First Financial Bankshares Announces First Quarter Earnings Results

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April 20, 2017 4:05 PM EDT

ABILENE, Texas, April 20, 2017 /PRNewswire/ -- First Financial Bankshares, Inc. (NASDAQ: FFIN) today reported earnings for the first quarter of 2017 of $26.60 million, up 3.51 percent compared with earnings of $25.70 million in the same quarter last year.  Basic earnings per share were $0.40 for the first quarter of 2017 compared with $0.39 in the same quarter a year ago.

Net interest income for the first quarter of 2017 and 2016 was $57.02 million. The net interest margin, on a taxable equivalent basis, was 4.03 percent for the first quarter of 2017 compared to 4.01 percent in the fourth quarter of 2016 and 4.15 percent in the first quarter of 2016. Included in interest income for the first quarter of 2017 was $401 thousand, or three basis points in net interest margin, related to discount accretion from fair value accounting related to the Conroe and Orange acquisitions.  

The provision for loan losses was $1.95 million in the first quarter of 2017 compared with $1.99 million in the fourth quarter of 2016 and $2.33 million in the first quarter of 2016. The continued provision for loan losses in 2017 reflects the continued levels of nonperforming and classified assets, gross charge-offs, as well as the continuing economic effects related to the oil and gas industry. Nonperforming assets as a percentage of loans and foreclosed assets totaled 0.90 percent at March 31, 2017, compared with 0.86 percent at December 31, 2016, and 0.88 percent at March 31, 2016. Classified loans totaled $122.62 million at March 31, 2017, compared to $127.80 million at December 31, 2016, and $142.14 million at March 31, 2016.

At March 31, 2017, loans with oil and gas industry exposure totaled 2.22% of gross loans. These loans comprised $29.08 million of the classified loan totals and $3.21 million of the nonperforming loan totals. There were no charge-offs related to these oil and gas loans for the quarter ended March 31, 2017. At March 31, 2017, the Company's allowance for loan loss reserve specific to its total oil and gas loan portfolio totaled 6.59% of total oil and gas loans.

Noninterest income increased 7.39 percent in the first quarter of 2017 to $21.29 million compared with $19.82 million in the same quarter a year ago. Trust fees increased $1.36 million to $6.02 million in the first quarter of 2017 compared with $4.66 million in the same quarter last year, primarily due to continued growth in the fair value of Trust assets managed to $4.54 billion from $4.01 billion a year ago and an increase of $514 thousand in real estate and lease bonus fees over the same quarter a year ago. ATM, interchange and credit card fees increased 8.52 percent to $6.16 million compared with $5.68 million in the same quarter last year due to continued growth in net new accounts and debit cards. Real estate mortgage fees increased 8.86 percent in the first quarter of 2017 to $3.42 million compared with $3.14 million in the same quarter a year ago.

Noninterest expense for the first quarter of 2017 totaled $42.15 million compared to $41.08 million in the first quarter of 2016. The Company's efficiency ratio in the first quarter of 2017 was 49.67 percent compared with 49.52 percent in the same quarter last year. The increase in noninterest expense in the first quarter of 2017 was primarily driven by a $669 thousand increase in salary and employee benefit expense and an increase in fraud and operational and other losses of $499 thousand when compared to the same quarter a year ago.

As of March 31, 2017, consolidated assets for the Company totaled $6.93 billion compared to $6.81 billion at December 31, 2016 and $6.53 billion at March 31, 2016. Loans totaled $3.39 billion at quarter end compared with loans of $3.38 billion at December 31, 2016, and $3.30 billion at March 31, 2016. Deposits totaled $5.66 billion at March 31, 2017, compared to $5.48 billion at December 31, 2016, and $5.06 billion at March 31, 2016. Shareholders' equity rose to $859.35 million as of March 31, 2017, compared with $837.89 million at December 31, 2016, and $838.61 million at March 31, 2016. 

"We continue to work diligently to grow loans and deposits, reduce expenses to improve our bottom line while continuing to look for acquisition opportunities to better utilize our strong capital position and increase our return to our shareholders," said F. Scott Dueser, Chairman, President and CEO.

About First Financial Bankshares

Headquartered in Abilene, Texas, First Financial Bankshares is a financial holding company that through its subsidiary, First Financial Bank, N.A., operates multiple banking regions with 69 locations in Texas including Abilene, Acton, Albany, Aledo, Alvarado, Beaumont, Boyd, Bridgeport, Brock, Burleson, Cisco, Cleburne, Clyde, Conroe, Cut and Shoot, Decatur, Eastland, Fort Worth, Glen Rose, Granbury, Grapevine, Hereford, Huntsville, Keller, Magnolia, Mauriceville, Merkel, Midlothian, Mineral Wells, Montgomery, Moran, New Waverly, Newton, Odessa, Orange, Port Arthur, Ranger, Rising  Star,  Roby,  San  Angelo,  Southlake,  Stephenville,  Sweetwater, Tomball, Trent,  Trophy Club, Vidor, Waxahachie, Weatherford, Willis, and Willow Park. The Company also operates First Financial Trust & Asset Management Company, N.A., with seven locations and First Technology Services, Inc., a technology operating company.

The Company is listed on The NASDAQ Global Select Market under the trading symbol FFIN.  For more information about First Financial Bankshares, please visit our website at http://www.ffin.com

*****

Certain statements contained herein may be considered "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon the belief of the Company's management, as well as assumptions made beyond information currently available to the Company's management, and may be, but not necessarily are, identified by such words as "expect", "plan", "anticipate", "target", "forecast" and "goal".  Because such "forward-looking statements" are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.  Factors that could cause actual results to differ materially from the Company's expectations include competition from other financial institutions and financial holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the  Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses, and similar variables.   Other key risks are described in the Company's reports filed with the Securities and Exchange Commission, which may be obtained under "Investor Relations-Documents/Filings" on the Company's Web site or by writing or calling the Company at 325.627.7155. Except as otherwise stated in this news announcement, the Company does not undertake any obligation to update publicly or revise any forward-looking statements because of new information, future events or otherwise.

 

FIRST FINANCIAL BANKSHARES, INC.

CONSOLIDATED FINANCIAL SUMMARY  (UNAUDITED) 

(In thousands, except share and per share data)

As of

2017

2016

ASSETS

Mar. 31, 

 Dec. 31,  

 Sept. 30,  

June 30, 

Mar. 31, 

Cash and due from banks

$

163,674

$

204,782

$

166,981

$

135,092

$

139,995

Interest-bearing deposits in banks

55,165

48,574

117,334

67,746

22,993

Interest-bearing time deposits in banks

1,707

1,707

1,707

2,427

2,427

Fed funds sold

3,840

3,130

3,400

2,960

2,660

Investment securities

3,018,393

2,860,958

2,729,159

2,795,493

2,763,185

Loans

3,386,141

3,384,205

3,369,384

3,309,388

3,299,207

Allowance for loan losses

(46,192)

(45,779)

(45,298)

(45,060)

(44,072)

Net loans

3,339,949

3,338,426

3,324,086

3,264,328

3,255,135

Premises and equipment

122,787

122,685

122,725

122,326

118,208

Goodwill

139,971

139,971

139,971

139,971

139,971

Other intangible assets

3,464

3,632

3,758

3,959

4,198

Other assets

81,420

86,066

77,615

80,688

76,413

Total assets

$

6,930,370

$

6,809,931

$

6,686,736

$

6,614,990

$

6,525,185

LIABILITIES AND SHAREHOLDERS'  EQUITY

Noninterest-bearing deposits

$

1,827,609

$

1,717,722

$

1,702,993

$

1,644,812

$

1,654,271

Interest-bearing deposits

3,834,359

3,760,817

3,532,471

3,411,477

3,409,536

Total deposits

5,661,968

5,478,539

5,235,464

5,056,289

5,063,807

Borrowings

360,264

445,770

513,759

556,924

525,340

Other liabilities

48,784

47,737

69,569

135,619

97,430

Shareholders' equity

859,354

837,885

867,944

866,158

838,608

Total liabilities and shareholders' equity

$

6,930,370

$

6,809,931

$

6,686,736

$

6,614,990

$

6,525,185

Quarter Ended

2017

2016

INCOME STATEMENTS

Mar. 31, 

 Dec 31,  

 Sept. 30,  

 June 30,  

Mar. 31, 

Interest income

$

58,783

$

57,979

$

58,093

$

57,881

$

58,335

Interest expense

1,763

1,443

1,366

1,330

1,312

Net interest income

57,020

56,536

56,727

56,551

57,023

Provision for loan losses

1,950

1,993

3,833

2,058

2,328

Net interest income after provision for loan losses

55,070

54,543

52,894

54,493

54,695

Noninterest income

21,286

21,721

22,152

21,438

19,821

Noninterest expense

42,152

41,990

42,003

40,756

41,081

Net income before income taxes

34,204

34,274

33,043

35,175

33,435

Income tax expense

7,605

7,608

7,440

8,366

7,739

Net income

$

26,599

$

26,666

$

25,603

$

26,809

$

25,696

PER COMMON SHARE DATA 

Net income - basic

$

0.40

$

0.40

$

0.39

$

0.41

$

0.39

Net income - diluted

0.40

0.40

0.39

0.41

0.39

Cash dividends declared

0.18

0.18

0.18

0.18

0.16

Book Value

12.99

12.68

13.14

13.11

12.70

Market Value

$

40.10

$

45.20

$

36.44

$

32.79

$

29.58

Shares outstanding - end of period

66,131,832

66,094,695

66,063,285

66,059,912

66,043,442

Average outstanding shares - basic

66,073,399

66,037,447

66,023,069

66,016,562

65,974,559

Average outstanding shares - diluted

66,363,222

66,307,119

66,147,202

66,138,275

66,118,998

PERFORMANCE RATIOS

Return on average assets

1.57

%

1.59

%

1.54

%

1.65

%

1.58

%

Return on average equity

12.74

12.44

11.72

12.76

12.55

Net interest margin (tax equivalent)

4.03

4.01

4.04

4.12

4.15

Efficiency ratio

49.67

49.61

49.33

48.43

49.52

 

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)

Quarter Ended

2017

2016

ALLOWANCE FOR LOAN LOSSES

Mar. 31, 

Dec. 31, 

 Sept. 30,  

June 30, 

Mar. 31, 

Balance at beginning of period

$

45,779

$

45,298

$

45,060

$

44,072

$

41,877

Loans charged off

(2,026)

(1,774)

(4,372)

(1,888)

(1,782)

Loan recoveries

489

262

777

818

1,649

Net recoveries (charge-offs)

(1,537)

(1,512)

(3,595)

(1,070)

(133)

Provision for loan losses

1,950

1,993

3,833

2,058

2,328

Balance at end of period

$

46,192

$

45,779

$

45,298

$

45,060

$

44,072

Allowance for loan losses / period-end loans

1.36

%

1.35

%

1.34

%

1.36

%

1.34

%

Allowance for loan losses / nonperforming loans

159.48

161.44

131.04

112.36

156.24

Net charge-offs / average loans (annualized)

0.18

0.18

0.43

0.13

0.02

SUMMARY OF LOAN CLASSIFICATION

Special Mention

$

23,341

$

24,787

$

25,488

$

26,125

$

31,486

Substandard

99,280

103,015

101,110

106,540

110,657

Doubtful

-

-

2

-

-

Total classified loans

$

122,621

$

127,802

$

126,600

$

132,665

$

142,143

NONPERFORMING ASSETS

Nonaccrual loans

$

28,080

$

27,371

$

33,712

$

38,904

$

27,175

Accruing troubled debt restructured loans

695

701

750

961

973

Accruing loans 90 days past due

190

284

107

237

59

Total nonperforming loans

28,965

28,356

34,569

40,102

28,207

Foreclosed assets

1,553

644

369

285

821

Total nonperforming assets

$

30,518

$

29,000

$

34,938

$

40,387

$

29,028

As a % of loans and foreclosed assets

0.90

%

0.86

%

1.04

%

1.22

%

0.88

%

As a % of end of period total assets

0.44

0.43

0.52

0.61

0.44

OIL AND GAS PORTFOLIO INFORMATION

Oil and gas loans

$

75,262

$

78,483

$

86,785

$

87,857

$

92,058

Oil and gas loans as a % of total loans

2.22

%

2.32

%

2.58

%

2.65

%

2.79

%

Classified oil and gas loans

29,077

32,518

31,541

32,674

36,402

Nonaccrual oil and gas loans

3,208

4,092

5,140

5,763

4,917

Net charge-offs for oil and gas loans

-

105

104

419

517

Allowance for oil and gas loans as a % of oil and gas loans

6.59

%

6.28

%

5.60

%

6.57

%

7.37

%

CAPITAL RATIOS

Common equity Tier 1 capital ratio

17.56

%

17.30

%

17.11

%

16.64

%

16.34

%

Tier 1 capital ratio

17.56

17.30

17.11

16.64

16.34

Total capital ratio

18.72

18.45

18.28

17.79

17.47

Tier 1 leverage

10.60

10.71

10.60

10.50

10.23

Equity to assets

12.40

12.30

12.98

13.09

12.85

Quarter Ended

2017

2016

NONINTEREST INCOME

Mar. 31, 

Dec. 31, 

 Sept. 30,  

 June 30,  

Mar. 31, 

Trust fees

$

6,017

$

5,189

$

5,066

$

4,726

$

4,655

Service charges on deposits

4,550

4,773

4,796

4,404

4,413

ATM, interchange and credit card fees

6,164

6,390

6,000

5,840

5,680

Real estate mortgage fees

3,417

4,237

4,697

4,013

3,139

Net gain on sale of available-for-sale securities

3

117

239

912

2

Net gain (loss) on sale of foreclosed assets

41

112

(10)

278

76

Net gain (loss) on sale of assets

4

(103)

(168)

(74)

513

Interest on loan recoveries

154

141

709

629

633

Other noninterest income

936

865

823

710

710

Total noninterest income

$

21,286

$

21,721

$

22,152

$

21,438

$

19,821

NONINTEREST EXPENSE

Salaries and employee benefits, excluding profit sharing

$

22,233

$

21,742

$

22,193

$

22,038

$

21,545

Profit sharing expense

1,026

1,329

738

109

1,045

Loss from partial settlement of pension plan

-

267

-

-

-

Net occupancy expense

2,600

2,534

2,672

2,583

2,631

Equipment expense

3,437

3,293

3,420

3,386

3,380

FDIC insurance premiums

547

525

513

818

824

ATM, interchange and credit card expenses

1,713

1,879

1,859

1,806

1,687

Legal, tax and professional fees

2,478

2,386

2,389

2,108

2,209

Audit  fees

419

331

413

400

449

Printing, stationery and supplies

438

590

536

464

503

Amortization of intangible assets

168

168

172

199

199

Advertising and public relations

1,544

1,574

1,729

1,537

1,444

Operational and other losses

985

717

533

433

486

Other noninterest expense

4,564

4,655

4,836

4,875

4,679

Total noninterest expense

$

42,152

$

41,990

$

42,003

$

40,756

$

41,081

TAX EQUIVALENT YIELD ADJUSTMENT

$

6,550

$

6,391

$

6,271

$

6,168

$

6,115

 

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)

Three Months Ended

Three Months Ended

Mar. 31, 2017

Dec. 31, 2016

Average

Tax Equivalent

Yield /

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

3,529

$

2

0.23

%

$

4,703

$

5

0.42

%

  Interest-bearing deposits in nonaffiliated banks

134,556

274

0.83

85,907

116

0.54

  Taxable securities

1,367,331

7,431

2.17

1,281,717

6,459

2.02

  Tax exempt securities

1,529,610

17,561

4.59

1,489,463

16,958

4.55

  Loans

3,369,599

40,065

4.82

3,374,652

40,831

4.81

Total interest-earning assets

6,404,625

$

65,333

4.14

%

6,236,442

$

64,369

4.11

%

Noninterest-earning assets

446,961

434,629

Total assets

$

6,851,586

$

6,671,071

Interest-bearing liabilities:

  Deposits

$

3,808,933

$

1,590

0.17

%

$

3,580,489

$

1,305

0.14

%

  Fed funds purchased and other borrowings

448,217

173

0.16

488,240

137

0.11

Total interest-bearing liabilities

4,257,150

$

1,763

0.17

%

4,068,729

$

1,442

0.14

%

Noninterest-bearing liabilities                                                                              

1,747,532

1,749,320

Shareholders' equity

846,904

853,022

Total liabilities and shareholders' equity

$

6,851,586

$

6,671,071

Net interest income and margin (tax equivalent)

$

63,570

4.03

%

$

62,927

4.01

%

Three Months Ended

Three Months Ended

Sept. 30, 2016

June 30, 2016

Average

Tax Equivalent

Yield /

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

4,596

$

4

0.33

%

$

5,701

$

6

0.44

%

  Interest-bearing deposits in nonaffiliated banks

69,285

95

0.55

37,159

57

0.61

  Taxable securities

1,305,103

6,775

2.08

1,349,325

7,130

2.11

  Tax exempt securities

1,478,719

16,541

4.47

1,439,575

16,446

4.57

  Loans

3,349,458

40,948

4.86

3,295,557

40,410

4.93

Total interest-earning assets

6,207,161

$

64,363

4.13

%

6,127,317

$

64,049

4.20

%

Noninterest-earning assets

428,239

416,414

Total assets

$

6,635,400

$

6,543,731

Interest-bearing liabilities:

  Deposits

$

3,460,208

$

1,111

0.13

%

$

3,388,572

$

1,033

0.12

%

  Fed funds purchased and other borrowings

569,883

254

0.18

587,981

297

0.20

Total interest-bearing liabilities

4,030,091

$

1,365

0.13

%

3,976,553

$

1,330

0.14

%

Noninterest-bearing liabilities                                                                              

1,736,071

1,722,037

Shareholders' equity

869,238

845,141

Total liabilities and shareholders' equity

$

6,635,400

$

6,543,731

Net interest income and margin (tax equivalent)

$

62,998

4.04

%

$

62,719

4.12

%

 

Three Months Ended

Mar. 31, 2016

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

7,534

$

9

0.50

%

  Interest-bearing deposits in nonaffiliated banks

40,239

51

0.51

  Taxable securities

1,323,606

7,262

2.19

  Tax exempt securities

1,428,178

16,326

4.57

  Loans

3,312,664

40,802

4.95

Total interest-earning assets

6,112,221

$

64,450

4.24

%

Noninterest-earning assets

432,862

Total assets

$

6,545,083

Interest-bearing liabilities:

  Deposits

$

3,445,622

$

1,052

0.12

%

  Fed funds purchased and other borrowings

562,569

260

0.19

Total interest-bearing liabilities

4,008,191

$

1,312

0.13

%

Noninterest-bearing liabilities                                                                              

1,713,122

Shareholders' equity

823,770

Total liabilities and shareholders' equity

$

6,545,083

Net interest income and margin (tax equivalent)

$

63,138

4.15

%

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/first-financial-bankshares-announces-first-quarter-earnings-results-300442766.html

SOURCE First Financial Bankshares, Inc.


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