First Busey Announces Fourth Quarter and Full Year 2020 Earnings

Rhea-AI Summary

First Busey Corporation (Nasdaq: BUSE) reported a fourth quarter 2020 net income of $28.3 million with a diluted EPS of $0.52. Adjusted net income increased to $34.3 million and adjusted diluted EPS rose to $0.62, reflecting a year-over-year increase. Full-year net income reached $100.3 million and diluted EPS was $1.83. The tangible book value per share increased by 7.8% year-over-year. Wealth management assets under care grew to $10.23 billion at year-end 2020. A dividend of $0.23 per common share was declared for January 2021.

Positive

• Fourth quarter adjusted net income of $34.3 million, up 4.6% from the previous quarter.
• Full year 2020 net income reached $100.3 million, indicating strong financial performance.
• Tangible book value per common share increased 7.8% year-over-year to $16.66.
• Wealth management assets grew to $10.23 billion, up from $9.50 billion in the previous quarter.
• Dividend increased to $0.23 per common share, reflecting a nearly 5% rise from the previous dividend.

Negative

• Fourth quarter net income decreased compared to the third quarter, down from $30.8 million.
• Pre-provision net revenue declined to $38.5 million from $45.9 million in the prior quarter.
• Annualized return on average assets dropped to 1.08%, down from 1.31% on adjusted basis.

CHAMPAIGN, Ill., Jan. 26, 2021 (GLOBE NEWSWIRE) -- First Busey Corporation (Nasdaq: BUSE)

Message from our Chairman & CEO

Highlights of fourth quarter and full-year 2020 financial results:

• Fourth quarter 2020 net income of $28.3 million and diluted EPS of $0.52
• Fourth quarter 2020 adjusted net income¹ of $34.3 million and adjusted diluted EPS¹ of $0.62, an increase from $32.8 million and $0.60, respectively, in the third quarter of 2020, and $31.8 million and $0.57, respectively, in the fourth quarter of 2019
• Full year 2020 net income of $100.3 million and diluted EPS of $1.83
• Full year 2020 adjusted net income¹ of $108.7 million and adjusted diluted EPS¹ of $1.98
• Tangible book value per common share¹ of $16.66 at December 31, 2020, as compared to $16.32 at September 30, 2020, and $15.46 at December 31, 2019, an increase of 7.8% year-over-year
• Wealth management assets under care of $10.23 billion at December 31, 2020, up from $9.50 billion at September 30, 2020, and $9.70 billion at December 31, 2019

Other recent highlights:

• Completion of the previously announced branch consolidation plan
• Definitive agreement to acquire Cummins-American Corp., the holding company for Glenview State Bank
• Temporary relief via regulatory Interim Final Rule pronouncement on the interchange revenue impacts of the Durbin Amendment
• January 2021 dividend of $0.23 per common share, up from $0.22 in October 2020, which represents nearly a 5% increase
• For additional information, please refer to the 4Q20 Quarterly Earnings Supplement
  

Fourth Quarter Financial Results
Net income for First Busey Corporation (“First Busey” or the “Company”) for the fourth quarter of 2020 was $28.3 million, or $0.52 per diluted common share, as compared to $30.8 million, or $0.56 per diluted common share, for the third quarter of 2020 and $28.6 million, or $0.52 per diluted common share, for the fourth quarter of 2019.  Adjusted net income¹ for the fourth quarter of 2020 was $34.3 million, or $0.62 per diluted common share, as compared to $32.8 million, or $0.60 per diluted common share, for the third quarter of 2020 and $31.8 million, or $0.57 per diluted common share, for the fourth quarter of 2019. For the fourth quarter of 2020, annualized return on average assets and annualized return on average tangible common equity¹ were 1.08% and 12.58%, respectively.  Based on adjusted net income¹, annualized return on average assets was 1.31% and annualized return on average tangible common equity¹ was 15.21% for the fourth quarter of 2020.

Pre-provision net revenue¹ for the fourth quarter of 2020 was $38.5 million as compared to $45.9 million for the third quarter of 2020 and $37.5 million for the fourth quarter of 2019. Adjusted pre-provision net revenue¹ for the fourth quarter of 2020 was $47.2 million, as compared to $48.7 million for the third quarter of 2020 and $41.1 million for the fourth quarter of 2019. Annualized pre-provision net revenue to average assets¹ for the fourth quarter of 2020 was 1.47%, as compared to 1.71% for the third quarter of 2020 and 1.53% for the fourth quarter of 2019. Annualized adjusted pre-provision net revenue to average assets¹ for the fourth quarter of 2020 was 1.80%, as compared to 1.81% for the third quarter of 2020 and 1.68% for the fourth quarter of 2019.

¹ See “Non-GAAP Financial Information” below.

The Company views certain non-operating items, including acquisition-related and other restructuring charges, as adjustments to net income reported under U.S. generally accepted accounting principles (“GAAP”). Non-operating pretax adjustments for the fourth quarter of 2020 included $0.8 million of expenses related to acquisitions and $6.8 million of other restructuring costs. The Company believes that non-GAAP measures (including adjusted pre-provision net revenue, adjusted net income, adjusted diluted earnings per share, adjusted return on average assets, adjusted net interest margin, adjusted efficiency ratio, tangible common equity, tangible common equity to tangible assets, tangible book value per share and return on average tangible common equity), facilitate the assessment of its financial results and peer comparability. A reconciliation of these non-GAAP measures is included in tabular form at the end of this release.

In accordance with the Company’s previously announced plans, 12 banking centers were closed on October 23, 2020, as part of the Company’s efforts to ensure a balance between its physical banking center network and robust digital banking services while also optimizing operating efficiency. When fully realized, annualized expense savings net of expected associated revenue impacts are anticipated to be approximately $3.3 million. A significant majority of these cost savings began to be realized in the fourth quarter of 2020. Non-operating pretax expenses in salaries, wages and employee benefits in relation to the banking center closings were $0.6 million during the third quarter of 2020 and $0.1 million in the fourth quarter of 2020. Further, fixed asset impairment of $6.7 million was recorded during the fourth quarter of 2020 related to these banking centers.

On January 1, 2020, the Company adopted ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments,” commonly referenced as the Current Expected Credit Loss (“CECL”) model. Upon adoption of CECL, the Company recognized a $16.8 million increase in its allowance for credit losses, substantially attributable to the remaining loan fair value marks on prior acquisitions, and a $5.5 million increase in its reserve for unfunded commitments. Under accounting rules, the reserve for unfunded commitments is carried on the balance sheet in other liabilities rather than as a component of the allowance for credit losses. These one-time increases, net of tax, were $15.9 million and recorded as an adjustment to beginning retained earnings. Ongoing impacts of the CECL methodology will be dependent upon changes in economic conditions and forecasts, originated and acquired loan portfolio composition, credit performance trends, portfolio duration, and other factors. During the fourth quarter of 2020, the Company recorded provision for credit losses of $3.1 million, primarily as a result of economic factors and continued uncertainty due to

FAQ

What was First Busey Corporation's fourth quarter 2020 net income?

First Busey Corporation reported a fourth quarter 2020 net income of $28.3 million.

What is the diluted EPS for First Busey Corporation for Q4 2020?

The diluted EPS for Q4 2020 was $0.52.

How much did First Busey Corporation's tangible book value per share increase?

Tangible book value per common share increased by 7.8% to $16.66.

What was the dividend declared by First Busey Corporation for January 2021?

The dividend declared for January 2021 was $0.23 per common share.

What were the total wealth management assets for First Busey Corporation?

Total wealth management assets under care reached $10.23 billion at the end of 2020.