SFNC 8-K
Simmons First National Corp (SFNC)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM
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CURRENT REPORT
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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).
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| Item 2.02. | Results of Operations and Financial Condition. |
On January 27, 2022, the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
On January 27, 2022, the Registrant also issued an investor presentation, a copy of which is attached hereto as Exhibit 99.2 and is incorporated herein by reference.
The information provided pursuant to this Item 2.02, including Exhibits 99.1 and 99.2, is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (“Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Registrant under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
| Item 9.01. | Financial Statements and Exhibits. |
| Exhibit 99.1 | Press Release dated January 27, 2022 | |
| Exhibit 99.2 | Investor Presentation issued on January 27, 2022 | |
| Exhibit 104 | Cover Page Interactive Data File (embedded within the Inline XBRL Document) |
SIGNATURE
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.
| SIMMONS FIRST NATIONAL CORPORATION | ||
| Date: January 27, 2022 | By: | /s/ James M. Brogdon |
| James M. Brogdon | ||
| Executive Vice President, Chief Financial Officer and Treasurer | ||
Exhibit 99.1
| For Immediate Release: | January 27, 2022 |
SIMMONS FIRST NATIONAL CORPORATION REPORTS
RECORD EARNINGS FOR 2021
Board of Directors authorizes new $175 million share repurchase program after substantially exhausting prior program in January 2022 and approves a 6 percent increase in the quarterly cash dividend
| · | Net income of $271.2 million for the full year of 2021, up 6 percent from the full year of 2020 |
| · | Diluted EPS of $2.46 for the full year of 2021, up 6 percent compared to $2.31 for the full year of 2020 |
| · | Diluted EPS of $0.42 for the fourth quarter of 2021; core diluted EPS of $0.52 in the quarter |
| · | Newly funded loans and advances top $2.6 billion in the quarter; commercial loan pipeline increases for 5th consecutive quarter, up 56 percent on a linked quarter basis, and unfunded commitments rise 31 percent linked quarter |
| · | Total deposits rise to $19.4 billion at year-end 2021, up $2.4 billion since year-end 2020, reflecting continued growth and acquisition-related activity; change in mix coupled with ability to effectively manage rates results in 17 bps year-over-year decline in deposit costs |
| · | Asset quality metrics remain sound; nonperforming assets as a percentage of total assets at the end of 2021 were 0.31 percent, compared to 0.64 percent at the end of 2020, while net charge-offs totaled 13 basis points in 2021, compared to 45 basis points in 2020. Continued improvement in metrics and macroeconomic scenario models results in $1.3 million provision expense recapture in the fourth quarter |
| · | Strong capital position and ability to organically generate capital results in $211.3 million of capital returned to shareholders in 2021 through a combination of cash dividends and share repurchases. Approximately 2.6 million shares of common stock repurchased during the fourth quarter of 2021. Remaining capacity under the share repurchase program substantially exhausted in January 2022 |
| · | Book value per share ends the year at $28.82, representing a 5 percent increase year-over-year. Tangible book value per share at $17.71, a 7 percent increase year-over-year |
Pine Bluff, AR – Simmons First National Corporation (NASDAQ: SFNC) (the “Company” or “Simmons”) today reported record net income of $271.2 million for the year ended December 31, 2021, up $16.3 million, or 6 percent, compared to $254.9 million earned during the full year 2020. Diluted earnings per share for 2021 were $2.46, up $0.15, or 6 percent, compared to $2.31 earned in 2020. Included in 2021 results were $7.2 million in net after-tax merger related costs, gains on sale of branches and net branch right-sizing costs. Excluding the impact of these items, core earnings were $278.3 million for the year ended December 31, 2021, compared to $264.3 million for the full year of 2020. Core diluted earnings per share were $2.53 for 2021, compared to $2.40 for 2020.
Net income for the fourth quarter of 2021 was $48.2 million, compared to $53.0 million in the fourth quarter of 2020. Diluted earnings per share for the fourth quarter of 2021 were $0.42, compared to $0.49 for the fourth quarter of 2020. Included in fourth quarter 2021 results were $13.6 million (pre-tax) of merger related costs, primarily associated with the acquisitions of Landmark Community Bank (“Landmark”) and Triumph Bancshares, Inc. (“Triumph”), which were completed and integrated in early October 2021. Excluding the impact of merger related and net branch rightsizing costs, core earnings were $59.5 million in the fourth quarter of 2021, compared to $62.0 million in the fourth quarter of 2020.
P.O. BOX 7009 501 MAIN STREET PINE BLUFF, ARKANSAS 71611-7009 (870) 541-1000 www.simmonsbank.com
“Simmons delivered record earnings in 2021 while continuing to navigate the headwinds brought about by the pandemic and the resulting impact on economic and business conditions,” said George A. Makris, Jr, Simmons’ chairman and CEO. “In addition to our strong financial performance, the year also brought our return to M&A activity with our acquisitions of Landmark Community Bank and Triumph Bancshares, Inc., which have significantly enhanced our size and scale in Tennessee where we now rank as the 8th largest bank based on deposit market share. Shortly after the acquisition and integration of these two banks in October, we announced a definitive agreement to acquire Spirit of Texas Bancshares, Inc., which will further strengthen our Texas franchise and establish a platform for growth in Houston, Austin, San Antonio and College Station. We look forward to welcoming our new customers, associates and shareholders to the Simmons family later this year.”
“While overall loan growth was muted for much of the year given the high levels of liquidity throughout the system, we are beginning to see positive signs that indicate an increase in business activity and a return to more normalized loan demand. Newly funded loans and advances topped $2.6 billion in the fourth quarter while unfunded commitments, considered a leading indicator of future loan growth, rose 31 percent during the quarter. Equally important, our commercial loan pipeline rose for the fifth consecutive quarter and is more than double that of a year ago. We are encouraged by this positive momentum and believe that our strong capital position and outstanding deposit base well position us for another strong year in 2022.”
| Selected Highlights: | FY 2021 | FY 2020 | Q4 21 | Q4 20 |
| Net income | $271.2 million | $254.9 million | $48.2 million | $53.0 million |
| Diluted earnings per share | $2.46 | $2.31 | $0.42 | $0.49 |
| Return on avg assets | 1.15% | 1.18% | 0.77% | 0.96% |
| Return on avg common equity | 8.83% | 8.72% | 5.87% | 7.13% |
| Return on tangible common equity (1) | 14.99% | 15.25% | 9.98% | 12.48% |
| Core earnings (2) | $278.3 million | $264.3 million | $59.5 million | $62.0 million |
| Core diluted earnings per share (2) | $2.53 | $2.40 | $0.52 | $0.57 |
| Core return on avg assets (2) | 1.18% | 1.22% | 0.96% | 1.13% |
| Core return on avg common equity (2) | 9.06% | 9.05% | 7.24% | 8.34% |
| Core return on tangible common equity (1)(2) | 15.38% | 15.79% | 12.19% | 14.51% |
| Efficiency ratio (3) | 57.92% | 54.18% | 59.48% | 54.75% |
| Adjusted pre-tax, pre-provision earnings (2) | $293.9 million | $352.7 million | $73.7 million | $83.1 million |
| (1) | Return on tangible common equity excludes goodwill and other intangible assets and is a non-GAAP measurement. See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below. |
| (2) | Core and adjusted figures exclude non-core items and are non-GAAP measurements. See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below. |
| (3) | Efficiency is a non-GAAP measurement. See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below. |
Loans
|
($ in billions) |
Q4 21 | Q3 21 | Q2 21 | Q1 21 | Q4 20 |
| Total loans | $12.0 | $10.8 | $11.4 | $12.2 | $12.9 |
| Total loans excluding PPP | $11.9 | $10.6 | $10.9 | $11.4 | $12.0 |
Total loans at the end of the fourth quarter of 2021 were $12.0 billion, compared to $10.8 billion at the end of the third quarter of 2021 and $12.9 billion at the end of the fourth quarter of 2020. The decrease in total loans from a year ago reflects planned run-off in certain targeted portfolios, Paycheck Protection Program (“PPP”) loan forgiveness, and increased paydowns and payoffs that were exacerbated by higher than normal levels of liquidity made available during the pandemic. The increase in total loans on a linked quarter basis primarily reflects loans acquired in connection with the Landmark and Triumph acquisitions, and an increase in loan production, which offset paydowns and payoffs during the quarter.
At the same time, evidence suggests that loan demand is beginning to return to more normalized levels. During the fourth quarter of 2021, newly funded loans and advances totaled $2.6 billion, up from $1.5 billion during the third quarter of 2021. Unfunded commitments rose for the third consecutive quarter, including a 31 percent increase on a linked quarter basis. Momentum in our commercial pipeline continued during the quarter with all loan opportunities totaling $2.3 billion, an increase of 56 percent on a linked quarter basis and more than double the levels of a year ago. This marked the fifth consecutive quarter of increased activity in the commercial pipeline as each respective category showed double-digit increases from third quarter 2021 levels. Equally important, the increases were broad-based across most of our markets and across our business units.
Deposits
|
($ in billions) |
Q4 21 | Q3 21 | Q2 21 | Q1 21 | Q4 20 |
| Total deposits | $19.4 | $18.1 | $18.3 | $18.2 | $17.0 |
| Noninterest bearing deposits | $5.3 | $4.9 | $4.9 | $4.9 | $4.5 |
| Interest bearing deposits | $11.6 | $10.7 | $10.6 | $10.3 | $9.7 |
| Time deposits | $2.5 | $2.5 | $2.8 | $3.0 | $2.8 |
Total deposits at the end of the fourth quarter of 2021 were $19.4 billion, an increase of $2.4 billion, or 14 percent, from $17.0 billion at the end of the fourth quarter of 2020. Total noninterest bearing deposits accounts totaled $5.3 billion, up $843 million, or 19 percent, from $4.5 billion at the end of the fourth quarter a year ago. Interest bearing deposits (checking, savings and money market accounts) totaled $11.6 billion, up $1.9 billion, or 20 percent, compared to $9.7 billion at the end of 2020. The year-over-year increases in each of these categories reflects an increase in customers as well as acquired deposits from the Landmark and Triumph acquisitions. Time deposits totaled $2.5 billion at the end of the fourth quarter of 2021, down 13 percent compared to $2.8 billion at the end of 2020.
Net Interest Income
| Q4 21 | Q3 21 | Q2 21 | Q1 21 | Q4 20 | |
| Loan yield (1) | 4.58% | 4.76% | 4.73% | 4.75% | 4.74% |
| Security yield (1) | 1.74% | 1.77% | 1.97% | 2.36% | 2.48% |
| Cost of interest bearing deposits | 0.23% | 0.27% | 0.32% | 0.41% | 0.47% |
| Cost of deposits (2) | 0.17% | 0.20% | 0.24% | 0.30% | 0.34% |
| Cost of borrowed funds | 1.95% | 1.96% | 1.97% | 1.91% | 1.88% |
| Net interest spread (1) | 2.74% | 2.72% | 2.74% | 2.83% | 3.04% |
| Net interest margin (1) | 2.86% | 2.85% | 2.89% | 2.99% | 3.22% |
| (1) | Fully tax equivalent using an effective tax rate of 26.135%. |
| (2) | Includes noninterest bearing deposits. |
Net interest income for the fourth quarter of 2021 totaled $153.1 million, compared to $155.0 million in the fourth quarter of 2020, a decrease of 1 percent. Included in net interest income is accretion recognized on loans acquired, which totaled $5.8 million in the fourth quarter of 2021 and $9.0 million in the fourth quarter of 2020. Also included in net interest income is interest income on PPP loans, which totaled $5.1 million in the fourth quarter of 2021 and $6.5 million in the fourth quarter of 2020. The decrease in net interest income from a year ago reflects lower average loan balances, a decrease in loan yields and lower contributions from accretion and PPP loans, offset in part by our ability to successfully reduce deposit costs.
The yield on loans for the fourth quarter of 2021 was 4.58 percent, compared to 4.76 percent in the third quarter of 2021 and 4.74 percent in the fourth quarter of 2020. Cost of deposits for the fourth quarter of 2021 was 17 basis points, down 3 basis points on a linked quarter basis and down 17 basis points compared to the fourth quarter of 2020. Net interest margin on a fully taxable equivalent basis was 2.86 percent for the fourth quarter of 2021, compared to 2.85 percent in the third quarter of 2021 and 3.22 percent in the fourth quarter of 2020. Throughout 2021, the Company strategically redeployed excess liquidity through the purchase of investment securities, including short-term variable rate securities. At December 31, 2021, short-term, variable securities totaled approximately $1.5 billion.
Noninterest Income
Noninterest income for 2021 was $191.8 million, compared to $239.8 million recorded in 2020. The decrease in noninterest income was primarily due to a $39.3 million decrease in gains on sales of investment securities and a $12.7 million decrease in mortgage lending income, offset in part by a $3.5 million increase in debit and credit card fees as a result of an increased usage and a higher number of customers.
Noninterest income for the fourth quarter of 2021 was $46.6 million, compared to $41.8 million in the fourth quarter of 2020. The increase in noninterest income compared to a year ago was broad based as most of our fee-based businesses posted gains, including mortgage lending income up $2.1 million, service charges on deposit accounts up $1.1 million, debit and credit card fee up $1.0 million and wealth management fees up $0.8 million.
|
Select Noninterest Income Items ($ in millions) |
FY 2021 | FY 2020 | Q4 21 | Q4 20 |
| Service charges on deposit accounts | $43.2 | $43.1 | $11.9 | $10.8 |
| Wealth management fees | $31.2 | $30.4 | $8.0 | $7.2 |
| Debit and credit card fees (1) | $28.2 | $24.7 | $7.5 | $6.4 |
| Mortgage lending income | $21.8 | $34.5 | $5.0 | $3.0 |
| Bank owned life insurance | $8.9 | $5.8 | $2.8 | $1.5 |
| Gain on sale of securities | $15.5 | $54.8 | $(0.4) | - |
| Other income | $35.3 | $39.9 | $10.0 | $11.0 |
| Core other income (2) | $29.6 | $31.1 | $10.0 | $10.8 |
| (1) | During the second quarter of 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest income. Prior periods have been adjusted to reflect this reclassification. |
| (2) | Core figures exclude non-core items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below. |
Noninterest Expense
Noninterest expense for 2021 was $483.6 million, down $1.1 million, or less than 1 percent, compared to $484.7 million recorded in 2020. Included in 2021 noninterest expense are pre-tax, non-core items totaling $15.3 million that primarily consist of merger-related expenses ($15.9 million, pre-tax). Excluding these items, core noninterest expense for 2021 was $468.2 million, compared to core noninterest expense of $463.2 million for 2020. The increase was primarily attributable to an increase in salaries and benefits (+$6.9 million), offset in part by a decline in furniture and equipment expense (-$4.0 million).
Noninterest expense for the fourth quarter of 2021 totaled $141.6 million, compared to $125.8 million in the fourth quarter of 2020. Included in noninterest expense are pre-tax, non-core items totaling $15.2 million that primarily consisted of merger-related expenses ($13.6 million, pre-tax). Excluding these items, core noninterest expense for the fourth quarter of 2021 was $126.4 million, compared to $113.4 million in the fourth quarter of 2020. The increase in noninterest expense was primarily due to the addition of operating expenses associated with the acquired banks at the beginning of the quarter. Expected costs saves from the acquisitions are expected to be achieved, in their entirety, in 2022. During the fourth quarter of 2021, the Company also donated $2.5 million to the Simmons First Foundation.
|
Select Noninterest Expense Items ($ in millions) |
FY 2021 | FY 2020 | Q4 21 | Q4 20 |
| Salaries and employee benefits | $246.3 | $242.5 | $63.9 | $55.8 |
| Occupancy expense, net | $38.8 | $37.6 | $11.0 | $9.2 |
| Furniture and equipment expense | $19.9 | $24.0 | $4.7 | $5.9 |
| Merger related costs | $15.9 | $4.5 | $13.6 | $0.7 |
| Other operating expenses (1) | $153.6 | $165.2 | $45.7 | $52.0 |
| Core salaries and employee benefits (2) | $246.2 | $239.4 | $63.8 | $55.6 |
| Core other operating expenses (2) | $157.1 | $153.0 | $45.8 | $41.8 |
| (1) | During the second quarter of 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest income. Prior periods have been adjusted to reflect this reclassification. |
| (2) | Core figures exclude non-core items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below. |
Asset Quality
|
($ in millions) |
Q4 21 | Q3 21 | Q2 21 | Q1 21 | Q4 20 |
| Allowance for credit losses on loans to total loans | 1.71% | 1.87% | 2.00% | 1.93% | 1.85% |
| Allowance for credit losses on loans to nonperforming loans | 300% | 341% | 281% | 204% | 193% |
| Nonperforming loans to total loans | 0.57% | 0.55% | 0.71% | 0.95% | 0.96% |
| Net charge-off ratio (annualized) | 0.31% | 0.17% | (0.07%) | 0.10% | 0.52% |
| Net charge-off ratio YTD (annualized) | 0.13% | 0.06% | 0.01% | 0.10% | 0.45% |
| Total nonperforming loans | $68.6 | $59.4 | $80.9 | $115.5 | $123.5 |
| Total other nonperforming assets | $7.7 | $13.5 | $16.3 | $12.4 | $20.4 |
Credit quality metrics showed marked improvement throughout the year. Total nonperforming assets as a percentage of total assets were 0.31 percent at the end of 2021, compared to 0.64 percent at the end of 2020. Total nonperforming loans at the end of the fourth quarter of 2021 totaled $68.6 million, down $54.9 million compared to $123.5 million at the end of the fourth quarter a year ago. Net charge-offs as a percentage of average loans for the full year of 2021 were 13 basis points, down from 45 basis points reported for the full year of 2020. Net charge-offs for the fourth quarter of 2021 were 31 basis points, compared to 52 basis points for the fourth quarter of 2020. Provision for credit losses for the full year of 2021 was a credit of $32.7 million compared to expense of $75.0 million for the full year of 2020, reflecting positive trends in asset quality metrics throughout the year and improved economic modeling scenarios that in the prior year were negatively impacted by the corresponding impact of the pandemic on the macroeconomic environment. Provision for credit losses on loans during the fourth quarter of 2021 was a credit of $1.3 million, compared to expense of $6.9 million during the fourth quarter of 2020.
The allowance for credit losses on loans at the end of 2021 was $205.3 million, compared to $238.1 million at the end of 2020. During the fourth quarter of 2021, the Company recorded allowance of $13.4 million in connection with Purchase Credit Deteriorated loans acquired in the Landmark and Triumph acquisitions. The allowance to loan ratio ended 2021 at 1.71 percent, compared to 1.85 percent at the end of 2020, and the nonperforming loan coverage ratio was 300 percent at the end of 2021, compared to 193 percent at the end of 2020.
Capital
| Q4 21 | Q3 21 | Q2 21 | Q1 21 | Q4 20 | |
| Stockholders’ equity to total assets | 13.1% | 13.1% | 13.0% | 12.6% | 13.3% |
| Tangible common equity to tangible assets (1) | 8.5% | 8.4% | 8.4% | 7.9% | 8.5% |
| Regulatory common equity tier 1 ratio | 13.8% | 14.3% | 14.2% | 14.1% | 13.4% |
| Regulatory tier 1 leverage ratio | 9.1% | 9.1% | 9.0% | 9.0% | 9.1% |
| Regulatory tier 1 risk-based capital ratio | 13.8% | 14.3% | 14.2% | 14.1% | 13.4% |
| Regulatory total risk-based capital ratio | 16.8% | 17.4% | 17.5% | 17.5% | 16.8% |
| (1) | Tangible common equity to tangible assets is a non-GAAP measurement. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below. |
Total common stockholders’ equity at the end of 2021 was $3.2 billion, compared to $3.0 billion at the end of 2020. During the fourth quarter of 2021, the Company redeemed its outstanding preferred stock totaling approximately $767 thousand. Book value per share at the end of the fourth quarter of 2021 was $28.82, compared to $27.53 at the end of the fourth quarter of 2020. Tangible book value per share was $17.71 at the end of the fourth quarter of 2021, compared to $16.56 at the end of the fourth quarter of 2020. The ratio of stockholders’ equity to total assets at December 31, 2021 was 13.1 percent, while tangible common equity to tangible total assets was 8.5 percent. All of the Company’s regulatory capital ratios continue to significantly exceed “well-capitalized” guidelines, and it is noteworthy that the increase in book value per share and tangible book value per share was accomplished while also completing the acquisitions of Landmark and Triumph, paying cash dividends and actively utilizing the Company’s stock repurchase program.
Share Repurchase Program and Cash Dividend
As a result of the Company’s strong capital position and ability to organically generate capital, the Company’s board of directors has declared a quarterly cash dividend on the Company’s Class A common stock of $0.19 per share, which is payable on April 4, 2022, to shareholders of record as of March 15, 2022. The cash dividend rate represents an increase of $0.01 per share, or 6 percent, from the dividend paid for the same time period last year.
During the fourth quarter of 2021, the Company repurchased approximately 2.6 million shares of its Class A common stock at an average price of $29.69 pursuant to the Company’s stock repurchase program, which was originally approved in October 2019 (the “2019 Program”). Remaining capacity under the 2019 Program at the end of 2021 totaled approximately $20.6 million. During January 2022, the Company substantially exhausted the remaining capacity under the 2019 Program.
Therefore, the Company also announced today that its board of directors has authorized a new stock repurchase program (the “New Program”) under which the Company may repurchase up to $175,000,000 of its Class A common stock currently issued and outstanding. The New Program replaces the 2019 Program.
Under the New Program, the Company may repurchase shares of its common stock through open market and privately negotiated transactions or otherwise. The timing, pricing, and amount of any repurchases under the New Program will be determined by the Company’s management at its discretion based on a variety of factors, including, but not limited to, trading volume and market price of the Company’s common stock, corporate considerations, the Company’s working capital and investment requirements, general market and economic conditions, and legal requirements. The New Program does not obligate the Company to repurchase any common stock and may be modified, discontinued, or suspended at any time without prior notice. The Company anticipates funding for the New Program to come from available sources of liquidity, including cash on hand and future cash flow. The New Program will terminate on January 31, 2024 (unless terminated sooner).
Simmons First National Corporation
Simmons First National Corporation (NASDAQ: SFNC) is a Mid-South based financial holding company whose principal subsidiary, Simmons Bank, operates 199 financial centers in Arkansas, Missouri, Tennessee, Texas, Oklahoma and Kansas. Founded in 1903, Simmons Bank offers comprehensive financial solutions delivered with a client-centric approach. Simmons Bank was named to Forbes’ list of “World’s Best Banks” for the second consecutive year and ranked among the top 30 banks in Forbes’ list of “America’s Best Banks” for 2021. Additional information about Simmons and Simmons Bank can be found on our website at simmonsbank.com, by following @Simmons_Bank on Twitter or by visiting our newsroom.
Conference Call
Management will conduct a live conference call to review this information beginning at 9:00 a.m. Central Time today, Thursday, January 27, 2022. Interested persons can listen to this call by dialing toll-free 1-866-298-7926 (United States and Canada only) and asking for the Simmons First National Corporation conference call, conference ID 7373369. In addition, the call will be available live or in recorded version on the Company’s website at simmonsbank.com for at least 60 days.
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance. These measures adjust GAAP performance measures to, among other things, include the tax benefit associated with revenue items that are tax-exempt, as well as exclude from income available to common shareholders, non-interest income, and non-interest expense certain income and expenses related to significant non-core activities, including merger-related expenses, gain on sale of branches, early retirement program expenses and net branch right-sizing expenses. In addition, the Company also presents certain figures based on tangible common stockholders’ equity, tangible assets and tangible book value, which exclude goodwill and other intangible assets. The Company further presents certain figures that are exclusive of the impact of PPP loans. The Company’s management believes that these non-GAAP financial measures are useful to investors because they, among other things, present the results of the Company’s ongoing operations without the effect of mergers or other items not central to the Company’s ongoing business, as well as normalize for tax effects. Management, therefore, believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core businesses, and management uses these non-GAAP financial measures to assess the performance of the Company’s core businesses as related to prior financial periods. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.
Forward-Looking Statements
Certain statements in this news release may not be based on historical facts and should be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including, without limitation, statements made in Mr. Makris’s quotes, may be identified by reference to future periods or by the use of forward-looking terminology, such as “believe,” “budget,” “expect,” “foresee,” “anticipate,” “intend,” “indicate,” “target,” “estimate,” “plan,” “project,” “continue,” “contemplate,” “positions,” “prospects,” “predict,” or “potential,” by future conditional verbs such as “will,” “would,” “should,” “could,” “might” or “may,” or by variations of such words or by similar expressions. These forward-looking statements include, without limitation, statements relating to Simmons’ future growth, lending capacity and lending activity, loan demand, revenue, assets, asset quality, profitability, net interest margin, non-interest revenue, share repurchase program, acquisition strategy, digital banking initiatives, the Company’s ability to recruit and retain key employees, branch closures and branch sales, the adequacy of the allowance for credit losses, the ability of the Company to manage the impacts of the COVID-19 pandemic, and the impacts of the Company’s and its customers’ participation in the PPP. Any forward-looking statement speaks only as of the date of this news release, and Simmons undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release. By nature, forward-looking statements are based on various assumptions and involve inherent risk and uncertainties. Various factors, including, but not limited to, changes in economic conditions, credit quality, interest rates, loan demand, deposit flows, real estate values, the assumptions used in making the forward-looking statements, the securities markets generally or the price of Simmons’ common stock specifically, and information technology affecting the financial industry; the effect of steps the Company takes and has taken in response to the COVID-19 pandemic; the severity and duration of the pandemic, including the effectiveness of “booster” vaccination efforts and developments with respect to COVID-19 variants; the pace of recovery when the pandemic subsides and the heightened impact it has on many of the risks described herein; the effects of the COVID-19 pandemic on, among other things, the Company’s operations, liquidity, and credit quality; general economic and market conditions; unemployment; claims, damages, and fines related to litigation or government actions, including litigation or actions arising from the Company’s participation in and administration of programs related to the COVID-19 pandemic; changes in accounting principles relating to loan loss recognition (current expected credit losses, or CECL); the ability to obtain regulatory approvals and meet other closing conditions to the proposed merger of Spirit of Texas Bancshares, Inc. (“Spirit”) with and into the Company (“Proposed Transaction”); delay in closing the Proposed Transaction; difficulties and delays in integrating the acquired business or fully realizing cost savings and other benefits of the Proposed Transaction; the Company’s ability to manage and successfully integrate its mergers and acquisitions; cyber threats, attacks or events; reliance on third parties for key services; government legislation; and other factors, many of which are beyond the control of the Company, could cause actual results to differ materially from those projected in or contemplated by the forward-looking statements. Additional information on factors that might affect the Company’s financial results is included in the Company’s Form 10-K for the year ended December 31, 2020, and other reports that the Company has filed with or furnished to the U.S. Securities and Exchange Commission (the “SEC”), all of which are available from the SEC.
Important Additional Information and Where to Find It
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval with respect to the Proposed Transaction. No offer of securities shall be made except by means of a prospectus meeting the requirements of the Securities Act of 1933, as amended, and no offer to sell or solicitation of an offer to buy shall be made in any jurisdiction in which such offer, solicitation or sale would be unlawful.
In connection with the Proposed Transaction, the Company has filed with the SEC a registration statement on Form S-4 (the “Registration Statement”) to register the shares of Company common stock that will be issued to Spirit shareholders in the Proposed Transaction. The Registration Statement includes a proxy statement of Spirit and a prospectus of the Company (the “Proxy Statement/Prospectus”), and the Company and/or Spirit may file with the SEC other relevant documents concerning the Proposed Transaction. The definitive Proxy Statement/Prospectus is being mailed to shareholders of Spirit. SHAREHOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION CAREFULLY AND IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BY THE COMPANY AND/OR SPIRIT, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.
Free copies of the Proxy Statement/Prospectus, as well as other filings containing information about the Company and Spirit, may be obtained at the SEC’s Internet site (http://www.sec.gov), when they are filed by the Company or Spirit. You will also be able to obtain these documents, when they are filed, free of charge, from the Company at simmonsbank.com under the heading “Investor Relations” or from Spirit at www.sotb.com under the “Investor Relations” link. Copies of the Proxy Statement/Prospectus can also be obtained, free of charge, by directing a request to the Company at Simmons First National Corporation, 501 Main Street, Pine Bluff, Arkansas 71601, Attention: Ed Bilek, Director of Investor Relations, Email: [email protected] or [email protected], Telephone: (870) 541-1000; or by directing a request to Spirit at Spirit of Texas Bancshares, Inc., 1836 Spirit of Texas Way, Conroe, Texas 77301, Attention: Corporate Secretary, Email: [email protected], Telephone: (936) 521-1836.
Participants in the Solicitation
The Company, Spirit, and certain of their respective directors, executive officers and employees may be deemed to be participants in the solicitation of proxies from the shareholders of Spirit in connection with the Proposed Transaction. Information about the Company’s directors and executive officers is available in its proxy statement for its 2021 annual meeting of shareholders, which was filed with the SEC on April 15, 2021. Information about Spirit’s directors and executive officers is available in its proxy statement for its 2021 annual meeting of shareholders, which was filed with the SEC on April 9, 2021. Information regarding all of the persons who may, under the rules of the SEC, be deemed participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Proxy Statement/Prospectus regarding the Proposed Transaction and other relevant materials to be filed with the SEC when they become available. Free copies of these documents may be obtained as described in the preceding paragraph.
####
FOR MORE INFORMATION CONTACT:
Ed Bilek
EVP, Director of Investor Relations
Simmons First National Corporation
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Consolidated End of Period Balance Sheets | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and non-interest bearing balances due from banks | $ | 209,190 | $ | 225,500 | $ | 215,381 | $ | 227,713 | $ | 217,499 | ||||||||||
| Interest bearing balances due from banks and federal funds sold | 1,441,463 | 1,555,913 | 2,123,743 | 3,677,750 | 3,254,653 | |||||||||||||||
| Cash and cash equivalents | 1,650,653 | 1,781,413 | 2,339,124 | 3,905,463 | 3,472,152 | |||||||||||||||
| Interest bearing balances due from banks - time | 1,882 | 1,780 | 1,335 | 1,334 | 1,579 | |||||||||||||||
| Investment securities - held-to-maturity | 1,529,221 | 1,516,797 | 931,352 | 609,500 | 333,031 | |||||||||||||||
| Investment securities - available-for-sale | 7,113,545 | 6,822,203 | 6,556,581 | 4,528,348 | 3,473,598 | |||||||||||||||
| Mortgage loans held for sale | 36,356 | 34,628 | 36,011 | 63,655 | 137,378 | |||||||||||||||
| Other assets held for sale | 100 | 100 | 100 | 100 | 100 | |||||||||||||||
| Loans: | ||||||||||||||||||||
| Loans | 12,012,503 | 10,825,227 | 11,386,352 | 12,195,873 | 12,900,897 | |||||||||||||||
| Allowance for credit losses on loans | (205,332 | ) | (202,508 | ) | (227,239 | ) | (235,116 | ) | (238,050 | ) | ||||||||||
| Net loans | 11,807,171 | 10,622,719 | 11,159,113 | 11,960,757 | 12,662,847 | |||||||||||||||
| Premises and equipment | 483,469 | 463,924 | 429,587 | 427,540 | 441,692 | |||||||||||||||
| Premises held for sale | - | - | 6,090 | 13,613 | 15,008 | |||||||||||||||
| Foreclosed assets and other real estate owned | 6,032 | 11,759 | 15,239 | 11,168 | 18,393 | |||||||||||||||
| Interest receivable | 72,990 | 68,405 | 67,916 | 71,359 | 72,597 | |||||||||||||||
| Bank owned life insurance | 445,305 | 421,762 | 419,198 | 257,152 | 255,630 | |||||||||||||||
| Goodwill | 1,146,007 | 1,075,305 | 1,075,305 | 1,075,305 | 1,075,305 | |||||||||||||||
| Other intangible assets | 106,235 | 100,428 | 103,759 | 107,091 | 111,110 | |||||||||||||||
| Other assets | 325,793 | 304,707 | 282,449 | 315,732 | 289,332 | |||||||||||||||
| Total assets | $ | 24,724,759 | $ | 23,225,930 | $ | 23,423,159 | $ | 23,348,117 | $ | 22,359,752 | ||||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||
| Deposits: | ||||||||||||||||||||
| Non-interest bearing transaction accounts | $ | 5,325,318 | $ | 4,918,845 | $ | 4,893,959 | $ | 4,884,667 | $ | 4,482,091 | ||||||||||
| Interest bearing transaction accounts and savings deposits | 11,588,770 | 10,697,451 | 10,569,602 | 10,279,997 | 9,672,608 | |||||||||||||||
| Time deposits | 2,452,460 | 2,455,774 | 2,841,052 | 3,024,724 | 2,832,327 | |||||||||||||||
| Total deposits | 19,366,548 | 18,072,070 | 18,304,613 | 18,189,388 | 16,987,026 | |||||||||||||||
| Federal funds purchased and securities sold | ||||||||||||||||||||
| under agreements to repurchase | 185,403 | 217,276 | 187,215 | 323,053 | 299,111 | |||||||||||||||
| Other borrowings | 1,337,973 | 1,338,585 | 1,339,193 | 1,340,467 | 1,342,067 | |||||||||||||||
| Subordinated notes and debentures | 384,131 | 383,278 | 383,143 | 383,008 | 382,874 | |||||||||||||||
| Other liabilities held for sale | - | - | - | - | 154,620 | |||||||||||||||
| Accrued interest and other liabilities | 201,863 | 184,190 | 169,629 | 181,426 | 217,398 | |||||||||||||||
| Total liabilities | 21,475,918 | 20,195,399 | 20,383,793 | 20,417,342 | 19,383,096 | |||||||||||||||
| Stockholders' equity: | ||||||||||||||||||||
| Preferred stock | - | 767 | 767 | 767 | 767 | |||||||||||||||
| Common stock | 1,127 | 1,066 | 1,084 | 1,083 | 1,081 | |||||||||||||||
| Surplus | 2,164,989 | 1,974,561 | 2,021,128 | 2,017,188 | 2,014,076 | |||||||||||||||
| Undivided profits | 1,093,270 | 1,065,566 | 1,004,314 | 948,913 | 901,006 | |||||||||||||||
| Accumulated other comprehensive (loss) income: | ||||||||||||||||||||
| Unrealized (depreciation) appreciation on AFS securities | (10,545 | ) | (11,429 | ) | 12,073 | (37,176 | ) | 59,726 | ||||||||||||
| Total stockholders' equity | 3,248,841 | 3,030,531 | 3,039,366 | 2,930,775 | 2,976,656 | |||||||||||||||
| Total liabilities and stockholders' equity | $ | 24,724,759 | $ | 23,225,930 | $ | 23,423,159 | $ | 23,348,117 | $ | 22,359,752 | ||||||||||
| Page 1 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Consolidated Statements of Income - Quarter-to-Date | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands, except per share data) | ||||||||||||||||||||
| INTEREST INCOME | ||||||||||||||||||||
| Loans (including fees) | $ | 137,564 | $ | 132,216 | $ | 138,804 | $ | 146,424 | $ | 160,115 | ||||||||||
| Interest bearing balances due from banks and federal funds sold | 583 | 763 | 651 | 798 | 716 | |||||||||||||||
| Investment securities | 32,275 | 30,717 | 27,128 | 21,573 | 17,207 | |||||||||||||||
| Mortgage loans held for sale | 310 | 230 | 386 | 639 | 1,070 | |||||||||||||||
| TOTAL INTEREST INCOME | 170,732 | 163,926 | 166,969 | 169,434 | 179,108 | |||||||||||||||
| INTEREST EXPENSE | ||||||||||||||||||||
| Time deposits | 3,705 | 4,747 | 6,061 | 7,091 | 7,835 | |||||||||||||||
| Other deposits | 4,390 | 4,369 | 4,721 | 6,088 | 6,536 | |||||||||||||||
| Federal funds purchased and securities | ||||||||||||||||||||
| sold under agreements to repurchase | 72 | 70 | 192 | 245 | 284 | |||||||||||||||
| Other borrowings | 4,903 | 4,893 | 4,897 | 4,802 | 4,869 | |||||||||||||||
| Subordinated notes and debentures | 4,581 | 4,610 | 4,565 | 4,527 | 4,624 | |||||||||||||||
| TOTAL INTEREST EXPENSE | 17,651 | 18,689 | 20,436 | 22,753 | 24,148 | |||||||||||||||
| NET INTEREST INCOME | 153,081 | 145,237 | 146,533 | 146,681 | 154,960 | |||||||||||||||
| Provision for credit losses | (1,308 | ) | (19,890 | ) | (12,951 | ) | 1,445 | 6,943 | ||||||||||||
| NET INTEREST INCOME AFTER PROVISION | ||||||||||||||||||||
| FOR CREDIT LOSSES | 154,389 | 165,127 | 159,484 | 145,236 | 148,017 | |||||||||||||||
| NON-INTEREST INCOME | ||||||||||||||||||||
| Wealth management fees | 8,042 | 7,877 | 7,892 | 7,361 | 7,233 | |||||||||||||||
| Service charges on deposit accounts | 11,909 | 11,557 | 10,050 | 9,715 | 10,799 | |||||||||||||||
| Other service charges and fees | 1,762 | 1,964 | 2,048 | 1,922 | 1,783 | |||||||||||||||
| Mortgage lending income | 5,043 | 5,818 | 4,490 | 6,447 | 2,993 | |||||||||||||||
| Debit and credit card fees | 7,460 | 7,102 | 7,073 | 6,610 | 6,415 | |||||||||||||||
| Bank owned life insurance income | 2,768 | 2,573 | 2,038 | 1,523 | 1,481 | |||||||||||||||
| (Loss) gain on sale of securities, net | (348 | ) | 5,248 | 5,127 | 5,471 | 16 | ||||||||||||||
| Other income | 9,965 | 6,411 | 8,397 | 10,500 | 11,041 | |||||||||||||||
| TOTAL NON-INTEREST INCOME | 46,601 | 48,550 | 47,115 | 49,549 | 41,761 | |||||||||||||||
| NON-INTEREST EXPENSE | ||||||||||||||||||||
| Salaries and employee benefits | 63,832 | 61,902 | 60,261 | 60,340 | 55,762 | |||||||||||||||
| Occupancy expense, net | 11,033 | 9,361 | 9,103 | 9,300 | 9,182 | |||||||||||||||
| Furniture and equipment expense | 4,721 | 4,895 | 4,859 | 5,415 | 5,940 | |||||||||||||||
| Other real estate and foreclosure expense | 576 | 339 | 863 | 343 | 551 | |||||||||||||||
| Deposit insurance | 2,108 | 1,870 | 1,687 | 1,308 | 1,627 | |||||||||||||||
| Merger-related costs | 13,591 | 1,401 | 686 | 233 | 731 | |||||||||||||||
| Other operating expenses | 45,736 | 34,565 | 37,198 | 36,063 | 52,047 | |||||||||||||||
| TOTAL NON-INTEREST EXPENSE | 141,597 | 114,333 | 114,657 | 113,002 | 125,840 | |||||||||||||||
| NET INCOME BEFORE INCOME TAXES | 59,393 | 99,344 | 91,942 | 81,783 | 63,938 | |||||||||||||||
| Provision for income taxes | 11,155 | 18,770 | 17,018 | 14,363 | 10,970 | |||||||||||||||
| NET INCOME | 48,238 | 80,574 | 74,924 | 67,420 | 52,968 | |||||||||||||||
| Preferred stock dividends | 8 | 13 | 13 | 13 | 13 | |||||||||||||||
| NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ | 48,230 | $ | 80,561 | $ | 74,911 | $ | 67,407 | $ | 52,955 | ||||||||||
| BASIC EARNINGS PER SHARE | $ | 0.42 | $ | 0.75 | $ | 0.69 | $ | 0.62 | $ | 0.49 | ||||||||||
| DILUTED EARNINGS PER SHARE | $ | 0.42 | $ | 0.74 | $ | 0.69 | $ | 0.62 | $ | 0.49 | ||||||||||
| Page 2 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Consolidated Risk-Based Capital | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| Tier 1 capital | ||||||||||||||||||||
| Stockholders' equity | $ | 3,248,841 | $ | 3,030,531 | $ | 3,039,366 | $ | 2,930,775 | $ | 2,976,656 | ||||||||||
| CECL transition provision (1) | 114,458 | 122,787 | 128,933 | 131,637 | 131,430 | |||||||||||||||
| Disallowed intangible assets, net of deferred tax | (1,226,686 | ) | (1,152,688 | ) | (1,156,203 | ) | (1,159,720 | ) | (1,163,797 | ) | ||||||||||
| Unrealized loss (gain) on AFS securities | 10,545 | 11,429 | (12,073 | ) | 37,176 | (59,726 | ) | |||||||||||||
| Total Tier 1 capital | 2,147,158 | 2,012,059 | 2,000,023 | 1,939,868 | 1,884,563 | |||||||||||||||
| Tier 2 capital | ||||||||||||||||||||
| Trust preferred securities and subordinated debt | 384,131 | 383,278 | 383,143 | 383,008 | 382,874 | |||||||||||||||
| Qualifying allowance for loan losses and | ||||||||||||||||||||
| reserve for unfunded commitments | 71,853 | 60,700 | 79,138 | 87,251 | 89,546 | |||||||||||||||
| Total Tier 2 capital | 455,984 | 443,978 | 462,281 | 470,259 | 472,420 | |||||||||||||||
| Total risk-based capital | $ | 2,603,142 | $ | 2,456,037 | $ | 2,462,304 | $ | 2,410,127 | $ | 2,356,983 | ||||||||||
| Risk weighted assets | $ | 15,538,967 | $ | 14,098,320 | $ | 14,076,975 | $ | 13,771,244 | $ | 14,048,608 | ||||||||||
| Adjusted average assets for leverage ratio | $ | 23,647,901 | $ | 22,189,921 | $ | 22,244,118 | $ | 21,668,406 | $ | 20,765,127 | ||||||||||
| Ratios at end of quarter | ||||||||||||||||||||
| Equity to assets | 13.14 | % | 13.05 | % | 12.98 | % | 12.55 | % | 13.31 | % | ||||||||||
| Tangible common equity to tangible assets (2) | 8.51 | % | 8.41 | % | 8.36 | % | 7.88 | % | 8.45 | % | ||||||||||
| Common equity Tier 1 ratio (CET1) | 13.82 | % | 14.27 | % | 14.20 | % | 14.08 | % | 13.41 | % | ||||||||||
| Tier 1 leverage ratio | 9.08 | % | 9.07 | % | 8.99 | % | 8.95 | % | 9.08 | % | ||||||||||
| Tier 1 risk-based capital ratio | 13.82 | % | 14.27 | % | 14.21 | % | 14.09 | % | 13.41 | % | ||||||||||
| Total risk-based capital ratio | 16.75 | % | 17.42 | % | 17.49 | % | 17.50 | % | 16.78 | % | ||||||||||
(1) The Company has elected to use the CECL transition provision allowed for in the year of adopting ASC 326.
(2) Calculations of tangible common equity to tangible assets and the reconciliations to GAAP are included in the schedules accompanying this release.
| Page 3 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Consolidated Investment Securities | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| Investment Securities - End of Period | ||||||||||||||||||||
| Held-to-Maturity | ||||||||||||||||||||
| U.S. Government agencies | $ | 232,609 | $ | 232,549 | $ | 77,396 | $ | 77,396 | $ | - | ||||||||||
| Mortgage-backed securities | 70,342 | 57,930 | 60,649 | 47,988 | 22,354 | |||||||||||||||
| State and political subdivisions | 1,209,051 | 1,209,091 | 793,307 | 484,116 | 310,109 | |||||||||||||||
| Other securities | 17,219 | 17,227 | - | - | 568 | |||||||||||||||
| Total held-to-maturity (net of credit losses) | 1,529,221 | 1,516,797 | 931,352 | 609,500 | 333,031 | |||||||||||||||
| Available-for-Sale | ||||||||||||||||||||
| U.S. Treasury | $ | 300 | $ | 300 | $ | 600 | $ | 600 | $ | - | ||||||||||
| U.S. Government agencies | 364,641 | 354,382 | 554,937 | 487,679 | 477,237 | |||||||||||||||
| Mortgage-backed securities | 4,448,616 | 4,421,620 | 3,987,209 | 2,133,086 | 1,394,936 | |||||||||||||||
| State and political subdivisions | 1,819,658 | 1,575,208 | 1,557,497 | 1,571,910 | 1,470,723 | |||||||||||||||
| Other securities | 480,330 | 470,693 | 456,338 | 335,073 | 130,702 | |||||||||||||||
| Total available-for-sale (net of credit losses) | 7,113,545 | 6,822,203 | 6,556,581 | 4,528,348 | 3,473,598 | |||||||||||||||
| Total investment securities (net of credit losses) | $ | 8,642,766 | $ | 8,339,000 | $ | 7,487,933 | $ | 5,137,848 | $ | 3,806,629 | ||||||||||
| Fair value - HTM investment securities | $ | 1,517,378 | $ | 1,487,916 | $ | 935,596 | $ | 597,694 | $ | 341,925 | ||||||||||
| Investment Securities - QTD Average | ||||||||||||||||||||
| Taxable securities | $ | 5,790,429 | $ | 5,475,932 | $ | 4,265,545 | $ | 2,471,291 | $ | 1,757,234 | ||||||||||
| Tax exempt securities | 2,787,301 | 2,496,958 | 2,157,076 | 1,919,919 | 1,528,127 | |||||||||||||||
| Total investment securities - QTD average | $ | 8,577,730 | $ | 7,972,890 | $ | 6,422,621 | $ | 4,391,210 | $ | 3,285,361 | ||||||||||
| Page 4 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Consolidated Loans | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| Loan Portfolio - End of Period | ||||||||||||||||||||
| Consumer | ||||||||||||||||||||
| Credit cards | $ | 187,052 | $ | 175,884 | $ | 177,634 | $ | 175,458 | $ | 188,845 | ||||||||||
| Other consumer | 168,318 | 182,492 | 181,712 | 172,965 | 202,379 | |||||||||||||||
| Total consumer | 355,370 | 358,376 | 359,346 | 348,423 | 391,224 | |||||||||||||||
| Real Estate | ||||||||||||||||||||
| Construction | 1,327,210 | 1,229,740 | 1,428,165 | 1,451,841 | 1,596,255 | |||||||||||||||
| Single-family residential | 2,101,136 | 1,540,701 | 1,608,028 | 1,730,056 | 1,880,673 | |||||||||||||||
| Other commercial real estate | 5,738,904 | 5,308,902 | 5,332,655 | 5,638,010 | 5,746,863 | |||||||||||||||
| Total real estate | 9,167,250 | 8,079,343 | 8,368,848 | 8,819,907 | 9,223,791 | |||||||||||||||
| Commercial | ||||||||||||||||||||
| Commercial | 1,992,043 | 1,821,905 | 2,074,729 | 2,444,700 | 2,574,386 | |||||||||||||||
| Agricultural | 168,717 | 216,735 | 193,462 | 155,921 | 175,905 | |||||||||||||||
| Total commercial | 2,160,760 | 2,038,640 | 2,268,191 | 2,600,621 | 2,750,291 | |||||||||||||||
| Other | 329,123 | 348,868 | 389,967 | 426,922 | 535,591 | |||||||||||||||
| Total loans | $ | 12,012,503 | $ | 10,825,227 | $ | 11,386,352 | $ | 12,195,873 | $ | 12,900,897 | ||||||||||
| Page 5 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Consolidated Allowance and Asset Quality | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| Allowance for Credit Losses on Loans | ||||||||||||||||||||
| Beginning balance, after adoption of ASC 326 | $ | 202,508 | $ | 227,239 | $ | 235,116 | $ | 238,050 | $ | 248,251 | ||||||||||
| Day 1 PCD allowance from acquisitions | ||||||||||||||||||||
| Landmark (10/08/2021) | 2,359 | |||||||||||||||||||
| Triumph (10/08/2021) | 11,092 | |||||||||||||||||||
| Total Day 1 PCD allowance | 13,451 | |||||||||||||||||||
| Loans charged off | ||||||||||||||||||||
| Credit cards | 865 | 711 | 1,046 | 1,003 | 787 | |||||||||||||||
| Other consumer | 477 | 463 | 411 | 702 | 960 | |||||||||||||||
| Real estate | 2,624 | 5,941 | 439 | 1,687 | 10,415 | |||||||||||||||
| Commercial | 8,513 | 932 | 309 | 859 | 8,199 | |||||||||||||||
| Total loans charged off | 12,479 | 8,047 | 2,205 | 4,251 | 20,361 | |||||||||||||||
| Recoveries of loans previously charged off | ||||||||||||||||||||
| Credit cards | 247 | 267 | 244 | 290 | 241 | |||||||||||||||
| Other consumer | 267 | 408 | 425 | 304 | 355 | |||||||||||||||
| Real estate | 916 | 2,068 | 1,523 | 403 | 431 | |||||||||||||||
| Commercial | 1,730 | 463 | 2,147 | 320 | 1,835 | |||||||||||||||
| Total recoveries | 3,160 | 3,206 | 4,339 | 1,317 | 2,862 | |||||||||||||||
| Net loans charged off | 9,319 | 4,841 | (2,134 | ) | 2,934 | 17,499 | ||||||||||||||
| Provision for credit losses on loans | (1,308 | ) | (19,890 | ) | (10,011 | ) | - | 7,298 | ||||||||||||
| Balance, end of quarter | $ | 205,332 | $ | 202,508 | $ | 227,239 | $ | 235,116 | $ | 238,050 | ||||||||||
| Non-performing assets | ||||||||||||||||||||
| Non-performing loans | ||||||||||||||||||||
| Nonaccrual loans | $ | 68,204 | $ | 59,054 | $ | 80,282 | $ | 114,856 | $ | 122,879 | ||||||||||
| Loans past due 90 days or more | 349 | 334 | 653 | 635 | 578 | |||||||||||||||
| Total non-performing loans | 68,553 | 59,388 | 80,935 | 115,491 | 123,457 | |||||||||||||||
| Other non-performing assets | ||||||||||||||||||||
| Foreclosed assets and other real estate owned | 6,032 | 11,759 | 15,239 | 11,168 | 18,393 | |||||||||||||||
| Other non-performing assets | 1,667 | 1,724 | 1,062 | 1,229 | 2,016 | |||||||||||||||
| Total other non-performing assets | 7,699 | 13,483 | 16,301 | 12,397 | 20,409 | |||||||||||||||
| Total non-performing assets | $ | 76,252 | $ | 72,871 | $ | 97,236 | $ | 127,888 | $ | 143,866 | ||||||||||
| Performing TDRs (troubled debt restructurings) | $ | 4,289 | $ | 4,251 | $ | 4,436 | $ | 3,805 | $ | 3,138 | ||||||||||
| Ratios | ||||||||||||||||||||
| Allowance for credit losses on loans to total loans | 1.71 | % | 1.87 | % | 2.00 | % | 1.93 | % | 1.85 | % | ||||||||||
| Allowance for credit losses to non-performing loans | 300 | % | 341 | % | 281 | % | 204 | % | 193 | % | ||||||||||
| Non-performing loans to total loans | 0.57 | % | 0.55 | % | 0.71 | % | 0.95 | % | 0.96 | % | ||||||||||
| Non-performing assets (including performing TDRs) | ||||||||||||||||||||
| to total assets | 0.33 | % | 0.33 | % | 0.43 | % | 0.56 | % | 0.66 | % | ||||||||||
| Non-performing assets to total assets | 0.31 | % | 0.31 | % | 0.42 | % | 0.55 | % | 0.64 | % | ||||||||||
| Annualized net charge offs to total loans | 0.31 | % | 0.17 | % | -0.07 | % | 0.10 | % | 0.52 | % | ||||||||||
| Annualized net credit card charge offs to | ||||||||||||||||||||
| total credit card loans | 1.29 | % | 0.96 | % | 1.78 | % | 1.58 | % | 1.15 | % | ||||||||||
| Page 6 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||||||||||||||||||
| Consolidated - Average Balance Sheet and Net Interest Income Analysis | ||||||||||||||||||||||||||||||||||||
| For the Quarters Ended | ||||||||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||||||||
| Three
Months Ended Dec 2021 | Three
Months Ended Sep 2021 | Three
Months Ended Dec 2020 | ||||||||||||||||||||||||||||||||||
| ($ in thousands) | Average Balance | Income/ Expense | Yield/ Rate | Average Balance | Income/ Expense | Yield/ Rate | Average Balance | Income/ Expense | Yield/ Rate | |||||||||||||||||||||||||||
| ASSETS | ||||||||||||||||||||||||||||||||||||
| Earning assets: | ||||||||||||||||||||||||||||||||||||
| Interest bearing balances due from banks | ||||||||||||||||||||||||||||||||||||
| and federal funds sold | $ | 1,484,752 | $ | 583 | 0.16 | % | $ | 1,866,530 | $ | 763 | 0.16 | % | $ | 2,651,938 | $ | 716 | 0.11 | % | ||||||||||||||||||
| Investment securities - taxable | 5,790,429 | 17,186 | 1.18 | % | 5,475,932 | 17,076 | 1.24 | % | 1,757,234 | 7,720 | 1.75 | % | ||||||||||||||||||||||||
| Investment securities - non-taxable (FTE) | 2,787,301 | 20,470 | 2.91 | % | 2,496,958 | 18,399 | 2.92 | % | 1,528,127 | 12,778 | 3.33 | % | ||||||||||||||||||||||||
| Mortgage loans held for sale | 42,866 | 310 | 2.87 | % | 32,134 | 230 | 2.84 | % | 179,275 | 1,070 | 2.37 | % | ||||||||||||||||||||||||
| Loans - including fees (FTE) | 11,924,444 | 137,762 | 4.58 | % | 11,030,438 | 132,399 | 4.76 | % | 13,457,077 | 160,306 | 4.74 | % | ||||||||||||||||||||||||
| Total interest earning assets (FTE) | 22,029,792 | 176,311 | 3.18 | % | 20,901,992 | 168,867 | 3.21 | % | 19,573,651 | 182,590 | 3.71 | % | ||||||||||||||||||||||||
| Non-earning assets | 2,668,230 | 2,353,549 | 2,278,443 | |||||||||||||||||||||||||||||||||
| Total assets | $ | 24,698,022 | $ | 23,255,541 | $ | 21,852,094 | ||||||||||||||||||||||||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||||||||||||||||||
| Interest bearing liabilities: | ||||||||||||||||||||||||||||||||||||
| Interest bearing transaction and | ||||||||||||||||||||||||||||||||||||
| savings accounts | $ | 11,413,325 | $ | 4,390 | 0.15 | % | $ | 10,629,142 | $ | 4,369 | 0.16 | % | $ | 9,389,570 | $ | 6,536 | 0.28 | % | ||||||||||||||||||
| Time deposits | 2,607,011 | 3,705 | 0.56 | % | 2,645,896 | 4,747 | 0.71 | % | 2,823,166 | 7,835 | 1.10 | % | ||||||||||||||||||||||||
| Total interest bearing deposits | 14,020,336 | 8,095 | 0.23 | % | 13,275,038 | 9,116 | 0.27 | % | 12,212,736 | 14,371 | 0.47 | % | ||||||||||||||||||||||||
| Federal funds purchased and securities | ||||||||||||||||||||||||||||||||||||
| sold under agreement to repurchase | 223,008 | 72 | 0.13 | % | 219,604 | 70 | 0.13 | % | 340,333 | 284 | 0.33 | % | ||||||||||||||||||||||||
| Other borrowings | 1,340,825 | 4,903 | 1.45 | % | 1,338,866 | 4,893 | 1.45 | % | 1,342,403 | 4,869 | 1.44 | % | ||||||||||||||||||||||||
| Subordinated notes and debentures | 383,489 | 4,581 | 4.74 | % | 383,213 | 4,610 | 4.77 | % | 382,808 | 4,624 | 4.81 | % | ||||||||||||||||||||||||
| Total interest bearing liabilities | 15,967,658 | 17,651 | 0.44 | % | 15,216,721 | 18,689 | 0.49 | % | 14,278,280 | 24,148 | 0.67 | % | ||||||||||||||||||||||||
| Non-interest bearing liabilities: | ||||||||||||||||||||||||||||||||||||
| Non-interest bearing deposits | 5,288,933 | 4,803,171 | 4,413,168 | |||||||||||||||||||||||||||||||||
| Other liabilities | 179,362 | 167,677 | 204,014 | |||||||||||||||||||||||||||||||||
| Total liabilities | 21,435,953 | 20,187,569 | 18,895,462 | |||||||||||||||||||||||||||||||||
| Stockholders' equity | 3,262,069 | 3,067,972 | 2,956,632 | |||||||||||||||||||||||||||||||||
| Total liabilities and stockholders' equity | $ | 24,698,022 | $ | 23,255,541 | $ | 21,852,094 | ||||||||||||||||||||||||||||||
| Net interest income (FTE) | $ | 158,660 | $ | 150,178 | $ | 158,442 | ||||||||||||||||||||||||||||||
| Net interest spread (FTE) | 2.74 | % | 2.72 | % | 3.04 | % | ||||||||||||||||||||||||||||||
| Net interest margin (FTE) - quarter-to-date | 2.86 | % | 2.85 | % | 3.22 | % | ||||||||||||||||||||||||||||||
| Net interest margin (FTE) - year-to-date | 2.89 | % | 2.91 | % | 3.38 | % | ||||||||||||||||||||||||||||||
| Page 7 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Consolidated - Selected Financial Data | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands, except share data) | ||||||||||||||||||||
| QUARTER-TO-DATE | ||||||||||||||||||||
| Financial Highlights - GAAP | ||||||||||||||||||||
| Net Income | $ | 48,230 | $ | 80,561 | $ | 74,911 | $ | 67,407 | $ | 52,955 | ||||||||||
| Diluted earnings per share | 0.42 | 0.74 | 0.69 | 0.62 | 0.49 | |||||||||||||||
| Return on average assets | 0.77 | % | 1.37 | % | 1.29 | % | 1.20 | % | 0.96 | % | ||||||||||
| Return on average common equity | 5.87 | % | 10.42 | % | 10.08 | % | 9.20 | % | 7.13 | % | ||||||||||
| Return on tangible common equity | 9.98 | % | 17.43 | % | 17.25 | % | 15.85 | % | 12.48 | % | ||||||||||
| Net interest margin (FTE) | 2.86 | % | 2.85 | % | 2.89 | % | 2.99 | % | 3.22 | % | ||||||||||
| FTE adjustment | 5,579 | 4,941 | 4,548 | 4,163 | 3,482 | |||||||||||||||
| Average diluted shares outstanding | 114,491,119 | 108,359,890 | 108,822,175 | 108,655,293 | 108,888,264 | |||||||||||||||
| Shares repurchased under plan | 2,625,348 | 1,806,205 | - | 130,916 | 1,034,364 | |||||||||||||||
| Average price of shares repurchased | 29.69 | 28.48 | - | 23.53 | 19.36 | |||||||||||||||
| Cash dividends declared per common share | 0.18 | 0.18 | 0.18 | 0.18 | 0.17 | |||||||||||||||
| Financial Highlights - Core (non-GAAP) | ||||||||||||||||||||
| Core earnings (excludes non-core items) (1) | $ | 59,486 | $ | 79,350 | $ | 75,435 | $ | 63,995 | $ | 61,977 | ||||||||||
| Core diluted earnings per share (1) | 0.52 | 0.73 | 0.69 | 0.59 | 0.57 | |||||||||||||||
| Accretable yield on acquired loans | 5,758 | 4,122 | 5,619 | 6,630 | 8,999 | |||||||||||||||
| Efficiency ratio (1) | 59.48 | % | 58.10 | % | 56.75 | % | 57.25 | % | 54.75 | % | ||||||||||
| Core return on average assets (1) | 0.96 | % | 1.35 | % | 1.30 | % | 1.14 | % | 1.13 | % | ||||||||||
| Core return on average common equity (1) | 7.24 | % | 10.26 | % | 10.15 | % | 8.73 | % | 8.34 | % | ||||||||||
| Core return on tangible common equity (1) | 12.19 | % | 17.18 | % | 17.36 | % | 15.08 | % | 14.51 | % | ||||||||||
| YEAR-TO-DATE | ||||||||||||||||||||
| Financial Highlights - GAAP | ||||||||||||||||||||
| Net Income | $ | 271,109 | $ | 222,879 | $ | 142,318 | $ | 67,407 | $ | 254,852 | ||||||||||
| Diluted earnings per share | 2.46 | 2.05 | 1.31 | 0.62 | 2.31 | |||||||||||||||
| Return on average assets | 1.15 | % | 1.29 | % | 1.25 | % | 1.20 | % | 1.18 | % | ||||||||||
| Return on average common equity | 8.83 | % | 9.91 | % | 9.64 | % | 9.20 | % | 8.72 | % | ||||||||||
| Return on tangible common equity | 14.99 | % | 16.86 | % | 16.56 | % | 15.85 | % | 15.25 | % | ||||||||||
| Net interest margin (FTE) | 2.89 | % | 2.91 | % | 2.94 | % | 2.99 | % | 3.38 | % | ||||||||||
| FTE adjustment | 19,231 | 13,652 | 8,711 | 4,163 | 11,001 | |||||||||||||||
| Average diluted shares outstanding | 110,198,094 | 108,667,928 | 108,746,439 | 108,655,293 | 110,173,661 | |||||||||||||||
| Cash dividends declared per common share | 0.72 | 0.54 | 0.36 | 0.18 | 0.68 | |||||||||||||||
| Financial Highlights - Core (non-GAAP) | ||||||||||||||||||||
| Core earnings (excludes non-core items) (1) | $ | 278,266 | $ | 218,780 | $ | 139,430 | $ | 63,995 | $ | 264,300 | ||||||||||
| Core diluted earnings per share (1) | 2.53 | 2.01 | 1.28 | 0.59 | 2.40 | |||||||||||||||
| Accretable yield on acquired loans | 22,129 | 16,371 | 12,249 | 6,630 | 41,507 | |||||||||||||||
| Efficiency ratio (1) | 57.92 | % | 57.37 | % | 57.00 | % | 57.25 | % | 54.18 | % | ||||||||||
| Core return on average assets (1) | 1.18 | % | 1.27 | % | 1.22 | % | 1.14 | % | 1.22 | % | ||||||||||
| Core return on average common equity (1) | 9.06 | % | 9.73 | % | 9.45 | % | 8.73 | % | 9.05 | % | ||||||||||
| Core return on tangible common equity (1) | 15.38 | % | 16.56 | % | 16.23 | % | 15.08 | % | 15.79 | % | ||||||||||
| END OF PERIOD | ||||||||||||||||||||
| Book value per share | $ | 28.82 | $ | 28.42 | $ | 28.03 | $ | 27.04 | $ | 27.53 | ||||||||||
| Tangible book value per share | 17.71 | 17.39 | 17.16 | 16.13 | 16.56 | |||||||||||||||
| Shares outstanding | 112,715,444 | 106,603,231 | 108,386,669 | 108,345,732 | 108,077,662 | |||||||||||||||
| Full-time equivalent employees | 2,877 | 2,740 | 2,783 | 2,817 | 2,827 | |||||||||||||||
| Total number of financial centers | 199 | 185 | 198 | 198 | 204 | |||||||||||||||
(1) Core earnings exclude non-core items, which is a non-GAAP measurement. Reconciliations to GAAP are included in the schedules accompanying this release.
| Page 8 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - Core Earnings - Quarter-to-Date | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands, except per share data) | ||||||||||||||||||||
| QUARTER-TO-DATE | ||||||||||||||||||||
| Net Income | $ | 48,230 | $ | 80,561 | $ | 74,911 | $ | 67,407 | $ | 52,955 | ||||||||||
| Non-core items | ||||||||||||||||||||
| Gain on sale of branches | - | - | (16 | ) | (5,300 | ) | (275 | ) | ||||||||||||
| Merger-related costs | 13,591 | 1,401 | 686 | 233 | 731 | |||||||||||||||
| Early retirement program | - | - | - | - | 62 | |||||||||||||||
| Branch right-sizing (net) | 1,648 | (3,041 | ) | 39 | 448 | 11,696 | ||||||||||||||
| Tax effect (1) | (3,983 | ) | 429 | (185 | ) | 1,207 | (3,192 | ) | ||||||||||||
| Net non-core items | 11,256 | (1,211 | ) | 524 | (3,412 | ) | 9,022 | |||||||||||||
| Core earnings (non-GAAP) | $ | 59,486 | $ | 79,350 | $ | 75,435 | $ | 63,995 | $ | 61,977 | ||||||||||
| Diluted earnings per share | $ | 0.42 | $ | 0.74 | $ | 0.69 | $ | 0.62 | $ | 0.49 | ||||||||||
| Non-core items | ||||||||||||||||||||
| Gain on sale of branches | - | - | - | (0.05 | ) | - | ||||||||||||||
| Merger-related costs | 0.12 | 0.01 | 0.01 | - | - | |||||||||||||||
| Early retirement program | - | - | - | - | - | |||||||||||||||
| Branch right-sizing (net) | 0.01 | (0.03 | ) | - | 0.01 | 0.11 | ||||||||||||||
| Tax effect (1) | (0.03 | ) | 0.01 | (0.01 | ) | 0.01 | (0.03 | ) | ||||||||||||
| Net non-core items | 0.10 | (0.01 | ) | - | (0.03 | ) | 0.08 | |||||||||||||
| Core diluted earnings per share (non-GAAP) | $ | 0.52 | $ | 0.73 | $ | 0.69 | $ | 0.59 | $ | 0.57 | ||||||||||
| (1) Effective tax rate of 26.135%. | ||||||||||||||||||||
| Reconciliation of Selected Non-Core Non-Interest Income and Expense Items (non-GAAP) | ||||||||||||||||||||
| QUARTER-TO-DATE | ||||||||||||||||||||
| Other income | $ | 9,965 | $ | 6,411 | $ | 8,397 | $ | 10,500 | $ | 11,041 | ||||||||||
| Non-core items (1) | (2 | ) | 239 | (445 | ) | (5,477 | ) | (275 | ) | |||||||||||
| Core other income (non-GAAP) | $ | 9,963 | $ | 6,650 | $ | 7,952 | $ | 5,023 | $ | 10,766 | ||||||||||
| Non-interest expense | $ | 141,597 | $ | 114,333 | $ | 114,657 | $ | 113,002 | $ | 125,840 | ||||||||||
| Non-core items (1) | (15,241 | ) | 1,879 | (1,154 | ) | (858 | ) | (12,489 | ) | |||||||||||
| Core non-interest expense (non-GAAP) | $ | 126,356 | $ | 116,212 | $ | 113,503 | $ | 112,144 | $ | 113,351 | ||||||||||
| Salaries and employee benefits | $ | 63,832 | $ | 61,902 | $ | 60,261 | $ | 60,340 | $ | 55,762 | ||||||||||
| Non-core items (1) | - | (66 | ) | - | - | (144 | ) | |||||||||||||
| Core salaries and employee benefits (non-GAAP) | $ | 63,832 | $ | 61,836 | $ | 60,261 | $ | 60,340 | $ | 55,618 | ||||||||||
| Merger related costs | $ | 13,591 | $ | 1,401 | $ | 686 | $ | 233 | $ | 731 | ||||||||||
| Non-core items (1) | (13,591 | ) | (1,401 | ) | (686 | ) | (233 | ) | (731 | ) | ||||||||||
| Core merger related costs (non-GAAP) | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
| Other operating expenses | $ | 45,736 | $ | 34,565 | $ | 37,198 | $ | 36,063 | $ | 52,047 | ||||||||||
| Non-core items (1) | 96 | 3,759 | (89 | ) | (208 | ) | (10,270 | ) | ||||||||||||
| Core other operating expenses (non-GAAP) | $ | 45,832 | $ | 38,324 | $ | 37,109 | $ | 35,855 | $ | 41,777 | ||||||||||
(1) Non-core items include gain on sale of branches, merger related costs, early retirement program expenses and branch right-sizing costs.
| Page 9 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - Core Earnings - Year-to-Date | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands, except per share data) | ||||||||||||||||||||
| YEAR-TO-DATE | ||||||||||||||||||||
| Net Income | $ | 271,109 | $ | 222,879 | $ | 142,318 | $ | 67,407 | $ | 254,852 | ||||||||||
| Non-core items | ||||||||||||||||||||
| Gain on sale of branches | (5,316 | ) | (5,316 | ) | (5,316 | ) | (5,300 | ) | (8,368 | ) | ||||||||||
| Merger-related costs | 15,911 | 2,320 | 919 | 233 | 4,531 | |||||||||||||||
| Early retirement program | - | - | - | - | 2,901 | |||||||||||||||
| Branch right-sizing (net) | (906 | ) | (2,554 | ) | 487 | 448 | 13,727 | |||||||||||||
| Tax effect (1) | (2,532 | ) | 1,451 | 1,022 | 1,207 | (3,343 | ) | |||||||||||||
| Net non-core items | 7,157 | (4,099 | ) | (2,888 | ) | (3,412 | ) | 9,448 | ||||||||||||
| Core earnings (non-GAAP) | $ | 278,266 | $ | 218,780 | $ | 139,430 | $ | 63,995 | $ | 264,300 | ||||||||||
| Diluted earnings per share | $ | 2.46 | $ | 2.05 | $ | 1.31 | $ | 0.62 | $ | 2.31 | ||||||||||
| Non-core items | ||||||||||||||||||||
| Gain on sale of branches | (0.05 | ) | (0.05 | ) | (0.05 | ) | (0.05 | ) | (0.07 | ) | ||||||||||
| Merger-related costs | 0.15 | 0.02 | 0.01 | - | 0.04 | |||||||||||||||
| Early retirement program | - | - | - | - | 0.03 | |||||||||||||||
| Branch right-sizing (net) | (0.01 | ) | (0.02 | ) | - | 0.01 | 0.12 | |||||||||||||
| Tax effect (1) | (0.02 | ) | 0.01 | 0.01 | 0.01 | (0.03 | ) | |||||||||||||
| Net non-core items | 0.07 | (0.04 | ) | (0.03 | ) | (0.03 | ) | 0.09 | ||||||||||||
| Core diluted earnings per share (non-GAAP) | $ | 2.53 | $ | 2.01 | $ | 1.28 | $ | 0.59 | $ | 2.40 | ||||||||||
| (1) Effective tax rate of 26.135%. | ||||||||||||||||||||
| Reconciliation of Selected Non-Core Non-Interest Income and Expense Items (non-GAAP) | ||||||||||||||||||||
| YEAR-TO-DATE | ||||||||||||||||||||
| Other income | $ | 35,273 | $ | 25,308 | $ | 18,897 | $ | 10,500 | $ | 39,876 | ||||||||||
| Non-core items (1) | (5,685 | ) | (5,683 | ) | (5,922 | ) | (5,477 | ) | (8,738 | ) | ||||||||||
| Core other income (non-GAAP) | $ | 29,588 | $ | 19,625 | $ | 12,975 | $ | 5,023 | $ | 31,138 | ||||||||||
| Non-interest expense | $ | 483,589 | $ | 341,992 | $ | 227,659 | $ | 113,002 | $ | 484,736 | ||||||||||
| Non-core items (1) | (15,374 | ) | (133 | ) | (2,012 | ) | (858 | ) | (21,529 | ) | ||||||||||
| Core non-interest expense (non-GAAP) | $ | 468,215 | $ | 341,859 | $ | 225,647 | $ | 112,144 | $ | 463,207 | ||||||||||
| Salaries and employee benefits | $ | 246,335 | $ | 182,503 | $ | 120,601 | $ | 60,340 | $ | 242,474 | ||||||||||
| Non-core items (1) | (66 | ) | (66 | ) | - | - | (3,085 | ) | ||||||||||||
| Core salaries and employee benefits (non-GAAP) | $ | 246,269 | $ | 182,437 | $ | 120,601 | $ | 60,340 | $ | 239,389 | ||||||||||
| Merger related costs | $ | 15,911 | $ | 2,320 | $ | 919 | $ | 233 | $ | 4,531 | ||||||||||
| Non-core items (1) | (15,911 | ) | (2,320 | ) | (919 | ) | (233 | ) | (4,531 | ) | ||||||||||
| Core merger related costs (non-GAAP) | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
| Other operating expenses | $ | 153,562 | $ | 107,826 | $ | 73,261 | $ | 36,063 | $ | 165,201 | ||||||||||
| Non-core items (1) | 3,558 | 3,462 | (297 | ) | (208 | ) | (12,155 | ) | ||||||||||||
| Core other operating expenses (non-GAAP) | $ | 157,120 | $ | 111,288 | $ | 72,964 | $ | 35,855 | $ | 153,046 | ||||||||||
(1) Non-core items include gain on sale of branches, merger related costs, early retirement program expenses and branch right-sizing costs.
| Page 10 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - End of Period | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands, except per share data) | ||||||||||||||||||||
| Calculation of Tangible Common Equity and the Ratio of Tangible Common Equity to Tangible Assets | ||||||||||||||||||||
| Total common stockholders' equity | $ | 3,248,841 | $ | 3,029,764 | $ | 3,038,599 | $ | 2,930,008 | $ | 2,975,889 | ||||||||||
| Intangible assets: | ||||||||||||||||||||
| Goodwill | (1,146,007 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | ||||||||||
| Other intangible assets | (106,235 | ) | (100,428 | ) | (103,759 | ) | (107,091 | ) | (111,110 | ) | ||||||||||
| Total intangibles | (1,252,242 | ) | (1,175,733 | ) | (1,179,064 | ) | (1,182,396 | ) | (1,186,415 | ) | ||||||||||
| Tangible common stockholders' equity | $ | 1,996,599 | $ | 1,854,031 | $ | 1,859,535 | $ | 1,747,612 | $ | 1,789,474 | ||||||||||
| Total assets | $ | 24,724,759 | $ | 23,225,930 | $ | 23,423,159 | $ | 23,348,117 | $ | 22,359,752 | ||||||||||
| Intangible assets: | ||||||||||||||||||||
| Goodwill | (1,146,007 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | ||||||||||
| Other intangible assets | (106,235 | ) | (100,428 | ) | (103,759 | ) | (107,091 | ) | (111,110 | ) | ||||||||||
| Total intangibles | (1,252,242 | ) | (1,175,733 | ) | (1,179,064 | ) | (1,182,396 | ) | (1,186,415 | ) | ||||||||||
| Tangible assets | $ | 23,472,517 | $ | 22,050,197 | $ | 22,244,095 | $ | 22,165,721 | $ | 21,173,337 | ||||||||||
| Paycheck protection program ("PPP") loans | (116,659 | ) | (212,087 | ) | (441,353 | ) | (797,629 | ) | (904,673 | ) | ||||||||||
| Total assets excluding PPP loans | $ | 24,608,100 | $ | 23,013,843 | $ | 22,981,806 | $ | 22,550,488 | $ | 21,455,079 | ||||||||||
| Tangible assets excluding PPP loans | $ | 23,355,858 | $ | 21,838,110 | $ | 21,802,742 | $ | 21,368,092 | $ | 20,268,664 | ||||||||||
| Ratio of common equity to assets | 13.14 | % | 13.04 | % | 12.97 | % | 12.55 | % | 13.31 | % | ||||||||||
| Ratio of common equity to assets excluding PPP loans | 13.20 | % | 13.16 | % | 13.22 | % | 12.99 | % | 13.87 | % | ||||||||||
| Ratio of tangible common equity to tangible assets | 8.51 | % | 8.41 | % | 8.36 | % | 7.88 | % | 8.45 | % | ||||||||||
| Ratio of tangible common equity to tangible assets excluding PPP loans | 8.55 | % | 8.49 | % | 8.53 | % | 8.18 | % | 8.83 | % | ||||||||||
| Calculation of Tangible Book Value per Share | ||||||||||||||||||||
| Total common stockholders' equity | $ | 3,248,841 | $ | 3,029,764 | $ | 3,038,599 | $ | 2,930,008 | $ | 2,975,889 | ||||||||||
| Intangible assets: | ||||||||||||||||||||
| Goodwill | (1,146,007 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | ||||||||||
| Other intangible assets | (106,235 | ) | (100,428 | ) | (103,759 | ) | (107,091 | ) | (111,110 | ) | ||||||||||
| Total intangibles | (1,252,242 | ) | (1,175,733 | ) | (1,179,064 | ) | (1,182,396 | ) | (1,186,415 | ) | ||||||||||
| Tangible common stockholders' equity | $ | 1,996,599 | $ | 1,854,031 | $ | 1,859,535 | $ | 1,747,612 | $ | 1,789,474 | ||||||||||
| Shares of common stock outstanding | 112,715,444 | 106,603,231 | 108,386,669 | 108,345,732 | 108,077,662 | |||||||||||||||
| Book value per common share | $ | 28.82 | $ | 28.42 | $ | 28.03 | $ | 27.04 | $ | 27.53 | ||||||||||
| Tangible book value per common share | $ | 17.71 | $ | 17.39 | $ | 17.16 | $ | 16.13 | $ | 16.56 | ||||||||||
| Page 11 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| Calculation of Core Return on Average Assets | ||||||||||||||||||||
| Net income | $ | 48,230 | $ | 80,561 | $ | 74,911 | $ | 67,407 | $ | 52,955 | ||||||||||
| Net non-core items, net of taxes, adjustment | 11,256 | (1,211 | ) | 524 | (3,412 | ) | 9,022 | |||||||||||||
| Core earnings | $ | 59,486 | $ | 79,350 | $ | 75,435 | $ | 63,995 | $ | 61,977 | ||||||||||
| Average total assets | $ | 24,698,022 | $ | 23,255,541 | $ | 23,257,921 | $ | 22,738,821 | $ | 21,852,094 | ||||||||||
| Return on average assets | 0.77 | % | 1.37 | % | 1.29 | % | 1.20 | % | 0.96 | % | ||||||||||
| Core return on average assets | 0.96 | % | 1.35 | % | 1.30 | % | 1.14 | % | 1.13 | % | ||||||||||
| Calculation of Return on Tangible Common Equity | ||||||||||||||||||||
| Net income | $ | 48,230 | $ | 80,561 | $ | 74,911 | $ | 67,407 | $ | 52,955 | ||||||||||
| Amortization of intangibles, net of taxes | 2,575 | 2,460 | 2,462 | 2,470 | 2,475 | |||||||||||||||
| Total income available to common stockholders | $ | 50,805 | $ | 83,021 | $ | 77,373 | $ | 69,877 | $ | 55,430 | ||||||||||
| Net non-core items, net of taxes | 11,256 | (1,211 | ) | 524 | (3,412 | ) | 9,022 | |||||||||||||
| Core earnings | 59,486 | 79,350 | 75,435 | 63,995 | 61,977 | |||||||||||||||
| Amortization of intangibles, net of taxes | 2,575 | 2,460 | 2,462 | 2,470 | 2,475 | |||||||||||||||
| Total core income available to common stockholders | $ | 62,061 | $ | 81,810 | $ | 77,897 | $ | 66,465 | $ | 64,452 | ||||||||||
| Average common stockholders' equity | $ | 3,261,627 | $ | 3,067,205 | $ | 2,980,609 | $ | 2,972,689 | $ | 2,955,865 | ||||||||||
| Average intangible assets: | ||||||||||||||||||||
| Goodwill | (1,137,441 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | ||||||||||
| Other intangibles | (105,155 | ) | (102,576 | ) | (105,785 | ) | (109,850 | ) | (113,098 | ) | ||||||||||
| Total average intangibles | (1,242,596 | ) | (1,177,881 | ) | (1,181,090 | ) | (1,185,155 | ) | (1,188,403 | ) | ||||||||||
| Average tangible common stockholders' equity | $ | 2,019,031 | $ | 1,889,324 | $ | 1,799,519 | $ | 1,787,534 | $ | 1,767,462 | ||||||||||
| Return on average common equity | 5.87 | % | 10.42 | % | 10.08 | % | 9.20 | % | 7.13 | % | ||||||||||
| Return on tangible common equity | 9.98 | % | 17.43 | % | 17.25 | % | 15.85 | % | 12.48 | % | ||||||||||
| Core return on average common equity | 7.24 | % | 10.26 | % | 10.15 | % | 8.73 | % | 8.34 | % | ||||||||||
| Core return on tangible common equity | 12.19 | % | 17.18 | % | 17.36 | % | 15.08 | % | 14.51 | % | ||||||||||
| Calculation of Efficiency Ratio (1) | ||||||||||||||||||||
| Non-interest expense | $ | 141,597 | $ | 114,333 | $ | 114,657 | $ | 113,002 | $ | 125,840 | ||||||||||
| Non-core non-interest expense adjustment | (15,241 | ) | 1,879 | (1,154 | ) | (858 | ) | (12,489 | ) | |||||||||||
| Other real estate and foreclosure expense adjustment | (576 | ) | (339 | ) | (863 | ) | (343 | ) | (545 | ) | ||||||||||
| Amortization of intangibles adjustment | (3,486 | ) | (3,331 | ) | (3,333 | ) | (3,344 | ) | (3,351 | ) | ||||||||||
| Efficiency ratio numerator | $ | 122,294 | $ | 112,542 | $ | 109,307 | $ | 108,457 | $ | 109,455 | ||||||||||
| Net-interest income | $ | 153,081 | $ | 145,237 | $ | 146,533 | $ | 146,681 | $ | 154,960 | ||||||||||
| Non-interest income | 46,601 | 48,550 | 47,115 | 49,549 | 41,761 | |||||||||||||||
| Non-core non-interest income adjustment | (2 | ) | 239 | (445 | ) | (5,477 | ) | (275 | ) | |||||||||||
| Fully tax-equivalent adjustment (effective tax rate of 26.135%) | 5,579 | 4,941 | 4,548 | 4,163 | 3,482 | |||||||||||||||
| Loss (gain) on sale of securities | 348 | (5,248 | ) | (5,127 | ) | (5,471 | ) | (16 | ) | |||||||||||
| Efficiency ratio denominator | $ | 205,607 | $ | 193,719 | $ | 192,624 | $ | 189,445 | $ | 199,912 | ||||||||||
| Efficiency ratio (1) | 59.48 | % | 58.10 | % | 56.75 | % | 57.25 | % | 54.75 | % | ||||||||||
(1) Efficiency ratio is core non-interest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and non-interest revenues, excluding gains and losses from securities transactions and non-core items.
| Page 12 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date (continued) | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| Calculation of Adjusted Pre-Tax, Pre-Provision (PTPP) Earnings | ||||||||||||||||||||
| Net income available to common stockholders | $ | 48,230 | $ | 80,561 | $ | 74,911 | $ | 67,407 | $ | 52,955 | ||||||||||
| Provision for income taxes | 11,155 | 18,770 | 17,018 | 14,363 | 10,970 | |||||||||||||||
| Provision for credit losses (including provision for unfunded commitments) | (1,308 | ) | (19,890 | ) | (12,951 | ) | 1,445 | 6,943 | ||||||||||||
| Loss (gain) on sale of securities | 348 | (5,248 | ) | (5,127 | ) | (5,471 | ) | (16 | ) | |||||||||||
| Net pre-tax non-core items | 15,239 | (1,640 | ) | 709 | (4,619 | ) | 12,214 | |||||||||||||
| Adjusted Pre-tax, pre-provision (PTPP) earnings | $ | 73,664 | $ | 72,553 | $ | 74,560 | $ | 73,125 | $ | 83,066 | ||||||||||
| Page 13 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - Year-to-Date | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| Calculation of Core Return on Average Assets | ||||||||||||||||||||
| Net income | $ | 271,109 | $ | 222,879 | $ | 142,318 | $ | 67,407 | $ | 254,852 | ||||||||||
| Net non-core items, net of taxes, adjustment | 7,157 | (4,099 | ) | (2,888 | ) | (3,412 | ) | 9,448 | ||||||||||||
| Core earnings | $ | 278,266 | $ | 218,780 | $ | 139,430 | $ | 63,995 | $ | 264,300 | ||||||||||
| Average total assets | $ | 23,492,308 | $ | 23,085,987 | $ | 22,999,805 | $ | 22,738,821 | $ | 21,590,745 | ||||||||||
| Return on average assets | 1.15 | % | 1.29 | % | 1.25 | % | 1.20 | % | 1.18 | % | ||||||||||
| Core return on average assets | 1.18 | % | 1.27 | % | 1.22 | % | 1.14 | % | 1.22 | % | ||||||||||
| Calculation of Return on Tangible Common Equity | ||||||||||||||||||||
| Net income | $ | 271,109 | $ | 222,879 | $ | 142,318 | $ | 67,407 | $ | 254,852 | ||||||||||
| Amortization of intangibles, net of taxes | 9,967 | 7,392 | 4,932 | 2,470 | 9,968 | |||||||||||||||
| Total income available to common stockholders | $ | 281,076 | $ | 230,271 | $ | 147,250 | $ | 69,877 | $ | 264,820 | ||||||||||
| Net non-core items, net of taxes | 7,157 | (4,099 | ) | (2,888 | ) | (3,412 | ) | 9,448 | ||||||||||||
| Core earnings | 278,266 | 218,780 | 139,430 | 63,995 | 264,300 | |||||||||||||||
| Amortization of intangibles, net of taxes | 9,967 | 7,392 | 4,932 | 2,470 | 9,968 | |||||||||||||||
| Total core income available to common stockholders | $ | 288,233 | $ | 226,172 | $ | 144,362 | $ | 66,465 | $ | 274,268 | ||||||||||
| Average common stockholders' equity | $ | 3,071,313 | $ | 3,007,181 | $ | 2,976,671 | $ | 2,972,689 | $ | 2,921,039 | ||||||||||
| Average intangible assets: | ||||||||||||||||||||
| Goodwill | (1,090,967 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,075,305 | ) | (1,065,190 | ) | ||||||||||
| Other intangibles | (105,820 | ) | (106,043 | ) | (107,806 | ) | (109,850 | ) | (118,812 | ) | ||||||||||
| Total average intangibles | (1,196,787 | ) | (1,181,348 | ) | (1,183,111 | ) | (1,185,155 | ) | (1,184,002 | ) | ||||||||||
| Average tangible common stockholders' equity | $ | 1,874,526 | $ | 1,825,833 | $ | 1,793,560 | $ | 1,787,534 | $ | 1,737,037 | ||||||||||
| Return on average common equity | 8.83 | % | 9.91 | % | 9.64 | % | 9.20 | % | 8.72 | % | ||||||||||
| Return on tangible common equity | 14.99 | % | 16.86 | % | 16.56 | % | 15.85 | % | 15.25 | % | ||||||||||
| Core return on average common equity | 9.06 | % | 9.73 | % | 9.45 | % | 8.73 | % | 9.05 | % | ||||||||||
| Core return on tangible common equity | 15.38 | % | 16.56 | % | 16.23 | % | 15.08 | % | 15.79 | % | ||||||||||
| Calculation of Efficiency Ratio (1) | ||||||||||||||||||||
| Non-interest expense | $ | 483,589 | $ | 341,992 | $ | 227,659 | $ | 113,002 | $ | 484,736 | ||||||||||
| Non-core non-interest expense adjustment | (15,374 | ) | (133 | ) | (2,012 | ) | (858 | ) | (21,529 | ) | ||||||||||
| Other real estate and foreclosure expense adjustment | (2,121 | ) | (1,545 | ) | (1,206 | ) | (343 | ) | (1,706 | ) | ||||||||||
| Amortization of intangibles adjustment | (13,494 | ) | (10,008 | ) | (6,677 | ) | (3,344 | ) | (13,495 | ) | ||||||||||
| Efficiency ratio numerator | $ | 452,600 | $ | 330,306 | $ | 217,764 | $ | 108,457 | $ | 448,006 | ||||||||||
| Net-interest income | $ | 591,532 | $ | 438,451 | $ | 293,214 | $ | 146,681 | $ | 639,734 | ||||||||||
| Non-interest income | 191,815 | 145,214 | 96,664 | 49,549 | 239,769 | |||||||||||||||
| Non-core non-interest income adjustment | (5,685 | ) | (5,683 | ) | (5,922 | ) | (5,477 | ) | (8,738 | ) | ||||||||||
| Fully tax-equivalent adjustment (effective tax rate of 26.135%) | 19,231 | 13,652 | 8,711 | 4,163 | 11,001 | |||||||||||||||
| Gain on sale of securities | (15,498 | ) | (15,846 | ) | (10,598 | ) | (5,471 | ) | (54,806 | ) | ||||||||||
| Efficiency ratio denominator | $ | 781,395 | $ | 575,788 | $ | 382,069 | $ | 189,445 | $ | 826,960 | ||||||||||
| Efficiency ratio (1) | 57.92 | % | 57.37 | % | 57.00 | % | 57.25 | % | 54.18 | % | ||||||||||
(1) Efficiency ratio is core non-interest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and non-interest revenues, excluding gains and losses from securities transactions and non-core items.
| Page 14 |
| Simmons First National Corporation | SFNC | |||||||||||||||||||
| Reconciliation Of Non-GAAP Financial Measures - Year-to-Date (continued) | ||||||||||||||||||||
| For the Quarters Ended | Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | |||||||||||||||
| (Unaudited) | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| ($ in thousands) | ||||||||||||||||||||
| Calculation of Adjusted Pre-Tax, Pre-Provision (PTPP) Earnings | ||||||||||||||||||||
| Net income available to common stockholders | $ | 271,109 | $ | 222,879 | $ | 142,318 | $ | 67,407 | $ | 254,852 | ||||||||||
| Provision for income taxes | 61,306 | 50,151 | 31,381 | 14,363 | 64,890 | |||||||||||||||
| Provision for credit losses (including provision for unfunded commitments) | (32,704 | ) | (31,396 | ) | (11,506 | ) | 1,445 | 74,973 | ||||||||||||
| Gain on sale of securities | (15,498 | ) | (15,846 | ) | (10,598 | ) | (5,471 | ) | (54,806 | ) | ||||||||||
| Net pre-tax non-core items | 9,689 | (5,550 | ) | (3,910 | ) | (4,619 | ) | 12,791 | ||||||||||||
| Adjusted Pre-tax, pre-provision (PTPP) earnings | $ | 293,902 | $ | 220,238 | $ | 147,685 | $ | 73,125 | $ | 352,700 | ||||||||||
Page 15
Exhibit 99.2
Contents 4 Q4 &2021 Highlights 5 Q4 Results Overview 13 Loans 18 Deposits, Liquidity, Securities, Interest Rate Sensitivity & Capital 24 Credit Quality 27 Key Takeaways and Management Outlook 30 Appendix 4 th Quarter 2021 Earnings Presentation | NASDAQ: SFNC
2 Forward - Looking Statements and Non - GAAP Financial Measures Forward - Looking Statements . Certain statements by Simmons First National Corporation (the “Company”, which where appropriate includes the Company’s wholly - owned banking subsidiary, Simmons Bank) contained in this presentation may not be based on historical facts and should be considered "forward - looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 . These forward - looking statements may be identified by reference to a future period(s) or by the use of forward - looking terminology, such as "anticipate," "estimate," "expect," "foresee,“ “project,” "may," "might," "will," "would," "could,“ “likely” or "intend," future or conditional verb tenses, and variations or negatives of such terms . These forward - looking statements include, without limitation, those relating to the Company’s future growth ; revenue ; expenses (including interest expense and non - interest expenses) ; assets ; loan demand ; asset quality ; profitability ; earnings ; critical accounting policies ; accretion ; net interest margin ; noninterest revenue ; market conditions related to and impact of the Company's common stock repurchase program ; adequacy of the allowance for loan losses ; income tax deductions ; credit quality ; level of credit losses from lending commitments ; net interest revenue ; interest rate sensitivity (including, among other things, the potential impact of rising rates) ; loan loss experience ; liquidity ; capital resources ; market risk ; the expected benefits, milestones, timelines, and costs (and the anticipated realization of expected cost savings) associated with the Company’s merger and acquisition strategy and activity ; the Company’s ability to recruit and retain key employees ; the ability of the Company to manage the impacts of the COVID - 19 pandemic ; the impacts of the Company’s and its customers participation in the Paycheck Protection Program (“PPP”) ; increases in the Company’s security portfolio ; legal and regulatory limitations and compliance and competition ; anticipated loan principal reductions ; fees associated with the PPP ; plans for investments in securities ; statements on the slides titled “Key Takeaways” and “Management Outlook” ; the charges, gains, and savings associated with completed and future branch closures and branch sales ; and projected dividends . Readers are cautioned not to place undue reliance on the forward - looking statements contained in this presentation in that actual results could differ materially from those indicated in or implied by such forward - looking statements, due to a variety of factors . These factors include, but are not limited to, changes in the Company's operating or expansion strategy ; the availability of and costs associated with obtaining adequate and timely sources of liquidity ; the ability to maintain credit quality ; the effect of steps the Company takes in response to the COVID - 19 pandemic ; the severity and duration of the pandemic, including the effectiveness of “booster” vaccination efforts and developments with respect to COVID - 19 variants ; the pace of recovery when the pandemic subsides and the heightened impact it has on many of the risks described herein ; the effects of the pandemic on, among other things, the Company’s operations, liquidity, and credit quality ; general market and economic conditions ; unemployment ; possible adverse rulings, judgments, settlements and other outcomes of pending or future litigation ; the ability of the Company to collect amounts due under loan agreements ; changes in consumer preferences and loan demand ; effectiveness of the Company's interest rate risk management strategies ; laws and regulations affecting financial institutions in general or relating to taxes ; the effect of pending or future legislation ; the ability of the Company to repurchase its common stock on favorable terms ; the ability of the Company to successfully manage and implement its acquisition and branch strategy and integrate acquired institutions ; the ability to obtain regulatory approvals and meet other closing conditions to the proposed merger of Spirit of Texas Bancshares, Inc . (“Spirit”) with and into the Company (“Proposed Transaction”) ; delay in closing the Proposed Transaction ; difficulties and delays in integrating the acquired business or fully realizing cost savings and other benefits of the Proposed Transaction ; changes in interest rates, deposit flows, real estate values, and capital markets ; inflation ; customer acceptance of the Company's products and services ; changes or disruptions in technology and IT systems (including cyber threats, attacks and events) ; changes in accounting principles relating to loan loss recognition (current expected credit losses, or CECL) ; the benefits associated with the Company’s early retirement program and branch closures and sales ; and other risk factors . Other relevant risk factors may be detailed from time to time in the Company's press releases and filings with the U . S . Securities and Exchange Commission, including, without limitation, the Company’s Form 10 - K for the year ended December 31 , 2020 . Any forward - looking statement speaks only as of the date of this presentation, and the Company undertakes no obligation to update these forward - looking statements to reflect events or circumstances that occur after the date of this presentation . Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results . Non - GAAP Financial Measures . This presentation contains financial information determined by methods other than in accordance with U . S . generally accepted accounting principles (GAAP) . The Company's management uses these non - GAAP financial measures in their analysis of the Company's performance . These measures adjust GAAP performance measures to, among other things, include the tax benefit associated with revenue items that are tax - exempt, as well as exclude from income available to common shareholders, non - interest income, and non - interest expense certain income and expenses related to significant non - core activities, such as merger - related expenses, expenses related to the Company’s early retirement program, gain on sale of branches, and net branch right - sizing expenses . In addition, the Company also presents certain figures based on tangible common stockholders’ equity, tangible assets, and tangible book value, which exclude goodwill and other intangible assets . The Company further presents certain figures that are exclusive of the impact of PPP loans, as well as normalized core non - interest expense . The Company’s management believes that these non - GAAP financial measure are useful to investors because they, among other things, present the results of the Company’s ongoing operations without the effect of mergers or other items not central to the Company’s ongoing business, as well as normalize for tax effects . Management, therefore, believes presentations of these non - GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company's core businesses, and management uses these non - GAAP measures to assess the performance of the Company’s core businesses as related to prior financial periods . These non - GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non - GAAP performance measures that may be presented by other companies . Where non - GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the appendix to this presentation .
3 Important Additional Information and Where to Find It This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval with respect to the Proposed Transaction . No offer of securities shall be made except by means of a prospectus meeting the requirements of the Securities Act of 1933 , as amended, and no offer to sell or solicitation of an offer to buy shall be made in any jurisdiction in which such offer, solicitation or sale would be unlawful . In connection with the Proposed Transaction, the Company has filed with the SEC a registration statement on Form S - 4 (the “Registration Statement”) to register the shares of Company common stock that will be issued to Spirit shareholders in the Proposed Transaction . The Registration Statement includes a proxy statement of Spirit and a prospectus of the Company (the “Proxy Statement/Prospectus”), and the Company and/or Spirit may file with the SEC other relevant documents concerning the Proposed Transaction . The definitive Proxy Statement/Prospectus is being mailed to shareholders of Spirit . SHAREHOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION CAREFULLY AND IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BY THE COMPANY AND/OR SPIRIT, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION . Free copies of the Proxy Statement/Prospectus, as well as other filings containing information about the Company and Spirit, may be obtained at the SEC’s Internet site (http : //www . sec . gov), when they are filed by the Company or Spirit . You will also be able to obtain these documents, when they are filed, free of charge, from the Company at simmonsbank . com under the heading “Investor Relations” or from Spirit at www . sotb . com under the “Investor Relations” link . Copies of the Proxy Statement/Prospectus can also be obtained, free of charge, by directing a request to the Company at Simmons First National Corporation, 501 Main Street, Pine Bluff, Arkansas 71601 , Attention : Ed Bilek, Director of Investor Relations, Email : ed . bilek@simmonsbank . com or ir@simmonsbank . com, Telephone : ( 870 ) 541 - 1000 ; or by directing a request to Spirit at Spirit of Texas Bancshares, Inc . , 1836 Spirit of Texas Way, Conroe, Texas 77301 , Attention : Corporate Secretary, Email : jgoleman@sotb . com, Telephone : ( 936 ) 521 - 1836 . Participants in the Solicitation The Company, Spirit, and certain of their respective directors, executive officers and employees may be deemed to be participants in the solicitation of proxies from the shareholders of Spirit in connection with the Proposed Transaction . Information about the Company’s directors and executive officers is available in its proxy statement for its 2021 annual meeting of shareholders, which was filed with the SEC on April 15 , 2021 . Information about Spirit’s directors and executive officers is available in its proxy statement for its 2021 annual meeting of shareholders, which was filed with the SEC on April 9 , 2021 . Information regarding all of the persons who may, under the rules of the SEC, be deemed participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Proxy Statement/Prospectus regarding the Proposed Transaction and other relevant materials to be filed with the SEC when they become available . Free copies of these documents may be obtained as described in the preceding paragraph .
(1) Non - GAAP measures that management believes aids in the discussion of results. See Appendix for Non - GAAP reconciliation (2) Market conditions and our capital needs will drive the decisions regarding additional, future stock repurchases. YoY – year - over - year Note: Book value per share and tangible book value per share figures noted above are as of December 31, 2021 Q4 and 2021 Highlights 4 1 2 3 4 5 Share repurchase program substantially exhausted in Jan - 22 , Board authorizes new share repurchase program ( 2 ) and a 6 percent increase in quarterly dividend New share repurchase plan $ 175 million authorized Book value per share of $ 28 . 82 , up 5 percent YoY Tangible book value ( 1 ) of $ 17 . 71 , up 7 percent YOY Significantly enhancing our position and scale in Texas with the pending acquisition of Spirit of Texas Bancshares, Inc . Expected closing, conversion and integration in 2022 Green shoots in loan demand evidenced by widespread growth across the footprint, coupled with activity in new business units Includes the results of Landmark Community Bank and Triumph Bancshares, Inc . acquisitions (closed on 10 / 8 / 21 ) Q 4 21 EPS of $0.42 Core EPS (1) of $0.52 Newly funded loans of $2.6B in Q4 21 Commercial loan pipeline + 56 % vs Sept - 21 up 5 th consecutive quarter Regulatory filings S - 4 filed on 12/22/21 S - 4/A filed on 1/18/22 S - 4 effectiveness order 1/21/22 FRB filing on 12/29/21 Strong capital position and ability to organically generate capital allows the return of excess capital to shareholders Dividends paid in 2021 $ 78 . 8 million Shares repurchased in 2021 $ 132 . 5 million Full - year 2021 EPS of $2.46 up 6% vs 2020
Q4 21 Results Overview 5
6 ESG: Multi - university sponsorship designed to support female… … student - athletes and serve as an incubator program for developing women leaders in the corporate world
7 M&A : Significantly enhancing our position and scale in the Lone Star… Source: S&P Global Market Intelligence (1) Data at June 30, 2020 and 2021 based on FDIC Summary of Deposit data (2) Combined deposit data at June 30, 2021 includes Simmons Bank, Landmark Community Bank, Triumph Bank and Spirit of Texas Ban k SSB. Does not include mark - to - market accounting adjustments … State with the proposed acquisition of Spirit of Texas Bancshares, Inc. Frankfort Oklahoma City Dallas Austin Wichita Jefferson City Kansas City Mobile Birmingham Louisville Topeka Chicago Montgomery El Paso New Orleans St. Louis Knoxville Chattanooga Springfield Jackson OK AR TX TN IL MO LA KS AL KY MS Nashville Memphis Tulsa Little Rock San Antonio Houston Pro Forma Franchise Arkansas 35.6% Kansas 1.8% Missouri 21.9% Tennessee 13.7% Oklahoma 13.1% Texas 12.6% Illinois 1.3% 2020 (1) Simmons Bank Deposits Arkansas 30.1% Kansas 1.5% Missouri 18.0% Tennessee 19.0% Oklahoma 10.2% Texas 21.2% 2021 (1)(2) Combined Deposits Significantly Enhanced Growth Profile (1) SFNC SFNC+Landmark+Triumph SFNC+Landmark+Triumph+STXB 2.66% 3.13% 2.56% National Average = 2.91% Projected Population Growth (’21 – ’26)
Summary Income Statement FY $ in millions, except per share data Q4 21 Q3 21 Q4 20 Q3 21 Q4 20 2021 Interest income $170.7 $163.9 $179.1 4 % (5) % $ 671.1 (12) % Interest expense 17.7 18.7 24.1 (6) (27) 79.5 (34) Net interest income 153.1 145.2 155.0 5 (1) 591.5 (8) Noninterest income (1) 46.9 43.3 41.7 8 12 176.3 (5) Noninterest expense (1) 141.6 114.3 125.8 - 13 483.6 - Pre-tax, pre-provision income 58.4 74.2 70.9 (21) (18) 284.3 (16) Gain (loss) on sale of securities (0.3) 5.2 - (107) NM 15.5 (72) Provision for (recapture of) credit losses (1.3) (19.9) 6.9 NM NM (32.7) NM Provision for income taxes 11.2 18.8 11.0 (41) 2 61.3 (6) Net income $ 48.2 $ 80.6 $ 53.0 (40) % (9)% $271.2 6 % Diluted EPS $ 0.42 $ 0.74 $ 0.49 (43) % (14)% $2.46 6 % Pre-tax, pre-provision income $ 58.4 $ 74.2 $ 70.9 $284.3 Non-core items: Merger related costs 13.6 1.4 0.7 15.9 Branch right sizing, net 1.6 (3.0) 11.7 (0.9) Gain on sale of branches - - (0.3) (5.3) Early retirement program - - 0.1 - Pre-tax, pre-provision income (adjusted) (3) $ 73.7 $ 72.6 $ 83.1 2 % (11)% $293.9 (17) % Net income (core) (2) $ 59.5 $ 79.4 $ 62.0 (25) % (4)% $278.3 5 % Diluted EPS (core) (2) $ 0.52 $ 0.73 $ 0.57 (29) % (9)% $ 2.53 5 % % Change vs YoY % Change NM – not meaningful Note: Columns may not foot due to rounding FY – fiscal year YoY – year - over - year (1) During 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest in com e under the caption debit and credit card fees. Prior periods have been adjusted to reflect this reclassification (2) Non - GAAP measures that management believes aids in the discussion of results. See appendix for Non - GAAP reconciliation (3) Non - GAAP measurement. Reconciliation included within the slide 8 Q4 21 Financial Highlights
$158.4 $150.8 $151.1 $150.2 $158.7 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 PPP = Paycheck Protection Program Net Interest Income and Margin 9 Net Interest Income $ in millions; Fully Taxable Equivalent Net Interest Income Evolution $ in millions; Fully Taxable Equivalent Q3 21 Δ in PPP Contribution Δ in Accretion Contribution Δ in Interest Income (FTE) ex PPP & Accretion Δ in Interest Expense Q4 21 Net Interest Margin Fully taxable equivalent (%) Loan & Deposits Yield/Rates Fully taxable equivalent (%) 3.22 2.99 2.89 2.85 2.86 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 4.74 4.75 4.73 4.76 4.58 0.34 0.30 0.24 0.20 0.17 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Loan Yield Cost of Deposits +0.1% +1 bp Managed historically low interest rate environment and corresponding impact on loan yields by proactively managing deposit costs
FY YoY $ in millions Q4 21 Q3 21 Q4 20 Q3 21 Q4 20 2021 % Change Service charges on deposit accounts $11.9 $ 11.6 $ 10.8 3 % 10 % $ 43.2 - % Wealth management fees 8.0 7.9 7.2 2 11 31.2 3 Debit and credit card fees (1) 7.5 7.1 6.4 5 16 28.2 14 Mortgage lending income 5.0 5.8 3.0 (13) 68 21.8 (37) Bank owned life insurance 2.8 2.6 1.5 8 87 8.9 53 Other service charges and fees 1.8 2.0 1.8 (10) (1) 7.7 16 Settlement award 3.1 - - NM - 3.1 NM Other 6.8 6.4 11.0 7 (38) 32.2 (19) Gain (loss) on sale of securities (0.3) 5.2 0.0 NM NM 15.5 (72) Total noninterest income $46.6 $48.6 $41.8 (4) % 12 % $191.8 (20) % Core noninterest income (2) $46.6 $48.8 $41.5 (4) % 12 % 186.1 (19) % % Change vs $14.8 $17.6 $16.9 $17.7 $16.2 $14.7 $13.8 $15.1 $15.8 $16.3 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Noninterest Income per Employee Noninterest Income per Employee(2) $69.6 $69.7 $69.6 $70.7 $69.4 $69.5 $65.8 $67.7 $68.8 $69.5 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Revenue per Employee Adjusted Revenue per Employee $ in thousands 21.2% 25.3% 24.3% 25.1% 23.3% 21.1% 20.9% 22.3% 23.0% 23.5% Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Noninterest Income/Total Revenue Adjusted Noninterest Income /Total Revenue(2) Noninterest Income to Total Revenue (2) (ex securities and branch sale gains) (1) During 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest in com e under the caption debit and credit card fees. Prior periods have been adjusted to reflect this reclassification (2) Non - GAAP measure that management believes aids in the discussion of results. See Appendix for Non - GAAP reconciliation FTE – full - time equivalent NM – not meaningful FY – fiscal year YoY – year - over - year 10 Noninterest Income $ in thousands Revenue Per Employee (FTE) (2) (ex securities and branch sale gains) Noninterest Income Per Employee (FTE) (2) (ex securities and branch sale gains)
FY YoY $ in millions Q4 21 Q3 21 Q4 20 Q3 21 Q4 20 2021 % Change Salaries and employee benefits $63.8 $61.9 $55.8 3 % 14 % 246.3 2 % Occupancy expense, net 11.0 9.4 9.2 18 20 38.8 3 Furniture and equipment 4.7 4.9 5.9 (4) (21) 19.9 (17) Deposit insurance 2.1 1.9 1.6 13 30 7.0 (24) OREO and foreclosure expense 0.6 0.3 0.6 70 5 2.1 21 Contribution to Simmons First Foundation 2.5 - 3.0 NM (17) 2.5 NM Other (1) 43.2 34.6 52.0 25 (17) 153.6 (7) Merger related costs 13.6 1.4 0.7 NM NM 15.9 251 Total noninterest expense $141.6 $114.3 $128.8 24 % 10 % $486.1 - % Core noninterest expense (2) $126.4 $116.2 $113.4 9 % 11 % 468.2 1 % % Change vs 2.30% 1.99% 1.97% 1.97% 2.29% 2.07% 1.97% 1.95% 2.00% 2.05% Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Noninterest Expense Core Noninterest Expense (2) Noninterest Expense as a Percentage of Total Average Assets (1) During Q221, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest in com e under the caption debit and credit card fees. Prior periods have been restated to reflect this change (2) Non - GAAP measure that management believes aids in the discussion of results. See Appendix for Non - GAAP reconciliation (3 ) Non - GAAP measurement. Reconciliation included within the slide FTE – full - time equivalent NM – not meaningful FY – fiscal year 11 Noninterest Expense: Full - year 2021 expenses held flat vs 2020 Q4 21 includes the addition of Landmark/Triumph expense base – full expense synergies expected to be realized within one year of operation 2,827 2,817 2,783 2,740 2,877 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Employees (FTE) Core Noninterest Expense – Q4 21 Core Noninterest Expense (2) $126.4 Contribution to foundation (2.5) Salary expense for non - retained associates (Landmark/Triumph) (1.0) Normalized (3) $122.9
Digital: Continued growth and launch of first digital origination process Real Time Open to Buy - This option provides customers the ability to make a payment once a day and have instant access to the available credit on th e ir Simmons Bank credit card, including the amount of the payment just made. For example, if a customer makes a $100 payment on the card’s balance, then another $100 can be charged to th e credit card without delay. 4.8 out of 5 star rating on IOS app store 12 2019 2020 2021 Branch Transactions Digital Transactions Customer Transactions by Channel 2020 2021 Mobile Deposit Dollars +28% +23% 46% 53% 58% +68% 2020 2021 Mobile Deposit Transactions +30% COIN CHECKING • Simmons Bank’s first fully digital origination process • Launched to new and existing customers in 2021 o Utilizes information from customer drivers’ license/state ID to populate application o Integrated with state DMVs to confirm authenticity o Does not require a current banking account to fund from o Customers can begin using right away of all consumer checking accounts opened in 2 nd half of 2021 7.2% of customers were under 40 years old 60% 2021: Significant Projects • Credit card payment with Real Time Open to Buy • Launched Zelle ® Person to Person Payments • Enhanced eStatement Enrollment • Alloy Integration (KYC, BSA, CIP) • Marketing Ads in Digital Channels with Deep Links
LOANS 13
Loan Portfolio: Green shoots indicate inflection point in the quarter… 14 (1) Loans acquired in acquisition of Landmark Community Bank (Landmark) and Triumph Bancshares, Inc., (Triumph) net of purc has e accounting adjustments PPP – Paycheck Protection Program Loan Portfolio Waterfall $ in millions Total loans at 9/30/21 Funded loans/ advances PPP Forgiveness Paydowns/ Payoffs & Other Total loans at 12/30/21 … as evidenced by jump in originations and unfunded commitments Landmark/ Triumph loans, net (1) Decrease in Agricultural (seasonality) Decrease in Mortgage Warehouse Planned Run - off in Energy Portfolio $2,051 $2,039 $2,130 $2,254 $2,943 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Unfunded Commitments $ in millions >45% in the month of December Arkansas 22% Other 10% Missouri 18% Tennessee 22% Oklahoma 6% Texas 21% Kansas 1% $12.0B Geographical Composition of Loan Portfolio At December 31, 2021 New producers added in 2021: • 48 commercial and community bankers • 5 business development officers • 6 mortgage loan officers • 4 treasury management officers • 15 wealth management associates
Commercial loan pipeline increases for the 5 th consecutive quarter… 15 (1) Quarterly amounts adjusted for branches sold in South Texas and Colorado during 2020 and Illinois in 2021 * Corporate Banking includes Asset Based Lending, Commercial Finance and Institutional Banking ** Western markets include NW Arkansas, Kansas City, Wichita, Oklahoma City and Tulsa • NA – not applicable as new unit in Q4 21 … driven by growth across the footprint and new business units Commercial Loan Pipeline by Category (1) $ in millions $641 $219 $192 $247 $487 $340 $503 $766 $220 $90 $112 $250 $408 $484 $484 $929 $291 $72 $70 $177 $285 $467 $493 $619 $0 $500 $1,000 $1,500 $2,000 $2,500 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Opportunity Proposal Ready to Close $1,152 $381 $374 $674 $1,180 $1,291 $1,480 $2,314 +52% +56% +92% +26% Rate Ready to Close 4.70% 4.10% 4.37% 4.12% 3.81% 3.77% 3.47% 3.28% Business Unit $ Pipeline Δ vs 3Q21 Select Markets Community Banking $419M +48% +185% MO, OK, TX +64% Arkansas Metro Banking $1.5B +26% +44% Texas +31% Western** +21% Central AR & TN Corporate Banking* $382M NA
Mortgage Loan Volume: Closed and Pipeline 16 $ in millions $126 $224 $243 $181 $183 $319 $408 $399 $326 $274 $242 $291 $77 $92 $86 $51 $145 $239 $307 $214 $166 $120 $97 $108 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Mortgage Closed Loan Volume Mortgage Pipeline Volume Mortgage originations in Q4: 49% purchase, 51% refinance Mortgage Loan Volume – Closed in 2019 $774 Million Mortgage Loan Volume – Closed in 2020 $1.3 Billion Mortgage Loan Volume – Closed in 2021 $1.1 Billion
Breakout: Loan Portfolio by Category 17 as of September 30, 2021 as of December 31, 2021 $ in millions Balance $ % of Total Loans Balance $ % of Total Loans Classified $ Nonperforming $ ACL % Unfunded Commitment $ Unfunded Commitment Reserve Total Loan Portfolio Consumer - Credit Card 176 2% 187 2% 1 1 2.2% - Consumer - Other 182 2% 168 1% 2 1 1.6% 27 Real Estate - Construction 1,230 11% 1,326 11% 9 2 1.4% 1,183 Real Estate - Commercial 5,309 49% 5,739 48% 197 27 2.6% 260 Real Estate - Single - family 1,541 14% 2,102 17% 32 19 0.5% 290 Commercial 1,609 15% 1,873 16% 44 19 0.9% 1,107 Payroll Protection Plan (PPP) 212 2% 117 1% - - - - Mortgage Warehouse 275 2% 230 2% - - 0.2% - Agriculture 217 2% 169 1% - - 0.7% 76 Other 74 1% 102 1% - - 1.4% 2 Total Loan Portfolio 10,825 100% 12,013 100% 285 69 1.71% 2,943 0.8% Loan Concentration : C&D 50% 51% CRE 203% 204% Select Loan Categories (excluding PPP) Retail 1,098 10% 1,161 10% 21 3 3.6% 132 Nursing / Extended Care 387 4% 375 3% 9 - 1.1% 11 Healthcare 404 4% 385 3% 17 7 1.8% 82 Multifamily 582 5% 641 5% 9 - 0.7% 322 Hotel 814 8% 898 7% 115 17 4.1% 35 Restaurant 386 4% 396 3% 5 2 2.0% 10 NOO Office 643 6% 788 7% 2 - 4.2% 59 Energy 128 1% 105 1% 17 3 7.7% 46
DEPOSITS, LIQUIDITY, SECURITIES, INTEREST RATE SENSITIVITY AND CAPITAL 18
Deposits: Continue to effectively manage deposits costs… 19 … while strategically changing the mix and growing our deposit base $ in billions 0.94% 0.80% 0.44% 0.39% 0.34% 0.30% 0.24% 0.20% 0.17% 0.00% 0.10% 0.20% 0.30% 0.40% 0.50% 0.60% 0.70% 0.80% 0.90% 1.00% $0.0 $2.5 $5.0 $7.5 $10.0 $12.5 $15.0 $17.5 $20.0 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Noninterest Bearing Interest Bearing Transactions Time Deposits Cost of Deposits $16.1 $15.6 $16.6 $16.2 $17.0 $18.2 $18.3 $18.1 As a % of Total Deposits Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Noninterest Bearing 23.2% 23.0% 27.7% 27.4% 26.4% 26.9% 26.7% 27.2% 27.5% Interest Bearing Transactions 56.4% 56.8% 54.0% 55.4% 56.9% 56.5% 57.7% 59.2% 59.8% Time Deposits 20.3% 20.2% 18.2% 17.2% 16.7% 16.6% 15.5% 13.6% 12.7% Deposit Mix $19.4 +$2.4 Billion
20 (1) As of December 31, for each respective year shown above and quarter end for each respective quarter shown above (2) FTE – fully taxable equivalent Cash and Cash Equivalents $ in millions Securities Portfolio Summary $ in millions Liquidity: Poised to opportunistically redeploy excess liquidity As of 12/31/21 Par Value Yield (FTE) Effective Duration AFS HTM Fixed Rate MBS $3,003 1.31% 3.80 98% 2% Municipal 2,901 2.67% 7.39 59% 41% Treasury/Agency 495 1.76% 8.18 52% 48% Corporate 407 2.86% 5.74 96% 4% Other 131 1.60% 4.72 100% - Variable Rate 1,495 0.36% 1.09 100% - Total $8,432 1.72% 4.94 82% 18% $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Cash & Cash Equivalents Short-Term Variable Rate Securities $1,052 $1,792 $2,600 $4,103 • Net securities purchases totaling $ 303 million in the quarter Q4 21 Summary • Approximately $ 3 . 1 billion of liquidity including cash and cash equivalents and variable rate securities at 12 / 31 / 21 • Securities portfolio effective duration, net of $ 1 billion matched swap on fixed rate securities, at 4 . 3 at 12 / 31 / 21 , unchanged from 9 / 30 / 21 Loan to Deposit Ratio (1) $710 $585 $2,577 $3,527 $3,606 $3,286 $3,150 95% 90% 76% 67% 62% 60% 62% 2018 2019 2020 Q1 21 Q2 21 Q3 21 Q4 21 Significant capacity to fund loan growth
FTE – fully taxable equivalent Interest Rate Sensitivity Loan Portfolio At December 31, 2021 46% 54% Variable Rate Loans Fixed Rate Loans Fixed vs Variable Rate $12.0B 57% 34% 9% At Floor No Floor Not At Floor Floor Status – Variable Rate Loans 48% 23% 5% 24% Daily Within 3 Mo 4 to 12 Mo Over 12 Mo Rate Reset Date on Variable Rate Loans Balance Sheet Interest Rate Sensitivity Over the next 12 months (estimated) (1.68)% 1.9% 5.2% Down 100 bps Up 100 bps Up 200 bps Scenarios assume a static balance sheet with parallel, sustained shift in the yield curve 21 Fixed - Variable Rate Loan Summary • 43 % of variable rate loan balances are either not at their floor rate or have no rate floor • 48 % of variable rate loan balances have daily rate resets and an additional 23 % have rate resets within 3 months Estimated potential impact of rising rates on variable rate loan portfolio Assumptions - FED raises interest rates 25 bps four times in 2022 (March, June, September and December) Static balance sheet ~$9M increase in variable rate loan interest income in 2022 ~$24M increase in annualized variable rate loan interest income thereafter • Fixed rate loans scheduled maturities : • 18 % in the next 12 months • 25 % in 3 - 5 years : • 33 % in 1 - 3 years • 24 % in 5 + years
9.8% 10.2% 10.9% 13.4% 13.8% 2017 2018 2019 2020 2021 W ELL C APITALIZED 8.0% 9.8% 10.2% 10.9% 13.4% 13.8% 2017 2018 2019 2020 2021 11.4% 13.4% 13.7% 16.8% 16.8% 2017 2018 2019 2020 2021 9.2% 8.8% 9.6% 9.1% 9.1% 2017 2018 2019 2020 2021 (1) As of December 31, for each respective year shown above 22 W ELL C APITALIZED 5.0% Tier 1 Leverage Ratio (1) CET1 Capital Ratio (1) W ELL C APITALIZED 6.5% Tier 1 Risk - Based Capital Ratio (1) Total Risk - Based Capital Ratio (1) W ELL C APITALIZED 10.0% Strong Capital Position: Disciplined capital management process… … has allowed us to effectively manage our risk profile while also well - positioning us to take advantage of future growth opportunities …
$10.1 $93.3 $0.0 $0.0 $20.0 $3.1 $0.0 $51.4 $77.9 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Suspended Plan Precluded due to acquisitions 2.6 million shares repurchased in the quarter $29.69 weighted average price $20.6 million remaining capacity nearly exhausted in Jan - 22 $12.34 $14.18 $15.89 $16.56 $16.13 $17.16 $17.39 $17.71 2017 2018 2019 2020 Q1 21 Q2 21 Q3 21 Q4 21 $22.65 $24.33 $26.30 $27.53 $27.04 $28.03 $28.42 $28.82 2017 2018 2019 2020 Q1 21 Q2 21 Q3 21 Q4 21 (1) As of December 31, for each respective year shown above and quarter end for each respective quarter shown above (2) Non - GAAP measure that management believes aids in the discussion of results. See Appendix for Non - GAAP reconciliation (3) Based on January 19, 2022 closing stock price of $30.66 and 2021 annual dividend per share (4) Market conditions and our capital needs will drive the decisions regarding additional, future stock repurchases. * Represents the estimated annualized cash dividend rate based on the new quarterly cash dividend approved by the board of d ire ctors on the Company’s Class A common stock ($0.19*4). The future payments of dividends is not guaranteed and is subject to var ious factors, including approval by the company’s board of directors … without losing focus on creating long - term shareholder value Book Value Per Common Share (1) +27% Tangible Book Value Per Common Share (1) (2) 44% increase Board authorizes new $175 million share repurchase program and 6% dividend increase $0.20 $0.22 $0.24 $0.27 $0.29 $0.31 $0.34 $0.37 $0.38 $0.38 $0.38 $0.38 $0.40 $0.42 $0.44 $0.46 $0.48 $0.50 $0.60 $0.64 $0.68 $0.72 $0.76 Proven Dividend Record Share Repurchase Program (4) 113 consecutive years 30 - 35% targeted payout ratio 2.4% dividend yield (3) Q4 Share Repurchase Summary 23 +5% +7%
Q4 21 Credit Quality 24
Source: S&P Global Market Intelligence 2016 - 2020 (1) ALLL for 2016 – 2019 and ACL 2020 – 2021 (2) YTD annualized net charge - offs 25 Nonperforming loans / Loans ACL/ALLL (1) / Loans (%) and ACL/ALLL ($) Nonperforming Assets / Assets Credit Quality: Conservative culture and commitment to… … maintaining strong underwriting standards reflected in asset quality metrics 1.68% 0.81% 0.67% 0.65% 0.96% 0.57% 2016 2017 2018 2019 2020 2021 As of December 31, ($ in millions) $36 $42 $57 $68 $238 $205 0.66% 0.39% 0.48% 0.46% 1.85% 1.71% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1.60% 1.80% 2.00% $0 $25 $50 $75 $100 $125 $150 $175 $200 $225 $250 2016 2017 2018 2019 2020 2021 1.45% 0.83% 0.64% 0.55% 0.64% 0.31% 2016 2017 2018 2019 2020 2021 Quarterly Trend 12/31/21 9/30/21 Change NPL / Loans 0.57% 0.55% +2 bps Nonperforming Loans (in millions) $68.6 $59.4 $9.2 NPA / Assets 0.31% 0.31% - Nonperforming Assets (in millions) $76.3 $72.9 $3.4 Past Due 30+ Days / Loans 0.11% 0.09% +2 bps Net Charge - offs (2) / Loans (YTD) 0.13% 0.06% +7 bps NPL Coverage Ratio 300% 341% (41) bps ACL / Loans 1.71% 1.87% (16) bps As of December 31, As of December 31, Note: Figures for 12/31/21 include the impact of Landmark and Triumph acquisitions
ACL = Allowance for Credit Losses on Loans (1) Non - GAAP measure that management believes aids in the discussion of results. See Appendix for Non - GAAP reconciliation 26 Reserve for Unfunded Commitments Allowance for Credit Losses (ACL): Reflective of loan portfolio… … and continued expectation of improvement in Moody’s economic scenarios $ in millions ACL ACL / Loans ACL/ Loans excluding PPP (1) ACL as of 12/31/20 $ 238.0 1.85% 1.98% Q1 21 Provision 0.0 Q1 21 Net charge - offs (2.9) ACL as of 3/31/21 $ 235.1 1.93% 2.06% Q2 21 Recapture of Provision (10.0) Q2 21 Net recoveries 2.1 ACL as of 6/30/21 $ 227.2 2.00% 2.08% Q3 21 Recapture of Provision (19.9) Q3 21 Net Charge - offs (4.8) ACL as of 9/30/21 $ 202.5 1.87% 1.91% Q4 21 Recapture of Provision (1.3) Q4 21 Net Charge - offs (9.3) Day 1 PCD Allowance (Landmark/Triumph) 13.4 ACL as of 12/31/21 $ 205.3 1.71% 1.73% Allowance for Credit Losses on Loans and Loan Coverage $ in millions as of 12/31/20 As of 3/31/21 As of 6/30/21 As of 9/30/21 As of 12/31/21 Unfunded Commitments $2,051 $2,039 $2,130 $2,254 $2,943 Reserve $22.4 $22.4 $22.4 $22.4 $22.4 Reserve / Unfunded Balance 1.1% 1.1% 1.1% 1.0% 0.8% ACL Methodology as of 12/31/21: ▪ Qualitative allocation: 0.89% ▪ Quantitative allocation: 0.82% ▪ Moody’s December 2021 scenarios with management’s weighting: S1 (18%) / Baseline (65%) / S2 (17%) ▪ Total ACL / Loans: 1.71%
Key Takeaways and Management Outlook 27
Key Takeaways 28 1 Encouraged that green shoots in the quarter will further translate into increased loan production leading to growth of overall loan portfolio 2 Returning excess capital to our shareholders through cash dividends and share repurchase program while maintaining a strong capital position to support organic growth and M&A activity 3 Continue to reinvest in our franchise with the addition of revenue producing associates, adding new revenue sources and investing in technology 4 Anticipate closing and seamless conversion and integration of Spirit of Texas Bancshares, Inc. while enhancing the capacity to grow our customer base
Management Outlook 29 Balance Sheet (Organic) Investment Securities Anticipate balances to be maintained with cash flows reinvested at current rates Loans Expect loan growth to accelerate throughout the year Targeting period - end loan growth in the upper single digits (excluding PPP) Deposits Expect continued strong liquidity levels to drive moderate core deposit growth Somewhat offset by ~$2 billion of maturing/repricing CDs in 2022 ACL Anticipate provision increase related to loan growth to be offset by improving economic modeling and credit metrics Income Statement (Organic) Net Interest Income Improvement expected as balance sheet mix migrates toward loans Somewhat offset by decline in PPP contribution and current low interest rates Opportunity for further improvement with rising interest rates Fee Income Anticipate moderate fee income growth due to continued balance sheet growth and geographic diversification with mortgage revenue in line with industry trends Expenses Goal of maintaining core expenses in the area of 2% of average assets Continued aggressive hiring in production and wage inflation countered by M&A cost savings and added scale Taxes Expect effective tax rate in the high teens, consistent with recent quarters, and potentially trending upwards in the back half of the year as revenue mix shifts Note : Management’s outlook is based on our current estimates and assumptions and speaks only as of the date of this presentation . Our outlook is subject to change based on a variety of factors as noted in our Forward - Looking Statements disclosure on slide 2 of this presentation . The Company undertakes no obligation to update these forward - looking statements to reflect events or circumstances that occur after the date of this presentation . The outlook presented below does not include the impact of the pending acquisition of Spirit of Texas Bancshares, Inc . Spirit of Texas Bancshares, Inc. Expected to close in 2022
APPENDIX 30
(1) Effective tax rate of 26.135% for 2018 - 2021 and 39.225% for 2017, adjusted for non - deductible merger - related costs. 31 Non - GAAP Reconciliations Q4 Q1 Q2 Q3 Q4 YTD YTD $ in thousands 2020 2021 2021 2021 2021 2021 2020 Calculation of Core Earnings Net Income $ 52,968 $ 67,420 $ 74,924 $ 80,574 $ 48,238 $ 271,156 $ 254,904 Non - core items Gain on sale of branches (275) (5,300) (16) - - (5,316) (8,368) Merger related costs 731 233 686 1,401 13,591 15,911 4,531 Early Retirement Program 62 - - - - - 2,901 Branch right sizing 11,696 448 39 (3,041) 1,648 (906) 13,727 Tax Effect⁽¹⁾ (3,192) 1,207 (185) 429 (3,983) (2,532) (3,343) Non - core items, net of tax _ 9,022 _ (3,412) __ __524 (1,211) ____ 11,256 7,157 9,448 Core earnings (non - GAAP) $ 61,990 $ 64,008 $ _75,448 $ _79,363 $ _59,494 $ 278,313 $ 264,352 Calculation of Earnings and Core Earnings per Diluted Share Net Income $ 52,968 $ 67,420 $ 74,924 $ 80,574 $ 48,238 $ 271,156 $ 254,904 Less: Preferred stock dividend 13 13 13 13 8 47 52 Earnings available to common shareholders $ 52,955 $ 67,407 $ _74,911 $ _80,561 $ _48,230 $ 271,109 $ 254,852 Diluted earnings per share $ 0.49 $ 0.62 $ 0.69 $ 0.74 $ 0.42 $ 2.46 $ 2.31 Core earnings (non - GAAP) $ 61,990 $ 64,008 $ 75,448 $ 79,363 $ 59,494 $ 278,313 $ 264,352 Less: Preferred stock dividend 13 13 13 13 8 47 52 Core earnings available to common shareholders (non - GAAP) $ 61,977 $ 63,995 $ _75,435 $ _79,350 $ _59,486 $ 278,266 $ 264,300 Core diluted earnings per share $ 0.57 $ 0.59 $ 0.69 $ 0.73 $ 0.52 $ 2.53 $ 2.40
32 Non - GAAP Reconciliations $ in thousands, except per share and share count 2017 2018 2019 2020 Calculation of Book Value and Tangible Book Value per Share Total common stockholders' equity $ 2,084,564 $ 2,246,434 $ 2,988,157 $ 2,975,889 Intangible assets: Goodwill (842,651) (845,687) (1,055,520) (1,075,305) Other intangible assets (106,071) (91,334) (127,340) (111,110) Total intangibles (948,722) (937,021) (1,182,860) (1,186,415) Tangible common stockholders' equity (non - GAAP) $ 1,135,842 $ 1,309,413 $ 1,805,297 $ 1,789,474 Shares of common stock outstanding 92,029,118 92,347,643 113,628,601 108,077,662 Book value per common share $ 22.65 $ 24.33 $ 26.30 $ 27.53 Tangible book value per common share (non - GAAP) $ 12.34 $ 14.18 $ 15.89 $ 16.56 Q1 Q2 Q3 Q4 $ in thousands, except per share and share count 2021 2021 2021 2021 Calculation of Book Value and Tangible Book Value per Share Total common stockholders' equity $ 2,930,008 $ 3,038,599 $ 3,029,764 $ 3,248,841 Intangible assets: Goodwill (1,075,305) (1,075,305) (1,075,305) (1,146,007) Other intangible assets (107,091) (103,759) (100,428) (106,235) Total intangibles (1,182,396) (1,179,064) (1,175,733) (1,252,242) Tangible common stockholders' equity (non - GAAP) $ 1,747,612 $ 1,859,535 $ 1,854,031 $ 1,996,599 Shares of common stock outstanding 108,345,732 108,386,669 106,603,231 112,715,444 Book value per common share $ 27.04 $ 28.03 $ 28.42 $ 28.82 Tangible book value per common share (non - GAAP) $ 16.13 $ 17.16 $ 17.39 $ 17.71
FTE – full - time equivalent 33 Non - GAAP Reconciliations Q4 Q1 Q2 Q3 Q4 YTD YTD $ in thousands 2020 2021 2021 2021 2021 2021 2020 Calculation of Core Noninterest Income Noninterest Income (GAAP) $ 41,761 $ 49,549 $ 47,115 $ 48,550 $ 46,601 $ 191,815 $ 239,769 Non - core Items (non - GAAP) _(275) ___ (5,477) _(445) 239 (2) (5,685) (8,738) Core Noninterest Income (non - GAAP) $ 41,486 $ 44,072 $ 46,670 $ 48,789 $ 46,599 $ 186,130 $ 231,031 Calculation of Core Noninterest Expense Noninterest Expense (GAAP) $ 125,840 $ 113,002 $ 114,657 $ 114,333 $ 141,597 $ 483,589 $ 484,736 Non - core Items (non - GAAP) _(12,489) __ _ (858) _(1,154) 1,879 (15,241) (15,374) (21,529) Core Noninterest Expense (non - GAAP) $ 113,351 $ 112,144 $ 113,503 $ 116,212 $ 126,356 $ 468,215 $ 463,207 Calculation of Noninterest Expense to Average Assets Average total assets $ 21,852,094 $ 22,738,821 $ 23,257,921 $ 23,255,541 $ 24,698,022 Noninterest expense to average total assets 2.30% 1.99% 1.97% 1.97% 2.29% Core noninterest expense to average assets (non - GAAP) 2.07% 1.97% 1.95% 2.00% 2.05% Calculation of Total Revenue per Employee (FTE) Net Interest Income (GAAP) $ 154,960 $ 146,681 $ 146,533 $ 145,237 $ 153,081 Noninterest Income (GAAP) 41,761 __ 49,549 47,115 48,550 46,601 Total Revenue $ 196,721 $ 196,230 $ 193,648 $ 193,787 $ 199,682 Total Revenue $ 196,721 $ 196,230 $ 193,648 $ 193,787 $ 199,682 Less gain (loss) on sales of securities 16 5,471 5,127 5,248 (348) Less gain on sale of branches 275 5,300 16 - - Total Revenue - adjusted $ 196,430 $ 185,459 $ 188,505 $ 188,539 $ 200,030 Employees (FTE) 2,827 2,817 2,783 2,740 2,877 Total Revenue per Employee (FTE) $ 69.59 $ 69.66 $ 69.58 $ 70.73 $ 69.41 Total Revenue adjusted per Employee (FTE) $ 69.48 $ 65.84 $ 67.73 $ 68.81 $ 69.53
Non - GAAP Reconciliations 34 Q4 Q1 Q2 Q3 Q4 $ in thousands 2020 2021 2021 2021 2021 Calculation of Allowance for Credit Losses to Total Loans Allowance for credit losses (GAAP) $ 238,050 $ 235,116 $ 227,239 $ 202,508 $ 205,332 Total loans (GAAP) $ 12,900,897 $ 12,195,873 $ 11,386,352 $ 10,825,227 $ 12,012,503 PPP loans (904,673) (797,629) (441,353) (212,087) (116,659) Total loans excluding PPP loans (Non - GAAP) $ 11,996,224 $ 11,398,244 $ 10,944,999 $ 10,613,140 $ 11,895,844 Allowance for credit losses to total loans 1.85% 1.93% 2.00% 1.87% 1.71% Allowance for credit losses to total loans excluding PPP (non - GAAP) 1.98% 2.06% 2.08% 1.91% 1.73% Q4 Q1 Q2 Q3 Q4 $ in thousands 2020 2021 2021 2021 2021 Calculation of Noninterest Income to Total Revenue Total Noninterest Income $ 41,761 $ 49,549 $ 47,115 $ 48,550 $ 46,601 Less gain (loss) on sales of securities 16 5,471 5,127 5,248 (348) Less gain on sale of branches 275 5,300 16 - - Total Noninterest Income - adjusted $ 41,470 $ 38,778 $ 41,972 $ 43,302 $ 46,949 Noninterest Income to Total Revenue 21.23% 25.25% 24.33% 25.05% 23.34% Noninterest Income (adjusted) to Total Revenue (adjusted) 21.11% 20.91% 22.27% 22.97% 23.47% Noninterest Income per Employee $ 14.77 $ 17.59 $ 16.93 $ 17.72 $ 16.20 Noninterest Income (adjusted) per Employee (FTE) $ 14.67 $ 13.77 $ 15.08 $ 15.80 $ 16.32
Contents 4 Q4 & 2021 Highlights 5 Q4 Results Overview 13 Loans 18 Deposits, Liquidity, Securities, Interest Rate Sensitivity & Capital 24 Credit Quality 27 Key Takeaways and Management Outlook 30 Appendix 4 th Quarter 2021 Earnings Presentation | NASDAQ: SFNC