BANCFIRST CORPORATION REPORTS FIRST QUARTER EARNINGS

Rhea-AI Summary

BancFirst Corporation (NASDAQ GS:BANF) reported a significant net income of $57.5 million, or $1.72 diluted earnings per share for Q1 2023, up from $35.9 million or $1.08 per share in Q1 2022. The net interest income soared to $109.2 million compared to $75.5 million a year earlier, driven by rising short-term interest rates and loan growth, leading to a net interest margin of 3.89%. Noninterest income also grew, totaling $47.8 million. Despite a rise in noninterest expenses to $80.3 million, largely from increased salaries, the Company maintained asset quality with nonaccrual loans at only 0.25% of total loans. Total assets slightly decreased to $12.3 billion, while total stockholders' equity improved to $1.3 billion.

Positive

• Net income increased to $57.5 million, or $1.72 EPS, from $35.9 million, or $1.08 EPS in Q1 2022.
• Net interest income rose to $109.2 million, up from $75.5 million year-over-year.
• Net interest margin improved to 3.89%, compared to 2.78% last year.
• Noninterest income increased to $47.8 million from $43.7 million.
• Total stockholders' equity rose by $60.0 million to $1.3 billion.

Negative

• Noninterest expenses increased to $80.3 million from $72.5 million, primarily due to salary increases.
• Total assets slightly decreased by $55.8 million from December 31, 2022.

OKLAHOMA CITY, April 25, 2023 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS:BANF) reported net income of $57.5 million, or $1.72 diluted earnings per share, for the first quarter of 2023 compared to net income of $35.9 million, or $1.08 diluted earnings per share, for the first quarter of 2022. The Company's net interest income for the first quarter of 2023 increased to $109.2 million compared to $75.5 million for the quarter ended March 31, 2022. Rising short-term interest rates and loan growth drove the increase. The net interest margin for the quarter was 3.89% compared to 2.78% a year ago. For the first quarter of 2023, the Company recorded a provision for credit losses of $2.3 million, compared to $2.9 million for the first quarter of 2022.

Noninterest income for the quarter totaled $47.8 million, compared to $43.7 million last year. The increase in noninterest income was mostly attributable to an increase in sweep fees due to rising interest rates and higher volume, along with a $1.3 million increase in insurance commissions. Noninterest income for the first quarter included $327,000 of income from an equity interest received from a prior loan settlement compared to $4.9 million of income from the same source in the first quarter of 2022. In addition, the first quarter of 2022 included a loss of $4.0 million on the sale of $226 million of low yielding securities, which were subsequently reinvested at higher yields.

Noninterest expense for the quarter increased to $80.3 million compared to $72.5 million last year. The increase in noninterest expense was primarily related to an increase in salaries and employee benefits of $5.3 million. The first quarter of 2022 included a gain on sale of OREO which reduced noninterest expense by $726,000.

The Company's effective tax rate for the period was 22.6% compared to 17.8% for the first quarter of 2022. During the quarter, the Company adopted ASU 2023-02 which required a reclassification of $977,000 from other expense to income tax expense. The lower effective tax rate in 2022 was also driven by the exercising of stock options during the quarter and a lower state income tax rate.

At March 31, 2023, the Company's total assets were $12.3 billion, a decrease of $55.8 million from December 31, 2022. Debt securities of $1.6 billion were up $77.6 million from December 31, 2022. Loans totaled $7.1 billion, an increase of $175.0 million from December 31, 2022. Deposits totaled $10.6 billion, a decrease of $364.1 million from December 31, 2022 as deposits moved into the Company's off balance sheet sweep product. Sweep accounts were $4.1 billion at March 31, 2023 up $394.9 million from December 31, 2022. The Company's total stockholders' equity was $1.3 billion, an increase of $60.0 million over December 31, 2022.

Asset quality remained strong as nonaccrual loans totaled $17.6 million, representing only 0.25% of total loans at March 31, 2023 compared to 0.22% at year-end 2022. The allowance for credit losses to total loans was 1.33% at both March 31, 2023 and December 31, 2022. Net charge-offs were minimal for both the first quarter of 2023 and 2022.

BancFirst Corporation CEO David Harlow commented, "While we were pleased with our first quarter results, our industry is facing growing challenges including the possibility of a recession.  However, we feel the Company is as well positioned to navigate these headwinds as any bank in the country. Top-tier liquidity supported by community based deposits, strong capital, and solid credit quality will allow us to continue to do what we have always done – focus on and support our customers and the communities that we serve."

BancFirst Corporation (the Company) is an Oklahoma based financial services holding company. The Company operates three subsidiary banks, BancFirst, an Oklahoma state-chartered bank with 106 banking locations serving 59 communities across Oklahoma, Pegasus Bank, with 3 banking locations in the Dallas Metroplex area and Worthington Bank with 4 locations in the Dallas-Fort Worth Metroplex area. More information can be found at www.bancfirst.bank.

The Company may make forward-looking statements within the meaning of Section 27A of the securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 with respect to earnings, credit quality, corporate objectives, interest rates and other financial and business matters. Forward-looking statements include estimates and give management's current expectations or forecasts of future events.  The Company cautions readers that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, including economic conditions, the performance of financial markets and interest rates; legislative and regulatory actions and reforms; competition; as well as other factors, all of which change over time.  Actual results may differ materially from forward-looking statements.

 

BancFirst Corporation
Summary Financial Information
(Dollars in thousands, except per share and share data - Unaudited)
		2023		2022		2022		2022		2022
		1st Qtr		4th Qtr		3rd Qtr		2nd Qtr		1st Qtr
Condensed Income Statements:
Net interest income		$                 109,156		$                 110,352		$                 100,947		$                   86,867		$                   75,507
Provision for credit losses		2,322		3,776		2,863		501		2,936
Noninterest income:
Trust revenue		4,222		4,065		4,125		3,949		3,506
Service charges on deposits		21,231		21,603		22,161		21,618		21,375
Securities transactions		(213)		1,116		966		-		(3,915)
Income from sales of loans		604		657		969		1,256		1,666
Insurance commissions		8,741		6,656		7,498		5,302		7,427
Cash management		6,734		6,124		5,624		4,447		3,131
Other		6,509		7,947		7,988		6,026		10,460
Total noninterest income		47,828		48,168		49,331		42,598		43,650
Noninterest expense:
Salaries and employee benefits		49,252		48,019		47,741		45,284		43,932
Occupancy expense, net		4,983		5,259		4,930		4,734		4,403
Depreciation		4,643		4,566		4,612		4,647		4,775
Amortization of intangible assets		880		880		880		857		831
Data processing services		2,107		1,928		1,876		1,975		1,805
Net expense (income) from other real estate owned		2,459		6,235		2,392		(510)		1,794
Marketing and business promotion		2,527		2,465		1,945		1,591		2,073
Deposit insurance		1,613		1,209		1,202		1,196		1,128
Other		11,853		14,044		13,500		13,943		11,771
Total noninterest expense		80,317		84,605		79,078		73,717		72,512
Income before income taxes		74,345		70,139		68,337		55,247		43,709
Income tax expense		16,812		13,013		12,985		10,540		7,794
Net income		$                   57,533		$                   57,126		$                   55,352		$                   44,707		$                   35,915
Per Common Share Data:
Net income-basic		$                       1.75		$                       1.74		$                       1.69		$                       1.36		$                       1.10
Net income-diluted		1.72		1.70		1.65		1.34		1.08
Cash dividends declared		0.40		0.40		0.40		0.36		0.36
Common shares outstanding		32,899,493		32,875,560		32,856,387		32,781,198		32,725,587
Average common shares outstanding -
Basic		32,892,857		32,868,087		32,825,931		32,749,752		32,666,916
Diluted		33,462,379		33,503,937		33,536,558		33,418,482		33,315,333
Performance Ratios:
Return on average assets		1.90 %		1.82 %		1.75 %		1.42 %		1.22 %
Return on average stockholders' equity		18.31		18.62		18.13		15.14		12.33
Net interest margin		3.89		3.83		3.48		3.05		2.78
Efficiency ratio		51.16		53.37		52.62		56.94		60.85

 

	BancFirst Corporation
	Summary Financial Information
	(Dollars in thousands, except per share and share data - Unaudited)
			2023		2022		2022		2022		2022
			1st Qtr		4th Qtr		3rd Qtr		2nd Qtr		1st Qtr
	Balance Sheet Data:
	Total assets		$  12,332,105		$  12,387,863		$  12,452,378		$  12,530,073		$  12,624,431
	Interest-bearing deposits with banks		2,623,565		2,909,861		3,106,279		3,590,311		3,816,532
	Debt securities		1,618,233		1,540,604		1,521,645		1,205,894		1,211,668
	Total loans		7,124,831		6,949,795		6,832,595		6,620,643		6,504,477
	Allowance for credit losses		(94,760)		(92,728)		(89,871)		(86,935)		(87,239)
	Deposits		10,610,103		10,974,228		11,058,940		11,142,688		11,250,971
	Stockholders' equity		1,310,882		1,250,836		1,195,149		1,185,695		1,167,802
	Book value per common share		39.85		38.05		36.37		36.17		35.68
	Tangible book value per common share (non-GAAP)(1)		33.73		31.90		30.20		29.90		29.51
	Balance Sheet Ratios:
	Average loans to deposits		64.54 %		62.25 %		59.62 %		58.66 %		59.72 %
	Average earning assets to total assets		92.52		92.14		91.58		90.89		91.92
	Average stockholders' equity to average assets		10.36		9.80		9.63		9.40		9.86
	Asset Quality Data:
	Past due loans		$          7,258		$          7,085		$          3,167		$          4,771		$          6,360
	Nonaccrual loans (3)		17,649		15,299		11,962		13,712		17,453
	Other real estate owned and repossessed assets		38,874		36,936		39,419		39,209		39,729
	Nonaccrual loans to total loans		0.25 %		0.22 %		0.18 %		0.21 %		0.27 %
	Allowance to total loans		1.33		1.33		1.32		1.31		1.34
	Allowance to nonaccrual loans		536.93		606.10		751.32		634.01		499.83
	Net charge-offs to average loans		0.00		0.01		0.00		0.01		0.00
	Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(2):
	Stockholders' equity		$   1,310,882		$   1,250,836		$   1,195,149		$   1,185,695		$   1,167,802
	Less goodwill		182,055		182,055		182,055		183,639		176,563
	Less intangible assets, net		19,103		19,983		20,863		21,743		25,456
	Tangible stockholders' equity (non-GAAP)		$   1,109,724		$   1,048,798		$      992,231		$      980,313		$      965,783
	Common shares outstanding		32,899,493		32,875,560		32,856,387		32,781,198		32,725,587
	Tangible book value per common share (non-GAAP)		$          33.73		$          31.90		$          30.20		$          29.90		$          29.51

 

	(1)     Refer to the "Reconciliation of Tangible Book Value per Common Share (non-GAAP)" Table.
	(2)     Tangible book value per common share is stockholders' equity less goodwill and intangible assets, net, divided by common shares outstanding. This amount is a non-GAAP financial measure but has been included as it is considered to be a critical metric with which to analyze and evaluate the financial condition and capital strength of the Company. This measure should not be considered a substitute for operating results determined in accordance with GAAP.
	(3) Government Agencies guarantee approximately $6.4 million of nonaccrual loans at March 31, 2023.

 

 

BancFirst Corporation
Consolidated Average Balance Sheets
And Interest Margin Analysis
Taxable Equivalent Basis
(Dollars in thousands - Unaudited)
		Three Months Ended
		March 31, 2023
				Interest		Average
		Average		Income/		Yield/
		Balance		Expense		Rate
ASSETS
Earning assets:
Loans		$        7,005,731		$           104,481		6.05	%
Debt securities – taxable		1,572,278		8,991		2.32
Debt securities – tax exempt		3,481		9		1.07
Interest bearing deposits with banks and FFS		2,799,540		32,052		4.64
Total earning assets		11,381,030		145,533		5.19
Nonearning assets:
Cash and due from banks		218,164
Interest receivable and other assets		795,316
Allowance for credit losses		(93,316)
Total nonearning assets		920,164
Total assets		$       12,301,194
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest bearing liabilities:
Transaction deposits		$           927,265		$               1,632		0.71	%
Savings deposits		4,424,063		30,491		2.80
Time deposits		705,787		3,054		1.76
Short-term borrowings		6,844		83		4.94
Subordinated debt		86,049		1,030		4.86
Total interest bearing liabilities		6,150,008		36,290		2.39
Interest free funds:
Noninterest bearing deposits		4,797,014
Interest payable and other liabilities		79,735
Stockholders' equity		1,274,437
Total interest free  funds		6,151,186
Total liabilities and stockholders' equity		$       12,301,194
Net interest income				$           109,243
Net interest spread						2.80	%
Effect of interest free funds						1.09	%
						3.89	%

 

 

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SOURCE BancFirst

FAQ

What were BancFirst's earnings for Q1 2023?

BancFirst reported net income of $57.5 million, or $1.72 diluted earnings per share for Q1 2023.

How did net interest income change for BancFirst in Q1 2023?

Net interest income increased to $109.2 million in Q1 2023, up from $75.5 million in Q1 2022.

What was the growth in noninterest income for BancFirst in Q1 2023?

Noninterest income rose to $47.8 million in Q1 2023, compared to $43.7 million in the previous year.

What is BancFirst's outlook regarding economic challenges?

CEO David Harlow acknowledged industry challenges, including potential recession risks but expressed confidence in the Company's positioning to navigate these headwinds.