SmartFinancial Announces Results for the First Quarter 2024
KNOXVILLE, Tenn., April 22, 2024 (GLOBE NEWSWIRE) -- SmartFinancial, Inc. ("SmartFinancial" or the "Company"; NYSE: SMBK), today announced net income of $9.4 million, or $0.55 per diluted common share, for the first quarter of 2024, compared to net income of $11.5 million, or $0.68 per diluted common share, for the first quarter of 2023, and compared to prior quarter net income of $6.2 million, or $0.37 per diluted common share. Operating earnings1, which excludes non-recurring income related to the gain on sale of a branch location, net of tax adjustments, totaled $8.4 million, or $0.49 per diluted common share, in the first quarter of 2024, compared to $11.5 million, or $0.68 per diluted common share, in the first quarter of 2023, and compared to $6.9 million, or $0.41 per diluted common share, in the fourth quarter of 2023.
Highlights for the First Quarter of 2024
- Operating earnings1 of $8.4 million, or $0.49 per diluted common share
- Net organic loan and lease growth of $34 million - 4% annualized quarter-over-quarter increase
- Credit quality remains solid with nonperforming assets to total assets of 0.18%
- Deposit growth of $126.3 million – 12% annualized quarter-over-quarter increase
______________________________
1 Non-GAAP measure. See “Non-GAAP Financial Measures” for more information and see the Non-GAAP reconciliation
Billy Carroll, President & CEO, stated: “Our company started 2024 with nice momentum. The first quarter was highlighted by continued growth in both loans and deposits, each growing 4% and 12%, respectively, along with expense discipline and focus on operating leverage improvement. The investments we’ve made over the last few years have positioned us well and with a margin inflection point on the horizon, we remain very bullish.”
SmartFinancial's Chairman, Miller Welborn, concluded: “Our team continued to make substantial forward progress on our key strategic initiatives in the first quarter. Our associates worked diligently to grow revenue and control expenses, setting the stage for operating leverage gains for the remainder of 2024. Continued commitment to EXCELLENT client service and growing shareholder value remains “top of mind” for our team.”
Net Interest Income and Net Interest Margin
Net interest income was $31.7 million for the first quarter of 2024, compared to $31.5 million for the prior quarter. Average earning assets totaled $4.50 billion, an increase of $116.4 million from the prior quarter. The increase in average earnings assets was primarily driven by an increase in average interest-earning cash of $64.0 million, average loans and leases of $49.7 million and average securities of $2.7 million. Average interest-bearing liabilities increased by $144.2 million from the prior quarter, attributable to an increase in average deposits of $146.3 million, offset by a decrease in average borrowings of $2.2 million.
The tax equivalent net interest margin was 2.85% for the first quarter of 2024, compared to 2.86% for the prior quarter. The tax equivalent net interest margin was negatively impacted by the increased cost of interest-bearing liabilities, coupled with a slower rise on yield on interest-earning assets, quarter-over-quarter. The yield on loans and leases, excluding loan fees, was 5.71% for the first quarter, compared to 5.61% for the prior quarter.
The cost of total deposits for the first quarter of 2024 was 2.52% compared to 2.35% in the prior quarter. The cost of interest-bearing liabilities increased to 3.23% for the first quarter of 2024, compared to 3.07% for the prior quarter. The cost of average interest-bearing deposits was 3.16% for the first quarter of 2024, compared to 3.00% for the prior quarter, an increase of 16 basis points.
The following table presents selected interest rates and yields for the periods indicated:
| Three Months Ended | ||||||||||
| Mar | Dec | Increase | ||||||||
| Selected Interest Rates and Yields | 2024 | 2023 | (Decrease) | |||||||
| Yield on loans and leases, excluding loan fees | 5.71 | % | 5.61 | % | 0.10 | % | ||||
| Yield on loans and leases | 5.82 | % | 5.68 | % | 0.14 | % | ||||
| Yield on earning assets, on a fully tax equivalent basis (FTE) | 5.36 | % | 5.22 | % | 0.14 | % | ||||
| Cost of interest-bearing deposits | 3.16 | % | 3.00 | % | 0.16 | % | ||||
| Cost of total deposits | 2.52 | % | 2.35 | % | 0.17 | % | ||||
| Cost of interest-bearing liabilities | 3.23 | % | 3.07 | % | 0.16 | % | ||||
| Net interest margin, FTE | 2.85 | % | 2.86 | % | (0.01 | ) | % | |||
Provision for Credit Losses on Loans and Leases and Credit Quality
At March 31, 2024, the allowance for credit losses was $34.2 million. The allowance for credit losses to total loans and leases was 0.98% as of March 31, 2024, compared to 1.02% as of December 31, 2023.
The following table presents detailed information related to the provision for credit losses for the periods indicated (dollars in thousands):
| Three Months Ended | |||||||||||||
| Mar | Dec | ||||||||||||
| Provision for Credit Losses on Loans and Leases Rollforward | 2024 | 2023 | Change | ||||||||||
| Beginning balance | $ | 35,066 | $ | 33,687 | $ | 1,379 | |||||||
| Charge-offs | (920 | ) | (424 | ) | (496 | ) | |||||||
| Recoveries | 135 | 302 | (167 | ) | |||||||||
| Net (charge-offs) recoveries | (785 | ) | (122 | ) | (663 | ) | |||||||
| Provision for credit losses (1) | (78 | ) | 1,501 | (1,579 | ) | ||||||||
| Ending balance | $ | 34,203 | $ | 35,066 | $ | (863 | ) | ||||||
| Allowance for credit losses to total loans and leases, gross | 0.98 | % | 1.02 | % | (0.04 | ) | % | ||||||
| (1) | The current quarter-ended and prior quarter-ended excludes unfunded commitments release of $362 thousand and a provision of $69 thousand, respectively. At March 31, 2024, the unfunded commitment liability totaled $2.0 million. | |
Nonperforming loans and leases as a percentage of total loans and leases was 0.18% as of March 31, 2024, a decrease of 6 basis points from the 0.24% reported in the fourth quarter of 2023. Total nonperforming assets (which include nonaccrual loans and leases, loans and leases past due 90 days or more and still accruing, other real estate owned and other repossessed assets) as a percentage of total assets was 0.18% as of March 31, 2024, and 0.20% on December 31, 2023.
The following table presents detailed information related to credit quality for the periods indicated (dollars in thousands):
| Three Months Ended | |||||||||||||
| Mar | Dec | Increase | |||||||||||
| Credit Quality | 2024 | 2023 | (Decrease) | ||||||||||
| Nonaccrual loans and leases | $ | 6,171 | $ | 7,931 | $ | (1,760 | ) | ||||||
| Loans and leases past due 90 days or more and still accruing | 95 | 170 | (75 | ) | |||||||||
| Total nonperforming loans and leases | 6,266 | 8,101 | (1,835 | ) | |||||||||
| Other real estate owned | 696 | 517 | 179 | ||||||||||
| Other repossessed assets | 2,033 | 1,117 | 916 | ||||||||||
| Total nonperforming assets | $ | 8,995 | $ | 9,735 | $ | (740 | ) | ||||||
| Nonperforming loans and leases to total loans and leases, gross | 0.18 | % | 0.24 | % | (0.06 | ) | % | ||||||
| Nonperforming assets to total assets | 0.18 | % | 0.20 | % | (0.02 | ) | % | ||||||
Noninterest Income
Noninterest income increased $801 thousand to $8.4 million for the first quarter of 2024 compared to $7.6 million for the prior quarter. The current quarter increase was primarily associated with the $1.3 million pre-tax gain on the sale of a former branch building.
The following table presents detailed information related to noninterest income for the periods indicated (dollars in thousands):
| Three Months Ended | ||||||||||||
| Mar | Dec | Increase | ||||||||||
| Noninterest Income | 2024 | 2023 | (Decrease) | |||||||||
| Service charges on deposit accounts | $ | 1,612 | $ | 1,673 | $ | (61 | ) | |||||
| Mortgage banking income | 280 | 227 | 53 | |||||||||
| Investment services | 1,380 | 1,339 | 41 | |||||||||
| Insurance commissions | 1,103 | 1,133 | (30 | ) | ||||||||
| Interchange and debit card transaction fees | 1,253 | 1,370 | (117 | ) | ||||||||
| Other | 2,752 | 1,837 | 915 | |||||||||
| Total noninterest income | $ | 8,380 | $ | 7,579 | $ | 801 | ||||||
Noninterest Expense
Noninterest expense decreased $1.1 million to $28.6 million for the first quarter of 2024 compared to $29.7 million for the prior quarter. The current quarter decrease was primarily related to a decrease in other noninterest expenses associated with a Community Reinvestment Act donation of a former branch location and accruals in respect of pending litigation in the prior quarter.
The following table presents detailed information related to noninterest expense for the periods indicated (dollars in thousands):
| Three Months Ended | ||||||||||||
| Mar | Dec | Increase | ||||||||||
| Noninterest Expense | 2024 | 2023 | (Decrease) | |||||||||
| Salaries and employee benefits | $ | 16,639 | $ | 16,275 | $ | 364 | ||||||
| Occupancy and equipment | 3,396 | 3,378 | 18 | |||||||||
| FDIC insurance | 915 | 915 | - | |||||||||
| Other real estate and loan related expenses | 584 | 781 | (197 | ) | ||||||||
| Advertising and marketing | 302 | 336 | (34 | ) | ||||||||
| Data processing and technology | 2,465 | 2,458 | 7 | |||||||||
| Professional services | 924 | 1,136 | (212 | ) | ||||||||
| Amortization of intangibles | 612 | 643 | (31 | ) | ||||||||
| Merger related and restructuring expenses | - | - | - | |||||||||
| Other | 2,716 | 3,773 | (1,057 | ) | ||||||||
| Total noninterest expense | $ | 28,553 | $ | 29,695 | $ | (1,142 | ) | |||||
Income Tax Expense
Income tax expense was $2.6 million for the first quarter of 2024, an increase of $990 thousand, compared to $1.6 million for the prior quarter.
The effective tax rate was 21.94% for the first quarter of 2024 and 20.95% for the prior quarter.
Balance Sheet Trends
Total assets at March 31, 2024 were $4.95 billion compared to $4.83 billion at December 31, 2023. The $125.3 million increase is primarily attributable to increases in cash and cash equivalents of $125.7 million and loans and leases of $33.1 Asset increases were offset by a decrease in securities of $35.1 million.
Total liabilities increased to $4.49 billion at March 31, 2024 from $4.37 billion at December 31, 2023. The increase of $118.4 million was primarily from organic deposit growth of $126.3 million, offset by a decrease in borrowings of $3.2 million and other liabilities of $4.7 million.
Shareholders' equity at March 31, 2024, totaled $466.8 million, an increase of $6.9 million, from December 31, 2023. The increase in shareholders' equity was primarily driven by net income of $9.4 million for the three months ended March 31, 2024, offset by the negative change of $1.5 million in accumulated other comprehensive income and dividends paid of $1.3 million. Tangible book value per share1 was $21.12 at March 31, 2024, compared to $20.76 at December 31, 2023. Tangible common equity1 as a percentage of tangible assets1 was 7.43% at March 31, 2024, compared with 7.47% at December 31, 2023.
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1 Non-GAAP measure. See “Non-GAAP Financial Measures” for more information and see the Non-GAAP reconciliation
The following table presents selected balance sheet information for the periods indicated (dollars in thousands):
| Mar | Dec | Increase | ||||||||||
| Selected Balance Sheet Information | 2024 | 2023 | (Decrease) | |||||||||
| Total assets | $ | 4,954,690 | $ | 4,829,387 | $ | 125,303 | ||||||
| Total liabilities | 4,487,894 | 4,369,501 | 118,393 | |||||||||
| Total equity | 466,796 | 459,886 | 6,910 | |||||||||
| Securities | 654,516 | 689,646 | (35,130 | ) | ||||||||
| Loans and leases | 3,477,555 | 3,444,462 | 33,093 | |||||||||
| Deposits | 4,394,121 | 4,267,854 | 126,267 | |||||||||
| Borrowings | 9,849 | 13,078 | (3,229 | ) | ||||||||
Conference Call Information
SmartFinancial issued this earnings release for the first quarter of 2024 on Monday, April 22, 2024, and will host a conference call on Tuesday, April 23, 2024, at 10:00 a.m. ET. To access this interactive teleconference, dial (833) 470-1428 or (404) 975-4839 and entering the access code, 060240. A replay of the conference call will be available through June 22, 2024, by dialing (866) 813-9403 or (929) 458-6194 and entering the access code, 672905. Conference call materials will be published on the Company’s webpage located at , at 9:00 a.m. ET prior to the conference call.
About SmartFinancial, Inc.
SmartFinancial, Inc., based in Knoxville, Tennessee, is the bank holding company for SmartBank. SmartBank is a full-service commercial bank founded in 2007, with branches across Tennessee, Alabama, and Florida. Recruiting the best people, delivering exceptional client service, strategic branching, and a disciplined approach to lending have contributed to SmartBank’s success. More information about SmartFinancial can be found on its website:
| Source | |
| SmartFinancial, Inc. | |
| Investor Contacts | |
| Billy Carroll | |
| President & CEO | |
| (865) 868-0613 | |
| Ron Gorczynski | |
| Executive Vice President, Chief Financial Officer | |
| (865) 437-5724 | |
| Media Contact | |
| Kelley Fowler | |
| Senior Vice President, Public Relations & Marketing | |
| (865) 868-0611 | |
Non-GAAP Financial Measures
Statements included in this earnings release include measures not recognized under U.S. generally accepted accounting principles (“GAAP”) and therefore are considered non-GAAP financial measures and should be read along with the accompanying tables, which provide a reconciliation of Non-GAAP financial measures to GAAP financial measures. SmartFinancial management uses several Non-GAAP financial measures, including: (i) operating earnings, (ii) operating return on average assets, (iii) operating pre-provision net revenue return on average assets, (iv) operating return on average shareholders' equity, (v) return on average tangible common equity, (vi) operating return on average tangible common equity, (vii) operating efficiency ratio, (viii) operating noninterest income, (ix) operating pre-provision net revenue earnings, (x) operating noninterest expense, (xi) tangible common equity, (xii) average tangible common equity, (xiii) tangible book value per common share, (xiv) tangible assets; and ratios derived therefrom, in its analysis of the company's performance. Operating earnings excludes the following from net income: securities gains and losses and merger related and restructuring expenses. Operating return on average assets is the annualized operating earnings (Non-GAAP) divided by average assets. Operating pre-provision net revenue return on average assets is the annualized operating pre-provision net revenue income earnings (Non-GAAP) by average assets. Operating return on average shareholders' equity is the annualized operating earnings (Non-GAAP) divided by average equity. Return on average tangible common equity is the annualized net income divided by average tangible common equity (Non-GAAP). Operating return on average tangible common equity is the annualized operating earnings (Non-GAAP) divided by average tangible common equity (Non-GAAP). The operating efficiency ratio includes an adjustment for taxable equivalent yields and excludes securities gains and losses and merger related and restructuring expenses from the efficiency ratio. Operating noninterest income excludes the following from noninterest income: securities gains and losses. Operating pre-provision net revenue earnings is net interest income plus operating noninterest income (Non-GAAP) less operating noninterest expense (Non-GAAP). Operating noninterest interest income and operating noninterest expense exclude non-operating related income and expense items. A detailed reconciliation of these items are available in the Non-GAAP reconciliations. Tangible common equity (Non-GAAP) and average tangible common equity (Non-GAAP) excludes goodwill and other intangible assets from shareholders' equity and average shareholders' equity, respectively. Tangible book value per common share (Non-GAAP) is tangible common equity (Non-GAAP) divided by common shares outstanding. Tangible assets (Non-GAAP) excludes goodwill and other intangibles from total assets. Management believes that Non-GAAP financial measures provide additional useful information that allows investors to evaluate the ongoing performance of the company and provide meaningful comparisons to its peers. Management believes these Non-GAAP financial measures also enhance investors' ability to compare period-to-period financial results and allow investors and company management to view our operating results excluding the impact of items that are not reflective of the underlying operating performance. Non-GAAP financial measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider SmartFinancial's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the company. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the results or financial condition as reported under GAAP.
Forward-Looking Statements
This news release may contain statements that are based on management’s current estimates or expectations of future events or future results, and that may be deemed to constitute forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. These statements are not historical in nature and can generally be identified by such words as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “may,” “estimate,” and similar expressions. All forward-looking statements are subject to risks, uncertainties, and other factors that may cause the actual results of SmartFinancial to differ materially from future results expressed or implied by such forward-looking statements. Such risks, uncertainties, and other factors include, among others, (1) risks associated with our growth strategy, including a failure to implement our growth plans or an inability to manage our growth effectively; (2) claims and litigation arising from our business activities and from the companies we acquire, which may relate to contractual issues, environmental laws, fiduciary responsibility, and other matters; (3) the risk that cost savings and revenue synergies from recently completed acquisitions may not be realized or may take longer than anticipated to realize; (4) disruption from recently completed acquisitions with customer, supplier, employee, or other business relationships; (5) our ability to successfully integrate the businesses acquired as part of previous acquisitions with the business of SmartBank; (6) changes in management’s plans for the future; (7) prevailing, or changes in, economic or political conditions, particularly in our market areas, including the effects of declines in the real estate market, high unemployment rates, inflationary pressures, elevated interest rates and slowdowns in economic growth, as well as the financial stress on borrowers as a result of the foregoing; (8) increased technology and cybersecurity risks, including generative artificial intelligence risks; (9) credit risk associated with our lending activities; (10) changes in loan demand, real estate values, or competition; (11) developments in our mortgage banking business, including loan modifications, general demand, and the effects of judicial or regulatory requirements or guidance; (12) changes in accounting principles, policies, or guidelines; (13) changes in applicable laws, rules, or regulations; (14) adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company’s participation in and execution of government programs related to the COVID-19 pandemic and related variants; (15) potential impacts of adverse developments in the banking industry highlighted by high-profile bank failures, including impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; (16) significant turbulence or a disruption in the capital or financial markets and the effect of a fall in stock market prices on our investment securities; (17) the effects of war or other conflicts including the impacts related to or resulting from Russia’s military action in Ukraine or the conflict in Israel and surrounding areas; and (18) other general competitive, economic, political, and market factors, including those affecting our business, operations, pricing, products, or services. These and other factors that could cause results to differ materially from those described in the forward-looking statements can be found in SmartFinancial’s most recent annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, in each case filed with or furnished to the Securities and Exchange Commission (the “SEC”) and available on the SEC’s website (). Undue reliance should not be placed on forward-looking statements. SmartFinancial disclaims any obligation to update or revise any forward-looking statements contained in this release, which speak only as of the date hereof, whether as a result of new information, future events, or otherwise.
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands)
| Ending Balances | |||||||||||||||||||
| Mar | Dec | Sep | Jun | Mar | |||||||||||||||
| 2024 | 2023 | 2023 | 2023 | 2023 | |||||||||||||||
| Assets: | |||||||||||||||||||
| Cash and cash equivalents | $ | 477,941 | $ | 352,271 | $ | 400,258 | $ | 238,898 | $ | 306,934 | |||||||||
| Securities available-for-sale, at fair value | 474,347 | 408,410 | 385,131 | 540,308 | 560,418 | ||||||||||||||
| Securities held-to-maturity, at amortized cost | 180,169 | 281,236 | 282,313 | 283,564 | 284,776 | ||||||||||||||
| Other investments | 13,718 | 13,662 | 13,805 | 14,396 | 14,059 | ||||||||||||||
| Loans held for sale | 4,861 | 4,418 | 2,734 | 986 | 3,324 | ||||||||||||||
| Loans and leases | 3,477,555 | 3,444,462 | 3,378,999 | 3,337,790 | 3,281,787 | ||||||||||||||
| Less: Allowance for credit losses | (34,203 | ) | (35,066 | ) | (33,687 | ) | (32,747 | ) | (32,279 | ) | |||||||||
| Loans and leases, net | 3,443,352 | 3,409,396 | 3,345,312 | 3,305,043 | 3,249,508 | ||||||||||||||
| Premises and equipment, net | 92,694 | 92,963 | 92,020 | 92,351 | 92,190 | ||||||||||||||
| Other real estate owned | 696 | 517 | 1,370 | 1,708 | 1,708 | ||||||||||||||
| Goodwill and other intangibles, net | 106,537 | 107,148 | 107,792 | 108,439 | 109,114 | ||||||||||||||
| Bank owned life insurance | 83,957 | 83,434 | 82,914 | 82,419 | 81,938 | ||||||||||||||
| Other assets | 76,418 | 75,932 | 83,522 | 77,688 | 65,836 | ||||||||||||||
| Total assets | $ | 4,954,690 | $ | 4,829,387 | $ | 4,797,171 | $ | 4,745,800 | $ | 4,769,805 | |||||||||
| Liabilities: | |||||||||||||||||||
| Deposits: | |||||||||||||||||||
| Noninterest-bearing demand | $ | 907,254 | $ | 898,044 | $ | 923,763 | $ | 1,003,432 | $ | 989,753 | |||||||||
| Interest-bearing demand | 996,298 | 1,006,915 | 993,717 | 938,758 | 989,738 | ||||||||||||||
| Money market and savings | 1,952,410 | 1,812,427 | 1,766,409 | 1,720,202 | 1,761,847 | ||||||||||||||
| Time deposits | 538,159 | 550,468 | 562,620 | 537,192 | 488,208 | ||||||||||||||
| Total deposits | 4,394,121 | 4,267,854 | 4,246,509 | 4,199,584 | 4,229,546 | ||||||||||||||
| Borrowings | 9,849 | 13,078 | 14,117 | 15,496 | 16,546 | ||||||||||||||
| Subordinated debt | 42,120 | 42,099 | 42,078 | 42,057 | 42,036 | ||||||||||||||
| Other liabilities | 41,804 | 46,470 | 47,815 | 43,816 | 38,278 | ||||||||||||||
| Total liabilities | 4,487,894 | 4,369,501 | 4,350,519 | 4,300,953 | 4,326,406 | ||||||||||||||
| Shareholders' Equity: | |||||||||||||||||||
| Common stock | 17,057 | 16,989 | 16,995 | 17,004 | 17,004 | ||||||||||||||
| Additional paid-in capital | 296,061 | 295,699 | 295,542 | 295,296 | 294,930 | ||||||||||||||
| Retained earnings | 181,103 | 173,105 | 168,271 | 167,564 | 160,085 | ||||||||||||||
| Accumulated other comprehensive income (loss) | (27,425 | ) | (25,907 | ) | (34,156 | ) | (35,017 | ) | (28,620 | ) | |||||||||
| Total shareholders' equity | 466,796 | 459,886 | 446,652 | 444,847 | 443,399 | ||||||||||||||
| Total liabilities & shareholders' equity | $ | 4,954,690 | $ | 4,829,387 | $ | 4,797,171 | $ | 4,745,800 | $ | 4,769,805 | |||||||||
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands except share and per share data)
| Three Months Ended | |||||||||||||||||||
| Mar | Dec | Sep | Jun | Mar | |||||||||||||||
| 2024 | 2023 | 2023 | 2023 | 2023 | |||||||||||||||
| Interest income: | |||||||||||||||||||
| Loans and leases, including fees | $ | 50,020 | $ | 48,767 | $ | 47,539 | $ | 45,446 | $ | 44,728 | |||||||||
| Investment securities: | |||||||||||||||||||
| Taxable | 4,548 | 4,344 | 4,335 | 4,335 | 3,651 | ||||||||||||||
| Tax-exempt | 352 | 352 | 356 | 357 | 353 | ||||||||||||||
| Federal funds sold and other earning assets | 4,863 | 4,032 | 3,045 | 1,956 | 4,446 | ||||||||||||||
| Total interest income | 59,783 | 57,495 | 55,275 | 52,094 | 53,178 | ||||||||||||||
| Interest expense: | |||||||||||||||||||
| Deposits | 27,035 | 24,926 | 23,433 | 19,554 | 16,346 | ||||||||||||||
| Borrowings | 128 | 162 | 210 | 339 | 224 | ||||||||||||||
| Subordinated debt | 899 | 890 | 626 | 626 | 626 | ||||||||||||||
| Total interest expense | 28,062 | 25,978 | 24,269 | 20,519 | 17,196 | ||||||||||||||
| Net interest income | 31,721 | 31,517 | 31,006 | 31,575 | 35,982 | ||||||||||||||
| Provision for credit losses | (440 | ) | 1,571 | 795 | 113 | 550 | |||||||||||||
| Net interest income after provision for credit losses | 32,161 | 29,946 | 30,211 | 31,462 | 35,432 | ||||||||||||||
| Noninterest income: | |||||||||||||||||||
| Service charges on deposit accounts | 1,612 | 1,673 | 1,736 | 1,657 | 1,445 | ||||||||||||||
| Gain (loss) on sale of securities, net | — | — | (6,801 | ) | — | — | |||||||||||||
| Mortgage banking | 280 | 227 | 309 | 332 | 172 | ||||||||||||||
| Investment services | 1,380 | 1,339 | 1,461 | 1,300 | 1,005 | ||||||||||||||
| Insurance commissions | 1,103 | 1,133 | 1,153 | 1,139 | 1,259 | ||||||||||||||
| Interchange and debit card transaction fees | 1,253 | 1,370 | 1,357 | 1,347 | 1,383 | ||||||||||||||
| Other | 2,752 | 1,837 | 1,476 | 1,355 | 1,661 | ||||||||||||||
| Total noninterest income | 8,380 | 7,579 | 691 | 7,130 | 6,925 | ||||||||||||||
| Noninterest expense: | |||||||||||||||||||
| Salaries and employee benefits | 16,639 | 16,275 | 16,785 | 15,947 | 16,742 | ||||||||||||||
| Occupancy and equipment | 3,396 | 3,378 | 3,547 | 3,318 | 3,208 | ||||||||||||||
| FDIC insurance | 915 | 915 | 825 | 875 | 541 | ||||||||||||||
| Other real estate and loan related expense | 584 | 781 | 603 | 441 | 572 | ||||||||||||||
| Advertising and marketing | 302 | 336 | 346 | 305 | 355 | ||||||||||||||
| Data processing and technology | 2,465 | 2,458 | 2,378 | 2,235 | 2,163 | ||||||||||||||
| Professional services | 924 | 1,136 | 735 | 764 | 807 | ||||||||||||||
| Amortization of intangibles | 612 | 643 | 647 | 675 | 659 | ||||||||||||||
| Merger related and restructuring expenses | — | — | 110 | — | — | ||||||||||||||
| Other | 2,716 | 3,773 | 2,540 | 2,850 | 2,482 | ||||||||||||||
| Total noninterest expense | 28,553 | 29,695 | 28,516 | 27,410 | 27,529 | ||||||||||||||
| Income before income taxes | 11,988 | 7,830 | 2,386 | 11,182 | 14,828 | ||||||||||||||
| Income tax expense | 2,630 | 1,640 | 319 | 2,346 | 3,328 | ||||||||||||||
| Net income | $ | 9,358 | $ | 6,190 | $ | 2,067 | $ | 8,836 | $ | 11,500 | |||||||||
| Earnings per common share: | |||||||||||||||||||
| Basic | $ | 0.56 | $ | 0.37 | $ | 0.12 | $ | 0.53 | $ | 0.69 | |||||||||
| Diluted | $ | 0.55 | $ | 0.37 | $ | 0.12 | $ | 0.52 | $ | 0.68 | |||||||||
| Weighted average common shares outstanding: | |||||||||||||||||||
| Basic | 16,849,735 | 16,814,647 | 16,807,548 | 16,806,389 | 16,791,406 | ||||||||||||||
| Diluted | 16,925,408 | 16,918,234 | 16,918,635 | 16,898,091 | 16,896,494 | ||||||||||||||
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands)
YIELD ANALYSIS
| Three Months Ended | |||||||||||||||||||||||||||||||||
| March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||||||||||||||||||||||||
| Average | Yield/ | Average | Yield/ | Average | Yield/ | ||||||||||||||||||||||||||||
| Balance | Interest | Cost | Balance | Interest | Cost | Balance | Interest | Cost | |||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||
| Loans and leases, including fees | $ | 3,458,109 | $ | 50,020 | 5.82 | % | $ | 3,408,430 | $ | 48,767 | 5.68 | % | $ | 3,258,452 | $ | 44,728 | 5.57 | % | |||||||||||||||
| Taxable securities | 620,805 | 4,548 | 2.95 | % | 618,511 | 4,344 | 2.79 | % | 723,540 | 3,651 | 2.05 | % | |||||||||||||||||||||
| Tax-exempt securities1 | 64,161 | 445 | 2.79 | % | 63,767 | 445 | 2.77 | % | 65,547 | 447 | 2.77 | % | |||||||||||||||||||||
| Federal funds sold and other earning assets | 353,913 | 4,863 | 5.53 | % | 289,896 | 4,032 | 5.52 | % | 378,253 | 4,446 | 4.77 | % | |||||||||||||||||||||
| Total interest-earning assets | 4,496,988 | 59,876 | 5.36 | % | 4,380,604 | 57,588 | 5.22 | % | 4,425,792 | 53,272 | 4.88 | % | |||||||||||||||||||||
| Noninterest-earning assets | 380,231 | 386,202 | 359,996 | ||||||||||||||||||||||||||||||
| Total assets | $ | 4,877,219 | $ | 4,766,806 | $ | 4,785,788 | |||||||||||||||||||||||||||
| Liabilities and Shareholders’ Equity: | |||||||||||||||||||||||||||||||||
| Interest-bearing demand deposits | $ | 996,147 | 6,060 | 2.45 | % | $ | 974,637 | 5,631 | 2.29 | % | $ | 944,132 | 4,227 | 1.82 | % | ||||||||||||||||||
| Money market and savings deposits | 1,904,855 | 16,149 | 3.41 | % | 1,764,826 | 14,556 | 3.27 | % | 1,820,455 | 10,381 | 2.31 | % | |||||||||||||||||||||
| Time deposits | 541,792 | 4,826 | 3.58 | % | 556,996 | 4,739 | 3.38 | % | 469,361 | 1,738 | 1.50 | % | |||||||||||||||||||||
| Total interest-bearing deposits | 3,442,794 | 27,035 | 3.16 | % | 3,296,459 | 24,926 | 3.00 | % | 3,233,948 | 16,346 | 2.05 | % | |||||||||||||||||||||
| Borrowings | 11,245 | 128 | 4.58 | % | 13,420 | 162 | 4.79 | % | 16,858 | 224 | 5.39 | % | |||||||||||||||||||||
| Subordinated debt | 42,107 | 899 | 8.59 | % | 42,087 | 890 | 8.39 | % | 42,022 | 626 | 6.04 | % | |||||||||||||||||||||
| Total interest-bearing liabilities | 3,496,146 | 28,062 | 3.23 | % | 3,351,966 | 25,978 | 3.07 | % | 3,292,828 | 17,196 | 2.12 | % | |||||||||||||||||||||
| Noninterest-bearing deposits | 872,840 | 915,259 | 1,015,670 | ||||||||||||||||||||||||||||||
| Other liabilities | 47,085 | 50,055 | 44,908 | ||||||||||||||||||||||||||||||
| Total liabilities | 4,416,071 | 4,317,280 | 4,353,406 | ||||||||||||||||||||||||||||||
| Shareholders' equity | 461,148 | 449,526 | 432,382 | ||||||||||||||||||||||||||||||
| Total liabilities and shareholders' equity | $ | 4,877,219 | $ | 4,766,806 | $ | 4,785,788 | |||||||||||||||||||||||||||
| Net interest income, taxable equivalent | $ | 31,814 | $ | 31,610 | $ | 36,076 | |||||||||||||||||||||||||||
| Interest rate spread | 2.13 | % | 2.14 | % | 2.76 | % | |||||||||||||||||||||||||||
| Tax equivalent net interest margin | 2.85 | % | 2.86 | % | 3.31 | % | |||||||||||||||||||||||||||
| Percentage of average interest-earning assets to average interest-bearing liabilities | 128.63 | % | 130.69 | % | 134.41 | % | |||||||||||||||||||||||||||
| Percentage of average equity to average assets | 9.46 | % | 9.43 | % | 9.03 | % | |||||||||||||||||||||||||||
1Yields computed on tax-exempt instruments on a tax equivalent basis include $93 thousand, $94 thousand, and $94 thousand of taxable equivalent income for the quarters ended March 31, 2024, December 31, 2023, and March 31, 2023, respectively.
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands)
| As of and for The Three Months Ended | ||||||||||||||||||||
| Mar | Dec | Sep | Jun | Mar | ||||||||||||||||
| 2024 | 2023 | 2023 | 2023 | 2023 | ||||||||||||||||
| Composition of Loans and Leases: | ||||||||||||||||||||
| Commercial real estate: | ||||||||||||||||||||
| Owner occupied | $ | 804,557 | $ | 798,416 | $ | 776,402 | $ | 769,978 | $ | 764,166 | ||||||||||
| Non-owner occupied | 938,648 | 940,789 | 890,774 | 871,779 | 871,368 | |||||||||||||||
| Commercial real estate, total | 1,743,205 | 1,739,205 | 1,667,176 | 1,641,757 | 1,635,534 | |||||||||||||||
| Commercial & industrial | 667,903 | 645,918 | 617,115 | 594,427 | 571,153 | |||||||||||||||
| Construction & land development | 321,860 | 327,185 | 373,068 | 394,742 | 386,253 | |||||||||||||||
| Consumer real estate | 659,209 | 649,867 | 638,518 | 624,828 | 606,343 | |||||||||||||||
| Leases | 71,909 | 68,752 | 68,538 | 66,401 | 67,701 | |||||||||||||||
| Consumer and other | 13,469 | 13,535 | 14,584 | 15,635 | 14,803 | |||||||||||||||
| Total loans and leases | $ | 3,477,555 | $ | 3,444,462 | $ | 3,378,999 | $ | 3,337,790 | $ | 3,281,787 | ||||||||||
| Asset Quality and Additional Loan Data: | ||||||||||||||||||||
| Nonperforming loans and leases | $ | 6,266 | $ | 8,101 | $ | 4,163 | $ | 3,722 | $ | 3,247 | ||||||||||
| Other real estate owned | 696 | 517 | 1,370 | 1,708 | 1,708 | |||||||||||||||
| Other repossessed assets | 2,033 | 1,117 | 348 | 282 | 66 | |||||||||||||||
| Total nonperforming assets | $ | 8,995 | $ | 9,735 | $ | 5,881 | $ | 5,712 | $ | 5,021 | ||||||||||
| Modified loans and leases1 not included in nonperforming loans and leases | $ | 4,413 | $ | 4,245 | $ | 2,376 | $ | 657 | $ | 97 | ||||||||||
| Net charge-offs to average loans and leases (annualized) | 0.09 | % | 0.04 | % | 0.04 | % | (0.01 | ) | % | 0.03 | % | |||||||||
| Allowance for credit losses to loans and leases | 0.98 | % | 1.02 | % | 1.00 | % | 0.98 | % | 0.98 | % | ||||||||||
| Nonperforming loans and leases to total loans and leases, gross | 0.18 | % | 0.24 | % | 0.12 | % | 0.11 | % | 0.10 | % | ||||||||||
| Nonperforming assets to total assets | 0.18 | % | 0.20 | % | 0.12 | % | 0.12 | % | 0.11 | % | ||||||||||
| Capital Ratios: | ||||||||||||||||||||
| Equity to Assets | 9.42 | % | 9.52 | % | 9.31 | % | 9.37 | % | 9.30 | % | ||||||||||
| Tangible common equity to tangible assets (Non-GAAP)2 | 7.43 | % | 7.47 | % | 7.23 | % | 7.25 | % | 7.17 | % | ||||||||||
| SmartFinancial, Inc.3 | ||||||||||||||||||||
| Tier 1 leverage | 8.23 | % | 8.27 | % | 8.13 | % | 8.24 | % | 7.91 | % | ||||||||||
| Common equity Tier 1 | 10.20 | % | 10.16 | % | 10.07 | % | 10.12 | % | 9.95 | % | ||||||||||
| Tier 1 capital | 10.20 | % | 10.16 | % | 10.07 | % | 10.12 | % | 9.95 | % | ||||||||||
| Total capital | 11.85 | % | 11.80 | % | 11.90 | % | 11.94 | % | 11.77 | % | ||||||||||
| SmartBank | Estimated4 | |||||||||||||||||||
| Tier 1 leverage | 9.07 | % | 9.18 | % | 9.00 | % | 9.18 | % | 8.87 | % | ||||||||||
| Common equity Tier 1 | 11.23 | % | 11.26 | % | 11.15 | % | 11.27 | % | 11.15 | % | ||||||||||
| Tier 1 capital | 11.23 | % | 11.26 | % | 11.15 | % | 11.27 | % | 11.15 | % | ||||||||||
| Total capital | 12.00 | % | 12.02 | % | 11.87 | % | 11.97 | % | 11.85 | % | ||||||||||
1Borrowers that have experienced financial difficulty.
2Total common equity less intangibles divided by total assets less intangibles. See reconciliation of Non-GAAP measures.
3All periods presented are estimated.
4Current period capital ratios are estimated as of the date of this earnings release.
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands except share and per share data)
| As of and for The | ||||||||||||||||||||
| Three Months Ended | ||||||||||||||||||||
| Mar | Dec | Sep | Jun | Mar | ||||||||||||||||
| 2024 | 2023 | 2023 | 2023 | 2023 | ||||||||||||||||
| Selected Performance Ratios (Annualized): | ||||||||||||||||||||
| Return on average assets | 0.77 | % | 0.52 | % | 0.17 | % | 0.75 | % | 0.97 | % | ||||||||||
| Return on average shareholders' equity | 8.16 | % | 5.46 | % | 1.84 | % | 7.98 | % | 10.79 | % | ||||||||||
| Return on average tangible common equity¹ | 10.62 | % | 7.18 | % | 2.43 | % | 10.57 | % | 14.45 | % | ||||||||||
| Noninterest income / average assets | 0.69 | % | 0.63 | % | 0.06 | % | 0.61 | % | 0.59 | % | ||||||||||
| Noninterest expense / average assets | 2.35 | % | 2.47 | % | 2.37 | % | 2.34 | % | 2.33 | % | ||||||||||
| Efficiency ratio | 71.20 | % | 75.95 | % | 89.96 | % | 70.82 | % | 64.16 | % | ||||||||||
| Operating Selected Performance Ratios (Annualized): | ||||||||||||||||||||
| Operating return on average assets1 | 0.69 | % | 0.57 | % | 0.60 | % | 0.75 | % | 0.97 | % | ||||||||||
| Operating PPNR return on average assets1 | 0.84 | % | 0.86 | % | 0.84 | % | 0.96 | % | 1.30 | % | ||||||||||
| Operating return on average shareholders' equity1 | 7.29 | % | 6.07 | % | 6.41 | % | 7.98 | % | 10.79 | % | ||||||||||
| Operating return on average tangible common equity1 | 9.49 | % | 7.98 | % | 8.46 | % | 10.57 | % | 14.45 | % | ||||||||||
| Operating efficiency ratio1 | 73.50 | % | 73.41 | % | 73.60 | % | 70.64 | % | 64.02 | % | ||||||||||
| Operating noninterest income / average assets1 | 0.58 | % | 0.63 | % | 0.62 | % | 0.61 | % | 0.59 | % | ||||||||||
| Operating noninterest expense / average assets1 | 2.35 | % | 2.39 | % | 2.36 | % | 2.34 | % | 2.33 | % | ||||||||||
| Selected Interest Rates and Yields: | ||||||||||||||||||||
| Yield on loans and leases, excluding loan fees | 5.71 | % | 5.61 | % | 5.52 | % | 5.39 | % | 5.20 | % | ||||||||||
| Yield on loans and leases | 5.82 | % | 5.68 | % | 5.61 | % | 5.51 | % | 5.57 | % | ||||||||||
| Yield on earning assets, FTE | 5.36 | % | 5.22 | % | 4.99 | % | 4.82 | % | 4.88 | % | ||||||||||
| Cost of interest-bearing deposits | 3.16 | % | 3.00 | % | 2.84 | % | 2.46 | % | 2.05 | % | ||||||||||
| Cost of total deposits | 2.52 | % | 2.35 | % | 2.20 | % | 1.89 | % | 1.56 | % | ||||||||||
| Cost of interest-bearing liabilities | 3.23 | % | 3.07 | % | 2.89 | % | 2.53 | % | 2.12 | % | ||||||||||
| Net interest margin, FTE | 2.85 | % | 2.86 | % | 2.81 | % | 2.93 | % | 3.31 | % | ||||||||||
| Per Common Share: | ||||||||||||||||||||
| Net income, basic | $ | 0.56 | $ | 0.37 | $ | 0.12 | $ | 0.53 | $ | 0.69 | ||||||||||
| Net income, diluted | 0.55 | 0.37 | 0.12 | 0.52 | 0.68 | |||||||||||||||
| Operating earnings, basic¹ | 0.50 | 0.41 | 0.43 | 0.53 | 0.69 | |||||||||||||||
| Operating earnings, diluted¹ | 0.49 | 0.41 | 0.43 | 0.52 | 0.68 | |||||||||||||||
| Book value | 27.37 | 27.07 | 26.28 | 26.16 | 26.08 | |||||||||||||||
| Tangible book value¹ | 21.12 | 20.76 | 19.94 | 19.78 | 19.66 | |||||||||||||||
| Common shares outstanding | 17,056,704 | 16,988,879 | 16,994,543 | 17,004,092 | 17,004,092 | |||||||||||||||
1Non-GAAP measure. See reconciliation of Non-GAAP measures.
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands)
NON-GAAP RECONCILIATIONS
| Three Months Ended | ||||||||||||||||||||
| Mar | Dec | Sep | Jun | Mar | ||||||||||||||||
| 2024 | 2023 | 2023 | 2023 | 2023 | ||||||||||||||||
| Operating Earnings: | ||||||||||||||||||||
| Net income (GAAP) | $ | 9,358 | $ | 6,190 | $ | 2,067 | $ | 8,836 | $ | 11,500 | ||||||||||
| Noninterest income: | ||||||||||||||||||||
| Securities (gains) losses, net | — | — | 6,801 | — | — | |||||||||||||||
| Gain on sale of former branch building | (1,346 | ) | — | — | — | — | ||||||||||||||
| Noninterest expenses: | ||||||||||||||||||||
| Donation of a former branch location | — | 250 | — | — | — | |||||||||||||||
| Accruals for pending litigation | — | 675 | — | — | — | |||||||||||||||
| Merger related and restructuring expenses | — | — | 110 | — | — | |||||||||||||||
| Income taxes: | ||||||||||||||||||||
| Income tax effect of adjustments | 348 | (239 | ) | (1,785 | ) | — | — | |||||||||||||
| Operating earnings (Non-GAAP) | $ | 8,360 | $ | 6,876 | $ | 7,193 | $ | 8,836 | $ | 11,500 | ||||||||||
| Operating earnings per common share (Non-GAAP): | ||||||||||||||||||||
| Basic | $ | 0.50 | $ | 0.41 | $ | 0.43 | $ | 0.53 | $ | 0.69 | ||||||||||
| Diluted | 0.49 | 0.41 | 0.43 | 0.52 | 0.68 | |||||||||||||||
| Operating Noninterest Income: | ||||||||||||||||||||
| Noninterest income (GAAP) | $ | 8,380 | $ | 7,579 | $ | 691 | $ | 7,130 | $ | 6,925 | ||||||||||
| Securities (gains) losses, net | — | — | 6,801 | — | — | |||||||||||||||
| Gain on sale of former branch building | (1,346 | ) | — | — | — | — | ||||||||||||||
| Operating noninterest income (Non-GAAP) | $ | 7,034 | $ | 7,579 | $ | 7,492 | $ | 7,130 | $ | 6,925 | ||||||||||
| Operating noninterest income (Non-GAAP)/average assets1 | 0.58 | % | 0.63 | % | 0.62 | % | 0.61 | % | 0.59 | % | ||||||||||
| Operating Noninterest Expense: | ||||||||||||||||||||
| Noninterest expense (GAAP) | $ | 28,553 | $ | 29,695 | $ | 28,516 | $ | 27,410 | $ | 27,529 | ||||||||||
| Donation of a former branch location | — | (250 | ) | — | — | — | ||||||||||||||
| Accruals for pending litigation | — | (675 | ) | — | — | — | ||||||||||||||
| Merger related and restructuring expenses | — | — | (110 | ) | — | — | ||||||||||||||
| Operating noninterest expense (Non-GAAP) | $ | 28,553 | $ | 28,770 | $ | 28,406 | $ | 27,410 | $ | 27,529 | ||||||||||
| Operating noninterest expense (Non-GAAP)/average assets2 | 2.35 | % | 2.39 | % | 2.36 | % | 2.34 | % | 2.33 | % | ||||||||||
| Operating Pre-provision Net revenue ("PPNR") Earnings: | ||||||||||||||||||||
| Net interest income (GAAP) | $ | 31,721 | $ | 31,517 | $ | 31,006 | $ | 31,575 | $ | 35,982 | ||||||||||
| Operating noninterest income (Non-GAAP) | 7,034 | 7,579 | 7,492 | 7,130 | 6,925 | |||||||||||||||
| Operating noninterest expense (Non-GAAP) | (28,553 | ) | (28,770 | ) | (28,406 | ) | (27,410 | ) | (27,529 | ) | ||||||||||
| Operating PPNR earnings (Non-GAAP) | $ | 10,202 | $ | 10,326 | $ | 10,092 | $ | 11,295 | $ | 15,378 | ||||||||||
| Non-GAAP Return Ratios: | ||||||||||||||||||||
| Operating return on average assets (Non-GAAP)3 | 0.69 | % | 0.57 | % | 0.60 | % | 0.75 | % | 0.97 | % | ||||||||||
| Operating PPNR return on average assets (Non-GAAP)4 | 0.84 | % | 0.86 | % | 0.84 | % | 0.96 | % | 1.30 | % | ||||||||||
| Return on average tangible common equity (Non-GAAP)5 | 10.62 | % | 7.18 | % | 2.43 | % | 10.57 | % | 14.45 | % | ||||||||||
| Operating return on average shareholders' equity (Non-GAAP)6 | 7.29 | % | 6.07 | % | 6.41 | % | 7.98 | % | 10.79 | % | ||||||||||
| Operating return on average tangible common equity (Non-GAAP)7 | 9.49 | % | 7.98 | % | 8.46 | % | 10.57 | % | 14.45 | % | ||||||||||
| Operating Efficiency Ratio: | ||||||||||||||||||||
| Efficiency ratio (GAAP) | 71.20 | % | 75.95 | % | 89.96 | % | 70.82 | % | 64.16 | % | ||||||||||
| Adjustment for taxable equivalent yields | (0.17 | ) | % | (0.18 | ) | % | (0.27 | ) | % | (0.18 | ) | % | (0.14 | ) | % | |||||
| Adjustment for securities gains (losses) | — | % | — | % | (15.89 | ) | % | — | % | — | % | |||||||||
| Adjustment for sale of branch location | 2.46 | % | — | % | — | % | — | % | — | % | ||||||||||
| Adjustment for donation of a former branch location | — | % | (0.64 | ) | % | — | % | — | % | — | % | |||||||||
| Adjustment for accruals for pending litigation | — | % | (1.72 | ) | % | — | % | — | % | — | % | |||||||||
| Adjustment for merger related income and costs | — | % | — | % | (0.20 | ) | % | — | % | — | % | |||||||||
| Operating efficiency ratio (Non-GAAP) | 73.50 | % | 73.41 | % | 73.60 | % | 70.64 | % | 64.02 | % | ||||||||||
1Operating noninterest income (Non-GAAP) is annualized and divided by average assets.
2Operating noninterest expense (Non-GAAP) is annualized and divided by average assets.
3Operating return on average assets (Non-GAAP) is the annualized operating earnings (Non-GAAP) divided by average assets.
4Operating PPNR return on average assets (Non-GAAP) is the annualized operating PPNR earnings (Non-GAAP) divided by average assets.
5Return on average tangible common equity (Non-GAAP) is the annualized net income divided by average tangible common equity (Non-GAAP).
6Operating return on average shareholders’ equity (Non-GAAP) is the annualized operating earnings (Non-GAAP) divided by average equity.
7Operating return on average tangible common equity (Non-GAAP) is the annualized operating earnings (Non-GAAP) divided by average tangible common equity (Non-GAAP).
SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information - (unaudited)
(dollars in thousands)
NON-GAAP RECONCILIATIONS
| Three Months Ended | |||||||||||||||||||
| Mar | Dec | Sep | Jun | Mar | |||||||||||||||
| 2024 | 2023 | 2023 | 2023 | 2023 | |||||||||||||||
| Tangible Common Equity: | |||||||||||||||||||
| Shareholders' equity (GAAP) | $ | 466,796 | $ | 459,886 | $ | 446,652 | $ | 444,847 | $ | 443,399 | |||||||||
| Less goodwill and other intangible assets | 106,537 | 107,148 | 107,792 | 108,439 | 109,114 | ||||||||||||||
| Tangible common equity (Non-GAAP) | $ | 360,259 | $ | 352,738 | $ | 338,860 | $ | 336,408 | $ | 334,285 | |||||||||
| Average Tangible Common Equity: | |||||||||||||||||||
| Average shareholders' equity (GAAP) | $ | 461,148 | $ | 449,526 | $ | 445,432 | $ | 444,283 | $ | 432,382 | |||||||||
| Less average goodwill and other intangible assets | 106,920 | 107,551 | 108,194 | 108,851 | 109,537 | ||||||||||||||
| Average tangible common equity (Non-GAAP) | $ | 354,228 | $ | 341,975 | $ | 337,238 | $ | 335,432 | $ | 322,845 | |||||||||
| Tangible Book Value per Common Share: | |||||||||||||||||||
| Book value per common share (GAAP) | $ | 27.37 | $ | 27.07 | $ | 26.28 | $ | 26.16 | $ | 26.08 | |||||||||
| Adjustment due to goodwill and other intangible assets | (6.25 | ) | (6.31 | ) | (6.34 | ) | (6.38 | ) | (6.42 | ) | |||||||||
| Tangible book value per common share (Non-GAAP)1 | $ | 21.12 | $ | 20.76 | $ | 19.94 | $ | 19.78 | $ | 19.66 | |||||||||
| Tangible Common Equity to Tangible Assets: | |||||||||||||||||||
| Total Assets (GAAP) | $ | 4,954,690 | $ | 4,829,387 | $ | 4,797,171 | $ | 4,745,800 | $ | 4,769,805 | |||||||||
| Less goodwill and other intangibles | 106,537 | 107,148 | 107,792 | 108,439 | 109,114 | ||||||||||||||
| Tangible Assets (Non-GAAP) | $ | 4,848,153 | $ | 4,722,239 | $ | 4,689,379 | $ | 4,637,361 | $ | 4,660,691 | |||||||||
| Tangible common equity to tangible assets (Non-GAAP) | 7.43 | % | 7.47 | % | 7.23 | % | 7.25 | % | 7.17 | % | |||||||||
1Tangible book value per share (Non-GAAP) is computed by dividing total shareholders’ equity, less goodwill and other intangible assets, by common shares outstanding.
