DALLAS, April 20, 2020 (GLOBE NEWSWIRE) -- Triumph Bancorp, Inc. (Nasdaq: TBK) (“Triumph” or the “Company”) today announced earnings and operating results for the first quarter of 2020.

As part of how we measure our results, we use certain non-GAAP financial measures to ascertain performance.  These non-GAAP financial measures are reconciled in the section labeled “Metrics and non-GAAP financial reconciliation” at the end of this press release.

2020 First Quarter Highlights and Recent Developments

  • For the first quarter of 2020, net loss available to common stockholders was $4.5 million. Diluted losses per share were $0.18. 

  • On January 1, 2020, we adopted Accounting Standard Update 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” commonly referred to as the Current Expected Credit Losses (“CECL”) model.

  • For the quarter ended March 31, 2020, we recorded $20.3 million of total credit loss expense. $17.4 million  of this is recorded as credit loss expense related to our loan portfolio summarized as follows:

    • Significant deterioration in our macroeconomic forecasts to reflect expected economic impact of COVID-19 resulted in approximately $10.5 million of credit loss expense.

    • $3.0 million of credit loss expense is due to net loan growth of $126.0 million and changes in the mix of our total loan portfolio. Net charge offs were $1.5 million and the change in specific reserves was $2.3 million.

    • The adoption of CECL on January 1, 2020, increased the ACL by $0.3 million.

    • Our ACL as a percentage of loans held for investment increased 34 basis points during the quarter to 1.04% at March 31, 2020.

  • For the quarter ended March 31, 2020, we recorded in other noninterest expense $2.9 million of credit loss expense related to off balance sheet commitments to lend to reserve for the contractual term of the commitments considering our economic forecast of future conditions. Total unfunded commitments subject to the reserve as of March 31, 2020 were $596.1 million. This includes a $105.3 million increase in unsettled liquid credit balances at the end of the period that created approximately $1.6 million of credit expense for the quarter.

  • Net interest margin (“NIM”) was 5.63% for the quarter ended March 31, 2020. 

  • Total loans held for investment increased $126.0 million, or 3.0%, to $4.321 billion at March 31, 2020. Excluding premium finance loans, loan growth totaled $227.1 million. Average loans for the quarter decreased $88.6 million, or 2.1%, to $4.046 billion.

  • The total dollar value of invoices purchased by Triumph Business Capital for the quarter ended March 31, 2020 was $1.451 billion with an average invoice size of $1,651. The transportation average invoice size for the quarter was $1,481.

  • For the quarter ended March 31, 2020, TriumphPay processed 504,250 invoices paying 44,568 distinct carriers a total of $530.8 million.

  • During the quarter ended March 31, 2020, we repurchased 871,319 shares into treasury stock under our stock repurchase program at an average price of $40.81, for a total of $35.6 million, effectively completing the $50.0 million stock repurchase program authorized by our board of directors on October 16, 2019.

  • On April 20, 2020, the Company entered into an agreement to sell the assets (the “Disposal Group”) of Triumph Premium Finance (“TPF”) and exit its premium finance line of business. The decision to sell TPF was made during the three months ended March 31, 2020, and at March 31, 2020, the carrying amount of the Disposal Group, primarily consisting of $98.3 million of premium finance loans, was transferred to assets held for sale.

Balance Sheet

Total loans held for investment increased $126.0 million, or 3.0%, during the first quarter to $4.321 billion at March 31, 2020. The commercial finance portfolio increased $135.1 million, or 10.8%, to $1.386 billion, the national lending portfolio increased $61.2 million, or 7.2%, to $911.6 million, and the community banking portfolio decreased $70.3 million, or 3.4%, to $2.023 billion during the quarter.

Total deposits were $3.682 billion at March 31, 2020, a decrease of $107.9 million, or 2.8%, in the first quarter of 2020.  Non-interest-bearing deposits accounted for 23% of total deposits and non-time deposits accounted for 60% of total deposits at March 31, 2020. 

Net Interest Income

We earned net interest income for the quarter ended March 31, 2020 of $62.5 million compared to $66.4 million for the quarter ended December 31, 2019.

Yields on loans for the quarter ended March 31, 2020 were down 26 bps from the prior quarter to 7.22%. The average cost of our total deposits was 1.05% for the quarter ended March 31, 2020 compared to 1.15% for the quarter ended December 31, 2019. 

Asset Quality

Non-performing assets were 1.09% of total assets at March 31, 2020 compared to 0.87% of total assets at December 31, 2019.  The ratio of past due to total loans increased to 1.99% at March 31, 2020 from 1.74% at December 31, 2019. We recorded total net charge-offs of $1.5 million, or 0.04% of average loans, for the quarter ended March 31, 2020 compared to net charge-offs of $3.2 million, or 0.08% of average loans, for the quarter ended December 31, 2019. 

Non-Interest Income and Expense

We earned non-interest income for the quarter ended March 31, 2020 of $7.5 million compared to $8.7 million for the quarter ended December 31, 2019.

For the quarter ended March 31, 2020, non-interest expense totaled $57.7 million, which included $2.9 million of credit loss expense for off balance sheet commitments to lend. Credit loss expense for off balance sheet commitments to lend had a 420 basis point impact on our efficiency ratio this quarter. Non-interest expense for the quarter ended December 31, 2019 was $52.7 million.

Conference Call Information

Aaron P. Graft, Vice Chairman and CEO and Bryce Fowler, CFO will review the quarterly results in a conference call for investors and analysts beginning at 7:00 a.m. Central Time on Tuesday, April 21, 2020. Todd Ritterbusch, Chief Lending Officer, will also be available for questions.

To participate in the live conference call, please dial 1-855-940-9472 (Canada: 1-855-669-9657) and request to be joined into the Triumph Bancorp, Inc. call.  A simultaneous audio-only webcast may be accessed via the Company's website at www.triumphbancorp.com through the Investor Relations, News & Events, Webcasts and Presentations links, or through a direct link here at: https://services.choruscall.com/links/tbk200421.html. An archive of this conference call will subsequently be available at this same location on the Company’s website.  

About Triumph

Triumph Bancorp, Inc. (Nasdaq: TBK) is a financial holding company headquartered in Dallas, Texas.  Triumph offers a diversified line of community banking, national lending, and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com

Forward-Looking Statements

This press release contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; the impact of COVID-19 on our business, including the impact of the actions taken by governmental authorities to try and contain the virus or address the impact of the virus on the United States economy (including, without limitation, the CARES Act), and the resulting effect of all of such items on our operations, liquidity and capital position, and on the financial condition of our borrowers and other customers; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; changes in management personnel; interest rate risk; concentration of our products and services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; risks related to the integration of acquired businesses and any future acquisitions; our ability to successfully identify and address the risks associated with our possible future acquisitions, and the risks that our prior and possible future acquisitions make it more difficult for investors to evaluate our business, financial condition and results of operations, and impairs our ability to accurately forecast our future performance; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of FDIC, insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 11, 2020.

Non-GAAP Financial Measures

This press release includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided at the end of this press release.

The following table sets forth key metrics used by Triumph to monitor our operations. Footnotes in this table can be found in our definitions of non-GAAP financial measures at the end of this document.

  As of and for the Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
(Dollars in thousands) 2020  2019  2019  2019  2019 
Financial Highlights:                    
Total assets $5,353,729  $5,060,297  $5,039,697  $4,783,189  $4,529,783 
Loans held for investment $4,320,548  $4,194,512  $4,209,417  $3,835,903  $3,612,869 
Deposits $3,682,015  $3,789,906  $3,697,833  $3,658,978  $3,314,440 
Net income available to common stockholders $(4,450) $16,709  $14,317  $12,730  $14,788 
                     
Performance Ratios - Annualized:                    
Return on average assets  (0.36%)  1.31%  1.17%  1.09%  1.33%
Return on average total equity  (2.85%)  10.24%  8.79%  7.83%  9.30%
Return on average tangible common equity (1)  (4.09%)  14.54%  12.56%  11.19%  13.43%
Yield on loans(2)  7.22%  7.48%  7.63%  7.95%  7.99%
Cost of interest bearing deposits  1.34%  1.45%  1.49%  1.42%  1.24%
Cost of total deposits  1.05%  1.15%  1.19%  1.14%  0.99%
Cost of total funds  1.23%  1.35%  1.41%  1.40%  1.28%
Net interest margin(2)  5.63%  5.72%  5.85%  5.99%  6.15%
Net non-interest expense to average assets  4.12%  3.46%  3.64%  3.68%  3.70%
Efficiency ratio  82.44%  70.15%  71.93%  71.37%  70.54%
                     
Asset Quality:(3)                    
Past due to total loans(4)  1.99%  1.74%  1.91%  1.60%  2.17%
Non-performing loans to total loans  1.26%  0.97%  1.00%  0.96%  0.95%
Non-performing assets to total assets  1.09%  0.87%  0.91%  0.86%  0.84%
ACL to non-performing loans(5)  82.37%  71.63%  75.58%  79.91%  80.70%
ACL to total loans(5)  1.04%  0.69%  0.76%  0.77%  0.76%
Net charge-offs to average loans  0.04%  0.08%  0.01%  0.05%  0.03%
                     
Capital:                    
Tier 1 capital to average assets(6)  9.62%  10.03%  10.37%  10.84%  11.32%
Tier 1 capital to risk-weighted assets(6)  9.03%  10.29%  10.08%  11.08%  11.76%
Common equity tier 1 capital to risk-weighted assets(6)  8.24%  9.46%  9.26%  10.19%  10.81%
Total capital to risk-weighted assets(5)  11.63%  12.76%  11.79%  12.88%  13.62%
Total equity to total assets  11.01%  12.58%  12.57%  13.45%  14.27%
Tangible common stockholders' equity to tangible assets(1)  7.77%  9.16%  9.10%  9.78%  10.37%
                     
Per Share Amounts:                    
Book value per share $24.45  $25.50  $24.99  $24.56  $24.19 
Tangible book value per share (1) $16.64  $17.88  $17.40  $17.13  $16.82 
Basic earnings (loss) per common share $(0.18) $0.67  $0.56  $0.48  $0.55 
Diluted earnings (loss) per common share $(0.18) $0.66  $0.56  $0.48  $0.55 
Shares outstanding end of period  24,101,120   24,964,961   25,357,985   26,198,308   26,709,411 


Unaudited consolidated balance sheet as of:

  March 31,  December 31,  September 30,  June 30,  March 31, 
 (Dollars in thousands) 2020  2019  2019  2019  2019 
ASSETS                    
Total cash and cash equivalents $208,414  $197,880  $115,043  $209,305  $171,950 
Securities - available for sale  302,122   248,820   302,917   329,991   339,465 
Securities - held to maturity  8,217   8,417   8,517   8,573   8,499 
Equity securities  5,678   5,437   5,543   5,479   5,183 
Loans held for sale  4,431   2,735   7,499   2,877   610 
Loans held for investment  4,320,548   4,194,512   4,209,417   3,835,903   3,612,869 
Allowance for credit losses  (44,732)  (29,092)  (31,895)  (29,416)  (27,605)
Loans, net  4,275,816   4,165,420   4,177,522   3,806,487   3,585,264 
Assets held for sale  97,895             
FHLB and other restricted stock  37,080   19,860   23,960   18,037   21,191 
Premises and equipment, net  98,363   96,595   87,112   84,998   84,931 
Other real estate owned ("OREO"), net  2,540   3,009   2,849   3,351   3,073 
Goodwill and intangible assets, net  188,208   190,286   192,440   194,668   197,015 
Bank-owned life insurance  41,122   40,954   40,724   40,847   40,667 
Deferred tax asset, net  9,457   3,812   5,971   7,278   7,608 
Other assets  74,386   77,072   69,600   71,298   64,327 
Total assets $5,353,729  $5,060,297  $5,039,697  $4,783,189  $4,529,783 
LIABILITIES                    
Non-interest bearing deposits $846,412  $809,696  $754,233  $684,223  $667,597 
Interest bearing deposits  2,835,603   2,980,210   2,943,600   2,974,755   2,646,843 
Total deposits  3,682,015   3,789,906   3,697,833   3,658,978   3,314,440 
Customer repurchase agreements  3,693   2,033   14,124   12,788   3,727 
Federal Home Loan Bank advances  850,000   430,000   530,000   305,000   405,000 
Subordinated notes  87,347   87,327   49,010   48,983   48,956 
Junior subordinated debentures  39,689   39,566   39,443   39,320   39,200 
Other liabilities  101,638   74,875   75,594   74,758   72,244 
Total liabilities  4,764,382   4,423,707   4,406,004   4,139,827   3,883,567 
EQUITY                    
Common stock  272   272   272   271   271 
Additional paid-in-capital  474,441   473,251   472,368   471,145   470,292 
Treasury stock, at cost  (102,677)  (67,069)  (52,632)  (27,468)  (9,881)
Retained earnings  222,809   229,030   212,321   198,004   185,274 
Accumulated other comprehensive income (loss)  (5,498)  1,106   1,364   1,410   260 
Total stockholders' equity  589,347   636,590   633,693   643,362   646,216 
Total liabilities and equity $5,353,729  $5,060,297  $5,039,697  $4,783,189  $4,529,783 


Unaudited consolidated statement of income:

  For the Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
 (Dollars in thousands) 2020  2019  2019  2019  2019 
Interest income:                    
Loans, including fees $48,323  $52,395  $50,249  $47,910  $45,094 
Factored receivables, including fees  24,292   25,573   25,570   25,558   24,556 
Securities  2,107   2,379   2,784   2,667   2,644 
FHLB and other restricted stock  204   165   209   146   192 
Cash deposits  488   659   603   1,022   778 
Total interest income  75,414   81,171   79,415   77,303   73,264 
Interest expense:                    
Deposits  9,677   10,961   11,036   10,010   8,218 
Subordinated notes  1,347   1,035   840   839   839 
Junior subordinated debentures  646   687   719   744   760 
Other borrowings  1,244   2,080   2,055   2,291   2,136 
Total interest expense  12,914   14,763   14,650   13,884   11,953 
Net interest income  62,500   66,408   64,765   63,419   61,311 
Credit loss expense  17,361   382   2,865   3,681   1,014 
Net interest income after credit loss expense  45,139   66,026   61,900   59,738   60,297 
Non-interest income:                    
Service charges on deposits  1,588   1,889   1,937   1,700   1,606 
Card income  1,800   1,943   2,015   2,071   1,844 
Net OREO gains (losses) and valuation adjustments  (257)  50   (56)  148   209 
Net gains (losses) on sale of securities  38   39   19   14   (11)
Fee income  1,686   1,686   1,624   1,519   1,612 
Insurance commissions  1,051   1,092   1,247   961   919 
Other  1,571   1,967   956   1,210   1,359 
Total non-interest income  7,477   8,666   7,742   7,623   7,538 
Non-interest expense:                    
Salaries and employee benefits  30,722   29,586   28,717   28,120   26,439 
Occupancy, furniture and equipment  5,182   4,667   4,505   4,502   4,522 
FDIC insurance and other regulatory assessments  315   (302)  (2)  303   299 
Professional fees  2,107   1,904   1,969   1,550   1,865 
Amortization of intangible assets  2,078   2,154   2,228   2,347   2,402 
Advertising and promotion  1,292   1,347   1,379   1,796   1,604 
Communications and technology  5,501   5,732   5,382   4,988   4,874 
Other  10,493   7,573   7,975   7,098   6,561 
Total non-interest expense  57,690   52,661   52,153   50,704   48,566 
Net income (loss) before income tax  (5,074)  22,031   17,489   16,657   19,269 
Income tax expense (benefit)  (624)  5,322   3,172   3,927   4,481 
Net income (loss) $(4,450) $16,709  $14,317  $12,730  $14,788 


Earnings per share:

  For the Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
(Dollars in thousands) 2020  2019  2019  2019  2019 
Basic                    
Net income (loss) to common stockholders $(4,450) $16,709  $14,317  $12,730  $14,788 
Weighted average common shares outstanding  24,314,329   25,089,447   25,621,054   26,396,351   26,679,724 
Basic earnings (loss) per common share $(0.18) $0.67  $0.56  $0.48  $0.55 
                     
Diluted                    
Net income (loss) to common stockholders - diluted $(4,450) $16,709  $14,317  $12,730  $14,788 
Weighted average common shares outstanding  24,314,329   25,089,447   25,621,054   26,396,351   26,679,724 
Dilutive effects of:                    
Assumed exercises of stock options     69,865   60,068   59,962   64,166 
Restricted stock awards     70,483   45,631   30,110   49,795 
Restricted stock units     13,264   3,045       
Performance stock units - market based     11,803   4,673       
Performance stock units - performance based               
Weighted average shares outstanding - diluted  24,314,329   25,254,862   25,734,471   26,486,423   26,793,685 
Diluted earnings (loss) per common share $(0.18) $0.66  $0.56  $0.48  $0.55 
                     
Shares that were not considered in computing diluted earnings per common share because they were antidilutive are as follows: 
                     
  For the Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
  2020  2019  2019  2019  2019 
Stock options  225,055   66,019   67,023   70,037   50,752 
Restricted stock awards  147,748      3,209      13,290 
Restricted stock units  55,228         58,400   58,400 
Performance stock units - market based  67,707   55,228   55,228   70,879   58,400 
Performance stock units - performance based  254,000   254,000          


Loans held for investment summarized as of:

  March 31,  December 31,  September 30,  June 30,  March 31, 
 (Dollars in thousands) 2020  2019  2019  2019  2019 
Commercial real estate $985,757  $1,046,961  $1,115,559  $1,098,279  $1,093,882 
Construction, land development, land  198,050   160,569   164,186   157,861   145,002 
1-4 family residential properties  169,703   179,425   186,405   186,070   194,067 
Farmland  133,579   154,975   161,447   144,594   156,299 
Commercial  1,412,822   1,342,683   1,369,505   1,257,330   1,117,640 
Factored receivables  661,100   619,986   599,651   583,131   570,663 
Consumer  20,326   21,925   24,967   26,048   27,941 
Mortgage warehouse  739,211   667,988   587,697   382,590   307,375 
  Total loans $4,320,548  $4,194,512  $4,209,417  $3,835,903  $3,612,869 

Our total loans held for investment portfolio consists of traditional community bank loans as well as commercial finance product lines focused on businesses that require specialized financial solutions and national lending product lines that further diversify our lending operations.

Commercial finance loans are further summarized below:

  March 31,  December 31,  September 30,  June 30,  March 31, 
(Dollars in thousands) 2020  2019  2019  2019  2019 
Commercial - Equipment $479,483  $461,555  $429,412  $395,094  $364,447 
Commercial - Asset-based lending  245,001   168,955   247,026   208,896   174,447 
Factored receivables  661,100   619,986   599,651   583,131   570,663 
  Commercial finance $1,385,584  $1,250,496  $1,276,089  $1,187,121  $1,109,557 
                     
Commercial finance % of total loans  32%  30%  30%  31%  31%

National lending loans are further summarized below:

  March 31,  December 31,  September 30,  June 30,  March 31, 
(Dollars in thousands) 2020  2019  2019  2019  2019 
Mortgage warehouse $739,211  $667,988  $587,697  $382,590  $307,375 
Commercial - Liquid credit  172,380   81,353   37,386   21,758   960 
Commercial - Premium finance     101,015   101,562   72,898   77,389 
National lending $911,591  $850,356  $726,645  $477,246  $385,724 
                     
National lending % of total loans  21%  20%  17%  12%  11%

Additional information pertaining to our loan portfolio, summarized for the quarters ended:

  March 31,  December 31,  September 30,  June 30,  March 31, 
(Dollars in thousands) 2020  2019  2019  2019  2019 
Average community banking $2,041,256  $2,170,149  $2,193,533  $2,166,122  $2,103,816 
Average commercial finance  1,292,749   1,260,000   1,208,823   1,168,110   1,123,978 
Average national lending  711,837   704,244   541,367   373,755   307,249 
Average total loans $4,045,842  $4,134,393  $3,943,723  $3,707,987  $3,535,043 
Community banking yield  5.67%  5.89%  5.79%  5.88%  5.91%
Commercial finance yield  11.00%  11.64%  12.31%  12.52%  12.50%
National lending yield  4.80%  4.96%  4.63%  5.62%  5.73%
Total loan yield  7.22%  7.48%  7.63%  7.95%  7.99%

Information pertaining to our factoring segment, which includes only factoring originated by our Triumph Business Capital subsidiary, summarized as of and for the quarters ended:

   March 31,  December 31,  September 30,  June 30,  March 31, 
  2020  2019  2019  2019  2019 
Factored receivable period end balance $641,366,000  $573,372,000  $562,009,000  $544,601,000  $534,420,000 
Yield on average receivable balance  16.13%  17.20%  18.23%  18.73%  17.96%
Rolling twelve quarter annual charge-off rate  0.42%  0.39%  0.36%  0.40%  0.39%
Factored receivables - transportation concentration  80%  81%  83%  83%  81%
                     
Interest income, including fees $23,497,000  $24,813,000  $24,869,000  $24,762,000  $23,803,000 
Non-interest income  1,296,000   1,154,000   1,291,000   1,205,000   1,077,000 
Factored receivable total revenue  24,793,000   25,967,000   26,160,000   25,967,000   24,880,000 
Average net funds employed  537,138,000   524,546,000   494,198,000   483,203,000   490,241,000 
Yield on average net funds employed  18.56%  19.64%  21.00%  21.55%  20.58%
                     
Accounts receivable purchased $1,450,618,000  $1,489,538,000  $1,450,905,000  $1,408,982,000  $1,325,140,000 
Number of invoices purchased  878,767   896,487   890,986   874,248   789,838 
Average invoice size $1,651  $1,662  $1,628  $1,612  $1,678 
Average invoice size - transportation $1,481  $1,507  $1,497  $1,492  $1,541 
Average invoice size - non-transportation $4,061  $3,891  $3,467  $3,047  $3,276 

Deposits summarized as of:

  March 31,  December 31,  September 30,  June 30,  March 31,  
(Dollars in thousands) 2020  2019  2019  2019  2019  
Non-interest bearing demand $846,412  $809,696  $754,233  $684,223  $667,597  
Interest bearing demand  583,445   580,323   587,123   587,164   602,088  
Individual retirement accounts  101,743   104,472   108,593   111,328   112,696  
Money market  412,376   497,105   424,162   440,289   372,109  
Savings  367,163   363,270   356,368   362,594   372,914  
Certificates of deposit  1,056,012   1,084,425   1,120,850   1,122,873   851,411  
Brokered deposits  314,864   350,615   346,504   350,507   335,625  
  Total deposits $3,682,015  $3,789,906  $3,697,833  $3,658,978  $3,314,440  

Net interest margin summarized for the three months ended:

   March 31, 2020  December 31, 2019 
  Average      Average  Average      Average 
(Dollars in thousands) Balance  Interest  Rate  Balance  Interest  Rate 
Interest earning assets:                        
Interest earning cash balances $141,123  $488   1.39% $153,160  $659   1.71%
Taxable securities  228,996   1,955   3.43%  254,255   2,157   3.37%
Tax-exempt securities  25,925   152   2.36%  37,680   222   2.34%
FHLB and other restricted stock  21,098   204   3.89%  25,599   165   2.56%
Loans  4,045,842   72,615   7.22%  4,134,393   77,968   7.48%
  Total interest earning assets $4,462,984  $75,414   6.80% $4,605,087  $81,171   6.99%
Non-interest earning assets:                        
Other assets  443,563           445,773         
  Total assets $4,906,547          $5,050,860         
Interest bearing liabilities:                        
Deposits:                        
Interest bearing demand $586,671  $344   0.24% $588,590  $373   0.25%
Individual retirement accounts  103,351   402   1.56%  106,645   435   1.62%
Money market  441,815   1,031   0.94%  490,438   1,542   1.25%
Savings  363,888   124   0.14%  359,024   119   0.13%
Certificates of deposit  1,068,023   6,006   2.26%  1,108,647   6,491   2.32%
  Brokered deposits  344,847   1,770   2.06%  350,737   2,001   2.26%
  Total interest bearing deposits  2,908,595   9,677   1.34%  3,004,081   10,961   1.45%
Subordinated notes  87,323   1,347   6.20%  63,706   1,035   6.45%
Junior subordinated debentures  39,609   646   6.56%  39,491   687   6.90%
Other borrowings  361,996   1,244   1.38%  438,447   2,080   1.88%
  Total interest bearing liabilities $3,397,523  $12,914   1.53% $3,545,725  $14,763   1.65%
Non-interest bearing liabilities and equity:                        
Non-interest bearing demand deposits  810,654           791,379         
Other liabilities  71,001           66,210         
Total equity  627,369           647,546         
Total liabilities and equity $4,906,547          $5,050,860         
Net interest income     $62,500          $66,408     
Interest spread          5.27%          5.34%
Net interest margin          5.63%          5.72%

Loan balance totals include respective nonaccrual assets.
Net interest spread is the yield on average interest earning assets less the rate on interest bearing liabilities.
Net interest margin is the ratio of net interest income to average interest earning assets.
Average rates have been annualized.


Metrics and non-GAAP financial reconciliation:

  As of and for the Three Months Ended 
 (Dollars in thousands, March 31,  December 31,  September 30,  June 30,  March 31, 
 except per share amounts) 2020  2019  2019  2019  2019 
Average total stockholders' equity $627,369  $647,546  $646,041  $652,347  $644,960 
Average goodwill and other intangibles  (189,359)  (191,551)  (193,765)  (196,002)  (198,389)
Average tangible common stockholders' equity $438,010  $455,995  $452,276  $456,346  $446,571 
                     
Net income (loss) $(4,450) $16,709  $14,317  $12,730  $14,788 
Average tangible common equity  438,010   455,995   452,276   456,346   446,571 
Return on average tangible common equity  (4.09%)  14.54%  12.56%  11.19%  13.43%
                     
                     
Total stockholders' equity $589,347  $636,590  $633,693  $643,362  $646,216 
Goodwill and other intangibles  (188,208)  (190,286)  (192,440)  (194,668)  (197,015)
Tangible common stockholders' equity $401,139  $446,304  $441,253  $448,694  $449,201 
Common shares outstanding  24,101,120   24,964,961   25,357,985   26,198,308   26,709,411 
Tangible book value per share $16.64  $17.88  $17.40  $17.13  $16.82 
                     
Total assets at end of period $5,353,729  $5,060,297  $5,039,697  $4,783,189  $4,529,783 
Goodwill and other intangibles  (188,208)  (190,286)  (192,440)  (194,668)  (197,015)
Tangible assets at period end $5,165,521  $4,870,011  $4,847,257  $4,588,521  $4,332,768 
Tangible common stockholders' equity ratio  7.77%  9.16%  9.10%  9.78%  10.37%

1) Triumph uses certain non-GAAP financial measures to provide meaningful supplemental information regarding Triumph's operational performance and to enhance investors' overall understanding of such financial performance.  The non-GAAP measures used by Triumph include the following:

  • “Adjusted diluted earnings per common share” is defined as adjusted net income available to common stockholders divided by adjusted weighted average diluted common shares outstanding.  Excluded from net income available to common stockholders are material gains and expenses related to merger and acquisition-related activities, including divestitures, net of tax. In our judgment, the adjustments made to net income available to common stockholders allow management and investors to better assess our performance in relation to our core net income by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.  Weighted average diluted common shares outstanding are adjusted as a result of changes in their dilutive properties given the gain and expense adjustments described herein.

  • "Tangible common stockholders' equity" is defined as common stockholders' equity less goodwill and other intangible assets.

  • "Total tangible assets" is defined as total assets less goodwill and other intangible assets.

  • "Tangible book value per share" is defined as tangible common stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.

  • "Tangible common stockholders' equity ratio" is defined as the ratio of tangible common stockholders' equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets.

  • "Return on Average Tangible Common Equity" is defined as net income available to common stockholders divided by average tangible common stockholders' equity.

  • "Adjusted efficiency ratio" is defined as non-interest expenses divided by our operating revenue, which is equal to net interest income plus non-interest income. Also excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. In our judgment, the adjustments made to operating revenue and non-interest expense allow management and investors to better assess our performance in relation to our core operating revenue by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.

  • "Adjusted net non-interest expense to average total assets" is defined as non-interest expenses net of non-interest income divided by total average assets. Excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures.  This metric is used by our management to better assess our operating efficiency. 

2) Performance ratios include discount accretion on purchased loans for the periods presented as follows:

  For the Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
(Dollars in thousands) 2020  2019  2019  2019  2019 
Loan discount accretion $2,134  $1,555  $1,159  $1,297  $1,557 

3) Asset quality ratios exclude loans held for sale, except for non-performing assets to total assets.

4) Past due ratio has been revised to exclude nonaccrual loans with contractual payments less than 30 days past due.

5) Beginning January 1, 2020, the allowance for credit losses was calculated in accordance with Accounting Standards Codification Topic 326, “Financial Instruments – Credit Losses” (“ASC 326”).  

6) Current quarter ratios are preliminary.

Source: Triumph Bancorp, Inc.

Investor Relations:
Luke Wyse
Senior Vice President, Finance & Investor Relations
lwyse@tbkbank.com
214-365-6936

Media Contact:
Amanda Tavackoli
Senior Vice President, Marketing & Communication
atavackoli@tbkbank.com
214-365-6930