Third Quarter 2023
Highlights
- Core net income up from prior quarter
- Net interest margin increased one basis point to 2.73% from
prior quarter
- Deposit growth of $71 million (up 4.1% annualized),
including $92 million for core customer deposits excluding brokered
(up 5.6% annualized)
- Expenses down 14.5%, or 6.8% excluding transaction costs,
and core efficiency ratio improved by 96 basis points from prior
quarter
- Loan delinquencies down 9.5% from prior quarter and two
consecutive quarters of net recoveries
- Regulatory capital ratios improve by 23 basis points from
prior quarter including common equity tier 1 (“CET1”) ratio up to
11.08%
- Declared dividend of $0.31 per share, up 3.3% from prior
year comparable period
- Launched new digital banking platform to improve clients’
banking experience in October
Premier Financial Corp. (Nasdaq: PFC) (“Premier” or the
“Company”) announced today 2023 third quarter results, including
net income of $24.7 million ($0.69 per diluted common share)
compared to $48.4 million ($1.35 per diluted common share), or core
$24.2 million ($0.68 per diluted common share) excluding the
insurance agency sale, for the second quarter of 2023.
“I am pleased to announce Premier’s continued improvement in net
income, net interest income, and net interest margin performance
for the third quarter,” said Gary Small, President and CEO of
Premier. “Average annualized loan growth for the quarter totaled
2.9%, consistent with our focus on serving existing client needs
while remaining very selective in the pursuit of new relationships.
Continued success in attracting customer deposits (up 5.6%
annualized for the quarter) will translate into higher loan growth
as we enter 2024.”
“Premier’s credit metrics remain steady with delinquencies down
as our consumer and commercial clients continue to manage their
resources well. Commercial line usage is drifting lower each month
as clients utilize their excess cash to reduce line balances. The
business outlook across our markets remains strong, yet
conservative. Warehouse vacancy is low and manufacturing order
boards remain robust, with labor availability as the major
constraint. Many companies are focusing on profit margins versus
growth as they work through the uncertain economic environment. The
housing market remains very tight in most markets with continuing
new job creation, a consistent theme across the network. The
Federal Reserve’s more paced approach toward interest rates in
recent months has allowed the bank, and our clients, time to
address the impacts of the higher rate environment,” added
Small.
“We at Premier will continue to build capital and make
investments designed to improve our business, our client
experience, and benefit the communities we serve,” Small continued.
“To that end, all of us at Premier are very excited to have just
concluded a major initiative focused on improving our client
experience. We’ve recently installed a new state-of-the-art digital
banking system designed to improve our clients’ banking experience
across all channels of the organization. The new digital banking
platform has transformed our mobile and online banking experience,
bringing new features and services to our clients. Now that we’ve
completed the consumer upgrades, expect to see more regarding
business banking improvements in early 2024. Premier remains
committed to providing an exceptional customer experience, and are
committed to making investments that will best serve our clients
today and in the future.”
Quarterly results
Capital, deposits and liquidity
Regulatory ratios all improved during the third quarter of 2023,
including CET1 of 11.08%, Tier 1 of 11.55% and Total Capital of
13.33%, each up 23 basis points. All of these ratios also exceed
well-capitalized guidelines pro forma for accumulated other
comprehensive income (“AOCI”), including CET1 of 8.36%, Tier 1 of
8.84% and Total Capital of 10.61%.
Total deposits increased 4.1% annualized, or $71.2 million,
during the third quarter of 2023, due to a $92.3 million increase
in customer deposits (up 5.6% annualized), offset partly by a
decrease of $21.1 million in brokered deposits. Total average
interest-bearing deposit costs increased 47 basis points to 2.54%
for the third quarter of 2023. This increase was primarily due to
brokered deposits and the migration of customers from non-interest
bearing deposits into interest-bearing deposits, including higher
cost time deposits, as customers continue to seek better yields.
Total average customer deposit costs including non-interest and
excluding brokered deposits and acquisition marks were 1.85% during
the month of September, representing a cumulative beta of 32%
compared to the change in the monthly average effective Federal
Funds rate that increased 525 basis points to 5.33% since December
2021, as reported by the Federal Reserve Economic Data.
At September 30, 2023, uninsured deposits were 32.8% of total
deposits, or 17.7% adjusting for collateralized deposits, other
insured deposits and internal company accounts. Total quantifiable
liquidity sources totaled $2.57 billion, or 204.0% of adjusted
uninsured deposits, and were comprised of the following at
September 30, 2023:
- $117.5 million of cash and cash equivalents with a 5.40%
Federal Reserve rate;
- $280.9 million of unpledged securities with an average yield of
3.05%;
- $1.3 billion of Federal Home Loan Bank (“FHLB”) borrowing
capacity with an overnight borrowing rate of 5.40%;
- $316.7 million of brokered deposits based on a Company policy
limit of 10% of deposits, with market pricing dependent on brokers
and duration;
- $70.0 million of unused lines of credit with an average
borrowing rate of 6.65%; and
- $471.4 million of borrowing capacity at the Federal Reserve
with an average rate of 5.48%.
Additional liquidity sources include deposit growth, cash
earnings in excess of dividends, loan
repayments/participations/sales, and securities cash flows, which
are estimated to be $66.5 million over the next 12 months.
Net interest income and margin
Net interest income of $54.3 million on a tax equivalent (“TE”)
basis in the third quarter of 2023 was up 0.5% from $54.1 million
in the second quarter of 2023 but down 14.5% from $63.5 million in
the third quarter of 2022. The TE net interest margin of 2.73% in
the third quarter of 2023 increased one basis point from 2.72% in
the second quarter of 2023 but decreased 67 basis points from 3.40%
in the third quarter of 2022. Results for all periods include the
impact of Paycheck Protection Program (“PPP”) as well as
acquisition marks and related accretion. Third quarter 2023
includes $142 thousand of accretion in interest income, $180
thousand of accretion in interest expense, and $4 thousand of
interest income on average balances of $553 thousand for PPP.
Excluding the impact of acquisition marks accretion and PPP
loans, core net interest income was $54.0 million, up 0.6% from
$53.7 million in the second quarter of 2023 but down 14.1% from
$62.9 million in the third quarter of 2022. Additionally, the core
net interest margin was 2.71% for the third quarter of 2023, up one
basis point from 2.70% for the second quarter of 2023 but down 65
basis points from 3.36% for the third quarter of 2022. These
results are positively impacted by the combination of loan growth
and higher loan yields, which were 5.12% for the third quarter of
2023 compared to 4.86% in the second quarter of 2023 and 4.29% in
the third quarter of 2022. Excluding the impact of PPP, balance
sheet hedges and acquisition marks accretion, loan yields were
5.16% in September 2023 for an increase of 141 basis points since
December 2021, which represents a cumulative beta of 27% compared
to the change in the monthly average effective Federal Funds rate
for the same period.
The cost of funds in the third quarter of 2023 was 2.17%, up 25
basis points from the second quarter of 2023 and up 162 basis
points from the third quarter of 2022. The increases are largely
due to the higher average deposit costs discussed above. Excluding
the impact of balance sheet hedges and acquisition marks accretion,
cost of funds were 2.24% in September 2023 for an increase of 203
basis points since December 2021, which represents a cumulative
beta of 39% compared to the change in the monthly average effective
Federal Funds rate for the same period.
“Our margin has been very consistent over the past six months as
we’ve taken steps to attract new money at the right rate, manage
the migration of existing deposits into higher rate offerings, and
have appropriately repriced loan renewals to reflect today’s
environment,” said Small. “These steps, combined with nimble
balance sheet management, will be the key to additional net
interest income and margin improvement in the future.”
Non-interest income
Excluding insurance commissions, total non-interest income in
the third quarter of 2023 of $13.3 million was up 2.6% from $12.9
million in the second quarter of 2023 excluding the $36.3 million
gain on the sale of the insurance agency, and 0.3% from $13.2
million in the third quarter of 2022, primarily due to fluctuations
in mortgage banking and gains/losses on securities. Mortgage
banking income increased $0.3 million on a linked quarter basis but
decreased $0.7 million year-over-year, primarily as a result of
fluctuations in gain margins.
Security gains were $256 thousand in the third quarter of 2023,
partly due to increased valuations on equity securities. This
compares to gains of $64 thousand in the second quarter of 2023 and
$43 thousand in the third quarter of 2022, each primarily from
increased valuations on equity securities. Service fees in the
third quarter of 2023 were $6.9 million, a 3.4% decrease from $7.2
million in the second quarter of 2023 but a 6.1% increase from $6.5
million in the third quarter of 2022. This change was primarily due
to fluctuations in loan fees, including commercial customer swap
activity. Due to the insurance agency sale in the second quarter of
2023, there were no insurance commissions in the third quarter of
2023, compared to $4.1 million in the second quarter of 2023 and
$3.5 million in the third quarter of 2022. Wealth management income
of $1.5 million in the third quarter of 2023 was consistent with
$1.5 million in the second quarter of 2023 and up from $1.4 million
in the third quarter of 2022.
Non-interest expenses
Non-interest expenses in the third quarter of 2023 were $38.1
million, a 6.8% decrease from $40.8 million in the second quarter
of 2023, excluding transaction costs for the insurance agency sale,
and a 7.4% decrease from $41.1 million in the third quarter of
2022. Compensation and benefits were $21.8 million in the third
quarter of 2023, compared to $24.2 million in the second quarter of
2023 and $24.5 million in the third quarter of 2022. The linked
quarter decrease was primarily due to the insurance agency sale and
cost saving initiatives that began during the second quarter of
2023. The year-over-year decrease was primarily due to the
insurance agency sale, partially offset by costs related to higher
staffing levels for our 2022 growth initiatives and higher base
compensation, including 2022 mid-year adjustments and 2023 annual
adjustments. FDIC premiums decreased $0.4 million on a linked
quarter basis due to accrual true-up in the prior quarter, but
increased $0.4 million from the third quarter of 2022 primarily due
to year-over-year growth. All other non-interest expenses increased
only a net $11 thousand on a linked quarter basis and decreased a
net $0.7 million on a year-over-year basis due to the insurance
agency sale and cost saving initiatives. The efficiency ratio for
the third quarter of 2023 of 56.5% improved from 57.5% (excluding
transaction costs and the insurance agency gain on sale) in the
second quarter of 2023 due to cost saving initiatives but worsened
from 51.3% in the third quarter of 2022 due to lower revenues.
“We continue to execute on expense reductions and are pleased to
have improved our core efficiency ratio almost 100 basis points
this quarter,” said Paul Nungester, CFO of Premier. “Through the
combination of successful cost save initiatives implemented to-date
and the insurance agency sale, we have reduced our expense run-rate
11% to $152 million annualized from our beginning of the year
estimate of $170 million.”
Credit quality
Non-performing assets totaled $39.9 million, or 0.47% of assets,
at September 30, 2023, an increase from $37.6 million at June 30,
2023, and from $33.6 million at September 30, 2022. Loan
delinquencies decreased to $17.2 million, or 0.24% of loans, at
September 30, 2023, from $19.0 million at June 30, 2023, but
increased from $13.2 million at September 30, 2022. Classified
loans totaled $63.5 million, or 0.90% of loans, as of September 30,
2023, an increase from $60.5 million at June 30, 2023, and from
$45.0 million at September 30, 2022.
The 2023 third quarter results include net recoveries of $347
thousand and a total provision benefit of $0.8 million, compared
with net loan charge-offs of $154 thousand and a total provision
expense of $4.0 million for the same period in 2022. The allowance
for credit losses as a percentage of total loans was 1.14% at
September 30, 2023, compared with 1.13% at June 30, 2023, and 1.14%
at September 30, 2022. The allowance for credit losses as a
percentage of total loans excluding PPP and including unaccreted
acquisition marks was 1.17% at September 30, 2023, compared with
1.16% at June 30, 2023, and 1.19% at September 30, 2022. The
continued economic improvement following the 2020 pandemic-related
downturn has resulted in a year-over-year decrease in the allowance
percentages.
“Our commercial and credit teams have expanded their loan review
and analysis routines looking for early warning indicators of
potential stress on specific loans and categories (e.g., office),
with particular focus on ‘shocking’ the portfolio for the effect of
future repricing scenarios,” said Small.
Year to date results
For the nine-month period ended September 30, 2023, net income
totaled $91.2 million, or $2.55 per diluted common share, compared
to $76.9 million, or $2.15 per diluted common share for the nine
months ended September 30, 2022. 2023 results include the impact of
the insurance agency sale for a net gain on sale after transaction
costs of $32.6 million pre-tax, or $0.67 per diluted share
after-tax. Excluding the impact of this item, year-to-date 2023
core net income were $67.1 million, or $1.87 per diluted share.
Net interest income of $164.8 million on a TE basis for the
first nine months of 2023 was down 8.9% from $181.0 million for the
same period in 2022. The TE net interest margin of 2.78% in the
first nine months of 2023 decreased 62 basis points from 3.40% for
the same period in 2022. Results for all periods include the impact
of PPP as well as acquisition marks and related accretion. 2023
year-to-date includes $475 thousand of accretion in interest
income, $613 thousand of accretion in interest expense, and $15
thousand of interest income on average balances of $729 thousand
for PPP. Excluding the impact of acquisition marks accretion and
PPP loans, core net interest income was $163.7 million, down 6.5%
from $175.1 million in the first nine months 2022. Additionally,
the core net interest margin was 2.76% for the first nine months of
2023, down 53 basis points from 3.29% for the same period of 2022.
These results are positively impacted by the combination of loan
growth and higher loan yields, which were 4.88% for the first nine
months of 2023 compared to 4.13% for the same period in 2022. The
cost of funds in the first nine months of 2023 was 1.87%, up 154
basis points for the same period of 2022. The year-over-year
increase is largely due to utilization of higher cost FHLB
borrowings in support of loan growth in excess of deposit growth
during 2022.
Excluding insurance commissions and the $36.3 million gain on
the sale of the insurance agency, total non-interest income in the
first nine months of 2023 of $33.9 million was down 5.5% from $35.9
million for the same period of 2022. Insurance commissions were
$8.9 million in 2023 down from $12.0 million in the first nine
months of 2022 due to the insurance agency sale on June 30, 2023.
Mortgage banking income decreased $4.2 million year-over-year as a
result of a $3.1 million decrease in gains primarily from lower
production and margins, as well as a $155 thousand mortgage
servicing rights (“MSR”) valuation gain in the first nine months of
2023 compared to a $1.6 million gain for the same period of
2022.
Security losses were $1.1 million in the nine months of 2023,
primarily due to decreased valuations on equity securities. This
compares to a loss of $1.8 million from decreased valuations on
equity securities in the first nine months 2022. The company also
sold $21 million of available-for-sale (“AFS”) securities for a $27
thousand gain with average yields less than FHLB borrowing rates
during the first nine months of 2023. Service fees in the first
nine months of 2023 were $20.6 million, a 7.0% increase from $19.2
million in the first nine months of 2022, primarily due to
fluctuations in loan fees including commercial customer swap
activity and consumer activity for interchange and ATM/NSF charges.
Wealth management income of $4.5 million in the first nine months
of 2023 was up 6.7% from $4.2 million in the first nine months of
2022. Bank owned life insurance income of $3.5 million in the first
nine months of 2023 increased from $3.0 million in the first nine
months of 2022 with $0.4 million of claim gains in 2023 compared to
none in 2022.
Excluding transaction costs for the insurance agency sale,
non-interest expenses in the first nine months of 2023 were $121.7
million, essentially flat from $121.5 million in the first nine
months of 2022. Compensation and benefits were $71.6 million in the
first nine months of 2023, compared to $72.4 million in the first
nine months of 2022. The year-over-year decrease was primarily due
to the insurance agency sale on June 30, 2023, and cost saving
initiatives that began during the second quarter of 2023 partially
offset by costs related to higher staffing levels for our 2022
growth initiatives and higher base compensation, including 2022
mid-year adjustments and 2023 annual adjustments. FDIC premiums
increased $2.1 million on a year-over-year basis primarily due to
higher rates and our 2022 growth initiatives. All other
non-interest expenses decreased a net $1.1 million on a
year-over-year basis. The efficiency ratio (excluding transaction
costs and the insurance agency gain on sale) for the first nine
months of 2023 of 58.3% worsened from 52.7% in the first nine
months of 2022 due to lower revenues partly offset by cost saving
initiatives that began during the second quarter of 2023.
Results for the first nine months of 2023 include net loan
charge-offs of $1.9 million and a total provision expense of $3.5
million, compared with net loan charge-offs of $5.3 million and a
total provision expense of $11.5 million for the same period in
2022. The provision expense for both years is primarily due to
relative loan growth.
Total assets at $8.56 billion
Total assets at September 30, 2023, were $8.56 billion, compared
to $8.62 billion at June 30, 2023, and $8.24 billion at September
30, 2022. Loans receivable were $6.70 billion at September 30,
2023, compared to $6.71 billion at June 30, 2023, and $6.21 billion
at September 30, 2022. At September 30, 2023, loans receivable
increased $489.2 million on a year-over-year basis, or 7.9%.
Commercial loans excluding PPP increased by $248.3 million from
September 30, 2022, or 6.0%. Securities at September 30, 2023, were
$0.92 billion, compared to $0.97 billion at June 30, 2023, and
$1.08 billion at September 30, 2022. All securities are either AFS
or trading and are reflected at fair value on the balance sheet.
Also, at September 30, 2023, goodwill and other intangible assets
totaled $308.8 million compared to $309.9 million at June 30, 2023,
and $337.9 million at September 30, 2022, with the decreases
attributable to intangibles amortization and the insurance agency
sale.
Total non-brokered deposits at September 30, 2023, were $6.67
billion, compared with $6.58 billion at June 30, 2023, and $6.67
billion at September 30, 2022. At September 30, 2023, customer
deposits increased $92.3 million on a linked quarter basis, or 5.6%
annualized. Brokered deposits were $392.2 million at September 30,
2023, compared to $413.2 million at June 30, 2023 and $69.9 million
at September 30, 2022.
Total stockholders’ equity was $919.6 million at September 30,
2023, compared to $937.0 million at June 30, 2023, and $865.0
million at September 30, 2022. The quarterly decrease in
stockholders’ equity was primarily due to a decrease in AOCI, which
was related to $24.9 million for a negative valuation adjustment on
the AFS securities portfolio, partly offset by net earnings after
dividends. The year-over-year increase was primarily due to net
earnings after dividends including the impact the insurance agency
sale offset partly by a decrease in AOCI, which was primarily
related to $16.3 million of negative valuation adjustments on the
AFS securities portfolio. At September 30, 2023, 1,199,634 common
shares remained available for repurchase under the Company’s
existing repurchase program.
Dividend to be paid November 17
The Board of Directors declared a quarterly cash dividend of
$0.31 per common share payable November 17, 2023, to shareholders
of record at the close of business on November 10, 2023. The
dividend represents an annual dividend of 7.5 percent based on the
Premier common stock closing price on October 23, 2023. Premier has
approximately 35,731,000 common shares outstanding.
Conference call
Premier will host a conference call at 11:00 a.m. ET on
Wednesday, October 25, 2023, to discuss the earnings results and
business trends. The conference call may be accessed by calling
1-833-470-1428 and using access code 346494. Internet access to the
call is also available (in listen-only mode) at the following URL:
https://events.q4inc.com/attendee/320076724. The webcast replay of
the conference call will be available at www.PremierFinCorp.com for
one year.
About Premier Financial Corp.
Premier Financial Corp. (Nasdaq: PFC), headquartered in
Defiance, Ohio, is the holding company for Premier Bank. Premier
Bank, headquartered in Youngstown, Ohio, operates 75 branches and 9
loan offices in Ohio, Michigan, Indiana and Pennsylvania and also
serves clients through a team of wealth professionals dedicated to
each community banking branch. For more information, visit the
company’s website at PremierFinCorp.com.
Financial Statements and Highlights Follow-
Safe Harbor Statement
This document may contain certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and the Private Securities Litigation Reform Act of 1995.
These statements may include, but are not limited to, statements
regarding projections, forecasts, goals and plans of Premier
Financial Corp. and its management, future movements of interests,
loan or deposit production levels, future credit quality ratios,
future strength in the market area, and growth projections. These
statements do not describe historical or current facts and may be
identified by words such as “intend,” “intent,” “believe,”
“expect,” “estimate,” “target,” “plan,” “anticipate,” or similar
words or phrases, or future or conditional verbs such as “will,”
“would,” “should,” “could,” “might,” “may,” “can,” or similar
verbs. There can be no assurances that the forward-looking
statements included in this presentation will prove to be accurate.
In light of the significant uncertainties in the forward-looking
statements, the inclusion of such information should not be
regarded as a representation by Premier or any other persons, that
our objectives and plans will be achieved. Forward-looking
statements involve numerous risks and uncertainties, any one or
more of which could affect Premier’s business and financial results
in future periods and could cause actual results to differ
materially from plans and projections. These risks and
uncertainties include, but not limited to: financial markets, our
customers, and our business and results of operation; changes in
interest rates; disruptions in the mortgage market; risks and
uncertainties inherent in general and local banking, insurance and
mortgage conditions; political uncertainty; uncertainty in U.S.
fiscal or monetary policy; uncertainty concerning or disruptions
relating to tensions surrounding the current socioeconomic
landscape; competitive factors specific to markets in which Premier
and its subsidiaries operate; increasing competition for financial
products from other financial institutions and nonbank financial
technology companies; future interest rate levels; legislative or
regulatory rulemaking or actions; capital market conditions;
security breaches or unauthorized disclosure of confidential
customer or Company information; interruptions in the effective
operation of information and transaction processing systems of
Premier or Premier’s vendors and service providers; failures or
delays in integrating or adopting new technology; the impact of the
cessation of LIBOR interest rates and implementation of a
replacement rate; and other risks and uncertainties detailed from
time to time in our Securities and Exchange Commission (SEC)
filings, including our Annual Report on Form 10-K for the year
ended December 31, 2022 and any further amendments thereto. All
forward-looking statements made in this presentation are based on
information presently available to the management of Premier and
speak only as of the date on which they are made. We assume no
obligation to update any forward-looking statements, whether as a
result of new information, future developments or otherwise, except
as may be required by law. As required by U.S. GAAP, Premier will
evaluate the impact of subsequent events through the issuance date
of its September 30, 2023, consolidated financial statements as
part of its Quarterly Report on Form 10-Q to be filed with the SEC.
Accordingly, subsequent events could occur that may cause Premier
to update its critical accounting estimates and to revise its
financial information from that which is contained in this news
release.
Non-GAAP Reporting Measures
We believe that net income, as defined by U.S. GAAP, is the most
appropriate earnings measurement. However, we consider core net
interest income, core net income and core pre-tax pre-provision
income to be a useful supplemental measure of our operating
performance. We define core net interest income as net interest
income on a tax-equivalent basis excluding income from PPP loans
and purchase accounting marks accretion. We define core net income
as net income excluding the after-tax impact of the insurance
agency gain on sale and related transaction costs. We define core
pre-tax pre-provision income as pre-tax pre-provision income
excluding the pre-tax impact of the insurance agency gain on sale
and related transaction costs. We believe that these metrics are
useful supplemental measures of operating performance because
investors and equity analysts may use these measures to compare the
operating performance of the Company between periods or as compared
to other financial institutions or other companies on a consistent
basis without having to account for income from PPP loans, purchase
accounting marks accretion or the insurance agency sale. Our
supplemental reporting measures and similarly entitled financial
measures are widely used by investors, equity and debt analysts and
ratings agencies in the valuation, comparison, rating and
investment recommendations of companies. Our management uses these
financial measures to facilitate internal and external comparisons
to historical operating results and in making operating decisions.
Additionally, they are utilized by the Board of Directors to
evaluate management. The supplemental reporting measures do not
represent net income or cash flow provided from operating
activities as determined in accordance with U.S. GAAP and should
not be considered as alternative measures of profitability or
liquidity. Finally, the supplemental reporting measures, as defined
by us, may not be comparable to similarly entitled items reported
by other financial institutions or other companies. Please see the
exhibits for reconciliations of our supplemental reporting
measures.
Consolidated Balance Sheets (Unaudited) Premier Financial
Corp.
September 30,
June 30,
March 31,
December 31,
September 30,
(in thousands)
2023
2023
2023
2022
2022
Assets Cash and cash equivalents Cash and amounts due
from depositories
$
70,642
$
71,096
$
68,628
$
88,257
$
67,124
Interest-bearing deposits
46,855
50,631
88,399
39,903
37,868
117,497
121,727
157,027
128,160
104,992
Available-for-sale, carried at fair value
911,184
961,123
998,128
1,040,081
1,063,713
Equity securities, carried at fair value
5,860
6,458
6,387
7,832
15,336
Securities investments
917,044
967,581
1,004,515
1,047,913
1,079,049
Loans (1)
6,696,869
6,708,568
6,575,829
6,460,620
6,207,708
Allowance for credit losses - loans
(76,513
)
(75,921
)
(74,273
)
(72,816
)
(70,626
)
Loans, net
6,620,356
6,632,647
6,501,556
6,387,804
6,137,082
Loans held for sale
135,218
128,079
119,604
115,251
129,142
Mortgage servicing rights
19,642
20,160
20,654
21,171
20,832
Accrued interest receivable
34,648
30,056
29,388
28,709
26,021
Federal Home Loan Bank stock
25,049
39,887
37,056
29,185
28,262
Bank Owned Life Insurance
172,906
171,856
170,841
170,713
169,728
Office properties and equipment
55,679
55,736
55,982
55,541
53,747
Real estate and other assets held for sale
387
561
393
619
416
Goodwill
295,602
295,602
317,988
317,988
317,948
Core deposit and other intangibles
13,220
14,298
17,804
19,074
19,972
Other assets
155,628
138,021
129,508
133,214
148,949
Total Assets
$
8,562,876
$
8,616,211
$
8,562,316
$
8,455,342
$
8,236,140
Liabilities and Stockholders’ Equity
Non-interest-bearing deposits
$
1,545,595
$
1,573,837
$
1,649,726
$
1,869,509
$
1,826,511
Interest-bearing deposits
5,127,863
5,007,358
4,969,436
4,893,502
4,836,113
Brokered deposits
392,181
413,237
154,869
143,708
69,881
Total deposits
7,065,639
6,994,432
6,774,031
6,906,719
6,732,505
Advances from FHLB
339,000
455,000
658,000
428,000
411,000
Subordinated debentures
85,197
85,166
85,123
85,103
85,071
Advance payments by borrowers
22,781
26,045
26,300
34,188
33,511
Reserve for credit losses - unfunded commitments
4,690
5,708
6,577
6,816
7,061
Other liabilities
126,002
112,889
97,835
106,795
102,032
Total Liabilities
7,643,309
7,679,240
7,647,866
7,567,621
7,371,180
Stockholders’ Equity Preferred stock
-
-
-
-
-
Common stock, net
306
306
306
306
306
Additional paid-in-capital
690,038
689,579
689,807
691,453
691,578
Accumulated other comprehensive income (loss)
(200,282
)
(168,721
)
(153,709
)
(173,460
)
(181,231
)
Retained earnings
560,945
547,336
510,021
502,909
488,305
Treasury stock, at cost
(131,440
)
(131,529
)
(131,975
)
(133,487
)
(133,998
)
Total Stockholders’ Equity
919,567
936,971
914,450
887,721
864,960
Total Liabilities and Stockholders’ Equity
$
8,562,876
$
8,616,211
$
8,562,316
$
8,455,342
$
8,236,140
(1) Includes PPP loans of:
$
526
$
577
$
791
$
1,143
$
1,181
Consolidated Statements of Income (Unaudited)
Premier Financial Corp. Three Months Ended Nine
Months Ended (in thousands, except per share amounts)
9/30/23 6/30/23 3/31/23 12/31/22 9/30/22
9/30/23
9/30/22 Interest Income: Loans
$
86,612
$
81,616
$
76,057
$
72,194
$
65,559
$
244,285
$
177,366
Investment securities
6,943
6,997
7,261
7,605
6,814
21,201
18,489
Interest-bearing deposits
652
641
444
444
221
1,737
387
FHLB stock dividends
690
905
394
482
510
1,989
743
Total interest income
94,897
90,159
84,156
80,725
73,104
269,212
196,985
Interest Expense: Deposits
34,874
26,825
21,458
13,161
6,855
83,157
11,749
FHLB advances
4,597
8,217
5,336
3,941
2,069
18,150
2,609
Subordinated debentures
1,162
1,125
1,075
1,000
868
3,362
2,326
Notes Payable
-
-
-
4
-
-
1
Total interest expense
40,633
36,167
27,869
18,106
9,792
104,669
16,685
Net interest income
54,264
53,992
56,287
62,619
63,312
164,543
180,300
Provision (benefit) for credit losses - loans
245
1,410
3,944
3,020
3,706
5,599
9,483
Provision (benefit) for credit losses - unfunded commitments
(1,018
)
(870
)
(238
)
(246
)
306
(2,126
)
2,030
Total provision (benefit) for credit losses
(773
)
540
3,706
2,774
4,012
3,473
11,513
Net interest income after provision
55,037
53,452
52,581
59,845
59,300
161,070
168,787
Non-interest Income: Service fees and other charges
6,947
7,190
6,428
6,632
6,545
20,564
19,221
Mortgage banking income
3,274
2,940
(274
)
(299
)
3,970
5,940
10,170
Gain (loss) on sale of non-mortgage loans
-
71
-
-
-
71
-
Gain (loss) on sale of available for sale securities
-
(7
)
34
1
-
27
-
Gain (loss) on equity securities
256
71
(1,445
)
1,209
43
(1,118
)
(1,760
)
Gain on sale of insurance agency
-
36,296
-
-
-
36,296
-
Insurance commissions
-
4,131
4,725
3,576
3,488
8,856
12,043
Wealth management income
1,509
1,537
1,485
1,582
1,355
4,531
4,246
Income from Bank Owned Life Insurance
1,050
1,015
1,417
984
983
3,482
2,961
Other non-interest income
217
102
92
543
320
412
1,051
Total Non-interest Income
13,253
53,346
12,462
14,228
16,704
79,061
47,932
Non-interest Expense: Compensation and benefits
21,813
24,175
25,658
24,999
24,522
71,646
72,397
Occupancy
3,145
3,320
3,574
3,383
3,463
10,039
10,657
FDIC insurance premium
1,346
1,786
1,288
1,276
976
4,420
2,370
Financial institutions tax
989
961
852
795
1,050
2,802
3,315
Data processing
4,010
3,640
3,863
3,882
3,121
11,513
9,899
Amortization of intangibles
1,078
1,223
1,270
1,293
1,338
3,571
4,156
Transaction costs
-
3,652
-
-
-
3,652
-
Other non-interest expense
5,671
5,738
6,286
7,400
6,629
17,695
18,689
Total Non-interest Expense
38,052
44,495
42,791
43,028
41,099
125,338
121,483
Income before income taxes
30,238
62,303
22,252
31,045
34,905
114,793
95,236
Income tax expense
5,551
13,912
4,103
5,770
6,710
23,566
18,324
Net Income
$
24,687
$
48,391
$
18,149
$
25,275
$
28,195
$
91,227
$
76,912
Earnings per common share: Basic
$
0.69
$
1.35
$
0.51
$
0.71
$
0.79
$
2.55
$
2.15
Diluted
$
0.69
$
1.35
$
0.51
$
0.71
$
0.79
$
2.55
$
2.15
Average Shares Outstanding: Basic
35,730
35,722
35,606
35,589
35,582
35,701
35,709
Diluted
35,794
35,800
35,719
35,790
35,704
35,769
35,818
Premier Financial Corp. Selected Quarterly
Information Three Months Ended Nine Months Ended
(dollars in thousands, except per share data)
9/30/23
6/30/23 3/31/23 12/31/22 9/30/22
9/30/23 9/30/22
Summary
of Operations Tax-equivalent interest income (1)
$
94,951
$
90,226
$
84,260
$
80,889
$
73,301
$
269,437
$
197,637
Interest expense
40,633
36,167
27,869
18,106
9,792
104,669
16,685
Tax-equivalent net interest income (1)
54,318
54,059
56,391
62,783
63,509
164,768
180,952
Provision expense for credit losses
(773
)
540
3,706
2,774
4,012
3,473
11,513
Non-interest income (ex securities gains/losses)
12,997
53,282
13,873
13,018
16,661
80,152
49,692
Core non-interest income (ex securities gains/losses) (2)
12,997
16,986
13,873
13,018
16,661
43,856
49,692
Non-interest expense
38,052
44,495
42,791
43,028
41,099
125,338
121,483
Core non-interest expense (2)
38,052
40,843
42,791
43,028
41,099
121,686
121,483
Income tax expense
5,551
13,912
4,103
5,770
6,710
23,566
18,324
Net income
24,687
48,391
18,149
25,275
28,195
91,227
76,912
Core net income (2)
24,687
24,230
18,149
25,275
28,195
67,066
76,912
Tax equivalent adjustment (1)
54
67
104
164
197
225
652
At Period End Total assets
$
8,562,876
$
8,616,211
$
8,562,316
$
8,455,342
$
8,236,140
Goodwill and intangibles
308,822
309,900
335,792
337,062
337,920
Tangible assets (3)
8,254,054
8,306,311
8,226,524
8,118,280
7,898,220
Earning assets
7,744,522
7,818,825
7,751,130
7,620,056
7,411,403
Loans
6,696,869
6,708,568
6,575,829
6,460,620
6,207,708
Allowance for loan losses
76,513
75,921
74,273
72,816
70,626
Deposits
7,065,639
6,994,432
6,774,031
6,906,719
6,732,505
Stockholders’ equity
919,567
936,971
914,450
887,721
864,960
Stockholders’ equity / assets
10.74
%
10.87
%
10.68
%
10.50
%
10.50
%
Tangible equity (3)
610,745
627,071
578,658
550,659
527,040
Tangible equity / tangible assets
7.40
%
7.55
%
7.03
%
6.78
%
6.67
%
Average Balances Total assets
$
8,582,219
$
8,597,786
$
8,433,100
$
8,304,462
$
8,161,389
$
8,538,248
$
7,807,013
Earning assets
7,969,363
7,951,520
7,783,850
7,653,648
7,477,795
7,904,565
7,097,421
Loans
6,763,232
6,714,240
6,535,080
6,359,564
6,120,324
6,671,687
5,726,369
Deposits and interest-bearing liabilities
7,486,595
7,538,674
7,385,946
7,278,531
7,116,910
7,470,774
6,748,783
Deposits
7,045,827
6,799,605
6,833,521
6,773,382
6,654,328
6,893,762
6,452,713
Stockholders’ equity
939,456
921,441
901,587
875,287
912,224
920,967
945,141
Goodwill and intangibles
309,330
334,862
336,418
337,207
338,583
326,771
339,946
Tangible equity (3)
630,126
586,579
565,169
538,080
573,641
594,196
605,195
Per Common Share Data Earnings per share ("EPS") - Basic
$
0.69
$
1.35
$
0.51
$
0.71
$
0.79
$
2.55
$
2.15
EPS - Diluted
0.69
1.35
0.51
0.71
0.79
2.55
2.15
EPS - Core diluted (2)
0.69
0.68
0.51
0.71
0.79
1.87
2.15
Dividends Paid
0.31
0.31
0.31
0.30
0.30
0.93
0.90
Market Value: High
$
22.89
$
21.01
$
27.80
$
30.51
$
29.36
$
27.99
$
32.52
Low
15.70
13.60
20.39
26.11
24.67
13.60
24.67
Close
17.06
16.02
20.73
26.97
25.70
17.06
25.70
Common Book Value
25.74
26.23
25.61
24.94
24.32
Tangible Common Book Value (3)
17.09
17.55
16.21
15.47
14.82
Shares outstanding, end of period (000s)
35,731
35,727
35,701
35,591
35,563
Performance Ratios (annualized) Tax-equivalent net interest
margin (1)
2.73
%
2.72
%
2.90
%
3.28
%
3.40
%
2.78
%
3.40
%
Return on average assets
1.14
%
2.26
%
0.86
%
1.21
%
1.37
%
1.43
%
1.32
%
Core return on average assets (2)
1.14
%
1.13
%
0.86
%
1.22
%
1.39
%
1.05
%
1.32
%
Return on average equity
10.43
%
21.06
%
8.07
%
11.46
%
12.26
%
13.24
%
10.88
%
Core return on average equity (2)
10.43
%
10.55
%
8.07
%
11.58
%
12.40
%
9.74
%
10.88
%
Return on average tangible equity
15.54
%
33.09
%
12.88
%
18.64
%
19.50
%
20.53
%
16.99
%
Core return on average tangible equity (2)
15.54
%
16.57
%
10.51
%
14.64
%
16.33
%
15.09
%
16.99
%
Efficiency ratio (4)
56.53
%
41.45
%
60.90
%
56.76
%
51.26
%
51.18
%
52.67
%
Core efficiency ratio (2)
56.53
%
57.49
%
60.90
%
56.76
%
51.26
%
58.33
%
52.67
%
Effective tax rate
18.36
%
22.33
%
18.44
%
18.59
%
19.22
%
20.53
%
19.24
%
Common dividend payout ratio
44.93
%
22.96
%
60.78
%
42.25
%
37.97
%
36.47
%
41.86
%
(1) Interest income on tax-exempt securities and loans has been
adjusted to a tax-equivalent basis using the statutory federal
income tax rate of 21%. (2) Core items exclude the impact of
insurance agency disposition related items. See non-GAAP
reconciliations. (3) Tangible assets = total assets less the sum of
goodwill and core deposit and other intangibles. Tangible equity =
total stockholders' equity less the sum of goodwill, core deposit
and other intangibles, and preferred stock. Tangible common book
value = tangible equity divided by shares outstanding at the end of
the period. (4) Efficiency ratio = Non-interest expense divided by
sum of tax-equivalent net interest income plus non-interest income,
excluding securities gains or losses, net.
Premier Financial
Corp. Yield Analysis (dollars in thousands)
Three
Months Ended Nine Months Ended 9/30/23 6/30/23
3/31/23 12/31/22 9/30/22
9/30/23 9/30/22
Average
Balances Interest-earning assets: Loans receivable (1)
$
6,763,232
$
6,714,240
$
6,535,080
$
6,359,564
$
6,120,324
$
6,671,687
$
5,726,369
Securities
1,137,730
1,155,451
1,190,359
1,236,511
1,262,435
1,160,987
1,266,681
Interest Bearing Deposits
38,210
36,730
35,056
29,884
68,530
36,677
84,745
FHLB stock
30,191
45,099
30,353
28,386
27,414
35,214
19,626
Total interest-earning assets
7,969,363
7,951,520
7,790,848
7,654,345
7,478,703
7,904,565
7,097,421
Non-interest-earning assets
612,856
646,266
642,252
650,117
682,686
633,683
709,592
Total assets
$
8,582,219
$
8,597,786
$
8,433,100
$
8,304,462
$
8,161,389
$
8,538,248
$
7,807,013
Deposits and Interest-bearing Liabilities: Interest bearing
deposits
$
5,490,945
$
5,195,727
$
5,078,510
$
4,901,412
$
4,846,419
$
5,256,571
$
4,688,047
FHLB advances and other
355,576
653,923
467,311
419,761
377,533
491,861
210,908
Subordinated debentures
85,179
85,146
85,114
85,084
85,049
85,147
85,019
Notes payable
13
-
-
304
-
4
143
Total interest-bearing liabilities
5,931,713
5,934,796
5,630,935
5,406,561
5,309,001
5,833,583
4,984,117
Non-interest bearing deposits
1,554,882
1,603,878
1,755,011
1,871,970
1,807,909
1,637,191
1,764,666
Total including non-interest-bearing deposits
7,486,595
7,538,674
7,385,946
7,278,531
7,116,910
7,470,774
6,748,783
Other non-interest-bearing liabilities
156,168
137,671
145,567
150,644
132,255
146,507
113,089
Total liabilities
7,642,763
7,676,345
7,531,513
7,429,175
7,249,165
7,617,281
6,861,872
Stockholders' equity
939,456
921,441
901,587
875,287
912,224
920,967
945,141
Total liabilities and stockholders' equity
$
8,582,219
$
8,597,786
$
8,433,100
$
8,304,462
$
8,161,389
$
8,538,248
$
7,807,013
IEAs/IBLs
134
%
134
%
138
%
142
%
141
%
136
%
142
%
Interest Income/Expense Interest-earning
assets: Loans receivable (2)
$
86,618
$
81,622
$
76,063
$
72,201
$
65,564
$
244,303
$
177,385
Securities (2)
6,991
7,058
7,359
7,762
7,006
21,408
19,122
Interest Bearing Deposits
652
641
444
444
221
1,737
387
FHLB stock
690
905
394
482
510
1,989
743
Total interest-earning assets
94,951
90,226
84,260
80,889
73,301
269,437
197,637
Deposits and Interest-bearing Liabilities: Interest bearing
deposits
$
34,874
$
26,825
$
21,458
$
13,161
$
6,855
$
83,157
$
11,749
FHLB advances and other
4,597
8,217
5,336
3,941
2,069
18,150
2,609
Subordinated debentures
1,162
1,125
1,075
1,001
868
3,362
2,326
Notes payable
-
-
-
3
-
-
1
Total interest-bearing liabilities
40,633
36,167
27,869
18,106
9,792
104,669
16,685
Non-interest bearing deposits
-
-
-
-
-
-
-
Total including non-interest-bearing deposits
40,633
36,167
27,869
18,106
9,792
104,669
16,685
Net interest income
$
54,318
$
54,059
$
56,391
$
62,783
$
63,509
$
164,768
$
180,952
Less: PPP income
(4
)
(5
)
(6
)
(6
)
(26
)
(15
)
(3,827
)
Less: Acquisition marks accretion
(322
)
(380
)
(387
)
(554
)
(608
)
(1,088
)
(2,051
)
Core net interest income
$
53,992
$
53,674
$
55,998
$
62,223
$
62,875
$
163,665
$
175,074
Annualized Average Rates Interest-earning
assets: Loans receivable
5.12
%
4.86
%
4.66
%
4.54
%
4.29
%
4.88
%
4.13
%
Securities (3)
2.46
%
2.44
%
2.47
%
2.51
%
2.22
%
2.46
%
2.01
%
Interest Bearing Deposits
6.83
%
6.98
%
5.07
%
5.94
%
1.29
%
6.31
%
0.61
%
FHLB stock
9.14
%
8.03
%
5.19
%
6.79
%
7.44
%
7.53
%
5.05
%
Total interest-earning assets
4.77
%
4.54
%
4.33
%
4.23
%
3.92
%
4.54
%
3.71
%
Deposits and Interest-bearing Liabilities: Interest bearing
deposits
2.54
%
2.07
%
1.69
%
1.07
%
0.57
%
2.11
%
0.33
%
FHLB advances and other
5.17
%
5.03
%
4.57
%
3.76
%
2.19
%
4.92
%
1.65
%
Subordinated debentures
5.46
%
5.29
%
5.05
%
4.71
%
4.08
%
5.26
%
3.65
%
Notes payable
-
-
-
3.95
%
-
-
0.93
%
Total interest-bearing liabilities
2.74
%
2.44
%
1.98
%
1.34
%
0.74
%
3.59
%
0.67
%
Non-interest bearing deposits
-
-
-
-
-
-
-
Total including non-interest-bearing deposits
2.17
%
1.92
%
1.51
%
1.00
%
0.55
%
1.87
%
0.33
%
Net interest spread
2.03
%
2.10
%
2.35
%
2.89
%
3.18
%
0.95
%
3.04
%
Net interest margin (4)
2.73
%
2.72
%
2.90
%
3.28
%
3.40
%
2.78
%
3.40
%
Core net interest margin (4)
2.71
%
2.70
%
2.88
%
3.25
%
3.36
%
2.76
%
3.29
%
(1) Includes average PPP loans of:
$
553
$
673
$
965
$
1,160
$
1,889
$
729
$
15,790
(2) Interest on certain tax exempt loans and securities is not
taxable for Federal income tax purposes. In order to compare the
tax-exempt yields on these assets to taxable yields, the interest
earned on these assets is adjusted to a pre-tax equivalent amount
based on the marginal corporate federal income tax rate of 21%. (3)
Securities yield = annualized interest income divided by the
average balance of securities, excluding average unrealized
gains/losses. (4) Net interest margin is tax equivalent net
interest income divided by average interest-earning assets. Core
net interest margin represents net interest margin excluding PPP
and acquisition marks accretion.
Premier Financial Corp.
Deposits and Liquidity (dollars in thousands)
As of and
for the Three Months Ended 9/30/23 6/30/23 3/31/23
12/31/22 9/30/22
Ending Balances Non-interest-bearing demand
deposits
$
1,545,595
$
1,573,837
$
1,649,726
$
1,869,509
$
1,826,511
Savings deposits
709,938
748,392
775,186
797,376
817,853
Interest-bearing demand deposits
580,069
594,325
646,329
653,960
665,974
Money market account deposits
1,279,551
1,282,721
1,342,451
1,493,729
1,463,600
Time deposits
925,353
904,717
856,720
768,678
630,077
Public funds, ICS and CDARS deposits
1,632,952
1,477,203
1,348,750
1,179,759
1,258,610
Brokered deposits
392,181
413,237
154,869
143,708
69,881
Total deposits
$
7,065,639
$
6,994,432
$
6,774,031
$
6,906,719
$
6,732,505
Average Balances Non-interest-bearing demand deposits
$
1,554,882
$
1,603,878
$
1,755,011
$
1,871,970
$
1,807,909
Savings deposits
728,545
762,074
782,215
806,653
825,673
Interest-bearing demand deposits
575,744
603,572
637,423
651,685
681,247
Money market account deposits
1,278,381
1,311,177
1,430,905
1,418,549
1,493,019
Time deposits
912,579
872,991
825,652
685,453
610,708
Public funds, ICS and CDARS deposits
1,573,213
1,399,749
1,232,230
1,235,772
1,204,968
Brokered deposits
422,483
246,164
170,085
103,300
30,804
Total deposits
$
7,045,827
$
6,799,605
$
6,833,521
$
6,773,382
$
6,654,328
Average Rates Non-interest-bearing demand deposits
0.00
%
0.00
%
0.00
%
0.00
%
0.00
%
Savings deposits
0.03
%
0.02
%
0.02
%
0.02
%
0.02
%
Interest-bearing demand deposits
0.11
%
0.10
%
0.07
%
0.07
%
0.07
%
Money market account deposits
2.02
%
1.73
%
1.54
%
0.81
%
0.40
%
Time deposits
2.68
%
2.27
%
1.83
%
1.05
%
0.58
%
Public funds, ICS and CDARS deposits
4.18
%
3.71
%
3.32
%
2.41
%
1.38
%
Brokered deposits
5.36
%
4.92
%
4.19
%
3.32
%
2.37
%
Total deposits
1.98
%
1.58
%
1.26
%
0.78
%
0.41
%
Other Deposits Data Loans/Deposits Ratio
94.8
%
95.9
%
97.1
%
93.5
%
92.2
%
Uninsured deposits %
32.8
%
31.5
%
32.3
%
35.3
%
35.5
%
Adjusted uninsured deposits % (1)
17.7
%
17.3
%
19.6
%
22.2
%
22.2
%
Top 20 depositors %
14.1
%
12.4
%
12.1
%
5.4
%
11.3
%
Public funds %
18.8
%
17.5
%
16.5
%
14.8
%
15.9
%
Average account size (excluding brokered)
$
27.1
$
26.7
$
27.0
$
27.8
$
27.5
Securities Data Held-to-maturity (HTM) at fair value
$
-
$
-
$
-
$
-
$
-
Available-for-sale (AFS) at fair value (2)
911,184
961,123
998,128
1,040,081
1,063,713
Equity investment at fair value (3)
5,860
6,458
6,387
7,832
15,336
Total securities at fair value
$
917,044
$
967,581
$
1,004,515
$
1,047,913
$
1,079,049
Cash+Securities/Assets
12.1
%
12.6
%
13.6
%
13.9
%
14.4
%
Projected AFS cash flow in next 12 months
$
66,495
$
64,687
$
73,184
$
73,319
$
76,119
AFS average life (years)
6.5
6.5
6.4
6.5
6.6
Liquidity Sources Cash and cash equivalents
$
117,497
$
121,727
$
157,027
$
128,160
$
104,992
Unpledged securities at fair value
280,916
298,471
211,468
288,134
342,979
FHLB borrowing capacity
1,311,091
1,542,459
1,358,650
1,528,978
1,217,516
Brokered deposits (Company policy limit of 10%)
316,697
288,719
524,889
549,370
605,552
Bank and parent lines of credit
70,000
70,000
70,000
70,000
70,000
Federal Reserve - Discount Window and BTFP (4)
471,395
491,141
129,918
44,471
-
Total
$
2,567,596
$
2,812,517
$
2,451,952
$
2,609,113
$
2,341,039
Total liquidity to adjusted uninsured deposits ratio
204.0
%
230.5
%
183.2
%
168.9
%
155.4
%
(1) Adjusted for collateralized deposits, other insured
deposits and intra-company accounts. (2) Mark-to-market included in
accumulated other comprehensive income. (3) Mark-to-market included
in net income each quarter. (4) Includes borrowing capacity related
to unpledged securities at par value in excess of fair value under
Bank Term Funding Program.
Premier Financial Corp. Loans
and Capital (dollars in thousands)
9/30/23 6/30/23
3/31/23 12/31/22 9/30/22
Loan Portfolio Composition
Residential real estate
$
1,797,676
$
1,711,632
$
1,624,331
$
1,535,574
$
1,478,360
Residential real estate construction
51,637
111,708
141,209
176,737
119,204
Total residential loans
1,849,313
1,823,340
1,765,540
1,712,311
1,597,564
Commercial real estate
2,820,410
2,848,410
2,813,441
2,762,311
2,674,078
Commercial construction
502,502
472,328
440,510
428,743
398,044
Commercial excluding PPP
1,038,939
1,068,795
1,060,351
1,054,037
1,041,423
Core commercial loans (1)
4,361,851
4,389,533
4,314,302
4,245,091
4,113,545
Consumer direct/indirect
203,800
210,390
212,299
213,405
212,790
Home equity and improvement lines
269,053
272,792
271,676
277,613
272,367
Total consumer loans
472,853
483,182
483,975
491,018
485,157
Deferred loan origination fees
12,326
11,936
11,221
11,057
10,261
Core loans (1)
6,696,343
6,707,991
6,575,038
6,459,477
6,206,527
PPP loans
526
577
791
1,143
1,181
Total loans
$
6,696,869
$
6,708,568
$
6,575,829
$
6,460,620
$
6,207,708
Loans held for sale
$
135,218
$
128,079
$
119,631
$
115,251
$
129,142
Core residential loans (1)
1,984,531
1,951,419
1,885,171
1,827,562
1,726,706
Total loans including loans held for sale but excluding PPP
6,831,561
6,836,070
6,694,669
6,574,728
6,335,669
Undisbursed construction loan funds - residential
$
82,689
$
102,198
$
157,934
$
209,306
$
231,598
Undisbursed construction loan funds - commercial
284,610
353,455
446,294
463,469
493,199
Undisbursed construction loan funds - total
367,299
455,653
604,228
672,775
724,797
Total construction loans including undisbursed funds
$
921,438
$
1,039,689
$
1,185,947
$
1,278,255
$
1,242,045
Gross loans (2)
$
7,051,842
$
7,152,285
$
7,168,836
$
7,122,338
$
6,922,244
Fixed rate loans %
49.8
%
49.8
%
49.5
%
48.8
%
48.7
%
Floating rate loans %
15.8
%
15.9
%
13.4
%
14.3
%
16.0
%
Adjustable rate loans repricing within 1 year %
2.9
%
1.5
%
2.0
%
2.6
%
0.8
%
Adjustable rate loans repricing over 1 year %
31.5
%
32.8
%
35.1
%
34.3
%
34.5
%
Commercial Real Estate Loans Composition Non owner
occupied excluding office
$
1,023,585
$
1,012,400
$
947,442
$
934,760
$
905,512
Non owner occupied office
207,869
225,046
220,668
222,300
203,565
Owner occupied excluding office
597,303
603,650
609,203
578,514
570,662
Owner occupied office
106,761
107,240
109,014
108,087
105,224
Multifamily
627,602
633,909
661,996
660,823
637,701
Agriculture land
119,710
123,104
122,384
125,384
122,416
Other commercial real estate
137,580
143,061
142,734
132,443
128,998
Total commercial real estate loans
$
2,820,410
$
2,848,410
$
2,813,441
$
2,762,311
$
2,674,078
Capital Balances Total equity
$
919,567
$
936,971
$
914,450
$
887,721
$
864,960
Less: Regulatory goodwill and intangibles
303,740
304,818
330,711
331,981
332,839
Less: Accumulated other comprehensive income/(loss) ("AOCI")
(200,282
)
(168,721
)
(153,709
)
(173,460
)
(181,231
)
Common equity tier 1 capital ("CET1")
816,109
800,874
737,448
729,200
713,352
Add: Tier 1 subordinated debt
35,000
35,000
35,000
35,000
35,000
Tier 1 capital
851,109
835,874
772,448
764,200
748,352
Add: Regulatory allowances
80,791
80,812
80,003
78,780
76,530
Add: Tier 2 subordinated debt
50,000
50,000
50,000
50,000
50,000
Total risk-based capital
$
981,900
$
966,686
$
902,451
$
892,980
$
874,882
Total risk-weighted assets
$
7,364,534
$
7,381,940
$
7,370,704
$
7,355,979
$
7,385,877
Capital Ratios CET1 Ratio
11.08
%
10.85
%
10.01
%
9.91
%
9.66
%
CET1 Ratio including AOCI
8.36
%
8.56
%
7.92
%
7.55
%
7.20
%
Tier 1 Capital Ratio
11.55
%
11.32
%
10.48
%
10.39
%
10.13
%
Tier 1 Capital Ratio including AOCI
8.84
%
9.04
%
8.39
%
8.03
%
7.68
%
Total Capital Ratio
13.33
%
13.10
%
12.24
%
12.14
%
11.85
%
Total Capital Ratio including AOCI
10.61
%
10.81
%
10.16
%
9.78
%
9.39
%
(1) Core loans represents total loans excluding undisbursed
loan funds, deferred loan origination fees and PPP loans. Core
commercial loans represents total commercial real estate,
commercial and commercial construction excluding commercial
undisbursed loan funds, deferred loan origination fees and PPP
loans. Core residential loans represents total loans held for sale,
one to four family residential real estate and residential
construction excluding residential undisbursed loan funds and
deferred loan origination fees. (2) Gross loans represent total
loans including undisbursed construction funds but excluding
deferred loan origination fees.
Premier Financial Corp.
Loan Delinquency Information (dollars in thousands)
Total
Balance Current 30 to 89 days past due % of
Total Non Accrual Loans % of Total
September 30, 2023 One to four family residential real estate
$
1,797,676
$
1,778,106
$
7,857
0.44
%
$
11,713
0.65
%
Construction
921,438
921,438
-
0.00
%
-
0.00
%
Commercial real estate
2,820,410
2,809,421
24
0.00
%
10,965
0.39
%
Commercial
1,039,465
1,025,632
1,670
0.16
%
12,163
1.17
%
Home equity and improvement
269,053
263,806
3,471
1.29
%
1,776
0.66
%
Consumer finance
203,800
196,754
4,200
2.06
%
2,846
1.40
%
Gross loans
$
7,051,842
$
6,995,157
$
17,222
0.24
%
$
39,463
0.56
%
June 30, 2023 One to four family residential real estate
$
1,711,632
$
1,694,024
$
7,320
0.43
%
$
10,288
0.60
%
Construction
1,039,689
1,039,404
285
0.03
%
-
0.00
%
Commercial real estate
2,848,410
2,833,765
596
0.02
%
14,049
0.49
%
Commercial
1,069,372
1,057,057
4,290
0.40
%
8,025
0.75
%
Home equity and improvement
272,792
267,617
2,945
1.08
%
2,230
0.82
%
Consumer finance
210,390
204,404
3,587
1.70
%
2,399
1.14
%
Gross loans
$
7,152,285
$
7,096,271
$
19,023
0.27
%
$
36,991
0.52
%
September 30, 2022 One to four family residential real
estate
$
1,478,360
$
1,464,319
$
6,232
0.42
%
$
7,809
0.53
%
Construction
1,242,045
1,242,045
-
0.00
%
-
0.00
%
Commercial real estate
2,674,078
2,660,068
116
0.00
%
13,894
0.52
%
Commercial
1,042,604
1,034,898
338
0.03
%
7,368
0.71
%
Home equity and improvement
272,367
267,077
3,144
1.15
%
2,146
0.79
%
Consumer finance
212,790
207,453
3,417
1.61
%
1,920
0.90
%
Gross loans
$
6,922,244
$
6,875,860
$
13,247
0.19
%
$
33,137
0.48
%
Loan Risk Ratings Information (dollars in thousands)
Total Balance Pass Rated Special Mention %
of Total Classified % of Total September
30, 2023 One to four family residential real estate
$
1,786,659
$
1,775,530
$
422
0.02
%
$
10,707
0.60
%
Construction
921,438
913,605
7,833
0.85
%
-
0.00
%
Commercial real estate
2,819,121
2,738,398
54,523
1.93
%
26,200
0.93
%
Commercial
1,034,943
982,927
31,930
3.09
%
20,086
1.94
%
Home equity and improvement
267,106
265,975
-
0.00
%
1,131
0.42
%
Consumer finance
203,584
200,965
-
0.00
%
2,619
1.29
%
PCD loans
18,991
13,374
2,814
14.82
%
2,803
14.76
%
Gross loans
$
7,051,842
$
6,890,774
$
97,522
1.38
%
$
63,546
0.90
%
June 30, 2023 One to four family residential real estate
$
1,700,468
$
1,689,666
$
484
0.03
%
$
10,318
0.61
%
Construction
1,039,689
1,031,356
8,333
0.80
%
-
0.00
%
Commercial real estate
2,847,035
2,797,688
20,751
0.73
%
28,596
1.00
%
Commercial
1,063,744
1,021,403
27,376
2.57
%
14,965
1.41
%
Home equity and improvement
270,722
269,038
-
0.00
%
1,684
0.62
%
Consumer finance
210,158
207,963
-
0.00
%
2,195
1.04
%
PCD loans
20,469
13,981
3,786
18.50
%
2,702
13.20
%
Gross loans
$
7,152,285
$
7,031,095
$
60,730
0.85
%
$
60,460
0.85
%
September 30, 2022 One to four family residential real
estate
$
1,466,470
$
1,458,082
$
1,267
0.09
%
$
7,121
0.49
%
Construction
1,242,045
1,240,745
1,300
0.10
%
-
0.00
%
Commercial real estate
2,672,451
2,584,984
65,233
2.44
%
22,234
0.83
%
Commercial
1,036,441
1,009,384
20,106
1.94
%
6,951
0.67
%
Home equity and improvement
269,786
268,384
-
0.00
%
1,402
0.52
%
Consumer finance
212,493
210,602
-
0.00
%
1,891
0.89
%
PCD loans
22,558
17,044
93
0.41
%
5,421
24.03
%
Gross loans
$
6,922,244
$
6,789,225
$
87,999
1.27
%
$
45,020
0.65
%
Premier Financial Corp. Mortgage and Credit
Information (dollars in thousands)
As of and for the Three
Months Ended Nine Months Ended Mortgage Banking
Summary 9/30/23 6/30/23 3/31/23 12/31/22 9/30/22
9/30/23 9/30/22 Revenue from sales and servicing of mortgage
loans: Mortgage banking gains, net
$
2,584
$
2,242
$
(837
)
$
(1,285
)
$
3,363
$
3,989
$
7,072
Mortgage loan servicing revenue (expense): Mortgage loan servicing
revenue
1,850
1,845
1,888
1,862
1,861
5,583
5,602
Amortization of mortgage servicing rights
(1,291
)
(1,277
)
(1,219
)
(1,271
)
(1,350
)
(3,787
)
(4,128
)
Mortgage servicing rights valuation adjustments
131
130
(106
)
396
96
155
1,624
690
698
563
987
607
1,951
3,098
Total revenue from sale/servicing of mortgage loans
$
3,274
$
2,940
$
(274
)
$
(298
)
$
3,970
$
5,940
$
10,170
Mortgage servicing rights: Balance at beginning of period
$
20,823
$
21,447
$
21,858
$
21,915
$
21,872
$
21,858
$
22,244
Loans sold, servicing retained
642
653
808
1,214
1,393
2,103
3,799
Amortization
(1,291
)
(1,277
)
(1,219
)
(1,271
)
(1,350
)
(3,787
)
(4,128
)
Balance at end of period
20,174
20,823
21,447
21,858
21,915
20,174
21,915
Valuation allowance: Balance at beginning of period
(663
)
(793
)
(687
)
(1,083
)
(1,179
)
(687
)
(2,707
)
Impairment recovery (charges)
131
130
(106
)
396
96
155
1,624
Balance at end of period
(532
)
(663
)
(793
)
(687
)
(1,083
)
(532
)
(1,083
)
Net carrying value at end of period
$
19,642
$
20,160
$
20,654
$
21,171
$
20,832
$
19,642
$
20,832
Allowance for credit losses - loans Beginning
allowance
$
75,921
$
74,273
$
72,816
$
70,626
$
67,074
$
72,816
$
66,468
Provision (benefit) for credit losses - loans
245
1,410
3,944
3,020
3,706
5,599
9,483
Net recoveries (charge-offs)
347
238
(2,487
)
(830
)
(154
)
(1,902
)
(5,325
)
Ending allowance
$
76,513
$
75,921
$
74,273
$
72,816
$
70,626
$
76,513
$
70,626
Total loans
$
6,696,869
$
6,708,568
$
6,575,829
$
6,460,620
$
6,207,708
Less: PPP loans
(526
)
(577
)
(791
)
(1,143
)
(1,181
)
Total loans ex PPP
$
6,696,343
$
6,707,991
$
6,575,038
$
6,459,477
$
6,206,527
Allowance for credit losses (ACL)
$
76,513
$
75,921
$
74,273
$
72,816
$
70,626
Add: Unaccreted purchase accounting marks
1,526
1,901
2,301
2,706
3,291
Adjusted ACL
$
78,039
$
77,822
$
76,574
$
75,522
$
73,917
ACL/Loans
1.14
%
1.13
%
1.13
%
1.13
%
1.14
%
Adjusted ACL/Loans ex PPP
1.17
%
1.16
%
1.16
%
1.17
%
1.19
%
Credit Quality Total non-performing loans (1)
$
39,463
$
36,991
$
34,377
$
33,822
$
33,137
Real estate owned (REO)
387
561
393
619
416
Total non-performing assets (2)
$
39,850
$
37,552
$
34,770
$
34,441
$
33,553
Net charge-offs (recoveries)
(347
)
(238
)
2,487
830
154
Allowance for credit losses / non-performing assets
192.00
%
202.18
%
213.61
%
211.42
%
210.49
%
Allowance for credit losses / non-performing loans
193.89
%
205.24
%
216.05
%
215.29
%
213.13
%
Non-performing assets / loans plus REO
0.60
%
0.56
%
0.53
%
0.53
%
0.54
%
Non-performing assets / total assets
0.47
%
0.44
%
0.41
%
0.41
%
0.41
%
Net charge-offs (recoveries) / average loans
-0.02
%
-0.01
%
0.15
%
0.05
%
0.01
%
Net charge-offs (recoveries) / average loans LTM
0.04
%
0.14
%
0.14
%
0.10
%
0.26
%
(1) Non-performing loans consist of non-accrual loans. (2)
Non-performing assets are non-performing loans plus real estate and
other assets acquired by foreclosure or deed-in-lieu thereof.
Premier Financial Corp. Non-GAAP Reconciliations
Three Months Ended Nine Months Ended (In thousands,
except per share and ratio data)
9/30/23 6/30/23 3/31/23
12/31/22 9/30/22
9/30/23 9/30/22 Total non-interest expenses
$
38,052
$
44,495
$
42,791
$
43,028
$
41,099
$
125,338
$
121,483
Less: Transaction costs (pre-tax)
-
3,652
-
-
-
3,652
-
Core non-interest expenses
$
38,052
$
40,843
$
42,791
$
43,028
$
41,099
$
121,686
$
121,483
Non-interest income
$
13,253
$
53,346
$
12,462
$
14,228
$
16,704
$
79,061
$
47,932
Less: Gain on sale of insurance agency (pre-tax)
-
36,296
-
-
-
36,296
-
Core non-interest income
$
13,253
$
17,050
$
12,462
$
14,228
$
16,704
$
42,765
$
47,932
Less: Securities gains (losses)
256
64
(1,411
)
1,210
43
(1,091
)
(1,760
)
Core non-interest income (ex securities gains/losses)
$
12,997
$
16,986
$
13,873
$
13,018
$
16,661
$
43,856
$
49,692
Tax-equivalent net interest income
$
54,318
$
54,059
$
56,391
$
62,783
$
63,509
$
164,768
$
180,952
Core non-interest income (ex securities gains/losses)
12,997
16,986
13,873
13,018
16,661
43,856
49,692
Total core revenues
67,315
71,045
70,264
75,801
80,170
208,624
230,644
Core non-interest expenses
$
38,052
$
40,843
$
42,791
$
43,028
$
41,099
$
121,686
$
121,483
Core efficiency ratio
56.53
%
57.49
%
60.90
%
56.76
%
51.26
%
58.33
%
52.67
%
Income (loss) before income taxes
$
30,238
$
62,303
$
22,252
$
31,045
$
34,905
$
114,793
$
95,236
Add: Provision (benefit) for credit losses
(773
)
540
3,706
2,774
4,012
3,473
11,513
Pre-tax pre-provision income
29,465
62,843
25,958
33,819
38,917
118,266
106,749
Add: Transaction costs (pre-tax)
-
3,652
-
-
-
3,652
-
Less: Gain on sale of insurance agency (pre-tax)
-
36,296
-
-
-
36,296
-
Core pre-tax pre-provision income
$
29,465
$
30,199
$
25,958
$
33,819
$
38,917
$
85,622
$
106,749
Average total assets
$
8,582,219
$
8,597,786
$
8,433,100
$
8,304,462
$
8,161,389
$
8,538,248
$
7,807,013
Core pre-tax pre-provision return on average assets
1.36
%
1.41
%
1.25
%
1.62
%
1.89
%
1.34
%
1.83
%
Net income (loss)
$
24,687
$
48,391
$
18,149
$
25,275
$
28,195
$
91,227
$
76,912
Less: Gain on sale of insurance agency (pre-tax)
-
36,296
-
-
-
36,296
-
Add: Transaction costs (pre-tax)
-
3,652
-
-
-
3,652
-
Add: Tax impact of sale transaction
-
8,483
-
-
-
8,483
-
Core net income
$
24,687
$
24,230
$
18,149
$
25,275
$
28,195
$
67,066
$
76,912
Diluted shares - Reported
35,794
35,800
35,719
35,790
35,704
35,769
35,818
Core diluted EPS
$
0.69
$
0.68
$
0.51
$
0.71
$
0.79
$
1.87
$
2.15
Average total assets
$
8,582,219
$
8,597,786
$
8,433,100
$
8,304,462
$
8,161,389
$
8,538,248
$
7,807,013
Core return on average assets
1.14
%
1.13
%
0.87
%
1.21
%
1.37
%
1.05
%
1.32
%
Average total equity
$
939,456
$
921,441
$
901,587
$
875,287
$
912,224
$
920,967
$
945,141
Core return on average equity
10.43
%
10.55
%
8.16
%
11.46
%
12.26
%
9.74
%
10.88
%
Average total tangible equity
$
630,126
$
586,579
$
565,169
$
538,080
$
573,641
$
594,196
$
605,195
Core return on average tangible equity
15.54
%
16.57
%
13.02
%
18.64
%
19.50
%
15.09
%
16.99
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231024691802/en/
Paul Nungester EVP and CFO 419.785.8700
PNungester@yourpremierbank.com
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