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Triumph Bancorp Reports Third Quarter Net Income to Common Stockholders of $4.5 Million

DALLAS, Oct. 26, 2016 (GLOBE NEWSWIRE) -- Triumph Bancorp, Inc. (NASDAQ:TBK) today announced earnings and operating results for the third quarter of 2016.

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

2016 Third Quarter Highlights

  • For the third quarter of 2016, net income was $4.8 million and net income available to common stockholders was $4.5 million, compared to net income of $4.6 million and net income available to common stockholders of $4.4 million for the quarter ended June 30, 2016.
  • Diluted earnings per share were $0.25 for the quarter ended September 30, 2016, compared to $0.25 for the quarter ended June 30, 2016. Adjusted diluted earnings per share, which exclude acquisition-related costs, were $0.32 for the quarter ended September 30, 2016.
  • For the quarter ended September 30, 2016, our annualized return on average common equity and return on average assets were 6.51% and 0.84%, respectively, compared to an annualized return on average common equity and return on average assets of 6.64% and 1.07%, respectively, for the quarter ended June 30, 2016. Our ratio of tangible common stockholders’ equity to tangible assets was 8.99% as of September 30, 2016.
  • Net interest margin (“NIM”) was 5.79% for the quarter ended September 30, 2016, compared to 6.53% for the quarter ended June 30, 2016.
  • Total loans held for investment increased $549.3 million or 38.9% to $1.960 billion at September 30, 2016.
  • Closed our previously announced acquisition of ColoEast Bankshares, Inc. (“ColoEast”) and its wholly owned bank subsidiary, Colorado East Bank & Trust, on August 1, 2016.
  • Completed a $50 million subordinated debt offering enhancing our regulatory capital position.

Balance Sheet

Average loans outstanding for the third quarter of 2016 were $1.724 billion, an increase of $437.7 million, or 34.0%, from the average balance for the quarter ended June 30, 2016. Total loans held for investment were $1.960 billion at September 30, 2016, an increase of $549.3 million or 38.9% from $1.411 billion at June 30, 2016. We acquired loans with an acquisition date fair value of $460.8 million in the ColoEast transaction. Our commercial finance loan portfolio totaled $637.9 million as of September 30, 2016, an increase of $31.0 million or 5.1% in the third quarter.

The third quarter increase in our commercial finance loan portfolio was partially offset by a $23.6 million reduction in factored receivables outstanding during the period. This reduction was due to a one-time acceleration of factored invoice collections upon our implementation of a new payment processing initiative.

Total deposits were $1.951 billion at September 30, 2016, an increase of $675.5 million or 53.0% for the third quarter of 2016. Non-interest-bearing deposits accounted for 17% of total deposits and non-time deposits accounted for 53% of total deposits. The average cost of our total funds was 0.61% for the quarter ended September 30, 2016 compared to 0.68% for the quarter ended June 30, 2016, on an annualized basis. We assumed $653.0 million of deposits in the ColoEast transaction.

Net Interest Income

We earned net interest income for the quarter ended September 30, 2016 of $30.4 million compared to $25.9 million for the quarter ended June 30, 2016. Yields on loans for the quarter ended September 30, 2016 were down 108 bps from the prior quarter to 7.42% (down 71 bps from the prior quarter to 7.10% adjusted to exclude loan discount accretion). NIM adjusted to exclude loan discount accretion was 5.53% for the quarter ended September 30, 2016 compared to 5.98% for the quarter ended June 30, 2016. Yields on loans and NIM for the quarter ended September 30, 2016 were impacted by the acquisition of ColoEast, which created a shift in our loan mix. At September 30, 2016, 33% of our loans were comprised of our higher-yielding commercial finance products, compared to 43% at June 30, 2016.

Asset Quality

Non-performing assets increased 45 bps from June 30, 2016 to September 30, 2016 to 2.05% of total assets. This increase included $7.4 million of nonaccrual loans and $3.1 million of OREO acquired in the ColoEast acquisition, which were recorded at their respective fair values on the acquisition date. The remaining increase was primarily due to three loan relationships, including troubled debt restructurings during the quarter ended September 30, 2016. These same loan relationships also contributed to the ratio of past due to total loans, which increased to 3.86% at September 30, 2016 from 2.80% at June 30, 2016. In addition, our past due loans at September 30, 2016 included $19.2 million of delinquent loans acquired in the ColoEast acquisition. We recorded net charge-offs of $1.68 million for the quarter ended September 30, 2016 compared to net charge-offs of $0.26 million for the quarter ended June 30, 2016. The increase in net charge-offs was primarily due to a $1.4 million loan relationship charged-off during the third quarter of 2016. We recorded a provision for loan losses of $2.8 million for the quarter ended September 30, 2016 compared to a provision of $1.9 million for the quarter ended June 30, 2016. From June 30, 2016 to September 30, 2016, our allowance for loan and lease losses (“ALLL”) increased from $13.8 million or 0.98% of total loans to $14.9 million or 0.76% of total loans. The ALLL ratio was impacted by the acquired ColoEast loan portfolio during the period which was recorded at fair value on the acquisition date and did not require an ALLL.

Non-interest Income and Expense

We earned non-interest income for the quarter ended September 30, 2016 of $6.1 million compared to $3.7 million for the quarter ended June 30, 2016. Non-interest income for the prior quarter ended June 30, 2016 was reduced by a $1.2 million OREO write-down related to a bank facility previously transferred to OREO that is no longer being actively operated. Non-interest income for the quarter ended September 30, 2016 includes the operations of ColoEast subsequent to the August 1, 2016 acquisition date.

For the quarter ended September 30, 2016, non-interest expense totaled $25.8 million, compared to $20.3 million for the quarter ended June 30, 2016. Non-interest expense for the quarter ended September 30, 2016 was increased by $1.6 million of acquisition costs associated with the ColoEast transaction. Non-interest expense for the quarter ended September 30, 2016 includes the operations of ColoEast subsequent to the August 1, 2016 acquisition date.

Conference Call Information

Aaron P. Graft, Vice Chairman and CEO and Bryce Fowler, CFO will review the quarterly results in a conference call for investors and analysts beginning at 8:30 a.m. Central Time on Thursday, October 27, 2016. Dan Karas, Chief Lending Officer, will also be available for questions.

To participate in the live conference call, please dial 1 (855) 779-1042 (U.S. and Canada) and enter Conference ID # 94147204. A simultaneous audio-only webcast may be accessed via our website at www.triumphbancorp.com through the Investor Relations, Webcasts and Presentations links, or through a direct link here at http://edge.media-server.com/m/p/t6qdamxr. An archive of this conference call will subsequently be available at this same location on our website.

About Triumph

Headquartered in Dallas, Texas, Triumph Bancorp, Inc. (NASDAQ:TBK) is a financial holding company with a diversified line of community banking, commercial finance and asset management activities. www.triumphbancorp.com

Forward-Looking Statements

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

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 26, 2016.

Non-GAAP Financial Measures

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

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

As of and for the Three Months Ended
September 30, June 30, March 31, December 31, September 30,
2016 2016 2016 2015 2015
Financial Highlights (Dollars in thousands):
Total assets $2,575,490 $1,783,395 $1,687,795 $1,691,313 $1,581,463
Loans held for investment $1,959,855 $1,410,518 $1,245,840 $1,291,885 $1,185,301
Deposits $1,950,677 $1,275,154 $1,260,393 $1,248,950 $1,200,036
Net income available to common stockholders $4,506 $4,431 $4,812 $4,312 $5,732
Performance Ratios - Annualized:
Return on average assets 0.84% 1.07% 1.20% 1.10% 1.50%
Return on average total equity 6.63% 6.69% 7.39% 6.68% 8.96%
Return on average common equity (1) 6.51% 6.64% 7.37% 6.63% 9.00%
Return on average tangible common equity (1) 7.60% 7.37% 8.23% 7.45% 10.20%
Yield on loans 7.42% 8.50% 7.84% 8.17% 8.34%
Adjusted yield on loans (1) 7.10% 7.81% 7.47% 7.84% 7.96%
Cost of interest bearing deposits 0.68% 0.72% 0.74% 0.71% 0.69%
Cost of total deposits 0.57% 0.63% 0.64% 0.61% 0.59%
Cost of total funds 0.61% 0.68% 0.69% 0.66% 0.64%
Net interest margin 5.79% 6.53% 5.90% 6.20% 6.45%
Adjusted net interest margin (1) 5.53% 5.98% 5.61% 5.94% 6.14%
Net non-interest expense to average assets (1)(2) 3.15% 3.85% 3.61% 3.96% 4.04%
Efficiency ratio (1)(2) 66.20% 68.74% 73.09% 75.40% 73.85%
Asset Quality:(3)
Past due to total loans 3.86% 2.80% 3.61% 2.41% 2.14%
Non-performing loans to total loans 2.25% 1.56% 1.70% 1.03% 0.97%
Non-performing assets to total assets 2.05% 1.60% 1.72% 1.10% 1.12%
ALLL to non-performing loans 33.78% 62.60% 56.96% 94.10% 100.00%
ALLL to total loans 0.76% 0.98% 0.97% 0.97% 0.97%
Net charge-offs to average loans 0.10% 0.02% 0.00% 0.01% 0.01%
Capital:
Tier 1 capital to average assets(4) 12.04% 16.02% 16.24% 16.56% 16.87%
Tier 1 capital to risk-weighted assets(4) 11.96% 17.14% 18.79% 18.23% 19.34%
Common equity tier 1 capital to risk-weighted assets(4) 10.26% 15.19% 16.62% 16.23% 17.18%
Total capital to risk-weighted assets(4) 14.80% 18.01% 19.65% 19.11% 20.21%
Total equity to total assets 11.05% 15.69% 16.24% 15.85% 16.69%
Tangible common stockholders' equity to tangible assets 8.99% 13.88% 14.30% 13.85% 14.50%
Per Share Amounts:
Book value per share $15.18 $14.91 $14.67 $14.34 $14.09
Tangible book value per share (1) $12.55 $13.47 $13.18 $12.79 $12.48
Basic earnings per common share $0.25 $0.25 $0.27 $0.24 $0.32
Diluted earnings per common share $0.25 $0.25 $0.27 $0.24 $0.32
Adjusted diluted earnings per common share(1)(2) $0.32 $0.25 $0.27 $0.19 $0.22
Shares outstanding end of period 18,106,978 18,107,493 18,015,423 18,018,200 18,040,072


Unaudited consolidated balance sheet as of:

September 30, June 30, March 31, December 31, September 30,
(Dollars in thousands) 2016 2016 2016 2015 2015
ASSETS
Total cash and cash equivalents $104,725 $61,750 $123,715 $105,277 $115,783
Securities - available for sale 286,574 159,790 161,517 163,169 156,820
Securities - held to maturity 29,316 27,502 25,796 747
Loans held for sale 9,623 3,043 1,341 2,174
Loans held for investment 1,959,855 1,410,518 1,245,840 1,291,885 1,185,301
Allowance for loan and lease losses (14,912) (13,772) (12,093) (12,567) (11,544)
Loans, net 1,944,943 1,396,746 1,233,747 1,279,318 1,173,757
FHLB and FRB stock 8,397 6,368 4,234 3,818 7,992
Premises and equipment, net 45,050 19,629 19,934 22,227 21,807
Other real estate owned ("OREO"), net 8,061 6,074 7,478 5,177 6,201
Goodwill and intangible assets, net 47,449 26,160 26,877 27,854 28,995
Bank-owned life insurance 36,347 29,786 29,658 29,535 29,406
Deferred tax asset, net 20,042 15,042 15,240 15,945 15,838
Other assets 34,963 34,548 36,556 37,652 21,943
Total assets $2,575,490 $1,783,395 $1,687,795 $1,691,313 $1,581,463
LIABILITIES
Non-interest bearing deposits $339,999 $170,834 $160,818 $168,264 $167,931
Interest bearing deposits 1,610,678 1,104,320 1,099,575 1,080,686 1,032,105
Total deposits 1,950,677 1,275,154 1,260,393 1,248,950 1,200,036
Customer repurchase agreements 15,329 13,635 9,641 9,317 15,584
Federal Home Loan Bank advances 230,000 180,500 110,000 130,000 61,000
Junior subordinated debentures 32,640 24,823 24,754 24,687 24,620
Subordinated notes 48,676
Other liabilities 13,647 9,520 8,893 10,321 16,304
Total liabilities 2,290,969 1,503,632 1,413,681 1,423,275 1,317,544
EQUITY
Preferred stock series A 4,550 4,550 4,550 4,550 4,550
Preferred stock series B 5,196 5,196 5,196 5,196 5,196
Common stock 182 182 181 181 181
Additional paid-in-capital 196,306 195,711 194,687 194,297 193,465
Treasury stock, at cost (751) (741) (597) (560) (184)
Retained earnings 77,846 73,340 68,909 64,097 59,785
Accumulated other comprehensive income 1,192 1,525 1,188 277 926
Total equity 284,521 279,763 274,114 268,038 263,919
Total liabilities and equity $2,575,490 $1,783,395 $1,687,795 $1,691,313 $1,581,463


Unaudited consolidated statement of income for the three months ended:

September 30, June 30, March 31, December 31, September 30,
(Dollars in thousands) 2016 2016 2016 2015 2015
Interest income:
Loans, including fees $23,123 $18,547 $16,088 $15,524 $15,716
Factored receivables, including fees 9,021 8,639 7,822 8,952 8,829
Taxable securities 1,154 965 768 669 649
Tax exempt securities 80 6 7 14 17
Cash deposits 93 197 208 122 92
Total interest income 33,471 28,354 24,893 25,281 25,303
Interest expense:
Deposits 2,408 2,020 1,993 1,905 1,764
Junior subordinated debentures 382 312 302 288 283
Other borrowings 263 115 109 38 25
Total interest expense 3,053 2,447 2,404 2,231 2,072
Net interest income 30,418 25,907 22,489 23,050 23,231
Provision for loan losses 2,819 1,939 (511) 1,178 165
Net interest income after provision for loan losses 27,599 23,968 23,000 21,872 23,066
Non-interest income:
Service charges on deposits 984 695 659 744 710
Card income 767 577 546 559 574
Net OREO gains (losses) and valuation adjustments 63 (1,204) (11) (128) (58)
Net gains (losses) on sale of securities (68) 5 2 15
Net gains on sale of loans 4 12 234 363
Fee income 655 504 534 465 542
Bargain purchase gain 900 1,708
Asset management fees 1,553 1,605 1,629 1,670 1,744
Other 2,145 1,487 1,607 1,125 700
Total non-interest income 6,099 3,668 4,981 5,571 6,298
Non-interest expense:
Salaries and employee benefits 14,699 12,229 12,252 12,448 12,416
Occupancy, furniture and equipment 1,921 1,534 1,493 1,546 1,575
FDIC insurance and other regulatory assessments 143 281 224 300 252
Professional fees 1,874 1,101 1,073 906 1,344
Amortization of intangible assets 958 717 977 1,141 1,179
Advertising and promotion 779 628 519 374 618
Communications and technology 1,966 1,263 1,432 1,596 951
Other 3,452 2,578 2,108 2,591 2,210
Total non-interest expense 25,792 20,331 20,078 20,902 20,545
Net income before income tax 7,906 7,305 7,903 6,541 8,819
Income tax expense 3,099 2,679 2,897 2,032 2,891
Net income $4,807 $4,626 $5,006 $4,509 $5,928
Dividends on preferred stock (301) (195) (194) (197) (196)
Net income available to common stockholders $4,506 $4,431 $4,812 $4,312 $5,732


Loans held for investment summarized as of:

September 30, June 30, March 31, December 31, September 30,
(Dollars in thousands) 2016 2016 2016 2015 2015
Commercial real estate $420,742 $298,991 $293,485 $291,819 $247,175
Construction, land development, land 101,169 36,498 41,622 43,876 52,446
1-4 family residential properties 108,721 74,121 76,973 78,244 77,043
Farmland 139,109 35,795 33,250 33,573 25,784
Commercial 777,806 574,508 509,433 495,356 468,055
Factored receivables 213,955 237,520 199,532 215,088 201,803
Consumer 25,602 17,339 13,530 13,050 10,632
Mortgage warehouse 172,751 135,746 78,015 120,879 102,363
Total loans $1,959,855 $1,410,518 $1,245,840 $1,291,885 $1,185,301

A portion of our total loan portfolio consists of commercial finance products offered under our commercial finance brands on a nationwide basis, as further summarized below:

September 30, June 30, March 31, December 31, September 30,
(Dollars in thousands) 2016 2016 2016 2015 2015
Equipment $181,987 $167,000 $159,755 $148,951 $143,483
Asset based lending (General) 129,501 114,632 85,739 75,134 85,641
Asset based lending (Healthcare) 84,900 81,664 79,580 80,200 66,832
Premium finance 27,573 6,117 3,506 1,612
Factored receivables 213,955 237,520 199,532 215,088 201,803
Commercial finance $637,916 $606,933 $528,112 $520,985 $497,759
Total loans held for investment $1,959,855 $1,410,518 $1,245,840 $1,291,885 $1,185,301
Commercial finance as a % of total 33% 43% 42% 40% 42%
Community banking as a % of total 67% 57% 58% 60% 58%

Deposits summarized as of:

September 30, June 30, March 31, December 31, September 30,
(Dollars in thousands) 2016 2016 2016 2015 2015
Non-interest bearing demand $339,999 $170,834 $160,818 $168,264 $167,931
Interest bearing demand 311,351 235,877 227,002 238,833 206,603
Individual retirement accounts 103,007 64,204 63,265 60,971 58,619
Money market 209,572 120,929 111,578 112,214 117,888
Savings 171,665 77,625 77,969 74,759 72,244
Certificates of deposit 765,093 555,710 569,820 543,909 526,732
Brokered deposits 49,990 49,975 49,941 50,000 50,019
Total deposits $1,950,677 $1,275,154 $1,260,393 $1,248,950 $1,200,036


Net interest margin summarized for the three months ended:

September 30, 2016 June 30, 2016
Average Average Average Average
(Dollars in thousands) Balance Interest Rate Balance Interest Rate
Interest earning assets:
Interest earning cash balances $73,022 $93 0.51% $120,088 $197 0.66%
Taxable securities 253,690 1,138 1.78% 184,010 952 2.08%
Tax exempt securities 28,239 80 1.13% 1,063 6 2.27%
FHLB stock 9,627 16 0.66% 4,748 13 1.10%
Loans 1,723,896 32,144 7.42% 1,286,159 27,186 8.50%
Total interest earning assets $2,088,474 $33,471 6.38% $1,596,068 $28,354 7.15%
Non-interest earning assets:
Other assets 193,805 146,874
Total assets $2,282,279 $1,742,942
Interest bearing liabilities:
Deposits:
Interest bearing demand $280,689 $71 0.10% $242,862 $59 0.10%
Individual retirement accounts 87,723 253 1.15% 64,075 197 1.24%
Money market 182,124 96 0.21% 122,670 69 0.23%
Savings 140,338 23 0.07% 78,795 10 0.05%
Certificates of deposit 670,372 1,839 1.09% 565,600 1,560 1.11%
Brokered deposits 49,964 126 1.00% 49,950 125 1.01%
Total deposits 1,411,210 2,408 0.68% 1,123,952 2,020 0.72%
Junior subordinated debentures 29,977 382 5.07% 24,788 312 5.06%
Other borrowings 257,358 263 0.41% 139,601 115 0.33%
Total interest bearing liabilities $1,698,545 $3,053 0.72% $1,288,341 $2,447 0.76%
Non-interest bearing liabilities and equity:
Non-interest bearing demand deposits 283,128 166,863
Other liabilities 11,986 9,770
Total equity 288,620 277,968
Total liabilities and equity $2,282,279 $1,742,942
Net interest income $30,418 $25,907
Interest spread 5.66% 6.39%
Net interest margin 5.79% 6.53%


Metrics and non-GAAP financial reconciliation:

As of and for the Three Months Ended
September 30, June 30, March 31, December 31, September 30,
(Dollars in thousands, except per share amounts) 2016 2016 2016 2015 2015
Net income available to common stockholders $4,506 $4,431 $4,812 $4,312 $5,732
Bargain purchase gain, non-taxable (900) (1,708)
Acquisition related costs 1,618
Tax effect of acquisition related costs (251)
Adjusted net income available to common stockholders $5,873 $4,431 $4,812 $3,412 $4,024
Dilutive effect of convertible preferred stock 197
Adjusted net income available to common stockholders - diluted $6,070 $4,431 $4,812 $3,412 $4,024
Weighted average shares outstanding - diluted 18,101,676 18,042,585 17,981,276 17,916,251 18,587,821
Adjusted effects of assumed Preferred Stock conversion 676,351 (676,351)
Adjusted weighted average shares outstanding - diluted 18,778,027 18,042,585 17,981,276 17,916,251 17,911,470
Adjusted diluted earnings per common share $0.32 $0.25 $0.27 $0.19 $0.22
Net income available to common stockholders $4,506 $4,431 $4,812 $4,312 $5,732
Average tangible common equity 235,938 241,666 235,192 229,636 222,884
Return on average tangible common equity 7.60% 7.37% 8.23% 7.45% 10.20%
Efficiency ratio:
Net interest income $30,418 $25,907 $22,489 $23,050 $23,231
Non-interest income 6,099 3,668 4,981 5,571 6,298
Operating revenue 36,517 29,575 27,470 28,621 29,529
Bargain purchase gain (900) (1,708)
Adjusted operating revenue $36,517 $29,575 $27,470 $27,721 $27,821
Non-interest expenses $25,792 $20,331 $20,078 $20,902 $20,545
Acquisition related costs (1,618)
Adjusted non-interest expenses $24,174 $20,331 $20,078 $20,902 $20,545
Efficiency ratio 66.20% 68.74% 73.09% 75.40% 73.85%
Net non-interest expense to average assets ratio:
Non-interest expenses $25,792 $20,331 $20,078 $20,902 $20,545
Acquisition related costs (1,618)
Adjusted non-interest expenses $24,174 $20,331 $20,078 $20,902 $20,545
Total non-interest income $6,099 $3,668 $4,981 $5,571 $6,298
Bargain purchase gain (900) (1,708)
Adjusted non-interest income $6,099 $3,668 $4,981 $4,671 $4,590
Adjusted net non-interest expenses $18,075 $16,663 $15,097 $16,231 $15,955
Average total assets $2,282,279 $1,742,942 $1,682,640 $1,624,891 $1,565,698
Net non-interest expense to average assets ratio 3.15% 3.85% 3.61% 3.96% 4.04%



As of and for the Three Months Ended
September 30, June 30, March 31, December 31, September 30,
(Dollars in thousands, except per share amounts) 2016 2016 2016 2015 2015
Reported yield on loans 7.42% 8.50% 7.84% 8.17% 8.34%
Effect of accretion income on acquired loans (0.32%) (0.69%) (0.37%) (0.33%) (0.38%)
Adjusted yield on loans 7.10% 7.81% 7.47% 7.84% 7.96%
Reported net interest margin 5.79% 6.53% 5.90% 6.20% 6.45%
Effect of accretion income on acquired loans (0.26%) (0.55%) (0.29%) (0.26%) (0.31%)
Adjusted net interest margin 5.53% 5.98% 5.61% 5.94% 6.14%
Total stockholders' equity $284,521 $279,763 $274,114 $268,038 $263,919
Preferred stock liquidation preference (9,746) (9,746) (9,746) (9,746) (9,746)
Total common stockholders' equity 274,775 270,017 264,368 258,292 254,173
Goodwill and other intangibles (47,449) (26,160) (26,877) (27,854) (28,995)
Tangible common stockholders' equity $227,326 $243,857 $237,491 $230,438 $225,178
Common shares outstanding 18,106,978 18,107,493 18,015,423 18,018,200 18,040,072
Tangible book value per share $12.55 $13.47 $13.18 $12.79 $12.48
Total assets at end of period $2,575,490 $1,783,395 $1,687,795 $1,691,313 $1,581,463
Goodwill and other intangibles (47,449) (26,160) (26,877) (27,854) (28,995)
Adjusted total assets at period end $2,528,041 $1,757,235 $1,660,918 $1,663,459 $1,552,468
Tangible common stockholders' equity ratio 8.99% 13.88% 14.30% 13.85% 14.50%

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

  • "Common stockholders' equity" is defined as total stockholders' equity at end of period less the liquidation preference value of the preferred stock.
  • “Adjusted diluted earnings per common share” is defined as adjusted net income available to common stockholders divided by adjusted weighted average diluted common shares outstanding. Excluded from net income available to common stockholders are material gains and expenses related to merger and acquisition-related activities, net of tax. In our judgment, the adjustments made to net income available to common stockholders allow management and investors to better assess our performance in relation to our core net income by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business. Weighted average diluted common shares outstanding are adjusted as a result of changes in their dilutive properties given the gain and expense adjustments described herein.
  • "Tangible common stockholders' equity" is common stockholders' equity less goodwill and other intangible assets.
  • "Total tangible assets" is defined as total assets less goodwill and other intangible assets.
  • "Tangible book value per share" is defined as tangible common stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.
  • "Tangible common stockholders' equity ratio" is defined as the ratio of tangible common stockholders' equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets.
  • "Return on Average Tangible Common Equity" is defined as net income available to common stockholders divided by average tangible common stockholders' equity.
  • "Efficiency ratio" is defined as non-interest expenses divided by our operating revenue, which is equal to net interest income plus non-interest income. Also excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. In our judgment, the adjustments made to operating revenue allow management and investors to better assess our performance in relation to our core operating revenue by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.
  • "Net non-interest expense to average total assets" is defined as non-interest expenses net of non-interest income divided by total average assets. Excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. This metric is used by our management to better assess our operating efficiency.
  • "Adjusted yield on loans" is our yield on loans after excluding loan accretion from our acquired loan portfolio. Our management uses this metric to better assess the impact of purchase accounting on our yield on loans, as the effect of loan discount accretion is expected to decrease as the acquired loans roll off of our balance sheet.
  • “Adjusted net interest margin” is net interest margin after excluding loan accretion from the acquired loan portfolio. Our management uses this metric to better assess the impact of purchase accounting on net interest margin, as the effect of loan discount accretion is expected to decrease as the acquired loans mature or roll off of our balance sheet.

2) Adjusted to exclude material gains and expenses related to merger and acquisition-related activities, net of tax where applicable.

3) Asset quality ratios exclude loans held for sale.

4) Current quarter ratios are preliminary.

Investor Relations: Luke Wyse Vice President, Finance & Investor Relations lwyse@triumphllc.com 214-365-6936 Media Contact: Amanda Tavackoli Vice President, Marketing & Communication atavackoli@triumphllc.com 214-365-6930

Source:Triumph Bancorp, Inc.