HBT Financial, Inc. Announces Fourth Quarter 2022 Financial Results

Rhea-AI Summary

HBT Financial, Inc. reported a net income of $17.2 million or $0.59 per diluted share for Q4 2022, an increase from $15.6 million in Q3 2022. Adjusted net income rose to $17.9 million or $0.62 per diluted share. ROAA was 1.60%, and ROAE reached 18.50%. The net interest margin expanded to 4.10%, and a quarterly dividend was increased to $0.17 per share. Total loans grew to $2.62 billion, while total deposits decreased to $3.59 billion. HBT anticipates closing its acquisition of Town and Country Financial on February 1, 2023.

Positive

• Net income increased to $17.2 million for Q4 2022, up from $15.6 million in Q3 2022.
• Adjusted net income rose to $17.9 million, reflecting strong operational performance.
• Quarterly cash dividend raised to $0.17 per share, up from $0.16.
• Net interest margin expanded to 4.10%, a positive indicator of profitability.
• Total loans grew by $40.3 million, indicating strong lending activity.

Negative

• Total deposits decreased by $56.4 million from Q3 2022.
• Noninterest income decreased by 4.2% quarter-over-quarter, primarily from a negative mortgage servicing rights adjustment.
• Noninterest expense increased by 14.6% from Q3 2022, driven by legal accruals and rising salaries.

Quarterly Cash Dividend Increased to $0.17 per Share

Fourth Quarter Highlights

• Net income of $17.2 million, or $0.59 per diluted share; return on average assets (ROAA) of 1.60%; return on average stockholders’ equity (ROAE) of 18.50%; and return on average tangible common equity (ROATCE)⁽¹⁾ of 20.17%
• Adjusted net income⁽¹⁾ of $17.9 million; or $0.62 per diluted share; adjusted ROAA⁽¹⁾ of 1.67%; adjusted ROAE⁽¹⁾ of 19.31%; and adjusted ROATCE⁽¹⁾ of 21.05%
• Asset quality remained strong with nonperforming assets to total assets of 0.12%
• Net interest margin expanded 45 basis points to 4.10%

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(1)   See “Reconciliation of Non-GAAP Financial Measures” below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.

BLOOMINGTON, Ill., Jan. 25, 2023 (GLOBE NEWSWIRE) -- HBT Financial, Inc. (NASDAQ: HBT) (the “Company” or “HBT Financial” or “HBT”), the holding company for Heartland Bank and Trust Company, today reported net income of $17.2 million, or $0.59 diluted earnings per share, for the fourth quarter of 2022. This compares to net income of $15.6 million, or $0.54 diluted earnings per share, for the third quarter of 2022, and net income of $13.6 million, or $0.47 diluted earnings per share, for the fourth quarter of 2021.

Fred L. Drake, Chairman and Chief Executive Officer of HBT Financial, said, “We had an excellent fourth quarter to complete 2022, thanks to growth in average earning assets, expanded net interest margin and solid non-interest income, resulting in increased book value and tangible book value per share. We expect to deliver good results again for our shareholders in 2023. We are excited to close the pending merger with Town and Country Financial Corporation (‘Town and Country’) during the first quarter, which will add scale and efficiency, generate profitable growth and enhance the long-term value of our company. Town and Country has a long history in their markets and is a high performing bank – we look forward to teaming up to build future success.”

“While the economy faces a lot of uncertainty, we are confident in our ability to manage through challenging times. Our bank has a strong foundation, with a proven executive team, an established core deposit base and a conservative, well-diversified loan portfolio.”

Adjusted Net Income

In addition to reporting GAAP results, the Company believes adjusted net income and adjusted earnings per share, which adjust for acquisition expenses, branch closure expenses, gains (losses) on sale of closed branch premises, net earnings (losses) from closed or sold operations, charges related to termination of certain employee benefit plans, realized gains (losses) on sales of securities, and mortgage servicing rights fair value adjustments, provide investors with additional insight into its operational performance. The Company reported adjusted net income of $17.9 million, or $0.62 adjusted diluted earnings per share, for the fourth quarter of 2022. This compares to adjusted net income of $15.9 million, or $0.55 adjusted diluted earnings per share, for the third quarter of 2022, and adjusted net income of $14.2 million, or $0.49 adjusted diluted earnings per share, for the fourth quarter of 2021 (see “Reconciliation of Non-GAAP Financial Measures” tables).

Cash Dividend

On January 24, 2023, the Company’s Board of Directors declared a quarterly cash dividend of $0.17 per share on the Company’s common stock (the “Dividend”). The Dividend is payable on February 14, 2023 to shareholders of record as of February 7, 2023. This represents an increase of $0.01 from the previous quarterly dividend of $0.16 per share.

Mr. Drake noted, “We are very pleased that our strong financial performance and capital ratios have enabled us to further increase our quarterly cash dividend while maintaining sufficient capital to support the continued growth of the Company.”

Net Interest Income and Net Interest Margin

Net interest income for the fourth quarter of 2022 was $42.2 million, an increase of 12.8% from $37.4 million for the third quarter of 2022. The increase was primarily attributable to higher yields on interest-earning assets, with the yield on loans increasing 70 basis points to 5.61%, while the cost of funds only increased 11 basis points to 0.28%. Contributing to the increased loan interest income were higher nonaccrual interest recoveries which totaled $1.3 million during the fourth quarter of 2022 and $0.1 million during the third quarter of 2022.

Relative to the fourth quarter of 2021, net interest income increased 28.4% from $32.9 million. The increase was primarily attributable to higher yields on interest-earning assets, a more favorable asset mix, and nonaccrual interest recoveries. Partially offsetting these improvements was a decrease in PPP loan fees recognized as loan interest income which totaled $1.6 million during the fourth quarter of 2021. Additionally, nonaccrual interest recoveries totaled $0.5 million during the fourth quarter of 2021.

Net interest margin for the fourth quarter of 2022 was 4.10%, compared to 3.65% for the third quarter of 2022. The increase was primarily attributable to higher yields on interest-earning assets. The contribution of nonaccrual interest recoveries to net interest margin was 13 basis points during the fourth quarter of 2022 and 1 basis point during the third quarter of 2022. Additionally, acquired loan discount accretion contributed 2 basis points to net interest margin during the fourth quarter of 2022 and 2 basis points during the third quarter of 2022.

Relative to the fourth quarter of 2021, net interest margin increased from 3.17%. This increase was primarily attributable to higher yields on interest-earning assets and a more favorable mix of interest-earning assets. Nonaccrual interest recoveries contributed 5 basis points to net interest margin, and acquired loan discount accretion contributed 6 basis points to net interest margin, during the fourth quarter of 2021.

Noninterest Income

Noninterest income for the fourth quarter of 2022 was $7.9 million, a decrease of 4.2% from $8.2 million for the third quarter of 2022. The decrease was primarily attributable to the fourth quarter 2022 results including a negative $0.3 million mortgage servicing rights (“MSR”) fair value adjustment, while the third quarter of 2022 included a positive $0.4 million MSR fair value adjustment. Partially offsetting this decline was a $0.4 million increase in wealth management fees, primarily due to increased farmland brokerage service fees.

Relative to the fourth quarter of 2021, noninterest income decreased 15.7% from $9.4 million. The decline was primarily due to a $0.7 million decrease in gains on sale of mortgage loans. Additionally, the fourth quarter of 2021 results included a positive $0.3 million MSR fair value adjustment.

Noninterest Expense

Noninterest expense for the fourth quarter of 2022 was $27.5 million, a 14.6% increase from $24.0 million for the third quarter of 2022. The increase was primarily due to a $2.6 million accrual related to pending legal matters, a $0.5 million increase in salaries expense, and a $0.4 million increase in benefits expense driven by higher medical benefit costs.

Relative to the fourth quarter of 2021, noninterest expense increased 12.8% from $24.4 million, also primarily attributable to the accrual for pending legal matters and increased salaries and benefits expenses.

Loan Portfolio

Total loans outstanding, before allowance for loan losses, were $2.62 billion at December 31, 2022, compared with $2.58 billion at September 30, 2022 and $2.50 billion at December 31, 2021. The $40.3 million increase in total loans from September 30, 2022 was primarily attributable to growth in the multi-family and commercial and industrial categories. The $26.1 million increase in commercial and industrial loans was driven primarily by higher balances on lines of credit across a variety of industries.

Deposits

Total deposits were $3.59 billion at December 31, 2022, compared with $3.64 billion at September 30, 2022 and $3.74 billion at December 31, 2021. The $56.4 million decrease from September 30, 2022 was primarily attributable to lower balances maintained in public funds and business accounts, while balances maintained in retail accounts remained nearly unchanged.

Asset Quality

Nonperforming loans totaled $2.2 million, or 0.08% of total loans, at December 31, 2022, compared with $3.2 million, or 0.12% of total loans, at September 30, 2022, and $2.8 million, or 0.11% of total loans, at December 31, 2021.

The Company recorded a negative provision for loan losses of $0.7 million for the fourth quarter of 2022, compared to a provision for loan losses of $0.4 million for the third quarter of 2022. The negative provision was primarily due to $0.9 million of net recoveries, partially offset by a $0.3 million increase in required reserves, resulting primarily from the increase in loans during the fourth quarter of 2022.

The Company had net recoveries of $0.9 million, or (0.14)% of average loans on an annualized basis, for the fourth quarter of 2022, compared to net charge-offs of $0.1 million, or 0.01% of average loans on an annualized basis, for the third quarter of 2022, and net charge-offs of $0.1 million, or 0.01% of average loans on an annualized basis, for the fourth quarter of 2021.

The Company’s allowance for loan losses was 0.97% of total loans and 1,175% of nonperforming loans at December 31, 2022, compared with 0.97% of total loans and 782% of nonperforming loans at September 30, 2022.

On January 1, 2023, the Company adopted ASU 2016-13 (Topic 326), Measurement of Credit Losses on Financial Instruments, commonly referenced as the Current Expected Credit Loss (“CECL”) standard. Management is finalizing macroeconomic conditions and forecast assumptions to be used in our CECL model; however, we expect the initial allowance for credit losses and the reserve for unfunded commitments together to be approximately 25% to 50% above the existing allowance for loan loss levels. When finalized, this one-time increase will be recorded, net of tax, as an adjustment to beginning retained earnings. Ongoing impacts of the CECL methodology will be dependent upon changes in economic conditions and forecasts, the credit quality of our loan portfolio, originated and acquired loan portfolio composition, portfolio duration, and other factors.

Stock Repurchase Program

During the fourth quarter of 2022, the Company did not repurchase any shares of its common stock. The Company’s Board of Directors authorized a new stock repurchase program that took effect upon the expiration of the Company’s prior stock repurchase program on January 1, 2023. The new Program will be in effect until January 1, 2024 and authorizes the Company to repurchase up to $15 million of its common stock.

Pending Acquisition of Town and Country

On August 23, 2022, HBT and Town and Country, the holding company for Town and Country Bank, jointly announced the signing of a definitive agreement pursuant to which HBT will acquire Town and Country and Town and Country Bank. The acquisition will further enhance HBT’s footprint in Central Illinois as well as expand HBT’s footprint into metro-east St. Louis. Acquisition-related expenses were $0.6 million during the fourth quarter of 2022 and $0.5 million during the third quarter of 2022. The acquisition is expected to close on February 1, 2023.

About HBT Financial, Inc.

HBT Financial, Inc., headquartered in Bloomington, Illinois, is the holding company for Heartland Bank and Trust Company, and has banking roots that can be traced back to 1920. HBT provides a comprehensive suite of business, commercial, wealth management, and retail banking products and services to individuals, businesses and municipal entities throughout Central and Northeastern Illinois and Eastern Iowa through 58 full-service branches. As of December 31, 2022, HBT had total assets of $4.3 billion, total loans of $2.6 billion, and total deposits of $3.6 billion.

Non-GAAP Financial Measures

Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with GAAP. These non-GAAP financial measures include net interest income (tax-equivalent basis), net interest margin (tax-equivalent basis), efficiency ratio (tax-equivalent basis), tangible common equity to tangible assets, tangible book value per share, return on average tangible common equity, adjusted net income, adjusted earnings per share, adjusted return on average assets, adjusted return on average stockholders’ equity, and adjusted return on average tangible common equity. Our management uses these non-GAAP financial measures, together with the related GAAP financial measures, in its analysis of our performance and in making business decisions. Management believes that it is a standard practice in the banking industry to present these non-GAAP financial measures, and accordingly believes that providing these measures may be useful for peer comparison purposes. These disclosures should not be viewed as substitutes for the results determined to be in accordance with GAAP; nor are they necessarily comparable to non-GAAP financial measures that may be presented by other companies. See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures in the “Reconciliation of Non-GAAP Financial Measures” tables.

Forward-Looking Statements

Readers should note that in addition to the historical information contained herein, this press release contains, and future oral and written statements of the Company and its management may contain, "forward-looking statements" within the meanings of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “will,” “propose,” “may,” “plan,” “seek,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “continue,” or “should,” or similar terminology. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to: (i) the strength of the local, state, national and international economies (including effects of inflationary pressures and supply chain constraints); (ii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics (including the COVID-19 pandemic in the United States), acts of war or other threats thereof, or other adverse external events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies, the FASB or the PCAOB; (iv) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business; (v) changes in interest rates and prepayment rates of the Company’s assets (including the impact of LIBOR phase-out); (vi) increased competition in the financial services sector and the inability to attract new customers; (vii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (viii) unexpected results of acquisitions, which may include failure to realize the anticipated benefits of acquisitions and the possibility that transaction costs may be greater than anticipated; (ix) the loss of key executives or employees; (x) changes in consumer spending; (xi) unexpected outcomes of existing or new litigation involving the Company; (xii) the economic impact of exceptional weather occurrences such as tornadoes, floods and blizzards; (xiii) the risk that a condition to closing of the pending Town and Country transaction may not be satisfied, that either party may terminate the merger agreement or that the closing of the pending transaction might be delayed or not occur at all; (xiv) potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the transaction; (xv) the diversion of management time on transaction-related issues; (xvi) the ultimate timing, outcome and results of integrating the operations of Town and Country into those of HBT; (xvii) the effects of the merger on HBT’s future financial condition, results of operations, strategy and plans; and (xviii) the ability of the Company to manage the risks associated with the foregoing. Readers should note that the forward-looking statements included in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission (the “SEC”).

Important Information and Where to Find It

In connection with the proposed transaction, HBT Financial and Town and Country filed a Registration Statement on Form S-4 of HBT Financial that includes a proxy statement of Town and Country and a prospectus of HBT Financial that has been distributed to the stockholders of Town and Country. This document is not a substitute for the proxy statement/prospectus or the Registration Statement or for any other document that HBT Financial or Town and Country may file with the SEC and/or send to Town and Country’s stockholders in connection with the proposed transaction. TOWN AND COUNTRY’S STOCKHOLDERS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND THE REGISTRATION STATEMENT AND ALL OTHER RELEVANT DOCUMENTS FILED BY HBT FINANCIAL OR TOWN AND COUNTRY OR DISTRIBUTED TO TOWN AND COUNTRY STOCKHOLDERS BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT HBT FINANCIAL, TOWN AND COUNTRY AND THE PROPOSED TRANSACTION.

Investors can obtain free copies of the Registration Statement and proxy statement/prospectus, as each may be amended from time to time, and other relevant documents filed by HBT Financial and Town and Country with the SEC through the website maintained by the SEC at www.sec.gov. Copies of documents filed with the SEC by HBT Financial are available free of charge from HBT Financial’s website at https://ir.hbtfinancial.com or by contacting HBT Financial’s Investor Relations Department at HBTIR@hbtbank.com.

No Offer or Solicitation

This document does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy any securities with respect to the proposed transaction or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

CONTACT:
Peter Chapman
HBTIR@hbtbank.com
(888) 897-2276

HBT Financial, Inc.
Unaudited Consolidated Financial Summary

		As of or for the Three Months Ended												Year Ended
		December 31,				September 30,				December 31,				December 31,
		2022				2022				2021				2022				2021
		(dollars in thousands, except per share data)
Interest and dividend income		$	44,948			$	39,014			$	34,355			$	153,054			$	128,223
Interest expense			2,765				1,624				1,496				7,180				5,820
Net interest income			42,183				37,390				32,859				145,874				122,403
Provision for loan losses			(653	)			386				(843	)			(706	)			(8,077	)
Net interest income after provision for loan losses			42,836				37,004				33,702				146,580				130,480
Noninterest income			7,889				8,234				9,354				34,717				37,328
Noninterest expense			27,510				23,998				24,381				99,507				91,246
Income before income tax expense			23,215				21,240				18,675				81,790				76,562
Income tax expense			6,058				5,613				5,081				21,317				20,291
Net income		$	17,157			$	15,627			$	13,594			$	60,473			$	56,271
Earnings per share - Basic		$	0.60			$	0.54			$	0.47			$	2.09			$	2.02
Earnings per share - Diluted			0.59				0.54				0.47				2.09				2.02
Adjusted net income (1)		$	17,903			$	15,856			$	14,160			$	59,822			$	56,840
Adjusted earnings per share - Basic (1)			0.62				0.55				0.49				2.07				2.04
Adjusted earnings per share - Diluted (1)			0.62				0.55				0.49				2.07				2.04
Book value per share		$	13.13			$	12.49			$	14.21
Tangible book value per share (1)			12.08				11.43				13.13
Shares of common stock outstanding			28,752,626				28,752,626				28,986,061
Weighted average shares of common stock outstanding			28,752,626				28,787,662				29,036,164				28,853,697				27,795,806
SUMMARY RATIOS
Net interest margin *			4.10		%		3.65		%		3.17		%		3.54		%		3.18		%
Net interest margin (tax equivalent basis) * (1)(2)			4.17				3.72				3.22				3.60				3.23
Efficiency ratio			54.66		%		52.07		%		57.15		%		54.62		%		56.46		%
Efficiency ratio (tax equivalent basis) (1)(2)			53.91				51.31				56.47				53.87				55.76
Loan to deposit ratio			73.05		%		70.81		%		66.87		%
Return on average assets *			1.60		%		1.47		%		1.26		%		1.42		%		1.41		%
Return on average stockholders’ equity *			18.50				16.27				13.15				15.78				14.81
Return on average tangible common equity * (1)			20.17				17.70				14.24				17.15				15.95
Adjusted return on average assets * (1)			1.67		%		1.49		%		1.32		%		1.40		%		1.43		%
Adjusted return on average stockholders’ equity * (1)			19.31				16.51				13.70				15.61				14.95
Adjusted return on average tangible common equity * (1)			21.05				17.96				14.83				16.97				16.12
CAPITAL
Total capital to risk-weighted assets			16.45		%		16.34		%		16.88		%
Tier 1 capital to risk-weighted assets			14.41				14.26				14.66
Common equity tier 1 capital ratio			13.25				13.08				13.37
Tier 1 leverage ratio			10.58				10.44				9.84
Total stockholders’ equity to total assets			8.83				8.52				9.55
Tangible common equity to tangible assets (1)			8.18				7.85				8.89
ASSET QUALITY
Net charge-offs (recoveries) to average loans, before allowance for loan losses			(0.14	)	%		0.01		%		0.01		%		(0.08	)	%		(0.01	)	%
Allowance for loan losses to loans, before allowance for loan losses			0.97				0.97				0.96
Nonperforming loans to loans, before allowance for loan losses			0.08				0.12				0.11
Nonperforming assets to total assets			0.12				0.14				0.14

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*   Annualized measure.
(1)   See “Reconciliation of Non-GAAP Financial Measures” below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
(2)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.

HBT Financial, Inc.
Unaudited Consolidated Financial Summary
Consolidated Statements of Income

		Three Months Ended												Year Ended
		December 31,				September 30,				December 31,				December 31,
		2022				2022				2021				2022				2021
INTEREST AND DIVIDEND INCOME		(dollars in thousands, except per share data)
Loans, including fees:
Taxable		$	35,839			$	29,855			$	27,884			$	120,343			$	103,900
Federally tax exempt			952				842				662				3,135				2,384
Securities:
Taxable			6,421				6,635				4,625				23,368				16,948
Federally tax exempt			1,184				1,207				1,017				4,569				4,400
Interest-bearing deposits in bank			504				458				142				1,541				527
Other interest and dividend income			48				17				25				98				64
Total interest and dividend income			44,948				39,014				34,355				153,054				128,223
INTEREST EXPENSE
Deposits			849				587				651				2,511				2,472
Securities sold under agreements to repurchase			10				9				11				36				34
Borrowings			880				85				7				967				9
Subordinated notes			470				470				470				1,879				1,879
Junior subordinated debentures issued to capital trusts			556				473				357				1,787				1,426
Total interest expense			2,765				1,624				1,496				7,180				5,820
Net interest income			42,183				37,390				32,859				145,874				122,403
PROVISION FOR LOAN LOSSES			(653	)			386				(843	)			(706	)			(8,077	)
Net interest income after provision for loan losses			42,836				37,004				33,702				146,580				130,480
NONINTEREST INCOME
Card income			2,642				2,569				2,518				10,329				9,734
Wealth management fees			2,485				2,059				2,371				9,155				8,384
Service charges on deposit accounts			1,701				1,927				1,716				7,072				6,080
Mortgage servicing			593				697				730				2,609				2,825
Mortgage servicing rights fair value adjustment			(293	)			351				265				2,153				1,690
Gains on sale of mortgage loans			194				354				927				1,461				5,846
Unrealized gains (losses) on equity securities			33				(107	)			33				(414	)			107
Gains (losses) on foreclosed assets			(122	)			(225	)			184				(314	)			310
Gains (losses) on other assets			17				(31	)			(4	)			136				(723	)
Income on bank owned life insurance			42				41				41				164				41
Other noninterest income			597				599				573				2,366				3,034
Total noninterest income			7,889				8,234				9,354				34,717				37,328
NONINTEREST EXPENSE
Salaries			13,278				12,752				12,486				51,767				48,972
Employee benefits			2,126				1,771				1,964				8,325				6,513
Occupancy of bank premises			1,893				1,979				1,777				7,673				6,788
Furniture and equipment			633				668				793				2,476				2,676
Data processing			2,167				1,631				2,153				7,441				7,329
Marketing and customer relations			867				880				1,085				3,803				3,376
Amortization of intangible assets			140				243				255				873				1,054
FDIC insurance			276				302				280				1,164				1,043
Loan collection and servicing			278				336				219				1,049				1,317
Foreclosed assets			33				97				204				293				908
Other noninterest expense			5,819				3,339				3,165				14,643				11,270
Total noninterest expense			27,510				23,998				24,381				99,507				91,246
INCOME BEFORE INCOME TAX EXPENSE			23,215				21,240				18,675				81,790				76,562
INCOME TAX EXPENSE			6,058				5,613				5,081				21,317				20,291
NET INCOME		$	17,157			$	15,627			$	13,594			$	60,473			$	56,271
EARNINGS PER SHARE - BASIC		$	0.60			$	0.54			$	0.47			$	2.09			$	2.02
EARNINGS PER SHARE - DILUTED		$	0.59			$	0.54			$	0.47			$	2.09			$	2.02
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING			28,752,626				28,787,662				29,036,164				28,853,697				27,795,806

HBT Financial, Inc.
Unaudited Consolidated Financial Summary
Consolidated Balance Sheets

		December 31,				September 30,				December 31,
		2022				2022				2021
		(dollars in thousands)
ASSETS
Cash and due from banks		$	18,970			$	22,169			$	23,387
Interest-bearing deposits with banks			95,189				56,046				385,881
Cash and cash equivalents			114,159				78,215				409,268
Interest-bearing time deposits with banks			—				—				490
Debt securities available-for-sale, at fair value			843,524				853,740				942,168
Debt securities held-to-maturity			541,600				546,694				336,185
Equity securities with readily determinable fair value			3,029				2,996				3,443
Equity securities with no readily determinable fair value			1,977				1,977				1,927
Restricted stock, at cost			7,965				4,050				2,739
Loans held for sale			615				2,297				4,942
Loans, before allowance for loan losses			2,620,253				2,579,928				2,499,689
Allowance for loan losses			(25,333	)			(25,060	)			(23,936	)
Loans, net of allowance for loan losses			2,594,920				2,554,868				2,475,753
Bank owned life insurance			7,557				7,515				7,393
Bank premises and equipment, net			50,469				50,854				52,483
Bank premises held for sale			235				281				1,452
Foreclosed assets			3,030				2,637				3,278
Goodwill			29,322				29,322				29,322
Core deposit intangible assets, net			1,070				1,210				1,943
Mortgage servicing rights, at fair value			10,147				10,440				7,994
Investments in unconsolidated subsidiaries			1,165				1,165				1,165
Accrued interest receivable			19,506				16,881				14,901
Other assets			47,461				48,182				17,408
Total assets		$	4,277,751			$	4,213,324			$	4,314,254
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Deposits:
Noninterest-bearing		$	994,954			$	1,017,710			$	1,087,659
Interest-bearing			2,592,070				2,625,733				2,650,526
Total deposits			3,587,024				3,643,443				3,738,185
Securities sold under agreements to repurchase			43,081				48,130				61,256
Federal Home Loan Bank advances			160,000				60,000				—
Subordinated notes			39,395				39,376				39,316
Junior subordinated debentures issued to capital trusts			37,780				37,763				37,714
Other liabilities			32,822				25,539				25,902
Total liabilities			3,900,102				3,854,251				3,902,373
Stockholders’ Equity
Common stock			293				293				293
Surplus			222,783				222,436				220,891
Retained earnings			236,021				223,495				194,132
Accumulated other comprehensive income (loss)			(71,759	)			(77,462	)			1,471
Treasury stock at cost			(9,689	)			(9,689	)			(4,906	)
Total stockholders’ equity			377,649				359,073				411,881
Total liabilities and stockholders’ equity		$	4,277,751			$	4,213,324			$	4,314,254
SHARE INFORMATION
Shares of common stock outstanding			28,752,626				28,752,626				28,986,061

HBT Financial, Inc.
Unaudited Consolidated Financial Summary

		December 31,			September 30,			December 31,
		2022			2022			2021
		(dollars in thousands)
LOANS
Commercial and industrial		$	266,757		$	240,671		$	286,946
Agricultural and farmland			237,746			245,234			247,796
Commercial real estate - owner occupied			218,503			226,524			234,544
Commercial real estate - non-owner occupied			713,202			718,089			684,023
Multi-family			287,865			260,630			263,911
Construction and land development			360,824			364,290			298,048
One-to-four family residential			338,253			328,667			327,837
Municipal, consumer, and other			197,103			195,823			156,584
Loans, before allowance for loan losses		$	2,620,253		$	2,579,928		$	2,499,689
PPP LOANS (included above)
Commercial and industrial		$	28		$	65		$	28,404
Agricultural and farmland			—			—			913
Municipal, consumer, and other			—			—			171
Total PPP Loans		$	28		$	65		$	29,488

		December 31,			September 30,			December 31,
		2022			2022			2021
		(dollars in thousands)
DEPOSITS
Noninterest-bearing		$	994,954		$	1,017,710		$	1,087,659
Interest-bearing demand			1,139,150			1,131,284			1,105,949
Money market			555,425			584,202			583,198
Savings			634,527			641,139			633,171
Time			262,968			269,108			328,208
Total deposits		$	3,587,024		$	3,643,443		$	3,738,185

HBT Financial, Inc.
Unaudited Consolidated Financial Summary

		Three Months Ended
		December 31, 2022									September 30, 2022									December 31, 2021
		Average									Average									Average
		Balance				Interest			Yield/Cost*		Balance				Interest			Yield/Cost*		Balance				Interest			Yield/Cost*
		(dollars in thousands)
ASSETS
Loans		$	2,600,746			$	36,791		5.61	%	$	2,481,920			$	30,697		4.91	%	$	2,432,025			$	28,546		4.66	%
Securities			1,396,401				7,605		2.16			1,470,092				7,842		2.12			1,285,672				5,642		1.74
Deposits with banks			76,507				504		2.61			105,030				458		1.73			392,729				142		0.14
Other			5,607				48		3.37			2,936				17		2.25			4,821				25		2.10
Total interest-earning assets			4,079,261			$	44,948		4.37	%		4,059,978			$	39,014		3.81	%		4,115,247			$	34,355		3.31	%
Allowance for loan losses			(25,404	)								(24,717	)								(24,826	)
Noninterest-earning assets			188,844									173,461									176,242
Total assets		$	4,242,701								$	4,208,722								$	4,266,663
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Interest-bearing deposits:
Interest-bearing demand		$	1,125,877			$	177		0.06	%	$	1,137,072			$	144		0.05	%	$	1,061,481			$	145		0.05	%
Money market			572,718				379		0.26			577,388				203		0.14			589,396				158		0.11
Savings			640,668				53		0.03			649,752				53		0.03			630,489				53		0.03
Time			266,117				240		0.36			271,870				187		0.27			322,800				295		0.36
Total interest-bearing deposits			2,605,380				849		0.13			2,636,082				587		0.09			2,604,166				651		0.10
Securities sold under agreements to repurchase			51,703				10		0.08			50,427				9		0.07			56,861				11		0.08
Borrowings			92,120				880		3.79			11,967				85		2.80			5,309				7		0.57
Subordinated notes			39,384				470		4.73			39,365				470		4.73			39,305				470		4.74
Junior subordinated debentures issued to capital trusts			37,770				556		5.84			37,755				473		4.97			37,704				357		3.76
Total interest-bearing liabilities			2,826,357			$	2,765		0.39	%		2,775,596			$	1,624		0.23	%		2,743,345			$	1,496		0.22	%
Noninterest-bearing deposits			1,023,355									1,031,407									1,087,468
Noninterest-bearing liabilities			25,078									20,736									25,660
Total liabilities			3,874,790									3,827,739									3,856,473
Stockholders’ Equity			367,911									380,983									410,190
Total liabilities and stockholders’ equity		$	4,242,701								$	4,208,722								$	4,266,663
Net interest income/Net interest margin (1)						$	42,183		4.10	%					$	37,390		3.65	%					$	32,859		3.17	%
Tax-equivalent adjustment (2)							698		0.07							674		0.07							514		0.05
Net interest income (tax-equivalent basis)/ Net interest margin (tax-equivalent basis) (2) (3)						$	42,881		4.17	%					$	38,064		3.72	%					$	33,373		3.22	%
Net interest rate spread (4)									3.98	%								3.58	%								3.09	%
Net interest-earning assets (5)		$	1,252,904								$	1,284,382								$	1,371,902
Ratio of interest-earning assets to interest-bearing liabilities			1.44									1.46									1.50
Cost of total deposits									0.09	%								0.06	%								0.07	%
Cost of funds									0.28									0.17									0.15

---

*   Annualized measure.
(1)   Net interest margin represents net interest income divided by average total interest-earning assets.
(2)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state income tax rate of 9.5%.
(3)   See “Reconciliation of Non-GAAP Financial Measures” below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
(4)   Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(5)   Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.

HBT Financial, Inc.
Unaudited Consolidated Financial Summary

		Year Ended
		December 31, 2022									December 31, 2021
		Average									Average
		Balance				Interest			Yield/Cost		Balance				Interest			Yield/Cost
		(dollars in thousands)
ASSETS
Loans		$	2,514,549			$	123,478		4.91	%	$	2,271,544			$	106,284		4.68	%
Securities			1,403,016				27,937		1.99			1,148,900				21,348		1.86
Deposits with banks			197,030				1,541		0.78			422,828				527		0.12
Other			3,529				98		2.77			3,201				64		2.01
Total interest-earning assets			4,118,124			$	153,054		3.72	%		3,846,473			$	128,223		3.33	%
Allowance for loan losses			(24,703	)								(27,999	)
Noninterest-earning assets			176,427									162,064
Total assets		$	4,269,848								$	3,980,538
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Interest-bearing deposits:
Interest-bearing demand		$	1,141,402			$	607		0.05	%	$	1,024,888			$	518		0.05	%
Money market			582,514				813		0.14			521,366				437		0.08
Savings			650,385				208		0.03			595,887				188		0.03
Time			283,232				883		0.31			295,788				1,329		0.45
Total interest-bearing deposits			2,657,533				2,511		0.09			2,437,929				2,472		0.10
Securities sold under agreements to repurchase			51,554				36		0.07			50,104				34		0.07
Borrowings			26,468				967		3.65			1,653				9		0.54
Subordinated notes			39,355				1,879		4.77			39,275				1,879		4.78
Junior subordinated debentures issued to capital trusts			37,746				1,787		4.73			37,680				1,426		3.79
Total interest-bearing liabilities			2,812,656			$	7,180		0.26	%		2,566,641			$	5,820		0.23	%
Noninterest-bearing deposits			1,051,187									1,004,757
Noninterest-bearing liabilities			22,688									29,060
Total liabilities			3,886,531									3,600,458
Stockholders’ Equity			383,317									380,080
Total liabilities and stockholders’ equity		$	4,269,848									3,980,538
Net interest income/Net interest margin (1)						$	145,874		3.54	%					$	122,403		3.18	%
Tax-equivalent adjustment (2)							2,499		0.06							2,028		0.05
Net interest income (tax-equivalent basis)/ Net interest margin (tax-equivalent basis) (2) (3)						$	148,373		3.60	%					$	124,431		3.23	%
Net interest rate spread (4)									3.46	%								3.10	%
Net interest-earning assets (5)		$	1,305,468								$	1,279,832
Ratio of interest-earning assets to interest-bearing liabilities			1.46									1.50
Cost of total deposits									0.07	%								0.07	%
Cost of funds									0.19									0.16

---

(1)   Net interest margin represents net interest income divided by average total interest-earning assets.
(2)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state income tax rate of 9.5%.
(3)   See “Reconciliation of Non-GAAP Financial Measures” below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
(4)   Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(5)   Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.

HBT Financial, Inc.
Unaudited Consolidated Financial Summary

		December 31,			September 30,			December 31,
		2022			2022			2021
		(dollars in thousands)
NONPERFORMING ASSETS
Nonaccrual		$	2,155		$	3,206		$	2,763
Past due 90 days or more, still accruing (1)			1			—			16
Total nonperforming loans			2,156			3,206			2,779
Foreclosed assets			3,030			2,637			3,278
Total nonperforming assets		$	5,186		$	5,843		$	6,057
Allowance for loan losses		$	25,333		$	25,060		$	23,936
Loans, before allowance for loan losses			2,620,253			2,579,928			2,499,689
CREDIT QUALITY RATIOS
Allowance for loan losses to loans, before allowance for loan losses			0.97	%		0.97	%		0.96	%
Allowance for loan losses to nonaccrual loans			1,175.55			781.66			866.30
Allowance for loan losses to nonperforming loans			1,175.00			781.66			861.32
Nonaccrual loans to loans, before allowance for loan losses			0.08			0.12			0.11
Nonperforming loans to loans, before allowance for loan losses			0.08			0.12			0.11
Nonperforming assets to total assets			0.12			0.14			0.14
Nonperforming assets to loans, before allowance for loan losses, and foreclosed assets			0.20			0.23			0.24

---

(1)   Excludes loans acquired with deteriorated credit quality that are past due 90 or more days, still accruing totaling $145 thousand, $22 thousand, and $32 thousand as of December 31, 2022, September 30, 2022 and December 31, 2021, respectively.

		Three Months Ended												Year Ended
		December 31,				September 30,				December 31,				December 31,
		2022				2022				2021				2022				2021
ALLOWANCE FOR LOAN LOSSES		(dollars in thousands)
Beginning balance		$	25,060			$	24,734			$	24,861			$	23,936			$	31,838
Provision			(653	)			386				(843	)			(706	)			(8,077	)
Charge-offs			(169	)			(222	)			(539	)			(684	)			(1,414	)
Recoveries			1,095				162				457				2,787				1,589
Ending balance		$	25,333			$	25,060			$	23,936			$	25,333			$	23,936
Net charge-offs (recoveries)		$	(926	)		$	60			$	82			$	(2,103	)		$	(175	)
Average loans, before allowance for loan losses			2,600,746				2,481,920				2,432,025				2,514,549				2,271,544
Net charge-offs (recoveries) to average loans, before allowance for loan losses *			(0.14	)	%		0.01		%		0.01		%		(0.08	)	%		(0.01	)	%

---

*   Annualized measure.

Reconciliation of Non-GAAP Financial Measures –
Adjusted Net Income and Adjusted Return on Average Assets

		Three Months Ended												Year Ended
		December 31,				September 30,				December 31,				December 31,
		2022				2022				2021				2022				2021
		(dollars in thousands)
Net income		$	17,157			$	15,627			$	13,594			$	60,473			$	56,271
Adjustments:
Acquisition expenses			(630	)			(462	)			(879	)			(1,092	)			(1,416	)
Branch closure expenses			—				—				—				—				(748	)
Gains (losses) on sales of closed branch premises			—				(38	)			—				141				—
Mortgage servicing rights fair value adjustment			(293	)			351				265				2,153				1,690
Total adjustments			(923	)			(149	)			(614	)			1,202				(474	)
Tax effect of adjustments			177				(80	)			48				(551	)			(95	)
Less adjustments, after tax effect			(746	)			(229	)			(566	)			651				(569	)
Adjusted net income		$	17,903			$	15,856			$	14,160			$	59,822			$	56,840
Average assets		$	4,242,701			$	4,208,722			$	4,266,663			$	4,269,848			$	3,980,538
Return on average assets *			1.60		%		1.47		%		1.26		%		1.42		%		1.41		%
Adjusted return on average assets *			1.67				1.49				1.32				1.40				1.43

---

*   Annualized measure.

Reconciliation of Non-GAAP Financial Measures –
Adjusted Earnings Per Share

		Three Months Ended												Year Ended
		December 31,				September 30,				December 31,				December 31,
		2022				2022				2021				2022				2021
		(dollars in thousands, except per share data)
Numerator:
Net income		$	17,157			$	15,627			$	13,594			$	60,473			$	56,271
Earnings allocated to participating securities (1)			(20	)			(17	)			(23	)			(71	)			(104	)
Numerator for earnings per share - basic and diluted		$	17,137			$	15,610			$	13,571			$	60,402			$	56,167
Adjusted net income		$	17,903			$	15,856			$	14,160			$	59,822			$	56,840
Earnings allocated to participating securities (1)			(21	)			(17	)			(24	)			(70	)			(105	)
Numerator for adjusted earnings per share - basic and diluted		$	17,882			$	15,839			$	14,136			$	59,752			$	56,735
Denominator:
Weighted average common shares outstanding			28,752,626				28,787,662				29,036,164				28,853,697				27,795,806
Dilutive effect of outstanding restricted stock units			91,905				72,643				27,577				65,619				15,487
Weighted average common shares outstanding, including all dilutive potential shares			28,844,531				28,860,305				29,063,741				28,919,316				27,811,293
Earnings per share - Basic		$	0.60			$	0.54			$	0.47			$	2.09			$	2.02
Earnings per share - Diluted		$	0.59			$	0.54			$	0.47			$	2.09			$	2.02
Adjusted earnings per share - Basic		$	0.62			$	0.55			$	0.49			$	2.07			$	2.04
Adjusted earnings per share - Diluted		$	0.62			$	0.55			$	0.49			$	2.07			$	2.04

---

(1)   The Company has granted certain restricted stock units that contain non-forfeitable rights to dividend equivalents. Such restricted stock units are considered participating securities. As such, we have included these restricted stock units in the calculation of basic earnings per share and calculate basic earnings per share using the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings.

Reconciliation of Non-GAAP Financial Measures –
Net Interest Income and Net Interest Margin (Tax Equivalent Basis)

		Three Months Ended									Year Ended
		December 31,			September 30,			December 31,			December 31,
		2022			2022			2021			2022			2021
		(dollars in thousands)
Net interest income (tax equivalent basis)
Net interest income		$	42,183		$	37,390		$	32,859		$	145,874		$	122,403
Tax-equivalent adjustment (1)			698			674			514			2,499			2,028
Net interest income (tax equivalent basis) (1)		$	42,881		$	38,064		$	33,373		$	148,373		$	124,431
Net interest margin (tax equivalent basis)
Net interest margin *			4.10	%		3.65	%		3.17	%		3.54	%		3.18	%
Tax-equivalent adjustment * (1)			0.07			0.07			0.05			0.06			0.05
Net interest margin (tax equivalent basis) * (1)			4.17	%		3.72	%		3.22	%		3.60	%		3.23	%
Average interest-earning assets		$	4,079,261		$	4,059,978		$	4,115,247		$	4,118,124		$	3,846,473

---

*   Annualized measure.
(1)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.

Reconciliation of Non-GAAP Financial Measures –
Efficiency Ratio (Tax Equivalent Basis)

		Three Months Ended									Year Ended
		December 31,			September 30,			December 31,			December 31,
		2022			2022			2021			2022			2021
		(dollars in thousands)
Efficiency ratio (tax equivalent basis)
Total noninterest expense		$	27,510		$	23,998		$	24,381		$	99,507		$	91,246
Less: amortization of intangible assets			140			243			255			873			1,054
Adjusted noninterest expense		$	27,370		$	23,755		$	24,126		$	98,634		$	90,192
Net interest income		$	42,183		$	37,390		$	32,859		$	145,874		$	122,403
Total noninterest income			7,889			8,234			9,354			34,717			37,328
Operating revenue			50,072			45,624			42,213			180,591			159,731
Tax-equivalent adjustment (1)			698			674			514			2,499			2,028
Operating revenue (tax equivalent basis) (1)		$	50,770		$	46,298		$	42,727		$	183,090		$	161,759
Efficiency ratio			54.66	%		52.07	%		57.15	%		54.62	%		56.46	%
Efficiency ratio (tax equivalent basis) (1)			53.91			51.31			56.47			53.87			55.76

---

(1)   On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.

Reconciliation of Non-GAAP Financial Measures –
Tangible Common Equity to Tangible Assets and Tangible Book Value Per Share

		December 31,			September 30,			December 31,
		2022			2022			2021
		(dollars in thousands, except per share data)
Tangible common equity
Total stockholders’ equity		$	377,649		$	359,073		$	411,881
Less: Goodwill			29,322			29,322			29,322
Less: Core deposit intangible assets, net			1,070			1,210			1,943
Tangible common equity		$	347,257		$	328,541		$	380,616
Tangible assets
Total assets		$	4,277,751		$	4,213,324		$	4,314,254
Less: Goodwill			29,322			29,322			29,322
Less: Core deposit intangible assets, net			1,070			1,210			1,943
Tangible assets		$	4,247,359		$	4,182,792		$	4,282,989
Total stockholders’ equity to total assets			8.83	%		8.52	%		9.55	%
Tangible common equity to tangible assets			8.18			7.85			8.89
Shares of common stock outstanding			28,752,626			28,752,626			28,986,061
Book value per share		$	13.13		$	12.49		$	14.21
Tangible book value per share			12.08			11.43			13.13

Reconciliation of Non-GAAP Financial Measures –
Return on Average Tangible Common Equity,
Adjusted Return on Average Stockholders’ Equity and Adjusted Return on Tangible Common Equity

		Three Months Ended									Year Ended
		December 31,			September 30,			December 31,			December 31,
		2022			2022			2021			2022			2021
		(dollars in thousands)
Average tangible common equity
Total stockholders’ equity		$	367,911		$	380,983		$	410,190		$	383,317		$	380,080
Less: Goodwill			29,322			29,322			29,322			29,322			25,057
Less: Core deposit intangible assets, net			1,134			1,356			2,092			1,480			2,333
Average tangible common equity		$	337,455		$	350,305		$	378,776		$	352,515		$	352,690
Net income		$	17,157		$	15,627		$	13,594		$	60,473		$	56,271
Adjusted net income			17,903			15,856			14,160			59,822			56,840
Return on average stockholders’ equity *			18.50	%		16.27	%		13.15	%		15.78	%		14.81	%
Return on average tangible common equity *			20.17			17.70			14.24			17.15			15.95
Adjusted return on average stockholders’ equity *			19.31	%		16.51	%		13.70	%		15.61	%		14.95	%
Adjusted return on average tangible common equity *			21.05			17.96			14.83			16.97			16.12

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*   Annualized measure.

FAQ

What were HBT Financial's earnings for Q4 2022?

HBT Financial reported a net income of $17.2 million or $0.59 per diluted share for Q4 2022.

When is the next dividend payment for HBT Financial?

The next dividend payment of $0.17 per share is scheduled for February 14, 2023.

What is the stock symbol for HBT Financial?

The stock symbol for HBT Financial is HBT.

What is HBT Financial's net interest margin?

HBT Financial's net interest margin for Q4 2022 increased to 4.10%.

When is the acquisition of Town and Country expected to close?

The acquisition of Town and Country Financial is expected to close on February 1, 2023.