First Financial Bankshares Announces Second Quarter Earnings Results

Jul 18, 2013, 16:05 ET from First Financial Bankshares, Inc.

ABILENE, Texas, July 18, 2013 /PRNewswire/ -- First Financial Bankshares, Inc. (NASDAQ: FFIN) today reported earnings for the second quarter of 2013 of $19.49 million, up 6.21 percent compared with earnings of $18.35 million in the same quarter last year.  Basic earnings per share were $0.62 for the second quarter of 2013 compared with $0.58 in the same quarter a year ago.

All amounts for the second quarter of 2013 include the results of the Company's acquisition of Orange Savings Bank, SSB, Orange, Texas, which was effective on May 31, 2013. As of May 31, 2013, Orange had total loans of $293.29 million and total deposits of $385.95 million.

Net interest income increased 7.64 percent to $41.50 million compared with $38.56 million in 2012. The net interest margin, on a taxable equivalent basis, was 4.18 percent compared with 4.33 percent in the same quarter last year and 4.19 percent in the first quarter of this year. 

The provision for loan losses was $832 thousand in the second quarter of 2013 compared with $759 thousand in the same quarter last year and $401 thousand in the first quarter of this year. Nonperforming assets as a percentage of loans and foreclosed assets totaled 1.20 percent at June 30, 2013, compared with 1.20 percent at March 31, 2013, and 1.76 percent at June 30, 2012.  Classified loans totaled $87.83 million at June 30, 2013, compared to $70.18 million at March 31, 2013, and $80.86 million at June 30, 2012. The increase in dollar amount of nonperforming assets and classified loans was primarily from the Orange Savings Bank, SSB acquisition.

Noninterest income increased 12.54 percent in the second quarter of 2013 to $15.15 million compared with $13.46 million in the same quarter a year ago. Trust fees increased to $3.95 million in the second quarter of 2013 compared with $3.67 million in the same quarter last year, primarily due to continued growth in the fair value of Trust assets managed to $3.05 billion from $2.65 billion a year ago. ATM, interchange and credit card fees increased 10.49 percent to $4.18 million compared with $3.78 million in the same quarter last year.  Real estate mortgage income increased to $1.69 million in the second quarter of 2013 compared with $1.22 million in the same quarter a year ago.

Noninterest expense increased in the second quarter of 2013 to $29.91 million from $26.75 million in the same quarter last year. The Company's efficiency ratio in the second quarter of 2013 was 49.25 percent compared with 48.02 percent in the same quarter last year. Healthcare expenses for the second quarter of 2013 totaled $1.28 million compared to $833 thousand in the same quarter a year ago. Also included in noninterest expense in the second quarter of 2013 was $232 thousand and $226 thousand related to the acquisition of Orange Savings Bank, SSB and database consolidation technology costs, respectively.

For the first half of 2013, net income increased 5.43 percent to $38.07 million from $36.11 million a year ago. Basic earnings per share rose to $1.20 in the first half of 2013 from $1.15 in the same period last year. Net interest income increased 4.37 percent to $80.17 million in the first half of 2013 from $76.81 million in the same period a year ago. The provision for loan losses totaled $1.23 million compared with $2.06 million in the first half of the previous year. Noninterest income was $29.11 million in the first half of 2013 compared with $26.76 million a year ago. Noninterest expense rose to $57.38 million in the first half of 2013 compared with $53.21 million last year.

As of June 30, 2013, consolidated assets for the Company totaled $4.98 billion compared with $4.29 billion a year ago. Loans totaled $2.58 billion at quarter end compared to $1.92 billion a year ago. Total deposits were $3.92 billion as of June 30, 2013, versus $3.39 billion a year earlier.  Shareholders' equity rose to $575.86 million as of June 30, 2013, compared with $534.26 million at June 30, 2012. 

"We are pleased to report another positive quarter and are excited about our Orange acquisition and welcome their employees and customers to First Financial," said F. Scott Dueser, Chairman, President and CEO. "In the second half of the year, we will continue to pursue opportunities for acquisitions and for internal growth while remaining vigilant over expenses and loan quality."

About First Financial Bankshares

Headquartered in Abilene, Texas, First Financial Bankshares is a financial holding company that operates 12 banking regions with 61 locations in Texas including Abilene, Acton, Albany, Aledo, Alvarado, Boyd, Bridgeport, Brock, Burleson, Cisco, Cleburne, Clyde, Decatur, Eastland, Fort Worth, Glen Rose, Granbury, Grapevine, Hereford, Huntsville, Keller, Mauriceville, McLewis, Merkel, Midlothian, Mineral Wells, Moran, Newton, Odessa, Orange, Port Arthur, Ranger, Rising Star, Roby, San Angelo, Southlake, Stephenville, Sweetwater, Trent, Trophy Club, Vidor, Waxahachie, Weatherford and Willow Park. The Company also operates First Financial Trust & Asset Management Company, N.A., with six 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

2013

2012

ASSETS:

June 30, 

Mar. 31, 

Dec. 31, 

Sept. 30, 

June 30,

Cash and due from banks

$

138,087

$

113,958

$

207,018

$

128,606

$

122,534

Interest-bearing deposits in banks

6,624

20,065

139,676

25,633

25,794

Interest-bearing time deposits in banks

39,350

45,172

49,005

67,506

74,594

Fed funds sold

16,025

3,175

14,045

23,400

10,100

Investment securities

1,975,490

1,959,054

1,820,096

1,883,864

1,963,367

Loans

2,578,883

2,138,137

2,088,623

2,003,854

1,918,292

Allowance for loan losses

(34,099)

(34,672)

(34,839)

(34,932)

(34,747)

Net loans

2,544,784

2,103,465

2,053,784

1,968,922

1,883,545

Premises and equipment

94,808

86,265

84,122

80,580

80,404

Goodwill

94,882

71,865

71,865

71,865

71,865

Other intangible assets

2,366

98

108

136

175

Other assets

70,189

52,863

62,293

60,035

59,426

Total assets

$

4,982,605

$

4,455,980

$

4,502,012

$

4,310,547

$

4,291,804

LIABILITIES AND SHAREHOLDERS'  EQUITY:

Noninterest-bearing deposits

$

1,305,049

$

1,237,840

$

1,311,708

$

1,200,154

$

1,156,238

Interest-bearing deposits

2,612,540

2,312,286

2,320,876

2,244,244

2,235,942

Total deposits

3,917,589

3,550,126

3,632,584

3,444,398

3,392,180

Short-term borrowings

431,575

263,345

259,697

254,480

251,428

Other liabilities

57,577

78,257

52,768

61,757

113,933

Shareholders' equity

575,864

564,252

556,963

549,912

534,263

Total liabilities and shareholders' equity

$

4,982,605

$

4,455,980

$

4,502,012

$

4,310,547

$

4,291,804

Quarter Ended

2013

2012

INCOME STATEMENTS

June 30, 

Mar. 31, 

Dec. 31, 

Sept. 30, 

June 30,

Interest income

$

42,446

$

39,575

$

39,801

$

40,287

$

39,911

Interest expense

946

904

1,049

1,168

1,355

Net interest income

41,500

38,671

38,752

39,119

38,556

Provision for loan losses

832

401

642

787

759

Net interest income after provision for loan losses

40,668

38,270

38,110

38,332

37,797

Noninterest income

15,153

13,960

14,948

15,499

13,464

Noninterest expense

29,911

27,471

28,633

27,203

26,745

Net income before income taxes

25,910

24,759

24,425

26,628

24,516

Income tax expense

6,420

6,182

6,107

6,828

6,165

Net income

$

19,490

$

18,577

$

18,318

$

19,800

$

18,351

PER COMMON SHARE DATA 

Net income - basic

$

0.62

$

0.59

$

0.58

$

0.63

$

0.58

Net income - diluted

0.61

0.59

0.58

0.63

0.58

Cash dividends declared

0.26

0.25

0.25

0.25

0.25

Shares outstanding - end of period

31,967,424

31,519,973

31,496,881

31,488,530

31,481,747

Average outstanding shares - basic

31,683,355

31,507,975

31,490,402

31,484,375

31,478,980

Average outstanding shares - diluted

31,809,840

31,601,364

31,530,907

31,502,172

31,497,241

PERFORMANCE RATIOS

Return on average assets

1.67

%

1.71

%

1.68

%

1.84

%

1.75

%

Return on average equity

13.53

13.41

13.09

14.53

14.01

Net interest margin (tax equivalent)

4.18

4.19

4.17

4.26

4.33

Efficiency ratio

49.25

48.68

49.86

46.61

48.02

Six Months Ended

June 30,

INCOME STATEMENTS

2013

2012

Interest income

$

82,022

$

79,708

Interest expense

1,851

2,895

Net interest income

80,171

76,813

Provision for loan losses

1,233

2,055

Net interest income after provision for loan losses

78,938

74,758

Noninterest income

29,113

26,762

Noninterest expense

57,382

53,213

Net income before income taxes

50,669

48,307

Income tax expense

12,602

12,200

Net income

$

38,067

$

36,107

PER COMMON SHARE DATA 

Net income - basic

$

1.20

$

1.15

Net income - diluted

1.20

1.15

Cash dividends 

0.51

0.49

Book Value

18.01

16.97

Market Value

55.66

34.56

Shares outstanding - end of period

31,967,424

31,481,747

Average outstanding shares - basic

31,596,150

31,472,843

Average outstanding shares - diluted

31,709,971

31,474,653

PERFORMANCE RATIOS

Return on average assets

1.69

%

1.74

%

Return on average equity

13.47

13.90

Net interest margin (tax equivalent)

4.18

4.36

Efficiency ratio

48.98

48.05

 

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)

Quarter Ended

2013

2012

ALLOWANCE FOR LOAN LOSSES

June 30, 

Mar. 31, 

Dec. 31,

Sept. 30,

June 30,

Balance at beginning of period

$

34,672

$

34,839

$

34,932

$

34,747

$

34,529

Loans charged off

(1,570)

(823)

(1,119)

(1,064)

(766)

Loan recoveries

165

255

384

462

225

Net charge-offs

(1,405)

(568)

(735)

(602)

(541)

Provision for loan losses

832

401

642

787

759

Balance at end of period

$

34,099

$

34,672

$

34,839

$

34,932

$

34,747

Allowance for loan losses /

     period-end loans

*

1.32

%

1.62

%

1.67

%

1.74

%

1.81

%

Allowance for loan losses /

     nonperforming loans

128.75

153.87

159.10

143.45

130.08

Net charge-offs / average loans

     (annualized)

0.24

0.11

0.14

0.12

0.12

     * Reflects the impact of loans acquired in the Orange Savings Bank, SSB acquisition, which were initially recorded at fair value with no allocated allowance for loan losses

NONPERFORMING ASSETS

Nonaccrual loans

$

26,297

$

22,509

$

21,800

$

24,283

$

26,606

Accruing loans 90 days past due

187

24

97

69

105

Total nonperforming loans

26,484

22,533

21,897

24,352

26,711

Foreclosed assets

4,589

3,185

3,565

6,373

7,149

Total nonperforming assets

$

31,073

$

25,718

$

25,462

$

30,725

$

33,860

As a % of loans and foreclosed assets

1.20

%

1.20

%

1.22

%

1.53

%

1.76

%

As a % of end of period total assets

0.62

0.58

0.57

0.71

0.79

CAPITAL RATIOS

Tier 1 risk-based

15.20

%

17.54

%

17.43

%

17.66

%

17.23

%

Total risk-based

16.31

18.80

18.68

18.92

18.48

Tier 1 leverage

10.32

10.69

10.60

10.49

10.36

Equity to assets

11.56

12.66

12.37

12.76

12.45

Quarter Ended

2013

2012

NONINTEREST INCOME

June 30, 

Mar. 31, 

Dec. 31,

Sept. 30,

June 30,

Trust fees

$

3,953

$

3,793

$

3,616

$

3,723

$

3,670

Service charges on deposits

4,316

3,895

4,432

4,337

4,042

ATM, interchange and credit card fees

4,181

3,729

3,961

3,767

3,784

Real estate mortgage fees

1,686

1,384

1,331

1,495

1,218

Net gain on sale of available-for-sale securities

33

222

565

1,479

382

Net gain (loss) on sale of foreclosed assets

17

(316)

162

(106)

(404)

Net gain (loss) on sale of assets

1

168

5

(32)

105

Other noninterest income

966

1,085

876

836

667

Total noninterest income

$

15,153

$

13,960

$

14,948

$

15,499

$

13,464

NONINTEREST EXPENSE

Salaries and employee benefits, excluding profit sharing

$

14,968

$

14,101

$

13,565

$

13,502

$

13,304

Profit sharing expense

1,183

1,079

1,441

1,343

885

Net occupancy expense

2,064

1,766

1,790

1,806

1,743

Equipment expense

2,380

2,281

2,269

2,269

2,144

FDIC insurance premiums

568

572

565

563

565

ATM, interchange and credit card expenses

1,347

1,340

1,432

1,317

1,450

Legal, tax and professional fees

1,272

993

1,162

1,019

968

Audit  fees

351

334

323

311

283

Printing, stationery and supplies

498

472

487

468

511

Amortization of intangible assets

33

10

28

38

38

Advertising and public relations

1,100

994

1,085

998

953

Correspondent bank service charges

222

202

220

220

216

Other noninterest expense

3,925

3,327

4,266

3,349

3,685

Total noninterest expense

$

29,911

$

27,471

$

28,633

$

27,203

$

26,745

TAX EQUIVALENT YIELD ADJUSTMENT

$

4,082

$

3,795

$

3,727

$

3,743

$

3,673

Six Months Ended

June 30,

NONINTEREST INCOME

2013

2012

Trust fees

$

7,746

$

7,124

Service charges on deposits

8,211

7,924

ATM, interchange and credit card fees

7,910

7,460

Real estate mortgage fees

3,069

2,268

Net gain on sale of available-for-sale securities

255

728

Net gain (loss) on sale of foreclosed assets

(299)

(406)

Net gain (loss) on sale of assets

169

235

Other noninterest income

2,052

1,429

Total Noninterest Income

$

29,113

$

26,762

NONINTEREST EXPENSE

Salaries and employee benefits, excluding profit sharing

$

29,069

$

26,491

Profit sharing expense

2,262

1,927

Net occupancy expense

3,831

3,480

Equipment expense

4,661

4,252

FDIC Insurance premiums

1,141

1,093

ATM, interchange and credit card expenses

2,687

2,699

Legal, tax and professional fees

2,265

2,002

Audit  fees

685

578

Printing, stationery and supplies

970

1,015

Amortization of intangible assets

43

82

Advertising and public relations

2,094

1,894

Correspondent bank service charges

424

416

Other noninterest expense

7,250

7,284

Total Noninterest Expense

$

57,382

$

53,213

TAX EQUIVALENT YIELD ADJUSTMENT

$

7,877

$

7,167

 

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)

Three Months Ended

June 30, 2013

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

5,918

$

9

0.58

%

  Interest-bearing deposits in nonaffiliated banks

59,333

111

0.75

  Taxable securities

1,066,586

6,313

2.37

  Tax exempt securities

917,460

10,813

4.71

  Loans

2,324,268

29,282

5.05

Total interest-earning assets

4,373,565

46,528

4.27

Noninterest-earning assets

305,201

Total assets

$

4,678,766

Interest-bearing liabilities:

  Deposits

$

2,403,899

$

853

0.14

%

  Fed funds purchased and other short term borrowings

405,438

93

0.09

Total interest-bearing liabilities

2,809,337

946

0.14

Noninterest-bearing liabilities                                                                              

1,291,602

Shareholders' equity

577,827

Total liabilities and shareholders' equity

$

4,678,766

Net interest income and margin (tax equivalent)

$

45,582

4.18

%

Six Months Ended

June 30, 2013

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

9,570

$

14

0.30

%

  Interest-bearing deposits in nonaffiliated banks

91,830

281

0.62

  Taxable securities

1,052,723

12,688

2.41

  Tax exempt securities

871,459

20,886

4.79

  Loans

2,218,292

56,030

5.09

Total interest-earning assets

4,243,874

89,899

4.27

Noninterest-earning assets

302,071

Total assets

$

4,545,945

Interest-bearing liabilities:

  Deposits

$

2,362,645

$

1,721

0.15

%

  Fed funds purchased and other short term borrowings

338,549

130

0.08

Total interest-bearing liabilities

2,701,194

1,851

0.14

Noninterest-bearing liabilities                                                                              

1,274,970

Shareholders' equity

569,781

Total liabilities and shareholders' equity

$

4,545,945

Net interest income and margin (tax equivalent)

$

88,048

4.18

%

 

SOURCE First Financial Bankshares, Inc.



RELATED LINKS

http://www.ffin.com