Market Overview

Simmons Reports Record Earnings for Second Quarter 2018

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PINE BLUFF, Ark., July 23, 2018 (GLOBE NEWSWIRE) -- Simmons First National Corporation (NASDAQ:SFNC) today announced record net income of $53.6 million for the quarter ended June 30, 2018, compared to $23.1 million for the same period in 2017, an increase of $30.5 million, or 132.2%. Diluted earnings per share were $0.58, an increase of $0.22, or 61.1%, from the same period in 2017.  Included in second quarter 2018 results were $1.1 million in net after-tax merger-related and branch right-sizing costs. Excluding the impact of these items, core earnings were $54.7 million for the quarter ended June 30, 2018, compared to $26.8 million for the quarter ended June 30, 2017, an increase of $27.9 million, or 104.3%. Core diluted earnings per share were $0.59, an increase of $0.17, or 40.5%, from the same period in 2017.

Year-to-date net income for the first half of 2018 was $104.9 million, or $1.13 diluted earnings per share, compared to $45.2 million, or $0.71 diluted earnings per share, for the same period in 2017. Excluding $2.4 million in net after-tax merger-related and branch right sizing costs, year-to-date core earnings for 2018 were $107.3 million, an increase of $58.0 million compared to the same period last year.

"We are pleased to again report record earnings for this quarter building off the strong results in the first quarter," said George A. Makris, Jr., chairman and CEO.

Makris continued, "The system conversions and integration for our most recent acquisitions are now complete and we are excited to turn our focus on expanding our products and services throughout our larger footprint."

The Company completed a 2-for-1 stock split effective February 8, 2018.  Financial statements, including earnings per share as well as other share-related disclosures, have been adjusted to include the impact of the stock split on all periods presented.

             
Selected Highlights:   2nd Qtr 2018   1st Qtr 2018   2nd Qtr 2017
             
Net income   $53.6 million   $51.3 million   $23.1 million
Diluted earnings per share   $0.58   $0.55   $0.36
Return on avg assets   1.38%   1.38%   1.05%
Return on avg common equity   10.05%   9.90%   7.65%
Return on tangible common equity   18.70%   18.77%   12.13%
             
Core earnings(1)   $54.7 million   $52.6 million   $26.8 million
Diluted core earnings per share(1)   $0.59   $0.57   $0.42
Core return on avg assets(1)   1.41%   1.41%   1.22%
Core return on avg common equity(1)   10.26%   10.15%   8.87%
Core return on tangible common equity(1)   19.06%   19.23%   13.99%
             
Efficiency ratio   52.70%   53.24%   56.04%
             
(1)    Core earnings excludes non-core items, and is a non-GAAP measurement.
       


Loans              
               
    2nd Qtr 2018   1st Qtr 2018   2nd Qtr 2017  
               
Total loans   $11.4 billion   $11.0 billion   $6.2 billion  
Legacy loans (all loans excluding loans acquired)   $7.1 billion   $6.3 billion   $5.0 billion  
Loans acquired   $4.3 billion   $4.7 billion   $1.2 billion  
               

Total loans, including those acquired, were $11.4 billion at June 30, 2018, an increase of $5.1 billion, or 82.6% from June 30, 2017. 

On a linked-quarter basis (June 30, 2018 compared to March 31, 2018), total loans increased $378.6 million, or 3.4%.  The increase includes:

  • $201 million increase in real estate loans
  • $131 million increase in commercial loans
  • $58 million increase in seasonal agricultural loan growth
  • $12 million increase in other loans
  • $23 million decrease in liquidating portfolio (indirect lending and consumer finance)
             
Deposits            
             
    2nd Qtr 2018   1st Qtr 2018   2nd Qtr 2017
             
Total deposits   $12.0 billion   $11.7 billion   $7.1 billion
Non-time deposits   $9.6 billion   $9.5 billion   $5.8 billion
Time deposits   $2.4 billion   $2.2 billion   $1.3 billion
             

At June 30, 2018, total deposits were $12.0 billion, an increase of 68.3%, compared to the same period in 2017 and a 2.5% increase from March 31, 2018. The increase is from continued focus on core deposits as a funding source for asset growth and the recent acquisitions.  Total non-time deposits increased 65.7% compared to the same period in 2017, and comprised 80.3% of total deposits.

Since last quarter, the Federal Reserve Board increased the Fed Funds target rate by 25 basis points. The Company's deposit beta was 40% and the core loan beta was 36%. Looking back to March 2017, the Federal Reserve has increased the target rate by 100 basis points. The Company's deposit beta was 51% and the core loan beta was 45% during the same period.

           
Net Interest Income          
           
  2nd Qtr
2018
1st Qtr
2018
4th Qtr
2017
3rd Qtr
2017
2nd Qtr
2017
Loan yield (1) 5.40 % 5.38 % 5.39 % 4.91 % 4.96 %
Core loan yield (1) (2) 5.04 % 4.95 % 4.75 % 4.72 % 4.63 %
Security yield (1) 2.75 % 2.67 % 2.62 % 2.64 % 2.81 %
Cost of interest bearing deposits 0.84 % 0.74 % 0.63 % 0.43 % 0.36 %
Cost of borrowed funds 2.38 % 1.70 % 1.78 % 1.52 % 1.48 %
Net interest margin (1) 3.99 % 4.17 % 4.21 % 3.91 % 4.04 %
Core net interest margin (1) (2) 3.70 % 3.82 % 3.70 % 3.77 % 3.79 %
                     
(1)    Fully tax equivalent.
(2)    Core loan yield and core net interest margin exclude accretion, and are non-GAAP measurements.
 

The Company's net interest income for the second quarter of 2018 was $136.8 million, an increase of $60.0 million, or 78.2%, from the same period of 2017. Included in interest income was the yield accretion recognized on loans acquired of $10.1 million and $4.8 million for the second quarters of 2018 and 2017, respectively. Yield accretion was $3.7 million higher than projected during the quarter due to accelerated cash flows of acquired loans. Based on its cash flow projections, the Company expects total accretion for 2018 of approximately $30 million.

Net interest margin was 3.99% for the quarter ended June 30, 2018, an 18 basis point decrease from the first quarter. The Company's core net interest margin, excluding the accretion, was 3.70% for the second quarter of 2018, a 12 basis point decrease from March 31, 2018.  Cost of interest bearing deposits was 0.84% for the second quarter of 2018, a 48 basis point increase from June 30, 2017 and a 10 basis point increase from March 31, 2018.

The subordinated debt issuance at the end of the first quarter had a 5 basis point impact on the Company's second quarter net interest margin. The timing of existing subordinated debt prepayment had an additional 5 basis point impact.

Non-Interest Income

Non-interest income for the second quarter 2018 was $38.0 million, an increase of $2.3 million compared to the second quarter of 2017. The increase was primarily due to additional trust income, service charge and fee income resulting from the acquisitions. This increase was partially offset by a $2.2 million decrease in gain on sale of securities compared to the same quarter last year.

Non-Interest Expense

Non-interest expense for the second quarter of 2018 was $98.5 million, an increase of $27.1 million compared to the second quarter of 2017. Included in this quarter were $1.5 million of pre-tax merger-related expenses and branch rightsizing costs.  Excluding these expenses, core non-interest expense was $97.0 million.

The increases during the quarter were driven by incremental increases in operating expenses related to the additions of Bank SNB and Southwest Bank during the fourth quarter of 2017. The efficiency ratio for the second quarter 2018 was 52.70%.

Income tax expense in the second quarter included a $2.0 million discrete tax benefit related to tax accounting for equity compensation.

             
Asset Quality            
             
    2nd Qtr 2018   1st Qtr 2018   2nd Qtr 2017
             
Allowance for loan losses to total loans   0.73%   0.75%   0.83%
Allowance for loan losses to non-performing loans   115%      99%      72%
Non-performing loans to total loans   0.63%   0.76%   1.15%
Net charge-off ratio (annualized)   0.17%   0.24%   0.23%
Net charge-off ratio excluding credit cards   0.13%   0.20%   0.19%
             

All loans acquired are recorded at their discounted net present value; therefore, they are excluded from the computations of the asset quality ratios for the legacy loan portfolio, except for their inclusion in total assets.

At June 30, 2018, the allowance for loan losses for legacy loans was $51.7 million. The allowance for loan losses for loans acquired was $2.1 million and the acquired loan discount credit mark was $68.3 million. The allowances for loan losses and credit marks provide a total of $122.1 million of coverage, which equates to a total coverage ratio of 1.1% of gross loans. The ratio of credit mark and related allowance to loans acquired was 1.6%.

Provision for loan losses for the second quarter of 2018 was $9.0 million which includes an increase due to strong legacy loan growth as well as increased loan migration during the quarter from the fourth quarter of 2017 acquisitions, which is consistent with the Company's previous guidance.

Foreclosed Assets and Other Real Estate Owned

At June 30, 2018, foreclosed assets and other real estate owned were $30.5 million, an increase of $4.5 million, or 17.3%, compared to the same period in 2017 and an increase of $1.4 million, or 4.7% from March 31, 2018. The composition of these assets is divided into three types:

    2nd Qtr 2018   1st Qtr 2018   2nd Qtr 2017
             
Closed bank branches, branch sites &            
associate relocation   $7.2 million   $8.1 million   $8.7 million
Foreclosed assets - acquired   $13.2 million   $14.9 million   $12.0 million
Foreclosed assets - legacy   $10.1 million   $6.1 million   $5.3 million
             


Capital            
    2nd Qtr 2018   1st Qtr 2018   2nd Qtr 2017
             
Stockholders' equity to total assets   13.3%   13.5%   13.6%
Tangible common equity to tangible assets   7.9%   7.9%   9.2%
Regulatory tier 1 leverage ratio   8.6%   8.6%   10.8%
Regulatory total risk-based capital ratio   13.7%   14.1%   13.7%
             
             

At June 30, 2018, common stockholders' equity was $2.1 billion, book value per share was $23.26 and tangible book value per share was $13.05.  Asset growth due to the subordinated debt offering and the timing related to paying off approximately $104 million in parent company debt reduced Tangible Common Equity 6 basis points.

Simmons First National Corporation

Simmons First National Corporation is a financial holding company, headquartered in Pine Bluff, Arkansas, with total assets of $16.2 billion as of June 30, 2018 conducting financial operations throughout Arkansas, Colorado, Kansas, Missouri, Oklahoma, Tennessee and Texas. The Company, through its subsidiaries, offers comprehensive financial solutions delivered with a client-centric approach. The Company's common stock trades on the NASDAQ Global Select Market under the symbol "SFNC."

Conference Call

Management will conduct a live conference call to review this information beginning at 9:00 a.m. CDT on Tuesday, July 24, 2018. Interested persons can listen to this call by dialing toll-free 1-866-298-7926 (United States and Canada only) and asking for the Simmons First National Corporation conference call, conference ID 4496437. In addition, the call will be available live or in recorded version on the Company's website at www.simmonsbank.com.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles (GAAP). The Company's management uses these non-GAAP financial measures in their analysis of the Company's performance. These measures typically adjust GAAP performance measures to include the tax benefit associated with revenue items that are tax-exempt, as well as adjust income available to common shareholders for certain significant non-core activities or nonrecurring transactions. Since the presentation of these GAAP performance measures and their impact differ between companies, management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company's core businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.

Forward-Looking Statements

Statements in this news release that are not historical facts should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any forward-looking statement speaks only as of the date of this news release, and we undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release. By nature, forward-looking statements involve inherent risk and uncertainties. Various factors, including, but not limited to, economic conditions, credit quality, interest rates, loan demand, changes in the assumptions used in making the forward-looking statements, and the Company's ability to manage and successfully integrate its mergers and acquisitions could cause actual results to differ materially from those contemplated by the forward-looking statements. Additional information on factors that might affect Simmons First National Corporation's financial results is included in its Form 10-K filing with the Securities and Exchange Commission.

FOR MORE INFORMATION CONTACT:
STEPHEN C. MASSANELLI
EVP, Chief Administrative Officer and Investor Relations Officer
Simmons First National Corporation
(870) 541-1000

Simmons First National Corporation           SFNC 
Consolidated End of Period Balance Sheets           
For the Quarters Ended   Jun 30   Mar 31   Dec 31   Sep 30   Jun 30 
(Unaudited)     2018       2018       2017       2017       2017   
($ in thousands)          
ASSETS           
Cash and non-interest bearing balances due from banks $ 162,567   $ 170,811   $ 205,025   $ 108,675   $ 112,567  
Interest bearing balances due from banks and federal funds sold     781,279       688,853       393,017       323,615       217,047  
Cash and cash equivalents   943,846     859,664     598,042     432,290     329,614  
Interest bearing balances due from banks - time   2,974     3,069     3,314     4,059     6,057  
Investment securities - held-to-maturity   333,503     352,756     368,058     406,033     419,003  
Investment securities - available-for-sale   1,938,644     1,830,113     1,589,517     1,317,420     1,190,600  
Mortgage loans held for sale   39,812     17,708     24,038     12,614     16,266  
Assets held in trading accounts   -        -        -        49     50  
Other assets held for sale   14,898     24,784     165,780     182,378     -     
Loans:          
Legacy loans   7,133,461     6,290,383     5,705,609     5,211,312     5,000,572  
Allowance for loan losses   (51,732 )   (47,207 )   (41,668 )   (42,717 )   (41,379 )
Loans acquired, net of discount and allowance     4,232,434       4,696,945       5,074,076       1,092,039       1,224,739  
Net loans   11,314,163     10,940,121     10,738,017     6,260,634     6,183,932  
Premises and equipment   288,777     289,355     287,249     224,376     230,641  
Foreclosed assets and other real estate owned   30,503     29,140     32,118     31,477     26,012  
Interest receivable   44,266     42,129     43,528     30,749     27,337  
Bank owned life insurance   191,575     186,473     185,984     148,984     148,134  
Goodwill   845,687     845,687     842,651     375,731     379,437  
Other intangible assets   96,720     99,504     106,071     55,501     58,528  
Other assets     80,165       76,806       71,439       53,075       52,697  
Total assets $   16,165,533   $   15,597,309   $   15,055,806   $   9,535,370   $   9,068,308  
               
LIABILITIES AND STOCKHOLDERS' EQUITY           
Deposits:          
Non-interest bearing transaction accounts $ 2,683,489   $ 2,734,287   $ 2,665,249   $ 1,669,860   $ 1,650,986  
Interest bearing transaction accounts and savings deposits   6,916,520     6,720,754     6,494,896     4,344,779     4,141,426  
Time deposits     2,353,439       2,201,874       1,932,730       1,310,951       1,311,123  
Total deposits   11,953,448     11,656,915     11,092,875     7,325,590     7,103,535  
Federal funds purchased and securities sold          
under agreements to repurchase   99,801     120,909     122,444     121,687     121,419  
Other borrowings   1,451,811     1,140,986     1,380,024     522,541     474,962  
Subordinated notes and debentures   413,337     468,465     140,565     67,418     67,312  
Other liabilities held for sale   1,840     2,781     157,366     176,964     -     
Accrued interest and other liabilities     98,388       98,202       77,968       63,971       67,004  
Total liabilities     14,018,625       13,488,258       12,971,242       8,278,171       7,834,232  
           
Stockholders' equity:          
Common stock   923     922     920     644     644  
Surplus   1,594,342     1,590,086     1,586,034     763,121     761,432  
Undivided profits   591,826     552,105     514,874     504,085     483,322  
Accumulated other comprehensive loss:          
Unrealized depreciation on AFS securities     (40,183 )     (34,062 )     (17,264 )     (10,651 )     (11,322 )
Total stockholders' equity     2,146,908       2,109,051       2,084,564       1,257,199       1,234,076  
Total liabilities and stockholders' equity $   16,165,533   $   15,597,309   $   15,055,806   $   9,535,370   $   9,068,308  
               
 Page 1 
           


Simmons First National Corporation           SFNC   
Consolidated Statements of Income - Quarter-to-Date             
For the Quarters Ended  Jun 30 Mar 31 Dec 31 Sep 30 Jun 30  
(Unaudited)    2018     2018     2017     2017     2017  
($ in thousands, except per share data)                              
INTEREST INCOME             
Loans $ 150,253   $ 143,350   $ 132,617   $ 77,457   $ 73,549  
Interest bearing balances due from banks and federal funds sold   1,414     1,009     947     650     214  
Investment securities   14,296     12,622     11,456     9,218     9,990  
Mortgage loans held for sale     305       158       175       159       145  
TOTAL INTEREST INCOME     166,268       157,139       145,195       87,484       83,898  
INTEREST EXPENSE                          
Time deposits   6,175     4,842     3,944     2,110     1,832  
Other deposits   12,286     10,755     8,762     3,920     2,984  
Federal funds purchased and securities            
sold under agreements to repurchase   88     110     97     83     92  
Other borrowings   5,141     5,139     3,993     1,875     1,559  
Subordinated notes and debentures     5,741       1,327       1,480       677       619  
TOTAL INTEREST EXPENSE     29,431       22,173       18,276       8,665       7,086  
NET INTEREST INCOME    136,837     134,966     126,919     78,819     76,812  
Provision for loan losses     9,033       9,150       9,601       5,462       7,023  
NET INTEREST INCOME AFTER PROVISION                               
FOR LOAN LOSSES      127,804       125,816       117,318       73,357       69,789  
NON-INTEREST INCOME                               
Trust income   5,622     5,249     6,020     4,225     4,113  
Service charges on deposit accounts   10,063     10,345     10,587     8,907     8,483  
Other service charges and fees   2,017     2,750     2,774     2,433     2,515  
Mortgage and SBA lending income   3,130     4,445     3,713     3,219     3,961  
Investment banking income   814     834     786     680     637  
Debit and credit card fees   10,105     8,796     8,801     8,864     8,659  
Bank owned life insurance income   1,102     1,103     1,101     725     859  
(Loss) gain on sale of securities, net   (7 )   6     (1,243 )   3     2,236  
Other income     5,202       4,007       4,090       7,276       4,281  
TOTAL NON-INTEREST INCOME     38,048       37,535       36,629       36,332       35,744  
NON-INTEREST EXPENSE                               
Salaries and employee benefits   55,678     56,357     49,288     35,285     34,205  
Occupancy expense, net   7,921     6,960     6,700     4,928     4,868  
Furniture and equipment expense   4,020     4,403     5,533     4,840     4,550  
Other real estate and foreclosure expense   1,382     1,020     865     1,071     517  
Deposit insurance   1,856     2,128     1,216     1,020     780  
Merger-related costs   1,465     1,711     14,044     752     6,603  
Other operating expenses     26,185       25,494       30,844       18,263       19,885  
TOTAL NON-INTEREST EXPENSE     98,507       98,073       108,490       66,159       71,408  
NET INCOME BEFORE INCOME TAXES    67,345     65,278     45,457     43,530     34,125  
Provision for income taxes     13,783       13,966       26,554       14,678       11,060  
NET INCOME  $   53,562   $   51,312   $   18,903   $   28,852   $   23,065  
BASIC EARNINGS PER SHARE  $   0.58   $   0.56   $   0.22   $   0.45   $   0.36  
DILUTED EARNINGS PER SHARE  $   0.58   $   0.55   $   0.22   $   0.44   $   0.36  
                               
 Page 2   
             


Simmons First National Corporation         SFNC 
Consolidated Risk-Based Capital           
For the Quarters Ended   Jun 30   Mar 31   Dec 31   Sep 30   Jun 30 
(Unaudited)     2018       2018       2017       2017       2017   
($ in thousands)                              
Tier 1 capital          
Stockholders' equity $ 2,146,908   $ 2,109,051   $ 2,084,564   $ 1,257,199   $ 1,234,076  
Trust preferred securities, net allowable   -        -        -        67,418     67,312  
Disallowed intangible assets, net of deferred tax   (917,050 )   (918,161 )   (902,371 )   (401,419 )   (406,990 )
Unrealized loss on AFS securities     40,183       34,062       17,264       10,651       11,322  
Total Tier 1 capital     1,270,041       1,224,952       1,199,457       933,849       905,720  
                               
Tier 2 capital          
Qualifying unrealized gain on AFS equity securities   1     8     1     1     1  
Trust preferred securities and subordinated debt   413,337     468,466     140,565     -        -     
Qualifying allowance for loan losses and          
reserve for unfunded commitments     60,691       54,436       48,947       46,709       45,369  
Total Tier 2 capital     474,029       522,910       189,513       46,710       45,370  
Total risk-based capital $   1,744,070   $   1,747,862   $   1,388,970   $   980,559   $   951,090  
                               
Common equity          
Tier 1 capital $ 1,270,041   $ 1,224,952   $ 1,199,457   $ 933,849   $ 905,720  
Less: Trust preferred securities     -          -          -          (67,418 )     (67,312 )
Total common equity $   1,270,041   $   1,224,952   $   1,199,457   $   866,431   $   838,408  
                               
Risk weighted assets $   12,713,093   $   12,417,233   $   12,234,160   $   7,239,923   $   6,925,727  
                               
Adjusted average assets for leverage ratio $   14,714,205   $   14,179,390   $   13,016,478   $   8,789,175   $   8,424,763  
                               
Ratios at end of quarter          
Equity to assets   13.28 %   13.52 %   13.85 %   13.18 %   13.61 %
Tangible common equity to tangible assets (1)   7.91 %   7.94 %   8.05 %   9.07 %   9.22 %
Common equity Tier 1 ratio (CET1)   9.99 %   9.86 %   9.80 %   11.97 %   12.11 %
Tier 1 leverage ratio   8.63 %   8.64 %   9.21 %   10.62 %   10.75 %
Tier 1 risk-based capital ratio   9.99 %   9.86 %   9.80 %   12.90 %   13.08 %
Total risk-based capital ratio   13.72 %   14.08 %   11.35 %   13.54 %   13.73 %
           
           
(1) Calculations of tangible common equity to tangible assets and the reconciliations to GAAP are included in the schedules accompanying this release.
           
 Page 3 
           


Simmons First National Corporation         SFNC   
Consolidated Loans and Investments             
For the Quarters Ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30  
(Unaudited)    2018     2018     2017     2017     2017  
($ in thousands)                              
Legacy Loan Portfolio - End of Period (1)            
Consumer            
Credit cards $ 180,352   $ 176,602   $ 185,422   $ 176,316   $ 176,953  
Other consumer     277,330       284,285       280,094       317,946       366,136  
Total consumer   457,682     460,887     465,516     494,262     543,089  
Real Estate            
Construction   967,720     786,077     614,155     515,274     457,896  
Single-family residential   1,314,787     1,193,464     1,094,633     1,048,403     1,014,412  
Other commercial     2,816,420       2,611,358       2,530,824       2,231,223       2,089,707  
Total real estate   5,098,927     4,590,899     4,239,612     3,794,900     3,562,015  
Commercial            
Commercial   1,237,910     971,704     825,217     688,960     678,932  
Agricultural     187,006       128,247       148,302       207,849       191,345  
Total commercial   1,424,916     1,099,951     973,519     896,809     870,277  
Other     151,936       138,646       26,962       25,341       25,191  
Total Loans $   7,133,461   $   6,290,383   $   5,705,609   $   5,211,312   $   5,000,572  
                               
 (1) Excludes all acquired loans.             
             
Investment Securities - End of Period            
Held-to-Maturity             
U.S. Government agencies $ 36,976   $ 46,961   $ 46,945   $ 66,928   $ 67,912  
Mortgage-backed securities   14,645     15,404     16,132     16,972     17,882  
State and political subdivisions   279,787     286,901     301,491     320,116     331,249  
Other securities     2,095       3,490       3,490       2,017       1,960  
Total held-to-maturity     333,503       352,756       368,058       406,033       419,003  
Available-for-Sale                               
U.S. Treasury $ -      $ -      $ -      $ -      $ 19,997  
U.S. Government agencies   145,767     149,804     139,724     208,220     147,619  
Mortgage-backed securities   1,395,231     1,356,179     1,187,317     959,698     878,205  
State and political subdivisions   245,335     185,888     143,165     84,822     83,672  
FHLB stock   72,042     58,177     58,914     24,415     21,772  
Other securities     80,269       80,065       60,397       40,265       39,335  
Total available-for-sale     1,938,644       1,830,113       1,589,517       1,317,420       1,190,600  
Total investment securities $   2,272,147   $   2,182,869   $   1,957,575   $   1,723,453   $   1,609,603  
Fair value - HTM investment securities $   334,857   $   354,649   $   373,298   $   412,140   $   425,263  
                               
Investment Securities - QTD Average            
Taxable securities $ 1,750,172   $ 1,618,270   $ 1,569,173   $ 1,229,172   $ 1,244,071  
Tax exempt securities     514,838       460,675       446,040       409,062       467,420  
Total investment securities - QTD average $   2,265,010   $   2,078,945   $   2,015,213   $   1,638,234   $   1,711,491  
             
 Page 4   
             


Simmons First National Corporation           SFNC   
Consolidated Loans and Credit Coverage             
For the Quarters Ended  Jun 30 Mar 31 Dec 31 Sep 30 Jun 30  
(Unaudited)    2018     2018     2017     2017     2017    
 ($ in thousands)                                 
LOANS            
Legacy loans $ 7,133,461   $ 6,290,383   $ 5,705,609   $ 5,211,312   $ 5,000,572    
Allowance for loan losses (legacy loans)     (51,732 )     (47,207 )     (41,668 )     (42,717 )     (41,379 )  
Legacy loans (net of allowance)   7,081,729     6,243,176     5,663,941     5,168,595     4,959,193    
Loans acquired   4,302,760     4,776,439     5,163,769     1,117,424     1,253,539    
Credit discount   (68,282 )   (79,087 )   (89,275 )   (24,994 )   (28,409 )  
Allowance for loan losses (loans acquired)     (2,044 )     (407 )     (418 )     (391 )     (391 )  
Loans acquired (net of discount and allowance)     4,232,434       4,696,945       5,074,076       1,092,039       1,224,739    
Net loans $   11,314,163   $   10,940,121   $   10,738,017   $   6,260,634   $   6,183,932    
                                 
             
Loan Coverage Ratios             
Allowance for loan losses to legacy loans   0.73 %   0.75 %   0.73 %   0.82 %   0.83 %  
             
Discount for credit losses and allowance on loans acquired            
to total loans acquired plus discount for credit losses            
and allowance on loans acquired (non-GAAP) (1)   1.63 %   1.66 %   1.74 %   2.27 %   2.30 %  
             
Total allowance and credit coverage (non-GAAP) (1)   1.07 %   1.14 %   1.21 %   1.08 %   1.12 %  
             
             
(1) Calculations of the non-GAAP loan coverage ratios and the reconciliations to GAAP are included in the schedules accompanying this release.  
             
 Page 5 
             


Simmons First National Corporation         SFNC 
Consolidated Allowance and Asset Quality           
For the Quarters Ended  Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited)    2018     2018     2017     2017     2017  
($ in thousands)          
Allowance for Loan Losses (Legacy Loans)          
Balance, beginning of quarter $  47,207   $  41,668   $  42,717   $  41,379   $  37,865  
Loans charged off                              
Credit cards   1,012     999     943     1,017     901  
Other consumer   1,366     1,056     781     819     993  
Real estate   161     455     4,725     896     1,712  
Commercial   790     1,761     4,754     2,442     349  
Total loans charged off   3,329     4,271     11,203     5,174     3,955  
                               
Recoveries of loans previously charged off          
Credit cards   286     263     233     275     277  
Other consumer   133     94     468     445     636  
Real estate   112     302     233     309     216  
Commercial   59     69     20     21     32  
Total recoveries   590     728     954     1,050     1,161  
Net loans charged off   2,739     3,543     10,249     4,124     2,794  
Provision for loan losses   7,264     9,082     9,200     5,462     6,308  
Balance, end of quarter $ 51,732   $ 47,207   $ 41,668   $ 42,717   $ 41,379  
                               
Non-performing assets (1) (2)          
Non-performing loans          
Nonaccrual loans $ 44,548   $ 47,395   $ 45,642   $ 54,439   $ 57,127  
Loans past due 90 days or more   303     336     520     232      281  
Total non-performing loans   44,851     47,731     46,162     54,671     57,408  
Other non-performing assets                              
Foreclosed assets and other real estate owned (2)   30,503     29,140     32,118     31,477     26,012  
Other non-performing assets   573     794     675     639     485  
Total other non-performing assets   31,076     29,934     32,793     32,116     26,497  
Total non-performing assets $ 75,927   $ 77,665   $ 78,955   $ 86,787   $ 83,905  
Performing TDRs (troubled debt restructurings) $ 6,367   $ 6,459   $ 7,107   $ 9,212   $ 8,794  
           
Ratios (1) (2)          
Allowance for loan losses to total loans   0.73 %   0.75 %   0.73 %   0.82 %   0.83 %
Allowance for loan losses to non-performing loans   115 %   99 %   90 %   78 %   72 %
Non-performing loans to total loans   0.63 %   0.76 %   0.81 %   1.05 %   1.15 %
Non-performing assets (including performing TDRs)          
to total assets   0.51 %   0.54 %   0.57 %   1.01 %   1.02 %
Non-performing assets to total assets   0.47 %   0.50 %   0.52 %   0.91 %   0.93 %
Annualized net charge offs to total loans   0.17 %   0.24 %   0.53 %   0.32 %   0.23 %
Annualized net credit card charge offs to          
total credit card loans   1.60 %   1.63 %   1.54 %   1.65 %   1.42 %
Annualized net charge offs to total loans          
(excluding credit cards)   0.13 %   0.20 %   0.51 %   0.27 %   0.19 %
           
 (1) Excludes all acquired loans, except for their inclusion in total assets.       
 (2) Includes acquired foreclosed assets and acquired other real estate owned.       
 Page 6 
           


Simmons First National Corporation                     SFNC 
Consolidated - Average Balance Sheet and Net Interest Income Analysis               
For the Quarters Ended                       
(Unaudited)                       
   Three Months Ended
Jun 2018 
   Three Months Ended
Mar 2018 
   Three Months Ended
Jun 2017 
 ($ in thousands)  Average
Balance
  Income/
Expense
  Yield/
Rate
  Average
Balance
  Income/
Expense
  Yield/
Rate
  Average
Balance
  Income/
Expense
  Yield/
Rate
ASSETS                                  
Earning assets:                      
Interest bearing balances due from banks                      
and federal funds sold $ 422,987   $ 1,414   1.34 %   $ 338,505   $ 1,009   1.21 %   $ 163,396   $ 214   0.53 %
Investment securities - taxable   1,982,105     10,764   2.18 %     1,785,874     9,599   2.18 %     1,374,261     6,874   2.01 %
Investment securities - non-taxable (FTE)   282,905     4,771   6.76 %     293,071     4,083   5.65 %     337,230     5,118   6.09 %
Mortgage loans held for sale   28,688     305   4.26 %     14,775     158   4.34 %     12,250     145   4.75 %
Assets held in trading accounts   -        -      0.00 %     -        -      0.00 %     52     -      0.00 %
Loans, including acquired loans     11,159,872       150,322   5.40 %       10,819,324       143,420   5.38 %       5,954,019       73,629   4.96 %
Total interest earning assets (FTE)   13,876,557       167,576   4.84 %     13,251,549       158,269   4.84 %     7,841,208       85,980   4.40 %
Non-earning assets     1,704,140             1,836,661             971,252      
Total assets $   15,580,697         $   15,088,210         $   8,812,460      
                       
LIABILITIES AND STOCKHOLDERS' EQUITY                    
Interest bearing liabilities:                      
Interest bearing transaction and                      
savings accounts $ 6,570,471   $ 12,286   0.75 %   $ 6,579,295   $ 10,755   0.66 %   $ 4,069,179   $ 2,984   0.29 %
Time deposits     2,233,673       6,175   1.11 %       2,003,668       4,842   0.98 %       1,277,336       1,832   0.58 %
Total interest bearing deposits   8,804,144     18,461   0.84 %     8,582,963     15,597   0.74 %     5,346,515     4,816   0.36 %
Federal funds purchased and securities                      
sold under agreement to repurchase   107,205     88   0.33 %     120,443     110   0.37 %     115,101     92   0.32 %
Other borrowings   1,273,135     5,141   1.62 %     1,282,527     5,139   1.63 %     434,584     1,559   1.44 %
Subordinated notes and debentures     466,612       5,741   4.93 %       162,813       1,327   3.31 %       64,019       619   3.88 %
Total interest bearing liabilities   10,651,096       29,431   1.11 %     10,148,746       22,173   0.89 %     5,960,219       7,086   0.48 %
Non-interest bearing liabilities:                      
Non-interest bearing deposits   2,705,677           2,632,182           1,597,550      
Other liabilities     86,827             204,230             45,348      
Total liabilities   13,443,600           12,985,158           7,603,117      
Stockholders' equity     2,137,097             2,103,052             1,209,343      
Total liabilities and stockholders' equity $   15,580,697         $   15,088,210         $   8,812,460      
Net interest income (FTE)   $   138,145         $   136,096         $   78,894    
Net interest spread (FTE)     3.73 %       3.95 %       3.92 %
Net interest margin (FTE) - quarter-to-date     3.99 %       4.17 %       4.04 %
                       
Net interest margin (FTE) - year-to-date     4.08 %       4.17 %       4.04 %
                       
Core net interest margin (FTE) - quarter-to-date (1)     3.70 %       3.82 %       3.79 %
Core loan yield (FTE) - quarter-to-date (1)     5.04 %       4.95 %       4.63 %
                       
Core net interest margin (FTE) - year-to-date (1)     3.76 %       3.82 %       3.79 %
Core loan yield (FTE) - year-to-date (1)     4.99 %       4.95 %       4.61 %
                       
(1) Calculations of core net interest margin and core loan yield and the reconciliations to GAAP are included in the schedules accompanying this release.  
 
Page 7
                       


Simmons First National Corporation         SFNC   
Consolidated - Selected Financial Data             
For the Quarters Ended  Jun 30 Mar 31 Dec 31 Sep 30 Jun 30  
(Unaudited)    2018     2018     2017      2017     2017    
($ in thousands, except share data)                                
QUARTER-TO-DATE            
Financial Highlights - GAAP            
Net Income $ 53,562   $ 51,312   $ 18,903   $ 28,852   $ 23,065    
Diluted earnings per share   0.58     0.55     0.22     0.44     0.36    
Return on average assets   1.38%     1.38%     0.54%     1.25%     1.05%    
Return on average common equity   10.05%     9.90%     3.88%     9.12%     7.65%    
Return on tangible common equity   18.70%     18.77%     7.53%     14.47%     12.13%    
Net interest margin (FTE)   3.99%     4.17%     4.21%     3.91%     4.04%    
FTE adjustment   1,308     1,130     1,925     1,751     2,082    
Amortization of intangibles   2,785     2,837     2,839     1,724     1,553    
Amortization of intangibles, net of taxes   2,057     2,096     1,725     1,048     944    
Average diluted shares outstanding   92,733,140     92,638,765     87,036,044     64,847,592     64,051,560    
Cash dividends declared per common share   0.15     0.15     0.13     0.13     0.13    
Financial Highlights - Core (non-GAAP)            
Core earnings (excludes non-core items) (1) $ 54,660   $ 52,618   $ 42,018   $ 27,746   $ 26,753    
Diluted core earnings per share (1)   0.59     0.57     0.48     0.43     0.42    
Core net interest margin (FTE) (2)   3.70%     3.82%     3.70%     3.77%     3.79%    
Accretable yield on acquired loans   10,113     11,294     15,684     2,890     4,792    
Efficiency ratio (1)   52.70%     53.24%     51.36%     55.06%     56.04%    
Core return on average assets (1)   1.41%     1.41%     1.20%     1.20%     1.22%    
Core return on average common equity (1)   10.26%     10.15%     8.63%     8.77%     8.87%    
Core return on tangible common equity (1)   19.06%     19.23%     15.97%     13.93%     13.99%    
YEAR-TO-DATE            
Financial Highlights - GAAP            
Net Income $ 104,874   $ 51,312   $ 92,940   $ 74,037   $ 45,185    
Diluted earnings per share   1.13     0.55     1.33     1.16     0.71    
Return on average assets   1.38%     1.38%     0.92%     1.12%     1.06%    
Return on average common equity   9.98%     9.90%     6.68%     8.18%     7.67%    
Return on tangible common equity   18.73%     18.77%     11.26%     12.97%     12.17%    
Net interest margin (FTE)   4.08%     4.17%     4.07%     3.99%     4.04%    
FTE adjustment   2,438     1,130     7,723     5,798     4,047    
Amortization of intangibles   5,622     2,837     7,666     4,827     3,103    
Amortization of intangibles, net of taxes   4,153     2,096     4,659     2,934     1,886    
Average diluted shares outstanding   92,692,234     92,638,765     69,852,920     64,014,270     63,588,726    
Cash dividends declared per common share   0.30     0.15     0.50     0.38     0.25    
Financial Highlights - Core (non-GAAP)            
Core earnings (excludes non-core items) (1) $ 107,278   $ 52,618   $ 119,049   $ 77,031   $ 49,285    
Diluted core earnings per share (1)   1.16     0.57     1.70     1.20     0.78    
Core net interest margin (FTE) (2)   3.76%     3.82%     3.76%     3.79%     3.79%    
Accretable yield on acquired loans   21,407     11,294     27,793     12,109     9,219    
Efficiency ratio (1)   52.97%     53.24%     55.27%     57.25%     58.40%    
Core return on average assets (1)   1.41%     1.41%     1.18%     1.17%     1.15%    
Core return on average common equity (1)   10.20%     10.15%     8.56%     8.51%     8.37%    
Core return on tangible common equity (1)   19.14%     19.23%     14.28%     13.48%     13.23%    
END OF PERIOD            
Book value per share $ 23.26   $ 22.86   $ 22.65   $ 19.51   $ 19.16    
Tangible book value per share   13.05     12.62     12.34     12.82     12.36    
Shares outstanding   92,281,370     92,242,389     92,029,118     64,424,484     64,425,664    
Full-time equivalent employees   2,659     2,626     2,640     1,942     1,919    
Total number of financial centers   199     200     200     156     161    
             
 (1) Core earnings exclude non-core items, which is a non-GAAP measurement. Reconciliations to GAAP are included in the schedules accompanying this release.   
 (2) Excludes accretable yield adjustment on loans, which is a non-GAAP measurement. Reconciliations to GAAP are included in the schedules accompanying this release.   
             
 Page 8   
             


Simmons First National Corporation         SFNC   
Consolidated - Reconciliation of Core Earnings (non-GAAP)         
For the Quarters Ended  Jun 30 Mar 31 Dec 31 Sep 30 Jun 30  
(Unaudited)    2018     2018     2017     2017     2017    
($ in thousands, except per share data)            
QUARTER-TO-DATE            
Net Income $ 53,562   $ 51,312   $ 18,903   $ 28,852   $ 23,065    
Non-core items            
Gain on sale of P&C insurance business   -        -        -        (3,708 )   -       
Donation to Simmons Foundation   -        -        5,000     -        -       
Merger-related costs   1,465     1,711     14,044     752     6,603    
Branch right-sizing   22     57     116     435     (536 )  
Tax effect (1)     (389 )     (462 )     (7,516 )     1,415       (2,379 )  
Net non-core items (before SAB 118 adjustment)   1,098     1,306     11,644     (1,106 )   3,688    
SAB 118 adjustment (2)     -        -          11,471       -          -       
Core earnings (non-GAAP) $   54,660   $   52,618   $   42,018   $   27,746   $   26,753    
                                 
Diluted earnings per share $ 0.58   $ 0.55   $ 0.22   $ 0.44   $ 0.36    
Non-core items            
Gain on sale of P&C insurance business   -        -        -        (0.06 )   -       
Donation to Simmons Foundation   -        -        0.06     -        -       
Merger-related costs   0.02     0.02     0.17     0.01     0.11    
Branch right-sizing   -        -        -        0.01     (0.01 )  
Tax effect (1)     (0.01 )         (0.10 )     0.03       (0.04 )  
Net non-core items (before SAB 118 adjustment)   0.01     0.02     0.13     (0.01 )   0.06    
SAB 118 adjustment (2)     -          -          0.13       -          -       
Core earnings (non-GAAP) $   0.59   $   0.57   $   0.48   $   0.43   $   0.42    
                                 
YEAR-TO-DATE            
Net Income $ 104,874   $ 51,312   $ 92,940   $ 74,037   $ 45,185    
Non-core items            
Gain on sale of P&C insurance business   -        -        (3,708 )   (3,708 )   -       
Donation to Simmons Foundation   -        -        5,000     -        -       
Merger-related costs   3,176     1,711     21,923     7,879     7,127    
Branch right-sizing   79     57     169     53     (382 )  
Tax effect (1)     (851 )     (462 )     (8,746 )     (1,230 )     (2,645 )  
Net non-core items (before SAB 118 adjustment)   2,404     1,306     14,638     2,994     4,100    
SAB 118 adjustment (2)     -          -          11,471       -          -       
Core earnings (non-GAAP) $   107,278   $   52,618   $   119,049   $   77,031   $   49,285    
                                 
Diluted earnings per share $ 1.13   $ 0.55   $ 1.33   $ 1.16   $ 0.71    
Non-core items            
Gain on sale of P&C insurance business   -        -        (0.04 )   (0.06 )   -       
Donation to Simmons Foundation   -        -        0.07        
Merger-related costs   0.04     0.02     0.31     0.12     0.12    
Branch right-sizing   -     -     -     -     (0.01 )  
Tax effect (1)     (0.01 )     -        (0.13 )     (0.02 )     (0.04 )  
Net non-core items (before SAB 118 adjustment)   0.03     0.02     0.21     0.04     0.07    
SAB 118 adjustment (2)     -          -          0.16       -          -       
Core earnings (non-GAAP) $   1.16   $   0.57   $   1.70   $   1.20   $   0.78    
                                 
 (1) Effective tax rate of 26.135% for 2018 and 39.225% for prior years, adjusted for non-deductible merger-related costs and deferred tax items on P&C insurance sale.   
 (2) Tax adjustment to revalue deferred tax assets and liabilities to account for the future impact of lower corporate tax rates resulting from the "Tax Cuts and Jobs Act", signed into law on December 22, 2017.   
       
 Page 9   
             


Simmons First National Corporation          SFNC   
Reconciliation Of Non-GAAP Financial Measures - End of Period         
For the Quarters Ended             
(Unaudited)  Jun 30 Mar 31 Dec 31 Sept 30 Jun 30  
    2018     2018     2017     2017     2017    
($ in thousands, except per share data)                                
             
Calculation of Tangible Common Equity and the Ratio of Tangible Common Equity to Tangible Assets      
             
Total common stockholders' equity $ 2,146,908   $ 2,109,051   $ 2,084,564   $ 1,257,199   $ 1,234,076    
Intangible assets:            
Goodwill   (845,687 )   (845,687 )   (842,651 )   (375,731 )   (379,437 )  
Other intangible assets   (96,720 )   (99,504 )   (106,071 )   (55,501 )   (58,528 )  
Total intangibles   (942,407 )   (945,191 )   (948,722 )   (431,232 )   (437,965 )  
Tangible common stockholders' equity $ 1,204,501   $ 1,163,860   $ 1,135,842   $ 825,967   $ 796,111    
                                 
Total assets $ 16,165,533   $ 15,597,309   $ 15,055,806   $ 9,535,370   $ 9,068,308    
Intangible assets:            
Goodwill   (845,687 )   (845,687 )   (842,651 )   (375,731 )   (379,437 )  
Other intangible assets   (96,720 )   (99,504 )   (106,071 )   (55,501 )   (58,528 )  
Total intangibles   (942,407 )   (945,191 )   (948,722 )   (431,232 )   (437,965 )  
Tangible assets $ 15,223,126   $ 14,652,118   $ 14,107,084   $ 9,104,138   $ 8,630,343    
                                 
Ratio of equity to assets   13.28 %   13.52 %   13.85 %   13.18 %   13.61 %  
Ratio of tangible common equity to tangible assets   7.91 %   7.94 %   8.05 %   9.07 %   9.22 %  
                                 
Calculation of Discount for credit losses and allowance on loans acquired to total loans acquired plus       
  discount for credit losses and allowance on loans acquired            
             
Credit discount on acquired loans $ 68,282   $ 79,087   $ 89,275   $ 24,994   $ 28,409    
Allowance for loan losses on acquired loans   2,044     407     418     391     391    
Total credit discount and ALLL on acquired loans $ 70,326   $ 79,494   $ 89,693   $ 25,385   $ 28,800    
Total loans acquired $ 4,302,760   $ 4,776,439   $ 5,163,769   $ 1,117,424   $ 1,253,539    
Discount and ALLL on acquired loans to acquired loans   1.63 %   1.66 %   1.74 %   2.27 %   2.30 %  
                                 
Calculation of Total Allowance and Credit Coverage            
             
Allowance for loan losses $ 51,732   $ 47,207   $ 41,668   $ 42,717   $ 41,379    
Total credit discount and ALLL on acquired loans   70,326     79,494     89,693     25,385     28,800    
Total allowance and credit discount $ 122,058   $ 126,701   $ 131,361   $ 68,102   $ 70,179    
Total loans $ 11,436,221   $ 11,066,822   $ 10,869,378   $ 6,328,736   $ 6,254,155    
Total allowance and credit coverage   1.07 %   1.14 %   1.21 %   1.08 %   1.12 %  
                                 
Calculation of Tangible Book Value per Share            
             
Total common stockholders' equity $ 2,146,908   $ 2,109,051   $ 2,084,564   $ 1,257,199   $ 1,234,076    
Intangible assets:            
Goodwill   (845,687 )   (845,687 )   (842,651 )   (375,731 )   (379,437 )  
Other intangible assets   (96,720 )   (99,504 )   (106,071 )   (55,501 )   (58,528 )  
Total intangibles   (942,407 )   (945,191 )   (948,722 )   (431,232 )   (437,965 )  
Tangible common stockholders' equity $ 1,204,501   $ 1,163,860   $ 1,135,842   $ 825,967   $ 796,111    
Shares of common stock outstanding   92,281,370     92,242,389     92,029,118     64,424,484     64,425,664    
Book value per common share $ 23.26   $ 22.86   $ 22.65   $ 19.51   $ 19.16    
Tangible book value per common share $ 13.05   $ 12.62   $ 12.34   $ 12.82   $ 12.36    
                                 
 Page 10   
   


Simmons First National Corporation          SFNC   
Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date         
For the Quarters Ended             
(Unaudited)   Jun 30   Mar 31   Dec 31   Sept 30   Jun 30   
     2018       2018       2017       2017       2017     
($ in thousands)                                
Calculation of Core Return on Average Assets            
             
Net income $ 53,562   $ 51,312   $ 18,903   $ 28,852   $ 23,065    
Net non-core items, net of taxes, adjustment   1,098     1,306     23,115     (1,106 )   3,688    
Core earnings $ 54,660   $ 52,618   $ 42,018   $ 27,746   $ 26,753    
                                 
Average total assets $ 15,580,697   $ 15,088,210   $ 13,897,778   $ 9,175,607   $ 8,812,460    
                                 
Return on average assets   1.38 %   1.38 %   0.54 %   1.25 %   1.05 %  
Core return on average assets   1.41 %   1.41 %   1.20 %   1.20 %   1.22 %  
                                 
Calculation of Return on Tangible Common Equity            
             
Net income $ 53,562   $ 51,312   $ 18,903   $ 28,852   $ 23,065    
Amortization of intangibles, net of taxes   2,057     2,096     1,725     1,048     944    
Total income available to common stockholders $ 55,619   $ 53,408   $ 20,628   $ 29,900   $ 24,009    
                                 
Net non-core items, net of taxes   1,098     1,306     23,115     (1,106 )   3,688    
Core earnings   54,660     52,618     42,018     27,746     26,753    
Amortization of intangibles, net of taxes   2,057     2,096     1,725     1,048     944    
Total core income available to common stockholders $ 56,717   $ 54,714   $ 43,743   $ 28,794   $ 27,697    
                                 
Average common stockholders' equity $ 2,137,097   $ 2,103,052   $ 1,931,804   $ 1,255,694   $ 1,209,343    
Average intangible assets:            
Goodwill   (845,687 )   (844,148 )   (731,661 )   (378,387 )   (362,925 )  
Other intangibles   (98,152 )   (104,718 )   (113,770 )   (57,232 )   (52,419 )  
Total average intangibles   (943,839 )   (948,866 )   (845,431 )   (435,619 )   (415,344 )  
Average tangible common stockholders' equity $ 1,193,258   $ 1,154,186   $ 1,086,373   $ 820,075   $ 793,999    
                                 
Return on average common equity   10.05 %   9.90 %   3.88 %   9.12 %   7.65 %  
Return on tangible common equity   18.70 %   18.77 %   7.53 %   14.47 %   12.13 %  
Core return on average common equity   10.26 %   10.15 %   8.63 %   8.77 %   8.87 %  
Core return on tangible common equity   19.06 %   19.23 %   15.97 %   13.93 %   13.99 %  
                                 
Calculation of Efficiency Ratio (1)            
             
Non-interest expense $ 98,507   $ 98,073   $ 108,490   $ 66,159   $ 71,408    
Non-core non-interest expense adjustment   (1,483 )   (1,772 )   (19,160 )   (862 )   (6,700 )  
Other real estate and foreclosure expense adjustment   (1,382 )   (1,020 )   (865 )   (1,071 )   (517 )  
Amortization of intangibles adjustment   (2,785 )   (2,837 )   (2,839 )   (1,724 )   (1,553 )  
Efficiency ratio numerator $ 92,857   $ 92,444   $ 85,626   $ 62,502   $ 62,638    
                                 
Net-interest income $ 136,837   $ 134,966   $ 126,919   $ 78,819   $ 76,812    
Non-interest income   38,048     37,535     36,629     36,332     35,744    
Non-core non-interest income adjustment   4     (4 )   -     (3,383 )   (632 )  
Fully tax-equivalent adjustment   1,308     1,130     1,925     1,751     2,082    
(Gain) loss on sale of securities   7     (6 )   1,243     (3 )   (2,236 )  
Efficiency ratio denominator $ 176,204   $ 173,621   $ 166,716   $ 113,516   $ 111,770    
                                 
Efficiency ratio (1)   52.70 %   53.24 %   51.36 %   55.06 %   56.04 %  
                                 
Calculation of Core Net Interest Margin            
             
Net interest income $ 136,837   $ 134,966   $ 126,919   $ 78,819   $ 76,812    
Fully tax-equivalent adjustment   1,308     1,130     1,925     1,751     2,082    
Fully tax-equivalent net interest income   138,145     136,096     128,844     80,570     78,894    
             
Total accretable yield   (10,113 )   (11,294 )   (15,684 )   (2,890 )   (4,792 )  
Core net interest income $ 128,032   $ 124,802   $ 113,160   $ 77,680   $ 74,102    
Average earning assets $ 13,876,557   $ 13,251,549   $ 12,145,003   $ 8,182,292   $ 7,841,208    
                                 
Net interest margin   3.99 %   4.17 %   4.21 %   3.91 %   4.04 %  
Core net interest margin   3.70 %   3.82 %   3.70 %   3.77 %   3.79 %  
                                 
Calculation of Core Loan Yield            
             
Loan interest income $ 150,253   $ 143,350   $ 132,617   $ 77,457   $ 73,549    
Total accretable yield   (10,113 )   (11,294 )   (15,684 )   (2,890 )   (4,792 )  
Core loan interest income $ 140,140   $ 132,056   $ 116,933   $ 74,567   $ 68,757    
Average loan balance $ 11,159,872   $ 10,819,324   $ 9,772,043   $ 6,261,507   $ 5,954,019    
                                 
Core loan yield   5.04 %   4.95 %   4.75 %   4.72 %   4.63 %  
                                 
(1) Efficiency ratio is noninterest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and noninterest revenues, excluding gains and losses from securities transactions and non-core items.  
             
 Page 11   
   


Simmons First National Corporation          SFNC   
Reconciliation Of Non-GAAP Financial Measures - Year-to-Date           
For the Quarters Ended             
(Unaudited)   Jun 30   Mar 31   Dec 31   Sept 30   Jun 30   
     2018       2018       2017       2017       2017     
($ in thousands)            
Calculation of Core Return on Average Assets            
             
Net income $ 104,874   $ 51,312   $ 92,940   $ 74,037   $ 45,185    
Net non-core items, net of taxes, adjustment   2,404     1,306     26,109     2,994     4,100    
Core earnings $ 107,278   $ 52,618   $ 119,049   $ 77,031   $ 49,285    
                                 
Average total assets $ 15,334,453   $ 15,088,210   $ 10,074,951   $ 8,800,675   $ 8,613,240    
                                 
Return on average assets   1.38 %   1.38 %   0.92 %   1.12 %   1.06 %  
Core return on average assets   1.41 %   1.41 %   1.18 %   1.17 %   1.15 %  
                                 
Calculation of Return on Tangible Common Equity            
             
Net income $ 104,874   $ 51,312   $ 92,940   $ 74,037   $ 45,185    
Amortization of intangibles, net of taxes   4,153     2,096     4,659     2,934     1,886    
Total income available to common stockholders $ 109,027   $ 53,408   $ 97,599   $ 76,971   $ 47,071    
                                 
Net non-core items, net of taxes   2,404     1,306     26,109     2,994     4,100    
Core earnings   107,278     52,618     119,049     77,031     49,285    
Amortization of intangibles, net of taxes   4,153     2,096     4,659     2,934     1,886    
Total core income available to common stockholders $ 111,431   $ 54,714   $ 123,708   $ 79,965   $ 51,171    
                                 
Average common stockholders' equity $ 2,120,075   $ 2,103,052   $ 1,390,815   $ 1,210,487   $ 1,187,906    
Average intangible assets:            
Goodwill   (844,917 )   (844,148 )   (455,453 )   (363,383 )   (355,881 )  
Other intangibles   (101,435 )   (104,718 )   (68,896 )   (53,941 )   (52,294 )  
Total average intangibles   (946,352 )   (948,866 )   (524,349 )   (417,324 )   (408,175 )  
Average tangible common stockholders' equity $ 1,173,723   $ 1,154,186   $ 866,466   $ 793,163   $ 779,731    
                                 
Return on average common equity   9.98 %   9.90 %   6.68 %   8.18 %   7.67 %  
Return on tangible common equity   18.73 %   18.77 %   11.26 %   12.97 %   12.17 %  
Core return on average common equity   10.20 %   10.15 %   8.56 %   8.51 %   8.37 %  
Core return on tangible common equity   19.14 %   19.23 %   14.28 %   13.48 %   13.23 %  
                                 
Calculation of Efficiency Ratio (1)            
             
Non-interest expense $ 196,580   $ 98,073   $ 312,379   $ 203,889   $ 137,730    
Non-core non-interest expense adjustment   (3,255 )   (1,772 )   (27,357 )   (8,197 )   (7,335 )  
Other real estate and foreclosure expense adjustment   (2,402 )   (1,020 )   (3,042 )   (2,177 )   (1,067 )  
Amortization of intangibles adjustment   (5,622 )   (2,837 )   (7,666 )   (4,827 )   (3,103 )  
Efficiency ratio numerator $ 185,301   $ 92,444   $ 274,314   $ 188,688   $ 126,225    
                                 
Net-interest income $ 271,803   $ 134,966   $ 354,930   $ 228,011   $ 149,192    
Non-interest income   75,583     37,535     138,765     102,136     65,804    
Non-core non-interest income adjustment   -     (4 )   (3,972 )   (3,972 )   (589 )  
Fully tax-equivalent adjustment   2,438     1,130     7,723     5,798     4,047    
(Gain) loss on sale of securities   1     (6 )   (1,059 )   (2,302 )   (2,299 )  
Efficiency ratio denominator $ 349,825   $ 173,621   $ 496,387   $ 329,671   $ 216,155    
                                 
Efficiency ratio (1)   52.97 %   53.24 %   55.27 %   57.25 %   58.40 %  
                                 
Calculation of Core Net Interest Margin            
             
Net interest income $ 271,803   $ 134,966   $ 354,930   $ 228,011   $ 149,192    
Fully tax-equivalent adjustment   2,438     1,130     7,723     5,798     4,047    
Fully tax-equivalent net interest income   274,241     136,096     362,653     233,809     153,239    
             
Total accretable yield   (21,407 )   (11,294 )   (27,793 )   (12,109 )   (9,219 )  
Core net interest income $ 252,834   $ 124,802   $ 334,860   $ 221,700   $ 144,020    
Average earning assets $ 13,564,056   $ 13,251,549   $ 8,908,418   $ 7,829,548   $ 7,653,177    
                 
Net interest margin   4.08 %   4.17 %   4.07 %   3.99 %   4.04 %  
Core net interest margin   3.76 %   3.82 %   3.76 %   3.79 %   3.79 %  
                             
Calculation of Core Loan Yield            
             
Loan interest income $ 293,603   $ 143,350   $ 352,351   $ 219,734   $ 142,277    
Total accretable yield   (21,407 )   (11,294 )   (27,793 )   (12,109 )   (9,219 )  
Core loan interest income $ 272,196   $ 132,056   $ 324,558   $ 207,625   $ 133,058    
Average loan balance $ 10,989,600   $ 10,819,324   $ 6,918,293   $ 5,967,036   $ 5,819,803    
                                 
Core loan yield   4.99 %   4.95 %   4.69 %   4.65 %   4.61 %  
                                 
(1) Efficiency ratio is noninterest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and noninterest revenues, excluding gains and losses from securities transactions and non-core items.  
             
 Page 12   

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