BANCFIRST CORPORATION REPORTS FIRST QUARTER EARNINGS

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BancFirst reported net income of $50.3 million for Q1 2024, a decrease from the previous year. Net interest income and margin declined, while noninterest income and expenses increased. Total assets, loans, and deposits showed growth, with strong asset quality. CEO mentioned positive signs in loan and deposit growth despite economic concerns.

Positive

• Net income for Q1 2024 was $50.3 million, down from $57.5 million in Q1 2023.
• Net interest income decreased to $106.1 million in Q1 2024 from $109.2 million in Q1 2023.
• Noninterest income declined to $44.9 million in Q1 2024 from $47.8 million the previous year.
• Total assets increased to $12.6 billion at the end of Q1 2024.
• Loan volume grew to $7.8 billion, and deposits reached $10.9 billion, showing positive growth.
• Asset quality remained strong, with nonaccrual loans at 0.54% of total loans.

Negative

• Net interest margin decreased to 3.70% in Q1 2024 from 3.89% in Q1 2023.
• Provision for credit losses increased to $4.0 million in Q1 2024 from $2.3 million in Q1 2023.
• Noninterest expenses rose to $82.8 million in Q1 2024 from $80.3 million in Q1 2023.
• Net charge-offs were $3.5 million for Q1 2024, a significant increase from $290,000 in Q1 2023.

Financial Analyst

Examining the quarterly report, there's a clear reduction in net income, a move from $57.5 million to $50.3 million. This is a notable deviation from the previous year's performance, which may concern shareholders looking for growth stability. The net interest margin has also contracted from 3.89% to 3.70%, reflecting a tighter spread between interest income generated and the interest paid to depositors. This squeeze could signal rising funding costs or competitive pressures on lending rates. With the provision for credit losses increasing from $2.3 million to $4.0 million, it suggests a cautious approach to potential bad debts, which may resonate with risk-averse investors amid economic uncertainties. However, the effective tax rate has dipped slightly, providing a thin silver lining. Asset growth is positive, but the key question for investors is whether this can translate into improved returns, especially in a climate where the Federal Reserve's interest rate policy might tighten further.

Banking Sector Analyst

The Durbin Amendment's influence is evident, with a $5.3 million reduction in interchange fees affecting noninterest income. This legislation often hits smaller financial institutions harder, given their reliance on fee income. BancFirst's increment in noninterest expenses, primarily due to higher staff costs, suggests investment in human capital or possibly wage inflation, which investors should watch in terms of cost management efficiency. Asset quality is a strength, with nonaccrual loans at a modest 0.54% of total loans, an increase from the prior year-end but still within a manageable range. The relatively stable allowance for credit losses ratio indicates the bank's consistent approach to covering potential loan defaults. The increase in deposits and loans is promising, but investors should measure this against the broader economic context and interest rate forecasts for a comprehensive risk assessment.

Market Research Analyst

From a market perspective, BancFirst's performance offers a mixed bag. The company operates in a competitive banking landscape where regional dynamics influence business prospects. The expansion of assets and ongoing growth in loans and deposits are indicators of healthy operational activity, but market participants will scrutinize the bank’s strategies for yielding net interest margin, particularly in a rising rate environment. The mention of stabilization in deposit mix could be a strategic advantage if it leads to improved profitability. Understanding regional market factors, such as economic growth rates in Oklahoma and Texas where BancFirst operates, is critical for assessing the potential for BancFirst's further expansion and corresponding stock performance.

OKLAHOMA CITY, April 18, 2024 /PRNewswire/ -- BancFirst Corporation (NASDAQ GS: BANF) reported net income of $50.3 million, or $1.50 per diluted share, for the first quarter of 2024 compared to net income of $57.5 million, or $1.72 per diluted share, for the first quarter of 2023. The Company's net interest income for the first quarter of 2024 decreased to $106.1 million from $109.2 million for the same period in 2023. Net interest income was negatively impacted by increases in volume and rates on interest bearing deposits, partially offset by higher loan volume. Net interest margin for the first quarter of 2024 was 3.70% compared to 3.89% for the first quarter of 2023. The Company recorded a provision for credit losses of $4.0 million in the first quarter compared to $2.3 million for the first quarter of 2023.

Noninterest income for the quarter totaled $44.9 million compared to $47.8 million last year. The decrease in noninterest income was primarily due to an approximate $5.3 million reduction of interchange fees related to the impact of the Durbin Amendment. Trust revenue, sweep fees and insurance commissions all each increased when compared to last year.

Noninterest expense for the quarter increased to $82.8 million compared to $80.3 million in the same quarter last year. The increase in noninterest expense was primarily related to growth in salaries and employee benefits of $2.3 million.

The Company's effective tax rate for the period was 21.6% compared to 22.6% for the first quarter of 2023.

At March 31, 2024, the Company's total assets were $12.6 billion, an increase of $230.4 million from December 31, 2023. Loans grew $127.7 million, totaling $7.8 billion at March 31, 2024. Deposits totaled $10.9 billion, an increase of $209.5 million from December 31, 2023. Sweep accounts were $4.6 billion at March 31, 2024, up $224.2 million from December 31, 2023. The Company's total stockholders' equity was $1.5 billion, an increase of $35.4 million over December 31, 2023.

Asset quality remained strong as nonaccrual loans totaled $42.0 million, representing 0.54% of total loans at March 31, 2024 compared to 0.32% at year-end 2023. The allowance for credit losses to total loans was 1.25% at March 31, 2024 virtually unchanged from year-end. Net charge-offs were $3.5 million for the quarter compared to $290,000 for the first quarter of 2023.

BancFirst Corporation CEO David Harlow commented, "The Company reported a solid quarter fueled by loan growth, deposit growth, and early signs of a stabilization in our deposit mix. Asset quality remained strong and our CECL reserve percentage was essentially flat as our guarded outlook on the economy has not changed materially. Recent inflation data has been higher than anticipated causing the Federal Reserve to signal higher rates for longer which will impact everyone including banks."

BancFirst Corporation (the Company) is an Oklahoma based financial services holding company. The Company operates three subsidiary banks, BancFirst, an Oklahoma state-chartered bank with 106 banking locations serving 59 communities across Oklahoma, Pegasus Bank, a Texas state-chartered bank with three banking locations in the Dallas Metroplex area and Worthington Bank, a Texas state-chartered bank with three locations in the Fort Worth Metroplex area, one location in Arlington Texas and one location in Denton Texas. More information can be found at www.bancfirst.bank.

The Company may make forward-looking statements within the meaning of Section 27A of the securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 with respect to earnings, credit quality, corporate objectives, interest rates and other financial and business matters. Forward-looking statements include estimates and give management's current expectations or forecasts of future events.  The Company cautions readers that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, including economic conditions, the performance of financial markets and interest rates; legislative and regulatory actions and reforms; competition; as well as other factors, all of which change over time.  Actual results may differ materially from forward-looking statements.

BancFirst Corporation
Summary Financial Information
(Dollars in thousands, except per share and share data - Unaudited)
		2024		2023		2023		2023		2023
		1st Qtr		4th Qtr		3rd Qtr		2nd Qtr		1st Qtr
Condensed Income Statements:
Net interest income		$                  106,104		$                  105,066		$                  104,308		$                  105,926		$                  109,156
Provision for credit losses		4,015		-		2,312		2,824		2,322
Noninterest income:
Trust revenue		5,088		5,106		4,866		4,590		4,222
Service charges on deposits		16,428		16,841		17,027		22,268		21,231
Securities transactions		(267)		(1,364)		(361)		110		(213)
Income from sales of loans		491		512		734		757		604
Insurance commissions		9,455		7,220		8,429		6,225		8,741
Cash management		8,651		7,878		8,177		7,927		6,734
Other		5,054		8,964		5,577		6,097		6,509
Total noninterest income		44,900		45,157		44,449		47,974		47,828
Noninterest expense:
Salaries and employee benefits		51,528		50,731		50,200		49,803		49,252
Occupancy expense, net		5,206		5,439		5,487		5,118		4,983
Depreciation		4,556		4,560		4,685		4,769		4,643
Amortization of intangible assets		886		887		885		880		880
Data processing services		2,616		2,224		1,820		2,217		2,107
Net expense from other real estate owned		2,202		7,870		2,720		2,889		2,459
Marketing and business promotion		2,256		2,653		2,034		1,900		2,527
Deposit insurance		1,438		1,332		1,419		1,463		1,613
Other		12,091		14,120		11,965		12,071		11,853
Total noninterest expense		82,779		89,816		81,215		81,110		80,317
Income before income taxes		64,210		60,407		65,230		69,966		74,345
Income tax expense		13,876		11,473		14,242		14,956		16,812
Net income		$                    50,334		$                    48,934		$                    50,988		$                    55,010		$                    57,533
Per Common Share Data:
Net income-basic		$                        1.53		$                        1.48		$                        1.55		$                        1.67		$                        1.75
Net income-diluted		1.50		1.46		1.52		1.64		1.72
Cash dividends declared		0.43		0.43		0.43		0.40		0.40
Common shares outstanding		32,966,678		32,933,018		32,921,393		32,939,256		32,899,493
Average common shares outstanding -
Basic		32,947,983		32,926,326		32,937,149		32,920,497		32,892,857
Diluted		33,513,412		33,483,691		33,539,389		33,467,254		33,462,379
Performance Ratios:
Return on average assets		1.63 %		1.58 %		1.68 %		1.85 %		1.90 %
Return on average stockholders' equity		13.96		13.98		14.93		16.59		18.31
Net interest margin		3.70		3.67		3.73		3.87		3.89
Efficiency ratio		54.82		59.79		54.60		52.70		51.16

 

BancFirst Corporation
Summary Financial Information
(Dollars in thousands, except per share and share data - Unaudited)
		2024		2023		2023		2023		2023
		1st Qtr		4th Qtr		3rd Qtr		2nd Qtr		1st Qtr
Balance Sheet Data:
Total assets		$ 12,602,425		$ 12,372,042		$ 12,114,602		$ 12,020,265		$ 12,332,105
Interest-bearing deposits with banks		2,341,604		2,172,001		2,134,081		2,188,004		2,623,565
Debt securities		1,534,651		1,555,095		1,525,448		1,570,620		1,618,233
Total loans		7,787,857		7,660,134		7,476,474		7,307,475		7,124,831
Allowance for credit losses		(97,267)		(96,800)		(97,776)		(96,920)		(94,760)
Deposits		10,909,621		10,700,122		10,534,171		10,475,180		10,610,103
Stockholders' equity		1,469,312		1,433,891		1,370,584		1,340,791		1,310,882
Book value per common share		44.57		43.54		41.63		40.70		39.85
Tangible book value per common share (non-GAAP)(1)		38.56		37.50		35.56		34.62		33.73
Balance Sheet Ratios:
Average loans to deposits		71.97 %		70.52 %		70.61 %		69.85 %		64.54 %
Average earning assets to total assets		92.56		92.42		92.39		92.23		92.52
Average stockholders' equity to average assets		11.65		11.30		11.28		11.17		10.36
Asset Quality Data:
Past due loans		$          6,332		$          9,542		$        12,575		$          8,799		$          7,258
Nonaccrual loans (3)		41,996		24,573		16,676		18,047		17,649
Other real estate owned and repossessed assets		35,116		34,200		42,782		41,612		38,874
Nonaccrual loans to total loans		0.54 %		0.32 %		0.22 %		0.25 %		0.25 %
Allowance to total loans		1.25		1.26		1.31		1.33		1.33
Allowance to nonaccrual loans		231.61		393.92		586.34		537.05		536.93
Net charge-offs to average loans		0.05		0.02		0.02		0.01		0.00
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)(2):
Stockholders' equity		$   1,469,312		$   1,433,891		$   1,370,584		$   1,340,791		$   1,310,882
Less goodwill		182,263		182,263		182,263		182,055		182,055
Less intangible assets, net		15,818		16,704		17,591		18,223		19,103
Tangible stockholders' equity (non-GAAP)		$   1,271,231		$   1,234,924		$   1,170,730		$   1,140,513		$   1,109,724
Common shares outstanding		32,966,678		32,933,018		32,921,393		32,939,256		32,899,493
Tangible book value per common share (non-GAAP)		$          38.56		$          37.50		$          35.56		$          34.62		$          33.73

(1)	Refer to the "Reconciliation of Tangible Book Value per Common Share (non-GAAP)" Table.
(2)	Tangible book value per common share is stockholders' equity less goodwill and intangible assets, net, divided by common shares outstanding. This amount is a non-GAAP financial measure but has been included as it is considered to be a critical metric with which to analyze and evaluate the financial condition and capital strength of the Company. This measure should not be considered a substitute for operating results determined in accordance with GAAP.
(3)	Government Agencies guarantee approximately $6.6 million of nonaccrual loans at March 31, 2024.

 

BancFirst Corporation
Consolidated Average Balance Sheets
And Interest Margin Analysis
Taxable Equivalent Basis
(Dollars in thousands - Unaudited)
		Three Months Ended
		March 31, 2024
				Interest		Average
		Average		Income/		Yield/
		Balance		Expense		Rate
ASSETS
Earning assets:
Loans		$        7,730,753		$           132,249		6.86	%
Securities – taxable		1,557,806		9,181		2.36
Securities – tax exempt		2,642		25		3.76
Interest bearing deposits with banks and FFS		2,212,788		30,316		5.50
Total earning assets		11,503,989		171,771		5.99
Nonearning assets:
Cash and due from banks		202,300
Interest receivable and other assets		804,575
Allowance for credit losses		(97,061)
Total nonearning assets		909,814
Total assets		$      12,413,803
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest bearing liabilities:
Money market and interest-bearing checking deposits		$        4,814,772		$             44,217		3.68	%
Savings deposits		1,056,727		9,003		3.42
Time deposits		1,027,039		11,193		4.37
Short-term borrowings		8,018		96		4.79
Subordinated debt		86,106		1,030		4.80
Total interest bearing liabilities		6,992,662		65,539		3.76
Interest free funds:
Noninterest bearing deposits		3,843,371
Interest payable and other liabilities		131,898
Stockholders' equity		1,445,872
Total interest free  funds		5,421,141
Total liabilities and stockholders' equity		$      12,413,803
Net interest income				$           106,232
Net interest spread						2.23	%
Effect of interest free funds						1.47	%
Net interest margin						3.70	%

 

View original content:https://www.prnewswire.com/news-releases/bancfirst-corporation-reports-first-quarter-earnings-302121542.html

SOURCE BancFirst

FAQ

What was BancFirst 's net income for the first quarter of 2024?

BancFirst reported a net income of $50.3 million for the first quarter of 2024, a decrease from the previous year.

How did BancFirst 's net interest income change in Q1 2024 compared to Q1 2023?

BancFirst 's net interest income decreased to $106.1 million in Q1 2024 from $109.2 million in Q1 2023.

What is the total assets value for BancFirst at the end of Q1 2024?

BancFirst 's total assets were $12.6 billion at the end of Q1 2024.

What was the percentage of nonaccrual loans to total loans at the end of Q1 2024?

Nonaccrual loans represented 0.54% of total loans at the end of Q1 2024 for BancFirst

Who is the CEO of BancFirst ?

BancFirst 's CEO is David Harlow.