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Allegiance Bancshares Reports Fourth Quarter and Year-End 2016 Results

  • Fourth quarter 2016 diluted earnings per common share of $0.44 compared to $0.33 for the fourth quarter 2015 and $0.42 for the third quarter 2016
  • Full year 2016 diluted earnings per common share of $1.75 compared to $1.43 for the year ended 2015
  • Core loans for the fourth quarter 2016 increased 14.5% year over year and 4.0% compared to the third quarter 2016
  • Continued shareholder value creation: tangible book value per common share grew 9.3% for the year ended 2016
  • Strong asset quality as evidenced by annualized net charge-offs of 0.04% for the fourth quarter and year ended 2016

HOUSTON, Jan. 24, 2017 (GLOBE NEWSWIRE) -- Allegiance Bancshares, Inc. (NASDAQ:ABTX) ("Allegiance"), the holding company of Allegiance Bank (the "Bank"), reported net income attributable to common stockholders of $5.8 million in the fourth quarter 2016, a 37.0% increase over the same period in 2015, and a 5.5% increase compared to the third quarter 2016. Net income per diluted common share increased 33.3% to $0.44 in the fourth quarter 2016 compared to $0.33 for the same period in 2015 and increased 4.8% compared to $0.42 for the third quarter 2016. Net income attributable to common shareholders for the year ended December 31, 2016 increased $7.6 million to $22.9 million, or $1.75 per diluted common share, compared to net income attributable to common shareholders of $15.2 million, or $1.43 per diluted common share, for the year ended December 31, 2015. Excluding the gain on the sale of two Central Texas branch locations during the first quarter 2016, net income attributable to common shareholders would have been $21.5 million and net income per diluted common share would have been $1.65 for the year ended December 31, 2016.

"We are pleased with our overall financial performance in 2016, and the fourth quarter represented another great quarter for Allegiance," said George Martinez, Allegiance's Chairman and Chief Executive Officer. "In our first full year of being a public company, we achieved a number of successes as we continued to deliver strong organic loan growth and record earnings. We owe our achievements to the exceptional efforts of our hard working and dedicated bankers along with the support we received from our loyal shareholders and customers. Allegiance enters the year 2017 with a strong balance sheet, a stable and diversified portfolio and a continued focus on superior asset quality," continued Martinez.

"We are focused on the execution of our business plan and positioning ourselves for significant growth in the future. Over the past year, we built upon our talented lending team by hiring 12 new lenders and further enhanced our infrastructure. We are strengthening our internal processes and systems which will provide our platform the requisite technology and capacity we will need to support our ambitious growth plans. We believe these efforts position us well for continued growth and shareholder value creation in 2017 and beyond," concluded Martinez.

Fourth Quarter 2016 Results

Fourth quarter 2016 annualized returns on average assets, average common equity and average tangible common equity were 0.93%, 8.25% and 9.79%, respectively, compared to 0.81%, 6.71% and 8.19%, respectively, for the fourth quarter 2015. The initial public offering of 2.9 million shares during the fourth quarter of 2015 generated net proceeds of $57.2 million. Annualized returns on average assets, average common equity and average tangible common equity for the third quarter 2016 were 0.90%, 7.77% and 9.21%, respectively.

Net interest income before provision for loan losses in the fourth quarter 2016 increased $2.2 million, or 10.2%, to $23.4 million from $21.3 million for the fourth quarter 2015 primarily due to organic loan growth and an increase in our securities portfolio. Net interest income before provision for loan losses in the fourth quarter 2016 increased slightly compared to the third quarter 2016. The net interest margin on a tax equivalent basis decreased 28 basis points to 4.32% for the fourth quarter 2016 from 4.60% for the fourth quarter 2015, primarily due to a higher level of securities as a percentage of our interest-earning assets. The net interest margin on a tax equivalent basis for the fourth quarter 2016 decreased 7 basis points from 4.39% for the third quarter 2016. Excluding the impact of acquisition accounting adjustments, the net interest margin in the fourth quarter 2016 would have been 4.27%, compared to 4.47% and 4.33% in the fourth quarter 2015 and third quarter 2016, respectively.

Noninterest income in the fourth quarter 2016 was $1.5 million, an increase of $500 thousand, or 51.1%, compared to $978 thousand in the fourth quarter 2015, and an increase of $204 thousand, or 16.0%, compared to $1.3 million in the third quarter 2016.

Noninterest expense in the fourth quarter 2016 increased $2.3 million, or 16.5%, to $16.2 million from $13.9 million in the fourth quarter 2015, and increased $1.3 million, or 8.7%, from $14.9 million in the third quarter 2016. The increase in noninterest expense during the fourth quarter 2016 was primarily due to increases in salaries and benefits and professional fees related to supporting growth initiatives. In the fourth quarter 2016, Allegiance’s efficiency ratio increased to 65.09% from 62.40% in the fourth quarter 2015 and 60.34% in the third quarter 2016.

Year Ended December 31, 2016 Results

For the year ended December 31, 2016, annualized returns on average assets, average common equity and average tangible common equity were 0.98%, 8.36% and 9.96%, respectively, compared to 0.81%, 7.43% and 9.52%, respectively, for the year ended December 31, 2015. Excluding the gain on the sale of two Central Texas branch locations during the first quarter 2016, the annualized returns on average assets, average common equity and average tangible common equity for the year ended December 31, 2016 would have been 0.92%, 7.88% and 9.38%, respectively.

Net interest income before provision for loan losses for the year ended December 31, 2016 increased $9.7 million, or 12.1%, to $89.9 million from $80.2 million for the year ended December 31, 2015 primarily due to organic growth within the loan portfolio and an increase in our securities portfolio. The net interest margin on a tax equivalent basis decreased 31 basis points to 4.37% for the year ended December 31, 2016 from 4.68% for the year ended December 31, 2015. Excluding the impact of acquisition accounting adjustments, the net interest margin for the year ended December 31, 2016 would have been 4.30%, compared to 4.44% for the year ended December 31, 2015.

Noninterest income for the year ended December 31, 2016 was $7.3 million, an increase of $3.3 million, or 82.1%, when compared to $4.0 million for the year ended December 31, 2015. Noninterest income for the year ended 2016 included the gain on the sale of two Central Texas branch locations in the first quarter 2016.

Noninterest expense for the year ended December 31, 2016 increased $4.5 million, or 8.1%, to $59.3 million from $54.8 million for the year ended December 31, 2015. Allegiance’s efficiency ratio for the year ended December 31, 2016 decreased to 62.34% from 65.27% for the year ended December 31, 2015.

Financial Condition

Total loans at December 31, 2016 increased $210.6 million, or 12.5%, to $1.89 billion compared to $1.68 billion at December 31, 2015 and increased $60.9 million, or 3.3%, compared to $1.83 billion at September 30, 2016. These increases were due to strong organic loan growth within the Bank’s loan portfolio. Core loans as of December 31, 2016, excluding the mortgage warehouse portfolio and loans held for sale, increased $230.5 million, or 14.5%, to $1.82 billion from $1.59 billion at December 31, 2015 and increased $69.9 million, or 4.0%, from $1.75 billion at September 30, 2016.

Deposits at December 31, 2016 increased $111.1 million, or 6.3%, to $1.87 billion compared to $1.76 billion at December 31, 2015 and decreased $30.7 million, or 1.6%, compared to $1.90 billion at September 30, 2016.

Asset Quality

Nonperforming assets totaled $18.5 million, or 0.75% of total assets, at December 31, 2016, compared to $5.3 million, or 0.25% of total assets, at December 31, 2015, and $17.1 million, or 0.69% of total assets, at September 30, 2016. The allowance for loan losses was 0.95% of total loans at December 31, 2016, 0.78% of total loans at December 31, 2015, and 0.94% of total loans at September 30, 2016.

The provision for loan losses in the fourth quarter 2016 was $900 thousand, or 0.19% (annualized) of average loans, compared to $2.2 million, or 0.53% (annualized) of average loans, in the fourth quarter 2015, and $2.2 million, or 0.49% (annualized) of average loans, in the third quarter 2016. The provision for loan losses for the year ended December 31, 2016 was $5.5 million, or 0.31% of average loans, compared to $5.8 million, or 0.38% of average loans for the year ended December 31, 2015. Fourth quarter 2016 net charge-offs were $174 thousand, or 0.04% (annualized) of average loans, compared to net charge-offs of $51 thousand, or 0.01% (annualized) of average loans, in the fourth quarter 2015, and net recoveries of $54 thousand, in the third quarter 2016. Net charge-offs for the year ended December 31, 2016 were $656 thousand, or 0.04% of average loans, compared to $940 thousand, or 0.06% of average loans for the year ended December 31, 2015.

GAAP Reconciliation of Non-GAAP Financial Measures

Allegiance’s management uses certain non-GAAP financial measures to evaluate its performance. Specifically, Allegiance reviews tangible book value per common share, return on average tangible common equity and the ratio of tangible common equity to tangible assets. Please refer to the GAAP Reconciliation and Management’s Explanation of non-GAAP Financial Measures on page 10 of this Earnings Release for a reconciliation of these non-GAAP financial measures.

Conference Call

As previously announced, Allegiance’s management team will host a conference call on Tuesday, January 24, 2017 at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) to discuss its fourth quarter and full year 2016 results. Individuals and investment professionals may participate in the call by dialing (877) 279-2520. The conference ID number is 50658288. Alternatively, a simultaneous webcast may be accessed via the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under Upcoming Events.

Allegiance Bancshares, Inc.

Allegiance Bancshares, Inc. is a $2.45 billion asset Houston, Texas-based bank holding company. Through its wholly owned subsidiary, Allegiance Bank, Allegiance provides a diversified range of commercial banking services primarily to Houston metropolitan area-based small to medium-sized businesses and individual customers. Allegiance’s unique super-community banking strategy was designed to foster strong customer relationships while benefitting from a platform and scale that is competitive with larger local and regional banks. Allegiance Bank operates 16 full-service banking locations in the Houston metropolitan area. Visit www.allegiancebank.com for more information.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

This release may contain forward-looking statements within the meaning of the securities laws that are based on various facts and derived utilizing important assumptions, present expectations, estimates and projections about Allegiance and its subsidiaries. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing words. Forward-looking statements include information concerning Allegiance’s future financial performance, business and growth strategy, projected plans and objectives, as well as projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of Allegiance’s control, which may cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include but are not limited to whether Allegiance can: continue to develop and maintain new and existing customer and community relationships; successfully implement its growth strategy, including identifying suitable acquisition targets and integrating the businesses of acquired companies and banks; continue to sustain its current internal growth rate; provide quality and competitive products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its performance objectives. These and various other risk factors are discussed in Allegiance’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 and in other reports and statements Allegiance has filed with the Securities and Exchange Commission. Copies of such filings are available for download free of charge from the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under Financial Information, SEC Filings. Any forward-looking statement made by Allegiance in this release speaks only as of the date on which it is made. Factors or events that could cause Allegiance’s actual results to differ may emerge from time to time, and it is not possible for Allegiance to predict all of them. Allegiance undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
2016 2015
December 31 September 30 June 30 March 31 December 31
(Dollars in thousands)
Cash and cash equivalents$142,098 $225,082 $210,863 $183,290 $148,431
Available for sale securities316,455 310,033 303,463 215,401 165,097
Total loans (including loans held for sale)1,891,635 1,830,722 1,753,683 1,717,448 1,681,052
Allowance for loan losses(17,911) (17,185) (14,917) (13,757) (13,098)
Loans, net1,873,724 1,813,537 1,738,766 1,703,691 1,667,954
Goodwill39,389 39,389 39,389 39,389 39,389
Core deposit intangibles, net4,055 4,250 4,446 4,641 5,230
Premises and equipment, net18,340 17,811 17,821 18,121 18,471
Other real estate owned1,503 1,138 1,397 1,397
Bank owned life insurance21,837 21,684 21,530 21,377 21,211
Other assets33,547 28,978 29,906 23,400 18,796
Total assets$2,450,948 $2,461,902 $2,367,581 $2,210,707 $2,084,579
Noninterest-bearing deposits$593,751 $604,278 $630,689 $684,245 $620,320
Interest-bearing deposits1,276,432 1,296,601 1,212,650 1,158,409 1,138,813
Total deposits1,870,183 1,900,879 1,843,339 1,842,654 1,759,133
Short-term borrowings85,000 61,000 30,000 85,000 50,000
Other borrowed funds200,569 200,569 200,569 569 569
Subordinated debentures9,196 9,169 9,142 9,115 9,089
Other liabilities6,183 9,190 8,280 7,076 7,298
Total liabilities2,171,131 2,180,807 2,091,330 1,944,414 1,826,089
Common stock12,958 12,905 12,869 12,845 12,815
Capital surplus212,649 211,349 210,512 209,883 209,285
Retained earnings57,262 51,491 46,020 40,766 34,411
Accumulated other comprehensive income(3,052) 5,350 6,850 2,799 2,017
Less: Treasury stock (38)
Total stockholders’ equity279,817 281,095 276,251 266,293 258,490
Total liabilities and equity$2,450,948 $2,461,902 $2,367,581 $2,210,707 $2,084,579


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
Three Months Ended Year Ended
2016 2015 2016 2015
December 31 September 30 June 30 March 31 December 31 December 31 December 31
(Dollars in thousands)
INTEREST INCOME:
Loans, including fees$24,232 $24,057 $22,839 $22,228 $22,431 $93,356 $85,443
Securities
Taxable478 607 452 270 244 1,807 1,122
Tax-exempt1,642 1,505 1,086 811 745 5,044 2,002
Deposits in other financial institutions129 150 150 142 72 571 239
Total interest income26,481 26,319 24,527 23,451 23,492 100,778 88,806
INTEREST EXPENSE:
Demand, money market and savings deposits673 651 569 544 579 2,437 2,161
Certificates and other time deposits1,947 1,872 1,665 1,560 1,470 7,044 5,112
Short-term borrowings90 63 106 139 33 398 82
Subordinated debt128 123 120 117 139 488 578
Other borrowed funds221 201 118 7 16 547 707
Total interest expense3,059 2,910 2,578 2,367 2,237 10,914 8,640
NET INTEREST INCOME23,422 23,409 21,949 21,084 21,255 89,864 80,166
Provision for loan losses900 2,214 1,645 710 2,159 5,469 5,792
Net interest income after provision for loan losses22,522 21,195 20,304 20,374 19,096 84,395 74,374
NONINTEREST INCOME:
Nonsufficient funds fees178 175 145 163 191 661 703
Service charges on deposit accounts177 182 173 145 166 677 680
Gain on sale of branch assets 2,050 2,050
Gain (loss) on sale of securities30 (37) 30 (37)
Gain (loss) on sale of other real estate206 60 266 (5)
Gain on sale of loans 235
Bank owned life insurance153 154 153 166 171 626 604
Other734 703 741 780 487 2,958 1,812
Total noninterest income1,478 1,274 1,212 3,304 978 7,268 3,992
NONINTEREST EXPENSE:
Salaries and employee benefits10,627 9,781 9,177 9,273 8,905 38,858 35,324
Net occupancy and equipment1,238 1,260 1,214 1,232 1,179 4,944 4,826
Depreciation391 404 415 417 424 1,627 1,614
Data processing and software amortization703 655 622 653 750 2,633 3,044
Professional fees857 442 401 534 451 2,234 1,671
Regulatory assessments and FDIC insurance485 396 355 345 356 1,581 1,346
Core deposit intangibles amortization195 196 195 199 208 785 830
Communications237 264 274 280 298 1,055 1,290
Advertising319 228 197 201 271 945 781
Other1,135 1,269 1,073 1,119 1,054 4,596 4,079
Total noninterest expense16,187 14,895 13,923 14,253 13,896 59,258 54,805
INCOME BEFORE INCOME TAXES7,813 7,574 7,593 9,425 6,178 32,405 23,561
Provision for income taxes2,042 2,103 2,339 3,070 1,966 9,554 7,775
NET INCOME5,771 5,471 5,254 6,355 4,212 22,851 15,786
Preferred stock dividends 559
NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS$5,771 $5,471 $5,254 $6,355 $4,212 $22,851 $15,227


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
Three Months Ended Year Ended
2016 2015 2016 2015
December 31 September 30 June 30 March 31 December 31 December 31 December 31
(Dollars and share amounts in thousands, except per share data)
Net income$5,771 $5,471 $5,254 $6,355 $4,212 $22,851 $15,786
Net income attributable to common stockholders$5,771 $5,471 $5,254 $6,355 $4,212 $22,851 $15,227
Earnings per common share, basic$0.45 $0.42 $0.41 $0.49 $0.34 $1.78 $1.45
Earnings per common share, diluted$0.44 $0.42 $0.40 $0.49 $0.33 $1.75 $1.43
Return on average assets(A)0.93% 0.90% 0.91% 1.19% 0.81% 0.98% 0.81%
Return on average common equity(A)8.25% 7.77% 7.79% 9.70% 6.71% 8.36% 7.43%
Return on average tangible common equity(A) (B)9.79% 9.21% 9.30% 11.67% 8.19% 9.96% 9.52%
Tax equivalent net interest margin(C)4.32% 4.39% 4.32% 4.45% 4.60% 4.37% 4.68%
Efficiency ratio(D)65.09% 60.34% 60.11% 63.80% 62.40% 62.34% 65.27%
Liquidity and Capital Ratios
Equity to assets11.42% 11.42% 11.67% 12.05% 12.40% 11.42% 12.40%
Common equity Tier 1 capital11.44% 11.40% 11.50% 11.57% 11.72% 11.44% 11.72%
Tier 1 risk-based capital11.87% 11.84% 11.97% 12.04% 12.21% 11.87% 12.21%
Total risk-based capital12.72% 12.68% 12.72% 12.76% 12.92% 12.72% 12.92%
Tier 1 leverage capital10.35% 10.25% 10.43% 10.92% 11.02% 10.35% 11.02%
Tangible common equity to tangible assets(B)9.82% 9.82% 10.00% 10.26% 10.48% 9.82% 10.48%
Other Data
Weighted average shares:
Basic12,913 12,882 12,857 12,840 12,390 12,873 10,470
Diluted13,180 13,108 13,039 12,967 12,589 13,074 10,654
Period end shares outstanding12,958 12,905 12,869 12,845 12,813 12,958 12,813
Book value per common share$21.59 $21.78 $21.47 $20.73 $20.17 $21.59 $20.17
Tangible book value per common share(B)$18.24 $18.40 $18.06 $17.30 $16.69 $18.24 $16.69
(A) Interim periods annualized.
(B) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on page 10 of this Earnings Release.
(C) Net interest margin represents net interest income divided by average interest-earning assets.
(D) Represents noninterest expense divided by the sum of net interest income on a tax equivalent basis plus noninterest income, excluding net gains and losses on the sale of branch assets, loans and securities. Additionally, taxes and provision for loan losses are not part of this calculation.


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
Three Months Ended
December 31, 2016 September 30, 2016 December 31, 2015
Average
Balance
Interest
Earned/
Interest Paid
Average
Yield/
Rate
Average
Balance
Interest
Earned/
Interest
Paid
Average
Yield/
Rate
Average
Balance
Interest
Earned/
Interest
Paid
Average
Yield/
Rate
(Dollars in thousands)
Assets
Interest-Earning Assets:
Loans$1,847,122 $24,232 5.22% $1,784,763 $24,057 5.36% $1,631,068 $22,431 5.46%
Securities314,387 2,120 2.68% 310,769 2,112 2.70% 161,245 989 2.43%
Deposits in other financial institutions68,974 129 0.74% 92,928 150 0.64% 72,262 72 0.40%
Total interest-earning assets2,230,483 26,481 4.72% 2,188,460 26,319 4.78% 1,864,575 23,492 5.00%
Allowance for loan losses(17,579) (15,575) (11,598)
Noninterest-earning assets247,465 249,363 222,624
Total assets$2,460,369 $2,422,248 $2,075,601
Liabilities and Stockholders' Equity
Interest-Bearing Liabilities:
Interest-bearing demand deposits$107,180 $84 0.31% $111,497 $95 0.34% $95,696 $67 0.28%
Money market and savings deposits507,362 589 0.46% 484,587 556 0.46% 456,867 512 0.44%
Certificates and other time deposits681,425 1,947 1.14% 668,092 1,872 1.11% 591,403 1,470 0.99%
Short-term borrowings57,478 90 0.63% 44,163 63 0.57% 63,587 33 0.20%
Subordinated debt9,178 128 5.55% 9,151 123 5.35% 9,072 139 6.06%
Other borrowed funds200,570 221 0.44% 200,569 201 0.40% 5,053 16 1.24%
Total interest-bearing liabilities1,563,193 3,059 0.78% 1,518,059 2,910 0.76% 1,221,678 2,237 0.73%
Noninterest-Bearing Liabilities:
Noninterest-bearing demand deposits610,310 614,303 596,854
Other liabilities8,743 9,821 8,144
Total liabilities2,182,246 2,142,183 1,826,676
Stockholders' equity278,123 280,065 248,925
Total liabilities and stockholders' equity$2,460,369 $2,422,248 $2,075,601
Net interest rate spread 3.94% 4.02% 4.27%
Net interest income and margin $23,422 4.18% $23,409 4.26% $21,255 4.52%
Net interest income and margin (tax equivalent) $24,219 4.32% $24,149 4.39% $21,623 4.60%


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
Year Ended
December 31, 2016 December 31, 2015
Average
Balance
Interest
Earned/
Interest
Paid
Average
Yield/
Rate
Average
Balance
Interest
Earned/
Interest
Paid
Average
Yield/
Rate
(Dollars in thousands)
Assets
Interest-Earning Assets:
Loans$1,755,319 $93,356 5.32% $1,525,325 $85,443 5.60%
Securities270,789 6,851 2.53% 136,277 3,124 2.29%
Deposits in other financial institutions87,485 571 0.65% 73,995 239 0.32%
Total interest-earning assets2,113,593 100,778 4.77% 1,735,597 88,806 5.12%
Allowance for loan losses(15,200) (10,004)
Noninterest-earning assets240,202 211,419
Total assets$2,338,595 $1,937,012
Liabilities and Stockholders' Equity
Interest-Bearing Liabilities:
Interest-bearing demand deposits$104,212 $334 0.32% $100,139 $323 0.32%
Money market and savings deposits465,403 2,103 0.45% 429,153 1,838 0.43%
Certificates and other time deposits648,075 7,044 1.09% 559,247 5,112 0.91%
Short-term borrowings78,910 398 0.50% 43,989 82 0.19%
Subordinated debt9,138 488 5.34% 9,004 578 6.42%
Other borrowed funds130,469 547 0.42% 22,354 707 3.16%
Total interest-bearing liabilities1,436,207 10,914 0.76% 1,163,886 8,640 0.74%
Noninterest-Bearing Liabilities:
Noninterest-bearing demand deposits620,701 554,704
Other liabilities8,476 7,316
Total liabilities2,065,384 1,725,906
Stockholders' equity273,211 211,106
Total liabilities and stockholders' equity$2,338,595 $1,937,012
Net interest rate spread 4.01% 4.38%
Net interest income and margin $89,864 4.25% $80,166 4.62%
Net interest income and margin (tax equivalent) $92,330 4.37% $81,156 4.68%


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
Three Months Ended
2016 2015
December 31 September 30 June 30 March 31 December 31
(Dollars in thousands)
Period-end Loan Portfolio:
Loans held for sale$ $ $ $ $27,887
Commercial and industrial416,752 402,273 382,795 372,056 383,044
Mortgage warehouse67,038 76,043 75,554 86,157 59,071
Real Estate:
Commercial real estate (including multi-family residential)891,989 848,939 806,771 770,252 745,595
Commercial real estate construction and land development159,247 167,936 161,572 167,810 154,646
1-4 family residential (including home equity)246,987 228,651 214,442 209,704 205,200
Residential construction98,657 93,923 101,677 100,611 93,848
Consumer and other10,965 12,957 10,872 10,858 11,761
Total loans$1,891,635 $1,830,722 $1,753,683 $1,717,448 $1,681,052
Asset Quality:
Nonaccrual loans$15,788 $15,882 $7,124 $6,979 $5,184
Accruing loans 90 or more days past due911
Total nonperforming loans16,699 15,882 7,124 6,979 5,184
Other real estate1,503 1,138 1,397 1,397
Other repossessed assets286 30 128 131 131
Total nonperforming assets$18,488 $17,050 $8,649 $8,507 $5,315
Net charge-offs (recoveries)$174 $(54) $485 $51 $265
Nonaccrual loans:
Loans held for sale$ $ $ $ $209
Commercial and industrial5,939 4,983 2,723 2,700 2,664
Mortgage warehouse
Real Estate:
Commercial real estate (including multi-family residential)9,579 10,495 4,141 3,293 2,006
Commercial real estate construction and land development
1-4 family residential (including home equity)8 11 227 934 239
Residential construction
Consumer and other262 393 33 52 66
Total nonaccrual loans$15,788 $15,882 $7,124 $6,979 $5,184
Asset Quality Ratios:
Nonperforming assets to total assets0.75% 0.69% 0.37% 0.38% 0.25%
Nonperforming loans to total loans0.88% 0.87% 0.41% 0.41% 0.31%
Allowance for loan losses to nonperforming loans107.26% 108.20% 209.39% 197.12% 252.66%
Allowance for loan losses to total loans0.95% 0.94% 0.85% 0.80% 0.78%
Net charge-offs (recoveries) to average loans (annualized)0.04% (0.01)% 0.11% 0.01% 0.06%

Allegiance Bancshares, Inc.
GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures
(Unaudited)

Allegiance’s management uses certain non−GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Specifically, Allegiance reviews tangible book value per common share, return on average tangible common equity and the ratio of tangible common equity to tangible assets for internal planning and forecasting purposes. Allegiance has included in this Earnings Release information relating to these non-GAAP financial measures for the applicable periods presented. Allegiance believes these non-GAAP financial measures provide information useful to management and investors that is supplementary to our financial condition and results of operations computed in accordance with GAAP. These non-GAAP measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which Allegiance calculates the non-GAAP financial measures may differ from that of other companies reporting measures with similar names.

Three Months Ended Year Ended
2016 2015 2016 2015
December 31 September 30 June 30 March 31 December 31 December 31 December 31
(Dollars and share amounts in thousands, except per share data)
Total Stockholders' equity $279,817 $281,095 $276,251 $266,293 $258,490 $279,817 $258,490
Less: Goodwill and core deposit intangibles, net 43,444 43,639 43,835 44,030 44,619 43,444 44,619
Tangible stockholders’ equity $236,373 $237,456 $232,416 $222,263 $213,871 $236,373 $213,871
Less: Preferred Stock
Tangible common stockholders’ equity $236,373 $237,456 $232,416 $222,263 $213,871 $236,373 $213,871
Shares outstanding at end of period 12,958 12,905 12,869 12,845 12,813 12,958 12,813
Tangible book value per common share $18.24 $18.40 $18.06 $17.30 $16.69 $18.24 $16.69
Net income attributable to common stockholders $5,771 $5,471 $5,254 $6,355 $4,212 $22,851 $15,227
Average common stockholders' equity $278,123 $280,065 $271,128 $263,397 $248,925 $273,211 $204,935
Less: Average goodwill and core deposit intangibles, net 43,539 43,735 43,930 44,319 44,886 43,880 45,055
Average tangible common stockholders’ equity $234,584 $236,330 $227,198 $219,078 $204,039 $229,331 $159,880
Return on average tangible common equity 9.79% 9.21% 9.30% 11.67% 8.19% 9.96% 9.52%
Total assets $2,450,948 $2,461,902 $2,367,581 $2,210,707 $2,084,579 $2,450,948 $2,084,579
Less: Goodwill and core deposit intangibles, net 43,444 43,639 43,835 44,030 44,619 43,444 44,619
Tangible assets $2,407,504 $2,418,263 $2,323,746 $2,166,677 $2,039,960 $2,407,504 $2,039,960
Tangible common equity to tangible assets 9.82% 9.82% 10.00% 10.26% 10.48% 9.82% 10.48%


Allegiance Bancshares, Inc. 8847 West Sam Houston Parkway N., Suite 200 Houston, Texas 77040 ir@allegiancebank.com

Source:Allegiance Bancshares, Inc.