8-K
Equity Bancshares Inc (EQBK)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 29, 2020
EQUITY BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
| Kansas | 001-37624 | 72-1532188 |
|---|---|---|
| (State or other jurisdiction of<br><br><br>incorporation or organization) | (Commission<br><br><br>File Number) | (I.R.S. Employer<br><br><br>Identification No.) |
| 7701 East Kellogg Drive, Suite 300<br><br><br>Wichita, KS | 67207 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: 316.612.6000
Former name or former address, if changed since last report: Not Applicable
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class<br><br><br>Class A, Common Stock, par value $0.01 per share | Trading Symbol<br><br><br>EQBK | Name of each exchange on which registered<br><br><br>The Nasdaq Stock Market LLC |
|---|
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
☒ Emerging growth company
☒ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 2.02Results of Operations and Financial Condition.
On April 29, 2020, Equity Bancshares, Inc. (the “Company”) issued a press release announcing its financial results for the first quarter ended March 31, 2020. A copy of the press release is furnished as Exhibit 99.1 and is incorporated by reference herein.
The information in this Item 2.02, including Exhibit 99.1, is being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.
Item 7.01Regulation FD Disclosure.
The Company intends to hold an investor call and webcast to discuss its financial results for the first quarter ended March 31, 2020 on Thursday, April 30, 2020, at 9:00 a.m. Central Time. The Company’s presentation to analysts and investors contains additional information about the Company’s financial results for the first quarter ended March 31, 2020 and is furnished as Exhibit 99.2 and is incorporated by reference herein.
The information in this Item 7.01, including Exhibit 99.2, is being furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.
Item 9.01Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description |
|---|---|
| 99.1 | Earnings Press Release, dated April 29, 2020 |
| 99.2 | Equity Bancshares, Inc. Investor Presentation |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Equity Bancshares, Inc. | |
|---|---|
| Date: April 29, 2020 | By: /s/ Gregory H. Kossover |
| Gregory H. Kossover | |
| Executive Vice President and Chief Financial Officer |
3
eqbk-ex991_6.htm
Exhibit 99.1
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
Equity Bancshares, Inc. Announces First Quarter Earnings of $0.08
per Diluted Common Share and Net Income of $1.3 Million
Company reports net interest margin expansion in first quarter; provision for loan losses of $9.9 million or 85% of pre-tax income; and enters COVID-19 era with strong PPP lending for local businesses
WICHITA, Kansas, April 29, 2020 (GLOBE NEWSWIRE) – Equity Bancshares, Inc. (NASDAQ: EQBK), (“Equity”, “we”, “us”, “our”), the Wichita-based holding company of Equity Bank, reported its unaudited results for the first quarter ended March 31, 2020, including net income allocable to common stockholders of $1.3 million, or $0.08 per diluted share.
“Our first quarter 2020 results exceeded our expectations on a pre-loan loss provision basis,” said Brad Elliott, Chairman and CEO of Equity. “We were able to increase our net interest margin by moving swiftly to lower our cost of liabilities in the quarter. In this COVID-19 environment we believe the prudent course of action, at this point, is to provide reserves for the unknown, which we did with a $9.9 million provision for loan losses.”
Equity completed over 1,600 Small Business Administration (“SBA”) loan applications through phase one of the Paycheck Protection Program (“PPP”) as part of the U.S. Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) signed into law on March 27, 2020. The relief from Equity-administered loans helped more than 78,000 employees working in small businesses throughout Equity’s regions in Kansas, Missouri, Oklahoma and Arkansas.
Equity moved its branch operations to a “Branch Light, Drive Through First” model beginning on March 16, 2020 sequentially throughout its markets. The Company continued to provide full service through its drive-through banking teams and offered lobby access to commercial, mortgage and consumer customers upon request. Equity saw a 7% monthly increase in digital transactions, including bill payments, mobile deposits and transfers in March 2020, and a 9% monthly increase in total logins.
“In our first quarter, I’m proud of our collective efforts as a company to continue to deliver outstanding service to our customers while helping them manage through an unprecedented crisis,” said Mr. Elliott. “It’s critical for us to fulfill a leadership role in our communities, helping local businesses to continue to operate. I am proud of our Equity Bank team members and their commitment to our communities, which is key to our success as a company. Our bankers were front-and-center to businesses in need and our credit administration and loan processing teams have worked efficiently and swiftly to ensure our customers have uninterrupted services.”
Notable Items:
| • | Net income before taxes for the first quarter of 2020 was $1.7 million, or $0.11 per diluted share, compared to a net loss before taxes of $5.2 million, or $0.33 per diluted share, for the same time period in 2019. There were no merger expenses in the first quarter of 2020. Net loss before taxes, adjusted to exclude merger expense was $4.6 million, or $0.29 per diluted share, for the first quarter of 2019. |
|---|---|
| • | Stated diluted income per share in the first quarter of 2020 was $0.08, as compared to $(0.26) in the first quarter of 2019. Income before taxes and provision for loan losses during the periods ending March 31, 2020 and 2019, was $11.6 million and $10.4 million. |
| --- | --- |
| • | On April 18, 2019, the Board of Directors of Equity Bancshares, Inc. authorized the repurchase of up to 1,100,000 shares of our Class A Voting Common Stock, par value $0.01 per share, from time to time, beginning April 29, 2019, and concluding October 30, 2020. The repurchase program does not obligate us to acquire a specific dollar amount or number of shares and it may be extended, modified or discontinued at any time without notice. There was a total of 295,461 shares repurchased during the first quarter of 2020 at a weighted average price of $23.33. In March, in response to the COVID-19 environment, the Board of Directors of Equity Bancshares voted to temporarily suspend the repurchase program. A total of 383,523 shares remain authorized for repurchase. |
| --- | --- |
| • | The CARES Act provided temporary relief for the implementation of Accounting Standards Update No. 2016-13, Measurement of Credit Losses on Financial Instruments and the Company has elected to calculate the required allowance for loan losses and the resulting provision for loan losses using the prior probable-incurred-loss method. |
| --- | --- |
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
Equity’s Balance Sheet Highlights:
| • | Total loans held for investment of $2.51 billion at March 31, 2020, as compared to total loans held for investment of $2.56 billion at December 31, 2019. |
|---|---|
| • | Total deposits were $2.96 billion at March 31, 2020, as compared to $3.06 billion at December 31, 2019. Signature deposits, including core deposits comprised of checking, savings and money market accounts, were $2.18 billion at March 31, 2020, as compared to $2.23 billion at December 31, 2019. |
| --- | --- |
| • | Total assets were $3.94 billion at March 31, 2020, as compared to $3.95 billion at December 31, 2019. |
| --- | --- |
| • | Book value per common share was $31.41 at March 31, 2020, as compared to $30.95 at December 31, 2019. Tangible book value per common share was $21.10 at March 31, 2020, as compared to $20.75 at December 31, 2019. |
| --- | --- |
Financial Results for the Quarter Ended March 31, 2020
Net income allocable to common stockholders was $1.3 million for the three months ended March 31, 2020, as compared to net loss allocable to common stockholders of $4.1 million for the three months ended March 31, 2019, an increase of $5.3 million.
Diluted earnings per share were $0.08 for the three months ended March 31, 2020, as compared to a loss per share of $0.26 for the comparable period in 2019. Weighted average fully diluted shares were 15,595,024 and 15,804,508 for the three months ended March 31, 2020 and 2019.
Net interest income was $32.1 million for the three months ended March 31, 2020, as compared to $30.6 million for the three months ended March 31, 2019, a $1.5 million, or 4.7%, increase. The increase in net interest income was primarily driven by average rates of interest-bearing liabilities repricing at a faster rate than average rates of interest-earning assets.
The net interest margin was 3.67% for the three months ended March 31, 2020, as compared to 3.49% for the three months ended March 31, 2019. The increase in net interest margin was primarily due to a declining-rate environment where the average rate of interest-bearing liabilities fell faster than the average rate of interest-earning assets. Higher cost deposits were repriced downward and our Federal Home Loan Bank advances were refinanced at lower rates.
The provision for loan losses was $9.9 million for the three months ended March 31, 2020, as compared to $15.6 million for the three months ended March 31, 2019. Included in the first quarter of 2019 was a $14.5 million provision against one credit relationship we believe was an isolated incident that was unique within our portfolio. For the three months ended March 31, 2020, we had net charge-offs of $257 thousand as compared to net charge-offs of $760 thousand for the same period in 2019.
Total non-interest income for the quarter ended March 31, 2020, was $5.3 million, as compared to $5.3 million for the quarter ended March 31, 2019. A decrease in other non-interest income, mainly from the increase in derivative mark-to-market valuation losses, was principally offset by increases in debit card income, mortgage banking and service charges and fees.
Total non-interest expense was $25.8 million for the quarter ended March 31, 2020, as compared to $25.5 million for the quarter ended March 31, 2019. The increase in non-interest expense is due largely to increases in net occupancy and equipment, data processing, FDIC insurance, professional fees, other non-interest expense and other real estate owned, partially offset by decreases in salaries and employee benefits and telecommunications. Also, non-interest expense does not include any merger expenses for the three months ended March 31, 2020. Merger expenses for the three months ended March 31, 2019, totaled $639 thousand ($487 thousand after tax).
Equity’s effective tax rate for the quarter ended March 31, 2020, was 26.1%, as compared to 22.1% for the quarter ended March 31, 2019. For both of the comparable periods, the estimated annual effective tax rate at which income tax expense (benefits) have been provided reflect, in addition to statutory tax rates, the estimated tax-exempt interest income, non-taxable life insurance income, non-deductible facilitative merger expense and other non-deductible expense in proportion
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
to anticipated annual income before income taxes, as well as federal income tax credits anticipated to be available in each annual period. Income tax expense for the quarter ended March 31, 2020, includes $62 thousand of additional expense attributable to the settlement in stock of restricted stock units and the exercise of stock options. The exercise of stock options and the settlement of restricted stock units in the quarter ended March 31, 2019, resulted in tax benefits of $8 thousand.
Loans, Deposits and Total Assets
Loans held for investment were $2.51 billion at March 31, 2020, as compared to $2.56 billion at December 31, 2019, a decrease of $49.5 million. The decrease in loans is primarily the result of net paydowns in the commercial and industrial, agricultural real estate and residential real estate portfolios, which were partially offset by originations during the quarter.
As of March 31, 2020, Equity’s allowance for loan losses to total loans was 0.87%, as compared to 0.48% at December 31, 2019. Total reserves, including purchase discounts, to total loans were approximately 1.26% as of March 31, 2020, as compared to 0.85% at December 31, 2019. Nonperforming assets were $48.1 million as of March 31, 2020, or 1.22% of total assets. Nonperforming assets were $46.9 million at December 31, 2019, or 1.19% of total assets.
Total deposits were $2.96 billion at March 31, 2020, as compared to $3.06 billion at December 31, 2019, a decrease of $103.1 million. This decrease included $80.9 million of savings, NOW and money market deposits and $49.4 million of time deposits, partially offset by an increase of $27.1 million in demand deposits. The changes in deposits are primarily from decreases by commercial customers and public fund balances related to distribution of tax monies at the local level and seasonality. Signature deposits were $2.18 billion at March 31, 2020, as compared to $2.23 billion at December 31, 2019.
At March 31, 2020, Equity had consolidated total assets of $3.94 billion, as compared to $3.95 billion at December 31, 2019, a decrease of $5.7 million.
Borrowings and Capital
At March 31, 2020, borrowings totaled $481.4 million, as compared to $383.6 million at December 31, 2019. The increase in borrowings was principally due to a $65.2 million increase in Federal Home Loan Bank advances and a $31.0 million increase in the bank stock loan balance.
At March 31, 2020, common stockholders’ equity totaled $477.4 million, $31.41 per common share, as compared to $478.1 million, $30.95 per common share, at December 31, 2019. Tangible common equity was $320.6 million and tangible book value per common share was $21.10 at March 31, 2020. Tangible common equity was $320.5 million and tangible book value per common share was $20.75 at December 31, 2019. During the first quarter of 2020, the company repurchased a total of 295,461 shares of our Class A Voting Common Stock at a total cost of $6.9 million, or $23.33 weighted average per share. The Company’s ratio of common equity tier 1 capital to risk-weighted assets was 11.67%, the total capital to risk-weighted assets was 13.00% and the total leverage ratio was 9.02% at March 31, 2020. The Company’s subsidiary, Equity Bank’s, ratio of common equity tier 1 capital to risk-weighted assets was 12.71%, the total capital to risk-weighted assets was 13.50% and the total leverage ratio was 9.39% at March 31, 2020.
Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of this press release.
Conference Call and Webcast
Equity Chairman and Chief Executive Officer, Brad Elliott, and Chief Financial Officer, Greg Kossover, will hold a conference call and webcast to discuss first quarter 2020 results on Thursday, April 30, 2020, at 10 a.m. eastern time, 9:00 a.m. central time.
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
Investors, news media and other participants should register for the call or audio webcast at investor.equitybank.com. On Thursday, April 30, 2020, participants may also dial into the call toll-free at (844) 534-7311 from anywhere in the U.S. or (574) 990-1419 internationally, using conference ID no. 4407029.
Participants are encouraged to dial into the call or access the webcast approximately 10 minutes prior to the start time. Presentation slides to pair with the call or webcast will be posted one hour prior to the call at investor.equitybank.com.
A replay of the call and webcast will be available two hours following the close of the call until May 7, 2020, accessible at (855) 859-2056 with conference ID no. 4407029 at investor.equitybank.com.
About Equity Bancshares, Inc.
Equity Bancshares, Inc. is the holding company for Equity Bank, offering a full range of financial solutions, including commercial loans, consumer banking, mortgage loans, trust and wealth management services and treasury management services, while delivering the high-quality, relationship-based customer service of a community bank. Equity’s common stock is traded on the NASDAQ Global Select Market under the symbol “EQBK.” Learn more at www.equitybank.com.
Special Note Concerning Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect the current views of Equity’s management with respect to, among other things, future events and Equity’s financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about Equity’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond Equity’s control. Accordingly, Equity cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although Equity believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from Equity’s expectations include COVID-19 related impacts; competition from other financial institutions and bank 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. The foregoing list of factors is not exhaustive.
For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in Equity’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 10, 2020, and any updates to those risk factors set forth in Equity’s subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if Equity’s underlying assumptions prove to be incorrect, actual results may differ materially from what Equity anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and Equity does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, such as COVID-19, and it is not possible for us to predict those events or how they may affect us. In addition, Equity cannot assess the impact of each factor on Equity’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
statement should also be considered in connection with any subsequent written or oral forward-looking statements that Equity or persons acting on Equity’s behalf may issue.
Investor Contact:
Chris Navratil
SVP, Finance
Equity Bancshares, Inc.
(316) 612-6014
cnavratil@equitybank.com
Media Contact:
John J. Hanley
SVP, Senior Director of Marketing
Equity Bancshares, Inc.
(816) 505-4063
jhanley@equitybank.com
Unaudited Financial Tables
| • | Table 1. Selected Financial Highlights |
|---|---|
| • | Table 2. Year-to-Date Analysis of Changes in Net Interest Income |
| --- | --- |
| • | Table 3. Consolidated Balance Sheets |
| --- | --- |
| • | Table 4. Consolidated Statements of Operations |
| --- | --- |
| • | Table 5. Non-GAAP Financial Measures |
| --- | --- |
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
TABLE 1. SELECTED FINANCIAL HIGHLIGHTS (Unaudited)
(Dollars in thousands, except per share data)
| As of and for the three months ended | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||
| 2020 | 2019 | 2019 | 2019 | 2019 | |||||||||||
| Statement of Income Data | |||||||||||||||
| Net interest income | $ | 32,095 | $ | 32,405 | $ | 31,526 | $ | 31,288 | $ | 30,639 | |||||
| Provision for loan losses | 9,940 | 1,055 | 679 | 974 | 15,646 | ||||||||||
| Net gains (losses) from securities transactions | 8 | (3 | ) | 4 | 7 | 6 | |||||||||
| Other non-interest income | 5,298 | 6,644 | 6,568 | 6,444 | 5,318 | ||||||||||
| Total non-interest income | 5,306 | 6,641 | 6,572 | 6,451 | 5,324 | ||||||||||
| Merger expense | — | — | — | 276 | 639 | ||||||||||
| Other non-interest expense | 25,758 | 24,846 | 24,223 | 24,747 | 24,904 | ||||||||||
| Total non-interest expense | 25,758 | 24,846 | 24,223 | 25,023 | 25,543 | ||||||||||
| Income (loss) before income taxes | 1,703 | 13,145 | 13,196 | 11,742 | (5,226 | ) | |||||||||
| Provision for income taxes (benefits) | 445 | 3,131 | 2,790 | 2,510 | (1,153 | ) | |||||||||
| Net income (loss) allocable to common stockholders | 1,258 | 10,014 | 10,406 | 9,232 | (4,073 | ) | |||||||||
| Basic earnings (loss) per share | 0.08 | 0.65 | 0.67 | 0.59 | (0.26 | ) | |||||||||
| Diluted earnings (loss) per share | 0.08 | 0.64 | 0.66 | 0.58 | (0.26 | ) | |||||||||
| Balance Sheet Data (at period end) | |||||||||||||||
| Available-for-sale securities | $ | 187,812 | $ | 142,067 | $ | 152,680 | $ | 161,082 | $ | 166,355 | |||||
| Held-to-maturity securities | 721,992 | 769,059 | 764,163 | 766,950 | 749,493 | ||||||||||
| Gross loans held for investment | 2,507,123 | 2,556,652 | 2,600,924 | 2,679,985 | 2,618,986 | ||||||||||
| Allowance for loan losses | 21,915 | 12,232 | 17,875 | 17,777 | 26,340 | ||||||||||
| Intangible assets, net | 156,704 | 157,518 | 158,350 | 159,147 | 159,944 | ||||||||||
| Total assets | 3,943,832 | 3,949,578 | 4,074,663 | 4,180,074 | 4,065,354 | ||||||||||
| Total deposits | 2,960,397 | 3,063,516 | 3,106,929 | 3,185,893 | 3,260,870 | ||||||||||
| Non-time deposits | 2,176,586 | 2,230,346 | 2,177,820 | 2,192,534 | 2,220,110 | ||||||||||
| Borrowings | 481,371 | 383,632 | 480,000 | 515,582 | 331,221 | ||||||||||
| Total liabilities | 3,466,481 | 3,471,518 | 3,607,613 | 3,721,668 | 3,611,891 | ||||||||||
| Total stockholders’ equity | 477,351 | 478,060 | 467,050 | 458,406 | 453,463 | ||||||||||
| Tangible common equity^*^ | 320,647 | 320,542 | 308,700 | 299,259 | 293,519 | ||||||||||
| Selected Average Balance Sheet Data (quarterly average) | |||||||||||||||
| Investment securities | $ | 907,910 | $ | 911,923 | $ | 926,839 | $ | 924,914 | $ | 918,804 | |||||
| Total gross loans receivable | 2,525,344 | 2,568,301 | 2,646,454 | 2,655,256 | 2,560,030 | ||||||||||
| Interest-earning assets | 3,519,267 | 3,563,642 | 3,657,970 | 3,665,618 | 3,560,815 | ||||||||||
| Total assets | 3,888,205 | 3,932,909 | 4,030,606 | 4,025,764 | 3,926,359 | ||||||||||
| Interest-bearing deposits | 2,531,508 | 2,563,519 | 2,673,007 | 2,726,443 | 2,709,596 | ||||||||||
| Borrowings | 355,303 | 377,561 | 390,562 | 347,103 | 269,492 | ||||||||||
| Total interest-bearing liabilities | 2,886,811 | 2,941,080 | 3,063,569 | 3,073,546 | 2,979,088 | ||||||||||
| Total deposits | 3,021,181 | 3,055,275 | 3,152,785 | 3,200,624 | 3,178,164 | ||||||||||
| Total liabilities | 3,405,638 | 3,459,347 | 3,567,354 | 3,568,661 | 3,466,646 | ||||||||||
| Total stockholders' equity | 482,567 | 473,562 | 463,252 | 457,103 | 459,713 | ||||||||||
| Tangible common equity^*^ | 325,470 | 315,569 | 304,492 | 297,541 | 302,398 | ||||||||||
| Performance ratios | |||||||||||||||
| Return on average assets (ROAA) annualized | 0.13 | % | 1.01 | % | 1.02 | % | 0.92 | % | (0.42 | )% | |||||
| Return on average equity (ROAE) annualized | 1.05 | % | 8.39 | % | 8.91 | % | 8.10 | % | (3.59 | )% | |||||
| Return on average tangible common equity (ROATCE) annualized^*^ | 2.35 | % | 13.42 | % | 14.38 | % | 13.29 | % | (4.62 | )% | |||||
| Yield on loans annualized | 5.47 | % | 5.67 | % | 5.70 | % | 5.74 | % | 5.79 | % | |||||
| Cost of interest-bearing deposits annualized | 1.09 | % | 1.32 | % | 1.56 | % | 1.64 | % | 1.61 | % | |||||
| Cost of total deposits annualized | 0.91 | % | 1.11 | % | 1.32 | % | 1.40 | % | 1.37 | % | |||||
| Net interest margin annualized | 3.67 | % | 3.61 | % | 3.42 | % | 3.42 | % | 3.49 | % | |||||
| Efficiency ratio^*^ | 68.88 | % | 63.63 | % | 63.59 | % | 65.59 | % | 69.26 | % | |||||
| Non-interest income / average assets | 0.55 | % | 0.67 | % | 0.65 | % | 0.64 | % | 0.55 | % | |||||
| Non-interest expense / average assets | 2.66 | % | 2.51 | % | 2.38 | % | 2.49 | % | 2.64 | % | |||||
| Capital Ratios |
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
| Tier 1 Leverage Ratio | 9.02 | % | 9.02 | % | 8.49 | % | 8.26 | % | 8.37 | % | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Common Equity Tier 1 Capital Ratio | 11.67 | % | 11.63 | % | 11.08 | % | 10.46 | % | 10.46 | % | |||||
| Tier 1 Risk Based Capital Ratio | 12.20 | % | 12.15 | % | 11.59 | % | 10.95 | % | 10.96 | % | |||||
| Total Risk Based Capital Ratio | 13.00 | % | 12.59 | % | 12.21 | % | 11.56 | % | 11.87 | % | |||||
| Total stockholders' equity to total assets | 12.10 | % | 12.10 | % | 11.46 | % | 10.97 | % | 11.15 | % | |||||
| Tangible common equity to tangible assets^*^ | 8.47 | % | 8.45 | % | 7.88 | % | 7.44 | % | 7.52 | % | |||||
| Book value per common share | $ | 31.41 | $ | 30.95 | $ | 30.25 | $ | 29.45 | $ | 28.66 | |||||
| Tangible book value per common share^*^ | $ | 21.10 | $ | 20.75 | $ | 19.99 | $ | 19.23 | $ | 18.55 | |||||
| Tangible book value per diluted common share^*^ | $ | 20.96 | $ | 20.39 | $ | 19.73 | $ | 18.99 | $ | 18.30 |
* The value noted is considered a Non-GAAP financial measure. For a reconciliation of Non-GAAP financial measures, see Table 5. Non-GAAP Financial Measures
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
TABLE 2. QUARTERLY ANALYSIS OF CHANGES IN NET INTEREST INCOME (Unaudited)
(Dollars in thousands)
| For the quarter ended | For the quarter ended | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| March 31, 2020 | March 31, 2019 | |||||||||||||
| Average Outstanding Balance | Interest Income/ Expense | Average<br><br><br>Yield/Rate^(3)(4)^ | Average Outstanding Balance | Interest Income/ Expense | Average<br><br><br>Yield/Rate^(3)(4)^ | |||||||||
| Interest-earning assets | ||||||||||||||
| Loans ^(1)^ | $ | 2,525,344 | $ | 34,376 | 5.47 | % | $ | 2,560,030 | $ | 36,533 | 5.79 | % | ||
| Total securities | 907,910 | 5,586 | 2.47 | % | 918,804 | 6,035 | 2.66 | % | ||||||
| Federal funds sold and other | 86,013 | 595 | 2.78 | % | 81,980 | 634 | 3.14 | % | ||||||
| Total interest-earning assets | 3,519,267 | 40,557 | 4.64 | % | 3,560,814 | 43,202 | 4.92 | % | ||||||
| Interest-bearing liabilities | ||||||||||||||
| Total interest-bearing demand and savings | 1,724,774 | 3,125 | 0.73 | % | 1,693,228 | 5,667 | 1.36 | % | ||||||
| Certificates of deposit | 806,734 | 3,739 | 1.86 | % | 1,016,369 | 5,063 | 2.02 | % | ||||||
| Total interest-bearing deposits | 2,531,508 | 6,864 | 1.09 | % | 2,709,597 | 10,730 | 1.61 | % | ||||||
| FHLB advances & LOC | 295,677 | 1,175 | 1.60 | % | 197,610 | 1,305 | 2.68 | % | ||||||
| Other borrowings | 59,626 | 423 | 2.85 | % | 71,882 | 528 | 2.98 | % | ||||||
| Total interest-bearing liabilities | 2,886,811 | 8,462 | 1.18 | % | 2,979,089 | 12,563 | 1.71 | % | ||||||
| Net interest income | $ | 32,095 | $ | 30,639 | ||||||||||
| Interest rate spread | 3.46 | % | 3.21 | % | ||||||||||
| Net interest margin ^(2)^ | 3.67 | % | 3.49 | % | ||||||||||
| ^(1)^ Average loan balances include nonaccrual loans. | ||||||||||||||
| ^(2)^ Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets for the period. | ||||||||||||||
| ^(3)^ Tax exempt income is not included in the above table on a tax-equivalent basis. | ||||||||||||||
| ^(4)^ Actual unrounded values are used to calculate the reported yield or rate disclosed. Accordingly, recalculations using the amounts in thousands as disclosed in this report may not produce the same amounts. | ||||||||||||||
| For the quarter ended | ||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||
| March 31, 2020 vs. 2019 | ||||||||||||||
| Total Increase/(Decrease) | ||||||||||||||
| Volume<br><br><br>Variance^(1)^ | Yield/Rate<br><br><br>Variance^(1)^ | Total<br><br><br>Variance | ||||||||||||
| Interest-earning assets | ||||||||||||||
| Loans | $ | (490 | ) | $ | (1,667 | ) | $ | (2,157 | ) | |||||
| Total securities | (75 | ) | (374 | ) | (449 | ) | ||||||||
| Federal funds sold and other | 30 | (69 | ) | (39 | ) | |||||||||
| Total interest-earning assets | (535 | ) | (2,110 | ) | (2,645 | ) | ||||||||
| Interest-bearing liabilities | ||||||||||||||
| Total interest-bearing demand and savings | 105 | (2,647 | ) | (2,542 | ) | |||||||||
| Certificates of deposit | (990 | ) | (334 | ) | (1,324 | ) | ||||||||
| Total interest-bearing deposits | (885 | ) | (2,981 | ) | (3,866 | ) | ||||||||
| FHLB advances & LOC | 504 | (634 | ) | (130 | ) | |||||||||
| Other borrowings | (37 | ) | (68 | ) | (105 | ) | ||||||||
| Total interest-bearing liabilities | (418 | ) | (3,683 | ) | (4,101 | ) | ||||||||
| Net interest income | $ | (117 | ) | $ | 1,573 | $ | 1,456 | |||||||
| ^(1)^The effect of changes in volume is determined by multiplying the change in volume by the previous year's average rate. Similarly, the effect of rate changes is calculated by multiplying the change in average rate by the prior year's volume. The changes attributable to both volume and rate, which cannot be segregated, have been allocated to the volume variance and the rate variance in proportion to the relationship of the absolute dollar amount of the change in each. |
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
TABLE 3. CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars in thousands)
| December 31, | |||||
|---|---|---|---|---|---|
| 2019 | |||||
| ASSETS | |||||
| Cash and due from banks | 141,989 | $ | 88,973 | ||
| Federal funds sold | 263 | 318 | |||
| Cash and cash equivalents | 142,252 | 89,291 | |||
| Interest-bearing time deposits in other banks | 2,498 | 2,498 | |||
| Available-for-sale securities | 187,812 | 142,067 | |||
| Held-to-maturity securities, fair value of 750,900 and 783,911 | 721,992 | 769,059 | |||
| Loans held for sale | 6,494 | 5,933 | |||
| Loans, net of allowance for loan losses of 21,915 and 12,232 | 2,485,208 | 2,544,420 | |||
| Other real estate owned, net | 5,870 | 8,293 | |||
| Premises and equipment, net | 84,732 | 84,478 | |||
| Bank-owned life insurance | 75,585 | 75,103 | |||
| Federal Reserve Bank and Federal Home Loan Bank stock | 31,662 | 31,137 | |||
| Interest receivable | 15,549 | 15,738 | |||
| Goodwill | 136,432 | 136,432 | |||
| Core deposit intangibles, net | 19,105 | 19,907 | |||
| Other | 28,641 | 25,222 | |||
| Total assets | 3,943,832 | $ | 3,949,578 | ||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||
| Deposits | |||||
| Demand | 508,441 | $ | 481,298 | ||
| Total non-interest-bearing deposits | 508,441 | 481,298 | |||
| Savings, NOW and money market | 1,668,145 | 1,749,048 | |||
| Time | 783,811 | 833,170 | |||
| Total interest-bearing deposits | 2,451,956 | 2,582,218 | |||
| Total deposits | 2,960,397 | 3,063,516 | |||
| Federal funds purchased and retail repurchase agreements | 37,113 | 35,708 | |||
| Federal Home Loan Bank advances | 389,620 | 324,373 | |||
| Bank stock loan | 40,000 | 8,990 | |||
| Subordinated debentures | 14,638 | 14,561 | |||
| Contractual obligations | 5,781 | 5,836 | |||
| Interest payable and other liabilities | 18,932 | 18,534 | |||
| Total liabilities | 3,466,481 | 3,471,518 | |||
| Commitments and contingent liabilities | |||||
| Stockholders’ equity | |||||
| Common stock | 174 | 174 | |||
| Additional paid-in capital | 383,850 | 382,731 | |||
| Retained earnings | 127,015 | 125,757 | |||
| Accumulated other comprehensive gain (loss) | 3,769 | (3 | ) | ||
| Employee stock loans | (43 | ) | (77 | ) | |
| Treasury stock | (37,414 | ) | (30,522 | ) | |
| Total stockholders’ equity | 477,351 | 478,060 | |||
| Total liabilities and stockholders’ equity | 3,943,832 | $ | 3,949,578 |
All values are in US Dollars.
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
TABLE 4. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollars in thousands, except per share data)
| Three months ended<br><br><br>March 31, | |||||
|---|---|---|---|---|---|
| 2020 | 2019 | ||||
| Interest and dividend income | |||||
| Loans, including fees | $ | 34,376 | $ | 36,533 | |
| Securities, taxable | 4,620 | 5,082 | |||
| Securities, nontaxable | 966 | 953 | |||
| Federal funds sold and other | 595 | 634 | |||
| Total interest and dividend income | 40,557 | 43,202 | |||
| Interest expense | |||||
| Deposits | 6,864 | 10,730 | |||
| Federal funds purchased and retail repurchase agreements | 31 | 32 | |||
| Federal Home Loan Bank advances | 1,175 | 1,305 | |||
| Bank stock loan | 109 | 162 | |||
| Subordinated debentures | 283 | 334 | |||
| Total interest expense | 8,462 | 12,563 | |||
| Net interest income | 32,095 | 30,639 | |||
| Provision for loan losses | 9,940 | 15,646 | |||
| Net interest income after provision for loan losses | 22,155 | 14,993 | |||
| Non-interest income | |||||
| Service charges and fees | 2,026 | 1,923 | |||
| Debit card income | 2,043 | 1,738 | |||
| Mortgage banking | 590 | 317 | |||
| Increase in value of bank-owned life insurance | 482 | 488 | |||
| Net gains (losses) from securities transactions | 8 | 6 | |||
| Other | 157 | 852 | |||
| Total non-interest income | 5,306 | 5,324 | |||
| Non-interest expense | |||||
| Salaries and employee benefits | 13,504 | 14,098 | |||
| Net occupancy and equipment | 2,235 | 1,967 | |||
| Data processing | 2,663 | 2,405 | |||
| Professional fees | 1,367 | 1,156 | |||
| Advertising and business development | 696 | 646 | |||
| Telecommunications | 487 | 585 | |||
| FDIC insurance | 517 | 278 | |||
| Courier and postage | 384 | 327 | |||
| Free nationwide ATM cost | 420 | 361 | |||
| Amortization of core deposit intangibles | 802 | 779 | |||
| Loan expense | 234 | 268 | |||
| Other real estate owned | 308 | 112 | |||
| Merger expenses | — | 639 | |||
| Other | 2,141 | 1,922 | |||
| Total non-interest expense | 25,758 | 25,543 | |||
| Income (loss) before income tax | 1,703 | (5,226 | ) | ||
| Provision for income taxes | 445 | (1,153 | ) | ||
| Net income (loss) and net income (loss) allocable to common stockholders | $ | 1,258 | $ | (4,073 | ) |
| Basic earnings (loss) per share | $ | 0.08 | $ | (0.26 | ) |
| Diluted earnings (loss) per share | $ | 0.08 | $ | (0.26 | ) |
Equity Bancshares, Inc.
PRESS RELEASE - 04/29/2020
TABLE 5. Non-GAAP Financial Measures (Unaudited)
(Dollars in thousands, except per share data)
| As of and for the three months ended | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||
| 2020 | 2019 | 2019 | 2019 | 2019 | |||||||||||
| Total stockholders' equity | $ | 477,351 | $ | 478,060 | $ | 467,050 | $ | 458,406 | $ | 453,463 | |||||
| Less: goodwill | 136,432 | 136,432 | 136,432 | 136,432 | 136,432 | ||||||||||
| Less: core deposit intangibles, net | 19,105 | 19,907 | 20,727 | 21,512 | 22,296 | ||||||||||
| Less: mortgage servicing asset, net | 4 | 5 | 7 | 8 | 10 | ||||||||||
| Less: naming rights, net | 1,163 | 1,174 | 1,184 | 1,195 | 1,206 | ||||||||||
| Tangible common equity | $ | 320,647 | $ | 320,542 | $ | 308,700 | $ | 299,259 | $ | 293,519 | |||||
| Common shares issued at period end | 15,198,986 | 15,444,434 | 15,440,334 | 15,563,873 | 15,820,303 | ||||||||||
| RSU shares vested | — | — | — | — | 108 | ||||||||||
| Common shares outstanding at period end | 15,198,986 | 15,444,434 | 15,440,334 | 15,563,873 | 15,820,411 | ||||||||||
| Diluted common shares outstanding at period end | 15,297,319 | 15,719,810 | 15,647,456 | 15,758,747 | 16,036,700 | ||||||||||
| Book value per common share | $ | 31.41 | $ | 30.95 | $ | 30.25 | $ | 29.45 | $ | 28.66 | |||||
| Tangible book value per common share | $ | 21.10 | $ | 20.75 | $ | 19.99 | $ | 19.23 | $ | 18.55 | |||||
| Tangible book value per diluted common share | $ | 20.96 | $ | 20.39 | $ | 19.73 | $ | 18.99 | $ | 18.30 | |||||
| Total assets | $ | 3,943,832 | $ | 3,949,578 | $ | 4,074,663 | $ | 4,180,074 | $ | 4,065,354 | |||||
| Less: goodwill | 136,432 | 136,432 | 136,432 | 136,432 | 136,432 | ||||||||||
| Less: core deposit intangibles, net | 19,105 | 19,907 | 20,727 | 21,512 | 22,296 | ||||||||||
| Less: mortgage servicing asset, net | 4 | 5 | 7 | 8 | 10 | ||||||||||
| Less: naming rights, net | 1,163 | 1,174 | 1,184 | 1,195 | 1,206 | ||||||||||
| Tangible assets | $ | 3,787,128 | $ | 3,792,060 | $ | 3,916,313 | $ | 4,020,927 | $ | 3,905,410 | |||||
| Total stockholders' equity to total assets | 12.10 | % | 12.10 | % | 11.46 | % | 10.97 | % | 11.15 | % | |||||
| Tangible common equity to tangible assets | 8.47 | % | 8.45 | % | 7.88 | % | 7.44 | % | 7.52 | % | |||||
| Total average stockholders' equity | $ | 482,567 | $ | 473,562 | $ | 463,252 | $ | 457,103 | $ | 459,713 | |||||
| Less: average intangible assets | 157,097 | 157,993 | 158,760 | 159,562 | 157,315 | ||||||||||
| Average tangible common equity | $ | 325,470 | $ | 315,569 | $ | 304,492 | $ | 297,541 | $ | 302,398 | |||||
| Net income (loss) allocable to common stockholders | $ | 1,258 | $ | 10,014 | $ | 10,406 | $ | 9,232 | $ | (4,073 | ) | ||||
| Amortization of intangible assets | 814 | 833 | 797 | 797 | 791 | ||||||||||
| Less: tax effect of intangible assets amortization | 171 | 175 | 167 | 167 | 166 | ||||||||||
| Adjusted net income (loss) allocable to common stockholders | $ | 1,901 | $ | 10,672 | $ | 11,036 | $ | 9,862 | $ | (3,448 | ) | ||||
| Return on total average stockholders' equity (ROAE) annualized | 1.05 | % | 8.39 | % | 8.91 | % | 8.10 | % | (3.59 | )% | |||||
| Return on average tangible common equity (ROATCE) annualized | 2.35 | % | 13.42 | % | 14.38 | % | 13.29 | % | (4.62 | )% | |||||
| Non-interest expense | $ | 25,758 | $ | 24,846 | $ | 24,223 | $ | 25,023 | $ | 25,543 | |||||
| Less: merger expenses | — | — | — | 276 | 639 | ||||||||||
| Non-interest expense, excluding merger expenses | $ | 25,758 | $ | 24,846 | $ | 24,223 | $ | 24,747 | $ | 24,904 | |||||
| Net interest income | $ | 32,095 | $ | 32,405 | $ | 31,526 | $ | 31,288 | $ | 30,639 | |||||
| Non-interest income | 5,306 | 6,641 | 6,572 | 6,451 | 5,324 | ||||||||||
| Less: net gains (losses) from securities transactions | 8 | (3 | ) | 4 | 7 | 6 | |||||||||
| Non-interest income, excluding gains (losses) from securities transactions | $ | 5,298 | $ | 6,644 | $ | 6,568 | $ | 6,444 | $ | 5,318 | |||||
| Net interest income plus non-interest income, excluding net gains (losses) from securities transactions | $ | 37,393 | $ | 39,049 | $ | 38,094 | $ | 37,732 | $ | 35,957 | |||||
| Non-interest expense to net interest income plus non-interest income | 68.87 | % | 63.63 | % | 63.58 | % | 66.31 | % | 71.03 | % | |||||
| Efficiency ratio | 68.88 | % | 63.63 | % | 63.59 | % | 65.59 | % | 69.26 | % |
eqbk-ex992_441.pptx.htm
First Quarter 2020 Results Presentation April 29, 2020 Exhibit 99.2
Disclaimers Special Note Concerning Forward-Looking Statements This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect the current views of Equity’s management with respect to, among other things, future events and Equity’s financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about Equity’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond Equity’s control. Accordingly, Equity cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although Equity believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from Equity’s expectations include COVID-19 related impacts; competition from other financial institutions and bank 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. The foregoing list of factors is not exhaustive. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in Equity’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 10, 2020, and any updates to those risk factors set forth in Equity’s subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if Equity’s underlying assumptions prove to be incorrect, actual results may differ materially from what Equity anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and Equity does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, such as COVID-19, and it is not possible for us to predict those events or how they may affect us. In addition, Equity cannot assess the impact of each factor on Equity’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Equity or persons acting on Equity’s behalf may issue. NON-GAAP FINANCIAL MEASURES This presentation contains certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of this presentation. Numbers in the presentation may not sum due to rounding.
Equity Bank: We Are Here For You - COVID Outreach 2020 Customers Colleagues Community Paycheck Protection Program - Began communicating with customers prior to applications opening Liquidity and action plans Deferrals where appropriate Increased focus on digital banking Full DocuSign Implementation Dispersed workforce appropriately Social distancing - at least 6 feet of distance for internal employees Work from home Employee Help Line Daily Communication from Management – video, social, intranet, and email Support for SBA Relief Programs Highlights in media, podcast Continued support of local sponsorships and causes Paycheck Protection Program Put on Express Track by Equity Bank from The Financial Brand https://thefinancialbrand.com/94930/coronavirus-covid19-paycheck-protection-program-ppp-cares-act-sba/
Equity Bank: We Are Here For You - COVID Outreach 2020 PPP CONTINUING TO ACCEPT APPLICATIONS TO FACILITATE PHASE 2 78,000(1) Employees Assisted through SBA PPP loans 1,600 Completed Loans (Pull Through Rate of 98%) Digital Banking DocuSign implementation across products Online & Mobile traffic +9% +50% New Account Applications Month-over-month Branch Light Knock or Call for lobby access drive-thru full service custom, in-house CRM project workflow Phase 1 (1) Estimate based on data provided on applications processed
Consumer RE Participants: 138 Amount: $28M COVID-19 RELIEF FOR CUSTOMERS Loan Payment Deferrals Deferral of principal & interest payments for a period of 90 to 180 days. Proactive communication with customer base to determine greatest need. Management team has worked directly with borrowers to identify additional solutions to weather the economic implications of COVID-19. As of the March 31, 2020, the Bank had granted payment deferrals to 129 customers on $122M in outstanding credit balances. As of April 20, 2020, the Bank had granted payment deferrals to 784 customers on $430M in outstanding credit balances, or 17% of the total portfolio. We are committed to continuing to partner with our customer base and providing valuable resources in working through the implications of the COVID-19 pandemic. Commercial Participants : 494 Amount: $400M As of April 20: Consumer Participants: 152 Amount: $2M
LOAN PORTFOLIO – CONCENTRATION
HOTEL PORTFOLIO Total exposure of $240M as of the end of the first quarter 2020. Currently low occupancy rates due to shelter-in-place orders associated with the COVID pandemic. Proactive communication with sophisticated borrowers has driven plans to conserve cash and fund operations. Based on measures taken, modeled to be able to support debt service capacity at less than 45% occupancy. No exposure to convention center anchored properties in the portfolio. The top 20 loans in the portfolio comprise $202M, or 84% of the exposure. The remainder of the portfolio is comprised of 73 loans averaging $526K. Comprised of proven hoteliers who have track records for operating capacity in challenging environments Well diversified geographically and primarily located in top MSA environments 61% of the exposure is to brands within the top five hotel portfolios (Hilton, Marriott, IHG) 33% of the exposure is to boutique brands (Archer, Hotel Indigo, and Woodspring Suites) Bank management is very knowledgeable of the portfolio and has direct industry experience. LTV = 54% Note: Dollars in Thousands, except as otherwise indicated.
AGRICULTURE PORTFOLIO Within our footprint crop yields have outperformed the average throughout the Midwest and nationwide. Approximately 59% of our portfolio is secured by real estate. Land values have seen very limited volatility in recent years. Throughout our footprint the Bank has experienced agricultural lenders who are proactively working with our borrower base to best position them for success in this environment. Note: Dollars in Thousands, except as otherwise indicated.
CONSTRUCTION PORTFOLIO The Bank has $222M in outstanding construction exposure The top 40 commercial construction relationships comprised 73% of the total portfolio, or $161M. 95% of these projects have not been interrupted by the impact of the pandemic. Two projects have been delayed as the impact of the pandemic is assessed. Two additional QSR projects have been completed, however opening has been delayed due to shelter-at-home orders in place. Completed projects as of March 31, 2020: Commercial – 18 projects - $25.3M Residential – 44 projects - $11.5M The residential construction portfolio is primarily custom build / spec homes to strong, seasoned builder developers which the Company has banked for a long period of time. The vacant land portfolio is comprised of 71 loans with an average balance of $159K. Note: Dollars in Thousands, except as otherwise indicated.
RESTAURANTS / RETAIL Restaurants – Portfolio Details – $96M: Predominantly QSRs in national concepts with Wichita roots, including Freddy’s, Papa John’s, and Pizza Hut (57%). Top tier quick service restaurant brands with national scale and the resources to innovate and command market share. Our borrowers are experienced owner-operators with proven performance. Principals provide personal guarantees and related loans are cross collateralized. Casual dining category includes restaurant brands such as Mr. Gatti’s Pizza and Old Chicago. The other category includes 86 loans with an average balance of $237K. QSRs – Resilience in Recessionary Periods: Historically have performed better than casual and sit down dining establishments in challenging economic times due to low cost nature for operators and consumers. Delivery and drive-thru capabilities position these restaurants to better weather the impacts of this pandemic and related social distancing efforts within their markets. Retail - $144M: Composed of consumer retail exposures as summarized in the chart to the right Shopping center exposure was $41M extended to 39 loan relationships. Vehicle – primarily comprised of vehicle dealerships diversified amongst our metro and community markets. Retail Stores / Amusement is comprised of 196 loans averaging $170K. Convenience stores is primarily comprised of gas station facilities. These entities have not been as significantly impacted by the pandemic response as they are considered essential. Note: Dollars in Thousands, except as otherwise indicated.
C&I MANUFACTURING PORTFOLIO The total manufacturing portfolio was $131.7M as of March 31. Aerospace exposure within the portfolio was $62.9M or 48%. Six borrowers comprise the aerospace segment of our portfolio. Original projected revenues for 2020 associated with the Boeing 737 Max for these companies ranged from 15-50%. These operators are highly experienced in the industry and committed to making operational changes as necessary. Management has proactively communicated with each of these borrowers. The companies have solid balance sheets, good liquidity, and access to additional capital, if needed. The non-aerospace component of the portfolio is comprised of 120 loans with an average balance of $573K and well diversified in a variety of lines of business and geographically throughout our footprint. Note: Dollars in Thousands, except as otherwise indicated.
SYNDICATED NATIONAL CREDITS Diversified portfolio based on operating segment including technology, hospitality, restaurants, and logistics. The Company has reduced our exposure in these credits year-over-year from as high as $63M in June 2019.
MULTIFAMILY PORTFOLIO Total Multi-family exposure within the portfolio is $85M. Comprised of 93 loans with an average balance of approximately $915K. Included within the portfolio is $9.5M in loans facilitating operations of low to moderate income apartment complexes. $12.7M of the portfolio is currently under construction, the remainder is operating space. Note: Dollars in Thousands, except as otherwise indicated.
OIL AND GAS / MEDICAL / ASSISTED LIVING The Bank has very limited exposure to the oil and gas industry and no direct exposure to exploration. Total balance of $19M as of March 31, 2020, which is comprised of 59 loans with an average balance of $325K. The Bank has very limited exposure to the medical / healthcare industry. Total balance of $15M as of March 31, 2020. The Bank has very limited exposure to the assisted living industry. Total balance of $15M as of March 31, 2020. There have been no incidents of COVID reported within the portfolio. OIL & GAS MEDICAL ASSISTED LIVING
Diluted earnings per share of $0.08 for 1Q 2020 Net income to common stockholders was $1.3 million Pre-tax, pre-provision income was $11.6 million EQBK Capital Ratios as of 3/31/2020: Leverage Ratio of 9.02% Total Risk-Based Capital Ratio of 13.00% Tangible Common Equity to Tangible Assets of 8.47%(1) Tangible common book value per share of $21.10(1) Provision for loan losses was driven higher by economic uncertainty due to the COVID-19 pandemic Realized NIM expansion Y/Y and Q/Q to 3.67% for Q1 Completed share repurchases of 295,461 during the quarter. Remaining shares authorized to be repurchased were 383,523 as of quarter end. In March, in response to the COVID-19 environment, the Board of Directors voted to temporarily suspend the repurchase program. 2020 First Quarter Highlights Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Proactive response to the COVID-19 pandemic for the benefit of our customers, personnel, communities, and shareholders. Realized net interest margin expansion in a challenging, rates down environment. Continued to enhance enterprise value, through developing strong relationships with current and future customers as we all work to determine and address the impacts of the current environment.
Operating Performance Trends – Year-over-Year Diluted EPS and Net Income to Common Stockholders Return on Average Tangible Common Equity(1,2) Efficiency Ratio(1,2) & Non-Interest Expense / Average Assets Income(2) and Net Interest Margin Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Does not include gains on sales and settlement of securities or bargain purchase gains associated with acquisitions. 2019 results adjusted for merger expenses, first quarter identified specific impairment charge, and FDIC premium credit received in the third quarter. First quarter 2020 results adjusted to exclude additional provisioning as a response to COVID-19 economic uncertainty ($9.94M). (3) (3)
Operating Performance Trends – Quarter-over-Quarter Diluted EPS and Net Income to Common Stockholders Return on Average Tangible Common Equity(1,2) Efficiency Ratio(1,2) & Non-Interest Expense / Average Assets Income(2) and Net Interest Margin (3) (3) Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Does not include gains on sales and settlement of securities. 2019 results adjusted for merger expenses, first quarter identified specific impairment charge, and FDIC premium credit received in the third quarter. First quarter 2020 results adjusted to exclude additional provisioning as a response to COVID-19 economic uncertainty ($9.94M).
Interest Income & Net Interest Margin Performance Notes: Improved interest margin through proactive management of liability costs. (1) (1) Includes Non-interest bearing deposits
Margin Dynamic EQBK begins raising deposit rates, with a focus on locking in time deposits at fixed rates to get ahead of the curve. 6/30 – 12/31/18 – EQBK reduced exposure to FHLB advances by $275M from $600M to $325M as market rates continued to rise. Quarter Prod: Fixed – 54% Variable – 46% ; 78% with floor
Non-Interest Income Does not include gains on sales and settlement of securities. Performance Notes: Continued strong performance in service income generation, increases in each category as compared to the same period last year. Quarter over quarter reduction in service fees reflects reductions in customer fees as we all work through the current economic uncertainty. Reduction in ‘Other’ is primarily due to the fair valuation change in derivative contracts held by the Bank. The reduction in value is expected to be recovered over the life of the contracts.
Non-Interest Expense Performance Notes: Specific expense categories are flat to declining Q/Q, with the exception of compensation Q/Q increase in compensation is based on timing of certain payroll driven costs realized as well as incentive compensation reductions that occurred in Q4 2019. Excluding additional provisioning of $900K for OREO assets associated with the economic uncertainty, expense decreased by $46M Y/Y. Does not include merger expenses.
Tangible Book Value Tangible Book Value per Share(1) and Total Assets TBV CAGR 2016 - 1Q 2020: 7.58% Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation.
Capital Position Over Time IPO * Paid off Series C preferred stock in January 2016 Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. (1)
Total Loans by Purpose(1) Gross Total Loans ($000s) $2,575,408 $2,556,652 $1,383,605 $2,117,270 Year-to-Date Loan Yield 4.98% 5.43% 5.74% 5.73% $2,507,123 5.47% For financial statement reporting, management considers other factors in addition to purpose when assessing risk and identifying reporting classes. As such, the above is not intended to reconcile to the company’s loan disclosures within the applicable financial statement.
Allowance for Loan Losses As provided for in the CARES Act, the Company elected to defer CECL implementation in favor of the historic probable, incurred methodology. The Company was prepared to implement the standard prior to the emergence of this pandemic. The primary driver of the decision was comparability of results and familiarity with the current process allowing the Company to focus on best serving our customers, community, people, and stockholders. The Company also took into consideration the level of uncertainty related to the economic forecast period, the lack of usable forecasting data available for a similar event on a worldwide scale, the level of variability in the possible outcomes tied to duration of the economic event and how effective the governmental response to the economic event would be, in reaching our decision to utilize the historic, proven methodology. During the first quarter of 2020, the Company recorded a $9.94M provision for loan loss to account for the additional uncertainty and risk associated with the current economic environment through adjustment of our qualitative factors within the probable, incurred methodology. In assessing the additional reserve, the Company analyzed Equity Bank and peer performance during the peak of the Great Recession and, ultimately, reserved for the highest single year loss experienced by the Company over that period. While management does not believe the current economic uncertainty will necessarily mirror the Great Recession, we believe it provided the best quantitative base for our qualitative reserve.
Asset Quality – Year-over-Year Nonperforming Assets 1.43% NPAs / Assets 1.52% Net Charge-Offs (NCO)/ Average Loans $1.19 $0.89 NCO ($ in millions) Nonaccrual Detail Classified Assets to Total Regulatory Capital $1.01 0.98% 1.22% $0.26 68.5% 75.9% Purchased impaired loans classified as non-accrual that are current 37.3% 1.19% $17.58 Adjusted to exclude impact of credit specifically identified in March 31, 2019 Form 10-Q. Impact of credit specifically identified in March 31, 2019 Form 10-Q. Includes loans 90+ days past due and other repossessed assets which are not highlighted in the table. $2.40(1) (3) 62.5%
Asset Quality – Quarter-over-Quarter Nonperforming Assets 1.91% NPAs / Assets 1.61% Net Charge-Offs (NCO)/ Average Loans $6.70 $0.76 NCO in $ ($ in millions) Nonaccrual Detail Classified Assets to Total Regulatory Capital $9.54 1.40% 1.22% $0.26 37.3% 45.7% Purchased impaired loans classified as non-accrual that are current 62.5% 1.19% $0.58 Adjusted to exclude impact of credit specifically identified in March 31, 2019 Form 10-Q. No impact on March 31, 2020 period. Impact of credit specifically identified in March 31, 2019 Form 10-Q. Includes loans 90+ days past due and other repossessed assets which are not highlighted in the table. $0.30(1) 54.6% 59.9% $0.21(1) $1.70 (1) (3) $0.19(1)
Bank Owned Life Insurance Portfolio consists of insurance companies with a long and proven history of providing bank owned life insurance products. As of their most recently available financial statements, each of these providers showed significant capital, surplus, and asset valuation reserves. Each of the service providers utilized carries an investment grade credit rating from either or both Moody’s and S&P. Our two largest providers, 80% of the asset value, carry Comdex scores of 98 or greater.
Total Deposits Total ($000s) $3,123,447 $3,063,516 $1,630,451 $2,382,013 Year-to-Date Cost of Deposits* 0.56% 0.68% 0.96% 1.30% * Includes interest and non-interest bearing deposits. $2,960,397 0.91%
Appendix
Selected Income Statement Data Selected Income Statement Data ($000s) YTD 03/31/20 12/31/19 12/31/18 12/31/17 12/31/16 12/31/14 2013 Interest income $40,557 $,175,499 $,161,556 $,102,693 $61,799 $46,794 $46,845 Interest expense 8462 49641 36758 16691 9202 5433 5610 Net interest income 32095 125858 124798 86002 52597 41361 41235 Provision for loan losses 9940 18354 3961 2953 2119 1200 2583 Net interest income after provision 22155 107504 120837 83049 50478 40161 38652 Other income 5306 24988 19725 15440 10466 8674 7892 Other expense 25758 99635 94387 67463 47075 35645 35137 Income (loss) before income taxes 1703 32857 46175 31026 13869 13190 11407 Income taxes 445 7278 10350 10377 4495 4203 3534 Net income (loss) 1258 25579 35825 20649 9374 8987 7873 Less: dividends and discount accretion on preferred stock 0 0 0 0 1 708 978 Net income (loss) allocable to common stockholders $1,258 $25,579 $35,825 $20,649 $9,373 $8,279 $6,895
Selected Balance Sheet Data Demonstrating balance sheet strength Includes interest-bearing deposits in other banks. Includes Federal Reserve Bank and Federal Home Loan Bank stock. Includes loans held-for-sale. Selected Balance Sheet Data ($000s) ASSETS 12/31/14 03/31/20 12/31/19 12/31/18 12/31/17 12/31/16 Cash and cash equivalents (1) $37,702 $,144,750 $91,789 $,197,809 $55,691 $38,845 Investment securities (2) 318314 941466 942263 946445 722107 578093 Net loans(3) 720810 2491702 2550353 2566926 2111125 1382003 Other assets 97689 365914 365173 350536 281586 193251 Total assets $1,174,515 $3,943,832 $3,949,578 $4,061,716 $3,170,509 $2,192,192 LIABILITIES & STOCKHOLDERS' EQUITY Deposits $,981,177 $2,960,397 $3,063,516 $3,123,447 $2,382,013 $1,630,451 Borrowings 70370 481371 383632 464676 401652 293909 Other liabilities 5239 24713 24370 17652 12700 9868 Total liabilities 1056786 3466481 3471518 3605775 2796365 1934228 Stockholders' Equity 117729 477351 478060 455941 374144 257964 Total liabilities and stockholders' equity $1,174,515 $3,943,832 $3,949,578 $4,061,716 $3,170,509 $2,192,192
Capitalization (1) Total common equity less goodwill and intangibles divided by shares outstanding as of period end. Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Maintaining a strong regulatory capital position Ratio 12/31/14 03/31/20 12/31/19 12/31/18 12/31/17 12/31/16 Leverage Ratio 9.6199999999999994E-2 9.0200000000000002E-2 9.0200000000000002E-2 8.5999999999999993E-2 0.1033 0.1181 Tier 1 Risk-Based Capital Ratio 0.13159999999999999 0.122 0.1215 0.1145 0.12139999999999999 0.14280000000000001 Total Risk-Based Capital Ratio 0.1386 0.13 0.12590000000000001 0.1186 0.12509999999999999 0.14710000000000001 Common Equity Tier 1 Capital to Risk Weighted Assets NA 0.1167 0.1163 0.1095 0.1153 0.1338 Tangible Book Value per Common Share(1) $13.54 $21.1 $20.75 $19.079999999999998 $17.61 $16.64
The subsequent tables present non-GAAP reconciliations of the following calculations: Tangible Common Equity (TCE) to Tangible Assets (TA) Ratio Tangible Book Value per Common Share Return on Average Tangible Common Equity (ROATCE) Efficiency Ratio
TCE to TA and Tangible Book Value per Share As of and for the years ended Non-GAAP Financial Measures (Unaudited) (Dollars in thousands, except per share data) YTD March 31, 2020 December 31, 2019 December 31, 2018 December 31, 2017 December 31, 2016 December 31,2012 Total stockholders’ equity $,477,351 $,478,060 $,455,941 $,374,144 $,257,964 $,138,169 Less: goodwill ,136,432 ,136,432 ,131,712 ,104,907 58,874 18,130 Less: core deposit intangibles, net 19,105 19,907 21,725 10,738 4,715 1,957 Less: mortgage servicing asset, net 4 5 11 17 23 Less: naming rights, net 1,163 1,174 1,217 1,260 0 0 Tangible common equity $,320,647 $,320,542 $,301,276 $,257,222 $,194,352 $86,198 Common shares outstanding at period end (1) 15,198,986 15,444,434 15,793,095 14,605,607 11,680,308 7,431,513 Book value per common share (1) $31.406766214535629 $30.953546112470033 $28.869642080922077 $25.61646359511111 $22.085376515756259 $14.301932863469389 Tangible book value per common share (1) $21.096604734026336 $20.75453202105043 $19.076438152243114 $17.611181787925695 $16.639287251671785 $11.598983948490705 Total assets $3,943,832 $3,949,578 $4,061,716 $3,170,509 $2,192,192 $1,188,850 Less: goodwill ,136,432 ,136,432 ,131,712 ,104,907 58,874 18,130 Less: core deposit intangibles, net 19,105 19,907 21,725 10,738 4,715 1,957 Less: mortgage servicing asset, net 4 5 11 17 23 Less: naming rights, net 1,163 1,174 1,217 1,260 0 0 Tangible assets $3,787,128 $3,792,060 $3,907,051 $3,053,587 $2,128,580 $1,168,763 Tangible common equity to tangible assets 8.4667589793637824E-2 8.4529780646930688E-2 7.7110843958781192E-2 8.4236014890029326E-2 9.1305941049901806E-2 7.3751479127932701E-2 (1) Share and per share data includes Class A and Class B common stock issued and outstanding and vested, but unissued RSU shares. Non-GAAP Financial Measures, continued (Unaudited) As of and for the three months ended As of and for the three months ended As of and for the three months ended As of and for the three months ended (Dollars in thousands, except per share data) March 31, 2017 March 31, 2017 March 31, 2017 March 31, 2016 December 31,2012 Total average stockholders' equity $,264,736 $,264,736 $,264,736 $,153,929 $,102,032 Less: average intangible assets and preferred stock 65,185 65,185 65,185 20,616 33,653 Average tangible common equity (1) (3) $,199,551 $,199,551 $,199,551 $,133,313 $68,379 Net income allocable to common stockholders (1) 4,864 4,864 4,864 3,439 3,814 Amortization of core deposit intangible 218 218 218 87 192 Less: tax effect of amortization of core deposit intangible (2) -76 -76 -76 -30 -65 Adjusted net income allocable to common stockholders $5,006 $5,006 $5,006 $3,496 $3,941 Return on average tangible common equity (ROATCE) 0.10173895951967722 0.10173895951967722 0.10173895951967722 0.10547234826937482 5.7634653914213428E-2 Non-interest expense $15,226 $15,226 $15,226 $9,689 $22,900 Less: merger expenses 926 926 926 0 1,519 Less: loss on debt extinguishment 0 0 0 58 0 Non-interest expense, excluding merger expenses and loss on debt extinguishment $14,300 $14,300 $14,300 $9,631 $21,381 Net interest income $19,893 $19,893 $19,893 $12,758 $25,570 Non-interest income $3,339 $3,339 $3,339 $2,697 $4,826 Less: net gains on sales and settlement of securities 13 13 13 420 3 Less: net gain on acquisition 0 0 0 0 0 Non-interest income, excluding net gains on sales and settlement of securities and net gain on acquisition $3,326 $3,326 $3,326 $2,277 $4,823 Efficiency ratio 0.61587493001421245 0.61587493001421245 0.61587493001421245 0.64057199866977055 0.70348435495015305 ____________________ (1) Share and per share data includes Class A and Class B common stock issued and outstanding (2) Tax rates used in this calculation were 35% for 2015 and 2014 and 34% for 2013, 2012, and 2011 (3) All periods disclosed were calculated using a simple average of tangible common equity
ROATCE and Efficiency Ratio Non-GAAP Financial Measures (Unaudited) Years Ended December 31, (Dollars in thousands, except per share data) Mar. 2018 Mar. 2018 2017 2016 Total stockholders’ equity $,381,487 $,381,487 $,374,144 $,257,964 Less: preferred stock 0 0 0 0 Less: goodwill ,103,412 ,103,412 ,104,907 58,874 Less: core deposit intangibles, net 10,355 10,355 10,738 4,715 Less: mortgage servicing asset, net 16 16 17 23 Less: naming rights, net 1,249 1,249 1,260 0 Tangible common equity $,266,455 $,266,455 $,257,222 $,194,352 Common shares outstanding at period end (1) 14,621,258 14,621,258 14,605,607 11,680,308 Book value per common share $26.091256990335577 $26.091256990335577 $25.61646359511111 $22.085376515756259 Tangible book value per common share $18.223808101874681 $18.223808101874681 $17.611181787925695 $16.639287251671785 Total assets $3,176,062 $3,176,062 $3,170,509 $2,192,192 Less: goodwill ,103,412 ,103,412 ,104,907 58,874 Less: core deposit intangibles, net 10,355 10,355 10,738 4,715 Less: mortgage servicing asset, net 16 16 17 23 Less: naming rights, net 1,249 1,249 1,260 0 Tangible assets $3,061,030 $3,061,030 $3,053,587 $2,128,580 Tangible common equity to tangible assets 8.7047497084314751E-2 8.7047497084314751E-2 8.4236014890029326E-2 9.1305941049901806E-2 (1) Share and per share data includes Class A and Class B common stock issued and outsanding (2) Tax rates used in this calculation were 35% (3) All periods disclosed, except 2018, 2017 and 2016, were calculated using a simple average of tangible common equity Non-GAAP Financial Measures, continued (Unaudited) As of and for the years ended (Dollars in thousands, except per share data) YTD March 31, 2020 December 31, 2019 December 31, 2018 December 31, 2017 December 31, 2016 Total average stockholders' equity $,482,567 $,463,445 $,420,453 $,293,798 $,168,822 Less: average intangible assets and preferred stock ,157,097 ,158,410 ,139,131 76,320 25,883 Average tangible common equity $,325,470 $,305,035 $,281,322 $,217,478 $,142,939 Net income allocable to common stockholders $1,258 $25,579 $35,825 $20,649 $9,373 Amortization of intangibles 814 3,218 2,492 1,070 419 Less: tax effect of amortization of intangibles (1) 171 676 523 375 147 Adjusted net income allocable to common stockholders $1,901 $28,121 $37,794 $21,344 $9,645 Return on average tangible common equity (ROATCE) (2) 2.3491505268627585E-2 9.2189420886127818E-2 0.13434427453238637 9.8143260467725466E-2 6.7476336059437939E-2 Non-interest expense $25,758 $99,635 $94,387 $67,463 $47,075 Less: merger expenses 0 915 7,462 5,352 5,294 Less: loss on debt extinguishment 0 0 0 0 58 Non-interest expense, excluding merger expenses and loss on debt extinguishment $25,758 $98,720 $86,925 $62,111 $41,723 Net interest income $32,095 $,125,858 $,124,798 $86,002 $52,597 Non-interest income $5,306 $24,988 $19,725 $15,440 $10,466 Less: net gains (losses) from securities transactions 8 14 -9 271 479 Non-interest income, excluding net gains (losses) from securities transactions and net gain on acquisition $5,298 $24,974 $19,734 $15,169 $9,987 Efficiency ratio 0.6888455058433397 0.65450302323114462 0.60142390612459529 0.61392098526257521 0.66667199284162082 ____________________ (1) Tax rates used in this calculation were 21% for 2020, 2019 and 2018. Tax rates used were 35% for previous years. (2) Annualized
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