Attached files
| file | filename |
|---|---|
| 8-K - 8-K - Capital Bank Financial Corp. | a8-kx1q17earningsrelease.htm |
| EX-99.2 - EXHIBIT 99.2 - Capital Bank Financial Corp. | cbf1q17slidesv4.htm |
CBF Reports First Quarter Results
Page 1
April 21, 2017
EXHIBIT 99.1
CONTACT:
Kenneth A. Posner
Chief of Strategic Planning and Investor Relations
Phone: (212) 399-4020
E-mail: Kposner@cbfcorp.com
CAPITAL BANK FINANCIAL CORP. REPORTS FIRST QUARTER GAAP AND CORE EPS OF $0.39 AND $0.45
CHARLOTTE, NC. (April 21, 2017) - Capital Bank Financial Corp. (Nasdaq: CBF) (the “Company”) today reported first quarter net income of $20.9 million, which increased 112% year over year. GAAP net income per diluted share was $0.39. Core net income increased to $23.9 million, up 42% year over year. Core net income per diluted share was $0.45. Core pre-tax adjustments for the first quarter of 2017 included $4.9 million of acquisition and branch closure expenses, offset by $0.1 million gain on investment securities.
“With the CommunityOne conversion now behind us, we are totally focused on high-quality loan and core deposit growth. Thanks to the consistent focus and efforts of Capital Bank’s teammates, we’re optimistic about the outlook,” said Gene Taylor, Chairman and Chief Executive Officer of Capital Bank Financial Corp.
“In addition to successfully completing the CommunityOne systems conversion, we’ve put in place new plans to rationalize excess facilities, which will help us achieve our stated profitability and return targets,” added Chris Marshall, Chief Financial Officer of Capital Bank Financial Corp.
Loan Portfolio and Composition
During the first quarter, the loan portfolio increased by $105.8 million to $7.5 billion. New loans of $504.8 million were offset by payoffs totaling $379.6 million and special asset resolutions of $19.4 million.
The relative composition of the Company’s loan portfolio at the end of the first quarter of 2017 and fourth and first quarters of 2016 was as follows:
Mar 31, 2017 | Dec 31, 2016 | Mar 31, 2016 | |||||||
Commercial real estate | 24 | % | 23 | % | 22 | % | |||
C&I | 37 | % | 38 | % | 44 | % | |||
Consumer | 36 | % | 36 | % | 32 | % | |||
Other | 3 | % | 3 | % | 2 | % | |||
Total | 100 | % | 100 | % | 100 | % | |||
Deposits Composition and Cost of Funds
During the first quarter, total deposits increased by $212.0 million to $8.1 billion. The sequential increase was primarily due to a $90.1 million increase of non-interest checking balances and an increase of $95.6 million in money market balances. The cost of total deposits remained flat at 0.39%, while the cost of core deposits increased two basis points to 0.21%. Core deposits include all checking, savings and money market accounts, excluding brokered, and represent 73% of total deposits.
Net Interest Income and Net Interest Margin
Net interest income increased $4.3 million to $82.1 million from $77.8 million for the fourth quarter of 2016 and increased $20.7 million from $61.4 million for the first quarter of 2016. The net interest margin for the first quarter of 2017 was 3.73%, an increase of six basis points sequentially and nine basis points year over year. The sequential and year over year net interest margin increase was mainly due to a legacy loan recovery, which occurred during the first quarter of 2017.
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April 21, 2017
Non-Interest Income
Non-interest income declined $1.2 million to $15.9 million from $17.0 million for the fourth quarter of 2016 and increased $13.3 million from $2.6 million for the first quarter of 2016. The sequential decrease was mainly driven by $1.8 million lower investment securities gains. The year over year increase was mainly due to the absence of a $9.2 million charge for the termination of loss share agreements in the prior year and an increase associated with the acquisition of CommunityOne.
Provision for Loan and Lease Losses and Credit Quality
The provision of $3.4 million recorded for the first quarter of 2017 included a $3.2 million provision for new and acquired non-impaired loans and a $186 thousand provision on acquired impaired loans. Net charge-offs for the first quarter of 2017 were $2.6 million, $0.3 million lower than the fourth quarter of 2016.
At March 31, 2017, the allowance for loan and lease losses was $43.9 million, of which $23.2 million related to acquired impaired loans and $20.7 million related to new and acquired non-impaired loans. The allowance for loan and lease losses represents 0.58% of the Company’s total $7.5 billion loan portfolio.
At March 31, 2017, non-performing loans were $71.6 million, a decrease of 4.7% from December 31, 2016, mainly as a result of resolutions and upgrades. Non-performing loans increased 10.8% from March 31, 2016, due primarily to the acquisition of CommunityOne.
Non-Interest Expense
Non-interest expense declined $11.3 million to $62.7 million from $74.0 million for the fourth quarter of 2016 and increased $15.8 million from $46.9 million for the first quarter of 2016. The sequential decrease was mainly due to a decrease of $15.5 million in conversion and merger expense and the absence of $1.4 million legal settlement expenses. Partially offsetting the decrease was a $3.0 million increase in salaries expense and benefit expense and $1.9 million in restructuring charges. The year over year increase was mainly due to an increase of $7.0 million in salaries and benefit expense, $1.8 million in restructuring charges, $1.4 million in conversion and merger expense and $1.3 million in occupancy expense, mostly related to the acquisition of CommunityOne.
Income Tax Expense
Income tax expense was $11.0 million for the first quarter of 2017, an effective rate of 34%, compared to $6.4 million and 34% for the fourth quarter of 2016. Income tax expense was $5.8 million and an effective tax rate of 37% for the first quarter of 2016. The year-over-year decrease in effective income tax rate is due to lower state income taxes, higher tax exempt interest income and other favorable adjustments.
Financial Position
Total assets increased by $167.4 million to $10.1 billion as of March 31, 2017, from $9.9 billion as of December 31, 2016. During the quarter, the Company’s loan portfolio increased $105.8 million to $7.5 billion. Total deposits increased by $212.0 million to $8.1 billion, and core deposits increased by $214.6 million, or a 15% annualized rate. FHLB borrowings decreased $55.1 million. Book value per share was $25.17 as of March 31, 2017, an increase of $0.21 and $2.09 over December 31, 2016 and March 31, 2016, respectively. Tangible book value per share was $20.29 as of March 31, 2017, an increase of $0.28 and $0.52 over December 31, 2016 and March 31, 2016, respectively. During the first quarter, the Company did not repurchase shares of common stock. The Company has $88 million remaining under the current board authorized stock repurchase program.
The Company declared a cash dividend of $0.12 per share, payable on May 19, 2017, to shareholders of record as of May 5, 2017.
Conference Call
The Company will host a conference call today at 10:00 a.m. Eastern Time. The number to call for this interactive teleconference is (913) 312-0654, and the confirmation pass code is 7115841. Please dial in 10 minutes prior to the beginning of the call. A telephonic replay of the conference call will be available through April 28, 2017, by dialing (719) 457-0820 and entering pass
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April 21, 2017
code 7115841. The live broadcast of the conference call will be available online at the Company’s web site at www.capitalbank-us.com, by following the link to Investor Relations. An on-line replay of the call will be available at the same site for 90 days.
Forward-Looking Statements
Information in this press release contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. Accordingly, these statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed in them. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of several factors more fully described under the caption “Risk Factors” in the annual report on Form 10-K and other periodic reports filed by us with the Securities and Exchange Commission. Any or all of our forward-looking statements in this press release may turn out to be inaccurate. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward looking statements including, but not limited to: (1) changes in general economic and financial market conditions; (2) changes in the regulatory environment; (3) economic conditions generally and in the financial services industry; (4) changes in the economy affecting real estate values; (5) our ability to achieve loan and deposit growth; (6) the completion of future acquisitions or business combinations and our ability to integrate any acquired businesses into our business model; (7) projected population and income growth in our targeted market areas; (8) competitive pressures in our markets and industry; (9) our ability to attract and retain key personnel; (10) changes in accounting policies or judgments and (11) volatility and direction of market interest rates and a weakening of the economy which could materially impact credit quality trends and the ability to generate loans. All forward-looking statements are necessarily only estimates of future results, and actual results may differ materially from expectations. You are, therefore, cautioned not to place undue reliance on such statements, which should be read in conjunction with the other cautionary statements that are included elsewhere in this press release. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events.
Use of Non-GAAP Financial Measures
Core net income, core efficiency ratio, core return-on-assets (“core ROA”), tangible book value and tangible book value per share are each non-GAAP measures used in this report. A reconciliation to the most directly comparable GAAP financial measures – net income in the case of core net income and core ROA, total non-interest income and total non-interest expense in the case of core efficiency ratio, and total shareholders’ equity in the case of tangible book value and tangible book value per share – appears in tabular form at the end of this release. The Company believes core net income, the core efficiency ratio and core ROA are useful for both investors and management to understand the effects of certain non-interest items and provide an alternative view of the Company’s performance over time and in comparison to the Company’s competitors. These measures should not be viewed as a substitute for net income. The Company believes that tangible book value and tangible book value per share are useful for both investors and management as these are measures commonly used by financial institutions, regulators and investors to measure the capital adequacy of financial institutions. The Company believes these measures facilitate comparison of the quality and composition of the Company’s capital over time and in comparison to its competitors. These measures should not be viewed as a substitute for the most directly comparable GAAP measure.
The Company uses these non-GAAP measures for various purposes, including measuring performance for incentive compensation and as a basis for strategic planning and forecasting.
These non-GAAP measures have inherent limitations, are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for analysis of results reported under GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.
About Capital Bank Financial Corp.
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April 21, 2017
Capital Bank Financial Corp. is a bank holding company, formed in 2009 to create a premier regional banking franchise in the southeastern United States. CBF is the parent of Capital Bank Corporation, a State of North Carolina chartered financial institution with $10.1 billion in total assets as of March 31, 2017, and 193 full-service banking offices throughout Florida, North and South Carolina, Tennessee and Virginia. To learn more about Capital Bank Financial Corp, please visit www.capitalbank-us.com.
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April 21, 2017
CAPITAL BANK FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars and shares in thousands, except per share data)
(Unaudited)
Three Months Ended | |||||||||||||||||||
Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | |||||||||||||||
Interest and dividend income | $ | 92,937 | $ | 87,746 | $ | 70,929 | $ | 69,579 | $ | 69,472 | |||||||||
Interest expense | 10,821 | 9,927 | 8,302 | 8,064 | 8,105 | ||||||||||||||
Net Interest Income | 82,116 | 77,819 | 62,627 | 61,515 | 61,367 | ||||||||||||||
Provision for loan and lease losses | 3,392 | 1,980 | 586 | 1,172 | 1,375 | ||||||||||||||
Net interest income after provision for loan and lease losses | 78,724 | 75,839 | 62,041 | 60,343 | 59,992 | ||||||||||||||
Non-Interest Income | |||||||||||||||||||
Service charges on deposit accounts | 5,375 | 5,949 | 4,777 | 4,486 | 4,811 | ||||||||||||||
Debit card income | 4,765 | 4,211 | 3,389 | 3,235 | 3,086 | ||||||||||||||
Fees on mortgage loans originated and sold | 1,248 | 1,402 | 1,334 | 1,140 | 971 | ||||||||||||||
Investment advisory and trust fees | 641 | 591 | 290 | 455 | 497 | ||||||||||||||
Termination of loss share agreements | — | — | — | — | (9,178 | ) | |||||||||||||
Investment securities gains (losses), net | 67 | 1,894 | 71 | 117 | 40 | ||||||||||||||
Other income | 3,756 | 2,969 | 2,509 | 2,489 | 2,339 | ||||||||||||||
Total non-interest income | 15,852 | 17,016 | 12,370 | 11,922 | 2,566 | ||||||||||||||
Non-Interest Expense | |||||||||||||||||||
Salaries and employee benefits | 29,166 | 26,134 | 20,935 | 20,139 | 22,162 | ||||||||||||||
Stock-based compensation expense | 900 | 531 | 790 | 467 | 317 | ||||||||||||||
Net occupancy and equipment expense | 8,992 | 8,374 | 7,340 | 7,355 | 7,703 | ||||||||||||||
Computer services | 3,873 | 4,364 | 3,153 | 3,274 | 3,575 | ||||||||||||||
Software expense | 2,662 | 2,391 | 1,948 | 2,000 | 2,036 | ||||||||||||||
Telecommunication expense | 2,424 | 2,147 | 1,790 | 1,558 | 1,532 | ||||||||||||||
OREO valuation expense | 247 | 677 | 742 | 1,119 | 467 | ||||||||||||||
Net gains on sales of OREO | (308 | ) | (150 | ) | (159 | ) | (413 | ) | (679 | ) | |||||||||
Foreclosed asset related expense | 364 | 513 | 397 | 399 | 285 | ||||||||||||||
Loan workout expense | 201 | 327 | 206 | 71 | 244 | ||||||||||||||
Conversion and merger related expense | 3,037 | 18,525 | 394 | 1,236 | 1,687 | ||||||||||||||
Professional fees | 2,096 | 1,761 | 1,642 | 1,353 | 1,612 | ||||||||||||||
Restructuring charges, net | 1,912 | 4 | (113 | ) | 5 | 142 | |||||||||||||
Legal settlement expense | — | 1,361 | 1,500 | — | — | ||||||||||||||
Regulatory assessments | 719 | 1,092 | 841 | 1,259 | 1,275 | ||||||||||||||
Other expense | 6,418 | 5,943 | 6,124 | 4,714 | 4,580 | ||||||||||||||
Total non-interest expense | 62,703 | 73,994 | 47,530 | 44,536 | 46,938 | ||||||||||||||
Income before income taxes | 31,873 | 18,861 | 26,881 | 27,729 | 15,620 | ||||||||||||||
Income tax expense | 10,990 | 6,427 | 8,393 | 10,327 | 5,780 | ||||||||||||||
Net income | $ | 20,883 | $ | 12,434 | $ | 18,488 | $ | 17,402 | $ | 9,840 | |||||||||
Earnings per share: | |||||||||||||||||||
Basic | $ | 0.40 | $ | 0.25 | $ | 0.43 | $ | 0.40 | $ | 0.23 | |||||||||
Diluted | $ | 0.39 | $ | 0.24 | $ | 0.42 | $ | 0.40 | $ | 0.22 | |||||||||
Weighted average shares outstanding: | |||||||||||||||||||
Basic | 51,634 | 49,334 | 43,028 | 43,011 | 43,063 | ||||||||||||||
Diluted | 53,127 | 50,387 | 43,909 | 43,879 | 43,904 | ||||||||||||||
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April 21, 2017
CAPITAL BANK FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
(Dollars and shares in thousands)
(Unaudited)
Mar 31, 2017 | Dec 31, 2016 | Mar 31, 2016 | |||||||||
Assets | |||||||||||
Cash and due from banks | $ | 100,134 | $ | 107,707 | $ | 88,802 | |||||
Interest-bearing deposits in other banks | 60,413 | 201,348 | 93,218 | ||||||||
Total cash and cash equivalents | 160,547 | 309,055 | 182,020 | ||||||||
Trading securities | 4,150 | 3,791 | 3,418 | ||||||||
Investment securities available-for-sale at fair value (amortized cost $1,168,995 $927,266 and $657,631, respectively) | 1,154,496 | 912,250 | 663,925 | ||||||||
Investment securities held-to-maturity at amortized cost (fair value $445,696 $460,911 and $467,372, respectively) | 446,020 | 463,959 | 460,483 | ||||||||
Loans held for sale | 4,980 | 12,874 | 8,070 | ||||||||
Loans, net of deferred loan costs and fees | 7,506,975 | 7,393,318 | 5,626,887 | ||||||||
Less: Allowance for loan and lease losses | 43,891 | 43,065 | 45,263 | ||||||||
Loans, net | 7,463,084 | 7,350,253 | 5,581,624 | ||||||||
Other real estate owned | 51,050 | 53,482 | 48,505 | ||||||||
Premises and equipment, net | 199,167 | 205,425 | 157,131 | ||||||||
Goodwill | 234,158 | 235,500 | 134,522 | ||||||||
Intangible assets, net | 31,553 | 33,370 | 14,166 | ||||||||
Deferred income tax asset, net | 146,724 | 150,272 | 95,363 | ||||||||
Bank owned life insurance | 100,251 | 99,703 | 56,425 | ||||||||
Other assets | 101,862 | 100,723 | 74,146 | ||||||||
Total Assets | $ | 10,098,042 | $ | 9,930,657 | $ | 7,479,798 | |||||
Liabilities and Shareholders’ Equity | |||||||||||
Liabilities | |||||||||||
Deposits: | |||||||||||
Non-interest bearing demand | $ | 1,680,243 | $ | 1,590,164 | $ | 1,190,831 | |||||
Interest bearing demand | 1,960,187 | 1,930,143 | 1,402,342 | ||||||||
Money market | 1,821,474 | 1,725,838 | 1,262,581 | ||||||||
Savings | 496,230 | 497,171 | 420,073 | ||||||||
Time deposits | 2,134,473 | 2,137,312 | 1,663,906 | ||||||||
Total deposits | 8,092,607 | 7,880,628 | 5,939,733 | ||||||||
Federal Home Loan Bank advances | 490,650 | 545,701 | 400,849 | ||||||||
Short-term borrowings | 21,125 | 19,157 | 16,200 | ||||||||
Long-term borrowings | 117,272 | 116,456 | 86,328 | ||||||||
Accrued expenses and other liabilities | 68,457 | 76,668 | 39,695 | ||||||||
Total liabilities | $ | 8,790,111 | $ | 8,638,610 | $ | 6,482,805 | |||||
Shareholders’ equity | |||||||||||
Preferred stock $0.01 par value: 50,000 shares authorized, 0 shares issued | — | — | — | ||||||||
Common stock-Class A $0.01 par value: 200,000 shares authorized, 46,479 issued and 35,213 outstanding, 46,178 issued 34,911 outstanding and 37,207 issued and 26,636 outstanding, respectively. | 465 | 462 | 372 | ||||||||
Common stock-Class B $0.01 par value: 200,000 shares authorized, 18,527 issued and 16,753 outstanding, 18,627 issued and 16,854 outstanding and 18,327 issued and 16,554 outstanding, respectively. | 185 | 186 | 183 | ||||||||
Additional paid in capital | 1,369,689 | 1,368,459 | 1,076,931 | ||||||||
Retained earnings | 262,443 | 247,758 | 214,268 | ||||||||
Accumulated other comprehensive (loss) gain | (12,467 | ) | (12,434 | ) | 3,878 | ||||||
Treasury stock, at cost, 13,040, 13,040 and 12,345 shares, respectively | (312,384 | ) | (312,384 | ) | (298,639 | ) | |||||
Total shareholders’ equity | 1,307,931 | 1,292,047 | 996,993 | ||||||||
Total Liabilities and Shareholders’ Equity | $ | 10,098,042 | $ | 9,930,657 | $ | 7,479,798 | |||||
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CAPITAL BANK FINANCIAL CORP.
KEY METRICS
(Dollars in thousands)
(Unaudited)
Three Months Ended | |||||||||||||||||||
Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | |||||||||||||||
Performance Ratios | |||||||||||||||||||
Interest rate spread | 3.58 | % | 3.53 | % | 3.43 | % | 3.48 | % | 3.50 | % | |||||||||
Net interest margin | 3.73 | % | 3.67 | % | 3.58 | % | 3.62 | % | 3.64 | % | |||||||||
Return on average assets | 0.84 | % | 0.53 | % | 0.97 | % | 0.93 | % | 0.53 | % | |||||||||
Return on average shareholders’ equity | 6.43 | % | 4.05 | % | 7.24 | % | 6.87 | % | 3.96 | % | |||||||||
Efficiency ratio | 64.00 | % | 78.02 | % | 63.38 | % | 60.65 | % | 73.42 | % | |||||||||
Average interest-earning assets to average interest-bearing liabilities | 129.53 | % | 130.22 | % | 131.43 | % | 131.21 | % | 129.54 | % | |||||||||
Average loans receivable to average deposits | 93.41 | % | 94.57 | % | 98.46 | % | 96.56 | % | 95.66 | % | |||||||||
Yield on interest-earning assets | 4.21 | % | 4.13 | % | 4.05 | % | 4.09 | % | 4.11 | % | |||||||||
Cost of interest-bearing liabilities | 0.63 | % | 0.61 | % | 0.62 | % | 0.62 | % | 0.62 | % | |||||||||
Asset and Credit Quality Ratios-Total Loans | |||||||||||||||||||
Non-accrual loans | $ | 13,608 | $ | 11,449 | $ | 11,873 | $ | 9,016 | $ | 8,526 | |||||||||
Acquired impaired loans > 90 days past due and still accruing | $ | 57,969 | $ | 63,668 | $ | 48,477 | $ | 56,108 | $ | 56,041 | |||||||||
Nonperforming loans to loans receivable | 0.95 | % | 1.01 | % | 1.02 | % | 1.13 | % | 1.15 | % | |||||||||
Nonperforming assets to total assets | 1.22 | % | 1.30 | % | 1.37 | % | 1.44 | % | 1.51 | % | |||||||||
ALLL to nonperforming assets | 35.73 | % | 33.45 | % | 41.29 | % | 40.98 | % | 39.97 | % | |||||||||
ALLL to total gross loans | 0.58 | % | 0.58 | % | 0.75 | % | 0.78 | % | 0.80 | % | |||||||||
Annualized net charge-offs/average loans | 0.14 | % | 0.17 | % | 0.10 | % | 0.11 | % | 0.08 | % | |||||||||
Asset and Credit Quality Ratios-Non Acquired Loans | |||||||||||||||||||
Nonperforming non acquired loans to total non acquired loans receivable | 0.21 | % | 0.18 | % | 0.19 | % | 0.12 | % | 0.11 | % | |||||||||
Non acquired loans ALLL to total gross non acquired loans receivable | 0.40 | % | 0.41 | % | 0.43 | % | 0.46 | % | 0.47 | % | |||||||||
Asset and Credit Quality Ratios-Acquired Loans | |||||||||||||||||||
Nonperforming acquired loans to total acquired loans receivable | 2.55 | % | 2.66 | % | 4.65 | % | 5.08 | % | 4.67 | % | |||||||||
Acquired loans ALLL to total gross acquired loans | 0.98 | % | 0.93 | % | 2.15 | % | 2.04 | % | 1.93 | % | |||||||||
Capital Ratios (Company) (1) | |||||||||||||||||||
Total average shareholders’ equity to total average assets | 13.11 | % | 13.15 | % | 13.46 | % | 13.55 | % | 13.35 | % | |||||||||
Tangible common equity ratio (2) | 10.60 | % | 10.59 | % | 11.55 | % | 11.62 | % | 11.57 | % | |||||||||
Tier 1 leverage capital ratio | 11.63 | % | 12.22 | % | 12.89 | % | 12.64 | % | 12.49 | % | |||||||||
Tier 1 common capital ratio | 12.18 | % | 12.40 | % | 13.27 | % | 13.38 | % | 13.38 | % | |||||||||
Tier 1 risk-based capital ratio | 13.43 | % | 13.49 | % | 14.44 | % | 14.57 | % | 14.58 | % | |||||||||
Total risk-based capital ratio | 13.96 | % | 14.02 | % | 15.12 | % | 15.29 | % | 15.32 | % | |||||||||
Capital Ratios (Bank) (1) | |||||||||||||||||||
Tangible common equity ratio (2) | 11.03 | % | 11.07 | % | 10.74 | % | 10.71 | % | 11.45 | % | |||||||||
Tier 1 leverage capital ratio | 10.67 | % | 11.23 | % | 10.53 | % | 10.42 | % | 11.10 | % | |||||||||
Tier 1 common capital ratio | 12.32 | % | 12.39 | % | 11.98 | % | 11.97 | % | 12.95 | % | |||||||||
Tier 1 risk-based capital ratio | 12.32 | % | 12.39 | % | 11.98 | % | 11.97 | % | 12.95 | % | |||||||||
Total risk-based capital ratio | 12.86 | % | 12.93 | % | 12.70 | % | 12.72 | % | 13.72 | % | |||||||||
(1) Capital Ratios are preliminary
(2) See “Reconciliation of Non-GAAP Measures”
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April 21, 2017
CAPITAL BANK FINANCIAL CORP.
LOANS AND DEPOSITS
(Dollars in thousands)
(Unaudited)
Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | |||||||||||||||
Loans | |||||||||||||||||||
Non-owner occupied commercial real estate | $ | 1,187,344 | $ | 1,130,883 | $ | 920,521 | $ | 891,830 | $ | 850,766 | |||||||||
Other commercial construction and land | 350,401 | 327,622 | 222,794 | 212,315 | 194,971 | ||||||||||||||
Multifamily commercial real estate | 115,996 | 117,515 | 76,296 | 74,328 | 75,737 | ||||||||||||||
1-4 family residential construction and land | 157,920 | 140,030 | 111,954 | 100,306 | 96,703 | ||||||||||||||
Total commercial real estate | 1,811,661 | 1,716,050 | 1,331,565 | 1,278,779 | 1,218,177 | ||||||||||||||
Owner occupied commercial real estate | 1,313,086 | 1,321,405 | 1,072,586 | 1,075,306 | 1,095,460 | ||||||||||||||
Commercial and industrial | 1,443,828 | 1,468,874 | 1,458,523 | 1,448,698 | 1,375,233 | ||||||||||||||
Lease financing | — | — | 525 | 877 | 1,088 | ||||||||||||||
Total commercial | 2,756,914 | 2,790,279 | 2,531,634 | 2,524,881 | 2,471,781 | ||||||||||||||
1-4 family residential | 1,787,097 | 1,714,702 | 1,168,468 | 1,039,309 | 1,015,071 | ||||||||||||||
Home equity loans | 502,099 | 507,759 | 364,117 | 364,169 | 368,510 | ||||||||||||||
Indirect auto loans | 199,951 | 226,717 | 254,736 | 285,618 | 317,863 | ||||||||||||||
Other consumer loans | 222,824 | 222,255 | 94,277 | 85,964 | 84,108 | ||||||||||||||
Total consumer | 2,711,971 | 2,671,433 | 1,881,598 | 1,775,060 | 1,785,552 | ||||||||||||||
Other | 231,409 | 228,430 | 191,136 | 166,185 | 159,447 | ||||||||||||||
Total loans | $ | 7,511,955 | $ | 7,406,192 | $ | 5,935,933 | $ | 5,744,905 | $ | 5,634,957 | |||||||||
Deposits | |||||||||||||||||||
Non-interest bearing demand | $ | 1,680,243 | $ | 1,590,164 | $ | 1,207,800 | $ | 1,172,481 | $ | 1,190,831 | |||||||||
Interest bearing demand | 1,960,187 | 1,930,143 | 1,463,520 | 1,456,558 | 1,402,342 | ||||||||||||||
Money market | 1,746,444 | 1,651,023 | 1,166,918 | 1,105,460 | 1,162,546 | ||||||||||||||
Savings | 496,230 | 497,171 | 401,205 | 403,106 | 420,073 | ||||||||||||||
Total core deposits | 5,883,104 | 5,668,501 | 4,239,443 | 4,137,605 | 4,175,792 | ||||||||||||||
Wholesale money market | 75,030 | 74,815 | 125,030 | 50,015 | 100,035 | ||||||||||||||
Time deposits | 2,134,473 | 2,137,312 | 1,668,784 | 1,619,507 | 1,663,906 | ||||||||||||||
Total deposits | $ | 8,092,607 | $ | 7,880,628 | $ | 6,033,257 | $ | 5,807,127 | $ | 5,939,733 | |||||||||
- MORE -
CBF Reports First Quarter Results
Page 9
April 21, 2017
CAPITAL BANK FINANCIAL CORP.
QUARTERLY AVERAGE BALANCES AND YIELDS
(Dollars in thousands)
(Unaudited)
Three Months Ended March 31, 2017 | Three Months Ended December 31, 2016 | |||||||||||||||||||||
Average Balances | Interest | Yield / Rate | Average Balances | Interest | Yield / Rate | |||||||||||||||||
Interest earning assets | ||||||||||||||||||||||
Loans (1) | $ | 7,409,284 | $ | 83,753 | 4.58 | % | $ | 6,977,690 | $ | 79,690 | 4.54 | % | ||||||||||
Investment securities (1) | 1,501,816 | 9,312 | 2.51 | % | 1,347,554 | 8,065 | 2.38 | % | ||||||||||||||
Interest bearing deposits in other banks | 58,269 | 97 | 0.68 | % | 143,446 | 166 | 0.46 | % | ||||||||||||||
Other earning assets (2) | 29,053 | 357 | 4.98 | % | 30,904 | 382 | 4.92 | % | ||||||||||||||
Total interest earning assets | 8,998,422 | $ | 93,519 | 4.21 | % | 8,499,594 | $ | 88,303 | 4.13 | % | ||||||||||||
Non-interest earning assets | 909,138 | 829,740 | ||||||||||||||||||||
Total assets | $ | 9,907,560 | $ | 9,329,334 | ||||||||||||||||||
Interest bearing liabilities | ||||||||||||||||||||||
Time deposits | $ | 2,141,806 | $ | 4,539 | 0.86 | % | $ | 2,049,066 | $ | 4,526 | 0.88 | % | ||||||||||
Money market | 1,777,343 | 1,756 | 0.40 | % | 1,601,167 | 1,498 | 0.37 | % | ||||||||||||||
Interest bearing demand | 1,922,687 | 1,138 | 0.24 | % | 1,748,269 | 935 | 0.21 | % | ||||||||||||||
Savings | 494,538 | 220 | 0.18 | % | 471,466 | 219 | 0.18 | % | ||||||||||||||
Total interest bearing deposits | 6,336,374 | 7,653 | 0.49 | % | 5,869,968 | 7,178 | 0.49 | % | ||||||||||||||
Short-term borrowings and FHLB advances | 493,643 | 887 | 0.73 | % | 548,667 | 662 | 0.48 | % | ||||||||||||||
Long-term borrowings | 116,744 | 2,281 | 7.92 | % | 108,276 | 2,087 | 7.67 | % | ||||||||||||||
Total interest bearing liabilities | 6,946,761 | 10,821 | 0.63 | % | 6,526,911 | 9,927 | 0.61 | % | ||||||||||||||
Non-interest bearing demand | 1,595,695 | 1,508,496 | ||||||||||||||||||||
Other liabilities | 65,753 | 66,710 | ||||||||||||||||||||
Shareholders’ equity | 1,299,351 | 1,227,217 | ||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 9,907,560 | $ | 9,329,334 | ||||||||||||||||||
Net interest income and spread | $ | 82,698 | 3.58 | % | $ | 78,376 | 3.53 | % | ||||||||||||||
Net interest margin | 3.73 | % | 3.67 | % | ||||||||||||||||||
(1) Presented on a fully tax equivalent basis
(2) Includes Federal Home Loan Bank stocks
- MORE -
CBF Reports First Quarter Results
Page 10
April 21, 2017
CAPITAL BANK FINANCIAL CORP.
QUARTERLY AVERAGE BALANCES AND YIELDS
(Dollars in thousands)
(Unaudited)
Three Months Ended March 31, 2017 | Three Months Ended March 31, 2016 | |||||||||||||||||||||
Average Balances | Interest | Yield / Rate | Average Balances | Interest | Yield / Rate | |||||||||||||||||
Interest earning assets | ||||||||||||||||||||||
Loans (1) | $ | 7,409,284 | $ | 83,753 | 4.58 | % | $ | 5,611,488 | $ | 63,009 | 4.52 | % | ||||||||||
Investment securities (1) | 1,501,816 | 9,312 | 2.51 | % | 1,122,523 | 6,483 | 2.32 | % | ||||||||||||||
Interest bearing deposits in other banks | 58,269 | 97 | 0.68 | % | 73,188 | 84 | 0.46 | % | ||||||||||||||
Other earning assets (2) | 29,053 | 357 | 4.98 | % | 25,136 | 315 | 5.04 | % | ||||||||||||||
Total interest earning assets | 8,998,422 | $ | 93,519 | 4.21 | % | 6,832,335 | $ | 69,891 | 4.11 | % | ||||||||||||
Non-interest earning assets | 909,138 | 618,087 | ||||||||||||||||||||
Total assets | $ | 9,907,560 | $ | 7,450,422 | ||||||||||||||||||
Interest bearing liabilities | ||||||||||||||||||||||
Time deposits | $ | 2,141,806 | $ | 4,539 | 0.86 | % | $ | 1,689,653 | $ | 4,120 | 0.98 | % | ||||||||||
Money market | 1,777,343 | 1,756 | 0.40 | % | 1,247,333 | 1,067 | 0.34 | % | ||||||||||||||
Interest bearing demand | 1,922,687 | 1,138 | 0.24 | % | 1,370,957 | 648 | 0.19 | % | ||||||||||||||
Savings | 494,538 | 220 | 0.18 | % | 419,588 | 227 | 0.22 | % | ||||||||||||||
Total interest bearing deposits | 6,336,374 | 7,653 | 0.49 | % | 4,727,531 | 6,062 | 0.52 | % | ||||||||||||||
Short-term borrowings and FHLB advances | 493,643 | 887 | 0.73 | % | 460,892 | 532 | 0.46 | % | ||||||||||||||
Long-term borrowings | 116,744 | 2,281 | 7.92 | % | 85,986 | 1,511 | 7.07 | % | ||||||||||||||
Total interest bearing liabilities | 6,946,761 | 10,821 | 0.63 | % | 5,274,409 | 8,105 | 0.62 | % | ||||||||||||||
Non-interest bearing demand | 1,595,695 | 1,138,782 | ||||||||||||||||||||
Other liabilities | 65,753 | 42,418 | ||||||||||||||||||||
Shareholders’ equity | 1,299,351 | 994,813 | ||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 9,907,560 | $ | 7,450,422 | ||||||||||||||||||
Net interest income and spread | $ | 82,698 | 3.58 | % | $ | 61,786 | 3.50 | % | ||||||||||||||
Net interest margin | 3.73 | % | 3.64 | % | ||||||||||||||||||
(1) Presented on a fully tax equivalent basis
(2) Includes Federal Home Loan Bank stocks
- MORE -
CBF Reports First Quarter Results
Page 11
April 21, 2017
CAPITAL BANK FINANCIAL CORP.
RECONCILIATION OF NON-GAAP MEASURES
(Dollars in thousands)
(Unaudited)
CORE NET INCOME | Three Months Ended | |||||||||||||||||||||||
Mar 31, 2017 | Dec 31, 2016 | Mar 30, 2016 | ||||||||||||||||||||||
Net Income | $ | 20,883 | $ | 20,883 | $ | 12,434 | $ | 12,434 | $ | 9,840 | $ | 9,840 | ||||||||||||
Pre-Tax | After-Tax | Pre-Tax | After-Tax | Pre-Tax | After-Tax | |||||||||||||||||||
Adjustments | ||||||||||||||||||||||||
Non-interest income | ||||||||||||||||||||||||
Indemnification asset termination | — | — | — | — | 9,178 | 5,670 | ||||||||||||||||||
Security (gains) losses* | (67 | ) | (41 | ) | (1,894 | ) | (1,170 | ) | (40 | ) | (25 | ) | ||||||||||||
Non-interest expense | ||||||||||||||||||||||||
Legal Settlement | — | — | 1,361 | 841 | — | — | ||||||||||||||||||
Tax Adjustment | — | — | (1,350 | ) | (1,350 | ) | — | — | ||||||||||||||||
Severance expense* | — | — | 7 | 4 | 75 | 46 | ||||||||||||||||||
Restructuring expense* | 1,912 | 1,181 | 4 | 3 | 142 | 88 | ||||||||||||||||||
Conversion costs and merger tax deductible* | 3,037 | 1,877 | 18,245 | 11,270 | 1,107 | 684 | ||||||||||||||||||
Legal merger non deductible | — | — | 280 | 280 | 580 | 580 | ||||||||||||||||||
Tax effect of adjustments* | (1,865 | ) | N/A | (6,775 | ) | N/A | (3,999 | ) | N/A | |||||||||||||||
Core Net Income | $ | 23,900 | $ | 23,900 | $ | 22,312 | $ | 22,312 | $ | 16,883 | $ | 16,883 | ||||||||||||
Diluted shares | 53,127 | 50,387 | 43,904 | |||||||||||||||||||||
Core Net Income per share | $ | 0.45 | $ | 0.44 | $ | 0.38 | ||||||||||||||||||
Average Assets | 9,907,560 | 9,329,334 | 7,450,422 | |||||||||||||||||||||
ROA** | 0.84 | % | 0.53 | % | 0.53 | % | ||||||||||||||||||
Core ROA*** | 0.96 | % | 0.96 | % | 0.91 | % | ||||||||||||||||||
* Tax effected at an income tax rate of 38%
** ROA: Annualized net income / Average assets
*** Core ROA: Annualized core net income / Average assets
- MORE -
CBF Reports First Quarter Results
Page 12
April 21, 2017
CAPITAL BANK FINANCIAL CORP.
RECONCILIATION OF NON-GAAP MEASURES (Continuation)
(Dollars in thousands)
(Unaudited)
CORE EFFICIENCY RATIO | Three Months Ended | ||||||||||||||||||
Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | |||||||||||||||
Net interest income | $ | 82,116 | $ | 77,819 | $ | 62,627 | $ | 61,515 | $ | 61,367 | |||||||||
Reported non-interest income | 15,852 | 17,016 | 12,370 | 11,922 | 2,566 | ||||||||||||||
Indemnification asset termination | — | — | — | — | (9,178 | ) | |||||||||||||
Less: Securities gains (losses) | 67 | 1,894 | 71 | 117 | 40 | ||||||||||||||
Core non-interest income | $ | 15,785 | $ | 15,122 | $ | 12,299 | $ | 11,805 | $ | 11,704 | |||||||||
Reported non-interest expense | $ | 62,703 | $ | 73,994 | $ | 47,530 | $ | 44,536 | $ | 46,938 | |||||||||
Less: Severance expense | — | 7 | — | — | 75 | ||||||||||||||
Conversion costs and merger tax deductible | 3,037 | 18,245 | 331 | 881 | 1,107 | ||||||||||||||
Legal settlement | — | 1,361 | 1,500 | — | — | ||||||||||||||
Legal merger non deductible | — | 280 | 61 | 355 | 580 | ||||||||||||||
Restructuring expense | 1,912 | 4 | (113 | ) | 5 | 142 | |||||||||||||
Contract termination | — | — | — | — | — | ||||||||||||||
Conversion and severance expenses (conversion and merger expenses and salaries and employees benefits) | — | — | — | — | — | ||||||||||||||
Core non-interest expense | $ | 57,754 | $ | 54,097 | $ | 45,751 | $ | 43,295 | $ | 45,034 | |||||||||
Efficiency ratio* | 64.00 | % | 78.02 | % | 63.38 | % | 60.65 | % | 73.42 | % | |||||||||
Core efficiency ratio** | 58.99 | % | 58.21 | % | 61.06 | % | 59.05 | % | 61.63 | % | |||||||||
* Efficiency Ratio: Non-interest expense / (Non-interest income + Net interest income)
** Core Efficiency Ratio: Core non-interest expense / (Core non-interest income + Net interest income)
- MORE -
CBF Reports First Quarter Results
Page 13
April 21, 2017
CAPITAL BANK FINANCIAL CORP.
RECONCILIATION OF NON-GAAP MEASURES (Continuation)
(Dollars and shares in thousands, except per share data)
(Unaudited)
* Tangible book value is equal to book value less goodwill and core deposit intangibles, net of related deferred tax liabilities.
TANGIBLE BOOK VALUE | Three Months Ended | |||||||||||||||||||
Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | ||||||||||||||||
Total shareholders’ equity | $ | 1,307,931 | $ | 1,292,047 | $ | 1,029,841 | $ | 1,016,498 | $ | 996,993 | ||||||||||
Less: goodwill and intangible assets, net of taxes | (253,708 | ) | (256,176 | ) | (142,141 | ) | (142,725 | ) | (143,304 | ) | ||||||||||
Tangible book value* | $ | 1,054,223 | $ | 1,035,871 | $ | 887,700 | $ | 873,773 | $ | 853,689 | ||||||||||
Common shares outstanding | 51,966 | 51,765 | 43,235 | 43,219 | 43,189 | |||||||||||||||
Tangible book value per share | $ | 20.29 | $ | 20.01 | $ | 20.53 | $ | 20.22 | $ | 19.77 | ||||||||||
TANGIBLE COMMON EQUITY RATIO | Three Months Ended | |||||||||||||||||||
Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | ||||||||||||||||
Total shareholders’ equity | $ | 1,307,931 | $ | 1,292,047 | $ | 1,029,841 | $ | 1,016,498 | $ | 996,993 | ||||||||||
Less: goodwill and intangible assets | (265,711 | ) | (268,870 | ) | (146,810 | ) | (147,753 | ) | (148,688 | ) | ||||||||||
Tangible common equity | $ | 1,042,220 | $ | 1,023,177 | $ | 883,031 | $ | 868,745 | $ | 848,305 | ||||||||||
Total assets | $ | 10,098,042 | $ | 9,930,657 | $ | 7,792,458 | $ | 7,621,225 | $ | 7,479,798 | ||||||||||
Less: goodwill and intangible assets | (265,711 | ) | (268,870 | ) | (146,810 | ) | (147,753 | ) | (148,688 | ) | ||||||||||
Tangible assets | $ | 9,832,331 | $ | 9,661,787 | $ | 7,645,648 | $ | 7,473,472 | $ | 7,331,110 | ||||||||||
Tangible common equity ratio | 10.60 | % | 10.59 | % | 11.55 | % | 11.62 | % | 11.57 | % | ||||||||||