PR Newswire | Apr 15, 2021 04:20PM EDT

04/15 15:20 CDT

BancFirst Corporation Reports First Quarter Earnings OKLAHOMA CITY, April 15, 2021

OKLAHOMA CITY, April 15, 2021 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS:BANF) reported net income of $42.5 million, or $1.27 diluted earnings per share, for the first quarter of 2021 compared to net income of $22.6 million, or $0.68 diluted earnings per share, for the first quarter of 2020. For the first quarter of 2021, no provision for credit losses was recorded, compared to a provision for credit losses of $19.6 million for the first quarter of 2020.

BancFirst Corporation Executive Chairman David Rainbolt commented, "Clearly the worst case scenarios for credit losses resulting from the pandemic are off the table. The consequence is that large reserve balances from last year's provisions do not need to be augmented. Moreover, if the economy continues to progress, we will likely see reversal of those provisions to some degree over the balance of the year."

The Company's net interest income for the first quarter of 2021 increased to $77.2 million compared to $74.1 million for the first quarter of 2020. Net interest income increased for the first quarter of 2021 due to loan growth, PPP fee income of approximately $9.5 million and the decrease in interest rates paid on deposits. The net interest margin for the quarter was 3.36% compared to 3.82% a year ago. Noninterest income for the quarter totaled $39.9 million, compared to $35.1 million last year. The increase in noninterest income was due to a gain from the sale of the Company's Hugo, Oklahoma branch of $2.5 million, $2.4 million in rental income from a real estate property foreclosed on in the fourth quarter of 2020, and a $1.2 million increase in income from sales of mortgage loans, which were partially offset by a $1.3 million decrease in treasury management income. Noninterest expense for the quarter increased to $65.0 million compared to $61.4 million last year because of $1.4 million of expenses related to the aforementioned foreclosed property, and a $2.2 million gain on the sale of other real estate owned in the first quarter of 2020 that reduced noninterest expense. The Company's effective tax rate was 18.5% compared to 20.0% for the first quarter of 2020.

At March 31, 2021, the Company's total assets were $10.5 billion, an increase of $1.3 billion from December 31, 2020. Debt securities of $520.5 million were down $34.7 million from December 31, 2020. Loans totaled $6.4 billion, a decrease of $68.1 million from December 31, 2020 partially due to approximately $21 million of loans that were sold with the Company's Hugo, Oklahoma branch. Deposits totaled $9.4 billion, an increase of $1.3 billion from December 31, 2020. The increase in assets and deposits was primarily related to the Paycheck Protection Program (PPP) and other government stimulus payments. At March 31, 2021, the balance of the PPP loans was $713.7 million. The Company's total stockholders' equity was $1.1 billion, an increase of $26.8 million over December 31, 2020. Off-balance sheet sweep accounts were $2.2 billion at March 31, 2021 compared to $2.7 billion at December 31, 2020.

Nonaccrual loans represent 0.55% of total loans at March 31, 2021, down from 0.58% at year-end 2020. Net charge-offs for the quarter were 0.01% of average loans, compared to 0.02% of average loans for the first quarter of 2020. The allowance for credit losses to total loans was 1.42% at both March 31, 2021 and year-end 2020, and the allowance for credit losses to nonaccrual loans was 257.20% compared to 243.35% at year-end 2020.

On February 19, 2021, the Company entered into a purchase and assumption agreement with The First National Bank and Trust Company of Vinita, Oklahoma to purchase certain of its assets and assume its deposits and certain other obligations. The First National Bank and Trust Company of Vinita is a nationally chartered bank with banking locations in Vinita and Grove, Oklahoma. These banking locations would become branches of BancFirst. As of December 31, 2020, The First National Bank and Trust Company of Vinita had approximately $285 million in total assets, $209 million in loans, and $258 million in deposits. The purchase and assumption is expected to be completed during the second quarter of 2021 and is subject to regulatory approval.

BancFirst Corporation CEO David Harlow commented, "Government stimulus continued to inject liquidity into the economy and drive deposit totals materially higher. Absent PPP, overall loan demand continues to be soft. PPP fees generated from both round 1 and round 2 bolstered net interest income while both core non-interest income and core non-interest expense were essentially flat. With zero provision for the quarter compared to $19.6 million a year ago, a nominally strong quarter at $1.28 per share is the result."

BancFirst Corporation (the Company) is an Oklahoma based financial services holding company. The Company operates two subsidiary banks, BancFirst, an Oklahoma state-chartered bank with 106 banking locations serving 58 communities across Oklahoma, and Pegasus Bank, with 3 banking locations in Dallas, TX. More information can be found at www.bancfirst.bank.

The Company may make forward-looking statements within the meaning of Section 27A of the securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 with respect to earnings, credit quality, corporate objectives, interest rates and other financial and business matters. Forward-looking statements include estimates and give management's current expectations or forecasts of future events. The Company cautions readers that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, including economic conditions, the performance of financial markets and interest rates; legislative and regulatory actions and reforms; competition; as well as other factors, all of which change over time. Actual results may differ materially from forward-looking statements.

BancFirst Corporation

Summary Financial Information

(Dollars in thousands, except per share and share data - Unaudited)

2021 2020 2020 2020 2020

1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr

Condensed IncomeStatements:

Net interest income $ 77,206 $ 79,535 $ 75,852 $ 77,208 $ 74,073

Provision for - 4,992 18,740 19,333 19,583credit losses

Non-interestincome:

Trust revenue 3,102 2,976 3,131 3,368 3,655

Service charges on 19,100 19,796 19,078 16,760 18,804deposits

Securities 95 156 - (595) 50transactions

Income from sales of 2,010 1,852 1,873 1,561 781loans

Insurance 5,989 5,680 5,197 4,443 5,676commissions

Cash management 3,003 3,135 3,701 4,255 4,320

Other 6,636 1,825 1,595 2,290 1,859

Total noninterest 39,935 35,420 34,575 32,082 35,145income

Non-interestexpense:

Salaries and 39,577 40,750 41,995 42,226 39,756employee benefits

Occupancy expense, 4,348 4,533 4,503 3,839 3,546net

Depreciation 3,877 3,779 3,795 3,544 3,491

Amortization of 793 915 968 968 964intangible assets

Data processing 1,678 1,763 1,669 1,629 1,692services

Net expense fromother real estate 1,510 420 196 (12) (2,135)owned

Marketing and 1,879 1,671 1,485 1,485 2,355business promotion

Deposit insurance 876 857 723 365 136

Other 10,425 10,923 10,749 10,607 11,580

Total noninterest 64,963 65,611 66,083 64,651 61,385expense

Income before 52,178 44,352 25,604 25,306 28,250income taxes

Income tax expense 9,658 8,994 4,714 4,576 5,642

Net income $ 42,520 $ 35,358 $ 20,890 $ 20,730 $ 22,608

Per Common ShareData:

Net income-basic $ 1.30 $ 1.08 $ 0.64 $ 0.64 $ 0.69

Net income-diluted 1.27 1.06 0.63 0.63 0.68

Cash dividends 0.34 0.34 0.34 0.32 0.32declared

Common shares 32,771,013 32,719,852 32,679,191 32,662,691 32,646,691outstanding

Average commonshares outstanding -

Basic 32,756,852 32,690,296 32,668,789 32,651,262 32,679,587

Diluted 33,408,116 33,275,550 33,168,938 33,075,493 33,287,359

Performance Ratios:

Return on average 1.69 % 1.45 % 0.86 % 0.88 % 1.07 %assets

Return on average 15.90 13.25 7.89 7.99 8.87stockholders' equity

Net interest margin 3.36 3.54 3.40 3.54 3.82

Efficiency ratio 55.46 57.08 59.84 59.16 56.20

BancFirst Corporation

Summary Financial Information

(Dollars in thousands, except per share and share data - Unaudited)

2021 2020 2020 2020 2020

1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr

Balance Sheet Data:

Total assets $ 10,549,305 $ 9,212,357 $ 9,618,868 $ 9,612,453 $ 8,669,096

Interest-bearing 2,788,316 1,336,394 1,609,462 1,583,116 1,356,826 deposits with banks

Debt securities 520,543 555,196 596,941 608,031 591,987

Total loans 6,380,108 6,448,225 6,660,694 6,696,856 6,006,065

Allowance for credit (90,860) (91,366) (106,126) (89,500) (70,080) losses

Deposits 9,371,940 8,064,704 8,495,891 8,486,671 7,573,200

Stockholders' equity 1,094,671 1,067,885 1,043,752 1,034,199 1,023,380

Book value per 33.40 32.64 31.94 31.66 31.35 common share

Tangible book value per common share 28.27 27.47 26.74 26.43 26.09 (non-GAAP)(1)

Balance Sheet Ratios:

Average loans to 70.84 % 77.02 % 78.55 % 79.78 % 77.75 % deposits

Average earning assets to total 91.54 91.82 91.99 92.23 91.51 assets

Average stockholders' equity 10.64 10.91 10.90 10.96 12.02 to average assets

Asset Quality Data:

Past due loans $ 5,282 $ 4,802 $ 6,412 $ 5,382 $ 10,065

Nonaccrual loans (5) 35,326 37,545 82,385 49,477 45,181

Restructured loans 7,801 7,784 2,837 3,213 3,158

Total nonperforming and restructured 48,409 50,131 91,634 58,072 58,404 loans

Other real estate owned and 30,320 32,480 4,939 4,948 6,001 repossessed assets

Total nonperforming and restructured 78,729 82,611 96,573 63,020 64,405 assets

Nonaccrual loans to 0.55 % 0.58 % 1.24 % 0.74 % 0.75 % total loans

Nonaccrual loans to total Non-PPP loans 0.62 0.65 1.41 0.84 0.75 (non-GAAP)(3)

Nonperforming and restructured loans 0.76 0.78 1.38 0.87 0.97 to total loans

Nonperforming and restructured loans 0.85 0.86 1.57 0.99 0.97 to total Non-PPP loans (non-GAAP)(3)

Nonperforming and restructured assets 0.75 0.90 1.00 0.66 0.74 to total assets

Allowance for credit losses to total 1.42 1.42 1.59 1.34 1.17 loans

Allowance for credit losses to total 1.60 1.58 1.82 1.52 1.17 Non-PPP loans (non-GAAP)(3)

Allowance for credit losses to nonaccrual 257.20 243.35 128.82 180.89 155.11 loans

Allowance for credit losses to 187.69 182.26 115.81 154.12 119.99 nonperforming and restructured loans

Net charge-offs to 0.01 0.30 0.03 0.00 0.02 average loans

Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(2):

Stockholders' equity $ 1,094,671 $ 1,067,885 $ 1,043,752 $ 1,034,199 $ 1,023,380

Less goodwill 149,922 149,922 149,922 149,922 149,923

Less intangible 18,206 18,999 19,914 20,882 21,850 assets, net

Tangible stockholders' equity $ 926,543 $ 898,964 $ 873,916 $ 863,395 $ 851,607 (non-GAAP)

Common shares 32,771,013 32,719,852 32,679,191 32,662,691 32,646,691 outstanding

Tangible book value per common share $ 28.27 $ 27.47 $ 26.74 $ 26.43 $ 26.09 (non-GAAP)

(1) Refer to the "Reconciliation of Tangible Book Value per Common Share (non-GAAP)" Table.

(2) Tangible book value per common share is stockholders' equity less goodwill and intangible assets, net, divided by common shares outstanding. This amount is a non-GAAP financial measure but has been included as it is considered to be a critical metric with which to analyze and evaluate the financial condition and capital strength of the Company. This measure should not be considered a substitute for operating results determined in accordance with GAAP.

Reconciliation of Non-PPP loan ratios (non-GAAP)(4):

Total loans $ 6,380,108 $ 6,448,225 $ 6,660,694 $ 6,696,856 $ 6,006,065

Less PPP loans 713,714 652,693 831,703 825,093 -

Total Non-PPP loans $ 5,666,394 $ 5,795,532 $ 5,828,991 $ 5,871,763 $ 6,006,065 (non-GAAP)

Nonaccrual loans (5) 35,326 37,545 82,385 49,477 45,181

Nonaccrual loans to total Non-PPP loans 0.62 % 0.65 % 1.41 % 0.84 % 0.75 % (non-GAAP)

Total nonperforming and restructured 48,409 50,131 91,634 58,072 58,404 loans

Nonperforming and restructured loans 0.85 % 0.86 % 1.57 % 0.99 % 0.97 % to total Non-PPP loans (non-GAAP)

Allowance for credit (90,860) (91,366) (106,126) (89,500) (70,080) losses

Allowance for credit losses to total 1.60 % 1.58 % 1.82 % 1.52 % 1.17 % Non-PPP loans (non-GAAP)

(3) Refer to the "Reconciliation of Non-PPP loan ratios (non-GAAP)" Table.

(4) Nonaccrual loans to total Non-PPP loans is nonaccrual loans, divided by total loans less Paycheck Protection Program (PPP) loans. Nonperforming and restructured loans to total Non-PPP loans is nonperforming and restructured loans, divided by total loans less PPP loans. Allowance to total Non-PPP loans is allowance for credit losses, divided by total loans less PPP loans. These amounts are non-GAAP financial measures but have been included as they are considered critical metrics with which to analyze and evaluate the financial condition and capital strength of the Company. These measures should not be considered substitutes for operating results determined in accordance with GAAP.

(5) Government Agencies guarantee approximately $6.6 million of nonaccrual loans at March 31, 2021.

BancFirst Corporation

Consolidated Average Balance Sheets

And Interest Margin Analysis

Taxable Equivalent Basis

(Dollars in thousands - Unaudited)

Three Months Ended

March 31, 2021

Interest Average

Average Income/ Yield/

Balance Expense Rate

ASSETS

Earning assets:

Loans $ 6,400,845 $ 77,766 4.93 %

Securities - taxable 521,698 1,693 1.32

Securities - tax exempt 19,340 88 1.84

Interest bearing deposits with banks 2,387,000 595 0.10and FFS

Total earning assets 9,328,883 80,142 3.48

Nonearning assets:

Cash and due from banks 268,848

Interest receivable and other assets 683,868

Allowance for credit losses (90,551)

Total nonearning assets 862,165

Total assets $ 10,191,048

LIABILITIES AND STOCKHOLDERS' EQUITY

Interest bearing liabilities:

Transaction deposits $ 766,994 $ 149 0.08 %

Savings deposits 3,504,020 1,106 0.13

Time deposits 657,938 1,067 0.66

Short-term borrowings 2,928 1 0.19

Junior subordinated debentures 26,804 491 7.43

Total interest bearing liabilities 4,958,684 2,814 0.23

Interest free funds:

Noninterest bearing deposits 4,106,084

Interest payable and other liabilities 41,522

Stockholders' equity 1,084,758

Total interest free funds 5,232,364

Total liabilities and $ 10,191,048stockholders' equity

Net interest income $ 77,328

Net interest spread 3.25 %

Effect of interest free funds 0.11 %

Net interest margin 3.36 %

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SOURCE BancFirst