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BancFirst Corporation Reports Fourth Quarter Earnings

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OKLAHOMA CITY, Jan. 17, 2019 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS:BANF) reported net income of $32.7 million, or $0.98 diluted earnings per share, for the fourth quarter of 2018 compared to net income of $19.5 million, or $0.59 diluted earnings per share, for the fourth quarter of 2017. Net income for the fourth quarter of 2017 included a write down on deferred tax assets of $4.3 million due to the signing of the Tax Cuts and Jobs Act, which reduced the corporate tax rate beginning in 2018. Net income for the year ended December 31, 2018 was $125.8 million, or $3.76 diluted earnings per share, compared to $86.4 million, or $2.65 diluted earnings per share, for the year ended December 31, 2017. On January 11, 2018 the Company completed the acquisitions of two Oklahoma banking corporations. Consequently, 2018 included one-time acquisition related expenses of approximately $2.6 million, which reduced diluted earnings per share by approximately 6 cents. Net income for the year ended December 31, 2017 included the effects of favorable resolutions of three problem loans which resulted in principal recovery of $894,000 and unaccrued interest income of $2.7 million and also included a gain of $2.7 million, net of income tax and fees, from the sale of an investment by Council Oak Investment Corporation, a wholly-owned subsidiary of BancFirst.

The Company's net interest income for the fourth quarter of 2018 increased to $68.9 million compared to $58.7 million for the fourth quarter of 2017. The net interest margin for the quarter was 3.77% compared to 3.48% a year ago. The increase in margin was primarily due to the increase in the federal funds rate throughout 2017 and 2018 and the two acquisitions in the first quarter of 2018. The provision for loan losses for the fourth quarter of 2018 was $1.5 million compared to $3.3 million a year ago.  Net charge-offs decreased slightly to 0.04% of average loans for the fourth quarter of 2018 compared to 0.06% for the fourth quarter of 2017. Noninterest income for the quarter totaled $31.9 million, compared to $32.8 million last year. The decrease in noninterest income was due to the investment gain in 2017 described above, offset by growth in debit card usage fees, insurance commissions and cash management revenue in 2018. Noninterest expense for the quarter totaled $56.2 million compared to $51.3 million last year. The increase in noninterest expense was primarily due to salary increases in 2018 and the two acquisitions. The Company's effective tax rate for the fourth quarter of 2018 was 20.3% compared to 47.2% for the fourth quarter of 2017. The decrease in the effective tax rate compared to the fourth quarter of 2017 was due to the change in tax rates from the Tax Cuts and Jobs Act and a write down on deferred tax assets described above. 

At December 31, 2018, the Company's total assets were $7.6 billion, an increase of $321.1 million from December 31, 2017. The increase in total assets was primarily related to the acquisitions during the first quarter of 2018. Securities were $772.1 million, an increase of $307.8 million from December 31, 2017. The increase in securities was primarily related to a purchase of short term treasury securities towards the end of the year with approximate maturities of six months. Loans totaled $5.0 billion, an increase of $256.0 million over December 31, 2017, deposits totaled $6.6 billion, an increase of $190.5 million over the December 31, 2017 total, both increases were primarily related to the acquisitions. The Company's total stockholders' equity was $902.8 million, an increase of $127.2 million over December 31, 2017.

Asset quality remained strong during the fourth quarter of 2018. Nonperforming and restructured assets were 0.59% of total assets at December 31, 2018 compared to 0.61% at December 31, 2017. The allowance to total loans was 1.03% compared to 1.09% at year-end 2017. The allowance to nonperforming and restructured loans was 136.3% compared to 130.6% at year-end 2017.

On January 11, 2018, the Company completed the previously announced acquisitions of two Oklahoma banking corporations. First Wagoner Corporation and its subsidiary bank, First Bank & Trust Company, and First Chandler Corp. and its subsidiary bank, First Bank of Chandler, had combined total assets of approximately $378 million. The Company exchanged a combination of cash and stock for these transactions.

On August 31, 2018 the Company's wholly-owned subsidiary, BFTower, LLC, completed the purchase of Cotter Ranch Tower in Oklahoma City for $21.0 million. The Tower consists of an aggregate of 507,000 square feet, has 36 floors and is the second tallest building in Oklahoma City. The Company plans to move its headquarters to this location as soon as renovations are complete.

BancFirst Corporation CEO David Harlow commented, "Fueled by margin expansion as a result of rising interest rates, a reduced corporate income tax rate as a result of the Tax Cuts and Jobs Act and a stable Oklahoma economy, 2018 was a record earnings year for our company."

BancFirst Corporation (the Company) is an Oklahoma based financial services holding company.  The Company's principal subsidiary bank, BancFirst, is Oklahoma's largest state-chartered bank with 107 banking locations serving 58 communities across Oklahoma. More information can be found at www.bancfirst.bank.

The Company may make forward-looking statements within the meaning of Section 27A of the securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 with respect to earnings, credit quality, corporate objectives, interest rates and other financial and business matters.  Forward-looking statements include estimates and give management's current expectations or forecasts of future events.  The Company cautions readers that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, including economic conditions, the performance of financial markets and interest rates; legislative and regulatory actions and reforms; competition; as well as other factors, all of which change over time.  Actual results may differ materially from forward-looking statements.

BancFirst Corporation

Summary Financial Information

(Dollars in thousands, except per share and share data - Unaudited)




2018


2018


2018


2018


2017



4th Qtr 


3rd Qtr 


2nd Qtr 


1st Qtr 


4th Qtr 


 Condensed Income Statements: 











 Net interest income 

$               68,888


$               65,673


$               64,880


$               63,035


$               58,699


 Provision for loan losses 

1,516


747


1,225


314


3,323


 Non-interest income:











Trust revenue

3,023


3,281


3,396


3,129


3,073


Service charges on deposits

18,554


18,103


17,537


16,653


16,693


Securities transactions

10


(64)


115


(14)


4,412


Income from sales of loans

649


800


802


651


741


Insurance commissions

4,593


5,207


3,927


5,199


3,917


Cash management

3,338


3,383


3,381

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