UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
(State or other jurisdiction | (Commission File Number) | (IRS Employer |
(Address of principal executive | (Zip Code) |
(
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). | |
Emerging growth company | |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | |
Item 2.02. Results of Operations and Financial Condition.
On April 26, 2023, HBT Financial, Inc. (the “Company”) issued a press release announcing its financial results for the first quarter ended March 31, 2023 (the “Earnings Release”). A copy of the Earnings Release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (this “Report”).
The information contained in Item 2.02, including Exhibit 99.1 furnished herewith, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that section, nor shall it be deemed incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or into any filing or other document pursuant to the Exchange Act, except to the extent required by applicable law or regulation.
Item 7.01. Regulation FD Disclosure.
The Company has prepared a presentation of its results for the first quarter ended March 31, 2023 (the “Presentation”) to be used from time to time during meetings with members of the investment community. A copy of the Presentation is furnished as Exhibit 99.2 to this Report. The Presentation will also be made available on the Company’s investor relations website at ir.hbtfinancial.com under the Presentations section.
The information contained in Item 7.01, including Exhibit 99.2 furnished herewith, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that section, nor shall it be deemed incorporated by reference into any registration statement or other document pursuant to the Securities Act, or into any filing or other document pursuant to the Exchange Act, except to the extent required by applicable law or regulation.
Item 8.01. Other Events.
On April 25, 2023, the Company’s Board of Directors declared a quarterly cash dividend of $0.17 per share on the Company’s common stock (the “Dividend”). The Dividend is payable on May 16, 2023 to shareholders of record as of May 9, 2023.
Item 9.01. Financial Statements and Exhibits.
Exhibit Number | Description of Exhibit |
99.1 | Earnings Release issued April 26, 2023 for the First Quarter Ended March 31, 2023. |
99.2 | HBT Financial, Inc. Presentation of Results for the First Quarter Ended March 31, 2023. |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
HBT FINANCIAL, INC. | ||
By: | /s/ Peter R. Chapman | |
Name: Peter R. Chapman | ||
Title: Chief Financial Officer | ||
Date: April 26, 2023 | ||
EXHIBIT 99.1
HBT FINANCIAL, INC. ANNOUNCES
FIRST QUARTER 2023 FINANCIAL RESULTS
First Quarter Highlights
| ● | Net income of $9.2 million, or $0.30 per diluted share; return on average assets (ROAA) of 0.78%; return on average stockholders' equity (ROAE) of 8.84%; and return on average tangible common equity (ROATCE)(1) of 10.45% |
| ● | Adjusted net income(1) of $19.9 million; or $0.64 per diluted share; adjusted ROAA(1) of 1.69%; adjusted ROAE(1) of 19.08%; and adjusted ROATCE(1) of 22.55% |
| ● | Completed merger with Town and Country Financial Corporation (“Town and Country”) on February 1, 2023 |
| ● | Asset quality remained strong with nonperforming assets to total assets of 0.20% |
| ● | Net interest margin expanded 10 basis points to 4.20% from the fourth quarter of 2022 |
(1) | See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures. |
Bloomington, IL, April 26, 2023 – 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 $9.2 million, or $0.30 diluted earnings per share, for the first quarter of 2023. This compares to net income of $13.1 million, or $0.46 diluted earnings per share, for the fourth quarter of 2022, and net income of $13.6 million, or $0.47 diluted earnings per share, for the first quarter of 2022.
Fred L. Drake, Chairman and Chief Executive Officer of HBT Financial, said, “It was a strong start to 2023 for HBT. We posted excellent financial results which were underpinned by two strengths that we have been focused on for many years. Asset quality remains strong with low levels of problem loans and net recoveries recorded during the quarter. In addition, our deposit base which is very granular and nearly 70% retail as of March 31, 2023 has remained stable in balances since December 31, 2022, and the increase in the cost of these deposits was in line with our expectations as our overall cost of funds increased only 19 basis points for the quarter. These strengths contributed to strong net income after adjusting for acquisition related expenses. In addition to our strong financial results, we completed a successful close of the Town and Country acquisition which is expected to provide profitable growth, scale and enhance the long-term value of our company. Finally, I am excited by the leadership changes we have recently announced, as I will transition to an Executive Chairman role and Lance Carter, who has been with the bank since 2001, will take over as Chief Executive Officer effective on May 24, 2023.”
HBT Financial, Inc.
Page 2 of 15
Adjusted Net Income
In addition to reporting GAAP results, the Company believes 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 $19.9 million, or $0.64 adjusted diluted earnings per share, for the first quarter of 2023. This compares to adjusted net income of $13.9 million, or $0.48 adjusted diluted earnings per share, for the fourth quarter of 2022, and adjusted net income of $12.2 million, or $0.42 adjusted diluted earnings per share, for the first quarter of 2022 (see "Reconciliation of Non-GAAP Financial Measures" tables).
Acquisition of Town and Country
On February 1, 2023, HBT Financial completed its previously announced acquisition of Town and Country, the holding company for Town and Country Bank. The acquisition further enhances HBT Financial’s footprint in Central Illinois and expands our footprint into metro-east St. Louis. After considering business combination accounting adjustments, Town and Country added total assets of $906 million, total loans held for investment of $635 million, and total deposits of $720 million.
Cash consideration of $38.0 million and stock consideration of approximately 3.4 million shares of HBT Financial common stock resulted in aggregate consideration of $109.4 million. The fair value of the shares of HBT Financial common stock issued as part of the consideration paid to the holders of Town and Country common stock was determined on the basis of the closing price of $21.12 per share on February 1, 2023. Goodwill of $30.6 million was recorded in the acquisition.
Acquisition-related expenses consisted of the following during the first quarter of 2023 and fourth quarter of 2022:
|
| Three Months Ended | ||||
|
| March 31, 2023 |
| December 31, 2022 | ||
| | (dollars in thousands) | ||||
Provision for credit losses | | $ | 5,924 | | $ | — |
Salaries | | | 3,518 | | | — |
Data processing | | | 1,855 | | | 304 |
Marketing and customer relations | | | 14 | | | — |
Legal fees and other noninterest expense | | | 1,753 | | | 326 |
Total acquisition-related expenses | | $ | 13,064 | | $ | 630 |
Net Interest Income and Net Interest Margin
Net interest income for the first quarter of 2023 was $46.8 million, an increase of 11.0% from $42.2 million for the fourth quarter of 2022. The increase was primarily attributable to the increase in earning assets following the Town and Country merger and higher yields on interest-earning assets. Partially offsetting these improvements were an increase in funding costs and a decrease in nonaccrual interest recoveries to $0.2 million during the first quarter of 2023 from $1.3 million during the fourth quarter of 2022.
Relative to the first quarter of 2022, net interest income increased 46.7% from $31.9 million. The increase was primarily attributable to higher yields on interest-earning assets and the increase in average interest-earning assets following the Town and Country merger.
Net interest margin for the first quarter of 2023 was 4.20%, compared to 4.10% for the fourth quarter of 2022. The increase was primarily attributable to higher yields on interest-earning assets and a more favorable mix of interest-earning assets, driven by the Town and Country merger and subsequent sale of the vast majority of the Town and Country securities portfolio, which was partially offset by higher funding costs. The contribution of nonaccrual interest recoveries to net interest margin was 2 basis points during the first quarter of 2023 and 13 basis points during the fourth quarter of 2022. Additionally, acquired loan discount accretion contributed 7 basis points to net interest margin during the first quarter of 2023 and 2 basis points during the fourth quarter of 2022.
HBT Financial, Inc.
Page 3 of 15
Relative to the first quarter of 2022, net interest margin increased from 3.08%. This increase was primarily attributable to higher yields on interest-earning assets. Nonaccrual interest recoveries contributed 7 basis points to net interest margin, and acquired loan discount accretion contributed 1 basis point to net interest margin, during the first quarter of 2022.
Noninterest Income
Noninterest income for the first quarter of 2023 was $7.4 million, a decrease of 5.7% from $7.9 million for the fourth quarter of 2022. The decrease was primarily attributable to realized losses on sales of securities of $1.0 million as the vast majority of the securities portfolio acquired from Town and Country was sold with the sale proceeds used to reduce Federal Home Loan Bank borrowings. Partially offsetting these losses was a $0.5 million increase in mortgage servicing revenue, primarily due to the addition of Town and Country servicing portfolio which nearly doubled the size of our existing mortgage servicing portfolio.
Relative to the first quarter of 2022, noninterest income decreased 25.9% from $10.0 million. The decline was primarily due to a negative $0.6 million mortgage servicing rights fair value adjustment during the first quarter of 2023 compared to a positive $1.7 million MSR fair value adjustment during the first quarter of 2022. Additionally, the realized losses on sales of securities of $1.0 million were partially offset by increases in mortgage servicing revenue and credit and debit card income.
Noninterest Expense
Noninterest expense for the first quarter of 2023 was $35.9 million, an 8.5% increase from $33.1 million for the fourth quarter of 2022. The increase was primarily due to acquisition-related expenses of $7.1 million and higher base costs following the Town and Country merger. These increases were mostly offset by the absence of accruals for pending legal matters totaling $8.2 million that were included in the fourth quarter of 2022 results.
Relative to the first quarter of 2022, noninterest expense increased 48.7% from $24.2 million, also primarily attributable to acquisition-related expenses.
Loan Portfolio
Total loans outstanding, before allowance for credit losses, were $3.20 billion at March 31, 2023, compared with $2.62 billion at December 31, 2022 and $2.49 billion at March 31, 2022. The $575.3 million increase in total loans from December 31, 2022 included $635.4 million of loans acquired in the Town and Country merger. Excluding the impact of the Town and Country merger, the $60.1 million decrease in total loans was primarily driven by a variety of balance reductions across the portfolio, including $21.9 million of multi-family loans refinanced to the secondary market and $14.9 million of payoffs on loans exited due to the current credit environment. Additionally, significantly lower seasonal usage on grain elevator lines of credit presented a headwind to loan growth during the first quarter of 2023.
Deposits
Total deposits were $4.31 billion at March 31, 2023, compared with $3.59 billion at December 31, 2022 and $3.82 billion at March 31, 2022. The $723.5 million increase from December 31, 2022 included $720.4 million of deposits assumed in the Town and Country merger. Excluding the impact of the Town and Country merger, total deposits remained nearly unchanged, with a $30.5 million increase in noninterest-bearing deposits and a $13.8 million increase in time deposits mostly offset by a $28.6 million decrease in money market accounts and a $16.3 million decrease in savings accounts.
HBT Financial, Inc.
Page 4 of 15
Adoption of CECL Methodology
On January 1, 2023, the Company adopted ASU 2016-13 (Topic 326), Measurement of Credit Losses on Financial Instruments, commonly referred to as the Current Expected Credit Loss (“CECL”) standard. Upon adoption of the CECL standard, a cumulative effect adjustment was recognized resulting in an after-tax decrease to retained earnings of $6.9 million as of January 1, 2023. This transition adjustment includes a $7.0 million impact due to the increase in the allowance for credit losses on loans, a $2.9 million impact due to the establishment of an allowance for credit losses on unfunded commitments, and a $2.7 million impact due to the tax effect of the transition adjustment.
Additionally, we also adopted the CECL standard using the prospective transition approach for purchased credit deteriorated (“PCD”) financial assets that were previously classified as purchased credit impaired (“PCI”) and accounted for under ASC 310-30. In accordance with the CECL standard, we did not reassess whether PCI assets met the criteria of PCD assets as of the date of adoption. On January 1, 2023, the amortized cost basis of the PCD assets were adjusted to reflect the addition of $0.2 million to the allowance for credit losses. The remaining noncredit discount will be accreted into interest income at the effective interest rate as of January 1, 2023.
Asset Quality
Nonperforming loans totaled $6.5 million, or 0.20% of total loans, at March 31, 2023, compared with $2.2 million, or 0.08% of total loans, at December 31, 2022, and $2.5 million, or 0.10% of total loans, at March 31, 2022. The $4.4 million increase in nonperforming loans from December 31, 2022 was primarily attributable to the Town and Country merger, which added $3.8 million in nonaccrual loans as of March 31, 2023, consisting primarily of one-to-four family residential real estate loans.
The Company recorded a provision for credit losses of $6.2 million for the first quarter of 2023 including the 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. The remaining provision for credit losses primarily reflects the establishment of an allowance for credit losses of $0.6 million on debt securities available-for-sale, related to one bank subordinated debt security, a $0.2 million decrease in specific reserves, and net recoveries of $0.1 million.
The Company had net recoveries of $0.1 million, or (0.02)% of average loans on an annualized basis, for the first quarter of 2023, compared to net recoveries of $0.9 million, or (0.14)% of average loans on an annualized basis, for the fourth quarter of 2022, and net recoveries of $1.2 million, or (0.19)% of average loans on an annualized basis, for the first quarter of 2022.
The Company’s allowance for credit losses was 1.21% of total loans and 595% of nonperforming loans at March 31, 2023, compared with 0.97% of total loans and 1,175% of nonperforming loans at December 31, 2022.
Stock Repurchase Program
During the first quarter of 2023, the Company repurchased 79,463 shares of its common stock at a weighted average price of $19.92 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 March 31, 2023, the Company had $13.4 million remaining under the current stock repurchase authorization.
HBT Financial, Inc.
Page 5 of 15
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 68 full-service branches. As of March 31, 2023, HBT had total assets of $5.0 billion, total loans of $3.2 billion, and total deposits of $4.3 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.
HBT Financial, Inc.
Page 6 of 15
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 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 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); (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
(888) 897-2276
HBT Financial, Inc.
Page 7 of 15
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
| | As of or for the Three Months Ended | | |||||||
| | March 31, | | December 31, | | March 31, | | |||
|
| 2023 |
| 2022 |
| 2022 |
| |||
| | (dollars in thousands, except per share data) | ||||||||
Interest and dividend income | | $ | 51,779 | | $ | 44,948 | | $ | 33,335 | |
Interest expense | | | 4,942 | | | 2,765 | | | 1,407 | |
Net interest income | | | 46,837 | | | 42,183 | | | 31,928 | |
Provision for credit losses | | | 6,210 | | | (653) | | | (584) | |
Net interest income after provision for credit losses | | | 40,627 | | | 42,836 | | | 32,512 | |
Noninterest income | | | 7,437 | | | 7,889 | | | 10,043 | |
Noninterest expense | | | 35,933 | | | 33,110 | | | 24,157 | |
Income before income tax expense | | | 12,131 | | | 17,615 | | | 18,398 | |
Income tax expense | | | 2,923 | | | 4,475 | | | 4,794 | |
Net income | | $ | 9,208 | | $ | 13,140 | | $ | 13,604 | |
| | | | | | | | | | |
Earnings per share - Basic | | $ | 0.30 | | $ | 0.46 | | $ | 0.47 | |
Earnings per share - Diluted | | | 0.30 | | | 0.46 | | | 0.47 | |
| | | | | | | | | | |
Adjusted net income (1) | | $ | 19,859 | | $ | 13,886 | | $ | 12,227 | |
Adjusted earnings per share - Basic (1) | | | 0.64 | | | 0.48 | | | 0.42 | |
Adjusted earnings per share - Diluted (1) | | | 0.64 | | | 0.48 | | | 0.42 | |
| | | | | | | | | | |
Book value per share | | $ | 14.02 | | $ | 12.99 | | $ | 13.23 | |
Tangible book value per share (1) | | | 11.45 | | | 11.94 | | | 12.16 | |
| | | | | | | | | | |
Shares of common stock outstanding | | | 32,095,370 | | | 28,752,626 | | | 28,967,943 | |
Weighted average shares of common stock outstanding | | | 30,977,204 | | | 28,752,626 | | | 28,986,593 | |
| | | | | | | | | | |
SUMMARY RATIOS | | | | | | | | | | |
Net interest margin * | | | 4.20 | % | | 4.10 | % | | 3.08 | % |
Net interest margin (tax equivalent basis) * (1)(2) | | | 4.26 | | | 4.17 | | | 3.13 | |
| | | | | | | | | | |
Efficiency ratio | | | 65.27 | % | | 65.85 | % | | 56.97 | % |
Efficiency ratio (tax equivalent basis) (1)(2) | | | 64.43 | | | 64.94 | | | 56.26 | |
| | | | | | | | | | |
Loan to deposit ratio | | | 74.13 | % | | 73.05 | % | | 65.19 | % |
| | | | | | | | | | |
Return on average assets * | | | 0.78 | % | | 1.23 | % | | 1.27 | % |
Return on average stockholders' equity * | | | 8.84 | | | 14.17 | | | 13.58 | |
Return on average tangible common equity * (1) | | | 10.45 | | | 15.45 | | | 14.71 | |
| | | | | | | | | | |
Adjusted return on average assets * (1) | | | 1.69 | % | | 1.30 | % | | 1.14 | % |
Adjusted return on average stockholders' equity * (1) | | | 19.08 | | | 14.98 | | | 12.20 | |
Adjusted return on average tangible common equity * (1) | | | 22.55 | | | 16.33 | | | 13.22 | |
| | | | | | | | | | |
CAPITAL | | | | | | | | | | |
Total capital to risk-weighted assets | | | 15.11 | % | | 16.27 | % | | 16.86 | % |
Tier 1 capital to risk-weighted assets | | | 13.16 | | | 14.23 | | | 14.66 | |
Common equity tier 1 capital ratio | | | 11.79 | | | 13.07 | | | 13.40 | |
Tier 1 leverage ratio | | | 10.29 | | | 10.48 | | | 9.83 | |
Total stockholders' equity to total assets | | | 8.98 | | | 8.72 | | | 8.81 | |
Tangible common equity to tangible assets (1) | | | 7.45 | | | 8.06 | | | 8.16 | |
| | | | | | | | | | |
ASSET QUALITY | | | | | | | | | | |
Net charge-offs (recoveries) to average loans, before allowance for credit losses | | | (0.02) | % | | (0.14) | % | | (0.19) | % |
Allowance for credit losses to loans, before allowance for credit losses | | | 1.21 | | | 0.97 | | | 0.99 | |
Nonperforming loans to loans, before allowance for credit losses | | | 0.20 | | | 0.08 | | | 0.10 | |
Nonperforming assets to total assets | | | 0.20 | | | 0.12 | | | 0.13 | |
* 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.
Page 8 of 15
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
Consolidated Statements of Income
| | Three Months Ended | |||||||
| | March 31, | | December 31, | | March 31, | |||
|
| 2023 |
| 2022 |
| 2022 | |||
INTEREST AND DIVIDEND INCOME | | (dollars in thousands, except per share data) | |||||||
Loans, including fees: | | | | | | | | | |
Taxable | | $ | 42,159 | | $ | 35,839 | | $ | 26,806 |
Federally tax exempt | | | 952 | | | 952 | | | 662 |
Securities: | | | | | | | | | |
Taxable | | | 6,616 | | | 6,421 | | | 4,649 |
Federally tax exempt | | | 1,197 | | | 1,184 | | | 1,040 |
Interest-bearing deposits in bank | | | 739 | | | 504 | | | 159 |
Other interest and dividend income | | | 116 | | | 48 | | | 19 |
Total interest and dividend income | | | 51,779 | | | 44,948 | | | 33,335 |
| | | | | | | | | |
INTEREST EXPENSE | | | | | | | | | |
Deposits | | | 2,374 | | | 849 | | | 569 |
Securities sold under agreements to repurchase | | | 38 | | | 10 | | | 9 |
Borrowings | | | 1,297 | | | 880 | | | 1 |
Subordinated notes | | | 470 | | | 470 | | | 470 |
Junior subordinated debentures issued to capital trusts | | | 763 | | | 556 | | | 358 |
Total interest expense | | | 4,942 | | | 2,765 | | | 1,407 |
Net interest income | | | 46,837 | | | 42,183 | | | 31,928 |
PROVISION FOR CREDIT LOSSES | | | 6,210 | | | (653) | | | (584) |
Net interest income after provision for credit losses | | | 40,627 | | | 42,836 | | | 32,512 |
| | | | | | | | | |
NONINTEREST INCOME | | | | | | | | | |
Card income | | | 2,658 | | | 2,642 | | | 2,404 |
Wealth management fees | | | 2,338 | | | 2,485 | | | 2,289 |
Service charges on deposit accounts | | | 1,871 | | | 1,701 | | | 1,652 |
Mortgage servicing | | | 1,099 | | | 593 | | | 658 |
Mortgage servicing rights fair value adjustment | | | (624) | | | (293) | | | 1,729 |
Gains on sale of mortgage loans | | | 276 | | | 194 | | | 587 |
Realized gains (losses) on sales of securities | | | (1,007) | | | — | | | — |
Unrealized gains (losses) on equity securities | | | (22) | | | 33 | | | (187) |
Gains (losses) on foreclosed assets | | | (10) | | | (122) | | | 40 |
Gains (losses) on other assets | | | — | | | 17 | | | 193 |
Income on bank owned life insurance | | | 115 | | | 42 | | | 40 |
Other noninterest income | | | 743 | | | 597 | | | 638 |
Total noninterest income | | | 7,437 | | | 7,889 | | | 10,043 |
| | | | | | | | | |
NONINTEREST EXPENSE | | | | | | | | | |
Salaries | | | 19,411 | | | 13,278 | | | 12,801 |
Employee benefits | | | 2,335 | | | 2,126 | | | 2,444 |
Occupancy of bank premises | | | 2,102 | | | 1,893 | | | 2,060 |
Furniture and equipment | | | 659 | | | 633 | | | 552 |
Data processing | | | 4,323 | | | 2,167 | | | 1,653 |
Marketing and customer relations | | | 836 | | | 867 | | | 851 |
Amortization of intangible assets | | | 510 | | | 140 | | | 245 |
FDIC insurance | | | 563 | | | 276 | | | 288 |
Loan collection and servicing | | | 278 | | | 278 | | | 157 |
Foreclosed assets | | | 61 | | | 33 | | | 132 |
Other noninterest expense | | | 4,855 | | | 11,419 | | | 2,974 |
Total noninterest expense | | | 35,933 | | | 33,110 | | | 24,157 |
INCOME BEFORE INCOME TAX EXPENSE | | | 12,131 | | | 17,615 | | | 18,398 |
INCOME TAX EXPENSE | | | 2,923 | | | 4,475 | | | 4,794 |
NET INCOME | | $ | 9,208 | | $ | 13,140 | | $ | 13,604 |
| | | | | | | | | |
EARNINGS PER SHARE - BASIC | | $ | 0.30 | | $ | 0.46 | | $ | 0.47 |
EARNINGS PER SHARE - DILUTED | | $ | 0.30 | | $ | 0.46 | | $ | 0.47 |
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING | | | 30,977,204 | | | 28,752,626 | | | 28,986,593 |
HBT Financial, Inc.
Page 9 of 15
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
Consolidated Balance Sheets
|
| March 31, | | December 31, |
| March 31, | |||
|
| 2023 |
| 2022 |
| 2022 | |||
| | (dollars in thousands) | |||||||
ASSETS | | | | | | | | | |
Cash and due from banks | | $ | 35,244 | | $ | 18,970 | | $ | 30,761 |
Interest-bearing deposits with banks | | | 141,868 | | | 95,189 | | | 328,218 |
Cash and cash equivalents | | | 177,112 | | | 114,159 | | | 358,979 |
| | | | | | | | | |
Interest-bearing time deposits with banks | | | 249 | | | — | | | 487 |
Debt securities available-for-sale, at fair value | | | 854,622 | | | 843,524 | | | 933,922 |
Debt securities held-to-maturity | | | 536,429 | | | 541,600 | | | 438,054 |
Equity securities with readily determinable fair value | | | 3,145 | | | 3,029 | | | 3,256 |
Equity securities with no readily determinable fair value | | | 1,980 | | | 1,977 | | | 1,927 |
Restricted stock, at cost | | | 4,991 | | | 7,965 | | | 2,739 |
Loans held for sale | | | 5,130 | | | 615 | | | 1,777 |
| | | | | | | | | |
Loans, before allowance for credit losses | | | 3,195,540 | | | 2,620,253 | | | 2,487,785 |
Allowance for credit losses | | | (38,776) | | | (25,333) | | | (24,508) |
Loans, net of allowance for credit losses | | | 3,156,764 | | | 2,594,920 | | | 2,463,277 |
| | | | | | | | | |
Bank owned life insurance | | | 23,447 | | | 7,557 | | | 7,433 |
Bank premises and equipment, net | | | 65,119 | | | 50,469 | | | 52,005 |
Bank premises held for sale | | | 235 | | | 235 | | | 1,081 |
Foreclosed assets | | | 3,356 | | | 3,030 | | | 3,043 |
Goodwill | | | 59,876 | | | 29,322 | | | 29,322 |
Intangible assets, net | | | 22,842 | | | 1,070 | | | 1,698 |
Mortgage servicing rights, at fair value | | | 19,992 | | | 10,147 | | | 9,723 |
Investments in unconsolidated subsidiaries | | | 1,614 | | | 1,165 | | | 1,165 |
Accrued interest receivable | | | 20,301 | | | 19,506 | | | 13,527 |
Other assets | | | 56,617 | | | 56,444 | | | 25,550 |
Total assets | | $ | 5,013,821 | | $ | 4,286,734 | | $ | 4,348,965 |
| | | | | | | | | |
LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | | | | |
Liabilities | | | | | | | | | |
Deposits: | | | | | | | | | |
Noninterest-bearing | | $ | 1,218,888 | | $ | 994,954 | | $ | 1,069,231 |
Interest-bearing | | | 3,091,633 | | | 2,592,070 | | | 2,746,838 |
Total deposits | | | 4,310,521 | | | 3,587,024 | | | 3,816,069 |
| | | | | | | | | |
Securities sold under agreements to repurchase | | | 34,919 | | | 43,081 | | | 50,834 |
Federal Home Loan Bank advances | | | 75,183 | | | 160,000 | | | — |
Subordinated notes | | | 39,415 | | | 39,395 | | | 39,336 |
Junior subordinated debentures issued to capital trusts | | | 52,746 | | | 37,780 | | | 37,731 |
Other liabilities | | | 50,939 | | | 45,822 | | | 21,840 |
Total liabilities | | | 4,563,723 | | | 3,913,102 | | | 3,965,810 |
| | | | | | | | | |
Stockholders' Equity | | | | | | | | | |
Common stock | | | 327 | | | 293 | | | 293 |
Surplus | | | 294,441 | | | 222,783 | | | 221,735 |
Retained earnings | | | 228,782 | | | 232,004 | | | 203,076 |
Accumulated other comprehensive income (loss) | | | (62,175) | | | (71,759) | | | (36,100) |
Treasury stock at cost | | | (11,277) | | | (9,689) | | | (5,849) |
Total stockholders’ equity | | | 450,098 | | | 373,632 | | | 383,155 |
Total liabilities and stockholders’ equity | | $ | 5,013,821 | | $ | 4,286,734 | | $ | 4,348,965 |
| | | | | | | | | |
SHARE INFORMATION | | | | | | | | | |
Shares of common stock outstanding | | | 32,095,370 | | | 28,752,626 | | | 28,967,943 |
HBT Financial, Inc.
Page 10 of 15
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
|
| March 31, | | December 31, |
| March 31, | |||
|
| 2023 |
| 2022 |
| 2022 | |||
| | (dollars in thousands) | |||||||
LOANS | | | | | | | | | |
Commercial and industrial | | $ | 333,013 | | $ | 266,757 | | $ | 291,909 |
Commercial real estate - owner occupied | | | 317,103 | | | 218,503 | | | 237,000 |
Commercial real estate - non-owner occupied | | | 854,024 | | | 713,202 | | | 687,617 |
Construction and land development | | | 389,142 | | | 360,824 | | | 320,030 |
Multi-family | | | 362,672 | | | 287,865 | | | 243,447 |
One-to-four family residential | | | 482,732 | | | 338,253 | | | 327,791 |
Agricultural and farmland | | | 243,357 | | | 237,746 | | | 232,528 |
Municipal, consumer, and other | | | 213,497 | | | 197,103 | | | 147,463 |
Loans, before allowance for credit losses | | $ | 3,195,540 | | $ | 2,620,253 | | $ | 2,487,785 |
| | | | | | | | | |
PPP LOANS (included above) | | | | | | | | | |
Commercial and industrial | | $ | 25 | | $ | 28 | | $ | 16,184 |
Agricultural and farmland | | | — | | | — | | | 392 |
Total PPP Loans | | $ | 25 | | $ | 28 | | $ | 16,576 |
| | March 31, | | December 31, |
| March 31, | |||
|
| 2023 |
| 2022 |
| 2022 | |||
| | (dollars in thousands) | |||||||
DEPOSITS | | | | | | | | | |
Noninterest-bearing | | $ | 1,218,888 | | $ | 994,954 | | $ | 1,069,231 |
Interest-bearing demand | | | 1,270,454 | | | 1,139,150 | | | 1,167,058 |
Money market | | | 662,088 | | | 555,425 | | | 597,464 |
Savings | | | 738,719 | | | 634,527 | | | 687,147 |
Time | | | 420,372 | | | 262,968 | | | 295,169 |
Total deposits | | $ | 4,310,521 | | $ | 3,587,024 | | $ | 3,816,069 |
HBT Financial, Inc.
Page 11 of 15
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
| | Three Months Ended |
| ||||||||||||||||||||||
|
| March 31, 2023 |
| December 31, 2022 |
| March 31, 2022 | | ||||||||||||||||||
|
| Average |
| | |
| |
| Average |
| | |
| |
| Average |
| | |
| | | |||
|
| Balance | | Interest |
| Yield/Cost * |
| Balance | | Interest |
| Yield/Cost * |
| Balance | | Interest |
| Yield/Cost * | | ||||||
|
| (dollars in thousands) | | ||||||||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans | | $ | 3,012,320 | | $ | 43,111 |
| 5.80 | % | $ | 2,600,746 | | $ | 36,791 |
| 5.61 | % | $ | 2,507,006 | | $ | 27,468 |
| 4.44 | % |
Securities | |
| 1,411,613 | |
| 7,813 |
| 2.24 | |
| 1,396,401 | | | 7,605 |
| 2.16 | |
| 1,321,918 | |
| 5,689 |
| 1.75 | |
Deposits with banks | |
| 92,363 | |
| 739 |
| 3.24 | |
| 76,507 | | | 504 |
| 2.61 | |
| 370,130 | |
| 159 |
| 0.17 | |
Other | |
| 7,425 | |
| 116 |
| 6.33 | |
| 5,607 | | | 48 |
| 3.37 | |
| 2,739 | |
| 19 |
| 2.80 | |
Total interest-earning assets | |
| 4,523,721 | | $ | 51,779 |
| 4.64 | % |
| 4,079,261 | | $ | 44,948 |
| 4.37 | % |
| 4,201,793 | | $ | 33,335 |
| 3.22 | % |
Allowance for credit losses | |
| (33,301) | | | | | | |
| (25,404) | | | | | | |
| (24,099) | | | | | | |
Noninterest-earning assets | |
| 274,870 | | | | | | |
| 188,942 | | | | | | |
| 165,752 | | | | | | |
Total assets | | $ | 4,765,290 | | | | | | | $ | 4,242,799 | | | | | | | $ | 4,343,446 | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | | | | | | | | | | | | | | | | | | | | |
Liabilities | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing deposits: | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing demand | | $ | 1,230,644 | | $ | 458 |
| 0.15 | % | $ | 1,125,877 | | $ | 177 |
| 0.06 | % | $ | 1,143,829 | | $ | 142 |
| 0.05 | % |
Money market | |
| 634,608 | |
| 935 |
| 0.60 | |
| 572,718 | |
| 379 |
| 0.26 | |
| 598,271 | |
| 121 |
| 0.08 | |
Savings | |
| 709,862 | |
| 178 |
| 0.10 | |
| 640,668 | |
| 53 |
| 0.03 | |
| 649,563 | |
| 50 |
| 0.03 | |
Time | |
| 356,779 | |
| 803 |
| 0.91 | |
| 266,117 | |
| 240 |
| 0.36 | |
| 310,675 | |
| 256 |
| 0.33 | |
Total interest-bearing deposits | |
| 2,931,893 | |
| 2,374 |
| 0.33 | |
| 2,605,380 | |
| 849 |
| 0.13 | |
| 2,702,338 | |
| 569 |
| 0.09 | |
Securities sold under agreements to repurchase | |
| 39,619 | |
| 38 |
| 0.38 | |
| 51,703 | | | 10 |
| 0.08 | |
| 53,054 | |
| 9 |
| 0.07 | |
Borrowings | |
| 113,896 | |
| 1,297 |
| 4.62 | |
| 92,120 | | | 880 |
| 3.79 | |
| 500 | |
| 1 |
| 0.71 | |
Subordinated notes | | | 39,403 | | | 470 | | 4.83 | | | 39,384 | | | 470 | | 4.73 | | | 39,325 | | | 470 | | 4.84 | |
Junior subordinated debentures issued to capital trusts | |
| 47,586 | |
| 763 |
| 6.50 | |
| 37,770 | | | 556 |
| 5.84 | |
| 37,721 | |
| 358 |
| 3.85 | |
Total interest-bearing liabilities | |
| 3,172,397 | | $ | 4,942 |
| 0.63 | % |
| 2,826,357 | | $ | 2,765 |
| 0.39 | % |
| 2,832,938 | | $ | 1,407 |
| 0.20 | % |
Noninterest-bearing deposits | |
| 1,121,365 | | | |
|
| |
| 1,023,355 | |
|
|
|
| |
| 1,077,917 | |
|
|
|
| |
Noninterest-bearing liabilities | |
| 49,316 | | | |
|
| |
| 25,220 | |
|
|
|
| |
| 26,302 | |
|
|
|
| |
Total liabilities | |
| 4,343,078 | | | |
|
| |
| 3,874,932 | |
|
|
|
| |
| 3,937,157 | |
|
|
|
| |
Stockholders' Equity | |
| 422,212 | | | |
|
| |
| 367,867 | |
|
|
|
| |
| 406,289 | |
|
|
|
| |
Total liabilities and stockholders’ equity | | $ | 4,765,290 | | | |
|
| | $ | 4,242,799 | |
|
|
|
| | $ | 4,343,446 | |
|
|
|
| |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Net interest income/Net interest margin (1) | | | | | $ | 46,837 | | 4.20 | % | | | | $ | 42,183 |
| 4.10 | % | | | | $ | 31,928 |
| 3.08 | % |
Tax-equivalent adjustment (2) | | | | |
| ||||||||||||||||||||