UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
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(Registrant’s telephone number, including area code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2b) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
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Item 2.02. Results of Operations and Financial Condition
On January 21, 2020, Triumph Bancorp, Inc. (the “Company”) issued a press release that announced its 2019 fourth quarter earnings. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference herein. This press release includes certain non-GAAP financial measures. A reconciliation of those measures to the most directly comparable GAAP measures is included as a table in the press release. The information in this Item 2.02, including Exhibit 99.1, shall be considered furnished for purposes of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be deemed “filed” for any purpose.
Item 7.01.Regulation FD Disclosure
In addition, this Form 8-K includes a copy of the Company’s presentation to analysts and investors for its quarter ended December 31, 2019, which is attached hereto as Exhibit 99.2. The information in this Item 7.01, including Exhibit 99.2, shall be considered furnished for purposes of the Exchange Act and shall not be deemed “filed” for any purpose.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; risks related to the integration of acquired businesses (including our acquisitions of First Bancorp of Durango, Inc., Southern Colorado Corp., and the operating assets of Interstate Capital Corporation and certain of its affiliates) and any future acquisitions; changes in management personnel; interest rate risk; concentration of our factoring services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets, or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally, or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities, and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of the Federal Deposit Insurance Corporation insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.
While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake 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. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see “Risk Factors” and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 12, 2019.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
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Exhibit |
Description |
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99.1 |
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99.2 |
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104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
EXHIBIT INDEX
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Exhibit |
Description |
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99.1 |
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99.2 |
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104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
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TRIUMPH BANCORP, INC.
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By: |
/s/ Adam D. Nelson |
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Name: Adam D. Nelson Title: Executive Vice President & General Counsel |
Date: January 21, 2020
Exhibit 99.1
Triumph Bancorp Reports Fourth Quarter Net Income to Common Stockholders of $16.7 Million
DALLAS – January 21, 2020 (GLOBE NEWSWIRE) – Triumph Bancorp, Inc. (Nasdaq: TBK) (“Triumph” or the “Company”) today announced earnings and operating results for the fourth quarter of 2019.
As part of how we measure our results, we use certain non-GAAP financial measures to ascertain performance. These non-GAAP financial measures are reconciled in the section labeled “Metrics and non-GAAP financial reconciliation” at the end of this press release.
2019 Fourth Quarter Highlights and Recent Developments
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For the fourth quarter of 2019, net income available to common stockholders was $16.7 million. Diluted earnings per share were $0.66. |
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Net interest margin (“NIM”) was 5.72% for the quarter ended December 31, 2019. |
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Total loans held for investment decreased $14.9 million, or 0.4%, to $4.195 billion at December 31, 2019. Average loans for the quarter increased $190.7 million, or 4.8%, to $4.134 billion. |
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The total dollar value of invoices purchased by Triumph Business Capital for the quarter ended December 31, 2019 was $1.490 billion with an average invoice size of $1,662. The transportation average invoice size for the quarter was $1,507. |
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For the quarter ended December 31, 2019, TriumphPay processed 442,428 invoices paying 41,222 distinct carriers a total of $474.9 million. |
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During the quarter ended December 31, 2019, we completed a $39.5 million subordinated debt offering. |
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During the quarter ended December 31, 2019, we repurchased 392,557 shares into treasury stock under our stock repurchase program at an average price of $36.69, for a total of $14.4 million. During the year ended December 31, 2019, we have repurchased 2,080,791 shares into treasury stock under our stock repurchase programs at an average price of $30.90, for a total of $64.4 million. |
Balance Sheet
Total loans held for investment decreased $14.9 million, or 0.4%, during the fourth quarter to $4.195 billion at December 31, 2019. The community banking portfolio decreased $113.0 million, or 5.1%, to $2.094 billion, the commercial finance portfolio decreased $25.6 million, or 2.0%, to $1.250 billion, and the national lending portfolio increased $123.7 million, or 17.0%, to $850.4 million during the quarter.
Total deposits were $3.790 billion at December 31, 2019, an increase of $92.1 million, or 2.5%, in the fourth quarter of 2019. Non-interest-bearing deposits accounted for 21% of total deposits and non-time deposits accounted for 59% of total deposits at December 31, 2019.
Net Interest Income
We earned net interest income for the quarter ended December 31, 2019 of $66.4 million compared to $64.8 million for the quarter ended September 30, 2019.
Yields on loans for the quarter ended December 31, 2019 were down 15 bps from the prior quarter to 7.48%. The average cost of our total deposits was 1.15% for the quarter ended December 31, 2019 compared to 1.19% for the quarter ended September 30, 2019.
Asset Quality
Non-performing assets were 0.87% of total assets at December 31, 2019 compared to 0.91% of total assets at September 30, 2019. The ratio of past due to total loans decreased to 2.19% at December 31, 2019 from 2.47% at September 30, 2019. We recorded total net charge-offs of $3.2 million, or 0.08% of average loans, for the quarter ended December 31, 2019 compared to net charge-offs of $0.4 million, or 0.01% of average loans, for the quarter ended September 30, 2019.
1
We recorded a provision for loan losses of $0.4 million for the quarter ended December 31, 2019 compared to a provision of $2.9 million for the quarter ended September 30, 2019. From September 30, 2019 to December 31, 2019, our ALLL decreased from $31.9 million or 0.76% of total loans to $29.1 million or 0.69% of total loans.
Non-Interest Income and Expense
We earned non-interest income for the quarter ended December 31, 2019 of $8.7 million compared to $7.7 million for the quarter ended September 30, 2019.
For the quarter ended December 31, 2019, non-interest expense totaled $52.7 million, compared to $52.2 million for the quarter ended September 30, 2019.
Conference Call Information
Aaron P. Graft, Vice Chairman and CEO and Bryce Fowler, CFO will review the quarterly results in a conference call for investors and analysts beginning at 5:00 p.m. Central Time on Tuesday, January 21, 2020. Todd Ritterbusch, Chief Lending Officer, will also be available for questions.
To participate in the live conference call, please dial 1-855-940-9472 (Canada: 1-855-669-9657) and request to be joined into the Triumph Bancorp, Inc. call. A simultaneous audio-only webcast may be accessed via the Company's website at www.triumphbancorp.com through the Investor Relations, News & Events, Webcasts and Presentations links, or through a direct link here at: https://services.choruscall.com/links/tbk200121.html. An archive of this conference call will subsequently be available at this same location on the Company’s website.
2
Triumph Bancorp, Inc. (Nasdaq: TBK) is a financial holding company headquartered in Dallas, Texas. Triumph offers a diversified line of community banking, national lending, and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com
Forward-Looking Statements
This press release contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; risks related to the integration of acquired businesses (including our acquisitions of First Bancorp of Durango, Inc., Southern Colorado Corp., and the operating assets of Interstate Capital Corporation and certain of its affiliates) and any future acquisitions; changes in management personnel; interest rate risk; concentration of our factoring services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets, or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally, or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities, and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of the Federal Deposit Insurance Corporation insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.
While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake 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. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 12, 2019.
Non-GAAP Financial Measures
This press release includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided at the end of this press release.
3
The following table sets forth key metrics used by Triumph to monitor our operations. Footnotes in this table can be found in our definitions of non-GAAP financial measures at the end of this document.
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As of and for the Three Months Ended |
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As of and for the Years Ended |
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December 31, |
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September 30, |
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June 30, |
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March 31, |
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December 31, |
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December 31, |
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December 31, |
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(Dollars in thousands) |
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2019 |
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2019 |
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2019 |
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2019 |
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2018 |
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2019 |
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2018 |
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Financial Highlights: |
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Total assets |
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$ |
5,060,297 |
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$ |
5,039,697 |
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$ |
4,783,189 |
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$ |
4,529,783 |
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$ |
4,559,779 |
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$ |
5,060,297 |
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$ |
4,559,779 |
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Loans held for investment |
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$ |
4,194,512 |
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$ |
4,209,417 |
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$ |
3,835,903 |
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$ |
3,612,869 |
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$ |
3,608,644 |
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$ |
4,194,512 |
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$ |
3,608,644 |
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Deposits |
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$ |
3,789,906 |
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$ |
3,697,833 |
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$ |
3,658,978 |
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$ |
3,314,440 |
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$ |
3,450,349 |
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$ |
3,789,906 |
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$ |
3,450,349 |
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Net income available to common stockholders |
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$ |
16,709 |
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$ |
14,317 |
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$ |
12,730 |
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$ |
14,788 |
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$ |
18,085 |
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$ |
58,544 |
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$ |
51,130 |
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Performance Ratios - Annualized: |
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Return on average assets |
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1.31 |
% |
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1.17 |
% |
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1.09 |
% |
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1.33 |
% |
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1.60 |
% |
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1.23 |
% |
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1.33 |
% |
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Return on average total equity |
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10.24 |
% |
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8.79 |
% |
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7.83 |
% |
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9.30 |
% |
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11.35 |
% |
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9.04 |
% |
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9.24 |
% |
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Return on average common equity |
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10.24 |
% |
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8.79 |
% |
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7.83 |
% |
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9.30 |
% |
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11.40 |
% |
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9.04 |
% |
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9.27 |
% |
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Return on average tangible common equity (1) |
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14.54 |
% |
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12.56 |
% |
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11.19 |
% |
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13.43 |
% |
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16.73 |
% |
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12.93 |
% |
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11.90 |
% |
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Yield on loans(2) |
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7.48 |
% |
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7.63 |
% |
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7.95 |
% |
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7.99 |
% |
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8.14 |
% |
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7.75 |
% |
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8.07 |
% |
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Cost of interest bearing deposits |
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1.45 |
% |
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1.49 |
% |
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1.42 |
% |
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1.24 |
% |
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1.15 |
% |
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1.40 |
% |
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1.02 |
% |
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Cost of total deposits |
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1.15 |
% |
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1.19 |
% |
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1.14 |
% |
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0.99 |
% |
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0.91 |
% |
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1.12 |
% |
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0.80 |
% |
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Cost of total funds |
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1.35 |
% |
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1.41 |
% |
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1.40 |
% |
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1.28 |
% |
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1.14 |
% |
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1.36 |
% |
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1.09 |
% |
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Net interest margin(2) |
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5.72 |
% |
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5.85 |
% |
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5.99 |
% |
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6.15 |
% |
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6.34 |
% |
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5.92 |
% |
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6.35 |
% |
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Net non-interest expense to average assets |
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3.46 |
% |
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3.64 |
% |
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3.68 |
% |
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3.70 |
% |
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3.55 |
% |
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3.61 |
% |
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3.70 |
% |
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Adjusted net non-interest expense to average assets (1) |
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3.46 |
% |
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3.64 |
% |
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3.68 |
% |
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3.70 |
% |
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3.55 |
% |
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3.61 |
% |
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3.55 |
% |
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Efficiency ratio |
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70.15 |
% |
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71.93 |
% |
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71.37 |
% |
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70.54 |
% |
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65.52 |
% |
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70.99 |
% |
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66.94 |
% |
|
Adjusted efficiency ratio (1) |
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70.15 |
% |
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71.93 |
% |
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71.37 |
% |
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70.54 |
% |
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65.52 |
% |
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70.99 |
% |
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64.43 |
% |
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Asset Quality:(3) |
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Past due to total loans |
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2.19 |
% |
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2.47 |
% |
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1.90 |
% |
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2.33 |
% |
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2.41 |
% |
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2.19 |
% |
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2.41 |
% |
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Non-performing loans to total loans |
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0.97 |
% |
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1.00 |
% |
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0.96 |
% |
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0.95 |
% |
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1.00 |
% |
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0.97 |
% |
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|
1.00 |
% |
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Non-performing assets to total assets |
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0.87 |
% |
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0.91 |
% |
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0.86 |
% |
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0.84 |
% |
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0.84 |
% |
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0.87 |
% |
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0.84 |
% |
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ALLL to non-performing loans |
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71.63 |
% |
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75.58 |
% |
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79.91 |
% |
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80.70 |
% |
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76.47 |
% |
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71.63 |
% |
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76.47 |
% |
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ALLL to total loans |
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0.69 |
% |
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0.76 |
% |
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0.77 |
% |
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0.76 |
% |
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0.76 |
% |
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0.69 |
% |
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0.76 |
% |
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Net charge-offs to average loans |
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0.08 |
% |
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0.01 |
% |
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0.05 |
% |
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0.03 |
% |
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0.05 |
% |
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0.17 |
% |
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0.23 |
% |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1 capital to average assets(4) |
|
|
10.03 |
% |
|
|
10.37 |
% |
|
|
10.84 |
% |
|
|
11.32 |
% |
|
|
11.08 |
% |
|
|
10.03 |
% |
|
|
11.08 |
% |
|
Tier 1 capital to risk-weighted assets(4) |
|
|
10.29 |
% |
|
|
10.08 |
% |
|
|
11.08 |
% |
|
|
11.76 |
% |
|
|
11.49 |
% |
|
|
10.29 |
% |
|
|
11.49 |
% |
|
Common equity tier 1 capital to risk-weighted assets(4) |
|
|
9.45 |
% |
|
|
9.26 |
% |
|
|
10.19 |
% |
|
|
10.81 |
% |
|
|
10.55 |
% |
|
|
9.45 |
% |
|
|
10.55 |
% |
|
Total capital to risk-weighted assets(4) |
|
|
12.75 |
% |
|
|
11.79 |
% |
|
|
12.88 |
% |
|
|
13.62 |
% |
|
|
13.35 |
% |
|
|
12.75 |
% |
|
|
13.35 |
% |
|
Total equity to total assets |
|
|
12.58 |
% |
|
|
12.57 |
% |
|
|
13.45 |
% |
|
|
14.27 |
% |
|
|
13.96 |
% |
|
|
12.58 |
% |
|
|
13.96 |
% |
|
Tangible common stockholders' equity to tangible assets(1) |
|
|
9.16 |
% |
|
|
9.10 |
% |
|
|
9.78 |
% |
|
|
10.37 |
% |
|
|
10.03 |
% |
|
|
9.16 |
% |
|
|
10.03 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per Share Amounts: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per share |
|
$ |
25.50 |
|
|
$ |
24.99 |
|
|
$ |
24.56 |
|
|
$ |
24.19 |
|
|
$ |
23.62 |
|
|
$ |
25.50 |
|
|
$ |
23.62 |
|
|
Tangible book value per share (1) |
|
$ |
17.88 |
|
|
$ |
17.40 |
|
|
$ |
17.13 |
|
|
$ |
16.82 |
|
|
$ |
16.22 |
|
|
$ |
17.88 |
|
|
$ |
16.22 |
|
|
Basic earnings per common share |
|
$ |
0.67 |
|
|
$ |
0.56 |
|
|
$ |
0.48 |
|
|
$ |
0.55 |
|
|
$ |
0.68 |
|
|
$ |
2.26 |
|
|
$ |
2.06 |
|
|
Diluted earnings per common share |
|
$ |
0.66 |
|
|
$ |
0.56 |
|
|
$ |
0.48 |
|
|
$ |
0.55 |
|
|
$ |
0.67 |
|
|
$ |
2.25 |
|
|
$ |
2.03 |
|
|
Adjusted diluted earnings per common share(1) |
|
$ |
0.66 |
|
|
$ |
0.56 |
|
|
$ |
0.48 |
|
|
$ |
0.55 |
|
|
$ |
0.67 |
|
|
$ |
2.25 |
|
|
$ |
2.21 |
|
|
Shares outstanding end of period |
|
|
24,964,961 |
|
|
|
25,357,985 |
|
|
|
26,198,308 |
|
|
|
26,709,411 |
|
|
|
26,949,936 |
|
|
|
24,964,961 |
|
|
|
26,949,936 |
|
4
Unaudited consolidated balance sheet as of:
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|||||
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cash and cash equivalents |
|
$ |
197,880 |
|
|
$ |
115,043 |
|
|
$ |
209,305 |
|
|
$ |
171,950 |
|
|
$ |
234,939 |
|
|
Securities - available for sale |
|
|
248,820 |
|
|
|
302,917 |
|
|
|
329,991 |
|
|
|
339,465 |
|
|
|
336,423 |
|
|
Securities - held to maturity |
|
|
8,417 |
|
|
|
8,517 |
|
|
|
8,573 |
|
|
|
8,499 |
|
|
|
8,487 |
|
|
Equity securities |
|
|
5,437 |
|
|
|
5,543 |
|
|
|
5,479 |
|
|
|
5,183 |
|
|
|
5,044 |
|
|
Loans held for sale |
|
|
2,735 |
|
|
|
7,499 |
|
|
|
2,877 |
|
|
|
610 |
|
|
|
2,106 |
|
|
Loans held for investment |
|
|
4,194,512 |
|
|
|
4,209,417 |
|
|
|
3,835,903 |
|
|
|
3,612,869 |
|
|
|
3,608,644 |
|
|
Allowance for loan and lease losses |
|
|
(29,092 |
) |
|
|
(31,895 |
) |
|
|
(29,416 |
) |
|
|
(27,605 |
) |
|
|
(27,571 |
) |
|
Loans, net |
|
|
4,165,420 |
|
|
|
4,177,522 |
|
|
|
3,806,487 |
|
|
|
3,585,264 |
|
|
|
3,581,073 |
|
|
FHLB and other restricted stock |
|
|
19,860 |
|
|
|
23,960 |
|
|
|
18,037 |
|
|
|
21,191 |
|
|
|
15,943 |
|
|
Premises and equipment, net |
|
|
96,595 |
|
|
|
87,112 |
|
|
|
84,998 |
|
|
|
84,931 |
|
|
|
83,392 |
|
|
Other real estate owned ("OREO"), net |
|
|
3,009 |
|
|
|
2,849 |
|
|
|
3,351 |
|
|
|
3,073 |
|
|
|
2,060 |
|
|
Goodwill and intangible assets, net |
|
|
190,286 |
|
|
|
192,440 |
|
|
|
194,668 |
|
|
|
197,015 |
|
|
|
199,417 |
|
|
Bank-owned life insurance |
|
|
40,954 |
|
|
|
40,724 |
|
|
|
40,847 |
|
|
|
40,667 |
|
|
|
40,509 |
|
|
Deferred tax asset, net |
|
|
3,812 |
|
|
|
5,971 |
|
|
|
7,278 |
|
|
|
7,608 |
|
|
|
8,438 |
|
|
Other assets |
|
|
77,072 |
|
|
|
69,600 |
|
|
|
71,298 |
|
|
|
64,327 |
|
|
|
41,948 |
|
|
Total assets |
|
$ |
5,060,297 |
|
|
$ |
5,039,697 |
|
|
$ |
4,783,189 |
|
|
$ |
4,529,783 |
|
|
$ |
4,559,779 |
|
|
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing deposits |
|
$ |
809,696 |
|
|
$ |
754,233 |
|
|
$ |
684,223 |
|
|
$ |
667,597 |
|
|
$ |
724,527 |
|
|
Interest bearing deposits |
|
|
2,980,210 |
|
|
|
2,943,600 |
|
|
|
2,974,755 |
|
|
|
2,646,843 |
|
|
|
2,725,822 |
|
|
Total deposits |
|
|
3,789,906 |
|
|
|
3,697,833 |
|
|
|
3,658,978 |
|
|
|
3,314,440 |
|
|
|
3,450,349 |
|
|
Customer repurchase agreements |
|
|
2,033 |
|
|
|
14,124 |
|
|
|
12,788 |
|
|
|
3,727 |
|
|
|
4,485 |
|
|
Federal Home Loan Bank advances |
|
|
430,000 |
|
|
|
530,000 |
|
|
|
305,000 |
|
|
|
405,000 |
|
|
|
330,000 |
|
|
Subordinated notes |
|
|
87,327 |
|
|
|
49,010 |
|
|
|
48,983 |
|
|
|
48,956 |
|
|
|
48,929 |
|
|
Junior subordinated debentures |
|
|
39,566 |
|
|
|
39,443 |
|
|
|
39,320 |
|
|
|
39,200 |
|
|
|
39,083 |
|
|
Other liabilities |
|
|
74,875 |
|
|
|
75,594 |
|
|
|
74,758 |
|
|
|
72,244 |
|
|
|
50,326 |
|
|
Total liabilities |
|
|
4,423,707 |
|
|
|
4,406,004 |
|
|
|
4,139,827 |
|
|
|
3,883,567 |
|
|
|
3,923,172 |
|
|
EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock |
|
|
272 |
|
|
|
272 |
|
|
|
271 |
|
|
|
271 |
|
|
|
271 |
|
|
Additional paid-in-capital |
|
|
473,251 |
|
|
|
472,368 |
|
|
|
471,145 |
|
|
|
470,292 |
|
|
|
469,341 |
|
|
Treasury stock, at cost |
|
|
(67,069 |
) |
|
|
(52,632 |
) |
|
|
(27,468 |
) |
|
|
(9,881 |
) |
|
|
(2,288 |
) |
|
Retained earnings |
|
|
229,030 |
|
|
|
212,321 |
|
|
|
198,004 |
|
|
|
185,274 |
|
|
|
170,486 |
|
|
Accumulated other comprehensive income |
|
|
1,106 |
|
|
|
1,364 |
|
|
|
1,410 |
|
|
|
260 |
|
|
|
(1,203 |
) |
|
Total stockholders' equity |
|
|
636,590 |
|
|
|
633,693 |
|
|
|
643,362 |
|
|
|
646,216 |
|
|
|
636,607 |
|
|
Total liabilities and equity |
|
$ |
5,060,297 |
|
|
$ |
5,039,697 |
|
|
$ |
4,783,189 |
|
|
$ |
4,529,783 |
|
|
$ |
4,559,779 |
|
5
Unaudited consolidated statement of income:
|
|
|
For the Three Months Ended |
|
|
For the Years Ended |
|
||||||||||||||||||||||
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|
December 31, |
|
|
December 31, |
|
|||||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|||||||
|
Interest income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, including fees |
|
$ |
52,395 |
|
|
$ |
50,249 |
|
|
$ |
47,910 |
|
|
$ |
45,094 |
|
|
$ |
44,435 |
|
|
$ |
195,648 |
|
|
$ |
160,723 |
|
|
Factored receivables, including fees |
|
|
25,573 |
|
|
|
25,570 |
|
|
|
25,558 |
|
|
|
24,556 |
|
|
|
28,070 |
|
|
|
101,257 |
|
|
|
92,103 |
|
|
Securities |
|
|
2,379 |
|
|
|
2,784 |
|
|
|
2,667 |
|
|
|
2,644 |
|
|
|
2,314 |
|
|
|
10,474 |
|
|
|
6,354 |
|
|
FHLB and other restricted stock |
|
|
165 |
|
|
|
209 |
|
|
|
146 |
|
|
|
192 |
|
|
|
154 |
|
|
|
712 |
|
|
|
507 |
|
|
Cash deposits |
|
|
659 |
|
|
|
603 |
|
|
|
1,022 |
|
|
|
778 |
|
|
|
877 |
|
|
|
3,062 |
|
|
|
3,289 |
|
|
Total interest income |
|
|
81,171 |
|
|
|
79,415 |
|
|
|
77,303 |
|
|
|
73,264 |
|
|
|
75,850 |
|
|
|
311,153 |
|
|
|
262,976 |
|
|
Interest expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
10,961 |
|
|
|
11,036 |
|
|
|
10,010 |
|
|
|
8,218 |
|
|
|
7,931 |
|
|
|
40,225 |
|
|
|
23,058 |
|
|
Subordinated notes |
|
|
1,035 |
|
|
|
840 |
|
|
|
839 |
|
|
|
839 |
|
|
|
839 |
|
|
|
3,553 |
|
|
|
3,351 |
|
|
Junior subordinated debentures |
|
|
687 |
|
|
|
719 |
|
|
|
744 |
|
|
|
760 |
|
|
|
717 |
|
|
|
2,910 |
|
|
|
2,741 |
|
|
Other borrowings |
|
|
2,080 |
|
|
|
2,055 |
|
|
|
2,291 |
|
|
|
2,136 |
|
|
|
1,482 |
|
|
|
8,562 |
|
|
|
6,776 |
|
|
Total interest expense |
|
|
14,763 |
|
|
|
14,650 |
|
|
|
13,884 |
|
|
|
11,953 |
|
|
|
10,969 |
|
|
|
55,250 |
|
|
|
35,926 |
|
|
Net interest income |
|
|
66,408 |
|
|
|
64,765 |
|
|
|
63,419 |
|
|
|
61,311 |
|
|
|
64,881 |
|
|
|
255,903 |
|
|
|
227,050 |
|
|
Provision for loan losses |
|
|
382 |
|
|
|
2,865 |
|
|
|
3,681 |
|
|
|
1,014 |
|
|
|
1,910 |
|
|
|
7,942 |
|
|
|
16,167 |
|
|
Net interest income after provision for loan losses |
|
|
66,026 |
|
|
|
61,900 |
|
|
|
59,738 |
|
|
|
60,297 |
|
|
|
62,971 |
|
|
|
247,961 |
|
|
|
210,883 |
|
|
Non-interest income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service charges on deposits |
|
|
1,889 |
|
|
|
1,937 |
|
|
|
1,700 |
|
|
|
1,606 |
|
|
|
1,702 |
|
|
|
7,132 |
|
|
|
5,469 |
|
|
Card income |
|
|
1,943 |
|
|
|
2,015 |
|
|
|
2,071 |
|
|
|
1,844 |
|
|
|
1,999 |
|
|
|
7,873 |
|
|
|
6,514 |
|
|
Net OREO gains (losses) and valuation adjustments |
|
|
50 |
|
|
|
(56 |
) |
|
|
148 |
|
|
|
209 |
|
|
|
37 |
|
|
|
351 |
|
|
|
(514 |
) |
|
Net gains (losses) on sale of securities |
|
|
39 |
|
|
|
19 |
|
|
|
14 |
|
|
|
(11 |
) |
|
|
— |
|
|
|
61 |
|
|
|
(272 |
) |
|
Fee income |
|
|
1,686 |
|
|
|
1,624 |
|
|
|
1,519 |
|
|
|
1,612 |
|
|
|
1,636 |
|
|
|
6,441 |
|
|
|
5,150 |
|
|
Insurance commissions |
|
|
1,092 |
|
|
|
1,247 |
|
|
|
961 |
|
|
|
919 |
|
|
|
846 |
|
|
|
4,219 |
|
|
|
3,492 |
|
|
Gain on sale of subsidiary |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,071 |
|
|
Other |
|
|
1,967 |
|
|
|
956 |
|
|
|
1,210 |
|
|
|
1,359 |
|
|
|
574 |
|
|
|
5,492 |
|
|
|
2,060 |
|
|
Total non-interest income |
|
|
8,666 |
|
|
|
7,742 |
|
|
|
7,623 |
|
|
|
7,538 |
|
|
|
6,794 |
|
|
|
31,569 |
|
|
|
22,970 |
|
|
Non-interest expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
|
29,586 |
|
|
|
28,717 |
|
|
|
28,120 |
|
|
|
26,439 |
|
|
|
25,586 |
|
|
|
112,862 |
|
|
|
90,212 |
|
|
Occupancy, furniture and equipment |
|
|
4,667 |
|
|
|
4,505 |
|
|
|
4,502 |
|
|
|
4,522 |
|
|
|
4,402 |
|
|
|
18,196 |
|
|
|
14,023 |
|
|
FDIC insurance and other regulatory assessments |
|
|
(302 |
) |
|
|
(2 |
) |
|
|
303 |
|
|
|
299 |
|
|
|
184 |
|
|
|
298 |
|
|
|
1,129 |
|
|
Professional fees |
|
|
1,904 |
|
|
|
1,969 |
|
|
|
1,550 |
|
|
|
1,865 |
|
|
|
1,837 |
|
|
|
7,288 |
|
|
|
8,939 |
|
|
Amortization of intangible assets |
|
|
2,154 |
|
|
|
2,228 |
|
|
|
2,347 |
|
|
|
2,402 |
|
|
|
2,438 |
|
|
|
9,131 |
|
|
|
6,980 |
|
|
Advertising and promotion |
|
|
1,347 |
|
|
|
1,379 |
|
|
|
1,796 |
|
|
|
1,604 |
|
|
|
1,036 |
|
|
|
6,126 |
|
|
|
4,974 |
|
|
Communications and technology |
|
|
5,732 |
|
|
|
5,382 |
|
|
|
4,988 |
|
|
|
4,874 |
|
|
|
4,388 |
|
|
|
20,976 |
|
|
|
18,270 |
|
|
Other |
|
|
7,573 |
|
|
|
7,975 |
|
|
|
7,098 |
|
|
|
6,561 |
|
|
|
7,091 |
|
|
|
29,207 |
|
|
|
22,826 |
|
|
Total non-interest expense |
|
|
52,661 |
|
|
|
52,153 |
|
|
|
50,704 |
|
|
|
48,566 |
|
|
|
46,962 |
|
|
|
204,084 |
|
|
|
167,353 |
|
|
Net income before income tax |
|
|
22,031 |
|
|
|
17,489 |
|
|
|
16,657 |
|
|
|
19,269 |
|
|
|
22,803 |
|
|
|
75,446 |
|
|
|
66,500 |
|
|
Income tax expense |
|
|
5,322 |
|
|
|
3,172 |
|
|
|
3,927 |
|
|
|
4,481 |
|
|
|
4,718 |
|
|
|
16,902 |
|
|
|
14,792 |
|
|
Net income |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
51,708 |
|
|
Dividends on preferred stock |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(578 |
) |
|
Net income available to common stockholders |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
51,130 |
|
6
|
|
|
For the Three Months Ended |
|
|
For the Years Ended |
|
||||||||||||||||||||||
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|
December 31, |
|
|
December 31, |
|
|||||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|||||||
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income to common stockholders |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
51,130 |
|
|
Weighted average common shares outstanding |
|
|
25,089,447 |
|
|
|
25,621,054 |
|
|
|
26,396,351 |
|
|
|
26,679,724 |
|
|
|
26,666,554 |
|
|
|
25,941,395 |
|
|
|
24,791,448 |
|
|
Basic earnings per common share |
|
$ |
0.67 |
|
|
$ |
0.56 |
|
|
$ |
0.48 |
|
|
$ |
0.55 |
|
|
$ |
0.68 |
|
|
$ |
2.26 |
|
|
$ |
2.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income to common stockholders |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
51,130 |
|
|
Dilutive effect of preferred stock |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
578 |
|
|
Net income to common stockholders - diluted |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
51,708 |
|
|
Weighted average common shares outstanding |
|
|
25,089,447 |
|
|
|
25,621,054 |
|
|
|
26,396,351 |
|
|
|
26,679,724 |
|
|
|
26,666,554 |
|
|
|
25,941,395 |
|
|
|
24,791,448 |
|
|
Dilutive effects of: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assumed conversion of Preferred A |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
89,240 |
|
|
|
— |
|
|
|
258,674 |
|
|
Assumed conversion of Preferred B |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
100,176 |
|
|
|
— |
|
|
|
290,375 |
|
|
Assumed exercises of stock options |
|
|
69,865 |
|
|
|
60,068 |
|
|
|
59,962 |
|
|
|
64,166 |
|
|
|
76,219 |
|
|
|
63,808 |
|
|
|
84,126 |
|
|
Restricted stock awards |
|
|
70,483 |
|
|
|
45,631 |
|
|
|
30,110 |
|
|
|
49,795 |
|
|
|
46,457 |
|
|
|
47,242 |
|
|
|
52,851 |
|
|
Restricted stock units |
|
|
13,264 |
|
|
|
3,045 |
|
|
|
— |
|
|
|
— |
|
|
|
1,303 |
|
|
|
3,441 |
|
|
|
3,039 |
|
|
Performance stock units - market based |
|
|
11,803 |
|
|
|
4,673 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,119 |
|
|
|
— |
|
|
Performance stock units - performance based |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Weighted average shares outstanding - diluted |
|
|
25,254,862 |
|
|
|
25,734,471 |
|
|
|
26,486,423 |
|
|
|
26,793,685 |
|
|
|
26,979,949 |
|
|
|
26,060,005 |
|
|
|
25,480,513 |
|
|
Diluted earnings per common share |
|
$ |
0.66 |
|
|
$ |
0.56 |
|
|
$ |
0.48 |
|
|
$ |
0.55 |
|
|
$ |
0.67 |
|
|
$ |
2.25 |
|
|
$ |
2.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares that were not considered in computing diluted earnings per common share because they were antidilutive are as follows: |
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Years Ended |
|
||||||||||||||||||||||
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|
December 31, |
|
|
December 31, |
|
|||||||
|
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|||||||
|
Assumed conversion of Preferred A |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Assumed conversion of Preferred B |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Stock options |
|
|
66,019 |
|
|
|
67,023 |
|
|
|
70,037 |
|
|
|
50,752 |
|
|
|
51,952 |
|
|
|
66,019 |
|
|
|
51,952 |
|
|
Restricted stock awards |
|
|
— |
|
|
|
3,209 |
|
|
|
— |
|
|
|
13,290 |
|
|
|
14,513 |
|
|
|
— |
|
|
|
— |
|
|
Restricted stock units |
|
|
— |
|
|
|
— |
|
|
|
58,400 |
|
|
|
58,400 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Performance stock units - market based |
|
|
55,228 |
|
|
|
55,228 |
|
|
|
70,879 |
|
|
|
58,400 |
|
|
|
59,658 |
|
|
|
55,228 |
|
|
|
59,658 |
|
|
Performance stock units - performance based |
|
|
254,000 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
254,000 |
|
|
|
— |
|
7
Loans held for investment summarized as of:
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|||||
|
Commercial real estate |
|
$ |
1,046,961 |
|
|
$ |
1,115,559 |
|
|
$ |
1,098,279 |
|
|
$ |
1,093,882 |
|
|
$ |
992,080 |
|
|
Construction, land development, land |
|
|
160,569 |
|
|
|
164,186 |
|
|
|
157,861 |
|
|
|
145,002 |
|
|
|
179,591 |
|
|
1-4 family residential properties |
|
|
179,425 |
|
|
|
186,405 |
|
|
|
186,070 |
|
|
|
194,067 |
|
|
|
190,185 |
|
|
Farmland |
|
|
154,975 |
|
|
|
161,447 |
|
|
|
144,594 |
|
|
|
156,299 |
|
|
|
170,540 |
|
|
Commercial |
|
|
1,342,683 |
|
|
|
1,369,505 |
|
|
|
1,257,330 |
|
|
|
1,117,640 |
|
|
|
1,114,971 |
|
|
Factored receivables |
|
|
619,986 |
|
|
|
599,651 |
|
|
|
583,131 |
|
|
|
570,663 |
|
|
|
617,791 |
|
|
Consumer |
|
|
21,925 |
|
|
|
24,967 |
|
|
|
26,048 |
|
|
|
27,941 |
|
|
|
29,822 |
|
|
Mortgage warehouse |
|
|
667,988 |
|
|
|
587,697 |
|
|
|
382,590 |
|
|
|
307,375 |
|
|
|
313,664 |
|
|
Total loans |
|
$ |
4,194,512 |
|
|
$ |
4,209,417 |
|
|
$ |
3,835,903 |
|
|
$ |
3,612,869 |
|
|
$ |
3,608,644 |
|
Our total loans held for investment portfolio consists of traditional community bank loans as well as commercial finance product lines focused on businesses that require specialized financial solutions and national lending product lines that further diversify our lending operations.
Commercial finance loans are further summarized below:
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|||||
|
Commercial - Equipment |
|
$ |
461,555 |
|
|
$ |
429,412 |
|
|
$ |
395,094 |
|
|
$ |
364,447 |
|
|
$ |
352,037 |
|
|
Commercial - Asset-based lending |
|
|
168,955 |
|
|
|
247,026 |
|
|
|
208,896 |
|
|
|
174,447 |
|
|
|
214,110 |
|
|
Factored receivables |
|
|
619,986 |
|
|
|
599,651 |
|
|
|
583,131 |
|
|
|
570,663 |
|
|
|
617,791 |
|
|
Commercial finance |
|
$ |
1,250,496 |
|
|
$ |
1,276,089 |
|
|
$ |
1,187,121 |
|
|
$ |
1,109,557 |
|
|
$ |
1,183,938 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial finance % of total loans |
|
|
30 |
% |
|
|
30 |
% |
|
|
31 |
% |
|
|
31 |
% |
|
|
33 |
% |
National lending loans are further summarized below:
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|||||
|
Mortgage warehouse |
|
$ |
667,988 |
|
|
$ |
587,697 |
|
|
$ |
382,590 |
|
|
$ |
307,375 |
|
|
$ |
313,664 |
|
|
Commercial - Liquid credit |
|
|
81,353 |
|
|
|
37,386 |
|
|
|
21,758 |
|
|
|
960 |
|
|
|
963 |
|
|
Commercial - Premium finance |
|
|
101,015 |
|
|
|
101,562 |
|
|
|
72,898 |
|
|
|
77,389 |
|
|
|
72,302 |
|
|
National lending |
|
$ |
850,356 |
|
|
$ |
726,645 |
|
|
$ |
477,246 |
|
|
$ |
385,724 |
|
|
$ |
386,929 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
National lending % of total loans |
|
|
20 |
% |
|
|
17 |
% |
|
|
12 |
% |
|
|
11 |
% |
|
|
11 |
% |
Additional information pertaining to our loan portfolio, summarized for the quarters ended:
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|||||
|
Average community banking |
|
$ |
2,170,149 |
|
|
$ |
2,193,533 |
|
|
$ |
2,166,122 |
|
|
$ |
2,103,816 |
|
|
$ |
2,012,255 |
|
|
Average commercial finance |
|
|
1,260,000 |
|
|
|
1,208,823 |
|
|
|
1,168,110 |
|
|
|
1,123,978 |
|
|
|
1,190,586 |
|
|
Average national lending |
|
|
704,244 |
|
|
|
541,367 |
|
|
|
373,755 |
|
|
|
307,249 |
|
|
|
329,630 |
|
|
Average total loans |
|
$ |
4,134,393 |
|
|
$ |
3,943,723 |
|
|
$ |
3,707,987 |
|
|
$ |
3,535,043 |
|
|
$ |
3,532,471 |
|
|
Community banking yield |
|
|
5.89 |
% |
|
|
5.79 |
% |
|
|
5.88 |
% |
|
|
5.91 |
% |
|
|
5.82 |
% |
|
Commercial finance yield |
|
|
11.64 |
% |
|
|
12.31 |
% |
|
|
12.52 |
% |
|
|
12.50 |
% |
|
|
12.82 |
% |
|
National lending yield |
|
|
4.96 |
% |
|
|
4.63 |
% |
|
|
5.62 |
% |
|
|
5.73 |
% |
|
|
5.44 |
% |
|
Total loan yield |
|
|
7.48 |
% |
|
|
7.63 |
% |
|
|
7.95 |
% |
|
|
7.99 |
% |
|
|
8.14 |
% |
8
Information pertaining to our factoring segment, which includes only factoring originated by our Triumph Business Capital subsidiary, summarized as of and for the quarters ended:
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|||||
|
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|||||
|
Factored receivable period end balance |
|
$ |
573,372,000 |
|
|
$ |
562,009,000 |
|
|
$ |
544,601,000 |
|
|
$ |
534,420,000 |
|
|
$ |
588,750,000 |
|
|
Yield on average receivable balance |
|
|
17.20 |
% |
|
|
18.23 |
% |
|
|
18.73 |
% |
|
|
17.96 |
% |
|
|
18.24 |
% |
|
Rolling twelve quarter annual charge-off rate |
|
|
0.39 |
% |
|
|
0.36 |
% |
|
|
0.40 |
% |
|
|
0.39 |
% |
|
|
0.37 |
% |
|
Factored receivables - transportation concentration |
|
|
81 |
% |
|
|
83 |
% |
|
|
83 |
% |
|
|
81 |
% |
|
|
83 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income, including fees |
|
$ |
24,813,000 |
|
|
$ |
24,869,000 |
|
|
$ |
24,762,000 |
|
|
$ |
23,803,000 |
|
|
$ |
27,578,000 |
|
|
Non-interest income |
|
|
1,154,000 |
|
|
|
1,291,000 |
|
|
|
1,205,000 |
|
|
|
1,077,000 |
|
|
|
1,032,000 |
|
|
Factored receivable total revenue |
|
|
25,967,000 |
|
|
|
26,160,000 |
|
|
|
25,967,000 |
|
|
|
24,880,000 |
|
|
|
28,610,000 |
|
|
Average net funds employed |
|
|
524,546,000 |
|
|
|
494,198,000 |
|
|
|
483,203,000 |
|
|
|
490,241,000 |
|
|
|
547,996,000 |
|
|
Yield on average net funds employed |
|
|
19.64 |
% |
|
|
21.00 |
% |
|
|
21.55 |
% |
|
|
20.58 |
% |
|
|
20.71 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable purchased |
|
$ |
1,489,538,000 |
|
|
$ |
1,450,905,000 |
|
|
$ |
1,408,982,000 |
|
|
$ |
1,325,140,000 |
|
|
$ |
1,541,332,000 |
|
|
Number of invoices purchased |
|
|
896,487 |
|
|
|
890,986 |
|
|
|
874,248 |
|
|
|
789,838 |
|
|
|
882,042 |
|
|
Average invoice size |
|
$ |
1,662 |
|
|
$ |
1,628 |
|
|
$ |
1,612 |
|
|
$ |
1,678 |
|
|
$ |
1,747 |
|
|
Average invoice size - transportation |
|
$ |
1,507 |
|
|
$ |
1,497 |
|
|
$ |
1,492 |
|
|
$ |
1,541 |
|
|
$ |
1,625 |
|
|
Average invoice size - non-transportation |
|
$ |
3,891 |
|
|
$ |
3,467 |
|
|
$ |
3,047 |
|
|
$ |
3,276 |
|
|
$ |
3,209 |
|
Deposits summarized as of:
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|
|||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
|||||
|
Non-interest bearing demand |
|
$ |
809,696 |
|
|
$ |
754,233 |
|
|
$ |
684,223 |
|
|
$ |
667,597 |
|
|
$ |
724,527 |
|
|
|
Interest bearing demand |
|
|
580,323 |
|
|
|
587,123 |
|
|
|
587,164 |
|
|
|
602,088 |
|
|
|
615,704 |
|
|
|
Individual retirement accounts |
|
|
104,472 |
|
|
|
108,593 |
|
|
|
111,328 |
|
|
|
112,696 |
|
|
|
115,583 |
|
|
|
Money market |
|
|
497,105 |
|
|
|
424,162 |
|
|
|
440,289 |
|
|
|
372,109 |
|
|
|
443,663 |
|
|
|
Savings |
|
|
363,270 |
|
|
|
356,368 |
|
|
|
362,594 |
|
|
|
372,914 |
|
|
|
369,389 |
|
|
|
Certificates of deposit |
|
|
1,084,425 |
|
|
|
1,120,850 |
|
|
|
1,122,873 |
|
|
|
851,411 |
|
|
|
835,127 |
|
|
|
Brokered deposits |
|
|
350,615 |
|
|
|
346,504 |
|
|
|
350,507 |
|
|
|
335,625 |
|
|
|
346,356 |
|
|
|
Total deposits |
|
$ |
3,789,906 |
|
|
$ |
3,697,833 |
|
|
$ |
3,658,978 |
|
|
$ |
3,314,440 |
|
|
$ |
3,450,349 |
|
|
9
Net interest margin summarized for the three months ended:
|
|
|
December 31, 2019 |
|
|
September 30, 2019 |
|
||||||||||||||||||
|
|
|
Average |
|
|
|
|
|
|
Average |
|
|
Average |
|
|
|
|
|
|
Average |
|
||||
|
(Dollars in thousands) |
|
Balance |
|
|
Interest |
|
|
Rate |
|
|
Balance |
|
|
Interest |
|
|
Rate |
|
||||||
|
Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest earning cash balances |
|
$ |
153,160 |
|
|
$ |
659 |
|
|
|
1.71 |
% |
|
$ |
104,569 |
|
|
$ |
603 |
|
|
|
2.29 |
% |
|
Taxable securities |
|
|
254,255 |
|
|
|
2,157 |
|
|
|
3.37 |
% |
|
|
278,878 |
|
|
|
2,495 |
|
|
|
3.55 |
% |
|
Tax-exempt securities |
|
|
37,680 |
|
|
|
222 |
|
|
|
2.34 |
% |
|
|
48,685 |
|
|
|
289 |
|
|
|
2.36 |
% |
|
FHLB and other restricted stock |
|
|
25,599 |
|
|
|
165 |
|
|
|
2.56 |
% |
|
|
19,698 |
|
|
|
209 |
|
|
|
4.21 |
% |
|
Loans |
|
|
4,134,393 |
|
|
|
77,968 |
|
|
|
7.48 |
% |
|
|
3,943,723 |
|
|
|
75,819 |
|
|
|
7.63 |
% |
|
Total interest earning assets |
|
$ |
4,605,087 |
|
|
$ |
81,171 |
|
|
|
6.99 |
% |
|
$ |
4,395,553 |
|
|
$ |
79,415 |
|
|
|
7.17 |
% |
|
Non-interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other assets |
|
|
445,773 |
|
|
|
|
|
|
|
|
|
|
|
444,987 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
5,050,860 |
|
|
|
|
|
|
|
|
|
|
$ |
4,840,540 |
|
|
|
|
|
|
|
|
|
|
Interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest bearing demand |
|
$ |
588,590 |
|
|
$ |
373 |
|
|
|
0.25 |
% |
|
$ |
585,706 |
|
|
$ |
355 |
|
|
|
0.24 |
% |
|
Individual retirement accounts |
|
|
106,645 |
|
|
|
435 |
|
|
|
1.62 |
% |
|
|
110,049 |
|
|
|
454 |
|
|
|
1.64 |
% |
|
Money market |
|
|
490,438 |
|
|
|
1,542 |
|
|
|
1.25 |
% |
|
|
416,526 |
|
|
|
1,406 |
|
|
|
1.34 |
% |
|
Savings |
|
|
359,024 |
|
|
|
119 |
|
|
|
0.13 |
% |
|
|
359,169 |
|
|
|
117 |
|
|
|
0.13 |
% |
|
Certificates of deposit |
|
|
1,108,647 |
|
|
|
6,491 |
|
|
|
2.32 |
% |
|
|
1,113,006 |
|
|
|
6,588 |
|
|
|
2.35 |
% |
|
Brokered deposits |
|
|
350,737 |
|
|
|
2,001 |
|
|
|
2.26 |
% |
|
|
352,430 |
|
|
|
2,116 |
|
|
|
2.38 |
% |
|
Total interest bearing deposits |
|
|
3,004,081 |
|
|
|
10,961 |
|
|
|
1.45 |
% |
|
|
2,936,886 |
|
|
|
11,036 |
|
|
|
1.49 |
% |
|
Subordinated notes |
|
|
63,706 |
|
|
|
1,035 |
|
|
|
6.45 |
% |
|
|
48,994 |
|
|
|
840 |
|
|
|
6.80 |
% |
|
Junior subordinated debentures |
|
|
39,491 |
|
|
|
687 |
|
|
|
6.90 |
% |
|
|
39,364 |
|
|
|
719 |
|
|
|
7.25 |
% |
|
Other borrowings |
|
|
438,447 |
|
|
|
2,080 |
|
|
|
1.88 |
% |
|
|
364,950 |
|
|
|
2,055 |
|
|
|
2.23 |
% |
|
Total interest bearing liabilities |
|
$ |
3,545,725 |
|
|
$ |
14,763 |
|
|
|
1.65 |
% |
|
$ |
3,390,194 |
|
|
$ |
14,650 |
|
|
|
1.71 |
% |
|
Non-interest bearing liabilities and equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing demand deposits |
|
|
791,379 |
|
|
|
|
|
|
|
|
|
|
|
735,527 |
|
|
|
|
|
|
|
|
|
|
Other liabilities |
|
|
66,210 |
|
|
|
|
|
|
|
|
|
|
|
68,778 |
|
|
|
|
|
|
|
|
|
|
Total equity |
|
|
647,546 |
|
|
|
|
|
|
|
|
|
|
|
646,041 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity |
|
$ |
5,050,860 |
|
|
|
|
|
|
|
|
|
|
$ |
4,840,540 |
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
|
|
|
$ |
66,408 |
|
|
|
|
|
|
|
|
|
|
$ |
64,765 |
|
|
|
|
|
|
Interest spread |
|
|
|
|
|
|
|
|
|
|
5.34 |
% |
|
|
|
|
|
|
|
|
|
|
5.46 |
% |
|
Net interest margin |
|
|
|
|
|
|
|
|
|
|
5.72 |
% |
|
|
|
|
|
|
|
|
|
|
5.85 |
% |
Loan balance totals include respective nonaccrual assets.
Net interest spread is the yield on average interest earning assets less the rate on interest bearing liabilities.
Net interest margin is the ratio of net interest income to average interest earning assets.
Average rates have been annualized.
10
Metrics and non-GAAP financial reconciliation:
|
|
|
As of and for the Three Months Ended |
|
|
As of and for the Years Ended |
|
||||||||||||||||||||||
|
(Dollars in thousands, |
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|
December 31, |
|
|
December 31, |
|
|||||||
|
except per share amounts) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|||||||
|
Net income available to common stockholders |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
51,130 |
|
|
Gain on sale of subsidiary or division |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,071 |
) |
|
Transaction related costs |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
6,965 |
|
|
Tax effect of adjustments |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,401 |
) |
|
Adjusted net income available to common stockholders |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
55,623 |
|
|
Dilutive effect of convertible preferred stock |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
578 |
|
|
Adjusted net income available to common stockholders - diluted |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
56,201 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding - diluted |
|
|
25,254,862 |
|
|
|
25,734,471 |
|
|
|
26,486,423 |
|
|
|
26,793,685 |
|
|
|
26,979,949 |
|
|
|
26,060,005 |
|
|
|
25,480,513 |
|
|
Adjusted effects of assumed Preferred Stock conversion |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Adjusted weighted average shares outstanding - diluted |
|
|
25,254,862 |
|
|
|
25,734,471 |
|
|
|
26,486,423 |
|
|
|
26,793,685 |
|
|
|
26,979,949 |
|
|
|
26,060,005 |
|
|
|
25,480,513 |
|
|
Adjusted diluted earnings per common share |
|
$ |
0.66 |
|
|
$ |
0.56 |
|
|
$ |
0.48 |
|
|
$ |
0.55 |
|
|
$ |
0.67 |
|
|
$ |
2.25 |
|
|
$ |
2.21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average total stockholders' equity |
|
$ |
647,546 |
|
|
$ |
646,041 |
|
|
$ |
652,347 |
|
|
$ |
644,960 |
|
|
$ |
632,126 |
|
|
$ |
647,726 |
|
|
$ |
559,450 |
|
|
Average preferred stock liquidation preference |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,624 |
|
|
|
— |
|
|
|
7,885 |
|
|
Average total common stockholders' equity |
|
|
647,546 |
|
|
|
646,041 |
|
|
|
652,347 |
|
|
|
644,960 |
|
|
|
629,502 |
|
|
|
647,726 |
|
|
|
551,565 |
|
|
Average goodwill and other intangibles |
|
|
191,551 |
|
|
|
193,765 |
|
|
|
196,002 |
|
|
|
198,389 |
|
|
|
200,754 |
|
|
|
194,905 |
|
|
|
121,820 |
|
|
Average tangible common stockholders' equity |
|
$ |
455,995 |
|
|
$ |
452,276 |
|
|
$ |
456,346 |
|
|
$ |
446,571 |
|
|
$ |
428,748 |
|
|
$ |
452,821 |
|
|
$ |
429,745 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income available to common stockholders |
|
$ |
16,709 |
|
|
$ |
14,317 |
|
|
$ |
12,730 |
|
|
$ |
14,788 |
|
|
$ |
18,085 |
|
|
$ |
58,544 |
|
|
$ |
51,130 |
|
|
Average tangible common equity |
|
|
455,995 |
|
|
|
452,276 |
|
|
|
456,346 |
|
|
|
446,571 |
|
|
|
428,748 |
|
|
|
452,821 |
|
|
|
429,745 |
|
|
Return on average tangible common equity |
|
|
14.54 |
% |
|
|
12.56 |
% |
|
|
11.19 |
% |
|
|
13.43 |
% |
|
|
16.73 |
% |
|
|
12.93 |
% |
|
|
11.90 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted efficiency ratio: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
66,408 |
|
|
$ |
64,765 |
|
|
$ |
63,419 |
|
|
$ |
61,311 |
|
|
$ |
64,881 |
|
|
$ |
255,903 |
|
|
$ |
227,050 |
|
|
Non-interest income |
|
|
8,666 |
|
|
|
7,742 |
|
|
|
7,623 |
|
|
|
7,538 |
|
|
|
6,794 |
|
|
|
31,569 |
|
|
|
22,970 |
|
|
Operating revenue |
|
|
75,074 |
|
|
|
72,507 |
|
|
|
71,042 |
|
|
|
68,849 |
|
|
|
71,675 |
|
|
|
287,472 |
|
|
|
250,020 |
|
|
Gain on sale of subsidiary or division |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,071 |
) |
|
Adjusted operating revenue |
|
$ |
75,074 |
|
|
$ |
72,507 |
|
|
$ |
71,042 |
|
|
$ |
68,849 |
|
|
$ |
71,675 |
|
|
$ |
287,472 |
|
|
$ |
248,949 |
|
|
Non-interest expenses |
|
$ |
52,661 |
|
|
$ |
52,153 |
|
|
$ |
50,704 |
|
|
$ |
48,566 |
|
|
$ |
46,962 |
|
|
$ |
204,084 |
|
|
$ |
167,353 |
|
|
Transaction related costs |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(6,965 |
) |
|
Adjusted non-interest expenses |
|
$ |
52,661 |
|
|
$ |
52,153 |
|
|
$ |
50,704 |
|
|
$ |
48,566 |
|
|
$ |
46,962 |
|
|
$ |
204,084 |
|
|
$ |
160,388 |
|
|
Adjusted efficiency ratio |
|
|
70.15 |
% |
|
|
71.93 |
% |
|
|
71.37 |
% |
|
|
70.54 |
% |
|
|
65.52 |
% |
|
|
70.99 |
% |
|
|
64.43 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net non-interest expense to average assets ratio: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest expenses |
|
$ |
52,661 |
|
|
$ |
52,153 |
|
|
$ |
50,704 |
|
|
$ |
48,566 |
|
|
$ |
46,962 |
|
|
$ |
204,084 |
|
|
$ |
167,353 |
|
|
Transaction related costs |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(6,965 |
) |
|
Adjusted non-interest expenses |
|
$ |
52,661 |
|
|
$ |
52,153 |
|
|
$ |
50,704 |
|
|
$ |
48,566 |
|
|
$ |
46,962 |
|
|
$ |
204,084 |
|
|
$ |
160,388 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest income |
|
$ |
8,666 |
|
|
$ |
7,742 |
|
|
$ |
7,623 |
|
|
$ |
7,538 |
|
|
$ |
6,794 |
|
|
$ |
31,569 |
|
|
$ |
22,970 |
|
|
Gain on sale of subsidiary or division |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,071 |
) |
|
Adjusted non-interest income |
|
$ |
8,666 |
|
|
$ |
7,742 |
|
|
$ |
7,623 |
|
|
$ |
7,538 |
|
|
$ |
6,794 |
|
|
$ |
31,569 |
|
|
$ |
21,899 |
|
|
Adjusted net non-interest expenses |
|
$ |
43,995 |
|
|
$ |
44,411 |
|
|
$ |
43,081 |
|
|
$ |
41,028 |
|
|
$ |
40,168 |
|
|
$ |
172,515 |
|
|
$ |
138,489 |
|
|
Average total assets |
|
$ |
5,050,860 |
|
|
$ |
4,840,540 |
|
|
$ |
4,694,647 |
|
|
$ |
4,501,760 |
|
|
$ |
4,488,918 |
|
|
$ |
4,773,652 |
|
|
$ |
3,900,728 |
|
|
Adjusted net non-interest expense to average assets ratio |
|
|
3.46 |
% |
|
|
3.64 |
% |
|
|
3.68 |
% |
|
|
3.70 |
% |
|
|
3.55 |
% |
|
|
3.61 |
% |
|
|
3.55 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' equity |
|
$ |
636,590 |
|
|
$ |
633,693 |
|
|
$ |
643,362 |
|
|
$ |
646,216 |
|
|
$ |
636,607 |
|
|
$ |
636,590 |
|
|
$ |
636,607 |
|
|
Goodwill and other intangibles |
|
|
(190,286 |
) |
|
|
(192,440 |
) |
|
|
(194,668 |
) |
|
|
(197,015 |
) |
|
|
(199,417 |
) |
|
|
(190,286 |
) |
|
|
(199,417 |
) |
|
Tangible common stockholders' equity |
|
$ |
446,304 |
|
|
$ |
441,253 |
|
|
$ |
448,694 |
|
|
$ |
449,201 |
|
|
$ |
437,190 |
|
|
$ |
446,304 |
|
|
$ |
437,190 |
|
|
Common shares outstanding |
|
|
24,964,961 |
|
|
|
25,357,985 |
|
|
|
26,198,308 |
|
|
|
26,709,411 |
|
|
|
26,949,936 |
|
|
|
24,964,961 |
|
|
|
26,949,936 |
|
|
Tangible book value per share |
|
$ |
17.88 |
|
|
$ |
17.40 |
|
|
$ |
17.13 |
|
|
$ |
16.82 |
|
|
$ |
16.22 |
|
|
$ |
17.88 |
|
|
$ |
16.22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets at end of period |
|
$ |
5,060,297 |
|
|
$ |
5,039,697 |
|
|
$ |
4,783,189 |
|
|
$ |
4,529,783 |
|
|
$ |
4,559,779 |
|
|
$ |
5,060,297 |
|
|
$ |
4,559,779 |
|
|
Goodwill and other intangibles |
|
|
(190,286 |
) |
|
|
(192,440 |
) |
|
|
(194,668 |
) |
|
|
(197,015 |
) |
|
|
(199,417 |
) |
|
|
(190,286 |
) |
|
|
(199,417 |
) |
|
Tangible assets at period end |
|
$ |
4,870,011 |
|
|
$ |
4,847,257 |
|
|
$ |
4,588,521 |
|
|
$ |
4,332,768 |
|
|
$ |
4,360,362 |
|
|
$ |
4,870,011 |
|
|
$ |
4,360,362 |
|
|
Tangible common stockholders' equity ratio |
|
|
9.16 |
% |
|
|
9.10 |
% |
|
|
9.78 |
% |
|
|
10.37 |
% |
|
|
10.03 |
% |
|
|
9.16 |
% |
|
|
10.03 |
% |
11
|
|
• |
“Adjusted diluted earnings per common share” is defined as adjusted net income available to common stockholders divided by adjusted weighted average diluted common shares outstanding. Excluded from net income available to common stockholders are material gains and expenses related to merger and acquisition-related activities, including divestitures, net of tax. In our judgment, the adjustments made to net income available to common stockholders allow management and investors to better assess our performance in relation to our core net income by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business. Weighted average diluted common shares outstanding are adjusted as a result of changes in their dilutive properties given the gain and expense adjustments described herein. |
|
|
|
• |
"Tangible common stockholders' equity" is defined as common stockholders' equity less goodwill and other intangible assets. |
|
|
|
• |
"Total tangible assets" is defined as total assets less goodwill and other intangible assets. |
|
|
|
• |
"Tangible book value per share" is defined as tangible common stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets. |
|
|
|
• |
"Tangible common stockholders' equity ratio" is defined as the ratio of tangible common stockholders' equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets. |
|
|
|
• |
"Return on Average Tangible Common Equity" is defined as net income available to common stockholders divided by average tangible common stockholders' equity. |
|
|
|
• |
"Adjusted efficiency ratio" is defined as non-interest expenses divided by our operating revenue, which is equal to net interest income plus non-interest income. Also excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. In our judgment, the adjustments made to operating revenue and non-interest expense allow management and investors to better assess our performance in relation to our core operating revenue by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business. |
|
|
|
• |
"Adjusted net non-interest expense to average total assets" is defined as non-interest expenses net of non-interest income divided by total average assets. Excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. This metric is used by our management to better assess our operating efficiency. |
|
|
2) |
Performance ratios include discount accretion on purchased loans for the periods presented as follows: |
|
|
|
|
For the Three Months Ended |
|
|
For the Years Ended |
|
||||||||||||||||||||||
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|
December 31, |
|
|
December 31, |
|
|||||||
|
(Dollars in thousands) |
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|||||||
|
Loan discount accretion |
|
$ |
1,555 |
|
|
$ |
1,159 |
|
|
$ |
1,297 |
|
|
$ |
1,557 |
|
|
$ |
1,411 |
|
|
$ |
5,568 |
|
|
$ |
8,296 |
|
|
3) |
Asset quality ratios exclude loans held for sale, except for non-performing assets to total assets. |
|
|
4) |
Current quarter ratios are preliminary. |
|
Source: Triumph Bancorp, Inc.
###
Investor Relations:
Luke Wyse
Senior Vice President, Finance & Investor Relations
lwyse@tbkbank.com
214-365-6936
Media Contact:
Amanda Tavackoli
Senior Vice President, Marketing & Communication
atavackoli@tbkbank.com
214-365-6930
12
Q4 2019 earnings release January 21, 2020 Exhibit 99.2
Forward-Looking Statements This presentation contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; risks related to the integration of acquired businesses (including our acquisitions of First Bancorp of Durango, Inc., Southern Colorado Corp., and the operating assets of Interstate Capital Corporation and certain of its affiliates) and any future acquisitions; changes in management personnel; interest rate risk; concentration of our factoring services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets, or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally, or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities, and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of the Federal Deposit Insurance Corporation insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements. While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake 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. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see “Risk Factors” and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 12, 2019. Non-GAAP Financial Measures This presentation includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided at the end of the presentation. Numbers in this presentation may not sum due to rounding. Unless otherwise referenced, all data presented is as of December 31, 2019. PAGE DISCLAIMER
COMPANY OVERVIEW PAGE Triumph Bancorp, Inc. (NASDAQ: TBK) (“Triumph”) is a financial holding company headquartered in Dallas, Texas. Triumph offers a diversified line of community banking, national lending, and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com TOTAL ASSETS $5.1 billion MARKET CAP $949.2 million TOTAL LOANS $4.2 billion TOTAL DEPOSITS $3.8 billion Data is as of and for the quarter ended December 31, 2019
PLATFORM OVERVIEW – BRANCH NETWORK PAPAGE GE 61 TOTAL BRANCHES 37 in Colorado 15 in Illinois 3 in Iowa 3 in New Mexico 2 in Kansas 1 in Texas BRANCH LOCATIONS as of December 31, 2019
PLATFORM OVERVIEW – LENDING PAG PAGE E 27% Texas GEOGRAPHIC LENDING CONCENTRATIONS1 as of December 31, 2019 23% Colorado 1% Kansas 7% Iowa 13% Illinois 4% New Mexico 1 States with a physical branch presence. Excludes factored receivables
Q4 2019 RESULTS AND RECENT DEVELOPMENTS PAGE Diluted earnings per share of $0.66 for the quarter Total loans held for investment decreased $14.9 million The community banking portfolio decreased $113.0 million, the commercial finance portfolio decreased $25.6 million, and the national lending portfolio increased $123.7 million Deposit growth of $92.1 million, or 2.5% Noninterest bearing demand deposit growth of $55.5 million, or 7.4% Repurchased 392,557 shares of common stock into treasury stock under the stock repurchase program at an average price of $36.69, for a total of $14.4 million $16.7 million Net income to common stockholders LOAN CHANGE (0.4%) Loans Held for Investment NIM 5.72% Net Interest Margin1 ROATCE 14.54% Return on Average Tangible Common Equity2 TCE/TA 9.16% Tangible Common Equity / Tangible Assets2 1 Includes discount accretion on purchased loans of $1,555 in Q4 2019 2 Reconciliations of non-GAAP financial measures can be found at the end of the presentation
PAPAGE GE NET INTEREST INCOME TO AVERAGE ASSETS Q4 5.22% Goal 6.00 - 6.50% NET OVERHEAD RATIO Q4 3.46% Goal 3.00 - 3.50% Annualized performance metrics presented are for the three months ended December 31, 2019 Reconciliations of these financial measures can be found at the end of the presentation LONG TERM PERFORMANCE GOALS VS ACTUAL Q4 PRE-PROVISION NET REVENUE Q4 1.76% Goal > 3.00% CREDIT COSTS Q4 0.03% Goal < 0.30% TAXES Q4 0.42% Goal ~ 0.57% RETURN ON AVERAGE ASSETS Q4 1.31% Goal > 2.00% AVERAGE TANGIBLE COMMON EQUITY TO AVERAGE ASSETS Q4 9.03% Goal ~ 8.75% RETURN ON AVERAGE TANGIBLE COMMON EQUITY (“ROATCE”) Goal > 20.00% Q4 14.54%
LOAN PORTFOLIO PAGEPAGE TOTAL LOANS COMMUNITY BANKING Focused on core deposit generation and business lending in the communities we serve COMMERCIAL FINANCE Factoring, asset based lending, and equipment finance produce top tier return on assets NATIONAL LENDING Mortgage warehouse to provide portfolio diversification, premium finance to complement our commercial finance products, and liquid credit to opportunistically scale our loan portfolio $4,197.3 Total loans include $2.7 million of 1-4 residential mortgage loans held for sale Chart data labels – dollars in millions $2,096.4 50% $1,250.5 30% $850.4 20% $4,197.3
LOAN PORTFOLIO DETAIL PAGEPAGE COMMUNITY BANKING 50% of Total Portfolio NATIONAL LENDING 20% of Total Portfolio COMMERCIAL FINANCE 30% of Total Portfolio $2,096.4 $850.4 $1,250.5 Chart data labels – dollars in millions (1) Includes $2.7 million of mortgage loans held for sale $1,544.7 74% $529.8 25% $21.9 1% $2,096.4 $620.0 50% $461.5 37% $169.0 13% $1,250.5 $668.0 78% $81.4 10% $101.0 12% $850.4
TRIUMPH BUSINESS CAPITAL FACTORING PAGE PAGE Yield of 17.20% in the current quarter Average annual charge-off rate of 0.39% over the past 3 years * On June 2, 2018, we acquired $131.0 million of transportation factoring assets via the acquisition of Interstate Capital Corporation and certain of its affiliates [Pie Chart] Transportation Non-Transportation 81% 19% [Bar/Line Chart] Total Purchases Number of Invoices Purchased [Bar Chart] Average Invoice Size
TRANSPORTATION FINANCE PAGE Gross transportation revenue consists of factoring revenue from transportation clients, interest and fees from commercial loans to borrowers in transportation industries, transportation related insurance commissions, and revenue from TriumphPay. Total gross revenue consists of total interest income and noninterest income. Transportation assets include transportation related factored receivables and commercial loans to borrowers in transportation industries. By proudly banking the trucking industry, we intend to be a dominant player in a large industry that is a profitable sector for a well-positioned bank. Products we offer to transportation clients include: Checking Treasury management Factoring Equipment finance TriumphPay Commercial lending Fuel cards Premium finance Insurance brokerage [Bar Chart] Gross Transportation Revenue as a percent of Total Gross Revenue Transportation Assets as a percent of Total Assets
CARRIER PAYMENT PLATFORM CLIENTS ON PLATFORM PAGE [Bar/Line Chart] Invoice and Payment Trends Number of Invoices Payment Amounts Processed Total payment amounts processed (annualized) Total invoices processed (annualized)
LOAN PORTFOLIO PAGE [Bar Chart] NCOs / Average Loans Net Chargeoffs [Bar Chart] NPAs / Total Assets Non-performing assets [Bar/Line Chart] Acquired Loans Purchase Discount Remaining Discount Accretion Recognized [Bar Chart] ALLL / Total Loans ALLL
DEPOSIT MIX PAGPAGE E [Bar Chart] Deposit Balances [Pie Chart] Deposit Mix Non-interest bearing demand Interest bearing demand Individual retirement accounts Money market Savings Certificates of deposit Brokered deposits 21% 15% 3% 13% 10% 29% 9%
FINANCIAL HIGHLIGHTS PAGE 1) Reconciliations of non-GAAP financial measures can be found at the end of the presentation. Adjusted metrics exclude material gains and expenses related to merger and acquisition-related activities, net of tax where applicable. 2) Includes discount accretion on purchased loans of $1,411 in 4Q18, $1,557 in 1Q19, $1,297 in 2Q19, $1,159 in 3Q19, and $1,555 in 4Q19 (dollars in thousands). 3) Asset quality ratios exclude loans held for sale. 4) Current quarter ratios are preliminary As of and For the Three Months Ended Key Metrics December 31, September 30, June 30, March 31, December 31, 2019 2019 2019 2019 2018 Performance ratios - annualized Return on average assets 1.31% 1.17% 1.09% 1.33% 1.60% Return on average tangible common equity (ROATCE) (1) 14.54% 12.56% 11.19% 13.43% 16.73% Yield on loans(2) 7.48% 7.63% 7.95% 7.99% 8.14% Cost of total deposits 1.15% 1.19% 1.14% 0.99% 0.91% Net interest margin(2) 5.72% 5.85% 5.99% 6.15% 6.34% Net non-interest expense to average assets 3.46% 3.64% 3.68% 3.70% 3.55% Efficiency ratio 70.15% 71.93% 71.37% 70.54% 65.52% Asset Quality(3) Non-performing assets to total assets 0.87% 0.91% 0.86% 0.84% 0.84% ALLL to total loans 0.69% 0.76% 0.77% 0.76% 0.76% Net charge-offs to average loans 0.08% 0.01% 0.05% 0.03% 0.05% Capital(4) Tier 1 capital to average assets 10.03% 10.37% 10.84% 11.32% 11.08% Tier 1 capital to risk-weighted assets 10.29% 10.08% 11.08% 11.76% 11.49% Common equity tier 1 capital to risk-weighted assets 9.45% 9.26% 10.19% 10.81% 10.55% Total capital to risk-weighted assets 12.75% 11.79% 12.88% 13.62% 13.35% Per Share Amounts Book value per share $25.50 $24.99 $24.56 $24.19 $23.62 Tangible book value per share (1) $17.88 $17.40 $17.13 $16.82 $16.22 Basic earnings per common share $0.67 $0.56 $0.48 $0.55 $0.68 Diluted earnings per common share $0.66 $0.56 $0.48 $0.55 $0.67
NON-GAAP FINANCIAL RECONCILIATION PAGE Metrics and non-GAAP financial reconciliation As of and for the Three Months Ended December 31, September 30, June 30, March 31, December 31, (Dollars in thousands, except per share amounts) 2019 2019 2019 2019 2018 Average total stockholders' equity $647,546 $646,041 $652,347 $644,960 $632,126 Average preferred stock liquidation preference — — — — 2,624 Average total common stockholders' equity 647,546 646,041 652,347 644,960 629,502 Average goodwill and other intangibles 191,551 193,765 196,002 198,389 200,754 Average tangible common stockholders' equity $455,995 $452,276 $456,346 $446,571 $428,748 Net income available to common stockholders $16,709 $14,317 $12,730 $14,788 $18,085 Average tangible common equity 455,995 452,276 456,346 446,571 428,748 Return on average tangible common equity 14.54% 12.56% 11.19% 13.43% 16.73% Net interest income $66,408 $64,765 $63,419 $61,311 $64,881 Non-interest income 8,666 7,742 7,623 7,538 6,794 Operating revenue $75,074 $72,507 $71,042 $68,849 $71,675 Non-interest expenses $52,661 $52,153 $50,704 $48,566 $46,962 Efficiency ratio 70.15% 71.93% 71.37% 70.54% 65.52% Non-interest expenses $52,661 $52,153 $50,704 $48,566 $46,962 Non-interest income 8,666 7,742 7,623 7,538 6,794 Net non-interest expenses $43,995 $44,411 $43,081 $41,028 $40,168 Average total assets $5,050,860 $4,840,540 $4,694,647 $4,501,760 $4,488,918 Net non-interest expense to average assets ratio 3.46% 3.64% 3.68% 3.70% 3.55%
NON-GAAP FINANCIAL RECONCILIATION PAGE Metrics and non-GAAP financial reconciliation (cont'd) As of and for the Three Months Ended December 31, September 30, June 30, March 31, December 31, (Dollars in thousands, except per share amounts) 2019 2019 2019 2019 2018 Total stockholders' equity $636,590 $633,693 $643,362 $646,216 $636,607 Goodwill and other intangibles (190,286) (192,440) (194,668) (197,015) (199,417) Tangible common stockholders' equity $446,304 $441,253 $448,694 $449,201 $437,190 Common shares outstanding at end of period 24,964,961 25,357,985 26,198,308 26,709,411 26,949,936 Tangible book value per share $17.88 $17.40 $17.13 $16.82 $16.22 Total assets at end of period $5,060,297 $5,039,697 $4,783,189 $4,529,783 $4,559,779 Goodwill and other intangibles (190,286) (192,440) (194,668) (197,015) (199,417) Tangible assets at period end $4,870,011 $4,847,257 $4,588,521 $4,332,768 $4,360,362 Tangible common stockholders' equity ratio 9.16% 9.10% 9.78% 10.37% 10.03%
NON-GAAP FINANCIAL RECONCILIATION PPAGE AGE Ratios may not recalculate due to rounding Metrics and non-GAAP financial reconciliation (cont'd) For the Three Months Ended For the Three Months Ended December 31, 2019 December 31, 2019 (Dollars in thousands, except per share amounts) GAAP (Dollars in thousands, except per share amounts) GAAP Net interest income to average total assets: Return on average total assets: Net interest income $66,408 Net interest income to average assets 5.22% Average total assets 5,050,860 Net noninterest expense to average assets ratio (3.46%) Net interest income to average assets 5.22% Pre-provision net revenue to average assets 1.76% Credit costs to average assets (0.03%) Net noninterest expense to average total assets: Taxes to average assets (0.42%) Total noninterest expense $52,661 Return on average assets 1.31% Total noninterest income 8,666 Net noninterest expense $43,995 Average tangible common equity to average assets: Average total assets 5,050,860 Average tangible equity $455,995 Net noninterest expense to average assets ratio 3.46% Average assets 5,050,860 Average tangible equity to average assets 9.03% Pre-provision net revenue to average total assets: Net interest income $66,408 Return on average tangible common equity: Net noninterest expense 43,995 Return on average assets 1.31% Pre-provision net revenue $22,413 Average tangible equity to average assets 9.03% Average total assets 5,050,860 Return on average tangible common equity: 14.54% Pre-provision net revenue to average assets 1.76% Credit costs to average total assets: Provision for loan losses $382 Average total assets 5,050,860 Credit costs to average assets 0.03% Taxes to average total assets: Income tax expense $5,322 Average total assets 5,050,860 Taxes to average assets 0.42%
Appendix
FACTORING 101 PAGE WHAT IS FACTORING? Factoring is one of the oldest forms of finance. Factoring is a financial transaction in which a business sells its accounts receivable to a third party (factor) at a discount. A business typically factors its receivable assets to meet its present and immediate cash needs. The transaction is a purchase of an invoice, not a loan. WHAT IS THE MARKET? Factoring industry data is limited. Based on IFA* studies and discussions with industry experts, we estimate the market, excluding traditional factoring (textiles, furniture, etc.), at ~$120B in annual purchases. Given these estimates, we assume transportation factoring is 45-50% of that market or approximately $60B. We represent ~5% of the total market and ~10% of the transportation market. We are among the 3 largest discount transportation factors and in the top 10 overall of discount factors. WHO ARE OUR CLIENTS? Our typical client has limited financial systems. We can factor clients with historical losses, little (if any) net worth, early stage (less than 3 years activity) businesses, turnarounds and restructurings. WHO IS TRIUMPH BUSINESS CAPITAL? We are a highly specialized factor in the transportation space factoring 3 groups of clients: Recourse trucking Non-recourse trucking (owner / operators) Freight brokers Other industry verticals Similar collateral and portfolio servicing characteristics (staffing, warehousing, etc.) TRIUMPH BUSINESS CAPITAL ECONOMICS:* Our client performs services for the account debtor. The client generates an invoice for $1,000 payable in 30 days. The client sells the invoice to Triumph (factor), who pays the client $900 ($1,000 less a 10% cash reserve or “holdback”). Triumph employs $900 of funds to acquire the invoice. We charge a 2.5% discount fee ($25), which reflects a ~2.8% yield on the actual funds employed. Assuming a similarly sized invoice, with the client, was collected (“turned”) every 36 days (or ~10 times per year) Triumph’s annualized yield on the $900 of Net Funds Employed is ~28% ($25 fee * 10 purchases annually / $900). When the invoice is collected, the 10% holdback less our fee is paid to the client. Source: http://www.factoring.org *Illustrative Example of a factoring Transaction FACTOR CLIENT ACCOUNT DEBTOR
TRIUMPHPAY 101 PAGE TRIUMPHPAY ECONOMICS:* Client approves invoice for $2,000. Payment terms are 35 days. Carrier opts for QuickPay. Triumph pays the carrier $1,960 same day or next day. The $40 difference represents the QuickPay fee. In this example arrangement, that fee is then split between the broker and Triumph, $20 each. At day 35, Triumph drafts $2,000 from the broker. The $20 fee retained by Triumph equates to an annualized yield of 9.6% NO QUICKPAY If the carrier declines to use QuickPay, at day 34 Triumph drafts $2,000 from Broker. Triumph then pays the Carrier on day 35 by wire, ACH or check. Two day average float to Triumph. WHAT IS TRIUMPHPAY? TriumphPay is a reverse factoring product that connects our proprietary payment processing system with a broker or third party logistics’ (3PL) transportation management and accounting system to facilitate payments to carriers, provide improved liquidity options to clients, and generate enhanced revenue opportunities for both TBK and the client through QuickPay programs. WHAT IS THE MARKET? Based on our analysis of the third party logistics/broker portion of the for-hire trucking market, we estimate the market to be ~$170 billion. WHO IS THE CUSTOMER? Large and mid-sized freight brokers and 3PL firms who are suffering from factor fatigue, desire enhanced liquidity options and expanded revenue opportunities. *Illustrative Example of a TriumphPay Transaction