×

Simmons First Announces Second Quarter Earnings

PINE BLUFF, Ark., July 18, 2013 (GLOBE NEWSWIRE) -- Simmons First National Corporation (Nasdaq:SFNC) today announced second quarter 2013 net income of $6.6 million and diluted earnings per share of $0.40, an increase of $0.02, or 5.3%, compared to the same quarter last year. Year-to-date net income was $12.5 million, or $0.76 diluted earnings per share, an increase of $0.01 the same period last year.

"Considering interest rates continue at historical lows, we were pleased with our 5.3% quarterly EPS increase. More so, we were pleased with the positive trends in our balance sheet, as reflected in our normalized organic loan growth of approximately 3%, which enabled us to produce a net interest margin of 3.96%. The organic loan growth, coupled with strong asset quality, bodes well for the balance of the year," commented George A. Makris, Jr., CEO-Elect.

Loans

Total loans, including those acquired, were $1.9 billion at June 30, 2013, an increase of $149.7 million, or 8.8%, compared to the same period in 2012. Loans acquired in FDIC-assisted acquisitions grew $113.0 million, net of discounts, and legacy loans (excluding acquired loans) grew $35.7 million. "This was the third consecutive quarter of organic loan growth. While still 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 Makris.

Deposits

At June 30, 2013, total deposits were $2.8 billion, an increase of $183.8 million, or 7.0%, compared to the same period in 2012. Total non-time deposits totaled $2.0 billion, or 71% of total deposits.

Net Interest Income

The Company's net interest income for the second quarter of 2013 was $29.6 million, an increase of $2.3 million, or 8.6%, from the same period of 2012. Net interest margin was 3.96% for the quarter ended June 30, 2013. Included in interest income for both periods was the additional yield accretion recognized as a result of updated estimates of the cash flows of the 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 Six Months Ended
(In thousands) June 30 June 30
2013 2012 2013 2012
Impact on net interest income $ 3,150 $ 3,004 $ 6,097 $ 6,189
Non-interest income (3,062) (2,737) (5,890) (5,516)
Net impact to pre-tax income $ 88 $ 267 $ 207 $ 673

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 $19.5 million and the remaining adjustment to the indemnification assets that will reduce non-interest income is $16.9 million. Of the remaining adjustments, we expect to recognize $5.5 million of interest income and a $5.5 million reduction of non-interest income during the remainder of 2013, resulting in no impact to pre-tax income. 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 second quarter was $11.3 million, an increase of $180,000, or 1.6%, compared to the second quarter of 2012.

Non-Interest Expense

Non-interest expense for the second quarter of 2013 was $30.3 million, an increase of $2.1 million compared to the same period in 2012. "Included in the quarter were $1.9 million in normal operating expenses attributable to our 2012 FDIC-assisted acquisitions. Normalized for these acquisition related expenses, non-interest expense for the quarter increased by only 0.8%. Obviously, we continue to have excellent expense control as a result of the implementation of our efficiency initiatives," added Makris.

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 June 30, 2013, acquired loans covered by loss share were carried at $164 million, OREO covered by loss share was carried at $23 million and the FDIC loss share indemnification asset was carried at $68 million. Acquired loans and OREO not covered by loss share were carried at $64 million and $9 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 $27.4 million at June 30, 2013, or 1.66% of total loans and 292% of non-performing loans. Non-performing loans as a percent of total loans were 0.57% as of June 30, 2013, down 17 basis points from December 31, 2012. "On a linked quarter basis, our non-performing assets decreased $2.8 million. Included in our non-performing assets was $8.6 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 as a percent of total assets was 0.92% as of June 30, 2013, which continues to compare favorably to the industry and our peer group," commented Makris. For the second quarter, the annualized net charge-off ratio, excluding credit cards, was 0.23%, and the annualized credit card charge-off ratio was 1.25%.

Capital

At June 30, 2013, stockholders' equity was $402 million, book value per share was $24.67 and tangible book value per share was $20.74. The Company's ratio of stockholders' equity to total assets was 11.7% and its ratio of tangible common equity to tangible assets was 10.1%, as of June 30, 2013.

"Our exceptional level of capital allows us to actively pursue the right opportunities that meet our strategic plan regarding mergers and acquisitions," continued Makris. As of June 30, 2013, the Company's regulatory capital ratios remain significantly higher than regulatory "well capitalized" guidelines:

"Well Capitalized" SFNC
Tier 1 Leverage Ratio 5.00% 10.95%
Tier 1 Risk-Based Capital Ratio 6.00% 18.99%
Total Risk-Based Capital Ratio 10.00% 20.24%

Stock Repurchase Program

Through the second quarter of 2013, the Company has repurchased approximately 327,000 shares at an average price of $25.50. 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. The Company's common stock trades on the NASDAQ Global Select Market under the symbol "SFNC".

Conference Call

Management will conduct a conference call to review this information beginning at 3:00 p.m. Central Time on Thursday, July 18, 2013. Interested persons can listen to this call by dialing toll-free 1-888-510-1765 (United States and Canada only) and asking for the Simmons First National Corporation conference call, conference ID 6573031. 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 Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
(in thousands)
ASSETS
Cash and non-interest bearing balances due from banks $ 38,494 $ 40,006 $ 47,470 $ 40,356 $ 29,708
Interest bearing balances due from banks 420,740 602,992 467,984 440,524 515,874
Federal funds sold -- -- 22,343 7,571 --
Cash and cash equivalents 459,234 642,998 537,797 488,451 545,582
Investment securities - held-to-maturity 555,464 488,513 496,141 510,630 525,522
Investment securities - available-for-sale 177,531 192,165 191,342 205,051 166,966
Mortgage loans held for sale 14,454 19,100 25,367 23,980 15,495
Assets held in trading accounts 8,739 8,368 6,224 7,002 7,812
Loans:
Loans 1,650,395 1,589,077 1,628,513 1,623,401 1,614,736
Allowance for loan losses (27,398) (27,735) (27,882) (28,145) (28,397)
Loans acquired, not covered by FDIC loss share
(net of discount) 63,500 78,745 82,764 73,023 --
Loans acquired, covered by FDIC loss share (net of discount) 163,736 181,537 210,842 163,657 114,189
Net loans 1,850,233 1,821,624 1,894,237 1,831,936 1,700,528
FDIC indemnification asset 67,744 71,002 75,286 59,547 35,038
Premises and equipment 88,164 87,934 87,557 85,969 85,171
Foreclosed assets not covered by FDIC loss share 30,390 30,714 33,352 29,665 23,947
Foreclosed assets covered by FDIC loss share 22,990 28,003 27,620 26,466 11,252
Interest receivable 12,637 13,027 14,530 15,253 12,975
Bank owned life insurance 59,710 59,344 52,066 51,681 51,326
Goodwill 60,605 60,605 60,605 60,605 60,605
Core deposit premiums 3,487 3,624 3,760 2,549 1,431
Other assets 10,387 16,540 21,605 16,195 13,494
Total assets $ 3,421,769 $ 3,543,561 $ 3,527,489 $ 3,414,980 $ 3,257,144
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing transaction accounts $ 565,433 $ 592,442 $ 576,655 $ 543,380 $ 517,854
Interest bearing transaction accounts and savings deposits 1,428,422 1,456,005 1,421,137 1,343,784 1,290,954
Time deposits less than $100,000 467,778 482,688 505,773 521,259 467,503
Time deposits greater than $100,000 351,486 361,529 370,598 386,872 352,973
Total deposits 2,813,119 2,892,664 2,874,163 2,795,295 2,629,284
Federal funds purchased and securities sold under agreements to repurchase 79,063 108,227 104,078 64,829 70,220
Other borrowings 77,659 81,646 89,441 88,852 90,866
Subordinated debentures 20,620 20,620 20,620 20,620 30,930
Accrued interest and other liabilities 29,458 33,950 33,125 41,136 28,431
Total liabilities 3,019,919 3,137,107 3,121,427 3,010,732 2,849,731
Stockholders' equity:
Common stock 163 165 165 167 170
Surplus 89,434 94,723 96,587 99,156 105,825
Undivided profits 314,663 311,521 309,053 304,343 300,917
Accumulated other comprehensive income
Unrealized appreciation on AFS securities (2,410) 45 257 582 501
Total stockholders' equity 401,850 406,454 406,062 404,248 407,413
Total liabilities and stockholders' equity $ 3,421,769 $ 3,543,561 $ 3,527,489 $ 3,414,980 $ 3,257,144
Simmons First National Corporation SFNC
Consolidated Average Quarter-to-Date Balance Sheets
For the Quarters Ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
(in thousands)
ASSETS
Cash and non-interest bearing balances due from banks $ 41,030 $ 42,334 $ 43,691 $ 36,603 $ 35,899
Interest bearing balances due from banks 527,787 560,759 490,532 479,435 550,512
Federal funds sold 1,922 8,487 8,931 2,850 363
Cash and cash equivalents 570,739 611,580 543,154 518,888 586,774
Investment securities - held-to-maturity 511,008 497,152 511,203 496,102 508,293
Investment securities - available-for-sale 182,227 191,981 194,815 178,247 172,539
Mortgage loans held for sale 14,154 19,442 17,804 19,334 17,623
Assets held in trading accounts 8,292 8,525 7,701 7,780 7,831
Loans:
Loans 1,616,036 1,588,299 1,633,710 1,637,437 1,579,166
Allowance for loan losses (28,219) (27,999) (28,660) (29,228) (29,339)
Loans acquired, not covered by FDIC loss share
(net of discount) 72,663 80,755 82,764 12,700 --
Loans acquired, covered by FDIC loss share (net of discount) 172,415 196,190 218,135 117,809 120,695
Net loans 1,832,895 1,837,245 1,905,949 1,738,718 1,670,522
FDIC indemnification asset 70,442 74,205 66,994 39,476 38,563
Premises and equipment 88,210 87,571 87,784 85,173 85,629
Foreclosed assets not covered by FDIC loss share 29,399 32,102 34,883 24,945 24,322
Foreclosed assets covered by FDIC loss share 25,603 27,812 29,779 14,521 12,079
Interest receivable 12,524 13,370 15,154 13,484 12,877
Bank owned life insurance 59,523 52,706 51,864 51,507 51,133
Goodwill 60,605 60,605 60,605 60,605 60,605
Core deposit premiums 3,554 3,693 2,955 1,614 1,467
Other assets 13,435 20,827 3,574 14,991 15,114
Total assets $ 3,482,610 $ 3,538,816 $ 3,534,218 $ 3,265,385 $ 3,265,371
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing transaction accounts $ 560,804 $ 567,588 $ 570,800 $ 504,923 $ 502,884
Interest bearing transaction accounts and savings deposits 1,456,258 1,446,533 1,405,956 1,291,141 1,282,616
Time deposits less than $100,000 475,428 494,196 523,050 477,275 477,588
Time deposits greater than $100,000 359,155 364,496 380,843 361,504 360,233
Total deposits 2,851,645 2,872,813 2,880,649 2,634,843 2,623,321
Federal funds purchased and securities sold under agreements to repurchase 89,879 118,131 101,815 72,381 82,738
Other borrowings 80,090 83,872 89,617 90,307 89,606
Subordinated debentures 20,620 20,620 20,620 30,594 30,930
Accrued interest and other liabilities 32,146 34,486 33,227 30,219 29,077
Total liabilities 3,074,380 3,129,922 3,125,928 2,858,344 2,855,672
Total stockholders' equity 408,230 408,894 408,290 407,041 409,699
Total liabilities and stockholders' equity $ 3,482,610 $ 3,538,816 $ 3,534,218 $ 3,265,385 $ 3,265,371
Simmons First National Corporation SFNC
Consolidated Statements of Income - Quarter-to-Date
For the Quarters Ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
(in thousands, except per share data)
INTEREST INCOME
Loans not covered by loss share $ 22,602 $ 23,696 $ 23,912 $ 23,192 $ 22,358
Loans covered by FDIC loss share 6,469 6,175 6,759 5,041 4,994
Federal funds sold 5 3 4 2 1
Investment securities 3,019 2,902 3,106 3,027 3,313
Mortgage loans held for sale 118 155 149 171 164
Assets held in trading accounts 6 11 11 12 13
Interest bearing balances due from banks 352 290 301 267 349
TOTAL INTEREST INCOME 32,571 33,232 34,242 31,712 31,192
INTEREST EXPENSE
Time deposits 1,479 1,588 1,807 1,863 2,004
Other deposits 603 611 652 658 676
Federal funds purchased and securities sold under agreements to repurchase 53 65 65 69 77
Other borrowings 692 734 948 792 799
Subordinated debentures 162 159 163 389 385
TOTAL INTEREST EXPENSE 2,989 3,157 3,635 3,771 3,941
NET INTEREST INCOME 29,582 30,075 30,607 27,941 27,251
Provision for loan losses 1,034 919 1,295 1,299 775
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 28,548 29,156 29,312 26,642 26,476
NON-INTEREST INCOME
Trust income 1,342 1,444 1,484 1,440 1,240
Service charges on deposit accounts 4,474 4,241 4,645 4,368 3,930
Other service charges and fees 791 775 747 684 738
Mortgage lending income 1,338 1,216 1,553 1,705 1,445
Investment banking income 696 454 337 560 442
Credit card fees 4,341 4,039 4,655 4,104 4,207
Bank owned life insurance income 366 278 385 355 368
Gain on sale of securities, net (193) -- 2 -- --
Gain on FDIC-assisted transactions -- -- 2,291 1,120 --
Net (loss) gain on assets covered by FDIC loss share agreements (2,615) (2,142) (2,286) (2,689) (2,153)
Other income 733 1,008 930 165 876
TOTAL NON-INTEREST INCOME 11,273 11,313 14,743 11,812 11,093
NON-INTEREST EXPENSE
Salaries and employee benefits 17,937 18,507 17,674 15,911 16,590
Occupancy expense, net 2,450 2,555 2,311 2,182 2,029
Furniture and equipment expense 2,030 1,723 1,835 1,835 1,608
Other real estate and foreclosure expense 59 331 311 280 194
Deposit insurance 492 775 614 444 457
Merger related costs (467) 240 1,081 815 --
Other operating expenses 7,818 7,781 8,340 7,219 7,366
TOTAL NON-INTEREST EXPENSE 30,319 31,912 32,166 28,686 28,244
NET INCOME BEFORE INCOME TAXES 9,502 8,557 11,889 9,768 9,325
Provision for income taxes 2,926 2,620 3,856 3,008 2,789
NET INCOME $ 6,576 $ 5,937 $ 8,033 $ 6,760 $ 6,536
BASIC EARNINGS PER SHARE $ 0.40 $ 0.36 $ 0.48 $ 0.41 $ 0.38
DILUTED EARNINGS PER SHARE $ 0.40 $ 0.36 $ 0.48 $ 0.41 $ 0.38
Simmons First National Corporation SFNC
Consolidated Statements of Income - Year-to-Date
For the Quarters Ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
(in thousands, except per share data)
INTEREST INCOME
Loans not covered by loss share $ 46,298 $ 23,696 $ 91,734 $ 67,822 $ 44,630
Loans covered by FDIC loss share 12,644 6,175 22,767 16,009 10,967
Federal funds sold 8 3 7 4 1
Investment securities 5,921 2,902 12,721 9,615 6,588
Mortgage loans held for sale 273 155 637 487 317
Assets held in trading accounts 17 11 48 37 25
Interest bearing balances due from banks 642 290 1,220 919 652
TOTAL INTEREST INCOME 65,803 33,232 129,134 94,893 63,180
INTEREST EXPENSE
Time deposits 3,067 1,588 7,943 6,136 4,273
Other deposits 1,214 611 2,682 2,029 1,372
Federal funds purchased and securities sold under agreements to repurchase 118 65 310 248 176
Other borrowings 1,426 734 3,354 2,406 1,613
Subordinated debentures 321 159 1,328 1,166 777
TOTAL INTEREST EXPENSE 6,146 3,157 15,617 11,985 8,211
NET INTEREST INCOME 59,657 30,075 113,517 82,908 54,969
Provision for loan losses 1,953 919 4,140 2,846 1,546
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 57,704 29,156 109,377 80,062 53,423
NON-INTEREST INCOME
Trust income 2,786 1,444 5,473 3,988 2,549
Service charges on deposit accounts 8,715 4,241 16,808 12,163 7,795
Other service charges and fees 1,566 775 2,961 2,211 1,530
Mortgage lending income 2,554 1,216 5,997 4,441 2,739
Investment banking income 1,150 454 2,038 1,700 1,141
Credit card fees 8,380 4,039 17,045 12,390 8,286
Bank owned life insurance income 644 278 1,463 1,078 723
Gain on sale of securities, net (193) -- 2 -- --
Gain on FDIC-assisted transactions -- -- 3,411 1,120 --
Net (loss) gain on assets covered by FDIC loss share agreements (4,757) (2,142) (9,793) (7,507) (4,818)
Other income 1,741 1,008 2,966 2,037 1,871
TOTAL NON-INTEREST INCOME 22,586 11,313 48,371 33,621 21,816
NON-INTEREST EXPENSE
Salaries and employee benefits 36,444 18,507 66,999 49,323 33,414
Occupancy expense, net 5,005 2,555 8,603 6,291 4,110
Furniture and equipment expense 3,753 1,723 6,882 5,047 3,212
Other real estate and foreclosure expense 390 331 992 681 401
Deposit insurance 1,267 775 2,086 1,472 1,028
Merger related costs (227) 240 1,896 815 --
Other operating expenses 15,599 7,781 30,275 21,928 14,716
TOTAL NON-INTEREST EXPENSE 62,231 31,912 117,733 85,557 56,881
NET INCOME BEFORE INCOME TAXES 18,059 8,557 40,015 28,126 18,358
Provision for income taxes 5,546 2,620 12,331 8,475 5,467
NET INCOME $ 12,513 $ 5,937 $ 27,684 $ 19,651 $ 12,891
BASIC EARNINGS PER SHARE $ 0.76 $ 0.36 $ 1.64 $ 1.16 $ 0.75
DILUTED EARNINGS PER SHARE $ 0.76 $ 0.36 $ 1.64 $ 1.16 $ 0.75
Simmons First National Corporation SFNC
Consolidated Risk-Based Capital
For the Quarters Ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
(in thousands)
Tier 1 capital
Stockholders' equity $ 401,850 $ 406,454 $ 406,062 $ 404,248 $ 407,413
Trust preferred securities, net allowable 20,000 20,000 20,000 20,000 30,000
Disallowed intangible assets, net of deferred tax (48,091) (48,529) (48,966) (48,053) (47,235)
Unrealized gain on AFS securities 2,410 (45) (257) (582) (501)
Total Tier 1 capital 376,169 377,880 376,839 375,613 389,677
Tier 2 capital
Qualifying unrealized gain on AFS equity securities 35 28 19 14 15
Qualifying allowance for loan losses 24,818 24,129 24,743 24,395 22,910
Total Tier 2 capital 24,853 24,157 24,762 24,409 22,925
Total risk-based capital $ 401,022 $ 402,037 $ 401,601 $ 400,022 $ 412,602
Risk weighted assets $ 1,981,341 $ 1,925,199 $ 1,974,800 $ 1,946,344 $ 1,825,808
Adjusted average assets for leverage ratio $ 3,434,844 $ 3,490,102 $ 3,484,504 $ 3,216,488 $ 3,217,291
Ratios at end of quarter
Equity to assets 11.74% 11.47% 11.51% 11.84% 12.51%
Tangible common equity to tangible assets 10.06% 9.84% 9.87% 10.18% 10.81%
Tier 1 leverage ratio 10.95% 10.83% 10.81% 11.68% 12.11%
Tier 1 risk-based capital ratio 18.99% 19.63% 19.08% 19.30% 21.34%
Total risk-based capital ratio 20.24% 20.88% 20.34% 20.55% 22.60%
Simmons First National Corporation SFNC
Consolidated Loans and Investments
For the Quarters Ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
(in thousands)
Legacy Loan Portfolio - End of Period (1)
Consumer
Credit cards $ 173,536 $ 171,599 $ 185,536 $ 175,760 $ 176,325
Student loans 30,106 31,835 34,145 36,441 39,823
Other consumer 103,765 102,297 105,319 107,604 107,284
Total consumer 307,407 305,731 325,000 319,805 323,432
Real Estate
Construction 142,902 136,099 138,132 128,423 117,235
Single-family residential 364,239 355,479 356,907 355,976 355,978
Other commercial 572,110 569,686 568,166 546,224 550,418
Total real estate 1,079,251 1,061,264 1,063,205 1,030,623 1,023,631
Commercial
Commercial 152,122 150,427 141,336 138,719 140,868
Agricultural 107,113 68,028 93,805 130,727 122,245
Total commercial 259,235 218,455 235,141 269,446 263,113
Other 4,502 3,627 5,167 3,527 4,560
Total Loans $ 1,650,395 $ 1,589,077 $ 1,628,513 $ 1,623,401 $ 1,614,736
(1) Excludes all acquired loans, including those covered by FDIC loss share agreements.
Investment Securities - End of Period
Held-to-Maturity
U.S. Treasury $ -- $ -- $ -- $ -- $ --
U.S. Government agencies 313,050 288,480 288,098 303,640 315,493
Mortgage-backed securities 43 45 49 51 56
State and political subdivisions 241,751 199,368 207,374 206,319 209,043
Other securities 620 620 620 620 930
Total held-to-maturity 555,464 488,513 496,141 510,630 525,522
Available-for-Sale
U.S. Government agencies 159,390 159,846 152,481 164,467 148,837
Mortgage-backed securities 2,078 15,891 20,634 24,333 2,493
State and political subdivisions 1,262 1,417 2,988 -- --
FHLB stock 5,353 5,325 5,498 5,788 5,578
Other securities 9,448 9,686 9,741 10,463 10,058
Total available-for-sale 177,531 192,165 191,342 205,051 166,966
Total investment securities $ 732,995 $ 680,678 $ 687,483 $ 715,681 $ 692,488
Fair value - HTM investment securities $ 543,154 $ 491,556 $ 500,578 $ 516,419 $ 531,499
Investment Securities - QTD Average
Taxable securities $ 478,946 $ 485,711 $ 495,917 $ 467,988 $ 471,826
Tax exempt securities 214,289 203,422 210,101 206,361 209,006
Total investment securities - QTD average $ 693,235 $ 689,133 $ 706,018 $ 674,349 $ 680,832
Simmons First National Corporation SFNC
Consolidated Allowance and Asset Quality
For the Quarters Ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
(in thousands)
Allowance for Loan Losses
Balance, beginning of quarter $ 27,735 $ 27,882 $ 28,145 $ 28,397 $ 28,325
Loans charged off
Credit cards 743 909 884 806 829
Other consumer 310 374 362 358 252
Real estate 887 239 705 773 78
Commercial 133 96 163 86 165
Total loans charged off 2,073 1,618 2,114 2,023 1,324
Recoveries of loans previously charged off
Credit cards 204 236 194 242 212
Other consumer 116 195 177 107 135
Real estate 295 68 144 61 248
Commercial 87 53 41 62 26
Total recoveries 702 552 556 472 621
Net loans charged off 1,371 1,066 1,558 1,551 703
Provision for loan losses 1,034 919 1,295 1,299 775
Balance, end of quarter $ 27,398 $ 27,735 $ 27,882 $ 28,145 $ 28,397
Non-performing assets (1) (2)
Non-performing loans
Nonaccrual loans
Real estate $ 4,305 $ 6,963 $ 7,135 $ 6,197 $ 6,851
Commercial 526 602 618 894 676
Consumer 1,410 1,203 1,370 1,389 1,462
Total nonaccrual loans 6,241 8,768 9,123 8,480 8,989
Loans past due 90 days or more
Government guaranteed student loans 2,254 2,283 2,234 2,324 3,275
Other loans 879 661 681 1,001 509
Total loans past due 90 days or more 3,133 2,944 2,915 3,325 3,784
Total non-performing loans 9,374 11,712 12,038 11,805 12,773
Other non-performing assets
Foreclosed assets held for sale 21,804 21,253 21,556 23,126 23,947
Acquired foreclosed assets held for sale, not covered by FDIC loss share agreements 8,586 9,461 11,796 6,539
Other non-performing assets 80 238 221 60 --
Total other non-performing assets 30,470 30,952 33,573 29,725 23,947
Total non-performing assets $ 39,844 $ 42,664 $ 45,611 $ 41,530 $ 36,720
Performing TDRs (troubled debt restructurings) $ 10,473 $ 10,745 $ 11,015 $ 10,995 $ 11,492
Ratios (1) (2)
Allowance for loan losses to total loans 1.66% 1.75% 1.71% 1.73% 1.76%
Allowance for loan losses to non-performing loans 292% 237% 232% 238% 222%
Non-performing loans to total loans 0.57% 0.74% 0.74% 0.73% 0.79%
Non-performing assets (including performing TDRs) to total assets 1.47% 1.51% 1.61% 1.54% 1.48%
Non-performing assets to total assets 1.16% 1.20% 1.29% 1.22% 1.13%
Non-performing assets to total assets (excluding Gov't guaranteed student loans) 1.10% 1.14% 1.23% 1.15% 1.03%
Annualized net charge offs to total loans 0.34% 0.27% 0.38% 0.38% 0.18%
Annualized net credit card charge offs to total credit card loans 1.25% 1.53% 1.54% 1.27% 1.42%
Annualized net charge offs to total loans (excluding credit cards) 0.23% 0.11% 0.24% 0.27% 0.02%
Past due loans >30 days (excluding nonaccrual) 0.54% 0.64% 0.63% 0.75% 0.68%
Past due loans >30 days (excluding nonaccrual) (excluding Gov't guaranteed student loans) 0.35% 0.40% 0.44% 0.48% 0.42%
(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 Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
ASSETS
Earning Assets
Interest bearing balances due from banks 0.27% 0.21% 0.24% 0.22% 0.25%
Investment securities 2.37% 2.33% 2.39% 2.46% 2.66%
Mortgage loans held for sale 3.34% 3.23% 3.33% 3.52% 3.74%
Assets held in trading accounts 0.29% 0.52% 0.57% 0.61% 0.67%
Loans, including covered loans* 6.27% 6.50% 6.31% 6.36% 6.47%
Total interest earning assets 4.35% 4.41% 4.45% 4.45% 4.41%
LIABILITIES
Interest bearing liabilities
Interest bearing transaction and savings accounts 0.17% 0.17% 0.18% 0.20% 0.21%
Time deposits 0.71% 0.75% 0.80% 0.88% 0.96%
Total interest bearing deposits 0.36% 0.39% 0.42% 0.47% 0.51%
Federal funds purchased and securities sold under agreement to repurchase 0.24% 0.22% 0.25% 0.38% 0.37%
Other borrowings 3.47% 3.55% 4.21% 3.49% 3.59%
Subordinated debentures 3.15% 3.13% 3.14% 5.06% 5.01%
Total interest bearing liabilities 0.48% 0.51% 0.57% 0.65% 0.68%
NET INTEREST MARGIN/SPREAD
Net interest spread 3.87% 3.90% 3.88% 3.80% 3.73%
Net interest margin - quarter-to-date 3.96% 4.01% 3.99% 3.94% 3.87%
Net interest margin - year-to-date 3.98% 4.01% 3.93% 3.91% 3.90%
* Covered loans are loans covered by FDIC loss share agreements.
Simmons First National Corporation SFNC
Consolidated - Selected Financial Data
For the Quarters Ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
($ in thousands, except share data)
QUARTER-TO-DATE
Diluted earnings per share $ 0.40 $ 0.36 $ 0.48 $ 0.41 $ 0.38
Core earnings (excludes nonrecurring items) (non-GAAP) 6,409 6,083 7,404 6,575 6,536
Diluted core earnings per share (non-GAAP) 0.39 0.37 0.44 0.40 0.38
Cash dividends declared per common share 0.21 0.21 0.20 0.20 0.20
Cash dividends declared - amount 3,434 3,469 3,323 3,334 3,395
Return on average stockholders' equity 6.46% 5.89% 7.83% 6.61% 6.42%
Return on tangible equity 7.76% 7.09% 9.36% 7.85% 7.61%
Return on average assets 0.76% 0.68% 0.90% 0.82% 0.81%
Net interest margin (FTE) 3.96% 4.01% 3.99% 3.94% 3.87%
FTE adjustment - investments 1,083 1,062 1,134 1,138 1,196
FTE adjustment - loans 12 11 11 11 12
Amortization of intangibles 137 137 126 74 74
Amortization of intangibles, net of taxes 83 83 77 45 45
Average shares outstanding 16,414,893 16,516,438 16,624,637 16,756,589 17,044,160
Average earning assets 3,106,504 3,151,590 3,165,595 2,938,994 2,957,022
Average interest bearing liabilities 2,481,430 2,527,848 2,521,901 2,323,202 2,323,711
YEAR-TO-DATE
Diluted earnings per share $ 0.76 $ 0.36 $ 1.64 $ 1.16 $ 0.75
Core earnings (excludes nonrecurring items) (non-GAAP) 12,492 6,083 26,870 19,466 12,891
Diluted core earnings per share (non-GAAP) 0.76 0.37 1.59 1.15 0.75
Cash dividends declared per common share 0.42 0.21 0.80 0.60 0.40
Cash dividends declared - amount 6,903 3,469 13,496 10,173 6,839
Return on average stockholders' equity 6.18% 5.89% 6.77% 6.41% 6.31%
Return on tangible equity 7.43% 7.09% 8.05% 7.61% 7.49%
Return on average assets 0.72% 0.68% 0.83% 0.80% 0.79%
Net interest margin (FTE) 3.98% 4.01% 3.93% 3.91% 3.90%
FTE adjustment - investments 2,145 1,062 4,660 3,526 2,388
FTE adjustment - loans 23 11 45 34 23
Amortization of intangibles 274 137 348 222 148
Amortization of intangibles, net of taxes 166 83 212 135 90
Average shares outstanding 16,465,385 16,516,438 16,908,904 17,004,351 17,129,593
Average diluted shares outstanding 16,468,814 16,520,398 16,911,363 17,007,623 17,134,232
Average earning assets 3,129,048 3,151,590 3,008,840 2,952,324 2,959,034
Average interest bearing liabilities 2,503,992 2,527,848 2,378,748 2,331,032 2,334,948
END OF PERIOD
Book value per share $ 24.67 $ 24.62 $ 24.55 $ 24.26 $ 24.03
Tangible book value per share 20.74 20.73 20.66 20.47 20.37
Shares outstanding 16,289,239 16,509,666 16,542,778 16,660,278 16,956,991
Full-time equivalent employees 1,114 1,112 1,068 1,073 1,074
Total number of ATM's 110 110 110 106 102
Total number of financial centers 92 92 92 88 84
Parent company only - investment in subsidiaries 369,965 370,728 368,847 387,944 386,441
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 Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
(Unaudited) 2013 2013 2012 2012 2012
(in thousands, except per share data)
QUARTER-TO-DATE
Net Income $ 6,576 $ 5,937 $ 8,033 $ 6,760 $ 6,536
Nonrecurring items
Gain on FDIC assisted transactions -- -- (2,291) (1,120) --
Merger related costs (467) 240 1,081 815 --
Loss on sale of securities 193 -- -- -- --
FHLB prepayment penalties -- -- 175 -- --
Tax effect 107 (94) 406 120 --
Net nonrecurring items (167) 146 (629) (185) --
Core earnings (non-GAAP) $ 6,409 $ 6,083 $ 7,404 $ 6,575 $ 6,536
Diluted earnings per share $ 0.40 $ 0.36 $ 0.48 $ 0.41 $ 0.38
Nonrecurring items
Gain on FDIC assisted transactions -- -- (0.14) (0.07) --
Merger related costs (0.03) 0.01 0.07 0.05 --
Loss on sale of securities 0.01 -- -- -- --
FHLB prepayment penalties -- -- 0.01 -- --
Tax effect 0.01 -- 0.02 0.01 --
Net nonrecurring items (0.01) 0.01 (0.04) (0.01) --
Diluted core earnings per share (non-GAAP) $ 0.39 $ 0.37 $ 0.44 $ 0.40 $ 0.38
YEAR-TO-DATE
Net Income $ 12,513 $ 5,937 $ 27,684 $ 19,651 $ 12,891
Nonrecurring items
Gain on FDIC assisted transactions -- -- (3,411) (1,120) --
Merger related costs (227) 240 1,896 815 --
Loss on sale of securities 193 -- -- -- --
FHLB prepayment penalties -- -- 175 -- --
Tax effect 13 (94) 526 120 --
Net nonrecurring items (21) 146 (814) (185) --
Core earnings (non-GAAP) $ 12,492 $ 6,083 $ 26,870 $ 19,466 $ 12,891
Diluted earnings per share $ 0.76 $ 0.36 $ 1.64 $ 1.16 $ 0.75
Nonrecurring items
Gain on FDIC assisted transactions -- -- (0.21) (0.07) --
Merger related costs (0.02) 0.01 0.12 0.05 --
Loss on sale of securities 0.01 -- -- -- --
FHLB prepayment penalties -- -- 0.01 -- --
Tax effect 0.01 -- 0.03 0.01 --
Net nonrecurring items -- 0.01 (0.05) (0.01) --
Diluted core earnings per share (non-GAAP) $ 0.76 $ 0.37 $ 1.59 $ 1.15 $ 0.75

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

Source:Simmons First National Corporation