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Headline: First Financial Corporation Reports Second Quarter Results
Location: Terre Haute, IN, US
Post Date: Jul 27, 2021 10:30 AM
TAG ID: pznews254738
DocID: 202107278287485-en.xml
Word Count: approx. 1524 words
 
 
Full story:
First Financial Corporation Reports Second Quarter Results

TERRE HAUTE, Ind., July 27, 2021 (GLOBE NEWSWIRE) -- First Financial Corporation (NASDAQ:THFF) today announced results for the second quarter of 2021. For the three months ending June 30, 2021: For the quarter: Net income was $16.6 million compared to $11.9 million for the same period of 2020; Diluted net income per common share of $1.24 compared to $0.87 for the same period of 2020; and Return on average assets was 1.40% compared to 1.10% for the three months ended June 30, 2020. The Corporation further reported results for the six months ending June 30, 2021: Net income was $29.5 million compared to $24.1 million for the same period of 2020; Diluted net income per common share of $2.19 compared to $1.76 for the same period of 2020; and Return on average assets was 1.26% compared to 1.16% for the six months ended June 30, 2020. “We are pleased with our second quarter results,” said Norman L. Lowery, Chairman and Chief Executive Officer. “Our asset quality remains strong which allows us to release some of the credit loss reserves established during the pandemic. Our focus continues to be on our customers and assisting them as they navigate these unusual times.” Average Total LoansAverage total loans for the second quarter of 2021 were $2.62 billion versus $2.73 billion for the comparable period in 2020. Total Loans OutstandingTotal loans outstanding as of June 30, 2021 were $2.57 billion compared to $2.78 billion as of June 30, 2020. Average Total DepositsAverage total deposits for the quarter ended June 30, 2021, were $3.98 billion versus $3.53 billion as of June 30, 2020, an increase of $455 million or 12.90%. Total DepositsTotal deposits were $3.99 billion as of June 30, 2021, compared to $3.57 billion as of June 30, 2020, an increase of $419 million or 11.73%. On a linked quarter basis, total deposits increased $83 million from $3.91 billion for the quarter ending March 31, 2021. Book Value Per ShareBook Value per share was $45.08 at June 30, 2021, compared to $43.04 at June 30, 2020 an increase of 4.73%. Shareholder EquityShareholder equity at June 30, 2021, was $588.2 million compared to $590.3 million on June 30, 2020. In the quarter the Corporation repurchased 497,000 shares of its common stock. Tangible Common Equity to Tangible Asset RatioThe Corporation’s tangible common equity to tangible asset ratio was 10.75% at June 30, 2021, compared to 11.73% at June 30, 2020. Net Interest IncomeNet interest income for the second quarter of 2021 was $35.6 million, compared to $35.9 million reported for the same period of 2020. Net Interest MarginThe net interest margin for the quarter ended June 30, 2021, was 3.23% compared to the 3.97% reported at June 30, 2020. Nonperforming LoansNonperforming loans as of June 30, 2021, were $20.0 million versus $23.0 million as of June 30, 2020. The ratio of nonperforming loans to total loans and leases was 0.78% as of June 30, 2021, versus 0.83% as of June 30, 2020. Credit Loss ProvisionThe provision for credit losses for the three months ended June 30, 2021, was $(2.20) million compared to the $2.97 million provision for the second quarter of 2020. In the first three quarters of 2020 the provision was calculated using the incurred loss basis. Beginning in the fourth quarter 2020, the provision was calculated using the current expected credit loss accounting standard. Net Charge-Offs/RecoveriesIn the second quarter of 2021 net recoveries were $152 thousand compared to net charge-offs of $743 thousand in the same period of 2020. Allowance for Credit LossesIn March 2020 due to the uncertainty surrounding the global pandemic and as provided by the Coronavirus Aid Relief and Economic Security Act the Corporation elected to delay the implementation of the Current Expected Credit Loss accounting standard. On December 31, 2020 the Corporation adopted ASU 2016-13 (topic 326), “Measurement of Credit Losses on Financial Instruments” commonly referenced as the Current Expected Credit Loss (“CECL”) model. CECL was retrospectively adopted on January 1, 2020. The Corporation’s allowance for credit losses as of June 30, 2021, was $44.7 million compared to $23.3 million as of June 30, 2020. The increase is primarily related to the adoption of CECL. The allowance for credit losses as a percent of total loans was 1.74% as of June 30, 2021, compared to 0.84% as of June 30, 2020. The allowance as of June 30, 2021 was calculated using CECL. The allowance as of June 30, 2020 was calculated using the incurred loss method. Non-Interest IncomeNon-interest income for the three months ended June 30, 2021 and 2020 was $10.9 and $8.8 million, respectively. Non-Interest ExpenseNon-interest expense for the three months ended June 30, 2021, was $28.0 million compared to $26.9 million in 2020. Efficiency RatioThe Corporation’s efficiency ratio was 58.75% for the quarter ending June 30, 2021, versus 58.78% for the same period in 2020. Income TaxesIncome tax expense for the six months ended June 30, 2021, was $7.38 million versus $5.92 million for the same period in 2020. The effective tax rate for the second quarter of 2021 was 20.02% compared to 19.71% for same period of 2020. “I am proud of the dedication of our associates in providing sound advice and financial solutions to our customers, as we continue to navigate through COVID-19 and its related issues,” Lowery stated. About First Financial CorporationFirst Financial Corporation (NASDAQ:THFF) is the holding company for First Financial Bank N.A. and The Morris Plan Company of Terre Haute, Inc. First Financial Bank N.A. is the fifth oldest national bank in the United States, operating 80 banking centers in Illinois, Indiana, Kentucky and Tennessee. The Morris Plan Company of Terre Haute, Inc. is a state industrial chartered financial institution operating one office in Terre Haute, Indiana. Additional information is available at www.first-online.bank. Investor Contact: Rodger A. McHargueChief Financial OfficerP: 812-238-6334 E: [email protected]  Three Months EndedSix Months Ended June 30,March 31,June 30,June 30,June 30, 20212021202020212020END OF PERIOD BALANCES     Assets$4,753,308 $4,681,216 $4,368,112 $4,753,308 $4,368,112 Deposits$3,988,751 $3,905,348 $3,569,893 $3,988,751 $3,569,893 Loans, including net deferred loan costs$2,568,713 $2,646,937 $2,777,083 $2,568,713 $2,777,083 Allowance for Credit Losses$44,732 $46,776 $23,285 $44,732 $23,285 Total Equity$588,163 $598,112 $590,284 $588,163 $590,284 Tangible Common Equity (a)$501,459 $510,981 $501,863 $501,459 $501,863       AVERAGE BALANCES     Total Assets$4,751,068 $4,600,750 $4,317,011 $4,675,909 $4,169,900 Earning Assets$4,552,581 $4,404,109 $3,720,477 $4,478,345 $3,673,078 Investments$1,244,551 $1,133,439 $989,545 $1,188,995 $989,034 Loans$2,619,887 $2,640,291 $2,727,820 $2,630,089 $2,682,428 Total Deposits$3,981,243 $3,816,705 $3,526,529 $3,898,974 $3,398,578 Interest-Bearing Deposits$3,173,782 $3,059,290 $2,858,594 $3,116,536 $2,798,994 Interest-Bearing Liabilities$101,594 $110,448 $121,791 $106,021 $114,317 Total Equity$600,599 $600,669 $591,522 $600,634 $580,609       INCOME STATEMENT DATA     Net Interest Income$35,628 $34,913 $35,895 $70,541 $72,245 Net Interest Income Fully Tax Equivalent (b)$36,719 $35,959 $36,962 $72,678 $74,371 Provision for Credit Losses$(2,196)$452 $2,965 $(1,744)$5,655 Non-interest Income$10,931 $9,294 $8,776 $20,225 $17,871 Non-interest Expense$27,996 $27,639 $26,883 $55,635 $54,437 Net Income$16,614 $12,877 $11,924 $29,491 $24,105       PER SHARE DATA     Basic and Diluted Net Income Per Common Share$1.24 $0.95 $0.87 $2.19 $1.76 Cash Dividends Declared Per Common Share$0.53 $— $0.52 $0.53 $0.52 Book Value Per Common Share$45.08 $44.2 $43.04 $45.08 $43.04 Tangible Book Value Per Common Share (c)$38.31 $37.76 $36.68 $38.43 $36.59 Basic Weighted Average Common Shares Outstanding13,414 13,533 13,715 13,473 13,727  (a) Tangible common equity is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible common equity by excluding goodwill and other intangible assets from shareholder's equity.(b) Net interest income fully tax equivalent is a non-GAAP financial measure derived from GAAP-based amounts. We calculate net interest income fully tax equivalent by adding back the tax equivalent factor of tax exempt income to net interest income. We calculate the tax equivalent factor of tax exempt income by dividing tax exempt income by the net of tax rate of 75%.(c) Tangible book value per common share is a non-GAAP financial measure derived from GAAP-based amounts. We calculate the factor by dividing average tangible common equity by average shares outstanding. We calculate average tangible common equity by excluding average intangible assets from average shareholder's equity. Key RatiosThree Months EndedSix Months Ended June 30,March 31,June 30,June 30,June 30, 20212021202020212020Return on average assets1.40 %1.12%1.10%1.26%1.16%Return on average common shareholder's equity11.06 %8.58%8.06%9.82%8.30%Efficiency ratio58.75 %61.08%58.78%59.89%59.02%Average equity to average assets12.64 %13.06%13.70%12.85%13.92%Net interest margin (a)3.23 %3.27%3.97%3.25%4.05%Net charge-offs to average loans and leases(0.02)%0.11%0.11%0.04%0.17%Credit loss reserve to loans and leases1.74 %1.77%0.84%1.74%0.84%Credit loss reserve to nonperforming loans223.46 %222.64%101.12%223.46%101.12%Nonperforming loans to loans and leases0.78 %0.79%0.83%0.78%0.83%Tier 1 leverage10.72 %11.34%11.64%10.72%11.64%Risk-based capital - Tier 117.15 %16.17%15.44%17.15%15.44% (a) Net interest margin is calculated on a tax equivalent basis. Asset QualityThree Months EndedSix Months Ended June 30,March 31,June 30,June 30,June 30, 20212021202020212020Accruing loans and leases past due 30-89 days$9,430  $8,373 $15,358 $9,430 $15,358 Accruing loans and leases past due 90 days or more$1,202  $2,001 $4,438 $1,202 $4,438 Nonaccrual loans and leases$14,356  $14,545 $14,634 $14,356 $14,634 Total troubled debt restructuring$4,460  $4,464 $3,899 $4,460 $3,899 Other real estate owned$989  $942 $3,577 $989 $3,577 Nonperforming loans and other real estate owned$21,007  $21,952 $26,548 $21,007 $26,548 Total nonperforming assets$24,272  $25,280 $29,493 $24,272 $29,493 Gross charge-offs$1,151  $2,338 $1,540 $3,489 $4,444 Recoveries$1,303  $1,610 $797 $2,913 $2,131 Net charge-offs/(recoveries)$(152) $728 $743 $576 $2,313  CONSOLIDATED BALANCE SHEETS(Dollar amounts in thousands, except per share data)  June 30,2021 December 31,2020 (unaudited)ASSETS   Cash and due from banks$677,862  $657,470 Federal funds sold516  301 Securities available-for-sale1,219,625  1,020,744 Loans:   Commercial1,521,707  1,521,711 Residential564,859  604,652 Consumer482,147  479,750  2,568,713  2,606,113 (Less) plus:   Net deferred loan costs2,241  4,181 Allowance for credit losses(44,732) (47,052) 2,526,222  2,563,242 Restricted stock14,825  14,812 Accrued interest receivable15,103  16,957 Premises and equipment, net63,895  62,063 Bank-owned life insurance106,560  95,849 Goodwill78,592  78,592 Other intangible assets8,112  8,972 Other real estate owned989  1,012 Other assets41,007  37,530 TOTAL ASSETS$4,753,308  $4,557,544     LIABILITIES AND SHAREHOLDERS’ EQUITY   Deposits:   Non-interest-bearing$780,528  $732,694 Interest-bearing:   Certificates of deposit exceeding the FDIC insurance limits77,647  107,764 Other interest-bearing deposits3,130,576  2,915,487  3,988,751  3,755,945 Short-term borrowings98,525  116,061 FHLB advances5,888  5,859 Other liabilities71,981  82,687 TOTAL LIABILITIES4,165,145  3,960,552     Shareholders’ equity   Common stock, $.125 stated value per share;   Authorized shares-40,000,000   Issued shares-16,096,313 in 2021 and 16,075,154 in 2020   Outstanding shares-13,048,229 in 2021 and 13,558,511 in 20202,008  2,007 Additional paid-in capital141,240  140,820 Retained earnings543,595  521,103 Accumulated other comprehensive income/(loss)1,412  9,764 Less: Treasury shares at cost-3,048,084 in 2021 and 2,516,643 in 2020(100,092) (76,702)TOTAL SHAREHOLDERS’ EQUITY588,163  596,992 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$4,753,308  $4,557,544  CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME(Dollar amounts in thousands, except per share data)  Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 (unaudited)INTEREST INCOME:       Loans, including related fees$31,966  $33,224  $63,823  $68,258 Securities:       Taxable3,355  3,624  6,434  7,653 Tax-exempt2,163  2,008  4,237  3,946 Other387  400  733  802 TOTAL INTEREST INCOME37,871  39,256  75,227  80,659 INTEREST EXPENSE:       Deposits2,090  3,019  4,376  7,549 Short-term borrowings94  101  192  368 Other borrowings59  241  118  497 TOTAL INTEREST EXPENSE2,243  3,361  4,686  8,414 NET INTEREST INCOME35,628  35,895  70,541  72,245 Provision for credit losses(2,196) 2,965  (1,744) 5,655 NET INTEREST INCOME AFTER PROVISION       FOR LOAN LOSSES37,824  32,930  72,285  66,590 NON-INTEREST INCOME:       Trust and financial services1,313  1,288  2,618  2,822 Service charges and fees on deposit accounts2,327  2,102  4,570  5,100 Other service charges and fees5,039  3,869  9,281  7,199 Securities gains (losses), net258  31  106  225 Gain on sales of mortgage loans1,450  1,205  2,843  1,903 Other544  281  807  622 TOTAL NON-INTEREST INCOME10,931  8,776  20,225  17,871 NON-INTEREST EXPENSE:       Salaries and employee benefits16,031  14,323  31,708  30,295 Occupancy expense2,002  2,162  4,151  4,091 Equipment expense2,440  2,673  5,018  5,134 FDIC Expense287  49  585  (181)Other7,236  7,676  14,173  15,098 TOTAL NON-INTEREST EXPENSE27,996  26,883  55,635  54,437 INCOME BEFORE INCOME TAXES20,759  14,823  36,875  30,024 Provision for income taxes4,145  2,899  7,384  5,919 NET INCOME16,614  11,924  29,491  24,105 OTHER COMPREHENSIVE INCOME       Change in unrealized gains/(losses) on securities, net of reclassifications and taxes1,772  3,130  (9,296) 16,228 Change in funded status of post retirement benefits, net of taxes472  384  944  788 COMPREHENSIVE INCOME$18,858  $15,438  $21,139  $41,121 PER SHARE DATA       Basic and Diluted Earnings per Share$1.24  $0.87  $2.19  $1.76 Weighted average number of shares outstanding (in thousands)13,414  13,715  13,473  13,727 

 
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