BancFirst Corporation Reports Second Quarter Earnings

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OKLAHOMA CITY, July 18, 2019 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS:BANF) reported net income of $34.2 million, or $1.02 diluted earnings per share, for the second quarter of 2019 compared to net income of $30.6 million, or $0.91 diluted earnings per share, for the second quarter of 2018.   Net income for the six months ended June 30, 2019 was $66.0 million, or $1.98 per share, compared to $60.2 million, or $1.80 per share, for the first half of 2018.  On January 11, 2018 the Company completed the acquisitions of two Oklahoma banking corporations. Consequently, the first half of 2018 included one-time acquisition related expenses of approximately $2.2 million, which reduced diluted earnings per share by approximately 5 cents in the first quarter. 

The Company's net interest income for the second quarter of 2019 increased to $68.8 million compared to $64.9 million for the second quarter of 2018. The net interest margin for the quarter was 3.89% compared to 3.70% a year ago. The increase in margin was primarily due to the increase in the federal funds rate throughout 2018. The provision for loan losses for the second quarter of 2019 was $2.4 million compared to $1.2 million a year ago.  Net charge-offs for the second quarter of 2019 and 2018 were 0.01% of average loans.  Noninterest income for the quarter totaled $34.1 million, compared to $30.4 million last year. The increase in noninterest income was primarily due to growth in debit card usage fees, sweep fees and equity security gains of $821,000. Noninterest expense for the quarter totaled $56.6 million compared to $54.3 million last year. The increase in noninterest expense was primarily due to salary increases in 2019. The Company's effective tax rate was 22.0% compared to 23.2% for the second quarter of 2018. The decrease in the effective tax rate compared to the second quarter of 2018 was due to the increase in tax credits during the quarter.

At June 30, 2019, the Company's total assets were $7.6 billion, an increase of $67.8 million from December 31, 2018. Securities of $425.2 million were down $347.0 million from December 31, 2018. Loans totaled $5.1 billion, an increase of $121.2 million from December 31, 2018. Deposits totaled $6.6 billion, an increase of $8.1 million from the December 31, 2018 total. The Company's total stockholders' equity was $956.4 million, an increase of $53.6 million over December 31, 2018.

Asset quality remained strong during the second quarter of 2019.  Nonperforming and restructured assets represented 0.58% of total assets at June 30, 2019, virtually unchanged from the prior year. The allowance to total loans was 1.08% up slightly from 1.03% at year-end 2018. The allowance to nonperforming and restructured loans was 148.35% compared to 136.29% at year-end 2018.

BancFirst Corporation CEO David Harlow commented, "The Company reported a good quarter and first half of 2019. Improvement in net interest income, net interest margin, non-interest income and continued strong asset quality were the primary drivers."

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)




2019


2019


2018


2018


2018



2nd Qtr 


1st Qtr 


4th Qtr 


3rd Qtr 


2nd Qtr 


 Condensed Income Statements: 











 Net interest income 

$               68,792


$               66,903


$               66,888


$               65,673


$               64,880


 Provision for loan losses 

2,433


1,684


1,516


747


1,225


 Non-interest income:











Trust revenue

3,250


3,177


3,023


3,281


3,396


Service charges on deposits

19,114


17,663


18,554


18,103


17,537


Securities transactions

821


--


10


(64)


115


Income from sales of loans

868


698


649


800


802


Insurance commissions

4,420


5,265


4,593


5,207


3,927


Cash management

4,402


3,776


3,338


3,383


3,381


Other

1,202


1,422


1,684


2,091


1,279


Total noninterest income 

34,077


32,001


31,851


32,801


30,437













 Non-interest expense:











Salaries and employee benefits

36,124


36,171


35,530


35,051


34,776


Occupancy expense, net

2,953


2,627


3,307


3,386


3,396


Depreciation

3,015


2,985


2,965


2,733


2,429


Amortization of intangible assets

758


759


777


740


759


Data processing services

1,262


1,480


1,140


1,418


1,195


Net expense from other real estate owned

97


(484)


130


64


19


Marketing and business promotion

1,919


2,261


2,030


1,997


1,649


Deposit insurance

544


533


571


597


640


Other

9,936


9,874


9,716


9,823


9,393


Total noninterest expense 

56,608


56,206


56,166


55,809


54,256


 Income before income taxes 

43,828


41,014


41,057


41,918


39,836


 Income tax expense 

9,661


9,177


8,332


9,035


9,250


 Net income 

$               34,167


$               31,837


$               32,725


$               32,883


$               30,586


 Per Common Share Data: 











 Net income-basic 

$                   1.04


$                   0.98


$                   1.00


$                   1.01


$                   0.93


 Net income-diluted 

1.02


0.96


0.98


0.98


0.91


 Cash dividends declared

0.30


0.30


0.30


0.30


0.21


 Common shares outstanding 

32,639,588


32,617,788


32,603,926


32,749,690


32,731,215


 Average common shares outstanding -











   Basic

32,629,146


32,612,399


32,721,626


32,742,480


32,716,350


   Diluted

33,317,193


33,292,852


33,423,458


33,504,143


33,458,858


 Performance Ratios: 











 Return on average assets

1.78

%

1.69

%

1.70

%

1.71

%

1.62

%

 Return on average equity

14.54


14.08


14.48


14.86


14.41


 Net interest margin 

3.89


3.85


3.77


3.68


3.70


 Efficiency ratio 

55.03


56.83


56.88


56.67


56.92



 

BancFirst Corporation

Summary Financial Information

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




Six months ended

June 30,




2019


2018


 Condensed Income Statements: 






 Net interest income 


$             135,695


$             127,915


 Provision for loan losses 


4,117


1,539


 Non-interest income:






Trust revenue


6,427


6,525


Service charges on deposits


36,777


34,190


Securities transactions


821


101


Income from sales of loans


1,566


1,453


Insurance commissions


9,685


9,126


Cash management


8,178


6,402


Other


2,624


2,750


Total noninterest income 


66,078


60,547








 Non-interest expense:






Salaries and employee benefits


72,295


68,966


Occupancy expense, net


5,580


6,798


Depreciation


6,000


4,839


Amortization of intangible assets


1,517


1,492


Data processing services


2,742


2,398


Net expense from other real estate owned


(387)


45


Marketing and business promotion


4,180


4,001


Deposit insurance


1,077


1,259


Other


19,810


20,348


Total noninterest expense 


112,814


110,146


 Income before income taxes 


84,842


76,777


 Income tax expense 


18,838


16,571


 Net income 


$               66,004


$               60,206


 Per Common Share Data: 






 Net income-basic 


$                   2.02


$                   1.84


 Net income-diluted 


1.98


1.80


 Cash dividends declared


0.60


0.42


 Common shares outstanding 


32,639,588


32,731,215


 Average common shares outstanding -






   Basic


32,620,819


32,645,693


   Diluted


33,306,429


33,390,263


 Performance Ratios: 






 Return on average assets


1.74

%

1.61

%

 Return on average stockholders' equity


14.31


14.50


 Net interest margin 


3.87


3.68


 Efficiency ratio 


55.91


58.44



 

BancFirst Corporation

Summary Financial Information

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





2019


2019


2018


2018


2018



2nd Qtr


1st Qtr 


4th Qtr


3rd Qtr


2nd Qtr


 Balance Sheet Data:






















 Total assets

$  7,642,021


$  7,709,000


$  7,574,258


$  7,602,438


$  7,622,963


 Interest-bearing deposits with banks

1,518,998


1,291,447


1,195,824


1,607,157


1,579,577


 Debt securities

425,154


724,872


772,132


477,080


462,871


 Total loans

5,105,302


5,050,221


4,984,150


4,952,267


5,017,071


 Allowance for loan losses

(55,108)


(52,915)


(51,389)


(51,875)


(52,200)


 Deposits

6,613,613


6,706,386


6,605,495


6,643,131


6,692,174


 Stockholders' equity

956,380


927,927


902,789


884,801


862,012


 Book value per common share

29.30


28.45


27.69


27.02


26.34


 Tangible book value per common share (non-GAAP)(1)

26.40


25.52


24.74


24.06


23.35


 Balance Sheet Ratios:











 Average loans to deposits

76.07

%

75.34

%

74.24

%

74.76

%

74.38

%

 Average earning assets to total assets

92.43


92.42


92.48


93.04


93.11


 Average stockholders' equity to average assets

12.25


12.01


11.76


11.23


11.23


Asset Quality Data:











 Past due loans

$         2,663


$         2,170


$         1,916


$         4,073


$         2,916


 Nonaccrual loans

17,998


21,594


22,603


26,880


29,936


 Restructured loans

16,486


14,552


13,188


13,557


14,527


 Total nonperforming and restructured loans

37,147


38,316


37,707


44,510


47,379


 Other real estate owned and repossessed assets

7,004


6,433


6,873


7,072


3,847


 Total nonperforming and restructured assets

44,151


44,749


44,580


51,582


51,226


 Nonperforming and restructured loans to total loans

0.73

%

0.76

%

0.76

%

0.90

%

0.94

%

 Nonperforming and restructured assets to total assets

0.58


0.58


0.59


0.68


0.67


 Allowance to total loans

1.08


1.05


1.03


1.05


1.04


 Allowance to nonperforming and restructured loans

148.35


138.10


136.29


116.55


110.18


 Net charge-offs to average loans

0.01


0.00


0.04


0.02


0.01













Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(2):












Stockholders' equity

$     956,380


$     927,927


$     902,789


$       884,801


$       862,012


Less goodwill

79,749


79,749


79,749


79,733


79,733


Less intangible assets, net

14,936


15,701


16,470


17,257


18,012


Tangible stockholders' equity (non-GAAP)

$     861,695


$     832,477


$     806,570


$       787,811


$       764,267


Common shares outstanding

32,639,588


32,617,788


32,603,926


32,749,690


32,731,215


 Tangible book value per common share (non-GAAP)

$         26.40


$         25.52


$         24.74


$           24.06


$           23.35














(1)  Refer to the "Reconciliation of Tangible Book Value per Common Share (non-GAAP)" Table.

(2)  Tangible book value per common share is stockholders' equity less goodwill and intangible assets, net, divided by common shares outstanding. This amount is a non-GAAP financial measure but has been included as it is considered to be a critical metric with which to analyze and evaluate the financial condition and capital strength of the Company. This measure should not be considered a substitute for operating results determined in accordance with GAAP.


 

BancFirst Corporation

Consolidated Average Balance Sheets

And Interest Margin Analysis

Taxable Equivalent Basis

(Dollars in thousands - Unaudited)



Three Months Ended


Six Months Ended



June 30, 2019


June 30, 2019





Interest


Average




Interest


Average



Average


Income/


Yield/


Average


Income/


Yield/



Balance


Expense


Rate


Balance


Expense


Rate


ASSETS













Earning assets:













  Loans

$           5,082,637


$           71,142


5.61

%

$        5,048,164


$         140,016


5.59

%

  Securities – taxable

666,966


3,855


2.32


708,015


8,190


2.33


  Securities – tax exempt

20,215


150


2.97


20,850


309


2.99


  Interest bearing deposits with banks

1,339,375


8,135


2.44


1,306,396


15,885


2.45


     Total earning assets

7,109,193


83,282


4.70


7,083,425


164,400


4.68















Nonearning assets:













  Cash and due from banks

177,489






178,808






  Interest receivable and other assets

457,888






454,135






  Allowance for loan losses

(53,365)






(52,674)






     Total nonearning assets

582,012






580,269






     Total assets

$            7,691,205






$        7,663,694



















LIABILITIES AND STOCKHOLDERS' EQUITY

Interest bearing liabilities:













  Transaction deposits                      

$           738,742


$               659


0.36

%

$           746,205


$             1,321


0.36

%

  Savings deposits

2,637,248


10,424


1.59


2,631,540


20,725


1.59


  Time deposits

678,680


2,719


1.61


686,627


5,293


1.55


  Short-term borrowings

1,859


12


2.67


1,948


22


2.30


  Junior subordinated debentures

26,804


492


7.37


26,804


983


7.39


     Total interest bearing liabilities

4,083,333


14,306


1.41


4,093,124


28,344


1.40















Interest free funds:













  Noninterest bearing deposits

2,626,877






2,603,725






  Interest payable and other liabilities

38,459






37,010






  Stockholders' equity

942,536






929,835






     Total interest free  funds

3,607,872






3,570,570






     Total liabilities and stockholders' equity

$            7,691,205






$        7,663,694






Net interest income



$           68,976






$         136,056




Net interest spread





3.29

%





3.28

%

Effect of interest free funds





0.60

%





0.59

%

Net interest margin





3.89

%





3.87

%















 

SOURCE BancFirst

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