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CST: 06/12/2019 16:59:17   

Origin Bancorp, Inc. Reports Earnings for Third Quarter 2019

44 Days ago

RUSTON, La., Oct. 23, 2019 (GLOBE NEWSWIRE) -- Origin Bancorp, Inc. (Nasdaq: OBNK) ("Origin" or the "Company"), the holding company for Origin Bank (the "Bank"), today announced net income of $14.6 million for the quarter ended September 30, 2019. This represents an increase of $2.3 million from the quarters ended June 30, 2019, and September 30, 2018. Diluted earnings per share for the quarter ended September 30, 2019, was $0.62, up $0.10 from both the linked quarter and the quarter ended September 30, 2018.

"We are pleased to report another record quarter with record net income and net interest income," said Drake Mills, Chairman, President and CEO of Origin Bancorp, Inc. "We continue to see successful organic loan and deposit growth across our markets. Our team delivered outstanding noninterest-bearing deposit growth which contributed to lower total deposit costs. We believe robust loan demand, strong loan pipelines and a proven strategy for growing low-cost core deposits should position us for success as we navigate the current interest rate environment."

Third Quarter 2019 Summary

  • Net interest income reached a historical quarterly high of $44.6 million for the quarter ended September 30, 2019, compared to $43.0 million for the quarter ended June 30, 2019, and $39.5 million for the quarter ended September 30, 2018.
  • Noninterest income also reached a historical quarterly high of $12.9 million for the quarter ended September 30, 2019, compared to $11.2 million for the quarter ended June 30, 2019, and $10.2 million for the quarter ended September 30, 2018.
  • Total loans held for investment were $4.19 billion, an increase of $203.9 million, or 5.1%, from June 30, 2019, and an increase of $587.4 million, or 16.3%, from September 30, 2018. The yield earned on total loans held for investment during the quarter ended September 30, 2019, was 5.23%, compared to 5.29% for the linked quarter and 5.00% for the quarter ended September 30, 2018.
  • Total deposits increased by $429.3 million, or 11.1%, from June 30, 2019, and increased by $557.2 million, or 14.9%, from September 30, 2018. Noninterest-bearing deposits increased by $151.2 million, or 15.1%, compared to the linked quarter, and increased by $178.4 million, or 18.3%, from September 30, 2018. The average rate paid on interest-bearing deposits was 1.59% compared to 1.61% for the linked quarter and 1.16% for the quarter ended September 30, 2018.
  • Nonperforming loans held for investment to total loans held for investment was 0.75% at September 30, 2019, compared to 0.76% at June 30, 2019, and 0.74% at September 30, 2018.
  • Net charge-offs for the quarter ended September 30, 2019, were $3.0 million compared to $677,000 for the quarter ended June 30, 2019, largely driven by a $3.0 million charge-off of a single commercial loan relationship.
  • Our efficiency ratio was 60.98% for the quarter ended September 30, 2019, compared to 68.51% and 69.06% for the quarters ended June 30, 2019, and September 30, 2018, respectively.

Results of Operations for the Three Months Ended September 30, 2019

Net Interest Income and Net Interest Margin

Net interest income for the quarter ended September 30, 2019, was $44.6 million, reflecting an increase of $1.7 million, or 3.8%, compared to the linked quarter. The increase was primarily driven by increases in the average balance of loans held for investment, and was partially offset by declines in the yield on loans held for investment and declines in the average balances and yields of investment securities. In addition, the third quarter of 2019 was positively impacted by an additional day in the current quarter.

Interest-bearing deposit expense remained stable, increasing marginally to $11.6 million compared to $11.5 million for the quarter ended June 30, 2019. The increase included a $126,000 expense that was driven by an additional day in the current quarter (as mentioned above) and a $69,000 expense that was driven by an increase in the average balance of interest-bearing deposits compared to the linked quarter. These increases were partially offset by a $112,000 decline in the rate paid on outstanding balances. Average noninterest-bearing deposits increased by $58.3 million, or 5.7%, compared to the linked quarter and by $92.0 million, or 9.3%, compared to September 30, 2018.

The fully tax-equivalent net interest margin ("NIM") was 3.69% for the third quarter of 2019, a one basis point decrease from the second quarter of 2019 and a seven basis point decrease from the third quarter of 2018. The net interest spread was reduced by one basis point and 16 basis points, respectively, when compared to the three months ended June 30, 2019, and the three months ended September 30, 2018. The decrease in the net interest spread compared to the three months ended September 30, 2018, was due primarily to deposit pricing pressures which were partially offset by the lower cost of borrowings. The rate paid on total interest-bearing liabilities for the quarter ended September 30, 2019, was 1.65%, representing a decrease of three basis points and an increase of 39 basis points compared to the linked quarter and the quarter ended September 30, 2018, respectively. The yield earned on interest-earning assets decreased four basis points and increased 23 basis points compared to the linked quarter and the quarter ended September 30, 2018, respectively. The decline in asset yields on a linked quarter basis was primarily caused by declining loan yields, which decreased by five basis points, driven by an interest rate cut by the Federal Reserve in August 2019. The reduction in asset yields caused by loan yield declines was partially offset by an asset mix change during the third quarter, with loans comprising a higher percentage of interest-earning assets when compared to the linked quarter. The Company expects that the impact of the Federal Reserve's September rate cut will be realized more fully in the fourth quarter of 2019.

Noninterest Income

Noninterest income for the quarter ended September 30, 2019, was $12.9 million, an increase of $1.7 million, or 15.2%, from the linked quarter. The increase in noninterest income over the linked quarter was primarily driven by increases of $1.2 million and $697,000 in swap fee income and limited partnership investment income, respectively. These increases were partially offset by a $367,000 decline in the change in fair value of equity investments. During the third quarter of 2019, the Company saw robust growth in service charges and fees driven by treasury management customers, with a 5.4% increase on a linked quarter basis.

Swap fee income during the third quarter was driven by the increased volume of new transactions compared to the linked quarter. Given the low interest rate environment, customers have the opportunity to lock in fixed rates through swaps, driving increases in swap fees. The increase in limited partnership investment income was driven by favorable valuation adjustments to certain limited partnership investments during the third quarter.

Noninterest Expense

Noninterest expense for the quarter ended September 30, 2019, was $35.1 million, a decrease of $2.0 million, or 5.5%, compared to the linked quarter. The decrease from the linked quarter included decreases of $1.2 million, $1.1 million and $236,000 in salaries and employee benefits, regulatory assessments and communications expenses, respectively. The decrease in salaries and employee benefits was driven by a $1.2 million reduction in self-insured medical expenses in the current quarter compared to the linked quarter, which was caused by large claims recorded during the second quarter of 2019, that were later partially released at a lower expense to the Company, resulting in a release in reserve of $570,000 during the current quarter. During the current quarter the Company recorded an FDIC assessment credit of approximately $1.0 million from the FDIC insurance fund. The Company's communications expenses in the third quarter were also favorably impacted by a $150,000 over billing credit from a legacy service provider. Partially offsetting the net decrease in noninterest expense were increases of $525,000 and $191,000 in loan related expenses and franchise tax expense, respectively. The increase in loan related expenses was primarily due to $441,000 in legal costs incurred in connection with two nonperforming loan relationships. In September 2019, the Company recorded a true-up of $213,000 after the completion of franchise tax returns for several states based on the 2018 tax year.

Financial Condition

Loans

Total loans held for investment at September 30, 2019, were $4.19 billion, an increase of $203.9 million, or 5.1%, compared to $3.98 billion at June 30, 2019, and an increase of $587.4 million, or 16.3%, compared to $3.60 billion at September 30, 2018. A significant portion of our loan growth continues to come from the Texas market.

For the quarter ended September 30, 2019, average loans held for investment were $4.07 billion, an increase of $177.0 million, or 4.6%, from $3.89 billion for the linked quarter. The quarter over quarter change reflected growth in all loan categories.

Deposits

Total deposits at September 30, 2019, were $4.28 billion, an increase of $429.3 million, or 11.1%, compared to $3.86 billion at June 30, 2019, and an increase of $557.2 million, or 14.9%, compared to $3.73 billion, at September 30, 2018. Brokered deposits contributed an increase of $166.2 million, or 38.7%, of the linked quarter increase and $51.6 million, or 9.3%, of the increase when compared to the same quarter in 2018.

Average total deposits for the quarter ended September 30, 2019, increased by $78.8 million, or 2.0%, over the linked quarter, led by increases of $113.7 million and $50.7 million and in average business deposits and average consumer deposits, respectively. These increases were partially offset by declines of $74.0 million and $26.6 million in average brokered deposits and average public fund deposits, respectively.

For the quarter ended September 30, 2019, average noninterest-bearing deposits as a percentage of total average deposits was 27.1%, compared to 26.1% for the quarter ended June 30, 2019, and 26.7% for the quarter ended September 30, 2018.

Borrowings

Average borrowings for the quarter ended September 30, 2019, increased by $39.7 million, or 9.1%, over the quarter ended June 30, 2019, and increased by $271.3 million, or 132.6% over the quarter ended September 30, 2018. The increase in average borrowings in the third quarter of 2019 compared to the linked quarter was driven by a $100.0 million long-term advance obtained from the Federal Home Loan Bank ("FHLB") during the third quarter. The advance bears interest at 35 basis points, has a 15 year fixed maturity and is callable quarterly at the option of the FHLB. The increase in third quarter average borrowings compared to the quarter ended September 30, 2018, was largely driven by the same $100.0 million FHLB advance and a $250.0 million advance obtained in the second quarter of 2019.

Stockholders' Equity

Stockholders' equity was $588.4 million at September 30, 2019, compared to $584.3 million and $531.9 million at June 30, 2019, and September 30, 2018, respectively. Net income of $14.6 million and other comprehensive income of $1.1 million for the three months ended September 30, 2019, were the primary drivers of the increase in stockholders' equity compared to June 30, 2019, and were partially offset by the $10.1 million repurchase of the Company's common stock and the dividend paid on the Company's common stock that occurred during the third quarter. The Company increased the dividend to $0.0925 from $0.0325 during the third quarter of 2019. Through dividends and share repurchases, we have returned $13.8 million to shareholders in 2019, with $12.3 million of that in the third quarter alone.

Credit Quality

The Company recorded provision expense of $4.2 million for the quarter ended September 30, 2019, compared to provision expense of $2.0 million for the linked quarter and $504,000 for the quarter ended September 30, 2018. The increase in provision expense from the linked quarter was primarily driven by an increase in charge-offs and, to a lesser extent, an increase in the general reserve due to growth in the loan portfolio. During the quarter ended September 30, 2019, the Company had net charge-offs of $3.0 million compared to net charge-offs of $677,000 for the linked quarter. The increase was driven by a $3.0 million write down of a single commercial loan relationship. The relationship is in the restaurant industry, and the Company has a remaining exposure in the industry of $73.0 million, or 1.7% of total loans at September 30, 2019. The Company's net charge-off ratio for the nine months ended September 30, 2019, is 0.11%, compared to 0.04% during the same period in 2018. Total nonperforming loans held for investment were $31.5 million at September 30, 2019, compared to $30.5 million and $26.6 million at June 30, 2019, and September 30, 2018, respectively.

Allowance for loan losses as a percentage of total loans held for investment was 0.89% at September 30, 2019, compared to 0.92% and 0.99% at June 30, 2019, and September 30, 2018, respectively. Allowance for loan losses as a percentage of nonperforming loans held for investment was 117.97% at September 30, 2019, compared to 120.36% and 134.54% at June 30, 2019, and September 30, 2018, respectively.

Total past due loans held for investment, defined as loans 30 days past due or more, as a percentage of loans held for investment was 0.72% at September 30, 2019, compared to 0.80% at June 30, 2019, and 0.69% at September 30, 2018.

Conference Call

Origin will hold a conference call to discuss its third quarter 2019 results on Thursday, October 24, 2019, at 8:00 a.m. Central Time (9:00 a.m. Eastern Time). To participate in the live conference call, please dial (844) 695-5516; International: (412) 902-6750 and request to be joined into the Origin Bancorp Inc. (OBNK) call. A simultaneous audio-only webcast may be accessed via Origin's website at www.origin.bank under the Investor Relations, News & Events, Events & Presentations link or directly by visiting https://services.choruscall.com/links/obnk191024.html.

If you are unable to participate during the live webcast, the webcast will be archived on the Investor Relations section of Origin's website at www.origin.bank, under Investor Relations, News & Events, Events & Presentations.

About Origin Bancorp, Inc.

Origin is a financial holding company for Origin Bank, headquartered in Ruston, Louisiana, which provides a broad range of financial services to small and medium-sized businesses, municipalities, high net-worth individuals and retail clients from 43 banking centers, located from Dallas/Fort Worth, Texas across North Louisiana to Central Mississippi, as well as in Houston, Texas. For more information, visit www.origin.bank.

Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include information regarding Origin's future financial performance, business and growth strategy, projected plans and objectives, including any expected purchases of its outstanding common stock, and related transactions and other projections based on macroeconomic and industry trends, including expectations regarding interest rate cuts by the Federal Reserve and the impact of those cuts on Origin's results of operations, and expectations regarding the Company's liquidity, including in connection with advances obtained from the FHLB, which are all subject to change and may be inherently unreliable due to the multiple factors that impact broader economic and industry trends, and any such changes may be material. Such forward-looking statements are based on various facts and derived utilizing important assumptions and current expectations, estimates and projections about Origin and its subsidiaries, any of which may change over time and some of which may be beyond Origin's control. Statements preceded by, followed by or that otherwise include the words "assuming," "believes," "expects," "anticipates," "intends," "projects," "estimates," "plans" and similar expressions or future or conditional verbs such as "will," "should," "would," "may" and "could" are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing words. Further, certain factors that could affect Origin's future results and cause actual results to differ materially from those expressed in the forward-looking statements include: deterioration of Origin's asset quality; changes in real estate values and liquidity in Origin's primary market areas; the financial health of Origin's commercial borrowers and the success of construction projects that Origin finances; changes in the value of collateral securing Origin's loans; business and economic conditions generally and in the financial services industry, nationally and within Origin's primary market areas; Origin's ability to prudently manage its growth and execute its strategy; changes in management personnel; Origin's ability to maintain important deposit customer relationships; volatility and direction of market interest rates, which may increase funding costs or reduce interest-earning asset yields thus reducing margin; increased competition in the financial services industry, particularly from regional and national institutions; difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the market areas in which Origin operates and in which its loans are concentrated, including the effects of declines in housing markets; an increase in unemployment levels and slowdowns in economic growth; Origin's level of nonperforming assets and the costs associated with resolving any problem loans including litigation and other costs; the credit risk associated with the substantial amount of commercial real estate, construction and land development, and commercial loans in Origin's loan portfolio; the extensive federal and state regulation, supervision and examination governing almost every aspect of Origin's operations including changes in regulations affecting financial institutions, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations being issued in accordance with this statute and potential expenses associated with complying with such regulations; Origin's ability to comply with applicable capital and liquidity requirements, including its ability to generate liquidity internally or raise capital on favorable terms, including continued access to the debt and equity capital markets; changes in the utility of Origin's non-GAAP liquidity measurements and its underlying assumptions or estimates; possible changes in trade, monetary and fiscal policies, laws and regulations and other activities of governments, agencies, and similar organizations; and the effects of weather and natural disasters such as floods, droughts, wind, tornadoes and hurricanes as well as effects from geopolitical instability and manmade disasters. For a discussion of these and other risks that may cause actual results to differ from expectations, please refer to the sections titled "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in Origin's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") and any updates to those sections set forth in Origin's subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if Origin's underlying assumptions prove to be incorrect, actual results may differ materially from what Origin anticipates. Accordingly, you should not place undue reliance on any forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and Origin does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, and it is not possible for Origin to predict those events or how they may affect Origin. In addition, Origin cannot assess the impact of each factor on Origin's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this communication are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Origin or persons acting on Origin's behalf may issue. Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

Contact:
Chris Reigelman, Origin Bancorp, Inc.
318-497-3177 / chris@origin.bank


Origin Bancorp, Inc.
Selected Financial Data
 
  At and for the three months ended
  September 30,
 2019
  June 30,
2019
  March 31,
2019
  December 31,
 2018
  September 30,
 2018
                   
Income statement and share amounts (Dollars in thousands, except per share amounts, unaudited)
Net interest income $ 44,622     $ 42,969     $ 42,026     $ 42,061     $ 39,497  
Provision for credit losses 4,201     1,985     1,005     1,723     504  
Noninterest income 12,880     11,176     11,604     10,588     10,237  
Noninterest expense 35,064     37,095     35,381     35,023     34,344  
Income before income tax expense 18,237     15,065     17,244     15,903     14,886  
Income tax expense 3,620     2,782     3,089     2,725     2,568  
Net income $ 14,617     $ 12,283     $ 14,155     $ 13,178     $ 12,318  
Basic earnings per common share $ 0.62     $ 0.52     $ 0.60     $ 0.56     $ 0.52  
Diluted earnings per common share 0.62     0.52     0.60     0.55     0.52  
Dividends declared per common share 0.0925     0.0325     0.0325     0.0325     0.0325  
Weighted average common shares outstanding - basic 23,408,499     23,585,040     23,569,576     23,519,778     23,493,065  
Weighted average common shares outstanding - diluted 23,606,956     23,786,646     23,776,349     23,715,919     23,716,779  
                   
Balance sheet data                  
Total loans held for investment $ 4,188,497     $ 3,984,597     $ 3,838,343     $ 3,789,105     $ 3,601,081  
Total assets 5,396,928     5,119,625     4,872,201     4,821,576     4,667,564  
Total deposits 4,284,317     3,855,012     3,898,248     3,783,138     3,727,158  
Total stockholders' equity 588,363     584,293     568,122     549,779     531,919  
                   
Performance metrics and capital ratios                  
Yield on loans held for investment 5.23 %   5.29 %   5.28 %   5.17 %   5.00 %
Yield on interest earnings assets 4.81     4.85     4.86     4.75     4.58  
Rate on interest bearing deposits 1.59     1.61     1.48     1.31     1.16  
Rate on total deposits 1.16     1.19     1.11     0.96     0.85  
Net interest margin, fully tax equivalent 3.69     3.70     3.80     3.82     3.76  
Return on average stockholders' equity (annualized) 9.85     8.54     10.25     9.66     9.15  
Return on average assets (annualized) 1.12     0.98     1.18     1.10     1.08  
Efficiency ratio (1) 60.98     68.51     65.97     66.52     69.06  
Book value per common share $ 25.06     $ 24.58     $ 23.92     $ 23.17     $ 22.52  
Common equity tier 1 to risk-weighted assets (2) 11.43 %   11.93 %   12.05 %   11.94 %   11.79 %
Tier 1 capital to risk-weighted assets (2) 11.63     12.13     12.26     12.16     12.01  
Total capital to risk-weighted assets (2) 12.45     12.97     13.10     12.98     12.88  
Tier 1 leverage ratio (2) 10.88     11.10     11.23     11.21     11.34  

____________________________
(1)  Calculated by dividing noninterest expense by the sum of net interest income plus noninterest income.
(2)  September 30, 2019, ratios are estimated and calculated at the Company level, which is subject to the capital adequacy requirements of the Federal Reserve Board.


 
Origin Bancorp, Inc.
Selected Financial Data
 
  Nine months ended September 30,
(Dollars in thousands, except per share amounts) 2019   2018
Income statement and share amounts (Unaudited)   (Unaudited)
Net interest income $ 129,617     $ 111,391  
Provision (benefit)for credit losses 7,191     (709 )
Noninterest income 35,660     30,652  
Noninterest expense 107,540     96,213  
Income before income tax expense 50,546     46,539  
Income tax expense 9,491     8,112  
Net income $ 41,055     $ 38,427  
Basic earnings per common share (1) $ 1.75     $ 1.66  
Diluted earnings per common share(1) 1.73     1.64  
Dividends declared per common share 0.1575     0.0975  
Weighted average common shares outstanding - basic 23,520,438     21,476,801  
Weighted average common shares outstanding - diluted 23,722,384     21,700,515  
       
Performance metrics      
Yield on loans held for investment 5.26 %   4.88 %
Yield on interest earnings assets 4.84     4.45  
Rate on interest bearing deposits 1.56     1.02  
Rate on total deposits 1.15     0.76  
Net interest margin, fully tax equivalent 3.73     3.73  
Return on average stockholders' equity 9.54     10.22  
Return on average assets 1.09     1.18  
Efficiency ratio (2) 65.07     67.74  

____________________________
(1)  Due to the combined impact of the repurchase of common stock on the quarterly average common shares outstanding calculation compared to the impact of the repurchase of common stock shares on the year-to-date average common outstanding calculation, and the effect of rounding, the sum of the 2019 quarterly earnings per common share will not equal the year-to-date earnings per common share amount. Due to the impact of average preferred shares outstanding on the calculation of earnings per share for the 2018 period, the sum of quarterly periods may not agree to the amount disclosed for the 2018 year-to-date period.
(2)  Calculated by dividing noninterest expense by the sum of net interest income plus noninterest income.


 
Origin Bancorp, Inc.
Consolidated Balance Sheets
 
(Dollars in thousands) September 30,
 2019
  June 30,
 2019
  March 31,
 2019
  December 31,
 2018
  September 30,
 2018
Assets (Unaudited)   (Unaudited)   (Unaudited)       (Unaudited)
Cash and due from banks $ 79,005     $ 75,204     $ 66,312     $ 71,008     $ 60,716  
Interest-bearing deposits in banks 229,757     124,356     44,928     45,670     59,721  
Federal funds sold                 20,000  
Total cash and cash equivalents 308,762     199,560     111,240     116,678     140,437  
Securities:                  
Available for sale 492,461     548,980     563,826     575,644     585,788  
Held to maturity 28,759     28,897     19,033     19,169     19,602  
Securities carried at fair value through income 11,745     11,615     11,510     11,361     11,273  
Total securities 532,965     589,492     594,369     606,174     616,663  
Non-marketable equity securities held in other financial institutions 49,205     49,008     42,314     42,149     39,283  
Loans held for sale 67,122     58,408     42,265     52,210     50,658  
Loans 4,188,497     3,984,597     3,838,343     3,789,105     3,601,081  
Less: allowance for loan losses 37,126     36,683     35,578     34,203     35,727  
Loans, net of allowance for loan losses 4,151,371     3,947,914     3,802,765     3,754,902     3,565,354  
Premises and equipment, net 80,921     80,672     78,684     75,014     74,936  
Mortgage servicing rights 19,866     21,529     23,407     25,114     26,163  
Cash surrender value of bank-owned life insurance 37,755     33,070     32,888     32,706     32,487  
Goodwill and other intangible assets, net 31,842     32,144     32,497     32,861     33,228  
Accrued interest receivable and other assets 117,119     107,828     111,772     83,768     88,355  
Total assets $ 5,396,928     $ 5,119,625     $ 4,872,201     $ 4,821,576     $ 4,667,564  
Liabilities and Stockholders' Equity                  
Noninterest-bearing deposits $ 1,154,660     $ 1,003,499     $ 977,919     $ 951,015     $ 976,260  
Interest-bearing deposits 2,309,387     2,011,719     2,101,706     2,027,720     1,985,757  
Time deposits 820,270     839,794     818,623     804,403     765,141  
Total deposits 4,284,317     3,855,012     3,898,248     3,783,138     3,727,158  
FHLB advances and other borrowings 419,681     601,346     335,053     445,224     358,532  
Junior subordinated debentures 9,664     9,657     9,651     9,644     9,637  
Accrued expenses and other liabilities 94,903     69,317     61,127     33,791     40,318  
Total liabilities 4,808,565     4,535,332     4,304,079     4,271,797     4,135,645  
Commitments and contingencies                  
Stockholders' equity                  
Common stock 117,409     118,871     118,730     118,633     118,106  
Additional paid-in capital 235,018     243,002     242,579     242,041     240,832  
Retained earnings 229,246     216,801     205,289     191,585     179,178  
Accumulated other comprehensive income (loss) 6,690     5,619     1,524     (2,480 )   (6,197 )
Total stockholders' equity 588,363     584,293     568,122     549,779     531,919  
   Total liabilities and stockholders' equity $ 5,396,928     $ 5,119,625     $ 4,872,201     $ 4,821,576     $ 4,667,564  


 
Origin Bancorp, Inc.
Consolidated Quarterly Statements of Income
 
  Three months ended
  September 30,
 2019
  June 30,
2019
  March 31,
2019
  December 31,
 2018
  September 30,
 2018
                   
Interest and dividend income (Dollars in thousands, except per share amounts, unaudited)
Interest and fees on loans $ 53,932     $ 51,461     $ 49,175     $ 47,819     $ 43,872  
Investment securities-taxable 2,786     3,208     3,341     3,292     2,754  
Investment securities-nontaxable 826     871     858     996     1,129  
Interest and dividend income on assets held in other financial institutions 1,262     1,523     1,120     950     1,080  
Federal funds sold             1     7  
Total interest and dividend income 58,806     57,063     54,494     53,058     48,842  
Interest expense                  
Interest-bearing deposits 11,623     11,540     10,497     8,980     7,891  
FHLB advances and other borrowings 2,420     2,415     1,834     1,878     1,314  
Subordinated debentures 141     139     137     139     140  
Total interest expense 14,184     14,094     12,468     10,997     9,345  
Net interest income 44,622     42,969     42,026     42,061     39,497  
Provision for credit losses 4,201     1,985     1,005     1,723     504  
Net interest income after provision for credit losses 40,421     40,984     41,021     40,338     38,993  
Noninterest income                  
Service charges and fees 3,620     3,435     3,316     3,349     3,234  
Mortgage banking revenue 3,092     3,252     2,606     2,288     2,621  
Insurance commission and fee income 3,203     3,036     3,510     2,481     3,306  
Gain (loss) on sales of securities, net 20             (8 )    
(Loss) gain on sales and disposals of other assets, net (132 )   (166 )   3     (23 )   (207 )
Limited partnership investment income (loss) 279     (418 )   400     745     (552 )
Swap fee income 1,351     172     511     299     518  
Change in fair value of equity investments     367              
Other fee income 414     360     276     592     364  
Other income 1,033     1,138     982     865     953  
Total noninterest income 12,880     11,176     11,604     10,588     10,237  
Noninterest expense                  
Salaries and employee benefits 21,523     22,764     22,613     21,333     21,054  
Occupancy and equipment, net 4,274     4,200     4,044     3,830     4,169  
Data processing 1,763     1,810     1,587     1,839     1,523  
Electronic banking 924     892     689     699     761  
Communications 411     647     586     513     490  
Advertising and marketing 930     1,089     798     1,351     1,245  
Professional services 956     839     904     1,024     982  
Regulatory assessments (387 )   691     711     666     411  
Loan related expenses 1,315     790     669     810     718  
Office and operations 1,712     1,849     1,481     1,516     1,499  
Intangible asset amortization 302     353     364     367     371  
Franchise tax expense 683     492     489     309     352  
Other income 658     679     446     766     769  
Total noninterest expense 35,064     37,095     35,381     35,023     34,344  
Income before income tax expense 18,237     15,065     17,244     15,903     14,886  
Income tax expense 3,620     2,782     3,089     2,725     2,568  
Net income $ 14,617     $ 12,283     $ 14,155     $ 13,178     $ 12,318  
Basic earnings per common share $ 0.62     $ 0.52     $ 0.60     $ 0.56     $ 0.52  
Diluted earnings per common share 0.62     0.52     0.60     0.55     0.52  


 
Origin Bancorp, Inc.
Loan Data
 
  At and for the three months ended
Loans held for investment September 30,
 2019
  June 30,
 2019
  March 31,
 2019
  December 31,
 2018
  September 30,
 2018
                   
Loans secured by real estate: (Dollars in thousands, unaudited)
Commercial real estate $ 1,305,006     $ 1,219,470     $ 1,202,269     $ 1,228,402     $ 1,162,274  
Construction/land/land development 509,905     524,999     488,167     429,660     406,249  
Residential real estate 680,803     651,988     638,064     629,714     585,931  
Total real estate 2,495,714     2,396,457     2,328,500     2,287,776     2,154,454  
Commercial and industrial 1,367,595     1,341,652     1,287,300     1,272,566     1,193,035  
Mortgage warehouse lines of credit 304,917     224,939     202,744     207,871     233,325  
Consumer 20,271     21,549     19,799     20,892     20,267  
Total loans held for investment 4,188,497     3,984,597     3,838,343     3,789,105     3,601,081  
Less: Allowance for loan losses 37,126     36,683     35,578     34,203     35,727  
Loans held for investment, net $ 4,151,371     $ 3,947,914     $ 3,802,765     $ 3,754,902     $ 3,565,354  
                   
Nonperforming assets                  
Nonperforming loans held for investment                  
Commercial real estate $ 7,460     $ 9,423     $ 8,622     $ 8,281     $ 8,851  
Construction/land/land development 860     1,111     922     935     960  
Residential real estate 5,254     4,978     5,196     6,668     7,220  
Commercial and industrial 17,745     14,810     15,309     15,792     9,285  
Consumer 153     156     206     180     238  
Total nonperforming loans held for investment 31,472     30,478     30,255     31,856     26,554  
Nonperforming loans held for sale 1,462     2,049     1,390     741     1,391  
Total nonperforming loans 32,934     32,527     31,645     32,597     27,945  
Repossessed assets 4,565     3,554     3,659     3,739     3,306  
Total nonperforming assets $ 37,499     $ 36,081     $ 35,304     $ 36,336     $ 31,251  
Classified assets $ 73,516     $ 80,124     $ 77,619     $ 82,914     $ 80,092  
Past due loans held for investment (1) 29,965     31,884     37,841     34,085     24,846  
                   
Allowance for loan losses                  
Balance at beginning of period $ 36,683     $ 35,578     $ 34,203     $ 35,727     $ 34,151  
Provision for loan losses 3,435     1,782     823     1,886     1,113  
Loans charged off 5,415     840     608     3,583     1,009  
Loan recoveries 2,423     163     1,160     173     1,472  
Net charge-offs (recoveries) 2,992     677     (552 )   3,410     (463 )
Balance at end of period $ 37,126     $ 36,683     $ 35,578     $ 34,203     $ 35,727  
                   
Credit quality ratios                  
Total nonperforming assets to total assets 0.69 %   0.70 %   0.72 %   0.75 %   0.67 %
Total nonperforming loans to total loans 0.77     0.80     0.82     0.85     0.77  
Nonperforming loans held for investment to loans held for investment 0.75     0.76     0.79     0.84     0.74  
Past due loans held for investment to loans held for investment 0.72     0.80     0.99     0.90     0.69  
Allowance for loan losses to nonperforming loans held for investment 117.97     120.36     117.59     107.37     134.54  
Allowance for loan losses to total loans held for investment 0.89     0.92     0.93     0.90     0.99  
Net charge-offs (recoveries) to total average loans held for investment (annualized) 0.29     0.07     (0.06 )   0.37     (0.05 )

____________________________
(1)  Past due loans held for investment are defined as loans 30 days past due or more.


 
Origin Bancorp, Inc.
Average Balances and Yields/Rates
 
  Three months ended
  September 30, 2019   June 30, 2019   September 30, 2018
  Average Balance   Yield/Rate   Average Balance   Yield/Rate   Average Balance   Yield/Rate
                       
Assets (Dollars in thousands, unaudited)
Commercial real estate $ 1,259,274     5.22 %   $ 1,209,645     5.16 %   $ 1,122,377     4.96 %
Construction/land/land development 533,328     5.48     505,119     5.70     392,936     5.34  
Residential real estate 676,650     5.07     640,123     4.90     575,126     4.75  
Commercial and industrial 1,340,684     5.26     1,310,611     5.36     1,120,431     4.96  
Mortgage warehouse lines of credit 236,042     4.92     203,524     5.45     228,031     5.37  
Consumer 20,959     6.90     20,902     7.01     20,129     6.91  
Loans held for investment 4,066,937     5.23     3,889,924     5.29     3,459,030     5.00  
Loans held for sale 33,814     4.15     23,927     3.45     22,157     5.20  
Loans Receivable 4,100,751     5.22     3,913,851     5.27     3,481,187     5.00  
Investment securities-taxable 448,766     2.48     492,169     2.61     440,676     2.50  
Investment securities-nontaxable 103,053     3.21     103,485     3.37     125,489     3.60  
Non-marketable equity securities held in other financial institutions 49,025     2.76     44,974     3.80     32,058     2.31  
Interest-bearing balances due from banks 152,580     2.39     164,686     2.67     148,853     2.38  
Federal funds sold                 1,304     2.03  
Total interest-earning assets 4,854,175     4.81 %   4,719,165     4.85 %   4,229,567     4.58 %
Noninterest-earning assets(1) 325,374         324,786         310,804      
Total assets $ 5,179,549         $ 5,043,951         $ 4,540,371      
                       
Liabilities and Stockholders' Equity                      
Liabilities                      
Interest-bearing liabilities                      
Savings and interest-bearing transaction accounts $ 2,071,990     1.36 %   $ 2,050,058     1.39 %   $ 1,963,821     1.01 %
Time deposits 828,993     2.16     830,399     2.13     740,893     1.54  
Total interest-bearing deposits 2,900,983     1.59     2,880,457     1.61     2,704,714     1.16  
Federal funds purchased         118     2.89          
FHLB advances and other borrowings 475,860     1.96     436,142     2.11     204,607     2.40  
Securities sold under agreements to repurchase 25,302     1.09     34,049     1.36     34,284     0.92  
Junior subordinated debentures 9,661     5.69     9,654     5.69     9,633     5.67  
Total interest-bearing liabilities 3,411,806     1.65 %   3,360,420     1.68 %   2,953,238     1.26 %
Noninterest-bearing deposits 1,076,344         1,018,081         984,330      
Other liabilities(1) 102,895         88,689         68,553      
Total liabilities 4,591,045         4,467,190         4,006,121      
Stockholders' Equity 588,504         576,761         534,250      
Total liabilities and stockholders' equity $ 5,179,549         $ 5,043,951         $ 4,540,371      
Net interest spread     3.16 %       3.17 %       3.32 %
Net interest margin     3.65 %       3.65 %       3.70 %
Net interest income margin - (tax- equivalent)(2)     3.69 %       3.70 %       3.76 %

____________________________
(1)  Includes Government National Mortgage Association ("GNMA") repurchase average balances of $23.7 million, $25.8 million and $29.9 million for the three months ended September 30, 2019, June 30, 2019, and September 30, 2018, respectively. The GNMA repurchase asset and liability are recorded as equal offsetting amounts in the consolidated balance sheets, with the asset included in Loans held for sale and the liability included in FHLB advances and other borrowings.
(2)  In order to present pre-tax income and resulting yields on tax-exempt investments comparable to those on taxable investments, a tax-equivalent adjustment has been computed. This adjustment also includes income tax credits received on Qualified School Construction Bonds.

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