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Premier Financial Corp. Announces First Quarter 2023 Results Including Solid Capital and Liquidity Levels

First Quarter 2023 Highlights

  • CET1 ratio increased 5 basis points to 9.96% and tangible equity ratio increased 25 basis points to 7.03% from the prior quarter
  • Delinquencies decreased $7.2 million or 39% to 0.16% of loans from the prior quarter
  • Loan growth of $115.2 million (up 7.1% annualized) including $69.2 million for commercial loans excluding PPP (up 6.5% annualized)
  • Declared dividend of $0.31 per share, up 3.3% from prior year comparable period

Premier Financial Corp. (Nasdaq: PFC) (“Premier” or the “Company”) announced today 2023 first quarter results including net income of $18.1 million or $0.51 per diluted common share, compared to $25.3 million, or $0.71 per diluted common share, for the fourth quarter of 2022. First quarter 2023 results include the impact of the following items: i) equity investment losses of $1.4 million pre-tax or $0.03 per diluted share after-tax; ii) a negative mortgage pipeline hedge adjustment of $1.5 million pre-tax or $0.03 per diluted share after-tax; iii) a commercial loan charge-off related to an annual appraisal update of $1.5 million pre-tax or $0.03 per diluted share after-tax; and iv) timing-related expenses, including payroll taxes and benefits on annual incentive payouts, of $1.5 million pre-tax or $0.03 per diluted share after-tax. Excluding the impact of these items, first quarter 2023 earnings would be $0.63 per diluted share. Separately, expense savings planned for the remainder of the year represent an estimated $3.0 million pre-tax per quarter. Additionally, the Company estimates that each 25 basis point change in the Federal Funds rate could impact net interest income by approximately $1.5 million on a pre-tax annualized basis based on the Company’s balance sheet as of March 31, 2023.

“Over the course of the first quarter, the organization was fully engaged in deposit retention and expansion efforts with our consumer, wealth, commercial, and public funds clients,” said Gary Small, President and CEO of Premier. “The industry is operating in a very dynamic rate environment and we feel the impact of increasing deposit costs and margin compression when combining the Fed’s first quarter rate increases with the full quarter impact of the fourth quarter 2022 increases. Pricing and promotional adjustments over the course of the quarter resulted in a leveling off of funding costs in February and March. The well-documented industry challenges faced in March prompted additional outreach and conversation with our clients. Topics ranged from deposit insurance to safety and soundness, liquidity, and capital. The Premier team did an excellent job of sharing our organization’s strengths in these areas and by providing solutions as needed. I want to thank our clients for their confidence in the organization. March saw a slight increase in customer deposits for Premier, demonstrating the effective effort by our team of banking professionals. As outlined above, the reported earnings figure reflected a number of issues unique to the quarter. The impact was such that we felt it prudent to provide a bridge to a more normalized quarterly expectation for 2023. We have included the impact of cost reduction initiatives and the expected effect on ongoing performance. The leadership team is committed to taking appropriate steps to help offset margin challenges, while continuing to execute on strategic initiatives important to the long-term health of the organization.”

Quarterly results

Capital, deposits and liquidity

Capital and ratios continued to improve during the first quarter of 2023. Total equity increased $26.7 million, or 3%, including a $19.8 million improvement in accumulated other comprehensive income (“AOCI”) primarily due to a positive valuation adjustment on the available-for-sale (“AFS”) securities portfolio. Tangible equity increased $28.0 million, or 5%, and the tangible equity ratio increased 25 basis points to 7.03%, or 8.90% excluding AOCI. Regulatory ratios also improved during the first quarter of 2023 including CET1 of 9.96%, Tier 1 of 10.43% and Total Capital of 12.18%, each up 4-5 basis points. All of these ratios also exceed well-capitalized guidelines pro forma for AOCI, including CET1 of 7.88%, Tier 1 of 8.35% and Total Capital of 10.11%.

Total deposits declined 2% or $132.7 million during the first quarter of 2023, due to a $219.8 million decline in non-interest bearing deposits offset partly by increases of $75.9 million of interest-bearing customer deposits and $11.2 million of brokered deposits. The net decrease in non-brokered deposits occurred prior to the recent industry turmoil as total customer deposits increased by $14.2 million during the month of March. The full quarter decline in total and non-interest bearing deposits was primarily related to $107 million of funds used by commercial clients for non-recurring business dispositions and acquisitions, as well as a utilization of funds drawn on commercial lines of credit prior to year-end and then repaid in early 2023. Separately, $67 million of the decrease in non-interest-bearing deposits was due to transfers into IntraFi Cash Service (“ICS”) and other interest-bearing deposits or invested via wealth management with the Company.

Average interest-bearing deposit costs increased 62 basis points to 1.69% for the first quarter of 2023. This increase was primarily due to Public/ICS/CDARS as customers sought additional deposit insurance protection, money market accounts as a result of recent Company promotions and re-pricing, and time deposits as customers migrated to obtain yield compared to savings and checking accounts. However, the pace of increase slowed during the quarter as a result of actions taken by the Company, such that average interest-bearing deposit costs only increased two basis points to 1.79% during the month of March (from 1.77% in February), representing a cumulative beta of 35% compared to the change in the monthly average effective Federal Funds rate that increased 457 basis points to 4.65% since December 2021, as reported by the Federal Reserve Economic Data.

Uninsured deposits at March 31, 2023 were 32.3% of total deposits, or 19.6% adjusting for collateralized deposits, other uninsured deposits and internal company accounts. Total quantifiable liquidity sources totaled $2.45 billion, or 183.2% of adjusted uninsured deposits, and were comprised of the following at March 31, 2023:

  • $157.0 million of cash and cash equivalents with a 4.90% Federal Reserve rate;
  • $211.5 million of unpledged securities with an average yield of 2.97%;
  • $1.36 billion of FHLB borrowing capacity with an overnight borrowing rate of 4.86%;
  • $524.9 million of brokered deposits based on a Company policy limit of 10% of deposits, with market pricing dependent on brokers and duration;
  • $70.0 million of unused lines of credit with an average borrowing rate of 5.80%; and
  • $129.9 million of borrowing capacity at the Federal Reserve with an average rate of 4.89%.

Additional liquidity sources include deposit growth, cash earnings in excess of dividends, loan repayments/participations/sales, and securities cash flows, which are estimated to be $73.2 million over the next 12 months. Further, the Company is in the process of establishing eligibility for the Federal Reserve Borrower-In-Custody Collateral Program, which is estimated to increase borrowing capacity by at least $300 million.

Net interest income and margin

Net interest income of $56.4 million on a tax equivalent (“TE”) basis in the first quarter of 2023 was down 10% from $62.8 million in the fourth quarter of 2022 and 3% from $58.1 million in the first quarter of 2022. The TE net interest margin of 2.90% in the first quarter of 2023 decreased 38 basis points from 3.28% in the fourth quarter of 2022 and 54 basis points from 3.44% in the first quarter of 2022. Results for all periods include the impact of PPP as well as acquisition marks and related accretion. First quarter 2023 includes $166 thousand of accretion in interest income, $221 thousand of accretion in interest expense, and $6 thousand of interest income on average balances of $965 thousand for PPP.

Excluding the impact of acquisition marks accretion and PPP loans, core net interest income was $56.0 million, down 10% from $62.2 million in the fourth quarter of 2022 but up 4% from $53.7 million in the first quarter of 2022. Additionally, the core net interest margin was 2.88% for the first quarter of 2023, down 37 basis points from 3.25% for the fourth quarter of 2022 and 32 basis points from 3.20% for the first quarter of 2022. These results are positively impacted by the combination of loan growth and higher loan yields, which were 4.66% for the first quarter of 2023 compared to 4.54% in the fourth quarter of 2022 and 4.11% in the first quarter of 2022. Excluding the impact of PPP, the balance sheet hedge and acquisition marks accretion, loan yields were 4.89% in March 2023 for an increase of 117 basis points since December 2021, which represents a cumulative beta of 25% compared to the change in the monthly average effective Federal Funds rate for the same period.

The cost of funds in the first quarter of 2023 was 1.51%, up 51 basis points from the fourth quarter of 2022 and up 133 basis points from the first quarter of 2022. The year-over-year increase is largely due to utilization of higher cost FHLB borrowings in support of loan growth in excess of deposit growth during 2022. The linked quarter increase is due to higher rates on FHLB borrowings and higher average deposit costs discussed above.

“Loan balances increased 1.8% for the quarter primarily driven by funding on construction commitments made in prior periods,” Small added. “Loan growth is expected to be modest over the course of the year in light of economic uncertainties and our focus on shoring up funding costs during the year.”

Non-interest income

Total non-interest income in the first quarter of 2023 of $12.5 million was down 12% from $14.2 million in the fourth quarter of 2022 and 26% from $16.9 million in the first quarter of 2022, primarily due to fluctuations in mortgage banking and gains/losses on securities. Mortgage banking income was essentially flat on a linked quarter basis but decreased $4.5 million year-over-year as a result of a $3.4 million decrease in gains primarily from a decrease in hedge valuations and a $0.1 million MSR valuation loss in the first quarter of 2023 compared to a $1.2 million gain in the first quarter of 2022. While mortgage pipeline hedges effectively net out over the life of the loans, individual periods can be volatile as market rates and prices change. Valuations generally decrease during periods when rates decrease and/or prices increase as experienced in the first quarter of 2023. However, the valuations will generally increase over the remaining term of the related loans such that no material net impact is expected over the life of the loans.

Security losses were $1.4 million in the first quarter of 2023, primarily due to decreased valuations on equity securities. This compares to a gain of $1.2 million in the fourth quarter of 2022 from $1.3 million of gains on the sale of $8.7 million of equity securities, partially offset by $0.1 million of decreased valuations on remaining equity securities, and to $0.6 million of losses from decreased valuations on equity securities in the first quarter of 2022. The company also sold $16 million of AFS securities for a $34 thousand gain with average yields less than FHLB borrowing rates during the first quarter of 2023. Service fees in the first quarter of 2023 were $6.4 million, a 3% decrease from $6.6 million in the fourth quarter of 2022 but a 7% increase from $6.0 million in the first quarter of 2022, primarily due to fluctuations in consumer activity for interchange and ATM/NSF charges. Insurance revenues included $0.9 million in contingent commissions in the first quarter of 2023, compared to $1.1 million in the first quarter of 2022. BOLI income of $1.4 million in the first quarter of 2023 increased from $1.0 million in the fourth and first quarters of 2022 due to $0.4 million of claim gains in 2023 compared to none in the 2022 periods.

“A good start to the year on consumer fees, wealth management income and insurance,” Small added. “Mortgage origination activity in the first quarter performed at a lighter pace than previous periods, consistent with the industry.”

Non-interest expenses

Non-interest expenses in the first quarter of 2023 were $42.8 million, a 1% decrease from $43.0 million in the fourth quarter of 2022 and a 4% increase from $41.3 million in the first quarter of 2022. Compensation and benefits were $25.7 million in the first quarter of 2023, compared to $25.0 million in the fourth quarter of 2022 and $25.5 million in the first quarter of 2022. The linked quarter increase was primarily due to higher base compensation, including 2023 annual adjustments. The year-over-year increase was primarily due to costs related to higher staffing levels for our 2022 growth initiatives and higher base compensation, including 2022 mid-year adjustments. Other expenses decreased $1.1 million on a linked quarter basis due to cost saving initiatives, and all other non-interest expenses increased a net $0.2 million on a linked quarter basis. Data processing and FDIC premiums increased $0.5 million and $0.7 million on a year-over-year basis, respectively, due to our 2022 growth initiatives, and all other non-interest expenses increased a net $0.3 million on a year-over-year basis. The efficiency ratio for the first quarter of 2023 of 60.9% worsened from 56.76% in the fourth quarter of 2022 and from 54.60% in the first quarter of 2022, primarily due to lower revenues.

“Approximately $2 million of expenses in the first quarter were either non-recurring or timing related, such that our efficiency ratio would have been approximately 58% excluding those,” said Paul Nungester, CFO of Premier. “In response to the net interest margin challenges being faced, we have identified cost savings totaling approximately $9 million to be realized during the remainder of the year such that total expenses this year are now estimated to be $163 million, compared to our prior estimate of $170 million.”

Credit quality

Non-performing assets totaled $34.8 million, or 0.41% of assets, at March 31, 2023, an increase from $34.4 million at December 31, 2022, but a decrease from $47.6 million at March 31, 2022. Loan delinquencies decreased to $11.1 million, or 0.16% of loans, at March 31, 2023, from $18.3 million at December 31, 2022, but increased from $7.6 million at March 31, 2022. Classified loans totaled $44.9 million, or 0.63% of loans, as of March 31, 2023, an increase from $43.8 million at December 31, 2022, but a decrease from $60.3 million at March 31, 2022.

The 2023 first quarter results include net loan charge-offs of $2.5 million and a total provision expense of $3.7 million, compared with net loan recoveries of $0.1 million and a total provision expense of $0.9 million for the same period in 2022. The current quarter charge-offs are primarily due to an annual appraisal update for a commercial relationship that will not recur during the remainder of 2023. The allowance for credit losses as a percentage of total loans was 1.13% at March 31, 2023, compared with 1.13% at December 31, 2022, and 1.25% at March 31, 2022. The allowance for credit losses as a percentage of total loans excluding PPP and including unaccreted acquisition marks was 1.16% at March 31, 2023, compared with 1.17% at December 31, 2022, and 1.34% at March 31, 2022. The continued economic improvement following the 2020 pandemic-related downturn has resulted in a year-over-year decrease in the allowance percentages.

Total assets at $8.56 billion

Total assets at March 31, 2023, were $8.56 billion, compared to $8.46 billion at December 31, 2022, and $7.59 billion at March 31, 2022. Gross loans receivable were $6.58 billion at March 31, 2023, compared to $6.46 billion at December 31, 2022, and $5.39 billion at March 31, 2022. At March 31, 2023, gross loans receivable increased $115.2 million on a linked quarter basis, or 7% annualized. Commercial loans excluding PPP increased by $69.2 million from December 31, 2022, or 6.5% annualized. Securities at March 31, 2023, were $1.00 billion, compared to $1.05 billion at December 31, 2022, and $1.23 billion at March 31, 2022. All securities are either AFS or trading and are reflected at fair value on the balance sheet. Also, at March 31, 2023, goodwill and other intangible assets totaled $335.8 million compared to $337.1 million at December 31, 2022, and $340.6 million at March 31, 2022, with the decreases attributable to intangibles amortization.

Total non-brokered deposits at March 31, 2023, were $6.62 billion, compared with $6.76 billion at December 31, 2022, and $6.32 billion at March 31, 2022. At March 31, 2023, customer deposits increased $301.9 million on a year-over-year basis, or 5%. Brokered deposits were $154.9 million at March 31, 2023, compared to $143.7 million at December 31, 2022 and none at March 31, 2022.

Total stockholders’ equity was $914.5 million at March 31, 2023, compared to $887.7 million at December 31, 2022, and $943.3 million at March 31, 2022. The quarterly increase in stockholders’ equity was primarily due to net earnings after dividends and an increase in AOCI, which was primarily related to $14.5 million for a positive valuation adjustment on the AFS securities portfolio. The year-over-year decrease was primarily due to a decrease in AOCI, which was primarily related to $65.1 million of negative valuation adjustments on the AFS securities portfolio. At March 31, 2023, 1,199,634 common shares remained available for repurchase under the Company’s existing repurchase program.

Dividend to be paid May 12

The Board of Directors declared a quarterly cash dividend of $0.31 per common share payable May 12, 2023, to shareholders of record at the close of business on May 5, 2023. The dividend represents an annual dividend of 6.6 percent based on the Premier common stock closing price on April 24, 2023. Premier has approximately 35,706,000 common shares outstanding.

Conference call

Premier will host a conference call at 11:00 a.m. ET on Wednesday, April 26, 2023, to discuss the earnings results and business trends. The conference call may be accessed by calling 1-833-470-1428 and using access code 019302. Internet access to the call is also available (in listen-only mode) at the following URL: https://events.q4inc.com/attendee/343832535. The webcast replay of the conference call will be available at www.PremierFinCorp.com for one year.

About Premier Financial Corp.

Premier Financial Corp. (Nasdaq: PFC), headquartered in Defiance, Ohio, is the holding company for Premier Bank and First Insurance Group. Premier Bank, headquartered in Youngstown, Ohio, operates 75 branches and 10 loan offices in Ohio, Michigan, Indiana, Pennsylvania and West Virginia (West Virginia office operates as Home Savings Bank) and serves clients through a team of wealth professionals dedicated to each community banking branch. First Insurance Group is a full-service insurance agency with ten offices in Ohio. For more information, visit the company’s website at PremierFinCorp.com.

Financial Statements and Highlights Follow

Safe Harbor Statement

This document may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These statements may include, but are not limited to, statements regarding projections, forecasts, goals and plans of Premier Financial Corp. and its management, future movements of interests, loan or deposit production levels, future credit quality ratios, future strength in the market area, and growth projections. These statements do not describe historical or current facts and may be identified by words such as “intend,” “intent,” “believe,” “expect,” “estimate,” “target,” “plan,” “anticipate,” or similar words or phrases, or future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “may,” “can,” or similar verbs. There can be no assurances that the forward-looking statements included in this presentation will prove to be accurate. In light of the significant uncertainties in the forward-looking statements, the inclusion of such information should not be regarded as a representation by Premier or any other persons, that our objectives and plans will be achieved. Forward-looking statements involve numerous risks and uncertainties, any one or more of which could affect Premier’s business and financial results in future periods and could cause actual results to differ materially from plans and projections. These risks and uncertainties include, but not limited to: financial markets, our customers, and our business and results of operation; changes in interest rates; disruptions in the mortgage market; risks and uncertainties inherent in general and local banking, insurance and mortgage conditions; political uncertainty; uncertainty in U.S. fiscal or monetary policy; uncertainty concerning or disruptions relating to tensions surrounding the current socioeconomic landscape; competitive factors specific to markets in which Premier and its subsidiaries operate; increasing competition for financial products from other financial institutions and nonbank financial technology companies; future interest rate levels; legislative or regulatory rulemaking or actions; capital market conditions; security breaches or unauthorized disclosure of confidential customer or Company information; interruptions in the effective operation of information and transaction processing systems of Premier or Premier’s vendors and service providers; failures or delays in integrating or adopting new technology; the impact of the cessation of LIBOR interest rates and implementation of a replacement rate; and other risks and uncertainties detailed from time to time in our Securities and Exchange Commission (SEC) filings, including our Annual Report on Form 10-K for the year ended December 31, 2022 and any further amendments thereto. All forward-looking statements made in this presentation are based on information presently available to the management of Premier and speak only as of the date on which they are made. We assume no obligation to update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by law. As required by U.S. GAAP, Premier will evaluate the impact of subsequent events through the issuance date of its March 31, 2023, consolidated financial statements as part of its Quarterly Report on Form 10-Q to be filed with the SEC. Accordingly, subsequent events could occur that may cause Premier to update its critical accounting estimates and to revise its financial information from that which is contained in this news release.

Non-GAAP Reporting Measures

We believe that net income, as defined by U.S. GAAP, is the most appropriate earnings measurement. However, we consider core net interest income to be a useful supplemental measure of our operating performance. We define core net interest income as net interest income on a tax-equivalent basis excluding income from PPP loans and purchase accounting marks accretion. We believe that this metric is a useful supplemental measure of operating performance because investors and equity analysts may use this measure to compare the operating performance of the Company between periods or as compared to other financial institutions or other companies on a consistent basis without having to account for income from PPP loans and purchase accounting marks accretion. Our supplemental reporting measures and similarly entitled financial measures are widely used by investors, equity and debt analysts and ratings agencies in the valuation, comparison, rating and investment recommendations of companies. Our management uses these financial measures to facilitate internal and external comparisons to historical operating results and in making operating decisions. Additionally, they are utilized by the Board of Directors to evaluate management. The supplemental reporting measures do not represent net income or cash flow provided from operating activities as determined in accordance with U.S. GAAP and should not be considered as alternative measures of profitability or liquidity. Finally, the supplemental reporting measures, as defined by us, may not be comparable to similarly entitled items reported by other financial institutions or other companies. Please see the exhibits for reconciliations of our supplemental reporting measures.

Consolidated Balance Sheets (Unaudited)
Premier Financial Corp.
 

March 31,

December 31,

September 30,

June 30,

March 31,

(in thousands)

2023

2022

2022

2022

2022

 
Assets
Cash and cash equivalents
Cash and amounts due from depositories

$

68,628

 

$

88,257

 

$

67,124

 

$

62,080

 

$

62,083

 

Interest-bearing deposits

 

88,399

 

 

39,903

 

 

37,868

 

 

72,314

 

 

91,683

 

 

157,027

 

 

128,160

 

 

104,992

 

 

134,394

 

 

153,766

 

 
Available-for-sale, carried at fair value

 

998,128

 

 

1,040,081

 

 

1,063,713

 

 

1,140,466

 

 

1,219,365

 

Equity securities, carried at fair value

 

6,387

 

 

7,832

 

 

15,336

 

 

13,293

 

 

13,454

 

Securities investments

 

1,004,515

 

 

1,047,913

 

 

1,079,049

 

 

1,153,759

 

 

1,232,819

 

 
Loans (1)

 

6,575,829

 

 

6,460,620

 

 

6,207,708

 

 

5,890,823

 

 

5,388,331

 

Allowance for credit losses - loans

 

(74,273

)

 

(72,816

)

 

(70,626

)

 

(67,074

)

 

(67,195

)

Loans, net

 

6,501,556

 

 

6,387,804

 

 

6,137,082

 

 

5,823,749

 

 

5,321,136

 

Loans held for sale

 

119,604

 

 

115,251

 

 

129,142

 

 

145,092

 

 

153,498

 

Mortgage servicing rights

 

20,654

 

 

21,171

 

 

20,832

 

 

20,693

 

 

20,715

 

Accrued interest receivable

 

29,388

 

 

28,709

 

 

26,021

 

 

22,533

 

 

21,765

 

Federal Home Loan Bank stock

 

37,056

 

 

29,185

 

 

28,262

 

 

23,991

 

 

15,332

 

Bank Owned Life Insurance

 

170,841

 

 

170,713

 

 

169,728

 

 

168,746

 

 

167,763

 

Office properties and equipment

 

55,982

 

 

55,541

 

 

53,747

 

 

54,060

 

 

54,684

 

Real estate and other assets held for sale

 

393

 

 

619

 

 

416

 

 

462

 

 

253

 

Goodwill

 

317,988

 

 

317,988

 

 

317,948

 

 

317,948

 

 

317,948

 

Core deposit and other intangibles

 

17,804

 

 

19,074

 

 

19,972

 

 

21,311

 

 

22,691

 

Other assets

 

129,508

 

 

133,214

 

 

148,949

 

 

123,886

 

 

108,510

 

Total Assets

$

8,562,316

 

$

8,455,342

 

$

8,236,140

 

$

8,010,624

 

$

7,590,880

 

 
Liabilities and Stockholders’ Equity
Non-interest-bearing deposits

$

1,649,726

 

$

1,869,509

 

$

1,826,511

 

$

1,786,516

 

$

1,733,157

 

Interest-bearing deposits

 

4,969,436

 

 

4,893,502

 

 

4,836,113

 

 

4,729,828

 

 

4,584,078

 

Brokered deposits

 

154,869

 

 

143,708

 

 

69,881

 

 

-

 

 

-

 

Total deposits

 

6,774,031

 

 

6,906,719

 

 

6,732,505

 

 

6,516,344

 

 

6,317,235

 

Advances from FHLB

 

658,000

 

 

428,000

 

 

411,000

 

 

380,000

 

 

150,000

 

Subordinated debentures

 

85,123

 

 

85,103

 

 

85,071

 

 

85,039

 

 

85,008

 

Advance payments by borrowers

 

26,300

 

 

34,188

 

 

33,511

 

 

40,344

 

 

20,332

 

Reserve for credit losses - unfunded commitments

 

6,577

 

 

6,816

 

 

7,061

 

 

6,755

 

 

5,340

 

Other liabilities

 

97,835

 

 

106,795

 

 

102,032

 

 

80,995

 

 

69,669

 

Total Liabilities

 

7,647,866

 

 

7,567,621

 

 

7,371,180

 

 

7,109,477

 

 

6,647,584

 

Stockholders’ Equity
Preferred stock

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Common stock, net

 

306

 

 

306

 

 

306

 

 

306

 

 

306

 

Additional paid-in-capital

 

689,807

 

 

691,453

 

 

691,578

 

 

690,905

 

 

691,350

 

Accumulated other comprehensive income (loss)

 

(153,709

)

 

(173,460

)

 

(181,231

)

 

(126,754

)

 

(75,497

)

Retained earnings

 

510,021

 

 

502,909

 

 

488,305

 

 

470,779

 

 

459,087

 

Treasury stock, at cost

 

(131,975

)

 

(133,487

)

 

(133,998

)

 

(134,089

)

 

(131,950

)

Total Stockholders’ Equity

 

914,450

 

 

887,721

 

 

864,960

 

 

901,147

 

 

943,296

 

Total Liabilities and Stockholders’ Equity

$

8,562,316

 

$

8,455,342

 

$

8,236,140

 

$

8,010,624

 

$

7,590,880

 

 
(1) Includes PPP loans of:

$

791

 

$

1,143

 

$

1,181

 

$

4,561

 

$

18,660

 

Consolidated Statements of Income (Unaudited)
Premier Financial Corp.
Three Months Ended Three Months Ended
(in thousands, except per share amounts) 3/31/23 12/31/22 9/30/22 6/30/22 3/31/22 3/31/23 3/31/22
Interest Income:
Loans

$

76,057

 

$

72,194

 

$

65,559

$

56,567

 

$

55,241

 

$

76,057

 

$

55,241

 

Investment securities

 

7,261

 

 

7,605

 

 

6,814

 

6,197

 

 

5,479

 

 

7,261

 

 

5,479

 

Interest-bearing deposits

 

444

 

 

444

 

 

221

 

120

 

 

46

 

 

444

 

 

46

 

FHLB stock dividends

 

394

 

 

482

 

 

510

 

174

 

 

59

 

 

394

 

 

59

 

Total interest income

 

84,156

 

 

80,725

 

 

73,104

 

63,058

 

 

60,825

 

 

84,156

 

 

60,825

 

Interest Expense:
Deposits

 

21,458

 

 

13,161

 

 

6,855

 

2,671

 

 

2,222

 

 

21,458

 

 

2,222

 

FHLB advances

 

5,336

 

 

3,941

 

 

2,069

 

527

 

 

13

 

 

5,336

 

 

13

 

Subordinated debentures

 

1,075

 

 

1,000

 

 

868

 

763

 

 

696

 

 

1,075

 

 

696

 

Notes Payable

 

-

 

 

4

 

 

-

 

1

 

 

-

 

 

-

 

 

-

 

Total interest expense

 

27,869

 

 

18,106

 

 

9,792

 

3,962

 

 

2,931

 

 

27,869

 

 

2,931

 

Net interest income

 

56,287

 

 

62,619

 

 

63,312

 

59,096

 

 

57,894

 

 

56,287

 

 

57,894

 

Provision (benefit) for credit losses - loans

 

3,944

 

 

3,020

 

 

3,706

 

5,151

 

 

626

 

 

3,944

 

 

626

 

Provision (benefit) for credit losses - unfunded

commitments

 

(238

)

 

(246

)

 

306

 

1,415

 

 

309

 

 

(238

)

 

309

 

Total provision (benefit) for credit losses

 

3,706

 

 

2,774

 

 

4,012

 

6,566

 

 

935

 

 

3,706

 

 

935

 

Net interest income after provision

 

52,581

 

 

59,845

 

 

59,300

 

52,530

 

 

56,959

 

 

52,581

 

 

56,959

 

Non-interest Income:
Service fees and other charges

 

6,428

 

 

6,632

 

 

6,545

 

6,676

 

 

6,000

 

 

6,428

 

 

6,000

 

Mortgage banking income

 

(274

)

 

(299

)

 

3,970

 

1,948

 

 

4,252

 

 

(274

)

 

4,252

 

Gain (loss) on sale of available for sale securities

 

34

 

 

1

 

 

-

 

-

 

 

-

 

 

34

 

 

-

 

Gain (loss) on equity securities

 

(1,445

)

 

1,209

 

 

43

 

(1,161

)

 

(643

)

 

(1,445

)

 

(643

)

Insurance commissions

 

4,725

 

 

3,576

 

 

3,488

 

4,334

 

 

4,639

 

 

4,725

 

 

4,639

 

Wealth management income

 

1,485

 

 

1,582

 

 

1,355

 

1,414

 

 

1,477

 

 

1,485

 

 

1,477

 

Income from Bank Owned Life Insurance

 

1,417

 

 

984

 

 

983

 

983

 

 

996

 

 

1,417

 

 

996

 

Other non-interest income

 

92

 

 

543

 

 

320

 

171

 

 

142

 

 

92

 

 

142

 

Total Non-interest Income

 

12,462

 

 

14,228

 

 

16,704

 

14,365

 

 

16,863

 

 

12,462

 

 

16,863

 

Non-interest Expense:
Compensation and benefits

 

25,658

 

 

24,999

 

 

24,522

 

22,334

 

 

25,541

 

 

25,658

 

 

25,541

 

Occupancy

 

3,574

 

 

3,383

 

 

3,463

 

3,494

 

 

3,700

 

 

3,574

 

 

3,700

 

FDIC insurance premium

 

1,288

 

 

1,276

 

 

976

 

802

 

 

593

 

 

1,288

 

 

593

 

Financial institutions tax

 

852

 

 

795

 

 

1,050

 

1,074

 

 

1,191

 

 

852

 

 

1,191

 

Data processing

 

3,863

 

 

3,882

 

 

3,121

 

3,442

 

 

3,335

 

 

3,863

 

 

3,335

 

Amortization of intangibles

 

1,270

 

 

1,293

 

 

1,338

 

1,380

 

 

1,438

 

 

1,270

 

 

1,438

 

Other non-interest expense

 

6,286

 

 

7,400

 

 

6,629

 

6,563

 

 

5,497

 

 

6,286

 

 

5,497

 

Total Non-interest Expense

 

42,791

 

 

43,028

 

 

41,099

 

39,089

 

 

41,295

 

 

42,791

 

 

41,295

 

Income before income taxes

 

22,252

 

 

31,045

 

 

34,905

 

27,806

 

 

32,527

 

 

22,252

 

 

32,527

 

Income tax expense

 

4,103

 

 

5,770

 

 

6,710

 

5,446

 

 

6,170

 

 

4,103

 

 

6,170

 

Net Income

$

18,149

 

$

25,275

 

$

28,195

$

22,360

 

$

26,357

 

$

18,149

 

$

26,357

 

 
 
Earnings per common share:
Basic

$

0.51

 

$

0.71

 

$

0.79

$

0.63

 

$

0.73

 

$

0.51

 

$

0.73

 

Diluted

$

0.51

 

$

0.71

 

$

0.79

$

0.63

 

$

0.73

 

$

0.51

 

$

0.73

 

 
Average Shares Outstanding:
Basic

 

35,606

 

 

35,589

 

 

35,582

 

35,560

 

 

35,978

 

 

35,606

 

 

35,978

 

Diluted

 

35,719

 

 

35,790

 

 

35,704

 

35,682

 

 

36,090

 

 

35,719

 

 

36,090

 

Premier Financial Corp.
Selected Quarterly Information
As of and for the Three Months Ended Three Months Ended
(dollars in thousands,

except per share data)
3/31/23 12/31/22 9/30/22 6/30/22 3/31/22 3/31/23 3/31/22
Summary of Operations
Tax-equivalent interest income (1)

$

84,260

 

$

80,889

 

$

73,301

 

$

63,283

 

$

61,054

 

$

84,260

 

$

61,054

 

Interest expense

 

27,869

 

 

18,106

 

 

9,792

 

 

3,962

 

 

2,931

 

 

27,869

 

 

2,931

 

Tax-equivalent net interest income (1)

 

56,391

 

 

62,783

 

 

63,509

 

 

59,321

 

 

58,123

 

 

56,391

 

 

58,123

 

Provision expense (benefit) for credit losses

 

3,706

 

 

2,774

 

 

4,012

 

 

6,566

 

 

935

 

 

3,706

 

 

935

 

Investment securities gains (losses)

 

(1,411

)

 

1,210

 

 

43

 

 

(1,161

)

 

(643

)

 

(1,411

)

 

(643

)

Non-interest income (ex securities gains/losses)

 

13,873

 

 

13,018

 

 

16,661

 

 

15,526

 

 

17,506

 

 

13,873

 

 

17,506

 

Non-interest expense

 

42,791

 

 

43,028

 

 

41,099

 

 

39,089

 

 

41,295

 

 

42,791

 

 

41,295

 

Income tax expense

 

4,103

 

 

5,770

 

 

6,710

 

 

5,446

 

 

6,170

 

 

4,103

 

 

6,170

 

Net income

 

18,149

 

 

25,275

 

 

28,195

 

 

22,360

 

 

26,357

 

 

18,149

 

 

26,357

 

Tax equivalent adjustment (1)

 

104

 

 

164

 

 

197

 

 

225

 

 

229

 

 

104

 

 

229

 

At Period End
Total assets

$

8,562,316

 

$

8,455,342

 

$

8,236,140

 

$

8,010,624

 

$

7,590,880

 

Goodwill and intangibles

 

335,792

 

 

337,062

 

 

337,920

 

 

339,259

 

 

340,639

 

Tangible assets (2)

 

8,226,524

 

 

8,118,280

 

 

7,898,220

 

 

7,671,365

 

 

7,250,241

 

Earning assets

 

7,751,130

 

 

7,620,056

 

 

7,411,403

 

 

7,218,905

 

 

6,881,663

 

Loans

 

6,575,829

 

 

6,460,620

 

 

6,207,708

 

 

5,890,823

 

 

5,388,331

 

Allowance for loan losses

 

74,273

 

 

72,816

 

 

70,626

 

 

67,074

 

 

67,195

 

Deposits

 

6,774,031

 

 

6,906,719

 

 

6,732,505

 

 

6,516,344

 

 

6,317,235

 

Stockholders’ equity

 

914,450

 

 

887,721

 

 

864,960

 

 

901,147

 

 

943,296

 

Stockholders’ equity / assets

 

10.68

%

 

10.50

%

 

10.50

%

 

11.25

%

 

12.43

%

Tangible equity (2)

 

578,658

 

 

550,659

 

 

527,040

 

 

561,888

 

 

602,657

 

Tangible equity / tangible assets

 

7.03

%

 

6.78

%

 

6.67

%

 

7.32

%

 

8.31

%

Average Balances
Total assets

$

8,433,100

 

$

8,304,462

 

$

8,161,389

 

$

7,742,550

 

$

7,541,414

 

$

8,433,100

 

$

7,541,414

 

Earning assets

 

7,783,850

 

 

7,653,648

 

 

7,477,795

 

 

7,051,661

 

 

6,754,862

 

 

7,783,850

 

 

6,754,862

 

Loans

 

6,535,080

 

 

6,359,564

 

 

6,120,324

 

 

5,667,853

 

 

5,382,825

 

 

6,535,080

 

 

5,382,825

 

Deposits and interest-bearing liabilities

 

7,385,946

 

 

7,278,531

 

 

7,116,910

 

 

6,706,250

 

 

6,415,483

 

 

7,385,946

 

 

6,415,483

 

Deposits

 

6,833,521

 

 

6,773,382

 

 

6,654,328

 

 

6,385,857

 

 

6,314,217

 

 

6,833,521

 

 

6,314,217

 

Stockholders’ equity

 

901,587

 

 

875,287

 

 

912,224

 

 

921,847

 

 

1,033,816

 

 

901,587

 

 

1,033,816

 

Goodwill and intangibles

 

336,418

 

 

337,207

 

 

338,583

 

 

339,932

 

 

341,353

 

 

336,418

 

 

341,353

 

Tangible equity (2)

 

565,169

 

 

538,080

 

 

573,641

 

 

581,915

 

 

692,463

 

 

565,169

 

 

692,463

 

Per Common Share Data
Net Income (Loss):
Basic

$

0.51

 

$

0.71

 

$

0.79

 

$

0.63

 

$

0.73

 

$

0.51

 

$

0.73

 

Diluted

 

0.51

 

 

0.71

 

 

0.79

 

 

0.63

 

 

0.73

 

 

0.51

 

 

0.73

 

Dividends Paid

 

0.31

 

 

0.30

 

 

0.30

 

 

0.30

 

 

0.30

 

 

0.31

 

 

0.30

 

Market Value:
High

$

27.80

 

$

30.51

 

$

29.36

 

$

30.13

 

$

32.52

 

$

27.80

 

$

32.52

 

Low

 

20.39

 

 

26.11

 

 

24.67

 

 

25.31

 

 

28.58

 

 

20.39

 

 

28.58

 

Close

 

20.73

 

 

26.97

 

 

25.70

 

 

25.35

 

 

30.33

 

 

20.73

 

 

30.33

 

Common Book Value

 

25.61

 

 

24.94

 

 

24.32

 

 

25.35

 

 

26.48

 

Tangible Common Book Value (2)

 

16.21

 

 

15.47

 

 

14.82

 

 

15.80

 

 

16.92

 

Shares outstanding, end of period (000s)

 

35,701

 

 

35,591

 

 

35,563

 

 

35,555

 

 

35,621

 

Performance Ratios (annualized)
Tax-equivalent net interest margin (1)

 

2.90

%

 

3.28

%

 

3.40

%

 

3.36

%

 

3.44

%

 

2.90

%

 

3.39

%

Return on average assets

 

0.87

%

 

1.21

%

 

1.37

%

 

1.16

%

 

1.42

%

 

0.22

%

 

1.68

%

Return on average equity

 

8.16

%

 

11.46

%

 

12.26

%

 

9.73

%

 

10.34

%

 

2.01

%

 

12.49

%

Return on average tangible equity

 

13.02

%

 

18.64

%

 

19.50

%

 

15.41

%

 

15.44

%

 

3.21

%

 

18.99

%

Efficiency ratio (3)

 

60.90

%

 

56.76

%

 

51.26

%

 

52.23

%

 

54.60

%

 

60.90

%

 

54.60

%

Effective tax rate

 

18.44

%

 

18.59

%

 

19.22

%

 

19.59

%

 

18.97

%

 

18.44

%

 

19.42

%

Common dividend payout ratio

 

60.78

%

 

42.25

%

 

37.97

%

 

47.62

%

 

41.10

%

 

60.78

%

 

30.97

%

 
(1) Interest income on tax-exempt securities and loans has been adjusted to a tax-equivalent basis using the statutory federal income tax rate of 21%.
(2) Tangible assets = total assets less the sum of goodwill and core deposit and other intangibles. Tangible equity = total stockholders' equity less the sum of goodwill, core deposit and other intangibles, and preferred stock. Tangible common book value = tangible equity divided by shares outstanding at the end of the period.
(3) Efficiency ratio = Non-interest expense divided by sum of tax-equivalent net interest income plus non-interest income, excluding securities gains or losses, net.
Premier Financial Corp.
Yield Analysis
(dollars in thousands) Three Months Ended
3/31/23 12/31/22 9/30/22 6/30/22 3/31/22
Average Balances
Interest-earning assets:
Loans receivable (1)

$

6,535,080

 

$

6,359,564

 

$

6,120,324

 

$

5,667,853

 

$

5,382,825

 

Securities

 

1,183,361

 

 

1,235,814

 

 

1,261,527

 

 

1,288,073

 

 

1,250,321

 

Interest Bearing Deposits

 

35,056

 

 

29,884

 

 

68,530

 

 

76,401

 

 

109,757

 

FHLB stock

 

30,353

 

 

28,386

 

 

27,414

 

 

19,334

 

 

11,959

 

Total interest-earning assets

 

7,783,850

 

 

7,653,648

 

 

7,477,795

 

 

7,051,661

 

 

6,754,862

 

Non-interest-earning assets

 

649,250

 

 

650,814

 

 

683,594

 

 

690,889

 

 

786,552

 

Total assets

$

8,433,100

 

$

8,304,462

 

$

8,161,389

 

$

7,742,550

 

$

7,541,414

 

Deposits and Interest-bearing Liabilities:
Interest bearing deposits

$

5,078,510

 

$

4,901,412

 

$

4,846,419

 

$

4,614,223

 

$

4,600,801

 

FHLB advances and other

 

467,311

 

 

419,761

 

 

377,533

 

 

234,945

 

 

16,278

 

Subordinated debentures

 

85,114

 

 

85,084

 

 

85,049

 

 

85,020

 

 

84,988

 

Notes payable

 

-

 

 

304

 

 

-

 

 

428

 

 

-

 

Total interest-bearing liabilities

 

5,630,935

 

 

5,406,561

 

 

5,309,001

 

 

4,934,616

 

 

4,702,067

 

Non-interest bearing deposits

 

1,755,011

 

 

1,871,970

 

 

1,807,909

 

 

1,771,634

 

 

1,713,416

 

Total including non-interest-bearing deposits

 

7,385,946

 

 

7,278,531

 

 

7,116,910

 

 

6,706,250

 

 

6,415,483

 

Other non-interest-bearing liabilities

 

145,567

 

 

150,644

 

 

132,255

 

 

114,453

 

 

92,115

 

Total liabilities

 

7,531,513

 

 

7,429,175

 

 

7,249,165

 

 

6,820,703

 

 

6,507,598

 

Stockholders' equity

 

901,587

 

 

875,287

 

 

912,224

 

 

921,847

 

 

1,033,816

 

Total liabilities and stockholders' equity

$

8,433,100

 

$

8,304,462

 

$

8,161,389

 

$

7,742,550

 

$

7,541,414

 

IEAs/IBLs

 

138

%

 

142

%

 

141

%

 

143

%

 

144

%

Interest Income/Expense
Interest-earning assets:
Loans receivable (2)

$

76,063

 

$

72,201

 

$

65,564

 

$

56,573

 

$

55,248

 

Securities (2)

 

7,359

 

 

7,762

 

 

7,006

 

 

6,416

 

 

5,701

 

Interest Bearing Deposits

 

444

 

 

444

 

 

221

 

 

120

 

 

46

 

FHLB stock

 

394

 

 

482

 

 

510

 

 

174

 

 

59

 

Total interest-earning assets

 

84,260

 

 

80,889

 

 

73,301

 

 

63,283

 

 

61,054

 

Deposits and Interest-bearing Liabilities:
Interest bearing deposits

$

21,458

 

$

13,161

 

$

6,855

 

$

2,671

 

$

2,222

 

FHLB advances and other

 

5,336

 

 

3,941

 

 

2,069

 

 

527

 

 

13

 

Subordinated debentures

 

1,075

 

 

1,001

 

 

868

 

 

763

 

 

696

 

Notes payable

 

-

 

 

3

 

 

-

 

 

1

 

 

-

 

Total interest-bearing liabilities

 

27,869

 

 

18,106

 

 

9,792

 

 

3,962

 

 

2,931

 

Non-interest bearing deposits

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Total including non-interest-bearing deposits

 

27,869

 

 

18,106

 

 

9,792

 

 

3,962

 

 

2,931

 

Net interest income

$

56,391

 

$

62,783

 

$

63,509

 

$

59,321

 

$

58,123

 

Less: PPP income

 

(6

)

 

(6

)

 

(26

)

 

(160

)

 

(3,641

)

Less: Acquisition marks accretion

 

(387

)

 

(554

)

 

(608

)

 

(706

)

 

(737

)

Core net interest income

$

55,998

 

$

62,223

 

$

62,875

 

$

58,455

 

$

53,745

 

Annualized Average Rates
Interest-earning assets:
Loans receivable

 

4.66

%

 

4.54

%

 

4.29

%

 

3.99

%

 

4.11

%

Securities (3)

 

2.49

%

 

2.51

%

 

2.22

%

 

1.99

%

 

1.82

%

Interest Bearing Deposits

 

5.07

%

 

5.94

%

 

1.29

%

 

0.63

%

 

0.17

%

FHLB stock

 

5.19

%

 

6.79

%

 

7.44

%

 

3.60

%

 

1.97

%

Total interest-earning assets

 

4.33

%

 

4.23

%

 

3.92

%

 

3.59

%

 

3.62

%

Deposits and Interest-bearing Liabilities:
Interest bearing deposits

 

1.69

%

 

1.07

%

 

0.57

%

 

0.23

%

 

0.19

%

FHLB advances and other

 

4.57

%

 

3.76

%

 

2.19

%

 

0.90

%

 

0.32

%

Subordinated debentures

 

5.05

%

 

4.71

%

 

4.08

%

 

3.59

%

 

3.28

%

Notes payable

 

-

 

 

3.95

%

 

-

 

 

0.93

%

 

-

 

Total interest-bearing liabilities

 

1.98

%

 

1.34

%

 

0.74

%

 

0.32

%

 

0.25

%

Non-interest bearing deposits

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Total including non-interest-bearing deposits

 

1.51

%

 

1.00

%

 

0.55

%

 

0.24

%

 

0.18

%

Net interest spread

 

2.35

%

 

2.89

%

 

3.18

%

 

3.27

%

 

3.37

%

Net interest margin (4)

 

2.90

%

 

3.28

%

 

3.40

%

 

3.36

%

 

3.44

%

Core net interest margin (4)

 

2.88

%

 

3.25

%

 

3.36

%

 

3.32

%

 

3.20

%

(1) Includes average PPP loans of:

$

965

 

$

1,160

 

$

1,889

 

$

12,966

 

$

32,853

 

(2) Interest on certain tax exempt loans and securities is not taxable for Federal income tax purposes. In order to compare the tax-exempt yields on these assets to taxable yields, the interest earned on these assets is adjusted to a pre-tax equivalent amount based on the marginal corporate federal income tax rate of 21%.
(3) Securities yield = annualized interest income divided by the average balance of securities, excluding average unrealized gains/losses.
(4) Net interest margin is tax equivalent net interest income divided by average interest-earning assets. Core net interest margin represents net interest margin excluding PPP and acquisition marks accretion.
Premier Financial Corp.
Deposits and Liquidity
(dollars in thousands)
As of and for the Three Months Ended
3/31/23 12/31/22 9/30/22 6/30/22 3/31/22
Ending Balances
Non-interest-bearing demand deposits

$

1,649,726

 

$

1,869,509

 

$

1,826,511

 

$

1,786,516

 

$

1,733,157

 

Savings deposits

 

775,186

 

 

797,376

 

 

817,853

 

 

830,048

 

 

827,078

 

Interest-bearing demand deposits

 

646,329

 

 

653,960

 

 

665,974

 

 

662,337

 

 

674,306

 

Money market account deposits

 

1,342,451

 

 

1,493,729

 

 

1,463,600

 

 

1,511,990

 

 

1,477,133

 

Time deposits

 

856,720

 

 

768,678

 

 

630,077

 

 

587,918

 

 

604,368

 

Public funds, ICS and CDARS deposits

 

1,348,750

 

 

1,179,759

 

 

1,258,610

 

 

1,137,536

 

 

1,001,193

 

Brokered deposits

 

154,869

 

 

143,708

 

 

69,881

 

 

-

 

 

-

 

Total deposits

$

6,774,031

 

$

6,906,719

 

$

6,732,505

 

$

6,516,344

 

$

6,317,235

 

 
Average Balances
Non-interest-bearing demand deposits

$

1,755,011

 

$

1,871,970

 

$

1,807,909

 

$

1,771,634

 

$

1,713,416

 

Savings deposits

 

782,215

 

 

806,653

 

 

825,673

 

 

833,323

 

 

816,720

 

Interest-bearing demand deposits

 

637,423

 

 

651,685

 

 

681,247

 

 

681,798

 

 

699,216

 

Money market account deposits

 

1,430,905

 

 

1,418,549

 

 

1,493,019

 

 

1,498,218

 

 

1,680,520

 

Time deposits

 

825,652

 

 

685,453

 

 

610,708

 

 

597,613

 

 

706,881

 

Public funds, ICS and CDARS deposits

 

1,232,230

 

 

1,235,772

 

 

1,204,968

 

 

1,003,271

 

 

697,464

 

Brokered deposits

 

170,085

 

 

103,300

 

 

30,804

 

 

-

 

 

-

 

Total deposits

$

6,833,521

 

$

6,773,382

 

$

6,654,328

 

$

6,385,857

 

$

6,314,217

 

 
Average Rates
Non-interest-bearing demand deposits

 

0.00

%

 

0.00

%

 

0.00

%

 

0.00

%

 

0.00

%

Savings deposits

 

0.02

%

 

0.02

%

 

0.02

%

 

0.02

%

 

0.02

%

Interest-bearing demand deposits

 

0.07

%

 

0.07

%

 

0.07

%

 

0.05

%

 

0.05

%

Money market account deposits

 

1.54

%

 

0.81

%

 

0.40

%

 

0.18

%

 

0.16

%

Time deposits

 

1.83

%

 

1.05

%

 

0.58

%

 

0.45

%

 

0.49

%

Public funds, ICS and CDARS deposits

 

3.32

%

 

2.41

%

 

1.38

%

 

0.48

%

 

0.31

%

Brokered deposits

 

4.19

%

 

3.32

%

 

2.37

%

 

-

 

 

-

 

Total deposits

 

1.26

%

 

0.78

%

 

0.41

%

 

0.17

%

 

0.14

%

 
Other Deposits Data
Loans/Deposits Ratio

 

97.1

%

 

93.5

%

 

92.2

%

 

90.4

%

 

85.3

%

Uninsured deposits %

 

32.3

%

 

35.3

%

 

35.5

%

 

34.2

%

 

30.3

%

Adjusted uninsured deposits % (1)

 

19.6

%

 

22.2

%

 

22.2

%

 

22.0

%

 

20.5

%

Top 20 depositors %

 

12.1

%

 

5.4

%

 

11.3

%

 

10.0

%

 

6.8

%

Public funds %

 

16.5

%

 

14.8

%

 

15.9

%

 

14.1

%

 

11.4

%

Average account size (excluding brokered)

$

27.0

 

$

27.8

 

$

27.5

 

$

26.9

 

$

25.9

 

 
Securities Data
Held-to-maturity (HTM) at fair value

$

-

 

$

-

 

$

-

 

$

-

 

$

-

 

Available-for-sale (AFS) at fair value (2)

 

998,128

 

 

1,040,081

 

 

1,063,713

 

 

1,140,466

 

 

1,219,365

 

Equity investment at fair value (3)

 

6,387

 

 

7,832

 

 

15,336

 

 

13,293

 

 

13,454

 

Total securities at fair value

$

1,004,515

 

$

1,047,913

 

$

1,079,049

 

$

1,153,759

 

$

1,232,819

 

Cash+Securities/Assets

 

13.6

%

 

13.9

%

 

14.4

%

 

16.1

%

 

18.3

%

Projected AFS cash flow in next 12 months

$

73,184

 

$

73,319

 

$

76,119

 

$

74,558

 

$

85,910

 

AFS average life (years)

 

6.4

 

 

6.5

 

 

6.6

 

 

6.8

 

 

6.6

 

 
Liquidity Sources
Cash and cash equivalents

$

157,027

 

$

128,160

 

$

104,992

 

$

134,394

 

$

153,766

 

Unpledged securities at fair value

 

211,468

 

 

288,134

 

 

342,979

 

 

572,892

 

 

677,918

 

FHLB borrowing capacity

 

1,358,650

 

 

1,528,978

 

 

1,217,516

 

 

1,044,477

 

 

1,274,743

 

Brokered deposits (Company policy limit of 10%)

 

524,889

 

 

549,370

 

 

605,552

 

 

654,380

 

 

634,318

 

Bank and parent lines of credit

 

70,000

 

 

70,000

 

 

70,000

 

 

45,000

 

 

45,000

 

Federal Reserve - Discount Window and BTFP (4)

 

129,918

 

 

44,471

 

 

-

 

 

-

 

 

-

 

Total

$

2,451,952

 

$

2,609,113

 

$

2,341,039

 

$

2,451,143

 

$

2,785,745

 

Total liquidity to adjusted uninsured deposits ratio

 

183.2

%

 

168.9

%

 

155.4

%

 

169.0

%

 

213.1

%

 
(1) Adjusted for collateralized deposits, other insured deposits and intra-company accounts.
(2) Mark-to-market included in accumulated other comprehensive income.
(3) Mark-to-market included in net income each quarter.
(4) Includes borrowing capacity related to unpledged securities at par value in excess of fair value under Bank Term Funding Program.
Premier Financial Corp.
Loans and Capital
(dollars in thousands)
3/31/23 12/31/22 9/30/22 6/30/22 3/31/22
Loan Portfolio Composition
Residential real estate

$

1,624,331

 

$

1,535,574

 

$

1,478,360

 

$

1,382,202

 

$

1,222,057

 

Residential real estate construction

 

141,209

 

 

176,737

 

 

119,204

 

 

85,256

 

 

97,746

 

Total residential loans

 

1,765,540

 

 

1,712,311

 

 

1,597,564

 

 

1,467,458

 

 

1,319,803

 

 
Commercial real estate

 

2,813,441

 

 

2,762,311

 

 

2,674,078

 

 

2,655,730

 

 

2,495,469

 

Commercial construction

 

440,510

 

 

428,743

 

 

398,044

 

 

319,590

 

 

260,421

 

Commercial excluding PPP

 

1,060,351

 

 

1,054,037

 

 

1,041,423

 

 

987,242

 

 

891,893

 

Core commercial loans (1)

 

4,314,302

 

 

4,245,091

 

 

4,113,545

 

 

3,962,562

 

 

3,647,783

 

 
Consumer direct/indirect

 

212,299

 

 

213,405

 

 

212,790

 

 

180,539

 

 

132,294

 

Home equity and improvement lines

 

271,676

 

 

277,613

 

 

272,367

 

 

266,144

 

 

261,176

 

Total consumer loans

 

483,975

 

 

491,018

 

 

485,157

 

 

446,683

 

 

393,470

 

 
Deferred loan origination fees

 

11,221

 

 

11,057

 

 

10,261

 

 

9,559

 

 

8,615

 

Core loans (1)

 

6,575,038

 

 

6,459,477

 

 

6,206,527

 

 

5,886,262

 

 

5,369,671

 

PPP loans

 

791

 

 

1,143

 

 

1,181

 

 

4,561

 

 

18,660

 

Total loans

$

6,575,829

 

$

6,460,620

 

$

6,207,708

 

$

5,890,823

 

$

5,388,331

 

 
Loans held for sale

$

119,631

 

$

115,251

 

$

129,142

 

$

145,092

 

$

153,498

 

Core residential loans (1)

 

1,885,171

 

 

1,827,562

 

 

1,726,706

 

 

1,612,550

 

 

1,473,301

 

Total loans including loans held for sale but excluding PPP

 

6,694,669

 

 

6,574,728

 

 

6,335,669

 

 

6,031,354

 

 

5,523,169

 

 
Undisbursed construction loan funds - residential

$

157,934

 

$

209,306

 

$

231,598

 

$

239,748

 

$

210,702

 

Undisbursed construction loan funds - commercial

 

446,294

 

 

463,469

 

 

493,199

 

 

449,101

 

 

314,843

 

Undisbursed construction loan funds - total

 

604,228

 

 

672,775

 

 

724,797

 

 

688,849

 

 

525,545

 

Total construction loans including undisbursed funds

$

1,185,947

 

$

1,278,255

 

$

1,242,045

 

$

1,093,695

 

$

883,712

 

Gross loans (2)

$

7,168,836

 

$

7,122,338

 

$

6,922,244

 

$

6,570,113

 

$

5,905,261

 

 
Fixed rate loans %

 

49.5

%

 

48.8

%

 

48.7

%

 

47.4

%

 

45.5

%

Floating rate loans %

 

13.4

%

 

14.3

%

 

16.0

%

 

18.3

%

 

21.8

%

Adjustable rate loans repricing within 1 year %

 

2.0

%

 

2.6

%

 

0.8

%

 

2.5

%

 

3.3

%

Adjustable rate loans repricing over 1 year %

 

35.1

%

 

34.3

%

 

34.5

%

 

31.8

%

 

29.4

%

 
Commercial Real Estate Loans Composition
Non owner occupied excluding office

$

947,442

 

$

934,760

 

$

905,512

 

$

899,129

 

$

843,775

 

Non owner occupied office

 

220,668

 

 

222,300

 

 

203,565

 

 

210,164

 

 

210,258

 

Owner occupied excluding office

 

609,203

 

 

578,514

 

 

570,662

 

 

556,482

 

 

558,802

 

Owner occupied office

 

109,014

 

 

108,087

 

 

105,224

 

 

104,968

 

 

97,880

 

Multifamily

 

661,996

 

 

660,823

 

 

637,701

 

 

634,782

 

 

569,216

 

Agriculture land

 

122,384

 

 

125,384

 

 

122,416

 

 

120,633

 

 

113,883

 

Other commercial real estate

 

142,734

 

 

132,443

 

 

128,998

 

 

129,572

 

 

101,655

 

Total commercial real estate loans

$

2,813,441

 

$

2,762,311

 

$

2,674,078

 

$

2,655,730

 

$

2,495,469

 

 
Capital Balances
Total equity

$

914,450

 

$

887,721

 

$

864,960

 

$

901,147

 

$

943,296

 

Less: Regulatory goodwill and intangibles

 

330,711

 

 

331,981

 

 

332,839

 

 

334,177

 

 

335,558

 

Less: Accumulated other comprehensive income/(loss) ("AOCI")

 

(153,709

)

 

(173,460

)

 

(181,231

)

 

(126,754

)

 

(75,497

)

Common equity tier 1 capital ("CET1")

 

737,448

 

 

729,200

 

 

713,352

 

 

693,724

 

 

683,235

 

Add: Tier 1 subordinated debt

 

35,000

 

 

35,000

 

 

35,000

 

 

35,000

 

 

35,000

 

Tier 1 capital

 

772,448

 

 

764,200

 

 

748,352

 

 

728,724

 

 

718,235

 

Add: Regulatory allowances

 

80,003

 

 

78,780

 

 

76,530

 

 

72,648

 

 

70,949

 

Add: Tier 2 subordinated debt

 

50,000

 

 

50,000

 

 

50,000

 

 

50,000

 

 

50,000

 

Total risk-based capital

$

902,451

 

$

892,980

 

$

874,882

 

$

851,372

 

$

839,184

 

 
Total risk-weighted assets

$

7,407,117

 

$

7,355,979

 

$

7,385,877

 

$

7,095,366

 

$

6,629,166

 

 
Capital Ratios
CET1 Ratio

 

9.96

%

 

9.91

%

 

9.66

%

 

9.78

%

 

10.31

%

CET1 Ratio including AOCI

 

7.88

%

 

7.55

%

 

7.20

%

 

7.99

%

 

9.17

%

Tier 1 Capital Ratio

 

10.43

%

 

10.39

%

 

10.13

%

 

10.27

%

 

10.83

%

Tier 1 Capital Ratio including AOCI

 

8.35

%

 

8.03

%

 

7.68

%

 

8.48

%

 

9.70

%

Total Capital Ratio

 

12.18

%

 

12.14

%

 

11.85

%

 

12.00

%

 

12.66

%

Total Capital Ratio including AOCI

 

10.11

%

 

9.78

%

 

9.39

%

 

10.21

%

 

11.52

%

 
(1) Core loans represents total loans excluding undisbursed loan funds, deferred loan origination fees and PPP loans. Core commercial loans represents total commercial real estate, commercial and commercial construction excluding commercial undisbursed loan funds, deferred loan origination fees and PPP loans. Core residential loans represents total loans held for sale, one to four family residential real estate and residential construction excluding residential undisbursed loan funds and deferred loan origination fees.
(2) Gross loans represent total loans including undisbursed construction funds but excluding deferred loan origination fees.
Premier Financial Corp.
Loan Delinquency Information
 
(dollars in thousands) Total Balance Current 30 to 89 days past due % of Total Non Accrual Loans % of Total
 
March 31, 2023
One to four family residential real estate

$

1,624,331

$

1,611,658

$

4,514

0.28

%

$

8,159

0.50

%

Construction

 

1,185,947

 

1,185,803

 

144

0.01

%

 

-

0.00

%

Commercial real estate

 

2,813,441

 

2,799,007

 

88

0.00

%

 

14,346

0.51

%

Commercial

 

1,061,142

 

1,053,681

 

471

0.04

%

 

6,990

0.66

%

Home equity and improvement

 

271,676

 

266,931

 

2,404

0.88

%

 

2,341

0.86

%

Consumer finance

 

212,299

 

206,247

 

3,511

1.65

%

 

2,541

1.20

%

Gross loans

$

7,168,836

$

7,123,327

$

11,132

0.16

%

$

34,377

0.48

%

 
December 31, 2022
One to four family residential real estate

$

1,535,574

$

1,520,074

$

6,792

0.44

%

$

8,708

0.57

%

Construction

 

1,278,255

 

1,277,818

 

437

0.03

%

 

-

0.00

%

Commercial real estate

 

2,762,311

 

2,747,539

 

1,205

0.04

%

 

13,567

0.49

%

Commercial

 

1,055,180

 

1,047,829

 

497

0.05

%

 

6,854

0.65

%

Home equity and improvement

 

277,613

 

270,138

 

5,216

1.88

%

 

2,259

0.81

%

Consumer finance

 

213,405

 

206,779

 

4,192

1.96

%

 

2,434

1.14

%

Gross loans

$

7,122,338

$

7,070,177

$

18,339

0.26

%

$

33,822

0.47

%

 
March 31, 2022
One to four family residential real estate

$

1,222,057

$

1,206,560

$

3,843

0.31

%

$

11,654

0.95

%

Construction

 

883,712

 

883,712

 

-

0.00

%

 

-

0.00

%

Commercial real estate

 

2,495,469

 

2,480,656

 

181

0.01

%

 

14,632

0.59

%

Commercial

 

910,553

 

894,923

 

18

0.00

%

 

15,612

1.71

%

Home equity and improvement

 

132,294

 

127,856

 

2,214

1.67

%

 

2,224

1.68

%

Consumer finance

 

261,176

 

256,667

 

1,333

0.51

%

 

3,176

1.22

%

Gross loans

$

5,905,261

$

5,850,374

$

7,589

0.13

%

$

47,298

0.80

%

 
Loan Risk Ratings Information
(dollars in thousands) Total Balance Pass Rated Special Mention % of Total Classified % of Total
 
March 31, 2023
One to four family residential real estate

$

1,612,999

$

1,604,694

$

493

0.03

%

$

7,812

0.48

%

Construction

 

1,185,947

 

1,185,947

 

-

0.00

%

 

-

0.00

%

Commercial real estate

 

2,811,999

 

2,748,598

 

41,677

1.48

%

 

21,724

0.77

%

Commercial

 

1,055,829

 

1,015,416

 

33,090

3.13

%

 

7,323

0.69

%

Home equity and improvement

 

269,455

 

267,588

 

-

0.00

%

 

1,867

0.69

%

Consumer finance

 

212,043

 

209,566

 

-

0.00

%

 

2,477

1.17

%

PCD loans

 

20,564

 

13,177

 

3,683

17.91

%

 

3,704

18.01

%

Gross loans

$

7,168,836

$

7,044,986

$

78,943

1.10

%

$

44,907

0.63

%

 
December 31, 2022
One to four family residential real estate

$

1,524,029

$

1,514,719

$

935

0.06

%

$

8,375

0.55

%

Construction

 

1,278,255

 

1,278,255

 

-

0.00

%

 

-

0.00

%

Commercial real estate

 

2,760,766

 

2,694,443

 

46,029

1.67

%

 

20,294

0.74

%

Commercial

 

1,050,122

 

1,016,973

 

26,319

2.51

%

 

6,830

0.65

%

Home equity and improvement

 

275,204

 

273,613

 

-

0.00

%

 

1,591

0.58

%

Consumer finance

 

213,131

 

210,760

 

-

0.00

%

 

2,371

1.11

%

PCD loans

 

20,831

 

13,904

 

2,590

12.43

%

 

4,337

20.82

%

Gross loans

$

7,122,338

$

7,002,667

$

75,873

1.07

%

$

43,798

0.61

%

 
March 31, 2022
One to four family residential real estate

$

1,209,537

$

1,198,311

$

1,295

0.11

%

$

9,931

0.82

%

Construction

 

883,712

 

883,712

 

-

0.00

%

 

-

0.00

%

Commercial real estate

 

2,492,324

 

2,373,111

 

93,550

3.75

%

 

25,663

1.03

%

Commercial

 

901,957

 

869,615

 

20,558

2.28

%

 

11,784

1.31

%

Consumer finance

 

131,846

 

129,747

 

-

0.00

%

 

2,099

1.59

%

Home equity and improvement

 

258,041

 

255,883

 

-

0.00

%

 

2,158

0.84

%

PCD loans

 

27,844

 

19,110

 

98

0.35

%

 

8,636

31.02

%

Total loans

$

5,905,261

$

5,729,489

$

115,501

1.96

%

$

60,271

1.02

%

Premier Financial Corp.
Mortgage and Credit Information
(dollars in thousands)
As of and for the Three Months Ended
Mortgage Banking Summary 3/31/23 12/31/22 9/30/22 6/30/22 3/31/22
Revenue from sales and servicing of mortgage loans:
Mortgage banking gains, net

$

(837

)

$

(1,285

)

$

3,363

 

$

1,166

 

$

2,543

 

Mortgage loan servicing revenue (expense):
Mortgage loan servicing revenue

 

1,888

 

 

1,862

 

 

1,861

 

 

1,862

 

 

1,879

 

Amortization of mortgage servicing rights

 

(1,219

)

 

(1,271

)

 

(1,350

)

 

(1,375

)

 

(1,403

)

Mortgage servicing rights valuation adjustments

 

(106

)

 

396

 

 

96

 

 

295

 

 

1,233

 

 

563

 

 

987

 

 

607

 

 

782

 

 

1,709

 

Total revenue from sale/servicing of mortgage loans

$

(274

)

$

(298

)

$

3,970

 

$

1,948

 

$

4,252

 

 
Mortgage servicing rights:
Balance at beginning of period

$

21,858

 

$

21,915

 

$

21,872

 

$

22,189

 

$

22,244

 

Loans sold, servicing retained

 

808

 

 

1,214

 

 

1,393

 

 

1,058

 

 

1,348

 

Mortgage servicing rights acquired

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Amortization

 

(1,219

)

 

(1,271

)

 

(1,350

)

 

(1,375

)

 

(1,403

)

Balance at end of period

 

21,447

 

 

21,858

 

 

21,915

 

 

21,872

 

 

22,189

 

Valuation allowance:
Balance at beginning of period

 

(687

)

 

(1,083

)

 

(1,179

)

 

(1,474

)

 

(2,707

)

Impairment recovery (charges)

 

(106

)

 

396

 

 

96

 

 

295

 

 

1,233

 

Balance at end of period

 

(793

)

 

(687

)

 

(1,083

)

 

(1,179

)

 

(1,474

)

Net carrying value at end of period

$

20,654

 

$

21,171

 

$

20,832

 

$

20,693

 

$

20,715

 

 
 
Allowance for credit losses - loans
Beginning allowance

$

72,816

 

$

70,626

 

$

67,074

 

$

67,195

 

$

66,468

 

Provision (benefit) for credit losses - loans

 

3,944

 

 

3,020

 

 

3,706

 

 

5,151

 

 

626

 

Net recoveries (charge-offs)

 

(2,487

)

 

(830

)

 

(154

)

 

(5,272

)

 

101

 

Ending allowance

$

74,273

 

$

72,816

 

$

70,626

 

$

67,074

 

$

67,195

 

 
Total loans

$

6,575,829

 

$

6,460,620

 

$

6,207,708

 

$

5,890,823

 

$

5,388,331

 

Less: PPP loans

 

(791

)

 

(1,143

)

 

(1,181

)

 

(4,561

)

 

(18,660

)

Total loans ex PPP

$

6,575,038

 

$

6,459,477

 

$

6,206,527

 

$

5,886,262

 

$

5,369,671

 

 
Allowance for credit losses (ACL)

$

74,273

 

$

72,816

 

$

70,626

 

$

67,074

 

$

67,195

 

Add: Unaccreted purchase accounting marks

 

2,301

 

 

2,706

 

 

3,291

 

 

3,924

 

 

4,652

 

Adjusted ACL

$

76,574

 

$

75,522

 

$

73,917

 

$

70,998

 

$

71,847

 

ACL/Loans

 

1.13

%

 

1.13

%

 

1.14

%

 

1.14

%

 

1.25

%

Adjusted ACL/Loans ex PPP

 

1.16

%

 

1.17

%

 

1.19

%

 

1.21

%

 

1.34

%

 
Credit Quality
Total non-performing loans (1)

$

34,377

 

$

33,822

 

$

33,137

 

$

34,735

 

$

47,298

 

Real estate owned (REO)

 

393

 

 

619

 

 

416

 

 

462

 

 

253

 

Total non-performing assets (2)

$

34,770

 

$

34,441

 

$

33,553

 

$

35,197

 

$

47,551

 

Net charge-offs (recoveries)

 

2,487

 

 

830

 

 

154

 

 

5,272

 

 

(101

)

 
Allowance for credit losses - loans / non-performing assets

 

213.61

%

 

211.42

%

 

210.49

%

 

190.57

%

 

141.31

%

Allowance for credit losses - loans / non-performing loans

 

216.05

%

 

215.29

%

 

213.13

%

 

193.10

%

 

142.07

%

Non-performing assets / loans plus REO

 

0.53

%

 

0.53

%

 

0.54

%

 

0.60

%

 

0.88

%

Non-performing assets / total assets

 

0.41

%

 

0.41

%

 

0.41

%

 

0.44

%

 

0.63

%

Net charge-offs / average loans (annualized)

 

0.15

%

 

0.05

%

 

0.01

%

 

0.37

%

 

-0.01

%

Net charge-offs / average loans LTM

 

0.14

%

 

0.10

%

 

0.26

%

 

0.27

%

 

0.17

%

 
(1) Non-performing loans consist of non-accrual loans.
(2) Non-performing assets are non-performing loans plus real estate and other assets acquired by foreclosure or deed-in-lieu thereof.

 

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