QCR (US:QCRH)2023-05-09 18:42Financial Performance - Net income for Q1 2023 was $27,157 thousand, compared to $23,624 thousand in Q1 2022, marking an increase of 15.5%[15]. - Comprehensive income for Q1 2023 was $36,482,000, compared to a loss of $3,716,000 in Q1 2022[16]. - Total revenue for the three months ended March 31, 2023, was $120,059,000, an increase from $66,695,000 in the same period of 2022, representing an increase of approximately 80.4%[89]. - Net interest income for the three months ended March 31, 2023, was $56,810 thousand, up from $45,733 thousand in the same period of 2022, representing a year-over-year increase of 24.5%[15]. - Noninterest income for Q1 2023 was $25,842 thousand, an increase from $15,633 thousand in Q1 2022, reflecting a growth of 65.1%[15]. - Basic earnings per common share increased to $1.62 for Q1 2023, compared to $1.51 for Q1 2022, representing a growth of 7.3%[15]. - The company reported net income of $27.2 million and diluted EPS of $1.60 for Q1 2023, compared to $30.9 million and $1.81 in Q4 2022, and $23.6 million and $1.49 in Q1 2022[100]. - Adjusted net income (non-GAAP) for Q1 2023 was $28,024,000, down 10% from $31,129,000 in Q4 2022 but up 15% from $24,371,000 in Q1 2022[119]. Asset and Deposit Growth - Total assets increased to $8,036,904 thousand as of March 31, 2023, compared to $7,948,837 thousand as of December 31, 2022, reflecting a growth of 1.1%[12]. - Total deposits rose to $6,501,663 thousand as of March 31, 2023, from $5,984,217 thousand as of December 31, 2022, indicating a growth of 8.7%[12]. - The net increase in deposit accounts was $517,446,000 in Q1 2023, compared to a decrease of $83,083,000 in Q1 2022[18]. - The Company’s nonmaturity deposits totaled $5,288,242,000 as of March 31, 2023, reflecting a stable funding base[89]. - The Company added $497.5 million in short-term brokered deposits during the quarter to enhance liquidity and eliminate overnight borrowings from the FHLB[199]. Credit Quality and Allowance for Credit Losses - The allowance for credit losses decreased slightly to $86,573 thousand as of March 31, 2023, from $87,706 thousand as of December 31, 2022[12]. - The provision for credit losses was $3,928,000 in Q1 2023, compared to a benefit of $2,916,000 in Q1 2022[18]. - The company’s allowance for credit losses (ACL) on loans and leases was 1.43% of total gross loans/leases held for investment as of March 31, 2023, unchanged from December 31, 2022[135]. - The provision for credit losses totaled $2,458 thousand in Q1 2023, compared to a charge-off of $2,275 thousand[185]. - Nonperforming assets (NPAs) increased to $23.0 million as of March 31, 2023, up $14.1 million from December 31, 2022, and up $20.3 million from March 31, 2022[195]. Loan Portfolio and Performance - The company reported a total of $6,190,022 thousand in gross loans/leases receivable as of March 31, 2023, down from $6,138,871 thousand as of December 31, 2022[12]. - The total loan/lease portfolio amounted to $6,190.0 million, an increase from $6,138.9 million as of December 31, 2022, reflecting a growth of approximately 0.84%[46]. - The construction and land development loan portfolio totaled $1,208,185 thousand, with a 19% share of total loans/leases[181]. - Total loans/leases increased by 3.3% on an annualized basis in Q1 2023, reaching $6,190,022 thousand[177]. - The company aims to grow quality loans and leases while expanding its private placement tax-exempt securities portfolio to maximize yield[130]. Capital Adequacy and Regulatory Compliance - The Company and its subsidiary banks met all capital adequacy requirements as of March 31, 2023, ensuring compliance with regulatory standards[91]. - Total risk-based capital for the Company was $1,078,343 thousand with a ratio of 14.68% as of March 31, 2023, exceeding the required 8.00%[93]. - Tier 1 risk-based capital was reported at $754,221 thousand with a ratio of 10.27% as of March 31, 2023, also above the required 6.00%[93]. - Common equity Tier 1 capital stood at $705,587 thousand with a ratio of 9.60% as of March 31, 2023, surpassing the minimum requirement of 4.50%[93]. Interest Rate Management - The company has $300 million in deposits hedged against rising interest rates, with an initial premium of $3.5 million paid for interest rate caps[68]. - The fair value of interest rate caps as of March 31, 2023, is $6,714,000, a decrease from $8,327,000 as of December 31, 2022, indicating a decline of about 19.4%[68]. - The company has entered into interest rate swaps with a total notional amount of $300 million, with liabilities recorded at $(29,978,000) as of March 31, 2023, down from $(35,631,000) at the end of 2022, reflecting an improvement of approximately 15.7%[69]. - The company utilizes interest rate collars to manage future interest rate exposure on variable rate loans, with a notional amount of $50,000,000 and a fair value of $(57,000) as of March 31, 2023[69]. Noninterest Expense and Efficiency - Noninterest expense totaled $48.8 million in Q1 2023, an increase of $10.5 million, or 27%, compared to Q1 2022[113]. - The efficiency ratio (non-GAAP) improved to 59.02% in Q1 2023 from 57.50% in Q4 2022, but worsened from 62.45% in Q1 2022[119]. - Total noninterest expense increased by 27.3% year-over-year in Q1 2023, with salaries and employee benefits rising by 35.5% due to the GFED acquisition[155][156]. Market Presence and Strategic Initiatives - The acquisition of GFED, the holding company of GB, was completed on April 1, 2022, and the merged entity is now named Guaranty Bank[25]. - The combined bank from the merger is expected to enhance market presence and operational efficiency in the Springfield area[25]. - The company has not invested in private mortgage-backed securities or pooled trust preferred securities, focusing solely on government-sponsored or guaranteed securities[32].