First Financial Bankshares Announces Third Quarter Earnings Results

Oct 18, 2012, 16:00 ET from First Financial Bankshares, Inc.

ABILENE, Texas, Oct. 18, 2012 /PRNewswire/ -- First Financial Bankshares, Inc. (NASDAQ: FFIN) today reported earnings for the third quarter of 2012 of $19.80 million, up 9.47 percent compared with earnings of $18.09 million in the same quarter last year.  Basic earnings per share were $0.63 for the third quarter of 2012 compared with $0.58 in the same quarter a year ago.

Net interest income increased 2.11 percent to $39.12 million compared with $38.31 million in 2011. The net interest margin, on a taxable equivalent basis, was 4.26 percent compared with 4.62 percent in the same quarter last year and 4.33 percent in the second quarter of this year. 

The provision for loan losses was $787 thousand in the third quarter of 2012, compared with $1.35 million in the same quarter last year and $759 thousand in the second quarter of this year. Nonperforming assets as a percentage of loans and foreclosed assets totaled 1.53 percent at September 30, 2012, compared with 1.76 percent at June 30, 2012, and 1.60 percent at September 30, 2011.  Classified loans totaled $76.48 million at September 30, 2012, compared to $80.86 million at June 30, 2012, and $82.99 million at September 30, 2011.

Noninterest income increased 11.42 percent in the third quarter of 2012 to $15.50 million compared with $13.91 million in the same quarter a year ago. Trust fees increased to $3.72 million in the third quarter of 2012 compared with $3.27 million in the same quarter last year, primarily due to continued growth in the fair value of Trust assets managed to $2.75 billion from $2.30 billion a year ago. ATM, interchange and credit card fees increased 6.29 percent to $3.77 million compared with $3.54 million in the same quarter last year.  Service charges on deposit accounts decreased to $4.34 million during the third quarter of 2012 compared with $4.48 million for the same quarter a year ago, due primarily to decreased customer use of overdraft services. The net gain on securities sold during the third quarter of 2012 totaled $1.48 million compared to $67 thousand in the same quarter of 2011.

Noninterest expense increased in the third quarter of 2012 to $27.20 million from $26.32 million in the same quarter last year. The Company's efficiency ratio in the third quarter of 2012 improved to 46.61 percent compared with 47.48 percent in the same quarter last year.

For the first nine months of 2012, net income increased 9.83 percent to $55.91 million from $50.90 million for the same period a year ago. Basic earnings per share rose to $1.78 in the first nine months of 2012 from $1.62 in the same period last year. Net interest income increased 1.86 percent to $115.93 million in the first nine months of 2012 from $113.81 million a year ago. The provision for loan losses totaled $2.84 million compared with $5.41 million in the first nine months of the previous year. Noninterest income was $42.26 million in the first nine months of 2012 compared with $38.65 million for the same period a year ago. Noninterest expense rose to $80.42 million in the first nine months of 2012 compared with $78.37 million last year.

As of September 30, 2012, consolidated assets for the Company totaled $4.31 billion compared with $3.94 billion a year ago. Loans grew 15.91 percent and totaled $2.00 billion at quarter end compared with loans of $1.73 billion a year ago. Total deposits were $3.44 billion as of September 30, 2012, which represents an 8.09 percent growth over $3.19 billion a year earlier.  Shareholders' equity rose to $549.91 million as of September 30, 2012, compared with $499.20 million the prior year. 

"This was another good quarter for our company," said F. Scott Dueser, Chairman, President and CEO. "We continue to see good growth in loans and deposits and continue to pursue acquisition prospects to put our capital to use."

Additionally, the Company announced today that it will consolidate its eleven charters into one charter, effective at the end of the 2012 fiscal year, subject to regulatory approval. "Due to regulatory, compliance and technology complexities and the opportunity for additional cost savings, we believe it is time to make this enhancement," stated Scott Dueser. "Outside of consolidating the eleven databases, our banks will continue to operate as they do today with local management and board decisions to benefit the customers and communities we serve," added Dueser.

About First Financial Bankshares

Headquartered in Abilene, Texas, First Financial Bankshares is a financial holding company that operates 11 separately chartered banks with 54 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:

Sept. 30, 

June 30,

Mar. 31, 

Dec. 31,

Sept. 30, 

Cash and due from banks

$

128,606

$

122,534

$

131,163

$

146,239

$

127,174

Interest-bearing deposits in banks

25,633

25,794

84,169

104,597

103,850

Interest-bearing time deposits in banks

67,506

74,594

62,018

61,175

66,688

Fed funds sold

23,400

10,100

11,200

-

3,580

Investment securities

1,883,864

1,963,367

1,963,341

1,844,998

1,732,919

Loans

2,003,854

1,918,292

1,798,867

1,786,544

1,728,832

Allowance for loan losses

(34,932)

(34,747)

(34,529)

(34,315)

(34,301)

Net loans

1,968,922

1,883,545

1,764,338

1,752,229

1,694,531

Premises and equipment

80,580

80,404

79,308

76,483

73,443

Goodwill

71,865

71,865

71,865

71,865

71,865

Other intangible assets

136

175

213

257

341

Other assets

60,035

59,426

59,635

62,688

61,012

Total assets

$

4,310,547

$

4,291,804

$

4,227,250

$

4,120,531

$

3,935,403

LIABILITIES AND SHAREHOLDERS'  EQUITY:

Noninterest-bearing deposits

$

1,200,154

$

1,156,238

$

1,125,577

$

1,101,576

$

1,020,953

Interest-bearing deposits

2,244,244

2,235,942

2,272,495

2,233,222

2,165,653

Total deposits

3,444,398

3,392,180

3,398,072

3,334,798

3,186,606

Short-term borrowings

254,480

251,428

237,567

207,756

180,790

Other liabilities

61,757

113,933

74,606

69,440

68,808

Shareholders' equity

549,912

534,263

517,005

508,537

499,199

Total liabilities and shareholders' equity

$

4,310,547

$

4,291,804

$

4,227,250

$

4,120,531

$

3,935,403

Quarter Ended

2012

2011

INCOME STATEMENTS

Sept. 30, 

June 30,

Mar. 31, 

Dec. 31,

Sept. 30, 

Interest income

$

40,287

$

39,911

$

39,797

$

39,888

$

40,164

Interest expense

1,168

1,355

1,540

1,704

1,854

Net interest income

39,119

38,556

38,257

38,184

38,310

Provision for loan losses

787

759

1,296

1,221

1,354

Net interest income after provision for loan losses

38,332

37,797

36,961

36,963

36,956

Noninterest income

15,499

13,464

13,298

12,792

13,911

Noninterest expense

27,203

26,745

26,468

26,257

26,320

Net income before income taxes

26,628

24,516

23,791

23,498

24,547

Income tax expense

6,828

6,165

6,035

6,032

6,460

Net income

$

19,800

$

18,351

$

17,756

$

17,466

$

18,087

PER COMMON SHARE DATA 

Net income - basic

$

0.63

$

0.58

$

0.56

$

0.56

$

0.58

Net income - diluted

0.63

0.58

0.56

0.55

0.57

Cash dividends 

0.25

0.25

0.24

0.24

0.24

Shares outstanding - end of period

31,488,530

31,481,747

31,477,483

31,459,635

31,452,283

Average outstanding shares - basic

31,484,375

31,478,980

31,466,706

31,454,197

31,451,687

Average outstanding shares - diluted

31,502,172

31,497,241

31,479,743

31,489,304

31,481,092

PERFORMANCE RATIOS

Return on average assets

1.84

%

1.75

%

1.73

%

1.74

%

1.87

%

Return on average equity

14.53

14.01

13.79

13.88

14.79

Net interest margin (tax equivalent)

4.26

4.33

4.39

4.44

4.62

Efficiency ratio

46.61

48.02

48.08

48.33

47.48

Nine Months Ended

Sept. 30,

INCOME STATEMENTS

2012

2011

Interest income

$

119,994

$

120,132

Interest expense

4,063

6,320

Net interest income

115,931

113,812

Provision for loan losses

2,842

5,405

Net interest income after provision for loan losses

113,089

108,407

Noninterest income

42,261

38,646

Noninterest expense

80,415

78,367

Net income before income taxes

74,935

68,686

Income tax expense

19,028

17,784

Net income

$

55,907

$

50,902

PER COMMON SHARE DATA 

Net income - basic

$

1.78

$

1.62

Net income - diluted

1.78

1.62

Cash dividends 

0.74

0.71

Book value

17.46

15.87

Market value

36.03

26.16

Shares outstanding - end of period

31,488,530

31,452,283

Average outstanding shares - basic

31,476,715

31,440,178

Average outstanding shares - diluted

31,486,707

31,488,129

PERFORMANCE RATIOS

Return on average assets

1.78

%

1.79

%

Return on average equity

14.12

14.65

Net interest margin (tax equivalent)

4.32

4.68

Efficiency ratio

47.55

48.39

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)

Quarter Ended

2012

2011

ALLOWANCE FOR LOAN LOSSES

Sept. 30,

June 30,

Mar. 31, 

Dec. 31,

Sept. 30, 

Balance at beginning of period

$

34,747

$

34,529

$

34,315

$

34,301

$

33,406

Loans charged off

(1,064)

(766)

(1,405)

(2,195)

(722)

Loan recoveries

462

225

323

988

263

Net charge-offs

(602)

(541)

(1,082)

(1,207)

(459)

Provision for loan losses

787

759

1,296

1,221

1,354

Balance at end of period

$

34,932

$

34,747

$

34,529

$

34,315

$

34,301

Allowance for loan losses /

     period-end loans

1.74

%

1.81

%

1.92

%

1.92

%

1.98

%

Allowance for loan losses /

     nonperforming loans

143.4

130.1

164.3

171.0

194.3

Net charge-offs / average loans

     (annualized)

0.12

0.12

0.24

0.27

0.11

NONPERFORMING ASSETS

Nonaccrual loans

$

24,283

$

26,606

$

20,963

$

19,975

$

17,598

Accruing loans 90 days past due

69

105

53

96

52

Total nonperforming loans

24,352

26,711

21,016

20,071

17,650

Foreclosed assets

6,373

7,149

7,852

9,464

10,254

Total nonperforming assets

$

30,725

$

33,860

$

28,868

$

29,535

$

27,904

As a % of loans and foreclosed assets

1.53

%

1.76

%

1.60

%

1.64

%

1.60

%

As a % of end of period total assets

0.71

0.79

0.68

0.72

0.71

CAPITAL RATIOS

Tier 1 risk-based

17.66

%

17.23

%

17.73

%

17.49

%

17.89

%

Total risk-based

18.92

18.48

18.99

18.74

19.14

Tier 1 leverage

10.49

10.36

10.31

10.33

10.45

Equity to assets

12.76

12.45

12.23

12.34

12.68

Quarter Ended

2012

2011

NONINTEREST INCOME

Sept. 30,

June 30,

Mar. 31, 

Dec. 31,

Sept. 30, 

Trust fees

$

3,723

$

3,670

$

3,454

$

3,151

$

3,265

Service charges on deposits

4,337

4,042

3,882

4,313

4,482

ATM, interchange and credit card fees

3,767

3,784

3,676

3,551

3,544

Real estate mortgage fees

1,495

1,218

1,050

1,013

1,056

Net gain on sale of available-for-sale securities

1,479

382

346

164

67

Net gain (loss) on sale of foreclosed assets

(106)

(404)

6

(159)

18

Net gain (loss) on sale of assets

(32)

105

122

43

588

Other noninterest income

836

667

762

716

891

Total noninterest income

$

15,499

$

13,464

$

13,298

$

12,792

$

13,911

NONINTEREST EXPENSE

Salaries and employee benefits, excluding profit sharing

$

13,502

$

13,304

$

13,186

$

12,753

$

12,790

Profit sharing expense

1,343

885

1,043

1,153

1,318

Net occupancy expense

1,806

1,743

1,737

1,707

1,823

Equipment expense

2,269

2,144

2,108

2,008

1,970

FDIC insurance premiums

563

565

527

517

561

ATM, interchange and credit card expenses

1,317

1,450

1,249

1,311

1,276

Legal, tax and professional fees

1,019

968

1,033

994

947

Audit  fees

311

283

295

304

305

Printing, stationery and supplies

468

511

505

473

443

Amortization of intangible assets

38

38

44

84

101

Advertising and public relations

998

953

942

1,105

1,033

Correspondent bank service charges

220

216

200

198

198

Other noninterest expense

3,349

3,685

3,599

3,650

3,555

Total noninterest expense

$

27,203

$

26,745

$

26,468

$

26,257

$

26,320

TAX EQUIVALENT YIELD ADJUSTMENT

$

3,743

$

3,673

$

3,495

$

3,348

$

3,209

Nine Months Ended

Sept. 30,

NONINTEREST INCOME

2012

2011

Trust fees

$

10,848

$

9,520

Service charges on deposits

12,261

13,376

ATM, interchange and credit card fees

11,226

10,036

Real estate mortgage fees

3,763

2,930

Net gain on sale of available-for-sale securities

2,206

328

Net gain (loss) on sale of foreclosed assets

(512)

(1,156)

Net gain (loss) on sale of assets

203

854

Other noninterest income

2,266

2,758

Total noninterest income

$

42,261

$

38,646

NONINTEREST EXPENSE

Salaries and employee benefits, excluding profit sharing

$

39,993

$

38,816

Profit sharing expense

3,270

3,535

Net occupancy expense

5,286

5,154

Equipment expense

6,521

5,792

FDIC insurance premiums

1,655

2,129

ATM, interchange and credit card expenses

4,017

3,607

Legal, tax and professional fees

3,020

3,217

Audit  fees

889

855

Printing, stationery and supplies

1,483

1,359

Amortization of intangible assets

120

317

Advertising and public relations

2,893

2,711

Correspondent bank service charges

636

606

Other noninterest expense

10,632

10,269

Total noninterest expense

$

80,415

$

78,367

TAX EQUIVALENT YIELD ADJUSTMENT

$

10,911

$

9,503

 

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)

Three Months Ended

Sept. 30, 2012

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

23,924

$

1

0.01

%

  Interest-bearing deposits in nonaffiliated banks

96,878

185

0.76

%

  Taxable securities

1,121,465

7,480

2.67

%

  Tax exempt securities

795,727

9,912

4.98

%

  Loans

1,967,789

26,452

5.35

%

Total interest-earning assets

4,005,783

44,030

4.37

%

Noninterest-earning assets

274,379

Total assets

$

4,280,162

Interest-bearing liabilities:

  Deposits

$

2,240,977

$

1,094

0.19

%

  Fed funds purchased and other short term

  borrowings

289,568

74

0.10

%

Total interest-bearing liabilities

2,530,545

1,168

0.18

%

Noninterest-bearing liabilities

1,207,352

Shareholders' equity

542,265

Total liabilities and shareholders' equity

$

4,280,162

Net interest income and margin (tax equivalent)

$

42,862

4.26

%

Nine Months Ended

Sept. 30, 2012

Average

Tax Equivalent

Yield /

Balance

Interest

Rate

Interest-earning assets:

  Fed funds sold

$

11,453

$

9

0.10

%

  Interest-bearing deposits in nonaffiliated banks

119,379

615

0.69

%

  Taxable securities

1,174,249

24,498

2.78

%

  Tax exempt securities

747,614

29,150

5.20

%

  Loans

1,867,829

76,633

5.48

%

Total interest-earning assets

3,920,524

130,905

4.46

%

Noninterest-earning assets

282,235

Total assets

$

4,202,759

Interest-bearing liabilities:

  Deposits

$

2,251,221

$

3,887

0.23

%

  Fed funds purchased and other short term

  borrowings

257,090

176

0.09

%

Total interest-bearing liabilities

2,508,311

4,063

0.22

%

Noninterest-bearing liabilities

1,165,450

Shareholders' equity

528,998

Total liabilities and shareholders' equity

$

4,202,759

Net interest income and margin (tax equivalent)

$

126,842

4.32

%

    

SOURCE First Financial Bankshares, Inc.



RELATED LINKS

http://www.ffin.com