Investor Relations

Investor Relations

Press Release

Allegiance Bancshares, Inc. Reports Record Fourth Quarter and Full Year 2019 Results

Company Release - 1/29/2020 7:00 AM ET
  • Record diluted earnings per share of $0.67 for the fourth quarter 2019 and $2.47 for the year 2019
     
  • Deposit growth of $405.6 million, or 11.1%, for the year 2019
     
  • Declared first quarterly dividend of $0.10 per share

HOUSTON, Jan. 29, 2020 (GLOBE NEWSWIRE) -- Allegiance Bancshares, Inc. (NASDAQ: ABTX) ("Allegiance"), the holding company of Allegiance Bank (the "Bank"), today reported net income of $14.0 million and diluted earnings per share of $0.67 for the fourth quarter 2019 compared to net income of $13.2 million and diluted earnings per share of $0.59 for the fourth quarter 2018.  Net income for the year ended December 31, 2019 was $53.0 million, or $2.47 per diluted share, compared to net income of $37.3 million, or $2.37 per diluted share, for the year ended December 31, 2018.  The year ended December 31, 2019 results included $1.4 million of pre-tax severance expense and $1.3 million of pre-tax acquisition and merger-related expenses. The year ended December 31, 2018 results included $1.7 million of pre-tax acquisition and merger-related expenses.

“2019 was another successful year for Allegiance,” said Steve Retzloff, Allegiance’s Chief Executive Officer.  “We reported record quarterly and annual diluted earnings per share driven by core loan growth, deposit growth and continued excellent asset quality.  The results are indicative of the dedication, hard work and commitment of our bankers to enhance our business capabilities and technology to best serve our customers and communities in which we operate,” commented Retzloff.

“We are excited to announce Allegiance’s first quarterly cash dividend of $0.10 per share to our shareholders. This dividend represents a significant milestone for Allegiance and along with the continuation of our share repurchase program highlights the profitability and solid capital position that we have achieved since our founding and reflects our commitment to long-term shareholder value,” continued Retzloff.

“As Houston’s largest locally-headquartered community bank, we feel very well positioned for 2020.  We entered the year with strong fundamentals, momentum and a clear focus on our priorities.  We are confident that our experienced team of bankers are the best in the business who will continue to execute our strategy and generate great customer relationships while driving solid returns for Allegiance and our shareholders," concluded Retzloff.

Fourth Quarter 2019 Results

Net interest income before the provision for loan losses in the fourth quarter 2019 decreased $1.3 million, or 2.9%, to $44.5 million from $45.8 million for the fourth quarter 2018. Net interest income before provision for loan losses for the fourth quarter 2019 decreased from $44.8 million in the third quarter 2019.  These decreases were primarily due to changes in market interest rates, acquisition accounting accretion as well as changes in the volume and relative mix of the underlying assets and liabilities.  The net interest margin on a tax equivalent basis decreased 34 basis points to 4.11% for the fourth quarter 2019 from 4.45% for the fourth quarter 2018 and decreased 5 basis points from 4.16% for the third quarter 2019. Core net interest margin on a tax equivalent basis excludes the impact of acquisition accounting adjustments and was 3.94% for the fourth quarter 2019 compared to 4.16% for the fourth quarter 2018 and 3.97% for the third quarter 2019. Please refer to the non-GAAP reconciliation at the end of the release. 

Noninterest income for the fourth quarter 2019 was $3.4 million, an increase of $1.1 million, or 45.7%, compared to $2.3 million for the fourth quarter 2018 and increased $511 thousand, or 17.7%, compared to $2.9 million for the third quarter 2019.  Noninterest income for the fourth quarter 2019 included $613 thousand of gain on the sale of securities. 

Noninterest expense for the fourth quarter 2019 increased $385 thousand, or 1.3%, to $29.4 million from $29.0 million for the fourth quarter 2018 and decreased $578 thousand compared to the third quarter 2019.

In the fourth quarter 2019, Allegiance’s efficiency ratio was 62.20% compared to 62.88% for the third quarter 2019 and 60.30% for the fourth quarter 2018.  Fourth quarter 2019 annualized returns on average assets, average equity and average tangible equity were 1.13%, 7.81% and 11.96%, respectively, compared to 0.98%, 6.73% and 10.33%, respectively, for the third quarter 2019.  Annualized returns on average assets, average equity and average tangible equity for the fourth quarter 2018 were 1.12%, 7.49% and 11.66%, respectively. Return on average tangible equity is a non-GAAP measure. Please refer to the non-GAAP reconciliation at the end of the release. 

Year Ended December 31, 2019 Results

Net interest income before provision for loan losses for the year ended December 31, 2019 increased $51.0 million, or 39.6%, to $179.5 million from $128.6 million for the year ended December 31, 2018 primarily due to a $1.22 billion, or 40.2%, increase in average interest-earning assets over the prior year associated with the Post Oak acquisition.  The net interest margin on a tax equivalent basis decreased 5 basis points to 4.22% for the year ended December 31, 2019 from 4.27% for the year ended December 31, 2018. Core net interest margin on a tax equivalent basis for the year ended December 31, 2019 would have been 4.00%, compared to 4.17% for the year ended December 31, 2018. Please refer to the non-GAAP reconciliation at the end of the release. 

Noninterest income for the year ended December 31, 2019 was $13.4 million, an increase of $5.7 million, or 74.0%, compared to $7.7 million for the year ended December 31, 2018 due primarily to additional noninterest income resulting from the Post Oak acquisition along with the gain of $1.5 million on the sale of securities.

Noninterest expense for the year ended December 31, 2019 increased $33.8 million, or 39.0%, to $120.6 million from $86.8 million for the year ended December 31, 2018. The increase in noninterest expense over the year ended December 31, 2018 was primarily due to additional expenses associated with increased headcount and bank offices from the Post Oak acquisition.

Allegiance’s efficiency ratio decreased from 63.68% for the year ended December 31, 2018 to 62.99% for the year ended December 31, 2019. For the year ended December 31, 2019, returns on average assets, average equity and average tangible equity were 1.10%, 7.48% and 11.50%, respectively, compared to 1.11%, 9.02% and 11.20%, respectively, for the year ended December 31, 2018. Return on average tangible equity is a non-GAAP measure. Please refer to the non-GAAP reconciliation at the end of the release.

Financial Condition

Total assets at December 31, 2019 increased $86.8 million to $4.99 billion compared to $4.91 billion at September 30, 2019 and increased $337.4 million compared to $4.66 billion at December 31, 2018, primarily due to organic loan growth.

Total loans at December 31, 2019 increased $29.3 million, or 3.0% (annualized), to $3.92 billion compared to $3.89 billion at September 30, 2019 and increased $207.0 million, or 5.6%, compared to $3.71 billion at December 31, 2018, primarily due to organic loan growth. Core loans, which exclude the mortgage warehouse portfolio, increased $57.6 million, or 5.9% (annualized), to $3.91 billion at December 31, 2019 from $3.85 billion at September 30, 2019 and increased $247.0 million, or 6.7%, from $3.66 billion at December 31, 2018.

Deposits at December 31, 2019 increased $170.6 million, or 17.4% (annualized), to $4.07 billion compared to $3.90 billion at September 30, 2019 and increased $405.6 million, or 11.1%, compared to $3.66 billion at December 31, 2018.

Asset Quality

Nonperforming assets totaled $36.7 million, or 0.74% of total assets, at December 31, 2019, compared to $42.9 million, or 0.88%, of total assets, at September 30, 2019, and $33.6 million, or 0.72% of total assets, at December 31, 2018. The allowance for loan losses was 0.75% of total loans at December 31, 2019, 0.77% of total loans at September 30, 2019 and 0.71% of total loans at December 31, 2018.

The provision for loan losses for the fourth quarter 2019 was $933 thousand, or 0.10% (annualized) of average loans, compared to $2.6 million, or 0.27% (annualized) of average loans, for the third quarter 2019. The provision for loan losses for the year ended 2019 was $5.9 million, or 0.15% of average loans, compared to $4.2 million, or 0.16% of average loans, for the year ended 2018.

Fourth quarter 2019 net charge-offs were $1.3 million, or 0.13% (annualized) of average loans, compared to net charge-offs of $729 thousand, or 0.07% (annualized) of average loans, for the third quarter 2019 and $219 thousand, or 0.02% (annualized) of average loans, for the fourth quarter 2018. Net charge-offs for the year ended December 31, 2019 were $2.8 million, or 0.07% of average loans, compared to net charge-offs for the year ended December 31, 2018 of $1.6 million, or 0.06% of average loans.

Dividend

The Board of Directors of Allegiance declared its first cash dividend of $0.10 per share to be paid on March 16, 2020 to all shareholders of record as of February 28, 2020. The amount and timing of any future dividend payments to shareholders will be subject to the discretion of Allegiance’s Board of Directors.

GAAP Reconciliation of Non-GAAP Financial Measures

Allegiance’s management uses certain non-GAAP financial measures to evaluate its performance. Please refer to the GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures at the end of this earnings release for a reconciliation of these non-GAAP financial measures.

Conference Call

As previously announced, Allegiance’s management team will host a conference call on Wednesday, January 29, 2020 at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) to discuss its fourth quarter 2019 results. Individuals and investment professionals may participate in the call by dialing (877) 279-2520. The conference ID number is 4427269.  Alternatively, a simultaneous audio-only webcast may be accessed via the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under Upcoming Events. If you are unable to participate during the live webcast, the webcast will be archived on the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under News and Events, Event Calendar, Past Events.

Allegiance Bancshares, Inc.

As of December 31, 2019, Allegiance was a $4.99 billion asset Houston, Texas-based bank holding company. Through its wholly owned subsidiary, Allegiance Bank, Allegiance provides a diversified range of commercial banking services primarily to small to medium-sized businesses and individual customers in the Houston region. Allegiance’s super-community banking strategy was designed to foster strong customer relationships while benefiting from a platform and scale that is competitive with larger local and regional banks.  As of December 31, 2019, Allegiance Bank operated 27 full-service banking locations in the Houston region, which we define as the Houston-The Woodlands-Sugar Land and Beaumont-Port Arthur metropolitan statistical areas, with 26 bank offices and one loan production office in the Houston metropolitan area and one bank office location in Beaumont, just outside of the Houston metropolitan area. Visit www.allegiancebank.com for more information.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

This release may contain forward-looking statements within the meaning of the securities laws that are based on various facts and derived utilizing important assumptions, present expectations, estimates and projections about Allegiance and its subsidiaries. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “continues,” “anticipates,” “intends,” “projects,” “estimates,” “potential,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing words. Forward-looking statements include information concerning Allegiance’s future financial performance, business and growth strategy, projected plans and objectives, as well as projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of Allegiance’s control, which may cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include but are not limited to whether Allegiance can: continue to develop and maintain new and existing customer and community relationships; successfully implement its growth strategy, including identifying suitable acquisition targets and integrating the businesses of acquired companies and banks; sustain its current internal growth rate; provide quality and competitive products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its performance objectives. These and various other risk factors are discussed in Allegiance’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and in other reports and statements Allegiance has filed with the Securities and Exchange Commission. Copies of such filings are available for download free of charge from the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under Financial Information, SEC Filings.  Any forward-looking statement made by Allegiance in this release speaks only as of the date on which it is made. Factors or events that could cause Allegiance’s actual results to differ may emerge from time to time, and it is not possible for Allegiance to predict all of them. Allegiance undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Allegiance Bancshares, Inc.
8847 West Sam Houston Parkway N., Suite 200
Houston, Texas 77040
ir@allegiancebank.com  

Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

 2019  2018 
 December 31  September 30  June 30  March 31  December 31 
               
 (Dollars in thousands) 
Cash and cash equivalents$346,248  $300,619  $232,607  $258,843  $268,947 
Available for sale securities 372,545   353,000   348,173   345,716   337,293 
                    
Total loans 3,915,310   3,886,004   3,857,963   3,806,161   3,708,306 
Allowance for loan losses (29,438)  (29,808)  (27,940)  (27,123)  (26,331)
Loans, net 3,885,872   3,856,196   3,830,023   3,779,038   3,681,975 
                    
Goodwill 223,642   223,642   223,642   223,642   223,125 
Core deposit intangibles, net 21,876   23,053   24,231   25,409   26,587 
Premises and equipment, net 66,790   67,175   59,690   60,327   41,717 
Other real estate owned 8,337   8,333   6,294   1,152   630 
Bank owned life insurance 27,104   26,947   26,794   26,639   26,480 
Other assets 40,240   46,875   42,757   48,036   48,495 
Total assets$4,992,654  $4,905,840  $4,794,211  $4,768,802  $4,655,249 
                    
Noninterest-bearing deposits$1,252,232  $1,227,839  $1,173,423  $1,181,920  $1,209,300 
Interest-bearing deposits 2,815,869   2,669,646   2,687,217   2,598,141   2,453,236 
Total deposits 4,068,101   3,897,485   3,860,640   3,780,061   3,662,536 
                    
Borrowed funds 75,503   159,501   146,998   201,995   225,493 
Subordinated debt 107,799   107,771   49,019   48,959   48,899 
Other liabilities 31,386   34,775   32,853   34,010   15,337 
Total liabilities 4,282,789   4,199,532   4,089,510   4,065,025   3,952,265 
                    
Common stock 20,524   20,737   21,147   21,484   21,938 
Capital surplus 521,066   529,688   541,979   556,184   571,803 
Retained earnings 163,375   149,389   137,342   123,094   112,131 
Accumulated other comprehensive income (loss) 4,900   6,494   4,233   3,015   (2,888)
Total shareholders’ equity 709,865   706,308   704,701   703,777   702,984 
Total liabilities and equity$4,992,654  $4,905,840  $4,794,211  $4,768,802  $4,655,249 


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

 Three Months Ended  Years Ended 
 2019  2018  2019  2018 
 December 31  September 30  June 30  March 31  December 31  December 31  December 31 
                     
 (Dollars in thousands, except per share data) 
INTEREST INCOME:                           
Loans, including fees$55,368  $55,790  $56,016  $54,189  $53,272  $221,363  $148,223 
Securities:                           
Taxable 2,066   2,090   1,837   982   844   6,975   2,725 
Tax-exempt 469   483   692   1,290   1,445   2,934   5,802 
Deposits in other financial institutions 244   302   401   688   742   1,635   1,473 
Total interest income 58,147   58,665   58,946   57,149   56,303   232,907   158,223 
                            
INTEREST EXPENSE:                           
Demand, money market and savings deposits 5,091   4,975   4,513   3,728   3,367   18,307   6,478 
Certificates and other time deposits 6,483   6,909   7,008   6,256   5,358   26,656   15,478 
Borrowed funds 547   1,183   1,118   1,827   1,008   4,675   4,788 
Subordinated debt 1,500   761   736   735   732   3,732   2,900 
Total interest expense 13,621   13,828   13,375   12,546   10,465   53,370   29,644 
NET INTEREST INCOME 44,526   44,837   45,571   44,603   45,838   179,537   128,579 
Provision for loan losses 933   2,597   1,407   1,002   2,964   5,939   4,248 
Net interest income after provision for loan losses 43,593   42,240   44,164   43,601   42,874   173,598   124,331 
                            
NONINTEREST INCOME:                           
Nonsufficient funds fees 189   168   139   162   190   658   755 
Service charges on deposit accounts 403   379   365   325   363   1,472   869 
Gain on sale of securities 613      846         1,459    
(Loss) gain on sales of other real estate and repossessed assets (45)     70   1   (429)  26   (428)
Bank owned life insurance 157   153   155   159   163   624   579 
Rebate from correspondent bank 900   900   884   896   988   3,580   2,609 
Other 1,183   1,289   1,386   1,746   1,059   5,604   3,329 
Total noninterest income 3,400   2,889   3,845   3,289   2,334   13,423   7,713 
                            
NONINTEREST EXPENSE:                           
Salaries and employee benefits 18,273   20,221   19,415   19,684   18,167   77,593   56,704 
Net occupancy and equipment 1,994   1,973   2,114   2,098   1,959   8,179   5,845 
Depreciation 861   822   756   753   802   3,192   2,132 
Data processing and software amortization 2,120   2,058   1,709   1,577   1,485   7,464   5,120 
Professional fees 540   667   527   599   670   2,333   2,009 
Regulatory assessments and FDIC insurance 216   (41)  802   728   776   1,705   2,309 
Core deposit intangibles amortization 1,177   1,178   1,178   1,178   1,229   4,711   1,815 
Communications 486   455   468   430   416   1,839   1,185 
Advertising 597   449   617   704   704   2,367   1,725 
Acquisition and merger-related expenses       153   1,173   840   1,326   1,661 
Other 3,167   2,227   2,341   2,191   1,998   9,926   6,282 
Total noninterest expense 29,431   30,009   30,080   31,115   29,046   120,635   86,787 
INCOME BEFORE INCOME TAXES 17,562   15,120   17,929   15,775   16,162   66,386   45,257 
Provision for income taxes 3,576   3,073   3,681   3,097   2,999   13,427   7,948 
NET INCOME$13,986  $12,047  $14,248  $12,678  $13,163  $52,959  $37,309 
                            
EARNINGS PER SHARE                           
Basic$0.68  $0.57  $0.67  $0.58  $0.60  $2.50  $2.41 
Diluted$0.67  $0.57  $0.66  $0.58  $0.59  $2.47  $2.37 


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

 Three Months Ended  Years Ended 
 2019  2018  2019  2018 
 December 31  September 30  June 30  March 31  December 31  December 31  December 31 
                     
 (Dollars and share amounts in thousands, except per share data) 
Net income$13,986  $12,047  $14,248  $12,678  $13,163  $52,959  $37,309 
                            
Earnings per share, basic$0.68  $0.57  $0.67  $0.58  $0.60  $2.50  $2.41 
Earnings per share, diluted$0.67  $0.57  $0.66  $0.58  $0.59  $2.47  $2.37 
                            
Return on average assets(A) 1.13%  0.98%  1.19%  1.08%  1.12%  1.10%  1.11%
Return on average equity(A) 7.81%  6.73%  8.10%  7.27%  7.49%  7.48%  9.02%
Return on average tangible equity(A)(B) 11.96%  10.33%  12.52%  11.22%  11.66%  11.50%  11.20%
Net interest margin (tax equivalent)(C) 4.11%  4.16%  4.33%  4.31%  4.45%  4.22%  4.27%
Core net interest margin (tax equivalent)(B) 3.94%  3.97%  4.07%  4.03%  4.16%  4.00%  4.17%
Efficiency ratio(D) 62.20%  62.88%  61.93%  64.97%  60.30%  62.99%  63.68%
                            
Capital Ratios                           
Allegiance Bancshares, Inc. (Consolidated)                           
Equity to assets 14.22%  14.40%  14.70%  14.76%  15.10%  14.22%  15.10%
Tangible equity to tangible assets(B) 9.78%  9.86%  10.05%  10.06%  10.29%  9.78%  10.29%
Estimated common equity tier 1 capital 11.43%  11.28%  11.34%  11.37%  11.76%  11.43%  11.76%
Estimated tier 1 risk-based capital 11.67%  11.51%  11.58%  11.61%  12.01%  11.67%  12.01%
Estimated total risk-based capital 14.85%  14.70%  13.27%  13.28%  13.70%  14.85%  13.70%
Estimated tier 1 leverage capital 10.02%  10.06%  10.17%  10.25%  10.61%  10.02%  10.61%
Allegiance Bank                           
Estimated common equity tier 1 capital 12.68%  12.28%  12.02%  11.67%  11.83%  12.68%  11.83%
Estimated tier 1 risk-based capital 12.68%  12.28%  12.02%  11.67%  11.83%  12.68%  11.83%
Estimated total risk-based capital 14.40%  14.01%  13.71%  13.34%  13.53%  14.40%  13.53%
Estimated tier 1 leverage capital 10.90%  10.73%  10.57%  10.31%  10.45%  10.90%  10.45%
                            
Other Data                           
Weighted average shares:                           
Basic 20,652   20,981   21,257   21,733   21,908   21,152   15,485 
Diluted 20,930   21,256   21,546   22,040   22,210   21,424   15,773 
Period end shares outstanding 20,524   20,737   21,147   21,484   21,938   20,524   21,938 
Book value per share$34.59  $34.06  $33.32  $32.76  $32.04  $34.59  $32.04 
Tangible book value per share(B)$22.62  $22.16  $21.60  $21.17  $20.66  $22.62  $20.66 


(A)Interim periods annualized.
(B)Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures at the end of this Earnings Release.
(C)Net interest margin represents net interest income divided by average interest-earning assets.
(D)Represents total noninterest expense divided by the sum of net interest income plus noninterest income, excluding net gains and losses on the sale of loans, securities and assets. Additionally, taxes and provision for loan losses are not part of this calculation.


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

 Three Months Ended 
 December 31, 2019  September 30, 2019  December 31, 2018 
 Average Balance  Interest Earned/ Interest Paid  Average Yield/ Rate  Average Balance  Interest Earned/ Interest Paid  Average Yield/ Rate  Average Balance  Interest Earned/ Interest Paid  Average Yield/ Rate 
                           
 (Dollars in thousands) 
Assets                                   
Interest-Earning Assets:                                   
Loans$3,888,476  $55,368   5.65% $3,870,205  $55,790   5.72% $3,639,390  $53,272   5.81%
Securities 364,605   2,535   2.76%  359,392   2,573   2.84%  336,974   2,289   2.70%
Deposits in other financial
  institutions and other
 54,947   244   1.76%  55,070   302   2.17%  132,281   742   2.23%
Total interest-earning assets 4,308,028  $58,147   5.35%  4,284,667  $58,665   5.43%  4,108,645  $56,303   5.44%
Allowance for loan losses (29,997)          (28,593)          (23,554)        
Noninterest-earning assets 639,601           600,004           564,934         
Total assets$4,917,632          $4,856,078          $4,650,025         
                                    
Liabilities and
  Shareholders' Equity
                                   
Interest-Bearing Liabilities:                                   
Interest-bearing demand
  deposits
$361,666  $952   1.04% $332,652  $943   1.13% $325,046  $920   1.12%
Money market and savings
  deposits
 1,169,996   4,139   1.40%  1,099,937   4,032   1.45%  942,764   2,447   1.03%
Certificates and other time
  deposits
 1,203,110   6,483   2.14%  1,269,886   6,909   2.16%  1,232,666   5,358   1.72%
Borrowed funds 86,372   547   2.51%  158,358   1,183   2.96%  168,403   1,008   2.37%
Subordinated debt 107,782   1,500   5.52%  51,607   761   5.85%  48,865   732   5.94%
Total interest-bearing
  liabilities
 2,928,926  $13,621   1.85%  2,912,440  $13,828   1.88%  2,717,744  $10,465   1.53%
                                    
Noninterest-Bearing
  Liabilities:
                                   
Noninterest-bearing demand
  deposits
 1,237,770           1,198,564           1,215,589         
Other liabilities 40,781           35,030           19,389         
Total liabilities 4,207,477           4,146,034           3,952,722         
Shareholders' equity 710,155           710,044           697,303         
Total liabilities and
  shareholders' equity
$4,917,632          $4,856,078          $4,650,025         
                                    
Net interest rate spread         3.50%          3.55%          3.91%
                                    
Net interest income and margin    $44,526   4.10%     $44,837   4.15%     $45,838   4.43%
                                    
Net interest income and net
  interest margin (tax equivalent)
    $44,623   4.11%     $44,924   4.16%     $46,100   4.45%


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

 Years Ended December 31, 
 2019  2018 
 Average Balance  Interest Earned/ Interest Paid  Average Yield/ Rate  Average Balance  Interest Earned/ Interest Paid  Average Yield/ Rate 
                  
 (Dollars in thousands) 
Assets                       
Interest-Earning Assets:                       
Loans$3,831,894  $221,363   5.78% $2,652,355  $148,223   5.59%
Securities 355,233   9,909   2.79%  317,329   8,527   2.69%
Deposits in other financial institutions 74,655   1,635   2.19%  70,145   1,473   2.10%
Total interest-earning assets 4,261,782  $232,907   5.47%  3,039,829  $158,223   5.21%
Allowance for loan losses (28,129)          (24,077)        
Noninterest-earning assets 594,981           349,408         
Total assets$4,828,634          $3,365,160         
                        
Liabilities and Shareholders' Equity                       
Interest-Bearing Liabilities:                       
Interest-bearing demand deposits$345,693  $4,010   1.16% $224,210  $1,834   0.82%
Money market and savings deposits 1,037,126   14,297   1.38%  637,722   4,644   0.73%
Certificates and other time deposits 1,276,684   26,656   2.09%  940,356   15,478   1.65%
Borrowed funds 127,138   4,675   3.68%  240,952   4,788   1.99%
Subordinated debt 64,451   3,732   5.79%  48,776   2,900   5.95%
Total interest-bearing liabilities 2,851,092  $53,370   1.87%  2,092,016  $29,644   1.42%
                        
Noninterest-Bearing Liabilities:                       
Noninterest-bearing demand deposits 1,194,496           848,276         
Other liabilities 74,777           11,427         
Total liabilities 4,120,365           2,951,719         
Shareholders' equity 708,269           413,441         
Total liabilities and shareholders' equity$4,828,634          $3,365,160         
                        
Net interest rate spread         3.60%          3.79%
                        
Net interest income and margin    $179,537   4.21%     $128,579   4.23%
                        
Net interest income and net interest
  margin (tax equivalent)
    $180,036   4.22%     $129,652   4.27%


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

 Three Months Ended 
 2019  2018 
 December 31  September 30  June 30  March 31  December 31 
               
 (Dollars in thousands) 
Period-end Loan Portfolio:                   
Commercial and industrial$689,360  $675,055  $694,516  $699,471  $702,037 
Mortgage warehouse 8,304   36,594   46,171   36,742   48,274 
Real estate:                   
Commercial real estate (including multi-family residential) 1,873,782   1,859,721   1,830,764   1,771,890   1,650,912 
Commercial real estate construction and land development 410,471   386,723   368,108   396,162   430,128 
1-4 family residential (including home equity) 698,957   695,520   690,961   658,261   649,311 
Residential construction 192,515   189,608   183,991   201,314   186,411 
Consumer and other 41,921   42,783   43,452   42,321   41,233 
Total loans$3,915,310  $3,886,004  $3,857,963  $3,806,161  $3,708,306 
                    
Asset Quality:                   
Nonaccrual loans$28,371  $34,615  $31,382  $32,670  $32,953 
Accruing loans 90 or more days past due              
Total nonperforming loans 28,371   34,615   31,382   32,670   32,953 
Other real estate 8,337   8,333   6,294   1,152   630 
Other repossessed assets              
Total nonperforming assets$36,708  $42,948  $37,676  $33,822  $33,583 
                    
Net charge-offs$1,303  $729  $590  $210  $219 
                    
Nonaccrual loans:                   
Commercial and industrial$8,388  $8,033  $9,386  $11,221  $10,861 
Mortgage warehouse              
Real estate:                   
Commercial real estate (including multi-family residential) 6,741   15,356   18,218   17,531   17,776 
Commercial real estate construction and land development 9,050   9,050   1,541   818   974 
1-4 family residential (including home equity) 3,294   1,992   2,074   2,928   3,201 
Residential construction 746             
Consumer and other 152   184   163   172   141 
Total nonaccrual loans$28,371  $34,615  $31,382  $32,670  $32,953 
                    
Asset Quality Ratios:                   
Nonperforming assets to total assets 0.74%  0.88%  0.79%  0.71%  0.72%
Nonperforming loans to total loans 0.72%  0.89%  0.81%  0.86%  0.89%
Allowance for loan losses to nonperforming loans 103.76%  86.11%  89.03%  83.02%  79.90%
Allowance for loan losses to total loans 0.75%  0.77%  0.72%  0.71%  0.71%
Net charge-offs to average loans (annualized) 0.13%  0.07%  0.06%  0.02%  0.02%


Allegiance Bancshares, Inc.
GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures
(Unaudited)

Allegiance’s management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Allegiance believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and  that management and investors benefit from referring to these non-GAAP financial measures in assessing Allegiance’s performance and when planning, forecasting, analyzing and comparing past, present and future periods. Specifically, Allegiance reviews tangible book value per share, return on average tangible equity, the ratio of tangible equity to tangible assets and core net interest margin on a tax equivalent basis for internal planning and forecasting purposes. Allegiance has included in this Earnings Release information relating to these non-GAAP financial measures for the applicable periods presented.  These non-GAAP measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which Allegiance calculates the non-GAAP financial measures may differ from that of other companies reporting measures with similar names.

 Three Months Ended  Years Ended 
 2019  2018  2019  2018 
 December 31  September 30  June 30  March 31  December 31  December 31  December 31 
                     
 (Dollars and share amounts in thousands, except per share data) 
Total shareholders' equity$709,865  $706,308  $704,701  $703,777  $702,984  $709,865  $702,984 
Less:  Goodwill and core deposit intangibles, net 245,518   246,695   247,873   249,051   249,712   245,518   249,712 
Tangible shareholders’ equity$464,347  $459,613  $456,828  $454,726  $453,272  $464,347  $453,272 
                            
Shares outstanding at end of period 20,524   20,737   21,147   21,484   21,938   20,524   21,938 
                            
Tangible book value per share$22.62  $22.16  $21.60  $21.17  $20.66  $22.62  $20.66 
                            
Net income$13,986  $12,047  $14,248  $12,678  $13,163  $52,959  $37,309 
                            
Average shareholders' equity$710,155  $710,044  $705,162  $707,666  $697,303  $708,269  $413,441 
Less:  Average goodwill and core deposit intangibles, net 246,154   247,404   248,621   249,277   249,252   247,854   80,384 
Average tangible shareholders’ equity$464,001  $462,640  $456,541  $458,389  $448,051  $460,415  $333,057 
                            
Return on average tangible equity 11.96%  10.33%  12.52%  11.22%  11.66%  11.50%  11.20%
                            
Total assets$4,992,654  $4,905,840  $4,794,211  $4,768,802  $4,655,249  $4,992,654  $4,655,249 
Less: Goodwill and core deposit intangibles, net 245,518   246,695   247,873   249,051   249,712   245,518   249,712 
Tangible assets$4,747,136  $4,659,145  $4,546,338  $4,519,751  $4,405,537  $4,747,136  $4,405,537 
                            
Tangible equity to tangible assets 9.78%  9.86%  10.05%  10.06%  10.29%  9.78%  10.29%
                            
Net interest income (tax equivalent)$44,623  $44,924  $45,684  $44,805  $46,100  $180,036  $129,652 
Less: Acquisition accounting adjustments (1,860)  (2,045)  (2,755)  (2,965)  (3,069)  (9,625)  (3,069)
Core net interest income (tax equivalent)$42,763  $42,879  $42,929  $41,840  $43,031  $170,411  $126,583 
                            
Average earning assets$4,308,028  $4,284,667  $4,233,653  $4,212,669  $4,108,645  $4,261,782  $3,039,829 
                            
Net interest margin (tax equivalent) 4.11%  4.16%  4.33%  4.31%  4.45%  4.22%  4.27%
Core net interest margin (tax equivalent) 3.94%  3.97%  4.07%  4.03%  4.16%  4.00%  4.17%

Allegiance Bank - BancsharesOneLineHorizontalWithRegMark.jpg

Source: Allegiance Bancshares, Inc.

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