Investar Holding Corporation Announces 2024 First Quarter Results
- Investar reported a net income of $4.7 million for the first quarter of 2024, compared to $3.5 million for the previous quarter and $3.8 million for the same quarter last year.
- Core earnings per diluted common share for the first quarter of 2024 were $0.43, an improvement from $0.39 for the fourth quarter of 2023.
- Return on average assets increased to 0.68% for the quarter ended March 31, 2024, compared to 0.50% for the quarter ended December 31, 2023.
- Noninterest expenses decreased to $15.3 million for the first quarter of 2024, compared to $15.4 million for the previous quarter.
- Credit quality remained strong, with nonperforming loans representing just 0.26% of total loans.
- Investar repurchased 10,525 shares of its common stock during the first quarter at an average price of $16.20 per share.
- Total loans decreased by $30.0 million to $2.18 billion at March 31, 2024, compared to $2.21 billion at December 31, 2023.
- Net interest income for the first quarter of 2024 was $17.2 million, a decrease of $1.3 million from the previous quarter.
- Investar recorded a negative provision for credit losses of $1.4 million for the quarter ended March 31, 2024, compared to a provision for credit losses of $0.5 million for the previous quarter.
- Total deposits at March 31, 2024, were $2.21 billion, a decrease of $47.9 million compared to December 31, 2023.
- None.
Insights
Investar Holding Corporation's report of a net income of
The disclosed strategy to enhance the balance sheet's robustness appears to have begun bearing fruit, as evidenced by the acquisition of higher-yielding loans and the refinancing of borrowings under the Federal Reserve's Bank Term Funding Program. However, the decrease in net interest margins, driven by an increased overall cost of funds, is a potential concern that could impact future profitability, especially in a fluctuating interest rate environment.
Share repurchases are a sign of management's confidence in the company's valuation, with 10,525 shares bought back during the quarter. Such activities can be double-edged; while they may signal strength to the market, they also reflect a decision to return capital to shareholders rather than reinvesting it in growth opportunities.
The financial sector, particularly regional banking institutions like Investar, are often significantly impacted by interest rate changes. Investar's focus on originating and renewing
Investar's loan portfolio shift towards more variable-rate loans may be a strategic move to mitigate interest rate risks, aligning with their goal to build a less interest rate-sensitive balance sheet. This shift, coupled with a negative provision for credit losses, suggests effective credit management and a strong credit quality within their portfolio.
Investors should note that while the restructuring of bank owned life insurance and the repurchase of subordinated debt at a discount can be accretive to earnings, these are one-time benefits and may not be indicative of repeatable, operational successes.
Credit quality, as a key indicator of financial health for banks, remains a highlight for Investar, with nonperforming loans constituting only
The negative provision of
The strategy to allow higher risk credit relationships to run off while focusing on high-quality credits is a prudent approach that may be particularly advantageous in a potentially volatile economic climate, reducing future credit risk exposure.
BATON ROUGE, LA / ACCESSWIRE / April 22, 2024 / Investar Holding Corporation ("Investar") (NASDAQ:ISTR), the holding company for Investar Bank, National Association (the "Bank"), today announced financial results for the quarter ended March 31, 2024. Investar reported net income of
On a non-GAAP basis, core earnings per diluted common share for the first quarter of 2024 were
Investar's President and Chief Executive Officer John D'Angelo commented:
"Investar had a solid first quarter, and I am pleased with our results. Despite the potential of a higher-for-longer interest rate environment, we are focused on proactively managing through this uncertainty while remaining strategically positioned to benefit from a decrease in rates. During the first quarter, we continued to execute on our strategy of consistent, quality earnings through the optimization of our balance sheet and prudent expense management, and we are beginning to realize the benefits as evidenced by our results. Primarily through the right-sizing of our balance sheet, we recognized the benefit of a
Our goal is to build a fortress balance sheet that is less interest rate sensitive and responsibly build capital levels through organic earnings growth and a disciplined pace of share repurchases. Each quarter, we continue to focus on the things we can control and make progress towards our goals. We continue to benefit from the origination of higher yielding loans and repricing of our variable-rate assets. During the first quarter we originated and renewed loans,
We continue to closely manage our interest-earning assets and short-term funding costs. We completed a partial restructuring of approximately
Our efforts to focus on underwriting high quality credits and allow higher risk credit relationships to run off are paying off. Credit quality remained very strong as nonperforming loans represented just
As always, we remain focused on shareholder value and returning capital to shareholders. We repurchased 10,525 shares of our common stock during the first quarter at an average price of
First Quarter Highlights
- Return on average assets increased to
0.68% for the quarter ended March 31, 2024 compared to0.50% for the quarter ended December 31, 2023. Core return on average assets improved to0.61% for the quarter ended March 31, 2024 compared to0.54% for the quarter ended December 31, 2023. - Noninterest expense and core noninterest expense decreased
$0.1 million to$15.3 million for the quarter ended March 31, 2024 compared to$15.4 million for the quarter ended December 31, 2023. - Credit quality remained strong as nonperforming loans were
0.26% of total loans at March 31, 2024 and December 31, 2023. - Consistent with our strategy of optimizing the balance sheet, total loans decreased
$30.0 million , or1.4% , to$2.18 billion at March 31, 2024, compared to$2.21 billion at December 31, 2023. - Variable-rate loans as a percentage of total loans improved to
28% at March 31, 2024 compared to27% at December 31, 2023. During the first quarter we originated and renewed loans,80% of which were variable-rate loans, at a9.2% blended interest rate. - Investar recorded a negative provision for credit losses of
$1.4 million for the quarter ended March 31, 2024, compared to a provision for credit losses of$0.5 million for the quarter ended December 31, 2023. - During the first quarter, Investar refinanced all of its borrowings under the Federal Reserve's Bank Term Funding Program ("BTFP"). The weighted average rate was
4.76% at March 31, 2024 compared to4.83% at December 31, 2023. - Investar completed the closure and sale of one branch location in Alabama during the first quarter of 2024 and recorded a
$0.4 million gain on sale or disposition of fixed assets. - Investar repurchased
$1.0 million in principal amount of our5.125% Fixed-to-Floating Rate Subordinated Notes due 2032 (the "2032 Notes") and recognized a gain on early extinguishment of subordinated debt of$0.2 million . - Investar surrendered approximately
$8.4 million of bank owned life insurance ("BOLI") and reinvested the proceeds in higher yielding policies. The restructuring has an expected earn-back period of just over one year. - Investar repurchased 10,525 shares of its common stock through its stock repurchase program at an average price of
$16.20 during the quarter ended March 31, 2024, leaving 503,741 shares authorized for repurchase under the program at March 31, 2024.
Loans
Total loans were
The following table sets forth the composition of the total loan portfolio as of the dates indicated (dollars in thousands).
| Linked Quarter Change | Year/Year Change | Percentage of Total Loans | ||||||||||||||||||||||||||||||||||
| 3/31/2024 | 12/31/2023 | 3/31/2023 | $ | % | $ | % | 3/31/2024 | 3/31/2023 | ||||||||||||||||||||||||||||
Mortgage loans on real estate | ||||||||||||||||||||||||||||||||||||
Construction and development | $ | 173,511 | $ | 190,371 | $ | 210,274 | $ | (16,860 | ) | (8.9 | )% | $ | (36,763 | ) | (17.5 | )% | 8.0 | % | 10.0 | % | ||||||||||||||||
1-4 Family | 414,480 | 413,786 | 401,329 | 694 | 0.2 | 13,151 | 3.3 | 19.0 | 19.0 | |||||||||||||||||||||||||||
Multifamily | 105,124 | 105,946 | 80,980 | (822 | ) | (0.8 | ) | 24,144 | 29.8 | 4.8 | 3.8 | |||||||||||||||||||||||||
Farmland | 7,539 | 7,651 | 10,731 | (112 | ) | (1.5 | ) | (3,192 | ) | (29.7 | ) | 0.4 | 0.5 | |||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||
Owner-occupied | 453,414 | 449,610 | 433,585 | 3,804 | 0.8 | 19,829 | 4.6 | 20.8 | 20.6 | |||||||||||||||||||||||||||
Nonowner-occupied | 495,844 | 488,098 | 533,572 | 7,746 | 1.6 | (37,728 | ) | (7.1 | ) | 22.7 | 25.3 | |||||||||||||||||||||||||
Commercial and industrial | 518,969 | 543,421 | 425,093 | (24,452 | ) | (4.5 | ) | 93,876 | 22.1 | 23.8 | 20.2 | |||||||||||||||||||||||||
Consumer | 11,697 | 11,736 | 13,480 | (39 | ) | (0.3 | ) | (1,783 | ) | (13.2 | ) | 0.5 | 0.6 | |||||||||||||||||||||||
Total loans | $ | 2,180,578 | $ | 2,210,619 | $ | 2,109,044 | $ | (30,041 | ) | (1.4 | )% | $ | 71,534 | 3.4 | % | 100 | % | 100 | % | |||||||||||||||||
At March 31, 2024, the Bank's total business lending portfolio, which consists of loans secured by owner-occupied commercial real estate properties and commercial and industrial loans, was
Nonowner-occupied loans totaled
Construction and development loans totaled
Credit Quality
Nonperforming loans were
The allowance for credit losses was
Investar recorded a negative provision for credit losses of
Deposits
Total deposits at March 31, 2024 were
The following table sets forth the composition of deposits as of the dates indicated (dollars in thousands).
| Linked Quarter Change | Year/Year Change | Percentage of Total Deposits | ||||||||||||||||||||||||||||||||||
| 3/31/2024 | 12/31/2023 | 3/31/2023 | $ | % | $ | % | 3/31/2024 | 3/31/2023 | ||||||||||||||||||||||||||||
Noninterest-bearing demand deposits | $ | 435,397 | $ | 448,752 | $ | 508,241 | $ | (13,355 | ) | (3.0 | )% | $ | (72,844 | ) | (14.3) | % | 19.7 | % | 23.7 | % | ||||||||||||||||
Interest-bearing demand deposits | 502,818 | 489,604 | 538,515 | 13,214 | 2.7 | (35,697 | ) | (6.6 | ) | 22.8 | 25.1 | |||||||||||||||||||||||||
Money market deposits | 171,113 | 179,366 | 180,402 | (8,253 | ) | (4.6 | ) | (9,289 | ) | (5.1 | ) | 7.7 | 8.4 | |||||||||||||||||||||||
Savings deposits | 132,449 | 137,606 | 137,336 | (5,157 | ) | (3.7 | ) | (4,887 | ) | (3.6 | ) | 6.0 | 6.4 | |||||||||||||||||||||||
Brokered time deposits | 237,850 | 269,102 | 146,270 | (31,252 | ) | (11.6 | ) | 91,580 | 62.6 | 10.8 | 6.8 | |||||||||||||||||||||||||
Time deposits | 728,201 | 731,297 | 634,883 | (3,096 | ) | (0.4 | ) | 93,318 | 14.7 | 33.0 | 29.6 | |||||||||||||||||||||||||
Total deposits | $ | 2,207,828 | $ | 2,255,727 | $ | 2,145,647 | $ | (47,899 | ) | (2.1 | )% | $ | 62,181 | 2.9 | % | 100 | % | 100 | % | |||||||||||||||||
The increase in interest-bearing demand deposits at March 31, 2024 compared to December 31, 2023 is primarily due to organic growth. The decrease in noninterest-bearing demand deposits, money market deposits, and savings deposits at March 31, 2024 compared to December 31, 2023 is primarily the result of customers drawing down on their existing deposit accounts. The decrease in time deposits at March 31, 2024 compared to December 31, 2023 is primarily due to a reduced emphasis on attracting time deposits. Brokered time deposits decreased to
Time deposits and brokered time deposits increased, and other deposit categories decreased at March 31, 2024 compared to March 31, 2023 primarily due to shifts into interest-bearing deposit products as a result of rising interest rates. The majority of the increase in time deposits at March 31, 2024 compared to March 31, 2023 is due to organic growth and existing customer funds migrating from other deposit categories. We utilized shorter term brokered time deposits, which were laddered to provide flexibility, to fund a portion of the purchase of commercial and industrial revolving lines of credit in the second half of 2023.
Stockholders' Equity
Stockholders' equity was
Net Interest Income
Net interest income for the first quarter of 2024 totaled
Investar's net interest margin was
The yield on interest-earning assets was
Exclusive of the interest income accretion from the acquisition of loans and interest recoveries, adjusted net interest margin was
The cost of deposits increased 14 basis points to
The cost of short-term borrowings decreased 18 basis points to
The overall cost of funds for the quarter ended March 31, 2024 increased 11 basis points to
Noninterest Income
Noninterest income for the first quarter of 2024 totaled
The increase in noninterest income compared to the quarter ended December 31, 2023 is driven by a
The increase in noninterest income compared to the quarter ended March 31, 2023 is primarily attributable to a
Noninterest Expense
Noninterest expense for the first quarter of 2024 totaled
The decrease in noninterest expense for the quarter ended March 31, 2024 compared to the quarter ended December 31, 2023 was primarily driven by a
The decrease in noninterest expense for the quarter ended March 31, 2024 compared to the quarter ended March 31, 2023 was primarily driven by
Taxes
Investar recorded an income tax expense of
Basic and Diluted Earnings Per Common Share
Investar reported basic and diluted earnings per common share of
About Investar Holding Corporation
Investar, headquartered in Baton Rouge, Louisiana, provides full banking services, excluding trust services, through its wholly-owned banking subsidiary, Investar Bank, National Association. The Bank currently operates 28 branch locations serving Louisiana, Texas, and Alabama. At March 31, 2024, the Bank had 323 full-time equivalent employees and total assets of
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles in the United States of America, or GAAP. These measures and ratios include "tangible common equity," "tangible assets," "tangible equity to tangible assets," "tangible book value per common share," "core noninterest income," "core earnings before noninterest expense," "core noninterest expense," "core earnings before income tax expense," "core income tax expense," "core earnings," "core efficiency ratio," "core return on average assets," "core return on average equity," "core basic earnings per share," and "core diluted earnings per share." We also present certain average loan, yield, net interest income and net interest margin data adjusted to show the effects of excluding interest recoveries and interest income accretion from the acquisition of loans. Management believes these non-GAAP financial measures provide information useful to investors in understanding Investar's financial results, and Investar believes that its presentation, together with the accompanying reconciliations, provide a more complete understanding of factors and trends affecting Investar's business and allow investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results, and Investar strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. A reconciliation of the non-GAAP financial measures disclosed in this press release to the comparable GAAP financial measures is included at the end of the financial statement tables.
Forward-Looking and Cautionary Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect Investar's current views with respect to, among other things, future events and financial performance. Investar generally identifies forward-looking statements by terminology such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "could," "should," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates," or the negative version of those words or other comparable words.
Any forward-looking statements contained in this press release are based on the historical performance of Investar and its subsidiaries or on Investar's current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by Investar that the future plans, estimates or expectations by Investar will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to Investar's operations, financial results, financial condition, business prospects, growth strategy and liquidity. If one or more of these or other risks or uncertainties materialize, or if Investar's underlying assumptions prove to be incorrect, Investar's actual results may vary materially from those indicated in these statements. Investar does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements. These factors include, but are not limited to, the following, any one or more of which could materially affect the outcome of future events:
- the significant risks and uncertainties for our business, results of operations and financial condition, as well as our regulatory capital and liquidity ratios and other regulatory requirements caused by business and economic conditions generally and in the financial services industry in particular, whether nationally, regionally or in the markets in which we operate;
- changes in inflation, interest rates, yield curves and interest rate spread relationships that affect our loan and deposit pricing;
- our ability to continue to successfully execute the pivot of our near-term strategy from primarily a growth strategy to a strategy primarily focused on consistent, quality earnings through the optimization of our balance sheet, and our ability to successfully execute a long-term growth strategy;
- our ability to achieve organic loan and deposit growth, and the composition of that growth;
- a reduction in liquidity, including as a result of a reduction in the amount of deposits we hold or other sources of liquidity, which may be caused by, among other things, disruptions in the banking industry similar to those that occurred in early 2023 that caused bank depositors to move uninsured deposits to other banks or alternative investments outside the banking industry;
- our ability to identify and enter into agreements to combine with attractive acquisition candidates, finance acquisitions, complete acquisitions after definitive agreements are entered into, and successfully integrate and grow acquired operations;
- our adoption on January 1, 2023 of ASU 2016-13, and inaccuracy of the assumptions and estimates we make in establishing reserves for credit losses and other estimates;
- changes in the quality or composition of our loan or investment portfolios, including adverse developments in borrower industries or in the repayment ability of individual borrowers;
- changes in the quality and composition of, and changes in unrealized losses in, our investment portfolio, including whether we may have to sell securities before their recovery of amortized cost basis and realize losses;
- the extent of continuing client demand for the high level of personalized service that is a key element of our banking approach as well as our ability to execute our strategy generally;
- our dependence on our management team, and our ability to attract and retain qualified personnel;
- the concentration of our business within our geographic areas of operation in Louisiana, Texas and Alabama;
- increasing costs of complying with new and potential future regulations;
- new or increasing geopolitical tensions, including resulting from wars in Ukraine and Israel and surrounding areas;
- the emergence or worsening of widespread public health challenges or pandemics including COVID-19;
- concentration of credit exposure;
- any deterioration in asset quality and higher loan charge-offs, and the time and effort necessary to resolve problem assets;
- fluctuations in the price of oil and natural gas;
- data processing system failures and errors;
- risks associated with our digital transformation process, including increased risks of cyberattacks and other security breaches and challenges associated with addressing the increased prevalence of artificial intelligence;
- risks of losses resulting from increased fraud attacks against us and others in the financial services industry;
- potential impairment of our goodwill and other intangible assets;
- our potential growth, including our entrance or expansion into new markets, and the need for sufficient capital to support that growth;
- the impact of litigation and other legal proceedings to which we become subject;
- competitive pressures in the commercial finance, retail banking, mortgage lending and consumer finance industries, as well as the financial resources of, and products offered by, competitors;
- the impact of changes in laws and regulations applicable to us, including banking, securities and tax laws and regulations and accounting standards, as well as changes in the interpretation of such laws and regulations by our regulators;
- changes in the scope and costs of FDIC insurance and other coverages;
- governmental monetary and fiscal policies; and
- hurricanes, tropical storms, tropical depressions, floods, winter storms, droughts and other adverse weather events, all of which have affected Investar's market areas from time to time; other natural disasters; oil spills and other man-made disasters; acts of terrorism; other international or domestic calamities; acts of God; and other matters beyond our control.
These factors should not be construed as exhaustive. Additional information on these and other risk factors can be found in Part I Item 1A. "Risk Factors" and in the "Special Note Regarding Forward-Looking Statements" in Part II Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Investar's Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission.
For further information contact:
Investar Holding Corporation
John Campbell
Executive Vice President and Chief Financial Officer
(225) 227-2215
John.Campbell@investarbank.com
INVESTAR HOLDING CORPORATION |
| As of and for the three months ended | ||||||||||||||||||||
| 3/31/2024 | 12/31/2023 | 3/31/2023 | Linked Quarter | Year/Year | ||||||||||||||||
EARNINGS DATA | ||||||||||||||||||||
Total interest income | $ | 35,722 | $ | 36,668 | $ | 30,977 | (2.6)% | |||||||||||||
Total interest expense | 18,506 | 18,177 | 10,804 | 1.8 | 71.3 | |||||||||||||||
Net interest income | 17,216 | 18,491 | 20,173 | (6.9) | (14.7) | |||||||||||||||
Provision for credit losses | (1,419) | 486 | 388 | (392.0) | (465.7) | |||||||||||||||
Total noninterest income | 2,748 | 1,755 | 1,076 | 56.6 | 155.4 | |||||||||||||||
Total noninterest expense | 15,296 | 15,440 | 16,175 | (0.9) | (5.4) | |||||||||||||||
Income before income tax expense | 6,087 | 4,320 | 4,686 | 40.9 | 29.9 | |||||||||||||||
Income tax expense | 1,380 | 782 | 874 | 76.5 | 57.9 | |||||||||||||||
Net income | $ | 4,707 | $ | 3,538 | $ | 3,812 | 33.0 | 23.5 | ||||||||||||
AVERAGE BALANCE SHEET DATA | ||||||||||||||||||||
Total assets | $ | 2,802,192 | $ | 2,817,388 | $ | 2,735,823 | (0.5)% | |||||||||||||
Total interest-earning assets | 2,669,553 | 2,694,474 | 2,615,097 | (0.9) | 2.1 | |||||||||||||||
Total loans | 2,195,496 | 2,214,916 | 2,103,989 | (0.9) | 4.3 | |||||||||||||||
Total interest-bearing deposits | 1,805,569 | 1,824,318 | 1,557,665 | (1.0) | 15.9 | |||||||||||||||
Total interest-bearing liabilities | 2,118,746 | 2,119,724 | 1,961,302 | (0.0) | 8.0 | |||||||||||||||
Total deposits | 2,233,704 | 2,279,211 | 2,108,168 | (2.0) | 6.0 | |||||||||||||||
Total stockholders' equity | 228,690 | 212,454 | 219,690 | 7.6 | 4.1 | |||||||||||||||
PER SHARE DATA | ||||||||||||||||||||
Earnings: | ||||||||||||||||||||
Basic earnings per common share | $ | 0.48 | $ | 0.36 | $ | 0.38 | ||||||||||||||
Diluted earnings per common share | 0.48 | 0.36 | 0.38 | 33.3 | 26.3 | |||||||||||||||
Core Earnings(1): | ||||||||||||||||||||
Core basic earnings per common share(1) | 0.44 | 0.39 | 0.52 | 12.8 | (15.4) | |||||||||||||||
Core diluted earnings per common share(1) | 0.43 | 0.39 | 0.51 | 10.3 | (15.7) | |||||||||||||||
Book value per common share | 23.21 | 23.26 | 22.06 | (0.2) | 5.2 | |||||||||||||||
Tangible book value per common share(1) | 18.90 | 18.92 | 17.74 | (0.1) | 6.5 | |||||||||||||||
Common shares outstanding | 9,781,946 | 9,748,067 | 9,900,648 | 0.3 | (1.2) | |||||||||||||||
Weighted average common shares outstanding - basic | 9,769,626 | 9,754,617 | 9,908,931 | 0.2 | (1.4) | |||||||||||||||
Weighted average common shares outstanding - diluted | 9,866,973 | 9,763,296 | 9,992,467 | 1.1 | (1.3) | |||||||||||||||
PERFORMANCE RATIOS | ||||||||||||||||||||
Return on average assets | ||||||||||||||||||||
Core return on average assets(1) | 0.61 | 0.54 | 0.76 | 13.0 | (19.7) | |||||||||||||||
Return on average equity | 8.28 | 6.61 | 7.04 | 25.3 | 17.6 | |||||||||||||||
Core return on average equity(1) | 7.52 | 7.16 | 9.46 | 5.0 | (20.5) | |||||||||||||||
Net interest margin | 2.59 | 2.72 | 3.13 | (4.8) | (17.3) | |||||||||||||||
Net interest income to average assets | 2.47 | 2.60 | 2.99 | (5.0) | (17.4 | |||||||||||||||
Noninterest expense to average assets | 2.20 | 2.17 | 2.40 | 1.4 | (8.3) | |||||||||||||||
Efficiency ratio(2) | 76.62 | 76.26 | 76.12 | 0.5 | 0.7 | |||||||||||||||
Core efficiency ratio(1) | 78.81 | 74.85 | 69.89 | 5.3 | 12.8 | |||||||||||||||
Dividend payout ratio | 20.83 | 27.78 | 25.00 | (25.0) | (16.7) | |||||||||||||||
Net charge-offs to average loans | - | - | 0.01 | - | (100.0) | |||||||||||||||
| (1) Non-GAAP financial measure. See reconciliation. |
| (2) Efficiency ratio represents noninterest expense divided by the sum of net interest income (before provision for credit losses) and noninterest income. |
INVESTAR HOLDING CORPORATION |
| As of and for the three months ended | ||||||||||||||||||||
| 3/31/2024 | 12/31/2023 | 3/31/2023 | Linked Quarter | Year/Year | ||||||||||||||||
ASSET QUALITY RATIOS | ||||||||||||||||||||
Nonperforming assets to total assets | -% | |||||||||||||||||||
Nonperforming loans to total loans | 0.26 | 0.26 | 0.27 | - | (3.7) | |||||||||||||||
Allowance for credit losses to total loans | 1.34 | 1.38 | 1.45 | (2.9) | (7.6) | |||||||||||||||
Allowance for credit losses to nonperforming loans | 515.36 | 529.32 | 535.55 | (2.6) | (3.8) | |||||||||||||||
CAPITAL RATIOS | ||||||||||||||||||||
Investar Holding Corporation: | ||||||||||||||||||||
Total equity to total assets | ||||||||||||||||||||
Tangible equity to tangible assets(1) | 6.73 | 6.65 | 6.48 | 1.2 | 3.9 | |||||||||||||||
Tier 1 leverage capital | 8.60 | 8.35 | 8.30 | 3.0 | 3.6 | |||||||||||||||
Common equity tier 1 capital(2) | 9.76 | 9.51 | 9.64 | 2.6 | 1.2 | |||||||||||||||
Tier 1 capital(2) | 10.16 | 9.90 | 10.06 | 2.6 | 1.0 | |||||||||||||||
Total capital(2) | 13.18 | 12.99 | 13.24 | 1.5 | (0.5) | |||||||||||||||
Investar Bank: | ||||||||||||||||||||
Tier 1 leverage capital | 10.01 | 9.81 | 9.72 | 2.0 | 3.0 | |||||||||||||||
Common equity tier 1 capital(2) | 11.83 | 11.64 | 11.78 | 1.6 | 0.4 | |||||||||||||||
Tier 1 capital(2) | 11.83 | 11.64 | 11.78 | 1.6 | 0.4 | |||||||||||||||
Total capital(2) | 13.04 | 12.89 | 13.03 | 1.2 | 0.1 | |||||||||||||||
(1) Non-GAAP financial measure. See reconciliation. |
(2) Estimated for March 31, 2024. |
INVESTAR HOLDING CORPORATION |
| March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||||||
ASSETS | ||||||||||||
Cash and due from banks | $ | 18,083 | $ | 28,285 | $ | 30,571 | ||||||
Interest-bearing balances due from other banks | 23,762 | 3,724 | 722 | |||||||||
Cash and cash equivalents | 41,845 | 32,009 | 31,293 | |||||||||
Available for sale securities at fair value (amortized cost of | 353,340 | 361,918 | 406,107 | |||||||||
Held to maturity securities at amortized cost (estimated fair value of | 17,755 | 20,472 | 8,048 | |||||||||
Loans | 2,180,578 | 2,210,619 | 2,109,044 | |||||||||
Less: allowance for credit losses | (29,114 | ) | (30,540 | ) | (30,521 | ) | ||||||
Loans, net | 2,151,464 | 2,180,079 | 2,078,523 | |||||||||
Equity securities at fair value | 2,260 | 1,180 | 1,241 | |||||||||
Nonmarketable equity securities | 12,723 | 13,417 | 23,376 | |||||||||
Bank premises and equipment, net of accumulated depreciation of | 42,659 | 44,183 | 47,698 | |||||||||
Other real estate owned, net | 4,247 | 4,438 | 662 | |||||||||
Accrued interest receivable | 15,047 | 14,366 | 12,947 | |||||||||
Deferred tax asset | 17,779 | 16,910 | 16,434 | |||||||||
Goodwill and other intangible assets, net | 42,154 | 42,320 | 42,864 | |||||||||
Bank owned life insurance | 60,745 | 58,797 | 57,715 | |||||||||
Other assets | 25,688 | 25,066 | 24,761 | |||||||||
Total assets | $ | 2,787,706 | $ | 2,815,155 | $ | 2,751,669 | ||||||
LIABILITIES | ||||||||||||
Deposits | ||||||||||||
Noninterest-bearing | $ | 435,397 | $ | 448,752 | $ | 508,241 | ||||||
Interest-bearing | 1,772,431 | 1,806,975 | 1,637,406 | |||||||||
Total deposits | 2,207,828 | 2,255,727 | 2,145,647 | |||||||||
Advances from Federal Home Loan Bank | 23,500 | 23,500 | 300,116 | |||||||||
Borrowings under Bank Term Funding Program | 229,000 | 212,500 | - | |||||||||
Federal funds purchased | - | - | 440 | |||||||||
Repurchase agreements | 7,850 | 8,633 | - | |||||||||
Subordinated debt, net of unamortized issuance costs | 43,363 | 44,320 | 44,248 | |||||||||
Junior subordinated debt | 8,657 | 8,630 | 8,545 | |||||||||
Accrued taxes and other liabilities | 40,503 | 35,077 | 34,215 | |||||||||
Total liabilities | 2,560,701 | 2,588,387 | 2,533,211 | |||||||||
STOCKHOLDERS' EQUITY | ||||||||||||
Preferred stock, no par value per share; 5,000,000 shares authorized | - | - | - | |||||||||
Common stock, | 9,782 | 9,748 | 9,901 | |||||||||
Surplus | 145,739 | 145,456 | 146,027 | |||||||||
Retained earnings | 120,441 | 116,711 | 106,780 | |||||||||
Accumulated other comprehensive loss | (48,957 | ) | (45,147 | ) | (44,250 | ) | ||||||
Total stockholders' equity | 227,005 | 226,768 | 218,458 | |||||||||
Total liabilities and stockholders' equity | $ | 2,787,706 | $ | 2,815,155 | $ | 2,751,669 | ||||||
INVESTAR HOLDING CORPORATION |
| For the three months ended | ||||||||||||
| March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||||||
INTEREST INCOME | ||||||||||||
Interest and fees on loans | $ | 32,135 | $ | 33,128 | $ | 27,359 | ||||||
Interest on investment securities | ||||||||||||
Taxable | 2,817 | 2,970 | 3,085 | |||||||||
Tax-exempt | 238 | 253 | 105 | |||||||||
Other interest income | 532 | 317 | 428 | |||||||||
Total interest income | 35,722 | 36,668 | 30,977 | |||||||||
INTEREST EXPENSE | ||||||||||||
Interest on deposits | 14,845 | 14,584 | 6,221 | |||||||||
Interest on borrowings | 3,661 | 3,593 | 4,583 | |||||||||
Total interest expense | 18,506 | 18,177 | 10,804 | |||||||||
Net interest income | 17,216 | 18,491 | 20,173 | |||||||||
Provision for credit losses | (1,419) | 486 | 388 | |||||||||
Net interest income after provision for credit losses | 18,635 | 18,005 | 19,785 | |||||||||
NONINTEREST INCOME | ||||||||||||
Service charges on deposit accounts | 810 | 798 | 740 | |||||||||
Loss on call or sale of investment securities, net | - | (322) | (1) | |||||||||
Gain (loss) on sale or disposition of fixed assets, net | 427 | (39) | (859) | |||||||||
Loss on sale of other real estate owned, net | - | - | (142) | |||||||||
Gain on sale of loans | - | - | 75 | |||||||||
Servicing fees and fee income on serviced loans | - | 2 | 6 | |||||||||
Interchange fees | 395 | 417 | 438 | |||||||||
Income from bank owned life insurance | 388 | 371 | 336 | |||||||||
Change in the fair value of equity securities | 80 | 24 | (4) | |||||||||
Other operating income | 648 | 504 | 487 | |||||||||
Total noninterest income | 2,748 | 1,755 | 1,076 | |||||||||
Income before noninterest expense | 21,383 | 19,760 | 20,861 | |||||||||
NONINTEREST EXPENSE | ||||||||||||
Depreciation and amortization | 812 | 909 | 1,052 | |||||||||
Salaries and employee benefits | 9,248 | 9,003 | 9,334 | |||||||||
Occupancy | 581 | 706 | 1,024 | |||||||||
Data processing | 937 | 892 | 875 | |||||||||
Marketing | 41 | 68 | 69 | |||||||||
Professional fees | 419 | 461 | 633 | |||||||||
Gain on early extinguishment of subordinated debt | (215) | - | - | |||||||||
Other operating expenses | 3,473 | 3,401 | 3,188 | |||||||||
Total noninterest expense | 15,296 | 15,440 | 16,175 | |||||||||
Income before income tax expense | 6,087 | 4,320 | 4,686 | |||||||||
Income tax expense | 1,380 | 782 | 874 | |||||||||
Net income | $ | 4,707 | $ | 3,538 | $ | 3,812 | ||||||
EARNINGS PER SHARE | ||||||||||||
Basic earnings per common share | $ | 0.48 | $ | 0.36 | $ | 0.38 | ||||||
Diluted earnings per common share | 0.48 | 0.36 | 0.38 | |||||||||
Cash dividends declared per common share | 0.10 | 0.10 | 0.095 | |||||||||
INVESTAR HOLDING CORPORATION |
| For the three months ended | ||||||||||||||||||||||||||||
| March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||||||||||||||||||||||
| Interest | Interest | Interest | ||||||||||||||||||||||||||
| Average | Income/ | Average | Income/ | Average | Income/ | |||||||||||||||||||||||
| Balance | Expense | Yield/ Rate | Balance | Expense | Yield/ Rate | Balance | Expense | Yield/ Rate | ||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||||||||||
| Loans | $ | 2,195,496 | $ | 32,135 | $ | 2,214,916 | $ | 33,128 | $ | 2,103,989 | $ | 27,359 | ||||||||||||||||
| Securities: | ||||||||||||||||||||||||||||
Taxable | 410,761 | 2,817 | 2.76 | 427,746 | 2,970 | 2.75 | 459,099 | 3,085 | 2.73 | |||||||||||||||||||
Tax-exempt | 26,963 | 238 | 3.55 | 28,807 | 253 | 3.50 | 16,496 | 105 | 2.58 | |||||||||||||||||||
| Interest-bearing balances with banks | 36,333 | 532 | 5.89 | 23,005 | 317 | 5.46 | 35,513 | 428 | 4.89 | |||||||||||||||||||
Total interest-earning assets | 2,669,553 | 35,722 | 5.38 | 2,694,474 | 36,668 | 5.40 | 2,615,097 | 30,977 | 4.80 | |||||||||||||||||||
| Cash and due from banks | 26,246 | 27,214 | 31,356 | |||||||||||||||||||||||||
| Intangible assets | 42,243 | 42,414 | 43,000 | |||||||||||||||||||||||||
| Other assets | 94,311 | 83,447 | 76,695 | |||||||||||||||||||||||||
| Allowance for credit losses | (30,161) | (30,161) | (30,325) | |||||||||||||||||||||||||
Total assets | $ | 2,802,192 | $ | 2,817,388 | $ | 2,735,823 | ||||||||||||||||||||||
| Liabilities and stockholders' equity | ||||||||||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 680,548 | $ | 3,166 | $ | 668,277 | $ | 2,873 | $ | 736,083 | $ | 1,594 | ||||||||||||||||
Savings deposits | 134,853 | 339 | 1.01 | 136,045 | 318 | 0.93 | 146,093 | 16 | 0.04 | |||||||||||||||||||
Brokered time deposits | 255,694 | 3,314 | 5.21 | 275,552 | 3,590 | 5.17 | 67,088 | 773 | 4.68 | |||||||||||||||||||
Time deposits | 734,474 | 8,026 | 4.39 | 744,444 | 7,803 | 4.16 | 608,401 | 3,838 | 2.56 | |||||||||||||||||||
Total interest-bearing deposits | 1,805,569 | 14,845 | 3.31 | 1,824,318 | 14,584 | 3.17 | 1,557,665 | 6,221 | 1.62 | |||||||||||||||||||
| Short-term borrowings | 236,826 | 2,745 | 4.66 | 218,977 | 2,672 | 4.84 | 301,033 | 3,562 | 4.80 | |||||||||||||||||||
| Long-term debt | 76,351 | 916 | 4.83 | 76,429 | 921 | 4.78 | 102,604 | 1,021 | 4.04 | |||||||||||||||||||
Total interest-bearing liabilities | 2,118,746 | 18,506 | 3.51 | 2,119,724 | 18,177 | 3.40 | 1,961,302 | 10,804 | 2.23 | |||||||||||||||||||
| Noninterest-bearing deposits | 428,135 | 454,893 | 550,503 | |||||||||||||||||||||||||
| Other liabilities | 26,621 | 30,317 | 4,328 | |||||||||||||||||||||||||
| Stockholders' equity | 228,690 | 212,454 | 219,690 | |||||||||||||||||||||||||
Total liability and stockholders' equity | $ | 2,802,192 | $ | 2,817,388 | $ | 2,735,823 | ||||||||||||||||||||||
Net interest income/net interest margin | $ | 17,216 | $ | 18,491 | $ | 20,173 | ||||||||||||||||||||||
INVESTAR HOLDING CORPORATION |
| For the three months ended | ||||||||||||||||||||||||||||
| March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||||||||||||||||||||||
| Interest | Interest | Interest | ||||||||||||||||||||||||||
| Average | Income/ | Average | Income/ | Average | Income/ | |||||||||||||||||||||||
| Balance | Expense | Yield/Rate | Balance | Expense | Yield/Rate | Balance | Expense | Yield/Rate | ||||||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||||||||||
| Loans | $ | 2,195,496 | $ | 32,135 | $ | 2,214,916 | $ | 33,128 | $ | 2,103,989 | $ | 27,359 | ||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||||
Interest recoveries | 21 | 1,105 | 141 | |||||||||||||||||||||||||
Accretion | 19 | 25 | 55 | |||||||||||||||||||||||||
| Adjusted loans | 2,195,496 | 32,095 | 5.88 | 2,214,916 | 31,998 | 5.73 | 2,103,989 | 27,163 | 5.24 | |||||||||||||||||||
| Securities: | ||||||||||||||||||||||||||||
Taxable | 410,761 | 2,817 | 2.76 | 427,746 | 2,970 | 2.75 | 459,099 | 3,085 | 2.73 | |||||||||||||||||||
Tax-exempt | 26,963 | 238 | 3.55 | 28,807 | 253 | 3.50 | 16,496 | 105 | 2.58 | |||||||||||||||||||
| Interest-bearing balances with banks | 36,333 | 532 | 5.89 | 23,005 | 317 | 5.46 | 35,513 | 428 | 4.89 | |||||||||||||||||||
| Adjusted interest-earning assets | 2,669,553 | 35,682 | 5.38 | 2,694,474 | 35,538 | 5.23 | 2,615,097 | 30,781 | 4.77 | |||||||||||||||||||
| Total interest-bearing liabilities | 2,118,746 | 18,506 | 3.51 | 2,119,724 | 18,177 | 3.40 | 1,961,302 | 10,804 | 2.23 | |||||||||||||||||||
Adjusted net interest income/adjusted net interest margin | $ | 17,176 | $ | 17,361 | $ | 19,977 | ||||||||||||||||||||||
INVESTAR HOLDING CORPORATION |
| March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||||||
| Tangible common equity | ||||||||||||
| Total stockholders' equity | $ | 227,005 | $ | 226,768 | $ | 218,458 | ||||||
| Adjustments: | ||||||||||||
| Goodwill | 40,088 | 40,088 | 40,088 | |||||||||
| Core deposit intangible | 1,966 | 2,132 | 2,676 | |||||||||
| Trademark intangible | 100 | 100 | 100 | |||||||||
| Tangible common equity | $ | 184,851 | $ | 184,448 | $ | 175,594 | ||||||
| Tangible assets | ||||||||||||
| Total assets | $ | 2,787,706 | $ | 2,815,155 | $ | 2,751,669 | ||||||
| Adjustments: | ||||||||||||
| Goodwill | 40,088 | 40,088 | 40,088 | |||||||||
| Core deposit intangible | 1,966 | 2,132 | 2,676 | |||||||||
| Trademark intangible | 100 | 100 | 100 | |||||||||
| Tangible assets | $ | 2,745,552 | $ | 2,772,835 | $ | 2,708,805 | ||||||
| Common shares outstanding | 9,781,946 | 9,748,067 | 9,900,648 | |||||||||
| Tangible equity to tangible assets | ||||||||||||
| Book value per common share | $ | 23.21 | $ | 23.26 | $ | 22.06 | ||||||
| Tangible book value per common share | 18.90 | 18.92 | 17.74 | |||||||||
INVESTAR HOLDING CORPORATION |
| Three months ended | |||||||||||||
| 3/31/2024 | 12/31/2023 | 3/31/2023 | |||||||||||
Net interest income | (a) | $ | 17,216 | $ | 18,491 | $ | 20,173 | ||||||
Provision for credit losses | (1,419 | ) | 486 | 388 | |||||||||
Net interest income after provision for credit losses | 18,635 | 18,005 | 19,785 | ||||||||||
Noninterest income | (b) | 2,748 | 1,755 | 1,076 | |||||||||
Loss on call or sale of investment securities, net | - | 322 | 1 | ||||||||||
(Gain) loss on sale or disposition of fixed assets, net | (427 | ) | 39 | 859 | |||||||||
Loss on sale of other real estate owned, net | - | - | 142 | ||||||||||
Gain on sale of loans(1) | - | - | (75 | ) | |||||||||
Change in the fair value of equity securities | (80 | ) | (24 | ) | 4 | ||||||||
Change in the net asset value of other investments(2) | (70 | ) | (43 | ) | 33 | ||||||||
Core noninterest income | (d) | 2,171 | 2,049 | 2,040 | |||||||||
Core earnings before noninterest expense | 20,806 | 20,054 | 21,825 | ||||||||||
Total noninterest expense | (c) | 15,296 | 15,440 | 16,175 | |||||||||
Write down of other real estate owned(3) | (233 | ) | - | - | |||||||||
Gain on early extinguishment of subordinated debt | 215 | - | - | ||||||||||
Loan purchase expense(4) | - | (66 | ) | - | |||||||||
Divestiture expense(5) | - | - | (651 | ) | |||||||||
Core noninterest expense | (f) | 15,278 | 15,374 | 15,524 | |||||||||
Core earnings before income tax expense | 5,528 | 4,680 | 6,301 | ||||||||||
Core income tax expense(6) | 1,255 | 847 | 1,178 | ||||||||||
Core earnings | $ | 4,273 | $ | 3,833 | $ | 5,123 | |||||||
Core basic earnings per common share | 0.44 | 0.39 | 0.52 | ||||||||||
Diluted earnings per common share (GAAP) | $ | 0.48 | $ | 0.36 | $ | 0.38 | |||||||
Loss on call or sale of investment securities, net | - | 0.03 | - | ||||||||||
(Gain) loss on sale or disposition of fixed assets, net | (0.03 | ) | - | 0.07 | |||||||||
Loss on sale of other real estate owned, net | - | - | 0.01 | ||||||||||
Gain on sale of loans(1) | - | - | (0.01 | ) | |||||||||
Change in the fair value of equity securities | (0.01 | ) | - | - | |||||||||
Change in the net asset value of other investments(2) | (0.01 | ) | - | - | |||||||||
Write down of other real estate owned(3) | 0.02 | - | - | ||||||||||
Gain on early extinguishment of subordinated debt | (0.02 | ) | - | - | |||||||||
Loan purchase expense(4) | - | - | - | ||||||||||
Divestiture expense(5) | - | - | 0.06 | ||||||||||
Core diluted earnings per common share | $ | 0.43 | $ | 0.39 | $ | 0.51 | |||||||
Efficiency ratio | (c) / (a+b) | 76.62 | % | 76.26 | % | 76.12 | % | ||||||
Core efficiency ratio | (f) / (a+d) | 78.81 | 74.85 | 69.89 | |||||||||
Core return on average assets(7) | 0.61 | 0.54 | 0.76 | ||||||||||
Core return on average equity(7) | 7.52 | 7.16 | 9.46 | ||||||||||
Total average assets | $ | 2,802,192 | $ | 2,817,388 | $ | 2,735,823 | |||||||
Total average stockholders' equity | 228,690 | 212,454 | 219,690 | ||||||||||
| (1) Adjustment to noninterest income recorded upon completion of the sale of the Alice and Victoria, Texas branches for remaining discount on loans sold. |
(2) Change in net asset value of other investments represents unrealized gains or losses on Investar's investments in Small Business Investment Companies and other investment funds and is included in other operating income in the accompanying consolidated statements of income. |
| (3) Adjustment to noninterest expense for provision for estimated losses on other real estate owned when fair value is determined to be less than carrying values, which is included in other operating expense in the accompanying consolidated statements of income. |
(4) Adjustment to noninterest expense directly attributable to the purchase of loans, consisting of professional fees for legal and consulting services. |
(5) Adjustment to noninterest expenses directly attributable to the sale of the Alice and Victoria, Texas branch locations, consisting of |
(6) Core income tax expense is calculated using the effective tax rates of |
(7) Core earnings used in calculation. No adjustments were made to average assets or average equity. |
SOURCE: Investar Holding Corporation
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FAQ
What was Investar Holding 's net income for the first quarter of 2024?
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