HBT Financial, Inc. Announces Third Quarter 2023 Financial Results

October 23, 2023 at 6:05 AM EDT

Third Quarter Highlights

  • Net income of $19.7 million, or $0.62 per diluted share; return on average assets (ROAA) of 1.58%; return on average stockholders' equity (ROAE) of 17.02%; and return on average tangible common equity (ROATCE)(1) of 20.70%
  • Adjusted net income(1) of $20.3 million; or $0.63 per diluted share; adjusted ROAA(1) of 1.62%; adjusted ROAE(1) of 17.51%; and adjusted ROATCE(1) of 21.29%
  • Asset quality remained strong with nonperforming assets to total assets of 0.16%
  • Net interest margin of 4.07% and net interest margin (tax-equivalent basis)(1) of 4.13%

BLOOMINGTON, Ill., Oct. 23, 2023 (GLOBE NEWSWIRE) -- HBT Financial, Inc. (NASDAQ: HBT) (the “Company” or “HBT Financial” or “HBT”), the holding company for Heartland Bank and Trust Company, today reported net income of $19.7 million, or $0.62 diluted earnings per share, for the third quarter of 2023. This compares to net income of $18.5 million, or $0.58 diluted earnings per share, for the second quarter of 2023, and net income of $15.6 million, or $0.54 diluted earnings per share, for the third quarter of 2022.

J. Lance Carter, President and Chief Executive Officer of HBT Financial, said, “This was another strong quarter of profitability with a ROAA of 1.58%, a ROATCE of 20.70%, and our highest quarterly diluted earnings per share since our IPO in October of 2019. Our balance sheet strength continues to show with our core deposit franchise allowing us to maintain a low cost of funds of 0.96% and credit quality remaining solid with nonperforming assets at only 0.16% of total assets. Our net interest margin remained very solid at 4.13% on a tax-equivalent basis(1) as loan growth and asset mix improvement continue to partially offset funding cost increases. We have continued to maintain our consistently conservative underwriting standards while also increasing loans by 3% during the quarter. In addition, our loan portfolio remains very well diversified with limited exposure to higher risk segments, such as office commercial real estate. Despite a decrease in accumulated other comprehensive income (loss) due to rising interest rates during the quarter, we were able to increase all capital measures and maintain a strong capital base providing us with flexibility for future capital deployment. We believe our consistent financial performance will enable us to continue enhancing the value of our franchise.”
____________________________________
(1)    See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
        comparable GAAP financial measures.

Adjusted Net Income

In addition to reporting GAAP results, the Company believes non-GAAP measures such as adjusted net income and adjusted earnings per share, which adjust for acquisition expenses, branch closure expenses, gains (losses) on sale of closed branch premises, net earnings (losses) from closed or sold operations, charges related to termination of certain employee benefit plans, realized gains (losses) on sales of securities, and mortgage servicing rights fair value adjustments, provide investors with additional insight into its operational performance. The Company reported adjusted net income of $20.3 million, or $0.63 adjusted diluted earnings per share, for the third quarter of 2023. This compares to adjusted net income of $18.8 million, or $0.58 adjusted diluted earnings per share, for the second quarter of 2023, and adjusted net income of $15.9 million, or $0.55 adjusted diluted earnings per share, for the third quarter of 2022 (see "Reconciliation of Non-GAAP Financial Measures" tables below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures).

Net Interest Income and Net Interest Margin

Net interest income for the third quarter of 2023 was $48.3 million, a slight decrease from $48.9 million for the second quarter of 2023. The decrease was primarily attributable to an increase in funding costs which were largely offset by higher yields on loans and a more favorable interest-earning asset mix.

Relative to the third quarter of 2022, net interest income increased 29.1% from $37.4 million. The increase was primarily attributable to the increase in average interest-earning assets following the Town and Country Financial Corporation (“Town and Country”) merger completed in the first quarter of 2023 and higher yields on interest-earning assets.

Net interest margin for the third quarter of 2023 was 4.07%, compared to 4.16% for the second quarter of 2023, and net interest margin (tax-equivalent basis)(1) for the third quarter of 2023 was 4.13% compared to 4.22% for the second quarter of 2023. The decrease was primarily attributable to higher funding costs with the cost of funds increasing to 0.96% for the third quarter of 2023, compared to 0.71% for the second quarter of 2023, partially offset by higher yields on loans and a more favorable interest-earning asset mix.

Relative to the third quarter of 2022, net interest margin increased from 3.65%. This increase was primarily attributable to higher yields on interest-earning assets.
____________________________________
(1)   See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
       comparable GAAP financial measures.

Noninterest Income

Noninterest income for the third quarter of 2023 was $9.5 million, a decrease of 4.3% from $9.9 million for the second quarter of 2023. The decrease was primarily attributable to $0.8 million of losses realized on the sale of debt securities during the third quarter of 2023 which were not present in the second quarter of 2023 results. Partially offsetting these losses was a $0.6 million gain on sale of foreclosed assets compared to a $0.1 million loss included in the second quarter of 2023 results.

Relative to the third quarter of 2022, noninterest income increased 15.3% from $8.2 million. The increase was primarily attributable to the Town and Country merger completed in the first quarter of 2023 which contributed to a $0.5 million increase in mortgage servicing income, a $0.3 million increase in wealth management fees, and a $0.2 million increase in card income.

Noninterest Expense

Noninterest expense for the third quarter of 2023 was $30.7 million, a 9.7% decrease from $34.0 million for the second quarter of 2023. The decrease was primarily attributable to the realization of planned cost reductions following the Town and Country core system conversion completed in April 2023. Additionally, the absence of $0.8 million of legal fees and $0.8 million of accruals related to pending legal matters previously disclosed during the second quarter of 2023 further contributed to the decrease in noninterest expense during the third quarter of 2023.

Relative to the third quarter of 2022, noninterest expense increased 27.8% from $24.0 million, primarily attributable to the addition of Town and Country’s operations.

Acquisition-related expenses recognized are summarized below. No acquisition-related expenses were recognized subsequent to the second quarter of 2023, and we do not expect material acquisition-related expenses related to Town and Country in subsequent quarters.

    
 Three Months Ended Nine Months Ended
September 30,

 
(dollars in thousands)September
30,

2023
 June 30,
2023
 September
30,

2022
 2023 2022 
                
PROVISION FOR CREDIT LOSSES$ $ $ $5,924 $ 
NONINTEREST EXPENSE               
Salaries   66    3,584   
Furniture and equipment   39    39   
Data processing   176    2,031   
Marketing and customer relations   10    24   
Loan collection and servicing   125    125   
Legal fees and other noninterest expense   211  462  1,964  462 
Total noninterest expense   627  462  7,767  462 
Total acquisition-related expenses$ $627 $462 $13,691 $462 
                

Loan Portfolio

Total loans outstanding, before allowance for credit losses, were $3.34 billion at September 30, 2023, compared with $3.24 billion at June 30, 2023 and $2.58 billion at September 30, 2022. The $98.1 million increase from June 30, 2023 was primarily attributable to draws on existing construction projects and new fundings to primarily existing customers, in part driven by seasonally higher agricultural line of credit usage. Balance increases in the commercial real estate - non-owner occupied and multi-family categories were driven predominately by the completion of projects previously in the construction and land development category.

Deposits

Total deposits were $4.20 billion at September 30, 2023, compared with $4.16 billion at June 30, 2023 and $3.64 billion at September 30, 2022. The $33.5 million increase from June 30, 2023 was primarily attributable to a $64.0 million increase in brokered deposits, partially offset by decreases in balances held in mainly smaller balance accounts.

Asset Quality

Nonperforming loans totaled $6.7 million, or 0.20% of total loans, at September 30, 2023, compared with $7.5 million, or 0.23% of total loans, at June 30, 2023, and $3.2 million, or 0.12% of total loans, at September 30, 2022. Additionally, of the $6.7 million of nonperforming loans held as of September 30, 2023, $2.0 million is either wholly or partially guaranteed by the U.S. Government. The $0.9 million decrease in nonperforming loans from June 30, 2023 was primarily attributable to reductions as the result of foreclosures and charge-offs on several smaller credits.

The Company recorded a provision for credit losses of $0.5 million for the third quarter of 2023. The provision for credit losses primarily reflects a $0.9 million increase in required reserves driven by growth of the loan portfolio, a $0.8 million increase in required reserves resulting from changes in economic and qualitative factors, a $0.8 million decrease in reserves on debt securities available-for-sale, a $0.5 million decrease in specific reserve, and net recoveries of $0.1 million.

The Company had net recoveries of $0.1 million, or 0.01% of average loans on an annualized basis, for the third quarter of 2023, compared to net recoveries of $0.1 million, or 0.01% of average loans on an annualized basis, for the second quarter of 2023, and net charge-offs of $0.1 million, or 0.01% of average loans on an annualized basis, for the third quarter of 2022.

The Company’s allowance for credit losses was 1.16% of total loans and 582% of nonperforming loans at September 30, 2023, compared with 1.17% of total loans and 502% of nonperforming loans at June 30, 2023. In addition, the allowance for credit losses on unfunded lending-related commitments totaled $4.4 million as of September 30, 2023.

Stock Repurchase Program

During the third quarter of 2023, the Company repurchased 91,728 shares of its common stock at a weighted average price of $18.48 under its stock repurchase program. The Company’s Board of Directors have authorized the repurchase of up to $15 million of HBT Financial common stock under its stock repurchase program in effect until January 1, 2024. As of September 30, 2023, the Company had $7.6 million remaining under the current stock repurchase authorization.

About HBT Financial, Inc.

HBT Financial, Inc., headquartered in Bloomington, Illinois, is the holding company for Heartland Bank and Trust Company, and has banking roots that can be traced back to 1920. HBT provides a comprehensive suite of business, commercial, wealth management, and retail banking products and services to individuals, businesses and municipal entities throughout Illinois and Eastern Iowa through 67 full-service branches. As of September 30, 2023, HBT had total assets of $5.0 billion, total loans of $3.3 billion, and total deposits of $4.2 billion.

Non-GAAP Financial Measures

Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with GAAP. These non-GAAP financial measures include net interest income (tax-equivalent basis), net interest margin (tax-equivalent basis), efficiency ratio (tax-equivalent basis), tangible common equity to tangible assets, tangible book value per share, return on average tangible common equity, adjusted net income, adjusted earnings per share, adjusted return on average assets, adjusted return on average stockholders' equity, and adjusted return on average tangible common equity. Our management uses these non-GAAP financial measures, together with the related GAAP financial measures, in its analysis of our performance and in making business decisions. Management believes that it is a standard practice in the banking industry to present these non-GAAP financial measures, and accordingly believes that providing these measures may be useful for peer comparison purposes. These disclosures should not be viewed as substitutes for the results determined to be in accordance with GAAP; nor are they necessarily comparable to non-GAAP financial measures that may be presented by other companies. See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures in the "Reconciliation of Non-GAAP Financial Measures" tables.

Forward-Looking Statements

Readers should note that in addition to the historical information contained herein, this press release contains, and future oral and written statements of the Company and its management may contain, "forward-looking statements" within the meanings of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "will," "propose," "may," "plan," "seek," "expect," "intend," "estimate," "anticipate," "believe," "continue," or “should,” or similar terminology. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to: (i) the strength of the local, state, national and international economies (including effects of inflationary pressures and supply chain constraints); (ii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics (including the COVID-19 pandemic in the United States), acts of war or other threats thereof (including the Israeli-Palestinian conflict and the Russian invasion of Ukraine), or other adverse external events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies, the FASB or the PCAOB (including the Company’s adoption of the current expected credit losses (“CECL”) methodology); (iv) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business and any changes in response to the recent failures of other banks; (v) changes in interest rates and prepayment rates of the Company’s assets (including the impact of LIBOR phase-out and the recent and potential additional rate increases by the Federal Reserve); (vi) increased competition in the financial services sector, including from non-bank competitors such as credit unions and “fintech” companies, and the inability to attract new customers; (vii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (viii) unexpected results of acquisitions, which may include failure to realize the anticipated benefits of acquisitions and the possibility that transaction costs may be greater than anticipated; (ix) the loss of key executives or employees; (x) changes in consumer spending; (xi) unexpected outcomes of existing or new litigation involving the Company; (xii) the economic impact of exceptional weather occurrences such as tornadoes, floods and blizzards; (xiii) fluctuations in the value of securities held in our securities portfolio; (xiv) concentrations within our loan portfolio, large loans to certain borrowers, and large deposits from certain clients; (xv) the concentration of large deposits from certain clients who have balances above current FDIC insurance limits and may withdraw deposits to diversify their exposure; (xvi) the level of non-performing assets on our balance sheets; (xvii) interruptions involving our information technology and communications systems or third-party servicers; (xviii) breaches or failures of our information security controls or cybersecurity-related incidents, and (xix) the ability of the Company to manage the risks associated with the foregoing as well as anticipated. Readers should note that the forward-looking statements included in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.

CONTACT:
Peter Chapman
HBTIR@hbtbank.com
(309) 664-4556

 
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
 As of or for the Three Months Ended Nine Months Ended September 30,
 
(dollars in thousands, except per share data)September 30,
2023
 June 30,
2023
 September 30,
2022
  2023  2022 
Interest and dividend income$59,041  $56,768  $39,014  $167,588  $108,106  
Interest expense 10,762   7,896   1,624   23,600   4,415  
Net interest income 48,279   48,872   37,390   143,988   103,691  
Provision for credit losses 480   (230)  386   6,460   (53) 
Net interest income after provision for credit losses 47,799   49,102   37,004   137,528   103,744  
Noninterest income 9,490   9,914   8,234   26,841   26,828  
Noninterest expense 30,671   33,973   23,998   100,577   71,997  
Income before income tax expense 26,618   25,043   21,240   63,792   58,575  
Income tax expense 6,903   6,570   5,613   16,396   15,259  
Net income$19,715  $18,473  $15,627  $47,396  $43,316  
                              
Earnings per share - Diluted$0.62  $0.58  $0.54  $1.49  $1.49  
                              
Adjusted net income (1)$20,279  $18,772  $15,856  $58,910  $41,919  
Adjusted earnings per share - Diluted (1) 0.63   0.58   0.55   1.86   1.45  
                              
Book value per share$14.36  $14.15  $12.49             
Tangible book value per share (1) 11.80   11.58   11.43             
                              
Shares of common stock outstanding 31,774,140   31,865,868   28,752,626             
Weighted average shares of common stock
outstanding
 31,829,250   31,980,133   28,787,662   31,598,650   28,887,757  
                     
SUMMARY RATIOS                    
Net interest margin * 4.07%  4.16%  3.65%  4.14%  3.36% 
Net interest margin (tax-equivalent basis) * (1)(2) 4.13   4.22   3.72   4.20   3.41  
                     
Efficiency ratio 51.85%  56.57%  52.07%  57.73%  54.60% 
Efficiency ratio (tax-equivalent basis) (1)(2) 51.25   55.89   51.31   57.04   53.86  
                              
Loan to deposit ratio 79.63%  77.91%  70.81%           
                              
Return on average assets * 1.58%  1.49%  1.47%  1.29%  1.35% 
Return on average stockholders' equity * 17.02   16.30   16.27   14.22   14.91  
Return on average tangible common equity * (1) 20.70   19.91   17.70   17.17   16.20  
                     
Adjusted return on average assets * (1) 1.62%  1.51%  1.49%  1.61%  1.31% 
Adjusted return on average stockholders' equity * (1) 17.51   16.57   16.51   17.68   14.43  
Adjusted return on average tangible common equity *
(1)
 21.29   20.23   17.96   21.34   15.67  
                     
CAPITAL                     
Total capital to risk-weighted assets 15.09%  15.03%  16.34%            
Tier 1 capital to risk-weighted assets 13.18   13.12   14.26          
Common equity tier 1 capital ratio 11.88   11.78   13.08          
Tier 1 leverage ratio 10.34   10.07   10.44          
Total stockholders' equity to total assets 9.14   9.06   8.52          
Tangible common equity to tangible assets (1) 7.64   7.54   7.85          
                     
ASSET QUALITY                    
Net charge-offs (recoveries) to average loans (0.01)%  (0.01)%  0.01%  (0.01)%  (0.06)% 
Allowance for credit losses to loans, before allowance
for credit losses
 1.16   1.17   0.97          
Nonperforming loans to loans, before allowance for
credit losses
 0.20   0.23   0.12          
Nonperforming assets to total assets 0.16   0.21   0.14          
                     
*      Annualized measure.
(1)   See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
       comparable GAAP financial measures.
(2)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.
                     


HBT Financial, Inc.
Unaudited Consolidated Financial Summary
Consolidated Statements of Income
 
 Three Months Ended Nine Months Ended September 30,
 
(dollars in thousands, except per share data)September 30,
2023
 June 30,
2023
 September 30,
2022
  2023   2022  
INTEREST AND DIVIDEND INCOME                    
Loans, including fees:                    
Taxable$49,640  $47,149  $29,855  $138,948  $84,504  
Federally tax exempt 1,072   1,040   842   3,064   2,183  
Securities:         
Taxable 6,451   6,518   6,635   19,585   16,947  
Federally tax exempt 978   1,162   1,207   3,337   3,385  
Interest-bearing deposits in bank 714   781   458   2,234   1,037  
Other interest and dividend income 186   118   17   420   50  
     Total interest and dividend income 59,041   56,768   39,014   167,588   108,106  
INTEREST EXPENSE         
Deposits 7,211   4,323   587   13,908   1,662  
Securities sold under agreements to repurchase 35   34   9   107   26  
Borrowings 2,108   2,189   85   5,594   87  
Subordinated notes 470   469   470   1,409   1,409  
Junior subordinated debentures issued to capital
trusts
 938   881   473   2,582   1,231  
     Total interest expense 10,762   7,896   1,624   23,600   4,415  
     Net interest income 48,279   48,872   37,390   143,988   103,691  
PROVISION FOR CREDIT LOSSES 480   (230)  386   6,460   (53) 
     Net interest income after provision for credit
     losses
 47,799   49,102   37,004   137,528   103,744  
NONINTEREST INCOME                    
Card income 2,763   2,905   2,569   8,326   7,687  
Wealth management fees 2,381   2,279   2,059   6,998   6,670  
Service charges on deposit accounts 2,040   1,919   1,927   5,830   5,371  
Mortgage servicing 1,169   1,254   697   3,522   2,016  
Mortgage servicing rights fair value adjustment 23   141   351   (460)  2,446  
Gains on sale of mortgage loans 476   373   354   1,125   1,267  
Realized gains (losses) on sales of securities (813)        (1,820)    
Unrealized gains (losses) on equity securities (46)  7   (107)  (61)  (447) 
Gains (losses) on foreclosed assets 550   (97)  (225)  443   (192) 
Gains (losses) on other assets 52   109   (31)  161   119  
Income on bank owned life insurance 153   147   41   415   122  
Other noninterest income 742   877   599   2,362   1,769  
     Total noninterest income 9,490   9,914   8,234   26,841   26,828  
NONINTEREST EXPENSE                    
Salaries 15,644   16,660   12,752   51,715   38,489  
Employee benefits 2,616   2,707   1,771   7,658   6,199  
Occupancy of bank premises 2,573   2,785   1,979   7,460   5,780  
Furniture and equipment 667   809   668   2,135   1,843  
Data processing 2,581   2,883   1,631   9,787   5,274  
Marketing and customer relations 1,679   1,359   880   3,874   2,936  
Amortization of intangible assets 720   720   243   1,950   733  
FDIC insurance 512   630   302   1,705   888  
Loan collection and servicing 345   348   336   971   771  
Foreclosed assets 76   97   97   234   260  
Other noninterest expense 3,258   4,975   3,339   13,088   8,824  
     Total noninterest expense 30,671   33,973   23,998   100,577   71,997  
INCOME BEFORE INCOME TAX EXPENSE 26,618   25,043   21,240   63,792   58,575  
INCOME TAX EXPENSE 6,903   6,570   5,613   16,396   15,259  
NET INCOME$19,715  $18,473  $15,627  $47,396  $43,316  
                     
EARNINGS PER SHARE - BASIC$0.62  $0.58  $0.54  $1.50  $1.50  
EARNINGS PER SHARE - DILUTED$0.62  $0.58  $0.54  $1.49  $1.49  
WEIGHTED AVERAGE SHARES OF COMMON
STOCK OUTSTANDING
 31,829,250   31,980,133   28,787,662   31,598,650   28,887,757  
 


HBT Financial, Inc.
Unaudited Consolidated Financial Summary
Consolidated Balance Sheets
 
(dollars in thousands)September 30,
2023
 June 30, 2023 September 30,
2022

 
ASSETS            
Cash and due from banks$24,757  $28,044  $22,169  
Interest-bearing deposits with banks 87,156   81,764   56,046  
Cash and cash equivalents 111,913   109,808   78,215  
             
Interest-bearing time deposits with banks 500        
Debt securities available-for-sale, at fair value 753,163   822,788   853,740  
Debt securities held-to-maturity 527,144   533,231   546,694  
Equity securities with readily determinable fair value 3,106   3,152   2,996  
Equity securities with no readily determinable fair value 2,300   2,275   1,977  
Restricted stock, at cost 11,165   11,345   4,050  
Loans held for sale 3,563   8,829   2,297  
             
Loans, before allowance for credit losses 3,342,786   3,244,655   2,579,928  
Allowance for credit losses (38,863)  (37,814)  (25,060) 
Loans, net of allowance for credit losses 3,303,923   3,206,841   2,554,868  
             
Bank owned life insurance 23,747   23,594   7,515  
Bank premises and equipment, net 64,713   65,029   50,854  
Bank premises held for sale 35   35   281  
Foreclosed assets 1,519   3,080   2,637  
Goodwill 59,820   59,876   29,322  
Intangible assets, net 21,402   22,122   1,210  
Mortgage servicing rights, at fair value 20,156   20,133   10,440  
Investments in unconsolidated subsidiaries 1,614   1,614   1,165  
Accrued interest receivable 23,447   19,900   16,881  
Other assets 58,538   62,158   48,182  
   Total assets$4,991,768  $4,975,810  $4,213,324  
             
LIABILITIES AND STOCKHOLDERS' EQUITY            
Liabilities            
Deposits:            
Noninterest-bearing$1,086,877  $1,125,823  $1,017,710  
Interest-bearing 3,111,191   3,038,700   2,625,733  
Total deposits 4,198,068   4,164,523   3,643,443  
      
Securities sold under agreements to repurchase 28,900   38,729   48,130  
Federal Home Loan Bank advances 177,650   177,572   60,000  
Subordinated notes 39,454   39,435   39,376  
Junior subordinated debentures issued to capital trusts 52,774   52,760   37,763  
Other liabilities 38,671   51,939   25,539  
   Total liabilities 4,535,517   4,524,958   3,854,251  
             
Stockholders' Equity            
Common stock 327   327   293  
Surplus 295,483   294,875   222,436  
Retained earnings 256,050   241,777   223,495  
Accumulated other comprehensive income (loss) (78,432)  (70,662)  (77,462) 
Treasury stock at cost (17,177)  (15,465)  (9,689) 
   Total stockholders’ equity 456,251   450,852   359,073  
   Total liabilities and stockholders’ equity$4,991,768  $4,975,810  $4,213,324  
SHARES OF COMMON STOCK OUTSTANDING 31,774,140   31,865,868   28,752,626  
 


HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
(dollars in thousands)September 30,
2023
 June 30, 2023 September 30,
2022

 
         
LOANS        
Commercial and industrial$386,933 $385,768 $240,671 
Commercial real estate - owner occupied 297,242  303,522  226,524 
Commercial real estate - non-owner occupied 901,929  882,598  718,089 
Construction and land development 371,158  335,262  364,290 
Multi-family 388,742  375,536  260,630 
One-to-four family residential 488,655  482,442  328,667 
Agricultural and farmland 275,239  259,858  245,234 
Municipal, consumer, and other 232,888  219,669  195,823 
Total loans$3,342,786 $3,244,655 $2,579,928 
 


(dollars in thousands)September 30,
2023
 June 30, 2023 September 30,
2022

 
          
DEPOSITS         
Noninterest-bearing deposits$1,086,877 $1,125,823 $1,017,710 
Interest-bearing deposits:         
Interest-bearing demand 1,134,721  1,181,187  1,131,284 
Money market (1) 673,780  730,652  584,202 
Savings 623,083  657,506  641,139 
Time (1) 679,607  469,355  269,108 
Total interest-bearing deposits 3,111,191  3,038,700  2,625,733 
Total deposits$4,198,068 $4,164,523 $3,643,443 
          
(1)   Time deposits include $115.0 million of brokered deposits as of September 30, 2023 and money market deposits include $51.0 million
        of brokered deposits as of June 30, 2023. There were no brokered deposits as of September 30, 2022.
 


HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
 Three Months Ended 
 September 30, 2023 June 30, 2023 September 30, 2022
 
(dollars in thousands)Average
Balance
 Interest Yield/Cost
*
 Average
Balance
 Interest Yield/Cost
*
 Average
Balance
 Interest Yield/Cost
*

 
                               
ASSETS                              
Loans$3,296,703  $50,712 6.10% $3,238,774  $48,189 5.97% $2,481,920  $30,697 4.91% 
Securities 1,324,686   7,429 2.22   1,384,180   7,680 2.23   1,470,092   7,842 2.12  
Deposits with banks 77,595   714 3.65   84,366   781 3.71   105,030   458 1.73  
Other 9,347   186 7.90   8,577   118 5.52   2,936   17 2.25  
Total interest-earning assets 4,708,331  $59,041 4.97%  4,715,897  $56,768 4.83%  4,059,978  $39,014 3.81% 
Allowance for credit losses (38,317)        (39,484)        (24,717)       
Noninterest-earning assets 294,818         299,622         173,461        
Total assets$4,964,832        $4,976,035        $4,208,722        
                               
LIABILITIES AND STOCKHOLDERS' EQUITY                              
Liabilities                              
Interest-bearing deposits:                              
Interest-bearing demand$1,160,654  $761 0.26% $1,224,285  $683 0.22% $1,137,072  $144 0.05% 
Money market 683,859   2,041 1.18   675,530   1,516 0.90   577,388   203 0.14  
Savings 639,384   249 0.15   687,014   189 0.11   649,752   53 0.03  
Time 585,372   4,160 2.82   447,146   1,935 1.74   271,870   187 0.27  
Total interest-bearing deposits 3,069,269   7,211 0.93   3,033,975   4,323 0.57   2,636,082   587 0.09  
Securities sold under agreements
to repurchase
 33,807   35 0.41   34,170   34 0.40   50,427   9 0.07  
Borrowings 157,908   2,108 5.30   173,040   2,189 5.07   11,967   85 2.80  
Subordinated notes 39,444   470 4.72   39,424   469 4.78   39,365   470 4.73  
Junior subordinated debentures
issued to capital trusts
 52,767   938 7.05   52,752   881 6.70   37,755   473 4.97  
Total interest-bearing liabilities 3,353,195  $10,762 1.27%  3,333,361  $7,896 0.95%  2,775,596  $1,624 0.23% 
Noninterest-bearing deposits 1,105,472         1,145,089         1,031,407        
Noninterest-bearing liabilities 46,564         43,080         20,736        
Total liabilities 4,505,231         4,521,530         3,827,739        
Stockholders' Equity 459,601         454,505         380,983        
Total liabilities and stockholders’ equity$4,964,832        $4,976,035        $4,208,722        
                               
Net interest income/Net interest
margin (1)
    $48,279 4.07%     $48,872 4.16%     $37,390 3.65% 
Tax-equivalent adjustment (2)     675 0.06       715 0.06       674 0.07  
Net interest income (tax-equivalent basis)/
Net interest margin (tax-equivalent
basis) (2) (3)
    $48,954 4.13%     $49,587 4.22%     $38,064 3.72% 
Net interest rate spread (4)       3.70%       3.88%        3.58% 
Net interest-earning assets (5)$1,355,136       $1,382,536      $1,284,382        
Ratio of interest-earning assets
to interest-bearing liabilities
 1.40        1.41       1.46        
Cost of total deposits       0.69%       0.41%        0.06% 
Cost of funds       0.96        0.71         0.17  
                              
*      Annualized measure.
(1)   Net interest margin represents net interest income divided by average total interest-earning assets.
(2)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state income tax rate of 9.5%.
(3)   See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
        comparable GAAP financial measures.
(4)   Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average
        interest-bearing liabilities.
(5)   Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
                               


HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
 Nine Months Ended
 
 September 30, 2023 September 30, 2022
 
(dollars in thousands)Average
Balance
 Interest
  Yield/Cost * Average
Balance
 Interest
  Yield/Cost *
 
                       
ASSETS                      
Loans$3,183,641  $142,012  5.96% $2,485,501  $86,687  4.66% 
Securities 1,373,175   22,922  2.23   1,405,245   20,332  1.93  
Deposits with banks 84,720   2,234  3.53   237,646   1,037  0.58  
Other 8,457   420  6.64   2,829   50  2.36  
Total interest-earning assets 4,649,993  $167,588  4.82%  4,131,221  $108,106  3.50% 
Allowance for credit losses (37,053)         (24,467)        
Noninterest-earning assets 289,843          172,243         
Total assets$4,902,783         $4,278,997         
                       
LIABILITIES AND STOCKHOLDERS' EQUITY                      
Liabilities                      
Interest-bearing deposits:                      
Interest-bearing demand$1,204,937  $1,902  0.21% $1,146,635  $430  0.05% 
Money market 664,846   4,492  0.90   585,815   434  0.10  
Savings 678,495   616  0.12   653,659   155  0.03  
Time 463,937   6,898  1.99   289,000   643  0.30  
Total interest-bearing deposits 3,012,215   13,908  0.62   2,675,109   1,662  0.08  
Securities sold under agreements
to repurchase
 35,844   107  0.40   51,503   26  0.07  
Borrowings 148,443   5,594  5.04   4,344   87  2.67  
Subordinated notes 39,424   1,409  4.78   39,345   1,409  4.79  
Junior subordinated debentures
issued to capital trusts
 51,054   2,582  6.76   37,738   1,231  4.36  
Total interest-bearing liabilities 3,286,980  $23,600  0.96%  2,808,039  $4,415  0.21% 
Noninterest-bearing deposits 1,123,917          1,060,566         
Noninterest-bearing liabilities 46,310          21,883         
Total liabilities 4,457,207          3,890,488         
Stockholders' Equity 445,576          388,509         
Total liabilities and stockholders’ equity$4,902,783          4,278,997         
                       
Net interest income/Net interest margin (1)    $143,988  4.14%     $103,691  3.36% 
Tax-equivalent adjustment (2)     2,092  0.06       1,801  0.05  
Net interest income (tax-equivalent basis)/
Net interest margin (tax-equivalent basis) (2) (3)
    $146,080  4.20%     $105,492  3.41% 
Net interest rate spread (4)        3.86%         3.29% 
Net interest-earning assets (5)$1,363,013        $1,323,182         
Ratio of interest-earning assets
to interest-bearing liabilities
 1.41         1.47         
Cost of total deposits        0.45%         0.06% 
Cost of funds        0.72          0.15  
                       
*      Annualized measure.
(1)   Net interest margin represents net interest income divided by average total interest-earning assets.
(2)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state income tax rate of 9.5%.
(3)   See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
        comparable GAAP financial measures.
(4)   Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average
        interest-bearing liabilities.
(5)   Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
                       


HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
(dollars in thousands)September 30,
2023
 June 30, 2023 September 30,
2022

 
             
NONPERFORMING ASSETS            
Nonaccrual$6,678  $7,534  $3,206  
Past due 90 days or more, still accruing (1)    1     
Total nonperforming loans 6,678   7,535   3,206  
Foreclosed assets 1,519   3,080   2,637  
Total nonperforming assets$8,197  $10,615  $5,843  
             
Nonperforming loans that are wholly or partially guaranteed by the U.S.
Government
$1,968  $2,332  $  
      
Allowance for credit losses$38,863  $37,814  $25,060  
Loans, before allowance for credit losses 3,342,786   3,244,655   2,579,928  
             
CREDIT QUALITY RATIOS            
Allowance for credit losses to loans, before allowance for credit losses 1.16%  1.17%  0.97% 
Allowance for credit losses to nonaccrual loans 581.96   501.91   781.66  
Allowance for credit losses to nonperforming loans 581.96   501.84   781.66  
Nonaccrual loans to loans, before allowance for credit losses 0.20   0.23   0.12  
Nonperforming loans to loans, before allowance for credit losses 0.20   0.23   0.12  
Nonperforming assets to total assets 0.16   0.21   0.14  
Nonperforming assets to loans, before allowance for credit losses, and
foreclosed assets
 0.25   0.33   0.23  
             
(1)    Prior to 2023, excludes loans acquired with deteriorated credit quality that are past due 90 or more days and accruing. Such loans
         totaled $22 thousand as of September 30, 2022.
             


HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
 Three Months Ended Nine Months Ended
September 30,

 
(dollars in thousands)September
30,

2023
 June 30,
2023
 September
30,

2022
 2023 2022
 
                     
ALLOWANCE FOR CREDIT LOSSES                    
Beginning balance$37,814  $38,776  $24,734  $25,333  $23,936  
Adoption of ASC 326          6,983     
PCD allowance established in acquisition          1,247     
Provision for credit losses 983   (1,080)  386   5,004   (53) 
Charge-offs (412)  (179)  (222)  (733)  (515) 
Recoveries 478   297   162   1,029   1,692  
Ending balance$38,863  $37,814  $25,060  $38,863  $25,060  
                     
Net charge-offs (recoveries)$(66) $(118) $60  $(296) $(1,177) 
Average loans 3,296,703   3,238,774   2,481,920   3,183,641   2,485,501  
                     
Net charge-offs (recoveries) to average loans * (0.01)%  (0.01)%  0.01%  (0.01)%  (0.06)% 
                     
*      Annualized measure.
 


 Three Months Ended  Nine Months Ended
September 30,

 
(dollars in thousands)September
30,

2023
 June 30,
2023
 September
30,

2022
  2023   2022  
                     
PROVISION FOR CREDIT LOSSES                    
Loans (1)$983  $(1,080) $386  $5,004  $(53) 
Unfunded lending-related commitments (1) 297   650      1,456     
Debt securities (800)  200           
Total provision for credit losses$480  $(230) $386  $6,460  $(53) 
                     
(1)    Includes recognition of an allowance for credit losses on non-PCD loans of $5.2 million and an allowance for credit losses on unfunded
        commitments of $0.7 million in connection with the Town and Country merger during the first quarter of 2023.
 


Reconciliation of Non-GAAP Financial Measures –
 
Adjusted Net Income and Adjusted Return on Average Assets
 
 
 Three Months Ended Nine Months Ended September 30,
 
(dollars in thousands)  September
30,
2023
 June 30,
2023 
 September 30,
2022 
 2023   2022 
Net income$19,715  $18,473  $15,627  $47,396  $43,316  
Adjustments:                    
Acquisition expenses (1)    (627)  (462)  (13,691)  (462) 
Gains (losses) on sales of closed branch
premises
    75   (38)  75   141  
Realized gains (losses) on sales of securities (813)        (1,820)    
Mortgage servicing rights fair value
adjustment
 23   141   351   (460)  2,446  
Total adjustments (790)  (411)  (149)  (15,896)  2,125  
Tax effect of adjustments 226   112   (80)  4,382   (728) 
Total adjustments after tax effect (564)  (299)  (229)  (11,514)  1,397  
Adjusted net income$20,279  $18,772  $15,856  $58,910  $41,919  
                     
Average assets$4,964,832  $4,976,035  $4,208,722  $4,902,783  $4,278,997  
                     
Return on average assets * 1.58%  1.49%  1.47%  1.29%  1.35% 
Adjusted return on average assets * 1.62   1.51   1.49   1.61   1.31  
                     
*      Annualized measure.
(1)   Includes recognition of an allowance for credit losses on non-PCD loans of $5.2 million and an allowance for credit losses on unfunded
       commitments of $0.7 million in connection with the Town and Country merger during the first quarter of 2023.
                     


Reconciliation of Non-GAAP Financial Measures –
 
Adjusted Earnings Per Share
 
 
 Three Months Ended  Nine Months Ended
September 30,

 
(dollars in thousands, except per share amounts)September
30,
2023

 June 30,
2023

 September
30,
2022
  2023
 2022
 
                     
Numerator:                    
Net income$19,715  $18,473  $15,627  $47,396  $43,316  
Earnings allocated to participating securities
(1)
 (10)  (11)  (17)  (26)  (51) 
Numerator for earnings per share - basic and
diluted
$19,705  $18,462  $15,610  $47,370  $43,265  
              
Adjusted net income$20,279  $18,772  $15,856  $58,910  $41,919  
Earnings allocated to participating securities
(1)
 (10)  (10)  (17)  (33)  (49) 
Numerator for adjusted earnings per share -
basic and diluted
$20,269  $18,762  $15,839  $58,877  $41,870  
                     
Denominator:                    
Weighted average common shares
outstanding
 31,829,250   31,980,133   28,787,662   31,598,650   28,887,757  
Dilutive effect of outstanding restricted stock
units
 137,187   99,850   72,643   102,574   56,761  
Weighted average common shares
outstanding, including all dilutive potential
shares
 31,966,437   32,079,983   28,860,305   31,701,224   28,944,518  
                     
Earnings per share - Basic$0.62  $0.58  $0.54  $1.50  $1.50  
Earnings per share - Diluted$0.62  $0.58  $0.54  $1.49  $1.49  
                     
Adjusted earnings per share - Basic$0.64  $0.59  $0.55  $1.86  $1.45  
Adjusted earnings per share - Diluted$0.63  $0.58  $0.55  $1.86  $1.45  
                     
(1)   The Company has granted certain restricted stock units that contain non-forfeitable rights to dividend equivalents. Such restricted
        stock units are considered participating securities. As such, we have included these restricted stock units in the calculation of basic
        earnings per share and calculate basic earnings per share using the two-class method. The two-class method of computing earnings
        per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating
        security according to dividends declared (or accumulated) and participation rights in undistributed earnings.
                     


Reconciliation of Non-GAAP Financial Measures –
 
Net Interest Income and Net Interest Margin (Tax-equivalent Basis)
 
 
 Three Months Ended Nine Months Ended
September 30,

 
(dollars in thousands)September
30,
2023
 June 30,
2023
 September
30,
2022
 2023 2022 
                     
Net interest income (tax-equivalent basis)                    
Net interest income$48,279  $48,872  $37,390  $143,988  $103,691  
Tax-equivalent adjustment (1) 675   715   674   2,092   1,801  
Net interest income (tax-equivalent basis) (1)$48,954  $49,587  $38,064  $146,080  $105,492  
                     
Net interest margin (tax-equivalent basis)                    
Net interest margin * 4.07%  4.16%  3.65%  4.14%  3.36% 
Tax-equivalent adjustment * (1) 0.06   0.06   0.07   0.06   0.05  
Net interest margin (tax-equivalent basis) * (1) 4.13%  4.22%  3.72%  4.20%  3.41% 
                     
Average interest-earning assets$4,708,331  $4,715,897  $4,059,978  $4,649,993  $4,131,221  
                     
*       Annualized measure.
(1)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.
                     


Reconciliation of Non-GAAP Financial Measures –
 
Efficiency Ratio (Tax-equivalent Basis)
 
 
 Three Months Ended Nine Months Ended
September 30,

 
(dollars in thousands)September
30,
2023
 June 30,
2023
 September
30,
2022
 2023 2022 
                     
Efficiency ratio (tax-equivalent basis)                    
Total noninterest expense$30,671  $33,973  $23,998  $100,577  $71,997  
Less: amortization of intangible assets 720   720   243   1,950   733  
Adjusted noninterest expense$29,951  $33,253  $23,755  $98,627  $71,264  
                     
Net interest income$48,279  $48,872  $37,390  $143,988  $103,691  
Total noninterest income 9,490   9,914   8,234   26,841   26,828  
Operating revenue 57,769   58,786   45,624   170,829   130,519  
Tax-equivalent adjustment (1) 675   715   674   2,092   1,801  
Operating revenue (tax-equivalent basis)
(1)
$58,444  $59,501  $46,298  $172,921  $132,320  
                     
Efficiency ratio 51.85%  56.57%  52.07%  57.73%  54.60% 
Efficiency ratio (tax-equivalent basis) (1) 51.25   55.89   51.31   57.04   53.86  
                     
(1)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.
                     


Reconciliation of Non-GAAP Financial Measures – 
Tangible Common Equity to Tangible Assets and Tangible Book Value Per Share 
       
(dollars in thousands, except per share data)September 30,
2023
 June 30, 2023 September 30,
2022

 
             
Tangible Common Equity            
Total stockholders' equity$456,251  $450,852  $359,073  
Less: Goodwill 59,820   59,876   29,322  
Less: Intangible assets, net 21,402   22,122   1,210  
Tangible common equity$375,029  $368,854  $328,541  
             
Tangible Assets            
Total assets$4,991,768  $4,975,810  $4,213,324  
Less: Goodwill 59,820   59,876   29,322  
Less: Intangible assets, net 21,402   22,122   1,210  
Tangible assets$4,910,546  $4,893,812  $4,182,792  
             
Total stockholders' equity to total assets 9.14%  9.06%  8.52% 
Tangible common equity to tangible assets 7.64   7.54   7.85  
             
Shares of common stock outstanding 31,774,140   31,865,868   28,752,626  
             
Book value per share$14.36  $14.15  $12.49  
Tangible book value per share 11.80   11.58   11.43  
             


Reconciliation of Non-GAAP Financial Measures –
 
Return on Average Tangible Common Equity,
 
Adjusted Return on Average Stockholders' Equity and Adjusted Return on Tangible Common Equity
 
 
 Three Months Ended Nine Months Ended
September 30,

 
(dollars in thousands)September
30,
2023
 June 30,
2023
 September
30,
2022
 2023 2022 
                     
Average Tangible Common Equity         
Total stockholders' equity$459,601  $454,505  $380,983  $445,576  $388,509  
Less: Goodwill 59,875   59,876   29,322   56,406   29,322  
Less: Intangible assets, net 21,793   22,520   1,356   20,005   1,597  
Average tangible common equity$377,933  $372,109  $350,305  $369,165  $357,590  
                     
Net income$19,715  $18,473  $15,627  $47,396  $43,316  
Adjusted net income 20,279   18,772   15,856   58,910   41,919