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 27, 2020
 
FB FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)

Tennessee
 
001-37875
 
62-1216058
(State or other jurisdiction
of incorporation)
 
(Commission File Number)
 
(IRS Employer
Identification Number)
 
 
 
 
 
211 Commerce Street, Suite 300
Nashville, Tennessee
 
 
 
 
37201
(Address of principal executive offices)
 
 
 
(Zip Code)
 
(615) 564-1212
(Registrant’s telephone number, including area code)

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 ( see General Instruction A.2. below):
☐ 
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
Trading Symbol(s)
Name of each exchange on which registered
common stock, $1.00 par value
FBK
New York Stock Exchange
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 ý
 
 
 
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. ý
 






Item 2.02 Results of Operations and Financial Condition.

On April 27, 2020, FB Financial Corporation (the “FB Financial”) issued a press release announcing its financial results for the first quarter ended March 31, 2020 (the “Earnings Release”). In addition, the Company made available on its website (investors.firstbankonline.com) supplemental financial information for the first quarter ended March 31, 2020 (the “Supplemental Financial Information”) and an earnings release presentation (the “Earnings Presentation”) for use in connection with the Earnings Release. Copies of the Earnings Release, the Supplemental Financial Information and the Earnings Presentation are furnished as Exhibit 99.1, Exhibit 99.2 and Exhibit 99.3, respectively, to this current report on Form 8-K (this “Report”).

The information contained in this Report, including Exhibit 99.1, Exhibit 99.2 and Exhibit 99.3 furnished herewith, 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 the liabilities under that section, nor shall it be deemed incorporated by reference into any registration statement or other documents pursuant to the Securities Act of 1933, as amended, or into any filing or other document pursuant to the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 7.01. Regulation FD Disclosure.

The disclosure contained in Item 2.02 of this Report is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

Exhibit Number                                          Description of Exhibit






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 hereunto duly authorized.
 
 
 
FB FINANCIAL CORPORATION
 
 
 
 
 
 
 
By:
/s/ Michael M. Mettee
 
 
Michael M. Mettee
 
 
Interim Chief Financial Officer
 
 
 
Date: April 27, 2020
 
 





fb_suppa01.jpg
FB Financial Corporation Reports First Quarter 2020 Results
Reported net income of $0.7 million, or diluted EPS of $0.02, reflecting the impact of COVID-19 pandemic
Adjusted PTPP earnings* were $33.4 million for the first quarter, up 8.1% from Q4 2019
Adopted CECL increasing ACL by $30.9 million
Recorded provisions for credit losses of $29.6 million; building ACL to 1.95% of loans HFI

NASHVILLE, TENNESSEE--(BUSINESS WIRE)--April 28, 2020--FB Financial Corporation (the “Company”) (NYSE: FBK), parent company of FirstBank, reported net income of $0.7 million, or $0.02 per diluted common share, for the first quarter of 2020, compared to net income of $19.6 million, or $0.62 per diluted common share, for the first quarter of 2019. Following the adoption of CECL, the forecasted impact of COVID-19 pandemic crisis resulted in provisions for credit losses and unfunded commitments totaling $29.6 million in the first quarter compared to $3.0 million in the fourth quarter of 2019 and $1.4 million in the first quarter of 2019. The Company reported adjusted pre-tax, pre-provision ("PTPP") earnings of $33.4 million this quarter, reflecting increases of 8.1% and 16.8% from $30.9 million and $28.6 million in the first and fourth quarters of 2019, respectively.
President and Chief Executive Officer, Christopher T. Holmes stated, “The first quarter of 2020 will be remembered as a defining time for our Company. Our associates responded to the challenges of tornadoes devastating our middle Tennessee market and the COVID-19 pandemic by taking care of each other and our customers in ways that showed true courage and compassion. Over the last five weeks, we have approved and funded over 1,500 Paycheck Protection Program (PPP) loans totaling $267.0 million for small businesses, preserving jobs for approximately 29,000 employees in our communities. Additionally, we reached out to our customers and deferred loan payments for over 1,400 consumer and businesses totaling $680.0 million. I have been amazed by the performance and have never been more proud to be part of the FirstBank team.”
Holmes commented further, “In addition to responding to these challenges, we positioned the Company for the road ahead by reinforcing an already strong balance sheet with increased liquidity, increased credit reserves and solid capital positions. We also completed our merger with Farmers National Bank of Scottsville (KY) ("Farmers National") and announced our pending merger with Franklin Financial Network, Inc. We have continued our integration and conversion plans for Farmers National, which we plan to convert later this quarter, and Franklin Financial, which we believe is on track for closing during the third quarter of this year.”
Performance Summary
 
 
2020
 
2019
 
Annualized
 
 
(dollars in thousands, expect per share data)
 
First Quarter
 
Fourth Quarter
 
First Quarter
 
1Q20 / 4Q19
% Change
 
1Q20 / 1Q19
% Change
Balance Sheet Highlights
 
 
 
 
 
 
 
 
 
 
     Investment securities
 
$
767,575

 
$
691,676

 
$
670,835

 
44.1
%
 
14.4
 %
     Loans - held for sale
 
325,304

 
262,518

 
248,054

 
96.2
%
 
31.1
 %
     Loans - held for investment (HFI)
 
4,568,038

 
4,409,642

 
3,786,791

 
14.4
%
 
20.6
 %
     Allowance for credit losses
 
89,141

 
31,139

 
29,814

 
749.2
%
 
199.0
 %
     Total assets
 
6,655,687

 
6,124,921

 
5,335,156

 
34.9
%
 
24.8
 %
     Customer deposits
 
5,356,569

 
4,914,587

 
4,242,349

 
36.2
%
 
26.3
 %
     Brokered and internet time deposits
 
20,363

 
20,351

 
60,842

 
0.24
%
 
(66.5
)%
     Total deposits
 
5,376,932

 
4,934,938

 
4,303,191

 
36.0
%
 
25.0
 %
     Borrowings
 
327,822

 
304,675

 
229,178

 
30.6
%
 
43.0
 %
     Total shareholders' equity
 
782,330

 
762,329

 
694,577

 
10.6
%
 
12.6
 %
Tangible book value per share*
 
$
18.35

 
$
18.55

 
$
17.73

 
 
 
 
Tangible common equity to tangible assets*
 
9.11
%
 
9.69
%
 
10.5
%
 
 
 
 
* Certain measures are considered non-GAAP financial measures. See “Use of non-GAAP Financial Measures” and the corresponding non-GAAP reconciliation tables in the
      Supplemental Financial Information, which accompanies this Earnings Release, as well as “Use of non-GAAP Financial Measures” and the Appendix in the Earnings Release
      Presentation issued April 27, 2020 for a reconciliation and discussion of this non-GAAP measure.



FB Financial Corporation
First Quarter 2020 Results
Page 2

 
 
2020
 
2019
(dollars in thousands, except share data)
 
First Quarter
 
Fourth Quarter
 
First Quarter
Results of operations
 
 
 
 
 
 
Net interest income
 
$
56,249

 
$
57,692

 
$
53,016

      NIM
 
3.92
%
 
4.12
%
 
4.61
%
Provisions for credit losses
 
$
29,565

 
$
2,950

 
$
1,391

     Net charge-off ratio
 
0.19
%
 
0.30
%
 
0.06
%
Noninterest income
 
$
42,700

 
$
35,234

 
$
29,039

     Mortgage banking income
 
$
32,745

 
$
26,176

 
$
21,021

Total revenue
 
$
98,949

 
$
92,926

 
$
82,055

Noninterest expenses
 
$
68,559

 
$
62,686

 
$
55,101

     Merger and mortgage restructuring expenses
 
$
3,050

 
$
686

 
$
621

     Efficiency ratio
 
69.3
%
 
67.5
%
 
67.2
%
     Core efficiency ratio*
 
65.7
%
 
66.5
%
 
64.9
%
Adjusted pre-tax, pre-provision earnings*
 
$
33,440

 
$
30,926

 
$
28,629

    Total adjusted mortgage banking pre-tax contribution*
 
$
8,019

 
$
3,010

 
$
727

Net income
 
$
745

 
$
21,572

 
$
19,588

Diluted earnings per share
 
$
0.02

 
$
0.68

 
$
0.62

     Effective tax rate
 
9.70
%
 
21.0
%
 
23.4
%
Weighted average number of shares outstanding- fully diluted
 
31,734,112

 
31,470,565

 
31,349,198

Actual shares outstanding - period end
 
32,067,356

 
31,034,315

 
30,852,665

Returns on average:
 
 
 
 
 
 
As reported
 
 
 
 
 
 
     Assets ("ROAA")
 
0.05
%
 
1.39
%
 
1.54
%
     Equity ("ROAE")
 
0.39
%
 
11.2
%
 
11.6
%
     Tangible common equity ("ROATCE")*
 
0.52
%
 
14.9
%
 
14.8
%
Adjusted pre-tax, pre-provision
 
 
 
 
 
 
      Assets*
 
2.10
%
 
1.99
%
 
2.24
%
      Equity*
 
17.5
%
 
16.1
%
 
17.0
%
      Tangible common equity*
 
23.2
%
 
21.3
%
 
21.6
%
* Certain measures are considered non-GAAP financial measures. See "Use of non-GAAP Financial Measures" and the corresponding non-GAAP reconciliation tables in the Supplemental Financial Information, which accompanies this Earnings Release, as well as "Use of non-GAAP Financial Measures" and the Appendix in the Earnings Release Presentation issued April 27, 2020, for a reconciliation and discussion of this non-GAAP measure.


Controlled Loan Growth; While Building Liquidity
The Company grew loans (HFI) by $158.4 million to $4.57 billion during the first quarter of 2020, or 14.4% annualized, while average loans (HFI) increased 10.2% annualized from last quarter, including $175.4 million from the Farmers National merger. Organic loan growth was lower than expected this quarter and was impacted by unexpected prepayments early in the quarter and the pandemic crisis later in the quarter. Contractual loan yields decreased from 5.27% in the fourth quarter to 5.14% in the first quarter, reflecting the impact of the lower interest rate environment.
During the first quarter of 2020, the Company grew deposits by $442.0 million to $5.38 billion, reflecting annualized quarterly growth of 36.0% and year over year growth of 25.0%, including $209.5 million from the Farmers National merger and an increase of $109.6 million in mortgage servicing related and wholesale/other deposits. The Company reduced its cost of deposits this quarter to 0.94% from 1.02% in the fourth quarter of 2019. Loans (HFI) to deposits decreased to 85.0% this quarter from 89.4% last quarter.
Additionally, during the quarter, investment securities increased $75.9 million to $767.6 million, or 11.5% of total assets, primarily from $50.6 million of investments acquired with Farmers National. Additionally, cash and cash equivalents increased $192.4 million to $425.1 million in light of the ongoing crisis to bolster the Company's overall liquidity.
The Company’s net interest income for the quarter was $56.2 million, representing a decrease from $57.7 million last quarter and an increase from $53.0 million for the first quarter of 2019. The Company’s net interest margin (“NIM”) was 3.92% for the first quarter of 2020, compared to 4.12% and 4.61% for the fourth quarter of 2019 and the first quarter of 2019, respectively. Accretion related to purchased loans and nonaccrual interest contributed 13 basis points to the NIM in the first quarter of 2020 compared to 21 and 17 basis points for the fourth quarter of 2019 and the first quarter of 2019, respectively. Overall, the NIM for the first quarter of 2020 was impacted by a 27 basis point decline in the yield on interest-earning assets offset by a 11 basis point decline in the


FB Financial Corporation
First Quarter 2020 Results
Page 3

rate on interest-bearing liabilities over last quarter. Additionally, the increases in liquidity positions negatively impacted the NIM as yields were lower during the quarter on excess cash equivalents.
Holmes commented, “Our net interest margin was stable over the first two months of the quarter, but the 150 basis point cuts in March compressed our net interest margin. We expect the margin to decline in the second quarter as the interest rate cuts are fully reflected. We will continue repricing deposits in the coming months, with particular focus on maturing time deposits. reflecting the new interest rate environment.”
Noninterest Income Benefits from Mortgage Production
Noninterest income was $42.7 million for the first quarter of 2020, compared to $35.2 million for the fourth quarter of 2019 and $29.0 million for the first quarter of 2019. Mortgage banking income was $32.7 million for the first quarter of 2020, compared to $26.2 million for the fourth quarter of 2019 and $21.0 million for the first quarter of 2019.
During the quarter, the Company produced unseasonably strong results from the mortgage business driven by the lower interest rate environment. Interest rate lock commitment volume totaled $2.09 billion in the first quarter of 2020 compared to $1.08 billion in the fourth quarter of 2019 and $1.36 billion in the first quarter of 2019.
During the first quarter of 2020, the Company’s total mortgage pre-tax direct contribution was $8.0 million, compared to the $3.0 million contribution in the fourth quarter of 2019 and $0.7 million in the first quarter of 2019.
Holmes commented, “Our mortgage operations are benefiting from the current interest rate environment through strong refinance volumes as well as new purchase originations. We continue monitoring the overall liquidity of the mortgage markets and activities by the federal housing agencies on our servicing portfolio during these times of changing interest rates and volatile markets.”
Noninterest Expenses
Noninterest expense was $68.6 million for the first quarter of 2020, compared to $62.7 million for the fourth quarter of 2019 and $55.1 million for the first quarter of 2019. On an adjusted basis, noninterest expense was $65.5 million for the first quarter of 2020, $62.0 million for the fourth quarter of 2019, and $53.4 million for the first quarter of 2020. The linked quarter increase is primarily related to increased mortgage commissions and related expenses, typical first quarter employee benefit costs, and the addition of Farmers National during the quarter.
Holmes noted, “Noninterest expenses continue to reflect our disciplined and thoughtful approach as we continue balancing profitability, investment decisions and capital efficiency during these uncertain times.”
Asset Quality
Upon adoption of CECL effective January 1, 2020, the Company increased the allowance for credit losses (ACL) to $62.6 million, and recorded a reserve for unfunded commitments of $2.9 million, through a charge, net of taxes, to retained earnings of $25.0 million, and a reclass of credit discounts on previously classified purchased credit impaired loans of $0.6 million. This increase utilizes economic forecasts to estimate credit losses over the the life of the loan portfolio. Upon adoption, the ACL increased to 1.42% of loans held for investment, and further increased to 1.95% of loans at March 31, 2020. During the first quarter of 2020, the Company recognized a provision for credit losses of $28.0 million, and a provision for unfunded commitments of $1.6 million, reflecting the impact of the declining economic forecasts related to the pandemic crisis. The provision also includes the CECL allowance for credit losses recorded in connection with the Farmers National merger of $2.9 million.
The Company’s net charge-offs to average loans were 0.19% for the first quarter compared to 0.30% in the fourth quarter of 2019 and 0.06% in the first quarter of 2019. The Company's nonperforming assets decreased at March 31, 2020 to 0.74% of total assets compared to 0.77% at December 31, 2019. Nonperforming loans were 0.68% of loans held for investment at March 31, 2020, compared to 0.60% at December 31, 2019. The slight increase was primarily related to the previously excluded purchased credit impaired loans from nonperforming loans in prior periods.
Holmes commented, “While our credit metrics continued to reflect strong credit quality during the first quarter, the impact of the pandemic crisis and the adoption of CECL led to increased provisions and building our ACL, which is reflective of the economic forecasts at the end of the quarter. We have taken actions with customers to offer deferred payments for up to 3 months to allow them to address their individual circumstances related to the crisis.”
Capital Well Positioned
“Our adjusted pre-tax, pre-provision earnings increased by 8.13% linked quarter and provided earnings to offset the increased provisions, while protecting capital, given the proposed CECL regulatory capital transition relief measures, as we navigate the impacts from the pandemic. Our current level of tangible common equity at 9.1% of tangible assets and our simple capital structure of common equity and minimal trust preferred securities, positions us well and gives us multiple capital options, including the


FB Financial Corporation
First Quarter 2020 Results
Page 4

continuation of quarterly dividend in the near term. Our regulatory capital levels remained stable given the regulatory capital transition relief for the adoption of CECL and CECL related provisions.” commented Holmes.
Summary
Holmes further commented, “We look forward to our Annual Shareholders Meeting later this week, which will be held virtually as previously announced. I am extremely proud of our associates as they have served each other, our customers and our communities under the most challenging of circumstances.”
WEBCAST AND CONFERENCE CALL INFORMATION
FB Financial Corporation will host a conference call to discuss the company’s financial results at 8:00 a.m. CT on Tuesday, April 28, 2020, and the conference call will be broadcast live over the Internet at https://www.webcaster4.com/Webcast/Page/1631/33951. An online replay will be available approximately an hour following the conclusion of the live broadcast.

ANNUAL SHAREHOLDERS MEETING
FB Financial Corporation will host a web-based virtual annual shareholders meeting on April 30, 2020. To access the virtual meeting, visit the Company's virtual shareholder meeting website at: http://www.meetingcenter.io/243055954 on April 30, 2020. The meeting will begin at 1:00 p.m. Central Time. To login to the virtual meeting you will be required to have a control number and passcode. The passcode for the meeting is FBK2020. If you were a registered shareholder on the record date, your control number can be found on your proxy card, notice, or email that you previously received.
ABOUT FB FINANCIAL CORPORATION
FB Financial Corporation (NYSE: FBK) is a bank holding company headquartered in Nashville, Tennessee. FB Financial Corporation operates through its wholly owned banking subsidiary, FirstBank, the third largest Tennessee-headquartered community bank, with 73 full-service bank branches across Tennessee, Kentucky, North Alabama and North Georgia, and mortgage offices across the Southeast. FirstBank serves five of the largest metropolitan markets in Tennessee and has approximately $6.7 billion in total assets.
MEDIA CONTACT:
 
FINANCIAL CONTACT:
 
 
 
Jeanie M. Rittenberry
 
Robert Hoehn
615-313-8328
 
615-564-1212
 
www.firstbankonline.com
 
SUPPLEMENTAL FINANCIAL INFORMATION AND EARNINGS PRESENTATION
Investors are encouraged to review this Earnings Release in conjunction with the Supplemental Financial Information and Earnings Presentation posted on the Company’s website, which can be found at https://investors.firstbankonline.com. This Earnings Release, the Supplemental Financial Information and the Earnings Presentation are also included with a Current Report on Form 8-K that the Company furnished to the U.S. Securities and Exchange Commission (“SEC”) on April 27, 2020.
BUSINESS SEGMENT RESULTS
The Company has included its business segment financial tables as part of this Earnings Release. A detailed discussion of our business segments is included in the Company’s Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2019, and investors are encouraged to review that discussion in conjunction with this Earnings Release.
FORWARD-LOOKING STATEMENTS
Certain statements contained in this press release may constitute 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 include, without limitation, statements regarding the projected impact of the COVID-19 global pandemic on our business operations, statements relating to the timing, benefits, costs, and synergies of the proposed merger with Franklin Financial Network, Inc. (“Franklin”) (the “Franklin merger”) and of the recent merger with FNB Financial Corp. (“FNB”) (together with the Franklin merger, the “mergers”), and FB Financial’s future plans, results, strategies, and expectations. These statements can generally be identified by the use of the words and phrases “may,” “will,” “should,” “could,” “would,” “goal,” “plan,”


FB Financial Corporation
First Quarter 2020 Results
Page 5

“potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target,” “aim,” “predict,” “continue,” “seek,” “projection,” and other variations of such words and phrases and similar expressions. These forward-looking statements are not historical facts, and are based upon current expectations, estimates, and projections, many of which, by their nature, are inherently uncertain and beyond FB Financial’s control. The inclusion of these forward-looking statements should not be regarded as a representation by FB Financial or any other person that such expectations, estimates, and projections will be achieved. Accordingly, FB Financial cautions shareholders and investors 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. Actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements including, without limitation, (1) current and future economic conditions, including the effects of declines in housing and commercial real estate prices, high unemployment rates, and any slowdown in economic growth in the local or regional economies in which we operate and/or the US economy generally, (2) the effects of the COVID-19 pandemic, including the magnitude and duration of the pandemic and its impact on general economic and financial market conditions and on our business and our customers' business, results of operations, asset quality and financial condition, (3) changes in government interest rate policies, (4) our ability to effectively manage problem credits, (5) the risk that the cost savings and any revenue synergies from the mergers or another acquisition may not be realized or may take longer than anticipated to be realized, (6) disruption from the mergers with customer, supplier, or employee relationships, (7) the occurrence of any event, change, or other circumstances that could give rise to the termination of the merger agreement with Franklin, (8) the failure to obtain necessary regulatory approvals for the Franklin merger, (9) the failure to obtain the approval of FB Financial and Franklin’s shareholders in connection with the Franklin merger, (10) the possibility that the costs, fees, expenses, and charges related to the mergers may be greater than anticipated, including as a result of unexpected or unknown factors, events, or liabilities, (11) the failure of the conditions to the Franklin merger to be satisfied, (12) the risks related to the integrations of the combined businesses following the mergers, including the risk that the integrations will be materially delayed or will be more costly or difficult than expected, (13) the diversion of management time on issues related to the mergers, (14) the ability of FB Financial to effectively manage the larger and more complex operations of the combined company following the Franklin merger, (15) the risks associated with FB Financial’s pursuit of future acquisitions, (16) reputational risk and the reaction of the parties’ respective customers to the mergers, (17) FB Financial’s ability to successful execute its various business strategies, including its ability to execute on potential acquisition opportunities, (18) the risk of potential litigation or regulatory action related to the Franklin merger, and (19) general competitive, economic, political, and market conditions. Further information regarding FB Financial and factors which could affect the forward-looking statements contained herein can be found in FB Financial's Annual Report on Form 10-K for the fiscal year ended December 31, 2019, and its other filings with the Securities and Exchange Commission (the “SEC”). Many of these factors are beyond FB Financial’s ability to control or predict. If one or more events related to these or other risks or uncertainties materialize, or if the underlying assumptions prove to be incorrect, actual results may differ materially from the forward-looking statements. Accordingly, shareholders and investors should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date of this press release, and FB Financial undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for FB Financial to predict their occurrence or how they will affect the company.
FB Financial qualifies all forward-looking statements by these cautionary statements.
GAAP RECONCILIATION AND USE OF NON-GAAP FINANCIAL MEASURES
This Earnings Release contains certain financial measures that are not measures recognized under U.S. generally accepted accounting principles (“GAAP”) and therefore are considered non-GAAP financial measures. These non-GAAP financial measures include, without limitation, adjusted net income, adjusted diluted earnings per share, adjusted and unadjusted pre-tax pre-provision earnings, adjusted pre-tax pre-provision diluted earnings per share, adjusted and unadjusted pre-tax pre-provision earnings per share, core revenue, core noninterest expense and core noninterest income, core efficiency ratio (tax equivalent basis), Banking segment core efficiency ratio (tax equivalent basis), Mortgage segment core efficiency ratio (tax equivalent basis), adjusted mortgage contribution, adjusted return on average tangible common equity, adjusted pre-tax pre-provision return on average tangible common equity, adjusted return on average assets and equity, adjusted pre-tax pre-provision return on average assets and equity, and core total revenue.  Each of these non-GAAP metrics excludes certain income and expense items that the Company’s management considers to be non-core/adjusted in nature. The Company refers to these non-GAAP measures as adjusted measures. The corresponding Supplemental Financial Information and Earnings Release Presentation also presents tangible assets, tangible common equity, tangible book value per common share, tangible common equity to tangible assets, return on tangible common equity, return on average tangible common equity and adjusted return on average tangible common equity.  Each of these non-GAAP metrics excludes the impact of goodwill and other intangibles.


FB Financial Corporation
First Quarter 2020 Results
Page 6

The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance, financial condition and the efficiency of its operations as management believes such measures facilitate period-to-period comparisons and provide meaningful indications of its operating performance as they eliminate both gains and charges that management views as non-recurring or not indicative of operating performance. Management believes that these non-GAAP financial measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods as well as demonstrate the effects of significant non-core gains and charges in the current and prior periods. The Company’s management also believes that investors find these non-GAAP financial measures useful as they assist investors in understanding the Company’s underlying operating performance and in the analysis of ongoing operating trends. In addition, because intangible assets such as goodwill and other intangibles, and the other items excluded each vary extensively from company to company, the Company believes that the presentation of this information allows investors to more easily compare the Company’s results to the results of other companies. However, the non-GAAP financial measures discussed herein should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which the Company calculates the non-GAAP financial measures discussed herein may differ from that of other companies reporting measures with similar names. Investors should understand how such other banking organizations calculate their financial measures similar or with names similar to the non-GAAP financial measures the Company has discussed herein when comparing such non-GAAP financial measures. See the “Use of non-GAAP Financial Measures” and the corresponding non-GAAP reconciliation tables in the Supplemental Financial Information as well as “Use of non-GAAP Financial Measures” and the Appendix in the Earnings Release Presentation issued April 28, 2020, for a discussion and reconciliation of these measures to the most directly comparable GAAP financial measures.


FB Financial Corporation
First Quarter 2020 Results
Page 7

Financial Summary and Key Metrics
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
2020
 
2019
 
 
First Quarter
 
Fourth Quarter
 
First Quarter
Statement of Income Data
 
 
 
 
 
 
Total interest income
 
$
69,674

 
$
71,643

 
$
65,933

Total interest expense
 
13,425

 
13,951

 
12,917

Net interest income
 
56,249

 
57,692

 
53,016

Total noninterest income
 
42,700

 
35,234

 
29,039

Total noninterest expense
 
68,559

 
62,686

 
55,101

Earnings before income taxes and provisions for credit losses
 
30,390

 
30,240

 
26,954

Provisions for credit losses
 
29,565

 
2,950

 
1,391

Income tax expense
 
80

 
5,718

 
5,975

Net income
 
$
745

 
$
21,572

 
$
19,588

Net interest income (tax—equivalent basis)
 
$
56,784

 
$
58,212

 
$
53,461

Adjusted net income*
 
$
5,296

 
$
22,079

 
$
20,826

Adjusted pre-tax, pre-provision earnings*
 
$
33,440

 
$
30,926

 
$
28,629

Per Common Share
 
 
 

 

Diluted net income
 
$
0.02

 
$
0.68

 
$
0.62

Adjusted diluted net income*
 
0.17

 
0.70

 
0.66

Book value
 
24.40

 
24.56

 
22.51

Tangible book value*
 
18.35

 
18.55

 
17.73

Weighted average number of shares outstanding- fully diluted
 
31,734,112

 
31,470,565

 
31,349,198

Period-end number of shares
 
32,067,356

 
31,034,315

 
30,852,665

Selected Balance Sheet Data
 
 
 
 
 
 
Cash and cash equivalents
 
$
425,094

 
$
232,681

 
$
195,414

Loans held for investment (HFI)
 
4,568,038

 
4,409,642

 
3,786,791

Allowance for credit losses (a)
 
(89,141
)
 
(31,139
)
 
(29,814
)
Loans held for sale
 
325,304

 
262,518

 
248,054

Investment securities, at fair value
 
767,575

 
691,676

 
670,835

Other real estate owned, net
 
17,072

 
18,939

 
12,828

Total assets
 
6,655,687

 
6,124,921

 
5,335,156

Customer deposits
 
5,356,569

 
4,914,587

 
4,242,349

Brokered and internet time deposits
 
20,363

 
20,351

 
60,842

Total deposits
 
5,376,932

 
4,934,938

 
4,303,191

Borrowings
 
327,822

 
304,675

 
229,178

Total shareholders' equity
 
782,330

 
762,329

 
694,577

Selected Ratios
 
 
 
 
 
 
Return on average:
 
 
 
 
 
 
Assets
 
0.05
%
 
1.39
%
 
1.54
%
Shareholders' equity
 
0.39
%
 
11.2
%
 
11.6
%
Tangible common equity*
 
0.52
%
 
14.9
%
 
14.8
%
Average shareholders' equity to average assets
 
12.0
%
 
12.4
%
 
13.2
%
Net interest margin (NIM) (tax-equivalent basis)
 
3.92
%
 
4.12
%
 
4.61
%
Efficiency ratio (GAAP)
 
69.3
%
 
67.5
%
 
67.2
%
Core efficiency ratio (tax-equivalent basis)*
 
65.7
%
 
66.5
%
 
64.9
%
Loans HFI to deposit ratio
 
85.0
%
 
89.4
%
 
88.0
%
Total loans to deposit ratio
 
91.0
%
 
94.7
%
 
93.8
%
Yield on interest-earning assets
 
4.84
%
 
5.11
%
 
5.73
%
Cost of interest-bearing liabilities
 
1.27
%
 
1.38
%
 
1.52
%
Cost of total deposits
 
0.94
%
 
1.02
%
 
1.14
%
Credit Quality Ratios
 
 
 
 
 
 
Allowance for credit losses as a percentage of loans HFI (a)
 
1.95
%
 
0.71
%
 
0.79
%
Net charge-offs as a percentage of average loans HFI
 
0.19
%
 
0.30
%
 
0.06
%
Nonperforming loans HFI as a percentage of total loans HFI
 
0.68
%
 
0.60
%
 
0.41
%
Nonperforming assets as a percentage of total assets
 
0.74
%
 
0.77
%
 
0.57
%
Preliminary capital ratios (Consolidated)
 
 
 
 
 
 
Shareholders' equity to assets
 
11.8
%
 
12.4
%
 
13.0
%
Tangible common equity to tangible assets*
 
9.11
%
 
9.69
%
 
10.5
%
Tier 1 capital (to average assets)
 
10.3
%
 
10.1
%
 
11.5
%
Tier 1 capital (to risk-weighted assets)
 
11.6
%
 
11.6
%
 
12.7
%
Total capital (to risk-weighted assets)
 
12.5
%
 
12.2
%
 
13.4
%
Common equity Tier 1 (to risk-weighted assets) (CET1)
 
11.0
%
 
11.1
%
 
12.0
%
*These measures are considered non-GAAP financial measures. See "GAAP Reconciliation and Use of Non-GAAP Financial Measures" and the corresponding financial tables
below for reconciliations of these Non-GAAP measures. Investors are encouraged to refer to the discussion of non-GAAP measures included in the corresponding earnings release.


FB Financial Corporation
First Quarter 2020 Results
Page 8

Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
 
 
2020
 
2019
Adjusted earnings
 
First Quarter
 
Fourth Quarter
 
First Quarter
Pre-tax net income
 
$
825

 
$
27,290

 
$
25,563

Plus merger and mortgage restructuring expenses
 
3,050

 
686

 
1,675

Plus initial provision for credit losses on acquired loans
 
2,885

 
—

 
—

Adjusted pre-tax earnings
 
$
6,760

 
$
27,976

 
$
27,238

Income tax expense, adjusted
 
1,464

 
5,897

 
6,412

Adjusted earnings
 
$
5,296

 
$
22,079

 
$
20,826

Weighted average common shares outstanding- fully diluted
 
31,734,112
 
31,470,565
 
31,349,198
Adjusted diluted earnings per share
 
 
 
 
 
 
Diluted earnings per common share
 
$
0.02

 
$
0.68

 
$
0.62

Plus merger and mortgage restructuring expenses
 
0.10

 
0.02

 
0.05

Plus initial provision for credit losses on acquired loans
 
0.09

 
—

 
—

Less tax effect
 
0.04

 
—

 
0.01

Adjusted diluted earnings per share
 
$
0.17

 
$
0.70

 
$
0.66

 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted pre-tax pre-provision earnings
 
First Quarter
 
Fourth Quarter
 
First Quarter
Pre-tax net income
 
$
825

 
$
27,290

 
$
25,563

Plus provisions for credit losses
 
29,565

 
2,950

 
1,391

Pre-tax pre-provision earnings
 
30,390

 
30,240

 
26,954

Plus merger and mortgage restructuring expenses
 
3,050

 
686

 
1,675

Adjusted pre-tax pre-provision earnings
 
$
33,440

 
$
30,926

 
$
28,629

Weighted average common shares outstanding-
fully diluted
 
31,734,112

 
31,470,565

 
31,349,198

Adjusted pre-tax pre-provision diluted earnings per share
 
 
 
 
 
 
Diluted earnings per common share
 
$
0.02

 
$
0.68

 
$
0.62

Plus income tax expense
 
—

 
0.18

 
0.19

Plus provisions for credit losses
 
0.93

 
0.10

 
0.05

Pre-tax pre-provision earnings per share
 
0.95

 
0.96

 
0.86

Plus merger and mortgage restructuring expenses
 
0.10

 
0.02

 
0.05

Adjusted pre-tax pre-provision earnings per share
 
$
1.05

 
$
0.98

 
$
0.91

 
 
 
 
 
 
 
 
 
2020
 
2019
Core efficiency ratio (tax-equivalent basis)
 
First Quarter
 
Fourth Quarter
 
First Quarter
Total noninterest expense
 
$
68,559

 
$
62,686

 
$
55,101

Less merger and mortgage restructuring expenses
 
3,050

 
686

 
1,675

Core noninterest expense
 
$
65,509

 
$
62,000

 
$
53,426

Net interest income (tax-equivalent basis)
 
$
56,784

 
$
58,212

 
$
53,461

Total noninterest income
 
42,700

 
35,234

 
29,039

Less (loss) gain on sales or write-downs of other
real estate owned and other assets
 
(277
)
 
277

 
152

Less loss from securities, net
 
63

 
(18
)
 
43

Core noninterest income
 
42,914

 
34,975

 
28,844

Core revenue
 
$
99,698

 
$
93,187

 
$
82,305

Efficiency ratio (GAAP)(a)
 
69.3
%
 
67.5
%
 
67.2
%
Core efficiency ratio (tax-equivalent basis)
 
65.7
%
 
66.5
%
 
64.9
%
(a) Efficiency ratio (GAAP) is calculated by dividing reported noninterest expense by reported total revenue.


FB Financial Corporation
First Quarter 2020 Results
Page 9

Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
 
 
2020
 
2019
Banking segment core efficiency ratio
(tax equivalent)
 
First Quarter
 
Fourth Quarter
 
First Quarter
Core consolidated noninterest expense
 
$
65,509

 
$
62,000

 
$
53,426

Less Mortgage segment core noninterest expense
 
17,567

 
14,956

 
17,486

Core Banking segment noninterest expense
 
$
47,942

 
$
47,044

 
35,940

Core revenue
 
$
99,698

 
$
93,187

 
82,305

Less Mortgage segment total revenue
 
22,110

 
16,193

 
16,658

Core Banking segment total revenue
 
$
77,588

 
$
76,994

 
$
65,647

Banking segment core efficiency ratio
(tax-equivalent basis)
 
61.8
%
 
61.1
%
 
54.7
%
 
 
 
 
 
 
 
Mortgage segment core efficiency ratio
(tax equivalent)
 
 
 
 
 
 
Mortgage segment noninterest expense
 
$
17,567

 
$
14,956

 
$
18,540

Less mortgage restructuring expense
 
—

 
—

 
1,054

Core Mortgage segment noninterest expense
 
$
17,567

 
$
14,956

 
$
17,486

Mortgage segment total revenue
 
$
22,110

 
$
16,193

 
$
16,658

Mortgage segment core efficiency ratio
(tax-equivalent basis)
 
79.5
%
 
92.4
%
 
N/M

 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted mortgage contribution
 
First Quarter
 
Fourth Quarter
 
First Quarter
Mortgage segment pre-tax net contribution (loss)
 
$
4,543

 
$
1,237

 
$
(1,882
)
Retail footprint:
 
 
 
 
 
 
   Mortgage banking income
 
10,651

 
9,899

 
4,386

   Mortgage banking expenses
 
7,175

 
8,126

 
2,831

       Retail footprint pre-tax net contribution
 
3,476

 
1,773

 
1,555

Total adjusted mortgage banking pre-tax net contribution (loss)
 
$
8,019

 
$
3,010

 
$
(327
)
Plus mortgage restructuring expense
 
—

 
—

 
1,054

Total adjusted mortgage banking pre-tax net contribution
 
$
8,019

 
$
3,010

 
$
727

Pre-tax pre-provision earnings
 
$
30,390

 
$
30,240

 
$
26,954

% total mortgage banking pre-tax pre-provision net contribution
 
26.4
%
 
10.0
%
 
N/M

Adjusted pre-tax pre-provision earnings
 
$
33,440

 
$
30,926

 
$
28,629

% total adjusted mortgage banking pre-tax
pre-provision net contribution
 
24.0
%
 
9.73
%
 
2.54
%
 
 
 
 
 
 
 
 
 
2020
 
2019
Tangible assets and equity
 
First Quarter
 
Fourth Quarter
 
First Quarter
Tangible assets
 
 
 
 
 
 
Total assets
 
$
6,655,687

 
$
6,124,921

 
$
5,335,156

Less goodwill
 
174,859

 
169,051

 
137,190

Less intangibles, net
 
18,876

 
17,589

 
10,439

Tangible assets
 
$
6,461,952

 
$
5,938,281

 
$
5,187,527

Tangible common equity
 
 
 
 
 
 
Total shareholders' equity
 
$
782,330

 
$
762,329

 
$
694,577

Less goodwill
 
174,859

 
169,051

 
137,190

Less intangibles, net
 
18,876

 
17,589

 
10,439

Tangible common equity
 
$
588,595

 
$
575,689

 
$
546,948

Common shares outstanding
 
32,067,356

 
31,034,315

 
30,852,665

Book value per common share
 
$
24.40

 
$
24.56

 
$
22.51

Tangible book value per common share
 
$
18.35

 
$
18.55

 
$
17.73

Total shareholders' equity to total assets
 
11.8
%
 
12.4
%
 
13.0
%
Tangible common equity to tangible assets
 
9.11
%
 
9.69
%
 
10.5
%


FB Financial Corporation
First Quarter 2020 Results
Page 10

Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
 
 
 
 
2020
 
2019
Return on average tangible common equity
 
First Quarter
 
Fourth Quarter
 
First Quarter
Total average shareholders' equity
 
$
768,929

 
$
761,949

 
$
684,545

Less average goodwill
 
171,532

 
168,492

 
137,190

Less average intangibles, net
 
18,152

 
18,242

 
10,856

Average tangible common equity
 
$
579,245

 
$
575,215

 
$
536,499

Net income
 
$
745

 
$
21,572

 
$
19,588

Return on average tangible common equity
 
0.52
%
 
14.9
%
 
14.8
%
 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted return on average tangible common
equity
 
First Quarter
 
Fourth Quarter
 
First Quarter
Average tangible common equity
 
$
579,245

 
$
575,215

 
$
536,499

Adjusted net income
 
5,296

 
22,079

 
20,826

Adjusted return on average tangible common
equity
 
3.68
%
 
15.2
%
 
15.7
%
 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted pre-tax pre-provision return on
average tangible common equity
 
First Quarter
 
Fourth Quarter
 
First Quarter
Average tangible common equity
 
$
579,245

 
$
575,215

 
$
536,499

Adjusted pre-tax pre-provision earnings
 
33,440

 
30,926

 
28,629

Adjusted pre-tax pre-provision return on
average tangible common equity
 
23.2
%
 
21.3
%
 
21.6
%
 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted return on average assets and
equity
 
First Quarter
 
Fourth Quarter
 
First Quarter
Net income
 
$
745

 
$
21,572

 
$
19,588

Average assets
 
6,409,417

 
6,157,931

 
5,174,918

Average equity
 
768,929

 
761,949

 
684,545

Return on average assets
 
0.05
%
 
1.39
%
 
1.54
%
Return on average equity
 
0.39
%
 
11.2
%
 
11.6
%
Adjusted net income
 
$
5,296

 
$
22,079

 
$
20,826

Adjusted return on average assets
 
0.33
%
 
1.42
%
 
1.63
%
Adjusted return on average equity
 
2.77
%
 
11.5
%
 
12.3
%
 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted pre-tax pre-provision return on
average assets and equity
 
First Quarter
 
Fourth Quarter
 
First Quarter
Net income
 
$
745

 
$
21,572

 
$
19,588

Average assets
 
6,409,417

 
6,157,931

 
5,174,918

Average equity
 
768,929

 
761,949

 
684,545

Return on average assets
 
0.05
%
 
1.39
%
 
1.54
%
Return on average equity
 
0.39
%
 
11.2
%
 
11.6
%
Adjusted pre-tax pre-provision earnings
 
$
33,440

 
$
30,926

 
$
28,629

Adjusted pre-tax pre-provision return on
average assets
 
2.10
%
 
1.99
%
 
2.24
%
Adjusted pre-tax pre-provision return on
average equity
 
17.5
%
 
16.1
%
 
17.0
%























logoa07.jpg

 
 
First Quarter 2020
Financial Supplement




TABLE OF CONTENTS
 
 
Page
 
 
Financial Summary and Key Metrics
 
 
Consolidated Statements of Income
 
 
Consolidated Balance Sheets
 
 
Average Balance, Average Yield Earned and Average Rate Paid
 
 
FNB Financial Corporation Opening Balance Sheet (Preliminary)
 
 
Loans and Deposits by Market
 
 
Segment Data
 
 
Loan Portfolio and Asset Quality
 
 
Preliminary Capital Ratios
 
 
Investment Portfolio
 
 
Non-GAAP Reconciliation




Use of non-GAAP Financial Measures
 
This Supplemental Financial Information contains certain financial measures that are not measures recognized under U.S. generally accepted accounting principles (“GAAP”) and therefore are considered non-GAAP financial measures. These non-GAAP financial measures include, without limitation, adjusted net income, adjusted diluted earnings per share, adjusted pre-tax pre-provision net income, adjusted pre-tax pre-provision diluted earnings per share, core noninterest expense and core noninterest income, core efficiency ratio (tax equivalent basis), Banking segment core efficiency ratio (tax equivalent basis), Mortgage segment core efficiency ratio (tax equivalent basis), adjusted pre-tax pre-provision mortgage contribution, adjusted return on average assets and equity, adjusted pre-tax pre-provision return on average assets and equity, pro forma return on average assets and equity, adjusted pro forma return on average assets and equity, and core total revenue.  Each of these non-GAAP metrics excludes certain income and expense items that the Company’s management considers to be non-core/adjusted in nature. The Company refers to these non-GAAP measures as adjusted measures. The corresponding Earnings Release and Earnings Release Presentation also presents tangible assets, tangible common equity, tangible book value per common share, tangible common equity to tangible assets, return on tangible common equity, return on average tangible common equity, pro forma return on average tangible common equity, adjusted return on average tangible common equity, pro forma adjusted return on average tangible common equity, and adjusted pre-tax pre-provision return on average tangible common equity.  Each of these non-GAAP metrics excludes the impact of goodwill and other intangibles.
The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance, financial condition and the efficiency of its operations as management believes such measures facilitate period-to-period comparisons and provide meaningful indications of its operating performance as they eliminate both gains and charges that management views as non-recurring or not indicative of operating performance. Management believes that these non-GAAP financial measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods as well as demonstrating the effects of significant non-core gains and charges in the current and prior periods. The Company’s management also believes that investors find these non-GAAP financial measures useful as they assist investors in understanding the Company’s underlying operating performance and in the analysis of ongoing operating trends.  In addition, because intangible assets such as goodwill and other intangibles, and the other items excluded each vary extensively from company to company, the Company believes that the presentation of this information allows investors to more easily compare the Company’s results to the results of other companies.  However, the non-GAAP financial measures discussed herein should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which the Company calculates the non-GAAP financial measures discussed herein may differ from that of other companies reporting measures with similar names. You should understand how such other banking organizations calculate their financial measures similar or with names similar to the non-GAAP financial measures the Company has discussed herein when comparing such non-GAAP financial measures.  The Company includes tables under the Non-GAAP reconciliation section of this document to provide a reconciliation of these measures to the most directly comparable GAAP financial measures.





Financial Summary and Key Metrics
(Unaudited)
(In Thousands, Except Shara Data and %)
 
 
2020
 
2019
 
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Statement of Income Data
 
 
 
 
 
 
 
 
 
 
Total interest income
 
$
69,674

 
$
71,643

 
$
73,242

 
$
71,719

 
$
65,933

Total interest expense
 
13,425

 
13,951

 
14,937

 
14,696

 
12,917

Net interest income
 
56,249

 
57,692

 
58,305

 
57,023

 
53,016

Total noninterest income
 
42,700

 
35,234

 
38,145

 
32,979

 
29,039

Total noninterest expense
 
68,559

 
62,686

 
62,935

 
64,119

 
55,101

Earnings before income taxes and provisions for credit losses
 
30,390

 
30,240

 
33,515

 
25,883

 
26,954

Provisions for credit losses
 
29,565

 
2,950

 
1,831

 
881

 
1,391

Income tax expense
 
80

 
5,718

 
7,718

 
6,314

 
5,975

Net income
 
$
745

 
$
21,572

 
$
23,966

 
$
18,688

 
$
19,588

Net interest income (tax—equivalent basis)
 
$
56,784

 
$
58,212

 
$
58,769

 
$
57,488

 
$
53,461

Adjusted net income*
 
$
5,296

 
$
22,079

 
$
24,267

 
$
22,098

 
$
20,826

Adjusted pre-tax, pre-provision earnings*
 
$
33,440

 
$
30,926

 
$
33,922

 
$
30,495

 
$
28,629

Per Common Share
 
 
 
 
 
 
 
 
 
 
Diluted net income
 
$
0.02

 
$
0.68

 
$
0.76

 
$
0.59

 
$
0.62

Adjusted diluted net income*
 
0.17

 
0.70

 
0.77

 
0.70

 
0.66

Book value
 
24.40

 
24.56

 
24.08

 
23.29

 
22.51

Tangible book value*
 
18.35

 
18.55

 
18.03

 
17.18

 
17.73

Weighted average number of shares outstanding- fully diluted
 
31,734,112

 
31,470,565

 
31,425,573

 
31,378,018

 
31,349,198

Period-end number of shares
 
32,067,356

 
31,034,315

 
30,927,664

 
30,865,636

 
30,852,665

Selected Balance Sheet Data
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
425,094

 
$
232,681

 
$
242,997

 
$
164,336

 
$
195,414

Loans held for investment (HFI)
 
4,568,038

 
4,409,642

 
4,345,344

 
4,289,516

 
3,786,791

Allowance for credit losses (a)
 
(89,141
)
 
(31,139
)
 
(31,464
)
 
(30,138
)
 
(29,814
)
Loans held for sale
 
325,304

 
262,518

 
305,493

 
294,699

 
248,054

Investment securities, at fair value
 
767,575

 
691,676

 
671,781

 
678,457

 
670,835

Other real estate owned, net
 
17,072

 
18,939

 
16,076

 
15,521

 
12,828

Total assets
 
6,655,687

 
6,124,921

 
6,088,895

 
5,940,402

 
5,335,156

Customer deposits
 
5,356,569

 
4,914,587

 
4,896,327

 
4,812,962

 
4,242,349

Brokered and internet time deposits
 
20,363

 
20,351

 
25,436

 
29,864

 
60,842

Total deposits
 
5,376,932

 
4,934,938

 
4,921,763

 
4,842,826

 
4,303,191

Borrowings
 
327,822

 
304,675

 
307,129

 
257,299

 
229,178

Total shareholders' equity
 
782,330

 
762,329

 
744,835

 
718,759

 
694,577

Selected Ratios
 
 
 
 
 
 
 
 
 
 
Return on average:
 
 
 
 
 
 
 
 
 
 
Assets
 
0.05
%
 
1.39
%
 
1.59
%
 
1.30
%
 
1.54
%
Shareholders' equity
 
0.39
%
 
11.2
%
 
13.0
%
 
10.6
%
 
11.6
%
Tangible common equity*
 
0.52
%
 
14.9
%
 
17.5
%
 
14.4
%
 
14.8
%
Average shareholders' equity to average assets
 
12.0
%
 
12.4
%
 
12.2
%
 
12.3
%
 
13.2
%
Net interest margin (NIM) (tax-equivalent basis)
 
3.92
%
 
4.12
%
 
4.28
%
 
4.39
%
 
4.61
%
Efficiency ratio (GAAP)
 
69.3
%
 
67.5
%
 
65.3
%
 
71.2
%
 
67.2
%
Core efficiency ratio (tax-equivalent basis)*
 
65.7
%
 
66.5
%
 
64.5
%
 
65.9
%
 
64.9
%
Loans HFI to deposit ratio
 
85.0
%
 
89.4
%
 
88.3
%
 
88.6
%
 
88.0
%
Total loans to deposit ratio
 
91.0
%
 
94.7
%
 
94.5
%
 
94.7
%
 
93.8
%
Yield on interest-earning assets
 
4.84
%
 
5.11
%
 
5.37
%
 
5.52
%
 
5.73
%
Cost of interest-bearing liabilities
 
1.27
%
 
1.38
%
 
1.50
%
 
1.54
%
 
1.52
%
Cost of total deposits
 
0.94
%
 
1.02
%
 
1.11
%
 
1.14
%
 
1.14
%
Credit Quality Ratios
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses as a percentage of loans HFI (a)
 
1.95
%
 
0.71
%
 
0.72
%
 
0.70
%
 
0.79
%
Net charge-offs as a percentage of average loans HFI
 
0.19
%
 
0.30
%
 
0.05
%
 
0.05
%
 
0.06
%
Nonperforming loans HFI as a percentage of total loans HFI
 
0.68
%
 
0.60
%
 
0.47
%
 
0.43
%
 
0.41
%
Nonperforming assets as a percentage of total assets
 
0.74
%
 
0.77
%
 
0.62
%
 
0.59
%
 
0.57
%
Preliminary capital ratios (Consolidated)
 
 
 
 
 
 
 
 
 
 
Shareholders' equity to assets
 
11.8
%
 
12.4
%
 
12.2
%
 
12.1
%
 
13.0
%
Tangible common equity to tangible assets*
 
9.11
%
 
9.69
%
 
9.45
%
 
9.22
%
 
10.5
%
Tier 1 capital (to average assets)
 
10.3
%
 
10.1
%
 
10.1
%
 
10.0
%
 
11.5
%
Tier 1 capital (to risk-weighted assets)
 
11.6
%
 
11.6
%
 
11.3
%
 
11.0
%
 
12.7
%
Total capital (to risk-weighted assets)
 
12.5
%
 
12.2
%
 
12.0
%
 
11.6
%
 
13.4
%
Common equity Tier 1 (to risk-weighted assets) (CET1)
 
11.0
%
 
11.1
%
 
10.8
%
 
10.4
%
 
12.0
%
(a) Excludes reserve for credit losses on unfunded commitments of $4.6 million recorded in accrued expensed and other liabilities.
*These measures are considered non-GAAP financial measures. See "GAAP Reconciliation and Use of Non-GAAP Financial Measures" and the corresponding financial tables below for reconciliations of these Non-GAAP measures. Investors are encouraged to refer to the discussion of non-GAAP measures included in the corresponding earnings release.

FB Financial Corporation
 
4



Consolidated Statements of Income
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
 
 
 
 
 
 
 
Q1 2020
 
Q1 2020
 
 
 
 
 
 
 
 
 
 
 
 
vs.
 
vs.
 
 
2020
 
2019
 
Q4 2019
 
Q1 2019
 
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
 
Percent variance
 
Percent variance
Interest income:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
 
$
63,754

 
$
66,095

 
$
67,639

 
$
66,276

 
$
60,448

 
(3.54
)%
 
5.47
 %
Interest on securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Taxable
 
3,056

 
2,969

 
3,137

 
3,548

 
3,569

 
2.93
 %
 
(14.4
)%
Tax-exempt
 
1,433

 
1,327

 
1,174

 
1,160

 
1,144

 
7.99
 %
 
25.3
 %
Other
 
1,431

 
1,252

 
1,292

 
735

 
772

 
14.3
 %
 
85.4
 %
Total interest income
 
69,674

 
71,643

 
73,242

 
71,719

 
65,933

 
(2.75
)%
 
5.67
 %
Interest expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deposits
 
12,168

 
12,703

 
13,522

 
13,488

 
11,855

 
(4.21
)%
 
2.64
 %
Borrowings
 
1,257

 
1,248

 
1,415

 
1,208

 
1,062

 
0.72
 %
 
18.4
 %
Total interest expense
 
13,425

 
13,951

 
14,937

 
14,696

 
12,917

 
(3.77
)%
 
3.93
 %
Net interest income
 
56,249

 
57,692

 
58,305

 
57,023

 
53,016

 
(2.50
)%
 
6.10
 %
Provision for credit losses
 
27,964

 
2,950

 
1,831

 
881

 
1,391

 
847.9
 %
 
1,910.4
 %
Provision for credit losses on unfunded commitments
 
1,601

 
—

 
—

 
—

 
—

 
100.0
 %
 
100.0
 %
Net interest income after
provisions for credit losses
 
26,684

 
54,742

 
56,474

 
56,142

 
51,625

 
(51.3
)%
 
(48.3
)%
Noninterest income:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mortgage banking income
 
32,745

 
26,176

 
29,193

 
24,526

 
21,021

 
25.1
 %
 
55.8
 %
Service charges on deposit accounts
 
2,563

 
2,657

 
2,416

 
2,327

 
2,079

 
(3.54
)%
 
23.3
 %
ATM and interchange fees
 
3,134

 
3,315

 
3,188

 
3,002

 
2,656

 
(5.46
)%
 
18.0
 %
Investment services and trust income
 
1,697

 
1,326

 
1,336

 
1,287

 
1,295

 
28.0
 %
 
31.0
 %
Gain (loss) from securities, net
 
63

 
(18
)
 
(20
)
 
52

 
43

 
(450.0
)%
 
46.5
 %
Gain (loss) on sales or write-downs of
other real estate owned
 
51

 
433

 
(126
)
 
277

 
(39
)
 
(88.2
)%
 
(230.8
)%
(Loss) gain from other assets
 
(328
)
 
(156
)
 
44

 
(183
)
 
191

 
110.3
 %
 
(271.7
)%
Other income
 
2,775

 
1,501

 
2,114

 
1,691

 
1,793

 
84.9
 %
 
54.8
 %
Total noninterest income
 
42,700

 
35,234

 
38,145

 
32,979

 
29,039

 
21.2
 %
 
47.0
 %
Total revenue
 
98,949

 
92,926

 
96,450

 
90,002

 
82,055

 
6.48
 %
 
20.6
 %
Noninterest expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Salaries, commissions and employee benefits
 
43,622

 
39,589

 
40,880

 
37,918

 
33,697

 
10.2
 %
 
29.5
 %
Occupancy and equipment expense
 
4,178

 
3,534

 
4,058

 
4,319

 
3,730

 
18.2
 %
 
12.0
 %
Legal and professional fees
 
1,558

 
2,074

 
1,993

 
1,694

 
1,725

 
(24.9
)%
 
(9.68
)%
Data processing
 
2,453

 
2,746

 
2,816

 
2,643

 
2,384

 
(10.7
)%
 
2.89
 %
Merger costs
 
3,050

 
686

 
295

 
3,783

 
621

 
344.6
 %
 
391.1
 %
Amortization of core deposits and other intangibles
 
1,204

 
1,159

 
1,197

 
1,254

 
729

 
3.88
 %
 
65.2
 %
Advertising
 
2,389

 
2,072

 
1,895

 
2,434

 
2,737

 
15.3
 %
 
(12.7
)%
Mortgage restructuring expense
 
—

 
—

 
112

 
829

 
1,054

 
—
 %
 
(100.0
)%
Other expense
 
10,105

 
10,826

 
9,689

 
9,245

 
8,424

 
(6.7
)%
 
19.95
 %
Total noninterest expense
 
68,559

 
62,686

 
62,935

 
64,119

 
55,101

 
9.37
 %
 
24.4
 %
Income before income taxes
 
825

 
27,290

 
31,684

 
25,002

 
25,563

 
(97.0
)%
 
(96.8
)%
Income tax expense
 
80

 
5,718

 
7,718

 
6,314

 
5,975

 
(98.6
)%
 
(98.7
)%
Net income
 
$
745

 
$
21,572

 
$
23,966

 
$
18,688

 
$
19,588

 
(96.5
)%
 
(96.2
)%
Earnings available to common shareholders
 
$
745

 
$
21,458

 
$
23,838

 
$
18,588

 
$
19,483

 
 

 
 

Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 

 
 

Basic
 
31,257,739

 
30,934,092

 
30,899,583

 
30,859,596

 
30,786,684

 
1.05
 %
 
1.53
 %
Fully diluted
 
31,734,112

 
31,470,565

 
31,425,573

 
31,378,018

 
31,349,198

 
0.84
 %
 
1.23
 %
Earnings per common share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
 
$
0.02

 
$
0.69

 
$
0.77

 
$
0.60

 
$
0.63

 
(97.1
)%
 
(96.8
)%
Fully diluted
 
0.02

 
0.68

 
0.76

 
0.59

 
0.62

 
(97.1
)%
 
(96.8
)%
Fully diluted- adjusted*
 
0.17

 
0.70

 
0.77

 
0.70

 
0.66

 
(76.2
)%
 
(74.8
)%
*These measures are considered non-GAAP financial measures. See “GAAP Reconciliation and Use of Non-GAAP Financial Measures” and the corresponding financial tables below for reconciliations of these Non-GAAP measures. Investors are encouraged to refer to the discussion of non-GAAP measures included in the corresponding earnings release.



FB Financial Corporation
 
5



Consolidated Balance Sheets
(Unaudited)
(In Thousands, Except %)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Annualized
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Q1 2020
 
Q1 2020
 
 
 
 
 
 
 
 
 
 
 
 
vs.
 
vs.
 
 
2020
 
2019
 
Q4 2019
 
Q1 2019
 
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
 
Percent variance
 
Percent variance
ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and due from banks
 
$
26,841

 
$
48,806

 
$
31,594

 
$
64,458

 
$
60,253

 
(181.0
)%
 
(55.5
)%
Federal funds sold
 
59,199

 
131,119

 
50,532

 
9,781

 
6,600

 
(220.6
)%
 
797.0
 %
Interest-bearing deposits in financial institutions
 
339,054

 
52,756

 
160,871

 
90,097

 
128,561

 
2182.7
 %
 
163.7
 %
Cash and cash equivalents
 
425,094

 
232,681

 
242,997

 
164,336

 
195,414

 
332.6
 %
 
117.5
 %
Investments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale debt securities, at fair value
 
764,217

 
688,381

 
668,531

 
675,215

 
667,654

 
44.3
 %
 
14.5
 %
Equity securities, at fair value
 
3,358

 
3,295

 
3,250

 
3,242

 
3,181

 
7.69
 %
 
5.56
 %
Federal Home Loan Bank stock, at cost
 
16,445

 
15,976

 
15,976

 
15,976

 
13,432

 
11.8
 %
 
22.4
 %
Loans held for sale, at fair value
 
325,304

 
262,518

 
305,493

 
294,699

 
248,054

 
96.2
 %
 
31.1
 %
Loans held for investment
 
4,568,038

 
4,409,642

 
4,345,344

 
4,289,516

 
3,786,791

 
14.4
 %
 
20.6
 %
Less: allowance for credit losses
 
89,141

 
31,139

 
31,464

 
30,138

 
29,814

 
749.2
 %
 
199.0
 %
Net loans
 
4,478,897

 
4,378,503

 
4,313,880

 
4,259,378

 
3,756,977
 
9.22
 %
 
19.2
 %
Premises and equipment, net
 
100,406

 
90,131

 
91,815

 
92,407

 
87,013

 
45.9
 %
 
15.4
 %
Other real estate owned, net
 
17,072

 
18,939

 
16,076

 
15,521

 
12,828

 
(39.6
)%
 
33.1
 %
Operating lease right-of-use assets
 
31,628

 
32,539

 
34,812

 
35,872

 
32,694

 
(11.3
)%
 
(3.26
)%
Interest receivable
 
19,644

 
17,083

 
17,729

 
17,952

 
16,611

 
60.3
 %
 
18.3
 %
Mortgage servicing rights, at fair value
 
62,581

 
75,521

 
66,156

 
66,380

 
64,031

 
(68.9
)%
 
(2.26
)%
Goodwill
 
174,859

 
169,051

 
168,486

 
168,486

 
137,190

 
13.8
 %
 
27.5
 %
Core deposit and other intangibles, net
 
18,876

 
17,589

 
18,748

 
19,945

 
10,439

 
29.4
 %
 
80.8
 %
Other assets
 
217,306

 
122,714

 
124,946

 
110,993

 
89,638

 
310.0
 %
 
142.4
 %
Total assets
 
$
6,655,687

 
$
6,124,921

 
$
6,088,895

 
$
5,940,402

 
$
5,335,156

 
34.9
 %
 
24.8
 %
LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deposits
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Noninterest-bearing
 
$
1,335,799

 
$
1,208,175

 
$
1,214,373

 
$
1,111,921

 
$
964,745

 
42.5
 %
 
38.5
 %
Interest-bearing checking
 
1,139,462

 
1,014,875

 
1,029,430

 
984,847

 
937,323

 
49.4
 %
 
21.6
 %
Money market and savings
 
1,667,374

 
1,520,035

 
1,481,697

 
1,468,867

 
1,257,863

 
39.0
 %
 
32.6
 %
Customer time deposits
 
1,213,934

 
1,171,502

 
1,170,827

 
1,247,327

 
1,082,418

 
14.6
 %
 
12.2
 %
Brokered and internet time deposits
 
20,363

 
20,351

 
25,436

 
29,864

 
60,842

 
0.24
 %
 
(66.5
)%
Total deposits
 
5,376,932

 
4,934,938

 
4,921,763

 
4,842,826
 
4,303,191
 
36.0
 %
 
25.0
 %
Borrowings
 
327,822

 
304,675

 
307,129

 
257,299

 
229,178

 
30.6
 %
 
43.0
 %
Operating lease liabilities
 
34,572

 
35,525

 
37,760

 
38,722

 
35,093

 
(10.8
)%
 
(1.48
)%
Accrued expenses and other liabilities
 
134,031

 
87,454

 
77,408

 
82,796

 
73,117

 
214.2
 %
 
83.3
 %
Total liabilities
 
5,873,357

 
5,362,592

 
5,344,060

 
5,221,643
 
4,640,579
 
38.3
 %
 
26.6
 %
Shareholders' equity:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock, $1 par value
 
32,067

 
31,034

 
30,928

 
30,866

 
30,853

 
13.4
 %
 
3.93
 %
Additional paid-in capital
 
460,938

 
425,633

 
426,816

 
425,644

 
423,647

 
33.4
 %
 
8.80
 %
Retained earnings
 
266,385

 
293,524

 
274,491

 
253,080

 
236,947

 
(37.2
)%
 
12.4
 %
Accumulated other comprehensive income, net
 
22,940

 
12,138

 
12,600

 
9,169

 
3,130

 
357.9
 %
 
632.9
 %
Total shareholders' equity
 
782,330

 
762,329

 
744,835

 
718,759

 
694,577

 
10.6
 %
 
12.6
 %
Total liabilities and shareholders' equity
 
$
6,655,687

 
$
6,124,921

 
$
6,088,895

 
$
5,940,402

 
$
5,335,156

 
34.9
 %
 
24.8
 %



FB Financial Corporation
 
6



Average Balance, Average Yield Earned and Average Rate Paid
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
 
 
Three Months Ended
 
Three Months Ended
 
 
March 31, 2020
 
December 31, 2019
 
 
Average
balances
 
Interest
income/
expense
 
Average
yield/
rate
 
Average
balances
 
Interest
income/
expense
 
Average
yield/
rate
Interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
 
Loans HFI(a)
 
$
4,495,069

 
$
61,817

 
5.53
%
 
$
4,384,180

 
$
64,053

 
5.80
%
Loans held for sale(b)
 
214,150

 
1,990

 
3.74
%
 
257,833

 
2,095

 
3.22
%
Securities:(b)
 
 
 
 
 
 
 
 
 
 
 
 
Taxable
 
512,774

 
3,056

 
2.40
%
 
505,299

 
2,969

 
2.33
%
Tax-exempt(a)
 
197,961

 
1,915

 
3.89
%
 
181,922

 
1,794

 
3.91
%
Total securities(a)
 
710,735

 
4,971

 
2.81
%
 
687,221

 
4,763

 
2.75
%
Federal funds sold
 
107,489

 
245

 
0.92
%
 
69,749

 
301

 
1.71
%
Interest-bearing deposits with other financial institutions
 
287,499

 
1,082

 
1.51
%
 
185,319

 
790

 
1.69
%
FHLB stock
 
16,226

 
104

 
2.58
%
 
15,976

 
161

 
4.00
%
Total interest-earning assets(a)
 
5,831,168

 
70,209

 
4.84
%
 
5,600,278

 
72,163

 
5.11
%
Noninterest-earning assets:
 
 

 
 
 
 
 
 
 
 
 
 
Cash and due from banks
 
64,438

 
 
 
 
 
49,318

 
 
 
 
Allowance for credit losses
 
(63,034
)
 
 
 
 
 
(31,631
)
 
 
 
 
Other assets
 
576,845

 
 
 
 
 
539,966

 
 
 
 
Total noninterest-earning assets
 
578,249

 
 
 
 
 
557,653

 
 
 
 
Total assets
 
$
6,409,417

 
 
 
 
 
$
6,157,931

 
 
 
 
Interest-bearing liabilities:
 
 

 
 
 
 
 
 
 
 
 
 
Interest-bearing deposits:
 
 

 
 
 
 
 
 
 
 
 
 
Interest-bearing checking
 
$
1,085,849

 
$
2,179

 
0.81
%
 
$
981,572

 
$
2,068

 
0.84
%
Money market
 
1,383,229

 
3,971

 
1.15
%
 
1,320,268

 
4,309

 
1.29
%
Savings deposits
 
233,807

 
79

 
0.14
%
 
210,550

 
79

 
0.15
%
Customer time deposits
 
1,205,385

 
5,843

 
1.95
%
 
1,175,467

 
6,133

 
2.07
%
Brokered and internet time deposits
 
20,355

 
96

 
1.90
%
 
23,219

 
114

 
1.95
%
       Time deposits
 
1,225,740

 
5,939

 
1.95
%
 
1,198,686

 
6,247

 
2.07
%
Total interest-bearing deposits
 
3,928,625

 
12,168

 
1.25
%
 
3,711,076

 
12,703

 
1.36
%
Other interest-bearing liabilities:
 
 

 
 
 
 
 
 
 
 
 
 
Securities sold under agreements to repurchase and
federal funds purchased
 
26,961

 
57

 
0.85
%
 
27,610

 
59

 
0.85
%
Federal Home Loan Bank advances
 
250,000

 
714

 
1.15
%
 
250,000

 
788

 
1.25
%
Subordinated debt
 
30,930

 
421

 
5.47
%
 
30,930

 
401

 
5.14
%
Other borrowings
 
7,747

 
65

 
3.37
%
 
—

 
—

 
—
%
Total other interest-bearing liabilities
 
315,638

 
1,257

 
1.60
%
 
308,540

 
1,248

 
1.60
%
Total interest-bearing liabilities
 
4,244,263

 
13,425

 
1.27
%
 
4,019,616

 
13,951

 
1.38
%
Noninterest-bearing liabilities:
 
 

 
 
 
 
 
 
 
 
 
 
Demand deposits
 
1,284,331

 
 
 
 
 
1,253,311

 
 
 
 
Other liabilities
 
111,894

 
 
 
 
 
123,055

 
 
 
 
Total noninterest-bearing liabilities
 
1,396,225

 
 
 
 
 
1,376,366

 
 
 
 
Total liabilities
 
5,640,488

 
 
 
 
 
5,395,982

 
 
 
 
Shareholders' equity
 
768,929

 
 
 
 
 
761,949

 
 
 
 
Total liabilities and shareholders' equity
 
$
6,409,417

 
 
 
 
 
$
6,157,931

 
 
 
 
Net interest income(a)
 
 

 
$
56,784

 
 
 
 
 
$
58,212

 
 
Interest rate spread(a)
 
 

 
 

 
3.57
%
 
 
 
 
 
3.74
%
Net interest margin(a)
 
 

 
 

 
3.92
%
 
 
 
 
 
4.12
%
Cost of total deposits
 
 

 
 

 
0.94
%
 
 
 
 
 
1.02
%
Average interest-earning assets to average interest-bearing liabilities
 
 
 
 
 
137.4
%
 
 
 
 
 
139.3
%
Tax-equivalent adjustment
 
 

 
$
535

 
 
 
 
 
$
520

 
 
Loans HFI yield components:
 
 

 
 

 
 
 
 
 
 
 
 
    Contractual interest rate(a)
 
 

 
$
57,382

 
5.14
%
 
 
 
$
58,219

 
5.27
%
    Origination and other loan fee income
 
 
 
2,589

 
0.23
%
 
 
 
2,863

 
0.26
%
    Accretion on purchased loans
 
 

 
1,578

 
0.14
%
 
 
 
2,526

 
0.23
%
    Nonaccrual interest
 
 

 
268

 
0.02
%
 
 
 
439

 
0.04
%
    Syndication fee income
 
 

 
—

 
—
%
 
 
 
6

 
—
%
          Total loans HFI yield
 
 

 
$
61,817

 
5.53
%
 
 
 
$
64,053

 
5.80
%
(a) Includes tax equivalent adjustment using combined marginal tax rate of 26.060%.
(b) Excludes the average balance for unrealized gains (losses) prospectively from Q1 2020 for loans held for sale and investments carried at fair value.


FB Financial Corporation
 
7







Average Balance, Average Yield Earned and Average Rate Paid
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
 
 
Three Months Ended
 
Three Months Ended
 
Three Months Ended
 
 
September 30, 2019
 
June 30, 2019
 
March 31, 2019
 
 
Average
balances
 
Interest
income/
expense
 
Average
yield/
rate
 
Average
balances
 
Interest
income/
expense
 
Average
yield/
rate
 
Average
balances
 
Interest
income/
expense
 
Average
yield/
rate
Interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans HFI(a)
 
$
4,306,725

 
$
65,241

 
6.01
%
 
$
4,177,701

 
$
63,262

 
6.07
%
 
$
3,720,739

 
$
58,137

 
6.34
%
Loans held for sale
 
262,896

 
2,448

 
3.69
%
 
281,252

 
3,070

 
4.38
%
 
216,227

 
2,353

 
4.41
%
Securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Taxable
 
508,924

 
3,137

 
2.45
%
 
532,500

 
3,548

 
2.67
%
 
518,504

 
3,569

 
2.79
%
Tax-exempt(a)
 
153,633

 
1,588

 
4.10
%
 
146,282

 
1,569

 
4.30
%
 
138,847

 
1,547

 
4.52
%
Total securities(a)
 
662,557

 
4,725

 
2.83
%
 
678,782

 
5,117

 
3.02
%
 
657,351

 
5,116

 
3.16
%
Federal funds sold
 
24,388

 
166

 
2.70
%
 
12,219

 
88

 
2.89
%
 
18,392

 
123

 
2.71
%
Interest-bearing deposits with other financial
institutions
 
176,708

 
950

 
2.13
%
 
81,540

 
465

 
2.29
%
 
75,291

 
446

 
2.40
%
FHLB stock
 
15,976

 
176

 
4.37
%
 
15,165

 
182

 
4.81
%
 
13,432

 
203

 
6.13
%
Total interest-earning assets(a)
 
5,449,250

 
73,706

 
5.37
%
 
5,246,659

 
72,184

 
5.52
%
 
4,701,432

 
66,378

 
5.73
%
Noninterest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and due from banks
 
51,433

 
 
 
 
 
54,659

 
 
 
 
 
50,218

 
 
 
 
Allowance for credit losses
 
(30,484
)
 
 
 
 
 
(30,092
)
 
 
 
 
 
(29,537
)
 
 
 
 
Other assets
 
518,373

 
 
 
 
 
500,145

 
 
 
 
 
452,805

 
 
 
 
Total noninterest-earning assets
 
539,322

 
 
 
 
 
524,712

 
 
 
 
 
473,486

 
 
 
 
Total assets
 
$
5,988,572

 
 
 
 
 
$
5,771,371

 
 
 
 
 
$
5,174,918

 
 
 
 
Interest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposits:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
    Interest-bearing checking
 
$
971,686

 
$
2,338

 
0.95
%
 
$
968,081

 
$
2,295

 
0.95
%
 
$
878,167

 
$
2,054

 
0.95
%
    Money market
 
1,260,555

 
4,607

 
1.45
%
 
1,221,450

 
4,508

 
1.48
%
 
1,073,170

 
3,956

 
1.49
%
    Savings deposits
 
207,221

 
78

 
0.15
%
 
203,602

 
76

 
0.15
%
 
176,305

 
68

 
0.16
%
    Customer time deposits
 
1,184,737

 
6,362

 
2.13
%
 
1,185,451

 
6,299

 
2.13
%
 
1,053,958

 
5,309

 
2.04
%
    Brokered and internet time deposits
 
28,273

 
137

 
1.92
%
 
56,242

 
310

 
2.21
%
 
93,434

 
468

 
2.03
%
       Time deposits
 
1,213,010

 
6,499

 
2.13
%
 
1,241,693

 
6,609

 
2.13
%
 
1,147,392

 
5,777

 
2.04
%
Total interest-bearing deposits
 
3,652,472

 
13,522

 
1.47
%
 
3,634,826

 
13,488

 
1.49
%
 
3,275,034

 
11,855

 
1.47
%
Other interest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Securities sold under agreements to
   repurchase and federal funds purchased
 
30,585

 
80

 
1.04
%
 
31,905

 
117

 
1.47
%
 
15,319

 
35

 
0.93
%
    Federal Home Loan Bank advances
 
248,315

 
918

 
1.47
%
 
131,726

 
664

 
2.02
%
 
117,875

 
634

 
2.18
%
    Subordinated debt
 
30,930

 
417

 
5.35
%
 
30,930

 
427

 
5.54
%
 
30,930

 
393

 
5.15
%
Total other interest-bearing liabilities
 
309,830

 
1,415

 
1.81
%
 
194,561

 
1,208

 
2.49
%
 
164,124

 
1,062

 
2.62
%
Total interest-bearing liabilities
 
3,962,302

 
14,937

 
1.50
%
 
3,829,387

 
14,696

 
1.54
%
 
3,439,158

 
12,917

 
1.52
%
Noninterest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Demand deposits
 
1,180,685

 
 
 
 
 
1,128,311

 
 
 
 
 
955,156

 
 
 
 
Other liabilities
 
113,884

 
 
 
 
 
105,116

 
 
 
 
 
96,059

 
 
 
 
Total noninterest-bearing liabilities
 
1,294,569

 
 
 
 
 
1,233,427

 
 
 
 
 
1,051,215

 
 
 
 
Total liabilities
 
5,256,871

 
 
 
 
 
5,062,814

 
 
 
 
 
4,490,373

 
 
 
 
Shareholders' equity
 
731,701

 
 
 
 
 
708,557

 
 
 
 
 
684,545

 
 
 
 
Total liabilities and shareholders' equity
 
$
5,988,572

 
 
 
 
 
$
5,771,371

 
 
 
 
 
$
5,174,918

 
 
 
 
Net interest income(a)
 
 
 
$
58,769

 
 
 
 
 
$
57,488

 
 
 
 
 
$
53,461

 
 
Interest rate spread(a)
 
 
 
 
 
3.87
%
 
 
 
 
 
3.98
%
 
 
 
 
 
4.21
%
Net interest margin(a)
 
 
 
 
 
4.28
%
 
 
 
 
 
4.39
%
 
 
 
 
 
4.61
%
Cost of total deposits
 
 
 
 
 
1.11
%
 
 
 
 
 
1.14
%
 
 
 
 
 
1.14
%
Average interest-earning assets to average
interest-bearing liabilities
 
 
 
 
 
137.5
%
 
 
 
 
 
137.0
%
 
 
 
 
 
136.7
%
Tax-equivalent adjustment
 
 
 
$
464

 
 
 
 
 
$
465

 
 
 
 
 
$
445

 
 
Loans HFI yield components:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
    Contractual interest rate(a)
 
 
 
$
59,645

 
5.50
%
 
 
 
$
58,028

 
5.57
%
 
 
 
$
52,177

 
5.69
%
    Origination and other loan fee income
 
 
 
3,293

 
0.30
%
 
 
 
2,981

 
0.29
%
 
 
 
3,840

 
0.42
%
    Accretion on purchased loans
 
 
 
2,102

 
0.19
%
 
 
 
2,097

 
0.20
%
 
 
 
1,831

 
0.20
%
    Nonaccrual interest
 
 
 
201

 
0.02
%
 
 
 
156

 
0.01
%
 
 
 
89

 
0.01
%
    Syndication fee income
 
 
 
—

 
—
%
 
 
 
—

 
—
%
 
 
 
200

 
0.02
%
          Total loans HFI yield
 
 
 
$
65,241

 
6.01
%
 
 
 
$
63,262

 
6.07
%
 
 
 
$
58,137

 
6.34
%
(a) Includes tax equivalent adjustment using combined marginal tax rate of 26.060%.

FB Financial Corporation
 
8



FNB Financial Corporation Opening Balance Sheet (Preliminary)
As of February 14, 2020
(Unaudited)
(In Thousands)
 
 
 
 
 
 
As Recorded by FB Financial Corporation (Preliminary)(a)
Assets
 
 
Cash and cash equivalents
 
$
10,774

Securities
 
50,594

Loans, net of fair value premium
 
182,171

Allowance for credit losses on PCD loans
 
(669
)
Premises and equipment
 
8,021

Core deposit intangibles
 
2,490

Goodwill
 
5,808

Accrued interest and other assets
 
4,809

Total assets
 
$
263,998

 
 
 
Liabilities
 
 
Deposits
 
$
209,535

Borrowings
 
3,192

Accrued expenses and other liabilities
 
1,229

    Total liabilities
 
$
213,956

 
 
 
Consideration
 
 
Value of 954,797 shares issued
 
$
35,041

Cash paid
 
15,001

    Total consideration
 
$
50,042

 
 
 
Loan composition:
 
 
Commercial and industrial
 
$
12,844

Construction
 
20,441

Residential real estate:
 
 
1-to-4 family mortgage
 
50,161

Residential line of credit
 
3,934

Multi-family mortgage
 
7,172

Commercial real estate:
 
 
Owner occupied
 
39,187

Non-owner occupied
 
39,774

Consumer and other
 
8,658

Total loans
 
$
182,171

 
 
 
Deposit composition:
 
 
Noninterest-bearing
 
$
63,531

Interest-bearing checking
 
26,451

Money market and savings
 
37,002

Customer time deposits
 
82,551

Total deposits
 
$
209,535

(a) The above estimated fair values of assets acquired and liabilities assumed are preliminary and are subject to change during the measurement period as allowed under ASC 805 - Business Combinations.

FB Financial Corporation
 
9



Loans and Deposits by Market
For the Quarters Ended
(Unaudited)
(In Thousands)
 
 
 
 
 
 
 
2020
 
2019
 
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Loans by market
 
 
 
 
 
 
 
 
 
 
Metropolitan(a)
 
$
3,217,598

 
$
3,061,183

 
$
3,011,118

 
$
2,970,794

 
$
2,516,582

Community
 
820,180

 
817,380

 
802,923

 
803,306

 
784,671

Specialty lending and other
 
530,260

 
531,079

 
531,303

 
515,416

 
485,538

Total
 
$
4,568,038

 
$
4,409,642

 
$
4,345,344

 
$
4,289,516

 
$
3,786,791

Deposits by market
 
 
 
 
 
 
 
 
 
 
Metropolitan(a)
 
$
3,272,740

 
$
2,963,524

 
$
2,869,049

 
$
2,794,977

 
$
2,350,421

Community
 
1,731,050

 
1,642,949

 
1,620,153

 
1,612,885

 
1,482,877

Mortgage and other(b)
 
373,142

 
328,465

 
432,561

 
434,964

 
469,893

Total
 
$
5,376,932

 
$
4,934,938

 
$
4,921,763

 
$
4,842,826

 
$
4,303,191

(a) Includes loans and deposits acquired from Farmers National Bank of Scottsville.
(b) Includes deposits related to escrow balances from mortgage servicing portfolio and wholesale/other deposits.


FB Financial Corporation
 
10



 
Segment Data
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
 
 
 
 
 
 
 
2020
 
2019
 
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Banking segment
 
 
 
 
 
 
 
 
 
 
Net interest income
 
$
56,233

 
$
57,776

 
$
58,350

 
$
56,979

 
$
52,993

Provisions for credit losses
 
29,565

 
2,950

 
1,831

 
881

 
1,391

Mortgage banking income retail footprint
 
10,651

 
9,899

 
10,693

 
5,451

 
4,386

Other noninterest income
 
9,955

 
9,058

 
8,952

 
8,453

 
8,018

Other noninterest mortgage banking expenses
 
7,175

 
8,126

 
8,087

 
4,172

 
2,831

Merger expense
 
3,050

 
686

 
295

 
3,783

 
621

Other noninterest expense
 
40,767

 
38,918

 
38,755

 
37,500

 
33,109

Pre-tax (loss) income after allocations
 
$
(3,718
)
 
$
26,053

 
$
29,027

 
$
24,547

 
$
27,445

Total assets
 
$
6,211,640

 
$
5,795,888

 
$
5,730,492

 
$
5,552,893

 
$
4,987,744

Intracompany funding income included in net interest income
 
2,375

 
2,460

 
2,875

 
3,290

 
2,558

Core efficiency ratio*
 
61.8
%
 
61.1
%
 
59.6
%
 
58.5
%
 
54.7
%
Mortgage segment
 
 
 
 
 
 
 
 
 
 
Net interest income
 
$
16

 
$
(84
)
 
$
(45
)
 
$
44

 
$
23

Noninterest income
 
22,094

 
16,277

 
18,500

 
19,075

 
16,635

Mortgage restructuring expense
 
—

 
—

 
112

 
829

 
1,054

Noninterest expense
 
17,567

 
14,956

 
15,686

 
17,835

 
17,486

Direct contribution (loss)
 
$
4,543

 
$
1,237

 
$
2,657

 
$
455

 
$
(1,882
)
Total assets
 
$
444,047

 
$
329,033

 
$
358,403

 
$
387,509

 
$
347,412

Intracompany funding expense included in net interest income
 
2,375

 
2,460

 
2,875

 
3,290

 
2,558

Core efficiency ratio*
 
79.5
%
 
92.4
%
 
85.0
%
 
93.3
%
 
N/A

Interest rate lock commitments volume during the period
 
 
 
 
 
 
 
 
 
 
Consumer direct
 
$
1,314,625

 
$
679,096

 
$
973,142

 
$
805,970

 
$
521,603

Retail
 
779,155

 
402,490

 
503,861

 
407,007

 
291,800

Wholesale
 
—

 
—

 
159,263

 
607,373

 
551,383

Total
 
$
2,093,780

 
$
1,081,586

 
$
1,636,266

 
$
1,820,350

 
$
1,364,786

Interest rate lock commitments pipeline (period end)
 
 
 
 
 
 
 
 
 
 
Consumer direct
 
$
653,593

 
$
348,389

 
$
519,698

 
$
397,150

 
$
235,505

Retail
 
430,940

 
104,809

 
159,826

 
135,655

 
110,480

Wholesale
 
—

 
—

 
—

 
75,925

 
146,522

Total
 
$
1,084,533

 
$
453,198

 
$
679,524

 
$
608,730

 
$
492,507

Mortgage sales
 
 
 
 
 
 
 
 
 
 
Consumer direct
 
$
684,209

 
$
718,624

 
$
588,535

 
$
428,886

 
$
287,720

Retail
 
158,224

 
120,487

 
94,735

 
81,849

 
59,084

Retail footprint
 
199,043

 
266,328

 
256,060

 
205,698

 
146,312

Wholesale
 
—

 
652

 
284,655

 
542,229

 
473,109

Total
 
$
1,041,476

 
$
1,106,091

 
$
1,223,985

 
$
1,258,662

 
$
966,225

Gains and fees from origination and sale of mortgage
loans held for sale
 
$
30,390

 
$
31,807

 
$
28,020

 
$
20,976

 
$
15,907

Net change in fair value of loans
held for sale, derivatives, and other
 
3,205

 
(4,328
)
 
2,304

 
3,298

 
2,244

Mortgage servicing income
 
5,018

 
4,914

 
3,960

 
4,052

 
4,751

Change in fair value of mortgage
servicing rights, net of hedging
 
(5,868
)
 
(6,217
)
 
(5,091
)
 
(3,800
)
 
(1,881
)
Total mortgage banking income
 
$
32,745

 
$
26,176

 
$
29,193

 
$
24,526

 
$
21,021

Mortgage sale margin(a)
 
2.92
%
 
2.88
%
 
2.29
%
 
1.67
%
 
1.65
%
*These measures are considered non-GAAP financial measures. See "GAAP Reconciliation and Use of Non-GAAP financial measures" and the corresponding financial tables below for a reconciliation and discussion of these non-GAAP measures for a reconciliation and discussion of this non-GAAP measure.
(a) Calculated by dividing gains and fees from origination and sale of mortgage loans held for sale by total mortgage sales.

FB Financial Corporation
 
11



Loan Portfolio and Asset Quality
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
 
 
2020
 
2019
 
 
First Quarter
 
% of Total
 
Fourth Quarter
 
% of Total
 
Third Quarter
 
% of Total
 
Second Quarter
 
% of Total
 
First Quarter
 
% of Total
Loan portfolio
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial
 
$
1,020,484

 
23
%
 
$
1,034,036

 
23
%
 
$
997,921

 
23
%
 
$
989,288

 
23
%
 
$
888,345

 
23
%
Construction
 
599,479

 
13
%
 
551,101

 
13
%
 
537,784

 
12
%
 
525,954

 
12
%
 
539,065

 
14
%
Residential real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1-to-4 family mortgage
 
750,064

 
16
%
 
710,454

 
16
%
 
710,077

 
17
%
 
688,984

 
16
%
 
552,239

 
15
%
Residential line of credit
 
239,799

 
5
%
 
221,530

 
5
%
 
215,493

 
5
%
 
218,006

 
5
%
 
187,415

 
5
%
Multi-family mortgage
 
94,638

 
2
%
 
69,429

 
2
%
 
80,352

 
2
%
 
82,945

 
2
%
 
71,532

 
2
%
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
686,543

 
15
%
 
630,270

 
14
%
 
620,635

 
14
%
 
602,723

 
14
%
 
499,123

 
13
%
Non-owner occupied
 
910,822

 
20
%
 
920,744

 
21
%
 
914,502

 
21
%
 
922,150

 
22
%
 
816,880

 
22
%
Consumer and other
 
266,209

 
6
%
 
272,078

 
6
%
 
268,580

 
6
%
 
259,466

 
6
%
 
232,192

 
6
%
Total loans HFI
 
$
4,568,038

 
100
%
 
$
4,409,642

 
100
%
 
$
4,345,344

 
100
%
 
$
4,289,516

 
100
%
 
$
3,786,791

 
100
%
Allowance for credit losses rollforward
     summary
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses at the
beginning of the period
 
$
31,139

 
 

 
$
31,464

 
 
 
$
30,138

 
 
 
$
29,814

 
 
 
$
28,932

 
 
Impact of adopting ASC 326 (CECL) on
non-purchased credit deteriorated
loans
 
30,888

 
 
 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Impact of adopting ASC 326 (CECL) on
purchased credit deteriorated loans
 
558

 
 
 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Charge-offs
 
(2,411
)
 
 

 
(3,594
)
 
 
 
(717
)
 
 
 
(770
)
 
 
 
(871
)
 
 
Recoveries
 
334

 
 

 
319

 
 
 
212

 
 
 
213

 
 
 
362

 
 
Provision for credit losses
 
27,964

 
 

 
2,950

 
 
 
1,831

 
 
 
881

 
 
 
1,391

 
 
Initial allowance on acquired loans with
credit deterioration
 
669

 
 
 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Allowance for credit losses at the end of
the period
 
$
89,141

 
 

 
$
31,139

 
 
 
$
31,464

 
 
 
$
30,138

 
 
 
$
29,814

 
 
Allowance for credit losses as a
percentage of total loans HFI
 
1.95
%
 
 

 
0.71
%
 
 
 
0.72
%
 
 
 
0.70
%
 
 
 
0.79
%
 
 
Allowance for credit losses on unfunded
commitments
 
4,618

 
 
 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Charge-offs
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial and Industrial
 
$
(1,234
)
 
 

 
$
(2,669
)
 
 
 
$
(3
)
 
 
 
$
(79
)
 
 
 
$
(179
)
 
 
Construction
 
—

 
 

 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Residential real estate:
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1-to-4 family mortgage
 
(242
)
 
 

 
(138
)
 
 
 
—

 
 
 
(1
)
 
 
 
(81
)
 
 
Residential line of credit
 
—

 
 

 
(4
)
 
 
 
(170
)
 
 
 
(103
)
 
 
 
(32
)
 
 
Multi-family mortgage
 
—

 
 

 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Commercial real estate:
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
(209
)
 
 

 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Non-owner occupied
 
—

 
 

 
—

 
 
 
(12
)
 
 
 
—

 
 
 
—

 
 
Consumer and other
 
(726
)
 
 

 
(783
)
 
 
 
(532
)
 
 
 
(587
)
 
 
 
(579
)
 
 
Total charge-offs
 
(2,411
)
 
 

 
(3,594
)
 
 
 
(717
)
 
 
 
(770
)
 
 
 
(871
)
 
 
Recoveries
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial and Industrial
 
88

 
 

 
70

 
 
 
16

 
 
 
38

 
 
 
12

 
 
Construction
 
—

 
 

 
3

 
 
 
1

 
 
 
6

 
 
 
1

 
 
Residential real estate:
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1-to-4 family mortgage
 
24

 
 

 
17

 
 
 
25

 
 
 
24

 
 
 
13

 
 
Residential line of credit
 
15

 
 

 
17

 
 
 
75

 
 
 
21

 
 
 
25

 
 
Multi-family mortgage
 
—

 
 

 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Commercial real estate:
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owner occupied
 
14

 
 

 
13

 
 
 
3

 
 
 
5

 
 
 
87

 
 
Non-owner occupied
 
—

 
 

 
—

 
 
 
—

 
 
 
—

 
 
 
—

 
 
Consumer and other
 
193

 
 

 
199

 
 
 
92

 
 
 
119

 
 
 
224

 
 
Total recoveries
 
334

 
 

 
319

 
 
 
212

 
 
 
213

 
 
 
362

 
 
Net charge-offs
 
$
(2,077
)
 
 

 
$
(3,275
)
 
 
 
$
(505
)
 
 
 
$
(557
)
 
 
 
$
(509
)
 
 
Net charge-offs as a percentage of
average total loans
 
0.19
%
 
 

 
0.30
%
 
 
 
0.05
%
 
 
 
0.05
%
 
 
 
0.06
%
 
 
Loans classified as substandard
 
$
74,237

 
 

 
$
80,346

 
 
 
$
78,881

 
 
 
$
68,828

 
 
 
$
60,746

 
 

FB Financial Corporation
 
12



Loan Portfolio and Asset Quality
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2020
 
2019
 
 
First Quarter
 
 
 
Fourth Quarter
 
 
 
Third Quarter
 
 
 
Second Quarter
 
 
 
First Quarter
 
 
Nonperforming assets(a)(b)
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Past due 90 days or more and accruing
interest
 
$
6,459

 
 

 
$
5,543

 
 
 
$
2,452

 
 
 
$
2,100

 
 
 
$
1,885

 
 
Nonaccrual
 
24,547

 
 

 
21,062

 
 
 
17,911

 
 
 
16,135

 
 
 
13,721

 
 
Total nonperforming loans held for
investment
 
31,006

 
 

 
26,605

 
 
 
20,363

 
 
 
18,235

 
 
 
15,606

 
 
Loans held for sale
 
—

 
 

 
—

 
 
 
—

 
 
 
—

 
 
 
196

 
 
Other real estate owned:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreclosed
 
9,332

 
 

 
9,983

 
 
 
8,771

 
 
 
7,830

 
 
 
7,447

 
 
Excess land and facilities
 
7,740

 
 

 
8,956

 
 
 
7,305

 
 
 
7,691

 
 
 
5,381

 
 
Other assets
 
1,188

 
 

 
1,580

 
 
 
1,519

 
 
 
1,499

 
 
 
1,779

 
 
Total nonperforming assets
 
$
49,266

 
 

 
$
47,124

 
 
 
$
37,958

 
 
 
$
35,255

 
 
 
$
30,409

 
 
Total nonperforming loans as a
percentage of loans held for
investment
 
0.68
%
 
 

 
0.60
%
 
 
 
0.47
%
 
 
 
0.43
%
 
 
 
0.41
%
 
 
Total nonperforming assets as a
percentage of total assets
 
0.74
%
 
 

 
0.77
%
 
 
 
0.62
%
 
 
 
0.59
%
 
 
 
0.57
%
 
 
Total accruing loans over 90 days
delinquent as a percentage
of total assets
 
0.10
%
 
 

 
0.09
%
 
 
 
0.04
%
 
 
 
0.04
%
 
 
 
0.04
%
 
 
Loans restructured as troubled debt
restructurings
 
$
11,566

 
 

 
$
12,206

 
 
 
$
11,460

 
 
 
$
8,714

 
 
 
$
8,953

 
 
Troubled debt restructurings as a
percentage of loans held for
investment
 
0.25
%
 
 

 
0.28
%
 
 
 
0.26
%
 
 
 
0.20
%
 
 
 
0.24
%
 
 
(a) Upon adoption of CECL on January 1, 2020, purchase credit deteriorated loans are included in nonperforming assets on a prospective basis.
(b) Nonperforming assets includes guaranteed repurchased loans previously sold of $1.7 million, $2.7 million, $2.6 million, $1.5 million, and $3.4 million for the quarters ended March 31, 2020, December 31, 2019, September 30, 2019, June 30, 2019 and March 31, 2019, respectively.


FB Financial Corporation
 
13



Preliminary Capital Ratios
(Unaudited)
(In Thousands, Except %)
 
 
 
 
 
Computation of Tangible Common Equity to Tangible Assets:
 
March 31, 2020
 
December 31, 2019
 
 
 
 
 
Total Equity
 
$
782,330

 
$
762,329

Less:
 
 
 
 
    Goodwill
 
174,859

 
169,051

    Other intangibles
 
18,876

 
17,589

Tangible Common Equity
 
$
588,595

 
$
575,689

 
 
 
 
 
Total Assets
 
$
6,655,687

 
$
6,124,921

Less:
 
 
 
 
    Goodwill
 
174,859

 
169,051

    Other intangibles
 
18,876

 
17,589

Tangible Assets
 
$
6,461,952

 
$
5,938,281

 
 
 
 
 
Preliminary Total Risk-Weighted Assets
 
$
5,509,550

 
$
5,172,450

 
 
 
 
 
Total Common Equity to Total Assets
 
11.8
%
 
12.4
%
Tangible Common Equity to Tangible Assets*
 
9.11
%
 
9.7
%
 
 
 
 
 
 
 
 
 
 
 
 
March 31, 2020
 
December 31, 2019
Preliminary Regulatory Capital(a):
 
 

 
 
    Common Equity Tier 1 Capital
 
$
606,922

 
$
572,410

    Tier 1 Capital
 
636,922

 
602,410

    Total Capital
 
688,396

 
633,549

 
 
 
 
 
Preliminary Regulatory Capital Ratios:
 
 
 
 
    Common Equity Tier 1
 
11.0
%
 
11.1
%
    Tier 1 Risk-Based
 
11.6
%
 
11.6
%
    Total Risk-Based
 
12.5
%
 
12.2
%
    Tier 1 Leverage
 
10.3
%
 
10.1
%
(a) Reflects CECL transition relief of $31.8 million add-back and $37.7 million disallowed from add-back to Tier 2 capital.
*These measures are considered non-GAAP financial measures. See "GAAP Reconciliation and Use of Non-GAAP financial measures" and the corresponding financial tables below for a reconciliation and discussion of these non-GAAP measures.


FB Financial Corporation
 
14



Investment Portfolio
For the Quarters Ended
(Unaudited)
(In Thousands, Except %)
 
 
 
 
 
2020
 
2019
Securities (at fair value)
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Available-for-sale debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government agency securities
 
$
3,037

 
—
%
 
$
—

 
—
%
 
$
999

 
—
%
 
$
996

 
—
%
 
$
993

 
—
%
Mortgage-backed securities -
residential
 
499,658

 
65
%
 
490,676

 
71
%
 
485,300

 
72
%
 
517,505

 
77
%
 
511,716

 
77
%
Municipals, tax exempt
 
235,677

 
31
%
 
189,235

 
27
%
 
173,785

 
26
%
 
149,305

 
22
%
 
147,640

 
22
%
Treasury securities
 
24,860

 
3
%
 
7,448

 
1
%
 
7,432

 
1
%
 
7,409

 
1
%
 
7,305

 
1
%
Corporate securities
 
985

 
—
%
 
1,022

 
—
%
 
1,015

 
—
%
 
—

 
—
%
 
—

 
—
%
Total available-for-sale debt
securities
 
764,217

 
99
%
 
688,381

 
99
%
 
668,531

 
99
%
 
675,215

 
100
%
 
667,654

 
100
%
Equity securities
 
3,358

 
1
%
 
3,295

 
1
%
 
3,250

 
1
%
 
3,242

 
—
%
 
3,181

 
—
%
Total securities
 
$
767,575

 
100
%
 
$
691,676

 
100
%
 
$
671,781

 
100
%
 
$
678,457

 
100
%
 
$
670,835

 
100
%
Securities to total assets
 
11.5
%
 
 

 
11.3
%
 
 
 
11.0
%
 
 
 
11.4
%
 
 
 
12.6
%
 
 
Unrealized gain (loss) on available-for
-sale debt securities
 
$
28,058

 
 
 
$
11,676

 
 
 
$
12,436

 
 
 
$
7,303

 
 
 
$
(1,799
)
 
 


FB Financial Corporation
 
15



Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
2020
 
2019
Adjusted earnings
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
First Quarter
Pre-tax net income
 
$
825

 
$
27,290

 
$
31,684

 
$
25,002

$
25,563

Plus merger and mortgage restructuring expenses
 
3,050

 
686

 
407

 
4,612

1,675

Plus initial provision for credit losses on acquired loans
 
2,885

 
—

 
—

 
—

—

Adjusted pre-tax earnings
 
6,760

 
27,976

 
32,091

 
29,614

27,238

Income tax expense, adjusted
 
1,464

 
5,897

 
7,824

 
7,516

6,412

Adjusted earnings
 
$
5,296

 
$
22,079

 
$
24,267

 
$
22,098

$
20,826

Weighted average common shares outstanding-
fully diluted
 
31,734,112

 
31,470,565

 
31,425,573

 
31,378,018

31,349,198

Adjusted diluted earnings per share
 
 
 
 
 
 
 
 
 
Diluted earnings per common share
 
$
0.02

 
$
0.68

 
$
0.76

 
$
0.59

$
0.62

Plus merger and mortgage restructuring expenses
 
0.10

 
0.02

 
0.01

 
0.15

0.05

Plus initial provision for credit losses on acquired loans
 
0.09

 
—

 
—

 
—

—

Less tax effect
 
0.04

 
—

 
—

 
0.04

0.01

Adjusted diluted earnings per share
 
$
0.17

 
$
0.70

 
$
0.77

 
$
0.70

$
0.66

 
 
 
 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted pre-tax pre-provision earnings
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
First Quarter
Pre-tax net income
 
$
825

 
$
27,290

 
$
31,684

 
$
25,002

$
25,563

Plus provisions for credit losses
 
29,565

 
2,950

 
1,831

 
881

1,391

Pre-tax pre-provision earnings
 
30,390

 
30,240

 
33,515

 
25,883

26,954

Plus merger and mortgage restructuring expenses
 
3,050

 
686

 
407

 
4,612

1,675

Adjusted pre-tax pre-provision earnings
 
$
33,440

 
$
30,926

 
$
33,922

 
$
30,495

$
28,629

Weighted average common shares outstanding-
fully diluted
 
31,734,112
 
31,470,565
 
31,425,573
 
31,378,018
31,349,198
Adjusted pre-tax pre-provision diluted earnings per share
 
 
 
 
 
 
 
 
 
Diluted earnings per common share
 
$
0.02

 
$
0.68

 
$
0.76

 
$
0.59

$
0.62

Plus income tax expense
 
—

 
0.18

 
0.25

 
0.20

0.19

Plus provisions for credit losses
 
0.93

 
0.10

 
0.06

 
0.03

0.05

Pre-tax pre-provision earnings per share
 
0.95

 
0.96

 
1.07

 
0.82

0.86

Plus merger and mortgage restructuring expenses
 
0.10

 
0.02

 
0.01

 
0.15

0.05

Adjusted pre-tax pre-provision earnings per share
 
$
1.05

 
$
0.98

 
$
1.08

 
$
0.97

$
0.91


FB Financial Corporation
 
16



Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
 
 
 
 
 
 
Adjusted pro forma earnings*
 
YTD 2020

 
2019

 
2018

 
2017

 
2016

Pre-tax net income
 
$
825

 
$
109,539

 
$
105,854

 
$
73,485

 
$
62,324

Plus merger, conversion, offering, and mortgage
restructuring expenses
 
3,050

 
7,380

 
2,265

 
19,034

 
3,268

Plus initial provision for credit losses on acquired loans
 
2,885

 
—

 
—

 
—

 
—

Less significant (losses) gains on securities, other real estate owned
and other items
 
—

 
—

 
—

 
—

 
(3,539
)
Adjusted pre-tax earnings
 
6,760

 
116,919

 
108,119

 
92,519

 
69,131

Adjusted pro forma income tax expense
 
1,464

 
27,648

 
26,034

 
34,749

 
25,404

Adjusted pro forma earnings
 
$
5,296

 
$
89,271

 
$
82,085

 
$
57,770

 
$
43,727

Weighted average common shares outstanding- fully diluted
 
31,734,112

 
31,402,897

 
31,314,981

 
28,207,602

 
19,312,174

Adjusted pro forma diluted earnings per share*
 
 
 
 
 
 
 
 
 
 
Diluted earning per share
 
$
0.02

 
$
2.65

 
$
2.55

 
$
1.86

 
$
2.10

Plus merger, conversion, offering, and mortgage
restructuring expenses
 
0.10

 
0.24

 
0.07

 
0.67

 
0.17

Plus initial provision for credit losses on acquired loans
 
0.09

 
—

 
—

 
—

 
—

Less significant (losses) gains on securities, other real estate owned
   and other items
 
—

 
—

 
—

 
—

 
(0.18
)
Less tax effect and benefit of enacted tax laws
 
0.04

 
0.06

 
0.01

 
0.48

 
0.19

Adjusted pro forma diluted earnings per share
 
$
0.17

 
$
2.83

 
$
2.61

 
$
2.05

 
$
2.26

 *Prior to the IPO in the third quarter of 2016, the Company was an S corporation and did not incur federal income taxes. In conjunction with the IPO, the Company converted to a C corporation. These results are on a pro forma basis to reflect the results of the Company on a C corporation basis and combined effective tax rates of 35.08% for the year ended December 31, 2016.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted pre-tax pre-provision earnings
 
YTD 2020
 
2019
 
2018
 
2017
 
2016
Pre-tax net income
 
$
825

 
$
109,539

 
$
105,854

 
$
73,485

 
$
62,324

Plus provisions for credit losses
 
29,565

 
7,053

 
5,398

 
(950
)
 
(1,479
)
Pre-tax pre-provision earnings
 
30,390

 
116,592

 
111,252

 
72,535

 
60,845

Plus merger, conversion, offering, and mortgage
restructuring expenses
 
3,050

 
7,380

 
2,265

 
19,034

 
3,268

Less significant (losses) gains on securities, other real estate owned
   and other items
 
—

 
—

 
—

 
—

 
(3,539
)
Adjusted pre-tax pre-provision earnings
 
$
33,440

 
$
123,972

 
$
113,517

 
$
91,569

 
$
67,652

Weighted average common shares outstanding- fully diluted
 
31,734,112

 
31,402,897

 
31,314,981

 
28,207,602

 
19,312,174

Adjusted pre-tax pre-provision diluted earnings per share
 
 
 
 
 
 
 
 
 
 
Diluted earnings per common share
 
$
0.02

 
$
2.65

 
$
2.55

 
$
1.86

 
$
2.10

Plus income tax expense
 
—

 
0.82

 
0.83

 
0.75

 
1.13

Plus provisions for credit/ loan losses
 
0.93

 
0.23

 
0.17

 
(0.03
)
 
(0.08
)
Pre-tax pre-provision earnings per share
 
0.95

 
3.70

 
3.55

 
2.58

 
3.15

Plus merger, conversion, offering, and mortgage
restructuring expenses
 
0.10

 
0.24

 
0.07

 
0.67

 
0.17

Less significant (losses) gains on securities, other real estate owned
       and other items
 
—

 
—

 
—

 
—

 
(0.18
)
Adjusted pre-tax pre-provision diluted earnings per share
 
$
1.05

 
$
3.94

 
$
3.62

 
$
3.25

 
$
3.50




FB Financial Corporation
 
17



Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
2020
 
2019
Core efficiency ratio (tax-equivalent basis)
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Total noninterest expense
 
$
68,559

 
$
62,686

 
$
62,935

 
$
64,119

 
$
55,101

Less merger and mortgage restructuring expenses
 
3,050

 
686

 
407

 
4,612

 
1,675

Core noninterest expense
 
$
65,509

 
$
62,000

 
$
62,528

 
$
59,507

 
$
53,426

Net interest income (tax-equivalent basis)
 
$
56,784

 
$
58,212

 
$
58,769

 
$
57,488

 
$
53,461

Total noninterest income
 
42,700

 
35,234

 
38,145

 
32,979

 
29,039

Less (loss) gain on sales or write-downs of other
real estate owned and other assets
 
(277
)
 
277

 
(82
)
 
94

 
152

Less gain (loss) from securities, net
 
63

 
(18
)
 
(20
)
 
52

 
43

Core noninterest income
 
42,914

 
34,975

 
38,247

 
32,833

 
28,844

Core revenue
 
$
99,698

 
$
93,187

 
$
97,016

 
$
90,321

 
$
82,305

Efficiency ratio (GAAP)(a)
 
69.3
%
 
67.5
%
 
65.3
%
 
71.2
%
 
67.2
%
Core efficiency ratio (tax-equivalent basis)
 
65.7
%
 
66.5
%
 
64.5
%
 
65.9
%
 
64.9
%
(a) Efficiency ratio (GAAP) is calculated by dividing reported noninterest expense by reported total revenue.
 
 
 
 
 
2020
 
2019
Banking segment core efficiency ratio
(tax equivalent)
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Core consolidated noninterest expense
 
$
65,509

 
$
62,000

 
$
62,528

 
$
59,507

 
$
53,426

Less Mortgage segment core noninterest expense
 
17,567

 
14,956

 
15,686

 
17,835

 
17,486

Core Banking segment noninterest expense
 
$
47,942

 
$
47,044

 
$
46,842

 
$
41,672

 
$
35,940

Core revenue
 
$
99,698

 
$
93,187

 
$
97,016

 
$
90,321

 
$
82,305

Less Mortgage segment total revenue
 
22,110

 
16,193

 
18,455

 
19,119

 
16,658

Core Banking segment total revenue
 
$
77,588

 
$
76,994

 
$
78,561

 
$
71,202

 
$
65,647

Banking segment core efficiency ratio
(tax-equivalent basis)
 
61.8
%
 
61.1
%
 
59.6
%
 
58.5
%
 
54.7
%
 
 
 
 
 
 
 
 
 
 
 
Mortgage segment core efficiency ratio
(tax equivalent)
 
 
 
 
 
 
 
 
 
 
Mortgage segment noninterest expense
 
$
17,567

 
$
14,956

 
$
15,798

 
$
18,664

 
$
18,540

Less mortgage restructuring expense
 
—

 
—

 
112

 
829

 
1,054

Core Mortgage segment noninterest expense
 
$
17,567

 
$
14,956

 
$
15,686

 
$
17,835

 
$
17,486

Mortgage segment total revenue
 
$
22,110

 
$
16,193

 
$
18,455

 
$
19,119

 
$
16,658

Mortgage segment core efficiency ratio
(tax-equivalent basis)
 
79.5
%
 
92.4
%
 
85.0
%
 
93.3
%
 
N/M


FB Financial Corporation
 
18



Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
 
 
2020
 
2019
Adjusted mortgage contribution
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Mortgage segment pre-tax net contribution (loss)
 
$
4,543

 
$
1,237

 
$
2,657

 
$
455

 
$
(1,882
)
Retail footprint:
 
 
 
 
 
 
 
 
 
 
   Mortgage banking income
 
10,651

 
9,899

 
10,693

 
5,451

 
4,386

   Mortgage banking expenses
 
7,175

 
8,126

 
8,087

 
4,172

 
2,831

       Retail footprint pre-tax net contribution
 
3,476

 
1,773

 
2,606

 
1,279

 
1,555

Total mortgage banking pre-tax net (loss)
   contribution
 
$
8,019

 
$
3,010

 
$
5,263

 
$
1,734

 
$
(327
)
Plus mortgage restructuring expense
 
—

 
—

 
112

 
829

 
1,054

Total adjusted mortgage banking pre-tax net
    contribution (loss)
 
$
8,019

 
$
3,010

 
$
5,375

 
$
2,563

 
$
727

Pre-tax pre-provision earnings
 
$
30,390

 
$
30,240

 
$
33,515

 
$
25,883

 
$
26,954

% total mortgage banking pre-tax pre-provision net contribution
 
26.4
%
 
10.0
%
 
15.7
%
 
6.70
%
 
N/M

Adjusted pre-tax pre-provision earnings
 
$
33,440

 
$
30,926

 
$
33,922

 
$
30,495

 
$
28,629

% total adjusted mortgage banking pre-tax
pre-provision net contribution
 
24.0
%
 
9.73
%
 
15.8
%
 
8.40
%
 
2.54
%
 
 
 
 
 
 
 
 
 
 
 
 
 
2020
 
2019
Tangible assets and equity
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Tangible assets
 
 
 
 
 
 
 
 
 
 
Total assets
 
$
6,655,687

 
$
6,124,921

 
$
6,088,895

 
$
5,940,402

 
$
5,335,156

Less goodwill
 
174,859

 
169,051

 
168,486

 
168,486

 
137,190

Less intangibles, net
 
18,876

 
17,589

 
18,748

 
19,945

 
10,439

Tangible assets
 
$
6,461,952

 
$
5,938,281

 
$
5,901,661

 
$
5,751,971

 
$
5,187,527

Tangible common equity
 
 
 
 
 
 
 
 
 
 
Total shareholders' equity
 
$
782,330

 
$
762,329

 
$
744,835

 
$
718,759

 
$
694,577

Less goodwill
 
174,859

 
169,051

 
168,486

 
168,486

 
137,190

Less intangibles, net
 
18,876

 
17,589

 
18,748

 
19,945

 
10,439

Tangible common equity
 
$
588,595

 
$
575,689

 
$
557,601

 
$
530,328

 
$
546,948

Common shares outstanding
 
32,067,356

 
31,034,315

 
30,927,664

 
30,865,636

 
30,852,665

Book value per common share
 
$
24.40

 
$
24.56

 
$
24.08

 
$
23.29

 
$
22.51

Tangible book value per common share
 
$
18.35

 
$
18.55

 
$
18.03

 
$
17.18

 
$
17.73

Total shareholders' equity to total assets
 
11.8
%
 
12.4
%
 
12.2
%
 
12.1
%
 
13.0
%
Tangible common equity to tangible assets
 
9.11
%
 
9.69
%
 
9.45
%
 
9.22
%
 
10.5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
2020
 
2019
Return on average tangible common equity
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Total average shareholders' equity
 
$
768,929

 
$
761,949

 
$
731,701

 
$
708,557

 
$
684,545

Less average goodwill
 
171,532

 
168,492

 
168,486

 
167,781

 
137,190

Less average intangibles, net
 
18,152

 
18,242

 
19,523

 
20,214

 
10,856

Average tangible common equity
 
$
579,245

 
$
575,215

 
$
543,692

 
$
520,562

 
$
536,499

Net income
 
$
745

 
$
21,572

 
$
23,966

 
$
18,688

 
$
19,588

Return on average tangible common equity
 
0.52
%
 
14.9
%
 
17.5
%
 
14.4
%
 
14.8
%


FB Financial Corporation
 
19



Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
2020
 
2019
Adjusted return on average tangible common
equity
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Average tangible common equity
 
$
579,245

 
$
575,215

 
$
543,692

 
$
520,562

 
$
536,499

Adjusted net income
 
5,296

 
22,079

 
24,267

 
22,098

 
20,826

Adjusted return on average tangible common
equity
 
3.68
%
 
15.2
%
 
17.7
%
 
17.0
%
 
15.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted pre-tax pre-provision return on
average tangible common equity
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Average tangible common equity
 
$
579,245

 
$
575,215

 
$
543,692

 
$
520,562

 
$
536,499

Adjusted pre-tax pre-provision earnings
 
33,440

 
30,926

 
33,922

 
30,495

 
28,629

Adjusted pre-tax pre-provision return on
average tangible common equity
 
23.2
%
 
21.3
%
 
24.8
%
 
23.5
%
 
21.6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pro forma return on average tangible common
equity
 
YTD 2020
 
2019
 
2018
 
2017
 
2016
Total average shareholders' equity
 
$
768,929

 
$
723,494

 
$
629,922

 
$
466,219

 
$
276,587

Less average goodwill
 
171,532

 
160,587

 
137,190

 
84,997

 
46,867

Less average intangibles, net
 
18,152

 
17,236

 
12,815

 
8,047

 
5,353

Average tangible common equity
 
$
579,245

 
$
545,671

 
$
479,917

 
$
373,175

 
$
224,367

Pro forma net income
 
$
745

 
$
83,814

 
$
80,236

 
$
52,398

 
$
39,422

Pro forma return on average tangible common
equity
 
0.5
%
 
15.4
%
 
16.7
%
 
14.0
%
 
17.6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted pro forma return on average tangible
common equity
 
YTD 2020
 
2019
 
2018
 
2017
 
2016
Average tangible common equity
 
$
579,245

 
$
545,671

 
$
479,917

 
$
373,175

 
$
224,367

Adjusted pro forma net income
 
5,296

 
89,271

 
82,085

 
57,770

 
43,727

Adjusted pro forma return on average tangible
common equity
 
3.7
%
 
16.4
%
 
17.1
%
 
15.5
%
 
19.5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted pre-tax pre-provision return on average
tangible common equity
 
YTD 2020
 
2019
 
2018
 
2017
 
2016
Average tangible common equity
 
$
579,245

 
$
545,671

 
$
479,917

 
$
373,175

 
$
224,367

Adjusted pre-tax pre-provision earnings
 
33,440

 
123,972

 
113,517

 
91,569

 
67,652

Adjusted pre-tax pre-provision return on average
tangible common equity
 
23.2
%
 
22.7
%
 
23.7
%
 
24.5
%
 
30.2
%










FB Financial Corporation
 
20



Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted return on average assets and
equity
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Net income
 
$
745

 
$
21,572

 
$
23,966

 
$
18,688

 
$
19,588

Average assets
 
6,409,417

 
6,157,931

 
5,988,572

 
5,771,371

 
5,174,918

Average equity
 
768,929

 
761,949

 
731,701

 
708,557

 
684,545

Return on average assets
 
0.05
%
 
1.39
%
 
1.59
%
 
1.30
%
 
1.54
%
Return on average equity
 
0.39
%
 
11.2
%
 
13.0
%
 
10.6
%
 
11.6
%
Adjusted net income
 
$
5,296

 
$
22,079

 
$
24,267

 
$
22,098

 
$
20,826

Adjusted return on average assets
 
0.33
%
 
1.42
%
 
1.61
%
 
1.54
%
 
1.63
%
Adjusted return on average equity
 
2.77
%
 
11.5
%
 
13.2
%
 
12.5
%
 
12.3
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2020
 
2019
Adjusted pre-tax pre-provision return on
average assets and equity
 
First Quarter
 
Fourth Quarter
 
Third Quarter
 
Second Quarter
 
First Quarter
Net income
 
$
745

 
$
21,572

 
$
23,966

 
$
18,688

 
$
19,588

Average assets
 
6,409,417

 
6,157,931

 
5,988,572

 
5,771,371

 
5,174,918

Average equity
 
768,929

 
761,949

 
731,701

 
708,557

 
684,545

Return on average assets
 
0.05
%
 
1.39
%
 
1.59
%
 
1.30
%
 
1.54
%
Return on average equity
 
0.39
%
 
11.2
%
 
13.0
%
 
10.6
%
 
11.6
%
Adjusted pre-tax pre-provision earnings
 
$
33,440

 
$
30,926

 
$
33,922

 
$
30,495

 
$
28,629

Adjusted pre-tax pre-provision return on
average assets
 
2.10
%
 
1.99
%
 
2.25
%
 
2.12
%
 
2.24
%
Adjusted pre-tax pre-provision return on
average equity
 
17.5
%
 
16.1
%
 
18.4
%
 
17.3
%
 
17.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted pro forma return on average
assets and equity
 
YTD 2020
 
2019
 
2018
 
2017
 
2016
Pro forma net income
 
$
745

 
$
83,814

 
$
80,236

 
$
52,398

 
$
39,422

Average assets
 
6,409,417

 
5,777,672

 
4,844,865

 
3,811,158

 
3,001,275

Average equity
 
768,929

 
723,494

 
629,922

 
466,219

 
276,587

Pro forma return on average assets
 
0.05
%
 
1.45
%
 
1.66
%
 
1.37
%
 
1.31
%
Pro forma return on average equity
 
0.39
%
 
11.6
%
 
12.7
%
 
11.2
%
 
14.3
%
Adjusted pro forma net income
 
$
5,296

 
$
89,271

 
$
82,085

 
$
57,770

 
$
43,727

Adjusted pro forma return on average
assets
 
0.33
%
 
1.55
%
 
1.69
%
 
1.52
%
 
1.46
%
Adjusted pro forma return on average
equity
 
2.77
%
 
12.3
%
 
13.0
%
 
12.4
%
 
15.8
%

FB Financial Corporation
 
21



Non-GAAP Reconciliation
For the Periods Ended
(Unaudited)
(In Thousands, Except Share Data and %)
 
 
 
 
 
 
 
 
 
 
 
Adjusted pre-tax pre-provision return on
average assets and equity
 
YTD 2020
 
2019
 
2018
 
2017
 
2016
Pro forma net income
 
$
745

 
$
83,814

 
$
80,236

 
$
52,398

 
$
39,422

Average assets
 
6,409,417

 
5,777,672

 
4,844,865

 
3,811,158

 
3,001,275

Average equity
 
768,929

 
723,494

 
629,922

 
466,219

 
276,587

Pro forma return on average assets
 
0.05
%
 
1.45
%
 
1.66
%
 
1.37
%
 
1.31
%
Pro forma return on average equity
 
0.39
%
 
11.6
%
 
12.7
%
 
11.2
%
 
14.3
%
Adjusted pre-tax pre-provision earnings
 
$
33,440

 
$
123,972

 
$
113,517

 
$
91,569

 
$
67,652

Adjusted pre-tax pre-provision return on
average assets
 
2.10
%
 
2.15
%
 
2.34
%
 
2.40
%
 
2.25
%
Adjusted pre-tax pre-provision return on
average equity
 
17.5
%
 
17.1
%
 
18.0
%
 
19.6
%
 
24.5
%

FB Financial Corporation
 
22
First Quarter 2020 Earnings Presentation April 28, 2020

 
IMPORTANT INFORMATION FOR SHAREHOLDERS AND INVESTORS In connection with the proposed merger with Franklin, FB Financial will file a registration statement on Form S-4 with the SEC. The registration statement will contain the joint proxy statement of Franklin and FB Financial to be sent to the FB Financial and Franklin shareholders seeking their approvals in connection with the merger and the issuance of FB Financial common stock in the merger. The registration statement will also contain the prospectus of FB Financial to register the shares of FB Financial common stock to be issued in connection with the merger. A definitive joint proxy statement/prospectus will also be provided to FB Financial and Franklin shareholders as required by applicable law. Investors and shareholders are encouraged to read the registration statement, including the joint proxy statement/prospectus that will be part of the registration statement, as well as any other relevant documents filed by FB Financial and Franklin with the SEC, including any amendments or supplements to the registration statement and other documents filed with the SEC, because they will contain important information about the Franklin merger, Franklin, and FB Financial. The registration statement and other documents filed with the SEC may be obtained for free on the SEC’s website (www.sec.gov). The definitive proxy statement/prospectus will also be made available for free by contacting FB Financial Corporation Investor Relations at (615) 564-1212 or [email protected], or by contacting Franklin Investor Relations at (615) 236-8327 or [email protected]. This press release does not constitute an offer to sell, the solicitation of an offer to sell or the solicitation of an offer to buy any securities, or the solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. PARTICIPANTS IN THE SOLICITATION FB Financial, Franklin, and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from FB Financial and Franklin shareholders in connection with the proposed Franklin merger under the rules of the SEC. Information about the directors and executive officers of FB Financial may be found in the definitive proxy statement for FB Financial’s 2019 annual meeting of shareholders, filed with the SEC by FB Financial on April 16, 2019, and other documents subsequently filed by FB Financial with the SEC. Information about the directors and executive officers of Franklin may be found in the definitive proxy statement for Franklin’s 2019 annual meeting of shareholders, filed with the SEC by Franklin on April 12, 2019, and other documents subsequently filed by Franklin with the SEC. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus when it becomes available. Free copies of these documents may be obtained as described in the paragraph above. 1

 
Forward–Looking Statements Certain statements contained in this press release may constitute 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 include, without limitation, statements regarding the projected impact of the COVID-19 global pandemic on our business operations, statements relating to the timing, benefits, costs, and synergies of the proposed merger with Franklin Financial Network, Inc. (“Franklin”) (the “Franklin merger”) and of the recent merger with FNB Financial Corp. (“FNB”) (together with the Franklin merger, the “mergers”), and FB Financial’s future plans, results, strategies, and expectations. These statements can generally be identified by the use of the words and phrases “may,” “will,” “should,” “could,” “would,” “goal,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target,” “aim,” “predict,” “continue,” “seek,” “projection,” and other variations of such words and phrases and similar expressions. These forward-looking statements are not historical facts, and are based upon current expectations, estimates, and projections, many of which, by their nature, are inherently uncertain and beyond FB Financial’s control. The inclusion of these forward-looking statements should not be regarded as a representation by FB Financial or any other person that such expectations, estimates, and projections will be achieved. Accordingly, FB Financial cautions shareholders and investors 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. Actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements including, without limitation, (1) current and future economic conditions, including the effects of declines in housing and commercial real estate prices, high unemployment rates, and any slowdown in economic growth in the local or regional economies in which we operate and/or the US economy generally, (2) the effects of the COVID-19 pandemic, including the magnitude and duration of the pandemic and its impact on general economic and financial market conditions and on our business and our customers' business, results of operations, asset quality and financial condition, (3) changes in government interest rate policies, (4) our ability to effectively manage problem credits, (5) the risk that the cost savings and any revenue synergies from the mergers or another acquisition may not be realized or may take longer than anticipated to be realized, (6) disruption from the mergers with customer, supplier, or employee relationships, (7) the occurrence of any event, change, or other circumstances that could give rise to the termination of the merger agreement with Franklin, (8) the failure to obtain necessary regulatory approvals for the Franklin merger, (9) the failure to obtain the approval of FB Financial and Franklin’s shareholders in connection with the Franklin merger, (10) the possibility that the costs, fees, expenses, and charges related to the mergers may be greater than anticipated, including as a result of unexpected or unknown factors, events, or liabilities, (11) the failure of the conditions to the Franklin merger to be satisfied, (12) the risks related to the integrations of the combined businesses following the mergers, including the risk that the integrations will be materially delayed or will be more costly or difficult than expected, (13) the diversion of management time on issues related to the mergers, (14) the ability of FB Financial to effectively manage the larger and more complex operations of the combined company following the Franklin merger, (15) the risks associated with FB Financial’s pursuit of future acquisitions, (16) reputational risk and the reaction of the parties’ respective customers to the mergers, (17) FB Financial’s ability to successfully execute its various business strategies, including its ability to execute on potential acquisition opportunities, (18) the risk of potential litigation or regulatory action related to the Franklin merger, and (19) general competitive, economic, political, and market conditions. Further information regarding FB Financial and factors that could affect the forward-looking statements contained herein can be found in FB Financial's Annual Report on Form 10-K for the fiscal year ended December 31, 2019, and its other filings with the Securities and Exchange Commission (the “SEC”). Many of these factors are beyond FB Financial’s ability to control or predict. If one or more events related to these or other risks or uncertainties materialize, or if the underlying assumptions prove to be incorrect, actual results may differ materially from the forward-looking statements. Accordingly, shareholders and investors should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date of this press release, and FB Financial undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for FB Financial to predict their occurrence or how they will affect the company. FB Financial qualifies all forward-looking statements by these cautionary statements. 2

 
Use of non-GAAP financial measures This presentation contains certain financial measures that are not measures recognized under U.S. generally accepted accounting principles (“GAAP”) and therefore are considered non-GAAP financial measures. These non‐GAAP financial measures include, without limitation, adjusted net income, adjusted diluted earnings per share, adjusted pro forma net income, adjusted pro forma diluted earnings per share, pre-tax, pre-provision earnings, adjusted pre-tax, pre- provision earnings, adjusted pre-tax, pre-provision earnings per share, core noninterest expense, core revenue, core noninterest income, core efficiency ratio (tax-equivalent basis), banking segment core efficiency ratio (tax-equivalent basis), mortgage segment core efficiency ratio (tax-efficiency basis), adjusted mortgage contribution, adjusted return on average assets, equity and tangible common equity, pre-tax, pre-provision return on average assets, equity and tangible common equity, pro forma return on average assets and equity, pro forma adjusted return on average assets, equity and tangible common equity and adjusted pre-tax, pre-provision return on average assets, equity and tangible common equity. Each of these non-GAAP metrics excludes certain income and expense items that the Company’s management considers to be non‐core/adjusted in nature. The Company refers to these non‐GAAP measures as adjusted or core measures. The corresponding Earnings Release also presents tangible assets, tangible common equity, tangible book value per common share, tangible common equity to tangible assets, return on tangible common equity, return on average tangible common equity, and adjusted return on average tangible common equity. Each of these non-GAAP metrics excludes the impact of goodwill and other intangibles. The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance, financial condition and the efficiency of its operations as management believes such measures facilitate period-to-period comparisons and provide meaningful indications of its operating performance as they eliminate both gains and charges that management views as non-recurring or not indicative of operating performance. Management believes that these non-GAAP financial measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods as well as demonstrating the effects of significant non-core gains and charges in the current and prior periods. The Company’s management also believes that investors find these non-GAAP financial measures useful as they assist investors in understanding the Company’s underlying operating performance and in the analysis of ongoing operating trends. In addition, because intangible assets such as goodwill and other intangibles, and the other items excluded each vary extensively from company to company, the Company believes that the presentation of this information allows investors to more easily compare the Company’s results to the results of other companies. However, the non-GAAP financial measures discussed herein should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which the Company calculates the non-GAAP financial measures discussed herein may differ from that of other companies reporting measures with similar names. You should understand how such other banking organizations calculate their financial measures similar or with names similar to the non-GAAP financial measures the Company has discussed herein when comparing such non-GAAP financial measures. The following tables provide a reconciliation of these measures to the most directly comparable GAAP financial measures. 3

 
Aggressively managing for impact of COVID-19 .Reprioritized objectives early: 1. Health and Safety 2. Liquidity 3. Capital 4. Profitability 5. Growth .Liquidity: $4.2 billion of on-balance sheet and contingent liquidity; Loans HFI / Deposits of 85% Prepared for .Capital: Strong current capital levels and fortified allowance for credit losses Downturn .Profitability: Aggressively lowered rates on interest-bearing deposits across all products on March 17, 2020; $806 million, or 37%, of variable rate loans at floors at March 31, 2020 .Growth: Focused on core customer deposit growth to support liquidity; cautious loan growth with a focus on customers .Have retained all employees; engaging underutilized associates with special projects, such as Paycheck Protection Program involvement. Employee morale is high .Associates unable to work from home and not essential to day-to-day activities receiving normal Protecting pay Associates .Implemented a remote working environment for associates on March 16th .Suspended branch lobby service on March 19th; serving customers through drive throughs; in- person meetings by appointment only .Accepting PPP applications since April 4th; $267 million of loans approved by the SBA through April 16th; preparing for the second round of PPP to open .Offering payment deferrals since mid-March: $594 million in commercial and $87 million in Serving consumer deferrals through April 231 Customers .Playing a leadership role in our communities: providing meals to frontline workers, donating to foodbanks, assisting local governments .Have never stopped facilitating commerce in our communities ¹ Balances based on deferral participants’ loan balances outstanding as of March 31, 2020 4

 
Assisting customers in the face of uncertainty Deferral Programs Paycheck Protection Program . Offering relief in the form of deferral programs for all . Began accepting applications on April 4th customers who request assistance . Over 300 associates involved in application, approval and . Began proactively reaching out to consumer and SBA submission process, or ~50% of banking segment commercial customers in mid-March teammates . Standard consumer loan receiving 2-payment relief; . Received SBA approvals on over 1,500 applications maintaining dialogue in the interim for decisions on representing $267 million prior to funding running out on extensions April 16th – 726 consumer, residential mortgage, and HELOC loans have received modifications as of April 23rd . Approximately 29 thousand employed by companies receiving PPP loans from FirstBank – $87 million of loans participating1, or 6.9% of outstanding balances as of March 31st . Average loan size of $177 thousand . Of $7 billion unpaid principal balance in mortgage servicing – $66 million in loans above $2 million portfolio, ~5% have received forbearances – $102 million between $350 thousand and $2 million . Standard commercial loan receiving 90 day principal and interest forbearance, maintaining dialogue in the interim for – $99 million below $350 thousand decisions on extensions – 692 C&I, Construction, Multifamily and CRE loans have . Expect fees of approximately $5.7 million, net of direct received modifications as of April 23rd costs of origination, deferred over the life of the loan – $594 million of loans participating1, or 17.9% of outstanding balances as of March 31st ¹ Balances based on deferral participants’ loan balances outstanding as of March 31, 2020 5

 
1Q 2020 highlights Key highlights Financial results  Proactively addressing the impact of the COVID-19 virus on our 1Q 2020 associates, customers, communities and stakeholders Diluted earnings per share $0.02  Increased on-balance sheet liquidity to 12.0% of tangible assets from Adjusted diluted earnings per share¹ $0.17 9.2% in 4Q 2019; lowered loans HFI / deposits to 85% Net income ($mm) $0.7  Adopted CECL, increased ACL / Gross Loans HFI to 1.95% Adjusted net income¹ ($mm) $5.3  Adjusted pre-tax, pre-provision earnings1 of $33.4 million, up 8.1% Return on average assets 0.05% over 4Q 2019, resulting in adjusted pre-tax, pre-provision ROAA1 of 2.10% Return on average equity 0.4%  Continued customer-focused balance sheet growth resulting in a net interest margin of 3.92% for 1Q 2020 Adjusted pre-tax, pre-provision earnings1 ($mm) $33.4 – Contractual yield on loans of 5.14%, down 13 bps from 4Q 2019 Adjusted pre-tax, pre-provision return on average 2.10% – Cost of total deposits of 0.94%, down 8 bps from 4Q 2019 assets1  Total pre-tax mortgage contribution of $8.0 mm in 1Q 2020 Adjusted pre-tax, pre-provision return on average 23.2%  Loans (HFI) grew to $4.6 bn, a 20.6% increase from 1Q 2019 tangible common equity¹ – 5.9% year-over-year organic growth Net interest margin 3.92% Impact of accretion and nonaccrual interest (bps) 13  Customer deposits grew to $5.4 bn, a 26.3% increase from Efficiency ratio 69.3% 1Q 2019 Core efficiency ratio¹ 65.7% – 7.4% year-over-year organic growth Tangible common equity / tangible assets¹ 9.1%  Completed acquisition of FNB Financial Corporation on February 14, 2020; announced acquisition of Franklin Financial Network, Inc. on January 21, 2020 ¹ Results are non-GAAP financial measures that adjust GAAP reported net income, total assets, equity and other metrics for certain intangibles, income and expense items as outlined in the non-GAAP reconciliation calculations, using a combined marginal income tax rate of 26.06% excluding one-time items. See “Use of non-GAAP financial measures” and the Appendix hereto for a discussion and reconciliation of non-GAAP financial measures 6

 
Strong liquidity position  Customer deposit base has seen consistent growth over the On Balance Sheet Liquidity past 12 months and remains a stable base of funding and liquidity On-Balance Sheet Liqudity On balance sheet liquidity / tangible assets $773.5  Utilizing Federal Reserve PPP Lending Facility to fund PPP $800.0 loans as needed $700.0 $547.9 $581.4 $550.7 $600.0 $532.8  Monitoring liquidity in secondary mortgage markets and $500.0 $400.0 12.0% 10.3% impact of servicing requirements $300.0 9.5% 9.8% 9.2% $200.0  Isolated and limited draw downs on commercial lines and $100.0 HELOC since mid-March, continue daily monitoring $- 1Q19 2Q19 3Q19 4Q19 1Q20 Loans HFI / Customer Deposits Sources of Liquidity 1Q 2020 89.7% 89.3% 89.1% 88.7% Current On-Balance Sheet: Cash and Equivalents $425.1 85.3% Unpledged Securities 345.0 Equity Securities 3.4 Total On-Balance Sheet $773.5 Available Sources of Liquidity: Brokered CDs and Unsecured Lines $1,911.1 FHLB 466.1 Discount Window 1,056.4 Total Available Sources $3,433.6 1Q19 2Q19 3Q19 4Q19 1Q20 7

 
Core deposit franchise provides stable liquidity Total deposits ($mm) Cost of deposits Customer deposits Brokered and internet time deposits Noninterest bearing (%) Cost of total deposits (%) 30.0% 24.7% 24.5% 24.8% $5,377 25.0% 23.0% 22.4% $4,843 $4,922 $4,935 $20 20.0% 1.14% 1.14% $30 $25 $20 1.11% $4,303 1.02% 15.0% 0.94% $61 $5,357 $4,813 $4,897 $4,915 10.0% $4,242 5.0% 0.0% 1Q19 2Q19 3Q19 4Q19 1Q20 1Q19 2Q19 3Q19 4Q19 1Q20 Noninterest bearing deposits ($mm) Deposit composition Time 23% Noninterest- bearing checking 25% Savings $1,336 5% $1,214 $1,208 $1,112 Interest-bearing $965 checking Money market 21% 26% 1Q19 2Q19 3Q19 4Q19 1Q20 46% Checking accounts ¹ Includes mortgage servicing-related deposits of $70.1mm, $70.4mm, $121.4mm, $92.6mm and $110.1mm for the quarters ended March 31, 2019, June 30, 2019, September 30, 2019, December 31, 2019 and March 31, 2020, respectively. 8

 
Well-capitalized headed into recession Capital position Tangible book value per share2 1Q19 4Q19 1Q201 $18.55 $18.35 Shareholder’s 13.0% 12.4% 11.8% equity/Assets $11.56 $11.58 TCE/TA² 10.5% 9.7% 9.1% 3Q16 4Q16 4Q19 1Q20 Common equity 12.0% 11.1% 11.0% tier 1/Risk-weighted Simple capital structure assets Tier 1 capital/Risk- 12.7% 11.6% 11.6% Trust Preferred Tier 2 ACL weighted assets 4% 8% Total capital/Risk- 13.4% 12.2% 12.5% weighted assets Common Equity Tier 1 Capital 88% Tier 1 capital 11.5% 10.1% 10.3% /Average assets Total regulatory capital: $6881 mm ¹ Total regulatory capital, FB Financial Corporation. 1Q 2020 calculation is preliminary and subject to change. For regulatory capital purposes, the CECL impact over 2020 and 2021 is gradually phased- in from Common Equity Tier 1 Capital to Tier 2 capital. As of March 31, 2020, $31.8 million is being added back to CET 1 and Tier 1 Capital, and $37.7 million is being taken out of Tier 2 capital. ² See “Use of non-GAAP financial measures” and the Appendix hereto for a discussion and reconciliation of non-GAAP measures. 9

 
Consistent loan growth and balanced portfolio Portfolio mix C&I1 Exposure by Industry Other Balance 6% 1-4 family C&I CRE-OO Total % of Total 16% Real Estate Rental and Leasing $ 286.8 $ 103.8 $ 390.6 22.9% Retail Trade 70.5 101.9 172.4 10.1% 1-4 family HELOC Wholesale Trade 115.2 45.1 160.3 9.4% 5% Manufacturing 80.0 55.0 135.0 7.9% Finance and Insurance 116.8 14.3 131.1 7.7% Multifamily 1 Health Care and Social Assistance 56.1 73.4 129.5 7.6% C&I 2% Other Services (except Public Administration) 16.2 79.8 95.9 5.6% 38% Transportation and Warehousing 61.8 13.9 75.7 4.4% C&D Accomodation and Food Services 23.5 51.2 74.6 4.4% 13% Construction 42.7 22.5 65.1 3.8% Arts, Entertainment and Recreation 22.8 35.1 57.9 3.4% Professional, Scientific and Technical Services 26.0 15.6 41.6 2.4% Other 102.1 75.0 177.1 10.4% Total $ 1,020.5 $ 686.5 $ 1,707.0 100.0% 2 CRE 20% Total loan growth3 ($million) and commercial real estate concentration % of Risk-Based Capital Commercial real estate (CRE) 4 1Q20 concentrations 4Q19 (preliminary) C&D loans subject to 100% risk- 88% 86% $4,568 based capital threshold $4,290 $4,345 $4,410 $3,787 Total CRE loans subject to 300% 247% 231% risk-based capital threshold2 1Q19 2Q19 3Q19 4Q19 1Q20 1 C&I includes owner-occupied CRE. 2 Excludes owner-occupied CRE. 3 Exclude HFS loans. 4 Risk-based capital at FirstBank as defined in Call Report. 1Q 2020 calculation is preliminary and subject to change. 10

 
Industries of concern  Concentrations representative of community bankers Industry exposures / gross loans (HFI) serving customers across our communities 8.6%  Focused on in-market relationship banking  Diversified portfolio across the footprint with solid asset quality entering 2020 5.6%  3 SNC credits in entire portfolio with less than $75 million in 4.2% total balances – all were existing FirstBank customers prior to joining the syndication 2.5% 2.3%  Limited direct energy exposure, less than $10 million; 1.4% monitoring manufactured housing’s performance in impacted regions Retail Healtchare Hotel Transportation Other Leisure Restaurant Credit quality Deferral participants Deferral Program 93.5% 4/23/20 3/31/20 Participants Balances Retail 103 $ 131.8 Healthcare 79 38.9 Hotel 33 122.7 Transportation 29 3.7 Other Leisure 28 33.5 Restaurant 68 39.5 Total Industries of Concern 340 370.2 Other Loans HFI 1,078 310.3 Total Loans HFI 1,418 $ 680.5 3.1% 1.2% 2.2% Industries of Concern / Total 24.0% 54.4% Pass Watch Special Mention Substandard Note: Exposures included will differ from “C&I Exposure by Industry” table on slide 10 due to inclusion of non-owner occupied and other balances as well as additional tangential exposures. 11

 
Retail portfolio – 8.6% of gross loans HFI  53% C&I/CRE-OO and 47% CRE Non-OO and Other Portfolio overview  CRE Non-owner occupied and Other has no major Car, RV, Boat and concentrations by tenant ATV Dealers 22% – Portfolio benefits from conservative underwriting parameters which typically require personal guaranties Gas Stations and Non-Owner Occ / Other – Largest non-owner occupied loan is ~$8 million, fully Convenience Stores CRE 5% leased with 69% LTV. Tenants include national retailers 47% Pharmacies and drug stores and fitness franchise 3% Sporting goods  C&I / CRE-OO portfolio well-diversified across industries 3% and footprint Other Retailers < 3% – Largest relationship ~$20 million auto dealer across 20% multiple dealerships Credit quality Deferral participants Deferral Program 95.5% 4/23/20 3/31/20 Participants Balances CRE Non-OO and Other 47 $ 74.5 C&I and CRE-OO: Car, RV, Boat & ATV Dealers 14 $ 42.2 Gas Stations and C-Stores 7 3.5 Pharmacies & Drug Stores 1 0.4 Sporting Goods 1 0.1 Other Retailers 33 11.2 Total C&I and CRE-OO 56 $ 57.4 2.1% 0.6% 1.8% Total Retail Deferrals 103 $ 131.8 Pass Watch Special Mention Substandard Note: Exposures included will differ from “C&I Exposure by Industry” table on slide 10 due to inclusion of non-owner occupied and other balances as well as additional tangential exposures. 12

 
Healthcare & social assistance portfolio – 5.6% of loans HFI  Portfolio diversified over several segments across the Portfolio overview footprint Other Healthcare Assisted Living /  Assisted Living / Nursing Care / Continuing Care property and Social Nursing Care / Assistance Continuing Care types include assisted living with the largest loan ~$10M, 27% 35% one continuing care facility loan ~$21M, and skilled nursing care operators with the largest loan outstanding of ~$11M  Loans to offices of physicians are spread across the franchise Mental Health and Substance Abuse  Mental health and substance abuse includes a ~$28 million 14% credit in good standing Offices of Physicians 24% Credit quality Deferral participants Deferral Program 95.2% 4/23/20 3/31/20 Participants Balances Assisted Living / Nursing Care / Continuing - $ - Care Offices of Physicians 66 23.8 Mental Health and Substance Abuse 4 5.3 Other Healthcare and Social Assistance 9 9.8 Total Healthcare and Social Assistance 1.8% 3.0% 79 $ 38.9 0.0% Deferrals Pass Watch Special Mention Substandard Note: Exposures included will differ from “C&I Exposure by Industry” table on slide 10 due to inclusion of non-owner occupied and other balances as well as additional tangential exposures. 13

 
Hotel portfolio – 4.2% of gross loans HFI  Portfolio built around long-term successful hotel operators and Outstanding by location strong flags  Out of Market Properties concentrated in limited service facilities with reduced 8% reliance on food and beverage revenues Other Community 7%  Project exposure risk reduced based upon conservative hold Nashville MSA levels and participations sold strategies 35% – Largest single project exposure is $23 million Other MSA 13% – $75 million outstanding to 5 loans with $10 million - $23 million in balances – Remaining $117 million in outstandings spread across 79 Bowling Green MSA properties 10%  33 deferral participants as of April 23rd with $122.7 million Memphis MSA Atlanta MSA 16% outstanding based on March 31 balances 11% Credit quality Outstanding by flag Other 92.5% 11% Best Western / Choice Hilton / IHG / Marriott / / Red Lion / Red Roof Wyndham 12% 77% 1.7% 2.2% 3.6% Pass Watch Special Mention Substandard Note: Exposures included will differ from “C&I Exposure by Industry” table on slide 10 due to inclusion of non-owner occupied and other balances as well as additional tangential exposures. 14

 
Transportation and warehousing – 2.5% of gross loans HFI  Trucking related exposure includes truckload operators, Portfolio overview equipment lessors to owner/operators, and local Other franchisees of major national trucking companies. Largest Transportation and Warehousing relationship ~$26 million 12%  Air travel and support related is primarily diversified across Consumer Charter Transportation multiple owners and/or operators. No commercial airline 11% exposure. Largest loan ~$12M to an in-market operator with strong financial wherewithal Trucking 55%  Consumer charter transportation is largely associated with Air Travel and Support an in-market operator with strong financial wherewithal 22% Credit quality Deferral participants Deferral Program 87.1% 4/23/20 3/31/20 Participants Balances ($m) Trucking 23 $ 2.4 Air Travel and Support - - Consumer Charter 1 0.3 Transportation Other 5 0.9 12.4% Total Transportation and 29 $ 3.7 0.0% 0.5% Warehousing Pass Watch Special Mention Substandard Note: Exposures included will differ from “C&I Exposure by Industry” table on slide 10 due to inclusion of non-owner occupied and other balances as well as additional tangential exposures. 15

 
Other Leisure – 2.3% of gross loans HFI  Diversified portfolio across the footprint encompassing a Portfolio overview myriad of customers and types Other <5% 15% Marinas  Largest exposures include: 20% – ~$15M to an entertainment venue with strong collateral Theaters 9% – Multiple marinas across the franchise with the largest ~$8M Sports Teams and RV Parks and Clubs Campgrounds 9% 17% – ~$11M to professional sports teams, well-secured – One theater location ~$9M Historical Sites Fitness and Rec Sports 14% Centers 16% Credit quality Deferral participants Deferral Program 95.9% 4/23/20 3/31/20 Participants Balances Marinas 4 $ 14.0 RV Parks and Campgrounds 2 1.0 Fitness and Recreational Sports Centers 5 2.5 Historical Sites - - Sports Teams and Clubs - - Theaters 4 9.4 Other 13 6.6 2.3% 0.8% 1.0% Total Other Leisure 28 $ 33.5 Pass Watch Special Mention Substandard Note: Exposures included will differ from “C&I Exposure by Industry” table on slide 10 due to inclusion of non-owner occupied and other balances as well as additional tangential exposures. 16

 
Restaurant – 1.4% of gross loans HFI  No major concentration by operator or brand Portfolio overview  Largest single customer ~$4M, secured by real estate. Other 5% Strong local independent operator Bars 7%  Portfolio distributed across the footprint  Expectations include varying levels of impact by operator. Ability to adapt to their local restrictions on service and length of restrictions will determine their success Limited Service 30% Full Service  Not included in this exposure disclosure is a diversified food 58% company which derives a majority of its revenues from direct to consumer sales, but does also own certain retail outlets, exposure ~$25M Credit quality Deferral participants Deferral Program 84.9% 4/23/20 3/31/20 Participants Balances ($m) Full Service Restaurants 36 $ 23.6 Limited-Service Restaurants 23 13.4 Bars 6 2.1 Other - 0.4 10.4% 3.0% 1.7% Total Restaurants 68 $ 39.5 Pass Watch Special Mention Substandard Note: Exposures included will differ from “C&I Exposure by Industry” table on slide 10 due to inclusion of non-owner occupied and other balances as well as additional tangential exposures. 17

 
Allowance for credit losses overview  Current Expected Credit Loss (CECL) Allowance for Credit Losses (ACL) model utilizes Moody’s baseline economic forecast issued on April 4, 2020 and a 3 year forecast period, summary below1: FQE, FYE 12/31, 2Q 2020 3Q 2020 4Q 2020 2020 2021 2022 GDP (bcw$) $ 18,156.3 $ 18,634.0 $ 18,744.0 $ 18,658.3 $ 19,158.2 $ 20,063.4 Annualized % Change (18.3%) 10.9% 2.4% (2.2%) 2.7% 4.7% Total Employment (millions) 144.2 148.0 147.8 148.0 148.4 151.7 Unemployment Rate 8.7% 6.3% 6.5% 6.3% 6.6% 5.2% CRE Price Index 287.2 271.4 265.5 265.5 284.7 318.3 NCREIF Property Index: Rate of Return (3.4%) (10.1%) 3.1% (2.3%) 2.7% 3.8%  Initial adoption of CECL, increased ACL from $31.1 million at December 31, 2019 to $62.6 million at January 1, 2020 with a net adjustment to retained earnings of $25.0 million, net of tax  CECL adoption led to NPL increase of approximately $5.5 million as former PCI loans now reportable in nonperforming loans 4Q 2019 ALLL to 1Q 2020 ACL Bridge $89.1 $25.0 ( $2.1 ) $0.6 $3.6 $8.5 $22.4 $31.1 12/31/19 CECL Non-PCD Credit Mark PCD Credit Mark Farmers National Bank Net Charge-Offs Economic & Mix 3/31/2020 "Double Count" Reclassification of Scottsville Adjustment 1Source: Moody’s “March 2020 U.S. Macroeconomic Outlook Baseline and Alternative Scenarios Updated” published April 4, 2020. 18

 
Asset quality remains solid Nonperforming ratios Classified loans ($mm) 1 2 NPLs (HFI)/loans (HFI) NPAs/assets $79 $80 0.77% 0.74% $74 0.68% $69 0.62% 0.57% 0.59% 0.60% $61 0.47% 0.41% 0.43% 1Q19 2Q19 3Q19 4Q19 1Q20 1Q19 2Q19 3Q19 4Q19 1Q20 LLR/loans Net charge-offs/average loans 1.95% 0.30% 0.19% 0.79% 0.70% 0.72% 0.71% 0.06% 0.05% 0.05% 1Q19 2Q19 3Q19 4Q19 1Q20 1Q19 2Q19 3Q19 4Q19 1Q20 ¹ Adoption of CECL resulted in approximately $5.5 million of former PCI loans being reportable as nonperforming loans in 1Q 2020. 2 Includes acquired excess land and facilities held for sale–see page 14 of the Quarterly Financial Supplement. 19

 
Core earnings power remains intact Adjusted pre-tax, pre-provision return on average assets¹ 2.40% 2.25% 2.34% 2.15% 2.10% 1.81% 2015 2016 2017 2018 2019 1Q 2020 Drivers of profitability Loans/deposits Net interest margin Noninterest income ($mm) Core efficiency ratio1 Loans excluding HFS Loans HFS 101% 95% $145 $142 95% $135 88% 15% 91% $131 73.1% 81% 7% 6% 4.66% 6% 70.6% 11% 19% 4.46% 68.1% 4.34% $92 65.8% 65.4% 65.7% 4.10% 86% 88% 89% 85% 3.97% 70% 69% 3.92% $43 2015 2016 2017 2018 2019 1Q20 2015 2016 2017 2018 2019 1Q20 2015 2016 2017 2018 2019 1Q20 2015 2016 2017 2018 2019 1Q20 ¹ See “Use of non-GAAP financial measures” and the Appendix hereto for a discussion and reconciliation of non-GAAP measures 20

 
Managing net interest margin through falling rates Historical yield and costs Average interest earning assets Yield on loans Cost of deposits NIM 7.0% $7,000 6.0% $6,000 5.0% $5,000 4.0% $4,000 3.0% $3,000 2.0% $2,000 1.0% $1,000 ($mm) assets -- $0 Avg. earning interest Yields and Costs (%) and Costs Yields 1Q19 2Q19 3Q19 4Q19 1Q20 NIM 4.61% 4.39% 4.28% 4.12% 3.92% Impact of accretion and nonaccrual 17 17 16 21 13 interest (bps) Deposit Cost: Cost of MMDA 1.49% 1.48% 1.45% 1.29% 1.15% Cost of customer time 2.04% 2.13% 2.13% 2.07% 1.95% Cost of interest-bearing 1.47% 1.49% 1.47% 1.36% 1.25% Total deposit cost 1.14% 1.14% 1.11% 1.02% 0.94% Loans HFI Yield: Contractual interest 5.69% 5.57% 5.50% 5.27% 5.14% Origination and other 0.42% 0.29% 0.30% 0.26% 0.23% loan fee income Nonaccrual interest 0.01% 0.01% 0.02% 0.04% 0.02% Accretion on 0.20% 0.20% 0.19% 0.23% 0.14% purchased loans Syndication fee 0.02% 0.00% 0.00% 0.00% 0.00% income Total loan (HFI) yield 6.34% 6.07% 6.01% 5.80% 5.53% ¹ Includes tax-equivalent adjustment 21

 
Mortgage operations overview Highlights Quarterly mortgage production  Record total Mortgage pre-tax contribution of $8.0mm for 1Q Consumer Direct 2020 Retail 1Q19 4Q19 1Q20 Wholesale  Mortgage sale margins continue to be elevated due to industry capacity constraints and low interest rates  Mortgage banking income $32.7 mm, up 55.8% from 1Q 2019 and 25.1% from 4Q 2019  MSR hedging offset $14.9 million of the $16.1 million of MSR IRLC volume: $1,365mm $1,082mm $2,094mm valuation decrease in the quarter IRLC pipeline2: $493mm $453mm $1,085mm  2019 mortgage restructuring allows team to capitalize on Refinance %: 42% 67% 78% attractive rate environments while weathering downturns Purchase %: 58% 33% 22% Mortgage banking income ($mm) Mortgage sale margin 1Q19 4Q19 1Q20 2.88% 2.92% Gain on Sale $15.9 $31.8 $30.4 Fair value $2.2 ($4.3) $3.2 changes 2.29% Servicing $4.8 $4.9 $5.0 Revenue 1.65% 1.67% Fair value ($1.9) ($6.2) ($5.9) MSR changes Total $21.0 $26.2 $32.7 Income 1Q19 2Q19 3Q19 4Q19 1Q20 ¹ See “Use of non-GAAP financial measures” and the Appendix hereto for a discussion and reconciliation of non-GAAP financial measures ² As of the respective period-end 22

 
Managing operating leverage Highlights Core efficiency ratio (tax-equivalent basis)¹  Consolidated 1Q 2020 core efficiency ratio¹ Banking segment of 65.7% Consolidated Mortgage segment 93.3% 92.4% 85.0% 79.5%  Integration of FNB Financial Corp acquisition underway and in line with expectations; anticipate May 2020 conversion date 65.9% 66.5% 64.9% 64.5% 65.7% 61.1% 61.8% 58.5% 59.6% 54.7%  Record quarterly mortgage contribution in low rate environment  Expense control to be a focus for 2020 with margin headwinds NM 1Q19 2Q19 3Q19 4Q19 1Q20 ¹ See “Use of non-GAAP financial measures” and the Appendix hereto for a discussion and reconciliation of non-GAAP measures. 23

 
Appendix 24

 
GAAP reconciliation and use of non-GAAP financial measures Adjusted net income and diluted earnings per share 25

 
GAAP reconciliation and use of non-GAAP financial measures Pre-tax, pre-provision earnings and diluted earnings per share 26

 
GAAP reconciliation and use of non-GAAP financial measures Adjusted pro forma net income and diluted earnings per share* 27

 
GAAP reconciliation and use of non-GAAP financial measures Adjusted pre-tax, pre-provision earnings and diluted earnings per share 28

 
GAAP reconciliation and use of non-GAAP financial measures Core efficiency ratio (tax-equivalent basis) 29

 
GAAP reconciliation and use of non-GAAP financial measures Core efficiency ratio (tax-equivalent basis) 30

 
GAAP reconciliation and use of non-GAAP financial measures Segment core efficiency ratios (tax-equivalent basis) 31

 
GAAP reconciliation and use of non-GAAP financial measures Adjusted mortgage contribution 32

 
GAAP reconciliation and use of non-GAAP financial measures Tangible assets and equity 33

 
GAAP reconciliation and use of non-GAAP financial measures Return on average tangible common equity 34

 
GAAP reconciliation and use of non-GAAP financial measures Adjusted return on average tangible common equity Adjusted return on average assets and equity 35

 
GAAP reconciliation and use of non-GAAP financial measures Adjusted pre-tax, pre-provision return on average tangible common equity Adjusted pre-tax, pre-provision return on average assets and equity 36

 
GAAP reconciliation and use of non-GAAP financial measures Adjusted pro forma return on average assets and equity Adjusted pre-tax, pre-provision return on average assets and equity 37