Exhibit 99.1

 

 

 

 

Park Sterling Corporation Announces

Results for Third Quarter 2017

 

 

Charlotte, NC – October 26, 2017 – Park Sterling Corporation (NASDAQ: PSTB), the holding company for Park Sterling Bank, today released unaudited results of operations and other financial information for the third quarter of 2017. Financial results for the third quarter of 2017 include:

 

●	Net income of $8.7 million, or $0.16 per share, compared to $8.5 million, or $0.16 per share, in the quarter ended June 30, 2017, and $6.3 million, or $0.12 per share, in the quarter ended September 30, 2016

●	Adjusted net income (non-GAAP), which excludes merger-related expenses and gain on sale of securities, was $9.2 million, or $0.17 per share, compared to $9.2 million, or $0.17 per share in the prior quarter, and $7.3 million, or $0.14 per share, in the quarter ended September 30, 2016

●	Reported annualized returns on average assets and equity for the third quarter 2017 were 1.05% and 9.21%, respectively, while adjusted annualized returns on average assets and average equity (non-GAAP) were 1.11% and 9.75%, respectively

●	Noninterest income decreased $39 thousand from the prior quarter, with a decrease in mortgage banking income mostly offset by growth in capital markets income

●	Noninterest expenses totaled $20.1 million, a decrease of $1.3 million from the prior quarter; adjusted noninterest expenses (non-GAAP), which excludes merger-related expenses, decreased $1.0 million from the prior quarter

●	Nonperforming loans declined to a very low level of 0.40% of total loans

●	Capital levels remained strong with a Tier 1 leverage ratio of 10.36%

●	The Board of Directors declared a quarterly cash dividend on common shares of $0.04 per share (October 2017)

 

“We are pleased with our financial results for the third quarter, during which time we focused on several projects in preparation for our pending combination with South State Corporation,” said Jim Cherry, Chief Executive Officer. “We look forward to completing the merger, and we are very excited about the opportunity to create a premier regional banking franchise in the southeast.”

 

Financial Results

 

Income Statement – Three Months Ended September 30, 2017

 

Park Sterling reported net income of $8.7 million, or $0.16 per share, for the three months ended September 30, 2017 (“2017Q3”). This compares to net income of $8.5 million, or $0.16 per share, for the three months ended June 30, 2017 (“2017Q2”) and net income of $6.3 million, or $0.12 per share, for the three months ended September 30, 2016 (“2016Q3”). The increase in net income from 2017Q2 resulted primarily from decreases in operating expenses, merger-related expenses and provision for loan losses, partially offset by a decrease in interest income on earning assets and an increase in income tax expense. The increase in net income from 2016Q3 was primarily a result of an increase in net interest income, a decrease in provision for loan losses and a decrease in merger-related expenses, partially offset by an increase in income taxes.

 

Net interest income totaled $27.8 million in 2017Q3, which represents a $0.8 million, or 3%, decrease from $28.6 million in 2017Q2 and a $2.0 million, or 8%, increase from $25.8 million in 2016Q3. Average total earning assets decreased $21 million in 2017Q3 to $3.03 billion, compared to $3.05 billion in 2017Q2 and increased $127 million, or 4%, compared to $2.90 billion in 2016Q3. The decrease in average total earning assets in 2017Q3 from 2017Q2 included a decrease in average loans (including loans held for sale) of $16 million, or 2.6% annualized, a decrease in average marketable securities of $21 million, and an increase in average other interest-earning assets of $16 million. The reduction in average total earning assets reflects actions in preparation for the merger to use cash flows from maturing investments and loans that are not closely tied to customer relationships to reduce brokered deposits and borrowed funds. Additionally, the reduction reflects a lower level of new business activity in light of the pending merger and our focus on maintaining our existing customers. The increase in average total earning assets in 2017Q3 from 2016Q3 resulted primarily from a $115 million, or 5%, increase in average loans (including loans held for sale), a $16 million, or 3%, decrease in average marketable securities and a $28 million, or 53%, increase in average other interest-earning assets.

 

 

Net interest margin was 3.65% in 2017Q3, representing a 12 basis point decrease from 3.77% in 2017Q2 and an 11 basis point increase from 3.54% in 2016Q3. The decrease in net interest margin from 2017Q2 resulted primarily from a 12 basis point decrease in loan yields resulting from a reduction in the interest income accretion on acquired loans, as well as a 10 basis point increase in the cost of borrowed funds, which reflected the increase in market interest rates. The increase in net interest margin from 2016Q3 was primarily the result of a 17 basis point increase in loan yields and an improved yield on investment securities, partially offset by an increase in the cost of interest-bearing liabilities.

 

The Company reported a recovery of loan losses of $353 thousand in 2017Q3, compared to no provision recorded in 2017Q2, and $642 thousand of provision for loan losses recorded in 2016Q3. Allowance for loan loss levels remained at 0.51% of total loans at 2017Q3, unchanged from 2017Q2.

 

Noninterest income totaled $5.4 million in 2017Q3, which was essentially unchanged compared to both 2017Q2 and 2016Q3. The $39 thousand decrease from 2017Q2 is primarily the result of a $305 thousand decrease in mortgage banking income partially offset by a $282 thousand increase in capital markets income. The $68 thousand decrease in noninterest income from 2016Q3 reflects a decrease in mortgage banking and wealth management income of $545 thousand and $121 thousand, respectively, offset by a $247 thousand increase in capital markets income, as well as the absence of $139 thousand in amortization of FDIC indemnification asset recorded in 2016Q3.

 

Noninterest expense decreased $1.3 million, or 6%, to $20.1 million in 2017Q3 from $21.4 million in 2017Q2, and decreased $1.0 million, or 5%, compared to $21.1 million in 2016Q3. The decrease in noninterest expense from 2017Q2 resulted primarily from a $331 thousand decrease in merger-related expenses incurred in the third quarter as compared to the second quarter, as well as a decrease in salary and employee benefits of $330 thousand, a decrease in the net cost of OREO of $221 thousand, and a decrease in legal and professional fees of $219 thousand. The decrease in noninterest expenses from 2016Q3 was due primarily to a decrease in merger-related expenses of $895 thousand.

 

The Company’s effective tax rate was 35.2% in 2017Q3, compared to 32.2% in 2017Q2 and 33.5% in 2016Q3. The increase in the effective tax rate was primarily a result of non-deductible merger-related expenses.

 

Balance Sheet

 

Total assets decreased $93.7 million, or 11% annualized, to $3.25 billion at 2017Q3, compared to total assets of $3.34 billion at 2017Q2. Total securities, including non-marketable securities, decreased $22.8 million, to $488.7 million. Total loans, excluding loans held for sale, decreased $72.5 million, or 12% annualized, to $2.43 billion at 2017Q3.

 

The mix of commercial and consumer loans remained largely consistent with 2017Q2. Total commercial loans decreased $73.0 million and represent 78% of the loan portfolio. Acquisition, construction and development loans increased $0.3 million and represent 13.9% of the portfolio, up from 13.5% at 2017Q2. Total consumer loans increased $0.3 million and increased as a percentage of total loans to 22% of the portfolio compared to 21% at 2017Q2.

 

Total deposits decreased $68.3 million, or 11% annualized, to $2.47 billion at 2017Q3. Noninterest bearing demand deposits decreased $4.2 million, or 3% annualized, to $550.2 million from 2017Q2. Money market, NOW and savings deposits were down $30.8 million from 2017Q2 and represent 51% of total deposits. Time deposits decreased $33.3 million to $658.4 million at 2017Q3.

 

 

Total borrowings decreased $34.8 million, or 35% annualized, to $373.8 million at 2017Q3 compared to $408.6 million at 2017Q2. At 2017Q3, FHLB borrowings totaled $310 million, the senior unsecured term loan at the holding company totaled $29.8 million, and acquired subordinated debt, net of acquisition accounting fair value marks, totaled $34.0 million.

 

Total shareholders’ equity increased $7.4 million to $376.7 million at 2017Q3 compared to $369.3 million at 2017Q2, driven by a $6.6 million increase in retained earnings and an increase of $0.3 million in accumulated other comprehensive income. The change in accumulated other comprehensive income was caused by the effect of market interest rates on the fair value of available for sale investment securities.

 

The Company’s capital ratios remain strong at September 30, 2017 with the Common Equity Tier 1 (“CET1”) ratio at 11.59% and the Tier 1 leverage ratio at 10.36%.

 

Asset Quality

 

Asset quality remains strong. Nonperforming assets were $12.2 million at 2017Q3, or 0.38% of total assets, compared to $15.1 million at 2017Q2, or 0.45% of total assets. Nonperforming loans were $9.6 million at 2017Q3, and represented 0.40% of total loans, compared to $12.0 million at 2017Q2, or 0.48% of total loans. The Company reported net recoveries of $74 thousand, or 0.01% of average loans (annualized), in 2017Q3, compared to net charge-offs of $131 thousand, or 0.02% of average loans (annualized), in 2017Q2.

 

The allowance for loan losses decreased $279 thousand, or 2%, to $12.4 million, or 0.51% of total loans, at 2017Q3, compared to $12.7 million, or 0.51% of total loans, at 2017Q2. The decrease in the allowance from 2017Q2 is primarily attributable to the decrease in the loan balances at the end of the period.

 

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About Park Sterling Corporation

Park Sterling Corporation, the holding company for Park Sterling Bank, is headquartered in Charlotte, North Carolina. Park Sterling, a regional community-focused financial services company with $3.2 billion in assets, is the largest community bank headquartered in the Charlotte area and has 54 banking offices stretching across the Carolinas and into North Georgia, as well as in Richmond, Virginia. The bank serves professionals, individuals, and small and mid-sized businesses by offering a full array of financial services, including deposit, mortgage banking, cash management, consumer and business finance, capital markets and wealth management services with a commitment to “Answers You Can Bank On^SM.” Park Sterling prides itself on being large enough to help customers achieve their financial aspirations, yet small enough to care that they do. Park Sterling is focused on building a banking franchise that is noted for sound risk management, strong community focus and exceptional customer service. For more information, visit www.parksterlingbank.com. Park Sterling Corporation shares are traded on NASDAQ under the symbol PSTB.

 

Non-GAAP Financial Measures

Tangible assets, tangible common equity, tangible book value, average tangible common equity, adjusted net income, adjusted operating revenues, adjusted noninterest income, adjusted noninterest expenses, adjusted operating expense, adjusted allowance for loan losses, and related ratios and per share measures, including adjusted return on average assets and adjusted return on average equity, as used throughout this release, are non-GAAP financial measures. For additional information, see “Reconciliation of Non-GAAP Financial Measures” in the accompanying tables.

 

 

Cautionary Statement Regarding Forward-Looking Statements

Statements included in this communication which are not historical in nature or do not relate to current facts are intended to be, and are hereby identified as, forward-looking statements for purposes of the safe harbor provided by Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The words “may,” “will,” “anticipate,” “could,” “should,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “plan,” “project” and “intend,” as well as other similar words and expressions of the future, are intended to identify forward-looking statements. South State Corporation (“South State”) and Park Sterling Corporation (“Park Sterling” or the “Company”) caution readers that forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from anticipated results. Such risks and uncertainties, include, among others, the following possibilities: the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the definitive merger agreement between South State and Park Sterling; the outcome of any legal proceedings that may be instituted against South State or Park Sterling; the failure to obtain necessary regulatory approvals (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the transaction) or to satisfy any of the other conditions to the transaction on a timely basis or at all; the possibility that the anticipated benefits of the transaction are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where South State and Park Sterling do business; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; diversion of management’s attention from ongoing business operations and opportunities; potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the transaction; South State’s ability to complete the acquisition and integrate Park Sterling successfully; inability to generate future organic growth in loan balances, retail banking, wealth management, mortgage banking or capital markets results through the hiring of new personnel, development of new products, including new online and mobile banking platforms for treasury services, opening of de novo branches or otherwise in a timely, cost-efficient manner; inability to capitalize on identified revenue enhancements or expense management opportunities, including the inability to achieve or maintain adjusted operating expense to adjusted operating revenue targets; failure of assumptions underlying noninterest expense levels; failure of assumptions underlying the establishment of the allowance for loan losses; deterioration in the value of securities held in the investment securities portfolio; the Company’s ability to fully realize the value of its net deferred tax asset, including the impact of lower federal income tax rates on the carrying amount or the risk that the Company may be required to establish a valuation allowance; uncertainties about the financial stability and growth rates of non-U.S. jurisdictions, the risk that those jurisdictions may face difficulties servicing their sovereign debt, and related stresses on the financial, credit and real estate markets generally, which could negatively impact the Company’s revenues and the value of its assets and liabilities; changes in general economic or business conditions, customer behavior and other uncertainties that could lead to reduced revenues and deterioration in the credit quality of the loan portfolio or the value of the collateral securing those loans and result in higher credit losses than currently expected; sensitivity to the interest rate environment, including continued low interest rates, a rapid increase in interest rates or a change in the shape of the yield curve, and the impact on net interest margins; cyber-security events; failure to anticipate or inability to adapt to rapid technological developments and changes; fluctuations in the market price of the common stock, regulatory, legal and contractual requirements, other uses of capital, financial performance, market conditions generally, and future actions by the board of directors, in each case impacting repurchases of common stock or declaration of dividends; the impact of implementation of legal and regulatory developments, including changes in the federal risk-based capital rules; increased competition from both banks and nonbanks; changes in accounting standards, rules and interpretations, inaccurate estimates or assumptions in accounting, including acquisition accounting fair market value assumptions and accounting for purchased credit-impaired loans, and the impact on Park Sterling’s financial statements; and management’s ability to effectively manage credit risk, market risk, operational risk, legal risk, and regulatory and compliance risk; and other factors that may affect future results of South State and Park Sterling. Additional factors that could cause results to differ materially from those described above can be found in South State’s Annual Report on Form 10-K for the year ended December 31, 2016, which is on file with the Securities and Exchange Commission (the “SEC”) and available in the “Investor Relations” section of South State’s website, http://www.southstatebank.com, under the heading “SEC Filings” and in other documents South State files with the SEC, and in Park Sterling’s Annual Report on Form 10-K for the year ended December 31, 2016, which is on file with the SEC and available on the “Investor Relations” page linked to Park Sterling’s website, http://www.parksterlingbank.com, under the heading “Regulatory Filings” and in other documents Park Sterling files with the SEC.

 

All forward-looking statements speak only as of the date they are made and are based on information available at that time. Neither South State nor Park Sterling assumes any obligation to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements were made or to reflect the occurrence of unanticipated events except as required by federal securities laws. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements.

 

IMPORTANT ADDITIONAL INFORMATION

In connection with the proposed transaction between South State and Park Sterling, South State has filed with the SEC a Registration Statement on Form S-4 that includes a Joint Proxy Statement of South State and Park Sterling and a Prospectus of South State, as well as other relevant documents concerning the proposed transaction. The Registration Statement was declared effective by the SEC on September 6, 2017, and Park Sterling and South State subsequently mailed a definitive Joint Proxy Statement/Prospectus to their respective shareholders. The proposed transaction involving South State and Park Sterling was approved by Park Sterling’s shareholders and South State’s shareholders at a special meeting of shareholders of Park Sterling and a special meeting of shareholders of South State, each of which was held on October 25, 2017. This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. Shareholders of South State and shareholders of Park Sterling are urged to read the registration statement and the joint proxy statement/prospectus regarding the transaction and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information.

 

 

Shareholders can obtain a free copy of the definitive joint proxy statement/prospectus, as well as other filings containing information about South State and Park Sterling, without charge, at the SEC’s website (http://www.sec.gov). Copies of the joint proxy statement/prospectus and the filings with the SEC that are incorporated by reference in the joint proxy statement/prospectus can also be obtained, without charge, by directing a request to South State Corporation, 520 Gervais Street, Columbia, South Carolina 29201, Attention: John C. Pollok, Senior Executive Vice President, CFO and COO, (800) 277-2175 or to Park Sterling Corporation, 1043 E. Morehead Street, Suite 201, Charlotte, North Carolina 28204, Attention: Donald K. Truslow, (704) 323-4292.

 

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For additional information contact:

Donald K. Truslow

Chief Financial Officer

(704) 716-2134

don.truslow@parksterlingbank.com 

 

 

PARK STERLING CORPORATION
CONDENSED CONSOLIDATED INCOME STATEMENT
THREE MONTH RESULTS
($ in thousands, except per share amounts)		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016				2016
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Interest income
Loans, including fees		$	28,923			$	29,518			$	27,462			$	27,066			$	26,521
Taxable investment securities			2,809				2,985				2,935				2,793				2,583
Tax-exempt investment securities			132				135				135				135				137
Nonmarketable equity securities			225				219				198				163				151
Interest on deposits at banks			199				109				89				54				51
Federal funds sold			2				2				2				1				1
Total interest income			32,290				32,968				30,821				30,212				29,444
Interest expense
Money market, NOW and savings deposits			1,076				1,031				967				941				953
Time deposits			1,468				1,482				1,425				1,469				1,447
Short-term borrowings			986				922				501				361				345
Long-term debt			371				371				371				371				379
Subordinated debt			555				552				499				499				497
Total interest expense			4,456				4,358				3,763				3,641				3,621
Net interest income			27,834				28,610				27,058				26,571				25,823
Provision for (recovery of) loan losses			(353	)			-				678				550				642
Net interest income after provision (recovery)			28,187				28,610				26,380				26,021				25,181
Noninterest income
Service charges on deposit accounts			1,737				1,725				1,682				1,761				1,671
Mortgage banking income			470				775				961				765				1,015
Income from wealth management activities			618				689				649				682				739
Income from capital market activities			927				645				609				1,070				680
ATM and card income			741				751				714				713				730
Income from bank-owned life insurance			576				578				578				663				532
Gain (loss) on sale of securities available for sale			-				-				58				6				-
Amortization of indemnification asset and true-up liability expense			-				-				-				-				(139	)
Other noninterest income			310				255				217				185				219
Total noninterest income			5,379				5,418				5,468				5,845				5,447
Noninterest expenses
Salaries and employee benefits			11,058				11,388				11,483				11,480				11,755
Occupancy and equipment			3,007				2,924				2,907				3,577				3,111
Data processing and outside service fees			2,049				1,907				1,925				2,105				2,331
Legal and professional fees			954				1,650				783				869				978
Deposit charges and FDIC insurance			378				442				485				391				405
Loss on disposal of fixed assets			-				-				24				2,175				144
Communication fees			345				460				463				504				532
Postage and supplies			106				107				142				125				115
Loan and collection expense			175				210				117				57				425
Core deposit intangible amortization			454				454				454				458				458
Advertising and promotion			179				140				146				254				44
Net cost of operation of other real estate owned			19				240				175				11				(92	)
Other noninterest expense			1,417				1,527				1,538				3,019				906
Total noninterest expenses			20,141				21,449				20,642				25,025				21,112
Income before income taxes			13,425				12,579				11,206				6,841				9,516
Income tax expense			4,731				4,052				3,717				1,510				3,192
Net income		$	8,694			$	8,527			$	7,489			$	5,331			$	6,324
Earnings per common share, fully diluted		$	0.16			$	0.16			$	0.14			$	0.10			$	0.12
Weighted average diluted common shares			53,527,283				53,481,846				53,462,857				53,155,493				52,743,928

 

 

PARK STERLING CORPORATION
CONDENSED CONSOLIDATED INCOME STATEMENT
NINE MONTH RESULTS
($ in thousands, except per share amounts)		September 30,				September 30,
		2017				2016
		(Unaudited)				(Unaudited)
Interest income
Loans, including fees		$	85,903			$	80,374
Taxable investment securities			8,729				7,910
Tax-exempt investment securities			402				421
Nonmarketable equity securities			642				458
Interest on deposits at banks			397				127
Federal funds sold			6				14
Total interest income			96,079				89,304
Interest expense
Money market, NOW and savings deposits			3,074				2,984
Time deposits			4,375				4,294
Short-term borrowings			2,409				890
Long-term debt			1,113				1,229
Subordinated debt			1,606				1,437
Total interest expense			12,577				10,834
Net interest income			83,502				78,470
Provision for loan losses			325				2,080
Net interest income after provision			83,177				76,390
Noninterest income
Service charges on deposit accounts			5,144				4,688
Mortgage banking income			2,206				2,663
Income from wealth management activities			1,956				2,405
Income from capital market activities			2,181				1,515
ATM and card income			2,206				2,079
Income from bank-owned life insurance			1,732				2,046
Gain (loss) on sale of securities available for sale			58				(93	)
Amortization of indemnification asset and true-up liability expense			-				(311	)
Other noninterest income			782				557
Total noninterest income			16,265				15,549
Noninterest expenses
Salaries and employee benefits			33,929				36,547
Occupancy and equipment			8,838				9,277
Data processing and outside service fees			5,881				10,078
Legal and professional fees			3,387				2,653
Deposit charges and FDIC insurance			1,305				1,315
Loss on disposal of fixed assets			24				418
Communication fees			1,268				1,520
Postage and supplies			355				479
Loan and collection expense			502				735
Core deposit intangible amortization			1,362				1,374
Advertising and promotion			465				832
Net cost of operation of other real estate owned			434				244
Other noninterest expense			4,482				3,739
Total noninterest expenses			62,232				69,211
Income before income taxes			37,210				22,728
Income tax expense			12,500				8,111
Net income		$	24,710			$	14,617
Earnings per common share, fully diluted		$	0.46			$	0.28
Weighted average diluted common shares			53,481,351				52,674,315

 

 

PARK STERLING CORPORATION
WEALTH MANAGEMENT ASSETS
($ in thousands)
		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016				2016
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Discretionary assets held		$	242,779			$	256,623			$	288,250			$	278,872			$	294,849
Non-discretionary assets held			27,020				27,274				44,996				36,522				28,476
Total wealth management assets		$	269,799			$	283,897			$	333,246			$	315,394			$	323,325

 

PARK STERLING CORPORATION
MORTGAGE ORIGINATION
($ in thousands)
		for the three month period ended
		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016				2016
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Mortgage origination - purchase		$	13,782			$	16,180			$	18,446			$	14,767			$	21,982
Mortgage origination - refinance			5,560				8,609				16,068				21,316				20,552
Mortgage origination - construction			11,056				22,441				16,823				18,535				19,440
Total mortgage origination		$	30,398			$	47,230			$	51,337			$	54,618			$	61,974

 

 

PARK STERLING CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
($ in thousands)		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016*				2016
		(Unaudited)				(Unaudited)				(Unaudited)								(Unaudited)
ASSETS
Cash and due from banks		$	44,874			$	35,508			$	40,081			$	34,162			$	35,066
Interest-earning balances at banks			53,102				55,862				32,997				48,882				38,540
Investment securities available for sale			384,275				403,602				423,345				402,501				405,010
Investment securities held to maturity			85,704				87,690				89,579				91,752				99,415
Nonmarketable equity securities			18,692				20,179				19,967				17,501				16,289
Federal funds sold			240				260				765				570				345
Loans held for sale			1,814				3,102				6,181				7,996				15,203
Loans			2,429,585				2,502,120				2,460,595				2,412,186				2,368,950
Allowance for loan losses			(12,423	)			(12,702	)			(12,833	)			(12,125	)			(11,612	)
Net loans			2,417,162				2,489,418				2,447,762				2,400,061				2,357,338
Premises and equipment, net			61,823				62,779				62,392				63,080				64,632
Other real estate owned			2,603				3,175				3,167				2,438				2,730
Bank-owned life insurance			72,354				71,831				71,337				70,785				70,167
Deferred tax asset			18,728				20,790				21,250				25,721				26,947
Goodwill			63,317				63,317				63,317				63,317				63,030
Core deposit intangible			10,075				10,530				10,984				11,438				11,896
Other assets			12,490				12,956				15,632				15,192				20,330
Total assets		$	3,247,253			$	3,340,999			$	3,308,756			$	3,255,396			$	3,226,938
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Demand noninterest-bearing		$	550,196			$	554,399			$	524,380			$	521,295			$	505,591
Money market, NOW and savings			1,260,334				1,291,127				1,277,986				1,251,385				1,228,687
Time deposits			658,393				691,656				706,829				741,072				749,999
Total deposits			2,468,923				2,537,182				2,509,195				2,513,752				2,484,277
Short-term borrowings			310,000				345,000				340,000				285,000				280,000
Long-term debt			29,769				29,758				29,747				29,736				29,725
Subordinated debt			33,996				33,832				33,671				33,501				33,339
Accrued expenses and other liabilities			27,876				25,963				34,423				37,562				40,901
Total liabilities			2,870,564				2,971,735				2,947,036				2,899,551				2,868,242
Shareholders' equity:
Common stock			53,365				53,280				53,113				53,117				53,306
Additional paid-in capital			273,893				273,409				273,291				273,400				275,323
Retained earnings			50,937				44,375				37,977				32,608				29,409
Accumulated other comprehensive income (loss)			(1,506	)			(1,800	)			(2,661	)			(3,280	)			658
Total shareholders' equity			376,689				369,264				361,720				355,845				358,696
Total liabilities and shareholders' equity		$	3,247,253			$	3,340,999			$	3,308,756			$	3,255,396			$	3,226,938
Common shares issued and outstanding			53,364,798				53,279,996				53,112,726				53,116,519				53,305,834

 

  * Derived from audited financial statements.

 

 

 

PARK STERLING CORPORATION
SUMMARY OF LOAN PORTFOLIO
($ in thousands)
		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016*				2016
BY LOAN TYPE		(Unaudited)				(Unaudited)				(Unaudited)								(Unaudited)
Commercial:
Commercial and industrial		$	411,233			$	454,952			$	430,247			$	387,401			$	351,506
Commercial real estate (CRE) - owner-occupied			364,345				361,213				360,318				367,553				366,506
CRE - investor income producing			769,405				801,698				770,404				743,107				768,513
Acquisition, construction and development (AC&D) - 1-4 Family Construction			84,971				95,236				85,025				82,707				108,706
AC&D - Lots and land			91,676				92,761				98,339				105,362				88,620
AC&D - CRE construction			161,810				150,170				186,325				194,732				148,696
Other commercial			15,266				15,712				12,743				12,900				10,653
Total commercial loans			1,898,706				1,971,742				1,943,401				1,893,762				1,843,200
Consumer:
Residential mortgage			287,596				283,911				273,624				260,521				254,298
Home equity lines of credit			172,240				173,840				170,709				176,799				181,246
Residential construction			50,484				52,222				52,631				59,060				63,847
Other loans to individuals			17,061				17,133				16,936				18,905				23,281
Total consumer loans			527,381				527,106				513,900				515,285				522,672
Total loans			2,426,087				2,498,848				2,457,301				2,409,047				2,365,872
Deferred costs (fees)			3,499				3,272				3,294				3,139				3,078
Total loans, net of deferred costs (fees)		$	2,429,586			$	2,502,120			$	2,460,595			$	2,412,186			$	2,368,950

 

 *  Derived from audited financial statements.

 

		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016*				2016
BY ACQUIRED AND NON-ACQUIRED		(Unaudited)				(Unaudited)				(Unaudited)								(Unaudited)
Acquired loans - performing		$	376,365			$	425,758			$	495,216			$	538,845			$	599,840
Acquired loans - purchase credit impaired			66,820				75,074				81,869				85,456				90,571
Total acquired loans			443,185				500,832				577,085				624,301				690,411
Non-acquired loans, net of deferred costs (fees)**			1,986,401				2,001,288				1,883,510				1,787,885				1,678,539
Total loans		$	2,429,586			$	2,502,120			$	2,460,595			$	2,412,186			$	2,368,950

 

*  Derived from audited financial statements.

** Includes loans transferred from acquired pools following release of acquisition accounting FMV adjustments.

 

 

 

PARK STERLING CORPORATION
ALLOWANCE FOR LOAN LOSSES
THREE MONTH RESULTS
($ in thousands)		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016*				2016
		(Unaudited)				(Unaudited)				(Unaudited)								(Unaudited)
Beginning of period allowance		$	12,702			$	12,833			$	12,125			$	11,612			$	10,873
Loans charged-off			(237	)			(329	)			(146	)			(223	)			(156	)
Recoveries of loans charged-off			311				198				176				186				253
Net (charge-offs) recoveries			74				(131	)			30				(37	)			97
Provision for (recovery of) loan losses			(353	)			-				678				550				642
End of period allowance		$	12,423			$	12,702			$	12,833			$	12,125			$	11,612
Net (charge-offs) recoveries		$	74			$	(131	)		$	30			$	(37	)		$	97
Net (charge-offs) recoveries to average loans (annualized)			0.01	%			-0.02	%			0.01	%			-0.01	%			0.02	%

 

*  Derived from audited financial statements.

 

 

PARK STERLING CORPORATION
ACQUIRED LOANS
($ in thousands)
		September 30,				June 30,				March 31,				December 31,				September 30,
ACQUIRED LOANS AND FAIR MARKET		2017				2017				2017				2016*				2016
VALUE (FMV) ADJUSTMENTS		(Unaudited)				(Unaudited)				(Unaudited)								(Unaudited)
Non-acquired loans		$	1,986,401			$	2,001,288			$	1,883,510			$	1,787,885			$	1,678,539
Purchased performing loans			378,857				428,404				498,314				542,269				604,000
Less: remaining FMV adjustments			(2,492	)			(2,646	)			(3,098	)			(3,424	)			(4,160	)
Purchased performing loans, net			376,365				425,758				495,216				538,845				599,840
Purchased credit impaired loans			86,784				94,613				104,416				109,805				115,736
Less: remaining FMV adjustments			(19,964	)			(19,539	)			(22,547	)			(24,349	)			(25,165	)
Purchased credit impaired loans, net			66,820				75,074				81,869				85,456				90,571
Total loans		$	2,429,586			$	2,502,120			$	2,460,595			$	2,412,186			$	2,368,950

 

 

		September 30,				June 30,				March 31,				December 31,				September 30,
PURCHASED PERFORMING FMV ADJUSTMENTS		2017				2017				2017				2016*				2016
		(Unaudited)				(Unaudited)				(Unaudited)								(Unaudited)
Beginning FMV adjustment		$	(2,646	)		$	(3,098	)		$	(3,424	)		$	(4,160	)		$	(4,964	)
Accretion to interest income:
First Capital			163				304				236				503				623
All other mergers			(9	)			148				90				233				181
Ending FMV adjustment		$	(2,492	)		$	(2,646	)		$	(3,098	)		$	(3,424	)		$	(4,160	)

 

 

		September 30,				June 30,				March 31,				December 31,				September 30,
PCI FMV ADJUSTMENTS		2017				2017				2017				2016*				2016
		(Unaudited)				(Unaudited)				(Unaudited)								(Unaudited)
Contractual principal and interest		$	99,815			$	109,655			$	119,970			$	125,512			$	133,223
Nonaccretable difference			(4,188	)			(4,312	)			(7,142	)			(10,448	)			(11,529	)
Expected cash flows as of the end of period			95,627				105,343				112,828				115,064				121,694
Accretable yield			(28,807	)			(30,269	)			(30,959	)			(29,608	)			(31,123	)
Ending basis in PCI loans- estimated fair value		$	66,820			$	75,074			$	81,869			$	85,456			$	90,571
Beginning accretable yield		$	(30,269	)		$	(30,959	)		$	(29,608	)		$	(31,123	)		$	(30,377	)
Loan system servicing income			1,916				1,318				1,413				1,389				1,532
Accretion to interest income			961				2,687				2,000				1,285				1,241
Reclass from non-accretable yield			(1,040	)			(2,699	)			(3,802	)			(929	)			(2,691	)
Other adjustments			(375	)			(616	)			(962	)			(230	)			(828	)
Period end accretable yield**		$	(28,807	)		$	(30,269	)		$	(30,959	)		$	(29,608	)		$	(31,123	)

 

*	Derived from audited financial statements.
**	Difference between the remaining FMV discount on purchased credit impaired loans and the period end accretable yield is a function of projected estimated expected interest income being included in the period end accretable yield.

 

 

PARK STERLING CORPORATION
AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS
THREE MONTHS
($ in thousands)		September 30, 2017												September 30, 2016
		Average				Income/				Yield/				Average				Income/				Yield/
		Balance				Expense				Rate (2)				Balance				Expense				Rate (2)
Assets
Interest-earning assets:
Loans and loans held for sale, net (1)		$	2,463,157			$	28,923				4.66	%		$	2,348,297			$	26,521				4.49	%
Fed funds sold			697				2				1.14	%			971				1				0.41	%
Taxable investment securities			468,621				2,809				2.40	%			483,815				2,583				2.12	%
Tax-exempt investment securities			13,049				132				4.05	%			14,013				137				3.89	%
Other interest-earning assets			81,181				424				2.07	%			53,088				202				1.51	%
Total interest-earning assets			3,026,705				32,290				4.23	%			2,900,184				29,444				4.04	%
Allowance for loan losses			(13,216	)											(11,054	)
Cash and due from banks			36,802												34,703
Premises and equipment			62,500												65,332
Goodwill			63,317												63,076
Intangible assets			10,281												12,120
Other assets			106,240												122,438
Total assets		$	3,292,629											$	3,186,799
Liabilities and shareholders' equity
Interest-bearing liabilities:
Interest-bearing demand		$	479,170			$	90				0.07	%		$	426,755			$	68				0.06	%
Savings and money market			739,704				625				0.34	%			744,930				777				0.41	%
Time deposits - core			598,652				1,226				0.81	%			653,937				1,179				0.72	%
Brokered deposits			136,000				603				1.76	%			156,867				376				0.95	%
Total interest-bearing deposits			1,953,526				2,544				0.52	%			1,982,489				2,400				0.48	%
Short-term borrowings			329,293				986				1.19	%			235,870				345				0.58	%
Long-term debt			29,764				371				4.95	%			29,718				379				5.07	%
Subordinated debt			33,914				555				6.49	%			33,262				497				5.94	%
Total borrowed funds			392,971				1,912				1.93	%			298,850				1,221				1.63	%
Total interest-bearing liabilities			2,346,497				4,456				0.75	%			2,281,339				3,621				0.63	%
Net interest rate spread							27,834				3.48	%							25,823				3.41	%
Noninterest-bearing demand deposits			544,402												502,158
Other liabilities			27,267												45,725
Shareholders' equity			374,463												357,577
Total liabilities and shareholders' equity		$	3,292,629											$	3,186,799
Net interest margin											3.65	%											3.54	%

 

(1)  Nonaccrual loans are included in the average loan balances.

(2) Yield/ rate calculated on Actual/Actual day count basis, except for yield on investments which is calculated on a 30/360 day count basis.

 

 

PARK STERLING CORPORATION
AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS
NINE MONTHS
($ in thousands)		September 30, 2017												September 30, 2016
		Average				Income/				Yield/				Average				Income/				Yield/
		Balance				Expense				Rate (2)				Balance				Expense				Rate (2)
Assets
Interest-earning assets:
Loans and loans held for sale, net (1)		$	2,455,429			$	85,903				4.68	%		$	2,307,380			$	80,374				4.65	%
Fed funds sold			812				6				0.99	%			3,894				14				0.48	%
Taxable investment securities			481,299				8,729				2.42	%			485,004				7,910				2.18	%
Tax-exempt investment securities			13,221				402				4.05	%			14,728				421				3.81	%
Other interest-earning assets			69,102				1,039				2.01	%			48,158				585				1.62	%
Total interest-earning assets			3,019,863				96,079				4.25	%			2,859,164				89,304				4.17	%
Allowance for loan losses			(12,788	)											(10,296	)
Cash and due from banks			36,825												35,488
Premises and equipment			62,759												65,956
Goodwill			63,317												62,881
Intangible assets			10,730												12,470
Other assets			108,713												125,951
Total assets		$	3,289,419											$	3,151,614
Liabilities and shareholders' equity
Interest-bearing liabilities:
Interest-bearing demand		$	474,747			$	263				0.07	%		$	426,659			$	235				0.07	%
Savings and money market			737,203				1,795				0.33	%			741,074				2,447				0.44	%
Time deposits - core			617,908				3,628				0.79	%			683,302				3,670				0.72	%
Brokered deposits			143,722				1,763				1.64	%			141,009				926				0.88	%
Total interest-bearing deposits			1,973,580				7,449				0.50	%			1,992,044				7,278				0.49	%
Short-term borrowings			323,077				2,409				1.00	%			197,043				890				0.60	%
Long-term debt			29,753				1,113				5.00	%			53,364				1,229				3.08	%
Subordinated debt			33,753				1,606				6.36	%			33,098				1,437				5.80	%
Total borrowed funds			386,583				5,128				1.77	%			283,505				3,556				1.68	%
Total interest-bearing liabilities			2,360,163				12,577				0.71	%			2,275,549				10,834				0.64	%
Net interest rate spread							83,502				3.54	%							78,470				3.54	%
Noninterest-bearing demand deposits			531,162												480,772
Other liabilities			31,346												42,396
Shareholders' equity			366,748												352,897
Total liabilities and shareholders' equity		$	3,289,419											$	3,151,614
Net interest margin											3.70	%											3.67	%

 

(1)  Nonaccrual loans are included in the average loan balances.

(2) Yield/ rate calculated on Actual/Actual day count basis, except for yield on investments which is calculated on a 30/360 day count basis.

 

 

PARK STERLING CORPORATION
SELECTED RATIOS
($ in thousands, except per share amounts)		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016				2016
		Unaudited				Unaudited				Unaudited				Unaudited				Unaudited
ASSET QUALITY
Nonaccrual loans		$	7,072			$	9,373			$	9,613			$	8,819			$	8,623
Troubled debt restructuring (and still accruing)			2,350				2,457				2,486				2,892				2,549
Past due 90 days plus (and still accruing)			206				133				-				1,230				293
Nonperforming loans			9,628				11,963				12,099				12,941				11,465
OREO			2,603				3,175				3,167				2,438				2,730
Nonperforming assets			12,231				15,138				15,266				15,379				14,195
Past due 30-59 days (and still accruing)			2,084				677				430				1,175				1,104
Past due 60-89 days (and still accruing)			234				332				587				1,836				2,558
Nonperforming loans to total loans			0.40	%			0.48	%			0.49	%			0.54	%			0.48	%
Nonperforming assets to total assets			0.38	%			0.45	%			0.46	%			0.47	%			0.44	%
Allowance to total loans			0.51	%			0.51	%			0.52	%			0.50	%			0.49	%
Allowance to nonperforming loans			129.03	%			106.18	%			106.07	%			93.69	%			101.28	%
Allowance to nonperforming assets			101.57	%			83.91	%			84.06	%			78.84	%			81.80	%
Past due 30-89 days (accruing) to total loans			0.10	%			0.04	%			0.04	%			0.12	%			0.15	%
Net charge-offs (recoveries) to average loans (annualized)			0.01	%			-0.02	%			0.01	%			-0.01	%			0.02	%
CAPITAL
Book value per common share		$	7.11			$	6.98			$	6.86			$	6.75			$	6.84
Tangible book value per common share**		$	5.72			$	5.58			$	5.45			$	5.33			$	5.41
Common shares outstanding			53,364,798				53,279,996				53,112,726				53,116,519				53,305,834
Weighted average dilutive common shares outstanding			53,527,283				53,481,846				53,462,857				53,155,493				52,743,928
Common Equity Tier 1 (CET1) capital		$	308,102			$	300,698			$	293,743			$	288,594			$	287,518
Tier 1 capital			334,006				326,415				319,274				314,043				312,781
Tier 2 capital			12,423				12,703				12,888				12,125				11,615
Total risk based capital			346,429				339,118				332,162				326,168				324,396
Risk weighted assets			2,658,122				2,708,328				2,668,708				2,613,003				2,596,463
Average assets for leverage ratio			3,223,539				3,246,949				3,186,307				3,165,665				3,108,707
Common Equity Tier 1 (CET1) ratio			11.59	%			11.10	%			11.01	%			11.04	%			11.07	%
Tier 1 ratio			12.57	%			12.05	%			11.96	%			12.02	%			12.05	%
Total risk based capital ratio			13.03	%			12.52	%			12.45	%			12.48	%			12.49	%
Tier 1 leverage ratio			10.36	%			10.05	%			10.02	%			9.92	%			10.06	%
Tangible common equity to tangible assets**			9.56	%			9.04	%			8.89	%			8.84	%			9.00	%
LIQUIDITY
Net loans to total deposits			97.90	%			98.12	%			97.55	%			95.48	%			94.89	%
Reliance on wholesale funding			17.71	%			18.61	%			19.01	%			17.39	%			17.65	%
INCOME STATEMENT (THREE MONTH RESULTS; ANNUALIZED)
Return on Average Assets			1.05	%			1.03	%			0.93	%			0.66	%			0.79	%
Return on Average Common Equity			9.21	%			9.33	%			8.46	%			5.89	%			7.04	%
Net interest margin (non-tax equivalent)			3.65	%			3.77	%			3.68	%			3.58	%			3.54	%

 

** Non-GAAP financial  measure

 

Non-GAAP Financial Measures

Tangible assets, tangible common equity, tangible book value, adjusted average tangible common equity, adjusted net income, adjusted noninterest income, adjusted operating revenues, adjusted noninterest expense, adjusted operating expenses, adjusted allowance for loan losses, and related ratios and per share measures, including adjusted return on average assets and adjusted return on average equity, as used throughout this release, are non-GAAP financial measures. Management uses (i) tangible assets, tangible common equity, tangible book value and average tangible common equity (which exclude goodwill and other intangibles from equity and assets), and related ratios, to evaluate the adequacy of shareholders’ equity and to facilitate comparisons with peers; (ii) adjusted allowance for loan losses (which includes net FMV adjustments related to acquired loans) as supplemental information for comparing the combined allowance and fair market value adjustments to the combined acquired and non-acquired loan portfolios (fair market value adjustments are available only for losses on acquired loans) to facilitate comparisons with peers; and (iii) adjusted net income, adjusted noninterest income and adjusted noninterest expense (which exclude merger-related expenses and/or gain or loss on sale of securities, as applicable), adjusted operating expense (which excludes merger-related expenses and amortization of intangibles) and adjusted operating revenues (which includes net interest income and noninterest income and excludes gain or loss on sale of securities, as applicable) to evaluate core earnings and to facilitate comparisons with peers.

 

PARK STERLING CORPORATION
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
($ in thousands, except per share amounts)
		As of or for the three month periods ended
		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016				2016
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Adjusted net income
Net income (as reported)		$	8,694			$	8,527			$	7,489			$	5,331			$	6,324
Plus: merger-related expenses			592				923				-				2,984				1,487
Less: (gain) loss on sale of securities			-				-				(58	)			(6	)			-
Less: tax impact of merger-related expenses and (gain) loss on sale of securities			(84	)			(236	)			20				(1,004	)			(499	)
Adjusted net income		$	9,202			$	9,214			$	7,451			$	7,305			$	7,312
Divided by: weighted average diluted shares			53,527,283				53,481,846				53,462,857				53,155,493				52,743,928
Adjusted net income per share			0.17				0.17				0.14				0.14				0.14
Estimated tax rate for adjustment			14.19	%			25.57	%			34.48	%			33.71	%			33.56	%
Adjusted noninterest income
Noninterest income (as reported)		$	5,379			$	5,418			$	5,468			$	5,845			$	5,447
Less: (gain) loss on sale of securities			-				-				(58	)			(6	)			-
Adjusted noninterest income		$	5,379			$	5,418			$	5,410			$	5,839			$	5,447
Adjusted noninterest expenses
Noninterest expenses (as reported)		$	20,141			$	21,449			$	20,642			$	25,025			$	21,112
Less: merger-related expenses			(592	)			(923	)			-				(2,984	)			(1,487	)
Adjusted noninterest expenses		$	19,549			$	20,526			$	20,642			$	22,041			$	19,625
Adjusted operating expense
Noninterest expenses (as reported)		$	20,141			$	21,449			$	20,642			$	25,025			$	21,112
Less: merger-related expenses			(592	)			(923	)			-				(2,984	)			(1,487	)
Less: amortization of intangibles			(454	)			(454	)			(454	)			(458	)			(458	)
Adjusted operating expense		$	19,095			$	20,072			$	20,188			$	21,583			$	19,167
Adjusted operating revenues
Net Interest Income (as reported)		$	27,834			$	28,610			$	27,058			$	26,571			$	25,823
Plus: noninterest income (as reported)			5,379				5,418				5,468				5,845				5,447
Less: (gain) loss on sale of securities			-				-				(58	)			(6	)			-
Adjusted operating revenues		$	33,213			$	34,028			$	32,468			$	32,410			$	31,270
Adjusted efficiency ratio
Adjusted operating expense		$	19,095			$	20,072			$	20,188			$	21,583			$	19,167
Divided by: adjusted operating revenues			33,213				34,028				32,468				32,410				31,270
Adjusted operating expense to adjusted operating revenues			57.49	%			58.99	%			62.18	%			66.59	%			61.30	%
Noninterest expenses to net interest income plus noninterest income			60.64	%			63.03	%			63.46	%			77.20	%			67.52	%
Adjusted return on average assets
Adjusted net income		$	9,202			$	9,214			$	7,451			$	7,305			$	7,312
Divided by: average assets			3,292,629				3,316,742				3,258,510				3,229,299				3,186,799
Multiplied by: annualization factor			3.97				4.01				4.06				3.98				3.98
Adjusted return on average assets			1.11	%			1.11	%			0.93	%			0.90	%			0.91	%
Return on average assets			1.05	%			1.03	%			0.93	%			0.66	%			0.79	%
Adjusted return on average equity
Adjusted net income		$	9,202			$	9,214			$	7,451			$	7,305			$	7,312
Divided by: average common equity			374,463				366,483				359,130				359,985				357,577
Multiplied by: annualization factor			3.97				4.01				4.06				3.98				3.98
Adjusted return on average equity			9.75	%			10.08	%			8.41	%			8.07	%			8.14	%
Return on average equity			9.21	%			9.33	%			8.46	%			5.89	%			7.04	%

 

 

PARK STERLING CORPORATION
RECONCILIATION OF NON-GAAP MEASURES
($ in thousands, except per share amounts)
		As of or for the three month periods ended
		September 30,				June 30,				March 31,				December 31,				September 30,
		2017				2017				2017				2016				2016
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Tangible common equity to tangible assets
Total assets		$	3,247,253			$	3,340,999			$	3,308,756			$	3,255,396			$	3,226,938
Less: intangible assets			(73,392	)			(73,847	)			(74,301	)			(74,755	)			(74,926	)
Tangible assets		$	3,173,861			$	3,267,152			$	3,234,455			$	3,180,641			$	3,152,012
Total common equity		$	376,689			$	369,264			$	361,720			$	355,845			$	358,696
Less: intangible assets			(73,392	)			(73,847	)			(74,301	)			(74,755	)			(74,926	)
Tangible common equity		$	303,297			$	295,417			$	287,419			$	281,090			$	283,770
Tangible common equity		$	303,297			$	295,417			$	287,419			$	281,090			$	283,770
Divided by: tangible assets			3,173,861				3,267,152				3,234,455				3,180,641				3,152,012
Tangible common equity to tangible assets			9.56	%			9.04	%			8.89	%			8.84	%			9.00	%
Common equity to assets			11.60	%			11.05	%			10.93	%			10.93	%			11.12	%
Tangible book value per share
Issued and outstanding shares			53,364,798				53,279,996				53,112,726				53,116,519				53,305,834
Less: unvested restricted stock awards			(364,560	)			(375,056	)			(390,233	)			(405,732	)			(837,561	)
Period end dilutive shares			53,000,238				52,904,940				52,722,493				52,710,787				52,468,273
Tangible common equity		$	303,297			$	295,417			$	287,419			$	281,090			$	283,770
Divided by: period end dilutive shares			53,000,238				52,904,940				52,722,493				52,710,787				52,468,273
Tangible common book value per share		$	5.72			$	5.58			$	5.45			$	5.33			$	5.41
Common book value per share		$	7.11			$	6.98			$	6.86			$	6.75			$	6.84
Adjusted return on average tangible common equity
Average common equity		$	374,463			$	366,483			$	359,130			$	359,985			$	357,577
Less: average intangible assets			(73,598	)			(74,050	)			(74,504	)			(74,812	)			(75,196	)
Average tangible common equity		$	300,865			$	292,433			$	284,626			$	285,173			$	282,381
Net income		$	8,694			$	8,527			$	7,489			$	5,331			$	6,324
Divided by: average tangible common equity			300,865				292,433				284,626				285,173				282,381
Multiplied by: annualization factor			3.97				4.01				4.06				3.98				3.98
Return on average tangible common equity			11.46	%			11.70	%			10.67	%			7.44	%			8.91	%
Adjusted net income		$	9,202			$	9,214			$	7,451			$	7,305			$	7,312
Divided by: average tangible common equity			300,865				292,433				284,626				285,173				282,381
Multiplied by: annualization factor			3.97				4.01				4.06				3.98				3.98
Adjusted return on average tangible common equity			12.13	%			12.64	%			10.62	%			10.19	%			10.30	%
Adjusted allowance for loan losses
Allowance for loan losses		$	12,423			$	12,702			$	12,833			$	12,125			$	11,612
Plus: acquisition accounting FMV adjustments to acquired loans			22,456				22,185				25,645				27,773				29,325
Adjusted allowance for loan losses		$	34,879			$	34,887			$	38,478			$	39,898			$	40,937
Divided by: total loans (excluding LHFS before FMV adjustments)		$	2,452,041			$	2,524,305			$	2,486,240			$	2,439,959			$	2,398,275
Adjusted allowance for loan losses to total loans			1.42	%			1.38	%			1.55	%			1.64	%			1.71	%
Allowance for loan losses to total loans			0.51	%			0.51	%			0.52	%			0.50	%			0.49	%

 

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