Eagle Bancorp(US:EGBN)2022-02-28 16:00Financial Performance - Net income for 2021 was $176,691, compared to $132,217 in 2020, reflecting a year-over-year increase of 33.6%[294]. - Net income for 2021 was $176.7 million, a 33.5% increase from $132.2 million in 2020, with earnings per share rising to $5.53 from $4.09[299][300]. - Total revenue for 2021 was $364,899, slightly down from $367,258 in 2020, a decrease of 0.4%[294]. - The efficiency ratio for 2021 was 40.88%, compared to 39.25% in 2020, indicating a decline in operational efficiency[296]. - Noninterest expenses rose by 3% to $149.2 million in 2021 compared to $144.2 million in 2020, resulting in an efficiency ratio of 40.88%[306]. Asset and Loan Management - The Company reported total assets of approximately $11.8 billion, total loans of $7.1 billion, and total deposits of $10.0 billion as of December 31, 2021[271]. - Total assets increased to $11,847,310, up from $11,117,802 in 2020, representing a growth of 6.6%[294]. - Total loans amounted to $7,065,598 thousand, with $2,016,028 thousand due in one year or less, and $3,600,320 thousand due in over one to five years[388]. - Total loan balances decreased by 9% to $9.0 billion at December 31, 2021, with average loans down 8% compared to 2020[308]. - The loan portfolio composition shows that income-producing commercial real estate loans accounted for 48% of total loans, while owner-occupied commercial real estate loans represented 15%[377]. Credit Quality and Losses - The allowance for credit losses decreased to $74,965 from $109,579 in 2020, indicating a reduction of 31.5%[294]. - Nonperforming loans to total loans improved to 0.41% from 0.79% in 2020, showing a significant decrease of 48.1%[296]. - The provision for credit losses in 2021 was a reversal of $20.8 million, compared to a provision of $45.6 million in 2020, reflecting improved asset quality[304]. - The ACL represented 257% of nonperforming loans, an increase from 180% in 2020, indicating improved asset quality[390]. - The Company continues to monitor exposures in the Accommodation and Food Service industry, which represents 8.3% of the loan portfolio[386]. Deposits and Liquidity - Total deposits increased by 9% to $10.0 billion at December 31, 2021, up from $9.2 billion at the end of 2020[358]. - Noninterest bearing demand deposits increased to $3.3 billion, accounting for 33% of total deposits, up from $2.8 billion or 31% in 2020[434]. - The Bank had $7.4 billion in primary and secondary liquidity sources, deemed adequate for current and projected funding needs[453]. - The Bank's liquidity strategy includes maintaining a marketable investment portfolio to provide flexibility for significant liquidity needs[452]. - The Company had $1.7 billion in "IND" brokered deposits as of December 31, 2021, an increase from $1.3 billion in 2020[431]. Capital Position - The Company’s capital position remained strong in 2021, supported by good earnings and improved asset quality, allowing for multiple quarterly dividend increases[268]. - The ratio of common equity to total assets increased to 11.40% at December 31, 2021, up from 11.16% at the end of 2020[312]. - The total risk-based capital ratio was 16.15% at December 31, 2021, down from 17.04% at the end of 2020, reflecting changes in the investment portfolio and risk-weighted assets[360]. - The Company plans to invest an additional $2 million by the end of 2023 to enhance corporate governance and risk compliance[441]. - Management seeks to maintain a capital structure that supports anticipated asset growth and absorbs potential losses[454]. Economic Environment - The U.S. GDP growth for 2021 was 5.7%, a recovery from a 3.4% decrease in 2020 due to the COVID-19 pandemic[263]. - The unemployment rate in the U.S. ended 2021 at 3.9%, down from 6.7% at the end of 2020, indicating a recovery in employment[263]. - The ten-year U.S. Treasury rate averaged 1.45% in 2021, up from 0.88% in 2020, reflecting an increase in longer-term interest rates[264]. - The Washington, D.C. metropolitan area has shown resilience during the pandemic, supported by a stable public sector and increased government spending[266]. - The Company has a concentration in commercial real estate loans, with non-owner-occupied commercial real estate loans representing 320% of consolidated risk-based capital[380].