First Financial Bankshares Announces Second Quarter Earnings Results

Jul 19, 2012, 16:05 ET from First Financial Bankshares, Inc.

ABILENE, Texas, July 19, 2012 /PRNewswire/ -- First Financial Bankshares, Inc. (NASDAQ: FFIN) today reported earnings for the second quarter of 2012 of $18.35 million, up 11.08 percent compared with earnings of $16.52 million in the same quarter last year.  Basic earnings per share were $0.58 for the second quarter of 2012 compared with $0.53 in the same quarter a year ago.

Net interest income increased 1.00 percent to $38.6 million compared with $38.2 million in 2011. The net interest margin, on a taxable equivalent basis, was 4.33 percent compared with 4.69 percent in the same quarter last year and 4.39 percent in the first quarter of this year. 

The provision for loan losses was $759 thousand in the second quarter of 2012, compared with $1.92 million in the same quarter last year and $1.30 million in the first quarter of this year. Nonperforming assets as a percentage of loans and foreclosed assets totaled 1.76 percent at June 30, 2012, compared with 1.60 percent at March 31, 2012, and 1.58 percent at June 30, 2011.  Classified loans totaled $80.9 million at June 30, 2012, compared to $90.4 million at March 31, 2012, and $91.7 million at June 30, 2011.

Noninterest income increased 13.20 percent in the second quarter of 2012 to $13.46 million compared with $11.89 million in the same quarter a year ago. Trust fees increased to $3.67 million in the second quarter of 2012 compared with $3.21 million in the same quarter last year, primarily due to continued growth in the fair value of Trust assets managed to $2.65 billion from $2.45 billion a year ago. ATM, interchange and credit card fees increased 10.81 percent to $3.78 million compared with $3.42 million in the same quarter last year.  Service charges on deposit accounts decreased to $4.04 million during the second quarter of 2012 compared with $4.52 million for the same quarter a year ago, due primarily to decreased customer use of overdraft services. 

Noninterest expense increased in the second quarter of 2012 to $26.75 million from $25.89 million in the same quarter last year. The Company's efficiency ratio in the second quarter of 2012 improved to 48.02 percent compared with 48.65 percent in the same quarter last year.

For the first half of 2012, net income increased 10.03 percent to $36.11 million from $32.82 million a year ago. Basic earnings per share rose to $1.15 in the first half of 2012 from $1.04 in the same period last year. Net interest income increased 1.74 percent to $76.81 million in the first half of 2012 from $75.50 million a year ago. The provision for loan losses totaled $2.06 million compared with $4.05 million in the first half of the previous year. Noninterest income was $26.76 million in the first half of 2012 compared with $24.74 million a year ago. Noninterest expense rose to $53.21 million in the first half of 2012 compared with $52.05 million last year.

As of June 30, 2012, consolidated assets for the Company totaled $4.29 billion compared with $3.84 billion a year ago. Loans grew 11.57 percent and totaled $1.92 billion at quarter end compared with loans of $1.72 billion a year ago. Total deposits were $3.39 billion as of June 30, 2012, which represents an 8.74 percent growth over $3.12 billion a year earlier.  Shareholders' equity rose to $534.26 million as of June 30, 2012, compared with $477.71 million the prior year. 

"We are pleased to report another successful quarter where we experienced solid growth in earnings, loans and trust fees," 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 11 separately chartered banks with 53 locations in Texas. The bank subsidiaries are First Financial Bank, N.A., Abilene, Albany, Clyde, Moran and Odessa; First Financial Bank, N.A., Eastland, Ranger, Cisco and Rising Star; First Financial Bank, N.A., Cleburne, Burleson, Alvarado, Midlothian and Crowley; First Financial Bank, Hereford; First Financial Bank, Huntsville; First Financial Bank, N.A., Mineral Wells; First Financial Bank, N.A., San Angelo; First Financial Bank, N.A., Southlake, Bridgeport, Boyd, Decatur, Grapevine, Keller and Trophy Club; First Financial Bank, N.A., Stephenville, Granbury, Glen Rose and Acton; First Financial Bank, N.A., Sweetwater, Roby, Trent and Merkel; and First Financial Bank, N.A., Weatherford, Willow Park, Aledo, Brock and Fort Worth. 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)

Quarter Ended

2012

2011

ASSETS:

June 30,

Mar. 31, 

Dec. 31,

Sept. 30, 

June 30,

Cash and due from banks

$

122,534

$

131,163

$

146,239

$

127,174

$

106,500

Interest-bearing deposits in banks

25,794

84,169

104,597

103,850

114,776

Interest-bearing time deposits in banks

74,594

62,018

61,175

66,688

78,312

Fed funds sold

10,100

11,200

-

3,580

3,195

Investment securities

1,963,367

1,963,341

1,844,998

1,732,919

1,646,655

Loans

1,918,292

1,798,867

1,786,544

1,728,832

1,719,415

Allowance for loan losses

(34,747)

(34,529)

(34,315)

(34,301)

(33,406)

Net loans

1,883,545

1,764,338

1,752,229

1,694,531

1,686,009

Premises and equipment

80,404

79,308

76,483

73,443

72,550

Goodwill

71,865

71,865

71,865

71,865

71,865

Other intangible assets

175

213

257

341

442

Other assets

59,426

59,635

62,688

61,012

60,711

Total assets

$

4,291,804

$

4,227,250

$

4,120,531

$

3,935,403

$

3,841,015

LIABILITIES AND SHAREHOLDERS'  EQUITY:

Noninterest-bearing deposits

$

1,156,238

$

1,125,577

$

1,101,576

$

1,020,953

$

989,271

Interest-bearing deposits

2,235,942

2,272,495

2,233,222

2,165,653

2,130,170

Total deposits

3,392,180

3,398,072

3,334,798

3,186,606

3,119,441

Short-term borrowings

251,428

237,567

207,756

180,790

192,364

Other liabilities

113,933

74,606

69,440

68,808

51,505

Shareholders' equity

534,263

517,005

508,537

499,199

477,705

Total liabilities and shareholders' equity

$

4,291,804

$

4,227,250

$

4,120,531

$

3,935,403

$

3,841,015

Quarter Ended

2012

2011

INCOME STATEMENTS

June 30,

Mar. 31, 

Dec. 31,

Sept. 30, 

June 30,

Interest income

$

39,911

$

39,797

$

39,888

$

40,164

$

40,241

Interest expense

1,355

1,540

1,704

1,854

2,065

Net interest income

38,556

38,257

38,184

38,310

38,176

Provision for loan losses

759

1,296

1,221

1,354

1,924

Net interest income after provision for loan losses

37,797

36,961

36,963

36,956

36,252

Noninterest income

13,464

13,298

12,792

13,911

11,894

Noninterest expense

26,745

26,468

26,257

26,320

25,888

Net income before income taxes

24,516

23,791

23,498

24,547

22,258

Income tax expense

6,165

6,035

6,032

6,460

5,738

Net income

$

18,351

$

17,756

$

17,466

$

18,087

$

16,520

PER COMMON SHARE DATA 

Net income - basic

$

0.58

$

0.56

$

0.56

$

0.58

$

0.53

Net income - diluted

0.58

0.56

0.55

0.57

0.52

Cash dividends 

0.25

0.24

0.24

0.24

0.24

Shares outstanding - end of period

31,481,747

31,477,483

31,459,635

31,452,283

31,451,300

Average outstanding shares - basic

31,478,980

31,466,706

31,454,197

31,451,687

31,442,978

Average outstanding shares - diluted

31,497,241

31,479,743

31,489,304

31,481,092

31,467,617

PERFORMANCE RATIOS

Return on average assets

1.75

%

1.73

%

1.74

%

1.87

%

1.74

%

Return on average equity

14.01

13.79

13.88

14.79

14.29

Net interest margin (tax equivalent)

4.33

4.39

4.44

4.62

4.69

Efficiency ratio

48.02

48.08

48.33

47.48

48.65

Six Months Ended

June 30,

INCOME STATEMENTS

2012

2011

Interest income

$

79,708

$

79,968

Interest expense

2,895

4,466

Net interest income

76,813

75,502

Provision for loan losses

2,055

4,051

Net interest income after provision for loan losses

74,758

71,451

Noninterest income

26,762

24,736

Noninterest expense

53,213

52,048

Net income before income taxes

48,307

44,139

Income tax expense

12,200

11,324

Net income

$

36,107

$

32,815

PER COMMON SHARE DATA 

Net income - basic

$

1.15

$

1.04

Net income - diluted

1.15

1.04

Cash dividends 

0.49

0.47

Book Value

16.97

15.19

Market Value

34.56

34.45

Shares outstanding - end of period

31,481,747

31,451,300

Average outstanding shares - basic

31,472,843

31,434,328

Average outstanding shares - diluted

31,474,653

31,457,286

PERFORMANCE RATIOS

Return on average assets

1.74

%

1.75

%

Return on average equity

13.90

14.57

Net interest margin (tax equivalent)

4.36

4.71

Efficiency ratio

48.05

48.86

 

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)

Quarter Ended

2012

2011

ALLOWANCE FOR LOAN LOSSES

June 30,

Mar. 31, 

Dec. 31,

Sept. 30, 

June 30,

Balance at beginning of period

$

34,529

$

34,315

$

34,301

$

33,406

$

32,501

Loans charged off

(766)

(1,405)

(2,195)

(722)

(1,396)

Loan recoveries

225

323

988

263

377

Net charge-offs

(541)

(1,082)

(1,207)

(459)

(1,019)

Provision for loan losses

759

1,296

1,221

1,354

1,924

Balance at end of period

$

34,747

$

34,529

$

34,315

$

34,301

$

33,406

Allowance for loan losses /

     period-end loans

1.81

%

1.92

%

1.92

%

1.98

%

1.94

%

Allowance for loan losses /

     nonperforming loans

130.1

164.3

171.0

194.3

179.6

Net charge-offs / average loans

     (annualized)

0.12

0.24

0.27

0.11

0.24

NONPERFORMING ASSETS

Nonaccrual loans

$

26,606

$

20,963

$

19,975

$

17,598

$

18,599

Accruing loans 90 days past due

105

53

96

52

6

Total nonperforming loans

26,711

21,016

20,071

17,650

18,605

Foreclosed assets

7,149

7,852

9,464

10,254

8,778

Total nonperforming assets

$

33,860

$

28,868

$

29,535

$

27,904

$

27,383

As a % of loans and foreclosed assets

1.76

%

1.60

%

1.64

%

1.60

%

1.58

%

As a % of end of period total assets

0.79

0.68

0.72

0.71

0.71

CAPITAL RATIOS

Tier 1 Risk-based

17.23

%

17.73

%

17.49

%

17.89

%

17.97

%

Total Risk-based

18.48

18.99

18.74

19.14

19.22

Tier 1 Leverage

10.36

10.31

10.33

10.45

10.22

Equity to assets

12.45

12.23

12.34

12.68

12.44

Quarter Ended

2012

2011

NONINTEREST INCOME

June 30,

Mar. 31, 

Dec. 31,

Sept. 30, 

June 30,

Trust fees

$

3,670

$

3,454

$

3,151

$

3,265

$

3,211

Service charges on deposits

4,042

3,882

4,313

4,482

4,520

ATM, interchange and credit card fees

3,784

3,676

3,551

3,544

3,415

Real estate mortgage fees

1,218

1,050

1,013

1,056

941

Net gain on sale of available-for-sale securities

382

346

164

67

42

Net gain (loss) on sale of foreclosed assets

(404)

6

(159)

18

(1,111)

Net gain (loss) on sale of assets

105

122

43

588

123

Other noninterest income

667

762

716

891

753

Total Noninterest Income

$

13,464

$

13,298

$

12,792

$

13,911

$

11,894

NONINTEREST EXPENSE

Salaries and employee benefits, excluding profit sharing

$

13,304

$

13,186

$

12,753

$

12,790

$

12,916

Profit sharing expense

885

1,043

1,153

1,318

1,092

Net occupancy expense

1,743

1,737

1,707

1,823

1,685

Equipment expense

2,144

2,108

2,008

1,970

1,951

FDIC Insurance premiums

565

527

517

561

597

ATM, interchange and credit card expenses

1,450

1,249

1,311

1,276

1,183

Legal, tax and professional fees

968

1,033

994

947

1,077

Audit  fees

283

295

304

305

276

Printing, stationery and supplies

511

505

473

443

489

Amortization of intangible assets

38

44

84

101

105

Advertising and public relations

953

942

1,105

1,033

870

Correspondent bank service charges

216

200

198

198

208

Other noninterest expense

3,685

3,599

3,650

3,555

3,439

Total Noninterest Expense

$

26,745

$

26,468

$

26,257

$

26,320

$

25,888

TAX EQUIVALENT YIELD ADJUSTMENT

$

3,673

$

3,495

$

3,348

$

3,209

$

3,145

Six Months Ended

June 30,

NONINTEREST INCOME

2012

2011

Trust fees

$

7,124

$

6,254

Service charges on deposits

7,924

8,894

ATM, interchange and credit card fees

7,460

6,491

Real estate mortgage fees

2,268

1,874

Net gain on sale of available-for-sale securities

728

261

Net gain (loss) on sale of foreclosed assets

(406)

(1,174)

Net gain (loss) on sale of assets

235

266

Other noninterest income

1,429

1,870

Total Noninterest Income

$

26,762

$

24,736

NONINTEREST EXPENSE

Salaries and employee benefits, excluding profit sharing

$

26,491

$

26,027

Profit sharing expense

1,927

2,216

Net occupancy expense

3,480

3,332

Equipment expense

4,252

3,822

FDIC Insurance premiums

1,093

1,568

ATM, interchange and credit card expenses

2,699

2,330

Legal, tax and professional fees

2,002

2,328

Audit  fees

578

549

Printing, stationery and supplies

1,015

916

Amortization of intangible assets

82

216

Advertising and public relations

1,894

1,678

Correspondent bank service charges

416

408

Other noninterest expense

7,284

6,658

Total Noninterest Expense

$

53,213

$

52,048

TAX EQUIVALENT YIELD ADJUSTMENT

$

7,167

$

6,294

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)

Three Months Ended

June 30, 2012

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

6,671

$

6

0.35

%

  Interest-bearing deposits in nonaffiliated banks

128,473

221

0.69

%

  Taxable securities

1,185,081

8,214

2.77

%

  Tax exempt securities

755,511

9,862

5.22

%

  Loans

1,850,408

25,281

5.49

%

Total interest-earning assets

3,926,144

43,584

4.46

%

Noninterest-earning assets

281,042

Total assets

$

4,207,186

Interest-bearing liabilities:

  Deposits

$

2,260,319

$

1,310

0.23

%

  Fed funds purchased and other short term borrowings

239,599

45

0.08

%

Total interest-bearing liabilities

2,499,918

1,355

0.22

%

Noninterest-bearing liabilities                                                                              

1,180,367

Shareholders' equity

526,901

Total liabilities and shareholders' equity

$

4,207,186

Net interest income and margin (tax equivalent)

$

42,229

4.33

%

Six Months Ended

June 30, 2012

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

5,148

$

8

0.32

%

  Interest-bearing deposits in nonaffiliated banks

130,753

430

0.66

%

  Taxable securities

1,200,932

17,018

2.83

%

  Tax exempt securities

723,294

19,237

5.32

%

  Loans

1,817,300

50,182

5.55

%

Total interest-earning assets

3,877,427

86,875

4.51

%

Noninterest-earning assets

286,204

Total assets

$

4,163,631

Interest-bearing liabilities:

  Deposits

$

2,256,399

$

2,793

0.25

%

  Fed funds purchased and other short term borrowings

240,672

102

0.09

%

Total interest-bearing liabilities

2,497,071

2,895

0.23

%

Noninterest-bearing liabilities                                                                              

1,144,268

Shareholders' equity

522,292

Total liabilities and shareholders' equity

$

4,163,631