THIRD COAST BANCSHARES, INC. REPORTS THIRD QUARTER 2022 FINANCIAL RESULTS


Record Quarterly Net Income and Net Interest Income

HUMBLE, Texas, Oct. 26, 2022 /PRNewswire/ — Third Coast Bancshares, Inc. (NASDAQ: TCBX) (the “Company”, “Third Coast”, “we”, “us”, or “our”), the bank holding company for Third Coast Bank, SSB, today reported its third quarter 2022 financial results.

Third Quarter 2022 Financial and Operational Highlights

  • Loans held for investment grew $223.7 million to $2.97 billion as of September 30, 2022, or 8.1%, over the $2.75 billion reported as of June 30, 2022, and increased $1.36 billion, or 84.4%, over the $1.61 billion reported as of September 30, 2021.
  • Deposits reached $2.98 billion as of September 30, 2022, an increase of $86.1 million, or 3.0%, over the $2.90 billion reported as of June 30, 2022, and $1.17 billion, or 64.3%, over the $1.82 billion reported as of September 30, 2021. Noninterest-bearing deposits declined $2.3 million to $517.3 million and represent 17.3% of total deposits as of September 30, 2022.
  • Total assets reached $3.52 billion as of September 30, 2022, an increase of $158.8 million, or 4.7%, over the $3.36 billion reported as of June 30, 2022, and $1.4 billion, or 68.9%, more than the $2.08 billion reported as of September 30, 2021.
  • Net income totaled $6.8 million, or $0.49 per diluted common share, for the third quarter of 2022, compared to $2.3 million, or $0.16 per diluted common share, for the second quarter of 2022.
  • Book value per share and tangible book value per share(1) increased to $22.93 and $21.51, respectively, at September 30, 2022 compared to $22.43 and $21.00, respectively, at June 30, 2022.
  • Issued 69,400 shares of Series A Convertible Non-Cumulative Preferred Stock and 175,000 warrants to purchase shares of the Company’s common stock for gross proceeds of $69.4 million.
  • Opened 15th location in October 2022 with a de novo branch located in the Kingwood area, north of Houston, Texas.

 











(1)

Non-GAAP financial measure. Please refer to the table titled “GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures” at the end of this press release for a reconciliation of these non-GAAP financial measures.

“Third Coast continues to track in the right direction, reporting another quarter of solid organic growth that demonstrates our well-executed strategy to invest in people that perform at a high level,” stated Bart Caraway, Third Coast’s Chairman, President and Chief Executive Officer. “Record net interest income of $31.4 million, and net income of $6.8 million, resulted from continued operating leverage. Third quarter loans and deposits are up $1.36 billion and $1.17 billion, respectively, over last year.  Our asset quality, a key emphasis for our lending culture, remains strong, representing a significant year-over-year reduction in non-performing assets to 0.29% of total assets. 

“As we approach our first anniversary as a publicly traded company, we are seeing more demand for our financial products that, in step with our strategic growth plan, advance our efforts to increase quality offerings, including investing in research and development to grow deposits and fee income. We intend to continue to enhance our diversified business model and invest in talent at all levels of the organization so that we can be the leading community bank in the markets we serve.

“Our people are critical to our success. Third Coast is committed to serving our customers, building relationships, cultivating technological evolution, and expanding our markets. Regarding our branch network, we recently opened our 15th branch in Kingwood, just north of Houston. Third Coast is focused on providing the highest quality service and financial products to commercial and retail clients through its 15 branches.  I want to thank the expanding Third Coast team once again for their commitment to delivering excellence to our customers and shareholders.

“Looking ahead, we are very excited about the future. Third Coast is poised for growth, especially as we look to bring exciting and beneficial financial products to market. We remain intensely focused on operating performance, which is bolstered by the general health of the Texas economy and improving trends that we are experiencing in our lending portfolio,” concluded Mr. Caraway.

Loan Portfolio and Composition

During the third quarter of 2022, gross loans increased to $2.97 billion as of September 30, 2022, an increase of $223.7 million, or 8.1%, from $2.75 billion as of June 30, 2022, and an increase of $1.36 billion, or 84.4%, from $1.61 billion as of September 30, 2021. The loan growth was well diversified with Real Estate loans up $115.0 million and Commercial loans up $114.4 million from June 30, 2022. PPP loans declined to $1.9 million as of September 30, 2022 from $8.8 million as of June 30, 2022.

Asset Quality

Asset quality improved during the third quarter of 2022 with non-performing assets decreasing to $10.3 million as of September 30, 2022, or 44.6%, from $18.6 million as of September 30, 2021 and down slightly from $11.0 million as of June 30, 2022. The provision for loan losses recorded for the third quarter of 2022 was $2.9 million, which served to increase the allowance to $29.1 million, or 0.98% of the $2.97 billion in gross loans outstanding as of September 30, 2022. Provision expense for the third quarter of 2022 related primarily to provisioning for new loans.

As of September 30, 2022, the nonperforming loans to loans held for investment ratio remains low at 0.35%, which decreased from 0.40% as of June 30, 2022 and 1.05% as of September 30, 2021. During the three months ended September 30, 2022 and 2021, net charge-offs were  $457,000 and $146,000 respectively. 

Deposits and Composition

Deposits totaled $2.98 billion as of September 30, 2022, an increase of 3.0% from $2.90 billion as of June 30, 2022, and an increase of 64.3% from $1.82 billion as of September 30, 2021. Noninterest-bearing demand deposits decreased from $519.6 million as of June 30, 2022 to $517.3 million as of September 30, 2022, and increased $152.8 million, or 41.9%, from September 30, 2021. Noninterest-bearing demand deposits represented 17.3% of total deposits as of September 30, 2022, down from 17.9% of total deposits as of June 30, 2022, and 20.1% of total deposits as of September 30, 2021. Interest-bearing demand deposits as of September 30, 2022 increased $120.4 million, or 5.7%, from June 30, 2022. The increase was offset by a decrease in savings accounts of $1.2 million, or 3.1%, from June 30, 2022, and decrease in time deposits of $30.8 million, or 13.3%, from June 30, 2022.

The average cost of deposits was 1.31% for the third quarter of 2022, representing a 79 basis point increase from the second quarter of 2022 due primarily to the increase in rates paid on interest-bearing demand deposits.  The average cost of deposits for the third quarter of 2022 increased 87 basis points from the third quarter of 2021 due primarily to the increase in rates paid on interest-bearing demand deposits. 

Net Interest Margin and Net Interest Income

The net interest margin for the third quarter of 2022 was 3.77% which was unchanged from the second quarter of 2022 and a decrease of 72 basis points from the third quarter of 2021. We recorded excess accretion on purchased loans of $665,000 during the third quarter which increased the net interest margin by approximately 8 basis points. The yield on loans for the third quarter of 2022 was 5.59% compared to 4.73% for the second quarter of 2022. The increase in yield on loans during the third quarter of 2022 was primarily due to increased rates on new loans and an increase of $1.1 million in loan fees during the third quarter. 

Net interest income totaled $31.4 million for the third quarter of 2022, an increase of 13.0% from $27.7 million for the second quarter of 2022. Interest income totaled $43.1 million for the third quarter of 2022, an increase of 32.6% from $32.5 million for the second quarter of 2022. Interest and fees on loans increased $9.3 million, or 30.0%, compared to the second quarter of 2022, and increased $16.6 million, or 69.2%, from the third quarter of 2021.  Interest expense was $11.7 million for the third quarter of 2022, an increase of $7.0 million, or 146.2% from $4.8 million for the second quarter of 2022 and an increase of 390.1% from $2.4 million for the third quarter of 2021. The increase in interest expense was primarily due to interest paid on interest-bearing deposit accounts, FHLB advances and subordinated debt issued in March 2022.

Noninterest Income and Noninterest Expense

Noninterest income totaled $2.5 million for the third quarter of 2022, compared to $1.3 million for the second quarter of 2022, and $964,000 for the third quarter of 2021. This increase was primarily due to $729,000 in gains on the sales of the guaranteed portions of SBA loans sold and increases in derivative income of $190,000, earnings on bank-owned life insurance of $176,000, and service charges and fees of $155,000 in the third quarter of 2022.

Noninterest expense totaled $22.7 million for the third quarter of 2022 down from $22.8 million for the second quarter of 2022 and up from $17.6 million for the third quarter of 2021. The year-over-year increases were attributed to salary expense related to additional employees hired in 2022 and administrative expenses related to opening of three branches in 2022. The employee headcount increased from 334 as of December 31, 2021 to 369 as of September 30, 2022.

The efficiency ratio was 67.06% for the third quarter of 2022, compared to 78.52% for the second quarter of 2022, and 76.81% for the third quarter of 2021. The improvement in the efficiency ratio was primarily due to the increase in interest and fees on loans.   

Net Income and Earnings Per Share

Net income totaled $6.8 million for the third quarter of 2022, compared to $2.3 million for the second quarter of 2022. Basic earnings per share and diluted earnings per share increased to $0.50 per share and $0.49 per share, respectively, in the third quarter of 2022 from $0.17 per share and $0.16 per share, respectively, in the second quarter of 2022. 

Private Placement of $69.4 Million of Convertible Preferred Stock

As previously reported, the Company issued 69,400 shares of Series A Convertible Non-Cumulative Preferred Stock at a purchase price of $1,000 per share for aggregate gross proceeds of $69.4 million on September 30, 2022. In addition, the Company issued 175,000 warrants to purchase shares of the Company’s common stock, par value $1.00 per share, in connection with the private placement offering.

Earnings Conference Call

Third Coast has scheduled a conference call to discuss third quarter 2022 results, which will be broadcast live over the Internet, on Thursday, October 27, 2022, at 11:00 a.m. Eastern Time / 10:00 a.m. Central Time. To participate in the call, dial 201-389-0869 and ask for the Third Coast Bancshares call at least 10 minutes prior to the start time, or access it live over the Internet at https://ir.tcbssb.com/events-and-presentations/events. For those who cannot listen to the live call, a replay will be available through November 3, 2022, and may be accessed by dialing 201-612-7415 and using passcode 13733542#. Also, an archive of the webcast will be available shortly  after the call at https://ir.tcbssb.com/events-and-presentations/events for 90 days.

About Third Coast Bancshares, Inc.

Third Coast Bancshares, Inc. is a commercially focused, Texas-based bank holding company operating primarily in the Greater Houston, Dallas-Fort Worth, and Austin-San Antonio markets through its wholly owned subsidiary, Third Coast Bank, SSB. Founded in 2008 in Humble, Texas, Third Coast Bank, SSB conducts banking operations through 15 branches and one loan production office encompassing the four largest metropolitan areas in Texas. Please visit https://www.tcbssb.com for more information.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties and are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.  There are or will be important factors that could cause our actual results to differ materially from those indicated in these forward-looking statements, including, but not limited to, the following: the impact of COVID-19 on our business, including the impact of the actions taken by governmental authorities to try and contain the virus or address the impact of the virus on the United States

economy; interest rate risk and fluctuations in interest rates; our ability to maintain our largest deposit relationships; our ability to grow or maintain our deposit base; our ability to implement our expansion strategy; changes in key management personnel; credit risk associated with our business; and other market conditions and economic trends generally and in the banking industry. For a discussion of additional factors that could cause our actual results to differ materially from those described in the forward-looking statements, please see the risk factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the U.S. Securities and Exchange Commission (the “SEC”), and our other filings with the SEC.                           

The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements included in this press release. If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and we do 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 factors emerge from time to time, and it is not possible for us to predict which will arise. In addition, we cannot assess the impact of each factor on our 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.

Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures, including “Tangible Book Value Per Share, Tangible Common Equity to Tangible Assets Ratio and Return on Average Tangible Common Equity,” which are supplemental measures that are not required by, or are not presented in accordance with GAAP. Please refer to the table titled “GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures” at the end of this press release for a reconciliation of these non-GAAP financial measures.

Contact:

Ken Dennard / Natalie Hairston

Dennard Lascar Investor Relations

(713) 529-6600

TCBX@dennardlascar.com

 

Third Coast Bancshares, Inc. and Subsidiary

Financial Highlights

(unaudited)




2022



2021



(Dollars in thousands)


September 30



June 30



March 31



December 31



September 30



ASSETS

















Cash and cash equivalents:

















Cash and due from banks


$

216,623



$

317,462



$

369,782



$

326,733



$

359,888



Federal funds sold



1,225




2,741




1,538




292




696



Total cash and cash equivalents



217,848




320,203




371,320




327,025




360,584




















Interest bearing time deposits in other banks



132




132




132




131




131



Investment securities available-for-sale



160,437




157,261




126,218




26,432




26,431



Loans held for investment



2,972,852




2,749,177




2,447,945




2,068,724




1,612,394



Less:  allowance for loan and lease loss



(29,109)




(26,666)




(23,312)




(19,295)




(15,571)



Loans, net



2,943,743




2,722,511




2,424,633




2,049,429




1,596,823



Accrued interest receivable



16,246




12,568




12,648




10,228




10,238



Premises and equipment, net



25,449




22,888




20,846




19,045




18,364



Other real estate owned









1,666




1,676




1,676



Bank-owned life insurance



60,263




51,919




26,671




26,528




26,382



Non-marketable securities, at cost



27,136




15,213




11,327




7,527




10,905



Deferred tax asset, net



8,097




7,179




4,258




4,123




4,456



Core Deposit Intangible, net



1,171




1,211




1,252




1,292




1,332



Goodwill



18,034




18,034




18,034




18,034




18,034



Other assets



38,289




28,943




21,383




7,942




6,815



Total assets


$

3,516,845



$

3,358,062



$

3,040,388



$

2,499,412



$

2,082,171




















LIABILITIES

















Deposits:

















Noninterest bearing


$

517,265



$

519,614



$

931,622



$

531,401



$

364,418



Interest bearing



2,467,049




2,378,650




1,655,547




1,609,798




1,451,533



Total deposits



2,984,314




2,898,264




2,587,169




2,141,199




1,815,951




















Accrued interest payable



2,925




1,683




387




437




477



Other liabilities



42,079




26,906




20,122




7,769




8,291



FHLB advances






18,000




50,000




50,000




50,250



Note payable – Line of Credit



30,875




30,875




1,000




1,000




1,000



Note payable – Subordinated Debentures, net



80,298




80,367




80,507









Total liabilities



3,140,491




3,056,095




2,739,185




2,200,405




1,875,969




















Commitments and contingencies – ESOP-owned shares















2,060




















SHAREHOLDERS’ EQUITY

















Preferred Stock – Series A



69















Common stock



13,600




13,543




13,524




13,482




9,387



Additional paid-in capital



317,798




250,413




249,775




249,202




160,725



Retained earnings



47,163




40,393




38,116




36,029




35,675



Accumulated other comprehensive income



(1,177)




(1,283)




887




1,393




1,394



Treasury stock, at cost



(1,099)




(1,099)




(1,099)




(1,099)




(979)






376,354




301,967




301,203




299,007




206,202



Less:  ESOP-owned shares















(2,060)



Total shareholders’ equity



376,354




301,967




301,203




299,007




204,142



Total liabilities and shareholders’ equity


$

3,516,845



$

3,358,062



$

3,040,388



$

2,499,412



$

2,082,171



 

Third Coast Bancshares, Inc. and Subsidiary

Financial Highlights

(unaudited)








Three Months Ended



Year Ended





2022



2021



2021



(Dollars in thousands, except per share data)


September 30



June 30



March 31



December 31



September 30



December 31



INTEREST INCOME:




















Loans, including fees


$

40,498



$

31,164



$

26,682



$

26,226



$

23,940



$

98,886



Investment securities available-for-sale



1,367




894




276




265




265




1,043



Federal funds sold and other



1,237




451




226




169




194




686



Total interest income



43,102




32,509




27,184




26,660




24,399




100,615























INTEREST EXPENSE:




















Deposit accounts



9,727




3,443




1,844




1,913




2,023




8,526



FHLB advances and notes payable



2,020




1,328




130




128




374




1,536



Total interest expense



11,747




4,771




1,974




2,041




2,397




10,062























Net interest income



31,355




27,738




25,210




24,619




22,002




90,553























Provision for loan losses



2,900




3,350




4,000




6,100




2,323




9,923























Net interest income after provision for loan losses



28,455




24,388




21,210




18,519




19,679




80,630























NONINTEREST INCOME:




















Service charges and fees



772




617




619




566




559




2,367



Gain on sale of SBA loans



729




98







411




175




586



Earnings on bank-owned life insurance



424




248




143




146




145




567



Derivative fees



313




123




706




820







820



Other



300




180




198




112




85




538



Total noninterest income



2,538




1,266




1,666




2,055




964




4,878























NONINTEREST EXPENSE:




















Salaries and employee benefits



14,719




13,994




13,324




14,029




12,138




48,642



Data processing and network expense



1,256




932




922




786




844




3,060



Occupancy and equipment expense



2,232




1,830




1,873




1,557




1,419




5,367



Legal and professional



1,353




2,001




1,746




1,450




1,164




5,293



Loan operations and other real estate owned expense



284




282




278




275




495




1,963



Advertising and marketing



438




467




427




657




422




1,889



Telephone and communications



122




99




100




115




119




595



Software purchases and maintenance



318




201




198




248




261




852



Regulatory assessments



1,000




956




645




506




252




1,101



Loss on sale of other real estate owned






350













344



Other



1,006




1,661




668




464




527




1,919



Total noninterest expense



22,728




22,773




20,181




20,087




17,641




71,025























NET INCOME BEFORE INCOME TAX EXPENSE



8,265




2,881




2,695




487




3,002




14,483























Income tax expense



1,495




604




608




133




617




3,059























NET INCOME


$

6,770



$

2,277



$

2,087



$

354



$

2,385



$

11,424























EARNINGS PER COMMON SHARE:




















Basic earnings per share


$

0.50



$

0.17



$

0.16



$

0.03



$

0.29



$

1.45



Diluted earnings per share


$

0.49



$

0.16



$

0.15



$

0.03



$

0.28



$

1.40



 

Third Coast Bancshares, Inc. and Subsidiary

Financial Highlights

(unaudited)




Three Months Ended



Year Ended




2022



2021



2021


(Dollars in thousands, except share and per share data)


September 30



June 30



March 31



December 31



September 30



December 31





















Net Income


$

6,770



$

2,277



$

2,087



$

354



$

2,385



$

11,424








































Earnings per share, basic


$

0.50



$

0.17



$

0.16



$

0.03



$

0.29



$

1.45


Earnings per share, diluted


$

0.49



$

0.16



$

0.15



$

0.03



$

0.28



$

1.40


Dividends per share


$



$



$



$



$



$





















Return on average assets (A)



0.78

%



0.29

%



0.32

%



0.06

%



0.46

%



0.55

%

Return on average common equity (A)



8.74

%



3.01

%



2.81

%



0.55

%



5.41

%



6.70

%

Return on average tangible common equity (A) (B)



9.32

%



3.22

%



3.00

%



0.59

%



6.09

%



7.55

%

Net interest margin (A) (C)



3.77

%



3.77

%



4.09

%



4.78

%



4.49

%



4.65

%

Efficiency ratio (D)



67.06

%



78.52

%



75.09

%



75.31

%



76.81

%



74.43

%




















Capital Ratios



















Third Coast Bancshares, Inc. (consolidated):



















Total common equity to total assets



8.82

%



8.99

%



9.91

%



11.96

%



9.90

%



11.96

%

Tangible common equity to tangible assets (B)



8.32

%



8.47

%



9.33

%



11.28

%



9.06

%



11.28

%




















Third Coast Bank, SSB:



















Common equity tier 1 (to risk weighted assets)



13.04

%



11.60

%



12.36

%



12.63

%



11.89

%



12.63

%

Tier 1 capital (to risk weighted assets)



13.04

%



11.60

%



12.36

%



12.63

%



11.89

%



12.63

%

Total capital (to risk weighted assets)



13.87

%



12.40

%



13.17

%



13.54

%



12.96

%



13.54

%

Tier 1 capital (to average assets)



13.29

%



12.47

%



13.66

%



12.27

%



8.39

%



12.27

%




















Other Data



















Weighted average shares:



















Basic



13,490,680




13,454,423




13,385,324




10,724,545




8,099,878




7,874,110


Diluted



13,678,962




13,822,522




13,755,026




11,156,037




8,448,112




8,138,824


Period end shares outstanding



13,521,826




13,464,093




13,445,782




13,403,324




9,313,929




13,403,324


Book value per share


$

22.93



$

22.43



$

22.40



$

22.31



$

22.14



$

22.31


Tangible book value per share (B)


$

21.51



$

21.00



$

20.97



$

20.87



$

20.06



$

20.87













(A) Interim periods annualized.

(B) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on pages 12 and 13 of this News Release.

(C) Net interest margin represents net interest income divided by average interest-earning assets.

(D) Represents total noninterest expense divided by the sum of net interest income plus noninterest income. Taxes and provision for loan losses are not part of this calculation.

 

Third Coast Bancshares, Inc. and Subsidiary

Financial Highlights

(unaudited)




Three Months Ended



September 30, 2022


June 30, 2022


September 30, 2021

(Dollars in thousands)


Average

Outstanding

Balance



Interest

Earned/

Paid(3)



Average

Yield/

Rate


Average

Outstanding

Balance



Interest

Earned/

Paid(3)



Average

Yield/

Rate


Average

Outstanding

Balance



Interest

Earned/

Paid(3)



Average

Yield/

Rate

Assets

























Interest-earnings assets:

























Investment securities


$

180,701



$

1,367



3.00 %


$

112,793



$

894



3.18 %


$

31,588



$

265



3.33 %

Loans, gross



2,874,857




40,498



5.59 %



2,641,330




31,164



4.73 %



1,553,517




23,940



6.11 %

Federal funds sold and other interest-earning assets



243,471




1,237



2.02 %



200,801




451



0.90 %



360,723




194



0.21 %

Total interest-earning assets



3,299,029




43,102



5.18 %



2,954,924




32,509



4.41 %



1,945,828




24,399



4.97 %

Less allowance for loan losses



(27,504)









(24,818)









(13,466)







Total interest-earning assets, net of allowance



3,271,525









2,930,106









1,932,362







Noninterest-earning assets



184,514









201,734









138,687







Total assets


$

3,456,039








$

3,131,840








$

2,071,049
































Liabilities and Shareholders’ Equity

























Interest-bearing liabilities:

























Interest-bearing deposits


$

2,446,443



$

9,727



1.58 %


$

2,222,677



$

3,443



0.62 %


$

1,423,418



$

2,023



0.56 %

Notes payable and fed funds sold



111,213




1,617



5.77 %



83,390




1,208



5.81 %



21,278




262



4.89 %

FHLB advances



60,176




403



2.66 %



46,319




120



1.04 %



55,418




112



0.80 %

Total interest-bearing liabilities



2,617,832




11,747



1.78 %



2,352,386




4,771



0.81 %



1,500,114




2,397



0.63 %

Noninterest-bearing deposits



498,408









453,936









386,727







Other liabilities



31,707









22,383









9,440







Total liabilities



3,147,947









2,828,705









1,896,281







Shareholders’ equity



308,092









303,135









174,768







Total liabilities and shareholders’ equity


$

3,456,039








$

3,131,840








$

2,071,049







Net interest income





$

31,355








$

27,738








$

22,002




Net interest spread (1)








3.40 %








3.60 %








4.34 %

Net interest margin (2)








3.77 %








3.77 %








4.49 %









(1) Net interest spread is the average yield on interest earning assets minus the average rate on interest-bearing liabilities.

(2) Net interest margin represents net interest income divided by average interest-earning assets.

(3) Interest earned/paid includes accretion of deferred loan fees, premiums and discounts. 

 

Third Coast Bancshares, Inc. and Subsidiary

Financial Highlights

(unaudited)




Nine Months Ended



September 30, 2022


September 30, 2021

(Dollars in thousands)


Average

Outstanding

Balance



Interest

Earned/

Paid(3)



Average

Yield/

Rate


Average

Outstanding

Balance



Interest

Earned/

Paid(3)



Average

Yield/

Rate

Assets

















Interest-earnings assets:

















Investment securities


$

115,705



$

2,537



2.93 %


$

27,400



$

778



3.80 %

Loans, gross



2,577,324




98,344



5.10 %



1,603,555




72,660



6.06 %

Federal funds sold and other interest-earning assets



236,552




1,914



1.08 %



282,065




517



0.25 %

Total interest-earning assets



2,929,581




102,795



4.69 %



1,913,020




73,955



5.17 %

Less allowance for loan losses



(24,265)









(13,211)







Total interest-earning assets, net of allowance



2,905,316









1,899,809







Noninterest-earning assets



169,473









114,310







Total assets


$

3,074,789








$

2,014,119
























Liabilities and Shareholders’ Equity

















Interest-bearing liabilities:

















Interest-bearing deposits


$

2,279,048



$

15,014



0.88 %


$

1,400,424



$

6,613



0.63 %

Notes payable



65,898




2,848



5.78 %



29,475




1,080



4.90 %

FHLB advances



52,202




630



1.61 %



53,115




328



0.83 %

Total interest-bearing liabilities



2,397,148




18,492



1.03 %



1,483,014




8,021



0.72 %

Noninterest-bearing deposits



351,002









380,645







Other liabilities



22,361









9,134







Total liabilities



2,770,511









1,872,793







Shareholders’ equity



304,278









141,326







Total liabilities and shareholders’ equity


$

3,074,789








$

2,014,119







Net interest income





$

84,303








$

65,934




Net interest spread (1)








3.66 %








4.45 %

Net interest margin (2)








3.85 %








4.61 %










(1) Net interest spread is the average yield on interest earning assets minus the average rate on interest-bearing liabilities.

(2) Net interest margin represents net interest income divided by average interest-earning assets.

(3) Interest earned/paid includes accretion of deferred loan fees, premiums and discounts. 

 

Third Coast Bancshares, Inc. and Subsidiary

Financial Highlights

(unaudited)






Three Months Ended





2022



2021



(Dollars in thousands)


September 30



June 30



March 31



December 31



September 30



Period-end Loan Portfolio:

















Real estate loans:

















Commercial real estate:

















Non-farm non-residential owner occupied


$

529,046



$

508,864



$

477,573



$

383,941



$

361,467



Non-farm non-residential non-owner occupied



490,503




464,530




463,618




445,308




345,360



Residential



283,432




273,415




225,649




213,264




179,971



Construction, development & other



500,879




440,925




414,653




320,335




124,548



Farmland



22,770




23,895




13,467




9,934




8,309



Commercial & industrial



1,029,231




914,845




756,005




611,348




538,551



Consumer



3,728




3,706




3,304




4,001




4,417



Other



113,263




118,997




93,676




80,593




49,771



Total loans


$

2,972,852



$

2,749,177



$

2,447,945



$

2,068,724



$

1,612,394




















Asset Quality:

















Nonaccrual loans


$

9,439



$

9,806



$

9,896



$

10,030



$

11,077



Loans > 90 days and still accruing



98




387




40




278




561



Restructured loans–accruing



781




785




790




5,295




5,319



Total nonperforming loans


$

10,318



$

10,978



$

10,726



$

15,603



$

16,957



Other real estate owned









1,666




1,676




1,676



Total nonperforming assets


$

10,318



$

10,978



$

12,392



$

17,279



$

18,633




















QTD Net charge-offs (recoveries)


$

457



$

(4)



$

(17)



$

2,376



$

146




















Nonaccrual loans:

















Real estate loans:

















Commercial real estate:

















Non-farm non-residential owner occupied


$

921



$

964



$

986



$

1,008



$

1,032



Non-farm non-residential non-owner occupied



309




323




334




346




353



Residential



111




116




121




127




133



Construction, development & other



227




232




238




244




251



Farmland

















Commercial & industrial



7,846




8,165




8,210




8,297




9,162



Consumer



20















Other

















Purchased credit impaired



5




6




7




8




146



Total nonaccrual loans


$

9,439



$

9,806



$

9,896



$

10,030



$

11,077




















Asset Quality Ratios:

















Nonperforming assets to total assets



0.29

%



0.33

%



0.41

%



0.69

%



0.89

%


Nonperforming loans to total loans



0.35

%



0.40

%



0.44

%



0.75

%



1.05

%


Allowance for loan losses to total loans



0.98

%



0.97

%



0.95

%



0.93

%



0.97

%


QTD Net charge-offs(recoveries) to average loans (annualized)



0.06

%



0.00

%



0.00

%



0.53

%



0.04

%


Third Coast Bancshares, Inc. and Subsidiary

GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures

(unaudited)

Our accounting and reporting policies conform to GAAP (generally accepted accounting principles) and the prevailing practices in the banking industry. However, we also evaluate our performance based on certain additional financial measures discussed in this earnings release as being non-GAAP financial measures. Specifically, we review “Tangible Book Value Per Share, Tangible Common Equity to Tangible Assets Ratio, and Return on Average Tangible Common Equity” for internal planning and forecasting purposes. We classify a financial measure as a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are not included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in our statements of income, balance sheets or statements of cash flows. Non-GAAP financial measures do not include operating and other statistical measures or ratios or statistical measures calculated using exclusively financial measures calculated in accordance with GAAP.

 The non-GAAP financial measures that we discuss in this earnings release should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which we calculate the non-GAAP financial measures that we discuss in this earnings release may differ from that of other companies reporting measures with similar names. It is important to understand how other banking organizations calculate their financial measures with names similar to the non-GAAP financial measures we have discussed in this earnings release when comparing such non-GAAP financial measures.  



Three Months Ended



Year Ended




2022



2021



2021


(Dollars in thousands, except per share data)


September 30



June 30



March 31



December 31



September 30



December 31


Tangible Common Equity:



















Total shareholders’ equity


$

376,354



$

301,967



$

301,203



$

299,007



$

206,202



$

299,007


Less:  Preferred stock including additional paid in capital



66,273

















Total common equity



310,081




301,967




301,203




299,007




206,202




299,007


Less:  Goodwill and core deposit intangibles, net



19,205




19,245




19,286




19,326




19,366




19,326


Tangible common equity


$

290,876



$

282,722



$

281,917



$

279,681



$

186,836



$

279,681





















Common shares outstanding at end of period



13,521,826




13,464,093




13,445,782




13,403,324




9,313,929




13,403,324





















Book Value Per Share


$

22.93



$

22.43



$

22.40



$

22.31



$

22.14



$

22.31


Tangible Book Value Per Share


$

21.51



$

21.00



$

20.97



$

20.87



$

20.06



$

20.87








































Tangible Assets:



















Total assets


$

3,516,845



$

3,358,062



$

3,040,388



$

2,499,412



$

2,082,171



$

2,499,412


Adjustments:  Goodwill and core deposit intangibles, net



19,205




19,245




19,286




19,326




19,366




19,326


Tangible assets


$

3,497,640



$

3,338,817



$

3,021,102



$

2,480,086



$

2,062,805



$

2,480,086





















Total Common Equity to Total Assets



8.82

%



8.99

%



9.91

%



11.96

%



9.90

%



11.96

%

Tangible Common Equity to Tangible Assets



8.32

%



8.47

%



9.33

%



11.28

%



9.06

%



11.28

%





Three Months Ended



Year Ended




2022



2021



2021


(Dollars in thousands, except per share data)


September 30



June 30



March 31



December 31



September 30



December 31


Average Tangible Common Equity:



















Average shareholders’ equity


$

308,092



$

303,135



$

301,537



$

257,583



$

174,768



$

170,630


Less:  Average preferred stock including additional paid in capital



720

















Average common equity



307,372




303,135




301,537




257,583




174,768




170,630


Less:  Average goodwill and core deposit intangibles, net



19,225




19,265




19,306




19,343




19,383




19,404


Average tangible common equity


$

288,147



$

283,870



$

282,231



$

238,240



$

155,385



$

151,226





















Net Income


$

6,770



$

2,277



$

2,087



$

354



$

2,385



$

11,424





















Return on Average Common Equity



8.74

%



3.01

%



2.81

%



0.55

%



5.41

%



6.70

%

Return on Average Tangible Common Equity



9.32

%



3.22

%



3.00

%



0.59

%



6.09

%



7.55

%

 

Cision View original content:https://www.prnewswire.com/news-releases/third-coast-bancshares-inc-reports-third-quarter-2022-financial-results-301660506.html

SOURCE Third Coast Bancshares

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