SmartFinancial, Inc. ("SmartFinancial" or the "Company"; NYSE:
SMBK), today announced net income of $9.6 million, or $0.57 per
diluted common share, for the fourth quarter of 2024, compared to
net income of $6.2 million, or $0.37 per diluted common share, for
the fourth quarter of 2023, and compared to prior quarter net
income of $9.1 million, or $0.54 per diluted common share.
Operating earnings1, which excludes non-recurring income, net of
tax adjustments, totaled $9.6 million, or $0.57 per diluted common
share, in the fourth quarter of 2024, compared to $6.9 million, or
$0.41 per diluted common share, in the fourth quarter of 2023, and
compared to $9.1 million, or $0.54 per diluted common share, in the
third quarter of 2024.
Highlights for the Fourth Quarter of 2024
- Operating earnings1 of $9.6 million, or $0.57 per diluted
common share
- Net organic loan and lease growth of $189 million with 20%
annualized quarter-over-quarter increase
- Quarter-over-quarter net tax equivalent interest margin
expansion of 13 basis points to 3.24%
- Credit quality remains solid with nonperforming assets to total
assets of 0.19%
Billy Carroll, President & CEO, stated: "As we closed 2023,
I noted the strong positioning of our Company and expressed my
optimism for the year ahead. Now, reflecting on 2024, it’s clear
that this optimism was justified. Highlighted by 13% year-over-year
loan and lease growth, a fourth quarter net interest margin of
3.24%, 38 basis points higher than the fourth quarter of 2023,
continued profitability improvement and numerous operational
achievements, 2024 was a notable year. As we look ahead to 2025, we
remain committed and confident in our ability to further enhance
profitability and drive value for our shareholders.”
SmartFinancial's Chairman, Miller Welborn, concluded: "2024 was
a great year of growth and profitability expansion following an
extremely challenging 2023. The Board is pleased with the Company’s
10% annual tangible book value growth and steady return metric
enhancement. Equally important is SmartBank’s ongoing commitment to
its culture and associates. Our associates continue to make
SmartBank a great place to work, which is foundational to our
present and future success through 2025 and beyond. Thank you!”
Net Interest Income and Net Interest Margin
Net interest income was $37.8 million for the fourth quarter of
2024, compared to $35.0 million for the prior quarter. Average
earning assets totaled $4.7 billion, an increase of $151.0 million
from the prior quarter. The balances of average earnings assets
changed quarter-over-quarter, primarily from an increase in average
loans and leases of $195.5 million, offset by a decrease in average
interest-earning cash of $33.5 million and securities of $11.1
million. Average interest-bearing liabilities increased by $162.3
million from the prior quarter, primarily attributable to an
increase in average deposits of $207.9 million, offset by a
decrease in borrowings of $44.4 million.
The tax equivalent net interest margin was 3.24% for the fourth
quarter of 2024, compared to 3.11% for the prior quarter. The tax
equivalent net interest margin was positively impacted primarily by
the decreased cost of interest-bearing deposits,
quarter-over-quarter. The yield on loans and leases, excluding loan
fees, on a fully tax equivalent basis (“FTE”) held constant at
5.95% quarter-over-quarter.
The cost of total deposits for the fourth quarter of 2024 was
2.43%, compared to 2.54% in the prior quarter. The cost of
interest-bearing liabilities was 3.08% for the fourth quarter,
compared to 3.29% in the prior quarter. The cost of average
interest-bearing deposits was 3.02% for the fourth quarter of 2024,
compared to 3.20% for the prior quarter, a decrease of 18 basis
points.
__________
1 Non-GAAP measure. See “Non-GAAP
Financial Measures” for more information and see the Non-GAAP
Reconciliations.
The following table presents selected interest rates and yields
for the periods indicated:
Three Months Ended
Dec
Sep
Increase
Selected Interest Rates and Yields
2024
2024
(Decrease)
Yield on loans and leases, excluding loan
fees, FTE
5.95
%
5.95
%
-
%
Yield on loans and leases, FTE
6.04
%
6.02
%
0.02
%
Yield on earning assets, FTE
5.64
%
5.65
%
(0.01
)%
Cost of interest-bearing deposits
3.02
%
3.20
%
(0.18
)%
Cost of total deposits
2.43
%
2.54
%
(0.11
)%
Cost of interest-bearing liabilities
3.08
%
3.29
%
(0.21
)%
Net interest margin, FTE
3.24
%
3.11
%
0.13
%
Provision for Credit Losses on Loans and Leases and Credit
Quality
At December 31, 2024, the allowance for credit losses was $37.4
million. The allowance for credit losses to total loans and leases
was 0.96% as of December 31, 2024, and September 30, 2024.
The following table presents detailed information related to the
provision for credit losses for the periods indicated (dollars in
thousands):
Three Months Ended
Dec
Sep
Increase
Provision for Credit Losses on Loans and
Leases Rollforward
2024
2024
(Decrease)
Beginning balance
$
35,609
$
34,690
$
919
Charge-offs
(214
)
(1,426
)
1,212
Recoveries
53
72
(19
)
Net (charge-offs) recoveries
(161
)
(1,354
)
1,193
Provision for credit losses (1)
1,975
2,273
(298
)
Ending balance
$
37,423
$
35,609
$
1,814
Allowance for credit losses to total loans
and leases, gross
0.96
%
0.96
%
-
%
(1)
The current quarter-ended and prior
quarter-ended excludes unfunded commitments provision of $160
thousand and $302 thousand, respectively. At December 31, 2024, the
unfunded commitment liability totaled $2.5 million.
Nonperforming loans and leases as a percentage of total loans
and leases was 0.20% as of December 31, 2024, a decrease of 6 basis
points from the 0.26% reported in the third quarter of 2024. Total
nonperforming assets (which include nonaccrual loans and leases,
loans and leases past due 90 days or more and still accruing, other
real estate owned and other repossessed assets) as a percentage of
total assets was 0.19% as of December 31, 2024, and 0.26% as of
September 30, 2024.
The following table presents detailed information related to
credit quality for the periods indicated (dollars in
thousands):
Three Months Ended
Dec
Sep
Increase
Credit Quality
2024
2024
(Decrease)
Nonaccrual loans and leases
$
7,710
$
9,319
$
(1,609
)
Loans and leases past due 90 days or more
and still accruing
162
172
(10
)
Total nonperforming loans and leases
7,872
9,491
(1,619
)
Other real estate owned
179
179
-
Other repossessed assets
2,037
2,949
(912
)
Total nonperforming assets
$
10,088
$
12,619
$
(2,531
)
Nonperforming loans and leases to total
loans and leases, gross
0.20
%
0.26
%
(0.06
)%
Nonperforming assets to total assets
0.19
%
0.26
%
(0.07
)%
Noninterest Income
Noninterest income decreased $109 thousand for the fourth
quarter of 2024, compared to $9.1 million for the prior quarter.
The current quarter decrease was primarily associated with a $499
thousand decrease in investment services from a lower volume of
investment activity and offset by a $355 thousand increase in
insurance commissions from new policies.
The following table presents detailed information related to
noninterest income for the periods indicated (dollars in
thousands):
Three Months Ended
Dec
Sep
Increase
Noninterest Income
2024
2024
(Decrease)
Service charges on deposit accounts
$
1,778
$
1,780
$
(2
)
Mortgage banking income
541
410
131
Investment services
1,382
1,881
(499
)
Insurance commissions
1,832
1,477
355
Interchange and debit card transaction
fees
1,332
1,349
(17
)
Other
2,101
2,242
(141
)
Total noninterest income
$
9,030
$
9,139
$
(109
)
Noninterest Expense
Noninterest expense increased $1.4 million to $32.3 million for
the fourth quarter of 2024 compared to $30.8 million for the prior
quarter. The current quarter increase was primarily related to an
increase in salaries and employee benefits related to incentive
accruals for production performance and an increase in other real
estate and loan related expenses due to write downs on repossessed
assets at the Company’s equipment leasing subsidiary, offset by a
decrease in other related to lower operational cost and lower
franchise taxes related to the newly established Real Estate
Investment Trust (“REIT”).
The following table presents detailed information related to
noninterest expense for the periods indicated (dollars in
thousands):
Three Months Ended
Dec
Sep
Increase
Noninterest Expense
2024
2024
(Decrease)
Salaries and employee benefits
$
19,752
$
18,448
$
1,304
Occupancy and equipment
3,473
3,423
50
FDIC insurance
825
825
-
Other real estate and loan related
expenses
1,241
460
781
Advertising and marketing
397
327
70
Data processing and technology
2,495
2,519
(24
)
Professional services
1,017
1,201
(184
)
Amortization of intangibles
601
604
(3
)
Other
2,490
3,039
(549
)
Total noninterest expense
$
32,291
$
30,846
$
1,445
Income Tax Expense
Income tax expense was $2.7 million for the fourth quarter of
2024, an increase of $1.1 million, compared to $1.6 million for the
prior quarter. The increase was due to an increase in pre-tax
income compared to the prior quarter and final state income tax
adjustments during the quarter related to the Bank’s REIT. The REIT
will create a more tax-effective structure that will result in a
lower effective tax rate during future periods by lowering the
Bank’s state income tax expense.
Balance Sheet Trends
Total assets at December 31, 2024 were $5.28 billion compared to
$4.83 billion at December 31, 2023. The $446.5 million increase is
primarily attributable to increases in loans and leases of $461.9
million, cash and cash equivalents of $35.3 million and bank owned
life insurance of $32.5 million, offset by a decrease in securities
of $80.7 million.
Total liabilities were $4.78 billion at December 31, 2024,
compared to $4.37 billion at December 31, 2023, an increase of
$414.9 million. Total deposits increased $418.6 million, which was
driven primarily by increases in money market deposits of $227.1
million, the issuance of brokered deposits of $189.8 million, other
time deposits of $104.4 million and noninterest demand deposits of
$67.5 million, offset by a decline in interest-bearing demand
deposits of $170.2 million. Other liabilities increased $3.7
million, which was offset by a decrease in borrowings of $4.9
million and subordinated debt of $2.4 million.
Shareholders' equity at December 31, 2024, totaled $491.5
million, an increase of $31.6 million, from December 31, 2023. The
increase in shareholders' equity was primarily driven by net income
of $36.1 million for the twelve months ended December 31, 2024, and
a positive change of $2.2 million in accumulated other
comprehensive income, offset by dividends paid of $5.4 million.
Tangible book value per share2 was $22.85 at December 31, 2024,
compared to $20.76 at December 31, 2023. Tangible common equity1 as
a percentage of tangible assets1 was 7.48% at December 31, 2024,
compared with 7.47% at December 31, 2023.
The following table presents selected balance sheet information
for the periods indicated (dollars in thousands):
Dec
Dec
Increase
Selected Balance Sheet Information
2024
2023
(Decrease)
Total assets
$
5,275,904
$
4,829,387
$
446,517
Total liabilities
4,784,443
4,369,501
414,942
Total equity
491,461
459,886
31,575
Securities
608,987
689,646
(80,659
)
Loans and leases
3,906,340
3,444,462
461,878
Deposits
4,686,483
4,267,854
418,629
Borrowings
8,135
13,078
(4,943
)
Board of Directors Declares Dividend
On January 16, 2025, the board of directors of SmartFinancial
declared a quarterly cash dividend of $0.08 per share of
SmartFinancial common stock payable on February 18, 2025, to
shareholders of record as of the close of business on January 31,
2025.
Conference Call Information
SmartFinancial issued this earnings release for the fourth
quarter of 2024 on Tuesday, January 21, 2025, and will host a
conference call on Wednesday, January 22, 2025, at 10:00 a.m. ET.
To access this interactive teleconference, dial (833) 470-1428 or
(404) 975-4839 and entering the access code, 994691. A
replay of the conference call will be available through March 23,
2025, by dialing (866) 813-9403 or (929) 458-6194 and entering the
access code, 147026. Conference call materials will be
published on the Company’s webpage located at
http://www.smartfinancialinc.com/CorporateProfile, at 9:00 a.m. ET
prior to the conference call.
About SmartFinancial, Inc.
SmartFinancial, Inc., based in Knoxville, Tennessee, is the bank
holding company for SmartBank. SmartBank is a full-service
commercial bank founded in 2007, with branches across Tennessee,
Alabama, and Florida. Recruiting the best people, delivering
exceptional client service, strategic branching, and a disciplined
approach to lending have contributed to SmartBank’s success. More
information about SmartFinancial can be found on its website:
www.smartfinancialinc.com.
__________
1 Non-GAAP measure. See “Non-GAAP Financial Measures” for more
information and see the Non-GAAP Reconciliation
Non-GAAP Financial Measures
Statements included in this earnings release include measures
not recognized under U.S. generally accepted accounting principles
(“GAAP”) and therefore are considered Non-GAAP financial measures
(“Non-GAAP”) and should be read along with the accompanying tables,
which provide a reconciliation of Non-GAAP financial measures to
GAAP financial measures. SmartFinancial management uses several
Non-GAAP financial measures and ratios derived therefrom in its
analysis of the Company's performance, including:
(i) Operating earnings
(ii)
Operating noninterest income
(iii)
Operating noninterest expense
(iv)
Operating pre-provision net revenue
(“PPNR”) earnings
(v)
Tangible common equity
(vi)
Average tangible common equity
(vii)
Tangible book value per common share
(viii)
Tangible assets
(ix)
Operating efficiency ratio
Operating earnings, operating noninterest income, operating
noninterest expense and operating PPNR earnings exclude
non-operating related income and expense items from net income,
noninterest income and noninterest expense, respectively. Tangible
common equity and average tangible common equity exclude goodwill
and other intangible assets from shareholders' equity and average
shareholders' equity, respectively. Tangible book value per common
share is tangible common equity divided by common shares
outstanding. Tangible assets excludes goodwill and other
intangibles from total assets. Operating efficiency ratio is the
quotient of operating noninterest expense divided by the sum of net
interest income adjusted for taxable equivalent yields plus
operating noninterest income. A detailed reconciliation of these
items and the ratios derived therefrom is available in the Non-GAAP
reconciliations.
Management believes that Non-GAAP financial measures provide
additional useful information that allows investors to evaluate the
ongoing performance of the company and provide meaningful
comparisons to its peers. Management also believes these Non-GAAP
financial measures enhance investors' ability to compare
period-to-period financial results and allow investors and company
management to view our operating results excluding the impact of
items that are not reflective of the underlying operating
performance.
Non-GAAP financial measures should not be considered as an
alternative to any measure of performance or financial condition as
promulgated under GAAP, and investors should consider
SmartFinancial's performance and financial condition as reported
under GAAP and all other relevant information when assessing the
performance or financial condition of the company. Non-GAAP
financial measures have limitations as analytical tools, and
investors should not consider them in isolation or as a substitute
for analysis of the results or financial condition as reported
under GAAP.
Forward-Looking Statements
This news release may contain statements that are based on
management’s current estimates or expectations of future events or
future results, and that may be deemed to constitute
forward-looking statements as defined under the Private Securities
Litigation Reform Act of 1995. These statements are not historical
in nature and can generally be identified by such words as
“expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “may,”
“estimate,” and similar expressions. All forward-looking statements
are subject to risks, uncertainties, and other factors that may
cause the actual results of SmartFinancial to differ materially
from future results expressed or implied by such forward-looking
statements. Such risks, uncertainties, and other factors include,
among others,
(1)
risks associated with our growth strategy,
including a failure to implement our growth plans or an inability
to manage our growth effectively;
(2)
claims and litigation arising from our
business activities and from the companies we acquire, which may
relate to contractual issues, environmental laws, fiduciary
responsibility, and other matters;
(3)
general risks related to our merger and
acquisition activity, including risks associated with our pursuit
of future acquisitions;
(4)
changes in management’s plans for the
future;
(5)
prevailing, or changes in, economic or
political conditions (including those resulting from the new
administration and Congress), particularly in our market areas,
including the effects of declines in the real estate market, high
unemployment rates, inflationary pressures, elevated interest rates
and slowdowns in economic growth, as well as the financial stress
on borrowers as a result of the foregoing;
(6)
our ability to anticipate interest rate
changes and manage interest rate risk (including the impact of
higher interest rates on macroeconomic conditions, competition, and
the cost of doing business and the impact of interest rate
fluctuations on our financial projections, models and
guidance);
(7)
increased technology and cybersecurity
risks, including generative artificial intelligence risks;
(8)
credit risk associated with our lending
activities;
(9)
changes in loan demand, real estate
values, or competition;
(10)
developments in our mortgage banking
business, including loan modifications, general demand, and the
effects of judicial or regulatory requirements or guidance;
(11)
changes in accounting principles,
policies, or guidelines;
(12)
changes in applicable laws, rules, or
regulations;
(13)
adverse results from current or future
litigation, regulatory examinations or other legal and/or
regulatory actions;
(14)
potential impacts of any adverse
developments in the banking industry, including the impacts on
customer confidence, deposit outflows, liquidity and the regulatory
response thereto;
(15)
significant turbulence or a disruption in
the capital or financial markets and the effect of a fall in stock
market prices on our investment securities;
(16)
the effects of war or other conflicts
including the impacts related to or resulting from Russia’s
military action in Ukraine or the conflict in Israel and
surrounding areas; and
(17)
other general competitive, economic,
political, and market factors, including those affecting our
business, operations, pricing, products, or services.
These and other factors that could cause results to differ
materially from those described in the forward-looking statements
can be found in SmartFinancial’s most recent annual report on Form
10-K, quarterly reports on Form 10-Q, and current reports on Form
8-K, in each case filed with or furnished to the Securities and
Exchange Commission (the “SEC”) and available on the SEC’s website
(www.sec.gov). Undue reliance should not be placed on
forward-looking statements. SmartFinancial disclaims any obligation
to update or revise any forward-looking statements contained in
this release, which speak only as of the date hereof, whether as a
result of new information, future events, or otherwise.
SmartFinancial, Inc. and
Subsidiary
Condensed Consolidated Financial
Information - (unaudited)
(dollars in thousands)
Ending Balances
Dec
Sep
Jun
Mar
Dec
2024
2024
2024
2024
2023
Assets:
Cash and cash equivalents
$
387,570
$
192,914
$
342,835
$
477,941
$
352,271
Securities available-for-sale, at fair
value
482,328
501,336
500,821
474,347
408,410
Securities held-to-maturity, at amortized
cost
126,659
127,779
128,996
180,169
281,236
Other investments
14,740
20,352
13,780
13,718
13,662
Loans held for sale
5,996
5,804
3,103
4,861
4,418
Loans and leases
3,906,340
3,717,478
3,574,158
3,477,555
3,444,462
Less: Allowance for credit losses
(37,423
)
(35,609
)
(34,690
)
(34,203
)
(35,066
)
Loans and leases, net
3,868,917
3,681,869
3,539,468
3,443,352
3,409,396
Premises and equipment, net
91,093
91,055
91,315
92,694
92,963
Other real estate owned
179
179
688
696
517
Goodwill and other intangibles, net
104,723
105,324
105,929
106,537
107,148
Bank owned life insurance
115,917
105,025
84,483
83,957
83,434
Other assets
77,782
77,297
79,591
76,418
75,932
Total assets
$
5,275,904
$
4,908,934
$
4,891,009
$
4,954,690
$
4,829,387
Liabilities:
Deposits:
Noninterest-bearing demand
$
965,552
$
863,949
$
903,300
$
907,254
$
898,044
Interest-bearing demand
836,731
834,207
988,057
996,298
1,006,915
Money market and savings
2,039,560
1,854,777
1,901,281
1,952,410
1,812,427
Time deposits
844,640
769,558
524,018
538,159
550,468
Total deposits
4,686,483
4,322,491
4,316,656
4,394,121
4,267,854
Borrowings
8,135
8,997
12,732
9,849
13,078
Subordinated debt
39,684
39,663
42,142
42,120
42,099
Other liabilities
50,141
48,760
47,014
41,804
46,470
Total liabilities
4,784,443
4,419,911
4,418,544
4,487,894
4,369,501
Shareholders' Equity:
Common stock
16,926
16,926
16,926
17,057
16,989
Additional paid-in capital
294,269
293,909
293,586
296,061
295,699
Retained earnings
203,824
195,537
187,751
181,103
173,105
Accumulated other comprehensive loss
(23,671
)
(17,349
)
(25,798
)
(27,425
)
(25,907
)
Total shareholders' equity attributable to
SmartFinancial Inc. and Subsidiary
491,348
489,023
472,465
466,796
459,886
Non-controlling interest - preferred stock
of subsidiary
113
—
—
—
—
Total shareholders' equity
491,461
489,023
472,465
466,796
459,886
Total liabilities & shareholders'
equity
$
5,275,904
$
4,908,934
$
4,891,009
$
4,954,690
$
4,829,387
SmartFinancial, Inc. and
Subsidiary
Condensed Consolidated Financial
Information - (unaudited)
(dollars in thousands except share and
per share data)
Three Months Ended
Year Ended
Dec
Sep
Jun
Mar
Dec
Dec
Dec
2024
2024
2024
2024
2023
2024
2023
Interest income:
Loans and leases, including fees
$
57,951
$
54,738
$
50,853
$
50,020
$
48,767
$
213,562
$
186,479
Investment securities:
Taxable
5,050
5,233
5,320
4,548
4,344
20,151
16,665
Tax-exempt
351
350
353
352
352
1,406
1,418
Federal funds sold and other earning
assets
2,744
3,635
4,759
4,863
4,032
16,000
13,481
Total interest income
66,096
63,956
61,285
59,783
57,495
251,119
218,043
Interest expense:
Deposits
27,437
27,350
27,439
27,035
24,926
109,260
84,260
Borrowings
89
709
148
128
162
1,075
936
Subordinated debt
787
865
884
899
890
3,434
2,767
Total interest expense
28,313
28,924
28,471
28,062
25,978
113,769
87,963
Net interest income
37,783
35,032
32,814
31,721
31,517
137,350
130,080
Provision for credit losses
2,135
2,575
883
(440
)
1,571
5,153
3,029
Net interest income after provision for
credit losses
35,648
32,457
31,931
32,161
29,946
132,197
127,051
Noninterest income:
Service charges on deposit accounts
1,778
1,780
1,692
1,612
1,673
6,862
6,511
Gain (loss) on sale of securities, net
64
—
—
—
—
64
(6,801
)
Mortgage banking
541
410
348
280
227
1,579
1,040
Investment services
1,382
1,881
1,302
1,380
1,339
5,945
5,105
Insurance commissions
1,832
1,477
1,284
1,103
1,133
5,696
4,684
Interchange and debit card transaction
fees
1,332
1,349
1,343
1,253
1,370
5,277
5,457
Other
2,101
2,242
1,635
2,752
1,837
8,729
6,329
Total noninterest income
9,030
9,139
7,604
8,380
7,579
34,152
22,325
Noninterest expense:
Salaries and employee benefits
19,752
18,448
17,261
16,639
16,275
72,100
65,749
Occupancy and equipment
3,473
3,423
3,324
3,396
3,378
13,617
13,451
FDIC insurance
825
825
825
915
915
3,390
3,156
Other real estate and loan related
expense
1,241
460
538
584
781
2,823
2,397
Advertising and marketing
397
327
295
302
336
1,321
1,342
Data processing and technology
2,495
2,519
2,452
2,465
2,458
9,930
9,235
Professional services
1,017
1,201
1,064
924
1,136
4,207
3,443
Amortization of intangibles
601
604
608
612
643
2,425
2,624
Merger related and restructuring
expenses
—
—
—
—
—
—
110
Other
2,490
3,039
2,834
2,716
3,773
11,077
11,643
Total noninterest expense
32,291
30,846
29,201
28,553
29,695
120,890
113,150
Income before income taxes
12,387
10,750
10,334
11,988
7,830
45,459
36,226
Income tax expense
2,747
1,610
2,331
2,630
1,640
9,318
7,633
Net income
$
9,640
$
9,140
$
8,003
$
9,358
$
6,190
$
36,141
$
28,593
Earnings per common share:
Basic
$
0.58
$
0.55
$
0.48
$
0.56
$
0.37
$
2.16
$
1.70
Diluted
$
0.57
$
0.54
$
0.48
$
0.55
$
0.37
$
2.14
$
1.69
Weighted average common shares
outstanding:
Basic
16,729,509
16,726,658
16,770,819
16,849,735
16,814,647
16,768,956
16,805,068
Diluted
16,863,780
16,839,998
16,850,250
16,925,408
16,918,234
16,875,456
16,911,185
SmartFinancial, Inc. and
Subsidiary
Condensed Consolidated Financial
Information - (unaudited)
(dollars in thousands)
YIELD ANALYSIS
Three Months Ended
December 31, 2024
September 30, 2024
December 31, 2023
Average
Yield/
Average
Yield/
Average
Yield/
Balance
Interest
Cost
Balance
Interest
Cost
Balance
Interest
Cost
Assets:
Loans and leases, including fees1
$
3,830,301
$
58,188
6.04
%
$
3,634,808
$
54,993
6.02
%
$
3,408,430
$
48,767
5.68
%
Taxable securities
554,152
5,050
3.63
%
564,978
5,233
3.68
%
618,511
4,344
2.79
%
Tax-exempt securities2
63,309
444
2.79
%
63,561
443
2.77
%
63,767
445
2.77
%
Federal funds sold and other earning
assets
233,793
2,745
4.67
%
267,252
3,634
5.41
%
289,896
4,032
5.52
%
Total interest-earning assets
4,681,555
66,427
5.64
%
4,530,599
64,303
5.65
%
4,380,604
57,588
5.22
%
Noninterest-earning assets
407,695
381,306
386,202
Total assets
$
5,089,250
$
4,911,905
$
4,766,806
Liabilities and Shareholders’
Equity:
Interest-bearing demand deposits
$
826,750
3,775
1.82
%
$
925,307
5,289
2.27
%
$
974,637
5,631
2.29
%
Money market and savings deposits
1,923,265
14,830
3.07
%
1,917,301
16,608
3.45
%
1,764,826
14,556
3.27
%
Time deposits
861,211
8,832
4.08
%
560,699
5,453
3.87
%
556,996
4,739
3.38
%
Total interest-bearing deposits
3,611,226
27,437
3.02
%
3,403,307
27,350
3.20
%
3,296,459
24,926
3.00
%
Borrowings
9,145
89
3.87
%
53,592
709
5.26
%
13,420
162
4.79
%
Subordinated debt
39,672
787
7.89
%
40,846
865
8.42
%
42,087
890
8.39
%
Total interest-bearing liabilities
3,660,043
28,313
3.08
%
3,497,745
28,924
3.29
%
3,351,966
25,978
3.07
%
Noninterest-bearing deposits
889,151
884,938
915,259
Other liabilities
50,884
50,580
50,055
Total liabilities
4,600,078
4,433,263
4,317,280
Shareholders' equity
489,172
478,642
449,526
Total liabilities and shareholders'
equity
$
5,089,250
$
4,911,905
$
4,766,806
Net interest income, taxable
equivalent
$
38,114
$
35,379
$
31,610
Interest rate spread
2.57
%
2.36
%
2.14
%
Tax equivalent net interest margin
3.24
%
3.11
%
2.86
%
Percentage of average interest-earning
assets to average interest-bearing liabilities
127.91
%
129.53
%
130.69
%
Percentage of average equity to average
assets
9.61
%
9.74
%
9.43
%
1 Yields computed on tax-exempt loans on a
tax equivalent basis include $237 thousand, $255 thousand, and $0
thousand of taxable equivalent income for the quarters ended
December 31, 2024, September 30, 2024, and December 31, 2023,
respectively.
2 Yields computed on tax-exempt instruments on a tax equivalent
basis include $93 thousand, $93 thousand, and $94 thousand of
taxable equivalent income for the quarters ended December 31, 2024,
September 30, 2024, and December 31, 2023, respectively.
SmartFinancial, Inc. and
Subsidiary
Condensed Consolidated Financial
Information - (unaudited)
(dollars in thousands)
YIELD ANALYSIS
Year Ended
December 31, 2024
December 31, 2023
Average
Yield/
Average
Yield/
Balance
Interest
Cost
Balance
Interest
Cost
Assets:
Loans and leases, including fees1
$
3,607,558
$
214,310
5.94
%
$
3,334,523
$
186,479
5.59
%
Taxable securities
580,001
20,151
3.47
%
713,637
16,665
2.34
%
Tax-exempt securities2
63,679
1,780
2.80
%
64,816
1,795
2.77
%
Federal funds sold and other earning
assets
300,081
16,000
5.33
%
272,864
13,481
4.94
%
Total interest-earning assets
4,551,319
252,241
5.54
%
4,385,840
218,420
4.98
%
Noninterest-earning assets
388,267
370,436
Total assets
$
4,939,586
$
4,756,276
Liabilities and Shareholders’
Equity:
Interest-bearing demand deposits
$
932,598
21,074
2.26
%
$
959,639
20,214
2.11
%
Money market and savings deposits
1,913,673
64,116
3.35
%
1,768,869
50,468
2.85
%
Time deposits
623,652
24,070
3.86
%
520,799
13,578
2.61
%
Total interest-bearing deposits
3,469,923
109,260
3.15
%
3,249,307
84,260
2.59
%
Borrowings
21,719
1,075
4.95
%
17,824
936
5.25
%
Subordinated debt
41,184
3,434
8.34
%
42,055
2,767
6.58
%
Total interest-bearing liabilities
3,532,826
113,769
3.22
%
3,309,186
87,963
2.66
%
Noninterest-bearing deposits
883,923
958,078
Other liabilities
48,949
46,052
Total liabilities
4,465,698
4,313,316
Shareholders' equity
473,888
442,960
Total liabilities and shareholders'
equity
$
4,939,586
$
4,756,276
Net interest income, taxable
equivalent
$
138,472
$
130,457
Interest rate spread
2.32
%
2.32
%
Tax equivalent net interest margin
3.04
%
2.97
%
Percentage of average interest-earning
assets to average interest-bearing liabilities
128.83
%
132.54
%
Percentage of average equity to average
assets
9.59
%
9.31
%
1 Yields computed on tax-exempt loans on a
tax equivalent basis included $749 thousand and $0 thousand of
taxable equivalent income for the year ended December 31, 2024, and
2023, respectively.
2 Yields computed on tax-exempt instruments on a tax equivalent
basis included $374 thousand and $377 thousand of taxable
equivalent income for the year ended December 31, 2024, and 2023,
respectively.
SmartFinancial, Inc. and
Subsidiary
Condensed Consolidated Financial
Information - (unaudited)
(dollars in thousands)
As of and for The Three Months
Ended
Dec
Sep
Jun
Mar
Dec
2024
2024
2024
2024
2023
Composition of Loans and
Leases:
Commercial real estate:
Owner occupied
$
867,678
$
868,077
$
829,085
$
804,557
$
798,416
Non-owner occupied
1,080,404
1,031,708
986,278
938,648
940,789
Commercial real estate, total
1,948,082
1,899,785
1,815,363
1,743,205
1,739,205
Commercial & industrial
775,620
731,600
701,460
667,903
645,918
Construction & land development
361,735
315,006
294,575
321,860
327,185
Consumer real estate
741,836
690,504
678,331
659,209
649,867
Leases
64,878
67,052
70,299
71,909
68,752
Consumer and other
14,189
13,531
14,130
13,469
13,535
Total loans and leases
$
3,906,340
$
3,717,478
$
3,574,158
$
3,477,555
$
3,444,462
Asset Quality and Additional Loan
Data:
Nonperforming loans and leases
$
7,872
$
9,491
$
6,642
$
6,266
$
8,101
Other real estate owned
179
179
688
696
517
Other repossessed assets
2,037
2,949
2,645
2,033
1,117
Total nonperforming assets
$
10,088
$
12,619
$
9,975
$
8,995
$
9,735
Modified loans and leases1 not included in
nonperforming loans and leases
$
3,989
$
4,053
$
4,241
$
4,413
$
4,245
Net charge-offs to average loans and
leases (annualized)
0.02
%
0.15
%
0.05
%
0.09
%
0.04
%
Allowance for credit losses to loans and
leases
0.96
%
0.96
%
0.97
%
0.98
%
1.02
%
Nonperforming loans and leases to total
loans and leases, gross
0.20
%
0.26
%
0.19
%
0.18
%
0.24
%
Nonperforming assets to total assets
0.19
%
0.26
%
0.20
%
0.18
%
0.20
%
Capital Ratios:
Equity to Assets
9.32
%
9.96
%
9.66
%
9.42
%
9.52
%
Tangible common equity to tangible assets
(Non-GAAP)2
7.48
%
7.99
%
7.66
%
7.43
%
7.47
%
SmartFinancial, Inc.3
Tier 1 leverage
8.33
%
8.44
%
8.32
%
8.23
%
8.27
%
Common equity Tier 1
9.83
%
10.06
%
10.06
%
10.20
%
10.14
%
Tier 1 capital
9.83
%
10.06
%
10.06
%
10.20
%
10.14
%
Total capital
11.17
%
11.62
%
11.68
%
11.85
%
11.78
%
SmartBank
Estimated4
Tier 1 leverage
8.98
%
9.17
%
9.11
%
9.07
%
9.18
%
Common equity Tier 1
10.58
%
10.92
%
11.02
%
11.23
%
11.26
%
Tier 1 capital
10.58
%
10.92
%
11.02
%
11.23
%
11.26
%
Total capital
11.36
%
11.69
%
11.79
%
12.00
%
12.02
%
1 Borrowers that have experienced
financial difficulty.
2 Total common equity less intangibles divided by total assets less
intangibles. See reconciliation of Non-GAAP measures. 3 All periods
presented are estimated. 4 Current period capital ratios are
estimated as of the date of this earnings release.
SmartFinancial, Inc. and
Subsidiary
Condensed Consolidated Financial
Information - (unaudited)
(dollars in thousands except share and
per share data)
As of and for The
As of and for The
Three Months Ended
Year Ended
Dec
Sep
Jun
Mar
Dec
Dec
Dec
2024
2024
2024
2024
2023
2024
2023
Selected Performance Ratios
(Annualized):
Return on average assets
0.75
%
0.74
%
0.66
%
0.77
%
0.52
%
0.73
%
0.60
%
Return on average shareholders' equity
7.84
%
7.60
%
6.90
%
8.16
%
5.46
%
7.63
%
6.45
%
Return on average tangible common
equity¹
9.99
%
9.75
%
8.94
%
10.63
%
7.18
%
9.82
%
8.55
%
Noninterest income / average assets
0.71
%
0.74
%
0.63
%
0.69
%
0.63
%
0.69
%
0.47
%
Noninterest expense / average assets
2.52
%
2.50
%
2.41
%
2.35
%
2.47
%
2.45
%
2.38
%
Efficiency ratio
68.98
%
69.83
%
72.25
%
71.20
%
75.95
%
70.49
%
74.24
%
Operating Selected Performance Ratios
(Annualized):
Operating return on average assets1
0.75
%
0.74
%
0.64
%
0.69
%
0.57
%
0.71
%
0.72
%
Operating PPNR return on average
assets1
1.13
%
1.08
%
0.90
%
0.84
%
0.86
%
0.99
%
0.99
%
Operating return on average shareholders'
equity1
7.80
%
7.60
%
6.72
%
7.29
%
6.07
%
7.36
%
7.77
%
Operating return on average tangible
common equity1
9.94
%
9.75
%
8.70
%
9.49
%
7.98
%
9.48
%
10.29
%
Operating efficiency ratio1
68.58
%
69.28
%
72.13
%
73.50
%
73.41
%
70.72
%
70.26
%
Operating noninterest income / average
assets1
0.70
%
0.74
%
0.60
%
0.58
%
0.63
%
0.66
%
0.61
%
Operating noninterest expense / average
assets1
2.52
%
2.50
%
2.41
%
2.35
%
2.39
%
2.45
%
2.36
%
Selected Interest Rates and
Yields:
Yield on loans and leases, excluding loan
fees, FTE
5.95
%
5.95
%
5.80
%
5.71
%
5.61
%
5.86
%
5.43
%
Yield on loans and leases, FTE
6.04
%
6.02
%
5.87
%
5.82
%
5.68
%
5.94
%
5.59
%
Yield on earning assets, FTE
5.64
%
5.65
%
5.52
%
5.36
%
5.22
%
5.54
%
4.98
%
Cost of interest-bearing deposits
3.02
%
3.20
%
3.23
%
3.16
%
3.00
%
3.15
%
2.59
%
Cost of total deposits
2.43
%
2.54
%
2.56
%
2.52
%
2.35
%
2.51
%
2.00
%
Cost of interest-bearing liabilities
3.08
%
3.29
%
3.29
%
3.23
%
3.07
%
3.22
%
2.66
%
Net interest margin, FTE
3.24
%
3.11
%
2.97
%
2.85
%
2.86
%
3.04
%
2.97
%
Per Common Share:
Net income, basic
$
0.58
$
0.55
$
0.48
$
0.56
$
0.37
$
2.16
$
1.70
Net income, diluted
0.57
0.54
0.48
0.55
0.37
2.14
1.69
Operating earnings, basic¹
0.57
0.55
0.47
0.50
0.41
2.08
2.05
Operating earnings, diluted¹
0.57
0.54
0.46
0.49
0.41
2.07
2.03
Book value
29.04
28.89
27.91
27.37
27.07
29.04
27.07
Tangible book value¹
22.85
22.67
21.66
21.12
20.76
22.85
20.76
Common shares outstanding
16,925,672
16,926,374
16,925,902
17,056,704
16,988,879
16,925,672
16,988,879
1Non-GAAP measure. See reconciliation of
Non-GAAP measures.
SmartFinancial, Inc. and
Subsidiary
Condensed Consolidated Financial
Information - (unaudited)
(dollars in thousands)
NON-GAAP RECONCILIATIONS
Three Months Ended
Year Ended
Dec
Sep
Jun
Mar
Dec
Dec
Dec
2024
2024
2024
2024
2023
2024
2023
Operating Earnings:
Net income (GAAP)
$
9,641
$
9,140
$
8,003
$
9,358
$
6,190
$
36,141
$
28,593
Noninterest income:
Securities (gains) losses, net
(64
)
—
—
—
—
(64
)
6,801
Gain on sale of former branch building
—
—
(283
)
(1,346
)
—
(1,629
)
—
Noninterest expenses:
Donation of a former branch location
—
—
—
—
250
—
250
Accruals for pending litigation
—
—
—
—
675
—
675
Merger related and restructuring
expenses
—
—
—
—
—
—
110
Income taxes:
Income tax effect of adjustments
17
—
73
348
(239
)
437
(2,024
)
Operating earnings (Non-GAAP)
$
9,594
$
9,140
$
7,793
$
8,360
$
6,876
$
34,885
$
34,405
Operating earnings per common share
(Non-GAAP):
Basic
$
0.57
$
0.55
$
0.47
$
0.50
$
0.41
$
2.08
$
2.05
Diluted
0.57
0.54
0.46
0.49
0.41
2.07
2.03
Operating Noninterest Income:
Noninterest income (GAAP)
$
9,030
$
9,139
$
7,604
$
8,380
$
7,579
$
34,152
$
22,325
Securities (gains) losses, net
(64
)
—
—
—
—
(64
)
6,801
Gain on sale of former branch building
—
—
(283
)
(1,346
)
—
(1,629
)
—
Operating noninterest income
(Non-GAAP)
$
8,966
$
9,139
$
7,321
$
7,034
$
7,579
$
32,459
$
29,126
Operating noninterest income
(Non-GAAP)/average assets1
0.70
%
0.74
%
0.60
%
0.58
%
0.63
%
0.66
%
0.61
%
Operating Noninterest Expense:
Noninterest expense (GAAP)
$
32,291
$
30,846
$
29,201
$
28,553
$
29,695
$
120,890
$
113,150
Donation of a former branch location
—
—
—
—
(250
)
—
(250
)
Accruals for pending litigation
—
—
—
—
(675
)
—
(675
)
Merger related and restructuring
expenses
—
—
—
—
—
—
(110
)
Operating noninterest expense
(Non-GAAP)
$
32,291
$
30,846
$
29,201
$
28,553
$
28,770
$
120,890
$
112,115
Operating noninterest expense
(Non-GAAP)/average assets2
2.52
%
2.50
%
2.41
%
2.35
%
2.39
%
2.45
%
2.36
%
Operating Pre-provision Net revenue
("PPNR") Earnings:
Net interest income (GAAP)
$
37,783
$
35,032
$
32,814
$
31,721
$
31,517
$
137,350
$
130,080
Operating noninterest income
(Non-GAAP)
8,966
9,139
7,321
7,034
7,579
32,459
29,126
Operating noninterest expense
(Non-GAAP)
(32,291
)
(30,846
)
(29,201
)
(28,553
)
(28,770
)
(120,890
)
(112,115
)
Operating PPNR earnings (Non-GAAP)
$
14,458
$
13,325
$
10,934
$
10,202
$
10,326
$
48,919
$
47,091
Non-GAAP Return Ratios:
Operating return on average assets
(Non-GAAP)3
0.75
%
0.74
%
0.64
%
0.69
%
0.57
%
0.71
%
0.72
%
Operating PPNR return on average assets
(Non-GAAP)4
1.13
%
1.08
%
0.90
%
0.84
%
0.86
%
0.99
%
0.99
%
Return on average tangible common equity
(Non-GAAP)5
9.99
%
9.75
%
8.93
%
10.63
%
7.18
%
9.82
%
8.55
%
Operating return on average shareholders'
equity (Non-GAAP)6
7.80
%
7.60
%
6.72
%
7.29
%
6.07
%
7.36
%
7.77
%
Operating return on average tangible
common equity (Non-GAAP)7
9.94
%
9.75
%
8.70
%
9.49
%
7.98
%
9.48
%
10.29
%
Operating Efficiency Ratio:
Efficiency ratio (GAAP)
68.98
%
69.83
%
72.25
%
71.20
%
75.95
%
70.49
%
74.24
%
Adjustment for taxable equivalent
yields
(0.49
)%
(0.55
)%
(0.63
)%
(0.17
)%
(0.18
)%
(0.46
)%
(0.18
)%
Adjustment for securities gains
(losses)
0.09
%
—
%
—
%
—
%
—
%
0.03
%
(3.17
)%
Adjustment for sale of branch location
—
%
—
%
0.51
%
2.46
%
—
%
0.66
%
—
%
Adjustment for donation of a former branch
location
—
%
—
%
—
%
—
%
(0.64
)%
—
%
(0.16
)%
Adjustment for accruals for pending
litigation
—
%
—
%
—
%
—
%
(1.72
)%
—
%
(0.44
)%
Adjustment for merger related income and
costs
—
%
—
%
—
%
—
%
—
%
—
%
(0.03
)%
Operating efficiency ratio (Non-GAAP)
68.58
%
69.28
%
72.13
%
73.50
%
73.41
%
70.72
%
70.26
%
1Operating noninterest income (Non-GAAP)
is annualized and divided by average assets.
2Operating noninterest expense (Non-GAAP)
is annualized and divided by average assets.
3Operating return on average assets
(Non-GAAP) is the annualized operating earnings (Non-GAAP) divided
by average assets.
4Operating PPNR return on average assets
(Non-GAAP) is the annualized operating PPNR earnings (Non-GAAP)
divided by average assets.
5Return on average tangible common equity
(Non-GAAP) is the annualized net income divided by average tangible
common equity (Non-GAAP).
6Operating return on average shareholders’
equity (Non-GAAP) is the annualized operating earnings (Non-GAAP)
divided by average equity.
7Operating return on average tangible
common equity (Non-GAAP) is the annualized operating earnings
(Non-GAAP) divided by average tangible common equity
(Non-GAAP).
SmartFinancial, Inc. and
Subsidiary
Condensed Consolidated Financial
Information - (unaudited)
(dollars in thousands)
NON-GAAP RECONCILIATIONS
Three Months Ended
Dec
Sep
Jun
Mar
Dec
2024
2024
2024
2024
2023
Tangible Common Equity:
Shareholders' equity (GAAP)
$
491,461
$
489,023
$
472,465
$
466,796
$
459,886
Less goodwill and other intangible
assets
104,723
105,324
105,929
106,537
107,148
Tangible common equity (Non-GAAP)
$
386,738
$
383,699
$
366,536
$
360,259
$
352,738
Average Tangible Common Equity:
Average shareholders' equity (GAAP)
$
489,172
$
478,642
$
466,371
$
461,148
$
449,526
Less average goodwill and other intangible
assets
105,093
105,701
106,301
106,920
107,551
Average tangible common equity
(Non-GAAP)
$
384,079
$
372,941
$
360,070
$
354,228
$
341,975
Tangible Book Value per Common
Share:
Book value per common share (GAAP)
$
29.04
$
28.89
$
27.91
$
27.37
$
27.07
Adjustment due to goodwill and other
intangible assets
(6.19
)
(6.22
)
(6.25
)
(6.25
)
(6.31
)
Tangible book value per common share
(Non-GAAP)1
$
22.85
$
22.67
$
21.66
$
21.12
$
20.76
Tangible Common Equity to Tangible
Assets:
Total Assets (GAAP)
$
5,275,904
$
4,908,934
$
4,891,009
$
4,954,690
$
4,829,387
Less goodwill and other intangibles
104,723
105,324
105,929
106,537
107,148
Tangible Assets (Non-GAAP)
$
5,171,181
$
4,803,610
$
4,785,080
$
4,848,153
$
4,722,239
Tangible common equity to tangible assets
(Non-GAAP)
7.48
%
7.99
%
7.66
%
7.43
%
7.47
%
1 Tangible book value per share (Non-GAAP)
is computed by dividing total shareholders’ equity, less goodwill
and other intangible assets, by common shares outstanding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250121337466/en/
Investor Contacts
Billy Carroll President & Chief Executive Officer Email:
billy.carroll@smartbank.com Phone: (865) 868-0613
Nathan Strall Vice President and Director of Strategy &
Corporate Development Email: nathan.strall@smartbank.com Phone:
(865) 868-2604
SmartFinancial (NYSE:SMBK)
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SmartFinancial (NYSE:SMBK)
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