Third Quarter 2020 Highlights
- Total assets grew $731 million, or 30%, year-over-year to $3.18
billion at September 30, 2020.
- Total deposits grew $615 million, or 29%, year-over-year to
$2.72 billion at September 30, 2020.
- Loans held for investment grew $22.0 million, or 1.3%,
year-over-year to $1.70 billion at September 30, 2020.
- Cash and liquid investments securities grew $688 million, or
104%, year-over-year to $1.35 billion, or 42% of total assets, at
September 30, 2020.
- Tangible book value per share increased $2.07, or 13.3%,
year-over-year to $17.66 at September 30, 2020.
- Tangible equity plus allowance for credit losses totaled $373
million, or 22.0% of total loans held for investment, at September
30, 2020, which provides overall credit protection for both
expected and unexpected credit losses in its loan portfolio.
- Return on average assets was 1.58% and return on average equity
was 12.57% for the nine months ended September 30, 2020.
Altabancorp™ (Nasdaq: ALTA) (the “Company” or “Alta”), the
parent company of Altabank™, reported net income of $11.3 million
for the third quarter of 2020 compared with $10.3 million for the
second quarter of 2020, and $11.1 million for the third quarter of
2019. Diluted earnings per common share were $0.60 for the third
quarter of 2020 compared with $0.55 for the second quarter of 2020,
and $0.59 for the third quarter of 2019.
Annualized return on average assets was 1.47% for the third
quarter of 2020 compared with 1.52% for the second quarter of 2020,
and 1.88% for the third quarter of 2019. Annualized return on
average equity was 12.62% for the third quarter of 2020 compared
with 12.06% for the second quarter of 2020, and 13.79% for the
third quarter of 2019.
The Board of Directors declared a quarterly dividend payment of
$0.15 per common share. The dividend will be payable on November
16, 2020 to shareholders of record as of November 9, 2020. The
dividend payout ratio for earnings for the third quarter of 2020
was 24.9%. This continues the over 50-year trend of paying
dividends by the Company.
“We are pleased with the results we achieved in the third
quarter as we continue to actively manage the negative effects of
the COVID-19 pandemic,” said Len Williams, President and Chief
Executive Officer of Altabancorp™. "Our mortgage banking team is
one area, in particular, that has performed well. Mortgage banking
revenues grew 67% for the year compared with a year ago, reflecting
strong refinance demand and higher margins due to decline in
overall interest rates.”
Mr. Williams continued, “Our strong balance sheet provides
safety and security to our stakeholders as we work through the
negative effects of the pandemic. We believe our balance sheet
strength is reflected in the level of allowance for credit losses
held by us, and our strong regulatory capital position. In
addition, our focus to reduce loan concentrations in our ADC and
commercial real estate portfolios and the tightening of our overall
underwriting standards, over the past couple of years, will help to
mitigate the potential negative effects the economic shutdown from
the pandemic may have on our loan portfolio. Lastly, our strong
liquidity position provides us the flexibility to aggressively grow
our loan portfolio as the economy begins to recover.
“We continue to focus on the safety and stability of our
associates and their families through the allocation of technology
and resources to ensure that a majority of our associates are able
to work from home. We have also enhanced cleaning protocols for our
office spaces and branch locations to ensure that our associates
and clients feel safe when they visit us. We continue to direct our
attention to our clients, who were financially impacted by the
pandemic. We have provided substantial financial relief to our
clients through participation in government programs as well as our
own payment relief programs. We expect to participate with
additional funding for SBA PPP loans, if passed by the Federal
Government. We will continue to work together with our clients to
ensure that we can provide financial solutions to assist them on
their path to recovery as we all work to overcome the
pandemic.”
COVID-19 Pandemic and Utah Economy
The State of Utah has developed a COVID-19 Transmission Index
(“Transmission Index”), which categorizes levels of transmission as
High, Moderate, or Low. Each county receives a rating every week.
The Company’s COVID-19 pandemic response plan directly correlates
to the State’s Transmission Index. The counties where our branches
are located presently have a Transmission Index of Moderate or
greater. As a result, all of our branch lobbies are available by
appointment only, while our drive-up windows remain open. To ensure
the safety of our associates and clients, we require masks to be
worn in all branch locations and in our back office locations, when
associates are unable to socially distance from other associates.
Approximately 60% of our workforce remains working from home and
will continue to do so until the Transmission Index in the
corresponding county moves to Low.
The Company is fortunate to operate in a region that appears to
be weathering the COVID-19 pandemic fairly well economically. The
Utah economy has performed better than the nation as a whole during
the pandemic with the Utah unemployment rate at 5.0% at the end of
September 2020 compared with 7.9% for the nation for the same
period. Commercial and consumer construction activities remain
strong with overall construction jobs increasing 6.6%
year-over-year. Utah’s total personal income rose 4.3% in the first
quarter of 2020 compared with the first quarter of 2019. Utah’s
growth rate ranked seventh in the nation. Nationally, personal
income only increased 3.3% over the same period. Utah’s house
prices were up 1.28% in the second quarter of 2020 from the first
quarter of 2020.
The Company expects that the Utah economy will continue to
perform better than most states in the U.S.
Small Business Administration Paycheck Protection Program
(“SBA PPP”)
The Company funded 333 loans, totaling $84.6 million under the
SBA‘s PPP loan program. As of the date of this earnings release,
the Company has filed 62 applications, or 19%, with the SBA,
totaling $19.0 million and has received loan forgiveness on 15
loans, totaling $0.8 million. As of the date of this earnings
release, the Company has not received a denial on any application
submitted to the SBA for loan forgiveness. The Company is
participating in the PPPL facility offered by the Federal Reserve
to fund SBA PPP loans and to receive regulatory capital relief for
such loans. The Company expects to have most of its SBA PPP loans
forgiven by the end of the second quarter 2021.
Loan Accommodations
The Company offered a temporary loan payment relief program of
deferments up to six months to borrowers impacted by the COVID-19
pandemic. Under rare circumstances, deferred loans will be
re-evaluated at the end of the deferral period. To qualify for a
second loan deferral, the Company will require a full
re-underwriting of the credit.
As of the date of this earnings release, the Company offered
temporary loan payment relief to 415 businesses and 108 individuals
totaling approximately $320 million, or 18.5% of total loans,
excluding SBA PPP loans, to address cash flow challenges for those
impacted by the COVID-19 pandemic. To the date of this earning
release, the deferral period had ended for 237 borrowers, or
45.49%, for loans totaling $128 million. This leaves 284 borrowers,
or 54.51%, for loans totaling $191 million still on deferral. There
are only four borrowers on small balance loans totaling $0.07
million, who have not made a subsequent loan payment for 30 days or
greater, after their payment deferment agreement expired. We have
not entered into another loan payment deferment agreement with any
borrower, who has entered into a previous loan payment deferment
agreement. Since these loans were performing loans that were
current on their payments prior to the COVID-19 pandemic, these
modifications are not considered to be troubled debt restructurings
pursuant to applicable accounting and regulatory guidance.
Loan Credit Quality Trends
Non-performing loans decreased to $6.9 million at September 30,
2020 compared with $8.8 million at December 31, 2019.
Non-performing loans to total loans were 0.41% at September 30,
2020 compared with 0.53% at December 31, 2019. Non-performing
assets decreased to $6.9 million at September 30, 2020 compared
with $8.8 million at December 31, 2019. Non-performing assets to
total assets were 0.22% at September 30, 2020 compared with 0.37%
at December 31, 2019.
Allowance for Credit Losses
The allowance for credit losses increased $11.0 million, or
36.18%, to $41.5 million at September 30, 2020 compared with $30.5
million the same period a year ago. The allowance for credit losses
to loans held for investment was 2.45% at September 30, 2020
compared with 1.82% at September 30, 2019.
Loans
Loans held for investment grew $22.0 million, or 1.3%, to $1.70
billion at September 30, 2020 compared with $1.68 billion at
September 30, 2019. Quarter-to-date average loans increased $11.6
million, or 0.69%, to $1.69 billion for the three months ended
September 30, 2020 compared with $1.68 billion for the three months
ended September 30, 2019. Loans held for sale increased $12.3
million, or 63.00%, to $31.9 million at September 30, 2020 because
of increased mortgage loan volume.
Deposits and Liabilities
Total deposits increased $615 million, or 29.27%, to $2.72
billion at September 30, 2020 compared with $2.10 billion at
September 30, 2019. Non-interest bearing deposits increased, $261
million, or 33.58%, to $1.0 billion at September 30, 2020 compared
with the same period a year earlier, and interest bearing deposits
increased, $354 million, or 26.73%, to $1.68 billion at September
30, 2020 compared with the same period a year ago.
Non-interest-bearing deposits to total deposits were 38.21% as of
September 30, 2020 compared with 36.97% as of September 30,
2019.
Shareholders’ Equity
Shareholders’ equity increased by $37.6 million, or 11.64%, to
$360 million at September 30, 2020 compared with $323 million at
September 30, 2019. The increase resulted primarily from net income
earned during the intervening periods; change in accumulated other
comprehensive income resulting from changes in the fair market
value of investment securities available for sale, due to a decline
in overall interest rates; and cash dividends paid to
shareholders.
The Company’s Leverage capital ratio was 10.87% at September 30,
2020 compared with 12.64% at September 30, 2019. The total
risk-based capital ratio was 19.13% at September 30, 2020 compared
with 17.88% at September 30, 2019. The Company’s regulatory capital
ratios were negatively impacted by the adoption of ASU 2016-13
(“CECL”) and the Company election to take the full impact of such
adoption against its regulatory capital ratios during the first
quarter of 2020.
Net Interest Income and Margin
For the three months ended September 30, 2020, net interest
income decreased $2.4 million, or 8.50%, to $25.8 million compared
with $28.2 million for the same period a year earlier. The decrease
is primarily the result of net interest margins narrowing 152 basis
points to 3.52% for the same comparable periods. The narrowing of
net interest margins is primarily the result of the Federal Reserve
reducing benchmark rates to almost zero and an increase in the
average amount of lower yielding cash and investment securities
held by the Company stemming from average core deposits increasing
$592 million, or 29.48%, for the same respective periods offset by
average interest earning assets increasing $696 million, or 31.33%,
to $2.92 billion for the same comparable periods. The percentage of
average loans to total average interest earning assets decreased to
58.11% for the three months ended September 30, 2020 compared with
75.80% for the same period a year earlier.
Yields on interest earning assets declined 171 basis points to
3.74% for the three months ended September 30, 2020 compared with
5.45% for the same period a year earlier. The decline in yields on
interest earning assets is primarily the result of the average
amount of cash and investment securities held by the Company
increasing $684 million, or 128%, to $1.22 billion for the same
comparable periods with the yield on cash and securities declining
70 basis points to 1.49% for the third quarter of 2020 compared
with 2.19% for the same comparable periods. In addition, the yield
on loans declined 112 basis points to 5.37% compared with 6.49% for
the same comparable periods. Average loans outstanding increased
$11.6 million, or 0.69%, to $1.69 billion for the same comparable
periods.
For the three months ended September 30, 2020, total cost of
interest bearing liabilities decreased 32 basis points to 0.38%
compared with 0.70% for the same period a year earlier, and is
primarily the result of the cost of interest bearing deposits
decreasing 32 basis points to 0.38% compared with 0.70% for the
same period a year ago. For the three months ended September 30,
2020, the total cost of funds decreased 20 basis points to 0.25%
compared with 0.45% for the same period a year ago.
For the three months ended September 30, 2020, acquisition
accounting adjustments, including the accretion of loan discounts
and fair value amortization on time deposits, added 7 basis points
to net interest margin.
For the nine months ended September 30, 2020, net interest
income decreased $4.0 million, or 4.84%, to $78.8 million compared
with $82.8 million for the same period a year earlier. The decrease
is primarily the result of net interest margins narrowing 115 basis
points to 4.04% for the same comparable periods. The narrowing of
net interest margins is primarily the result of the Federal Reserve
reducing benchmark rates to almost zero and an increase in the
average amount of lower yielding cash and investment securities
held by the Company stemming from average core deposits increasing
$407 million, or 21.05%, for the same respective periods offset by
average interest earning assets increasing $472 million, or 22.08%,
to $2.61 billion for the same comparable periods. The percentage of
average loans to total average interest earning assets decreased to
64.80% for the nine months ended September 30, 2020 compared with
78.76% for the same period a year earlier.
Yields on interest earning assets declined 130 basis points to
4.32% for the nine months ended September 30, 2020 compared with
5.62% for the same period a year earlier. The decline in yields on
interest earning assets is primarily the result of the average
amount of cash and investment securities held by the Company
increasing $464 million, or 103%, to $915 million for the same
comparable periods with the yield on cash and securities decreasing
38 basis points to 1.28% for the same comparable periods. In
addition, the yield on loans declined 80 basis points for the same
comparable periods and average loans outstanding increased $7.4
million, or 0.44%, to $1.69 billion for the same comparable
periods.
For the nine months ended September 30, 2020, total cost of
interest bearing liabilities decreased 25 basis points to 0.47%
compared with 0.72% for the same period a year earlier, and is the
result of the cost of short-term borrowings decreasing 228 basis
points to 0.35%, as well as cost of interest bearing deposits
decreasing 24 basis points to 0.48% compared with 0.72% for the
same period a year ago. For the nine months ended September 30,
2020, the total cost of funds decreased 16 basis points to 0.31%
compared with 0.47% for the same period a year ago.
For the nine months ended September 30, 2020, acquisition
accounting adjustments, including the accretion of loan discounts
and fair value amortization on time deposits, added 9 basis points
to net interest margin.
Provision for Credit Losses
For the three months ended September 30, 2020, the Company did
not record any provision for credit losses compared with $2.1
million for the same period a year earlier as calculated under the
prior incurred loss methodology. The provisions for the current and
preceding two quarters reflect expected lifetime credit losses
based upon the current conditions and the potential effects from
forecasted deterioration of economic metrics due to the COVID-19
pandemic based on the outlook as of September 30, 2020. The
decrease in provision for loan losses in the three months ended
September 30, 2020 compared with the same period a year earlier is
due primarily to an $11 million, or 60.18%, decline in loans
individually evaluated for impairment to $7.4 million and the
related allowance for impairment of $4.4 million offset by a $49
million, or 3.00%, increase in loans collectively evaluated for
impairment to $1.6 billion and the related allowance of $37.1
million. For the three months ended September 30, 2020, the Company
incurred net charge-offs of $1.2 million compared with net
recoveries of $0.3 million for the same period a year ago.
For the nine months ended September 30, 2020, provision for
credit losses was $2.8 million compared with $5.8 million for the
same period a year earlier as calculated under the prior incurred
loss methodology. For the nine months ended September 30, 2020, the
Company incurred net charge-offs of $2.1 million compared with net
charge-offs of $0.6 million for the same period a year ago.
“Our overall asset quality trends have improved throughout 2020
and charge-offs across our portfolios have remained relatively
low,” said Mark Olson, Executive Vice President and Chief Financial
Officer of Altabancorp™. “We expect to see asset quality trends
begin to deteriorate and charge-offs to increase beginning in 2021
as the positive effects of government stimulus and loan payment
relief programs come to an end. We believe the allowance for credit
losses is adequate to cover our current expected credit losses.
However, we will continue to closely monitor macroeconomic
conditions and the overall performance of our loan portfolio to
determine if we should adjust our expectations of credit
losses.”
Noninterest Income
For the three months ended September 30, 2020, noninterest
income increased $1.7 million, or 36.94%, to $6.1 million compared
with $4.5 million the same period a year ago. The increase was
primarily due to a $1.7 million, or 81.95%, increase in mortgage
banking income to $3.9 million compared with $2.1 million for the
same period a year ago resulting from higher volume and wider
margins on loans sold, which was favorably impacted by an increase
in mortgage loan refinances, as overall interest rates
declined.
For the nine months ended September 30, 2020, noninterest income
increased $4.6 million, or 40.09%, to $15.97 million compared with
$11.4 million for the same period a year earlier. The increase in
noninterest income was primarily due to a $3.4 million, or 66.78%,
increase in mortgage banking income and a $1.4 million gain on the
sale of investment securities.
“We expect to continue to see improving noninterest income as we
expand our mortgage banking operations both in Utah and surrounding
states and reap the benefits of a significant investment in the
technology used in our mortgage operations from an operational
efficiency and enhanced client experience perspective,” said Mr.
Williams.
Noninterest Expense
For the three months ended September 30, 2020, noninterest
expense was $16.9 million compared with $16.1 million for the same
period a year earlier. For the three months ended September 30,
2020, the Company’s efficiency ratio was 52.86% compared with
49.20% for the same period a year ago.
For the nine months ended September 30, 2020, noninterest
expense was $49.3 million compared with $45.7 million for the same
period a year earlier. For the nine months ended September 30,
2020, the Company’s efficiency ratio was 52.02% compared with
48.49% for the same period a year ago.
The increase in noninterest expense for both the three and nine
months ended September 30, 2020 was primarily the result of higher
salaries and associate benefits resulting primarily from higher
incentive payments, particularly in the mortgage banking division.
In addition, the Company has incurred higher data processing
expenses due to investments made in new technologies for the
mortgage banking division; technology investments made in the
commercial banking division, including costs for its cloud-based,
commercial loan origination application (nCino), including
automated processes for smaller ticket commercial loans (titled
Altaexpress™), costs for the implementation of a Salesforce CRM
solution, costs for a new cloud-based, commercial client treasury
management solution; and costs for a new cloud-based, construction
budget, draw and inspection management solution for both commercial
and consumer clients. The Company expects to continue to make
significant investments in new technologies to enhance its client’s
experience and empower clients to transact more business on its
mobile platform; to lower the overall costs of its operating
platform; and to become more scalable as the Company aggressively
evaluates acquisition opportunities.
Noninterest expense also increased from higher marketing and
advertising expenses, because of continued efforts to improve
overall brand recognition in the regional markets in which the
Company operates.
“We anticipate overall interest rates to remain near zero for
the foreseeable future,” said Mr. Olson. “As a result, we continue
to review our overall operating costs to determine how we can
better leverage our platform, while retaining our high-touch client
experience. We anticipate making changes over the next several
quarters to improve our operating leverage.”
Income Tax Provision
For the three months ended September 30, 2020, income tax
expense was $3.7 million compared with $3.4 million for the same
period a year earlier. For the three months ended September 30,
2020, the effective tax rate was 24.62% compared with 23.15% for
the same period a year ago.
For the nine months ended September 30, 2020, income tax expense
was $10.3 million compared with $10.1 million for the same period a
year earlier. For the nine months ended September 30, 2020, the
effective tax rate was 24.05% compared with 23.65% for the same
period a year ago.
Conference Call and Webcast
Management will host a conference call on Thursday, October 29,
2020 at 10:00 a.m. MDT (12:00 p.m. EDT) to discuss the Company’s
financial performance.
Interested parties may listen to the call live at
www.altabancorp.com. Investment professionals, who wish to ask
questions regarding the Company’s financial performance, will need
to register to participate in the call by October 28, 2020 by
visiting http://www.directeventreg.com/registration/event/6513568.
Upon registering, you will receive a confirmation with dial-in
details. Please dial in 10-15 minutes early so your name and your
company information may be collected prior to the start of the
conference. The Company’s third quarter earnings release and
investor presentation will be available prior to the call on the
Company’s investor relations website. An audio archive and written
transcript of the conference call will be available on the
Company’s investor website within 24 hours after the end of the
call. Forward-looking statements may be made and other material
information may be discussed on this conference call.
Forward-Looking Statements
This press release may contain certain forward-looking
statements that are based on management's current expectations
regarding the Company’s financial performance. Forward-looking
statements can be identified by the fact that they do not relate
strictly to historical or current facts. They often include the
words “believe,” “expect,” “intend,” “estimate” or words of similar
meaning, or future or conditional verbs such as “will,” “would,”
“should,” “could” or “may.” Factors that could cause future results
to vary materially from current management expectations include,
but are not limited to, the duration and impact of the COVID-19
pandemic, natural disasters, general economic conditions, economic
uncertainty in the United States, changes in interest rates,
deposit flows, real estate values, costs or effects of
acquisitions, competition, changes in accounting principles,
policies or guidelines, legislation or regulation, and other
economic, competitive, governmental, regulatory and technological
factors (including external fraud and cybersecurity threats)
affecting the Company's operations, pricing, products and services.
These and other important factors are detailed in the Company’s
Form 10-K, Form 10-Qs, and various other securities law filings
made periodically by the Company, copies of which are available
from the Company’s website. The Company undertakes no obligation to
release publicly the result of any revisions to these
forward-looking statements that may be made to reflect events or
circumstances after the date of this press release or to reflect
the occurrence of unanticipated events, except as required by
law.
About Altabancorp™
Altabancorp™ (Nasdaq: ALTA) is the bank holding company for
Altabank™, a full-service bank, providing loans, deposit and cash
management services to businesses and individuals through 26 branch
locations from Preston, Idaho to St. George, Utah. Altabank™ is the
largest community bank in Utah with total assets of $3.2 billion.
Our clients have direct access to bankers and decision-makers, who
work with clients to understand their specific needs and offer
customized financial solutions. Altabank™ has been serving
communities in Utah and southern Idaho for more than 100 years.
More information about Altabank™ is available at www.altabank.com.
More information about Altabancorp™ is available at
www.altabancorp.com.
ALTABANCORP™
UNAUDITED CONSOLIDATED
STATEMENTS OF INCOME
Three Months Ended
Nine Months Ended
(Dollars in thousands, except
share
September 30,
June 30,
September 30,
September 30,
September 30,
and per share amounts)
2020
2020
2019
2020
2019
Interest income
Interest and fees on loans
$
22,896
$
23,649
$
27,544
$
72,470
$
82,152
Interest and dividends on investments
4,551
3,753
2,937
11,763
7,531
Total interest income
27,447
27,402
30,481
84,233
89,683
Interest expense
1,651
1,613
2,290
5,427
6,865
Net interest income
25,796
25,789
28,191
78,806
82,818
Provision for credit losses
-
2,100
2,100
2,750
5,800
Net interest income after provision for
credit losses
25,796
23,689
26,091
76,056
77,018
Noninterest income
Mortgage banking
3,850
3,036
2,116
8,596
5,154
Card processing
986
917
976
2,610
2,405
Service charges on deposit accounts
813
763
744
2,356
2,106
Net gain on sale of investment
securities
-
1,441
-
1,441
-
Other
468
(41
)
631
970
1,737
Total non-interest income
6,117
6,116
4,467
15,973
11,402
Noninterest expense
Salaries and employee benefits
11,107
10,786
10,410
32,737
29,822
Occupancy, equipment and depreciation
1,155
831
1,439
3,525
4,453
Data processing
1,647
2,383
1,280
5,166
3,262
Marketing and advertising
584
339
805
1,355
1,147
FDIC premiums
183
165
6
348
244
Other
2,193
1,771
2,128
6,174
6,755
Total non-interest expense
16,869
16,275
16,068
49,305
45,683
Income before income tax
expense
15,044
13,530
14,490
42,724
42,737
Income tax expense
3,704
3,192
3,355
10,273
10,108
Net income
$
11,340
$
10,338
$
11,135
$
32,451
$
32,629
Earnings per common share:
Basic
$
0.60
$
0.55
$
0.59
$
1.72
$
1.73
Diluted
$
0.60
$
0.55
$
0.59
$
1.71
$
1.72
Weighted average common shares
outstanding:
Basic
18,796,401
18,789,561
18,840,381
18,823,507
18,809,334
Diluted
18,934,123
18,932,511
19,029,350
18,968,129
19,008,883
ALTABANCORP™
UNAUDITED CONSOLIDATED BALANCE
SHEETS
September 30,
June 30,
December 31,
September 30,
(Dollars in thousands, except share
amounts)
2020
2020
2019
2019
ASSETS
Cash and due from banks
$
44,137
$
47,088
$
38,987
$
45,196
Interest-bearing deposits
180,773
275,920
171,955
195,082
Federal funds sold
74
829
1,039
100,118
Total cash and cash equivalents
224,984
323,837
211,981
340,396
Investment securities:
Available for sale, at fair value
1,123,051
973,457
405,995
319,857
Non-marketable equity securities
2,890
2,890
2,623
2,623
Loans held for sale
31,872
29,264
18,669
19,554
Loans:
Loans held for investment
1,697,135
1,659,018
1,680,918
1,675,147
Allowance for credit losses
(41,495
)
(42,683
)
(31,426
)
(30,471
)
Total loans held for investment,
net
1,655,640
1,616,335
1,649,492
1,644,676
Premises and equipment, net
37,966
38,673
39,474
37,958
Goodwill
25,673
25,673
25,673
25,673
Bank-owned life insurance
42,312
27,330
27,037
26,885
Deferred income tax assets
7,842
8,586
9,716
9,169
Accrued interest receivable
14,117
11,682
7,904
8,850
Other intangibles
2,638
2,749
2,970
3,080
Other real estate owned
-
-
-
-
Other assets
6,376
5,169
4,800
5,742
Total assets
$
3,175,361
$
3,065,645
$
2,406,334
$
2,444,463
LIABILITIES AND SHAREHOLDERS’
EQUITY
Deposits:
Non-interest bearing deposits
$
1,037,970
$
985,455
$
719,410
$
777,041
Interest-bearing deposits
1,678,809
1,627,884
1,336,957
1,324,671
Total deposits
2,716,779
2,613,339
2,056,367
2,101,712
Short-term borrowings
83,490
83,490
-
-
Accrued interest payable
487
408
546
571
Other liabilities
14,315
18,278
17,059
19,461
Total liabilities
2,815,071
2,715,515
2,073,972
2,121,744
Shareholders’ equity:
Preferred shares, $0.01 par value
-
-
-
-
Common shares, $0.01 par value
188
188
189
189
Additional paid-in capital
87,116
86,721
87,913
87,704
Retained earnings
260,929
252,032
242,878
233,634
Accumulated other comprehensive
income/(loss)
12,057
11,189
1,382
1,192
Total shareholders’ equity
360,290
350,130
332,362
322,719
Total liabilities and shareholders’
equity
$
3,175,361
$
3,065,645
$
2,406,334
$
2,444,463
Common shares outstanding
18,802,635
18,793,217
18,870,498
18,855,710
ALTABANCORP™
SUMMARY FINANCIAL
INFORMATION
September 30,
June 30,
December 31,
September 30,
(Dollars in thousands, except share
amounts)
2020
2020
2019
2019
Selected Balance Sheet
Information:
Book value per share
$
19.16
$
18.63
$
17.61
$
17.12
Tangible book value per share
$
17.66
$
17.12
$
16.09
$
15.59
Non-performing loans to total loans
0.41
%
0.39
%
0.53
%
0.26
%
Non-performing assets to total assets
0.22
%
0.21
%
0.37
%
0.17
%
Allowance for credit losses to loans held
for investment
2.45
%
2.57
%
1.87
%
1.82
%
Loans to deposits
62.11
%
62.97
%
81.12
%
79.18
%
Asset Quality Data:
Non-performing loans
$
6,944
$
6,388
$
8,814
$
4,255
Non-performing assets
$
6,944
$
6,388
$
8,814
$
4,255
Capital Ratios:
Tier 1 leverage capital (1)
10.87
%
11.68
%
12.67
%
12.64
%
Total risk-based capital (1)
19.13
%
19.20
%
18.43
%
17.88
%
Average equity to average assets
11.68
%
12.57
%
13.63
%
13.66
%
Tangible common equity to tangible assets
(2)
10.55
%
10.59
%
12.77
%
12.17
%
Three Months Ended
Nine Months Ended
September 30,
June 30,
September 30,
September 30,
September 30,
2020
2020
2019
2020
2019
Selected Financial Information:
Basic earnings per share
$
0.60
$
0.55
$
0.59
$
1.72
$
1.73
Diluted earnings per share
$
0.60
$
0.55
$
0.59
$
1.71
$
1.72
Net interest margin (3)
3.52
%
3.96
%
5.04
%
4.04
%
5.19
%
Efficiency ratio
52.86
%
51.01
%
49.20
%
52.02
%
48.49
%
Non-interest income to average assets
0.79
%
0.90
%
0.76
%
0.78
%
0.67
%
Non-interest expense to average assets
2.19
%
2.39
%
2.72
%
2.41
%
2.70
%
Annualized return on average assets
1.47
%
1.52
%
1.88
%
1.58
%
1.93
%
Annualized return on average equity
12.62
%
12.06
%
13.79
%
12.57
%
14.16
%
Net charge-offs
$
1,188
$
670
$
(332
)
$
2,147
$
574
Annualized net charge-offs to average
loans
0.28
%
0.16
%
-0.08
%
0.17
%
0.05
%
________________________________
(1) Tier 1 leverage capital and Total risk-based capital as of
September 30, 2020 are estimates.
(2) Represents the sum of total shareholders’ equity less
intangible assets all divided by the sum of total assets less
intangible assets. Intangible assets were $ 28.3 million, $28.4
million, $28.6 million, and $28.8 million at September 30, 2020,
June 30, 2020, December 31, 2019, and September 30, 2019,
respectively.
(3) Net interest margin is defined as net interest income
divided by average earning assets.
ALTABANCORP™
SELECTED AVERAGE BALANCES AND
YIELDS
Three Months Ended
September 30, 2020
September 30, 2019
Interest
Average
Interest
Average
Average
Income/
Yield/
Average
Income/
Yield/
(Dollars in thousands, except
footnotes)
Balance
Expense
Rate
Balance
Expense
Rate
ASSETS
Interest-earning deposits in other banks
and federal funds sold
$
217,220
$
51
0.09
%
$
213,320
$
1,161
2.16
%
Securities: (1)
Taxable securities
961,025
4,274
1.77
%
259,870
1,459
2.23
%
Non-taxable securities (2)
40,625
204
2.00
%
61,692
295
1.90
%
Total securities
1,001,650
4,478
1.78
%
321,562
1,754
2.16
%
Loans (3)
Real estate term
968,473
13,297
5.46
%
909,671
13,881
6.05
%
Construction and land development
241,399
3,876
6.39
%
299,908
6,020
7.96
%
Commercial and industrial
296,999
3,878
5.19
%
281,948
4,873
6.86
%
Residential and home equity
176,265
1,653
3.73
%
174,104
2,513
5.73
%
Consumer and other
11,686
192
6.55
%
17,611
257
5.81
%
Total loans
1,694,822
22,896
5.37
%
1,683,242
27,544
6.49
%
Non-marketable equity securities
2,890
22
3.02
%
2,624
22
3.32
%
Total interest-earning assets
2,916,582
27,447
3.74
%
2,220,748
30,481
5.45
%
Allowance for credit losses
(42,840
)
(28,284
)
Non-interest earning assets
187,522
152,400
Total average assets
$
3,061,264
$
2,344,864
LIABILITIES AND SHAREHOLDERS’
EQUITY
Interest-bearing deposits:
Demand and savings accounts
$
1,012,180
590
0.23
%
$
805,579
882
0.43
%
Money market accounts
456,543
430
0.37
%
309,328
759
0.97
%
Certificates of deposit
171,089
537
1.25
%
177,850
649
1.45
%
Total interest-bearing deposits
1,639,812
1,557
0.38
%
1,292,757
2,290
0.70
%
Short-term borrowings
83,490
94
0.45
%
-
-
0.00
%
Total interest-bearing
liabilities
1,723,302
1,651
0.38
%
1,292,757
2,290
0.70
%
Non-interest bearing deposits
958,229
713,742
Total funding
2,681,531
1,651
0.25
%
2,006,499
2,290
0.45
%
Other non-interest bearing liabilities
22,255
18,086
Shareholders’ equity
357,478
320,279
Total average liabilities and
shareholders’ equity
$
3,061,264
$
2,344,864
Net interest income
$
25,796
$
28,191
Interest rate spread
3.36
%
4.74
%
Net interest margin
3.52
%
5.04
%
________________________________
(1) Excludes average unrealized gains of
$16.5 million and $1.2 million for the three months ended September
30, 2020 and 2019, respectively.
(2) Does not include tax effect on
tax-exempt investment security income of $68,000 and $98,000 for
the three months ended September 30, 2020 and 2019,
respectively.
(3) Loan interest income includes loan
fees of $1.8 million for both the three months ended September 30,
2020 and 2019, respectively.
ALTABANCORP™
SELECTED AVERAGE BALANCES AND
YIELDS
Nine Months Ended
September 30, 2020
September 30, 2019
Interest
Average
Interest
Average
Average
Income/
Yield/
Average
Income/
Yield/
(Dollars in thousands, except
footnotes)
Balance
Expense
Rate
Balance
Expense
Rate
ASSETS
Interest-earning deposits in other banks
and federal funds sold
$
182,909
$
419
0.31
%
$
113,669
$
1,891
2.22
%
Securities: (1)
Taxable securities
686,319
10,593
2.06
%
271,193
4,635
2.29
%
Non-taxable securities (2)
45,586
687
2.01
%
65,851
929
1.89
%
Total securities
731,905
11,280
2.06
%
337,044
5,564
2.21
%
Loans (3)
Real estate term
950,036
39,929
5.61
%
900,408
40,375
6.00
%
Construction and land development
258,830
13,056
6.74
%
309,651
18,555
8.01
%
Commercial and industrial
293,375
12,670
5.77
%
291,045
15,256
7.01
%
Residential and home equity
174,297
6,174
4.73
%
163,966
7,200
5.87
%
Consumer and other
12,697
641
6.75
%
16,811
766
6.09
%
Total loans
1,689,235
72,470
5.73
%
1,681,881
82,152
6.53
%
Non-marketable equity securities
2,807
64
3.04
%
2,729
76
3.71
%
Total interest-earning assets
2,606,856
84,233
4.32
%
2,135,323
89,683
5.62
%
Allowance for loan losses
(42,398
)
(26,708
)
Non-interest earning assets
171,747
151,123
Total average assets
$
2,736,205
$
2,259,738
LIABILITIES AND SHAREHOLDERS’
EQUITY
Interest-bearing deposits:
Demand and savings accounts
$
918,853
1,909
0.28
%
$
806,553
2,910
0.48
%
Money market accounts
408,549
1,745
0.57
%
278,062
2,040
0.98
%
Certificates of deposit
171,379
1,679
1.31
%
179,664
1,852
1.38
%
Total interest-bearing deposits
1,498,781
5,333
0.48
%
1,264,279
6,802
0.72
%
Short-term borrowings
36,140
94
0.35
%
3,235
63
2.63
%
Total interest-bearing
liabilities
1,534,921
5,427
0.47
%
1,267,514
6,865
0.72
%
Non-interest bearing deposits
839,294
667,263
Total funding
2,374,215
5,427
0.31
%
1,934,777
6,865
0.47
%
Other non-interest bearing liabilities
17,226
16,817
Shareholders’ equity
344,764
308,144
Total average liabilities and
shareholders’ equity
$
2,736,205
$
2,259,738
Net interest income
$
78,806
$
82,818
Interest rate spread
3.84
%
4.89
%
Net interest margin
4.04
%
5.19
%
________________________________
(1) Excludes average unrealized gains
(losses) of $10.4 million and ($2.2) million for the nine months
ended September 30, 2020 and 2019, respectively.
(2) Does not include tax effect on
tax-exempt investment security income of $229,000 and $310,000 for
the nine months ended September 30, 2020 and 2019,
respectively.
(3) Loan interest income includes loan
fees of $5.0 million and $4.9 million for the nine months ended
September 30, 2020 and 2019, respectively.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201029005295/en/
Investor Relations Contact Mark K. Olson Executive Vice
President and Chief Financial Officer Altabancorp™
investorrelations@altabancorp.com Phone: 801-642-3998
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