Le Lézard
Classified in: Business
Subject: ERN

BancFirst Corporation Reports Third Quarter Earnings


OKLAHOMA CITY, Oct. 19, 2017 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS:BANF) reported net income of $21.7 million, or $0.67 diluted earnings per share, for the third quarter of 2017 compared to net income of $18.0 million, or $0.57 diluted earnings per share, for the third quarter of 2016. Net income for the nine months ended September 30, 2017 was $66.9 million, or $2.06 per share, compared to $52.1 million, or $1.64 per share, for the first nine months of 2016. Net income for the first nine months of 2017 included the effects of favorable resolutions of three problem loans which resulted in principal recovery of $894,000 and unaccrued interest income of $2.7 million. Net income for the first nine months of 2016 included a gain on the sale of other real estate owned totaling $1.2 million.

The Company's net interest income for the third quarter of 2017 increased to $57.2 million compared to $51.4 million for the third quarter of 2016. The net interest margin for the quarter was 3.46% compared to 3.27% a year ago. The increase in margin was primarily due to the increase in the federal funds rate. The provision for loan losses for the third quarter of 2017 increased to $3.3 million compared to $2.9 million a year ago. The provision for loan losses for the third quarter of 2017 was primarily driven by downgrades of commercial loans, which resulted in approximately $2.5 million in provision, and by loan growth, which resulted in approximately $750,000 in provision. Net charge-offs were stable at 0.02% of average loans for the third quarter of 2017 compared to 0.03% for the third quarter of 2016. Noninterest income for the quarter totaled $29.2 million, compared to $27.9 million last year. Noninterest expense for the quarter totaled $50.6 million compared to $49.2 million last year. The increase in noninterest expense was primarily due to salary increases in 2017. The Company's effective tax rate was 33.3% compared to 33.9% for the third quarter of 2016.

At September 30, 2017, the Company's total assets were $7.1 billion, $113.2 million above the December 31, 2016 total. Loans totaled $4.7 billion, an increase of $71.1 million over June 30, 2017, and an increase of $249.0 million over December 31, 2016. Deposits were $6.3 billion at September 30, 2017, up $66.4 million from last quarter, and $54.0 million above the December 31, 2016 total. The Company's total stockholders' equity was $764.4 million, an increase of $53.3 million over December 31, 2016.

Asset quality remained strong during the third quarter of 2017. Nonperforming and restructured assets were 0.53% of total assets at September 30, 2017 compared to 0.42% at June 30, 2017, and 0.56% at December 31, 2016. The increase in nonperforming and restructured assets from June 30, 2017 was due primarily to the downgrade of two commercial loans. The decrease in nonperforming and restructured assets from December 31, 2016 was largely due to the resolution of problem loans during the first two quarters of 2017. The allowance for loan losses to total loans was 1.10% at September 30, 2017, 1.07% at June 30, 2017, and 1.10% at December 31, 2016. The allowance to nonperforming and restructured loans was 153.5% compared to 193.1% at June 30, 2017, and 137.3% at year-end 2016.

On July 31, 2017, the Company completed a two-for-one stock split of the Company's outstanding shares of common stock. The stock was issued in the form of a dividend on July 31, 2017 to shareholders of record of the outstanding common stock as of the close of business on the record date of July 17, 2017. Stockholders received one additional share for each share held on that date. This represents the second stock split for the Company since going public in 1993.

On September 7, 2017, the Company announced it had entered into agreements to acquire two Oklahoma banking corporations with combined total assets of $370 million, in exchange for a combination of cash and stock. The transactions are expected to be completed in January 2018 upon regulatory approval. 

BancFirst Corporation is an Oklahoma based financial services holding company. The Company's principal subsidiary bank, BancFirst, is Oklahoma's largest state-chartered bank with 100 banking locations serving 53 communities across Oklahoma. More information can be found at www.bancfirst.bank.

The Company may make forward-looking statements within the meaning of Section 27A of the securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 with respect to earnings, credit quality, corporate objectives, interest rates and other financial and business matters. Forward-looking statements include estimates and give management's current expectations or forecasts of future events. The Company cautions readers that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, including economic conditions, the performance of financial markets and interest rates; legislative and regulatory actions and reforms; competition; as well as other factors, all of which change over time. Actual results may differ materially from forward-looking statements.

 

BancFirst Corporation

Summary Financial Information

(Dollars in thousands, except per share and share data - Unaudited)





2017


2017


2017


2016


2016



3rd Qtr 


2nd Qtr 


1st Qtr 


4th Qtr 


3rd Qtr 


Condensed Income Statements: 











Net interest income 

$               57,233


$               56,439


$               54,768


$               51,553


$               51,431


Provision for loan losses 

3,276


1,841


72


1,672


2,940


Non-interest income:











Trust revenue

3,083


2,894


2,952


2,878


2,685


Service charges on deposits

16,633


16,448


15,778


16,005


16,033


Securities transactions

(22)


(330)


---


52


(146)


Income from sales of loans

732


816


632


705


863


Insurance commissions

4,603


3,728


4,563


3,797


4,372


Cash management

2,804


2,799


2,754


2,713


2,853


Other

1,336


1,628


1,406


1,281


1,267


Total noninterest income 

29,169


27,983


28,085


27,431


27,927













 Non-interest expense:











Salaries and employee benefits

31,471


31,547


30,654


29,706


30,591


Occupancy expense, net

3,298


2,992


2,974


3,198


3,217


Depreciation

2,493


2,392


2,420


2,461


2,556


Amortization of intangible assets

547


547


547


548


560


Data processing services

1,110


1,097


1,195


1,229


1,178


Net expense from other real estate owned

68


202


50


197


162


Marketing and business promotion

1,790


1,559


2,215


1,978


1,779


Deposit insurance

553


542


588


569


641


Other

9,270


8,075


8,945


8,303


8,520


Total noninterest expense 

50,600


48,953


49,588


48,189


49,204


 Income before income taxes 

32,526


33,628


33,193


29,123


27,214


 Income tax expense 

10,816


10,446


11,143


10,503


9,232


 Net income 

$               21,710


$               23,182


$               22,050


$               18,620


$               17,982


 Per Common Share Data: 











 Net income-basic 

$                   0.68


$                   0.73


$                   0.70


$                   0.60


$                   0.58


 Net income-diluted 

0.67


0.71


0.68


0.58


0.57


 Cash dividends declared

0.21


0.19


0.19


0.19


0.19


 Common shares outstanding 

31,863,063


31,818,438


31,782,552


31,621,870


31,390,166


 Average common shares outstanding -











   Basic

31,838,392


31,807,610


31,729,614


31,487,540


31,262,188


   Diluted

32,592,277


32,523,376


32,475,996


32,092,122


31,844,418


 Performance Ratios: 











 Return on average assets

1.22

%

1.31

%

1.27

%

1.07

%

1.06

%

 Return on average equity

11.34


12.52


12.37


10.44


10.35


 Net interest margin 

3.46


3.43


3.39


3.19


3.27


 Efficiency ratio 

58.56


57.99


59.85


61.01


62.00













 

BancFirst Corporation

Summary Financial Information

(Dollars in thousands, except per share and share data - Unaudited)



Nine months ended

September 30,



2017


2016


Condensed Income Statements: 





Net interest income 

$             168,440


$             152,275


Provision for loan losses 

5,189


9,847


Non-interest income:





Trust revenue

8,929


7,752


Service charges on deposits

48,859


46,228


Securities transactions

(352)


(111)


Income from sales of loans

2,180


2,120


Insurance commissions

12,894


11,762


Cash management

8,357


7,903


Other

4,370


3,947


Total noninterest income 

85,237


79,601







 Non-interest expense:





Salaries and employee benefits

93,672


89,956


Occupancy expense, net

9,264


9,115


Depreciation

7,305


7,653


Amortization of intangible assets

1,641


1,721


Data processing services

3,402


3,567


Net expense (income) from other real estate owned

320


(944)


Marketing and business promotion

5,564


5,258


Deposit insurance

1,683


2,335


Other

26,290


24,554


Total noninterest expense 

149,141


143,215


 Income before income taxes 

99,347


78,814


 Income tax expense 

32,405


26,760


 Net income 

$               66,942


$               52,054


 Per Common Share Data: 





 Net income-basic 

$                   2.11


$                   1.67


 Net income-diluted 

2.06


1.64


 Cash dividends declared

0.59


0.55


 Common shares outstanding 

31,863,063


31,390,166


 Average common shares outstanding -





   Basic

31,792,270


31,143,980


   Diluted

32,534,219


31,725,560


 Performance Ratios: 





 Return on average assets

1.26

%

1.03

%

 Return on average stockholders' equity

12.06


10.27


 Net interest margin 

3.42


3.27


 Efficiency ratio 

58.79


61.76


 

BancFirst Corporation

Summary Financial Information

(Dollars in thousands, except per share and share data - Unaudited)





2017


2017


2017


2016


2016



3rd Qtr 


2nd Qtr 


1st Qtr


4th Qtr 


3rd Qtr 


 Balance Sheet Data:






















 Total assets

$  7,132,168


$  7,046,589


$    7,189,637


$    7,018,952


$     6,783,537


 Interest-bearing deposits with banks

1,530,928


1,533,147


1,857,961


1,666,540


1,532,095


 Securities

450,009


451,402


463,250


469,833


473,738


 Total loans

4,658,525


4,587,454


4,398,529


4,409,550


4,317,512


 Allowance for loan losses

(51,255)


(49,005)


(47,921)


(48,693)


(48,061)


 Deposits

6,302,046


6,235,682


6,394,627


6,248,057


6,024,949


 Stockholders' equity

764,414


748,462


729,873


711,094


693,731


 Book value per common share

23.99


23.53


22.97


22.49


22.10


 Tangible book value per common share (non-GAAP)(1)

21.93


21.44


20.86


20.36


19.94


 Balance Sheet Ratios:











 Average loans to deposits

73.59

%

71.47

%

70.13

%

70.98

%

71.77

%

 Average earning assets to total assets

93.37


93.44


93.45


93.30


93.16


 Average stockholders' equity to average assets

10.74


10.46


10.25


10.26


10.22


Asset Quality Data:











 Past due loans

$         2,122


$        2,217


$           2,024


$           1,962


$            1,906


 Nonaccrual loans

27,665


19,607


23,694


31,798


31,014


 Restructured loans

3,603


3,561


2,203


1,713


1,842


 Total nonperforming and restructured loans

33,390


25,385


27,921


35,473


34,762


 Other real estate owned and repossessed assets

4,099


4,211


4,404


3,866


4,339


 Total nonperforming and restructured assets

37,489


29,596


32,325


39,339


39,101


 Nonperforming and restructured loans to total loans

0.72

%

0.55

%

0.63

%

0.80

%

0.81

%

 Nonperforming and restructured assets to total assets

0.53


0.42


0.45


0.56


0.58


 Allowance to total loans

1.10


1.07


1.09


1.10


1.11


 Allowance to nonperforming and restructured loans

153.50


193.05


171.63


137.27


138.26


 Net charge-offs to average loans

0.02


0.02


0.02


0.02


0.03













Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(2):











Stockholders' equity

$    764,414


$    748,462


$      729,873


$      711,094


$        693,731


Less goodwill

54,042


54,042


54,042


54,042


54,042


Less intangible assets, net

11,645


12,203


12,768


13,330


13,898


Tangible stockholders' equity (non-GAAP)

$     698,727


$     682,217


$      663,063


$      643,722


$         625,791


Common shares outstanding

31,863,063


31,818,438


31,782,552


31,621,870


31,390,166


 Tangible book value per common share (non-GAAP)

21.93


21.44


20.86


20.36


19.94















(1)     Refer to the "Reconciliation of Tangible Book Value per Common Share (non-GAAP)" Table.

(2)     Tangible book value per common share is stockholders' equity less goodwill and intangible assets, net, divided by common shares outstanding. This amount is a non-GAAP financial measure but has been included as it is considered to be a critical metric with which to analyze and evaluate the financial condition and capital strength of the Company. This measure should not be considered a substitute for operating results determined in accordance with GAAP.

 

BancFirst Corporation

Consolidated Average Balance Sheets

And Interest Margin Analysis

Taxable Equivalent Basis

(Dollars in thousands - Unaudited)



Three Months Ended


Nine Months Ended



September 30, 2017


September 30, 2017





Interest


Average




Interest


Average



Average


Income/


Yield/


Average


Income/


Yield/



Balance


Expense


Rate


Balance


Expense


Rate


ASSETS













Earning assets:













  Loans

$           4,597,267


$           56,319


4.86

%

$        4,501,675


$         165,132


4.90

%

  Securities ? taxable

421,464


1,763


1.66


427,635


5,430


1.70


  Securities ? tax exempt

30,920


287


3.68


32,107


848


3.53


  Interest bearing deposits with banks

1,552,975


4,978


1.27


1,650,902


12,844


1.04


     Total earning assets

6,602,626


63,347


3.81


6,612,319


184,254


3.73















Nonearning assets:













  Cash and due from banks

176,194






174,975






  Interest receivable and other assets

341,724






339,232






  Allowance for loan losses

(49,186)






(48,644)






     Total nonearning assets

468,732






465,563






     Total assets

$            7,071,358






$        7,077,882



















LIABILITIES AND













  STOCKHOLDERS' EQUITY













Interest bearing liabilities:













  Transaction deposits                      

$           759,160


$               372


0.19

%

$           782,588


$               796


0.14

%

  Savings deposits

2,304,342


3,479


0.60


2,280,310


8,554


0.50


  Time deposits

668,378


1,396


0.83


678,520


3,922


0.77


  Short-term borrowings

2,262


6


0.99


1,906


13


0.92


  Junior subordinated debentures

31,959


532


6.60


31,959


1,589


6.65


     Total interest bearing liabilities

3,766,101


5,785


0.61


3,775,283


14,874


0.53















Interest free funds:













  Noninterest bearing deposits

2,515,521






2,533,750






  Interest payable and other liabilities

30,071






26,801






  Stockholders' equity

759,665






742,048






     Total interest free  funds

3,305,257






3,302,599






     Total liabilities and stockholders' equity

$            7,071,358






$        7,077,882






Net interest income



$           57,562






$         169,380




Net interest spread





3.20

%





3.20

%

Effect of interest free funds





0.26

%





0.22

%

Net interest margin





3.46

%





3.42

%
















 

SOURCE BancFirst


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