EX-99.1 2 tbk-ex991_7.htm EX-99.1 tbk-ex991_7.htm

 

Exhibit 99.1

Triumph Bancorp Reports Third Quarter Net Income to Common Stockholders of $9.0 Million

DALLAS – October 17, 2018 (GLOBE NEWSWIRE) – Triumph Bancorp, Inc. (Nasdaq: TBK) (“Triumph”) today announced earnings and operating results for the third quarter of 2018.

As part of how we measure our results, we use certain non-GAAP financial measures to ascertain performance.  These non-GAAP financial measures are reconciled in the section labeled “Metrics and non-GAAP financial reconciliation” at the end of this press release.

2018 Third Quarter Highlights and Recent Developments

 

•

For the third quarter of 2018, net income available to common stockholders was $9.0 million. Diluted earnings per share were $0.34.  

 

•

Adjusted diluted earnings per share were $0.51 for the quarter ended September 30, 2018, which exclude $5.9 million of transaction costs, $4.5 million net of tax, related to our acquisitions of First Bancorp of Durango, Inc. (“FBD”) and Southern Colorado Corp. (“SCC”).

 

•

Effective September 8, 2018, we acquired First Bancorp of Durango, Inc. and its two community banking subsidiaries, The First National Bank of Durango and Bank of New Mexico, in an all-cash transaction for $134.7 million. On the same date, we acquired Southern Colorado Corp. and its community banking subsidiary, Citizens Bank of Pagosa Springs, in an all-cash transaction for $13.3 million. As part of the FBD and SCC acquisitions, we acquired a combined $287.8 million of loans held for investment, assumed a combined $674.7 million of deposits, and recorded a combined $14.1 million of core deposit intangible assets and $72.1 million of goodwill.

 

•

Net income for the quarter ended September 30, 2018 was impacted by the aforementioned transaction costs and $5.8 million of provision for loan loss expense attributable to a single asset based lending relationship previously disclosed in a Form 8-K filing with the Securities and Exchange Commission on September 20, 2018.

 

•

Net interest margin (“NIM”) was 6.59% for the quarter ended September 30, 2018. Adjusted NIM, which excludes loan discount accretion, was 6.45%.

 

•

Total loans held for investment increased $315.7 million, or 9.9%, to $3.512 billion at September 30, 2018. Average loans for the quarter increased $371.7 million, or 12.7%, to $3.294 billion.

 

•

Triumph Business Capital grew period-end clients to 5,932 clients which is an increase of 422 clients, or 7.7%. The total dollar value of invoices purchased for the quarter ended September 30, 2018 was $1.503 billion with an average invoice price of $1,796.  

 

•

At September 30, 2018, Triumph Business Capital had 86 clients utilizing the TriumphPay platform. For the quarter ended September 30, 2018, TriumphPay processed 65,535 invoices paying 16,125 distinct carriers a total of $95.8 million.

Balance Sheet

Total loans held for investment were $3.512 billion at September 30, 2018. We acquired loans held for investment with a combined acquisition date fair value of $287.8 million in the FBD and SCC transactions. Our commercial finance loans, which comprise 37% of the loan portfolio, were $1.284 billion at September 30, 2018, compared to $1.207 billion at June 30, 2018, an increase of $76.6 million, or 6.3% in the third quarter of 2018.  

Total deposits were $3.439 billion at September 30, 2018, an increase of $814.1 million or 31.0% in the third quarter of 2018.  We assumed deposits with a combined acquisition date fair value of $674.7 million in the FBD and SCC transactions. Non-interest-bearing deposits accounted for 20% of total deposits and non-time deposits accounted for 61% of total deposits at September 30, 2018.  

1

 

Net Interest Income

We earned net interest income for the quarter ended September 30, 2018 of $61.8 million compared to $53.3 million for the quarter ended June 30, 2018.

Yields on loans for the quarter ended September 30, 2018 were up 24 bps from the prior quarter to 8.33% (up 59 bps from the prior quarter to 8.18% adjusted to exclude loan discount accretion). The average cost of our total deposits was 0.85% for the quarter ended September 30, 2018 compared to 0.73% for the quarter ended June 30, 2018, on an annualized basis.  

 

Asset Quality

Non-performing assets decreased 35 bps from June 30, 2018 to 0.93% of total assets at September 30, 2018.  The ratio of past due to total loans decreased to 2.23% at September 30, 2018 from 2.54% at June 30, 2018. We recorded total net charge-offs of $4.1 million, or 0.12% of average loans, for the quarter ended September 30, 2018 compared to net charge-offs of $0.4 million, or 0.01% of average loans, for the quarter ended June 30, 2018.  

We recorded a provision for loan losses of $6.8 million for the quarter ended September 30, 2018 which includes the $5.8 million impact attributable to a single asset based lending relationship. We recorded a provision of $4.9 million for the quarter ended June 30, 2018. From June 30, 2018 to September 30, 2018, our ALLL increased from $24.5 million or 0.77% of total loans to $27.3 million or 0.78% of total loans.  

Non-Interest Income and Expense

We earned non-interest income for the quarter ended September 30, 2018 of $6.1 million compared to $4.9 million for the quarter ended June 30, 2018. Non-interest income for the quarter ended September 30, 2018 was negatively impacted by a $0.5 million increase in the fair value of the contingent consideration liability related to the Interstate Capital Corporation acquisition.

For the quarter ended September 30, 2018, non-interest expense totaled $48.9 million, compared to $37.4 million for the quarter ended June 30, 2018. Non-interest expense for the quarter ended September 30, 2018 included transaction costs related to the FBD and SCC acquisitions of $5.9 million. Non-interest expense for the quarter ended June 30, 2018 included transaction costs related to the Interstate Capital Corporation acquisition of $1.1 million.

Conference Call Information

Aaron P. Graft, Vice Chairman and CEO and Bryce Fowler, CFO will review the quarterly results in a conference call for investors and analysts beginning at 7:00 a.m. Central Time on Thursday, October 18, 2018. Dan Karas, Chief Lending Officer, will also be available for questions.

To participate in the live conference call, please dial 1-855-940-9472 (Canada: 1-855-669-9657) and request to be joined into the Triumph Bancorp, Inc. (TBK) call.  A simultaneous audio-only webcast may be accessed via the Company's website at www.triumphbancorp.com through the Investor Relations, News & Events, Webcasts and Presentations links, or through a direct link here at: https://services.choruscall.com/links/tbk181018.html.  An archive of this conference call will subsequently be available at this same location on the Company’s website.

2

 

About Triumph

Triumph Bancorp, Inc. (Nasdaq: TBK) is a financial holding company headquartered in Dallas, Texas.  Triumph offers a diversified line of community banking and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com

Forward-Looking Statements

This press release contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; risks related to the integration of acquired businesses (including our acquisitions of First Bancorp of Durango, Inc., Southern Colorado Corp., the operating assets of Interstate Capital Corporation and certain of its affiliates, Valley Bancorp, Inc., and nine branches from Independent Bank in Colorado) and any future acquisitions; changes in management personnel; interest rate risk; concentration of our factoring services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets, or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally, or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities, and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of the Federal Deposit Insurance Corporation insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 13, 2018.

Non-GAAP Financial Measures

This press release includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided at the end of this press release.


3

 

The following table sets forth key metrics used by Triumph to monitor its operations. Footnotes in this table can be found in our definitions of non-GAAP financial measures at the end of this document.

 

As of and for the Three Months Ended

 

 

As of and for the Nine Months Ended

 

 

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

(Dollars in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

 

2018

 

 

2017

 

Financial Highlights:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

4,537,102

 

 

$

3,794,631

 

 

$

3,405,010

 

 

$

3,499,033

 

 

$

2,906,161

 

 

$

4,537,102

 

 

$

2,906,161

 

Loans held for investment

 

$

3,512,143

 

 

$

3,196,462

 

 

$

2,873,985

 

 

$

2,810,856

 

 

$

2,425,463

 

 

$

3,512,143

 

 

$

2,425,463

 

Deposits

 

$

3,439,049

 

 

$

2,624,942

 

 

$

2,533,498

 

 

$

2,621,348

 

 

$

2,012,545

 

 

$

3,439,049

 

 

$

2,012,545

 

Net income available to common stockholders

 

$

8,975

 

 

$

12,192

 

 

$

11,878

 

 

$

6,111

 

 

$

9,587

 

 

$

33,045

 

 

$

29,335

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performance Ratios - Annualized:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets

 

 

0.90

%

 

 

1.37

%

 

 

1.43

%

 

 

0.79

%

 

 

1.36

%

 

 

1.21

%

 

 

1.46

%

Return on average total equity

 

 

5.88

%

 

 

8.53

%

 

 

12.20

%

 

 

6.35

%

 

 

10.71

%

 

 

8.40

%

 

 

12.44

%

Return on average common equity

 

 

5.85

%

 

 

8.54

%

 

 

12.30

%

 

 

6.30

%

 

 

10.79

%

 

 

8.41

%

 

 

12.58

%

Return on average tangible common equity (1)

 

 

7.57

%

 

 

9.95

%

 

 

14.75

%

 

 

7.33

%

 

 

12.28

%

 

 

10.27

%

 

 

14.65

%

Yield on loans

 

 

8.33

%

 

 

8.09

%

 

 

7.65

%

 

 

7.73

%

 

 

7.44

%

 

 

8.05

%

 

 

7.47

%

Adjusted yield on loans (1)

 

 

8.18

%

 

 

7.59

%

 

 

7.36

%

 

 

7.47

%

 

 

7.20

%

 

 

7.74

%

 

 

7.14

%

Cost of interest bearing deposits

 

 

1.08

%

 

 

0.93

%

 

 

0.86

%

 

 

0.84

%

 

 

0.80

%

 

 

0.96

%

 

 

0.75

%

Cost of total deposits

 

 

0.85

%

 

 

0.73

%

 

 

0.68

%

 

 

0.67

%

 

 

0.64

%

 

 

0.76

%

 

 

0.61

%

Cost of total funds

 

 

1.16

%

 

 

1.06

%

 

 

0.95

%

 

 

0.92

%

 

 

0.90

%

 

 

1.06

%

 

 

0.84

%

Net interest margin

 

 

6.59

%

 

 

6.36

%

 

 

6.06

%

 

 

6.16

%

 

 

5.90

%

 

 

6.35

%

 

 

5.82

%

Adjusted net interest margin (1)

 

 

6.45

%

 

 

5.92

%

 

 

5.81

%

 

 

5.93

%

 

 

5.69

%

 

 

6.08

%

 

 

5.54

%

Net non-interest expense to average assets

 

 

4.19

%

 

 

3.59

%

 

 

3.43

%

 

 

3.65

%

 

 

3.35

%

 

 

3.76

%

 

 

2.63

%

Adjusted net non-interest expense to average assets (1)

 

 

3.62

%

 

 

3.47

%

 

 

3.56

%

 

 

3.43

%

 

 

3.35

%

 

 

3.55

%

 

 

3.40

%

Efficiency ratio

 

 

72.15

%

 

 

64.26

%

 

 

65.09

%

 

 

66.74

%

 

 

64.61

%

 

 

67.50

%

 

 

61.68

%

Adjusted efficiency ratio (1)

 

 

63.49

%

 

 

62.38

%

 

 

66.45

%

 

 

63.35

%

 

 

64.61

%

 

 

63.98

%

 

 

67.82

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Quality:(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Past due to total loans

 

 

2.23

%

 

 

2.54

%

 

 

2.41

%

 

 

2.33

%

 

 

2.22

%

 

 

2.23

%

 

 

2.22

%

Non-performing loans to total loans

 

 

1.13

%

 

 

1.43

%

 

 

1.41

%

 

 

1.38

%

 

 

1.25

%

 

 

1.13

%

 

 

1.25

%

Non-performing assets to total assets

 

 

0.93

%

 

 

1.28

%

 

 

1.47

%

 

 

1.39

%

 

 

1.42

%

 

 

0.93

%

 

 

1.42

%

ALLL to non-performing loans

 

 

68.82

%

 

 

53.57

%

 

 

49.52

%

 

 

48.41

%

 

 

67.33

%

 

 

68.82

%

 

 

67.33

%

ALLL to total loans

 

 

0.78

%

 

 

0.77

%

 

 

0.70

%

 

 

0.67

%

 

 

0.84

%

 

 

0.78

%

 

 

0.84

%

Net charge-offs to average loans

 

 

0.12

%

 

 

0.01

%

 

 

0.05

%

 

 

0.06

%

 

 

0.00

%

 

 

0.19

%

 

 

0.22

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tier 1 capital to average assets(3)

 

 

11.75

%

 

 

15.00

%

 

 

11.23

%

 

 

11.80

%

 

 

13.50

%

 

 

11.75

%

 

 

13.50

%

Tier 1 capital to risk-weighted assets(3)

 

 

11.16

%

 

 

14.68

%

 

 

11.54

%

 

 

11.15

%

 

 

13.45

%

 

 

11.20

%

 

 

13.45

%

Common equity tier 1 capital to risk-weighted assets(3)

 

 

9.96

%

 

 

13.32

%

 

 

10.05

%

 

 

9.70

%

 

 

11.95

%

 

 

10.00

%

 

 

11.95

%

Total capital to risk-weighted assets(3)

 

 

13.05

%

 

 

16.73

%

 

 

13.66

%

 

 

13.21

%

 

 

15.91

%

 

 

13.09

%

 

 

15.91

%

Total equity to total assets

 

 

13.59

%

 

 

16.00

%

 

 

11.83

%

 

 

11.19

%

 

 

13.29

%

 

 

13.59

%

 

 

13.29

%

Tangible common stockholders' equity to tangible assets(1)

 

 

9.35

%

 

 

13.05

%

 

 

9.86

%

 

 

9.26

%

 

 

11.66

%

 

 

9.35

%

 

 

11.66

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share Amounts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Book value per share

 

$

23.10

 

 

$

22.76

 

 

$

18.89

 

 

$

18.35

 

 

$

18.08

 

 

$

23.10

 

 

$

18.08

 

Tangible book value per share (1)

 

$

15.42

 

 

$

18.27

 

 

$

15.82

 

 

$

15.29

 

 

$

16.04

 

 

$

15.42

 

 

$

16.04

 

Basic earnings per common share

 

$

0.34

 

 

$

0.48

 

 

$

0.57

 

 

$

0.29

 

 

$

0.48

 

 

$

1.37

 

 

$

1.58

 

Diluted earnings per common share

 

$

0.34

 

 

$

0.47

 

 

$

0.56

 

 

$

0.29

 

 

$

0.47

 

 

$

1.35

 

 

$

1.53

 

Adjusted diluted earnings per common share(1)

 

$

0.51

 

 

$

0.50

 

 

$

0.52

 

 

$

0.34

 

 

$

0.47

 

 

$

1.53

 

 

$

1.02

 

Shares outstanding end of period

 

 

26,279,761

 

 

 

26,260,785

 

 

 

20,824,509

 

 

 

20,820,445

 

 

 

20,820,900

 

 

 

26,279,761

 

 

 

20,820,900

 



4

 

Unaudited consolidated balance sheet as of:

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

(Dollars in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total cash and cash equivalents

 

$

282,409

 

 

$

133,365

 

 

$

106,046

 

 

$

134,129

 

 

$

80,557

 

Securities - available for sale

 

 

355,981

 

 

 

183,184

 

 

 

192,916

 

 

 

250,603

 

 

 

207,301

 

Securities - held to maturity

 

 

8,403

 

 

 

8,673

 

 

 

8,614

 

 

 

8,557

 

 

 

17,999

 

Equity securities

 

 

4,981

 

 

 

5,025

 

 

 

4,925

 

 

 

5,006

 

 

 

2,025

 

Loans held for sale

 

 

683

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Loans held for investment

 

 

3,512,143

 

 

 

3,196,462

 

 

 

2,873,985

 

 

 

2,810,856

 

 

 

2,425,463

 

Allowance for loan and lease losses

 

 

(27,256

)

 

 

(24,547

)

 

 

(20,022

)

 

 

(18,748

)

 

 

(20,367

)

Loans, net

 

 

3,484,887

 

 

 

3,171,915

 

 

 

2,853,963

 

 

 

2,792,108

 

 

 

2,405,096

 

Assets held for sale

 

 

—

 

 

 

—

 

 

 

—

 

 

 

71,362

 

 

 

—

 

FHLB stock

 

 

23,109

 

 

 

19,223

 

 

 

16,508

 

 

 

16,006

 

 

 

16,076

 

Premises and equipment, net

 

 

82,935

 

 

 

68,313

 

 

 

62,826

 

 

 

62,861

 

 

 

43,678

 

Other real estate owned ("OREO"), net

 

 

2,442

 

 

 

2,528

 

 

 

9,186

 

 

 

9,191

 

 

 

10,753

 

Goodwill and intangible assets, net

 

 

201,842

 

 

 

117,777

 

 

 

63,923

 

 

 

63,778

 

 

 

42,452

 

Bank-owned life insurance

 

 

40,339

 

 

 

40,168

 

 

 

44,534

 

 

 

44,364

 

 

 

37,025

 

Deferred tax asset, net

 

 

8,137

 

 

 

8,810

 

 

 

8,849

 

 

 

8,959

 

 

 

14,130

 

Other assets

 

 

40,954

 

 

 

35,650

 

 

 

32,720

 

 

 

32,109

 

 

 

29,069

 

Total assets

 

$

4,537,102

 

 

$

3,794,631

 

 

$

3,405,010

 

 

$

3,499,033

 

 

$

2,906,161

 

LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest bearing deposits

 

$

697,903

 

 

$

561,033

 

 

$

548,991

 

 

$

564,225

 

 

$

403,643

 

Interest bearing deposits

 

 

2,741,146

 

 

 

2,063,909

 

 

 

1,984,507

 

 

 

2,057,123

 

 

 

1,608,902

 

Total deposits

 

 

3,439,049

 

 

 

2,624,942

 

 

 

2,533,498

 

 

 

2,621,348

 

 

 

2,012,545

 

Customer repurchase agreements

 

 

13,248

 

 

 

10,509

 

 

 

6,751

 

 

 

11,488

 

 

 

19,869

 

Federal Home Loan Bank advances

 

 

330,000

 

 

 

420,000

 

 

 

355,000

 

 

 

365,000

 

 

 

385,000

 

Subordinated notes

 

 

48,903

 

 

 

48,878

 

 

 

48,853

 

 

 

48,828

 

 

 

48,804

 

Junior subordinated debentures

 

 

38,966

 

 

 

38,849

 

 

 

38,734

 

 

 

38,623

 

 

 

33,047

 

Other liabilities

 

 

50,295

 

 

 

44,228

 

 

 

19,230

 

 

 

22,048

 

 

 

20,799

 

Total liabilities

 

 

3,920,461

 

 

 

3,187,406

 

 

 

3,002,066

 

 

 

3,107,335

 

 

 

2,520,064

 

EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock series A

 

 

4,550

 

 

 

4,550

 

 

 

4,550

 

 

 

4,550

 

 

 

4,550

 

Preferred stock series B

 

 

5,108

 

 

 

5,108

 

 

 

5,108

 

 

 

5,108

 

 

 

5,108

 

Common stock

 

 

264

 

 

 

264

 

 

 

209

 

 

 

209

 

 

 

209

 

Additional paid-in-capital

 

 

458,920

 

 

 

457,980

 

 

 

265,406

 

 

 

264,855

 

 

 

264,531

 

Treasury stock, at cost

 

 

(2,285

)

 

 

(2,254

)

 

 

(1,853

)

 

 

(1,784

)

 

 

(1,760

)

Retained earnings

 

 

152,401

 

 

 

143,426

 

 

 

131,234

 

 

 

119,356

 

 

 

113,245

 

Accumulated other comprehensive income

 

 

(2,317

)

 

 

(1,849

)

 

 

(1,710

)

 

 

(596

)

 

 

214

 

Total equity

 

 

616,641

 

 

 

607,225

 

 

 

402,944

 

 

 

391,698

 

 

 

386,097

 

Total liabilities and equity

 

$

4,537,102

 

 

$

3,794,631

 

 

$

3,405,010

 

 

$

3,499,033

 

 

$

2,906,161

 


5

 

Unaudited consolidated statement of income:

 

For the Three Months Ended

 

 

For the Nine Months Ended

 

 

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

(Dollars in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

 

2018

 

 

2017

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, including fees

 

$

41,257

 

 

$

38,148

 

 

$

36,883

 

 

$

34,856

 

 

$

30,863

 

 

$

116,288

 

 

$

86,711

 

Factored receivables, including fees

 

 

27,939

 

 

 

20,791

 

 

 

15,303

 

 

 

15,000

 

 

 

12,198

 

 

 

64,033

 

 

 

32,177

 

Securities

 

 

1,551

 

 

 

1,179

 

 

 

1,310

 

 

 

1,819

 

 

 

1,655

 

 

 

4,040

 

 

 

5,004

 

FHLB stock

 

 

147

 

 

 

101

 

 

 

105

 

 

 

78

 

 

 

51

 

 

 

353

 

 

 

129

 

Cash deposits

 

 

865

 

 

 

1,030

 

 

 

517

 

 

 

464

 

 

 

370

 

 

 

2,412

 

 

 

986

 

Total interest income

 

 

71,759

 

 

 

61,249

 

 

 

54,118

 

 

 

52,217

 

 

 

45,137

 

 

 

187,126

 

 

 

125,007

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

6,219

 

 

 

4,631

 

 

 

4,277

 

 

 

3,884

 

 

 

3,272

 

 

 

15,127

 

 

 

9,198

 

Subordinated notes

 

 

837

 

 

 

838

 

 

 

837

 

 

 

836

 

 

 

837

 

 

 

2,512

 

 

 

2,508

 

Junior subordinated debentures

 

 

714

 

 

 

713

 

 

 

597

 

 

 

520

 

 

 

495

 

 

 

2,024

 

 

 

1,435

 

Other borrowings

 

 

2,207

 

 

 

1,810

 

 

 

1,277

 

 

 

1,181

 

 

 

1,021

 

 

 

5,294

 

 

 

1,978

 

Total interest expense

 

 

9,977

 

 

 

7,992

 

 

 

6,988

 

 

 

6,421

 

 

 

5,625

 

 

 

24,957

 

 

 

15,119

 

Net interest income

 

 

61,782

 

 

 

53,257

 

 

 

47,130

 

 

 

45,796

 

 

 

39,512

 

 

 

162,169

 

 

 

109,888

 

Provision for loan losses

 

 

6,803

 

 

 

4,906

 

 

 

2,548

 

 

 

1,931

 

 

 

572

 

 

 

14,257

 

 

 

9,697

 

Net interest income after provision for loan losses

 

 

54,979

 

 

 

48,351

 

 

 

44,582

 

 

 

43,865

 

 

 

38,940

 

 

 

147,912

 

 

 

100,191

 

Non-interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposits

 

 

1,412

 

 

 

1,210

 

 

 

1,145

 

 

 

1,178

 

 

 

1,046

 

 

 

3,767

 

 

 

3,003

 

Card income

 

 

1,877

 

 

 

1,394

 

 

 

1,244

 

 

 

1,122

 

 

 

956

 

 

 

4,515

 

 

 

2,700

 

Net OREO gains (losses) and valuation adjustments

 

 

65

 

 

 

(528

)

 

 

(88

)

 

 

(764

)

 

 

15

 

 

 

(551

)

 

 

(86

)

Net gains (losses) on sale of securities

 

 

—

 

 

 

—

 

 

 

(272

)

 

 

—

 

 

 

35

 

 

 

(272

)

 

 

35

 

Fee income

 

 

1,593

 

 

 

1,121

 

 

 

800

 

 

 

658

 

 

 

625

 

 

 

3,514

 

 

 

1,845

 

Insurance commissions

 

 

1,113

 

 

 

819

 

 

 

714

 

 

 

857

 

 

 

826

 

 

 

2,646

 

 

 

2,125

 

Asset management fees

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,717

 

Gain on sale of subsidiary

 

 

—

 

 

 

—

 

 

 

1,071

 

 

 

—

 

 

 

—

 

 

 

1,071

 

 

 

20,860

 

Other

 

 

(1

)

 

 

929

 

 

 

558

 

 

 

947

 

 

 

668

 

 

 

1,486

 

 

 

4,459

 

Total non-interest income

 

 

6,059

 

 

 

4,945

 

 

 

5,172

 

 

 

3,998

 

 

 

4,171

 

 

 

16,176

 

 

 

36,658

 

Non-interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

24,695

 

 

 

20,527

 

 

 

19,404

 

 

 

18,009

 

 

 

16,717

 

 

 

64,626

 

 

 

54,687

 

Occupancy, furniture and equipment

 

 

3,553

 

 

 

3,014

 

 

 

3,054

 

 

 

2,728

 

 

 

2,398

 

 

 

9,621

 

 

 

7,105

 

FDIC insurance and other regulatory assessments

 

 

363

 

 

 

383

 

 

 

199

 

 

 

411

 

 

 

294

 

 

 

945

 

 

 

790

 

Professional fees

 

 

3,384

 

 

 

2,078

 

 

 

1,640

 

 

 

2,521

 

 

 

1,465

 

 

 

7,102

 

 

 

4,671

 

Amortization of intangible assets

 

 

2,064

 

 

 

1,361

 

 

 

1,117

 

 

 

2,309

 

 

 

870

 

 

 

4,542

 

 

 

2,892

 

Advertising and promotion

 

 

1,609

 

 

 

1,300

 

 

 

1,029

 

 

 

573

 

 

 

804

 

 

 

3,938

 

 

 

2,653

 

Communications and technology

 

 

7,252

 

 

 

3,271

 

 

 

3,359

 

 

 

2,291

 

 

 

2,145

 

 

 

13,882

 

 

 

6,552

 

Other

 

 

6,026

 

 

 

5,469

 

 

 

4,240

 

 

 

4,389

 

 

 

3,532

 

 

 

15,735

 

 

 

11,033

 

Total non-interest expense

 

 

48,946

 

 

 

37,403

 

 

 

34,042

 

 

 

33,231

 

 

 

28,225

 

 

 

120,391

 

 

 

90,383

 

Net income before income tax

 

 

12,092

 

 

 

15,893

 

 

 

15,712

 

 

 

14,632

 

 

 

14,886

 

 

 

43,697

 

 

 

46,466

 

Income tax expense

 

 

2,922

 

 

 

3,508

 

 

 

3,644

 

 

 

8,327

 

 

 

5,104

 

 

 

10,074

 

 

 

16,551

 

Net income

 

$

9,170

 

 

$

12,385

 

 

$

12,068

 

 

$

6,305

 

 

$

9,782

 

 

$

33,623

 

 

$

29,915

 

Dividends on preferred stock

 

 

(195

)

 

 

(193

)

 

 

(190

)

 

 

(194

)

 

 

(195

)

 

 

(578

)

 

 

(580

)

Net income available to common stockholders

 

$

8,975

 

 

$

12,192

 

 

$

11,878

 

 

$

6,111

 

 

$

9,587

 

 

$

33,045

 

 

$

29,335

 

 


6

 

Earnings per share:

 

For the Three Months Ended

 

 

For the Nine Months Ended

 

 

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

(Dollars in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

 

2018

 

 

2017

 

Basic

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income to common stockholders

 

$

8,975

 

 

$

12,192

 

 

$

11,878

 

 

$

6,111

 

 

$

9,587

 

 

$

33,045

 

 

$

29,335

 

Weighted average common shares outstanding

 

 

26,178,194

 

 

 

25,519,108

 

 

 

20,721,363

 

 

 

20,717,548

 

 

 

19,811,577

 

 

 

24,159,543

 

 

 

18,600,009

 

Basic earnings per common share

 

$

0.34

 

 

$

0.48

 

 

$

0.57

 

 

$

0.29

 

 

$

0.48

 

 

$

1.37

 

 

$

1.58

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income to common stockholders

 

$

8,975

 

 

$

12,192

 

 

$

11,878

 

 

$

6,111

 

 

$

9,587

 

 

$

33,045

 

 

$

29,335

 

Dilutive effect of preferred stock

 

 

195

 

 

 

193

 

 

 

190

 

 

 

194

 

 

 

195

 

 

 

578

 

 

 

580

 

Net income to common stockholders - diluted

 

$

9,170

 

 

$

12,385

 

 

$

12,068

 

 

$

6,305

 

 

$

9,782

 

 

$

33,623

 

 

$

29,915

 

Weighted average common shares outstanding

 

 

26,178,194

 

 

 

25,519,108

 

 

 

20,721,363

 

 

 

20,717,548

 

 

 

19,811,577

 

 

 

24,159,543

 

 

 

18,600,009

 

Dilutive effects of:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assumed conversion of Preferred A

 

 

315,773

 

 

 

315,773

 

 

 

315,773

 

 

 

315,773

 

 

 

315,773

 

 

 

315,773

 

 

 

315,773

 

Assumed conversion of Preferred B

 

 

354,471

 

 

 

354,471

 

 

 

354,471

 

 

 

354,471

 

 

 

354,471

 

 

 

354,471

 

 

 

354,471

 

Assumed exercises of stock warrants

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

54,476

 

 

 

—

 

 

 

110,089

 

Assumed exercises of stock options

 

 

90,320

 

 

 

86,821

 

 

 

83,872

 

 

 

56,359

 

 

 

45,788

 

 

 

86,728

 

 

 

42,084

 

Restricted stock awards

 

 

45,796

 

 

 

37,417

 

 

 

85,045

 

 

 

74,318

 

 

 

63,384

 

 

 

55,087

 

 

 

65,999

 

Restricted stock units

 

 

7,276

 

 

 

2,288

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

2,706

 

 

 

—

 

Performance stock units

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Weighted average shares outstanding - diluted

 

 

26,991,830

 

 

 

26,315,878

 

 

 

21,560,524

 

 

 

21,518,469

 

 

 

20,645,469

 

 

 

24,974,308

 

 

 

19,488,425

 

Diluted earnings per common share

 

$

0.34

 

 

$

0.47

 

 

$

0.56

 

 

$

0.29

 

 

$

0.47

 

 

$

1.35

 

 

$

1.53

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares that were not considered in computing diluted earnings per common share because they were antidilutive are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended

 

 

For the Nine Months Ended

 

 

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

 

2018

 

 

2017

 

Assumed conversion of Preferred A

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Assumed conversion of Preferred B

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Stock options

 

 

51,952

 

 

 

51,952

 

 

 

—

 

 

 

57,926

 

 

 

58,442

 

 

 

51,952

 

 

 

58,442

 

Restricted stock awards

 

 

14,513

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

14,513

 

 

 

—

 

Restricted stock units

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Performance stock units

 

 

59,658

 

 

 

59,658

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

59,658

 

 

 

—

 

 

 


7

 

Loans held for investment summarized as of:

  

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

(Dollars in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

Commercial real estate

 

$

906,494

 

 

$

766,839

 

 

$

781,006

 

 

$

745,893

 

 

$

574,530

 

Construction, land development, land

 

 

190,920

 

 

 

147,852

 

 

 

143,876

 

 

 

134,812

 

 

 

141,368

 

1-4 family residential properties

 

 

194,752

 

 

 

122,653

 

 

 

122,979

 

 

 

125,827

 

 

 

96,032

 

Farmland

 

 

177,313

 

 

 

177,060

 

 

 

184,064

 

 

 

180,141

 

 

 

130,471

 

Commercial

 

 

1,123,598

 

 

 

1,006,443

 

 

 

930,283

 

 

 

920,812

 

 

 

890,372

 

Factored receivables

 

 

611,285

 

 

 

603,812

 

 

 

397,145

 

 

 

374,410

 

 

 

341,880

 

Consumer

 

 

31,423

 

 

 

28,775

 

 

 

29,244

 

 

 

31,131

 

 

 

30,093

 

Mortgage warehouse

 

 

276,358

 

 

 

343,028

 

 

 

285,388

 

 

 

297,830

 

 

 

220,717

 

     Total loans

 

$

3,512,143

 

 

$

3,196,462

 

 

$

2,873,985

 

 

$

2,810,856

 

 

$

2,425,463

 

A portion of our total loans held for investment portfolio consists of traditional community bank loans as well as commercial finance products offered under our commercial finance brands on a nationwide basis. Commercial finance loans are further summarized below:

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

(Dollars in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

Equipment

 

$

323,832

 

 

$

290,314

 

 

$

260,502

 

 

$

254,119

 

 

$

226,120

 

Asset based lending (General)

 

 

273,096

 

 

 

261,412

 

 

 

230,314

 

 

 

213,471

 

 

 

193,884

 

Asset based lending (Healthcare)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

67,889

 

Premium finance

 

 

75,293

 

 

 

51,416

 

 

 

48,561

 

 

 

55,520

 

 

 

57,083

 

Factored receivables

 

 

611,285

 

 

 

603,812

 

 

 

397,145

 

 

 

374,410

 

 

 

341,880

 

     Commercial finance

 

$

1,283,506

 

 

$

1,206,954

 

 

$

936,522

 

 

$

897,520

 

 

$

886,856

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial finance % of total loans

 

 

37

%

 

 

38

%

 

 

33

%

 

 

32

%

 

 

37

%

Additional information pertaining to our loan portfolio, summarized as of and for the quarters ended:

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

(Dollars in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

Average community banking

 

$

2,039,624

 

 

$

1,897,678

 

 

$

1,816,921

 

 

$

1,637,195

 

 

$

1,463,401

 

Average commercial finance(1)

 

 

1,254,095

 

 

 

1,024,369

 

 

 

949,938

 

 

 

921,579

 

 

 

831,955

 

Average total loans

 

$

3,293,719

 

 

$

2,922,047

 

 

$

2,766,859

 

 

$

2,558,774

 

 

$

2,295,356

 

Community banking yield

 

 

5.68

%

 

 

5.80

%

 

 

5.81

%

 

 

5.87

%

 

 

5.60

%

Commercial finance yield(1)

 

 

12.66

%

 

 

12.08

%

 

 

11.17

%

 

 

11.03

%

 

 

10.62

%

Total loan yield

 

 

8.33

%

 

 

8.09

%

 

 

7.65

%

 

 

7.73

%

 

 

7.44

%

(1) Includes assets held for sale for the periods ended March 31, 2018 and December 31, 2017

8

 

Information pertaining to our factoring segment, which includes only factoring originated by our Triumph Business Capital subsidiary, summarized as of and for the quarters ended:

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

Factored receivable period end balance

 

$

579,985,000

 

 

$

577,548,000

 

 

$

372,771,000

 

 

$

346,293,000

 

 

$

315,742,000

 

Yield on average receivable balance

 

 

18.96

%

 

 

18.70

%

 

 

17.40

%

 

 

16.91

%

 

 

16.64

%

Rolling twelve quarter annual charge-off rate

 

 

0.38

%

 

 

0.41

%

 

 

0.50

%

 

 

0.41

%

 

 

0.44

%

Factored receivables - transportation concentration

 

 

83

%

 

 

84

%

 

 

86

%

 

 

84

%

 

 

84

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income, including fees

 

$

27,420,000

 

 

$

20,314,000

 

 

$

14,780,000

 

 

$

14,518,000

 

 

$

11,736,000

 

Non-interest income

 

 

942,000

 

 

 

920,000

 

 

 

590,000

 

 

 

535,000

 

 

 

774,000

 

Factored receivable total revenue

 

 

28,362,000

 

 

 

21,234,000

 

 

 

15,370,000

 

 

 

15,053,000

 

 

 

12,510,000

 

Average net funds employed

 

 

525,499,000

 

 

 

398,096,000

 

 

 

316,488,000

 

 

 

309,614,000

 

 

 

260,384,000

 

Yield on average net funds employed

 

 

21.41

%

 

 

21.39

%

 

 

19.70

%

 

 

19.29

%

 

 

19.06

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable purchased

 

$

1,503,049,000

 

 

$

1,162,810,000

 

 

$

912,336,000

 

 

$

872,373,000

 

 

$

732,406,000

 

Number of invoices purchased

 

 

836,771

 

 

 

656,429

 

 

 

521,906

 

 

 

511,879

 

 

 

476,370

 

Average invoice size

 

$

1,796

 

 

$

1,771

 

 

$

1,751

 

 

$

1,705

 

 

$

1,537

 

Average invoice size - transportation

 

$

1,666

 

 

$

1,695

 

 

$

1,662

 

 

$

1,647

 

 

$

1,486

 

Average invoice size - non-transportation

 

$

3,267

 

 

$

2,522

 

 

$

2,627

 

 

$

2,251

 

 

$

1,965

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net new clients

 

 

422

 

 

 

2,072

 

 

 

280

 

 

 

233

 

 

 

235

 

Period end clients

 

 

5,932

 

 

 

5,510

 

 

 

3,438

 

 

 

3,158

 

 

 

2,925

 

Deposits summarized as of:

  

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

(Dollars in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

 

Non-interest bearing demand

 

$

697,903

 

 

$

561,033

 

 

$

548,991

 

 

$

564,225

 

 

$

403,643

 

 

Interest bearing demand

 

 

608,775

 

 

 

358,246

 

 

 

392,947

 

 

 

403,244

 

 

 

284,282

 

 

Individual retirement accounts

 

 

118,459

 

 

 

101,380

 

 

 

105,558

 

 

 

108,505

 

 

 

97,186

 

 

Money market

 

 

413,402

 

 

 

268,699

 

 

 

283,354

 

 

 

283,969

 

 

 

189,177

 

 

Savings

 

 

373,062

 

 

 

239,127

 

 

 

244,103

 

 

 

235,296

 

 

 

158,464

 

 

Certificates of deposit

 

 

854,048

 

 

 

751,290

 

 

 

783,651

 

 

 

837,384

 

 

 

770,599

 

 

Brokered deposits

 

 

373,400

 

 

 

345,167

 

 

 

174,894

 

 

 

188,725

 

 

 

109,194

 

 

     Total deposits

 

$

3,439,049

 

 

$

2,624,942

 

 

$

2,533,498

 

 

$

2,621,348

 

 

$

2,012,545

 

 

9

 

Net interest margin summarized for the three months ended:

 

September 30, 2018

 

 

June 30, 2018

 

 

 

Average

 

 

 

 

 

 

Average

 

 

Average

 

 

 

 

 

 

Average

 

(Dollars in thousands)

 

Balance

 

 

Interest

 

 

Rate

 

 

Balance

 

 

Interest

 

 

Rate

 

Interest earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest earning cash balances

 

$

156,876

 

 

$

865

 

 

 

2.19

%

 

$

217,605

 

 

$

1,030

 

 

 

1.90

%

Taxable securities

 

 

183,238

 

 

 

1,207

 

 

 

2.61

%

 

 

168,182

 

 

 

1,024

 

 

 

2.44

%

Tax-exempt securities

 

 

66,208

 

 

 

344

 

 

 

2.06

%

 

 

35,016

 

 

 

155

 

 

 

1.78

%

FHLB stock

 

 

20,984

 

 

 

147

 

 

 

2.78

%

 

 

18,297

 

 

 

101

 

 

 

2.21

%

Loans

 

 

3,293,719

 

 

 

69,196

 

 

 

8.33

%

 

 

2,922,047

 

 

 

58,939

 

 

 

8.09

%

     Total interest earning assets

 

$

3,721,025

 

 

$

71,759

 

 

 

7.65

%

 

$

3,361,147

 

 

$

61,249

 

 

 

7.31

%

Non-interest earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other assets

 

 

339,535

 

 

 

 

 

 

 

 

 

 

 

267,813

 

 

 

 

 

 

 

 

 

          Total assets

 

$

4,060,560

 

 

 

 

 

 

 

 

 

 

$

3,628,960

 

 

 

 

 

 

 

 

 

Interest bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest bearing demand

 

$

418,226

 

 

$

200

 

 

 

0.19

%

 

$

381,114

 

 

$

215

 

 

 

0.23

%

Individual retirement accounts

 

 

105,774

 

 

 

339

 

 

 

1.27

%

 

 

103,358

 

 

 

315

 

 

 

1.22

%

Money market

 

 

303,843

 

 

 

594

 

 

 

0.78

%

 

 

256,841

 

 

 

335

 

 

 

0.52

%

Savings

 

 

272,230

 

 

 

60

 

 

 

0.09

%

 

 

241,029

 

 

 

30

 

 

 

0.05

%

Certificates of deposit

 

 

793,685

 

 

 

3,068

 

 

 

1.53

%

 

 

767,484

 

 

 

2,593

 

 

 

1.36

%

      Brokered deposits

 

 

384,337

 

 

 

1,958

 

 

 

2.02

%

 

 

246,089

 

 

 

1,143

 

 

 

1.86

%

     Total deposits

 

 

2,278,095

 

 

 

6,219

 

 

 

1.08

%

 

 

1,995,915

 

 

 

4,631

 

 

 

0.93

%

Subordinated notes

 

 

48,890

 

 

 

837

 

 

 

6.79

%

 

 

48,864

 

 

 

838

 

 

 

6.88

%

Junior subordinated debentures

 

 

38,905

 

 

 

714

 

 

 

7.28

%

 

 

38,787

 

 

 

713

 

 

 

7.37

%

Other borrowings

 

 

425,781

 

 

 

2,207

 

 

 

2.06

%

 

 

385,646

 

 

 

1,810

 

 

 

1.88

%

     Total interest bearing liabilities

 

$

2,791,671

 

 

$

9,977

 

 

 

1.42

%

 

$

2,469,212

 

 

$

7,992

 

 

 

1.30

%

Non-interest bearing liabilities and equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest bearing demand deposits

 

 

608,245

 

 

 

 

 

 

 

 

 

 

 

553,309

 

 

 

 

 

 

 

 

 

Other liabilities

 

 

41,961

 

 

 

 

 

 

 

 

 

 

 

23,823

 

 

 

 

 

 

 

 

 

Total equity

 

 

618,683

 

 

 

 

 

 

 

 

 

 

 

582,616

 

 

 

 

 

 

 

 

 

Total liabilities and equity

 

$

4,060,560

 

 

 

 

 

 

 

 

 

 

$

3,628,960

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

 

 

$

61,782

 

 

 

 

 

 

 

 

 

 

$

53,257

 

 

 

 

 

Interest spread

 

 

 

 

 

 

 

 

 

 

6.23

%

 

 

 

 

 

 

 

 

 

 

6.01

%

Net interest margin

 

 

 

 

 

 

 

 

 

 

6.59

%

 

 

 

 

 

 

 

 

 

 

6.36

%

 

 


10

 

Metrics and non-GAAP financial reconciliation:

 

As of and for the Three Months Ended

 

 

As of and for the Nine Months Ended

 

(Dollars in thousands,

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

except per share amounts)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

 

2018

 

 

2017

 

Net income available to common stockholders

 

$

8,975

 

 

$

12,192

 

 

$

11,878

 

 

$

6,111

 

 

$

9,587

 

 

$

33,045

 

 

$

29,335

 

Gain on sale of subsidiary

 

 

—

 

 

 

—

 

 

 

(1,071

)

 

 

—

 

 

 

—

 

 

 

(1,071

)

 

 

(20,860

)

Incremental bonus related to transaction

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4,814

 

Transaction related costs

 

 

5,871

 

 

 

1,094

 

 

 

—

 

 

 

1,688

 

 

 

—

 

 

 

6,965

 

 

 

325

 

Tax effect of adjustments

 

 

(1,392

)

 

 

(257

)

 

 

248

 

 

 

(601

)

 

 

—

 

 

 

(1,401

)

 

 

5,754

 

Adjusted net income available to common stockholders

 

$

13,454

 

 

$

13,029

 

 

$

11,055

 

 

$

7,198

 

 

$

9,587

 

 

$

37,538

 

 

$

19,368

 

Dilutive effect of convertible preferred stock

 

 

195

 

 

 

193

 

 

 

190

 

 

 

194

 

 

 

195

 

 

 

578

 

 

 

580

 

Adjusted net income available to common stockholders - diluted

 

$

13,649

 

 

$

13,222

 

 

$

11,245

 

 

$

7,392

 

 

$

9,782

 

 

$

38,116

 

 

$

19,948

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - diluted

 

 

26,991,830

 

 

 

26,315,878

 

 

 

21,560,524

 

 

 

21,518,469

 

 

 

20,645,469

 

 

 

24,974,308

 

 

 

19,488,425

 

Adjusted effects of assumed Preferred Stock conversion

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Adjusted weighted average shares outstanding - diluted

 

 

26,991,830

 

 

 

26,315,878

 

 

 

21,560,524

 

 

 

21,518,469

 

 

 

20,645,469

 

 

 

24,974,308

 

 

 

19,488,425

 

Adjusted diluted earnings per common share

 

$

0.51

 

 

$

0.50

 

 

$

0.52

 

 

$

0.34

 

 

$

0.47

 

 

$

1.53

 

 

$

1.02

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income available to common stockholders

 

$

8,975

 

 

$

12,192

 

 

$

11,878

 

 

$

6,111

 

 

$

9,587

 

 

$

33,045

 

 

$

29,335

 

Average tangible common equity

 

 

470,553

 

 

 

491,492

 

 

 

326,614

 

 

 

330,819

 

 

 

309,624

 

 

 

430,080

 

 

 

267,633

 

Return on average tangible common equity

 

 

7.57

%

 

 

9.95

%

 

 

14.75

%

 

 

7.33

%

 

 

12.28

%

 

 

10.27

%

 

 

14.65

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted efficiency ratio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

61,782

 

 

$

53,257

 

 

$

47,130

 

 

$

45,796

 

 

$

39,512

 

 

$

162,169

 

 

$

109,888

 

Non-interest income

 

 

6,059

 

 

 

4,945

 

 

 

5,172

 

 

 

3,998

 

 

 

4,171

 

 

 

16,176

 

 

 

36,658

 

Operating revenue

 

 

67,841

 

 

 

58,202

 

 

 

52,302

 

 

 

49,794

 

 

 

43,683

 

 

 

178,345

 

 

 

146,546

 

Gain on sale of subsidiary

 

 

—

 

 

 

—

 

 

 

(1,071

)

 

 

—

 

 

 

—

 

 

 

(1,071

)

 

 

(20,860

)

Adjusted operating revenue

 

$

67,841

 

 

$

58,202

 

 

$

51,231

 

 

$

49,794

 

 

$

43,683

 

 

$

177,274

 

 

$

125,686

 

Non-interest expenses

 

$

48,946

 

 

$

37,403

 

 

$

34,042

 

 

$

33,231

 

 

$

28,225

 

 

$

120,391

 

 

$

90,383

 

Incremental bonus related to transaction

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(4,814

)

Transaction related costs

 

 

(5,871

)

 

 

(1,094

)

 

 

—

 

 

 

(1,688

)

 

 

—

 

 

 

(6,965

)

 

 

(325

)

Adjusted non-interest expenses

 

$

43,075

 

 

$

36,309

 

 

$

34,042

 

 

$

31,543

 

 

$

28,225

 

 

$

113,426

 

 

$

85,244

 

Adjusted efficiency ratio

 

 

63.49

%

 

 

62.38

%

 

 

66.45

%

 

 

63.35

%

 

 

64.61

%

 

 

63.98

%

 

 

67.82

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net non-interest expense to average assets ratio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest expenses

 

$

48,946

 

 

$

37,403

 

 

$

34,042

 

 

$

33,231

 

 

$

28,225

 

 

$

120,391

 

 

$

90,383

 

Incremental bonus related to transaction

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(4,814

)

Transaction related costs

 

 

(5,871

)

 

 

(1,094

)

 

 

—

 

 

 

(1,688

)

 

 

—

 

 

 

(6,965

)

 

 

(325

)

Adjusted non-interest expenses

 

$

43,075

 

 

$

36,309

 

 

$

34,042

 

 

$

31,543

 

 

$

28,225

 

 

$

113,426

 

 

$

85,244

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total non-interest income

 

$

6,059

 

 

$

4,945

 

 

$

5,172

 

 

$

3,998

 

 

$

4,171

 

 

$

16,176

 

 

$

36,658

 

Gain on sale of subsidiary

 

 

—

 

 

 

—

 

 

 

(1,071

)

 

 

—

 

 

 

—

 

 

 

(1,071

)

 

 

(20,860

)

Adjusted non-interest income

 

$

6,059

 

 

$

4,945

 

 

$

4,101

 

 

$

3,998

 

 

$

4,171

 

 

$

15,105

 

 

$

15,798

 

Adjusted net non-interest expenses

 

$

37,016

 

 

$

31,364

 

 

$

29,941

 

 

$

27,545

 

 

$

24,054

 

 

$

98,321

 

 

$

69,446

 

Average total assets

 

$

4,060,560

 

 

$

3,628,960

 

 

$

3,410,883

 

 

$

3,181,697

 

 

$

2,849,170

 

 

$

3,702,513

 

 

$

2,731,426

 

Adjusted net non-interest expense to average assets ratio

 

 

3.62

%

 

 

3.47

%

 

 

3.56

%

 

 

3.43

%

 

 

3.35

%

 

 

3.55

%

 

 

3.40

%

 

11

 

 

As of and for the Three Months Ended

 

 

As of and for the Nine Months Ended

 

(Dollars in thousands,

 

September 30,

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

except per share amounts)

 

2018

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

 

2018

 

 

2017

 

Reported yield on loans

 

 

8.33

%

 

 

8.09

%

 

 

7.65

%

 

 

7.73

%

 

 

7.44

%

 

 

8.05

%

 

 

7.47

%

Effect of accretion income on acquired loans

 

 

(0.15

%)

 

 

(0.50

%)

 

 

(0.29

%)

 

 

(0.26

%)

 

 

(0.24

%)

 

 

(0.31

%)

 

 

(0.33

%)

Adjusted yield on loans

 

 

8.18

%

 

 

7.59

%

 

 

7.36

%

 

 

7.47

%

 

 

7.20

%

 

 

7.74

%

 

 

7.14

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported net interest margin

 

 

6.59

%

 

 

6.36

%

 

 

6.06

%

 

 

6.16

%

 

 

5.90

%

 

 

6.35

%

 

 

5.82

%

Effect of accretion income on acquired loans

 

 

(0.14

%)

 

 

(0.44

%)

 

 

(0.25

%)

 

 

(0.23

%)

 

 

(0.21

%)

 

 

(0.27

%)

 

 

(0.28

%)

Adjusted net interest margin

 

 

6.45

%

 

 

5.92

%

 

 

5.81

%

 

 

5.93

%

 

 

5.69

%

 

 

6.08

%

 

 

5.54

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders' equity

 

$

616,641

 

 

$

607,225

 

 

$

402,944

 

 

$

391,698

 

 

$

386,097

 

 

$

616,641

 

 

$

386,097

 

Preferred stock liquidation preference

 

 

(9,658

)

 

 

(9,658

)

 

 

(9,658

)

 

 

(9,658

)

 

 

(9,658

)

 

 

(9,658

)

 

 

(9,658

)

Total common stockholders' equity

 

 

606,983

 

 

 

597,567

 

 

 

393,286

 

 

 

382,040

 

 

 

376,439

 

 

 

606,983

 

 

 

376,439

 

Goodwill and other intangibles

 

 

(201,842

)

 

 

(117,777

)

 

 

(63,923

)

 

 

(63,778

)

 

 

(42,452

)

 

 

(201,842

)

 

 

(42,452

)

Tangible common stockholders' equity

 

$

405,141

 

 

$

479,790

 

 

$

329,363

 

 

$

318,262

 

 

$

333,987

 

 

$

405,141

 

 

$

333,987

 

Common shares outstanding

 

 

26,279,761

 

 

 

26,260,785

 

 

 

20,824,509

 

 

 

20,820,445

 

 

 

20,820,900

 

 

 

26,279,761

 

 

 

20,820,900

 

Tangible book value per share

 

$

15.42

 

 

$

18.27

 

 

$

15.82

 

 

$

15.29

 

 

$

16.04

 

 

$

15.42

 

 

$

16.04

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets at end of period

 

$

4,537,102

 

 

$

3,794,631

 

 

$

3,405,010

 

 

$

3,499,033

 

 

$

2,906,161

 

 

$

4,537,102

 

 

$

2,906,161

 

Goodwill and other intangibles

 

 

(201,842

)

 

 

(117,777

)

 

 

(63,923

)

 

 

(63,778

)

 

 

(42,452

)

 

 

(201,842

)

 

 

(42,452

)

Adjusted total assets at period end

 

$

4,335,260

 

 

$

3,676,854

 

 

$

3,341,087

 

 

$

3,435,255

 

 

$

2,863,709

 

 

$

4,335,260

 

 

$

2,863,709

 

Tangible common stockholders' equity ratio

 

 

9.35

%

 

 

13.05

%

 

 

9.86

%

 

 

9.26

%

 

 

11.66

%

 

 

9.35

%

 

 

11.66

%

1)

Triumph uses certain non-GAAP financial measures to provide meaningful supplemental information regarding Triumph's operational performance and to enhance investors' overall understanding of such financial performance.  The non-GAAP measures used by Triumph include the following:

 

 

•

“Adjusted diluted earnings per common share” is defined as adjusted net income available to common stockholders divided by adjusted weighted average diluted common shares outstanding.  Excluded from net income available to common stockholders are material gains and expenses related to merger and acquisition-related activities, including divestitures, net of tax. In our judgment, the adjustments made to net income available to common stockholders allow management and investors to better assess our performance in relation to our core net income by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.  Weighted average diluted common shares outstanding are adjusted as a result of changes in their dilutive properties given the gain and expense adjustments described herein.  

 

 

•

"Tangible common stockholders' equity" is common stockholders' equity less goodwill and other intangible assets.

 

 

•

"Total tangible assets" is defined as total assets less goodwill and other intangible assets.

 

 

•

"Tangible book value per share" is defined as tangible common stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.

 

 

•

"Tangible common stockholders' equity ratio" is defined as the ratio of tangible common stockholders' equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets.

 

 

•

"Return on Average Tangible Common Equity" is defined as net income available to common stockholders divided by average tangible common stockholders' equity.

 

 

•

"Adjusted efficiency ratio" is defined as non-interest expenses divided by our operating revenue, which is equal to net interest income plus non-interest income. Also excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. In our judgment, the adjustments made to operating revenue and non-interest expense allow management and investors to better assess our performance in relation to our core operating revenue by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.

 

 

•

"Adjusted net non-interest expense to average total assets" is defined as non-interest expenses net of non-interest income divided by total average assets. Excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures.  This metric is used by our management to better assess our operating efficiency.  

 

12

 

 

•

"Adjusted yield on loans" is our yield on loans after excluding loan discount accretion from our acquired loan portfolio.  Our management uses this metric to better assess the impact of purchase accounting on our yield on loans, as the effect of loan discount accretion is expected to decrease as the acquired loans pay down or mature and are removed from our balance sheet.

 

 

•

“Adjusted net interest margin” is net interest margin after excluding loan accretion from the acquired loan portfolio.  Our management uses this metric to better assess the impact of purchase accounting on net interest margin, as the effect of loan discount accretion is expected to decrease as the acquired loans pay down or mature and are removed from our balance sheet.  

 

2)

Asset quality ratios exclude loans held for sale, except for non-performing assets to total assets.

 

3)

Current quarter ratios are preliminary.

 


Source: Triumph Bancorp, Inc.

 

###

 

Investor Relations:

Luke Wyse

Senior Vice President, Finance & Investor Relations

lwyse@tbkbank.com

214-365-6936

 

Media Contact:

Amanda Tavackoli

Senior Vice President, Marketing & Communication

atavackoli@tbkbank.com

214-365-6930

13