Stellar Bancorp, Inc. (the “Company” or “Stellar”) (NYSE: STEL) today reported net income of $33.9 million, or diluted earnings per share of $0.63, for the third quarter of 2024 compared to net income of $29.8 million, or diluted earnings per share of $0.56, for the second quarter of 2024.
“We are pleased to announce our third quarter 2024 financial results that reflect our work as we mark the second anniversary of our transformational merger completed on October 1, 2022,” said Robert R. Franklin, Jr., Stellar’s Chief Executive Officer. “Since the merger, we have focused on building the foundation of Stellar Bank. Those efforts include constructing the scalable infrastructure to support an institution with more than $10 billion of assets while we have built a strong capital base, significantly increased our liquidity position and maintained a disciplined focus on credit. We have also significantly reduced our exposure to commercial real estate and invested in assets to help us grow a more balanced loan portfolio through additional commercial and industrial lending experience and leadership.”
“Stellar Bank is positioned for success as the economic and political environment becomes clearer. Although we can’t predict timing of interest rate changes, we feel comfortable with our revenue outlook. The election cycle will soon be complete and some of the elevated stress and uncertainty around the process will abate,” Mr. Franklin continued.
“Our markets remain resilient. We have positioned the Bank for quality growth and we look forward to furthering the Stellar brand in our markets,” concluded Mr. Franklin.
Third Quarter 2024 Financial Highlights
- Solid Profitability: Third quarter 2024 net income of $33.9 million, or diluted earnings per share of $0.63, translated into an annualized return on average assets of 1.27%, an annualized return on average equity of 8.49% and an annualized return on average tangible equity of 13.63%(1).
- Strong Net Interest Margin: Tax equivalent net interest margin was 4.19% for the third quarter of 2024 compared to 4.24% for the second quarter of 2024. The tax equivalent net interest margin, excluding purchase accounting accretion (“PAA”), was 3.91%(1) for the third quarter of 2024 compared to 3.82%(1) for the second quarter of 2024.
- Meaningful Capital and Book Value Build: Total risk-based capital ratio increased to 15.91% at September 30, 2024 from 15.34% at June 30, 2024, book value per share increased to $30.43 from $29.23 at June 30, 2024 and tangible book value per share increased to $19.28(1) from $18.00(1) at June 30, 2024.
- Improving Credit Metrics: Nonperforming loans decreased $18.8 million to $32.1 million at September 30, 2024 from $50.9 million at June 30, 2024. Allowance for credit losses on loans to nonperforming loans increased to 262.92% at September 30, 2024 from 186.17% at June 30, 2024.
Third Quarter 2024 Results
Net interest income in the third quarter of 2024 increased $97 thousand, or 0.1%, to $101.5 million from $101.4 million for the second quarter of 2024. The net interest margin on a tax equivalent basis decreased 5 basis points to 4.19% for the third quarter of 2024 from 4.24% for the second quarter of 2024. The decrease in the net interest margin from the prior quarter was primarily due to the impact of decreased interest rates on interest earning assets, partially offset by decreased rates on interest-bearing liabilities. Net interest income for the third quarter of 2024 benefited from $6.8 million of income from purchase accounting accretion compared to $10.1 million in the second quarter of 2024. Excluding purchase accounting accretion, net interest income (tax equivalent) for the third quarter of 2024 would have been $94.8 million(1) and the tax equivalent net interest margin would have been 3.91%(1).
Noninterest income for the third quarter of 2024 was $6.3 million, an increase of $886 thousand, or 16.4%, compared to $5.4 million for the second quarter of 2024. Noninterest income increased in the third quarter of 2024 compared to the second quarter of 2024 primarily due to an increase in gains on sales of assets and Small Business Investment Company income recognized in the third quarter of 2024 compared to the second quarter of 2024.
Noninterest expense for the third quarter of 2024 decreased $150 thousand, or 0.2%, to $71.1 million compared to $71.2 million for the second quarter of 2024. The decrease in noninterest expense in the third quarter of 2024 compared to the second quarter of 2024 was primarily due to a $2.0 million decrease in other noninterest expense and a $520 thousand decrease in regulatory assessments, partially offset by a $2.1 million increase in salaries and employee benefits.
The efficiency ratio was 66.18% for the third quarter of 2024 compared to 66.63% for the second quarter of 2024. Annualized returns on average assets, average equity and average tangible equity were 1.27%, 8.49% and 13.63%(1) for the third quarter of 2024, respectively, compared to 1.13%, 7.78% and 12.82%(1), respectively, for the second quarter of 2024.
| ___________________ |
(1) Refer to page 10 of this earnings release for the calculation of this non-GAAP financial measure. |
Financial Condition
Total assets at September 30, 2024 were $10.63 billion, a decrease of $93.9 million, compared to $10.72 billion at June 30, 2024.
Total loans at September 30, 2024 decreased $162.8 million to $7.55 billion compared to $7.71 billion at June 30, 2024. At September 30, 2024, the remaining balance of the purchase accounting accretion on loans was $81.4 million.
Total deposits at September 30, 2024 increased $17.3 million to $8.74 billion compared to $8.73 billion at June 30, 2024, due to increases in interest-bearing demand deposits and money market and savings deposits, partially offset by decreases in certificates and other time deposits and noninterest-bearing deposits. Shifts in the deposit mix were primarily driven by the current interest rate environment and an intensely competitive market for deposits.
During the third quarter 2024, the Company repurchased 108,984 shares at an average price per share of $26.10 under its share repurchase program.
Asset Quality
Nonperforming assets totaled $35.1 million, or 0.33% of total assets, at September 30, 2024, compared to $53.5 million, or 0.50% of total assets, at June 30, 2024. The allowance for credit losses on loans as a percentage of total loans was 1.12% at September 30, 2024 and 1.23% at June 30, 2024.
The third quarter of 2024 included a reversal of provision for credit losses of $6.0 million compared to a reversal of provision for credit losses of $1.9 million recorded during the second quarter of 2024. Net charge-offs for the third quarter of 2024 were $3.9 million, or 0.21% (annualized) of average loans, compared to net recoveries of $1 thousand, or 0.00% (annualized) of average loans, for the second quarter of 2024.
GAAP Reconciliation of Non-GAAP Financial Measures
Stellar’s management uses certain non-GAAP financial measures to evaluate its performance. Please refer to the GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures on page 10 of this earnings release for a reconciliation of these non-GAAP financial measures.
Conference Call
Stellar’s management team will host a conference call and webcast on Friday, October 25, 2024 at 8:00 a.m. Central Time (9:00 a.m. Eastern Time) to discuss its results for the second quarter of 2024. Participants may register for the conference call at https://registrations.events/direct/Q4I635867 to receive the dial-in numbers and unique PIN to access the call. If you need assistance in obtaining a dial-in number, please contact IR@stellar.bank. A simultaneous audio-only webcast may be accessed at https://events.q4inc.com/attendee/992487934. If you are unable to participate during the live webcast, the webcast will be accessible via the Investor Relations section of the Company’s website at ir.stellar.bank.
About Stellar Bancorp, Inc.
Stellar Bancorp, Inc. is a bank holding company headquartered in Houston, Texas. Stellar’s principal banking subsidiary, Stellar Bank, provides a diversified range of commercial banking services primarily to small- to medium-sized businesses and individual customers across the Houston, Dallas, Beaumont and surrounding communities in Texas.
Forward-Looking Statements
Certain statements in this press release which are not historical in nature are intended to be, and are hereby identified as, “forward-looking statements” for purposes of the safe harbor provided by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements about the benefits of the Company’s merger with Allegiance Bancshares, Inc. (the “Merger”), including future financial performance and operating results, the Company’s plans, business and growth strategies, objectives, expectations and intentions, and other statements that are not historical facts, including projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Forward-looking statements may be identified by terminology such as “may,” “will,” “should,” “could,” “scheduled,” “plans,” “intends,” “projects,” “anticipates,” “expects,” “believes,” “estimates,” “potential,” “would,” or “continue” or negatives of such terms or other comparable terminology.
All forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors that may cause the actual results, performance or achievements of Stellar to differ materially from any results expressed or implied by such forward-looking statements. Such factors include, among others: the risk that the cost savings and any revenue synergies from the Merger may not be fully realized or may take longer than anticipated to be realized; disruption to our business as a result of the Merger; the risk that the integration of operations will be materially delayed or will be more costly or difficult than we expected or that we are otherwise unable to successfully integrate our legacy businesses; the amount of the costs, fees, expenses and charges related to the Merger; reputational risk and the reaction of our customers, suppliers, employees or other business partners to the Merger; changes in the interest rate environment, the value of Stellar’s assets and obligations and the availability of capital and liquidity; general competitive, economic, political and market conditions; and other factors that may affect future results of Stellar including changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer borrowing, repayment, investment and deposit practices; the impact, extent and timing of technological changes; capital management activities; disruptions to the economy and the U.S. banking system caused by recent bank failures, risks associated with uninsured deposits and responsive measures by federal or state governments or banking regulators, including increases in the cost of our deposit insurance assessments and other actions of the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation and Texas Department of Banking and legislative and regulatory actions and reforms.
Additional factors which could affect the Company’s future results can be found in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, in each case filed with the SEC and available on the SEC’s website at https://www.sec.gov. We disclaim any obligation and do not intend to update or revise any forward-looking statements contained in this communication, which speak only as of the date hereof, whether as a result of new information, future events or otherwise, except as required by federal securities laws. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements.
Stellar Bancorp, Inc. |
|||||||||||||||||||
Financial Highlights |
|||||||||||||||||||
(Unaudited) |
|||||||||||||||||||
|
2024 |
|
|
2023 |
|||||||||||||||
|
September 30 |
|
June 30 |
|
March 31 |
|
December 31 |
|
September 30 |
||||||||||
|
(Dollars in thousands) |
||||||||||||||||||
ASSETS |
|
|
|
|
|
|
|
|
|
||||||||||
Cash and due from banks |
$ |
103,735 |
|
|
$ |
110,341 |
|
|
$ |
74,663 |
|
|
$ |
121,004 |
|
|
$ |
94,970 |
|
Interest-bearing deposits at other financial institutions |
|
412,482 |
|
|
|
379,909 |
|
|
|
325,079 |
|
|
|
278,233 |
|
|
|
207,302 |
|
Total cash and cash equivalents |
|
516,217 |
|
|
|
490,250 |
|
|
|
399,742 |
|
|
|
399,237 |
|
|
|
302,272 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Available for sale securities, at fair value |
|
1,691,752 |
|
|
|
1,630,971 |
|
|
|
1,523,100 |
|
|
|
1,395,680 |
|
|
|
1,414,952 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans held for investment |
|
7,551,124 |
|
|
|
7,713,897 |
|
|
|
7,908,111 |
|
|
|
7,925,133 |
|
|
|
8,004,528 |
|
Less: allowance for credit losses on loans |
|
(84,501 |
) |
|
|
(94,772 |
) |
|
|
(96,285 |
) |
|
|
(91,684 |
) |
|
|
(93,575 |
) |
Loans, net |
|
7,466,623 |
|
|
|
7,619,125 |
|
|
|
7,811,826 |
|
|
|
7,833,449 |
|
|
|
7,910,953 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accrued interest receivable |
|
39,473 |
|
|
|
43,348 |
|
|
|
45,466 |
|
|
|
44,244 |
|
|
|
43,536 |
|
Premises and equipment, net |
|
113,742 |
|
|
|
113,984 |
|
|
|
115,698 |
|
|
|
118,683 |
|
|
|
119,332 |
|
Federal Home Loan Bank stock |
|
20,123 |
|
|
|
15,089 |
|
|
|
16,050 |
|
|
|
25,051 |
|
|
|
29,022 |
|
Bank-owned life insurance |
|
106,876 |
|
|
|
106,262 |
|
|
|
105,671 |
|
|
|
105,084 |
|
|
|
104,699 |
|
Goodwill |
|
497,318 |
|
|
|
497,318 |
|
|
|
497,318 |
|
|
|
497,318 |
|
|
|
497,318 |
|
Core deposit intangibles, net |
|
98,116 |
|
|
|
104,315 |
|
|
|
110,513 |
|
|
|
116,712 |
|
|
|
122,944 |
|
Other assets |
|
79,537 |
|
|
|
103,001 |
|
|
|
103,838 |
|
|
|
111,681 |
|
|
|
120,432 |
|
Total assets |
$ |
10,629,777 |
|
|
$ |
10,723,663 |
|
|
$ |
10,729,222 |
|
|
$ |
10,647,139 |
|
|
$ |
10,665,460 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES: |
|
|
|
|
|
|
|
|
|
||||||||||
Deposits: |
|
|
|
|
|
|
|
|
|
||||||||||
Noninterest-bearing |
$ |
3,303,048 |
|
|
$ |
3,308,441 |
|
|
$ |
3,323,149 |
|
|
$ |
3,546,815 |
|
|
$ |
3,656,288 |
|
Interest-bearing |
|
|
|
|
|
|
|
|
|
||||||||||
Demand |
|
1,571,504 |
|
|
|
1,564,405 |
|
|
|
1,576,261 |
|
|
|
1,659,999 |
|
|
|
1,397,492 |
|
Money market and savings |
|
2,280,651 |
|
|
|
2,213,031 |
|
|
|
2,203,767 |
|
|
|
2,136,777 |
|
|
|
2,128,950 |
|
Certificates and other time |
|
1,587,398 |
|
|
|
1,639,426 |
|
|
|
1,691,539 |
|
|
|
1,529,876 |
|
|
|
1,503,891 |
|
Total interest-bearing deposits |
|
5,439,553 |
|
|
|
5,416,862 |
|
|
|
5,471,567 |
|
|
|
5,326,652 |
|
|
|
5,030,333 |
|
Total deposits |
|
8,742,601 |
|
|
|
8,725,303 |
|
|
|
8,794,716 |
|
|
|
8,873,467 |
|
|
|
8,686,621 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accrued interest payable |
|
16,915 |
|
|
|
12,327 |
|
|
|
12,227 |
|
|
|
11,288 |
|
|
|
7,612 |
|
Borrowed funds |
|
60,000 |
|
|
|
240,000 |
|
|
|
215,000 |
|
|
|
50,000 |
|
|
|
323,981 |
|
Subordinated debt |
|
110,064 |
|
|
|
109,964 |
|
|
|
109,864 |
|
|
|
109,765 |
|
|
|
109,665 |
|
Other liabilities |
|
74,074 |
|
|
|
70,274 |
|
|
|
66,717 |
|
|
|
81,601 |
|
|
|
76,735 |
|
Total liabilities |
|
9,003,654 |
|
|
|
9,157,868 |
|
|
|
9,198,524 |
|
|
|
9,126,121 |
|
|
|
9,204,614 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
SHAREHOLDERS’ EQUITY: |
|
|
|
|
|
|
|
|
|
||||||||||
Common stock |
|
535 |
|
|
|
536 |
|
|
|
536 |
|
|
|
533 |
|
|
|
533 |
|
Capital surplus |
|
1,238,619 |
|
|
|
1,238,477 |
|
|
|
1,235,221 |
|
|
|
1,232,627 |
|
|
|
1,231,686 |
|
Retained earnings |
|
474,905 |
|
|
|
447,948 |
|
|
|
425,130 |
|
|
|
405,945 |
|
|
|
385,600 |
|
Accumulated other comprehensive loss |
|
(87,936 |
) |
|
|
(121,166 |
) |
|
|
(130,189 |
) |
|
|
(118,087 |
) |
|
|
(156,973 |
) |
Total shareholders’ equity |
|
1,626,123 |
|
|
|
1,565,795 |
|
|
|
1,530,698 |
|
|
|
1,521,018 |
|
|
|
1,460,846 |
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
$ |
10,629,777 |
|
|
$ |
10,723,663 |
|
|
$ |
10,729,222 |
|
|
$ |
10,647,139 |
|
|
$ |
10,665,460 |
|
Stellar Bancorp, Inc. |
|||||||||||||||||||||||
Financial Highlights |
|||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||||||||
|
September 30 |
|
June 30 |
|
March 31 |
|
December 31 |
|
September 30 |
|
September 30 |
|
September 30 |
||||||||||
|
|
||||||||||||||||||||||
INTEREST INCOME: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans, including fees |
$ |
132,372 |
|
|
$ |
135,885 |
|
|
$ |
134,685 |
|
$ |
139,114 |
|
$ |
138,948 |
|
$ |
402,942 |
|
|
$ |
398,608 |
Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Taxable |
|
13,898 |
|
|
|
11,923 |
|
|
|
9,293 |
|
|
9,622 |
|
|
9,493 |
|
|
35,114 |
|
|
|
28,872 |
Tax-exempt |
|
814 |
|
|
|
816 |
|
|
|
818 |
|
|
418 |
|
|
437 |
|
|
2,448 |
|
|
|
2,135 |
Deposits in other financial institutions |
|
4,692 |
|
|
|
3,555 |
|
|
|
3,627 |
|
|
3,021 |
|
|
2,391 |
|
|
11,874 |
|
|
|
9,027 |
Total interest income |
|
151,776 |
|
|
|
152,179 |
|
|
|
148,423 |
|
|
152,175 |
|
|
151,269 |
|
|
452,378 |
|
|
|
438,642 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INTEREST EXPENSE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Demand, money market and savings deposits |
|
29,440 |
|
|
|
28,399 |
|
|
|
27,530 |
|
|
25,033 |
|
|
23,557 |
|
|
85,369 |
|
|
|
62,302 |
Certificates and other time deposits |
|
18,073 |
|
|
|
18,758 |
|
|
|
15,084 |
|
|
15,075 |
|
|
13,282 |
|
|
51,915 |
|
|
|
26,211 |
Borrowed funds |
|
840 |
|
|
|
1,700 |
|
|
|
1,774 |
|
|
4,154 |
|
|
5,801 |
|
|
4,314 |
|
|
|
13,653 |
Subordinated debt |
|
1,916 |
|
|
|
1,912 |
|
|
|
1,917 |
|
|
1,983 |
|
|
1,908 |
|
|
5,745 |
|
|
|
5,647 |
Total interest expense |
|
50,269 |
|
|
|
50,769 |
|
|
|
46,305 |
|
|
46,245 |
|
|
44,548 |
|
|
147,343 |
|
|
|
107,813 |
NET INTEREST INCOME |
|
101,507 |
|
|
|
101,410 |
|
|
|
102,118 |
|
|
105,930 |
|
|
106,721 |
|
|
305,035 |
|
|
|
330,829 |
(Reversal of) provision for credit losses |
|
(5,985 |
) |
|
|
(1,935 |
) |
|
|
4,098 |
|
|
1,047 |
|
|
2,315 |
|
|
(3,822 |
) |
|
|
7,896 |
Net interest income after provision for credit losses |
|
107,492 |
|
|
|
103,345 |
|
|
|
98,020 |
|
|
104,883 |
|
|
104,406 |
|
|
308,857 |
|
|
|
322,933 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NONINTEREST INCOME: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Service charges on deposit accounts |
|
1,594 |
|
|
|
1,648 |
|
|
|
1,598 |
|
|
1,520 |
|
|
1,620 |
|
|
4,840 |
|
|
|
4,544 |
Gain (loss) on sale of assets |
|
432 |
|
|
|
(64 |
) |
|
|
513 |
|
|
198 |
|
|
— |
|
|
881 |
|
|
|
192 |
Bank-owned life insurance |
|
614 |
|
|
|
591 |
|
|
|
587 |
|
|
573 |
|
|
551 |
|
|
1,792 |
|
|
|
1,605 |
Debit card and ATM income |
|
551 |
|
|
|
543 |
|
|
|
527 |
|
|
542 |
|
|
935 |
|
|
1,621 |
|
|
|
4,454 |
Other |
|
3,111 |
|
|
|
2,698 |
|
|
|
3,071 |
|
|
4,053 |
|
|
1,589 |
|
|
8,880 |
|
|
|
6,881 |
Total noninterest income |
|
6,302 |
|
|
|
5,416 |
|
|
|
6,296 |
|
|
6,886 |
|
|
4,695 |
|
|
18,014 |
|
|
|
17,676 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NONINTEREST EXPENSE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Salaries and employee benefits |
|
41,123 |
|
|
|
39,061 |
|
|
|
41,376 |
|
|
40,464 |
|
|
39,495 |
|
|
121,560 |
|
|
|
116,570 |
Net occupancy and equipment |
|
4,570 |
|
|
|
4,503 |
|
|
|
4,390 |
|
|
4,572 |
|
|
4,455 |
|
|
13,463 |
|
|
|
12,360 |
Depreciation |
|
1,911 |
|
|
|
1,948 |
|
|
|
1,964 |
|
|
1,955 |
|
|
1,952 |
|
|
5,823 |
|
|
|
5,629 |
Data processing and software amortization |
|
5,706 |
|
|
|
5,501 |
|
|
|
4,894 |
|
|
5,000 |
|
|
4,798 |
|
|
16,101 |
|
|
|
14,526 |
Professional fees |
|
1,714 |
|
|
|
1,620 |
|
|
|
2,662 |
|
|
3,867 |
|
|
997 |
|
|
5,996 |
|
|
|
4,088 |
Regulatory assessments and FDIC insurance |
|
1,779 |
|
|
|
2,299 |
|
|
|
1,854 |
|
|
5,169 |
|
|
1,814 |
|
|
5,932 |
|
|
|
5,863 |
Amortization of intangibles |
|
6,212 |
|
|
|
6,215 |
|
|
|
6,212 |
|
|
6,247 |
|
|
6,876 |
|
|
18,639 |
|
|
|
20,636 |
Communications |
|
827 |
|
|
|
847 |
|
|
|
937 |
|
|
743 |
|
|
663 |
|
|
2,611 |
|
|
|
2,053 |
Advertising |
|
878 |
|
|
|
891 |
|
|
|
765 |
|
|
1,004 |
|
|
877 |
|
|
2,534 |
|
|
|
2,623 |
Acquisition and merger-related expenses |
|
— |
|
|
|
— |
|
|
|
— |
|
|
3,072 |
|
|
3,421 |
|
|
— |
|
|
|
12,483 |
Other |
|
6,346 |
|
|
|
8,331 |
|
|
|
6,356 |
|
|
5,848 |
|
|
5,400 |
|
|
21,033 |
|
|
|
15,722 |
Total noninterest expense |
|
71,066 |
|
|
|
71,216 |
|
|
|
71,410 |
|
|
77,941 |
|
|
70,748 |
|
|
213,692 |
|
|
|
212,553 |
INCOME BEFORE INCOME TAXES |
|
42,728 |
|
|
|
37,545 |
|
|
|
32,906 |
|
|
33,828 |
|
|
38,353 |
|
|
113,179 |
|
|
|
128,056 |
Provision for income taxes |
|
8,837 |
|
|
|
7,792 |
|
|
|
6,759 |
|
|
6,562 |
|
|
7,445 |
|
|
23,388 |
|
|
|
24,825 |
NET INCOME |
$ |
33,891 |
|
|
$ |
29,753 |
|
|
$ |
26,147 |
|
$ |
27,266 |
|
$ |
30,908 |
|
$ |
89,791 |
|
|
$ |
103,231 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
EARNINGS PER SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic |
$ |
0.63 |
|
|
$ |
0.56 |
|
|
$ |
0.49 |
|
$ |
0.51 |
|
$ |
0.58 |
|
$ |
1.68 |
|
|
$ |
1.94 |
Diluted |
$ |
0.63 |
|
|
$ |
0.56 |
|
|
$ |
0.49 |
|
$ |
0.51 |
|
$ |
0.58 |
|
$ |
1.68 |
|
|
$ |
1.94 |
Stellar Bancorp, Inc. |
|||||||||||||||||||||||||||
Financial Highlights |
|||||||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||||||||||||
|
September 30 |
|
June 30 |
|
March 31 |
|
December 31 |
|
September 30 |
|
September 30 |
|
September 30 |
||||||||||||||
|
(Dollars and share amounts in thousands, except per share data) |
||||||||||||||||||||||||||
Net income |
$ |
33,891 |
|
|
$ |
29,753 |
|
|
$ |
26,147 |
|
|
$ |
27,266 |
|
|
$ |
30,908 |
|
|
$ |
89,791 |
|
|
$ |
103,231 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Earnings per share, basic |
$ |
0.63 |
|
|
$ |
0.56 |
|
|
$ |
0.49 |
|
|
$ |
0.51 |
|
|
$ |
0.58 |
|
|
$ |
1.68 |
|
|
$ |
1.94 |
|
Earnings per share, diluted |
$ |
0.63 |
|
|
$ |
0.56 |
|
|
$ |
0.49 |
|
|
$ |
0.51 |
|
|
$ |
0.58 |
|
|
$ |
1.68 |
|
|
$ |
1.94 |
|
Dividends per share |
$ |
0.13 |
|
|
$ |
0.13 |
|
|
$ |
0.13 |
|
|
$ |
0.13 |
|
|
$ |
0.13 |
|
|
$ |
0.39 |
|
|
$ |
0.39 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Return on average assets(A) |
|
1.27 |
% |
|
|
1.13 |
% |
|
|
0.98 |
% |
|
|
1.02 |
% |
|
|
1.14 |
% |
|
|
1.13 |
% |
|
|
1.28 |
% |
Return on average equity(A) |
|
8.49 |
% |
|
|
7.78 |
% |
|
|
6.88 |
% |
|
|
7.33 |
% |
|
|
8.34 |
% |
|
|
7.73 |
% |
|
|
9.52 |
% |
Return on average tangible equity(A)(B) |
|
13.63 |
% |
|
|
12.82 |
% |
|
|
11.47 |
% |
|
|
12.61 |
% |
|
|
14.47 |
% |
|
|
12.67 |
% |
|
|
16.86 |
% |
Net interest margin (tax equivalent)(A)(C) |
|
4.19 |
% |
|
|
4.24 |
% |
|
|
4.26 |
% |
|
|
4.40 |
% |
|
|
4.37 |
% |
|
|
4.23 |
% |
|
|
4.55 |
% |
Net interest margin (tax equivalent) excluding PAA(A)(B)(C) |
|
3.91 |
% |
|
|
3.82 |
% |
|
|
3.91 |
% |
|
|
3.91 |
% |
|
|
3.87 |
% |
|
|
3.88 |
% |
|
|
4.07 |
% |
Efficiency ratio(D) |
|
66.18 |
% |
|
|
66.63 |
% |
|
|
66.18 |
% |
|
|
69.21 |
% |
|
|
63.50 |
% |
|
|
66.33 |
% |
|
|
61.02 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Capital Ratios |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Stellar Bancorp, Inc. (Consolidated) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Equity to assets |
|
15.30 |
% |
|
|
14.60 |
% |
|
|
14.27 |
% |
|
|
14.29 |
% |
|
|
13.70 |
% |
|
|
15.30 |
% |
|
|
13.70 |
% |
Tangible equity to tangible assets(B) |
|
10.27 |
% |
|
|
9.53 |
% |
|
|
9.12 |
% |
|
|
9.04 |
% |
|
|
8.37 |
% |
|
|
10.27 |
% |
|
|
8.37 |
% |
Estimated Total capital ratio (to risk-weighted assets) |
|
15.91 |
% |
|
|
15.34 |
% |
|
|
14.62 |
% |
|
|
14.02 |
% |
|
|
13.61 |
% |
|
|
15.91 |
% |
|
|
13.61 |
% |
Estimated Common equity Tier 1 capital (to risk weighted assets) |
|
13.62 |
% |
|
|
12.98 |
% |
|
|
12.29 |
% |
|
|
11.77 |
% |
|
|
11.30 |
% |
|
|
13.62 |
% |
|
|
11.30 |
% |
Estimated Tier 1 capital (to risk-weighted assets) |
|
13.74 |
% |
|
|
13.10 |
% |
|
|
12.41 |
% |
|
|
11.89 |
% |
|
|
11.41 |
% |
|
|
13.74 |
% |
|
|
11.41 |
% |
Estimated Tier 1 leverage (to average tangible assets) |
|
11.25 |
% |
|
|
10.93 |
% |
|
|
10.55 |
% |
|
|
10.18 |
% |
|
|
9.82 |
% |
|
|
11.25 |
% |
|
|
9.82 |
% |
Stellar Bank |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Estimated Total capital ratio (to risk-weighted assets) |
|
15.07 |
% |
|
|
14.65 |
% |
|
|
14.13 |
% |
|
|
13.65 |
% |
|
|
13.32 |
% |
|
|
15.07 |
% |
|
|
13.32 |
% |
Estimated Common equity Tier 1 capital (to risk-weighted assets) |
|
13.63 |
% |
|
|
13.12 |
% |
|
|
12.61 |
% |
|
|
12.20 |
% |
|
|
11.80 |
% |
|
|
13.63 |
% |
|
|
11.80 |
% |
Estimated Tier 1 capital (to risk-weighted assets) |
|
13.63 |
% |
|
|
13.12 |
% |
|
|
12.61 |
% |
|
|
12.20 |
% |
|
|
11.80 |
% |
|
|
13.63 |
% |
|
|
11.80 |
% |
Estimated Tier 1 leverage (to average tangible assets) |
|
11.16 |
% |
|
|
10.94 |
% |
|
|
10.72 |
% |
|
|
10.44 |
% |
|
|
10.15 |
% |
|
|
11.16 |
% |
|
|
10.15 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Other Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Weighted average shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic |
|
53,541 |
|
|
|
53,572 |
|
|
|
53,343 |
|
|
|
53,282 |
|
|
|
53,313 |
|
|
|
53,485 |
|
|
|
53,211 |
|
Diluted |
53,580 |
53,608 |
53,406 |
53,350 |
53,380 |
53,531 |
53,300 |
||||||||||||||||||||
Period end shares outstanding |
|
53,446 |
|
|
|
53,564 |
|
|
|
53,551 |
|
|
|
53,291 |
|
|
|
53,322 |
|
|
|
53,446 |
|
|
|
53,322 |
|
Book value per share |
$ |
30.43 |
|
|
$ |
29.23 |
|
|
$ |
28.58 |
|
|
$ |
28.54 |
|
|
$ |
27.40 |
|
|
$ |
30.43 |
|
|
$ |
27.40 |
|
Tangible book value per share(B) |
$ |
19.28 |
|
|
$ |
18.00 |
|
|
$ |
17.23 |
|
|
$ |
17.02 |
|
|
$ |
15.76 |
|
|
$ |
19.28 |
|
|
$ |
15.76 |
|
Employees - full-time equivalents |
|
1,040 |
|
|
|
1,045 |
|
|
|
1,007 |
|
|
|
998 |
|
|
|
1,008 |
|
|
|
1,040 |
|
|
|
1,008 |
|
(A) |
Interim periods annualized. |
(B) |
Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on page 10 of this Earnings Release. |
(C) |
Net interest margin represents net interest income divided by average interest-earning assets. |
(D) |
Represents total noninterest expense divided by the sum of net interest income plus noninterest income, excluding net gains and losses on the sale of loans, securities and assets. Additionally, taxes and provision for credit losses are not part of this calculation. |
Stellar Bancorp, Inc. |
|||||||||||||||||||||||||||||
Financial Highlights |
|||||||||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||||||||
Three Months Ended |
|||||||||||||||||||||||||||||
|
September 30, 2024 |
|
June 30, 2024 |
|
September 30, 2023 |
||||||||||||||||||||||||
|
Average
|
|
Interest
|
|
Average
|
|
Average
|
|
Interest
|
|
Average
|
|
Average
|
|
Interest
|
|
Average
|
||||||||||||
|
(Dollars in thousands) |
||||||||||||||||||||||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest-Earning Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loans |
$ |
7,627,522 |
|
|
$ |
132,372 |
|
6.90 |
% |
|
$ |
7,808,320 |
|
|
$ |
135,885 |
|
7.00 |
% |
|
$ |
8,043,706 |
|
|
$ |
138,948 |
|
6.85 |
% |
Securities |
|
1,676,614 |
|
|
|
14,712 |
|
3.49 |
% |
|
|
1,549,638 |
|
|
|
12,739 |
|
3.31 |
% |
|
|
1,471,916 |
|
|
|
9,930 |
|
2.68 |
% |
Deposits in other financial institutions |
|
339,493 |
|
|
|
4,692 |
|
5.50 |
% |
|
|
258,916 |
|
|
|
3,555 |
|
5.52 |
% |
|
|
181,931 |
|
|
|
2,391 |
|
5.21 |
% |
Total interest-earning assets |
|
9,643,629 |
|
|
$ |
151,776 |
|
6.26 |
% |
|
|
9,616,874 |
|
|
$ |
152,179 |
|
6.36 |
% |
|
|
9,697,553 |
|
|
$ |
151,269 |
|
6.19 |
% |
Allowance for credit losses on loans |
|
(94,785 |
) |
|
|
|
|
|
|
(96,306 |
) |
|
|
|
|
|
|
(99,892 |
) |
|
|
|
|
||||||
Noninterest-earning assets |
|
1,077,422 |
|
|
|
|
|
|
|
1,103,297 |
|
|
|
|
|
|
|
1,143,634 |
|
|
|
|
|
||||||
Total assets |
$ |
10,626,266 |
|
|
|
|
|
|
$ |
10,623,865 |
|
|
|
|
|
|
$ |
10,741,295 |
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest-Bearing Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest-bearing demand deposits |
$ |
1,606,736 |
|
|
$ |
12,458 |
|
3.08 |
% |
|
$ |
1,545,096 |
|
|
$ |
12,213 |
|
3.18 |
% |
|
$ |
1,400,508 |
|
|
$ |
10,415 |
|
2.95 |
% |
Money market and savings deposits |
|
2,254,767 |
|
|
|
16,982 |
|
3.00 |
% |
|
|
2,227,393 |
|
|
|
16,186 |
|
2.92 |
% |
|
|
2,166,610 |
|
|
|
13,142 |
|
2.41 |
% |
Certificates and other time deposits |
|
1,620,908 |
|
|
|
18,073 |
|
4.44 |
% |
|
|
1,694,536 |
|
|
|
18,758 |
|
4.45 |
% |
|
|
1,400,367 |
|
|
|
13,282 |
|
3.76 |
% |
Borrowed funds |
|
49,077 |
|
|
|
840 |
|
6.81 |
% |
|
|
112,187 |
|
|
|
1,700 |
|
6.09 |
% |
|
|
411,212 |
|
|
|
5,801 |
|
5.60 |
% |
Subordinated debt |
|
110,007 |
|
|
|
1,916 |
|
6.93 |
% |
|
|
109,910 |
|
|
|
1,912 |
|
7.00 |
% |
|
|
109,608 |
|
|
|
1,908 |
|
6.91 |
% |
Total interest-bearing liabilities |
|
5,641,495 |
|
|
$ |
50,269 |
|
3.54 |
% |
|
|
5,689,122 |
|
|
$ |
50,769 |
|
3.59 |
% |
|
|
5,488,305 |
|
|
$ |
44,548 |
|
3.22 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Noninterest-Bearing Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Noninterest-bearing demand deposits |
|
3,303,726 |
|
|
|
|
|
|
|
3,308,633 |
|
|
|
|
|
|
|
3,695,592 |
|
|
|
|
|
||||||
Other liabilities |
|
93,127 |
|
|
|
|
|
|
|
87,986 |
|
|
|
|
|
|
|
86,389 |
|
|
|
|
|
||||||
Total liabilities |
|
9,038,348 |
|
|
|
|
|
|
|
9,085,741 |
|
|
|
|
|
|
|
9,270,286 |
|
|
|
|
|
||||||
Shareholders’ equity |
|
1,587,918 |
|
|
|
|
|
|
|
1,538,124 |
|
|
|
|
|
|
|
1,471,009 |
|
|
|
|
|
||||||
Total liabilities and shareholders’ equity |
$ |
10,626,266 |
|
|
|
|
|
|
$ |
10,623,865 |
|
|
|
|
|
|
$ |
10,741,295 |
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net interest rate spread |
|
|
|
|
2.72 |
% |
|
|
|
|
|
2.77 |
% |
|
|
|
|
|
2.97 |
% |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net interest income and margin |
|
|
$ |
101,507 |
|
4.19 |
% |
|
|
|
$ |
101,410 |
|
4.24 |
% |
|
|
|
$ |
106,721 |
|
4.37 |
% |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net interest income and net interest margin (tax equivalent) |
|
|
$ |
101,578 |
|
4.19 |
% |
|
|
|
$ |
101,482 |
|
4.24 |
% |
|
|
|
$ |
106,919 |
|
4.37 |
% |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of funds |
|
|
|
|
2.24 |
% |
|
|
|
|
|
2.27 |
% |
|
|
|
|
|
1.92 |
% |
|||||||||
Cost of deposits |
|
|
|
|
2.15 |
% |
|
|
|
|
|
2.16 |
% |
|
|
|
|
|
1.69 |
% |
|||||||||
Stellar Bancorp, Inc. |
|||||||||||||||||||
Financial Highlights |
|||||||||||||||||||
(Unaudited) |
|||||||||||||||||||
|
Nine Months Ended September 30, |
||||||||||||||||||
|
2024 |
|
2023 |
||||||||||||||||
|
Average
|
|
Interest
|
|
Average
|
|
Average
|
|
Interest
|
|
Average
|
||||||||
|
(Dollars in thousands) |
||||||||||||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest-Earning Assets: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Loans |
$ |
7,790,957 |
|
|
$ |
402,942 |
|
6.91 |
% |
|
$ |
7,957,911 |
|
|
$ |
398,608 |
|
6.70 |
% |
Securities |
|
1,556,462 |
|
|
|
37,562 |
|
3.22 |
% |
|
|
1,525,808 |
|
|
|
31,007 |
|
2.72 |
% |
Deposits in other financial institutions |
|
287,960 |
|
|
|
11,874 |
|
5.51 |
% |
|
|
251,475 |
|
|
|
9,027 |
|
4.80 |
% |
Total interest-earning assets |
|
9,635,379 |
|
|
$ |
452,378 |
|
6.27 |
% |
|
|
9,735,194 |
|
|
$ |
438,642 |
|
6.02 |
% |
Allowance for credit losses on loans |
|
(94,236 |
) |
|
|
|
|
|
|
(96,570 |
) |
|
|
|
|
||||
Noninterest-earning assets |
|
1,104,426 |
|
|
|
|
|
|
|
1,148,847 |
|
|
|
|
|
||||
Total assets |
$ |
10,645,569 |
|
|
|
|
|
|
$ |
10,787,471 |
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities and Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest-Bearing Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest-bearing demand deposits |
$ |
1,616,313 |
|
|
$ |
36,949 |
|
3.05 |
% |
|
$ |
1,478,547 |
|
|
$ |
28,141 |
|
2.54 |
% |
Money market and savings deposits |
|
2,211,148 |
|
|
|
48,420 |
|
2.93 |
% |
|
|
2,291,588 |
|
|
|
34,161 |
|
1.99 |
% |
Certificates and other time deposits |
|
1,586,623 |
|
|
|
51,915 |
|
4.37 |
% |
|
|
1,164,572 |
|
|
|
26,211 |
|
3.01 |
% |
Borrowed funds |
|
98,374 |
|
|
|
4,314 |
|
5.86 |
% |
|
|
333,220 |
|
|
|
13,653 |
|
5.48 |
% |
Subordinated debt |
|
109,909 |
|
|
|
5,745 |
|
6.98 |
% |
|
|
109,508 |
|
|
|
5,647 |
|
6.89 |
% |
Total interest-bearing liabilities |
|
5,622,367 |
|
|
$ |
147,343 |
|
3.50 |
% |
|
|
5,377,435 |
|
|
$ |
107,813 |
|
2.68 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Noninterest-Bearing Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Noninterest-bearing demand deposits |
|
3,379,096 |
|
|
|
|
|
|
|
3,878,760 |
|
|
|
|
|
||||
Other liabilities |
|
92,527 |
|
|
|
|
|
|
|
81,894 |
|
|
|
|
|
||||
Total liabilities |
|
9,093,990 |
|
|
|
|
|
|
|
9,338,089 |
|
|
|
|
|
||||
Shareholders’ equity |
|
1,551,579 |
|
|
|
|
|
|
|
1,449,382 |
|
|
|
|
|
||||
Total liabilities and shareholders' equity |
$ |
10,645,569 |
|
|
|
|
|
|
$ |
10,787,471 |
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net interest rate spread |
|
|
|
|
2.77 |
% |
|
|
|
|
|
3.34 |
% |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net interest income and margin |
|
|
$ |
305,035 |
|
4.23 |
% |
|
|
|
$ |
330,829 |
|
4.54 |
% |
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net interest income and net interest margin (tax equivalent) |
|
|
$ |
305,266 |
|
4.23 |
% |
|
|
|
$ |
331,549 |
|
4.55 |
% |
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of funds |
|
|
|
|
2.19 |
% |
|
|
|
|
|
1.56 |
% |
||||||
Cost of deposits |
|
|
|
|
2.09 |
% |
|
|
|
|
|
1.34 |
% |
||||||
Stellar Bancorp, Inc. |
|||||||||||||||||||
Financial Highlights |
|||||||||||||||||||
(Unaudited) |
|||||||||||||||||||
|
Three Months Ended |
||||||||||||||||||
|
2024 |
|
2023 |
||||||||||||||||
|
September 30 |
|
June 30 |
|
March 31 |
|
December 31 |
|
September 30 |
||||||||||
|
(Dollars in thousands) |
||||||||||||||||||
Period-end Loan Portfolio: |
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial |
$ |
1,347,876 |
|
|
$ |
1,392,435 |
|
|
$ |
1,451,462 |
|
|
$ |
1,409,002 |
|
|
$ |
1,474,600 |
|
Paycheck Protection Program (PPP) |
|
2,877 |
|
|
|
3,629 |
|
|
|
4,293 |
|
|
|
5,100 |
|
|
|
5,968 |
|
Real estate: |
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate (including multi-family residential) |
|
3,976,296 |
|
|
|
4,029,671 |
|
|
|
4,049,885 |
|
|
|
4,071,807 |
|
|
|
4,076,606 |
|
Commercial real estate construction and land development |
|
890,316 |
|
|
|
922,805 |
|
|
|
1,039,443 |
|
|
|
1,060,406 |
|
|
|
1,078,265 |
|
1-4 family residential (including home equity) |
|
1,112,235 |
|
|
|
1,098,681 |
|
|
|
1,049,316 |
|
|
|
1,047,174 |
|
|
|
1,024,945 |
|
Residential construction |
|
161,494 |
|
|
|
200,134 |
|
|
|
252,573 |
|
|
|
267,357 |
|
|
|
289,553 |
|
Consumer and other |
|
60,030 |
|
|
|
66,542 |
|
|
|
61,139 |
|
|
|
64,287 |
|
|
|
54,591 |
|
Total loans held for investment |
$ |
7,551,124 |
|
|
$ |
7,713,897 |
|
|
$ |
7,908,111 |
|
|
$ |
7,925,133 |
|
|
$ |
8,004,528 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits: |
|
|
|
|
|
|
|
|
|
||||||||||
Noninterest-bearing |
$ |
3,303,048 |
|
|
$ |
3,308,441 |
|
|
$ |
3,323,149 |
|
|
$ |
3,546,815 |
|
|
$ |
3,656,288 |
|
Interest-bearing |
|
|
|
|
|
|
|
|
|
||||||||||
Demand |
|
1,571,504 |
|
|
|
1,564,405 |
|
|
|
1,576,261 |
|
|
|
1,659,999 |
|
|
|
1,397,492 |
|
Money market and savings |
|
2,280,651 |
|
|
|
2,213,031 |
|
|
|
2,203,767 |
|
|
|
2,136,777 |
|
|
|
2,128,950 |
|
Certificates and other time |
|
1,587,398 |
|
|
|
1,639,426 |
|
|
|
1,691,539 |
|
|
|
1,529,876 |
|
|
|
1,503,891 |
|
Total interest-bearing deposits |
|
5,439,553 |
|
|
|
5,416,862 |
|
|
|
5,471,567 |
|
|
|
5,326,652 |
|
|
|
5,030,333 |
|
Total deposits |
$ |
8,742,601 |
|
|
$ |
8,725,303 |
|
|
$ |
8,794,716 |
|
|
$ |
8,873,467 |
|
|
$ |
8,686,621 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Asset Quality: |
|
|
|
|
|
|
|
|
|
||||||||||
Nonaccrual loans |
$ |
32,140 |
|
|
$ |
50,906 |
|
|
$ |
57,129 |
|
|
$ |
39,191 |
|
|
$ |
38,291 |
|
Accruing loans 90 or more days past due |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total nonperforming loans |
|
32,140 |
|
|
|
50,906 |
|
|
|
57,129 |
|
|
|
39,191 |
|
|
|
38,291 |
|
Other real estate |
|
2,984 |
|
|
|
2,548 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total nonperforming assets |
$ |
35,124 |
|
|
$ |
53,454 |
|
|
$ |
57,129 |
|
|
$ |
39,191 |
|
|
$ |
38,291 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net charge-offs (recoveries) |
$ |
3,933 |
|
|
$ |
(1 |
) |
|
$ |
714 |
|
|
$ |
2,577 |
|
|
$ |
8,116 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Nonaccrual loans: |
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial |
$ |
9,718 |
|
|
$ |
18,451 |
|
|
$ |
15,465 |
|
|
$ |
5,048 |
|
|
$ |
14,991 |
|
Real estate: |
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate (including multi-family residential) |
|
10,695 |
|
|
|
18,094 |
|
|
|
21,268 |
|
|
|
16,699 |
|
|
|
13,563 |
|
Commercial real estate construction and land development |
|
4,183 |
|
|
|
1,641 |
|
|
|
8,406 |
|
|
|
5,043 |
|
|
|
170 |
|
1-4 family residential (including home equity) |
|
7,259 |
|
|
|
12,454 |
|
|
|
10,368 |
|
|
|
8,874 |
|
|
|
8,442 |
|
Residential construction |
|
121 |
|
|
|
155 |
|
|
|
1,410 |
|
|
|
3,288 |
|
|
|
635 |
|
Consumer and other |
|
164 |
|
|
|
111 |
|
|
|
212 |
|
|
|
239 |
|
|
|
490 |
|
Total nonaccrual loans |
$ |
32,140 |
|
|
$ |
50,906 |
|
|
$ |
57,129 |
|
|
$ |
39,191 |
|
|
$ |
38,291 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Asset Quality Ratios: |
|
|
|
|
|
|
|
|
|
||||||||||
Nonperforming assets to total assets |
|
0.33 |
% |
|
|
0.50 |
% |
|
|
0.53 |
% |
|
|
0.37 |
% |
|
|
0.36 |
% |
Nonperforming loans to total loans |
|
0.43 |
% |
|
|
0.66 |
% |
|
|
0.72 |
% |
|
|
0.49 |
% |
|
|
0.48 |
% |
Allowance for credit losses on loans to nonperforming loans |
|
262.92 |
% |
|
|
186.17 |
% |
|
|
168.54 |
% |
|
|
233.94 |
% |
|
|
244.38 |
% |
Allowance for credit losses on loans to total loans |
|
1.12 |
% |
|
|
1.23 |
% |
|
|
1.22 |
% |
|
|
1.16 |
% |
|
|
1.17 |
% |
Net charge-offs to average loans (annualized) |
|
0.21 |
% |
|
|
0.00 |
% |
|
|
0.04 |
% |
|
|
0.13 |
% |
|
|
0.40 |
% |
Stellar Bancorp, Inc.
GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures
(Unaudited)
Stellar’s management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Stellar believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and that management and investors benefit from referring to these non-GAAP financial measures in assessing Stellar’s performance and when planning, forecasting, analyzing and comparing past, present and future periods. Specifically, Stellar reviews pre-tax, pre-provision income, pre-tax pre-provision ROAA, tangible book value per share, return on average tangible equity, tangible equity to tangible assets and net interest margin (tax equivalent) excluding PAA for internal planning and forecasting purposes. Stellar has included in this earnings release information relating to these non-GAAP financial measures for the applicable periods presented. These non-GAAP measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which Stellar calculates the non-GAAP financial measures may differ from that of other companies reporting measures with similar names.
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||||||||||||
|
September 30 |
|
June 30 |
|
March 31 |
|
December 31 |
|
September 30 |
|
September 30 |
|
September 30 |
||||||||||||||
|
(Dollars and share amounts in thousands, except per share data) |
||||||||||||||||||||||||||
Net income |
$ |
33,891 |
|
|
$ |
29,753 |
|
|
$ |
26,147 |
|
|
$ |
27,266 |
|
|
$ |
30,908 |
|
|
$ |
89,791 |
|
|
$ |
103,231 |
|
Add: Provision for credit losses |
|
(5,985 |
) |
|
|
(1,935 |
) |
|
|
4,098 |
|
|
|
1,047 |
|
|
|
2,315 |
|
|
|
(3,822 |
) |
|
|
7,896 |
|
Add: Provision for income taxes |
|
8,837 |
|
|
|
7,792 |
|
|
|
6,759 |
|
|
|
6,562 |
|
|
|
7,445 |
|
|
|
23,388 |
|
|
|
24,825 |
|
Pre-tax, pre-provision income |
$ |
36,743 |
|
|
$ |
35,610 |
|
|
$ |
37,004 |
|
|
$ |
34,875 |
|
|
$ |
40,668 |
|
|
$ |
109,357 |
|
|
$ |
135,952 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total average assets |
$ |
10,626,266 |
|
|
$ |
10,623,865 |
|
|
$ |
10,686,789 |
|
|
$ |
10,626,373 |
|
|
$ |
10,741,295 |
|
|
$ |
10,645,569 |
|
|
$ |
10,787,471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Pre-tax, pre-provision return on average assets(B) |
|
1.38 |
% |
|
|
1.35 |
% |
|
|
1.39 |
% |
|
|
1.30 |
% |
|
|
1.50 |
% |
|
|
1.37 |
% |
|
|
1.68 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total shareholders’ equity |
$ |
1,626,123 |
|
|
$ |
1,565,795 |
|
|
$ |
1,530,698 |
|
|
$ |
1,521,018 |
|
|
$ |
1,460,846 |
|
|
$ |
1,626,123 |
|
|
$ |
1,460,846 |
|
Less: Goodwill and core deposit intangibles, net |
|
595,434 |
|
|
|
601,633 |
|
|
|
607,831 |
|
|
|
614,030 |
|
|
|
620,262 |
|
|
|
595,434 |
|
|
|
620,262 |
|
Tangible shareholders’ equity |
$ |
1,030,689 |
|
|
$ |
964,162 |
|
|
$ |
922,867 |
|
|
$ |
906,988 |
|
|
$ |
840,584 |
|
|
$ |
1,030,689 |
|
|
$ |
840,584 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Shares outstanding at end of period |
|
53,446 |
|
|
|
53,564 |
|
|
|
53,551 |
|
|
|
53,291 |
|
|
|
53,322 |
|
|
|
53,446 |
|
|
|
53,322 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Tangible book value per share |
$ |
19.28 |
|
|
$ |
18.00 |
|
|
$ |
17.23 |
|
|
$ |
17.02 |
|
|
$ |
15.76 |
|
|
$ |
19.28 |
|
|
$ |
15.76 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Average shareholders’ equity |
$ |
1,587,918 |
|
|
$ |
1,538,124 |
|
|
$ |
1,528,298 |
|
|
$ |
1,475,377 |
|
|
$ |
1,471,009 |
|
|
$ |
1,551,579 |
|
|
$ |
1,449,382 |
|
Less: Average goodwill and core deposit intangibles, net |
|
598,866 |
|
|
|
604,722 |
|
|
|
611,149 |
|
|
|
617,236 |
|
|
|
623,864 |
|
|
|
604,890 |
|
|
|
630,890 |
|
Average tangible shareholders’ equity |
$ |
989,052 |
|
|
$ |
933,402 |
|
|
$ |
917,149 |
|
|
$ |
858,141 |
|
|
$ |
847,145 |
|
|
$ |
946,689 |
|
|
$ |
818,492 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Return on average tangible equity(B) |
|
13.63 |
% |
|
|
12.82 |
% |
|
|
11.47 |
% |
|
|
12.61 |
% |
|
|
14.47 |
% |
|
|
12.67 |
% |
|
|
16.86 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total assets |
$ |
10,629,777 |
|
|
$ |
10,723,663 |
|
|
$ |
10,729,222 |
|
|
$ |
10,647,139 |
|
|
$ |
10,665,460 |
|
|
$ |
10,629,777 |
|
|
$ |
10,665,460 |
|
Less: Goodwill and core deposit intangibles, net |
|
595,434 |
|
|
|
601,633 |
|
|
|
607,831 |
|
|
|
614,030 |
|
|
|
620,262 |
|
|
|
595,434 |
|
|
|
620,262 |
|
Tangible assets |
$ |
10,034,343 |
|
|
$ |
10,122,030 |
|
|
$ |
10,121,391 |
|
|
$ |
10,033,109 |
|
|
$ |
10,045,198 |
|
|
$ |
10,034,343 |
|
|
$ |
10,045,198 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Tangible equity to tangible assets |
|
10.27 |
% |
|
|
9.53 |
% |
|
|
9.12 |
% |
|
|
9.04 |
% |
|
|
8.37 |
% |
|
|
10.27 |
% |
|
|
8.37 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net interest income (tax equivalent) |
$ |
101,578 |
|
|
$ |
101,482 |
|
|
$ |
102,207 |
|
|
$ |
106,121 |
|
|
$ |
106,919 |
|
|
$ |
305,266 |
|
|
$ |
331,549 |
|
Less: Purchase accounting accretion |
|
6,795 |
|
|
|
10,098 |
|
|
|
8,551 |
|
|
|
11,726 |
|
|
|
12,400 |
|
|
|
25,444 |
|
|
|
35,076 |
|
Adjusted net interest income (tax equivalent) |
$ |
94,783 |
|
|
$ |
91,384 |
|
|
$ |
93,656 |
|
|
$ |
94,395 |
|
|
$ |
94,519 |
|
|
$ |
279,822 |
|
|
$ |
296,473 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Average earning assets |
$ |
9,643,629 |
|
|
$ |
9,616,874 |
|
|
$ |
9,645,544 |
|
|
$ |
9,576,927 |
|
|
$ |
9,697,553 |
|
|
$ |
9,635,379 |
|
|
$ |
9,735,194 |
|
Net interest margin (tax equivalent) excluding PAA |
|
3.91 |
% |
|
|
3.82 |
% |
|
|
3.91 |
% |
|
|
3.91 |
% |
|
|
3.87 |
% |
|
|
3.88 |
% |
|
|
4.07 |
% |
(A) |
Represents total noninterest expense, excluding acquisition and merger-related expenses, core deposit intangibles amortization and write-downs on assets moved to held for sale, divided by the sum of net interest income, excluding purchase accounting adjustments plus noninterest income, excluding gains and losses on the sale of assets. Additionally, taxes and provision for credit losses are not part of this calculation. |
(B) |
Interim periods annualized. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241025254169/en/
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Investor Relations
IR@stellar.bank
