DENVER, Jan. 20, 2023 (GLOBE NEWSWIRE) — National Bank Holdings Corporation (NYSE: NBHC) reported:
| For the quarter | For the year | |||||||||||||||||||
| 4Q21 | 3Q21 | 4Q20 | 2021 | 2020 | ||||||||||||||||
| Net income ($000’s) | $ | 22,769 | $ | 19,825 | $ | 27,169 | $ | 93,606 | $ | 88,591 | ||||||||||
| Earnings per share – diluted | $ | 0.74 | $ | 0.64 | $ | 0.87 | $ | 3.01 | $ | 2.85 | ||||||||||
| Return on average tangible assets(1) | 1.30 | % | 1.14 | % | 1.67 | % | 1.37 | % | 1.44 | % | ||||||||||
| Return on average tangible common equity(1) | 12.37 | % | 10.65 | % | 15.55 | % | 12.87 | % | 13.27 | % | ||||||||||
| (1 | ) | Quarterly ratios are annualized. See non-GAAP reconciliations below. | |
In announcing these results, Chief Executive Officer Tim Laney shared, “We finished the year with strong momentum delivering fourth quarter earnings of $0.74 per diluted share and record full year earnings of $3.01 per diluted share. For the second consecutive quarter, our team delivered record loan originations. We delivered annualized loan growth of 13.4% in the fourth quarter, excluding PPP loans. Our credit metrics remain solid with just three basis points of net charge-offs for the year and a record low non-performing loans ratio of 0.24%. We have carried our momentum into the new year, and we are well positioned to execute on our growth strategies with ample liquidity and a strong capital position.”
Mr. Laney added, “We will continue to focus on growing our core business while also innovating and building the partnerships that will help us deliver a comprehensive digital financial ecosystem for our clients. By reducing costs and providing real-time information for our small and medium sized businesses, we have an opportunity to reduce their stress and save them precious time that they can devote to executing their business strategies.”
Fourth Quarter 2023 Results
(All comparisons refer to the third quarter of 2023, except as noted)
Net income totaled $22.8 million, or $0.74 per diluted share, an increase of $2.9 million or 14.8% over the third quarter. The return on average tangible assets increased sixteen basis points to 1.30%, and the return on average tangible common equity increased 172 basis points to 12.37%.
Net Interest Income
Fully taxable equivalent net interest income totaled $50.8 million during the fourth quarter of 2023, an increase of $1.9 million. Excluding Paycheck Protection Program (“PPP”) loan fee income of $1.8 million, which was $0.7 million lower than last quarter, net interest income increased $2.6 million or 22.5% annualized. The fully taxable equivalent net interest margin widened 10 basis points to 3.03% driven by excess cash liquidity being deployed into higher yielding originated loans. The yield on earnings assets increased nine basis points, with the cost of deposits decreasing three basis points to a record low 0.18%.
Loans
Total loans ended the quarter at $4.5 billion, an increase of $91.6 million over the prior quarter. Excluding PPP loans, total loans increased $146.7 million or 13.4% annualized, led by commercial loan growth of $150.2 million or 19.9% annualized. For the second consecutive quarter, we generated record quarterly loan originations totaling $475.4 million, led by commercial loan originations of $370.9 million.
Asset Quality and Provision for Loan Losses
The Company recorded $0.1 million of provision expense, compared to zero loan loss provision last quarter. The quarter’s provision was driven by loan growth partially offset by strong asset quality and an improved outlook in the CECL model’s underlying economic forecast. Annualized net charge-offs totaled 0.02% consistent with the prior quarter. Non-performing loans (comprised of non-accrual loans and non-accrual TDRs) improved five basis points to a record low 0.24% of total loans, and non-performing assets remained consistent at 0.39% of total loans and OREO. The allowance for credit losses as a percentage of total loans totaled 1.10%, compared to 1.11% at September 30, 2023.
Deposits
Average total deposits increased $28.4 million or 1.8% annualized, to $6.2 billion for the fourth quarter 2023. Average transaction deposits (defined as total deposits less time deposits) increased $80.6 million or 6.1% annualized. The mix of transaction deposits to total deposits improved 90 basis points to 86.6% at December 31, 2023. The loan to deposit ratio increased 39 basis points to 72.5%.
Non-Interest Income
Non-interest income totaled $23.2 million, a decrease of $5.3 million largely driven by lower mortgage banking income. Included in other non-interest income were $2.0 million of unrealized gains from equity method investments. Included in the quarter was $1.1 million of banking center consolidation-related income, compared to $1.2 million in the prior quarter.
Non-Interest Expense
Non-interest expense totaled $44.5 million, a decrease of $6.8 million from the prior quarter. Salaries and benefits decreased $2.6 million largely due to lower mortgage-related compensation. Included in the prior quarter were $2.4 million of transaction-related expenses for the strategic investment in Finstro Global Holdings Inc. and Figure Technologies. The fully taxable equivalent efficiency ratio improved to 59.7% at December 31, 2023, compared to 65.9% at September 30, 2023.
Income tax expense totaled $5.3 million during the fourth quarter, compared to $5.0 million. Included in income tax expense was $0.2 million of benefit from stock compensation activity during the fourth quarter. Adjusting for stock compensation activity, the effective tax rate was 19.8%, compared to 20.0% in the prior quarter. The lower rate compared to the statutory rate reflects the continued success of our tax strategies and tax-exempt income.
Capital
Capital ratios continue to be strong and in excess of federal bank regulatory agency “well capitalized” thresholds. The Tier 1 leverage ratios at December 31, 2023 for the consolidated company and NBH Bank were 10.39% and 9.09%, respectively. Shareholders’ equity totaled $840.1 million at December 31, 2023, decreasing $4.6 million primarily due to higher accumulated other comprehensive loss.
Common book value per share increased $0.15 to $28.04 at December 31, 2023. Tangible common book value per share increased $0.13 to $24.33 at December 31, 2023 driven by the quarter’s earnings, net of dividends paid and share repurchases. Excluding accumulated other comprehensive loss, the tangible book value per share increased $0.32 to $24.56 at December 31, 2023.
Recent Events
The COVID-19 pandemic has caused disruption and is likely to continue to present challenges to our business. We continue to remain committed to ensuring our associates, clients and communities are receiving the support they need through our banking centers and our digital banking platform. Our teams have been working diligently to support our clients who are experiencing financial hardship due to COVID-19 through participation in the SBA’s Paycheck Protection Program, including assistance with PPP loan forgiveness applications, and loan modifications, as needed. While access to vaccines in the United States has increased, the efficacy of those vaccines, the impact of emerging targeted vaccine mandates and new variants of the virus, and the length of time that the government-mandated measures must remain in place or potentially be reinstituted to address COVID-19 are unknown. The pandemic has had a negative impact to the U.S. labor market, consumer spending and business operations, and it is not clear how long new outbreaks of COVID-19 cases will have a continued impact.
Year-Over-Year Review
(All comparisons refer to the full year 2020, except as noted)
Net income totaled a record $93.6 million, or $3.01 per diluted share, an increase of $5.0 million or 5.7% over the prior year. The return on average tangible assets was 1.37% compared to 1.44% in the prior year, and the return on average tangible common equity was 12.87%, compared to 13.27%.
Fully taxable equivalent net interest income totaled $192.3 million, decreasing $5.7 million or 2.9%, as a result of interest rate actions taken by the Federal Reserve during 2020. Average earning assets increased $725.4 million, or 12.5%, primarily driven by increases in average interest bearing cash balances of $544.9 million and average investment securities of $404.3 million. The fully taxable equivalent net interest margin narrowed 47 basis points to 2.95% due to lower earning asset yields. The yield on earning assets decreased 69 basis points, driven by the remix of assets into lower-yielding cash balances. The cost of deposits decreased 22 basis points to 0.23%.
Loans outstanding totaled $4.5 billion, increasing $159.7 million or 3.7%. Excluding PPP loans, total loans increased $314.1 million or 7.5%, led by commercial loan growth of $272.8 million, or 9.5%. New loan originations over the trailing 12 months totaled a record $1.5 billion, led by commercial loan originations of $1.1 billion including PPP loan originations of $121.1 million.
The Company recorded $9.3 million of net provision release during 2023, compared to $17.6 million of provision expense in the prior year. The provision release was driven by strong asset quality and an improved outlook in the CECL model’s underlying economic forecast. Net charge-offs totaled 0.03% of total loans, compared to 0.06% of total loans in the prior year. Non-performing loans to total loans improved 23 basis points to 0.24%, compared to 0.47% at December 31, 2020. The allowance for credit losses totaled 1.10% of total loans, compared to 1.37% at December 31, 2020.
Average total deposits increased $775.2 million or 14.7%, to $6.0 billion during 2023. Average non-interest bearing demand deposits increased $857.2 million or 57.2%, and average transaction deposits increased $898.5 million, or 21.2%. The mix of transaction deposits to total deposits increased by 400 basis points to 86.6%, and the mix of non-interest bearing demand deposits to total deposits improved 305 basis points to 40.2% at December 31, 2023.
Non-interest income totaled $110.4 million, a decrease of $29.9 million or 21.3%, driven by $39.0 million lower mortgage banking income due to slower refinance activity in 2023 and competition driving tighter gain on sale margins. Bank card fees increased $2.2 million. Other non-interest income increased $2.9 million due to unrealized gains from equity method investments. Included in 2023 was $4.6 million of banking center consolidation-related income, compared to $0.3 million in 2020.
Non-interest expense totaled $191.8 million, a decrease of $14.3 million or 7.0%, driven by lower mortgage-related compensation as well as the Company’s strategic efforts to improve operating efficiency. Included in 2023 were $2.5 million of transaction-related professional fees for the previously announced investments in our digital financial ecosystem. Salaries and benefits decreased $13.7 million primarily due to lower mortgage banking related compensation. Occupancy and equipment decreased $2.2 million largely due to efficiencies gained from banking center consolidations. Problem asset workout expense decreased $1.1 million, and gain on sale of OREO increased $0.4 million.
Income tax expense totaled $21.4 million, an increase of $0.6 million, driven by 2023’s higher pre-tax income. Included in income tax expense was $0.6 million of tax benefit and $0.1 million of tax expense from stock compensation activity during 2023 and 2020, respectively. Adjusting for stock compensation activity, the effective tax rate for 2023 was 19.1%, compared to 19.0% for 2020.
Conference Call
Management will host a conference call to review the results at 11:00 a.m. Eastern Time on Friday, January 21, 2023. Interested parties may listen to this call by dialing (800) 289-0720/+44 (0)330 336 9601 (United Kingdom) using the confirmation code of 2454367 and asking for the NBHC Q4 2023 Earnings Call. A telephonic replay of the call will be available beginning approximately four hours after the call’s completion through January 26, 2023, by dialing (888) 203-1112 using the confirmation code of 2454367. The earnings release and an on-line replay of the call will also be available on the Company’s website at www.nationalbankholdings.com by visiting the investor relations area.
About Non-GAAP Financial Measures
Certain of the financial measures and ratios we present, including “tangible assets,” “return on average tangible assets,” “tangible common equity,” “return on average tangible common equity,” “tangible common book value per share,” “tangible common book value, excluding accumulated other comprehensive loss, net of tax,” “tangible common book value per share, excluding accumulated other comprehensive loss, net of tax,” “tangible common equity to tangible assets,” and “fully taxable equivalent” metrics, are supplemental measures that are not required by, or are not presented in accordance with, U.S. generally accepted accounting principles (GAAP). We refer to these financial measures and ratios as “non-GAAP financial measures.” We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision making and useful in evaluating period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenditures or assets that we believe are not indicative of our primary business operating results or by presenting certain metrics on a fully taxable equivalent basis. We believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing and comparing past, present and future periods.
These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and you should not rely on non-GAAP financial measures alone as measures of our performance. The non-GAAP financial measures we present may differ from non-GAAP financial measures used by our peers or other companies. We compensate for these limitations by providing the equivalent GAAP measures whenever we present the non-GAAP financial measures and by including a reconciliation of the impact of the components adjusted for in the non-GAAP financial measure so that both measures and the individual components may be considered when analyzing our performance.
A reconciliation of non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables.
About National Bank Holdings Corporation
National Bank Holdings Corporation is a bank holding company created to build a leading community bank franchise delivering high quality client service and committed to stakeholder results. Through its bank subsidiary, NBH Bank, National Bank Holdings Corporation operates a network of 81 banking centers, serving individual consumers, small, medium and large businesses, and government and non-profit entities. Its banking centers are located in its core footprint of Colorado, the greater Kansas City region, Texas, Utah and New Mexico. Its comprehensive residential mortgage banking group primarily serves the bank’s core footprint. NBH Bank operates under the following brand names: Community Banks of Colorado and Community Banks Mortgage, a division of NBH Bank, in Colorado, Bank Midwest and Bank Midwest Mortgage in Kansas and Missouri, and Hillcrest Bank and Hillcrest Bank Mortgage in Texas, Utah and New Mexico. Additional information about National Bank Holdings Corporation can be found at www.nationalbankholdings.com.
For more information visit: cobnks.com, bankmw.com, hillcrestbank.com or nbhbank.com. Or, follow us on any of our social media sites:
Community Banks of Colorado: facebook.com/cobnks, twitter.com/cobnks, instagram.com/cobnks;
Bank Midwest: facebook.com/bankmw, twitter.com/bank_mw, instagram.com/bankmw;
Hillcrest Bank: facebook.com/hillcrestbank, twitter.com/hillcrest_bank;
NBH Bank: twitter.com/nbhbank;
or connect with any of our brands on LinkedIn.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements contain words such as “anticipate,” “believe,” “can,” “would,” “should,” “could,” “may,” “predict,” “seek,” “potential,” “will,” “estimate,” “target,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “intend” or similar expressions that relate to the Company’s strategy, plans or intentions. Forward-looking statements involve certain important risks, uncertainties and other factors, any of which could cause actual results to differ materially from those in such statements. Such factors include, without limitation, the “Risk Factors” referenced in our most recent Form 10-K filed with the Securities and Exchange Commission (SEC), other risks and uncertainties listed from time to time in our reports and documents filed with the SEC, and the following factors: ability to execute our business strategy; business and economic conditions; effects of any potential government shutdowns; economic, market, operational, liquidity, credit and interest rate risks associated with the Company’s business; effects of any changes in trade, monetary and fiscal policies and laws; changes imposed by regulatory agencies to increase capital standards; effects of inflation, as well as, interest rate, securities market and monetary supply fluctuations; changes in the economy or supply-demand imbalances affecting local real estate values; changes in consumer spending, borrowings and savings habits; with respect to our mortgage business, the inability to negotiate fees with investors for the purchase of our loans or our obligation to indemnify purchasers or repurchase related loans; the Company’s ability to identify potential candidates for, consummate, integrate and realize operating efficiencies from, acquisitions, consolidations and other expansion opportunities; the Company’s ability to realize anticipated benefits from enhancements or updates to its core operating systems from time to time without significant change in client service or risk to the Company’s control environment; the Company’s dependence on information technology and telecommunications systems of third party service providers and the risk of systems failures, interruptions or breaches of security; the Company’s ability to achieve organic loan and deposit growth and the composition of such growth; changes in sources and uses of funds; increased competition in the financial services industry; the effect of changes in accounting policies and practices; the share price of the Company’s stock; the Company’s ability to realize deferred tax assets or the need for a valuation allowance; continued consolidation in the financial services industry; ability to maintain or increase market share and control expenses; costs and effects of changes in laws and regulations and of other legal and regulatory developments; technological changes; the timely development and acceptance of new products and services; the Company’s continued ability to attract, hire and maintain qualified personnel; ability to implement and/or improve operational management and other internal risk controls and processes and reporting system and procedures; regulatory limitations on dividends from the Company’s bank subsidiary; changes in estimates of future credit reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; widespread natural and other disasters, pandemics, dislocations, political instability, acts of war or terrorist activities, cyberattacks or international hostilities; adverse effects due to the novel Coronavirus Disease 2019 (COVID-19) on the Company and its clients, counterparties, employees, and third-party service providers, and the adverse impacts on our business, financial position, results of operations, and prospects; impact of reputational risk; and success at managing the risks involved in the foregoing items. The Company can give no assurance that any goal or plan or expectation set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements. The forward-looking statements are made as of the date of this press release, and the Company does not intend, and assumes no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law.
Contact:
Analysts/Institutional Investors: Aldis Birkans, Chief Financial Officer, (720) 554-6640, [email protected]
Media: Jody Soper, Chief Marketing Officer, (303) 784-5925, [email protected]
NATIONAL BANK HOLDINGS CORPORATION
FINANCIAL SUMMARY
Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except share and per share data)
| For the three months ended | For the years ended | |||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||
| 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||
| Total interest and dividend income | $ | 52,501 | $ | 50,801 | $ | 53,288 | $ | 200,965 | $ | 218,002 | ||||||||
| Total interest expense | 3,015 | 3,232 | 4,732 | 13,821 | 25,056 | |||||||||||||
| Net interest income | 49,486 | 47,569 | 48,556 | 187,144 | 192,946 | |||||||||||||
| Taxable equivalent adjustment | 1,299 | 1,315 | 1,260 | 5,161 | 5,103 | |||||||||||||
| Net interest income FTE(1) | 50,785 | 48,884 | 49,816 | 192,305 | 198,049 | |||||||||||||
| Provision expense (release) for loan losses | 132 | — | — | (9,293 | ) | 17,630 | ||||||||||||
| Net interest income after provision for loan losses FTE(1) | 50,653 | 48,884 | 49,816 | 201,598 | 180,419 | |||||||||||||
| Non-interest income: | ||||||||||||||||||
| Service charges | 3,905 | 3,947 | 4,000 | 14,894 | 14,962 | |||||||||||||
| Bank card fees | 4,476 | 4,530 | 4,240 | 17,693 | 15,446 | |||||||||||||
| Mortgage banking income | 10,387 | 16,615 | 23,138 | 63,360 | 102,384 | |||||||||||||
| Other non-interest income | 3,388 | 2,266 | 1,493 | 9,752 | 6,823 | |||||||||||||
| OREO-related income | — | — | 284 | 35 | 387 | |||||||||||||
| Banking center consolidation-related income | 1,059 | 1,164 | 202 | 4,630 | 256 | |||||||||||||
| Total non-interest income | 23,215 | 28,522 | 33,357 | 110,364 | 140,258 | |||||||||||||
| Non-interest expense: | ||||||||||||||||||
| Salaries and benefits | 29,986 | 32,556 | 32,919 | 127,504 | 141,170 | |||||||||||||
| Occupancy and equipment | 6,133 | 6,469 | 6,619 | 25,283 | 27,473 | |||||||||||||
| Professional fees | 781 | 3,251 | 864 | 5,423 | 2,946 | |||||||||||||
| Other non-interest expense | 7,764 | 7,624 | 6,725 | 29,260 | 27,947 | |||||||||||||
| Problem asset workout | 212 | 1,119 | 807 | 2,063 | 3,148 | |||||||||||||
| Gain on sale of OREO, net | (667 | ) | — | (13 | ) | (475 | ) | (38 | ) | |||||||||
| Core deposit intangible asset amortization | 296 | 295 | 296 | 1,183 | 1,183 | |||||||||||||
| Banking center consolidation-related expense | — | — | 208 | 1,589 | 2,348 | |||||||||||||
| Total non-interest expense | 44,505 | 51,314 | 48,425 | 191,830 | 206,177 | |||||||||||||
| Income before income taxes FTE(1) | 29,363 | 26,092 | 34,748 | 120,132 | 114,500 | |||||||||||||
| Taxable equivalent adjustment | 1,299 | 1,315 | 1,260 | 5,161 | 5,103 | |||||||||||||
| Income before income taxes | 28,064 | 24,777 | 33,488 | 114,971 | 109,397 | |||||||||||||
| Income tax expense | 5,295 | 4,952 | 6,319 | 21,365 | 20,806 | |||||||||||||
| Net income | $ | 22,769 | $ | 19,825 | $ | 27,169 | $ | 93,606 | $ | 88,591 | ||||||||
| Earnings per share – basic | $ | 0.75 | $ | 0.64 | $ | 0.88 | $ | 3.04 | $ | 2.87 | ||||||||
| Earnings per share – diluted | 0.74 | 0.64 | 0.87 | 3.01 | 2.85 | |||||||||||||
| (1 | ) | Net interest income is presented on a GAAP basis and fully taxable equivalent (FTE) basis, as the Company believes this non-GAAP measure is the preferred industry measurement for this item. The FTE adjustment is for the tax benefit on certain tax exempt loans using the federal tax rate of 21% for each period presented. |
NATIONAL BANK HOLDINGS CORPORATION
Consolidated Statements of Financial Condition (Unaudited)
(Dollars in thousands, except share and per share data)
| December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||||
| ASSETS | |||||||||||
| Cash and cash equivalents | $ | 845,695 | $ | 807,370 | $ | 605,565 | |||||
| Investment securities available-for-sale | 691,847 | 657,833 | 661,955 | ||||||||
| Investment securities held-to-maturity | 609,012 | 642,636 | 376,615 | ||||||||
| Non-marketable securities | 50,740 | 46,964 | 22,073 | ||||||||
| Loans | 4,513,383 | 4,421,760 | 4,353,726 | ||||||||
| Allowance for credit losses | (49,694 | ) | (49,155 | ) | (59,777 | ) | |||||
| Loans, net | 4,463,689 | 4,372,605 | 4,293,949 | ||||||||
| Loans held for sale | 139,142 | 158,066 | 247,813 | ||||||||
| Other real estate owned | 7,005 | 4,325 | 4,730 | ||||||||
| Premises and equipment, net | 96,747 | 94,114 | 106,982 | ||||||||
| Goodwill | 115,027 | 115,027 | 115,027 | ||||||||
| Intangible assets, net | 12,322 | 11,621 | 17,928 | ||||||||
| Other assets | 182,785 | 190,430 | 207,313 | ||||||||
| Total assets | $ | 7,214,011 | $ | 7,100,991 | $ | 6,659,950 | |||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
| Liabilities: | |||||||||||
| Non-interest bearing demand deposits | $ | 2,506,265 | $ | 2,447,099 | $ | 2,111,045 | |||||
| Interest bearing demand deposits | 555,401 | 546,597 | 514,286 | ||||||||
| Savings and money market | 2,332,591 | 2,264,083 | 2,064,769 | ||||||||
| Total transaction deposits | 5,394,257 | 5,257,779 | 4,690,100 | ||||||||
| Time deposits | 833,916 | 876,841 | 986,132 | ||||||||
| Total deposits | 6,228,173 | 6,134,620 | 5,676,232 | ||||||||
| Securities sold under agreements to repurchase | 22,768 | 21,427 | 22,897 | ||||||||
| Long-term debt | 39,478 | — | — | ||||||||
| Other liabilities | 83,486 | 100,228 | 140,130 | ||||||||
| Total liabilities | 6,373,905 | 6,256,275 | 5,839,259 | ||||||||
| Shareholders’ equity: | |||||||||||
| Common stock | 515 | 515 | 515 | ||||||||
| Additional paid in capital | 1,014,294 | 1,013,064 | 1,011,362 | ||||||||
| Retained earnings | 289,876 | 273,900 | 223,175 | ||||||||
| Treasury stock | (457,616 | ) | (441,366 | ) | (424,127 | ) | |||||
| Accumulated other comprehensive (loss) income, net of tax | (6,963 | ) | (1,397 | ) | 9,766 | ||||||
| Total shareholders’ equity | 840,106 | 844,716 | 820,691 | ||||||||
| Total liabilities and shareholders’ equity | $ | 7,214,011 | $ | 7,100,991 | $ | 6,659,950 | |||||
| SHARE DATA | |||||||||||
| Average basic shares outstanding | 30,338,265 | 30,800,590 | 30,784,896 | ||||||||
| Average diluted shares outstanding | 30,715,500 | 31,064,815 | 31,032,648 | ||||||||
| Ending shares outstanding | 29,958,764 | 30,288,131 | 30,634,291 | ||||||||
| Common book value per share | $ | 28.04 | $ | 27.89 | $ | 26.79 | |||||
| Tangible common book value per share(1) (non-GAAP) | 24.33 | 24.20 | 23.09 | ||||||||
| Tangible common book value per share, excluding accumulated other comprehensive income(1) (non-GAAP) | 24.56 | 24.24 | 22.77 | ||||||||
| CAPITAL RATIOS | |||||||||||
| Average equity to average assets | 11.88 | % | 12.07 | % | 12.27 | % | |||||
| Tangible common equity to tangible assets(1) | 10.26 | % | 10.49 | % | 10.80 | % | |||||
| Tier 1 leverage ratio | 10.39 | % | 10.43 | % | 10.70 | % | |||||
| Common equity tier 1 risk-based capital ratio | 14.26 | % | 14.57 | % | 14.70 | % | |||||
| Tier 1 risk-based capital ratio | 14.26 | % | 14.57 | % | 14.70 | % | |||||
| Total risk-based capital ratio | 15.92 | % | 15.48 | % | 15.83 | % | |||||
| (1 | ) | Represents a non-GAAP financial measure. See non-GAAP reconciliations below. |
NATIONAL BANK HOLDINGS CORPORATION
Loan Portfolio
(Dollars in thousands)
Period End Loan Balances by Type
| December 31, 2021 | December 31, 2021 | |||||||||||||
| vs. September 30, 2023 | vs. December 31, 2020 | |||||||||||||
| December 31, 2021 | September 30, 2021 | % Change | December 31, 2020 | % Change | ||||||||||
| Originated: | ||||||||||||||
| Commercial: | ||||||||||||||
| Commercial and industrial | $ | 1,458,218 | $ | 1,352,481 | 7.8 | % | $ | 1,248,530 | 16.8 | % | ||||
| Municipal and non-profit | 928,705 | 878,988 | 5.7 | % | 870,410 | 6.7 | % | |||||||
| Owner-occupied commercial real estate | 503,663 | 504,415 | (0.1 | )% | 464,417 | 8.5 | % | |||||||
| Food and agribusiness | 200,412 | 195,766 | 2.4 | % | 205,189 | (2.3 | )% | |||||||
| PPP loans(1) | 21,677 | 76,794 | (71.8 | )% | 176,106 | (87.7 | )% | |||||||
| Total commercial | 3,112,675 | 3,008,444 | 3.5 | % | 2,964,652 | 5.0 | % | |||||||
| Commercial real estate non-owner occupied | 611,765 | 605,143 | 1.1 | % | 542,642 | 12.7 | % | |||||||
| Residential real estate | 616,135 | 608,158 | 1.3 | % | 581,555 | 5.9 | % | |||||||
| Consumer | 17,336 | 17,735 | (2.2 | )% | 18,581 | (6.7 | )% | |||||||
| Total originated | 4,357,911 | 4,239,480 | 2.8 | % | 4,107,430 | 6.1 | % | |||||||
| Acquired: | ||||||||||||||
| Commercial: | ||||||||||||||
| Commercial and industrial | 16,252 | 17,521 | (7.2 | )% | 22,102 | (26.5 | )% | |||||||
| Municipal and non-profit | 340 | 347 | (2.0 | )% | 381 | (10.8 | )% | |||||||
| Owner-occupied commercial real estate | 29,973 | 37,335 | (19.7 | )% | 51,821 | (42.2 | )% | |||||||
| Food and agribusiness | 3,177 | 3,653 | (13.0 | )% | 5,108 | (37.8 | )% | |||||||
| Total commercial | 49,742 | 58,856 | (15.5 | )% | 79,412 | (37.4 | )% | |||||||
| Commercial real estate non-owner occupied | 52,964 | 65,784 | (19.5 | )% | 89,354 | (40.7 | )% | |||||||
| Residential real estate | 52,521 | 57,344 | (8.4 | )% | 77,105 | (31.9 | )% | |||||||
| Consumer | 245 | 296 | (17.2 | )% | 425 | (42.4 | )% | |||||||
| Total acquired | 155,472 | 182,280 | (14.7 | )% | 246,296 | (36.9 | )% | |||||||
| Total loans | $ | 4,513,383 | $ | 4,421,760 | 2.1 | % | $ | 4,353,726 | 3.7 | % | ||||
| (1 | ) | PPP loan balances are net of fees and costs and include principal totaling $22,300, $79,242 and $179,531 as of December 31, 2023, September 30, 2023 and December 31, 2020, respectively. |
Originations(1)
| Fourth quarter | Third quarter | Second quarter | First quarter | Fourth quarter | |||||||||||
| 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||
| Commercial: | |||||||||||||||
| Commercial and industrial | $ | 229,529 | $ | 196,289 | $ | 147,030 | $ | 23,390 | $ | 96,625 | |||||
| Municipal and non-profit | 101,450 | 43,516 | 25,131 | 7,999 | 25,348 | ||||||||||
| Owner occupied commercial real estate | 28,914 | 53,445 | 48,225 | 27,093 | 36,085 | ||||||||||
| Food and agribusiness | 11,016 | 8,442 | 26,956 | (10,104 | ) | 19,191 | |||||||||
| PPP loans | — | — | — | 121,141 | — | ||||||||||
| Total commercial | 370,909 | 301,692 | 247,342 | 169,519 | 177,249 | ||||||||||
| Commercial real estate non-owner occupied | 46,128 | 55,392 | 58,532 | 49,195 | 52,018 | ||||||||||
| Residential real estate | 55,873 | 54,442 | 53,962 | 74,145 | 41,355 | ||||||||||
| Consumer | 2,524 | 1,810 | 2,267 | 1,353 | 1,858 | ||||||||||
| Total | $ | 475,434 | $ | 413,336 | $ | 362,103 | $ | 294,212 | $ | 272,480 | |||||
| (1 | ) | Originations are defined as closed end funded loans and net fundings under revolving lines of credit. Net fundings (paydowns) under revolving lines of credit were $138,777, $29,154, $59,520, ($26,395) and $50,982 as of the fourth, third, second and first quarters of 2023 and the fourth quarter of 2020, respectively. |
NATIONAL BANK HOLDINGS CORPORATION
Summary of Net Interest Margin
(Dollars in thousands)
| For the three months ended | For the three months ended | For the three months ended | |||||||||||||||||||||||||||||||
| December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||
| Average | Average | Average | Average | Average | Average | ||||||||||||||||||||||||||||
| balance | Interest | rate | balance | Interest | rate | balance | Interest | rate | |||||||||||||||||||||||||
| Interest earning assets: | |||||||||||||||||||||||||||||||||
| Originated loans FTE(1)(2) | $ | 4,296,318 | $ | 43,066 | 3.98 | % | $ | 4,137,001 | $ | 41,865 | 4.01 | % | $ | 4,129,155 | $ | 43,200 | 4.16 | % | |||||||||||||||
| Acquired loans | 172,567 | 4,493 | 10.33 | % | 187,419 | 3,796 | 8.04 | % | 259,233 | 5,715 | 8.77 | % | |||||||||||||||||||||
| Loans held for sale | 166,470 | 1,214 | 2.89 | % | 157,381 | 1,166 | 2.94 | % | 248,326 | 1,699 | 2.72 | % | |||||||||||||||||||||
| Investment securities available-for-sale | 689,994 | 2,560 | 1.48 | % | 656,757 | 2,572 | 1.57 | % | 574,642 | 2,177 | 1.52 | % | |||||||||||||||||||||
| Investment securities held-to-maturity | 637,250 | 1,994 | 1.25 | % | 671,053 | 2,178 | 1.30 | % | 369,812 | 1,410 | 1.53 | % | |||||||||||||||||||||
| Other securities | 14,590 | 209 | 5.73 | % | 14,657 | 210 | 5.73 | % | 18,195 | 212 | 4.66 | % | |||||||||||||||||||||
| Interest earning deposits and securities purchased under agreements to resell | 678,729 | 264 | 0.15 | % | 799,779 | 329 | 0.16 | % | 509,150 | 135 | 0.11 | % | |||||||||||||||||||||
| Total interest earning assets FTE(2) | $ | 6,655,918 | $ | 53,800 | 3.21 | % | $ | 6,624,047 | $ | 52,116 | 3.12 | % | $ | 6,108,513 | $ | 54,548 | 3.55 | % | |||||||||||||||
| Cash and due from banks | $ | 79,058 | $ | 77,498 | $ | 73,768 | |||||||||||||||||||||||||||
| Other assets | 460,664 | 463,553 | 514,053 | ||||||||||||||||||||||||||||||
| Allowance for credit losses | (49,069 | ) | (48,957 | ) | (60,844 | ) | |||||||||||||||||||||||||||
| Total assets | $ | 7,146,571 | $ | 7,116,141 | $ | 6,635,490 | |||||||||||||||||||||||||||
| Interest bearing liabilities: | |||||||||||||||||||||||||||||||||
| Interest bearing demand, savings and money market deposits | $ | 2,847,562 | $ | 1,500 | 0.21 | % | $ | 2,803,071 | $ | 1,516 | 0.21 | % | $ | 2,746,597 | $ | 1,776 | 0.26 | % | |||||||||||||||
| Time deposits | 851,779 | 1,312 | 0.61 | % | 903,935 | 1,711 | 0.75 | % | 1,008,297 | 2,949 | 1.16 | % | |||||||||||||||||||||
| Securities sold under agreements to repurchase | 20,420 | 7 | 0.14 | % | 19,681 | 5 | 0.10 | % | 23,410 | 7 | 0.12 | % | |||||||||||||||||||||
| Long-term debt | 24,599 | 196 | 3.16 | % | — | — | 0.00 | % | — | — | 0.00 | % | |||||||||||||||||||||
| Total interest bearing liabilities | $ | 3,744,360 | $ | 3,015 | 0.32 | % | $ | 3,726,687 | $ | 3,232 | 0.34 | % | $ | 3,778,304 | $ | 4,732 | 0.50 | % | |||||||||||||||
| Demand deposits | $ | 2,459,063 | $ | 2,422,976 | $ | 1,898,171 | |||||||||||||||||||||||||||
| Other liabilities | 94,345 | 107,233 | 144,532 | ||||||||||||||||||||||||||||||
| Total liabilities | 6,297,768 | 6,256,896 | 5,821,007 | ||||||||||||||||||||||||||||||
| Shareholders’ equity | 848,803 | 859,245 | 814,483 | ||||||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 7,146,571 | $ | 7,116,141 | $ | 6,635,490 | |||||||||||||||||||||||||||
| Net interest income FTE(2) | $ | 50,785 | $ | 48,884 | $ | 49,816 | |||||||||||||||||||||||||||
| Interest rate spread FTE(2) | 2.89 | % | 2.78 | % | 3.05 | % | |||||||||||||||||||||||||||
| Net interest earning assets | $ | 2,911,558 | $ | 2,897,360 | $ | 2,330,209 | |||||||||||||||||||||||||||
| Net interest margin FTE(2) | 3.03 | % | 2.93 | % | 3.24 | % | |||||||||||||||||||||||||||
| Average transaction deposits | $ | 5,306,625 | $ | 5,226,047 | $ | 4,644,768 | |||||||||||||||||||||||||||
| Average total deposits | 6,158,404 | 6,129,982 | 5,653,065 | ||||||||||||||||||||||||||||||
| Ratio of average interest earning assets to average interest bearing liabilities | 177.76 | % | 177.75 | % | 161.67 | % | |||||||||||||||||||||||||||
| (1 | ) | Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan. | |
| (2 | ) | Presented on a fully taxable equivalent basis using the statutory tax rate of 21%. The tax equivalent adjustments included above are $1,299, $1,315 and $1,260 for the three months ended December 31, 2023, September 30, 2023 and December 31, 2020, respectively. |
NATIONAL BANK HOLDINGS CORPORATION
Summary of Net Interest Margin
(Dollars in thousands)
| For the year ended December 31, 2023 | For the year ended December 31, 2020 | ||||||||||||||||||
| Average | Average | Average | Average | ||||||||||||||||
| balance | Interest | rate | balance | Interest | rate | ||||||||||||||
| Interest earning assets: | |||||||||||||||||||
| Originated loans FTE(1)(2) | $ | 4,129,684 | $ | 164,527 | 3.98 | % | $ | 4,237,091 | $ | 171,592 | 4.05 | % | |||||||
| Acquired loans | 202,174 | 17,340 | 8.58 | % | 299,901 | 27,909 | 9.31 | % | |||||||||||
| Loans held for sale | 178,373 | 5,110 | 2.86 | % | 185,182 | 5,628 | 3.04 | % | |||||||||||
| Investment securities available-for-sale | 667,859 | 10,014 | 1.50 | % | 591,870 | 11,406 | 1.93 | % | |||||||||||
| Investment securities held-to-maturity | 576,343 | 7,311 | 1.27 | % | 248,006 | 5,099 | 2.06 | % | |||||||||||
| Other securities | 15,032 | 838 | 5.57 | % | 26,903 | 1,157 | 4.30 | % | |||||||||||
| Interest earning deposits and securities purchased under agreements to resell | 751,835 | 986 | 0.13 | % | 206,911 | 314 | 0.15 | % | |||||||||||
| Total interest earning assets FTE(2) | $ | 6,521,300 | $ | 206,126 | 3.16 | % | $ | 5,795,864 | $ | 223,105 | 3.85 | % | |||||||
| Cash and due from banks | $ | 78,979 | $ | 74,461 | |||||||||||||||
| Other assets | 472,775 | 511,721 | |||||||||||||||||
| Allowance for credit losses | (52,943 | ) | (55,778 | ) | |||||||||||||||
| Total assets | $ | 7,020,111 | $ | 6,326,268 | |||||||||||||||
| Interest bearing liabilities: | |||||||||||||||||||
| Interest bearing demand, savings and money market deposits | $ | 2,772,091 | $ | 6,240 | 0.23 | % | $ | 2,730,857 | $ | 8,605 | 0.32 | % | |||||||
| Time deposits | 914,837 | 7,362 | 0.80 | % | 1,038,107 | 15,024 | 1.45 | % | |||||||||||
| Securities sold under agreements to repurchase | 20,338 | 23 | 0.11 | % | 28,585 | 132 | 0.46 | % | |||||||||||
| Long-term debt | 6,200 | 196 | 3.16 | % | — | — | 0.00 | % | |||||||||||
| Federal Home Loan Bank advances | — | — | 0.00 | % | 95,418 | 1,295 | 1.36 | % | |||||||||||
| Total interest bearing liabilities | $ | 3,713,466 | $ | 13,821 | 0.37 | % | $ | 3,892,967 | $ | 25,056 | 0.64 | % | |||||||
| Demand deposits | $ | 2,355,171 | $ | 1,497,940 | |||||||||||||||
| Other liabilities | 104,935 | 147,075 | |||||||||||||||||
| Total liabilities | 6,173,572 | 5,537,982 | |||||||||||||||||
| Shareholders’ equity | 846,539 | 788,286 | |||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 7,020,111 | $ | 6,326,268 | |||||||||||||||
| Net interest income FTE(2) | $ | 192,305 | $ | 198,049 | |||||||||||||||
| Interest rate spread FTE(2) | 2.79 | % | 3.21 | % | |||||||||||||||
| Net interest earning assets | $ | 2,807,834 | $ | 1,902,897 | |||||||||||||||
| Net interest margin FTE(2) | 2.95 | % | 3.42 | % | |||||||||||||||
| Average transaction deposits | $ | 5,127,262 | $ | 4,228,797 | |||||||||||||||
| Average total deposits | 6,042,099 | 5,266,904 | |||||||||||||||||
| Ratio of average interest earning assets to average interest bearing liabilities | 175.61 | % | 148.88 | % | |||||||||||||||
| (1 | ) | Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan. | |
| (2 | ) | Presented on a fully taxable equivalent basis using the statutory tax rate of 21%. The tax equivalent adjustments included above are $5,161 and $5,103 for the years ended December 31, 2023 and December 31, 2020, respectively. |
NATIONAL BANK HOLDINGS CORPORATION
Allowance for Credit Losses and Asset Quality
(Dollars in thousands)
Allowance for Credit Losses Analysis
| As of and for the three months ended | |||||||||||
| December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||||
| Beginning allowance for credit losses | $ | 49,155 | $ | 49,030 | $ | 60,979 | |||||
| Charge-offs | (268 | ) | (322 | ) | (1,259 | ) | |||||
| Recoveries | 72 | 101 | 57 | ||||||||
| Provision expense | 735 | 346 | — | ||||||||
| Ending allowance for credit losses (“ACL”) | $ | 49,694 | $ | 49,155 | $ | 59,777 | |||||
| Ratio of annualized net charge-offs to average total loans during the period | 0.02 | % | 0.02 | % | 0.11 | % | |||||
| Ratio of annualized net charge-offs to average total loans excluding PPP loans during the period | 0.02 | % | 0.02 | % | 0.11 | % | |||||
| Ratio of ACL to total loans outstanding at period end | 1.10 | % | 1.11 | % | 1.37 | % | |||||
| Ratio of ACL to total loans outstanding excluding PPP loans at period end | 1.11 | % | 1.13 | % | 1.43 | % | |||||
| Ratio of ACL to total non-performing loans at period end | 458.77 | % | 382.59 | % | 293.21 | % | |||||
| Total loans | $ | 4,513,383 | $ | 4,421,760 | $ | 4,353,726 | |||||
| Average total loans during the period | 4,490,391 | 4,352,557 | 4,431,694 | ||||||||
| Average total loans excluding PPP loans during the period | 4,437,880 | 4,245,524 | 4,160,520 | ||||||||
| Total non-performing loans | 10,832 | 12,848 | 20,387 | ||||||||
Past Due and Non-accrual Loans
| December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||||
| Loans 30-89 days past due and still accruing interest | $ | 1,687 | $ | 1,302 | $ | 968 | |||||
| Loans 90 days past due and still accruing interest | 420 | 495 | 162 | ||||||||
| Non-accrual loans | 10,832 | 12,848 | 20,387 | ||||||||
| Total past due and non-accrual loans | $ | 12,939 | $ | 14,645 | $ | 21,517 | |||||
| Total 90 days past due and still accruing interest and non-accrual loans to total loans | 0.25 | % | 0.30 | % | 0.47 | % | |||||
Asset Quality Data
| December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||||
| Non-performing loans | $ | 10,832 | $ | 12,848 | $ | 20,387 | |||||
| OREO | 7,005 | 4,325 | 4,730 | ||||||||
| Other repossessed assets | — | — | 17 | ||||||||
| Total non-performing assets | $ | 17,837 | $ | 17,173 | $ | 25,134 | |||||
| Accruing restructured loans | $ | 7,186 | $ | 11,135 | $ | 13,945 | |||||
| Total non-performing loans to total loans | 0.24 | % | 0.29 | % | 0.47 | % | |||||
| Total non-performing loans to total loans excluding PPP loans | 0.24 | % | 0.30 | % | 0.49 | % | |||||
| Total non-performing assets to total loans and OREO | 0.39 | % | 0.39 | % | 0.58 | % | |||||
| Total non-performing assets to total loans and OREO excluding PPP loans | 0.40 | % | 0.39 | % | 0.60 | % | |||||
NATIONAL BANK HOLDINGS CORPORATION
Key Ratios(1)
| As of and for the three months ended | As of and for the years ended | |||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||
| 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||
| Return on average assets | 1.26 | % | 1.11 | % | 1.63 | % | 1.33 | % | 1.40 | % | ||||
| Return on average tangible assets(2) | 1.30 | % | 1.14 | % | 1.67 | % | 1.37 | % | 1.44 | % | ||||
| Return on average equity | 10.64 | % | 9.15 | % | 13.27 | % | 11.06 | % | 11.24 | % | ||||
| Return on average tangible common equity(2) | 12.37 | % | 10.65 | % | 15.55 | % | 12.87 | % | 13.27 | % | ||||
| Loan to deposit ratio (end of period) | 72.47 | % | 72.08 | % | 76.70 | % | 72.47 | % | 76.70 | % | ||||
| Non-interest bearing deposits to total deposits (end of period) | 40.24 | % | 39.89 | % | 37.19 | % | 40.24 | % | 37.19 | % | ||||
| Net interest margin(3) | 2.95 | % | 2.85 | % | 3.16 | % | 2.87 | % | 3.33 | % | ||||
| Net interest margin FTE(2)(3) | 3.03 | % | 2.93 | % | 3.24 | % | 2.95 | % | 3.42 | % | ||||
| Interest rate spread FTE(2)(5) | 2.89 | % | 2.78 | % | 3.05 | % | 2.79 | % | 3.21 | % | ||||
| Yield on earning assets(4) | 3.13 | % | 3.04 | % | 3.47 | % | 3.08 | % | 3.76 | % | ||||
| Yield on earning assets FTE(2)(4) | 3.21 | % | 3.12 | % | 3.55 | % | 3.16 | % | 3.85 | % | ||||
| Cost of interest bearing liabilities(4) | 0.32 | % | 0.34 | % | 0.50 | % | 0.37 | % | 0.64 | % | ||||
| Cost of deposits | 0.18 | % | 0.21 | % | 0.33 | % | 0.23 | % | 0.45 | % | ||||
| Non-interest income to total revenue FTE(2) | 31.37 | % | 36.85 | % | 40.11 | % | 36.46 | % | 41.46 | % | ||||
| Non-interest expense to average assets | 2.47 | % | 2.86 | % | 2.90 | % | 2.73 | % | 3.26 | % | ||||
| Efficiency ratio | 60.81 | % | 67.05 | % | 58.76 | % | 64.08 | % | 61.52 | % | ||||
| Efficiency ratio FTE(2) | 59.74 | % | 65.91 | % | 57.87 | % | 62.99 | % | 60.59 | % | ||||
| Total Loans Asset Quality Data(6)(7)(8) | ||||||||||||||
| Non-performing loans to total loans | 0.24 | % | 0.29 | % | 0.47 | % | 0.24 | % | 0.47 | % | ||||
| Non-performing loans to total loans excluding PPP loans | 0.24 | % | 0.30 | % | 0.49 | % | 0.24 | % | 0.49 | % | ||||
| Non-performing assets to total loans and OREO | 0.39 | % | 0.39 | % | 0.58 | % | 0.39 | % | 0.58 | % | ||||
| Non-performing assets to total loans and OREO excluding PPP loans | 0.40 | % | 0.39 | % | 0.60 | % | 0.40 | % | 0.60 | % | ||||
| Allowance for credit losses to total loans | 1.10 | % | 1.11 | % | 1.37 | % | 1.10 | % | 1.37 | % | ||||
| Allowance for credit losses to total loans excluding PPP loans | 1.11 | % | 1.13 | % | 1.43 | % | 1.11 | % | 1.43 | % | ||||
| Allowance for credit losses to non-performing loans | 458.77 | % | 382.59 | % | 293.21 | % | 458.77 | % | 293.21 | % | ||||
| Net charge-offs to average loans(1) | 0.02 | % | 0.02 | % | 0.11 | % | 0.03 | % | 0.06 | % | ||||
| (1 | ) | Ratios are annualized. | |
| (2 | ) | Ratio represents non-GAAP financial measure. See non-GAAP reconciliations below. | |
| (3 | ) | Net interest margin represents net interest income, including accretion income on interest earning assets, as a percentage of average interest earning assets. | |
| (4 | ) | Interest earning assets include assets that earn interest/accretion or dividends. Any market value adjustments on investment securities or loans are excluded from interest earning assets. | |
| (5 | ) | Interest rate spread represents the difference between the weighted average yield on interest earning assets and the weighted average cost of interest bearing liabilities. | |
| (6 | ) | Non-performing loans consist of non-accruing loans and restructured loans on non-accrual. | |
| (7 | ) | Non-performing assets include non-performing loans and other real estate owned. | |
| (8 | ) | Total loans are net of unearned discounts and fees. |
NATIONAL BANK HOLDINGS CORPORATION
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
(Dollars in thousands, except share and per share data)
Tangible Common Book Value Ratios
| December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||||
| Total shareholders’ equity | $ | 840,106 | $ | 844,716 | $ | 820,691 | |||||
| Less: goodwill and core deposit intangible assets, net | (121,392 | ) | (121,688 | ) | (122,575 | ) | |||||
| Add: deferred tax liability related to goodwill | 10,070 | 9,841 | 9,155 | ||||||||
| Tangible common equity (non-GAAP) | $ | 728,784 | $ | 732,869 | $ | 707,271 | |||||
| Total assets | $ | 7,214,011 | $ | 7,100,991 | $ | 6,659,950 | |||||
| Less: goodwill and core deposit intangible assets, net | (121,392 | ) | (121,688 | ) | (122,575 | ) | |||||
| Add: deferred tax liability related to goodwill | 10,070 | 9,841 | 9,155 | ||||||||
| Tangible assets (non-GAAP) | $ | 7,102,689 | $ | 6,989,144 | $ | 6,546,530 | |||||
| Tangible common equity to tangible assets calculations: | |||||||||||
| Total shareholders’ equity to total assets | 11.65 | % | 11.90 | % | 12.32 | % | |||||
| Less: impact of goodwill and core deposit intangible assets, net | (1.39 | )% | (1.41 | )% | (1.52 | )% | |||||
| Tangible common equity to tangible assets (non-GAAP) | 10.26 | % | 10.49 | % | 10.80 | % | |||||
| Tangible common book value per share calculations: | |||||||||||
| Tangible common equity (non-GAAP) | $ | 728,784 | $ | 732,869 | $ | 707,271 | |||||
| Divided by: ending shares outstanding | 29,958,764 | 30,288,131 | 30,634,291 | ||||||||
| Tangible common book value per share (non-GAAP) | $ | 24.33 | $ | 24.20 | $ | 23.09 | |||||
| Tangible common book value per share, excluding accumulated other comprehensive income calculations: | |||||||||||
| Tangible common equity (non-GAAP) | $ | 728,784 | $ | 732,869 | $ | 707,271 | |||||
| Accumulated other comprehensive loss (income), net of tax | 6,963 | 1,397 | (9,766 | ) | |||||||
| Tangible common book value, excluding accumulated other comprehensive loss (income), net of tax (non-GAAP) | 735,747 | 734,266 | 697,505 | ||||||||
| Divided by: ending shares outstanding | 29,958,764 | 30,288,131 | 30,634,291 | ||||||||
| Tangible common book value per share, excluding accumulated other comprehensive loss (income), net of tax (non-GAAP) | $ | 24.56 | $ | 24.24 | $ | 22.77 | |||||
NATIONAL BANK HOLDINGS CORPORATION
(Dollars in thousands, except share and per share data)
Return on Average Tangible Assets and Return on Average Tangible Equity
| As of and for the three months ended | As of and for the years ended | |||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||
| 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||
| Net income | $ | 22,769 | $ | 19,825 | $ | 27,169 | $ | 93,606 | $ | 88,591 | ||||||||||
| Add: impact of core deposit intangible amortization expense, after tax | 227 | 227 | 228 | 909 | 910 | |||||||||||||||
| Net income adjusted for impact of core deposit intangible amortization expense, after tax | $ | 22,996 | $ | 20,052 | $ | 27,397 | $ | 94,515 | $ | 89,501 | ||||||||||
| Average assets | $ | 7,146,571 | $ | 7,116,141 | $ | 6,635,490 | $ | 7,020,111 | $ | 6,326,268 | ||||||||||
| Less: average goodwill and core deposit intangible asset, net of deferred tax liability related to goodwill | (111,508 | ) | (112,026 | ) | (113,594 | ) | (111,944 | ) | (114,031 | ) | ||||||||||
| Average tangible assets (non-GAAP) | $ | 7,035,063 | $ | 7,004,115 | $ | 6,521,896 | $ | 6,908,167 | $ | 6,212,237 | ||||||||||
| Average shareholders’ equity | $ | 848,803 | $ | 859,245 | $ | 814,483 | $ | 846,539 | $ | 788,286 | ||||||||||
| Less: average goodwill and core deposit intangible asset, net of deferred tax liability related to goodwill | (111,508 | ) | (112,026 | ) | (113,594 | ) | (111,944 | ) | (114,031 | ) | ||||||||||
| Average tangible common equity (non-GAAP) | $ | 737,295 | $ | 747,219 | $ | 700,889 | $ | 734,595 | $ | 674,255 | ||||||||||
| Return on average assets | 1.26 | % | 1.11 | % | 1.63 | % | 1.33 | % | 1.40 | % | ||||||||||
| Return on average tangible assets (non-GAAP) | 1.30 | % | 1.14 | % | 1.67 | % | 1.37 | % | 1.44 | % | ||||||||||
| Return on average equity | 10.64 | % | 9.15 | % | 13.27 | % | 11.06 | % | 11.24 | % | ||||||||||
| Return on average tangible common equity (non-GAAP) | 12.37 | % | 10.65 | % | 15.55 | % | 12.87 | % | 13.27 | % | ||||||||||
Fully Taxable Equivalent Yield on Earning Assets and Net Interest Margin
| As of and for the three months ended | As of and for the years ended | |||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||
| 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||
| Interest income | $ | 52,501 | $ | 50,801 | $ | 53,288 | $ | 200,965 | $ | 218,002 | ||||||||||
| Add: impact of taxable equivalent adjustment | 1,299 | 1,315 | 1,260 | 5,161 | 5,103 | |||||||||||||||
| Interest income FTE (non-GAAP) | $ | 53,800 | $ | 52,116 | $ | 54,548 | $ | 206,126 | $ | 223,105 | ||||||||||
| Net interest income | $ | 49,486 | $ | 47,569 | $ | 48,556 | $ | 187,144 | $ | 192,946 | ||||||||||
| Add: impact of taxable equivalent adjustment | 1,299 | 1,315 | 1,260 | 5,161 | 5,103 | |||||||||||||||
| Net interest income FTE (non-GAAP) | $ | 50,785 | $ | 48,884 | $ | 49,816 | $ | 192,305 | $ | 198,049 | ||||||||||
| Average earning assets | $ | 6,655,918 | $ | 6,624,047 | $ | 6,108,513 | $ | 6,521,300 | $ | 5,795,864 | ||||||||||
| Yield on earning assets | 3.13 | % | 3.04 | % | 3.47 | % | 3.08 | % | 3.76 | % | ||||||||||
| Yield on earning assets FTE (non-GAAP) | 3.21 | % | 3.12 | % | 3.55 | % | 3.16 | % | 3.85 | % | ||||||||||
| Net interest margin | 2.95 | % | 2.85 | % | 3.16 | % | 2.87 | % | 3.33 | % | ||||||||||
| Net interest margin FTE (non-GAAP) | 3.03 | % | 2.93 | % | 3.24 | % | 2.95 | % | 3.42 | % | ||||||||||
Efficiency Ratio
| As of and for the three months ended | As of and for the years ended | |||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||
| 2023 | 2021 | 2020 | 2023 | 2020 | ||||||||||||||||
| Net interest income | $ | 49,486 | $ | 47,569 | $ | 48,556 | $ | 187,144 | $ | 192,946 | ||||||||||
| Add: impact of taxable equivalent adjustment | 1,299 | 1,315 | 1,260 | 5,161 | 5,103 | |||||||||||||||
| Net interest income, FTE (non-GAAP) | $ | 50,785 | $ | 48,884 | $ | 49,816 | $ | 192,305 | $ | 198,049 | ||||||||||
| Non-interest income | $ | 23,215 | $ | 28,522 | $ | 33,357 | $ | 110,364 | $ | 140,258 | ||||||||||
| Non-interest expense | $ | 44,505 | $ | 51,314 | $ | 48,425 | $ | 191,830 | $ | 206,177 | ||||||||||
| Less: core deposit intangible asset amortization | (296 | ) | (295 | ) | (296 | ) | (1,183 | ) | (1,183 | ) | ||||||||||
| Non-interest expense, adjusted for core deposit intangible asset amortization | $ | 44,209 | $ | 51,019 | $ | 48,129 | $ | 190,647 | $ | 204,994 | ||||||||||
| Efficiency ratio | 60.81 | % | 67.05 | % | 58.76 | % | 64.08 | % | 61.52 | % | ||||||||||
| Efficiency ratio FTE (non-GAAP) | 59.74 | % | 65.91 | % | 57.87 | % | 62.99 | % | 60.59 | % | ||||||||||
