First Financial Bancorp Announces First Quarter 2021 Financial Results

Rhea-AI Summary

First Financial Bancorp (FFBC) reported a net income of $47.3 million, or $0.48 per diluted share, for Q1 2021, slightly down from $48.3 million in Q4 2020. Adjusted earnings per share stood at $0.50. The return on average assets was 1.20%, while the adjusted return was 1.24%. The net interest margin was 3.40%. A provision for credit losses of $4 million reflects a $7.5 million drop from the prior quarter. The company repurchased 840,115 shares, highlighting strong capital ratios. Despite challenges, optimism remains as economic conditions improve.

Positive

• Net income of $47.3 million for Q1 2021, $0.48 per diluted share.
• Adjusted earnings per share of $0.50.
• Return on average assets of 1.20%, adjusted return of 1.24%.
• Net interest margin of 3.40%.
• Provision for credit losses decreased to $4 million from $11.5 million in Q4 2020.
• Repurchased 840,115 shares during the quarter.

Negative

• Net income decreased $1 million from Q4 2020.
• Loan balances declined slightly, indicating muted demand.
• Classified assets increased during the quarter.

CINCINNATI, April 22, 2021 /PRNewswire/ -- 

• Earnings per diluted share of $0.48; $0.50 on an adjusted⁽¹⁾ basis
• Return on average assets of 1.20%; 1.24% as adjusted⁽¹⁾
• Net interest margin FTE⁽¹⁾ of 3.40%
• Provision for credit losses of $4.0 million; $7.5 million decline from linked quarter
• Repurchased 840,115 shares during the quarter

First Financial Bancorp. (Nasdaq: FFBC) ("First Financial" or the "Company") announced financial results for the three months ended March 31, 2021. 

For the three months ended March 31, 2021, the Company reported net income of $47.3 million, or $0.48 per diluted common share.  These results compare to net income of $48.3 million, or $0.49 per diluted common share, for the fourth quarter of 2020 and $28.6 million, or $0.29 per diluted common share, for the first quarter of 2020.

Return on average assets for the first quarter of 2021 was 1.20% while return on average tangible common equity was 15.24%.  These compare to returns on average assets of 1.20% and 0.79%, and returns on average tangible common equity of 15.50% and 9.71%, in the fourth quarter of 2020 and the first quarter of 2020, respectively.

First quarter 2021 highlights include:

• After adjustments⁽¹⁾ for certain nonrecurring items:
• Net income of $0.50 per diluted common share
• 1.24% return on average assets
• 15.80% return on average tangible common equity
• Net interest margin of 3.40% on a fully tax-equivalent basis⁽¹⁾ in line with expectations
• 9 basis point reduction from linked quarter driven by fewer fees related to loan prepayments, and lower volume of PPP forgiveness
• Noninterest income of $40.3 million, or $40.2 million as adjusted⁽¹⁾
• Foreign exchange income of $10.8 million remains strong despite decline from record fourth quarter
• Mortgage income of $9.5 million in line with expectations given expected seasonal declines and lower premiums
• Noninterest expenses of $92.5 million, or $90.0 million as adjusted⁽¹⁾
• Adjustments⁽¹⁾ include:
• $1.3 million of severance related costs
• $1.3 million of other nonrecurring costs such as branch consolidation costs
• Efficiency ratio of 60.0%; 58.4% as adjusted⁽¹⁾
• Excluding PPP growth, loan balances declined slightly during the quarter driven primarily by a decline in consumer and mortgage loans
• Average transactional deposit balances grew $523.7 million compared to the linked quarter; 21.1% on an annualized basis

 

(1) Financial information in this release that is described as "adjusted" or that is presented on a fully tax equivalent basis is non-GAAP.  For details on the calculation of these non-GAAP financial measures and a reconciliation to the GAAP financial measure, see the sections titled "Use of Non-GAAP Financial Measures" in this release and "Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slide presentation.

 

• Total Allowance for Credit Losses of $183.0 million; Total quarterly provision for credit losses of $4.0 million
• Loans and leases - ACL of $169.9 million, 1.71% of total loans; 1.84% of loans excluding PPP
• Unfunded Commitments - ACL of $13.0 million
• First quarter provision expense driven by net charge-offs, partially offset by improvements in economic conditions
• Strong capital ratios
• Total capital of 15.41%
• Tier 1 common equity of 11.81%
• Tangible common equity of 8.22%; 8.62% excluding PPP loans
• Tangible book value per share of $12.78; $0.15 decrease compared to linked quarter
• Repurchased 840,115 shares during first quarter

Archie Brown, President and Chief Executive Officer, remarked, "While uncertainty remains due to the ongoing pandemic, the accelerated COVID-19 vaccine distribution, unprecedented fiscal stimulus, and an accommodative Federal Reserve have led to widespread optimism for our economy, which is in stark contrast to our sentiment at this time last year.  Our first quarter operating performance reflects this change in sentiment and we have renewed optimism as a result of the improved business climate, despite an operating environment that presents challenges due to very low interest rates and muted loan demand."

Mr. Brown continued, "Our first quarter financial results once again reflect our earnings power and our consistent ability to deliver value to our shareholders.  Our core quarterly financial metrics remained strong with adjusted⁽¹⁾ earnings per share of $0.50, adjusted⁽¹⁾ return on assets of 1.24%, and an adjusted⁽¹⁾ efficiency ratio of 58.4%.  Net income was bolstered by  lower expenses and significantly lower credit costs.  Despite expected seasonal declines, noninterest income was strong due to healthy mortgage demand, robust foreign exchange activity and higher wealth management fees.  In addition, adjusted⁽¹⁾ noninterest expenses declined $4.6 million from the linked quarter and resulted in a sub-60% efficiency ratio.  As I mentioned, credit costs were low with $4.0 million of provision expense during the quarter, and resulted in an allowance for credit losses of 1.84% of total loans, excluding PPP.  Classified assets increased during the quarter, however our overall credit outlook has improved significantly and our borrowers are seeing benefits from the various stimulus actions.  While first quarter net charge-offs increased slightly from previous quarters, this was driven by a single customer relationship.  Given our overall credit outlook, we expect the allowance for credit losses to continue to decline over the course of 2021." 

Mr. Brown commented on balance sheet trends and capital utilization, "Excluding PPP activity, loan balances declined slightly for the quarter due to accelerated mortgage and HELOC payoffs, increased borrower liquidity, and muted business loan demand.  As a result of these trends, we anticipate slower growth in the near-term, with some acceleration in the second half of the year.  As of March 31, consumers and businesses were holding record levels of deposits, with average balances increasing during the quarter as a result of the stimulus package approved by Congress last December.  We anticipate further deposit balance growth in the second quarter after the passage of the most recent stimulus bill.  This anticipated growth will likely suppress loan demand and service charge income in the near-term.  From a capital standpoint, our ratios remained strong through the first quarter.  The combination of our current capital levels and our improved credit outlook, prompted us to repurchase 840,115 shares during the quarter.  Absent higher priority capital deployment alternatives, we anticipate additional buyback activity in the second quarter."

Mr. Brown concluded, "We are pleased with our improved performance and outlook from this time last year.  We have started to transition associates back into their physical office locations, and we look forward to implementing the lessons learned over the past year to create an efficient, safe, and collaborative workplace.  As our local and national economies continue to improve, we believe we are well positioned to deliver industry leading services to our clients and returns to our shareholders."

Full detail of the Company's first quarter 2021 performance is provided in the accompanying financial statements and slide presentation.

Teleconference / Webcast Information
First Financial's executive management will host a conference call to discuss the Company's financial and operating results on Friday, April 23, 2021 at 8:30 a.m. Eastern Time.  Members of the public who would like to listen to the conference call should dial (877) 506-6873 (U.S. toll free), (855) 669-9657 (Canada toll free) or +1 (412) 380-2003 (International) (no passcode required).  The number should be dialed five to ten minutes prior to the start of the conference call.  The conference call will also be accessible as an audio webcast via the Investor Relations section of the Company's website at www.bankatfirst.com.  A replay of the conference call will be available beginning one hour after the completion of the live call at (877) 344-7529 (U.S. toll free), (855) 669-9658 (Canada toll free) and +1 (412) 317-0088 (International); conference number 10154329.  The webcast will be archived on the Investor Relations section of the Company's website for 12 months.

Press Release and Additional Information on Website
This press release as well as supplemental information are available to the public through the Investor Relations section of First Financial's website at www.bankatfirst.com.

Use of Non-GAAP Financial Measures
This earnings release contains GAAP financial measures and Non-GAAP financial measures where management believes it to be helpful in understanding the Company's results of operations or financial position.  Where Non-GAAP financial measures are used, the comparable GAAP financial measures, as well as a reconciliation to the comparable GAAP financial measure, can be found in the section titled "Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slide presentation.

Forward-Looking Statement

Certain statements contained in this report which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Words such as ''believes,'' ''anticipates,'' "likely," "expected," "estimated," ''intends'' and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.  Examples of forward-looking statements include, but are not limited to, statements we make about (i) our future operating or financial performance, including revenues, income or loss and earnings or loss per share, (ii) future common stock dividends, (iii) our capital structure, including future capital levels, (iv) our plans, objectives and strategies, and (v) the assumptions that underlie our forward-looking statements.

As with any forecast or projection, forward-looking statements are subject to inherent uncertainties, risks and changes in circumstances that may cause actual results to differ materially from those set forth in the forward-looking statements.  Forward-looking statements are not historical facts but instead express only management's beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management's control. It is possible that actual results and outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements.  Important factors that could cause actual results to differ materially from those in our forward-looking statements include the following, without limitation:

• economic, market, liquidity, credit, interest rate, operational and technological risks associated with the Company's business;
• future credit quality and performance, including our expectations regarding future loan losses and our allowance for credit losses
• the effect of and changes in policies and laws or regulatory agencies, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and other legislation and regulation relating to the banking industry;
• Management's ability to effectively execute its business plans;
• mergers and acquisitions, including costs or difficulties related to the integration of acquired companies;
• the possibility that any of the anticipated benefits of the Company's acquisitions will not be realized or will not be realized within the expected time period;
• the effect of changes in accounting policies and practices;
• changes in consumer spending, borrowing and saving and changes in unemployment;
• changes in customers' performance and creditworthiness;
• the costs and effects of litigation and of unexpected or adverse outcomes in such litigation;
• current and future economic and market conditions, including the effects of declines in housing prices, high unemployment rates, U.S. fiscal debt, budget and tax matters, geopolitical matters, and any slowdown in global economic growth;
• the adverse impact on the U.S. economy, including the markets in which we operate, of the novel coronavirus, which causes the Coronavirus disease 2019 ("COVID-19"), global pandemic, and the impact of a slowing U.S. economy and increased unemployment on the performance of our loan and lease portfolio, the market value of our investment securities, the availability of sources of funding and the demand for our products;
• our capital and liquidity requirements (including under regulatory capital standards, such as the Basel III capital standards) and our ability to generate capital internally or raise capital on favorable terms;
• financial services reform and other current, pending or future legislation or regulation that could have a negative effect on our revenue and businesses, including the Dodd-Frank Act and other legislation and regulation relating to bank products and services;
• the effect of the current interest rate environment or changes in interest rates or in the level or composition of our assets or liabilities on our net interest income, net interest margin and our mortgage originations, mortgage servicing rights and mortgage loans held for sale;
• the effect of a fall in stock market prices on our brokerage, asset and wealth management businesses;
• a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber attacks;
• the effect of changes in the level of checking or savings account deposits on our funding costs and net interest margin; and
• our ability to develop and execute effective business plans and strategies.

Additional factors that may cause our actual results to differ materially from those described in our forward-looking statements can be found in our Form 10-K for the year ended December 31, 2020, as well as our other filings with the SEC, which are available on the SEC website at www.sec.gov. 

All forward-looking statements included in this filing are made as of the date hereof and are based on information available at the time of the filing.  Except as required by law, the Company does not assume any obligation to update any forward-looking statement.

About First Financial Bancorp.
First Financial Bancorp. is a Cincinnati, Ohio based bank holding company.  As of March 31, 2021, the Company had $16.2 billion in assets, $9.9 billion in loans, $12.6 billion in deposits and $2.3 billion in shareholders' equity.  The Company's subsidiary, First Financial Bank, founded in 1863, provides banking and financial services products through its six lines of business: Commercial, Retail Banking, Investment Commercial Real Estate, Mortgage Banking, Commercial Finance and Wealth Management.  These business units provide traditional banking services to business and retail clients.  Wealth Management provides wealth planning, portfolio management, trust and estate, brokerage and retirement plan services and had approximately $3.1 billion in assets under management as of March 31, 2021.  The Company operated 143 full service banking centers as of March 31, 2021, primarily in Ohio, Indiana, Kentucky and Illinois, while the Commercial Finance business lends into targeted industry verticals on a nationwide basis.  Additional information about the Company, including its products, services and banking locations, is available at www.bankatfirst.com.

 

FIRST FINANCIAL BANCORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Dollars in thousands, except per share data)
(Unaudited)
	Three Months Ended,
	Mar. 31,				Dec. 31,				Sep. 30,				June 30,				Mar. 31,
	2021				2020				2020				2020				2020
RESULTS OF OPERATIONS
Net income	$	47,315			$	48,312			$	41,477			$	37,393			$	28,628
Net earnings per share - basic	$	0.49			$	0.50			$	0.43			$	0.38			$	0.29
Net earnings per share - diluted	$	0.48			$	0.49			$	0.42			$	0.38			$	0.29
Dividends declared per share	$	0.23			$	0.23			$	0.23			$	0.23			$	0.23
KEY FINANCIAL RATIOS
Return on average assets	1.20		%		1.20		%		1.04		%		0.96		%		0.79		%
Return on average shareholders' equity	8.44		%		8.52		%		7.40		%		6.88		%		5.21		%
Return on average tangible shareholders' equity	15.24		%		15.50		%		13.61		%		12.90		%		9.71		%
Net interest margin	3.35		%		3.45		%		3.32		%		3.38		%		3.71		%
Net interest margin (fully tax equivalent) (1)	3.40		%		3.49		%		3.36		%		3.44		%		3.77		%
Ending shareholders' equity as a percent of ending assets	13.97		%		14.29		%		14.11		%		13.99		%		14.47		%
Ending tangible shareholders' equity as a percent of:
Ending tangible assets	8.22		%		8.47		%		8.25		%		8.09		%		8.25		%
Risk-weighted assets	11.02		%		11.29		%		11.07		%		10.89		%		10.50		%
Average shareholders' equity as a percent of average assets	14.17		%		14.07		%		14.08		%		13.91		%		15.21		%
Average tangible shareholders' equity as a percent of
average tangible assets	8.38		%		8.26		%		8.18		%		7.94		%		8.79		%
Book value per share	$	23.16			$	23.28			$	22.94			$	22.66			$	22.25
Tangible book value per share	$	12.78			$	12.93			$	12.56			$	12.26			$	11.82
Common equity tier 1 ratio (2)	11.81		%		11.82		%		11.63		%		11.49		%		11.27		%
Tier 1 ratio (2)	12.19		%		12.20		%		12.02		%		11.87		%		11.66		%
Total capital ratio (2)	15.41		%		15.55		%		15.37		%		15.19		%		13.54		%
Leverage ratio (2)	9.34		%		9.55		%		9.55		%		8.98		%		9.49		%
AVERAGE BALANCE SHEET ITEMS
Loans (3)	$	9,951,855			$	10,127,881			$	10,253,392			$	10,002,379			$	9,220,643
Investment securities	3,782,993				3,403,839				3,162,832				3,164,243				3,115,723
Interest-bearing deposits with other banks	46,912				143,884				40,277				91,990				39,332
Total earning assets	$	13,781,760			$	13,675,604			$	13,456,501			$	13,258,612			$	12,375,698
Total assets	$	16,042,654			$	16,030,986			$	15,842,010			$	15,710,204			$	14,524,422
Noninterest-bearing deposits	$	3,840,046			$	3,720,417			$	3,535,432			$	3,335,866			$	2,643,240
Interest-bearing deposits	8,531,822				8,204,306				8,027,082				8,395,229				7,590,791
Total deposits	$	12,371,868			$	11,924,723			$	11,562,514			$	11,731,095			$	10,234,031
Borrowings	$	886,379			$	1,307,461			$	1,519,748			$	1,272,819			$	1,735,767
Shareholders' equity	$	2,272,749			$	2,256,062			$	2,230,422			$	2,185,865			$	2,209,733
CREDIT QUALITY RATIOS
Allowance to ending loans	1.71		%		1.77		%		1.65		%		1.56		%		1.55		%
Allowance to nonaccrual loans	199.33		%		217.55		%		216.28		%		233.74		%		296.51		%
Allowance to nonperforming loans	175.44		%		199.97		%		196.69		%		208.06		%		203.42		%
Nonperforming loans to total loans	0.97		%		0.89		%		0.84		%		0.75		%		0.76		%
Nonperforming assets to ending loans, plus OREO	0.98		%		0.90		%		0.86		%		0.77		%		0.78		%
Nonperforming assets to total assets	0.60		%		0.56		%		0.55		%		0.49		%		0.48		%
Classified assets to total assets	1.22		%		0.89		%		0.84		%		0.79		%		0.83		%
Net charge-offs to average loans (annualized)	0.38		%		0.26		%		0.21		%		0.12		%		(0.04)		%

(1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 21% tax rate.  Management believes that it is a standard practice in the banking industry to present net interest margin and net interest income on a fully tax equivalent basis.  Therefore, management believes these measures provide useful information to investors by allowing them to make peer comparisons.  Management also uses these measures to make peer comparisons.
(2) March 31, 2021 regulatory capital ratios are preliminary.
(3)  Includes loans held for sale.

 

FIRST FINANCIAL BANCORP.
CONSOLIDATED QUARTERLY STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(Unaudited)
	2021				2020
	First				Fourth				Third				Second				First				Full
	Quarter				Quarter				Quarter				Quarter				Quarter				Year
Interest income
Loans and leases, including fees	$	98,931			$	106,733			$	103,249			$	105,900			$	115,775			$	431,657
Investment securities
Taxable	18,607				18,402				17,906				18,476				19,005				73,789
Tax-exempt	5,043				4,839				4,884				4,937				4,582				19,242
Total investment securities interest	23,650				23,241				22,790				23,413				23,587				93,031
Other earning assets	28				55				31				47				142				275
Total interest income	122,609				130,029				126,070				129,360				139,504				524,963
Interest expense
Deposits	4,333				5,920				7,886				11,751				16,365				41,922
Short-term borrowings	67				30				51				1,274				5,087				6,442
Long-term borrowings	4,333				5,606				5,953				4,759				3,770				20,088
Total interest expense	8,733				11,556				13,890				17,784				25,222				68,452
Net interest income	113,876				118,473				112,180				111,576				114,282				456,511
Provision for credit losses-loans and leases	3,450				13,758				15,299				17,859				23,880				70,796
Provision for credit losses-unfunded commitments	538				(2,250)				(1,925)				2,370				1,568				(237)
Net interest income after provision for credit losses	109,888				106,965				98,806				91,347				88,834				385,952
Noninterest income
Service charges on deposit accounts	7,146				7,654				7,356				6,001				8,435				29,446
Trust and wealth management fees	4,398				4,093				3,855				4,114				4,469				16,531
Bankcard income	3,128				3,060				3,124				2,844				2,698				11,726
Client derivative fees	1,556				2,021				2,203				2,984				3,105				10,313
Foreign exchange income	10,757				12,305				10,530				6,576				9,966				39,377
Net gains from sales of loans	9,454				13,089				18,594				16,662				2,831				51,176
Net gains (losses) on sale of investment securities	(166)				4,618				2				2				(59)				4,563
Unrealized  gain (loss) on equity  securities	112				8,975				18				150				(98)				9,045
Other	3,937				5,700				3,817				3,392				4,037				16,946
Total noninterest income	40,322				61,515				49,499				42,725				35,384				189,123
Noninterest expenses
Salaries and employee benefits	61,253				62,263				63,769				55,925				54,822				236,779
Net occupancy	5,704				6,159				5,625				5,378				6,104				23,266
Furniture and equipment	3,969				3,596				3,638				3,681				4,053				14,968
Data processing	7,287				7,269				6,837				7,019				6,389				27,514
Marketing	1,361				1,999				1,856				1,339				1,220				6,414
Communication	838				840				855				907				890				3,492
Professional services	1,450				3,038				2,443				2,205				2,275				9,961
Debt extinguishment	0				7,257				0				0				0				7,257
State intangible tax	1,202				1,514				1,514				1,514				1,516				6,058
FDIC assessments	1,349				1,065				1,350				1,290				1,405				5,110
Intangible amortization	2,479				2,764				2,779				2,791				2,792				11,126
Other	5,614				17,034				6,845				6,640				8,200				38,719
Total noninterest expenses	92,506				114,798				97,511				88,689				89,666				390,664
Income before income taxes	57,704				53,682				50,794				45,383				34,552				184,411
Income tax expense (benefit)	10,389				5,370				9,317				7,990				5,924				28,601
Net income	$	47,315			$	48,312			$	41,477			$	37,393			$	28,628			$	155,810
ADDITIONAL DATA
Net earnings per share - basic	$	0.49			$	0.50			$	0.43			$	0.38			$	0.29			$	1.60
Net earnings per share - diluted	$	0.48			$	0.49			$	0.42			$	0.38			$	0.29			$	1.59
Dividends declared per share	$	0.23			$	0.23			$	0.23			$	0.23			$	0.23			$	0.92
Return on average assets	1.20		%		1.20		%		1.04		%		0.96		%		0.79		%		1.00		%
Return on average shareholders' equity	8.44		%		8.52		%		7.40		%		6.88		%		5.21		%		7.02		%
Interest income	$	122,609			$	130,029			$	126,070			$	129,360			$	139,504			$	524,963
Tax equivalent adjustment	1,652				1,613				1,628				1,664				1,624				6,529
Interest income - tax equivalent	124,261				131,642				127,698				131,024				141,128				531,492
Interest expense	8,733				11,556				13,890				17,784				25,222				68,452
Net interest income - tax equivalent	$	115,528			$	120,086			$	113,808			$	113,240			$	115,906			$	463,040
Net interest margin	3.35		%		3.45		%		3.32		%		3.38		%		3.71		%		3.46		%
Net interest margin (fully tax equivalent) (1)	3.40		%		3.49		%		3.36		%		3.44		%		3.77		%		3.51		%
Full-time equivalent employees	2,063				2,075				2,065				2,076				2,067

(1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 21% tax rate.  Management believes that it is a standard practice in the banking industry to present net interest income on a fully tax equivalent basis.  Therefore, management believes these measures provide useful information to investors by allowing them to make peer comparisons.  Management also uses these measures to make peer comparisons.

 

FIRST FINANCIAL BANCORP.
CONSOLIDATED STATEMENTS OF CONDITION
(Dollars in thousands)
(Unaudited)
	Mar. 31,				Dec. 31,				Sep. 30,				June 30,				Mar. 31,				% Change			% Change
	2021				2020				2020				2020				2020				Linked Qtr.			Comp Qtr.
ASSETS
Cash and due from banks	$	210,191			$	231,054			$	207,128			$	283,639			$	261,892			(9.0)	%		(19.7)	%
Interest-bearing deposits with other banks	19,180				20,305				38,806				38,845				71,071				(5.5)	%		(73.0)	%
Investment securities available-for-sale	3,753,763				3,424,580				3,004,963				2,897,413				2,908,688				9.6	%		29.1	%
Investment securities held-to-maturity	121,945				131,687				118,072				127,347				136,744				(7.4)	%		(10.8)	%
Other investments	131,814				133,198				118,292				132,366				143,581				(1.0)	%		(8.2)	%
Loans held for sale	34,590				41,103				69,008				43,950				27,334				(15.8)	%		26.5	%
Loans and leases
Commercial and industrial	3,044,825				3,007,509				3,292,313				3,322,374				2,477,773				1.2	%		22.9	%
Lease financing	66,574				72,987				74,742				80,087				82,602				(8.8)	%		(19.4)	%
Construction real estate	642,709				636,096				575,648				506,085				500,311				1.0	%		28.5	%
Commercial real estate	4,396,582				4,307,858				4,347,125				4,343,702				4,278,257				2.1	%		2.8	%
Residential real estate	946,522				1,003,086				1,027,702				1,043,745				1,061,792				(5.6)	%		(10.9)	%
Home equity	709,667				743,099				754,743				764,171				781,243				(4.5)	%		(9.2)	%
Installment	82,421				81,850				84,629				79,150				80,085				0.7	%		2.9	%
Credit card	44,669				48,485				43,907				42,397				45,756				(7.9)	%		(2.4)	%
Total loans	9,933,969				9,900,970				10,200,809				10,181,711				9,307,819				0.3	%		6.7	%
Less:
Allowance for credit losses	169,923				175,679				168,544				158,661				143,885				(3.3)	%		18.1	%
Net loans	9,764,046				9,725,291				10,032,265				10,023,050				9,163,934				0.4	%		6.5	%
Premises and equipment	204,537				207,211				209,474				211,164				212,787				(1.3)	%		(3.9)	%
Goodwill	937,771				937,771				937,771				937,771				937,771				0.0	%		0.0	%
Other intangibles	61,984				64,552				67,419				70,325				73,258				(4.0)	%		(15.4)	%
Accrued interest and other assets	935,250				1,056,382				1,122,449				1,105,020				1,120,507				(11.5)	%		(16.5)	%
Total Assets	$	16,175,071			$	15,973,134			$	15,925,647			$	15,870,890			$	15,057,567			1.3	%		7.4	%
LIABILITIES
Deposits
Interest-bearing demand	$	2,914,761			$	2,914,787			$	2,632,467			$	2,657,841			$	2,498,109			0.0	%		16.7	%
Savings	4,006,181				3,680,774				3,446,678				3,287,314				2,978,250				8.8	%		34.5	%
Time	1,731,757				1,872,733				1,935,392				2,241,212				2,435,858				(7.5)	%		(28.9)	%
Total interest-bearing deposits	8,652,699				8,468,294				8,014,537				8,186,367				7,912,217				2.2	%		9.4	%
Noninterest-bearing	3,995,370				3,763,709				3,552,893				3,515,048				2,723,341				6.2	%		46.7	%
Total deposits	12,648,069				12,232,003				11,567,430				11,701,415				10,635,558				3.4	%		18.9	%
Federal funds purchased and securities sold
under agreements to repurchase	181,387				166,594				247,658				154,347				215,824				8.9	%		(16.0)	%
FHLB short-term borrowings	0				0				0				0				1,181,900				0.0	%		(100.0)	%
Total short-term borrowings	181,387				166,594				247,658				154,347				1,397,724				8.9	%		(87.0)	%
Long-term debt	583,722				776,202				1,341,164				1,285,767				325,566				(24.8)	%		79.3	%
Total borrowed funds	765,109				942,796				1,588,822				1,440,114				1,723,290				(18.8)	%		(55.6)	%
Accrued interest and other liabilities	502,951				516,265				521,580				508,342				519,336				(2.6)	%		(3.2)	%
Total Liabilities	13,916,129				13,691,064				13,677,832				13,649,871				12,878,184				1.6	%		8.1	%
SHAREHOLDERS' EQUITY
Common stock	1,633,137				1,638,947				1,637,489				1,635,070				1,633,950				(0.4)	%		0.0	%
Retained earnings	745,220				720,429				694,484				675,532				660,653				3.4	%		12.8	%
Accumulated other comprehensive income (loss)	18,101				48,664				42,266				36,431				11,788				(62.8)	%		53.6	%
Treasury stock, at cost	(137,516)				(125,970)				(126,424)				(126,014)				(127,008)				9.2	%		8.3	%
Total Shareholders' Equity	2,258,942				2,282,070				2,247,815				2,221,019				2,179,383				(1.0)	%		3.7	%
Total Liabilities and Shareholders' Equity	$	16,175,071			$	15,973,134			$	15,925,647			$	15,870,890			$	15,057,567			1.3	%		7.4	%

 

FIRST FINANCIAL BANCORP.
AVERAGE CONSOLIDATED STATEMENTS OF CONDITION
(Dollars in thousands)
(Unaudited)
	Quarterly Averages
	Mar. 31,				Dec. 31,				Sep. 30,				June 30,				Mar. 31,
	2021				2020				2020				2020				2020
ASSETS
Cash and due from banks	$	232,275			$	228,427			$	233,216			$	284,726			$	235,696
Interest-bearing deposits with other banks	46,912				143,884				40,277				91,990				39,332
Investment securities	3,782,993				3,403,839				3,162,832				3,164,243				3,115,723
Loans held for sale	29,689				42,402				45,186				36,592				13,174
Loans and leases
Commercial and industrial	3,029,716				3,182,749				3,299,259				3,058,677				2,450,893
Lease financing	70,508				74,107				78,500				81,218				85,782
Construction real estate	647,655				608,401				536,870				495,407				501,471
Commercial real estate	4,339,349				4,313,408				4,364,708				4,381,647				4,209,345
Residential real estate	980,718				1,022,701				1,041,250				1,052,996				1,055,456
Home equity	726,134				752,425				759,994				772,424				773,082
Installment	81,377				83,509				82,016				79,016				81,234
Credit card	46,709				48,179				45,609				44,402				50,206
Total loans	9,922,166				10,085,479				10,208,206				9,965,787				9,207,469
Less:
Allowance for credit losses	177,863				172,201				165,270				155,454				121,126
Net loans	9,744,303				9,913,278				10,042,936				9,810,333				9,086,343
Premises and equipment	206,628				208,800				211,454				213,903				215,545
Goodwill	937,771				937,771				937,771				937,771				937,771
Other intangibles	63,529				66,195				69,169				72,086				75,014
Accrued interest and other assets	998,554				1,086,390				1,099,169				1,098,560				805,824
Total Assets	$	16,042,654			$	16,030,986			$	15,842,010			$	15,710,204			$	14,524,422
LIABILITIES
Deposits
Interest-bearing demand	$	2,948,682			$	2,812,748			$	2,668,635			$	2,602,917			$	2,418,193
Savings	3,815,314				3,547,179				3,342,514				3,173,274				2,976,518
Time	1,767,826				1,844,379				2,015,933				2,619,038				2,196,080
Total interest-bearing deposits	8,531,822				8,204,306				8,027,082				8,395,229				7,590,791
Noninterest-bearing	3,840,046				3,720,417				3,535,432				3,335,866				2,643,240
Total deposits	12,371,868				11,924,723				11,562,514				11,731,095				10,234,031
Federal funds purchased and securities sold
under agreements to repurchase	184,483				136,795				150,088				145,291				164,093
FHLB short-term borrowings	67,222				7,937				30,868				548,183				1,189,765
Total short-term borrowings	251,705				144,732				180,956				693,474				1,353,858
Long-term debt	634,674				1,162,729				1,338,792				579,345				381,909
Total borrowed funds	886,379				1,307,461				1,519,748				1,272,819				1,735,767
Accrued interest and other liabilities	511,658				542,740				529,326				520,425				344,891
Total Liabilities	13,769,905				13,774,924				13,611,588				13,524,339				12,314,689
SHAREHOLDERS' EQUITY
Common stock	1,636,884				1,638,032				1,636,107				1,634,405				1,638,851
Retained earnings	726,351				703,257				679,980				658,312				660,108
Accumulated other comprehensive loss	42,253				40,960				40,697				19,888				31,200
Treasury stock, at cost	(132,739)				(126,187)				(126,362)				(126,740)				(120,426)
Total Shareholders' Equity	2,272,749				2,256,062				2,230,422				2,185,865				2,209,733
Total Liabilities and Shareholders' Equity	$	16,042,654			$	16,030,986			$	15,842,010			$	15,710,204			$	14,524,422

 

FIRST FINANCIAL BANCORP.
NET INTEREST MARGIN RATE/VOLUME ANALYSIS
(Dollars in thousands)
(Unaudited)
		Quarterly Averages
		March 31, 2021							December 31, 2020							March 31, 2020							Linked Qtr. Income Variance												Comparable Qtr. Income Variance
		Balance				Yield			Balance				Yield			Balance				Yield			Rate				Volume				Total				Rate				Volume				Total
Earning assets
Investments:
Investment securities		$	3,782,993			2.54	%		$	3,403,839			2.71	%		$	3,115,723			3.04	%		$	(1,488)			$	1,897			$	409			$	(3,892)			$	3,955			$	63
Interest-bearing deposits with other banks		46,912				0.24	%		143,884				0.15	%		39,332				1.45	%		33				(60)				(27)				(118)				4				(114)
Gross loans (1)		9,951,855				4.03	%		10,127,881				4.18	%		9,220,643				5.04	%		(3,815)				(3,987)				(7,802)				(23,094)				6,250				(16,844)
Total earning assets		13,781,760				3.61	%		13,675,604				3.77	%		12,375,698				4.52	%		(5,270)				(2,150)				(7,420)				(27,104)				10,209				(16,895)
Nonearning assets
Allowance for credit losses		(177,863)							(172,201)							(121,126)
Cash and due from banks		232,275							228,427							235,696
Accrued interest and other assets		2,206,482							2,299,156							2,034,154
Total assets		$	16,042,654						$	16,030,986						$	14,524,422
Interest-bearing liabilities
Deposits:
Interest-bearing demand		$	2,948,682			0.07	%		$	2,812,748			0.08	%		$	2,418,193			0.45	%
Savings		3,815,314				0.13	%		3,547,179				0.15	%		2,976,518				0.45	%
Time		1,767,826				0.60	%		1,844,379				0.86	%		2,196,080				1.88	%
Total interest-bearing deposits		8,531,822				0.21	%		8,204,306				0.29	%		7,590,791				0.86	%		$	(1,661)			$	74			$	(1,587)			$	(12,467)			$	435			$	(12,032)
Borrowed funds
Short-term borrowings		251,705				0.11	%		144,732				0.08	%		1,353,858				1.51	%		9				28				37				(4,723)				(297)				(5,020)
Long-term debt		634,674				2.77	%		1,162,729				1.91	%		381,909				3.96	%		2,509				(3,782)				(1,273)				(1,134)				1,697				563
Total borrowed funds		886,379				2.01	%		1,307,461				1.71	%		1,735,767				2.05	%		2,518				(3,754)				(1,236)				(5,857)				1,400				(4,457)
Total interest-bearing liabilities		9,418,201				0.38	%		9,511,767				0.48	%		9,326,558				1.08	%		857				(3,680)				(2,823)				(18,324)				1,835				(16,489)
Noninterest-bearing liabilities
Noninterest-bearing demand deposits		3,840,046							3,720,417							2,643,240
Other liabilities		511,658							542,740							344,891
Shareholders' equity		2,272,749							2,256,062							2,209,733
Total liabilities & shareholders' equity		$	16,042,654						$	16,030,986						$	14,524,422
Net interest income		$	113,876						$	118,473						$	114,282						$	(6,127)			$	1,530			$	(4,597)			$	(8,780)			$	8,374			$	(406)
Net interest spread						3.23	%						3.29	%						3.44	%
Net interest margin						3.35	%						3.45	%						3.71	%
Tax equivalent adjustment						0.05	%						0.04	%						0.06	%
Net interest margin (fully tax equivalent)						3.40	%						3.49	%						3.77	%
(1) Loans held for sale and nonaccrual loans are included in gross loans.

 

FIRST FINANCIAL BANCORP.
CREDIT QUALITY
(Dollars in thousands)
(Unaudited)
	Mar. 31,				Dec. 31,				Sep. 30,				June 30,				Mar. 31,
	2021				2020				2020				2020				2020
ALLOWANCE FOR CREDIT LOSS ACTIVITY
Balance at beginning of period	$	175,679			$	168,544			$	158,661			$	143,885			$	57,650
Day one adoption impact of ASC 326	0				0				0				0				61,505
Provision for credit losses	3,450				13,758				15,299				17,859				23,880
Gross charge-offs
Commercial and industrial	7,910				1,505				1,467				1,282				1,091
Lease financing	0				0				852				0				0
Construction real estate	2				0				0				0				0
Commercial real estate	1,250				6,270				3,789				2,037				4
Residential real estate	1				203				22				148				115
Home equity	611				386				460				428				267
Installment	36				21				59				7				61
Credit card	222				169				171				234				311
Total gross charge-offs	10,032				8,554				6,820				4,136				1,849
Recoveries
Commercial and industrial	337				367				265				275				2,000
Lease financing	0				(6)				6				0				0
Construction real estate	0				3				0				14				0
Commercial real estate	195				844				760				424				234
Residential real estate	44				145				91				93				52
Home equity	177				428				209				156				339
Installment	34				65				35				27				31
Credit card	39				85				38				64				43
Total recoveries	826				1,931				1,404				1,053				2,699
Total net charge-offs	9,206				6,623				5,416				3,083				(850)
Ending allowance for credit losses	$	169,923			$	175,679			$	168,544			$	158,661			$	143,885
NET CHARGE-OFFS TO AVERAGE LOANS AND LEASES (ANNUALIZED)
Commercial and industrial	1.01		%		0.14		%		0.14		%		0.13		%		(0.15)		%
Lease financing	0.00		%		0.03		%		4.29		%		0.00		%		0.00		%
Construction real estate	0.00		%		0.00		%		0.00		%		(0.01)		%		0.00		%
Commercial real estate	0.10		%		0.50		%		0.28		%		0.15		%		(0.02)		%
Residential real estate	(0.02)		%		0.02		%		(0.03)		%		0.02		%		0.02		%
Home equity	0.24		%		(0.02)		%		0.13		%		0.14		%		(0.04)		%
Installment	0.01		%		(0.21)		%		0.12		%		(0.10)		%		0.15		%
Credit card	1.59		%		0.69		%		1.16		%		1.54		%		2.15		%
Total net charge-offs	0.38		%		0.26		%		0.21		%		0.12		%		(0.04)		%
COMPONENTS OF NONPERFORMING LOANS, NONPERFORMING ASSETS, AND UNDERPERFORMING ASSETS
Nonaccrual loans (1)
Commercial and industrial	$	24,941			$	29,230			$	34,686			$	33,906			$	21,126
Lease financing	0				0				1,092				1,353				222
Construction real estate	0				0				0				0				0
Commercial real estate	44,514				34,682				24,521				14,002				10,050
Residential real estate	11,359				11,601				12,104				12,813				11,163
Home equity	4,286				5,076				5,374				5,604				5,821
Installment	146				163				153				201				145
Nonaccrual loans	85,246				80,752				77,930				67,879				48,527
Accruing troubled debt restructurings (TDRs)	11,608				7,099				7,759				8,377				22,206
Total nonperforming loans	96,854				87,851				85,689				76,256				70,733
Other real estate owned (OREO)	854				1,287				1,643				1,872				1,467
Total nonperforming assets	97,708				89,138				87,332				78,128				72,200
Accruing loans past due 90 days or more	92				169				79				124				120
Total underperforming assets	$	97,800			$	89,307			$	87,411			$	78,252			$	72,320
Total classified assets	$	196,782			$	142,021			$	134,002			$	125,543			$	124,510
CREDIT QUALITY RATIOS
Allowance for credit losses to
Nonaccrual loans	199.33		%		217.55		%		216.28		%		233.74		%		296.51		%
Nonperforming loans	175.44		%		199.97		%		196.69		%		208.06		%		203.42		%
Total ending loans	1.71		%		1.77		%		1.65		%		1.56		%		1.55		%
Nonperforming loans to total loans	0.97		%		0.89		%		0.84		%		0.75		%		0.76		%
Nonperforming assets to
Ending loans, plus OREO	0.98		%		0.90		%		0.86		%		0.77		%		0.78		%
Total assets	0.60		%		0.56		%		0.55		%		0.49		%		0.48		%
Nonperforming assets, excluding accruing TDRs to
Ending loans, plus OREO	0.87		%		0.83		%		0.78		%		0.68		%		0.54		%
Total assets	0.53		%		0.51		%		0.50		%		0.44		%		0.33		%
Classified assets to total assets	1.22		%		0.89		%		0.84		%		0.79		%		0.83		%

(1)  Nonaccrual loans include nonaccrual TDRs of $20.9 million, $14.7 million, $29.3 million, $32.7 million, and $18.4 million, as of March 31, 2021, December 31, 2020, September 30, 2020, June 30, 2020, and March 31, 2020,  respectively.

 

FIRST FINANCIAL BANCORP.
CAPITAL ADEQUACY
(Dollars in thousands, except per share data)
(Unaudited)
	Mar. 31,				Dec. 31,				Sep. 30,				June 30,				Mar. 31,
	2021				2020				2020				2020				2020
PER COMMON SHARE
Market Price
High	$	26.40			$	17.77			$	15.15			$	16.38			$	25.52
Low	$	17.62			$	12.07			$	11.40			$	11.52			$	12.67
Close	$	24.00			$	17.53			$	12.01			$	13.89			$	14.91
Average shares outstanding - basic	96,873,940				97,253,787				97,247,080				97,220,748				97,736,690
Average shares outstanding - diluted	97,727,527				98,020,534				98,008,733				97,988,600				98,356,214
Ending shares outstanding	97,517,693				98,021,929				97,999,763				98,018,858				97,968,958
Total shareholders' equity	$	2,258,942			$	2,282,070			$	2,247,815			$	2,221,019			$	2,179,383
REGULATORY CAPITAL	Preliminary
Common equity tier 1 capital	$	1,334,882			$	1,325,922			$	1,293,716			$	1,267,609			$	1,243,152
Common equity tier 1 capital ratio	11.81		%		11.82		%		11.63		%		11.49		%		11.27		%
Tier 1 capital	$	1,377,892			$	1,368,818			$	1,336,497			$	1,310,276			$	1,285,705
Tier 1 ratio	12.19		%		12.20		%		12.02		%		11.87		%		11.66		%
Total capital	$	1,741,755			$	1,744,802			$	1,708,817			$	1,676,532			$	1,493,100
Total capital ratio	15.41		%		15.55		%		15.37		%		15.19		%		13.54		%
Total capital in excess of minimum requirement	$	554,834			$	566,795			$	541,263			$	517,902			$	335,229
Total risk-weighted assets	$	11,304,012			$	11,219,114			$	11,119,560			$	11,034,570			$	11,027,347
Leverage ratio	9.34		%		9.55		%		9.55		%		8.98		%		9.49		%
OTHER CAPITAL RATIOS
Ending shareholders' equity to ending assets	13.97		%		14.29		%		14.11		%		13.99		%		14.47		%
Ending tangible shareholders' equity to ending tangible assets	8.22		%		8.47		%		8.25		%		8.09		%		8.25		%
Average shareholders' equity to average assets	14.17		%		14.07		%		14.08		%		13.91		%		15.21		%
Average tangible shareholders' equity to average tangible assets	8.38		%		8.26		%		8.18		%		7.94		%		8.79		%
REPURCHASE PROGRAM (1)
Shares repurchased	840,115				0				0				0				880,000
Average share repurchase price	$	21.40			N/A				N/A				N/A				$	18.96
Total cost of shares repurchased	$	17,982			N/A				N/A				N/A				$	16,686
(1) Represents share repurchases as part of publicly announced plans.
N/A = Not applicable

 

View original content:http://www.prnewswire.com/news-releases/first-financial-bancorp-announces-first-quarter-2021-financial-results-301275366.html

SOURCE First Financial Bancorp.

FAQ

What were the earnings results for First Financial Bancorp in Q1 2021?

First Financial Bancorp reported net income of $47.3 million, or $0.48 per diluted share, for Q1 2021.

How did First Financial Bancorp's net interest margin perform in Q1 2021?

The net interest margin for Q1 2021 was 3.40%.

What was the provision for credit losses for First Financial Bancorp in Q1 2021?

The provision for credit losses in Q1 2021 was $4 million, reflecting a decrease from previous quarters.

What share repurchase activity occurred during the first quarter of 2021?

First Financial Bancorp repurchased 840,115 shares during Q1 2021.

What is the outlook for First Financial Bancorp following the Q1 2021 results?

The outlook is optimistic due to improved economic conditions, despite challenges such as low interest rates.