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Simmons First Announces 27% Increase in Fourth Quarter Earnings

PINE BLUFF, Ark., Jan. 24, 2013 (GLOBE NEWSWIRE) -- Simmons First National Corporation (Nasdaq:SFNC) today announced fourth quarter 2012 net income of $8.0 million, a 27.4% increase compared to $6.3 million for the same quarter in 2011. Diluted earnings per share were $0.48, an $0.11, or 29.8% increase over the same period in 2011. For the year ended December 31, 2012, net income was $27.7 million, or $1.64 diluted earnings per share, compared to $1.47 per share for 2011, an increase of $0.17, or 11.6%.

On October 19, 2012, the Company announced that its wholly-owned bank subsidiary, Simmons First National Bank, entered into a purchase and assumption agreement with loss share arrangements with the FDIC to purchase $180 million in assets and assume substantially all of the deposits and other liabilities of Excel Bank of Sedalia, Missouri. The Company recognized a pre-tax bargain purchase gain of $2.3 million on this transaction and incurred pre-tax merger related costs of $1.1 million. After taxes, the combined non-recurring items from the transactions contributed $735,000 to net income, or $0.04 to diluted earnings per share.

"There are many positives with our earnings announcement. Personally I believe the 27% net income growth is a major accomplishment. Even more significant is the way it was accomplished through the execution of our strategic plan, which resulted in the deployment of our excess capital in two strategic acquisitions, continued improvement in our asset quality numbers that were already strong and new initiatives that were introduced in all eight of our banks that resulted in good growth in our loan portfolios and customer relationships," commented J. Thomas May, Chairman and CEO.

Loans

Total loans, including those acquired, were $1.9 billion at December 31, 2012, an increase of $184.3 million, or 10.6%, compared to the same period in 2011. Loans acquired in FDIC-assisted acquisitions grew $135.6 million, net of discounts, and legacy loans (excluding acquired loans) grew $48.7 million, or 3.1%. "This was the second consecutive quarter of organic loan growth. While not enough to call a trend, we believe it is very positive in that the growth is coming throughout our markets in Arkansas, Kansas and Missouri. Needless to say, the economy remains in a slow recovery, which makes this growth even more significant," added May.

Deposits

At December 31, 2012, total deposits were $2.9 billion, an increase of $224 million, or 8.4%, compared to the same period in 2011. Deposits acquired in the Excel acquisition were $117 million at quarter end. Total non-time deposits totaled $2.0 billion, or 70% of total deposits.

Net Interest Income

The Company's net interest income for the fourth quarter of 2012 was $30.6 million, an increase of $3.3 million, or 12.1%, from the same period of 2011. Net interest margin was 3.99% for the quarter ended December 31, 2012. Included in interest income for the period is the additional yield accretion recognized as a result of updated estimates of the cash flows of the loan pools acquired in the Company's 2010 FDIC-assisted transactions. Each quarter, the Company estimates the cash flows expected to be collected from the acquired loan pools, and adjustments may or may not be required. The cash flows estimate has increased based on payment histories and reduced loss expectations of the loan pools. This resulted in increased interest income that is spread on a level-yield basis over the remaining expected lives of the loan pools. The increases in expected cash flows also reduce the amount of expected reimbursements under the loss sharing agreements with the FDIC, 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 Year Ended
(In thousands) December 31, 2012 December 31, 2012
2012 2011 2012 2011
Impact on net interest income $ 2,647 $ 1,124 $ 11,751 $ 1,124
Non-interest income (2,510) (978) (10,755) (978)
Net impact to pre-tax income $ 137 $ 146 $ 997 $ 146

Because these adjustments will be recognized over the remaining lives of the loan pools 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 $19.2 million and the remaining adjustment to the indemnification assets that will reduce non-interest income is $16.8 million. Of the remaining adjustments, we expect to recognize $9.6 million of interest income and a $9.1 million reduction of non-interest income, for a net addition to pre-tax income of approximately $540,000 during 2013. The accretable yield adjustments recorded in future periods will change as the Company continues to evaluate expected cash flows from the acquired loan pools.

Non-Interest Income

Non-interest income for the fourth quarter was $14.8 million, compared to $12.8 million for the fourth quarter of 2011. "There was a $1.5 million incremental decrease in non-interest income compared to the fourth quarter last year due to reductions of the indemnification assets resulting from increased cash flows expected to be collected from the FDIC covered loan portfolios," reiterated May. "Excluding the indemnification asset adjustment and a non-recurring $2.3 million bargain purchase gain on the Excel Bank acquisition, non-interest income increased $1.1 million, or 8.9%."

Non-Interest Expense

Non-interest expense for the fourth quarter of 2012 was $32.2 million, an increase of $3.7 million compared to the same period in 2011. "Included in the quarter were $1.1 million in merger related expenses and $2.4 million in normal operating expenses attributable to our FDIC-assisted acquisitions. Normalized for these acquisition related items, non-interest expense for the quarter increased by only 1%. Obviously, we continue to have good expense control as a result of the implementation of our efficiency initiatives," added May.

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 December 31, 2012, acquired loans covered by loss share were carried at $211 million, OREO covered by loss share was carried at $28 million and the FDIC loss share indemnification asset was carried at $75 million. Acquired loans and OREO not covered by loss share were carried at $83 million and $12 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.

The Company's allowance for loan losses was $27.9 million at December 31, 2012, or 1.71% of total loans and 232% of non-performing loans. Non-performing loans as a percent of total loans were 0.74% as of December 31, 2012 compared to 0.73% as of September 30, 2012. "Included in our non-performing assets was $11.8 million, net of a credit mark, of non-covered OREO we acquired in our two recent FDIC-assisted transactions. Normalizing for the acquired OREO, our legacy non-performing assets decreased $1.2 million for the previous quarter. Our legacy non-performing assets as a percent of total assets of 0.96% as of December 31, 2012 continues to compare favorably to the industry and our peer group," commented May. For the fourth quarter, the annualized net charge-off ratio, excluding credit cards, was 0.24%, and the annualized credit card charge-off ratio was 1.54%.

Capital

At December 31, 2012, stockholders' equity was $406 million, book value per share was $24.55 and tangible book value per share was $20.66. The Company's ratio of stockholders' equity to total assets was 11.5% and its ratio of tangible common equity to tangible assets was 9.9%, as of December 31, 2012.

"Our exceptional level of capital puts us in the 82nd percentile of our peer group and allows us to actively pursue the right opportunities that meet our strategic plan regarding mergers and acquisitions," continued May. As of December 31, 2012, the Company's regulatory capital ratios remain significantly higher than regulatory "well capitalized" guidelines:

"Well Capitalized" SFNC
Tier 1 Leverage Ratio 5.00% 10.81%
Tier 1 Risk-Based Capital Ratio 6.00% 19.08%
Total Risk-Based Capital Ratio 10.00% 20.34%

Stock Repurchase Program

During 2012, the Company repurchased approximately 726,000 shares at an average price of $24.24. The Company plans to continue to allocate its earnings, less dividends, to its stock repurchase program.

Simmons First National Corporation

Simmons First National Corporation is an eight bank financial holding company with community banks in Pine Bluff, Lake Village, Jonesboro, Rogers, Searcy, Russellville, El Dorado and Hot Springs, Arkansas. The Company's eight banks conduct financial operations from 96 offices, of which 92 are financial centers, in 55 communities in Arkansas, Missouri and Kansas, including its recently acquired branches in Missouri. The Company's common stock trades on the NASDAQ Global Select Market under the symbol "SFNC".

The Simmons First National Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4819

Conference Call

Management will conduct a conference call to review this information beginning at 3:00 p.m. Central Time on Thursday, January 24, 2013. Interested persons can listen to this call by dialing 1-888-438-5524 (United States and Canada only) and asking for the Simmons First National Corporation conference call. A replay of the call will be available through 5:00 p.m. Central Time on January 30, 2013, by dialing 1-888-203-1112. The passcode for the replay is 1242917. 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 exclude the effects of the amortization of intangibles and 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 Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands)
ASSETS
Cash and non-interest bearing balances due from banks $ 47,470 $ 40,356 $ 29,708 $ 34,314 $ 35,087
Interest bearing balances due from banks 467,984 440,524 515,874 642,929 535,119
Federal funds sold 22,343 7,571 -- 750 --
Cash and cash equivalents 537,797 488,451 545,582 677,993 570,206
Investment securities - held-to-maturity 496,141 510,630 525,522 481,314 525,444
Investment securities - available-for-sale 191,342 205,051 166,966 176,466 172,212
Mortgage loans held for sale 25,367 23,980 15,495 24,351 22,976
Assets held in trading accounts 6,224 7,002 7,812 7,708 7,541
Loans:
Not covered by FDIC loss share agreements 1,628,513 1,623,401 1,614,736 1,543,653 1,579,769
Acquired, not covered by FDIC loss share agreements
(net of discounts) 82,764 73,023 -- -- --
Covered by FDIC loss share agreements (net of discounts) 210,842 163,657 114,189 129,735 158,075
Allowance for loan losses (27,882) (28,145) (28,397) (28,325) (30,108)
Net loans 1,894,237 1,831,936 1,700,528 1,645,063 1,707,736
FDIC indemnification asset 75,286 59,547 35,038 39,978 47,683
Premises and equipment 87,557 85,969 85,171 85,784 86,486
Foreclosed assets not covered by FDIC loss share agreements 33,352 29,665 23,947 24,542 22,887
Foreclosed assets covered by FDIC loss share agreements 27,620 26,466 11,252 11,705 11,685
Interest receivable 14,530 15,253 12,975 13,319 15,126
Bank owned life insurance 52,066 51,681 51,326 50,934 50,579
Goodwill 60,605 60,605 60,605 60,605 60,605
Core deposit premiums 3,760 2,549 1,431 1,505 1,579
Other assets 21,605 16,195 13,494 18,786 17,384
Total assets $ 3,527,489 $ 3,414,980 $ 3,257,144 $ 3,320,053 $ 3,320,129
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing transaction accounts $ 576,655 $ 543,380 $ 517,854 $ 521,202 $ 532,259
Interest bearing transaction accounts and savings deposits 1,421,137 1,343,784 1,290,954 1,282,763 1,239,504
Time deposits less than $100,000 505,773 521,259 467,503 485,134 499,809
Time deposits greater than $100,000 370,598 386,872 352,973 365,478 378,825
Total deposits 2,874,163 2,795,295 2,629,284 2,654,577 2,650,397
Federal funds purchased and securities sold under agreements to repurchase 104,078 64,829 70,220 106,224 114,766
Other borrowings 89,441 88,852 90,866 90,312 90,170
Subordinated debentures 20,620 20,620 30,930 30,930 30,930
Accrued interest and other liabilities 33,125 41,136 28,431 28,698 25,955
Total liabilities 3,121,427 3,010,732 2,849,731 2,910,741 2,912,218
Stockholders' equity:
Common stock 165 167 170 172 172
Surplus 96,587 99,156 105,825 110,976 112,436
Undivided profits 309,053 304,343 300,917 297,776 294,864
Accumulated other comprehensive income
Unrealized appreciation on AFS securities 257 582 501 388 439
Total stockholders' equity 406,062 404,248 407,413 409,312 407,911
Total liabilities and stockholders' equity $ 3,527,489 $ 3,414,980 $ 3,257,144 $ 3,320,053 $ 3,320,129
Simmons First National Corporation SFNC
Consolidated Average Quarter-to-Date Balance Sheets
For the Quarters Ended Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands)
ASSETS
Cash and non-interest bearing balances due from banks $ 43,691 $ 36,603 $ 35,899 $ 37,469 $ 35,132
Interest bearing balances due from banks 490,532 479,435 550,512 576,416 546,478
Federal funds sold 8,931 2,850 363 281 99
Cash and cash equivalents 543,154 518,888 586,774 614,166 581,709
Investment securities - held-to-maturity 511,203 496,102 508,293 496,002 501,812
Investment securities - available-for-sale 194,815 178,247 172,539 172,523 173,360
Mortgage loans held for sale 17,804 19,334 17,623 17,076 20,035
Assets held in trading accounts 7,701 7,780 7,831 6,845 7,375
Loans:
Not covered by FDIC loss share agreements 1,633,710 1,637,437 1,579,166 1,550,341 1,590,584
Acquired, not covered by FDIC loss share agreements
(net of discounts) 82,764 12,700 -- -- --
Covered by FDIC loss share agreements (net of discounts) 218,135 117,809 120,695 141,563 168,506
Allowance for loan losses (28,660) (29,228) (29,339) (30,896) (29,730)
Net loans 1,905,949 1,738,718 1,670,522 1,661,008 1,729,360
FDIC indemnification asset 66,994 39,476 38,563 44,845 50,180
Premises and equipment 87,784 85,173 85,629 86,187 86,881
Foreclosed assets not covered by FDIC loss share agreements 34,883 24,945 24,322 23,279 22,702
Foreclosed assets covered by FDIC loss share agreements 29,779 14,521 12,079 13,048 12,409
Interest receivable 15,154 13,484 12,877 13,847 16,071
Bank owned life insurance 51,864 51,507 51,133 50,761 50,362
Goodwill 60,605 60,605 60,605 60,605 60,605
Core deposit premiums 2,955 1,614 1,467 1,541 1,685
Other assets 3,574 14,991 15,114 17,952 18,562
Total assets $ 3,534,218 $ 3,265,385 $ 3,265,371 $ 3,279,685 $ 3,333,108
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing transaction accounts $ 570,800 $ 504,923 $ 502,884 $ 494,366 $ 535,663
Interest bearing transaction accounts and savings deposits 1,405,956 1,291,141 1,282,616 1,252,972 1,228,495
Time deposits less than $100,000 523,050 477,275 477,588 492,354 508,847
Time deposits greater than $100,000 380,843 361,504 360,233 371,168 388,470
Total deposits 2,880,649 2,634,843 2,623,321 2,610,860 2,661,475
Federal funds purchased and securities sold under agreements to repurchase 101,815 72,381 82,738 108,841 107,750
Other borrowings 89,617 90,307 89,606 89,920 91,552
Subordinated debentures 20,620 30,594 30,930 30,930 30,930
Accrued interest and other liabilities 33,227 30,219 29,077 27,417 31,303
Total liabilities 3,125,928 2,858,344 2,855,672 2,867,968 2,923,010
Total stockholders' equity 408,290 407,041 409,699 411,717 410,098
Total liabilities and stockholders' equity $ 3,534,218 $ 3,265,385 $ 3,265,371 $ 3,279,685 $ 3,333,108
Simmons First National Corporation SFNC
Consolidated Statements of Income - Quarter-to-Date
For the Quarters Ended Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands, except per share data)
INTEREST INCOME
Loans not covered by loss share agreements $ 23,912 $ 23,192 $ 22,358 $ 22,272 $ 23,370
Loans covered by FDIC loss share agreements 6,759 5,041 4,994 5,973 4,513
Federal funds sold 4 2 1 -- 1
Investment securities 3,106 3,027 3,313 3,275 3,568
Mortgage loans held for sale 149 171 164 153 198
Assets held in trading accounts 11 12 13 12 7
Interest bearing balances due from banks 301 267 349 303 324
TOTAL INTEREST INCOME 34,242 31,712 31,192 31,988 31,981
INTEREST EXPENSE
Time deposits 1,807 1,863 2,004 2,269 2,577
Other deposits 652 658 676 696 779
Federal funds purchased and securities sold under agreements to repurchase 65 69 77 99 118
Other borrowings 948 792 799 815 826
Subordinated debentures 163 389 385 391 384
TOTAL INTEREST EXPENSE 3,635 3,771 3,941 4,270 4,684
NET INTEREST INCOME 30,607 27,941 27,251 27,718 27,297
Provision for loan losses 1,295 1,299 775 771 2,831
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 29,312 26,642 26,476 26,947 24,466
NON-INTEREST INCOME
Trust income 1,484 1,440 1,240 1,309 1,416
Service charges on deposit accounts 4,645 4,368 3,930 3,865 4,289
Other service charges and fees 747 684 738 792 699
Mortgage lending income 1,553 1,705 1,445 1,294 1,464
Investment banking income 337 560 442 699 294
Credit card fees 4,655 4,104 4,207 4,079 4,318
Bank owned life insurance income 385 355 368 355 403
Gain on sale of securities 2 -- -- -- --
Gain on FDIC-assisted transactions 2,291 1,120 -- -- --
Net gain (loss) on assets covered by FDIC loss share agreements (2,286) (2,689) (2,153) (2,665) (826)
Other income 930 165 876 995 786
TOTAL NON-INTEREST INCOME 14,743 11,812 11,093 10,723 12,843
NON-INTEREST EXPENSE
Salaries and employee benefits 17,674 15,911 16,590 16,824 15,973
Occupancy expense, net 2,311 2,182 2,029 2,081 1,930
Furniture and equipment expense 1,835 1,835 1,608 1,604 1,721
Other real estate and foreclosure expense 311 280 194 207 146
Deposit insurance 614 444 457 571 295
Merger related costs 1,081 815 -- -- --
Other operating expenses 8,340 7,219 7,366 7,350 8,381
TOTAL NON-INTEREST EXPENSE 32,166 28,686 28,244 28,637 28,446
NET INCOME BEFORE INCOME TAXES 11,889 9,768 9,325 9,033 8,863
Provision for income taxes 3,856 3,008 2,789 2,678 2,558
NET INCOME $ 8,033 $ 6,760 $ 6,536 $ 6,355 $ 6,305
BASIC EARNINGS PER SHARE $ 0.48 $ 0.41 $ 0.38 $ 0.37 $ 0.37
DILUTED EARNINGS PER SHARE $ 0.48 $ 0.41 $ 0.38 $ 0.37 $ 0.37
Simmons First National Corporation SFNC
Consolidated Statements of Income - Year-to-Date
For the Quarters Ended Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands, except per share data)
INTEREST INCOME
Loans not covered by loss share agreements $ 91,734 $ 67,822 $ 44,630 $ 22,272 $ 95,713
Loans covered by FDIC loss share agreements 22,767 16,009 10,967 5,973 17,118
Federal funds sold 7 4 1 -- 6
Investment securities 12,721 9,615 6,588 3,275 14,583
Mortgage loans held for sale 637 487 317 153 503
Assets held in trading accounts 48 37 25 12 33
Interest bearing balances due from banks 1,220 919 652 303 1,100
TOTAL INTEREST INCOME 129,134 94,893 63,180 31,988 129,056
INTEREST EXPENSE
Time deposits 7,943 6,136 4,273 2,269 11,314
Other deposits 2,682 2,029 1,372 696 3,611
Federal funds purchased and securities sold under agreements to repurchase 310 248 176 99 450
Other borrowings 3,354 2,406 1,613 815 3,512
Subordinated debentures 1,328 1,166 777 391 1,509
TOTAL INTEREST EXPENSE 15,617 11,985 8,211 4,270 20,396
NET INTEREST INCOME 113,517 82,908 54,969 27,718 108,660
Provision for loan losses 4,140 2,846 1,546 771 11,676
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 109,377 80,062 53,423 26,947 96,984
NON-INTEREST INCOME
Trust income 5,473 3,988 2,549 1,309 5,375
Service charges on deposit accounts 16,808 12,163 7,795 3,865 16,808
Other service charges and fees 2,961 2,211 1,530 792 2,980
Mortgage lending income 5,997 4,441 2,739 1,294 4,188
Investment banking income 2,038 1,700 1,141 699 1,478
Credit card fees 17,045 12,390 8,286 4,079 16,828
Bank owned life insurance income 1,463 1,078 723 355 1,481
Gain on sale of securities 2 -- -- -- --
Gain on FDIC-assisted transactions 3,411 1,120 -- -- --
Net gain (loss) on assets covered by FDIC loss share agreements (9,793) (7,507) (4,818) (2,665) 154
Other income 2,966 2,037 1,871 995 4,173
TOTAL NON-INTEREST INCOME 48,371 33,621 21,816 10,723 53,465
NON-INTEREST EXPENSE
Salaries and employee benefits 66,999 49,323 33,414 16,824 65,058
Occupancy expense, net 8,603 6,291 4,110 2,081 8,443
Furniture and equipment expense 6,882 5,047 3,212 1,604 6,633
Other real estate and foreclosure expense 992 681 401 207 678
Deposit insurance 2,086 1,472 1,028 571 2,387
Merger related costs 1,896 815 -- -- 357
Other operating expenses 30,275 21,928 14,716 7,350 31,094
TOTAL NON-INTEREST EXPENSE 117,733 85,557 56,881 28,637 114,650
NET INCOME BEFORE INCOME TAXES 40,015 28,126 18,358 9,033 35,799
Provision for income taxes 12,331 8,475 5,467 2,678 10,425
NET INCOME $ 27,684 $ 19,651 $ 12,891 $ 6,355 $ 25,374
BASIC EARNINGS PER SHARE $ 1.64 $ 1.16 $ 0.75 $ 0.37 $ 1.47
DILUTED EARNINGS PER SHARE $ 1.64 $ 1.16 $ 0.75 $ 0.37 $ 1.47
Simmons First National Corporation SFNC
Consolidated Risk-Based Capital
For the Quarters Ended Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands)
Tier 1 capital
Stockholders' equity $ 406,062 $ 404,248 $ 407,413 $ 409,312 $ 407,911
Trust preferred securities, net allowable 20,000 20,000 30,000 30,000 30,000
Disallowed intangible assets, net of deferred tax (48,966) (48,053) (47,235) (47,607) (47,889)
Unrealized gain on AFS securities (257) (582) (501) (388) (439)
Total Tier 1 capital 376,839 375,613 389,677 391,317 389,583
Tier 2 capital
Qualifying unrealized gain on AFS equity securities 19 14 15 14 9
Qualifying allowance for loan losses 24,743 24,395 22,910 22,096 22,682
Total Tier 2 capital 24,762 24,409 22,925 22,110 22,691
Total risk-based capital $ 401,601 $ 400,022 $ 412,602 $ 413,427 $ 412,274
Risk weighted assets $ 1,974,800 $ 1,946,344 $ 1,825,808 $ 1,759,932 $ 1,805,585
Adjusted average assets for leverage ratio $ 3,484,504 $ 3,216,488 $ 3,217,291 $ 3,231,257 $ 3,284,379
Ratios at end of quarter
Equity to assets 11.51% 11.84% 12.51% 12.33% 12.29%
Tangible common equity to tangible assets 9.87% 10.18% 10.81% 10.66% 10.61%
Tier 1 leverage ratio 10.81% 11.68% 12.11% 12.11% 11.86%
Tier 1 risk-based capital ratio 19.08% 19.30% 21.34% 22.23% 21.58%
Total risk-based capital ratio 20.34% 20.55% 22.60% 23.49% 22.83%
Simmons First National Corporation SFNC
Consolidated Loans and Investments
For the Quarters Ended Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands)
Legacy Loan Portfolio - End of Period (1)
Consumer
Credit cards $ 185,536 $ 175,760 $ 176,325 $ 175,013 $ 189,970
Student loans 34,145 36,441 39,823 44,059 47,419
Other consumer 105,319 107,604 107,284 110,001 109,211
Total consumer 325,000 319,805 323,432 329,073 346,600
Real Estate
Construction 138,132 128,423 117,235 109,979 109,825
Single-family residential 356,907 355,976 355,978 349,009 355,094
Other commercial 568,166 546,224 550,418 537,807 536,372
Total real estate 1,063,205 1,030,623 1,023,631 996,795 1,001,291
Commercial
Commercial 141,336 138,719 140,868 144,772 141,422
Agricultural 93,805 130,727 122,245 69,598 85,728
Total commercial 235,141 269,446 263,113 214,370 227,150
Other 5,167 3,527 4,560 3,415 4,728
Total Loans $ 1,628,513 $ 1,623,401 $ 1,614,736 $ 1,543,653 $ 1,579,769
(1) Excludes all acquired loans, including those covered by FDIC loss share agreements.
Investment Securities - End of Period
Held-to-Maturity
U.S. Treasury $ -- $ -- $ -- $ 4,000 $ 4,000
U.S. Government agencies 288,098 303,640 315,493 267,991 308,779
Mortgage-backed securities 49 51 56 59 62
State and political subdivisions 207,374 206,319 209,043 208,334 211,673
Other securities 620 620 930 930 930
Total held-to-maturity 496,141 510,630 525,522 481,314 525,444
Available-for-Sale
U.S. Government agencies 152,481 164,467 148,837 157,631 153,627
Mortgage-backed securities 20,634 24,333 2,493 2,528 2,557
State and political subdivisions 2,988 -- -- -- --
FHLB stock 5,498 5,788 5,578 6,241 6,237
Other securities 9,741 10,463 10,058 10,066 9,791
Total available-for-sale 191,342 205,051 166,966 176,466 172,212
Total investment securities $ 687,483 $ 715,681 $ 692,488 $ 657,780 $ 697,656
Fair value - HTM investment securities $ 500,578 $ 516,419 $ 531,499 $ 486,743 $ 532,206
Investment Securities - QTD Average
Taxable securities $ 495,917 $ 467,988 $ 471,826 $ 459,164 $ 466,369
Tax exempt securities 210,101 206,361 209,006 209,361 208,803
Total investment securities - QTD average $ 706,018 $ 674,349 $ 680,832 $ 668,525 $ 675,172
Simmons First National Corporation SFNC
Consolidated Allowance and Asset Quality
For the Quarters Ended Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands)
Allowance for Loan Losses
Balance, beginning of quarter $ 28,145 $ 28,397 $ 28,325 $ 30,108 $ 29,151
Loans charged off
Credit cards 884 806 829 997 1,262
Other consumer 362 358 252 226 530
Real estate 705 773 78 2,539 885
Commercial 163 86 165 129 226
Total loans charged off 2,114 2,023 1,324 3,891 2,903
Recoveries of loans previously charged off
Credit cards 194 242 212 210 244
Other consumer 177 107 135 156 100
Real estate 144 61 248 930 436
Commercial 41 62 26 41 249
Total recoveries 556 472 621 1,337 1,029
Net loans charged off 1,558 1,551 703 2,554 1,874
Provision for loan losses 1,295 1,299 775 771 2,831
Balance, end of quarter $ 27,882 $ 28,145 $ 28,397 $ 28,325 $ 30,108
Non-performing assets (1) (2)
Non-performing loans
Nonaccrual loans
Real estate $ 7,135 $ 6,197 $ 6,851 $ 6,898 $ 10,315
Commercial 618 894 676 942 1,253
Consumer 1,370 1,389 1,462 1,299 1,339
Total nonaccrual loans 9,123 8,480 8,989 9,139 12,907
Loans past due 90 days or more
Government guaranteed student loans 2,234 2,324 3,275 3,434 2,483
Other loans 681 1,001 509 606 785
Total loans past due 90 days or more 2,915 3,325 3,784 4,040 3,268
Total non-performing loans 12,038 11,805 12,773 13,179 16,175
Other non-performing assets
Foreclosed assets held for sale 21,556 23,126 23,947 24,542 22,887
Acquired foreclosed assets held for sale, not covered by FDIC loss share agreements 11,796 6,539 -- -- --
Other non-performing assets 221 60 -- 1 --
Total other non-performing assets 33,573 29,725 23,947 24,543 22,887
Total non-performing assets $ 45,611 $ 41,530 $ 36,720 $ 37,722 $ 39,062
Performing TDRs (troubled debt restructurings) $ 11,015 $ 10,995 $ 11,492 $ 11,531 $ 11,391
Ratios (1) (2)
Allowance for loan losses to total loans 1.71% 1.73% 1.76% 1.83% 1.91%
Allowance for loan losses to non-performing loans 232% 238% 222% 215% 186%
Non-performing loans to total loans 0.74% 0.73% 0.79% 0.85% 1.02%
Non-performing assets (including performing TDRs) to total assets 1.61% 1.54% 1.48% 1.48% 1.52%
Non-performing assets to total assets 1.29% 1.22% 1.13% 1.14% 1.18%
Non-performing assets to total assets (excluding Gov't guaranteed student loans) 1.23% 1.15% 1.03% 1.03% 1.10%
Annualized net charge offs to total loans 0.38% 0.38% 0.18% 0.66% 0.47%
Annualized net credit card charge offs to total credit card loans 1.54% 1.27% 1.42% 1.75% 2.20%
Annualized net charge offs to total loans (excluding credit cards) 0.24% 0.27% 0.02% 0.52% 0.24%
Past due loans >30 days (excluding nonaccrual) 0.63% 0.75% 0.68% 0.83% 0.82%
Past due loans >30 days (excluding nonaccrual) (excluding Gov't guaranteed student loans) 0.44% 0.48% 0.42% 0.47% 0.56%
(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 Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
ASSETS
Earning Assets
Interest bearing balances due from banks 0.24% 0.22% 0.25% 0.21% 0.24%
Investment securities 2.39% 2.46% 2.66% 2.69% 2.81%
Mortgage loans held for sale 3.33% 3.52% 3.74% 3.60% 3.92%
Assets held in trading accounts 0.57% 0.61% 0.67% 0.71% 0.38%
Loans, including covered loans* 6.59% 6.40% 6.47% 6.72% 6.29%
Total interest earning assets 4.45% 4.45% 4.41% 4.51% 4.38%
LIABILITIES
Interest bearing liabilities
Interest bearing transaction and savings accounts 0.18% 0.20% 0.21% 0.22% 0.25%
Time deposits 0.80% 0.88% 0.96% 1.06% 1.14%
Total interest bearing deposits 0.42% 0.47% 0.51% 0.56% 0.63%
Federal funds purchased and securities sold under agreement to repurchase 0.25% 0.38% 0.37% 0.37% 0.43%
Other borrowings 4.21% 3.49% 3.59% 3.65% 3.58%
Subordinated debentures 3.14% 5.06% 5.01% 5.08% 4.93%
Total interest bearing liabilities 0.57% 0.65% 0.68% 0.73% 0.79%
NET INTEREST MARGIN/SPREAD
Net interest spread 3.88% 3.80% 3.73% 3.78% 3.59%
Net interest margin - quarter-to-date 3.99% 3.94% 3.87% 3.93% 3.76%
Net interest margin - year-to-date 3.93% 3.91% 3.90% 3.93% 3.85%
* Covered loans are loans covered by FDIC loss share agreements.
Simmons First National Corporation SFNC
Consolidated - Selected Financial Data
For the Quarters Ended Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands, except share data)
QUARTER-TO-DATE
Diluted earnings per share $ 0.48 $ 0.41 $ 0.38 $ 0.37 $ 0.37
Core earnings (excludes nonrecurring items) (non-GAAP) 7,404 6,575 6,536 6,355 6,305
Diluted core earnings per share (non-GAAP) 0.44 0.40 0.38 0.37 0.37
Cash dividends declared per common share 0.20 0.20 0.20 0.20 0.19
Cash dividends declared - amount 3,323 3,334 3,395 3,444 3,271
Return on average stockholders' equity 7.83% 6.61% 6.42% 6.21% 6.10%
Return on tangible equity 9.36% 7.85% 7.61% 7.36% 7.34%
Return on average assets 0.90% 0.82% 0.81% 0.78% 0.75%
Net interest margin (FTE) 3.99% 3.94% 3.87% 3.93% 3.76%
FTE adjustment - investments 1,134 1,138 1,196 1,192 1,219
FTE adjustment - loans 11 11 12 11 12
Amortization of intangibles 126 74 74 74 214
Amortization of intangibles, net of taxes 77 45 45 45 130
Average shares outstanding 16,624,637 16,756,589 17,044,160 17,215,027 17,250,718
Average earning assets 3,165,595 2,938,994 2,957,022 2,961,047 3,008,249
Average interest bearing liabilities 2,521,901 2,323,202 2,323,711 2,346,185 2,356,044
YEAR-TO-DATE
Diluted earnings per share $ 1.64 $ 1.16 $ 0.75 $ 0.37 $ 1.47
Core earnings (excludes nonrecurring items) (non-GAAP) 26,870 19,466 12,891 6,355 24,988
Diluted core earnings per share (non-GAAP) 1.59 1.15 0.75 0.37 1.45
Cash dividends declared per common share 0.80 0.60 0.40 0.20 0.76
Cash dividends declared - amount 13,496 10,173 6,839 3,444 13,156
Return on average stockholders' equity 6.77% 6.41% 6.31% 6.21% 6.25%
Return on tangible equity 8.05% 7.61% 7.49% 7.36% 7.54%
Return on average assets 0.83% 0.80% 0.79% 0.78% 0.77%
Net interest margin (FTE) 3.93% 3.91% 3.90% 3.93% 3.85%
FTE adjustment - investments 4,660 3,526 2,388 1,192 4,920
FTE adjustment - loans 45 34 23 11 50
Amortization of intangibles 348 222 148 74 884
Amortization of intangibles, net of taxes 212 135 90 45 537
Average shares outstanding 16,908,904 17,004,351 17,129,593 17,215,027 17,309,488
Average diluted shares outstanding 16,911,363 17,007,623 17,134,232 17,223,085 17,317,850
Average earning assets 3,008,840 2,952,324 2,959,034 2,961,047 2,954,285
Average interest bearing liabilities 2,378,748 2,331,032 2,334,948 2,346,185 2,362,028
END OF PERIOD
Book value per share $ 24.55 $ 24.26 $ 24.03 $ 23.82 $ 23.70
Tangible book value per share 20.66 20.47 20.37 20.21 20.09
Shares outstanding 16,542,778 16,660,278 16,956,991 17,182,526 17,212,317
Full-time equivalent employees 1,068 1,073 1,074 1,077 1,083
Total number of ATM's 110 106 102 102 102
Total number of financial centers 92 88 84 84 84
Parent company only - investment in subsidiaries 368,847 387,944 386,441 384,713 381,236
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 Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(Unaudited) 2012 2012 2012 2012 2011
(in thousands, except per share data)
QUARTER-TO-DATE
Net Income $ 8,033 $ 6,760 $ 6,536 $ 6,355 $ 6,305
Nonrecurring items
Gain on FDIC assisted transactions (2,291) (1,120) -- -- --
Merger related costs 1,081 815 -- -- --
FHLB prepayment penalties 175 -- -- -- --
Tax effect 406 120 -- -- --
Net nonrecurring items (629) (185) -- -- --
Core earnings (non-GAAP) $ 7,404 $ 6,575 $ 6,536 $ 6,355 $ 6,305
Diluted earnings per share $ 0.48 $ 0.41 $ 0.38 $ 0.37 $ 0.37
Nonrecurring items
Gain on FDIC assisted transactions (0.14) (0.07) -- -- --
Merger related costs 0.07 0.05 -- -- --
FHLB prepayment penalties 0.01 -- -- -- --
Tax effect 0.02 0.01 -- -- --
Net nonrecurring items (0.04) (0.01) -- -- --
Diluted core earnings per share (non-GAAP) $ 0.44 $ 0.40 $ 0.38 $ 0.37 $ 0.37
YEAR-TO-DATE
Net Income $ 27,684 $ 19,651 $ 12,891 $ 6,355 $ 25,374
Nonrecurring items
Gain on sale of MasterCard stock (1) -- -- -- -- (1,132)
Gain on FDIC assisted transactions (3,411) (1,120) -- -- --
Merger related costs 1,896 815 -- -- 357
FHLB prepayment penalties 175 -- -- -- --
Branch right sizing -- -- -- -- 141
Tax effect 526 120 -- -- 248
Net nonrecurring items (814) (185) -- -- (386)
Core earnings (non-GAAP) $ 26,870 $ 19,466 $ 12,891 $ 6,355 $ 24,988
Diluted earnings per share $ 1.64 $ 1.16 $ 0.75 $ 0.37 $ 1.47
Nonrecurring items
Gain on sale of MasterCard stock (1) -- -- -- -- (0.07)
Gain on FDIC assisted transactions (0.21) (0.07) -- -- --
Merger related costs 0.12 0.05 -- -- 0.02
FHLB prepayment penalties 0.01 -- -- -- --
Branch right sizing -- -- -- -- 0.01
Tax effect 0.03 0.01 -- -- 0.02
Net nonrecurring items (0.05) (0.01) -- -- (0.02)
Diluted core earnings per share (non-GAAP) $ 1.59 $ 1.15 $ 0.75 $ 0.37 $ 1.45
(1) Gain from liquidation of Class B shares received as part of MasterCard's 2006 IPO.

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

Source:Simmons First National Corporation