Stock Yards Bancorp Reports Record Third Quarter Earnings of $17.2 Million or $0.76 Per Diluted Share

Stock Yards Bancorp, Inc. (NASDAQ: SYBT), parent company of Stock Yards Bank & Trust Company, with offices in the Louisville, Indianapolis and Cincinnati metropolitan markets, today reported record results for both the third quarter and nine months ended September 30, 2019. Total revenue, comprised of net interest income and non-interest income, increased 14% to $45.4 million for the third quarter of 2019 from $39.9 million for the third quarter of 2018. Notwithstanding several non-recurring income items recognized in the quarter, the company still posted record results. Net income for the third quarter of 2019 rose 24% to $17.2 million or $0.76 per diluted share from $13.9 million or $0.60 per diluted share for the third quarter of 2018.

 

 

 

 

(dollar amounts in thousands, except per share data)

3Q19

2Q19

3Q18

Net interest income

$

32,070

 

$

30,774

 

$

28,521

 

Provision for loan and lease losses

 

400

 

–

 

 

735

 

Non-interest income

 

13,304

 

 

12,263

 

 

11,426

 

Non-interest expenses

 

23,957

 

 

25,464

 

 

21,781

 

Income before income tax expense

 

21,017

 

 

17,573

 

 

17,431

 

Income tax expense

 

3,783

 

 

1,030

 

 

3,555

 

Net income

$

17,234

 

$

16,543

 

$

13,876

 

Net income per share, diluted

$

0.76

 

$

0.72

 

$

0.60

 

Net interest margin

 

3.86

%

 

3.81

%

 

3.79

%

Efficiency ratio

 

52.73

%

 

59.09

%

 

54.43

%

Tangible common equity to tangible assets ⁽¹⁾

 

10.83

%

 

10.85

%

 

10.57

%

Annualized return on average equity

 

17.41

%

 

17.40

%

 

15.67

%

Annualized return on average assets

 

1.95

%

 

1.93

%

 

1.75

%

 

 

 

 

 

   

Key factors affecting the Company’s results for the third quarter of 2019 included:

• Average loans increased $260 million year over year, contributing to the 12% increase in net interest income on a comparable quarter basis.
• Legacy (excluding the King Southern Bank (“KSB”) acquisition) average loans increased $104 million or 4% year over year.
• Strong net loan growth of $93 million for the third quarter of 2019, building upon a strong second quarter of 2019.
• Continued robust loan production set a year to date record, with loan payoffs/pay-downs trending lower in the second half of 2019.
• Net interest margin increased seven basis points to 3.86% from the same period last year and increased five basis points on a sequential quarterly basis. As the Federal Reserve Bank (FRB) lowered rates twice during the third quarter, the Company followed suit by lowering stated rates on most types of interest-bearing deposit and certificates of deposit account types, offsetting the decline in loan rates. Loan yields were also boosted during the quarter by a higher than normal level of fee income. Continued lowering of short term rates by the FRB and yield-curve inversion will place pressure on net interest margin. It is likely that future rate drops will not be fully offset through further deposit rate declines.
• Continued strong growth in non-interest income, led by a 7% increase in wealth management and trust (WM&T) services income, as well as a 19% increase in debit and credit card income.
• Card income and treasury management fees, bolstered by increased volume and usage, continued to stand out as diversifying non-interest revenue streams, representing a combined 25% of total non-interest income.
• Sustained strong credit quality metrics continued to result in low provisioning, with the Company recording a $400 thousand provision for loan and lease losses in the third quarter.
• The Company’s Mt. Washington branch opened during the quarter and has exceeded expectations. It represents a natural extension of the Company’s existing Bullitt County franchise and complements the recent expansion into Nelson County via the KSB acquisition.
• Non-recurring items boosted Bank Owned Life Insurance (BOLI) income and other non-interest income during the quarter.

“Stock Yards Bancorp closed out a great third quarter, setting records in net income, loan production and returns on average assets and equity,” said Chief Executive Officer James A. (Ja) Hillebrand. “Exceptional loan production and strong net loan growth drove a $3.5 million or 12% net interest income increase compared with the third quarter of 2018. Loan growth has continued to accelerate through 2019, as we have focused heavily on growing and expanding customer relationships in addition to integrating our new KSB customer base. Our loan portfolio increased $93 million this quarter due to the hard work of our entire lending team. Prudent deposit rate management also contributed to a steady net interest margin. Our credit quality metrics remain at sound levels and are some of the highest relative to our peers. Our core deposit growth is strong, further highlighting our optimism for the future. We ended the third quarter with a solid loan pipeline, positioning the Company for continued strength in loan production heading into the final quarter of the year.

“Non-interest income increased 16% and continues to demonstrate stable and diversified revenue streams. The WM&T group, with assets under management rising to over $3 billion, continued to be a leading source of fee income, with revenues increasing 7% versus the year-earlier period and contributing 43% of total non-interest income in the third quarter of 2019. Debit/credit card income and treasury management fees combined grew 16% to account for 25% of third quarter 2019 total non-interest income. We are also pleased to note the on-going contribution of mortgage banking income, which grew a healthy 17%. These diverse revenue sources remain key to the long-term stability in our growth and demonstrate our sound business model.

“While the competitive landscape is intense, we remain optimistic based on our loan pipeline and core deposit base growth and we continue to deliver market share gains. We are excited about the opportunities in the markets we serve to continue the Company’s legacy of growth and performance. As evidenced by the second quarter authorization of a share repurchase plan, our Board of Directors shares our enthusiasm about the Company’s future. I am pleased to announce that through the end of the third quarter, we have repurchased approximately 259 thousand shares of stock at a weighted average cost of $35.46 per share. Approximately 741 thousand shares remain available for repurchase under the current buy-back plan.”

In closing, Hillebrand said, “The outstanding results for the third quarter reflect solid execution of our strategic plan by our dedicated team of professionals. I am pleased to note that we were named to the 2019 Bank and Thrift SM-ALL STARS by Sandler O’Neill & Partners during the quarter, one of only 30 institutions to receive this honor based on our continued growth, profitability, credit quality and capital strength. We are honored to be recognized and are confident in our ability to continue to deliver value to our shareholders.”

Third Quarter 2019 Compared with Third Quarter 2018

Net interest income – the Company’s largest source of revenue – increased approximately $3.5 million or 12% to $32.1 million. Legacy net interest income increased $2.1 million or 7%.

• Net interest margin increased seven basis points to 3.86% from 3.79%, primarily due to a decline in deposit rates, which more than offset the decline in loan rates during the quarter, as the FRB cut rates twice. Rates on loans and thus earning assets were boosted by a higher than normal level of loan fees during the quarter.
• Total interest income rose $5.0 million or 15% to $38.0 million driven by an increase in interest income on loans consistent with growth in the portfolio. Excluding the KSB contribution, interest income on loans exceeded the prior year by $2.6 million or 9%.
• Interest expense increased $1.4 million or 31% over the prior year quarter due to a higher volume of interest bearing deposits, with approximately $394 thousand of the increase related to the KSB deposit portfolio, which was concentrated in time deposits.

Non-interest income increased $1.9 million or 16% to $13.3 million.

• WM&T income increased $358 thousand or 7% due to increased new business generation, continued strong market performance and growth in corporate retirement plans. WM&T continues to represent a steady source of growth in non-interest income for the Company.
• Debit and credit card income and treasury management fees both showed continued double digit growth, accounting for approximately 25% of total non-interest income during the quarter.
• Mortgage banking revenue increased 17% over the prior year period primarily as a result of the decline in long-term rates during the third quarter.
• BOLI income increased $301 thousand during the quarter, reflecting the receipt of life insurance proceeds during the quarter.
• Other non-interest income increased $723 thousand in large part due to interest rate swap fees on loans recognized during the quarter totaling $374 thousand. Other income was also impacted by a gain of $212 thousand on the sale of Visa Class B stock and life insurance proceeds recognized outside our normal BOLI program of $142 thousand.

Non-interest expenses increased $2.2 million or 10% to $24.0 million.

• Excluding ongoing KSB expenses, non-interest expenses would have increased $1.6 million or 7%.
• Compensation expense for the third quarter of 2019 increased $723 thousand or 6% compared with the prior-year quarter related to an overall increase in headcount, led by the Company’s efforts to add loan production talent to support strategic growth initiatives in addition to the KSB acquisition.
• Employee benefits rose $407 thousand or 16% due to elevated medical claims, increased 401(k) matching expense and increased FICA expense consistent with compensation growth.
• Net occupancy and equipment expenses increased $285 thousand or 15% due to the addition of the Mt. Washington and KSB branches.
• Technology and communication expenses increased $246 thousand or 15%, as the Company added new hardware and software to support capacity and capabilities for customers.
• The Company recorded no FDIC insurance expense during the quarter as the target national FDIC Reserve Ratio was reached during the period and credits were issued to qualifying institutions.

September 30, 2019 Compared with September 30, 2018

Total loans increased $322 million or 13% to $2.9 billion.

• Approximately $152 million of the growth in loans was a direct result of the KSB acquisition.
• Excluding the KSB acquisition, the loan portfolio grew by a net $170 million or 7%, bolstered by record loan production over the previous 12 months.

Total deposits increased $348 million or 13% to $2.9 billion.

• Approximately $99 million in deposit growth during this period was due to the KSB acquisition.
• Growth in deposits was led by a solid increase in non-interest bearing deposits, interest bearing demand deposits and time deposits.
• Core deposits, which exclude brokered deposits and time deposits greater than $250 thousand, represented 97% of total deposits.

Asset quality, which has remained exceptional and has trended within a narrow range over the past several years, remained sound. While the Company is pleased with this performance, management recognizes the cyclical nature of the economy and believes asset quality metrics will normalize over the long term, which will eventually result in higher provisioning for loan and lease losses.

• Non-performing loans (NPLs) were $3.2 million or 0.11% of total loans outstanding versus $5.0 million or 0.20% of total loans outstanding a year ago.
• Non-performing assets (NPAs), which include NPLs along with other real estate owned and repossessed assets, totaled $3.8 million or 0.11% of total assets versus $6.6 million or 0.20% of total assets.
• The allowance for loan and lease losses relative to total end-of-period loans was 0.94%, down slightly from 2018 levels.

The Company remained “well capitalized” – the highest capital rating for financial institutions.

• Total equity to assets was 11.21% and the tangible common equity ratio was 10.83%,⁽¹⁾ compared to 10.62% and 10.57%, respectively, with the fluctuation primarily associated with record earnings slightly offset by the KSB acquisition.
• Even with its strong capital position, the Company continues to consistently achieve industry-leading returns on equity due to its superior earnings performance.
• Stock Yards Bancorp continues to pursue and consider strategies to enhance stockholder value, including a substantial and sustained dividend payout ratio. In August 2019, the Company's board of directors continued the higher dividend rate of $0.26 per common share initially set in May 2019. With the May increase, Stock Yards Bancorp has raised its quarterly dividend rate 11 times since 2013, including two increases during 2018 and each of the previous four years.

Third Quarter 2019 Compared to Second Quarter 2019

Net interest income increased $1.3 million or 4%, as loan growth during the quarter, combined with a slight increase in margin, led to a record for the quarter.

Non-interest income increased 8%.

• WM&T, deposit service charges, treasury management fees and mortgage banking all showed increases for the linked quarter comparison.
• BOLI and other income increased due to the receipt of life insurance proceeds during the quarter.
• Swap fees totaling $108 thousand and $374 thousand were recognized during the second and third quarters, respectively.
• A one-time gain of $212 thousand on the sale of Visa Class B stock was realized during the third quarter of 2019.

Non-interest expenses improved 6%.

• As a result of the closing of the KSB acquisition on May 1, 2019, second quarter non-interest expenses included $1.3 million in pre-tax acquisition-related expenses, professional fees and compensation-related expenses.
• The company recorded no FDIC insurance expense during the third quarter of 2019.

The Company’s effective tax rate increased to 18.0% for the third quarter of 2019 from 5.9% for the second quarter of 2019.

• During the second quarter of 2019, Kentucky tax law changed to allow a bank holding company’s net operating losses to offset against net revenues generated by banks, beginning in 2021. In connection with this change, the Company recognized a non-recurring state deferred tax asset and corresponding state income tax benefit, the effect of which added $0.11 to net income per diluted share for the second quarter of 2019.

September 30, 2019 Compared to June 30, 2019

Total loans increased $93 million or 3%.

• The Company experienced continued strong production during the third quarter with loan pipelines remaining solid headed into the fourth quarter of 2019.

Total deposits increased $63 million or 2%.

• Money market, interest bearing demand and non-interest bearing deposit balances showed solid growth on the linked quarter basis.

Asset quality remained at historically strong levels.

• The allowance for loan and lease losses relative to total end-of-period loans was 0.94%, a decrease of two basis points.

About the Company

Louisville, Kentucky-based Stock Yards Bancorp, Inc., with $3.5 billion in assets, was incorporated in 1988 as a bank holding company. It is the parent company of Stock Yards Bank & Trust Company, which was established in 1904. The Company’s common shares trade on the NASDAQ Global Select Market under the symbol SYBT.

This report contains forward-looking statements under the Private Securities Litigation Reform Act that involve risks and uncertainties. Although the Company’s management believes the assumptions underlying the forward-looking statements contained herein are reasonable, any of these assumptions could be inaccurate. Therefore, there can be no assurance the forward-looking statements included herein will prove to be accurate. Factors that could cause actual results to differ from those discussed in forward-looking statements include, but are not limited to: economic conditions both generally and more specifically in the markets in which the Company and its subsidiary operates; competition for the Company’s customers from other providers of financial services; government legislation and regulation, which change and over which the Company has no control; changes in interest rates; material unforeseen changes in liquidity, results of operations, or financial condition of the Company’s customers; and other risks detailed in the Company’s filings with the Securities and Exchange Commission, all of which are difficult to predict and many of which are beyond the control of the Company. See Risk Factors outlined in the Company’s Form 10-K for the year ended December 31, 2018.

 

Stock Yards Bancorp, Inc. Financial Information (unaudited)
Third Quarter 2019 Earnings Release
(In thousands unless otherwise noted)
				Three Months Ended						Nine Months Ended
				September 30,						September 30,
Income Statement Data				2019			2018			2019			2018
Net interest income, fully tax equivalent (2)				$	32,131		$	28,590		$	92,673		$	84,751
Interest income:
Loans and leases				$	35,022		$	30,359		$	99,985		$	86,877
Federal funds sold and interest bearing due from banks					566			373			2,129			804
Mortgage loans held for sale					41			42			121			121
Securities					2,344			2,247			7,735			6,967
Total interest income					37,973			33,021			109,970			94,769
Interest expense:
Deposits					5,316			3,972			16,034			8,723
Securities sold under agreements to repurchase and other short-term borrowings					78			300			255			850
Federal Home Loan Bank (FHLB) advances and other long-term debt					509			228			1,180			692
Total interest expense					5,903			4,500			17,469			10,265
Net interest income					32,070			28,521			92,501			84,504
Provision for loan and lease losses					400			735			1,000			2,705
Net interest income after provision for loan and lease losses					31,670			27,786			91,501			81,799
Non-interest income:
Wealth management and trust services					5,738			5,380			16,839			16,224
Deposit service charges					1,444			1,482			4,027			4,340
Debit and credit card income					2,102			1,759			6,014			4,956
Treasury management fees					1,264			1,151			3,623			3,311
Mortgage banking income					834			712			2,112			2,034
Net investment product sales commissions and fees					400			444			1,120			1,245
Bank owned life insurance					487			186			849			564
Other					1,035			312			2,045			1,096
Total non-interest income					13,304			11,426			36,629			33,770
Non-interest expenses:
Compensation					12,330			11,607			36,846			34,280
Employee benefits					2,908			2,501			8,458			7,646
Net occupancy and equipment					2,199			1,914			6,033			5,543
Technology and communication					1,841			1,595			5,462			4,910
Debit and credit card processing					662			588			1,880			1,733
Marketing and business development					732			740			2,260			2,191
Postage, printing, and supplies					402			370			1,218			1,161
Legal and professional					524			501			2,581			1,498
FDIC insurance					-			238			486			718
Amortization/impairment of investments in tax credit partnerships					137			-			241			58
Capital and deposit based taxes					993			738			2,864			2,452
Other					1,229			989			3,731			2,754
Total non-interest expenses					23,957			21,781			72,060			64,944
Income before income tax expense					21,017			17,431			56,070			50,625
Income tax expense					3,783			3,555			6,652			9,766
Net income				$	17,234		$	13,876		$	49,418		$	40,859
Net income per share - Basic				$	0.76		$	0.61		$	2.18		$	1.81
Net income per share - Diluted					0.76			0.60			2.16			1.78
Cash dividend declared per share					0.26			0.25			0.77			0.71
Weighted average shares - Basic					22,550			22,636			22,633			22,613
Weighted average shares - Diluted					22,810			22,968			22,901			22,956
										September 30,
Balance Sheet Data										2019			2018
Loans and leases										$	2,856,664		$	2,534,483
Allowance for loan and lease losses											26,877			25,222
Total assets											3,533,926			3,324,797
Non-interest bearing deposits											795,793			705,386
Interest bearing deposits											2,150,520			1,892,652
FHLB advances											81,985			48,500
Stockholders' equity											396,111			352,980
Total shares outstanding											22,597			22,746
Book value per share (1)										$	17.53		$	15.52
Tangible common equity per share (1)											16.87			15.44
Market value per share											36.69			36.30

 

Stock Yards Bancorp, Inc. Financial Information (unaudited)
Third Quarter 2019 Earnings Release
				Three Months Ended								Nine Months Ended
				September 30,								September 30,
Average Balance Sheet Data				2019				2018				2019				2018
Federal funds sold and interest bearing due from banks				$	98,569			$	73,196			$	119,210			$	60,463
Mortgage loans held for sale					3,887				2,980				3,144				2,687
Securities available for sale					396,686				372,251				423,082				396,943
FHLB stock					11,317				10,370				10,704				9,004
Loans and leases					2,800,445				2,547,474				2,670,121				2,513,259
Total earning assets					3,310,904				3,006,271				3,226,261				2,982,356
Total assets					3,502,267				3,153,406				3,404,080				3,125,825
Interest bearing deposits					2,127,769				1,874,853				2,096,745				1,871,546
Total deposits					2,912,631				2,590,156				2,841,850				2,567,337
Securities sold under agreement to repurchase other short-term borrowings					48,376				116,287				49,690				121,400
FHLB advances and other long-term borrowings					83,386				48,612				68,718				48,927
Total interest bearing liabilities					2,259,531				2,039,752				2,215,153				2,041,873
Total stockholders' equity					392,840				351,376				381,743				343,248
Performance Ratios
Annualized return on average assets					1.95	%			1.75	%			1.94	%			1.75	%
Annualized return on average equity					17.41	%			15.67	%			17.31	%			15.92	%
Net interest margin, fully tax equivalent					3.86	%			3.79	%			3.85	%			3.82	%
Non-interest income to total revenue, fully tax equivalent					29.28	%			28.55	%			28.33	%			28.49	%
Efficiency ratio, fully tax equivalent (3)					52.73	%			54.43	%			55.73	%			54.80	%
Capital Ratios
Total stockholders' equity to total assets (1)													11.21	%			10.62	%
Tangible common equity to tangible assets (1)													10.83	%			10.57	%
Average stockholders' equity to average assets													11.21	%			10.98	%
Total risk-based capital													12.53	%			13.50	%
Common equity tier 1 risk-based capital													11.69	%			12.61	%
Tier 1 risk-based capital													11.69	%			12.61	%
Leverage													10.90	%			11.40	%
Loans by Type
Commercial and industrial												$	876,127			$	816,252
Construction and land development													283,465				233,107
Real estate mortgage - commercial investment													727,531				630,000
Real estate mortgage - owner occupied commercial													470,678				420,098
Real estate mortgage - 1-4 family residential													331,747				274,409
Home equity - first lien													51,015				46,062
Home equity - junior lien													72,533				67,105
Consumer													43,568				47,450
Total loans and leases												$	2,856,664			$	2,534,483
Asset Quality Data
Non-accrual loans												$	2,722			$	3,982
Troubled debt restructurings													35				792
Loans past due 90 days or more and still accruing													487				212
Total non-performing loans													3,244				4,986
Other real estate owned													563				1,604
Total non-performing assets												$	3,807			$	6,590
Non-performing loans to total loans													0.11	%			0.20	%
Non-performing assets to total assets													0.11	%			0.20	%
Allowance for loan and lease losses to total loans													0.94	%			1.00	%
Allowance for loan and lease losses to average loans													1.01	%			1.00	%
Allowance for loan and lease losses to non-performing loans													829	%			506	%
Net charge-offs (recoveries)				$	(61	)		$	386			$	(343	)		$	2,368
Net charge-offs (recoveries) to average loans (4)					0.00	%			0.02	%			-0.01	%			0.09	%

Stock Yards Bancorp, Inc. Financial Information (unaudited)
Third Quarter 2019 Earnings Release
		Quarterly Comparison
Income Statement Data		9/30/19				6/30/19				3/31/19				12/31/18				9/30/18
Net interest income, fully tax equivalent  (2)		$	32,131			$	30,829			$	29,713			$	29,972			$	28,590
Net interest income		$	32,070			$	30,774			$	29,657			$	29,912			$	28,521
Provision for loan and lease losses			400				-				600				-				735
Net interest income after provision for loan and lease losses			31,670				30,774				29,057				29,912				27,786
Non-interest income:
Wealth management and trust services			5,738				5,662				5,439				5,312				5,380
Deposit service charges			1,444				1,336				1,247				1,419				1,482
Debit and credit card income			2,102				2,168				1,744				1,813				1,759
Treasury management fees			1,264				1,202				1,157				1,260				1,151
Mortgage banking income			834				796				482				534				712
Net investment product sales commissions and fees			400				364				356				432				444
Bank owned life insurance			487				184				178				565				186
Other			1,035				551				459				241				312
Total non-interest income			13,304				12,263				11,062				11,576				11,426
Non-interest expenses:
Compensation			12,330				12,715				11,801				11,824				11,607
Employee benefits			2,908				2,908				2,642				2,452				2,501
Net occupancy and equipment			2,199				1,976				1,858				2,110				1,914
Technology and communication			1,841				1,848				1,773				1,660				1,595
Debit and credit card processing			662				631				587				594				588
Marketing and business development			732				903				625				908				740
Postage, printing, and supplies			402				410				406				397				370
Legal and professional			524				1,523				534				1,116				501
FDIC insurance			-				248				238				243				238
Amortization/impairment of investments in tax credit partnerships			137				52				52				1,179				-
Capital and deposit based taxes			993				967				904				873				738
Other			1,229				1,283				1,219				1,209				989
Total non-interest expenses			23,957				25,464				22,639				24,565				21,781
Income before income tax expense			21,017				17,573				17,480				16,923				17,431
Income tax expense			3,783				1,030				1,839				2,265				3,555
Net income		$	17,234			$	16,543			$	15,641			$	14,658			$	13,876
Net income per share - Basic		$	0.76			$	0.73			$	0.69			$	0.65			$	0.61
Net income per share - Diluted			0.76				0.72				0.68				0.64				0.60
Cash dividend declared per share			0.26				0.26				0.25				0.25				0.25
Weighted average shares - Basic			22,550				22,689				22,661				22,638				22,636
Weighted average shares - Diluted			22,810				22,949				22,946				22,907				22,968
		Quarterly Comparison
Balance Sheet Data		9/30/19				6/30/19				3/31/19				12/31/18				9/30/18
Cash and due from banks		$	68,107			$	51,264			$	44,014			$	51,892			$	66,029
Federal funds sold and interest bearing due from banks			68,107				64,775				67,326				147,047				54,451
Mortgage loans held for sale			6,329				3,922				2,981				1,675				2,533
Securities available for sale			375,601				423,579				507,131				436,995				550,091
FHLB stock			11,316				11,316				9,779				10,370				10,370
Loans and leases			2,856,664				2,763,880				2,525,709				2,548,171				2,534,483
Allowance for loan and lease losses			26,877				26,416				26,464				25,534				25,222
Total assets			3,533,926				3,463,823				3,281,016				3,302,924				3,324,797
Non-interest bearing deposits			795,793				777,652				698,783				711,023				705,386
Interest bearing deposits			2,150,520				2,105,801				2,053,757				2,083,333				1,892,652
Securities sold under agreements to repurchase			33,172				33,809				34,633				36,094				53,883
Federal funds purchased			9,957				12,012				12,218				10,247				231,344
FHLB advances			81,985				84,279				47,853				48,177				48,500
Stockholders' equity			396,111				389,365				377,994				366,500				352,980
Total shares outstanding			22,597				22,721				22,823				22,749				22,746
Book value per share (1)		$	17.53			$	17.14			$	16.56			$	16.11			$	15.52
Tangible common equity per share (1)			16.87				16.46				16.49				16.03				15.44
Market value per share			36.69				36.15				33.81				32.80				36.30
Capital Ratios
Total stockholders' equity to total assets (1)			11.21	%			11.24	%			11.52	%			11.10	%			10.62	%
Tangible common equity to tangible assets (1)			10.83	%			10.85	%			11.47	%			11.05	%			10.57	%
Average stockholders' equity to average assets			11.22	%			11.10	%			11.34	%			10.99	%			11.14	%
Total risk-based capital			12.53	%			12.67	%			14.04	%			13.91	%			13.50	%
Common equity tier 1 risk-based capital			11.69	%			11.82	%			13.11	%			13.00	%			12.61	%
Tier 1 risk-based capital			11.69	%			11.82	%			13.11	%			13.00	%			12.61	%
Leverage			10.90	%			10.91	%			11.57	%			11.33	%			11.40	%

 

Stock Yards Bancorp, Inc. Financial Information (unaudited)
Third Quarter 2019 Earnings Release
		Quarterly Comparison
Average Balance Sheet Data		9/30/19				6/30/19				3/31/19				12/31/18				9/30/18
Federal funds sold and interest bearing due from banks		$	98,569			$	137,130			$	122,189			$	86,725			$	73,196
Mortgage loans held for sale			3,887				3,794				1,727				2,140				2,980
Securities available for sale			396,686				435,391				437,619				468,856				372,251
Loans and leases			2,800,445				2,668,058				2,538,940				2,539,750				2,547,474
Total earning assets			3,310,904				3,244,941				3,100,352				3,096,931				2,990,401
Total assets			3,502,267				3,436,175				3,271,257				3,260,322				3,153,406
Interest bearing deposits			2,127,769				2,112,768				2,048,830				2,012,489				1,874,853
Total deposits			2,912,631				2,867,360				2,743,701				2,738,678				2,590,156
Securities sold under agreement to repurchase and other short-term borrowings			48,376				51,743				48,956				67,731				116,287
FHLB advances			83,386				74,420				47,962				48,287				48,612
Total interest bearing liabilities			2,259,531				2,238,931				2,145,748				2,128,507				2,039,752
Total stockholders' equity			392,840				381,270				371,070				358,293				351,376
Performance Ratios
Annualized return on average assets			1.95	%			1.93	%			1.94	%			1.78	%			1.75	%
Annualized return on average equity			17.41	%			17.40	%			17.09	%			16.23	%			15.67	%
Net interest margin, fully tax equivalent			3.86	%			3.81	%			3.89	%			3.84	%			3.79	%
Non-interest income to total revenue, fully tax equivalent			29.28	%			28.46	%			27.13	%			27.86	%			28.55	%
Efficiency ratio, fully tax equivalent (3)			52.73	%			59.09	%			55.52	%			59.12	%			54.43	%
Loans by Type
Commercial and industrial		$	876,127			$	860,085			$	827,747			$	833,524			$	816,252
Construction and land development			283,465				257,801				244,548				255,142				233,107
Real estate mortgage - commercial investment			727,531				696,421				586,648				588,610				630,000
Real estate mortgage - owner occupied commercial			470,678				452,719				428,163				426,373				420,098
Real estate mortgage - 1-4 family residential			331,747				338,957				277,847				276,017				274,409
Home equity - first lien			51,015				46,012				48,656				49,500				46,062
Home equity - junior lien			72,533				67,948				66,837				70,947				67,105
Consumer			43,568				43,937				45,263				48,058				47,450
Total loans and leases		$	2,856,664			$	2,763,880			$	2,525,709			$	2,548,171			$	2,534,483
Asset Quality Data
Non-accrual loans		$	2,722			$	3,030			$	3,273			$	2,611			$	3,982
Troubled debt restructurings			35				37				39				42				792
Loans past due 90 days or more and still accruing			487				861				454				745				212
Total non-performing loans			3,244				3,928				3,766				3,398				4,986
Other real estate owned			563				563				878				1,018				1,604
Total non-performing assets		$	3,807			$	4,491			$	4,644			$	4,416			$	6,590
Non-performing loans to total loans			0.11	%			0.14	%			0.15	%			0.13	%			0.20	%
Non-performing assets to total assets			0.11	%			0.13	%			0.14	%			0.13	%			0.20	%
Allowance for loan and lease losses to total loans			0.94	%			0.96	%			1.05	%			1.00	%			1.00	%
Allowance for loan and lease losses to average loans			0.96	%			0.99	%			1.04	%			1.01	%			1.00	%
Allowance for loan and lease losses to non-performing loans			829	%			673	%			703	%			751	%			506	%
Net charge-offs (recoveries)		$	(61	)		$	48			$	(330	)		$	(312	)		$	386
Net charge-offs (recoveries) to average loans (4)			0.00	%			0.00	%			-0.01	%			-0.01	%			0.02	%
Other Information
Total assets under management (in millions)		$	3,116			$	3,068			$	2,970			$	2,765			$	2,969
Full-time equivalent employees			622				615				596				591				593
(1) - The following table provides a reconciliation of total stockholders’ equity in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) to tangible stockholders’ equity, a non-GAAP disclosure. The Company provides the tangible book value per share, a non-GAAP measure, in addition to those defined by banking regulators, because of its widespread use by investors as a means to evaluate capital adequacy:

 

		Quarterly Comparison
		9/30/19				6/30/19				3/31/19				12/31/18				9/30/18
Total stockholders' equity - GAAP (a)		$	396,111			$	389,365			$	377,994			$	366,500			$	352,980
Less: Goodwill			(12,593	)			(12,826	)			(682	)			(682	)			(682	)
Less: Core deposit intangible			(2,373	)			(2,461	)			(1,015	)			(1,057	)			(1,098	)
Tangible common equity - Non-GAAP (c)		$	381,145			$	374,078			$	376,297			$	364,761			$	351,200
Total assets - GAAP (b)		$	3,533,926			$	3,463,823			$	3,281,016			$	3,302,924			$	3,324,797
Less: Goodwill			(12,593	)			(12,826	)			(682	)			(682	)			(682	)
Less: Core deposit intangible			(2,373	)			(2,461	)			(1,015	)			(1,057	)			(1,098	)
Tangible assets - Non-GAAP (d)		$	3,518,960			$	3,448,536			$	3,279,319			$	3,301,185			$	3,323,017
Total stockholders' equity to total assets - GAAP (a/b)			11.21	%			11.24	%			11.52	%			11.10	%			10.62	%
Tangible common equity to tangible assets - Non-GAAP (c/d)			10.83	%			10.85	%			11.47	%			11.05	%			10.57	%
Total shares outstanding (e)			22,597				22,721				22,823				22,749				22,746
Book value per share - GAAP (a/e)		$	17.53			$	17.14			$	16.56			$	16.11			$	15.52
Tangible common equity per share - Non-GAAP (c/e)			16.87				16.46				16.49				16.03				15.44
(2) - Interest income on a fully tax equivalent basis includes the additional amount of interest income that would have been earned if investments in certain tax-exempt interest earning assets had been made in assets subject to federal, state and local taxes yielding the same after-tax income.
(3) - The efficiency ratio, a non-GAAP measure, equals total non interest expense divided by the sum of fully tax equivalent net interest income and non interest income. The ratio excludes net gains (losses) on sales, calls, and impairment of investment securities, if applicable.
(4) - Quarterly net charge-offs (recoveries) to average loans ratios are not annualized.

 

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