LOUISVILLE, Ky., Jan. 24, 2024 (GLOBE NEWSWIRE) -- Stock Yards Bancorp, Inc. (NASDAQ: SYBT), parent company of Stock Yards Bank & Trust Company, with offices in Louisville, central, eastern and northern Kentucky, as well as the Indianapolis, Indiana and Cincinnati, Ohio metropolitan markets, today reported earnings of $23.9 million, or $0.82 per diluted share, for the fourth quarter ended December 31, 2023. This compares to net income of $29.8 million, or $1.01 per diluted share, for the fourth quarter of 2022. For the year ended December 31, 2023, the Company produced record net income of $107.7 million, and diluted earnings per share of $3.67. Strong loan growth across all markets and deposit growth contributed to solid fourth quarter and full year 2023 operating results.
(dollar amounts in thousands, except per share data) | 4Q23 | 3Q23 | 4Q22 | ||||||
Net income | $ | 23,944 | $ | 27,092 | $ | 29,817 | |||
Net income per share, diluted | 0.82 | 0.92 | 1.01 | ||||||
Net interest income | $ | 62,016 | $ | 61,315 | $ | 65,263 | |||
Provision for credit losses(1) | 6,046 | 2,775 | 3,375 | ||||||
Non-interest income | 24,417 | 22,896 | 23,142 | ||||||
Non-interest expenses | 50,013 | 46,702 | 45,946 | ||||||
Net interest margin | 3.25 | % | 3.34 | % | 3.64 | % | |||
Efficiency ratio(2) | 57.80 | % | 55.38 | % | 51.85 | % | |||
Tangible common equity to tangible assets(3) | 8.09 | % | 7.69 | % | 7.44 | % | |||
Annualized return on average assets(4) | 1.17 | % | 1.38 | % | 1.56 | % | |||
Annualized return on average equity(4) | 11.62 | % | 13.26 | % | 15.99 | % | |||
“I am pleased with our fourth quarter and record full year 2023 results, highlighted by strong loan production and fee income led by Wealth Management & Trust (WM&T). We continue to see broad-based loan demand from our customers throughout our markets. Total loans, excluding PPP loans, increased $580 million, or 11%, over the last 12 months, of which $155 million was generated during the fourth quarter, setting a record for the best fourth quarter of organic loan expansion in the Company’s history. Thanks to the dedication and commitment of our employees, our net income surpassed the $100 million mark for the first time in 2023,” commented James A. (Ja) Hillebrand, Chairman and Chief Executive Officer.
“Net interest income increased for the second consecutive linked quarter, due to loan growth and continued yield expansion from assets re-pricing. However, our net interest margin contracted over the linked quarter, as the increase in cost of funds continued to outpace the growth in yields on earning assets. We anticipate net interest margin compression will most likely persist into the first part of the year,” Hillebrand continued. “Deposit balances expanded nicely during the fourth quarter, increasing $268 million, or 4%, on the linked quarter and increasing $279 million, or 4%, over the last 12 months. We continue to focus on organic growth, while avoiding brokered deposits, which provide more expensive funding than in-market deposit relationships.”
“Non-interest income, led by fourth quarter gains in several categories, once again fueled our operating results. WM&T posted another record year, benefiting from strong equity and fixed income market performance, coupled with net new business growth. Robust card income, treasury management and brokerage fees, driven by increased demand and customer expansion, served to cap off a record fee income year for us. We look forward to carrying this momentum into 2024 – our 120th year of operation – with an unwavering focus on cultivating full customer relationships,” said Hillebrand.
At December 31, 2023, the Company had $8.17 billion in assets, $5.77 billion in loans and $6.67 billion in total deposits. The Company’s combined enterprise, which encompasses 71 branch offices across three contiguous states, will continue to benefit from a diversified geographic footprint that provides significant growth opportunities in both the banking and WM&T arenas.
Key factors contributing to the fourth quarter of 2023 results included:
Highlights for the year ended December 31, 2023:
Hillebrand concluded, “In January, Stock Yards was named to Stephen’s 2024 Bank Industry & Top Picks List as the top Small-Cap stock with upside price potential. We were also named to Stephen’s 2024 Best Ideas List, as the top company within the Midwest Bank category. In November, we were once again nationally recognized by American Banker Magazine as one of the Best Banks to Work for in 2023. The Best Banks to Work For program identifies and honors U.S. banks for outstanding employee satisfaction. In addition, in May, we were named a winner of the 2022 Raymond James Community Bankers Cup, which recognizes the top 10% of community banks with assets between $500 million and $10 billion based on various profitability, operational efficiency and balance sheet metrics, marking our 8th time being named to the Raymond James Community Bankers Cup. These recognitions are a testament to the dedication of our employees, who continue to work diligently to support our customers. We will not rest on our laurels as we enter 2024 – our 120th year of service to the communities we are honored to serve.”
Results of Operations – Fourth Quarter 2023 Compared with Fourth Quarter 2022
Net interest income, the Company’s largest source of revenue, decreased by $3.2 million, or 5%, to $62.0 million. While strong organic loan growth boosted net interest income over the past 12 months, the cost of interest bearing liabilities more than offset the increase in total interest income.
The Bank recorded $5.8 million in credit loss expense for loans during the fourth quarter of 2023. In addition to strong loan growth, a flat unemployment projection and other factors within the CECL allowance model, the Bank recorded $4.7 million in charge-offs, with $4.1 million attributed to one C&I relationship offset by $235,000 in total recoveries. The Bank also recorded a $275,000 expense for off balance sheet exposures associated with expansion of Construction & Land Development (C&LD) and C&I lines of credit (increased availability and utilization). For the fourth quarter of 2022, consistent with strong loan growth and deterioration within the future unemployment rate forecast, the Company recorded $3.6 million in provision for credit losses on loans and a $225,000 benefit to credit loss expense for off balance sheet exposures. In addition, the Bank recorded a $1.6 million specific reserve for a Commercial Real Estate loan during the fourth quarter of 2022.
Non-interest income increased $1.3 million, or 6%, to $24.4 million.
Non-interest expenses increased $4.1 million, or 9%, compared to the fourth quarter of 2022, to $50.0 million.
Financial Condition – December 31, 2023 Compared with December 31, 2022
Total assets increased $674 million, or 9%, year over year to $8.17 billion.
Total loans (excluding PPP) increased $580 million, or 11%, to $5.77 billion, with the largest sources of growth stemming from the commercial real estate and residential real estate portfolios. In addition to the strong growth, the Company has benefitted from the higher rate environment in 2023 that has generally slowed loan payoff activity. Total line of credit usage was 39.2% as of December 31, 2023, compared to 42.3% as of December 31, 2022, driven by strong production. C&I line of credit usage was 28.6% as of December 31, 2023, compared to 33.1% as of December 31, 2022.
Total investment securities, which spiked during the second quarter of 2021 and the first quarter of 2022 in part due to acquisitions, decreased $147 million, or 9%, year over year. Maturities/pay-downs of lower yielding investments have boosted the overall portfolio yield to 2.05% for the fourth quarter of 2023, from 1.96% in the fourth quarter of 2022. In 2023, cash flows from the investment portfolio have been utilized to fund loan growth and provide liquidity in lieu of redeployment.
Total deposits increased $279 million, or 4%, over the past 12 months, led by interest bearing demand and time deposit expansion which was partially offset by a decline in non-interest bearing demand deposits.
During the fourth quarter of 2023, the Company recorded net loan charge-offs of $4.5 million, with $4.1 million attributed to one C&I relationship. This compares to $152,000 in net charge offs during the fourth quarter of 2022. Non-performing loans(5) totaled $19 million, or 0.33% of total loans outstanding at December 31, 2023, compared to $15 million, or 0.29% of total loans outstanding at December 31, 2022. The ratio of allowance for credit losses to loans (5) ended at 1.38% at December 31, 2023 compared to 1.41% at December 31, 2022.
At December 31, 2023, the Company continued to be “well-capitalized,” the highest regulatory capital rating for financial institutions, with all capital ratios remaining strong. Total equity to assets(3) was 10.50% and the tangible common equity ratio(3) was 8.09% at December 31, 2023, compared to 10.14% and 7.44% at December 31, 2022, respectively. Interest rate volatility over the last 12 months has significantly impacted unrealized losses within the available for sale debt securities portfolio.
In November 2023, the board of directors declared a quarterly cash dividend of $0.30 per common share. The dividend was paid December 29, 2023 to shareholders of record as of December 18, 2023.
No shares have been purchased since 2020, and approximately 741,000 shares remain eligible for repurchase under the current buy-back plan, which expires in May 2025.
Results of Operations – Fourth Quarter 2023 Compared with Third Quarter 2023
Net interest margin declined 9 basis points on the linked quarter to 3.25%, as cost of funds growth continued to outpace earning asset yield growth.
Net interest income expanded $701,000, or 1%, over the prior quarter to $62.1 million, as management is optimistic that net interest margin contraction is starting to slow.
The Company recorded $6.0 million in provision for credit losses(1) during the fourth quarter of 2023, which included a $5.8 million provision for credit losses on loans and $275,000 of credit loss expense for off-balance sheet exposures. During the third quarter of 2023, the Company recorded $2.8 million in provision for credit losses, which included a $2.3 million provision for credit losses on loans and $475,000 of credit loss expense for off-balance sheet exposures.
Non-interest income increased $1.5 million, or 7% on the linked quarter, led by record card income, strong swap and letter of credit fees, OREO activity and the sale of Visa Class B stock.
Non-interest expenses increased $3.3 million, or 7%, to $50.0 million, as increased compensation, net occupancy expense, technology expense and consulting expenses more than off-set a decline in employee benefits.
Financial Condition – December 31, 2023 Compared with September 30, 2023
Total assets increased $267 million, or 3%, on the linked quarter to $8.17 billion.
Total loans expanded $154 million, or 3%, on the linked quarter, led by increases in nearly every category, with the C&I and C&LD loan portfolios leading the growth. Total line of credit usage was 39.2% as of December 31, 2023, compared to 38.8% as of September 30, 2023, driven by strong production. C&I line of credit usage was 28.6% as of December 31, 2023, compared to 26.8% as of September 30, 2023.
Total deposits increased $268 million, or 4%, on the linked quarter. Total interest bearing deposits increased $434 million, on the linked quarter, as increases in interest bearing demand, money market accounts and time deposits more than offset the $166 million contraction in non-interest bearing demand. Excluding public funds, total deposits increased $121 million on the linked quarter.
About the Company
Louisville, Kentucky-based Stock Yards Bancorp, Inc., with $8.17 billion in assets, was incorporated in 1988 as a bank holding company. It is the parent company of Stock Yards Bank & Trust Company, which was established in 1904. The Company’s common shares trade on The NASDAQ Stock Market under the symbol “SYBT.”
This report contains forward-looking statements under the Private Securities Litigation Reform Act that involve risks and uncertainties. Although the Company’s management believes the assumptions underlying the forward-looking statements contained herein are reasonable, any of these assumptions could be inaccurate. Therefore, there can be no assurance the forward-looking statements included herein will prove to be accurate. Factors that could cause actual results to differ from those discussed in forward-looking statements include, but are not limited to: economic conditions both generally and more specifically in the markets in which the Company and its banking subsidiary operates; competition for the Company’s customers from other providers of financial services; changes in, or forecasts of, future political and economic conditions, inflation and efforts to control it; government legislation and regulation, which change and over which the Company has no control; changes in interest rates; material unforeseen changes in liquidity, results of operations, or financial condition of the Company’s customers; and other risks detailed in the Company’s filings with the Securities and Exchange Commission, all of which are difficult to predict and many of which are beyond the control of the Company. Refer to Stock Yards’ Annual Report on Form 10-K for the year ended December 31, 2022, as well as its other filings with the SEC for a more detailed discussion of risks, uncertainties and factors that could cause actual results to differ from those discussed in the forward-looking statements.
Contact: T. Clay Stinnett
Executive Vice President,
Treasurer and Chief Financial Officer
(502) 625-0890
Stock Yards Bancorp, Inc. Financial Information (unaudited) | ||||||||||||||||
Fourth Quarter 2023 Earnings Release | ||||||||||||||||
(In thousands unless otherwise noted) | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
Income Statement Data | 2023 | 2022 | 2023 | 2022 | ||||||||||||
Net interest income, fully tax equivalent (6) | $ | 62,112 | $ | 65,469 | $ | 247,869 | $ | 234,267 | ||||||||
Interest income: | ||||||||||||||||
Loans | $ | 82,715 | $ | 64,033 | $ | 302,044 | $ | 216,138 | ||||||||
Federal funds sold and interest bearing due from banks | 3,526 | 2,173 | 8,411 | 6,018 | ||||||||||||
Mortgage loans held for sale | 38 | 13 | 211 | 190 | ||||||||||||
Investment securities and FHLB stock | 8,962 | 8,931 | 36,030 | 29,306 | ||||||||||||
Total interest income | 95,241 | 75,150 | 346,696 | 251,652 | ||||||||||||
Interest expense: | ||||||||||||||||
Deposits | 29,645 | 9,022 | 81,585 | 16,412 | ||||||||||||
Securities sold under agreements to repurchase and | ||||||||||||||||
other short-term borrowings | 843 | 399 | 2,776 | 721 | ||||||||||||
Federal Home Loan Bank advances | 2,155 | 12 | 12,768 | 12 | ||||||||||||
Subordinated debentures | 582 | 454 | 2,235 | 1,124 | ||||||||||||
Total interest expense | 33,225 | 9,887 | 99,364 | 18,269 | ||||||||||||
Net interest income | 62,016 | 65,263 | 247,332 | 233,383 | ||||||||||||
Provision for credit losses (1) | 6,046 | 3,375 | 13,796 | 10,257 | ||||||||||||
Net interest income after provision for credit losses | 55,970 | 61,888 | 233,536 | 223,126 | ||||||||||||
Non-interest income: | ||||||||||||||||
Wealth management and trust services | 10,099 | 9,221 | 39,802 | 36,111 | ||||||||||||
Deposit service charges | 2,244 | 2,183 | 8,866 | 8,286 | ||||||||||||
Debit and credit card income | 5,374 | 5,046 | 19,438 | 18,623 | ||||||||||||
Treasury management fees | 2,531 | 2,278 | 10,033 | 8,590 | ||||||||||||
Mortgage banking income | 823 | 209 | 3,705 | 3,210 | ||||||||||||
Loss on sale of securities | (44) | - | (44) | - | ||||||||||||
Net investment product sales commissions and fees | 860 | 833 | 3,205 | 3,063 | ||||||||||||
Bank owned life insurance | 576 | 545 | 2,253 | 1,597 | ||||||||||||
Gain (Loss) on sale of premises and equipment | (105) | 1,295 | (30) | 4,341 | ||||||||||||
Other | 2,059 | 1,532 | 4,992 | 5,328 | ||||||||||||
Total non-interest income | 24,417 | 23,142 | 92,220 | 89,149 | ||||||||||||
Non-interest expenses: | ||||||||||||||||
Compensation | 24,494 | 23,398 | 91,876 | 86,640 | ||||||||||||
Employee benefits | 3,829 | 3,421 | 18,451 | 16,568 | ||||||||||||
Net occupancy and equipment | 5,150 | 3,843 | 16,384 | 14,298 | ||||||||||||
Technology and communication | 4,612 | 3,747 | 17,318 | 14,897 | ||||||||||||
Debit and credit card processing | 1,719 | 1,470 | 6,481 | 5,909 | ||||||||||||
Marketing and business development | 1,754 | 1,544 | 5,990 | 5,005 | ||||||||||||
Postage, printing and supplies | 903 | 893 | 3,604 | 3,354 | ||||||||||||
Legal and professional | 1,293 | 492 | 3,958 | 2,943 | ||||||||||||
FDIC Insurance | 1,060 | 730 | 3,911 | 2,758 | ||||||||||||
Amortization of investments in tax credit partnerships | 324 | 88 | 1,294 | 353 | ||||||||||||
Capital and deposit based taxes | 601 | 799 | 2,476 | 2,621 | ||||||||||||
Merger expenses | - | - | - | 19,500 | ||||||||||||
Intangible amortization | 1,167 | 1,610 | 4,686 | 5,544 | ||||||||||||
Loss on disposition of LFA | - | 870 | - | 870 | ||||||||||||
Other | 3,107 | 3,041 | 11,400 | 10,531 | ||||||||||||
Total non-interest expenses | 50,013 | 45,946 | 187,829 | 191,791 | ||||||||||||
Income before income tax expense | 30,374 | 39,084 | 137,927 | 120,484 | ||||||||||||
Income tax expense | 6,430 | 9,174 | 30,179 | 27,190 | ||||||||||||
Net income | 23,944 | 29,910 | 107,748 | 93,294 | ||||||||||||
Less: net income attributed to non-controlling interest | - | 93 | - | 322 | ||||||||||||
Net income available to stockholders | $ | 23,944 | $ | 29,817 | $ | 107,748 | $ | 92,972 | ||||||||
Net income per share - Basic | $ | 0.82 | $ | 1.02 | $ | 3.69 | $ | 3.24 | ||||||||
Net income per share - Diluted | 0.82 | 1.01 | 3.67 | 3.21 | ||||||||||||
Cash dividend declared per share | 0.30 | 0.29 | 1.18 | 1.14 | ||||||||||||
Weighted average shares - Basic | 29,226 | 29,157 | 29,212 | 28,672 | ||||||||||||
Weighted average shares - Diluted | 29,331 | 29,428 | 23,343 | 28,922 | ||||||||||||
December 31, | ||||||||||||||||
Balance Sheet Data | 2023 | 2022 | ||||||||||||||
Investment securities | $ | 1,471,016 | $ | 1,617,834 | ||||||||||||
Loans | 5,771,038 | 5,205,918 | ||||||||||||||
Allowance for credit losses on loans | 79,374 | 73,531 | ||||||||||||||
Total assets | 8,170,102 | 7,496,261 | ||||||||||||||
Non-interest bearing deposits | 1,548,624 | 1,950,198 | ||||||||||||||
Interest bearing deposits | 5,122,124 | 4,441,054 | ||||||||||||||
Federal Home Loan Bank advances | 200,000 | 50,000 | ||||||||||||||
Stockholders' equity | 858,103 | 760,432 | ||||||||||||||
Total shares outstanding | 29,329 | 29,259 | ||||||||||||||
Book value per share (3) | $ | 29.26 | $ | 25.99 | ||||||||||||
Tangible common equity per share (3) | 21.95 | 18.50 | ||||||||||||||
Market value per share | 51.49 | 64.98 | ||||||||||||||
Stock Yards Bancorp, Inc. Financial Information (unaudited) | ||||||||||||||||
Fourth Quarter 2023 Earnings Release | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
Average Balance Sheet Data | 2023 | 2022 | 2023 | 2022 | ||||||||||||
Federal funds sold and interest bearing due from banks | $ | 258,950 | $ | 235,448 | $ | 164,314 | $ | 477,341 | ||||||||
Mortgage loans held for sale | 5,305 | 6,735 | 6,822 | 8,835 | ||||||||||||
Investment securities | 1,618,799 | 1,786,383 | 1,687,639 | 1,670,324 | ||||||||||||
Federal Home Loan Bank stock | 20,519 | 10,928 | 22,123 | 11,741 | ||||||||||||
Loans | 5,676,193 | 5,094,356 | 5,422,865 | 4,819,124 | ||||||||||||
Total interest earning assets | 7,579,766 | 7,133,850 | 7,303,763 | 6,987,365 | ||||||||||||
Total assets | 8,116,569 | 7,559,260 | 7,775,574 | 7,438,880 | ||||||||||||
Non-interest bearing deposits | 1,663,962 | 2,097,858 | 1,763,157 | 2,053,213 | ||||||||||||
Interest bearing deposits | 5,025,240 | 4,428,582 | 4,608,575 | 4,385,393 | ||||||||||||
Total deposits | 6,689,202 | 6,526,440 | 6,371,732 | 6,438,606 | ||||||||||||
Securities sold under agreement to repurchase | 130,148 | 117,138 | 123,111 | 122,154 | ||||||||||||
Federal Home Loan Bank advances | 205,435 | 1,087 | 280,068 | 274 | ||||||||||||
Subordinated debentures | 26,706 | 26,309 | 26,558 | 21,733 | ||||||||||||
Total interest bearing liabilities | 5,401,135 | 4,582,005 | 5,052,106 | 4,538,911 | ||||||||||||
Total stockholders' equity | 817,682 | 740,007 | 801,593 | 738,798 | ||||||||||||
Performance Ratios | ||||||||||||||||
Annualized return on average assets (4) | 1.17% | 1.56% | 1.39% | 1.25% | ||||||||||||
Annualized return on average equity (4) | 11.62% | 15.99% | 13.44% | 12.58% | ||||||||||||
Net interest margin, fully tax equivalent | 3.25% | 3.64% | 3.39% | 3.35% | ||||||||||||
Non-interest income to total revenue, fully tax equivalent | 28.22% | 26.12% | 27.12% | 27.56% | ||||||||||||
Efficiency ratio, fully tax equivalent (2) | 57.80% | 51.85% | 55.23% | 59.30% | ||||||||||||
Capital Ratios | ||||||||||||||||
Total stockholders' equity to total assets (3) | 10.50% | 10.14% | ||||||||||||||
Tangible common equity to tangible assets (3) | 8.09% | 7.44% | ||||||||||||||
Average stockholders' equity to average assets | 10.31% | 9.93% | ||||||||||||||
Total risk-based capital | 12.43% | 12.54% | ||||||||||||||
Common equity tier 1 risk-based capital | 11.04% | 11.04% | ||||||||||||||
Tier 1 risk-based capital | 11.43% | 11.47% | ||||||||||||||
Leverage | 9.62% | 9.33% | ||||||||||||||
Loan Segmentation | ||||||||||||||||
Commercial real estate - non-owner occupied | $ | 1,561,689 | $ | 1,443,813 | ||||||||||||
Commercial real estate - owner occupied | 907,424 | 788,936 | ||||||||||||||
Commercial and industrial | 1,302,809 | 1,230,976 | ||||||||||||||
Commercial and industrial - PPP | 4,319 | 18,593 | ||||||||||||||
Residential real estate - owner occupied | 708,893 | 591,515 | ||||||||||||||
Residential real estate - non-owner occupied | 358,715 | 312,474 | ||||||||||||||
Construction and land development | 531,324 | 445,690 | ||||||||||||||
Home equity lines of credit | 211,390 | 200,725 | ||||||||||||||
Consumer | 145,340 | 139,461 | ||||||||||||||
Leases | 15,503 | 13,322 | ||||||||||||||
Credit cards | 23,632 | 20,413 | ||||||||||||||
Total loans and leases | $ | 5,771,038 | $ | 5,205,918 | ||||||||||||
Asset Quality Data | ||||||||||||||||
Non-accrual loans | $ | 19,058 | $ | 14,242 | ||||||||||||
Troubled debt restructurings | - | - | ||||||||||||||
Loans past due 90 days or more and still accruing | 110 | 892 | ||||||||||||||
Total non-performing loans | 19,168 | 15,134 | ||||||||||||||
Other real estate owned | 10 | 677 | ||||||||||||||
Total non-performing assets | $ | 19,178 | $ | 15,811 | ||||||||||||
Non-performing loans to total loans (5) | 0.33% | 0.29% | ||||||||||||||
Non-performing assets to total assets | 0.23% | 0.21% | ||||||||||||||
Allowance for credit losses on loans to total loans (5) | 1.38% | 1.41% | ||||||||||||||
Allowance for credit losses on loans to average loans | 1.46% | 1.53% | ||||||||||||||
Allowance for credit losses on loans to non-performing loans | 414% | 486% | ||||||||||||||
Net (charge-offs) recoveries | $ | (4,472) | $ | (152) | $ | (6,628) | $ | 1 | ||||||||
Net (charge-offs) recoveries to average loans (7) | -0.08% | 0.00% | -0.12% | 0.00% | ||||||||||||
Stock Yards Bancorp, Inc. Financial Information (unaudited) | ||||||||||||||||
Fourth Quarter 2023 Earnings Release | ||||||||||||||||
Quarterly Comparison | ||||||||||||||||
Income Statement Data | 12/31/23 | 9/30/23 | 6/30/23 | 3/31/23 | 12/31/22 | |||||||||||
Net interest income, fully tax equivalent (6) | $ | 62,112 | $ | 61,437 | $ | 61,074 | $ | 63,245 | $ | 65,469 | ||||||
Net interest income | $ | 62,016 | $ | 61,315 | $ | 60,929 | $ | 63,072 | $ | 65,263 | ||||||
Provision for credit losses (1) | 6,046 | 2,775 | 2,350 | 2,625 | 3,375 | |||||||||||
Net interest income after provision for credit losses | 55,970 | 58,540 | 58,579 | 60,447 | 61,888 | |||||||||||
Non-interest income: | ||||||||||||||||
Wealth management and trust services | 10,099 | 10,030 | 10,146 | 9,527 | 9,221 | |||||||||||
Deposit service charges | 2,244 | 2,272 | 2,201 | 2,149 | 2,183 | |||||||||||
Debit and credit card income | 5,374 | 4,870 | 4,712 | 4,482 | 5,046 | |||||||||||
Treasury management fees | 2,531 | 2,635 | 2,549 | 2,318 | 2,278 | |||||||||||
Mortgage banking income | 823 | 814 | 1,030 | 1,038 | 209 | |||||||||||
Loss on sale of securities | (44) | - | - | - | - | |||||||||||
Net investment product sales commissions and fees | 860 | 791 | 800 | 754 | 833 | |||||||||||
Bank owned life insurance | 576 | 569 | 559 | 549 | 545 | |||||||||||
Gain (Loss) on sale of premises and equipment | (105) | 302 | (225) | (2) | 1,295 | |||||||||||
Other | 2,059 | 613 | 1,088 | 1,232 | 1,532 | |||||||||||
Total non-interest income | 24,417 | 22,896 | 22,860 | 22,047 | 23,142 | |||||||||||
Non-interest expenses: | ||||||||||||||||
Compensation | 24,494 | 23,379 | 22,107 | 21,896 | 23,398 | |||||||||||
Employee benefits | 3,829 | 4,508 | 5,061 | 5,053 | 3,421 | |||||||||||
Net occupancy and equipment | 5,150 | 3,821 | 3,514 | 3,899 | 3,843 | |||||||||||
Technology and communication | 4,612 | 4,236 | 4,219 | 4,251 | 3,747 | |||||||||||
Debit and credit card processing | 1,719 | 1,637 | 1,706 | 1,419 | 1,470 | |||||||||||
Marketing and business development | 1,754 | 1,357 | 1,784 | 1,095 | 1,544 | |||||||||||
Postage, printing and supplies | 903 | 938 | 889 | 874 | 893 | |||||||||||
Legal and professional | 1,293 | 1,049 | 819 | 797 | 492 | |||||||||||
FDIC Insurance | 1,060 | 937 | 779 | 1,135 | 730 | |||||||||||
Amortization of investments in tax credit partnerships | 324 | 323 | 324 | 323 | 88 | |||||||||||
Capital and deposit based taxes | 601 | 629 | 607 | 639 | 799 | |||||||||||
Merger expenses | - | - | - | - | - | |||||||||||
Intangible amortization | 1,167 | 1,167 | 1,172 | 1,180 | 1,610 | |||||||||||
Loss on disposition of LFA | - | - | - | - | 870 | |||||||||||
Other | 3,107 | 2,721 | 2,819 | 2,753 | 3,041 | |||||||||||
Total non-interest expenses | 50,013 | 46,702 | 45,800 | 45,314 | 45,946 | |||||||||||
Income before income tax expense | 30,374 | 34,734 | 35,639 | 37,180 | 39,084 | |||||||||||
Income tax expense | 6,430 | 7,642 | 7,975 | 8,132 | 9,174 | |||||||||||
Net income | 23,944 | 27,092 | 27,664 | 29,048 | 29,910 | |||||||||||
Less: net income attributed to non-controlling interest | - | - | - | - | 93 | |||||||||||
Net income available to stockholders | $ | 23,944 | $ | 27,092 | $ | 27,664 | $ | 29,048 | $ | 29,817 | ||||||
Net income per share - Basic | $ | 0.82 | $ | 0.93 | $ | 0.95 | $ | 1.00 | $ | 1.02 | ||||||
Net income per share - Diluted | 0.82 | 0.92 | 0.94 | 0.99 | 1.01 | |||||||||||
Cash dividend declared per share | 0.30 | 0.30 | 0.29 | 0.29 | 0.29 | |||||||||||
Weighted average shares - Basic | 29,226 | 29,223 | 29,223 | 29,178 | 29,157 | |||||||||||
Weighted average shares - Diluted | 29,331 | 29,336 | 29,340 | 29,365 | 29,428 | |||||||||||
Quarterly Comparison | ||||||||||||||||
Balance Sheet Data | 12/31/23 | 9/30/23 | 6/30/23 | 3/31/23 | 12/31/22 | |||||||||||
Cash and due from banks | $ | 94,466 | $ | 79,538 | $ | 111,126 | $ | 87,922 | $ | 82,515 | ||||||
Federal funds sold and interest bearing due from banks | 171,493 | 113,499 | 103,204 | 229,076 | 84,852 | |||||||||||
Mortgage loans held for sale | 6,056 | 6,535 | 7,069 | 6,397 | 2,606 | |||||||||||
Investment securities | 1,471,016 | 1,465,453 | 1,542,753 | 1,600,603 | 1,617,834 | |||||||||||
Federal Home Loan Bank stock | 16,236 | 26,241 | 27,366 | 23,226 | 10,928 | |||||||||||
Loans | 5,771,038 | 5,617,084 | 5,418,609 | 5,243,104 | 5,205,918 | |||||||||||
Allowance for credit losses on loans | 79,374 | 78,075 | 77,710 | 75,673 | 73,531 | |||||||||||
Goodwill | 194,074 | 194,074 | 194,074 | 194,074 | 194,074 | |||||||||||
Total assets | 8,170,102 | 7,903,430 | 7,732,552 | 7,667,648 | 7,496,261 | |||||||||||
Non-interest bearing deposits | 1,548,624 | 1,714,918 | 1,766,132 | 1,845,302 | 1,950,198 | |||||||||||
Interest bearing deposits | 5,122,124 | 4,687,889 | 4,442,248 | 4,511,893 | 4,441,054 | |||||||||||
Securities sold under agreements to repurchase | 152,991 | 113,894 | 138,347 | 104,578 | 133,342 | |||||||||||
Federal funds purchased | 12,852 | 11,518 | 11,646 | 14,745 | 8,789 | |||||||||||
Federal Home Loan Bank advances | 200,000 | 350,000 | 400,000 | 275,000 | 50,000 | |||||||||||
Subordinated debentures | 26,740 | 26,641 | 26,541 | 26,442 | 26,343 | |||||||||||
Stockholders' equity | 858,103 | 806,918 | 808,082 | 794,368 | 760,432 | |||||||||||
Total shares outstanding | 29,329 | 29,323 | 29,323 | 29,324 | 29,259 | |||||||||||
Book value per share (3) | $ | 29.26 | $ | 27.52 | $ | 27.56 | $ | 27.09 | $ | 25.99 | ||||||
Tangible common equity per share (3) | 21.95 | 20.17 | 20.17 | 19.66 | 18.50 | |||||||||||
Market value per share | 51.49 | 39.29 | 45.37 | 55.14 | 64.98 | |||||||||||
Capital Ratios | ||||||||||||||||
Total stockholders' equity to total assets (3) | 10.50% | 10.21% | 10.45% | 10.36% | 10.14% | |||||||||||
Tangible common equity to tangible assets (3) | 8.09% | 7.69% | 7.87% | 7.74% | 7.44% | |||||||||||
Average stockholders' equity to average assets | 10.07% | 10.39% | 10.53% | 10.26% | 9.79% | |||||||||||
Total risk-based capital | 12.43% | 12.71% | 12.78% | 12.91% | 12.54% | |||||||||||
Common equity tier 1 risk-based capital | 11.04% | 11.17% | 11.20% | 11.30% | 11.04% | |||||||||||
Tier 1 risk-based capital | 11.43% | 11.57% | 11.61% | 11.73% | 11.47% | |||||||||||
Leverage | 9.62% | 9.80% | 9.83% | 9.56% | 9.33% | |||||||||||
Stock Yards Bancorp, Inc. Financial Information (unaudited) | ||||||||||||||||
Fourth Quarter 2023 Earnings Release | ||||||||||||||||
Quarterly Comparison | ||||||||||||||||
Average Balance Sheet Data | 12/31/23 | 9/30/23 | 6/30/23 | 3/31/23 | 12/31/22 | |||||||||||
Federal funds sold and interest bearing due from banks | $ | 258,950 | $ | 124,653 | $ | 131,958 | $ | 140,831 | $ | 235,448 | ||||||
Mortgage loans held for sale | 5,305 | 7,112 | 8,420 | 6,460 | 6,735 | |||||||||||
Investment securities | 1,618,799 | 1,659,888 | 1,719,045 | 1,754,620 | 1,786,383 | |||||||||||
Federal Home Loan Bank stock | 20,519 | 27,290 | 25,074 | 15,496 | 10,928 | |||||||||||
Loans | 5,676,193 | 5,486,262 | 5,286,597 | 5,236,879 | 5,094,356 | |||||||||||
Total interest earning assets | 7,579,766 | 7,305,205 | 7,171,094 | 7,154,286 | 7,133,850 | |||||||||||
Total assets | 8,116,569 | 7,805,154 | 7,594,901 | 7,579,439 | 7,559,260 | |||||||||||
Non-interest bearing deposits | 1,663,962 | 1,731,724 | 1,781,338 | 1,878,307 | 2,097,858 | |||||||||||
Interest bearing deposits | 5,025,240 | 4,509,411 | 4,414,599 | 4,480,151 | 4,428,582 | |||||||||||
Total deposits | 6,689,202 | 6,241,135 | 6,195,937 | 6,358,458 | 6,526,440 | |||||||||||
Securities sold under agreement to repurchase | 130,148 | 127,063 | 113,051 | 122,049 | 117,138 | |||||||||||
Federal Home Loan Bank advances | 205,435 | 401,630 | 348,352 | 163,056 | 1,087 | |||||||||||
Subordinated debentures | 26,706 | 26,606 | 26,508 | 26,408 | 26,309 | |||||||||||
Total interest bearing liabilities | 5,401,135 | 5,076,486 | 4,916,112 | 4,807,907 | 4,582,005 | |||||||||||
Total stockholders' equity | 817,682 | 810,710 | 799,886 | 777,555 | 740,007 | |||||||||||
Performance Ratios | ||||||||||||||||
Annualized return on average assets (4) | 1.17% | 1.38% | 1.46% | 1.55% | 1.56% | |||||||||||
Annualized return on average equity (4) | 11.62% | 13.26% | 13.87% | 15.15% | 15.99% | |||||||||||
Net interest margin, fully tax equivalent | 3.25% | 3.34% | 3.42% | 3.59% | 3.64% | |||||||||||
Non-interest income to total revenue, fully tax equivalent | 28.22% | 27.15% | 27.24% | 25.85% | 26.12% | |||||||||||
Efficiency ratio, fully tax equivalent (2) | 57.80% | 55.38% | 54.57% | 53.13% | 51.85% | |||||||||||
Loans Segmentation | ||||||||||||||||
Commercial real estate - non-owner occupied | $ | 1,561,689 | $ | 1,557,977 | $ | 1,527,453 | $ | 1,467,780 | $ | 1,443,813 | ||||||
Commercial real estate - owner occupied | 907,424 | 896,522 | 825,026 | 805,417 | 788,936 | |||||||||||
Commercial and industrial | 1,302,809 | 1,246,200 | 1,226,554 | 1,205,222 | 1,230,976 | |||||||||||
Commercial and industrial - PPP | 4,319 | 4,827 | 7,088 | 9,557 | 18,593 | |||||||||||
Residential real estate - owner occupied | 708,893 | 696,162 | 664,870 | 620,417 | 591,515 | |||||||||||
Residential real estate - non-owner occupied | 358,715 | 349,624 | 337,961 | 322,748 | 312,474 | |||||||||||
Construction and land development | 531,324 | 480,120 | 451,324 | 439,673 | 445,690 | |||||||||||
Home equity lines of credit | 211,390 | 203,184 | 202,574 | 200,933 | 200,725 | |||||||||||
Consumer | 145,340 | 143,703 | 139,602 | 136,412 | 139,461 | |||||||||||
Leases | 15,503 | 14,710 | 13,967 | 13,207 | 13,322 | |||||||||||
Credit cards | 23,632 | 24,055 | 22,190 | 21,738 | 20,413 | |||||||||||
Total loans and leases | $ | 5,771,038 | $ | 5,617,084 | $ | 5,418,609 | $ | 5,243,104 | $ | 5,205,918 | ||||||
Asset Quality Data | ||||||||||||||||
Non-accrual loans | $ | 19,058 | $ | 17,227 | $ | 17,364 | $ | 17,389 | $ | 14,242 | ||||||
Troubled debt restructurings | - | - | - | - | - | |||||||||||
Loans past due 90 days or more and still accruing | 110 | 1 | 437 | 894 | 892 | |||||||||||
Total non-performing loans | 19,168 | 17,228 | 17,801 | 18,283 | 15,134 | |||||||||||
Other real estate owned | 10 | 427 | 677 | 677 | 677 | |||||||||||
Total non-performing assets | $ | 19,178 | $ | 17,655 | $ | 18,478 | $ | 18,960 | $ | 15,811 | ||||||
Non-performing loans to total loans (5) | 0.33% | 0.31% | 0.33% | 0.35% | 0.29% | |||||||||||
Non-performing assets to total assets | 0.23% | 0.22% | 0.24% | 0.25% | 0.21% | |||||||||||
Allowance for credit losses on loans to total loans (5) | 1.38% | 1.39% | 1.43% | 1.44% | 1.41% | |||||||||||
Allowance for credit losses on loans to average loans | 1.40% | 1.42% | 1.47% | 1.45% | 1.44% | |||||||||||
Allowance for credit losses on loans to non-performing loans | 414% | 453% | 437% | 414% | 486% | |||||||||||
Net (charge-offs) recoveries | $ | (4,472) | $ | (1,935) | $ | (113) | $ | (108) | $ | (152) | ||||||
Net (charge-offs) recoveries to average loans (7) | -0.08% | -0.04% | 0.00% | 0.00% | 0.00% | |||||||||||
Other Information | ||||||||||||||||
Total assets under management (in millions) | $ | 7,160 | $ | 6,670 | $ | 6,976 | $ | 6,764 | $ | 6,585 | ||||||
Full-time equivalent employees | 1,075 | 1,056 | 1,056 | 1,028 | 1,033 | |||||||||||
(1) - Detail of Provision for credit losses follows: | ||||||||||||||||
Quarterly Comparison | ||||||||||||||||
(in thousands) | 12/31/23 | 9/30/23 | 6/30/23 | 3/31/23 | 12/31/22 | |||||||||||
Provision for credit losses - loans | $ | 5,771 | $ | 2,300 | $ | 2,150 | $ | 2,250 | $ | 3,600 | ||||||
Provision for credit losses - off balance sheet exposures | 275 | 475 | 200 | 375 | (225) | |||||||||||
Total provision for credit losses | $ | 6,046 | $ | 2,775 | $ | 2,350 | $ | 2,625 | $ | 3,375 | ||||||
(2) - The efficiency ratio, a non-GAAP measure, equals total non-interest expenses divided by the sum of net interest income (FTE) and non-interest income. In addition to the efficiency ratio presented, Bancorp considers an adjusted efficiency ratio to be important because it provides a comparable ratio after eliminating net gains (losses) on sales, calls, and impairment of investment securities, as well as net gains (losses) on sales of premises and equipment and disposition of any acquired assets, if applicable, and the fluctuation in non-interest expenses related to amortization of investments in tax credit partnerships and merger-related expenses. | ||||||||||||||||
Quarterly Comparison | ||||||||||||||||
(Dollars in thousands) | 12/31/23 | 9/30/23 | 6/30/23 | 3/31/23 | 12/31/22 | |||||||||||
Total non-interest expenses (a) | $ | 50,013 | $ | 46,702 | $ | 45,800 | $ | 45,314 | $ | 45,946 | ||||||
Less: Loss on disposition of LFA | - | - | - | - | (870) | |||||||||||
Less: Amortization of investments in tax credit partnerships | (324) | (323) | (324) | (323) | (88) | |||||||||||
Total non-interest expenses - Non-GAAP (c) | $ | 49,689 | $ | 46,379 | $ | 45,476 | $ | 44,991 | $ | 44,988 | ||||||
Total net interest income, fully tax equivalent | $ | 62,112 | $ | 61,437 | $ | 61,074 | $ | 63,245 | $ | 65,469 | ||||||
Total non-interest income | 24,417 | 22,896 | 22,860 | 22,047 | 23,142 | |||||||||||
Total revenue - Non-GAAP (b) | 86,529 | 84,333 | 83,934 | 85,292 | 88,611 | |||||||||||
Less: Gain/loss on sale of premises and equipment | 105 | (302) | 225 | 2 | (1,295) | |||||||||||
Less: Loss on sale of securities | 44 | - | - | - | - | |||||||||||
Total adjusted revenue - Non-GAAP (d) | $ | 86,678 | $ | 84,031 | $ | 84,159 | $ | 85,294 | $ | 87,316 | ||||||
Efficiency ratio - Non-GAAP (a/b) | 57.80% | 55.38% | 54.57% | 53.13% | 51.85% | |||||||||||
Adjusted efficiency ratio - Non-GAAP (c/d) | 57.33% | 55.19% | 54.04% | 52.75% | 51.52% | |||||||||||
(3) - The following table provides a reconciliation of total stockholders’ equity in accordance with GAAP to tangible stockholders’ equity, a non-GAAP disclosure. Bancorp provides the tangible book value per share, a non-GAAP measure, in addition to those defined by banking regulators, because of its widespread use by investors as a means to evaluate capital adequacy: | ||||||||||||||||
Quarterly Comparison | ||||||||||||||||
(In thousands, except per share data) | 12/31/23 | 9/30/23 | 6/30/23 | 3/31/23 | 12/31/22 | |||||||||||
Total stockholders' equity - GAAP (a) | $ | 858,103 | $ | 806,918 | $ | 808,082 | $ | 794,368 | $ | 760,432 | ||||||
Less: Goodwill | (194,074) | (194,074) | (194,074) | (194,074) | (194,074) | |||||||||||
Less: Core deposit and other intangibles | (20,304) | (21,471) | (22,638) | (23,810) | (24,990) | |||||||||||
Tangible common equity - Non-GAAP (c) | $ | 643,725 | $ | 591,373 | $ | 591,370 | $ | 576,484 | $ | 541,368 | ||||||
Total assets - GAAP (b) | $ | 8,170,102 | $ | 7,903,430 | $ | 7,732,552 | $ | 7,667,648 | $ | 7,496,261 | ||||||
Less: Goodwill | (194,074) | (194,074) | (194,074) | (194,074) | (194,074) | |||||||||||
Less: Core deposit and other intangibles | (20,304) | (21,471) | (22,638) | (23,810) | (24,990) | |||||||||||
Tangible assets - Non-GAAP (d) | $ | 7,955,724 | $ | 7,687,885 | $ | 7,515,840 | $ | 7,449,764 | $ | 7,277,197 | ||||||
Total stockholders' equity to total assets - GAAP (a/b) | 10.50% | 10.21% | 10.45% | 10.36% | 10.14% | |||||||||||
Tangible common equity to tangible assets - Non-GAAP (c/d) | 8.09% | 7.69% | 7.87% | 7.74% | 7.44% | |||||||||||
Total shares outstanding (e) | 29,329 | 29,323 | 29,323 | 29,324 | 29,259 | |||||||||||
Book value per share - GAAP (a/e) | $ | 29.26 | $ | 27.52 | $ | 27.56 | $ | 27.09 | $ | 25.99 | ||||||
Tangible common equity per share - Non-GAAP (c/e) | 21.95 | 20.17 | 20.17 | 19.66 | 18.50 | |||||||||||
(4) - Return on average assets equals net income divided by total average assets, annualized to reflect a full year return on average assets. Similarly, return on average equity equals net income divided by total average equity, annualized to reflect a full year return on average equity. Bancorp also considers adjusted return on average assets and return on average equity ratios important, as they reflect performance after removing net gains (losses) on certain sales of premises and equipment. | ||||||||||||||||
Quarterly Comparison | ||||||||||||||||
(Dollars in thousands) | 12/31/23 | 9/30/23 | 6/30/23 | 3/31/23 | 12/31/22 | |||||||||||
Net income attributable to stockholders - GAAP (a) | $ | 23,944 | $ | 27,092 | $ | 27,664 | $ | 29,048 | $ | 29,817 | ||||||
Add: Loss on disposition of LFA | - | - | - | - | 870 | |||||||||||
Less: Gain/loss on sale of premises and equipment | 105 | (302) | 225 | 2 | (1,295) | |||||||||||
Less: Tax effect of adjustments to net income | (23) | 66 | (50) | - | 100 | |||||||||||
Total net income - Non-GAAP (b) | $ | 24,026 | $ | 26,856 | $ | 27,664 | $ | 29,050 | $ | 29,492 | ||||||
Total average assets (c) | $ | 8,116,569 | $ | 7,805,154 | $ | 7,594,901 | $ | 7,579,439 | $ | 7,559,260 | ||||||
Total average stockholder equity (d) | 817,682 | 810,710 | 799,886 | 777,555 | 740,007 | |||||||||||
Return on average assets - GAAP (a/c) | 1.17% | 1.38% | 1.46% | 1.55% | 1.56% | |||||||||||
Return on average assets - Non-GAAP (b/c) | 1.17% | 1.37% | 1.46% | 1.55% | 1.55% | |||||||||||
Return on average equity - GAAP (a/d) | 11.62% | 13.26% | 13.87% | 15.15% | 15.99% | |||||||||||
Return on average equity - Non-GAAP (b/d) | 11.66% | 13.14% | 13.87% | 15.15% | 15.81% | |||||||||||
(5) - Allowance for credit losses on loans to total non-PPP loans represents the allowance for credit losses on loans, divided by total loans less PPP loans. Non-performing loans to total non-PPP loans represents non-performing loans, divided by total loans less PPP loans. Bancorp believes these non-GAAP disclosures are important because they provide a comparable ratio after eliminating the PPP loans, which are fully guaranteed by the U.S. SBA and have not been allocated for within the allowance for credit losses on loans and are not at risk of non-performance. | ||||||||||||||||
Quarterly Comparison | ||||||||||||||||
(Dollars in thousands) | 12/31/23 | 9/30/23 | 6/30/23 | 3/31/23 | 12/31/22 | |||||||||||
Total Loans - GAAP (a) | $ | 5,771,038 | $ | 5,617,084 | $ | 5,418,609 | $ | 5,243,104 | $ | 5,205,918 | ||||||
Less: PPP loans | (4,319) | (4,827) | (7,088) | (9,557) | (18,593) | |||||||||||
Total non-PPP Loans - Non-GAAP (b) | $ | 5,766,719 | $ | 5,612,257 | $ | 5,411,521 | $ | 5,233,547 | $ | 5,187,325 | ||||||
Allowance for credit losses on loans (c) | $ | 79,374 | $ | 78,075 | $ | 77,710 | $ | 75,673 | $ | 73,531 | ||||||
Total non-performing loans (d) | 19,168 | 17,228 | 17,801 | 18,283 | 15,134 | |||||||||||
Allowance for credit losses on loans to total loans - GAAP (c/a) | 1.38% | 1.39% | 1.43% | 1.44% | 1.41% | |||||||||||
Allowance for credit losses on loans to total loans - Non-GAAP (c/b) | 1.38% | 1.39% | 1.44% | 1.45% | 1.42% | |||||||||||
Non-performing loans to total loans - GAAP (d/a) | 0.33% | 0.31% | 0.33% | 0.35% | 0.29% | |||||||||||
Non-performing loans to total loans - Non-GAAP (d/b) | 0.33% | 0.31% | 0.33% | 0.35% | 0.29% | |||||||||||
(6) - Interest income on a FTE basis includes the additional amount of interest income that would have been earned if investments in certain tax-exempt interest earning assets had been made in assets subject to federal, state and local taxes yielding the same after-tax income. | ||||||||||||||||
(7) - Quarterly net (charge-offs) recoveries to average loans ratios are not annualized. |
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