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    First Financial Corporation Reports 2023 Results

    TERRE HAUTE, Ind., Jan. 30, 2024 (GLOBE NEWSWIRE) -- First Financial Corporation (NASDAQ:THFF) today announced results for the fourth quarter of 2023.

    • Net income was $12.4 million compared to the $16.5 million reported for the same period of 2022;
    • Diluted net income per common share of $1.06 compared to $1.37 for the same period of 2022;
    • Return on average assets was 1.05% compared to 1.34% for the three months ended December 31, 2022;
    • Credit loss provision was $2.5 million compared to provision of $2.7 million for the fourth quarter 2022; and
    • Pre-tax, pre-provision net income was $16.6 million compared to $21.7 million for the same period in 2022.1

    The Corporation further reported results for the year ended December 31, 2023:

    • Net income was $60.7 million compared to the $71.1 million reported for the same period of 2022, which included the proceeds of a legal settlement and pandemic related reserve releases, both of which were non-recurring events;
    • Diluted net income per common share of $5.08 compared to $5.82 for the same period of 2022;
    • Return on average assets was 1.26% compared to 1.41% for the twelve months ended December 31, 2022;
    • Credit loss provision was $7.3 million compared to negative provision of $2.0 million for the twelve months ended December 31, 2022; and
    • Pre-tax, pre-provision net income was $79.7 million compared to $84.9 million for the same period in 2022.1

    ___________________________
    1 Non-GAAP financial measure that Management believes is useful for investors and management to understand pre-tax profitability before giving effect to credit loss expense and to provide additional perspective on the Corporations performance over time as well as comparison to the Corporations peers and evaluating the financial results of the Corporation – please refer to the Non GAAP reconciliations contained in this release.

    Average Total Loans

    Average total loans for the fourth quarter of 2023 were $3.13 billion versus $3.02 billion for the comparable period in 2022, an increase of $117 million or 3.89%.

    Total Loans Outstanding

    Total loans outstanding as of December 31, 2023, were $3.17 billion compared to $3.07 billion as of December 31, 2022, an increase of $100 million or 3.27%, primarily driven by increases in Commercial Construction and Development, Commercial Real Estate, and Consumer Auto loans.

    “We are pleased with our fourth quarter results, as we experienced another quarter of loan growth in a challenging environment. Our credit quality remains stable, and disciplined approach to expense management is constant,” said Norman D. Lowery, President and Chief Executive Officer. “During the quarter we were pleased to announce the signing of a definitive agreement with SimplyBank, which expands our presence into new attractive MSAs in the Tennessee market.”

    Average Total Deposits

    Average total deposits for the quarter ended December 31, 2023, were $4.05 billion versus $4.38 billion as of December 31, 2022. On a linked quarter basis, average deposits increased $50.7 million, or 1.27% from $4.00 billion as of September 30, 2023.

    Total Deposits

    Total deposits were $4.09 billion as of December 31, 2023, compared to $4.37 billion as of December 31, 2022.

    Shareholder Equity

    Shareholder equity at December 31, 2023, was $526.6 million compared to $475.3 million on December 31, 2022. Overall accumulated other comprehensive income/(loss) (“AOCI”) on investments available for sale increased $10.9 million in comparison to December 31, 2022, and increased $47.4 million in comparison to September 30, 2023. During the quarter, there were no share repurchases. An additional 518,860 shares remains under the current repurchase authorization. The Corporation also declared a $0.45 quarterly dividend during the quarter.

    Book Value Per Share

    Book Value per share was $44.64 as of December 31, 2023, compared to $39.44 as of December 31, 2022, an increase of 13.20%.

    Tangible Common Equity to Tangible Asset Ratio

    The Corporation’s tangible common equity to tangible asset ratio was 9.12% at December 31, 2023, compared to 7.79% at December 31, 2022.

    Net Interest Income

    Net interest income for the fourth quarter of 2023 was $39.6 million, compared to $43.7 million reported for the same period of 2022, a decrease of $4.1 million or 9.32%.

    Net Interest Margin

    The net interest margin for the quarter ended December 31, 2023, was 3.63% compared to the 3.81% reported at December 31, 2022, an decrease of 17 basis points or 4.55%.

    Nonperforming Loans

    Nonperforming loans as of December 31, 2023, were $24.6 million versus $9.6 million as of December 31, 2022. The ratio of nonperforming loans to total loans and leases was 0.78% as of December 31, 2023, versus 0.31% as of December 31, 2022. The increase in nonperforming loans is due to a commercial relationship that was downgraded during the quarter.

    Credit Loss Provision

    The provision for credit losses for the three months ended December 31, 2023, was $2.5 million, compared to $2.7 million for the fourth quarter 2022.

    Net Charge-Offs

    In the fourth quarter of 2023 net charge-offs were $1.76 million compared to $2.44 million in the same period of 2022.

    Allowance for Credit Losses

    The Corporation’s allowance for credit losses as of December 31, 2023, was $39.8 million compared to $39.8 million as of December 31, 2022. The allowance for credit losses as a percent of total loans was 1.26% as of December 31, 2023, compared to 1.30% as of December 31, 2022. On a linked quarter basis, the allowance for credit losses as a percent of total loans increased 1 basis point from 1.25% as of September 30, 2023.

    Non-Interest Income

    Non-interest income for the three months ended December 31, 2023 and 2022 was $11.2 million and $10.6 million, respectively, an increase of $679 thousand or 6.43%.

    Non-Interest Expense

    Non-interest expense for the three months ended December 31, 2023, was $34.2 million compared to $32.5 million in 2022.

    Efficiency Ratio

    The Corporation’s efficiency ratio was 65.62% for the quarter ending December 31, 2023, versus 58.78% for the same period in 2022.

    Income Taxes

    Income tax expense for the three months ended December 31, 2023, was $1.7 million versus $2.5 million for the same period in 2022. The effective tax rate for 2023 was 16.31% compared to 18.97% for 2022. The decrease in effective tax rate is due to a $1 million increase in tax credit investments, as well as an increase in tax exempt interest income compared to December 31, 2022.

    About First Financial Corporation

    First Financial Corporation (NASDAQ:THFF) is the holding company for First Financial Bank N.A. First Financial Bank N.A., the fifth oldest national bank in the United States, operates 70 banking centers in Illinois, Indiana, Kentucky and Tennessee. Additional information is available at www.first-online.bank.

    Investor Contact:
    Rodger A. McHargue
    Chief Financial Officer
    P: 812-238-6334
    E: rmchargue@first-online.com

                                           
        Three Months Ended   Year Ended
        December 31,   September 30,   December 31,   December 31,   December 31,
        2023   2023   2022   2023   2022
    END OF PERIOD BALANCES                                      
    Assets   $ 4,851,146     $ 4,784,806     $ 4,989,281     $ 4,851,146     $ 4,989,281  
    Deposits   $ 4,090,068     $ 4,040,995     $ 4,368,871     $ 4,090,068     $ 4,368,871  
    Loans, including net deferred loan costs   $ 3,167,821     $ 3,117,626     $ 3,067,438     $ 3,167,821     $ 3,067,438  
    Allowance for Credit Losses   $ 39,767     $ 39,034     $ 39,779     $ 39,767     $ 39,779  
    Total Equity   $ 527,976     $ 470,168     $ 475,293     $ 527,976     $ 475,293  
    Tangible Common Equity(a)   $ 435,405     $ 377,367     $ 381,594     $ 435,405     $ 381,594  
                                           
    AVERAGE BALANCES                                      
    Total Assets   $ 4,725,297     $ 4,814,251     $ 4,930,611     $ 4,802,448     $ 5,043,987  
    Earning Assets   $ 4,485,766     $ 4,575,996     $ 4,690,594     $ 4,564,135     $ 4,800,481  
    Investments   $ 1,279,821     $ 1,351,433     $ 1,393,753     $ 1,358,661     $ 1,432,681  
    Loans   $ 3,133,267     $ 3,147,317     $ 3,015,903     $ 3,111,784     $ 2,884,053  
    Total Deposits   $ 4,050,968     $ 4,000,302     $ 4,383,505     $ 4,106,132     $ 4,408,510  
    Interest-Bearing Deposits   $ 3,291,931     $ 3,222,633     $ 3,509,416     $ 3,304,816     $ 3,517,468  
    Interest-Bearing Liabilities   $ 206,778     $ 309,948     $ 84,210     $ 199,551     $ 97,134  
    Total Equity   $ 463,004     $ 493,764     $ 438,767     $ 486,572     $ 494,837  
                                           
    INCOME STATEMENT DATA                                      
    Net Interest Income   $ 39,590     $ 41,150     $ 43,658     $ 167,262     $ 165,042  
    Net Interest Income Fully Tax Equivalent(b)   $ 40,942     $ 42,539     $ 44,724     $ 172,716     $ 169,699  
    Provision for Credit Losses   $ 2,495     $ 1,200     $ 2,725     $ 7,295     $ (2,025 )
    Non-interest Income   $ 11,247     $ 11,627     $ 10,568     $ 42,702     $ 46,716  
    Non-interest Expense   $ 34,244     $ 32,265     $ 32,501     $ 130,176     $ 126,023  
    Net Income   $ 12,420     $ 16,285     $ 16,521     $ 60,672     $ 71,109  
                                           
    PER SHARE DATA                                      
    Basic and Diluted Net Income Per Common Share   $ 1.06     $ 1.37     $ 1.37     $ 5.08     $ 5.82  
    Cash Dividends Declared Per Common Share   $ 0.45     $     $ 0.74     $ 0.99     $ 1.28  
    Book Value Per Common Share   $ 44.76     $ 40.00     $ 39.44     $ 44.76     $ 39.44  
    Tangible Book Value Per Common Share(c)   $ 31.47     $ 33.69     $ 28.67     $ 36.91     $ 31.66  
    Basic Weighted Average Common Shares Outstanding     11,772       11,901       12,037       11,937       12,211  

    ________________________________

    (a)   Tangible common equity is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible common equity by excluding goodwill and other intangible assets from shareholder’s equity.
    (b)   Net interest income fully tax equivalent is a non-GAAP financial measure derived from GAAP-based amounts. We calculate net interest income fully tax equivalent by adding back the tax equivalent factor of tax exempt income to net interest income. We calculate the tax equivalent factor of tax exempt income by dividing tax exempt income by the net of tax rate of 75%.
    (c)   Tangible book value per common share is a non-GAAP financial measure derived from GAAP-based amounts. We calculate the factor by dividing average tangible common equity by average shares outstanding. We calculate average tangible common equity by excluding average intangible assets from average shareholder’s equity.

                           
    Key Ratios   Three Months Ended   Year Ended  
        December 31,   September 30,   December 31,   December 31,   December 31,  
        2023   2023   2022   2023   2022  
    Return on average assets   1.05 % 1.35 % 1.34 % 1.26 % 1.41 %
    Return on average common shareholder's equity   10.73 % 13.19 % 15.06 % 12.47 % 14.37 %
    Efficiency ratio   65.62 % 59.57 % 58.78 % 60.43 % 58.23 %
    Average equity to average assets   9.80 % 10.26 % 8.90 % 10.13 % 9.81 %
    Net interest margin(a)   3.63 % 3.74 % 3.81 % 3.78 % 3.54 %
    Net charge-offs to average loans and leases   0.22 % 0.24 % 0.32 % 0.23 % 0.23 %
    Credit loss reserve to loans and leases   1.26 % 1.25 % 1.30 % 1.26 % 1.30 %
    Credit loss reserve to nonperforming loans   161.94 % 310.19 % 414.36 % 161.94 % 414.36 %
    Nonperforming loans to loans and leases   0.78 % 0.40 % 0.31 % 0.78 % 0.31 %
    Tier 1 leverage   12.14 % 11.72 % 10.78 % 12.14 % 10.78 %
    Risk-based capital - Tier 1   14.76 % 14.61 % 13.58 % 14.76 % 13.58 %

    __________________________________

    (a)   Net interest margin is calculated on a tax equivalent basis.

                                             
    Asset Quality   Three Months Ended   Year Ended
        December 31,   September 30,   December 31,   December 31,   December 31,
        2023   2023   2022   2023   2022
    Accruing loans and leases past due 30-89 days   $ 20,168     $ 15,961     $ 28,875     $ 20,168     $ 28,875  
    Accruing loans and leases past due 90 days or more   $ 960     $ 1,370     $ 1,119     $ 960     $ 1,119  
    Nonaccrual loans and leases   $ 23,596     $ 11,214     $ 8,481     $ 23,596     $ 8,481  
    Other real estate owned   $ 107     $ 63     $ 337     $ 107     $ 337  
    Nonperforming loans and other real estate owned   $ 24,663     $ 12,647     $ 9,937     $ 24,663     $ 9,937  
    Total nonperforming assets   $ 27,665     $ 15,671     $ 12,923     $ 27,665     $ 12,923  
    Gross charge-offs   $ 3,976     $ 3,601     $ 4,388     $ 15,496     $ 15,706  
    Recoveries   $ 2,213     $ 1,528     $ 1,947     $ 8,188     $ 9,205  
    Net charge-offs/(recoveries)   $ 1,763     $ 2,073     $ 2,441     $ 7,308     $ 6,501  
                                             


                     
    Non-GAAP Reconciliations   Three Months Ended December 31,
        2023   2022
    ($in thousands, except EPS)                
    Income before Income Taxes   $ 14,098     $ 19,000  
    Provision for credit losses     2,495       2,725  
    Provision for unfunded commitments            
    Pre-tax, Pre-provision Income   $ 16,593     $ 21,725  


                 
    Non-GAAP Reconciliations   Year Ended December 31,
        2023
      2022
    ($ in thousands, except EPS)            
    Income before Income Taxes   $ 72,493     $ 87,760  
    Provision for credit losses     7,295       (2,025 )
    Provision for unfunded commitments     (100 )     (850 )
    Pre-tax, Pre-provision Income   $ 79,688     $ 84,885  
                     


     
    CONSOLIDATED BALANCE SHEETS
    (Dollar amounts in thousands, except per share data)
                 
        December 31,   December 31,
        2023
      2022
        (unaudited)
    ASSETS            
    Cash and due from banks   $ 76,759     $ 222,517  
    Federal funds sold     282       9,374  
    Securities available-for-sale     1,259,137       1,330,481  
    Loans:            
    Commercial     1,817,526       1,798,260  
    Residential     695,788       673,464  
    Consumer     646,758       588,539  
          3,160,072       3,060,263  
    (Less) plus:            
    Net deferred loan costs     7,749       7,175  
    Allowance for credit losses     (39,767 )     (39,779 )
          3,128,054       3,027,659  
    Restricted stock     15,364       15,378  
    Accrued interest receivable     24,877       21,288  
    Premises and equipment, net     67,286       66,147  
    Bank-owned life insurance     114,122       115,704  
    Goodwill     86,985       86,985  
    Other intangible assets     5,586       6,714  
    Other real estate owned     107       337  
    Other assets     72,587       86,697  
    TOTAL ASSETS   $ 4,851,146     $ 4,989,281  
                 
    LIABILITIES AND SHAREHOLDERS’ EQUITY            
    Deposits:            
    Non-interest-bearing   $ 750,335     $ 857,920  
    Interest-bearing:            
    Certificates of deposit exceeding the FDIC insurance limits     92,921       50,608  
    Other interest-bearing deposits     3,246,812       3,460,343  
          4,090,068       4,368,871  
    Short-term borrowings     67,221       70,875  
    FHLB advances     108,577       9,589  
    Other liabilities     57,304       64,653  
    TOTAL LIABILITIES     4,323,170       4,513,988  
                 
    Shareholders’ equity            
    Common stock, $.125 stated value per share;            
    Authorized shares-40,000,000            
    Issued shares-16,137,220 in 2023 and 16,114,992 in 2022            
    Outstanding shares-11,795,024 in 2023 and 12,051,964 in 2022     2,014       2,012  
    Additional paid-in capital     144,152       143,185  
    Retained earnings     663,726       614,829  
    Accumulated other comprehensive income/(loss)     (127,087 )     (139,974 )
    Less: Treasury shares at cost-4,342,196 in 2023 and 4,063,028 in 2022     (154,829 )     (144,759 )
    TOTAL SHAREHOLDERS’ EQUITY     527,976       475,293  
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY   $ 4,851,146     $ 4,989,281  
                     


     
    CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
    (Dollar amounts in thousands, except per share data)
                       
        Year Ended
        December 31,
        2023
      2022
      2021
        (unaudited)
    INTEREST INCOME:                  
    Loans, including related fees   $ 189,641     $ 146,295     $ 128,000  
    Securities:                  
    Taxable     24,643       21,014       13,110  
    Tax-exempt     10,573       9,974       8,762  
    Other     3,540       6,018       2,326  
    TOTAL INTEREST INCOME     228,397       183,301       152,198  
    INTEREST EXPENSE:                  
    Deposits     51,694       16,743       8,158  
    Short-term borrowings     5,370       1,243       387  
    Other borrowings     4,071       273       252  
    TOTAL INTEREST EXPENSE     61,135       18,259       8,797  
    NET INTEREST INCOME     167,262       165,042       143,401  
    Provision for credit losses     7,295       (2,025 )     2,466  
    NET INTEREST INCOME AFTER PROVISION                  
    FOR LOAN LOSSES     159,967       167,067       140,935  
    NON-INTEREST INCOME:                  
    Trust and financial services     5,155       5,155       5,255  
    Service charges and fees on deposit accounts     28,079       27,540       24,700  
    Other service charges and fees     801       665       1,163  
    Securities gains (losses), net     (1 )     3       114  
    Interchange income     676       559       438  
    Loan servicing fees     1,176       1,554       1,849  
    Gain on sales of mortgage loans     966       1,994       5,003  
    Other     5,850       9,246       3,562  
    TOTAL NON-INTEREST INCOME     42,702       46,716       42,084  
    NON-INTEREST EXPENSE:                  
    Salaries and employee benefits     68,525       65,555       64,474  
    Occupancy expense     9,351       9,764       8,774  
    Equipment expense     14,020       12,391       10,174  
    FDIC Expense     2,907       2,327       1,294  
    Other     35,373       35,986       32,690  
    TOTAL NON-INTEREST EXPENSE     130,176       126,023       117,406  
    INCOME BEFORE INCOME TAXES     72,493       87,760       65,613  
    Provision for income taxes     11,821       16,651       12,626  
    NET INCOME     60,672       71,109       52,987  
    OTHER COMPREHENSIVE INCOME (LOSS)                  
    Change in unrealized gains/(losses) on securities, net of reclassifications and taxes     10,896       (144,570 )     (18,488 )
    Change in funded status of post retirement benefits, net of taxes     1,991       7,022       6,298  
    COMPREHENSIVE INCOME (LOSS)   $ 73,559     $ (66,439 )   $ 40,797  
    PER SHARE DATA                  
    Basic and Diluted Earnings per Share   $ 5.08     $ 5.82     $ 4.02  
    Weighted average number of shares outstanding (in thousands)     11,937       12,211       13,190  
                             




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    First Financial Corporation Reports 2023 Results TERRE HAUTE, Ind., Jan. 30, 2024 (GLOBE NEWSWIRE) - First Financial Corporation (NASDAQ:THFF) today announced results for the fourth quarter of 2023. Net income was $12.4 million compared to the $16.5 million reported for the same period of …