First Foundation (US:FFWM)2021-05-07 17:37Loans and Deposits - Total loans increased by $321 million in Q1 2021, driven by $765 million in originations and $56 million in loan purchases, partially offset by $500 million in payoffs or scheduled payments [109]. - Loans and loans held for sale rose by $321 million in Q1 2021, with $765 million in originations partially offset by $500 million in payoffs [134]. - Total deposits rose by $332 million, and total revenues increased by 19% compared to Q1 2020 [110]. - Deposits grew by $332 million in Q1 2021, including a $419 million increase in commercial deposits [136]. - The total amount of deposits increased to $6,245,821,000 as of March 31, 2021, up from $5,913,433,000 as of December 31, 2020 [145]. - The loan-to-deposit ratio was 90.1% as of March 31, 2021, compared to 89.8% at the end of 2020 [169]. Financial Performance - Net income for the three months ended March 31, 2021, was $22.4 million, compared to $13.2 million for the same period in 2020, representing a 69% increase [117]. - Net interest income increased by 21% from $44.9 million in Q1 2020 to $54.3 million in Q1 2021, driven by a 12% increase in interest-earning assets and an improved net interest rate spread [121]. - Noninterest income for Banking was $5.3 million in Q1 2021, up from $4.7 million in Q1 2020, primarily due to increased loan fees and trust fees [125]. - Noninterest income for Wealth Management increased by $0.4 million to $6.923 million in Q1 2021 compared to Q1 2020, driven by higher billable AUM [126]. - Noninterest expense for the quarter was $34.5 million, compared to $32.9 million in the same quarter of the previous year, reflecting increased operational costs [117]. Asset Quality - The company reported a decrease in nonperforming assets from $18.2 million in Q1 2020 to $11.9 million in Q1 2021, indicating improved asset quality [121]. - The total allowance for credit losses (ACL) related to loans was $23,180,000 as of March 31, 2021, down from $24,200,000 at the end of 2020 [156]. - The total amount of nonaccrual loans was $26,993,000, which accounted for 0.53% of total loans [151]. - The provision for credit losses for the three months ended March 31, 2021, was $(1,212,000), indicating a reduction in the allowance [156]. - The company experienced a decrease in the ACL due to loan write-downs and charge-offs, reflecting changes in the economic conditions [157]. Economic Outlook - The company anticipates continued improvements in commercial and consumer activity as the U.S. economy recovers from the COVID-19 pandemic [111]. - The CARES Act and subsequent relief packages totaling $4.8 trillion have materially impacted the company's operations and financial results [112]. Capital and Dividends - The CET1 capital ratio was 11.13% as of March 31, 2021, exceeding the regulatory requirement of 4.50% [174]. - The total risk-based capital ratio was 11.71% as of March 31, 2021, above the required 8.00% [174]. - The Company paid a quarterly cash dividend of $0.09 per common share in Q1 2021, with intentions to continue future dividends [179]. - The Company paid $12.5 million in dividends ($0.28 per share) in 2020, adhering to regulatory restrictions on dividend payments [179]. Operational Adjustments - Approximately 30% of corporate employees are still working remotely under the Pandemic Response Business Continuity Plan, with additional safety costs offset by reduced expenses in other areas [114]. - Noninterest expense in Banking rose from $26.2 million in Q1 2020 to $28.6 million in Q1 2021, mainly due to higher compensation and benefits [131]. - The company reported a decrease in cash and cash equivalents by $162 million during Q1 2021, primarily due to funding of loans and investments in securities [137].