Investor Relations

Press Release

ServisFirst Bancshares, Inc. Announces Results for Fourth Quarter of 2017

Company Release - 1/22/2018 4:01 PM ET

Birmingham, Ala., Jan. 22, 2018 (GLOBE NEWSWIRE) -- ServisFirst Bancshares, Inc. (NASDAQ:SFBS), today announced earnings and operating results for the quarter and year ended December 31, 2017.

Fourth Quarter 2017 Highlights:

  • Diluted EPS increased 13.2% from $1.52 to $1.72 year over year, while core diluted EPS increased 17.1% from $1.52 to $1.78
  • Additional tax provision from the revaluation of net deferred tax assets resulting from Tax Cuts and Jobs Act reduced diluted EPS by $0.06 in the fourth quarter of 2017
  • Loans and deposits increased 19% and 12%, respectively, year over year
  • Loans and deposits increased 16% and 20%, respectively, for the fourth quarter on an annualized basis

Tom Broughton, President and CEO, said, “We are pleased to report a year of strong growth in net income and loan and deposit growth. Our business model continues to resonate with our clients because of its focus on service.” Bud Foshee, CFO, stated, “We believe we took advantage of tax law changes to the maximum advantage for our stockholders in the fourth quarter of 2017. We also continued our cost control efforts, evidenced by a consistently low efficiency ratio.”

  
FINANCIAL SUMMARY (UNAUDITED)
 
(in Thousands except share and per share amounts) 
                         
    Period Ending
December 31, 2017
 Period Ending
September 30, 2017
 % Change
From Period
Ending
September 30, 2017
to Period
Ending
December 31, 2017
  Period Ending
December 31, 2016
 % Change
From Period
Ending
December 31, 2016
to Period
Ending
December 31, 2017
 
QUARTERLY OPERATING RESULTS                      
Net Income $21,150  $25,259   (16)%  $21,738   (3)% 
Net Income Available to Common Stockholders $21,119  $25,259   (16)%  $21,714   (3)% 
Diluted Earnings Per Share $0.39  $0.47   (17)%  $0.40   (3)% 
Return on Average Assets  1.20%  1.55%       1.39%     
Return on Average Common Stockholders' Equity  13.97%  17.28%       16.71%     
Average Diluted Shares Outstanding  54,161,788   54,099,672        53,961,160      
                         
Core Net Income* $24,424  $25,259   (3)%  $21,738   12% 
Core Net Income Available to Common Stockholders* $24,393  $25,259   (3)%  $21,714   12% 
Core Diluted Earnings Per Share* $0.45  $0.47   (4)%  $0.40   13% 
Core Return on Average Assets*  1.39%  1.55%       1.39%     
Core Return on Average Common Stockholders' Equity*  16.13%  17.28%       16.71%     
                       
YEAR-TO-DATE OPERATING RESULTS                      
Net Income $93,092           $81,479   14% 
Net Income Available to Common Stockholders $93,030           $81,432   14% 
Diluted Earnings Per Share $1.72           $1.52   13% 
Return on Average Assets  1.43%           1.42%     
Return on Average Common Stockholders' Equity  16.37%           16.63%     
Average Diluted Shares Outstanding  54,123,957            53,608,372      
                         
Core Net Income* $96,366           $81,479   18 
Core Net Income Available to Common Stockholders* $96,304           $81,432   18 
Core Diluted Earnings Per Share* $1.78           $1.52   17 
Core Return on Average Assets*  1.48%           1.42%     
Core Return on Average Common Stockholders' Equity*  16.95%           16.63%     
                         
BALANCE SHEET                      
Total Assets $7,082,384  $6,712,103   6%  $6,370,448   11% 
Loans  5,851,261   5,628,765   4%   4,911,770   19% 
Non-interest-bearing Demand Deposits  1,440,326   1,405,965   2%   1,281,605   12% 
Total Deposits  6,091,674   5,796,901   5%   5,420,311   12% 
Stockholders' Equity  607,604   590,213   3%   522,889   16% 
                       

* Core measures exclude non-routine expenses during the comparative periods presented in this press release as more fully described in “GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures” below.

DETAILED FINANCIALS

ServisFirst Bancshares, Inc. reported net income $21.2 million and net income available to common stockholders of $21.1 million for the quarter ended December 31, 2017, compared to net income and net income available to common stockholders of $21.7 million for the same quarter in 2016. Basic and diluted earnings per common share were $0.40 and $0.39, respectively, for the fourth quarter of 2017, compared to $0.41 and $0.40, respectively, for the fourth quarter of 2016.

In December 2017, we revalued our net deferred tax assets and recorded additional income tax expense of $3.1 million as a result of the reduction in the corporate income tax rate under the recently enacted Tax Cuts and Jobs Act of 2017. We also incurred $347,000 of non-routine expenses associated with moving into our new headquarters building in Birmingham, Alabama. The additional tax provision and non-routine expenses totaled $3.3 million, net of taxes, and are considered non-core components of our earnings in this press release. Excluding such non-core components, core net income and core net income available to common stockholders was $24.4 for the quarter ended December 31, 2017.

Return on average assets was 1.20% and return on average equity was 13.97% for the fourth quarter of 2017, compared to 1.39% and 16.71%, respectively, for the fourth quarter of 2016. Core return on average assets was 1.39% and core return on average equity was 16.13% for the fourth quarter of 2017.

Net interest income was $61.4 million for the fourth quarter of 2017, compared to $58.4 million for the third quarter of 2017 and $49.1 million for the fourth quarter of 2016. The net interest margin in the fourth quarter of 2017 was 3.66%, a decrease of 11 basis points from the third quarter of 2017 and an increase of 36 basis points from the fourth quarter of 2016. The decrease in net interest income on a linked quarter basis is attributable to a $224.5 million increase in excess liquidity and a five basis point increase in average rates paid on deposits.

The Company’s held-to-maturity investment portfolio was transferred to available-for-sale during the fourth quarter of 2017 to provide the Company more flexibility managing its portfolio.

Average loans for the fourth quarter of 2017 were $5.72 billion, an increase of $276.8 million, or 5%, over average loans of $5.44 billion for the third quarter of 2017, and an increase of $1.01 billion, or 22%, over average loans of $4.70 billion for the fourth quarter of 2016.

Average total deposits for the fourth quarter of 2017 were $6.03 billion, an increase of $502.6 million, or 9%, over average total deposits of $5.53 billion for the third quarter of 2017, and an increase of $761.7 million, or 14%, over average total deposits of $5.27 billion for the fourth quarter of 2016.

Non-performing assets to total assets were 0.25% for the fourth quarter of 2017, a decrease of three basis points compared to 0.28% for the third quarter of 2017 and a decrease of nine basis points compared to 0.34% for the fourth quarter of 2016. Net credit charge-offs to average loans for the fourth quarter of 2017 were 0.56%, a 46 basis point increase compared to 0.10% for the third quarter of 2017 and a 47 basis point increase compared to 0.09% for the fourth quarter of 2016. Net credit charge-offs to average loans for the year ended December 31, 2017 were 0.29% compared to 0.11% in 2016. The increase in net credit charge-offs for the fourth quarter and full year of 2017 was primarily attributable to a $5.8 million charge-off on one commercial relationship. Accordingly, we recorded a $9.1 million provision for loan losses in the fourth quarter of 2017 compared to $4.8 million in the third quarter of 2017 and $4.1 million in the fourth quarter of 2016. The allowance for loan losses as a percentage of total loans was 1.02% at December 31, 2017 compared to 1.04% at September 30, 2017 and 1.06% at December 31, 2016. In management’s opinion, the allowance is adequate and was determined by consistent application of ServisFirst Bank’s methodology for calculating its allowance for loan losses.

Non-interest income for the fourth quarter of 2017 was $4.9 million, a decrease of $1.1 million, or 18%, from the fourth quarter of 2016. During the fourth quarter of 2016 we recognized a $1.3 million gain on the sale of fixed assets. Service charges on deposit accounts increased $124,000 while mortgage banking revenue decreased by approximately $150,000 in the fourth quarter of 2017 compared to the fourth quarter of 2016. Credit card income increased approximately $246,000, or 23%, during the fourth quarter of 2017 compared to the fourth quarter of 2016. Purchases on credit cards increased by 36% year over year.

Non-interest expense for the fourth quarter of 2017 decreased $782,000, or 4%, to $21.3 million from $22.0 million in the fourth quarter of 2016, and decreased $242,000, or 1%, on a linked quarter basis. Salary and benefit expense for the fourth quarter of 2017 increased $235,000, or 2%, to $11.4 million from $11.2 million in the fourth quarter of 2016, and decreased $1.0 million, or 8%, on a linked quarter basis. The linked-quarter decrease resulted from a $786,000 reversal of incentive bonuses accrued during the first three quarters of 2017. Equipment and occupancy expense decreased $311,000, or 16%, to $1.6 million for the fourth quarter of 2017 compared to $1.9 million for the fourth quarter of 2016. We accelerated depreciation on our remaining tenant improvements of our previous headquarters building in Birmingham starting at the beginning of 2016 up to June of 2017 in anticipation of our move to our new headquarters building. Professional service expenses decreased by $225,000, or 21%, to $833,000 for the fourth quarter of 2017 compared to $1.1 million for the fourth quarter of 2016, a result of lower legal expenses. Other operating expense for the fourth quarter of 2017 decreased $508,000, or 7%, to $6.2 million from $6.7 million in the fourth quarter of 2016. Included in the fourth quarter of 2016 other operating expense is a $1.2 million write-down of a tax credit investment.

Income tax expense increased $7.6 million to $14.9 million in the fourth quarter of 2017, compared to $7.3 million in the fourth quarter of 2016. We recognized $3.1 million of additional tax expense as a result of revaluing our net deferred tax assets as of December 31, 2017 in connection with the Tax Cuts and Jobs Act passed into law in December 2017. We also recognized a $2.5 million federal tax credit during the fourth quarter of 2016. We recognized excess tax benefits from the exercise and vesting of stock options and restricted stock of $351,000 in the fourth quarter of 2017, compared to $54,000 in the fourth quarter of 2016.

Final financial results and other disclosures will be reported in our Annual Report on Form 10-K for the year ended December 31, 2017, and may differ materially from the results and disclosures in this press release due to, among other things, the completion of final review procedures, the occurrence of subsequent events, or the discovery of additional information.

GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures

We recorded $3.1 million of additional tax expense as a result of revaluing our net deferred tax assets at December 31, 2017 due to lower corporate income tax rates provided by the Tax Cuts and Jobs Act passed into law in December 2017. We also recorded expenses of $347,000 related to terminating the lease agreement on our previous headquarters building in Birmingham, Alabama and expenses of moving into our new headquarters building. Core financial measures included in this press release are “core net income,” “core net income available to common stockholders,” “core diluted earnings per share,” “core return on average assets,” and “core return on average common stockholders’ equity.” Each of these five core financial measures excludes the impact of the non-routine expenses attributable to our net deferred tax asset revaluation, lease termination and moving expenses, and are all considered non-GAAP financial measures. In addition to these financial measures adjusting for non-routine expenses, this press release contains certain non-GAAP financial measures, including tangible common stockholders’ equity, total tangible assets, tangible book value per share and tangible common equity to total tangible assets, each of which excludes goodwill and core deposit intangibles associated with our acquisition of Metro Bancshares, Inc. in January 2015. We believe these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that these non-GAAP financial measures have a number of limitations. As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies, including those in our industry, use. The following reconciliation tables provide a more detailed analysis of the non-GAAP financial measures as of and for the comparative periods presented in this press release. Dollars are in thousands, except share and per share data.

        
    Three Months Ended
December 31, 2017
 Year Ended
December 31, 2017
 
Return on average assets - GAAP  1.20%  1.43% 
Net income - GAAP $ 21,150   $ 93,092   
 Adjustments:         
 Revaluation of net deferred tax assets   3,059     3,059   
 Lease termination and moving expenses   347     347   
  Tax (benefit) of adjustments   (132)    (132)  
Core net income - non-GAAP* $ 24,424   $ 96,366   
Average assets $ 6,988,731   $ 6,495,067   
Core return on average assets - non-GAAP*   1.39 %   1.48 % 
            
Return on average common stockholders' equity - GAAP  13.97%  16.37% 
Net income available to common stockholders - GAAP $ 21,119   $ 93,030   
 Adjustments:         
 Revaluation of net deferred tax assets   3,059     3,059   
 Lease termination and moving expenses   347     347   
  Tax (benefit) of adjustments   (132)    (132)  
Core net income available to common stockholders - non-GAAP* $ 24,393   $ 96,304   
Average common stockholders' equity $ 599,947   $ 568,228   
Core return on average common stockholders' equity - non-GAAP*   16.13 %   16.95 % 
            
Diluted earnings per share - GAAP $0.39  $1.72  
Weighted average shares outstanding, diluted - GAAP   54,161,788     54,123,957   
Core diluted earnings per share - non-GAAP* $0.45  $1.78  
          
          


              
    At December 31, 2017 At September 30, 2017 At June 30, 2017 At March 31, 2017 At December 31, 2016 
Book value per share - GAAP $11.47  $11.14  $10.72  $10.32  $9.93  
Total common stockholders' equity - GAAP  607,604   590,213   567,086   545,148   522,889  
 Adjustments:                     
 Adjusted for goodwill and core deposit intangible asset  14,719   14,787   14,855   14,924   14,996  
Tangible common stockholders' equity - non-GAAP $592,885  $575,426  $552,231  $530,224  $507,893  
Tangible book value per share - non-GAAP $11.19  $10.86  $10.44  $10.04  $9.65  
                        
Stockholders' equity to total assets - GAAP  8.58%  8.79%  8.96%  8.60%  8.21% 
Total assets - GAAP $7,082,384  $6,712,103  $6,329,599  $6,336,165  $6,370,448  
 Adjustments:                     
 Adjusted for goodwill and core deposit intangible asset  14,719   14,787   14,855   14,924   14,996  
Total tangible assets - non-GAAP $7,067,665  $6,697,316  $6,314,744  $6,321,241  $6,355,452  
Tangible common equity to total tangible assets - non-GAAP  8.39%  8.59%  8.75%  8.39%  7.99% 
                      

* Core measures exclude non-routine expenses during the comparative periods presented in this press release as more fully described in “GAAP Reconciliation and Management Explanation on Non-GAAP Financial Measures” above.

Conference Call

ServisFirst Bancshares, Inc. will host a live audio webcast to discuss earnings and results on Monday, January 22, 2018 beginning at 5:15 p.m. ET. You may access the webcast at https://services.choruscall.com/links/sfbs180122.html. The webcast will be available until February 2, 2018.

About ServisFirst Bancshares, Inc.

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

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

Statements in this press release that are not historical facts, including, but not limited to, statements concerning future operations, results or performance, are hereby identified as "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. The words "believe," "expect," "anticipate," "project," “plan,” “intend,” “will,” “would,” “might” and similar expressions often signify forward-looking statements. Such statements involve inherent risks and uncertainties. ServisFirst Bancshares, Inc. cautions that such forward-looking statements, wherever they occur in this press release or in other statements attributable to ServisFirst Bancshares, Inc., are necessarily estimates reflecting the judgment of ServisFirst Bancshares, Inc.’s senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Such forward-looking statements should, therefore, be considered in light of various factors that could affect the accuracy of such forward-looking statements, including: general economic conditions, especially in the credit markets and in the Southeast; the performance of the capital markets; changes in interest rates, yield curves and interest rate spread relationships; changes in accounting and tax principles, policies or guidelines; changes in legislation or regulatory requirements; changes in our loan portfolio and the deposit base; possible changes in laws and regulations and governmental monetary and fiscal policies, including, but not limited to, economic stimulus initiatives; the cost and other effects of legal and administrative cases and similar contingencies; possible changes in the creditworthiness of customers and the possible impairment of the collectability of loans and the value of collateral; the effect of natural disasters, such as hurricanes and tornados, in our geographic markets; and increased competition from both banks and non-bank financial institutions. The foregoing list of factors is not exhaustive. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Cautionary Note Regarding Forward-looking Statements” and “Risk Factors” in our most recent Annual Report on Form 10-K and our other SEC filings. If one or more of the factors affecting our forward-looking information and statements proves incorrect, then our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements contained herein. Accordingly, you should not place undue reliance on any forward-looking statements, which speak only as of the date made. ServisFirst Bancshares, Inc. assumes no obligation to update or revise any forward-looking statements that are made from time to time.

More information about ServisFirst Bancshares, Inc. may be obtained over the Internet at www.servisfirstbancshares.com or by calling (205) 949-0302.

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

                      
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)                     
(In thousands except share and per share data)                     
  4th Quarter 2017 3rd Quarter 2017 2nd Quarter 2017 1st Quarter 2017 4th Quarter 2016 
CONSOLIDATED STATEMENT OF INCOME                     
Interest income $72,060  $67,641  $63,538  $59,517  $56,200  
Interest expense  10,652   9,245   7,971   7,465   7,091  
Net interest income  61,408   58,396   55,567   52,052   49,109  
Provision for loan losses  9,055   4,803   4,381   4,986   4,075  
Net interest income after provision for loan losses  52,353   53,593   51,186   47,066   45,034  
Non-interest income  4,905   4,790   4,805   4,546   6,039  
Non-interest expense  21,255   21,497   21,875   21,267   22,037  
Income before income tax  36,003   36,886   34,116   30,345   29,036  
Provision for income tax  14,853   11,627   9,952   7,826   7,298  
Net income  21,150   25,259   24,164   22,519   21,738  
Preferred stock dividends  31   -   31   -   24  
Net income available to common stockholders $21,119  $25,259  $24,133  $22,519  $21,714  
Earnings per share - basic $0.40  $0.48  $0.46  $0.43  $0.41  
Earnings per share - diluted $0.39  $0.47  $0.45  $0.42  $0.40  
Average diluted shares outstanding  54,161,788   54,099,672   54,100,604   54,133,722   53,961,160  
                      
CONSOLIDATED BALANCE SHEET DATA                     
Total assets $7,082,384  $6,712,103  $6,329,599  $6,336,165  $6,370,448  
Loans  5,851,261   5,628,765   5,343,688   5,151,984   4,911,770  
Debt securities  538,330   522,724   518,065   526,023   484,939  
Non-interest-bearing demand deposits  1,440,326   1,405,965   1,373,353   1,292,440   1,281,605  
Total deposits  6,091,674   5,796,901   5,394,810   5,361,532   5,420,311  
Borrowings  64,832   54,975   55,075   55,169   55,262  
Stockholders' equity $607,604  $590,213  $567,086  $545,148  $522,889  
                      
Shares outstanding  52,992,586   52,970,310   52,909,362   52,812,396   52,636,896  
Book value per share $11.47  $11.14  $10.72  $10.32  $9.93  
Tangible book value per share (1) $11.19  $10.86  $10.44  $10.04  $9.65  
                      
SELECTED FINANCIAL RATIOS                     
Net interest margin  3.66%  3.77%  3.77%  3.53%  3.30% 
Return on average assets  1.20%  1.55%  1.55%  1.45%  1.39% 
Return on average common stockholders' equity  13.97%  17.28%  17.36%  17.09%  16.71% 
Efficiency ratio  32.05%  34.02%  36.23%  37.58%  39.96% 
Non-interest expense to average earning assets  1.26%  1.38%  1.47%  1.43%  1.46% 
                      
CAPITAL RATIOS (2)                     
Common equity tier 1 capital to risk-weighted assets  9.51%  9.60%  9.72%  9.67%  9.78% 
Tier 1 capital to risk-weighted assets  9.52%  9.61%  9.73%  9.68%  9.78% 
Total capital to risk-weighted assets  11.52%  11.51%  11.67%  11.66%  11.84% 
Tier 1 capital to average assets  8.51%  8.91%  8.88%  8.46%  8.22% 
Tangible common equity to total tangible assets (1)  8.39%  8.59%  8.75%  8.39%  7.99% 
                      
(1) See "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" for a discussion of these Non-GAAP financial measures. 
(2) Regulatory capital ratios for most recent period are preliminary. 
  
  


           
CONSOLIDATED BALANCE SHEETS (UNAUDITED)          
(Dollars in thousands)          
    December 31, 2017 December 31, 2016 % Change 
ASSETS          
Cash and due from banks $86,213  $56,855  52% 
Interest-bearing balances due from depository institutions  151,849   566,707  (73)% 
Federal funds sold  239,524   160,435  49% 
 Cash and cash equivalents  477,586   783,997  (39)% 
Available for sale debt securities, at fair value  538,080   422,375  27% 
Held to maturity debt securities (fair value of $250 and $63,302 at          
 December 31, 2017 and 2016, respectively)  250   62,564  (100)% 
Restricted equity securities  1,034   1,024  1% 
Mortgage loans held for sale  4,459   4,675  (5)% 
Loans  5,851,261   4,911,770  19% 
Less allowance for loan losses  (59,406)  (51,893) 14% 
 Loans, net  5,791,855   4,859,877  19% 
Premises and equipment, net  58,900   40,314  46% 
Goodwill and other identifiable intangible assets  14,719   14,996  (2)% 
Other assets  195,501   180,626  8% 
 Total assets $7,082,384  $6,370,448  11% 
LIABILITIES AND STOCKHOLDERS' EQUITY          
Liabilities:          
Deposits:          
 Non-interest-bearing $1,440,326  $1,281,605  12% 
 Interest-bearing  4,651,348   4,138,706  12% 
  Total deposits  6,091,674   5,420,311  12% 
Federal funds purchased  301,797   355,944  (15)% 
Other borrowings  64,832   55,262  17% 
Other liabilities  16,477   16,042  3% 
 Total liabilities  6,474,780   5,847,559  11% 
Stockholders' equity:          
 Preferred stock, Series A Senior Non-Cumulative Perpetual, par value $0.001          
  (liquidation preference $1,000), net of discount; no shares authorized,          
  no shares issued or outstanding at December 31, 2017 and 2016  -   -  -% 
 Preferred stock, par value $0.001 per share; 1,000,000 shares authorized and          
  undesignated at December 31, 2017 and 2016  -   -  -% 
 Common stock, par value $0.001 per share; 100,000,000 shares authorized;           
  52,992,586 shares issued and outstanding at December 31, 2017 and          
  52,636,896 shares issued and outstanding at December 31, 2016  53   53  -% 
 Additional paid-in capital  217,693   215,932  1% 
 Retained earnings  389,597   307,151  27% 
 Accumulated other comprehensive income  (241)  (624) (61)% 
 Noncontrolling interest  502   377  33% 
  Total stockholders' equity  607,604   522,889  16% 
 Total liabilities and stockholders' equity $7,082,384  $6,370,448  11% 
              
              


           
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)          
(In thousands except per share data)             
    Three Months Ended December 31, Year Ended December 31, 
    2017 2016 2017 2016  
Interest income:             
 Interest and fees on loans $67,357 $52,533 $246,682 $200,463  
 Taxable securities  2,468  1,604  9,117  5,343  
 Nontaxable securities  702  785  2,948  3,300  
 Federal funds sold  508  377  1,693  1,007  
 Other interest and dividends  1,025  901  2,316  2,789  
 Total interest income  72,060  56,200  262,756  212,902  
Interest expense:             
 Deposits  8,954  5,817  28,831  20,169  
 Borrowed funds  1,698  1,274  6,502  5,636  
 Total interest expense  10,652  7,091  35,333  25,805  
 Net interest income  61,408  49,109  227,423  187,097  
Provision for loan losses  9,055  4,075  23,225  13,398  
 Net interest income after provision for loan losses  52,353  45,034  204,198  173,699  
Non-interest income:             
 Service charges on deposit accounts  1,499  1,375  5,702  5,355  
 Mortgage banking  894  1,044  3,835  3,725  
 Credit card income  1,298  1,052  4,815  3,207  
 Securities gains (losses)  -  -  -  (3) 
 Increase in cash surrender value life insurance  797  745  3,131  2,794  
 Other operating income  417  1,823  1,563  3,034  
 Total non-interest income  4,905  6,039  19,046  18,112  
Non-interest expense:             
 Salaries and employee benefits  11,432  11,197  47,604  43,955  
 Equipment and occupancy expense  1,566  1,877  8,018  7,985  
 Professional services  833  1,058  3,217  3,977  
 FDIC and other regulatory assessments  1,030  1,072  3,918  3,400  
 Other real estate owned expense  160  91  323  759  
 Other operating expense  6,234  6,742  22,814  20,917  
 Total non-interest expense  21,255  22,037  85,894  80,993  
 Income before income tax  36,003  29,036  137,350  110,818  
Provision for income tax  14,853  7,298  44,258  29,339  
 Net income  21,150  21,738  93,092  81,479  
 Dividends on preferred stock  31  24  62  47  
 Net income available to common stockholders $21,119 $21,714 $93,030 $81,432  
Basic earnings per common share $0.40 $0.41 $1.76 $1.55  
Diluted earnings per common share $0.39 $0.40 $1.72 $1.52  
               
               


                
LOANS BY TYPE (UNAUDITED)               
(In thousands)               
                 
   4th Quarter 2017 3rd Quarter 2017 2nd Quarter 2017 1st Quarter 2017 4th Quarter 2016
Commercial, financial and agricultural $2,279,366 $2,223,910 $2,123,498 $2,061,503 $1,982,267
Real estate - construction  580,874  467,838  395,398  345,777  335,085
Real estate - mortgage:               
 Owner-occupied commercial  1,328,666  1,323,383  1,272,659  1,262,578  1,171,719
 1-4 family mortgage  603,063  593,180  565,121  554,261  536,805
 Other mortgage  997,079  962,690  931,788  872,955  830,683
Subtotal: Real estate - mortgage  2,928,808  2,879,253  2,769,568  2,689,794  2,539,207
Consumer  62,213  57,764  55,224  54,910  55,211
Total loans $5,851,261 $5,628,765 $5,343,688 $5,151,984 $4,911,770
                
                


                   
SUMMARY OF LOAN LOSS EXPERIENCE (UNAUDITED)                  
(Dollars in thousands)                  
     4th Quarter 2017 3rd Quarter 2017 2nd Quarter 2017 1st Quarter 2017 4th Quarter 2016 
Allowance for loan losses:                     
Beginning balance $58,459  $55,059   $ 53,892   $ 51,893   $ 48,933  
Loans charged off:                     
 Commercial, financial and agricultural  7,064   924   3,067   2,855   1,059  
 Real estate - construction  -   16   40   -   -  
 Real estate - mortgage  1,134   550   106   266   45  
 Consumer  137   65   33   75   82  
  Total charge offs  8,335   1,555   3,246   3,196   1,186  
Recoveries:                     
 Commercial, financial and agricultural  64   67   16   190   10  
 Real estate - construction  126   12   14   16   12  
 Real estate - mortgage  26   59   2   2   46  
 Consumer  11   14   -   1   3  
  Total recoveries  227   152   32   209   71  
 Net charge-offs  8,108   1,403   3,214   2,987   1,115  
 Provision for loan losses  9,055   4,803   4,381   4,986   4,075  
 Ending balance $59,406  $58,459  $55,059  $53,892  $51,893  
                         
 Allowance for loan losses to total loans  1.02%  1.04%   1.03%   1.05%   1.06% 
 Allowance for loan losses to total average                     
  loans  1.04%  1.07%   1.05%   1.08%   1.10% 
 Net charge-offs to total average loans  0.56%  0.10%   0.25%   0.24%   0.09% 
 Provision for loan losses to total average                     
  loans  0.63%  0.35%   0.34%   0.40%   0.34% 
 Nonperforming assets:                     
  Nonaccrual loans $10,765  $12,356   $ 9,963   $ 12,084   $ 10,624  
  Loans 90+ days past due and accruing  60   2,506   1,016   16   6,263  
  Other real estate owned and                     
  repossessed assets  6,701   3,888   3,891   5,102   4,988  
 Total $17,526  $18,750  $14,870  $17,202  $21,875  
                         
 Nonperforming loans to total loans  0.19%  0.26%   0.21%   0.23%   0.34% 
 Nonperforming assets to total assets  0.25%  0.28%   0.23%   0.27%   0.34% 
 Nonperforming assets to earning assets  0.25%  0.29%   0.24%   0.28%   0.35% 
 Reserve for loan losses to nonaccrual loans  551.84%  473.12%   552.63%   445.98%   488.45% 
                         
 Restructured accruing loans $16,919  $12,700   $ 12,716   $ 536   $ 558  
                         
 Restructured accruing loans to total loans  0.29%  0.23%   0.24%   0.01%   0.01% 
                         
 TROUBLED DEBT RESTRUCTURINGS (TDRs) (UNAUDITED)              
 (In thousands)                 
     4th Quarter 2017 3rd Quarter 2017 2nd Quarter 2017 1st Quarter 2017 4th Quarter 2016 
 Beginning balance: $16,354  $16,370  $7,269  $7,292  $6,738  
  Additions  4,233   -   12,716   -   -  
  Removal from TDR  -   -   (535  -   -  
  Net (paydowns) / advances  (15  (16  (1,380  (23  554  
  Charge-offs  -   -   (1,700  -   -  
     $20,572  $16,354  $16,370  $7,269  $7,292  
                         
                         


           
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)          
(In thousands except per share data)          
    4th Quarter 2017 3rd Quarter 2017 2nd Quarter 2017 1st Quarter 2017 4th Quarter 2016 
Interest income:                
 Interest and fees on loans $67,357 $63,857 $59,912 $55,556 $52,533 
 Taxable securities  2,468  2,288  2,274  2,087  1,604 
 Nontaxable securities  702  729  752  765  785 
 Federal funds sold  508  379  287  519  377 
 Other interest and dividends  1,025  388  313  590  901 
 Total interest income  72,060  67,641  63,538  59,517  56,200 
Interest expense:                
 Deposits  8,954  7,574  6,321  5,982  5,817 
 Borrowed funds  1,698  1,671  1,650  1,483  1,274 
 Total interest expense  10,652  9,245  7,971  7,465  7,091 
 Net interest income  61,408  58,396  55,567  52,052  49,109 
Provision for loan losses  9,055  4,803  4,381  4,986  4,075 
 Net interest income after provision for loan losses  52,353  53,593  51,186  47,066  45,034 
Non-interest income:                
 Service charges on deposit accounts  1,499  1,467  1,382  1,354  1,375 
 Mortgage banking  894  978  1,064  899  1,044 
 Credit card income  1,298  1,149  1,189  1,179  1,052 
 Increase in cash surrender value life insurance  797  825  785  724  745 
 Other operating income  417  371  385  390  1,823 
 Total non-interest income  4,905  4,790  4,805  4,546  6,039 
Non-interest expense:                
 Salaries and employee benefits  11,432  12,428  12,031  11,713  11,197 
 Equipment and occupancy expense  1,566  1,947  2,265  2,250  1,877 
 Professional services  833  805  808  771  1,058 
 FDIC and other regulatory assessments  1,030  810  1,081  997  1,072 
 Other real estate owned expense  160  31  56  76  91 
 Other operating expense  6,234  5,476  5,634  5,460  6,742 
 Total non-interest expense  21,255  21,497  21,875  21,267  22,037 
 Income before income tax  36,003  36,886  34,116  30,345  29,036 
Provision for income tax  14,853  11,627  9,952  7,826  7,298 
 Net income  21,150  25,259  24,164  22,519  21,738 
 Dividends on preferred stock  31  -  31  -  24 
 Net income available to common stockholders $21,119 $25,259 $24,133 $22,519 $21,714 
Basic earnings per common share $0.40 $0.48 $0.46 $0.43 $0.41 
Diluted earnings per common share $0.39 $0.47 $0.45 $0.42 $0.40 
                 
                 


  
AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS (UNAUDITED) 
ON A FULLY TAXABLE-EQUIVALENT BASIS 
(Dollars in thousands) 
  
                                    
      4th Quarter 2017 3rd Quarter 2017 2nd Quarter 2017 1st Quarter 2017 4th Quarter 2016 
      Average Balance Yield /
Rate
 Average Balance Yield /
Rate
 Average Balance Yield /
Rate
 Average Balance Yield /
Rate
  Average Balance Yield /
Rate
 
Assets:                               
Interest-earning assets:                               
 Loans, net of unearned income (1)                               
  Taxable $5,680,227 4.68% $5,407,109 4.66% $5,192,812 4.60% $4,976,933  4.50% $4,676,565 4.45% 
  Tax-exempt (2)  36,992 4.95   33,357 5.17   41,143 4.92   27,322  4.72   26,344 4.74  
   Total loans, net of                                
    unearned income  5,717,219 4.68   5,440,466 4.66   5,233,955 4.60   5,004,255  4.51   4,702,909 4.45  
 Mortgage loans held for sale  6,199 3.52   4,862 3.51   5,958 3.90   5,637  4.10   6,271 3.36  
 Debt securities:                               
  Taxable  406,488 2.43   385,431 2.37   389,505 2.34   368,349  2.27   295,608 2.17  
  Tax-exempt (2)  128,201 3.27   131,478 3.34   133,590 3.38   132,578  3.45   134,748 3.54  
   Total securities (3)  534,689 2.63   516,909 2.62   523,095 2.60   500,927  2.58   430,356 2.60  
 Federal funds sold  143,905 1.40   111,175 1.35   98,598 1.17   234,460  0.90   242,211 0.62  
 Restricted equity securities  1,030 1.93   1,030 3.47   1,030 10.51   1,030  1.57   3,042 8.24  
 Interest-bearing balances with banks  310,289 1.31   118,510 1.27   109,909 1.04   295,648  0.80   601,143 0.55  
 Total interest-earning assets $6,713,331 4.29% $6,192,952 4.37% $5,972,545 4.30% $6,041,957  4.03% $5,985,932 3.77% 
Non-interest-earning assets:                               
 Cash and due from banks  68,444     65,457     68,894     59,697      55,593    
 Net premises and equipment  57,320     54,727     49,813     44,739      30,421    
 Allowance for loan losses, accrued                               
  interest and other assets  149,636     151,786     143,286     138,289      140,721    
   Total assets $6,988,731    $6,464,922    $6,234,538    $6,284,682     $6,212,667    
                                    
Interest-bearing liabilities:                               
 Interest-bearing deposits: