_
0001475841false00014758412021-10-192021-10-19

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): October 19, 2021

NATIONAL BANK HOLDINGS CORPORATION
(Exact name of registrant as specified in its charter)

Delaware

001-35654

27-0563799

(State or other jurisdiction
of incorporation)

(Commission
File Number)

(IRS Employer
Identification No.)

7800 East Orchard Road, Suite 300, Greenwood Village, Colorado 80111
(Address of principal executive offices) (Zip Code)

303-892-8715
(Registrant’s telephone, including area code)

Not Applicable
(Former name or former address, if changed since last report.)

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

    

Name of each exchange on which registered:

Class A Common Stock

NBHC

NYSE

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 2.02. Results of Operations and Financial Conditions. *

On October 19, 2021, National Bank Holdings Corporation (“NBHC”) issued a press release announcing its financial results for the quarter ended September 30, 2021, which press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.

Item 7.01. Regulation FD Disclosure. *

On October 19, 2021, NBHC issued, distributed, made available to investors, and posted on its website, the press release and accompanying financial tables reflecting its financial results for the quarter ended September 30, 2021, also furnished as Exhibit 99.1 hereto and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits. *

(d) Exhibits

Exhibit No.

    

Description of Exhibit

99.1

Press release dated October 19, 2021

104

Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101)

*The information contained in Items 2.02, 7.01 and 9.01 of this Current Report on Form 8-K is being “furnished” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any registration statement or other filings of the Registrant under the Securities Act of 1933, as amended, except as shall be set forth by specific reference in such filing.

2

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.

National Bank Holdings Corporation

By:

/s/ Angela N. Petrucci

Name: Angela N. Petrucci

Title: Chief Administrative Officer and General Counsel

Date: October 19, 2021

3

Exhibit 99.1

Graphic

National Bank Holdings Corporation Announces

Third Quarter 2021 Financial Results

Denver, Colorado - (Globe Newswire) – National Bank Holdings Corporation (NYSE: NBHC) reported:

For the quarter

3Q21

2Q21

3Q20

Net income ($000's)

$

19,825

$

24,200

$

27,893

Earnings per share - diluted

$

0.64

$

0.77

$

0.90

Return on average tangible assets(1)

1.14%

1.41%

1.76%

Return on average tangible common equity(1)

10.65%

13.41%

16.49%

                                                      

(1)

Ratios are annualized. See non-GAAP reconciliations starting on page 14.

In announcing these results, Chief Executive Officer Tim Laney shared, “We are pleased with this quarter’s results, delivering quarterly earnings of $0.64 per diluted share and pre-provision net revenue growth of 16.2% annualized over the prior quarter. Excluding PPP loans, our teams delivered impressive annualized loan growth of 16.5% fueled by record quarterly loan originations. Our prudent approach to extending new credit continues to result in excellent credit quality with just two basis points of annualized net charge-offs for the quarter. We maintain ample liquidity and a strong Common Equity Tier 1 ratio of 14.57% which serves as a source of strength as we execute on our growth strategies.”

Mr. Laney added, “Earlier this quarter, we announced strategic investments in two fintech firms, Finstro Global Holdings Inc. and Figure Technologies. Finstro and Figure are our initial partners working with NBH to introduce a comprehensive digital financial ecosystem serving small and medium-sized businesses. We believe we are on the verge of creating a business that will provide small and medium-sized businesses with access to a full range of banking services and block chain payment alternatives.”

Third Quarter 2021 Results

(All comparisons refer to the second quarter of 2021, except as noted)

Net income totaled $19.8 million, or $0.64 per diluted share, during the third quarter of 2021, compared to $24.2 million, or $0.77 per diluted share during the second quarter. The return on average tangible assets was 1.14%, compared to 1.41%, and the return on average tangible common equity was 10.65%, compared to 13.41% last quarter.

Net Interest Income

Fully taxable equivalent net interest income totaled $48.9 million during the third quarter of 2021, an increase of $2.7 million. Excluding PPP loan fee income of $2.6 million, which was $0.5 million higher than last quarter, net interest income increased $2.2 million or 19.8% annualized. As of September 30, 2021, the remaining unamortized PPP loan fees totaled $2.4 million. The fully taxable equivalent net interest margin widened 11 basis points to 2.93% driven by excess cash liquidity being deployed into higher yielding originated loans. The yield on earning assets increased eight basis points, with the cost of deposits decreasing three basis points to 0.21%.

1


Loans

Total loans ended the quarter at $4.4 billion, an increase of $121.0 million over the prior quarter. Excluding PPP loans, total loans increased $173.9 million or 16.5% annualized, led by commercial loan growth of $138.2 million, or 19.2% annualized. Third quarter loan originations totaled a record $413.3 million, led by commercial loan originations of $301.7 million.

Asset Quality and Provision for Loan Losses

Net loan loss provision recorded during the quarter was zero compared to a release of $5.9 million in the prior quarter. The quarter’s loan growth was offset by strong asset quality and an improved outlook in the CECL model’s underlying economic forecast. Annualized net charge-offs totaled 0.02% of total loans, compared to 0.07%. Non-performing loans (comprised of non-accrual loans and non-accrual TDRs) improved three basis points to 0.29% of total loans, and non-performing assets improved five basis points to 0.39% of total loans and OREO. The allowance for credit losses as a percentage of total loans totaled 1.11%, compared to 1.14% at June 30, 2021.

Deposits

Average total deposits increased $33.9 million or 2.2% annualized, to $6.1 billion for the third quarter 2021. Average transaction deposits (defined as total deposits less time deposits) increased $67.6 million or 5.2% annualized. The mix of transaction deposits to total deposits improved 72 basis points to 85.7% at September 30, 2021. The loan to deposit ratio totaled 72.1% at September 30, 2021, compared to 69.8% at June 30, 2021.

Non-Interest Income

Non-interest income totaled $28.5 million, an increase of $3.3 million largely driven by higher mortgage banking income, which included a $1.3 million gain from the sale of mortgage servicing rights. Service charges and bank card fees increased a combined $0.3 million during the quarter. Included in other non-interest income was $0.8 million of deposit premium gain from the sale of one banking center during the third quarter. Additionally, other non-interest income included $0.4 million and $0.8 million of gains from fixed assets sales from banking center consolidations during the third and second quarters, respectively.

Non-Interest Expense

Non-interest expense totaled $51.3 million, an increase of $5.0 million, primarily due to transaction-related costs and higher performance-related compensation. Included in the quarter were $2.4 million of transaction-related expenses for the previously announced strategic investments in Finstro Global Holdings Inc. and Figure Technologies to further our vision for building a comprehensive digital financial ecosystem. Salaries and benefits increased $1.1 million largely due to higher performance-related compensation. Problem asset workout expense increased $0.8 million due to the write-down of one previously acquired OREO property. The fully taxable equivalent efficiency ratio totaled 65.9% at September 30, 2021, compared to 64.5% at June 30, 2021.

Income tax expense totaled $5.0 million during the third quarter, compared to $5.4 million. The effective tax rate for the third quarter 2021 was 20.0%, compared to 18.4% during the prior quarter, driven by an increase in the full year projected income. The lower rate compared to the statutory rate reflects the continued success of our tax strategies and tax-exempt income.

Capital

Capital ratios continue to be strong and in excess of federal bank regulatory agency “well capitalized” thresholds. The Tier 1 leverage ratios at September 30, 2021 for the consolidated company and NBH Bank were 10.43% and 8.91%, respectively. Shareholders’ equity totaled $844.7 million at September 30, 2021, decreasing $7.2 million primarily due to stock repurchase activity during the quarter.

Common book value per share increased $0.23 to $27.89 at September 30, 2021. The quarter’s earnings, net of dividends paid and share repurchases, increased the tangible common book value per share by $0.19 to $24.20 at September 30, 2021. Excluding accumulated other comprehensive income, the tangible book value per share increased $0.29 to $24.24 at September 30, 2021.

Recent Events

The COVID-19 pandemic has caused disruption and is likely to continue to present challenges to our business. We continue to remain committed to ensuring our associates, clients and communities are receiving the support they need through our banking centers and our

2


digital banking platform. Our teams have been working diligently to support our clients who are experiencing financial hardship due to COVID-19 through participation in the SBA’s Paycheck Protection Program, including assistance with PPP loan forgiveness applications, and loan modifications, as needed. While access to vaccines in the United States has increased, the efficacy of those vaccines, the impact of emerging targeted vaccine mandates and new variants of the virus, and the length of time that the government-mandated measures must remain in place or potentially be reinstituted to address COVID-19 are unknown. The pandemic has had a negative impact to the U.S. labor market, consumer spending and business operations, and it is not clear whether new outbreaks of COVID-19 cases will have further impact.

Year-Over-Year Review

(All comparisons refer to the first nine months of 2020, except as noted)

Net income totaled $70.8 million, or $2.27 per diluted share, an increase of $9.4 million or 15.3% over the first nine months of 2020. The return on average tangible assets increased three basis points to 1.39%, and the return on average tangible common equity increased 57 basis points to 13.04%.

Fully taxable equivalent net interest income totaled $141.5 million, decreasing $6.7 million or 4.5%, as a result of interest rate actions taken by the Federal Reserve during 2020 and lower non-PPP loan balances. Average earning assets increased $785.1 million, or 13.8%, primarily driven by increases in average interest bearing cash balances of $671.0 million and average investment securities of $411.5 million. The fully taxable equivalent net interest margin narrowed 56 basis points to 2.92% due to lower earning asset yields. The yield on earning assets decreased 82 basis points, driven by the remix of assets into lower-yielding cash balances. The cost of deposits decreased 25 basis points to 0.24%.

Loans outstanding totaled $4.4 billion, decreasing $134.4 million or 2.9%, due to loan payoffs including lower PPP loan balances of $271.5 million as a result of PPP loan forgiveness, which were partially offset by non-PPP loan growth. New loan originations over the trailing 12 months totaled $1.3 billion, led by commercial loan originations of $895.8 million including PPP loan originations of $121.1 million.

The Company recorded $9.4 million of net provision release during the first nine months of 2021, compared to $17.6 million of provision expense during the same period in 2020. The provision release was driven by strong asset quality and an improved outlook in the CECL model’s underlying economic forecast. Annualized net charge-offs totaled 0.03% of total loans, compared to 0.04% of total loans during the first nine months of 2020. Non-performing loans to total loans improved 12 basis points to 0.29%, compared to 0.41% at September 30, 2020. The allowance for credit losses totaled 1.11% of total loans, compared to 1.34% at September 30, 2020.

Average total deposits increased $865.7 million or 16.9%, to $6.0 billion for the first nine months of 2021. Average non-interest bearing demand deposits increased $956.6 million or 70.2%, and average transaction deposits increased $977.7 million, or 23.9%. The mix of transaction deposits to total deposits increased by 400 basis points to 85.7% at September 30, 2021. The mix of non-interest bearing demand deposits to total deposits improved to 39.9% from 27.3% at September 30, 2020.

Non-interest income totaled $87.1 million, representing a decrease of $19.8 million or 18.5%, driven by $26.3 million lower mortgage banking income due to slower refinance activity in 2021 and competition driving tighter gain on sale margins. Service charges and bank card fees increased a combined $2.0 million. Other non-interest income increased $4.6 million due to $3.5 million of gains from banking center-related sales activities during the first nine months of 2021.

Non-interest expense totaled $147.3 million, a decrease of $10.4 million or 6.6% driven by lower mortgage-related compensation as well as the Company’s strategic efforts to improve operating efficiency. Included in the nine months of 2021 were $2.5 million of transaction-related expenses for the previously announced investments in our digital financial ecosystem. Salaries and benefits decreased $10.7 million primarily due to lower mortgage banking related compensation. Occupancy and equipment decreased $1.7 million largely due to efficiencies gained from the completion of the previously announced banking center consolidations. Problem asset workout expense decreased $0.5 million.

3


Income tax expense totaled $16.1 million, an increase of $1.6 million, driven by 2021’s higher pre-tax income. Included in income tax expense was $0.4 million of tax benefit and $0.1 million of tax expense from stock compensation activity during the first nine months of 2021 and 2020, respectively. Adjusting for stock compensation activity, the effective tax rate for the first nine months of 2021 was 18.9%, consistent with 2020.

Conference Call

Management will host a conference call to review the results at 11:00 a.m. Eastern Time on Wednesday, October 20, 2021. Interested parties may listen to this call by dialing (800) 367-2403 (United States) / 0800 031 4838 (United Kingdom) using the confirmation code of 7577774 and asking for the NBHC Q3 2021 Earnings Call. A telephonic replay of the call will be available beginning approximately four hours after the call’s completion through October 25, 2021, by dialing (888) 203-1112 using the confirmation code of 7577774. The earnings release and an on-line replay of the call will also be available on the Company’s website at www.nationalbankholdings.com by visiting the investor relations area.

About Non-GAAP Financial Measures

Certain of the financial measures and ratios we present, including “tangible assets,” “return on average tangible assets,” “tangible common equity,” “return on average tangible common equity,” “tangible common book value per share,” “tangible common book value, excluding accumulated other comprehensive loss, net of tax,” “tangible common book value per share, excluding accumulated other comprehensive loss, net of tax,” “tangible common equity to tangible assets,” and “fully taxable equivalent” metrics, are supplemental measures that are not required by, or are not presented in accordance with, U.S. generally accepted accounting principles (GAAP). We refer to these financial measures and ratios as “non-GAAP financial measures.” We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision making and useful in evaluating period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenditures or assets that we believe are not indicative of our primary business operating results or by presenting certain metrics on a fully taxable equivalent basis. We believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing and comparing past, present and future periods.

These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and you should not rely on non-GAAP financial measures alone as measures of our performance. The non-GAAP financial measures we present may differ from non-GAAP financial measures used by our peers or other companies. We compensate for these limitations by providing the equivalent GAAP measures whenever we present the non-GAAP financial measures and by including a reconciliation of the impact of the components adjusted for in the non-GAAP financial measure so that both measures and the individual components may be considered when analyzing our performance.

A reconciliation of non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables.

About National Bank Holdings Corporation

National Bank Holdings Corporation is a bank holding company created to build a leading community bank franchise delivering high quality client service and committed to stakeholder results. Through its bank subsidiary, NBH Bank, National Bank Holdings Corporation operates a network of 81 banking centers, serving individual consumers, small, medium and large businesses, and government and non-profit entities. Its banking centers are located in its core footprint of Colorado, the greater Kansas City region, Texas, Utah and New Mexico. Its comprehensive residential mortgage banking group primarily serves the bank’s core footprint. NBH Bank operates under the following brand names: Community Banks of Colorado and Community Banks Mortgage, a division of NBH Bank, in Colorado, Bank Midwest and Bank Midwest Mortgage in Kansas and Missouri, and Hillcrest Bank and Hillcrest Bank Mortgage in Texas, Utah and New Mexico. Additional information about National Bank Holdings Corporation can be found at www.nationalbankholdings.com.

4


For more information visit: cobnks.com, bankmw.com, hillcrestbank.com or nbhbank.com. Or, follow us on any of our social media sites:

Community Banks of Colorado: facebook.com/cobnks, twitter.com/cobnks, instagram.com/cobnks;

Bank Midwest: facebook.com/bankmw, twitter.com/bank_mw, instagram.com/bankmw;

Hillcrest Bank: facebook.com/hillcrestbank, twitter.com/hillcrest_bank;

NBH Bank: twitter.com/nbhbank;

or connect with any of our brands on LinkedIn.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements contain words such as “anticipate,” “believe,” “can,” “would,” “should,” “could,” “may,” “predict,” “seek,” “potential,” “will,” “estimate,” “target,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “intend” or similar expressions that relate to the Company’s strategy, plans or intentions. Forward-looking statements involve certain important risks, uncertainties and other factors, any of which could cause actual results to differ materially from those in such statements. Such factors include, without limitation, the “Risk Factors” referenced in our most recent Form 10-K filed with the Securities and Exchange Commission (SEC), other risks and uncertainties listed from time to time in our reports and documents filed with the SEC, and the following factors: ability to execute our business strategy; business and economic conditions; effects of any potential government shutdowns; economic, market, operational, liquidity, credit and interest rate risks associated with the Company’s business; effects of any changes in trade, monetary and fiscal policies and laws; changes imposed by regulatory agencies to increase capital standards; effects of inflation, as well as, interest rate, securities market and monetary supply fluctuations; changes in the economy or supply-demand imbalances affecting local real estate values; changes in consumer spending, borrowings and savings habits; with respect to our mortgage business, the inability to negotiate fees with investors for the purchase or our loans or our obligation to indemnify purchasers or repurchase related loans; the Company’s ability to identify potential candidates for, consummate, integrate and realize operating efficiencies from, acquisitions, consolidations and other expansion opportunities; the Company's ability to realize anticipated benefits from enhancements or updates to its core operating systems from time to time without significant change in client service or risk to the Company's control environment; the Company's dependence on information technology and telecommunications systems of third party service providers and the risk of systems failures, interruptions or breaches of security; the Company’s ability to achieve organic loan and deposit growth and the composition of such growth; changes in sources and uses of funds; increased competition in the financial services industry; the effect of changes in accounting policies and practices; the share price of the Company’s stock; the Company's ability to realize deferred tax assets or the need for a valuation allowance; continued consolidation in the financial services industry; ability to maintain or increase market share and control expenses; costs and effects of changes in laws and regulations and of other legal and regulatory developments; technological changes; the timely development and acceptance of new products and services; the Company’s continued ability to attract, hire and maintain qualified personnel; ability to implement and/or improve operational management and other internal risk controls and processes and reporting system and procedures; regulatory limitations on dividends from the Company's bank subsidiary; changes in estimates of future credit reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; widespread natural and other disasters, pandemics, dislocations, political instability, acts of war or terrorist activities, cyberattacks or international hostilities; adverse effects due to the novel Coronavirus Disease 2019 (COVID-19) on the Company and its clients, counterparties, employees, and third-party service providers, and the adverse impacts on our business, financial position, results of operations, and prospects; impact of reputational risk; and success at managing the risks involved in the foregoing items. The Company can give no assurance that any goal or plan or expectation set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements. The forward-looking statements are made as of the date of this press release, and the Company does not intend, and assumes no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law.

5


Contact:

Analysts/Institutional Investors: Aldis Birkans, Chief Financial Officer, (720) 554-6640, [email protected]

Media: Jody Soper, Chief Marketing Officer, (303) 784-5925, [email protected]

6


NATIONAL BANK HOLDINGS CORPORATION

FINANCIAL SUMMARY

Consolidated Statements of Operations (Unaudited)

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

For the three months ended

For the nine months ended

September 30, 

    

June 30, 

    

September 30, 

    

September 30, 

    

September 30, 

2021

2021

2020

2021

2020

Total interest and dividend income

$

50,801

$

48,450

$

52,302

$

148,464

$

164,714

Total interest expense

 

3,232

 

3,582

 

5,587

 

10,806

 

20,324

Net interest income

 

47,569

 

44,868

 

46,715

 

137,658

 

144,390

Taxable equivalent adjustment

1,315

1,279

1,275

3,862

3,843

Net interest income FTE(1)

48,884

46,147

47,990

141,520

148,233

Provision (release) expense for loan losses

 

 

(5,850)

 

1,200

 

(9,425)

 

17,630

Net interest income after provision for loan losses FTE(1)

 

48,884

 

51,997

 

46,790

 

150,945

 

130,603

Non-interest income:

Service charges

 

3,947

 

3,568

 

3,742

 

10,989

 

10,962

Bank card fees

 

4,530

 

4,614

 

4,039

 

13,217

 

11,206

Mortgage banking income

 

16,615

 

13,979

 

34,943

 

52,973

 

79,246

Other non-interest income

 

3,430

 

3,105

 

1,733

 

9,935

 

5,384

OREO-related income

 

 

 

75

 

35

 

103

Total non-interest income

 

28,522

 

25,266

 

44,532

 

87,149

 

106,901

Non-interest expense:

Salaries and benefits

 

32,556

 

31,439

 

38,614

 

97,518

 

108,251

Occupancy and equipment

6,469

6,131

6,878

19,150

20,854

Professional fees

 

3,251

 

649

 

714

 

4,642

 

2,082

Other non-interest expense

 

7,624

 

7,019

 

7,443

 

21,496

 

21,222

Problem asset workout

 

1,119

 

294

 

1,064

 

1,851

 

2,341

Loss (gain) on sale of OREO, net

 

 

221

 

(119)

 

192

 

(25)

Core deposit intangible asset amortization

295

296

295

887

887

Banking center consolidation-related expense

294

432

1,589

2,140

Total non-interest expense

51,314

 

46,343

 

55,321

 

147,325

 

157,752

Income before income taxes FTE(1)

 

26,092

 

30,920

 

36,001

 

90,769

 

79,752

Taxable equivalent adjustment

1,315

1,279

1,275

3,862

3,843

Income before income taxes

24,777

29,641

34,726

86,907

75,909

Income tax expense

 

4,952

 

5,441

 

6,833

 

16,070

 

14,487

Net income

$

19,825

$

24,200

$

27,893

$

70,837

$

61,422

Earnings per share - basic

$

0.64

$

0.78

$

0.91

$

2.29

$

1.99

Earnings per share - diluted

0.64

0.77

0.90

2.27

1.97

                                                      

(1)

    

Net interest income is presented on a GAAP basis and fully taxable equivalent (FTE) basis, as the Company believes this non-GAAP measure is the preferred industry measurement for this item. The FTE adjustment is for the tax benefit on certain tax exempt loans using the federal tax rate of 21% for each period presented.

7


NATIONAL BANK HOLDINGS CORPORATION

Consolidated Statements of Financial Condition (Unaudited)

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

September 30, 2021

June 30, 2021

    

December 31, 2020

September 30, 2020

ASSETS

Cash and cash equivalents

$

807,370

$

1,004,493

$

605,565

$

445,103

Investment securities available-for-sale

 

657,833

 

605,798

 

661,955

 

572,523

Investment securities held-to-maturity

 

642,636

 

687,635

 

376,615

 

320,001

Non-marketable securities

 

46,964

 

24,637

 

22,073

 

33,614

Loans

 

4,421,760

 

4,300,757

 

4,353,726

 

4,556,121

Allowance for credit losses

 

(49,155)

 

(49,030)

 

(59,777)

 

(60,979)

Loans, net

 

4,372,605

 

4,251,727

 

4,293,949

 

4,495,142

Loans held for sale

 

158,066

 

134,805

 

247,813

 

273,003

Other real estate owned

 

4,325

 

5,124

 

4,730

 

4,590

Premises and equipment, net

 

94,114

 

95,019

 

106,982

 

108,860

Goodwill

 

115,027

 

115,027

 

115,027

 

115,027

Intangible assets, net

 

11,621

 

22,360

 

17,928

 

15,017

Other assets

 

190,430

 

189,503

 

207,313

 

217,796

Total assets

$

7,100,991

$

7,136,128

$

6,659,950

$

6,600,676

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:

Non-interest bearing demand deposits

$

2,447,099

$

2,437,328

$

2,111,045

$

1,533,676

Interest bearing demand deposits

 

546,597

 

555,865

 

514,286

 

976,133

Savings and money market

 

2,264,083

 

2,240,359

 

2,064,769

 

2,079,585

Total transaction deposits

 

5,257,779

 

5,233,552

 

4,690,100

 

4,589,394

Time deposits

 

876,841

 

924,501

 

986,132

 

1,027,066

Total deposits

 

6,134,620

 

6,158,053

 

5,676,232

 

5,616,460

Securities sold under agreements to repurchase

 

21,427

 

22,957

 

22,897

 

23,904

Other liabilities

 

100,228

 

103,252

 

140,130

 

160,955

Total liabilities

 

6,256,275

 

6,284,262

 

5,839,259

 

5,801,319

Shareholders' equity:

Common stock

 

515

 

515

 

515

 

515

Additional paid in capital

 

1,013,064

 

1,011,200

 

1,011,362

 

1,010,145

Retained earnings

 

273,900

 

260,821

 

223,175

 

202,238

Treasury stock

 

(441,366)

 

(422,365)

 

(424,127)

 

(424,621)

Accumulated other comprehensive (loss) income, net of tax

 

(1,397)

 

1,695

 

9,766

 

11,080

Total shareholders' equity

 

844,716

 

851,866

 

820,691

 

799,357

Total liabilities and shareholders' equity

$

7,100,991

$

7,136,128

$

6,659,950

$

6,600,676

SHARE DATA

Average basic shares outstanding

 

30,800,590

 

30,947,206

 

30,784,896

 

30,756,116

Average diluted shares outstanding

 

31,064,815

 

31,226,351

 

31,032,648

 

30,924,223

Ending shares outstanding

 

30,288,131

 

30,800,985

 

30,634,291

 

30,594,412

Common book value per share

$

27.89

$

27.66

$

26.79

$

26.13

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

24.20

24.01

23.09

22.40

Tangible common book value per share, excluding accumulated other comprehensive income(1) (non-GAAP)

24.24

23.95

22.77

22.04

CAPITAL RATIOS

Average equity to average assets

12.07%

11.95%

12.27%

12.22%

Tangible common equity to tangible assets(1)

10.49%

10.53%

10.80%

10.57%

Tier 1 leverage ratio

10.43%

10.57%

10.70%

10.60%

Common equity tier 1 risk-based capital ratio

14.57%

15.31%

14.70%

14.25%

Tier 1 risk-based capital ratio

14.57%

15.31%

14.70%

15.40%

Total risk-based capital ratio

15.48%

16.27%

15.83%

15.40%

                                                      

(1)

    

Represents a non-GAAP financial measure. See non-GAAP reconciliations starting on page 14.

8


NATIONAL BANK HOLDINGS CORPORATION

Loan Portfolio

(Dollars in thousands)

Period End Loan Balances by Type

September 30, 2021

September 30, 2021

vs. June 30, 2021

vs. September 30, 2020

September 30, 2021

June 30, 2021

% Change

September 30, 2020

% Change

Originated:

Commercial:

Commercial and industrial

$

1,352,481

$

1,253,745

7.9%

$

1,228,550

10.1%

Municipal and non-profit

878,988

860,740

2.1%

883,065

(0.5)%

Owner-occupied commercial real estate

504,415

479,286

5.2%

460,487

9.5%

Food and agribusiness

195,766

195,095

0.3%

210,818

(7.1)%

PPP loans(1)

76,794

129,643

(40.8)%

348,257

(77.9)%

Total commercial

3,008,444

2,918,509

3.1%

3,131,177

(3.9)%

Commercial real estate non-owner occupied

605,143

570,252

6.1%

515,415

17.4%

Residential real estate

608,158

600,124

1.3%

614,449

(1.0)%

Consumer

17,735

17,942

(1.2)%

20,196

(12.2)%

Total originated

4,239,480

4,106,827

3.2%

4,281,237

(1.0)%

Acquired:

Commercial:

Commercial and industrial

17,521

18,710

(6.4)%

23,984

(26.9)%

Municipal and non-profit

347

359

(3.3)%

576

(39.8)%

Owner-occupied commercial real estate

37,335

40,435

(7.7)%

55,929

(33.2)%

Food and agribusiness

3,653

3,913

(6.6)%

5,740

(36.4)%

Total commercial

58,856

63,417

(7.2)%

86,229

(31.7)%

Commercial real estate non-owner occupied

65,784

67,368

(2.4)%

101,672

(35.3)%

Residential real estate

57,344

62,805

(8.7)%

86,478

(33.7)%

Consumer

296

340

(12.9)%

505

(41.4)%

Total acquired

182,280

193,930

(6.0)%

274,884

(33.7)%

Total loans

$

4,421,760

$

4,300,757

2.8%

$

4,556,121

(2.9)%

                                                      

(1)

    

PPP loan balances are net of fees and costs and include principal totaling $79,242, $134,632 and $356,913 as of September 30, 2021, June 30, 2021 and September 30, 2020, respectively.

Originations(1)

Third quarter

Second quarter

First quarter

Fourth quarter

Third quarter

2021

2021

2021

2020

2020

Commercial:

Commercial and industrial

$

196,289

$

147,030

$

23,390

$

96,625

$

11,354

Municipal and non-profit

43,516

25,131

7,999

25,348

6,083

Owner occupied commercial real estate

 

53,445

 

48,225

 

27,093

 

36,085

 

23,758

Food and agribusiness

 

8,442

 

26,956

 

(10,104)

 

19,191

 

13,876

PPP loans

 

 

121,141

 

 

122

Total commercial

301,692

247,342

169,519

177,249

55,193

Commercial real estate non-owner occupied

 

55,392

 

58,532

 

49,195

 

52,018

 

24,937

Residential real estate

 

54,442

 

53,962

 

74,145

 

41,355

 

49,786

Consumer

 

1,810

 

2,267

 

1,353

 

1,858

 

2,980

Total

$

413,336

$

362,103

$

294,212

$

272,480

$

132,896

                                                      

(1)

    

Originations are defined as closed end funded loans and net fundings under revolving lines of credit. Net fundings (paydowns) under revolving lines of credit were $29,154, $59,520, ($26,395), $50,982 and ($27,899) as of the third, second and first quarters of 2021 and the fourth and third quarters of 2020, respectively.

9


NATIONAL BANK HOLDINGS CORPORATION

Summary of Net Interest Margin

(Dollars in thousands)

For the three months ended

For the three months ended

For the three months ended

September 30, 2021

June 30, 2021

September 30, 2020

Average

    

    

Average

    

Average

    

    

Average

    

Average

    

    

Average

balance

Interest

rate

balance

Interest

rate

balance

Interest

rate

Interest earning assets:

Originated loans FTE(1)(2)

$

4,137,001

$

41,865

4.01%

$

4,077,142

$

40,036

3.94%

$

4,343,335

$

40,973

3.75%

Acquired loans

 

187,419

 

3,796

8.04%

 

211,126

 

3,923

7.45%

 

284,653

6,593

9.21%

Loans held for sale

157,381

1,166

2.94%

159,068

1,213

3.06%

230,390

1,683

2.91%

Investment securities available-for-sale

 

656,757

 

2,572

1.57%

 

638,039

 

2,397

1.50%

 

559,330

2,784

1.99%

Investment securities held-to-maturity

 

671,053

 

2,178

1.30%

 

572,534

 

1,723

1.20%

 

242,511

1,253

2.07%

Other securities

 

14,657

 

210

5.73%

 

15,079

 

209

5.54%

 

29,640

221

2.98%

Interest earning deposits and securities purchased under agreements to resell

 

799,779

 

329

0.16%

 

888,600

 

228

0.10%

 

254,931

70

0.11%

Total interest earning assets FTE(2)

$

6,624,047

$

52,116

3.12%

$

6,561,588

$

49,729

3.04%

$

5,944,790

$

53,577

3.59%

Cash and due from banks

$

77,498

$

78,148

$

73,274

Other assets

 

463,553

 

472,142

 

525,324

Allowance for credit losses

 

(48,957)

 

(54,984)

 

(60,372)

Total assets

$

7,116,141

$

7,056,894

$

6,483,016

Interest bearing liabilities:

Interest bearing demand, savings and money market deposits

$

2,803,071

$

1,516

0.21%

$

2,789,681

$

1,572

0.23%

$

2,957,604

$

1,990

0.27%

Time deposits

 

903,935

 

1,711

0.75%

 

937,579

 

2,004

0.86%

 

1,038,983

3,501

1.34%

Securities sold under agreements to repurchase

 

19,681

 

5

0.10%

 

19,891

 

6

0.12%

 

22,667

10

0.18%

Federal Home Loan Bank advances

 

 

0.00%

 

 

0.00%

 

1,141

86

29.99%

Total interest bearing liabilities

$

3,726,687

$

3,232

0.34%

$

3,747,151

$

3,582

0.38%

$

4,020,395

$

5,587

0.55%

Demand deposits

$

2,422,976

$

2,368,810

$

1,515,058

Other liabilities

 

107,233

 

97,817

 

155,205

Total liabilities

 

6,256,896

 

6,213,778

 

5,690,658

Shareholders' equity

 

859,245

 

843,116

 

792,358

Total liabilities and shareholders' equity

$

7,116,141

$

7,056,894

$

6,483,016

Net interest income FTE(2)

$

48,884

$

46,147

$

47,990

Interest rate spread FTE(2)

2.78%

2.66%

3.04%

Net interest earning assets

$

2,897,360

$

2,814,437

$

1,924,395

Net interest margin FTE(2)

2.93%

2.82%

3.21%

Average transaction deposits

$

5,226,047

$

5,158,491

$

4,472,662

Average total deposits

6,129,982

6,096,070

5,511,645

Ratio of average interest earning assets to average interest bearing liabilities

177.75%

175.11%

147.87%

                                                      

(1)

    

Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan.

(2)

    

Presented on a fully taxable equivalent basis using the statutory tax rate of 21%. The tax equivalent adjustments included above are $1,315, $1,279 and $1,275 for the three months ended September 30, 2021, June 30, 2021 and September 30, 2020, respectively.

10


NATIONAL BANK HOLDINGS CORPORATION

Summary of Net Interest Margin

(Dollars in thousands)

For the nine months ended September 30, 2021

For the nine months ended September 30, 2020

Average

  

    

  

Average

Average

  

    

  

Average

balance

Interest

rate

balance

Interest

rate

Interest earning assets:

Originated loans FTE(1)(2)

$

4,073,529

$

121,461

3.99%

$

4,273,332

$

128,392

4.01%

Acquired loans

 

212,151

 

12,847

8.10%

 

313,555

 

22,194

9.45%

Loans held for sale

182,385

3,896

2.86%

163,980

3,929

3.20%

Investment securities available-for-sale

 

660,399

 

7,454

1.50%

 

597,654

 

9,229

2.06%

Investment securities held-to-maturity

 

555,818

 

5,317

1.28%

 

207,107

 

3,689

2.37%

Other securities

 

15,180

 

629

5.52%

 

29,826

 

945

4.22%

Interest earning deposits and securities purchased under agreements to resell

 

776,472

 

722

0.12%

 

105,430

 

179

0.23%

Total interest earning assets FTE(2)

$

6,475,934

$

152,326

3.14%

$

5,690,884

$

168,557

3.96%

Cash and due from banks

$

78,953

$

74,694

Other assets

 

476,856

 

510,941

Allowance for credit losses

 

(54,249)

 

(54,077)

Total assets

$

6,977,494

$

6,222,442

Interest bearing liabilities:

Interest bearing demand, savings and money market deposits

$

2,746,657

$

4,740

0.23%

$

2,725,572

$

6,829

0.33%

Time deposits

 

936,088

 

6,050

0.86%

 

1,048,116

12,075

1.54%

Securities sold under agreements to repurchase

 

20,310

 

16

0.11%

 

30,322

125

0.55%

Federal Home Loan Bank advances

 

 

0.00%

 

127,456

1,295

1.36%

Total interest bearing liabilities

$

3,703,055

$

10,806

0.39%

$

3,931,466

$

20,324

0.69%

Demand deposits

$

2,320,160

$

1,363,556

Other liabilities

 

108,503

 

147,929

Total liabilities

 

6,131,718

 

5,442,951

Shareholders' equity

 

845,776

 

779,491

Total liabilities and shareholders' equity

$

6,977,494

$

6,222,442

Net interest income FTE(2)

$

141,520

$

148,233

Interest rate spread FTE(2)

2.75%

3.27%

Net interest earning assets

$

2,772,879

$

1,759,418

Net interest margin FTE(2)

2.92%

3.48%

Average transaction deposits

$

5,066,817

$

4,089,128

Average total deposits

6,002,905

5,137,244

Ratio of average interest earning assets to average interest bearing liabilities

174.88%

144.75%

                                                      

(1)

    

Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan.

(2)

    

Presented on a fully taxable equivalent basis using the statutory tax rate of 21%. The tax equivalent adjustments included above are $3,862 and $3,843 for the nine months ended September 30, 2021 and September 30, 2020, respectively.

11


NATIONAL BANK HOLDINGS CORPORATION

Allowance for Credit Losses and Asset Quality

(Dollars in thousands)

Allowance for Credit Losses Analysis

As of and for the three months ended

September 30, 2021

June 30, 2021

September 30, 2020

Beginning allowance for credit losses

$

49,030

$

55,057

$

60,465

Charge-offs

 

(322)

 

(925)

(619)

Recoveries

101

198

133

Provision expense (release)

 

346

 

(5,300)

 

1,000

Ending allowance for credit losses ("ACL")

$

49,155

$

49,030

$

60,979

Ratio of annualized net charge-offs to average total loans during the period

0.02%

0.07%

0.04%

Ratio of annualized net charge-offs to average total loans excluding PPP loans during the period

0.02%

0.07%

0.04%

Ratio of ACL to total loans outstanding at period end

1.11%

1.14%

1.34%

Ratio of ACL to total loans outstanding excluding PPP loans at period end

1.13%

1.18%

1.45%

Ratio of ACL to total non-performing loans at period end

382.59%

353.22%

322.95%

Total loans

$

4,421,760

$

4,300,757

$

4,556,121

Average total loans during the period

4,352,557

4,312,128

4,677,630

Average total loans excluding PPP loans during the period

4,245,524

4,112,172

4,329,458

Total non-performing loans

12,848

13,881

18,882

Past Due and Non-accrual Loans

September 30, 2021

June 30, 2021

September 30, 2020

Loans 30-89 days past due and still accruing interest

$

1,302

$

2,098

$

6,587

Loans 90 days past due and still accruing interest

 

495

 

767

 

161

Non-accrual loans

 

12,848

 

13,881

 

18,882

Total past due and non-accrual loans

$

14,645

$

16,746

$

25,630

Total 90 days past due and still accruing interest and non-accrual loans to total loans

0.30%

0.34%

0.42%

Asset Quality Data

September 30, 2021

June 30, 2021

September 30, 2020

Non-performing loans

$

12,848

$

13,881

$

18,882

OREO

 

4,325

 

5,124

 

4,590

Total non-performing assets

$

17,173

$

19,005

$

23,472

Accruing restructured loans

$

11,135

$

11,844

$

21,786

Total non-performing loans to total loans

0.29%

0.32%

0.41%

Total non-performing loans to total loans excluding PPP loans

0.30%

0.33%

0.45%

Total non-performing assets to total loans and OREO

0.39%

0.44%

0.51%

Total non-performing assets to total loans and OREO excluding PPP loans

0.39%

0.46%

0.56%

12


NATIONAL BANK HOLDINGS CORPORATION

Key Ratios(1)

As of and for the three months ended

As of and for the nine months ended

September 30, 

    

June 30, 

    

September 30, 

    

September 30, 

September 30, 

2021

    

2021

    

2020

    

2021

2020

Return on average assets

1.11%

1.38%

1.71%

1.36%

1.32%

Return on average tangible assets(2)

1.14%

1.41%

1.76%

1.39%

1.36%

Return on average equity

9.15%

11.51%

14.00%

11.20%

10.53%

Return on average tangible common equity(2)

10.65%

13.41%

16.49%

13.04%

12.47%

Loan to deposit ratio (end of period)

72.08%

69.84%

81.12%

72.08%

81.12%

Non-interest bearing deposits to total deposits (end of period)

39.89%

39.58%

27.31%

39.89%

27.31%

Net interest margin(4)

2.85%

2.74%

3.13%

2.84%

3.39%

Net interest margin FTE(2)(4)

2.93%

2.82%

3.21%

2.92%

3.48%

Interest rate spread FTE(2)(5)

2.78%

2.66%

3.04%

2.75%

3.27%

Yield on earning assets(3)

3.04%

2.96%

3.50%

3.07%

3.87%

Yield on earning assets FTE(2)(3)

3.12%

3.04%

3.59%

3.14%

3.96%

Cost of interest bearing liabilities(3)

0.34%

0.38%

0.55%

0.39%

0.69%

Cost of deposits

0.21%

0.24%

0.40%

0.24%

0.49%

Non-interest income to total revenue FTE(2)

36.85%

35.38%

48.13%

38.11%

41.90%

Non-interest expense to average assets

2.86%

2.63%

3.39%

2.82%

3.39%

Efficiency ratio

67.05%

65.66%

60.30%

65.14%

62.42%

Efficiency ratio FTE(2)

65.91%

64.48%

59.47%

64.04%

61.48%

Total Loans Asset Quality Data(6)(7)(8)

Non-performing loans to total loans

0.29%

0.32%

0.41%

0.29%

0.41%

Non-performing loans to total loans excluding PPP loans

0.30%

0.33%

0.45%

0.30%

0.45%

Non-performing assets to total loans and OREO

0.39%

0.44%

0.51%

0.39%

0.51%

Non-performing assets to total loans and OREO excluding PPP loans

0.39%

0.46%

0.56%

0.39%

0.56%

Allowance for credit losses to total loans

1.11%

1.14%

1.34%

1.11%

1.34%

Allowance for credit losses to total loans excluding PPP loans

1.13%

1.18%

1.45%

1.13%

1.45%

Allowance for credit losses to non-performing loans

382.59%

353.22%

322.95%

382.59%

322.95%

Net charge-offs to average loans(1)

0.02%

0.07%

0.04%

0.03%

0.04%

                                                      

(1)

    

Ratios are annualized.

(2)

    

Ratio represents non-GAAP financial measure. See non-GAAP reconciliations starting on page 14.

(3)

    

Interest earning assets include assets that earn interest/accretion or dividends. Any market value adjustments on investment securities or loans are excluded from interest earning assets.

(4)

    

Net interest margin represents net interest income, including accretion income on interest earning assets, as a percentage of average interest earning assets.

(5)

    

Interest rate spread represents the difference between the weighted average yield on interest earning assets and the weighted average cost of interest bearing liabilities.

(6)

Non-performing loans consist of non-accruing loans and restructured loans on non-accrual.

(7)

Non-performing assets include non-performing loans and other real estate owned.

(8)

Total loans are net of unearned discounts and fees.

13


NATIONAL BANK HOLDINGS CORPORATION

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

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

Tangible Common Book Value Ratios

September 30, 2021

June 30, 2021

    

December 31, 2020

September 30, 2020

Total shareholders' equity

$

844,716

$

851,866

$

820,691

$

799,357

Less: goodwill and core deposit intangible assets, net

 

(121,688)

 

(121,983)

 

(122,575)

 

(122,871)

Add: deferred tax liability related to goodwill

 

9,841

 

9,612

 

9,155

 

8,927

Tangible common equity (non-GAAP)

$

732,869

$

739,495

$

707,271

$

685,413

Total assets

$

7,100,991

$

7,136,128

$

6,659,950

$

6,600,676

Less: goodwill and core deposit intangible assets, net

 

(121,688)

 

(121,983)

 

(122,575)

 

(122,871)

Add: deferred tax liability related to goodwill

 

9,841

 

9,612

 

9,155

 

8,927

Tangible assets (non-GAAP)

$

6,989,144

$

7,023,757

$

6,546,530

$

6,486,732

Tangible common equity to tangible assets calculations:

Total shareholders' equity to total assets

11.90%

11.94%

12.32%

12.11%

Less: impact of goodwill and core deposit intangible assets, net

(1.41)%

(1.41)%

(1.52)%

(1.54)%

Tangible common equity to tangible assets (non-GAAP)

10.49%

10.53%

10.80%

10.57%

Tangible common book value per share calculations:

Tangible common equity (non-GAAP)

$

732,869

$

739,495

$

707,271

$

685,413

Divided by: ending shares outstanding

 

30,288,131

 

30,800,985

 

30,634,291

 

30,594,412

Tangible common book value per share (non-GAAP)

$

24.20

$

24.01

$

23.09

$

22.40

Tangible common book value per share, excluding accumulated other comprehensive income calculations:

Tangible common equity (non-GAAP)

$

732,869

$

739,495

$

707,271

$

685,413

Accumulated other comprehensive loss (income), net of tax

 

1,397

 

(1,695)

 

(9,766)

 

(11,080)

Tangible common book value, excluding accumulated other comprehensive loss (income), net of tax (non-GAAP)

 

734,266

 

737,800

 

697,505

 

674,333

Divided by: ending shares outstanding

 

30,288,131

 

30,800,985

 

30,634,291

 

30,594,412

Tangible common book value per share, excluding accumulated other comprehensive loss (income), net of tax (non-GAAP)

$

24.24

$

23.95

$

22.77

$

22.04

14


NATIONAL BANK HOLDINGS CORPORATION

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

Return on Average Tangible Assets and Return on Average Tangible Equity

As of and for the three months ended

As of and for the nine months ended

September 30, 

    

June 30, 

    

September 30, 

    

September 30, 

    

September 30, 

2021

    

2021

    

2020

    

2021

    

2020

Net income

$

19,825

$

24,200

$

27,893

$

70,837

$

61,422

Add: impact of core deposit intangible amortization expense, after tax

 

227

 

228

 

226

 

682

 

680

Net income adjusted for impact of core deposit intangible amortization expense, after tax

$

20,052

$

24,428

$

28,119

$

71,519

$

62,102

Average assets

$

7,116,141

$

7,056,894

$

6,483,016

$

6,977,494

$

6,222,442

Less: average goodwill and core deposit intangible asset, net of deferred tax liability related to goodwill

 

(112,026)

 

(112,552)

 

(114,122)

 

(112,320)

 

(114,406)

Average tangible assets (non-GAAP)

$

7,004,115

$

6,944,342

$

6,368,894

$

6,865,174

$

6,108,036

Average shareholders' equity

$

859,245

$

843,116

$

792,358

$

845,776

$

779,491

Less: average goodwill and core deposit intangible asset, net of deferred tax liability related to goodwill

 

(112,026)

 

(112,552)

 

(114,122)

 

(112,320)

 

(114,406)

Average tangible common equity (non-GAAP)

$

747,219

$

730,564

$

678,236

$

733,456

$

665,085

Return on average assets

1.11%

1.38%

1.71%

1.36%

1.32%

Return on average tangible assets (non-GAAP)

1.14%

1.41%

1.76%

1.39%

1.36%

Return on average equity

9.15%

11.51%

14.00%

11.20%

10.53%

Return on average tangible common equity (non-GAAP)

10.65%

13.41%

16.49%

13.04%

12.47%

Fully Taxable Equivalent Yield on Earning Assets and Net Interest Margin

As of and for the three months ended

As of and for the nine months ended

September 30, 

June 30, 

September 30, 

September 30, 

September 30, 

2021

2021

2020

2021

2020

Interest income

$

50,801

    

$

48,450

    

$

52,302

    

$

148,464

$

164,714

Add: impact of taxable equivalent adjustment

 

1,315

 

1,279

 

1,275

 

3,862

 

3,843

Interest income FTE (non-GAAP)

$

52,116

$

49,729

$

53,577

$

152,326

$

168,557

Net interest income

$

47,569

$

44,868

$

46,715

$

137,658

$

144,390

Add: impact of taxable equivalent adjustment

 

1,315

 

1,279

 

1,275

 

3,862

 

3,843

Net interest income FTE (non-GAAP)

$

48,884

$

46,147

$

47,990

$

141,520

$

148,233

Average earning assets

$

6,624,047

$

6,561,588

$

5,944,790

$

6,475,934

$

5,690,884

Yield on earning assets

 

3.04%

 

2.96%

 

3.50%

 

3.07%

 

3.87%

Yield on earning assets FTE (non-GAAP)

 

3.12%

 

3.04%

 

3.59%

 

3.14%

 

3.96%

Net interest margin

 

2.85%

 

2.74%

 

3.13%

 

2.84%

 

3.39%

Net interest margin FTE (non-GAAP)

 

2.93%

 

2.82%

 

3.21%

 

2.92%

 

3.48%

Efficiency Ratio

As of and for the three months ended

As of and for the nine months ended

    

September 30, 

    

June 30, 

    

September 30, 

    

September 30, 

    

September 30, 

    

2021

    

2021

    

2020

    

2021

    

2020

Net interest income

$

47,569

$

44,868

$

46,715

$

137,658

$

144,390

Add: impact of taxable equivalent adjustment

 

1,315

 

1,279

 

1,275

 

3,862

 

3,843

Net interest income, FTE (non-GAAP)

$

48,884

$

46,147

$

47,990

$

141,520

$

148,233

Non-interest income

$

28,522

$

25,266

$

44,532

$

87,149

$

106,901

Non-interest expense

$

51,314

$

46,343

$

55,321

$

147,325

$

157,752

Less: core deposit intangible asset amortization

(295)

 

(296)

 

(295)

 

(887)

 

(887)

Non-interest expense, adjusted for core deposit intangible asset amortization

$

51,019

$

46,047

$

55,026

$

146,438

$

156,865

Efficiency ratio

67.05%

65.66%

60.30%

65.14%

62.42%

Efficiency ratio FTE (non-GAAP)

65.91%

64.48%

59.47%

64.04%

61.48%

15