The First Bancshares(US:FBMS)2024-08-09 16:24Financial Performance - Net income for the three months ended June 30, 2024, was $19,697 thousand, down from $23,779 thousand in the same period of 2023, reflecting a decrease of 17.4%[5] - Basic earnings per share for the three months ended June 30, 2024, were $0.62, down from $0.76 in the same period of 2023, a decline of 18.4%[5] - Net income for the six months ended June 30, 2024, was $40,325,000, compared to $40,050,000 for the same period in 2023, reflecting a slight increase[14] - Net income available to common shareholders for Q2 2024 was $19.7 million, a decrease of 17.2% from $23.8 million in Q2 2023[134] - For the first six months of 2024, net income available to common shareholders was $40.3 million, a slight increase of 0.7% from $40.1 million in the same period of 2023[139] Assets and Liabilities - Total assets as of June 30, 2024, were $7,965,800 thousand, a decrease from $7,999,345 thousand as of December 31, 2023, representing a decline of approximately 0.42%[4] - Total liabilities decreased to $6,993,915 thousand as of June 30, 2024, from $7,050,311 thousand at the end of 2023, a reduction of approximately 0.8%[4] - Total shareholders' equity increased to $971,885 thousand as of June 30, 2024, from $949,034 thousand at the end of 2023, an increase of 2.4%[4] - The company had approximately $7.966 billion in total assets, $5.196 billion in net loans held for investment, and $6.626 billion in deposits as of June 30, 2024[18] Deposits and Loans - Total deposits increased to $6,626,117 thousand as of June 30, 2024, compared to $6,462,872 thousand at the end of 2023, marking an increase of 2.5%[4] - As of June 30, 2024, total loans held for investment (LHFI) amounted to $5,250,893 thousand, an increase from $5,170,042 thousand as of December 31, 2023, representing a growth of approximately 1.55%[77] - The net LHFI as of June 30, 2024, was $5,195,760 thousand, up from $5,116,010 thousand at the end of 2023, indicating a net increase of about 1.55%[77] - Loans increased by $83.8 million, or 1.6%, to $5.257 billion during the first six months of 2024[141] Income and Expenses - Net interest income after provision for credit losses for the six months ended June 30, 2024, was $113,485 thousand, compared to $118,706 thousand for the same period in 2023, a decrease of 4.4%[5] - Non-interest income for the three months ended June 30, 2024, totaled $13,319 thousand, an increase from $12,423 thousand in the same period of 2023, representing an increase of 7.2%[5] - Non-interest expense decreased to $44,089 thousand for the three months ended June 30, 2024, down from $46,899 thousand in the same period of 2023, a reduction of 6.0%[149] - Non-interest expense decreased by $5.1 million to $87.5 million for the six months ended June 30, 2024, primarily due to a reduction in acquisition charges[140] Credit Losses and Provisions - The company reported a provision for credit losses of $1,650 thousand for the three months ended June 30, 2024, compared to $1,000 thousand in the same period of 2023[5] - The total ending allowance for credit losses as of June 30, 2024, was $55.133 million, compared to $52.614 million as of June 30, 2023, reflecting an increase of approximately 4.8% year-over-year[110] - The Company recorded a provision for credit losses of $1.7 million for the three months ended June 30, 2024, compared to $1.0 million for the same period in 2023[177] - The allowance for credit losses (ACL) was $55,100 thousand, or 1.05% of loans held for investment (LHFI), reflecting a 2.0% increase from December 31, 2023[175] Acquisitions - The company completed the acquisition of Heritage Southeast Bancorporation, Inc. for a total consideration of $221.5 million, which included 6,920,422 shares of common stock[28] - The Company completed the acquisition of Beach Bancorp, Inc. for a total consideration of $101.5 million, including 3,498,936 shares of common stock and $1 thousand in cash[32] - The Company acquired loans totaling $1.159 billion in January 2023 as part of the HSBI acquisition, which included an initial allowance for credit losses of $3.2 million related to purchased credit-deteriorated loans[113] Securities and Investments - The total available-for-sale securities as of June 30, 2024, is valued at $1,124,462 thousand, with significant unobservable inputs (Level 3) amounting to $25,340 thousand[52] - The fair value of available-for-sale securities was $1.124 billion at June 30, 2024, up from $1.042 billion at December 31, 2023[157] - The Company’s net unrealized loss on the investment portfolio was $129.0 million at June 30, 2024, compared to a loss of $121.9 million at December 31, 2023[157] - The total amortized cost of available-for-sale securities was $1,253,465 thousand, with a fair value of $1,124,462 thousand as of June 30, 2024[71] Risk Management - The Company classifies loans into risk categories, with "Pass" loans deemed to possess average to superior credit quality[95] - Loans classified as "Special Mention" indicate potential weaknesses that require close management attention[96] - "Substandard" loans are inadequately protected by the obligor's net worth and have well-defined weaknesses that jeopardize debt liquidation[97] - The Company believes the current allowance for credit losses is appropriate, with potential adjustments based on changes in risk factors[175] Dividends and Shareholder Returns - The company declared dividends on common stock of $0.25 per share for the six months ended June 30, 2024, totaling $15,576,000[12] - The Company authorized a new share repurchase program for up to $50 million in 2024, following a similar program in 2023[201]