Stock Yards Bancorp, Inc. (NASDAQ: SYBT), parent company of
Stock Yards Bank & Trust Company, with offices in the
Louisville, Indianapolis and Cincinnati metropolitan markets, today
reported results for the first quarter ended March 31, 2019. Total
revenue, comprising net interest income and non-interest income,
increased 7% to $40.7 million for the first quarter of 2019 from
$38.2 million for the first quarter of 2018. Net income before
income taxes increased 6% to $17.5 million for the first quarter of
2019 from $16.5 million for the year-earlier quarter. Net income
for the first quarter of 2019, which includes a state income tax
benefit discussed below, rose 17% to $15.6 million or $0.68 per
diluted share from $13.4 million or $0.58 per diluted share for the
first quarter of 2018.
(dollar
amounts in thousands, except per share data)
1Q19
4Q18 1Q18 Net interest income $ 29,657 $ 29,912 $
27,309 Provision for loan and lease losses 600 - 735 Non-interest
income 11,062 11,576 10,909 Non-interest expenses 22,639
24,565 21,027 Income before
income tax expense 17,480 16,293 16,456 Income tax expense
1,839 2,265 3,052 Net income $
15,641 $ 14,658 $ 13,404 Net income per share,
diluted $ 0.68 $ 0.64 $ 0.58 Net interest margin 3.89 % 3.84 % 3.79
% Efficiency ratio 55.52 % 59.12 % 54.89 % Common equity Tier 1
capital ratio 13.11 % 13.00 % 12.16 % Annualized return on average
equity 17.09 % 16.23 % 16.15 % Annualized return on average assets
1.94 % 1.78 % 1.76 %
Key factors affecting the Company's results for the first
quarter of 2019 included:
- Average loans increased $88.2 million
year over year, contributing to an 18% increase in interest income
on a comparable quarter basis, while total average deposits
increased 7% to support loan growth;
- Continued robust loan production was
offset by a high level of loan payoffs;
- Net interest margin rose 10 basis
points compared with the same quarter of 2018 consistent with
higher yields on loans, loan prepayment penalties and an increase
in non-interest bearing deposits;
- Credit quality metrics remained strong,
as the Company experienced its second consecutive quarter of net
loan loss recoveries;
- The Wealth Management and Trust Group
(WM&T) posted consistent performance against a strong first
quarter last year;
- Card income and Treasury Management
fees, bolstered by increased usage and expanding customer bases,
continue to stand out as diversifying revenue streams; and
- The effective income tax rate declined
to 10.5% primarily due to the recognition of a state deferred tax
asset related to the repeal of the Kentucky Franchise Tax as of
2021, the effect of which added $0.06 to net income per diluted
share for the first quarter 2019.
"Stock Yards Bancorp registered another strong quarter with the
opening of 2019," said James A. (Ja) Hillebrand, Chief Executive
Officer. "Key elements supporting the Company's results included
near-record loan production during the quarter paired with solid
year-over-year growth in average loans and deposits, the
continuation of very sound credit quality metrics, and an ongoing
improvement in net interest margin. These positive factors not only
helped us again achieve record earnings, both before and after
income tax expense, they also underscored the substantial and
fundamental strength of our business model. The Company's history
of success and consistent performance owes much to a diversified
revenue stream that emanates from the broad range of products and
services we offer, along with the geographic diversification we
have achieved by expansion to two major metro markets. These
strategies, and our successful implementation of them, continue to
differentiate Stock Yards Bancorp among community bank peers and
provide us with a solid platform from which to grow.
"Loan production in the first quarter of 2019 was very strong,
among the best quarterly performances in our company's history, yet
we also encountered a record level of loan payoffs – mainly related
to collateral sales – that offset that progress," Hillebrand
continued. "A familiar trend over the past few years and a natural
aspect of a buoyant economy, high loan payoffs reflect attractive
opportunities for our customers to monetize assets through
opportunistic asset sales. Additionally, we are seeing aggressive
permanent financing competition from non-traditional lending
institutions. However, we remain focused on the formation of
lasting customer relationships – building one relationship at a
time – that frequently span multiple generations. Considering our
historic focus on these core areas, we recognize the pattern of
payoffs that come with this territory and know the opportunities as
well. We value the chance to develop long-lasting client
associations that entail both lending and deposits, which helps us
retain customers across economic cycles like we see now."
Hillebrand noted that while the Company has achieved exceptional
loan production in pursuit of prudent growth in a competitive
environment, it also remains committed to a conservative credit
quality culture, as evidenced by key metrics that remain at
historically strong levels.
As to revenue diversity, Hillebrand pointed out that the
WM&T Group, which has $3.0 billion of assets under management,
provided 49% of the Company's non-interest income for the first
quarter of 2019. Against a strong first quarter of 2018, WM&T
again posted solid results and enjoyed ongoing new business
acquisition. Also, revenue from debit and credit cards, along with
treasury management fees, combined to account for 26% of first
quarter non-interest income. These diverse sources remain key to
long-term stability in revenue growth by offsetting soft conditions
that occur in other areas, like those currently experienced in
mortgage banking, which faces a continued industry-wide slowdown
due to higher rates and a tight housing market.
Hillebrand also noted that the Company remains on track to
complete the acquisition of King Bancorp and its subsidiary King
Southern Bank on the close of business April 30, 2019. The
transaction, which will add customers in the Louisville market and
extend the Company's reach to neighboring Nelson County, has
received regulatory approval and remains subject only to customary
closing conditions.
"As we have previously disclosed, Executive Vice President and
Chief Financial Officer Nancy Davis will retire from the Company on
April 30, 2019. On behalf of the Board of Directors and everyone at
Stock Yards Bancorp, I would like to thank Nancy for the
significant contributions she has made to the Company over her
27-year tenure, helping us grow from $222 million in assets in 1991
to $3.3 billion in assets today. Nancy has played a vital role in
our growth and success, positioning us among the strongest and
highest performing community banks in the nation. We wish Nancy
nothing but the best in her retirement.”
In closing, Hillebrand said, "Our outstanding results for the
first quarter reflect both the vibrant economies within our
footprint and our solid execution of long-term strategies. Equally
important are the hard work and dedication put forth by our team in
delivering an unrivaled banking experience for our customers, and
for this I am grateful. We look toward the remainder of the year
with a sense of confidence and optimism, supported by attractive
business fundamentals, a strong loan production pipeline and the
opportunity to welcome new customers from King Southern Bank with a
broader range of services. Considering these factors, we remain
well positioned to extend our track record of top- and bottom-line
growth in 2019."
First Quarter 2019 Compared with First
Quarter 2018
Total assets remained level at $3.3 billion.
- This was primarily due to a 0.5%
increase in the Company's loan portfolio, which rose $13.3
million.
Total deposits increased $179.2 million or 7% to $2.8
billion.
- This primarily reflected an increase in
time deposits and demand deposits.
- Core deposits, which exclude brokered
deposits and time deposits greater than $250,000, represented 97%
of total deposits.
Asset quality, which has remained exceptional and has trended
within a narrow range over the past several years, remains strong.
While the Company is pleased with this performance, management
recognizes the cyclical nature of banking and believes asset
quality metrics will normalize over the long term, which will
eventually result in higher provisioning for loan and lease
losses.
- Non-performing loans (NPLs) were $3.8
million or 0.15% of total loans outstanding versus $12.3 million or
0.49% of total loans outstanding.
- Non-performing assets (NPAs), which
include NPLs along with other real estate owned and repossessed
assets, were $4.6 million or 0.14% of total assets versus $12.6
million or 0.38% of total assets.
- Based on a net loan loss recovery of
$330 thousand versus net charge-offs of $1.4 million in the first
quarter of 2018, combined with other considerations, including the
overall level of risk in the portfolio, the Company provided $600
thousand for loan and lease losses in the first quarter of 2019
versus $735 thousand in the first quarter of 2018.
- The allowance for loan and lease losses
relative to total end-of-period loans increased nine basis points
to 1.05% from 0.96%.
The Company remained "well capitalized" – the highest capital
rating for financial institutions.
- Total equity to assets was 11.52% and
tangible common equity ratio was 11.47%, both improving from 10.28%
and 10.23%, respectively (tangible common equity is a non-GAAP
financial measure (2)).
- Even with its strong capital position,
the Company continues to consistently achieve industry-leading
returns on equity due to its superior earnings performance.
- Stock Yards Bancorp continues to pursue
and consider strategies to enhance stockholder value, including a
substantial and sustained dividend payout ratio. In February 2019,
the Company's Board of Directors continued the higher rate of $0.25
per common share initially set in August 2018. With the August
increase, Stock Yards Bancorp has raised its quarterly dividend
rate a total of 11 times since 2013, including two increases during
2018 and each of the previous four years.
- The Company also opportunistically
pursues strategic fill-in or adjacent-market acquisitions to
augment organic growth and its capital allocation strategies. In
December 2018, the Company announced its planned acquisition of
King Bancorp, the holding company for King Southern Bank.
Net interest income – the Company's largest source of revenue –
increased approximately $2.3 million or 9% to $29.7 million.
- Interest income rose $5.3 million or
18%. This increase was primarily driven by higher market interest
rates and average loan volumes;
- As anticipated, interest expense
increased 121% during the first quarter due to growth of deposits –
primarily time deposits – resulting from a deposit-gathering
campaign last year, along with higher costs on those deposits. That
campaign, together with ongoing competition for deposits, could
cause funding costs to increase further in 2019.
- Net interest margin increased 10 basis
points to 3.89%. This primarily reflected the positive impact of
increases in the prime rate, which was 75 basis points higher in
the first quarter of 2019 versus the same period of 2018 and higher
loan prepayment penalties;
- Approximately 40% of the Company's
current loan portfolio is priced at variable rates, so any future
rate increases will benefit this part of the portfolio. The
remainder of the portfolio is priced at fixed rates. As these loans
renew and the Bank originates new fixed-rate loans, pricing could
be higher, but pricing will be subject to competitive conditions,
prevailing interest rates and a flattening or inverted yield
curve.
Non-interest income increased $153 thousand or 1.4% to $11.1
million.
- Increases in fees from debit and credit
cards, treasury management fees, as well as other non-interest
income were partially offset by lower deposit service charges,
mortgage banking income, as well as a slight decrease in WM&T
service fees.
Non-interest expenses increased $1.6 million or 8% to $22.6
million.
- The increase primarily reflected an
increase in compensation expenses resulting from the addition of
new employees to support growth and regular annual salary
increases;
- Technology and communication expenses
increased due to ongoing investments in hardware and software, as
well as higher processing fees for debit and credit cards that
mirror growing fee income from debit and credit cards;
- Other non-interest expense increased
primarily because of a gain on the sale of other real estate owned
that was included in the first quarter of 2018.
The Company's effective tax rate declined to 10.5% from 18.5%
primarily because of the recognition of a state deferred tax asset
following legislative action to repeal of the Kentucky Franchise
Tax in 2021.
- Beginning in 2021, Kentucky franchise
tax will be replaced with an income-based tax at a rate of 5%,
which is expected to result in higher state taxes to the Company
compared with the former capital-based franchise tax that has been
historically included in non-interest expenses.
First Quarter 2019 Compared with Fourth
Quarter 2018
Total loans declined $22 million or 1%.
- Strong loan production in the first
quarter of 2019 was more than offset by a historic level of loan
payoffs.
Total deposits decreased $42 million or 2%.
- This primarily was due to a seasonal
decrease in interest bearing and non-interest bearing demand
deposits.
Asset quality remained at historically strong levels.
- NPLs were $3.8 million or 0.15% of
total loans outstanding versus $3.4 million or 0.13% of total loans
outstanding.
- NPAs were $4.6 million or 0.14% of
total assets versus $4.4 million or 0.13% of total assets.
- Net loan loss recoveries were $330
thousand versus $312 thousand, the second consecutive quarter of
net recoveries.
- The Company recorded a provision for
loan and lease losses of $600 thousand; there was no provision in
the fourth quarter of 2018.
- The allowance for loan and lease losses
relative to total end-of-period loans was 1.05%, an increase of
five basis points from the fourth quarter of 2018.
Net interest income declined 1%.
- Interest income rose $25 thousand or
0.1%.
- Interest expense rose $280 thousand or
6% primarily due to higher funding costs.
- Net interest margin increased five
basis points to 3.89%.
Non-interest income decreased 4%.
- Increases in WM&T service fees and
other non-interest income were offset by declines in deposit
service charges, treasury management fees and bank owned life
insurance, with the prior quarter reflecting the rare receipt of
life insurance proceeds.
Non-interest expenses declined 8%.
- This decrease reflected primarily lower
amortization/impairment of investments in tax credit partnerships
caused by the irregular timing of such opportunities, which causes
corresponding expenses and tax benefits to vary widely, along with
lower legal and professional fees.
About the Company
Louisville, Kentucky-based Stock Yards Bancorp, Inc., with $3.3
billion in assets, was incorporated in 1988 as a bank holding
company. It is the parent company of Stock Yards Bank & Trust
Company, which was established in 1904. The Company's common shares
trade on the NASDAQ Global Select Market under the symbol SYBT.
This report contains forward-looking statements under the
Private Securities Litigation Reform Act that involve risks and
uncertainties. Although the Company's management believes the
assumptions underlying the forward-looking statements contained
herein are reasonable, any of these assumptions could be
inaccurate. Therefore, there can be no assurance the
forward-looking statements included herein will prove to be
accurate. Factors that could cause actual results to differ from
those discussed in forward-looking statements include, but are not
limited to: economic conditions both generally and more
specifically in the markets in which the Company and its subsidiary
operates; competition for the Company's customers from other
providers of financial services; government legislation and
regulation, which change and over which the Company has no control;
changes in interest rates; material unforeseen changes in
liquidity, results of operations, or financial condition of the
Company's customers; and other risks detailed in the Company's
filings with the Securities and Exchange Commission, all of which
are difficult to predict and many of which are beyond the control
of the Company. See Risk Factors outlined in the Company's Form
10-K for the year ended December 31, 2018. Additionally, these
forward-looking statements include, but are not limited to,
statements relating to the expected timing and benefits of the
proposed acquisition of King Bancorp, Inc., including future
financial and operating results, cost savings, enhanced revenues,
and accretion/dilution to reported earnings that may be realized
from the acquisition, as well as other statements of expectations
regarding the acquisition and other statements of goals, intentions
and expectations; statements regarding its business plan and growth
strategies; statements regarding the asset quality of King
Bancorp's loan and investment portfolios; and estimates of
King Bancorp's risks and future costs and benefits, whether with
respect to the acquisition or otherwise.
Stock Yards Bancorp, Inc. Financial
Information (unaudited) First Quarter 2019 Earnings
Release (In thousands unless otherwise noted)
Three Months Ended March
31, Income Statement Data 2019
2018 Net interest income, fully tax equivalent (1) $
29,713 $ 27,402 Interest income: Loans and leases $ 31,544 $ 27,062
Federal funds sold and interest bearing due from banks 733 268
Mortgage loans held for sale 37 35 Securities 2,715
2,379 Total interest income 35,029 29,744 Interest
expense: Deposits 5,066 2,077
Securities sold under agreements to
repurchase and other short-term borrowings
85 123 Federal Home Loan Bank (FHLB) advances 221 235
Total interest expense 5,372 2,435 Net interest
income 29,657 27,309 Provision for loan and lease losses 600
735 Net interest income after provision for loan and lease
losses 29,057 26,574 Non-interest income: Wealth
management and trust services 5,439 5,500 Deposit service charges
1,247 1,411 Debit and credit card income 1,744 1,508 Treasury
management fees 1,157 1,047 Mortgage banking income 482 576 Net
investment product sales commissions and fees 356 404 Bank owned
life insurance 178 187 Other 459 276 Total
non-interest income 11,062 10,909 Non-interest
expenses: Compensation 11,801 10,970 Employee benefits 2,642 2,633
Net occupancy and equipment 1,858 1,818 Technology and
communication 1,773 1,630 Debit and credit card processing 587 566
Marketing and business development 625 646 Postage, printing, and
supplies 406 391 Legal and professional 534 493 FDIC insurance 238
242 Amortization/impairment of investments in tax credit
partnerships 52 - Capital and deposit based taxes 904 852 Other
1,219 786 Total non-interest expenses 22,639
21,027 Income before income tax expense 17,480 16,456 Income
tax expense 1,839 3,052 Net income $ 15,641 $ 13,404
Net income per share, basic $ 0.69 $ 0.59 Net income per
share, diluted 0.68 0.58 Cash dividend declared per share 0.25 0.23
Weighted average shares - basic 22,661 22,577 Weighted
average shares - diluted 22,946 22,931
March 31,
Balance Sheet Data 2019
2018 Loans and leases $ 2,525,709 $ 2,512,388
Allowance for loan and lease losses 26,464 24,203 Total assets
3,281,016 3,285,480 Non-interest bearing deposits 698,783 681,936
Interest bearing deposits 2,053,757 1,891,428 FHLB advances 47,853
49,140 Stockholders' equity 377,994 337,702 Total shares
outstanding 22,823 22,730 Book value per share (2) $ 16.56 $ 14.86
Tangible common equity per share (2) 16.49 15.44 Market value per
share 33.81 35.10
Stock Yards Bancorp, Inc.
Financial Information (unaudited) First Quarter 2019
Earnings Release
Three Months Ended March 31, Average Balance Sheet
Data 2019 2018 Federal funds
sold and interest bearing due from banks $ 122,189 $ 71,186
Mortgage loans held for sale 1,727 2,098 Securities available for
sale 437,619 417,708 FHLB stock and other securities 10,192 7,687
Loans and leases 2,538,940 2,450,703 Total earning assets 3,100,352
2,931,338 Total assets 3,271,258 3,090,891 Interest bearing
deposits 2,048,830 1,893,256 Total deposits 2,743,701 2,563,184
Securities sold under agreement to
repurchase other short-term borrowings
48,956 97,535 FHLB advances 47,962 49,247 Total interest bearing
liabilities 2,145,748 2,040,038 Total stockholders' equity 371,070
336,570
Performance Ratios Annualized return on
average assets 1.94 % 1.76 % Annualized return on average equity
17.09 % 16.15 % Net interest margin, fully tax equivalent 3.89 %
3.79 %
Non-interest income to total revenue,
fully tax equivalent
27.13 % 28.47 % Efficiency ratio, fully tax equivalent (3) 55.52 %
54.89 %
Capital Ratios Total stockholders' equity to
total assets (2) 11.52 % 10.28 % Tangible common equity to tangible
assets (2) 11.47 % 10.23 % Average stockholders' equity to average
assets 11.34 % 10.89 % Total risk-based capital 14.04 % 13.04 %
Common equity tier 1 capital 13.11 % 12.16 % Tier 1 risk-based
capital 13.11 % 12.16 % Leverage 11.57 % 11.05 %
Loans by
Type Commercial and industrial $ 827,747 $ 843,478 Construction
and land development 244,548 235,872 Real estate mortgage -
commercial investment 586,648 590,942 Real estate mortgage - owner
occupied commercial 428,163 407,733 Real estate mortgage - 1-4
family residential 277,847 272,900 Home equity - first lien 48,656
51,595 Home equity - junior lien 66,837 64,108 Consumer
45,263 45,760 Total loans and leases $
2,525,709 $ 2,512,388
Asset Quality
Data Allowance for loan and lease losses to total loans 1.05 %
0.96 % Allowance for loan and lease losses to average loans 1.04 %
0.99 % Allowance for loan and lease losses to non-performing loans
634 % 197 % Non-accrual loans $ 3,273 $ 11,422 Troubled debt
restructurings 39 843 Loans past due 90 days or more and still
accruing 454 - Total non-performing loans 3,766 12,265 Other real
estate owned 878 360 Total non-performing assets 4,644 12,625
Non-performing loans to total loans 0.15 % 0.49 % Non-performing
assets to total assets 0.14 % 0.38 % Net charge-offs (recoveries) $
(330 ) $ 1,417 Net charge-offs (recoveries) to average loans (4)
-0.01 % 0.06 %
Stock Yards Bancorp, Inc. Financial
Information (unaudited)First Quarter 2019 Earnings
Release
Quarterly
Comparison Income Statement Data 3/31/19
12/31/18 9/30/18
6/30/18 3/31/18 Net interest
income, fully tax equivalent (1) $ 29,713 $ 29,972 $
28,590 $ 28,759 $ 27,402 Net interest income $
29,657 $ 29,912 $ 28,521 $ 28,674 $ 27,309 Provision for loan and
lease losses 600 - 735
1,235 735 Net interest income after
provision for loan and lease losses 29,057
29,912 27,786 27,439
26,574 Non-interest income: Wealth management and trust
services 5,439 5,312 5,380 5,344 5,500 Deposit service charges
1,247 1,419 1,482 1,447 1,411 Debit and credit card income 1,744
1,813 1,759 1,689 1,508 Treasury management fees 1,157 1,260 1,151
1,113 1,047 Mortgage banking income 482 534 712 746 576 Net
investment product sales commissions and fees 356 432 444 397 404
Bank owned life insurance 178 565 186 191 187 Other 459
241 312 508
276 Total non-interest income 11,062
11,576 11,426 11,435
10,909 Non-interest expenses: Compensation 11,801 11,824
11,607 11,703 10,970 Employee benefits 2,642 2,452 2,501 2,512
2,633 Net occupancy and equipment 1,858 2,110 1,914 1,811 1,818
Technology and communication 1,773 1,660 1,595 1,685 1,630 Debit
and credit card processing 587 594 588 579 566 Marketing and
business development 625 908 740 805 646 Postage, printing, and
supplies 406 397 370 400 391 Legal and professional 534 1,116 501
504 493 FDIC insurance 238 243 238 238 242
Amortization/impairment of investments in
tax credit partnerships
52 1,179 - 58 - Capital and deposit based taxes 904 873 738 862 852
Other 1,219 1,209 989
979 786 Total non-interest expenses
22,639 24,565 21,781
22,136 21,027 Income before income tax
expense 17,480 16,923 17,431 16,738 16,456 Income tax expense
1,839 2,265 3,555
3,159 3,052 Net income $ 15,641 $
14,658 $ 13,876 $ 13,579 $ 13,404
Net income per share, basic $ 0.69 $ 0.65 $ 0.61 $ 0.60 $
0.59 Net income per share, diluted 0.68 0.64 0.60 0.59 0.58 Cash
dividend declared per share 0.25 0.25 0.25 0.23 0.23
Weighted average shares - basic 22,661 22,638 22,636 22,625 22,577
Weighted average shares - diluted 22,946 22,907 22,968 22,979
22,931
Quarterly Comparison Balance Sheet Data
3/31/19 12/31/18 9/30/18 6/30/18
3/31/18 Cash and due from banks $ 44,014 $ 51,892 $
66,029 $ 44,052 $ 41,622 Federal funds sold and interest bearing
due from banks 67,326 147,047 54,451 10,948 15,254 Mortgage loans
held for sale 2,981 1,675 2,533 2,053 4,239 Securities available
for sale 507,131 436,995 550,091 574,570 598,081 FHLB stock and
other securities 9,779 10,370 10,370 10,370 8,876 Loans and leases
2,525,709 2,548,171 2,534,483 2,577,960 2,512,388 Allowance for
loan and lease losses 26,464 25,534 25,222 24,873 24,203 Total
assets 3,281,016 3,302,924 3,324,797 3,323,840 3,285,480
Non-interest bearing deposits 698,783 711,023 705,386 715,974
681,936 Interest bearing deposits 2,053,757 2,083,333 1,892,652
1,824,487 1,891,428 Securities sold under agreements to repurchase
34,633 36,094 53,883 58,808 67,892 Federal funds purchased and
other short-term borrowings 12,218 10,247 231,344 286,460 215,233
FHLB advances 47,853 48,177 48,500 48,821 49,140 Stockholders'
equity 377,994 366,500 352,980 345,515 337,702 Total shares
outstanding 22,823 22,749 22,746 22,746 22,730 Book value per share
(2) $ 16.56 $ 16.11 $ 15.52 $ 15.19 $ 14.86 Tangible common equity
per share (2) 16.49 16.03 15.44 15.11 14.78 Market value per share
33.81 32.80 36.30 38.15 35.10
Capital Ratios Total
stockholders' equity to total assets (2) 11.52 % 11.10 % 10.62 %
10.40 % 10.28 % Tangible common equity to tangible assets (2) 11.47
% 11.05 % 10.57 % 10.35 % 10.23 % Average stockholders' equity to
average assets 11.34 % 10.99 % 11.14 % 10.91 % 10.89 % Total
risk-based capital 14.04 % 13.91 % 13.50 % 13.06 % 13.04 % Common
equity tier 1 capital 13.11 % 13.00 % 12.61 % 12.18 % 12.16 % Tier
1 risk-based capital 13.11 % 13.00 % 12.61 % 12.18 % 12.16 %
Leverage 11.57 % 11.33 % 11.40 % 11.19 % 11.05 %
Stock Yards Bancorp, Inc. Financial Information
(unaudited) First Quarter 2019 Earnings Release
Quarterly Comparison Average Balance Sheet
Data 3/31/19 12/31/18 9/30/18
6/30/18 3/31/18 Federal funds sold and
interest bearing due from banks $ 122,189 $ 86,725 $ 73,196 $
36,985 $ 71,186 Mortgage loans held for sale 1,727 2,140 2,980
2,975 2,098 Investment securities 437,619 468,856 372,251 401,369
417,708 Loans and leases 2,538,940 2,539,750 2,547,474 2,540,537
2,450,703 Total earning assets 3,100,352 3,096,931 2,990,401
2,973,704 2,931,338 Total assets 3,271,258 3,260,322 3,153,406
3,132,494 3,090,891 Interest bearing deposits 2,048,830 2,012,489
1,874,853 1,846,730 1,893,256 Total deposits 2,743,701 2,738,678
2,590,156 2,548,372 2,563,185
Securities sold under agreement to
repurchase and other short-term borrowings
48,956 67,731 116,287 150,173 97,535 FHLB advances 47,962 48,287
48,612 48,929 49,247 Total interest bearing liabilities 2,145,748
2,128,507 2,039,752 2,045,832 2,040,038 Total stockholders' equity
371,070 358,293 351,376 341,637 336,570
Performance
Ratios Annualized return on average assets 1.94 % 1.78 % 1.75 %
1.74 % 1.76 % Annualized return on average equity 17.09 % 16.23 %
15.67 % 15.94 % 16.15 % Net interest margin, fully tax equivalent
3.89 % 3.84 % 3.79 % 3.88 % 3.79 %
Non-interest income to total revenue,
fully tax equivalent
27.13 % 27.86 % 28.55 % 28.45 % 28.47 % Efficiency ratio, fully tax
equivalent (3) 55.52 % 59.12 % 54.43 % 55.07 % 54.89 %
Loans by Type Commercial and industrial $ 827,747 $ 833,524
$ 816,252 $ 855,015 $ 843,478 Construction and land development
244,548 255,142 233,107 238,224 235,872 Real estate mortgage -
commercial investment 586,648 588,610 630,000 622,777 590,942 Real
estate mortgage - owner occupied commercial 428,163 426,373 420,098
420,999 407,733 Real estate mortgage - 1-4 family residential
277,847 276,017 274,409 277,735 272,900 Home equity - 1st lien
48,656 49,500 46,062 53,257 51,595 Home equity - junior lien 66,837
70,947 67,105 66,323 64,108 Consumer 45,263
48,058 47,450 43,630
45,760 Total loans and leases $ 2,525,709 $ 2,548,171
$ 2,534,483 $ 2,577,960 $ 2,512,388
Asset Quality Data Allowance for loan and lease
losses to total loans 1.05 % 1.00 % 1.00 % 0.96 % 0.96 % Allowance
for loan and lease losses to average loans 1.04 % 1.01 % 1.00 %
0.98 % 0.99 % Allowance for loan and lease losses to non-performing
loans 634 % 751 % 506 % 337 % 197 % Non-accrual loans $ 3,273 $
2,611 $ 3,982 $ 6,422 $ 11,422 Troubled debt restructurings 39 42
792 817 843 Loans past due 90 days or more and still accruing 454
745 212 134 - Total non-performing loans 3,766 3,398 4,986 7,373
12,265 Other real estate owned 878 1,018 1,604 360 360 Total
non-performing assets 4,644 4,416 6,590 7,733 12,625 Non-performing
loans to total loans 0.15 % 0.13 % 0.20 % 0.29 % 0.49 %
Non-performing assets to total assets 0.14 % 0.13 % 0.20 % 0.23 %
0.38 % Net charge-offs (recoveries) $ (330 ) $ (312 ) $ 386 $ 565 $
1,417 Net charge-offs (recoveries) to average loans (4) -0.01 %
-0.01 % 0.02 % 0.02 % 0.06 %
Other Information Total
assets under management (in millions) $ 2,970 $ 2,765 $ 2,969 $
2,852 $ 2,883 Full-time equivalent employees 596 591 593 581 589
(1) - Interest income on a fully tax equivalent basis includes the
additional amount of interest income that would have been earned if
investments in certain tax-exempt interest earning assets had been
made in assets subject to federal, state and local taxes yielding
the same after-tax income. (2) - The following table
provides a reconciliation of total stockholders’ equity in
accordance with U.S. Generally Accepted Accounting Principles
(“GAAP”) to tangible stockholders’ equity in accordance with
applicable regulatory requirements, a non-GAAP disclosure. The
Company provides the tangible book value per share, a non-GAAP
measure, in addition to those defined by banking regulators,
because of its widespread use by investors as a means to evaluate
capital adequacy.
Quarterly Comparison
3/31/19 12/31/18
9/30/18 6/30/18
3/31/18 Total stockholders equity - GAAP (a) $
377,994 $ 366,500 $ 352,980 $ 345,515 $ 337,702 Less: Goodwill (682
) (682 ) (682 ) (682 ) (682 ) Less: Core deposit intangible
(1,015 ) (1,057
) (1,098 )
(1,139 ) (1,182
) Tangible common equity - Non-GAAP (c)
$
376,297 $ 364,761
$ 351,200 $
343,694 $ 335,838
Total assets - GAAP (b) $ 3,281,016 $ 3,302,924 $
3,324,797 $ 3,323,840 $ 3,285,480 Less: Goodwill (682 ) (682 ) (682
) (682 ) (682 ) Less: Core deposit intangible
(1,015 ) (1,057
) (1,098 )
(1,139 ) (1,182
) Tangible assets - Non-GAAP (d)
$
3,279,319 $ 3,301,185
$ 3,323,017 $
3,322,019 $ 3,283,616
Total shareholders' equity to total assets - GAAP
(a/b) 11.52 % 11.10 % 10.62 % 10.40 % 10.28 % Tangible common
equity to tangible assets - Non-GAAP (c/d) 11.47 % 11.05 % 10.57 %
10.35 % 10.23 % Number of outstanding shares (e)
22,823 22,749
22,746 22,746
22,730 Book Value per Share - GAAP (a/e)
$ 16.56 $ 16.11 $ 15.52 $ 15.19 $ 14.86 Tangible Common Equity per
Share - Non GAAP (c/e) 16.49 16.03 15.44 15.11 14.78 (3) -
The efficiency ratio, a non-GAAP measure, equals total non interest
expense divided by the sum of fully tax equivalent net interest
income and non interest income. The ratio excludes net gains
(losses) on sales, calls, and impairment of investment securities,
if applicable. (4) - Quarterly net charge-offs (recoveries)
to average loans ratios are not annualized.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190424005194/en/
Nancy B. DavisExecutive Vice President andChief Financial
Officer(502) 625-9176
Stock Yards Bancorp (NASDAQ:SYBT)
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