GlobeNewswire Inc | Jan 25, 2021 04:01PM EST

January 25, 2021

BIRMINGHAM, Ala., Jan. 25, 2021 (GLOBE NEWSWIRE) -- ServisFirst Bancshares, Inc. (NASDAQ: SFBS), today announced earnings and operating results for the three months and year ended December 31, 2020.

Highlights:

-- Diluted earnings per share were $3.13 for 2020, a 13% increase over 2019 -- Diluted earnings per share for the quarter were $0.94, a 24% increase over the fourth quarter of 2019 -- Deposits grew from $7.53 billion to $9.98 billion year-over-year, or 32% -- Book value per share increased to $18.41, a 17% increase year-over-year -- Cash dividend increased from $0.175 to $0.20 cents per quarter, a 14% increase -- Opened new Venice, Florida office in January 2021

Tom Broughton, Chairman, President and CEO, said, We are thankful to have had the opportunity to assist so many of our clients during this pandemic and have worked to support them through a year of difficult circumstances. We are pleased that we were able to build new customer relationships during the pandemic; customers who came to ServisFirst Bank needing a responsive and dedicated banking partner. I am proud of our teams performance and dedication to our mission.

Bud Foshee, CFO, said, We are pleased to report record earnings in 2020. Given the uneven economic conditions and the unanticipated challenges that the pandemic presented, we maintained a strong commitment to hard work and to provide excellent service to our customers.

FINANCIAL SUMMARY (UNAUDITED)(in Thousands except share and per share amounts) % Change % Change From From Period Period Ending Ending Period Ending Period Ending September Period Ending December December 31, September 30, 30, December 31, 31, 2020 2020 2020 to 2019 2019 to Period Period Ending Ending December December 31, 31, 2020 2020QUARTERLY OPERATING RESULTSNet Income $ 50,981 $ 43,362 18 % $ 41,037 24 %Net Income Availableto Common $ 50,949 $ 43,362 17 % $ 41,005 24 %StockholdersDiluted Earnings Per $ 0.94 $ 0.80 18 % $ 0.76 24 %Share Return on Average 1.74 % 1.54 % 1.80 % AssetsReturn on AverageCommon Stockholders' 20.78 % 18.43 % 19.75 % EquityAverage Diluted 54,273,944 54,232,965 54,149,554 Shares Outstanding YEAR-TO-DATE OPERATING RESULTSNet Income $ 169,569 $ 149,243 14 %Net Income Availableto Common $ 169,506 $ 149,180 14 %StockholdersDiluted Earnings Per $ 3.13 $ 2.76 13 %ShareReturn on Average 1.59 % 1.73 % AssetsReturn on AverageCommon Stockholders' 18.55 % 19.15 % EquityAverage Diluted 54,219,037 54,103,074 Shares Outstanding BALANCE SHEET Total Assets $ 11,932,654 $ 11,394,874 5 % $ 8,947,653 33 %Loans 8,465,688 8,508,554 (1 ) % 7,261,451 17 %Non-interest-bearing 2,788,772 2,762,814 1 % 1,749,879 59 %Demand DepositsTotal Deposits 9,975,724 9,673,783 3 % 7,530,433 32 %Stockholders' Equity 992,852 949,589 5 % 842,682 18 %

DETAILED FINANCIALS

ServisFirst Bancshares, Inc. reported net income and net income available to common stockholders of $51.0 million and $50.9 million, respectively, for the quarter ended December 31, 2020, compared to net income and net income available to common stockholders of $41.0 million for the same quarter in 2019. Basic and diluted earnings per common share were $0.94 for the fourth quarter of 2020, compared to $0.77 and $0.76, respectively, for the fourth quarter of 2019.

Annualized return on average assets was 1.74% and annualized return on average common stockholders equity was 20.78% for the fourth quarter of 2020, compared to 1.80% and 19.75%, respectively, for the fourth quarter of 2019.

Net interest income was $92.1 million for the fourth quarter of 2020, compared to $85.1 million for the third quarter of 2020 and $75.8 million for the fourth quarter of 2019. The net interest margin in the fourth quarter of 2020 was 3.27% compared to 3.14% in the third quarter of 2020 and 3.47% in the fourth quarter of 2019. Accretion of net fees on PPP loans of $7.5 million during the fourth quarter of 2020 contributed to 35 basis points of loan yield increase, compared to $4.0 million of PPP loan fee accretion during the third quarter, or 19 basis points.

Average loans for the fourth quarter of 2020 were $8.46 billion, an increase of $99.5 million, or 5% annualized, over average loans of $8.37 billion for the third quarter of 2020, and an increase of $1.36 billion, or 19%, over average loans of $7.10 billion for the fourth quarter of 2019. We originated over 4,900 PPP loans during 2020 for a total of $1.05 billion. Excluding PPP loans, average loans for the fourth quarter of 2020 were $7.46 billion, an increase of $146.6 million compared to the third quarter of 2020, and an increase of $356.4 million, or 5%, over average loans for the fourth quarter of 2019.

Average total deposits for the fourth quarter of 2020 were $9.84 billion, an increase of $371.5 million, or 16% annualized, over average total deposits of $9.47 billion for the third quarter of 2020, and an increase of $2.16 billion, or 28%, over average total deposits of $7.68 billion for the fourth quarter of 2019.

Nonperforming assets to total assets were 0.21% for the fourth quarter of 2020, a decrease of eight basis points compared to 0.29% for the third quarter of 2020 and a decrease of 29 basis points compared to 0.50% for the fourth quarter of 2019. Annualized net charge-offs to average loans were 0.41%, a 13 basis-point decrease compared to 0.54% for the third quarter of 2020 and an increase of five basis points compared to 0.36% for the fourth quarter of 2019. The CARES Act, passed into law on March 27, 2020 as a result of the COVID-19 outbreak, allowed companies to delay their adoption of Accounting Standards Update (ASU) 2016-13, Measurement of Credit Losses on Financial Instruments (CECL), including the current expected credit loss methodology for estimating allowances for credit losses. We elected to delay adoption of ASU 2016-13 until the date on which the national emergency concerning the COVID-19 outbreak terminates or December 31, 2020, with an effective retrospective implementation date of January 1, 2020. Based on prevailing economic conditions and forecasts as of the January 1, 2020 adoption date, we recorded a net $2 million decrease in our allowance for credit losses for CECL adoption effective at January 1, 2020. This decrease is the result of implementing a more quantitative methodology along with the loan portfolio consisting primarily of commercial loans with generally short contractual maturities. The allowance for credit losses for the quarter ending December 31, 2020 was calculated under the CECL methodology and as a percentage of total loans was 1.04%. Other quarter-end periods presented for the allowance for loan losses were not restated for CECL adoption and were calculated under the incurred loss methodology. The allowance for loan losses as a percentage of total loans was 1.09% at September 30, 2020 and 1.05% at December 31, 2019. Excluding PPP loans, for all periods discussed, the allowance for credit losses as a percentage of total loans under the CECL methodology was 1.16% at December 31, 2020, compared to 1.24% and 1.05% at September 30, 2020 and December 31, 2019, respectively, under the incurred loss model. We recorded a $6.3 million provision for credit losses in the fourth quarter of 2020 compared to $12.3 million in the third quarter of 2020 and $5.9 million in the fourth quarter of 2019.

Noninterest income for the fourth quarter of 2020 increased $1.3 million, or 19%, to $8.2 million from $6.9 million in the fourth quarter of 2019. Deposit service charges increased $165,000, or 9%, to $2.0 million for the fourth quarter of 2020. Mortgage banking revenue increased $1.7 million, or 123%, from the fourth quarter of 2019 to the fourth quarter of 2020. Mortgage loan origination volumes increased approximately 94% during the fourth quarter of 2020 when compared to the same quarter in 2019. Credit card revenue, net of awards, decreased $978,000, or 52%, to $913,000 during the fourth quarter of 2020, compared to the fourth quarter of 2019. Credit card awards accruals were increased by $1.7 million during the fourth quarter of 2020 when compared to the fourth quarter of 2019. A majority of these accruals will be paid out to customers in January 2021. The amount of spend on purchase cards increased $29.1 million while the amount of spend on business credit cards increased $3.0 million during the fourth quarter of 2020 when compared to the fourth quarter of 2019. Purchase card spend carries lower profit margins than credit cards due to their higher rebates. Income on life insurance policies increased $241,000, or 17%, to $1.7 million during the fourth quarter of 2020, compared to $1.4 million during the fourth quarter of 2019. We purchased $40.0 million in BOLI contracts in July of 2020 and another $20.5 million in November of 2020. The November 2020 BOLI contracts include endorsement split dollar agreements entered into with certain of our executives, as well as policies with respect to certain of our other employees. Other income for the fourth quarter of 2020 increased $188,000, or 41%, to $643,000 from $455,000 in the fourth quarter of 2019. On May 4, 2020 we bought an interest rate cap with a term of three years and a notional amount of $300 million. The cap is tied to one-month LIBOR with a strike rate of 0.50%. We wrote down the value of the cap by $61,000 during the fourth quarter of 2020 and by $781,000 year-to-date through other income and are amortizing the fee paid to our counterparty over the life of the cap.

Noninterest expense for the fourth quarter of 2020 increased $2.7 million, or 10%, to $28.2 million from $25.5 million in the fourth quarter of 2019, and increased $1.6 million, or 6%, on a linked quarter basis. Salary and benefit expense for the fourth quarter of 2020 increased $1.3 million, or 9%, to $15.0 million from $13.7 million in the fourth quarter of 2019, and was flat on a linked quarter basis. The number of FTE employees was 493 as of December 31, 2020 compared to 486 as of September 30, 2020 and 500 as of December 31, 2019. Equipment and occupancy expense increased $341,000, or 15%, to $2.7 million in the fourth quarter of 2020, from $2.4 million in the fourth quarter of 2019. Third party processing expenses increased $242,000, or 8%, to $3.4 million in the fourth quarter of 2020, from $3.2 million in the fourth quarter of 2019. Professional services expense increased $85,000, or 7%, to $1.2 million in the fourth quarter of 2020. FDIC and other regulatory assessments increased $195,000, or 17%, to $1.4 million in the fourth quarter of 2020 compared to $1.2 million in the fourth quarter of 2019. Expenses associated with other real estate owned increased $37,000 to $140,000 in the fourth quarter of 2020, from $103,000 in the fourth quarter of 2019. Other operating expenses for the fourth quarter of 2020 increased $509,000, or 13%, to $4.4 million from $3.9 million in the fourth quarter of 2019, and increased $773,000, or 21%, on a linked-quarter basis. The efficiency ratio was 28.11% during the fourth quarter of 2020 compared to 30.83% during the fourth quarter of 2019 and compared to 28.50% during the third quarter of 2020.

Income tax expense increased $4.6 million, or 44%, to $14.9 million in the fourth quarter of 2020, compared to $10.3 million in the fourth quarter of 2019. Our effective tax rate was 22.56% for the fourth quarter of 2020 compared to 20.05% for the fourth quarter of 2019. State of Alabama tax credit investments matured at the end of 2019, causing our state credit amounts to decrease from $1.0 million during the fourth quarter of 2019 to $132,000 during the fourth quarter of 2020. We recognized a reduction in provision for income taxes resulting from excess tax benefits from the exercise and vesting of stock options and restricted stock during the fourth quarters of 2020 and 2019 of $170,000 and $297,000, respectively.

GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures

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 table provides 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.

December 31, September 30, June 30, March 31, December 31, 2020 2020 2020 2020 2019Book value per $ 18.41 $ 17.61 $ 16.98 $ 16.38 $ 15.71 share - GAAPTotal commonstockholders' 992,852 949,589 914,588 881,885 842,682 equity - GAAP Adjustments: Adjusted for goodwill and core deposit 13,908 13,976 14,043 14,111 14,179 intangible assetTangible commonstockholders' $ 978,944 $ 935,613 $ 900,545 $ 867,775 $ 828,503 equity -non-GAAPTangible bookvalue per share $ 18.15 $ 17.35 $ 16.72 $ 16.12 $ 15.45 - non-GAAP Stockholders'equity to total 8.32 % 8.33 % 8.31 % 9.42 % 9.42 %assets - GAAPTotal assets - $ 11,927,955 $ 11,394,874 $ 11,012,195 $ 9,364,882 $ 8,947,653 GAAP Adjustments: Adjusted for goodwill and core deposit 13,908 13,976 14,043 14,111 14,179 intangible assetTotal tangibleassets - $ 11,914,047 $ 11,380,898 $ 10,998,152 $ 9,350,771 $ 8,933,474 non-GAAPTangible commonequity to total 8.22 % 8.22 % 8.19 % 9.28 % 9.27 %tangible assets- non-GAAP

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, Sarasota 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 SECs 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, could, 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, but not limited to: the global health and economic crisis precipitated by the COVID-19 outbreak; 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; economic crisis and associated credit issues in industries most impacted by the COVID-19 outbreak, including but not limited to, the restaurant, hospitality and retail sectors; 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, in our Quarterly Reports on Form 10-Q for fiscal year 2020, 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 BankDavis Mange (205) 949-3420dmange@servisfirstbank.com

SELECTED FINANCIALHIGHLIGHTS (Unaudited)(In thousands exceptshare and per share data) 4th Quarter 2020 3rd Quarter 2020 2nd Quarter 2020 1st Quarter 2020 4th Quarter 2019CONSOLIDATED STATEMENT OF INCOMEInterest income $ 101,065 $ 96,110 $ 95,080 $ 96,767 $ 98,187 Interest expense 8,984 11,028 11,846 19,127 22,410 Net interest income 92,081 85,082 83,234 77,640 75,777 Provision for loan 6,283 12,284 10,283 13,584 5,884 lossesNet interest incomeafter provision for 85,798 72,798 72,951 64,056 69,893 loan lossesNon-interest income 8,237 8,172 7,033 6,674 6,936 Non-interest expense 28,202 26,573 28,816 27,920 25,503 Income before income 65,833 54,397 51,168 42,810 51,326 taxProvision for income 14,852 11,035 10,720 8,032 10,289 taxNet income 50,981 43,362 40,448 34,778 41,037 Preferred stock 32 - 31 - 32 dividendsNet income availableto common $ 50,949 $ 43,362 $ 40,417 $ 34,778 $ 41,005 stockholdersEarnings per share - $ 0.94 $ 0.80 $ 0.75 $ 0.65 $ 0.77 basicEarnings per share - $ 0.94 $ 0.80 $ 0.75 $ 0.64 $ 0.76 dilutedAverage diluted 54,273,944 54,232,965 54,194,506 54,167,414 54,149,554 shares outstanding CONSOLIDATED BALANCE SHEET DATATotal assets $ 11,932,654 $ 11,394,874 $ 11,012,195 $ 9,364,882 $ 8,947,653 Loans 8,465,688 8,508,544 8,315,375 7,568,836 7,261,451 Debt securities 886,938 913,299 856,378 827,032 759,649 Non-interest-bearing 2,788,772 2,762,814 2,678,893 1,925,626 1,749,879 demand depositsTotal deposits 9,975,724 9,673,783 9,342,918 7,832,655 7,530,433 Borrowings 64,748 64,719 64,715 64,707 64,703 Stockholders' equity $ 992,852 $ 949,589 $ 914,588 $ 881,885 $ 842,682 Shares outstanding 53,943,751 53,915,245 53,874,276 53,844,009 53,623,740 Book value per share $ 18.41 $ 17.61 $ 16.98 $ 16.38 $ 15.71 Tangible book value $ 18.15 $ 17.35 $ 16.72 $ 16.12 $ 15.45 per share (1) SELECTED FINANCIAL RATIOS (Annualized)Net interest margin 3.27 % 3.14 % 3.32 % 3.58 % 3.47 %Return on average 1.74 % 1.54 % 1.55 % 1.54 % 1.80 %assetsReturn on averagecommon stockholders' 20.78 % 18.43 % 18.40 % 16.23 % 19.75 %equityEfficiency ratio 28.11 % 28.50 % 31.92 % 33.11 % 30.83 %Non-interest expenseto average earning 1.00 % 0.98 % 1.15 % 1.29 % 1.17 %assets CAPITAL RATIOS (2) Common equity tier 1capital to 10.52 % 11.24 % 11.26 % 10.68 % 10.50 %risk-weighted assetsTier 1 capital to 10.52 % 11.25 % 11.27 % 10.68 % 10.50 %risk-weighted assetsTotal capital to 12.22 % 13.10 % 13.27 % 12.54 % 12.31 %risk-weighted assetsTier 1 capital to 8.23 % 8.22 % 8.46 % 9.56 % 9.13 %average assetsTangible commonequity to total 8.22 % 8.22 % 8.19 % 9.28 % 9.27 %tangible assets (1) (1) See "GAAP Reconciliation and Management Explanation of Non-GAAP FinancialMeasures" 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, December 31, % Change 2020 2019ASSETS Cash and due from banks $ 93,655 $ 78,618 19 %Interest-bearing balancesdue from depository 2,115,985 451,509 369 %institutionsFederal funds sold 1,771 100,473 (98 ) % Cash and cash 2,211,411 630,600 251 % equivalentsAvailable for sale debt 886,688 759,399 17 %securities, at fair valueHeld to maturity debtsecurities (fair value of 250 250 - %$250 at December 31, 2020and 2019)Mortgage loans held for 14,425 6,312 129 %saleLoans 8,465,688 7,261,451 17 %Less allowance for loan (87,942 ) (76,584 ) 15 %losses Loans, net 8,377,746 7,184,867 17 %Premises and equipment, net 54,969 56,496 (3 ) %Goodwill and otheridentifiable intangible 13,908 14,179 (2 ) %assetsOther assets 373,256 295,550 26 % Total assets $ 11,932,654 $ 8,947,653 33 %LIABILITIES AND STOCKHOLDERS' EQUITYLiabilities: Deposits: Non-interest-bearing $ 2,788,772 $ 1,749,879 59 % Interest-bearing 7,186,952 5,780,554 24 % Total deposits 9,975,724 7,530,433 32 %Federal funds purchased 851,545 470,749 81 %Other borrowings 64,748 64,703 - %Other liabilities 47,785 39,086 22 % Total liabilities 10,939,802 8,104,971 35 %Stockholders' equity: Preferred stock, par value $0.001 per share; 1,000,000 authorized and undesignated at December 31, 2020 and - - December 31, 2019 Common stock, par value $0.001 per share; 100,000,000 shares authorized; 53,943,751 shares issued and outstanding at December 31, 2020, and 53,623,740 shares issued and outstanding at December 31, 2019 54 54 - % Additional paid-in 223,856 219,766 2 % capital Retained earnings 748,224 616,611 21 % Accumulated other 20,218 5,749 252 % comprehensive income Total stockholders' equity attributable 992,352 842,180 18 % to ServisFirst Bancshares, Inc. Noncontrolling interest 500 502 - % Total stockholders' 992,852 842,682 18 % equity Total liabilities and $ 11,932,654 $ 8,947,653 33 % stockholders' equity

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)(In thousandsexcept per share data) Three Months Ended December Year Ended December 31, 31, 2020 2019 2020 2019Interest income: Interest and fees on $ 94,332 $ 89,407 $ 362,664 $ 354,308 loans Taxable 6,018 4,702 22,122 17,008 securities Nontaxable 129 274 739 1,429 securities Federal 5 1,053 332 6,038 funds sold Other interest and 581 2,751 3,165 12,020 dividends Total interest 101,065 98,187 389,022 390,803 incomeInterest expense: Deposits 7,853 19,786 45,230 90,958 Borrowed 1,131 2,624 5,755 12,200 funds Total interest 8,984 22,410 50,985 103,158 expense Net interest 92,081 75,777 338,037 287,645 incomeProvision for 6,283 5,884 42,434 22,638 loan losses Net interest income after provision 85,798 69,893 295,603 265,007 for loan lossesNon-interest income: Service charges on 1,971 1,806 7,528 7,029 deposit accounts Mortgage 3,050 1,366 8,747 4,361 banking Credit card 913 1,891 5,916 7,076 income Securities (losses) - (1 ) - 27 gains Increase in cash surrender 1,660 1,419 6,310 3,745 value life insurance Other operating 643 455 1,615 1,744 income Total non-interest 8,237 6,936 30,116 23,982 incomeNon-interest expense: Salaries and employee 14,970 13,680 61,414 57,783 benefits Equipment and 2,680 2,339 10,070 9,272 occupancy expense Third party processing 3,418 3,176 13,778 11,234 and other services Professional 1,248 1,163 4,242 4,235 services FDIC and other 1,366 1,171 4,354 2,975 regulatory assessments Other real estate owned 140 103 2,163 415 expense Other operating 4,380 3,871 15,490 16,214 expense Total non-interest 28,202 25,503 111,511 102,128 expense Income before 65,833 51,326 214,208 186,861 income taxProvision for 14,852 10,289 44,639 37,618 income tax Net income 50,981 41,037 169,569 149,243 Dividends on preferred 32 32 63 63 stock Net income available to $ 50,949 $ 41,005 $ 169,506 $ 149,180 common stockholdersBasic earningsper common $ 0.94 $ 0.77 $ 3.15 $ 2.79 shareDilutedearnings per $ 0.94 $ 0.76 $ 3.13 $ 2.76 common share

LOANS BY TYPE (UNAUDITED)(In thousands) 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 4th Quarter 2020 2020 2020 2020 2019Commercial,financial and $ 3,295,900 $ 3,466,189 $ 3,498,627 $ 2,771,307 $ 2,696,210 agriculturalReal estate - 593,614 530,919 544,586 548,578 521,392 constructionReal estate - mortgage: Owner-occupied 1,693,428 1,725,222 1,634,495 1,678,532 1,587,478 commercial 1-4 family 711,692 671,841 665,883 675,870 644,188 mortgage Other mortgage 2,106,184 2,056,549 1,911,384 1,834,137 1,747,394 Subtotal: Real 4,511,304 4,453,612 4,211,762 4,188,539 3,979,060 estate - mortgageConsumer 64,870 57,834 60,400 60,412 64,789 Total loans $ 8,465,688 $ 8,508,554 $ 8,315,375 $ 7,568,836 $ 7,261,451

SUMMARY OF LOAN LOSS EXPERIENCE (UNAUDITED)(Dollars in thousands) 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 4th Quarter 2020 2020 2020 2020 2019Allowance for loan losses:Beginning balance $ 92,440 $ 91,507 $ 85,414 $ 76,584 $ 77,192 Impact of Adoption of (2,000 ) - - - - ASC 326Loans charged off: Commercial financial and 8,792 11,146 1,358 2,640 4,742 agricultural Real estate - 202 - 376 454 - construction Real estate - - 200 2,520 1,678 1,689 mortgage Consumer 38 44 62 58 139 Total 9,032 11,390 4,316 4,830 6,570 charge offsRecoveries: Commercial financial and 94 12 84 62 51 agricultural Real estate - 30 - 1 1 1 construction Real estate - 114 12 13 1 2 mortgage Consumer 13 15 28 12 24 Total 251 39 126 76 78 recoveries Net 8,781 11,351 4,190 4,754 6,492 charge-offs Provision for 6,283 12,284 10,283 13,584 5,884 loan losses Ending balance $ 87,942 $ 92,440 $ 91,507 $ 85,414 $ 76,584 Allowance for credit losses 1.04 % - - - - to total loans Allowance for credit losses to total average loans 1.04 % - - - - Allowance for loan losses to - 1.09 % 1.10 % 1.13 % 1.05 % total loans Allowance for loan losses to total average loans - 1.11 % 1.10 % 1.16 % 1.08 % Net charge-offs to 0.41 % 0.54 % 0.20 % 0.26 % 0.36 % total average loans Provision for credit losses to total average loans 0.30 % - - - - Provision for loan losses to total average loans - 0.58 % 0.50 % 0.74 % 0.33 % Nonperforming assets: Nonaccrual $ 13,973 $ 21,675 $ 16,881 $ 28,914 $ 30,091 loans Loans 90+ days past 4,981 4,898 5,133 4,954 6,021 due and accruing Other real estate owned and repossessed 6,497 6,976 6,537 7,448 8,178 assets Total $ 25,451 $ 33,549 $ 28,551 $ 41,316 $ 44,290 Nonperforming loans to total 0.22 % 0.31 % 0.26 % 0.45 % 0.50 % loans Nonperforming assets to 0.21 % 0.29 % 0.26 % 0.44 % 0.50 % total assets Nonperforming assets to 0.22 % 0.30 % 0.26 % 0.45 % 0.50 % earning assets Allowance for credit losses 629.37 % - - - - to nonaccrual loans Allowance for loan losses to - 426.48 % 542.07 % 295.41 % 254.51 % nonaccrual loans Restructured $ 818 $ 1,800 $ 975 $ 975 $ 625 accruing loans Restructured accruing loans 0.01 % 0.02 % 0.01 % 0.01 % 0.01 % to total loans TROUBLED DEBT RESTRUCTURINGS (TDRs) (UNAUDITED) (In thousands) 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 4th Quarter 2020 2020 2020 2020 2019 Beginning $ 2,738 $ 1,568 $ 2,367 $ 3,330 $ 11,248 balance: Additions - 1,182 - 350 250 Net (paydowns) (619 ) (12 ) (12 ) (232 ) (3,481 ) / advances Charge-offs (535 ) - (412 ) (1,081 ) (1,333 ) Transfer to (151 ) - (375 ) - (3,354 ) OREO Ending balance $ 1,433 $ 2,738 $ 1,568 $ 2,367 $ 3,330

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (In thousands except per share data) 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 4th Quarter 2020 2020 2020 2020 2019Interest income: Interest and fees on $ 94,332 $ 89,564 $ 89,383 $ 89,385 $ 89,407 loans Taxable 6,018 5,858 5,092 5,154 4,702 securities Nontaxable 129 166 211 233 274 securities Federal 5 16 34 277 1,053 funds sold Other interest and 581 506 360 1,718 2,751 dividends Total interest 101,065 96,110 95,080 96,767 98,187 incomeInterest expense: Deposits 7,853 9,876 10,756 16,745 19,786 Borrowed 1,131 1,152 1,090 2,382 2,624 funds Total interest 8,984 11,028 11,846 19,127 22,410 expense Net interest 92,081 85,082 83,234 77,640 75,777 incomeProvision for 6,283 12,284 10,283 13,584 5,884 loan losses Net interest income after provision 85,798 72,798 72,951 64,056 69,893 for loan lossesNon-interest income: Service charges on 1,971 1,818 1,823 1,916 1,806 deposit accounts Mortgage 3,050 2,519 2,107 1,071 1,366 banking Credit card 913 1,840 1,398 1,765 1,891 income Securities - - - - (1 ) losses Increase in cash surrender 1,660 1,733 1,464 1,453 1,419 value life insurance Other operating 643 262 241 469 455 income Total non-interest 8,237 8,172 7,033 6,674 6,936 incomeNon-interest expense: Salaries and employee 14,970 14,994 15,792 15,658 13,680 benefits Equipment and 2,680 2,556 2,434 2,400 2,339 occupancy expense Third party processing 3,418 3,281 3,622 3,457 3,176 and other services Professional 1,248 955 1,091 948 1,163 services FDIC and other regulatory 1,366 1,061 595 1,332 1,171 assessments (credits) Other real estate owned 140 119 1,303 601 103 expense Other operating 4,380 3,607 3,979 3,524 3,871 expense Total non-interest 28,202 26,573 28,816 27,920 25,503 expense Income before 65,833 54,397 51,168 42,810 51,326 income taxProvision for 14,852 11,035 10,720 8,032 10,289 income tax Net income 50,981 43,362 40,448 34,778 41,037 Dividends on preferred 32 - 31 - 32 stock Net income available to $ 50,949 $ 43,362 $ 40,417 $ 34,778 $ 41,005 common stockholdersBasic earningsper common $ 0.94 $ 0.80 $ 0.75 $ 0.65 $ 0.77 shareDilutedearnings per $ 0.94 $ 0.80 $ 0.75 $ 0.64 $ 0.76 common share

AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS (UNAUDITED)ON A FULLY TAXABLE-EQUIVALENT BASIS(Dollars in thousands) 4th Quarter 2020 3rd Quarter 2020 2nd Quarter 2020 1st Quarter 2020 4th Quarter 2019 Average Yield / Average Yield / Average Yield / Average Yield / Average Yield / Balance Rate Balance Rate Balance Rate Balance Rate Balance RateAssets: Interest-earning assets: Loans, net of unearned income (1) Taxable $ 8,435,237 4.43 % $ 8,335,087 4.26 % $ 8,301,775 4.31 % $ 7,328,594 4.89 % $ 7,066,576 5.00 % Tax-exempt (2) 29,393 4.11 30,068 4.14 31,929 4.12 32,555 4.04 35,563 4.00 Total loans, net of unearned income 8,464,630 4.43 8,365,155 4.26 8,333,704 4.31 7,361,149 4.88 7,102,139 4.99 Mortgage loans held for sale 19,459 1.37 20,053 1.41 13,278 2.09 4,282 2.16 6,505 2.44 Debt securities: Taxable 862,333 2.79 820,526 2.86 761,575 2.67 750,413 2.75 670,732 2.81 Tax-exempt (2) 25,542 2.43 31,880 2.51 38,201 2.62 44,029 2.33 50,825 2.17 Total securities (3) 887,875 2.78 852,406 2.84 799,776 2.67 794,442 2.72 721,557 2.76 Federal funds sold 16,306 0.12 41,884 0.15 83,274 0.16 105,423 1.06 238,927 1.75 Interest-bearing balances 1,837,249 0.13 1,500,563 0.13 849,549 0.17 469,199 1.47 602,755 1.81 with banks Total interest-earning assets $ 11,225,519 3.58 % $ 10,780,061 3.55 % $ 10,079,581 3.80 % $ 8,734,495 4.46 % $ 8,671,883 4.49 %Non-interest-earning assets: Cash and due from banks 91,258 75,065 76,212 66,140 70,381 Net premises and equipment 56,315 56,799 57,446 58,066 57,986 Allowance for loan losses, accrued interest and other assets 308,251 281,196 248,702 241,479 233,885 Total assets $ 11,681,343 $ 11,193,121 $ 10,461,941 $ 9,100,180 $ 9,034,135 Interest-bearing liabilities: Interest-bearing deposits: Checking $ 1,197,908 0.23 % $ 1,077,595 0.31 % $ 992,848 0.35 % $ 956,803 0.57 % $ 961,258 0.69 % Savings 86,259 0.18 82,671 0.36 72,139 0.42 67,380 0.50 62,311 0.53 Money market 4,933,285 0.31 4,739,566 0.44 4,285,907 0.52 4,061,286 1.10 4,189,283 1.34 Time deposits 810,675 1.59 841,378 1.78 877,448 1.95 805,924 2.09 712,155 2.15 Total interest-bearing 7,028,127 0.44 6,741,210 0.58 6,228,342 0.69 5,891,393 1.14 5,925,007 1.32 deposits Federal funds purchased 752,765 0.22 682,971 0.22 572,990 0.22 492,638 1.31 420,066 1.74 Other borrowings 64,717 4.41 64,717 4.78 64,711 4.85 64,707 4.85 64,698 4.79 Total interest-bearing $ 7,845,609 0.46 % $ 7,488,898 0.59 % $ 6,866,043 0.69 % $ 6,448,738 1.19 % $ 6,409,771 1.39 % liabilitiesNon-interest-bearing liabilities: Non-interest-bearing checking 2,813,095 2,728,513 2,646,030 1,749,671 1,759,671 Other liabilities 47,290 39,537 69,061 39,801 41,112 Stockholders' equity 956,847 917,626 862,500 853,800 818,320 Accumulated other comprehensive income 18,502 18,547 18,307 8,170 5,261 Total liabilities and stockholders' equity $ 11,681,343 $ 11,193,121 $ 10,461,941 $ 9,100,180 $ 9,034,135 Net interest spread 3.12 % 2.96 % 3.11 % 3.27 % 3.10 %Net interest margin 3.27 % 3.14 % 3.32 % 3.58 % 3.47 % (1) Average loans include loans on which the accrual of interest has been discontinued.(2) Interest income and yields are presented on a fully taxable equivalent basis using a tax rate of 21%.(3) Unrealized losses on available-for-sale debt securities are excluded from the yield calculation.