Date of Report (Date of earliest event reported) | October 31, 2016 |
Commission File Number: | 001-15393 |
Delaware | 42-1405748 | |
(State or other jurisdiction of incorporation) | (I.R.S. Employer Identification Number) |
1398 Central Avenue Dubuque, Iowa 52001 |
(Address of principal executive offices) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
(a) | Financial Statements of Business Acquired. |
(b) | Pro Forma Financial Information. |
(c) | Exhibits. |
Date: October 31, 2016 | HEARTLAND FINANCIAL USA, INC. | ||
By: | /s/ Bryan R. McKeag | ||
Executive Vice President | |||
Chief Financial Officer |
CONTACT: | FOR IMMEDIATE RELEASE |
Bryan R. McKeag | October 31, 2016 |
Executive Vice President | |
Chief Financial Officer | |
(563) 589-1994 | |
bmckeag@htlf.com |
§ | Quarterly net income available to common stockholders of $20.2 million, a 40% increase from third quarter of prior year | |
§ | Diluted earnings per common share of $0.81, a 17% increase from third quarter of prior year | |
§ | Net interest margin of 3.97%, fully taxable equivalent (non-GAAP)(1) of 4.14% | |
§ | Return on average common equity of 11.64% | |
§ | Return on average tangible common equity (non-GAAP)(2) of 14.93% | |
§ | Total demand deposits increase $88.8 million or 4% since June 30, 2016 |
Quarter Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net income (in millions) | $ | 20.2 | $ | 14.6 | $ | 61.2 | $ | 45.5 | |||||||
Net income available to common stockholders (in millions) | 20.2 | 14.4 | 61.0 | 44.8 | |||||||||||
Diluted earnings per common share | 0.81 | 0.69 | 2.48 | 2.16 | |||||||||||
Return on average assets | 0.98 | % | 0.85 | % | 1.00 | % | 0.91 | % | |||||||
Return on average common equity | 11.64 | 11.40 | 12.28 | 12.38 | |||||||||||
Return on average tangible common equity (non-GAAP)(2) | 14.93 | 13.22 | 15.87 | 14.31 | |||||||||||
Net interest margin | 3.97 | 3.85 | 3.98 | 3.80 | |||||||||||
Net interest margin, fully taxable equivalent (non-GAAP)(1) | 4.14 | 4.01 | 4.15 | 3.96 |
"Heartland reported another excellent quarter with net income available to common stockholders of $20.2 million, a 40 percent increase over the previous year’s quarter. Among several areas of strength, we attribute our results to a very solid net interest margin of 4.14 percent for the quarter." |
Lynn B. Fuller, chairman and chief executive officer, Heartland Financial USA, Inc. |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA | |||||||||||||||
For the Quarter Ended September 30, | For the Nine Months Ended September 30, 2016 | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Interest Income | |||||||||||||||
Interest and fees on loans | $ | 70,046 | $ | 58,328 | $ | 208,280 | $ | 167,201 | |||||||
Interest on securities: | |||||||||||||||
Taxable | 7,917 | 5,858 | 24,604 | 19,729 | |||||||||||
Nontaxable | 3,717 | 3,077 | 10,793 | 8,867 | |||||||||||
Interest on federal funds sold | 1 | 1 | 12 | 3 | |||||||||||
Interest on deposits in other financial institutions | 6 | 4 | 13 | 11 | |||||||||||
Total Interest Income | 81,687 | 67,268 | 243,702 | 195,811 | |||||||||||
Interest Expense | |||||||||||||||
Interest on deposits | 4,001 | 3,767 | 12,195 | 11,758 | |||||||||||
Interest on short-term borrowings | 235 | 228 | 1,083 | 638 | |||||||||||
Interest on other borrowings | 3,770 | 3,549 | 10,918 | 12,117 | |||||||||||
Total Interest Expense | 8,006 | 7,544 | 24,196 | 24,513 | |||||||||||
Net Interest Income | 73,681 | 59,724 | 219,506 | 171,298 | |||||||||||
Provision for loan losses | 5,328 | 3,181 | 9,513 | 10,526 | |||||||||||
Net Interest Income After Provision for Loan Losses | 68,353 | 56,543 | 209,993 | 160,772 | |||||||||||
Noninterest Income | |||||||||||||||
Service charges and fees | 8,278 | 6,350 | 23,462 | 17,654 | |||||||||||
Loan servicing income | 873 | 1,368 | 3,433 | 3,572 | |||||||||||
Trust fees | 3,689 | 3,507 | 11,127 | 11,051 | |||||||||||
Brokerage and insurance commissions | 1,006 | 869 | 2,914 | 2,872 | |||||||||||
Securities gains, net | 1,584 | 1,767 | 9,732 | 9,230 | |||||||||||
Gains on sale of loans held for sale | 11,459 | 9,823 | 33,794 | 38,164 | |||||||||||
Valuation adjustment on commercial servicing rights | 5 | — | (41 | ) | — | ||||||||||
Income on bank owned life insurance | 620 | 372 | 1,733 | 1,355 | |||||||||||
Other noninterest income | 1,028 | 924 | 2,992 | 2,406 | |||||||||||
Total Noninterest Income | 28,542 | 24,980 | 89,146 | 86,304 | |||||||||||
Noninterest Expense | |||||||||||||||
Salaries and employee benefits | 40,733 | 37,033 | 124,432 | 110,522 | |||||||||||
Occupancy | 5,099 | 4,307 | 15,322 | 12,594 | |||||||||||
Furniture and equipment | 2,746 | 2,121 | 7,301 | 6,403 | |||||||||||
Professional fees | 5,985 | 5,251 | 20,481 | 16,544 | |||||||||||
FDIC insurance assessments | 1,180 | 1,018 | 3,468 | 2,873 | |||||||||||
Advertising | 1,339 | 1,327 | 4,174 | 3,841 | |||||||||||
Intangible assets amortization | 1,291 | 734 | 4,483 | 2,080 | |||||||||||
Other real estate and loan collection expenses | 640 | 496 | 1,871 | 1,714 | |||||||||||
(Gain)/loss on sales/valuations of assets, net | 794 | 721 | 1,064 | 2,583 | |||||||||||
Other noninterest expenses | 8,620 | 8,988 | 27,160 | 25,938 | |||||||||||
Total Noninterest Expense | 68,427 | 61,996 | 209,756 | 185,092 | |||||||||||
Income Before Income Taxes | 28,468 | 19,527 | 89,383 | 61,984 | |||||||||||
Income taxes | 8,260 | 4,945 | 28,196 | 16,533 | |||||||||||
Net Income | 20,208 | 14,582 | 61,187 | 45,451 | |||||||||||
Preferred dividends | (53 | ) | (205 | ) | (273 | ) | (613 | ) | |||||||
Interest expense on convertible preferred debt | 17 | — | 48 | — | |||||||||||
Net Income Available to Common Stockholders | $ | 20,172 | $ | 14,377 | $ | 60,962 | $ | 44,838 | |||||||
Earnings per common share-diluted | $ | 0.81 | $ | 0.69 | $ | 2.48 | $ | 2.16 | |||||||
Weighted average shares outstanding-diluted | 24,922,946 | 20,893,312 | 24,580,897 | 20,751,664 |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA | |||||||||||||||||||
For the Quarter Ended | |||||||||||||||||||
9/30/2016 | 6/30/2016 | 3/31/2016 | 12/31/2015 | 9/30/2015 | |||||||||||||||
Interest Income | |||||||||||||||||||
Interest and fees on loans | $ | 70,046 | $ | 69,809 | $ | 68,425 | $ | 59,905 | $ | 58,328 | |||||||||
Interest on securities: | |||||||||||||||||||
Taxable | 7,917 | 7,952 | 8,735 | 6,917 | 5,858 | ||||||||||||||
Nontaxable | 3,717 | 3,566 | 3,510 | 3,311 | 3,077 | ||||||||||||||
Interest on federal funds sold | 1 | 1 | 10 | 21 | 1 | ||||||||||||||
Interest on deposits in other financial institutions | 6 | 3 | 4 | 3 | 4 | ||||||||||||||
Total Interest Income | 81,687 | 81,331 | 80,684 | 70,157 | 67,268 | ||||||||||||||
Interest Expense | |||||||||||||||||||
Interest on deposits | 4,001 | 4,021 | 4,173 | 3,772 | 3,767 | ||||||||||||||
Interest on short-term borrowings | 235 | 519 | 329 | 200 | 228 | ||||||||||||||
Interest on other borrowings | 3,770 | 3,673 | 3,475 | 3,485 | 3,549 | ||||||||||||||
Total Interest Expense | 8,006 | 8,213 | 7,977 | 7,457 | 7,544 | ||||||||||||||
Net Interest Income | 73,681 | 73,118 | 72,707 | 62,700 | 59,724 | ||||||||||||||
Provision for loan losses | 5,328 | 2,118 | 2,067 | 2,171 | 3,181 | ||||||||||||||
Net Interest Income After Provision for Loan Losses | 68,353 | 71,000 | 70,640 | 60,529 | 56,543 | ||||||||||||||
Noninterest Income | |||||||||||||||||||
Service charges and fees | 8,278 | 8,022 | 7,162 | 6,654 | 6,350 | ||||||||||||||
Loan servicing income | 873 | 1,292 | 1,268 | 1,704 | 1,368 | ||||||||||||||
Trust fees | 3,689 | 3,625 | 3,813 | 3,230 | 3,507 | ||||||||||||||
Brokerage and insurance commissions | 1,006 | 886 | 1,022 | 917 | 869 | ||||||||||||||
Securities gains, net | 1,584 | 4,622 | 3,526 | 3,913 | 1,767 | ||||||||||||||
Impairment loss on securities | — | — | — | (769 | ) | — | |||||||||||||
Gains on sale of loans held for sale | 11,459 | 11,270 | 11,065 | 7,085 | 9,823 | ||||||||||||||
Valuation adjustment on commercial servicing rights | 5 | (46 | ) | — | — | — | |||||||||||||
Income on bank owned life insurance | 620 | 591 | 522 | 644 | 372 | ||||||||||||||
Other noninterest income | 1,028 | 764 | 1,200 | 1,003 | 924 | ||||||||||||||
Total Noninterest Income | 28,542 | 31,026 | 29,578 | 24,381 | 24,980 | ||||||||||||||
Noninterest Expense | |||||||||||||||||||
Salaries and employee benefits | 40,733 | 41,985 | 41,714 | 33,583 | 37,033 | ||||||||||||||
Occupancy | 5,099 | 5,220 | 5,003 | 4,334 | 4,307 | ||||||||||||||
Furniture and equipment | 2,746 | 2,442 | 2,113 | 2,344 | 2,121 | ||||||||||||||
Professional fees | 5,985 | 7,486 | 7,010 | 6,503 | 5,251 | ||||||||||||||
FDIC insurance assessments | 1,180 | 1,120 | 1,168 | 886 | 1,018 | ||||||||||||||
Advertising | 1,339 | 1,551 | 1,284 | 1,624 | 1,327 | ||||||||||||||
Intangible assets amortization | 1,291 | 1,297 | 1,895 | 898 | 734 | ||||||||||||||
Other real estate and loan collection expenses | 640 | 659 | 572 | 723 | 496 | ||||||||||||||
(Gain)/loss on sales/valuations of assets, net | 794 | (43 | ) | 313 | 4,238 | 721 | |||||||||||||
Other noninterest expenses | 8,620 | 9,303 | 9,237 | 10,821 | 8,988 | ||||||||||||||
Total Noninterest Expense | 68,427 | 71,020 | 70,309 | 65,954 | 61,996 | ||||||||||||||
Income Before Income Taxes | 28,468 | 31,006 | 29,909 | 18,956 | 19,527 | ||||||||||||||
Income taxes | 8,260 | 10,036 | 9,900 | 4,365 | 4,945 | ||||||||||||||
Net Income | 20,208 | 20,970 | 20,009 | 14,591 | 14,582 | ||||||||||||||
Preferred dividends | (53 | ) | (52 | ) | (168 | ) | (204 | ) | (205 | ) | |||||||||
Interest expense on convertible preferred debt | 17 | 31 | — | — | — | ||||||||||||||
Net Income Available to Common Stockholders | $ | 20,172 | $ | 20,949 | $ | 19,841 | $ | 14,387 | $ | 14,377 | |||||||||
Earnings per common share-diluted | $ | 0.81 | $ | 0.84 | $ | 0.82 | $ | 0.67 | $ | 0.69 | |||||||||
Weighted average shares outstanding-diluted | 24,922,946 | 24,974,995 | 24,117,384 | 21,491,699 | 20,893,312 |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA | |||||||||||||||||||
As Of | |||||||||||||||||||
9/30/2016 | 6/30/2016 | 3/31/2016 | 12/31/2015 | 9/30/2015 | |||||||||||||||
Assets | |||||||||||||||||||
Cash and due from banks | $ | 196,234 | $ | 222,718 | $ | 124,060 | $ | 237,841 | $ | 76,954 | |||||||||
Federal funds sold and other short-term investments | 5,855 | 7,232 | 9,168 | 20,958 | 14,151 | ||||||||||||||
Cash and cash equivalents | 202,089 | 229,950 | 133,228 | 258,799 | 91,105 | ||||||||||||||
Time deposits in other financial institutions | 2,105 | 2,105 | 2,355 | 2,355 | 2,355 | ||||||||||||||
Securities: | |||||||||||||||||||
Available for sale, at fair value | 1,655,696 | 1,566,592 | 1,690,516 | 1,578,434 | 1,261,687 | ||||||||||||||
Held to maturity, at cost | 265,302 | 270,423 | 271,300 | 279,117 | 282,200 | ||||||||||||||
Other investments, at cost | 22,082 | 22,680 | 22,325 | 21,443 | 19,292 | ||||||||||||||
Loans held for sale | 78,317 | 82,538 | 76,565 | 74,783 | 102,569 | ||||||||||||||
Loans: | |||||||||||||||||||
Held to maturity | 5,438,715 | 5,482,258 | 5,503,005 | 5,001,486 | 4,642,523 | ||||||||||||||
Allowance for loan losses | (54,653 | ) | (51,756 | ) | (49,738 | ) | (48,685 | ) | (47,105 | ) | |||||||||
Loans, net | 5,384,062 | 5,430,502 | 5,453,267 | 4,952,801 | 4,595,418 | ||||||||||||||
Premises, furniture and equipment, net | 165,841 | 168,701 | 164,788 | 150,148 | 147,486 | ||||||||||||||
Goodwill | 127,699 | 127,699 | 127,699 | 97,852 | 56,828 | ||||||||||||||
Core deposit intangibles, net | 23,922 | 25,213 | 26,510 | 22,019 | 14,937 | ||||||||||||||
Servicing rights, net | 35,906 | 35,654 | 34,910 | 34,926 | 33,758 | ||||||||||||||
Cash surrender value on life insurance | 112,060 | 111,425 | 110,834 | 110,297 | 99,564 | ||||||||||||||
Other real estate, net | 10,740 | 11,003 | 11,338 | 11,524 | 17,041 | ||||||||||||||
Other assets | 116,394 | 119,916 | 128,144 | 100,256 | 81,644 | ||||||||||||||
Total Assets | $ | 8,202,215 | $ | 8,204,401 | $ | 8,253,779 | $ | 7,694,754 | $ | 6,805,884 | |||||||||
Liabilities and Equity | |||||||||||||||||||
Liabilities | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Demand | $ | 2,238,736 | $ | 2,149,911 | $ | 2,079,521 | $ | 1,914,141 | $ | 1,632,005 | |||||||||
Savings | 3,753,300 | 3,691,791 | 3,702,431 | 3,367,479 | 2,936,611 | ||||||||||||||
Time | 920,657 | 995,870 | 1,142,368 | 1,124,203 | 938,621 | ||||||||||||||
Total deposits | 6,912,693 | 6,837,572 | 6,924,320 | 6,405,823 | 5,507,237 | ||||||||||||||
Short-term borrowings | 214,105 | 303,707 | 325,741 | 293,898 | 335,845 | ||||||||||||||
Other borrowings | 294,493 | 296,895 | 265,760 | 263,214 | 302,086 | ||||||||||||||
Accrued expenses and other liabilities | 76,536 | 78,264 | 68,415 | 68,646 | 69,707 | ||||||||||||||
Total Liabilities | 7,497,827 | 7,516,438 | 7,584,236 | 7,031,581 | 6,214,875 | ||||||||||||||
Stockholders' Equity | |||||||||||||||||||
Preferred equity | 1,357 | 3,777 | 3,777 | 81,698 | 81,698 | ||||||||||||||
Common stock | 24,683 | 24,544 | 24,520 | 22,436 | 20,640 | ||||||||||||||
Capital surplus | 279,316 | 274,682 | 273,310 | 216,436 | 149,613 | ||||||||||||||
Retained earnings | 402,179 | 384,479 | 366,014 | 348,630 | 337,421 | ||||||||||||||
Accumulated other comprehensive income (loss) | (3,079 | ) | 513 | 1,924 | (6,027 | ) | 1,731 | ||||||||||||
Treasury stock at cost | (68 | ) | (32 | ) | (2 | ) | — | (94 | ) | ||||||||||
Total Equity | 704,388 | 687,963 | 669,543 | 663,173 | 591,009 | ||||||||||||||
Total Liabilities and Equity | $ | 8,202,215 | $ | 8,204,401 | $ | 8,253,779 | $ | 7,694,754 | $ | 6,805,884 |
HEARTLAND FINANCIAL USA, INC. | ||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | ||||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA | ||||||||||||||||
For the Quarter Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Average Balances | ||||||||||||||||
Assets | $ | 8,172,683 | $ | 6,726,196 | $ | 8,136,492 | $ | 6,603,085 | ||||||||
Loans, net of unearned | 5,538,088 | 4,654,179 | 5,493,187 | 4,457,715 | ||||||||||||
Deposits | 6,839,334 | 5,423,418 | 6,775,103 | 5,296,771 | ||||||||||||
Earning assets | 7,382,860 | 6,161,495 | 7,368,856 | 6,030,612 | ||||||||||||
Interest bearing liabilities | 5,224,172 | 4,491,089 | 5,286,708 | 4,447,165 | ||||||||||||
Common stockholders' equity | 689,637 | 500,399 | 663,050 | 484,418 | ||||||||||||
Total stockholders' equity | 692,404 | 582,097 | 687,312 | 566,116 | ||||||||||||
Tangible common stockholders' equity(1) | 537,375 | 431,304 | 513,031 | 419,059 | ||||||||||||
Key Performance Ratios | ||||||||||||||||
Annualized return on average assets | 0.98 | % | 0.85 | % | 1.00 | % | 0.91 | % | ||||||||
Annualized return on average common equity | 11.64 | % | 11.40 | % | 12.28 | % | 12.38 | % | ||||||||
Annualized return on average common tangible equity(2) | 14.93 | % | 13.22 | % | 15.87 | % | 14.31 | % | ||||||||
Annualized ratio of net charge-offs to average loans | 0.17 | % | 0.14 | % | 0.09 | % | 0.15 | % | ||||||||
Annualized net interest margin, fully taxable equivalent(3) | 4.14 | % | 4.01 | % | 4.15 | % | 3.96 | % | ||||||||
Efficiency ratio, fully taxable equivalent(4) | 63.88 | % | 69.85 | % | 66.23 | % | 69.37 | % | ||||||||
Reconciliation of Return on Average Common Tangible Equity (non-GAAP)(5) | ||||||||||||||||
Net income available to common shareholders (GAAP) | $ | 20,172 | $ | 14,377 | $ | 60,962 | $ | 44,838 | ||||||||
Average common stockholders' equity (GAAP) | $ | 689,637 | $ | 500,399 | $ | 663,050 | $ | 484,418 | ||||||||
Less average goodwill | 127,699 | 55,073 | 125,061 | 52,251 | ||||||||||||
Less average other intangibles, net | 24,563 | 14,022 | 24,958 | 13,108 | ||||||||||||
Average common tangible equity (non-GAAP) | $ | 537,375 | $ | 431,304 | $ | 513,031 | $ | 419,059 | ||||||||
Annualized return on average common equity (GAAP) | 11.64 | % | 11.40 | % | 12.28 | % | 12.38 | % | ||||||||
Annualized return on average common tangible equity (non-GAAP) | 14.93 | % | 13.22 | % | 15.87 | % | 14.31 | % | ||||||||
Reconciliation of Annualized Net Interest Margin, Fully Taxable Equivalent (non-GAAP)(6) | ||||||||||||||||
Net Interest Income (GAAP) | $ | 73,681 | $ | 59,724 | $ | 219,506 | $ | 171,298 | ||||||||
Plus taxable equivalent adjustment(7) | 3,221 | 2,588 | 9,408 | 7,389 | ||||||||||||
Net interest income - taxable equivalent (non-GAAP) | $ | 76,902 | $ | 62,312 | $ | 228,914 | $ | 178,687 | ||||||||
Average earning assets | $ | 7,382,860 | $ | 6,161,495 | $ | 7,368,856 | $ | 6,030,612 | ||||||||
Annualized net interest margin (GAAP) | 3.97 | % | 3.85 | % | 3.98 | % | 3.80 | % | ||||||||
Annualized net interest margin, fully taxable equivalent (non-GAAP) | 4.14 | % | 4.01 | % | 4.15 | % | 3.96 | % | ||||||||
(1) Calculated as common stockholders' equity less goodwill and core deposit intangibles, net. | ||||||||||||||||
(2) Refer to the "Reconciliation of Return on Average Common Tangible Equity (non-GAAP)" table. | ||||||||||||||||
(3) Refer to the "Reconciliation of Annualized Net Interest Margin, Fully Taxable Equivalent (non-GAAP)" table. | ||||||||||||||||
(4) Refer to the "Reconciliation of Non-GAAP Measure-Efficiency Ratio" table that follows for details of this non-GAAP measure. | ||||||||||||||||
(5) Return on average common tangible equity is net income available to common stockholders divided by average common stockholders' equity less goodwill and core deposit intangibles, net. This financial measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength. This measure should not be considered a substitute for operating results determined in accordance with GAAP. | ||||||||||||||||
(6) Annualized net interest margin, fully taxable equivalent is a non-GAAP measure, which adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources. This measure should not be considered a substitute for operating results determined in accordance with GAAP. | ||||||||||||||||
(7) Computed on a taxable equivalent basis using an effective tax rate of 35%. |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA | |||||||||||||||||||
For the Quarter Ended | |||||||||||||||||||
9/30/2016 | 6/30/2016 | 3/31/2016 | 12/31/2015 | 9/30/2015 | |||||||||||||||
Average Balances | |||||||||||||||||||
Assets | $ | 8,172,683 | $ | 8,211,326 | $ | 8,025,070 | $ | 7,241,104 | $ | 6,726,196 | |||||||||
Loans, net of unearned | 5,538,088 | 5,582,878 | 5,358,102 | 4,827,844 | 4,654,179 | ||||||||||||||
Deposits | 6,839,334 | 6,806,259 | 6,679,010 | 5,938,905 | 5,423,418 | ||||||||||||||
Earning assets | 7,382,860 | 7,446,849 | 7,276,703 | 6,512,565 | 6,161,495 | ||||||||||||||
Interest bearing liabilities | 5,224,172 | 5,363,477 | 5,273,164 | 4,781,797 | 4,491,089 | ||||||||||||||
Common stockholders' equity | 689,637 | 669,930 | 629,294 | 533,845 | 500,399 | ||||||||||||||
Total stockholders' equity | 692,404 | 673,707 | 695,771 | 615,543 | 582,097 | ||||||||||||||
Tangible common stockholders' equity(1) | 537,375 | 516,347 | 485,108 | 446,370 | 431,304 | ||||||||||||||
Key Performance Ratios | |||||||||||||||||||
Annualized return on average assets | 0.98 | % | 1.03 | % | 0.99 | % | 0.79 | % | 0.85 | % | |||||||||
Annualized return on average common equity | 11.64 | % | 12.58 | % | 12.68 | % | 10.69 | % | 11.40 | % | |||||||||
Annualized return on average common tangible equity(2) | 14.93 | % | 16.32 | % | 16.45 | % | 12.79 | % | 13.22 | % | |||||||||
Annualized ratio of net charge-offs to average loans | 0.17 | % | 0.01 | % | 0.08 | % | 0.05 | % | 0.14 | % | |||||||||
Annualized net interest margin, fully taxable equivalent(3) | 4.14 | % | 4.12 | % | 4.19 | % | 3.99 | % | 4.01 | % | |||||||||
Efficiency ratio, fully taxable equivalent(4) | 63.88 | % | 67.95 | % | 66.90 | % | 68.53 | % | 69.85 | % | |||||||||
Reconciliation of Return on Average Common Tangible Equity (non-GAAP)(5) | |||||||||||||||||||
Net income available to common shareholders (GAAP) | $ | 20,172 | $ | 20,949 | $ | 19,841 | $ | 14,387 | $ | 14,377 | |||||||||
Average common stockholders' equity (GAAP) | $ | 689,637 | $ | 669,930 | $ | 629,294 | $ | 533,845 | $ | 500,399 | |||||||||
Less average goodwill | 127,699 | 127,699 | 119,750 | 70,222 | 55,073 | ||||||||||||||
Less average other intangibles, net | 24,563 | 25,884 | 24,436 | 17,253 | 14,022 | ||||||||||||||
Average common tangible equity (non-GAAP) | $ | 537,375 | $ | 516,347 | $ | 485,108 | $ | 446,370 | $ | 431,304 | |||||||||
Annualized return on average common equity (GAAP) | 11.64 | % | 12.58 | % | 12.68 | % | 10.69 | % | 11.40 | % | |||||||||
Annualized return on average common tangible equity (non-GAAP) | 14.93 | % | 16.32 | % | 16.45 | % | 12.79 | % | 13.22 | % | |||||||||
Reconciliation of Annualized Net Interest Margin, Fully Taxable Equivalent (non-GAAP)(6) | |||||||||||||||||||
Net Interest Income (GAAP) | $ | 73,681 | $ | 73,118 | $ | 72,707 | $ | 62,700 | $ | 59,724 | |||||||||
Plus taxable equivalent adjustment(7) | 3,221 | 3,146 | 3,041 | 2,827 | 2,588 | ||||||||||||||
Net interest income, fully taxable equivalent (non-GAAP) | $ | 76,902 | $ | 76,264 | $ | 75,748 | $ | 65,527 | $ | 62,312 | |||||||||
Average earning assets | $ | 7,382,860 | $ | 7,446,849 | $ | 7,276,703 | $ | 6,512,565 | $ | 6,161,495 | |||||||||
Annualized net interest margin (GAAP) | 3.97 | % | 3.95 | % | 4.02 | % | 3.82 | % | 3.85 | % | |||||||||
Annualized net interest margin, fully taxable equivalent (non-GAAP) | 4.14 | % | 4.12 | % | 4.19 | % | 3.99 | % | 4.01 | % | |||||||||
(1) Calculated as common stockholders' equity less goodwill and core deposit intangibles, net. | |||||||||||||||||||
(2) Refer to the "Reconciliation of Return on Average Common Tangible Equity (non-GAAP)" table. | |||||||||||||||||||
(3) Refer to the "Reconciliation of Annualized Net Interest Margin, Fully Taxable Equivalent (non-GAAP)" table. | |||||||||||||||||||
(4) Refer to the "Reconciliation of Non-GAAP Measure-Efficiency Ratio" table that follows for details of this non-GAAP measure. | |||||||||||||||||||
(5) Return on average common tangible equity is net income available to common stockholders divided by average common stockholders' equity less goodwill and core deposit intangibles, net. This financial measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength. This measure should not be considered a substitute for operating results determined in accordance with GAAP. | |||||||||||||||||||
(6) Annualized net interest margin, fully taxable equivalent is a non-GAAP measure, which adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources. This measure should not be considered a substitute for operating results determined in accordance with GAAP. | |||||||||||||||||||
(7) Computed on a taxable equivalent basis using an effective tax rate of 35%. |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA | |||||||||||||||||||
For the Quarter Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||
Reconciliation of Non-GAAP Measure-Efficiency Ratio(1) | 2016 | 2015 | 2016 | 2015 | |||||||||||||||
Net interest income | $ | 73,681 | $ | 59,724 | $ | 219,506 | $ | 171,298 | |||||||||||
Taxable equivalent adjustment(2) | 3,221 | 2,588 | 9,408 | 7,389 | |||||||||||||||
Fully taxable equivalent net interest income | 76,902 | 62,312 | 228,914 | 178,687 | |||||||||||||||
Noninterest income | 28,542 | 24,980 | 89,146 | 86,304 | |||||||||||||||
Securities gains, net | (1,584 | ) | (1,767 | ) | (9,732 | ) | (9,230 | ) | |||||||||||
Adjusted income | $ | 103,860 | $ | 85,525 | $ | 308,328 | $ | 255,761 | |||||||||||
Total noninterest expenses | $ | 68,427 | $ | 61,996 | $ | 209,756 | $ | 185,092 | |||||||||||
Less: | |||||||||||||||||||
Intangible assets amortization | 1,291 | 734 | 4,483 | 2,080 | |||||||||||||||
Partnership investment in historic rehabilitation tax credits | — | 805 | — | 2,995 | |||||||||||||||
(Gain)/loss on sales/valuations of assets, net | 794 | 721 | 1,064 | 2,583 | |||||||||||||||
Adjusted noninterest expenses | $ | 66,342 | $ | 59,736 | $ | 204,209 | $ | 177,434 | |||||||||||
Efficiency ratio, fully taxable equivalent | 63.88 | % | 69.85 | % | 66.23 | % | 69.37 | % | |||||||||||
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA | |||||||||||||||||||
Reconciliation of Non-GAAP Measure-Efficiency Ratio(1) | For the Quarter Ended | ||||||||||||||||||
9/30/2016 | 6/30/2016 | 3/31/2016 | 12/31/2015 | 9/30/2015 | |||||||||||||||
Net interest income | $ | 73,681 | $ | 73,118 | $ | 72,707 | $ | 62,700 | $ | 59,724 | |||||||||
Taxable equivalent adjustment(2) | 3,221 | 3,146 | 3,041 | 2,827 | 2,588 | ||||||||||||||
Fully taxable equivalent net interest income | 76,902 | 76,264 | 75,748 | 65,527 | 62,312 | ||||||||||||||
Noninterest income | 28,542 | 31,026 | 29,578 | 24,381 | 24,980 | ||||||||||||||
Securities gains, net | (1,584 | ) | (4,622 | ) | (3,526 | ) | (3,913 | ) | (1,767 | ) | |||||||||
Impairment loss on securities | — | — | — | 769 | — | ||||||||||||||
Adjusted income | $ | 103,860 | $ | 102,668 | $ | 101,800 | $ | 86,764 | $ | 85,525 | |||||||||
Total noninterest expenses | $ | 68,427 | $ | 71,020 | $ | 70,309 | $ | 65,954 | $ | 61,996 | |||||||||
Less: | |||||||||||||||||||
Intangible assets amortization | 1,291 | 1,297 | 1,895 | 898 | 734 | ||||||||||||||
Partnership investment in historic rehabilitation tax credits | — | — | — | 1,362 | 805 | ||||||||||||||
(Gain)/loss on sales/valuation of assets, net | 794 | (43 | ) | 313 | 4,238 | 721 | |||||||||||||
Adjusted noninterest expenses | $ | 66,342 | $ | 69,766 | $ | 68,101 | $ | 59,456 | $ | 59,736 | |||||||||
Efficiency ratio, fully taxable equivalent | 63.88 | % | 67.95 | % | 66.90 | % | 68.53 | % | 69.85 | % | |||||||||
(1) Efficiency ratio, fully taxable equivalent, expresses noninterest expenses as a percentage of fully taxable equivalent net interest income and noninterest income. This efficiency ratio is presented on a taxable equivalent basis, which adjusts net interest income and noninterest expenses for the tax favored status of certain loans, securities and historic rehabilitation tax credits. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results as it enhances the comparability of income and expenses arising from taxable and nontaxable sources and excludes specific items, as noted in the table. This measure should not be considered a substitute for operating results determined in accordance with GAAP. | |||||||||||||||||||
(2) Computed on a tax equivalent basis using an effective tax rate of 35%. |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE AND FULL TIME EQUIVALENT EMPLOYEE DATA | |||||||||||||||||||
As of and for the Quarter Ended | |||||||||||||||||||
9/30/2016 | 6/30/2016 | 3/31/2016 | 12/31/2015 | 9/30/2015 | |||||||||||||||
Common Share Data | |||||||||||||||||||
Book value per common share | $ | 28.48 | $ | 27.88 | $ | 27.15 | $ | 25.92 | $ | 24.68 | |||||||||
Tangible book value per common share (non-GAAP)(5) | $ | 22.34 | $ | 21.65 | $ | 20.86 | $ | 20.57 | $ | 21.20 | |||||||||
ASC 320 effect on book value per common share | $ | 0.03 | $ | 0.21 | $ | 0.23 | $ | (0.18 | ) | $ | 0.22 | ||||||||
Common shares outstanding, net of treasury stock | 24,681,380 | 24,543,376 | 24,519,928 | 22,435,693 | 20,637,321 | ||||||||||||||
Tangible capital ratio (non-GAAP)(6) | 6.85 | % | 6.60 | % | 6.32 | % | 6.09 | % | 6.50 | % | |||||||||
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(3) | |||||||||||||||||||
Common stockholders' equity (GAAP) | $ | 703,031 | $ | 684,186 | $ | 665,766 | $ | 581,475 | $ | 509,311 | |||||||||
Less goodwill | 127,699 | 127,699 | 127,699 | 97,852 | 56,828 | ||||||||||||||
Less other intangible assets, net | 23,922 | 25,213 | 26,510 | 22,019 | 14,937 | ||||||||||||||
Tangible common stockholders' equity (non-GAAP) | $ | 551,410 | $ | 531,274 | $ | 511,557 | $ | 461,604 | $ | 437,546 | |||||||||
Common shares outstanding, net of treasury stock | 24,681,380 | 24,543,376 | 24,519,928 | 22,435,693 | 20,637,321 | ||||||||||||||
Common stockholders' equity (book value) per share (GAAP) | $ | 28.48 | $ | 27.88 | $ | 27.15 | $ | 25.92 | $ | 24.68 | |||||||||
Tangible book value per common share (non-GAAP) | $ | 22.34 | $ | 21.65 | $ | 20.86 | $ | 20.57 | $ | 21.20 | |||||||||
Reconciliation of Tangible Capital Ratio (non-GAAP)(4) | |||||||||||||||||||
Total assets (GAAP) | $ | 8,202,215 | $ | 8,204,401 | $ | 8,253,779 | $ | 7,694,754 | $ | 6,805,884 | |||||||||
Less goodwill | 127,699 | 127,699 | 127,699 | 97,852 | 56,828 | ||||||||||||||
Less other intangible assets, net | 23,922 | 25,213 | 26,510 | 22,019 | 14,937 | ||||||||||||||
Total tangible assets (non-GAAP) | $ | 8,050,594 | $ | 8,051,489 | $ | 8,099,570 | $ | 7,574,883 | $ | 6,734,119 | |||||||||
Tangible capital ratio (non-GAAP) | 6.85 | % | 6.60 | % | 6.32 | % | 6.09 | % | 6.50 | % | |||||||||
Loan Data | |||||||||||||||||||
Loans held to maturity: | |||||||||||||||||||
Commercial and commercial real estate | $ | 3,900,612 | $ | 3,930,879 | $ | 3,951,839 | $ | 3,605,574 | $ | 3,303,098 | |||||||||
Residential mortgage | 625,965 | 644,267 | 666,184 | 539,555 | 491,667 | ||||||||||||||
Agricultural and agricultural real estate | 489,387 | 480,883 | 471,271 | 471,870 | 469,381 | ||||||||||||||
Consumer | 425,582 | 428,730 | 417,114 | 386,867 | 379,903 | ||||||||||||||
Unearned discount and deferred loan fees | (2,831 | ) | (2,501 | ) | (3,403 | ) | (2,380 | ) | (1,526 | ) | |||||||||
Total loans held to maturity | $ | 5,438,715 | $ | 5,482,258 | $ | 5,503,005 | $ | 5,001,486 | $ | 4,642,523 | |||||||||
Other Selected Trend Information | |||||||||||||||||||
Effective tax rate | 29.02 | % | 32.37 | % | 33.10 | % | 23.03 | % | 25.32 | % | |||||||||
Full time equivalent employees | 1,846 | 1,888 | 1,907 | 1,799 | 1,736 | ||||||||||||||
Total Residential Mortgage Loan Applications | $ | 445,107 | $ | 440,907 | $ | 406,999 | $ | 307,163 | $ | 443,294 | |||||||||
Residential Mortgage Loans Originated | $ | 324,337 | $ | 324,633 | $ | 238,266 | $ | 258,939 | $ | 370,956 | |||||||||
Residential Mortgage Loans Sold | $ | 315,917 | $ | 302,448 | $ | 220,381 | $ | 260,189 | $ | 360,172 | |||||||||
Residential Mortgage Loan Servicing Portfolio | $ | 4,259,459 | $ | 4,203,429 | $ | 4,112,519 | $ | 4,057,861 | $ | 3,963,677 | |||||||||
(1) Refer to the "Reconciliation of Tangible Book Value Per Common Share (non-GAAP)" table. | |||||||||||||||||||
(2) Refer to the "Reconciliation of Tangible Capital Ratio (non-GAAP)" table. | |||||||||||||||||||
(3) Tangible book value per common share is total common stockholders' equity less goodwill and intangible assets, net divided by common shares outstanding, net of treasury. This is a non-GAAP financial measure but has been included as it is considered to be a critical metric with which to analyze and evaluate financial condition and capital strength. This measure should not be considered a substitute for operating results determined in accordance with GAAP. | |||||||||||||||||||
(4) The tangible capital ratio is total common stockholders' equity less goodwill and intangible assets, net divided by total assets less goodwill and intangible assets, net. This is a non-GAAP financial measure but has been included as it is considered to be a critical metric with which to analyze and evaluate financial condition and capital strength. This measure should not be considered a substitute for operating results determined in accordance with GAAP. |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA | |||||||||||||||||||
As of and for the Quarter Ended | |||||||||||||||||||
9/30/2016 | 6/30/2016 | 3/31/2016 | 12/31/2015 | 9/30/2015 | |||||||||||||||
Allowance for Loan Losses | |||||||||||||||||||
Balance, beginning of period | $ | 51,756 | $ | 49,738 | $ | 48,685 | $ | 47,105 | $ | 45,614 | |||||||||
Provision for loan losses | 5,328 | 2,118 | 2,067 | 2,171 | 3,181 | ||||||||||||||
Charge-offs | (3,283 | ) | (2,951 | ) | (1,605 | ) | (1,837 | ) | (2,439 | ) | |||||||||
Recoveries | 852 | 2,851 | 591 | 1,246 | 749 | ||||||||||||||
Balance, end of period | $ | 54,653 | $ | 51,756 | $ | 49,738 | $ | 48,685 | $ | 47,105 | |||||||||
Asset Quality | |||||||||||||||||||
Nonaccrual loans | $ | 57,799 | $ | 57,053 | $ | 47,750 | $ | 39,655 | $ | 32,577 | |||||||||
Loans past due ninety days or more as to interest or principal payments | 105 | — | 639 | — | 1,181 | ||||||||||||||
Other real estate owned | 10,740 | 11,003 | 11,338 | 11,524 | 17,041 | ||||||||||||||
Other repossessed assets | 821 | 564 | 426 | 485 | 626 | ||||||||||||||
Total nonperforming assets | $ | 69,465 | $ | 68,620 | $ | 60,153 | $ | 51,664 | $ | 51,425 | |||||||||
Performing troubled debt restructured loans | $ | 10,281 | $ | 9,923 | $ | 10,711 | $ | 10,968 | $ | 10,154 | |||||||||
Nonperforming Assets Activity | |||||||||||||||||||
Balance, beginning of period | $ | 68,620 | $ | 60,153 | $ | 51,664 | $ | 51,425 | $ | 44,237 | |||||||||
Net loan charge offs | (2,431 | ) | (100 | ) | (1,014 | ) | (591 | ) | (1,690 | ) | |||||||||
New nonperforming loans | 10,884 | 19,994 | 12,171 | 9,686 | 7,996 | ||||||||||||||
Acquired nonperforming assets | — | — | 3,516 | 4,956 | 5,328 | ||||||||||||||
Reduction of nonperforming loans (1) | (6,983 | ) | (10,313 | ) | (3,563 | ) | (6,768 | ) | (2,758 | ) | |||||||||
OREO/Repossessed assets sales proceeds | (343 | ) | (918 | ) | (2,411 | ) | (2,980 | ) | (1,074 | ) | |||||||||
OREO/Repossessed assets writedowns, net | (521 | ) | (337 | ) | (182 | ) | (3,909 | ) | (756 | ) | |||||||||
Net activity at Citizens Finance Co. | 239 | 141 | (28 | ) | (155 | ) | 142 | ||||||||||||
Balance, end of period | $ | 69,465 | $ | 68,620 | $ | 60,153 | $ | 51,664 | $ | 51,425 | |||||||||
Asset Quality Ratios | |||||||||||||||||||
Ratio of nonperforming loans to total loans | 1.06 | % | 1.04 | % | 0.88 | % | 0.79 | % | 0.73 | % | |||||||||
Ratio of nonperforming assets to total assets | 0.85 | % | 0.84 | % | 0.73 | % | 0.67 | % | 0.76 | % | |||||||||
Annualized ratio of net loan charge-offs to average loans | 0.17 | % | 0.01 | % | 0.08 | % | 0.05 | % | 0.14 | % | |||||||||
Allowance for loan losses as a percent of loans | 1.00 | % | 0.94 | % | 0.90 | % | 0.97 | % | 1.01 | % | |||||||||
Allowance for loan losses as a percent of nonperforming loans | 94.39 | % | 90.72 | % | 102.79 | % | 122.77 | % | 139.54 | % | |||||||||
Loans delinquent 30-89 days as a percent of total loans | 0.40 | % | 0.73 | % | 0.45 | % | 0.31 | % | 0.40 | % | |||||||||
(1) Includes principal reductions, transfers to performing status and transfers to OREO. |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||||
DOLLARS IN THOUSANDS | |||||||||||||||||||||
For the Quarter Ended | |||||||||||||||||||||
September 30, 2016 | September 30, 2015 | ||||||||||||||||||||
Average Balance | Interest | Rate | Average Balance | Interest | Rate | ||||||||||||||||
Earning Assets | |||||||||||||||||||||
Securities: | |||||||||||||||||||||
Taxable | $ | 1,415,446 | $ | 7,917 | 2.23 | % | $ | 1,192,259 | $ | 5,858 | 1.95 | % | |||||||||
Nontaxable(1) | 473,152 | 5,719 | 4.81 | 348,760 | 4,733 | 5.38 | |||||||||||||||
Total securities | 1,888,598 | 13,636 | 2.87 | 1,541,019 | 10,591 | 2.73 | |||||||||||||||
Interest bearing deposits | 7,026 | 6 | 0.34 | 11,567 | 4 | 0.14 | |||||||||||||||
Federal funds sold | 1,409 | 1 | 0.28 | 1,032 | 1 | 0.38 | |||||||||||||||
Loans:(2) | |||||||||||||||||||||
Commercial and commercial real estate(1) | 3,908,623 | 48,334 | 4.92 | 3,252,610 | 38,802 | 4.73 | |||||||||||||||
Residential mortgage | 717,374 | 7,248 | 4.02 | 570,117 | 5,848 | 4.07 | |||||||||||||||
Agricultural and agricultural real estate(1) | 486,008 | 5,719 | 4.68 | 461,144 | 5,525 | 4.75 | |||||||||||||||
Consumer | 426,083 | 8,256 | 7.71 | 370,308 | 7,384 | 7.91 | |||||||||||||||
Fees on loans | — | 1,708 | — | — | 1,701 | — | |||||||||||||||
Less: allowance for loan losses | (52,261 | ) | — | — | (46,302 | ) | — | — | |||||||||||||
Net loans | 5,485,827 | 71,265 | 5.17 | 4,607,877 | 59,260 | 5.10 | |||||||||||||||
Total earning assets | 7,382,860 | 84,908 | 4.58 | % | 6,161,495 | 69,856 | 4.50 | % | |||||||||||||
Nonearning Assets | 789,823 | 564,701 | |||||||||||||||||||
Total Assets | $ | 8,172,683 | $ | 6,726,196 | |||||||||||||||||
Interest Bearing Liabilities | |||||||||||||||||||||
Savings | $ | 3,697,426 | $ | 2,066 | 0.22 | % | $ | 2,870,847 | $ | 1,565 | 0.22 | % | |||||||||
Time, $100,000 and over | 399,498 | 813 | 0.81 | 337,163 | 741 | 0.87 | |||||||||||||||
Other time deposits | 570,445 | 1,122 | 0.78 | 622,110 | 1,461 | 0.93 | |||||||||||||||
Short-term borrowings | 258,783 | 235 | 0.36 | 362,094 | 228 | 0.25 | |||||||||||||||
Other borrowings | 298,020 | 3,770 | 5.03 | 298,875 | 3,549 | 4.71 | |||||||||||||||
Total interest bearing liabilities | 5,224,172 | 8,006 | 0.61 | % | 4,491,089 | 7,544 | 0.67 | % | |||||||||||||
Noninterest Bearing Liabilities | |||||||||||||||||||||
Noninterest bearing deposits | 2,171,965 | 1,593,298 | |||||||||||||||||||
Accrued interest and other liabilities | 84,142 | 59,712 | |||||||||||||||||||
Total noninterest bearing liabilities | 2,256,107 | 1,653,010 | |||||||||||||||||||
Stockholders' Equity | 692,404 | 582,097 | |||||||||||||||||||
Total Liabilities and Stockholders' Equity | $ | 8,172,683 | $ | 6,726,196 | |||||||||||||||||
Net interest income, fully taxable equivalent (non-GAAP)(1) | $ | 76,902 | $ | 62,312 | |||||||||||||||||
Net interest spread(1) | 3.97 | % | 3.83 | % | |||||||||||||||||
Net interest income, fully taxable equivalent (non-GAAP) to total earning assets(3) | 4.14 | % | 4.01 | % | |||||||||||||||||
Interest bearing liabilities to earning assets | 70.76 | % | 72.89 | % | |||||||||||||||||
(1) Computed on a taxable equivalent basis using an effective tax rate of 35% | |||||||||||||||||||||
(2) Nonaccrual loans are included in the average loans outstanding. | |||||||||||||||||||||
(3) Annualized net interest margin, fully taxable equivalent is a non-GAAP measure, which adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax exempt sources. This measure should not be considered a substitute for operating results determined in accordance with GAAP. |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||||
DOLLARS IN THOUSANDS | |||||||||||||||||||||
For the Nine Months Ended | |||||||||||||||||||||
September 30, 2016 | September 30, 2015 | ||||||||||||||||||||
Average Balance | Interest | Rate | Average Balance | Interest | Rate | ||||||||||||||||
Earning Assets | |||||||||||||||||||||
Securities: | |||||||||||||||||||||
Taxable | $ | 1,464,080 | $ | 24,604 | 2.24 | % | $ | 1,266,546 | $ | 19,729 | 2.08 | % | |||||||||
Nontaxable(1) | 440,275 | 16,605 | 5.04 | 335,104 | 13,641 | 5.44 | |||||||||||||||
Total securities | 1,904,355 | 41,209 | 2.89 | 1,601,650 | 33,370 | 2.79 | |||||||||||||||
Interest bearing deposits | 9,785 | 13 | 0.18 | 10,541 | 11 | 0.14 | |||||||||||||||
Federal funds sold | 12,509 | 12 | 0.13 | 4,562 | 3 | 0.09 | |||||||||||||||
Loans:(2) | |||||||||||||||||||||
Commercial and commercial real estate(1) | 3,840,060 | 141,977 | 4.94 | 3,133,525 | 112,343 | 4.79 | |||||||||||||||
Residential mortgage | 751,694 | 23,133 | 4.11 | 529,412 | 16,146 | 4.08 | |||||||||||||||
Agricultural and agricultural real estate(1) | 478,564 | 16,952 | 4.73 | 436,050 | 15,835 | 4.86 | |||||||||||||||
Consumer | 422,869 | 24,452 | 7.72 | 358,728 | 21,476 | 8.00 | |||||||||||||||
Fees on loans | 5,362 | — | 4,016 | — | |||||||||||||||||
Less: allowance for loan losses | (50,980 | ) | — | — | (43,856 | ) | — | — | |||||||||||||
Net loans | 5,442,207 | 211,876 | 5.20 | 4,413,859 | 169,816 | 5.14 | |||||||||||||||
Total earning assets | 7,368,856 | 253,110 | 4.59 | % | 6,030,612 | 203,200 | 4.50 | % | |||||||||||||
Nonearning Assets | 767,636 | 572,473 | |||||||||||||||||||
Total Assets | $ | 8,136,492 | $ | 6,603,085 | |||||||||||||||||
Interest Bearing Liabilities | |||||||||||||||||||||
Savings | $ | 3,651,370 | $ | 5,988 | 0.22 | % | $ | 2,851,506 | $ | 5,002 | 0.23 | % | |||||||||
Time, $100,000 and over | 439,609 | 2,417 | 0.73 | 343,369 | 2,373 | 0.92 | |||||||||||||||
Other time deposits | 599,745 | 3,790 | 0.84 | 570,446 | 4,383 | 1.03 | |||||||||||||||
Short-term borrowings | 314,367 | 1,083 | 0.46 | 343,537 | 638 | 0.25 | |||||||||||||||
Other borrowings | 281,617 | 10,918 | 5.18 | 338,307 | 12,117 | 4.79 | |||||||||||||||
Total interest bearing liabilities | 5,286,708 | 24,196 | 0.61 | % | 4,447,165 | 24,513 | 0.74 | % | |||||||||||||
Noninterest Bearing Liabilities | |||||||||||||||||||||
Noninterest bearing deposits | 2,084,379 | 1,531,450 | |||||||||||||||||||
Accrued interest and other liabilities | 78,093 | 58,354 | |||||||||||||||||||
Total noninterest bearing liabilities | 2,162,472 | 1,589,804 | |||||||||||||||||||
Stockholders' Equity | 687,312 | 566,116 | |||||||||||||||||||
Total Liabilities and Stockholders' Equity | $ | 8,136,492 | $ | 6,603,085 | |||||||||||||||||
Net interest income, fully taxable equivalent (non-GAAP)(1) | $ | 228,914 | $ | 178,687 | |||||||||||||||||
Net interest spread(1) | 3.98 | % | 3.76 | % | |||||||||||||||||
Net interest income, fully taxable equivalent (non-GAAP) to total earning assets(3) | 4.15 | % | 3.96 | % | |||||||||||||||||
Interest bearing liabilities to earning assets | 71.74 | % | 73.74 | % | |||||||||||||||||
(1) Computed on a taxable equivalent basis using an effective tax rate of 35%. | |||||||||||||||||||||
(2) Nonaccrual loans are included in the average loans outstanding. | |||||||||||||||||||||
(3) Annualized net interest margin, fully taxable equivalent is a non-GAAP measure, which adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax exempt sources. This measure should not be considered a substitute for operating results determined in accordance with GAAP. |
HEARTLAND FINANCIAL USA, INC. | |||||||||||||||
SELECTED FINANCIAL DATA - SUBSIDIARY BANKS (Unaudited) | |||||||||||||||
DOLLARS IN THOUSANDS | |||||||||||||||
As of and For the Quarter Ended | |||||||||||||||
9/30/2016 | 6/30/2016 | 3/31/2016 | 12/31/2015 | 9/30/2015 | |||||||||||
Total Assets | |||||||||||||||
Dubuque Bank and Trust Company | $ | 1,448,796 | $ | 1,473,461 | $ | 1,498,771 | $ | 1,617,322 | $ | 1,431,767 | |||||
New Mexico Bank & Trust | 1,318,203 | 1,321,113 | 1,304,886 | 1,336,004 | 1,282,784 | ||||||||||
Wisconsin Bank & Trust | 1,068,288 | 1,080,224 | 1,094,872 | 1,139,337 | 1,098,405 | ||||||||||
Centennial Bank and Trust(1) | 892,723 | 909,697 | 927,040 | 161,806 | 155,114 | ||||||||||
Morrill & Janes Bank and Trust Company | 862,767 | 843,069 | 872,274 | 902,918 | 845,067 | ||||||||||
Illinois Bank & Trust | 748,801 | 742,697 | 718,074 | 757,478 | 769,170 | ||||||||||
Premier Valley Bank | 635,620 | 629,423 | 751,137 | 765,451 | — | ||||||||||
Arizona Bank & Trust | 574,561 | 577,002 | 558,369 | 591,066 | 599,119 | ||||||||||
Rocky Mountain Bank | 481,346 | 473,583 | 479,010 | 491,522 | 501,093 | ||||||||||
Minnesota Bank & Trust | 238,745 | 230,004 | 220,955 | 214,303 | 188,633 | ||||||||||
Total Portfolio Loans | |||||||||||||||
Dubuque Bank and Trust Company | $ | 906,347 | $ | 928,869 | $ | 941,683 | $ | 956,517 | $ | 953,273 | |||||
New Mexico Bank & Trust | 917,679 | 870,109 | 815,739 | 794,744 | 777,433 | ||||||||||
Wisconsin Bank & Trust | 711,714 | 732,503 | 758,789 | 793,508 | 844,557 | ||||||||||
Centennial Bank and Trust(1) | 638,006 | 668,547 | 683,085 | 101,449 | 94,127 | ||||||||||
Morrill & Janes Bank and Trust Company | 538,666 | 522,518 | 536,738 | 539,198 | 527,217 | ||||||||||
Illinois Bank & Trust | 469,236 | 466,983 | 465,783 | 465,937 | 473,859 | ||||||||||
Premier Valley Bank | 354,610 | 376,275 | 376,840 | 383,929 | — | ||||||||||
Arizona Bank & Trust | 385,926 | 390,078 | 402,431 | 444,501 | 444,916 | ||||||||||
Rocky Mountain Bank | 357,346 | 362,475 | 364,189 | 370,440 | 380,304 | ||||||||||
Minnesota Bank & Trust | 139,581 | 144,009 | 137,412 | 134,137 | 128,700 | ||||||||||
Total Deposits | |||||||||||||||
Dubuque Bank and Trust Company | $ | 1,182,947 | $ | 1,159,942 | $ | 1,144,470 | $ | 1,209,074 | $ | 1,120,999 | |||||
New Mexico Bank & Trust | 1,101,550 | 1,062,410 | 1,066,076 | 1,085,052 | 1,047,358 | ||||||||||
Wisconsin Bank & Trust | 889,957 | 911,915 | 921,071 | 974,001 | 904,803 | ||||||||||
Centennial Bank and Trust(1) | 767,128 | 775,417 | 779,607 | 128,759 | 139,826 | ||||||||||
Morrill & Janes Bank and Trust Company | 676,176 | 696,073 | 698,365 | 713,589 | 650,123 | ||||||||||
Illinois Bank & Trust | 671,104 | 653,582 | 629,235 | 631,010 | 641,024 | ||||||||||
Premier Valley Bank | 520,814 | 514,522 | 635,188 | 647,022 | — | ||||||||||
Arizona Bank & Trust | 493,331 | 497,599 | 468,312 | 500,490 | 491,254 | ||||||||||
Rocky Mountain Bank | 420,581 | 405,888 | 409,787 | 417,426 | 428,234 | ||||||||||
Minnesota Bank & Trust | 214,651 | 207,228 | 200,343 | 194,373 | 163,291 | ||||||||||
Net Income (Loss) | |||||||||||||||
Dubuque Bank and Trust Company | $ | 5,112 | $ | 4,475 | $ | 6,073 | $ | 3,587 | $ | 4,477 | |||||
New Mexico Bank & Trust | 3,824 | 5,642 | 4,094 | 2,576 | 3,220 | ||||||||||
Wisconsin Bank & Trust | 3,368 | 3,399 | 3,379 | 2,443 | 3,886 | ||||||||||
Centennial Bank and Trust(1) | 925 | 256 | 824 | 62 | (6 | ) | |||||||||
Morrill & Janes Bank and Trust Company | 1,707 | 2,133 | 2,525 | 1,096 | 2,024 | ||||||||||
Illinois Bank & Trust | 2,179 | 2,397 | 2,027 | 574 | 1,877 | ||||||||||
Premier Valley Bank | 1,804 | 1,695 | 1,960 | 1,008 | — | ||||||||||
Arizona Bank & Trust | 2,034 | 2,121 | 1,841 | 968 | 1,254 | ||||||||||
Rocky Mountain Bank | 1,456 | 1,484 | 1,064 | 1,506 | 1,471 | ||||||||||
Minnesota Bank & Trust | 675 | 559 | 531 | 166 | 411 | ||||||||||
(1) Formerly known as Summit Bank & Trust. |
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