Byline Bancorp(BY) - 2022 Q2 - Quarterly Report

Financial Performance - Byline Bancorp reported consolidated net income of $20.3 million for the three months ended June 30, 2022, a decrease of$8.2 million compared to $28.5 million for the same period in 2021[219]. - Consolidated net income for the three months ended June 30, 2022, was$20.3 million, a decrease of $8.2 million from$28.5 million for the same period in 2021[252]. - Net income available to common stockholders for the three months ended June 30, 2022, was $20.3 million, or$0.55 per basic share[223]. - Basic earnings per common share for the three months ended June 30, 2022, was $0.55, down from$0.75 in the same period of 2021[254]. - Consolidated net income for the six months ended June 30, 2022, was $42.6 million, a decrease of$7.7 million from $50.3 million for the same period in 2021[256]. - Net income available to common stockholders for the six months ended June 30, 2022, was$42.4 million, or $1.14 per basic share, down from$1.31 in the same period in 2021[258]. - Adjusted diluted earnings per share for the three months ended June 30, 2022, was $0.54, compared to$0.73 for the same period in 2021[381]. - Net income available to common stockholders for the three months ended June 2022 was $20,283, down from$28,297 in the same period last year, indicating a decrease of 28.3%[383]. Asset and Liability Overview - Total assets as of June 30, 2022, were $7.1 billion, with total gross loans and leases outstanding at$5.2 billion and total deposits at $5.4 billion[225]. - Total stockholders' equity as of June 30, 2022, was$765.2 million[225]. - Total liabilities increased by $506.8 million, or 8.6$6.4 billion at June 30, 2022 compared to $5.9 billion at December 31, 2021[307]. - Total stockholders' equity decreased to$780,652 thousand from $810,490 thousand[266]. - Total estimated uninsured deposits were$1.6 billion as of June 30, 2022[348]. Loan and Lease Performance - Total loans and leases increased to $5.2 billion as of June 30, 2022, up$630.9 million or 13.9% from $4.5 billion at December 31, 2021[320]. - Originated loans and leases reached$4.8 billion, reflecting an increase of $724.6 million or 17.7$4.1 billion at December 31, 2021[320]. - The allowance for loan and lease losses was $62.4 million as of June 30, 2022, compared to$55.0 million at December 31, 2021[321]. - The loan and lease portfolio includes $2.0 billion with interest rate floors, with$108.7 million at the floor or with no floor[331]. - The loan and lease to deposit ratio was 96.2% at June 30, 2022, compared to 89.3% at December 31, 2021, indicating a tighter funding environment[346]. Income and Expense Analysis - Net interest income increased by $3.5 million for the three months ended June 30, 2022, driven by growth in the loan and lease portfolio[219]. - Non-interest income decreased to$14.2 million for the three months ended June 30, 2022, a decline of $6.8 million, or 32.6$43.8 million for Q2 2022, an increase of 1.8% from $43.0 million in Q2 2021[290]. - Salaries and employee benefits totaled$27.7 million for Q2 2022, up 12.6% from $24.6 million in Q2 2021[290]. - The efficiency ratio for the six months ended June 30, 2022, was 55.12$7.9 million for the three months ended June 30, 2022, primarily due to loan and lease growth[219]. - Provision for loan and lease losses was $5.9 million for the three months ended June 30, 2022, compared to a recapture of$2.0 million for the same period in 2021, an increase of $7.9 million[279]. - The allowance for loan and lease losses as a percentage of loans and leases was 1.21$15,031 million, a decrease from $10,903 million[338]. Market and Economic Conditions - The company evaluates the recoverability of deferred tax assets based on expected taxable income and establishes a valuation allowance if realization is deemed unlikely[245]. - The company monitors the appropriate level of ALLL on a quarterly basis, with more frequent assessments as needed[332]. - The bank's interest rate risk exposure is managed within board-approved policy limits, with results being hypothetical and subject to various influencing factors[391]. Capital and Dividends - Stockholders' equity at June 30, 2022 was$765.2 million, a decrease of $71.2 million or 8.5$12.0 million in cash dividends from Byline Bank for the six months ended June 30, 2022, and $24.0 million for the year ended December 31, 2021[364]. - A cash dividend of$0.09 per share was declared on July 26, 2022, payable on August 23, 2022[368]. Interest Rate Management - The company had a notional amount of $1.1 billion in interest rate swaps outstanding as of June 30, 2022, to manage interest rate risk[387]. - The simulation model indicates that a 300 basis point increase in interest rates could lead to a 22.8$313,099[389]. - A gradual upward shift of 100 basis points would increase net interest income by 1.3%, while a 200 basis point increase would result in a 2.8% increase[390].