Byline Bancorp(BY) - 2023 Q3 - Quarterly Report

Financial Performance - For the three months ended September 30, 2023, the company reported a net income of $28.2 million, an increase of $5.6 million compared to $22.7 million for the same period in 2022[244]. - The annual return on average assets for the nine months ended September 30, 2023, was 1.34%, up from 1.26% in the same period of 2022[233]. - The company reported net income available to common stockholders of $78.3 million for the nine months ended September 30, 2023, compared to $65.1 million for the same period in 2022[248]. - The return on average stockholders' equity for the three months ended September 30, 2023, was 12.11%, compared to 11.74% for the same period in 2022[233]. Assets and Liabilities - Total consolidated assets as of September 30, 2023, were $8.9 billion, with total gross loans and leases outstanding at $6.6 billion[249]. - As of September 30, 2023, total deposits were $7.0 billion, reflecting the company's strong deposit base[249]. - The balance of investment securities at the end of the period is $281,000, a decrease from $666,000 at the beginning of the period, reflecting a change in fair value of $(67,000)[262]. - The balance of servicing assets at the end of the period is $19,743, a decrease from $21,127 in the previous year[262]. Income and Dividends - The company declared dividends on common shares of $3.9 million for the three months ended September 30, 2023, compared to $3.4 million for the same period in 2022[245]. - Net interest income increased by $23.6 million and $55.1 million for the three and nine months ended September 30, 2023, respectively, primarily due to higher yields on loans and leases[244]. Acquisitions and Market Position - The acquisition of Inland Bancorp, Inc. was completed on July 1, 2023, with 5,932,323 shares of common stock issued in connection with the acquisition[236]. - The company was the fifth most active SBA lender in the country and the most active 7(a) and 504 lender in Illinois for the fiscal year ended September 30, 2023[242]. Derivative Instruments and Risk Management - The notional amounts of derivative assets are $650,000, with a fair value of $47,488 for assets and $1,633 for liabilities[264]. - The Company has a bilateral agreement with each swap counterparty to fully collateralize fluctuations in derivative values with cash or securities[265]. - The aggregate interest rate risk exposure is monitored within board-approved policy limits, with results of simulation analysis being hypothetical[516]. - The Company has agreements with derivative counterparties that include cross-default provisions, which could lead to default on derivative obligations if the Company defaults on any indebtedness[266]. - The weighted average remaining maturity of derivative instruments is 3.2 years[264]. - The net interest income simulation model evaluates potential changes in net interest income under various interest rate scenarios, with results not intended as forecasts but for planning asset-liability management strategies[515].