Independent Bank Group, Inc. (NASDAQ: IBTX) today announced net
income of $33.1 million, or $0.80 per diluted share, for the
quarter ended June 30, 2023, compared to net income $52.4 million,
or $1.25 per diluted share for the quarter ended June 30, 2022 and
to net loss of $37.5 million, or $0.91 per diluted share for the
quarter ended March 31, 2023. Adjusted net income for the quarter
ended June 30, 2023 was $33.7 million, or $0.82 per diluted share,
compared to $53.3 million, or $1.27 per diluted share for the
quarter ended June 30, 2022 and $44.1 million, or $1.07 per diluted
share for the quarter ended March 31, 2023.
The Company also announced that its Board of Directors declared
a quarterly cash dividend of $0.38 per share of common stock. The
dividend will be payable on August 17, 2023 to stockholders of
record as of the close of business on August 3, 2023.
Highlights
- Resilient credit quality with nonperforming assets of 0.32% of
total assets and net recoveries of 0.03% annualized for the
quarter
- Decreased loan to deposit ratio to 95.1% at quarter-end
compared to 99.8% at prior quarter-end
- Continued expense discipline with total adjusted (non-GAAP)
noninterest expense of $84.5 million for the quarter with total
reported noninterest expense of $85.7 million
- Strong liquidity, with cash and available for sale securities
representing approximately 13.6% of assets at June 30, 2023, and
with the ability to access considerable sources of contingent
liquidity
- Capital remains strong, with ratios well above the standards to
be considered well-capitalized under regulatory requirements, with
an estimated total capital ratio of 11.95%, leverage ratio of
8.92%, and (non-GAAP) tangible common equity (TCE) ratio of
7.37%
“During the second quarter, we were pleased to maintain a strong
foundation of resilient asset quality and a healthy balance sheet
supported by our talented relationship bankers operating across
Texas and Colorado. In addition, a rebound in retail mortgage
originations helped bolster fee income, while our continued focus
on expense discipline helped us reduce adjusted noninterest
expenses,” said Independent Bank Group Chairman & CEO David R.
Brooks. “Looking ahead, we are encouraged by the strength of our
loan and deposit production pipelines, which are supported by the
continued economic tailwinds in our four great markets. As we have
for over three decades, we will remain keenly focused on
disciplined execution, the pursuit of healthy growth, and
delivering exceptional service to our customers across Texas and
Colorado.”
Second Quarter 2023 Balance Sheet Highlights
Loans
- Total loans held for investment, net of mortgage warehouse
purchase loans, were $13.6 billion at June 30, 2023 and March 31,
2023 and $13.0 billion at June 30, 2022. PPP loans totaled $3.3
million, $3.5 million and $26.7 million as of June 30, 2023, March
31, 2023 and June 30, 2022, respectively. Loans held for investment
excluding PPP loans and mortgage warehouse loans increased $23.2
million, or 0.7% on an annualized basis, during second quarter
2023.
- Average mortgage warehouse purchase loans were $413.2 million
for the quarter ended June 30, 2023 compared to $298.0 million for
the quarter ended March 31, 2023, and $467.8 million for the
quarter ended June 30, 2022, an increase of $115.2 million, or
38.7% from the linked quarter and a decrease of $54.6 million, or
11.7% year over year. The change from the prior year is reflective
of decreased demand and lower volumes related to mortgage rate
increases for the year over year period while the linked quarter
change reflects an increase in volumes and improved margins.
Asset Quality
- Nonperforming assets totaled $60.5 million, or 0.32% of total
assets at June 30, 2023, compared to $60.1 million or 0.32% of
total assets at March 31, 2023, and $82.9 million, or 0.46% of
total assets at June 30, 2022.
- Nonperforming loans totaled $37.9 million, or 0.28% of total
loans held for investment at June 30, 2023, compared to $37.3
million, or 0.27% at March 31, 2023 and $69.9 million, or 0.54% at
June 30, 2022.
- The slight increase in nonperforming loans from the linked
quarter reflects an increase in loans 90 days past due and still
accruing primarily due to three residential real estate loans
totaling $1.5 million that are in process of collection or workout
offset by normal paydowns and principal reductions while the linked
quarter increase in nonperforming assets also reflects an $805
thousand branch facility which was closed and moved to other real
estate during the quarter offset by a $1.0 million writedown of
another real estate owned property.
- The decrease in nonperforming loans for the year over year
period primarily reflects the partial paydown and sale of a $9.3
million commercial nonaccrual loan and the payoff and partial
charge-off of a $10.7 million commercial nonaccrual loan, both
occurring in fourth quarter 2022, as well as the foreclosure of an
$11.7 million commercial real estate property. The change in
nonperforming assets from the prior year reflects a $1.2 million
charge-off as well as the writedown on the foreclosure discussed
above and a $1.2 million writedown on another other real estate
property, offset by the branch location discussed above that was
moved to other real estate owned during second quarter 2023.
- Net (recoveries) charge-offs were (0.03)% annualized in the
second quarter 2023 compared to 0.04% annualized in the linked
quarter and 0.09% annualized in the prior year quarter.
Deposits, Borrowings and Liquidity
- Total deposits were $14.9 billion at June 30, 2023 compared to
$14.1 billion at March 31, 2023 and compared to $15.1 billion at
June 30, 2022.
- Estimated uninsured deposits, excluding public funds deposits
totaled $4.6 billion, or 31.1% of total deposits as of June 30,
2023 compared to $5.3 billion, or 37.4% as of March 31, 2023.
- Total borrowings (other than junior subordinated debentures)
were $1.2 billion at June 30, 2023, a decrease of $957.3 million
from March 31, 2023 and an increase of $670.5 million from June 30,
2022. The year over year increase primarily reflects the use of
short-term FHLB advances to strategically increase the bank’s
liquidity position offset by the redemption of $30.0 million of
subordinated debentures. The linked quarter change reflects
reductions in FHLB advances of $925.0 million as well as a $32.5
million paydown on the Company's line of credit.
Capital
- The Company continues to be well capitalized under regulatory
guidelines. At June 30, 2023, the estimated common equity Tier 1 to
risk-weighted assets, Tier 1 capital to average assets, Tier 1
capital to risk-weighted assets and total capital to risk-weighted
asset ratios were 9.78%, 8.92%, 10.13% and 11.95%, respectively,
compared to 9.70%, 9.01%, 10.05%, and 11.88%, respectively, at
March 31, 2023 and 9.81%, 9.28%, 10.17%, and 12.24%, respectively
at June 30, 2022.
Second Quarter 2023 Operating Results
Net Interest Income
- Net interest income was $113.6 million for second quarter 2023
compared to $138.0 million for second quarter 2022 and $127.9
million for first quarter 2023. The decrease from the linked
quarter and prior year was primarily due to the increased funding
costs on our deposit products and FHLB advances due to Fed rate
increases over the last year offset to a lesser extent by increased
earnings on interest earning assets, primarily loans and
interest-bearing cash accounts. The prior year decrease also
reflects lower acquired loan accretion and PPP fees earned for the
year over year period. The second quarter 2023 includes $870
thousand in acquired loan accretion compared to $2.3 million in
second quarter 2022 and $1.0 million in first quarter 2023. In
addition, net PPP fees of $17 thousand were recognized in second
quarter 2023 compared to $837 thousand in second quarter 2022 and
$15 thousand in first quarter 2023. Total fees left to be
recognized were $69 thousand as of June 30, 2023.
- The average balance of total interest-earning assets grew by
$1.0 billion and totaled $16.8 billion for the quarter ended June
30, 2023 compared to $15.8 billion for the quarter ended June 30,
2022 and increased $425.8 million from $16.4 billion for the
quarter ended March 31, 2023. The increase from the prior year is
primarily due to higher average loans of $1.0 billion due to
organic growth for the year over year period but also due in part
to a $244.1 million increase in average interest-bearing cash
balances offset by a $247.0 million decrease in average taxable
securities balances. The slight increase from the linked quarter is
primarily due increased average interest-bearing cash balances and
to a lesser extent average loan balances.
- The yield on interest-earning assets was 5.14% for second
quarter 2023 compared to 3.83% for second quarter 2022 and 4.98%
for first quarter 2023. The increase in asset yield compared to the
linked quarter and prior year is primarily a result of increases in
the Fed Funds rate. The average loan yield, net of acquired loan
accretion and PPP income was 5.51% for the current quarter,
compared to 4.18% for prior year quarter and 5.33% for the linked
quarter.
- The cost of interest-bearing liabilities, including borrowings,
was 3.37% for second quarter 2023 compared to 0.50% for second
quarter 2022 and 2.63% for first quarter 2023. The increase from
the linked quarter and prior year is reflective of higher funding
costs, primarily on deposit products and FHLB advances as a result
of Fed Funds rate increases. In addition, deposit funding costs
were also higher due to promotional campaigns for certificate of
deposit accounts.
- The net interest margin was 2.71% for second quarter 2023
compared to 3.51% for second quarter 2022 and 3.17% for first
quarter 2023. The net interest margin excluding acquired loan
accretion was 2.69% for second quarter 2023 compared to 3.45%
second quarter 2022 and 3.14% for first quarter 2023. The decrease
in net interest margin from the prior year and linked quarter was
primarily due to the increased funding costs on deposits and
short-term advances resulting from continued Fed rate increases
over the year, offset to a lesser extent by higher earnings on
loans due to organic growth and rate increases and higher earnings
on interest-bearing cash balances due to rate increases for the
respective periods.
Noninterest Income
- Total noninterest income increased $218 thousand compared to
second quarter 2022 and increased $1.3 million compared to first
quarter 2023.
- The change from the prior year quarter reflects an increase of
$469 thousand in service charge income offset by decreases of $242
thousand in mortgage banking revenue, $196 thousand in mortgage
warehouse purchase fees and $359 thousand in other noninterest
income. In addition, a $367 thousand gain on sale of vacant land
was recognized during second quarter 2023.
- The change from the linked quarter primarily reflects the gain
on sale of land discussed above, as well as increases of $624
thousand in mortgage banking revenue and $211 thousand in mortgage
warehouse purchase fees due to increased volumes and improved
margins over the quarter.
Noninterest Expense
- Total noninterest expense decreased $220 thousand compared to
second quarter 2022 and $103.7 million compared to first quarter
2023. As previously disclosed in first quarter 2023, a
non-recurring litigation settlement expense of $102.5 million was
recognized related to an inherited receivership litigation.
- The net decrease in noninterest expense in second quarter 2023
compared to the prior year is due primarily to decreases of $4.2
million in salaries and benefits expense and $2.3 million in
professional fees offset by increases of $1.6 million in occupancy
expenses, $1.4 million in communications and technology expense and
$2.2 million in FDIC assessment. In addition, impairment expense of
$1.0 million was recorded in second quarter 2023 on an other real
estate property.
- Excluding the non-recurring expense discussed above, the
decrease in noninterest expense in second quarter 2023 compared to
the linked quarter is due primarily to decreases of $1.3 million in
professional fees and $1.9 million in other noninterest expense,
offset by a $1.1 million increase in FDIC assessment.
- The decrease in salaries and benefits from the prior year is
due primarily to $4.2 million in lower combined salaries, bonus and
employee insurance expenses due to the fourth quarter 2022
reduction-in-force and overall strategic efforts to reduce costs,
as well as lower contract labor costs of $1.1 million and lower
mortgage commissions and incentives of $484 thousand. Furthermore,
second quarter 2022 includes $1.1 million in severance and stock
grant amortization related to the separation of an executive
officer. In addition, deferred salaries expense, which reduces
overall expense, was $2.5 million lower compared to prior year
quarter due to lower loan origination activity.
- The increase in occupancy expenses from the prior year was
primarily due to higher depreciation and property tax expense due
to the opening of the second phase of the Company's headquarters
campus in second quarter 2022. The increase in communications and
technology expense from prior year was due to higher data
processing costs and software expense for the year over year
period.
- The increase in FDIC assessment compared to prior year and
linked quarter was due to increases in the assessment rate charged
by the FDIC which took effect in 2023, as well as an increase in
the liquidity stress rate.
- The decrease in professional fees compared to the prior year
and linked quarter was due primarily to lower consulting fees and
legal fees.
- The decrease in other noninterest expense compared to the
linked quarter is primarily due to decreases of $638 thousand in
loan-related costs, $649 thousand in impairment-related charges,
and decreases in various other miscellaneous expense accounts.
Provision for Credit Losses
- The Company recorded $220 thousand provision for credit losses
for second quarter 2023, compared to zero provision for second
quarter 2022 and $90 thousand provision for the linked quarter.
Provision expense during a given period is generally dependent on
changes in various factors, including economic conditions, credit
quality and past due trends, as well as loan growth and charge-offs
or specific credit loss allocations taken during the respective
period.
- The allowance for credit losses on loans was $147.8 million, or
1.08% of total loans held for investment, net of mortgage warehouse
purchase loans, at June 30, 2023, compared to $144.2 million, or
1.11% at June 30, 2022 and compared to $146.9 million, or 1.08% at
March 31, 2023.
- The allowance for credit losses on off-balance sheet exposures
was $4.9 million at June 30, 2023 compared to $4.7 million at June
30, 2022 compared to $4.8 million at March 31, 2023. Changes in the
allowance for unfunded commitments are generally driven by the
remaining unfunded amount and the expected utilization rate of a
given loan segment.
Income Taxes
- Federal income tax expense of $8.7 million was recorded for the
second quarter 2023, an effective rate of 20.8% compared to tax
expense of $13.6 million and an effective rate of 20.6% for the
prior year quarter and income tax benefit of $11.3 million and an
effective rate of 23.1% for the linked quarter. The higher
effective rate for the first quarter 2023 is due to the Company
being in a loss position as a result of the settlement of the
Stanford litigation.
Subsequent Events
The Company is required, under generally accepted accounting
principles, to evaluate subsequent events through the filing of its
consolidated financial statements for the quarter ended June 30,
2023 on Form 10-Q. As a result, the Company will continue to
evaluate the impact of any subsequent events on critical accounting
assumptions and estimates made as of June 30, 2023 and will adjust
amounts preliminarily reported, if necessary.
About Independent Bank Group, Inc.
Independent Bank Group, Inc. is a bank holding company
headquartered in McKinney, Texas. Through its wholly owned
subsidiary, Independent Bank, doing business as Independent
Financial, Independent Bank Group serves customers across Texas and
Colorado with a wide range of relationship-driven banking services
tailored to meet the needs of businesses, professionals and
individuals. Independent Bank Group, Inc. operates in four market
regions located in the Dallas/Fort Worth, Austin and Houston areas
in Texas and the Colorado Front Range area, including Denver,
Colorado Springs and Fort Collins.
Conference Call
A conference call covering Independent Bank Group’s second
quarter earnings announcement will be held on Tuesday, July 25,
2023 at 8:30 am (ET) and can be accessed by the webcast link,
https://www.webcast-eqs.com/independentbankgroup07252023_en/en or
by calling 1-877-407-0989 and by identifying the meeting number
13739682 or by identifying "Independent Bank Group Second Quarter
2023 Earnings Conference Call." The conference materials will also
be available by accessing the Investor Relations page of our
website, https://ir.ifinancial.com. If you are unable to
participate in the live event, a recording of the conference call
will be accessible via the Investor Relations page of our
website.
Forward-Looking Statements
From time to time the Company’s comments and releases may
contain “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995 that are subject
to risks and uncertainties and are made pursuant to the safe harbor
provisions of Section 27A of the Securities Act, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended, and
other related federal security laws. Forward-looking statements
include information about the Company’s possible or assumed future
results of operations, including its future revenues, income,
expenses, provision for taxes, effective tax rate, earnings (loss)
per share and cash flows, its future capital expenditures and
dividends, its future financial condition and changes therein,
including changes in the Company’s loan portfolio and allowance for
credit losses, the Company’s future capital structure or changes
therein, the plan and objectives of management for future
operations, the Company’s future or proposed acquisitions, the
future or expected effect of acquisitions on the Company’s
operations, results of operations and financial condition, the
Company’s future economic performance and the statements of the
assumptions underlying any such statement. Such statements are
typically, but not exclusively, identified by the use in the
statements of words or phrases such as “aim,” “anticipate,”
“estimate,” “expect,” “goal,” “guidance,” “intend,” “is
anticipated,” “is estimated,” “is expected,” “is intended,”
“objective,” “plan,” “projected,” “projection,” “will affect,”
“will be,” “will continue,” “will decrease,” “will grow,” “will
impact,” “will increase,” “will incur,” “will reduce,” “will
remain,” “will result,” “would be,” variations of such words or
phrases (including where the word “could,” “may” or “would” is used
rather than the word “will” in a phrase) and similar words and
phrases indicating that the statement addresses some future result,
occurrence, plan or objective. The forward-looking statements that
the Company makes are based on its current expectations and
assumptions regarding its business, the economy, and other future
conditions. Because forward-looking statements relate to future
results and occurrences, they are subject to inherent
uncertainties, risks, and changes in circumstances that are
difficult to predict. The Company’s actual results may differ
materially from those contemplated by the forward looking
statements, which are neither statements of historical fact nor
guarantees or assurances of future performance. Many possible
events or factors could affect the Company’s future financial
results and performance and could cause those results or
performance to differ materially from those expressed in the
forward-looking statements. These possible events or factors
include, but are not limited to: 1) the effects of infectious
disease outbreaks, including the ongoing COVID-19 pandemic and the
significant impact that the COVID-19 pandemic and associated
efforts to limit its spread have had and may continue to have on
economic conditions and the Company's business, employees,
customers, asset quality and financial performance; 2) the
Company’s ability to sustain its current internal growth rate and
total growth rate; 3) changes in geopolitical, business and
economic events, occurrences and conditions, including changes in
rates of inflation or deflation, nationally, regionally and in the
Company’s target markets, particularly in Texas and Colorado; 4)
worsening business and economic conditions nationally, regionally
and in the Company’s target markets, particularly in Texas and
Colorado, and the geographic areas in those states in which the
Company operates; 5) the Company’s dependence on its management
team and its ability to attract, motivate and retain qualified
personnel; 6) the concentration of the Company’s business within
its geographic areas of operation in Texas and Colorado; 7) changes
in asset quality, including increases in default rates on loans and
higher levels of nonperforming loans and loan charge-offs
generally; 8) concentration of the loan portfolio of Independent
Financial, before and after the completion of acquisitions of
financial institutions, in commercial and residential real estate
loans and changes in the prices, values and sales volumes of
commercial and residential real estate; 9) the ability of
Independent Financial to make loans with acceptable net interest
margins and levels of risk of repayment and to otherwise invest in
assets at acceptable yields and that present acceptable investment
risks; 10) inaccuracy of the assumptions and estimates that the
managements of the Company and the financial institutions that the
Company acquires make in establishing reserves for credit losses
and other estimates generally; 11) lack of liquidity, including as
a result of a reduction in the amount of sources of liquidity the
Company currently has; 12) material increases or decreases in the
amount of deposits held by Independent Financial or other financial
institutions that the Company acquires and the cost of those
deposits; 13) the Company’s access to the debt and equity markets
and the overall cost of funding its operations; 14) regulatory
requirements to maintain minimum capital levels or maintenance of
capital at levels sufficient to support the Company’s anticipated
growth; 15) changes in market interest rates that affect the
pricing of the loans and deposits of each of Independent Financial
and the financial institutions that the Company acquires and that
affect the net interest income, other future cash flows, or the
market value of the assets of each of Independent Financial and the
financial institutions that the Company acquires, including
investment securities; 16) fluctuations in the market value and
liquidity of the securities the Company holds for sale, including
as a result of changes in market interest rates; 17) effects of
competition from a wide variety of local, regional, national and
other providers of financial, investment and insurance services;
18) changes in economic and market conditions, that affect the
amount and value of the assets of Independent Financial and of
financial institutions that the Company acquires; 19) the
institution and outcome of, and costs associated with, litigation
and other legal proceedings against one or more of the Company,
Independent Financial and financial institutions that the Company
acquired or will acquire or to which any of such entities is
subject; 20) the occurrence of market conditions adversely
affecting the financial industry generally; 21) the impact of
recent and future legislative regulatory changes, including changes
in banking, securities, and tax laws and regulations and their
application by the Company’s regulators, and changes in federal
government policies, as well as regulatory requirements applicable
to, and resulting from regulatory supervision of, the Company and
Independent Financial as a financial institution with total assets
greater than $10 billion; 22) changes in accounting policies,
practices, principles and guidelines, as may be adopted by the bank
regulatory agencies, the Financial Accounting Standards Board, the
SEC and the Public Company Accounting Oversight Board, as the case
may be; 23) governmental monetary and fiscal policies; 24) changes
in the scope and cost of FDIC insurance and other coverage; 25) the
effects of war or other conflicts, including, but not limited to,
the conflict between Russia and the Ukraine, acts of terrorism
(including cyberattacks) or other catastrophic events, including
natural disasters such as storms, droughts, tornadoes, hurricanes
and flooding, that may affect general economic conditions; 26) the
Company’s actual cost savings resulting from previous or future
acquisitions are less than expected, the Company is unable to
realize those cost savings as soon as expected, or the Company
incurs additional or unexpected costs; 27) the Company’s revenues
after previous or future acquisitions are less than expected; 28)
the liquidity of, and changes in the amounts and sources of
liquidity available to the Company, before and after the
acquisition of any financial institutions that the Company
acquires; 29) deposit attrition, operating costs, customer loss and
business disruption before and after the Company completed
acquisitions, including, without limitation, difficulties in
maintaining relationships with employees, may be greater than the
Company expected; 30) the effects of the combination of the
operations of financial institutions that the Company has acquired
in the recent past or may acquire in the future with the Company’s
operations and the operations of Independent Financial, the effects
of the integration of such operations being unsuccessful, and the
effects of such integration being more difficult, time consuming,
or costly than expected or not yielding the cost savings the
Company expects; 31) the impact of investments that the Company or
Independent Financial may have made or may make and the changes in
the value of those investments; 32) the quality of the assets of
financial institutions and companies that the Company has acquired
in the recent past or may acquire in the future being different
than it determined or determine in its due diligence investigation
in connection with the acquisition of such financial institutions
and any inadequacy of credit loss reserves relating to, and
exposure to unrecoverable losses on, loans acquired; 33) the
Company’s ability to continue to identify acquisition targets and
successfully acquire desirable financial institutions to sustain
its growth, to expand its presence in the Company’s markets and to
enter new markets; 34) changes in general business and economic
conditions in the markets in which the Company currently operates
and may operate in the future; 35) changes occur in business
conditions and inflation generally; 36) an increase in the rate of
personal or commercial customers’ bankruptcies generally; 37)
technology-related changes are harder to make or are more expensive
than expected; 38) attacks on the security of, and breaches of, the
Company's and Independent Financial's digital infrastructure or
information systems, the costs the Company or Independent Financial
incur to provide security against such attacks and any costs and
liability the Company or Independent Financial incurs in connection
with any breach of those systems; 39) the potential impact of
climate change and related government regulation on the Company and
its customers; 40) the potential impact of technology and “FinTech”
entities on the banking industry generally; 41) other economic,
competitive, governmental, regulatory, technological and
geopolitical factors affecting the Company's operations, pricing
and services; and 42) the other factors that are described or
referenced in Part I, Item 1A, of the Company’s Annual Report on
Form 10-K filed with the SEC on February 21, 2023, the Company’s
Quarterly Reports on Form 10-Q, in each case under the caption
“Risk Factors”; and The Company urges you to consider all of these
risks, uncertainties and other factors carefully in evaluating all
such forward-looking statements made by the Company. As a result of
these and other matters, including changes in facts, assumptions
not being realized or other factors, the actual results relating to
the subject matter of any forward-looking statement may differ
materially from the anticipated results expressed or implied in
that forward-looking statement. Any forward-looking statement made
in this filing or made by the Company in any report, filing,
document or information incorporated by reference in this filing,
speaks only as of the date on which it is made. The Company
undertakes no obligation to update any such forward-looking
statement, whether as a result of new information, future
developments or otherwise, except as may be required by law. A
forward-looking statement may include a statement of the
assumptions or bases underlying the forward-looking statement. The
Company believes that these assumptions or bases have been chosen
in good faith and that they are reasonable. However, the Company
cautions you that assumptions as to future occurrences or results
almost always vary from actual future occurrences or results, and
the differences between assumptions and actual occurrences and
results can be material. Therefore, the Company cautions you not to
place undue reliance on the forward-looking statements contained in
this filing or incorporated by reference herein.
Non-GAAP Financial Measures
In addition to results presented in accordance with GAAP, this
press release contains certain non-GAAP financial measures. These
measures and ratios include “adjusted net income,” “adjusted
earnings,” “tangible book value,” “tangible book value per common
share,” “adjusted efficiency ratio,” “tangible common equity to
tangible assets,” “adjusted net interest margin,” “return on
tangible equity,” “adjusted return on average assets” and “adjusted
return on average equity” and are supplemental measures that are
not required by, or are not presented in accordance with,
accounting principles generally accepted in the United States. We
consider the use of select non-GAAP financial measures and ratios
to be useful for financial operational decision making and useful
in evaluating period-to-period comparisons. We believe that these
non-GAAP financial measures provide meaningful supplemental
information regarding our performance by excluding certain
expenditures or assets that we believe are not indicative of our
primary business operating results. We believe that management and
investors benefit from referring to these non-GAAP financial
measures in assessing our performance and when planning,
forecasting, analyzing and comparing past, present and future
periods.
We believe that these 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 our financial
measures have a number of limitations relative to GAAP financial
measures. Certain non-GAAP financial measures exclude items of
income, expenditures, expenses, assets, or liabilities, including
provisions for credit losses and the effect of goodwill, other
intangible assets and income from accretion on acquired loans
arising from purchase accounting adjustments, that we believe cause
certain aspects of our results of operations or financial condition
to be not indicative of our primary operating results. All of these
items significantly impact our financial statements. Additionally,
the items that we exclude in our adjustments are not necessarily
consistent with the items that our peers may exclude from their
results of operations and key financial measures and therefore may
limit the comparability of similarly named financial measures and
ratios. We compensate for these limitations by providing the
equivalent GAAP measures whenever we present the non-GAAP financial
measures and by including a reconciliation of the impact of the
components adjusted for in the non-GAAP financial measure so that
both measures and the individual components may be considered when
analyzing our performance.
A reconciliation of our non-GAAP financial measures to the
comparable GAAP financial measures is included at the end of the
financial statements tables.
Independent Bank Group, Inc. and
Subsidiaries
Consolidated Financial Data
Three Months Ended June 30, 2023, March
31, 2023, December 31, 2022, September 30, 2022 and June 30,
2022
(Dollars in thousands, except for share
data)
(Unaudited)
As of and for the Quarter
Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
Selected Income Statement Data
Interest income
$
215,294
$
201,176
$
189,769
$
173,687
$
150,696
Interest expense
101,687
73,254
47,982
26,413
12,697
Net interest income
113,607
127,922
141,787
147,274
137,999
Provision for credit losses
220
90
2,833
3,100
—
Net interest income after provision for
credit losses
113,387
127,832
138,954
144,174
137,999
Noninterest income
14,095
12,754
11,227
13,477
13,877
Noninterest expense
85,705
189,380
98,774
91,733
85,925
Income tax expense (benefit)
8,700
(11,284
)
10,653
13,481
13,591
Net income (loss)
33,077
(37,510
)
40,754
52,437
52,360
Adjusted net income (1)
33,726
44,083
49,433
54,880
53,304
Per Share Data (Common Stock)
Earnings (loss):
Basic
$
0.80
$
(0.91
)
$
0.99
$
1.27
$
1.25
Diluted
0.80
(0.91
)
0.99
1.27
1.25
Adjusted earnings:
Basic (1)
0.82
1.07
1.20
1.33
1.28
Diluted (1)
0.82
1.07
1.20
1.33
1.27
Dividends
0.38
0.38
0.38
0.38
0.38
Book value
57.00
56.95
57.91
57.19
57.45
Tangible book value (1)
31.55
31.42
32.25
31.44
31.61
Common shares outstanding
41,279,460
41,281,904
41,190,677
41,165,006
41,156,261
Weighted average basic shares outstanding
(2)
41,280,312
41,223,376
41,193,716
41,167,258
41,737,534
Weighted average diluted shares
outstanding (2)
41,365,275
41,316,798
41,285,383
41,253,662
41,813,443
Selected Period End Balance Sheet
Data
Total assets
$
18,719,802
$
18,798,354
$
18,258,414
$
17,944,493
$
18,107,093
Cash and cash equivalents
902,882
1,048,590
654,322
516,159
776,131
Securities available for sale
1,637,682
1,675,415
1,691,784
1,730,163
1,846,132
Securities held to maturity
206,146
206,602
207,059
207,516
207,972
Loans, held for sale
18,624
16,576
11,310
21,973
26,519
Loans, held for investment (3)
13,628,025
13,606,039
13,597,264
13,285,757
12,979,938
Mortgage warehouse purchase loans
491,090
400,547
312,099
409,044
538,190
Allowance for credit losses on loans
147,804
146,850
148,787
146,395
144,170
Goodwill and other intangible assets
1,050,798
1,053,909
1,057,020
1,060,131
1,063,248
Other real estate owned
22,505
22,700
23,900
23,900
12,900
Noninterest-bearing deposits
3,905,492
4,148,360
4,736,830
5,107,001
5,123,321
Interest-bearing deposits
10,968,014
9,907,327
10,384,587
9,854,007
9,940,627
Borrowings (other than junior subordinated
debentures)
1,180,262
2,137,607
567,066
466,892
509,718
Junior subordinated debentures
54,518
54,469
54,419
54,370
54,320
Total stockholders' equity
2,353,042
2,350,857
2,385,383
2,354,340
2,364,335
Independent Bank Group, Inc. and
Subsidiaries
Consolidated Financial Data
Three Months Ended June 30, 2023, March
31, 2023, December 31, 2022, September 30, 2022 and June 30,
2022
(Dollars in thousands, except for share
data)
(Unaudited)
As of and for the Quarter
Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
Selected Performance Metrics
Return on average assets
0.71
%
(0.83
)%
0.90
%
1.16
%
1.19
%
Return on average equity
5.62
(6.39
)
6.85
8.66
8.62
Return on tangible equity (4)
10.14
(11.48
)
12.42
15.52
15.32
Adjusted return on average assets (1)
0.73
0.98
1.09
1.22
1.21
Adjusted return on average equity (1)
5.73
7.51
8.31
9.07
8.78
Adjusted return on tangible equity (1)
(4)
10.34
13.49
15.07
16.24
15.60
Net interest margin
2.71
3.17
3.49
3.64
3.51
Efficiency ratio (5)
64.68
132.41
62.52
55.13
54.52
Adjusted efficiency ratio (1) (5)
63.93
58.17
55.51
53.23
53.75
Credit Quality Ratios (3) (6)
Nonperforming assets to total assets
0.32
%
0.32
%
0.35
%
0.45
%
0.46
%
Nonperforming loans to total loans held
for investment
0.28
0.27
0.29
0.43
0.54
Nonperforming assets to total loans held
for investment and other real estate
0.44
0.44
0.47
0.61
0.64
Allowance for credit losses on loans to
nonperforming loans
389.84
393.69
371.14
256.65
206.28
Allowance for credit losses to total loans
held for investment
1.08
1.08
1.09
1.10
1.11
Net (recoveries) charge-offs to average
loans outstanding (annualized)
(0.03
)
0.04
0.02
0.04
0.09
Capital Ratios
Estimated common equity Tier 1 capital to
risk-weighted assets
9.78
%
9.70
%
10.09
%
10.00
%
9.81
%
Estimated tier 1 capital to average
assets
8.92
9.01
9.49
9.41
9.28
Estimated tier 1 capital to risk-weighted
assets
10.13
10.05
10.45
10.35
10.17
Estimated total capital to risk-weighted
assets
11.95
11.88
12.35
12.27
12.24
Total stockholders' equity to total
assets
12.57
12.51
13.06
13.12
13.06
Tangible common equity to tangible assets
(1)
7.37
7.31
7.72
7.67
7.63
________________
(1) Non-GAAP financial measure. See
reconciliation.
(2) Total number of shares includes
participating shares (those with dividend rights).
(3) Loans held for investment excludes
mortgage warehouse purchase loans and includes SBA PPP loans of
$3,277, $3,542, $4,958, $7,029 and $26,669, respectively.
(4) Non-GAAP financial measure. Excludes
average balance of goodwill and net other intangible assets.
(5) Efficiency ratio excludes amortization
of other intangible assets. See reconciliation of Non-GAAP
financial measures.
(6) Credit metrics - Nonperforming assets,
which consist of nonperforming loans, OREO and other repossessed
assets, totaled $60,533, $60,115, $64,109, $81,054 and $82,905,
respectively. Nonperforming loans, which consists of nonaccrual
loans, loans delinquent 90 days and still accruing interest, and
troubled debt restructurings (TDR) totaled $37,914, $37,301,
$40,089, $57,040 and $69,891, respectively. With the adoption of
ASU 2022-02, effective January 1, 2023, TDR accounting has been
eliminated.
Independent Bank Group, Inc. and
Subsidiaries
Consolidated Statements of Income
Three and Six Months Ended June 30, 2023
and 2022
(Dollars in thousands)
(Unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Interest income:
Interest and fees on loans
$
193,612
$
138,426
$
377,906
$
267,605
Interest on taxable securities
7,791
8,243
15,649
16,602
Interest on nontaxable securities
2,586
2,741
5,189
5,074
Interest on interest-bearing deposits and
other
11,305
1,286
17,726
2,280
Total interest income
215,294
150,696
416,470
291,561
Interest expense:
Interest on deposits
78,144
8,110
140,405
13,720
Interest on FHLB advances
18,025
164
23,849
343
Interest on other borrowings
4,361
3,869
8,440
7,351
Interest on junior subordinated
debentures
1,157
554
2,247
1,000
Total interest expense
101,687
12,697
174,941
22,414
Net interest income
113,607
137,999
241,529
269,147
Provision for credit losses
220
—
310
(1,443
)
Net interest income after provision for
credit losses
113,387
137,999
241,219
270,590
Noninterest income:
Service charges on deposit accounts
3,519
3,050
6,868
5,802
Investment management fees
2,444
2,391
4,745
4,842
Mortgage banking revenue
2,248
2,490
3,872
5,516
Mortgage warehouse purchase program
fees
535
731
859
1,689
Loss on sale of loans
(7
)
(17
)
(7
)
(1,501
)
Gain (loss) on sale and disposal of
premises and equipment
354
(46
)
401
(209
)
Increase in cash surrender value of
BOLI
1,410
1,327
2,787
2,637
Other
3,592
3,951
7,324
7,986
Total noninterest income
14,095
13,877
26,849
26,762
Noninterest expense:
Salaries and employee benefits
46,940
51,130
93,215
100,685
Occupancy
11,640
10,033
23,199
20,033
Communications and technology
7,196
5,830
14,286
11,731
FDIC assessment
3,806
1,589
6,518
3,082
Advertising and public relations
1,004
703
1,608
1,159
Other real estate owned (income) expenses,
net
(185
)
66
(229
)
66
Impairment of other real estate
1,000
—
2,200
—
Amortization of other intangible
assets
3,111
3,118
6,222
6,263
Litigation settlement
—
—
102,500
—
Professional fees
1,785
4,094
4,850
7,533
Other
9,408
9,362
20,716
17,830
Total noninterest expense
85,705
85,925
275,085
168,382
Income (loss) before taxes
41,777
65,951
(7,017
)
128,970
Income tax expense (benefit)
8,700
13,591
(2,584
)
25,870
Net income (loss)
$
33,077
$
52,360
$
(4,433
)
$
103,100
Independent Bank Group, Inc. and
Subsidiaries
Consolidated Balance Sheets
As of June 30, 2023 and December 31,
2022
(Dollars in thousands)
(Unaudited)
June 30,
December 31,
Assets
2023
2022
Cash and due from banks
$
127,438
$
134,183
Interest-bearing deposits in other
banks
775,444
520,139
Cash and cash equivalents
902,882
654,322
Certificates of deposit held in other
banks
248
496
Securities available for sale, at fair
value
1,637,682
1,691,784
Securities held to maturity, net of
allowance for credit losses of $0 and $0, respectively
206,146
207,059
Loans held for sale (includes $12,212 and
$10,612 carried at fair value, respectively)
18,624
11,310
Loans, net of allowance for credit losses
of $147,804 and $148,787, respectively
13,971,311
13,760,576
Premises and equipment, net
354,941
355,368
Other real estate owned
22,505
23,900
Federal Home Loan Bank (FHLB) of Dallas
stock and other restricted stock
67,520
23,436
Bank-owned life insurance (BOLI)
242,805
240,448
Deferred tax asset
97,289
78,669
Goodwill
994,021
994,021
Other intangible assets, net
56,777
62,999
Other assets
147,051
154,026
Total assets
$
18,719,802
$
18,258,414
Liabilities and Stockholders’
Equity
Deposits:
Noninterest-bearing
$
3,905,492
$
4,736,830
Interest-bearing
10,968,014
10,384,587
Total deposits
14,873,506
15,121,417
FHLB advances
875,000
300,000
Other borrowings
305,262
267,066
Junior subordinated debentures
54,518
54,419
Other liabilities
258,474
130,129
Total liabilities
16,366,760
15,873,031
Commitments and contingencies
—
—
Stockholders’ equity:
Preferred stock (0 and 0 shares
outstanding, respectively)
—
—
Common stock (41,279,460 and 41,190,677
shares outstanding, respectively)
413
412
Additional paid-in capital
1,964,341
1,959,193
Retained earnings
600,829
638,354
Accumulated other comprehensive loss
(212,541
)
(212,576
)
Total stockholders’ equity
2,353,042
2,385,383
Total liabilities and stockholders’
equity
$
18,719,802
$
18,258,414
Independent Bank Group, Inc. and
Subsidiaries
Consolidated Average Balance Sheet
Amounts, Interest Earned and Yield Analysis
Three Months Ended June 30, 2023 and
2022
(Dollars in thousands)
(Unaudited)
The analysis below shows average
interest-earning assets and interest-bearing liabilities together
with the average yield on the interest-earning assets and the
average cost of the interest-bearing liabilities for the periods
presented.
Three Months Ended June
30,
2023
2022
Average Outstanding
Balance
Interest
Yield/ Rate (4)
Average Outstanding
Balance
Interest
Yield/ Rate (4)
Interest-earning assets:
Loans (1)
$
14,027,773
$
193,612
5.54
%
$
12,993,624
$
138,426
4.27
%
Taxable securities
1,456,873
7,791
2.14
1,703,850
8,243
1.94
Nontaxable securities
418,575
2,586
2.48
440,972
2,741
2.49
Interest-bearing deposits and other
893,752
11,305
5.07
649,649
1,286
0.79
Total interest-earning assets
16,796,973
215,294
5.14
15,788,095
150,696
3.83
Noninterest-earning assets
1,855,477
1,927,894
Total assets
$
18,652,450
$
17,715,989
Interest-bearing liabilities:
Checking accounts
$
5,646,603
$
41,943
2.98
%
$
5,881,199
$
4,587
0.31
%
Savings accounts
638,292
83
0.05
797,211
97
0.05
Money market accounts
1,421,920
11,012
3.11
2,072,654
2,709
0.52
Certificates of deposit
2,614,849
25,106
3.85
877,237
717
0.33
Total deposits
10,321,664
78,144
3.04
9,628,301
8,110
0.34
FHLB advances
1,412,637
18,025
5.12
132,143
164
0.50
Other borrowings - short-term
74,643
1,291
6.94
42,402
405
3.83
Other borrowings - long-term
237,708
3,070
5.18
266,658
3,464
5.21
Junior subordinated debentures
54,501
1,157
8.51
54,303
554
4.09
Total interest-bearing
liabilities
12,101,153
101,687
3.37
10,123,807
12,697
0.50
Noninterest-bearing checking accounts
3,979,818
5,044,507
Noninterest-bearing liabilities
211,253
112,558
Stockholders’ equity
2,360,226
2,435,117
Total liabilities and equity
$
18,652,450
$
17,715,989
Net interest income
$
113,607
$
137,999
Interest rate spread
1.77
%
3.33
%
Net interest margin (2)
2.71
3.51
Net interest income and margin (tax
equivalent basis) (3)
$
114,642
2.74
$
139,112
3.53
Average interest-earning assets to
interest-bearing liabilities
138.80
155.95
_______________
(1) Average loan balances include
nonaccrual loans.
(2) Net interest margins for the periods
presented represent: (i) the difference between interest income on
interest-earning assets and the interest expense on
interest-bearing liabilities, divided by (ii) average
interest-earning assets for the period.
(3) A tax-equivalent adjustment has been
computed using a federal income tax rate of 21%.
(4) Yield and rates for the three month
periods are annualized.
Independent Bank Group, Inc. and
Subsidiaries
Consolidated Average Balance Sheet
Amounts, Interest Earned and Yield Analysis
Six Months Ended June 30, 2023 and
2022
(Dollars in thousands)
(Unaudited)
The analysis below shows average
interest-earning assets and interest-bearing liabilities together
with the average yield on the interest-earning assets and the
average cost of the interest-bearing liabilities for the periods
presented.
Six Months Ended June
30,
2023
2022
Average Outstanding
Balance
Interest
Yield/ Rate (4)
Average Outstanding
Balance
Interest
Yield/ Rate (4)
Interest-earning assets:
Loans (1)
$
13,980,015
$
377,906
5.45
%
$
12,658,541
$
267,605
4.26
%
Taxable securities
1,460,902
15,649
2.16
1,696,572
16,602
1.97
Nontaxable securities
421,052
5,189
2.49
426,447
5,074
2.40
Interest-bearing deposits and other
723,305
17,726
4.94
1,377,902
2,280
0.33
Total interest-earning assets
16,585,274
416,470
5.06
16,159,462
291,561
3.64
Noninterest-earning assets
1,856,383
1,916,191
Total assets
$
18,441,657
$
18,075,653
Interest-bearing liabilities:
Checking accounts
$
5,958,145
$
80,836
2.74
%
$
6,058,317
$
7,669
0.26
%
Savings accounts
683,321
173
0.05
788,842
191
0.05
Money market accounts
1,598,603
23,446
2.96
2,204,570
4,412
0.40
Certificates of deposit
2,115,827
35,950
3.43
925,099
1,448
0.32
Total deposits
10,355,896
140,405
2.73
9,976,828
13,720
0.28
FHLB advances
997,099
23,849
4.82
141,022
343
0.49
Other borrowings - short-term
39,743
1,344
6.82
23,048
423
3.70
Other borrowings - long-term
252,034
7,096
5.68
266,571
6,928
5.24
Junior subordinated debentures
54,476
2,247
8.32
54,278
1,000
3.72
Total interest-bearing
liabilities
11,699,248
174,941
3.02
10,461,747
22,414
0.43
Noninterest-bearing checking accounts
4,191,141
5,002,121
Noninterest-bearing liabilities
181,000
106,723
Stockholders’ equity
2,370,268
2,505,062
Total liabilities and equity
$
18,441,657
$
18,075,653
Net interest income
$
241,529
$
269,147
Interest rate spread
2.04
%
3.21
%
Net interest margin (2)
2.94
3.36
Net interest income and margin (tax
equivalent basis) (3)
$
243,604
2.96
$
271,290
3.39
Average interest-earning assets to
interest-bearing liabilities
141.76
154.46
________________
(1) Average loan balances include
nonaccrual loans.
(2) Net interest margins for the periods
presented represent: (i) the difference between interest income on
interest-earning assets and the interest expense on
interest-bearing liabilities, divided by (ii) average
interest-earning assets for the period.
(3) A tax-equivalent adjustment has been
computed using a federal income tax rate of 21%.
(4) Yield and rates for the six month
periods are annualized.
Independent Bank Group, Inc. and
Subsidiaries
Loan Portfolio Composition
As of June 30, 2023 and December 31,
2022
(Dollars in thousands)
(Unaudited)
Total Loans By Class
June 30, 2023
December 31, 2022
Amount
% of Total
Amount
% of Total
Commercial (1)
$
2,216,957
15.7
%
$
2,240,959
16.1
%
Mortgage warehouse purchase loans
491,090
3.5
312,099
2.2
Real estate:
Commercial real estate
7,990,123
56.5
7,817,447
56.2
Commercial construction, land and land
development
1,122,400
7.9
1,231,071
8.8
Residential real estate (2)
1,634,527
11.6
1,604,169
11.5
Single-family interim construction
483,274
3.4
508,839
3.7
Agricultural
118,054
0.8
124,422
0.9
Consumer
81,314
0.6
81,667
0.6
Total loans
14,137,739
100.0
%
13,920,673
100.0
%
Allowance for credit losses
(147,804
)
(148,787
)
Total loans, net
$
13,989,935
$
13,771,886
_______________
(1) Includes SBA PPP loans of $3,277 with
net deferred loan fees of $69 and $4,958 with net deferred fees of
$101 at June 30, 2023 and December 31, 2022, respectively.
(2) Includes loans held for sale of
$18,624 and $11,310 at June 30, 2023 and December 31, 2022,
respectively.
Independent Bank Group, Inc. and
Subsidiaries
Reconciliation of Non-GAAP Financial
Measures
Three Months Ended June 30, 2023, March
31, 2023, December 31, 2022, September 30, 2022 and June 30,
2022
(Dollars in thousands, except for share
data)
(Unaudited)
For the Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
ADJUSTED NET INCOME
Net Interest Income - Reported
(a)
$
113,607
$
127,922
$
141,787
$
147,274
$
137,999
Provision Expense - Reported
(b)
220
90
2,833
3,100
—
Noninterest Income - Reported
(c)
14,095
12,754
11,227
13,477
13,877
Loss on sale of loans
7
—
343
—
17
(Gain) loss on sale and disposal of
premises and equipment
(354
)
(47
)
184
101
46
Recoveries on loans charged off prior to
acquisition
(13
)
(117
)
(36
)
(60
)
(45
)
Adjusted Noninterest Income
(d)
13,735
12,590
11,718
13,518
13,895
Noninterest Expense - Reported
(e)
85,705
189,380
98,774
91,733
85,925
Litigation settlement
—
(102,500
)
—
—
—
Separation expense (1)
—
—
(7,131
)
(2,809
)
(1,106
)
Economic development employee incentive
grant
—
—
—
1,000
—
OREO impairment
(1,000
)
(1,200
)
—
—
—
Impairment of assets
(153
)
(802
)
(3,286
)
(1,156
)
—
Acquisition expense (2)
(27
)
(26
)
(40
)
(65
)
(65
)
Adjusted Noninterest Expense
(f)
84,525
84,852
88,317
88,703
84,754
Income Tax Expense (Benefit) -
Reported
(g)
8,700
(11,284
)
10,653
13,481
13,591
Net Income (Loss) - Reported
(a) - (b) + (c) - (e) - (g) = (h)
33,077
(37,510
)
40,754
52,437
52,360
Adjusted Net Income (3)
(a) - (b) + (d) - (f) = (i)
$
33,726
$
44,083
$
49,433
$
54,880
$
53,304
ADJUSTED PROFITABILITY (4)
Total Average Assets
(j)
$
18,652,450
$
18,228,521
$
17,994,131
$
17,893,072
$
17,715,989
Total Average Stockholders' Equity
(k)
2,360,226
2,380,421
2,359,637
2,401,544
2,435,117
Total Average Tangible Stockholders'
Equity (5)
(l)
1,308,368
1,325,475
1,301,558
1,340,363
1,370,825
Reported Return on Average
Assets
(h) / (j)
0.71
%
(0.83
)%
0.90
%
1.16
%
1.19
%
Reported Return on Average
Equity
(h) / (k)
5.62
(6.39
)
6.85
8.66
8.62
Reported Return on Average Tangible
Equity
(h) / (l)
10.14
(11.48
)
12.42
15.52
15.32
Adjusted Return on Average Assets
(6)
(i) / (j)
0.73
0.98
1.09
1.22
1.21
Adjusted Return on Average Equity
(6)
(i) / (k)
5.73
7.51
8.31
9.07
8.78
Adjusted Return on Tangible Equity
(6)
(i) / (l)
10.34
13.49
15.07
16.24
15.60
EFFICIENCY RATIO
Amortization of other intangible
assets
(m)
$
3,111
$
3,111
$
3,111
$
3,117
$
3,118
Reported Efficiency Ratio
(e - m) / (a + c)
64.68
%
132.41
%
62.52
%
55.13
%
54.52
%
Adjusted Efficiency Ratio
(f - m) / (a + d)
63.93
58.17
55.51
53.23
53.75
_________________
(1) Separation expenses include severance
and accelerated vesting expense for stock awards related to the
separation of certain employees. The quarter ended December 31,
2022 reflects a reduction in workforce due to the restructuring of
certain departments and business lines. The quarters ended
September 30, 2022 and June 30, 2022 reflect payments made due to
the separation of executive officers, while the quarter ended
September 30, 2022 also includes $202 thousand in severance
payments and accelerated vesting expense for stock awards related
to the dissolution of a Company department.
(2) Acquisition expenses includes
compensation related expenses for equity awards granted at
acquisition.
(3) Assumes an adjusted effective tax rate
of 20.8%, 20.7%, 20.7%, 20.5%, and 20.6%, respectively. First
quarter 2023 normalized rate excludes the effect of the litigation
settlement.
(4) Quarterly metrics are annualized.
(5) Excludes average balance of goodwill
and net other intangible assets.
(6) Calculated using adjusted net
income.
Independent Bank Group, Inc. and
Subsidiaries
Reconciliation of Non-GAAP Financial
Measures
As of June 30, 2023, March 31, 2023,
December 31, 2022, September 30, 2022 and June 30, 2022
(Dollars in thousands, except per share
information)
(Unaudited)
Tangible Book Value & Tangible
Common Equity To Tangible Assets Ratio
As of the Quarter Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
Tangible Common Equity
Total common stockholders' equity
$
2,353,042
$
2,350,857
$
2,385,383
$
2,354,340
$
2,364,335
Adjustments:
Goodwill
(994,021
)
(994,021
)
(994,021
)
(994,021
)
(994,021
)
Other intangible assets, net
(56,777
)
(59,888
)
(62,999
)
(66,110
)
(69,227
)
Tangible common equity
$
1,302,244
$
1,296,948
$
1,328,363
$
1,294,209
$
1,301,087
Tangible Assets
Total assets
$
18,719,802
$
18,798,354
$
18,258,414
$
17,944,493
$
18,107,093
Adjustments:
Goodwill
(994,021
)
(994,021
)
(994,021
)
(994,021
)
(994,021
)
Other intangible assets, net
(56,777
)
(59,888
)
(62,999
)
(66,110
)
(69,227
)
Tangible assets
$
17,669,004
$
17,744,445
$
17,201,394
$
16,884,362
$
17,043,845
Common shares outstanding
41,279,460
41,281,904
41,190,677
41,165,006
41,156,261
Tangible common equity to tangible
assets
7.37
%
7.31
%
7.72
%
7.67
%
7.63
%
Book value per common share
$
57.00
$
56.95
$
57.91
$
57.19
$
57.45
Tangible book value per common share
31.55
31.42
32.25
31.44
31.61
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230724869507/en/
Analysts/Investors: Paul Langdale Executive Vice
President, Chief Financial Officer (972) 562-9004
Paul.Langdale@ifinancial.com
Media: Wendi Costlow Executive Vice President, Chief
Marketing Officer (972) 562-9004 Wendi.Costlow@ifinancial.com
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