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Simmons First Announces 110% Increase in Core Earnings

PINE BLUFF, Ark., April 23, 2015 (GLOBE NEWSWIRE) -- Simmons First National Corporation (Nasdaq:SFNC) today announced record core earnings of $15.7 million for the first quarter of 2015, an increase of $8.2 million, or 110%, compared to the same quarter last year. Diluted core earnings per share were $0.70, an increase of $0.24, or 52%. Core earnings exclude $7.0 million in net after-tax expenses.

Net income was $8.7 million for the first quarter of 2015, an increase of $4.4 million, or 100%, compared to the same quarter last year. Diluted earnings per share were $0.39, an increase of $0.12, or 44%.

"We are pleased with our integration planning and execution and continue to make good progress with our efficiency initiatives, both in revenue enhancement and in expense control," commented George A. Makris, Jr., Chairman and CEO. "We welcome our newest associates from Community First and Liberty and look forward to continued growth and profitability in their legacy markets."

Loans

Total loans, including those acquired, were $4.6 billion at March 31, 2015, an increase of $2.3 billion, or 95.9%, compared to the same period in 2014. Legacy loans (all loans excluding acquired loans) grew $336 million, or 18.9%. Acquired loans increased by $1.9 billion, net of discounts.

Deposits

At March 31, 2015, total deposits were $6.3 billion, an increase of $2.6 billion, or 69.3%, compared to the same period in 2014. Total non-time deposits were $4.8 billion, or 76% of total deposits.

Net Interest Income

The Company's net interest income for the first quarter of 2015 was $53.0 million, an increase of $11.4 million, or 27.5%, from the same period of 2014. This increase was driven by growth in the legacy loan portfolio and earning assets acquired through the Delta Trust, Community First and Liberty transactions. Net interest margin was 4.34% for the quarter ended March 31, 2015, a 20 basis point decline from the same quarter of 2014.

Included in interest income for both periods was the additional yield accretion recognized as a result of updated estimates of the cash flows of the acquired loans. Each quarter, the Company estimates the cash flows expected to be collected from the acquired loans, and adjustments may or may not be required. The cash flows estimate has increased based on payment histories and reduced loss expectations of the loans. This resulted in increased interest income recognized during the quarter on certain loans and interest income that is spread on a level-yield basis over the remaining expected lives of the loans or loan pools. For loans covered under loss sharing agreements with the FDIC, the increases in expected cash flows also reduce the amount of expected reimbursements, which are recorded as indemnification assets.

The impact of the adjustments on the Company's financial results for the current reporting period is shown below:

Three Months Ended
(In thousands) March 31
2015 2014
Impact on net interest income $ 6,102 $ 7,391
Non-interest income (2,745) (7,441)
Net impact to pre-tax income $ 3,357 $ (50)

Because these adjustments will be recognized over the remaining lives of the loans and the remainder of the loss sharing agreements, respectively, they will impact future periods as well. The current estimate of the remaining accretable yield adjustment that will positively impact interest income is $14.3 million and the remaining adjustment to the indemnification assets that will reduce non-interest income is $6.6 million. Of the remaining adjustments, we expect to recognize $6.2 million of interest income and a $5.6 million reduction of non-interest income, for a net increase to pre-tax income of approximately $0.6 million during the remainder of 2015. The accretable yield adjustments recorded in future periods will change as the Company continues to evaluate expected cash flows from the acquired loans.

Non-Interest Income

Non-interest income for the first quarter was $18.5 million, an increase of $9.3 million compared to the first quarter of 2014. Losses on FDIC covered assets decreased $4.7 million primarily due to lower indemnification asset amortization. The remaining increase in non-interest income was primarily due to additional trust income, service charge and fee income, mortgage lending and investment banking income resulting from the acquisitions.

Non-Interest Expense

Non-interest expense for the first quarter of 2015 was $57.4 million, an increase of $12.8 million compared to the same period in 2014. Included in the quarter were $10.4 million of various merger related costs for the Company's acquisition of Liberty and Community First. During the first quarter of 2014, the Company recorded $5.2 million in merger related and branch right sizing costs, resulting in an increase in merger related expenses of $5.2 million. The remaining increase in non-interest expense was primarily due to incremental operating expenses of the acquired Delta Trust, Community First and Liberty franchises.

Asset Quality

Beginning in 2010, the Company has acquired loans and foreclosed real estate ("OREO") through FDIC-assisted acquisitions. Through the loss share provisions of the purchase and assumption agreements, the FDIC agreed to reimburse the Company for 80% of the losses incurred on the disposition of covered loans and OREO. The acquired loans and OREO and any related FDIC loss share indemnification asset were presented in the Company's financial reports with a carrying value equal to the discounted net present value of expected future proceeds. At March 31, 2015, acquired loans covered by loss share were carried at $102 million, OREO covered by loss share was carried at $12 million and the FDIC loss share indemnification asset was carried at $16 million. Acquired loans and OREO not covered by loss share were carried at $2.4 billion and $31 million, respectively. As a result of using the discounted net present value method of valuing these assets, and due to the significant protection against possible losses provided by the FDIC loss share indemnification, all acquired assets, with the exception of OREO not covered by loss share, are excluded from the computations of the asset quality ratios for the legacy loan portfolio, except for their inclusion in total assets.

"At March 31, 2015, the allowance for loan losses was $29.2 million on legacy loans and $1.0 million on covered loans, and the loan credit mark was $96.0 million, for a total of $126.2 million of coverage. This equates to a total coverage ratio of 2.7% of gross loans. The ratio of credit mark and related allowance to acquired loans was 3.7%," explained Makris. The Company's allowance for loan losses at March 31, 2015, was 1.38% of total loans and 194% of non-performing loans. Non-performing loans as a percent of total loans were 0.71%. For the first quarter, the annualized net charge-off ratio, excluding credit cards, was 0.09%, and the annualized credit card charge-off ratio was 1.32%.

Capital

At March 31, 2015, stockholders' equity was $1.0 billion, book value per share was $33.96 and tangible book value per share was $21.82. The Company's ratio of stockholders' equity to total assets was 13.0% and its ratio of tangible common equity to tangible assets was 8.3%.

Simmons First National Corporation

Simmons First National Corporation is an Arkansas based financial holding company with total assets of $7.8 billion and conducting financial operations throughout Arkansas, Kansas, Missouri and Tennessee. The Company's common stock trades on the NASDAQ Global Select Market under the symbol "SFNC".

Conference Call

Management will conduct a conference call to review this information beginning at 3:00 p.m. Central Time on Thursday, April 23, 2015. Interested persons can listen to this call by dialing toll-free 1-866-298-7926 (United States and Canada only) and asking for the Simmons First National Corporation conference call, conference ID 15375652. In addition, the call will be available live or in recorded version on the Company's website at www.simmonsfirst.com.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles (GAAP). The Company's management uses these non-GAAP financial measures in their analysis of the Company's performance. These measures typically adjust GAAP performance measures to include the tax benefit associated with revenue items that are tax-exempt, as well as adjust income available to common shareholders for certain significant activities or nonrecurring transactions. Since the presentation of these GAAP performance measures and their impact differ between companies, management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company's core businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Forward Looking Statements

Statements in this press release that are not historical facts should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements of this type speak only as of the date of this news release. By nature, forward-looking statements involve inherent risk and uncertainties. Various factors, including, but not limited to, economic conditions, credit quality, interest rates, loan demand and changes in the assumptions used in making the forward-looking statements, could cause actual results to differ materially from those contemplated by the forward-looking statements. Additional information on factors that might affect Simmons First National Corporation's financial results is included in its Form 10-K filing with the Securities and Exchange Commission.

Simmons First National Corporation SFNC
Consolidated End of Period Balance Sheets
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
(in thousands)
ASSETS
Cash and non-interest bearing balances due from banks $ 108,424 $ 54,347 $ 73,554 $ 44,805 $ 48,018
Interest bearing balances due from banks 423,986 281,562 210,742 377,855 474,118
Federal funds sold 178,418 -- 10,000 -- --
Cash and cash equivalents 710,828 335,909 294,296 422,660 522,136
Investment securities - held-to-maturity 758,682 777,587 822,730 799,963 776,615
Investment securities - available-for-sale 851,124 305,283 317,473 270,336 264,974
Mortgage loans held for sale 25,513 21,265 22,003 20,409 16,717
Assets held in trading accounts 6,528 6,987 6,819 6,881 6,865
Loans:
Legacy loans 2,115,380 2,053,721 1,963,378 1,868,842 1,779,609
Allowance for loan losses (29,183) (29,028) (27,076) (27,530) (26,983)
Loans acquired, not covered by FDIC loss share
(net of discount) 2,418,440 575,980 676,056 398,967 450,289
Loans acquired, covered by FDIC loss share
(net of discount and allowance) 102,468 106,933 118,158 121,524 137,879
Net loans 4,607,105 2,707,606 2,730,516 2,361,803 2,340,794
FDIC indemnification asset 15,965 22,663 25,694 30,508 39,239
Premises and equipment 200,091 122,966 115,639 113,541 111,888
Premises held for sale -- 6,126 15,856 14,145 23,779
Foreclosed assets not covered by FDIC loss share 50,723 44,856 50,770 53,342 57,476
Foreclosed assets covered by FDIC loss share 12,010 11,793 15,212 16,951 18,171
Interest receivable 24,719 16,774 18,006 14,254 15,102
Bank owned life insurance 117,296 77,592 75,357 61,115 60,714
Goodwill 314,643 108,095 108,095 78,529 78,529
Other intangible assets 47,887 22,526 22,988 14,094 14,519
Other assets 74,710 55,326 49,768 47,310 49,129
Total assets $ 7,817,824 $ 4,643,354 $ 4,691,222 $ 4,325,841 $ 4,396,647
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing transaction accounts $ 1,123,966 $ 889,260 $ 884,064 $ 838,543 $ 838,050
Interest bearing transaction accounts and savings deposits 3,627,870 2,006,271 1,984,422 1,784,040 1,793,330
Time deposits less than $100,000 1,058,602 530,890 565,957 559,597 589,798
Time deposits greater than $100,000 464,270 434,297 474,472 459,545 485,870
Total deposits 6,274,708 3,860,718 3,908,915 3,641,725 3,707,048
Federal funds purchased and securities sold under agreements to repurchase 111,484 110,586 112,977 98,226 104,643
Other borrowings 285,060 114,682 123,396 115,602 116,970
Subordinated debentures 62,994 20,620 20,620 20,620 20,620
Accrued interest and other liabilities 69,841 42,429 41,309 35,533 40,694
Total liabilities 6,804,087 4,149,035 4,207,217 3,911,706 3,989,975
Stockholders' equity:
Preferred stock 30,852 -- -- -- --
Common stock 299 181 180 163 163
Surplus 444,366 156,568 155,592 90,010 89,274
Undivided profits 536,365 338,906 330,185 325,371 319,354
Accumulated other comprehensive income (loss)
Unrealized appreciation (depreciation) on AFS securities 1,855 (1,336) (1,952) (1,409) (2,119)
Total stockholders' equity 1,013,737 494,319 484,005 414,135 406,672
Total liabilities and stockholders' equity $ 7,817,824 $ 4,643,354 $ 4,691,222 $ 4,325,841 $ 4,396,647
Simmons First National Corporation SFNC
Consolidated Average Quarter-to-Date Balance Sheets
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
(in thousands)
ASSETS
Cash and non-interest bearing balances due from banks $ 68,322 $ 54,485 $ 50,980 $ 44,671 $ 68,770
Interest bearing balances due from banks 371,195 299,054 288,258 456,931 507,936
Federal funds sold 56,846 6,486 6,794 985 385
Cash and cash equivalents 496,363 360,025 346,032 502,587 577,091
Investment securities - held-to-maturity 771,664 806,069 810,085 782,900 749,126
Investment securities - available-for-sale 513,843 318,879 300,927 265,194 223,203
Mortgage loans held for sale 14,655 17,241 24,942 15,299 6,668
Assets held in trading accounts 6,782 6,848 6,841 6,850 7,212
Loans:
Legacy loans 2,084,551 2,008,550 1,917,155 1,817,429 1,719,294
Allowance for loan losses (30,072) (28,474) (27,470) (27,287) (27,771)
Loans acquired, not covered by FDIC loss share
(net of discount) 1,197,601 620,505 481,658 418,515 505,031
Loans acquired, covered by FDIC loss share
(net of discount and allowance) 104,701 111,618 119,372 128,099 142,777
Net loans 3,356,781 2,712,199 2,490,715 2,336,756 2,339,331
FDIC indemnification asset 21,515 24,457 28,311 35,940 46,154
Premises and equipment 150,564 117,018 115,577 112,994 119,626
Premises held for sale 6,126 6,794 12,521 21,142 19,514
Foreclosed assets not covered by FDIC loss share 44,059 48,745 51,097 55,304 63,453
Foreclosed assets covered by FDIC loss share 11,902 13,964 16,073 18,330 19,901
Interest receivable 19,181 17,738 15,743 15,076 14,882
Bank owned life insurance 91,760 76,578 63,798 60,895 60,552
Goodwill 175,901 109,837 88,590 78,529 78,901
Other intangible assets 31,102 17,748 15,321 14,299 14,765
Other assets 58,536 50,566 52,234 48,583 45,458
Total assets $ 5,770,734 $ 4,704,706 $ 4,438,807 $ 4,370,678 $ 4,385,837
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing transaction accounts $ 946,979 $ 895,470 $ 828,340 $ 823,552 $ 735,101
Interest bearing transaction accounts and savings deposits 2,601,046 2,010,827 1,869,095 1,810,436 1,854,510
Time deposits less than $100,000 715,710 545,986 555,837 577,856 601,046
Time deposits greater than $100,000 438,782 458,117 457,489 472,009 495,574
Total deposits 4,702,517 3,910,400 3,710,761 3,683,853 3,686,231
Federal funds purchased and securities sold under agreements to repurchase 121,568 117,661 108,357 101,537 115,018
Other borrowings 183,953 121,691 117,664 116,082 117,588
Subordinated debentures 35,686 20,620 20,620 20,620 20,620
Accrued interest and other liabilities 43,825 38,869 38,950 34,637 36,967
Total liabilities 5,087,549 4,209,241 3,996,352 3,956,729 3,976,424
Total stockholders' equity 683,185 495,465 442,455 413,949 409,413
Total liabilities and stockholders' equity $ 5,770,734 $ 4,704,706 $ 4,438,807 $ 4,370,678 $ 4,385,837
Simmons First National Corporation SFNC
Consolidated Statements of Income - Quarter-to-Date
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
(in thousands, except per share data)
INTEREST INCOME
Loans $ 50,986 $ 45,248 $ 40,082 $ 38,622 $ 40,131
Federal funds sold 29 13 12 2 1
Investment securities 5,879 5,325 4,717 4,766 4,549
Mortgage loans held for sale 148 188 269 168 69
Assets held in trading accounts 3 4 3 5 5
Interest bearing balances due from banks 210 167 132 279 279
TOTAL INTEREST INCOME 57,255 50,945 45,215 43,842 45,034
INTEREST EXPENSE
Time deposits 1,596 1,470 1,461 1,515 1,577
Other deposits 1,348 872 771 720 692
Federal funds purchased and securities sold under agreements to repurchase 64 61 55 31 53
Other borrowings 1,051 992 996 988 1,010
Subordinated debentures 234 160 160 160 157
TOTAL INTEREST EXPENSE 4,293 3,555 3,443 3,414 3,489
NET INTEREST INCOME 52,962 47,390 41,772 40,428 41,545
Provision for loan losses 1,171 3,607 1,128 1,602 908
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 51,791 43,783 40,644 38,826 40,637
NON-INTEREST INCOME
Trust income 2,251 2,182 1,838 1,553 1,537
Service charges on deposit accounts 6,363 6,552 6,238 6,792 6,068
Other service charges and fees 1,827 1,083 808 859 823
Mortgage lending income 2,262 1,457 1,812 1,262 810
Investment banking income 894 451 284 154 181
Credit card fees 5,648 5,653 5,769 5,801 5,643
Bank owned life insurance income 572 727 411 377 330
Gain on sale of securities, net (38) (12) (18) 38 --
Net (loss) gain on assets covered by FDIC loss share agreements (2,671) (3,013) (3,744) (6,268) (7,370)
Other income 1,390 6,424 2,637 4,820 1,176
TOTAL NON-INTEREST INCOME 18,498 21,504 16,035 15,388 9,198
NON-INTEREST EXPENSE
Salaries and employee benefits 26,771 25,126 20,892 20,982 22,464
Occupancy expense, net 3,557 2,494 3,204 3,285 3,890
Furniture and equipment expense 3,268 2,732 2,363 2,215 2,014
Other real estate and foreclosure expense 381 1,395 1,864 375 873
Deposit insurance 870 724 877 1,085 668
Merger related costs 10,419 1,214 3,628 1,354 1,272
Other operating expenses 12,106 13,294 11,526 10,546 13,370
TOTAL NON-INTEREST EXPENSE 57,372 46,979 44,354 39,842 44,551
NET INCOME BEFORE INCOME TAXES 12,917 18,308 12,325 14,372 5,284
Provision for income taxes 4,182 5,669 3,537 4,464 932
NET INCOME 8,735 12,639 8,788 9,908 4,352
Preferred stock dividends 26 -- -- -- --
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $ 8,709 $ 12,639 $ 8,788 $ 9,908 $ 4,352
BASIC EARNINGS PER SHARE $ 0.39 $ 0.72 $ 0.52 $ 0.61 $ 0.27
DILUTED EARNINGS PER SHARE $ 0.39 $ 0.72 $ 0.52 $ 0.60 $ 0.27
Simmons First National Corporation SFNC
Consolidated Risk-Based Capital
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
($ in thousands)
Tier 1 capital
Stockholders' equity $ 1,013,737 $ 494,319 $ 482,642 $ 414,135 $ 406,672
Trust preferred securities, net allowable 61,410 20,000 20,000 20,000 20,000
Disallowed intangible assets, net of deferred tax (344,140) (112,545) (109,698) (74,003) (74,477)
Unrealized (gain) loss on AFS securities (1,855) 1,336 1,952 1,409 2,119
Other (4,789) -- -- -- --
Total Tier 1 capital 724,363 403,110 394,896 361,541 354,314
Tier 2 capital
Qualifying unrealized gain on AFS equity securities -- 2 -- 47 42
Qualifying allowance for loan losses and reserve for unfunded commitments 32,600 32,073 29,167 29,621 28,846
Total Tier 2 capital 32,600 32,075 29,167 29,668 28,888
Total risk-based capital $ 756,963 $ 435,185 $ 424,063 $ 391,209 $ 383,202
Common equity
Tier 1 capital $ 724,363
Less: Non-cumulative preferred stock (30,852)
Less: Trust preferred securities (61,410)
Total common equity $ 632,101
Risk weighted assets $ 4,659,065 $ 3,002,270 $ 3,063,801 $ 2,652,474 $ 2,651,970
Adjusted average assets for leverage ratio $ 5,428,706 $ 4,593,924 $ 4,331,488 $ 4,299,379 $ 4,315,279
Ratios at end of quarter
Equity to assets 12.97% 10.65% 10.29% 9.57% 9.25%
Tangible common equity to tangible assets 8.32% 8.06% 7.78% 7.59% 7.29%
Common equity Tier 1 ratio (CET1) 13.57%
Tier 1 leverage ratio 13.34% 8.77% 9.12% 8.41% 8.21%
Tier 1 risk-based capital ratio 15.55% 13.43% 12.89% 13.63% 13.36%
Total risk-based capital ratio 16.25% 14.50% 13.84% 14.75% 14.45%
Simmons First National Corporation SFNC
Consolidated Loans and Investments
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
(in thousands)
Legacy Loan Portfolio - End of Period (1)
Consumer
Credit cards $ 171,413 $ 185,380 $ 175,822 $ 176,239 $ 172,609
Student loans -- -- -- 398 24,415
Other consumer 107,486 103,402 105,508 105,998 104,185
Total consumer 278,899 288,782 281,330 282,635 301,209
Real Estate
Construction 178,929 181,968 163,364 163,412 168,147
Single-family residential 467,671 455,563 436,925 417,187 402,588
Other commercial 755,701 714,797 681,848 653,734 644,772
Total real estate 1,402,301 1,352,328 1,282,137 1,234,333 1,215,507
Commercial
Commercial 324,815 291,820 249,186 233,510 186,303
Agricultural 105,228 115,658 145,157 111,567 72,239
Total commercial 430,043 407,478 394,343 345,077 258,542
Other 4,137 5,133 5,568 6,796 4,351
Total Loans $ 2,115,380 $ 2,053,721 $ 1,963,378 $ 1,868,841 $ 1,779,609
(1) Excludes all acquired loans, including those covered by FDIC loss share agreements.
Investment Securities - End of Period
Held-to-Maturity
U.S. Government agencies $ 390,625 $ 418,914 $ 455,827 $ 449,201 $ 425,616
Mortgage-backed securities 28,535 29,743 30,954 32,204 33,323
State and political subdivisions 338,575 328,310 335,329 317,938 317,056
Other securities 947 620 620 620 620
Total held-to-maturity 758,682 777,587 822,730 799,963 776,615
Available-for-Sale
U.S. Treasury $ 4,008 $ 3,992 $ 3,991 $ 3,994 $ 3,981
U.S. Government agencies 346,315 272,816 280,321 238,411 231,949
Mortgage-backed securities 312,011 1,572 32 1,958 1,833
State and political subdivisions 157,193 6,540 8,903 6,920 7,367
FHLB stock 15,256 5,126 5,623 4,966 5,168
Other securities 16,341 15,237 18,603 14,087 14,676
Total available-for-sale 851,124 305,283 317,473 270,336 264,974
Total investment securities $ 1,609,806 $ 1,082,870 $ 1,140,203 $ 1,070,299 $ 1,041,589
Investment Securities - QTD Average
Taxable securities $ 893,946 $ 782,062 $ 781,685 $ 722,084 $ 649,329
Tax exempt securities 391,561 342,886 329,327 326,010 323,000
Total investment securities - QTD average $ 1,285,507 $ 1,124,948 $ 1,111,012 $ 1,048,094 $ 972,329
Simmons First National Corporation SFNC
Consolidated Loans and Credit Coverage
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
($ in thousands)
LOANS
Legacy loans $ 2,115,380 $ 2,053,721 $ 1,963,378 $ 1,868,841 $ 1,779,609
Allowance for loan losses (legacy loans) (29,183) (29,028) (27,076) (27,530) (26,983)
Legacy loans (net of allowance) 2,086,197 2,024,693 1,936,302 1,841,311 1,752,626
Loans acquired, not covered by FDIC loss share 2,491,316 621,020 733,914 445,515 495,915
Credit discount (72,876) (45,040) (57,858) (46,548) (45,626)
Loans acquired, not covered (net of discount) 2,418,440 575,980 676,056 398,967 450,289
Loans acquired, covered by FDIC loss share 126,629 140,038 154,183 163,775 188,755
Credit discount (23,207) (32,151) (36,025) (42,251) (50,876)
Allowance for loan losses (acquired covered loans) (954) (954) -- -- --
Loans acquired, covered (net of discount and allowance) 102,468 106,933 118,158 121,524 137,879
Net loans $ 4,607,105 $ 2,707,606 $ 2,730,516 $ 2,361,802 $ 2,340,794
Loan Coverage Ratios
Allowance for loan losses to legacy loans 1.38% 1.41% 1.38% 1.47% 1.52%
Discount for credit losses on loans acquired, not covered, to total loans acquired, not covered, plus discount for credit losses on loans acquired, not covered 2.93% 7.25% 7.88% 10.45% 9.20%
Discount for credit losses on loans acquired, covered, to total loans acquired, covered, plus discount for credit losses on loans acquired, covered 19.08% 23.64% 23.37% 25.80% 26.95%
Total allowance and credit coverage 2.67% 3.81% 4.24% 4.69% 5.01%
Simmons First National Corporation SFNC
Consolidated Allowance and Asset Quality
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
($ in thousands)
Allowance for Loan Losses (Legacy Loans)
Balance, beginning of quarter $ 29,028 $ 27,076 $ 27,530 $ 26,983 $ 27,442
Loans charged off
Credit cards 785 859 788 725 816
Other consumer 220 781 648 426 148
Real estate 293 200 534 1,144 1,035
Commercial 245 310 474 186 82
Total loans charged off 1,543 2,150 2,444 2,481 2,081
Recoveries of loans previously charged off
Credit cards 213 220 190 215 271
Other consumer 133 94 122 133 121
Real estate 12 56 379 1,062 308
Commercial 169 125 171 16 14
Total recoveries 527 495 862 1,426 714
Net loans charged off 1,016 1,655 1,582 1,055 1,367
Provision for loan losses 1,171 3,607 1,128 1,602 908
Balance, end of quarter $ 29,183 $ 29,028 $ 27,076 $ 27,530 $ 26,983
Non-performing assets (1) (2)
Non-performing loans
Nonaccrual loans
Real estate $ 12,460 $ 10,152 $ 9,374 $ 8,166 $ 8,075
Commercial 1,650 1,481 1,174 1,110 1,054
Consumer 401 405 664 877 883
Total nonaccrual loans 14,511 12,038 11,212 10,153 10,012
Loans past due 90 days or more
Government guaranteed student loans -- -- -- 323 1,965
Other loans 498 961 713 757 517
Total loans past due 90 days or more 498 961 713 1,080 2,482
Total non-performing loans 15,009 12,999 11,925 11,233 12,494
Other non-performing assets
Foreclosed assets held for sale 19,644 11,803 13,167 16,745 17,357
Acquired foreclosed assets held for sale, not covered by FDIC loss share agreements 31,079 33,053 37,603 36,597 40,119
Other non-performing assets 215 97 72 80 60
Total other non-performing assets 50,938 44,953 50,842 53,422 57,536
Total non-performing assets $ 65,947 $ 57,952 $ 62,767 $ 64,655 $ 70,030
Performing TDRs (troubled debt restructurings) $ 2,227 $ 2,233 $ 2,234 $ 2,776 $ 8,655
Ratios (1) (2)
Allowance for loan losses to total loans 1.38% 1.41% 1.38% 1.47% 1.52%
Allowance for loan losses to non-performing loans 194% 223% 227% 245% 216%
Non-performing loans to total loans 0.71% 0.63% 0.61% 0.60% 0.70%
Non-performing assets (including performing TDRs) to total assets 0.87% 1.30% 1.39% 1.56% 1.79%
Non-performing assets to total assets 0.84% 1.25% 1.34% 1.49% 1.59%
Non-performing assets to total assets
(excluding Gov't guaranteed student loans) 0.84% 1.25% 1.34% 1.49% 1.55%
Annualized net charge offs to total loans 0.20% 0.33% 0.33% 0.23% 0.32%
Annualized net credit card charge offs to total credit card loans 1.32% 1.41% 1.31% 1.14% 1.20%
Annualized net charge offs to total loans
(excluding credit cards) 0.09% 0.22% 0.22% 0.13% 0.22%
Past due loans >30 days (excluding nonaccrual) 0.37% 0.48% 0.33% 0.34% 0.61%
Past due loans >30 days (excluding nonaccrual)
(excluding Gov't guaranteed student loans) 0.37% 0.48% 0.33% 0.32% 0.45%
(1) Excludes all acquired loans, including those covered by FDIC loss share agreements, except for their inclusion in total assets.
(2) Excludes acquired foreclosed assets covered by FDIC loss share agreements, except for their inclusion in total assets.
Simmons First National Corporation SFNC
Consolidated - Net Interest Income Analysis
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
ASSETS
Earning Assets
Interest bearing balances due from banks 0.23% 0.22% 0.18% 0.24% 0.22%
Investment securities 2.44% 2.49% 2.29% 2.47% 2.60%
Mortgage loans held for sale 4.10% 4.33% 4.28% 4.40% 4.20%
Assets held in trading accounts 0.18% 0.23% 0.17% 0.29% 0.28%
Loans, including acquired loans 6.11% 6.55% 6.32% 6.55% 6.88%
Total interest earning assets 4.68% 4.98% 4.71% 4.69% 4.91%
LIABILITIES
Interest bearing liabilities
Interest bearing transaction and savings accounts 0.21% 0.17% 0.16% 0.16% 0.15%
Time deposits 0.56% 0.58% 0.57% 0.58% 0.58%
Total interest bearing deposits 0.32% 0.31% 0.31% 0.31% 0.31%
Federal funds purchased and securities sold under agreement to repurchase 0.21% 0.21% 0.20% 0.12% 0.19%
Other borrowings 2.32% 3.23% 3.36% 3.41% 3.48%
Subordinated debentures 2.66% 3.08% 3.08% 3.11% 3.09%
Total interest bearing liabilities 0.42% 0.43% 0.44% 0.44% 0.44%
NET INTEREST MARGIN/SPREAD
Net interest spread 4.26% 4.55% 4.27% 4.25% 4.47%
Net interest margin - quarter-to-date 4.34% 4.65% 4.36% 4.34% 4.54%
Net interest margin - year-to-date 4.34% 4.47% 4.41% 4.44% 4.54%
Simmons First National Corporation SFNC
Consolidated - Selected Financial Data
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
($ in thousands, except share data)
QUARTER-TO-DATE
Diluted earnings per share $ 0.39 $ 0.72 $ 0.52 $ 0.60 $ 0.27
Core earnings (excludes nonrecurring items) (non-GAAP) 15,700 11,387 10,684 9,153 7,482
Diluted core earnings per share (non-GAAP) 0.70 0.64 0.63 0.56 0.46
Cash dividends declared per common share 0.23 0.22 0.22 0.22 0.22
Cash dividends declared - amount 6,864 3,965 3,954 3,589 3,575
Return on average stockholders' equity 5.17% 10.12% 7.88% 9.60% 4.31%
Return on tangible equity 7.88% 14.00% 10.62% 12.72% 5.94%
Return on average assets 0.61% 1.07% 0.79% 0.91% 0.40%
Net interest margin (FTE) 4.34% 4.65% 4.36% 4.34% 4.54%
Core efficiency ratio (non-GAAP) 62.24% 64.32% 64.89% 68.15% 72.61%
FTE adjustment - investments 1,846 1,744 1,695 1,687 1,682
FTE adjustment - loans 11 7 7 8 10
Amortization of intangibles 899 565 454 452 453
Amortization of intangibles, net of taxes 546 343 276 275 275
Average shares outstanding 22,258,221 18,031,669 16,873,504 16,318,003 16,270,149
Average earning assets 5,121,838 4,195,250 3,956,032 3,892,202 3,861,632
Average interest bearing liabilities 4,096,745 3,274,902 3,129,062 3,098,540 3,204,356
YEAR-TO-DATE
Diluted earnings per share $ 0.39 $ 2.11 $ 1.39 $ 0.87 $ 0.27
Core earnings (excludes nonrecurring items) (non-GAAP) 15,700 38,706 27,319 16,635 7,482
Diluted core earnings per share (non-GAAP) 0.70 2.29 1.65 1.02 0.46
Cash dividends declared per common share 0.23 0.88 0.66 0.44 0.22
Cash dividends declared - amount 6,864 15,083 11,118 7,164 3,575
Return on average stockholders' equity 5.17% 8.11% 7.30% 6.95% 4.31%
Return on tangible equity 7.88% 10.99% 9.82% 9.33% 5.94%
Return on average assets 0.61% 0.80% 0.70% 0.65% 0.40%
Net interest margin (FTE) 4.34% 4.47% 4.41% 4.44% 4.54%
Core efficiency ratio (non-GAAP) 62.24% 67.22% 68.41% 70.35% 72.61%
FTE adjustment - investments 1,846 6,808 5,064 3,369 1,682
FTE adjustment - loans 11 32 25 18 10
Amortization of intangibles 899 1,979 1,359 905 453
Amortization of intangibles, net of taxes 546 1,203 826 550 275
Average shares outstanding 22,258,221 16,878,766 16,489,429 16,294,208 16,270,149
Average diluted shares outstanding 22,350,272 16,922,026 16,532,689 16,336,901 16,309,868
Average earning assets 5,121,838 3,975,903 3,903,290 3,876,918 3,861,632
Average interest bearing liabilities 4,096,745 3,176,716 3,143,984 3,151,446 3,204,356
END OF PERIOD
Book value per share $ 33.96 $ 27.38 $ 26.82 $ 25.36 $ 24.93
Tangible book value per share 21.82 20.15 19.72 19.69 19.23
Shares outstanding 29,850,034 18,052,488 17,992,261 16,331,341 16,311,263
Full-time equivalent employees 2,076 1,338 1,397 1,281 1,321
Total number of financial centers 164 109 113 104 104
Parent company only - investment in subsidiaries 1,032,444 522,841 516,801 449,591 453,067
Parent company only - intangible assets 133 133 133 133 133
Simmons First National Corporation SFNC
Consolidated - Reconciliation of Core Earnings (non-GAAP)
For the Quarters Ended Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(Unaudited) 2015 2014 2014 2014 2014
(in thousands, except per share data)
QUARTER-TO-DATE
Net Income $ 8,709 $ 12,639 $ 8,788 $ 9,908 $ 4,352
Nonrecurring items
Gain on sale of merchant services -- -- -- (1,000) --
Merger related costs 10,419 1,218 3,628 1,354 1,272
Change-in-control payments -- 885
Branch right sizing 35 (4,221) (705) (2,011) 3,878
Charter consolidation costs -- 42 196 414 --
Tax effect (1) (3,463) 824 (1,223) 488 (2,020)
Net nonrecurring items 6,991 (1,252) 1,896 (755) 3,130
Core earnings (non-GAAP) $ 15,700 $ 11,387 $ 10,684 $ 9,153 $ 7,482
Diluted earnings per share $ 0.39 $ 0.72 $ 0.52 $ 0.60 $ 0.27
Nonrecurring items
Gain on sale of merchant services -- -- -- (0.06) --
Merger related costs 0.47 0.07 0.21 0.08 0.08
Change-in-control payments -- 0.05
Branch right sizing -- (0.24) (0.04) (0.12) 0.24
Charter consolidation costs -- -- 0.01 0.03 --
Tax effect (1) (0.16) 0.04 (0.07) 0.03 (0.13)
Net nonrecurring items 0.31 (0.08) 0.11 (0.04) 0.19
Diluted core earnings per share (non-GAAP) $ 0.70 $ 0.64 $ 0.63 $ 0.56 $ 0.46
YEAR-TO-DATE
Net Income $ 8,709 $ 35,687 $ 23,049 $ 14,261 $ 4,352
Nonrecurring items
Gain on sale of merchant services -- (1,000) (1,000) (1,000) --
Merger related costs 10,419 7,472 6,254 2,626 1,272
Change-in-control payments -- 885
Branch right sizing 35 (3,059) 1,162 1,867 3,878
Charter consolidation costs -- 652 610 414 --
Tax effect (1) (3,463) (1,931) (2,745) (1,533) (2,020)
Net nonrecurring items 6,991 3,019 4,281 2,374 3,130
Core earnings (non-GAAP) $ 15,700 $ 38,706 $ 27,330 $ 16,635 $ 7,482
Diluted earnings per share $ 0.39 $ 2.11 $ 1.39 $ 0.87 $ 0.27
Nonrecurring items
Gain on sale of merchant services -- (0.06) (0.06) (0.06) --
Merger related costs 0.47 0.44 0.37 0.16 0.08
Change-in-control payments -- 0.05
Branch right sizing -- (0.16) 0.08 0.12 0.24
Charter consolidation costs -- 0.04 0.04 0.03 --
Tax effect (1) (0.16) (0.13) (0.17) (0.10) (0.13)
Net nonrecurring items 0.31 0.18 0.26 0.15 0.19
Diluted core earnings per share (non-GAAP) $ 0.70 $ 2.29 $ 1.65 $ 1.02 $ 0.46
(1) Effective tax rate of 39.225%, adjusted for non-deductible merger related costs.

CONTACT: DAVID W. GARNER Executive Vice President and Investor Relations Officer Simmons First National Corporation (870) 541-1000

Source:Simmons First National Corporation