BIRMINGHAM, Ala., July 20, 2020(GLOBE NEWSWIRE)– ServisFirst Bancshares, Inc. (NASDAQ: SFBS), today announced profits and running results for the three and 6 months ended June 30, 2020.
Second Quarter 2020 Highlights:Diluted EPS for the 2nd quarter increased 14% to $0.75 year over yearTape-record deposit development of $1.5 billion throughout the second quarterFunded approximately 4,800 Payroll Defense Program (“PPP”) loans amounting to over $1.0 billion, with 68% less than $150,000 in sizeAsset quality enhanced, with nonperforming loans to total loans enhancing to 26 basis points throughout the second quarterTotal properties go beyond $11.0 billionIN-DEPTH FINANCIALSServisFirst Bancshares, Inc. reported earnings and net income offered to typical stockholders of $40.4 million for the quarter ended June 30, 2020, compared to net income and net income offered to typical investors of $35.6 million for the same quarter in 2019. Standard and diluted profits per common share were $0.75 and $0.75, respectively, for the 2nd quarter of 2020, compared to $0.67 and $0.66, respectively, for the 2nd quarter of 2019.Annualized return typically assets was 1.55% and annualized return typically typical shareholders’ equity was 18.40% for the 2nd quarter of 2020, compared to 1.69% and 18.72%, respectively, for the 2nd quarter of 2019.Net interest earnings was $83.2 million for the second quarter of 2020, compared to $77.6 million for the very first quarter of 2020 and $70.1 million for the second quarter of 2019. The net interest margin in the 2nd quarter of 2020 was 3.32% compared to 3.58% in the first quarter of 2020 and 3.44% in the 2nd quarter of 2019. Origination of PPP loans and increased excess liquidity drove undesirable rate and mix modifications while lower deposit rates and increases in noninterest bearing demand balances drove beneficial rate and mix modifications, respectively. Accretion of net fees on PPP loans of $2.6 million throughout the 2nd quarter of 2020 offset the reduction in loan yield by around 12 basis points.Average loans for the second quarter of 2020 were$8.33 billion, an increase of$972.6 million, or 52% annualized, over average loans of$7.36 billion for the very first quarter of 2020, and a boost of $1.54 billion, or 23 %, over average loans of $6.79 billion for the second quarter of 2019. We stemmed over 4,800 PPP loans during the 2nd quarter of 2020 for a total of$ 1.05 billion. Typical total balances of PPP loans for the 2nd quarter of 2020 were$885.5 million. Omitting PPP loans, average loans for the 2nd quarter of 2020 were$7.45 billion, a boost of $87.0 million over typical loans for the first quarter of 2020, and an increase of $659.1 million, or 10 %, over typical loans for the 2nd quarter of 2019. Average overall deposits for the 2nd quarter of 2020 were$8.87 billion, an increase of $1.23billion, or 64% annualized, over average overall deposits of$7.64 billion for the first quarter of 2020, and a boost of $1.69 billion, or 24 %, over typical overall deposits of$ 7.18 billion for the second quarter of 2019. Nonperforming assets to total assets were 0.26% for the 2nd quarter of 2020,a reduction of 18 basis points compared to 0.44% for the first quarter of 2020 and a decline of 17 basis points compared to 0.43% for the second quarter of 2019. Annualized net charge-offs to typical loans were 0.20%, a 6 basis-point reduction compared to 0.26%for the very first quarter of 2020 and a decline of two basis points compared to 0.22% for the 2nd quarter of 2019. We taped a$10.3 million provision for loan losses in the 2nd quarter of 2020 compared to$13.6 million in the very first quarter of 2020 and $4.9 million in the 2nd quarter of 2019. The allowance for loan loss as a percentage of overall loans was 1.10 %at June 30, 2020, a decrease of 3 basis points compared to 1.13% at March 31, 2020 and a boost of 8 basis points compared to 1.02% at June 30, 2019. Omitting PPP loans, the allowance for loan loss as a portion of total loans was 1.26%at June 30, 2020. The CARES Act, entered law on March 27, 2020 as an outcome of the COVID-19 break out, allows business to delay their adoption of Accounting Standards Update(ASU )2016-13, Measurement of Credit Losses on Financial Instruments (CECL), consisting of the present predicted credit losses methodology for approximating allowances for credit losses. We have chosen to postpone adoption of ASU 2016-13 up until the date on which the nationwide emergency situation concerning the COVID-19 outbreak terminates or December 31, 2020, with an efficient retrospective application date of January 1, 2020. In management’s opinion, the allowance is appropriate and was identified by consistent application of ServisFirst Bank’s method for calculating its allowance for loan losses.Noninterest income for the second quarter of 2020 increased$1.2 million, or 22%, to$7.0 million from$5.8 million in the second quarter of 2019. Home mortgage banking earnings increased$1.0 million, or 94%, from the 2nd quarter of 2019 to the 2nd quarter of 2020. Mortgage loan origination volumes increased around 65%throughout the second quarter of 2020 when compared to the same quarter in 2019. In addition, more of the originations in 2020 were sellable loans, driving greater gains on sale. Credit card income reduced$ 343,000, or 20%, to $1.4 million throughout the 2nd quarter of 2020, compared to$ 1.7 million during the 2nd quarter of 2019. The amount of spend on purchase cards increased $20.5 million while the amount of invest in business credit cards decreased $14.3 million throughout the 2nd quarter of 2020 when compared to the second quarter of 2019. Purchase card invest carries lower profit margins than credit cards due to their greater rebates. Income on life insurance policies increased$686,000, or 88%, to $1.5 million during the second quarter of 2020, compared to $778,000 throughout the 2nd quarter of 2019. We acquired an additional$75.0 million in BOLI agreements throughout the 3rd quarter of 2019. Other earnings for the second quarter of 2020 decreased$ 151,000, or 39%, to$ 241,000 from $392,000 in the second quarter of 2019. On May 4, 2020 we bought a rates of interest cap with a regard to three years and a notional amount of$300 million. The cap is tied to one-month LIBOR with a strike rate of 0.50%. We wrote down the worth of the cap by$ 252,000 during the second quarter of 2020 through other earnings and are amortizing the charge paid to our counterparty over the life of the cap.Noninterest expenditure for the second quarter of 2020 increased $2.8 million, or 11%, to $28.8 million from$26.0 million in the second quarter of 2019, and increased$ 896,000, or 3%, on a linked quarter basis. Salary and benefit expenditure for the 2nd quarter of 2020 increased $1.5 million, or 10%, to $15.8 million from$14.3 million in the 2nd quarter of 2019, and increased$ 134,000, or 1%, on a linked quarter basis. Expenses to originate PPP loans amounting to$ 2.4 million were incurred during the second quarter of 2020. These costs were credited against income and advantages as a deferred cost and will be amortized over the life of the loans by netting them against accretion of postponed origination charges. Bonus offers of roughly$2.5 million were paid during the second quarter of 2020 related to work carried out on the PPP. Extra rewards of$71,000 were paid to front-line workers who continued to assist consumers throughout the peak of the pandemic. Equipment and tenancy expenditure increased$147,000, or 6%, to $2.4 million in the 2nd quarter of 2020, from$2.3 million in the second quarter of 2019. Third party processing expenses increased $ 789,000, or 29%, to $3.5 million in the second quarter of 2020, from$2.7 million in the 2nd quarter of 2019. Limited-term licenses were contributed to our loan origination systems to enable more staff members to assist consumers with their PPP loans. These licenses added $514,000 to third celebration processing expenses throughout the second quarter of 2020. Expert services expense reduced $100,000, or 8 %, to$ 1.1 million in the second quarter of 2020, from $1.2 million in the second quarter of 2019, and increased$143,000, or 15 %, from$948,000 on a linked-quarter basis. FDIC and other regulative assessments reduced$486,000, or 45 %, to$595,000 in the 2nd quarter of 2020, from$1.1 million in the second quarter of 2019. Lower development in properties during the second quarter of 2020, omitting PPP loans, led to us adjusting our accrual for evaluations to be paid at the end of the third quarter of 2020. Expenditures connected with other property owned increased$1.1 million to $1.3 million in the second quarter of 2020, from $212,000 in the second quarter of 2019. Upgraded appraisals led to write-downs in worths on 2 properties in our Birmingham, Alabama market. Other operating costs for the second quarter of 2020 reduced$ 100,000, or 2%, to $4.1 million from$4.2 million in the second quarter of 2019, and increased $452,000, or 12 %, on a linked-quarter basis. The performance ratio was 31.92%throughout the 2nd quarter of 2020 compared to 34.30 %during the 2nd quarter of 2019 and compared to 33.11%throughout the very first quarter of 2020. Income tax cost increased $1.4 million, or 15 %, to $10.7 million in the 2nd quarter of 2020, compared to $9.3 million in the 2nd quarter of 2019. Our reliable tax rate was 20.95 % for the second quarter of 2020 compared to 20.74% for the 2nd quarter of 2019. State of Alabama tax credit financial investments developed at the end of 2019, causing our state credit amounts to reduce from$497,000 throughout the second quarter of 2019 to $132,000 throughout the 2nd quarter of 2020. We recognized a reduction in arrangement for income taxes arising from excess tax benefits from the exercise and vesting of stock alternatives and restricted stock during the second quarters of 2020 and 2019 of$136,000 and$186,000, respectively.GAAP Reconciliation and Management Explanation of Non-GAAP Financial Steps This press release contains certain non-GAAP monetary procedures, consisting of tangible common stockholders’equity, total concrete assets, concrete book worth per share and concrete common equity to overall tangible possessions, each of which leaves out goodwill and core deposit intangibles related to our acquisition of City Bancshares, Inc. in January 2015.We believe these non-GAAP financial measures provide helpful information to management and investors that is extra to our financial condition, outcomes of operations and money streams calculated in accordance with GAAP; nevertheless, we acknowledge that these non-GAAP financial steps have a number of limitations. As such, you need to not view these disclosures as a replacement for results figured out in accordance with GAAP, and they are not necessarily equivalent to non-GAAP monetary steps that other business, including those in our industry, use. The following reconciliation table provides a more in-depth analysis of the non-GAAP financial measures since and for the comparative periods provided in this news release. Dollars are in thousands, other than share and per share data.About ServisFirst Bancshares, Inc.ServisFirst Bancshares, Inc. is a bank holding business based in Birmingham, Alabama. Through its subsidiary ServisFirst Bank, ServisFirst Bancshares, Inc. offers company and personal financial services from locations in Birmingham, Huntsville, Montgomery, Mobile and Dothan, Alabama, Pensacola, Sarasota and Tampa Bay, Florida, Atlanta, Georgia, Charleston, South Carolina and Nashville, Tennessee.ServisFirst Bancshares, Inc. files routine reports with the U.S. Securities and Exchange Commission( SEC). Copies of its filings might be gotten through the SEC’s site at www.sec.gov or at www.servisfirstbancshares.com. Statements in this news release that are not historical truths, including,however not restricted to, statements worrying future operations, results or efficiency, are thus recognized as”forward-looking declarations “for the purpose of the safe harbor offered byArea 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. The words”believe,””anticipate,””prepare for,””job,””plan,””plan,””will,””could,””would,””might”and similar expressions typically symbolize positive declarations. Such declarations involve fundamentaldangers anduncertainties. ServisFirst Bancshares, Inc. cautions that such forward-looking statements, anywhere they take place in this press release or in other statements attributable to ServisFirst Bancshares, Inc., are always estimates showing the judgment of ServisFirst Bancshares, Inc.’s senior management and include a variety of risks and unpredictabilities that might trigger actual outcomes to differ materially from those recommended by the forward-looking declarations. Such forward-looking declarations should, for that reason, be considered because of various elements that could impact the precision of such positive declarations, consisting of, however not restricted to: the worldwide health and recession sped up by the COVID-19 outbreak; basic financial conditions, especially in the credit markets and in the Southeast; the efficiency of the capital markets; modifications in rates of interest, yield curves and rates of interest spread out relationships; modifications in accounting and tax principles, policies or standards; changes in legislation or regulative requirements; modifications in our loan portfolio and the deposit base; economic crisis and associated credit problems in industries most affected by the COVID-19 break out, including however not limited to, the restaurant, hospitality and retail sectors; possible modifications in laws and policies and governmental monetary and financial policies, consisting of, however not limited to, financial stimulus initiatives; the cost and other results of legal and administrative cases and comparable contingencies; possible changes in the creditworthiness of consumers and the possible problems of the collectability of loans and the value of collateral; the impact of natural catastrophes, such as typhoons and tornados, in our geographic markets; and increased competition from both banks and non-bank banks. The foregoing list of aspects is not extensive. For conversation of these and other threats that may trigger real results to differ from expectations, please describe”Cautionary Note Regarding Positive Statements”and “Threat Aspects”in our most recent Yearly Report on Type 10-K, in our Quarterly Reports on Kind 10-Q for 2020, and our other SEC filings. If one or more of the elements affecting our forward-looking information and declarations shows inaccurate, then our real results, performance or accomplishments might differ materially from those expressed in, or indicated by, forward-looking info and statements included herein. Appropriately, you should not place unnecessary dependence on any forward-looking declarations, which speak only as of the date made. ServisFirst Bancshares, Inc. presumes no responsibility to upgrade or modify any positive declarations that are made from time to time.More info about ServisFirst Bancshares, Inc. may be gotten over the Internet at www.servisfirstbancshares.com or by calling( 205)949-0302. Contact: ServisFirst Bank Davis Mange(205) 949-3420 email@example.com!.?.!Source: globenewswire.com