Triumph Bancorp, Inc. [TBK] Filings

10-Q 1 tbk-20220630.htm 10-Q tbk-20220630

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 June 30, 2022


☐			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 001-36722

___________________________________________________________

TRIUMPH BANCORP, INC.

(Exact name of registrant as specified in its charter)

___________________________________________________________


Texas						20-0477066
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

12700 Park Central Drive, Suite 1700

Dallas, Texas 75251

(Address of principal executive offices)

(214) 365-6900

(Registrant’s telephone number, including area code)

___________________________________________________________

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 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 x No o

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 x No o

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 the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	x	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 o

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock — $0.01 par value, 24,464,746 shares, as of July 18, 2022.

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 $0.01 per share

TBK

NASDAQ Global Select Market

Depositary Shares Each Representing a 1/40th Interest in a Share of 7.125% Series C Fixed-Rate Non-Cumulative Perpetual Preferred Stock, par value $0.01 per share

TBKCP

NASDAQ Global Select Market

Table of Contents

TRIUMPH BANCORP, INC.

FORM 10-Q

June 30, 2022

TABLE OF CONTENTS


PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements
	Consolidated Balance Sheets	2
	Consolidated Statements of Income	3
	Consolidated Statements of Comprehensive Income	4
	Consolidated Statements of Changes in Stockholders’ Equity	5
	Consolidated Statements of Cash Flows	7
	Condensed Notes to Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	49

Item 3.	Quantitative and Qualitative Disclosures About Market Risks	97

Item 4.	Controls and Procedures	99

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	99

Item 1A.	Risk Factors	99

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	100

Item 3.	Defaults Upon Senior Securities	100

Item 4.	Mine Safety Disclosures	100

Item 5.	Other Information	100

Item 6.	Exhibits	100

Table of Contents

PART I – FINANCIAL INFORMATION

ITEM 1

FINANCIAL STATEMENTS

Table of Contents

TRIUMPH BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

June 30, 2022 and December 31, 2021

(Dollar amounts in thousands)


	June 30, 2022		December 31, 2021
	(Unaudited)
ASSETS
Cash and due from banks	$	84,625	$	122,929
Interest bearing deposits with other banks	639,612		260,249
Total cash and cash equivalents	724,237		383,178
Securities - equity investments with readily determinable fair values	5,050		5,504
Securities - available for sale	215,909		182,426
Securities - held to maturity, net of allowance for credit losses of $2,355 and $2,082, respectively, fair value of $5,790 and $5,447, respectively	4,335		4,947
Loans held for sale	6		7,330
Loans, net of allowance for credit losses of $43,407 and $42,213, respectively	4,391,959		4,825,359
Assets held for sale	24,405		—
Federal Home Loan Bank and other restricted stock	6,169		10,146
Premises and equipment, net	105,293		105,729
Other real estate owned, net	168		524
Goodwill	233,709		233,727
Intangible assets, net	36,957		43,129
Bank-owned life insurance	41,278		40,993
Deferred tax asset, net	13,117		10,023
Indemnification asset	4,377		4,786
Other assets	148,538		98,449
Total assets	$	5,955,507	$	5,956,250
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits
Noninterest bearing	$	2,085,249	$	1,925,370
Interest bearing	2,695,675		2,721,309
Total deposits	4,780,924		4,646,679
Deposits held for sale	1,410		—
Customer repurchase agreements	11,746		2,103
Federal Home Loan Bank advances	30,000		180,000
Paycheck Protection Program Liquidity Facility	—		27,144
Subordinated notes	107,377		106,957
Junior subordinated debentures	40,876		40,602
Other liabilities	108,893		93,901
Total liabilities	5,081,226		5,097,386
Commitments and contingencies - See Note 9 and Note 10
Stockholders' equity - See Note 13
Preferred stock	45,000		45,000
Common stock, 24,457,777 and 25,158,879 shares outstanding, respectively	283		283
Additional paid-in-capital	524,636		510,939
Treasury stock, at cost	(156,924)		(104,743)
Retained earnings	466,269		399,351
Accumulated other comprehensive income (loss)	(4,983)		8,034
Total stockholders’ equity	874,281		858,864
Total liabilities and stockholders' equity	$	5,955,507	$	5,956,250

See accompanying condensed notes to consolidated financial statements.

Table of Contents

TRIUMPH BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

For the Three and Six Months Ended June 30, 2022 and 2021

(Dollar amounts in thousands, except per share amounts)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Interest and dividend income:
Loans, including fees	$	44,131	$	45,988	$	84,978	$	94,694
Factored receivables, including fees	60,026		47,328		121,232		85,123
Securities	1,329		1,187		2,507		2,837
FHLB and other restricted stock	34		27		110		103
Cash deposits	787		158		915		284
Total interest income	106,307		94,688		209,742		183,041
Interest expense:
Deposits	2,706		2,470		4,267		5,842
Subordinated notes	1,302		1,350		2,601		2,699
Junior subordinated debentures	556		446		1,010		888
Other borrowings	315		140		357		310
Total interest expense	4,879		4,406		8,235		9,739
Net interest income	101,428		90,282		201,507		173,302
Credit loss expense (benefit)	2,901		(1,806)		3,402		(9,651)
Net interest income after credit loss expense (benefit)	98,527		92,088		198,105		182,953
Noninterest income:
Service charges on deposits	1,664		1,857		3,627		3,644
Card income	2,080		2,225		4,091		4,197
Net OREO gains (losses) and valuation adjustments	18		(287)		(114)		(367)
Net gains (losses) on sale or call of securities	2,514		1		2,514		1
Net gains (losses) on sale of loans	17,269		1,019		17,203		2,588
Fee income	6,273		4,470		11,976		6,719
Insurance commissions	1,346		1,272		3,018		2,758
Other	16,996		3,339		16,966		8,647
Total noninterest income	48,160		13,896		59,281		28,187
Noninterest expense:
Salaries and employee benefits	54,257		41,658		100,541		77,638
Occupancy, furniture and equipment	6,507		6,112		12,943		11,891
FDIC insurance and other regulatory assessments	382		500		793		1,477
Professional fees	3,607		5,052		7,266		7,597
Amortization of intangible assets	3,064		2,428		6,172		4,403
Advertising and promotion	1,785		1,241		2,987		2,131
Communications and technology	9,820		6,028		18,932		11,928
Other	9,185		7,779		17,537		14,625
Total noninterest expense	88,607		70,798		167,171		131,690
Net income before income tax expense	58,080		35,186		90,215		79,450
Income tax expense	13,888		7,204		21,694		17,545
Net income	$	44,192	$	27,982	$	68,521	$	61,905
Dividends on preferred stock	(802)		(802)		(1,603)		(1,603)
Net income available to common stockholders	$	43,390	$	27,180	$	66,918	$	60,302
Earnings per common share
Basic	$	1.78	$	1.10	$	2.72	$	2.44
Diluted	$	1.74	$	1.08	$	2.66	$	2.39

See accompanying condensed notes to consolidated financial statements.

Table of Contents

TRIUMPH BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the Three and Six Months Ended June 30, 2022 and 2021

(Dollar amounts in thousands)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Net income	$	44,192	$	27,982	$	68,521	$	61,905
Other comprehensive income:
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during the period	(5,457)		(611)		(8,358)		(926)
Tax effect	1,251		145		1,941		214
Unrealized holding gains (losses) arising during the period, net of taxes	(4,206)		(466)		(6,417)		(712)
Reclassification of amount realized through sale or call of securities	(2,514)		(1)		(2,514)		(1)
Tax effect	619		—		619		—
Reclassification of amount realized through sale or call of securities, net of taxes	(1,895)		(1)		(1,895)		(1)
Change in unrealized gains (losses) on securities, net of tax	(6,101)		(467)		(8,312)		(713)

Unrealized gains (losses) on derivative financial instruments:
Unrealized holding gains (losses) arising during the period	—		(592)		3,152		3,071
Tax effect	—		141		(754)		(734)
Unrealized holding gains (losses) arising during the period, net of taxes	—		(451)		2,398		2,337
Reclassification of amount of (gains) losses recognized into income	(9,083)		29		(9,316)		52
Tax effect	2,144		(7)		2,213		(12)
Reclassification of amount of (gains) losses recognized into income, net of taxes	(6,939)		22		(7,103)		40
Change in unrealized gains (losses) on derivative financial instruments	(6,939)		(429)		(4,705)		2,377

Total other comprehensive income (loss)	(13,040)		(896)		(13,017)		1,664
Comprehensive income	$	31,152	$	27,086	$	55,504	$	63,569

See accompanying condensed notes to consolidated financial statements.

Table of Contents

TRIUMPH BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the Three and Six Months Ended June 30, 2022 and 2021

(Dollar amounts in thousands)

(Unaudited)


	Preferred Stock		Common Stock			Additional Paid-in- Capital		Treasury Stock			Retained Earnings		Accumulated		Total Stockholders' Equity
	Liquidation Preference Amount		Shares Outstanding	Par Amount				Shares Outstanding	Cost				Other Comprehensive Income (Loss)
Balance, January 1, 2022	$	45,000	25,158,879	$	283	$	510,939	3,102,801	$	(104,743)	$	399,351	$	8,034	$	858,864
Issuance of restricted stock awards	—		5,502	—		—		—	—		—		—		—
Stock option exercises, net	—		2,021	—		(74)		—	—		—		—		(74)
Issuance of common stock pursuant to the Employee Stock Purchase Plan	—		10,585	—		688		—	—		—		—		688
Stock based compensation	—		—	—		4,952		—	—		—		—		4,952
Forfeiture of restricted stock awards	—		(487)	—		46		487	(46)		—		—		—
Purchase of treasury stock	—		(14,810)	—		—		14,810	(1,316)		—		—		(1,316)
Dividends on preferred stock	—		—	—		—		—	—		(801)		—		(801)
Net income	—		—	—		—		—	—		24,329		—		24,329
Other comprehensive income (loss)	—		—	—		—		—	—		—		23		23
Balance, March 31, 2022	$	45,000	25,161,690	$	283	$	516,551	3,118,098	$	(106,105)	$	422,879	$	8,057	886,665
Issuance of restricted stock awards	—		—	—		—		—	—		—		—		—
Vesting of performance stock units	—		20,996	—		—		—	—		—		—		—
Stock option exercises, net	—		32	—		—		—	—		—		—		—
Stock based compensation	—		—	—		7,880		—	—		—		—		7,880
Forfeiture of restricted stock awards	—		(2,417)	—		205		2,417	(205)		—		—		—
Purchase of treasury stock	—		(722,524)	—		—		722,524	(50,614)		—		—		(50,614)
Dividends on preferred stock	—		—	—		—		—	—		(802)		—		(802)
Net income	—		—	—		—		—	—		44,192		—		44,192
Other comprehensive income (loss)	—		—	—		—		—	—		—		(13,040)

Triumph Bancorp, Inc. [TBK] Filings
Triumph Bancorp, Inc. [TBKCP] Filings
10-Q	[2022-07-20]
10-Q	[2022-04-20]
10-K	[2022-02-14]
10-Q	[2021-10-20]
10-Q	[2021-07-21]
10-Q	[2021-04-21]
10-K	[2021-02-12]
10-Q	[2020-10-20]
10-Q	[2020-08-07]
10-Q	[2020-04-21]
10-K	[2020-02-11]
10-Q	[2019-10-18]
10-Q	[2019-07-19]
10-Q	[2019-04-19]
10-K	[2019-02-12]
10-Q	[2018-10-19]
10-Q	[2018-07-20]
10-Q	[2018-04-20]
10-K	[2018-02-13]
10-Q	[2017-10-20]
10-Q	[2017-07-21]
10-Q	[2017-04-26]
10-K	[2017-02-17]
10-Q	[2016-10-28]
10-Q	[2016-08-03]
10-Q	[2016-05-04]
10-K	[2016-02-26]
10-Q	[2015-11-02]
10-Q	[2015-07-31]
10-Q	[2015-05-06]
10-K	[2015-03-06]
10-Q	[2014-12-17]
S-1	[2014-09-19]

Triumph Bancorp, Inc. [TBK] Filings

Triumph Bancorp, Inc. [TBKCP] Filings