BANCFIRST CORPORATION REPORTS FIRST QUARTER EARNINGS
OKLAHOMA CITY, April 25, 2023 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS:BANF) reported net income of $57.5 million, or $1.72 diluted earnings per share, for the first quarter of 2023 compared to net income of $35.9 million, or $1.08 diluted earnings per share, for the first quarter of 2022. The Company's net interest income for the first quarter of 2023 increased to $109.2 million compared to $75.5 million for the quarter ended March 31, 2022. Rising short-term interest rates and loan growth drove the increase. The net interest margin for the quarter was 3.89% compared to 2.78% a year ago. For the first quarter of 2023, the Company recorded a provision for credit losses of $2.3 million, compared to $2.9 million for the first quarter of 2022.
Noninterest income for the quarter totaled $47.8 million, compared to $43.7 million last year. The increase in noninterest income was mostly attributable to an increase in sweep fees due to rising interest rates and higher volume, along with a $1.3 million increase in insurance commissions. Noninterest income for the first quarter included $327,000 of income from an equity interest received from a prior loan settlement compared to $4.9 million of income from the same source in the first quarter of 2022. In addition, the first quarter of 2022 included a loss of $4.0 million on the sale of $226 million of low yielding securities, which were subsequently reinvested at higher yields.
Noninterest expense for the quarter increased to $80.3 million compared to $72.5 million last year. The increase in noninterest expense was primarily related to an increase in salaries and employee benefits of $5.3 million. The first quarter of 2022 included a gain on sale of OREO which reduced noninterest expense by $726,000.
The Company's effective tax rate for the period was 22.6% compared to 17.8% for the first quarter of 2022. During the quarter, the Company adopted ASU 2023-02 which required a reclassification of $977,000 from other expense to income tax expense. The lower effective tax rate in 2022 was also driven by the exercising of stock options during the quarter and a lower state income tax rate.
At March 31, 2023, the Company's total assets were $12.3 billion, a decrease of $55.8 million from December 31, 2022. Debt securities of $1.6 billion were up $77.6 million from December 31, 2022. Loans totaled $7.1 billion, an increase of $175.0 million from December 31, 2022. Deposits totaled $10.6 billion, a decrease of $364.1 million from December 31, 2022 as deposits moved into the Company's off balance sheet sweep product. Sweep accounts were $4.1 billion at March 31, 2023 up $394.9 million from December 31, 2022. The Company's total stockholders' equity was $1.3 billion, an increase of $60.0 million over December 31, 2022.
Asset quality remained strong as nonaccrual loans totaled $17.6 million, representing only 0.25% of total loans at March 31, 2023 compared to 0.22% at year-end 2022. The allowance for credit losses to total loans was 1.33% at both March 31, 2023 and December 31, 2022. Net charge-offs were minimal for both the first quarter of 2023 and 2022.
BancFirst Corporation CEO David Harlow commented, "While we were pleased with our first quarter results, our industry is facing growing challenges including the possibility of a recession. However, we feel the Company is as well positioned to navigate these headwinds as any bank in the country. Top-tier liquidity supported by community based deposits, strong capital, and solid credit quality will allow us to continue to do what we have always done – focus on and support our customers and the communities that we serve."
BancFirst Corporation (the Company) is an Oklahoma based financial services holding company. The Company operates three subsidiary banks, BancFirst, an Oklahoma state-chartered bank with 106 banking locations serving 59 communities across Oklahoma, Pegasus Bank, with 3 banking locations in the Dallas Metroplex area and Worthington Bank with 4 locations in the Dallas-Fort Worth Metroplex area. 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) | ||||||||||
2023 | 2022 | 2022 | 2022 | 2022 | ||||||
1st Qtr | 4th Qtr | 3rd Qtr | 2nd Qtr | 1st Qtr | ||||||
Condensed Income Statements: | ||||||||||
Net interest income | $ 109,156 | $ 110,352 | $ 100,947 | $ 86,867 | $ 75,507 | |||||
Provision for credit losses | 2,322 | 3,776 | 2,863 | 501 | 2,936 | |||||
Noninterest income: | ||||||||||
Trust revenue | 4,222 | 4,065 | 4,125 | 3,949 | 3,506 | |||||
Service charges on deposits | 21,231 | 21,603 | 22,161 | 21,618 | 21,375 | |||||
Securities transactions | (213) | 1,116 | 966 | - | (3,915) | |||||
Income from sales of loans | 604 | 657 | 969 | 1,256 | 1,666 | |||||
Insurance commissions | 8,741 | 6,656 | 7,498 | 5,302 | 7,427 | |||||
Cash management | 6,734 | 6,124 | 5,624 | 4,447 | 3,131 | |||||
Other | 6,509 | 7,947 | 7,988 | 6,026 | 10,460 | |||||
Total noninterest income | 47,828 | 48,168 | 49,331 | 42,598 | 43,650 | |||||
Noninterest expense: | ||||||||||
Salaries and employee benefits | 49,252 | 48,019 | 47,741 | 45,284 | 43,932 | |||||
Occupancy expense, net | 4,983 | 5,259 | 4,930 | 4,734 | 4,403 | |||||
Depreciation | 4,643 | 4,566 | 4,612 | 4,647 | 4,775 | |||||
Amortization of intangible assets | 880 | 880 | 880 | 857 | 831 | |||||
Data processing services | 2,107 | 1,928 | 1,876 | 1,975 | 1,805 | |||||
Net expense (income) from other real estate owned | 2,459 | 6,235 | 2,392 | (510) | 1,794 | |||||
Marketing and business promotion | 2,527 | 2,465 | 1,945 | 1,591 | 2,073 | |||||
Deposit insurance | 1,613 | 1,209 | 1,202 | 1,196 | 1,128 | |||||
Other | 11,853 | 14,044 | 13,500 | 13,943 | 11,771 | |||||
Total noninterest expense | 80,317 | 84,605 | 79,078 | 73,717 | 72,512 | |||||
Income before income taxes | 74,345 | 70,139 | 68,337 | 55,247 | 43,709 | |||||
Income tax expense | 16,812 | 13,013 | 12,985 | 10,540 | 7,794 | |||||
Net income | $ 57,533 | $ 57,126 | $ 55,352 | $ 44,707 | $ 35,915 | |||||
Per Common Share Data: | ||||||||||
Net income-basic | $ 1.75 | $ 1.74 | $ 1.69 | $ 1.36 | $ 1.10 | |||||
Net income-diluted | 1.72 | 1.70 | 1.65 | 1.34 | 1.08 | |||||
Cash dividends declared | 0.40 | 0.40 | 0.40 | 0.36 | 0.36 | |||||
Common shares outstanding | 32,899,493 | 32,875,560 | 32,856,387 | 32,781,198 | 32,725,587 | |||||
Average common shares outstanding - | ||||||||||
Basic | 32,892,857 | 32,868,087 | 32,825,931 | 32,749,752 | 32,666,916 | |||||
Diluted | 33,462,379 | 33,503,937 | 33,536,558 | 33,418,482 | 33,315,333 | |||||
Performance Ratios: | ||||||||||
Return on average assets | 1.90 % | 1.82 % | 1.75 % | 1.42 % | 1.22 % | |||||
Return on average stockholders' equity | 18.31 | 18.62 | 18.13 | 15.14 | 12.33 | |||||
Net interest margin | 3.89 | 3.83 | 3.48 | 3.05 | 2.78 | |||||
Efficiency ratio | 51.16 | 53.37 | 52.62 | 56.94 | 60.85 | |||||
BancFirst Corporation | |||||||||||
Summary Financial Information | |||||||||||
(Dollars in thousands, except per share and share data - Unaudited) | |||||||||||
2023 | 2022 | 2022 | 2022 | 2022 | |||||||
1st Qtr | 4th Qtr | 3rd Qtr | 2nd Qtr | 1st Qtr | |||||||
Balance Sheet Data: | |||||||||||
Total assets | $ 12,332,105 | $ 12,387,863 | $ 12,452,378 | $ 12,530,073 | $ 12,624,431 | ||||||
Interest-bearing deposits with banks | 2,623,565 | 2,909,861 | 3,106,279 | 3,590,311 | 3,816,532 | ||||||
Debt securities | 1,618,233 | 1,540,604 | 1,521,645 | 1,205,894 | 1,211,668 | ||||||
Total loans | 7,124,831 | 6,949,795 | 6,832,595 | 6,620,643 | 6,504,477 | ||||||
Allowance for credit losses | (94,760) | (92,728) | (89,871) | (86,935) | (87,239) | ||||||
Deposits | 10,610,103 | 10,974,228 | 11,058,940 | 11,142,688 | 11,250,971 | ||||||
Stockholders' equity | 1,310,882 | 1,250,836 | 1,195,149 | 1,185,695 | 1,167,802 | ||||||
Book value per common share | 39.85 | 38.05 | 36.37 | 36.17 | 35.68 | ||||||
Tangible book value per common share (non-GAAP)(1) | 33.73 | 31.90 | 30.20 | 29.90 | 29.51 | ||||||
Balance Sheet Ratios: | |||||||||||
Average loans to deposits | 64.54 % | 62.25 % | 59.62 % | 58.66 % | 59.72 % | ||||||
Average earning assets to total assets | 92.52 | 92.14 | 91.58 | 90.89 | 91.92 | ||||||
Average stockholders' equity to average assets | 10.36 | 9.80 | 9.63 | 9.40 | 9.86 | ||||||
Asset Quality Data: | |||||||||||
Past due loans | $ 7,258 | $ 7,085 | $ 3,167 | $ 4,771 | $ 6,360 | ||||||
Nonaccrual loans (3) | 17,649 | 15,299 | 11,962 | 13,712 | 17,453 | ||||||
Other real estate owned and repossessed assets | 38,874 | 36,936 | 39,419 | 39,209 | 39,729 | ||||||
Nonaccrual loans to total loans | 0.25 % | 0.22 % | 0.18 % | 0.21 % | 0.27 % | ||||||
Allowance to total loans | 1.33 | 1.33 | 1.32 | 1.31 | 1.34 | ||||||
Allowance to nonaccrual loans | 536.93 | 606.10 | 751.32 | 634.01 | 499.83 | ||||||
Net charge-offs to average loans | 0.00 | 0.01 | 0.00 | 0.01 | 0.00 | ||||||
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(2): | |||||||||||
Stockholders' equity | $ 1,310,882 | $ 1,250,836 | $ 1,195,149 | $ 1,185,695 | $ 1,167,802 | ||||||
Less goodwill | 182,055 | 182,055 | 182,055 | 183,639 | 176,563 | ||||||
Less intangible assets, net | 19,103 | 19,983 | 20,863 | 21,743 | 25,456 | ||||||
Tangible stockholders' equity (non-GAAP) | $ 1,109,724 | $ 1,048,798 | $ 992,231 | $ 980,313 | $ 965,783 | ||||||
Common shares outstanding | 32,899,493 | 32,875,560 | 32,856,387 | 32,781,198 | 32,725,587 | ||||||
Tangible book value per common share (non-GAAP) | $ 33.73 | $ 31.90 | $ 30.20 | $ 29.90 | $ 29.51 | ||||||
(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. | |||||||||||
(3) Government Agencies guarantee approximately $6.4 million of nonaccrual loans at March 31, 2023. | |||||||||||
BancFirst Corporation | |||||||
Consolidated Average Balance Sheets | |||||||
And Interest Margin Analysis | |||||||
Taxable Equivalent Basis | |||||||
(Dollars in thousands - Unaudited) | |||||||
Three Months Ended | |||||||
March 31, 2023 | |||||||
Interest | Average | ||||||
Average | Income/ | Yield/ | |||||
Balance | Expense | Rate | |||||
ASSETS | |||||||
Earning assets: | |||||||
Loans | $ 7,005,731 | $ 104,481 | 6.05 | % | |||
Debt securities – taxable | 1,572,278 | 8,991 | 2.32 | ||||
Debt securities – tax exempt | 3,481 | 9 | 1.07 | ||||
Interest bearing deposits with banks and FFS | 2,799,540 | 32,052 | 4.64 | ||||
Total earning assets | 11,381,030 | 145,533 | 5.19 | ||||
Nonearning assets: | |||||||
Cash and due from banks | 218,164 | ||||||
Interest receivable and other assets | 795,316 | ||||||
Allowance for credit losses | (93,316) | ||||||
Total nonearning assets | 920,164 | ||||||
Total assets | $ 12,301,194 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Interest bearing liabilities: | |||||||
Transaction deposits | $ 927,265 | $ 1,632 | 0.71 | % | |||
Savings deposits | 4,424,063 | 30,491 | 2.80 | ||||
Time deposits | 705,787 | 3,054 | 1.76 | ||||
Short-term borrowings | 6,844 | 83 | 4.94 | ||||
Subordinated debt | 86,049 | 1,030 | 4.86 | ||||
Total interest bearing liabilities | 6,150,008 | 36,290 | 2.39 | ||||
Interest free funds: | |||||||
Noninterest bearing deposits | 4,797,014 | ||||||
Interest payable and other liabilities | 79,735 | ||||||
Stockholders' equity | 1,274,437 | ||||||
Total interest free funds | 6,151,186 | ||||||
Total liabilities and stockholders' equity | $ 12,301,194 | ||||||
Net interest income | $ 109,243 | ||||||
Net interest spread | 2.80 | % | |||||
Effect of interest free funds | 1.09 | % | |||||
3.89 | % | ||||||
SOURCE BancFirst
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