BancFirst Corporation Reports Fourth Quarter Earnings
OKLAHOMA CITY, Jan. 21, 2021 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS:BANF) reported net income of $35.4 million, or $1.06 diluted earnings per share, for the fourth quarter of 2020 compared to net income of $35.5 million, or $1.07 diluted earnings per share, for the fourth quarter of 2019. Net income for the twelve months ended December 31, 2020 was $99.6 million, or $3.00 diluted earnings per share, compared to $134.9 million, or $4.05 diluted earnings per share, for the year ended December 31, 2019. The results for 2020 were negatively impacted by a higher provision for credit losses. Net income for the year ended December 31, 2020 includes the entire year of net income of Pegasus Bank in Dallas, Texas, which was acquired on August 15, 2019, and the income and expenses associated with the purchase of assets and assumption of liabilities on March 5, 2020, from The Citizens State Bank of Okemah. The results for the prior year include Pegasus Bank acquisition related expenses of approximately $3.1 million.
The provision for credit losses for the fourth quarter of 2020 was $5.0 million compared to $1.4 million a year ago and $57.7 million through the first three quarters of 2020. BancFirst Corporation Executive Chairman David Rainbolt commented, "Our provision for credit losses was substantially reduced from previous quarters due to improvements in projected outcomes for the economic effects of the pandemic. The rollout of the vaccine and extension of the Cares Act stimulus, combined with improved energy prices and jobs data, justify a cessation to the outsized provisions seen in prior quarters."
The Company's net interest income for the fourth quarter of 2020 increased to $79.5 million compared to $73.9 million for the fourth quarter of 2019. Net interest income increased for the fourth quarter of 2020 due to loan growth, PPP fee income of approximately $8.0 million and the decrease in interest rates paid on deposits. The net interest margin for the quarter was 3.54% compared to 3.78% a year ago. The Company had net charge-offs for the quarter of 0.30% of average loans, compared to net charge-offs of 0.06% of average loans for the fourth quarter of 2019. Noninterest income for the quarter totaled $35.4 million, compared to $35.5 million last year. Noninterest expense for the quarter totaled $65.6 million compared to $66.3 million last year. Overall noninterest expense decreased during the fourth quarter of 2020 compared to the fourth quarter of 2019 primarily due to $2.3 million of amortization of new market tax credits in 2019. However, deposit insurance, net expense from other real estate owned, net occupancy and depreciation increased during the fourth quarter of 2020 compared to 2019. The Company's effective tax rate was 20.3% compared to 15.0% for the fourth quarter of 2019. The effective tax rate for the fourth quarter of 2019 was lower due to the purchase of tax credits during the quarter.
At December 31, 2020, the Company's total assets were $9.2 billion, an increase of $646.6 million from December 31, 2019. Securities of $555.2 million were up $63.6 million from December 31, 2019. Loans totaled $6.4 billion, an increase of $775.1 million from December 31, 2019. Deposits totaled $8.1 billion, an increase of $581.1 million from the December 31, 2019 total. The increase in assets, loans and deposits were primarily related to the Paycheck Protection Program (PPP) and other government stimulus. At December 31, 2020, the balance of the Paycheck Protection Program loans was $652.7 million. The Company's total stockholders' equity was $1.1 billion, an increase of $62.9 million over December 31, 2019. Off-balance sheet sweep accounts were $2.7 billion at December 31, 2020 compared to $2.0 billion at December 31, 2019.
Nonaccrual loans represented 0.58% of total loans at December 31, 2020, up from 0.32% at year-end 2019, but down from 1.24% at September 30, 2020. Non-performing assets represented 0.90% of total assets at December 31, 2020, up from 0.63% at December 31, 2019 as a result of loan migration from non-accrual loans to other real estate owned (OREO) during the fourth quarter of 2020. The allowance to total loans was 1.42% at December 31, 2020, up from 0.96% at year-end 2019. The allowance to nonaccrual loans was approximately 243% at December 31, 2020, compared to 302% at year-end 2019, and 129% at September 30, 2020.
BancFirst Corporation CEO David Harlow commented, "In a very challenging year the Company was able to report earnings of $3.00 per diluted share while substantially building loan loss reserves, increasing our dividend for the 27th consecutive year and growing total stockholders' equity and tangible book value per share. The outlook for 2021 is certainly better today than we would have projected at the outset of the pandemic; however, many consumers and certain sectors of the economy continue to struggle and the ultimate outcome for many businesses when the stimulus subsides is far from certain."
BancFirst Corporation (the Company) is an Oklahoma based financial services holding company. The Company operates two subsidiary banks, BancFirst, an Oklahoma state-chartered bank with 107 banking locations serving 59 communities across Oklahoma, and Pegasus Bank, with 3 banking locations in Dallas, TX. 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) | |||||||||||||||||||
2020 | 2020 | 2020 | 2020 | 2019 | |||||||||||||||
4th Qtr | 3rd Qtr | 2nd Qtr | 1st Qtr | 4th Qtr | |||||||||||||||
Condensed Income Statements: | |||||||||||||||||||
Net interest income | $ | 79,535 | $ | 75,852 | $ | 77,208 | $ | 74,073 | $ | 73,939 | |||||||||
Provision for credit losses | 4,992 | 18,740 | 19,333 | 19,583 | 1,412 | ||||||||||||||
Non-interest income: | |||||||||||||||||||
Trust revenue | 2,976 | 3,131 | 3,368 | 3,655 | 3,682 | ||||||||||||||
Service charges on deposits | 19,796 | 19,078 | 16,760 | 18,804 | 19,938 | ||||||||||||||
Securities transactions | 156 | — | (595) | 50 | (9) | ||||||||||||||
Income from sales of loans | 1,852 | 1,873 | 1,561 | 781 | 1,089 | ||||||||||||||
Insurance commissions | 5,680 | 5,197 | 4,443 | 5,676 | 5,076 | ||||||||||||||
Cash management | 3,135 | 3,701 | 4,255 | 4,320 | 4,258 | ||||||||||||||
Other | 1,825 | 1,595 | 2,290 | 1,859 | 1,490 | ||||||||||||||
Total noninterest income | 35,420 | 34,575 | 32,082 | 35,145 | 35,524 | ||||||||||||||
Non-interest expense: | |||||||||||||||||||
Salaries and employee benefits | 40,750 | 41,995 | 42,226 | 39,756 | 40,375 | ||||||||||||||
Occupancy expense, net | 4,533 | 4,503 | 3,839 | 3,546 | 3,738 | ||||||||||||||
Depreciation | 3,779 | 3,795 | 3,544 | 3,491 | 3,355 | ||||||||||||||
Amortization of intangible assets | 915 | 968 | 968 | 964 | 1,007 | ||||||||||||||
Data processing services | 1,763 | 1,669 | 1,629 | 1,692 | 1,634 | ||||||||||||||
Net expense from other real estate owned | 420 | 196 | (12) | (2,135) | (424) | ||||||||||||||
Marketing and business promotion | 1,671 | 1,485 | 1,485 | 2,355 | 2,327 | ||||||||||||||
Deposit insurance | 857 | 723 | 365 | 136 | 147 | ||||||||||||||
Other | 10,923 | 10,749 | 10,607 | 11,580 | 14,137 | ||||||||||||||
Total noninterest expense | 65,611 | 66,083 | 64,651 | 61,385 | 66,296 | ||||||||||||||
Income before income taxes | 44,352 | 25,604 | 25,306 | 28,250 | 41,755 | ||||||||||||||
Income tax expense | 8,994 | 4,714 | 4,576 | 5,642 | 6,248 | ||||||||||||||
Net income | $ | 35,358 | $ | 20,890 | $ | 20,730 | $ | 22,608 | $ | 35,507 | |||||||||
Per Common Share Data: | |||||||||||||||||||
Net income-basic | $ | 1.08 | $ | 0.64 | $ | 0.64 | $ | 0.69 | $ | 1.09 | |||||||||
Net income-diluted | 1.06 | 0.63 | 0.63 | 0.68 | 1.07 | ||||||||||||||
Cash dividends declared | 0.34 | 0.34 | 0.32 | 0.32 | 0.32 | ||||||||||||||
Common shares outstanding | 32,719,852 | 32,679,191 | 32,662,691 | 32,646,691 | 32,694,268 | ||||||||||||||
Average common shares outstanding - | |||||||||||||||||||
Basic | 32,690,296 | 32,668,789 | 32,651,262 | 32,679,587 | 32,673,438 | ||||||||||||||
Diluted | 33,275,550 | 33,168,938 | 33,075,493 | 33,287,359 | 33,366,848 | ||||||||||||||
Performance Ratios: | |||||||||||||||||||
Return on average assets | 1.45 | % | 0.86 | % | 0.88 | % | 1.07 | % | 1.66 | % | |||||||||
Return on average stockholders' equity | 13.25 | 7.89 | 7.99 | 8.87 | 13.76 | ||||||||||||||
Net interest margin | 3.54 | 3.40 | 3.54 | 3.82 | 3.78 | ||||||||||||||
Efficiency ratio | 57.08 | 59.84 | 59.16 | 56.20 | 60.56 | ||||||||||||||
BancFirst Corporation | |||||||
Summary Financial Information | |||||||
(Dollars in thousands, except per share and share data - Unaudited) | |||||||
Twelve months ended | |||||||
December 31, | |||||||
2020 | 2019 | ||||||
Condensed Income Statements: | |||||||
Net interest income | $ | 306,668 | $ | 281,921 | |||
Provision for credit losses | 62,648 | 8,287 | |||||
Non-interest income: | |||||||
Trust revenue | 13,130 | 13,599 | |||||
Service charges on deposits | 74,438 | 76,581 | |||||
Securities transactions | (389) | 812 | |||||
Income from sales of loans | 6,067 | 3,619 | |||||
Insurance commissions | 20,996 | 20,296 | |||||
Cash management | 15,411 | 16,866 | |||||
Other | 7,569 | 5,456 | |||||
Total noninterest income | 137,222 | 137,229 | |||||
Non-interest expense: | |||||||
Salaries and employee benefits | 164,727 | 153,024 | |||||
Occupancy expense, net | 16,421 | 12,704 | |||||
Depreciation | 14,609 | 12,623 | |||||
Amortization of intangible assets | 3,815 | 3,366 | |||||
Data processing services | 6,753 | 5,843 | |||||
Net expense from other real estate owned | (1,531) | (785) | |||||
Marketing and business promotion | 6,996 | 8,554 | |||||
Deposit insurance | 2,081 | 1,143 | |||||
Other | 43,859 | 44,829 | |||||
Total noninterest expense | 257,730 | 241,301 | |||||
Income before income taxes | 123,512 | 169,562 | |||||
Income tax expense | 23,926 | 34,683 | |||||
Net income | $ | 99,586 | $ | 134,879 | |||
Per Common Share Data: | |||||||
Net income-basic | $ | 3.05 | $ | 4.13 | |||
Net income-diluted | 3.00 | 4.05 | |||||
Cash dividends declared | 1.32 | 1.24 | |||||
Common shares outstanding | 32,719,852 | 32,694,268 | |||||
Average common shares outstanding - | |||||||
Basic | 32,672,522 | 32,639,396 | |||||
Diluted | 33,210,952 | 33,329,844 | |||||
Performance Ratios: | |||||||
Return on average assets | 1.06 | % | 1.69 | % | |||
Return on average stockholders' equity | 9.52 | 14.04 | |||||
Net interest margin | 3.57 | 3.85 | |||||
Efficiency ratio | 58.06 | 57.57 | |||||
BancFirst Corporation | ||||||||||||||||||||
Summary Financial Information | ||||||||||||||||||||
(Dollars in thousands, except per share and share data - Unaudited) | ||||||||||||||||||||
2020 | 2020 | 2020 | 2020 | 2019 | ||||||||||||||||
4th Qtr | 3rd Qtr | 2nd Qtr | 1st Qtr | 4th Qtr | ||||||||||||||||
Balance Sheet Data: | ||||||||||||||||||||
Total assets | $ | 9,212,357 | $ | 9,618,868 | $ | 9,612,453 | $ | 8,669,096 | $ | 8,565,758 | ||||||||||
Interest-bearing deposits with banks | 1,336,394 | 1,609,462 | 1,583,116 | 1,356,826 | 1,646,238 | |||||||||||||||
Debt securities | 555,196 | 596,941 | 608,031 | 591,987 | 491,626 | |||||||||||||||
Total loans | 6,448,225 | 6,660,694 | 6,696,856 | 6,006,065 | 5,673,144 | |||||||||||||||
Allowance for credit losses | (91,366) | (106,126) | (89,500) | (70,080) | (54,238) | |||||||||||||||
Deposits | 8,064,704 | 8,495,891 | 8,486,671 | 7,573,200 | 7,483,635 | |||||||||||||||
Stockholders' equity | 1,067,885 | 1,043,752 | 1,034,199 | 1,023,380 | 1,004,989 | |||||||||||||||
Book value per common share | 32.64 | 31.94 | 31.66 | 31.35 | 30.74 | |||||||||||||||
Tangible book value per common share (non-GAAP)(1) | 27.47 | 26.74 | 26.43 | 26.09 | 25.50 | |||||||||||||||
Balance Sheet Ratios: | ||||||||||||||||||||
Average loans to deposits | 77.02 | % | 78.55 | % | 79.78 | % | 77.75 | % | 75.83 | % | ||||||||||
Average earning assets to total assets | 91.82 | 91.99 | 92.23 | 91.51 | 91.50 | |||||||||||||||
Average stockholders' equity to average assets | 10.91 | 10.90 | 10.96 | 12.02 | 12.04 | |||||||||||||||
Asset Quality Data: | ||||||||||||||||||||
Past due loans | $ | 4,802 | $ | 6,412 | $ | 5,382 | $ | 10,065 | $ | 11,834 | ||||||||||
Nonaccrual loans (5) | 37,545 | 82,385 | 49,477 | 45,181 | 17,965 | |||||||||||||||
Restructured loans | 7,784 | 2,837 | 3,213 | 3,158 | 18,010 | |||||||||||||||
Total nonperforming and restructured loans | 50,131 | 91,634 | 58,072 | 58,404 | 47,809 | |||||||||||||||
Other real estate owned and repossessed assets | 32,480 | 4,939 | 4,948 | 6,001 | 6,073 | |||||||||||||||
Total nonperforming and restructured assets | 82,611 | 96,573 | 63,020 | 64,405 | 53,882 | |||||||||||||||
Nonaccrual loans to total loans | 0.58 | % | 1.24 | % | 0.74 | % | 0.75 | % | 0.32 | % | ||||||||||
Nonaccrual loans to total Non-PPP loans (non-GAAP)(3) | 0.65 | 1.41 | 0.84 | 0.75 | 0.32 | |||||||||||||||
Nonperforming and restructured loans to total loans | 0.78 | 1.38 | 0.87 | 0.97 | 0.84 | |||||||||||||||
Nonperforming and restructured loans to total Non-PPP loans (non-GAAP)(3) | 0.86 | 1.57 | 0.99 | 0.97 | 0.84 | |||||||||||||||
Nonperforming and restructured assets to total assets | 0.90 | 1.00 | 0.66 | 0.74 | 0.63 | |||||||||||||||
Allowance for credit losses to total loans | 1.42 | 1.59 | 1.34 | 1.17 | 0.96 | |||||||||||||||
Allowance for credit losses to total Non-PPP loans (non-GAAP)(3) | 1.58 | 1.82 | 1.52 | 1.17 | 0.96 | |||||||||||||||
Allowance for credit losses to nonaccrual loans | 243.35 | 128.82 | 180.89 | 155.11 | 301.91 | |||||||||||||||
Allowance for credit losses to nonperforming and restructured loans | 182.26 | 115.81 | 154.12 | 119.99 | 113.45 | |||||||||||||||
Net charge-offs to average loans | 0.30 | 0.03 | 0.00 | 0.02 | 0.06 | |||||||||||||||
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(2): | ||||||||||||||||||||
Stockholders' equity | $ | 1,067,885 | $ | 1,043,752 | $ | 1,034,199 | $ | 1,023,380 | $ | 1,004,989 | ||||||||||
Less goodwill | 149,922 | 149,922 | 149,922 | 149,923 | 148,604 | |||||||||||||||
Less intangible assets, net | 18,999 | 19,914 | 20,882 | 21,850 | 22,608 | |||||||||||||||
Tangible stockholders' equity (non-GAAP) | $ | 898,964 | $ | 873,916 | $ | 863,395 | $ | 851,607 | $ | 833,777 | ||||||||||
Common shares outstanding | 32,719,852 | 32,679,191 | 32,662,691 | 32,646,691 | 32,694,268 | |||||||||||||||
Tangible book value per common share (non-GAAP) | $ | 27.47 | $ | 26.74 | $ | 26.43 | $ | 26.09 | $ | 25.50 | ||||||||||
(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. | ||||||||||||||||||||
Reconciliation of Non-PPP loan ratios (non-GAAP)(4): | ||||||||||||||||||||
Total loans | $ | 6,448,225 | $ | 6,660,694 | $ | 6,696,856 | $ | 6,006,065 | $ | 5,673,144 | ||||||||||
Less PPP loans | 652,693 | 831,703 | 825,093 | — | — | |||||||||||||||
Total Non-PPP loans (non-GAAP) | $ | 5,795,532 | $ | 5,828,991 | $ | 5,871,763 | $ | 6,006,065 | $ | 5,673,144 | ||||||||||
Nonaccrual loans (5) | 37,545 | 82,385 | 49,477 | 45,181 | 17,965 | |||||||||||||||
Nonaccrual loans to total Non-PPP loans (non-GAAP) | 0.65 | % | 1.41 | % | 0.84 | % | 0.75 | % | 0.32 | % | ||||||||||
Total nonperforming and restructured loans | 50,131 | 91,634 | 58,072 | 58,404 | 47,809 | |||||||||||||||
Nonperforming and restructured loans to total Non-PPP loans (non-GAAP) | 0.86 | % | 1.57 | % | 0.99 | % | 0.97 | % | 0.84 | % | ||||||||||
Allowance for credit losses | (91,366) | (106,126) | (89,500) | (70,080) | (54,238) | |||||||||||||||
Allowance for credit losses to total Non-PPP loans (non-GAAP) | 1.58 | % | 1.82 | % | 1.52 | % | 1.17 | % | 0.96 | % | ||||||||||
(3) Refer to the "Reconciliation of Non-PPP loan ratios (non-GAAP)" Table. | ||||||||||||||||||||
(4) Nonaccrual loans to total Non-PPP loans is nonaccrual loans, divided by total loans less Paycheck Protection Program (PPP) loans. Nonperforming and restructured loans to total Non-PPP loans is nonperforming and restructured loans, divided by total loans less PPP loans. Allowance to total Non-PPP loans is allowance for credit losses, divided by total loans less PPP loans. These amounts are non-GAAP financial measures but have been included as they are considered critical metrics with which to analyze and evaluate the financial condition and capital strength of the Company. These measures should not be considered substitutes for operating results determined in accordance with GAAP. | ||||||||||||||||||||
(5) Government Agencies guarantee approximately $7.8 million of nonaccrual loans at December 31, 2020. | ||||||||||||||||||||
BancFirst Corporation | |||||||||||||||||||||||||
Consolidated Average Balance Sheets | |||||||||||||||||||||||||
And Interest Margin Analysis | |||||||||||||||||||||||||
Taxable Equivalent Basis | |||||||||||||||||||||||||
(Dollars in thousands - Unaudited) | |||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||
December 31, 2020 | December 31, 2020 | ||||||||||||||||||||||||
Interest | Average | Interest | Average | ||||||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | ||||||||||||||||||||
Balance | Expense | Rate | Balance | Expense | Rate | ||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
Earning assets: | |||||||||||||||||||||||||
Loans | $ | 6,599,933 | $ | 79,815 | 4.80 | % | $ | 6,432,455 | $ | 312,195 | 4.84 | % | |||||||||||||
Securities – taxable | 558,046 | 1,926 | 1.37 | 556,931 | 8,591 | 1.54 | |||||||||||||||||||
Securities – tax exempt | 30,131 | 131 | 1.73 | 28,969 | 616 | 2.12 | |||||||||||||||||||
Interest bearing deposits with banks and FFS | 1,719,900 | 463 | 0.11 | 1,562,383 | 6,049 | 0.39 | |||||||||||||||||||
Total earning assets | 8,908,010 | 82,335 | 3.67 | 8,580,738 | 327,451 | 3.81 | |||||||||||||||||||
Nonearning assets: | |||||||||||||||||||||||||
Cash and due from banks | 252,082 | 220,995 | |||||||||||||||||||||||
Interest receivable and other assets | 638,173 | 611,966 | |||||||||||||||||||||||
Allowance for credit losses | (97,046) | (76,501) | |||||||||||||||||||||||
Total nonearning assets | 793,209 | 756,460 | |||||||||||||||||||||||
Total assets | $ | 9,701,219 | $ | 9,337,198 | |||||||||||||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||||||||||||||
Interest bearing liabilities: | |||||||||||||||||||||||||
Transaction deposits | $ | 711,266 | $ | 131 | 0.07 | % | $ | 744,632 | $ | 940 | 0.13 | % | |||||||||||||
Savings deposits | 3,404,226 | 903 | 0.11 | 3,273,903 | 9,385 | 0.29 | |||||||||||||||||||
Time deposits | 684,992 | 1,434 | 0.83 | 695,637 | 8,147 | 1.17 | |||||||||||||||||||
Short-term borrowings | 1,075 | - | 0.07 | 2,745 | 8 | 0.30 | |||||||||||||||||||
Long-term borrowings | - | - | - | 1,107 | - | - | |||||||||||||||||||
Junior subordinated debentures | 26,804 | 492 | 7.29 | 26,804 | 1,966 | 7.31 | |||||||||||||||||||
Total interest bearing liabilities | 4,828,363 | 2,960 | 0.24 | 4,744,828 | 20,446 | 0.43 | |||||||||||||||||||
Interest free funds: | |||||||||||||||||||||||||
Noninterest bearing deposits | 3,768,493 | 3,503,187 | |||||||||||||||||||||||
Interest payable and other liabilities | 45,673 | 46,048 | |||||||||||||||||||||||
Stockholders' equity | 1,058,690 | 1,043,135 | |||||||||||||||||||||||
Total interest free funds | 4,872,856 | 4,592,370 | |||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 9,701,219 | $ | 9,337,198 | |||||||||||||||||||||
Net interest income | $ | 79,375 | $ | 307,005 | |||||||||||||||||||||
Net interest spread | 3.43 | % | 3.38 | % | |||||||||||||||||||||
Effect of interest free funds | 0.11 | % | 0.19 | % | |||||||||||||||||||||
Net interest margin | 3.54 | % | 3.57 | % | |||||||||||||||||||||
SOURCE BancFirst
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