Allegiance Bancshares Earnings 2020-09-30

Balance Sheet	Income Statement	Cash Flow

abtx-10q_20200930.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED September 30, 2020

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM TO

COMMISSION FILE NUMBER: 001-37585

Allegiance Bancshares, Inc.

(Exact name of registrant as specified in its charter)

Texas

26-3564100

(State or other jurisdiction

of incorporation or organization)

(I.R.S. Employer

Identification No.)

8847 West Sam Houston Parkway, N., Suite 200

Houston, Texas 77040

(Address of principal executive offices, including zip code)

(281) 894-3200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange on which registered

Common Stock, par value, $1.00 per share

ABTX

NASDAQ Global Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☐	Accelerated filer	☒

Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 3, 2020, the registrant had 20,447,510 shares common stock, $1.00 par value per share, outstanding.

ALLEGIANCE BANCSHARES, INC.

INDEX TO FORM 10-Q

September 30, 2020


PART I—FINANCIAL INFORMATION

Item 1.	Interim Consolidated Financial Statements	3
	Consolidated Balance Sheets (unaudited)	3
	Consolidated Statements of Income (unaudited)	4
	Consolidated Statements of Comprehensive Income (unaudited)	5
	Consolidated Statements of Changes in Shareholders' Equity (unaudited)	6
	Consolidated Statements of Cash Flows (unaudited)	7
	Condensed Notes to Interim Consolidated Financial Statements (unaudited)	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	63
Item 4.	Controls and Procedures	64

PART II—OTHER INFORMATION

Item 1.	Legal Proceedings	65
Item 1A.	Risk Factors	65
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	67
Item 3.	Defaults upon Senior Securities	67
Item 4.	Mine Safety Disclosures	67
Item 5.	Other Information	67
Item 6.	Exhibits	68
Signatures		69

Table of Contents

PART I—FINANCIAL INFORMATION

ITEM 1. INTERIM CONSOLIDATED FINANCIAL STATEMENTS

ALLEGIANCE BANCSHARES, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30			December 31,
	2020			2019
	(Dollars in thousands, except share data)
ASSETS
Cash and due from banks	$	327,416		$	213,347
Interest-bearing deposits at other financial institutions		19,732			132,901
Total cash and cash equivalents		347,148			346,248
Available for sale securities, at fair value		663,301			372,545
Loans held for investment		4,592,362			3,915,310
Less: allowance for loan losses		(48,698	)		(29,438	)
Loans, net		4,543,664			3,885,872
Accrued interest receivable		36,996			15,468
Premises and equipment, net		69,887			66,790
Other real estate owned		8,876			8,337
Federal Home Loan Bank stock		9,716			6,242
Bank owned life insurance		27,542			27,104
Goodwill		223,642			223,642
Core deposit intangibles, net		18,907			21,876
Other assets		18,072			18,530
TOTAL ASSETS	$	5,967,751		$	4,992,654
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES:
Deposits:
Noninterest-bearing	$	1,772,700		$	1,252,232
Interest-bearing
Demand		409,137			367,278
Money market and savings		1,483,370			1,258,008
Certificates and other time		1,252,159			1,190,583
Total interest-bearing deposits		3,144,666			2,815,869
Total deposits		4,917,366			4,068,101
Accrued interest payable		3,082			4,326
Borrowed funds		155,512			75,503
Subordinated debt		108,191			107,799
Other liabilities		30,547			27,060
Total liabilities		5,214,698			4,282,789
COMMITMENTS AND CONTINGENCIES (See Note 14)
SHAREHOLDERS’ EQUITY:
Preferred stock, $1 par value; 1,000,000 shares authorized; no shares issued or outstanding		—			—
Common stock, $1 par value; 80,000,000 shares authorized; 20,444,630 shares issued and outstanding at September 30, 2020 and 20,523,816 shares issued and outstanding at December 31, 2019		20,445			20,524
Capital surplus		516,151			521,066
Retained earnings		186,866			163,375
Accumulated other comprehensive income		29,591			4,900
Total shareholders’ equity		753,053			709,865
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	5,967,751		$	4,992,654

See condensed notes to interim consolidated financial statements.

Table of Contents

ALLEGIANCE BANCSHARES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended September 30,					Nine Months Ended September 30,
	2020		2019			2020			2019
	(Dollars in thousands, except per share data)
INTEREST INCOME:
Loans, including fees	$	56,418	$	55,790		$	167,463		$	165,995
Securities:
Taxable		2,095		2,090			6,024			4,909
Tax-exempt		2,280		483			4,995			2,465
Deposits in other financial institutions		18		302			233			1,391
Total interest income		60,811		58,665			178,715			174,760
INTEREST EXPENSE:
Demand, money market and savings deposits		1,657		4,975			7,750			13,216
Certificates and other time deposits		5,239		6,909			17,168			20,173
Borrowed funds		558		1,183			1,626			4,128
Subordinated debt		1,448		761			4,390			2,232
Total interest expense		8,902		13,828			30,934			39,749
NET INTEREST INCOME		51,909		44,837			147,781			135,011
Provision for loan losses		1,347		2,597			23,006			5,006
Net interest income after provision for loan losses		50,562		42,240			124,775			130,005
NONINTEREST INCOME:
Nonsufficient funds fees		75		168			304			469
Service charges on deposit accounts		325		379			1,125			1,069
Gain on sale of securities		—		—			287			846
Gain (loss) on sale of other real estate and other repossessed assets		117		—			(258	)		71
Bank owned life insurance income		144		153			438			467
Rebate from correspondent bank		98		900			680			2,680
Other		1,091		1,289			3,561			4,421
Total noninterest income		1,850		2,889			6,137			10,023
NONINTEREST EXPENSE:
Salaries and employee benefits		20,034		20,221			59,149			59,320
Net occupancy and equipment		2,057		1,973			5,890			6,139
Depreciation		946		822			2,697			2,331
Data processing and software amortization		2,125		2,058			5,885			5,390
Professional fees		756		667			2,129			1,793
Regulatory assessments and FDIC insurance		875		(41	)		2,116			1,489
Core deposit intangibles amortization		989		1,178			2,969			3,534
Communications		355		455			1,162			1,353
Advertising		327		449			1,218			1,770
Other real estate expense		2,017		137

Price	33.59	EPS	2
Shares	22	P/E	19
MCap	725	P/FCF	13
Net Debt	-301	EBIT	89
TEV	425	TEV/EBIT	5
TTM 2019-09-30, in MM, except price, ratios

10-Q	2020-09-30	Filed 2020-11-06
10-Q	2020-06-30	Filed 2020-07-31
10-Q	2020-03-31	Filed 2020-05-01
10-K	2019-12-31	Filed 2020-03-09
10-Q	2019-09-30	Filed 2019-11-01
10-Q	2019-06-30	Filed 2019-08-01
10-Q	2019-03-31	Filed 2019-05-06
10-K	2018-12-31	Filed 2019-03-11
10-Q	2018-09-30	Filed 2018-11-01
10-Q	2018-06-30	Filed 2018-08-03
10-Q	2018-03-31	Filed 2018-05-08
10-K	2017-12-31	Filed 2018-03-09
10-Q	2017-09-30	Filed 2017-11-02
10-Q	2017-06-30	Filed 2017-08-03
10-Q	2017-03-31	Filed 2017-05-05
10-K	2016-12-31	Filed 2017-03-10
10-Q	2016-09-30	Filed 2016-11-10
10-Q	2016-06-30	Filed 2016-08-12
10-Q	2016-03-31	Filed 2016-05-10
10-K	2015-12-31	Filed 2016-03-22
10-Q	2015-09-30	Filed 2015-11-20

8-K	2021-01-28	Earnings, Exhibits
8-K	2021-01-28	Exhibits
8-K	2020-10-29
8-K	2020-09-08
8-K	2020-07-30
8-K	2020-04-30
8-K	2020-04-23
8-K	2020-04-08
8-K	2020-02-27
8-K	2020-02-07
8-K	2020-01-30
8-K	2020-01-29
8-K	2019-10-25
8-K	2019-10-24
8-K	2019-09-27
8-K	2019-09-20
8-K	2019-09-20
8-K	2019-09-11
8-K	2019-07-26
8-K	2019-07-26
8-K	2019-04-26
8-K	2019-04-25
8-K	2019-02-04
8-K	2019-01-25
8-K	2019-01-24
8-K	2018-12-28
8-K	2018-11-21
8-K	2018-10-25
8-K	2018-09-28
8-K	2018-09-14
8-K	2018-07-26
8-K	2018-04-30
8-K	2018-04-27
8-K	2018-04-26
8-K	2018-01-25

EX-31.1	abtx-ex311_7.htm
EX-31.2	abtx-ex312_9.htm
EX-32.1	abtx-ex321_8.htm
EX-32.2	abtx-ex322_6.htm

ABTX 10Q Quarterly Report

Allegiance Bancshares Earnings 2020-09-30