Market Overview

Eagle Bancorp, Inc. Announces Another Quarter of Record Earnings With Second Quarter 2017 Net Income up 15% Over 2016

Share:

BETHESDA, Md., July 19, 2017 (GLOBE NEWSWIRE) -- Eagle Bancorp, Inc. (the "Company") (NASDAQ:EGBN), the parent company of EagleBank, today announced record quarterly net income of $27.8 million for the three months ended June 30, 2017, a 15% increase over the $24.1 million net income for the three months ended June 30, 2016. Net income per basic common share for the three months ended June 30, 2017 was $0.81 compared to $0.72 for the same period in 2016, a 13% increase. Net income per diluted common share for the three months ended June 30, 2017 was $0.81 compared to $0.71 for the same period in 2016, a 14% increase.

Eagle Bancorp, Inc. Logo



For the six months ended June 30, 2017, the Company's net income was $54.8 million, a 15% increase over the $47.5 million for the same period in 2016. Net income per basic common share for the six months ended June 30, 2017 was $1.61 compared to $1.41 for the same period in 2016, a 14% increase. Net income per diluted common share for the six months ended June 30, 2017 was $1.60 compared to $1.39 for the same period in 2016, a 15% increase.

"We are very pleased to report a continued quarterly trend of balanced and consistently strong financial performance," noted Ronald D. Paul, Chairman and Chief Executive Officer of Eagle Bancorp, Inc. "Our net income has increased for 34 consecutive quarters dating back to the first quarter of 2009. We are proud that this performance has been the result of a combination of balance sheet growth, revenue growth, solid asset quality, and improved operating leverage. We continued to benefit from growth in new loans even while anticipated loan maturities increased. Notwithstanding such payoffs, we are very pleased to report continued growth in earnings and earnings per share. Additionally, the new FHA Multifamily lending division is beginning to add revenue."

The Company's financial performance for the six months ended June 30, 2017 as compared to June 30, 2016 was highlighted by:

  • growth in total loans of 11% over the prior year;
  • growth in total deposits of 10% over the prior year;
  • growth in total revenue of 7% for the first six months of 2017 over 2016;
  • a year-to-date annualized net charge-off ratio to average loans of 0.03%;
  • noninterest income contribution from our FHA Multifamily lending division;
  • further improvement in operating leverage from an already favorable position; and
  • a reduction in the efficiency ratio to 39.57% for the first six months of 2017.

Mr. Paul added, "At a time when the net interest margin of banks is being challenged by rising rates, the Company remains committed to cost management measures and strong productivity." The strong second quarter earnings resulted in an annualized return on average assets ("ROAA") of 1.60% and an annualized return on average common equity ("ROACE") of 12.51%.

For the first six months of 2017, total loans grew 5% over December 31, 2016, and averaged 12% higher in the first six months of 2017 as compared to the first six months of 2016. Loan growth has moderated in the second quarter due to both our being more selective in new credit opportunities and due to higher levels of loan maturities as projects continue to perform well. At June 30, 2017, total deposits were 3% higher than deposits at December 31, 2016, while deposits averaged 9% higher for the first six months of 2017 compared with the first six months of 2016.

The net interest margin ("NIM") was 4.16% for the second quarter of 2017 which was two basis points higher than first quarter of 2017. Mr. Paul noted, "We believe that our NIM remains favorable to peer banks. Importantly, we have been able to sustain attractive loan yields which were 5.14% for the second quarter, up one basis point from first quarter and up four basis points from second quarter in 2016. By achieving better loan yields, which is in part due to having a high percentage of variable rate loans that benefit from short term rate increases by the Federal Reserve, we are doing well in offsetting a higher cost of funds. The Company's focus continues to be on all the factors that contribute to earnings per share growth, as opposed to dependence on any one factor."

Total revenue (net interest income plus noninterest income) for the second quarter of 2017 was $76.7 million, or 7% above the $71.4 million of total revenue earned for the second quarter of 2016 and was 5% higher than the $73.0 million of revenue earned in the first quarter of 2017. For the six month periods, total revenue was $149.7 million for 2017, as compared to $140.3 million in 2016, a 7% increase.  

The primary driver of the Company's revenue growth for the second quarter of 2017 as compared to the second quarter in 2016 was its net interest income growth of 9% ($69.7 million versus $63.8 million). Noninterest income (excluding investment gains) declined by 1% in the second quarter 2017 over 2016, due substantially to higher sales in 2016 of Small Business Administration ("SBA") and residential mortgage loans and the resulting gains on the sale of these loans. The lower revenue associated with SBA and residential mortgage loan sales was effectively offset by income of $642 thousand (net of certain transaction expenses) on the origination, securitization, servicing and sale of FHA Multifamily-Backed Government National Mortgage Association ("GNMA") securities.

Asset quality measures remained solid at June 30, 2017. Net charge-offs (annualized) were 0.02% of average loans for the second quarter of 2017, as compared to 0.15% of average loans for the second quarter of 2016. At June 30, 2017, the Company's nonperforming loans amounted to $17.1 million (0.29% of total loans) as compared to $21.4 million (0.40% of total loans) at June 30, 2016 and $17.9 million (0.31% of total loans) at December 31, 2016. Nonperforming assets amounted to $18.5 million (0.26% of total assets) at June 30, 2017 compared to $24.5 million (0.39% of total assets) at June 30, 2016 and $20.6 million (0.30% of total assets) at December 31, 2016.

Management continues to remain attentive to any signs of deterioration in borrowers' financial conditions and is proactive in taking the appropriate steps to mitigate risk. Furthermore, the Company is diligent in placing loans on nonaccrual status and believes, based on its loan portfolio risk analysis, that its allowance for credit losses, at 1.02% of total loans (excluding loans held for sale) at June 30, 2017, is adequate to absorb potential credit losses within the loan portfolio at that date. The allowance for credit losses was 1.05% at June 30, 2016 and 1.04% of total loans at December 31, 2016. The allowance at June 30, 2017 for credit losses represented 356% of nonperforming loans, as compared to 264% at June 30, 2016 and 330% at December 31, 2016.

"The Company's productivity continued to improve in the second quarter," noted Mr. Paul. The efficiency ratio of 39.10% reflects management's ongoing efforts to maintain superior operating leverage. The annualized level of noninterest expenses as a percentage of average assets has declined to 1.72% in the second quarter of 2017 as compared to 1.83% in the second quarter of 2016. A relatively stable staff, capacity utilization, branch rationalization, a low level of problem assets, and leveraging of other fixed costs have been the major reasons for improved operating leverage. Additionally, the Company continues investments in IT systems and resources, including its online client services. Our goal is to improve operating performance without inhibiting growth or negatively impacting our ability to service our customers. Mr. Paul further noted, "We will continue to maintain strict oversight of expenses, while retaining an infrastructure to remain competitive, support our growth initiatives and manage risk."

Total assets at June 30, 2017 were $7.24 billion, a 14% increase as compared to $6.37 billion at June 30, 2016, and a 5% increase as compared to $6.89 billion at December 31, 2016. Total loans (excluding loans held for sale) were $5.99 billion at June 30, 2017, an 11% increase as compared to $5.40 billion at June 30, 2016, and a 5% increase as compared to $5.68 billion at December 31, 2016. Loans held for sale amounted to $49.3 million at June 30, 2017 as compared to $59.3 million at June 30, 2016, a 17% decrease, and $51.6 million at December 31, 2016, a 5% decrease. The investment portfolio totaled $497.7 million at June 30, 2017, a 22% increase from the $409.5 million balance at June 30, 2016. As compared to December 31, 2016, the investment portfolio at June 30, 2017 decreased by $40.4 million or 8%.

Total deposits at June 30, 2017 were $5.87 billion, compared to deposits of $5.34 billion at June 30, 2016, a 10% increase, and deposits of $5.72 billion at December 31, 2016, a 3% increase. Total borrowed funds (excluding customer repurchase agreements) were $361.7 million at June 30, 2017, $119.0 million at June 30, 2016 and $216.5 million at December 31, 2016. We continue to work on expanding the breadth and depth of our existing relationships while we pursue building new relationships.

Total shareholders' equity at June 30, 2017 increased 15%, to $902.7 million, compared to $788.6 million at June 30, 2016, and increased 7%, from $842.8 million at December 31, 2016. The Company's capital position remains substantially in excess of regulatory requirements for well capitalized status, with a total risk based capital ratio of 15.13% at June 30, 2017, as compared to 12.73% at June 30, 2016, and 14.89% at December 31, 2016. In addition, the tangible common equity ratio was 11.15% at June 30, 2017, compared to 10.88% at June 30, 2016 and 10.84% at December 31, 2016.

Analysis of the three months ended June 30, 2017 compared to June 30, 2016

For the three months ended June 30, 2017, the Company reported an annualized ROAA of 1.60% as compared to 1.57% for the three months ended June 30, 2016. The annualized ROACE for the three months ended June 30, 2017 was 12.51%, as compared to 12.40% for the three months ended June 30, 2016. 

Net interest income increased 9% for the three months ended June 30, 2017 over the same period in 2016 ($69.7 million versus $63.8 million), resulting from growth in average earning assets of 13%. The net interest margin was 4.16% for the three months ended June 30, 2017, as compared to 4.30% for the three months ended June 30, 2016. The Company believes its net interest margin remains favorable compared to peer banking companies and that its disciplined approach to managing the loan portfolio yield to 5.14% for the second quarter in 2017 has been a significant factor in its overall profitability.

The provision for credit losses was $1.6 million for the three months ended June 30, 2017 as compared to $3.9 million for the three months ended June 30, 2016. The lower provisioning in the second quarter of 2017, as compared to the second quarter of 2016, is primarily due to lower loan growth, as net loans increased $160.1 million in the three months ended June 30, 2017, as compared to an increase of $247.6 million in the same period in 2016, and to overall improved asset quality. Net charge-offs of $366 thousand in the second quarter of 2017 represented an annualized 0.02% of average loans, excluding loans held for sale, as compared to $2.0 million, or an annualized 0.15% of average loans, excluding loans held for sale, in the second quarter of 2016. Net charge-offs in the second quarter of 2017 were attributable primarily to income producing - commercial real estate ($969 thousand) offset by recoveries in construction - commercial and residential ($343 thousand) and commercial and industrial loans ($254 thousand).

Noninterest income for the three months ended June 30, 2017 decreased to $7.0 million from $7.6 million for the three months ended June 30, 2016, due primarily to lesser net gains on the sale of investments ($26 thousand in 2017 versus $498 thousand in 2016), a decrease of $888 thousand in gains on the sale of SBA loans, a decrease in gains on sales of residential mortgages of $584 thousand, offset by revenue associated with the origination, securitization, servicing, and sale of FHA Multifamily-Backed GNMA securities of $642 thousand (net of certain transaction expenses), an increase in other miscellaneous income of $335 thousand, and an increase in other loan income of $137 thousand. Residential mortgage loans closed were $188 million for the second quarter in 2017 versus $214 million for the second quarter of 2016. Excluding gains on sales of investment securities, noninterest income was $7.0 million in the second quarter of 2017 as compared to $7.1 million for the second quarter of 2016, a decrease of 1%.     

The efficiency ratio, which measures the ratio of noninterest expense to total revenue, was 39.10% for the second quarter of 2017, as compared to 39.63% for the second quarter of 2016. Noninterest expenses totaled $30.0 million for the three months ended June 30, 2017, as compared to $28.3 million for the three months ended June 30, 2016, a 6% increase. Cost increases for salaries and benefits were $961 thousand, due primarily to increased staff, merit increases and incentive compensation. Marketing and advertising expense increased by $327 thousand primarily due to costs associated with expanded digital and print advertising. Legal, accounting and professional fees increased by $286 thousand primarily due to enhanced IT risk management.

Analysis of the six months ended June 30, 2017 compared to June 30, 2016

For the six months ended June 30, 2017, the Company reported an annualized ROAA of 1.61% as compared to 1.56% for the six months ended June 30, 2016. The annualized ROACE for the six months ended June 30, 2017 was 12.62%, as compared to 12.39% for the six months ended June 30, 2016. The higher ratios are due to increased earnings.

Net interest income increased 8% for the six months ended June 30, 2017 over the same period in 2016 ($136.6 million versus $126.4 million), resulting from growth in average earning assets of 12%. The net interest margin was 4.16% for the six months ended June 30, 2017 as compared to 4.30% for the same period in 2016. The Company believes its net interest margin remains favorable compared to peer banking companies and that its disciplined approach to managing the loan portfolio yield to 5.13% for the first six months in 2017 has been a significant factor in its overall profitability. Additionally, the percentage of average noninterest bearing deposits to total deposits was 32% for the first six months in 2017 versus 30% for the same period in 2016.

The provision for credit losses was $3.0 million for the six months ended June 30, 2017 as compared to $6.9 million for the six months ended June 30, 2016. The lower provisioning in the first six months of 2017, as compared to the first six months of 2016, is due to lower loan growth, as net loans increased $307.1 million during the first six months of 2017, as compared to an increase of $405.1 million during the same period in 2016, and to overall improved asset quality. Net charge-offs of $989 thousand in the first six months of 2017 represented an annualized 0.03% of average loans, excluding loans held for sale, as compared to $3.1 million or an annualized 0.12% of average loans, excluding loans held for sale, in the first six months of 2016. Net charge-offs in the first six months of 2017 were attributable primarily to income producing - commercial real estate ($1.4 million) offset by recoveries in construction - commercial and residential ($346 thousand) and commercial and industrial loans ($131 thousand).

Noninterest income for the six months ended June 30, 2017 was $13.1 million as compared to $13.9 million for the six months ended June 30, 2016, a 6% decrease due primarily to lesser net gains on the sale of investments ($531 thousand in 2017 and $1.1 million in 2016), a decrease of $1.1 million in gains on the sale of SBA loans, offset by revenue associated with the origination, securitization, servicing, and sale of FHA Multifamily-Backed GNMA securities of $642 thousand (net of certain transaction expenses), and an increase in other miscellaneous income of $213 thousand. Excluding investment securities net gains, total noninterest income was $12.6 million for the six months ended June 30, 2017, as compared to $12.7 million for the same period in 2016, a 1% decrease.

Noninterest expenses totaled $59.2 million for the six months ended June 30, 2017, as compared to $56.4 million for the six months ended June 30, 2016, a 5% increase. Cost increases for salaries and benefits were $1.5 million, due primarily to increased staff and merit increases. Marketing and advertising expense increased by $447 thousand primarily due to costs associated with expanded digital and print advertising. Legal, accounting and professional fees increased by $225 thousand primarily due to enhanced IT risk management. Other expenses increased $740 thousand primarily due to higher broker fees.  For the first six months of 2017, the efficiency ratio was 39.57% as compared to 40.20% for the same period in 2016.

The financial information which follows provides more detail on the Company's financial performance for the three and six months ended June 30, 2017 as compared to the three and six months ended June 30, 2016 as well as providing eight quarters of trend data. Persons wishing additional information should refer to the Company's Form 10-K for the year ended December 31, 2016 and other reports filed with the Securities and Exchange Commission (the "SEC").

About Eagle Bancorp: The Company is the holding company for EagleBank, which commenced operations in 1998. The Bank is headquartered in Bethesda, Maryland, and operates through twenty-one branch offices, located in Montgomery County, Maryland, Washington, D.C. and Northern Virginia. The Company focuses on building relationships with businesses, professionals and individuals in its marketplace.

Conference Call: Eagle Bancorp will host a conference call to discuss its second quarter 2017 financial results on Thursday, July 20, 2017 at 10:00 a.m. eastern daylight time. The public is invited to listen to this conference call by dialing 1.877.303.6220, conference ID Code is 47807241, or by accessing the call on the Company's website, www.EagleBankCorp.com. A replay of the conference call will be available on the Company's website through August 3, 2017.

Forward-looking Statements: This press release contains forward-looking statements within the meaning of the Securities and Exchange Act of 1934, as amended, including statements of goals, intentions, and expectations as to future trends, plans, events or results of Company operations and policies and regarding general economic conditions. In some cases, forward-looking statements can be identified by use of words such as "may," "will," "anticipates," "believes," "expects," "plans," "estimates," "potential," "continue," "should," and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company's market, interest rates and interest rate policy, competitive factors, and other conditions which by their nature, are not susceptible to accurate forecast and are subject to significant uncertainty. Because of these uncertainties and the assumptions on which this discussion and the forward-looking statements are based, actual future operations and results in the future may differ materially from those indicated herein. For details on factors that could affect these expectations, see the risk factors and other cautionary language included in the Company's Annual Report on Form 10-K for the year ended December 31, 2016 and in other periodic and current reports filed with the SEC. Readers are cautioned against placing undue reliance on any such forward-looking statements. The Company's past results are not necessarily indicative of future performance.

Eagle Bancorp, Inc.                
Consolidated Financial Highlights (Unaudited)                
(dollars in thousands, except per share data)        
  Three Months Ended June 30,   Six Months Ended June 30,  
    2017       2016       2017       2016    
Income Statements:                
Total interest income $   79,344     $   69,772     $   155,138     $   137,579    
Total interest expense     9,646         5,950         18,546         11,167    
Net interest income     69,698         63,822         136,592         126,412    
Provision for credit losses     1,566         3,888         2,963         6,931    
Net interest income after provision for credit losses     68,132         59,934         133,629         119,481    
Noninterest income (before investment gains)     6,997         7,077         12,562         12,743    
Gain on sale of investment securities     26         498         531         1,122    
Total noninterest income     7,023         7,575         13,093         13,865    
Total noninterest expense      30,001         28,295         59,233         56,397    
Income before income tax expense     45,154         39,214         87,489         76,949    
Income tax expense     17,382         15,069         32,700         29,482    
Net income $   27,772     $   24,145     $   54,789     $   47,467    
                 
Per Share Data:                
Earnings per weighted average common share, basic $   0.81     $   0.72     $   1.61     $   1.41    
Earnings per weighted average common share, diluted $   0.81     $   0.71     $   1.60     $   1.39    
Weighted average common shares outstanding, basic      34,128,598         33,588,141         34,099,228         33,553,570    
Weighted average common shares outstanding, diluted      34,324,120         34,183,209         34,304,285         34,146,404    
Actual shares outstanding at period end     34,169,924         33,584,898         34,169,924         33,584,898    
Book value per common share at period end  $   26.42     $   23.48     $   26.42     $   23.48    
Tangible book value per common share at period end (1) $   23.28     $   20.27     $   23.28     $   20.27    
                 
Performance Ratios (annualized):                
Return on average assets   1.60 %     1.57 %     1.61 %     1.56 %  
Return on average common equity   12.51 %     12.40 %     12.62 %     12.39 %  
Net interest margin   4.16 %     4.30 %     4.16 %     4.30 %  
Efficiency ratio (2)   39.10 %     39.63 %     39.57 %     40.20 %  
                 
Other Ratios:                
Allowance for credit losses to total loans (3)   1.02 %     1.05 %     1.02 %     1.05 %  
Allowance for credit losses to total nonperforming loans   356.00 %     264.44 %     356.00 %     264.44 %  
Nonperforming loans to total loans (3)   0.29 %     0.40 %     0.29 %     0.40 %  
Nonperforming assets to total assets   0.26 %     0.39 %     0.26 %     0.39 %  
Net charge-offs (annualized) to average loans (3)   0.02 %     0.15 %     0.03 %     0.12 %  
Common equity to total assets   12.46 %     12.39 %     12.46 %     12.39 %  
Tier 1 capital (to average assets)   11.61 %     11.24 %     11.61 %     11.24 %  
Total capital (to risk weighted assets)   15.13 %     12.73 %     15.13 %     12.73 %  
Common equity tier 1 capital (to risk weighted assets)   11.18 %     10.74 %     11.18 %     10.74 %  
Tangible common equity ratio (1)   11.15 %     10.88 %     11.15 %     10.88 %  
                 
Loan Balances - Period End (in thousands):                
Commercial and Industrial $   1,319,736     $   1,140,863     $   1,319,736     $   1,140,863    
Commercial real estate - owner occupied  $   660,066     $   584,358     $   660,066     $   584,358    
Commercial real estate - income producing $   2,596,230     $   2,461,581     $   2,596,230     $   2,461,581    
1-4 Family mortgage $   151,115     $   150,129     $   151,115     $   150,129    
Construction - commercial and residential $   1,034,902     $   847,268     $   1,034,902     $   847,268    
Construction - C&I (owner occupied) $   116,577     $   100,063     $   116,577     $   100,063    
Home equity $   103,671     $   110,697     $   103,671     $   110,697    
Other consumer  $   2,734     $   8,470     $   2,734     $   8,470    
                 
Average Balances (in thousands):                
Total assets $   6,959,994     $   6,191,164     $   6,866,597     $   6,131,848    
Total earning assets $   6,725,251     $   5,967,008     $   6,631,111     $   5,905,962    
Total loans $   5,895,174     $   5,266,305     $   5,800,742     $   5,168,346    
Total deposits $   5,660,119     $   5,178,501     $   5,607,552     $   5,161,086    
Total borrowings $   375,124     $   207,221     $   346,791     $   173,272    
Total shareholders' equity $   890,498     $   783,318     $   875,223     $   770,117    
                 

(1) Tangible common equity to tangible assets (the "tangible common equity ratio") and tangible book value per common share are non-GAAP financial measures derived from GAAP based amounts. The Company calculates the tangible common equity ratio by excluding the balance of intangible assets from common shareholders' equity and dividing by tangible assets. The Company calculates tangible book value per common share by dividing tangible common equity by common shares outstanding, as compared to book value per common share, which the Company calculates by dividing common shareholders' equity by common shares outstanding. The Company considers this information important to shareholders as tangible equity is a measure that is consistent with the calculation of capital for bank regulatory purposes, which excludes intangible assets from the calculation of risk based ratios and as such is useful for investors, regulators, management and others to evaluate capital adequacy and to compare against other financial institutions. The table below provides a reconciliation of these non-GAAP financial measures with financial measures defined by GAAP.

             
GAAP Reconciliation (Unaudited)            
(dollars in thousands except per share data)            
  Six Months Ended   Twelve Months Ended   Six Months Ended  
  June 30, 2017   December 31, 2016   June 30, 2016  
Common shareholders' equity $   902,675     $   842,799     $   788,628    
Less: Intangible assets     (107,061 )       (107,419 )       (108,021 )  
Tangible common equity $   795,614     $   735,380     $   680,607    
             
Book value per common share $   26.42     $   24.77     $   23.48    
Less: Intangible book value per common share     (3.14 )       (3.16 )       (3.21 )  
Tangible book value per common share $   23.28     $   21.61     $   20.27    
             
Total assets $   7,244,527     $   6,890,096     $   6,365,320    
Less: Intangible assets     (107,061 )       (107,419 )       (108,021 )  
Tangible assets $   7,137,466     $   6,782,677     $   6,257,299    
Tangible common equity ratio   11.15 %     10.84 %     10.88 %  
             

(2) Computed by dividing noninterest expense by the sum of net interest income and noninterest income.

(3) Excludes loans held for sale.

           
Eagle Bancorp, Inc.          
Consolidated Balance Sheets (Unaudited)          
(dollars in thousands, except per share data)          
           
Assets June 30, 2017   December 31, 2016   June 30, 2016
Cash and due from banks $   10,948     $   10,285     $   11,013  
Federal funds sold     7,417         2,397         5,444  
Interest bearing deposits with banks and other short-term investments     429,336         355,481         230,041  
Investment securities available for sale, at fair value     497,672         538,108         409,512  
Federal Reserve and Federal Home Loan Bank stock     28,603         21,600         19,864  
Loans held for sale     49,327         51,629         59,323  
Loans      5,985,031         5,677,893         5,403,429  
Less allowance for credit losses     (61,047 )       (59,074 )       (56,536 )
Loans, net     5,923,984         5,618,819         5,346,893  
Premises and equipment, net     20,153         20,661         18,209  
Deferred income taxes     46,294         48,220         41,321  
Bank owned life insurance     60,869         60,130         59,357  
Intangible assets, net     107,061         107,419         108,021  
Other real estate owned     1,394         2,694         3,152  
Other assets     61,469         52,653         53,170  
  Total Assets $   7,244,527     $   6,890,096     $   6,365,320  
           
Liabilities and Shareholders' Equity          
Deposits:          
Noninterest bearing demand $   1,851,437     $   1,775,684     $   1,631,732  
Interest bearing transaction     405,210         289,122         293,401  
Savings and money market     2,730,981         2,902,560         2,634,446  
Time, $100,000 or more     490,105         464,842         434,102  
Other time     389,964         283,906         342,307  
Total deposits     5,867,697         5,716,114         5,335,988  
Customer repurchase agreements     74,362         68,876         80,508  
Other short-term borrowings     145,000         -          50,000  
Long-term borrowings     216,710         216,514         68,989  
Other liabilities     38,083         45,793         41,207  
Total liabilities     6,341,852         6,047,297         5,576,692  
           
Shareholders' Equity          
Common stock, par value $.01 per share; shares authorized 100,000,000, shares          
issued and outstanding 34,169,924, 34,023,850, and 33,584,898, respectively     340         338         333  
Warrant     -          -          946  
Additional paid in capital     517,356         513,531         507,602  
Retained earnings      386,100         331,311         281,071  
Accumulated other comprehensive loss      (1,121 )       (2,381 )       (1,324 )
Total Shareholders' Equity     902,675         842,799         788,628  
Total Liabilities and Shareholders' Equity $   7,244,527     $   6,890,096     $   6,365,320  

 

Eagle Bancorp, Inc.              
Consolidated Statements of Income (Unaudited)              
(dollars in thousands, except per share data)              
       
  Three Months Ended June 30,   Six Months Ended June 30,
Interest Income  2017   2016    2017    2016
Interest and fees on loans $   75,896   $   67,211   $   148,367   $   132,133
Interest and dividends on investment securities     2,827       2,356       5,660       4,944
Interest on balances with other banks and short-term investments     610       196       1,093       480
Interest on federal funds sold      11       9       18       22
Total interest income     79,344       69,772       155,138       137,579
Interest Expense              
Interest on deposits     6,403       4,530       12,233       8,673
Interest on customer repurchase agreements      40       39       78       76
Interest on other short-term borrowings     224       344       277       344
Interest on long-term borrowings     2,979       1,037       5,958       2,074
Total interest expense     9,646       5,950       18,546       11,167
Net Interest Income      69,698       63,822       136,592       126,412
Provision for Credit Losses     1,566       3,888       2,963       6,931
Net Interest Income After Provision For Credit Losses     68,132       59,934       133,629       119,481
               
Noninterest Income              
Service charges on deposits     1,543       1,424       3,015       2,872
Gain on sale of loans     2,519       3,992       4,567       5,455
Gain on sale of investment securities     26       498       531       1,122
Increase in the cash surrender value of  bank owned life insurance      372       390       739       780
Other income     2,563       1,271       4,241       3,636
Total noninterest income     7,023       7,575       13,093       13,865
Noninterest Expense              
Salaries and employee benefits     16,869       15,908       33,546       32,027
Premises and equipment expenses     3,920       3,807       7,767       7,633
Marketing and advertising     1,247       920       2,141       1,694
Data processing     1,997       1,823       4,038       3,837
Legal, accounting and professional fees     1,297       1,011       2,299       2,074
FDIC insurance     590       755       1,134       1,564
Other expenses     4,081       4,071       8,308       7,568
Total noninterest expense   30,001     28,295     59,233     56,397
Income Before Income Tax Expense     45,154       39,214       87,489       76,949
Income Tax Expense     17,382       15,069       32,700       29,482
Net Income  $   27,772   $   24,145   $   54,789   $   47,467
               
Earnings Per Common Share              
Basic $   0.81   $   0.72   $   1.61   $   1.41
Diluted $   0.81   $   0.71   $   1.60   $   1.39

 

Eagle Bancorp, Inc.
Consolidated Average Balances, Interest Yields And Rates (Unaudited)
(dollars in thousands)
               
  Three Months Ended June 30,
   2017    2016
  Average Balance Interest Average Yield/Rate   Average Balance Interest Average Yield/Rate
ASSETS              
Interest earning assets:              
Interest bearing deposits with other banks and other short-term investments $   264,319 $   610 0.93 %   $   184,821 $   196 0.43 %
Loans held for sale (1)     38,165     388 4.07 %       47,111     428 3.63 %
Loans (1) (2)      5,895,174     75,508 5.14 %       5,266,305     66,783 5.10 %
Investment securities available for sale (2)     520,951     2,827 2.18 %       460,195     2,356 2.06 %
Federal funds sold      6,642     11 0.66 %       8,576     9 0.42 %
Total interest earning assets     6,725,251     79,344 4.73 %       5,967,008     69,772 4.70 %
               
Total noninterest earning assets     294,923           279,972    
Less: allowance for credit losses     60,180           55,816    
Total noninterest earning assets     234,743           224,156    
TOTAL ASSETS $   6,959,994       $   6,191,164    
               
LIABILITIES AND SHAREHOLDERS' EQUITY              
Interest bearing liabilities:              
Interest bearing transaction $   360,574 $   337 0.37 %   $   243,836 $   152 0.25 %
Savings and money market      2,679,337     4,097 0.61 %       2,573,184     2,828 0.44 %
Time deposits      781,864     1,969 1.01 %       760,786     1,550 0.82 %
Total interest bearing deposits     3,821,775     6,403 0.67 %       3,577,806     4,530 0.51 %
Customer repurchase agreements     69,093     40 0.23 %       71,767     39 0.22 %
Other short-term borrowings     89,355     224 0.99 %       66,484     344 2.05 %
Long-term borrowings     216,676     2,979 5.44 %       68,970     1,037 5.95 %
Total interest bearing liabilities     4,196,899     9,646 0.92 %       3,785,027     5,950 0.63 %
               
Noninterest bearing liabilities:              
Noninterest bearing demand      1,838,344           1,600,695    
Other liabilities     34,253           22,124    
Total noninterest bearing liabilities     1,872,597           1,622,819    
               
Shareholders' Equity     890,498           783,318    
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $   6,959,994       $   6,191,164    
               
Net interest income   $   69,698       $   63,822  
Net interest spread     3.81 %       4.07 %
Net interest margin     4.16 %       4.30 %
Cost of funds     0.57 %       0.40 %
               
(1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $4.3 million and $3.7 million
  for the three months ended June 30, 2017 and 2016, respectively.
(2) Interest and fees on loans and investments exclude tax equivalent adjustments.     

 

Eagle Bancorp, Inc.
Consolidated Average Balances, Interest Yields and Rates (Unaudited)
(dollars in thousands)
               
  Six Months Ended June 30,
    2017       2016  
  Average Balance Interest Average Yield/Rate   Average Balance Interest Average Yield/Rate
ASSETS              
Interest earning assets:              
Interest bearing deposits with other banks and other short-term investments $   266,984 $   1,093 0.83 %   $   210,476 $   480 0.46 %
Loans held for sale (1)     33,796     670 3.96 %       38,179     701 3.67 %
Loans (1) (2)      5,800,742     147,697 5.13 %       5,168,346     131,432 5.11 %
Investment securities available for sale (2)     523,566     5,660 2.18 %       479,191     4,944 2.07 %
Federal funds sold      6,023     18 0.60 %       9,770     22 0.45 %
Total interest earning assets     6,631,111     155,138 4.72 %       5,905,962     137,579 4.68 %
               
Total noninterest earning assets     295,232           280,752    
Less: allowance for credit losses     59,746           54,866    
Total noninterest earning assets     235,486           225,886    
TOTAL ASSETS $   6,866,597       $   6,131,848    
               
LIABILITIES AND SHAREHOLDERS' EQUITY              
Interest bearing liabilities:              
Interest bearing transaction $   345,986 $   575 0.34 %   $   216,916 $   252 0.23 %
Savings and money market      2,684,900     7,961 0.60 %       2,664,106     5,348 0.40 %
Time deposits      759,942     3,697 0.98 %       753,618     3,073 0.82 %
Total interest bearing deposits     3,790,828     12,233 0.65 %       3,634,640     8,673 0.48 %
Customer repurchase agreements     69,359     78 0.23 %       71,076     76 0.22 %
Other short-term borrowings     60,808     277 0.91 %       33,242     344 2.05 %
Long-term borrowings     216,624     5,958 5.47 %       68,954     2,074 5.95 %
Total interest bearing liabilities     4,137,619     18,546 0.90 %       3,807,912     11,167 0.59 %
               
Noninterest bearing liabilities:              
Noninterest bearing demand      1,816,724           1,526,446    
Other liabilities     37,031           27,373    
Total noninterest bearing liabilities     1,853,755           1,553,819    
               
Shareholders' equity     875,223           770,117    
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $   6,866,597       $   6,131,848    
               
Net interest income   $   136,592       $   126,412  
Net interest spread     3.82 %       4.09 %
Net interest margin     4.16 %       4.30 %
Cost of funds     0.56 %       0.38 %
               
(1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $8.2 million and $7.5 million
  for the six months ended June 30, 2017 and 2016, respectively.              
(2) Interest and fees on loans and investments exclude tax equivalent adjustments.             

 

Eagle Bancorp, Inc.                              
Statements of Income and Highlights Quarterly Trends (Unaudited)                         
(dollars in thousands, except per share data)                              
  Three Months Ended 
  June 30,   March 31,   December 31,   September 30,   June 30,   March 31,   December 31,   September 30,
Income Statements:   2017       2017       2016       2016       2016       2016       2015       2015  
Total interest income $   79,344     $   75,794     $   75,795     $   72,431     $   69,772     $   67,807     $   67,311     $   63,981  
Total interest expense     9,646         8,900         8,771         7,703         5,950         5,217         4,735         4,896  
Net interest income     69,698         66,894         67,024         64,728         63,822         62,590         62,576         59,085  
Provision for credit losses     1,566         1,397         2,112         2,288         3,888         3,043         4,595         3,262  
Net interest income after provision for credit losses     68,132         65,497         64,912         62,440         59,934         59,547         57,981         55,823  
Noninterest income (before investment gains)     6,997         5,565         6,943         6,404         7,077         5,666         6,462         6,039  
Gain on sale of investment securities     26         505         71         1         498         624         30         60  
Total noninterest income     7,023         6,070         7,014         6,405         7,575         6,290         6,492         6,099  
Salaries and employee benefits     16,869         16,677         17,853         17,130         15,908         16,119         15,977         15,383  
Premises and equipment     3,920         3,847         3,699         3,786         3,807         3,826         3,970         3,974  
Marketing and advertising     1,247         894         944         857         920         774         566         762  
Merger expenses     -          -          -          -          -          -          2         2  
Other expenses     7,965         7,814         7,284         7,065         7,660         7,383         8,125         7,284  
Total noninterest expense     30,001         29,232         29,780         28,838         28,295         28,102         28,640         27,405  
Income before income tax expense     45,154         42,335         42,146         40,007         39,214         37,735         35,833         34,517  
Income tax expense     17,382         15,318         16,429         15,484         15,069         14,413         13,485         13,054  
Net income     27,772         27,017         25,717         24,523         24,145         23,322         22,348         21,463  
Preferred stock dividends      -          -          -          -          -          -          62         180  
Net income available to common shareholders $   27,772     $   27,017     $   25,717     $   24,523     $   24,145     $   23,322     $   22,286     $   21,283  
                               
                               
Per Share Data:                              
Earnings per weighted average common share, basic $   0.81     $   0.79     $   0.76     $   0.73     $   0.72     $   0.70     $   0.67     $   0.64  
Earnings per weighted average common share, diluted  $   0.81     $   0.79     $   0.75     $   0.72     $   0.71     $   0.68     $   0.65     $   0.63  
Weighted average common shares outstanding, basic    34,128,598       34,069,528       33,650,963       33,590,183       33,588,141       33,518,998       33,462,937       33,400,973  
Weighted average common shares outstanding, diluted      34,324,120         34,284,316       34,233,940       34,187,171       34,183,209       34,104,237       34,069,786       34,026,412  
Actual shares outstanding at period end   34,169,924       34,110,056       34,023,850       33,590,880       33,584,898       33,581,599       33,467,893       33,405,510  
Book value per common share at period end  $   26.42     $   25.59     $   24.77     $   24.28     $   23.48     $   22.71     $   22.07     $   21.38  
Tangible book value per common share at period end (1) $   23.28     $   22.45     $   21.61     $   21.08     $   20.27     $   19.48     $   18.83     $   18.10  
                               
Performance Ratios (annualized):                              
Return on average assets   1.60 %     1.62 %     1.46 %     1.50 %     1.57 %     1.54 %     1.50 %     1.47 %
Return on average common equity   12.51 %     12.74 %     12.26 %     12.04 %     12.40 %     12.39 %     12.08 %     11.95 %
Net interest margin   4.16 %     4.14 %     3.96 %     4.11 %     4.30 %     4.31 %     4.38 %     4.23 %
Efficiency ratio (2)   39.10 %     40.06 %     40.22 %     40.54 %     39.63 %     40.80 %     41.47 %     42.04 %
                               
Other Ratios:                              
Allowance for credit losses to total loans (3)   1.02 %     1.03 %     1.04 %     1.04 %     1.05 %     1.06 %     1.05 %     1.05 %
Allowance for credit losses to total nonperforming loans   356.00 %     416.91 %     330.49 %     255.29 %     264.44 %     249.03 %     397.95 %     347.82 %
Nonperforming loans to total loans (3)   0.29 %     0.25 %     0.31 %     0.41 %     0.40 %     0.43 %     0.26 %     0.30 %
Nonperforming assets to total assets   0.26 %     0.22 %     0.30 %     0.41 %     0.39 %     0.42 %     0.31 %     0.41 %
Net charge-offs (annualized) to average loans (3)   0.02 %     0.04 %     -0.01 %     0.14 %     0.15 %     0.09 %     0.18 %     0.16 %
Tier 1 capital (to average assets)   11.61 %     11.51 %     10.72 %     11.12 %     11.24 %     11.01 %     10.90 %     11.96 %
Total capital (to risk weighted assets)   15.13 %     14.97 %     14.89 %     15.05 %     12.71 %     12.87 %     12.75 %     13.80 %
Common equity tier 1 capital (to risk weighted assets)   11.18 %     10.97 %     10.80 %     10.83 %     10.74 %     10.83 %     10.68 %     10.48 %
Tangible common equity ratio (1)   11.15 %     10.97 %     10.84 %     10.64 %     10.88 %     10.86 %     10.56 %     10.46 %
                               
Average Balances (in thousands):                              
Total assets $   6,959,994     $ 6,772,164     $   6,984,492     $   6,492,274     $   6,191,164     $   6,072,533     $   5,907,022     $   5,775,283  
Total earning assets $   6,725,251     $   6,535,926     $   6,752,859     $   6,264,531     $   5,967,008     $   5,844,915     $   5,675,730     $   5,545,398  
Total loans $   5,895,174     $   5,705,261     $   5,591,790     $   5,422,677     $   5,266,305     $   5,070,386     $   4,859,391     $   4,636,298  
Total deposits $   5,660,119     $   5,554,402     $   5,796,516     $   5,353,834     $   5,178,501     $   5,143,670     $   4,952,282     $   4,842,706  
Total borrowings $   375,124     $   318,143     $   312,842     $   300,083     $   207,221     $   139,324     $   168,652     $   128,015  
Total shareholders' equity $   890,498     $   859,779     $   834,823     $   809,973     $   783,318     $   756,916     $   757,199     $   778,279  
                               
(1) Tangible common equity to tangible assets (the "tangible common equity ratio") and tangible book value per common share are non-GAAP financial measures derived from GAAP based amounts. The Company calculates the tangible common equity ratio by excluding the balance of intangible assets from common shareholders' equity and dividing by tangible assets. The Company calculates tangible book value per common share by dividing tangible common equity by common shares outstanding, as compared to book value per common share, which the Company calculates by dividing common shareholders' equity by common shares outstanding. The Company considers this information important to shareholders as tangible equity is a measure that is consistent with the calculation of capital for bank regulatory purposes, which excludes intangible assets from the calculation of risk based ratios and as such is useful for investors, regulators, management and others to evaluate capital adequacy and to compare against other financial institutions.
(2) Computed by dividing noninterest expense by the sum of net interest income and noninterest income.     
(3) Excludes loans held for sale.                              

 

EAGLE BANCORP, INC.
CONTACT:
Michael T. Flynn
301.986.1800

View Comments and Join the Discussion!