HomeTrust Bancshares, Inc. Announces Financial Results for the Third Quarter of Fiscal 2022 and Quarterly Dividend

Rhea-AI Summary

HomeTrust Bancshares, Inc. (NASDAQ: HTBI) reported a net income of $8.0 million for Q3 2022, a slight increase from $7.9 million in Q3 2021. Diluted EPS rose to $0.51 from $0.48. Total assets increased to $3.5 billion, with deposits up 3.5%, totaling $3.1 billion. Noninterest income decreased to $8.9 million, impacted by lower loan sale gains. The Board declared a quarterly dividend of $0.09 per share. The company's credit quality improved, with nonperforming assets down 54.6% year-over-year. HTBI remains well-capitalized with robust commercial loan growth.

Positive

• Net income increased to $29.6 million for the nine months ended March 31, 2022, up from $23.1 million.
• Diluted EPS rose to $1.84 for the nine months ended March 31, 2022, compared to $1.40 year-over-year.
• Commercial loan growth (excluding PPP loans) was strong, with a 7.5% annualized increase for the nine months ended March 31, 2022.
• Noninterest income increased 2.9% year-over-year to $29.5 million for the nine months ended March 31, 2022.

Negative

• Noninterest income decreased by 16.2% to $8.9 million for Q3 2022, mainly due to reduced gains on loan sales.
• The provision for credit losses showed a net benefit of $4.0 million, down from $6.2 million year-over-year.

ASHEVILLE, N.C., April 27, 2022 (GLOBE NEWSWIRE) -- HomeTrust Bancshares, Inc. (NASDAQ: HTBI) ("Company"), the holding company of HomeTrust Bank ("Bank"), today announced preliminary net income for the third quarter of fiscal 2022 and approval of its quarterly dividend.

For the quarter ended March 31, 2022 compared to the corresponding quarter in the previous year:

• net income was $8.0 million, compared to $7.9 million;
• diluted earnings per share ("EPS") was $0.51, compared to $0.48;
• annualized return on assets ("ROA") was 0.92%, compared to 0.84%;
• annualized return on equity ("ROE") was 8.15%, compared to 7.78%;
• provision for credit losses was a net benefit of $45,000, compared to a net benefit of $4.1 million;
• noninterest income was $8.9 million compared to $10.7 million;
• prepayment penalty on the early retirement of borrowings was $0 compared to $3.7 million;
• 419,931 shares of Company common stock were repurchased during the quarter at an average price of $30.76 per share;
• net commercial loan growth, excluding U.S. Small Business Administration's ("SBA") Paycheck Protection Program ("PPP") loans, was $29.8 million, or 6.0% annualized compared to $42.7 million, or 9.7% annualized, in the prior year; and
• quarterly cash dividends continued at $0.09 per share, totaling $1.4 million.

For the nine months ended March 31, 2022 compared to the previous year:

• net income was $29.6 million, compared to $23.1 million;
• diluted earnings per share ("EPS") was $1.84, compared to $1.40;
• annualized return on assets ("ROA") was 1.12%, compared to 0.83%;
• annualized return on equity ("ROE") was 9.91%, compared to 7.64%;
• provision for credit losses was a net benefit of $4.0 million, compared to a net benefit of $6.2 million;
• noninterest income was $29.5 million compared to $28.7 million;
• prepayment penalty on the early retirement of borrowings was $0 compared to $3.7 million;
• 1,095,763 shares of Company common stock were repurchased during the nine months at an average price of $29.50 per share; and
• net commercial loan growth, excluding PPP loans, was $108.7 million, or 7.5% annualized compared to $31.7 million, or 2.4% annualized in the prior year.
  

The Company also announced today that its Board of Directors declared a quarterly cash dividend of $0.09 per common share payable on June 2, 2022 to shareholders of record as of the close of business on May 19, 2022.

“The Company was able to maintain it’s positive momentum this past quarter,” said Dana Stonestreet, Chairman and Chief Executive Officer. “Our commercial loan portfolio had another strong quarter of net growth, primarily within the construction and development and equipment finance portfolios. As expected, upward movement in interest rates resulted in a decline in both the volume of residential mortgage sales and the value of our investment portfolio; however, due to the short-term duration of our investments, our tangible book value per share actually increased even after repurchasing $12.9 million of shares during the quarter. The Company is well-positioned to benefit from an increase in yield on our loan and investment portfolios going forward.”

Comparison of Results of Operations for the Three Months Ended March 31, 2022 and 2021

Net interest income increased by $1.3 million, or 5.2%, to $27.0 million for the quarter ended March 31, 2022, compared to $25.7 million for the comparative quarter in fiscal 2021. Interest and dividend income decreased by $1.1 million, or 3.8%, primarily driven by lower average balances on interest-earning assets combined with lower loan yields. This decrease was offset by a $2.5 million, or 68.2% decrease in interest expense. Average interest-earning assets decreased $225.4 million, or 6.4%, to $3.3 billion for the quarter ended March 31, 2022. The main drivers of the change were decreases of $179.4 million, or 34.3%, in the average balance of commercial paper and deposits in other banks and $42.0 million, or 27.3%, in debt securities available for sale as the Company used excess liquidity to reduce borrowings, which declined by $431.5 million, or 92.8%, when compared to the prior period. Net interest margin (on a fully taxable-equivalent basis) for the three months ended March 31, 2022 increased to 3.39% from 3.02% for the same period a year ago as all higher rate long-term borrowings were repaid during the quarter ended June 30, 2021.

Total interest and dividend income decreased $1.1 million, or 3.8%, for the quarter ended March 31, 2022 as compared to the same quarter last year, which was primarily a result of a $1.0 million, or 3.7%, decrease in loan interest income. The lower loan interest income was driven by a decline in the average yield on loans of 17 basis points, from 4.08% to 3.91%. Loan interest income for the quarter included the amortization of $265,000 of PPP loan origination fees, a decline of $349,000 when compared to the $614,000 recognized in the prior period. The overall average yield on interest-earning assets increased 10 basis points to 3.54% for the current quarter compared to 3.44% in the same quarter last year primarily due to the change in the mix of interest-earning assets.

Total interest expense decreased $2.5 million, or 68.2%, for the quarter ended March 31, 2022 compared to the same period last year. The decrease was driven by a $1.6 million, or 99.8%, decrease in interest expense on borrowings as discussed above and a $845,000, or 42.3%, decrease in interest expense on deposits. The average balance of total deposits increased by $228.1 million, or 8.1%, with noninterest-bearing deposits and interest-bearing deposits increasing $161.7 million and $66.4 million, respectively. The increase in interest-bearing deposits was driven by a $113.5 million, or 12.5% increase in money market accounts, partially offset by a $74.9 million, or 14.5%, decrease in certificates of deposit. As stated above, average borrowings for the quarter ended March 31, 2022 decreased $431.5 million, or 92.8%, along with a 137 basis point decrease in the average cost of borrowings compared to the same period last year. The decrease in the average cost of borrowings was primarily driven by the early retirement of long-term borrowings reducing the average balance and partially driven by a shift to short-term borrowings at lower rates. The overall average cost of funds decreased 34 basis points to 0.20% for the current quarter compared to 0.54% in the same quarter last year.

Noninterest income decreased $1.7 million, or 16.2%, to $8.9 million for the quarter ended March 31, 2022 from $10.7 million for the same period in the previous year. This change was primarily due to a $1.9 million, or 39.2%, decrease in gain on sale of loans, partially offset by a $229,000, or 16.0%, increase in operating lease income. The decrease in gain on sale of loans was driven by decreases in loan principal sold across all portfolios. During the quarter ended March 31, 2022, $53.4 million of residential mortgage loans originated for sale were sold with gains of $1.3 million compared to $106.5 million sold and gains of $2.7 million in the corresponding period in the prior year. There were $16.5 million of sales of the guaranteed portion of SBA commercial loans with gains of $1.5 million in the current quarter compared to $20.2 million sold and gains of $1.8 million for the same period last year. The Company sold $25.0 million of home equity lines of credit (HELOC) during the quarter for a gain of $156,000 compared to $43.8 million sold and gains of $301,000 in the corresponding period last year.

Noninterest expense decreased $4.7 million, or 15.4%, for the quarter ended March 31, 2022 as compared to the same period last year, which was primarily a result of a decrease of $3.7 million in prepayment penalties on long-term borrowings, and a $1.1 million, or 6.7%, decrease in salaries and benefits expense due to branch closures and lower mortgage banking incentive pay in the period.

For the quarter ended March 31, 2022, the Company's income tax expense increased $114,000, or 5.4%, to $2.2 million from $2.1 million primarily as a result of higher taxable income. The effective tax rates for the quarters ended March 31, 2022 and 2021 were 21.6% and 21.0%, respectively.

Comparison of Results of Operations for the Nine Months Ended March 31, 2022 and 2021

Net interest income increased by $4.6 million, or 5.9%, to $81.9 million for the nine months ended March 31, 2022, compared to the same period last year. Interest and dividend income decreased by $3.9 million, or 4.4%, primarily driven by lower average balances on interest-earning assets. This decrease was offset by a $8.5 million, or 67.7%, decrease in interest expense. Average interest-earning assets decreased $184.0 million, or 5.3%, to $3.3 billion for the nine months ended March 31, 2022. The biggest reason for the change was a decrease of $143.2 million, or 31.5%, in commercial paper and deposits in other banks, as the Company used excess liquidity to reduce borrowings, where the average balance declined from $471.7 million to $48.9 million. Net interest margin (on a fully taxable-equivalent basis) for the nine months ended March 31, 2022 increased to 3.38% from 3.02% for the same period a year ago as all higher rate long-term borrowings were repaid during the quarter ended June 30, 2021.

Total interest and dividend income decreased $3.9 million, or 4.4%, for the nine months ended March 31, 2022 as compared to the same period last year, which was primarily a result of a $3.1 million, or 3.7%, decrease in loan interest income and a $744,000, or 35.3%, decrease in interest income on commercial paper and deposits in other banks. The lower interest income in each category was driven by the combined effect of a decrease in average balances, as discussed above, and a decline in average loan yields which decreased 13 basis points to 3.90%, and average yields on debt securities available for sale which decreased 13 basis points to 1.42%. Loan interest income for the nine months included the amortization of $975,000 of PPP loan origination fees, a decline of $381,000 when compared to the $1.4 million recognized in the prior period. The overall average yield on interest-earning assets increased three basis points to 3.54% for the nine months compared to 3.51% in the same period last year as a result of a shift to higher yielding assets.

Total interest expense decreased $8.5 million, or 67.7%, for the nine months ended March 31, 2022 compared to the same period last year. The decrease was driven by a $5.0 million, or 99.1%, decrease in interest expense on borrowings as discussed above and a $3.6 million, or 47.0%, decrease in interest expense on deposits. The average balance of total deposits increased by $257.5 million, or 9.3%, with noninterest-bearing deposits and interest-bearing deposits increasing $197.5 million and $60.0 million, respectively. The increase in interest-bearing deposits was driven by a $142.4 million, or 16.6%, increase in money market accounts and $46.4 million, or 7.8%, increase in interest-bearing checking accounts, partially offset by a $146.9 million, or 24.7%, decrease in certificates of deposit. As stated above average borrowings for the nine months ended March 31, 2022 decreased $422.8 million, or 89.6%, along with a 129 basis point decrease in the average cost of borrowings compared to the same period last year. The increase in average deposits (interest and noninterest-bearing) was due to successful deposit gathering campaigns and the effect of government stimulus in prior periods. The decrease in the average cost of borrowings was primarily driven by the early retirement of long-term borrowings reducing the average balance and partially driven by a shift to short-term borrowings at lower rates. The overall average cost of funds decreased 39 basis points to 0.23% for the nine months compared to 0.62% in the same period last year.

Noninterest income increased $819,000, or 2.9%, to $29.5 million for the nine months ended March 31, 2022 from $28.7 million for the same period in the previous year. This change was due to an $857,000, or 51.0%, increase in loan income and fees, an $813,000, or 19.8% increase in operating lease income, a $394,000, or 5.9% increase in service charges and fees on deposit accounts, partially offset by a $1.0 million, or 8.4%, decrease in gain on sale of loans. The increase in loan income and fees was primarily a result of $924,000 in additional loan servicing fees as a result of bringing the Company's SBA loan servicing process in-house, which began July 1, 2021. The increase in operating lease income was primarily driven by increases in loan originations and higher outstanding lease balances during the period, while the increase in service charges on deposit accounts was the result of a $234,000 increase in interchange income driven by higher debit card usage. During the nine months ended March 31, 2022, $204.1 million of residential mortgage loans originated for sale were sold with gains of $5.6 million compared to $297.2 million sold and gains of $7.7 million in the corresponding period in the prior year. There were $43.5 million of sales of the guaranteed portion of SBA commercial loans with gains of $4.5 million in the nine months compared to $44.6 million sold and gains of $3.7 million for the same period last year. The Company sold $97.2 million of HELOCs during the nine months ended March 31, 2022 for a gain of $581,000 compared to $85.9 million sold and gains of $559,000 in the corresponding period last year. Lastly, $11.5 million of indirect auto finance loans were sold out of the held for investment portfolio during the current period for a gain of $205,000. No such sales occurred in the same period in the prior year.

Noninterest expense decreased $5.2 million, or 6.3%, for the nine months ended March 31, 2022 as compared to the same period last year, which was primarily a result of a decrease of $3.7 million in prepayment penalties on borrowings, a $1.8 million, or 3.9%, decrease in salaries and benefits expense due to branch closures and lower mortgage banking incentive pay in the period, and a reduction of core deposit amortization expense of $397,000, or 65.6%, partially offset by an increase of $1.1 million, or 117.2%, in marketing and advertising expense driven by reduced media advertising in prior periods as a result of the pandemic as well as current year advertising for newly opened locations.

For the nine months ended March 31, 2022, the Company's income tax expense increased $1.9 million, or 31.2%, to $8.0 million from $6.1 million primarily as a result of higher taxable income. The effective tax rates for the nine months ended March 31, 2022 and 2021 were 21.4% and 21.0%, respectively.

Balance Sheet Review

Total assets and liabilities increased by $17.1 million and $18.5 million to $3.5 billion and $3.1 billion, respectively, at March 31, 2022 as compared to June 30, 2021. Deposits increased by $103.6 million, or 3.5%, which were used to continue paying down borrowings during the period. In addition, excess liquidity from a $50.1 million, or 32.0%, decrease in debt securities available for sale, a $33.7 million, or 1.2%, decrease in loans receivable, a $12.0 million, or 29.9%, decrease in certificates of deposits in other banks, and a $8.3 million, or 8.8%, decrease in loans held for sale was invested in commercial paper which increased by $123.3 million, or 65.0%, during the period.

The decrease in loans was driven by PPP forgiveness of $43.9 million and a $98.5 million, or 12.9%, decrease in retail consumer loans primarily within the one-to-four family loans and indirect auto loan portfolios. This decrease was partially offset by a $108.7 million, or 5.7%, increase in commercial loans (excluding PPP loans) as the Company continues its focus on the growth of the commercial loan segment.

Stockholders' equity decreased $1.4 million, or 0.4%, to $395.1 million at March 31, 2022 as compared to June 30, 2021. Activity within stockholders' equity included $29.6 million in net income, $6.7 million in stock-based compensation expense and option exercises, stock repurchases of $32.3 million, and $4.1 million in cash dividends declared. As of March 31, 2022, the Bank was considered "well capitalized" in accordance with its regulatory capital guidelines and exceeded all regulatory capital requirements.

Asset Quality

The allowance for credit losses on loans was $31.0 million, or 1.15%, of total loans at March 31, 2022 compared to $35.5 million, or 1.30%, of total loans at June 30, 2021. The overall decrease was driven by lower expected credit losses estimated by management based on an improving economic outlook.

The provision for credit losses was a net benefit of $4.0 million for the nine months ended March 31, 2022, compared to a net benefit of $6.2 million for the corresponding period in fiscal year 2021. Net loan charge-offs totaled $19,000 for the nine months ended March 31, 2022, compared to $452,000 for the same period last year. Net charge-offs as a percentage of average loans were 0.00% for the nine months ended March 31, 2022 compared to 0.02% for the corresponding period last year.

Nonperforming assets decreased by $7.0 million, or 54.6%, to $5.8 million, or 0.16%, of total assets at March 31, 2022 compared to $12.8 million, or 0.36% of total assets at June 30, 2021. The significant decrease from June 30, 2021 was primarily a result of the payoff of two commercial real estate loan relationships totaling $5.1 million during the nine month period. Nonperforming assets included $5.8 million in nonaccruing loans and no REO at March 31, 2022, compared to $12.6 million and $188,000 in nonaccruing loans and REO, respectively, at June 30, 2021. Nonperforming loans to total loans was 0.22% at March 31, 2022 and 0.46% at June 30, 2021.

As of March 31, 2022, the Company had no loans with full principal and interest payment deferrals related to COVID-19 which had been granted prior to January 1, 2022, compared to $107,000 at June 30, 2021. All loans placed on full payment deferral during the pandemic have come out of deferral and borrowers are either making regular loan payments or interest-only payments. As of March 31, 2022, the Company had $9.6 million in commercial loan deferrals on interest-only payments compared to $78.9 million at June 30, 2021.

The ratio of classified assets to total assets decreased to 0.61% at March 31, 2022 from 0.76% at June 30, 2021. Classified assets decreased $5.0 million, or 18.5%, to $21.7 million at March 31, 2022 compared to $26.7 million at June 30, 2021 primarily due to the payoff of two commercial real estate loan relationships discussed above.

About HomeTrust Bancshares, Inc.

HomeTrust Bancshares, Inc. is the holding company for the Bank. As of March 31, 2022, the Company had assets of $3.5 billion. The Bank, founded in 1926, is a North Carolina state chartered, community-focused financial institution committed to providing value added relationship banking with over 30 locations as well as online/mobile channels. Locations include: North Carolina (including the Asheville metropolitan area, the "Piedmont" region, Charlotte, and Raleigh/Cary), Upstate South Carolina (Greenville), East Tennessee (including Kingsport/Johnson City, Knoxville, and Morristown) and Southwest Virginia (including the Roanoke Valley).

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements often include words such as "believe," "expect," "anticipate," "estimate," and "intend" or future or conditional verbs such as "will," "would," "should," "could," or "may." Forward-looking statements are not historical facts but instead represent management's current expectations and forecasts regarding future events, many of which are inherently uncertain and outside of the Company's control. Actual results may differ, possibly materially, from those currently expected or projected in these forward-looking statements. Factors that could cause the Company's actual results to differ materially from those described in the forward-looking statements include: the effect of the COVID-19 pandemic, including on the Company's credit quality and business operations, as well as its impact on general economic and financial market conditions and other uncertainties resulting from the COVID-19 pandemic, such as the extent and duration of the impact on public health, the U.S. and global economies, and consumer and corporate customers, including economic activity, employment levels and market liquidity; increased competitive pressures; changes in the interest rate environment; changes in general economic conditions and conditions within the securities markets; legislative and regulatory changes; and other factors described in the Company's latest annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other documents filed with or furnished to the Securities and Exchange Commission - which are available on the Company's website at www.htb.com and on the SEC's website at www.sec.gov. These risks could cause the Company's actual results for fiscal 2022 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of, the Company and could negatively affect its operating and stock performance. Any of the forward-looking statements that the Company makes in this press release or the documents they file with or furnish to the SEC are based upon management's beliefs and assumptions at the time they are made and may turn out to be wrong because of inaccurate assumptions they might make, because of the factors described above or because of other factors that they cannot foresee. The Company does not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

WEBSITE: WWW.HTB.COM

Consolidated Balance Sheets (Unaudited)

(Dollars in thousands)	March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021(1)				March 31, 2021
Assets
Cash	$	19,783			$	20,586			$	22,431			$	22,312			$	24,621
Interest-bearing deposits		32,267				14,240				20,142				28,678				139,474
Cash and cash equivalents		52,050				34,826				42,573				50,990				164,095
Commercial paper		312,918				254,157				196,652				189,596				238,445
Certificates of deposit in other banks		28,125				34,002				35,495				40,122				42,015
Debt securities available for sale, at fair value		106,315				121,851				124,576				156,459				162,417
Other investments, at cost		23,040				22,117				20,891				23,710				28,899
Loans held for sale		85,263				102,070				105,161				93,539				86,708
Total loans, net of deferred loan fees and costs		2,699,538				2,696,072				2,719,642				2,733,267				2,690,153
Allowance for credit losses - loans		(31,034	)			(30,933	)			(34,406	)			(35,468	)			(36,059	)
Loans, net		2,668,504				2,665,139				2,685,236				2,697,799				2,654,094
Premises and equipment, net		69,629				69,461				68,568				70,909				70,886
Accrued interest receivable		7,980				8,200				8,429				7,933				8,271
Real estate owned ("REO")		—				45				45				188				143
Deferred income taxes, net		12,494				12,019				15,722				16,901				16,889
Bank owned life insurance ("BOLI")		94,740				94,209				93,679				93,108				93,877
Goodwill		25,638				25,638				25,638				25,638				25,638
Core deposit intangibles, net		135				185				250				343				473
Other assets		54,954				58,900				58,445				57,488				55,763
Total assets	$	3,541,785			$	3,502,819			$	3,481,360			$	3,524,723			$	3,648,613
Liabilities and stockholders' equity
Liabilities
Deposits	$	3,059,157			$	2,998,691			$	2,987,284			$	2,955,541			$	2,908,478
Borrowings		30,000				48,000				40,000				115,000				275,000
Other liabilities		57,497				54,382				57,565				57,663				58,683
Total liabilities		3,146,654				3,101,073				3,084,849				3,128,204				3,242,161
Stockholders' equity
Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued or outstanding		—				—				—				—				—
Common stock, $0.01 par value, 60,000,000 shares authorized (2)		160				163				163				167				167
Additional paid in capital		136,181				147,552				151,425				160,582				162,010
Retained earnings		265,609				258,986				249,331				240,075				248,767
Unearned Employee Stock Ownership Plan ("ESOP") shares		(5,422	)			(5,555	)			(5,687	)			(5,819	)			(5,951	)
Accumulated other comprehensive income (loss)		(1,397	)			600				1,279				1,514				1,459
Total stockholders' equity		395,131				401,746				396,511				396,519				406,452
Total liabilities and stockholders' equity	$	3,541,785			$	3,502,819			$	3,481,360			$	3,524,723			$	3,648,613

_________________________________

(1)    Derived from audited financial statements.
(2)    Shares of common stock issued and outstanding were 15,978,262 at March 31, 2022; 16,303,461 at December 31, 2021; 16,307,658 at September 30, 2021; 16,636,483 at June 30, 2021; and 16,655,347 at March 31, 2021.    


Consolidated Statements of Income (Unaudited)

	Three Months Ended												Nine Months Ended
(Dollars in thousands)	March 31, 2022				December 31, 2021				March 31, 2021				March 31, 2022				March 31, 2021
Interest and dividend income
Loans	$	26,616			$	26,929			$	27,629			$	81,440			$	84,564
Commercial paper and interest-bearing deposits		563				468				611			$	1,362				2,106
Debt securities available for sale		384				411				496				1,319				1,528
Other investments		632				680				585				1,867				1,729
Total interest and dividend income		28,195				28,488				29,321				85,988				89,927
Interest expense
Deposits		1,151				1,305				1,996				4,028				7,596
Borrowings		4				15				1,632				45				5,007
Total interest expense		1,155				1,320				3,628				4,073				12,603
Net interest income		27,040				27,168				25,693				81,915				77,324
Provision (benefit) for credit losses		(45	)			(2,500	)			(4,100	)			(4,005	)			(6,180	)
Net interest income after provision (benefit) for credit losses		27,085				29,668				29,793				85,920				83,504
Noninterest income
Service charges and fees on deposit accounts		2,216				2,513				2,194				7,101				6,707
Loan income and fees		752				805				636				2,536				1,679
Gain on sale of loans held for sale		2,969				3,901				4,881				10,927				11,929
BOLI income		492				490				508				1,500				1,551
Operating lease income		1,661				1,718				1,432				4,920				4,107
Other		857				753				1,027				2,496				2,688
Total noninterest income		8,947				10,180				10,678				29,480				28,661
Noninterest expense
Salaries and employee benefits		14,730				14,872				15,784				44,882				46,691
Occupancy expense, net		2,483				2,401				2,456				7,201				7,010
Computer services		2,455				2,369				2,581				7,148				7,108
Telephone, postage, and supplies		686				735				812				2,133				2,345
Marketing and advertising		573				832				319				2,110				971
Deposit insurance premiums		412				302				363				1,280				1,361
REO related expense, net		220				116				84				478				462
Core deposit intangible amortization		50				65				165				208				605
Prepayment penalties on borrowings		—				—				3,656				—				3,656
Other		4,190				4,217				4,286				12,285				12,740
Total noninterest expense		25,799				25,909				30,506				77,725				82,949
Net income before income taxes		10,233				13,939				9,965				37,675				29,216
Income tax expense		2,210				2,861				2,096				8,047				6,133
Net income	$	8,023			$	11,078			$	7,869			$	29,628			$	23,083

 

Per Share Data

		Three Months Ended									Nine Months Ended
		March 31, 2022			December 31, 2021			March 31, 2021			March 31, 2022			March 31, 2021
Net income per common share:(1)
Basic		$	0.51		$	0.70		$	0.49		$	1.87		$	1.42
Diluted		$	0.51		$	0.68		$	0.48		$	1.84		$	1.40
Average shares outstanding:
Basic			15,523,813			15,632,283			15,979,590			15,666,093			16,139,059
Diluted			15,793,012			15,989,606			16,485,718			15,997,377			16,339,130
Book value per share at end of period		$	24.73		$	24.64		$	24.40		$	24.73		$	24.40
Tangible book value per share at end of period (2)		$	23.12		$	23.06		$	22.84		$	23.13		$	22.84
Cash dividends declared per common share		$	0.09		$	0.09		$	0.08		$	0.26		$	0.23
Total shares outstanding at end of period			15,978,262			16,303,461			16,655,347			15,978,262			16,655,347

_________________________________

(1)    Basic and diluted net income per common share have been prepared in accordance with the two-class method.
(2)    See Non-GAAP reconciliation tables below for adjustments.    


Selected Financial Ratios and Other Data

		Three Months Ended									Nine Months Ended
		March 31, 2022			December 31, 2021			March 31, 2021			March 31, 2022			March 31, 2021
Performance ratios: (1)
Return on assets (ratio of net income to average total assets)		0.92	%		1.24	%		0.84	%		1.12	%		0.83	%
Return on equity (ratio of net income to average equity)		8.15			11.02			7.78			9.91			7.64
Tax equivalent yield on earning assets(2)		3.54			3.49			3.44			3.54			3.51
Rate paid on interest-bearing liabilities		0.20			0.22			0.54			0.23			0.62
Tax equivalent average interest rate spread (2)		3.34			3.27			2.90			3.31			2.89
Tax equivalent net interest margin(2) (3)		3.39			3.33			3.02			3.38			3.02
Average interest-earning assets to average interest-bearing liabilities		137.72			139.06			127.59			138.24			126.60
Noninterest expense to average total assets		2.97			2.91			3.25			2.94			2.98
Efficiency ratio		71.69			69.37			83.87			69.77			78.26
Efficiency ratio - adjusted (4)		71.06			68.81			73.17			69.19			74.16

_________________________________

(1)    Ratios are annualized where appropriate.
(2)    The weighted average rate for municipal leases is adjusted for a 24% combined federal and state tax rate since the interest from these leases is tax exempt.
(3)    Net interest income divided by average interest-earning assets.
(4)    See Non-GAAP reconciliation tables below for adjustments.   

	Three Months Ended
	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021(1)			March 31, 2021
Asset quality ratios:
Nonperforming assets to total assets(1)	0.16	%		0.18	%		0.19	%		0.36	%		0.37	%
Nonperforming loans to total loans(1)	0.22			0.23			0.25			0.46			0.49
Total classified assets to total assets	0.61			0.65			0.65			0.76			0.76
Allowance for credit losses to nonperforming loans(1)	534.06			500.70			510.63			281.38			272.64
Allowance for credit losses to total loans	1.15			1.15			1.27			1.30			1.34
Net charge-offs (recoveries) to average loans (annualized)	(0.11	)		0.15			(0.04	)		(0.04	)		(0.03	)
Capital ratios:
Equity to total assets at end of period	11.16	%		11.47	%		11.39	%		11.25	%		11.14	%
Tangible equity to total tangible assets(2)	10.51			10.81			10.73			10.59			10.50
Average equity to average assets	11.32			11.28			11.27			11.06			10.79

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(1)    Nonperforming assets include nonaccruing loans, consisting of certain restructured loans, and REO. There were no accruing loans more than 90 days past due at the dates indicated. At March 31, 2022, there were $1.8 million of restructured loans included in nonaccruing loans and $2.9 million, or 50.6% of nonaccruing loans were current on their loan payments.
(2)    See Non-GAAP reconciliation tables below for adjustments.

Average Balance Sheet Data

	Three Months Ended
(Dollars in thousands)	March 31, 2022										March 31, 2021
	Average Balance Outstanding				Interest Earned/ Paid(2)			Yield/ Rate(2)			Average Balance Outstanding				Interest Earned/ Paid(2)			Yield/ Rate(2)
Assets:
Interest-earning assets:
Loans receivable(1)(2)	$	2,791,650			$	26,936		3.91	%		$	2,779,094			$	27,955		4.08	%
Commercial paper and deposits in other banks		342,878				563		0.67				522,256				611		0.47
Debt securities available for sale		111,874				384		1.39				153,871				496		1.31
Other interest-earning assets(3)		22,614				632		11.33				39,184				585		6.05
Total interest-earning assets		3,269,016				28,515		3.54	%			3,494,405				29,647		3.44	%
Other assets		258,126										258,858
Total assets	$	3,527,142									$	3,753,263
Liabilities and equity:
Interest-bearing deposits:
Interest-bearing checking accounts		650,072				310		0.19	%			637,381				391		0.25	%
Money market accounts		1,020,734				340		0.14				907,228				373		0.17
Savings accounts		227,936				40		0.07				212,809				39		0.08
Certificate accounts		441,314				461		0.42				516,221				1,193		0.94
Total interest-bearing deposits		2,340,056				1,151		0.20				2,273,639				1,996		0.36
Borrowings		33,599				4		0.05				465,111				1,632		1.42
Total interest-bearing liabilities		2,373,655				1,155		0.20	%			2,738,750				3,628		0.54	%
Noninterest-bearing deposits		714,753										553,045
Other liabilities		39,374										56,655
Total liabilities		3,127,782										3,348,450
Stockholders' equity		399,360										404,813
Total liabilities and stockholders' equity	$	3,527,142									$	3,753,263
Net earning assets	$	895,361									$	755,655
Average interest-earning assets to
average interest-bearing liabilities		137.72	%									127.59	%
Tax-equivalent:
Net interest income					$	27,360									$	26,019
Interest rate spread								3.34	%									2.90	%
Net interest margin(4)								3.39	%									3.02	%
Non-tax-equivalent:
Net interest income					$	27,040									$	25,693
Interest rate spread								3.30	%									2.87	%
Net interest margin(4)								3.35	%									2.98	%

_________________________________

(1)    The average loans receivable balances include loans held for sale and nonaccruing loans.
(2)    Interest income used in the average interest earned and yield calculation includes the tax equivalent adjustment of $320 and $326 for the three months ended March 31, 2022 and 2021, respectively, calculated based on a combined federal and state tax rate of 24%.
(3)    The average other interest-earning assets consist of FRB stock, FHLB stock, and SBIC investments.
(4)    Net interest income divided by average interest-earning assets.

	Nine Months Ended
(Dollars in thousands)	March 31, 2022										March 31, 2021
	Average Balance Outstanding				Interest Earned/ Paid(2)			Yield/ Rate(2)			Average Balance Outstanding				Interest Earned/ Paid(2)			Yield/ Rate(2)
Assets:
Interest-earning assets:
Loans receivable(1)(2)	$	2,810,205			$	82,377		3.90	%		$	2,826,886			$	85,505		4.03	%
Commercial paper and deposits in other banks		311,457				1,362		0.58				454,609				2,106		0.62
Debt securities available for sale		124,053				1,319		1.42				131,332				1,528		1.55
Other interest-earning assets(3)		22,218				1,867		11.19				39,140				1,729		5.88
Total interest-earning assets		3,267,933				86,925		3.54	%			3,451,967				90,868		3.51	%
Other assets		259,570										256,026
Total assets	$	3,527,503									$	3,707,993
Liabilities and equity:
Interest-bearing liabilities:
Interest-bearing checking accounts		640,194				1,038		0.22	%			593,815				1,142		0.26	%
Money market accounts		1,002,542				1,056		0.14				860,170				1,337		0.21
Savings accounts		224,664				120		0.07				206,478				114		0.07
Certificate accounts		447,623				1,814		0.54				594,565				5,003		1.12
Total interest-bearing deposits		2,315,023				4,028		0.23				2,255,028				7,596		0.45
Borrowings		48,894				45		0.12				471,716				5,007		1.41
Total interest-bearing liabilities		2,363,917				4,073		0.23	%			2,726,744				12,603		0.62	%
Noninterest-bearing deposits		719,872										522,406
Other liabilities		45,443										56,141
Total liabilities		3,129,232										3,305,291
Stockholders' equity		398,271										402,702
Total liabilities and stockholders' equity	$	3,527,503									$	3,707,993
Net earning assets	$	904,016									$	725,223
Average interest-earning assets to
average interest-bearing liabilities		138.24	%									126.60	%
Tax-equivalent:
Net interest income					$	82,852									$	78,265
Interest rate spread								3.31	%									2.89	%
Net interest margin(4)								3.38	%									3.02	%
Non-tax-equivalent:
Net interest income					$	81,915									$	77,323
Interest rate spread								3.28	%									2.85	%
Net interest margin(4)								3.34	%									2.98	%

_________________________________

(1)    The average loans receivable balances include loans held for sale and nonaccruing loans.
(2)    Interest income used in the average interest earned and yield calculation includes the tax equivalent adjustment of $937 and $942 for the nine months ended March 31, 2022 and 2021, respectively, calculated based on a combined federal and state tax rate of 24%.
(3)    The average other interest-earning assets consist of FRB stock, FHLB stock, and SBIC investments.
(4)    Net interest income divided by average interest-earning assets.   


Loans

(Dollars in thousands)	March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021(1)				March 31, 2021
Commercial loans:
Commercial real estate	$	1,102,184			$	1,113,330			$	1,132,764			$	1,142,276			$	1,088,178
Construction and development		251,668				226,439				187,900				179,427				162,820
Commercial and industrial		167,342				162,396				153,612				141,341				140,579
Equipment finance		378,629				367,008				341,995				317,920				291,950
Municipal leases		130,260				131,078				142,100				140,421				129,141
PPP loans		2,756				19,044				28,762				46,650				73,090
Total commercial loans		2,032,839				2,019,295				1,987,133				1,968,035				1,885,758
Retail consumer loans
One-to-four family		347,945				356,850				384,901				406,549				430,001
HELOCs - originated		128,445				128,189				129,791				130,225				131,867
HELOCs - purchased		26,911				30,795				33,943				38,976				46,086
Construction and land/lots		72,735				69,253				69,835				66,027				68,118
Indirect auto finance		83,903				84,581				106,184				115,093				119,656
Consumer		6,760				7,109				7,855				8,362				8,667
Total retail consumer loans		666,699				676,777				732,509				765,232				804,395
Total loans, net of deferred loan fees and costs		2,699,538				2,696,072				2,719,642				2,733,267				2,690,153
Allowance for credit losses - loans		(31,034	)			(30,933	)			(34,406	)			(35,468	)			(36,059	)
Loans, net	$	2,668,504			$	2,665,139			$	2,685,236			$	2,697,799			$	2,654,094

Deposits

(Dollars in thousands)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021(1)			March 31, 2021
Core deposits:
Noninterest-bearing accounts	$	704,344		$	677,159		$	711,764		$	636,414		$	528,711
NOW accounts		652,577			644,343			621,675			644,958			727,240
Money market accounts		1,026,595			1,010,901			987,650			975,001			927,519
Savings accounts		232,831			224,474			220,614			226,391			221,537
Total core deposits		2,616,347			2,556,877			2,541,703			2,482,764			2,405,007
Certificates of deposit		442,810			441,814			445,581			472,777			503,471
Total deposits	$	3,059,157		$	2,998,691		$	2,987,284		$	2,955,541		$	2,908,478

Non-GAAP Reconciliations

In addition to results presented in accordance with generally accepted accounting principles utilized in the United States ("GAAP"), this earnings release contains certain non-GAAP financial measures, which include: the efficiency ratio; tangible book value; tangible book value per share; tangible equity to tangible assets ratio; and the ratio of the allowance for credit losses to total loans excluding PPP loans. The Company believes these non-GAAP financial measures and ratios as presented are useful for both investors and management to understand the effects of certain items and provide an alternative view of its performance over time and in comparison to its competitors. These non-GAAP measures have inherent limitations, are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for total stockholders' equity or operating results determined in accordance with GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies. 

Set forth below is a reconciliation to GAAP of the Company's efficiency ratio:

		Three Months Ended												Nine Months Ended
(Dollars in thousands)		March 31, 2022				December 31, 2021				March 31, 2021				March 31, 2022				March 31, 2021
Noninterest expense		$	25,799			$	25,909			$	30,506			$	77,725			$	82,949
Less: prepayment penalties on borrowings			—				—				3,656				—				3,656
Noninterest expense		$	25,799			$	25,909			$	26,850			$	77,725			$	79,293
Net interest income		$	27,040			$	27,168			$	25,693			$	81,915			$	77,324
Plus: noninterest income			8,947				10,180				10,678				29,480				28,661
Plus: tax equivalent adjustment			320				307				326				937				942
Net interest income plus noninterest income – adjusted		$	36,307			$	37,655			$	36,697			$	112,332			$	106,927
Efficiency ratio			71.69	%			69.37	%			83.87	%			69.77	%			78.26	%
Efficiency ratio - adjusted			71.06	%			68.81	%			73.17	%			69.19	%			74.16	%

Set forth below is a reconciliation to GAAP of tangible book value and tangible book value per share:

(Dollars in thousands, except per share data)		March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021(1)			March 31, 2021
Total stockholders' equity		$	395,131		$	401,746		$	396,511		$	396,519		$	406,452
Less: goodwill, core deposit intangibles, net of taxes			25,742			25,780			25,830			25,902			26,002
Tangible book value		$	369,389		$	375,966		$	370,681		$	370,617		$	380,450
Common shares outstanding			15,978,262			16,303,461			16,307,658			16,636,483			16,655,347
Tangible book value per share		$	23.12		$	23.06		$	22.73		$	22.28		$	22.84
Book value per share		$	24.73		$	24.64		$	24.31		$	23.83		$	24.40

Set forth below is a reconciliation to GAAP of tangible equity to tangible assets:

(Dollars in thousands)		March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021(1)				March 31, 2021
Tangible equity(1)		$	369,389			$	375,966			$	370,681			$	370,617			$	380,450
Total assets			3,541,785				3,502,819				3,481,360				3,524,723				3,648,613
Less: goodwill, core deposit intangibles, net of taxes			25,742				25,780				25,830				25,902				26,002
Total tangible assets		$	3,516,043			$	3,477,039			$	3,455,530			$	3,498,821			$	3,622,611
Tangible equity to tangible assets			10.51	%			10.81	%			10.73	%			10.59	%			10.50	%

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(1)    Tangible equity (or tangible book value) is equal to total stockholders' equity less goodwill and core deposit intangibles, net of related deferred tax liabilities.

FAQ

What was HomeTrust Bancshares' net income for Q3 2022?

HomeTrust Bancshares reported a net income of $8.0 million for Q3 2022.

How did diluted EPS change for HomeTrust Bancshares in Q3 2022?

Diluted EPS increased to $0.51 in Q3 2022 from $0.48 in Q3 2021.

What was the dividend declared by HomeTrust Bancshares for June 2022?

The Board declared a quarterly dividend of $0.09 per share, payable on June 2, 2022.

How much did noninterest income decrease for HomeTrust Bancshares in Q3 2022?

Noninterest income decreased by 16.2% to $8.9 million in Q3 2022.

What was the commercial loan growth for HomeTrust Bancshares?

The net commercial loan growth, excluding PPP loans, was 7.5% annualized for the nine months ended March 31, 2022.