QCR (US:QCRH)2023-08-08 15:46Financial Performance - Net income for the three months ended June 30, 2023, was $28,425 thousand, a 86.1% increase compared to $15,242 thousand for the same period in 2022[13] - Basic earnings per common share increased to $1.70 for the three months ended June 30, 2023, compared to $0.88 for the same period in 2022, reflecting a significant growth of 93.2%[13] - Net income for the six months ended June 30, 2023, was $55,582,000, up from $38,866,000 in 2022, reflecting a 42.9% growth[16] - Basic earnings per common share increased to $3.32 in 2023 from $2.36 in 2022, a growth of 40.6%[15] - Comprehensive income for the six months ended June 30, 2023, was $58,571,000, compared to a loss of $12,760,000 in 2022[16] - Net income for the three months ended June 30, 2023, was $28,425,000, a 86.2% increase from $15,242,000 in the same period of 2022[81] Asset and Liability Growth - Total assets increased to $8,226,673 thousand as of June 30, 2023, up from $7,948,837 thousand at December 31, 2022, representing a growth of 3.5%[11] - The total liabilities increased to $7,403,984 thousand as of June 30, 2023, from $7,176,113 thousand at December 31, 2022, representing a growth of 3.2%[11] - Total deposits increased to $6,606,720 thousand as of June 30, 2023, compared to $5,984,217 thousand at December 31, 2022, an increase of 10.4%[11] - Cash and due from banks increased to $84,084 thousand as of June 30, 2023, compared to $59,723 thousand at December 31, 2022, a rise of 40.9%[11] Income and Expense Analysis - Total noninterest income rose to $32,520 thousand for the three months ended June 30, 2023, up from $22,782 thousand in the same period of 2022, marking a 42.7% increase[13] - Total noninterest expenses increased to $98,512,000 in 2023 from $92,573,000 in 2022, a rise of 6.4%[15] - Interest payments increased significantly to $78,966,000 in 2023 from $13,779,000 in 2022, reflecting a rise in interest expenses[20] - The company reported a total interest and dividend income of $98,377 thousand for the three months ended June 30, 2023, compared to $68,205 thousand in the same period of 2022, an increase of 44.2%[13] Credit Quality and Provisions - Provision for credit losses decreased to $3,606 thousand for the three months ended June 30, 2023, down from $11,200 thousand in the same period of 2022, indicating improved credit quality[13] - The company reported a provision for credit losses of $7,534,000 in 2023, slightly down from $8,284,000 in 2022, a decrease of 9.0%[15] - The allowance for credit losses decreased to $85.8 million as of June 30, 2023, from $87.7 million as of December 31, 2022[49] - The percentage of current loans in the total loan/lease portfolio was 99.30% as of June 30, 2023, compared to 99.71% as of December 31, 2022[51] Loan and Lease Portfolio - The loan/lease portfolio totaled $6.379 billion as of June 30, 2023, an increase from $6.139 billion as of December 31, 2022, representing a growth of approximately 3.9%[49] - The company held $1.308 billion in construction and land development loans as of June 30, 2023, up from $1.192 billion at the end of 2022, indicating a growth of approximately 9.7%[49] - The total for construction and land development loans was $16,507 thousand, with all loans classified as performing[66] - The total for CRE - owner occupied loans is $609,717 thousand, with a mix of performing and nonperforming loans[65] Capital and Ratios - The Company maintained a total risk-based capital ratio of 14.69% as of June 30, 2023, exceeding the minimum requirement of 8.00%[98] - Tier 1 risk-based capital ratio was reported at 10.38% as of June 30, 2023, above the required minimum of 6.00%[98] - The total risk-based capital ratio as of December 31, 2022, was 14.28%, exceeding the required minimum of 8.00%[99] Interest Rate Management - The Company has $300 million in deposits hedged against rising interest rates with interest rate caps, with an initial premium of $3.5 million paid[74] - The interest rate collar for loans has a notional amount of $50,000 thousand with a cap strike rate of 4.40% and a floor strike rate of 2.44%[74] - The total balance of interest rate swaps decreased to $159,172 thousand as of June 30, 2023, from $166,614 thousand as of December 31, 2022[73] Noninterest Income and Fees - Total noninterest income increased by 51.9% to $58.4 million for the first half of 2023 compared to $38.4 million in the same period of 2022, with significant contributions from capital markets revenue and trust fees[152] - Capital markets revenue surged by 72.9% to $22.5 million in the second quarter of 2023 compared to $13.0 million in the same period of 2022[152] - Trust fees increased by 14% in the second quarter of 2023 compared to the same period in 2022, reflecting an increase in assets under management by $569.9 million in the second quarter[152] Operational Efficiency - The efficiency ratio (non-GAAP) improved to 58.01% for the quarter ended June 30, 2023, from 59.02% in the previous quarter and 66.01% a year ago[124] - Noninterest expense (GAAP) was $49.7 million for the quarter ended June 30, 2023, compared to $48.8 million in the previous quarter and $54.2 million a year ago[124] Market and Economic Conditions - The Company aims to generate loan and lease growth of 9% per year, funded by core deposits, as part of its long-term strategic financial metrics[109] - The Company plans to continue growing quality loans and leases while expanding its private placement tax-exempt securities portfolio to maximize yield and minimize risks[142]