Guaranty Bancshares, Inc. (NYSE: GNTY) (the "Company"), the
parent company of Guaranty Bank & Trust, N.A. (the "Bank"),
today reported financial results for the fiscal quarter and year
ended December 31, 2023. The Company's net income available to
common shareholders was $5.9 million, or $0.51 per basic share, for
the quarter ended December 31, 2023, compared to $6.3 million, or
$0.54 per basic share, for the quarter ended September 30, 2023 and
$8.0 million, or $0.67 per basic share, for the quarter ended
December 31, 2022. Return on average assets and average equity for
the fourth quarter of 2023 were 0.73% and 7.93%, respectively,
compared to 0.78% and 8.43%, respectively, for the third quarter of
2023 and 0.95% and 10.88%, respectively, for the fourth quarter of
2022. The decrease in earnings during the fourth quarter of 2023
compared to the third quarter of 2023 was primarily due to
fluctuations in general operating expenses. The decrease in
earnings in the fourth quarter of 2023 compared to the fourth
quarter of 2022 was primarily due to lower net interest income in
the current quarter, offset by a $2.8 million provision for credit
losses in the prior year quarter.
"Despite the many industry headwinds in 2023, our earnings were
relatively good. Our net interest margin hit its lowest point in
2023 during the third quarter but has steadily increased each month
in the fourth quarter as our loans reprice and cost of non-maturing
deposits remain steady. Our balance sheet is strong and our
earnings stream continues to produce consistent results.
Non-performing assets remain very low and although we anticipate
the need to work with some borrowers as their loan rates adjust, we
do not foresee any significant problems as a result of the higher
interest rate environment or economic slowdown at this point. We
are looking forward to 2024 and have built a balance sheet that
will allow us to grow and capitalize on new opportunities when the
timing is right and economic conditions become less uncertain. Our
liquidity and capital remains very healthy and we continue to focus
on driving long term shareholder value," said Ty Abston, the
Company's Chairman and Chief Executive Officer.
QUARTERLY AND ANNUAL HIGHLIGHTS
- Strong Asset Quality. Nonperforming assets as a
percentage of total assets were 0.18% at December 31, 2023,
compared to 0.09% at September 30, 2023 and 0.32% at December 31,
2022. Net charge-offs (annualized) to average loans were 0.04% for
the quarter ended December 31, 2023, compared to 0.11% for the
quarter ended September 30, 2023, and 0.01% for the quarter ended
December 31, 2022. Net charge-offs to average loans for the years
ending December 31, 2023 and 2022 were 0.04% and 0.03%,
respectively. Commercial real estate (CRE) loans, particularly
office related loans, have received increased scrutiny in recent
months. Our CRE loans and real estate C&D loans represent 39.7%
and 12.8% of the total loan portfolio, respectively. Office-related
loans represent 4.6% of the total loan portfolio and have an
average balance of $515,000.
- Granular and Stable Core Deposit Base. As of December
31, 2023, we have 87,664 total deposit accounts with an average
account balance of $30,038. We have a historically reliable core
deposit base, with strong and trusted banking relationships. Total
deposits decreased by $25.0 million during the fourth quarter,
which consisted primarily of a decrease in DDA balances of $48.6
million, a decrease in time deposits of $8.1 million and offset by
an increase in savings and MMDA balances of $33.5 million. The
decrease in time deposits resulted in part due to $25.0 million in
brokered CDs that matured and were not renewed during the fourth
quarter. The Bank has not historically used brokered deposits and
does not foresee a reliance on them going forward, however, our
year-end deposit balance does include $25.0 million of brokered
deposits that mature in February 2024 and were issued, along with
the $25.0 million that matured in the fourth quarter, to test their
availability as a contingent liquidity source. Excluding public
funds and bank-owned accounts, our uninsured deposits as of
December 31, 2023 were 25.07% of total deposits. Interest rates
paid on deposits during the quarter stabilized with minimal
increases. Despite the decrease in DDA during the quarter,
noninterest-bearing deposits still represent 32.4% of total
deposits. Our cost of interest-bearing deposits increased 17 basis
points during the quarter from 3.00% in the prior quarter to 3.17%,
representing a beta on interest-bearing deposits of approximately
62.7% for the linked quarter compared to the federal funds target
rates. These increases are primarily due to renewals of maturing
certificates of deposit into new CD's paying higher rates. Our cost
of total deposits for the fourth quarter of 2023 increased 16 basis
points from 1.98% in the prior quarter to 2.14%, representing a
beta on total deposits of approximately 59.0% for the linked
quarter.
- Healthy Capital and Liquidity. Our capital and liquidity
ratios, as well as contingent liquidity sources, remain very
healthy. During the fourth quarter of 2023, we repurchased 24,800
shares, or 0.21% of average shares outstanding during the period,
at an average price of $27.76 per share. During the year, we
repurchased 434,798 shares at an average price of $25.82 per share.
Our liquidity ratio, calculated as cash and cash equivalents and
unpledged investments divided by total liabilities, was 12.2% as of
December 31, 2023, compared to 14.5% as of December 31, 2022. Our
total available contingent liquidity, net of current outstanding
borrowings, is $1.2 billion, consisting of FHLB, FRB and
correspondent bank fed funds and revolving lines of credit.
Finally, our total equity to average quarterly assets as of
December 31, 2023 was 9.5%. If we had to recognize our entire
unrealized losses on both AFS and HTM securities, our total equity
to average assets ratio would be 8.8%†, which is still a
strong capital level under regulatory requirements.
† Non-GAAP financial metric.
Calculations of this metric and reconciliations to GAAP are
included in the schedules accompanying this release.
RESULTS OF OPERATIONS
Net interest income, before the provision for credit losses, in
the fourth quarter of 2023 and 2022 was $23.8 million and $28.4
million, respectively, a decrease of $4.5 million, or 16.0%. The
decrease in net interest income resulted from an increase in
interest expense of $9.6 million, or 130.7%, compared to the prior
year quarter, which was partially offset by an increase in interest
income of $5.1 million, or 14.2%, from the same quarter in the
prior year. The increases in both interest income and expense
resulted primarily from higher rates during the period. Interest
expense was also impacted by a shift from noninterest-bearing to
interest-bearing deposit accounts, which resulted in increased
expense in the fourth quarter of 2023 compared to the prior year
quarter.
Net interest margin, on a fully taxable equivalent basis, for
the fourth quarter of 2023 and 2022 was 3.11% and 3.57%,
respectively. Net interest margin decreased 46 basis points
primarily due to interest-bearing liabilities repricing faster than
our interest-earning assets and a shift from no or lower interest
cost DDA and money market accounts to higher cost certificates of
deposit. The cost of interest-bearing liabilities increased 184
basis points from the prior year quarter, while interest earning
asset yields increased 90 basis points. The increase in the cost of
interest-bearing liabilities was due primarily to an increase in
the cost of interest-bearing deposits from 1.08% to 3.17%, a change
of 209 basis points, in the fourth quarter of 2023 compared to the
same period in 2022, as well as increased rates on FHLB advances,
which increased from 3.97% to 5.40%, an increase of 143 basis
points, from the prior year quarter. The increases in cost were
partially offset by increases in yield on the loan portfolio from
5.19% to 6.06%, or 87 basis points, as well as 38 and 34 basis
point increases in yield on AFS and HTM securities, respectively.
Although the cost of interest-bearing liabilities have repriced
more quickly during this period, the weighted average yield on
$89.6 million in new loans originated in the fourth quarter was
8.61%.
Net interest income, before the provision for credit losses,
increased $511,000, or 2.2%, from $23.3 million in the third
quarter of 2023 to $23.8 million in the fourth quarter of 2023. The
increase in net interest income resulted primarily from an increase
in interest income of $978,000, or 2.5%, partially offset by an
increase in interest expense of $467,000, or 2.8%. The increase in
interest income was primarily due to higher interest earned on
loans of $808,000, or 2.3%, from the prior quarter and higher
interest earned on securities of $103,000, or 2.5%. The increase in
interest expense resulted primarily from an increase of $1.2
million, or 9.5%, in interest-bearing deposit expense, partially
offset by a decrease in FHLB advances expense of $673,000, or
26.0%, and a decrease in interest expense on other borrowed money
of $102,000, or 31.4%, from the prior quarter.
Net interest margin, on a taxable equivalent basis, increased
from 3.02% for the third quarter of 2023 to 3.11% for the fourth
quarter of 2023, an increase of nine basis points. The increase in
net interest margin was primarily due to an increase on loan yield
from 5.91% for the third quarter of 2023 to 6.06% for the fourth
quarter of 2023, a change of 15 basis points. This increase was
partially offset by an increase in the cost of interest-bearing
deposits from 3.00% in the third quarter to 3.17% in the fourth
quarter of 2023, a change of 17 basis points.
We recorded no provision for credit losses during 2023. During
the fourth quarter of 2022, we recorded a $2.8 million provision to
incorporate forecasts for an economic downturn and possible
borrower stressors into our CECL model. The factors that were
adjusted in the fourth quarter of 2022 remain relevant, however
certain minor adjustments were made in subsequent quarters to
reflect current portfolio credit quality trends. As of December 31,
2023 and December 31, 2022, our allowance for credit losses as a
percentage of total loans was 1.33% and 1.34%, respectively.
Noninterest income decreased $326,000, or 6.4%, in the fourth
quarter of 2023 to $4.8 million, compared to $5.1 million for the
fourth quarter of 2022. The decrease from the same quarter in 2022
was partially due to a gain on securities sold of $172,000 in the
prior year quarter and no gain on securities sales in the current
quarter. There was also a decrease in the gain on sale of loans of
$114,000, or 36.8% along with a $51,000, or 63.0%, decrease in
mortgage fee income compared to the same quarter in the prior
year.
Noninterest expense increased $505,000, or 2.4%, in the fourth
quarter of 2023 to $21.4 million, compared to $20.9 million for the
fourth quarter of 2022. The increase in noninterest expense in the
fourth quarter of 2023 was driven primarily by a $351,000, or 2.8%,
increase in employee compensation and benefits, an increase in
software and technology expense of $215,000, or 14.1%, and a
$175,000, or 22.5%, increase in legal and professional fees
primarily related to recruiting fees compared to the fourth quarter
of 2022. These were partially offset by a $136,000, or 27.9%,
decrease in advertising and promotions expense.
Noninterest income in the fourth quarter of 2023 decreased by
$143,000, or 2.9%, from $4.9 million in the third quarter of 2023.
The decrease is primarily due to a decrease in other noninterest
income of $62,000, or 8.2%, primarily the result of decreased
credit card income during the period. Gain on sale of loans
decreased $22,000, or 10.1%, while bank-owned life insurance income
decreased $17,000, or 6.4%. Additionally, mortgage fee income fell
$16,000, or 34.8%, and loan processing fee income decreased
$12,000, or 9.4% from the third quarter.
Noninterest expense increased $888,000, or 4.3%, in the fourth
quarter of 2023, from $20.5 million for the quarter ended September
30, 2023. The increase resulted from an increase of $771,000, or
6.5%, in employee compensation and benefits primarily due to annual
raises, which went into effect during the fourth quarter. There was
also a $250,000, or 16.8%, increase in software and technology
expense and a $64,000, or 22.2%, increase in advertising and
promotions expense during the fourth quarter of 2023 compared to
the third quarter of 2023. These increases were partially offset by
a $203,000, or 6.9%, decrease in occupancy expenses due to lower
than anticipated property taxes payable and a reverse accrual
posted in the fourth quarter, compared with the third quarter of
2023.
The Company’s efficiency ratio in the fourth quarter of 2023 was
74.81%, compared to 62.42% in the prior year quarter and 72.64% in
the third quarter of 2023.
FINANCIAL CONDITION
Consolidated assets for the Company totaled $3.18 billion at
December 31, 2023, compared to $3.23 billion at September 30, 2023
and $3.35 billion at December 31, 2022.
Gross loans increased slightly by $4.3 million, or 0.19%, during
the quarter resulting in a gross loan balance of $2.32 billion at
both December 31, 2023 and September 30, 2023. Our loan growth is
entirely due to organic loan growth during the quarter and not to
purchases of assets.
Gross loans decreased $55.6 million, or 2.3%, from $2.38 billion
at December 31, 2022. The decrease in gross loans during the fourth
quarter of 2023 compared to the fourth quarter of 2022 resulted
from tightened credit underwriting standards and loan terms, along
with fewer borrower requests in response to higher interest rates.
Additionally, there was a $10.7 million decrease in warehouse
lending loans, as we discontinued that line of business in the
second quarter of 2023.
Total deposits decreased by $25.0 million, or 0.9%, to $2.63
billion at December 31, 2023, compared to $2.66 billion at
September 30, 2023, and decreased $47.9 million, or 1.8%, from
$2.68 billion at December 31, 2022. The decrease in deposits during
the fourth quarter resulted from a decrease in noninterest-bearing
deposits of $50.4 million, offset by an increase in
interest-bearing deposits of $25.4 million. We also allowed $25.0
million in brokered certificates of deposit to mature and not renew
during the fourth quarter of 2023. The decrease in deposits during
the current quarter compared to the prior year quarter resulted
primarily from a decrease in noninterest-bearing deposits of $199.2
million, partially offset by an increase in interest-bearing
deposits of $151.3 million.
Nonperforming assets as a percentage of total loans were 0.25%
at December 31, 2023, compared to 0.13% at September 30, 2023 and
0.46% at December 31, 2022. Nonperforming assets as a percentage of
total assets were 0.18% at December 31, 2023, compared to 0.09% at
September 30, 2023, and 0.32% at December 31, 2022. The Bank's
nonperforming assets consist primarily of nonaccrual loans. The
decrease in nonperforming assets compared to the prior year end is
primarily due to the resolution of several lower balance
nonperforming assets during 2023.
Total equity was $303.8 million as of December 31, 2023,
compared to $296.8 million at September 30, 2023 and $295.6 million
at December 31, 2022. The increase from the previous quarter
resulted primarily from net income of $5.9 million and a reduction
in accumulated other comprehensive loss of $4.2 million due to
increases in the fair value of available for sale securities during
the period. This was partially offset by the payment of dividends
of $2.7 million during the fourth quarter of 2023.
As of
2023
2022
(dollars in thousands)
December 31
September 30
June 30
March 31
December 31
ASSETS
Cash and due from banks
$
47,744
$
47,922
$
47,663
$
59,030
$
52,390
Federal funds sold
36,575
73,275
44,950
95,400
47,275
Interest-bearing deposits
5,205
8,980
4,738
3,695
6,802
Total cash and cash equivalents
89,524
130,177
97,351
158,125
106,467
Securities available for sale
196,195
178,644
166,596
173,744
188,927
Securities held to maturity
404,208
408,308
437,292
476,105
509,008
Loans held for sale
976
2,506
795
1,260
3,156
Loans, net
2,290,881
2,286,163
2,300,882
2,344,240
2,344,245
Accrued interest receivable
13,143
11,307
11,110
10,443
11,555
Premises and equipment, net
57,018
56,712
56,151
55,457
54,291
Other real estate owned
—
—
—
38
38
Cash surrender value of life insurance
42,348
42,096
41,830
38,619
38,404
Core deposit intangible, net
1,418
1,524
1,633
1,746
1,859
Goodwill
32,160
32,160
32,160
32,160
32,160
Other assets
56,920
80,816
60,396
64,350
61,385
Total assets
$
3,184,791
$
3,230,413
$
3,206,196
$
3,356,287
$
3,351,495
LIABILITIES AND EQUITY
Deposits
Noninterest-bearing
$
852,957
$
903,391
$
915,462
$
992,527
$
1,052,144
Interest-bearing
1,780,289
1,754,902
1,687,355
1,630,841
1,629,010
Total deposits
2,633,246
2,658,293
2,602,817
2,623,368
2,681,154
Securities sold under agreements to
repurchase
25,172
19,366
20,532
13,338
7,221
Accrued interest and other liabilities
32,242
31,218
30,701
30,125
28,409
Line of credit
4,500
2,000
12,000
—
—
Federal Home Loan Bank advances
140,000
175,000
195,000
340,000
290,000
Subordinated debentures
45,785
47,752
47,719
49,186
49,153
Total liabilities
2,880,945
2,933,629
2,908,769
3,056,017
3,055,937
Equity attributable to Guaranty
Bancshares, Inc.
303,300
296,226
296,862
299,700
294,984
Noncontrolling interest
546
558
565
570
574
Total equity
303,846
296,784
297,427
300,270
295,558
Total liabilities and equity
$
3,184,791
$
3,230,413
$
3,206,196
$
3,356,287
$
3,351,495
Quarter Ended
2023
2022
(dollars in thousands, except per share
data)
December 31
September 30
June 30
March 31
December 31
STATEMENTS OF EARNINGS
Interest income
$
40,796
$
39,818
$
38,734
$
37,144
$
35,720
Interest expense
16,983
16,516
14,031
11,982
7,362
Net interest income
23,813
23,302
24,703
25,162
28,358
Provision for credit losses
—
—
—
—
2,800
Net interest income after provision for
credit losses
23,813
23,302
24,703
25,162
25,558
Noninterest income
4,796
4,939
7,873
4,905
5,122
Noninterest expense
21,402
20,514
20,471
19,967
20,897
Income before income taxes
7,207
7,727
12,105
10,100
9,783
Income tax provision
1,341
1,437
2,529
1,823
1,764
Net earnings
$
5,866
$
6,290
$
9,576
$
8,277
$
8,019
Net loss attributable to noncontrolling
interest
12
7
5
4
3
Net earnings attributable to Guaranty
Bancshares, Inc.
$
5,878
$
6,297
$
9,581
$
8,281
$
8,022
PER COMMON SHARE DATA
Earnings per common share, basic
$
0.51
$
0.54
$
0.82
$
0.69
$
0.67
Earnings per common share, diluted
0.51
0.54
0.81
0.69
0.67
Cash dividends per common share
0.23
0.23
0.23
0.23
0.22
Book value per common share - end of
quarter
26.28
25.64
25.58
25.13
24.70
Tangible book value per common share - end
of quarter(1)
23.37
22.72
22.67
22.29
21.85
Common shares outstanding - end of
quarter(4)
11,540,644
11,554,094
11,603,167
11,925,357
11,941,672
Weighted-average common shares
outstanding, basic
11,536,878
11,568,897
11,735,475
11,939,593
11,938,973
Weighted-average common shares
outstanding, diluted
11,589,165
11,619,342
11,756,512
12,012,004
12,048,475
PERFORMANCE RATIOS
Return on average assets (annualized)
0.73
%
0.78
%
1.17
%
1.01
%
0.95
%
Return on average equity (annualized)
7.93
8.43
12.87
11.18
10.88
Net interest margin, fully taxable
equivalent (annualized)(2)
3.11
3.02
3.19
3.24
3.57
Efficiency ratio(3)
74.81
72.64
62.84
66.41
62.42
(1) See Reconciliation of non-GAAP
Financial Measures table.
(2) Net interest margin on a taxable
equivalent basis is equal to net interest income adjusted for
nontaxable income divided by average interest-earning assets,
annualized, using a marginal tax rate of 21%.
(3) The efficiency ratio was calculated by
dividing total noninterest expense by net interest income plus
noninterest income, excluding securities gains or losses. Taxes are
not part of this calculation.
(4) Excludes the dilutive effect, if any,
of shares of common stock issuable upon exercise of outstanding
stock options.
For the Years Ended
December 31,
(dollars in thousands, except per share
data)
2023
2022
INCOME STATEMENTS
Interest income
$
156,492
$
123,209
Interest expense
59,512
15,380
Net interest income
96,980
107,829
Provision for loan losses
—
2,150
Net interest income after provision for
loan losses
96,980
105,679
Noninterest income
22,513
23,485
Noninterest expense
82,354
79,907
Income before income taxes
37,139
49,257
Income tax provision
7,130
8,834
Net earnings
$
30,009
$
40,423
Net loss attributable to noncontrolling
interest
28
24
Net earnings attributable to Guaranty
Bancshares, Inc.
$
30,037
$
40,447
PER COMMON SHARE DATA
Earnings per common share, basic
$
2.57
$
3.38
Earnings per common share, diluted
2.56
3.34
Cash dividends per common share
0.92
0.88
Book value per common share - end of
period
26.28
24.70
Tangible book value per common share - end
of period(1)
23.37
21.85
Common shares outstanding - end of
period(4)
11,540,644
11,941,672
Weighted-average common shares
outstanding, basic
11,693,761
11,980,209
Weighted-average common shares
outstanding, diluted
11,738,605
12,092,847
PERFORMANCE RATIOS
Return on average assets
0.92
%
1.24
%
Return on average equity
10.10
13.76
Net interest margin, fully taxable
equivalent(2)
3.15
3.54
Efficiency ratio(3)
68.92
60.85
(1) See Reconciliation of non-GAAP
Financial Measures table.
(2) Net interest margin on a taxable
equivalent basis is equal to net interest income adjusted for
nontaxable income divided by average interest-earning assets,
annualized, using a marginal tax rate of 21%.
(3) The efficiency ratio was calculated by
dividing total noninterest expense by net interest income plus
noninterest income, excluding securities gains or losses. Taxes are
not part of this calculation.
(4) Excludes the dilutive effect, if any,
of shares of common stock issuable upon exercise of outstanding
stock options.
As of
2023
2022
(dollars in thousands)
December 31
September 30
June 30
March 31
December 31
LOAN PORTFOLIO COMPOSITION
Commercial and industrial
$
287,565
$
292,410
$
295,864
$
295,936
$
314,067
Real estate:
Construction and development
296,639
317,484
345,127
372,203
377,135
Commercial real estate
923,195
901,321
891,883
900,190
887,587
Farmland
186,295
188,614
187,105
190,802
185,817
1-4 family residential
514,603
504,002
496,340
499,944
493,061
Multi-family residential
44,292
42,720
44,385
44,760
45,147
Consumer
57,059
58,294
59,498
60,163
61,394
Agricultural
12,685
13,076
13,447
13,545
13,686
Overdrafts
243
328
252
270
282
Total loans(1)(2)
$
2,322,576
$
2,318,249
$
2,333,901
$
2,377,813
$
2,378,176
Quarter Ended
2023
2022
(dollars in thousands)
December 31
September 30
June 30
March 31
December 31
ALLOWANCE FOR CREDIT LOSSES
Balance at beginning of period
$
31,140
$
31,759
$
31,953
$
31,974
$
29,235
Loans charged-off
(242
)
(644
)
(224
)
(94
)
(103
)
Recoveries
22
25
30
73
42
Provision for credit loss expense
—
—
—
—
2,800
Balance at end of period
$
30,920
$
31,140
$
31,759
$
31,953
$
31,974
Allowance for credit losses / period-end
loans
1.33
%
1.34
%
1.36
%
1.34
%
1.34
%
Allowance for credit losses /
nonperforming loans
552.9
1,148.2
894.6
238.4
294.7
Net charge-offs / average loans
(annualized)
0.04
0.11
0.03
0.00
0.01
NONPERFORMING ASSETS
Nonaccrual loans
$
5,592
$
2,712
$
3,550
$
13,405
$
10,848
Other real estate owned
—
—
—
38
38
Repossessed assets owned
234
250
—
—
—
Total nonperforming assets
$
5,826
$
2,962
$
3,550
$
13,443
$
10,886
Nonperforming assets as a percentage
of:
Total loans(1)(2)
0.25
%
0.13
%
0.15
%
0.57
%
0.46
%
Total assets
0.18
0.09
0.11
0.40
0.32
(1) Excludes outstanding balances of loans
held for sale of $976,000, $2.5 million, $795,000, $1.3 million,
and $3.2 million as of December 31, September 30, June 30 and March
31, 2023, and December 31, 2022, respectively.
(2) Excludes deferred loan fees of
$775,000, $946,000, $1.3 million, $1.6 million, and $2.0 million as
of December 31, September 30, June 30 and March 31, 2023, and
December 31, 2022, respectively.
Quarter Ended
2023
2022
(dollars in thousands)
December 31
September 30
June 30
March 31
December 31
NONINTEREST INCOME
Service charges
$
1,123
$
1,131
$
1,056
$
1,077
$
1,096
Net realized gain (loss) on securities
transactions
—
—
(322
)
93
172
Net realized gain on sale of loans
196
218
473
314
310
Fiduciary and custodial income
624
637
630
638
642
Bank-owned life insurance income
249
267
211
214
209
Merchant and debit card fees
1,760
1,752
2,121
1,674
1,711
Loan processing fee income
116
128
142
134
150
Mortgage fee income
30
46
50
68
81
Other noninterest income
698
760
3,512
693
751
Total noninterest income
$
4,796
$
4,939
$
7,873
$
4,905
$
5,122
NONINTEREST EXPENSE
Employee compensation and benefits
$
12,715
$
11,944
$
11,939
$
12,264
$
12,364
Occupancy expenses
2,757
2,960
2,754
2,830
2,770
Legal and professional fees
954
902
985
583
779
Software and technology
1,740
1,490
1,531
1,396
1,525
Amortization
145
147
149
161
161
Director and committee fees
186
192
201
199
199
Advertising and promotions
352
288
269
267
488
ATM and debit card expense
763
803
739
599
740
Telecommunication expense
175
178
171
183
193
FDIC insurance assessment fees
321
363
522
301
359
Other noninterest expense
1,294
1,247
1,211
1,184
1,319
Total noninterest expense
$
21,402
$
20,514
$
20,471
$
19,967
$
20,897
Quarter Ended December
31,
2023
2022
(dollars in thousands)
Average Outstanding
Balance
Interest Earned/ Interest
Paid
Average Yield/ Rate
Average Outstanding
Balance
Interest Earned/ Interest
Paid
Average Yield/ Rate
ASSETS
Interest-earning assets:
Total loans(1)
$
2,329,227
$
35,573
6.06
%
$
2,305,688
$
30,189
5.19
%
Securities available for sale
187,119
1,540
3.27
202,829
1,478
2.89
Securities held to maturity
406,553
2,619
2.56
574,951
3,222
2.22
Nonmarketable equity securities
26,314
264
3.98
24,291
377
6.16
Interest-bearing deposits in other
banks
56,207
800
5.65
49,422
454
3.64
Total interest-earning assets
3,005,420
40,796
5.39
3,157,181
35,720
4.49
Allowance for credit losses
(30,996
)
(29,634
)
Noninterest-earning assets
223,204
218,811
Total assets
$
3,197,628
$
3,346,358
LIABILITIES AND EQUITY
Interest-bearing liabilities:
Interest-bearing deposits
$
1,788,863
$
14,311
3.17
%
$
1,627,442
$
4,433
1.08
%
Advances from FHLB and fed funds
purchased
140,761
1,915
5.40
240,489
2,408
3.97
Line of credit
4,255
95
8.86
—
—
—
Subordinated debt
46,438
534
4.56
49,806
514
4.09
Securities sold under agreements to
repurchase
23,860
128
2.13
7,634
7
0.36
Total interest-bearing liabilities
2,004,177
16,983
3.36
1,925,371
7,362
1.52
Noninterest-bearing liabilities:
Noninterest-bearing deposits
865,817
1,102,016
Accrued interest and other liabilities
33,496
26,500
Total noninterest-bearing liabilities
899,313
1,128,516
Equity
294,138
292,471
Total liabilities and equity
$
3,197,628
$
3,346,358
Net interest rate spread(2)
2.03
%
2.97
%
Net interest income
$
23,813
$
28,358
Net interest margin(3)
3.14
%
3.56
%
Net interest margin, fully taxable
equivalent(4)
3.11
%
3.57
%
(1) Includes average outstanding balances
of loans held for sale of $799,000 and $1.5 million for the quarter
ended December 31, 2023 and 2022, respectively.
(2) Net interest spread is the average
yield on interest-earning assets minus the average rate on
interest-bearing liabilities.
(3) Net interest margin is equal to net
interest income divided by average interest-earning assets,
annualized.
(4) Net interest margin on a taxable
equivalent basis is equal to net interest income adjusted for
nontaxable income divided by average interest-earning assets,
annualized, using a marginal tax rate of 21%.
Year Ended December
31,
2023
2022
(dollars in thousands)
Average Outstanding
Balance
Interest Earned/ Interest
Paid
Average Yield/ Rate
Average Outstanding
Balance
Interest Earned/ Interest
Paid
Average Yield/ Rate
ASSETS
Interest-earning assets:
Total loans(1)
$
2,352,154
$
136,086
5.79
%
$
2,126,810
$
104,503
4.91
%
Securities available for sale
182,277
5,159
2.83
287,764
5,808
2.02
Securities held to maturity
449,097
11,210
2.50
518,213
10,789
2.08
Nonmarketable equity securities
27,371
1,288
4.71
18,791
1,246
6.63
Interest-bearing deposits in other
banks
51,507
2,749
5.34
121,609
863
0.71
Total interest-earning assets
3,062,406
156,492
5.11
3,073,187
123,209
4.01
Allowance for credit losses
(31,601
)
(29,415
)
Noninterest-earning assets
220,230
216,812
Total assets
$
3,251,035
$
3,260,584
LIABILITIES AND EQUITY
Interest-bearing liabilities:
Interest-bearing deposits
$
1,698,758
$
44,981
2.65
%
$
1,670,287
$
9,753
0.58
%
Advances from FHLB and fed funds
purchased
226,214
11,626
5.14
132,764
3,855
2.90
Line of credit
4,168
363
8.71
—
34
—
Subordinated debt
47,873
2,143
4.48
46,977
1,722
3.67
Securities sold under agreements to
repurchase
20,635
399
1.93
8,596
16
0.19
Total interest-bearing liabilities
1,997,648
59,512
2.98
1,858,624
15,380
0.83
Noninterest-bearing liabilities:
Noninterest-bearing deposits
924,945
1,082,513
Accrued interest and other liabilities
30,924
25,537
Total noninterest-bearing liabilities
955,869
1,108,050
Equity
297,518
293,910
Total liabilities and equity
$
3,251,035
$
3,260,584
Net interest rate spread(2)
2.13
%
3.18
%
Net interest income
$
96,980
$
107,829
Net interest margin(3)
3.17
%
3.51
%
Net interest margin, fully taxable
equivalent(4)
3.15
%
3.54
%
(1) Includes average outstanding balances
of loans held for sale of $1.2 million and $2.4 million for the
years ended December 31, 2023 and 2022, respectively.
(2) Net interest spread is the average
yield on interest-earning assets minus the average rate on
interest-bearing liabilities.
(3) Net interest margin is equal to net
interest income divided by average interest-earning assets.
(4) Net interest margin on a taxable
equivalent basis is equal to net interest income adjusted for
nontaxable income divided by average interest-earning assets, using
a marginal tax rate of 21%.
NON-GAAP RECONCILING TABLES
Tangible Book Value per Common Share
As of
2023
2022
(dollars in thousands, except per share
data)
December 31
September 30
June 30
March 31
December 31
Equity attributable to Guaranty
Bancshares, Inc.
$
303,300
$
296,226
$
296,862
$
299,700
$
294,984
Adjustments:
Goodwill
(32,160
)
(32,160
)
(32,160
)
(32,160
)
(32,160
)
Core deposit intangible, net
(1,418
)
(1,524
)
(1,633
)
(1,746
)
(1,859
)
Total tangible common equity attributable
to Guaranty Bancshares, Inc.
$
269,722
$
262,542
$
263,069
$
265,794
$
260,965
Common shares outstanding(1)
11,540,644
11,554,094
11,603,167
11,925,357
11,941,672
Book value per common share
$
26.28
$
25.64
$
25.58
$
25.13
$
24.70
Tangible book value per common
share(1)
23.37
22.72
22.67
22.29
21.85
(1) Excludes the dilutive effect, if any,
of shares of common stock issuable upon exercise of outstanding
stock options.
Net Unrealized Loss on Securities, Tax Effected, as % of
Total Equity
(dollars in thousands)
December 31, 2023
Total equity(1)
$
303,846
Less: net unrealized loss on HTM
securities, tax effected
(23,451
)
Total equity, including net unrealized
loss on AFS and HTM securities
$
280,395
Net unrealized loss on AFS securities, tax
effected
15,156
Net unrealized loss on HTM securities, tax
effected
23,451
Net unrealized loss on AFS and HTM
securities, tax effected
$
38,607
Net unrealized loss on securities as % of
total equity(1)
12.7
%
Total equity before impact of unrealized
losses
$
319,002
Net unrealized loss on securities as % of
total equity before impact of unrealized losses
12.1
%
Total average assets
$
3,197,628
Total equity to average assets
9.5
%
Total equity, adjusted for tax effected
net unrealized loss, to average assets
8.8
%
(1) Includes the net unrealized loss on
AFS securities, tax effected, of $15,156.
Cost of Total Deposits
Quarter Ended
(dollars in thousands)
December 31, 2023
September 30, 2023
December 31, 2022
Total average interest-bearing
deposits
$
1,788,863
$
1,726,218
$
1,627,442
Adjustments:
Noninterest-bearing deposits
865,817
888,772
1,102,016
Total average deposits
$
2,654,680
$
2,614,990
$
2,729,458
Total deposit-related interest expense
$
14,311
$
13,069
$
4,433
Average cost of interest-bearing
deposits
3.17
%
3.00
%
1.08
%
Average cost of total deposits
2.14
1.98
0.64
About Non-GAAP Financial Measures
Certain of the financial measures and ratios we present,
including “tangible book value per share”, "net unrealized loss on
securities, tax effected, as a percentage of total equity" and
"cost of total deposits" are supplemental measures that are not
required by, or are not presented in accordance with, U.S.
generally accepted accounting principles (GAAP). We refer to these
financial measures and ratios as “non-GAAP financial measures.” We
consider the use of select non-GAAP financial measures and ratios
to be useful for financial and 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 or by presenting certain metrics
on a fully taxable equivalent basis. 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.
These non-GAAP financial measures should not be considered a
substitute for financial information presented in accordance with
GAAP and you should not rely on non-GAAP financial measures alone
as measures of our performance. The non-GAAP financial measures we
present may differ from non-GAAP financial measures used by our
peers or other companies. 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 non-GAAP financial measures to the
comparable GAAP financial measures is included at the end of the
financial statement tables.
Conference Call Information
The Company will hold a conference call to discuss fourth
quarter 2023 financial results on Tuesday, January 16, 2024 at
10:00 am Central Time. The conference call will be hosted by Ty
Abston, Chairman and CEO and Shalene Jacobson, EVP and CFO. All
conference attendees must register before the call at
www.gnty.com/earningscall. The conference materials will be
available by accessing the Investor Relations page on our website,
www.gnty.com. A recording of the conference call will be available
by 1:00 pm Central Time the day of the call and remain available
through January 31, 2024 on our Investor Relations webpage.
About Guaranty Bancshares, Inc.
Guaranty Bancshares, Inc. is the parent company for Guaranty
Bank & Trust, N.A. Guaranty Bank & Trust has 33 banking
locations across 26 Texas communities located within the East
Texas, Dallas/Fort Worth, Houston and Central Texas regions of the
state. As of December 31, 2023, Guaranty Bancshares, Inc. had total
assets of $3.2 billion, total loans of $2.3 billion and total
deposits of $2.6 billion. Visit www.gnty.com for more
information.
Cautionary Statement Regarding Forward-Looking
Information
This communication contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements reflect our current views
with respect to, among other things, future events and our results
of operations, financial condition and financial performance. These
statements are often, but not always, made through the use of words
or phrases such as “may,” “should,” “could,” “predict,”
“potential,” “believe,” “will likely result,” “expect,” “continue,”
“will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,”
“projection,” “would” and “outlook,” or the negative version of
those words or other comparable words of a future or
forward-looking nature. These forward-looking statements are not
historical facts, and are based on current expectations, estimates
and projections about our industry, management’s beliefs and
certain assumptions made by management, many of which, by their
nature, are inherently uncertain and beyond our control.
Accordingly, we caution you that any such forward-looking
statements are not guarantees of future performance and are subject
to risks, assumptions and uncertainties that are difficult to
predict. Although we believe that the expectations reflected in
these forward-looking statements are reasonable as of the date
made, actual results may prove to be materially different from the
results expressed or implied by the forward-looking statements.
Such factors include, without limitation, the “Risk Factors”
referenced in our most recent Annual Report on Form 10-K and any
subsequent Quarterly Reports on Form 10-Q, other risks and
uncertainties listed from time to time in our reports and documents
filed with the Securities and Exchange Commission ("SEC"). We can
give no assurance that any goal or plan or expectation set forth in
forward-looking statements can be achieved and readers are
cautioned not to place undue reliance on such statements. The
forward-looking statements are made as of the date of this
communication, and we do not intend, and assume no obligation, to
update any forward-looking statement to reflect events or
circumstances after the date on which the statement is made or to
reflect the occurrence of unanticipated events or circumstances,
except as required by applicable law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240116931859/en/
Shalene Jacobson Executive Vice President and Chief Financial
Officer Guaranty Bancshares, Inc. (888) 572-9881
investors@gnty.com
Guaranty Bancshares (NYSE:GNTY)
Historical Stock Chart
From Aug 2024 to Sep 2024
Guaranty Bancshares (NYSE:GNTY)
Historical Stock Chart
From Sep 2023 to Sep 2024