UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 25, 2023
SIMMONS FIRST NATIONAL CORPORATION
(Exact name of registrant as specified in its charter)
Arkansas | 0-6253 | 71-0407808 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
501 Main Street, Pine Bluff, Arkansas | 71601 | |
(Address of principal executive offices) | (Zip Code) |
(870) 541-1000
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common stock, par value $0.01 per share | SFNC | The Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 | Results of Operations and Financial Condition. |
On April 25, 2023, the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information provided pursuant to this Item 2.02, including Exhibit 99.1, is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (“Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Registrant under the Securities Act of 1933 (“Securities Act”) or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 7.01 | Regulation FD Disclosure. |
On April 25, 2023, the Registrant issued an investor presentation, a copy of which is attached hereto as Exhibit 99.2 and is incorporated herein by reference.
The information provided pursuant to this Item 7.01, including Exhibit 99.2, is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Registrant under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01 | Financial Statements and Exhibits. |
Exhibit 99.1 | Press Release dated April 25, 2023 | |
Exhibit 99.2 | Investor Presentation issued on April 25, 2023 | |
Exhibit 104 | Cover Page Interactive Data File (embedded within the Inline XBRL Document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
SIMMONS FIRST NATIONAL CORPORATION | |
/s/ James M. Brogdon | |
Date: April 25, 2023 | James M. Brogdon, President and Chief Financial Officer |
Exhibit 99.1
April 25, 2023
Simmons First National Corporation Reports First Quarter 2023 Results
Bob Fehlman, Simmons’ Chief Executive Officer, commented on first quarter 2023 results |
While the continued challenges from rising interest rates, coupled this quarter with heightened market volatility, brought amplified attention to the financial services industry, our focus remained on the fundamentals that have served us well during our 120-year history.
Deposit levels were stable, further highlighting the granularity of our deposit base, as well as the long-term relationships we have with many of our customers. Consistent with industry trends, we experienced migration to higher rate deposits throughout the quarter, resulting in an increase in the cost of deposits. Despite these challenges, we continued to operate from a position of strength given our solid liquidity position. Uninsured deposits represented only 23 percent of total deposits. At $10.8 billion, additional liquidity sources available to the company represented 2.0 times the level of uninsured deposits. Capital levels increased with all regulatory capital ratios significantly above “well-capitalized” guidelines, and our TCE ratio ended the quarter at 7.3 percent. Key credit quality metrics also remained strong with our NPL coverage ratio at 324 percent and our allowance to loan ratio at 1.25 percent.
Overall expenses were well contained in the quarter. Through our Better Bank Initiative, we have identified an estimated $15 million in annual noninterest expense cost savings that we expect to be fully incorporated into our run-rate by the end of 2023. The programs under this initiative are designed to optimize operational processes, further improve the customer experience and increase our capacity to capitalize on organic growth opportunities, while at the same time improving our long-term growth profile. |
Financial Highlights | 1Q23 | 4Q22 | 1Q22 | Q1 23 Highlights | |
Balance Sheet (in millions) |
Metrics as of quarter end:
· Stable deposit levels further highlight the granularity of our deposit portfolio and long-term relationships with many customers
· Solid liquidity position with loan to deposit ratio at 74%; other borrowings unchanged at 6% of total liabilities
· Uninsured deposits represented 23% of total deposits; additional liquidity sources provide 2.0x coverage of uninsured deposits
· Disciplined loan growth as total loans increase 3% on a linked quarter basis
· Maintained strong credit quality metrics; NPL coverage ratio at 324% and allowance to loan ratio of 1.25%
· All regulatory capital ratios continue to significantly exceed “well-capitalized guidelines; TCE ratio1 at 7.3% | ||||
Total deposits | $22,452 | $22,548 | $19,392 | ||
Total loans | 16,555 | 16,142 | 12,029 | ||
Total investment securities | 7,521 | 7,613 | 8,197 | ||
Total shareholders’ equity | 3,340 | 3,269 | 2,962 | ||
Asset Quality | |||||
Net charge-off ratio | 0.03% | 0.13% | 0.22% | ||
Nonperforming loan ratio | 0.38 | 0.37 | 0.53 | ||
Nonperforming assets to total assets | 0.26 | 0.23 | 0.29 | ||
Allowance for credit losses to total loans | 1.25 | 1.22 | 1.49 | ||
Nonperforming loan coverage ratio | 324 | 334 | 278 | ||
Capital Ratios | |||||
Equity to assets | 12.11% | 11.91% | 12.10% | ||
Tangible common equity (TCE) ratio 1 | 7.25 | 7.00 | 7.37 | ||
Common equity tier 1 (CET1) ratio | 11.87 | 11.90 | 13.52 | ||
Total risk-based capital ratio | 14.47 | 14.22 | 16.42 | ||
Liquidity ($ in millions) | |||||
Loan to deposit ratio | 73.74% | 71.59% | 62.03% | ||
Borrowed funds to total liabilities | 6.32% | 5.73% | 8.91% | ||
Uninsured deposits | $ 5,268 | $ 6,740 | $5,910 | ||
Additional liquidity sources | $10,780 | $10,604 | $8,358 | ||
Coverage ratio of uninsured deposits | 2.0x | 1.6x | 1.4x | ||
Performance Measures (in millions) | |||||
Total revenue | $223.7 | $237.7 | $187.8 | ||
Pre-provision net revenue1 | 80.4 | 95.2 | 59.5 | ||
Adjusted pre-provision net revenue1 | 82.8 | 92.2 | 62.3 | ||
Provision for credit losses on loans | 10.9 | - | (19.9) | ||
Provision for credit losses on securities | 13.3 | - | - | ||
Noninterest income | 45.8 | 44.6 | 42.2 | ||
Noninterest expense | 143.2 | 142.6 | 128.4 |
P.O. BOX 7009 501 MAIN STREET PINE BLUFF, ARKANSAS 71611-7009 (870) 541-1000 www.simmonsbank.com
Simmons First National Corporation (NASDAQ: SFNC) (Simmons or Company) today reported net income of $45.6 million for the first quarter of 2023, compared to $83.3 million in the fourth quarter of 2022 and $65.1 million in the first quarter of 2022. Diluted earnings per share were $0.36 for the first quarter of 2023, compared to $0.65 in the fourth quarter of 2022 and $0.58 in the first quarter of 2022. Adjusted earnings1 for the first quarter of 2023 were $47.3 million, compared to $81.1 million in the fourth quarter of 2022 and $67.2 million in the first quarter of 2022. A summary of certain items, consisting primarily of merger related costs and branch right-sizing costs, are described in the “Reconciliation of Non-GAAP Financial Measures” tables below.
Total revenue for the first quarter of 2023 was $223.7 million, compared to $237.7 million in the fourth quarter of 2022 and $187.8 million in the first quarter of 2022. Pre-provision net revenue1 for the first quarter of 2023 was $80.4 million, compared to $95.2 million in the fourth quarter of 2022 and $59.5 million in the first quarter of 2022. Adjusted pre-provision net revenue1 was $82.8 million, compared to $92.2 million in the fourth quarter of 2022 and $62.3 million in the first quarter of 2022.
The decline in revenue and pre-provision net revenue on a linked quarter basis primarily reflected a decrease in net interest income, as an increase in deposit cost and the continued change in the mix of deposits more than offset an increase in interest income on earning assets, an increase in noninterest income and well contained noninterest expense growth. Results for the first quarter of 2023 also include a provision for credit losses of $24.2 million, reflecting loan growth in the quarter, the impact of updated economic assumptions and the identification of two nonperforming corporate bonds in the securities portfolio. During the fourth quarter of 2022, the Company did not record a provision for credit losses, and in the first quarter of 2022 recorded a recapture of provision expense of $19.9 million.
Net Interest Income
Net interest income for the first quarter of 2023 totaled $177.8 million, compared to $193.0 million for the fourth quarter of 2022 and $145.6 million for the first quarter of 2022. Included in net interest income is accretion recognized on assets acquired, which totaled $2.6 million in the first quarter of 2023, $4.5 million in the fourth quarter of 2022 and $3.7 million in the first quarter of 2022. On a linked quarter basis, interest income increased $14.6 million, while interest expense increased $29.7 million primarily as a result of the competitive interest rate environment and the corresponding migration to higher rate deposits products.
The yield on loans for the first quarter of 2023 was 5.67 percent, compared to 5.40 percent in the fourth quarter of 2022 and 4.34 percent in the first quarter of 2022. The yield on investment securities for the first quarter of 2023 was 2.92 percent, compared to 2.68 percent for the fourth quarter of 2022 and 1.86 percent for the first quarter of 2022. Cost of deposits for the first quarter of 2023 was 1.58 percent, compared to 1.02 percent for the fourth quarter of 2022 and 0.14 percent for the first quarter of 2022. The increase in the cost of deposits reflected the dramatic increase in interest rates during 2022 and the first quarter of 2023, customer migration to higher rate deposit products and increased competition for deposits. The net interest margin on a fully taxable equivalent basis for the first quarter of 2023 was 3.09 percent, compared to 3.31 percent for the fourth quarter of 2022 and 2.76 percent for the first quarter of 2022.
Q1 23 | Q4 22 | Q3 22 | Q2 22 | Q1 22 | ||||||||||||||||
Loan yield (FTE)2 | 5.67 | % | 5.40 | % | 4.86 | % | 4.54 | % | 4.34 | % | ||||||||||
Investment securities yield (FTE)2 | 2.92 | 2.68 | 2.29 | 2.08 | 1.86 | |||||||||||||||
Cost of interest bearing deposits | 2.10 | 1.41 | 0.65 | 0.25 | 0.19 | |||||||||||||||
Cost of deposits | 1.58 | 1.02 | 0.47 | 0.18 | 0.14 | |||||||||||||||
Cost of borrowed funds | 4.29 | 3.92 | 2.66 | 2.13 | 1.94 | |||||||||||||||
Net interest spread (FTE)2 | 2.52 | 2.87 | 3.11 | 3.11 | 2.66 | |||||||||||||||
Net interest margin (FTE)2 | 3.09 | 3.31 | 3.34 | 3.24 | 2.76 |
Noninterest Income
Noninterest income for the first quarter of 2023 was $45.8 million, compared to $44.6 million in the fourth quarter of 2022 and $42.2 million in the first quarter of 2022. Included in first quarter 2023 results is a $4.0 million legal reserve recapture associated with previously disclosed legal matters. The fourth quarter of 2022 included a $4.1 million gain on insurance settlement related to a weather event that caused severe damage to one of our branches. Adjusted noninterest income1 for the first quarter of 2023 was $45.8 million, compared to $40.6 million in the fourth quarter of 2022 and $42.2 million for the first quarter of 2022. The increase in adjusted noninterest income on a linked quarter basis was primarily attributable to an increase in service charges on deposit accounts and mortgage lending income and legal reserve recapture, offset by a market driven decline in wealth management fees. On a year-over-year basis, the increase in noninterest income was primarily attributable to an increase in service charges on deposit accounts, debit and credit card fees and legal reserve recapture, offset in part by a decline in mortgage lending income resulting from reduced activity throughout the housing market given the dramatic increase in interest rates.
Noninterest Income $ in millions | Q1 23 | Q4 22 | Q3 22 | Q2 22 | Q1 22 | |||||||||||||||
Service charges on deposit accounts | $ | 12.4 | $ | 11.9 | $ | 12.6 | $ | 11.4 | $ | 10.7 | ||||||||||
Wealth management fees | 7.4 | 8.2 | 8.6 | 7.2 | 8.0 | |||||||||||||||
Debit and credit card fees | 8.0 | 7.8 | 7.7 | 8.2 | 7.4 | |||||||||||||||
Mortgage lending income | 1.6 | 1.1 | 2.6 | 2.2 | 4.6 | |||||||||||||||
Other service charges and fees | 2.3 | 2.0 | 2.1 | 1.9 | 1.6 | |||||||||||||||
Bank owned life insurance | 3.0 | 3.0 | 2.9 | 2.6 | 2.7 | |||||||||||||||
Gain (loss) on sale of securities | - | (0.1 | ) | - | (0.2 | ) | (0.1 | ) | ||||||||||||
Gain on insurance settlement | - | 4.1 | - | - | - | |||||||||||||||
Other income | 11.3 | 6.6 | 6.7 | 6.8 | 7.3 | |||||||||||||||
Adjusted other income1 | 11.3 | 6.6 | 6.3 | 6.9 | 7.3 |
Noninterest Expense
Noninterest expense for the first quarter of 2023 was $143.2 million, compared to $142.6 million in the fourth quarter of 2022 and $128.4 million in the first quarter of 2022. Included in noninterest expense are certain items, primarily consisting of merger related and branch right sizing costs, totaling $2.4 million in the first quarter of 2023, $1.1 million the fourth quarter of 2022 and $2.8 million in the first quarter of 2022. Excluding these items (which are described in the “Reconciliation of Non-GAAP Financial Measures” tables below), adjusted noninterest expense1 was $140.9 million in the first quarter of 2023, $141.4 million in the fourth quarter of 2022 and $125.6 million in the first quarter of 2022. The decrease in adjusted noninterest expense on a linked quarter basis was primarily due to a decrease in other operating expenses, which in the fourth quarter of 2022 included $1.2 million related to the amortization of certain tax credits. The increase in salaries and employee benefits on a linked quarter basis reflected seasonal payroll taxes incurred during the first quarter, 401(k) profit sharing contribution and equity awards compensation. The increase in adjusted noninterest expense compared to the first quarter of 2022 primarily reflects the aforementioned items, as well as the acquisition of Spirit of Texas Bancshares, Inc. (Spirit) which closed early in the second quarter of 2022.
Noninterest Expense $ in millions | Q1 23 | Q4 22 | Q3 22 | Q2 22 | Q1 22 | |||||||||||||||
Salaries and employee benefits | $ | 77.0 | $ | 73.0 | $ | 71.9 | $ | 74.1 | $ | 67.9 | ||||||||||
Occupancy expense, net | 11.6 | 11.6 | 11.7 | 11.0 | 10.0 | |||||||||||||||
Furniture and equipment | 5.1 | 5.4 | 5.4 | 5.1 | 4.8 | |||||||||||||||
Deposit insurance | 4.9 | 3.7 | 3.3 | 2.8 | 1.8 | |||||||||||||||
Other real estate and foreclosure expense | 0.2 | 0.4 | 0.2 | 0.1 | 0.3 | |||||||||||||||
Merger related costs | 1.4 | - | 1.4 | 19.1 | 1.9 | |||||||||||||||
Other operating expenses | 43.1 | 48.5 | 45.1 | 44.5 | 41.6 | |||||||||||||||
Adjusted other operating expenses1 | 42.3 | 47.5 | 44.1 | 42.7 | 40.9 | |||||||||||||||
Efficiency ratio | 62.28 | % | 58.33 | % | 57.22 | % | 67.77 | % | 66.39 | % | ||||||||||
Adjusted efficiency ratio1 | 59.38 | % | 56.97 | % | 54.41 | % | 56.74 | % | 62.95 | % |
Loans and Unfunded Loan Commitments
Total loans at the end of the first quarter of 2023 were $16.6 billion, an increase of $413 million, or 3 percent, compared to $16.1 billion at the end of the fourth quarter of 2022. The increase in total loans was supported by diverse growth in terms of type and by geographic market. On a year-over-year basis, total loans were up $4.5 billion, or 38 percent, reflecting, in large part, the acquisition of Spirit.
Unfunded commitments at the end of the first quarter of 2023 were $4.7 billion, compared to $5.0 billion at the end of the fourth quarter of 2022 and $3.4 billion at the end of the first quarter of 2022. While unfunded commitments are considered a key indicator of future loan growth, higher interest rates, softening economic conditions and forecasts of a potential recession in the U.S. have resulted in lower activity in our commercial loan pipeline. Commercial loans approved and ready to close at the end of the first quarter of 2023 totaled $504 million and the rate on ready to close commercial loans was 7.32 percent, up 47 basis points from the rate on ready to close commercial loans at the end of the fourth quarter of 2022.
$ in millions | Q1 23 | Q4 22 | Q3 22 | Q2 22 | Q1 22 | |||||||||||||||
Total loans | $ | 16,555 | $ | 16,142 | $ | 15,607 | $ | 15,110 | $ | 12,029 | ||||||||||
Unfunded loan commitments | $ | 4,725 | $ | 5,000 | $ | 5,138 | $ | 4,473 | $ | 3,428 |
Deposits
Total deposits at the end of the first quarter of 2023 were $22.5 billion, relatively unchanged from the end of the fourth quarter of 2022, and up $3.1 billion compared to the first quarter of 2022. Noninterest bearing deposits totaled $5.5 billion at the end of the first quarter of 2023, compared to $6.0 billion at the end of the fourth quarter of 2022 and $5.2 billion at the end of the first quarter of 2022. Noninterest bearing deposits represent 24 percent of total deposits at the end of the first quarter of 2023, compared to 27 percent at the end of both the fourth quarter of 2022 and the first quarter of 2022. Interest bearing transaction accounts totaled $11.3 billion at the end of the first quarter of 2023, compared to $11.8 billion at the end of the fourth quarter of 2022 and $12.1 billion at the end of the first quarter of 2022. Time deposits totaled $5.7 billion at the end of the first quarter of 2023, compared to $4.8 billion at the end of the fourth quarter of 2022 and $2.1 billion at the end of the first quarter of 2022. The change in the mix of deposits on a linked quarter basis continued to reflect increased market competition and consumer migration toward higher rate deposits, principally certificates of deposits, given the rapid increase in interest rates that has occurred over the past year. The loan to deposit ratio ended the first quarter of 2023 at 74 percent, compared to 72 percent at the end of the fourth quarter of 2022 and 62 percent at the end of the first quarter of 2022.
$ in millions | Q1 23 | Q4 22 | Q3 22 | Q2 22 | Q1 22 | |||||||||||||||
Noninterest bearing deposits | $ | 5,489 | $ | 6,017 | $ | 6,218 | $ | 6,057 | $ | 5,224 | ||||||||||
Interest bearing transaction accounts | 11,284 | 11,763 | 12,104 | 12,816 | 12,106 | |||||||||||||||
Time deposits | 5,679 | 4,768 | 3,827 | 3,163 | 2,062 | |||||||||||||||
Total deposits | $ | 22,452 | $ | 22,548 | $ | 22,149 | $ | 22,036 | $ | 19,392 | ||||||||||
Noninterest bearing deposits to total deposits | 24 | % | 27 | % | 28 | % | 27 | % | 27 | % | ||||||||||
Total loans to total deposits | 74 | 72 | 70 | 69 | 62 |
Asset Quality
Total nonperforming loans at the end of the first quarter of 2023 were $63.7 million, compared to $58.9 million at the end of the fourth quarter of 2022 and $64.3 million at the end of the first quarter of 2022. Total nonperforming assets as a percentage of total assets were 0.26 percent at the end of the first quarter of 2023, compared to 0.23 percent at the end of the fourth quarter 2022 and 0.29 percent at the end of the first quarter of 2022. The increase in nonperforming assets on a linked quarter basis was primarily due to isolated corporate bonds in the investment securities portfolio totaling approximately $4.0 million. Net charge-offs as a percentage of average loans for the first quarter of 2023 were 3 basis points, compared to 13 basis points in the fourth quarter of 2022 and 22 basis points in the first quarter of 2022.
Provision for credit losses totaled $24.2 million
in the first quarter of 2023, compared to provision recapture of $19.9 million in the first quarter of 2022. Of the total provision for
credit losses recorded in the first quarter of 2023, approximately $10.9 million was related to loans, reflecting loan growth in the quarter,
as well as the impact of updated economic assumptions. Approximately $13.3 million of provision for credit losses was related to decreases
in the value of corporate bonds in the investment securities portfolio, including the previously noted securities classified as nonperforming
during the quarter. The allowance for credit losses on loans at the end of the first quarter of 2023 was $206.6 million, compared to $197.0
million at the end of the fourth quarter of 2022 and $178.9 million at the end of the first quarter of 2022. The nonperforming loan coverage
ratio ended the quarter at 324 percent, compared to 334 percent at the end of the fourth quarter of 2022 and 278 percent at the end of
the first quarter of 2022. The reserve for unfunded commitments totaled $41.9 million at the end of the first quarter of 2023, unchanged
from fourth quarter 2022 levels and up from $22.4 million at the end of the first quarter of 2022.
$ in millions | Q1 23 | Q4 22 | Q3 22 | Q2 22 | Q1 22 | |||||||||||||||
Allowance for credit losses on loans to total loans | 1.25 | % | 1.22 | % | 1.27 | % | 1.41 | % | 1.49 | % | ||||||||||
Allowance for credit losses on loans to nonperforming loans | 324 | 334 | 342 | 334 | 278 | |||||||||||||||
Nonperforming loans to total loans | 0.38 | 0.37 | 0.37 | 0.42 | 0.53 | |||||||||||||||
Net charge-off ratio (annualized) | 0.03 | 0.13 | - | 0.02 | 0.22 | |||||||||||||||
Net charge-off ratio YTD (annualized) | 0.03 | 0.09 | 0.07 | 0.11 | 0.22 | |||||||||||||||
Total nonperforming loans | $ | 63.7 | $ | 58.9 | $ | 57.8 | $ | 63.6 | $ | 64.3 | ||||||||||
Total other nonperforming assets | 7.7 | 3.6 | 4.7 | 6.4 | 6.6 | |||||||||||||||
Total nonperforming assets | $ | 71.4 | $ | 62.5 | $ | 62.5 | $ | 70.0 | $ | 70.9 | ||||||||||
Reserve for unfunded commitments | $ | 41.9 | $ | 41.9 | $ | 41.9 | $ | 25.9 | $ | 22.4 |
Capital
Total common stockholders’ equity at the end of the first quarter of 2023 was $3.3 billion, compared to $3.0 billion at the end of the first quarter of 2022. On a linked quarter basis, total common stockholders’ equity increased $70.5 million primarily as a result of a $46.9 million decrease in unrealized losses associated with investment securities classified as available-for-sale. Book value per share at the end of the first quarter of 2023 was $26.24, compared to $25.73 at the end of the fourth quarter of 2022 and $26.32 at the end of the first quarter of 2022. Tangible book value per share1 was $14.88 at the end of the first quarter of 2023, compared to $14.33 at the end of the fourth quarter of 2022 and $15.22 at the end of the first quarter of 2022. Stockholders’ equity to total assets at March 31, 2023, was 12.1 percent, compared to 11.9 percent at the end of the fourth quarter of 2022 and 12.1 percent at the end of the first quarter of 2022. Tangible common equity to tangible assets1 was 7.3 percent at March 31, 2023, compared to 7.0 percent at December 31, 2022, and 7.4 percent at March 31, 2022. All of Simmons’ regulatory capital ratios significantly exceed “well-capitalized” guidelines.
Q1 23 | Q4 22 | Q3 22 | Q2 22 | Q1 22 | ||||||||||||||||
Stockholders’ equity to total assets | 12.1 | % | 11.9 | % | 11.7 | % | 12.0 | % | 12.1 | % | ||||||||||
Tangible common equity to tangible assets1 | 7.3 | 7.0 | 6.7 | 7.0 | 7.4 | |||||||||||||||
Common equity tier 1 (CET1) ratio | 11.9 | 11.9 | 11.7 | 12.1 | 13.5 | |||||||||||||||
Tier 1 leverage ratio | 9.2 | 9.3 | 9.2 | 9.2 | 9.0 | |||||||||||||||
Tier 1 risk-based capital ratio | 11.9 | 11.9 | 11.7 | 12.1 | 13.5 | |||||||||||||||
Total risk-based capital ratio | 14.5 | 14.2 | 14.1 | 14.8 | 16.4 |
Share Repurchase Program and Cash Dividend
As a result of Simmons’ solid capital position and its ability to organically generate capital, the board of directors declared a cash dividend on Simmons’ Class A common stock for the second quarter of 2023 of $0.20 per share, which represents a 5 percent increase from the cash dividend paid for the same time period last year. The cash dividend is payable on July 3, 2023, to shareholders of record as of June 15, 2023. The indicated annualized cash dividend rate of $0.80 represents a ten-year compound annual growth rate of 7 percent. 2023 represents the 114th consecutive year that Simmons has paid cash dividends and the 12th consecutive year that Simmons has increased its dividend. According to research by Dividend Power, Simmons is one of only 24 U.S. publicly traded companies that have paid dividends for 100+ uninterrupted years. Simmons also earned Dividend Power’s designation as a “Dividend Contender,” a title reserved exclusively for companies that have increased their dividend for 10 to 24 consecutive years. As of April 21, 2023, Dividend Power research noted that Simmons is one of only 371 companies out of nearly 6,000 companies listed on the New York Stock Exchange and NASDAQ in 2022 to achieve this distinction.
During the first quarter of 2023, Simmons did not repurchase shares under its 2022 stock repurchase program (2022 Program). Remaining authorization under the 2022 Program as of March 31, 2023, was approximately $80 million. Market conditions and our capital needs will drive the decision regarding future stock repurchases; the timing, pricing and amount of any repurchases under the 2022 Program will be determined by Simmons’ management at its discretion; and the 2022 Program does not obligate Simmons to repurchase any common stock and may be modified, discontinued or suspended at any time without prior notice.
(1) Non-GAAP measurement. See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below
(2) FTE – fully taxable equivalent using an effective tax rate of 26.135%
(3) Effective tax rate of 26.135%
Conference Call
Management will conduct a live conference call to review this information beginning at 9:00 a.m. Central Time today, Tuesday, April 25, 2023. Interested persons can listen to this call by dialing toll-free 1-888-222-5806 (North America only) and asking for the Simmons First National Corporation conference call, conference ID 10176799. In addition, the call will be available live or in recorded version on Simmons’ website at simmonsbank.com for at least 60 days following the date of the call.
Simmons First National Corporation
Simmons First National Corporation (NASDAQ: SFNC) is a Mid-South based financial holding company that has paid cash dividends to its shareholders for 114 consecutive years. Its principal subsidiary, Simmons Bank, operates 231 branches in Arkansas, Kansas, Missouri, Oklahoma, Tennessee and Texas. Founded in 1903, Simmons Bank offers comprehensive financial solutions delivered with a client-centric approach. In 2023, Simmons Bank was recognized by Forbes as one of America’s Best Midsize Employers and among the World’s Best Banks for the fourth consecutive year. In 2022, Simmons Bank was named to Forbes’ list of "America's Best Banks" for the second consecutive year. Additional information about Simmons Bank can be found on our website at simmonsbank.com, by following @Simmons_Bank on Twitter or by visiting our newsroom.
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (GAAP). The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance. These measures adjust GAAP performance measures to, among other things, include the tax benefit associated with revenue items that are tax-exempt, as well as exclude from net income (including on a per share diluted basis), pre-tax, pre-provision earnings, net charge-offs, income available to common shareholders, non-interest income, and non-interest expense certain income and expense items attributable to merger activity (primarily including merger-related expenses and Day 2 CECL provisions), gains and/or losses on sale of branches, net branch right-sizing initiatives, loss on redemption of trust preferred securities and gain on sale of intellectual property. In addition, the Company also presents certain figures based on tangible common stockholders’ equity, tangible assets and tangible book value, which exclude goodwill and other intangible assets. The Company further presents certain figures that are exclusive of the impact of PPP loans, deposits and/or loans acquired through acquisitions, mortgage warehouse loans, and/or energy loans, or gains and/or losses on the sale of securities. The Company’s management believes that these non-GAAP financial measures are useful to investors because they, among other things, present the results of the Company’s ongoing operations without the effect of mergers or other items not central to the Company’s ongoing business, as well as normalize for tax effects, the effects of the PPP, and certain other effects. Management, therefore, believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s ongoing businesses, and management uses these non-GAAP financial measures to assess the performance of the Company’s ongoing businesses as related to prior financial periods. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.
Forward-Looking Statements
Certain statements in this press release may not be based on historical facts and should be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including, without limitation, statements made in Mr. Fehlman’s quote, may be identified by reference to future periods or by the use of forward-looking terminology, such as “believe,” “budget,” “expect,” “foresee,” “anticipate,” “intend,” “indicate,” “target,” “estimate,” “plan,” “project,” “continue,” “contemplate,” “positions,” “prospects,” “predict,” or “potential,” by future conditional verbs such as “will,” “would,” “should,” “could,” “might” or “may,” or by variations of such words or by similar expressions. These forward-looking statements include, without limitation, statements relating to Simmons’ future growth, business strategies, lending capacity and lending activity, loan demand, revenue, assets, asset quality, profitability, dividends, net interest margin, non-interest revenue, share repurchase program, acquisition strategy, digital banking initiatives, the Company’s ability to recruit and retain key employees, the estimated cost savings associated with the Company’s Better Bank Initiative, the adequacy of the allowance for credit losses, and future economic conditions and interest rates. Any forward-looking statement speaks only as of the date of this news release, and Simmons undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release. By nature, forward-looking statements are based on various assumptions and involve inherent risk and uncertainties. Various factors, including, but not limited to, changes in economic conditions, changes in credit quality, changes in interest rates and related governmental policies, changes in loan demand, changes in deposit flows, changes in real estate values, changes in the assumptions used in making the forward-looking statements, changes in the securities markets generally or the price of Simmons’ common stock specifically, and changes in information technology affecting the financial industry; changes in customer behaviors, including consumer spending, borrowing, and saving habits; the effects of the COVID-19 pandemic on, among other things, the Company’s operations, liquidity, and credit quality; general economic and market conditions; market disruptions including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, war and other military conflicts (including the ongoing military conflict between Russia and Ukraine) or other major events, or the prospect of these events; the soundness of other financial institutions and indirect exposure related to the closings of Silicon Valley Bank (SVB), Signature Bank and Silvergate Bank and their impact on the broader market through other customers, suppliers and partners (or that the conditions which resulted in the liquidity concerns with SVB, Signature Bank and Silvergate Bank may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Company has commercial or deposit relationships); increased inflation; the loss of key employees; increased competition in the markets in which the Company operates; increased unemployment; labor shortages; claims, damages, and fines related to litigation or government actions; changes in accounting principles relating to loan loss recognition (current expected credit losses); the Company’s ability to manage and successfully integrate its mergers and acquisitions and to fully realize cost savings and other benefits associated with those transactions; cyber threats, attacks or events; reliance on third parties for key services; government legislation; and other factors, many of which are beyond the control of the Company, could cause actual results to differ materially from those projected in or contemplated by the forward-looking statements. Additional information on factors that might affect the Company’s financial results is included in the Company’s Form 10-K for the year ended December 31, 2022, and other reports that the Company has filed with or furnished to the U.S. Securities and Exchange Commission (the SEC), all of which are available from the SEC on its website, www.sec.gov. In addition, there can be no guarantee that the board of directors (Board) of Simmons will approve a quarterly dividend in future quarters, and the timing, payment, and amount of future dividends (if any) is subject to, among other things, the discretion of the Board and may differ significantly from past dividends.
FOR MORE INFORMATION CONTACT:
Ed Bilek, EVP, Director of Investor and Media Relations
ed.bilek@simmonsbank.com
205.612.3378 (cell)
Simmons First National Corporation | SFNC | |||||||||||||||||||
Consolidated End of Period Balance Sheets | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and noninterest bearing balances due from banks | $ | 199,316 | $ | 200,616 | $ | 175,547 | $ | 193,473 | $ | 195,510 | ||||||||||
Interest bearing balances due from banks and federal funds sold | 325,135 | 481,506 | 503,863 | 771,374 | 1,491,507 | |||||||||||||||
Cash and cash equivalents | 524,451 | 682,122 | 679,410 | 964,847 | 1,687,017 | |||||||||||||||
Interest bearing balances due from banks - time | 795 | 795 | 1,290 | 1,535 | 1,857 | |||||||||||||||
Investment securities - held-to-maturity | 3,765,483 | 3,759,706 | 3,787,076 | 3,819,682 | 1,556,825 | |||||||||||||||
Investment securities - available-for-sale | 3,755,956 | 3,852,854 | 3,937,543 | 4,341,647 | 6,640,069 | |||||||||||||||
Mortgage loans held for sale | 4,244 | 3,486 | 12,759 | 14,437 | 18,206 | |||||||||||||||
Other loans held for sale | - | - | 2,292 | 16,375 | - | |||||||||||||||
Loans: | ||||||||||||||||||||
Loans | 16,555,098 | 16,142,124 | 15,607,135 | 15,110,344 | 12,028,593 | |||||||||||||||
Allowance for credit losses on loans | (206,557 | ) | (196,955 | ) | (197,589 | ) | (212,611 | ) | (178,924 | ) | ||||||||||
Net loans | 16,348,541 | 15,945,169 | 15,409,546 | 14,897,733 | 11,849,669 | |||||||||||||||
Premises and equipment | 564,497 | 548,741 | 549,932 | 553,062 | 486,531 | |||||||||||||||
Foreclosed assets and other real estate owned | 2,721 | 2,887 | 3,612 | 4,084 | 5,118 | |||||||||||||||
Interest receivable | 98,775 | 102,892 | 86,637 | 82,332 | 69,357 | |||||||||||||||
Bank owned life insurance | 493,191 | 491,340 | 488,364 | 486,355 | 448,011 | |||||||||||||||
Goodwill | 1,320,799 | 1,319,598 | 1,309,000 | 1,310,528 | 1,147,007 | |||||||||||||||
Other intangible assets | 124,854 | 128,951 | 133,059 | 137,285 | 102,748 | |||||||||||||||
Other assets | 579,139 | 622,520 | 675,554 | 588,707 | 469,853 | |||||||||||||||
Total assets | $ | 27,583,446 | $ | 27,461,061 | $ | 27,076,074 | $ | 27,218,609 | $ | 24,482,268 | ||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
Noninterest bearing transaction accounts | $ | 5,489,434 | $ | 6,016,651 | $ | 6,218,283 | $ | 6,057,186 | $ | 5,223,862 | ||||||||||
Interest bearing transaction accounts and savings deposits | 11,283,584 | 11,762,885 | 12,103,994 | 12,816,198 | 12,105,948 | |||||||||||||||
Time deposits | 5,678,757 | 4,768,558 | 3,826,415 | 3,162,479 | 2,062,612 | |||||||||||||||
Total deposits | 22,451,775 | 22,548,094 | 22,148,692 | 22,035,863 | 19,392,422 | |||||||||||||||
Federal funds purchased and securities sold | ||||||||||||||||||||
under agreements to repurchase | 142,862 | 160,403 | 168,513 | 155,101 | 196,828 | |||||||||||||||
Other borrowings | 1,023,826 | 859,296 | 964,772 | 1,060,244 | 1,337,243 | |||||||||||||||
Subordinated notes and debentures | 366,027 | 365,989 | 365,951 | 421,693 | 384,242 | |||||||||||||||
Accrued interest and other liabilities | 259,055 | 257,917 | 270,995 | 285,813 | 209,926 | |||||||||||||||
Total liabilities | 24,243,545 | 24,191,699 | 23,918,923 | 23,958,714 | 21,520,661 | |||||||||||||||
Stockholders' equity: | ||||||||||||||||||||
Preferred stock | - | - | - | - | - | |||||||||||||||
Common stock | 1,273 | 1,270 | 1,269 | 1,288 | 1,125 | |||||||||||||||
Surplus | 2,533,589 | 2,530,066 | 2,527,153 | 2,569,060 | 2,150,453 | |||||||||||||||
Undivided profits | 1,275,720 | 1,255,586 | 1,196,459 | 1,139,975 | 1,136,990 | |||||||||||||||
Accumulated other comprehensive (loss) income | (470,681 | ) | (517,560 | ) | (567,730 | ) | (450,428 | ) | (326,961 | ) | ||||||||||
Total stockholders' equity | 3,339,901 | 3,269,362 | 3,157,151 | 3,259,895 | 2,961,607 | |||||||||||||||
Total liabilities and stockholders' equity | $ | 27,583,446 | $ | 27,461,061 | $ | 27,076,074 | $ | 27,218,609 | $ | 24,482,268 |
Page 1 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Consolidated Statements of Income - Quarter-to-Date | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands, except per share data) | ||||||||||||||||||||
INTEREST INCOME | ||||||||||||||||||||
Loans (including fees) | $ | 227,498 | $ | 216,091 | $ | 187,347 | $ | 163,578 | $ | 127,176 | ||||||||||
Interest bearing balances due from banks and federal funds sold | 2,783 | 2,593 | 1,141 | 1,117 | 649 | |||||||||||||||
Investment securities | 48,774 | 45,689 | 40,954 | 37,848 | 33,712 | |||||||||||||||
Mortgage loans held for sale | 82 | 152 | 178 | 200 | 190 | |||||||||||||||
Other loans held for sale | - | 59 | 998 | 2,063 | - | |||||||||||||||
TOTAL INTEREST INCOME | 279,137 | 264,584 | 230,618 | 204,806 | 161,727 | |||||||||||||||
INTEREST EXPENSE | ||||||||||||||||||||
Time deposits | 39,538 | 22,434 | 8,204 | 2,875 | 2,503 | |||||||||||||||
Other deposits | 47,990 | 34,615 | 17,225 | 6,879 | 4,314 | |||||||||||||||
Federal funds purchased and securities | ||||||||||||||||||||
sold under agreements to repurchase | 323 | 449 | 305 | 119 | 68 | |||||||||||||||
Other borrowings | 8,848 | 9,263 | 6,048 | 4,844 | 4,779 | |||||||||||||||
Subordinated notes and debentures | 4,603 | 4,797 | 5,251 | 4,990 | 4,457 | |||||||||||||||
TOTAL INTEREST EXPENSE | 101,302 | 71,558 | 37,033 | 19,707 | 16,121 | |||||||||||||||
NET INTEREST INCOME | 177,835 | 193,026 | 193,585 | 185,099 | 145,606 | |||||||||||||||
PROVISION FOR CREDIT LOSSES | ||||||||||||||||||||
Provision for credit losses on loans | 10,916 | 26 | (15,897 | ) | 30,406 | (19,914 | ) | |||||||||||||
Provision for credit losses on unfunded commitments | - | - | 16,000 | 3,453 | - | |||||||||||||||
Provision for credit losses on investment securities - AFS | 12,800 | - | - | - | - | |||||||||||||||
Provision for credit losses on investment securities - HTM | 500 | - | - | - | - | |||||||||||||||
TOTAL PROVISION FOR CREDIT LOSSES | 24,216 | 26 | 103 | 33,859 | (19,914 | ) | ||||||||||||||
NET INTEREST INCOME AFTER PROVISION | ||||||||||||||||||||
FOR CREDIT LOSSES | 153,619 | 193,000 | 193,482 | 151,240 | 165,520 | |||||||||||||||
NONINTEREST INCOME | ||||||||||||||||||||
Service charges on deposit accounts | 12,437 | 11,892 | 12,560 | 11,379 | 10,696 | |||||||||||||||
Debit and credit card fees | 7,952 | 7,845 | 7,685 | 8,224 | 7,449 | |||||||||||||||
Wealth management fees | 7,365 | 8,151 | 8,562 | 7,214 | 7,968 | |||||||||||||||
Mortgage lending income | 1,570 | 1,139 | 2,593 | 2,240 | 4,550 | |||||||||||||||
Bank owned life insurance income | 2,973 | 2,975 | 2,902 | 2,563 | 2,706 | |||||||||||||||
Other service charges and fees (includes insurance income) | 2,282 | 2,023 | 2,085 | 1,871 | 1,637 | |||||||||||||||
Gain (loss) on sale of securities | - | (52 | ) | (22 | ) | (150 | ) | (54 | ) | |||||||||||
Gain on insurance settlement | - | 4,074 | - | - | - | |||||||||||||||
Other income | 11,256 | 6,600 | 6,658 | 6,837 | 7,266 | |||||||||||||||
TOTAL NONINTEREST INCOME | 45,835 | 44,647 | 43,023 | 40,178 | 42,218 | |||||||||||||||
NONINTEREST EXPENSE | ||||||||||||||||||||
Salaries and employee benefits | 77,038 | 73,018 | 71,923 | 74,135 | 67,906 | |||||||||||||||
Occupancy expense, net | 11,578 | 11,620 | 11,674 | 11,004 | 10,023 | |||||||||||||||
Furniture and equipment expense | 5,051 | 5,392 | 5,394 | 5,104 | 4,775 | |||||||||||||||
Other real estate and foreclosure expense | 186 | 350 | 168 | 142 | 343 | |||||||||||||||
Deposit insurance | 4,893 | 3,680 | 3,278 | 2,812 | 1,838 | |||||||||||||||
Merger-related costs | 1,396 | 35 | 1,422 | 19,133 | 1,886 | |||||||||||||||
Other operating expenses | 43,086 | 48,480 | 45,084 | 44,483 | 41,646 | |||||||||||||||
TOTAL NONINTEREST EXPENSE | 143,228 | 142,575 | 138,943 | 156,813 | 128,417 | |||||||||||||||
NET INCOME BEFORE INCOME TAXES | 56,226 | 95,072 | 97,562 | 34,605 | 79,321 | |||||||||||||||
Provision for income taxes | 10,637 | 11,812 | 16,959 | 7,151 | 14,226 | |||||||||||||||
NET INCOME | 45,589 | 83,260 | 80,603 | 27,454 | 65,095 | |||||||||||||||
Preferred stock dividends | - | - | - | - | - | |||||||||||||||
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ | 45,589 | $ | 83,260 | $ | 80,603 | $ | 27,454 | $ | 65,095 | ||||||||||
BASIC EARNINGS PER SHARE | $ | 0.36 | $ | 0.66 | $ | 0.63 | $ | 0.21 | $ | 0.58 | ||||||||||
DILUTED EARNINGS PER SHARE | $ | 0.36 | $ | 0.65 | $ | 0.63 | $ | 0.21 | $ | 0.58 |
Page 2 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Consolidated Risk-Based Capital | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Tier 1 capital | ||||||||||||||||||||
Stockholders' equity | $ | 3,339,901 | $ | 3,269,362 | $ | 3,157,151 | $ | 3,259,895 | $ | 2,961,607 | ||||||||||
CECL transition provision (1) | 61,746 | 92,619 | 92,619 | 92,619 | 92,619 | |||||||||||||||
Disallowed intangible assets, net of deferred tax | (1,410,141 | ) | (1,412,667 | ) | (1,416,453 | ) | (1,423,323 | ) | (1,224,691 | ) | ||||||||||
Unrealized loss (gain) on AFS securities | 470,681 | 517,560 | 567,730 | 450,428 | 326,961 | |||||||||||||||
Total Tier 1 capital | 2,462,187 | 2,466,874 | 2,401,047 | 2,379,619 | 2,156,496 | |||||||||||||||
Tier 2 capital | ||||||||||||||||||||
Subordinated notes and debentures | 366,027 | 365,989 | 365,951 | 421,693 | 384,242 | |||||||||||||||
Qualifying allowance for loan losses and | ||||||||||||||||||||
reserve for unfunded commitments | 173,077 | 115,627 | 116,257 | 114,733 | 78,057 | |||||||||||||||
Total Tier 2 capital | 539,104 | 481,616 | 482,208 | 536,426 | 462,299 | |||||||||||||||
Total risk-based capital | $ | 3,001,291 | $ | 2,948,490 | $ | 2,883,255 | $ | 2,916,045 | $ | 2,618,795 | ||||||||||
Risk weighted assets | $ | 20,748,605 | $ | 20,738,727 | $ | 20,470,918 | $ | 19,669,149 | $ | 15,953,622 | ||||||||||
Adjusted average assets for leverage ratio | $ | 26,632,691 | $ | 26,407,061 | $ | 25,986,938 | $ | 25,807,113 | $ | 23,966,206 | ||||||||||
Ratios at end of quarter | ||||||||||||||||||||
Equity to assets | 12.11 | % | 11.91 | % | 11.66 | % | 11.98 | % | 12.10 | % | ||||||||||
Tangible common equity to tangible assets (2) | 7.25 | % | 7.00 | % | 6.69 | % | 7.03 | % | 7.37 | % | ||||||||||
Common equity Tier 1 ratio (CET1) | 11.87 | % | 11.90 | % | 11.73 | % | 12.10 | % | 13.52 | % | ||||||||||
Tier 1 leverage ratio | 9.24 | % | 9.34 | % | 9.24 | % | 9.22 | % | 9.00 | % | ||||||||||
Tier 1 risk-based capital ratio | 11.87 | % | 11.90 | % | 11.73 | % | 12.10 | % | 13.52 | % | ||||||||||
Total risk-based capital ratio | 14.47 | % | 14.22 | % | 14.08 | % | 14.83 | % | 16.42 | % |
(1) The Company has elected to use the CECL transition provision allowed for in the year of adopting ASC 326.
(2) Calculations of tangible common equity to tangible assets and the reconciliations to GAAP are included in the schedules accompanying this release.
Page 3 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Consolidated Investment Securities | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Investment Securities - End of Period | ||||||||||||||||||||
Held-to-Maturity | ||||||||||||||||||||
U.S. Government agencies | $ | 451,052 | $ | 448,012 | $ | 447,400 | $ | 446,789 | $ | 232,670 | ||||||||||
Mortgage-backed securities | 1,201,418 | 1,190,781 | 1,214,882 | 1,244,713 | 112,496 | |||||||||||||||
State and political subdivisions | 1,859,970 | 1,860,992 | 1,865,203 | 1,868,924 | 1,194,459 | |||||||||||||||
Other securities | 253,043 | 259,921 | 259,591 | 259,256 | 17,200 | |||||||||||||||
Total held-to-maturity (net of credit losses) | 3,765,483 | 3,759,706 | 3,787,076 | 3,819,682 | 1,556,825 | |||||||||||||||
Available-for-Sale | ||||||||||||||||||||
U.S. Treasury | $ | 2,220 | $ | 2,197 | $ | 2,191 | $ | 1,441 | $ | - | ||||||||||
U.S. Government agencies | 181,843 | 184,279 | 188,060 | 198,333 | 333,231 | |||||||||||||||
Mortgage-backed securities | 2,433,530 | 2,542,902 | 2,670,348 | 2,963,934 | 4,166,108 | |||||||||||||||
State and political subdivisions | 895,896 | 871,074 | 822,509 | 915,255 | 1,653,694 | |||||||||||||||
Other securities | 242,467 | 252,402 | 254,435 | 262,684 | 487,036 | |||||||||||||||
Total available-for-sale (net of credit losses) | 3,755,956 | 3,852,854 | 3,937,543 | 4,341,647 | 6,640,069 | |||||||||||||||
Total investment securities (net of credit losses) | $ | 7,521,439 | $ | 7,612,560 | $ | 7,724,619 | $ | 8,161,329 | $ | 8,196,894 | ||||||||||
Fair value - HTM investment securities | $ | 3,148,976 | $ | 3,063,233 | $ | 2,984,040 | $ | 3,278,962 | $ | 1,307,058 |
Page 4 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Consolidated Loans | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Loan Portfolio - End of Period | ||||||||||||||||||||
Consumer: | ||||||||||||||||||||
Credit cards | $ | 188,590 | $ | 196,928 | $ | 192,559 | $ | 189,684 | $ | 184,372 | ||||||||||
Other consumer | 142,817 | 152,882 | 180,604 | 204,692 | 180,602 | |||||||||||||||
Total consumer | 331,407 | 349,810 | 373,163 | 394,376 | 364,974 | |||||||||||||||
Real Estate: | ||||||||||||||||||||
Construction | 2,777,122 | 2,566,649 | 2,372,294 | 2,082,688 | 1,423,445 | |||||||||||||||
Single-family residential | 2,589,831 | 2,546,115 | 2,467,008 | 2,357,942 | 2,042,978 | |||||||||||||||
Other commercial real estate | 7,520,964 | 7,468,498 | 7,249,891 | 7,082,055 | 5,762,567 | |||||||||||||||
Total real estate | 12,887,917 | 12,581,262 | 12,089,193 | 11,522,685 | 9,228,990 | |||||||||||||||
Commercial: | ||||||||||||||||||||
Commercial | 2,669,731 | 2,632,290 | 2,525,218 | 2,612,256 | 2,016,405 | |||||||||||||||
Agricultural | 220,641 | 205,623 | 263,539 | 218,743 | 150,465 | |||||||||||||||
Total commercial | 2,890,372 | 2,837,913 | 2,788,757 | 2,830,999 | 2,166,870 | |||||||||||||||
Other | 445,402 | 373,139 | 356,022 | 362,284 | 267,759 | |||||||||||||||
Total loans | $ | 16,555,098 | $ | 16,142,124 | $ | 15,607,135 | $ | 15,110,344 | $ | 12,028,593 |
Page 5 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Consolidated Allowance and Asset Quality | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Allowance for Credit Losses on Loans | ||||||||||||||||||||
Beginning balance | $ | 196,955 | $ | 197,589 | $ | 212,611 | $ | 178,924 | $ | 205,332 | ||||||||||
Day 1 PCD allowance from acquisitions: | ||||||||||||||||||||
Spirit of Texas (04/08/2022) | - | 4,523 | 1,057 | 4,043 | - | |||||||||||||||
Total Day 1 PCD allowance | - | 4,523 | 1,057 | 4,043 | - | |||||||||||||||
Loans charged off: | ||||||||||||||||||||
Credit cards | 1,076 | 1,035 | 903 | 1,004 | 920 | |||||||||||||||
Other consumer | 456 | 439 | 505 | 518 | 414 | |||||||||||||||
Real estate | 1,204 | 3,392 | 130 | 115 | 485 | |||||||||||||||
Commercial | 413 | 5,389 | 1,874 | 688 | 6,319 | |||||||||||||||
Total loans charged off | 3,149 | 10,255 | 3,412 | 2,325 | 8,138 | |||||||||||||||
Recoveries of loans previously charged off: | ||||||||||||||||||||
Credit cards | 234 | 251 | 250 | 249 | 274 | |||||||||||||||
Other consumer | 240 | 230 | 278 | 302 | 387 | |||||||||||||||
Real estate | 294 | 4,117 | 1,982 | 391 | 426 | |||||||||||||||
Commercial | 1,067 | 475 | 720 | 621 | 557 | |||||||||||||||
Total recoveries | 1,835 | 5,073 | 3,230 | 1,563 | 1,644 | |||||||||||||||
Net loans charged off | 1,314 | 5,182 | 182 | 762 | 6,494 | |||||||||||||||
Provision for credit losses on loans | 10,916 | 25 | (15,897 | ) | 30,406 | (19,914 | ) | |||||||||||||
Balance, end of quarter | $ | 206,557 | $ | 196,955 | $ | 197,589 | $ | 212,611 | $ | 178,924 | ||||||||||
Nonperforming assets | ||||||||||||||||||||
Nonperforming loans: | ||||||||||||||||||||
Nonaccrual loans | $ | 63,218 | $ | 58,434 | $ | 57,534 | $ | 62,670 | $ | 64,096 | ||||||||||
Loans past due 90 days or more | 437 | 507 | 242 | 904 | 240 | |||||||||||||||
Total nonperforming loans | 63,655 | 58,941 | 57,776 | 63,574 | 64,336 | |||||||||||||||
Other nonperforming assets: | ||||||||||||||||||||
Foreclosed assets and other real estate owned | 2,721 | 2,887 | 3,612 | 4,084 | 5,118 | |||||||||||||||
Other nonperforming assets | 5,012 | 644 | 1,146 | 2,314 | 1,479 | |||||||||||||||
Total other nonperforming assets | 7,733 | 3,531 | 4,758 | 6,398 | 6,597 | |||||||||||||||
Total nonperforming assets | $ | 71,388 | $ | 62,472 | $ | 62,534 | $ | 69,972 | $ | 70,933 | ||||||||||
Performing FDMs (modifications to borrowers | ||||||||||||||||||||
experiencing financial difficulty) | $ | 2,183 | $ | 1,849 | $ | 1,869 | $ | 2,655 | $ | 3,424 | ||||||||||
Ratios | ||||||||||||||||||||
Allowance for credit losses on loans to total loans | 1.25 | % | 1.22 | % | 1.27 | % | 1.41 | % | 1.49 | % | ||||||||||
Allowance for credit losses to nonperforming loans | 324 | % | 334 | % | 342 | % | 334 | % | 278 | % | ||||||||||
Nonperforming loans to total loans | 0.38 | % | 0.37 | % | 0.37 | % | 0.42 | % | 0.53 | % | ||||||||||
Nonperforming assets (including performing FDMs) | ||||||||||||||||||||
to total assets | 0.27 | % | 0.23 | % | 0.24 | % | 0.27 | % | 0.30 | % | ||||||||||
Nonperforming assets to total assets | 0.26 | % | 0.23 | % | 0.23 | % | 0.26 | % | 0.29 | % | ||||||||||
Annualized net charge offs to average loans (QTD) | 0.03 | % | 0.13 | % | 0.00 | % | 0.02 | % | 0.22 | % | ||||||||||
Annualized net charge offs to average loans (YTD) | 0.03 | % | 0.09 | % | 0.07 | % | 0.11 | % | 0.22 | % | ||||||||||
Annualized net credit card charge offs to | ||||||||||||||||||||
average credit card loans | 1.69 | % | 1.52 | % | 1.30 | % | 1.55 | % | 1.39 | % |
Page 6 |
Simmons First National Corporation | SFNC | |||||||||||||||||||||||||||||||||||
Consolidated - Average Balance Sheet and Net Interest Income Analysis | ||||||||||||||||||||||||||||||||||||
For the Quarters Ended | ||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||
Three
Months Ended Mar 2023 | Three
Months Ended Dec 2022 | Three
Months Ended Mar 2022 | ||||||||||||||||||||||||||||||||||
($ in thousands) | Average Balance | Income/ Expense | Yield/ Rate | Average Balance | Income/ Expense | Yield/ Rate | Average Balance | Income/ Expense | Yield/ Rate | |||||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||||||||||||
Earning assets: | ||||||||||||||||||||||||||||||||||||
Interest bearing balances due from banks | ||||||||||||||||||||||||||||||||||||
and federal funds sold | $ | 315,307 | $ | 2,783 | 3.58 | % | $ | 361,856 | $ | 2,593 | 2.84 | % | $ | 1,728,694 | $ | 649 | 0.15 | % | ||||||||||||||||||
Investment securities - taxable | 4,930,945 | 32,804 | 2.70 | % | 5,085,960 | 29,645 | 2.31 | % | 5,688,306 | 18,148 | 1.29 | % | ||||||||||||||||||||||||
Investment securities - non-taxable (FTE) | 2,624,642 | 21,522 | 3.33 | % | 2,582,050 | 22,123 | 3.40 | % | 2,844,777 | 20,937 | 2.98 | % | ||||||||||||||||||||||||
Mortgage loans held for sale | 5,470 | 82 | 6.08 | % | 8,601 | 152 | 7.01 | % | 27,633 | 190 | 2.79 | % | ||||||||||||||||||||||||
Other loans held for sale | - | - | 0.00 | % | 1,704 | 59 | 13.74 | % | - | - | 0.00 | % | ||||||||||||||||||||||||
Loans - including fees (FTE) | 16,329,761 | 228,257 | 5.67 | % | 15,929,957 | 216,782 | 5.40 | % | 11,895,805 | 127,405 | 4.34 | % | ||||||||||||||||||||||||
Total interest earning assets (FTE) | 24,206,125 | 285,448 | 4.78 | % | 23,970,128 | 271,354 | 4.49 | % | 22,185,215 | 167,329 | 3.06 | % | ||||||||||||||||||||||||
Non-earning assets | 3,282,607 | 3,210,447 | 2,640,984 | |||||||||||||||||||||||||||||||||
Total assets | $ | 27,488,732 | $ | 27,180,575 | $ | 24,826,199 | ||||||||||||||||||||||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||||||||||||||||||
Interest bearing liabilities: | ||||||||||||||||||||||||||||||||||||
Interest bearing transaction and | ||||||||||||||||||||||||||||||||||||
savings accounts | $ | 11,722,591 | $ | 47,990 | 1.66 | % | $ | 11,859,322 | $ | 34,615 | 1.16 | % | $ | 12,083,516 | $ | 4,314 | 0.14 | % | ||||||||||||||||||
Time deposits | 5,155,055 | 39,538 | 3.11 | % | 4,212,271 | 22,434 | 2.11 | % | 2,241,123 | 2,503 | 0.45 | % | ||||||||||||||||||||||||
Total interest bearing deposits | 16,877,646 | 87,528 | 2.10 | % | 16,071,593 | 57,049 | 1.41 | % | 14,324,639 | 6,817 | 0.19 | % | ||||||||||||||||||||||||
Federal funds purchased and securities | ||||||||||||||||||||||||||||||||||||
sold under agreement to repurchase | 148,673 | 323 | 0.88 | % | 178,948 | 449 | 1.00 | % | 218,186 | 68 | 0.13 | % | ||||||||||||||||||||||||
Other borrowings | 787,783 | 8,848 | 4.56 | % | 923,189 | 9,263 | 3.98 | % | 1,337,654 | 4,779 | 1.45 | % | ||||||||||||||||||||||||
Subordinated notes and debentures | 366,009 | 4,603 | 5.10 | % | 365,971 | 4,797 | 5.20 | % | 384,187 | 4,457 | 4.70 | % | ||||||||||||||||||||||||
Total interest bearing liabilities | 18,180,111 | 101,302 | 2.26 | % | 17,539,701 | 71,558 | 1.62 | % | 16,264,666 | 16,121 | 0.40 | % | ||||||||||||||||||||||||
Noninterest bearing liabilities: | ||||||||||||||||||||||||||||||||||||
Noninterest bearing deposits | 5,642,779 | 6,161,732 | 5,184,828 | |||||||||||||||||||||||||||||||||
Other liabilities | 295,191 | 264,230 | 207,597 | |||||||||||||||||||||||||||||||||
Total liabilities | 24,118,081 | 23,965,663 | 21,657,091 | |||||||||||||||||||||||||||||||||
Stockholders' equity | 3,370,651 | 3,214,912 | 3,169,108 | |||||||||||||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 27,488,732 | $ | 27,180,575 | $ | 24,826,199 | ||||||||||||||||||||||||||||||
Net interest income (FTE) | $ | 184,146 | $ | 199,796 | $ | 151,208 | ||||||||||||||||||||||||||||||
Net interest spread (FTE) | 2.52 | % | 2.87 | % | 2.66 | % | ||||||||||||||||||||||||||||||
Net interest margin (FTE) | 3.09 | % | 3.31 | % | 2.76 | % |
Page 7 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Consolidated - Selected Financial Data | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands, except share data) | ||||||||||||||||||||
QUARTER-TO-DATE | ||||||||||||||||||||
Financial Highlights - As Reported | ||||||||||||||||||||
Net Income | $ | 45,589 | $ | 83,260 | $ | 80,603 | $ | 27,454 | $ | 65,095 | ||||||||||
Diluted earnings per share | 0.36 | 0.65 | 0.63 | 0.21 | 0.58 | |||||||||||||||
Return on average assets | 0.67 | % | 1.22 | % | 1.19 | % | 0.41 | % | 1.06 | % | ||||||||||
Return on average common equity | 5.49 | % | 10.27 | % | 9.71 | % | 3.28 | % | 8.33 | % | ||||||||||
Return on tangible common equity (non-GAAP) (1) | 10.25 | % | 19.29 | % | 17.99 | % | 6.28 | % | 14.31 | % | ||||||||||
Net interest margin (FTE) | 3.09 | % | 3.31 | % | 3.34 | % | 3.24 | % | 2.76 | % | ||||||||||
Efficiency ratio (2) | 62.28 | % | 58.33 | % | 57.22 | % | 67.77 | % | 66.39 | % | ||||||||||
FTE adjustment | 6,311 | 6,770 | 6,203 | 6,096 | 5,602 | |||||||||||||||
Average diluted shares outstanding | 127,516,478 | 127,505,996 | 128,336,422 | 128,720,078 | 113,026,911 | |||||||||||||||
Shares repurchased under plan | - | - | 1,883,713 | 2,035,324 | 513,725 | |||||||||||||||
Average price of shares repurchased | - | - | 23.91 | 24.59 | 31.25 | |||||||||||||||
Cash dividends declared per common share | 0.200 | 0.190 | 0.190 | 0.190 | 0.190 | |||||||||||||||
Accretable yield on acquired loans | 2,579 | 4,473 | 5,834 | 9,898 | 3,703 | |||||||||||||||
Financial Highlights - Adjusted (non-GAAP) (1) | ||||||||||||||||||||
Adjusted earnings | $ | 47,343 | $ | 81,093 | $ | 82,281 | $ | 68,102 | $ | 67,159 | ||||||||||
Adjusted diluted earnings per share | 0.37 | 0.64 | 0.64 | 0.53 | 0.59 | |||||||||||||||
Adjusted return on average assets | 0.70 | % | 1.18 | % | 1.21 | % | 1.02 | % | 1.10 | % | ||||||||||
Adjusted return on average common equity | 5.70 | % | 10.01 | % | 9.92 | % | 8.13 | % | 8.59 | % | ||||||||||
Adjusted return on tangible common equity | 10.62 | % | 18.81 | % | 18.35 | % | 14.65 | % | 14.74 | % | ||||||||||
Adjusted efficiency ratio (2) | 59.38 | % | 56.97 | % | 54.41 | % | 56.74 | % | 62.95 | % | ||||||||||
YEAR-TO-DATE | ||||||||||||||||||||
Financial Highlights - GAAP | ||||||||||||||||||||
Net Income | $ | 45,589 | $ | 256,412 | $ | 173,152 | $ | 92,549 | $ | 65,095 | ||||||||||
Diluted earnings per share | 0.36 | 2.06 | 1.40 | 0.77 | 0.58 | |||||||||||||||
Return on average assets | 0.67 | % | 0.97 | % | 0.88 | % | 0.72 | % | 1.06 | % | ||||||||||
Return on average common equity | 5.49 | % | 7.87 | % | 7.07 | % | 5.71 | % | 8.33 | % | ||||||||||
Return on tangible common equity (non-GAAP) (1) | 10.25 | % | 14.33 | % | 12.77 | % | 10.24 | % | 14.31 | % | ||||||||||
Net interest margin (FTE) | 3.09 | % | 3.17 | % | 3.12 | % | 3.01 | % | 2.76 | % | ||||||||||
Efficiency ratio (2) | 62.28 | % | 62.14 | % | 63.54 | % | 67.14 | % | 66.39 | % | ||||||||||
FTE adjustment | 6,311 | 24,671 | 17,901 | 11,698 | 5,602 | |||||||||||||||
Average diluted shares outstanding | 127,516,478 | 124,470,184 | 123,387,503 | 120,826,798 | 113,026,911 | |||||||||||||||
Cash dividends declared per common share | 0.200 | 0.760 | 0.570 | 0.380 | 0.190 | |||||||||||||||
Financial Highlights - Adjusted (non-GAAP) (1) | ||||||||||||||||||||
Adjusted earnings | $ | 47,343 | $ | 298,635 | $ | 217,542 | $ | 135,261 | $ | 67,159 | ||||||||||
Adjusted diluted earnings per share | 0.37 | 2.40 | 1.76 | 1.12 | 0.59 | |||||||||||||||
Adjusted return on average assets | 0.70 | % | 1.13 | % | 1.11 | % | 1.06 | % | 1.10 | % | ||||||||||
Adjusted return on average common equity | 5.70 | % | 9.16 | % | 8.88 | % | 8.35 | % | 8.59 | % | ||||||||||
Adjusted return on tangible common equity | 10.62 | % | 16.59 | % | 15.89 | % | 14.70 | % | 14.74 | % | ||||||||||
Adjusted efficiency ratio (2) | 59.38 | % | 57.50 | % | 57.69 | % | 59.56 | % | 62.95 | % | ||||||||||
END OF PERIOD | ||||||||||||||||||||
Book value per share | $ | 26.24 | $ | 25.73 | $ | 24.87 | $ | 25.31 | $ | 26.32 | ||||||||||
Tangible book value per share | 14.88 | 14.33 | 13.51 | 14.07 | 15.22 | |||||||||||||||
Shares outstanding | 127,282,192 | 127,046,654 | 126,943,467 | 128,787,764 | 112,505,555 | |||||||||||||||
Full-time equivalent employees | 3,189 | 3,236 | 3,206 | 3,233 | 2,893 | |||||||||||||||
Total number of financial centers | 231 | 230 | 230 | 233 | 197 |
(1) Non-GAAP measurement that management believes aids in the understanding and discussion of results. Reconciliations to GAAP are included in the schedules accompanying this release.
(2) Efficiency ratio is noninterest expense as a percent of net interest income (fully taxable equivalent) and noninterest revenues. Adjusted efficiency ratio is noninterest expense before foreclosed property expense, amortization of intangibles and certain adjusting items as a percent of net interest income (fully taxable equivalent) and noninterest revenues, excluding gains and losses from securities transactions and certain adjusting items, and is a non-GAAP measurement.
Page 8 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Reconciliation Of Non-GAAP Financial Measures - Adjusted Earnings - Quarter-to-Date | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
(in thousands, except per share data) | ||||||||||||||||||||
QUARTER-TO-DATE | ||||||||||||||||||||
Net income available to common stockholders | $ | 45,589 | $ | 83,260 | $ | 80,603 | $ | 27,454 | $ | 65,095 | ||||||||||
Certain items: | ||||||||||||||||||||
(Gain) loss from early retirement of TruPS | - | - | 365 | - | - | |||||||||||||||
Gain on sale of intellectual property | - | - | (750 | ) | - | - | ||||||||||||||
Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
Donation to Simmons First Foundation | - | - | - | 1,738 | - | |||||||||||||||
Merger related costs | 1,396 | 35 | 1,422 | 19,133 | 1,886 | |||||||||||||||
Branch right sizing (net) | 979 | 1,104 | 1,235 | 380 | 909 | |||||||||||||||
Day 2 CECL provision | - | - | - | 33,779 | - | |||||||||||||||
Tax effect (1) | (621 | ) | 768 | (594 | ) | (14,382 | ) | (731 | ) | |||||||||||
Certain items, net of tax | 1,754 | (2,167 | ) | 1,678 | 40,648 | 2,064 | ||||||||||||||
Adjusted earnings (non-GAAP) | $ | 47,343 | $ | 81,093 | $ | 82,281 | $ | 68,102 | $ | 67,159 | ||||||||||
Diluted earnings per share | $ | 0.36 | $ | 0.65 | $ | 0.63 | $ | 0.21 | $ | 0.58 | ||||||||||
Certain items: | ||||||||||||||||||||
(Gain) loss from early retirement of TruPS | - | - | - | - | - | |||||||||||||||
Gain on sale of intellectual property | - | - | (0.01 | ) | - | - | ||||||||||||||
Gain on insurance settlement | - | (0.03 | ) | |||||||||||||||||
Donation to Simmons First Foundation | - | - | - | 0.01 | - | |||||||||||||||
Merger related costs | 0.01 | - | 0.01 | 0.15 | 0.01 | |||||||||||||||
Branch right sizing (net) | 0.01 | 0.01 | 0.01 | - | 0.01 | |||||||||||||||
Day 2 CECL provision | - | - | - | 0.27 | ||||||||||||||||
Tax effect (1) | (0.01 | ) | 0.01 | - | (0.11 | ) | (0.01 | ) | ||||||||||||
Certain items, net of tax | 0.01 | (0.01 | ) | 0.01 | 0.32 | 0.01 | ||||||||||||||
Adjusted diluted earnings per share (non-GAAP) | $ | 0.37 | $ | 0.64 | $ | 0.64 | $ | 0.53 | $ | 0.59 |
(1) Effective tax rate of 26.135%.
(1) Certain items include gain from early retirement of trust preferred securities, gain on sale of intellectual property, gain on insurance settlement, donation to Simmons First Foundation, merger related costs, branch right sizing costs and Day 2 CECL provision.
Page 9 |
Simmons First National Corporation | ||||||||||||||||||||
Reconciliation Of Non-GAAP Financial Measures - Adjusted Earnings - Year-to-Date | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
(in thousands, except per share data) | ||||||||||||||||||||
YEAR-TO-DATE | ||||||||||||||||||||
Net income available to common stockholders | $ | 45,589 | $ | 256,412 | $ | 173,152 | $ | 92,549 | $ | 65,095 | ||||||||||
Certain items: | ||||||||||||||||||||
(Gain) loss from early retirement of TruPS | - | 365 | 365 | - | - | |||||||||||||||
Gain on sale of intellectual property | - | (750 | ) | (750 | ) | - | - | |||||||||||||
Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
Donation to Simmons First Foundation | - | 1,738 | 1,738 | 1,738 | - | |||||||||||||||
Merger related costs | 1,396 | 22,476 | 22,441 | 21,019 | 1,886 | |||||||||||||||
Branch right sizing (net) | 979 | 3,628 | 2,524 | 1,289 | 909 | |||||||||||||||
Day 2 CECL provision | - | 33,779 | 33,779 | 33,779 | - | |||||||||||||||
Tax effect (1) | (621 | ) | (14,939 | ) | (15,707 | ) | (15,113 | ) | (731 | ) | ||||||||||
Certain items, net of tax | 1,754 | 42,223 | 44,390 | 42,712 | 2,064 | |||||||||||||||
Adjusted earnings (non-GAAP) | $ | 47,343 | $ | 298,635 | $ | 217,542 | $ | 135,261 | $ | 67,159 | ||||||||||
Diluted earnings per share | $ | 0.36 | $ | 2.06 | $ | 1.40 | $ | 0.77 | $ | 0.58 | ||||||||||
Certain items: | ||||||||||||||||||||
(Gain) loss from early retirement of TruPS | - | - | - | - | - | |||||||||||||||
Gain on sale of intellectual property | - | (0.01 | ) | (0.01 | ) | - | - | |||||||||||||
Gain on insurance settlement | - | (0.03 | ) | - | - | - | ||||||||||||||
Donation to Simmons First Foundation | - | 0.01 | 0.01 | 0.01 | - | |||||||||||||||
Merger related costs | 0.01 | 0.18 | 0.18 | 0.17 | 0.01 | |||||||||||||||
Branch right sizing (net) | 0.01 | 0.03 | 0.02 | 0.01 | 0.01 | |||||||||||||||
Day 2 CECL provision | - | 0.28 | 0.28 | 0.28 | ||||||||||||||||
Tax effect (1) | (0.01 | ) | (0.12 | ) | (0.12 | ) | (0.12 | ) | (0.01 | ) | ||||||||||
Certain items, net of tax | 0.01 | 0.34 | 0.36 | 0.35 | 0.01 | |||||||||||||||
Adjusted diluted earnings per share (non-GAAP) | $ | 0.37 | $ | 2.40 | $ | 1.76 | $ | 1.12 | $ | 0.59 |
(1) Effective tax rate of 26.135%.
(1) Certain items include gain from early retirement of trust preferred securities, gain on sale of intellectual property, gain on insurance settlement, donation to Simmons First Foundation, merger related costs, branch right sizing costs and Day 2 CECL provision.
Page 10 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Reconciliation Of Non-GAAP Financial Measures - End of Period | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands, except per share data) | ||||||||||||||||||||
Calculation of Tangible Common Equity and the Ratio of Tangible Common Equity to Tangible Assets | ||||||||||||||||||||
Total common stockholders' equity | $ | 3,339,901 | $ | 3,269,362 | $ | 3,157,151 | $ | 3,259,895 | $ | 2,961,607 | ||||||||||
Intangible assets: | ||||||||||||||||||||
Goodwill | (1,320,799 | ) | (1,319,598 | ) | (1,309,000 | ) | (1,310,528 | ) | (1,147,007 | ) | ||||||||||
Other intangible assets | (124,854 | ) | (128,951 | ) | (133,059 | ) | (137,285 | ) | (102,748 | ) | ||||||||||
Total intangibles | (1,445,653 | ) | (1,448,549 | ) | (1,442,059 | ) | (1,447,813 | ) | (1,249,755 | ) | ||||||||||
Tangible common stockholders' equity | $ | 1,894,248 | $ | 1,820,813 | $ | 1,715,092 | $ | 1,812,082 | $ | 1,711,852 | ||||||||||
Total assets | $ | 27,583,446 | $ | 27,461,061 | $ | 27,076,074 | $ | 27,218,609 | $ | 24,482,268 | ||||||||||
Intangible assets: | ||||||||||||||||||||
Goodwill | (1,320,799 | ) | (1,319,598 | ) | (1,309,000 | ) | (1,310,528 | ) | (1,147,007 | ) | ||||||||||
Other intangible assets | (124,854 | ) | (128,951 | ) | (133,059 | ) | (137,285 | ) | (102,748 | ) | ||||||||||
Total intangibles | (1,445,653 | ) | (1,448,549 | ) | (1,442,059 | ) | (1,447,813 | ) | (1,249,755 | ) | ||||||||||
Tangible assets | $ | 26,137,793 | $ | 26,012,512 | $ | 25,634,015 | $ | 25,770,796 | $ | 23,232,513 | ||||||||||
Ratio of common equity to assets | 12.11 | % | 11.91 | % | 11.66 | % | 11.98 | % | 12.10 | % | ||||||||||
Ratio of tangible common equity to tangible assets | 7.25 | % | 7.00 | % | 6.69 | % | 7.03 | % | 7.37 | % | ||||||||||
Calculation of Tangible Book Value per Share | ||||||||||||||||||||
Total common stockholders' equity | $ | 3,339,901 | $ | 3,269,362 | $ | 3,157,151 | $ | 3,259,895 | $ | 2,961,607 | ||||||||||
Intangible assets: | ||||||||||||||||||||
Goodwill | (1,320,799 | ) | (1,319,598 | ) | (1,309,000 | ) | (1,310,528 | ) | (1,147,007 | ) | ||||||||||
Other intangible assets | (124,854 | ) | (128,951 | ) | (133,059 | ) | (137,285 | ) | (102,748 | ) | ||||||||||
Total intangibles | (1,445,653 | ) | (1,448,549 | ) | (1,442,059 | ) | (1,447,813 | ) | (1,249,755 | ) | ||||||||||
Tangible common stockholders' equity | $ | 1,894,248 | $ | 1,820,813 | $ | 1,715,092 | $ | 1,812,082 | $ | 1,711,852 | ||||||||||
Shares of common stock outstanding | 127,282,192 | 127,046,654 | 126,943,467 | 128,787,764 | 112,505,555 | |||||||||||||||
Book value per common share | $ | 26.24 | $ | 25.73 | $ | 24.87 | $ | 25.31 | $ | 26.32 | ||||||||||
Tangible book value per common share | $ | 14.88 | $ | 14.33 | $ | 13.51 | $ | 14.07 | $ | 15.22 | ||||||||||
Calculation of Uninsured Deposit Coverage Ratio | ||||||||||||||||||||
Uninsured deposits at Simmons Bank | $ | 5,896,752 | $ | 7,267,220 | $ | 6,414,459 | ||||||||||||||
Less: Intercompany eliminations | 628,592 | 527,542 | 504,306 | |||||||||||||||||
Total uninsured deposits | $ | 5,268,160 | $ | 6,739,678 | $ | 5,910,153 | ||||||||||||||
FHLB borrowing availability | $ | 5,574,000 | $ | 5,442,000 | $ | 3,597,000 | ||||||||||||||
Unpledged securities | 3,000,000 | 3,180,000 | 4,335,000 | |||||||||||||||||
Fed funds lines, Fed discount window and | ||||||||||||||||||||
Bank Term Funding Program | 2,206,000 | 1,982,000 | 426,000 | |||||||||||||||||
Additional liquidity sources | $ | 10,780,000 | $ | 10,604,000 | $ | 8,358,000 | ||||||||||||||
Uninsured deposit coverage ratio | 2.0 | 1.6 | 1.4 |
Page 11 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Calculation of Adjusted Return on Average Assets | ||||||||||||||||||||
Net income available to common stockholders | $ | 45,589 | $ | 83,260 | $ | 80,603 | $ | 27,454 | $ | 65,095 | ||||||||||
Certain items (non-GAAP) | ||||||||||||||||||||
(Gain) loss from early retirement of TruPS | - | - | 365 | - | - | |||||||||||||||
Gain on sale of intellectual property | - | - | (750 | ) | - | - | ||||||||||||||
Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
Donation to Simmons First Foundation | - | - | - | 1,738 | - | |||||||||||||||
Merger related costs | 1,396 | 35 | 1,422 | 19,133 | 1,886 | |||||||||||||||
Branch right sizing (net) | 979 | 1,104 | 1,235 | 380 | 909 | |||||||||||||||
Day 2 CECL provision | - | - | - | 33,779 | - | |||||||||||||||
Tax effect of certain items (2) | (621 | ) | 768 | (594 | ) | (14,382 | ) | (731 | ) | |||||||||||
Adjusted earnings (non-GAAP) | $ | 47,343 | $ | 81,093 | $ | 82,281 | $ | 68,102 | $ | 67,159 | ||||||||||
Average total assets | $ | 27,488,732 | $ | 27,180,575 | $ | 26,868,731 | $ | 26,769,032 | $ | 24,826,199 | ||||||||||
Return on average assets | 0.67 | % | 1.22 | % | 1.19 | % | 0.41 | % | 1.06 | % | ||||||||||
Adjusted return on average assets (non-GAAP) | 0.70 | % | 1.18 | % | 1.21 | % | 1.02 | % | 1.10 | % | ||||||||||
Calculation of Return on Tangible Common Equity | ||||||||||||||||||||
Net income available to common stockholders | $ | 45,589 | $ | 83,260 | $ | 80,603 | $ | 27,454 | $ | 65,095 | ||||||||||
Amortization of intangibles, net of taxes | 3,026 | 3,035 | 3,121 | 3,025 | 2,575 | |||||||||||||||
Total income available to common stockholders | $ | 48,615 | $ | 86,295 | $ | 83,724 | $ | 30,479 | $ | 67,670 | ||||||||||
Certain items (non-GAAP) | ||||||||||||||||||||
(Gain) loss from early retirement of TruPS | - | - | 365 | - | - | |||||||||||||||
Gain on sale of intellectual property | - | - | (750 | ) | - | - | ||||||||||||||
Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
Donation to Simmons First Foundation | - | - | - | 1,738 | - | |||||||||||||||
Merger related costs | 1,396 | 35 | 1,422 | 19,133 | 1,886 | |||||||||||||||
Branch right sizing (net) | 979 | 1,104 | 1,235 | 380 | 909 | |||||||||||||||
Day 2 CECL provision | - | - | - | 33,779 | - | |||||||||||||||
Tax effect of certain items (2) | (621 | ) | 768 | (594 | ) | (14,382 | ) | (731 | ) | |||||||||||
Adjusted earnings (non-GAAP) | 47,343 | 81,093 | 82,281 | 68,102 | 67,159 | |||||||||||||||
Amortization of intangibles, net of taxes | 3,026 | 3,035 | 3,121 | 3,025 | 2,575 | |||||||||||||||
Total adjusted earnings available to common stockholders (non-GAAP) | $ | 50,369 | $ | 84,128 | $ | 85,402 | $ | 71,127 | $ | 69,734 | ||||||||||
Average common stockholders' equity | $ | 3,370,651 | $ | 3,214,912 | $ | 3,292,071 | $ | 3,361,703 | $ | 3,169,108 | ||||||||||
Average intangible assets: | ||||||||||||||||||||
Goodwill | (1,319,624 | ) | (1,309,124 | ) | (1,309,804 | ) | (1,299,821 | ) | (1,146,034 | ) | ||||||||||
Other intangibles | (127,394 | ) | (131,229 | ) | (135,718 | ) | (114,195 | ) | (104,905 | ) | ||||||||||
Total average intangibles | (1,447,018 | ) | (1,440,353 | ) | (1,445,522 | ) | (1,414,016 | ) | (1,250,939 | ) | ||||||||||
Average tangible common stockholders' equity (non-GAAP) | $ | 1,923,633 | $ | 1,774,559 | $ | 1,846,549 | $ | 1,947,687 | $ | 1,918,169 | ||||||||||
Return on average common equity | 5.49 | % | 10.27 | % | 9.71 | % | 3.28 | % | 8.33 | % | ||||||||||
Return on tangible common equity | 10.25 | % | 19.29 | % | 17.99 | % | 6.28 | % | 14.31 | % | ||||||||||
Adjusted return on average common equity (non-GAAP) | 5.70 | % | 10.01 | % | 9.92 | % | 8.13 | % | 8.59 | % | ||||||||||
Adjusted return on tangible common equity (non-GAAP) | 10.62 | % | 18.81 | % | 18.35 | % | 14.65 | % | 14.74 | % | ||||||||||
Calculation of Efficiency Ratio and Adjusted Efficiency Ratio (1) | ||||||||||||||||||||
Noninterest expense (efficiency ratio numerator) | $ | 143,228 | $ | 142,575 | $ | 138,943 | $ | 156,813 | $ | 128,417 | ||||||||||
Certain noninterest expense items (non-GAAP) | ||||||||||||||||||||
Merger related costs | (1,396 | ) | (35 | ) | (1,422 | ) | (19,133 | ) | (1,886 | ) | ||||||||||
Donation to Simmons First Foundation | - | - | - | (1,738 | ) | - | ||||||||||||||
Branch right sizing expense | (979 | ) | (1,104 | ) | (1,170 | ) | (292 | ) | (909 | ) | ||||||||||
Other real estate and foreclosure expense adjustment | (186 | ) | (350 | ) | (168 | ) | (142 | ) | (343 | ) | ||||||||||
Amortization of intangibles adjustment | (4,096 | ) | (4,108 | ) | (4,225 | ) | (4,096 | ) | (3,486 | ) | ||||||||||
Adjusted efficiency ratio numerator | $ | 136,571 | $ | 136,978 | $ | 131,958 | $ | 131,412 | $ | 121,793 | ||||||||||
Net interest income | $ | 177,835 | $ | 193,026 | $ | 193,585 | $ | 185,099 | $ | 145,606 | ||||||||||
Noninterest income | 45,835 | 44,647 | 43,023 | 40,178 | 42,218 | |||||||||||||||
Fully tax-equivalent adjustment (effective tax rate of 26.135%) | 6,311 | 6,770 | 6,203 | 6,096 | 5,602 | |||||||||||||||
Efficiency ratio denominator | 229,981 | 244,443 | 242,811 | 231,373 | 193,426 | |||||||||||||||
Certain noninterest income items (non-GAAP) | ||||||||||||||||||||
Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
(Gain) loss from early retirement of TruPS | - | - | 365 | - | - | |||||||||||||||
Gain on sale of intellectual property | - | - | (750 | ) | - | - | ||||||||||||||
Branch right sizing income | - | - | 65 | 88 | - | |||||||||||||||
(Gain) loss on sale of securities | - | 52 | 22 | 150 | 54 | |||||||||||||||
Adjusted efficiency ratio denominator | $ | 229,981 | $ | 240,421 | $ | 242,513 | $ | 231,611 | $ | 193,480 | ||||||||||
Efficiency ratio (1) | 62.28 | % | 58.33 | % | 57.22 | % | 67.77 | % | 66.39 | % | ||||||||||
Adjusted efficiency ratio (non-GAAP) (1) | 59.38 | % | 56.97 | % | 54.41 | % | 56.74 | % | 62.95 | % |
(1) Efficiency ratio is noninterest expense as a percent of net interest income (fully taxable equivalent) and noninterest revenues. Adjusted efficiency ratio is noninterest expense before foreclosed property expense, amortization of intangibles and certain adjusting items as a percent of net interest income (fully taxable equivalent) and noninterest revenues, excluding gains and losses from securities transactions and certain adjusting items, and is a non-GAAP measurement.
(2) Effective tax rate of 26.135%.
Page 12 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date (continued) | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Calculation of Pre-Provision Net Revenue (PPNR) | ||||||||||||||||||||
Net interest income | $ | 177,835 | $ | 193,026 | $ | 193,585 | $ | 185,099 | $ | 145,606 | ||||||||||
Noninterest income | 45,835 | 44,647 | 43,023 | 40,178 | 42,218 | |||||||||||||||
Revenue | 223,670 | 237,673 | 236,608 | 225,277 | 187,824 | |||||||||||||||
Less: Gain (loss) on sale of securities | - | (52 | ) | (22 | ) | (150 | ) | (54 | ) | |||||||||||
Less: Noninterest expense | 143,228 | 142,575 | 138,943 | 156,813 | 128,417 | |||||||||||||||
Pre-Provision Net Revenue (PPNR) | $ | 80,442 | $ | 95,150 | $ | 97,687 | $ | 68,614 | $ | 59,461 | ||||||||||
Calculation of Adjusted Pre-Provision Net Revenue | ||||||||||||||||||||
Pre-Provision Net Revenue (PPNR) | $ | 80,442 | $ | 95,150 | $ | 97,687 | $ | 68,614 | $ | 59,461 | ||||||||||
Plus: Loss from early retirement of TruPS | - | - | 365 | - | - | |||||||||||||||
Less: Gain on sale of intellectual property | - | - | (750 | ) | - | - | ||||||||||||||
Less: Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
Plus: Donation to Simmons First Foundation | - | - | - | 1,738 | - | |||||||||||||||
Plus: Merger related costs | 1,396 | 35 | 1,422 | 19,133 | 1,886 | |||||||||||||||
Plus: Branch right sizing costs | 979 | 1,104 | 1,235 | 380 | 909 | |||||||||||||||
Adjusted Pre-Provision Net Revenue | $ | 82,817 | $ | 92,215 | $ | 99,959 | $ | 89,865 | $ | 62,256 |
Page 13 |
Simmons First National Corporation | SFNC | |||||||||||||||||||
Reconciliation Of Non-GAAP Financial Measures - Year-to-Date | ||||||||||||||||||||
For the Quarters Ended | Mar 31 | Dec 31 | Sep 30 | Jun 30 | Mar 31 | |||||||||||||||
(Unaudited) | 2023 | 2022 | 2022 | 2022 | 2022 | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Calculation of Adjusted Return on Average Assets | ||||||||||||||||||||
Net income available to common stockholders | $ | 45,589 | $ | 256,412 | $ | 173,152 | $ | 92,549 | $ | 65,095 | ||||||||||
Certain items (non-GAAP) | ||||||||||||||||||||
(Gain) loss from early retirement of TruPS | - | 365 | 365 | - | - | |||||||||||||||
Gain on sale of intellectual property | - | (750 | ) | (750 | ) | - | - | |||||||||||||
Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
Donation to Simmons First Foundation | - | 1,738 | 1,738 | 1,738 | - | |||||||||||||||
Merger related costs | 1,396 | 22,476 | 22,441 | 21,019 | 1,886 | |||||||||||||||
Branch right sizing (net) | 979 | 3,628 | 2,524 | 1,289 | 909 | |||||||||||||||
Day 2 CECL provision | - | 33,779 | 33,779 | 33,779 | - | |||||||||||||||
Tax effect of certain items (2) | (621 | ) | (14,939 | ) | (15,707 | ) | (15,113 | ) | (731 | ) | ||||||||||
Adjusted earnings (non-GAAP) | $ | 47,343 | $ | 298,635 | $ | 217,542 | $ | 135,261 | $ | 67,159 | ||||||||||
Average total assets | $ | 27,488,732 | $ | 26,418,838 | $ | 26,162,136 | $ | 25,802,982 | $ | 24,826,199 | ||||||||||
Return on average assets | 0.67 | % | 0.97 | % | 0.88 | % | 0.72 | % | 1.06 | % | ||||||||||
Adjusted return on average assets (non-GAAP) | 0.70 | % | 1.13 | % | 1.11 | % | 1.06 | % | 1.10 | % | ||||||||||
Calculation of Return on Tangible Common Equity | ||||||||||||||||||||
Net income available to common stockholders | $ | 45,589 | $ | 256,412 | $ | 173,152 | $ | 92,549 | $ | 65,095 | ||||||||||
Amortization of intangibles, net of taxes | 3,026 | 11,756 | 8,721 | 5,600 | 2,575 | |||||||||||||||
Total income available to common stockholders | $ | 48,615 | $ | 268,168 | $ | 181,873 | $ | 98,149 | $ | 67,670 | ||||||||||
Certain items (non-GAAP) | ||||||||||||||||||||
(Gain) loss from early retirement of TruPS | - | 365 | 365 | - | - | |||||||||||||||
Gain on sale of intellectual property | - | (750 | ) | (750 | ) | - | - | |||||||||||||
Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
Donation to Simmons First Foundation | - | 1,738 | 1,738 | 1,738 | - | |||||||||||||||
Merger related costs | 1,396 | 22,476 | 22,441 | 21,019 | 1,886 | |||||||||||||||
Branch right sizing (net) | 979 | 3,628 | 2,524 | 1,289 | 909 | |||||||||||||||
Day 2 CECL provision | - | 33,779 | 33,779 | 33,779 | - | |||||||||||||||
Tax effect of certain items (2) | (621 | ) | (14,939 | ) | (15,707 | ) | (15,113 | ) | (731 | ) | ||||||||||
Adjusted earnings (non-GAAP) | 47,343 | 298,635 | 217,542 | 135,261 | 67,159 | |||||||||||||||
Amortization of intangibles, net of taxes | 3,026 | 11,756 | 8,721 | 5,600 | 2,575 | |||||||||||||||
Total adjusted earnings available to common stockholders (non-GAAP) | $ | 50,369 | $ | 310,391 | $ | 226,263 | $ | 140,861 | $ | 69,734 | ||||||||||
Average common stockholders' equity | $ | 3,370,651 | $ | 3,259,664 | $ | 3,274,743 | $ | 3,265,935 | $ | 3,169,108 | ||||||||||
Average intangible assets: | ||||||||||||||||||||
Goodwill | (1,319,624 | ) | (1,266,762 | ) | (1,252,486 | ) | (1,223,352 | ) | (1,146,034 | ) | ||||||||||
Other intangibles | (127,394 | ) | (121,622 | ) | (118,385 | ) | (109,575 | ) | (104,905 | ) | ||||||||||
Total average intangibles | (1,447,018 | ) | (1,388,384 | ) | (1,370,871 | ) | (1,332,927 | ) | (1,250,939 | ) | ||||||||||
Average tangible common stockholders' equity (non-GAAP) | $ | 1,923,633 | $ | 1,871,280 | $ | 1,903,872 | $ | 1,933,008 | $ | 1,918,169 | ||||||||||
Return on average common equity | 5.49 | % | 7.87 | % | 7.07 | % | 5.71 | % | 8.33 | % | ||||||||||
Return on tangible common equity | 10.25 | % | 14.33 | % | 12.77 | % | 10.24 | % | 14.31 | % | ||||||||||
Adjusted return on average common equity (non-GAAP) | 5.70 | % | 9.16 | % | 8.88 | % | 8.35 | % | 8.59 | % | ||||||||||
Adjusted return on tangible common equity (non-GAAP) | 10.62 | % | 16.59 | % | 15.89 | % | 14.70 | % | 14.74 | % | ||||||||||
Calculation of Efficiency Ratio and Adjusted Efficiency Ratio (1) | ||||||||||||||||||||
Noninterest expense (efficiency ratio numerator) | $ | 143,228 | $ | 566,748 | $ | 424,173 | $ | 285,230 | $ | 128,417 | ||||||||||
Certain noninterest expense items (non-GAAP) | ||||||||||||||||||||
Merger related costs | (1,396 | ) | (22,476 | ) | (22,441 | ) | (21,019 | ) | (1,886 | ) | ||||||||||
Donation to Simmons First Foundation | - | (1,738 | ) | (1,738 | ) | (1,738 | ) | - | ||||||||||||
Branch right sizing expense | (979 | ) | (3,475 | ) | (2,371 | ) | (1,201 | ) | (909 | ) | ||||||||||
Other real estate and foreclosure expense adjustment | (186 | ) | (1,003 | ) | (653 | ) | (485 | ) | (343 | ) | ||||||||||
Amortization of intangibles adjustment | (4,096 | ) | (15,915 | ) | (11,807 | ) | (7,582 | ) | (3,486 | ) | ||||||||||
Adjusted efficiency ratio numerator | $ | 136,571 | $ | 522,141 | $ | 385,163 | $ | 253,205 | $ | 121,793 | ||||||||||
Net interest income | $ | 177,835 | $ | 717,316 | $ | 524,290 | $ | 330,705 | $ | 145,606 | ||||||||||
Noninterest income | 45,835 | 170,066 | 125,419 | 82,396 | 42,218 | |||||||||||||||
Fully tax-equivalent adjustment (effective tax rate of 26.135%) | 6,311 | 24,671 | 17,901 | 11,698 | 5,602 | |||||||||||||||
Efficiency ratio denominator | 229,981 | 912,053 | 667,610 | 424,799 | 193,426 | |||||||||||||||
Certain noninterest income items (non-GAAP) | ||||||||||||||||||||
Gain on insurance settlement | - | (4,074 | ) | - | - | - | ||||||||||||||
(Gain) loss from early retirement of TruPS | - | 365 | 365 | - | - | |||||||||||||||
Gain on sale of intellectual property | - | (750 | ) | (750 | ) | - | - | |||||||||||||
Gain on sale of branches | - | - | - | - | - | |||||||||||||||
Branch right sizing income | - | 153 | 153 | 88 | - | |||||||||||||||
(Gain) loss on sale of securities | - | 278 | 226 | 204 | 54 | |||||||||||||||
Adjusted efficiency ratio denominator | $ | 229,981 | $ | 908,025 | $ | 667,604 | $ | 425,091 | $ | 193,480 | ||||||||||
Efficiency ratio (1) | 62.28 | % | 62.14 | % | 63.54 | % | 67.14 | % | 66.39 | % | ||||||||||
Adjusted efficiency ratio (non-GAAP) (1) | 59.38 | % | 57.50 | % | 57.69 | % | 59.56 | % | 62.95 | % |
(1) Efficiency ratio is noninterest expense as a percent of net interest income (fully taxable equivalent) and noninterest revenues. Adjusted efficiency ratio is noninterest expense before foreclosed property expense, amortization of intangibles and certain adjusting items as a percent of net interest income (fully taxable equivalent) and noninterest revenues, excluding gains and losses from securities transactions and certain adjusting items, and is a non-GAAP measurement.
(2) Effective tax rate of 26.135%.
Page 14
Exhibit 99.2
Nasdaq: SFNC 1 st Quarter 2023 Earnings Presentation Contents 3 Company Profile 4 Q1 Financial Highlights 11 Deposits, Securities, Liquidity, Interest Rate Sensitivity and Capital 19 Loans 23 Credit Quality 26 Key Takeaways 28 Appendix
2 Forward - Looking Statements and Non - GAAP Financial Measures Forward - Looking Statements . Certain statements by Simmons First National Corporation (the “Company”, which where appropriate includes the Company’s wholly - owned banking subsidiary, Simmons Bank) contained in this presentation may not be based on historical facts and should be considered "forward - looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 . These forward - looking statements may be identified by reference to a future period(s) or by the use of forward - looking terminology, such as "anticipate," “believe,” “continue,” "estimate," "expect," "foresee,“ “indicate,” “plan,” “potential,” “project,” “target,” "may," "might," "will," "would," "could,“ “should,” “likely” or "intend," future or conditional verb tenses, and variations or negatives of such terms or by similar expressions . These forward - looking statements include, without limitation, statements relating to the Company’s future growth ; business strategies ; product development ; revenue ; expenses (including interest expense and non - interest expenses) ; assets ; loan demand (including loan growth, loan capacity, and other lending activity) ; deposit levels ; asset quality ; profitability ; earnings ; critical accounting policies ; accretion ; net interest margin ; noninterest revenue ; the Company's common stock repurchase program ; adequacy of the allowance for credit losses ; income tax deductions ; credit quality ; level of credit losses from lending commitments ; net interest revenue ; interest rate sensitivity (including, among other things, the potential impact of rising rates) ; loan loss experience ; liquidity ; capital resources ; future economic conditions and market risk ; interest rates ; the expected benefits, milestones, timelines, and costs associated with the Company’s merger and acquisition strategy and activity ; the Company’s ability to recruit and retain key employees ; increases in, and cash flows associated with, the Company’s securities portfolio ; legal and regulatory limitations and compliance and competition ; anticipated loan principal reductions ; plans for investments in and cash flows from securities ; projections regarding securities investments and maturities thereof ; the “ 2023 Efficiency Targets” and “Long - Term Objectives” set forth on slide 10 ; the interest rate sensitivity estimates, as well as the estimated interest income effect of the fair value hedges, noted on slide 17 ; digital bank initiatives ; and dividends . Readers are cautioned not to place undue reliance on the forward - looking statements contained in this presentation in that actual results could differ materially from those indicated in or implied by such forward - looking statements due to a variety of factors . These factors include, but are not limited to, changes in the Company's operating or expansion strategy ; the availability of and costs associated with obtaining adequate and timely sources of liquidity ; the ability to maintain credit quality ; the effects of the pandemic on, among other things, the Company’s operations, liquidity, and credit quality ; changes in general market and economic conditions ; increased unemployment ; labor shortages ; possible adverse rulings, judgments, settlements and other outcomes of pending or future litigation ; the ability of the Company to collect amounts due under loan agreements ; changes in consumer preferences and loan demand ; the effectiveness of the Company's interest rate risk management strategies ; laws and regulations affecting financial institutions in general or relating to taxes ; the effect of pending or future legislation ; the ability of the Company to repurchase its common stock on favorable terms ; the ability of the Company to successfully manage and implement its acquisition strategy and integrate acquired institutions ; difficulties and delays in integrating an acquired business or fully realizing cost savings and other benefits of mergers and acquisitions ; changes in interest rates, deposit flows, real estate values, and capital markets ; increased inflation ; customer acceptance of the Company's products and services ; changes or disruptions in technology and IT systems (including cyber threats, attacks and events) ; changes in accounting principles relating to loan loss recognition (current expected credit losses, or CECL) ; the benefits associated with the Company’s early retirement program ; political crises, war, and other military conflicts (including the ongoing military conflict between Russia and Ukraine) or other major events, or the prospect of these events ; increased competition ; changes in governmental policies ; loss of key employees ; the soundness of other financial institutions and indirect exposure related to the closings of Silicon Valley Bank (“SVB”), Signature Bank and Silvergate Bank and their impact on the broader market through other customers, suppliers and partners (or that the conditions which resulted in the liquidity concerns with SVB, Signature Bank and Silvergate Bank may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Company has commercial or deposit relationships) ; and other risk factors . Other relevant risk factors may be detailed from time to time in the Company's press releases and filings with the U . S . Securities and Exchange Commission, including, without limitation, the Company’s Form 10 - K for the year ended December 31 , 2022 . In addition, there can be no guarantee that the board of directors (“Board”) of the Company will approve a quarterly dividend in future quarters, and the timing, payment, and amount of future dividends (if any) is subject to, among other things, the discretion of the Board and may differ significantly from past dividends . Any forward - looking statement speaks only as of the date of this presentation, and the Company undertakes no obligation to update these forward - looking statements to reflect events or circumstances that occur after the date of this presentation . Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results . Non - GAAP Financial Measures . This presentation contains financial information determined by methods other than in accordance with U . S . generally accepted accounting principles (“GAAP”) . The Company’s management uses these non - GAAP financial measures in their analysis of the Company’s performance and capital adequacy . These measures adjust GAAP performance measures to, among other things, include the tax benefit associated with revenue items that are tax - exempt, as well as exclude from net income (including on a per share diluted basis), pre - tax, pre - provision earnings, net charge - offs, income available to common shareholders, non - interest income, and non - interest expense certain income and expense items attributable to merger activity (primarily including merger - related expenses and Day 2 CECL provisions), gains and/or losses on sale of branches, net branch right - sizing initiatives, loss on redemption of trust preferred securities and gain on sale of intellectual property . In addition, the Company also presents certain figures based on tangible common stockholders’ equity, tangible assets and tangible book value, which exclude goodwill and other intangible assets, and presents certain other figures to include the effect that accumulated other comprehensive income could have on the Company’s capital levels . The Company further presents certain figures that are exclusive of the impact of Paycheck Protection Program (“PPP”) loans, deposits and/or loans acquired through acquisitions, mortgage warehouse loans, and/or energy loans, or gains and/or losses on the sale of securities . The Company’s management believes that these non - GAAP financial measures are useful to investors because they, among other things, present the results of the Company’s ongoing operations without the effect of mergers or other items not central to the Company’s ongoing business, present the Company’s capital inclusive of the potential impact of AOCI (primarily comprised of unrealized losses on securities), as well as normalize for tax effects, the effects of the PPP, and certain other effects . Management, therefore, believes presentations of these non - GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s ongoing businesses, and management uses these non - GAAP financial measures to assess the performance of the Company’s ongoing businesses as related to prior financial periods . These non - GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non - GAAP performance measures that may be presented by other companies . Where non - GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the appendix to this presentation .
3 Simmons First National Corporation A community - based bank serving our customers and the communities where we work and live since 1903 Company Overview $27.6 BILLION TOTAL ASSETS $22.5 BILLION TOTAL DEPOSITS 114 CONSECUTIVE YEARS PAYING DIVIDENDS 3 $7.7 BILLION ASSETS UNDER MANAGEMENT/ ADMINISTRATION $16.6 BILLION TOTAL LOANS 120 YEARS OF SERVICE 231 FINANCIAL CENTERS ACROSS SIX STATES 14.5% TOTAL RBC RATIO 7.3% TCE RATIO 1 4.8% DIVIDEND YIELD 2 74% LOAN TO DEPOSIT RATIO 0.26% NPA TO TOTAL ASSETS 324% NPL COVERAGE RATIO Figures presented on this slide are as of March 31, 2023, unless otherwise noted (1) Non - GAAP measures that management believes aids in the discussion of results. See appendix for Non - GAAP reconciliation (2) Based on April 14, 2023, closing stock price of $16.58 and projected annualized dividend rate of $0.80 per share (3) The future payment of dividends is not guaranteed and is subject to various factors, including approval by the Company’ s b oard of directors
Q1 23 Financial Highlights
5 Balance Sheet Highlights $ in millions, except per share data Q1 23 Q4 22 Q1 22 $ Change % Change $ Change % Change Period End Balances Total loans $16,555.1 $16,142.1 $12,028.6 $413.0 3 % $4,526.5 38 % Investment securities 7,521.4 7,612.6 8,196.9 (91.1) (1) (675.5) (8) Total assets 27,583.4 27,461.1 24,482.3 122.4 - 3,101.2 13 Total deposits 22,451.8 22,548.1 19,392.4 (96.3) - 3,059.4 16 Borrowed funds 1,532.7 1,385.7 1,918.3 147.0 11 (385.6) (20) Total stockholders' equity 3,339.9 3,269.4 2,961.6 70.5 2 378.3 13 Average Balances Total loans $16,329.8 $15,930.0 $11,895.8 $399.8 3 % $4,434.0 37 % Investment securities 7,555.6 7,668.0 8,533.1 (112.4) (1) (977.5) (11) Total assets 27,488.7 27,180.6 24,826.2 308.2 1 2,662.5 11 Total deposits 22,520.4 22,233.3 19,509.5 287.1 1 3,011.0 15 Borrowed funds 1,302.5 1,468.1 1,940.0 (165.6) (11) (637.6) (33) Total stockholders' equity 3,370.7 3,214.9 3,169.1 155.7 5 201.5 6 Select Other Data Equity to assets 12.11% 11.91% 12.10% Tangible common equity to tangible assets 1 7.25 7.00 7.37 Book value per share $26.24 $25.73 $26.32 $0.51 2 % $(0.08) - % Tangible book value per share 1 14.88 14.33 15.22 0.55 4 (0.34) (2) Allowance for credit losses to total loans 1.25% 1.22% 1.49% Nonperforming loan coverage ratio 324 334 278 Q1 23 vs Q4 22 Q1 23 vs Q1 22 (1) Non - GAAP measures that management believes aids in the discussion of results. See appendix for Non - GAAP reconciliation
Q1 23 Highlights Income Summary $ in millions, except per share data Q1 23 Q4 22 Q1 22 Q4 22 Q1 22 Net interest income $177.8 $193.0 $145.6 (8) % 22 % Noninterest income, excluding securities gain (loss) (1) 45.8 44.7 42.3 3 8 Total revenue, excluding securities gain (loss) (1) 223.7 237.7 187.9 (6) 19 Noninterest expense 143.2 142.6 128.4 - 12 Pre-provision net revenue (1) 80.4 95.2 59.5 (15) 35 Gain (loss) on sale of securities - (0.1) (0.1) NM NM Provision for (recapture of) credit losses on loans 10.9 - (19.9) NM NM Provision for credit losses on investment securities 13.3 - - NM NM Provision for income taxes 10.6 11.8 14.2 (10) (25) Net income $ 58.9 $ 83.3 $ 65.1 (29) % (10)% Diluted EPS $ 0.36 $ 0.65 $ 0.58 (45) % (38)% Impact of certain items: Merger related costs $ 1.4 $ - $ 1.9 Branch right sizing costs 1.0 1.1 0.9 Gain on insurance settlement - (4.1) - Tax effect (2) (0.6) 0.8 (0.7) Total impact on earnings $ 1.8 ($2.2) $ 2.1 Adjusted pre-provision net revenue (1) $ 82.8 $ 92.2 $ 62.3 (10) % 33 % Adjusted net income (1) $ 60.6 $ 81.1 $ 67.2 (25) % (10)% Adjusted diluted EPS (1) $ 0.37 $ 0.64 $ 0.59 (42) % (37)% % Change vs 6 Income Summary Note: Numbers may not add due to rounding NM – not meaningful (1) Non - GAAP measures that management believes aids in the discussion of results. See appendix for Non - GAAP reconciliation (2) Effective tax rate of 26.135% Linked Quarter Comparison (Q 1 23 vs Q 4 22 ) □ Total revenue of $ 223 . 7 million reflects decline in net interest income due to increase in deposit cost, partially offset by fees and other income □ Expense growth contained with expense initiatives taking form late in the quarter □ Pre - provision net revenue of $ 80 . 4 million ; adjusted pre - provision net revenue of $ 82 . 8 million □ Provision expense consisting of : ▪ $ 10 . 9 million reflecting loan growth in the quarter and the impact of updated economic assumptions ▪ $13.3 million related to isolated securities in the corporate bond portfolio Diluted EPS and adjusted diluted EPS for Q1 23 includes $0.08 per share impact from market valuation adjustments on isolated securities in the corporate bond portfolio
Q1 23 Highlights 7 Net Interest Income and Margin (FTE) FTE – Fully taxable equivalent using an effective tax rate of 26.135% Totals may not foot due to rounding $151.2 $191.2 $199.8 $199.8 $184.1 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Net Interest Income $ in millions; FTE Δ in Interest Income (FTE) excluding accretion Δ in Interest Expense Δ in Accretion Net Interest Income Evolution $ in millions; FTE Net Interest Margin/Earning Assets Yield FTE (%) 2.76 3.24 3.34 3.31 3.09 3.06 3.57 3.96 4.49 4.78 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 NIM EA Yield 4.34 4.54 4.86 5.40 5.67 1.86 2.08 2.29 2.68 2.92 0.14 0.18 0.47 1.02 1.58 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Loan Yield (FTE) Securities (FTE) Cost of Deposits Loan, Securities & Deposits Yield/Rate FTE (%) Q4 22 Q1 23 Linked Quarter Comparison (Q 1 23 vs Q 4 22 ) □ Asset portion of balance sheet ▪ + 27 bps increase in loan yields ▪ + 24 bps increase in securities yield ▪ + 29 bps increase in earnings assets yields ▪ Average loans up 3 % ▪ Average securities down 1 % □ Liability portion of balance sheet ▪ + 56 bps increase in cost of deposits ▪ Overall deposits levels unchanged but reflect continued change in mix of deposits from noninterest bearing to interest bearing ▪ Average other borrowings down 11 % □ Approximately $ 330 million of SFNC subordinated debt converts from fixed rate to floating rate on 4 / 1 / 23 □ Remaining balance of purchase accounting accretion at 3 / 31 / 23 was $ 19 . 4 million
$14.6 $12.4 $13.4 $13.8 $14.4 $14.6 $12.5 $13.3 $12.6 $14.4 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Noninterest income per employee Adjusted noninterest income, excluding securities gain (loss) per employee(1) Noninterest Income Per Employee (FTE) ($ in thousands) $ in millions Q1 23 Q4 22 Q1 22 Q4 22 Q1 22 Service charges on deposit accounts $12.4 $11.9 $ 10.7 5 % 16 % Wealth management fees 7.4 8.2 8.0 (10) (8) Debit and credit card fees 8.0 7.8 7.4 1 7 Mortgage lending income 1.6 1.1 4.6 38 (65) Bank owned life insurance 3.0 3.0 2.7 - 10 Other service charges and fees 2.3 2.0 1.6 13 39 Other 7.3 6.6 7.3 10 0 41.9 40.6 42.3 3 (1) Gain (loss) on sale of securities - (0.1) (0.1) NM NM Legal reserve recapture/gain on insurance settlement 4.0 4.1 - NM NM Total noninterest income $45.8 $44.6 $42.2 3 % 9 % Adjusted noninterest income (1) $45.8 $40.6 $42.2 13 % 9 % % Change vs 22.5% 17.8% 18.2% 18.8% 20.5% 22.5% 17.9% 18.1% 17.4% 20.5% Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Noninterest income/total revenue Adjusted Noninterest Income, excluding securities gain (loss)/adjusted total revenue(1) Noninterest Income to Total Revenue $64.9 $69.7 $73.8 $73.5 $70.1 $64.9 $69.8 $73.7 $72.2 $70.1 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Total revenue per employee Adjusted total revenue per employee(1) Revenue Per Employee (FTE) ($ in thousands) 8 Noninterest Income Totals may not foot due to rounding NM – not meaningful FTE – Full - time equivalent (1) Non - GAAP measures that management believes aids in the discussion of results. See appendix for Non - GAAP reconciliation Q1 23 Highlights Linked Quarter Comparison (Q 1 23 vs Q 4 22 ) □ Recurring fee income (service charges on deposit accounts, wealth management fees and debit and credit card fees) up 6 % compared to Q 1 22 □ Service charges on deposits and debit and credit card fees reflects increase in consumer activity and usage □ Decline in wealth management fees reflects sale of royalty trust business in Q 4 22 □ Increase in other income driven by an increase of sales of matched interest rate swaps for customers □ Legal reserve recapture associated with legal matters previously disclosed in public filings
$ in millions Q1 23 Q4 22 Q1 22 Q4 22 Q1 22 Salaries and employee benefits $77.0 $73.0 $67.9 6 % 13 % Occupancy expense, net 11.6 11.6 10.0 - 16 Furniture and equipment 5.1 5.4 4.8 (6) 6 Deposit insurance 4.9 3.7 1.8 33 166 OREO and foreclosure expense 0.2 0.4 0.3 (47) (46) Other 43.1 48.5 41.6 (11) 3 Merger related costs 1.4 - 1.9 NM (26) Total noninterest expense $143.2 $142.6 $128.4 - % 12 % Adjusted noninterest expense (1) $140.9 $141.4 $125.6 - % 12 % % Change vs 2,893 3,233 3,206 3,236 3,189 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Employees (FTE) 66.4% 67.8% 57.2% 58.3% 62.3% 63.0% 56.7% 54.4% 57.0% 59.4% Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Efficiency ratio Adjusted efficiency ratio (1) Efficiency Ratio 2.07% 2.34% 2.07% 2.10% 2.11% 2.02% 2.03% 2.03% 2.08% 2.08% Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Noninterest expense Adjusted noninterest expense (1) Noninterest Expense as a Percentage of Total Average Assets 9 Noninterest Expense Note: Numbers may not add due to rounding NM – not meaningful FTE – full - time equivalent (1) Non - GAAP measures that management believes aids in the discussion of results. See appendix for Non - GAAP reconciliation Q1 23 Highlights Linked Quarter Comparison (Q 1 23 vs Q 4 22 ) □ Overall expenses held flat on a linked quarter basis □ Increase in expenses from a year ago includes impact of Spirit of Texas Bancshares, Inc . acquisition that closed in April 2022 . □ Increase in salaries and employee benefits on a linked quarter basis reflects seasonal payroll taxes incurred in Q 1 , as well as 401 (k) company profit sharing contribution and equity award compensation □ Decline in other expense due to strong expense management of controllable expenses and $ 1 . 2 million of accelerated amortization of certain tax credits recorded in Q 4 .
Note: The “2023 Efficiency Targets” and “Long - Term Objectives” set forth on this slide reflect Company expectations and projecti ons Better Bank Initiative: Framework to deliver efficiencies and scalability Operational Excellence Great Place to Work Foundation Sustainable Growth P eople P rocess S ystems Long - Term Objectives (3 - 5 years) ROA ≥ 1.50% Efficiency ratio = low 50% 10 2023 Efficiency Targets □ ~$15 million in annual noninterest expense cost savings ▪ ~50% achieved in Q2 - Q3 and 100% achieved by Q4 ▪ Includes early retirement program, operational efficiencies and other identified opportunities Ongoing Initiatives □ Balance sheet, liquidity & revenue optimization □ Enhance deposit and lending operations processes □ Expand data analytics capabilities and decision process □ Optimize product delivery channels □ Continued optimization of branch and digital delivery channels
Deposits, Securities, Liquidity, Interest Rate Sensitivity and Capital
$5,268 at 3.31.23 12 Deposits: Granular and well - diversified relationship - driven deposit base Peer Group includes: ABCB, AUB, OZK, BOKF, CADE, CBSH, CFR, FBK, HWC, HWC, HOMB, IBTX, ONB, PNFP, PB, RNST, SSB, SNV, TRMK, U MBF and UCBI (1) Data as of 12/31/22 Call Report per S&P Global Market Intelligence. Core deposits defined as total deposits excluding t ime deposits over $250,000 and brokered deposits of $250,000 or less (2) Represents consumer and commercial accounts, excluding public funds and brokered deposits. Accounts from acquisitions u til ize date account opened or, if not available, the closing date of the acquisition (3) Uninsured deposits represent deposit accounts that exceed FDIC insurance limit, excluding public fund accounts and othe r d eposit accounts that are collateralized, accounts that utilize CDARS or repo sweep programs and deposit balances of SFNC subs idi aries $81,459 $130,081 $360,778 Peer 1 Peer 2 SFNC Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 Peer 9 Peer 10 Peer 11 Median Peer 12 Peer 13 Peer 14 Peer 15 Peer 16 Peer 17 Peer 18 Peer 19 Peer 20 Peer 21 $ in thousands Core Deposits per Branch 1 □ More than 628,000 deposit accounts □ Excluding brokered deposits and public funds, average deposit size $25,000 ▪ $16,500 for consumer accounts ▪ $90,000 for business/commercial accounts □ Deposit accounts represent long - term relationships 2 ▪ 12+ years average duration of client relationship for a noninterest bearing checking account ▪ 17+ years average duration of client relationship for an interest bearing checking account ▪ 14+ years average duration of client relationship for a savings/money market account □ Top 20 largest deposit relationships (including public funds) represent only 8% of total deposits Deposit Portfolio Highlights (as of March 31, 2023) Simmons Bank Uninsured Deposits 3 $ in millions $5,897 Intercompany Eliminations $629 □ ~23% of uninsured deposits to total deposits □ 2.0x coverage ratio of uninsured deposits to additional liquidity sources (listed on slide 16)
0.65% 1.41% 2.10% 0.47% 1.02% 1.58% 2.20% 3.65% 4.52% 0.00% 0.75% 1.50% 2.25% 3.00% 3.75% 4.50% 5.25% Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Interest Bearing Deposits Cost of Deposits Avg Fed Funds Rate Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Noninterest Bearing Interest Bearing Transactions Time Deposits 13 Deposits: Change in mix reflects current interest rate environment Source: Average Fed Funds rate based on data from www.macrotrends.net (1) Deposit beta calculated as change in cost of deposits from Q4 21 to Q1 23 divided by the change in quarterly average Fe der al Funds Effective rate for Q4 21 vs Q1 23. (2) Excludes public funds and brokered deposits $19.4 Evolution of Funding Rates $22.0 $22.1 +0% $206 $536 $(311) $(527) $(96) Linked Quarter Deposit Change $ in millions Total Deposits Noninterest Bearing Transaction Accounts Interest Bearing Transaction Accounts Time Deposits Deposit Mix $ in billions $22.5 Brokered Deposits (money market & CDs) 33% deposit beta during this cycle (1) $22.5 From March 8 through March 31, 2023: □ Opened more than 7,200 noninterest bearing, interest bearing transaction and time deposit accounts □ Opened accounts represent ~$350 million in deposit balances Key Statistics 2
Digital: Significantly expanded digital solutions focused on deposit gathering Zelle and Zelle related marks are wholly owned by Early Warning Services, LLC and are used herein under license (1) Certain terms and conditions apply and can be found on our website at https://www.simmonsbank.com/personal/checking/coin - checking 14 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Zelle ® Volume (transactions) +50% +30% +21% +168% Q1 22 Q1 23 Mobile Deposit Accounts +8% Q1 22 Q1 23 Mobile Deposit Dollars +15% Q1 22 Q1 23 Branch Transactions Digital Transactions Customer Transactions by Channel 67% 70% 71% +19% Digital Expanding Suite of Digital Solutions +13% Q2 2021 Coin Checking Simmons Bank’s first fully digital account origination solution Zelle Allows customers to quickly and easily send, receive and request money with friends and family right from Simmons Bank Mobile and Online Banking Q3 2021 Q3 2022 Coin Savings By bundling a Coin Checking account with a Coin Savings account, customer can earn a higher interest rate 1 Q4 2022 Credit Score Manager Complimentary feature that allows customers to view their credit score, gain insight into the different factors that contribute to their score and run simulations Q1 2023 CDs & Money Market Further expanded digital deposit account offerings to include CDs and Money Market accounts . Current customers can open an account simply by clicking “Open an account”
Securities Portfolio: Highly rated portfolio and balance sheet optimization funding source FTE – fully taxable equivalent using an effective tax rate of 26.135% (1) Effective yield of securities portfolio at 3/31/23, excluding AOCI impact of HTM transfers made during Q2 22 15 8% 37% 48% 7% Securities Portfolio by Type Treasury/Agency States and Political Subdivisions MBS/CMO Corporate & Other AFS HTM At March 31, 2023 $2,940 $2,124 Aaa /AAA 527 1,158 Aa/AA 107 321 A 168 156 Baa/BBB 14 6 Not Rated $3,756 $ 3 , 765 Total $3,756 $ 3 , 149 Fair value Securities Portfolio Bond Ratings $ in millions 42% 58% Senior Debt Subordinated Debt Corporate Bond Portfolio Effective Duration Yield (FTE) (1) At March 31, 2023 Fixed Rate 11.64 3.15% Municipal 4.80 2.01 MBS/CMO 8.55 2.34 Treasury/Agency 4.43 4.48 Corporate 4.32 3.26 Other 0.04 4.96 Variable Rate 6.64 3.01% Total Securities Portfolio Summary Including the impact of $1B matched swap on certain fixed rate securities, the effective duration of the securities portfolio is reduced to 5.91 Securities Portfolio Highlights □ Continued focus on balance sheet optimization leads to further decline in securities portfolio . □ Average securities to total earning assets of 31 % at 3 / 31 / 23 compared to 39 % at 12 / 31 / 21 □ Cash flows from principal maturities of securities provides flexibility to fund future loan growth or reduce wholesale funding . Approximately $ 145 - $ 175 million per quarter of projected principal maturities □ 95 . 4 % of total portfolio A - rated or higher at 3 / 31 / 23 □ 55 % of corporate bond portfolio invested in Fortune 500 companies 45% 10% 20% 25% Fortune 500 - Banks Fortune 500 - Other Banks >$20B in assets Banks <$20B in assets
Loan to Deposit Ratio 90% 76% 67% 62% 60% 62% 62% 69% 70% 72% 74% Q4 19 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Peer Median 1 89% 80% 75% 72% 71% 69% 69% 74% 79% 83% NA FHLB borrowing availability Unpledged securities Fed Funds lines and Fed Discount Window and Bank Term Funding Program Additional Liquidity Sources $ in millions Total at 3.31.23 $10,780 16 Liquidity: Significant sources of liquidity and low reliance on borrowed funds Cash and Cash Equivalents + Variable Rate Securities $ in millions Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Cash & Cash Equivalents Variable Rate Securities $4,103 $3,606 $3,286 $3,150 $3,132 $2,321 $1,910 $1,824 FTE – fully taxable equivalent using an effective tax rate of 26.135% NA – not available (1) Source: S&P Global Market Intelligence. Represents peer median loan to deposit ratio. Peer group includes ABCB, AUB, OZK, BO KF, CADE, CBSH, FBK, HWC, HTLF, HOMB, IBTX, ONB, PNFP, PB, RNST, SSB, SNV, TRMK, UMBF, UCBI Borrowed Funds as a Percent of Total Liabilities 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 3/31/23 9% 8% 7% 6% 6% 5% 6% 13% 13% 10% 10% 9% 6% 6% $1,572 $ 5,574 3,000 2,206 □ ~ $ 145 - $ 175 million per quarter of projected securities principal maturities □ Approximately $ 1 . 2 billion principal of fixed rate loans maturing over the next 12 months at a weighted average rate of 5 . 17 %
17 Interest Rate Sensitivity Balance Sheet Interest Rate Sensitivity Over the next 12 months (estimated) 0.38% 0.22% - 0.01% D50 bps D25 bps U25 bps Estimated net interest income sensitivity given immediate, parallel shift in interest rates across the yield curve with a static balance sheet Immediate change in interest rates Loan Portfolio At March 31, 2023 41% 59% Variable Rate Loans Fixed Rate Loans Fixed vs Variable Rate 29% 71% No Floor Not At Floor Floor Status – Variable Rate Loans 48% 24% 5% 23% Daily Within 3Mo 4 to 12 Mo Over 12 Mo Variable Rate Loans – Rate Reset Date 0.87% 0.96% 0.06% Gradual change in interest rates* Estimated net interest income sensitivity given gradual, parallel shift in interest rates across the yield curve with a static balance sheet Fair Value Hedges At March 31, 2023 * Assumptions used in balance sheet interest rate sensitivity estimates under a gradual increase/decrease in interest rates i ncl ude the following: Down 50 bps scenario – 50 bp decrease in December Down 25 bps scenario – 25 bp decrease in December Up 25 bps scenario – 25 bp increase May Entered into a 2 - year forward starting swap in September 2021 to convert designated AFS securities from fixed interest rates to variable interest rates based on federal funds effective rate. Total duration of the swap is 7 years, but can be unwound i n whole, or in part, prior to maturity at the Company’s discretion. Receive Rate Weighted Avg Pay Rate Fair Value Notional Hedged Asset Instrument Federal Funds Effective (currently 4.83%) 1.21% $92 Million $1.0 Billion Fixed Rate Callable AFS Securities 2 - yr Forward Starting Swap Spread based on current rates Equates to estimated ~$36M of interest income (annual basis) 3.62% D50 bps D25 bps U25 bps
18 Capital: Focused on maintaining a strong capital position and growth of tangible book value (1) Q1 23 data as of March 31, 2023, Q4 22 data as of December 31, 2022, and Q1 22 data as of March 31, 2022 (2) Non - GAAP measure that management believes aids in the discussion of results. See Appendix for Non - GAAP reconciliation 9.0% 9.3% 9.2% Q1 22 Q4 22 Q1 23 W ELL C APITALIZED 5.0% Tier 1 Leverage Ratio (1) 13.5% 11.9% 11.9% Q1 22 Q4 22 Q1 23 CET 1 Capital Ratio (1) W ELL C APITALIZED 6.5% 13.5% 11.9% 11.9% Q1 22 Q4 22 Q1 23 Tier 1 Risk - Based Capital Ratio (1) 16.4% 14.2% 14.5% Q1 22 Q4 22 Q1 23 Total Risk - Based Capital Ratio (1) W ELL C APITALIZED 10.0% W ELL C APITALIZED 8.0% $26.32 $25.73 $26.24 Q1 22 Q4 22 Q1 23 Book Value Per Common Share (1) +2% $15.22 $14.33 $14.88 Q1 22 Q4 22 Q1 23 +4% Tangible Book Value Per Common Share (1) (2) Capital Ratios (at 3/31/23) and Market Value of Equity CET 1 Capital Ratio 11.9% CET 1 Capital Ratio, Including AOCI 2 9.6% Equity to Assets 12.1% Tangible Common Equity Ratio 2 7.3% □ Market value of equity has increased since year - end 2021
Loan Portfolio
20 Loan Portfolio: Well - diversified, granular portfolio with no significant concentrations (1) Total loans excluding credit card portfolio and mortgage warehouse Data shown above as of March 31, 2023. By State Loan Portfolio – Geographic diversification 32% 18% 16% 11% 5% 2% 16% Texas Arkansas Tennessee Missouri Oklahoma Kansas Other % of Total Loans 1 Top 10 MSA’s 10.2% Dallas - Plano - Irving 8.1% Houston - Sugarland - Baytown 6.2% Memphis 5.9% Nashville - Davidson - Murfreesboro 5.5% Fort Worth - Arlington 5.5% Little Rock - North Little Rock - Conway 3.8% St. Louis 3.3% Fayetteville - Springdale - Rogers 2.2% Oklahoma City 2.0% Jonesboro, AR Office Portfolio (non - owner occupied) 48% 13% 11% 11% 3% 14% Texas Arkansas Tennessee Missouri Oklahoma Other By State At 3/31/23 Key Statistics 0.00% NPL Ratio 0.00% Past Due 30+ Days $2.2M Average Loan Size $0.5M Median Loan Size 63% Number of Loans <$1M 49.3% Average LTV 54.3% Weighted Average LTV Retail (non - owner occupied) 45% 11% 11% 10% 6% 17% Texas Arkansas Tennessee Missouri Oklahoma Other By State At 3/31/23 Key Statistics 0.00% NPL Ratio 0.00% Past Due 30+ Days $2.0M Average Loan Size $0.9M Median Loan Size 51% Number of Loans <$1M 49.9% Average LTV 58.2% Weighted Average LTV Construction - Land Development 42% 9% 16% 5% 3% 25% Texas Arkansas Tennessee Missouri Oklahoma Other By State At 3/31/23 Key Statistics 0.17% NPL Ratio 0.05% Past Due 30+ Days $1.0M Average Loan Size $0.2M Median Loan Size 84% Number of Loans <$1M 58.3% Average LTV 60.1% Weighted Average LTV $1.0B $1.0B $2.8B $16.2B 1
$3,428 $4,473 $5,138 $5,000 $4,725 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Unfunded Commitments $ in millions Mortgage Warehouse / PPP Agricultural 21 Loan Portfolio: Solid growth that was geographically widespread PPP – Paycheck Protection Program Total loans at 3/31/23 Total loans at 12/31/22 $56 $15 $(4) $44 $39 $210 $53 $413 Linked Quarter Loan Growth $ in millions Total Loans RE - Commercial RE - Construction Commercial RE – Single Family Loan Portfolio Waterfall $ in millions Consumer & Other Funded loan /advances Paydowns/ payoffs +3% 80% variable rate • 72% tied to Prime • 28% tied to SOFR Loan Portfolio Highlights □ Well diversified growth by type and geographic market □ Office portfolio (non - owner occupied) represents less than 6 % of total loan portfolio ; granular portfolio with average loan size of $ 2 . 2 million and average LTV less than 50 % □ Highly focused on maintaining conservative underwriting standards and prudent structure guidelines □ Expect loan growth to moderate throughout the year given current economic forecasts and as unfunded commitments draw down
+47 bps $503 $766 $750 $824 $455 $392 $292 $484 $929 $838 $1,077 $542 $460 $252 $493 $619 $776 $1,114 $552 $270 $504 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Opportunity Proposal Ready to Close $2,314 $2,364 $3,015 $1,480 $1,549 $1,122 22 Loan Pipelines: Reflect conservative credit underwriting standards and economic conditions Rate Ready to Close 3.47% 3.28% 3.43% 4.45% 5.84% 6.85% 7.32% Commercial Loan Pipeline by Category $ in millions $242 $291 $219 $223 $183 $127 $106 $97 $108 $99 $58 $36 $21 $36 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Mortgage Closed Loan Volume Mortgage Pipeline Volume Mortgage Loan Volume $ in millions $1,048 Q1 23 Highlights □ Focused on maintaining prudent underwriting standards and pricing discipline given projections surrounding near - term future economic growth □ Increase in ready to close pipeline reflects pull through of previously identified proposal and opportunity pipelines □ Proposal and opportunity pipelines reflects current economic environment and disciplined credit appetite □ Rate ready to close + 47 bps on a linked quarter basis □ Mortgage loan originations in Q 1 23 ▪ 82 % purchase ▪ 18 % refinance
Credit Quality
24 Credit Quality: Key credit quality metrics remain at historically low - levels and reflect… Source: S&P Global Market Intelligence 2017 – 2022 (1) As of December 31, for each respective year shown above; quarterly data as of the end of the quarter for each respectiv e p eriod (2) Net charge - offs to average loans for the full - year for each respective year shown above; quarterly annualized data for eac h respective quarter Change 12/31/22 3/31/23 Annual Trend 1 bp 0.37% 0.38% NPL / Loans $4.8 $58.9 $63.7 Nonperforming Loans (in millions) 3 bps 0.23% 0.26% NPA / Assets $8.9 $62.5 $71.4 Nonperforming Assets (in millions) (3) bps 0.18% 0.15% Past Due 30+ Days / Loans (6) bps 0.09% 0.03% Net Charge - offs / Average Loans (10) bps 334% 324% NPL Coverage Ratio 3 bps 1.22% 1.25% ACL / Loans $413 $16,142 $16,555 Total Loans (in millions) … prudent underwriting standards and strategic decision in 2019 to de - risk certain elements of acquired loan portfolios 0.81% 0.67% 0.65% 0.96% 0.57% 0.37% 0.42% 0.37% 0.37% 0.38% 2017 2018 2019 2020 2021 2022 Q2 22 Q3 22 Q4 22 Q1 23 Annual Nonperforming loans / loans (1) Strategic decision to de - risk certain elements of the loan portfolio through planned run - off of particular acquired non - relationship credits Quarterly Nonperforming assets / total assets (1) 0.83% 0.64% 0.55% 0.64% 0.31% 0.23% 0.26% 0.23% 0.23% 0.26% 2017 2018 2019 2020 2021 2022 Q2 22 Q3 22 Q4 22 Q1 23 Annual Quarterly Net charge - offs to average loans (2) 0.31% 0.21% 0.24% 0.45% 0.13% 0.09% 0.02% 0.00% 0.13% 0.03% 2017 2018 2019 2020 2021 2022 Q2 22 Q3 22 Q4 22 Q1 23 Annual Quarterly K ey Credit Metrics : ▪ Average FICO Scores 754 ▪ Balance Weighted Average FICO Score 744 ▪ Line Utilization 20% 1.61% 1.64% 1.86% 1.60% 1.40% 1.44% 1.55% 1.30% 1.52% 1.69% 2017 2018 2019 2020 2021 2022 Q2 22 Q3 22 Q4 22 Q1 23 Credit card portfolio net charge - off ratio (2) Annual Quarterly
25 ACL: Reflects Moody’s revised economic forecast ACL – Allowance for Credit Losses on Loans (1) ALLL for 2017 – 2019 and ACL 2020 – 2022 (2) As of December 31, for each respective year shown above; quarterly data as of the end of the quarter for each respectiv e p eriod ACL / Loans ACL $ in millions 1.71% $ 205.3 ACL as of 12/31/21 (19.9) Q1 22 Recapture of Provision (6.5) Q1 22 Net Charge - Offs 1.49% $ 178.9 ACL as of 3/31/22 - Q2 22 Provision 30.3 Day 2 CECL Provision (Spirit) (0.7) Q2 22 Net Charge - Offs 4.1 Day 1 PCD Allowance (Spirit) 1.41% $ 212.6 ACL as of 6/30/22 (15.9) Q3 22 Recapture of Provision (0.2) Q3 22 Net Charge - Offs 1.1 Day 1 PCD Allowance Adjustment (Spirit) 1.27% $ 197.6 ACL as of 9/30/22 - Q4 22 Provision (5.1) Q4 22 Net Charge - Offs 4.5 Day 1 PCD Allowance Adjustment (Spirit) 1.22% $ 197.0 ACL as of 12/31/22 10.9 Q1 23 Provision (1.3) Q1 23 Net Charge - Offs 1.25% $ 206.6 ACL as of 3/31/23 Allowance for Credit Losses on Loans and Loan Coverage Reserve for Unfunded Commitments As of 3/31/23 As of 12/31/22 As of 9/30/22 As of 6/30/22 As of 3/31/22 $ in millions $4,725 $5,000 $5,138 $4,473 $3,428 Unfunded Commitments $41.9 $41.9 $41.9 $25.9 $22.4 Reserve 0.9% 0.8% 0.8% 0.6% 0.7% Reserve / Unfunded Balance ACL METHODOLOGY AS OF 3/31/23: ▪ Moody’s March 2023 scenarios with management’s weighting: Baseline (60%) / S1 (10%) / S3 (30%) ▪ Total credit coverage / total commitments: 1.17% ACL/ALLL (1) / Loans (%) and ACL/ALLL ($) (2) $ in millions $57 $68 $220 $238 $205 $179 $213 $198 $197 $207 0.48% 0.46% 1.52% 1.85% 1.71% 1.49% 1.41% 1.27% 1.22% 1.25% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1.60% 1.80% 2.00% $0 $25 $50 $75 $100 $125 $150 $175 $200 $225 $250 2018 2019 1/1/20 CECL Adoption 2020 2021 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23
Key Takeaways
27 Key Takeaways 1 Balance sheet optimization reflected continued shift in earnings asset mix and utilization of cash flows from principal maturities of investment securities portfolio as a funding source 2 Capital generation combined with reduction in AOCI resulted in an increase in both tangible book value per share and TCE ratio 3 Strong liquidity position highlighted the strength of our deposit franchise and limited reliance on borrowed funds . While not utilized, continued to maintain ample supply of additional liquidity sources 4 Granular and well - diversified relationship driven deposit base enabled overall level of deposits to remain relatively stable while the continued change in mix of deposits reflected industry trends given the current operating environment
Appendix
29 Breakout: Loan portfolio by Category as of March 31, 2023 as of December 31, 2022 Unfunded Commitment Reserve Unfunded Commitment $ ACL % Nonperforming $ Classified $ % of Total Loans Balance $ % of Total Loans Balance $ $ in millions Total Loan Portfolio - - 3.5% 1 1 1% 189 1% 197 Consumer - Credit Card 1.0% 28 2.2% - - 1% 143 1% 153 Consumer - Other 1.3% 2,682 1.1% 5 13 17% 2,777 16% 2,567 Real Estate - Construction 0.5% 280 1.2% 12 97 45% 7,521 46% 7,468 Real Estate - Commercial 0.4% 334 1.8% 24 29 16% 2,590 16% 2,546 Real Estate - Single - family 0.2% 1,223 1.1% 22 30 16% 2,661 16% 2,622 Commercial - - - - - - 8 - 9 PPP - - 0.2% - - 1% 152 1% 95 Mortgage Warehouse 0.3% 177 0.5% - - 1% 221 1% 206 Agriculture 0.2% 1 0.8% - - 2% 293 2% 279 Other 0.9% 4,725 1.25% 64 170 100% 16,555 100% 16,142 Total Loan Portfolio Loan Concentration (Holding Company Level) : 92% 87% C&D 263% 259% CRE Select Loan Categories (excluding PPP) 1.2% 201 1.2% 1 4 9% 1,465 9% 1,479 Retail 0.4% 1 0.4% - - 2% 338 2% 341 Nursing / Extended Care 0.6% 164 0.7% 1 11 3% 528 3% 501 Healthcare 1.0% 1,007 0.7% - 8 7% 1,130 6% 1,004 Multifamily 5.3% 36 2.6% 7 55 5% 793 5% 822 Hotel 0.8% 37 1.2% 1 2 3% 519 3% 505 Restaurant 4.1% 103 2.3% - 4 6% 962 6% 973 NOO Office 0.3% 5 1.1% 3 3 - 34 - 53 Energy
30 Non - GAAP Reconciliations Q1 Q4 Q3 Q2 Q1 2023 2022 2022 2022 2022 $ in thousands, except per share data Calculation of Adjusted Earnings $ 45,589 $ 83,260 $ 80,603 $ 27,454 $ 65,095 Net Income Certain items 1,396 35 1,422 19,133 1,886 Merger related costs 979 1,104 1,235 380 909 Branch right sizing, net - - - 33,779 - Day 2 CECL provision - - - 1,738 - Donation to Simmons First Foundation - - 365 - - Loss from early retirement of TruPS - - (750) - - Gain on sale of intellectual property - (4,074) - - - Gain on insurance settlement (621) _ 768 _ (594) _ (14,382) _ (731) Tax effect⁽¹⁾ 1,754 (2,167) 1,678 40,648 2,064 Certain items, net of tax $ 47,343 $ 81,093 $ 82,281 $ 68,102 $ 67,159 Adjusted earnings (non - GAAP) Calculation of Earnings and Adjusted Earnings per Diluted Share $ 45,589 $ 83,260 $ 80,603 $ 27,454 $ 65,095 Net Income _ - _ - _ - _ - _ - Less: Preferred stock dividend $ 45,589 $ 83,260 $ 80,603 $ 27,454 $ 65,095 Earnings available to common shareholders $ 0.36 $ 0.65 $ 0.63 $ 0.21 $ 0.58 Diluted earnings per share $ 47,343 $ 81,093 $ 82,281 $ 68,102 $ 67,159 Adjusted earnings (non - GAAP) - - - - - Less: Preferred stock dividend $ 47,343 $ 81,093 $ 82,281 $ 68,102 $ 67,159 Adjusted earnings available to common shareholders (non - GAAP) $ 0.37 $ 0.64 $ 0.64 $ 0.53 $ 0.59 Adjusted diluted earnings per share (non - GAAP) (1) Effective tax rate of 26.135%
Q1 Q4 Q3 Q2 Q1 2023 2022 2022 2022 2022 $ in thousands Calculation of Pre - Provision Net Revenue (PPNR) $ 177,835 $ 193,026 $ 193,585 $ 185,099 $ 145,606 Net interest income 45,835 44,647 43,023 40,178 42,218 Noninterest income - (52) (22) (150) (54) Less: Gain (loss) on sale of securities 143,228 142,575 138,943 156,813 128,417 Less: Noninterest expense $ 80,442 $ 95,150 $ 97,687 $ 68,614 $ 59,461 Pre - Provision Net Revenue (PPNR) (non - GAAP) Calculation of Adjusted Pre - Provision Net Revenue $ 80,442 $ 95,150 $ 97,687 $ 68,614 $ 59,461 Pre - Provision Net Revenue (PPNR) (non - GAAP) 1,396 35 1,422 19,133 1,886 Plus: Merger related costs 979 1,104 1,235 380 909 Plus: Branch right sizing costs, net - - 365 - - Plus: Loss from early retirement of TruPS - - - 1,738 - Plus: Donation to Simmons First Foundation - - (750) - - Less: Gain on sale of intellectual property - (4,074) - - - Less: Gain on insurance settlement $ 82,817 $ 92,215 $ 99,959 $ 89,865 $ 62,256 Adjusted Pre - Provision Net Revenue (non - GAAP) 31 Non - GAAP Reconciliations Calculation of Book Value and Tangible Book Value per Share $ 3,339,901 $ 3,269,362 $ 3,157,151 $ 3,259,895 $ 2,961,607 Total common stockholders' equity Intangible assets: (1,320,799) (1,319,598) (1,309,000) (1,310,528) (1,147,007) Goodwill (124,854) (128,951) (133,059) (137,285) (102,748) Other intangible assets (1,445,653) (1,448,549) (1,442,059) (1,447,813) (1,249,755) Total intangible assets $ 1,894,248 $ 1,820,813 $ 1,715,092 $ 1,812,082 $ 1,711,852 Tangible common stockholders' equity (non - GAAP) 127,282,192 127,046,654 126,943,467 128,787,764 112,505,555 Shares of common stock outstanding $ 26.24 $ 25.73 $ 24.87 $ 25.31 $ 26.32 Book value per common share $ 14.88 $ 14.33 $ 13.51 $ 14.07 $ 15.22 Tangible book value per common share (non - GAAP)
32 Non - GAAP Reconciliations Q1 Q4 Q3 Q2 Q1 2023 2022 2022 2022 2022 $ in thousands, except number of employees (FTE) Calculation of Total Revenue Excluding Securities Gain (Loss) and Adjusted Total Revenue $ 177,835 $ 193,026 $ 193,585 $ 185,099 $ 145,606 Net Interest Income (GAAP) 45,835 44,647 43,023 40,178 42,218 Noninterest Income (GAAP) 223,670 237,673 236,608 225,277 187,824 Total Revenue - (52) (22) (150) (54) Less: Gain (loss) on sales of securities $ 223,670 $ 237,725 $ 236,630 $ 225,427 $ 187,878 Total Revenue, excluding securities gain (loss) (non - GAAP) $ 223,670 $ 237,725 $ 236,630 $ 225,427 $ 187,878 Total Revenue, excluding securities gain (loss) (non - GAAP) - - (65) (88) - Less: Branch right sizing income - - 750 - - Less: Gain on sale of intellectual property - - (365) - - Less: Loss from early retirement of TruPS - 4,074 - - - Less: Gain on insurance settlement $ 223,670 $ 233,651 $ 236,310 $ 225,515 $ 187,878 Adjusted Total Revenue (non - GAAP) 3,189 3,236 3,206 3,233 2,893 Employees (FTE) $ 70.14 $ 73.45 $ 73.80 $ 69.68 $ 64.92 Total Revenue per Employee (FTE) $ 70.14 $ 72.20 $ 73.71 $ 69.75 $ 64.94 Adjusted Total Revenue per Employee (FTE) FTE – Full time equivalent Calculation of Adjusted Noninterest Income and Adjusted Noninterest Income Excluding Securities Gain (Loss) $ 45,835 $ 44,647 $ 43,023 $ 40,178 $ 42,218 Noninterest Income (GAAP) - - (65) (88) - Less: Branch right sizing income - - 750 - - Less: Gain on sale of intellectual property - - (365) - - Less: Loss from early retirement of TruPS - 4,074 - - ____ - Less: Gain on insurances settlement $ 45,835 $ 40,573 $ 42,703 $ 40,266 $ 42,218 Adjusted Noninterest Income (non - GAAP) $ 45,835 $ 40,573 $ 42,703 $ 40,266 $ 42,218 Adjusted Noninterest Income (non - GAAP) - (52) _ (22) _(150) _(54) Less: Gain (loss) on sale of securities $ 45,835 $ 40,625 $ 42,725 $ 40,416 $ 42,272 Adjusted Noninterest Income, excluding securities gains (losses) (non - GAAP)
33 Non - GAAP Reconciliations Calculation of Adjusted Noninterest Expense $ 143,228 $ 142,575 $ 138,943 $ 156,813 $ 128,417 Noninterest Expense (GAAP) 1,396 35 1,422 19,133 1,886 Less: Merger related costs 979 1,104 1,170 292 909 Less: Branch right sizing expense - - - 1,738 - Less: Donation to Simmons First Foundation $ 140,853 $ 141,436 $ 136,351 $ 135,650 $ 125,622 Adjusted Noninterest Expense (non - GAAP) Calculation of Noninterest Expense to Average Assets $ 27,488,732 $ 27,180,575 $ 26,868,731 $ 26,769,032 $ 24,826,199 Average total assets 2.11% 2.10% 2.07% 2.34% 2.07% Noninterest expense to average total assets 2.08% 2.08% 2.03% 2.03% 2.02% Adjusted noninterest expense to average assets (non - GAAP) FTE – Full time equivalent Q1 Q4 Q3 Q2 Q1 2023 2022 2022 2022 2022 $ in thousands Calculation of Noninterest Income to Total Revenue 20.49% 18.79% 18.18% 17.83% 22.48% Noninterest Income to Total Revenue 20.49% 17.39% 18.08% 17.92% 22.50% Adjusted Noninterest Income, excluding securities gain (loss) to Adjusted Total Revenue (non - GAAP) (reconciliation shown on page 33) $ 14.37 $ 13.80 $ 13.42 $ 12.43 $ 14.59 Noninterest Income per Employee $ 14.37 $ 12.55 $ 13.33 $ 12.50 $ 14.61 Adjusted Noninterest Income per Employee (FTE)
34 Non - GAAP Reconciliations Q1 Q4 Q3 Q2 Q1 2023 2022 2022 2022 2022 $ in thousands Calculation of Efficiency Ratio and Adjusted Efficiency Ratio $ 143,228 $ 142,575 $ 138,943 $ 156,813 $ 128,417 Noninterest Expense (efficiency ratio numerator) $ 223,670 $ 237,673 $ 236,608 $ 225,277 $ 187,824 Total Revenue ___ _ _6,311 ___ _ _6,770 ___ _ _6,203 ___ _ _6,096 ____ __ 5,602 Fully taxable equivalent adjustment $ 229,981 $ 244,443 $ 242,811 $ 231,373 $ 193,426 Efficiency ratio denominator 62.28% 58.33% 57.22% 67.77% 66.39% Efficiency ratio (based on GAAP figures) $ 140,853 $ 141,436 $ 136,351 $ 135,650 $ 125,622 Adjusted Noninterest Expense (non - GAAP) (reconciliation shown on page 34) 186 350 168 142 343 Less: Other real estate and foreclosure expense ___ __ 4,096 ___ __ 4,108 ___ __ 4,225 ___ _ _4,096 ____ __ _3,486 Less: Amortization of intangible assets $ 136,571 $ 136,978 $ 131,958 $ 131,412 $ 121,793 Adjusted efficiency ratio numerator (non - GAAP) $ 223,670 $ 233,651 $ 236,310 $ 225,515 $ 187,878 Adjusted Total Revenue (non - GAAP) (reconciliation shown on page 33) ___ _ _6,311 ___ _ _6,770 ___ _ _6,203 ___ _ _6,096 ____ __ 5,602 Fully taxable equivalent adjustment $ 229,981 $ 240,421 $ 242,513 $ 231,611 $ 193,480 Adjusted efficiency ratio denominator non - GAAP) 59.38% 56.97% 54.41% 56.74% 62.95% Adjusted Efficiency Ratio (non - GAAP) Fully taxable equivalent adjustment using an effective tax rate of 26.135%
35 Non - GAAP Reconciliations FTE - Fully taxable equivalent adjustment using an effective tax rate of 26.135% Q1 Q4 Q1 2023 2022 2022 $ in thousands Calculation of Tangible Common Equity (TCE) $ 3,339,901 $ 3,269,362 $ 2,961,607 Total stockholders’ equity _______ _ - _______ _ - _______ _ - Less: Preferred stock $ 3,339,901 $ 3,269,362 $ 2,961,607 Total common stockholders’ equity $ 27,583,446 $ 27,461,061 $ 24,482,268 Total assets (1,445,653) (1,448,549) (1,249,755) Less: Intangible assets $ 26,137,793 $ 26,012,512 $ 23,232,513 Total tangible assets 12.11% 11.91% 12.10% Common equity to total assets 7.25% 7.00% 7.37% Tangible common equity to tangible common assets (non - GAAP) Calculation of CET 1 Capital Ratio, Including the Impact of AOCI $ 3,339,901 Total stockholders’ equity 61,746 CECL transition provision (1,410,141) Disallowed allowed intangible assets, net of deferred tax ____ _ 470,681 Unrealized loss (gain) on available for sale securities (AOCI) $ 2,462,187 Total tier 1 capital (CET 1) $ 2,462,187 Total tier 1 capital (CET 1) 470,681 Less: Unrealized loss (gain) on available for sale securities (AOCI) $ 1,991,506 Total tier 1 capital, including AOCI (non - GAAP) $ 20,748,605 Risk weighted assets 11.87% CET 1 capital ratio 9.60% CET 1 capital ratio, including AOCI
36 Non - GAAP Reconciliations FTE - Fully taxable equivalent adjustment using an effective tax rate of 26.135% Q1 Q4 Q1 2023 2022 2022 $ in thousands Calculation of Uninsured Deposit Coverage Ratio $ 5,896,752 $ 7,267,220 $ 6,414,459 Uninsured deposits at Simmons Bank ______628,592 ______527,542 ____ _504,306 Less: Intercompany eliminations $ 5,268,160 $ 6,739,678 $ 5,910,153 Total uninsured deposits $ 5,574,000 $ 5,442,000 $ 3,597,000 FHLB borrowing availability 3,000,000 3,180,000 4,335,000 Unpledged securities 2,206,000 1,982,000 426,000 Fed funds lines, Fed discount window and Bank Term Funding Program $ 10,780,000 $ 10,604,000 $ 8,358,000 Additional liquidity sources 2.0x 1.6x 1.4x Uninsured deposit coverage ratio
Nasdaq: SFNC 1 st Quarter 2023 Earnings Presentation Contents 3 Company Profile 4 Q1 Financial Highlights 11 Deposits, Securities, Liquidity, Interest Rate Sensitivity and Capital 19 Loans 23 Credit Quality 26 Key Takeaways 28 Appendix