FB Financial (US:FBK)2022-05-09 16:00Financial Performance - Total interest income for Q1 2022 was $95,127,000, compared to $94,785,000 in Q1 2021, representing a 0.4% increase[13] - Net interest income after provisions for credit losses was $92,429,000 in Q1 2022, down from $96,430,000 in Q1 2021, a decrease of 4.1%[13] - Net income applicable to FB Financial Corporation for Q1 2022 was $35,236,000, a decline of 33.6% from $52,874,000 in Q1 2021[13] - Earnings per share (EPS) for Q1 2022 was $0.74, down from $1.12 in Q1 2021, reflecting a decrease of 33.9%[13] - Total noninterest income for Q1 2022 was $41,392,000, compared to $66,730,000 in Q1 2021, indicating a significant decline of 38%[13] - Total noninterest expenses decreased to $89,272,000 in Q1 2022 from $94,698,000 in Q1 2021, a reduction of 5.7%[13] - Other comprehensive loss for Q1 2022 was $(77,402,000), compared to $(11,537,000) in Q1 2021, indicating a significant increase in losses[15] Credit Losses and Provisions - Provision for credit losses was $(6,129,000) in Q1 2022, compared to $(11,632,000) in Q1 2021, showing a reduction in provisions by 47.4%[13] - The provision for credit losses was $(6,129,000) for the three months ended March 31, 2022, compared to $(11,632,000) for the same period in 2021, indicating a reduction in expected credit losses[41] - The allowance for credit losses decreased to $120,049 thousand as of March 31, 2022, from $125,559 thousand as of December 31, 2021, reflecting a reduction of approximately 4.0%[39] - The company reported recoveries of loans previously charged-off amounting to $1,198,000 for the three months ended March 31, 2022[41] Cash Flow and Investments - The net cash provided by operating activities for the three months ended March 31, 2022, was $288,148,000, compared to a net cash used of $(172,182,000) in the same period of 2021[19] - The net cash used in investing activities was $(477,754,000) for the three months ended March 31, 2022, compared to a net cash provided of $14,842,000 in the same period of 2021[19] - The net cash provided by financing activities was $135,177,000 for the three months ended March 31, 2022, a significant decrease from $734,575,000 in the same period of 2021[19] - Cash and cash equivalents at the end of the period were $1,743,311,000, down from $1,895,133,000 at the end of the same period in 2021[19] Loans and Loan Quality - Total loans outstanding as of March 31, 2022, reached $8,004,976 thousand, an increase from $7,604,662 thousand as of December 31, 2021, representing a growth of approximately 5.2%[39] - The net loans as of March 31, 2022, were $7,884,927 thousand, up from $7,479,103 thousand at the end of 2021, indicating a net increase of about 5.4%[39] - The company has shown a strong performance in the residential mortgage sector, with a total of $1,270,467,000 in loans[53] - The total amount of loans current on payments and accruing interest was $7,530,909 as of March 31, 2022[56] Derivatives and Hedging - The company has entered into designated cash flow hedges to hedge interest rate exposure on floating rate subordinated debentures amounting to $30.9 million[250] - Interest rate swap contracts were designated at fair value hedges to hedge interest rate exposure on subordinated debt issuance of $97.4 million[250] - The company utilizes derivative financial instruments to mitigate interest rate risk exposure and facilitate customer needs[247] Capital and Equity - The Company met all capital adequacy requirements as of March 31, 2022, under U.S. Basel III Capital Rules[120] - Total Capital to risk-weighted assets for FB Financial Corporation was $1,456,669, representing a ratio of 14.2% as of March 31, 2022[123] - Tier 1 Capital to risk-weighted assets for FB Financial Corporation was $1,264,358, with a ratio of 12.3% as of March 31, 2022[123] - Common Equity Tier 1 Capital to risk-weighted assets for FB Financial Corporation was $1,234,358, reflecting a ratio of 12.0% as of March 31, 2022[123] Restructuring and Strategic Changes - The company expects to incur total pre-tax restructuring charges of approximately $11,000 to $13,000 due to the discontinuation of its Direct-to-Consumer channel, which accounted for 43.4% of total interest rate lock volume in Q1 2022[27] - The Mortgage segment's restructuring includes the discontinuation of the Direct-to-Consumer delivery channel, which accounted for 43.4% of total interest rate lock volume in Q1 2022[115] Tax and Deferred Assets - The Company’s effective tax rate for the three months ended March 31, 2022, was 20.9%, down from 22.8% for the same period in 2021[75] - As of March 31, 2022, the net deferred tax assets amounted to $9,748,000, compared to a liability of $6,820,000 as of December 31, 2021[77]