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Reliant Bancorp, Inc. Reports Record Second Quarter 2021 Results

Reported Net Income of $13.0 million, or Diluted EPS of $0.78

Reliant Bancorp, Inc. (“Reliant Bancorp” or the “Company”) (Nasdaq: RBNC), parent company of Reliant Bank (the “Bank”), reported net income attributable to common shareholders of $13.0 million, or $0.78 per diluted common share, for the second quarter of 2021 compared to net income attributable to common shareholders of $12.1 million, or $0.73 per diluted common share, for the first quarter of 2021, and $7.9 million, or $0.48 per diluted common share, for the second quarter of 2020.

DeVan Ard, Jr., Reliant Bancorp's Chairman and CEO stated, “I am very pleased to continue 2021 with solid second quarter results as evidenced by our record earnings, sound asset quality, and increasing loan production. Loan growth has continued to accelerate with a 1.9% increase from the prior quarter. When PPP loans are excluded, loan growth increases to 3.2%, or 12.8% when annualized.”

Ard continued, “Our team delivered another outstanding quarter of deposit growth. Balances in non-time deposits - checking, savings, and money market deposits - grew 6.3%, or 25.1% annualized, during the second quarter, which can be largely attributed to the effort by our team to build lasting relationships with our customers. We also continued to build shareholder value as our book value and tangible book value per share increased 4.3% and 5.5%, respectively, from the prior quarter, or 17.1% and 22.1%, respectively, when annualized. Additionally, shareholders’ equity to total assets and tangible common equity to tangible assets have increased to 11.18% and 9.28%, respectively, which positions us for further growth opportunities and allows us to continue to deliver exceptional shareholder returns.”

Second Quarter Highlights

Dollar Amounts in Thousands, Except Per Share Amounts

 

 

2021

 

2020

 

Second Quarter

 

First Quarter

 

Second Quarter

Results of Operations Highlights

 

 

 

 

 

Net income attributable to common shareholders

$

13,045

 

 

$

12,149

 

 

$

7,868

 

Net income per diluted common share

$

0.78

 

 

$

0.73

 

 

$

0.48

 

Net interest margin (NIM) (1)

 

4.14

%

 

 

4.51

%

 

 

4.58

%

Adjusted NIM (2)

 

4.28

%

 

 

4.24

%

 

 

3.81

%

Adjusted pre-tax pre-provision income (2)

$

16,387

 

 

$

15,699

 

 

$

12,114

 

Efficiency ratio (tax equivalent basis)

 

54.1

%

 

 

56.4

%

 

 

62.7

%

Bank segment adjusted efficiency ratio (2)

 

49.1

%

 

 

50.8

%

 

 

50.7

%

 

 

 

 

 

 

Balance Sheet Highlights

 

 

 

 

 

Loans

$

2,321,070

 

 

$

2,277,714

 

 

$

2,317,324

 

Allowance for loan losses

 

(20,894

)

 

 

(20,785

)

 

 

(18,237

)

Total assets

 

3,098,464

 

 

 

3,057,066

 

 

 

2,990,126

 

Total deposits

 

2,629,840

 

 

 

2,612,910

 

 

 

2,530,014

 

Book value per share

$

20.77

 

 

$

19.92

 

 

$

17.77

 

Tangible book value per share (2)

$

16.88

 

 

$

16.00

 

 

$

13.96

 

 

 

 

 

 

 

Return on average: (3)

 

 

 

 

 

Assets ("ROAA")

 

1.69

%

 

 

1.64

%

 

 

1.07

%

Equity ("ROAE")

 

15.41

%

 

 

15.07

%

 

 

10.95

%

Tangible common equity ("ROATCE") (2)

 

19.07

%

 

 

18.84

%

 

 

14.04

%

(1)

Net interest margin is the result of annualized net interest income calculated on a tax-equivalent basis divided by average interest-earning assets for the period.

(2)

Certain measures are considered non-GAAP financial measures. See “Reconciliation of Non-GAAP Financial Measures.”

(3)

Data has been annualized.

Profitability Remains Strong Through Asset Mix Optimization

Net interest margin decreased to 4.14% at June 30, 2021, a decrease of 37 basis points from the previous quarter and a decrease of 44 basis points from the second quarter of 2020. The linked quarter decrease was primarily due to a 30 basis point increase in our cost of funds due to a $2,859 swap termination fee incurred during the quarter. The adjusted net interest margin, which excludes this fee impact as well as the benefits from purchase accounting accretion, showed continued improvement as it increased 4 basis points from the linked quarter to 4.28%. Net income and earnings per share during the quarter were not affected by this termination fee as securities were sold for a gain of $2,966 to offset the transaction.

Loan yields remain strong at 5.58% with a decrease of 5 basis points from the linked quarter. The 40 basis point decrease from the same period in the prior year can largely be attributed to the decrease in purchase accounting accretion. As of June 30, 2021, $13.0 million of purchase accounting accretion and $184 thousand in PPP deferred fees remain to be realized.

While the cost of funds increased to 0.97% during the quarter due to the impact of the swap termination, the cost of interest-bearing retail deposits decreased 40 basis points from the linked quarter and 89 basis points from the same quarter in the prior year driven by a continued focus on improving the funding mix and attracting and retaining core deposits. Deposits increased $16.9 million from the linked quarter and $99.8 million year-over-year with non-time deposits making up $120.7 million and $467.3 million of the increases, respectively. Noninterest-bearing deposits increased $23.8 million from the linked quarter while time deposits decreased $103.7 million.

Ard stated, “Our team continues to attract and retain low cost deposits in a competitive environment, fulfilling one of our strategic goals and helping us to better serve the community's credit needs.”

Continued Loan Growth and Asset Quality Stability

Loans have increased $43.4 million from the linked quarter to $2.3 billion. Loan originations during the quarter totaled $280.2 million at a weighted-average coupon rate of 4.16% with a continued focus on credit quality through sound underwriting. These originations were offset with principal payments, including PPP forgiveness payments of $27.9 million. When PPP loans are excluded, loans increased $71.3 million, or 3.2%, from the linked quarter and $73.0 million, or 3.3%, year-over-year.

Our longstanding focus on credit quality continues to be a source of strength with net recoveries in the first quarter continuing into the second quarter. Nonperforming loans held for investment accounted for 0.23% of total loans held for investment and nonperforming assets accounted for only 0.31% of total assets at June 30, 2021, despite the addition of a retired bank facility to other real estate owned during the quarter. Criticized assets to total loans remains low at 0.87%. The allowance for loan loss was 0.90% of loans (1.46% including unaccreted net purchased loan discounts) at June 30, 2021. There was no provision recognized during the quarter as net charge-offs were in a recovery position for the quarter and year-to-date.

Conclusion

Ard concluded, “I am proud of our team’s ability to serve the community and our shareholders as well as our ability to create meaningful careers and a positive workplace for our employees as evidenced through the Tennesseans recognition as a 2021 Top Workplace. We continue to see increased demand in the loan pipeline as we move into the third quarter, and we are optimistic about our market and financial positions as we continue to build a bright future for Reliant Bank.”

About Reliant Bancorp, Inc. and Reliant Bank

Reliant Bancorp, Inc. is a Brentwood, Tennessee-based financial holding company which, through its wholly owned subsidiary Reliant Bank, operates banking centers in Tennessee. Reliant Bank is a full-service commercial bank that offers a variety of deposit, lending, and mortgage products and services to business and consumer customers. As of June 30, 2021, Reliant Bancorp had approximately $3.1 billion in total consolidated assets, approximately $2.3 billion in loans held for investment and approximately $2.6 billion in deposits. For additional information, locations and hours of operation, please visit www.reliantbank.com.

Financial Measures

This release contains certain financial measures that are not measures recognized under generally accepted accounting principles (“GAAP”) and, therefore, are considered non-GAAP financial measures. Members of Company management use these non-GAAP financial measures in their analysis of the Company’s performance, financial condition, and efficiency of operations. Management of the Company believes that these non-GAAP financial measures provide a greater understanding of ongoing operations, enhance comparability of results with prior periods, and demonstrate the effects of significant gains and charges in the periods presented. Management of the Company also believes that investors find these non-GAAP financial measures useful as they assist investors in understanding underlying operating performance and identifying and analyzing ongoing operating trends. However, the non-GAAP financial measures discussed herein should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which the non-GAAP financial measures discussed herein are calculated may differ from the manner in which measures with similar names are calculated by other companies. You should understand how other companies calculate their financial measures similar to, or with names similar to, the non-GAAP financial measures we have discussed herein when comparing such non-GAAP financial measures.

The non-GAAP measures in this release include “adjusted net interest margin (NIM),” “adjusted net income,” “adjusted diluted earnings per share (EPS),” “adjusted annualized return on average assets (ROAA),” “adjusted annualized return on average equity (ROAE),” “adjusted annualized return on average tangible common equity (ROATCE),” “adjusted pre-tax pre-provision income,” “tangible common equity to tangible assets (TCE/TA),” “tangible book value per share,” “allowance for loan losses plus unaccreted purchased loan discounts to total loans,” “bank segment adjusted net income,” “bank segment adjusted noninterest expense,” “bank segment adjusted efficiency ratio,” “adjusted cost of funds,” “adjusted cost of interest-bearing liabilities,” and “adjusted cost of deposits.”

Forward-Looking Statements

All statements, other than statements of historical fact, included in this release and any oral statements made regarding the subject of this release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements relating to increased demand in the loan pipeline and management’s optimism about the Company’s market and financial positions. The words “believe,” “anticipate,” “expect,” “may,” “will,” “assume,” “should,” “predict,” “could,” “would,” “intend,” “targets,” “estimates,” “projects,” “plans,” and “potential,” and other similar words and expressions of the future, are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking, including statements about the Company’s future financial and operating results and the Company’s plans, objectives, and intentions. All forward-looking statements are subject to risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of the Company to differ materially from any results, performance, or achievements expressed or implied by such forward-looking statements. Such risks, uncertainties, and other factors include, among others: (1) the effects of the coronavirus (COVID-19) pandemic, including (i) the magnitude and duration of the pandemic and its impact on general economic and financial market conditions and on our business, results of operations, and financial condition and that of our customers, (ii) actions taken by governments, businesses and individuals in response to the coronavirus (COVID-19) pandemic, (iii) the pace of recovery when the coronavirus (COVID-19) pandemic subsides, and (iv) the speed with which coronavirus (COVID-19) vaccines can be widely distributed, those vaccines’ efficacy against the virus and public acceptance of the vaccines, (2) the possibility that our asset quality could decline or that we experience greater loan losses than anticipated, (3) increased levels of other real estate, primarily as a result of foreclosures, (4) the impact of liquidity needs on our results of operations and financial condition, (5) competition from financial institutions and other financial service providers, (6) the effect of interest rate increases on the cost of deposits, (7) unanticipated weakness in loan demand or loan pricing, (8) greater than anticipated adverse conditions in the national economy or local economies in which we operate, including in Middle Tennessee, (9) lack of strategic growth opportunities or our failure to execute on available opportunities, (10) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses, (11) economic crises and associated credit issues in industries most impacted by the coronavirus (COVID-19) pandemic, including the hotel and retail sectors, (12) the ability to grow and retain low-cost core deposits and retain large, uninsured deposits, (13) our ability to effectively manage problem credits, (14) our ability to successfully implement efficiency initiatives on time and with the results projected, (15) our ability to successfully develop and market new products and technology, (16) the impact of negative developments in the financial industry and United States and global capital and credit markets, (17) our ability to retain the services of key personnel, (18) our ability to adapt to technological changes, (19) risks associated with litigation, including reputational and financial risks and the applicability of insurance coverage, (20) the vulnerability of the Bank’s computer and information technology systems and networks, and the systems and networks of third parties with whom the Company or the Bank contract, to unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss, and other security breaches and interruptions, (21) changes in state and federal laws, rules, regulations, or policies applicable to banks or bank or financial holding companies, including regulatory or legislative developments, (22) adverse impacts (including costs, fines, reputational harm, or other negative effects) from current or future litigation, regulatory examinations, or other legal and/or regulatory actions, (23) the risk of successful integration of the businesses the Company has recently acquired, (24) the ability to meet expectations regarding the timing and completion and accounting and tax treatment of the pending transaction with United Community Banks, Inc. (the “Transaction”), (25) the effect of the announcement and pendency of the Transaction on customer, supplier, or employee relationships and operating results (including without limitation difficulties in maintaining relationships with employees and customers), as well as on the market price of the Company's common stock, (26) the occurrence of any event, change, or other circumstances that could give rise to the termination of the definitive merger agreement for the Transaction, (27) the amount of costs, fees, expenses and charges related to the Transaction, including those arising as a result of unexpected factors or events, (28) the ability to obtain the shareholder and governmental approvals required for the Transaction, (29) reputational risk associated with and the reaction of the parties' customers, suppliers, employees, or other business partners to the Transaction, (30) the failure of any of the conditions to the closing of the Transaction to be satisfied, or any unexpected delay in closing the Transaction, (31) the risk associated with Company management's attention being diverted away from the day-to-day business and operations of the Company to the completion of the Transaction, and (32) general competitive, economic, political, and market conditions, including economic conditions in the local markets where we operate. Additional factors which could affect the forward-looking statements can be found in the Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) and available on the SEC’s website at http://www.sec.gov. The Company believes the forward-looking statements contained herein are reasonable; however, many of such risks, uncertainties, and other factors are beyond the Company’s ability to control or predict and undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. Therefore, the Company can give no assurance that its future results will be as estimated. The Company does not intend to, and disclaims any obligation to, update or revise any forward-looking statement.

RELIANT BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

(Dollar amounts in thousands, except per share amounts)

 

 

June 30, 2021

 

March 31, 2021

 

June 30, 2020

ASSETS

(Unaudited)

 

(Unaudited)

 

(Unaudited)

Cash and due from banks

$

11,763

 

 

$

13,105

 

 

$

12,805

 

Interest-bearing deposits in financial institutions

43,676

 

 

104,620

 

 

81,033

 

Federal funds sold

656

 

 

186

 

 

638

 

Total cash and cash equivalents

56,095

 

 

117,911

 

 

94,476

 

Securities available for sale

266,695

 

 

267,191

 

 

249,014

 

Loans

2,321,070

 

 

2,277,714

 

 

2,317,324

 

Less: allowance for loan losses

(20,894)

 

 

(20,785)

 

 

(18,237)

 

Loans, net

2,300,176

 

 

2,256,929

 

 

2,299,087

 

Mortgage loans held for sale, net

229,418

 

 

166,599

 

 

101,579

 

Accrued interest receivable

14,492

 

 

14,568

 

 

13,579

 

Premises and equipment, net

29,183

 

 

30,879

 

 

33,524

 

Operating leases right of use assets

12,744

 

 

13,372

 

 

15,452

 

Restricted equity securities, at cost

15,770

 

 

16,146

 

 

17,509

 

Other real estate, net

2,233

 

 

1,198

 

 

2,514

 

Cash surrender value of life insurance contracts

78,979

 

 

78,423

 

 

67,723

 

Deferred tax assets, net

5,978

 

 

7,453

 

 

9,787

 

Goodwill

54,396

 

 

54,396

 

 

51,058

 

Core deposit intangibles

10,434

 

 

10,891

 

 

12,293

 

Other assets

21,871

 

 

21,110

 

 

22,531

 

TOTAL ASSETS

$

3,098,464

 

 

$

3,057,066

 

 

$

2,990,126

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

Deposits

 

 

 

 

 

Noninterest-bearing demand

$

602,555

 

 

$

578,764

 

 

$

534,353

 

Interest-bearing demand

441,161

 

 

397,047

 

 

273,993

 

Savings and money market deposit accounts

1,003,402

 

 

950,630

 

 

771,505

 

Time

582,722

 

 

686,469

 

 

950,163

 

Total deposits

2,629,840

 

 

2,612,910

 

 

2,530,014

 

Accrued interest payable

1,967

 

 

3,087

 

 

3,100

 

Subordinated debentures

70,770

 

 

70,719

 

 

70,413

 

Federal Home Loan Bank advances

16,000

 

 

 

 

49,121

 

Operating leases liabilities

13,932

 

 

14,552

 

 

16,591

 

Other liabilities

19,666

 

 

24,099

 

 

25,344

 

TOTAL LIABILITIES

2,752,175

 

 

2,725,367

 

 

2,694,583

 

Preferred stock, $1 par value per share; 10,000,000 shares authorized; no shares issued to date

 

 

 

 

 

Common stock, $1 par value per share; 30,000,000 shares authorized; 16,672,511, 16,654,415, and 16,631,604 shares issued and outstanding at June 30, 2021, March 31, 2021, and June 30, 2020, respectively

16,673

 

 

16,654

 

 

16,632

 

Additional paid-in capital

234,390

 

 

233,667

 

 

232,436

 

Retained earnings

86,917

 

 

75,891

 

 

45,351

 

Accumulated other comprehensive income

8,309

 

 

5,487

 

 

1,124

 

TOTAL SHAREHOLDERS’ EQUITY

346,289

 

 

331,699

 

 

295,543

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$

3,098,464

 

 

$

3,057,066

 

 

$

2,990,126

 

 

This information is preliminary and based on company data available at the time of presentation.

RELIANT BANCORP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED

(Dollar amounts in thousands, except per share amounts)

 

Three Months Ended

 

June 30,

2021

 

March 31,

2021

 

June 30,

2020

INTEREST INCOME

 

 

 

 

 

Interest and fees on loans

$

31,183

 

 

$

30,989

 

 

$

33,447

Interest and fees on loans held for sale

 

1,807

 

 

 

1,331

 

 

 

815

Interest on investment securities, taxable

 

663

 

 

 

610

 

 

 

128

Interest on investment securities, nontaxable

 

1,216

 

 

 

1,225

 

 

 

1,317

Restricted equity securities and other

 

226

 

 

 

227

 

 

 

208

TOTAL INTEREST INCOME

 

35,095

 

 

 

34,382

 

 

 

35,915

INTEREST EXPENSE

 

 

 

 

 

Deposits

 

 

 

 

 

Demand

 

216

 

 

 

272

 

 

 

218

Savings and money market deposit accounts

 

647

 

 

 

839

 

 

 

1,476

Time

 

4,678

 

 

 

2,288

 

 

 

3,135

Federal Home Loan Bank advances and other borrowings

 

13

 

 

 

4

 

 

 

148

Subordinated debentures

 

980

 

 

 

953

 

 

 

982

TOTAL INTEREST EXPENSE

 

6,534

 

 

 

4,356

 

 

 

5,959

NET INTEREST INCOME

 

28,561

 

 

 

30,026

 

 

 

29,956

PROVISION FOR LOAN LOSSES

 

 

 

 

 

 

 

3,000

NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES

 

28,561

 

 

 

30,026

 

 

 

26,956

NONINTEREST INCOME

 

 

 

 

 

Service charges on deposit accounts

 

1,656

 

 

 

1,561

 

 

 

1,381

Gains on mortgage loans sold, net

 

2,978

 

 

 

4,928

 

 

 

2,248

Gain (loss) on securities transactions, net

 

2,966

 

 

 

129

 

 

 

327

Other noninterest income

 

710

 

 

 

719

 

 

 

466

TOTAL NONINTEREST INCOME

 

8,310

 

 

 

7,337

 

 

 

4,422

NONINTEREST EXPENSE

 

 

 

 

 

Salaries and employee benefits

 

12,793

 

 

 

13,352

 

 

 

12,464

Occupancy

 

1,999

 

 

 

2,008

 

 

 

2,026

Data processing and software

 

2,262

 

 

 

2,229

 

 

 

2,026

Professional fees

 

358

 

 

 

1,243

 

 

 

680

Regulatory fees

 

343

 

 

 

361

 

 

 

537

Merger expenses

 

 

 

 

 

 

 

2,632

Other operating expense

 

2,729

 

 

 

2,471

 

 

 

1,899

TOTAL NONINTEREST EXPENSE

 

20,484

 

 

 

21,664

 

 

 

22,264

INCOME BEFORE PROVISION FOR INCOME TAXES

 

16,387

 

 

 

15,699

 

 

 

9,114

INCOME TAX EXPENSE

 

3,202

 

 

 

2,980

 

 

 

1,634

CONSOLIDATED NET INCOME

 

13,185

 

 

 

12,719

 

 

 

7,480

NONCONTROLLING INTEREST IN NET (INCOME) LOSS OF SUBSIDIARY

 

(140

)

 

 

(570

)

 

 

388

NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS

$

13,045

 

 

$

12,149

 

 

$

7,868

Basic net income attributable to common shareholders, per share

$

0.79

 

 

$

0.73

 

 

$

0.48

Diluted net income attributable to common shareholders, per share

$

0.78

 

 

$

0.73

 

 

$

0.48

 

This information is preliminary and based on company data available at the time of presentation.

RELIANT BANCORP, INC.

SEGMENT FINANCIAL INFORMATION - UNAUDITED

(Dollar Amounts in Thousands)

 

 

Three Months Ended

June 30, 2021

 

Commercial

Banking

 

Residential

Mortgage

Banking

 

Elimination

Entries

 

Consolidated

Net interest income

$

27,440

 

$

1,121

 

 

$

 

 

$

28,561

 

Provision for loan losses

 

 

 

 

 

 

 

 

 

 

Noninterest income

 

5,335

 

 

3,251

 

 

 

(276

)

 

 

8,310

 

Noninterest expense (excluding merger expense)

 

16,570

 

 

3,914

 

 

 

 

 

 

20,484

 

Merger expense

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

3,160

 

 

42

 

 

 

 

 

 

3,202

 

Net income

 

13,045

 

 

416

 

 

 

(276

)

 

 

13,185

 

Noncontrolling interest in net income of subsidiary

 

 

 

(416

)

 

 

276

 

 

 

(140

)

Net income attributable to common shareholders

$

13,045

 

$

 

 

$

 

 

$

13,045

 

 

 

Three Months Ended

March 31, 2021

 

Commercial

Banking

 

Residential

Mortgage

Banking

 

Elimination

Entries

 

Consolidated

Net interest income

$

29,133

 

$

893

 

 

$

 

 

$

30,026

 

Provision for loan losses

 

 

 

 

 

 

 

 

 

 

Noninterest income

 

2,409

 

 

5,033

 

 

 

(105

)

 

 

7,337

 

Noninterest expense (excluding merger expense)

 

16,460

 

 

5,204

 

 

 

 

 

 

21,664

 

Merger expense

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

2,933

 

 

47

 

 

 

 

 

 

2,980

 

Net income

 

12,149

 

 

675

 

 

 

(105

)

 

 

12,719

 

Noncontrolling interest in net income of subsidiary

 

 

 

(675

)

 

 

105

 

 

 

(570

)

Net income attributable to common shareholders

$

12,149

 

$

 

 

$

 

 

$

12,149

 

 

 

Three Months Ended

June 30, 2020

 

Commercial

Banking

 

Residential

Mortgage

Banking

 

Elimination

Entries

 

Consolidated

Net interest income

$

29,420

 

$

536

 

 

$

 

 

$

29,956

 

Provision for loan losses

 

3,000

 

 

 

 

 

 

 

 

3,000

 

Noninterest income

 

2,174

 

 

2,240

 

 

 

8

 

 

 

4,422

 

Noninterest expense (excluding merger expense)

 

16,433

 

 

3,199

 

 

 

 

 

 

19,632

 

Merger expense

 

2,632

 

 

 

 

 

 

 

 

2,632

 

Income tax (benefit) expense

 

1,661

 

 

(27

)

 

 

 

 

 

1,634

 

Net (loss) income

 

7,868

 

 

(396

)

 

 

8

 

 

 

7,480

 

Noncontrolling interest in net loss of subsidiary

 

 

 

396

 

 

 

(8

)

 

 

388

 

Net income attributable to common shareholders

$

7,868

 

$

 

 

$

 

 

$

7,868

 

 

This information is preliminary and based on company data available at the time of presentation.

RELIANT BANCORP, INC.

SELECTED QUARTERLY FINANCIAL DATA - UNAUDITED

 

(Dollar amounts in thousands, except per share amounts)

Three months ended,

 

June 30, 2021

 

March 31, 2021

 

June 30, 2020

Per Common Share

 

 

 

 

 

Basic net income

$

0.79

 

 

$

0.73

 

 

$

0.48

 

Diluted net income

$

0.78

 

 

$

0.73

 

 

$

0.48

 

Adjusted diluted income(1)

$

0.78

 

 

$

0.73

 

 

$

0.60

 

Book value

$

20.77

 

 

$

19.92

 

 

$

17.77

 

Tangible book value(1)

$

16.88

 

 

$

16.00

 

 

$

13.96

 

Shares Outstanding

 

 

 

 

 

Basic weighted average common shares

 

16,616,888

 

 

 

16,615,169

 

 

 

16,496,817

 

Diluted weighted average common shares

 

16,784,744

 

 

 

16,740,303

 

 

 

16,529,080

 

Common shares outstanding at period end

 

16,672,511

 

 

 

16,654,415

 

 

 

16,631,604

 

Selected Balance Sheet Data

 

 

 

 

 

Loans, net of unearned income

$

2,321,070

 

 

$

2,277,714

 

 

$

2,317,324

 

Total assets

 

3,098,464

 

 

 

3,057,066

 

 

 

2,990,126

 

Customer deposits

 

2,320,054

 

 

 

2,350,168

 

 

 

2,177,734

 

Wholesale and institutional deposits

 

309,786

 

 

 

262,742

 

 

 

352,280

 

Total deposits

 

2,629,840

 

 

 

2,612,910

 

 

 

2,530,014

 

Total liabilities

 

2,752,175

 

 

 

2,725,367

 

 

 

2,694,583

 

Total shareholders' equity

 

346,289

 

 

 

331,699

 

 

 

295,543

 

Selected Balance Sheet Data - Quarterly Averages

 

 

 

 

 

Loans held for investment

$

2,288,841

 

 

$

2,280,379

 

 

$

2,302,639

 

Total assets

 

3,088,329

 

 

 

3,013,114

 

 

 

2,956,942

 

Interest-bearing liabilities

 

2,113,993

 

 

 

2,079,238

 

 

 

2,158,990

 

Total liabilities

 

2,748,825

 

 

 

2,686,085

 

 

 

2,667,981

 

Total shareholders' equity

 

339,504

 

 

 

327,029

 

 

 

288,961

 

Selected Performance Ratios

 

 

 

 

 

Return on average assets (2)

 

1.69

%

 

 

1.64

%

 

 

1.07

%

Return on shareholders' equity (2)

 

15.41

%

 

 

15.07

%

 

 

10.95

%

Return on average tangible common equity(1) (2)

 

19.07

%

 

 

18.84

%

 

 

14.04

%

Average shareholders' equity to average assets

 

10.99

%

 

 

10.85

%

 

 

9.77

%

Net interest margin (tax-equivalent basis) (2)

 

4.14

%

 

 

4.51

%

 

 

4.58

%

Efficiency Ratio (tax-equivalent basis)

 

54.1

%

 

 

56.4

%

 

 

62.7

%

Bank Segment efficiency ratio (1)

 

49.1

%

 

 

50.8

%

 

 

50.7

%

Loans held for investment to deposits ratio

 

88.3

%

 

 

87.2

%

 

 

91.6

%

Interest Rates and Yields (2)

 

 

 

 

 

Yield on interest-earning assets

 

5.05

%

 

 

5.14

%

 

 

5.45

%

Yield on loans held for investment

 

5.58

%

 

 

5.63

%

 

 

5.98

%

Cost of interest-bearing liabilities

 

1.24

%

 

 

0.85

%

 

 

1.11

%

Adjust cost of interest-bearing liabilities (1)

 

0.70

%

 

 

0.85

%

 

 

1.11

%

Cost of funds

 

0.97

%

 

 

0.67

%

 

 

0.91

%

Adjusted cost of funds (1)

 

0.54

%

 

 

0.67

%

 

 

0.91

%

Cost of total deposits

 

0.83

%

 

 

0.51

%

 

 

0.79

%

Adjusted cost of total deposits (1)

 

0.41

%

 

 

0.51

%

 

 

0.79

%

Preliminary Consolidated Capital Ratios (3)

 

 

 

 

 

Tier 1 leverage

 

9.47

%

 

 

9.33

%

 

 

8.47

%

Common equity tier 1

 

10.18

%

 

 

10.41

%

 

 

9.25

%

Tier 1 risk-based capital

 

10.62

%

 

 

10.88

%

 

 

9.71

%

Total risk-based capital

 

13.62

%

 

 

14.09

%

 

 

12.80

%

Selected Asset Quality Measures

 

 

 

 

 

Allowance for loan losses to total loans

 

0.90

%

 

 

0.91

%

 

 

0.79

%

Allowance for loan losses and purchase loan discounts to total loans

 

1.46

%

 

 

1.56

%

 

 

1.73

%

Net (recoveries) charge offs

$

(109

)

 

$

(149

)

 

$

(116

)

Net (recoveries) charge offs to average loans (2)

 

(0.02

)%

 

 

(0.03

)%

 

 

(0.02

)%

Total nonperforming loans held for investment (HFI)

$

5,355

 

 

$

6,110

 

 

$

7,549

 

Total nonperforming assets (4)

$

9,726

 

 

$

9,661

 

 

$

11,571

 

Nonperforming loans HFI to total loans HFI

 

0.23

%

 

 

0.27

%

 

 

0.33

%

Nonperforming assets to total assets

 

0.31

%

 

 

0.32

%

 

 

0.39

%

Nonperforming assets to total loans HFI and NPAs

 

0.42

%

 

 

0.42

%

 

 

0.50

%

(1)

Certain measures are considered non-GAAP financial measures. See “Reconciliation of Non-GAAP Financial Measures”.

(2)

Data has been annualized.

(3)

Current quarter capital ratios are estimated

(4)

Nonperforming assets consist of nonperforming loans held for investment, nonperforming loans held for sale, repossessed assets, and other real estate.

 

This information is preliminary and based on company data available at the time of presentation.

RELIANT BANCORP, INC.

YIELD TABLES - UNAUDITED

FOR THE PERIODS INDICATED

(Dollar Amounts in Thousands)

The following table sets forth the amount of our average balances, interest income or interest expense for each category of interest-earning assets and interest-bearing liabilities and the average interest rate for interest-earning assets and interest-bearing liabilities, net interest spread and net interest margin for the periods indicated below:

 

 

Three Months Ended

June 30, 2021

 

Three Months Ended

March 31, 2021

 

Three Months Ended

June 30, 2020

 

Average

Balances (1)

Rates /

Yields

(%)

Interest

Income /

Expense

 

Average

Balances (1)

Rates /

Yields

(%)

Interest

Income /

Expense

 

Average

Balances (1)

Rates /

Yields

(%)

Interest

Income /

Expense

Interest earning assets

 

 

 

 

 

 

 

 

 

 

 

Loans (2) (3)

$

2,288,841

 

5.12

 

 

$

28,539

 

$

2,280,379

 

5.15

 

 

$

28,288

 

$

2,302,639

 

5.68

 

 

$

31,708

Loan fees

 

 

0.46

 

 

 

2,644

 

 

 

0.48

 

 

 

2,701

 

 

 

0.30

 

 

 

1,739

Loans with fees

 

2,288,841

 

5.58

 

 

 

31,183

 

 

2,280,379

 

5.63

 

 

 

30,989

 

 

2,302,639

 

5.98

 

 

 

33,447

Mortgage loans held for sale

 

232,850

 

3.11

 

 

 

1,807

 

 

169,747

 

3.18

 

 

 

1,331

 

 

85,313

 

3.84

 

 

 

815

Deposits with banks

 

58,619

 

0.36

 

 

 

52

 

 

61,939

 

0.34

 

 

 

52

 

 

66,052

 

0.30

 

 

 

50

Investment securities - taxable

 

73,368

 

3.62

 

 

 

663

 

 

65,499

 

3.78

 

 

 

610

 

 

66,234

 

0.78

 

 

 

128

Investment securities - tax-exempt (4)

 

197,309

 

3.19

 

 

 

1,216

 

 

198,034

 

3.24

 

 

 

1,225

 

 

193,216

 

3.51

 

 

 

1,317

Restricted equity securities and other

 

17,816

 

3.92

 

 

 

174

 

 

17,321

 

4.10

 

 

 

175

 

 

21,950

 

2.90

 

 

 

158

Total earning assets

 

2,868,803

 

5.05

 

 

 

35,095

 

 

2,792,919

 

5.14

 

 

 

34,382

 

 

2,735,404

 

5.45

 

 

 

35,915

Nonearning assets

 

219,526

 

 

 

 

 

 

220,195

 

 

 

 

 

 

221,538

 

 

 

 

Total assets

$

3,088,329

 

 

 

 

 

$

3,013,114

 

 

 

 

 

$

2,956,942

 

 

 

 

Interest bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest bearing demand

$

412,117

 

0.21

 

 

$

216

 

$

377,714

 

0.29

 

 

$

272

 

$

279,092

 

0.31

 

 

$

218

Savings and money market

 

972,082

 

0.27

 

 

 

647

 

 

901,444

 

0.38

 

 

 

839

 

 

731,278

 

0.81

 

 

 

1,476

Time deposits - retail

 

443,512

 

0.94

 

 

 

1,042

 

 

494,508

 

1.15

 

 

 

1,404

 

 

749,566

 

1.19

 

 

 

2,217

Time deposits - wholesale

 

192,954

 

7.56

 

 

 

3,636

 

 

227,513

 

1.58

 

 

 

884

 

 

201,307

 

1.83

 

 

 

918

Total interest-bearing deposits

 

2,020,665

 

1.10

 

 

 

5,541

 

 

2,001,179

 

0.69

 

 

 

3,399

 

 

1,961,243

 

0.99

 

 

 

4,829

Federal Home Loan Bank advances and other borrowings

 

22,582

 

0.23

 

 

 

13

 

 

7,467

 

0.22

 

 

 

4

 

 

127,350

 

0.47

 

 

 

148

Subordinated debt

 

70,746

 

5.56

 

 

 

980

 

 

70,592

 

5.48

 

 

 

953

 

 

70,397

 

5.61

 

 

 

982

Total borrowed funds

 

93,328

 

4.27

 

 

 

993

 

 

78,059

 

4.97

 

 

 

957

 

 

197,747

 

2.30

 

 

 

1,130

Total interest-bearing liabilities

 

2,113,993

 

1.24

 

 

 

6,534

 

 

2,079,238

 

0.85

 

 

 

4,356

 

 

2,158,990

 

1.11

 

 

 

5,959

Net interest spread (5)

 

 

3.81

 

 

 

28,561

 

 

 

4.29

 

 

 

30,026

 

 

 

4.34

 

 

 

29,956

Noninterest bearing deposits

 

597,188

 

(0.27

)

 

 

 

 

565,770

 

(0.18

)

 

 

 

 

468,575

 

(0.20

)

 

 

Other noninterest bearing liabilities

 

37,644

 

 

 

 

 

 

41,077

 

 

 

 

 

 

40,416

 

 

 

 

Shareholders' equity

 

339,504

 

 

 

 

 

 

327,029

 

 

 

 

 

 

288,961

 

 

 

 

Total liabilities and shareholders' equity

$

3,088,329

 

 

 

 

 

$

3,013,114

 

 

 

 

 

$

2,956,942

 

 

 

 

Cost of funds

 

 

0.97

 

 

 

 

 

 

0.67

 

 

 

 

 

 

0.91

 

 

 

Net interest margin (6)

 

 

4.14

 

 

 

 

 

 

4.51

 

 

 

 

 

 

4.58

 

 

 

(1)

Calculated using daily averages.

(2)

Average loan balances include nonaccrual loans.

(3)

Yields on loans reflects tax-exempt interest and state tax credits received on low or zero percent interest loans made to construct low income housing of $667, $661, and $790, for the three months ended June 30, 2021, March 31, 2021, and June 30, 2020, respectively.

(4)

Yields on tax-exempt securities are shown on a tax-equivalent basis.

(5)

Net interest spread is calculated as the yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities.

(6)

Net interest margin is the result of net interest income calculated on a tax-equivalent basis divided by average interest earning assets for the period.
 

This information is preliminary and based on company data available at the time of presentation.

RELIANT BANCORP, INC.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES-UNAUDITED

(Dollar Amounts in Thousands, Except Per Share Amounts)

 

 

Three Months Ended

 

June 30, 2021

 

March 31, 2021

 

June 30, 2020

Adjusted net interest margin (1):

 

 

 

 

 

Net interest income

$

28,561

 

 

$

30,026

 

 

$

29,956

 

Add: tax equivalent interest income

 

1,021

 

 

 

1,019

 

 

 

1,161

 

Add: swap termination fees

 

2,859

 

 

 

 

 

 

 

Less: purchase accounting adjustments

 

(1,839

)

 

 

(1,844

)

 

 

(5,232

)

Adjusted net interest income

 

30,602

 

 

 

29,201

 

 

 

25,885

 

Average Earning Assets

$

2,868,803

 

 

$

2,792,919

 

 

$

2,735,404

 

Net interest margin-tax equivalent

 

4.14

%

 

 

4.51

%

 

 

4.58

%

Adjusted net interest margin

 

4.28

%

 

 

4.24

%

 

 

3.81

%

 

 

 

 

 

 

Adjusted net income (2):

 

 

 

 

 

Net income (loss) attributable to common shareholders

$

13,045

 

 

$

12,149

 

 

$

7,868

 

Add: merger related expenses

 

 

 

 

 

 

 

2,632

 

Less: income tax impact of merger related expenses

 

 

 

 

 

 

 

(565

)

Adjusted net income

$

13,045

 

 

$

12,149

 

 

$

9,935

 

 

 

 

 

 

 

Adjusted diluted earnings per share:

 

 

 

 

 

Adjusted net income

$

13,045

 

 

$

12,149

 

 

$

9,935

 

Weighted average shares - diluted

 

16,784,744

 

 

 

16,740,303

 

 

 

16,529,080

 

Diluted earnings (loss) per share

$

0.78

 

 

$

0.73

 

 

$

0.48

 

Adjusted diluted earnings per share

$

0.78

 

 

$

0.73

 

 

$

0.60

 

 

 

 

 

 

 

Adjusted annualized return on average assets:

 

 

 

 

 

Adjusted net income

$

13,045

 

 

$

12,149

 

 

$

9,935

 

Average assets

 

3,088,329

 

 

 

3,013,114

 

 

 

2,956,942

 

Annualized return on average assets

 

1.69

%

 

 

1.64

%

 

 

1.07

%

Adjusted annualized return on average assets

 

1.69

%

 

 

1.64

%

 

 

1.35

%

 

 

 

 

 

 

Adjusted annualized return on average equity:

 

 

 

 

 

Adjusted net income

$

13,045

 

 

$

12,149

 

 

$

9,935

 

Average total shareholders' equity

 

339,504

 

 

 

327,029

 

 

 

288,961

 

Annualized return on average equity

 

15.41

%

 

 

15.07

%

 

 

10.95

%

Adjusted annualized return on average equity

 

15.41

%

 

 

15.07

%

 

 

13.83

%

 

 

 

 

 

 

Adjusted annualized return on average tangible common equity:

 

 

 

 

 

Average total shareholders' equity

$

339,504

 

 

$

327,029

 

 

$

288,961

 

Less: average intangible assets

 

(65,088

)

 

 

(65,531

)

 

 

(63,594

)

Average tangible common equity

$

274,416

 

 

$

261,498

 

 

$

225,367

 

Adjusted net income

 

13,045

 

 

 

12,149

 

 

 

9,935

 

Annualized return on average tangible common equity

 

19.07

%

 

 

18.84

%

 

 

14.04

%

Adjusted annualized return on average tangible common equity

 

19.07

%

 

 

18.84

%

 

 

17.73

%

 

 

 

 

 

 

Adjusted pre-tax pre-provision income:

 

 

 

 

 

Income (loss) before provision for income taxes

$

16,387

 

 

$

15,699

 

 

$

9,114

 

Add: merger related expenses

 

 

 

 

 

 

 

2,632

 

Add: provision for loan losses

 

 

 

 

 

 

 

3,000

 

Adjusted pre-tax pre-provision income

$

16,387

 

 

$

15,699

 

 

$

14,746

 

 

 

 

 

 

 

Tangible common equity to tangible assets:

 

 

 

 

 

Tangible common equity:

 

 

 

 

 

Total shareholders' equity

$

346,289

 

 

$

331,699

 

 

$

295,543

 

Less: intangible assets

 

(64,830

)

 

 

(65,287

)

 

 

(63,351

)

Tangible common equity

$

281,459

 

 

$

266,412

 

 

$

232,192

 

Tangible assets:

 

 

 

 

 

Total assets

$

3,098,464

 

 

$

3,057,066

 

 

$

2,990,126

 

Less: intangible assets

 

(64,830

)

 

 

(65,287

)

 

 

(63,351

)

Tangible assets

$

3,033,634

 

 

$

2,991,779

 

 

$

2,926,775

 

Total shareholders' equity to total assets

 

11.18

%

 

 

10.85

%

 

 

9.88

%

Tangible common equity to tangible assets

 

9.28

%

 

 

8.90

%

 

 

7.93

%

 

 

 

 

 

 

Tangible book value per share:

 

 

 

 

 

Tangible common equity

$

281,459

 

 

$

266,412

 

 

$

232,192

 

Total shares of common stock outstanding

 

16,672,511

 

 

 

16,654,415

 

 

 

16,631,604

 

Book value per common share

$

20.77

 

 

$

19.92

 

 

$

17.77

 

Tangible book value per share

$

16.88

 

 

$

16.00

 

 

$

13.96

 

 

 

 

 

 

 

Allowance for loan losses plus unaccreted loan purchase discounts:

 

 

 

 

 

Allowance for loan losses

$

20,894

 

 

$

20,785

 

 

$

18,237

 

Unaccreted loan purchase discounts

 

12,980

 

 

 

14,833

 

 

 

21,939

 

Allowance for loan losses plus unaccreted loan purchase discounts:

$

33,874

 

 

$

35,618

 

 

$

40,176

 

Total loans

 

2,321,070

 

 

 

2,277,714

 

 

 

2,317,324

 

Allowance for loan losses plus unaccreted purchased loan discounts to total loans

 

1.46

%

 

 

1.56

%

 

 

1.73

%

Allowance for loan losses to total loans

 

0.90

%

 

 

0.91

%

 

 

0.79

%

 

 

 

 

 

 

Bank segment adjusted net income:

 

 

 

 

 

Bank segment net income (loss)

$

13,045

 

 

$

12,149

 

 

$

7,868

 

Add: merger related expenses

 

 

 

 

 

 

 

2,632

 

Less: income tax impact of merger related expenses

 

 

 

 

 

 

 

(565

)

Bank segment adjusted net income

$

13,045

 

 

$

12,149

 

 

$

9,935

 

 

 

 

 

 

 

Bank segment adjusted noninterest expense:

 

 

 

 

 

Bank segment noninterest expense

$

16,570

 

 

$

16,460

 

 

$

19,065

 

Add: merger related expenses

 

 

 

 

 

 

 

(2,632

)

Bank segment adjusted noninterest expense

$

16,570

 

 

$

16,460

 

 

$

16,433

 

 

 

 

 

 

 

Bank segment adjusted efficiency ratio:

 

 

 

 

 

Bank segment adjusted total revenues:

 

 

 

 

 

Bank segment net interest income

$

27,440

 

 

$

29,133

 

 

$

29,420

 

Add: Tax equivalent interest income

 

1,021

 

 

 

1,019

 

 

 

1,161

 

Add: Bank segment noninterest income

 

5,335

 

 

 

2,409

 

 

 

2,174

 

Less: Gains on sale of securities, OREO, premises and equipment (3)

 

(2,922

)

 

 

(146

)

 

 

(338

)

Add: Swap termination fee (3)

 

2,859

 

 

 

 

 

 

 

Bank segment adjusted total revenues

$

33,733

 

 

$

32,415

 

 

$

32,417

 

Bank segment efficiency ratio

 

50.6

%

 

 

52.2

%

 

 

60.3

%

Bank segment adjusted efficiency ratio

 

49.1

%

 

 

50.8

%

 

 

50.7

%

 

 

 

 

 

 

Adjusted cost of funds:

 

 

 

 

 

Adjusted interest expense:

 

 

 

 

 

Interest Expense

$

6,534

 

 

$

4,356

 

 

$

5,959

 

Less: Swap termination fees

 

(2,859

)

 

 

 

 

 

 

Adjusted interest expense

$

3,675

 

 

$

4,356

 

 

$

5,959

 

Average funds

 

2,711,181

 

 

 

2,645,008

 

 

 

2,627,565

 

Cost of funds

 

0.97

%

 

 

0.67

%

 

 

0.91

%

Adjusted cost of funds

 

0.54

%

 

 

0.67

%

 

 

0.91

%

 

 

 

 

 

 

Adjusted cost of interest-bearing liabilities:

 

 

 

 

 

Adjusted interest expense

$

3,675

 

$

4,356

 

$

5,959

 

Average interest-bearing liabilities

 

2,113,993

 

 

 

2,079,238

 

 

 

2,158,990

 

Cost of interest-bearing liabilities

 

1.24

%

 

 

0.85

%

 

 

1.11

%

Adjusted cost of interest-bearing liabilities

 

0.70

%

 

 

0.85

%

 

 

1.11

%

 

 

 

 

 

 

Adjusted cost of deposits:

 

 

 

 

 

Adjusted deposit expense:

 

 

 

 

 

Deposit expense

$

5,541

 

 

$

3,399

 

 

$

4,829

 

Less: Swap termination fees

 

(2,859

)

 

 

 

 

 

 

Adjusted deposit expense

$

2,682

 

 

$

3,399

 

 

$

4,829

 

Average deposits

 

2,617,853

 

 

 

2,566,949

 

 

 

2,429,818

 

Cost of deposits

 

0.83

%

 

 

0.51

%

 

 

0.79

%

Adjusted cost of deposits

 

0.41

%

 

 

0.51

%

 

 

0.79

%

 

 

 

 

 

 

(1)

Prior calculation of this measure removed tax credits related to certain tax-preference-qualified loans and tax-exempt securities. The Company views these credits as normal course of business and as such removal is unnecessary.

(2)

The swap termination fees included in the adjusted net interest income calculation in the second quarter of 2021 were done so in conjunction with securities sales thereby nullifying the effects on net income. Therefore, we have not adjusted for these transactions as adjusted net income.

(3)

Securities sold in the second quarter of 2021 were done in conjunction with the swap termination fees. Therefore, we have adjusted for both sides of this transaction.

 

This information is preliminary and based on company data available at the time of presentation.

 

Contacts

DeVan Ard, Jr., Chairman and CEO, Reliant Bancorp, Inc. (615.221.2087)

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