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TowneBank Reports Third Quarter 2024 Earnings

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TowneBank (NASDAQ: TOWN) reported Q3 2024 earnings of $42.95 million, or $0.57 per diluted share, compared to $44.86 million, or $0.60 per diluted share in Q3 2023. Total revenues increased 0.96% to $174.52 million. Total deposits grew 3.48% to $14.36 billion, while loans held for investment increased 2.14% to $11.41 billion compared to Q3 2023. Net interest margin was 2.90%, with noninterest income rising by $2.43 million driven by growth in residential mortgage banking and insurance commissions. The company maintained strong asset quality with nonperforming assets at 0.04% of total assets.

TowneBank (NASDAQ: TOWN) ha riportato per il terzo trimestre del 2024 un utile di 42,95 milioni di dollari, pari a 0,57 dollari per azione diluita, rispetto ai 44,86 milioni di dollari, o 0,60 dollari per azione diluita, nel terzo trimestre del 2023. I ricavi totali sono aumentati dello 0,96% a 174,52 milioni di dollari. I depositi totali sono cresciuti del 3,48% a 14,36 miliardi di dollari, mentre i prestiti detenuti per investimenti sono aumentati del 2,14% a 11,41 miliardi di dollari rispetto al terzo trimestre del 2023. Il margine di interesse netto era del 2,90%, con un reddito non da interessi in aumento di 2,43 milioni di dollari, sostenuto dalla crescita nel settore dei mutui residenziali e delle commissioni assicurative. L’azienda ha mantenuto una solida qualità degli attivi, con attività non performanti allo 0,04% del totale degli attivi.

TowneBank (NASDAQ: TOWN) reportó ganancias de 42,95 millones de dólares en el tercer trimestre de 2024, o 0,57 dólares por acción diluida, en comparación con 44,86 millones de dólares, o 0,60 dólares por acción diluida en el tercer trimestre de 2023. Los ingresos totales aumentaron un 0,96% a 174,52 millones de dólares. Los depósitos totales crecieron un 3,48% a 14,36 mil millones de dólares, mientras que los préstamos mantenidos para inversión aumentaron un 2,14% a 11,41 mil millones de dólares en comparación con el tercer trimestre de 2023. El margen de interés neto fue del 2,90%, con un ingreso no por intereses que aumentó en 2,43 millones de dólares impulsado por el crecimiento en banca hipotecaria residencial y comisiones de seguros. La empresa mantuvo una sólida calidad de activos con activos no productivos en el 0,04% del total de activos.

타운뱅크 (NASDAQ: TOWN)는 2024년 3분기 순이익이 4,295만 달러, 즉 희석주당 0.57달러를 기록했으며, 2023년 3분기에 비해 4,486만 달러, 즉 희석주당 0.60달러에 비해 감소했습니다. 총 수익은 0.96% 증가하여 1억 7,452만 달러에 달했습니다. 총 예치금은 3.48% 증가하여 1,436억 달러에 이르고, 투자용으로 보유한 대출은 2.14% 증가하여 1,141억 달러에 달했습니다. 순이자 마진은 2.90%였으며, 주택 담보 대출 및 보험 수수료의 성장에 힘입어 비이자 수익이 243만 달러 증가했습니다. 회사는 총 자산의 0.04%에 해당하는 비수익 자산을 유지하며 강력한 자산 품질을 유지했습니다.

TowneBank (NASDAQ: TOWN) a annoncé pour le troisième trimestre 2024 un bénéfice de 42,95 millions de dollars, soit 0,57 dollar par action diluée, contre 44,86 millions de dollars, soit 0,60 dollar par action diluée au troisième trimestre 2023. Les revenus totaux ont augmenté de 0,96% pour atteindre 174,52 millions de dollars. Les dépôts totaux ont crû de 3,48% pour s’élever à 14,36 milliards de dollars, tandis que les prêts détenus pour investissement ont augmenté de 2,14% pour atteindre 11,41 milliards de dollars par rapport au troisième trimestre 2023. La marge d’intérêt nette était de 2,90%, avec un revenu non d’intérêt en hausse de 2,43 millions de dollars, soutenue par la croissance dans le secteur du financement hypothécaire résidentiel et des commissions d’assurance. L’entreprise a maintenu une solide qualité d'actifs avec des actifs non performants représentant 0,04% du total des actifs.

TowneBank (NASDAQ: TOWN) berichtete für das dritte Quartal 2024 von einem Gewinn in Höhe von 42,95 Millionen Dollar, oder 0,57 Dollar pro verwässerter Aktie, im Vergleich zu 44,86 Millionen Dollar, oder 0,60 Dollar pro verwässerter Aktie im dritten Quartal 2023. Die Gesamterlöse stiegen um 0,96% auf 174,52 Millionen Dollar. Die Gesamteinlagen wuchsen um 3,48% auf 14,36 Milliarden Dollar, während die für Investitionen gehaltenen Kredite um 2,14% auf 11,41 Milliarden Dollar im Vergleich zum dritten Quartal 2023 zunahmen. Die Nettomarge betrug 2,90%, wobei das nichtzinsbezogene Einkommen um 2,43 Millionen Dollar zulegte, angetrieben durch das Wachstum im Bereich des Wohnimmobilienbankings und der Versicherungsprovisionen. Das Unternehmen hielt eine starke Asset-Qualität mit notleidenden Forderungen in Höhe von 0,04% der Gesamtaktiva aufrecht.

Positive
  • Total revenues increased 0.96% to $174.52 million
  • Total deposits grew 3.48% to $14.36 billion
  • Noninterest income increased by $2.43 million (4.06%)
  • Insurance commissions grew 8.20% to $25.73 million
  • Strong asset quality with nonperforming assets at only 0.04% of total assets
Negative
  • Net earnings decreased from $44.86M to $42.95M year-over-year
  • EPS declined from $0.60 to $0.57 compared to Q3 2023
  • Net interest income decreased by $0.78 million
  • Noninterest-bearing deposits decreased 3.99% to $4.27 billion
  • Property management fee revenue decreased 12.34% to $11.22 million

Insights

TowneBank's Q3 2024 results show mixed performance with some concerning trends. $42.95M earnings represent a 4.26% decline from Q3 2023, while core earnings per share dropped to $0.58 from $0.60. The declining noninterest-bearing deposits (-3.99% YoY) and compressed net interest margin at 2.90% signal ongoing funding cost pressures.

Notable strengths include total revenue growth of 0.96%, robust insurance commission growth (8.20%) and strong asset quality with nonperforming assets at just 0.04% of total assets. The announced Village Bank partnership could strengthen Richmond market presence, while maintaining the #1 market share position in their legacy market demonstrates competitive advantage.

The 1.08% loan loss allowance and 18.70x coverage of nonperforming loans indicate strong credit quality, though loan growth has been modest at 2.14% YoY.

SUFFOLK, Va., Oct. 23, 2024 (GLOBE NEWSWIRE) -- TowneBank (the "Company" or "Towne") (NASDAQ: TOWN) today reported earnings for the quarter ended September 30, 2024 of $42.95 million, or $0.57 per diluted share, compared to $44.86 million, or $0.60 per diluted share, for the quarter ended September 30, 2023.   Excluding certain items affecting comparability, core earnings (non-GAAP) were $43.39 million, or $0.58 per diluted share, in the current quarter compared to $44.88 million, or $0.60 per diluted share, for the quarter ended September 30, 2023.

"Our third quarter results continued to deliver increased net interest income and noninterest income contributions from our diverse business model which were in line with expectations. We remain committed to prudent balance sheet management strategies. We were also excited to announce our partnership with Village Bank which will meaningfully enhance our Richmond presence, which is core to our franchise future growth. Lastly, the recently released FDIC Deposit Market Share Report for 2024 continues to demonstrate the strength of our Main Street banking model and core deposit franchise, resulting in the #1 market share, or 30%, in our legacy Virginia Beach-Norfolk-Newport News, VA-NC MSA," said G. Robert Aston, Jr., Executive Chairman.

Highlights for Third Quarter 2024:

  • Total revenues were $174.52 million, an increase of $1.65 million, or 0.96%, compared to third quarter 2023. Noninterest income increased $2.43 million, driven by growth in residential mortgage banking income and insurance commissions. Partially offsetting the increase in noninterest income was a $0.78 million decline in net interest income.
  • Total deposits were $14.36 billion, an increase of $482.37 million, or 3.48%, compared to third quarter 2023. Total deposits increased 0.63%, or $90.58 million, in comparison to June 30, 2024, 2.52% on an annualized basis.
  • Noninterest-bearing deposits decreased 3.99%, to $4.27 billion, compared to third quarter 2023 and represented 29.71% of total deposits. Compared to the linked quarter, noninterest-bearing deposits decreased 0.84%.
  • Loans held for investment were $11.41 billion, an increase of $239.55 million, or 2.14%, compared to September 30, 2023, but a decrease of $39.23 million, or 0.34%, compared to June 30, 2024.
  • Annualized return on common shareholders' equity was 8.18% compared to 9.04% in third quarter 2023. Annualized return on average tangible common shareholders' equity (non-GAAP) was 11.54% compared to 13.11% in third quarter 2023.
  • Net interest margin was 2.90% for the quarter and tax-equivalent net interest margin (non-GAAP) was 2.93%, including purchase accounting accretion of 3 basis points, compared to the prior year quarter net interest margin of 2.95% and tax-equivalent net interest margin (non-GAAP) of 2.98%, including purchase accounting accretion of 5 basis points.
  • Compared to the linked quarter, net interest margin increased 4 bp and spread increased 6 bp.  
  • The effective tax rate was 11.52% in the quarter compared to 17.34% in third quarter 2023 and 15.93% in the linked quarter. The lower effective tax rate in the current quarter was primarily due to the impact on state and federal taxes from the increase in credits and losses related to LIHTC investment properties placed in service during the period.

"Growth has certainly been challenging in the current environment but we believe our balance sheet is well positioned to support mid-single digit growth rates as we look ahead to next year. We plan to aggressively expand Towne Insurance and evaluate other opportunities to enhance our fee-based lines of business to further drive our differentiated business model," stated William I. Foster III, President and Chief Executive Officer.

Quarterly Net Interest Income:

  • Net interest income was $112.28 million compared to $113.06 million for the quarter ended September 30, 2023. The decrease was driven by increased deposit costs, which were mostly offset by higher yields on earning assets.
  • On an average basis, loans held for investment, with a yield of 5.46%, represented 74.16% of earning assets at September 30, 2024 compared to a yield of 5.13% and 73.45% of earning assets in the third quarter of 2023.
  • The cost of interest-bearing deposits was 3.28% for the quarter ended September 30, 2024, compared to 2.77% in second quarter 2023. Interest expense on deposits increased $17.96 million, or 27.98%, over the prior year quarter driven by the increase in rate and growth in interest-bearing deposits.
  • Our total cost of deposits increased to 2.29% from 1.84% for the quarter ended September 30, 2023 due to a combination of higher interest-bearing deposit balances coupled with higher rates.   The Federal Reserve Open Market Committee lowered the overnight funds rate late in the third quarter. Management is expecting the decrease to have favorable impact on deposit costs in the fourth quarter of 2024.
  • Average interest-earning assets totaled $15.40 billion at September 30, 2024 compared to $15.21 billion at September 30, 2023, an increase of 1.26%. The Company anticipates approximately $604 million of cash flows from its securities portfolio to be available for reinvestment in the next twenty-four months.
  • Average interest-bearing liabilities totaled $10.25 billion, an increase of $493.95 million, or 5.06%, from prior year, driven by deposit growth. Borrowings have declined between periods. There were no short term FHLB borrowings in the third quarter of 2024, compared to an average of $248.91 million in the prior year quarter.

Quarterly Provision for Credit Losses:

  • The quarterly provision for credit losses was a benefit of $1.10 million compared to an expense of $1.01 million in the prior year quarter and a benefit of $177 thousand in the linked quarter.
  • The allowance for credit losses on loans decreased $2.36 million in third quarter 2024, compared to the linked quarter. The decrease in the allowance was driven by a modest decline in the loan portfolio, primarily in higher-risk real estate construction and development loans, combined with continued strength in credit quality, and improvements in macroeconomic forecast scenarios utilized in our model.
  • Net loan charge-offs were $0.68 million in the quarter compared to net recoveries of $1.07 million in the prior year quarter and $19 thousand in the linked quarter.   Year-to-date 2024, net loan charge-offs were $1.18 million compared to net loan charge-offs of $2.81 million in first nine months of 2023.
  • The ratio of net charge-offs to average loans on an annualized basis was 0.02% in third quarter 2024, compared to (0.04)% in third quarter 2023 and 0.00% in the linked quarter.
  • The allowance for credit losses on loans represented 1.08% of total loans at September 30, 2024, compared to 1.12% at September 30, 2023, and 1.10% at June 30, 2024. The allowance for credit losses on loans was 18.70 times nonperforming loans compared to 17.60 times at September 30, 2023 and 19.08 times at June 30, 2024.

Quarterly Noninterest Income:

  • Total noninterest income was $62.24 million compared to $59.81 million in 2023, an increase of $2.43 million, or 4.06%.
  • Residential mortgage banking income was $11.79 million compared to $10.65 million in third quarter 2023. Loan volume increased to $598.18 million in third quarter 2024 from $520.41 million in third quarter 2023. Both, the number of loans originated and the per-loan average balance increased in third quarter 2024 compared to third quarter 2023. Refinance activities increased in the quarter after more than a year of low activity. Residential purchase activity was 91.49% of production volume in the third quarter of 2024 compared to 95.96% in third quarter 2023.   Management expects mortgage production volumes to be positively impacted by any additional reductions in the Federal Reserve overnight rate.
  • While level with the linked quarter at 3.28%, gross margins on residential mortgage sales increased 11 basis points from 3.17% in third quarter 2023.
  • Total net insurance commissions increased $1.95 million, or 8.20%, to $25.73 million in third quarter 2024 compared to 2023. This increase was primarily attributable to increases in property and casualty commissions, which were driven by organic growth.
  • Property management fee revenue decreased 12.34%, or $1.58 million, to $11.22 million in third quarter 2024 compared to 2023. Reservation levels declined compared to the prior year.

Quarterly Noninterest Expense:

  • Total noninterest expense was $126.90 million compared to $117.70 million in 2023, an increase of $9.20 million, or 7.81%. This increase was primarily attributable to growth in salaries and employee benefits of $4.87 million, professional fees of $1.95 million, software of $0.66 million, data processing of $0.56 million, and advertising and marketing of $0.51 million.
  • Salaries and benefits expense increases were driven by an increase in banking personnel and production incentives.
  • Investment in technology related to banking services and information monitoring continued to drive both direct and indirect costs. Professional fees increased due to consulting and outside services.   Software costs increased due to higher core system costs, while data processing increased due to higher processing costs and merchant fee increases.
  • Advertising and marketing increased, driven by business development.

Consolidated Balance Sheet Highlights:

  • Management is focused on strategic balance sheet management with a concentration on controlled loan growth and maintaining strong levels of liquidity.
  • Total assets were $17.19 billion for the quarter ended September 30, 2024, a $119.18 million increase compared to $17.07 billion at June 30, 2024. Total assets increased $507.66 million, or 3.04%, from $16.68 billion at September 30, 2023.
  • Loans held for investment declined $39.23 million, or 0.34%, compared to the linked quarter but increased $239.55 million, or 2.14%, compared to prior year. There were declines in several loan categories from the linked quarter, with the most significant decline in the real estate construction and development category.   The Company continued to maintain strong credit discipline throughout the period.
  • Mortgage loans held for sale increased $76.27 million, or 40.56%, compared to prior year and $63.56 million, or 31.66%, compared to the linked quarter, driven by the increase in production.
  • Total deposits increased $482.37 million, or 3.48%, primarily in interest-bearing demand and time deposits, compared to prior year. In the linked quarter comparison, total deposits increased $90.58 million, or 2.52% on an annualized basis.
  • Noninterest-bearing deposits decreased $177.23 million, or 3.99%, compared to prior year and $36.15 million, or 0.84%, compared to the linked quarter, primarily in commercial and escrow accounts.
  • Total borrowings decreased $116.22 million, or 28.55%, compared to third quarter 2023 and $4.35 million, or 1.47%, compared to the linked quarter. Short-term FHLB advances were zero at each of September 30, 2024, and the linked quarter end, compared to $100 million at September 30, 2023.

Investment Securities:

  • Total investment securities were $2.60 billion compared to $2.49 billion at June 30, 2024 and $2.54 billion at September 30, 2023. The weighted average duration of the portfolio at September 30, 2024 was 3.1 years. The carrying value of the available-for-sale debt securities portfolio included net unrealized losses of $110.62 million at September 30, 2024, compared to $172.93 million at June 30, 2024 and $238.52 million at September 30, 2023, with the changes in fair value due to the change in interest rates.

Loans and Asset Quality:

  • Total loans held for investment were $11.41 billion at September 30, 2024, $11.45 billion June 30, 2024, and $11.17 billion at September 30, 2023.
  • Nonperforming assets were $7.47 million, or 0.04% of total assets, compared to $7.88 million, or 0.05%, at September 30, 2023, and $7.16 million, or 0.04%, in the linked quarter end.
  • Nonperforming loans were 0.06% of period end loans at September 30, 2024, September 30, 2023, and the linked quarter end.
  • Foreclosed property consisted of $884 thousand in repossessed autos at September 30, 2024, compared to $276 thousand in other real estate owned and $490 thousand in repossessed autos, for a total of $766 thousand in foreclosed property at September 30, 2023.

Deposits and Borrowings:

  • Total deposits were $14.36 billion compared to $14.27 billion at June 30, 2024 and $13.88 billion at September 30, 2023.
  • The ratio of period end loans held for investment to deposits was 79.46% compared to 80.24% at June 30, 2024 and 80.49% at September 30, 2023.
  • Noninterest-bearing deposits were 29.71% of total deposits at September 30, 2024 compared to 30.15% at June 30, 2024 and 32.02% at September 30, 2023. Noninterest-bearing deposits declined $177.23 million, or 3.99%, compared to September 30, 2023, and $36.15 million, or 0.84%, compared to the linked quarter.
  • Total borrowings were $290.82 million compared to $295.17 million at June 30, 2024 and $407.03 million at September 30, 2023.

Capital:

  • Common equity tier 1 capital ratio of 12.63%(1).
  • Tier 1 leverage capital ratio of 10.38%(1).
  • Tier 1 risk-based capital ratio of 12.75%(1).
  • Total risk-based capital ratio of 15.53% (1) .
  • Book value per common share was $28.59 compared to $27.62 at June 30, 2024 and $26.28 at September 30, 2023.
  • Tangible book value per common share (non-GAAP) was $21.65 compared to $20.65 at June 30, 2024 and $19.28 at September 30, 2023.

(1) Preliminary.

About TowneBank:
Founded in 1999, TowneBank is a company built on relationships, offering a full range of banking and other financial services, with a focus of serving others and enriching lives. Dedicated to a culture of caring, Towne values all employees and members by embracing their diverse talents, perspectives, and experiences.

Now celebrating 25 years, TowneBank operates 50 banking offices throughout Hampton Roads and Central Virginia, as well as Northeastern and Central North Carolina – serving as a local leader in promoting the social, cultural, and economic growth in each community. Towne offers a competitive array of business and personal banking solutions, delivered with only the highest ethical standards. Experienced local bankers providing a higher level of expertise and personal attention with local decision-making are key to the TowneBank strategy. TowneBank has grown its capabilities beyond banking to provide expertise through its affiliated companies that include Towne Wealth Management, Towne Insurance Agency, Towne Benefits, TowneBank Mortgage, TowneBank Commercial Mortgage, Berkshire Hathaway HomeServices RW Towne Realty, Towne 1031 Exchange, LLC, and Towne Vacations. With total assets of $17.19 billion as of September 30, 2024, TowneBank is one of the largest banks headquartered in Virginia.

Non-GAAP Financial Measures:
This press release contains certain financial measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Such non-GAAP financial measures include the following: fully tax-equivalent net interest margin, core operating earnings, core net income, tangible book value per common share, total risk-based capital ratio, tier one leverage ratio, tier one capital ratio, and the tangible common equity to tangible assets ratio. Management uses these non-GAAP financial measures to assess the performance of TowneBank’s core business and the strength of its capital position. Management believes that these non-GAAP financial measures provide meaningful additional information about TowneBank to assist investors in evaluating operating results, financial strength, and capitalization. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant charges for credit costs and other factors. These non-GAAP financial measures should not be considered as a substitute for operating results determined in accordance with GAAP and may not be comparable to other similarly titled measures of other companies. The computations of the non-GAAP financial measures used in this presentation are referenced in a footnote or in the appendix to this presentation.

Forward-Looking Statements:
This press release contains certain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts, but instead represent only the beliefs, expectations, or opinions of TowneBank and its management regarding future events, many of which, by their nature, are inherently uncertain. Forward-looking statements may be identified by the use of such words as: "believe," "expect," "anticipate," "intend," "plan,” "estimate," or words of similar meaning, or future or conditional terms, such as "will," "would," "should," "could," "may," "likely," "probably," or "possibly." These statements may address issues that involve significant risks, uncertainties, estimates, and assumptions made by management. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include among others, competitive pressures in the banking industry that may increase significantly; changes in the interest rate environment that may reduce margins and/or the volumes and values of loans made or held as well as the value of other financial assets held; an unforeseen outflow of cash or deposits or an inability to access the capital markets, which could jeopardize our overall liquidity or capitalization; changes in the creditworthiness of customers and the possible impairment of the collectability of loans; insufficiency of our allowance for credit losses due to market conditions, inflation, changing interest rates or other factors; adverse developments in the financial industry generally, such as the recent bank failures, responsive measures to mitigate and manage such developments, related supervisory and regulatory actions and costs, and related impacts on customer and client behavior; general economic conditions, either nationally or regionally, that may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit or other services; geopolitical instability, including wars, conflicts, civil unrest, and terrorist attacks and the potential impact, directly or indirectly, on our business; the effects of weather-related or natural disasters, which may negatively affect our operations and/or our loan portfolio and increase our cost of conducting business; public health events (such as the COVID-19 pandemic) and governmental and societal responses to them; changes in the legislative or regulatory environment, including changes in accounting standards and tax laws, that may adversely affect our business; our ability to close the transaction with Village Bank when expected or at all because required approvals and other conditions to closing are not received or satisfied on the proposed terms or on the anticipated schedule; our integration of Village Bank's business to the extent that it may take longer or be more difficult, time-consuming or costly to accomplish than expected; deposit attrition, operating costs, customer losses and business disruption following the Village Bank transaction, including adverse effects on relationships with employees and customers; costs or difficulties related to the integration of the businesses we have acquired may be greater than expected; expected growth opportunities or cost savings associated with pending or recently completed acquisitions may not be fully realized or realized within the expected time frame; cybersecurity threats or attacks, whether directed at us or at vendors or other third parties with which we interact, the implementation of new technologies, and the ability to develop and maintain reliable electronic systems; our competitors may have greater financial resources and develop products that enable them to compete more successfully; changes in business conditions; changes in the securities market; and changes in our local economy with regard to our market area. Any forward-looking statements made by us or on our behalf speak only as of the date they are made or as of the date indicated, and we do not undertake any obligation to update forward-looking statements as a result of new information, future events, or otherwise. For additional information on factors that could materially influence forward-looking statements included in this report, see the "Risk Factors" in TowneBank’s Annual Report on Form 10-K for the year ended December 31, 2023, and related disclosures in other filings that have been, or will be, filed by TowneBank with the Federal Deposit Insurance Corporation.

Media contact:
G. Robert Aston, Jr., Executive Chairman, 757-638-6780
William I. Foster III, President and Chief Executive Officer, 757-417-6482

Investor contact:
William B. Littreal, Chief Financial Officer, 757-638-6813


 
TOWNEBANK
Selected Financial Highlights (unaudited)
(dollars in thousands, except per share data)
   
  Three Months Ended
  September 30, June 30, March 31, December 31, September 30,
  2024   2024   2024   2023   2023 
Income and Performance Ratios:         
 Total revenue$174,518  $174,970  $167,102  $155,546  $172,864 
 Net income 43,126   43,039   35,127   28,545   44,745 
 Net income available to common shareholders 42,949   42,856   34,687   28,804   44,862 
 Net income per common share - diluted 0.57   0.57   0.46   0.39   0.60 
 Book value per common share 28.59   27.62   27.33   27.24   26.28 
 Book value per common share - tangible (non-GAAP) 21.65   20.65   20.31   20.28   19.28 
 Return on average assets 1.00%  1.01%  0.83%  0.68%  1.06%
 Return on average assets - tangible (non-GAAP) 1.09%  1.11%  0.92%  0.77%  1.17%
 Return on average equity 8.12%  8.43%  6.84%  5.75%  8.96%
 Return on average equity - tangible (non-GAAP) 11.42%  12.03%  9.87%  8.53%  12.97%
 Return on average common equity 8.18%  8.49%  6.89%  5.79%  9.04%
 Return on average common equity - tangible (non-GAAP) 11.54%  12.16%  9.98%  8.62%  13.11%
 Noninterest income as a percentage of total revenue 35.66%  37.68%  38.23%  30.74%  34.60%
Regulatory Capital Ratios (1):         
 Common equity tier 1 12.63%  12.43%  12.20%  12.18%  12.19%
 Tier 1 12.75%  12.55%  12.32%  12.29%  12.31%
 Total 15.53%  15.34%  15.10%  15.06%  15.09%
 Tier 1 leverage ratio 10.38%  10.25%  10.15%  10.17%  10.06%
Asset Quality:         
 Allowance for credit losses on loans to nonperforming loans18.70x 19.08x 18.01x 18.48x 17.60x
 Allowance for credit losses on loans to period end loans 1.08%  1.10%  1.10%  1.12%  1.12%
 Nonperforming loans to period end loans 0.06%  0.06%  0.06%  0.06%  0.06%
 Nonperforming assets to period end assets 0.04%  0.04%  0.05%  0.05%  0.05%
 Net charge-offs (recoveries) to average loans (annualized) 0.02%  %  0.02%  % (0.04)%
 Net charge-offs (recoveries)$677  $(19) $520  $68  $(1,074)
           
 Nonperforming loans$6,588  $6,582  $6,987  $6,843  $7,110 
 Foreclosed property 884   581   780   908   766 
 Total nonperforming assets$7,472  $7,163  $7,767  $7,751  $7,876 
 Loans past due 90 days and still accruing interest$510  $368  $323  $735  $970 
 Allowance for credit losses on loans$123,191  $125,552  $125,835  $126,461  $125,159 
Mortgage Banking:         
 Loans originated, mortgage$421,571  $430,398  $289,191  $302,616  $348,387 
 Loans originated, joint venture 176,612   196,583   135,197   126,332   172,021 
 Total loans originated$598,182  $626,981  $424,388  $428,948  $520,408 
 Number of loans originated 1,637   1,700   1,247   1,237   1,487 
 Number of originators 159   169   176   181   192 
 Purchase % 91.49%  94.85%  95.66%  95.06%  95.96%
 Loans sold$526,998  $605,134  $410,895  $468,014  $567,291 
 Rate lock asset$1,548  $1,930  $1,681  $895  $1,348 
 Gross realized gain on sales and fees as a % of loans originated 3.28%  3.28%  3.34%  3.06%  3.17%
Other Ratios:         
 Net interest margin 2.90%  2.86%  2.72%  2.83%  2.95%
 Net interest margin-fully tax-equivalent (non-GAAP) 2.93%  2.89%  2.75%  2.86%  2.98%
 Average earning assets/total average assets 90.43%  90.36%  90.52%  90.48%  90.73%
 Average loans/average deposits 80.07%  80.80%  81.48%  80.72%  80.75%
 Average noninterest deposits/total average deposits 30.19%  30.06%  30.25%  31.69%  33.50%
 Period end equity/period end total assets 12.58%  12.24%  12.24%  12.21%  11.90%
 Efficiency ratio (non-GAAP) 70.93%  68.98%  73.25%  76.17%  66.21%
 (1) Current reporting period regulatory capital ratios are preliminary.      


 
TOWNEBANK
Selected Data (unaudited)
(dollars in thousands)
 
Investment Securities      % Change
 Q3 Q3 Q2 Q3 24 vs. Q3 24 vs.
Available-for-sale securities, at fair value 2024   2023   2024  Q3 23 Q2 24
U.S. agency securities$291,814  $300,161  $281,934  (2.78)% 3.50%
U.S. Treasury notes 28,655   26,721   27,701  7.24% 3.44%
Municipal securities 455,722   484,587   442,474  (5.96)% 2.99%
Trust preferred and other corporate securities 91,525   74,024   88,228  23.64% 3.74%
Mortgage-backed securities issued by GSEs and GNMA 1,496,631   1,079,303   1,411,883  38.67% 6.00%
Allowance for credit losses (1,171)  (1,343)  (1,541) (12.81)% (24.01)%
Total$2,363,176  $1,963,453  $2,250,679  20.36% 5.00%
Gross unrealized gains (losses) reflected in financial statements      
Total gross unrealized gains$6,703  $475  $1,983  1,311.16% 238.02%
Total gross unrealized losses (117,319)  (238,993)  (174,911) (50.91)% (32.93)%
Net unrealized gains (losses) and other adjustments on AFS securities$(110,616) $(238,518) $(172,928) (53.62)% (36.03)%
Held-to-maturity securities, at amortized cost         
U.S. agency securities$102,428  $101,659  $102,234  0.76% 0.19%
U.S. Treasury notes 96,942   433,015   97,171  (77.61)% (0.24)%
Municipal securities 5,342   5,249   5,318  1.77% 0.45%
Trust preferred corporate securities 2,133   2,185   2,147  (2.38)% (0.65)%
Mortgage-backed securities issued by GSEs 5,577   5,746   5,618  (2.94)% (0.73)%
Allowance for credit losses (77)  (85)  (79) (9.41)% (2.53)%
Total$212,345  $547,769  $212,409  (61.23)% (0.03)%
          
Total gross unrealized gains$323  $82  $175  293.90% 84.57%
Total gross unrealized losses (7,929)  (23,505)  (12,880) (66.27)% (38.44)%
Net unrealized gains (losses) in HTM securities$(7,606) $(23,423) $(12,705) (67.53)% (40.13)%
Total unrealized gains (losses) on AFS and HTM securities$(118,222) $(261,941) $(185,633) (54.87)% (36.31)%
       % Change
Loans Held For InvestmentQ3 Q3 Q2 Q3 24 vs. Q3 24 vs.
  2024   2023   2024  Q3 23 Q2 24
Real estate - construction and development$1,118,669  $1,325,976  $1,190,768  (15.63)% (6.05)%
Commercial real estate - owner occupied 1,655,345   1,686,888   1,673,582  (1.87)% (1.09)%
Commercial real estate - non owner occupied 3,179,699   3,025,985   3,155,958  5.08% 0.75%
Real estate - multifamily 750,906   542,611   682,537  38.39% 10.02%
Residential 1-4 family 1,891,216   1,818,843   1,887,420  3.98% 0.20%
HELOC 408,565   371,861   408,273  9.87% 0.07%
Commercial and industrial business (C&I) 1,256,511   1,237,524   1,297,538  1.53% (3.16)%
Government 521,681   523,456   517,954  (0.34)% 0.72%
Indirect 546,887   548,621   558,216  (0.32)% (2.03)%
Consumer loans and other 83,039   91,206   79,501  (8.95)% 4.45%
Total$11,412,518  $11,172,971  $11,451,747  2.14% (0.34)%
          
       % Change
DepositsQ3 Q3 Q2 Q3 24 vs. Q3 24 vs.
  2024   2023   2024  Q3 23 Q2 24
Noninterest-bearing demand$4,267,628  $4,444,861  $4,303,773  (3.99)% (0.84)%
Interest-bearing:         
Demand and money market accounts 6,990,103   6,764,415   6,940,086  3.34% 0.72%
Savings 319,970   350,031   312,881  (8.59)% 2.27%
Certificates of deposits 2,785,469   2,321,498   2,715,848  19.99% 2.56%
Total 14,363,170   13,880,805   14,272,588  3.48% 0.63%


 
TOWNEBANK
Average Balances, Yields and Rate Paid (unaudited)
(dollars in thousands)
 
 Three Months Ended Three Months Ended Three Months Ended
 September 30, 2024 June 30, 2024 September 30, 2023
   Interest Average   Interest Average   Interest Average
 Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/
 Balance Expense Rate (1) Balance Expense Rate (1) Balance Expense Rate (1)
Assets:                 
Loans (net of unearned income
and deferred costs)
$11,419,428  $156,610  5.46% $11,471,669  $155,374  5.45% $11,169,924  $144,457  5.13%
Taxable investment securities 2,376,102   20,940  3.53%  2,368,476   21,671  3.66%  2,373,731   18,645  3.14%
Tax-exempt investment securities 168,768   1,686  4.00%  156,503   1,521  3.89%  206,639   1,993  3.86%
Total securities 2,544,870   22,626  3.56%  2,524,979   23,192  3.67%  2,580,370   20,638  3.20%
Interest-bearing deposits 1,226,445   15,249  4.95%  1,182,816   14,512  4.93%  1,230,582   15,031  4.85%
Mortgage loans held for sale 208,513   3,247  6.23%  165,392   2,945  7.12%  227,426   3,928  6.91%
Total earning assets 15,399,256   197,732  5.11%  15,344,856   196,023  5.14%  15,208,302   184,054  4.80%
Less: allowance for loan losses (125,331)      (126,792)      (125,553)    
Total nonearning assets 1,754,216       1,764,418       1,680,110     
Total assets$17,028,141      $16,982,482      $16,762,859     
Liabilities and Equity:                 
Interest-bearing deposits                 
Demand and money market$6,917,622  $48,896  2.81% $6,896,176  $48,161  2.81% $6,605,853  $41,381  2.49%
Savings 315,338   842  1.06%  317,774   845  1.07%  356,116   938  1.05%
Certificates of deposit 2,723,437   32,390  4.73%  2,715,615   33,017  4.89%  2,236,102   21,852  3.88%
Total interest-bearing deposits 9,956,397   82,128  3.28%  9,929,565   82,023  3.32%  9,198,071   64,171  2.77%
Borrowings 33,867   (25) (0.29)%  100,165   1,627  6.43%  299,105   3,382  4.42%
Subordinated debt, net 256,309   2,237  3.49%  256,093   2,236  3.49%  255,446   2,245  3.52%
Total interest-bearing liabilities 10,246,573   84,340  3.27%  10,285,823   85,886  3.36%  9,752,622   69,798  2.84%
Demand deposits 4,305,783       4,267,590       4,633,856     
Other noninterest-bearing liabilities 370,736       383,447       389,912     
Total liabilities 14,923,092       14,936,860       14,776,390     
Shareholders’ equity 2,105,049       2,045,622       1,986,469     
Total liabilities and equity$17,028,141      $16,982,482      $16,762,859     
Net interest income (tax-equivalent basis) (4)  $113,392      $110,137      $114,256   
Reconciliation of Non-GAAP Financial Measures                
Tax-equivalent basis adjustment   (1,110)      (1,089)      (1,198)  
Net interest income (GAAP)  $112,282      $109,048      $113,058   
                  
Interest rate spread (2)(4)    1.84%     1.78%     1.96%
Interest expense as a percent of average earning assets   2.18%     2.25%     1.82%
Net interest margin (tax-equivalent basis) (3)(4)   2.93%     2.89%     2.98%
Total cost of deposits    2.29%     2.32%     1.84%
                  
(1) Yields and interest income are presented on a tax-equivalent basis using the federal statutory tax rate of 21%.
(2) Interest spread is the average yield earned on earning assets less the average rate paid on interest-bearing liabilities. Fully tax-equivalent.
(3) Net interest margin is net interest income expressed as a percentage of average earning assets. Fully tax-equivalent.
(4) Non-GAAP.


 
TOWNEBANK
Average Balances, Yields and Rate Paid (unaudited)
(dollars in thousands)
 
 Nine Months Ended Nine Months Ended
 September 30, 2024 September 30, 2023
   Interest Average   Interest Average
 Average  Income/ Yield/ Average  Income/ Yield/
 Balance Expense Rate (1) Balance Expense Rate (1)
Assets:           
Loans (net of unearned income and deferred costs)$11,423,458  $463,794  5.42% $11,159,329  $417,808  5.01%
Taxable investment securities 2,395,007   61,327  3.41%  2,420,634   52,656  2.90%
Tax-exempt investment securities 162,294   4,756  3.91%  201,535   5,883  3.89%
Total securities 2,557,301   66,083  3.45%  2,622,169   58,539  2.98%
Interest-bearing deposits 1,192,319   43,995  4.93%  1,179,952   40,168  4.55%
Mortgage loans held for sale 163,755   7,908  6.44%  168,822   8,079  6.38%
Total earning assets 15,336,833   581,780  5.07%  15,130,272   524,594  4.64%
Less: allowance for loan losses (126,508)      (120,420)    
Total nonearning assets 1,748,215       1,637,952     
Total assets$16,958,540      $16,647,804     
Liabilities and Equity:           
Interest-bearing deposits           
Demand and money market$6,880,752  $145,042  2.82% $6,349,422  $96,742  2.04%
Savings 320,696   2,569  1.07%  376,282   2,676  0.95%
Certificates of deposit 2,674,509   94,928  4.74%  1,964,718   47,358  3.22%
Total interest-bearing deposits 9,875,957   242,539  3.28%  8,690,422   146,776  2.26%
Borrowings 115,171   4,679  5.34%  505,856   17,644  4.60%
Subordinated debt, net 256,094   6,710  3.49%  253,612   6,650  3.50%
Total interest-bearing liabilities 10,247,222   253,928  3.31%  9,449,890   171,070  2.42%
Demand deposits 4,265,971       4,873,945     
Other noninterest-bearing liabilities 381,547       353,459     
Total liabilities 14,894,740       14,677,294     
Shareholders’ equity 2,063,800       1,970,510     
Total liabilities and equity$16,958,540      $16,647,804     
Net interest income (tax-equivalent basis)(4)  $327,852      $353,524   
Reconciliation of Non-GAAP Financial Measures          
Tax-equivalent basis adjustment   (3,304)      (3,477)  
Net interest income (GAAP)  $324,548      $350,047   
            
Interest rate spread (2)(4)    1.76%     2.22%
Interest expense as a percent of average earning assets   2.21%     1.51%
Net interest margin (tax-equivalent basis) (3)(4)   2.86%     3.12%
Total cost of deposits    2.29%     1.45%
            
(1) Yields and interest income are presented on a tax-equivalent basis using the federal statutory rate of 21%.
(2) Interest spread is the average yield earned on earning assets less the average rate paid on interest-bearing liabilities. Fully tax-equivalent.
(3) Net interest margin is net interest income expressed as a percentage of average earning assets. Fully tax-equivalent.
(4) Non-GAAP.


 
TOWNEBANK
Consolidated Balance Sheets
(dollars in thousands, except share data)
  
   
 September 30, December 31,
  2024   2023 
 (unaudited) (audited)
ASSETS   
Cash and due from banks$131,068  $85,584 
Interest-bearing deposits at FRB 1,061,596   939,356 
Interest-bearing deposits in financial institutions 103,400   103,417 
Total Cash and Cash Equivalents 1,296,064   1,128,357 
Securities available for sale, at fair value (amortized cost of $2,474,963 and $2,292,963, and allowance for credit losses of $1,171 and $1,498 at September 30, 2024 and December 31, 2023, respectively) 2,363,176   2,129,342 
Securities held to maturity, at amortized cost (fair value $204,816 and $462,656 at September 30, 2024 and December 31, 2023, respectively) 212,422   477,592 
Less: Allowance for credit losses (77)  (84)
Securities held to maturity, net of allowance for credit losses 212,345   477,508 
Other equity securities 12,681   13,792 
FHLB stock 12,134   21,372 
Total Securities 2,600,336   2,642,014 
Mortgage loans held for sale 264,320   149,987 
Loans, net of unearned income and deferred costs 11,412,518   11,329,021 
Less: allowance for credit losses (123,191)  (126,461)
Net Loans 11,289,327   11,202,560 
Premises and equipment, net 365,764   337,598 
Goodwill 457,619   456,335 
Other intangible assets, net 63,265   64,634 
BOLI 279,325   277,445 
Other assets 572,000   576,109 
TOTAL ASSETS$17,188,020  $16,835,039 
    
LIABILITIES AND EQUITY   
Deposits:   
Noninterest-bearing demand$4,267,628  $4,342,701 
Interest-bearing:   
Demand and money market accounts 6,990,103   6,757,619 
Savings 319,970   336,492 
Certificates of deposit 2,785,469   2,456,394 
Total Deposits 14,363,170   13,893,206 
Advances from the FHLB 3,405   203,958 
Subordinated debt, net 256,444   255,796 
Repurchase agreements and other borrowings 30,970   32,826 
Total Borrowings 290,819   492,580 
Other liabilities 371,316   393,375 
TOTAL LIABILITIES 15,025,305   14,779,161 
Preferred stock, authorized and unissued shares - 2,000,000     
Common stock, $1.667 par value: 150,000,000 shares authorized;   
75,068,662 and 74,893,462 shares issued at   
September 30, 2024 and December 31, 2023, respectively 125,139   124,847 
Capital surplus 1,117,279   1,112,761 
Retained earnings 985,343   921,126 
Common stock issued to deferred compensation trust, at cost:   
1,056,823 and 1,004,717 shares at September 30, 2024 and December 31, 2023, respectively (22,224)  (20,813)
Deferred compensation trust 22,224   20,813 
Accumulated other comprehensive income (loss) (81,482)  (118,762)
TOTAL SHAREHOLDERS’ EQUITY 2,146,279   2,039,972 
Noncontrolling interest 16,436   15,906 
TOTAL EQUITY 2,162,715   2,055,878 
TOTAL LIABILITIES AND EQUITY$17,188,020  $16,835,039 
 


TOWNEBANK
Consolidated Statements of Income (unaudited)
(dollars in thousands, except per share data)
        
        
 Three Months Ended Nine Months Ended
 September 30, September 30,
  2024   2023   2024   2023 
INTEREST INCOME:       
Loans, including fees$155,792  $143,605  $461,316  $415,351 
Investment securities 22,334   20,292   65,257   57,519 
Interest-bearing deposits in financial institutions and federal funds sold 15,249   15,031   43,995   40,168 
Mortgage loans held for sale 3,247   3,928   7,908   8,079 
Total interest income 196,622   182,856   578,476   521,117 
INTEREST EXPENSE:       
Deposits 82,128   64,171   242,539   146,776 
Advances from the FHLB 29   3,438   3,408   16,838 
Subordinated debt, net 2,237   2,245   6,710   6,650 
Repurchase agreements and other borrowings (54)  (56)  1,271   806 
Total interest expense 84,340   69,798   253,928   171,070 
Net interest income 112,282   113,058   324,548   350,047 
PROVISION FOR CREDIT LOSSES (1,100)  1,007   (2,154)  16,232 
Net interest income after provision for credit losses 113,382   112,051   326,702   333,815 
NONINTEREST INCOME:       
Residential mortgage banking income, net 11,786   10,648   35,685   31,380 
Insurance commissions and related income, net 25,727   23,777   75,297   69,098 
Property management income, net 11,221   12,800   42,306   40,433 
Real estate brokerage income, net    (63)     3,562 
Service charges on deposit accounts 3,117   2,823   9,548   8,577 
Credit card merchant fees, net 1,830   2,006   5,042   5,232 
Investment commissions, net 2,835   2,363   7,759   6,581 
BOLI 1,886   1,814   6,966   5,196 
Gain on sale of equity investment 20   554   20   9,386 
Other income 3,814   3,084   9,345   9,083 
Net gain/(loss) on investment securities       74    
Total noninterest income 62,236   59,806   192,042   188,528 
NONINTEREST EXPENSE:       
Salaries and employee benefits 72,123   67,258   214,849   204,124 
Occupancy 9,351   9,027   28,490   27,579 
Furniture and equipment 4,657   4,100   13,769   12,733 
Amortization - intangibles 3,130   3,610   9,675   10,744 
Software 6,790   6,130   19,947   17,922 
Data processing 4,701   4,140   13,223   11,504 
Professional fees 4,720   2,770   11,689   8,948 
Advertising and marketing 4,162   3,653   12,268   12,012 
Other expenses 17,266   17,014   52,565   61,762 
Total noninterest expense 126,900   117,702   376,475   367,328 
Income before income tax expense and noncontrolling interest 48,718   54,155   142,269   155,015 
Provision for income tax expense 5,592   9,410   20,977   28,424 
Net income$43,126  $44,745  $121,292  $126,591 
Net income attributable to noncontrolling interest (177)  117   (800)  (1,680)
Net income attributable to TowneBank$42,949  $44,862  $120,492  $124,911 
Per common share information       
Basic earnings$0.57  $0.60  $1.61  $1.67 
Diluted earnings$0.57  $0.60  $1.61  $1.67 
Cash dividends declared$0.25  $0.25  $0.75  $0.73 


 
TOWNEBANK
Consolidated Balance Sheets - Five Quarter Trend
(dollars in thousands, except share data)
 
          
 September 30, June 30, March 31, December 31, September 30,
  2024   2024   2024   2023   2023 
 (unaudited) (unaudited) (unaudited) (audited) (unaudited)
ASSETS         
Cash and due from banks$131,068  $140,028  $75,802  $85,584  $83,949 
Interest-bearing deposits at FRB 1,061,596   1,062,115   926,635   939,356   1,029,276 
Interest-bearing deposits in financial institutions 103,400   99,303   98,673   103,417   102,527 
Total Cash and Cash Equivalents 1,296,064   1,301,446   1,101,110   1,128,357   1,215,752 
Securities available for sale 2,363,176   2,250,679   2,204,101   2,129,342   1,963,453 
Securities held to maturity 212,422   212,488   312,510   477,592   547,854 
Less: allowance for credit losses (77)  (79)  (82)  (84)  (85)
Securities held to maturity, net of allowance for credit losses 212,345   212,409   312,428   477,508   547,769 
Other equity securities 12,681   13,566   13,661   13,792   14,062 
FHLB stock 12,134   12,134   12,139   21,372   16,634 
Total Securities 2,600,336   2,488,788   2,542,329   2,642,014   2,541,918 
Mortgage loans held for sale 264,320   200,762   150,727   149,987   188,048 
Loans, net of unearned income and deferred costs 11,412,518   11,451,747   11,452,343   11,329,021   11,172,971 
Less: Allowance for credit losses (123,191)  (125,552)  (125,835)  (126,461)  (125,159)
Net Loans 11,289,327   11,326,195   11,326,508   11,202,560   11,047,812 
Premises and equipment, net 365,764   340,348   342,569   337,598   335,522 
Goodwill 457,619   457,619   457,619   456,335   456,684 
Other intangible assets, net 63,265   65,460   68,758   64,634   67,496 
BOLI 279,325   277,434   279,293   277,445   275,240 
Other assets 572,000   610,791   615,324   576,109   551,884 
TOTAL ASSETS$17,188,020  $17,068,843  $16,884,237  $16,835,039  $16,680,356 
LIABILITIES AND EQUITY         
Deposits:         
Noninterest-bearing demand$4,267,628  $4,303,773  $4,194,132  $4,342,701  $4,444,861 
Interest-bearing:         
Demand and money market accounts 6,990,103   6,940,086   6,916,701   6,757,619   6,764,415 
Savings 319,970   312,881   326,179   336,492   350,031 
Certificates of deposit 2,785,469   2,715,848   2,689,062   2,456,394   2,321,498 
Total Deposits 14,363,170   14,272,588   14,126,074   13,893,206   13,880,805 
Advances from the FHLB 3,405   3,591   3,775   203,958   104,139 
Subordinated debt, net 256,444   256,227   256,011   255,796   255,580 
Repurchase agreements and other borrowings 30,970   35,351   31,198   32,826   47,315 
Total Borrowings 290,819   295,169   290,984   492,580   407,034 
Other liabilities 371,316   411,770   401,307   393,375   408,305 
TOTAL LIABILITIES 15,025,305   14,979,527   14,818,365   14,779,161   14,696,144 
          
Preferred stock              
Common stock, $1.667 par value 125,139   125,090   125,009   124,847   124,837 
Capital surplus 1,117,279   1,115,759   1,114,038   1,112,761   1,111,152 
Retained earnings 985,343   961,162   937,065   921,126   911,042 
Common stock issued to deferred compensation trust, at cost (22,224)  (22,756)  (20,915)  (20,813)  (20,740)
Deferred compensation trust 22,224   22,756   20,915   20,813   20,740 
Accumulated other comprehensive income (loss) (81,482)  (129,224)  (126,586)  (118,762)  (179,043)
TOTAL SHAREHOLDERS’ EQUITY 2,146,279   2,072,787   2,049,526   2,039,972   1,967,988 
Noncontrolling interest 16,436   16,529   16,346   15,906   16,224 
TOTAL EQUITY 2,162,715   2,089,316   2,065,872   2,055,878   1,984,212 
TOTAL LIABILITIES AND EQUITY$17,188,020  $17,068,843  $16,884,237  $16,835,039  $16,680,356 


 
TOWNEBANK
Consolidated Statements of Income - Five Quarter Trend (unaudited)
(dollars in thousands, except share data)
  
  
 Three Months Ended
 September 30, June 30, March 31, December 31, September 30,
  2024   2024   2024   2023   2023 
INTEREST INCOME:         
Loans, including fees$155,792  $154,549  $150,974  $146,810  $143,605 
Investment securities 22,334   22,928   19,996   20,464   20,292 
Interest-bearing deposits in financial institutions and federal funds sold 15,249   14,512   14,234   13,967   15,031 
Mortgage loans held for sale 3,247   2,945   1,716   2,886   3,928 
Total interest income 196,622   194,934   186,920   184,127   182,856 
INTEREST EXPENSE:         
Deposits 82,128   82,023   78,388   73,200   64,171 
Advances from the FHLB 29   942   2,438   917   3,438 
Subordinated debt, net 2,237   2,236   2,236   2,236   2,245 
Repurchase agreements and other borrowings (54)  685   640   41   (56)
Total interest expense 84,340   85,886   83,702   76,394   69,798 
Net interest income 112,282   109,048   103,218   107,733   113,058 
PROVISION FOR CREDIT LOSSES (1,100)  (177)  (877)  2,446   1,007 
Net interest income after provision for credit losses 113,382   109,225   104,095   105,287   112,051 
NONINTEREST INCOME:         
Residential mortgage banking income, net 11,786   13,422   10,477   8,035   10,648 
Insurance commissions and related income, net 25,727   24,031   25,539   21,207   23,777 
Property management income, net 11,221   14,312   16,773   7,358   12,800 
Real estate brokerage income, net          (32)  (63)
Service charges on deposit accounts 3,117   3,353   3,079   3,056   2,823 
Credit card merchant fees, net 1,830   1,662   1,551   1,476   2,006 
Investment commissions, net 2,835   2,580   2,343   2,380   2,363 
BOLI 1,886   3,238   1,842   2,206   1,814 
Other income 3,834   3,324   2,206   2,127   3,638 
Net gain/(loss) on investment securities       74       
Total noninterest income 62,236   65,922   63,884   47,813   59,806 
NONINTEREST EXPENSE:         
Salaries and employee benefits 72,123   71,349   71,377   66,035   67,258 
Occupancy 9,351   9,717   9,422   9,308   9,027 
Furniture and equipment 4,657   4,634   4,478   4,445   4,100 
Amortization - intangibles 3,130   3,298   3,246   3,411   3,610 
Software 6,790   7,056   6,100   6,743   6,130 
Data processing 4,701   4,606   3,916   3,529   4,140 
Professional fees 4,720   3,788   3,180   3,339   2,770 
Advertising and marketing 4,162   3,524   4,582   3,377   3,653 
Other expenses 17,266   16,012   19,290   21,708   17,014 
Total noninterest expense 126,900   123,984   125,591   121,895   117,702 
Income before income tax expense and noncontrolling interest 48,718   51,163   42,388   31,205   54,155 
Provision for income tax expense 5,592   8,124   7,261   2,660   9,410 
Net income 43,126   43,039   35,127   28,545   44,745 
Net income attributable to noncontrolling interest (177)  (183)  (440)  259   117 
Net income attributable to TowneBank$42,949  $42,856  $34,687  $28,804  $44,862 
Per common share information         
Basic earnings$0.57  $0.57  $0.46  $0.39  $0.60 
Diluted earnings$0.57  $0.57  $0.46  $0.39  $0.60 
Basic weighted average shares outstanding 74,940,827   74,925,877   74,816,420   74,773,335   74,750,294 
Diluted weighted average shares outstanding 75,141,661   75,037,955   74,979,501   74,793,557   74,765,515 
Cash dividends declared$0.25  $0.25  $0.25  $0.25  $0.25 
          


TOWNEBANK
Banking Segment Financial Information (unaudited)
(dollars in thousands)
 
          
 Three Months Ended Nine Months Ended Increase/(Decrease)
 September 30, June 30, September 30, YTD 2024 over 2023
  2024   2023   2024   2024   2023  Amount Percent
Revenue             
Net interest income$111,569  $112,189  $108,029  $322,280  $349,165  $(26,885) (7.70)%
Service charges on deposit accounts 3,117   2,823   3,352   9,548   8,577   971  11.32%
Credit card merchant fees 1,830   2,006   1,662   5,042   5,232   (190) (3.63)%
Investment commissions, net 2,835   2,363   2,580   7,759   6,581   1,178  17.90%
Other income 4,828   4,224   4,840   13,096   12,012   1,084  9.02%
Subtotal 12,610   11,416   12,434   35,445   32,402   3,043  9.39%
Net gain/(loss) on investment securities          74      74  N/M
Total noninterest income 12,610   11,416   12,434   35,519   32,402   3,117  9.62%
Total revenue 124,179   123,605   120,463   357,799   381,567   (23,768) (6.23)%
              
Provision for credit losses (1,043)  1,206   (170)  (2,189)  16,442   (18,631) (113.31)%
              
Expenses             
Salaries and employee benefits 47,148   42,727   46,640   140,261   128,161   12,100  9.44%
Occupancy 6,963   6,637   7,194   21,217   19,717   1,500  7.61%
Furniture and equipment 3,878   3,273   3,810   11,336   10,150   1,186  11.68%
Amortization of intangible assets 1,072   1,296   1,117   3,352   3,918   (566) (14.45)%
Other expenses 26,674   22,595   23,587   77,215   80,215   (3,000) (3.74)%
Total expenses 85,735   76,528   82,348   253,381   242,161   11,220  4.63%
Income before income tax, corporate allocation and noncontrolling interest 39,487   45,871   38,285   106,607   122,964   (16,357) (13.30)%
Corporate allocation 1,223   1,291   1,232   3,524   3,763   (239) (6.35)%
Income before income tax provision and noncontrolling interest 40,710   47,162   39,517   110,131   126,727