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ServisFirst Bancshares, Inc.
850 Shades Creek Parkway Suite 200
Birmingham, AL 35209-4510

 

(205) 949-0302

Investor Relations Contact
Mr. Davis S. Mange
(205) 949-3420
dmange@servisfirstbank.com

Transfer Agent
By Regular Mail
Computershare
P.O. BOX 30170
College Station, TX 77842

 

By Overnight Delivery
Computershare
211 Quality Circle Suite 210
College Station, TX 77845

 

(800) 368-5948

 

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Press Releases

ServisFirst Bancshares, Inc. Announces Results For First Quarter 2015

Apr 20, 2015

BIRMINGHAM, Ala., April 20, 2015 /PRNewswire/ -- ServisFirst Bancshares, Inc. ("ServisFirst") (NASDAQ: SFBS), the holding company for ServisFirst Bank, today announced earnings and operating results for the quarter ended March 31, 2015.

FIRST QUARTER 2015 HIGHLIGHTS:

  • Core net income of $14.8 million, a 21% increase year over year
  • Core EPS of $0.56 for the first quarter, excluding merger-related charges, a 6% increase year over year
  • Loans and deposits increased 23% and 20%, respectively, year over year, led by organic growth
  • Closed the acquisition of Metro Bancshares, Inc. in Atlanta on January 31, 2015
  • Production team (excluding mortgage origination) increased from 91 to 110 in the first quarter, with eight added through the Metro Bank acquisition

Tom Broughton, President and CEO, said, "We are pleased to welcome our new bankers, as we had the largest increase in our production team during a period in our ten year history.  We continue to believe that ServisFirst Bank is the best place for commercial and private bankers to provide service to their clients."  Bud Foshee, CFO, stated, "Our focus for 2015 will be on improved net interest margins and continued quality customer service."

FINANCIAL SUMMARY

(in Thousands except share and per share amounts)









Period Ending
March 31, 2015


Period Ending
December 31,
2014


% Change
From Period
Ending
December 31,
2014 to
Period
Ending March 31,
2015


Period Ending
March 31, 2014


% Change
From Period
Ending March
31, 2014 to
Period Ending
March 31,
2015

QUARTERLY OPERATING RESULTS



















Net Income


$

13,055



$

15,032



(13)

%


$

11,758



11

%

Net Income Available to Common Stockholders


$

12,955



$

14,917



(13)

%


$

11,658



11

%

Diluted Earnings Per Share


$

0.49



$

0.58



(16)

%


$

0.51



(4)

%

Return on Average Assets



1.26

%



1.47

%






1.35

%




Return on Average Common Stockholders' Equity



13.55

%



16.39

%






17.83

%




Average Diluted Shares Outstanding



26,237,980




25,697,531







22,985,670


























Core Net Income*


$

14,822



$

15,032



(1)

%


$

12,215



21

%

Core Net Income Available to Common Stockholders*


$

14,722



$

14,917



(1)

%


$

12,115



22

%

Core Diluted Earnings Per Share*


$

0.56



$

0.58



(3)

%


$

0.53



6

%

Core Return on Average Assets*



1.43

%



1.47

%






1.42

%




Core Return on Average Common Stockholders' Equity*



15.39

%



16.39

%






18.53

%

























BALANCE SHEET



















Total Assets


$

4,393,342



$

4,098,679



7

%


$

3,572,914



23

%

Loans



3,607,852




3,359,858



7

%



2,937,797



23

%

Non-interest-bearing Demand Deposits



866,743




810,460



7

%



662,834



31

%

Total Deposits



3,638,763




3,398,160



7

%



3,031,041



20

%

Stockholders' Equity



441,458




407,213



8

%



312,283



41

%






















* Core measures in the first quarter of 2015 exclude merger expenses related to the acquisition of Metro Bancshares, Inc. and reserves for losses in unfunded loan commitments and letters of credit resulting from our change in methodology for estimating such losses, and in the first quarter of 2014 resulting from a correction of our accounting for vested stock options previously granted to members of our advisory boards in our markets.  For a reconciliation of these non-GAAP measures to the most comparable GAAP measure, see "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" below.

 

DETAILED FINANCIALS

ServisFirst Bancshares, Inc. reported net income of $13.1 million and net income available to common stockholders of $13.0 million for the quarter ended March 31, 2015, compared to net income of $11.8 million and net income available to common stockholders of $11.7 million for the same quarter in 2014.  Net income for the quarter ended March 31, 2015 was impacted by $2.1 million in merger expenses related to the acquisition of Metro Bancshares, Inc. ("Metro").  Basic and diluted earnings per common share were $0.51 and $0.49, respectively, for the first quarter of 2015, compared to $0.53 and $0.51, respectively, for the first quarter of 2014.  Excluding merger expenses and the initial funding of reserves for unfunded loan commitments, net of tax, basic and diluted earnings per common share were $0.58 and $0.56, respectively.

Return on average assets was 1.26% and return on average common stockholders' equity was 13.55% for the first quarter of 2015, compared to 1.35% and 17.83%, respectively, for the first quarter of 2014.

Net interest income was $37.0 million for the first quarter of 2015, compared to $34.5 million for the fourth quarter of 2014 and $30.8 million for the first quarter of 2014.  The net interest margin in the first quarter of 2015 was 3.80%, a 24 basis point increase from the fourth quarter of 2014 and the same as the first quarter of 2014.  Net accretion resulting from the fair value adjustments on acquired assets and assumed liabilities contributed 4 basis points to the net interest margin in the first quarter of 2015.  The increase in net interest income on a linked quarter basis is attributable to a $276.8 million increase in average loans outstanding and a $26.8 million increase in average stockholders' equity, all resulting in a positive mix change in our balance sheet.  The increase in net interest margin is the result of improved loan yields and lower average balances in federal funds at other banks and at the Federal Reserve, which earn a nominal interest rate. 

Average loans for the first quarter of 2015 were $3.50 billion, an increase of $276.8 million, or 9%, over average loans of $3.23 billion for the fourth quarter of 2014, and an increase of $595.6 million, or 20%, over average loans of $2.91 billion for the first quarter of 2014.  The increase in loans included approximately $152.9 million of loans acquired in the Metro acquisition.

Average total deposits for the first quarter of 2015 were $3.47 billion, an increase of $63.0 million, or 1.9%, over average total deposits of $3.41 billion for the fourth quarter of 2014, and an increase of $493.7 million, or 17%, over average total deposits of $2.97 billion for the first quarter of 2014.  The increase in total average deposits included approximately $178.3 million of deposits acquired in the Metro acquisition as of February 1, 2015.

At March 31, 2015, non-performing assets to total assets were 0.40%, a decrease of one basis point compared to 0.41% for the fourth quarter of 2014 and a decrease of thirteen basis points compared to 0.53% for the first quarter of 2014.  The amount of non-performing assets to total assets attributable to the acquisition of Metro was 0.08% for the first quarter of 2015.  Net credit charge-offs to average loans were 0.08%, an eleven basis point decrease compared to 0.19% for the fourth quarter of 2014 and a nine basis point decrease compared to 0.17% for the first quarter of 2014.  We recorded a $2.4 million provision for loan losses in the first quarter of 2015, a decrease of $0.4 million compared to $2.8 million in the fourth quarter of 2014 and an increase of $0.1 million compared to $2.3 million in the first quarter of 2014.  The loan loss reserve as a percentage of total loans decreased two basis points to 1.04% at March 31, 2015, compared to 1.06% at December 31, 2014 and a decrease of four basis points compared to 1.08% at March 31, 2014.  The decrease in loan loss reserve as a percentage of loans related to the acquisition of Metro was 0.03% for the first quarter of 2015.  In management's opinion, the reserve is adequate and was determined by consistent application of ServisFirst Bank's methodology for calculating its reserve for loan losses.

Non-interest income increased $902,000 in the first quarter of 2015, or 41%, compared to the first quarter of 2014.  Deposit service charges increased by $339,000, or 39%.  Approximately 1,900 checking accounts were acquired in the Metro acquisition.  Mortgage banking income increased $170,000, or 60%, as a result of increases in refinancing activity.  Increases in the cash surrender value of our life insurance contracts resulted from added investments in contracts during the third quarter of 2014 and the addition of $2.7 million in contracts as a result of the Metro acquisition.

Non-interest expense for the first quarter of 2015 increased $5.1 million, or 37%, to $18.8 million from $13.7 million in the first quarter of 2014.  Salary and benefit expense for the first quarter of 2015 increased $1.3 million, or 17%, to $9.0 million from $7.7 million in the first quarter of 2014, and increased $2.7 million, or 43%, on a linked quarter basis.  Thirty-eight Metro employees came over as part of the acquisition on February 1, 2015 and 32 remain employed by the Company as of March 31, 2015.  Eleven new sales officers, in addition to those from Metro, were added during the first quarter of 2015.  Salary and benefit expense for the first quarter of 2014 includes a non-routine expense of $703,000 resulting from a correction of our accounting for vested stock options previously granted to members of our advisory boards in our Dothan, Huntsville and Montgomery, Alabama markets.  Merger expenses related to the acquisition of Metro were $2.1 million in the first quarter of 2015.  Other operating expense for the first quarter of 2015 increased $1.4 million, or 45%, to $4.6 million from $3.1 million in the first quarter of 2014.  This increase was primarily attributable to $500,000 in expense for the initial funding of reserves for unfunded loan commitments as of March 31, 2015, consistent with guidance provided in the Federal Reserve Bank's Inter-agency Policy Statement SR 06-17, $140,000 of increased charges from the Federal Reserve Bank as part of our increased clearing services for correspondent bank clients, and $121,000 of other operating expenses in our Atlanta region.

GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures

As discussed in more detail in the section titled "Detailed Financials," we recorded expenses of $2.1 million for the first quarter of 2015 related to the acquisition of Metro Bancshares, Inc. and the merger of Metro Bank with and into the Bank, and recorded an expense of $500,000 resulting from the initial funding of reserves for unfunded loan commitments as of March 31, 2015, consistent with guidance provided in the Federal Reserve Bank's Inter-agency Policy Statement SR 06-17.  We recorded a non-routine expense of $703,000 for the first quarter of 2014 resulting from the correction of our accounting for vested stock options previously granted to members of our advisory boards in our Dothan, Huntsville and Montgomery, Alabama markets.  This change in accounting treatment is a non-cash item and does not impact our operating activities or cash from operations.  The non-GAAP financial measures included in this press release of our results for the first quarter of 2015 are "core net income," "core net income available to common stockholders," "core diluted earnings per share," "core return on average assets" and "core return on average common stockholders' equity."  Each of these five core financial measures excludes the impact of the merger expenses, the initial funding of a reserve for unfunded loan commitments, and the non-routine expense attributable to the correction of our accounting for vested stock options.  None of the other periods included in this press release are affected by such non-routine expenses.

"Core net income" is defined as net income, adjusted by the net effect of the non-routine expense.

"Core net income available to common stockholders" is defined as net income available to common stockholders, adjusted by the net effect of the non-routine expense.

"Core diluted earnings per share" is defined as net income available to common stockholders, adjusted by the net effect of the non-routine expense, divided by weighted average diluted shares outstanding.

"Core return on average assets" is defined as net income, adjusted by the net effect of the non-routine expense, divided by average total assets.

"Core return on average common stockholders' equity" is defined as net income, adjusted by the net effect of the non-routine expense, divided by average common stockholders' equity.

We present tangible book value per share and the ratio of tangible common equity to total tangible assets in our Selected Financial Highlights table.  Our acquisition of Metro resulted in goodwill and other identifiable intangible assets, which are subtracted from equity and assets in the computation of tangible book value per share and tangible common equity to total tangible assets.

We believe these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that these non-GAAP financial measures have a number of limitations.  As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies, including those in our industry, use.  The following reconciliation table provides a more detailed analysis of the non-GAAP financial measures for the first quarter of 2015 and the first quarter of 2014.  Dollars are in thousands, except share and per share data.

 




For the Period
Ended March 31,
2015


For the Period
Ended March 31,
2014


Provision for income taxes - GAAP


$

5,903



$

5,229




Adjustments:











Adjustment for non-routine expense



829




246



Core provision for income taxes


$

6,732



$

5,475














Return on average assets - GAAP



1.26

%



1.35

%


Net income - GAAP


$

13,055



$

11,758




Adjustments:











Adjustment for non-routine expense



1,767




457



Core net income


$

14,822



$

12,215



Average assets


$

4,193,413



$

3,500,257



Core return on average assets



1.43

%



1.42

%













Return on average common stockholders' equity



13.55

%



17.83

%


Net income available to common stockholders - GAAP


$

12,955



$

11,658




Adjustments:











Adjustment for non-routine expense



1,767




457



Core net income available to common stockholders


$

14,722



$

12,115



Average common stockholders' equity


$

387,870



$

265,188



Core return on average common stockholders' equity



15.39

%



18.53

%













Earnings per share - diluted - GAAP


$

0.49



$

0.51



Weighted average shares outstanding, diluted



26,237,980




22,985,670



Core diluted earnings per share


$

0.56



$

0.53














Book value per share


$

15.65







Total common stockholders' equity - GAAP



401,500








Adjustments:











Adjusted for goodwill and other identifiable intangible assets



18,069







Tangible common stockholders' equity


$

383,431







Tangible bookvalue per share


$

14.95


















Stockholders' equity to total assets



10.05

%






Total assets - GAAP


$

4,393,342








Adjustments:











Adjusted for goodwill and other identifiable intangible assets



18,069







Total tangible assets


$

4,375,273







Tangible common equity to total tangible assets



8.76

%






 

About ServisFirst Bancshares, Inc.

ServisFirst Bancshares, Inc. is a bank holding company based in Birmingham, Alabama. Through its subsidiary ServisFirst Bank, ServisFirst Bancshares, Inc. provides business and personal financial services from locations in Birmingham, Huntsville, Montgomery, Mobile and Dothan, Alabama, Pensacola, Florida, Nashville, Tennessee, Atlanta, Georgia, and Charleston, South Carolina.

ServisFirst Bancshares, Inc. files periodic reports with the U.S. Securities and Exchange Commission (SEC).  Copies of its filings may be obtained through the SEC's website at www.sec.gov or at www.servisfirstbank.com.

Webcast

As previously announced, ServisFirst will host a live audio webcast to discuss first quarter earnings and results beginning at 9:30 a.m. ET on April 21, 2015. The webcast can be accessed at www.servisfirstbank.com on the "Investor Relations" page in the "Events and Webcasts" section. A replay of the call will be available until April 30, 2015.

Additional Information

This release contains, and the remarks by ServisFirst's management on the live audio webcast may contain, forward-looking statements within the meaning of the securities laws giving ServisFirst's expectations or predictions of future financial or business performance or conditions. Forward-looking statements are typically identified by words such as "believe," "expect," "anticipate," "intend," "target," "estimate," "continue," "positions," "prospects" or "potential," by future conditional verbs such as "will," "would," "should," "could" or "may", or by variations of such words or by similar expressions. These forward-looking statements are not guarantees of future performance and are subject to numerous assumptions, risks and uncertainties, many of which are outside of ServisFirst's control and which may change over time and cause actual results to differ materially from those expressed or implied by the forward-looking statements. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to "Cautionary Note Regarding Forward-looking Statements" and "Risk Factors" in our most recent Annual Report on Form 10-K and to our other filings with the U.S. Securities and Exchange Commission ("SEC"). Forward-looking statements speak only as of the date they are made, and ServisFirst assumes no duty to update forward-looking statements. 

CONTACT: ServisFirst Bank
Davis Mange (205) 949-3420
dmange@servisfirstbank.com

 


SELECTED FINANCIAL HIGHLIGHTS
(UNAUDITED)







(In thousands except share and per share data)






1st Quarter 2015


4th Quarter 2014


3rd Quarter 2014


2nd Quarter 2014


1st Quarter 2014

CONSOLIDATED STATEMENT OF INCOME





















Interest income


$

40,783



$

38,163



$

36,857



$

35,424



$

34,281


Interest expense



3,746




3,703




3,538




3,446




3,432


Net interest income



37,037




34,460




33,319




31,978




30,849


Provision for loan losses



2,405




2,759




2,748




2,438




2,314


Net interest income after provision for loan losses



34,632




31,701




30,571




29,540




28,535


Non-interest income



3,077




3,110




3,006




2,938




2,175


Non-interest expense



18,751




13,143




15,315




15,417




13,723


Income before income tax



18,958




21,668




18,262




17,061




16,987


Provision for income tax



5,903




6,636




4,260




5,476




5,229


Net income



13,055




15,032




14,002




11,585




11,758


Preferred stock dividends



100




115




100




116




100


Net income available to common stockholders


$

12,955



$

14,917



$

13,902



$

11,469



$

11,658


Earnings per share - basic


$

0.51



$

0.60



$

0.56



$

0.49



$

0.53


Earnings per share - diluted


$

0.49



$

0.58



$

0.54



$

0.46



$

0.51


Average diluted shares outstanding



26,237,980




25,697,531




25,726,313




24,823,590




22,985,670























CONSOLIDATED BALANCE SHEET DATA





















Total assets


$

4,393,342



$

4,098,679



$

3,952,799



$

3,762,684



$

3,572,914


Loans



3,607,852




3,359,858




3,159,772




3,053,989




2,937,797


Debt securities



336,505




327,665




332,351




325,432




309,475


Non-interest-bearing demand deposits



866,743




810,460




794,553




729,163




662,834


Total deposits



3,638,763




3,398,160




3,352,766




3,157,642




3,031,041


Borrowings



21,278




19,973




19,965




19,957




19,949


Stockholders' equity


$

441,458



$

407,213



$

393,136



$

380,074



$

312,283























Shares outstanding



25,653,610




24,801,518




24,791,436




24,749,436




22,574,436


Book value per share


$

15.65



$

14.81



$

14.25



$

13.74



$

12.06


Tangible book value per share (1)


$

14.95



$

14.81



$

14.25



$

13.74



$

12.06























SELECTED FINANCIAL RATIOS





















Net interest margin



3.80

%



3.56

%



3.65

%



3.74

%



3.80

%

Return on average assets



1.26

%



1.47

%



1.45

%



1.28

%



1.36

%

Return on average common stockholders' equity



13.55

%



16.39

%



15.89

%



15.03

%



17.83

%

Efficiency ratio



46.74

%



34.98

%



42.16

%



44.15

%



41.55

%

Non-interest expense to average earning assets



1.90

%



1.34

%



1.66

%



1.78

%



1.66

%

Tangible common equity to total tangible assets (1)



8.76

%



8.96

%



8.93

%



9.04

%



7.62

%






















CAPITAL RATIOS





















Total Capital to Risk-Weighted Assets:



13.09

%



13.38

%



13.70

%



13.74

%



11.94

%

Tier 1 Capital to Risk-Weighted Assets:



11.51

%



11.75

%



12.02

%



12.04

%



10.22

%

Tier 1 Capital to Average Assets:



10.06

%



9.91

%



10.18

%



10.32

%



8.81

%

Common Equity Tier 1 Capital to Risk-Weighted Assets (2):



10.41

%



N/A




N/A




N/A




N/A























(1) See "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" for a discussion of these Non-GAAP financial measures.

(2) Basel III final capital rules, including the new Common Equity Tier I Capital to Risk-Weighted Assets ratio, became effective for the Company on January 1, 2015.

 


CONSOLIDATED BALANCE SHEETS (UNAUDITED)





(In thousands)















March 31, 2015


March 31, 2014


% Change


ASSETS











Cash and cash equivalents



299,679



222,492


34

%


Available for sale debt securities, at fair value



307,379



277,501


11

%


Held to maturity debt securities (fair value of $29,886 and $31,559 at












March 31, 2015 and 2014, respectively)



29,126



31,974


(9)

%


Restricted equity securities



4,853



3,738


30

%


Mortgage loans held for sale



12,384



6,704


85

%


Loans



3,607,852



2,937,797


23

%


Less allowance for loan losses



(37,356)



(31,728)


18

%



Loans, net



3,570,496



2,906,069


23

%


Premises and equipment, net



16,082



8,015


101

%


Goodwill and other identifiable intangible assets



18,069



-





Other assets



135,274



116,421


32

%



Total assets


$

4,393,342


$

3,572,914


23

%


LIABILITIES AND STOCKHOLDERS' EQUITY











Liabilities:











Deposits:












Non-interest-bearing


$

866,743


$

662,834


31

%



Interest-bearing



2,772,020



2,368,207


17

%




Total deposits



3,638,763



3,031,041


20

%


Federal funds purchased



280,900



195,762


43

%


Other borrowings



21,278



19,949


7

%


Other liabilities



10,943



13,879


(21)

%



Total liabilities



3,951,884



3,260,631


21

%


Stockholders' equity:












Preferred stock, Series A Senior Non-Cumulative Perpetual, par value $0.001













(liquidation preference $1,000), net of discount; 40,000 shares authorized,













40,000 shares issued and outstanding at March 31, 2015 and 2014



39,958



39,958


-

%



Common stock, par value $0.0001 per share; 50,000,000 shares authorized;













25,653,610 shares issued and outstanding at March 31, 2015 and













22,574,436 shares issued and outstanding at March 31, 2014



26



8


225

%



Additional paid-in capital



207,374



127,218


63

%



Retained earnings



188,507



140,538


34

%



Accumulated other comprehensive income



5,216



4,309


21

%



Noncontrolling interest



377



252


50

%




Total stockholders' equity



441,458



312,283


41

%



Total liabilities and stockholders' equity


$

4,393,342


$

3,572,914


23

%


 

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(In thousands except per share data)





Three Months Ended March 31,





2015


2014

Interest income:








Interest and fees on loans


$

38,646


$

32,252


Taxable securities



1,128



1,097


Nontaxable securities



860



871


Federal funds sold



77



42


Other interest and dividends



72



19


   Total interest income



40,783



34,281

Interest expense:








Deposits



3,270



3,014


Borrowed funds



476



418


   Total interest expense



3,746



3,432


   Net interest income



37,037



30,849

Provision for loan losses



2,405



2,314


   Net interest income after provision for loan losses



34,632



28,535

Non-interest income:








Service charges on deposit accounts



1,207



868


Mortgage banking



454



284


Securities gains



29



-


Increase in cash surrender value life insurance



648



536


Other operating income



739



487


   Total non-interest income



3,077



2,175

Non-interest expense:








Salaries and employee benefits



9,008



7,697


Equipment and occupancy expense



1,661



1,366


Professional services



568



516


FDIC and other regulatory assessments



620



517


Other real estate owned expense



214



487


Merger expenses



2,096



-


Other operating expense



4,584



3,140


   Total non-interest expense



18,751



13,723


   Income before income tax



18,958



16,987

Provision for income tax



5,903



5,229


         Net income



13,055



11,758


Dividends on preferred stock



100



100


         Net income available to common stockholders


$

12,955


$

11,658

Basic earnings per common share


$

0.51


$

0.53

Diluted earnings per common share


$

0.49


$

0.51

 


LOANS BY TYPE












(UNAUDITED)













(In thousands)




















1st Quarter 2015


4th Quarter 2014


3rd Quarter 2014


2nd Quarter 2014


1st Quarter 2014


Commercial, financial and agricultural


$

1,543,531


$

1,495,092


$

1,382,607


$

1,362,757


$

1,306,058


Real estate - construction



219,005



208,769



194,506



178,033



157,127


Real estate - mortgage:


















Owner-occupied commercial



869,724



793,917



773,432



708,294



711,067



1-4 family mortgage



375,770



333,455



314,778



296,220



285,368



Other mortgage



545,668



471,363



443,245



457,845



428,391


Subtotal: Real estate - mortgage



1,791,162



1,598,735



1,531,455



1,462,359



1,424,826


Consumer



54,154



57,262



51,204



50,840



49,786


Total loans


$

3,607,852


$

3,359,858


$

3,159,772


$

3,053,989


$

2,937,797


 


SUMMARY OF LON LOSS EXPERIENCE












(Dollars in thousands)



















1st Quarter 2015


4th Quarter 2014


3rd Quarter 2014


2nd Quarter 2014


1st Quarter 2014


Reserve for loan losses:






















Beginning balance


$

35,629



$

34,442



$

32,984



$

31,728



$

30,663



Loans charged off:























Commercial financial and agricultural



77




416




531




142




1,222




Real estate - construction



382




309




610




325




23




Real estate - mortgage:



433




922




149




890




4




Consumer



5




21




131




18




58





Total charge offs



897




1,668




1,421




1,375




1,307



Recoveries:























Commercial financial and agricultural



19




2




-




1




45




Real estate - construction



99




37




97




180




8




Real estate - mortgage:



101




46




14




10




4




Consumer



-




11




20




2




1





Total recoveries



219




96




131




193




58




Net charge-offs



678




1,572




1,290




1,182




1,249




Provision for loan losses



2,405




2,759




2,748




2,438




2,314




Ending balance


$

37,356



$

35,629



$

34,442



$

32,984



$

31,728





























Reserve for loan losses to total loans



1.04

%



1.06

%



1.09

%



1.08

%



1.08

%



Reserve for loan losses to total average
























loans



1.07

%



1.10

%



1.11

%



1.10

%



1.09

%



Net charge-offs to total average loans



0.08

%



0.19

%



0.17

%



0.16

%



0.17

%



Provision for loan losses to total average
























loans



0.28

%



0.34

%



0.35

%



0.33

%



0.32

%



Nonperforming assets:
























Nonaccrual loans


$

8,361



$

9,125



$

16,078



$

13,193



$

9,084





Loans 90+ days past due and accruing



553




925




1,190




-




110





Other real estate owned and
























   repossessed assets



8,638




6,840




6,940




6,739




9,752




Total


$

17,552



$

16,890



$

24,208



$

19,932



$

18,946





























Nonperforming loans to total loans



0.25

%



0.30

%



0.55

%



0.43

%



0.31

%



Nonperforming assets to total assets



0.40

%



0.41

%



0.61

%



0.53

%



0.53

%



Nonperforming assets to earning assets



0.41

%



0.42

%



0.62

%



0.54

%



0.55

%



Reserve for loan losses to nonaccrual loans



446.79

%



390.45

%



214.22

%



250.01

%



349.27

%




























Restructured accruing loans


$

8,280



$

8,295



$

2,067



$

7,030



$

9,411





























Restructured accruing loans to total loans



0.23

%



0.25

%



0.07

%



0.23

%



0.32

%




















TROUBLED DEBT RESTRUCTURINGS (TDRs)









(In thousands)



























1st Quarter
2015


4th Quarter
2014


3rd Quarter
2014


2nd Quarter
2014


1st Quarter
2014


Beginning balance:


$

8,992



$

7,932



$

9,217



$

13,478



$

14,168




Additions



-




6,250




-




1,409




-




Net (paydowns) / advances



(381)




(4,492)




(802)




(5,080)




235




Charge-offs



(331)




(698)




(483)




(590)




(925)








$

8,280



$

8,992



$

7,932



$

9,217



$

13,478



 


CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)



(In thousands except per share data)







1st Quarter
2015


4th Quarter
2014


3rd Quarter
2014


2nd Quarter
2014


1st Quarter
2014

Interest income:

















Interest and fees on loans


$

38,646


$

35,902


$

34,662


$

33,250


$

32,252


Taxable securities



1,128



1,143



1,131



1,126



1,097


Nontaxable securities



860



871



877



870



871


Federal funds sold



77



41



38



43



42


Other interest and dividends



72



206



149



135



19


   Total interest income



40,783



38,163



36,857



35,424



34,281

Interest expense:

















Deposits



3,270



3,256



3,123



3,027



3,014


Borrowed funds



476



447



415



419



418


   Total interest expense



3,746



3,703



3,538



3,446



3,432


   Net interest income



37,037



34,460



33,319



31,978



30,849

Provision for loan losses



2,405



2,759



2,748



2,438



2,314


   Net interest income after provision for loan losses



34,632



31,701



30,571



29,540



28,535

Non-interest income:

















Service charges on deposit accounts



1,207



1,168



1,172



1,057



868


Mortgage banking



454



507



582



674



284


Securities gains



29



-



3



-



-


Increase in cash surrender value life insurance



648



649



549



546



536


Other operating income



739



786



700



661



487


   Total non-interest income



3,077



3,110



3,006



2,938



2,175

Non-interest expense:

















Salaries and employee benefits



9,008



6,332



7,890



9,098



7,697


Equipment and occupancy expense



1,661



1,335



1,437



1,409



1,366


Professional services



568



558



829



532



516


FDIC and other regulatory assessments



620



516



533



528



517


Other real estate owned expense



214



528



220



298



487


Merger expense



2,096



-



-



-



-


Other operating expense



4,584



3,874



4,406



3,552



3,140


   Total non-interest expense



18,751



13,142



15,315



15,417



13,723


   Income before income tax



18,958



21,668



18,262



17,061



16,987

Provision for income tax



5,903



6,636



4,260



5,476



5,229


       Net income



13,055



15,032



14,002



11,585



11,758


Dividends on preferred stock



100



115



100



116



100


         Net income available to common stockholders


$

12,955


$

14,917


$

13,902


$

11,469


$

11,658

Basic earnings per common share


$

0.51


$

0.60


$

0.56


$

0.49


$

0.53

Diluted earnings per common share


$

0.49


$

0.58


$

0.54


$

0.46


$

0.51

 

AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS - UNAUDITED


ON A FULLY TAXABLE-EQUIVALENT BASIS


(Dollars in thousands)














































1st Quarter 2015


4th Quarter 2014



3rd Quarter 2014


2nd Quarter 2014


1st Quarter 2014








Average Balance


Yield / Rate


Average Balance


Yield / Rate


Average Balance


Yield / Rate


Average Balance


Yield / Rate


Average Balance


Yield / Rate


Assets:
































Interest-earning assets:

































Loans, net of unearned income (1) (4)


































Taxable


$

3,492,363


4.47

%


$

3,215,400


4.41

%


$

3,081,435


4.44

%


$

2,978,631


4.46

%


$

2,892,433


4.52

%




Tax-exempt (2)



10,180


5.03




10,367


4.98




12,043


4.95




15,803


3.24




14,550


3.30




Mortgage loans held for sale



6,884


2.12




3,410


6.05




6,861


3.64




8,048


3.24




4,496


2.80




Debt securities:


































Taxable



198,104


2.28




195,533


2.30




195,220


2.29




188,148


2.40




174,842


2.54





Tax-exempt (2)



129,525


4.02




127,909


4.16




126,512


4.05




123,897


4.11




122,686


4.13






Total securities (3)



327,629


2.97




323,442


3.03




321,732


2.98




312,045


3.08




297,528


3.20




Federal funds sold



39,438


0.27




68,640


0.24




57,625


0.27




41,388


0.37




54,895


0.31




Restricted equity securities



4,354


3.63




3,418


3.95




3,418


3.83




3,446


7.57




3,738


-




Interest-bearing balances with banks



119,195


0.28




273,496


0.26




185,716


0.25




121,532


0.25




82,279


0.09




Total interest-earning assets



4,000,043


4.18

%



3,898,173


3.94

%



3,668,830


4.03

%



3,480,893


4.13

%



3,349,919


4.21

%


Non-interest-earning assets:

































Cash and due from banks



61,911






58,973






58,340






57,387






56,082






Net premises and equipment



13,847






8,315






8,310






8,377






8,724






Allowance for loan losses,


































accrued interest and


































other assets



117,612






101,831






86,901






88,849






85,532








Total assets


$

4,193,413





$

4,067,292





$

3,822,381





$

3,635,506





$

3,500,257









































Interest-bearing liabilities:

































Interest-bearing deposits:

































Checking


$

553,569


0.26

%


$

511,451


0.26

%


$

484,291


0.26

%


$

482,115


0.27

%


$

478,678


0.27

%



Savings



36,128


0.28




28,806


0.29




26,584


0.28




25,406


0.28




25,081


0.27




Money market



1,618,715


0.44




1,645,533


0.45




1,555,091


0.44




1,472,346


0.44




1,416,645


0.45




Time deposits (5)



446,084


1.05




395,598


1.03




394,158


1.05




402,613


1.08




412,622


1.10




Federal funds purchased



270,549


0.28




231,135


0.28




187,629


0.28




195,809


0.28




195,967


0.28




Other borrowings



20,455


5.67




19,969


5.62




19,961


5.62




19,953


5.69




19,945


5.75




Total interest-bearing liabilities



2,945,500


0.52

%



2,832,492


0.52

%



2,667,714


0.53

%



2,598,242


0.53

%



2,548,938


0.55

%


Non-interest-bearing liabilities:

































Non-interest-bearing


































demand



813,340






823,738






751,831






675,098






641,450






Other liabilities



6,745






9,969






15,838






16,158






4,724






Stockholders' equity



422,847






395,981






382,025






341,120






300,512






Unrealized gains on securities and


































derivatives



4,981






5,112






4,973






4,888






4,634








Total liabilities and




































stockholders' equity


$

4,193,413





$

4,067,292





$

3,822,381





$

3,635,506





$

3,500,257





Net interest spread





3.67

%





3.42

%





3.51

%





3.60

%





3.67

%


Net interest margin





3.80

%





3.56

%





3.65

%





3.74

%





3.80

%






































(1)

Average loans include loans on which the accrual of interest has been discontinued.


(2)

Interest income and yields are presented on a fully taxable equivalent basis using a tax rate of 35%.


(3)

Unrealized gains on available-for-sale debt securities are excluded from the yield calculation.


(4)

Interest income in the first quarter of 2015 includes $369,000 of accretion on acquired loan discounts.


(5)

Interest expense in the first quarter of 2015 includes $63,000 of accretion on acquired CD premiums.


 

SOURCE ServisFirst Bancshares, Inc.


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