Nicolet Bankshares, Inc. Announces First Quarter 2024 Results

Rhea-AI Summary

Nicolet Bankshares, Inc. reported a net income of $28 million for the first quarter of 2024, with earnings per diluted common share of $1.82. The company's tangible common equity ratio increased to 8.33%, and credit quality remained strong with nonperforming assets stable at 0.33% of total assets. The company's financial performance metrics were robust, with a 17.07% return on average tangible common equity and a tangible book value per share of $44.91. Nicolet is well-positioned for growth and has various options for capital deployment, including organic growth, M&A, and capital return to shareholders through share buybacks and dividends.

Positive

• Nicolet Bankshares, Inc. reported a net income of $28 million for the first quarter of 2024, with earnings per diluted common share of $1.82.
• The company's tangible common equity ratio increased to 8.33% for the first quarter of 2024.
• Credit quality remained strong, with nonperforming assets stable at 0.33% of total assets.
• The company achieved a 17.07% return on average tangible common equity and a tangible book value per share of $44.91.
• Nicolet has multiple options for capital deployment, including organic growth, M&A, and capital return to shareholders through share buybacks and dividends.

Negative

• None.

Insights

Financial Analyst

Examining Nicolet Bankshares, Inc.'s first quarter financial results, investors may note a marginal drop in net income from $31 million in the previous quarter to $28 million. The decline in net interest income by $1 million and decrease in noninterest income, primarily from lower net asset gains, are contributors to this downturn. Yet, it is worth recognizing that the company has managed to maintain an impressive return on average tangible common equity (17.07%) and return on average assets (1.33%), which are key indicators of financial health. Despite a slight reduction in total assets and deposits, the stable asset quality, as indicated by the nonperforming assets ratio, suggests a solid credit culture within the bank. For an investor, the increment in tangible book value per share to $44.91 signifies growth in shareholder value and the maintenance of a strong capital position could potentially afford the company agility in pursuing future growth strategies like mergers and acquisitions or capital returns to shareholders.

Market Research Analyst

From a market perspective, the slight contraction in Nicolet's balance sheet, coupled with modest loan growth, could be indicative of cautious lending in a potentially tightening economic environment. The strategic decision to maintain higher cash reserves post-balance sheet repositioning in 2023 signals a conservative approach, which could be appealing to investors who prioritize stability. Furthermore, the unchanged nonperforming assets ratio implies that the bank has not experienced significant deterioration in credit quality despite economic headwinds. This disciplined risk management could position Nicolet favorably against peers, particularly if the economic climate becomes more challenging. However, the slowing M&A market noted by the CEO may limit near-term growth opportunities, suggesting that the bank's future performance might rely more heavily on organic growth and operational efficiencies.

Tax Analyst

Investors should not overlook the impact of the change in Wisconsin state tax law on Nicolet’s financials. While the tax benefit resulting from the exemption of certain interest and fees from state taxable income is a positive for future earnings, it required a one-time establishment of a $9.1 million valuation allowance for deferred tax assets. This has been a drag on 2023's earnings but is expected to benefit the company going forward by potentially reducing tax expenses. The reduction in net charge-offs to negligible amounts is an encouraging sign and speaks to the effectiveness of the bank’s credit management strategies. This tax landscape alteration and its effects underline the importance of regulatory changes on a company's bottom line and should be factored into the valuation and future earnings projections for investors.

• Well positioned to be opportunistic
  • Net income of $28 million or adjusted net income (non-GAAP) of $26 million for first quarter 2024, compared to net income of $31 million or adjusted net income (non-GAAP) of $28 million in prior quarter, and net loss of $9 million or adjusted net income (non-GAAP) of $22 million for first quarter 2023
  • Tangible common equity ratio increased to 8.33% for first quarter 2024
  • Credit quality remains strong with nonperforming assets stable at 0.33% of total assets and negligible net charge-offs
• Continued strong financial performance metrics for first quarter 2024
  • 17.07% Return on average tangible common equity
  • 1.33% Return on average assets
• Tangible book value per share increased to $44.91 for first quarter 2024

GREEN BAY, Wis.--(BUSINESS WIRE)-- Nicolet Bankshares, Inc. (NYSE: NIC) (“Nicolet”) announced first quarter 2024 net income of $28 million and earnings per diluted common share of $1.82, compared to net income of $31 million and earnings per diluted common share of $2.02 for fourth quarter 2024, and net loss of $9 million and loss per diluted common share of $0.61 for first quarter 2023.

Net income reflected certain non-core items and the related tax effect of each, including the first quarter 2023 balance sheet repositioning and third quarter 2023 change in Wisconsin state tax law, as well as gains / (losses) on other assets and investments in all periods. These non-core items positively impacted earnings per diluted common share $0.10 and $0.17 for first quarter 2024 and fourth quarter 2023, respectively, and negatively impacted earnings per diluted common share $2.06 for first quarter 2023.

“Our first quarter results show our focus on execution as we move throughout the year,” said Mike Daniels, Chairman, President, and CEO of Nicolet. “We continue to maintain our relationship-based pricing discipline paired with our credit culture as our team consistently shows the value that we bring. We are encouraged by the results, and we will continue to challenge ourselves to manage both growth and efficiency.”

Daniels continued, “Our strong core profitability has allowed us to build capital, which puts us in an enviable position of having significant options going forward. These options include organic growth, M&A, capital return to shareholders through share buybacks and dividends. While the M&A market remains slow, we are reviewing opportunities and participating in high-level discussions with potential partners, as we maintain our high degree of discipline with our M&A strategy. Our goal is always to partner with a franchise that makes Nicolet and the communities we serve better.”

Nicolet’s 2023 results were significantly impacted by the first quarter 2023 balance sheet repositioning, which included the sale of $500 million (par value) U.S. Treasury held to maturity securities for a pre-tax loss of $38 million or an after-tax loss of $28 million, with the net proceeds used to reduce FHLB borrowings and the remainder held in investable cash. In addition, in July 2023 a new Wisconsin tax law was signed which provided financial institutions with an exemption from state taxable income for interest, fees, and penalties earned on specific loans to existing Wisconsin-based business or agriculture purpose loans. This tax law change to Nicolet moving forward will be a reduction / elimination of State income taxes being expensed; however, it also required a $9.1 million valuation allowance to be established for the State-related deferred tax asset as of the effective date of the legislation. While both provided a drag to 2023 earnings, each also serve as a tailwind for first quarter 2024 and beyond.

Balance Sheet Review

At March 31, 2024, period end assets were $8.4 billion, down slightly ($22 million) from December 31, 2023, mostly lower cash balances, partly offset by growth in loans. Total loans increased $44 million (1%) from December 31, 2023, with growth in agricultural, commercial and industrial, and residential real estate loans. Total deposits of $7.2 billion at March 31, 2024, decreased $32 million from December 31, 2023, mostly noninterest-bearing demand deposits. Total capital was $1.1 billion at March 31, 2024, an increase of $25 million over December 31, 2023, with earnings partly offset by the quarterly common stock dividend.

Asset Quality

Nonperforming assets were $28 million and represented 0.33% of total assets at March 31, 2024, unchanged from December 31, 2023, and down from $41 million or 0.50% at March 31, 2023. The allowance for credit losses-loans was $64 million and represented 1.01% of total loans at March 31, 2024, compared to $64 million (or 1.00% of total loans) at December 31, 2023, and $62 million (or 1.00% of total loans) at March 31, 2023. Asset quality trends remain solid and loan net charge-offs were negligible.

Income Statement Review - Quarter

Net income was $28 million and adjusted net income (non-GAAP) was $26 million for first quarter 2024, compared to net income of $31 million and adjusted net income (non-GAAP) of $28 million for fourth quarter 2023.

Net interest income was $63 million for first quarter 2024, down $1 million from fourth quarter 2023. Interest income increased $1 million mostly due to the repricing of new and renewed loans in a rising interest rate environment, partly offset by lower investable cash balances, while interest expense increased $2 million due to higher average rates on seasonal deposits. The net interest margin for first quarter 2024 was 3.26%, down 4 bps from 3.30% for fourth quarter 2023. The yield on interest-earning assets increased 12 bps (to 5.44%) mostly due to higher average rates from the repricing of the loan portfolio, while the cost of funds increased 11 bps (to 3.01%) for first quarter 2024, attributable mainly to higher cost seasonal deposits.

Noninterest income of $19 million for first quarter 2024 decreased $5 million from fourth quarter 2023, mostly due to the change in net asset gains. First quarter 2024 included net gains of $2 million due to a $1 million gain on sale of an investment security and a $1 million gain on the early extinguishment of subordinated debt, while fourth quarter 2023 included net gains of $6 million from the $9 million pre-tax gain on the sale of Nicolet’s member interest in UFS, LLC, partly offset by a $3 million loss on the sale of certain securities. Excluding the net asset gains (losses), noninterest income for first quarter 2024 was $18 million, a $1 million decrease from fourth quarter 2023, mostly due to changes in the fair value of nonqualified deferred compensation plan assets.

Noninterest expense of $47 million for first quarter 2024 decreased $3 million from fourth quarter 2023. Personnel expense was minimally changed with higher salaries and incentives substantially offset by lower health insurance and a decrease in the fair value of nonqualified deferred compensation plan liabilities. Non-personnel expenses decreased $3 million (12%) between the sequential quarters, mostly lower data processing from an early contract termination charge in fourth quarter 2023.

About Nicolet Bankshares, Inc.

Nicolet Bankshares, Inc. is the bank holding company of Nicolet National Bank, a growing, full-service, community bank providing services ranging from commercial, agricultural and consumer banking to wealth management and retirement plan services. Founded in Green Bay in 2000, Nicolet National Bank operates branches primarily in Wisconsin, Michigan, and Minnesota. More information can be found at www.nicoletbank.com.

Use of Non-GAAP Financial Measures

This communication contains non-GAAP financial measures, such as non-GAAP adjusted net income, non-GAAP adjusted earnings per diluted common share, tangible book value per common share, return on average tangible common equity, and tangible common equity to tangible assets. Management believes such measures to be helpful to management, investors and others in understanding Nicolet’s results of operations or financial position. When non-GAAP financial measures are used, the comparable GAAP financial measures, as well as the reconciliation of the non-GAAP measures to the GAAP financial measures, are provided. See “Reconciliation of Non-GAAP Financial Measures (Unaudited)” below. The non-GAAP net income measure and related reconciliation provide information useful to investors in understanding the operating performance and trends of Nicolet and also aid investors in comparing Nicolet’s financial performance to the financial performance of peer banks. Management considers non-GAAP financial ratios to be critical metrics with which to analyze and evaluate financial condition and capital strengths. While non-GAAP financial measures are frequently used by stakeholders in the evaluation of a corporation, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of results as reported under GAAP.

Forward Looking Statements “Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995

Certain statements contained in this communication, which are not statements of historical fact, constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act. Forward-looking statements generally can be identified by words or phrases such as, without limitation, “anticipate,” “believe,” “aim,” “can,” “conclude,” “continue,” “could,” “estimate,” “expect,” “foresee,” “goal,” “intend,” “may,” “might,” “outlook,” “possible,” “plan,” “predict,” “project,” “potential,” “seek,” “should,” “target,” “will,” “will likely,” “would,” or the negative of these terms or other comparable terminology, as well as similar expressions, and in this press release include our statements about potential M&A, share buyback, and dividend activity.

Forward-looking statements are not historical facts but instead express only management’s beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management’s control. It is possible that actual results and outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements. Risks, uncertainties and other factors that could cause the actual results to differ materially from the statements, include, but are not limited to future legislative changes to the taxes imposed upon Nicolet, potential expansion into other jurisdictions that impose different or higher taxes and our ability to generate loans that qualify for the Wisconsin tax reduction / elimination. Additional factors which could affect the forward looking statements can be found in Nicolet’s 2023 Annual Report on Form 10-K, as well subsequent filings with the SEC and are available on the SEC’s website at www.sec.gov.

Any forward-looking statements included in this press release are made as of the date hereof and are based on information available to management at that time. Except as required by law, Nicolet disclaims any obligation to update or revise any forward-looking statement contained in this press release to reflect new information or events or circumstances that occur after the date the forward-looking statements were made.

Nicolet Bankshares, Inc.
Consolidated Balance Sheets (Unaudited)
(In thousands, except share data)		3/31/2024				12/31/2023				9/30/2023				6/30/2023				3/31/2023
Assets
Cash and due from banks		$	81,677			$	129,898			$	109,414			$	122,021			$	93,462
Interest-earning deposits			345,747				361,533				436,466				383,185				20,718
Cash and cash equivalents			427,424				491,431				545,880				505,206				114,180
Certificates of deposit in other banks			5,639				6,374				7,598				9,808				11,293
Securities available for sale, at fair value			803,963				802,573				793,826				921,108				1,023,176
Other investments			60,464				57,560				58,367				57,578				57,482
Loans held for sale			5,022				4,160				6,500				3,849				4,962
Loans			6,397,617				6,353,942				6,239,257				6,222,776				6,223,732
Allowance for credit losses - loans			(64,347	)			(63,610	)			(63,160	)			(62,811	)			(62,412	)
Loans, net			6,333,270				6,290,332				6,176,097				6,159,965				6,161,320
Premises and equipment, net			119,962				118,756				117,744				117,278				112,569
Bank owned life insurance (“BOLI”)			170,746				169,392				168,223				167,192				166,107
Goodwill and other intangibles, net			393,183				394,366				396,208				398,194				400,277
Accrued interest receivable and other assets			126,989				133,734				145,719				142,450				140,988
Total assets		$	8,446,662			$	8,468,678			$	8,416,162			$	8,482,628			$	8,192,354
Liabilities and Stockholders' Equity
Liabilities:
Noninterest-bearing demand deposits		$	1,665,229			$	1,958,709			$	2,020,074			$	2,059,939			$	2,094,623
Interest-bearing deposits			5,500,503				5,239,091				5,162,314				5,138,665				4,833,956
Total deposits			7,165,732				7,197,800				7,182,388				7,198,604				6,928,579
Short-term borrowings			—				—				—				50,000				50,000
Long-term borrowings			162,257				166,930				197,754				197,577				197,448
Accrued interest payable and other liabilities			55,018				64,941				61,559				58,809				54,535
Total liabilities			7,383,007				7,429,671				7,441,701				7,504,990				7,230,562
Stockholders' Equity:
Common stock			149				149				147				147				147
Additional paid-in capital			636,621				633,770				626,348				624,897				623,746
Retained earnings			482,295				458,261				431,317				417,863				398,966
Accumulated other comprehensive income (loss)			(55,410	)			(53,173	)			(83,351	)			(65,269	)			(61,067	)
Total stockholders' equity			1,063,655				1,039,007				974,461				977,638				961,792
Total liabilities and stockholders' equity		$	8,446,662			$	8,468,678			$	8,416,162			$	8,482,628			$	8,192,354
Common shares outstanding			14,930,549				14,894,209				14,757,565				14,717,938				14,698,265

Nicolet Bankshares, Inc.
Consolidated Statements of Income (Loss) (Unaudited)
		For the Three Months Ended
(In thousands, except per share data)		3/31/2024			12/31/2023			9/30/2023				6/30/2023				3/31/2023
Interest income:
Loans, including loan fees		$	93,648		$	90,265		$	87,657			$	84,091			$	79,142
Taxable investment securities			4,557			4,737			4,351				4,133				4,961
Tax-exempt investment securities			1,238			1,394			1,424				1,476				1,737
Other interest income			4,588			7,149			6,452				2,357				1,536
Total interest income			104,031			103,545			99,884				92,057				87,376
Interest expense:
Deposits			38,990			36,583			34,964				29,340				24,937
Short-term borrowings			—			—			474				1,108				3,212
Long-term borrowings			2,234			2,680			2,972				2,570				2,506
Total interest expense			41,224			39,263			38,410				33,018				30,655
Net interest income			62,807			64,282			61,474				59,039				56,721
Provision for credit losses			750			1,000			450				450				3,090
Net interest income after provision for credit losses			62,057			63,282			61,024				58,589				53,631
Noninterest income:
Wealth management fee income			6,485			6,308			6,057				5,870				5,512
Mortgage income, net			1,364			1,856			2,020				1,822				1,466
Service charges on deposit accounts			1,581			1,475			1,492				1,529				1,480
Card interchange income			3,098			3,306			3,321				3,331				3,033
BOLI income			1,347			1,161			1,090				1,073				1,200
Asset gains (losses), net			1,909			5,947			31				(318	)			(38,468	)
Deferred compensation plan asset market valuations			59			949			(457	)			499				946
LSR income, net			1,134			1,027			1,108				1,135				1,155
Other noninterest income			2,445			2,405			1,879				1,900				1,832
Total noninterest income			19,422			24,434			16,541				16,841				(21,844	)
Noninterest expense:
Personnel expense			26,510			26,937			23,944				23,900				24,328
Occupancy, equipment and office			8,944			9,567			9,027				8,845				8,783
Business development and marketing			2,142			1,854			1,869				1,946				2,121
Data processing			4,270			7,043			4,643				4,218				3,988
Intangibles amortization			1,833			1,842			1,986				2,083				2,161
FDIC assessments			1,033			950			1,500				1,009				540
Merger-related expense			—			—			—				26				163
Other noninterest expense			2,415			2,103			2,769				2,930				2,791
Total noninterest expense			47,147			50,296			45,738				44,957				44,875
Income (loss) before income tax expense			34,332			37,420			31,827				30,473				(13,088	)
Income tax expense (benefit)			6,542			6,759			14,669				7,878				(4,190	)
Net income (loss)		$	27,790		$	30,661		$	17,158			$	22,595			$	(8,898	)
Earnings (loss) per common share:
Basic		$	1.86		$	2.07		$	1.16			$	1.54			$	(0.61	)
Diluted		$	1.82		$	2.02		$	1.14			$	1.51			$	(0.61	)
Common shares outstanding:
Basic weighted average			14,907			14,823			14,740				14,711				14,694
Diluted weighted average			15,249			15,142			15,100				14,960				14,694

Nicolet Bankshares, Inc.
Consolidated Financial Summary (Unaudited)
		For the Three Months Ended
(In thousands, except share & per share data)		3/31/2024				12/31/2023				9/30/2023				6/30/2023				3/31/2023
Selected Average Balances:
Loans		$	6,398,838			$	6,263,971			$	6,230,336			$	6,237,757			$	6,201,780
Investment securities			884,775				897,437				962,607				1,068,144				1,508,535
Interest-earning assets			7,629,120				7,683,495				7,676,895				7,497,935				7,830,590
Cash and cash equivalents			364,375				558,473				513,250				203,883				127,726
Goodwill and other intangibles, net			393,961				395,158				397,052				399,080				401,212
Total assets			8,380,595				8,415,169				8,417,456				8,228,600				8,570,623
Deposits			7,112,971				7,189,650				7,156,577				6,941,037				7,060,262
Interest-bearing liabilities			5,509,882				5,358,445				5,385,292				5,212,285				5,391,107
Stockholders’ equity (common)			1,048,596				996,745				983,133				967,142				970,108
Selected Ratios: (1)
Book value per common share		$	71.24			$	69.76			$	66.03			$	66.42			$	65.44
Tangible book value per common share (2)		$	44.91			$	43.28			$	39.18			$	39.37			$	38.20
Return on average assets			1.33	%			1.45	%			0.81	%			1.10	%			(0.42	)%
Return on average common equity			10.66				12.20				6.92				9.37				(3.72	)
Return on average tangible common equity (2)			17.07				20.22				11.62				15.95				(6.34	)
Average equity to average assets			12.51				11.84				11.68				11.75				11.32
Stockholders’ equity to assets			12.59				12.27				11.58				11.53				11.74
Tangible common equity to tangible assets (2)			8.33				7.98				7.21				7.17				7.21
Net interest margin			3.26				3.30				3.16				3.14				2.91
Efficiency ratio			58.34				60.41				58.27				58.60				60.69
Effective tax rate			19.06				18.06				46.09				25.85				32.01
Selected Asset Quality Information:
Nonaccrual loans		$	26,677			$	26,625			$	29,507			$	25,278			$	38,895
Other real estate owned - closed branches			808				808				884				958				1,347
Other real estate owned			437				459				1,147				520				628
Nonperforming assets		$	27,922			$	27,892			$	31,538			$	26,756			$	40,870
Net loan charge-offs (recoveries)		$	13			$	550			$	101			$	51			$	167
Allowance for credit losses-loans to loans			1.01	%			1.00	%			1.01	%			1.01	%			1.00	%
Net loan charge-offs to average loans (1)			0.00				0.03				0.01				0.01				0.01
Nonperforming loans to total loans			0.42				0.42				0.47				0.41				0.62
Nonperforming assets to total assets			0.33				0.33				0.37				0.32				0.50
Stock Repurchase Information:
Common stock repurchased (dollars) (3)		$	—			$	—			$	—			$	1,519			$	—
Common stock repurchased (full shares) (3)			—				—				—				26,853				—

(1)		Income statement-related ratios for partial-year periods are annualized.
(2)		See Reconciliation of Non-GAAP Financial Measures below for a reconciliation of these financial measures.
(3)		Reflects common stock repurchased under board of director authorizations for the common stock repurchase program.

Nicolet Bankshares, Inc.
Consolidated Loan & Deposit Metrics (Unaudited)
(In thousands)		3/31/2024			12/31/2023			9/30/2023			6/30/2023			3/31/2023
Period End Loan Composition
Commercial & industrial		$	1,307,490		$	1,284,009		$	1,237,789		$	1,318,567		$	1,330,052
Owner-occupied commercial real estate (“CRE”)			955,786			956,594			971,397			969,202			969,064
Agricultural			1,190,371			1,161,531			1,108,261			1,068,999			1,065,909
Commercial			3,453,647			3,402,134			3,317,447			3,356,768			3,365,025
CRE investment			1,188,722			1,142,251			1,130,938			1,108,692			1,146,388
Construction & land development			241,730			310,110			326,747			337,389			333,370
Commercial real estate			1,430,452			1,452,361			1,457,685			1,446,081			1,479,758
Commercial-based loans			4,884,099			4,854,495			4,775,132			4,802,849			4,844,783
Residential construction			84,370			75,726			76,289			108,095			134,782
Residential first mortgage			1,167,069			1,167,109			1,136,748			1,072,609			1,014,166
Residential junior mortgage			206,434			200,884			195,432			184,873			177,026
Residential real estate			1,457,873			1,443,719			1,408,469			1,365,577			1,325,974
Retail & other			55,645			55,728			55,656			54,350			52,975
Retail-based loans			1,513,518			1,499,447			1,464,125			1,419,927			1,378,949
Total loans		$	6,397,617		$	6,353,942		$	6,239,257		$	6,222,776		$	6,223,732
Period End Deposit Composition
Noninterest-bearing demand		$	1,665,229		$	1,958,709		$	2,020,074		$	2,059,939		$	2,094,623
Interest-bearing demand			1,121,030			1,055,520			955,746			1,030,919			1,138,415
Money market			2,027,559			1,891,287			1,933,227			1,835,523			1,886,879
Savings			765,084			768,401			789,045			821,803			865,824
Time			1,586,830			1,523,883			1,484,296			1,450,420			942,838
Total deposits		$	7,165,732		$	7,197,800		$	7,182,388		$	7,198,604		$	6,928,579
Brokered transaction accounts		$	265,818		$	166,861		$	146,517		$	173,107		$	233,393
Brokered time deposits			517,190			448,582			457,433			566,405			289,181
Total brokered deposits		$	783,008		$	615,443		$	603,950		$	739,512		$	522,574
Customer transaction accounts		$	5,313,085		$	5,507,056		$	5,551,575		$	5,575,077		$	5,752,348
Customer time deposits			1,069,639			1,075,301			1,026,863			884,015			653,657
Total customer deposits (core)		$	6,382,724		$	6,582,357		$	6,578,438		$	6,459,092		$	6,406,005

Nicolet Bankshares, Inc.
Net Interest Income and Net Interest Margin Analysis (Unaudited)
		For the Three Months Ended
		March 31, 2024									December 31, 2023									March 31, 2023
		Average						Average			Average						Average			Average						Average
(In thousands)		Balance			Interest			Rate			Balance			Interest			Rate			Balance			Interest			Rate
ASSETS
Total loans (1) (2)		$	6,398,838		$	93,744		5.81	%		$	6,263,971		$	90,313		5.66	%		$	6,201,780		$	79,186		5.11	%
Investment securities (2)			884,775			6,197		2.80	%			897,437			6,567		2.93	%			1,508,535			7,246		1.93	%
Other interest-earning assets			345,507			4,588		5.26	%			522,087			7,149		5.37	%			120,275			1,536		5.11	%
Total interest-earning assets			7,629,120		$	104,529		5.44	%			7,683,495		$	104,029		5.32	%			7,830,590		$	87,968		4.49	%
Other assets, net			751,475									731,674									740,033
Total assets		$	8,380,595								$	8,415,169								$	8,570,623
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing core deposits		$	4,664,670		$	31,256		2.69	%		$	4,570,493		$	29,730		2.58	%		$	4,325,340		$	19,587		1.84	%
Brokered deposits			680,124			7,734		4.57	%			601,379			6,853		4.52	%			566,282			5,350		3.83	%
Total interest-bearing deposits			5,344,794			38,990		2.93	%			5,171,872			36,583		2.81	%			4,891,622			24,937		2.07	%
Wholesale funding			165,088			2,234		5.35	%			186,573			2,680		5.62	%			499,485			5,718		4.58	%
Total interest-bearing liabilities			5,509,882		$	41,224		3.01	%			5,358,445		$	39,263		2.90	%			5,391,107		$	30,655		2.30	%
Noninterest-bearing demand deposits			1,768,177									2,017,778									2,168,640
Other liabilities			53,940									42,201									40,768
Stockholders' equity			1,048,596									996,745									970,108
Total liabilities and stockholders' equity		$	8,380,595								$	8,415,169								$	8,570,623
Net interest income and rate spread					$	63,305		2.43	%					$	64,766		2.42	%					$	57,313		2.19	%
Net interest margin								3.26	%								3.30	%								2.91	%
Loan purchase accounting accretion (3)					$	1,527		0.09	%					$	1,587		0.10	%					$	1,636		0.11	%

(1)		Nonaccrual loans and loans held for sale are included in the daily average loan balances outstanding.
(2)		The yield on tax-exempt loans and tax-exempt investment securities is computed on a tax-equivalent basis using a federal tax rate of 21%, and adjusted for the disallowance of interest expense.
(3)		Loan purchase accounting accretion included in Total loans above, and the related impact to net interest margin.

Nicolet Bankshares, Inc.
Reconciliation of Non-GAAP Financial Measures (Unaudited)
		For the Three Months Ended
(In thousands, except per share data)		3/31/2024				12/31/2023				9/30/2023				6/30/2023			3/31/2023
Adjusted net income (loss) reconciliation: (1)
Net income (loss) (GAAP)		$	27,790			$	30,661			$	17,158			$	22,595		$	(8,898	)
Adjustments:
Provision expense (2)			—				—				—				—			2,340
Assets (gains) losses, net			(1,909	)			(5,947	)			(31	)			318			38,468
Merger-related expense			—				—				—				26			163
Contract termination charge			—				2,689				—				—			—
Adjustments subtotal			(1,909	)			(3,258	)			(31	)			344			40,971
Tax on Adjustments (3)			(372	)			(635	)			(6	)			86			10,243
Tax - Wisconsin Tax Law Change (4)			—				—				6,151				—			—
Adjusted net income (Non-GAAP)		$	26,253			$	28,038			$	23,284			$	22,853		$	21,830
Diluted earnings (loss) per common share:
Diluted earnings (loss) per common share (GAAP)		$	1.82			$	2.02			$	1.14			$	1.51		$	(0.61	)
Adjusted Diluted earnings per common share (Non-GAAP)		$	1.72			$	1.85			$	1.54			$	1.53		$	1.45
Tangible assets: (5)
Total assets		$	8,446,662			$	8,468,678			$	8,416,162			$	8,482,628		$	8,192,354
Goodwill and other intangibles, net			393,183				394,366				396,208				398,194			400,277
Tangible assets		$	8,053,479			$	8,074,312			$	8,019,954			$	8,084,434		$	7,792,077
Tangible common equity: (5)
Stockholders’ equity (common)		$	1,063,655			$	1,039,007			$	974,461			$	977,638		$	961,792
Goodwill and other intangibles, net			393,183				394,366				396,208				398,194			400,277
Tangible common equity		$	670,472			$	644,641			$	578,253			$	579,444		$	561,515
Tangible average common equity: (5)
Average stockholders’ equity (common)		$	1,048,596			$	996,745			$	983,133			$	967,142		$	970,108
Average goodwill and other intangibles, net			393,961				395,158				397,052				399,080			401,212
Average tangible common equity		$	654,635			$	601,587			$	586,081			$	568,062		$	568,896

Note: Numbers may not sum due to rounding.
(1)		The adjusted net income measure and related reconciliation provide information useful to investors in understanding the operating performance and trends of Nicolet and also to aid investors in the comparison of Nicolet’s financial performance to the financial performance of peer banks.
(2)		Provision expense for 2023 is attributable to the expected loss on a bank subordinated debt investment.
(3)		The effective tax rate for periods prior to the July 1, 2023, effective date of the Wisconsin tax law change assumed an effective tax rate of 25%, and periods subsequent to the effective date assumed an effective tax rate of 19.5%.
(4)		The adjusted net income reconciliation for first and second quarter 2023 is as originally reported, and has not been restated to reflect the $3 million excess tax expense of those quarters that was subsequently reversed in third quarter 2023 due to the Wisconsin tax law change. Thus, the adjusted net income reconciliation for the quarters of 2023 will not sum to the full year impact.
(5)		The ratios of tangible book value per common share, return on average tangible common equity, and tangible common equity to tangible assets exclude goodwill and other intangibles, net. These financial ratios have been included as they are considered to be critical metrics with which to analyze and evaluate financial condition and capital strength.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240416543876/en/

ir@nicoletbank.com

Source: Nicolet Bankshares, Inc.

FAQ

What was Nicolet Bankshares, Inc.'s net income for the first quarter of 2024?

Nicolet Bankshares, Inc. reported a net income of $28 million for the first quarter of 2024.

What was the tangible common equity ratio for Nicolet Bankshares, Inc. in the first quarter of 2024?

The tangible common equity ratio for Nicolet Bankshares, Inc. increased to 8.33% for the first quarter of 2024.

What was the return on average tangible common equity for Nicolet Bankshares, Inc. in the first quarter of 2024?

Nicolet Bankshares, Inc. achieved a return on average tangible common equity of 17.07% in the first quarter of 2024.

What was the tangible book value per share for Nicolet Bankshares, Inc. in the first quarter of 2024?

The tangible book value per share for Nicolet Bankshares, Inc. was $44.91 for the first quarter of 2024.

What are the capital deployment options for Nicolet Bankshares, Inc.?

Nicolet Bankshares, Inc. has various options for capital deployment, including organic growth, M&A, and capital return to shareholders through share buybacks and dividends.