BATON ROUGE, La., April 22, 2021 (GLOBE NEWSWIRE) -- Business First Bancshares, Inc. (NASDAQ: BFST) (Business First), parent company of b1BANK, Baton Rouge, Louisiana, today announced its unaudited results for the quarter ended March 31, 2021, including net income of $12.3 million, or $0.59 per diluted share, a decrease of $1.5 million and $0.08, respectively, from prior quarter ended December 31, 2020. On a non-GAAP basis, core net income for the quarter ended March 31, 2021, which excludes certain income and expenses, was $12.6 million, or $0.61 per diluted share, a decrease of $1.5 million and $0.07, respectively, from prior quarter ended December 31, 2020.
“2021 has gotten off to a fast start for b1BANK,” said Jude Melville, president and CEO. “Growth in our earnings power reflects successful integration of the significant merger we conducted in 2020, the additions to our board speak to our credibility as active participants in our community, and continued strong asset quality and stable NIM demonstrate our focus on the health of our portfolio even during a time of significant expansion. We’re especially excited about our acquisition of SSW and the capability that partnership gives us to more thoroughly serve our clients in the coming years.”
On April 22, 2021, Business First’s board of directors declared a quarterly dividend based upon financial performance for the first quarter in the amount of $0.12 per share, an increase of $0.02 from the prior quarter, to the common shareholders of record as of May 15, 2021. The dividend will be paid on May 31, 2021, or as soon thereafter as practicable.
Quarterly Highlights
- Smith Shellnut Wilson, LLC (SSW) Acquisition. On March 22, 2021, Business First, through b1BANK, entered into a definitive agreement to acquire SSW, a registered investment advisor with approximately $3.5 billion in assets under management, specializing in managing investment portfolios for corporations, foundations and individuals. The acquisition of SSW was subsequently completed on April 1, 2021.
- Subordinated Debt Issuance. On March 26, 2021, Business First issued $52.5 million in aggregate principal amount of its 4.250% fixed-to-floating subordinated notes due 2031. The subordinated notes were issued to certain qualified institutional buyers and institutional accredited investors in a private placement transaction that was exempt from registration under the Securities Act of 1933, as amended.
- Corporate Actions. Business First and b1BANK appointed John Ducrest, former Commissioner of the Louisiana Office of Financial Institutions (OFI) and immediate former Commissioner of Securities for the state of Louisiana, and Drew Brees, former quarterback of the New Orleans Saints, to their respective boards of directors during the quarter ended March 31, 2021.
- Small Business Administration (SBA) Paycheck Protection Program (PPP), Round 2. Business First has funded approximately 1,500 loans with an aggregate outstanding principal balance of $188.5 million under round 2 of the SBA PPP. Additionally, Business First will recognize approximately $8.6 million in fees associated with origination of these loans over their lives.
- Net Interest Margin and Spread. Net interest margin decreased from 4.26% for the quarter ended December 31, 2020, to 4.23% for the quarter ended March 31, 2021, while net interest spread increased from 4.03% to 4.06% for the quarters ended December 31, 2020, and March 31, 2021, respectively. Excluding loan discount accretion, non-GAAP net interest margin and spread were 3.91% and 3.73%, respectively, for the quarter ended March 31, 2021, compared to 3.99% and 3.75% for the quarter ended December 31, 2020.
Financial Condition
March 31, 2021, Compared to December 31, 2020
Loans
Loans held for investment increased $50.6 million, or 1.69 % (6.77 % annualized), for the quarter ended March 31, 2021. The increase was largely attributable to a net increase in SBA PPP loans (round 2) within the commercial portfolio of $71.9 million. Excluding the net increase in SBA PPP loans, total loans held for investment declined for the quarter ended March 31, 2021, by (0.74) %, or (2.96) % annualized. As of March 31, 2021, SBA PPP loans with a principal balance of $385.9 million remain outstanding.
Business First has not identified any unusual customer usage of unfunded commitments since the beginning of the COVID-19 pandemic in March 2020.
Credit Quality
Nonperforming loans as a percentage of total loans held for investment increased from 0.35% as of December 31, 2020, to 0.44% as of March 31, 2021. Nonperforming assets as a percentage of total assets increased from 0.48% as of December 31, 2020, to 0.52% as of March 31, 2021. The increase in both metrics was largely attributable to a single, energy-related loan with an outstanding balance of $1.9 million migrating to nonaccrual during the quarter ended March 31, 2021.
Cash and Securities Available for Sale
Cash, including federal funds sold, and securities available for sale increased by $137.6 million and $80.6 million, respectively, from the quarter ended December 31, 2020. The increases were largely attributable to the subordinated debt issuance on March 26, 2021, (which increased cash by approximately $41.4 million after repaying existing Business First outstanding debt), SBA PPP forgiveness reimbursements ($118.1 million), and increased municipal deposits ($85.4 million) which occurred during the quarter ended March 31, 2021.
Subordinated Debt
On March 26, 2021, Business First successfully completed a private placement of $52.5 million in aggregate principal amount of its 4.250% fixed-to-floating subordinated notes due 2031, callable by Business First beginning March 2026. The notes qualify for Tier 2 capital treatment for Business First for regulatory capital purposes.
Total Shareholders’ Equity
Book value per common share was $20.03 at March 31, 2021, compared to $19.88 at December 31, 2020. On a non-GAAP basis, tangible book value per share was $16.99 at March 31, 2021, compared to $16.80 at December 31, 2020. The increase was largely attributable to net income for the quarter less dividends distributed based on Q4 2020 performance.
March 31, 2021, Compared to March 31, 2020
Loans
Total loans held for investment increased by $1.3 billion compared to March 31, 2020, or 71.73%, due primarily to the acquisition of Pedestal and origination of SBA PPP loans.
Credit Quality
Nonperforming loans as a percentage of total loans held for investment decreased from 0.57% as of March 31, 2020, to 0.44% as of March 31, 2021. Nonperforming assets as a percentage of total assets decreased from 0.59% as of March 31, 2020, to 0.52% as of March 31, 2021. The decreases were largely attributable to an increase in overall total loans held for investment and total assets from the acquisition of Pedestal and SBA PPP activity.
Total Shareholders’ Equity
Book value per common share was $20.03 at March 31, 2021, compared to $21.58 at March 31, 2020. On a non-GAAP basis, tangible book value per share was $16.99 at March 31, 2021, compared to $17.38 at March 31, 2020. The decreases were attributable to the initial book value dilution caused by the acquisition of Pedestal during the quarter ended June 30, 2020.
Results of Operations
First Quarter 2021 Compared to Fourth Quarter 2020
Net Income and Diluted Earnings Per Share
For the quarter ended March 31, 2021, net income was $12.3 million, or $0.59 per diluted share, compared to net income of $13.8 million, or $0.67 per diluted share, for the quarter ended December 31, 2020. The decreases, $1.5 million and $0.08, respectively, were largely attributable to a reduction in gain on sale of loans, primarily attributable to the $4.4 million gain recognized from sales of loans originated under the Main Street Lending Program in the quarter ended December 31, 2020, offset by decreases in other expense due to extinguishment of Federal Home Loan Bank (FHLB) borrowings, of $2.4 million, and $842,000 in interest expense.
On a non-GAAP basis, core net income, which excludes certain income and expenses, for the quarter ended March 31, 2021, was $12.6 million, or $0.61 per diluted share, compared to core net income of $14.1 million, or $0.68 per diluted share, for the quarter ended December 31, 2020. Notable noncore events impacting earnings for the quarter ended March 31, 2021, included the incurrence of $350,000 in occupancy and bank premises expenses attributable to hurricane damage, compared to the incurrence of $568,000 in acquisition-related expenses and $158,000 in gains attributed to former bank premises and equipment in other income for the quarter ended December 31, 2020.
Interest Income
For the quarter ended March 31, 2021, net interest income totaled $40.3 million and net interest margin and net interest spread were 4.23% and 4.06%, respectively, compared to $39.6 million, 4.26% and 4.03% for the quarter ended December 31, 2020. The average yield on the loan portfolio (excluding SBA PPP loans) was 5.53% for the quarter ended March 31, 2021, compared to 5.59% for the quarter ended December 31, 2020. The average yield on total interest-earning assets was 4.65% for the quarter ended March 31, 2021, compared to 4.78% for the quarter ended December 31, 2020. The reduction in interest income was largely attributable to less days and lower yields, $1.0 million less interest income attributable to non-SBA PPP loans, offset by additional accelerated recognition of SBA PPP net loan origination fees due to forgiveness, $0.7 million, for the quarter ended March 31, 2021.
Net interest margin and net interest spread were positively impacted for the quarter ended March 31, 2021, by an additional $496,000 in loan discount accretion, 5 and 6 basis points, respectively, and an additional $777,000 in SBA PPP origination fees, 8 and 9 basis points, respectively, and a reduction in the overall cost of funds (which includes noninterest-bearing deposits).
The average loan yield (excluding SBA PPP loans) was impacted by the origination of loans at lower rates than payoffs during the quarter.
Non-GAAP net interest margin and net interest spread (excluding loan discount accretion of $3.1 million) were 3.91% and 3.73%, respectively, for the quarter ended March 31, 2021, compared to 3.99% and 3.75% (excluding loan discount accretion of $2.6 million) for the quarter ended December 31, 2020.
Interest Expense
For the quarter ended March 31, 2021, overall cost of funds (which includes noninterest-bearing deposits) decreased by 12 basis points, from 0.53% to 0.41%, compared to the quarter ended December 31, 2020. The decrease in cost of funds was largely attributable to the continuous repricing of maturing certificates of deposit, as well as the repricing of selected non-maturity deposits, and the impact of Business First’s extinguishment of certain FHLB borrowings in December 2020.
Other Income
For the quarter ended December 31, 2020, other income was impacted by a $4.4 million increase in gain on sale of loans primarily associated with the Main Street Lending Program, which accounted for the majority of the $4.5 million decrease in other income during the quarter ended March 31, 2021.
Other Expenses
For the quarter ended December 31, 2020, other expenses were impacted by a loss on early extinguishment of FHLB borrowings, resulting in a net loss of $2.4 million, which accounted for the majority of the $2.6 million decrease in other expense during the quarter ended March 31, 2021.
Provision for Loan Losses
During the quarter ended March 31, 2021, Business First recorded a provision for loan losses of $3.4 million, compared to $2.1 million for the quarter ended December 31, 2020. The increase for the quarter ended March 31, 2021, was driven primarily by the additional reserves ($1. 4 million) required on a $1.9 million energy-related loan which was transferred to nonaccrual during the quarter, as well as additional reserves necessary on acquired loans.
Return on Assets and Equity
Return on average assets and equity, each on an annualized basis, were 1.15% and 11.86%, respectively, for the quarter ended March 31, 2021, compared to 1.37% and 13.86%, respectively, for the quarter ended December 31, 2020. Both returns were negatively impacted by lower net income for the quarter ended March 31, 2021.
First Quarter 2021 Compared to First Quarter 2020
Net Income and Diluted Earnings Per Share
For the quarter ended March 31, 2021, net income was $12.3 million, or $0.59 per diluted share, compared to net income of $4.5 million, or $0.34 per diluted share, for the quarter ended March 31, 2020. The increases in net income and diluted earnings per share were largely attributable to the increases in net interest income and other income related to the acquisition of Pedestal on May 1, 2020, as well as the SBA PPP loans and lower costs of funds, offset by increases in the provision for loan losses and additional expenses associated with the acquisition of Pedestal.
On a non-GAAP basis, core net income, which excludes certain income and expenses, for the quarter ended March 31, 2021, was $12.6 million, or $0.61 per diluted share, compared to core net income of $5.0 million, or $0.37 per diluted share, for the quarter ended March 31, 2020. Notable noncore events impacting earnings for the quarter ended March 31, 2021, included the incurrence of $350,000 in occupancy and bank premises expenses attributable to hurricane damage, compared to the incurrence of $126,000 in gains associated with the disposal of former bank premises and equipment in other income and $1.2 million in acquisition-related expenses during the quarter ended March 31, 2020.
Interest Income
For the quarter ended March 31, 2021, net interest income totaled $40.3 million and net interest margin and net interest spread were 4.23% and 4.06%, respectively, compared to compared to $20.2 million, 3.93% and 3.55% for the quarter ended March 31, 2020. The average yield on the loan portfolio (excluding SBA PPP loans) was 5.53% for the quarter ended March 31, 2021, compared to 5.55% for the quarter ended March 31, 2020. The average yield on the loan portfolio (excluding SBA PPP loans) was positively impacted for the quarter ended March 31, 2021, by an additional $2.8 million in loan discount accretion, which accounted for 42 basis points. The increase in interest income was largely attributable to higher average balances due to the Pedestal acquisition, origination of SBA PPP loans, and larger loan purchase discount accretion.
Average yield on total interest-earning assets, net interest margin, and net interest spread were impacted for the quarter ended March 31, 2021, by the federal funds rate cuts of 150 basis points, which occurred late in the first quarter of 2020, as well as the subsequent impacts of the COVID-19 pandemic on the yield curve.
Non-GAAP net interest margin and net interest spread (excluding loan discount accretion of $3.1 million) were 3.91% and 3.73%, respectively, for the quarter ended March 31, 2021, compared to 3.88% and 3.49% (excluding loan discount accretion of $290,000) for the quarter ended March 31, 2020.
Interest Expense
For the quarter ended March 31, 2021, overall cost of funds (which includes noninterest-bearing deposits) decreased by 79 basis points, from 1.20% to 0.41%, compared to the quarter ended March 31, 2020. The decrease in cost of funds was partially attributable to the accretion of deposit and FHLB premiums associated with the Pedestal acquisition, $715,000 or 8 basis points, and the strategic extinguishment of FHLB advances which occurred in the quarter ended December 31, 2020, but primarily attributable to an overall reduction in interest rates on deposit offerings and the lower-yielding deposit portfolio acquired from Pedestal.
Other Income
For the quarter ended March 31, 2021, the increase in other income was largely attributable to the acquisition of Pedestal during the quarter ended June 30, 2020, compared to the quarter ended March 31, 2020.
Other Expenses
For the quarter ended March 31, 2021, the increase in other expense was largely attributable to the acquisition of Pedestal during the quarter ended June 30, 2020, compared to the quarter ended March 31, 2020.
Provision for Loan Losses
During the quarter ended March 31, 2021, Business First recorded a provision for loan losses of $3.4 million compared to $1.4 million for the quarter ended March 31, 2020. The increase for the quarter ended March 31, 2021, was impacted by the additional reserves ($1.4 million) required on a $1.9 million energy-related loan which was transferred to nonaccrual during the quarter, as well as additional reserves necessary on acquired loans.
Return on Assets and Equity
Return on average assets and return on average equity, each on an annualized basis, were 1.15% and 11.86%, respectively, for the quarter ended March 31, 2021, from 0.80% and 6.31%, respectively, for the quarter ended March 31, 2020. Both returns were positively impacted by higher net income for the quarter ended March 31, 2021.
About Business First Bancshares, Inc.
Business First Bancshares, Inc., through its banking subsidiary b1BANK operates 43 banking centers in markets across Louisiana and in the Dallas, Texas area. b1BANK provides commercial and personal banking, treasury management and wealth solutions services to small to midsize businesses and their owners and employees. Visit www.b1BANK.com for more information. Business First’s common stock is traded on the NASDAQ Global Select Market under the symbol “BFST.”
Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures (e.g., referenced as “core”) intended to supplement, not substitute for, comparable GAAP measures. These measures typically adjust income available to common shareholders for certain significant activities or transactions that, in management’s opinion, can distort period-to-period comparisons of Business First’s performance. Transactions that are typically excluded from non-GAAP measures include realized and unrealized gains/losses on former bank premises and equipment, investment sales, acquisition-related expenses (including, but not limited to, legal costs, system conversion costs, severance and retention payments, etc.). Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core business. These non-GAAP disclosures are not necessarily comparable to non-GAAP measures that may be presented by other companies. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of the tables below.
Special Note Regarding Forward-Looking Statements
Certain statements contained in this release may not be based on historical facts and are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “may,” “might,” “will,” “would,” “could,” or “intend.” We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors, including those factors specified in our Annual Report on Form 10-K and other public filings. Actual results will also be significantly impacted by the effects of the ongoing COVID-19 pandemic, including, among other effects: the impact of the public health crisis; the extent and duration of closures of businesses, including our branches, vendors and customers; the operation of financial markets; employment levels; market liquidity; the impact of various actions taken in response by the U.S. federal government, the Federal Reserve, other banking regulators, state and local governments; the adequacy of our allowance for loan losses in relation to potential losses in our loan portfolio; and the impact that all of these factors have on our borrowers, other customers, vendors and counterparties. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.
Additional Information
For additional information on Business First, you may obtain Business First’s reports that are filed with the Securities and Exchange Commission (SEC) free of charge by using the SEC’s EDGAR service on the SEC’s website at www.sec.gov or by contacting the SEC for further information at 1-800-SEC-0330. Alternatively, these documents can be obtained free of charge from Business First by directing a request to: Business First Bancshares, Inc., 500 Laurel Street, Suite 101, Baton Rouge, Louisiana 70801, Attention: Corporate Secretary.
No Offer or Solicitation
This release does not constitute or form part of any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.
Misty Albrecht
b1BANK
225.286.7879
Misty.Albrecht@b1BANK.com
| Business First Bancshares, Inc. | |||||||||
| Selected Financial Information | |||||||||
| (Unaudited) | |||||||||
| March 31, | December 31, | March 31, | |||||||
| (Dollars in thousands) | 2021 | 2020 | 2020 | ||||||
| Balance Sheet Ratios | |||||||||
| Loans (HFI) to Deposits | 78.83 | % | 82.71 | % | 98.26 | % | |||
| Shareholders' Equity to Assets Ratio | 9.38 | % | 9.85 | % | 12.33 | % | |||
| Loans Receivable Held for Investment | |||||||||
| Commercial (1) | $ | 962,099 | $ | 886,325 | $ | 431,992 | |||
| Real Estate: | |||||||||
| Construction and Land | 418,234 | 403,065 | 260,836 | ||||||
| Farmland | 52,861 | 55,883 | 53,900 | ||||||
| 1-4 Family Residential | 460,907 | 468,650 | 295,876 | ||||||
| Multi-Family Residential | 77,390 | 95,707 | 32,859 | ||||||
| Nonfarm Nonresidential | 966,416 | 971,603 | 623,114 | ||||||
| Total Real Estate | 1,975,808 | 1,994,908 | 1,266,585 | ||||||
| Consumer (1) | 104,071 | 110,122 | 72,803 | ||||||
| Total Loans (Held for Investment) | $ | 3,041,978 | $ | 2,991,355 | $ | 1,771,380 | |||
| Allowance for Loan Losses | |||||||||
| Balance, Beginning of Period | $ | 22,024 | $ | 20,340 | $ | 12,124 | |||
| Charge-offs – Quarterly | (309 | ) | (715 | ) | (194 | ) | |||
| Recoveries – Quarterly | 177 | 265 | 22 | ||||||
| Provision for Loan Losses – Quarterly | 3,359 | 2,134 | 1,367 | ||||||
| Balance, End of Period | $ | 25,251 | $ | 22,024 | $ | 13,319 | |||
| Allowance for Loan Losses to Total Loans (HFI) | 0.83 | % | 0.74 | % | 0.75 | % | |||
| Net Charge-offs (Recoveries) to Average Total Loans | 0.00 | % | 0.01 | % | 0.01 | % | |||
| Remaining Loan Purchase Discount | $ | 32,517 | $ | 35,580 | $ | 3,246 | |||
| Nonperforming Assets | |||||||||
| Nonperforming Loans: | |||||||||
| Nonaccrual Loans (2) | $ | 11,956 | $ | 9,063 | $ | 9,301 | |||
| Loans Past Due 90 Days or More (2) | 1,479 | 1,523 | 834 | ||||||
| Total Nonperforming Loans | 13,435 | 10,586 | 10,135 | ||||||
| Other Nonperforming Assets: | |||||||||
| Other Real Estate Owned | 8,851 | 9,051 | 3,281 | ||||||
| Other Nonperforming Assets: | 623 | 402 | 11 | ||||||
| Total Other Nonperforming Assets | 9,474 | 9,453 | 3,292 | ||||||
| Total Nonperforming Assets | $ | 22,909 | $ | 20,039 | $ | 13,427 | |||
| Nonperforming Loans to Total Loans (HFI) | 0.44 | % | 0.35 | % | 0.57 | % | |||
| Nonperforming Assets to Total Assets | 0.52 | % | 0.48 | % | 0.59 | % | |||
| (1) Small Business Administration (SBA) Paycheck Protection Program (PPP) loans accounted for $385.8 million and $0.1 million of the Commercial and Consumer portfolios, respectively, as of March 31, 2021. SBA PPP loans accounted for $313.9 million and $1.6 million of the Commercial and Consumer portfolios, respectively, as of December 31, 2020. | |||||||||
| (2) Past due and nonaccrual loan amounts exclude acquired impaired loans, even if contractually past due or if the Company does not expect to receive payment in full, as the Company is currently accreting interest income over the expected life of the loans. | |||||||||
| Business First Bancshares, Inc. | |||||||||
| Selected Financial Information | |||||||||
| (Unaudited) | |||||||||
| Three Months Ended | |||||||||
| March 31, | December 31, | March 31, | |||||||
| (Dollars in thousands, except per share data) | 2021 | 2020 | 2020 | ||||||
| Per Share Data | |||||||||
| Basic Earnings per Common Share | $ | 0.60 | $ | 0.67 | $ | 0.34 | |||
| Diluted Earnings per Common Share | 0.59 | 0.67 | $ | 0.34 | |||||
| Dividends per Common Share | 0.10 | 0.10 | 0.10 | ||||||
| Book Value per Common Share | 20.03 | 19.88 | 21.58 | ||||||
| Average Common Shares Outstanding | 20,621,930 | 20,590,239 | 13,313,154 | ||||||
| Average Diluted Shares Outstanding | 20,738,013 | 20,726,648 | 13,367,276 | ||||||
| End of Period Common Shares Outstanding | 20,804,753 | 20,621,437 | 13,067,987 | ||||||
| Annualized Performance Ratios | |||||||||
| Return on Average Assets | 1.15 | % | 1.37 | % | 0.80 | % | |||
| Return on Average Equity | 11.86 | % | 13.86 | % | 6.31 | % | |||
| Net Interest Margin | 4.23 | % | 4.26 | % | 3.93 | % | |||
| Net Interest Spread | 4.06 | % | 4.03 | % | 3.55 | % | |||
| Efficiency Ratio (1) | 59.40 | % | 60.27 | % | 72.39 | % | |||
| Total Quarterly/Year-to-Date Average Assets | $ | 4,276,430 | $ | 4,029,660 | $ | 2,244,584 | |||
| Total Quarterly/Year-to-Date Average Equity | 415,896 | 399,332 | 285,338 | ||||||
| Other Expenses | |||||||||
| Salaries and Employee Benefits | $ | 14,926 | $ | 14,908 | $ | 9,435 | |||
| Occupancy and Bank Premises | 1,811 | 1,525 | 1,060 | ||||||
| Depreciation and Amortization | 1,593 | 1,338 | 601 | ||||||
| Data Processing | 1,823 | 1,967 | 652 | ||||||
| FDIC Assessment Fees | 509 | 595 | 147 | ||||||
| Legal and Other Professional Fees | 741 | 626 | 394 | ||||||
| Advertising and Promotions | 477 | 645 | 306 | ||||||
| Utilities and Communications | 575 | 617 | 317 | ||||||
| Ad Valorem Shares Tax | 700 | 850 | 375 | ||||||
| Directors' Fees | 188 | 173 | 74 | ||||||
| Other Real Estate Owned Expenses and Write-Downs | 379 | 132 | 253 | ||||||
| Merger and Conversion-Related Expenses | 10 | 548 | 1,148 | ||||||
| Other | 3,231 | 5,678 | 1,881 | ||||||
| Total Other Expenses | $ | 26,963 | $ | 29,602 | $ | 16,643 | |||
| Other Income | |||||||||
| Service Charges on Deposit Accounts | $ | 1,567 | $ | 1,672 | $ | 931 | |||
| Gain (Loss) on Sales of Securities | (5 | ) | 15 | 25 | |||||
| Debit card and ATM Fee Income | 1,336 | 1,555 | 407 | ||||||
| Bank-Owned Life Insurance Income | 318 | 251 | 197 | ||||||
| Gain (Loss) on Sales of Loans | (21 | ) | 4,413 | 177 | |||||
| Mortgage Origination Income | 229 | 208 | 115 | ||||||
| Brokerage Commission | 543 | 433 | 20 | ||||||
| Correspondent Bank Income | 143 | 49 | 109 | ||||||
| Participation Fee Income | 247 | 114 | 68 | ||||||
| Gain on Sales of Other Real Estate Owned | 46 | 199 | 151 | ||||||
| Gain on Disposal of Other Assets | 117 | 51 | 14 | ||||||
| Pass-through Income from SBIC Partnerships | 53 | 170 | 380 | ||||||
| Other | 510 | 417 | 210 | ||||||
| Total Other Income | $ | 5,083 | $ | 9,547 | $ | 2,804 | |||
| (1) Noninterest expense (excluding provision for loan losses) divided by noninterest income plus net interest income less gain/loss on sales of securities. | |||||||||
| Business First Bancshares, Inc. | |||||||||
| Consolidated Balance Sheets | |||||||||
| (Unaudited) | |||||||||
| March 31, | December 31, | March 31, | |||||||
| (Dollars in thousands) | 2021 | 2020 | 2020 | ||||||
| Assets | |||||||||
| Cash and Due From Banks | $ | 355,257 | $ | 149,131 | $ | 80,109 | |||
| Federal Funds Sold | 105,595 | 174,152 | 29,135 | ||||||
| Securities Available for Sale, at Fair Values | 721,224 | 640,605 | 275,115 | ||||||
| Mortgage Loans Held for Sale | 2,298 | 969 | 868 | ||||||
| Loans and Lease Receivable | 3,041,978 | 2,991,355 | 1,771,380 | ||||||
| Allowance for Loan Losses | (25,251 | ) | (22,024 | ) | (13,319 | ) | |||
| Net Loans and Lease Receivable | 3,016,727 | 2,969,331 | 1,758,061 | ||||||
| Premises and Equipment, Net | 57,931 | 58,593 | 29,656 | ||||||
| Accrued Interest Receivable | 25,910 | 23,895 | 7,724 | ||||||
| Other Equity Securities | 12,584 | 12,693 | 11,721 | ||||||
| Other Real Estate Owned | 8,851 | 9,051 | 3,281 | ||||||
| Cash Value of Life Insurance | 60,348 | 45,030 | 32,765 | ||||||
| Deferred Taxes, Net | 5,536 | 5,858 | 1,800 | ||||||
| Goodwill | 53,753 | 53,862 | 48,495 | ||||||
| Core Deposit Intangible | 9,406 | 9,734 | 6,471 | ||||||
| Other Assets | 8,166 | 7,456 | 2,461 | ||||||
| Total Assets | $ | 4,443,586 | $ | 4,160,360 | $ | 2,287,662 | |||
| Liabilities | |||||||||
| Deposits | |||||||||
| Noninterest-Bearing | $ | 1,186,625 | $ | 1,164,139 | $ | 417,534 | |||
| Interest-Bearing | 2,672,109 | 2,452,540 | 1,385,274 | ||||||
| Total Deposits | 3,858,734 | 3,616,679 | 1,802,808 | ||||||
| Securities Sold Under Agreements to Repurchase | 21,419 | 21,825 | 14,728 | ||||||
| Short-Term Borrowings | 20 | 5,020 | 5,000 | ||||||
| Long-Term Borrowings | - | 6,000 | - | ||||||
| Subordinated Debt | 77,500 | 25,000 | 25,000 | ||||||
| Subordinated Debt - Trust Preferred Securities | 5,000 | 5,000 | - | ||||||
| Federal Home Loan Bank Borrowings | 33,073 | 43,145 | 138,000 | ||||||
| Accrued Interest Payable | 1,941 | 2,499 | 1,573 | ||||||
| Other Liabilities | 29,198 | 25,229 | 18,523 | ||||||
| Total Liabilities | 4,026,885 | 3,750,397 | 2,005,632 | ||||||
| Shareholders' Equity | |||||||||
| Common Stock | 20,805 | 20,621 | 13,068 | ||||||
| Additional Paid-In Capital | 300,282 | 299,540 | 206,966 | ||||||
| Retained Earnings | 89,441 | 79,174 | 59,859 | ||||||
| Accumulated Other Comprehensive Income | 6,173 | 10,628 | 2,137 | ||||||
| Total Shareholders' Equity | 416,701 | 409,963 | 282,030 | ||||||
| Total Liabilities and Shareholders' Equity | $ | 4,443,586 | $ | 4,160,360 | $ | 2,287,662 | |||
| Business First Bancshares, Inc. | |||||||
| Consolidated Statements of Income | |||||||
| (Unaudited) | |||||||
| Three Months Ended | |||||||
| March 31, | December 31, | March 31, | |||||
| (Dollars in thousands) | 2021 | 2020 | 2020 | ||||
| Interest Income: | |||||||
| Interest and Fees on Loans | $ | 41,419 | $ | 41,762 | $ | 24,143 | |
| Interest and Dividends on Securities | 2,802 | 2,572 | 1,731 | ||||
| Interest on Federal Funds Sold and Due From Banks | 41 | 53 | 142 | ||||
| Total Interest Income | 44,262 | 44,387 | 26,016 | ||||
| Interest Expense: | |||||||
| Interest on Deposits | 3,243 | 3,736 | 4,686 | ||||
| Interest on Borrowings | 718 | 1,067 | 1,119 | ||||
| Total Interest Expense | 3,961 | 4,803 | 5,805 | ||||
| Net Interest Income | 40,301 | 39,584 | 20,211 | ||||
| Provision for Loan Losses: | 3,359 | 2,134 | 1,367 | ||||
| Net Interest Income After Provision for Loan Losses | 36,942 | 37,450 | 18,844 | ||||
| Other Income: | |||||||
| Service Charges on Deposit Accounts | 1,567 | 1,672 | 931 | ||||
| Gain (Loss) on Sales of Securities | (5 | ) | 15 | 25 | |||
| Gain (Loss) on Sales of Loans | (21 | ) | 4,413 | 177 | |||
| Other Income | 3,542 | 3,447 | 1,671 | ||||
| Total Other Income | 5,083 | 9,547 | 2,804 | ||||
| Other Expenses: | |||||||
| Salaries and Employee Benefits | 14,926 | 14,908 | 9,435 | ||||
| Occupancy and Equipment Expense | 3,717 | 3,373 | 1,891 | ||||
| Merger and Conversion-Related Expense | 10 | 548 | 1,148 | ||||
| Other Expenses | 8,310 | 10,773 | 4,169 | ||||
| Total Other Expenses | 26,963 | 29,602 | 16,643 | ||||
| Income Before Income Taxes: | 15,062 | 17,395 | 5,005 | ||||
| Provision for Income Taxes: | 2,733 | 3,561 | 506 | ||||
| Net Income: | $ | 12,329 | $ | 13,834 | $ | 4,499 | |
| Business First Bancshares, Inc. | |||||||||||||||||||||||
| Consolidated Net Interest Margin | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three Months Ended | |||||||||||||||||||||||
| March 31, 2021 | December 31, 2020 | March 31, 2020 | |||||||||||||||||||||
| Average | Average | Average | |||||||||||||||||||||
| Outstanding | Interest Earned / | Average | Outstanding | Interest Earned / | Average | Outstanding | Interest Earned / | Average | |||||||||||||||
| (Dollars in thousands) | Balance | Interest Paid | Yield / Rate | Balance | Interest Paid | Yield / Rate | Balance | Interest Paid | Yield / Rate | ||||||||||||||
| Assets | |||||||||||||||||||||||
| Interest-Earning Assets: | |||||||||||||||||||||||
| Total Loans (Excluding SBA PPP) | $ | 2,643,668 | $ | 36,538 | 5.53 | % | $ | 2,685,093 | $ | 37,509 | 5.59 | % | $ | 1,740,189 | $ | 24,143 | 5.55 | % | |||||
| SBA PPP Loans | 374,958 | 4,881 | 5.21 | % | 365,058 | $ | 4,253 | 4.66 | % | - | - | 0.00 | % | ||||||||||
| Securities Available for Sale | 691,476 | 2,802 | 1.62 | % | 603,192 | 2,572 | 1.71 | % | 286,660 | 1,731 | 2.42 | % | |||||||||||
| Interest-Bearing Deposit in Other Banks | 101,233 | 41 | 0.16 | % | 61,485 | 53 | 0.34 | % | 28,754 | 142 | 1.98 | % | |||||||||||
| Total Interest-Earning Assets | 3,811,335 | 44,262 | 4.65 | % | 3,714,828 | 44,387 | 4.78 | % | 2,055,603 | 26,016 | 5.06 | % | |||||||||||
| Allowance for Loan Losses | (22,709 | ) | (21,020 | ) | (12,203 | ) | |||||||||||||||||
| Noninterest-Earning Assets | 487,804 | 335,852 | 201,184 | ||||||||||||||||||||
| Total Assets | $ | 4,276,430 | $ | 44,262 | $ | 4,029,660 | $ | 44,387 | $ | 2,244,584 | $ | 26,016 | |||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||||||||||
| Interest-Bearing Liabilities: | |||||||||||||||||||||||
| Interest-Bearing Deposits | $ | 2,584,263 | $ | 3,243 | 0.50 | % | $ | 2,313,511 | $ | 3,736 | 0.65 | % | $ | 1,342,213 | $ | 4,686 | 1.40 | % | |||||
| Subordinated Debt | 28,450 | 459 | 6.45 | % | 25,000 | 422 | 6.75 | % | 25,000 | 422 | 6.75 | % | |||||||||||
| Subordinated Debt - Trust Preferred Securities | 5,000 | 42 | 3.36 | % | 5,000 | 42 | 3.36 | % | - | - | 0.00 | % | |||||||||||
| Advances from Federal Home Loan Bank (FHLB) | 37,022 | 111 | 1.20 | % | 105,640 | 407 | 1.54 | % | 98,323 | 497 | 2.02 | % | |||||||||||
| Paycheck Protection Program Liquidity Facility (PPPLF) | - | - | 0.00 | % | 79,450 | 70 | 0.35 | % | - | - | 0.00 | % | |||||||||||
| Other Borrowings | 31,696 | 106 | 1.34 | % | 37,605 | 126 | 1.34 | % | 67,125 | 200 | 1.19 | % | |||||||||||
| Total Interest-Bearing Liabilities | 2,686,431 | 3,961 | 0.59 | % | 2,566,206 | 4,803 | 0.75 | % | 1,532,661 | 5,805 | 1.52 | % | |||||||||||
| Noninterest-Bearing Liabilities: | |||||||||||||||||||||||
| Noninterest-Bearing Deposits | $ | 1,146,950 | $ | 1,033,593 | $ | 406,035 | |||||||||||||||||
| Other Liabilities | 27,153 | 30,529 | 20,550 | ||||||||||||||||||||
| Total Noninterest-Bearing Liabilities | 1,174,103 | 1,064,122 | 426,585 | ||||||||||||||||||||
| Shareholders' Equity: | 415,896 | 399,332 | 285,338 | ||||||||||||||||||||
| Total Liabilities and Shareholders' Equity | $ | 4,276,430 | $ | 4,029,660 | $ | 2,244,584 | |||||||||||||||||
| Net Interest Spread | 4.06 | % | 4.03 | % | 3.55 | % | |||||||||||||||||
| Net Interest Income | $ | 40,301 | $ | 39,584 | $ | 20,211 | |||||||||||||||||
| Net Interest Margin | 4.23 | % | 4.26 | % | 3.93 | % | |||||||||||||||||
| Overall Cost of Funds | 0.41 | % | 0.53 | % | 1.20 | % | |||||||||||||||||
| NOTE: Average outstanding balances are determined utilizing monthly averages and average yield/rate is calculated utilizing a 30/360 day count convention. | |||||||||||||||||||||||
| Business First Bancshares, Inc. | |||||||||
| Non-GAAP Measures | |||||||||
| (Unaudited) | |||||||||
| Three Months Ended | |||||||||
| March 31, | December 31, | March 31, | |||||||
| (Dollars in thousands, except per share data) | 2021 | 2020 | 2020 | ||||||
| Interest Income: | |||||||||
| Interest income | $ | 44,262 | $ | 44,387 | $ | 26,016 | |||
| Core interest income | 44,262 | 44,387 | 26,016 | ||||||
| Interest Expense: | |||||||||
| Interest expense | 3,961 | 4,803 | 5,805 | ||||||
| Core interest expense | 3,961 | 4,803 | 5,805 | ||||||
| Provision for Loan Losses: (b) | |||||||||
| Provision for loan losses | 3,359 | 2,134 | 1,367 | ||||||
| Core provision expense | 3,359 | 2,134 | 1,367 | ||||||
| Other Income: | |||||||||
| Other income | 5,083 | 9,547 | 2,804 | ||||||
| (Gains) 1osses on former bank premises and equipment | - | (158 | ) | (126 | ) | ||||
| (Gains) 1osses on sale of securities | 5 | (15 | ) | (25 | ) | ||||
| Core other income | 5,088 | 9,374 | 2,653 | ||||||
| Other Expense: | |||||||||
| Other expense | 26,963 | 29,602 | 16,643 | ||||||
| Acquisition-related expenses (2) | (10 | ) | (568 | ) | (1,212 | ) | |||
| Stock option exercises - excess taxes (founder's grants) | - | - | (71 | ) | |||||
| Occupancy and bank premises - hurricane repair | (350 | ) | - | - | |||||
| Core other expense | 26,603 | 29,034 | 15,360 | ||||||
| Pre-Tax Income: (a) | |||||||||
| Pre-tax income | 15,062 | 17,395 | 5,005 | ||||||
| (Gains) 1osses on former bank premises and equipment | - | (158 | ) | (126 | ) | ||||
| (Gains) 1osses on sale of securities | 5 | (15 | ) | (25 | ) | ||||
| Acquisition-related expenses (2) | 10 | 568 | 1,212 | ||||||
| Stock option exercises - excess taxes (founder's grants) | - | - | 71 | ||||||
| Occupancy and bank premises - hurricane repair | 350 | - | - | ||||||
| Core pre-tax income | 15,427 | 17,790 | 6,137 | ||||||
| Provision for Income Taxes: (1) | |||||||||
| Provision for income taxes | 2,733 | 3,561 | 506 | ||||||
| Tax on (gains) on former bank premises and equipment | - | (33 | ) | (26 | ) | ||||
| Tax on (gains) on sale of securities | 1 | (3 | ) | (5 | ) | ||||
| Tax on acquisition-related expenses (2) | 2 | 120 | 91 | ||||||
| Tax on stock option exercises (founder's grants) | - | - | 602 | ||||||
| Tax on occupancy and bank premises - hurricane repair | 74 | - | - | ||||||
| Core provision for income taxes | 2,810 | 3,645 | 1,168 | ||||||
| Net Income: | |||||||||
| Net income | 12,329 | 13,834 | 4,499 | ||||||
| (Gains) losses on former bank premises and equipment , net of tax | - | (125 | ) | (100 | ) | ||||
| Losses (Gains) on sale of securities, net of tax | 4 | (12 | ) | (20 | ) | ||||
| Acquisition-related expenses (2), net of tax | 8 | 448 | 1,121 | ||||||
| Stock option exercises, net of tax (founder's grants) | - | - | (531 | ) | |||||
| Occupancy and bank premises - hurricane repair, net of tax | 277 | - | - | ||||||
| Core net income | $ | 12,618 | $ | 14,145 | $ | 4,969 | |||
| Pre-tax, pre-provision earnings (a+b) | $ | 18,421 | $ | 19,529 | $ | 6,372 | |||
| (Gains) losses on former bank premises and equipment | - | (158 | ) | (126 | ) | ||||
| (Gains) losses on sale of securities | 5 | (15 | ) | (25 | ) | ||||
| Acquisition-related expenses (2) | 10 | 568 | 1,212 | ||||||
| Stock option exercises (founder's grants) | - | - | 71 | ||||||
| Occupancy and bank premises - hurricane repair | 350 | - | - | ||||||
| Core pre-tax, pre-provision earnings | $ | 18,786 | $ | 19,924 | $ | 7,504 | |||
| Average Diluted Shares Outstanding | 20,738,013 | 20,726,648 | 13,367,276 | ||||||
| Diluted Earnings Per Share: | |||||||||
| Diluted earnings per share | $ | 0.59 | $ | 0.67 | $ | 0.34 | |||
| (Gains) losses on former bank premises and equipment , net of tax | - | (0.01 | ) | (0.01 | ) | ||||
| (Gains) losses on sale of securities, net of tax | 0.00 | (0.00 | ) | (0.00 | ) | ||||
| Acquisition-related expenses (2), net of tax | 0.00 | 0.02 | 0.08 | ||||||
| Stock option exercises (founder's grants) | - | - | (0.04 | ) | |||||
| Occupancy and bank premises - hurricane repair, net of tax | 0.02 | - | - | ||||||
| Core diluted earnings per share | $ | 0.61 | $ | 0.68 | $ | 0.37 | |||
| Pre-tax, pre-provision profit diluted earnings per share | $ | 0.89 | $ | 0.94 | $ | 0.48 | |||
| (Gains) losses on former bank premises and equipment | - | (0.01 | ) | (0.01 | ) | ||||
| (Gains) losses on sale of securities | 0.00 | (0.00 | ) | (0.00 | ) | ||||
| Acquisition-related expenses (2) | 0.00 | 0.03 | 0.09 | ||||||
| Stock option exercises (founder's grants) | - | - | 0.01 | ||||||
| Occupancy and bank premises - hurricane repair | 0.02 | - | - | ||||||
| Core pre-tax, pre-provision diluted earnings per share | $ | 0.91 | $ | 0.96 | $ | 0.56 | |||
| (1) Tax rates, exclusive of certain nondeductible merger-related expenses and goodwill, utilized were 21% for 2021 and 2020. These rates approximated the marginal tax rates. | |||||||||
| (2) Includes merger and conversion-related expenses and salary and employee benefits. | |||||||||
| Business First Bancshares, Inc. | |||||||||
| Non-GAAP Measures | |||||||||
| (Unaudited) | |||||||||
| Three Months Ended | |||||||||
| March 31, | December 31, | March 31, | |||||||
| (Dollars in thousands, except per share data) | 2021 | 2020 | 2020 | ||||||
| Total Quarterly/Year-to-Date Average Assets | $ | 4,276,430 | $ | 4,029,660 | $ | 2,244,584 | |||
| Total Quarterly/Year-to-Date Average Equity | $ | 415,896 | $ | 399,332 | $ | 285,338 | |||
| Net Income: | |||||||||
| Net income | $ | 12,329 | $ | 13,834 | $ | 4,499 | |||
| (Gains) losses on former bank premises and equipment , net of tax | - | (125 | ) | (100 | ) | ||||
| (Gains) losses on sale of securities, net of tax | 4 | (12 | ) | (20 | ) | ||||
| Acquisition-related expenses (2), net of tax | 8 | 448 | 1,121 | ||||||
| Stock option exercises, net of tax (founder's grants) | - | - | (531 | ) | |||||
| Occupancy and bank premises - hurricane repair, net of tax | 277 | - | - | ||||||
| Core net income | $ | 12,618 | $ | 14,145 | $ | 4,969 | |||
| Return on average assets | 1.15 | % | 1.37 | % | 0.80 | % | |||
| Core return on average assets | 1.18 | % | 1.40 | % | 0.89 | % | |||
| Return on equity | 11.86 | % | 13.86 | % | 6.31 | % | |||
| Core return on average equity | 12.14 | % | 14.17 | % | 6.97 | % | |||
| Interest Income: | |||||||||
| Interest income | $ | 44,262 | $ | 44,387 | $ | 26,016 | |||
| Core interest income | 44,262 | 44,387 | 26,016 | ||||||
| Interest Expense: | |||||||||
| Interest expense | 3,961 | 4,803 | 5,805 | ||||||
| Core interest expense | 3,961 | 4,803 | 5,805 | ||||||
| Other Income: | |||||||||
| Other income | 5,083 | 9,547 | 2,804 | ||||||
| (Gains) losses on former bank premises and equipment | - | (158 | ) | (126 | ) | ||||
| (Gains) losses on sale of securities | 5 | (15 | ) | (25 | ) | ||||
| Core other income | 5,088 | 9,374 | 2,653 | ||||||
| Other Expense: | |||||||||
| Other expense | 26,963 | 29,602 | 16,643 | ||||||
| Acquisition-related expenses | (10 | ) | (568 | ) | (1,212 | ) | |||
| Stock option exercises - excess taxes (founder's grants) | - | - | (71 | ) | |||||
| Occupancy and bank premises - hurricane repair | (350 | ) | - | - | |||||
| Core other expense | $ | 26,603 | $ | 29,034 | $ | 15,360 | |||
| Efficiency Ratio: | |||||||||
| Other expense (a) | $ | 26,963 | $ | 29,602 | $ | 16,643 | |||
| Core other expense (c) | $ | 26,603 | $ | 29,034 | $ | 15,360 | |||
| Net interest and other income (1) (b) | $ | 45,389 | $ | 49,116 | $ | 22,990 | |||
| Core net interest and other income (1) (d) | $ | 45,389 | $ | 48,958 | $ | 22,864 | |||
| Efficiency ratio (a/b) | 59.40 | % | 60.27 | % | 72.39 | % | |||
| Core efficiency ratio (c/d) | 58.61 | % | 59.30 | % | 67.18 | % | |||
| Total Average Interest-Earnings Assets | $ | 3,811,335 | $ | 3,714,828 | $ | 2,055,603 | |||
| Net Interest Income: | |||||||||
| Net interest income | $ | 40,301 | $ | 39,584 | $ | 20,211 | |||
| Loan discount accretion | (3,063 | ) | (2,567 | ) | (290 | ) | |||
| Net interest income excluding loan discount accretion | $ | 37,238 | $ | 37,017 | $ | 19,921 | |||
| Net interest margin (2) | 4.23 | % | 4.26 | % | 3.93 | % | |||
| Net interest margin excluding loan discount accretion (2) | 3.91 | % | 3.99 | % | 3.88 | % | |||
| Net interest spread | 4.06 | % | 4.03 | % | 3.55 | % | |||
| Net interest spread excluding loan discount accretion | 3.73 | % | 3.75 | % | 3.49 | % | |||
| (1) Excludes gains/losses on sales of securities. | |||||||||
| (2) Calculated utilizing a 30/360 day count convention. | |||||||||
| Business First Bancshares, Inc. | |||||||||
| Non-GAAP Measures | |||||||||
| (Unaudited) | |||||||||
| | |||||||||
| March 31, | December 31, | March 31, | |||||||
| (Dollars in thousands, except per share data) | 2021 | 2020 | 2020 | ||||||
| Total Shareholders' (Common) Equity: | |||||||||
| Total shareholders' equity | $ | 416,701 | $ | 409,963 | $ | 282,030 | |||
| Goodwill | (53,753 | ) | (53,862 | ) | (48,495 | ) | |||
| Core deposit intangible | (9,406 | ) | (9,734 | ) | (6,471 | ) | |||
| Total tangible common equity | $ | 353,542 | $ | 346,367 | $ | 227,064 | |||
| Total Assets: | |||||||||
| Total assets | $ | 4,443,586 | $ | 4,160,360 | $ | 2,287,662 | |||
| Goodwill | (53,753 | ) | (53,862 | ) | (48,495 | ) | |||
| Core deposit intangible | (9,406 | ) | (9,734 | ) | (6,471 | ) | |||
| Total tangible assets | $ | 4,380,427 | $ | 4,096,764 | $ | 2,232,696 | |||
| Common shares outstanding | 20,804,753 | 20,621,437 | 13,067,987 | ||||||
| Book value per common share | $ | 20.03 | $ | 19.88 | $ | 21.58 | |||
| Tangible book value per common share | $ | 16.99 | $ | 16.80 | $ | 17.38 | |||
| Common equity to total assets | 9.38 | % | 9.85 | % | 12.33 | % | |||
| Tangible common equity to tangible assets | 8.07 | % | 8.45 | % | 10.17 | % | |||