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| 8-K - 8-K - Atlantic Capital Bancshares, Inc. | acb-form8xkinvestorpresent.htm |
1
Atlantic Capital Bancshares, Inc. (ACBI)
Investor Presentation
August 2, 2016
Forward-Looking Statements
This presentation contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933, as amended, and
section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect our current views with respect
to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of
words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,”
“seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” or the negative version of those words or other comparable of a
future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations,
estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by
their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not
guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe
that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be
materially different from the results expressed or implied by the forward-looking statements.
The following risks, among others, could cause actual results to differ materially from the anticipated results or other expectations
expressed in the forward-looking statements: (1) the expected growth opportunities and cost savings from the transaction with First Security
Group, Inc. (“First Security”) may not be fully realized or may take longer to realize than expected; (2) revenues following the transaction
with First Security and recent branch sales may be lower than expected as a result of deposit attrition, increased operating costs, and
customer loss and business disruption may be greater than expected; (3) diversion of management time on merger related issues; (4)
changes in asset quality and credit risk; (5) the cost and availability of capital; (6) customer acceptance of the combined company’s
products and services; (7) customer borrowing, repayment, investment and deposit practices; (8) the introduction, withdrawal, success and
timing of business initiatives; (9) the impact, extent, and timing of technological changes; (10) severe catastrophic events in our geographic
area; (11) a weakening of the economies in which the combined company will conduct operations may adversely affect its operating results;
(12) the U.S. legal and regulatory framework, including those associated with the Dodd-Frank Wall Street Reform and Consumer Protection
Act could adversely affect the operating results of the combined company; (13) the interest rate environment may compress margins and
adversely affect net interest income; (14) changes in trade, monetary and fiscal policies of various governmental bodies and central banks
could affect the economic environment in which we operate; (15) our ability to determine accurate values of certain assets and liabilities;
(16) adverse behaviors in securities, public debt, and capital markets, including changes in market liquidity and volatility; (17) our ability to
anticipate interest rate changes correctly and manage interest rate risk presented through unanticipated changes in our interest rate risk
position and/or short- and long-term interest rates; (18) unanticipated changes in our liquidity position, including but not limited to our ability
to enter the financial markets to manage and respond to any changes to our liquidity position; (19) adequacy of our risk management
program; (20) increased costs associated with operating as a public company; (21) competition from other financial services companies in
the companies’ markets could adversely affect operations; and (22) other factors described in Atlantic Capital’s reports filed with the
Securities and Exchange Commission and available on the SEC’s website (www.sec.gov).
2
Non-GAAP Financial Information
Statements included in this presentation include non-GAAP financial measures and should be read long with the accompanying tables,
which provide a reconciliation of non-GAAP financial measures to GAAP financial measures. Atlantic Capital management uses non-GAAP
financial measures, including: (i) operating net income; (ii) operating non-interest expense; (iii) operating provision for loan losses, (iv)
taxable equivalent net interest margin, (v) efficiency ratio (vi) operating return on assets; (vii) operating return on equity: (viii) tangible
common equity and (ix) deposits excluding deposits assumed in branch sales, in its analysis of the Company's performance.
Management believes that non-GAAP financial measures provide a greater understanding of ongoing performance and operations, and
enhance comparability with prior periods. Non-GAAP financial measures should not be considered as an alternative to any measure of
performance or financial condition as determined in accordance with GAAP, and investors should consider Atlantic Capital’s performance
and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of
the Company. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a
substitute for analysis of the results or financial condition as reported under GAAP. Non-GAAP financial measures may not be comparable
to non-GAAP financial measures presented by other companies.
3
Proprietary & Confidential
Overview
Atlantic Capital was organized in 2006 and completed an initial equity capital raise of
$125 million in 2007
Focused on banking:
Small to mid-sized enterprises with revenues up to $250 million
Highly-select group of institutional caliber commercial real estate developers and
investors
Principals of our commercial clients, professionals and their practices
Differentiated by providing superior expertise, competitive capabilities, and high
touch service delivery
Completed acquisition of First Security on October 31, 2015
Public market liquidity and value by listing shares on NASDAQ
Geographic diversification into Eastern Tennessee
Business mix diversification
Sold 7 offices in Eastern Tennessee as part of repositioning of First Security’s retail
business
Closed in 2nd quarter of 2016
4
Proprietary & Confidential
Atlantic Capital Strategy
Become a premier southeastern
business and private banking company
Investing in people and
capabilities to accelerate
organic growth and build
profitability
Results are evidence of
meaningful progress
Attractive interest rate risk
position
Completed acquisition of First
Security on October 31, 2015
Ongoing evaluation of new
market expansion through
mergers and acquisitions and
de novo entry
Patient and disciplined
approach with focus on
shareholder value
Accelerated Organic Growth Strategic Expansion
5
Proprietary & Confidential
Atlantic Capital Highlights
Opened in 2007 to serve middle market companies in
southeastern US
Organically grew to $1.4 billion in assets despite market downturn
Well positioned to capitalize on Atlanta market recovery, new
market expansion and higher interest rates
Supplemented by recently completed strategic acquisition of First
Security
Leadership continuity in key markets
Broad experience in all business lines
Focused on small to mid-sized companies and private banking
services to individuals
Initiatives in place to maintain robust top line growth
Operating model will produce enhanced efficiencies going forward
Consistently high asset quality
NPAs/total assets 0.07% as of June 30, 2016
Organic Growth
Story in Desirable
Markets
Experienced
Management Team
Attractive Business
Mix
Strong Growth
Prospects
Disciplined Risk
Management
6
Legacy ACB
Loans Held for Investment
$1,046
$1,791
$1,887 $1,942
Financial Highlights
Total loans held for investment increased:
$55 million, or 2.9%, from March 31, 2016 and
$151 million, or 8.5%, from year end
Total deposits (excluding deposits assumed in branch sales) increased:
$74 million, or 3.5%, from March 31, 2016 and
$109 million, or 5.3%, from year end
Dollars in millions
*excluding deposits sold in branch sales. This is a non-GAAP financial measure. Please see “Non-GAAP Reconciliation” on page 21 for more details.
Deposits* Total Assets
7
Combined Bank
$1,382
$2,639 $2,725
$2,808
$1,129
$2,049 $2,085
$2,158
Q3
2015
Q4
2015
Q1
2016
Q2
2016
Q3
2015
Q4
2015
Q1
2016
Q2
2016
Q3
2015
Q4
2015
Q1
2016
Q2
2016
$0.13
$0.44
$0.38
$0.55
$0.62
$0.14 $0.15
Q1 Q2
2016 2016
Financial Highlights
Dollars in thousands
*Operating noninterest income, operating diluted earnings and efficiency ratio are non-GAAP financial measures that exclude merger-related expenses
and net gain on sale of branches. Please see “Non-GAAP Reconciliation” on page 21 for more details.
$2,797 $2,888
$3,875
$5,342
$9,399
$4,420
$4,995
64.2%
73.5% 75.9%
69.1% 68.8%
75.2% 72.0%
8
Efficiency Ratio* Operating Noninterest Income*
Diluted Earnings Per Share – Operating*
2.99%
2.75% 2.75%
2.85%
2.98%
3.26%
3.05%
3.12%
3.00%
2011 2012 2013 2014 2015
Net Interest Margin
2011 2012 2013 2014 2015
Q1 Q2
2016 2016
2011 2012 2013 2014 2015 Q1 Q2
2016 2016
2011 2012 2013 2014 2015 Q1 Q2
2016 2016
excludes purchase accounting adjustments
1.39% 1.44% 1.32%
1.10% 1.06%
0.93% 0.95%
Q1 Q2
2016 2016
0.71%
0.43%
0.36%
0.12%
0.40%
0.08% 0.07%
Superior Credit Quality
9
0.79%
0.49%
0.36%
0.00%
0.45%
0.02% 0.05%
Allowance for Loan Losses / Total Loans
Non-Performing Loans / Total Loans Non-Performing Assets / Total Assets
1.43%
-0.32%
0.02%
-0.01%
0.05%
0.35%
0.00%
Net Charge Offs / Total Average Loans
Q1 Q2
2016 2016
2011 2012 2013 2014 2015 Q1 Q2
2016 2016
2011 2012 2013 2014 2015
2011 2012 2013 2014 2015
Q1 Q2
2016 2016 2011 2012 2013 2014 2015
YTD 2016:
0.17%
Asset Sensitivity
Change in Net Interest Income
10
6.7%
14.5%
22.8%
7.3%
15.7%
24.4%
0%
5%
10%
15%
20%
25%
30%
Up 100 bps Up 200 bps Up 300 bps
1 Year 2 Years
As of June 30, 2016:
60% of loans are variable rate
28% of deposits are noninterest bearing
Diversified Loan Mix
Dollars in thousands
Loans Held For Investment
at Jun. 30, 2016
11
Loan Growth by Type
Jun. 30,
2016
Dec. 31,
2015
YTD
Change
Loans held for investment
Commercial loans:
Commercial and industrial 508,516$ 467,083$ 41,433$
Commercial real estate:
Multifamily 79,144 78,778 366
Owner occupied 351,419 320,656 30,763
Investment 431,633 446,979 (15,346)
Construction and land:
1-4 family residential
construction 9,611 6,609 3,002
Other construction,
development and land 199,536 159,749 39,787
Mortgage warehouse loans 126,108 84,350 41,758
Total commercial loans 1,705,967 1,564,204 141,763
Residential:
Residential mortgages 103,313 110,381 (7,068)
Home equity 80,321 80,738 (417)
Total residential loans 183,634 191,119 (7,485)
Consumer 29,788 30,451 (663)
Other 28,168 6,901 21,267
1,947,557 1,792,675 154,882
(5,420) (2,006) (3,414)
Total loans held for investment 1,942,137$ 1,790,669$ 151,468$
Less net deferred fees and other
unearned income
C&I
Owner Occupied
CRE
Construction and land
Mortgage Warehouse
Residential mortgages
Home equity
Consumer & Other
26%
18%
11%
7%
5%
4%
26%
3%
Attractive Deposit Mix
28%
11%
1%
42%
8%
10%
Noninterest-bearing
Interest Checking
Savings
Money Market
Time
Brokered
12
Jun. 30,
2016
% of
Total
Dec. 31,
2015
% of
Total
Noninterest-bearing 592,043$ 28% 544,561$ 24%
Interest checking 231,091 11% 232,868 10%
Savings 30,839 1% 28,922 1%
Money market 913,094 42% 875,441 39%
Time 178,615 8% 183,206 8%
Brokered 212,623 10% 183,810 8%
Deposits to be assumed
in branch sale - 0% 213,410 10%
Total Deposits 2,158,305$ 100% 2,262,218$ 100%
Cost of deposits 0.35% 0.28%
Deposits
at Jun. 30, 2016
Deposit Growth by Type
Dollars in thousands
First Security Acquisition Rationale
NASDAQ listing
Significant new capital including DTA, equity private placement at premium to
TBV, and subordinated notes
More diverse shareholder base
18 offices providing core funding along commercially attractive I-75 corridor
Atlanta: High density of small businesses and commercial enterprises
Chattanooga/Knoxville: Diversified manufacturing and service economies
Atlantic Capital’s Strengths: C&I, CRE and Private Banking; Corporate
Treasury and Private Banking Deposits
First Security’s Strengths: Small Business and Specialty Commercial
Lending; Small Business and Retail Deposit Channel
Integration plan ensures management continuity with local market presence
and significant domain expertise
Significant cost saving and revenue enhancement opportunities
Retains a significant portion of First Security NOLs
Sustains robust loan origination trends and opportunities in strategic markets
Sound credit quality profile limits balance sheet risk
Complementary interest rate risk positions
Public Company
Value and Liquidity
For Shareholders
Geographic
Expansion
Broader Business
Mix
Compelling
Financial
Opportunity
13
Creates a leading middle market commercial bank operating along the I-75 corridor
Attractive Market Demographics
Atlanta-Sandy Springs-Roswell, GA MSA
• Total Population 2014: Approximately 5.6 million
• 2014-2019 Population Growth: 6.4% projected
• Median Household Income 2014: $52,533
• Total Deposits in Market: Approximately $130 billion
Chattanooga, TN-GA MSA includes Dalton and Cleveland
• Total Population 2014: Approximately 544,000
• 2014-2019 Population Growth: 4.0% projected
• Median Household Income 2014: $41,704
• Total Deposits in Market: Approximately $8.5 billion
Knoxville, TN MSA
• Total Population 2014: Approximately 855,000
• 2014-2019 Population Growth: 3.1% projected
• Median Household Income 2014: $44,405
• Total Deposits in Market: Approximately $14.7 billion
Source: Nielsen, SNL Financial
14
2016 Priorities
15
Complete integration of the acquired First Security businesses including the
realization of estimated cost savings
Continue the trajectory of growth and profit improvement in legacy Atlantic
Capital businesses
Reposition legacy First Security businesses for improved performance
Consider further geographic expansion, particularly de novo or team lift-out
opportunities in other attractive metropolitan markets
The New Atlantic Capital
Three attractive growth markets
Focus on corporate, business and private banking
Solid relationship deposit funding
Sound credit quality
Positioned for interest rate increase
Pursuing disciplined strategic
expansion with a focus on
shareholder value
Organic
Growth
Strategic
Opportunities
16
APPENDIX
Management Biographies
Name and Title Age Experience
Patrick Oakes
Executive Vice President &
Chief Financial Officer
48 • Former Chief Financial Officer of Square 1 Financial, Inc.
• Former Executive Vice President and Chief Financial Officer of Encore Bancshares, Inc.
• Former Senior Vice President and Treasurer for Sterling Bancshares, Inc.
• Chartered Financial Analyst
Douglas Williams
Chief Executive Officer
58 • Chief Executive Officer of Atlantic Capital since its inception
• Former Managing Director and Head of Wachovia Corporation’s International Corporate Finance Group
• Held numerous roles within Wachovia, including Executive Vice President and Head of the Global
Corporate Banking Division; Chief Risk Officer for all corporate, institutional, and wholesale banking
activities; Executive Vice President and Co-Head of Wachovia’s Capital Markets Division and Executive
Vice President and Head of Wachovia’s US Corporate Banking Division
• Chairman of the Community Depository Institutions Advisory Council (CDIAC) of the Federal Reserve
Bank of Atlanta and its representative to the CDIAC of the Federal Reserve Board of Governors
• Serves on the Boards of the Metro Atlanta Chamber of Commerce, the Georgia Chamber of Commerce,
and the YMCA of Metropolitan Atlanta and the High Museum of Art and is a Member of the Buckhead
Coalition
Michael Kramer
President,
Chief Operating Officer
58 • Chief Executive Officer and President of First Security since December and Chief Executive Officer of
FSGBank since 2011
• Former Managing Director of Ridley Capital Group
• Former Director, Chief Executive Officer and President of Ohio Legacy Corporation
• Former Chief Operating Officer and Chief Technology Officer of Integra Bank Corporation
• Serves on the Boards of Chattanooga Chamber of Commerce, Chattanooga United Way, The
Tennessee Bankers Association and the Chattanooga Young Life Committee
18
ACBI Historical Balance Sheet
19
June 30, March 31, December 31, June 30,
(in thousands, except share and per share data) 2016 2016 2015 2015
ASSETS
Cash and due from banks $ 40,309 $ 36,585 $ 45,848 $ 11,943
Interest-bearing deposits in banks 239,387 91,608 130,900 53,457
Other short-term investments 20,548 32,861 26,137 62,059
Cash and cash equivalents 300,244 161,054 202,885 127,459
Securities available-for-sale 328,370 364,422 346,221 140,716
Other investments 22,575 11,899 8,034 4,811
Loans held for sale 29,061 95,291 95,465 1,768
Loans held for investment 1,942,137 1,886,763 1,790,669 1,056,688
Less: allowance for loan losses (18,377) (17,608) (18,905) (11,985)
Loans held for investment, net 1,923,760 1,869,155 1,771,764 1,044,703
Branch premises held for sale – 7,200 7,200 –
Premises and equipment, net 21,770 22,780 23,145 3,345
Bank owned life insurance 61,378 60,981 60,608 30,252
Goodwill and intangible assets, net 31,674 33,914 35,232 1,055
Other real estate owned 951 1,760 1,982 27
Other assets 88,039 96,213 86,244 19,131
Total assets $ 2,807,822 $ 2,724,669 $ 2,638,780 $ 1,373,267
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing demand $ 592,043 $ 560,363 $ 544,561 $ 327,775
Interest-bearing checking 231,091 215,176 232,868 115,614
Savings 30,839 29,788 28,922 437
Money market 913,094 862,120 875,441 546,408
Time 178,615 187,750 183,206 16,597
Brokered deposits 212,623 229,408 183,810 96,230
Deposits to be assumed in branch sale – 197,857 213,410 –
Total deposits 2,158,305 2,282,462 2,262,218 1,103,061
Federal funds purchased and securities sold under agreements to repurchase 14,047 11,824 11,931 30,000
Federal Home Loan Bank borrowings 240,000 60,000 – 85,349
Long-term debt 49,281 49,239 49,197 –
Other liabilities 42,123 26,491 27,442 8,372
Total liabilities 2,503,756 2,430,016 2,350,788 1,226,782
SHAREHOLDERS' EQUITY
Preferred stock, no par value; 10,000,000 shares authorized; no shares issued and
outstanding as of June 30, 2016, March 31, 2016, December 31, 2015 and June 30, 2015 – – – –
Common stock, no par value; 100,000,000 shares authorized;
24,750,163, 24,569,823, 24,425,546, and 13,562,125 shares issued and outstanding as of
June 30, 2016, March 31, 2016, December 31, 2015, and June 30, 2015, respectively 289,353 288,270 286,367 136,752
Retained earnings 11,219 6,073 3,141 9,076
Accumulated other comprehensive income (loss) 3,494 310 (1,516) 657
Total shareholders’ equity 304,066 294,653 287,992 146,485
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 2,807,822 $ 2,724,669 $ 2,638,780 $ 1,373,267
Atlantic Capital Bancshares, Inc.
Consolidated Balance Sheets (interim periods unaudited)
ACBI Historical Income Statement
($ in thousands)
20
Atlantic Capital Bancshares, Inc.
Consolidated Statements of Income (unaudited)
(in thousands except per share data)
June 30,
2016
March 31,
2016
December
31, 2015
September
30, 2015
June 30,
2015
June 30,
2016
June 30,
2015
INTEREST INCOME
Loans, including fees $ 20,282 $ 19,625 $ 16,688 $ 9,423 $ 9,500 $ 39,907 $ 18,451
Investment securities - available-for-sale 1,327 1,601 1,224 664 710 2,928 1,413
Interest and dividends on other interest‑earning assets 507 273 328 247 271 780 529
Total interest income 22,116 21,499 18,240 10,334 10,481 43,615 20,393
INTEREST EXPENSE
Interest on deposits 1,841 1,673 1,355 751 769 3,514 1,511
Interest on Federal Home Loan Bank advances 147 44 7 52 117 191 231
Interest on federal funds purchased and securities sold under
agreements to repurchase 87 67 10 20 25 154 49
Interest on long-term debt 832 810 841 17 – 1,642 –
Other – 38 79 – – 38 –
Total interest expense 2,907 2,632 2,292 840 911 5,539 1,791
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 19,209 18,867 15,948 9,494 9,570 38,076 18,602
Provision for loan losses 777 368 7,623 (137) 185 1,145 549
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 18,432 18,499 8,325 9,631 9,385 36,931 18,053
NONINTEREST INCOME
Service charges 1,392 1,498 1,265 521 501 2,890 827
Gains on sale of securities available-for-sale 11 33 – 10 – 44 –
Gains on sale of other assets 31 48 103 – – 79 –
Mortgage income 447 339 163 – – 786 –
Trust income 386 314 192 – – 700 –
Derivatives income 98 65 89 67 65 163 148
Bank owned life insurance 398 393 365 227 1,336 791 1,567
SBA lending activities 1,204 880 904 745 903 2,084 1,261
TriNet lending activities 761 383 – – – 1,144 –
Gains on sale of branches 3,885 – – – – 3,885 –
Other noninterest income 267 467 379 159 223 734 407
Total noninterest income 8,880 4,420 3,460 1,729 3,028 13,300 4,210
NONINTEREST EXPENSE
Salaries and employee benefits 10,420 10,555 9,661 4,859 4,836 20,975 9,578
Occupancy 1,274 1,100 907 419 423 2,374 844
Equipment and software 724 686 608 243 225 1,410 444
Professional services 760 748 1,020 208 273 1,508 382
Postage, printing and supplies 159 169 115 21 18 328 42
Communications and data processing 694 916 555 313 342 1,610 673
Marketing and business development 317 267 197 90 77 584 123
FDIC premiums 493 398 273 161 189 891 355
Merger and conversion costs 1,210 749 7,172 718 756 1,959 1,264
Amortization of intangibles 668 762 526 – – 1,430 –
Other noninterest expense 2,224 1,916 2,205 639 682 4,140 1,318
Total noninterest expense 18,943 18,266 23,239 7,671 7,821 37,209 15,023
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES 8,369 4,653 (11,454) 3,689 4,592 13,022 7,240
Provision for income taxes 3,222 1,722 (3,293) 1,463 1,690 4,944 2,624
NET INCOME (LOSS) $ 5,147 $ 2,931 $ (8,161) $ 2,226 $ 2,902 $ 8,078 $ 4,616
Net income (loss) per common share‑basic $ 0.21 $ 0.12 $ (0.40) $ 0.16 $ 0.21 $ 0.33 $ 0.34
Net income (loss) per common share‑diluted $ 0.20 $ 0.12 $ (0.40) $ 0.16 $ 0.21 $ 0.32 $ 0.33
Weighted average shares - basic 24,644,755 24,485,900 20,494,895 13,562,125 13,552,820 24,565,328 13,509,441
Weighted average shares - diluted 25,158,694 24,993,597 21,004,577 13,904,395 13,895,090 25,082,968 13,846,975
Six months endedThree months ended
Non-GAAP Reconciliation
21
(in thousands, except per share data)
Second Quarter First Quarter Fourth Quarter Third Quarter Second Quarter
Interest income reconciliation
Interest income - taxable equivalent $ 22,190 $ 21,553 $ 18,270 $ 10,345 10,492$
Taxable equivalent adjustment (74) (54) (30) (11) (11)
Interest income - GAAP $ 22,116 $ 21,499 $ 18,240 $ 10,334 $ 10,481
Net interest income reconciliation
Net interest income - taxable equivalent $ 19,283 $ 18,921 $ 15,978 $ 9,505 9,581$
Taxable equivalent adjustment (74) (54) (30) (11) (11)
Net interest income - GAAP $ 19,209 $ 18,867 $ 15,948 $ 9,494 $ 9,570
Total revenue reconciliation
Total operating revenue $ 23,341 $ 23,341 $ 19,438 $ 11,234 12,609$
Taxable equivalent adjustment (54) (54) (30) (11) (11)
Total revenue - GAAP $ 23,287 $ 23,287 $ 19,408 $ 11,223 $ 12,598
Operating provision for loan losses reconciliation
Operating provision for loan losses $ 777 $ 368 $ 859 $ (137) 185$
Provision for acquired non PCI FSG loans - - 6,764 - -
Provision for loan losses - GAAP $ 777 $ 368 $ 7,623 $ (137) $ 185
Operating noninterest income reconciliation
Operating noninterest income $ 4,995 $ 4,420 $ 3,460 $ 1,729 3,028$
Gain on sale of branches 3,885 - - - -
Noninterest income - GAAP $ 8,880 $ 4,420 $ 3,460 $ 1,729 $ 3,028
Operating noninterest expense reconciliation
Operating noninterest expense $ 17,428 $ 17,517 $ 16,067 $ 6,953 7,065$
Merger-related charges 1,210 749 7,172 718 756
Divestiture expenses 305 - - - -
Noninterest expense - GAAP $ 18,943 $ 18,266 $ 23,239 $ 7,671 $ 7,821
Operating income before income taxes reconciliation
Operating income before income taxes $ 6,073 $ 5,456 $ 2,512 $ 4,418 5,359$
Taxable equivalent adjustment (74) (54) (30) (11) (11)
Merger-related charges (1,210) (749) (7,172) (718) (756)
Divestiture expenses (305) - - - -
Gain on sale of branches 3,885 - - - -
Provision for acquired non PCI FSG loans - - (6,764) - -
Income (loss) before income taxes - GAAP $ 8,369 $ 4,653 $ (11,454) $ 3,689 $ 4,592
2015
2016
(in thousands, except per share data)
Second Quarter First Quarter Fourth Quarter Third Quarter Second Quarter
Income tax reconciliation
Operating income tax expense $ 2,381 $ 2,065 $ 2,117 $ 1,749 1,991$
Taxable equivalent adjustment (74) (54) (30) (11) (11)
Merger related charges, tax benefit (467) (289) (2,769) (275) (290)
Divestiture expenses, tax benefit (118) - - - -
Gain on sale of branches, tax expense 1,500 - - - -
Provision for acquired non PCI FSG loans, tax benefit - - (2,611) - -
Income tax expense - GAAP $ 3,222 $ 1,722 $ (3,293) $ 1,463 $ 1,690
Net income reconciliation
Operating net income $ 3,692 $ 3,391 $ 395 $ 2,669 3,368$
Merger related charges, net of income tax (743) (460) (4,403) (443) (466)
Divestiture expenses, net of income tax (187) - - - -
Gain on sale of branches, net of income tax 2,385 - - - -
Provision for acquired non PCI FSG loans, net of income tax
- - (4,153) - -
Net income - GAAP $ 5,147 $ 2,931 $ (8,161) $ 2,226 $ 2,902
Diluted earnings per share reconciliation
Diluted earnings per share - operating $ 0.15 $ 0.14 $ 0.02 $ 0.19 0.24$
Merger related charges (0.03) (0.02) (0.42) (0.03) (0.03)
Net gain on sale of branches 0.08 - - - -
Diluted earnings per share - GAAP $ 0.20 $ 0.12 $ (0.40) $ 0.16 $ 0.21
Efficiency ratio reconciliation
Operating noninterest income $ 4,995 $ 4,420 $ 3,460 $ 1,729 $ 3,028
Gain on sale of branches 3,885 - - - -
Noninterest income - GAAP $ 8,880 $ 4,420 $ 3,460 $ 1,729 $ 3,028
Operating noninterest expense $ 17,428 $ 17,517 $ 16,067 $ 6,953 7,065$
Merger-related charges 1,210 749 7,172 718 756
Divestiture expenses 305 - - - -
Noninterest expense - GAAP $ 18,943 $ 18,266 $ 23,239 $ 7,671 $ 7,821
Net interest income 19,209 18,867 15,948 9,494 9,570
Efficiency ratio 72.00% 75.22% 82.79% 61.95% 56.08%
2015
2016