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News~ State Bank Financial Corporation reports Q1 2017 financial results

2017-06-16 02:03 [BANK] Source:Netword
Guide:State Bank financial Corporation, the holding company of State Bank and Trust Company which has a Marietta location announced unaudited Financial resul

State Bank financial Corporation, the holding company of State Bank and Trust Company — which has a Marietta location — announced unaudited Financial results for the first quarter ending March 31.

Net income for Q1 2017 was $11.6 million, compared to $10.3 million in Q4 2016 and $10.8 million in Q1 2016. Fully diluted earnings per share were 30 cents in Q1 2017 compared to 28 cents in Q4 2016 and 29 cents in Q1 2016. The first quarter of 2017 included $2.2 million of merger-related expenses, which reduced earnings per share by approximately four cents in the quarter, net of tax.

“We are off to a fast start in 2017 as we kicked off the year by welcoming two New banks,” said Joe Evans, chairman and CEO. “Our New teams combined with solid performance throughout the existing franchise to generate net income of $11.6 million in the first quarter.  Quick integration of the acquisitions should drive even better performance in future quarters as the merger and integration costs decline.”

Operating highlights

Interest income on loans, excluding accretion income on loans, improved to $34.1 million in Q1 2017, a $7.4 million increase from Q4 2016 and a $9.7 million increase from Q1 2016. Net interest income of $44 million in Q1 2017 increased from $39.1 million in Q4 2016 and $36.6 million in Q1 2016. Accretion income on loans was $7.7 million in Q1 2017, down from $10.3 million in Q4 2016 and $9.7 million in Q1 2016 as there were no loan pool closings in Q1 2017. As of March 31, 2017, approximately $63 million of accretable discount remains to be recognized as loan accretion income.

Noninterest income was $9.5 million in Q1 2017, compared to $9.9 million in Q4 2016 and $9.4 million in Q1 2016. A solid quarter for mortgage banking helped offset lower SBA income in Q1 2017. Mortgage banking income increased $383,000 from the previous quarter to $2.9 million, while payroll and insurance income declined $33,000 to $1.5 million. SBA income declined $540,000 to $1.2 million in Q1 2017 primarily due to timing of loan sales as well as rebuilding the loan pipeline after a strong Q4 in 2016.

Total noninterest expense, which was impacted by the recent acquisitions of The National Bank of Georgia and S Bank, totaled $34.6 million in Q1 2017, compared to $32.9 million in Q4 2016 and $28.9 million in Q1 2016. The National Bank of Georgia and S Bank added approximately $2.6 million of total noninterest expense in Q1 2017, as the full conversion and integration was not completed until midway through Q1 2017. Additionally, $2.2 million of merger-related expenses were recorded in Q1 2017.

financial Condition

Total assets at March 31, were $4.20 billion, down from $4.23 billion at Dec. 31, 2016. Total loans were $2.9 billion at March 31, up $40.2 million from Q4 2016. Period-end organic and purchased non-credit impaired loans increased to $2.7 billion at March 31, a net increase of $46.7 million from Q4 2016.  Purchased credit impaired loans decreased to $154.2 million at the end of Q1 2017, a $6.5 million linked-quarter decline.

“We had 7 percent annualized loan growth in the first quarter, driven by organic loan growth of nearly 16 percent annualized, all while remaining disciplined with regards to risk and pricing,” said Tom Wiley, vice chairman/president. “We also successfully converted and integrated two New banks into State Bank’s systems in February, and I could not be more pleased with how well-planned and minimally disruptive the integration process was for our clients. I am very optimistic about future growth in our markets, particularly the tremendous opportunities in our New markets.”

The organic loan portfolio continued to perform well in Q1 2017 as past due organic

loans represented .08 percent of total organic loans. The provision for loan losses on organic loans was $1.3 million in Q1 2017 and was primarily attributable to organic loan growth in the quarter. The allowance as a percent of loans was unchanged at 1.01 percent at the end of Q1 2017 and covers organic nonperforming assets by more than three times.

Total deposits at March 31, were $3.41 billion, down $21.4 million from $3.43 billion at Dec. 31, 2016. In Q1 2017, a decline of $104.1 million in period-end transaction accounts, which are comprised of noninterest-bearing demand deposits and interest-bearing transaction accounts, was partially offset by a $100.8 million increase in savings and money market accounts. The changes in deposit balances were related to the seasonal cash operating cycle of State Bank’s clients. Noninterest-bearing demand deposits represented 27.7 percent of total deposits as of March 31. 

Tangible book value per share was $13.66 at the end of Q1 2017. State Bank financial Corporation continues to be well capitalized, ending the quarter with a leverage ratio of 13.04 percent and a Tier I risk-based capital ratio of 14.74 percent.

Conference Call

Evans, Wiley, chief Financial officer Sheila Ray and chief credit officer David Black discussed Financial and business results for the quarter on a conference call. A replay of the conference call will be available in the Investors section on the company’s website at   A slide presentation for the call is also available.


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