29% |
6.45% |
6.91% |
Tier 1 capital to risk-weighted
assets (1) |
13.80 |
8.01 |
8.22 |
8.35 |
Total capital to risk-weighted
assets |
15.69 |
10.20 |
10.51 |
10.58 |
Total stockholders' equity to
total assets |
11.24 |
7.04 |
7.16 |
7.45 |
Tangible common equity to
tangible assets (1) |
9.74 |
5.33 |
5.42 |
5.68 |
|
|
|
|
|
(1) Non-GAAP financial
measures. See reconciliation. |
(2) Income tax expense calculated
using effective tax rate as if the Company had been a C corporation
for the periods presented prior to second quarter 2013 (32.8%,
30.1% and 30.1%, respectively). The three months ended June
30, 2013 excludes $1,760 tax credit related to the initial
recording of the deferred tax asset. |
(3) Excludes income recognized on
acquired loans of $77, $1,068, $135, and $2, respectively and the
recognition of a $223 expense related to the write-off of
previously issued warrants related to subordinated debt retired in
the second quarter of 2013. |
|
|
|
|
|
Independent Bank Group, Inc. and
Subsidiaries |
|
|
|
|
Consolidated Statements of
Income |
|
|
|
|
Three and six months
ended June 30, 2013 and June 30, 2012 |
|
|
|
(Dollars in thousands) |
|
|
|
|
(Unaudited) |
|
|
|
|
|
Three months
ended June 30, |
Six months ended
June 30, |
|
2013 |
2012 |
2013 |
2012 |
Interest income: |
|
|
|
|
Interest and fees on loans |
$20,448 |
$17,107 |
$41,207 |
$32,006 |
Interest on taxable
securities |
308 |
313 |
641 |
660 |
Interest on nontaxable
securities |
258 |
200 |
507 |
399 |
Interest on federal funds sold
and other |
91 |
96 |
171 |
157 |
Total interest income |
21,105 |
17,716 |
42,526 |
33,222 |
|
|
|
|
|
Interest expense: |
|
|
|
|
Interest on deposits |
1,733 |
2,167 |
3,461 |
4,301 |
Interest on FHLB advances |
828 |
595 |
1,656 |
1,087 |
Interest on notes payable and
other borrowings |
558 |
524 |
1,073 |
974 |
Interest on junior subordinated
debentures |
136 |
125 |
271 |
253 |
Total interest expense |
3,255 |
3,411 |
6,461 |
6,615 |
|
|
|
|
|
Net interest
income |
17,850 |
14,305 |
36,065 |
26,607 |
|
|
|
|
|
Provision for loan losses |
1,079 |
667 |
2,109 |
1,242 |
|
|
|
|
|
Net interest income
after provision for loan losses |
16,771 |
13,638 |
33,956 |
25,365 |
|
|
|
|
|
Noninterest income: |
|
|
|
|
Service charges on deposit
accounts |
1,210 |
838 |
2,349 |
1,647 |
Mortgage fee income |
1,097 |
894 |
2,163 |
1,857 |
Gain (loss) on sale of other
real estate |
148 |
9 |
173 |
(44) |
Loss on sale of securities
available for sale |
— |
— |
— |
(3) |
Loss on sale of premises and
equipment |
(2) |
(346) |
(1) |
(345) |
Increase in cash surrender
value of BOLI |
79 |
81 |
160 |
163 |
Other |
200 |
158 |
314 |
250 |
Total noninterest
income |
2,732 |
1,634 |
5,158 |
3,525 |
|
|
|
|
|
Noninterest expense: |
|
|
|
|
Salaries and employee
benefits |
7,964 |
6,417 |
15,712 |
12,257 |
Occupancy |
2,298 |
1,824 |
4,445 |
3,494 |
Data processing |
316 |
292 |
612 |
559 |
FDIC assessment |
(258) |
214 |
(12) |
413 |
Advertising and public
relations |
188 |
185 |
404 |
339 |
Communications |
338 |
335 |
678 |
643 |
Net other real estate owned
expenses (including taxes) |
91 |
68 |
257 |
141 |
Operations of IBG Adriatica,
net |
175 |
228 |
372 |
528 |
Other real estate
impairment |
15 |
56 |
463 |
56 |
Core deposit intangible
amortization |
176 |
169 |
352 |
311 |
Professional fees |
293 |
205 |
565 |
448 |
Acquisition expense, including
legal |
(9) |
389 |
128 |
605 |
Other |
1,797 |
1,219 |
3,331 |
2,301 |
Total noninterest
expense |
13,384 |
11,601 |
27,307 |
22,095 |
|
|
|
|
|
Income before taxes |
6,119 |
3,671 |
11,807 |
6,795 |
Income tax expense |
245 |
— |
245 |
— |
Net
income |
$5,874 |
$3,671 |
$11,562 |
$6,795 |
|
|
|
|
|
Pro Forma: |
|
|
|
|
Income tax expense |
2,005 |
1,105 |
3,871 |
2,045 |
Net income |
$4,114 |
$2,566 |
$7,936 |
$4,750 |
|
|
|
|
Independent Bank Group, Inc. and
Subsidiaries |
|
|
|
Consolidated Balance
Sheets |
|
|
|
As of June 30, 2013, June 30, 2012
and December 31, 2012 |
|
|
|
(Dollars in thousands, except share
information) |
|
|
|
(Unaudited) |
|
|
|
|
June 30, |
June 30, |
December 31, |
|
2013 |
2012 |
2012 |
Assets |
|
|
|
|
Cash and due from banks |
$21,444 |
$18,654 |
$30,920 |
Federal Reserve Excess Balance Account
(EBA) |
70,075 |
31,475 |
71,370 |
Federal funds sold |
35,000 |
— |
— |
Cash and cash equivalents |
126,519 |
50,129 |
102,290 |
|
|
|
|
Certificates of deposit held in other
banks |
3,785 |
15,683 |
7,720 |
Securities available for sale (amortized cost
of $113,704 and $110,777, respectively) |
110,932 |
95,746 |
113,355 |
Loans held for sale |
8,458 |
5,704 |
9,162 |
Loans, net of allowance for loan losses of
$12,762 and $11,478, respectively |
1,499,153 |
1,169,771 |
1,358,036 |
Premises and equipment, net |
73,620 |
60,803 |
70,581 |
Other real estate owned |
8,182 |
8,696 |
6,819 |
Adriatica real estate |
9,656 |
15,779 |
9,727 |
Goodwill |
28,742 |
24,178 |
28,742 |
Core deposit intangible, net |
2,899 |
3,450 |
3,251 |
Federal Home Loan Bank (FHLB) of Dallas stock
and other restricted stock |
8,317 |
5,674 |
8,165 |
Bank-owned life insurance (BOLI) |
11,084 |
10,760 |
10,924 |
Deferred tax asset |
3,444 |
— |
— |
Other assets |
11,060 |
10,181 |
11,288 |
|
|
|
|
Total
assets |
$1,905,851 |
$1,476,554 |
$1,740,060 |
|
|
|
|
Liabilities and
Stockholders' Equity |
|
|
|
|
Deposits: |
|
|
|
Noninterest-bearing |
261,618 |
190,612 |
259,664 |
Interest-bearing |
1,223,511 |
1,011,153 |
1,131,076 |
Total
deposits |
1,485,129 |
1,201,765 |
1,390,740 |
|
|
|
|
FHLB advances |
164,529 |
104,697 |
164,601 |
Notes payable |
— |
23,986 |
15,729 |
Other borrowings |
16,565 |
16,728 |
20,788 |
Junior subordinated debentures |
18,147 |
14,538 |
18,147 |
Other liabilities |
7,299 |
4,889 |
5,545 |
Total
liabilities |
1,691,669 |
1,366,603 |
1,615,550 |
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
Stockholders' equity: |
|
|
|
Common stock (12,064,967 and 8,278,354 shares
outstanding, respectively) |
121 |
79 |
83 |
Additional paid-in capital |
209,396 |
79,626 |
88,791 |
Retained earnings |
5,874 |
28,084 |
33,290 |
Treasury stock, at cost (0 and 8,647 shares,
respectively) |
— |
(24) |
(232) |
Accumulated other comprehensive income |
(1,209) |
2,186 |
2,578 |
Total stockholders' equity |
214,182 |
109,951 |
124,510 |
|
|
|
|
Total liabilities and
stockholders' equity |
$1,905,851 |
$1,476,554 |
$1,740,060 |
|
Independent Bank Group,
Inc. and Subsidiaries |
Consolidated Average
Balance Sheet Amounts, Interest Earned and Yield
Analysis |
Three months ended June
30, 2013 and June 30, 2012 |
(Dollars in thousands) |
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
The analysis below shows average
interest earning assets and interest bearing liabilities together
with the average yield on the interest earning assets and the
average cost of the interest bearing liabilities for the periods
presented. |
|
|
For The Three
Months Ended June 30, |
|
2013 |
2012 |
|
Average |
|
|
Average |
|
|
|
Outstanding |
|
Yield/ |
Outstanding |
|
Yield/ |
|
Balance |
Interest |
Rate |
Balance |
Interest |
Rate |
|
|
|
|
|
|
|
Interest-earning
assets: |
|
|
|
|
|
|
Loans |
$1,469,684 |
$20,448 |
5.58% |
$1,147,876 |
$17,107 |
5.99% |
Taxable securities |
81,385 |
308 |
1.52 |
68,593 |
313 |
1.84 |
Nontaxable securities |
32,671 |
258 |
3.17 |
22,572 |
200 |
3.56 |
Federal funds sold and
other |
136,851 |
91 |
0.27 |
73,916 |
96 |
0.52 |
Total interest-earning
assets |
1,720,591 |
$21,105 |
4.92 |
1,312,957 |
$17,716 |
5.43 |
Noninterest-earning assets |
157,036 |
|
|
177,273 |
|
|
Total assets |
$1,877,627 |
|
|
$1,490,230 |
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
Checking accounts |
720,363 |
963 |
0.54 |
578,164 |
1,164 |
0.81 |
Savings accounts |
112,532 |
94 |
0.34 |
109,881 |
179 |
0.66 |
Limited access money market
accounts |
55,441 |
40 |
0.29 |
35,426 |
37 |
0.42 |
Certificates of deposit |
320,139 |
636 |
0.80 |
290,586 |
787 |
1.09 |
Total deposits |
1,208,475 |
1,733 |
0.58 |
1,014,057 |
2,167 |
0.86 |
FHLB advances |
164,542 |
828 |
2.02 |
101,976 |
595 |
2.35 |
Notes payable and other
borrowings |
17,651 |
558 |
12.68 |
41,472 |
524 |
5.08 |
Junior subordinated
debentures |
18,147 |
136 |
3.01 |
14,538 |
125 |
3.46 |
Total interest-bearing
liabilities |
1,408,815 |
3,255 |
0.93 |
1,172,043 |
3,411 |
1.17 |
Noninterest-bearing checking
accounts |
249,838 |
|
|
201,307 |
|
|
Noninterest-bearing
liabilities |
6,840 |
|
|
8,460 |
|
|
Stockholders' equity |
212,134 |
|
|
108,420 |
|
|
Total liabilities and
equity |
$1,877,627 |
|
|
$1,490,230 |
|
|
|
|
|
|
|
|
|
Net interest income |
|
$17,850 |
|
|
$14,305 |
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
3.99% |
|
|
4.26% |
Net interest margin |
|
|
4.16 |
|
|
4.38 |
Average interest-earning assets to average
interest bearing liabilities |
|
|
122.13% |
|
|
112.02% |
|
Independent Bank Group,
Inc. and Subsidiaries |
Consolidated Average
Balance Sheet Amounts, Interest Earned and Yield
Analysis |
Six months ended June 30,
2013 and June 30, 2012 |
(Dollars in thousands) |
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
The analysis below shows average
interest earning assets and interest bearing liabilities together
with the average yield on the interest earning assets and the
average cost of the interest bearing liabilities for the periods
presented. |
|
|
For The Six
Months Ended June 30, |
|
2013 |
2012 |
|
Average |
|
|
Average |
|
|
|
Outstanding |
|
Yield/ |
Outstanding |
|
Yield/ |
|
Balance |
Interest |
Rate |
Balance |
Interest |
Rate |
|
|
|
|
|
|
|
Interest-earning
assets: |
|
|
|
|
|
|
Loans |
$1,433,650 |
$41,207 |
5.80% |
$1,073,096 |
$32,006 |
6.00% |
Taxable securities |
81,875 |
641 |
1.58 |
68,793 |
660 |
1.93 |
Nontaxable securities |
32,245 |
507 |
3.17 |
22,451 |
399 |
3.57 |
Federal funds sold and
other |
104,429 |
171 |
0.33 |
62,085 |
157 |
0.51 |
Total interest-earning
assets |
1,652,199 |
42,526 |
5.19 |
1,226,425 |
33,222 |
5.45 |
Noninterest-earning assets |
155,313 |
|
|
154,649 |
|
|
Total assets |
$1,807,512 |
|
|
$1,381,074 |
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
Checking accounts |
706,830 |
1,909 |
0.54 |
530,445 |
2,280 |
0.86 |
Savings accounts |
113,476 |
185 |
0.33 |
106,578 |
403 |
0.76 |
Limited access money market
accounts |
47,057 |
64 |
0.27 |
31,721 |
64 |
0.41 |
Certificates of deposit |
312,188 |
1,303 |
0.84 |
279,525 |
1,554 |
1.12 |
Total deposits |
1,179,551 |
3,461 |
0.59 |
948,269 |
4,301 |
0.91 |
FHLB advances |
164,562 |
1,656 |
2.03 |
92,123 |
1,087 |
2.37 |
Notes payable and other
borrowings |
25,030 |
1,073 |
8.64 |
39,579 |
974 |
4.95 |
Junior subordinated
debentures |
18,147 |
271 |
3.01 |
14,538 |
253 |
3.50 |
Total interest-bearing
liabilities |
1,387,290 |
6,461 |
0.94 |
1,094,509 |
6,615 |
1.22 |
Noninterest-bearing checking
accounts |
237,942 |
|
|
181,758 |
|
|
Noninterest-bearing
liabilities |
5,269 |
|
|
5,816 |
|
|
Stockholders' equity |
177,011 |
|
|
98,991 |
|
|
Total liabilities and
equity |
$1,807,512 |
|
|
$1,381,074 |
|
|
|
|
|
|
|
|
|
Net interest income |
|
$36,065 |
|
|
$26,607 |
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
4.25% |
|
|
4.23% |
Net interest margin |
|
|
4.40 |
|
|
4.36 |
Average interest-earning assets
to average interest bearing liabilities |
|
119.10% |
|
|
112.05% |
|
|
|
|
|
Independent Bank Group,
Inc. and Subsidiaries |
|
|
|
|
Loan Portfolio
Composition |
|
|
|
|
As of June 30, 2013, June
30, 2012 and December 31, 2012 |
|
|
|
|
(Dollars in thousands) |
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
The following table sets forth
loan totals by category as of the dates presented: |
|
|
|
|
|
|
|
|
|
|
June 30,
2013 |
June 30,
2012 |
December 31,
2012 |
|
Amount |
% of Total |
Amount |
% of Total |
Amount |
% of Total |
|
|
|
|
|
|
|
Commercial |
$200,755 |
13.2% |
$118,805 |
10.0% |
$169,882 |
12.3% |
Real estate: |
|
|
|
|
|
|
Commercial real estate |
731,030 |
48.1 |
541,275 |
45.7 |
648,494 |
47.0 |
Commercial construction, land
and land development |
101,755 |
6.7 |
92,200 |
7.8 |
97,329 |
7.1 |
Residential real estate
(1) |
337,274 |
22.2 |
294,700 |
24.9 |
315,349 |
22.9 |
Single-family interim
construction |
71,844 |
4.7 |
61,508 |
5.2 |
67,920 |
4.9 |
Agricultural |
34,491 |
2.3 |
38,187 |
3.2 |
40,127 |
2.9 |
Consumer |
43,160 |
2.8 |
38,631 |
3.2 |
39,502 |
2.9 |
Other |
64 |
0.0 |
63 |
0.0 |
73 |
0.0 |
Total loans |
1,520,373 |
100.0% |
1,185,369 |
100.0% |
1,378,676 |
100.0% |
Other items: |
|
|
|
|
|
|
Allowance for losses |
(12,762) |
|
(9,894) |
|
(11,478) |
|
Total loans, net |
$1,507,611 |
|
$1,175,475 |
|
$1,367,198 |
|
|
|
|
|
|
|
|
(1) Includes loans held for sale
at June 30, 2013, June 30, 2012 and December 31, 2012 of $8,458,
$5,704 and $9,162, respectively. |
|
|
|
|
Independent Bank Group,
Inc. and Subsidiaries |
|
|
|
Reconciliation of Non
GAAP Financial Measures |
|
|
|
Three months ended June
30, 2013, March 31, 2013, December 31, 2012 and June 30,
2012 |
(Dollars in thousands,
except for per share data) |
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
The following tables reconcile
non GAAP financial measures: |
|
|
|
|
|
For the Three
Months Ended |
|
|
June 30, 2013 |
March 31, 2013 |
December 31, 2012 |
June 30, 2012 |
|
|
|
|
|
|
Net Interest Income -
Reported |
(a) |
$17,850 |
$18,215 |
$16,791 |
$14,305 |
Write-off of debt origination
warrants |
|
223 |
— |
— |
— |
Income recognized on acquired
loans |
|
(77) |
(1,068) |
(135) |
(2) |
Adjusted Net Interest
Income |
(b) |
17,996 |
17,147 |
16,656 |
14,303 |
|
|
|
|
|
|
Provision Expense -
Reported |
(c) |
1,079 |
1,030 |
929 |
667 |
|
|
|
|
|
|
Noninterest Income -
Reported |
(d) |
2,732 |
2,426 |
3,556 |
1,634 |
Loss / (Gain) on Sale of
OREO |
|
(148) |
(25) |
(1,210) |
(9) |
Loss / (Gain) on Sale of
PP&E |
|
2 |
(1) |
— |
346 |
Adjusted Noninterest
Income |
(e) |
2,586 |
2,400 |
2,346 |
1,971 |
|
|
|
|
|
|
Noninterest Expense -
Reported |
(f) |
13,384 |
13,923 |
13,329 |
11,601 |
Adriatica Expenses |
|
(175) |
(197) |
(91) |
(228) |
OREO Impairment |
|
(15) |
(448) |
(38) |
(56) |
FDIC refund |
|
504 |
— |
— |
— |
IPO related stock grant and
bonus expense |
|
(333) |
— |
— |
— |
OREO back property tax |
|
— |
(93) |
— |
— |
Acquisition Expense |
|
9 |
(137) |
(590) |
(389) |
Adjusted Noninterest
Expense |
(g) |
13,374 |
13,048 |
12,610 |
10,928 |
|
|
|
|
|
|
Pre-Tax Pre-Provision
Earnings |
(a) + (d) - (f) |
$7,198 |
$6,718 |
$7,018 |
$4,338 |
|
|
|
|
|
|
Core Pre-Tax
Pre-Provision Earnings |
(b) + (e) - (g) |
$7,208 |
$6,499 |
$6,392 |
$5,346 |
|
|
|
|
|
|
Reported Efficiency
Ratio |
(f) / (a + d) |
65.0% |
67.5% |
65.4% |
72.8% |
|
|
|
|
|
|
Core Efficiency
Ratio |
(g) / (b + e) |
64.9% |
66.8% |
66.3% |
67.2% |
|
|
|
|
|
|
Adjusted Return on
Average Assets (1) |
|
1.54% |
1.52% |
1.50% |
1.44% |
|
|
|
|
|
|
Adjusted Return on
Average Equity (1) |
|
13.63% |
21.14% |
20.99% |
19.83% |
|
|
|
|
|
|
Total Average
Assets |
|
$1,877,627 |
$1,733,924 |
$1,698,779 |
$1,490,230 |
|
|
|
|
|
|
Total Average
Stockholders' Equity |
|
$212,134 |
$124,731 |
$121,121 |
$108,420 |
|
|
|
|
|
|
(1) Calculated
using core pre-tax pre-provision earnings |
|
|
|
|
|
Independent Bank Group,
Inc. and Subsidiaries |
Reconciliation of Non
GAAP Financial Measures |
As of June 30, 2013, June
30, 2012 and December 31, 2012 |
(Dollars in thousands,
except per share information) |
(Unaudited) |
|
|
|
|
|
|
|
Tangible Book Value Per Common
Share |
|
|
|
|
June
30, |
December 31, |
|
2013 |
2012 |
2012 |
Tangible Common Equity |
|
|
|
Total stockholders' equity |
$214,182 |
$109,951 |
$124,510 |
Adjustments: |
|
|
|
Goodwill |
(28,742) |
(24,178) |
(28,742) |
Core deposit intangibles |
(2,899) |
(3,450) |
(3,251) |
Tangible common
equity |
$182,541 |
$82,323 |
$92,517 |
Common shares outstanding |
12,064,967 |
7,842,288 |
8,269,707 |
|
|
|
|
Book value per common share |
$17.75 |
$14.02 |
$15.06 |
Tangible book value per common share |
15.13 |
10.50 |
11.19 |
|
|
|
|
|
|
|
|
Tier 1 Capital to Risk-Weighted
Assets Ratio |
|
|
|
|
June
30, |
December 31, |
|
2013 |
2012 |
2012 |
Tier 1 Common Equity |
|
|
|
Total stockholders' equity -
GAAP |
$214,182 |
$109,951 |
$124,510 |
Adjustments: |
|
|
|
Unrealized (gain) loss on
available-for-sale securities |
1,209 |
(2,186) |
(2,578) |
Goodwill |
(28,742) |
(24,178) |
(28,742) |
Other intangibles |
(2,899) |
(3,450) |
(3,251) |
Qualifying Restricted Core
Capital Elements (TRUPS) |
17,600 |
14,100 |
17,600 |
Tier 1 common
equity |
$201,350 |
$94,237 |
$107,539 |
Total Risk-Weighted
Assets |
|
|
|
On balance sheet |
$1,437,610 |
$1,099,364 |
$1,297,795 |
Off balance sheet |
21,845 |
12,370 |
10,860 |
Total risk-weighted
assets |
$1,459,455 |
$1,111,734 |
$1,308,655 |
Total stockholders' equity to risk-weighted
assets ratio |
14.68% |
9.89% |
9.51% |
Tier 1 common equity to risk-weighted assets
ratio |
13.80 |
8.48 |
8.22 |
CONTACT: Analysts/Investors:
Torry Berntsen
President and Chief Operating Officer
(972) 562-9004
tberntsen@independent-bank.com
Michelle Hickox
Executive Vice President and Chief Financial Officer
(972) 562-9004
mhickox@independent-bank.com
Media:
Eileen Ponce
Marketing Director
(469) 742-9437
eponce@independent-bank.com
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