Investor Relations

Investor Relations

Press Release

Allegiance Bancshares, Inc. Reports Second Quarter 2020 Results

Company Release - 7/30/2020 7:00 AM ET
  • Record net interest income of $50.8 million, representing 12.9% growth from the first quarter of 2020
  • Funded over 5,800 loans totaling in excess of $695 million within the Small Business Administration Paycheck Protection Program under the Coronavirus Aid, Relief and Economic Security Act (CARES Act) through June 30, 2020
     
  • Net interest margin remained strong at 4.10% for the second quarter 2020
     
  • Declared quarterly dividend of $0.10 per share of common stock
     
  • Opened de novo branch in the historic East End of Houston on July 27, 2020

HOUSTON, July 30, 2020 (GLOBE NEWSWIRE) -- Allegiance Bancshares, Inc. (NASDAQ: ABTX) (Allegiance), the holding company of Allegiance Bank (the "Bank"), today reported net income of $9.9 million and diluted earnings per share of $0.48 for the second quarter 2020 compared to net income of $14.2 million and diluted earnings per share of $0.66 for the second quarter 2019.  Net income for the six months ended June 30, 2020 was $13.4 million, or $0.65 per diluted share, compared to $26.9 million, or $1.24 per diluted share, for the six months ended June 30, 2019.  The second quarter and six months ended June 30, 2020 results were primarily driven by the increased provision for loan losses in response to COVID-19-related uncertainties in the current economic environment partially offset by increased net interest income. 

"We are pleased with our second quarter 2020 earnings performance, especially in light of the impact of the coronavirus on our economy," said Steve Retzloff, Allegiance’s Chief Executive Officer. “Allegiance finished the quarter on a solid foundation of record pre-tax, pre-provision earnings, strong capital ratios, and a great liquidity position. We believe that we are well-positioned in light of today’s economic uncertainties and remain a strong resource for those we serve,” commented Retzloff.

“Our team of extraordinary bankers and small business lenders worked tirelessly around the clock to deploy the SBA’s Paycheck Protection Program ('PPP') to support our small business community. I am incredibly proud of the Bank’s ability to deliver on our commitment to help our customers - all while making many changes to how and where we all work. Allegiance reinforces the unique and valuable role a community bank offers to the businesses it serves as our bankers helped our customers and new borrowers secure funding for over 5,800 loans totaling over $695 million and will continue to do more until the PPP program expires. In turn, Allegiance collected a weighted average fee of 3.75% on the PPP loans to be recognized over the life of the loans.  Allegiance was committed to supporting its customers from the start of the process and will continue to be committed throughout the entire forgiveness journey,” continued Retzloff.

“As community bankers, we have a responsibility to support the health and welfare of our customers, communities and employees throughout this unprecedented time. Allegiance donated $150,000 and issued a $100,000 matching grant as well as committed volunteers to support the Houston Food Bank that will help provide one million meals across its Houston footprint. Small businesses are the mainstay of our business in the Houston region and we have been honored to serve their needs during this challenging economic environment. We continue to work diligently to build shareholder value by utilizing our strong capital position to support our customers and the communities we serve with outstanding customer service to keep Houston strong,” concluded Retzloff.

Second Quarter 2020 Results

Net interest income before the provision for loan losses in the second quarter 2020 increased $5.3 million, or 11.6%, to $50.8 million from $45.6 million for the second quarter 2019 and increased $5.8 million, or 12.9%, from $45.0 million in the first quarter 2020.  These increases were primarily due to changes in the volume and relative mix of the underlying assets and liabilities, the impact of PPP loans as well as lower costs on interest-bearing liabilities.  The net interest margin on a tax equivalent basis decreased 23 basis points to 4.10% for the second quarter 2020 from 4.33% for the second quarter 2019 and decreased 5 basis points from 4.15% for the first quarter 2020. Excluding the impact of acquisition accounting adjustments, adjusted net interest margin on a tax equivalent basis was 4.05% for the second quarter 2020 compared to 4.07% for the second quarter 2019 and 4.04% for the first quarter 2020. Adjusted net interest margin is a non-GAAP measure. Please refer to the non-GAAP reconciliation on page 11.

Noninterest income for the second quarter 2020 was $1.6 million, a decrease of $2.3 million, or 59.4%, compared to $3.8 million for the second quarter 2019 and a decrease of $1.2 million, or 42.7%, compared to $2.7 million for the first quarter 2020.  Noninterest income for the second quarter 2020, first quarter 2020 and second quarter 2019 included $93 thousand, $194 thousand and $846 thousand, respectively, of gains on the sale of securities. Second quarter 2020 noninterest income reflected lower transactional fee income, significantly lower correspondent bank rebates and included a loss on the sale of other real estate owned of $306 thousand.

Noninterest expense for the second quarter 2020 decreased $301 thousand, or 1.0%, to $29.8 million from $30.1 million for the second quarter 2019 and decreased $2.6 million, or 8.1%, compared to the first quarter 2020. Noninterest expense for the first quarter 2020 included $2.2 million of other real estate write-downs.

In the second quarter 2020, Allegiance’s efficiency ratio was 56.92% compared to 68.13% for the first quarter 2020 and 61.93% for the second quarter 2019.  Second quarter 2020 annualized returns on average assets, average equity and average tangible equity were 0.71%, 5.51% and 8.32%, respectively, compared to 0.29%, 1.98% and 3.02%, respectively, for the first quarter 2020.  Annualized returns on average assets, average equity and average tangible equity for the second quarter 2019 were 1.19%, 8.10% and 12.52%, respectively. Return on average tangible equity is a non-GAAP measure. Please refer to the non-GAAP reconciliation on page 11. 

Six Months Ended June 30, 2020 Results

Net interest income before provision for loan losses for the six months ended June 30, 2020 increased $5.7 million, or 6.3%, to $95.9 million from $90.2 million for the six months ended June 30, 2019 primarily due to a $481.4 million, or 11.4%, increase in average interest-earning assets over the prior year, the impact of PPP loans as well as lower costs related to interest-bearing liabilities. The net interest margin on a tax equivalent basis decreased 20 basis points to 4.12% for the six months ended June 30, 2020 from 4.32% for the six months ended June 30, 2019. Excluding the impact of acquisition accounting adjustments, the adjusted net interest margin for the six months ended June 30, 2020 was 4.04%, compared to 4.05% for the six months ended June 30, 2019. Adjusted net interest margin is a non-GAAP measure. Please refer to the non-GAAP reconciliation on page 11.

Noninterest income for the six months ended June 30, 2020 was $4.3 million, a decrease of $2.8 million, or 39.9%, compared to $7.1 million for the six months ended June 30, 2019 due primarily to significantly lower correspondent bank rebates and losses on the sales of other real estate owned of $375 thousand. Additionally, noninterest income for the first six months of 2020 and 2019 included $287 thousand and $846 thousand, respectively, of gains on the sale of securities. 

Noninterest expense for the six months ended June 30, 2020 increased $985 thousand, or 1.6%, to $62.2 million from $61.2 million for the six months ended June 30, 2019.  The increase in noninterest expense over the six months ended June 30, 2019 was primarily due to $2.2 million of other real estate write-downs during the first quarter of 2020 partially offset by the decrease in merger-related expenses incurred during the first six months of 2019.

Allegiance’s efficiency ratio decreased from 63.44% for the six months ended June 30, 2019 to 62.26% for the six months ended June 30, 2020. For the six months ended June 30, 2020, returns on average assets, average equity and average tangible equity were 0.51%, 3.76% and 5.70%, respectively, compared to 1.14%, 7.69% and 11.87%, respectively, for the six months ended June 30, 2019. Return on average tangible equity is a non-GAAP measure. Please refer to the non-GAAP reconciliation on page 11. 

Financial Condition

Total assets at June 30, 2020 increased $834.5 million, or 66.7% (annualized), to $5.84 billion compared to $5.00 billion at March 31, 2020 and increased $1.04 billion, or 21.7%, compared to $4.79 billion at June 30, 2019, primarily due to the origination of PPP loans and growth in the securities portfolio.

Total loans at June 30, 2020 increased $628.1 million, or 63.5% (annualized), to $4.58 billion compared to $3.96 billion at March 31, 2020 and increased $725.7 million, or 18.8%, compared to $3.86 billion at June 30, 2019, primarily due to the origination of $695.8 million of PPP loans and organic loan growth. Core loans, which exclude the mortgage warehouse portfolio and PPP loans, decreased $66.6 million, or 6.7% (annualized), to $3.89 billion at June 30, 2020 from $3.95 billion at March 31, 2020 and increased $76.1 million, or 2.0%, from $3.81 billion at June 30, 2019.

Deposits at June 30, 2020 increased $747.1 million, or 75.6% (annualized), to $4.70 billion compared to $3.95 billion at March 31, 2020 and increased $840.1 million, or 21.8%, compared to $3.86 billion at June 30, 2019.

Asset Quality

Nonperforming assets totaled $45.1 million, or 0.77% of total assets, at June 30, 2020, compared to $34.2 million, or 0.68% of total assets, at March 31, 2020, and $37.7 million, or 0.79% of total assets, at June 30, 2019. The allowance for loan losses was 1.04% of total loans at June 30, 2020, 0.95% of total loans at March 31, 2020 and 0.72% of total loans at June 30, 2019. Accounting Standards Update (ASU) 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (CECL), became effective for the Company on January 1, 2020. On March 27, 2020, the CARES Act included an option for entities to delay the implementation of CECL until the earlier of the termination date of the national emergency declaration by the President or December 31, 2020. Due to the uncertainty on the economy from COVID-19, the Company chose to delay its implementation of CECL and recorded its provision for loan losses under the incurred loss model that existed prior to CECL.

The provision for loan losses for the second quarter 2020 was $10.7 million, or 0.97% (annualized) of average loans, compared to $11.0 million, or 1.12% (annualized) of average loans, for the first quarter 2020 and $1.4 million, or 0.15% (annualized) of average loans for the second quarter 2019 primarily due to economic risks and uncertainties related to the COVID-19 pandemic. The increase in the Company’s provision for loan losses in the second quarter of 2020 compared to prior quarters reflects the uncertainty surrounding unemployment, the economic impact caused by COVID-19 and the economic effects related to the sustained lower crude oil prices.

Second quarter 2020 net charge-offs were $538 thousand, or 0.05% (annualized) of average loans, a decrease from net charge-offs of $2.9 million, or 0.30% (annualized) of average loans, for the first quarter 2020 and $590 thousand, or 0.06% (annualized) of average loans, for the second quarter 2019.  Net charge-offs for the six months ended June 30, 2020 were $3.5 million, or 0.17% (annualized) of average loans, compared to net charge-offs for the six months ended June 30, 2019 of $799 thousand, or 0.04% (annualized) of average loans.

The Company believes the largest risks within its loan portfolio are in the hotel, restaurant and bar and oil and gas portfolios. Loan balances in the hotel industry, excluding PPP loans, totaled $134.0 million, or 2.9% of total loans, at June 30, 2020, of which $7.1 million were on nonaccrual. At June 30, 2020, restaurant and bar industry loans, excluding PPP loans, totaled $111.3 million, or 2.4%, of total loans, of which $695 thousand were on nonaccrual. At June 30, 2020, the Company’s allowance for loan losses allocated to its hotel portfolio was 1.3% of total hotel loans and its restaurant and bar portfolio was 1.3% of total restaurant and bar loans. The oil and gas portfolio, excluding PPP loans, totaled $74.7 million, or 1.6%, of total loans at June 30, 2020, of which $788 thousand were on nonaccrual. At June 30, 2020, the allowance for loan losses allocated to the oil and gas loan portfolio was 2.1% of total oil and gas loans.

As of June 30, 2020, the Company executed 2,111 principal and interest deferrals on outstanding loan balances of $1.19 billion with associated accrued interest of $16.4 million to borrowers in connection with the COVID-19 relief provided by the CARES Act. Additionally, upon request and after meeting certain conditions, borrowers could be granted a second payment deferral subsequent to the first deferral. The Company processed second payment deferrals for 129 loans with outstanding loan balances of $100.1 million and associated accrued interest of $1.4 million through July 24, 2020. These deferrals were generally no more than 90 days in duration.

Dividend

On July 23, 2020, the Board of Directors of Allegiance declared a cash dividend of $0.10 per share to be paid on September 15, 2020 to all shareholders of record as of August 31, 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 on page 11 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 Thursday, July 30, 2020 at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) to discuss its second quarter 2020 results. Individuals and investment professionals may participate in the call by dialing (877) 279-2520. The conference ID number is 1791298.  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 June 30, 2020, Allegiance was a $5.84 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 June 30, 2020, 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 contains forward-looking statements within the meaning of the securities laws that are derived utilizing 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 expected 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. Additionally, the impact of the COVID-19 pandemic is rapidly evolving and its future effects on Allegiance are difficult to predict. These and various other risk factors are discussed in Allegiance’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 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. Because of these uncertainties, readers should not place undue reliance on any forward-looking statement. Allegiance disclaims any 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.
Financial Highlights
(Unaudited)

  2020  2019 
  June 30  March 31  December 31  September 30  June 30 
    
  (Dollars in thousands) 
ASSETS                    
Cash and due from banks $237,585  $156,700  $213,347  $246,312  $170,850 
Interest-bearing deposits at other financial
  institutions
  28,815   18,189   132,901   54,307   61,757 
Total cash and cash equivalents  266,400   174,889   346,248   300,619   232,607 
Available for sale securities, at fair value  618,751   508,250   372,545   353,000   348,173 
Loans held for investment  4,583,656   3,955,546   3,915,310   3,886,004   3,857,963 
Less: allowance for loan losses  (47,642)  (37,511)  (29,438)  (29,808)  (27,940)
Loans, net  4,536,014   3,918,035   3,885,872   3,856,196   3,830,023 
Accrued interest receivable  32,795   17,203   15,468   15,201   16,508 
Premises and equipment, net  67,229   66,798   66,790   67,175   59,690 
Other real estate owned  11,847   12,617   8,337   8,333   6,294 
Federal Home Loan Bank stock  14,844   12,798   6,242   14,138   8,866 
Bank owned life insurance  27,398   27,255   27,104   26,947   26,794 
Goodwill  223,642   223,642   223,642   223,642   223,642 
Core deposit intangibles, net  19,896   20,886   21,876   23,053   24,231 
Other assets  18,065   20,056   18,530   17,536   17,383 
Total assets $5,836,881  $5,002,429  $4,992,654  $4,905,840  $4,794,211 
LIABILITIES AND SHAREHOLDERS’
  EQUITY
                    
LIABILITIES:                    
Deposits:                    
Noninterest-bearing $1,754,128  $1,217,532  $1,252,232  $1,227,839  $1,173,423 
Interest-bearing                    
Demand  375,353   341,524   367,278   340,754   390,067 
Money market and savings  1,270,437   1,110,631   1,258,008   1,114,233   995,467 
Certificates and other time  1,300,793   1,283,887   1,190,583   1,214,659   1,301,683 
Total interest-bearing deposits  2,946,583   2,736,042   2,815,869   2,669,646   2,687,217 
Total deposits  4,700,711   3,953,574   4,068,101   3,897,485   3,860,640 
Accrued interest payable  3,293   3,821   4,326   4,915   3,531 
Borrowed funds  255,509   190,506   75,503   159,501   146,998 
Subordinated debt  108,061   107,930   107,799   107,771   49,019 
Other liabilities  33,164   40,005   27,060   29,860   29,322 
Total liabilities  5,100,738   4,295,836   4,282,789   4,199,532   4,089,510 
SHAREHOLDERS’ EQUITY:                    
Common stock  20,431   20,355   20,524   20,737   21,147 
Capital surplus  515,045   513,894   521,066   529,688   541,979 
Retained earnings  172,723   164,858   163,375   149,389   137,342 
Accumulated other comprehensive
  income
  27,944   7,486   4,900   6,494   4,233 
Total shareholders’ equity  736,143   706,593   709,865   706,308   704,701 
TOTAL LIABILITIES AND
  SHAREHOLDERS’ EQUITY
 $5,836,881  $5,002,429  $4,992,654  $4,905,840  $4,794,211 


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

  Three Months Ended  Year-to-Date 
  2020  2019  2020  2019 
  June 30  March 31  December 31  September 30  June 30  June 30  June 30 
    
  (Dollars in thousands, except per share data) 
INTEREST INCOME:                            
  Loans, including fees $56,421  $54,624  $55,368  $55,790  $56,016  $111,045  $110,205 
  Securities:                            
  Taxable  1,842   2,087   2,066   2,090   1,837   3,929   2,819 
  Tax-exempt  2,169   546   469   483   692   2,715   1,982 
  Deposits in other financial
   institutions
  20   195   244   302   401   215   1,089 
  Total interest income  60,452   57,452   58,147   58,665   58,946   117,904   116,095 
                             
INTEREST EXPENSE:                            
  Demand, money market and
    savings deposits
  1,729   4,364   5,091   4,975   4,513   6,093   8,241 
  Certificates and other time
    deposits
  5,845   6,084   6,483   6,909   7,008   11,929   13,264 
  Borrowed funds  562   506   547   1,183   1,118   1,068   2,945 
  Subordinated debt  1,469   1,473   1,500   761   736   2,942   1,471 
  Total interest expense  9,605   12,427   13,621   13,828   13,375   22,032   25,921 
NET INTEREST INCOME  50,847   45,025   44,526   44,837   45,571   95,872   90,174 
Provision for loan losses  10,669   10,990   933   2,597   1,407   21,659   2,409 
Net interest income after provision
  for loan losses
  40,178   34,035   43,593   42,240   44,164   74,213   87,765 
                             
NONINTEREST INCOME:                            
  Nonsufficient funds fees  60   169   189   168   139   229   301 
  Service charges on deposit
    accounts
  343   457   403   379   365   800   690 
  Gain on sale of securities  93   194   613      846   287   846 
  (Loss) gain on sales of other real
    estate and repossessed assets
  (306)  (69)  (45)     70   (375)  71 
  Bank owned life insurance  143   151   157   153   155   294   314 
  Rebate from correspondent bank  89   493   900   900   884   582   1,780 
  Other  1,140   1,330   1,183   1,289   1,386   2,470   3,132 
  Total noninterest income  1,562   2,725   3,400   2,889   3,845   4,287   7,134 
                             
NONINTEREST EXPENSE:                            
  Salaries and employee benefits  19,334   19,781   18,273   20,221   19,415   39,115   39,099 
  Net occupancy and equipment  1,926   1,907   1,994   1,973   2,114   3,833   4,166 
  Depreciation  885   866   861   822   756   1,751   1,509 
  Data processing and software
    amortization
  1,934   1,826   2,120   2,058   1,709   3,760   3,332 
  Professional fees  800   573   540   667   527   1,373   1,126 
  Regulatory assessments and
    FDIC insurance
  609   632   216   (41)  802   1,241   1,530 
  Core deposit intangibles
    amortization
  990   990   1,177   1,178   1,178   1,980   2,356 
  Communications  390   417   486   455   468   807   898 
  Advertising  370   521   597   449   617   891   1,321 
  Acquisition and merger-related
    expenses
              153      1,326 
  Other  2,541   4,888   3,167   2,227   2,341   7,429   4,532 
  Total noninterest expense  29,779   32,401   29,431   30,009   30,080   62,180   61,195 
INCOME BEFORE INCOME
  TAXES
  11,961   4,359   17,562   15,120   17,929   16,320   33,704 
  Provision for income taxes  2,054   843   3,576   3,073   3,681   2,897   6,778 
NET INCOME $9,907  $3,516  $13,986  $12,047  $14,248  $13,423  $26,926 
                             
EARNINGS PER SHARE                            
  Basic $0.49  $0.17  $0.68  $0.57  $0.67  $0.66  $1.25 
  Diluted $0.48  $0.17  $0.67  $0.57  $0.66  $0.65  $1.24 


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

  Three Months Ended  Year-to-Date 
  2020  2019  2020  2019 
  June 30  March 31  December 31  September 30  June 30  June 30  June 30 
    
  (Dollars and share amounts in thousands, except per share data) 
Net income $9,907  $3,516  $13,986  $12,047  $14,248  $13,423  $26,926 
                             
Earnings per share, basic $0.49  $0.17  $0.68  $0.57  $0.67  $0.66  $1.25 
Earnings per share, diluted $0.48  $0.17  $0.67  $0.57  $0.66  $0.65  $1.24 
                             
Return on average assets(A)  0.71%  0.29%  1.13%  0.98%  1.19%  0.51%  1.14%
Return on average equity(A)  5.51%  1.98%  7.81%  6.73%  8.10%  3.76%  7.69%
Return on average tangible
  equity(A)(B)
  8.32%  3.02%  11.96%  10.33%  12.52%  5.70%  11.87%
Net interest margin
  (tax equivalent)(C)
  4.10%  4.15%  4.11%  4.16%  4.33%  4.12%  4.32%
Adjusted net interest margin
  (tax equivalent)(B)
  4.05%  4.04%  3.94%  3.97%  4.07%  4.04%  4.05%
Efficiency ratio(D)  56.92%  68.13%  62.20%  62.88%  61.93%  62.26%  63.44%
                             
Capital Ratios                            
Allegiance Bancshares, Inc.
   (Consolidated)
                            
  Equity to assets  12.61%  14.12%  14.22%  14.40%  14.70%  12.61%  14.70%
  Tangible equity to tangible
   assets(B)
  8.81%  9.71%  9.78%  9.86%  10.05%  8.81%  10.05%
  Estimated common equity
   tier 1 capital
  11.36%  11.15%  11.42%  11.28%  11.34%  11.36%  11.34%
  Estimated tier 1 risk-based
   capital
  11.60%  11.38%  11.66%  11.51%  11.58%  11.60%  11.58%
  Estimated total risk-based
   capital
  15.17%  14.72%  14.83%  14.70%  13.27%  15.17%  13.27%
  Estimated tier 1 leverage
   capital
  8.83%  9.89%  10.02%  10.06%  10.17%  8.83%  10.17%
Allegiance Bank                            
  Estimated common equity
   tier 1 capital
  12.84%  12.58%  12.67%  12.28%  12.02%  12.84%  12.02%
  Estimated tier 1 risk-based
   capital
  12.84%  12.58%  12.67%  12.28%  12.02%  12.84%  12.02%
  Estimated total risk-based
   capital
  14.97%  14.48%  14.39%  14.01%  13.71%  14.97%  13.71%
  Estimated tier 1 leverage
   capital
  9.77%  10.94%  10.89%  10.73%  10.57%  9.77%  10.57%
                             
Other Data                            
Weighted average shares:                            
  Basic  20,414   20,411   20,652   20,981   21,257   20,413   21,494 
  Diluted  20,514   20,690   20,930   21,256   21,546   20,572   21,780 
Period end shares
  outstanding
  20,431   20,355   20,524   20,737   21,147   20,431   21,147 
Book value per share $36.03  $34.71  $34.59  $34.06  $33.32  $36.03  $33.32 
Tangible book value per
  share(B)
 $24.11  $22.70  $22.62  $22.16  $21.60  $24.11  $21.60 

(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 on page 11 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 
  June 30, 2020  March 31, 2020  June 30, 2019 
  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 $4,425,036  $56,421   5.13% $3,933,291  $54,624   5.59% $3,819,687  $56,016   5.88%
Securities  594,205   4,011   2.71%  388,721   2,633   2.72%  350,004   2,529   2.90%
Deposits in other financial
  institutions and other
  18,173   20   0.44%  50,711   195   1.55%  63,962   401   2.52%
Total interest-earning assets  5,037,414  $60,452   4.83%  4,372,723  $57,452   5.28%  4,233,653  $58,946   5.58%
Allowance for loan losses  (41,334)          (28,718)          (27,125)        
Noninterest-earning assets  637,608           602,778           586,435         
Total assets $5,633,688          $4,946,783          $4,792,963         
                                     
Liabilities and
  Shareholders' Equity
                                    
Interest-Bearing Liabilities:                                    
Interest-bearing demand
  deposits
 $353,252  $421   0.48% $363,326  $846   0.94% $350,147  $1,152   1.32%
Money market and savings
  deposits
  1,169,225   1,308   0.45%  1,168,541   3,518   1.21%  994,557   3,361   1.36%
Certificates and other time
  deposits
  1,302,743   5,845   1.80%  1,193,427   6,084   2.05%  1,331,955   7,008   2.11%
Borrowed funds  320,332   562   0.71%  140,999   506   1.44%  155,969   1,118   2.87%
Subordinated debt  107,998   1,469   5.47%  107,865   1,473   5.49%  48,986   736   6.03%
  Total interest-bearing
  liabilities
  3,253,550  $9,605   1.19%  2,974,158  $12,427   1.68%  2,881,614  $13,375   1.86%
                                     
Noninterest-Bearing
  Liabilities:
                                    
Noninterest-bearing demand
  deposits
  1,624,641           1,225,888           1,173,662         
Other liabilities  32,393           33,202           32,525         
  Total liabilities  4,910,584           4,233,248           4,087,801         
Shareholders' equity  723,104           713,535           705,162         
  Total liabilities and
   shareholders' equity
 $5,633,688          $4,946,783          $4,792,963         
                                     
Net interest rate spread          3.64%          3.60%          3.72%
                                     
Net interest income and margin     $50,847   4.06%     $45,025   4.14%     $45,571   4.32%
                                     
Net interest income and net
  interest margin (tax equivalent)
     $51,342   4.10%     $45,152   4.15%     $45,684   4.33%



Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

  Six Months Ended June 30, 
  2020  2019 
  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 $4,179,164  $111,045   5.34% $3,783,662  $110,205   5.87%
Securities  491,463   6,644   2.72%  348,354   4,801   2.78%
Deposits in other financial institutions  34,442   215   1.26%  91,628   1,089   2.40%
Total interest-earning assets  4,705,069  $117,904   5.04%  4,223,644  $116,095   5.54%
Allowance for loan losses  (35,026)          (26,944)        
Noninterest-earning assets  619,315           572,748         
Total assets $5,289,358          $4,769,448         
                         
Liabilities and Shareholders' Equity                        
Interest-Bearing Liabilities:                        
Interest-bearing demand deposits $358,289  $1,267   0.71% $344,203  $2,115   1.24%
Money market and savings deposits  1,168,883   4,826   0.83%  937,664   6,126   1.32%
Certificates and other time deposits  1,248,085   11,929   1.92%  1,317,536   13,264   2.03%
Borrowed funds  230,666   1,068   0.93%  219,415   2,945   2.71%
Subordinated debt  107,931   2,942   5.48%  48,956   1,471   6.06%
Total interest-bearing liabilities  3,113,854  $22,032   1.42%  2,867,774  $25,921   1.82%
                         
Noninterest-Bearing Liabilities:                        
Noninterest-bearing demand deposits  1,425,265           1,170,435         
Other liabilities  31,919           24,832         
Total liabilities  4,571,038           4,063,041         
Shareholders' equity  718,320           706,407         
Total liabilities and shareholders' equity $5,289,358          $4,769,448         
                         
Net interest rate spread          3.62%          3.72%
                         
Net interest income and margin     $95,872   4.10%     $90,174   4.31%
                         
Net interest income and net interest
  margin (tax equivalent)
     $96,493   4.12%     $90,489   4.32%


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)

  Three Months Ended 
  2020  2019 
  June 30  March 31  December 31  September 30  June 30 
    
  (Dollars in thousands) 
Period-end Loan Portfolio:                    
Commercial and industrial $651,430  $702,267  $689,360  $675,055  $694,516 
Mortgage warehouse     1,051   8,304   36,594   46,171 
Paycheck Protection Program (PPP)  695,772             
Real estate:                    
  Commercial real estate (including
    multi-family residential)
  1,956,116   1,951,080   1,873,782   1,859,721   1,830,764 
  Commercial real estate construction and
    land development
  386,865   378,987   410,471   386,723   368,108 
  1-4 family residential (including home equity)  703,513   704,212   698,957   695,520   690,961 
  Residential construction  171,656   177,025   192,515   189,608   183,991 
Consumer and other  18,304   40,924   41,921   42,783   43,452 
Total loans $4,583,656  $3,955,546  $3,915,310  $3,886,004  $3,857,963 
                     
Asset Quality:                    
Nonaccrual loans $33,223  $21,621  $28,371  $34,615  $31,382 
Accruing loans 90 or more days past due               
Total nonperforming loans  33,223   21,621   28,371   34,615   31,382 
Other real estate  11,847   12,617   8,337   8,333   6,294 
Other repossessed assets               
Total nonperforming assets $45,070  $34,238  $36,708  $42,948  $37,676 
                     
Net charge-offs $538  $2,917  $1,303  $729  $590 
                     
Nonaccrual loans:                    
Commercial and industrial $12,578  $8,669  $8,388  $8,033  $9,386 
Mortgage warehouse               
Real estate:                    
  Commercial real estate (including
    multi-family residential)
  16,127   7,024   6,741   15,356   18,218 
  Commercial real estate construction and
    land development
  53   1,958   9,050   9,050   1,541 
  1-4 family residential (including home equity)  3,434   2,845   3,294   1,992   2,074 
  Residential construction  898   982   746       
Consumer and other  133   143   152   184   163 
Total nonaccrual loans $33,223  $21,621  $28,371  $34,615  $31,382 
                     
Asset Quality Ratios:                    
Nonperforming assets to total assets  0.77%  0.68%  0.74%  0.88%  0.79%
Nonperforming loans to total loans  0.72%  0.55%  0.72%  0.89%  0.81%
Allowance for loan losses to nonperforming loans  143.40%  173.49%  103.76%  86.11%  89.03%
Allowance for loan losses to total loans  1.04%  0.95%  0.75%  0.77%  0.72%
Net charge-offs to average loans (annualized)  0.05%  0.30%  0.13%  0.07%  0.06%


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 adjusted 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  Year-to-Date 
 2020  2019  2020  2019 
 June 30  March 31  December 31  September 30  June 30  June 30  June 30 
   
 (Dollars and share amounts in thousands, except per share data) 
Total shareholders' equity$736,143  $706,593  $709,865  $706,308  $704,701  $736,143  $704,701 
Less:  Goodwill and core
  deposit intangibles, net
 243,538   244,528   245,518   246,695   247,873   243,538   247,873 
Tangible shareholders
  equity
$492,605  $462,065  $464,347  $459,613  $456,828  $492,605  $456,828 
                            
Shares outstanding at end of
  period
 20,431   20,355   20,524   20,737   21,147   20,431   21,147 
                            
Tangible book value per share$24.11  $22.70  $22.62  $22.16  $21.60  $24.11  $21.60 
                            
Net income$9,907  $3,516  $13,986  $12,047  $14,248  $13,423  $26,926 
                            
Average shareholders' equity$723,104  $713,535  $710,155  $710,044  $705,162  $718,320  $706,407 
Less: Average goodwill and
  core deposit intangibles, net
 244,010   245,007   246,154   247,404   248,621   244,508   248,947 
Average tangible
  shareholders’ equity
$479,094  $468,528  $464,001  $462,640  $456,541  $473,812  $457,460 
                            
Return on average
  tangible equity
 8.32%  3.02%  11.96%  10.33%  12.52%  5.70%  11.87%
                            
Total assets$5,836,881  $5,002,429  $4,992,654  $4,905,840  $4,794,211  $5,836,881  $4,794,211 
Less: Goodwill and core
  deposit intangibles, net
 243,538   244,528   245,518   246,695   247,873   243,538   247,873 
Tangible assets$5,593,343  $4,757,901  $4,747,136  $4,659,145  $4,546,338  $5,593,343  $4,546,338 
                            
Tangible equity to tangible
  assets
 8.81%  9.71%  9.78%  9.86%  10.05%  8.81%  10.05%
                            
Net interest income
  (tax equivalent)
$51,342  $45,152  $44,623  $44,924  $45,684  $96,493  $90,489 
Less: Acquisition accounting
  adjustments
 (669)  (1,259)  (1,860)  (2,045)  (2,755)  (1,928)  (5,720)
Adjusted net interest
  income (tax equivalent)
$50,673  $43,893  $42,763  $42,879  $42,929  $94,565  $84,768 
                            
Average earning assets$5,037,414  $4,372,723  $4,308,028  $4,284,667  $4,233,653  $4,705,069  $4,223,644 
                            
Net interest margin
  (tax equivalent)
 4.10%  4.15%  4.11%  4.16%  4.33%  4.12%  4.32%
Adjusted net interest margin
  (tax equivalent)
 4.05%  4.04%  3.94%  3.97%  4.07%  4.04%  4.05%


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

 


Allegiance Bank - BancsharesOneLineHorizontalWithRegMark.jpg

Source: Allegiance Bancshares, Inc.

Stay Connected

Enter your email address to receive Investor Relation updates in your inbox.

Stay Connected

Enter your email address to receive Investor Relation updates in your inbox.