BancFirst Corporation Reports Fourth Quarter Earnings

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January 17, 2020 11:45 AM EST

OKLAHOMA CITY, Jan. 17, 2020 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS: BANF) reported net income of $35.5 million, or $1.07 diluted earnings per share, for the fourth quarter of 2019 compared to net income of $32.7 million, or $0.98 diluted earnings per share, for the fourth quarter of 2018.  Net income for the twelve months ended December 31, 2019 was $134.9 million, or $4.05 per share, compared to $125.8 million, or $3.76 per share, for the twelve months ended December 31, 2018. On August 15, 2019 the Company completed the acquisition of Pegasus Bank in Dallas, Texas. As a result, year to date results include one-time acquisition related expenses of approximately $3.1 million, which reduced diluted earnings per share by approximately 7 cents for the year. On January 11, 2018 the Company completed the acquisitions of two Oklahoma banking corporations. Consequently, 2018 included one-time acquisition related expenses of approximately $2.6 million, which reduced diluted earnings per share by approximately 6 cents. 

The Company's net interest income for the fourth quarter of 2019 increased to $73.9 million compared to $66.9 million for the fourth quarter of 2018. The net interest margin for the quarter was 3.78% compared to 3.77% a year ago. The provision for loan losses for the fourth quarter of 2019 was $1.4 million compared to $1.5 million a year ago. Net charge-offs for the full year of 2019 were 0.10% of average loans compared to 0.08% of average loans in 2018. Net charge-offs for the fourth quarter of 2019 were 0.06% of average loans compared to 0.04% of average loans in 2018.  Noninterest income for the quarter totaled $35.5 million, compared to $31.9 million last year. The increase in noninterest income was primarily due to an increase in trust revenue, growth in debit card usage fees and sweep fees. Noninterest expense for the quarter totaled $66.3 million compared to $56.2 million last year. The increase in noninterest expense was primarily due to salary increases in 2019, the Pegasus Bank acquisition, and $2.3 million of amortization of new market tax credits. The Company's effective tax rate was 15.0% compared to 20.3% for the fourth quarter of 2018. The decrease in the effective tax rate compared to the fourth quarter of 2018 was due to the aforementioned purchase of tax credits during the quarter.

At December 31, 2019, the Company's total assets were $8.6 billion, an increase of $991.5 million from December 31, 2018. Securities of $491.6 million were down $280.5 million from December 31, 2018. Loans totaled $5.7 billion, an increase of $689.0 million from December 31, 2018. Deposits totaled $7.5 billion, an increase of $878.1 million from the December 31, 2018 total. The Company's total stockholders' equity was $1.0 billion, an increase of $102.2 million over December 31, 2018.

On August 15, 2019, BancFirst Corporation acquired Pegasus Bank ("Pegasus"), for an aggregate cash purchase price of $123.5 million. Pegasus is a Texas state-chartered bank with three banking locations in Dallas, Texas. Upon acquisition, Pegasus had approximately $651.1 million in total assets, $389.9 million in loans, and $603.9 million in deposits. The Bank will continue to operate as "Pegasus Bank" under a separate Texas state-charter and remain an independent subsidiary of BancFirst Corporation.

Asset quality remained strong during the fourth quarter of 2019.  Nonperforming and restructured assets represented 0.63% of total assets at December 31, 2019, up from 0.59% at year-end 2018. The allowance to total loans was 0.96% down slightly from 1.03% at year-end 2018. The allowance to nonperforming and restructured loans was 113.40% compared to 136.29% at year-end 2018.

BancFirst Corporation CEO David Harlow commented, "The Company reported strong results for the fourth quarter and record earnings per share and net income for the year despite the headwind of lower interest rates during the second half of 2019.  While net interest margin will continue to be under pressure in 2020, we were able to protect our margin in 2019 through loan growth, liability repricing, and the strength and size of our non-interest bearing deposit book.  Non-interest income continued strong year-over-year growth while asset quality remained solid with 10bps of charge offs for the year.  We are pleased with the integration of Pegasus Bank into BancFirst Corporation during the latter part of 2019 and are excited about the growth platform the Dallas market will provide the Company going forward.  We will continue to build upon our core Oklahoma franchise as we have in the past through both organic growth and strategic acquisitions."

BancFirst Corporation (the Company) is an Oklahoma based financial services holding company.  The Company operates two subsidiary banks, BancFirst, is Oklahoma's largest state-chartered bank with 108 banking locations serving 58 communities across Oklahoma, and Pegasus Bank, with 3 banking locations in Dallas, TX. 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)

2019

2019

2019

2019

2018

4th Qtr 

3rd Qtr 

2nd Qtr 

1st Qtr 

4th Qtr 

Condensed Income Statements: 

Net interest income 

$              73,939

$               72,287

$              68,792

$              66,903

$              66,888

Provision for loan losses 

1,412

2,758

2,433

1,684

1,516

Non-interest income:

Trust revenue

3,682

3,490

3,250

3,177

3,023

Service charges on deposits

19,938

19,866

19,114

17,663

18,554

Securities transactions

(9)

--

821

--

10

Income from sales of loans

913

964

868

698

649

Insurance commissions

5,076

5,535

4,420

5,265

4,593

Cash management

4,258

4,430

4,402

3,776

3,338

Other

1,666

1,342

1,202

1,422

1,684

Total noninterest income 

35,524

35,627

34,077

32,001

31,851

Non-interest expense:

Salaries and employee benefits

40,375

40,354

36,124

36,171

35,530

Occupancy expense, net

3,738

3,386

2,953

2,627

3,307

Depreciation

3,355

3,268

3,015

2,985

2,965

Amortization of intangible assets

1,360

842

758

759

777

Data processing services

1,634

1,467

1,262

1,480

1,140

Net expense from other real estate owned

(424)

26

97

(484)

130

Marketing and business promotion

2,327

2,047

1,919

2,261

2,030

Deposit insurance

147

(81)

544

533

571

Other

13,784

10,882

9,936

9,874

9,716

Total noninterest expense 

66,296

62,191

56,608

56,206

56,166

Income before income taxes 

41,755

42,965

43,828

41,014

41,057

Income tax expense 

6,248

9,597

9,661

9,177

8,332

Net income 

$              35,507

$              33,368

$              34,167

$              31,837

$              32,725

Per Common Share Data: 

Net income-basic 

$                  1.09

$                  1.02

$                  1.04

$                  0.98

$                  1.00

Net income-diluted 

1.07

1.00

1.02

0.96

0.98

Cash dividends declared

0.32

0.32

0.30

0.30

0.30

Common shares outstanding 

32,694,268

32,644,018

32,639,588

32,617,788

32,603,926

Average common shares outstanding -

   Basic

32,673,438

32,641,902

32,629,146

32,612,399

32,721,626

   Diluted

33,366,848

33,327,213

33,317,193

33,292,852

33,423,458

Performance Ratios: 

Return on average assets

1.66

%

1.65

%

1.78

%

1.69

%

1.70

%

Return on average equity

13.76

13.80

14.54

14.08

14.48

Net interest margin 

3.78

3.89

3.89

3.85

3.77

Efficiency ratio 

60.56

57.63

55.03

56.83

56.88

 

BancFirst Corporation

Summary Financial Information

(Dollars in thousands, except per share and share data - Unaudited)

Twelve months ended

December 31,

2019

2018

 Condensed Income Statements: 

 Net interest income 

$             281,921

$             260,476

 Provision for loan losses 

8,287

3,802

 Non-interest income:

Trust revenue

13,599

12,829

Service charges on deposits

76,581

70,847

Securities transactions

812

47

Income from sales of loans

3,443

2,902

Insurance commissions

20,296

18,926

Cash management

16,866

13,123

Other

5,632

6,525

Total noninterest income 

137,229

125,199

 Non-interest expense:

Salaries and employee benefits

153,024

139,547

Occupancy expense, net

12,704

13,491

Depreciation

12,623

10,537

Amortization of intangible assets

3,719

3,009

Data processing services

5,843

4,956

Net expense from other real estate owned

(785)

239

Marketing and business promotion

8,554

8,028

Deposit insurance

1,143

2,427

Other

44,476

39,887

Total noninterest expense 

241,301

222,121

 Income before income taxes 

169,562

159,752

 Income tax expense 

34,683

33,938

 Net income 

$             134,879

$             125,814

 Per Common Share Data: 

 Net income-basic 

$                   4.13

$                   3.85

 Net income-diluted 

4.05

3.76

 Cash dividends declared

1.24

1.02

 Common shares outstanding 

32,694,268

32,603,926

 Average common shares outstanding -

   Basic

32,639,396

32,689,228

   Diluted

33,329,844

33,430,714

 Performance Ratios: 

 Return on average assets

1.69

%

1.66

%

 Return on average stockholders' equity

14.04

14.59

 Net interest margin 

3.85

3.70

 Efficiency ratio 

57.57

57.59

 

BancFirst Corporation

Summary Financial Information

(Dollars in thousands, except per share and share data - Unaudited)

2019

2019

2019

2019

2018

4th Qtr

3rd Qtr

2nd Qtr

1st Qtr 

4th Qtr

Balance Sheet Data:

Total assets

$  8,565,758

$  8,388,816

$  7,642,021

$  7,709,000

$  7,574,258

Interest-bearing deposits with banks

1,646,238

1,476,340

1,518,998

1,291,447

1,195,824

Debt securities

491,626

555,575

425,154

724,872

772,132

Total loans

5,673,144

5,622,897

5,105,302

5,050,221

4,984,150

Allowance for loan losses

(54,238)

(55,928)

(55,108)

(52,915)

(51,389)

Deposits

7,483,635

7,330,677

6,613,613

6,706,386

6,605,495

Stockholders' equity

1,004,990

979,752

956,380

927,927

902,789

Book value per common share

30.74

30.01

29.30

28.45

27.69

Tangible book value per common share (non-GAAP)(1)

25.50

24.77

26.40

25.52

24.74

Balance Sheet Ratios:

Average loans to deposits

75.83

%

77.68

%

76.07

%

75.34

%

74.24

%

Average earning assets to total assets

91.50

92.23

92.43

92.42

92.48

Average stockholders' equity to average assets

12.04

11.96

12.25

12.01

11.76

Asset Quality Data:

Past due loans

$       11,834

$       11,214

$         2,663

$         2,170

$         1,916

Nonaccrual loans

17,984

20,316

17,998

21,594

22,603

Restructured loans

18,010

17,504

16,486

14,552

13,188

Total nonperforming and restructured loans

47,828

49,034

37,147

38,316

37,707

Other real estate owned and repossessed assets

6,073

7,056

7,004

6,433

6,873

Total nonperforming and restructured assets

53,901

56,090

44,151

44,749

44,580

Nonperforming and restructured loans to total loans

0.84

%

0.87

%

0.73

%

0.76

%

0.76

%

Nonperforming and restructured assets to total assets

0.63

0.67

0.58

0.58

0.59

Allowance to total loans

0.96

0.99

1.08

1.05

1.03

Allowance to nonperforming and restructured loans

113.40

114.06

148.35

138.10

136.29

Net charge-offs to average loans

0.06

0.04

0.01

0.00

0.04

Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(2):

Stockholders' equity

$  1,004,990

$     979,752

$     956,380

$     927,927

$     902,789

Less goodwill

148,604

147,013

79,749

79,749

79,749

Less intangible assets, net

22,608

24,025

14,936

15,701

16,470

Tangible stockholders' equity (non-GAAP)

$     833,778

$     808,714

$     861,695

$     832,477

$     806,570

Common shares outstanding

32,694,268

32,644,018

32,639,588

32,617,788

32,603,926

 Tangible book value per common share (non-GAAP)

$         25.50

$         24.77

$         26.40

$         25.52

$         24.74

(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.

 

BancFirst Corporation

Consolidated Average Balance Sheets

And Interest Margin Analysis

Taxable Equivalent Basis

(Dollars in thousands - Unaudited)

Three Months Ended

Twelve Months Ended

December 31, 2019

December 31, 2019

Interest

Average

Interest

Average

Average

Income/

Yield/

Average

Income/

Yield/

Balance

Expense

Rate

Balance

Expense

Rate

ASSETS

Earning assets:

  Loans

$           5,614,570

$           76,691

5.42

%

$        5,273,632

$         292,152

5.54

%

  Securities – taxable

513,551

2,757

2.13

588,207

13,308

2.26

  Securities – tax exempt

21,798

141

2.57

20,219

580

2.87

  Interest bearing deposits with banks

1,628,088

6,782

1.65

1,455,799

31,372

2.15

     Total earning assets

7,778,007

86,371

4.41

7,337,857

337,412

4.60

Nonearning assets:

  Cash and due from banks

184,829

180,339

  Interest receivable and other assets

592,100

500,487

  Allowance for loan losses

(54,454)

(53,975)

     Total nonearning assets

722,475

626,851

     Total assets

$            8,500,482

$        7,964,708

LIABILITIES AND STOCKHOLDERS' EQUITY

Interest bearing liabilities:

  Transaction deposits                      

$           774,824

$               606

0.31

%

$           751,140

$             2,573

0.34

%

  Savings deposits

3,024,500

8,318

1.09

2,782,086

39,170

1.41

  Time deposits

698,295

2,831

1.61

690,636

10,995

1.59

  Short-term borrowings

891

3

1.51

1,458

32

2.19

  Junior subordinated debentures

26,804

492

7.29

26,804

1,966

7.34

     Total interest bearing liabilities

4,525,314

12,250

1.07

4,252,124

54,736

1.29

Interest free funds:

  Noninterest bearing deposits

2,906,310

2,709,510

  Interest payable and other liabilities

45,426

42,219

  Stockholders' equity

1,023,432

960,855

     Total interest free  funds

3,975,168

3,712,584

     Total liabilities

       and stockholders' equity

$            8,500,482

$        7,964,708

Net interest income

$           74,121

$         282,676

Net interest spread

3.34

%

3.31

%

Effect of interest free funds

0.44

%

0.54

%

Net interest margin

3.78

%

3.85

%

 

Cision View original content:http://www.prnewswire.com/news-releases/bancfirst-corporation-reports-fourth-quarter-earnings-300988983.html

SOURCE BancFirst


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