DALLAS, Oct. 18, 2017 (GLOBE NEWSWIRE) -- Triumph Bancorp, Inc. (Nasdaq:TBK) ("Triumph") today announced earnings and operating results for the third quarter of 2017.

As part of how we measure our results, we use certain non-GAAP financial measures to ascertain performance.  These non-GAAP financial measures are reconciled in the section labeled "Metrics and non-GAAP financial reconciliation" at the end of this press release.

2017 Third Quarter Highlights
  • For the third quarter of 2017, net income was $9.8 million and net income available to common stockholders was $9.6 million, compared to net income of $9.7 million and net income available to common stockholders of $9.5 million for the quarter ended June 30, 2017.
  • Diluted earnings per share were $0.47 for the quarter ended September 30, 2017, compared to $0.51 for the quarter ended June 30, 2017.  Earnings per share were impacted by our public offering of 2.53 million shares of our common stock on August 1, 2017.  Our net proceeds from the offering, after deducting the underwriting discount and offering expenses, were $65.5 million.
  • Total loans held for investment increased $130.4 million, or 5.7%, to $2.425 billion at September 30, 2017, compared to $2.295 billion at June 30, 2017.
  • Non-performing assets to total assets decreased to 1.42% at September 30, 2017 from 1.50% at June 30, 2017. Net charge-offs to average loans decreased to 0.00% for the quarter ended September 30, 2017, compared to 0.03% for the quarter ended June 30, 2017.
  • Net interest margin ("NIM") was 5.90% for the quarter ended September 30, 2017, compared to 6.16% for the quarter ended June 30, 2017. Adjusted NIM, which excludes loan discount accretion, was 5.69% for the quarter ended September 30, 2017, compared to 5.70% for the quarter ended June 30, 2017.

Balance Sheet

Total loans held for investment were $2.425 billion at September 30, 2017.  Our commercial finance loans, which comprise 37% of the loan portfolio, were $886.9 million at September 30, 2017, compared to $801.7 million at June 30, 2017.  This is an increase of $85.2 million, or 10.6%, in the third quarter of 2017, and includes a $48.2 million, or 16.4%, increase in factored receivables. 

Total deposits were $2.013 billion at September 30, 2017, a decrease of $59.6 million or 2.9% for the third quarter of 2017.  The decrease in deposits was due in part to our intentional plan to reduce our reliance on the use of public funds. Non-interest-bearing deposits accounted for 20% of total deposits and non-time deposits accounted for 51% of total deposits at September 30, 2017.

Net Interest Income

We earned net interest income for the quarter ended September 30, 2017 of $39.5 million compared to $38.6 million for the quarter ended June 30, 2017. 

Yields on loans for the quarter ended September 30, 2017 were down 35 bps from the prior quarter to 7.44% (down 5 bps from the prior quarter to 7.20% adjusted to exclude loan discount accretion). The average cost of our total deposits was 0.64% for the quarter ended September 30, 2017 compared to 0.60% for the quarter ended June 30, 2017, on an annualized basis. 

Asset Quality

Non-performing assets decreased 8 bps from June 30, 2017 to 1.42% of total assets at September 30, 2017.  The ratio of past due to total loans decreased to 2.22% at September 30, 2017 from 2.51% at June 30, 2017.  We recorded total net charge-offs of $0.0 million for the quarter ended September 30, 2017 compared to net charge-offs of $0.7 million for the quarter ended June 30, 2017.  We recorded a provision for loan losses of $0.6 million for the quarter ended September 30, 2017 compared to a provision of $1.4 million for the quarter ended June 30, 2017. From June 30, 2017 to September 30, 2017, our ALLL increased from $19.8 million or 0.86% of total loans to $20.4 million or 0.84% of total loans. 

Non-interest Income and Expense

We earned non-interest income for the quarter ended September 30, 2017 of $4.2 million compared to $5.2 million for the quarter ended June 30, 2017. Non-interest income for the quarter ended June 30, 2017 included $1.0 million of income from our CLO warehouse investment. The CLO associated with our CLO warehouse investment was closed and our invested funds were returned in June 2017.

For the quarter ended September 30, 2017, non-interest expense totaled $28.2 million compared to $27.3 million for the quarter ended June 30, 2017.

Branch Acquisition

As previously announced, we closed our acquisition of 9 branches in Colorado from Independent Bank Group, Inc.'s banking subsidiary Independent Bank on October 6, 2017. TBK Bank purchased approximately $99 million in loans and assumed approximately $162 million in deposits associated with the branches.

Conference Call Information

Aaron P. Graft, Vice Chairman and CEO and Bryce Fowler, CFO will review the quarterly results in a conference call for investors and analysts beginning at 8:30 a.m. Central Time on Thursday, October 19, 2017. Dan Karas, Chief Lending Officer, will also be available for questions.

To participate in the live conference call, please dial 1-855-940-9472 (Canada: 1-855-669-9657) and request to be joined into the Triumph Bancorp, Inc. (TBK) call.  A simultaneous audio-only webcast may be accessed via our website at www.triumphbancorp.com through the Investor Relations, News & Events, Webcasts and Presentations links, or through a direct link here at http://services.choruscall.com/links/tbk171019.html. An archive of this conference call will subsequently be available at this same location on our website.

About Triumph

Triumph Bancorp, Inc. (Nasdaq:TBK) is a financial holding company headquartered in Dallas, Texas.  Triumph offers a diversified line of community banking and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com

Forward-Looking Statements

This press release contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as "believes," "expects," "could," "may," "will," "should," "seeks," "likely," "intends," "plans," "pro forma," "projects," "estimates" or "anticipates" or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: our limited operating history as an integrated company; business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market area; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; risks related to the integration of acquired businesses (including our acquisition of nine branches from Independent Bank in Colorado and our pending acquisition of Valley Bancorp, Inc.) and any future acquisitions; changes in management personnel; interest rate risk; concentration of our factoring services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve non-performing assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of the Federal Deposit Insurance Corporation insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph's Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 17, 2017 and Triumph's Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2017, filed with the Securities and Exchange Commission on July 21, 2017.

Non-GAAP Financial Measures

This press release includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of this press release.

The following table sets forth key metrics used by Triumph to monitor its operations. Footnotes in this table can be found in our definitions of non-GAAP financial measures at the end of this document.
    As of and for the Three Months Ended     As of and for the Nine Months Ended  
    September 30,     June 30,     March 31,     December 31,     September 30,     September 30,     September 30,  
(Dollars in thousands)   2017     2017     2017     2016     2016     2017     2016  
Financial Highlights:                                                        
Total assets   $ 2,906,161     $ 2,836,684     $ 2,635,358     $ 2,641,067     $ 2,575,490     $ 2,906,161     $ 2,575,490  
Loans held for investment   $ 2,425,463     $ 2,295,100     $ 2,035,236     $ 2,027,624     $ 1,959,855     $ 2,425,463     $ 1,959,855  
Deposits   $ 2,012,545     $ 2,072,181     $ 2,024,288     $ 2,015,785     $ 1,950,677     $ 2,012,545     $ 1,950,677  
Net income available to common stockholders   $ 9,587     $ 9,467     $ 10,281     $ 6,064     $ 4,506     $ 29,335     $ 13,749  
                                                         
Performance Ratios - Annualized:                                                        
Return on average assets     1.36 %     1.42 %     1.62 %     0.96 %     0.84 %     1.46 %     1.01 %
Return on average total equity     10.71 %     12.60 %     14.44 %     8.58 %     6.63 %     12.44 %     6.89 %
Return on average common equity     10.79 %     12.75 %     14.66 %     8.60 %     6.51 %     12.58 %     6.83 %
Return on average tangible common equity  (1)     12.28 %     14.94 %     17.49 %     10.32 %     7.60 %     14.65 %     7.73 %
Yield on loans     7.44 %     7.79 %     7.15 %     7.36 %     7.42 %     7.47 %     7.87 %
Adjusted yield on loans (1)     7.20 %     7.25 %     6.93 %     6.82 %     7.10 %     7.14 %     7.42 %
Cost of interest bearing deposits     0.80 %     0.74 %     0.71 %     0.66 %     0.68 %     0.75 %     0.71 %
Cost of total deposits     0.64 %     0.60 %     0.58 %     0.54 %     0.57 %     0.61 %     0.61 %
Cost of total funds     0.90 %     0.83 %     0.79 %     0.73 %     0.61 %     0.84 %     0.65 %
Net interest margin     5.90 %     6.16 %     5.37 %     5.60 %     5.79 %     5.82 %     6.05 %
Adjusted net interest margin (1)     5.69 %     5.70 %     5.19 %     5.15 %     5.53 %     5.54 %     5.69 %
Net non-interest expense to average assets     3.35 %     3.26 %     1.17 %     3.16 %     3.43 %     2.63 %     3.61 %
Adjusted net non-interest expense to average assets (1)     3.35 %     3.26 %     3.60 %     3.16 %     3.15 %     3.40 %     3.50 %
Efficiency ratio     64.61 %     62.44 %     58.94 %     67.70 %     70.63 %     61.68 %     70.76 %
Adjusted efficiency ratio (1)     64.61 %     62.44 %     77.65 %     67.70 %     66.20 %     67.82 %     69.03 %
                                                         
Asset Quality: (2)                                                        
Past due to total loans     2.22 %     2.51 %     3.16 %     3.61 %     3.86 %     2.22 %     3.86 %
Non-performing loans to total loans     1.25 %     1.36 %     1.80 %     2.23 %     2.25 %     1.25 %     2.25 %
Non-performing assets to total assets     1.42 %     1.50 %     1.92 %     1.98 %     2.05 %     1.42 %     2.05 %
ALLL to non-performing loans     67.33 %     63.56 %     52.18 %     34.00 %     33.78 %     67.33 %     33.78 %
ALLL to total loans     0.84 %     0.86 %     0.94 %     0.76 %     0.76 %     0.84 %     0.76 %
Net charge-offs to average loans     0.00 %     0.03 %     0.20 %     0.10 %     0.10 %     0.22 %     0.13 %
                                                         
Capital:                                                        
Tier 1 capital to average assets (3)     13.50 %     11.28 %     11.32 %     10.85 %     12.04 %     13.50 %     12.04 %
Tier 1 capital to risk-weighted assets (3)     13.45 %     11.30 %     12.05 %     11.85 %     11.94 %     13.45 %     11.94 %
Common equity tier 1 capital to risk-weighted assets (3)     11.95 %     9.73 %     10.32 %     10.18 %     10.24 %     11.95 %     10.24 %
Total capital to risk-weighted assets (3)     15.91 %     13.87 %     14.87 %     14.60 %     14.77 %     15.91 %     14.77 %
Total equity to total assets     13.29 %     10.94 %     11.40 %     10.96 %     11.05 %     13.29 %     11.05 %
Tangible common stockholders' equity to tangible assets     11.66 %     9.22 %     9.51 %     8.98 %     8.99 %     11.66 %     8.99 %
                                                         
Per Share Amounts:                                                        
Book value per share   $ 18.08     $ 16.59     $ 16.08     $ 15.47     $ 15.18     $ 18.08     $ 15.18  
Tangible book value per share (1)   $ 16.04     $ 14.20     $ 13.63     $ 12.89     $ 12.55     $ 16.04     $ 12.55  
Basic earnings per common share   $ 0.48     $ 0.53     $ 0.57     $ 0.34     $ 0.25     $ 1.58     $ 0.77  
Diluted earnings per common share   $ 0.47     $ 0.51     $ 0.55     $ 0.33     $ 0.25     $ 1.53     $ 0.76  
Adjusted diluted earnings per common share (1)   $ 0.47     $ 0.51     $ 0.02     $ 0.33     $ 0.32     $ 1.02     $ 0.84  
Shares outstanding end of period     20,820,900       18,132,585       18,078,769       18,078,247       18,106,978       20,820,900       18,106,978  

Unaudited consolidated balance sheet as of:
    September 30,     June 30,     March 31,     December 31,     September 30,  
 (Dollars in thousands)   2017     2017     2017     2016     2016  
ASSETS                                        
Total cash and cash equivalents   $ 80,557     $ 117,502     $ 126,084     $ 114,514     $ 104,725  
Securities - available for sale     209,326       227,206       254,452       275,029       286,574  
Securities - held to maturity     17,999       26,036       28,882       29,352       29,316  
Loans held for sale                             9,623  
Loans held for investment     2,425,463       2,295,100       2,035,236       2,027,624       1,959,855  
Allowance for loan and lease losses     (20,367 )     (19,797 )     (19,093 )     (15,405 )     (14,912 )
Loans, net     2,405,096       2,275,303       2,016,143       2,012,219       1,944,943  
FHLB stock     16,076       14,566       7,167       8,430       8,397  
Premises and equipment, net     43,678       43,957       44,630       45,460       45,050  
Other real estate owned ("OREO"), net     10,753       10,740       11,638       6,077       8,061  
Goodwill and intangible assets, net     42,452       43,321       44,233       46,531       47,449  
Bank-owned life insurance     37,025       36,852       36,679       36,509       36,347  
Deferred tax asset, net     14,130       15,111       15,678       18,825       20,042  
Other assets     29,069       26,090       49,772       48,121       34,963  
Total assets   $ 2,906,161     $ 2,836,684     $ 2,635,358     $ 2,641,067     $ 2,575,490  
LIABILITIES                                        
Non-interest bearing deposits   $ 403,643     $ 381,042     $ 382,009     $ 363,351     $ 339,999  
Interest bearing deposits     1,608,902       1,691,139       1,642,279       1,652,434       1,610,678  
Total deposits     2,012,545       2,072,181       2,024,288       2,015,785       1,950,677  
Customer repurchase agreements     19,869       14,959       10,468       10,490       15,329  
Federal Home Loan Bank advances     385,000       340,000       200,000       230,000       230,000  
Subordinated notes     48,804       48,780       48,757       48,734       48,676  
Junior subordinated debentures     33,047       32,943       32,840       32,740       32,640  
Other liabilities     20,799       17,354       18,580       13,973       13,647  
Total liabilities     2,520,064       2,526,217       2,334,933       2,351,722       2,290,969  
EQUITY                                        
Preferred stock series A     4,550       4,550       4,550       4,550       4,550  
Preferred stock series B     5,108       5,108       5,196       5,196       5,196  
Common stock     209       182       182       182       182  
Additional paid-in-capital     264,531       198,570       197,866       197,157       196,306  
Treasury stock, at cost     (1,760 )     (1,759 )     (1,494 )     (1,374 )     (751 )
Retained earnings     113,245       103,658       94,191       83,910       77,846  
Accumulated other comprehensive income     214       158       (66 )     (276 )     1,192  
Total equity     386,097       310,467       300,425       289,345       284,521  
Total liabilities and equity   $ 2,906,161     $ 2,836,684     $ 2,635,358     $ 2,641,067     $ 2,575,490  

Unaudited consolidated statement of income:
    For the Three Months Ended     For the Nine Months Ended  
    September 30,     June 30,     March 31,     December 31,     September 30,     September 30,     September 30,  
 (Dollars in thousands)   2017     2017     2017     2016     2016     2017     2016  
Interest income:                                                        
Loans, including fees   $ 30,863     $ 30,663     $ 25,185     $ 26,486     $ 23,123     $ 86,711     $ 57,758  
Factored receivables, including fees     12,198       10,812       9,167       9,731       9,021       32,177       25,482  
Securities     1,655       1,738       1,611       1,368       1,218       5,004       2,941  
FHLB stock     51       36       42       34       16       129       39  
Cash deposits     370       289       327       155       93       986       498  
Total interest income     45,137       43,538       36,332       37,774       33,471       125,007       86,718  
Interest expense:                                                        
Deposits     3,272       3,057       2,869       2,735       2,408       9,198       6,421  
Subordinated notes     837       836       835       835             2,508        
Junior subordinated debentures     495       475       465       431       382       1,435       996  
Other borrowings     1,021       613       344       229       263       1,978       487  
Total interest expense     5,625       4,981       4,513       4,230       3,053       15,119       7,904  
Net interest income     39,512       38,557       31,819       33,544       30,418       109,888       78,814  
Provision for loan losses     572       1,447       7,678       2,446       2,819       9,697       4,247  
Net interest income after provision for loan losses     38,940       37,110       24,141       31,098       27,599       100,191       74,567  
Non-interest income:                                                        
Service charges on deposits     1,046       977       980       1,109       984       3,003       2,338  
Card income     956       917       827       842       767       2,700       1,890  
Net OREO gains (losses) and valuation adjustments     15       (112 )     11       (275 )     63       (86 )     (1,152 )
Net gains (losses) on sale of securities     35                   7       (68 )     35       (63 )
Net gains on sale of loans                                         16  
Fee income     625       637       583       547       655       1,845       1,693  
Asset management fees                 1,717       1,787       1,553       1,717       4,787  
Gain on sale of subsidiary                 20,860                   20,860        
Other     1,494       2,783       2,307       2,191       2,145       6,584       5,239  
Total non-interest income     4,171       5,202       27,285       6,208       6,099       36,658       14,748  
Non-interest expense:                                                        
Salaries and employee benefits     16,717       16,012       21,958       15,351       14,699       54,687       39,180  
Occupancy, furniture and equipment     2,398       2,348       2,359       2,353       1,921       7,105       4,948  
FDIC insurance and other regulatory assessments     294       270       226       265       143       790       648  
Professional fees     1,465       1,238       1,968       1,481       1,874       4,671       4,048  
Amortization of intangible assets     870       911       1,111       1,130       958       2,892       2,652  
Advertising and promotion     804       911       938       790       779       2,653       1,926  
Communications and technology     2,145       2,233       2,174       1,830       1,966       6,552       4,661  
Other     3,532       3,398       4,103       3,711       3,452       11,033       8,138  
Total non-interest expense     28,225       27,321       34,837       26,911       25,792       90,383       66,201  
Net income before income tax     14,886       14,991       16,589       10,395       7,906       46,466       23,114  
Income tax expense     5,104       5,331       6,116       4,134       3,099       16,551       8,675  
Net income   $ 9,782     $ 9,660     $ 10,473     $ 6,261     $ 4,807     $ 29,915     $ 14,439  
Dividends on preferred stock     (195 )     (193 )     (192 )     (197 )     (301 )     (580 )     (690 )
Net income available to common stockholders   $ 9,587     $ 9,467     $ 10,281     $ 6,064     $ 4,506     $ 29,335     $ 13,749  

Earnings per share:
    For the Three Months Ended     For the Nine Months Ended  
    September 30,     June 30,     March 31,     December 31,     September 30,     September 30,     September 30,  
(Dollars in thousands)   2017     2017     2017     2016     2016     2017     2016  
Basic                                                        
Net income to common stockholders   $ 9,587     $ 9,467     $ 10,281     $ 6,064     $ 4,506     $ 29,335     $ 13,749  
Weighted average common shares outstanding     19,811,577       18,012,905       17,955,144       17,890,781       17,859,604       18,600,009       17,845,431  
Basic earnings per common share   $ 0.48     $ 0.53     $ 0.57     $ 0.34     $ 0.25     $ 1.58     $ 0.77  
                                                         
Diluted                                                        
Net income to common stockholders   $ 9,587     $ 9,467     $ 10,281     $ 6,064     $ 4,506     $ 29,335     $ 13,749  
Dilutive effect of preferred stock     195       193       192       197             580        
Net income to common stockholders - diluted   $ 9,782     $ 9,660     $ 10,473     $ 6,261     $ 4,506     $ 29,915     $ 13,749  
Weighted average common shares outstanding     19,811,577       18,012,905       17,955,144       17,890,781       17,859,604       18,600,009       17,845,431  
Dilutive effects of:                                                        
Restricted stock     63,384       47,521       87,094       66,613       148,977       65,999       125,215  
Assumed exercises of stock warrants     54,476       129,896       145,896       118,285       93,095       110,089       71,251  
Assumed exercises of stock options     45,788       32,592       47,873       12,511             42,084        
Assumed conversion of Preferred A     315,773       315,773       315,773       315,773             315,773        
Assumed conversion of Preferred B     354,471       354,471       360,578       360,578             354,471        
Weighted average shares outstanding - diluted     20,645,469       18,893,158       18,912,358       18,764,541       18,101,676       19,488,425       18,041,897  
Diluted earnings per common share   $ 0.47     $ 0.51     $ 0.55     $ 0.33     $ 0.25     $ 1.53     $ 0.76  
                                                         
                                                         
Shares that were not considered in computing diluted earnings per common share because they were antidilutive are as follows:  
                                                         
    For the Three Months Ended     For the Nine Months Ended  
    September 30,     June 30,     March 31,     December 31,     September 30,     September 30,     September 30,  
    2017     2017     2017     2016     2016     2017     2016  
Assumed conversion of Preferred A                             315,773             315,773  
Assumed conversion of Preferred B                             360,578             360,578  
Restricted stock awards           35,270                                
Stock options     58,442       58,442                   164,175       58,442       164,175  

Loans held for investment summarized as of:
    September 30,     June 30,     March 31,     December 31,     September 30,  
 (Dollars in thousands)   2017     2017     2017     2016     2016  
Commercial real estate   $ 574,530     $ 541,217     $ 498,099     $ 442,237     $ 420,742  
Construction, land development, land     141,368       120,253       109,849       109,812       101,169  
1-4 family residential properties     96,032       101,833       105,230       104,974       108,721  
Farmland     130,471       136,258       136,537       141,615       139,109  
Commercial     890,372       842,715       792,764       778,643       777,806  
Factored receivables     341,880       293,633       242,098       238,198       213,955  
Consumer     30,093       29,497       28,415       29,764       25,602  
Mortgage warehouse     220,717       229,694       122,244       182,381       172,751  
Total loans   $ 2,425,463     $ 2,295,100     $ 2,035,236     $ 2,027,624     $ 1,959,855  

A portion of our total loan portfolio consists of commercial finance products offered under our commercial finance brands on a nationwide basis, as further summarized below:
    September 30,     June 30,     March 31,     December 31,     September 30,  
(Dollars in thousands)   2017     2017     2017     2016     2016  
Equipment   $ 226,120     $ 219,904     $ 203,251     $ 190,393     $ 181,987  
Asset based lending (General)     193,884       188,257       166,917       161,454       129,501  
Asset based lending (Healthcare)     67,889       68,606       78,208       79,668       84,900  
Premium finance     57,083       31,274       23,162       23,971       27,573  
Factored receivables     341,880       293,633       242,098       238,198       213,955  
Commercial finance   $ 886,856     $ 801,674     $ 713,636     $ 693,684     $ 637,916  
                                         
Commercial finance % of total loans     37 %     35 %     35 %     34 %     33 %
Yield on commercial finance loans     10.62 %     11.42 %     10.25 %     10.54 %     10.57 %

Deposits summarized as of:
    September 30,     June 30,     March 31,     December 31,     September 30,    
(Dollars in thousands)   2017     2017     2017     2016     2016    
Non-interest bearing demand   $ 403,643     $ 381,042     $ 382,009     $ 363,351     $ 339,999    
Interest bearing demand     284,282       350,966       329,201       340,362       311,351    
Individual retirement accounts     97,186       99,694       100,436       103,022       103,007    
Money market     189,177       205,243       203,686       213,253       209,572    
Savings     158,464       173,137       173,258       171,354       171,665    
Certificates of deposit     770,599       777,459       767,602       756,351       765,093    
Brokered deposits     109,194       84,640       68,096       68,092       49,990    
Total deposits   $ 2,012,545     $ 2,072,181     $ 2,024,288     $ 2,015,785     $ 1,950,677    

Net interest margin summarized for the three months ended:
    September 30, 2017     June 30, 2017  
    Average             Average     Average             Average  
(Dollars in thousands)   Balance     Interest     Rate     Balance     Interest     Rate  
Interest earning assets:                                                
Interest earning cash balances   $ 111,364     $ 370       1.32 %   $ 99,918     $ 289       1.16 %
Taxable securities     211,354       1,570       2.95 %     240,725       1,653       2.75 %
Tax-exempt securities     25,174       85       1.34 %     25,389       85       1.34 %
FHLB stock     14,885       51       1.36 %     10,395       36       1.39 %
Loans     2,295,356       43,061       7.44 %     2,135,346       41,475       7.79 %
Total interest earning assets   $ 2,658,133     $ 45,137       6.74 %   $ 2,511,773     $ 43,538       6.95 %
Non-interest earning assets:                                                
Other assets     191,037                       211,530                  
Total assets   $ 2,849,170                     $ 2,723,303                  
Interest bearing liabilities:                                                
Deposits:                                                
Interest bearing demand   $ 312,009     $ 137       0.17 %   $ 342,947     $ 136       0.16 %
Individual retirement accounts     98,713       309       1.24 %     100,505       303       1.21 %
Money market     201,462       118       0.23 %     206,163       120       0.23 %
Savings     167,908       20       0.05 %     171,602       27       0.06 %
Certificates of deposit     773,075       2,381       1.22 %     773,178       2,224       1.15 %
Brokered deposits     72,094       307       1.69 %     67,852       247       1.46 %
Total deposits     1,625,261       3,272       0.80 %     1,662,247       3,057       0.74 %
Subordinated notes     48,791       837       6.81 %     48,767       836       6.88 %
Junior subordinated debentures     32,983       495       5.95 %     32,878       475       5.79 %
Other borrowings     365,464       1,021       1.11 %     271,136       613       0.91 %
Total interest bearing liabilities   $ 2,072,499     $ 5,625       1.08 %   $ 2,015,028     $ 4,981       0.99 %
Non-interest bearing liabilities and equity:                                                
Non-interest bearing demand deposits     398,774                       387,877                  
Other liabilities     15,698                       12,808                  
Total equity     362,199                       307,590                  
Total liabilities and equity   $ 2,849,170                     $ 2,723,303                  
Net interest income           $ 39,512                     $ 38,557          
Interest spread                     5.66 %                     5.96 %
Net interest margin                     5.90 %                     6.16 %

Metrics and non-GAAP financial reconciliation:
    As of and for the Three Months Ended     As of and for the Nine Months Ended  
 (Dollars in thousands,   September 30,     June 30,     March 31,     December 31,     September 30,     September 30,     September 30,  
 except per share amounts)   2017     2017     2017     2016     2016     2017     2016  
Net income available to common stockholders   $ 9,587     $ 9,467     $ 10,281     $ 6,064     $ 4,506     $ 29,335     $ 13,749  
Gain on sale of subsidiary                 (20,860 )                 (20,860 )      
Incremental bonus related to transaction                 4,814                   4,814        
Transaction related costs                 325             1,618       325       1,618  
Tax effect of adjustments                 5,754             (251 )     5,754       (251 )
Adjusted net income available to common stockholders   $ 9,587     $ 9,467     $ 314     $ 6,064     $ 5,873     $ 19,368     $ 15,116  
Dilutive effect of convertible preferred stock     195       193             197       197       580        
Adjusted net income available to common stockholders - diluted   $ 9,782     $ 9,660     $ 314     $ 6,261     $ 6,070     $ 19,948     $ 15,116  
                                                         
Weighted average shares outstanding - diluted     20,645,469       18,893,158       18,912,358       18,764,541       18,101,676       19,488,425       18,041,897  
Adjusted effects of assumed Preferred Stock conversion                 (676,351 )           676,351              
Adjusted weighted average shares outstanding - diluted     20,645,469       18,893,158       18,236,007       18,764,541       18,778,027       19,488,425       18,041,897  
Adjusted diluted earnings per common share   $ 0.47     $ 0.51     $ 0.02     $ 0.33     $ 0.32     $ 1.02     $ 0.84  
                                                         
Net income available to common stockholders   $ 9,587     $ 9,467     $ 10,281     $ 6,064     $ 4,506     $ 29,335     $ 13,749  
Average tangible common equity     309,624       254,088       238,405       233,733       235,938       267,633       237,647  
Return on average tangible common equity     12.28 %     14.94 %     17.49 %     10.32 %     7.60 %     14.65 %     7.73 %
                                                         
Adjusted efficiency ratio:                                                        
Net interest income   $ 39,512     $ 38,557     $ 31,819     $ 33,544     $ 30,418     $ 109,888     $ 78,814  
Non-interest income     4,171       5,202       27,285       6,208       6,099       36,658       14,748  
Operating revenue     43,683       43,759       59,104       39,752       36,517       146,546       93,562  
Gain on sale of subsidiary                 (20,860 )                 (20,860 )      
Adjusted operating revenue   $ 43,683     $ 43,759     $ 38,244     $ 39,752     $ 36,517     $ 125,686     $ 93,562  
Non-interest expenses   $ 28,225     $ 27,321     $ 34,837     $ 26,911     $ 25,792     $ 90,383     $ 66,201  
Incremental bonus related to transaction                 (4,814 )                 (4,814 )      
Transaction related costs                 (325 )           (1,618 )     (325 )     (1,618 )
Adjusted non-interest expenses   $ 28,225     $ 27,321     $ 29,698     $ 26,911     $ 24,174     $ 85,244     $ 64,583  
Adjusted efficiency ratio     64.61 %     62.44 %     77.65 %     67.70 %     66.20 %     67.82 %     69.03 %
                                                         
Adjusted net non-interest expense to average assets ratio:                                                        
Non-interest expenses   $ 28,225     $ 27,321     $ 34,837     $ 26,911     $ 25,792     $ 90,383     $ 66,201  
Incremental bonus related to transaction                 (4,814 )                 (4,814 )      
Transaction related costs                 (325 )           (1,618 )     (325 )     (1,618 )
Adjusted non-interest expenses   $ 28,225     $ 27,321     $ 29,698     $ 26,911     $ 24,174     $ 85,244     $ 64,583  
                                                         
Total non-interest income   $ 4,171     $ 5,202     $ 27,285     $ 6,208     $ 6,099     $ 36,658     $ 14,748  
Gain on sale of subsidiary                 (20,860 )                 (20,860 )      
Adjusted non-interest income   $ 4,171     $ 5,202     $ 6,425     $ 6,208     $ 6,099     $ 15,798     $ 14,748  
Adjusted net non-interest expenses   $ 24,054     $ 22,119     $ 23,273     $ 20,703     $ 18,075     $ 69,446     $ 49,835  
Average total assets   $ 2,849,170     $ 2,723,303     $ 2,619,282     $ 2,603,226     $ 2,282,279     $ 2,731,426     $ 1,904,001  
Adjusted net non-interest expense to average assets ratio     3.35 %     3.26 %     3.60 %     3.16 %     3.15 %     3.40 %     3.50 %

    As of and for the Three Months Ended     As of and for the Nine Months Ended  
 (Dollars in thousands,   September 30,     June 30,     March 31,     December 31,     September 30,     September 30,     September 30,  
 except per share amounts)   2017     2017     2017     2016     2016     2017     2016  
Reported yield on loans     7.44 %     7.79 %     7.15 %     7.36 %     7.42 %     7.47 %     7.87 %
Effect of accretion income on acquired loans     (0.24 %)     (0.54 %)     (0.22 %)     (0.54 %)     (0.32 %)     (0.33 %)     (0.45 %)
Adjusted yield on loans     7.20 %     7.25 %     6.93 %     6.82 %     7.10 %     7.14 %     7.42 %
                                                         
Reported net interest margin     5.90 %     6.16 %     5.37 %     5.60 %     5.79 %     5.82 %     6.05 %
Effect of accretion income on acquired loans     (0.21 %)     (0.46 %)     (0.18 %)     (0.45 %)     (0.26 %)     (0.28 %)     (0.36 %)
Adjusted net interest margin     5.69 %     5.70 %     5.19 %     5.15 %     5.53 %     5.54 %     5.69 %
                                                         
Total stockholders' equity   $ 386,097     $ 310,467     $ 300,425     $ 289,345     $ 284,521     $ 386,097     $ 284,521  
Preferred stock liquidation preference     (9,658 )     (9,658 )     (9,746 )     (9,746 )     (9,746 )     (9,658 )     (9,746 )
Total common stockholders' equity     376,439       300,809       290,679       279,599       274,775       376,439       274,775  
Goodwill and other intangibles     (42,452 )     (43,321 )     (44,233 )     (46,531 )     (47,449 )     (42,452 )     (47,449 )
Tangible common stockholders' equity   $ 333,987     $ 257,488     $ 246,446     $ 233,068     $ 227,326     $ 333,987     $ 227,326  
Common shares outstanding     20,820,900       18,132,585       18,078,769       18,078,247       18,106,978       20,820,900       18,106,978  
Tangible book value per share   $ 16.04     $ 14.20     $ 13.63     $ 12.89     $ 12.55     $ 16.04     $ 12.55  
                                                         
Total assets at end of period   $ 2,906,161     $ 2,836,684     $ 2,635,358     $ 2,641,067     $ 2,575,490     $ 2,906,161     $ 2,575,490  
Goodwill and other intangibles     (42,452 )     (43,321 )     (44,233 )     (46,531 )     (47,449 )     (42,452 )     (47,449 )
Adjusted total assets at period end   $ 2,863,709     $ 2,793,363     $ 2,591,125     $ 2,594,536     $ 2,528,041     $ 2,863,709     $ 2,528,041  
Tangible common stockholders' equity ratio     11.66 %     9.22 %     9.51 %     8.98 %     8.99 %     11.66 %     8.99 %

1)       Triumph uses certain non-GAAP financial measures to provide meaningful supplemental information regarding Triumph's operational performance and to enhance investors' overall understanding of such financial performance.  The non-GAAP measures used by Triumph include the following:
  • "Adjusted diluted earnings per common share" is defined as adjusted net income available to common stockholders divided by adjusted weighted average diluted common shares outstanding.  Excluded from net income available to common stockholders are material gains and expenses related to merger and acquisition-related activities, including divestitures, net of tax. In our judgment, the adjustments made to net income available to common stockholders allow management and investors to better assess our performance in relation to our core net income by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.  Weighted average diluted common shares outstanding are adjusted as a result of changes in their dilutive properties given the gain and expense adjustments described herein.  
  • "Tangible common stockholders' equity" is common stockholders' equity less goodwill and other intangible assets.
  • "Total tangible assets" is defined as total assets less goodwill and other intangible assets.
  • "Tangible book value per share" is defined as tangible common stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.
  • "Tangible common stockholders' equity ratio" is defined as the ratio of tangible common stockholders' equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets.
  • "Return on Average Tangible Common Equity" is defined as net income available to common stockholders divided by average tangible common stockholders' equity.
  • "Adjusted efficiency ratio" is defined as non-interest expenses divided by our operating revenue, which is equal to net interest income plus non-interest income. Also excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. In our judgment, the adjustments made to operating revenue and non-interest expense allow management and investors to better assess our performance in relation to our core operating revenue by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.
  • "Adjusted net non-interest expense to average total assets" is defined as non-interest expenses net of non-interest income divided by total average assets. Excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures.  This metric is used by our management to better assess our operating efficiency. 
  • "Adjusted yield on loans" is our yield on loans after excluding loan discount accretion from our acquired loan portfolio.  Our management uses this metric to better assess the impact of purchase accounting on our yield on loans, as the effect of loan discount accretion is expected to decrease as the acquired loans pay down or mature and are removed from our balance sheet.
  • "Adjusted net interest margin" is net interest margin after excluding loan accretion from the acquired loan portfolio.  Our management uses this metric to better assess the impact of purchase accounting on net interest margin, as the effect of loan discount accretion is expected to decrease as the acquired loans pay down or mature and are removed from our balance sheet. 

2)       Asset quality ratios exclude loans held for sale.

3)       Current quarter ratios are preliminary.

Investor Relations:Luke WyseSenior Vice President, Finance & Investor Relationslwyse@tbkbank.com214-365-6936

Media Contact:Amanda TavackoliVice President, Marketing & Communicationatavackoli@tbkbank.com 214-365-6930

Primary Logo