EX-99.1 2 exh_991.htm EXHIBIT 99.1

Exhibit 99.1

 

 

April 28, 2022

 

 

Simmons First National Corporation Reports First Quarter 2022 Diluted EPS of $0.58

 

Key Highlights in the First Quarter of 2022:

 

·Net income of $65.1 million, or $0.58 on a fully diluted per share basis

 

·Core earnings of $67.2 million, or $0.59 on a fully diluted per share basis

 

·Newly funded loans and advances top $2.5 billion in the quarter, outpacing loan paydowns and payoffs

 

·Commercial loan pipeline reaches $2.4 billion, marks 6th consecutive quarter of increased activity; unfunded commitments record second straight double-digit quarterly increase, rising to $3.4 billion

 

·Total deposits increase to $19.4 billion while reflecting continued success in growth of low-cost deposits and effectively managing rates; cost of deposits drops to 14 bps, down 3 bps on a linked quarter basis

 

·Continued improvement in credit quality metrics and economic scenarios drive provision benefit in the quarter; nonperforming loan ratio drops to 53 bps, NPL coverage ratio remains strong at 278 percent

 

·Regulatory capital ratios remain significantly above “well-capitalized” guidelines; CET1 ratio ends the quarter at 13.52 percent, total risked-based capital ratio stands at 16.42 percent

 

·Acquisition of Spirit of Texas Bancshares, Inc. closed shortly after quarter end, less than five months after announcement; systems conversion completed over two-day weekend, and branches opened on April 11 as Simmons Bank

 

 

Pine Bluff, AR – Simmons First National Corporation (NASDAQ: SFNC) (Simmons or Company) today reported net income of $65.1 million for the first quarter of 2022, compared to $67.4 million in the first quarter of 2021. Diluted earnings per share were $0.58 for the first quarter of 2022, compared to $0.62 for the first quarter of 2021. Included in first quarter 2022 results were $2.1 million in net after-tax merger related and net branch right-sizing costs, while first quarter 2021 results included a $3.4 million net after-tax benefit primarily associated with a gain on sale of branches in Illinois. Excluding the impact of these items, core earnings for the first quarter of 2022 were $67.2 million, compared to $64.0 million for the first quarter of 2021. Core diluted earnings per share were $0.59 for both the first quarter of 2022 and the first quarter of 2021.

 

“Simmons posted solid results in the quarter driven by accelerating loan demand across our footprint and continued growth of low-cost deposits,” said George A. Makris, Jr., Simmons’ chairman and CEO. “We also delivered another quarter of exceptional credit performance, with nonperforming assets dropping to historically low levels. Equally important, we were able to achieve these results while simultaneously completing the acquisition and conversion of Spirit of Texas Bancshares, Inc. shortly after the end of the quarter. This acquisition more than doubles our size and scale in the Lone Star State, while complementing our existing presence in the Dallas-Fort Worth market and adding a platform for growth in Houston, Austin, San Antonio, Corpus Christi and College Station, as well as a number of other attractive community markets.”

 

“While we are encouraged by our results to start the year, we also recognize the challenges ahead given expectations that interest rates are most likely to increase further during the remainder of 2022, the impact elevated inflation levels have on the cost of everyday goods and services, and the global unrest that adds uncertainty to the financial markets and potentially future economic growth. In times like this, it certainly helps to have strong capital and liquidity positions, a commitment to maintaining strong underwriting standards and a team that is focused on meeting challenges head-on, while working to ensure we provide our customers exceptional service and access to the products and services they need to successfully manage their financial needs.”

 

 

 

 

Selected Highlights:
$ in millions, except per share data		  Q1 22  Q4 21  Q3 21  Q2 21  Q1 21
Net income  $65.1   $48.2   $80.6   $74.9   $67.4 
Diluted earnings per share  $0.58   $0.42   $0.74   $0.69   $0.62 
Cash dividend per share  $0.19   $0.18   $0.18   $0.18   $0.18 
Return on average assets   1.06%    0.77%    1.37%    1.29%    1.20% 
Return on average common equity   8.33%    5.87%    10.42%    10.08%    9.20% 
Return on tangible common equity (1)   14.31%    9.98%    17.43%    17.25%    15.85% 
                          
Core earnings (2)  $67.2   $59.5   $79.4   $75.4   $64.0 
Core diluted earnings per share (2)  $0.59   $0.52   $0.73   $0.69   $0.59 
Core return on average assets (2)   1.10%    0.96%    1.35%    1.30%    1.14% 
Core return on average common equity (2)   8.59%    7.24%    10.26%    10.15%    8.73% 
Core return on tangible common equity (1)(2)   14.74%    12.19%    17.18%    17.36%    15.08% 
Efficiency ratio (3)   62.95%    59.48%    58.10%    56.75%    57.25% 
Adjusted pre-tax, pre-provision earnings (2)  $62.3   $73.7   $72.6   $74.6   $73.1 

 

(1)Return on tangible common equity excludes goodwill and other intangible assets and is a non-GAAP measurement. See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.
(2)Core and adjusted figures exclude certain items and are non-GAAP measurements. See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.
(3)Efficiency ratio is a non-GAAP measurement. See “Reconciliation of Non-GAAP Financial Measures” below.

 

Loans and Unfunded Loan Commitments

 

 

$ in millions

 Q1 22 Q4 21 Q3 21 Q2 21 Q1 21
Total loans $12,029 $12,013 $10,825 $11,386 $12,196
           
PPP loans $62 $117 $212 $441 $798
Mortgage warehouse loans $166 $230 $275 $307 $355
Energy loans $48 $105 $128 $174 $247
           
Total loans, excluding PPP, mortgage warehouse, and energy loans (core loans) $11,753 $11,561 $10,210 $10,464 $10,796
           
Unfunded loan commitments $3,428 $2,943 $2,254 $2,130 $2,039

 

Total loans at the end of the first quarter of 2022 were $12.0 billion, compared to $12.0 billion at the end of the fourth quarter of 2021 and $12.2 billion at the end of the first quarter of 2021. While total loans were up slightly on a linked quarter basis, continued forgiveness of Paycheck Protection Program (PPP) loans, an industry-wide decline in mortgage warehouse loans due to changing market conditions and continued planned run-off in the energy portfolio offset overall loan growth. Excluding these items, core loans on a linked quarter annualized basis were up 7 percent. Equally important, newly funded loans and advances during the quarter totaled $2.5 billion, significantly outpacing loan paydowns and payoffs in the quarter.

 

Further evidence suggesting a return to more normalized levels of loan demand continued to materialize during the quarter. Unfunded commitments – which the Company considers a strong indicator of potential future loan growth – rose for the fourth consecutive quarter to $3.4 billion at quarter end, up 16 percent on a linked quarter basis and following a 31 percent linked quarter increase in the fourth quarter of 2021. At the same time, momentum in our commercial loan pipeline continued to strengthen with all loan opportunities totaling $2.4 billion at the end of the quarter, up from $2.3 billion at the end of the fourth quarter of 2021. This marked the sixth consecutive quarter of increased activity in our commercial loan pipeline. As expected, loan growth was more heavily weighted toward the latter portion of the quarter, with commercial loans approved and ready to close at the end of the quarter totaling $775.7 million, up 25 percent compared to the balance at the end of the fourth quarter of 2021.

 

 

 

 

 

Deposits

 

 

$ in billions

 Q1 22 Q4 21 Q3 21 Q2 21 Q1 21
Total deposits $19.4 $19.4 $18.1 $18.3 $18.2
Noninterest bearing deposits $5.2 $5.3 $4.9 $4.9 $4.9
Interest bearing deposits $12.1 $11.6 $10.7 $10.6 $10.3
Time deposits $2.1 $2.5 $2.5 $2.8 $3.0

 

Total deposits at the end of the first quarter of 2022 were $19.4 billion, unchanged from fourth quarter 2021 levels and up $1.2 billion, or 7 percent, from $18.2 billion at the end of the first quarter of 2021. The increase in deposits from the year-ago quarter primarily reflects the acquisitions of Landmark Community Bank and Triumph Bancshares, Inc., which were completed in the fourth quarter of 2021. Total noninterest bearing deposit accounts totaled $5.2 billion at the end of the first quarter of 2022, compared to $5.3 billion at the end of the fourth quarter of 2021 and $4.9 billion at the end of the first quarter of 2021. Interest bearing deposits (checking, savings and money market accounts) totaled $12.1 billion at the end of the first quarter of 2022, up $517 million, or 4 percent, compared to $11.6 billion at the end of the fourth quarter of 2021, and up $1.8 billion, or 18 percent, compared to $10.3 billion at the end of the first quarter of 2021. At the same time, time deposits totaled $2.1 billion at the end of the first quarter of 2022, down $390 million, or 16 percent, compared to $2.5 billion at the end of the fourth quarter of 2021, and down $962 million, or 32 percent, from the first quarter of 2021. The decrease in time deposits is attributable to maturing time deposits, coupled with a continued effort to improve our mix of deposits into lower cost deposits.

 

Net Interest Income

 

  Q1 22 Q4 21 Q3 21 Q2 21 Q1 21
Loan yield (1) 4.34% 4.58% 4.76% 4.73% 4.75%
Security yield (1) 1.86% 1.74% 1.77% 1.97% 2.36%
Cost of interest bearing deposits 0.19% 0.23% 0.27% 0.32% 0.41%
Cost of deposits (2) 0.14% 0.17% 0.20% 0.24% 0.30%
Cost of borrowed funds 1.94% 1.95% 1.96% 1.97% 1.91%
Net interest spread (1) 2.66% 2.74% 2.72% 2.74% 2.83%
Net interest margin (1) 2.76% 2.86% 2.85% 2.89% 2.99%

 

(1)Fully tax equivalent using an effective tax rate of 26.135%.
(2)Includes noninterest bearing deposits.

 

Net interest income for the first quarter of 2022 totaled $145.6 million, compared to $153.1 million in the fourth quarter of 2021 and $146.7 million for the first quarter of 2021. Included in net interest income is interest income from PPP loans totaling $2.1 million in the first quarter of 2022, $5.1 million in the fourth quarter of 2021 and $11.7 million in the first quarter of 2021. Also included in net interest income is accretion recognized on loans acquired, which totaled $3.7 million in the first quarter of 2022, $5.8 million in the fourth quarter of 2021 and $6.6 million in the first quarter of 2021. The decrease in net interest income on a linked quarter and year-over-year basis reflects the lower contributions from accretion and PPP loans, a decrease in new loan yields compared to maturing or paid off loans and lower average loan balances, offset in part by our ability to continue to successfully reduce deposit costs.

 

The yield on loans for the first quarter of 2022 was 4.34 percent, compared to 4.58 percent in the fourth quarter of 2021 and 4.75 percent in the first quarter of 2021. Cost of deposits for the first quarter of 2022 was 14 basis points, down 3 basis points on a linked quarter basis and down 16 basis points compared to the first quarter of 2021. Net interest margin on a fully taxable equivalent basis was 2.76 percent, compared to 2.86 percent in the fourth quarter of 2021 and 2.99 percent in the first quarter of 2021. Excluding the impact of PPP loan interest income, the net interest margin was 2.74 percent for the first quarter of 2022, 2.79 percent for the fourth quarter of 2021 and 2.88 percent for the first quarter of 2021.

 

 

 

 

 

Noninterest Income

 

Noninterest income for the first quarter of 2022 was $42.2 million, compared to $46.6 million in the fourth quarter of 2021 and $49.5 million in the first quarter of 2021. Included in noninterest income is a settlement award of $1.4 million recorded in the first quarter of 2022, a settlement award of $3.1 million recorded in the fourth quarter of 2021 and a $5.3 million gain recorded in the first quarter of 2021 associated with the sale of branches in Illinois. Gains (losses) on sales of investment securities totaled $(54) thousand in the first quarter of 2022, $(348) thousand in the fourth quarter of 2021 and $5.5 million in the first quarter of 2021. The decrease in noninterest income compared to the year ago quarter was primarily attributable to the aforementioned items, coupled with a decrease in mortgage lending due to market conditions, offset in part by increases in service charges on deposit accounts (+10 percent), wealth management fees (+8 percent) and debit and credit card fees (+13 percent). The decrease in noninterest income on a linked quarter basis is partially due to the items noted above along with two fewer business days in the first quarter of 2022.

 

Select Noninterest Income Items

$ in millions

 Q1 22 Q4 21 Q3 21 Q2 21 Q1 21
Service charges on deposit accounts $10.7 $11.9 $11.6 $10.1 $9.7
Wealth management fees $8.0 $8.0 $7.9 $7.9 $7.4
Debit and credit card fees (1) $7.4 $7.5 $7.1 $7.1 $6.6
Mortgage lending income $4.6 $5.0 $5.8 $4.5 $6.4
Bank owned life insurance $2.7 $2.8 $2.6 $2.0 $1.5
Gain on sale of securities $(0.1) $(0.4) $5.2 $5.1 $5.5
Other income $7.3 $10.0 $6.4 $8.4 $10.5
           
Core other income (2) $7.3 $10.0 $6.7 $8.0 $5.0

 

(1)During the second quarter of 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest income. Prior periods have been adjusted to reflect this reclassification.
(2)Core figures exclude certain items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

 

Noninterest Expense

 

Noninterest expense for the first quarter of 2022 was $128.4 million, compared to $141.6 million in the fourth quarter of 2021 and $113.0 million in the first quarter of 2021. Included in noninterest expense are certain items totaling $2.8 million in the first quarter of 2022, primarily associated with merger related costs and branch right-sizing costs. Excluding these items, core noninterest expense for the first quarter of 2022 was $125.6 million, compared to $126.4 million in the fourth quarter of 2021 and $112.1 million in the first quarter of 2021. The increase in noninterest expense on a year-over-year basis reflects the acquisitions of Landmark Community Bank and Triumph Bancshares, Inc., which were completed in the fourth quarter of 2021. The change in noninterest expense on a linked quarter basis reflects a decline in merger related costs, offset in part by normal seasonality with respect to payroll taxes at the beginning of the year, as well as a profit-sharing contribution associated with the Company’s 401(k) plan and costs associated with equity compensation. Noninterest expense as a percentage of average assets was 2.07 percent for the first quarter of 2022 and core noninterest expense as a percentage of average assets was 2.02 percent for the period.

 

Select Noninterest Expense Items

$ in millions

 Q1 22 Q4 21 Q3 21 Q2 21 Q1 21
Salaries and employee benefits $67.9 $63.9 $61.9 $60.3 $60.3
Occupancy expense, net $10.0 $11.0 $9.4 $9.1 $9.3
Furniture and equipment $4.8 $4.7 $4.9 $4.9 $5.4
Merger related costs $1.9 $13.6 $1.4 $0.7 $0.2
Other operating expenses (1) $41.6 $45.7 $34.6 $37.2 $36.1
           
Core salaries and employee benefits (2) $67.9 $63.8 $61.8 $60.3 $60.3
Core other operating expenses (2) $40.9 $45.8 $38.3 $37.1 $35.9

 

(1)During the second quarter of 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest income. Prior periods have been adjusted to reflect this reclassification.
(2)Core figures exclude certain items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

 

 

 

 

 

Asset Quality

 

$ in millions

 Q1 22 Q4 21 Q3 21 Q2 21 Q1 21
Allowance for credit losses on loans to total loans 1.49% 1.71% 1.87% 2.00% 1.93%
Allowance for credit losses on loans to nonperforming loans 278% 300% 341% 281% 204%
Nonperforming loans to total loans 0.53% 0.57% 0.55% 0.71% 0.95%
Net charge-off ratio (annualized) 0.22% 0.31% 0.17% (0.07%) 0.10%
Net charge-off ratio YTD (annualized) 0.22% 0.13% 0.06% 0.01% 0.10%
           
Total nonperforming loans $64.3 $68.6 $59.4 $80.9 $115.5
Total other nonperforming assets $6.6 $7.7 $13.5 $16.3 $12.4

 

Continued improvements in the economic outlook and positive credit performance during the quarter resulted in a net $19.9 million benefit from credit losses for the first quarter of 2022. Total nonperforming loans at the end of the first quarter of 2022 dropped to $64.3 million, down $4.2 million compared to $68.6 million at the end of the fourth quarter of 2021 and down $51.2 million compared to $115.5 million at the end of the first quarter of 2021. Total nonperforming assets as a percentage of total assets were 0.29 percent at the end of the first quarter of 2022, compared to 0.31 percent at the end of the fourth quarter of 2021 and 0.55 percent at the end of the first quarter of 2021.

 

Net charge-offs as a percentage of average loans were 22 basis points for the quarter, compared to 31 basis points in the fourth quarter of 2021 and 10 basis points for the first quarter of 2021. Net charge-offs in the quarter included a single, isolated healthcare related credit that had been fully provisioned totaling $6.1 million. The charge-off of this credit accounted for 21 of the 22 basis points to the net charge-off ratio during the first quarter of 2022. The allowance for credit losses on loans at the end of the first quarter of 2022 was $178.9 million, compared to $205.3 million at the end of the fourth quarter of 2021 and $235.1 million at the end of the first quarter of 2021. The allowance to loan ratio ended the quarter at 1.49 percent, compared to 1.71 percent at the end of 2021 and 1.93 percent and the end of the first quarter of 2021. The nonperforming loan coverage ratio ended the quarter at 278 percent, compared to 300 percent at the end of 2021 and 204 percent at the end of the first quarter of 2021.

 

Capital

 

  Q1 22 Q4 21 Q3 21 Q2 21 Q1 21
Stockholders’ equity to total assets 12.1% 13.1% 13.1% 13.0% 12.6%
Tangible common equity to tangible assets (1) 7.4% 8.5% 8.4% 8.4% 7.9%
Regulatory common equity tier 1 ratio 13.5% 13.8% 14.3% 14.2% 14.1%
Regulatory tier 1 leverage ratio 9.0% 9.1% 9.1% 9.0% 9.0%
Regulatory tier 1 risk-based capital ratio 13.5% 13.8% 14.3% 14.2% 14.1%
Regulatory total risk-based capital ratio 16.4% 16.8% 17.4% 17.5% 17.5%

 

(1)Tangible common equity to tangible assets is a non-GAAP measurement. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.

 

Total common stockholders’ equity at the end of the first quarter of 2022 was $3.0 billion, compared to $3.2 billion at the end of the fourth quarter of 2021 and $2.9 billion at the end of the first quarter of 2021. The decrease in common stockholders’ equity compared to the previous quarter was primarily due to an increase in unrealized losses associated with investment securities classified as available-for-sale resulting from a significant increase in interest rates during the first quarter of 2022. Book value per share at the end of the first quarter of 2022 was $26.32, compared to $28.82 at the end of the fourth quarter of 2021 and $27.04 and the end of the first quarter of 2021. Tangible book value per share was $15.22 at the end of the first quarter of 2022, compared to $17.71 at the end of the fourth quarter of 2021 and $16.13 at the end of the first quarter of 2021. The ratio of stockholders’ equity to total assets at March 31, 2022, was 12.1 percent and the ratio of tangible common equity to tangible assets was 7.4 percent. All of Simmons’ regulatory capital ratios continue to significantly exceed “well-capitalized” guidelines.

 

 

 

 

Share Repurchase Program and Cash Dividend

 

As previously announced, as a result of the Simmons’ strong capital position and ability to organically generate capital, the board of directors declared a quarterly cash dividend on Simmons’ Class A common stock of $0.19 per share, which was paid on April 4, 2022, to shareholders of record as of March 15, 2022. The cash dividend rate represents an increase of $0.01 per share, or 6 percent, from the dividend paid for the same time period last year. This marked the 113th consecutive year that Simmons has paid a cash dividend to its shareholders.

 

During the first quarter of 2022, Simmons repurchased approximately 514,000 shares of its Class A common stock at an average price of $31.25 pursuant to Simmons’ stock repurchase program that was originally approved in October 2019 and subsequently amended in March 2020 and July 2021 (2019 Program), substantially exhausting the remaining capacity under the 2019 Program. In January 2022, Simmons announced that its board of directors authorized a new stock repurchase program (2022 Program), which replaced the 2019 Program and authorized Simmons to repurchase up to $175,000,000 of its Class A common stock currently issued and outstanding. No shares were repurchased under the 2022 Program during the first quarter of 2022. Market conditions and our capital needs will drive the decisions regarding additional, future stock repurchases.

 

The 2022 Program permits Simmons to repurchase shares of its Class A common stock through open market and privately negotiated transactions or otherwise. The timing, pricing, and amount of any repurchases under the 2022 Program will be determined by Simmons’ management at its discretion based on a variety of factors, including, but not limited to, trading volume and market price of the common stock, corporate considerations, Simmons’ working capital and investment requirements, general market and economic conditions, and legal requirements. The 2022 Program does not obligate Simmons to repurchase any common stock and may be modified, discontinued, or suspended at any time without prior notice.

 

Simmons First National Corporation

 

Simmons First National Corporation (NASDAQ: SFNC) is a Mid-South based financial holding company that has paid cash dividends to its shareholders for 113 consecutive years. Its principal subsidiary, Simmons Bank, operates more than 200 branches in Arkansas, Kansas, Missouri, Oklahoma, Tennessee and Texas. Founded in 1903, Simmons Bank offers comprehensive financial solutions delivered with a client-centric approach. Simmons Bank was named to Forbes list of “America’s Best Banks” in 2022 and was recently named to Forbes list of “World’s Best Banks” for the third consecutive year. Additional information about Simmons Bank can be found on our website at simmonsbank.com, by following @Simmons_Bank on Twitter or by visiting our newsroom.

 

Conference Call

 

Management will conduct a live conference call to review this information beginning at 9:00 a.m. Central Time today, Thursday, April 28, 2022. Interested persons can listen to this call by dialing toll-free 1-866-298-7926 (United States and Canada only) and asking for the Simmons First National Corporation conference call, conference ID 3439828. In addition, the call will be available live or in recorded version on the Company’s website at simmonsbank.com for at least 60 days.

 

Non-GAAP Financial Measures

 

This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (GAAP). The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance. These measures adjust GAAP performance measures to, among other things, include the tax benefit associated with revenue items that are tax-exempt, as well as exclude from net income (including on a per share diluted basis), pre-tax, pre-provision earnings, net charge-offs, income available to common shareholders, non-interest income, and non-interest expense certain income and expenses related to significant non-core activities, including merger-related expenses, gain on sale of branches, early retirement program expenses and net branch right-sizing expenses. In addition, the Company also presents certain figures based on tangible common stockholders’ equity, tangible assets and tangible book value, which exclude goodwill and other intangible assets. The Company further presents certain figures that are exclusive of the impact of PPP loans, mortgage warehouse loans, and/or energy loans. The Company’s management believes that these non-GAAP financial measures are useful to investors because they, among other things, present the results of the Company’s ongoing operations without the effect of mergers or other items not central to the Company’s ongoing business, as well as normalize for tax effects and the effects of the PPP. Management, therefore, believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core businesses, and management uses these non-GAAP financial measures to assess the performance of the Company’s core businesses as related to prior financial periods. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.

 

 

 

 

 

Forward-Looking Statements

 

Certain statements in this news release may not be based on historical facts and should be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including, without limitation, statements made in Mr. Makris’s quotes, may be identified by reference to future periods or by the use of forward-looking terminology, such as “believe,” “budget,” “expect,” “foresee,” “anticipate,” “intend,” “indicate,” “target,” “estimate,” “plan,” “project,” “continue,” “contemplate,” “positions,” “prospects,” “predict,” or “potential,” by future conditional verbs such as “will,” “would,” “should,” “could,” “might” or “may,” or by variations of such words or by similar expressions. These forward-looking statements include, without limitation, statements relating to Simmons’ future growth, lending capacity and lending activity, loan demand, revenue, assets, asset quality, profitability, net interest margin, non-interest revenue, share repurchase program, acquisition strategy, digital banking initiatives, the Company’s ability to recruit and retain key employees, the adequacy of the allowance for credit losses, the ability of the Company to manage the impacts of the COVID-19 pandemic, and the impacts of the Company’s and its customers’ participation in the PPP. Any forward-looking statement speaks only as of the date of this news release, and Simmons undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release. By nature, forward-looking statements are based on various assumptions and involve inherent risk and uncertainties. Various factors, including, but not limited to, changes in economic conditions, credit quality, interest rates, loan demand, deposit flows, real estate values, the assumptions used in making the forward-looking statements, the securities markets generally or the price of Simmons’ common stock specifically, and information technology affecting the financial industry; the effect of steps the Company takes and has taken in response to the COVID-19 pandemic; the severity and duration of the COVID-19 pandemic, including the effectiveness of “booster” vaccination efforts and developments with respect to COVID-19 variants; the pace of recovery when the COVID-19 pandemic subsides and the heightened impact it has on many of the risks described herein; the effects of the COVID-19 pandemic on, among other things, the Company’s operations, liquidity, and credit quality; general economic and market conditions; market disruptions including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, war and other military conflicts (including the ongoing military conflict between Russia and Ukraine) or other major events, or the prospect of these events; increased competition in the markets in which the Company operates; increased unemployment; labor shortages; claims, damages, and fines related to litigation or government actions; changes in accounting principles relating to loan loss recognition (current expected credit losses); the Company’s ability to manage and successfully integrate its mergers and acquisitions and to fully realize cost savings and other benefits associated with those transactions; cyber threats, attacks or events; reliance on third parties for key services; government legislation; and other factors, many of which are beyond the control of the Company, could cause actual results to differ materially from those projected in or contemplated by the forward-looking statements. Additional information on factors that might affect the Company’s financial results is included in the Company’s Form 10-K for the year ended December 31, 2021, and other reports that the Company has filed with or furnished to the U.S. Securities and Exchange Commission (the SEC), all of which are available from the SEC on its website, www.sec.gov.

 

 

FOR MORE INFORMATION CONTACT:

Ed Bilek

EVP, Director of Investor and Media Relations

Simmons First National Corporation

ed.bilek@simmonsbank.com

205.612.3378 (cell)

 

 

 

 

 

Simmons First National Corporation    SFNC
Consolidated End of Period Balance Sheets       
For the Quarters Ended    Mar 31      Dec 31      Sep 30      Jun 30      Mar 31  
(Unaudited)   2022    2021    2021    2021    2021 
($ in thousands)                         
ASSETS                         
Cash and non-interest bearing balances due from banks  $195,510   $209,190   $225,500   $215,381   $227,713 
Interest bearing balances due from banks and federal funds sold   1,491,507    1,441,463    1,555,913    2,123,743    3,677,750 
Cash and cash equivalents   1,687,017    1,650,653    1,781,413    2,339,124    3,905,463 
Interest bearing balances due from banks - time   1,857    1,882    1,780    1,335    1,334 
Investment securities - held-to-maturity   1,556,825    1,529,221    1,516,797    931,352    609,500 
Investment securities - available-for-sale   6,640,069    7,113,545    6,822,203    6,556,581    4,528,348 
Mortgage loans held for sale   18,206    36,356    34,628    36,011    63,655 
Other assets held for sale   -    100    100    100    100 
Loans:                         
Loans   12,028,593    12,012,503    10,825,227    11,386,352    12,195,873 
Allowance for credit losses on loans   (178,924)   (205,332)   (202,508)   (227,239)   (235,116)
Net loans   11,849,669    11,807,171    10,622,719    11,159,113    11,960,757 
Premises and equipment   486,531    483,469    463,924    429,587    427,540 
Premises held for sale   -    -    -    6,090    13,613 
Foreclosed assets and other real estate owned   5,118    6,032    11,759    15,239    11,168 
Interest receivable   69,357    72,990    68,405    67,916    71,359 
Bank owned life insurance   448,011    445,305    421,762    419,198    257,152 
Goodwill   1,147,007    1,146,007    1,075,305    1,075,305    1,075,305 
Other intangible assets   102,748    106,235    100,428    103,759    107,091 
Other assets   469,853    325,793    304,707    282,449    315,732 
Total assets  $24,482,268   $24,724,759   $23,225,930   $23,423,159   $23,348,117 
                          
LIABILITIES AND STOCKHOLDERS' EQUITY                         
Deposits:                         
Non-interest bearing transaction accounts  $5,223,862   $5,325,318   $4,918,845   $4,893,959   $4,884,667 
Interest bearing transaction accounts and savings deposits   12,105,948    11,588,770    10,697,451    10,569,602    10,279,997 
Time deposits   2,062,612    2,452,460    2,455,774    2,841,052    3,024,724 
Total deposits   19,392,422    19,366,548    18,072,070    18,304,613    18,189,388 
Federal funds purchased and securities sold under agreements to repurchase   196,828    185,403    217,276    187,215    323,053 
Other borrowings   1,337,243    1,337,973    1,338,585    1,339,193    1,340,467 
Subordinated notes and debentures   384,242    384,131    383,278    383,143    383,008 
Other liabilities held for sale   -    -    -    -    - 
Accrued interest and other liabilities   209,926    201,863    184,190    169,629    181,426 
Total liabilities   21,520,661    21,475,918    20,195,399    20,383,793    20,417,342 
                          
Stockholders' equity:                         
Preferred stock   -    -    767    767    767 
Common stock   1,125    1,127    1,066    1,084    1,083 
Surplus   2,150,453    2,164,989    1,974,561    2,021,128    2,017,188 
Undivided profits   1,136,990    1,093,270    1,065,566    1,004,314    948,913 
Accumulated other comprehensive (loss) income:                         
Unrealized (depreciation) appreciation on AFS securities   (326,961)   (10,545)   (11,429)   12,073    (37,176)
Total stockholders' equity   2,961,607    3,248,841    3,030,531    3,039,366    2,930,775 
Total liabilities and stockholders' equity  $24,482,268   $24,724,759   $23,225,930   $23,423,159   $23,348,117 

 

 

 Page 1 

 

 

Simmons First National Corporation     SFNC
Consolidated Statements of Income - Quarter-to-Date       
For the Quarters Ended   Mar 31    Dec 31    Sep 30    Jun 30    Mar 31 
(Unaudited)   2022    2021    2021    2021    2021 
($ in thousands, except per share data)                         
INTEREST INCOME                         
Loans (including fees)  $127,176   $137,564   $132,216   $138,804   $146,424 
Interest bearing balances due from banks and federal funds sold   649    583    763    651    798 
Investment securities   33,712    32,275    30,717    27,128    21,573 
Mortgage loans held for sale   190    310    230    386    639 
TOTAL INTEREST INCOME   161,727    170,732    163,926    166,969    169,434 
INTEREST EXPENSE                         
Time deposits   2,503    3,705    4,747    6,061    7,091 
Other deposits   4,314    4,390    4,369    4,721    6,088 
Federal funds purchased and securities sold under agreements to repurchase   68    72    70    192    245 
Other borrowings   4,779    4,903    4,893    4,897    4,802 
Subordinated notes and debentures   4,457    4,581    4,610    4,565    4,527 
TOTAL INTEREST EXPENSE   16,121    17,651    18,689    20,436    22,753 
NET INTEREST INCOME   145,606    153,081    145,237    146,533    146,681 
Provision for credit losses   (19,914)   (1,308)   (19,890)   (12,951)   1,445 
                         
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES   165,520    154,389    165,127    159,484    145,236 
NON-INTEREST INCOME                         
Wealth management fees   7,968    8,042    7,877    7,892    7,361 
Service charges on deposit accounts   10,696    11,909    11,557    10,050    9,715 
Other service charges and fees   1,637    1,762    1,964    2,048    1,922 
Mortgage lending income   4,550    5,043    5,818    4,490    6,447 
Debit and credit card fees   7,449    7,460    7,102    7,073    6,610 
Bank owned life insurance income   2,706    2,768    2,573    2,038    1,523 
(Loss) gain on sale of securities, net   (54)   (348)   5,248    5,127    5,471 
Other income   7,266    9,965    6,411    8,397    10,500 
TOTAL NON-INTEREST INCOME   42,218    46,601    48,550    47,115    49,549 
NON-INTEREST EXPENSE                         
Salaries and employee benefits   67,906    63,832    61,902    60,261    60,340 
Occupancy expense, net   10,023    11,033    9,361    9,103    9,300 
Furniture and equipment expense   4,775    4,721    4,895    4,859    5,415 
Other real estate and foreclosure expense   343    576    339    863    343 
Deposit insurance   1,838    2,108    1,870    1,687    1,308 
Merger-related costs   1,886    13,591    1,401    686    233 
Other operating expenses   41,646    45,736    34,565    37,198    36,063 
TOTAL NON-INTEREST EXPENSE   128,417    141,597    114,333    114,657    113,002 
NET INCOME BEFORE INCOME TAXES   79,321    59,393    99,344    91,942    81,783 
Provision for income taxes   14,226    11,155    18,770    17,018    14,363 
NET INCOME   65,095    48,238    80,574    74,924    67,420 
Preferred stock dividends   -    8    13    13    13 
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS  $65,095   $48,230   $80,561   $74,911   $67,407 
BASIC EARNINGS PER SHARE  $0.58   $0.42   $0.75   $0.69   $0.62 
DILUTED EARNINGS PER SHARE  $0.58   $0.42   $0.74   $0.69   $0.62 

 

 

 Page 2 

 

 

Simmons First National Corporation    SFNC
Consolidated Risk-Based Capital       
For the Quarters Ended    Mar 31      Dec 31      Sep 30      Jun 30      Mar 31  
(Unaudited)   2022    2021    2021    2021    2021 
($ in thousands)                         
Tier 1 capital                         
Stockholders' equity  $2,961,607   $3,248,841   $3,030,531   $3,039,366   $2,930,775 
CECL transition provision (1)   92,619    114,458    122,787    128,933    131,637 
Disallowed intangible assets, net of deferred tax   (1,224,691)   (1,226,686)   (1,152,688)   (1,156,203)   (1,159,720)
Unrealized loss (gain) on AFS securities   326,961    10,545    11,429    (12,073)   37,176 
Total Tier 1 capital   2,156,496    2,147,158    2,012,059    2,000,023    1,939,868 
                          
Tier 2 capital                         
Subordinated notes and debentures   384,242    384,131    383,278    383,143    383,008 
Qualifying allowance for loan losses and reserve for unfunded commitments   78,057    71,853    60,700    79,138    87,251 
Total Tier 2 capital   462,299    455,984    443,978    462,281    470,259 
Total risk-based capital  $2,618,795   $2,603,142   $2,456,037   $2,462,304   $2,410,127 
                          
Risk weighted assets  $15,953,622   $15,538,967   $14,098,320   $14,076,975   $13,771,244 
                          
Adjusted average assets for leverage ratio  $23,966,206   $23,647,901   $22,189,921   $22,244,118   $21,668,406 
                          
Ratios at end of quarter                         
Equity to assets   12.10%   13.14%   13.05%   12.98%   12.55%
Tangible common equity to tangible assets (2)   7.37%   8.51%   8.41%   8.36%   7.88%
Common equity Tier 1 ratio (CET1)   13.52%   13.82%   14.27%   14.20%   14.08%
Tier 1 leverage ratio   9.00%   9.08%   9.07%   8.99%   8.95%
Tier 1 risk-based capital ratio   13.52%   13.82%   14.27%   14.21%   14.09%
Total risk-based capital ratio   16.42%   16.75%   17.42%   17.49%   17.50%
 

(1) The Company has elected to use the CECL transition provision allowed for in the year of adopting ASC 326.

(2) Calculations of tangible common equity to tangible assets and the reconciliations to GAAP are included in the schedules accompanying this release. 

 

 Page 3 

 

Simmons First National Corporation    SFNC
Consolidated Investment Securities     
For the Quarters Ended    Mar 31      Dec 31      Sep 30      Jun 30      Mar 31  
(Unaudited)   2022    2021    2021    2021    2021 
($ in thousands)                         
Investment Securities - End of Period                         
Held-to-Maturity                         
U.S. Government agencies  $232,670   $232,609   $232,549   $77,396   $77,396 
Mortgage-backed securities   112,496    70,342    57,930    60,649    47,988 
State and political subdivisions   1,194,459    1,209,051    1,209,091    793,307    484,116 
Other securities   17,200    17,219    17,227    -    - 
Total held-to-maturity (net of credit losses)   1,556,825    1,529,221    1,516,797    931,352    609,500 
Available-for-Sale                         
U.S. Treasury  $-   $300   $300   $600   $600 
U.S. Government agencies   333,231    364,641    354,382    554,937    487,679 
Mortgage-backed securities   4,166,108    4,448,616    4,421,620    3,987,209    2,133,086 
State and political subdivisions   1,653,694    1,819,658    1,575,208    1,557,497    1,571,910 
Other securities   487,036    480,330    470,693    456,338    335,073 
Total available-for-sale (net of credit losses)   6,640,069    7,113,545    6,822,203    6,556,581    4,528,348 
Total investment securities (net of credit losses)  $8,196,894   $8,642,766   $8,339,000   $7,487,933   $5,137,848 
Fair value - HTM investment securities  $1,307,058   $1,517,378   $1,487,916   $935,596   $597,694 
                          
Investment Securities - QTD Average                         
Taxable securities  $5,688,306   $5,790,429   $5,475,932   $4,265,545   $2,471,291 
Tax exempt securities   2,844,777    2,787,301    2,496,958    2,157,076    1,919,919 
Total investment securities - QTD average  $8,533,083   $8,577,730   $7,972,890   $6,422,621   $4,391,210 

 

 Page 4 

 

 

Simmons First National Corporation SFNC
Consolidated Loans     
For the Quarters Ended    Mar 31      Dec 31      Sep 30      Jun 30      Mar 31  
(Unaudited)   2022    2021    2021    2021    2021 
($ in thousands)                         
Loan Portfolio - End of Period                         
Consumer                         
Credit cards  $184,372   $187,052   $175,884   $177,634   $175,458 
Other consumer   180,602    168,318    182,492    181,712    172,965 
Total consumer   364,974    355,370    358,376    359,346    348,423 
Real Estate                         
Construction   1,423,445    1,326,371    1,229,740    1,428,165    1,451,841 
Single-family residential   2,042,978    2,101,975    1,540,701    1,608,028    1,730,056 
Other commercial real estate   5,762,567    5,738,904    5,308,902    5,332,655    5,638,010 
Total real estate   9,228,990    9,167,250    8,079,343    8,368,848    8,819,907 
Commercial                         
Commercial   2,016,405    1,992,043    1,821,905    2,074,729    2,444,700 
Agricultural   150,465    168,717    216,735    193,462    155,921 
Total commercial   2,166,870    2,160,760    2,038,640    2,268,191    2,600,621 
Other   267,759    329,123    348,868    389,967    426,922 
Total loans  $12,028,593   $12,012,503   $10,825,227   $11,386,352   $12,195,873 

 

 Page 5 

 

 

Simmons First National Corporation SFNC
Consolidated Allowance and Asset Quality    
For the Quarters Ended    Mar 31      Dec 31      Sep 30      Jun 30      Mar 31  
(Unaudited)   2022    2021    2021    2021    2021 
($ in thousands)                         
Allowance for Credit Losses on Loans                         
Beginning balance  $205,332   $202,508   $227,239   $235,116   $238,050 
                          
Day 1 PCD allowance from acquisitions                         
Landmark (10/08/2021)        2,359                
Triumph (10/08/2021)        11,092                
Total Day 1 PCD allowance        13,451                
                          
Loans charged off                         
Credit cards   920    865    711    1,046    1,003 
Other consumer   414    477    463    411    702 
Real estate   485    2,624    5,941    439    1,687 
Commercial   6,319    8,513    932    309    859 
Total loans charged off   8,138    12,479    8,047    2,205    4,251 
                          
Recoveries of loans previously charged off                         
Credit cards   274    247    267    244    290 
Other consumer   387    267    408    425    304 
Real estate   426    916    2,068    1,523    403 
Commercial   557    1,730    463    2,147    320 
Total recoveries   1,644    3,160    3,206    4,339    1,317 
Net loans charged off   6,494    9,319    4,841    (2,134)   2,934 
Provision for credit losses on loans   (19,914)   (1,308)   (19,890)   (10,011)   - 
Balance, end of quarter  $178,924   $205,332   $202,508   $227,239   $235,116 
                          
Non-performing assets                         
Non-performing loans                         
Nonaccrual loans  $64,096   $68,204   $59,054   $80,282   $114,856 
Loans past due 90 days or more   240    349    334    653    635 
Total non-performing loans   64,336    68,553    59,388    80,935    115,491 
Other non-performing assets                         
Foreclosed assets and other real estate owned   5,118    6,032    11,759    15,239    11,168 
Other non-performing assets   1,479    1,667    1,724    1,062    1,229 
Total other non-performing assets   6,597    7,699    13,483    16,301    12,397 
Total non-performing assets  $70,933   $76,252   $72,871   $97,236   $127,888 
Performing TDRs (troubled debt restructurings)  $3,424   $4,289   $4,251   $4,436   $3,805 
                          
Ratios                         
Allowance for credit losses on loans to total loans   1.49%   1.71%   1.87%   2.00%   1.93%
Allowance for credit losses to non-performing loans   278%   300%   341%   281%   204%
Non-performing loans to total loans   0.53%   0.57%   0.55%   0.71%   0.95%
Non-performing assets (including performing TDRs) to total assets   0.30%   0.33%   0.33%   0.43%   0.56%
Non-performing assets to total assets   0.29%   0.31%   0.31%   0.42%   0.55%
Annualized net charge offs to total loans   0.22%   0.31%   0.17%   -0.07%   0.10%
Annualized net credit card charge offs to total credit card loans   1.39%   1.29%   0.96%   1.78%   1.58%

 

 Page 6 

 

 

Simmons First National Corporation  SFNC
Consolidated - Average Balance Sheet and Net Interest Income Analysis   
For the Quarters Ended   
(Unaudited)   
   Three Months Ended
Mar 2022		  Three Months Ended
Dec 2021		  Three Months Ended
Mar 2021
($ in thousands)  Average
Balance		  Income/
Expense		  Yield/
Rate		  Average
Balance		  Income/
Expense		  Yield/
Rate		  Average
Balance		  Income/
Expense		  Yield/
Rate
ASSETS                           
Earning assets:                                             
Interest bearing balances due from banks and federal funds sold  $1,728,694   $649    0.15%  $1,484,752   $583    0.16%  $3,477,989   $798    0.09%
Investment securities - taxable   5,688,306    18,148    1.29%   5,790,429    17,186    1.18%   2,334,078    10,120    1.76%
Investment securities - non-taxable (FTE)   2,844,777    20,937    2.98%   2,787,301    20,470    2.91%   2,057,132    15,439    3.04%
Mortgage loans held for sale   27,633    190    2.79%   42,866    310    2.87%   97,409    639    2.66%
Loans - including fees (FTE)   11,895,805    127,405    4.34%   11,924,444    137,762    4.58%   12,518,300    146,601    4.75%
Total interest earning assets (FTE)   22,185,215    167,329    3.06%   22,029,792    176,311    3.18%   20,484,908    173,597    3.44%
Non-earning assets   2,640,984              2,668,230              2,253,913           
Total assets  $24,826,199             $24,698,022             $22,738,821           
                                              
LIABILITIES AND STOCKHOLDERS' EQUITY                                     
Interest bearing liabilities:                                             
Interest bearing transaction and savings accounts  $12,083,516   $4,314    0.14%  $11,413,325   $4,390    0.15%  $10,093,868   $6,088    0.24%
Time deposits   2,241,123    2,503    0.45%   2,607,011    3,705    0.56%   3,043,000    7,091    0.95%
Total interest bearing deposits   14,324,639    6,817    0.19%   14,020,336    8,095    0.23%   13,136,868    13,179    0.41%
Federal funds purchased and securities sold under agreement to repurchase   218,186    68    0.13%   223,008    72    0.13%   307,540    245    0.32%
Other borrowings   1,337,654    4,779    1.45%   1,340,825    4,903    1.45%   1,341,059    4,802    1.45%
Subordinated notes and debentures   384,187    4,457    4.70%   383,489    4,581    4.74%   382,943    4,527    4.79%
Total interest bearing liabilities   16,264,666    16,121    0.40%   15,967,658    17,651    0.44%   15,168,410    22,753    0.61%
Non-interest bearing liabilities:                                             
Non-interest bearing deposits   5,184,828              5,288,933              4,419,136           
Other liabilities   207,597              179,362              177,819           
Total liabilities   21,657,091              21,435,953              19,765,365           
Stockholders' equity   3,169,108              3,262,069              2,973,456           
Total liabilities and stockholders' equity  $24,826,199             $24,698,022             $22,738,821           
Net interest income (FTE)       $151,208             $158,660             $150,844      
Net interest spread (FTE)             2.66%             2.74%             2.83%
Net interest margin (FTE) - quarter-to-date             2.76%             2.86%             2.99%
                                              
Net interest margin (FTE) - year-to-date             2.76%             2.89%             2.99%

 

 Page 7 

 

 

Simmons First National Corporation    SFNC
Consolidated - Selected Financial Data       
For the Quarters Ended    Mar 31      Dec 31      Sep 30      Jun 30      Mar 31  
(Unaudited)   2022    2021    2021    2021    2021 
($ in thousands, except share data)                         
QUARTER-TO-DATE                         
Financial Highlights - GAAP                         
Net Income  $65,095   $48,230   $80,561   $74,911   $67,407 
Diluted earnings per share   0.58    0.42    0.74    0.69    0.62 
Return on average assets   1.06%   0.77%   1.37%   1.29%   1.20%
Return on average common equity   8.33%   5.87%   10.42%   10.08%   9.20%
Return on tangible common equity   14.31%   9.98%   17.43%   17.25%   15.85%
Net interest margin (FTE)   2.76%   2.86%   2.85%   2.89%   2.99%
FTE adjustment   5,602    5,579    4,941    4,548    4,163 
Average diluted shares outstanding   113,026,911    114,491,119    108,359,890    108,822,175    108,655,293 
Shares repurchased under plan   513,725    2,625,348    1,806,205    -    130,916 
Average price of shares repurchased   31.25    29.69    28.48    -    23.53 
Cash dividends declared per common share   0.19    0.18    0.18    0.18    0.18 
Financial Highlights - Core (non-GAAP)                         
Core earnings (excludes non-core items) (1)  $67,159   $59,486   $79,350   $75,435   $63,995 
Core diluted earnings per share (1)   0.59    0.52    0.73    0.69    0.59 
Accretable yield on acquired loans   3,703    5,758    4,122    5,619    6,630 
Efficiency ratio (1)   62.95%   59.48%   58.10%   56.75%   57.25%
Core return on average assets (1)   1.10%   0.96%   1.35%   1.30%   1.14%
Core return on average common equity (1)   8.59%   7.24%   10.26%   10.15%   8.73%
Core return on tangible common equity (1)   14.74%   12.19%   17.18%   17.36%   15.08%
YEAR-TO-DATE                         
Financial Highlights - GAAP                         
Net Income  $65,095   $271,109   $222,879   $142,318   $67,407 
Diluted earnings per share   0.58    2.46    2.05    1.31    0.62 
Return on average assets   1.06%   1.15%   1.29%   1.25%   1.20%
Return on average common equity   8.33%   8.83%   9.91%   9.64%   9.20%
Return on tangible common equity   14.31%   14.99%   16.86%   16.56%   15.85%
Net interest margin (FTE)   2.76%   2.89%   2.91%   2.94%   2.99%
FTE adjustment   5,602    19,231    13,652    8,711    4,163 
Average diluted shares outstanding   113,026,911    110,198,094    108,667,928    108,746,439    108,655,293 
Cash dividends declared per common share   0.19    0.72    0.54    0.36    0.18 
Financial Highlights - Core (non-GAAP)                         
Core earnings (excludes non-core items) (1)  $67,159   $278,266   $218,780   $139,430   $63,995 
Core diluted earnings per share (1)   0.59    2.53    2.01    1.28    0.59 
Accretable yield on acquired loans   3,703    22,129    16,371    12,249    6,630 
Efficiency ratio (1)   62.95%   57.92%   57.37%   57.00%   57.25%
Core return on average assets (1)   1.10%   1.18%   1.27%   1.22%   1.14%
Core return on average common equity (1)   8.59%   9.06%   9.73%   9.45%   8.73%
Core return on tangible common equity (1)   14.74%   15.38%   16.56%   16.23%   15.08%
END OF PERIOD                         
Book value per share  $26.32   $28.82   $28.42   $28.03   $27.04 
Tangible book value per share   15.22    17.71    17.39    17.16    16.13 
Shares outstanding   112,505,555    112,715,444    106,603,231    108,386,669    108,345,732 
Full-time equivalent employees   2,893    2,877    2,740    2,783    2,817 
Total number of financial centers   197    199    185    198    198 
                          
 (1) Core earnings excludes non-core items, which is a non-GAAP measurement. Reconciliations to GAAP are included in the schedules accompanying this release.

 

 Page 8 

 

 

Simmons First National Corporation           SFNC
Reconciliation Of Non-GAAP Financial Measures - Core Earnings - Quarter-to-Date   
For the Quarters Ended  Mar 31  Dec 31  Sep 30  Jun 30  Mar 31
(Unaudited)  2022  2021  2021  2021  2021
($ in thousands, except per share data)               
QUARTER-TO-DATE               
Net Income  $65,095   $48,230   $80,561   $74,911   $67,407 
Non-core items                         
Gain on sale of branches   -    -    -    (16)   (5,300)
Merger-related costs   1,886    13,591    1,401    686    233 
Branch right-sizing (net)   909    1,648    (3,041)   39    448 
Tax effect (1)   (731)   (3,983)   429    (185)   1,207 
Net non-core items   2,064    11,256    (1,211)   524    (3,412)
Core earnings (non-GAAP)  $67,159   $59,486   $79,350   $75,435   $63,995 
                          
Diluted earnings per share  $0.58   $0.42   $0.74   $0.69   $0.62 
Non-core items                         
Gain on sale of branches   -    -    -    -    (0.05)
Merger-related costs   0.01    0.12    0.01    0.01    - 
Branch right-sizing (net)   0.01    0.01    (0.03)   -    0.01 
Tax effect (1)   (0.01)   (0.03)   0.01    (0.01)   0.01 
Net non-core items   0.01    0.10    (0.01)   -    (0.03)
Core diluted earnings per share (non-GAAP)  $0.59   $0.52   $0.73   $0.69   $0.59 
                          
(1) Effective tax rate of 26.135%.                         
                          
Reconciliation of Selected Non-Core Non-Interest Income and Expense Items (non-GAAP)  
                          
QUARTER-TO-DATE                         
Other income  $7,266   $9,965   $6,411   $8,397   $10,500 
Non-core items (1)   -    (2)   239    (445)   (5,477)
Core other income (non-GAAP)  $7,266   $9,963   $6,650   $7,952   $5,023 
                          
Non-interest expense  $128,417   $141,597   $114,333   $114,657   $113,002 
Non-core items (1)   (2,795)   (15,241)   1,879    (1,154)   (858)
Core non-interest expense (non-GAAP)  $125,622   $126,356   $116,212   $113,503   $112,144 
                          
Salaries and employee benefits  $67,906   $63,832   $61,902   $60,261   $60,340 
Non-core items (1)   -    -    (66)   -    - 
Core salaries and employee benefits (non-GAAP)  $67,906   $63,832   $61,836   $60,261   $60,340 
                          
Merger related costs  $1,886   $13,591   $1,401   $686   $233 
Non-core items (1)   (1,886)   (13,591)   (1,401)   (686)   (233)
Core merger related costs (non-GAAP)  $-   $-   $-   $-   $- 
                          
Other operating expenses  $41,646   $45,736   $34,565   $37,198   $36,063 
Non-core items (1)   (717)   96    3,759    (89)   (208)
Core other operating expenses (non-GAAP)  $40,929   $45,832   $38,324   $37,109   $35,855 
                          
 (1) Non-core items include gain on sale of branches, merger related costs and branch right-sizing costs.  

 

 

 Page 9 

 

 

Simmons First National Corporation    SFNC
Reconciliation Of Non-GAAP Financial Measures - Core Earnings - Year-to-Date   
For the Quarters Ended  Mar 31  Dec 31  Sep 30  Jun 30  Mar 31
(Unaudited)  2022  2021  2021  2021  2021
($ in thousands, except per share data)               
YEAR-TO-DATE               
Net Income  $65,095   $271,109   $222,879   $142,318   $67,407 
Non-core items                         
Gain on sale of branches   -    (5,316)   (5,316)   (5,316)   (5,300)
Merger-related costs   1,886    15,911    2,320    919    233 
Branch right-sizing (net)   909    (906)   (2,554)   487    448 
Tax effect (1)   (731)   (2,532)   1,451    1,022    1,207 
Net non-core items   2,064    7,157    (4,099)   (2,888)   (3,412)
Core earnings (non-GAAP)  $67,159   $278,266   $218,780   $139,430   $63,995 
                          
Diluted earnings per share  $0.58   $2.46   $2.05   $1.31   $0.62 
Non-core items                         
Gain on sale of branches   -    (0.05)   (0.05)   (0.05)   (0.05)
Merger-related costs   0.01    0.15    0.02    0.01    - 
Branch right-sizing (net)   0.01    (0.01)   (0.02)   -    0.01 
Tax effect (1)   (0.01)   (0.02)   0.01    0.01    0.01 
Net non-core items   0.01    0.07    (0.04)   (0.03)   (0.03)
Core diluted earnings per share (non-GAAP)  $0.59   $2.53   $2.01   $1.28   $0.59 
                          
(1) Effective tax rate of 26.135%.  
                          
Reconciliation of Selected Non-Core Non-Interest Income and Expense Items (non-GAAP)
                          
YEAR-TO-DATE                         
Other income  $7,266   $35,273   $25,308   $18,897   $10,500 
Non-core items (1)   -    (5,685)   (5,683)   (5,922)   (5,477)
Core other income (non-GAAP)  $7,266   $29,588   $19,625   $12,975   $5,023 
                          
Non-interest expense  $128,417   $483,589   $341,992   $227,659   $113,002 
Non-core items (1)   (2,795)   (15,374)   (133)   (2,012)   (858)
Core non-interest expense (non-GAAP)  $125,622   $468,215   $341,859   $225,647   $112,144 
                          
Salaries and employee benefits  $67,906   $246,335   $182,503   $120,601   $60,340 
Non-core items (1)   -    (66)   (66)   -    - 
Core salaries and employee benefits (non-GAAP)  $67,906   $246,269   $182,437   $120,601   $60,340 
                          
Merger related costs  $1,886   $15,911   $2,320   $919   $233 
Non-core items (1)   (1,886)   (15,911)   (2,320)   (919)   (233)
Core merger related costs (non-GAAP)  $-   $-   $-   $-   $- 
                          
Other operating expenses  $41,646   $153,562   $107,826   $73,261   $36,063 
Non-core items (1)   (717)   3,558    3,462    (297)   (208)
Core other operating expenses (non-GAAP)  $40,929   $157,120   $111,288   $72,964   $35,855 
                          
 (1) Non-core items include gain on sale of branches, merger related costs and branch right-sizing costs.  

 

 Page 10 

 

 

Simmons First National Corporation    SFNC
Reconciliation Of Non-GAAP Financial Measures - End of Period            
For the Quarters Ended  Mar 31  Dec 31  Sep 30  Jun 30  Mar 31
(Unaudited)  2022  2021  2021  2021  2021
($ in thousands, except per share data)               
                
Calculation of Tangible Common Equity and the Ratio of Tangible Common Equity to Tangible Assets      
                
Total common stockholders' equity  $2,961,607   $3,248,841   $3,029,764   $3,038,599   $2,930,008 
Intangible assets:                         
Goodwill   (1,147,007)   (1,146,007)   (1,075,305)   (1,075,305)   (1,075,305)
Other intangible assets   (102,748)   (106,235)   (100,428)   (103,759)   (107,091)
Total intangibles   (1,249,755)   (1,252,242)   (1,175,733)   (1,179,064)   (1,182,396)
Tangible common stockholders' equity  $1,711,852   $1,996,599   $1,854,031   $1,859,535   $1,747,612 
                          
Total assets  $24,482,268   $24,724,759   $23,225,930   $23,423,159   $23,348,117 
Intangible assets:                         
Goodwill   (1,147,007)   (1,146,007)   (1,075,305)   (1,075,305)   (1,075,305)
Other intangible assets   (102,748)   (106,235)   (100,428)   (103,759)   (107,091)
Total intangibles   (1,249,755)   (1,252,242)   (1,175,733)   (1,179,064)   (1,182,396)
Tangible assets  $23,232,513   $23,472,517   $22,050,197   $22,244,095   $22,165,721 
                          
Paycheck protection program ("PPP") loans   (61,887)   (116,659)   (212,087)   (441,353)   (797,629)
Total assets excluding PPP loans  $24,420,381   $24,608,100   $23,013,843   $22,981,806   $22,550,488 
Tangible assets excluding PPP loans  $23,170,626   $23,355,858   $21,838,110   $21,802,742   $21,368,092 
                          
Ratio of common equity to assets   12.10%   13.14%   13.04%   12.97%   12.55%
Ratio of common equity to assets excluding PPP loans   12.13%   13.20%   13.16%   13.22%   12.99%
Ratio of tangible common equity to tangible assets   7.37%   8.51%   8.41%   8.36%   7.88%
Ratio of tangible common equity to tangible assets excluding PPP loans   7.39%   8.55%   8.49%   8.53%   8.18%
                          
Calculation of Tangible Book Value per Share                         
                          
Total common stockholders' equity  $2,961,607   $3,248,841   $3,029,764   $3,038,599   $2,930,008 
Intangible assets:                         
Goodwill   (1,147,007)   (1,146,007)   (1,075,305)   (1,075,305)   (1,075,305)
Other intangible assets   (102,748)   (106,235)   (100,428)   (103,759)   (107,091)
Total intangibles   (1,249,755)   (1,252,242)   (1,175,733)   (1,179,064)   (1,182,396)
Tangible common stockholders' equity  $1,711,852   $1,996,599   $1,854,031   $1,859,535   $1,747,612 
Shares of common stock outstanding   112,505,555    112,715,444    106,603,231    108,386,669    108,345,732 
Book value per common share  $26.32   $28.82   $28.42   $28.03   $27.04 
Tangible book value per common share  $15.22   $17.71   $17.39   $17.16   $16.13 

 

 Page 11 

 

 

Simmons First National Corporation    SFNC
Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date     
For the Quarters Ended  Mar 31  Dec 31  Sep 30  Jun 30  Mar 31
(Unaudited)  2022  2021  2021  2021  2021
($ in thousands)               
Calculation of Core Return on Average Assets               
                
Net income  $65,095   $48,230   $80,561   $74,911   $67,407 
Net non-core items, net of taxes, adjustment   2,064    11,256    (1,211)   524    (3,412)
Core earnings  $67,159   $59,486   $79,350   $75,435   $63,995 
                          
Average total assets  $24,826,199   $24,698,022   $23,255,541   $23,257,921   $22,738,821 
                          
Return on average assets   1.06%   0.77%   1.37%   1.29%   1.20%
Core return on average assets   1.10%   0.96%   1.35%   1.30%   1.14%
                          
Calculation of Return on Tangible Common Equity                         
                          
Net income  $65,095   $48,230   $80,561   $74,911   $67,407 
Amortization of intangibles, net of taxes   2,575    2,575    2,460    2,462    2,470 
Total income available to common stockholders  $67,670   $50,805   $83,021   $77,373   $69,877 
                          
Net non-core items, net of taxes   2,064    11,256    (1,211)   524    (3,412)
Core earnings   67,159    59,486    79,350    75,435    63,995 
Amortization of intangibles, net of taxes   2,575    2,575    2,460    2,462    2,470 
Total core income available to common stockholders  $69,734   $62,061   $81,810   $77,897   $66,465 
                          
Average common stockholders' equity  $3,169,108   $3,261,627   $3,067,205   $2,980,609   $2,972,689 
Average intangible assets:                         
Goodwill   (1,146,034)   (1,137,441)   (1,075,305)   (1,075,305)   (1,075,305)
Other intangibles   (104,905)   (105,155)   (102,576)   (105,785)   (109,850)
Total average intangibles   (1,250,939)   (1,242,596)   (1,177,881)   (1,181,090)   (1,185,155)
Average tangible common stockholders' equity  $1,918,169   $2,019,031   $1,889,324   $1,799,519   $1,787,534 
                          
Return on average common equity   8.33%   5.87%   10.42%   10.08%   9.20%
Return on tangible common equity   14.31%   9.98%   17.43%   17.25%   15.85%
Core return on average common equity   8.59%   7.24%   10.26%   10.15%   8.73%
Core return on tangible common equity   14.74%   12.19%   17.18%   17.36%   15.08%
                          
Calculation of Efficiency Ratio (1)                         
                          
Non-interest expense  $128,417   $141,597   $114,333   $114,657   $113,002 
Non-core non-interest expense adjustment   (2,795)   (15,241)   1,879    (1,154)   (858)
Other real estate and foreclosure expense adjustment   (343)   (576)   (339)   (863)   (343)
Amortization of intangibles adjustment   (3,486)   (3,486)   (3,331)   (3,333)   (3,344)
Efficiency ratio numerator  $121,793   $122,294   $112,542   $109,307   $108,457 
                          
Net-interest income  $145,606   $153,081   $145,237   $146,533   $146,681 
Non-interest income   42,218    46,601    48,550    47,115    49,549 
Non-core non-interest income adjustment   -    (2)   239    (445)   (5,477)
Fully tax-equivalent adjustment (effective tax rate of 26.135%)   5,602    5,579    4,941    4,548    4,163 
Loss (gain) on sale of securities   54    348    (5,248)   (5,127)   (5,471)
Efficiency ratio denominator  $193,480   $205,607   $193,719   $192,624   $189,445 
                          
Efficiency ratio (1)   62.95%   59.48%   58.10%   56.75%   57.25%
                          
(1) Efficiency ratio is core non-interest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and non-interest revenues, excluding gains and losses from securities transactions and non-core items.

 

 Page 12 

 

Simmons First National Corporation    SFNC
Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date (continued)     
For the Quarters Ended  Mar 31  Dec 31  Sep 30  Jun 30  Mar 31
(Unaudited)  2022  2021  2021  2021  2021
($ in thousands)               
Calculation of Adjusted Net Interest Margin               
                
Net interest income  $145,606   $153,081   $145,237   $146,533   $146,681 
Fully tax-equivalent adjustment (effective tax rate of 26.135%)   5,602    5,579    4,941    4,548    4,163 
Fully tax-equivalent net interest income   151,208    158,660    150,178    151,081    150,844 
PPP loan interest income   (2,113)   (5,107)   (9,614)   (8,958)   (11,652)
Net interest income adjusted for PPP loans  $149,095   $153,553   $140,564   $142,123   $139,192 
                          
Average earning assets  $22,185,215   $22,029,792   $20,901,992   $20,959,642   $20,484,908 
Average PPP loan balance   (89,757)   (172,130)   (359,828)   (707,296)   (891,070)
Average earning assets adjusted for PPP loans  $22,095,458   $21,857,662   $20,542,164   $20,252,346   $19,593,838 
                          
Net interest margin   2.76%   2.86%   2.85%   2.89%   2.99%
Net interest margin adjusted for PPP loans   2.74%   2.79%   2.71%   2.81%   2.88%
                          
Calculation of Adjusted Pre-Tax, Pre-Provision (PTPP) Earnings                         
                          
Net income available to common stockholders  $65,095   $48,230   $80,561   $74,911   $67,407 
Provision for income taxes   14,226    11,155    18,770    17,018    14,363 
Provision for credit losses (including provision for unfunded commitments)   (19,914)   (1,308)   (19,890)   (12,951)   1,445 
Loss (gain) on sale of securities   54    348    (5,248)   (5,127)   (5,471)
Net pre-tax non-core items   2,795    15,239    (1,640)   709    (4,619)
Adjusted pre-tax, pre-provision (PTPP) earnings  $62,256   $73,664   $72,553   $74,560   $73,125 

 

 Page 13 

 

 

Simmons First National Corporation    SFNC
Reconciliation Of Non-GAAP Financial Measures - Year-to-Date     
For the Quarters Ended  Mar 31  Dec 31  Sep 30  Jun 30  Mar 31
(Unaudited)  2022  2021  2021  2021  2021
($ in thousands)               
Calculation of Core Return on Average Assets               
                
Net income  $65,095   $271,109   $222,879   $142,318   $67,407 
Net non-core items, net of taxes, adjustment   2,064    7,157    (4,099)   (2,888)   (3,412)
Core earnings  $67,159   $278,266   $218,780   $139,430   $63,995 
                          
Average total assets  $24,826,199   $23,492,308   $23,085,987   $22,999,805   $22,738,821 
                          
Return on average assets   1.06%   1.15%   1.29%   1.25%   1.20%
Core return on average assets   1.10%   1.18%   1.27%   1.22%   1.14%
                          
Calculation of Return on Tangible Common Equity                         
                          
Net income  $65,095   $271,109   $222,879   $142,318   $67,407 
Amortization of intangibles, net of taxes   2,575    9,967    7,392    4,932    2,470 
Total income available to common stockholders  $67,670   $281,076   $230,271   $147,250   $69,877 
                          
Net non-core items, net of taxes   2,064    7,157    (4,099)   (2,888)   (3,412)
Core earnings   67,159    278,266    218,780    139,430    63,995 
Amortization of intangibles, net of taxes   2,575    9,967    7,392    4,932    2,470 
Total core income available to common stockholders  $69,734   $288,233   $226,172   $144,362   $66,465 
                          
Average common stockholders' equity  $3,169,108   $3,071,313   $3,007,181   $2,976,671   $2,972,689 
Average intangible assets:                         
Goodwill   (1,146,034)   (1,090,967)   (1,075,305)   (1,075,305)   (1,075,305)
Other intangibles   (104,905)   (105,820)   (106,043)   (107,806)   (109,850)
Total average intangibles   (1,250,939)   (1,196,787)   (1,181,348)   (1,183,111)   (1,185,155)
Average tangible common stockholders' equity  $1,918,169   $1,874,526   $1,825,833   $1,793,560   $1,787,534 
                          
Return on average common equity   8.33%   8.83%   9.91%   9.64%   9.20%
Return on tangible common equity   14.31%   14.99%   16.86%   16.56%   15.85%
Core return on average common equity   8.59%   9.06%   9.73%   9.45%   8.73%
Core return on tangible common equity   14.74%   15.38%   16.56%   16.23%   15.08%
                          
Calculation of Efficiency Ratio (1)                         
                          
Non-interest expense  $128,417   $483,589   $341,992   $227,659   $113,002 
Non-core non-interest expense adjustment   (2,795)   (15,374)   (133)   (2,012)   (858)
Other real estate and foreclosure expense adjustment   (343)   (2,121)   (1,545)   (1,206)   (343)
Amortization of intangibles adjustment   (3,486)   (13,494)   (10,008)   (6,677)   (3,344)
Efficiency ratio numerator  $121,793   $452,600   $330,306   $217,764   $108,457 
                          
Net-interest income  $145,606   $591,532   $438,451   $293,214   $146,681 
Non-interest income   42,218    191,815    145,214    96,664    49,549 
Non-core non-interest income adjustment   -    (5,685)   (5,683)   (5,922)   (5,477)
Fully tax-equivalent adjustment (effective tax rate of 26.135%)   5,602    19,231    13,652    8,711    4,163 
Gain on sale of securities   54    (15,498)   (15,846)   (10,598)   (5,471)
Efficiency ratio denominator  $193,480   $781,395   $575,788   $382,069   $189,445 
                          
Efficiency ratio (1)   62.95%   57.92%   57.37%   57.00%   57.25%
                          
(1) Efficiency ratio is core non-interest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and non-interest revenues, excluding gains and losses from securities transactions and non-core items.

 

 Page 14 

 

 

Simmons First National Corporation    SFNC
Reconciliation Of Non-GAAP Financial Measures - Year-to-Date (continued)     
For the Quarters Ended  Mar 31  Dec 31  Sep 30  Jun 30  Mar 31
(Unaudited)  2022  2021  2021  2021  2021
($ in thousands)               
Calculation of Adjusted Pre-Tax, Pre-Provision (PTPP) Earnings               
                
Net income available to common stockholders  $65,095   $271,109   $222,879   $142,318   $67,407 
Provision for income taxes   14,226    61,306    50,151    31,381    14,363 
Provision for credit losses (including provision for unfunded commitments)   (19,914)   (32,704)   (31,396)   (11,506)   1,445 
Loss (gain) on sale of securities   54    (15,498)   (15,846)   (10,598)   (5,471)
Adjustments, pre-tax   2,795    9,689    (5,550)   (3,910)   (4,619)
Adjusted pre-tax, pre-provision (PTPP) earnings  $62,256   $293,902   $220,238   $147,685   $73,125 

 

 

 

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