Simmons First National (SFNC) - 2021 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company reported consolidated net income of $9.1 million for Q4 2021, with fully diluted earnings per share (EPS) of $0.51, compared to $12.5 million and EPS of $0.71 in Q4 2020 [22][11] - Non-GAAP consolidated net income for Q4 2021 was $9.8 million, with fully diluted EPS of $0.55, excluding elevated professional services costs related to the anticipated merger [23] - The tax equivalent net interest margin for Q4 2021 was 3.89%, down from 4% in Q3 2021, reflecting an 11 basis point decrease [27] Business Line Data and Key Metrics Changes - The loan portfolio grew by 24.3% on an annualized basis, excluding the impact of PPP loan forgiveness, with significant growth in C&I and construction loans at 77% and 40% respectively [14] - Non-interest income increased to $4.3 million in Q4 2021, up from $3.3 million in Q3 2021, primarily due to an increase in gains on the sale of SBA loans [25] Market Data and Key Metrics Changes - Total deposits reached $2.8 billion, an increase of $111.8 million or 16.6% annualized from Q3 2021, and an increase of $323.3 million or 13.2% over Q4 2020 [18] - Non-interest-bearing deposits increased by $36.1 million or 18.8% annualized from Q3 2021, making up 28.9% of total deposits [18] Company Strategy and Development Direction - The upcoming merger with Simmons First National Corp. is viewed as a new chapter for the company, aimed at further growth in Texas markets and enhancing the performance of its bankers [13][31] - The company aims to leverage a larger balance sheet to increase lending capacity and access a broader array of products and services [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued success post-merger, highlighting the team's performance and commitment to quality over the past 13 years [32] - The company anticipates a higher net interest margin in the future due to a shift in asset mix from lower-yielding cash into loans [17] Other Important Information - The provision for loan losses for Q4 was $970,000, increasing the allowance to $16.4 million or 71 basis points of total loans outstanding [28] - The company has significant liquidity sources, including a $50 million line of credit and Federal Home Loan Bank availability of $841.9 million [22] Q&A Session Summary - There were no questions during the Q&A session, indicating that many inquiries may have been addressed in the press release or during the presentation [33][34]