Simmons First National Corporation Reports Second Quarter 2022 Earnings

Rhea-AI Summary

Simmons First National Corporation (NASDAQ: SFNC) reported a net income of $27.5 million for Q2 2022, a significant decrease from $65.1 million in Q1 2022 and $74.9 million in Q2 2021. Diluted EPS was $0.21, down from $0.58 in Q1 2022. The quarter was affected by merger-related costs of $19.1 million due to the acquisition of Spirit of Texas Bancshares. However, revenue increased by 20% linked quarter, driven by net interest income growth. Total loans rose 26% to $15.1 billion, with strong capital ratios supporting further growth.

Positive

• Revenue increased by 20% linked quarter, driven by solid net interest income growth.
• Total loans rose 26% linked quarter to $15.1 billion.
• Annualized organic loan growth exceeded 25%.
• Net interest margin expanded significantly to 3.24%.

Negative

• Net income dropped to $27.5 million from $65.1 million in Q1 2022.
• Diluted EPS decreased to $0.21, down from $0.58 in Q1 2022.
• Noninterest expenses increased 22% linked quarter, driven by merger-related costs.

George A. Makris, Jr., Simmons’ Chairman and CEO, commented on the quarter

Although second quarter results were significantly impacted by accounting adjustments and one-time merger expenses related to our acquisition of Spirit of Texas Bancshares during the quarter, Simmons’ operating results excluding these items were extremely strong. Highlights for the quarter include a significant increase in revenue, well contained operating expense growth, improved asset quality, annualized organic loan growth in excess of 25 percent, marked improvement in the efficiency ratio, substantial expansion of the net interest margin, and excellent capital ratios.

Our strategy of restructuring our loan portfolio over the past two years not only diversified the risk profile but also established capacity which should provide the foundation for additional loan and revenue growth, which is evident in our loan pipeline and unfunded commitments. Our liquidity is solid, and our capital is strong. We are growing in all markets as demonstrated by the addition of nearly 2,000 new business deposit accounts in the quarter.

Thanks to our continuing investment in technology associated with our NGB project, our digital products continue to be expanded and our Chief Digital Officer, Alex Carriles, was recently recognized as a “Digital Banker of the Year” by American Banker. Other initiatives, such as the engagement of Disney Institute to help us focus on our customer service standards, will continue to headline our “Better Bank” objective.

I am very proud of the members of our Simmons team who truly exemplify our Better Together cultural cornerstone.

Financial Highlights	2Q22			1Q22			2Q21			Second Quarter Highlights
Financial Results (in millions)										Diluted EPS was $0.21 and adjusted diluted EPS was $0.52 Revenue increased 20% on a linked quarter basis driven by the acquisition of Spirit, solid legacy SFNC net interest income growth and net interest margin expansion Noninterest expenses increased 22% on a linked quarter basis. Excluding merger related costs and certain other items, adjusted noninterest expense increased 9% Provision for credit losses totaled $33.9 million, reflecting Day 2 accounting provision for acquired loans and unfunded commitments Total loans up 26% and total deposits up 14% on a linked quarter basis. Legacy SFNC loans up 7% and deposits relatively unchanged Credit quality metrics reflect conservative risk profile and strategic decision in 2019 to de-risk acquired loan portfolios Common equity to assets ratio at 11.98%; TCE ratio at 7.03%
Revenue	$225.4			$187.9			$188.5
Noninterest expense	156.8			128.4			114.7
Pre-provision net revenue(1)	68.6			59.5			73.9
Merger related costs	19.1			1.9			0.7
Adjusted pre-provision net revenue(1)	88.1			62.3			74.6
Provision for credit losses	33.9			(19.9	)		(13.0	)
Net income	27.5			65.1			74.9
Per Share Data
Diluted earnings	$0.21			$0.58			$0.69
Adjusted diluted earnings(1)	0.52			0.59			0.69
Book value	25.31			26.32			28.03
Tangible book value(1)	14.07			15.22			17.16
Avg diluted shares outstanding (000s)	128,720			113,027			108,822
Balance Sheet (in millions)
Total loans	$15,110			$12,029			$11,386
Total deposits	22,036			19,392			18,305
Total shareholders’ equity	3,260			2,962			3,039
Asset Quality
Net charge-off ratio	0.02	%		0.22	%		(0.07	)%
Nonperforming loan ratio	0.42			0.53			0.71
Nonperforming assets to total assets	0.26			0.29			0.42
Allowance for credit losses to total loans	1.41			1.49			2.00
Nonperforming loan coverage ratio	334			278			281
Select Ratios
Net interest margin (FTE)	3.24			2.76			2.89
Efficiency ratio(1)	57.49			62.95			56.75
Loan to deposit ratio	68.57			62.03			62.20
Common equity tier 1 (CET1) ratio	12.10			13.52			14.20
Total risk-based capital ratio	14.83			16.42			17.49

^{Revenue is defined as net interest income plus noninterest income excluding gain (loss) on sale of securities
(1) Non-GAAP measurement. See “Reconciliation of Non-GAAP Financial Measures” below
FTE – fully taxable equivalent using a tax rate of 26.135%}

PINE BLUFF, Ark., July 21, 2022 (GLOBE NEWSWIRE) -- Simmons First National Corporation (NASDAQ: SFNC) (Simmons or Company) today reported net income of $27.5 million for the second quarter of 2022, compared to $65.1 million in the first quarter of 2022 and $74.9 million in the second quarter of 2021. Diluted earnings per share were $0.21 for the second quarter of 2022, compared to $0.58 for the first quarter of 2022 and $0.69 for the second quarter of 2021. Included in second quarter 2022 results were $14.4 million (after-tax) of certain items, primarily merger-related expenses associated with our acquisition of Spirit of Texas Bancshares, Inc. (Spirit) that was completed on April 8, 2022. Certain items, consisting primarily of merger-related expenses and branch right-sizing costs, totaled $2.1 million (after-tax) in the first quarter of 2022 and $0.5 million (after-tax) in the second quarter of 2021.

Additionally, second quarter 2022 results included a $33.8 million Day 2 accounting provision required for loans and unfunded commitments acquired in connection with our second quarter acquisition. Excluding these items, adjusted diluted earnings per share were $0.52 for the second quarter of 2022, $0.59 for the first quarter of 2022 and $0.69 for the second quarter of 2021.

Impact of Certain Items on Earnings and Diluted EPS

$ in millions, except per share data	Q2 22			Q1 22			Q2 21
Net income	$	27.5		$	65.1		$	74.9
Day 2 accounting provision		33.8			-			-
Merger related expenses		19.1			1.9			0.7
Branch right sizing costs, net		0.4			0.9			-
Total pre-tax impact		53.3			2.8			0.7
Tax effect(1)		(14.0	)		(0.7	)		(0.2	)
Total impact on earnings		39.3			2.1			0.5
Adjusted earnings(2)	$	66.8		$	67.2		$	75.4
Diluted EPS	$	0.21		$	0.58		$	0.69
Day 2 accounting provision		0.26			-			-
Merger related expenses		0.15			0.01			0.01
Branch right sizing costs		-			0.01			-
Total pre-tax impact		0.41			0.02			0.01
Tax effect(1)		(0.10	)		(0.01	)		(0.01	)
Total impact on earnings		0.31			0.01			-
Adjusted Diluted EPS(2)	$	0.52		$	0.59		$	0.69
Average diluted shares outstanding	128,720,078			113,026,911			108,822,175

^{(1) Effective tax rate of 26.135%
(2) Non-GAAP measurement. See “Reconciliation of Non-GAAP Financial Measures” below}

Net Interest Income
Net interest income for the second quarter of 2022 totaled $185.1 million, compared to $145.6 million in the first quarter of 2022 and $146.5 million for the second quarter of 2021. Included in net interest income is accretion recognized on loans acquired, which totaled $9.9 million in the second quarter of 2022, $3.7 million in the first quarter of 2022 and $5.6 million in the second quarter of 2021. Also included in net interest income is interest income from Paycheck Protection Program (PPP) loans totaling $1.6 million in the second quarter of 2022, $2.1 million in the first quarter of 2022 and $9.0 million in the second quarter of 2021. The increase in net interest income on a linked quarter basis was driven by a $43.1 million increase in interest income, that was fueled by SFNC legacy net loan growth, the added contribution from loans acquired in the Spirit acquisition and higher yields on loans and investment securities. The increase in net interest income was also positively impacted by a significant decrease in the level of variable rate loans at or below their interest rate floors during the quarter. These items more than offset the $3.6 million increase in interest expense on a linked quarter basis, which was partially attributable to the addition of deposits acquired in the Spirit acquisition.

The yield on loans for the second quarter of 2022 was 4.54 percent, compared to 4.34 percent in the first quarter of 2022 and 4.73 percent in the second quarter of 2021. The yield on investments securities for the second quarter of 2022 was 2.08 percent, compared to 1.86 percent in the first quarter of 2022 and 1.97 percent in the second quarter of 2021. Cost of deposits for the second quarter of 2022 were relatively stable at 18 basis points, compared to 14 basis points in the first quarter of 2022 and below the 24 basis points incurred during the second quarter of 2021. Net interest margin on a fully taxable equivalent basis for the second quarter of 2022 was 3.24 percent, compared to 2.76 percent for the first quarter of 2022 and 2.89 percent for the second quarter of 2021. Excluding the impact of PPP loan interest income, the net interest margin was 3.22 percent for the second quarter of 2022, 2.74 percent for the first quarter of 2022 and 2.81 percent for the second quarter of 2021.

	Q2 22		Q1 22		Q4 21		Q3 21		Q2 21
Loan yield (FTE) (1)	4.54	%	4.34	%	4.58	%	4.76	%	4.73	%
Security yield (FTE) (1)	2.08		1.86		1.74		1.77		1.97
Cost of interest bearing deposits	0.25		0.19		0.23		0.27		0.32
Cost of deposits	0.18		0.14		0.17		0.20		0.24
Cost of borrowed funds	2.13		1.94		1.95		1.96		1.97
Net interest spread (FTE) (1)	3.11		2.66		2.74		2.72		2.74
Net interest margin (FTE) (1)	3.24		2.76		2.86		2.85		2.89

(1) Fully tax equivalent using an effective tax rate of 26.135%.

Noninterest Income
Noninterest income for the second quarter of 2022 was $40.2 million, compared to $42.2 million in the first quarter of 2022 and $47.1 million in the second quarter of 2021. Included in noninterest income in the first quarter of 2022 was a settlement award totaling $1.4 million. Gains (losses) on sales of investment securities totaled $(150) thousand in the second quarter of 2022, $(54) thousand in the first quarter of 2022 and $5.1 million in the second quarter of 2021. The decrease in noninterest income on a linked quarter basis was primarily attributable to an expected decline in mortgage lending income given the higher interest rate environment and softening market conditions, and the previously mentioned settlement award. These declines were offset, in part, by an increase in debit and credit card fees, and an increase in service charges on deposit accounts that was aided by the addition of Spirit.

Select Noninterest Income Items $ in millions	Q2 22			Q1 22			Q4 21			Q3 21			Q2 21
Service charges on deposit accounts	$	11.4		$	10.7		$	11.9		$	11.6		$	10.1
Wealth management fees		7.2			8.0			8.0			7.9			7.9
Debit and credit card fees (1)		8.2			7.4			7.5			7.1			7.1
Mortgage lending income		2.2			4.6			5.0			5.8			4.5
Bank owned life insurance		2.6			2.7			2.8			2.6			2.0
Gain (loss) on sale of securities		(0.2	)		(0.1	)		(0.3	)		5.2			5.1
Other income		6.8			7.3			10.0			6.4			8.4
Adjusted other income (2)		6.9			7.3			10.0			6.7			8.0

^{(1) During the second quarter of 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest income. Prior periods have been adjusted to reflect this reclassification.
(2) Adjusted figures exclude certain items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.}

Noninterest Expense
Noninterest expense for the second quarter of 2022 was $156.8 million, compared to $128.4 million in the first quarter of 2022 and $114.7 in the second quarter of 2021. Included in noninterest expense in the second quarter of 2022 is a $1.6 million contribution to the Simmons First Foundation Conservation Fund, reflecting a portion of paper statement fees collected as part of a promotion to encourage customers to enroll in eStatements. Also included in noninterest expense are certain non-core items, primarily associated with merger related and branch right-sizing costs, totaling $19.4 million in the second quarter of 2022, $2.8 million in the first quarter of 2022 and $1.2 million in the second quarter of 2021. Excluding these items, adjusted noninterest expense for the second quarter of 2022 was $137.4 million, compared to $125.6 million in the first quarter of 2022 and $113.5 million in the second quarter of 2021. The increase in adjusted noninterest expense on a linked quarter basis was primarily attributable to operating expenses associated with Spirit. The increase in adjusted noninterest expense on a year-over-year basis primarily reflects increased operating expenses associated with the acquisition of Spirit, and the acquisitions of Landmark Community Bank and Triumph Bancshares, Inc. in the fourth quarter of 2021.

Select Noninterest Expense Items $ in millions	Q2 22			Q1 22			Q4 21			Q3 21			Q2 21
Salaries and employee benefits	$	74.1		$	67.9		$	63.9		$	61.9		$	60.3
Occupancy expense, net		11.0			10.0			11.0			9.4			9.1
Furniture and equipment		5.1			4.8			4.7			4.9			4.9
Merger related costs		19.1			1.9			13.6			1.4			0.7
Other operating expenses (1)		44.5			41.6			45.7			34.6			37.2
Adjusted salaries and employee benefits (2)		74.1			67.9			63.8			61.8			60.3
Adjusted other operating expenses (2)		44.5			40.9			45.8			38.3			37.1

^{(1) During the second quarter of 2021, certain debit and credit card transaction fees were reclassified from noninterest expense to noninterest income. Prior periods have been adjusted to reflect this reclassification.
(2) Adjusted figures exclude certain items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.}

Loans and Unfunded Loan Commitments
Total loans at the end of the second quarter of 2022 were $15.1 billion, compared to $12.0 billion at the end of the first quarter of 2022 and $11.4 billion at the end of the second quarter of 2021. The increase in total loans on a linked quarter basis reflected the addition of $2.3 billion of loans (net of fair value adjustments) associated with the acquisition of Spirit. Excluding Spirit loans acquired at closing, net loan growth on a linked quarter basis was $822 million, or 7 percent. Net loan growth in the quarter was also driven by increased activity throughout our geographic footprint, which more than offset an anticipated decline in mortgage warehouse lending given current market conditions, as well as the continued forgiveness of PPP loans. Additionally, loan growth was weighted toward the latter half of the quarter as average total loans for the second quarter of 2022 were $14.5 billion. The higher level of period end loan balances compared to average balances should provide a platform for interest income growth going forward.

Unfunded commitments increased for the fifth consecutive quarter to $4.5 billion, up 30 percent on a linked quarter basis. Continued growth in this measure was aided by the addition of Spirit, and we believe reflects the Company’s ability to organically attract new customers throughout its franchise while also deepening relationships with existing customers. At the same time, momentum in our commercial loan pipeline continued to strengthen with all loan opportunities, including the addition of Spirit, totaling $3.0 billion at the end of the second quarter of 2022, up 28 percent on a linked quarter basis. This marked the seventh consecutive quarter of increased activity in our commercial loan pipeline. Commercial loans approved and ready to close at the end of the second quarter totaled $1.1 billion and the rate on ready to close commercial loans was 4.45 percent, up 102 basis points from the rate on ready to close commercial loans at the end of the first quarter of 2022.

$ in millions	Q2 22		Q1 22		Q4 21		Q3 21		Q2 21
Total loans	$15,110		$12,029		$12,013		$10,825		$11,386
Spirit loans, net of fair value adjustments	2,259
Total loans (excluding Spirit)(1) (2)	$12,851
Linked quarter change in loans	26	%
Linked quarter change in loans (excluding Spirit)(1) (2)	7
PPP loans	$19		$62		$117		$212		$441
Mortgage warehouse loans	168		166		230		275		307
Energy loans	55		48		105		128		174
Unfunded loan commitments	$4,473		$3,428		$2,943		$2,254		$2,130

^{(1) Adjusted figures exclude certain items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” below
(2) Loans excluding Spirit loans are also referred to as “Legacy SFNC loans” in this earnings release.}

Deposits
Total deposits at the end of the second quarter of 2022 were $22.0 billion, compared to $19.4 billion at the end of the first quarter of 2022 and $18.3 billion at the end of the second quarter of 2021. The increase in total deposits on a linked quarter basis reflected the addition of $2.7 billion of deposits (net of fair value adjustments) associated with the acquisition of Spirit. Excluding Spirit deposits acquired at closing, total deposits were relatively unchanged on a linked quarter basis, decreasing less than 1 percent. Noninterest bearing deposits totaled $6.1 billion at the end of the second quarter of 2022 and represented 27 percent of total deposits, unchanged from first quarter of 2022 levels. Interest bearing deposits (checking, savings and money market accounts) totaled $12.8 billion at the end of the second quarter of 2022 and represented 58 percent of total deposits, compared to 62 percent of total deposits at the end of the first quarter of 2022. Conversely, time deposits totaled $3.2 billion at the end of the second quarter of 2022 and represented 14 percent of total deposits, up from 11 percent at the end of the first quarter of 2022. The change in mix of deposits on a linked quarter basis is partially attributable to the attractiveness of higher rate deposits given the rapid increase in interest rates that has occurred during 2022, coupled with the mix of deposits acquired from Spirit. The loan to deposit ratio ended the second quarter of 2022 at 69 percent, up from 62 percent at the end of both the first quarter of 2022 and the second quarter of 2021.

$ in millions	Q2 22		Q1 22		Q4 21		Q3 21		Q2 21
Noninterest bearing deposits	$6,057		$5,224		$5,325		$4,919		$4,894
Interest bearing deposits	12,816		12,106		11,589		10,697		10,570
Time deposits	3,163		2,062		2,453		2,456		2,841
Total deposits	$22,036		$19,392		$19,367		$18,072		$18,305
Spirit deposits, net of fair value adjustments	2,719
Total deposits (excluding Spirit)(1) (2)	$19,317
Linked quarter change in deposits	14	%
Linked quarter change in deposits (excluding Spirit) (1) (2)	—

^{(1) Adjusted figures exclude certain items and are non-GAAP measurements. Please see “Non-GAAP Financial Measures” below.
(2) Deposits excluding Spirit deposits are also referred to as “Legacy SFNC deposits” in this earnings release.}

Asset Quality
Total nonperforming loans at the end of the second quarter of 2022 were $63.6 million, down $0.7 million compared to $64.3 million at the end of the first quarter of 2022 and down $17.3 million compared to $80.9 million at the end of the second quarter of 2021. Total nonperforming assets as a percentage of total assets were 0.26 at the end of the second quarter of 2022, compared to 0.29 percent at the end of the first quarter of 2022 and 0.42 percent at the end of the second quarter of 2021. Net charge-offs as a percentage of average loans were 2 basis points in the second quarter of 2022, compared to 22 basis points in the first quarter of 2022 and net recoveries of 7 basis points in the second quarter of 2021.

Improving asset quality metrics reflect both economic conditions in the markets we serve, as well as the impact of the Company’s strategic decision in 2019 designed to de-risk loan portfolios that were acquired in connection with its geographic diversification and expansion. As a result of this strategic decision, over the past two years the Company has prudently and systematically exited certain non-relationship credits and non-core industries while also significantly reducing its exposure to commercial real estate to more acceptable levels.

During the second quarter of 2022, the Company recorded a provision for credit losses totaling $33.9 million, compared to provision recaptures of $19.9 million in the first quarter of 2022 and $13.0 million in the second quarter of 2021. The provision for credit losses in the second quarter of 2022 includes $33.8 million associated with Day 2 accounting provision required for loans and unfunded commitments acquired during the quarter in connection with the acquisition of Spirit.

The allowance for credit losses on loans at the end of the second quarter of 2022 was $212.6 million, compared to $178.9 million at the end of the first quarter of 2022 and $227.2 million at the end of the second quarter of 2021. Included in the allowance for credit losses in the second quarter of 2022 is the impact of the Day 2 accounting provision related to Spirit, as well as fair value purchase accounting credit marks of $4.1 million. The allowance for credit losses on loans to total loans ratio ended the quarter at 1.41 percent, compared to 1.49 percent at the end of the first quarter of 2022 and 2.00 percent at the end of the second quarter of 2021. The nonperforming loan coverage ratio ended the quarter at 334 percent, compared to 278 percent at the end of the first quarter of 2022 and 281 percent at the end of the second quarter of 2021.

$ in millions	Q2 22		Q1 22		Q4 21		Q3 21		Q2 21
Allowance for credit losses on loans to total loans	1.41	%	1.49	%	1.71	%	1.87	%	2.00	%
Allowance for credit losses on loans to nonperforming loans	334		278		300		341		281
Nonperforming loans to total loans	0.42		0.53		0.57		0.55		0.71
Net charge-off ratio (annualized)	0.02		0.22		0.31		0.17		(0.07	)
Net charge-off ratio YTD (annualized)	0.11		0.22		0.13		0.06		0.01
Total nonperforming loans	$63.6		$64.3		$68.6		$59.4		$80.9
Total other nonperforming assets	6.4		6.6		7.7		13.5		16.3
Total nonperforming assets	$70.0		$70.9		$76.3		$72.9		$97.2

Capital
Total common stockholders’ equity at the end of the second quarter of 2022 was $3.3 billion, compared to $3.0 billion at the end of both the first quarter of 2022 and second quarter of 2021. The increase in common stockholders’ equity on a linked quarter basis reflects the issuance of shares in connection with the acquisition of Spirit and earnings for the quarter, partially offset by the return of capital to shareholders through share repurchases and the payment of a cash dividend, and an increase in unrealized losses associated with investment securities classified as available-for-sale. Book value per share at the end of the second quarter of 2022 was $25.31, compared to $26.32 at the end of the first quarter of 2022 and $28.03 and the end of the second quarter of 2021. Tangible book value per share was $14.07 at the end of the second quarter of 2022, compared to $15.22 at the end of the first quarter of 2022 and $17.16 at the end of the second quarter of 2021. The ratio of stockholders’ equity to total assets at June 30, 2022, was 12.0 percent and the ratio of tangible common equity to tangible assets was 7.0 percent. All of Simmons’ regulatory capital ratios continue to significantly exceed “well-capitalized” guidelines.

	Q2 22		Q1 22		Q4 21		Q3 21		Q2 21
Stockholders’ equity to total assets	12.0	%	12.1	%	13.1	%	13.1	%	13.0	%
Tangible common equity to tangible assets (1)	7.0		7.4		8.5		8.4		8.4
Regulatory common equity tier 1 ratio	12.1		13.5		13.8		14.3		14.2
Regulatory tier 1 leverage ratio	9.2		9.0		9.1		9.1		9.0
Regulatory tier 1 risk-based capital ratio	12.1		13.5		13.8		14.3		14.2
Regulatory total risk-based capital ratio	14.8		16.4		16.8		17.4		17.5

^{(1) Tangible common equity to tangible assets is a non-GAAP measurement. Please see “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” below.}

Share Repurchase Program and Cash Dividend
As previously announced, as a result of the Simmons’ strong capital position and ability to organically generate capital, the board of directors declared a quarterly cash dividend on Simmons’ Class A common stock of $0.19 per share, which is payable on October 3, 2022, to shareholders of record as of September 15, 2022. The cash dividend rate represents an increase of $0.01 per share, or 6 percent, from the dividend paid for the same time period last year. The current quarterly cash dividend rate further represents an annualized cash dividend rate of $0.76 per share and a ten-year compound annual growth rate of 7 percent. With the payment of dividends in 2022, Simmons has paid cash dividends for 113 consecutive years. According to research performed by Dividend Power, Simmons is one of only 23 U.S. publicly traded companies that have paid dividends for 100+ uninterrupted years. Simmons was one of only two banks to be named to the list and tied for second among Nasdaq listed companies for the longest active streak.

During the second quarter of 2022, Simmons repurchased approximately 2.0 million shares of its Class A common stock at an average price of $24.57 under its 2022 stock repurchase program that was announced in January 2022 (2022 Program). Under the 2022 Program, Simmons is authorized to repurchase up to $175,000,000 of its issued and outstanding Class A common stock. Market conditions and our capital needs will drive the decisions regarding future stock repurchases, the timing, pricing and amount of any repurchases under the 2022 Program will be determined by Simmons’ management at its discretion, and the 2022 Program does not obligate Simmons to repurchase any common stock and may be modified, discontinued or suspended at any time without prior notice.

Simmons First National Corporation
Simmons First National Corporation (NASDAQ: SFNC) is a Mid-South based financial holding company that has paid cash dividends to its shareholders for 113 consecutive years. Its principal subsidiary, Simmons Bank, operates more than 230 branches in Arkansas, Kansas, Missouri, Oklahoma, Tennessee and Texas. Founded in 1903, Simmons Bank offers comprehensive financial solutions delivered with a client-centric approach. Simmons Bank was named to Forbes list of “America’s Best Banks” for the second consecutive year and was recently named to Forbes list of “World’s Best Banks” for the third consecutive year. Additional information about Simmons Bank can be found on our website at simmonsbank.com, by following @Simmons_Bank on Twitter or by visiting our newsroom.

Conference Call
Management will conduct a live conference call to review this information beginning at 9:00 a.m. Central Time today, Thursday, July 21, 2022. Interested persons can listen to this call by dialing toll-free 1-877-270-2148 (North America only) and asking for the Simmons First National Corporation conference call, conference ID 10168365. In addition, the call will be available live or in recorded version on the Company’s website at simmonsbank.com for at least 60 days.

Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (GAAP). The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance. These measures adjust GAAP performance measures to, among other things, include the tax benefit associated with revenue items that are tax-exempt, as well as exclude from net income (including on a per share diluted basis), pre-tax, pre-provision earnings, net charge-offs, income available to common shareholders, non-interest income, and non-interest expense certain income and expense items attributable to merger activity (primarily including merger-related expenses), gains and/or losses on sale of branches, early retirement programs and net branch right-sizing initiatives. In addition, the Company also presents certain figures based on tangible common stockholders’ equity, tangible assets and tangible book value, which exclude goodwill and other intangible assets. The Company further presents certain figures that are exclusive of the impact of PPP loans, deposits and/or loans acquired through the Spirit acquisition, mortgage warehouse loans, and/or energy loans. The Company’s management believes that these non-GAAP financial measures are useful to investors because they, among other things, present the results of the Company’s ongoing operations without the effect of mergers or other items not central to the Company’s ongoing business, as well as normalize for tax effects and the effects of the PPP. Management, therefore, believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s ongoing businesses, and management uses these non-GAAP financial measures to assess the performance of the Company’s ongoing businesses as related to prior financial periods. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.

Forward-Looking Statements
Certain statements in this news release may not be based on historical facts and should be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including, without limitation, statements made in Mr. Makris’s quotes, may be identified by reference to future periods or by the use of forward-looking terminology, such as “believe,” “budget,” “expect,” “foresee,” “anticipate,” “intend,” “indicate,” “target,” “estimate,” “plan,” “project,” “continue,” “contemplate,” “positions,” “prospects,” “predict,” or “potential,” by future conditional verbs such as “will,” “would,” “should,” “could,” “might” or “may,” or by variations of such words or by similar expressions. These forward-looking statements include, without limitation, statements relating to Simmons’ future growth, lending capacity and lending activity, loan demand, revenue, assets, asset quality, profitability, dividends, net interest margin, non-interest revenue, share repurchase program, acquisition strategy, digital banking initiatives, the Company’s ability to recruit and retain key employees, the adequacy of the allowance for credit losses, the ability of the Company to manage the impacts of the COVID-19 pandemic, and the impacts of the Company’s and its customers’ participation in the PPP. Any forward-looking statement speaks only as of the date of this news release, and Simmons undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release. By nature, forward-looking statements are based on various assumptions and involve inherent risk and uncertainties. Various factors, including, but not limited to, changes in economic conditions, credit quality, interest rates, loan demand, deposit flows, real estate values, the assumptions used in making the forward-looking statements, the securities markets generally or the price of Simmons’ common stock specifically, and information technology affecting the financial industry; the effect of steps the Company takes and has taken in response to the COVID-19 pandemic; the severity and duration of the COVID-19 pandemic and the heightened impact it has on many of the risks described herein; the effects of the COVID-19 pandemic on, among other things, the Company’s operations, liquidity, and credit quality; general economic and market conditions; market disruptions including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, war and other military conflicts (including the ongoing military conflict between Russia and Ukraine) or other major events, or the prospect of these events; increased competition in the markets in which the Company operates; increased unemployment; labor shortages; claims, damages, and fines related to litigation or government actions; changes in accounting principles relating to loan loss recognition (current expected credit losses); the Company’s ability to manage and successfully integrate its mergers and acquisitions and to fully realize cost savings and other benefits associated with those transactions; cyber threats, attacks or events; reliance on third parties for key services; government legislation; and other factors, many of which are beyond the control of the Company, could cause actual results to differ materially from those projected in or contemplated by the forward-looking statements. Additional information on factors that might affect the Company’s financial results is included in the Company’s Form 10-K for the year ended December 31, 2021, and other reports that the Company has filed with or furnished to the U.S. Securities and Exchange Commission (the SEC), all of which are available from the SEC on its website, www.sec.gov.

FOR MORE INFORMATION CONTACT:
Ed Bilek
EVP, Director of Investor and Media Relations
Simmons First National Corporation
ed.bilek@simmonsbank.com
205.612.3378 (cell)

Simmons First National Corporation																		SFNC
Consolidated End of Period Balance Sheets
For the Quarters Ended		Jun 30				Mar 31				Dec 31				Sep 30				Jun 30
(Unaudited)			2022				2022				2021				2021				2021
($ in thousands)
ASSETS
Cash and non-interest bearing balances due from banks		$	193,473			$	195,510			$	209,190			$	225,500			$	215,381
Interest bearing balances due from banks and federal funds sold			771,374				1,491,507				1,441,463				1,555,913				2,123,743
Cash and cash equivalents			964,847				1,687,017				1,650,653				1,781,413				2,339,124
Interest bearing balances due from banks - time			1,535				1,857				1,882				1,780				1,335
Investment securities - held-to-maturity			3,819,682				1,556,825				1,529,221				1,516,797				931,352
Investment securities - available-for-sale			4,341,647				6,640,069				7,113,545				6,822,203				6,556,581
Mortgage loans held for sale			14,437				18,206				36,356				34,628				36,011
Other loans held for sale			16,375				-				100				100				100
Loans:
Loans			15,110,344				12,028,593				12,012,503				10,825,227				11,386,352
Allowance for credit losses on loans			(212,611	)			(178,924	)			(205,332	)			(202,508	)			(227,239	)
Net loans			14,897,733				11,849,669				11,807,171				10,622,719				11,159,113
Premises and equipment			553,062				486,531				483,469				463,924				429,587
Premises held for sale			-				-				-				-				6,090
Foreclosed assets and other real estate owned			4,084				5,118				6,032				11,759				15,239
Interest receivable			82,332				69,357				72,990				68,405				67,916
Bank owned life insurance			486,355				448,011				445,305				421,762				419,198
Goodwill			1,310,528				1,147,007				1,146,007				1,075,305				1,075,305
Other intangible assets			137,285				102,748				106,235				100,428				103,759
Other assets			588,707				469,853				325,793				304,707				282,449
Total assets		$	27,218,609			$	24,482,268			$	24,724,759			$	23,225,930			$	23,423,159
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing transaction accounts		$	6,057,186			$	5,223,862			$	5,325,318			$	4,918,845			$	4,893,959
Interest bearing transaction accounts and savings deposits			12,816,198				12,105,948				11,588,770				10,697,451				10,569,602
Time deposits			3,162,479				2,062,612				2,452,460				2,455,774				2,841,052
Total deposits			22,035,863				19,392,422				19,366,548				18,072,070				18,304,613
Federal funds purchased and securities sold under agreements to repurchase			155,101				196,828				185,403				217,276				187,215
Other borrowings			1,060,244				1,337,243				1,337,973				1,338,585				1,339,193
Subordinated notes and debentures			421,693				384,242				384,131				383,278				383,143
Other liabilities held for sale			-				-				-				-				-
Accrued interest and other liabilities			285,813				209,926				201,863				184,190				169,629
Total liabilities			23,958,714				21,520,661				21,475,918				20,195,399				20,383,793
Stockholders' equity:
Preferred stock			-				-				-				767				767
Common stock			1,288				1,125				1,127				1,066				1,084
Surplus			2,569,060				2,150,453				2,164,989				1,974,561				2,021,128
Undivided profits			1,139,975				1,136,990				1,093,270				1,065,566				1,004,314
Accumulated other comprehensive (loss) income:
Unrealized (depreciation) appreciation on AFS securities			(450,428	)			(326,961	)			(10,545	)			(11,429	)			12,073
Total stockholders' equity			3,259,895				2,961,607				3,248,841				3,030,531				3,039,366
Total liabilities and stockholders' equity		$	27,218,609			$	24,482,268			$	24,724,759			$	23,225,930			$	23,423,159

Simmons First National Corporation																		SFNC
Consolidated Statements of Income - Quarter-to-Date
For the Quarters Ended		Jun 30				Mar 31				Dec 31				Sep 30				Jun 30
(Unaudited)			2022				2022				2021				2021				2021
($ in thousands, except per share data)
INTEREST INCOME
Loans (including fees)		$	163,578			$	127,176			$	137,564			$	132,216			$	138,804
Interest bearing balances due from banks and federal funds sold			1,117				649				583				763				651
Investment securities			37,848				33,712				32,275				30,717				27,128
Mortgage loans held for sale			200				190				310				230				386
Other loans held for sale			2,063				-				-				-				-
TOTAL INTEREST INCOME			204,806				161,727				170,732				163,926				166,969
INTEREST EXPENSE
Time deposits			2,875				2,503				3,705				4,747				6,061
Other deposits			6,879				4,314				4,390				4,369				4,721
Federal funds purchased and securities sold under agreements to repurchase			119				68				72				70				192
Other borrowings			4,844				4,779				4,903				4,893				4,897
Subordinated notes and debentures			4,990				4,457				4,581				4,610				4,565
TOTAL INTEREST EXPENSE			19,707				16,121				17,651				18,689				20,436
NET INTEREST INCOME			185,099				145,606				153,081				145,237				146,533
Provision for credit losses			33,859				(19,914	)			(1,308	)			(19,890	)			(12,951	)
NET INTEREST INCOME AFTER PROVISION
FOR CREDIT LOSSES			151,240				165,520				154,389				165,127				159,484
NON-INTEREST INCOME
Wealth management fees			7,214				7,968				8,042				7,877				7,892
Service charges on deposit accounts			11,379				10,696				11,909				11,557				10,050
Other service charges and fees			1,871				1,637				1,762				1,964				2,048
Mortgage lending income			2,240				4,550				5,043				5,818				4,490
Debit and credit card fees			8,224				7,449				7,460				7,102				7,073
Bank owned life insurance income			2,563				2,706				2,768				2,573				2,038
(Loss) gain on sale of securities, net			(150	)			(54	)			(348	)			5,248				5,127
Other income			6,837				7,266				9,965				6,411				8,397
TOTAL NON-INTEREST INCOME			40,178				42,218				46,601				48,550				47,115
NON-INTEREST EXPENSE
Salaries and employee benefits			74,135				67,906				63,832				61,902				60,261
Occupancy expense, net			11,004				10,023				11,033				9,361				9,103
Furniture and equipment expense			5,104				4,775				4,721				4,895				4,859
Other real estate and foreclosure expense			142				343				576				339				863
Deposit insurance			2,812				1,838				2,108				1,870				1,687
Merger-related costs			19,133				1,886				13,591				1,401				686
Other operating expenses			44,483				41,646				45,736				34,565				37,198
TOTAL NON-INTEREST EXPENSE			156,813				128,417				141,597				114,333				114,657
NET INCOME BEFORE INCOME TAXES			34,605				79,321				59,393				99,344				91,942
Provision for income taxes			7,151				14,226				11,155				18,770				17,018
NET INCOME			27,454				65,095				48,238				80,574				74,924
Preferred stock dividends			-				-				8				13				13
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS		$	27,454			$	65,095			$	48,230			$	80,561			$	74,911
BASIC EARNINGS PER SHARE		$	0.21			$	0.58			$	0.42			$	0.75			$	0.69
DILUTED EARNINGS PER SHARE		$	0.21			$	0.58			$	0.42			$	0.74			$	0.69

Simmons First National Corporation																		SFNC
Consolidated Risk-Based Capital
For the Quarters Ended		Jun 30				Mar 31				Dec 31				Sep 30				Jun 30
(Unaudited)			2022				2022				2021				2021				2021
($ in thousands)
Tier 1 capital
Stockholders' equity		$	3,259,895			$	2,961,607			$	3,248,841			$	3,030,531			$	3,039,366
CECL transition provision (1)			92,619				92,619				114,458				122,787				128,933
Disallowed intangible assets, net of deferred tax			(1,423,323	)			(1,224,691	)			(1,226,686	)			(1,152,688	)			(1,156,203	)
Unrealized loss (gain) on AFS securities			450,428				326,961				10,545				11,429				(12,073	)
Total Tier 1 capital			2,379,619				2,156,496				2,147,158				2,012,059				2,000,023
Tier 2 capital
Subordinated notes and debentures			421,693				384,242				384,131				383,278				383,143
Qualifying allowance for loan losses and reserve for unfunded commitments			114,733				78,057				71,853				60,700				79,138
Total Tier 2 capital			536,426				462,299				455,984				443,978				462,281
Total risk-based capital		$	2,916,045			$	2,618,795			$	2,603,142			$	2,456,037			$	2,462,304
Risk weighted assets		$	19,669,149			$	15,953,622			$	15,538,967			$	14,098,320			$	14,076,975
Adjusted average assets for leverage ratio		$	25,807,113			$	23,966,206			$	23,647,901			$	22,189,921			$	22,244,118
Ratios at end of quarter
Equity to assets			11.98	%			12.10	%			13.14	%			13.05	%			12.98	%
Tangible common equity to tangible assets (2)			7.03	%			7.37	%			8.51	%			8.41	%			8.36	%
Common equity Tier 1 ratio (CET1)			12.10	%			13.52	%			13.82	%			14.27	%			14.20	%
Tier 1 leverage ratio			9.22	%			9.00	%			9.08	%			9.07	%			8.99	%
Tier 1 risk-based capital ratio			12.10	%			13.52	%			13.82	%			14.27	%			14.21	%
Total risk-based capital ratio			14.83	%			16.42	%			16.75	%			17.42	%			17.49	%
(1) The Company has elected to use the CECL transition provision allowed for in the year of adopting ASC 326.
(2) Calculations of tangible common equity to tangible assets and the reconciliations to GAAP are included in the schedules accompanying this release.

Simmons First National Corporation																		SFNC
Consolidated Investment Securities
For the Quarters Ended		Jun 30				Mar 31				Dec 31				Sep 30				Jun 30
(Unaudited)			2022				2022				2021				2021				2021
($ in thousands)
Investment Securities - End of Period
Held-to-Maturity
U.S. Government agencies		$	446,789			$	232,670			$	232,609			$	232,549			$	77,396
Mortgage-backed securities			1,244,713				112,496				70,342				57,930				60,649
State and political subdivisions			1,868,924				1,194,459				1,209,051				1,209,091				793,307
Other securities			259,256				17,200				17,219				17,227				-
Total held-to-maturity (net of credit losses)			3,819,682				1,556,825				1,529,221				1,516,797				931,352
Available-for-Sale
U.S. Treasury		$	1,441			$	-			$	300			$	300			$	600
U.S. Government agencies			198,333				333,231				364,641				354,382				554,937
Mortgage-backed securities			2,963,934				4,166,108				4,448,616				4,421,620				3,987,209
State and political subdivisions			915,255				1,653,694				1,819,658				1,575,208				1,557,497
Other securities			262,684				487,036				480,330				470,693				456,338
Total available-for-sale (net of credit losses)			4,341,647				6,640,069				7,113,545				6,822,203				6,556,581
Total investment securities (net of credit losses)		$	8,161,329			$	8,196,894			$	8,642,766			$	8,339,000			$	7,487,933
Fair value - HTM investment securities		$	3,278,982			$	1,307,058			$	1,517,378			$	1,487,916			$	935,596
Investment Securities - QTD Average
Taxable securities		$	5,674,470			$	5,688,306			$	5,790,429			$	5,475,932			$	4,265,545
Tax exempt securities			2,725,610				2,844,777				2,787,301				2,496,958				2,157,076
Total investment securities - QTD average		$	8,400,080			$	8,533,083			$	8,577,730			$	7,972,890			$	6,422,621

Simmons First National Corporation																		SFNC
Consolidated Loans
For the Quarters Ended		Jun 30				Mar 31				Dec 31				Sep 30				Jun 30
(Unaudited)			2022				2022				2021				2021				2021
($ in thousands)
Loan Portfolio - End of Period
Consumer
Credit cards		$	189,684			$	184,372			$	187,052			$	175,884			$	177,634
Other consumer			204,692				180,602				168,318				182,492				181,712
Total consumer			394,376				364,974				355,370				358,376				359,346
Real Estate
Construction			2,082,688				1,423,445				1,326,371				1,229,740				1,428,165
Single-family residential			2,357,942				2,042,978				2,101,975				1,540,701				1,608,028
Other commercial real estate			7,082,055				5,762,567				5,738,904				5,308,902				5,332,655
Total real estate			11,522,685				9,228,990				9,167,250				8,079,343				8,368,848
Commercial
Commercial			2,612,256				2,016,405				1,992,043				1,821,905				2,074,729
Agricultural			218,743				150,465				168,717				216,735				193,462
Total commercial			2,830,999				2,166,870				2,160,760				2,038,640				2,268,191
Other			362,284				267,759				329,123				348,868				389,967
Total loans		$	15,110,344			$	12,028,593			$	12,012,503			$	10,825,227			$	11,386,352

Simmons First National Corporation																		SFNC
Consolidated Allowance and Asset Quality
For the Quarters Ended		Jun 30				Mar 31				Dec 31				Sep 30				Jun 30
(Unaudited)			2022				2022				2021				2021				2021
($ in thousands)
Allowance for Credit Losses on Loans
Beginning balance		$	178,924			$	205,332			$	202,508			$	227,239			$	235,116
Day 1 PCD allowance from acquisitions
Landmark (10/08/2021)			-								2,359
Triumph (10/08/2021)			-								11,092
Spirit of Texas (01/08/2022)			4,043								-
Total Day 1 PCD allowance			4,043								13,451
Loans charged off
Credit cards			1,004				920				865				711				1,046
Other consumer			518				414				477				463				411
Real estate			115				485				2,624				5,941				439
Commercial			688				6,319				8,513				932				309
Total loans charged off			2,325				8,138				12,479				8,047				2,205
Recoveries of loans previously charged off
Credit cards			249				274				247				267				244
Other consumer			302				387				267				408				425
Real estate			391				426				916				2,068				1,523
Commercial			621				557				1,730				463				2,147
Total recoveries			1,563				1,644				3,160				3,206				4,339
Net loans charged off			762				6,494				9,319				4,841				(2,134	)
Provision for credit losses on loans			30,406				(19,914	)			(1,308	)			(19,890	)			(10,011	)
Balance, end of quarter		$	212,611			$	178,924			$	205,332			$	202,508			$	227,239
Non-performing assets
Non-performing loans
Nonaccrual loans		$	62,670			$	64,096			$	68,204			$	59,054			$	80,282
Loans past due 90 days or more			904				240				349				334				653
Total non-performing loans			63,574				64,336				68,553				59,388				80,935
Other non-performing assets
Foreclosed assets and other real estate owned			4,084				5,118				6,032				11,759				15,239
Other non-performing assets			2,314				1,479				1,667				1,724				1,062
Total other non-performing assets			6,398				6,597				7,699				13,483				16,301
Total non-performing assets		$	69,972			$	70,933			$	76,252			$	72,871			$	97,236
Performing TDRs (troubled debt restructurings)		$	2,655			$	3,424			$	4,289			$	4,251			$	4,436
Ratios
Allowance for credit losses on loans to total loans			1.41	%			1.49	%			1.71	%			1.87	%			2.00	%
Allowance for credit losses to non-performing loans			334	%			278	%			300	%			341	%			281	%
Non-performing loans to total loans			0.42	%			0.53	%			0.57	%			0.55	%			0.71	%
Non-performing assets (including performing TDRs) to total assets			0.27	%			0.30	%			0.33	%			0.33	%			0.43	%
Non-performing assets to total assets			0.26	%			0.29	%			0.31	%			0.31	%			0.42	%
Annualized net charge offs to total loans			0.02	%			0.22	%			0.31	%			0.17	%			-0.07	%
Annualized net credit card charge offs to total credit card loans			1.55	%			1.39	%			1.29	%			0.96	%			1.78	%

 

Simmons First National Corporation																										SFNC
Consolidated - Average Balance Sheet and Net Interest Income Analysis
For the Quarters Ended
(Unaudited)
		Three Months Ended Jun 2022									Three Months Ended Mar 2022									Three Months Ended Jun 2021
($ in thousands)		Average Balance			Income/ Expense			Yield/ Rate			Average Balance			Income/ Expense			Yield/ Rate			Average Balance			Income/ Expense			Yield/ Rate
ASSETS
Earning assets:
Interest bearing balances due from banks and federal funds sold		$	777,098		$	1,117		0.58	%		$	1,728,694		$	649		0.15	%		$	2,703,920		$	651		0.10	%
Investment securities - taxable			5,674,470			21,794		1.54	%			5,688,306			18,148		1.29	%			4,265,545			14,594		1.37	%
Investment securities - non-taxable (FTE)			2,725,610			21,733		3.20	%			2,844,777			20,937		2.98	%			2,157,076			16,899		3.14	%
Mortgage loans held for sale			17,173			200		4.67	%			27,633			190		2.79	%			49,262			386		3.14	%
Other loans held for sale			22,114			2,063		37.42	%			-			-		0.00	%			-			-		0.00	%
Loans - including fees (FTE)			14,478,183			163,995		4.54	%			11,895,805			127,405		4.34	%			11,783,839			138,987		4.73	%
Total interest earning assets (FTE)			23,694,648			210,902		3.57	%			22,185,215			167,329		3.06	%			20,959,642			171,517		3.28	%
Non-earning assets			3,074,384									2,640,984									2,298,279
Total assets		$	26,769,032								$	24,826,199								$	23,257,921
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest bearing liabilities:
Interest bearing transaction and savings accounts		$	12,807,502		$	6,879		0.22	%		$	12,083,516		$	4,314		0.14	%		$	10,403,932		$	4,721		0.18	%
Time deposits			2,586,567			2,875		0.45	%			2,241,123			2,503		0.45	%			2,930,025			6,061		0.83	%
Total interest bearing deposits			15,394,069			9,754		0.25	%			14,324,639			6,817		0.19	%			13,333,957			10,782		0.32	%
Federal funds purchased and securities sold under agreement to repurchase			210,280			119		0.23	%			218,186			68		0.13	%			240,876			192		0.32	%
Other borrowings			1,241,501			4,844		1.56	%			1,337,654			4,779		1.45	%			1,340,008			4,897		1.47	%
Subordinated notes and debentures			418,327			4,990		4.78	%			384,187			4,457		4.70	%			383,078			4,565		4.78	%
Total interest bearing liabilities			17,264,177			19,707		0.46	%			16,264,666			16,121		0.40	%			15,297,919			20,436		0.54	%
Non-interest bearing liabilities:
Non-interest bearing deposits			5,926,304									5,184,828									4,826,927
Other liabilities			216,848									207,597									151,699
Total liabilities			23,407,329									21,657,091									20,276,545
Stockholders' equity			3,361,703									3,169,108									2,981,376
Total liabilities and stockholders' equity		$	26,769,032								$	24,826,199								$	23,257,921
Net interest income (FTE)					$	191,195								$	151,208								$	151,081
Net interest spread (FTE)								3.11	%								2.66	%								2.74	%
Net interest margin (FTE) - quarter-to-date								3.24	%								2.76	%								2.89	%
Net interest margin (FTE) - year-to-date								3.01	%								2.76	%								2.94	%

Simmons First National Corporation													SFNC
Consolidated - Selected Financial Data
For the Quarters Ended	Jun 30			Mar 31			Dec 31			Sep 30			Jun 30
(Unaudited)	2022			2022			2021			2021			2021
($ in thousands, except share data)
QUARTER-TO-DATE
Financial Highlights - GAAP
Net Income	$	27,454		$	65,095		$	48,230		$	80,561		$	74,911
Diluted earnings per share	0.21			0.58			0.42			0.74			0.69
Return on average assets	0.41		%	1.06		%	0.77		%	1.37		%	1.29		%
Return on average common equity	3.28		%	8.33		%	5.87		%	10.42		%	10.08		%
Return on tangible common equity	6.28		%	14.31		%	9.98		%	17.43		%	17.25		%
Net interest margin (FTE)	3.24		%	2.76		%	2.86		%	2.85		%	2.89		%
FTE adjustment	6,096			5,602			5,579			4,941			4,548
Average diluted shares outstanding	128,720,078			113,026,911			114,491,119			108,359,890			108,822,175
Shares repurchased under plan	2,035,324			513,725			2,625,348			1,806,205			-
Average price of shares repurchased	24.57			31.25			29.69			28.48			-
Cash dividends declared per common share	0.19			0.19			0.18			0.18			0.18
Accretable yield on acquired loans	9,898			3,703			5,758			4,122			5,619
Efficiency ratio (non-GAAP)(1)	57.49		%	62.95		%	59.48		%	58.10		%	56.75		%
END OF PERIOD
Book value per share	$	25.31		$	26.32		$	28.82		$	28.42		$	28.03
Tangible book value per share	14.07			15.22			17.71			17.39			17.16
Shares outstanding	128,787,764			112,505,555			112,715,444			106,603,231			108,386,669
Full-time equivalent employees	3,233			2,893			2,877			2,740			2,783
Total number of financial centers	233			197			199			185			198
(1) Efficiency ratio is adjusted non-interest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and non-interest revenues, excluding gains and losses from securities transactions and certain adjusting items, and is a non-GAAP measurement.

Simmons First National Corporation													SFNC
Reconciliation Of Non-GAAP Financial Measures - Adjusted Earnings - Quarter-to-Date
For the Quarters Ended	Jun 30			Mar 31			Dec 31			Sep 30			Jun 30
(Unaudited)	2022			2022			2021			2021			2021
($ in thousands, except per share data)
QUARTER-TO-DATE
Net Income	$	27,454		$	65,095		$	48,230		$	80,561		$	74,911
Certain items
Gain on sale of branches	-			-			-			-			(16		)
Merger-related costs	19,133			1,886			13,591			1,401			686
Branch right-sizing (net)	380			909			1,648			(3,041		)	39
Day 2 CECL provision	33,779			-			22,688			-
Tax effect(1)	(13,928		)	(731		)	(9,912		)	429			(185		)
Certain items, net of tax	39,364			2,064			28,015			(1,211		)	524
Adjusted earnings (non-GAAP)	$	66,818		$	67,159		$	76,245		$	79,350		$	75,435
Diluted earnings per share	$	0.21		$	0.58		$	0.42		$	0.74		$	0.69
Certain items
Gain on sale of branches	-			-			-			-			-
Merger-related costs	0.15			0.01			0.12			0.01			0.01
Branch right-sizing (net)	-			0.01			0.01			(0.03		)	-
Day 2 CECL provision	0.27						0.20
Tax effect(1)	(0.11		)	(0.01		)	(0.09		)	0.01			(0.01		)
Certain items, net of tax	0.31			0.01			0.24			(0.01		)	-
Adjusted diluted earnings per share (non-GAAP)	$	0.52		$	0.59		$	0.66		$	0.73		$	0.69
(1) Effective tax rate of 26.135%.
Reconciliation of Certain Adjusting Non-Interest Income and Expense Items (non-GAAP)
QUARTER-TO-DATE
Other income	$	6,837		$	7,266		$	9,965		$	6,411		$	8,397
Adjusting items(1)	88			-			(2		)	239			(445		)
Adjusted other income (non-GAAP)	$	6,925		$	7,266		$	9,963		$	6,650		$	7,952
Non-interest expense	$	156,813		$	128,417		$	141,597		$	114,333		$	114,657
Adjusting items(1)	(19,425		)	(2,795		)	(15,241		)	1,879			(1,154		)
Adjusted non-interest expense (non-GAAP)	$	137,388		$	125,622		$	126,356		$	116,212		$	113,503
Salaries and employee benefits	$	74,135		$	67,906		$	63,832		$	61,902		$	60,261
Adjusting items(1)	-			-			-			(66		)	-
Adjusted salaries and employee benefits (non-GAAP)	$	74,135		$	67,906		$	63,832		$	61,836		$	60,261
Other operating expenses	$	44,483		$	41,646		$	45,736		$	34,565		$	37,198
Adjusting items(1)	(7		)	(717		)	96			3,759			(89		)
Adjusted other operating expenses (non-GAAP)	$	44,476		$	40,929		$	45,832		$	38,324		$	37,109
(1) Adjusting items include gain on sale of branches, merger related costs and branch right-sizing costs.

Simmons First National Corporation													SFNC
Reconciliation Of Non-GAAP Financial Measures - End of Period
For the Quarters Ended	Jun 30			Mar 31			Dec 31			Sep 30			Jun 30
(Unaudited)	2022			2022			2021			2021			2021
($ in thousands, except per share data)
Calculation of Tangible Common Equity and the Ratio of Tangible Common Equity to Tangible Assets
Total common stockholders' equity	$	3,259,895		$	2,961,607		$	3,248,841		$	3,029,764		$	3,038,599
Intangible assets:
Goodwill	(1,310,528		)	(1,147,007		)	(1,146,007		)	(1,075,305		)	(1,075,305		)
Other intangible assets	(137,285		)	(102,748		)	(106,235		)	(100,428		)	(103,759		)
Total intangibles	(1,447,813		)	(1,249,755		)	(1,252,242		)	(1,175,733		)	(1,179,064		)
Tangible common stockholders' equity	$	1,812,082		$	1,711,852		$	1,996,599		$	1,854,031		$	1,859,535
Total assets	$	27,218,609		$	24,482,268		$	24,724,759		$	23,225,930		$	23,423,159
Intangible assets:
Goodwill	(1,310,528		)	(1,147,007		)	(1,146,007		)	(1,075,305		)	(1,075,305		)
Other intangible assets	(137,285		)	(102,748		)	(106,235		)	(100,428		)	(103,759		)
Total intangibles	(1,447,813		)	(1,249,755		)	(1,252,242		)	(1,175,733		)	(1,179,064		)
Tangible assets	$	25,770,796		$	23,232,513		$	23,472,517		$	22,050,197		$	22,244,095
Paycheck protection program ("PPP") loans	(19,476		)	(61,887		)	(116,659		)	(212,087		)	(441,353		)
Total assets excluding PPP loans	$	27,199,133		$	24,420,381		$	24,608,100		$	23,013,843		$	22,981,806
Tangible assets excluding PPP loans	$	25,751,320		$	23,170,626		$	23,355,858		$	21,838,110		$	21,802,742
Ratio of common equity to assets	11.98		%	12.10		%	13.14		%	13.04		%	12.97		%
Ratio of common equity to assets excluding PPP loans	11.99		%	12.13		%	13.20		%	13.16		%	13.22		%
Ratio of tangible common equity to tangible assets	7.03		%	7.37		%	8.51		%	8.41		%	8.36		%
Ratio of tangible common equity to tangible assets excluding PPP loans	7.04		%	7.39		%	8.55		%	8.49		%	8.53		%
Calculation of Tangible Book Value per Share
Total common stockholders' equity	$	3,259,895		$	2,961,607		$	3,248,841		$	3,029,764		$	3,038,599
Intangible assets:
Goodwill	(1,310,528		)	(1,147,007		)	(1,146,007		)	(1,075,305		)	(1,075,305		)
Other intangible assets	(137,285		)	(102,748		)	(106,235		)	(100,428		)	(103,759		)
Total intangibles	(1,447,813		)	(1,249,755		)	(1,252,242		)	(1,175,733		)	(1,179,064		)
Tangible common stockholders' equity	$	1,812,082		$	1,711,852		$	1,996,599		$	1,854,031		$	1,859,535
Shares of common stock outstanding	128,787,764			112,505,555			112,715,444			106,603,231			108,386,669
Book value per common share	$	25.31		$	26.32		$	28.82		$	28.42		$	28.03
Tangible book value per common share	$	14.07		$	15.22		$	17.71		$	17.39		$	17.16

Simmons First National Corporation													SFNC
Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date
For the Quarters Ended	Jun 30			Mar 31			Dec 31			Sep 30			Jun 30
(Unaudited)	2022			2022			2021			2021			2021
($ in thousands)
Calculation of Efficiency Ratio(1)
Non-interest expense	$	156,813		$	128,417		$	141,597		$	114,333		$	114,657
Non-interest expense adjustment	(19,425		)	(2,795		)	(15,241		)	1,879			(1,154		)
Other real estate and foreclosure expense adjustment	(142		)	(343		)	(576		)	(339		)	(863		)
Amortization of intangibles adjustment	(4,096		)	(3,486		)	(3,486		)	(3,331		)	(3,333		)
Efficiency ratio numerator	$	133,150		$	121,793		$	122,294		$	112,542		$	109,307
Net-interest income	$	185,099		$	145,606		$	153,081		$	145,237		$	146,533
Non-interest income	40,178			42,218			46,601			48,550			47,115
Non-interest income adjustment	88			-			(2		)	239			(445		)
Fully tax-equivalent adjustment (effective tax rate of 26.135%)	6,096			5,602			5,579			4,941			4,548
Loss (gain) on sale of securities	150			54			348			(5,248		)	(5,127		)
Efficiency ratio denominator	$	231,611		$	193,480		$	205,607		$	193,719		$	192,624
Efficiency ratio(1)	57.49		%	62.95		%	59.48		%	58.10		%	56.75		%
(1) Efficiency ratio is adjusted non-interest expense before foreclosed property expense and amortization of intangibles as a percent of net interest income (fully taxable equivalent) and non-interest revenues, excluding gains and losses from securities transactions and certain adjusting items, and is a non-GAAP measurement.

Simmons First National Corporation													SFNC
Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date (continued)
For the Quarters Ended	Jun 30			Mar 31			Dec 31			Sep 30			Jun 30
(Unaudited)	2022			2022			2021			2021			2021
($ in thousands)
Calculation of Adjusted Net Interest Margin
Net interest income	$	185,099		$	145,606		$	153,081		$	145,237		$	146,533
Fully tax-equivalent adjustment (effective tax rate of 26.135%)	6,096			5,602			5,579			4,941			4,548
Fully tax-equivalent net interest income	191,195			151,208			158,660			150,178			151,081
PPP loan interest income	(1,648		)	$	(2,113	)	$	(5,107	)	$	(9,614	)	$	(8,958	)
Net interest income adjusted for PPP loans	$	189,547		$	149,095		$	153,553		$	140,564		$	142,123
Average earning assets	$	23,694,648		$	22,185,215		$	22,029,792		$	20,901,992		$	20,959,642
Average PPP loan balance	(43,329		)	(89,757		)	(172,130		)	(359,828		)	(707,296		)
Average earning assets adjusted for PPP loans	$	23,651,319		$	22,095,458		$	21,857,662		$	20,542,164		$	20,252,346
Net interest margin	3.24		%	2.76		%	2.86		%	2.85		%	2.89		%
Net interest margin adjusted for PPP loans	3.21		%	2.74		%	2.79		%	2.71		%	2.81		%
Calculation of Pre-Provision Net Revenue (PPNR)
Net interest income	$	185,099		$	145,606		$	153,081		$	145,237		$	146,533
Non-interest income	40,178			42,218			46,601			48,550			47,115
Less: Gain (loss) on sale of securities	(150		)	(54		)	(348		)	5,248			5,127
Less: Non-interest expense	156,813			128,417			141,597			114,333			114,657
Pre-Provision Net Revenue (PPNR)	$	68,614		$	59,461		$	58,433		$	74,206		$	73,864
Calculation of Adjusted Pre-Provision Net Revenue
Pre-Provision Net Revenue (PPNR)	$	68,614		$	59,461		$	58,433		$	74,206		$	73,864
Less: Gain on sale of branches	-			-			-			-			(16		)
Plus: Merger related costs	19,133			1,886			13,591			1,401			686
Plus: Branch right sizing costs	380			909			1,648			(3,041		)	39
Adjusted Pre-Provision Net Revenue	$	88,127		$	62,256		$	73,672		$	72,566		$	74,573

FAQ

What were Simmons First National Corporation's earnings for Q2 2022?

The company reported a net income of $27.5 million for Q2 2022.

How did the acquisition of Spirit of Texas Bancshares impact SFNC's financial results?

The acquisition incurred merger-related costs of $19.1 million, affecting net income.

What is the diluted EPS for SFNC in the second quarter of 2022?

The diluted EPS for Q2 2022 was $0.21.

How much did total loans increase for SFNC in Q2 2022?

Total loans increased by 26% to $15.1 billion for Q2 2022.

What was the net interest margin for Simmons First National Corporation in Q2 2022?

The net interest margin expanded to 3.24% in Q2 2022.