Byline Bancorp, Inc. (the “Company” or “Byline”) (NYSE: BY), the parent company of Byline Bank (the “Bank”), today reported net income of $9.1 million, or $0.24 per diluted share, for the second quarter of 2020, compared with net income of $3.0 million, or $0.07 per diluted share, for the first quarter of 2020, and net income of $13.2 million, or $0.34 per diluted share, for the second quarter of 2019.
Alberto J. Paracchini, President and Chief Executive Officer of Byline, commented, “We continued to operate in a challenging environment due to the ongoing COVID-19 pandemic. Notwithstanding, our team continued to execute well during the second quarter, which enabled us to deliver a solid financial performance while remaining committed to supporting our employees, customers, and communities. We actively participated in the Paycheck Protection Program, and we were able to help more than 3,600 small businesses access approximately $627 million in funding. Our participation in the PPP helped drive strong growth in both loans and deposits during the second quarter. We are also seeing improving demand for government guaranteed loans outside of the PPP, which resulted in a higher level of loan sales this quarter.
“While the pandemic continues, we remain cautious given the uncertainties currently present in the economic outlook. We have increased our reserves through our Allowance for Loan and Lease Losses, added to our capital position with the subordinated debt offering we completed during the quarter, and continue to maintain a high level of liquidity. We believe this approach positions us well to continue to manage through this environment,” said Mr. Paracchini.
Byline’s Response to Pandemic Update
We continued to execute a series of measures implemented during the prior quarter to ensure the safety of employees, customers, and communities, to support customer needs, and to limit operational disruptions. Our Board of Directors and management teams continue to monitor and, when appropriate, make changes to our response. Recent updates include:
-
Maximized social distancing protocols by augmenting business hours and the locations of employee teams.
- 100% of our non-retail employees have the ability to work from home.
- Four hub branch locations open and allowing regular lobby traffic, drive-thru only locations for 18 branches, 17 full service branches with lobby hours by appointment, and 18 branches temporarily closed.
- Continuously following CDC guidelines at branches and offices.
-
Proactively engaged our customers and borrowers to identify short-term cash flow and other financial needs.
- Approved 1,800 payment deferrals totaling approximately $619.2 million, or 16.4%1 of loans and leases at June 30, 2020.
- Established customer strategy to process PPP loans efficiently through our existing SBA platform and funded over 3,600 loans totaling $626.8 million.
- Approved to participate in the Main Street Lending Facility through the Federal Reserve.
The following table presents information regarding the PPP loans as of June 30, 2020:
PPP Loan Size | ||||||||||||||||
Over $150,000 - | ||||||||||||||||
(dollars in thousands) | $0 - $150,000 | $2,000,000 | Over $2,000,000 | Total | ||||||||||||
Principal outstanding | $ | 119,736 | $ | 422,218 | $ | 84,639 | $ | 626,593 | ||||||||
Unearned processing fee | (5,335 | ) | (13,662 | ) | (730 | ) | (19,727 | ) | ||||||||
Deferred costs | 3,499 | 1,263 | 36 | 4,798 | ||||||||||||
Carrying value | $ | 117,900 | $ | 409,819 | $ | 83,945 | $ | 611,664 | ||||||||
Number of loans | 2,628 | 949 | 27 | 3,604 | ||||||||||||
STATEMENTS OF OPERATIONS
Net Interest Income
The following table presents net interest income for the periods indicated:
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
(dollars in thousands) | 2020 | 2020 | 2019 | 2019 | 2019 | 2020 | 2019 | |||||||||||||||||||||
INTEREST AND DIVIDEND INCOME | ||||||||||||||||||||||||||||
Interest and fees on loans and leases | $ | 50,153 | $ | 54,158 | $ | 58,203 | $ | 63,391 | $ | 59,524 | $ | 104,311 | $ | 113,907 | ||||||||||||||
Interest on securities | 7,530 | 8,016 | 7,212 | 7,040 | 6,665 | 15,546 | 12,767 | |||||||||||||||||||||
Other interest and dividend income | 222 | 992 | 500 | 598 | 571 | 1,214 | 1,196 | |||||||||||||||||||||
Total interest and dividend income | 57,905 | 63,166 | 65,915 | 71,029 | 66,760 | 121,071 | 127,870 | |||||||||||||||||||||
INTEREST EXPENSE | ||||||||||||||||||||||||||||
Deposits | 4,246 | 7,804 | 9,325 | 9,618 | 9,306 | 12,050 | 17,382 | |||||||||||||||||||||
Other borrowings | 476 | 1,897 | 1,989 | 2,835 | 2,265 | 2,373 | 4,431 | |||||||||||||||||||||
Subordinated notes and debentures | 574 | 640 | 687 | 738 | 741 | 1,214 | 1,524 | |||||||||||||||||||||
Total interest expense | 5,296 | 10,341 | 12,001 | 13,191 | 12,312 | 15,637 | 23,337 | |||||||||||||||||||||
Net interest income | $ | 52,609 | $ | 52,825 | $ | 53,914 | $ | 57,838 | $ | 54,448 | $ | 105,434 | $ | 104,533 | ||||||||||||||
The following table presents the average interest-earning assets and average interest-bearing liabilities for the periods indicated:
For the Three Months Ended | ||||||||||||||||||||||||
June 30, 2020 | March 31, 2020 | |||||||||||||||||||||||
(dollars in thousands) | Average
| Interest
| Average
| Average
| Interest
| Average
| ||||||||||||||||||
ASSETS | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 58,971 | $ | 25 | 0.17 | % | $ | 38,934 | $ | 157 | 1.63 | % | ||||||||||||
Loans and leases(1) | 4,283,654 | 50,153 | 4.71 | % | 3,799,213 | 54,158 | 5.73 | % | ||||||||||||||||
Taxable securities | 1,243,604 | 7,021 | 2.27 | % | 1,175,120 | 8,316 | 2.85 | % | ||||||||||||||||
Tax-exempt securities(2) | 117,340 | 706 | 2.42 | % | 84,679 | 535 | 2.54 | % | ||||||||||||||||
Total interest-earning assets | $ | 5,703,569 | $ | 57,905 | 4.08 | % | $ | 5,097,946 | $ | 63,166 | 4.98 | % | ||||||||||||
Allowance for loan and lease losses | (43,009 | ) | (33,664 | ) | ||||||||||||||||||||
All other assets | 526,414 | 501,670 | ||||||||||||||||||||||
TOTAL ASSETS | $ | 6,186,974 | $ | 5,565,952 | ||||||||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||
Deposits | ||||||||||||||||||||||||
Interest checking | $ | 392,070 | $ | 165 | 0.17 | % | $ | 338,905 | $ | 260 | 0.31 | % | ||||||||||||
Money market accounts | 1,214,713 | 946 | 0.31 | % | 962,205 | 2,214 | 0.93 | % | ||||||||||||||||
Savings | 511,049 | 61 | 0.05 | % | 480,270 | 61 | 0.05 | % | ||||||||||||||||
Time deposits | 976,710 | 3,074 | 1.27 | % | 1,113,596 | 5,269 | 1.90 | % | ||||||||||||||||
Total interest-bearing deposits | 3,094,542 | 4,246 | 0.55 | % | 2,894,976 | 7,804 | 1.08 | % | ||||||||||||||||
Other borrowings | 534,766 | 476 | 0.36 | % | 521,108 | 1,897 | 1.46 | % | ||||||||||||||||
Subordinated notes and debentures | 40,180 | 574 | 5.75 | % | 37,385 | 640 | 6.88 | % | ||||||||||||||||
Total borrowings | 574,946 | 1,050 | 0.73 | % | 558,493 | 2,537 | 1.83 | % | ||||||||||||||||
Total interest-bearing liabilities | $ | 3,669,488 | $ | 5,296 | 0.58 | % | $ | 3,453,469 | $ | 10,341 | 1.20 | % | ||||||||||||
Non-interest-bearing demand deposits | 1,692,723 | 1,298,800 | ||||||||||||||||||||||
Other liabilities | 48,884 | 48,256 | ||||||||||||||||||||||
Total stockholders’ equity | 775,879 | 765,427 | ||||||||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 6,186,974 | $ | 5,565,952 | ||||||||||||||||||||
Net interest spread(3) | 3.50 | % | 3.78 | % | ||||||||||||||||||||
Net interest income | $ | 52,609 | $ | 52,825 | ||||||||||||||||||||
Net interest margin(4) | 3.71 | % | 4.17 | % | ||||||||||||||||||||
Net loan accretion impact on margin | $ | 3,172 | 0.22 | % | $ | 3,671 | 0.29 | % | ||||||||||||||||
(1) | Loan and lease balances are net of deferred origination fees and costs and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances. | |
(2) | Interest income and rates exclude the effects of a tax equivalent adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality. | |
(3) | Represents the average rate earned on interest-earning assets minus the average rate paid on interest-bearing liabilities. | |
(4) | Represents net interest income (annualized) divided by total average earning assets. | |
(5) | Average balances are average daily balances. |
Net interest income for the second quarter of 2020 was $52.6 million, relatively the same level as the first quarter of 2020, as a lower cost of funds was offset by a decrease in loan yields.
The change in net interest income was primarily due to:
- A decrease of $3.6 million in interest expense on deposits, due to lower rates paid on money market accounts and maturities of higher-rate time deposits; and
- A decrease of $1.5 million in interest expense on borrowings principally as a result of accessing funds available to borrow at a lower cost.
Offset by:
- A decrease of $4.0 million in interest and fees on loans and leases, mainly due to a full quarter impact of the decreases in short-term rates in March 2020, the result of lower-yielding PPP loan balances, and a $499,000 decrease in accretion income on acquired loans.
Net interest margin for the second quarter of 2020 was 3.71%, a decrease of 46 basis points compared to 4.17% for the first quarter of 2020. Total net accretion income on acquired loans contributed 22 basis points to the net interest margin for the second quarter of 2020 compared to 29 basis points for the first quarter of 2020, a decrease of 7 basis points. The net interest margin decrease during the second quarter of 2020 was primarily driven by decreased loan and lease yields largely resulting from a full quarter impact of decreases in short-term rates and lower-yielding PPP loan balances partly offset by a decrease in the cost of funds also due to decreases in short-term rates and higher non-interest-bearing demand deposit balances.
The average cost of total deposits was 0.36% for the second quarter of 2020, a decrease of 39 basis points compared to the first quarter of 2020, mainly due to a lower average cost of money market accounts and time deposits as well as a favorable change in deposit mix. Average non-interest-bearing demand deposits grew by $393.9 million, while average time deposits decreased by $136.9 million. Average non-interest-bearing demand deposits were 35.4% of average total deposits for the second quarter of 2020 compared to 31.4% for the first quarter of 2020.
Provision for Loan and Lease Losses
The provision for loan and lease losses was $15.5 million for the second quarter of 2020, an increase of $1.1 million compared to $14.5 million for the first quarter of 2020. The second quarter included allocations of $14.2 million for originated loans and leases, $862,000 for acquired non-impaired loans, and $477,000 for acquired impaired loans. The provision during the second quarter of 2020 included $5.3 million in specific impairments on originated loans, including $1.4 million related to the unguaranteed portion of government guaranteed loans. The second quarter provision included $7.3 million to address the impact of the COVID-19 pandemic.
Non-interest Income
The following table presents the components of non-interest income for the periods indicated:
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
(dollars in thousands) | 2020 | 2020 | 2019 | 2019 | 2019 | 2020 | 2019 | |||||||||||||||||||||
NON-INTEREST INCOME | ||||||||||||||||||||||||||||
Fees and service charges on deposits | $ | 1,455 | $ | 1,673 | $ | 1,635 | $ | 1,612 | $ | 1,441 | $ | 3,128 | $ | 3,211 | ||||||||||||||
Loan servicing revenue | 2,980 | 2,758 | 2,834 | 2,692 | 2,630 | 5,738 | 5,169 | |||||||||||||||||||||
Loan servicing asset revaluation | (711 | ) | (3,064 | ) | (2,545 | ) | (1,610 | ) | (1,223 | ) | (3,775 | ) | (2,484 | ) | ||||||||||||||
ATM and interchange fees | 845 | 1,216 | 1,150 | 973 | 945 | 2,061 | 1,662 | |||||||||||||||||||||
Net gains on sales of securities available-for-sale | — | 1,375 | — | 178 | 973 | 1,375 | 973 | |||||||||||||||||||||
Change in fair value of equity securities, net | 766 | (619 | ) | 381 | (15 | ) | 551 | 147 | 1,050 | |||||||||||||||||||
Net gains on sales of loans | 6,456 | 4,773 | 8,735 | 9,405 | 7,472 | 11,229 | 13,705 | |||||||||||||||||||||
Wealth management and trust income | 608 | 669 | 704 | 653 | 626 | 1,277 | 1,221 | |||||||||||||||||||||
Other non-interest income | 389 | 392 | 1,622 | 918 | 768 | 781 | 1,664 | |||||||||||||||||||||
Total non-interest income | $ | 12,788 | $ | 9,173 | $ | 14,516 | $ | 14,806 | $ | 14,183 | $ | 21,961 | $ | 26,171 | ||||||||||||||
Non-interest income for the second quarter of 2020 was $12.8 million, an increase of $3.6 million, or 39.4% compared to $9.2 million for the first quarter of 2020.
The increase in total non-interest income was primarily due to:
- A $2.4 million decrease in loan servicing asset revaluation due to a favorable change in the fair value of the servicing asset as a result of improved secondary market conditions reflected by improved premium rates and lower pre-payment speeds following the initial onset of the COVID-19 pandemic;
- An increase of $1.7 million in net gains on sales of loans, mainly due to an increase in volume of sales of government guaranteed loans and improving premiums; and
- An increase in the change in fair value of equity securities, net, of $1.4 million due to an increase in the fair value of those securities.
Partially offset by:
- A decrease of $1.4 million in net gains on sales of securities available-for-sale as a result of sales during the first quarter of 2020 compared to none during the second quarter of 2020.
During the second quarter of 2020, the Company sold $78.7 million of U.S. government guaranteed loans compared to $61.0 million during the first quarter of 2020. The increase in sales was driven by increased SBA 7(a) origination volumes.
Non-interest Expense
The following table presents the components of non-interest expense for the periods indicated:
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
(dollars in thousands) | 2020 | 2020 | 2019 | 2019 | 2019 | 2020 | 2019 | |||||||||||||||||||||
NON-INTEREST EXPENSE | ||||||||||||||||||||||||||||
Salaries and employee benefits | $ | 19,405 | $ | 24,666 | $ | 24,228 | $ | 24,537 | $ | 23,652 | $ | 44,071 | $ | 46,544 | ||||||||||||||
Occupancy and equipment expense, net | 5,359 | 5,524 | 5,241 | 4,512 | 5,069 | 10,883 | 10,018 | |||||||||||||||||||||
Loan and lease related expenses | 1,260 | 1,311 | 2,648 | 1,949 | 1,841 | 2,571 | 3,418 | |||||||||||||||||||||
Legal, audit and other professional fees | 2,078 | 2,334 | 2,340 | 4,066 | 2,981 | 4,412 | 5,047 | |||||||||||||||||||||
Data processing | 2,826 | 2,665 | 2,678 | 4,062 | 3,849 | 5,491 | 6,993 | |||||||||||||||||||||
Net loss recognized on other real estate owned and other related expenses | 456 | 519 | 122 | 95 | 252 | 975 | 448 | |||||||||||||||||||||
Other intangible assets amortization expense | 1,892 | 1,893 | 2,002 | 2,003 | 1,959 | 3,785 | 3,732 | |||||||||||||||||||||
Other non-interest expense | 3,736 | 4,615 | 4,435 | 4,224 | 4,351 | 8,351 | 8,433 | |||||||||||||||||||||
Total non-interest expense | $ | 37,012 | $ | 43,527 | $ | 43,694 | $ | 45,448 | $ | 43,954 | $ | 80,539 | $ | 84,633 | ||||||||||||||
Non-interest expense for the second quarter of 2020 was $37.0 million, a decrease of $6.5 million, or 15.0%, from $43.5 million for the first quarter of 2020.
The decrease in total non-interest expense was primarily due to:
- A decrease of $5.3 million in salaries and employee benefits, mainly due to an increase in deferred costs as a result of PPP loan originations during the quarter; and
- A decrease of $879,000 in other non-interest expense mostly due to a decrease in impairment charges on assets held for sale.
The Company’s efficiency ratio was 53.70% for the second quarter of 2020 compared with 67.16% for the first quarter of 2020.
INCOME TAXES
The Company recorded income tax expense of $3.7 million during the second quarter of 2020, an effective tax rate of 29.0% compared to $1.1 million during the first quarter of 2020, an effective tax rate of 26.1%. The change in the effective tax rate was due to the reversal of tax benefits associated with share-based compensation awards.
STATEMENTS OF FINANCIAL CONDITION
Total assets were $6.4 billion at June 30, 2020, an increase of $658.8 million compared to $5.7 billion at March 31, 2020, and an increase of $1.0 billion compared to $5.4 billion at June 30, 2019.
The current quarter increase was primarily due to:
- An increase in securities of $128.2 million, principally a result of purchases of mortgage-backed securities during the quarter; and
- An increase in loans and leases of $530.9 million, mostly due to an increase of $610.9 million in our originated loan portfolio reflecting the growth in PPP and commercial real estate loan balances, partially offset by a decrease of $80.1 million in our acquired loan portfolios as a result of paydowns.
The following table shows our allocation of the originated, acquired impaired, and acquired non-impaired loans and leases at the dates indicated:
June 30, 2020 | March 31, 2020 | June 30, 2019 | ||||||||||||||||||||||
(dollars in thousands) | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||
Originated loans and leases | ||||||||||||||||||||||||
Commercial real estate | $ | 919,510 | 20.9 | % | $ | 839,244 | 21.7 | % | $ | 721,230 | 18.7 | % | ||||||||||||
Residential real estate | 480,692 | 10.9 | % | 480,946 | 12.5 | % | 501,038 | 13.0 | % | |||||||||||||||
Construction, land development, and other land | 219,261 | 5.0 | % | 242,001 | 6.3 | % | 196,656 | 5.1 | % | |||||||||||||||
Commercial and industrial | 1,200,996 | 27.4 | % | 1,263,688 | 32.7 | % | 992,313 | 25.7 | % | |||||||||||||||
Paycheck protection program | 611,664 | 13.9 | % | — | — | — | — | |||||||||||||||||
Installment and other | 2,714 | 0.1 | % | 4,594 | 0.1 | % | 10,937 | 0.3 | % | |||||||||||||||
Leasing financing receivables | 160,741 | 3.7 | % | 154,173 | 4.0 | % | 162,119 | 4.1 | % | |||||||||||||||
Total originated loans and leases | $ | 3,595,578 | 81.9 | % | $ | 2,984,646 | 77.3 | % | $ | 2,584,293 | 66.9 | % | ||||||||||||
Acquired impaired loans | ||||||||||||||||||||||||
Commercial real estate | $ | 126,405 | 2.9 | % | $ | 127,895 | 3.3 | % | $ | 151,127 | 3.9 | % | ||||||||||||
Residential real estate | 90,784 | 2.1 | % | 94,198 | 2.5 | % | 118,534 | 3.1 | % | |||||||||||||||
Construction, land development, and other land | 4,784 | 0.1 | % | 5,291 | 0.1 | % | 4,220 | 0.1 | % | |||||||||||||||
Commercial and industrial | 13,485 | 0.3 | % | 15,808 | 0.4 | % | 20,370 | 0.5 | % | |||||||||||||||
Installment and other | 226 | 0.0 | % | 236 | 0.0 | % | 300 | 0.0 | % | |||||||||||||||
Total acquired impaired loans | $ | 235,684 | 5.4 | % | $ | 243,428 | 6.3 | % | $ | 294,551 | 7.6 | % | ||||||||||||
Acquired non-impaired loans and leases | ||||||||||||||||||||||||
Commercial real estate | $ | 305,041 | 6.9 | % | $ | 327,820 | 8.5 | % | $ | 439,182 | 11.4 | % | ||||||||||||
Residential real estate | 99,288 | 2.2 | % | 118,853 | 3.1 | % | 158,190 | 4.1 | % | |||||||||||||||
Construction, land development, and other land | 21,958 | 0.5 | % | 30,484 | 0.8 | % | 51,072 | 1.3 | % | |||||||||||||||
Commercial and industrial | 116,668 | 2.7 | % | 135,063 | 3.5 | % | 307,887 | 8.0 | % | |||||||||||||||
Installment and other | 818 | 0.0 | % | 891 | 0.0 | % | 1,672 | 0.0 | % | |||||||||||||||
Leasing financing receivables | 16,087 | 0.4 | % | 19,074 | 0.5 | % | 26,301 | 0.7 | % | |||||||||||||||
Total acquired non-impaired loans and leases | $ | 559,860 | 12.7 | % | $ | 632,185 | 16.4 | % | $ | 984,304 | 25.5 | % | ||||||||||||
Total loans and leases | $ | 4,391,122 | 100.0 | % | $ | 3,860,259 | 100.0 | % | $ | 3,863,148 | 100.0 | % | ||||||||||||
Allowance for loan and lease losses | (51,300 | ) | (41,840 | ) | (31,132 | ) | ||||||||||||||||||
Total loans and leases, net of allowance for loan and lease losses | $ | 4,339,822 | $ | 3,818,419 | $ | 3,832,016 | ||||||||||||||||||
ASSET QUALITY
Non-Performing Assets
The following table sets forth the amounts of non-performing loans and leases (excluding acquired impaired), non-performing assets, and other real estate owned at the dates indicated:
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
(dollars in thousands) | 2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
Non-performing assets: | ||||||||||||||||||||
Non-accrual loans and leases | $ | 40,505 | $ | 48,964 | $ | 36,272 | $ | 39,528 | $ | 34,027 | ||||||||||
Past due loans and leases 90 days or more and still accruing interest | — | — | — | — | 996 | |||||||||||||||
Accruing troubled debt restructured loans | 3,151 | 1,725 | 1,771 | 2,204 | 1,529 | |||||||||||||||
Total non-performing loans and leases | 43,656 | 50,689 | 38,043 | 41,732 | 36,552 | |||||||||||||||
Other real estate owned | 8,652 | 9,273 | 9,896 | 6,502 | 6,531 | |||||||||||||||
Total non-performing assets | $ | 52,308 | $ | 59,962 | $ | 47,939 | $ | 48,234 | $ | 43,083 | ||||||||||
Total non-performing loans and leases as a percentage of total loans and leases | 0.99 | % | 1.31 | % | 1.00 | % | 1.09 | % | 0.95 | % | ||||||||||
Total non-performing assets as a percentage of total assets | 0.82 | % | 1.05 | % | 0.87 | % | 0.89 | % | 0.80 | % | ||||||||||
Allowance for loan and lease losses as a percentage of non-performing loans and leases | 117.51 | % | 82.54 | % | 83.95 | % | 75.68 | % | 85.17 | % | ||||||||||
Non-performing assets guaranteed by U.S. government: | ||||||||||||||||||||
Non-accrual loans guaranteed | $ | 3,755 | $ | 4,957 | $ | 4,232 | $ | 4,167 | $ | 4,723 | ||||||||||
Past due loans 90 days or more and still accruing interest guaranteed | — | — | — | — | — | |||||||||||||||
Accruing troubled debt restructured loans guaranteed | — | — | — | — | — | |||||||||||||||
Total non-performing loans guaranteed | $ | 3,755 | $ | 4,957 | $ | 4,232 | $ | 4,167 | $ | 4,723 | ||||||||||
Total non-performing loans and leases not guaranteed as a percentage of total loans and leases | 0.91 | % | 1.18 | % | 0.89 | % | 0.98 | % | 0.82 | % | ||||||||||
Total non-performing assets not guaranteed as a percentage of total assets | 0.76 | % | 0.96 | % | 0.79 | % | 0.81 | % | 0.71 | % | ||||||||||
Variances in non-performing assets were:
- Non-performing loans and leases were $43.7 million at June 30, 2020, a decrease of $7.0 million from $50.7 million at March 31, 2020, principally due to charge-offs; and
- Other real estate owned was $8.7 million at June 30, 2020, a decrease of $621,000 from $9.3 million at March 31, 2020 due to sales and valuation adjustments.
U.S. government guaranteed balances of non-performing loans were $3.8 million at June 30, 2020 and $5.0 million at March 31, 2020.
Allowance for Loan and Lease Losses
The following table presents the balance and activity within the allowance for loan and lease losses for the periods indicated:
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
(dollars in thousands) | 2020 | 2020 | 2019 | 2019 | 2019 | 2020 | 2019 | |||||||||||||||||||||
Allowance for loan and lease losses, beginning of period | $ | 41,840 | $ | 31,936 | $ | 31,585 | $ | 31,132 | $ | 27,106 | $ | 31,936 | $ | 25,201 | ||||||||||||||
Provision for loan and lease losses | 15,518 | 14,455 | 4,387 | 5,931 | 6,391 | 29,973 | 10,390 | |||||||||||||||||||||
Net charge-offs of loans and leases | (6,058 | ) | (4,551 | ) | (4,036 | ) | (5,478 | ) | (2,365 | ) | (10,609 | ) | (4,459 | ) | ||||||||||||||
Allowance for loan and lease losses, end of period | $ | 51,300 | $ | 41,840 | $ | 31,936 | $ | 31,585 | $ | 31,132 | $ | 51,300 | $ | 31,132 | ||||||||||||||
Allowance for loan and lease losses to period end total loans and leases held for investment | 1.17 | % | 1.08 | % | 0.84 | % | 0.82 | % | 0.81 | % | 1.17 | % | 0.81 | % | ||||||||||||||
Net charge-offs (annualized) to average loans and leases outstanding during the period | 0.57 | % | 0.48 | % | 0.42 | % | 0.56 | % | 0.25 | % | 0.53 | % | 0.25 | % | ||||||||||||||
Provision for loan and lease losses to net charge-offs during the period | 2.56x | 3.18x | 1.09x | 1.08x | 2.70x | 2.83 | x | 2.33x | ||||||||||||||||||||
The allowance for loan and lease losses as a percentage of total loans and leases held for investment increased to 1.17% at June 30, 2020 compared to 1.08% at March 31, 2020 and 0.81% at June 30, 2019.
In June 2016, the Financial Accounting Standards Board (“FASB”) issued new guidance on the recognition of credit losses which replaces the incurred loss impairment methodology with a methodology that reflects expected credit losses. In November 2019, the FASB delayed the effective date of the standard for smaller reporting companies, which includes emerging growth companies. Assuming the Company remains an emerging growth company, the standard is effective for fiscal years beginning after December 15, 2022. The Company is in the process of implementation and determining the impact that this new authoritative guidance will have on the Company’s consolidated financial statements.
Net Charge-Offs
Net charge-offs during the second quarter of 2020 were $6.1 million, or 0.57% of average loans and leases, on an annualized basis, an increase of $1.5 million compared to $4.6 million, or 0.48% of average loans and leases, during the first quarter of 2020, and an increase of $3.7 million from $2.4 million, or 0.25%, for the comparable quarter one year ago.
The net charge-offs during the quarter were primarily attributed to commercial and industrial loans. Net charge-offs for the second quarter of 2020 included $2.0 million in the unguaranteed portion of U.S. government guaranteed loans, while net charge-offs for the first quarter of 2020 included $3.4 million and second quarter of 2019 included $2.3 million in the unguaranteed portion of U.S. government guaranteed loans.
Deposits and Other Liabilities
The following table presents the composition of deposits at the dates indicated:
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
(dollars in thousands) | 2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
Non-interest-bearing demand deposits | $ | 1,768,675 | $ | 1,290,896 | $ | 1,279,641 | $ | 1,221,431 | $ | 1,240,375 | ||||||||||
Interest-bearing checking accounts | 503,909 | 355,678 | 338,185 | 372,049 | 345,081 | |||||||||||||||
Money market demand accounts | 1,233,748 | 1,104,276 | 881,387 | 745,154 | 728,954 | |||||||||||||||
Other savings | 525,043 | 486,131 | 475,839 | 471,878 | 480,756 | |||||||||||||||
Time deposits (below $250,000) | 710,429 | 800,759 | 916,723 | 966,866 | 980,162 | |||||||||||||||
Time deposits ($250,000 and above) | 216,541 | 201,096 | 255,802 | 302,936 | 284,915 | |||||||||||||||
Total deposits | $ | 4,958,345 | $ | 4,238,836 | $ | 4,147,577 | $ | 4,080,314 | $ | 4,060,243 | ||||||||||
Total deposits were $5.0 billion at June 30, 2020, an increase of $719.5 million compared to March 31, 2020, an increase of 17.0%. Non-interest-bearing deposits were 35.7% of total deposits at June 30, 2020 compared to 30.5% at March 31, 2020.
The increase in the current quarter was primarily due to:
- An increase in non-interest-bearing deposits of $477.8 million, from $1.3 billion at March 31, 2020 to $1.8 billion at June 30, 2020, mostly due to increases in business account balances;
- An increase in interest-bearing checking accounts of $148.2 million, from $355.7 million at March 31, 2020 to $503.9 million at June 30, 2020, mostly due to increases in personal and brokered account balances; and
- An increase in money market demand deposits of $129.5 million, from $1.1 billion at March 31, 2020 to $1.2 billion at June 30, 2020, largely driven by growth in business and brokered account balances.
Partially offset by:
- A decrease in time deposits of $74.9 million, from $1.0 billion at March 31, 2020 to $927.0 million at June 30, 2020, principally driven by decreases in personal certificates.
Total borrowings and other liabilities were $654.2 million at June 30, 2020, a decrease of $79.0 million from $733.3 million at March 31, 2020.
Stockholders’ Equity
Total stockholders’ equity was $780.9 million at June 30, 2020, an increase of $18.3 million from $762.7 million at March 31, 2020. The increase was due to the increase in accumulated other comprehensive income reflecting the unrealized gains in our available-for-sale securities portfolio in addition to net income generated during the quarter less dividends declared.
The following table presents the actual regulatory capital dollar amounts and ratios of the Company and Byline Bank as of June 30, 2020:
Actual | Minimum Capital
| Required to be
| ||||||||||||||||||||||
June 30, 2020 | Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||
Total capital to risk weighted assets: | ||||||||||||||||||||||||
Company | $ | 712,081 | 15.86 | % | $ | 359,161 | 8.00 | % | N/A | N/A | ||||||||||||||
Bank | 635,920 | 14.21 | % | 358,043 | 8.00 | % | $ | 447,554 | 10.00 | % | ||||||||||||||
Tier 1 capital to risk weighted assets: | ||||||||||||||||||||||||
Company | $ | 608,931 | 13.56 | % | $ | 269,371 | 6.00 | % | N/A | N/A | ||||||||||||||
Bank | 582,770 | 13.02 | % | 268,532 | 6.00 | % | $ | 358,043 | 8.00 | % | ||||||||||||||
Common Equity Tier 1 (CET1) to risk weighted assets: | ||||||||||||||||||||||||
Company | $ | 553,493 | 12.33 | % | $ | 202,028 | 4.50 | % | N/A | N/A | ||||||||||||||
Bank | 582,770 | 13.02 | % | 201,399 | 4.50 | % | $ | 290,910 | 6.50 | % | ||||||||||||||
Tier 1 capital to average assets: | ||||||||||||||||||||||||
Company | $ | 608,931 | 10.29 | % | $ | 236,702 | 4.00 | % | N/A | N/A | ||||||||||||||
Bank | 582,770 | 9.85 | % | 236,555 | 4.00 | % | $ | 295,694 | 5.00 | % | ||||||||||||||
Capital ratios for the period presented are based on the Basel III regulatory capital framework as applied to the Company’s current business and operations, and are subject to, among other things, completion and filing of the Company’s regulatory reports and ongoing regulatory review and implementation guidance.
On June 26, 2020, the Company completed a public offering of $50.0 million aggregate principal amount of 6.00% fixed-to-floating rate subordinated notes due July 1, 2030. The subordinated notes bear a fixed interest rate of 6.00% until July 1, 2025 and a floating interest rate equal to a benchmark rate, which is expected to be three-month term SOFR plus 588 basis points thereafter until maturity. The subordinated notes are intended to qualify as Tier 2 capital for regulatory capital purposes.
Conference Call, Webcast and Slide Presentation
The Company will host a conference call and webcast at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) on Friday, July 24, 2020 to discuss its quarterly financial results. Analysts and investors may participate in the question-and-answer session. The call can be accessed via telephone at (877) 512-8755. A recorded replay can be accessed through August 7, 2020 by dialing (877) 344-7529; passcode: 10146069.
A slide presentation relating to the second quarter 2020 results will be accessible prior to the scheduled conference call. The slide presentation and webcast of the conference call can be accessed on the News and Events page of the Company’s investor relations website at www.bylinebancorp.com.
About Byline Bancorp, Inc.
Headquartered in Chicago, Byline Bancorp, Inc. is the parent company for Byline Bank, a full service commercial bank serving small- and medium-sized businesses, financial sponsors, and consumers. Byline Bank has approximately $6.4 billion in assets and operates more than 50 full service branch locations throughout the Chicago and Milwaukee metropolitan areas. Byline Bank offers a broad range of commercial and retail banking products and services including small ticket equipment leasing solutions and is one of the top five Small Business Administration lenders in the United States.
Non-GAAP Financial Measures
This release contains certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). These measures include adjusted net income, adjusted diluted earnings per share, adjusted efficiency ratio, adjusted non-interest expense to average assets, non-interest income to total revenues, adjusted return on average stockholders’ equity, adjusted return on average assets, pre-tax pre-provision return on average assets, adjusted pre-tax pre-provision return on average assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common stockholders' equity, and adjusted return on average tangible common stockholders' equity. Management believes that these non-GAAP financial measures provide useful information to management and investors that is supplementary to the Company’s financial condition, results of operations and cash flows computed in accordance with GAAP; however, management acknowledges that our non-GAAP financial measures have a number of limitations. As such, these disclosures should not be viewed as a substitute for results determined in accordance with GAAP financial measures that we and other companies use. Management also uses these measures for peer comparison. See “Reconciliation of Non-GAAP Financial Measures” in the financial schedules included in this press release for a reconciliation of the non-GAAP financial measures to the comparable GAAP financial measures. Additionally, please refer to the Company’s Annual Report on Form 10-K for the detailed definitions of these non-GAAP financial measures.
Forward-Looking Statements
This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ‘‘may’’, ‘‘might’’, ‘‘should’’, ‘‘could’’, ‘‘predict’’, ‘‘potential’’, ‘‘believe’’, ‘‘expect’’, ‘‘continue’’, ‘‘will’’, ‘‘anticipate’’, ‘‘seek’’, ‘‘estimate’’, ‘‘intend’’, ‘‘plan’’, ‘‘projection’’, ‘‘would’’, ‘‘annualized’’, “target” and ‘‘outlook’’, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. Forward-looking statements involve estimates and known and unknown risks, and reflect various assumptions and involve elements of subjective judgement and analysis, which may or may not prove to be correct, and which are subject to uncertainties and contingencies outside the control of Byline and its respective affiliates, directors, employees and other representatives, which could cause actual results to differ materially from those presented in this communication.
The COVID-19 pandemic is adversely affecting us, our employees, customers, counterparties and third-party service providers, and the ultimate extent of the impacts on our business, financial position, results of operations, liquidity, and prospects is uncertain. Continued deterioration in general business and economic conditions, including further increases in unemployment rates, or turbulence in U.S. or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding, lead to a tightening of credit, and further increase stock price volatility. In addition, changes to statutes, regulations, or regulatory policies or practices as a result of, or in response to COVID-19, could affect us in substantial and unpredictable ways.
No representations, warranties or guarantees are or will be made by Byline as to the reliability, accuracy or completeness of any forward-looking statements contained in this communication or that such forward-looking statements are or will remain based on reasonable assumptions. You should not place undue reliance on any forward-looking statements contained in this communication.
Certain risks and important factors that could affect Byline’s future results are identified in its Annual Report on Form 10-K and other reports filed with the Securities and Exchange Commission, including among other things under the heading “Risk Factors” in its Annual Report on Form 10-K for the year ended December 31, 2019, and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2020. Any forward-looking statement speaks only as of the date on which it is made, and Byline undertakes no obligation to update any forward-looking statement, whether to reflect events or circumstances after the date on which the statement is made, to reflect new information or the occurrence of unanticipated events, or otherwise unless required under the federal securities laws.
BYLINE BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (unaudited) | ||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
(dollars in thousands) | 2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and due from banks | $ | 51,818 | $ | 45,233 | $ | 48,228 | $ | 75,275 | $ | 57,513 | ||||||||||
Interest bearing deposits with other banks | 88,113 | 74,386 | 32,509 | 33,564 | 31,802 | |||||||||||||||
Cash and cash equivalents | 139,931 | 119,619 | 80,737 | 108,839 | 89,315 | |||||||||||||||
Equity and other securities, at fair value | 8,181 | 7,413 | 8,031 | 7,648 | 7,662 | |||||||||||||||
Securities available-for-sale, at fair value | 1,426,871 | 1,299,483 | 1,186,292 | 1,031,933 | 969,029 | |||||||||||||||
Securities held-to-maturity, at amortized cost | 4,404 | 4,408 | 4,412 | 4,417 | 4,421 | |||||||||||||||
Restricted stock, at cost | 6,232 | 24,197 | 22,127 | 24,331 | 22,937 | |||||||||||||||
Loans held for sale | 3,031 | 13,299 | 11,732 | 7,176 | 18,473 | |||||||||||||||
Loans and leases: | ||||||||||||||||||||
Loans and leases | 4,391,122 | 3,860,259 | 3,785,661 | 3,831,090 | 3,863,148 | |||||||||||||||
Allowance for loan and lease losses | (51,300 | ) | (41,840 | ) | (31,936 | ) | (31,585 | ) | (31,132 | ) | ||||||||||
Net loans and leases | 4,339,822 | 3,818,419 | 3,753,725 | 3,799,505 | 3,832,016 | |||||||||||||||
Servicing assets, at fair value | 18,351 | 17,800 | 19,471 | 19,939 | 19,760 | |||||||||||||||
Premises and equipment, net | 95,546 | 96,446 | 96,140 | 96,006 | 96,588 | |||||||||||||||
Other real estate owned, net | 8,652 | 9,273 | 9,896 | 6,502 | 6,531 | |||||||||||||||
Goodwill and other intangible assets, net | 176,470 | 178,362 | 180,255 | 179,543 | 181,546 | |||||||||||||||
Bank-owned life insurance | 9,896 | 9,898 | 9,750 | 9,699 | 9,634 | |||||||||||||||
Deferred tax assets, net | 37,082 | 33,845 | 38,315 | 33,388 | 35,737 | |||||||||||||||
Accrued interest receivable and other assets | 119,049 | 102,292 | 100,926 | 109,352 | 97,587 | |||||||||||||||
Total assets | $ | 6,393,518 | $ | 5,734,754 | $ | 5,521,809 | $ | 5,438,278 | $ | 5,391,236 | ||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||
LIABILITIES | ||||||||||||||||||||
Non-interest-bearing demand deposits | $ | 1,768,675 | $ | 1,290,896 | $ | 1,279,641 | $ | 1,221,431 | $ | 1,240,375 | ||||||||||
Interest-bearing deposits | 3,189,670 | 2,947,940 | 2,867,936 | 2,858,883 | 2,819,868 | |||||||||||||||
Total deposits | 4,958,345 | 4,238,836 | 4,147,577 | 4,080,314 | 4,060,243 | |||||||||||||||
Other borrowings | 510,414 | 640,647 | 539,638 | 538,290 | 532,885 | |||||||||||||||
Subordinated notes, net | 48,777 | — | — | — | — | |||||||||||||||
Junior subordinated debentures issued to capital trusts, net | 36,206 | 37,462 | 37,334 | 37,207 | 37,059 | |||||||||||||||
Accrued expenses and other liabilities | 58,841 | 55,142 | 47,145 | 46,601 | 43,374 | |||||||||||||||
Total liabilities | 5,612,583 | 4,972,087 | 4,771,694 | 4,702,412 | 4,673,561 | |||||||||||||||
STOCKHOLDERS’ EQUITY | ||||||||||||||||||||
Preferred stock | 10,438 | 10,438 | 10,438 | 10,438 | 10,438 | |||||||||||||||
Common stock | 381 | 380 | 379 | 378 | 378 | |||||||||||||||
Additional paid-in capital | 583,307 | 582,517 | 580,965 | 579,564 | 578,828 | |||||||||||||||
Retained earnings | 168,444 | 160,652 | 159,033 | 144,525 | 129,379 | |||||||||||||||
Treasury stock | (1,668 | ) | (1,668 | ) | — | — | — | |||||||||||||
Accumulated other comprehensive income (loss), net of tax | 20,033 | 10,348 | (700 | ) | 961 | (1,348 | ) | |||||||||||||
Total stockholders’ equity | 780,935 | 762,667 | 750,115 | 735,866 | 717,675 | |||||||||||||||
Total liabilities and stockholders’ equity | $ | 6,393,518 | $ | 5,734,754 | $ | 5,521,809 | $ | 5,438,278 | $ | 5,391,236 | ||||||||||
BYLINE BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) | ||||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
(dollars in thousands, except per share data) | 2020 | 2020 | 2019 | 2019 | 2019 | 2020 | 2019 | |||||||||||||||||||||
INTEREST AND DIVIDEND INCOME | ||||||||||||||||||||||||||||
Interest and fees on loans and leases | $ | 50,153 | $ | 54,158 | $ | 58,203 | $ | 63,391 | $ | 59,524 | $ | 104,311 | $ | 113,907 | ||||||||||||||
Interest on securities | 7,530 | 8,016 | 7,212 | 7,040 | 6,665 | 15,546 | 12,767 | |||||||||||||||||||||
Other interest and dividend income | 222 | 992 | 500 | 598 | 571 | 1,214 | 1,196 | |||||||||||||||||||||
Total interest and dividend income | 57,905 | 63,166 | 65,915 | 71,029 | 66,760 | 121,071 | 127,870 | |||||||||||||||||||||
INTEREST EXPENSE | ||||||||||||||||||||||||||||
Deposits | 4,246 | 7,804 | 9,325 | 9,618 | 9,306 | 12,050 | 17,382 | |||||||||||||||||||||
Other borrowings | 476 | 1,897 | 1,989 | 2,835 | 2,265 | 2,373 | 4,431 | |||||||||||||||||||||
Subordinated notes and debentures | 574 | 640 | 687 | 738 | 741 | 1,214 | 1,524 | |||||||||||||||||||||
Total interest expense | 5,296 | 10,341 | 12,001 | 13,191 | 12,312 | 15,637 | 23,337 | |||||||||||||||||||||
Net interest income | 52,609 | 52,825 | 53,914 | 57,838 | 54,448 | 105,434 | 104,533 | |||||||||||||||||||||
PROVISION FOR LOAN AND LEASE LOSSES | 15,518 | 14,455 | 4,387 | 5,931 | 6,391 | 29,973 | 10,390 | |||||||||||||||||||||
Net interest income after provision for loan and lease losses | 37,091 | 38,370 | 49,527 | 51,907 | 48,057 | 75,461 | 94,143 | |||||||||||||||||||||
NON-INTEREST INCOME | ||||||||||||||||||||||||||||
Fees and service charges on deposits | 1,455 | 1,673 | 1,635 | 1,612 | 1,441 | 3,128 | 3,211 | |||||||||||||||||||||
Loan servicing revenue | 2,980 | 2,758 | 2,834 | 2,692 | 2,630 | 5,738 | 5,169 | |||||||||||||||||||||
Loan servicing asset revaluation | (711 | ) | (3,064 | ) | (2,545 | ) | (1,610 | ) | (1,223 | ) | (3,775 | ) | (2,484 | ) | ||||||||||||||
ATM and interchange fees | 845 | 1,216 | 1,150 | 973 | 945 | 2,061 | 1,662 | |||||||||||||||||||||
Net gains on sales of securities available-for-sale | — | 1,375 | — | 178 | 973 | 1,375 | 973 | |||||||||||||||||||||
Change in fair value of equity securities, net | 766 | (619 | ) | 381 | (15 | ) | 551 | 147 | 1,050 | |||||||||||||||||||
Net gains on sales of loans | 6,456 | 4,773 | 8,735 | 9,405 | 7,472 | 11,229 | 13,705 | |||||||||||||||||||||
Wealth management and trust income | 608 | 669 | 704 | 653 | 626 | 1,277 | 1,221 | |||||||||||||||||||||
Other non-interest income | 389 | 392 | 1,622 | 918 | 768 | 781 | 1,664 | |||||||||||||||||||||
Total non-interest income | 12,788 | 9,173 | 14,516 | 14,806 | 14,183 | 21,961 | 26,171 | |||||||||||||||||||||
NON-INTEREST EXPENSE | ||||||||||||||||||||||||||||
Salaries and employee benefits | 19,405 | 24,666 | 24,228 | 24,537 | 23,652 | 44,071 | 46,544 | |||||||||||||||||||||
Occupancy and equipment expense, net | 5,359 | 5,524 | 5,241 | 4,512 | 5,069 | 10,883 | 10,018 | |||||||||||||||||||||
Loan and lease related expenses | 1,260 | 1,311 | 2,648 | 1,949 | 1,841 | 2,571 | 3,418 | |||||||||||||||||||||
Legal, audit, and other professional fees | 2,078 | 2,334 | 2,340 | 4,066 | 2,981 | 4,412 | 5,047 | |||||||||||||||||||||
Data processing | 2,826 | 2,665 | 2,678 | 4,062 | 3,849 | 5,491 | 6,993 | |||||||||||||||||||||
Net loss recognized on other real estate owned and other related expenses | 456 | 519 | 122 | 95 | 252 | 975 | 448 | |||||||||||||||||||||
Other intangible assets amortization expense | 1,892 | 1,893 | 2,002 | 2,003 | 1,959 | 3,785 | 3,732 | |||||||||||||||||||||
Other non-interest expense | 3,736 | 4,615 | 4,435 | 4,224 | 4,351 | 8,351 | 8,433 | |||||||||||||||||||||
Total non-interest expense | 37,012 | 43,527 | 43,694 | 45,448 | 43,954 | 80,539 | 84,633 | |||||||||||||||||||||
INCOME BEFORE PROVISION FOR INCOME TAXES | 12,867 | 4,016 | 20,349 | 21,265 | 18,286 | 16,883 | 35,681 | |||||||||||||||||||||
PROVISION FOR INCOME TAXES | 3,728 | 1,050 | 4,497 | 5,923 | 5,075 | 4,778 | 9,873 | |||||||||||||||||||||
NET INCOME | 9,139 | 2,966 | 15,852 | 15,342 | 13,211 | 12,105 | 25,808 | |||||||||||||||||||||
Dividends on preferred shares | 195 | 196 | 196 | 196 | 195 | 391 | 391 | |||||||||||||||||||||
INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ | 8,944 | $ | 2,770 | $ | 15,656 | $ | 15,146 | $ | 13,016 | $ | 11,714 | $ | 25,417 | ||||||||||||||
EARNINGS PER COMMON SHARE | ||||||||||||||||||||||||||||
Basic | $ | 0.24 | $ | 0.07 | $ | 0.41 | $ | 0.40 | $ | 0.35 | $ | 0.31 | $ | 0.69 | ||||||||||||||
Diluted | $ | 0.24 | $ | 0.07 | $ | 0.41 | $ | 0.39 | $ | 0.34 | $ | 0.31 | $ | 0.68 | ||||||||||||||
BYLINE BANCORP, INC. AND SUBSIDIARIES SELECTED FINANCIAL DATA (unaudited) | ||||||||||||||||||||||||||||
As of or For the Three Months Ended | As of or For the Six Months
| |||||||||||||||||||||||||||
(dollars in thousands, except share and per share data) | June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | |||||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | 2020 | 2019 | ||||||||||||||||||||||
Common Share Data | ||||||||||||||||||||||||||||
Basic earnings per common share | $ | 0.24 | $ | 0.07 | $ | 0.41 | $ | 0.40 | $ | 0.35 | $ | 0.31 | $ | 0.69 | ||||||||||||||
Diluted earnings per common share | $ | 0.24 | $ | 0.07 | $ | 0.41 | $ | 0.39 | $ | 0.34 | $ | 0.31 | $ | 0.68 | ||||||||||||||
Adjusted diluted earnings per common share(2)(3)(4) | $ | 0.24 | $ | 0.09 | $ | 0.42 | $ | 0.41 | $ | 0.41 | $ | 0.32 | $ | 0.79 | ||||||||||||||
Weighted average common shares outstanding (basic) | 37,919,480 | 37,943,333 | 37,872,835 | 37,831,356 | 37,263,352 | 37,931,406 | 36,719,436 | |||||||||||||||||||||
Weighted average common shares outstanding (diluted) | 38,027,289 | 38,663,658 | 38,537,899 | 38,487,180 | 37,948,006 | 38,350,064 | 37,445,407 | |||||||||||||||||||||
Common shares outstanding | 38,388,217 | 38,383,021 | 38,256,500 | 38,169,126 | 38,115,219 | 38,388,217 | 38,115,219 | |||||||||||||||||||||
Cash dividends per common share | $ | 0.03 | $ | 0.03 | $ | 0.03 | N/A | N/A | $ | 0.06 | N/A | |||||||||||||||||
Dividend payout ratio on common stock | 12.50 | % | 42.86 | % | 7.32 | % | N/A | N/A | 19.35 | % | N/A | |||||||||||||||||
Tangible book value per common share(1) | $ | 15.47 | $ | 14.95 | $ | 14.62 | $ | 14.30 | $ | 13.79 | $ | 15.47 | $ | 13.79 | ||||||||||||||
Key Ratios and Performance Metrics (annualized where applicable) | ||||||||||||||||||||||||||||
Net interest margin | 3.71 | % | 4.17 | % | 4.32 | % | 4.62 | % | 4.51 | % | 3.93 | % | 4.47 | % | ||||||||||||||
Average cost of deposits | 0.36 | % | 0.75 | % | 0.88 | % | 0.94 | % | 0.92 | % | 0.54 | % | 0.90 | % | ||||||||||||||
Efficiency ratio(2) | 53.70 | % | 67.16 | % | 60.93 | % | 59.81 | % | 61.19 | % | 60.25 | % | 61.90 | % | ||||||||||||||
Adjusted efficiency ratio(1)(2)(3) | 53.70 | % | 66.00 | % | 60.51 | % | 58.17 | % | 56.02 | % | 59.69 | % | 57.70 | % | ||||||||||||||
Non-interest expense to average assets | 2.41 | % | 3.15 | % | 3.19 | % | 3.32 | % | 3.34 | % | 2.76 | % | 3.33 | % | ||||||||||||||
Adjusted non-interest expense to average assets(1)(3) | 2.41 | % | 3.09 | % | 3.17 | % | 3.23 | % | 3.07 | % | 2.73 | % | 3.12 | % | ||||||||||||||
Return on average stockholders' equity | 4.74 | % | 1.56 | % | 8.43 | % | 8.34 | % | 7.60 | % | 3.16 | % | 7.67 | % | ||||||||||||||
Adjusted return on average stockholders' equity(1)(3)(4) | 4.74 | % | 1.83 | % | 8.54 | % | 8.78 | % | 9.16 | % | 3.29 | % | 8.90 | % | ||||||||||||||
Return on average assets | 0.59 | % | 0.21 | % | 1.16 | % | 1.12 | % | 1.00 | % | 0.41 | % | 1.02 | % | ||||||||||||||
Adjusted return on average assets(1)(3)(4) | 0.59 | % | 0.25 | % | 1.17 | % | 1.18 | % | 1.21 | % | 0.43 | % | 1.18 | % | ||||||||||||||
Non-interest income to total revenues(1) | 19.56 | % | 14.79 | % | 21.21 | % | 20.38 | % | 20.67 | % | 17.24 | % | 20.02 | % | ||||||||||||||
Pre-tax pre-provision return on average assets(1) | 1.85 | % | 1.33 | % | 1.81 | % | 1.98 | % | 1.88 | % | 1.60 | % | 1.81 | % | ||||||||||||||
Adjusted pre-tax pre-provision return on average assets(1)(3) | 1.85 | % | 1.39 | % | 1.83 | % | 2.07 | % | 2.15 | % | 1.63 | % | 2.03 | % | ||||||||||||||
Return on average tangible common stockholders' equity(1) | 7.05 | % | 2.89 | % | 12.20 | % | 12.22 | % | 11.32 | % | 4.99 | % | 11.35 | % | ||||||||||||||
Adjusted return on average tangible common stockholders' equity(1)(3) | 7.05 | % | 3.25 | % | 12.35 | % | 12.82 | % | 13.44 | % | 5.17 | % | 13.00 | % | ||||||||||||||
Non-interest-bearing deposits to total deposits | 35.67 | % | 30.45 | % | 30.85 | % | 29.93 | % | 30.55 | % | 35.67 | % | 30.55 | % | ||||||||||||||
Loans and leases held for sale and loans and lease held for investment to total deposits | 88.62 | % | 91.38 | % | 91.56 | % | 94.07 | % | 95.60 | % | 88.62 | % | 95.60 | % | ||||||||||||||
Deposits to total liabilities | 88.34 | % | 85.25 | % | 86.92 | % | 86.77 | % | 86.88 | % | 88.34 | % | 86.88 | % | ||||||||||||||
Deposits per branch | $ | 86,989 | $ | 74,366 | $ | 67,993 | $ | 66,890 | $ | 66,561 | $ | 86,989 | $ | 66,561 | ||||||||||||||
Asset Quality Ratios | ||||||||||||||||||||||||||||
Non-performing loans and leases to total loans and leases held for investment, net before ALLL | 0.99 | % | 1.31 | % | 1.00 | % | 1.09 | % | 0.95 | % | 0.99 | % | 0.95 | % | ||||||||||||||
ALLL to total loans and leases held for investment, net before ALLL | 1.17 | % | 1.08 | % | 0.84 | % | 0.82 | % | 0.81 | % | 1.17 | % | 0.81 | % | ||||||||||||||
Net charge-offs to average total loans and leases held for investment, net before ALLL | 0.57 | % | 0.48 | % | 0.42 | % | 0.56 | % | 0.25 | % | 0.53 | % | 0.25 | % | ||||||||||||||
Acquisition accounting adjustments(4) | $ | 19,324 | $ | 25,889 | $ | 28,511 | $ | 31,053 | $ | 37,109 | $ | 19,324 | $ | 37,109 | ||||||||||||||
Capital Ratios | ||||||||||||||||||||||||||||
Common equity to total assets | 12.05 | % | 13.12 | % | 13.40 | % | 13.34 | % | 13.12 | % | 12.05 | % | 13.12 | % | ||||||||||||||
Tangible common equity to tangible assets(1) | 9.55 | % | 10.33 | % | 10.47 | % | 10.38 | % | 10.09 | % | 9.55 | % | 10.09 | % | ||||||||||||||
Leverage ratio | 10.29 | % | 11.18 | % | 11.39 | % | 11.14 | % | 11.09 | % | 10.29 | % | 11.09 | % | ||||||||||||||
Common equity tier 1 capital ratio | 12.33 | % | 12.24 | % | 12.36 | % | 12.12 | % | 11.65 | % | 12.33 | % | 11.65 | % | ||||||||||||||
Tier 1 capital ratio | 13.56 | % | 13.52 | % | 13.67 | % | 13.43 | % | 12.96 | % | 13.56 | % | 12.96 | % | ||||||||||||||
Total capital ratio | 15.86 | % | 14.50 | % | 14.43 | % | 14.19 | % | 13.71 | % | 15.86 | % | 13.71 | % | ||||||||||||||
(1) | Represents a non-GAAP financial measure. See “Reconciliation of non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure. | |
(2) | Represents non-interest expense less amortization of intangible assets divided by net interest income and non-interest income. | |
(3) | Calculation excludes impairment charges, merger-related expenses, and core systems conversion expense. | |
(4) | Represents the remaining net unaccreted discount as a result of applying the fair value adjustment at the time of the business combination on acquired loans. |
BYLINE BANCORP, INC. AND SUBSIDIARIES QUARTER-TO-DATE STATEMENT OF AVERAGE INTEREST-EARNING ASSETS AND AVERAGE INTEREST-BEARING LIABILITIES (unaudited) | ||||||||||||||||||||||||
For the Three Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | |||||||||||||||||||||||
(dollars in thousands) | Average
| Interest
| Average
| Average
| Interest
| Average
| ||||||||||||||||||
ASSETS | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 58,971 | $ | 25 | 0.17 | % | $ | 35,346 | $ | 245 | 2.78 | % | ||||||||||||
Loans and leases(1) | 4,283,654 | 50,153 | 4.71 | % | 3,759,634 | 59,524 | 6.35 | % | ||||||||||||||||
Taxable securities | 1,243,604 | 7,021 | 2.27 | % | 975,693 | 6,563 | 2.70 | % | ||||||||||||||||
Tax-exempt securities(2) | 117,340 | 706 | 2.42 | % | 68,314 | 428 | 2.52 | % | ||||||||||||||||
Total interest-earning assets | $ | 5,703,569 | $ | 57,905 | 4.08 | % | $ | 4,838,987 | $ | 66,760 | 5.53 | % | ||||||||||||
Allowance for loan and lease losses | (43,009 | ) | (28,203 | ) | ||||||||||||||||||||
All other assets | 526,414 | 464,036 | ||||||||||||||||||||||
TOTAL ASSETS | $ | 6,186,974 | $ | 5,274,820 | ||||||||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||
Deposits | ||||||||||||||||||||||||
Interest checking | $ | 392,070 | $ | 165 | 0.17 | % | $ | 333,725 | $ | 452 | 0.54 | % | ||||||||||||
Money market accounts | 1,214,713 | 946 | 0.31 | % | 695,986 | 1,790 | 1.03 | % | ||||||||||||||||
Savings | 511,049 | 61 | 0.05 | % | 477,775 | 118 | 0.10 | % | ||||||||||||||||
Time deposits | 976,710 | 3,074 | 1.27 | % | 1,278,488 | 6,946 | 2.18 | % | ||||||||||||||||
3,094,542 | 4,246 | 0.55 | % | 2,785,974 | 9,306 | 1.34 | % | |||||||||||||||||
Other borrowings | 534,766 | 476 | 0.36 | % | 462,841 | 2,265 | 1.96 | % | ||||||||||||||||
Subordinated notes and debentures | 40,180 | 574 | 5.75 | % | 36,963 | 741 | 8.04 | % | ||||||||||||||||
Total borrowings | 574,946 | 1,050 | 0.73 | % | 499,804 | 3,006 | 2.41 | % | ||||||||||||||||
Total interest-bearing liabilities | $ | 3,669,488 | $ | 5,296 | 0.58 | % | $ | 3,285,778 | $ | 12,312 | 1.50 | % | ||||||||||||
Non-interest-bearing demand deposits | 1,692,723 | 1,254,173 | ||||||||||||||||||||||
Other liabilities | 48,884 | 37,941 | ||||||||||||||||||||||
Total stockholders’ equity | 775,879 | 696,928 | ||||||||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 6,186,974 | $ | 5,274,820 | ||||||||||||||||||||
Net interest spread(3) | 3.50 | % | 4.03 | % | ||||||||||||||||||||
Net interest income | $ | 52,609 | $ | 54,448 | ||||||||||||||||||||
Net interest margin(4) | 3.71 | % | 4.51 | % | ||||||||||||||||||||
Net loan accretion impact on margin | $ | 3,172 | 0.22 | % | $ | 4,868 | 0.40 | % | ||||||||||||||||
(1) | Loan and lease balances are net of deferred origination fees and costs and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances. | |
(2) | Interest income and rates exclude the effects of a tax equivalent adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality. | |
(3) | Represents the average rate earned on interest-earning assets minus the average rate paid on interest-bearing liabilities. | |
(4) | Represents net interest income (annualized) divided by total average earning assets. | |
(5) | Average balances are average daily balances. |
BYLINE BANCORP, INC. AND SUBSIDIARIES YEAR-TO-DATE STATEMENT OF AVERAGE INTEREST-EARNING ASSETS AND AVERAGE INTEREST-BEARING LIABILITIES (unaudited) | ||||||||||||||||||||||||
For the Six Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | |||||||||||||||||||||||
(dollars in thousands) | Average
| Interest
| Average
| Average
| Interest
| Average
| ||||||||||||||||||
ASSETS | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 48,952 | $ | 182 | 0.75 | % | $ | 50,969 | $ | 546 | 2.16 | % | ||||||||||||
Loans and leases(1) | 4,041,433 | 104,311 | 5.19 | % | 3,647,427 | 113,907 | 6.30 | % | ||||||||||||||||
Taxable securities | 1,209,362 | 15,337 | 2.55 | % | 951,048 | 12,646 | 2.68 | % | ||||||||||||||||
Tax-exempt securities(2) | 101,010 | 1,241 | 2.47 | % | 61,792 | 771 | 2.52 | % | ||||||||||||||||
Total interest-earning assets | $ | 5,400,757 | $ | 121,071 | 4.51 | % | $ | 4,711,236 | $ | 127,870 | 5.47 | % | ||||||||||||
Allowance for loan and lease losses | (38,336 | ) | (26,786 | ) | ||||||||||||||||||||
All other assets | 514,042 | 435,672 | ||||||||||||||||||||||
TOTAL ASSETS | $ | 5,876,463 | $ | 5,120,122 | ||||||||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||
Deposits | ||||||||||||||||||||||||
Interest checking | $ | 365,487 | $ | 425 | 0.23 | % | $ | 313,499 | $ | 866 | 0.56 | % | ||||||||||||
Money market accounts | 1,088,459 | 3,160 | 0.58 | % | 654,723 | 3,249 | 1.00 | % | ||||||||||||||||
Savings | 495,660 | 122 | 0.05 | % | 474,509 | 257 | 0.11 | % | ||||||||||||||||
Time deposits | 1,045,153 | 8,343 | 1.61 | % | 1,237,182 | 13,010 | 2.12 | % | ||||||||||||||||
Total interest-bearing deposits | 2,994,759 | 12,050 | 0.81 | % | 2,679,913 | 17,382 | 1.31 | % | ||||||||||||||||
Other borrowings | 527,937 | 2,373 | 0.90 | % | 465,325 | 4,431 | 1.92 | % | ||||||||||||||||
Subordinated notes and debentures | 38,782 | 1,214 | 6.88 | % | 36,890 | 1,524 | 8.33 | % | ||||||||||||||||
Total borrowings | 566,719 | 3,587 | 1.27 | % | 502,215 | 5,955 | 2.39 | % | ||||||||||||||||
Total interest-bearing liabilities | $ | 3,561,478 | $ | 15,637 | 0.88 | % | $ | 3,182,128 | $ | 23,337 | 1.48 | % | ||||||||||||
Non-interest-bearing demand deposits | 1,495,761 | 1,220,266 | ||||||||||||||||||||||
Other liabilities | 48,571 | 39,582 | ||||||||||||||||||||||
Total stockholders’ equity | 770,653 | 678,146 | ||||||||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 5,876,463 | $ | 5,120,122 | ||||||||||||||||||||
Net interest spread(3) | 3.63 | % | 3.99 | % | ||||||||||||||||||||
Net interest income | $ | 105,434 | $ | 104,533 | ||||||||||||||||||||
Net interest margin(4) | 3.93 | % | 4.47 | % | ||||||||||||||||||||
Net loan accretion impact on margin | $ | 6,843 | 0.25 | % | $ | 10,069 | 0.43 | % | ||||||||||||||||
(1) | Loan and lease balances are net of deferred origination fees and costs and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances. |
(2) | Interest income and rates exclude the effects of a tax equivalent adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality. |
(3) | Represents the average rate earned on interest-earning assets minus the average rate paid on interest-bearing liabilities. |
(4) | Represents net interest income (annualized) divided by total average earning assets. |
(5) | Average balances are average daily balances. |
BYLINE BANCORP, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited) | ||||||||||||||||||||||||||||
As of or For the Three Months Ended | As of or For the Six Months
| |||||||||||||||||||||||||||
(dollars in thousands, except per share data) | June 30,
| March 31,
| December 31,
| September 30,
| June 30,
| June 30,
| June 30,
| |||||||||||||||||||||
Net income and earnings per share excluding significant items | ||||||||||||||||||||||||||||
Reported Net Income | $ | 9,139 | $ | 2,966 | $ | 15,852 | $ | 15,342 | $ | 13,211 | $ | 12,105 | $ | 25,808 | ||||||||||||||
Significant items: | ||||||||||||||||||||||||||||
Impairment charges on assets held for sale | — | 715 | 111 | 67 | — | 715 | 392 | |||||||||||||||||||||
Merger-related expense | — | — | 127 | 1,043 | 3,152 | — | 3,170 | |||||||||||||||||||||
Core system conversion expense | — | — | 48 | 77 | 394 | — | 1,924 | |||||||||||||||||||||
Tax benefit on impairment charges and merger-related expenses | — | (199 | ) | (79 | ) | (369 | ) | (842 | ) | (199 | ) | (1,382 | ) | |||||||||||||||
Adjusted Net Income | $ | 9,139 | $ | 3,482 | $ | 16,059 | $ | 16,160 | $ | 15,915 | $ | 12,621 | $ | 29,912 | ||||||||||||||
Reported Diluted Earnings per Share | $ | 0.24 | $ | 0.07 | $ | 0.41 | $ | 0.39 | $ | 0.34 | $ | 0.31 | $ | 0.68 | ||||||||||||||
Significant items: | ||||||||||||||||||||||||||||
Impairment charges on assets held for sale | — | 0.02 | — | — | — | 0.02 | 0.01 | |||||||||||||||||||||
Merger-related expense | — | — | 0.01 | 0.03 | 0.08 | — | 0.09 | |||||||||||||||||||||
Core system conversion expense | — | — | — | — | 0.01 | — | 0.05 | |||||||||||||||||||||
Tax benefit on impairment charges and merger-related expenses | — | — | — | (0.01 | ) | (0.02 | ) | (0.01 | ) | (0.04 | ) | |||||||||||||||||
Adjusted Diluted Earnings per Share | $ | 0.24 | $ | 0.09 | $ | 0.42 | $ | 0.41 | $ | 0.41 | $ | 0.32 | $ | 0.79 | ||||||||||||||
BYLINE BANCORP, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued) (unaudited) | ||||||||||||||||||||||||||||
As of or For the Three Months Ended | As of or For the Six Months
| |||||||||||||||||||||||||||
(dollars in thousands, except per share data, ratios annualized, where applicable) | June 30,
| March 31,
| December 31,
| September 30,
| June 30,
| June 30,
| June 30,
| |||||||||||||||||||||
Adjusted non-interest expense: | ||||||||||||||||||||||||||||
Non-interest expense | $ | 37,012 | $ | 43,527 | $ | 43,694 | $ | 45,448 | $ | 43,954 | $ | 80,539 | $ | 84,633 | ||||||||||||||
Less: Significant items | ||||||||||||||||||||||||||||
Impairment charges on assets held for sale | — | 715 | 111 | 67 | — | 715 | 392 | |||||||||||||||||||||
Merger-related expense | — | — | 127 | 1,043 | 3,152 | — | 3,170 | |||||||||||||||||||||
Core system conversion expense | — | — | 48 | 77 | 394 | — | 1,924 | |||||||||||||||||||||
Adjusted non-interest expense | $ | 37,012 | $ | 42,812 | $ | 43,408 | $ | 44,261 | $ | 40,408 | $ | 79,824 | $ | 79,147 | ||||||||||||||
Adjusted non-interest expense excluding amortization of intangible assets: | ||||||||||||||||||||||||||||
Adjusted non-interest expense | $ | 37,012 | $ | 42,812 | $ | 43,408 | $ | 44,261 | $ | 40,408 | $ | 79,824 | $ | 79,147 | ||||||||||||||
Less: Amortization of intangible assets | 1,892 | 1,893 | 2,002 | 2,003 | 1,959 | 3,785 | 3,732 | |||||||||||||||||||||
Adjusted non-interest expense excluding amortization of intangible assets | $ | 35,120 | $ | 40,919 | $ | 41,406 | $ | 42,258 | $ | 38,449 | $ | 76,039 | $ | 75,415 | ||||||||||||||
Pre-tax pre-provision net income: | ||||||||||||||||||||||||||||
Pre-tax income | $ | 12,867 | $ | 4,016 | $ | 20,349 | $ | 21,265 | $ | 18,286 | $ | 16,883 | $ | 35,681 | ||||||||||||||
Add: Provision for loan and lease losses | 15,518 | 14,455 | 4,387 | 5,931 | 6,391 | 29,973 | 10,390 | |||||||||||||||||||||
Pre-tax pre-provision net income | $ | 28,385 | $ | 18,471 | $ | 24,736 | $ | 27,196 | $ | 24,677 | $ | 46,856 | $ | 46,071 | ||||||||||||||
Adjusted pre-tax pre-provision net income: | ||||||||||||||||||||||||||||
Pre-tax pre-provision net income | $ | 28,385 | $ | 18,471 | $ | 24,736 | $ | 27,196 | $ | 24,677 | $ | 46,856 | $ | 46,071 | ||||||||||||||
Impairment charges on assets held for sale | — | 715 | 111 | 67 | — | 715 | 392 | |||||||||||||||||||||
Merger-related expense | — | — | 127 | 1,043 | 3,152 | — | 3,170 | |||||||||||||||||||||
Core system conversion expense | — | — | 48 | 77 | 394 | — | 1,924 | |||||||||||||||||||||
Adjusted pre-tax pre-provision net income | $ | 28,385 | $ | 19,186 | $ | 25,022 | $ | 28,383 | $ | 28,223 | $ | 47,571 | $ | 51,557 | ||||||||||||||
Total revenues: | ||||||||||||||||||||||||||||
Net interest income | $ | 52,609 | $ | 52,825 | $ | 53,914 | $ | 57,838 | $ | 54,448 | $ | 105,434 | $ | 104,533 | ||||||||||||||
Add: Non-interest income | 12,788 | 9,173 | 14,516 | 14,806 | 14,183 | 21,961 | 26,171 | |||||||||||||||||||||
Total revenues | $ | 65,397 | $ | 61,998 | $ | 68,430 | $ | 72,644 | $ | 68,631 | $ | 127,395 | $ | 130,704 | ||||||||||||||
Tangible common stockholders' equity: | ||||||||||||||||||||||||||||
Total stockholders' equity | $ | 780,935 | $ | 762,667 | $ | 750,115 | $ | 735,866 | $ | 717,675 | $ | 780,935 | $ | 717,675 | ||||||||||||||
Less: Preferred stock | 10,438 | 10,438 | 10,438 | 10,438 | 10,438 | 10,438 | 10,438 | |||||||||||||||||||||
Less: Goodwill and other intangibles | 176,470 | 178,362 | 180,255 | 179,543 | 181,546 | 176,470 | 181,546 | |||||||||||||||||||||
Tangible common stockholders' equity | $ | 594,027 | $ | 573,867 | $ | 559,422 | $ | 545,885 | $ | 525,691 | $ | 594,027 | $ | 525,691 | ||||||||||||||
Tangible assets: | ||||||||||||||||||||||||||||
Total assets | $ | 6,393,518 | $ | 5,734,754 | $ | 5,521,809 | $ | 5,438,278 | $ | 5,391,236 | $ | 6,393,518 | $ | 5,391,236 | ||||||||||||||
Less: Goodwill and other intangibles | 176,470 | 178,362 | 180,255 | 179,543 | 181,546 | 176,470 | 181,546 | |||||||||||||||||||||
Tangible assets | $ | 6,217,048 | $ | 5,556,392 | $ | 5,341,554 | $ | 5,258,735 | $ | 5,209,690 | $ | 6,217,048 | $ | 5,209,690 | ||||||||||||||
Average tangible common stockholders' equity: | ||||||||||||||||||||||||||||
Average total stockholders' equity | $ | 775,879 | $ | 765,427 | $ | 745,745 | $ | 729,781 | $ | 696,928 | $ | 770,653 | $ | 678,146 | ||||||||||||||
Less: Average preferred stock | 10,438 | 10,438 | 10,438 | 10,438 | 10,438 | 10,438 | 10,438 | |||||||||||||||||||||
Less: Average goodwill and other intangibles | 177,440 | 179,416 | 179,192 | 180,740 | 175,236 | 178,428 | 168,120 | |||||||||||||||||||||
Average tangible common stockholders' equity | $ | 588,001 | $ | 575,573 | $ | 556,115 | $ | 538,603 | $ | 511,254 | $ | 581,787 | $ | 499,588 | ||||||||||||||
Average tangible assets: | ||||||||||||||||||||||||||||
Average total assets | $ | 6,186,974 | $ | 5,565,952 | $ | 5,427,046 | $ | 5,435,762 | $ | 5,274,820 | $ | 5,876,463 | $ | 5,120,122 | ||||||||||||||
Less: Average goodwill and other intangibles | 177,440 | 179,416 | 179,192 | 180,740 | 175,236 | 178,428 | 168,120 | |||||||||||||||||||||
Average tangible assets | $ | 6,009,534 | $ | 5,386,536 | $ | 5,247,854 | $ | 5,255,022 | $ | 5,099,584 | $ | 5,698,035 | $ | 4,952,002 | ||||||||||||||
Tangible net income available to common stockholders: | ||||||||||||||||||||||||||||
Net income available to common stockholders | $ | 8,944 | $ | 2,770 | $ | 15,656 | $ | 15,146 | $ | 13,016 | $ | 11,714 | $ | 25,417 | ||||||||||||||
Add: After-tax intangible asset amortization | 1,365 | 1,366 | 1,445 | 1,445 | 1,413 | 2,731 | 2,692 | |||||||||||||||||||||
Tangible net income available to common stockholders | $ | 10,309 | $ | 4,136 | $ | 17,101 | $ | 16,591 | $ | 14,429 | $ | 14,445 | $ | 28,109 | ||||||||||||||
Adjusted tangible net income available to common stockholders: | ||||||||||||||||||||||||||||
Tangible net income available to common stockholders | $ | 10,309 | $ | 4,136 | $ | 17,101 | $ | 16,591 | $ | 14,429 | $ | 14,445 | $ | 28,109 | ||||||||||||||
Impairment charges on assets held for sale | — | 715 | 111 | 67 | — | 715 | 392 | |||||||||||||||||||||
Merger-related expense | — | — | 127 | 1,043 | 3,152 | — | 3,170 | |||||||||||||||||||||
Core system conversion expense | — | — | 48 | 77 | 394 | — | 1,924 | |||||||||||||||||||||
Tax benefit on significant items | — | (199 | ) | (79 | ) | (369 | ) | (842 | ) | (199 | ) | (1,382 | ) | |||||||||||||||
Adjusted tangible net income available to common stockholders | $ | 10,309 | $ | 4,652 | $ | 17,308 | $ | 17,409 | $ | 17,133 | $ | 14,961 | $ | 32,213 | ||||||||||||||
BYLINE BANCORP, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued) (unaudited) | ||||||||||||||||||||||||||||
As of or For the Three Months Ended | As of or For the Six Months
| |||||||||||||||||||||||||||
(dollars in thousands, except share and per share data, ratios annualized, where applicable) | June 30,
| March 31,
| December 31,
| September 30,
| June 30,
| June 30,
| June 30,
| |||||||||||||||||||||
Pre-tax pre-provision return on average assets: | ||||||||||||||||||||||||||||
Pre-tax pre-provision net income | $ | 28,385 | $ | 18,471 | $ | 24,736 | $ | 27,196 | $ | 24,677 | $ | 46,856 | $ | 46,071 | ||||||||||||||
Average total assets | 6,186,974 | 5,565,952 | 5,427,046 | 5,435,762 | 5,274,820 | 5,876,463 | 5,120,122 | |||||||||||||||||||||
Pre-tax pre-provision return on average assets | 1.85 | % | 1.33 | % | 1.81 | % | 1.98 | % | 1.88 | % | 1.60 | % | 1.81 | % | ||||||||||||||
Adjusted pre-tax pre-provision return on average assets: | ||||||||||||||||||||||||||||
Adjusted pre-tax pre-provision net income | $ | 28,385 | $ | 19,186 | $ | 25,022 | $ | 28,383 | $ | 28,223 | $ | 47,571 | $ | 51,557 | ||||||||||||||
Average total assets | 6,186,974 | 5,565,952 | 5,427,046 | 5,435,762 | 5,274,820 | 5,876,463 | 5,120,122 | |||||||||||||||||||||
Adjusted pre-tax pre-provision return on average assets | 1.85 | % | 1.39 | % | 1.83 | % | 2.07 | % | 2.15 | % | 1.63 | % | 2.03 | % | ||||||||||||||
Non-interest income to total revenues: | ||||||||||||||||||||||||||||
Non-interest income | $ | 12,788 | $ | 9,173 | $ | 14,516 | $ | 14,806 | $ | 14,183 | $ | 21,961 | $ | 26,171 | ||||||||||||||
Total revenues | 65,397 | 61,998 | 68,430 | 72,644 | 68,631 | 127,395 | 130,704 | |||||||||||||||||||||
Non-interest income to total revenues | 19.56 | % | 14.79 | % | 21.21 | % | 20.38 | % | 20.67 | % | 17.24 | % | 20.02 | % | ||||||||||||||
Adjusted non-interest expense to average assets: | ||||||||||||||||||||||||||||
Adjusted non-interest expense | $ | 37,012 | $ | 42,812 | $ | 43,408 | $ | 44,261 | $ | 40,408 | $ | 79,824 | $ | 79,147 | ||||||||||||||
Average total assets | 6,186,974 | 5,565,952 | 5,427,046 | 5,435,762 | 5,274,820 | 5,876,463 | 5,120,122 | |||||||||||||||||||||
Adjusted non-interest expense to average assets | 2.41 | % | 3.09 | % | 3.17 | % | 3.23 | % | 3.07 | % | 2.73 | % | 3.12 | % | ||||||||||||||
Adjusted efficiency ratio: | ||||||||||||||||||||||||||||
Adjusted non-interest expense excluding amortization of intangible assets | $ | 35,120 | $ | 40,919 | $ | 41,406 | $ | 42,258 | $ | 38,449 | $ | 76,039 | $ | 75,415 | ||||||||||||||
Total revenues | 65,397 | 61,998 | 68,430 | 72,644 | 68,631 | 127,395 | 130,704 | |||||||||||||||||||||
Adjusted efficiency ratio | 53.70 | % | 66.00 | % | 60.51 | % | 58.17 | % | 56.02 | % | 59.69 | % | 57.70 | % | ||||||||||||||
Adjusted return on average assets: | ||||||||||||||||||||||||||||
Adjusted net income | $ | 9,139 | $ | 3,482 | $ | 16,059 | $ | 16,160 | $ | 15,915 | $ | 12,621 | $ | 29,912 | ||||||||||||||
Average total assets | 6,186,974 | 5,565,952 | 5,427,046 | 5,435,762 | 5,274,820 | 5,876,463 | 5,120,122 | |||||||||||||||||||||
Adjusted return on average assets | 0.59 | % | 0.25 | % | 1.17 | % | 1.18 | % | 1.21 | % | 0.43 | % | 1.18 | % | ||||||||||||||
Adjusted return on average stockholders' equity: | ||||||||||||||||||||||||||||
Adjusted net income | $ | 9,139 | $ | 3,482 | $ | 16,059 | $ | 16,160 | $ | 15,915 | $ | 12,621 | $ | 29,912 | ||||||||||||||
Average stockholders' equity | 775,879 | 765,427 | 745,745 | 729,781 | 696,928 | 770,653 | 678,146 | |||||||||||||||||||||
Adjusted return on average stockholders' equity | 4.74 | % | 1.83 | % | 8.54 | % | 8.78 | % | 9.16 | % | 3.29 | % | 8.90 | % | ||||||||||||||
Tangible common equity to tangible assets: | ||||||||||||||||||||||||||||
Tangible common equity | $ | 594,027 | $ | 573,867 | $ | 559,422 | $ | 545,885 | $ | 525,691 | $ | 594,027 | $ | 525,691 | ||||||||||||||
Tangible assets | 6,217,048 | 5,556,392 | 5,341,554 | 5,258,735 | 5,209,690 | 6,217,048 | 5,209,690 | |||||||||||||||||||||
Tangible common equity to tangible assets | 9.55 | % | 10.33 | % | 10.47 | % | 10.38 | % | 10.09 | % | 9.55 | % | 10.09 | % | ||||||||||||||
Return on average tangible common stockholders' equity: | ||||||||||||||||||||||||||||
Tangible net income available to common stockholders | $ | 10,309 | $ | 4,136 | $ | 17,101 | $ | 16,591 | $ | 14,429 | $ | 14,445 | $ | 28,109 | ||||||||||||||
Average tangible common stockholders' equity | 588,001 | 575,573 | 556,115 | 538,603 | 511,254 | 581,787 | 499,588 | |||||||||||||||||||||
Return on average tangible common stockholders' equity | 7.05 | % | 2.89 | % | 12.20 | % | 12.22 | % | 11.32 | % | 4.99 | % | 11.35 | % | ||||||||||||||
Adjusted return on average tangible common stockholders' equity: | ||||||||||||||||||||||||||||
Adjusted tangible net income available to common stockholders | $ | 10,309 | $ | 4,652 | $ | 17,308 | $ | 17,409 | $ | 17,133 | $ | 14,961 | $ | 32,213 | ||||||||||||||
Average tangible common stockholders' equity | 588,001 | 575,573 | 556,115 | 538,603 | 511,254 | 581,787 | 499,588 | |||||||||||||||||||||
Adjusted return on average tangible common stockholders' equity | 7.05 | % | 3.25 | % | 12.35 | % | 12.82 | % | 13.44 | % | 5.17 | % | 13.00 | % | ||||||||||||||
Tangible book value per share: | ||||||||||||||||||||||||||||
Tangible common equity | $ | 594,027 | $ | 573,867 | $ | 559,422 | $ | 545,885 | $ | 525,691 | $ | 594,027 | $ | 525,691 | ||||||||||||||
Common shares outstanding | 38,388,217 | 38,383,021 | 38,256,500 | 38,169,126 | 38,115,219 | 38,388,217 | 38,115,219 | |||||||||||||||||||||
Tangible book value per share | $ | 15.47 | $ | 14.95 | $ | 14.62 | $ | 14.30 | $ | 13.79 | $ | 15.47 | $ | 13.79 | ||||||||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20200723005935/en/
Contacts:
Tony Rossi
Financial Profiles, Inc.
310-622-8221
BYIR@bylinebank.com
