EX-99.1 2 ex991q12019pressrelease.htm EXHIBIT 99.1 HTLF 2019 Q1 EARNINGS RELEASE Exhibit


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CONTACT:
FOR IMMEDIATE RELEASE
Bryan R. McKeag
April 29, 2019
Executive Vice President
 
Chief Financial Officer
 
(563) 589-1994
 
bmckeag@htlf.com
 

HEARTLAND FINANCIAL USA, INC. REPORTS IMPROVED YEAR OVER YEAR RESULTS FOR FIRST QUARTER 2019 AND ANNOUNCES SALE OF MORTGAGE SERVICING RIGHTS

Highlights
§
Quarterly net income available to common stockholders of $31.5 million in comparison with $23.3 million for the first quarter of the prior year, an increase of $8.2 million or 35%
§
Diluted earnings per common share of $0.91 in comparison with $0.76 for the first quarter of the prior year, an increase of $0.15 or 20%
§
Net interest margin of 4.12%, fully tax-equivalent (non-GAAP)(1) of 4.18%
§
Return on average common equity of 9.56% and return on average tangible common equity (non-GAAP)(1) of 15.24%
§
Tangible common equity ratio (non-GAAP)(1) of 8.60% in comparison to 7.59% at March 31, 2018
§
Efficiency ratio, fully tax-equivalent (non-GAAP)(1) of 65.23% in comparison with 68.21% for the first quarter of 2018
§
Completed the sale of Citizens Finance consumer loan portfolios and the sale of two branches at Wisconsin Bank & Trust
§
Signed an agreement to sell mortgage servicing rights of Dubuque Bank and Trust Company on April 26, 2019
 
Three Months Ended
March 31,
 
2019
 
2018
Net income available to common stockholders (in millions)
$
31.5

 
$
23.3

Diluted earnings per common share
0.91

 
0.76

 
 
 
 
Return on average assets
1.13
%
 
0.97
%
Return on average common equity
9.56

 
9.32

Return on average tangible common equity (non-GAAP)(1)
15.24

 
13.85

Net interest margin
4.12

 
4.19

Net interest margin, fully tax-equivalent (non-GAAP)(1)
4.18

 
4.26

Efficiency ratio, fully-tax equivalent (non-GAAP)(1)
65.23

 
68.21


(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to the financial tables for reconciliations to the most directly comparable GAAP measures.
"Heartland reported improved first quarter results with net income of $31.5 million, which was an impressive increase of $8.2 million or 35 percent over the same quarter of last year. We had a solid net interest margin and improved tangible common equity ratio."
Lynn B. Fuller, executive operating chairman, Heartland Financial USA, Inc.




Dubuque, Iowa, Monday, April 29, 2019-Heartland Financial USA, Inc. (NASDAQ: HTLF) today reported net income available to common stockholders of $31.5 million, or $0.91 per diluted common share, for the quarter ended March 31, 2019, compared to $23.3 million, or $0.76 per diluted common share, for the first quarter of 2018. Return on average common equity was 9.56% and return on average assets was 1.13% for the first quarter of 2019, compared to 9.32% and 0.97%, respectively, for the same quarter in 2018.

Commenting on Heartland’s first quarter results, Lynn B. Fuller, Heartland’s executive operating chairman, said, "Heartland reported improved first quarter results with net income of $31.5 million, which was an impressive increase of $8.2 million or 35 percent over the same quarter of last year. We had a solid net interest margin and improved tangible common equity ratio."

In keeping with its focus on core businesses and execution of strategic priorities, Heartland completed the sale of two branch locations of Wisconsin Bank & Trust and sold the consumer finance loan portfolios totaling approximately $67 million of Citizens’ Finance Company. Furthermore, during the quarter, Heartland announced an agreement to sell two branches of Dubuque Bank and Trust Company, which resulted in the reclassification of $20.3 million of loans and $77.0 million of deposits as held for sale. This transaction, along with two previously announced branch sales at Illinois Bank & Trust and Citywide Banks, is expected to close in the second quarter of 2019. Heartland also reclassified commercial loans with balances of $11.8 million at March 31, 2019, to held for sale as part of a plan to exit a small lease portfolio.
On April 26, 2019, Dubuque Bank and Trust Company signed an agreement to sell substantially all its mortgage servicing rights to PNC Bank, N.A., headquartered in Pittsburgh, Pennsylvania. The servicing rights had an estimated fair value of $37.0 million and a book value of $21.0 million as of March 31, 2019. The portfolio contained approximately 20,300 of serviced residential mortgage loans with unpaid principal balances of $3.35 billion as of March 31, 2019. The serviced loans are primarily owned by Fannie Mae and Freddie Mac. The transaction has been approved by Fannie Mae and Freddie Mac and is expected to close on April 30, 2019. In the agreement, which includes customary terms and conditions, Dubuque Bank and Trust Company will provide interim servicing of the loans until the transfer date, which is expected to be in August 2019.

"During the fourth quarter of 2018, Heartland outsourced mortgage loan originations in many of our markets, and now, as a natural extension, we have decided to sell our mortgage servicing rights," said Bruce K. Lee, Heartland's president and chief executive officer.

After the completion of this transaction, Heartland will continue to originate and service conventional residential mortgages through its PrimeWest Mortgage Corporation subsidiary in Texas.

Net Interest Income Increases, Net Interest Margin Decreases, from First Quarter of 2018

Net interest margin, expressed as a percentage of average earning assets, was 4.12% (4.18% on a fully tax-equivalent basis, non-GAAP) during the first quarter of 2019, compared to 4.28% (4.34% on a fully tax-equivalent basis, non-GAAP) during the fourth quarter of 2018 and 4.19% (4.26% on a fully tax-equivalent basis, non-GAAP) during the first quarter of 2018.

"We are pleased with the continued strength of our fully tax-equivalent net interest margin. Our net interest margin declined 16 basis points from last quarter, which was in line with our expectations due to the sale of our higher yielding consumer finance loan portfolios in the beginning of 2019," Lee said.

Growth in total interest income on a tax-equivalent basis was primarily due to recent increases in market interest rates and the increase in average earning assets. Total interest income for the first quarter of 2019 was $120.7 million compared to $101.2 million recorded in the first quarter of 2018, an increase of $19.5 million or 19%. The tax-equivalent adjustment for income taxes saved on the interest earned on nontaxable securities and loans was $1.4 million for the first quarter of 2019 and $1.5 million for the first quarter of 2018. With these adjustments, total interest income on a tax-equivalent basis was $122.1 million for the first quarter of 2019, an increase of $19.4 million or 19%, compared to total interest income on a tax-equivalent basis of $102.8 million for the first quarter of 2018. Average earning assets increased $1.27 billion or 14% from the first quarter of 2018, which was primarily attributable to the acquisitions completed in 2018. The average rate on earning assets increased 19 basis points to 4.89% for the first quarter of 2019 compared to 4.70% for the same quarter in 2018.





Increases in total interest expense were primarily due to recent increases in market interest rates and deposit growth from recent acquisitions. Total interest expense for the first quarter of 2019 was $17.8 million, an increase of $8.1 million or 84% from $9.6 million in the first quarter of 2018. The average interest rate paid on Heartland's interest bearing liabilities increased to 1.09% for the first quarter of 2019 compared to 0.69% for the first quarter of 2018, which was primarily due to recent increases in market interest rates. Average interest bearing deposits increased $889.5 million or 17% to $6.16 billion for the quarter ended March 31, 2019, from $5.27 billion in the same quarter in 2018, which was primarily attributable to recent acquisitions. The average interest rate paid on Heartland's interest bearing deposits increased 43 basis points to 0.87% for the first quarter of 2019 compared to 0.44% for the same quarter in 2018. Average borrowings increased $38.3 million or 9% to $466.2 million during the first quarter of 2019 from $427.9 million during the same quarter in 2018. The average interest rate paid on Heartland's borrowings was 3.96% for the first quarter of 2019 compared to 3.66% in the first quarter of 2018.

Net interest income was $103.0 million during the first quarter of 2019 compared to $91.6 million during the first quarter of 2018, an increase of $11.4 million or 12%. After the tax-equivalent adjustment discussed above, net interest income on a tax-equivalent basis totaled $104.4 million during the first quarter of 2019 compared to net interest income on a tax-equivalent basis of $93.1 million during the first quarter of 2018, an increase of $11.2 million or 12%.

Noninterest Income and Noninterest Expense Increase from First Quarter 2018

Total noninterest income was $26.7 million during the first quarter of 2019 compared to $24.7 million during the first quarter of 2018, an increase of $2.0 million or 8%. Significant changes by noninterest income category were:

•
Service charges and fees increased $2.7 million or 27% to $12.8 million for the first quarter of 2019 compared to $10.1 million for the same quarter of 2018. Service charges related to credit card income increased $1.1 million or 48% to $3.3 million for the first quarter of 2019 from $2.3 million for the same quarter of 2018. The remainder of the increase in service charges was primarily attributable to Heartland's larger customer base as a result of recent acquisitions.
•
Net gains on sale of loans held for sale totaled $3.2 million during the first quarter of 2019 compared to $4.1 million during the same quarter in 2018, which was a decrease of $875,000 or 22%, primarily due to the outsourcing of Heartland's legacy mortgage lending operations in the fourth quarter of 2018.

For the first quarter of 2019, total noninterest expense was $88.2 million compared to $83.6 million during the first quarter of 2018, an increase of $4.6 million or 5%. Significant changes by noninterest expense category were:

•
Salaries and employee benefits increased $1.6 million or 3% to $50.3 million for the first quarter of 2019 compared to $48.7 million for the same quarter in 2018.
•
Professional fees increased $1.9 million or 20% to $11.4 million for the first quarter of 2019 compared to $9.4 million for the same period in 2018.
•
Core deposit and customer relationship intangibles amortization increased $979,000 to $2.8 million for the first quarter of 2019 compared to $1.9 million for the first quarter of 2018, which was partially due to the write-off of $329,000 of core deposit intangibles related to the branch sales at Wisconsin Bank & Trust.
•
Gains on sales/valuations of assets, net, totaled $3.0 million and $197,000 for the first quarter of 2019 and 2018, respectively, with the increase of $2.8 million primarily attributable to the sale of the Wisconsin Bank & Trust branches.
•
Restructuring expenses totaled $3.2 million for the first quarter of 2019 compared to $2.6 million during the first quarter of 2018, which was an increase of $663,000 or 26%. Restructuring expenses in the first quarter of 2019 related to the wind down of Citizens' Finance Company and the legacy mortgage lending operations and consisted of severance and retention payments for employees, software discontinuation fees and expected lease buyouts.
•
Other noninterest expenses were $11.2 million for the first quarter of 2019 compared to $9.8 million for the first quarter of 2018, which was an increase of $1.4 million or 14%. Included in this increase was a write-down of $475,000 on a partnership investment that qualifies for solar energy tax credits.

The increases in salaries and employee benefits, professional fees, and the remainder of the increases in core deposit and customer relationship intangibles amortization and other noninterest expenses were primarily attributable to recent acquisitions.





Heartland's effective tax rate was 20.88% for the first quarter of 2019 compared to 18.04% for the first quarter of 2018. Federal low-income housing tax credits included in the determination of Heartland's income taxes totaled $281,000 for the first quarter of 2019 compared to $307,000 for the first quarter of 2018. Included in Heartland's first quarter 2019 tax calculation was a solar energy tax credit totaling $314,000. Tax-exempt interest income as a percentage of pre-tax income declined to 13.35% during the first quarter of 2019 from 20.46% during the first quarter of 2018.

Loans and Deposits Decrease Since December 31, 2018

Total assets were $11.31 billion at March 31, 2019, a decrease of $95.5 million or 1% from $11.41 billion at year-end 2018. Securities represented 22% and 24% of total assets at March 31, 2019, and December 31, 2018, respectively.

Total loans held to maturity were $7.33 billion at March 31, 2019, compared to $7.41 billion at year-end 2018, a decrease of $76.2 million or 1%. During the first quarter of 2019, the sale of two branches at Dubuque Bank and Trust Company was announced, which included $20.3 million of loans that were classified as held for sale at March 31, 2019. Heartland also reclassified commercial loans with balances of $11.8 million at March 31, 2019, to held for sale as part of a plan to exit a small lease portfolio. Exclusive of these transactions, total loans held to maturity decreased $44.0 million or less than 1% since year-end 2018. Loan changes by category were:

•
Commercial and commercial real estate loans totaled $5.75 billion at March 31, 2019, compared to $5.73 billion at December 31, 2018, which was an increase of $13.3 million or less than 1%. Excluding $14.9 million of commercial and commercial real estate loans classified as held for sale during the quarter, commercial and commercial real estate loans increased $28.2 million or less than 1% since year-end.
•
Agricultural and agricultural real estate loans totaled $544.8 million at March 31, 2019, compared to $565.4 million at year-end, which was a decrease of $20.6 million or 4%. Excluding $6.6 million of agricultural and agricultural real estate loans classified as held for sale during the quarter, agricultural and agricultural real estate loans decreased $14.0 million or 2% since December 31, 2018.
•
Residential mortgage loans decreased $43.2 million or 6% to $630.4 million at March 31, 2019, from $673.6 million at year-end. Excluding $2.0 million of residential mortgage loans classified as held for sale during the quarter, residential mortgage loans decreased $41.2 million or 6% since year-end.
•
Consumer loans decreased $27.6 million or 6% to $412.6 million at March 31, 2019, compared to $440.2 million at December 31, 2018. Excluding $8.6 million of loans classified as held for sale during the quarter, consumer loans decreased $19.0 million or 4% since year-end.

"We continued to see commercial and commercial real estate loan growth this quarter. The decreases in the residential mortgage and consumer loans were primarily the result of customers refinancing loans due to recent mortgage interest rate decreases," said Lee.

Total deposits were $9.35 billion as of March 31, 2019, compared to $9.40 billion at year-end 2018, a decrease of $43.5 million or less than 1%. The deposits classified as held for sale in conjunction with the branch sale announced at Dubuque Bank and Trust Company totaled $77.0 million at March 31, 2019. Excluding deposits classified as held for sale during the quarter, total deposits increased $33.5 million or less than 1% since December 31, 2018. Deposit changes by category were:

•
Demand deposits decreased $145.8 million or 4% to $3.12 billion at March 31, 2019, compared to $3.26 billion at December 31, 2018. Excluding $17.3 million of demand deposits classified as held for sale during the quarter, demand deposits decreased $128.6 million or 4% since year-end 2018.
•
Savings deposits increased $38.0 million or 1% to $5.15 billion at March 31, 2019, from $5.11 billion at December 31, 2018. Excluding savings deposits of $47.8 million classified as held for sale during the quarter, savings deposits increased $85.8 million or 2% since year-end 2018.
•
Time deposits increased $64.4 million or 6% to $1.09 billion at March 31, 2019 from $1.02 billion at December 31, 2018. Excluding time deposits of $11.9 million classified as held for sale during the quarter, time deposits increased $76.2 million or 7% since year-end 2018.

"Demand deposit balances declined during the first quarter, primarily due to commercial and public fund outflows, which tend to be seasonal. However, non-time deposits represent a healthy 88 percent of total deposits at March 31, 2019," Lee stated.





Nonperforming Assets Increase Since December 31, 2018

Nonperforming assets increased $5.1 million or 6% to $84.4 million or 0.75% of total assets at March 31, 2019, compared to $79.3 million or 0.69% of total assets at December 31, 2018. Nonperforming loans were $79.0 million or 1.08% of total loans at March 31, 2019, compared to $72.7 million or 0.98% of total loans at December 31, 2018. The increase is primarily related to two agribusiness relationships that were originated in Heartland's Midwestern markets. At March 31, 2019, loans delinquent 30-89 days were 0.47% of total loans compared to 0.21% of total loans at December 31, 2018.

The allowance for loan losses at March 31, 2019, was 0.85% of loans and 79.29% of nonperforming loans, compared to 0.84% of loans and 85.27% of nonperforming loans at December 31, 2018. The provision for loan losses decreased $2.6 million to $1.6 million for the first quarter of 2019 compared to $4.3 million for the same quarter in 2018.

Non-GAAP Financial Measures

This press release contains references to financial measures which are not defined by generally accepted accounting principles ("GAAP"). Management believes the non-GAAP measures are helpful for investors to analyze and evaluate Heartland's financial condition and operating results. However, these non-GAAP measures have inherent limitations and should not be considered a substitute for operating results determined in accordance with GAAP. Additionally, because non-GAAP measures are not standardized, it may not be possible to compare the non-GAAP measures in this press release with other companies' non-GAAP measures. Reconciliations of each non-GAAP measure to the most directly comparable GAAP measure may be found in the financial tables in this press release.

Below are the non-GAAP measures included in this press release, management's reason for including each measure and the method of calculating each measure:

•
Annualized return on average common tangible equity is net income available to common stockholders plus core deposit and customer relationship intangibles amortization, net of tax, divided by average common stockholders' equity less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength.
•
Annualized net interest margin, fully tax-equivalent, 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.
•
Efficiency ratio, fully tax equivalent, expresses noninterest expenses as a percentage of fully tax-equivalent net interest income and noninterest income. This efficiency ratio is presented on a tax-equivalent basis which adjusts net interest income and noninterest expenses for the tax favored status of certain loans, securities, and tax credit projects. 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 reconciliation contained in this press release.
•
Tangible book value per common share is total common stockholders' equity less goodwill and core deposit and customer relationship intangibles, net, divided by common shares outstanding, net of treasury. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.
•
Tangible common equity ratio is total common stockholders' equity less goodwill and core deposit and customer relationship intangibles, net, divided by total assets less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.

Conference Call Details
Heartland will host a conference call for investors at 5:00 p.m. EDT today. To participate, dial 877-407-0782 at least five minutes before start time. To listen to the live webcast, log on to www.htlf.com at least 15 minutes before start time. A replay will be available until April 28, 2020, by logging on to www.htlf.com.





About Heartland Financial USA, Inc.
Heartland Financial USA, Inc. is a diversified financial services company with assets of $11.3 billion. The company provides banking, mortgage, private client, investment, insurance and consumer finance services to individuals and businesses. Heartland currently has 116 banking locations serving 84 communities in Iowa, Illinois, Wisconsin, New Mexico, Arizona, Montana, Colorado, Minnesota, Kansas, Missouri, Texas and California. Additional information about Heartland Financial USA, Inc. is available at www.htlf.com.

Safe Harbor Statement
This release, and future oral and written statements of Heartland and its management, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about Heartland's financial condition, results of operations, plans, objectives, future performance and business. Although these forward-looking statements are based upon the beliefs, expectations and assumptions of Heartland's management, there are a number of factors, many of which are beyond the ability of management to control or predict, that could cause actual results to differ materially from those in its forward-looking statements. These factors, which are detailed in the risk factors in Heartland's Annual Report on Form 10-K filed with the Securities and Exchange Commission, contained, among others: (i) the strength of the local and national economy; (ii) the economic impact of past and any future terrorist threats and attacks and any acts of war; (iii) changes in state and federal laws, regulations and governmental policies as they impact the company's general business; (iv) changes in interest rates and prepayment rates of the company's assets; (v) increased competition in the financial services sector and the inability to attract new customers; (vi) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (vii) the potential impact of acquisitions and Heartland's ability to successfully integrate acquired banks; (viii) the loss of key executives or employees; (ix) changes in consumer spending; (x) unexpected outcomes of existing or new litigation involving the company; and (xi) changes in accounting policies and practices. All statements in this release, including forward-looking statements, speak only as of the date they are made, and Heartland undertakes no obligation to update any statement in light of new information or future events.


-FINANCIAL TABLES FOLLOW
-###





HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
For the Three Months Ended
March 31,
 
2019
 
2018
Interest Income
 
 
 
Interest and fees on loans
$
100,456

 
$
85,651

Interest on securities:
 
 
 
Taxable
15,876

 
11,577

Nontaxable
3,093

 
3,579

Interest on federal funds sold
4

 
—

Interest on deposits with other banks and other short-term investments
1,292

 
407

Total Interest Income
120,721

 
101,214

Interest Expense
 
 
 
Interest on deposits
13,213

 
5,766

Interest on short-term borrowings
889

 
268

Interest on other borrowings
3,664

 
3,596

Total Interest Expense
17,766

 
9,630

Net Interest Income
102,955

 
91,584

Provision for loan losses
1,635

 
4,263

Net Interest Income After Provision for Loan Losses
101,320

 
87,321

Noninterest Income
 
 
 
Service charges and fees
12,794

 
10,079

Loan servicing income
1,729

 
1,754

Trust fees
4,474

 
4,680

Brokerage and insurance commissions
734

 
907

Securities gains/(losses), net
1,575

 
1,441

Unrealized gain/(loss) on equity securities, net
258

 
(28
)
Net gains on sale of loans held for sale
3,176

 
4,051

Valuation adjustment on servicing rights
(589
)
 
(2
)
Income on bank owned life insurance
899

 
614

Other noninterest income
1,667

 
1,220

Total Noninterest Income
26,717

 
24,716

Noninterest Expense
 
 
 
Salaries and employee benefits
50,285

 
48,710

Occupancy
6,607

 
6,043

Furniture and equipment
2,692

 
2,749

Professional fees
11,379

 
9,448

Advertising
2,325

 
1,940

Core deposit and customer relationship intangibles amortization
2,842

 
1,863

Other real estate and loan collection expenses
701

 
732

(Gain)/loss on sales/valuations of assets, net
(3,004
)
 
(197
)
Restructuring expenses
3,227

 
2,564

Other noninterest expenses
11,176

 
9,794

Total Noninterest Expense
88,230

 
83,646

Income Before Income Taxes
39,807

 
28,391

Income taxes
8,310

 
5,123

Net Income
31,497

 
23,268

Preferred dividends
—

 
(13
)
Net Income Available to Common Stockholders
$
31,497

 
$
23,255

Earnings per common share-diluted
$
0.91

 
$
0.76

Weighted average shares outstanding-diluted
34,699,839

 
30,645,212





HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
For the Quarter Ended
 
3/31/2019
 
12/31/2018
 
9/30/2018
 
6/30/2018
 
3/31/2018
Interest Income
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
100,456

 
$
105,700

 
$
105,733

 
$
96,787

 
$
85,651

Interest on securities:
 
 
 
 
 
 
 
 
 
Taxable
15,876

 
15,851

 
14,433

 
12,270

 
11,577

Nontaxable
3,093

 
3,467

 
3,490

 
3,584

 
3,579

Interest on federal funds sold
4

 
—

 
—

 
—

 
—

Interest on deposits with other banks and other short-term investments
1,292

 
1,285

 
1,238

 
768

 
407

Total Interest Income
120,721

 
126,303

 
124,894

 
113,409

 
101,214

Interest Expense
 
 
 
 
 
 
 
 
 
Interest on deposits
13,213

 
11,826

 
10,092

 
7,983

 
5,766

Interest on short-term borrowings
889

 
417

 
464

 
547

 
268

Interest on other borrowings
3,664

 
3,777

 
3,660

 
3,470

 
3,596

Total Interest Expense
17,766

 
16,020

 
14,216

 
12,000

 
9,630

Net Interest Income
102,955

 
110,283

 
110,678

 
101,409

 
91,584

Provision for loan losses
1,635

 
9,681

 
5,238

 
4,831

 
4,263

Net Interest Income After Provision for Loan Losses
101,320

 
100,602

 
105,440

 
96,578

 
87,321

Noninterest Income
 
 
 
 
 
 
 
 
 
Service charges and fees
12,794

 
13,660

 
12,895

 
12,072

 
10,079

Loan servicing income
1,729

 
2,061

 
1,670

 
1,807

 
1,754

Trust fees
4,474

 
4,599

 
4,499

 
4,615

 
4,680

Brokerage and insurance commissions
734

 
1,618

 
1,111

 
877

 
907

Securities gains/(losses), net
1,575

 
48

 
(145
)
 
(259
)
 
1,441

Unrealized gain/(loss) on equity securities, net
258

 
115

 
54

 
71

 
(28
)
Net gains on sale of loans held for sale
3,176

 
3,189

 
7,410

 
6,800

 
4,051

Valuation adjustment on servicing rights
(589
)
 
(58
)
 
230

 
(216
)
 
(2
)
Income on bank owned life insurance
899

 
587

 
892

 
700

 
614

Other noninterest income
1,667

 
1,226

 
1,149

 
1,167

 
1,220

Total Noninterest Income
26,717

 
27,045

 
29,765

 
27,634

 
24,716

Noninterest Expense
 
 
 
 
 
 
 
 
 
Salaries and employee benefits
50,285

 
46,729

 
49,921

 
50,758

 
48,710

Occupancy
6,607

 
6,622

 
6,348

 
6,315

 
6,043

Furniture and equipment
2,692

 
3,126

 
3,470

 
3,184

 
2,749

Professional fees
11,379

 
10,630

 
12,800

 
10,632

 
9,448

Advertising
2,325

 
2,726

 
2,754

 
2,145

 
1,940

Core deposit and customer relationship intangibles amortization
2,842

 
2,592

 
2,626

 
2,274

 
1,863

Other real estate and loan collection expenses
701

 
574

 
784

 
948

 
732

(Gain)/loss on sales/valuations of assets, net
(3,004
)
 
(35
)
 
912

 
1,528

 
(197
)
Restructuring expenses
3,227

 
—

 
—

 
—

 
2,564

Other noninterest expenses
11,176

 
15,857

 
12,924

 
11,098

 
9,794

Total Noninterest Expense
88,230

 
88,821

 
92,539

 
88,882

 
83,646

Income Before Income Taxes
39,807

 
38,826

 
42,666

 
35,330

 
28,391

Income taxes
8,310

 
6,685

 
8,956

 
7,451

 
5,123

Net Income
31,497

 
32,141

 
33,710

 
27,879

 
23,268

Preferred dividends
—

 
—

 
(13
)
 
(13
)
 
(13
)
Net Income Available to Common Stockholders
$
31,497

 
$
32,141

 
$
33,697

 
$
27,866

 
$
23,255

Earnings per common share-diluted
$
0.91

 
$
0.93

 
$
0.97

 
$
0.85

 
$
0.76

Weighted average shares outstanding-diluted
34,699,839

 
34,670,180

 
34,644,187

 
32,830,751

 
30,645,212






HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
As of
 
3/31/2019
 
12/31/2018
 
9/30/2018
 
6/30/2018
 
3/31/2018
Assets
 
 
 
 
 
 
 
 
 
Cash and due from banks
$
174,198

 
$
223,135

 
$
196,847

 
$
193,069

 
$
143,071

Interest bearing deposits with other banks and other short-term investments
318,303

 
50,495

 
240,528

 
194,937

 
123,275

Cash and cash equivalents
492,501

 
273,630

 
437,375

 
388,006

 
266,346

Time deposits in other financial institutions
4,675

 
4,672

 
5,836

 
6,803

 
6,297

Securities:
 
 
 
 
 
 
 
 
 
Carried at fair value
2,400,460

 
2,450,709

 
2,274,215

 
2,197,117

 
2,027,665

Held to maturity, at cost
88,089

 
236,283

 
239,908

 
244,271

 
249,766

Other investments, at cost
27,506

 
28,396

 
26,656

 
26,725

 
22,982

Loans held for sale
69,716

 
119,801

 
77,727

 
55,684

 
24,376

Loans:
 
 
 
 
 
 
 
 
 
Held to maturity
7,331,544

 
7,407,697

 
7,365,493

 
7,477,697

 
6,746,015

 Allowance for loan losses
(62,639
)
 
(61,963
)
 
(61,221
)
 
(61,324
)
 
(58,656
)
Loans, net
7,268,905

 
7,345,734

 
7,304,272

 
7,416,373

 
6,687,359

Premises, furniture and equipment, net
190,215

 
194,676

 
198,224

 
199,959

 
172,862

Goodwill
391,668

 
391,668

 
391,668

 
391,668

 
270,305

Core deposit and customer relationship intangibles, net
44,637

 
47,479

 
50,071

 
52,698

 
41,063

Servicing rights, net
28,968

 
31,072

 
32,039

 
31,996

 
25,471

Cash surrender value on life insurance
163,764

 
162,892

 
162,216

 
159,302

 
143,444

Other real estate, net
5,391

 
6,153

 
11,908

 
11,074

 
11,801

Other assets
136,000

 
114,841

 
123,017

 
120,244

 
106,126

Total Assets
$
11,312,495

 
$
11,408,006

 
$
11,335,132

 
$
11,301,920

 
$
10,055,863

Liabilities and Equity
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
 
 
 
 Demand
$
3,118,909

 
$
3,264,737

 
$
3,427,819

 
$
3,399,598

 
$
3,094,457

 Savings
5,145,929

 
5,107,962

 
4,958,430

 
4,864,773

 
4,536,106

 Time
1,088,104

 
1,023,730

 
1,125,914

 
1,224,773

 
910,977

Total deposits
9,352,942

 
9,396,429

 
9,512,163

 
9,489,144

 
8,541,540

Deposits held for sale
118,564

 
106,409

 
50,312

 
—

 
—

Short-term borrowings
104,314

 
227,010

 
131,139

 
229,890

 
131,240

Other borrowings
268,312

 
274,905

 
277,563

 
258,708

 
276,118

Accrued expenses and other liabilities
96,261

 
78,078

 
83,562

 
68,431

 
55,460

Total Liabilities
9,940,393

 
10,082,831

 
10,054,739

 
10,046,173

 
9,004,358

Stockholders' Equity
 
 
 
 
 
 
 
 
 
Preferred equity
—

 
—

 
—

 
938

 
938

Common stock
34,604

 
34,477

 
34,473

 
34,438

 
31,068

Capital surplus
745,596

 
743,095

 
742,080

 
740,128

 
557,990

Retained earnings
603,506

 
579,252

 
553,662

 
524,786

 
500,959

Accumulated other comprehensive loss
(11,604
)
 
(31,649
)
 
(49,822
)
 
(44,543
)
 
(39,450
)
Total Equity
1,372,102

 
1,325,175

 
1,280,393

 
1,255,747

 
1,051,505

Total Liabilities and Equity
$
11,312,495

 
$
11,408,006

 
$
11,335,132

 
$
11,301,920

 
$
10,055,863







HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
For the Quarter Ended
 
3/31/2019
 
12/31/2018
 
9/30/2018
 
6/30/2018
 
3/31/2018
Average Balances
 
 
 
 
 
 
 
 
 
Assets
$
11,267,214

 
$
11,371,247

 
$
11,291,289

 
$
10,643,306

 
$
9,759,936

Loans, net of unearned
7,412,855

 
7,436,497

 
7,462,176

 
7,123,182

 
6,525,553

Deposits
9,356,204

 
9,596,807

 
9,530,743

 
9,018,945

 
8,251,140

Earning assets
10,129,957

 
10,225,409

 
10,154,591

 
9,614,800

 
8,857,801

Interest bearing liabilities
6,622,149

 
6,557,185

 
6,544,949

 
6,205,187

 
5,694,337

Common stockholders' equity
1,336,250

 
1,290,691

 
1,263,226

 
1,139,876

 
1,011,580

Total stockholders' equity
1,336,250

 
1,290,691

 
1,263,795

 
1,140,814

 
1,012,518

Tangible common stockholders' equity (non-GAAP)
898,092

 
849,851

 
819,966

 
767,732

 
723,898

 
 
 
 
 
 
 
 
 
 
Key Performance Ratios
 
 
 
 
 
 
 
 
 
Annualized return on average assets
1.13
%
 
1.12
%
 
1.18
%
 
1.05
%
 
0.97
%
Annualized return on average common equity (GAAP)
9.56
%
 
9.88
%
 
10.58
%
 
9.81
%
 
9.32
%
Annualized return on average tangible common
equity (non-GAAP)(1)
15.24
%
 
15.96
%
 
17.31
%
 
15.50
%
 
13.85
%
Annualized ratio of net charge-offs to average loans
0.05
%
 
0.48
%
 
0.28
%
 
0.12
%
 
0.08
%
Annualized net interest margin (GAAP)
4.12
%
 
4.28
%
 
4.32
%
 
4.23
%
 
4.19
%
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1)
4.18
%
 
4.34
%
 
4.38
%
 
4.30
%
 
4.26
%
Efficiency ratio, fully tax-equivalent (non-GAAP)(1)
65.23
%
 
59.35
%
 
62.51
%
 
64.94
%
 
68.21
%
 
 
 
 
 
 
 
 
 
 
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)
 
 
 
 
 
 
 
 
 
Net income available to common shareholders (GAAP)
$
31,497

 
$
32,141

 
$
33,697

 
$
27,866

 
$
23,255

Plus core deposit and customer relationship intangibles amortization, net of tax(2)
2,245

 
2,048

 
2,075

 
1,796

 
1,472

Adjusted net income available to common shareholders (non-GAAP)
$
33,742

 
$
34,189

 
$
35,772

 
$
29,662

 
$
24,727

 
 
 
 
 
 
 
 
 
 
Average common stockholders' equity (GAAP)
$
1,336,250

 
$
1,290,691

 
$
1,263,226

 
$
1,139,876

 
$
1,011,580

   Less average goodwill
391,668

 
391,668

 
391,668

 
325,781

 
250,172

Less average core deposit and customer relationship intangibles, net
46,490

 
49,172

 
51,592

 
46,363

 
37,510

Average tangible common stockholders' equity (non-GAAP)
$
898,092

 
$
849,851

 
$
819,966

 
$
767,732

 
$
723,898

Annualized return on average common equity (GAAP)
9.56
%
 
9.88
%
 
10.58
%
 
9.81
%
 
9.32
%
Annualized return on average tangible common equity (non-GAAP)
15.24
%
 
15.96
%
 
17.31
%
 
15.50
%
 
13.85
%
 
 
 
 
 
 
 
 
 
 
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)
 
 
 
 
 
 
 
 
 
Net Interest Income (GAAP)
$
102,955

 
$
110,283

 
$
110,678

 
$
101,409

 
$
91,584

    Plus tax-equivalent adjustment(2)
1,412

 
1,565

 
1,544

 
1,575

 
1,544

Net interest income, fully tax-equivalent (non-GAAP)
$
104,367

 
$
111,848

 
$
112,222

 
$
102,984

 
$
93,128

 
 
 
 
 
 
 
 
 
 
Average earning assets
$
10,129,957

 
$
10,225,409

 
$
10,154,591

 
$
9,614,800

 
$
8,857,801

 
 
 
 
 
 
 
 
 
 
Annualized net interest margin (GAAP)
4.12
%
 
4.28
%
 
4.32
%
 
4.23
%
 
4.19
%
Annualized net interest margin, fully tax-equivalent (non-GAAP)
4.18
%
 
4.34
%
 
4.38
%
 
4.30
%
 
4.26
%
 
(1) Refer to the "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.
(2) Computed on a tax-equivalent basis using an effective tax rate of 21%.
 
 
 
 
 
 
 
 
 




HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
Reconciliation of Efficiency Ratio (non-GAAP)
For the Quarter Ended
3/31/2019
 
12/31/2018
 
9/30/2018
 
6/30/2018
 
3/31/2018
Net interest income
$
102,955

 
$
110,283

 
$
110,678

 
$
101,409

 
$
91,584

Tax-equivalent adjustment(1)
1,412

 
1,565

 
1,544

 
1,575

 
1,544

Fully tax-equivalent net interest income
104,367

 
111,848

 
112,222

 
102,984

 
93,128

Noninterest income
26,717

 
27,045

 
29,765

 
27,634

 
24,716

Securities (gains)/losses, net
(1,575
)
 
(48
)
 
145

 
259

 
(1,441
)
Unrealized (gain)/loss on equity securities, net
(258
)
 
(115
)
 
(54
)
 
(71
)
 
28

Valuation adjustment on servicing rights
589

 
58

 
(230
)
 
216

 
2

Adjusted income
$
129,840

 
$
138,788

 
$
141,848

 
$
131,022

 
$
116,433

 
 
 
 
 
 
 
 
 
 
Total noninterest expenses
$
88,230

 
$
88,821

 
$
92,539

 
$
88,882

 
$
83,646

Less:
 
 
 
 
 
 
 
 
 
Core deposit and customer relationship intangibles amortization
2,842

 
2,592

 
2,626

 
2,274

 
1,863

Partnership investment in tax credit projects
475

 
3,895

 
338

 
—

 
—

(Gain)/loss on sales/valuation of assets, net
(3,004
)
 
(35
)
 
912

 
1,528

 
(197
)
Restructuring expenses
3,227

 
—

 
—

 
—

 
2,564

Adjusted noninterest expenses
$
84,690

 
$
82,369

 
$
88,663

 
$
85,080

 
$
79,416

 
 
 
 
 
 
 
 
 
 
Efficiency ratio, fully tax-equivalent (non-GAAP)
65.23
%
 
59.35
%
 
62.51
%
 
64.94
%
 
68.21
%
 
 
 
 
 
 
 
 
 
 
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.





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
 
3/31/2019
 
12/31/2018
 
9/30/2018
 
6/30/2018
 
3/31/2018
Common Share Data
 
 
 
 
 
 
 
 
 
Book value per common share
$
39.65

 
$
38.44

 
$
37.14

 
$
36.44

 
$
33.81

Tangible book value per common share (non-GAAP)(1)
$
27.04

 
$
25.70

 
$
24.33

 
$
23.53

 
$
23.79

Common shares outstanding, net of treasury stock
34,603,611

 
34,477,499

 
34,473,029

 
34,438,445

 
31,068,239

Tangible common equity ratio (non-GAAP)(1)
8.60
%
 
8.08
%
 
7.70
%
 
7.46
%
 
7.59
%
 
 
 
 
 
 
 
 
 
 
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)
 
 
 
 
 
 
 
 
 
Common stockholders' equity (GAAP)
$
1,372,102

 
$
1,325,175

 
$
1,280,393

 
$
1,254,809

 
$
1,050,567

Less goodwill
391,668

 
391,668

 
391,668

 
391,668

 
270,305

Less core deposit and customer relationship intangibles, net
44,637

 
47,479

 
50,071

 
52,698

 
41,063

Tangible common stockholders' equity (non-GAAP)
$
935,797

 
$
886,028

 
$
838,654

 
$
810,443

 
$
739,199

 
 
 
 
 
 
 
 
 
 
Common shares outstanding, net of treasury stock
34,603,611

 
34,477,499

 
34,473,029

 
34,438,445

 
31,068,239

Common stockholders' equity (book value) per share (GAAP)
$
39.65

 
$
38.44

 
$
37.14

 
$
36.44

 
$
33.81

Tangible book value per common share (non-GAAP)
$
27.04

 
$
25.70

 
$
24.33

 
$
23.53

 
$
23.79

 
 
 
 
 
 
 
 
 
 
Reconciliation of Tangible Common Equity Ratio (non-GAAP)
 
 
 
 
 
 
 
 
 
Tangible common stockholders' equity (non-GAAP)
$
935,797

 
$
886,028

 
$
838,654

 
$
810,443

 
$
739,199

 
 
 
 
 
 
 
 
 
 
Total assets (GAAP)
$
11,312,495

 
$
11,408,006

 
$
11,335,132

 
$
11,301,920

 
$
10,055,863

    Less goodwill
391,668

 
391,668

 
391,668

 
391,668

 
270,305

 Less core deposit and customer relationship intangibles, net
44,637

 
47,479

 
50,071

 
52,698

 
41,063

Total tangible assets (non-GAAP)
$
10,876,190

 
$
10,968,859

 
$
10,893,393

 
$
10,857,554

 
$
9,744,495

Tangible common equity ratio (non-GAAP)
8.60
%
 
8.08
%
 
7.70
%
 
7.46
%
 
7.59
%
 
 
 
 
 
 
 
 
 
 
Loan Data
 
 
 
 
 
 
 
 
 
Loans held to maturity:
 
 
 
 
 
 
 
 
 
Commercial and commercial real estate
$
5,745,051

 
$
5,731,712

 
$
5,610,953

 
$
5,721,138

 
$
5,129,777

Residential mortgage
630,433

 
673,603

 
676,941

 
683,051

 
624,725

Agricultural and agricultural real estate
544,805

 
565,408

 
574,048

 
562,353

 
518,386

Consumer
412,573

 
440,158

 
506,181

 
512,899

 
474,929

Unearned discount and deferred loan fees
(1,318
)
 
(3,184
)
 
(2,630
)
 
(1,744
)
 
(1,802
)
Total loans held to maturity
$
7,331,544

 
$
7,407,697

 
$
7,365,493

 
$
7,477,697

 
$
6,746,015

 
 
 
 
 
 
 
 
 
 
Other Selected Trend Information
 
 
 
 
 
 
 
 
 
Effective tax rate
20.88
%
 
17.22
%
 
20.99
%
 
21.09
%
 
18.04
%
Full time equivalent employees
1,976

 
2,045

 
2,124

 
2,216

 
2,022

 
 
 
 
 
 
 
 
 
 
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.





HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 
As of and for the Quarter Ended
 
3/31/2019
 
12/31/2018
 
9/30/2018
 
6/30/2018
 
3/31/2018
Allowance for Loan Losses
 
 
 
 
 
 
 
 
 
Balance, beginning of period
$
61,963

 
$
61,221

 
$
61,324

 
$
58,656

 
$
55,686

Provision for loan losses
1,635

 
9,681

 
5,238

 
4,831

 
4,263

Charge-offs
(1,950
)
 
(9,777
)
 
(6,120
)
 
(3,164
)
 
(2,224
)
Recoveries
991

 
838

 
779

 
1,001

 
931

Balance, end of period
$
62,639

 
$
61,963

 
$
61,221

 
$
61,324

 
$
58,656

 
 
 
 
 
 
 
 
 
 
Asset Quality
 
 
 
 
 
 
 
 
 
Nonaccrual loans
$
77,294

 
$
71,943

 
$
73,060

 
$
69,376

 
$
64,806

Loans past due ninety days or more
1,706

 
726

 
154

 
54

 
22

Other real estate owned
5,391

 
6,153

 
11,908

 
11,074

 
11,801

Other repossessed assets
8

 
459

 
495

 
499

 
423

Total nonperforming assets
$
84,399

 
$
79,281

 
$
85,617

 
$
81,003

 
$
77,052

 
 
 
 
 
 
 
 
 
 
Performing troubled debt restructured loans
$
3,460

 
$
4,026

 
$
4,180

 
$
4,012

 
$
3,206

 
 
 
 
 
 
 
 
 
 
Nonperforming Assets Activity
 
 
 
 
 
 
 
 
 
Balance, beginning of period
$
79,281

 
$
85,617

 
$
81,003

 
$
77,052

 
$
74,599

Net loan charge offs
(959
)
 
(8,939
)
 
(5,341
)
 
(2,163
)
 
(1,293
)
New nonperforming loans
15,314

 
17,332

 
16,965

 
16,254

 
8,546

Acquired nonperforming assets
—

 
—

 
—

 
7,973

 
2,459

Reduction of nonperforming loans(1)
(6,238
)
 
(6,065
)
 
(5,085
)
 
(15,696
)
 
(6,549
)
OREO/Repossessed assets sales proceeds
(2,092
)
 
(8,390
)
 
(1,064
)
 
(1,541
)
 
(657
)
OREO/Repossessed assets writedowns, net
(462
)
 
(230
)
 
(886
)
 
(993
)
 
(16
)
Net activity at Citizens Finance Co.
(445
)
 
(44
)
 
25

 
117

 
(37
)
Balance, end of period
$
84,399

 
$
79,281

 
$
85,617

 
$
81,003

 
$
77,052

 
Asset Quality Ratios
 
 
 
 
 
 
 
 
 
Ratio of nonperforming loans to total loans
1.08
%
 
0.98
%
 
0.99
%
 
0.93
%
 
0.96
%
Ratio of nonperforming assets to total assets
0.75
%
 
0.69
%
 
0.76
%
 
0.72
%
 
0.77
%
Annualized ratio of net loan charge-offs to average loans
0.05
%
 
0.48
%
 
0.28
%
 
0.12
%
 
0.08
%
Allowance for loan losses as a percent of loans
0.85
%
 
0.84
%
 
0.83
%
 
0.82
%
 
0.87
%
Allowance for loan losses as a percent of nonperforming loans
79.29
%
 
85.27
%
 
83.62
%
 
88.32
%
 
90.48
%
Loans delinquent 30-89 days as a percent of total loans
0.47
%
 
0.21
%
 
0.62
%
 
0.30
%
 
0.21
%
 
 
 
 
 
 
 
 
 
 
(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

March 31, 2019

December 31, 2018
 
March 31, 2018

Average
Balance

Interest

Rate

Average Balance

Interest

Rate
 
Average
Balance

Interest

Rate
Earning Assets











 





Securities:











 





Taxable
$
2,169,016


$
15,876


2.97
%

$
2,184,096


$
15,851


2.88
%
 
$
1,827,611


$
11,577


2.57
%
Nontaxable(1)
391,724


3,915


4.05


427,332


4,388


4.07

 
448,641


4,530


4.09

Total securities
2,560,740


19,791


3.13


2,611,428


20,239


3.07

 
2,276,252


16,107


2.87

Interest on deposits with other banks and other short-term investments
218,445


1,292


2.40


238,087


1,285


2.14

 
112,024


407


1.47

Federal funds sold
560


4


2.90


309


—


—

 
—


—


—

Loans:(2)











 





Commercial and commercial real estate(1)
5,745,180


78,083


5.51


5,644,475


77,822


5.47

 
4,910,797


62,813


5.19

Residential mortgage
673,682


7,179


4.32


704,012


8,682


4.89

 
642,181


6,851


4.33

Agricultural and agricultural real estate(1)
554,506


7,301


5.34


568,904


7,752


5.41

 
513,780


6,004


4.74

Consumer
439,487


6,479


5.98


519,106


9,355


7.15

 
458,795


8,660


7.66

Fees on loans


2,004


—


—


2,733


—

 


1,916


—

Less: allowance for loan losses
(62,643
)

—


—


(60,912
)

—


—

 
(56,028
)

—


—

Net loans
7,350,212


101,046


5.58


7,375,585


106,344


5.72

 
6,469,525


86,244


5.41

Total earning assets
10,129,957


122,133


4.89
%

10,225,409


127,868


4.96
%
 
8,857,801


102,758


4.70
%
Nonearning Assets
1,137,257






1,145,838







 
902,135





Total Assets
$
11,267,214






$
11,371,247







 
$
9,759,936





Interest Bearing Liabilities(3)











 





Savings
$
5,121,179


$
10,083


0.80
%

$
5,071,573


$
8,817


0.69
%
 
$
4,358,508


$
3,791


0.35
%
Time deposits
1,034,744


3,130


1.23


1,088,122


3,009


1.10

 
907,928


1,975


0.88

Short-term borrowings
195,390


889


1.85


121,053


417


1.37

 
147,738


268


0.74

Other borrowings
270,836


3,664


5.49


276,437


3,777


5.42

 
280,163


3,596


5.21

Total interest bearing liabilities
6,622,149


17,766


1.09
%

6,557,185


16,020


0.97
%
 
5,694,337


9,630


0.69
%
Noninterest Bearing Liabilities(3)











 





Noninterest bearing deposits
3,200,281






3,437,112







 
2,984,704





Accrued interest and other liabilities
108,534






86,259







 
68,377





Total noninterest bearing liabilities
3,308,815






3,523,371







 
3,053,081





Stockholders' Equity
1,336,250






1,290,691







 
1,012,518





Total Liabilities and Stockholders' Equity
$
11,267,214






$
11,371,247







 
$
9,759,936





Net interest income, fully tax-equivalent (non-GAAP)(1)


$
104,367






$
111,848



 


$
93,128



Net interest spread(1)




3.80
%





3.99
%
 




4.01
%
Net interest income, fully tax-equivalent (non-GAAP) to total earning assets




4.18
%





4.34
%
 




4.26
%







 
 
 
 
 
 





(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Nonaccrual loans and loans held for sale are included in the average loans outstanding.
(3) Includes deposits held for sale




HEARTLAND FINANCIAL USA, INC.
SELECTED FINANCIAL DATA - SUBSIDIARY BANKS (Unaudited)
DOLLARS IN THOUSANDS
 
As of and For the Quarter Ended
 
3/31/2019
12/31/2018
9/30/2018
6/30/2018
3/31/2018
Total Assets
 
 
 
 
 
Citywide Banks
$
2,214,105

$
2,307,284

$
2,300,018

$
2,295,261

$
2,299,818

Dubuque Bank and Trust Company
1,550,487

1,480,914

1,523,447

1,500,108

1,490,100

New Mexico Bank & Trust
1,500,024

1,492,555

1,465,020

1,466,311

1,416,788

First Bank & Trust
1,099,759

1,109,929

1,112,464

1,123,559

—

Wisconsin Bank & Trust
1,031,305

1,114,352

1,051,160

1,034,075

1,017,053

Premier Valley Bank
855,473

849,696

851,358

846,215

805,014

Illinois Bank & Trust
810,357

804,907

795,132

815,905

751,371

Arizona Bank & Trust
669,806

658,714

650,032

653,596

633,474

Minnesota Bank & Trust
657,187

666,564

649,179

660,469

631,852

Morrill & Janes Bank and Trust Company
564,833

571,012

592,786

602,630

648,568

Rocky Mountain Bank
489,135

490,453

492,063

504,243

490,917

Total Deposits(1)
 
 
 
 
 
Citywide Banks
$
1,802,701

$
1,848,373

$
1,905,830

$
1,867,626

$
1,914,726

Dubuque Bank and Trust Company
1,245,553

1,214,541

1,217,976

1,136,431

1,193,271

New Mexico Bank & Trust
1,313,708

1,307,464

1,267,844

1,242,673

1,202,051

First Bank & Trust
857,313

861,629

875,170

887,181

—

Wisconsin Bank & Trust
872,090

927,821

891,167

874,035

835,919

Premier Valley Bank
676,849

639,194

706,125

696,460

660,070

Illinois Bank & Trust
735,101

715,482

726,790

753,022

674,391

Arizona Bank & Trust
593,089

574,762

550,530

558,895

567,515

Minnesota Bank & Trust
546,706

560,399

544,513

561,257

533,893

Morrill & Janes Bank and Trust Company
473,712

489,471

511,154

498,798

558,174

Rocky Mountain Bank
426,503

424,700

429,167

443,359

429,000

Net Income
 
 
 
 
 
Citywide Banks
$
7,283

$
7,005

$
7,762

$
7,018

$
5,463

Dubuque Bank and Trust Company
5,011

6,002

4,458

4,426

3,214

New Mexico Bank & Trust
7,847

6,007

7,104

7,043

6,444

First Bank & Trust
2,792

3,334

3,932

1,925

—

Wisconsin Bank & Trust
4,707

3,229

3,735

2,470

2,617

Premier Valley Bank
2,411

2,930

3,006

2,664

2,373

Illinois Bank & Trust
2,632

2,180

2,419

2,421

2,712

Arizona Bank & Trust
2,780

1,951

2,660

3,623

2,104

Minnesota Bank & Trust
1,454

1,038

2,167

581

762

Morrill & Janes Bank and Trust Company
1,172

324

165

961

1,186

Rocky Mountain Bank
1,358

1,230

1,210

1,185

1,172

 
(1) Includes deposits held for sale.