First Busey(US:BUSE)2022-05-04 16:00Financial Performance - First Busey reported net income of $28.439 million for the three months ended March 31, 2022, compared to $29.926 million for the previous quarter and $37.816 million for the same period last year [196]. - Diluted earnings per common share were $0.51 for Q1 2022, down from $0.53 in Q4 2021 and $0.69 in Q1 2021 [196]. - Adjusted net income for Q1 2022 was $29.104 million, compared to $34.277 million in Q4 2021 and $38.065 million in Q1 2021 [196]. - Noninterest income totaled $35.8 million, reflecting a 13.8% increase from $31.4 million in the same period last year [217]. - Wealth management fees increased by 25.4% to $15,779 compared to $12,584 in the prior year [217]. - The efficiency ratio was 63.0% for the three months ended March 31, 2022, compared to 54.7% for the same period in 2021 [234]. Asset and Deposit Growth - Average interest-earning assets increased by 20.0% to $11,703,947 compared to $9,752,294 in the previous year [209]. - Total average deposits rose by 21.7% to $10,617,438 from $8,722,458 year-over-year [209]. - Total deposits decreased by 1.6% to $10.6 billion as of March 31, 2022, compared to $10.8 billion as of December 31, 2021 [264]. Loan Portfolio - Portfolio loans, net increased by 1.2% to $7.18 billion as of March 31, 2022, compared to $7.10 billion as of December 31, 2021 [239]. - The loan to deposit ratio was 68.7% as of March 31, 2022 [213]. - Core loans reached $7,241,104 in March 2022, up from $7,114,040 in December 2021, while portfolio loans increased to $7,272,873 [298]. - Excluding PPP loans, commercial balances increased by $80.3 million since December 31, 2021 [252]. Non-Performing Loans and Credit Quality - Non-performing loans are classified based on payment obligations, with management actively monitoring loan performance [255]. - Non-performing loan balances decreased by 24.7% to $12.7 million as of March 31, 2022, compared to $16.9 million as of December 31, 2021 [259]. - The Allowance for Credit Losses (ACL) was $88.213 million as of March 31, 2022, with a ratio of ACL to portfolio loans at 1.21% [257]. - The ACL to non-performing loans ratio improved to 695.41% as of March 31, 2022, compared to 521.52% as of December 31, 2021 [259]. Interest Income and Margin - The net interest margin decreased to 2.45% from 2.72% year-over-year [210]. - Net interest income for March 31, 2022, was $70,056 thousand, a slight decrease from $70,508 thousand for the three months ended December 31, 2021 [289]. - Reported net interest margin for March 31, 2022, was 2.45%, an increase from 2.36% in the previous quarter [289]. Operational Changes and Acquisitions - The company completed the acquisition of CAC, enhancing its operational capabilities and resetting the baseline for future financial performance [195]. - Non-operating pre-tax adjustments for Q1 2022 included $0.8 million in acquisition-related expenses [198]. Economic and Market Conditions - The company anticipates potential impacts from economic factors such as inflation, supply chain constraints, and changes in interest rates [300]. - The interest rate risk affecting First Busey is primarily due to movements in interest rates, with minimal impact from foreign currency exchange rate risk and commodity price risk [316]. Accounting and Financial Reporting - The company has established critical accounting estimates that may affect financial condition and results of operations, which are reviewed with the Audit Committee [302]. - Goodwill represents the excess of purchase price over the fair value of net assets acquired, and is assessed for impairment annually [310].