BancFirst Corporation Reports Third Quarter Earnings

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Oct 20, 2016, 05:00 ET

OKLAHOMA CITY, Oct. 20, 2016 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS:BANF) reported net income of $18.0 million, or $1.13 diluted earnings per share, for the third quarter of 2016 compared to net income of $15.6 million, or $0.98 diluted earnings per share, for the third quarter of 2015. Net income for the nine months ended September 30, 2016 was $52.1 million, or $3.28 per share, compared to $50.4 million, or $3.18 per share, for the first nine months of 2015.

The Company's net interest income for the third quarter of 2016 increased to $51.4 million compared to $46.9 million for the third quarter of 2015. The net interest margin for the quarter was 3.27% compared to 3.12% a year ago. Internal loan growth, acquired loans from our October 2015 acquisition and the increase in Fed Fund rate of 25 basis points during the 4th quarter of 2015 contributed to the higher net interest income and margin in 2016. The provision for loan losses for the third quarter of 2016 increased to $2.9 million compared to $1.4 million a year ago. The increase in the provision was largely due to a small number of commercial loan downgrades. Net charge-offs for the quarter were 0.03% of average loans, compared to 0.08% for the third quarter of 2015. Noninterest income for the quarter totaled $27.9 million, compared to $25.3 million last year. Noninterest expense for the quarter totaled $49.2 million compared to $46.4 million last year, as a result of salary increases and our acquisition in the fourth quarter of 2015. The Company's effective tax rate was 33.9% compared to 36.0% for the third quarter of 2015.

At September 30, 2016, the Company's total assets were $6.8 billion, largely unchanged from December 31, 2015. Securities decreased $79.2 million to a total of $473.7 million primarily due to maturities within the portfolio. Loans totaled $4.3 billion, down $19.6 million from June 30, 2016 and up $71.7 million from December 31, 2015. Deposits totaled $6.0 billion, virtually unchanged from the June 30, 2016 and December 31, 2015 totals. The Company's total stockholders' equity was $693.7 million, an increase of $38.2 million, or 5.8%, over December 31, 2015.

Asset quality remained solid during the third quarter of 2016. Nonperforming and restructured assets were 0.58% of total assets at September 30, 2016 compared to 0.83% at December 31, 2015. The decrease in nonperforming and restructured assets was largely due to one relationship that was removed from a troubled debt restructuring status due to sustained improvement in financial condition, performance, and the commercially reasonable nature of its structure. Sales of other real estate owned also contributed to the decrease in nonperforming assets. The allowance to total loans was 1.11% compared to 0.98% at year-end 2015. The allowance to nonperforming and restructured loans was 138.3% compared to 88.5% at year-end 2015.

BancFirst Corporation is an Oklahoma based financial services holding company. The Company's principal subsidiary bank, BancFirst, is Oklahoma's largest state-chartered bank with 100 banking locations serving 53 communities across Oklahoma. More information can be found at www.bancfirst.com.

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)

	2016		2016		2016		2015		2015
	3rd Qtr		2nd Qtr		1st Qtr		4th Qtr		3rd Qtr
Condensed Income Statements:
Net interest income	$ 51,431		$ 50,868		$ 49,976		$ 50,075		$ 46,876
Provision for loan losses	2,940		2,804		4,103		3,646		1,424
Non-interest income:
Trust revenue	2,685		2,602		2,465		2,254		2,295
Service charges on deposits	16,033		15,485		14,710		15,077		14,910
Securities transactions	(146)		(65)		100		2,148		-
Income from sales of loans	863		695		562		434		545
Insurance commissions	4,372		3,255		4,135		3,176		4,427
Cash management	2,853		2,732		2,318		1,899		1,906
Other	1,267		1,353		1,327		1,485		1,241
Total noninterest income	27,927		26,057		25,617		26,473		25,324

Non-interest expense:
Salaries and employee benefits	30,591		30,008		29,357		28,938		28,746
Occupancy expense, net	3,217		3,071		2,827		2,926		3,051
Depreciation	2,556		2,567		2,530		2,565		2,488
Amortization of intangible assets	560		580		581		602		444
Data processing services	1,178		1,174		1,215		1,151		1,132
Net expense (income) from other real estate owned	162		35		(1,141)		143		51
Marketing and business promotion	1,779		1,624		1,855		2,266		1,640
Deposit insurance	641		855		839		876		820
Other	8,520		7,806		8,228		9,544		7,980
Total noninterest expense	49,204		47,720		46,291		49,011		46,352
Income before income taxes	27,214		26,401		25,199		23,891		24,424
Income tax expense	9,232		8,908		8,620		8,163		8,794
Net income	$ 17,982		$ 17,493		$ 16,579		$ 15,728		$ 15,630
Per Common Share Data:
Net income-basic	$ 1.15		$ 1.12		$ 1.07		$ 1.00		$ 1.01
Net income-diluted	1.13		1.10		1.05		0.99		0.98
Cash dividends declared	0.38		0.36		0.36		0.36		0.36
Common shares outstanding	15,695,083		15,560,271		15,527,804		15,597,446		15,591,530
Average common shares outstanding -
Basic	15,631,094		15,549,811		15,534,416		15,609,599		15,581,593
Diluted	15,922,209		15,842,485		15,816,371		15,923,924		15,906,124
Performance Ratios:
Return on average assets	1.06	%	1.04	%	1.00	%	0.94	%	0.97	%
Return on average equity	10.35		10.42		10.05		9.51		9.64
Net interest margin	3.27		3.28		3.25		3.23		3.12
Efficiency ratio	62.00		62.03		61.24		64.03		64.20

BancFirst Corporation
Summary Financial Information
(Dollars in thousands, except per share and share data - Unaudited)

	Nine months ended September 30,
	2016		2015
Condensed Income Statements:
Net interest income	$ 152,275		$ 138,717
Provision for loan losses	9,847		4,029
Non-interest income:
Trust revenue	7,752		6,837
Service charges on deposits	46,228		42,574
Securities transactions	(111)		7,121
Income from sales of loans	2,120		1,534
Insurance commissions	11,762		11,615
Cash management	7,903		5,611
Other	3,947		4,043
Total noninterest income	79,601		79,335

Non-interest expense:
Salaries and employee benefits	89,956		84,145
Occupancy expense, net	9,115		8,586
Depreciation	7,653		7,401
Amortization of intangible assets	1,721		1,333
Data processing services	3,567		3,428
Net (income) expense from other real estate owned	(944)		181
Marketing and business promotion	5,258		4,720
Deposit insurance	2,335		2,482
Other	24,554		24,428
Total noninterest expense	143,215		136,704
Income before income taxes	78,814		77,319
Income tax expense	26,760		26,877
Net income	$ 52,054		$ 50,442
Per Common Share Data:
Net income-basic	$ 3.34		$ 3.25
Net income-diluted	3.28		3.18
Cash dividends declared	1.10		1.04
Common shares outstanding	15,695,083		15,591,530
Average common shares outstanding -
Basic	15,571,990		15,542,027
Diluted	15,862,780		15,871,991
Performance Ratios:
Return on average assets	1.03	%	1.04	%
Return on average stockholders' equity	10.27		10.68
Net interest margin	3.27		3.09
Efficiency ratio	61.76		62.69

	BancFirst Corporation
	Summary Financial Information
	(Dollars in thousands, except per share and share data - Unaudited)

	2016		2016		2016		2015		2015
	3rd Qtr		2nd Qtr		1st Qtr		4th Qtr		3rd Qtr
Balance Sheet Data:

Total assets	$ 6,783,537		$ 6,683,376		$ 6,740,938		$ 6,692,829		$ 6,406,096
Interest-bearing deposits with banks	1,532,095		1,373,923		1,498,356		1,394,813		1,491,873
Securities	473,738		419,238		497,986		552,949		507,858
Total loans	4,317,512		4,337,063		4,282,738		4,245,773		3,972,075
Allowance for loan losses	(48,061)		(46,566)		(44,571)		(41,666)		(40,970)
Deposits	6,024,949		5,943,982		6,010,872		5,973,358		5,698,591
Stockholders' equity	693,731		676,830		662,661		655,510		646,061
Book value per common share	44.20		43.50		42.68		42.03		41.44
Tangible book value per common share	39.87		39.09		38.22		37.56		37.99
Balance Sheet Ratios:
Average loans to deposits	71.77	%	71.74	%	71.28	%	69.62	%	67.88	%
Average earning assets to total assets	93.16		93.05		92.88		92.84		93.15
Average stockholders' equity to average assets	10.22		10.02		9.92		9.84		10.02
Asset Quality Data:
Past due loans	$ 1,906		$ 2,695		$ 1,099		$ 1,841		$ 2,061
Nonaccrual loans	31,014		30,063		31,040		30,096		30,321
Restructured loans	1,842		1,974		533		15,143		15,386
Total nonperforming and restructured loans	34,762		34,732		32,672		47,080		47,768
Other real estate owned and repossessed assets	4,339		4,469		4,245		8,214		7,863
Total nonperforming and restructured assets	39,101		39,201		36,917		55,294		55,631
Nonperforming and restructured loans to total loans	0.81	%	0.80	%	0.76	%	1.11	%	1.21	%
Nonperforming and restructured assets to total assets	0.58		0.59		0.55		0.83		0.87
Allowance to total loans	1.11		1.07		1.04		0.98		1.03
Allowance to nonperforming and restructured loans	138.26		134.07		136.42		88.50		85.77
Net charge-offs to average loans	0.03		0.02		0.03		0.07		0.08

	BancFirst Corporation
	Consolidated Average Balance Sheets
	And Interest Margin Analysis
	Taxable Equivalent Basis
	(Dollars in thousands - Unaudited)

	Three Months Ended					Nine Months Ended
	September 30, 2016					September 30, 2016
			Interest	Average			Interest	Average
	Average		Income/	Yield/		Average	Income/	Yield/
	Balance		Expense	Rate		Balance	Expense	Rate
ASSETS
Earning assets:
Loans		$ 4,300,400	$ 51,817	4.78	%	$ 4,279,894	$ 153,362	4.77	%
Securities – taxable	407,434		1,242	1.21		451,824	3,913	1.15
Securities – tax exempt	38,021		383	4.00		40,515	1,148	3.77
Interest bearing deposits with banks	1,535,048		1,968	0.51		1,471,623	5,622	0.51
Total earning assets	6,280,903		55,410	3.50		6,243,856	164,045	3.50

Nonearning assets:
Cash and due from banks	171,762					175,738
Interest receivable and other assets	335,855					336,188
Allowance for loan losses	(46,400)					(44,180)
Total nonearning assets	461,217					467,746
Total assets	$ 6,742,120					$ 6,711,602

LIABILITIES AND
STOCKHOLDERS' EQUITY
Interest bearing liabilities:
Transaction deposits	$ 777,284		$ 202	0.10	%	$ 785,496	$ 609	0.10	%
Savings deposits	2,079,991		1,729	0.33		2,082,417	5,112	0.33
Time deposits	701,760		1,218	0.69		710,566	3,600	0.67
Short-term borrowings	1,979		2	0.36		1,657	5	0.36
Junior subordinated debentures	31,959		524	6.51		31,959	1,569	6.54
Total interest bearing liabilities	3,592,973		3,675	0.41		3,612,095	10,895	0.40

Interest free funds:
Noninterest bearing deposits	2,433,136					2,399,275
Interest payable and other liabilities	26,660					25,232
Stockholders' equity	689,351					675,000
Total interest free funds	3,149,147					3,099,507
Total liabilities and stockholders' equity	$ 6,742,120					$ 6,711,602
Net interest income			$ 51,735				$ 153,150
Net interest spread				3.09	%			3.10	%
Effect of interest free funds				0.18	%			0.17	%
Net interest margin				3.27	%			3.27	%