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Triumph Bancorp Reports Fourth Quarter Net Income to Common Stockholders of $25.8 million
来源: Nasdaq GlobeNewswire / 20 1月 2022 16:07:01 America/New_York
DALLAS, Jan. 20, 2022 (GLOBE NEWSWIRE) -- Triumph Bancorp, Inc. (Nasdaq: TBK) (“Triumph” or the “Company”) today announced earnings and operating results for the fourth quarter of 2021.
As part of how we measure our results, we use certain non-GAAP financial measures to ascertain performance. These non-GAAP financial measures are reconciled in the section labeled “Metrics and non-GAAP financial reconciliation” at the end of this press release.
2021 Fourth Quarter Highlights
- For the fourth quarter of 2021, net income to common shareholders was $25.8 million, and diluted earnings per share were $1.02.
- Net interest income was $104.1 million.
- Non-interest income was $14.3 million.
- Non-interest expense was $83.0 million. Included in non-interest expense was a $7.4 million accrual for our Strategic Equity Grant ("SEG") reflected in salaries and employee benefits which represents a cumulative catch-up to cover two-thirds of the three year vesting period. Further discussion of the SEG can be found in our 2020 Proxy.
- Net interest margin was 7.66%. Yield on loans and the average cost of our total deposits were 8.68% and 0.16%, respectively.
- Credit loss expense for the quarter ended December 31, 2021 was $2.0 million.
- Net charge-offs were $0.2 million for the quarter.
- The total dollar value of invoices purchased by Triumph Business Capital was $4.033 billion with an average invoice size of $2,416. The transportation average invoice size for the quarter was $2,291.
- TriumphPay processed 4,027,680 invoices paying carriers a total of $5.242 billion.
Balance Sheet
Total loans held for investment increased $84.8 million, or 1.8%, during the fourth quarter to $4.868 billion at December 31, 2021. Average loans held for investment for the quarter increased $73.1 million, or 1.5%, to $4.844 billion.
Total deposits were $4.647 billion at December 31, 2021, a decrease of $175.9 million, or 3.6%, in the fourth quarter of 2021. Non-interest-bearing deposits accounted for 41% of total deposits and non-time deposits accounted for 86% of total deposits at December 31, 2021.
Asset Quality and Allowance for Credit Loss
Our nonperforming assets ratio at December 31, 2021 was 0.92%. Approximately 2 basis points of this ratio at December 31, 2021 consisted of $1.4 million of the acquired Over-Formula Advance portfolio which represents the portion that is not covered by CVLG's indemnification. An additional 33 basis points of this ratio at December 31, 2021 consisted of $19.4 million of the Misdirected Payments. Over-Formula Advances and Misdirected Payments are discussed in greater detail below.
Our past-due loan ratio at December 31, 2021 was 2.86%. Approximately 21 basis points of this ratio at December 31, 2021 consisted of $10.1 million of past due factored receivables related to the Over-Formula Advance portfolio. An additional 40 basis points of this ratio at December 31, 2021 consisted of the $19.4 million of Misdirected Payments, as discussed below.
Our ACL as a percentage of loans held for investment increased 1 basis point during the quarter to 0.87% at December 31, 2021.
CARES Act and Paycheck Protection Program
As of December 31, 2021, our balance sheet reflected deferrals on outstanding loan balances of $31.9 million to assist customers impacted by COVID-19. Modifications related to the COVID-19 pandemic and qualifying under the provisions of Section 4013 of the CARES Act are not considered troubled debt restructurings. As of December 31, 2021, these deferred balances carried accrued interest of $0.1 million.
As of December 31, 2021, we carried 118 PPP loans representing a balance of $27.2 million classified as commercial loans. We recognized $2.7 million in fees from the SBA on PPP loans during the three months ended December 31, 2021 and carry $0.8 million of deferred fees on PPP loans at quarter end. The remaining fees will be amortized over the respective lives of the loans or recognized upon forgiveness of the loans.
Items related to our July 2020 acquisition of TFS
As disclosed on our SEC Forms 8-K filed on July 8, 2020 and September 23, 2020, we acquired the transportation factoring assets of TFS, a wholly owned subsidiary of Covenant Logistics Group, Inc. ("CVLG"), and subsequently amended the terms of that transaction. There were no material developments related to that transaction that impacted our operating results for the three months ended December 31, 2021.
At December 31, 2021, the carrying value of the acquired over-formula advances was $10.1 million, the total reserve on acquired over-formula advances was $10.1 million and the balance of our indemnification asset, the value of the payment that would be due to us from CVLG in the event that these over-advances are charged off, was $4.8 million.
As of December 31, 2021 we carried a separate $19.4 million receivable (the “Misdirected Payments”) payable by the United States Postal Service (“USPS”) arising from accounts factored to the largest over-formula advance carrier. This amount is separate from the acquired Over-Formula Advances. The amounts represented by this receivable were paid by the USPS directly to such customer in contravention of notices of assignment delivered to, and previously honored by, the USPS, which amount was then not remitted back to us by such customer as required. The USPS disputes their obligation to make such payment, citing purported deficiencies in the notices delivered to them. In addition to commencing litigation against such customer, we have commenced litigation in the United States Court of Federal Claims against the USPS seeking a ruling that the USPS was obligated to make the payments represented by this receivable directly to us. Based on our legal analysis and discussions with our counsel advising us on this matter, we continue to believe it is probable that we will prevail in such action and that the USPS will have the capacity to make payment on such receivable. Consequently, we have not reserved for such balance as of December 31, 2021. The full amount of such receivable is reflected in non-performing and past due factored receivables as of December 31, 2021 in accordance with our policy. As of December 31, 2021, the entire $19.4 million Misdirected Payments amount was greater than 90 days past due.
Conference Call Information
Aaron P. Graft, Vice Chairman and CEO and Brad Voss, CFO will review the financial results in a conference call for investors and analysts beginning at 7:00 a.m. Central Time on Friday, January 21, 2022.
To participate in the live conference call, please dial 1-844-200-6205 (International: +1-929-526-1599) and access code 984179. A simultaneous audio-only webcast may be accessed via the Company's website at www.triumphbancorp.com through the Investor Relations, News & Events, Webcasts and Presentations links, or through a direct link here at: https://services.choruscall.com/links/tbk220121.html. An archive of this conference call will subsequently be available at this same location on the Company’s website.
About Triumph
Triumph Bancorp, Inc. (Nasdaq: TBK) is a financial holding company headquartered in Dallas, Texas, offering a diversified line of payments, factoring, and banking services. www.triumphbancorp.com
Forward-Looking Statements
This press release contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; the impact of COVID-19 on our business, including the impact of the actions taken by governmental authorities to try and contain the virus or address the impact of the virus on the United States economy (including, without limitation, the CARES Act), and the resulting effect of all of such items on our operations, liquidity and capital position, and on the financial condition of our borrowers and other customers; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; changes in management personnel; interest rate risk; concentration of our products and services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; risks related to the integration of acquired businesses, including our acquisition of HubTran Inc. and developments related to our acquisition of Transport Financial Solutions and the related over-formula advances, and any future acquisitions; our ability to successfully identify and address the risks associated with our possible future acquisitions, and the risks that our prior and possible future acquisitions make it more difficult for investors to evaluate our business, financial condition and results of operations, and impairs our ability to accurately forecast our future performance; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of FDIC, insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.
While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 12, 2021.
Non-GAAP Financial Measures
This press release includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided at the end of this press release.
The following table sets forth key metrics used by Triumph to monitor our operations. Footnotes in this table can be found in our definitions of non-GAAP financial measures at the end of this document.
As of and for the Three Months Ended As of and for the Twelve
Months Ended(Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020December 31,
2021December 31,
2020Financial Highlights: Total assets $ 5,956,250 $ 6,024,535 $ 6,015,877 $ 6,099,628 $ 5,935,791 $ 5,956,250 $ 5,935,791 Loans held for investment $ 4,867,572 $ 4,782,730 $ 4,831,215 $ 5,084,512 $ 4,996,776 $ 4,867,572 $ 4,996,776 Deposits $ 4,646,679 $ 4,822,575 $ 4,725,450 $ 4,789,665 $ 4,716,600 $ 4,646,679 $ 4,716,600 Net income available to common stockholders $ 25,839 $ 23,627 $ 27,180 $ 33,122 $ 31,328 $ 109,768 $ 62,323 Performance Ratios - Annualized: Return on average assets 1.77 % 1.61 % 1.84 % 2.29 % 2.21 % 1.87 % 1.18 % Return on average total equity 12.41 % 11.85 % 14.27 % 18.42 % 17.73 % 14.10 % 9.67 % Return on average common equity 12.71 % 12.13 % 14.70 % 19.14 % 18.44 % 14.52 % 9.77 % Return on average tangible common equity (1) 19.41 % 19.21 % 20.92 % 26.19 % 25.70 % 21.42 % 13.92 % Yield on loans(2) 8.68 % 7.92 % 7.77 % 7.24 % 7.20 % 7.91 % 7.00 % Cost of interest bearing deposits 0.27 % 0.27 % 0.31 % 0.41 % 0.54 % 0.32 % 0.93 % Cost of total deposits 0.16 % 0.16 % 0.20 % 0.28 % 0.38 % 0.20 % 0.67 % Cost of total funds 0.29 % 0.38 % 0.34 % 0.42 % 0.51 % 0.36 % 0.80 % Net interest margin(2) 7.66 % 6.69 % 6.47 % 6.06 % 6.20 % 6.72 % 5.71 % Net non-interest expense to average assets 4.56 % 4.00 % 3.75 % 3.14 % 2.54 % 3.87 % 2.98 % Adjusted net non-interest expense to average assets (1) 4.56 % 4.00 % 3.55 % 3.14 % 2.54 % 3.82 % 3.14 % Efficiency ratio 70.16 % 70.13 % 67.96 % 62.57 % 55.95 % 67.87 % 64.35 % Adjusted efficiency ratio (1) 70.16 % 70.13 % 65.09 % 62.57 % 55.95 % 67.16 % 65.97 % Asset Quality:(3) Past due to total loans 2.86 % 2.31 % 2.28 % 1.96 % 3.22 % 2.86 % 3.22 % Non-performing loans to total loans 0.95 % 0.90 % 1.06 % 1.17 % 1.16 % 0.95 % 1.16 % Non-performing assets to total assets 0.92 % 0.86 % 0.97 % 1.15 % 1.15 % 0.92 % 1.15 % ACL to non-performing loans 91.20 % 95.75 % 88.92 % 80.87 % 164.98 % 91.20 % 164.98 % ACL to total loans 0.87 % 0.86 % 0.95 % 0.94 % 1.92 % 0.87 % 1.92 % Net charge-offs to average loans — % 0.08 % 0.01 % 0.85 % 0.03 % 0.95 % 0.10 % Capital: Tier 1 capital to average assets(4) 11.11 % 10.43 % 9.73 % 10.89 % 10.80 % 11.11 % 10.80 % Tier 1 capital to risk-weighted assets(4) 11.51 % 11.06 % 10.33 % 11.28 % 10.60 % 11.51 % 10.60 % Common equity tier 1 capital to risk-weighted assets(4) 9.94 % 9.45 % 8.74 % 9.72 % 9.05 % 9.94 % 9.05 % Total capital to risk-weighted assets 14.10 % 13.69 % 12.65 % 13.58 % 13.03 % 14.10 % 13.03 % Total equity to total assets 14.42 % 13.62 % 13.17 % 12.53 % 12.24 % 14.42 % 12.24 % Tangible common stockholders' equity to tangible assets(1) 9.46 % 8.63 % 8.04 % 8.98 % 8.56 % 9.46 % 8.56 % Per Share Amounts: Book value per share $ 32.35 $ 30.87 $ 29.76 $ 28.90 $ 27.42 $ 32.35 $ 27.42 Tangible book value per share (1) $ 21.34 $ 19.73 $ 18.35 $ 21.34 $ 19.78 $ 21.34 $ 19.78 Basic earnings per common share $ 1.04 $ 0.95 $ 1.10 $ 1.34 $ 1.27 $ 4.44 $ 2.56 Diluted earnings per common share $ 1.02 $ 0.94 $ 1.08 $ 1.32 $ 1.25 $ 4.35 $ 2.53 Adjusted diluted earnings per common share(1) $ 1.02 $ 0.94 $ 1.17 $ 1.32 $ 1.25 $ 4.44 $ 2.26 Shares outstanding end of period 25,158,879 25,123,342 25,109,703 24,882,929 24,868,218 25,158,879 24,868,218 Unaudited consolidated balance sheet as of:
(Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020ASSETS Total cash and cash equivalents $ 383,178 $ 532,764 $ 444,439 $ 380,811 $ 314,393 Securities - available for sale 182,426 164,816 193,627 205,330 224,310 Securities - held to maturity, net 4,947 5,488 5,658 5,828 5,919 Equity securities 5,504 5,623 5,854 5,826 5,826 Loans held for sale 7,330 26,437 31,136 22,663 24,546 Loans held for investment 4,867,572 4,782,730 4,831,215 5,084,512 4,996,776 Allowance for credit losses (42,213 ) (41,017 ) (45,694 ) (48,024 ) (95,739 ) Loans, net 4,825,359 4,741,713 4,785,521 5,036,488 4,901,037 FHLB and other restricted stock 10,146 4,901 8,096 9,807 6,751 Premises and equipment, net 105,729 104,311 106,720 105,390 103,404 Other real estate owned ("OREO"), net 524 893 1,013 1,421 1,432 Goodwill and intangible assets, net 276,856 280,055 286,567 188,006 189,922 Bank-owned life insurance 40,993 41,540 41,912 41,805 41,608 Deferred tax asset, net 10,023 — — 1,260 6,427 Indemnification asset 4,786 4,786 5,246 5,246 36,225 Other assets 98,449 111,208 100,088 89,747 73,991 Total assets $ 5,956,250 $ 6,024,535 $ 6,015,877 $ 6,099,628 $ 5,935,791 LIABILITIES Non-interest bearing deposits $ 1,925,370 $ 2,020,984 $ 1,803,552 $ 1,637,653 $ 1,352,785 Interest bearing deposits 2,721,309 2,801,591 2,921,898 3,152,012 3,363,815 Total deposits 4,646,679 4,822,575 4,725,450 4,789,665 4,716,600 Customer repurchase agreements 2,103 11,990 9,243 2,668 3,099 Federal Home Loan Bank advances 180,000 30,000 130,000 180,000 105,000 Payment Protection Program Liquidity Facility 27,144 97,554 139,673 158,796 191,860 Subordinated notes 106,957 106,755 87,620 87,564 87,509 Junior subordinated debentures 40,602 40,467 40,333 40,201 40,072 Deferred tax liability, net — 982 3,333 — — Other liabilities 93,901 93,538 87,837 76,730 64,870 Total liabilities 5,097,386 5,203,861 5,223,489 5,335,624 5,209,010 EQUITY Preferred Stock 45,000 45,000 45,000 45,000 45,000 Common stock 283 282 282 280 280 Additional paid-in-capital 510,939 499,282 494,224 490,699 489,151 Treasury stock, at cost (104,743 ) (104,600 ) (104,486 ) (103,059 ) (103,052 ) Retained earnings 399,351 373,512 349,885 322,705 289,583 Accumulated other comprehensive income (loss) 8,034 7,198 7,483 8,379 5,819 Total stockholders' equity 858,864 820,674 792,388 764,004 726,781 Total liabilities and equity $ 5,956,250 $ 6,024,535 $ 6,015,877 $ 6,099,628 $ 5,935,791 Unaudited consolidated statement of income:
For the Three Months Ended For the Twelve Months Ended (Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020December 31,
2021December 31,
2020Interest income: Loans, including fees $ 43,979 $ 44,882 $ 45,988 $ 48,706 $ 50,723 $ 183,555 $ 198,214 Factored receivables, including fees 62,196 50,516 47,328 37,795 37,573 197,835 114,434 Securities 1,438 1,126 1,187 1,650 1,519 5,401 8,229 FHLB and other restricted stock 25 28 27 76 56 156 530 Cash deposits 141 183 158 126 68 608 708 Total interest income 107,779 96,735 94,688 88,353 89,939 387,555 322,115 Interest expense: Deposits 1,907 1,948 2,470 3,372 4,308 9,697 27,403 Subordinated notes 1,297 2,449 1,350 1,349 1,347 6,445 5,363 Junior subordinated debentures 444 443 446 442 452 1,775 2,114 Other borrowings 74 124 140 170 234 508 2,507 Total interest expense 3,722 4,964 4,406 5,333 6,341 18,425 37,387 Net interest income 104,057 91,771 90,282 83,020 83,598 369,130 284,728 Credit loss expense (benefit) 2,008 (1,187 ) (1,806 ) (7,845 ) 4,680 (8,830 ) 38,329 Net interest income after credit loss expense (benefit) 102,049 92,958 92,088 90,865 78,918 377,960 246,399 Non-interest income: Service charges on deposits 2,050 2,030 1,857 1,787 1,643 7,724 5,274 Card income 2,470 2,144 2,225 1,972 1,949 8,811 7,781 Net OREO gains (losses) and valuation adjustments 29 (9 ) (287 ) (80 ) (217 ) (347 ) (616 ) Net gains (losses) on sale of securities — 4 1 — 16 5 3,226 Fee income 5,711 5,198 4,470 2,249 1,615 17,628 6,007 Insurance commissions 1,138 1,231 1,272 1,486 1,327 5,127 4,232 Gain on sale of subsidiary — — — — — — 9,758 Other 2,861 1,457 4,358 6,877 16,053 15,553 24,723 Total non-interest income 14,259 12,055 13,896 14,291 22,386 54,501 60,385 Non-interest expense: Salaries and employee benefits 52,544 43,769 41,658 35,980 33,798 173,951 126,975 Occupancy, furniture and equipment 6,194 6,388 6,112 5,779 7,046 24,473 22,766 FDIC insurance and other regulatory assessments 288 353 500 977 350 2,118 1,520 Professional fees 2,633 2,362 5,052 2,545 2,326 12,592 9,349 Amortization of intangible assets 3,199 3,274 2,428 1,975 2,065 10,876 8,330 Advertising and promotion 1,640 1,403 1,241 890 1,170 5,174 4,718 Communications and technology 7,844 7,090 6,028 5,900 5,639 26,862 22,153 Other 8,662 8,174 7,779 6,846 6,904 31,461 26,263 Total non-interest expense 83,004 72,813 70,798 60,892 59,298 287,507 222,074 Net income before income tax 33,304 32,200 35,186 44,264 42,006 144,954 84,710 Income tax expense 6,664 7,771 7,204 10,341 9,876 31,980 20,686 Net income $ 26,640 $ 24,429 $ 27,982 $ 33,923 $ 32,130 $ 112,974 $ 64,024 Dividends on preferred stock (801 ) (802 ) (802 ) (801 ) (802 ) (3,206 ) (1,701 ) Net income available to common stockholders $ 25,839 $ 23,627 $ 27,180 $ 33,122 $ 31,328 $ 109,768 $ 62,323 Earnings per share:
For the Three Months Ended Twelve Months Ended (Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020December 31,
2021December 31,
2020Basic Net income to common stockholders $ 25,839 $ 23,627 $ 27,180 $ 33,122 $ 31,328 $ 109,768 $ 62,323 Weighted average common shares outstanding 24,786,720 24,759,419 24,724,128 24,675,109 24,653,099 24,736,713 24,387,932 Basic earnings per common share $ 1.04 $ 0.95 $ 1.10 $ 1.34 $ 1.27 $ 4.44 $ 2.56 Diluted Net income to common stockholders - diluted $ 25,839 $ 23,627 $ 27,180 $ 33,122 $ 31,328 $ 109,768 $ 62,323 Weighted average common shares outstanding 24,786,720 24,759,419 24,724,128 24,675,109 24,653,099 24,736,713 24,387,932 Dilutive effects of: Assumed exercises of stock options 124,462 121,110 134,358 130,016 101,664 130,198 64,104 Restricted stock awards 236,251 141,204 139,345 169,514 136,239 170,276 86,498 Restricted stock units 87,605 74,268 73,155 66,714 50,156 76,049 25,978 Performance stock units - market based 150,969 131,346 134,313 128,167 112,228 136,199 51,304 Performance stock units - performance based — — — — — — — Employee stock purchase plan 4,726 616 3,708 1,418 — 2,617 — Weighted average shares outstanding - diluted 25,390,733 25,227,963 25,209,007 25,170,938 25,053,386 25,252,052 24,615,816 Diluted earnings per common share $ 1.02 $ 0.94 $ 1.08 $ 1.32 $ 1.25 $ 4.35 $ 2.53 Shares that were not considered in computing diluted earnings per common share because they were antidilutive or have not met the thresholds to be considered in the dilutive calculation are as follows:
For the Three Months Ended Twelve Months Ended December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020December 31,
2021December 31,
2020Stock options — 16,939 16,939 — — 16,939 64,947 Restricted stock awards 8,463 — — — — 8,463 — Restricted stock units 15,000 — — — — 15,000 — Performance stock units - market based — 12,020 13,520 — — — — Performance stock units - performance based 259,383 259,383 265,625 256,625 256,625 259,383 256,625 Employee stock purchase plan — — — — — — — Loans held for investment summarized as of:
(Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020Commercial real estate $ 632,775 $ 630,106 $ 701,576 $ 784,110 $ 779,158 Construction, land development, land 123,464 171,814 185,444 223,841 219,647 1-4 family residential properties 123,115 127,073 135,288 142,859 157,147 Farmland 77,394 82,990 91,122 97,835 103,685 Commercial 1,430,429 1,398,497 1,453,583 1,581,125 1,562,957 Factored receivables 1,699,537 1,607,028 1,398,299 1,208,718 1,120,770 Consumer 10,885 12,677 12,389 14,332 15,838 Mortgage warehouse 769,973 752,545 853,514 1,031,692 1,037,574 Total loans $ 4,867,572 $ 4,782,730 $ 4,831,215 $ 5,084,512 $ 4,996,776 Our banking loan portfolio consists of traditional community bank loans as well as commercial finance product lines focused on businesses that require specialized financial solutions and national lending product lines that further diversify our lending operations.
Banking loans held for investment are further summarized below:
(Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020Commercial real estate $ 632,775 $ 630,106 $ 701,576 $ 784,110 $ 779,158 Construction, land development, land 123,464 171,814 185,444 223,841 219,647 1-4 family residential 123,115 127,073 135,288 142,859 157,147 Farmland 77,394 82,990 91,122 97,835 103,685 Commercial - General 295,662 289,242 290,562 288,458 340,850 Commercial - Paycheck Protection Program 27,197 87,413 135,307 237,299 189,857 Commercial - Agriculture 70,127 77,263 76,346 83,859 94,572 Commercial - Equipment 621,437 588,105 604,396 623,248 573,163 Commercial - Asset-based lending 281,659 213,927 181,394 188,825 180,488 Commercial - Liquid Credit 134,347 142,547 165,578 159,436 184,027 Consumer 10,885 12,677 12,389 14,332 15,838 Mortgage Warehouse 769,973 752,545 853,514 1,031,692 1,037,574 Total banking loans held for investment $ 3,168,035 $ 3,175,702 $ 3,432,916 $ 3,875,794 $ 3,876,006 The following table presents the Company’s operating segments:
(Dollars in thousands) Three months ended December 31, 2021 Banking Factoring Payments Corporate Consolidated Total interest income $ 45,534 $ 58,042 $ 4,154 $ 49 $ 107,779 Intersegment interest allocations 2,272 (2,178 ) (94 ) — — Total interest expense 1,980 — — 1,742 3,722 Net interest income (expense) 45,826 55,864 4,060 (1,693 ) 104,057 Credit loss expense (benefit) 171 1,600 (110 ) 347 2,008 Net interest income after credit loss expense 45,655 54,264 4,170 (2,040 ) 102,049 Noninterest income 8,308 2,295 3,209 447 14,259 Noninterest expense 46,617 22,335 13,376 676 83,004 Operating income (loss) $ 7,346 $ 34,224 $ (5,997 ) $ (2,269 ) $ 33,304 (Dollars in thousands) Three months ended September 30, 2021 Banking Factoring Payments Corporate Consolidated Total interest income $ 46,175 $ 47,222 $ 3,295 $ 43 $ 96,735 Intersegment interest allocations 2,452 (2,341 ) (111 ) — — Total interest expense 2,073 — — 2,891 4,964 Net interest income (expense) 46,554 44,881 3,184 (2,848 ) 91,771 Credit loss expense (benefit) (2,399 ) 1,164 38 10 (1,187 ) Net interest income after credit loss expense 48,953 43,717 3,146 (2,858 ) 92,958 Noninterest income 7,371 1,557 3,086 41 12,055 Noninterest expense 41,183 19,106 11,416 1,108 72,813 Operating income (loss) $ 15,141 $ 26,168 $ (5,184 ) $ (3,925 ) $ 32,200 Information pertaining to our factoring segment, which includes only factoring originated by our Triumph Business Capital subsidiary, summarized as of and for the quarters ended:
December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020Factored receivable period end balance $ 1,546,361,000 $ 1,479,989,000 $ 1,284,314,000 $ 1,118,988,000 $ 1,036,548,000 Yield on average receivable balance 14.42 % 13.75 % 14.99 % 13.85 % 13.80 % Current quarter charge-off rate(1) 0.01 % 0.24 % 0.04 % 3.95 % 0.02 % Factored receivables - transportation concentration 90 % 90 % 91 % 90 % 89 % Interest income, including fees $ 58,042,000 $ 47,222,000 $ 44,653,000 $ 35,824,000 $ 35,439,000 Non-interest income(2) 2,295,000 1,557,000 2,742,000 1,757,000 1,358,000 Factored receivable total revenue 60,337,000 48,779,000 47,395,000 37,581,000 36,797,000 Average net funds employed 1,442,551,000 1,235,610,000 1,072,405,000 936,528,000 924,899,000 Yield on average net funds employed 16.59 % 15.66 % 17.73 % 16.27 % 15.83 % Accounts receivable purchased $ 4,032,585,000 $ 3,531,811,000 $ 3,068,262,000 $ 2,492,468,000 $ 2,461,249,000 Number of invoices purchased 1,669,387 1,535,321 1,401,695 1,188,678 1,189,271 Average invoice size $ 2,416 $ 2,300 $ 2,189 $ 2,097 $ 2,070 Average invoice size - transportation $ 2,291 $ 2,195 $ 2,090 $ 1,974 $ 1,943 Average invoice size - non-transportation $ 5,648 $ 4,944 $ 4,701 $ 4,775 $ 5,091 (1) March 31, 2021 includes a $41.3 million charge-off related to the TFS acquisition, which contributed approximately 3.94% to the net charge-off rate for the quarter. (2) Total factoring segment non-interest income was $6.4 million and $15.5 million for the three months ended March 31, 2021 and December 31, 2020, respectively. March 31, 2021 non-interest income used to calculate yield on average net funds employed excludes a $4.7 million gain on our indemnification asset. December 31, 2020 non-interest income used to calculate yield on average net funds employed excludes a gain of $8.9 million related to CVLG’s delivery of proceeds resulting from the liquidation of its acquired stock and a $5.3 million gain on our indemnification asset. Information pertaining to our payments segment, which includes only our TriumphPay division, summarized as of and for the quarters ended:
December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020Factored receivable period end balance $ 153,176,000 $ 127,039,000 $ 113,985,000 $ 89,730,000 $ 84,222,000 Interest income $ 4,154,000 $ 3,295,000 $ 2,675,000 $ 1,969,000 $ 2,034,000 Noninterest income 3,209,000 3,086,000 1,083,000 73,000 51,000 Total revenue $ 7,363,000 $ 6,381,000 $ 3,758,000 $ 2,042,000 $ 2,085,000 Pre-tax operating income (loss) $ (5,997,000 ) $ (5,184,000 ) $ (7,441,000 ) $ (2,552,000 ) $ (2,026,000 ) Interest expense 94,000 111,000 139,000 167,000 178,000 Depreciation and software amortization expense 57,000 77,000 68,000 65,000 63,000 Intangible amortization expense 1,489,000 1,490,000 497,000 — — Earnings (losses) before interest, taxes, depreciation, and amortization $ (4,357,000 ) $ (3,506,000 ) $ (6,737,000 ) $ (2,320,000 ) $ (1,785,000 ) Transaction costs — — 2,992,000 — — Adjusted earnings (losses) before interest, taxes, depreciation, and amortization(1) $ (4,357,000 ) $ (3,506,000 ) $ (3,745,000 ) $ (2,320,000 ) $ (1,785,000 ) Number of invoices processed 4,027,680 3,760,948 3,165,119 2,529,673 1,818,145 Amount of payments processed $ 5,242,051,000 $ 4,191,424,000 $ 3,426,808,000 $ 2,301,632,000 $ 1,920,037,000 (1) Adjusted earnings (losses) before interest, taxes, depreciation, and amortization excludes material gains and expenses related to merger and acquisition-related activities and is a non-GAAP financial measure used to provide meaningful supplemental information regarding the segment's operational performance and to enhance investors' overall understanding of such financial performance by removing the volatility associated with certain acquisition-related items that are unrelated to our core business.
Deposits summarized as of:
(Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020Non-interest bearing demand $ 1,925,370 $ 2,020,984 $ 1,803,552 $ 1,637,653 $ 1,352,785 Interest bearing demand 830,019 795,234 760,874 729,364 688,680 Individual retirement accounts 83,410 86,012 87,052 89,748 92,584 Money market 520,358 472,242 395,035 402,070 393,325 Savings 504,146 483,946 474,163 464,035 421,488 Certificates of deposit 533,206 574,539 612,730 740,694 790,844 Brokered time deposits 40,125 117,064 306,975 516,006 516,786 Other brokered deposits 210,045 272,554 285,069 210,095 460,108 Total deposits $ 4,646,679 $ 4,822,575 $ 4,725,450 $ 4,789,665 $ 4,716,600 Net interest margin summarized for the three months ended:
December 31, 2021 September 30, 2021 (Dollars in thousands) Average
BalanceInterest Average
RateAverage
BalanceInterest Average
RateInterest earning assets: Interest earning cash balances $ 361,059 $ 141 0.15 % $ 474,122 $ 183 0.15 % Taxable securities 142,658 1,266 3.52 % 154,017 948 2.44 % Tax-exempt securities 26,691 172 2.56 % 27,839 178 2.54 % FHLB and other restricted stock 5,170 25 1.92 % 7,956 28 1.40 % Loans 4,851,171 106,175 8.68 % 4,777,409 95,398 7.92 % Total interest earning assets $ 5,386,749 $ 107,779 7.94 % $ 5,441,343 $ 96,735 7.05 % Non-interest earning assets: Other assets 593,013 579,288 Total assets $ 5,979,762 $ 6,020,631 Interest bearing liabilities: Deposits: Interest bearing demand $ 825,784 $ 486 0.23 % $ 779,625 $ 435 0.22 % Individual retirement accounts 84,966 115 0.54 % 86,571 126 0.58 % Money market 486,939 261 0.21 % 417,435 225 0.21 % Savings 493,796 190 0.15 % 479,915 185 0.15 % Certificates of deposit 550,746 647 0.47 % 595,001 725 0.48 % Brokered time deposits 33,263 9 0.11 % 99,116 29 0.12 % Other brokered deposits 299,290 199 0.26 % 441,446 223 0.20 % Total interest bearing deposits 2,774,784 1,907 0.27 % 2,899,109 1,948 0.27 % Federal Home Loan Bank advances 38,967 24 0.24 % 36,522 22 0.24 % Subordinated notes 106,847 1,297 4.82 % 114,071 2,449 8.52 % Junior subordinated debentures 40,530 444 4.35 % 40,390 443 4.35 % Other borrowings 62,143 50 0.32 % 127,946 102 0.32 % Total interest bearing liabilities $ 3,023,271 $ 3,722 0.49 % $ 3,218,038 $ 4,964 0.61 % Non-interest bearing liabilities and equity: Non-interest bearing demand deposits 2,022,973 1,912,398 Other liabilities 81,835 72,173 Total equity 851,683 818,022 Total liabilities and equity $ 5,979,762 $ 6,020,631 Net interest income $ 104,057 $ 91,771 Interest spread 7.45 % 6.44 % Net interest margin 7.66 % 6.69 % Loan balance totals include respective nonaccrual assets.
Net interest spread is the yield on average interest earning assets less the rate on interest bearing liabilities.
Net interest margin is the ratio of net interest income to average interest earning assets.
Average rates have been annualized.Additional information pertaining to our loan portfolio, including loans held for investment and loans held for sale, summarized for the quarters ended:
(Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020Average Banking loans $ 3,112,072 $ 3,299,152 $ 3,516,747 $ 3,722,895 $ 3,777,553 Average Factoring receivables 1,597,091 1,362,856 1,195,209 1,048,968 1,024,307 Average Payments receivables 142,008 115,401 102,094 76,412 74,947 Average total loans $ 4,851,171 $ 4,777,409 $ 4,814,050 $ 4,848,275 $ 4,876,807 Banking yield 5.61 % 5.40 % 5.25 % 5.31 % 5.34 % Factoring yield 14.42 % 13.75 % 14.99 % 13.85 % 13.80 % Payments Yield 11.61 % 11.33 % 10.51 % 10.45 % 10.80 % Total loan yield 8.68 % 7.92 % 7.77 % 7.24 % 7.20 % Metrics and non-GAAP financial reconciliation:
As of and for the Three Months Ended As of and for the Twelve
Months Ended(Dollars in thousands,
except per share amounts)December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020December 31,
2021December 31,
2020Net income available to common stockholders $ 25,839 $ 23,627 $ 27,180 $ 33,122 $ 31,328 $ 109,768 $ 62,323 Transaction costs — — 2,992 — — 2,992 827 Gain on sale of subsidiary or division — — — — — — (9,758 ) Tax effect of adjustments — — (715 ) — — (715 ) 2,254 Adjusted net income available to common stockholders - diluted $ 25,839 $ 23,627 $ 29,457 $ 33,122 $ 31,328 $ 112,045 $ 55,646 Weighted average shares outstanding - diluted 25,390,733 25,227,963 25,209,007 25,170,938 25,053,386 25,252,052 24,615,816 Adjusted diluted earnings per common share $ 1.02 $ 0.94 $ 1.17 $ 1.32 $ 1.25 $ 4.44 $ 2.26 Average total stockholders' equity $ 851,683 $ 818,022 $ 786,404 $ 746,849 $ 720,892 $ 801,074 $ 661,942 Average preferred stock liquidation preference (45,000 ) (45,000 ) (45,000 ) (45,000 ) (45,000 ) (45,000 ) (24,099 ) Average total common stockholders' equity 806,683 773,022 741,404 701,849 675,892 756,074 637,843 Average goodwill and other intangibles (278,528 ) (284,970 ) (220,310 ) (188,980 ) (191,017 ) (243,541 ) (190,088 ) Average tangible common stockholders' equity $ 528,155 $ 488,052 $ 521,094 $ 512,869 $ 484,875 $ 512,533 $ 447,755 Net income available to common stockholders $ 25,839 $ 23,627 $ 27,180 $ 33,122 $ 31,328 $ 109,768 $ 62,323 Average tangible common equity 528,155 488,052 521,094 512,869 484,875 512,533 447,755 Return on average tangible common equity 19.41 % 19.21 % 20.92 % 26.19 % 25.70 % 21.42 % 13.92 % Net interest income $ 104,057 $ 91,771 $ 90,282 $ 83,020 $ 83,598 $ 369,130 $ 284,728 Non-interest income 14,259 12,055 13,896 14,291 22,386 54,501 60,385 Operating revenue 118,316 103,826 104,178 97,311 105,984 423,631 345,113 Gain on sale of subsidiary or division — — — — — — (9,758 ) Adjusted operating revenue $ 118,316 $ 103,826 $ 104,178 $ 97,311 $ 105,984 $ 423,631 $ 335,355 Non-interest expenses $ 83,004 $ 72,813 $ 70,798 $ 60,892 $ 59,298 $ 287,507 $ 222,074 Transaction costs — — (2,992 ) — — (2,992 ) (827 ) Adjusted non-interest expenses $ 83,004 $ 72,813 $ 67,806 $ 60,892 $ 59,298 $ 284,515 $ 221,247 Adjusted efficiency ratio 70.16 % 70.13 % 65.09 % 62.57 % 55.95 % 67.16 % 65.97 % Adjusted net non-interest expense to average assets ratio: Non-interest expenses $ 83,004 $ 72,813 $ 70,798 $ 60,892 $ 59,298 $ 287,507 $ 222,074 Transaction costs — — (2,992 ) — — (2,992 ) (827 ) Adjusted non-interest expenses $ 83,004 $ 72,813 $ 67,806 $ 60,892 $ 59,298 $ 284,515 $ 221,247 Total non-interest income $ 14,259 $ 12,055 $ 13,896 $ 14,291 $ 22,386 $ 54,501 $ 60,385 Gain on sale of subsidiary or division — — — — — — (9,758 ) Adjusted non-interest income $ 14,259 $ 12,055 $ 13,896 $ 14,291 $ 22,386 $ 54,501 $ 50,627 Adjusted net non-interest expenses $ 68,745 $ 60,758 $ 53,910 $ 46,601 $ 36,912 $ 230,014 $ 170,620 Average total assets $ 5,979,762 $ 6,020,631 $ 6,093,805 $ 6,013,668 $ 5,788,549 $ 6,026,819 $ 5,426,469 Adjusted net non-interest expense to average assets ratio 4.56 % 4.00 % 3.55 % 3.14 % 2.54 % 3.82 % 3.14 % Total stockholders' equity $ 858,864 $ 820,674 $ 792,388 $ 764,004 $ 726,781 $ 858,864 $ 726,781 Preferred stock liquidation preference (45,000 ) (45,000 ) (45,000 ) (45,000 ) (45,000 ) (45,000 ) (45,000 ) Total common stockholders' equity 813,864 775,674 747,388 719,004 681,781 813,864 681,781 Goodwill and other intangibles (276,856 ) (280,055 ) (286,567 ) (188,006 ) (189,922 ) (276,856 ) (189,922 ) Tangible common stockholders' equity $ 537,008 $ 495,619 $ 460,821 $ 530,998 $ 491,859 $ 537,008 $ 491,859 Common shares outstanding 25,158,879 25,123,342 25,109,703 24,882,929 24,868,218 25,158,879 24,868,218 Tangible book value per share $ 21.34 $ 19.73 $ 18.35 $ 21.34 $ 19.78 $ 21.34 $ 19.78 Total assets at end of period $ 5,956,250 $ 6,024,535 $ 6,015,877 $ 6,099,628 $ 5,935,791 $ 5,956,250 $ 5,935,791 Goodwill and other intangibles (276,856 ) (280,055 ) (286,567 ) (188,006 ) (189,922 ) (276,856 ) (189,922 ) Tangible assets at period end $ 5,679,394 $ 5,744,480 $ 5,729,310 $ 5,911,622 $ 5,745,869 $ 5,679,394 $ 5,745,869 Tangible common stockholders' equity ratio 9.46 % 8.63 % 8.04 % 8.98 % 8.56 % 9.46 % 8.56 % 1) Triumph uses certain non-GAAP financial measures to provide meaningful supplemental information regarding Triumph's operational performance and to enhance investors' overall understanding of such financial performance. The non-GAAP measures used by Triumph include the following:
- “Adjusted diluted earnings per common share” is defined as adjusted net income available to common stockholders divided by adjusted weighted average diluted common shares outstanding. Excluded from net income available to common stockholders are material gains and expenses related to merger and acquisition-related activities, including divestitures, net of tax. In our judgment, the adjustments made to net income available to common stockholders allow management and investors to better assess our performance in relation to our core net income by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business. Weighted average diluted common shares outstanding are adjusted as a result of changes in their dilutive properties given the gain and expense adjustments described herein.
- "Tangible common stockholders' equity" is defined as common stockholders' equity less goodwill and other intangible assets.
- "Total tangible assets" is defined as total assets less goodwill and other intangible assets.
- "Tangible book value per share" is defined as tangible common stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.
- "Tangible common stockholders' equity ratio" is defined as the ratio of tangible common stockholders' equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets.
- "Return on Average Tangible Common Equity" is defined as net income available to common stockholders divided by average tangible common stockholders' equity.
- "Adjusted efficiency ratio" is defined as non-interest expenses divided by our operating revenue, which is equal to net interest income plus non-interest income. Also excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. In our judgment, the adjustments made to operating revenue and non-interest expense allow management and investors to better assess our performance in relation to our core operating revenue by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.
- "Adjusted net non-interest expense to average total assets" is defined as non-interest expenses net of non-interest income divided by total average assets. Excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. This metric is used by our management to better assess our operating efficiency.
2) Performance ratios include discount accretion on purchased loans for the periods presented as follows:
For the Three Months Ended For the Twelve Months Ended (Dollars in thousands) December 31,
2021September 30,
2021June 30,
2021March 31,
2021December 31,
2020December 31,
2021December 31,
2020Loan discount accretion $ 1,674 $ 1,953 $ 2,161 $ 3,501 $ 2,334 $ 9,289 $ 10,711 3) Asset quality ratios exclude loans held for sale, except for non-performing assets to total assets.
4) Current quarter ratios are preliminary.
Source: Triumph Bancorp, Inc.
Investor Relations:
Luke Wyse
Senior Vice President, Finance & Investor Relations
lwyse@tbkbank.com
214-365-6936Media Contact:
Amanda Tavackoli
Senior Vice President, Director of Corporate Communication
atavackoli@tbkbank.com
214-365-6930
