Byline Bancorp, Inc. Reports Second Quarter 2019 Financial Results

Second Quarter 2019 Highlights

  • Completed the acquisition of Oak Park River Forest Bankshares, Inc. on April 30, 2019, increasing our total assets to $5.4 billion at June 30, 2019
  • Net income of $13.2 million, or $0.34 per diluted share
    • Adjusted net income1 of $15.9 million, or $0.41 per adjusted diluted share
  • Net interest margin improves to 4.51% for the second quarter of 2019, compared to 4.43% for both the first quarter of 2019 and second quarter of 2018
  • Originated loans and leases grew to $2.6 billion at June 30, 2019, an increase of $96.8 million, or 3.9%, from March 31, 2019
  • Efficiency ratio of 61.19% for the second quarter of 2019, compared to 62.68% for the first quarter of 2019, and 83.26% for the second quarter of 2018
    • Adjusted efficiency ratio1 of 56.02% for the second quarter of 2019, compared to 59.55% for the first quarter of 2019, and 63.28% for the second quarter of 2018
  • Return on average assets of 1.00% for the second quarter of 2019, compared to 1.03% for the first quarter of 2019, and 0.29% for the second quarter of 2018
  • Return on average stockholders’ equity of 7.60% for the second quarter of 2019, compared to 7.75% for the first quarter of 2019, and 2.14% for the second quarter of 2018

CHICAGO--()--Byline Bancorp, Inc. (the “Company” or “Byline”)(NYSE: BY), the parent company of Byline Bank (the “Bank”), today reported net income of $13.2 million, or $0.34 per diluted share, for the second quarter of 2019, compared with net income of $12.6 million, or $0.34 per diluted share, for the first quarter of 2019, and net income of $2.8 million, or $0.08 per diluted share, for the second quarter of 2018. The Company’s financial results include certain costs associated with its integration of First Evanston Bancorp, Inc. and its bank subsidiary First Bank & Trust, and its acquisition of Oak Park River Forest Bankshares, Inc. (“Oak Park River Forest”) and its bank subsidiary Community Bank of Oak Park River Forest. Excluding these merger-related expenses, core system conversion expenses, and impairment charges on assets held for sale, adjusted net income1 was $15.9 million, or $0.41 per adjusted diluted share, for the second quarter of 2019, compared with $14.0 million, or $0.38 per adjusted diluted share, for the first quarter of 2019, and $10.6 million, or $0.32 per adjusted diluted share, for the second quarter of 2018. A reconciliation of adjusted net income and adjusted diluted earnings per share to net income and diluted earnings per share, respectively, according to accounting principles generally accepted in the United States of America (“GAAP”) is provided in the financial tables at the end of this release.

Alberto J. Paracchini, President and Chief Executive Officer of Byline, commented, “We are pleased to report another quarter of solid results, characterized by a successful acquisition, a strong net interest margin, improved operating performance, and organic growth. Thanks to the efforts of our bankers and team members, we continued to experience healthy growth in loans and deposits. This quarter we also welcomed the customers and employees of Oak Park River Forest Bankshares, Inc. to Byline. This transaction further enhances our position in the Chicago Metropolitan market and provides us with solid opportunities for growth. Ensuring a smooth transition for customers and colleagues is a top priority for the remainder of 2019,” said Mr. Paracchini.

(1)

Represents a non-GAAP financial measure. See “Reconciliation of non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

STATEMENTS OF OPERATIONS

Net Interest Income

The following table presents net interest income for the periods indicated:

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

June 30,

 

June 30,

(dollars in thousands)

2019

 

2019

 

2018

 

2018

 

2018

 

2019

 

2018

INTEREST AND DIVIDEND INCOME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans and

leases

$

59,524

$

54,383

$

56,646

$

55,045

$

39,627

$

113,907

$

73,281

Interest on taxable securities

 

6,237

 

5,759

 

5,334

 

5,076

 

4,572

 

11,996

 

8,627

Interest on tax-exempt securities

 

428

 

343

 

355

 

337

 

229

 

771

 

403

Other interest and dividend

income

 

571

 

625

 

560

 

615

 

413

 

1,196

 

672

Total interest and dividend

income

 

66,760

 

61,110

 

62,895

 

61,073

 

44,841

 

127,870

 

82,983

INTEREST EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

9,306

 

8,076

 

7,115

 

5,971

 

3,745

 

17,382

 

6,243

Federal Home Loan Bank

advances

 

2,174

 

2,099

 

1,719

 

1,723

 

1,360

 

4,273

 

2,718

Subordinated debentures and

other borrowings

 

832

 

850

 

800

 

786

 

680

 

1,682

 

1,271

Total interest expense

 

12,312

 

11,025

 

9,634

 

8,480

 

5,785

 

23,337

 

10,232

Net interest income

$

54,448

$

50,085

$

53,261

$

52,593

$

39,056

$

104,533

$

72,751

 

The following table presents the quarter-to-date schedule of average interest-earning assets and average interest-bearing liabilities for the periods indicated:

 

 

For the Three Months Ended

 

 

June 30, 2019

 

March 31, 2019

(dollars in thousands)

 

Average

Balance(5)

 

 

Interest

Inc / Exp

 

 

Average

Yield /

Rate

 

Average

Balance(5)

 

 

Interest

Inc / Exp

 

 

Average

Yield /

Rate

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

35,346

 

 

$

245

 

 

 

2.78

%

 

$

66,765

 

 

$

301

 

 

 

1.83

%

Loans and leases(1)

 

 

3,759,634

 

 

 

59,524

 

 

 

6.35

%

 

 

3,533,973

 

 

 

54,383

 

 

 

6.24

%

Taxable securities

 

 

975,693

 

 

 

6,563

 

 

 

2.70

%

 

 

926,129

 

 

 

6,083

 

 

 

2.66

%

Tax-exempt securities(2)

 

 

68,314

 

 

 

428

 

 

 

2.52

%

 

 

55,198

 

 

 

343

 

 

 

2.52

%

Total interest-earning assets

 

$

4,838,987

 

 

$

66,760

 

 

 

5.53

%

 

$

4,582,065

 

 

$

61,110

 

 

 

5.41

%

Allowance for loan and lease losses

 

 

(28,203

)

 

 

 

 

 

 

 

 

 

(25,354

)

 

 

 

 

 

 

 

All other assets

 

 

464,036

 

 

 

 

 

 

 

 

 

 

406,995

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

5,274,820

 

 

 

 

 

 

 

 

 

$

4,963,706

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’

EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest checking

 

$

333,725

 

 

$

452

 

 

 

0.54

%

 

$

293,049

 

 

$

413

 

 

 

0.57

%

Money market accounts

 

 

695,986

 

 

 

1,790

 

 

 

1.03

%

 

 

613,001

 

 

 

1,460

 

 

 

0.97

%

Savings

 

 

477,775

 

 

 

118

 

 

 

0.10

%

 

 

471,206

 

 

 

138

 

 

 

0.12

%

Time deposits

 

 

1,278,488

 

 

 

6,946

 

 

 

2.18

%

 

 

1,195,417

 

 

 

6,065

 

 

 

2.06

%

Total interest-bearing

deposits

 

 

2,785,974

 

 

 

9,306

 

 

 

1.34

%

 

 

2,572,673

 

 

 

8,076

 

 

 

1.27

%

Federal Home Loan Bank advances

 

 

426,446

 

 

 

2,174

 

 

 

2.04

%

 

 

433,372

 

 

 

2,099

 

 

 

1.96

%

Other borrowed funds

 

 

73,358

 

 

 

832

 

 

 

4.55

%

 

 

71,280

 

 

 

850

 

 

 

4.84

%

Total borrowings

 

 

499,804

 

 

 

3,006

 

 

 

2.41

%

 

 

504,652

 

 

 

2,949

 

 

 

2.37

%

Total interest-bearing liabilities

 

$

3,285,778

 

 

$

12,312

 

 

 

1.50

%

 

$

3,077,325

 

 

$

11,025

 

 

 

1.45

%

Non-interest-bearing demand deposits

 

 

1,254,173

 

 

 

 

 

 

 

 

 

 

1,185,981

 

 

 

 

 

 

 

 

Other liabilities

 

 

37,941

 

 

 

 

 

 

 

 

 

 

41,244

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

 

696,928

 

 

 

 

 

 

 

 

 

 

659,156

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

5,274,820

 

 

 

 

 

 

 

 

 

$

4,963,706

 

 

 

 

 

 

 

 

Net interest spread(3)

 

 

 

 

 

 

 

 

 

 

4.03

%

 

 

 

 

 

 

 

 

 

 

3.96

%

Net interest income

 

 

 

 

 

$

54,448

 

 

 

 

 

 

 

 

 

$

50,085

 

 

 

 

Net interest margin(4)

 

 

 

 

 

 

 

 

 

 

4.51

%

 

 

 

 

 

 

 

 

 

 

4.43

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loan accretion impact on margin

 

 

 

 

 

$

4,868

 

 

 

0.40

%

 

 

 

 

 

$

5,201

 

 

 

0.46

%

(1)

Loan and lease balances are net of deferred origination fees and costs and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances.

(2)

Interest income and rates exclude the effects of a tax equivalent adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality.

(3)

Represents the average rate earned on interest-earning assets minus the average rate paid on interest-bearing liabilities.

(4)

Represents net interest income (annualized) divided by total average earning assets.

(5)

Average balances are average daily balances.

The Company completed its acquisition of Oak Park River Forest in the second quarter of 2019. All references to this transaction in the following narrative are referred to as “the acquisition” or “our recent acquisition.” The total estimated fair value of assets acquired was approximately $323.9 million, including loans with an estimated fair value of $261.2 million and securities available-for-sale of $30.3 million. The estimated fair value of liabilities assumed was approximately $305.9 million, including deposits with an estimated fair value of $290.2 million.

Net interest income for the second quarter of 2019 was $54.4 million, an increase of $4.4 million, or 8.7%, from $50.1 million for the first quarter of 2019.

The increase in net interest income was primarily due to:

  • An increase of $5.1 million in interest and fees on loans and leases, primarily due to loans added from the acquisition and growth in organic loan and lease originations; and
  • An increase of $563,000 in interest income on securities, primarily due to additional purchases and securities acquired during the quarter.

Partially offset by:

  • An increase of $1.2 million in interest expense on deposits, primarily due to deposits assumed as a result of the acquisition and an increase in average rates on time deposits and money market accounts.

Net interest margin for the second quarter of 2019 was 4.51%, an increase of eight basis points compared to 4.43% for the first quarter of 2019. Total net accretion income on acquired loans contributed 40 basis points to the net interest margin for the second quarter of 2019 compared to 46 basis points for the first quarter of 2019, a decrease of six basis points. The net interest margin increase was primarily driven by increased loan and lease yields resulting from the acquisition and higher U.S. government guaranteed loan originations during the quarter.

The average cost of total deposits was 0.92% for the second quarter of 2019, an increase of five basis points compared to the first quarter of 2019, primarily due to increased rates on interest-bearing deposits partially offset by increased average non-interest-bearing demand deposits. Additionally, there was growth in average time deposits of $83.1 million, average money market accounts of $83.0 million, average non-interest-bearing demand deposits of $68.2 million, average interest checking of $40.7 million, and average savings of $6.6 million, primarily attributed to the acquisition. We believe the acquisition provides a strong core deposit base, which helped offset the slightly higher deposit costs in the quarter.

Provision for Loan and Lease Losses

The provision for loan and lease losses was $6.4 million for the second quarter of 2019, an increase of $2.4 million compared to $4.0 million for the first quarter of 2019. The second quarter provision included allocations of $3.3 million for originated loans and leases, $2.5 million for acquired non-impaired loans, and $525,000 for acquired impaired loans. The increased provision during the second quarter of 2019 was primarily due to additional specific impairments on the unguaranteed balance of the U.S. government guaranteed portfolio and increases in the general reserves driven by newly originated loans and renewals of acquired non-impaired loans that have migrated to the originated loan portfolio.

Non-interest Income

The following table presents the components of non-interest income for the periods indicated:

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

June 30,

 

June 30,

 

(dollars in thousands)

2019

 

2019

 

2018

 

2018

 

2018

 

2019

 

2018

 

NON-INTEREST INCOME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fees and service charges on

deposits

$

1,441

 

$

1,770

 

$

1,852

 

$

1,825

 

$

1,456

 

$

3,211

 

$

2,768

 

Loan servicing revenue

 

2,630

 

 

2,539

 

 

2,667

 

 

2,622

 

 

2,533

 

 

5,169

 

 

4,983

 

Loan servicing asset revaluation

 

(1,223

)

 

(1,261

)

 

(2,862

)

 

(2,446

)

 

(2,074

)

 

(2,484

)

 

(3,961

)

ATM and interchange fees

 

945

 

 

717

 

 

1,010

 

 

1,540

 

 

850

 

 

1,662

 

 

1,763

 

Net gains on sales of securities

available-for-sale

 

973

 

 

 

 

160

 

 

 

 

4

 

 

973

 

 

4

 

Change in fair value of equity

securities, net

 

551

 

 

499

 

 

 

 

 

 

 

 

1,050

 

 

 

Net gains on sales of loans

 

7,472

 

 

6,233

 

 

9,337

 

 

5,015

 

 

9,723

 

 

13,705

 

 

17,199

 

Wealth management and trust

income

 

626

 

 

595

 

 

679

 

 

674

 

 

192

 

 

1,221

 

 

192

 

Other non-interest income

 

768

 

 

896

 

 

1,447

 

 

1,672

 

 

1,527

 

 

1,664

 

 

2,386

 

Total non-interest income

$

14,183

 

$

11,988

 

$

14,290

 

$

10,902

 

$

14,211

 

$

26,171

 

$

25,334

 

Non-interest income for the second quarter of 2019 was $14.2 million, an increase of $2.2 million, or 18.3%, compared to $12.0 million for the first quarter of 2019.

The increase in total non-interest income was primarily due to:

  • An increase of $1.2 million in net gains on sales of loans, primarily due to an increase in government guaranteed loan sales and average premiums;
  • Net gains on sales of securities available-for-sale of $973,000 due to sales of agency and non-agency mortgage-backed, agency, municipal, and treasury securities during the quarter; and
  • An increase of $228,000 in ATM and interchange fees, primarily due to increased transactional account volume during the quarter.

Partially offset by:

  • A decrease of $329,000 in fees and service charges on deposits, primarily due to lower fee income from business and consumer accounts.

During the second quarter of 2019, the Company sold $75.2 million of U.S. government guaranteed loans compared to $66.2 million during the first quarter of 2019, contributing to the increase in net gains on sale of loans for the quarter. The increase in sales is primarily due to an increase in the volume of loans closed in the second quarter and the timing of loans closed becoming fully funded. The second quarter of 2019 included sales of $10.4 million of USDA loans while the first quarter of 2019 included sales of $479,000.

Non-interest Expense

The following table presents the components of non-interest expense for the periods indicated:

 

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

June 30,

 

 

June 30,

 

 

June 30,

(dollars in thousands)

 

2019

 

 

2019

 

 

2018

 

 

2018

 

 

2018

 

 

2019

 

 

2018

NON-INTEREST EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

$

23,652

 

 

$

22,892

 

 

$

21,548

 

 

$

21,312

 

 

$

19,244

 

 

$

46,544

 

 

$

37,522

Occupancy expense, net

 

 

4,337

 

 

 

4,280

 

 

 

4,027

 

 

 

3,548

 

 

 

4,499

 

 

 

8,617

 

 

 

8,254

Equipment expense

 

 

732

 

 

 

669

 

 

 

641

 

 

 

617

 

 

 

558

 

 

 

1,401

 

 

 

1,161

Loan and lease related expenses

 

 

1,841

 

 

 

1,577

 

 

 

2,223

 

 

 

1,015

 

 

 

1,471

 

 

 

3,418

 

 

 

2,871

Legal, audit and other professional

fees

 

 

2,981

 

 

 

2,066

 

 

 

2,746

 

 

 

2,358

 

 

 

4,418

 

 

 

5,047

 

 

 

6,269

Data processing

 

 

3,849

 

 

 

3,144

 

 

 

2,846

 

 

 

2,724

 

 

 

10,371

 

 

 

6,993

 

 

 

12,672

Net loss (gain) recognized on other

real estate owned and other

related expenses

 

 

252

 

 

 

196

 

 

 

48

 

 

 

(284

)

 

 

472

 

 

 

448

 

 

 

471

Regulatory assessments

 

 

371

 

 

 

(59

)

 

 

462

 

 

 

675

 

 

 

366

 

 

 

312

 

 

 

607

Other intangible assets

amortization expense

 

 

1,959

 

 

 

1,773

 

 

 

1,834

 

 

 

1,898

 

 

 

1,130

 

 

 

3,732

 

 

 

1,897

Advertising and promotions

 

 

732

 

 

 

709

 

 

 

590

 

 

 

537

 

 

 

347

 

 

 

1,441

 

 

 

596

Telecommunications

 

 

537

 

 

 

464

 

 

 

391

 

 

 

435

 

 

 

466

 

 

 

1,001

 

 

 

884

Other non-interest expense

 

 

2,711

 

 

 

2,968

 

 

 

2,732

 

 

 

2,880

 

 

 

2,137

 

 

 

5,679

 

 

 

3,889

Total non-interest expense

 

$

43,954

 

 

$

40,679

 

 

$

40,088

 

 

$

37,715

 

 

$

45,479

 

 

$

84,633

 

 

$

77,093

Non-interest expense for the second quarter of 2019 was $44.0 million, an increase of $3.3 million, or 8.1%, from $40.7 million for the first quarter of 2019.

The increase in total non-interest expense was primarily due to:

  • An increase of $915,000 in legal, audit and other professional fees, primarily due to professional services incurred related to the acquisition and our core system conversion;
  • An increase of $760,000 in salaries and employee benefits, primarily due to additional salary and employee benefit expenses subsequent to the acquisition closing, partially offset by a decrease in payroll taxes;
  • An increase of $705,000 in data processing expense, primarily due to acquisition related and core system conversion expenses;
  • An increase of $430,000 in regulatory assessments, primarily due to an FDIC credit in the first quarter; and
  • An increase of $264,000 in loan and lease related expenses, primarily due to broker fee expenses associated with U.S. government guaranteed loan sales as a result of increased loan sales during the quarter.

Partially offset by:

  • A decrease of $257,000 in other non-interest expense, primarily due to reduced asset impairment costs partially offset by an increased provision for unfunded commitments.

The Company’s efficiency ratio was 61.19% for the second quarter of 2019, compared with 62.68% for the first quarter of 2019. Excluding merger-related expenses, core system conversion expenses, and impairment charges on assets held for sale, the Company’s adjusted efficiency ratio1 was 56.02% for the second quarter of 2019, compared with 59.55% for the first quarter of 2019.

(1)

Represents a non-GAAP financial measure. See “Reconciliation of non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

INCOME TAXES

The Company recorded income tax expense of $5.1 million during the second quarter of 2019, an effective tax rate of 27.8%, compared to $4.8 million during the first quarter of 2019, an effective tax rate of 27.6%.

STATEMENTS OF FINANCIAL CONDITION

Total assets were $5.4 billion at June 30, 2019, an increase of $381.3 million compared to $5.0 billion at March 31, 2019, and an increase of $586.0 million compared to $4.8 billion at June 30, 2018.

The current quarter increase was primarily due to:

  • An increase in loans and leases of $295.6 million, primarily due to an increase of $198.8 million in our acquired loan portfolio largely from the acquisition and an increase of $96.8 million in our originated loan portfolio;
  • An increase in loans held for sale of $18.0 million, primarily due to the timing of loan sales at June 30, 2019;
  • An increase in goodwill of $17.5 million due to the premium value associated with the acquisition; and
  • An increase in due from counterparty of $13.5 million due to the timing of the settlement of loans sold at June 30, 2019.

The following table shows our allocation of the originated, acquired impaired and acquired non-impaired loans and leases at the dates indicated:

 

 

June 30, 2019

 

March 31, 2019

 

June 30, 2018

(dollars in thousands)

 

Amount

 

% of Total

 

Amount

 

% of Total

 

Amount

 

% of Total

Originated loans and leases

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate

 

$

721,230

 

 

 

18.7

%

 

$

738,832

 

 

 

20.7

%

 

$

539,529

 

 

 

16.1

%

Residential real estate

 

 

501,038

 

 

 

13.0

%

 

 

494,877

 

 

 

13.9

%

 

 

413,956

 

 

 

12.4

%

Construction, land development, and

other land

 

 

196,656

 

 

 

5.1

%

 

 

181,427

 

 

 

5.1

%

 

 

134,004

 

 

 

4.0

%

Commercial and industrial

 

 

992,313

 

 

 

25.7

%

 

 

900,709

 

 

 

25.2

%

 

 

556,340

 

 

 

16.6

%

Installment and other

 

 

10,937

 

 

 

0.3

%

 

 

11,082

 

 

 

0.3

%

 

 

4,898

 

 

 

0.1

%

Leasing financing receivables

 

 

162,119

 

 

 

4.1

%

 

 

160,607

 

 

 

4.5

%

 

 

156,017

 

 

 

4.7

%

Total originated loans and leases

 

$

2,584,293

 

 

 

66.9

%

 

$

2,487,534

 

 

 

69.7

%

 

$

1,804,744

 

 

 

53.9

%

Acquired impaired loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate

 

$

151,127

 

 

 

3.9

%

 

$

141,199

 

 

 

4.0

%

 

$

162,621

 

 

 

4.9

%

Residential real estate

 

 

118,534

 

 

 

3.1

%

 

 

106,764

 

 

 

3.0

%

 

 

129,737

 

 

 

3.9

%

Construction, land development, and

other land

 

 

4,220

 

 

 

0.1

%

 

 

3,111

 

 

 

0.1

%

 

 

4,860

 

 

 

0.1

%

Commercial and industrial

 

 

20,370

 

 

 

0.5

%

 

 

11,963

 

 

 

0.3

%

 

 

15,347

 

 

 

0.4

%

Installment and other

 

 

300

 

 

 

0.0

%

 

 

374

 

 

 

0.0

%

 

 

521

 

 

 

0.0

%

Total acquired impaired loans

 

$

294,551

 

 

 

7.6

%

 

$

263,411

 

 

 

7.4

%

 

$

313,086

 

 

 

9.3

%

Acquired non-impaired loans and leases

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate

 

$

439,182

 

 

 

11.4

%

 

$

382,252

 

 

 

10.7

%

 

$

532,837

 

 

 

15.9

%

Residential real estate

 

 

158,190

 

 

 

4.1

%

 

 

97,395

 

 

 

2.8

%

 

 

155,895

 

 

 

4.7

%

Construction, land development, and

other land

 

 

51,072

 

 

 

1.3

%

 

 

29,121

 

 

 

0.8

%

 

 

49,752

 

 

 

1.5

%

Commercial and industrial

 

 

307,887

 

 

 

8.0

%

 

 

277,146

 

 

 

7.8

%

 

 

454,133

 

 

 

13.6

%

Installment and other

 

 

1,672

 

 

 

0.0

%

 

 

1,346

 

 

 

0.0

%

 

 

7,387

 

 

 

0.2

%

Leasing financing receivables

 

 

26,301

 

 

 

0.7

%

 

 

29,361

 

 

 

0.8

%

 

 

30,858

 

 

 

0.9

%

Total acquired non-impaired loans

and leases

 

$

984,304

 

 

 

25.5

%

 

$

816,621

 

 

 

22.9

%

 

$

1,230,862

 

 

 

36.8

%

Total loans and leases

 

$

3,863,148

 

 

 

100.0

%

 

$

3,567,566

 

 

 

100.0

%

 

$

3,348,692

 

 

 

100.0

%

Allowance for loan and lease losses

 

 

(31,132

)

 

 

 

 

 

(27,106

)

 

 

 

 

 

(19,687

)

 

 

 

Total loans and leases, net of allowance for

loan and lease losses

 

$

3,832,016

 

 

 

 

 

$

3,540,460

 

 

 

 

 

$

3,329,005

 

 

 

 

ASSET QUALITY

Non-Performing Assets

The following table sets forth the amounts of non-performing loans and leases, non-performing assets, and other real estate owned at the dates indicated:

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

June 30,

 

(dollars in thousands)

 

2019

 

 

2019

 

 

2018

 

 

2018

 

 

2018

 

Non-performing assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-accrual loans and leases

 

$

34,027

 

 

$

28,539

 

 

$

25,834

 

 

$

28,643

 

 

$

25,742

 

Past due loans and leases 90 days or more and still accruing interest

 

 

996

 

 

 

 

 

 

 

 

 

291

 

 

 

197

 

Accruing troubled debt restructured loans

 

 

1,529

 

 

 

1,921

 

 

 

1,813

 

 

 

1,230

 

 

 

1,238

 

Total non-performing loans and leases

 

 

36,552

 

 

 

30,460

 

 

 

27,647

 

 

 

30,164

 

 

 

27,177

 

Other real estate owned

 

 

8,070

 

 

 

4,799

 

 

 

5,314

 

 

 

4,891

 

 

 

6,402

 

Total non-performing assets

 

$

44,622

 

 

$

35,259

 

 

$

32,961

 

 

$

35,055

 

 

$

33,579

 

Total non-performing loans and leases as a percentage of total loans and leases

 

 

0.95

%

 

 

0.85

%

 

 

0.79

%

 

 

0.87

%

 

 

0.81

%

Total non-performing assets as a percentage of total assets

 

 

0.83

%

 

 

0.70

%

 

 

0.67

%

 

 

0.71

%

 

 

0.70

%

Allowance for loan and lease losses as a percentage of non-performing loans and leases

 

 

85.17

%

 

 

88.99

%

 

 

91.15

%

 

 

77.65

%

 

 

72.44

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing assets guaranteed by U.S. government:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-accrual loans guaranteed

 

$

4,723

 

 

$

5,070

 

 

$

4,245

 

 

$

6,830

 

 

$

6,810

 

Past due loans 90 days or more and still accruing interest guaranteed

 

 

 

 

 

 

 

 

 

 

 

 

 

 

152

 

Accruing troubled debt restructured loans guaranteed

 

 

 

 

 

 

 

 

381

 

 

 

431

 

 

 

 

Total non-performing loans guaranteed

 

 

4,723

 

 

 

5,070

 

 

 

4,626

 

 

 

7,261

 

 

 

6,962

 

Other real estate owned guaranteed

 

 

1,539

 

 

 

 

 

 

 

 

 

 

 

 

298

 

Total non-performing assets guaranteed

 

$

6,262

 

 

$

5,070

 

 

$

4,626

 

 

$

7,261

 

 

$

7,260

 

Total non-performing loans and leases not guaranteed as a percentage of total loans and leases

 

 

0.82

%

 

 

0.71

%

 

 

0.66

%

 

 

0.66

%

 

 

0.60

%

Total non-performing assets not guaranteed as a percentage of total assets

 

 

0.71

%

 

 

0.60

%

 

 

0.57

%

 

 

0.57

%

 

 

0.55

%

Variances in non-performing assets:

  • Non-performing loans and leases were $36.6 million at June 30, 2019, an increase of $6.1 million from $30.5 million at March 31, 2019, primarily due to defaults in the U.S. government guaranteed portfolio; and
  • Other real estate owned was $8.1 million at June 30, 2019, an increase of $3.3 million from $4.8 million at March 31, 2019, due to properties added from the U.S. government guaranteed portfolio and properties added as a result of the acquisition during the second quarter of 2019. The government guaranteed portion of other real estate owned was $1.5 million at June 30, 2019.

Non-performing assets included $6.3 million of U.S. government guaranteed balances at June 30, 2019 and $5.1 million at March 31, 2019, an increase of $1.2 million, primarily due to defaults in the U.S. government guaranteed portfolio.

Allowance for Loan and Lease Losses

The following table presents the balance and activity within the allowance for loan and lease losses for the periods indicated:

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

June 30,

 

 

June 30,

 

 

June 30,

 

(dollars in thousands)

 

2019

 

 

2019

 

 

2018

 

 

2018

 

 

2018

 

 

2019

 

 

2018

 

Allowance for loan and lease losses,

beginning of period

 

$

27,106

 

 

$

25,201

 

 

$

23,424

 

 

$

19,687

 

 

$

17,640

 

 

$

25,201

 

 

$

16,706

 

Provision for loan and lease losses

 

 

6,391

 

 

 

3,999

 

 

 

3,882

 

 

 

5,842

 

 

 

3,956

 

 

 

10,390

 

 

 

9,071

 

Net charge-offs of loans and leases

 

 

(2,365

)

 

 

(2,094

)

 

 

(2,105

)

 

 

(2,105

)

 

 

(1,909

)

 

 

(4,459

)

 

 

(6,090

)

Allowance for loan and lease losses,

end of period

 

$

31,132

 

 

$

27,106

 

 

$

25,201

 

 

$

23,424

 

 

$

19,687

 

 

$

31,132

 

 

$

19,687

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan and lease losses

to period end total loans and

leases held for investment

 

 

0.81

%

 

 

0.76

%

 

 

0.72

%

 

 

0.68

%

 

 

0.59

%

 

 

0.81

%

 

 

0.59

%

Net charge-offs (annualized) to

average loans and leases

outstanding during the period

 

 

0.25

%

 

 

0.24

%

 

 

0.24

%

 

 

0.25

%

 

 

0.29

%

 

 

0.25

%

 

 

0.50

%

Provision for loan and lease losses to

net charge-offs during the period

 

2.70x

 

 

1.91x

 

 

1.84x

 

 

2.77x

 

 

2.07x

 

 

2.33x

 

 

1.49x

 

The allowance for loan and lease losses as a percentage of total loans and leases held for investment increased to 0.81% at June 30, 2019, from 0.76% at March 31, 2019 and 0.59% at June 30, 2018.

Net Charge-Offs

Net charge-offs during the second quarter of 2019 were $2.4 million, or 0.25% of average loans and leases, on an annualized basis, an increase of $271,000 compared to $2.1 million, or 0.24% of average loans and leases, during the first quarter of 2019, and an increase from $1.9 million, or 0.29%, for the comparable quarter one year ago.

The net charge-offs during the quarter were primarily attributed to the unguaranteed portion of U.S. government guaranteed loans. Net charge-offs for the second quarter of 2019 included $2.3 million in the unguaranteed portion of U.S. government guaranteed loans, while net charge-offs for the first quarter of 2019 and second quarter of 2018 included $1.7 million in the unguaranteed portion of U.S. government guaranteed loans.

Deposits and Other Liabilities

The following table presents the composition of deposits at the dates indicated:

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

June 30,

 

(dollars in thousands)

 

2019

 

 

2019

 

 

2018

 

 

2018

 

 

2018

 

Non-interest-bearing demand deposits

 

$

1,240,375

 

 

$

1,163,255

 

 

$

1,192,873

 

 

$

1,175,222

 

 

$

1,193,057

 

Interest-bearing checking accounts

 

 

345,081

 

 

 

305,393

 

 

 

296,339

 

 

 

317,145

 

 

 

287,330

 

Money market demand accounts

 

 

728,954

 

 

 

611,634

 

 

 

640,401

 

 

 

661,271

 

 

 

617,108

 

Other savings

 

 

480,756

 

 

 

468,524

 

 

 

476,418

 

 

 

476,879

 

 

 

487,130

 

Time deposits (below $250,000)

 

 

980,162

 

 

 

967,999

 

 

 

911,603

 

 

 

916,014

 

 

 

879,643

 

Time deposits ($250,000 and above)

 

 

284,915

 

 

 

291,711

 

 

 

232,282

 

 

 

194,236

 

 

 

180,609

 

Total deposits

 

$

4,060,243

 

 

$

3,808,516

 

 

$

3,749,916

 

 

$

3,740,767

 

 

$

3,644,877

 

Total deposits were $4.1 billion at June 30, 2019, an increase of $251.7 million compared to March 31, 2019, primarily due to deposits assumed from the acquisition. Non-interest-bearing deposits to total deposits remained steady at 30.5% at March 31, 2019 and June 30, 2019.

The increase in the current quarter was primarily due to:

  • An increase in money market demand deposits of $117.3 million, from $611.6 million at March 31, 2019 to $729.0 million at June 30, 2019, primarily driven by the acquisition and a $45.1 million increase in public funds;
  • An increase in non-interest-bearing demand deposits of $77.1 million, to $1.2 billion at June 30, 2019, primarily driven by the acquisition;
  • An increase in interest-bearing checking deposits of $39.7 million, from $305.4 million at March 31, 2019 to $345.1 million at June 30, 2019, primarily driven by the acquisition;
  • An increase in other savings of $12.2 million, from $468.5 million at March 31, 2019 to $480.8 million at June 30, 2019, primarily driven by the acquisition; and
  • An increase in time deposits of $5.4 million, to $1.3 billion at June 30, 2019, primarily driven by the acquisition.

Total borrowings and other liabilities were $613.3 million at June 30, 2019, an increase of $80.7 million from $532.7 million at March 31, 2019, primarily due to an increase in FHLB advances and an increase in accrued expenses and other liabilities.

Stockholders’ Equity

Total stockholders’ equity was $717.7 million at June 30, 2019, an increase of $48.9 million from $668.7 million at March 31, 2019. Stockholders’ equity increased $101.3 million from $616.4 million at June 30, 2018. The increases were primarily due to net income generated during the quarter and the $29.3 million in stock consideration issued in connection with the acquisition.

The following table presents the actual regulatory capital dollar amounts and ratios of the Company and Byline Bank as of June 30, 2019:

 

 

Actual

 

 

Minimum Capital

Required

 

 

Required to be

Considered

Well Capitalized

 

June 30, 2019

 

Amount

 

 

Ratio

 

 

Amount

 

 

Ratio

 

 

Amount

 

 

Ratio

 

Total capital to risk weighted assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company

 

$

595,847

 

 

 

13.71

%

 

$

347,721

 

 

 

8.00

%

 

N/A

 

 

N/A

 

Bank

 

 

580,084

 

 

 

13.35

%

 

 

347,641

 

 

 

8.00

%

 

$

434,552

 

 

 

10.00

%

Tier 1 capital to risk weighted assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company

 

$

563,448

 

 

 

12.96

%

 

$

260,791

 

 

 

6.00

%

 

N/A

 

 

N/A

 

Bank

 

 

547,685

 

 

 

12.60

%

 

 

260,731

 

 

 

6.00

%

 

$

347,641

 

 

 

8.00

%

Common Equity Tier 1 (CET1) to risk weighted assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company

 

$

506,510

 

 

 

11.65

%

 

$

195,593

 

 

 

4.50

%

 

N/A

 

 

N/A

 

Bank

 

 

547,685

 

 

 

12.60

%

 

 

195,548

 

 

 

4.50

%

 

$

282,459

 

 

 

6.50

%

Tier 1 capital to average assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company

 

$

563,448

 

 

 

11.09

%

 

$

203,214

 

 

 

4.00

%

 

N/A

 

 

N/A

 

Bank

 

 

547,685

 

 

 

10.57

%

 

 

207,238

 

 

 

4.00

%

 

$

259,047

 

 

 

5.00

%

Capital ratios for the period presented are based on the Basel III regulatory capital framework as applied to the Company’s current business and operations, and are subject to, among other things, completion and filing of the Company’s regulatory reports and ongoing regulatory review and implementation guidance.

Conference Call, Webcast and Slide Presentation

The Company will host a conference call and webcast at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) on Friday, July 26, 2019 to discuss its quarterly financial results. Analysts and investors may participate in the question-and-answer session. The call can be accessed via telephone at (877) 512-8755. A recorded replay can be accessed through August 9, 2019 by dialing (877) 344-7529; passcode: 10133221.

A slide presentation relating to the second quarter 2019 results will be accessible prior to the scheduled conference call. The slide presentation and webcast of the conference call can be accessed on the News and Events page of the Company’s investor relations website at www.bylinebancorp.com.

About Byline Bancorp, Inc.

Headquartered in Chicago, Byline Bancorp, Inc. is the parent company for Byline Bank, a full service commercial bank serving small- and medium-sized businesses, financial sponsors, and consumers. Byline Bank has approximately $5.4 billion in assets and operates more than 60 full service branch locations throughout the Chicago and Milwaukee metropolitan areas. Byline Bank offers a broad range of commercial and retail banking products and services including small ticket equipment leasing solutions and is one of the top five Small Business Administration lenders in the United States.

Non-GAAP Financial Measures

This release contains certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). These measures include adjusted net income, adjusted diluted earnings per share, adjusted efficiency ratio, adjusted non-interest expense to average assets, non-interest income to total revenues, adjusted return on average stockholders’ equity, adjusted return on average assets, pre-tax pre-provision return on average assets, adjusted pre-tax pre-provision return on average assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common stockholders' equity, and adjusted return on average tangible common stockholders' equity. Management believes that these non-GAAP financial measures provide useful information to management and investors that is supplementary to the Company’s financial condition, results of operations and cash flows computed in accordance with GAAP; however, management acknowledges that our non-GAAP financial measures have a number of limitations. As such, these disclosures should not be viewed as a substitute for results determined in accordance with GAAP financial measures that we and other companies use. Management also uses these measures for peer comparison. See “Reconciliation of Non-GAAP Financial Measures” in the financial schedules included in this press release for a reconciliation of the non-GAAP financial measures to the comparable GAAP financial measures. Additionally, please refer to the Company’s Annual Report on Form 10-K for the detailed definitions of these non-GAAP financial measures.

Forward-Looking Statements

This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ‘‘may’’, ‘‘might’’, ‘‘should’’, ‘‘could’’, ‘‘predict’’, ‘‘potential’’, ‘‘believe’’, ‘‘expect’’, ‘‘continue’’, ‘‘will’’, ‘‘anticipate’’, ‘‘seek’’, ‘‘estimate’’, ‘‘intend’’, ‘‘plan’’, ‘‘projection’’, ‘‘would’’, ‘‘annualized’’, “target” and ‘‘outlook’’, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. Forward-looking statements involve estimates and known and unknown risks, and reflect various assumptions and involve elements of subjective judgement and analysis, which may or may not prove to be correct, and which are subject to uncertainties and contingencies outside the control of Byline and its respective affiliates, directors, employees and other representatives, which could cause actual results to differ materially from those presented in this communication. No representations, warranties or guarantees are or will be made by Byline as to the reliability, accuracy or completeness of any forward-looking statements contained in this communication or that such forward-looking statements are or will remain based on reasonable assumptions. You should not place undue reliance on any forward-looking statements contained in this communication.

Certain risks and important factors that could affect Byline’s future results are identified in its Annual Report on Form 10-K and other reports filed with the Securities and Exchange Commission, including among other things under the heading “Risk Factors” in such Annual Report on Form 10-K. Any forward-looking statement speaks only as of the date on which it is made, and Byline undertakes no obligation to update any forward-looking statement, whether to reflect events or circumstances after the date on which the statement is made, to reflect new information or the occurrence of unanticipated events, or otherwise unless required under the federal securities laws.

BYLINE BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (unaudited)

 

 

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

June 30,

(dollars in thousands)

 

2019

 

2019

 

2018

 

2018

 

2018

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

57,513

 

 

$

50,026

 

 

$

30,190

 

 

$

25,162

 

 

$

25,299

 

Interest bearing deposits with other banks

 

 

31,802

 

 

 

31,971

 

 

 

91,670

 

 

 

119,594

 

 

 

127,417

 

Cash and cash equivalents

 

 

89,315

 

 

 

81,997

 

 

 

121,860

 

 

 

144,756

 

 

 

152,716

 

Equity and other securities, at fair value

 

 

7,662

 

 

 

7,216

 

 

 

 

 

 

 

Securities available-for-sale, at fair value

 

 

969,029

 

 

 

964,553

 

 

 

817,656

 

 

 

795,408

 

 

 

757,825

 

Securities held-to-maturity, at amortized cost

 

 

4,421

 

 

 

4,425

 

 

 

99,266

 

 

 

102,683

 

 

 

106,613

 

Restricted stock, at cost

 

 

22,937

 

 

 

19,202

 

 

 

19,202

 

 

 

19,202

 

 

 

18,977

 

Loans held for sale

 

 

18,473

 

 

 

510

 

 

 

19,827

 

 

 

8,737

 

 

 

5,822

 

Loans and leases:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and leases

 

 

3,863,148

 

 

 

3,567,566

 

 

 

3,501,626

 

 

 

3,455,802

 

 

 

3,348,692

 

Allowance for loan and lease losses

 

 

(31,132

)

 

 

(27,106

)

 

 

(25,201

)

 

 

(23,424

)

 

 

(19,687

)

Net loans and leases

 

 

3,832,016

 

 

 

3,540,460

 

 

 

3,476,425

 

 

 

3,432,378

 

 

 

3,329,005

 

Servicing assets, at fair value

 

 

19,760

 

 

 

19,534

 

 

 

19,693

 

 

 

20,674

 

 

 

21,587

 

Accrued interest receivable

 

 

12,913

 

 

 

11,974

 

 

 

10,863

 

 

 

11,331

 

 

 

10,670

 

Premises and equipment, net

 

 

96,588

 

 

 

97,069

 

 

 

97,680

 

 

 

106,948

 

 

 

107,300

 

Assets held for sale

 

 

16,329

 

 

 

13,596

 

 

 

14,489

 

 

 

8,343

 

 

 

11,428

 

Other real estate owned, net

 

 

8,070

 

 

 

4,799

 

 

 

5,314

 

 

 

4,891

 

 

 

6,402

 

Goodwill

 

 

145,638

 

 

 

128,177

 

 

 

128,177

 

 

 

127,536

 

 

 

127,536

 

Other intangible assets, net

 

 

35,908

 

 

 

31,646

 

 

 

33,419

 

 

 

35,248

 

 

 

37,139

 

Bank-owned life insurance

 

 

9,634

 

 

 

6,087

 

 

 

5,961

 

 

 

5,923

 

 

 

5,886

 

Deferred tax assets, net

 

 

35,737

 

 

 

30,534

 

 

 

35,643

 

 

 

42,287

 

 

 

48,936

 

Due from counterparty

 

 

34,226

 

 

 

20,691

 

 

 

5,338

 

 

 

14,484

 

 

 

25,569

 

Other assets

 

 

32,580

 

 

 

27,455

 

 

 

31,761

 

 

 

36,580

 

 

 

31,869

 

Total assets

 

$

5,391,236

 

 

$

5,009,925

 

 

$

4,942,574

 

 

$

4,917,409

 

 

$

4,805,280

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest-bearing demand deposits

 

$

1,240,375

 

 

$

1,163,255

 

 

$

1,192,873

 

 

$

1,175,222

 

 

$

1,193,057

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW, savings accounts, and money market accounts

 

 

1,554,791

 

 

 

1,385,551

 

 

 

1,413,158

 

 

 

1,455,295

 

 

 

1,391,568

 

Time deposits

 

 

1,265,077

 

 

 

1,259,710

 

 

 

1,143,885

 

 

 

1,110,250

 

 

 

1,060,252

 

Total deposits

 

 

4,060,243

 

 

 

3,808,516

 

 

 

3,749,916

 

 

 

3,740,767

 

 

 

3,644,877

 

Accrued interest payable

 

 

4,522

 

 

 

4,390

 

 

 

3,484

 

 

 

2,971

 

 

 

2,562

 

Line of credit

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank advances

 

 

500,000

 

 

 

425,000

 

 

 

425,000

 

 

 

425,000

 

 

 

420,000

 

Securities sold under agreements to repurchase

 

 

32,885

 

 

 

34,369

 

 

 

34,166

 

 

 

24,446

 

 

 

24,653

 

Junior subordinated debentures issued to capital trusts, net

 

 

37,059

 

 

 

36,912

 

 

 

36,768

 

 

 

36,615

 

 

 

36,452

 

Accrued expenses and other liabilities

 

 

38,852

 

 

 

31,989

 

 

 

42,568

 

 

 

57,749

 

 

 

60,330

 

Total liabilities

 

 

4,673,561

 

 

 

4,341,176

 

 

 

4,291,902

 

 

 

4,287,548

 

 

 

4,188,874

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

 

10,438

 

 

 

10,438

 

 

 

10,438

 

 

 

10,438

 

 

 

10,438

 

Common stock

 

 

378

 

 

 

362

 

 

 

361

 

 

 

361

 

 

 

360

 

Additional paid-in capital

 

 

578,828

 

 

 

548,005

 

 

 

546,849

 

 

 

545,827

 

 

 

544,686

 

Retained earnings

 

 

129,379

 

 

 

116,363

 

 

 

102,522

 

 

 

85,597

 

 

 

71,257

 

Accumulated other comprehensive loss, net of tax

 

 

(1,348

)

 

 

(6,419

)

 

 

(9,498

)

 

 

(12,362

)

 

 

(10,335

)

Total stockholders’ equity

 

 

717,675

 

 

 

668,749

 

 

 

650,672

 

 

 

629,861

 

 

 

616,406

 

Total liabilities and stockholders’ equity

 

$

5,391,236

 

 

$

5,009,925

 

 

$

4,942,574

 

 

$

4,917,409

 

 

$

4,805,280

 

BYLINE BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

(dollars in thousands, except share and

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

June 30,

 

 

June 30,

 

 

June 30,

 

per share data)

 

2019

 

 

2019

 

 

2018

 

 

2018

 

 

2018

 

 

2019

 

 

2018

 

INTEREST AND DIVIDEND INCOME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans and leases

 

$

59,524

 

 

$

54,383

 

 

$

56,646

 

 

$

55,045

 

 

$

39,627

 

 

$

113,907

 

 

$

73,281

 

Interest on taxable securities

 

 

6,237

 

 

 

5,759

 

 

 

5,334

 

 

 

5,076

 

 

 

4,572

 

 

 

11,996

 

 

 

8,627

 

Interest on tax-exempt securities

 

 

428

 

 

 

343

 

 

 

355

 

 

 

337

 

 

 

229

 

 

 

771

 

 

 

403

 

Other interest and dividend income

 

 

571

 

 

 

625

 

 

 

560

 

 

 

615

 

 

 

413

 

 

 

1,196

 

 

 

672

 

Total interest and dividend income

 

 

66,760

 

 

 

61,110

 

 

 

62,895

 

 

 

61,073

 

 

 

44,841

 

 

 

127,870

 

 

 

82,983

 

INTEREST EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

9,306

 

 

 

8,076

 

 

 

7,115

 

 

 

5,971

 

 

 

3,745

 

 

 

17,382

 

 

 

6,243

 

Federal Home Loan Bank advances

 

 

2,174

 

 

 

2,099

 

 

 

1,719

 

 

 

1,723

 

 

 

1,360

 

 

 

4,273

 

 

 

2,718

 

Subordinated debentures and other

borrowings

 

 

832

 

 

 

850

 

 

 

800

 

 

 

786

 

 

 

680

 

 

 

1,682

 

 

 

1,271

 

Total interest expense

 

 

12,312

 

 

 

11,025

 

 

 

9,634

 

 

 

8,480

 

 

 

5,785

 

 

 

23,337

 

 

 

10,232

 

Net interest income

 

 

54,448

 

 

 

50,085

 

 

 

53,261

 

 

 

52,593

 

 

 

39,056

 

 

 

104,533

 

 

 

72,751

 

PROVISION FOR LOAN AND LEASE LOSSES

 

 

6,391

 

 

 

3,999

 

 

 

3,882

 

 

 

5,842

 

 

 

3,956

 

 

 

10,390

 

 

 

9,071

 

Net interest income after provision

for loan and lease losses

 

 

48,057

 

 

 

46,086

 

 

 

49,379

 

 

 

46,751

 

 

 

35,100

 

 

 

94,143

 

 

 

63,680

 

NON-INTEREST INCOME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fees and service charges on deposits

 

 

1,441

 

 

 

1,770

 

 

 

1,852

 

 

 

1,825

 

 

 

1,456

 

 

 

3,211

 

 

 

2,768

 

Loan servicing revenue

 

 

2,630

 

 

 

2,539

 

 

 

2,667

 

 

 

2,622

 

 

 

2,533

 

 

 

5,169

 

 

 

4,983

 

Loan servicing asset revaluation

 

 

(1,223

)

 

 

(1,261

)

 

 

(2,862

)

 

 

(2,446

)

 

 

(2,074

)

 

 

(2,484

)

 

 

(3,961

)

ATM and interchange fees

 

 

945

 

 

 

717

 

 

 

1,010

 

 

 

1,540

 

 

 

850

 

 

 

1,662

 

 

 

1,763

 

Net gains on sales of securities

available-for-sale

 

 

973

 

 

 

 

 

 

160

 

 

 

 

 

 

4

 

 

 

973

 

 

 

4

 

Change in fair value of equity securities,

net

 

 

551

 

 

 

499

 

 

 

 

 

 

 

 

 

 

 

 

1,050

 

 

 

 

Net gains on sales of loans

 

 

7,472

 

 

 

6,233

 

 

 

9,337

 

 

 

5,015

 

 

 

9,723

 

 

 

13,705

 

 

 

17,199

 

Wealth management and trust income

 

 

626

 

 

 

595

 

 

 

679

 

 

 

674

 

 

 

192

 

 

 

1,221

 

 

 

192

 

Other non-interest income

 

 

768

 

 

 

896

 

 

 

1,447

 

 

 

1,672

 

 

 

1,527

 

 

 

1,664

 

 

 

2,386

 

Total non-interest income

 

 

14,183

 

 

 

11,988

 

 

 

14,290

 

 

 

10,902

 

 

 

14,211

 

 

 

26,171

 

 

 

25,334

 

NON-INTEREST EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

23,652

 

 

 

22,892

 

 

 

21,548

 

 

 

21,312

 

 

 

19,244

 

 

 

46,544

 

 

 

37,522

 

Occupancy expense, net

 

 

4,337

 

 

 

4,280

 

 

 

4,027

 

 

 

3,548

 

 

 

4,499

 

 

 

8,617

 

 

 

8,254

 

Equipment expense

 

 

732

 

 

 

669

 

 

 

641

 

 

 

617

 

 

 

558

 

 

 

1,401

 

 

 

1,161

 

Loan and lease related expenses

 

 

1,841

 

 

 

1,577

 

 

 

2,223

 

 

 

1,015

 

 

 

1,471

 

 

 

3,418

 

 

 

2,871

 

Legal, audit and other professional fees

 

 

2,981

 

 

 

2,066

 

 

 

2,746

 

 

 

2,358

 

 

 

4,418

 

 

 

5,047

 

 

 

6,269

 

Data processing

 

 

3,849

 

 

 

3,144

 

 

 

2,846

 

 

 

2,724

 

 

 

10,371

 

 

 

6,993

 

 

 

12,672

 

Net loss (gain) recognized on other real

estate owned and other related

expenses

 

 

252

 

 

 

196

 

 

 

48

 

 

 

(284

)

 

 

472

 

 

 

448

 

 

 

471

 

Regulatory assessments

 

 

371

 

 

 

(59

)

 

 

462

 

 

 

675

 

 

 

366

 

 

 

312

 

 

 

607

 

Other intangible assets amortization

expense

 

 

1,959

 

 

 

1,773

 

 

 

1,834

 

 

 

1,898

 

 

 

1,130

 

 

 

3,732

 

 

 

1,897

 

Advertising and promotions

 

 

732

 

 

 

709

 

 

 

590

 

 

 

537

 

 

 

347

 

 

 

1,441

 

 

 

596

 

Telecommunications

 

 

537

 

 

 

464

 

 

 

391

 

 

 

435

 

 

 

466

 

 

 

1,001

 

 

 

884

 

Other non-interest expense

 

 

2,711

 

 

 

2,968

 

 

 

2,732

 

 

 

2,880

 

 

 

2,137

 

 

 

5,679

 

 

 

3,889

 

Total non-interest expense

 

 

43,954

 

 

 

40,679

 

 

 

40,088

 

 

 

37,715

 

 

 

45,479

 

 

 

84,633

 

 

 

77,093

 

INCOME BEFORE PROVISION FOR INCOME

TAXES

 

 

18,286

 

 

 

17,395

 

 

 

23,581

 

 

 

19,938

 

 

 

3,832

 

 

 

35,681

 

 

 

11,921

 

PROVISION FOR INCOME TAXES

 

 

5,075

 

 

 

4,798

 

 

 

6,460

 

 

 

5,402

 

 

 

1,064

 

 

 

9,873

 

 

 

2,385

 

NET INCOME

 

 

13,211

 

 

 

12,597

 

 

 

17,121

 

 

 

14,536

 

 

 

2,768

 

 

 

25,808

 

 

 

9,536

 

Dividends on preferred shares

 

 

195

 

 

 

196

 

 

 

196

 

 

 

196

 

 

 

198

 

 

 

391

 

 

 

391

 

INCOME AVAILABLE TO COMMON

STOCKHOLDERS

 

$

13,016

 

 

$

12,401

 

 

$

16,925

 

 

$

14,340

 

 

$

2,570

 

 

$

25,417

 

 

$

9,145

 

EARNINGS PER COMMON SHARE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.35

 

 

$

0.34

 

 

$

0.47

 

 

$

0.40

 

 

$

0.08

 

 

$

0.69

 

 

$

0.30

 

Diluted

 

$

0.34

 

 

$

0.34

 

 

$

0.46

 

 

$

0.39

 

 

$

0.08

 

 

$

0.68

 

 

$

0.29

 

 

BYLINE BANCORP, INC. AND SUBSIDIARIES

SELECTED FINANCIAL DATA (unaudited)

 

 

 

As of or For the Three Months Ended

 

 

As of or For the Six Months Ended

 

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

June 30,

 

 

June 30,

 

 

June 30,

 

(dollars in thousands, except share and per share data)

 

2019

 

 

2019

 

 

2018

 

 

2018

 

 

2018

 

 

2019

 

 

2018

 

Summary of Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

54,448

 

 

$

50,085

 

 

$

53,261

 

 

$

52,593

 

 

$

39,056

 

 

$

104,533

 

 

$

72,751

 

Provision for loan and lease losses

 

 

6,391

 

 

 

3,999

 

 

 

3,882

 

 

 

5,842

 

 

 

3,956

 

 

 

10,390

 

 

 

9,071

 

Non-interest income

 

 

14,183

 

 

 

11,988

 

 

 

14,290

 

 

 

10,902

 

 

 

14,211

 

 

 

26,171

 

 

 

25,334

 

Non-interest expense

 

 

43,954

 

 

 

40,679

 

 

 

40,088

 

 

 

37,715

 

 

 

45,479

 

 

 

84,633

 

 

 

77,093

 

Income before provision for income taxes

 

 

18,286

 

 

 

17,395

 

 

 

23,581

 

 

 

19,938

 

 

 

3,832

 

 

 

35,681

 

 

 

11,921

 

Provision for income taxes

 

 

5,075

 

 

 

4,798

 

 

 

6,460

 

 

 

5,402

 

 

 

1,064

 

 

 

9,873

 

 

 

2,385

 

Net income

 

 

13,211

 

 

 

12,597

 

 

 

17,121

 

 

 

14,536

 

 

 

2,768

 

 

 

25,808

 

 

 

9,536

 

Dividends on preferred shares

 

 

195

 

 

 

196

 

 

 

196

 

 

 

196

 

 

 

198

 

 

 

391

 

 

 

391

 

Net income available to common stockholders

 

$

13,016

 

 

$

12,401

 

 

$

16,925

 

 

$

14,340

 

 

$

2,570

 

 

$

25,417

 

 

$

9,145

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per Common Share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

 

$

0.35

 

 

$

0.34

 

 

$

0.47

 

 

$

0.40

 

 

$

0.08

 

 

$

0.69

 

 

$

0.30

 

Diluted earnings per common share

 

$

0.34

 

 

$

0.34

 

 

$

0.46

 

 

$

0.39

 

 

$

0.08

 

 

$

0.68

 

 

$

0.29

 

Adjusted diluted earnings per common share(2)(3)(4)

 

$

0.41

 

 

$

0.38

 

 

$

0.49

 

 

$

0.40

 

 

$

0.32

 

 

$

0.79

 

 

$

0.52

 

Weighted average common shares outstanding (basic)

 

 

37,263,352

 

 

 

36,169,477

 

 

 

36,116,189

 

 

 

36,042,914

 

 

 

31,614,973

 

 

 

36,719,436

 

 

 

30,459,495

 

Weighted average common shares outstanding (diluted)

 

 

37,948,006

 

 

 

36,876,574

 

 

 

36,900,589

 

 

 

36,958,209

 

 

 

32,568,396

 

 

 

37,445,407

 

 

 

31,448,320

 

Common shares outstanding

 

 

38,115,219

 

 

 

36,398,144

 

 

 

36,343,239

 

 

 

36,279,600

 

 

 

36,218,955

 

 

 

38,115,219

 

 

 

36,218,955

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Key Ratios and Performance Metrics (annualized where

applicable)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin

 

 

4.51

%

 

 

4.43

%

 

 

4.69

%

 

 

4.73

%

 

 

4.43

%

 

 

4.47

%

 

 

4.44

%

Cost of deposits

 

 

0.92

%

 

 

0.87

%

 

 

0.75

%

 

 

0.64

%

 

 

0.52

%

 

 

0.90

%

 

 

0.47

%

Efficiency ratio(1)

 

 

61.19

%

 

 

62.68

%

 

 

56.63

%

 

 

56.41

%

 

 

83.26

%

 

 

61.90

%

 

 

76.66

%

Adjusted efficiency ratio(1)(2)(3)

 

 

56.02

%

 

 

59.55

%

 

 

54.76

%

 

 

55.62

%

 

 

63.28

%

 

 

57.70

%

 

 

65.69

%

Non-interest expense to average assets

 

 

3.34

%

 

 

3.32

%

 

 

3.25

%

 

 

3.11

%

 

 

4.72

%

 

 

3.33

%

 

 

4.30

%

Adjusted non-interest expense to average assets(2)(3)

 

 

3.07

%

 

 

3.17

%

 

 

3.15

%

 

 

3.07

%

 

 

3.62

%

 

 

3.12

%

 

 

3.70

%

Return on average stockholders' equity

 

 

7.60

%

 

 

7.75

%

 

 

10.61

%

 

 

9.22

%

 

 

2.14

%

 

 

7.67

%

 

 

3.93

%

Adjusted return on average stockholders' equity(2)(3)(4)

 

 

9.16

%

 

 

8.61

%

 

 

11.21

%

 

 

9.47

%

 

 

8.18

%

 

 

8.90

%

 

 

6.89

%

Return on average assets

 

 

1.00

%

 

 

1.03

%

 

 

1.39

%

 

 

1.20

%

 

 

0.29

%

 

 

1.02

%

 

 

0.53

%

Adjusted return on average assets(2)(3)(4)

 

 

1.21

%

 

 

1.14

%

 

 

1.47

%

 

 

1.23

%

 

 

1.10

%

 

 

1.18

%

 

 

0.93

%

Non-interest income to total revenues(2)

 

 

20.67

%

 

 

19.31

%

 

 

21.16

%

 

 

17.17

%

 

 

26.68

%

 

 

20.02

%

 

 

25.83

%

Pre-tax pre-provision return on average assets(2)

 

 

1.88

%

 

 

1.75

%

 

 

2.23

%

 

 

2.13

%

 

 

0.81

%

 

 

1.81

%

 

 

1.17

%

Adjusted pre-tax pre-provision return on average assets(2)(3)

 

 

2.15

%

 

 

1.91

%

 

 

2.33

%

 

 

2.17

%

 

 

1.91

%

 

 

2.03

%

 

 

1.77

%

Return on average tangible common stockholders' equity(2)

 

 

11.32

%

 

 

11.37

%

 

 

15.49

%

 

 

13.81

%

 

 

3.34

%

 

 

11.35

%

 

 

5.40

%

Adjusted return on average tangible common stockholders'

equity(2)(3)(4)

 

 

13.44

%

 

 

12.54

%

 

 

16.31

%

 

 

14.16

%

 

 

11.05

%

 

 

13.00

%

 

 

9.09

%

Non-interest-bearing deposits to total deposits

 

 

30.55

%

 

 

30.54

%

 

 

31.81

%

 

 

31.42

%

 

 

32.73

%

 

 

30.55

%

 

 

32.73

%

Loans and leases held for sale and loans and lease held for

investment to total deposits

 

 

95.60

%

 

 

93.69

%

 

 

93.91

%

 

 

92.62

%

 

 

92.03

%

 

 

95.60

%

 

 

92.03

%

Deposits to total liabilities

 

 

86.88

%

 

 

87.73

%

 

 

87.37

%

 

 

87.25

%

 

 

87.01

%

 

 

86.88

%

 

 

87.01

%

Deposits per branch

 

$

66,561

 

 

$

65,664

 

 

$

63,558

 

 

$

63,403

 

 

$

61,778

 

 

$

66,561

 

 

$

61,778

 

Tangible book value per common share(2)

 

$

13.79

 

 

$

13.70

 

 

$

13.17

 

 

$

12.59

 

 

$

12.18

 

 

$

13.79

 

 

$

12.18

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Quality Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing loans and leases to total loans and leases

held for investment, net before ALLL

 

 

0.95

%

 

 

0.85

%

 

 

0.79

%

 

 

0.87

%

 

 

0.81

%

 

 

0.95

%

 

 

0.81

%

ALLL to total loans and leases held for investment, net

before ALLL

 

 

0.81

%

 

 

0.76

%

 

 

0.72

%

 

 

0.68

%

 

 

0.59

%

 

 

0.81

%

 

 

0.59

%

Net charge-offs to average total loans and leases held for

investment, net before ALLL

 

 

0.25

%

 

 

0.24

%

 

 

0.24

%

 

 

0.25

%

 

 

0.29

%

 

 

0.25

%

 

 

0.50

%

Acquisition accounting adjustments(5)

 

$

37,109

 

 

$

29,341

 

 

$

34,029

 

 

$

42,375

 

 

$

52,090

 

 

$

37,109

 

 

$

52,090

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common equity to total assets

 

 

13.12

%

 

 

13.14

%

 

 

12.95

%

 

 

12.60

%

 

 

12.61

%

 

 

13.12

%

 

 

12.61

%

Tangible common equity to tangible assets(2)

 

 

10.09

%

 

 

10.28

%

 

 

10.01

%

 

 

9.60

%

 

 

9.51

%

 

 

10.09

%

 

 

9.51

%

Leverage ratio

 

 

11.09

%

 

 

11.27

%

 

 

11.05

%

 

 

10.78

%

 

 

10.57

%

 

 

11.09

%

 

 

10.57

%

Common equity tier 1 capital ratio

 

 

11.65

%

 

 

12.14

%

 

 

11.85

%

 

 

11.26

%

 

 

10.88

%

 

 

11.65

%

 

 

10.88

%

Tier 1 capital ratio

 

 

12.96

%

 

 

13.57

%

 

 

13.30

%

 

 

12.71

%

 

 

12.36

%

 

 

12.96

%

 

 

12.36

%

Total capital ratio

 

 

13.71

%

 

 

14.28

%

 

 

13.99

%

 

 

13.37

%

 

 

12.92

%

 

 

13.71

%

 

 

12.92

%

(1)

Represents non-interest expense less amortization of intangible assets divided by net interest income and non-interest income.

(2)

Represents a non-GAAP financial measure. See “Reconciliation of non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

(3)

Calculation excludes impairment charges, merger-related expenses, and core systems conversion expense.

(4)

Calculation excludes incremental income tax expense or benefit related to changes in corporate income tax rates and reversal of valuation allowance on net deferred tax assets.

(5)

Represents the remaining unamortized premium or unaccreted discount as a result of applying the fair value adjustment at the time of the business combination on acquired loans.

 

BYLINE BANCORP, INC. AND SUBSIDIARIES

QUARTER-TO-DATE STATEMENT OF AVERAGE INTEREST-EARNING ASSETS AND AVERAGE INTEREST-BEARING LIABILITIES (unaudited)

 

 

 

For the Three Months Ended June 30,

 

 

2019

 

2018

(dollars in thousands)

 

Average

Balance(5)

 

 

Interest

Inc / Exp

 

 

Average

Yield /

Rate

 

Average

Balance(5)

 

 

Interest

Inc / Exp

 

 

Average

Yield /

Rate

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

35,346

 

 

$

245

 

 

 

2.78

%

 

$

68,019

 

 

$

199

 

 

 

1.17

%

Loans and leases(1)

 

 

3,759,634

 

 

 

59,524

 

 

 

6.35

%

 

 

2,638,757

 

 

 

39,627

 

 

 

6.02

%

Taxable securities

 

 

975,693

 

 

 

6,563

 

 

 

2.70

%

 

 

790,568

 

 

 

4,786

 

 

 

2.43

%

Tax-exempt securities(2)

 

 

68,314

 

 

 

428

 

 

 

2.52

%

 

 

36,749

 

 

 

229

 

 

 

2.50

%

Total interest-earning assets

 

$

4,838,987

 

 

$

66,760

 

 

 

5.53

%

 

$

3,534,093

 

 

$

44,841

 

 

 

5.09

%

Allowance for loan and lease losses

 

 

(28,203

)

 

 

 

 

 

 

 

 

 

(18,292

)

 

 

 

 

 

 

 

All other assets

 

 

464,036

 

 

 

 

 

 

 

 

 

 

347,383

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

5,274,820

 

 

 

 

 

 

 

 

 

$

3,863,184

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’

EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest checking

 

$

333,725

 

 

$

452

 

 

 

0.54

%

 

$

227,760

 

 

$

124

 

 

 

0.22

%

Money market accounts

 

 

695,986

 

 

 

1,790

 

 

 

1.03

%

 

 

469,066

 

 

 

781

 

 

 

0.67

%

Savings

 

 

477,775

 

 

 

118

 

 

 

0.10

%

 

 

454,295

 

 

 

83

 

 

 

0.07

%

Time deposits

 

 

1,278,488

 

 

 

6,946

 

 

 

2.18

%

 

 

864,348

 

 

 

2,757

 

 

 

1.28

%

Total interest-bearing

deposits

 

 

2,785,974

 

 

 

9,306

 

 

 

1.34

%

 

 

2,015,469

 

 

 

3,745

 

 

 

0.75

%

Federal Home Loan Bank advances

 

 

426,446

 

 

 

2,174

 

 

 

2.04

%

 

 

342,825

 

 

 

1,360

 

 

 

1.59

%

Other borrowed funds

 

 

73,358

 

 

 

832

 

 

 

4.55

%

 

 

57,644

 

 

 

680

 

 

 

4.73

%

Total borrowings

 

 

499,804

 

 

 

3,006

 

 

 

2.41

%

 

 

400,469

 

 

 

2,040

 

 

 

2.04

%

Total interest-bearing liabilities

 

$

3,285,778

 

 

$

12,312

 

 

 

1.50

%

 

$

2,415,938

 

 

$

5,785

 

 

 

0.96

%

Non-interest-bearing demand deposits

 

 

1,254,173

 

 

 

 

 

 

 

 

 

 

891,175

 

 

 

 

 

 

 

 

Other liabilities

 

 

37,941

 

 

 

 

 

 

 

 

 

 

37,524

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

 

696,928

 

 

 

 

 

 

 

 

 

 

518,547

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND

STOCKHOLDERS’ EQUITY

 

$

5,274,820

 

 

 

 

 

 

 

 

 

$

3,863,184

 

 

 

 

 

 

 

 

Net interest spread(3)

 

 

 

 

 

 

 

 

 

 

4.03

%

 

 

 

 

 

 

 

 

 

 

4.13

%

Net interest income

 

 

 

 

 

$

54,448

 

 

 

 

 

 

 

 

 

$

39,056

 

 

 

 

Net interest margin(4)

 

 

 

 

 

 

 

 

 

 

4.51

%

 

 

 

 

 

 

 

 

 

 

4.43

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loan accretion impact on margin

 

 

 

 

 

$

4,868

 

 

 

0.40

%

 

 

 

 

 

$

3,604

 

 

 

0.41

%

(1)

Loan and lease balances are net of deferred origination fees and costs and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances.

(2)

Interest income and rates exclude the effects of a tax equivalent adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality.

(3)

Represents the average rate earned on interest-earning assets minus the average rate paid on interest-bearing liabilities.

(4)

Represents net interest income (annualized) divided by total average earning assets.

(5)

Average balances are average daily balances.

BYLINE BANCORP, INC. AND SUBSIDIARIES

YEAR-TO-DATE STATEMENT OF AVERAGE INTEREST-EARNING ASSETS AND AVERAGE INTEREST-BEARING LIABILITIES (unaudited)

 

 

 

For the Six Months Ended June 30,

 

 

2019

 

2018

(dollars in thousands)

 

Average

Balance(5)

 

 

Interest

Inc / Exp

 

 

Average

Yield /

Rate

 

Average

Balance(5)

 

 

Interest

Inc / Exp

 

 

Average

Yield /

Rate

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

50,969

 

 

$

546

 

 

 

2.16

%

 

$

53,337

 

 

$

281

 

 

 

1.06

%

Loans and leases(1)

 

 

3,647,427

 

 

 

113,907

 

 

 

6.30

%

 

 

2,458,019

 

 

 

73,281

 

 

 

6.01

%

Taxable securities

 

 

951,048

 

 

 

12,646

 

 

 

2.68

%

 

 

760,806

 

 

 

9,018

 

 

 

2.39

%

Tax-exempt securities(2)

 

 

61,792

 

 

 

771

 

 

 

2.52

%

 

 

32,140

 

 

 

403

 

 

 

2.53

%

Total interest-earning assets

 

$

4,711,236

 

 

$

127,870

 

 

 

5.47

%

 

$

3,304,302

 

 

$

82,983

 

 

 

5.06

%

Allowance for loan and lease losses

 

 

(26,786

)

 

 

 

 

 

 

 

 

 

(17,828

)

 

 

 

 

 

 

 

All other assets

 

 

435,672

 

 

 

 

 

 

 

 

 

 

327,357

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

5,120,122

 

 

 

 

 

 

 

 

 

$

3,613,831

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’

EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest checking

 

$

313,499

 

 

$

866

 

 

 

0.56

%

 

$

207,337

 

 

$

162

 

 

 

0.16

%

Money market accounts

 

 

654,723

 

 

 

3,249

 

 

 

1.00

%

 

 

407,647

 

 

 

1,152

 

 

 

0.57

%

Savings

 

 

474,509

 

 

 

257

 

 

 

0.11

%

 

 

445,663

 

 

 

159

 

 

 

0.07

%

Time deposits

 

 

1,237,182

 

 

 

13,010

 

 

 

2.12

%

 

 

799,410

 

 

 

4,770

 

 

 

1.20

%

Total interest-bearing

deposits

 

 

2,679,913

 

 

 

17,382

 

 

 

1.31

%

 

 

1,860,057

 

 

 

6,243

 

 

 

0.68

%

Federal Home Loan Bank advances

 

 

429,890

 

 

 

4,273

 

 

 

2.00

%

 

 

353,125

 

 

 

2,718

 

 

 

1.55

%

Other borrowed funds

 

 

72,325

 

 

 

1,682

 

 

 

4.69

%

 

 

57,061

 

 

 

1,271

 

 

 

4.49

%

Total borrowings

 

 

502,215

 

 

 

5,955

 

 

</