Sandy Spring Bancorp Reports Quarterly Earnings of $29.4 Million

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OLNEY, Md., Oct. 17, 2019 (GLOBE NEWSWIRE) -- Sandy Spring Bancorp, Inc., (Nasdaq-SASR), the parent company of Sandy Spring Bank, today reported net income for the third quarter of 2019 of $29.4 million ($0.82 per diluted share) compared to net income of $29.2 million ($0.82 per diluted share) for the third quarter of 2018 and net income of $28.3 million ($0.79 per diluted share) for the second quarter of 2019.

"In the third quarter we executed our business strategies with precision, focus and company-wide coordination. As a result, we delivered growth in every key category and solid financial metrics," said Daniel J. Schrider, President and Chief Executive Officer. "We continue to succeed in one of the most desirable markets in the country, and we are deepening our presence in Greater Washington through the acquisition of Revere Bank. We are in a tremendous position of strength as we prepare to close out the year and begin preparing the integration of Revere Bank into Sandy Spring Bank."

Third Quarter Highlights:  

  • Total loans at September 30, 2019 increased 3% compared to September 30, 2018.  During this period, the impact of the 6% growth in commercial loans was offset by the decline in the mortgage loan portfolio due to the impact of mortgage loan refinance activity driven by the current interest rate environment and the sale of the majority of new mortgage loan production. 
     
  • Total deposits grew 10% from the third quarter of 2018 and compared to the end of 2018. Deposit growth reduced the loan-to-deposit ratio from 111% at year-end 2018 to 102% at the end of the current quarter.  The year-to-date deposit growth included a 19% increase in noninterest-bearing deposits and a 45% reduction in wholesale deposits.
     
  • The provision for loan losses for the current quarter was $1.5 million compared to $1.9 million for the third quarter of 2018 and $1.6 million for the prior quarter of the current year.
     
  • The net interest margin was 3.51% for the third quarter of 2019, compared to 3.71% for the third quarter of 2018 and 3.54% for the second quarter of 2019.  The prior year's quarterly margin was positively impacted by an interest income recovery of $2.0 million.  Excluding the recovery, the net interest margin for the prior year quarter was 3.60%.
     
  • On September 24, 2019, the Company entered into a definitive agreement and plan of merger pursuant to which Revere Bank will merge with and into Sandy Spring Bank in a transaction valued at approximately $461 million.  Revere Bank, headquartered in Rockville, Maryland, has 11 banking offices and more than $2.6 billion in assets (as of June 30, 2019).
     
  • Quarterly non-interest income increased 24% as compared to the same period in the prior year driven by income from mortgage banking activities that grew 164%.  Growth was experienced in almost every other major category of non-interest income for the second consecutive quarter.
     
  • Non-interest expense for the quarter increased $2.5 million or 6% compared to the same quarter of the prior year.  Increases occurred in most major expense categories, notably compensation and benefits driven by incentive-based programs and an increase in marketing costs.  A large portion of the overall expense increases were offset by a decrease in FDIC insurance due to the receipt of an assessment credit during the current quarter.
     
  • The non-GAAP efficiency ratio continued to remain stable at 50.95% for the current quarter as compared to 49.27% for the third quarter of 2018 and 51.71% for the second quarter of 2019. Excluding the previously mentioned interest recovery in the prior year quarter, the non-GAAP efficiency ratio was 50.48%.

Review of Balance Sheet and Credit Quality

At September 30, 2019, total assets amounted to $8.4 billion compared to $8.0 billion at September 30, 2018 and $8.2 billion at December 31, 2018. Total loans at September 30, 2019 were $6.6 billion compared to $6.4 billion at September 30, 2018 and $6.6 billion at December 31, 2018.  Overall, the loan portfolio has remained relatively level from December 31, 2018 through September 30, 2019.  During this period, commercial loans grew 3% while mortgage loans have declined 2% due to the refinance activity and the strategic decision to sell the majority of new mortgage loan production.  During this period, total funded loan production was $618 million.  Commercial loans originated year-to-date had total unfunded commitments of $359 million as of September 30, 2019. 

Total deposits at September 30, 2019 were $6.5 billion compared to $5.9 billion at both September 30, 2018 and December 31, 2018.  The 10% increase from year-end 2018 was driven by increases in the majority of deposit categories.  The impact of the increase in deposits and rates during the first nine months of 2019 was partially offset by the benefit realized from an increase in noninterest-bearing deposits and a reduction in wholesale deposits. The increase in deposits enabled the reduction of higher cost borrowings, which declined $533 million from year-end through September 30, 2019, providing a positive impact on net interest income. 

Tangible common equity totaled $787 million at September 30, 2019, compared to $711 million at September 30, 2018 as the ratio of tangible common equity to tangible assets grew to 9.74% at September 30, 2019, as compared to 9.26% at September 30, 2018.  The Company had a total risk-based capital ratio of 12.70%, a common equity tier 1 risk-based capital ratio of 11.37%, a tier 1 risk-based capital ratio of 11.52% and a tier 1 leverage ratio of 9.96% at September 30, 2019.

The ratio of non-performing loans to total loans increased to 0.61% at September 30, 2019, compared to 0.52% at September 30, 2018.  Non-performing loans totaled $40.1 million at September 30, 2019, compared to $33.3 million at September 30, 2018, and $37.7 million at June 30, 2019. The modest growth in non-performing loans over the prior periods occurred primarily as a result of increases in segments of the loan portfolio secured by real estate.  Non-performing loans include accruing loans 90 days or more past due and restructured loans, but exclude purchased credit impaired loans acquired in the prior year's acquisition of WashingtonFirst Bankshares, Inc. ("WashingtonFirst").

Loan charge-offs, net of recoveries, for the third quarter of 2019 totaled $0.6 million.  Charge-offs for the third quarter of 2018 were not significant.  The allowance for loan losses represented 0.83% of outstanding loans and 137% of non-performing loans at September 30, 2019, compared to 0.79% of outstanding loans and 151% of non-performing loans at September 30, 2018. While non-performing loans increased from September 30, 2018 to the current quarter, the related reserves for those loans remained stable due to adequate collateral values. 

Income Statement Review

For the third quarter of 2019, net interest income decreased to $66.8 million compared to $67.6 million for the third quarter of 2018.  During this period, interest income increased 3% primarily due to loan growth and interest expense increased 21% related to deposit growth resulting in the decline in net interest income. The net interest margin for the current quarter was 3.51%, compared to the net interest margin for the third quarter of 2018 of 3.71%.  The prior year's quarterly margin was positively impacted by an interest income recovery of $2.0 million.  Excluding this recovery, the prior year's net interest margin was 3.60%.  The current quarter's margin benefited from the decrease in average borrowed funds in addition to an increase in average noninterest-bearing deposits compared to the prior year quarter.  Amortization of the fair value adjustments to both interest-earning assets and interest-bearing liabilities directly attributable to the WashingtonFirst acquisition had a 4 basis point positive effect on the net interest margin for the current period, compared to 8 basis points for the same period of the prior year.  The resulting adjusted net interest margin for the current quarter was 3.47% as compared to 3.52% for the prior year quarter.

The provision for loan losses was $1.5 million for the third quarter of 2019, compared to $1.9 million for the third quarter of 2018. The current quarter's provision reflects the impact of organic loan production and the need to establish a loan loss provision for previously acquired loans that had reached their maturity under their original lending arrangements and were renewed by Sandy Spring Bank.  

Non-interest income increased 24% to $18.6 million for the third quarter of 2019, compared to $15.0 million for the third quarter of 2018.  The increase in non-interest income was due primarily to the 164% increase in income from mortgage banking activities as the volume of residential mortgages sold increased.  Increases occurred in all non-interest income sources during the current quarter, with the exception of income from bank-owned life insurance, which remained level as compared to the third quarter of 2018.

Non-interest expense increased 6% to $44.9 million for the third quarter of 2019, compared to $42.4 million in the third quarter of 2018. The current year quarter included $0.4 million in merger expenses compared to $0.6 million for the prior year quarter.  Excluding merger expenses, non-interest expense increased 7% compared to the prior year, driven by higher compensation costs associated with incentive-based sales programs, marketing campaign expenses and an increase in occupancy and equipment costs.  A portion of these increases were offset by a decrease in FDIC insurance due to the industry deposit insurance fund reaching the stipulated benchmark levels.  The non-GAAP efficiency ratio was 50.95% for the third quarter of 2019, compared to 49.27% for the third quarter of 2018.  The non-GAAP efficiency ratio for the prior year quarter was 50.48% after excluding the previously mentioned interest income recovery.

Net interest income for the nine months ended September 30, 2019 increased 3% compared to the first nine months of 2018 due principally to loan growth. During the first nine months of 2019, the net interest margin was 3.55% compared to 3.62% for the prior year period. The first nine months of 2019 included $1.8 million in recovered interest income on acquired credit impaired loans compared to $2.0 million for the same period of the prior year.  Excluding the recovered interest income from both periods, the interest margin would have been 3.52% for the current year versus 3.59% for the prior year.  Amortization of the fair value adjustments attributable to the WashingtonFirst acquisition had a 5 basis point positive impact on the net interest margin for the nine months ended September 30, 2019, compared to 14 basis points for the prior year period. 

The provision for loan losses was $3.0 million for the first nine months of 2019, compared to $5.6 million for the first nine months of 2018.  The decrease in the provision for the current period compared to the prior year was primarily the result of the overall improvement in the qualitative credit metrics of the loan portfolio during the previous twelve months in addition to lower loan growth than experienced in the prior year.

Non-interest income was $52.1 million for the first nine months of 2019, compared to $47.0 million for the first nine months of 2018.  Excluding life insurance mortality proceeds of $0.6 million and $1.6 million from the first nine months of 2019 and 2018, respectively, non-interest income increased 13%. This increase was driven by income from mortgage banking activities, which increased 77% from the prior year-to-date, to $10.5 million for the nine months ended September 30, 2019, as a result of the rise in mortgage lending activity during 2019. Sales of originated mortgage loans rose 51% during the current period compared to the same period for 2018.  Increases also occurred in service charges, wealth management income, insurance commissions and other non-interest income.

Non-interest expense decreased 3% or $4.1 million to $133.0 million for the first nine months of 2019, compared to $137.1 million for the prior year period.  The prior year period included $11.8 million in merger expenses.  Excluding merger expenses, non-interest expense rose 6%, driven by increases in salaries and benefits, software costs, marketing costs and expenses from outside data services.  A portion of the increases in non-interest expense was offset by the decrease in FDIC insurance during the year.  The non-GAAP efficiency ratio was 51.36% for the first nine months of 2019 compared to 50.57% for the first nine months of 2018.

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Explanation of Non-GAAP Financial Measures

This news release contains financial information and performance measures determined by methods other than in accordance with generally accepted accounting principles in the United States ("GAAP"). The Company's management believes that the supplemental non-GAAP information provides a better comparison of period-to-period operating performance. Additionally, the Company believes this information is utilized by regulators and market analysts to evaluate a company's financial condition and, therefore, such information is useful to investors.  Non-GAAP measures used in this release consist of the following:

  • Tangible common equity and related measures are non-GAAP measures that exclude the impact of intangible assets.
  • The non-GAAP efficiency ratio is non-GAAP in that it excludes amortization of intangible assets, merger expenses and securities gains and includes tax-equivalent income.

These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Please refer to the non-GAAP Reconciliation table included with this release for details on the earnings impact of these items.

Conference Call

The Company's management will host a conference call to discuss its third quarter results today at 2:00 P.M. (ET).  A live Webcast of the conference call is available through the Investor Relations section of the Sandy Spring Website at www.sandyspringbank.com.  Participants may call 1-866-235-9910. A password is not necessary.  Visitors to the website are advised to log on 10 minutes ahead of the scheduled start of the call.  An internet-based replay will be available on the website until 9:00 am (ET) October 31, 2019.  A replay of the teleconference will be available through the same time period by calling 1-877-344-7529 under conference call number 10135193.

About Sandy Spring Bancorp, Inc.

Sandy Spring Bancorp, Inc., headquartered in Olney, Maryland, is the holding company for Sandy Spring Bank, the largest locally-headquartered community bank in the Greater Washington, D.C. region. With over 50 locations, the bank offers a broad range of commercial and retail banking, mortgage, private banking, and trust services throughout central Maryland, Northern Virginia, and Washington, D.C. Through its subsidiaries, Sandy Spring Insurance Corporation and West Financial Services, Inc., Sandy Spring Bank also offers a comprehensive menu of insurance and wealth management services. Visit www.sandyspringbank.com for more information.

For additional information or questions, please contact:
Daniel J. Schrider, President & Chief Executive Officer, or
Philip J. Mantua, E.V.P. & Chief Financial Officer
Sandy Spring Bancorp
17801 Georgia Avenue
Olney, Maryland 20832
1-800-399-5919 
Email:  DSchrider@sandyspringbank.com
            PMantua@sandyspringbank.com
Website: www.sandyspringbank.com

Media Contact:
Jen Schell
301-570-8331
jschell@sandyspringbank.com

Forward-Looking Statements

Sandy Spring Bancorp makes forward-looking statements in this news release and in the conference call regarding this news release.  These forward-looking statements may include: statements of goals, intentions, earnings expectations, and other expectations; estimates of risks and of future costs and benefits; assessments of probable loan losses; assessments of market risk; and statements of the ability to achieve financial and other goals.

Forward-looking statements are typically identified by words such as "believe," "expect," "anticipate," "intend," "outlook," "estimate," "forecast," "project" and other similar words and expressions.  Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time.  Forward-looking statements speak only as of the date they are made.  Sandy Spring Bancorp does not assume any duty and does not undertake to update its forward-looking statements.  Because forward-looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those that Sandy Spring Bancorp anticipated in its forward-looking statements and future results could differ materially from historical performance.

Sandy Spring Bancorp's forward-looking statements are subject to the following principal risks and uncertainties: general economic conditions and trends, either nationally or locally; conditions in the securities markets; changes in interest rates; changes in deposit flows, and in the demand for deposit, loan, and investment products and other financial services; changes in real estate values; changes in the quality or composition of the Company's loan or investment portfolios; changes in competitive pressures among financial institutions or from non-financial institutions; the Company's ability to retain key members of management; changes in legislation, regulations, and policies; risks, uncertainties and other factors relating to the acquisition of Revere Bank by Sandy Spring Bancorp, including the ability to obtain regulatory and shareholder approvals and meet other closing conditions to the transaction, and delay in closing the merger; the possibility that any of the anticipated benefits of acquisitions will not be realized or will not be realized within the expected time period; and a variety of other matters which, by their nature, are subject to significant uncertainties.  Sandy Spring Bancorp provides greater detail regarding some of these factors in its Form 10-K for the year ended December 31, 2018, including in the Risk Factors section of that report, and in its other SEC reports.  Sandy Spring Bancorp's forward-looking statements may also be subject to other risks and uncertainties, including those that it may discuss elsewhere in this news release or in its filings with the SEC, accessible on the SEC's Web site at www.sec.gov.

               
Sandy Spring Bancorp, Inc. and Subsidiaries              
FINANCIAL HIGHLIGHTS - UNAUDITED              
               
  Three Months Ended    Nine Months Ended   
  September 30, %  September 30, % 
(Dollars in thousands, except per share data)  2019  2018 Change   2019  2018 Change 
Results of Operations:              
Net interest income $ 66,790 $67,591 (1)% $ 199,725 $194,300 3 %
Provision for loan losses  1,524  1,890 (19)   3,029  5,620 (46) 
Non-interest income  18,573  15,033 24    52,098  47,019 11  
Non-interest expense  44,925  42,393 6    133,004  137,116 (3) 
Income before income taxes  38,914  38,341 1    115,790  98,583 17  
Net income  29,383  29,234 1    87,976  75,298 17  
               
Pre-tax pre-provision pre-merger income (5) $ 40,802 $40,811 -   $ 119,183 $115,969 3  
               
Return on average assets  1.39% 1.45%    1.42% 1.27%  
Return on average common equity  10.38% 11.26%    10.71% 9.89%  
Net interest margin  3.51% 3.71%    3.55% 3.62%  
Efficiency ratio - GAAP basis (1)  52.63% 51.31%    52.82% 56.82%  
Efficiency ratio - Non-GAAP basis (1)  50.95% 49.27%    51.36% 50.57%  
               
Per share data:              
Basic net income $ 0.82 $0.82 - % $ 2.46 $2.11 17 %
Diluted net income $ 0.82 $0.82 -   $ 2.45 $2.11 16  
Average fully diluted shares  35,900,102  35,744,085 -    35,879,584  35,721,702 -  
Dividends declared per share $ 0.30 $0.28 7   $ 0.88 $0.82 7  
Book value per share  32.00  29.35 9    32.00  29.35 9  
Tangible book value per share (5)  22.10  20.03 10    22.10  20.03 10  
Outstanding shares  35,625,822  35,521,541 -    35,625,822  35,521,541 -  
               
Financial Condition at period-end:              
Investment securities $ 946,210 $992,797 (5)% $ 946,210 $992,797 (5)%
Loans  6,596,548  6,388,959 3    6,596,548  6,388,959 3  
Interest-earning assets  7,742,138  7,428,534 4    7,742,138  7,428,534 4  
Assets  8,437,538  8,034,565 5    8,437,538  8,034,565 5  
Deposits  6,493,899  5,898,394 10    6,493,899  5,898,394 10  
Interest-bearing liabilities  5,093,265  5,042,431 1    5,093,265  5,042,431 1  
Stockholders' equity  1,140,041  1,042,716 9    1,140,041  1,042,716 9  
               
Capital ratios:              
Tier 1 leverage (4)  9.96% 9.46%    9.96% 9.46%  
Tier 1 capital to risk-weighted assets (4)  11.52% 11.18%    11.52% 11.18%  
Total regulatory capital to risk-weighted assets (4)  12.70% 12.38%    12.70% 12.38%  
Common equity tier 1 capital to risk-weighted assets (4)  11.37% 11.02%    11.37% 11.02%  
Tangible common equity to tangible assets (2)  9.74% 9.26%    9.74% 9.26%  
Average equity to average assets  13.42% 12.90%    13.22% 12.85%  
               
Credit quality ratios:              
Allowance for loan losses to loans  0.83% 0.79%    0.83% 0.79%  
Non-performing loans to total loans  0.61% 0.52%    0.61% 0.52%  
Non-performing assets to total assets  0.49% 0.44%    0.49% 0.44%  
Allowance for loan losses to non-performing loans  137.05% 151.35%    137.05% 151.35%  
Annualized net charge-offs to average loans (3)  0.03% 0.00%    0.03% 0.01%  
               
(1) The efficiency ratio - GAAP basis is non-interest expense divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income.   
The traditional efficiency ratio - Non-GAAP basis excludes intangible asset amortization and merger expenses from non-interest expense;     
securities gains from non-interest income and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.   
(2) The tangible common equity to tangible assets ratio is a non-GAAP ratio that divides assets excluding intangible assets into stockholders' equity after deducting intangible assets   
and other comprehensive gains (losses). See the Reconciliation Table included with these Financial Highlights.         
(3) Calculation utilizes average loans, excluding residential mortgage loans held-for-sale.            
(4) Estimated ratio at September 30, 2019.              
(5) Represents a Non-GAAP measure.              
               


          
Sandy Spring Bancorp, Inc. and Subsidiaries         
RECONCILIATION TABLE - UNAUDITED         
          
  Three Months Ended Nine Months Ended 
  September 30, September 30, 
(Dollars in thousands)  2019   2018   2019   2018  
Pre-tax pre-provision pre-merger income:         
Net income $ 29,383  $29,234  $ 87,976  $75,298  
Plus non-GAAP adjustments:         
Merger expenses  364   580   364   11,766  
Income taxes  9,531   9,107   27,814   23,285  
Provision for loan losses  1,524   1,890   3,029   5,620  
Pre-tax pre-provision pre-merger income $ 40,802  $40,811  $ 119,183  $115,969  
          
Efficiency ratio - GAAP basis:         
Non-interest expense $ 44,925  $42,393  $ 133,004  $137,116  
          
Net interest income plus non-interest income $ 85,363  $82,624  $ 251,823  $241,319  
          
Efficiency ratio - GAAP basis  52.63%  51.31%  52.82%  56.82% 
          
          
Efficiency ratio - Non-GAAP basis:         
Non-interest expense $ 44,925  $42,393  $ 133,004  $137,116  
Less non-GAAP adjustments:         
Amortization of intangible assets  491   540   1,465   1,622  
Merger expenses  364   580   364   11,766  
Non-interest expense - as adjusted $ 44,070  $41,273  $ 131,175  $123,728  
          
Net interest income plus non-interest income $ 85,363  $82,624  $ 251,823  $241,319  
Plus non-GAAP adjustment:         
Tax-equivalent income  1,147   1,221   3,597   3,483  
Less non-GAAP adjustment:         
Securities gains  15   82   20   145  
Net interest income plus non-interest income - as adjusted $ 86,495  $83,763  $ 255,400  $244,657  
          
Efficiency ratio - Non-GAAP basis  50.95%  49.27%  51.36%  50.57% 
          
Tangible common equity ratio:         
Total stockholders' equity $ 1,140,041  $1,042,716  $ 1,140,041  $1,042,716  
Accumulated other comprehensive loss  2,708   24,420   2,708   24,420  
Goodwill  (347,149)  (345,422)  (347,149)  (345,422) 
Other intangible assets, net  (8,322)  (10,327)  (8,322)  (10,327) 
Tangible common equity $ 787,278  $711,387  $ 787,278  $711,387  
          
Total assets $ 8,437,538  $8,034,565  $ 8,437,538  $8,034,565  
Goodwill  (347,149)  (345,422)  (347,149)  (345,422) 
Other intangible assets, net  (8,322)  (10,327)  (8,322)  (10,327) 
Tangible assets $ 8,082,067  $7,678,816  $ 8,082,067  $7,678,816  
          
Tangible common equity ratio  9.74%  9.26%  9.74%  9.26% 
          
Outstanding common shares  35,625,822   35,521,541   35,625,822   35,521,541  
Tangible book value per common share $ 22.10  $20.03  $ 22.10  $20.03  
          


       
Sandy Spring Bancorp, Inc. and Subsidiaries      
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED      
       
  September 30,December 31, September 30,
(Dollars in thousands)  2019   2018   2018 
Assets      
Cash and due from banks $ 89,377  $67,014  $63,380 
Federal funds sold  253   609   2,055 
Interest-bearing deposits with banks  120,306   33,858   13,142 
Cash and cash equivalents  209,936   101,481   78,577 
Residential mortgage loans held for sale (at fair value)  78,821   22,773   31,581 
Investments available-for-sale (at fair value)  894,272   937,335   926,723 
Other equity securities  51,938   73,389   66,074 
Total loans  6,596,548   6,571,634   6,388,959 
Less: allowance for loan losses  (54,992)  (53,486)  (50,409)
Net loans  6,541,556   6,518,148   6,338,550 
Premises and equipment, net  59,487   61,942   62,098 
Other real estate owned  1,482   1,584   2,118 
Accrued interest receivable  23,438   24,609   24,058 
Goodwill  347,149   347,149   345,422 
Other intangible assets, net  8,322   9,788   10,327 
Other assets  221,137   145,074   149,037 
Total assets $ 8,437,538  $8,243,272  $8,034,565 
       
Liabilities      
Noninterest-bearing deposits $ 2,081,435  $1,750,319  $1,902,537 
Interest-bearing deposits  4,412,464   4,164,561   3,995,857 
Total deposits  6,493,899   5,914,880   5,898,394 
Securities sold under retail repurchase agreements and federal funds purchased  126,008   327,429   142,669 
Advances from FHLB  517,477   848,611   866,445 
Subordinated debentures  37,316   37,425   37,460 
Accrued interest payable and other liabilities  122,797   47,024   46,881 
Total liabilities  7,297,497   7,175,369   6,991,849 
       
Stockholders' Equity      
Common stock -- par value $1.00; shares authorized 100,000,000; shares issued and outstanding 35,625,822,      
35,530,734 and 35,521,541 at September 30, 2019, December 31, 2018 and September 30, 2018, respectively  35,626   35,531   35,522 
Additional paid in capital  609,103   606,573   605,623 
Retained earnings  498,020   441,553   425,991 
Accumulated other comprehensive loss  (2,708)  (15,754)  (24,420)
Total stockholders' equity  1,140,041   1,067,903   1,042,716 
Total liabilities and stockholders' equity $ 8,437,538  $8,243,272  $8,034,565 
       



         
Sandy Spring Bancorp, Inc. and Subsidiaries        
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED      
         
  Three Months Ended Nine Months Ended
 September 30,September 30,
(Dollars in thousands, except per share data)  2019   2018  2019  2018
Interest Income:        
Interest and fees on loans $ 79,167  $76,786 $ 239,028 $215,050
Interest on loans held for sale  572   336  1,145  983
Interest on deposits with banks  783   211  1,405  1,082
Interest and dividends on investment securities:        
Taxable  5,221   5,112  16,302  15,297
Exempt from federal income taxes  1,337   1,921  4,591  6,035
Interest on federal funds sold  2   8  8  28
Total interest income  87,082   84,374  262,479  238,475
Interest Expense:        
Interest on deposits  16,332   10,773  46,958  26,583
Interest on retail repurchase agreements and federal funds purchased  257   383  945  599
Interest on advances from FHLB  3,222   5,141  13,389  15,557
Interest on subordinated debt  481   486  1,462  1,436
Total interest expense  20,292   16,783  62,754  44,175
Net interest income  66,790   67,591  199,725  194,300
Provision for loan losses  1,524   1,890  3,029  5,620
Net interest income after provision for loan losses  65,266   65,701  196,696  188,680
Non-interest Income:        
Investment securities gains  15   82  20  145
Service charges on deposit accounts  2,516   2,316  7,265  6,865
Mortgage banking activities  4,408   1,672  10,541  5,943
Wealth management income  5,493   5,344  16,268  15,792
Insurance agency commissions  2,116   2,016  5,281  5,020
Income from bank owned life insurance  662   663  2,505  3,664
Bank card fees  1,462   1,436  4,181  4,199
Other income  1,901   1,504  6,037  5,391
Total non-interest income  18,573   15,033  52,098  47,019
Non-interest Expense:        
Salaries and employee benefits  26,234   24,488  77,699  73,064
Occupancy expense of premises  4,816   4,355  14,807  13,939
Equipment expenses  2,641   2,441  7,929  6,909
Marketing  1,541   770  3,371  2,863
Outside data services  1,973   1,736  5,713  4,840
FDIC insurance  (83)  1,257  2,137  3,840
Amortization of intangible assets  491   540  1,465  1,622
Merger expenses  364   580  364  11,766
Professional fees and services  1,546   1,351  4,425  4,090
Other expenses  5,402   4,875  15,094  14,183
Total non-interest expense  44,925   42,393  133,004  137,116
Income before income taxes  38,914   38,341  115,790  98,583
Income tax expense  9,531   9,107  27,814  23,285
Net income $ 29,383  $29,234 $ 87,976 $75,298
         
Net Income Per Share Amounts:        
Basic net income per share $ 0.82  $0.82 $ 2.46 $2.11
Diluted net income per share $ 0.82  $0.82 $ 2.45 $2.11
Dividends declared per share $ 0.30  $0.28 $ 0.88 $0.82
         



                
Sandy Spring Bancorp, Inc. and Subsidiaries               
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED           
                
   2019     2018  
(Dollars in thousands, except per share data) Q3 Q2 Q1 Q4 Q3 Q2 Q1 
Profitability for the Quarter:               
Tax-equivalent interest income $ 88,229  $88,423  $89,424  $86,839  $85,595  $79,774  $76,589  
Interest expense  20,292   21,029   21,433   19,462   16,783   14,779   12,613  
Tax-equivalent net interest income  67,937   67,394   67,991   67,377   68,812   64,995   63,976  
Tax-equivalent adjustment  1,147   1,209   1,241   1,232   1,221   1,177   1,085  
Provision (credit) for loan losses  1,524   1,633   (128)  3,403   1,890   1,733   1,997  
Non-interest income  18,573   16,556   16,969   14,030   15,033   14,868   17,118  
Non-interest expense  44,925   43,887   44,192   42,667   42,393   45,082   49,641  
Income before income taxes  38,914   37,221   39,655   34,105   38,341   31,871   28,371  
Income tax expense  9,531   8,945   9,338   8,539   9,107   7,472   6,706  
Net income $ 29,383  $28,276  $30,317  $25,566  $29,234  $24,399  $21,665  
Financial Performance:               
Pre-tax pre-provision pre-merger income $ 40,802  $38,854  $39,527  $37,508  $40,811  $35,832  $39,326  
Return on average assets  1.39%  1.37%  1.49%  1.25%  1.45%  1.23%  1.12% 
Return on average common equity  10.38%  10.32%  11.46%  9.70%  11.26%  9.66%  8.70% 
Net interest margin  3.51%  3.54%  3.60%  3.57%  3.71%  3.56%  3.58% 
Efficiency ratio - GAAP basis (1)  52.63%  53.04%  52.79%  53.22%  51.31%  57.29%  62.04% 
Efficiency ratio - Non-GAAP basis (1)  50.95%  51.71%  51.44%  51.78%  49.27%  52.98%  49.54% 
Per Share Data:               
Basic net income per share $ 0.82  $0.79  $0.85  $0.72  $0.82  $0.68  $0.61  
Diluted net income per share $ 0.82  $0.79  $0.85  $0.72  $0.82  $0.68  $0.61  
Average fully diluted shares  35,900,102   35,890,437   35,806,459   35,747,478   35,744,085   35,743,927   35,683,542  
Dividends declared per common share $ 0.30  $0.30  $0.28  $0.28  $0.28  $0.28  $0.26  
Non-interest Income:               
Securities gains $ 15  $5  $-  $45  $82  $-  $63  
Service charges on deposit accounts  2,516   2,442   2,307   2,459   2,316   2,290   2,259  
Mortgage banking activities  4,408   3,270   2,863   1,130   1,672   2,064   2,207  
Wealth management income  5,493   5,539   5,236   5,492   5,344   5,387   5,061  
Insurance agency commissions  2,116   1,265   1,900   1,138   2,016   1,180   1,824  
Income from bank owned life insurance  662   654   1,189   663   663   670   2,331  
Bank card fees  1,462   1,467   1,252   1,368   1,436   1,393   1,370  
Other income  1,901   1,914   2,222   1,735   1,504   1,884   2,003  
Total Non-interest Income $ 18,573  $16,556  $16,969  $14,030  $15,033  $14,868  $17,118  
Non-interest Expense:               
Salaries and employee benefits $ 26,234  $25,489  $25,976  $23,934  $24,488  $24,664  $23,912  
Occupancy expense of premises  4,816   4,760   5,231   4,413   4,355   4,642   4,942  
Equipment expenses  2,641   2,712   2,576   2,426   2,441   2,243   2,225  
Marketing  1,541   887   943   1,061   770   945   1,148  
Outside data services  1,973   1,962   1,778   1,763   1,736   1,707   1,397  
FDIC insurance  (83)  1,084   1,136   1,255   1,257   1,390   1,193  
Amortization of intangible assets  491   483   491   540   540   541   541  
Merger expenses  364   -   -   -   580   2,228   8,958  
Professional fees and services  1,546   1,634   1,245   1,966   1,351   1,699   1,040  
Other expenses  5,402   4,876   4,816   5,309   4,875   5,023   4,285  
Total Non-interest Expense $ 44,925  $43,887  $44,192  $42,667  $42,393  $45,082  $49,641  
                
(1) The efficiency ratio - GAAP basis is non-interest expense divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income. 
The traditional efficiency ratio - Non-GAAP basis excludes intangible asset amortization and merger expenses from non-interest expense; 
securities gains from non-interest income; and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights. 
                



                
Sandy Spring Bancorp, Inc. and Subsidiaries               
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED           
                
   2019   2018  
(Dollars in thousands) Q3 Q2 Q1 Q4 Q3 Q2 Q1 
Balance Sheets at Quarter End:               
Residential mortgage loans $ 1,199,275  $1,241,081  $1,249,968  $1,228,247  $1,181,427  $1,106,674  $992,287  
Residential construction loans  150,692   171,106   176,388   186,785   188,779   197,372   215,445  
Commercial AD&C loans  678,906   658,709   688,939   681,201   631,589   609,266   564,871  
Commercial investor real estate loans  2,036,021   1,994,027   1,962,879   1,958,395   1,924,397   1,923,827   1,928,439  
Commercial owner occupied real estate loans  1,278,505   1,224,986   1,216,713   1,202,903   1,201,673   1,184,421   1,174,739  
Commercial business loans  772,619   772,158   769,660   796,264   738,083   702,939   652,797  
Consumer loans  480,530   489,176   505,443   517,839   523,011   525,574   532,973  
Total loans  6,596,548   6,551,243   6,569,990   6,571,634   6,388,959   6,250,073   6,061,551  
Allowance for loan losses  (54,992)  (54,024)  (53,089)  (53,486)  (50,409)  (48,493)  (46,931) 
Loans held for sale  78,821   50,511   24,998   22,773   31,581   40,000   28,486  
Investment securities  946,210   955,715   987,299   1,010,724   992,797   1,017,274   1,040,339  
Interest-earning assets  7,742,138   7,713,364   7,648,654   7,639,598   7,428,534   7,532,664   7,285,731  
Total assets  8,437,538   8,398,519   8,327,900   8,243,272   8,034,565   8,152,600   7,894,918  
Noninterest-bearing demand deposits  2,081,435   2,023,614   1,813,708   1,750,319   1,902,537   1,910,690   1,767,523  
Total deposits  6,493,899   6,389,749   6,224,523   5,914,880   5,898,394   5,837,826   5,627,206  
Customer repurchase agreements  126,008   150,604   122,626   137,429   142,669   139,647   149,323  
Total interest-bearing liabilities  5,093,265   5,136,860   5,297,108   5,378,026   5,042,431   5,168,055   5,057,645  
Total stockholders' equity  1,140,041   1,119,445   1,095,848   1,067,903   1,042,716   1,026,349   1,014,608  
Quarterly Average Balance Sheets:               
Residential mortgage loans $ 1,215,132  $1,244,086  $1,230,319  $1,188,135  $1,122,946  $1,034,062  $1,117,478  
Residential construction loans  162,196   174,095   189,720   202,710   215,578   223,171   193,327  
Commercial AD&C loans  651,905   686,282   676,205   647,115   632,354   576,076   582,876  
Commercial investor real estate loans  1,982,979   1,960,919   1,964,699   1,936,936   1,905,427   1,924,759   1,988,340  
Commercial owner occupied real estate loans  1,258,000   1,215,632   1,207,799   1,196,506   1,190,865   1,184,409   940,065  
Commercial business loans  786,150   756,594   780,318   751,754   700,791   666,280   657,372  
Consumer loans  486,865   505,235   515,644   522,453   524,605   531,965   538,198  
Total loans  6,543,227   6,542,843   6,564,704   6,445,609   6,292,566   6,140,722   6,017,656  
Loans held for sale  61,870   37,121   17,846   21,923   29,939   25,403   35,768  
Investment securities  941,048   964,863   1,010,940   986,146   996,365   1,028,306   1,062,325  
Interest-earning assets  7,690,629   7,619,240   7,627,187   7,495,338   7,372,536   7,311,272   7,212,878  
Total assets  8,370,789   8,294,883   8,258,116   8,104,916   7,986,525   7,926,735   7,841,611  
Noninterest-bearing demand deposits  1,909,884   1,796,802   1,682,720   1,766,672   1,822,931   1,796,644   1,651,258  
Total deposits  6,405,762   6,247,409   5,952,942   5,822,580   5,783,992   5,657,420   5,489,715  
Customer repurchase agreements  138,736   141,865   129,059   146,637   139,809   148,539   136,694  
Total interest-bearing liabilities  5,202,876   5,269,209   5,403,946   5,230,254   5,076,717   5,058,016   5,116,904  
Total stockholders' equity  1,123,185   1,099,078   1,073,291   1,045,378   1,030,167   1,013,081   1,010,106  
Financial Measures:               
Average equity to average assets  13.42%  13.25%  13.00%  12.90%  12.90%  12.78%  12.88% 
Investment securities to earning assets  12.22%  12.39%  12.91%  13.23%  13.36%  13.50%  14.28% 
Loans to earning assets  85.20%  84.93%  85.90%  86.02%  86.01%  82.97%  83.20% 
Loans to assets  78.18%  78.00%  78.89%  79.72%  79.52%  76.66%  76.78% 
Loans to deposits  101.58%  102.53%  105.55%  111.10%  108.32%  107.06%  107.72% 
Capital Measures:               
Tier 1 leverage (1)  9.96%  9.80%  9.61%  9.50%  9.46%  9.27%  9.21% 
Tier 1 capital to risk-weighted assets (1)  11.52%  11.59%  11.35%  11.06%  11.18%  11.01%  11.08% 
Total regulatory capital to risk-weighted assets (1)  12.70%  12.79%  12.54%  12.26%  12.38%  12.19%  12.27% 
Common equity tier 1 capital to risk-weighted assets (1)  11.37%  11.43%  11.19%  10.90%  11.02%  10.85%  10.92% 
Book value per share $ 32.00  $31.43  $30.82  $30.06  $29.35  $28.90  $28.61  
Outstanding shares  35,625,822   35,614,953   35,557,110   35,530,734   35,521,541   35,511,943   35,463,269  
(1) Estimated ratio at September 30, 2019               
                



               
Sandy Spring Bancorp, Inc. and Subsidiaries              
LOAN PORTFOLIO QUALITY DETAIL - UNAUDITED            
               
   2019   2018 
(Dollars in thousands) September 30, June 30, March 31, December 31, September 30, June 30, March 31,
Non-Performing Assets:              
Loans 90 days past due:              
Commercial business $ 17  $-  $-  $49  $150  $6  $- 
Commercial real estate:              
Commercial AD&C  -   -   -   -   1,261   -   - 
Commercial investor real estate  1,201   1,248   -   -   -   -   - 
Commercial owner occupied real estate  -   -   90   -   13   112   - 
Consumer  -   -   -   219   563   -   126 
Residential real estate:              
Residential mortgage  -   -   221   221   -   -   - 
Residential construction  -   -   -   -   -   -   - 
Total loans 90 days past due  1,218   1,248   311   489   1,987   118   126 
Non-accrual loans:              
Commercial business  6,393   7,083   8,013   7,086   6,352   6,883   6,634 
Commercial real estate:              
Commercial AD&C  829   1,990   3,306   3,306   136   136   136 
Commercial investor real estate  8,454   6,409   6,071   5,355   5,861   5,878   5,813 
Commercial owner occupied real estate  3,810   3,766   5,992   4,234   3,352   3,440   3,524 
Consumer  4,561   4,439   4,081   4,107   4,098   4,298   3,244 
Residential real estate:              
Residential mortgage  12,574   10,625   9,704   9,336   9,134   6,251   7,063 
Residential construction  -   -   156   159   163   168   174 
Total non-accrual loans  36,621   34,312   37,323   33,583   29,096   27,054   26,588 
Total restructured loans - accruing  2,287   2,133   2,479   1,942   2,224   1,663   2,678 
Total non-performing loans  40,126   37,693   40,113   36,014   33,307   28,835   29,392 
Other assets and real estate owned (OREO)  1,482   1,486   1,410   1,584   2,118   2,361   2,761 
Total non-performing assets $ 41,608  $39,179  $41,523  $37,598  $35,425  $31,196  $32,153 
               
  For the Quarter Ended,
  September 30, June 30, March 31, December 31, September 30, June 30, March 31,
(Dollars in thousands)  2019   2019   2019   2018   2018   2018   2018 
Analysis of Non-accrual Loan Activity:              
Balance at beginning of period $ 34,312  $37,323  $33,583  $29,096  $27,054  $26,588  $26,336 
Non-accrual balances transferred to OREO  -   (195)  -   -   -   -   (289)
Non-accrual balances charged-off  (705)  (604)  (227)  (360)  (91)  (144)  (411)
Net payments or draws  (2,903)  (5,517)  (1,786)  (1,126)  (1,777)  (1,635)  (357)
Loans placed on non-accrual  6,015   3,396   6,202   5,973   4,193   2,245   1,309 
Non-accrual loans brought current  (98)  (91)  (449)  -   (283)  -   - 
Balance at end of period $ 36,621  $34,312  $37,323  $33,583  $29,096  $27,054  $26,588 
               
Analysis of Allowance for Loan Losses:              
Balance at beginning of period $ 54,024  $53,089  $53,486  $50,409  $48,493  $46,931  $45,257 
Provision (credit) for loan losses  1,524   1,633   (128)  3,403   1,890   1,733   1,997 
Less loans charged-off, net of recoveries:              
Commercial business  389   735   7   (9)  (49)  (73)  322 
Commercial real estate:              
Commercial AD&C  (224)  (4)  -   -   -   -   (62)
Commercial investor real estate  (3)  (3)  (7)  109   (49)  (8)  (8)
Commercial owner occupied real estate  -   -   -   -   -   -   - 
Consumer  187   (18)  182   45   85   244   99 
Residential real estate:              
Residential mortgage  209   (10)  89   183   (11)  13   (22)
Residential construction  (2)  (2)  (2)  (2)  (2)  (5)  (6)
Net charge-offs  556   698   269   326   (26)  171   323 
Balance at end of period $ 54,992  $54,024  $53,089  $53,486  $50,409  $48,493  $46,931 
               
Asset Quality Ratios:              
Non-performing loans to total loans  0.61%  0.58%  0.61%  0.55%  0.52%  0.46%  0.48%
Non-performing assets to total assets  0.49%  0.47%  0.50%  0.46%  0.44%  0.38%  0.41%
Allowance for loan losses to loans  0.83%  0.82%  0.81%  0.81%  0.79%  0.78%  0.77%
Allowance for loan losses to non-performing loans  137.05%  143.33%  132.35%  148.51%  151.35%  168.17%  159.67%
Annualized net charge-offs to average loans  0.03%  0.04%  0.02%  0.02%  0.00%  0.01%  0.02%
               



             
Sandy Spring Bancorp, Inc. and Subsidiaries            
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED      
               
  Three Months Ended September 30, 
  2019
  2018
 
        Annualized      Annualized 
  Average (1) Average  Average (1) Average 
(Dollars in thousands and tax-equivalent) Balances Interest Yield/Rate  Balances Interest Yield/Rate 
Assets              
Residential mortgage loans $ 1,215,132  $ 11,649  3.83%$1,122,946  $10,485  3.73%
Residential construction loans  162,196   1,746  4.27   215,578   2,160  3.98 
Total mortgage loans  1,377,328   13,395  3.89   1,338,524   12,645  3.77 
Commercial AD&C loans  651,905   9,705  5.91   632,354   9,185  5.76 
Commercial investor real estate loans  1,982,979   24,342  4.87   1,905,427   25,735  5.36 
Commercial owner occupied real estate loans  1,258,000   15,749  4.97   1,190,865   14,484  4.83 
Commercial business loans  786,150   10,350  5.22   700,791   9,196  5.21 
Total commercial loans  4,679,034   60,146  5.10   4,429,437   58,600  5.25 
Consumer loans  486,865   6,132  5.00   524,605   6,011  4.59 
Total loans (2)  6,543,227   79,673  4.84   6,292,566   77,256  4.88 
Loans held for sale  61,870   572  3.70   29,939   336  4.49 
Taxable securities  744,461   5,504  2.95   720,317   5,342  2.97 
Tax-exempt securities (3)  196,587   1,695  3.45   276,048   2,442  3.54 
Total investment securities (4)  941,048   7,199  3.06   996,365   7,784  3.12 
Interest-bearing deposits with banks  143,865   783  2.16   51,683   211  1.62 
Federal funds sold  619   2  1.42   1,983   8  1.58 
Total interest-earning assets  7,690,629   88,229  4.56   7,372,536   85,595  4.61 
               
Less: allowance for loan losses  (54,147)       (49,194)     
Cash and due from banks  64,154        64,653      
Premises and equipment, net  60,537        62,452      
Other assets  609,616        536,078      
Total assets $ 8,370,789       $7,986,525      
               
Liabilities and Stockholders' Equity              
Interest-bearing demand deposits $ 749,720   545  0.29%$703,905   231  0.13%
Regular savings deposits  326,913   110  0.13   347,299   93  0.11 
Money market savings deposits  1,781,173   6,721  1.50   1,625,481   5,330  1.30 
Time deposits  1,638,072   8,956  2.17   1,284,376   5,119  1.58 
Total interest-bearing deposits  4,495,878   16,332  1.44   3,961,061   10,773  1.08 
Other borrowings  146,939   257  0.69   188,133   383  0.81 
Advances from FHLB  522,719   3,222  2.45   890,040   5,141  2.29 
Subordinated debentures  37,340   481  5.15   37,483   486  5.19 
Total interest-bearing liabilities  5,202,876   20,292  1.55   5,076,717   16,783  1.31 
               
Noninterest-bearing demand deposits  1,909,884        1,822,931      
Other liabilities  134,844        56,710      
Stockholders' equity  1,123,185        1,030,167      
Total liabilities and stockholders' equity$ 8,370,789       $7,986,525      
               
Net interest income and spread   $ 67,937  3.01%  $68,812  3.30%
Less: tax-equivalent adjustment    1,147        1,221    
Net interest income   $ 66,790       $67,591    
               
Interest income/earning assets     4.56%    4.61%
Interest expense/earning assets     1.05      0.90 
Net interest margin     3.51%    3.71%
               
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 26.13% for 2019 and 2018. The annualized taxable-equivalent adjustments utilized in
the above table to compute yields aggregated to $1.1 million and $1.2 million in 2019 and 2018, respectively.
(2) Non-accrual loans are included in the average balances.             
(3) Includes only investments that are exempt from federal taxes.            
(4) Available for sale investments are presented at amortized cost.            
               


             
Sandy Spring Bancorp, Inc. and Subsidiaries            
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED      
               
  Nine Months Ended September 30, 
  2019
  2018
 
        Annualized      Annualized 
  Average (1) Average  Average (1) Average 
(Dollars in thousands and tax-equivalent) Balances Interest Yield/Rate  Balances Interest Yield/Rate 
Assets              
Residential mortgage loans $ 1,229,790  $ 35,408  3.84%$1,091,515  $30,280  3.70%
Residential construction loans  175,236   5,582  4.26   210,774   6,203  3.93 
Total mortgage loans  1,405,026   40,990  3.89   1,302,289   36,483  3.74 
Commercial AD&C loans  671,375   29,853  5.95   597,283   25,592  5.73 
Commercial investor real estate loans  1,969,599   74,428  5.05   1,939,205   71,824  4.95 
Commercial owner occupied real estate loans  1,227,327   44,975  4.90   1,106,032   39,051  4.72 
Commercial business loans  774,375   31,479  5.43   674,973   26,052  5.16 
Total commercial loans  4,642,676   180,735  5.20   4,317,493   162,519  5.03 
Consumer loans  502,476   18,797  5.00   531,539   17,310  4.41 
Total loans (2)  6,550,178   240,522  4.91   6,151,321   216,312  4.70 
Loans held for sale  39,107   1,145  3.91   30,349   983  4.32 
Taxable securities  752,518   17,169  3.04   738,580   15,891  2.87 
Tax-exempt securities (3)  219,510   5,827  3.54   290,177   7,662  3.52 
Total investment securities (4)  972,028   22,996  3.15   1,028,757   23,553  3.05 
Interest-bearing deposits with banks  83,981   1,405  2.24   86,446   1,082  1.67 
Federal funds sold  623   8  1.78   2,607   28  1.41 
Total interest-earning assets  7,645,917   266,076  4.65   7,299,480   241,958  4.43 
               
Less: allowance for loan losses  (53,440)       (47,533)     
Cash and due from banks  64,227        69,301      
Premises and equipment, net  61,039        61,507      
Other assets  590,186        535,778      
Total assets $ 8,307,929       $7,918,533      
               
Liabilities and Stockholders' Equity              
Interest-bearing demand deposits $ 733,872   1,305  0.24%$730,520   657  0.12%
Regular savings deposits  330,377   321  0.13   390,231   488  0.17 
Money market savings deposits  1,710,520   19,617  1.53   1,520,953   13,028  1.15 
Time deposits  1,629,716   25,715  2.11   1,245,510   12,410  1.33 
Total interest-bearing deposits  4,404,485   46,958  1.43   3,887,214   26,583  0.91 
Other borrowings  158,279   945  0.80   158,939   599  0.50 
Advances from FHLB  689,224   13,389  2.60   1,000,060   15,557  2.08 
Subordinated debentures  37,376   1,462  5.22   37,518   1,436  5.11 
Total interest-bearing liabilities  5,289,364   62,754  1.59   5,083,731   44,175  1.16 
               
Noninterest-bearing demand deposits  1,797,301        1,757,573      
Other liabilities  122,564        59,371      
Stockholders' equity  1,098,700        1,017,858      
Total liabilities and stockholders' equity$ 8,307,929       $7,918,533      
               
Net interest income and spread   $ 203,322  3.06%  $197,783  3.27%
Less: tax-equivalent adjustment    3,597        3,483    
Net interest income   $ 199,725       $194,300    
               
Interest income/earning assets     4.65%    4.43%
Interest expense/earning assets     1.10      0.81 
Net interest margin     3.55%    3.62%
               
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 26.13% for 2019 and 2018. The annualized taxable-equivalent adjustments utilized in
the above table to compute yields aggregated to $3.6 million and $3.5 million in 2019 and 2018, respectively.
(2) Non-accrual loans are included in the average balances.             
(3) Includes only investments that are exempt from federal taxes.            
(4) Available for sale investments are presented at amortized cost.            
               

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