First Internet Bancorp(US:INBK)2022-11-09 22:01Financial Performance - Net income for the three months ended September 30, 2022, was $8,436 thousand, down 30.1% from $12,090 thousand in the prior year[14]. - Basic earnings per share decreased to $0.89 for the three months ended September 30, 2022, compared to $1.22 for the same period in 2021, a decline of 27.0%[14]. - Net income for the nine months ended September 30, 2022, was $29.19 million, a decrease of 18.1% compared to $35.64 million for the same period in 2021[22]. - Basic earnings per share for the nine months ended September 30, 2022, was $3.04, down from $3.59 in 2021, reflecting a 15.3% decline[30]. - The company reported a total comprehensive loss of $(39,143) thousand as of September 30, 2022[177]. - In Q3 2022, net income was $8.4 million, or $0.89 per diluted share, a decrease of $3.7 million, or 30.2%, from Q3 2021[198]. - For the nine months ended September 30, 2022, net income was $29.2 million, down $6.4 million, or 18.1%, compared to the same period in 2021[200]. Asset and Loan Growth - Total assets increased to $4,264,424 thousand as of September 30, 2022, compared to $4,210,994 thousand at December 31, 2021, reflecting a growth of 1.3%[12]. - Net loans rose to $3,226,040 thousand, up from $2,859,821 thousand, representing an increase of 12.8% year-over-year[12]. - Total loans amounted to $3,255,906 thousand, an increase from $2,887,662 thousand as of December 31, 2021, representing a growth of approximately 12.8%[42]. - Total commercial loans reached $2,535,065 thousand, up from $2,363,863 thousand, indicating an increase of about 7.2%[42]. - Residential mortgage loans increased significantly to $337,565 thousand from $186,770 thousand, reflecting an increase of approximately 80.5%[42]. - The company reported a significant increase in investor commercial real estate loans, rising to $91,021 thousand from $28,019 thousand, a growth of approximately 225.5%[42]. Income and Expense Analysis - Total interest income for the three months ended September 30, 2022, was $39,099 thousand, a 18.5% increase from $33,034 thousand in the same period of 2021[14]. - Noninterest income for the three months ended September 30, 2022, was $4,316 thousand, down 44.8% from $7,813 thousand in the same period of 2021[14]. - Total noninterest expense increased to $17,995 thousand for the three months ended September 30, 2022, up from $14,451 thousand in the prior year, an increase of 24.0%[14]. - Noninterest expense increased by $9.9 million, or 22.1%, for the nine months ended September 30, 2022, compared to the same period in 2021[200]. Loan Loss Provisions - Provision for loan losses was $892 thousand for the three months ended September 30, 2022, compared to a reversal of $29 thousand in the same period of 2021[14]. - The provision for loan losses increased to $2.87 million in 2022 from $1.27 million in 2021, indicating a rise of 126.6%[22]. - The total allowance for loan losses increased to $29,866,000 as of September 30, 2022, compared to $28,000,000 at the same date in 2021, reflecting a year-over-year increase of approximately 6.67%[58]. - The provision charged to expense for the three months ended September 30, 2022, was $892,000, while the charge-offs amounted to $236,000, resulting in a net increase in the allowance[58]. Securities and Investments - As of September 30, 2022, the total fair value of the company's investments in securities was $541.0 million, approximately 96% of the AFS and HTM securities portfolios[35]. - The total available-for-sale securities amounted to $393.565 million, with unrealized losses of $55.351 million[32]. - The total held-to-maturity securities were valued at $169.977 million, with unrealized losses of $21.089 million[32]. - The company's portfolio consisted of 447 securities, with 438 in an unrealized loss position[35]. - The unrealized losses were primarily due to fluctuations in market interest rates after purchase[36]. Shareholder Equity and Dividends - Total shareholders' equity as of September 30, 2022, was $360.86 million, a decrease from $370.44 million as of September 30, 2021[20]. - The company declared dividends of $0.18 per share for the nine months ended September 30, 2022, totaling $1.74 million[22]. Capital and Debt Management - The Company issued $60.0 million aggregate principal amount of 3.75% Fixed-to-Floating Rate Subordinated Notes due 2031, which are intended to qualify as Tier 2 capital under regulatory guidelines[94]. - The Company redeemed the 2026 Notes in full on September 30, 2021, which had an aggregate principal amount of $25.0 million[91]. - The company has contracted capital expenditures of $69.2 million for the construction of its corporate headquarters and parking garage, with $6.1 million yet to be incurred as of September 30, 2022[113]. Market and Economic Conditions - The company expects to adopt the new credit loss standard on January 1, 2023, which may result in an increase in the allowance for loan and lease losses (ALLL)[185]. - The company has a working group focused on the implementation of the current expected credit losses (CECL) model, with model validation expected to be completed in Q4 2022[184]. - The company suspended the guidance on accounting for troubled debt restructurings (TDRs) related to COVID-19 under the CARES Act[186]. Miscellaneous - The company was incorporated in Indiana on September 15, 2005, and its banking operations commenced in 1999[191]. - The company has three wholly-owned subsidiaries providing various financial services, including public finance lending and real estate management[192].