UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 28, 2016

 

 

Investar Holding Corporation

(Exact name of registrant as specified in its charter)

 

 

 

Louisiana   001-36522   27-1560715

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

7244 Perkins Road

Baton Rouge, Louisiana 70808

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (225) 227-2222

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 


Item 2.02 Results of Operations and Financial Condition.

On July 28, 2016, Investar Holding Corporation issued a press release announcing its financial results for the quarter ended June 30, 2016. A copy of the press release is furnished as exhibit 99.1 to this Current Report on Form 8-K.

The information contained in this Current Report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act except as shall be expressly set forth by specific reference in such a filing.

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit
Number

  

Description of Exhibit

99.1   

Press release of Investar Holding Corporation dated July 28, 2016 announcing financial results for the quarter ended June 30, 2016.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    INVESTAR HOLDING CORPORATION
Date: July 28, 2016     By:   /s/ John J. D’Angelo
      John J. D’Angelo
      President and Chief Executive Officer


EXHIBIT INDEX

 

Exhibit
Number

  

Description of Exhibit

99.1   

Press release of Investar Holding Corporation dated July 28, 2016 announcing financial results for the quarter ended June 30, 2016.

Exhibit 99.1

For Immediate Release

Investar Holding Corporation Announces 2016 Second Quarter Results

BATON ROUGE, LA (July 28, 2016) – Investar Holding Corporation (NASDAQ: ISTR) (the “Company”), the holding company for Investar Bank (the “Bank”), today announced financial results for the quarter ended June 30, 2016. The Company reported net income of $2.0 million, or $0.28 per diluted share for the second quarter of 2016, compared to $2.0 million, or $0.28 per diluted share for the quarter ended March 31, 2016, and $1.8 million, or $0.25 per diluted share, for the quarter ended June 30, 2015.

Investar Holding Corporation President and Chief Executive Officer John D’Angelo said:

“This was another successful quarter for Investar and demonstrates our continued emphasis on creating long-term shareholder value. We continued to experience solid organic loan growth which fueled the increase in interest income. Deposit growth remains a focus and we are very pleased with the 15% growth in our noninterest-bearing deposits. During the quarter, we increased the quarterly dividend payable to shareholders by 11% as well as repurchased over 82,000 shares of our common stock. This brings our total repurchases to 140,000 shares under our share repurchase program, which is approximately 56% of the total shares authorized for repurchase. Our Board and management remain keenly focused on our commitment to delivering shareholder value as demonstrated by our increased dividend and stock repurchase activity.”

Second Quarter Highlights

 

   

Total loans, excluding loans held for sale, increased 9.7% year to date, or 19.4% annualized. Total loans, excluding loans held for sale, increased $19.8 million, or 2.5%, compared to March 31, 2016, and increased $143.9 million, or 21.4%, compared to June 30, 2015, to $817.5 million at June 30, 2016.

 

   

The business lending portfolio, which consists of loans secured by owner-occupied commercial real estate properties and commercial and industrial loans, was $226.6 million at June 30, 2016, an increase of $10.0 million, or 4.6%, compared to the business lending portfolio of $216.6 million at March 31, 2016, and an increase of $40.3 million, or 21.6%, compared to the business lending portfolio of $186.3 million at June 30, 2015.

 

   

Other real estate owned decreased $0.4 million, or 59.9%, to $0.3 million at June 30, 2016, compared to $0.7 million at March 31, 2016, and decreased $2.2 million, or 88.9%, compared to $2.5 million at June 30, 2015.

 

   

Total noninterest-bearing deposits were $109.8 million at June 30, 2016, an increase of $14.8 million, or 15.6%, compared to March 31, 2016, and an increase of $23.5 million, or 27.2%, compared to June 30, 2015.

 

   

Total interest income increased $0.3 million, or 3.2%, compared to the quarter ended March 31, 2016, and increased $1.5 million, or 16.7%, compared to the quarter ended June 30, 2015, to $10.7 million for the quarter ended June 30, 2016.

 

   

Net charge-offs remain low, averaging 0.02% of total loans for the past eight quarters.

 

   

The Company repurchased 82,123 shares of the Company’s common stock through our stock repurchase program at an average price of $15.55 during the quarter ended June 30, 2016.


Loans

Total loans were $817.5 million at June 30, 2016, an increase of $19.8 million, or 2.5 %, compared to March 31, 2016, and an increase of $143.9 million, or 21.4%, compared to June 30, 2015.

The following table sets forth the composition of the Company’s loan portfolio as of the dates indicated (dollars in thousands).

 

                       Linked Qtr
Change
    Year/Year Change     Percentage of
Total Loans
 
     6/30/2016     3/31/2016     6/30/2015     $     %     $     %     6/30/2016     6/30/2015  

Mortgage loans on real estate

                  

Construction and development

   $ 101,080      $ 95,353      $ 70,927      $ 5,727        6.0   $ 30,153        42.5     12.4     12.0

1-4 Family

     166,778        162,312        153,118        4,466        2.8        13,660        8.9        20.4        20.3   

Multifamily

     37,300        33,609        21,260        3,691        11.0        16,040        75.4        4.6        4.2   

Farmland

     8,343        6,366        3,001        1,977        31.1        5,342        178.0        1.0        0.8   

Commercial real estate

                  

Owner-occupied

     151,464        141,583        129,825        9,881        7.0        21,639        16.7        18.5        17.8   

Nonowner-occupied

     180,842        174,176        119,321        6,666        3.8        61,521        51.6        22.1        21.8   

Commercial and industrial

     75,103        74,990        56,485        113        0.2        18,618        33.0        9.2        9.4   

Consumer

     96,560        109,233        119,649        (12,673     (11.6     (23,089     (19.3     11.8        13.7   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total loans

     817,470        797,622        673,586        19,848        2.5     143,884        21.4     100     100

Loans held for sale

     46,717        50,921        78,212        (4,204     (8.3     (31,495     (40.3    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

     

Total gross loans

   $   864,187      $   848,543      $     751,798      $   15,644        1.8   $ 112,389        14.9    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

     

Consumer loans, including consumer loans held for sale, totaled $143.3 million at June 30, 2016, a decrease of $16.7 million, or 10.5%, compared to $160.0 million at March 31, 2016, and a decrease of $49.3 million, or 25.6%, compared to June 30, 2015. The decrease compared to the linked quarter is mainly attributable to principal payments on consumer loan balances. Since the Bank discontinued accepting indirect auto loan applications at the end of 2015, which was the primary source of its consumer loan portfolio and consumer loans held for sale, the consumer loan portfolio is expected to decrease over time. The Bank currently has the intent and ability to sell the balance of the consumer loans classified as held for sale at June 30, 2016, however, if this classification were to change, the loans would be transferred to the consumer loan portfolio.

At June 30, 2016, the Company’s total business lending portfolio, which consists of loans secured by owner-occupied commercial real estate properties and commercial and industrial loans, was $226.6 million, an increase of $10.0 million, or 4.6%, compared to the business lending portfolio of $216.6 million at March 31, 2016 and an increase of $40.3 million, or 21.6%, compared to the business lending portfolio of $186.3 million at June 30, 2015.

Credit Quality

Nonperforming loans were $5.5 million, or 0.67% of total loans, at June 30, 2016, an increase of $3.2 million, or 136.9%, compared to $2.3 million, or 0.29% of total loans, at March 31, 2016, and an increase of $2.8 million, or 103.7%, compared to $2.7 million, or 0.40% of total loans, at June 30, 2015. The allowance for loan losses was $7.1 million, or 129.6% and 0.87% of nonperforming loans and total loans, respectively, at June 30, 2016, compared to $6.5 million, or 279.8% and 0.81% of nonperforming loans and total loans, respectively, at March 31, 2016 and $5.7 million, or 213.2% and 0.85% of nonperforming loans and total loans, respectively, at June 30, 2015. The allowance for loan losses plus the fair value marks on acquired loans was 0.95% of total loans at June 30, 2016 compared to 0.90% at March 31, 2016 and 0.95% at June 30, 2015. The increase in nonperforming loans and the decrease in the allowance for loan losses as a percentage of nonperforming loans at June 30, 2016 when compared to both March 31, 2016 and June 30, 2015 are mainly attributable to a $2.7 million commercial and industrial loan relationship not related to the oil and gas industry. Management has evaluated the loan relationship, which is well collateralized and properly reserved, and expects it to be resolved without any additional material impact to the financial statements.

The provision for loan loss expense was $0.8 million for the second quarter of 2016, an increase of $0.3 million and $0.4 million compared to March 31, 2016 and June 30, 2015, respectively. The increase in the provision for loan loss expense can also be attributed to the $2.7 million loan relationship discussed above.


Management continues to monitor the Company’s loan portfolio for exposure to potential negative impacts of suppressed oil and gas prices. We consider our exposure to the energy sector not to be significant, at less than one percent of the total loan portfolio at June 30, 2016. However, should the price of oil and gas decline further and/or remain at the current low price for an extended period, the general economic conditions in our south Louisiana markets could be negatively affected and could negatively impact borrowers’ ability to service their debt. Management continually evaluates the allowance for loan losses based on several factors, including economic conditions, and currently believes that any potential negatively affected future cash flows related to these loans would be covered by the current allowance for loan losses.

Deposits

Total deposits at June 30, 2016 were $867.2 million, an increase of $58.5 million, or 7.2%, compared to March 31, 2016 and an increase of $161.2 million, or 22.8%, compared to June 30, 2015. The increase in total deposits was driven by an increase in noninterest-bearing deposits of $23.5 million, or 27.2%, an increase in money market accounts of $16.4 million, or 17.8%, and an increase in time deposits of $112.2 million, or 32.6%, compared to June 30, 2015.

The Company’s focus on relationship banking continues to positively impact noninterest-bearing demand deposit growth.

The following table sets forth the composition of the Company’s deposits as of the dates indicated (dollars in thousands).

 

                          Linked Qtr
Change
    Year/Year Change     Percentage of
Total Deposits
 
     6/30/2016      3/31/2016      6/30/2015      $      %     $      %     6/30/2016     6/30/2015  

Noninterest-bearing demand deposits

   $ 109,828       $ 95,033       $ 86,339       $ 14,795         15.6   $ 23,489         27.2     12.7     12.2

NOW accounts

     139,893         138,672         131,136         1,221         0.9        8,757         6.7        16.1        18.6   

Money market deposit accounts

     108,552         104,936         92,126         3,616         3.4        16,426         17.8        12.5        13.1   

Savings accounts

     52,899         52,285         52,546         614         1.2        353         0.7        6.1        7.4   

Time deposits

     456,033         417,772         343,860         38,261         9.2        112,173         32.6        52.6        48.7   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

Total deposits

   $ 867,205       $ 808,698       $ 706,007       $   58,507         7.2   $ 161,198         22.8     100     100
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

Net Interest Income

Net interest income for the second quarter of 2016 totaled $8.7 million, an increase of $0.1 million, or 1.3%, compared to the first quarter of 2016, and an increase of $0.9 million, or 11.3%, compared to the second quarter of 2015. The increase was a direct result of continued growth of the Company’s loan portfolio with an increase in net interest income of $1.5 million due to an increase in volume offset by a $0.6 million decrease related to a reduction in yield compared to the second quarter of 2015.

The Company’s net interest margin was 3.38% for the quarter ended June 30, 2016 compared to 3.47% for the first quarter of 2016 and 3.70% for the second quarter of 2015. The yield on interest-earning assets was 4.18% for the quarter ended June 30, 2016 compared to 4.21% for the first quarter of 2016 and 4.37% for the second quarter of 2015.

The cost of deposits increased six basis points for the quarter ended June 30, 2016 compared to the first quarter of 2016, and increased twelve basis points compared to the second quarter of 2015. The increase is primarily a result of increases in time deposit rates.

Noninterest Income

Noninterest income for the second quarter of 2016 totaled $2.3 million, an increase of $1.0 million, or 75.3%, compared to the first quarter of 2016, and an increase of $0.2 million, or 9.2%, compared to the second quarter of 2015. The increase in noninterest income when compared to March 31, 2016 is mainly attributable to the $1.3 million gain on sale of fixed assets recognized for the sale of the land and building of one of the Bank’s branch locations to a healthcare company. The increase in gain on sale of fixed assets was offset by a $0.3 million decrease in the gain on sale of loans. Since exiting the indirect auto loan origination business at the end of 2015, the Bank has experienced decreased loan sales and has ceased originations of consumer loans held for sale. The Bank does intend to sell the balance of the consumer loans held for sale at June 30, 2016, however, it expects the gain on sale of loans to diminish over time.

Noninterest Expense

Noninterest expense for the second quarter of 2016 totaled $7.1 million, an increase of $0.7 million, or 11.3%, compared to the first quarter of 2016, and an increase of $0.4 million, or 6.3%, compared to the second quarter of 2015. The increase in noninterest expense compared to the first quarter of 2016 is primarily due to $0.6 million in customer reimbursements that we paid to certain borrowers during the second quarter.


Basic Earnings Per Share and Diluted Earnings Per Share

The Company reported both basic and diluted earnings per share of $0.28 for the three months ended June 30, 2016, an increase of $0.03, compared to basic and diluted earnings per share of $0.25 for the three months ended June 30, 2015.

Taxes

The Company recorded income tax expense of $1.0 million for the quarter ended June 30, 2016, which equates to an effective tax rate of 33.4%.

About Investar Holding Corporation

Investar Holding Corporation, headquartered in Baton Rouge, Louisiana, provides full banking services, excluding trust services, through its wholly-owned banking subsidiary, Investar Bank, a state chartered bank. The Company’s primary market is South Louisiana and it currently operates 10 full service banking offices located throughout its market. At June 30, 2016, the Company had 152 full-time equivalent employees.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles in the United States of America, or GAAP. These measures and ratios include “tangible common equity,” “tangible assets,” “tangible equity to tangible assets,” and “tangible book value per common share.” Management believes these non-GAAP financial measures provide information useful to investors in understanding the Company’s financial results, and the Company believes that its presentation, together with the accompanying reconciliations, provide a more complete understanding of factors and trends affecting the Company’s business and allow investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results, and the Company strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names. A reconciliation of the non-GAAP financial measures disclosed in this press release to the comparable GAAP financial measures is included at the end of the financial statement tables.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the Company’s current views with respect to, among other things, future events and financial performance. The Company generally identifies forward-looking statements by terminology such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of those words or other comparable words. Any forward-looking statements contained in this press release are based on the historical performance of the Company and its subsidiaries or on the Company’s current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by the Company that the future plans, estimates or expectations by the Company will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to the Company’s operations, financial results, financial condition, business prospects, growth strategy and liquidity. If one or more of these or other risks or uncertainties materialize, or if the Company’s underlying assumptions prove to be incorrect, the Company’s actual results may vary materially from those indicated in these statements. The Company does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements. These factors include, but are not limited to, the following, any one or more of which could materially affect the outcome of future events:

 

   

business and economic conditions generally and in the financial services industry in particular, whether nationally, regionally or in the markets in which we operate;

   

our ability to achieve organic loan and deposit growth, and the composition of that growth;

   

changes (or the lack of changes) in interest rates, yield curves and interest rate spread relationships that affect our loan and deposit pricing;

   

the extent of continuing client demand for the high level of personalized service that is a key element of our banking approach as well as our ability to execute our strategy generally;

   

our dependence on our management team, and our ability to attract and retain qualified personnel;

   

changes in the quality or composition of our loan or investment portfolios, including adverse developments in borrower industries or in the repayment ability of individual borrowers;

   

inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates;

   

the concentration of our business within our geographic areas of operation in Louisiana; and

   

concentration of credit exposure.


These factors should not be construed as exhaustive. Additional information on these and other risk factors can be found in Item 1A. “Risk Factors” and Item 7. “Special Note Regarding Forward-Looking Statements” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, filed with the Securities and Exchange Commission.

For further information contact:

Investar Holding Corporation

Chris Hufft

Chief Financial Officer

(225) 227-2215

Chris.Hufft@investarbank.com


INVESTAR HOLDING CORPORATION

SUMMARY FINANCIAL INFORMATION

(Amounts in thousands, except share data)

(Unaudited)

 

     As of and for the three months ended  
     6/30/2016      3/31/2016      6/30/2015      Linked
Quarter
     Year/Year  

EARNINGS DATA

              

Total interest income

   $ 10,719       $ 10,378       $ 9,187         3.3      16.7

Total interest expense

     2,061         1,831         1,407         12.6      46.5
  

 

 

    

 

 

    

 

 

       

Net interest income

     8,658         8,547         7,780         1.3      11.3

Provision for loan losses

     800         454         400         76.2      100.0

Total noninterest income

     2,256         1,287         2,066         75.3      9.2

Total noninterest expense

     7,104         6,384         6,682         11.3      6.3
  

 

 

    

 

 

    

 

 

       

Income before income taxes

     3,010         2,996         2,764         0.5      8.9

Income tax expense

     1,005         1,006         951         -0.1      5.7
  

 

 

    

 

 

    

 

 

       

Net income

   $ 2,005       $ 1,990       $ 1,813         0.8      10.6
  

 

 

    

 

 

    

 

 

       
              

AVERAGE BALANCE SHEET DATA

              

Total assets

   $         1,086,604       $         1,044,993       $ 891,581         4.0      21.9

Total interest-earning assets

     1,028,360         988,779         842,984         4.0      22.0

Total loans

     800,710         767,761         664,607         4.3      20.5

Total gross loans

     852,475         832,368         729,851         2.4      16.8

Total interest-bearing deposits

     739,678         676,826         617,442         9.3      19.8

Total interest-bearing liabilities

     866,386         836,332         694,497         3.6      24.8

Total deposits

     835,215         764,145         699,151         9.3      19.5

Total shareholders’ equity

     112,035         110,873         106,583         1.0      5.1
              

PER SHARE DATA

              

Earnings:

              

Basic earnings per share

   $ 0.28       $ 0.28       $ 0.25         0.0      12.0

Diluted earnings per share

     0.28         0.28         0.25         0.0      12.0

Book value per share

     15.63         15.28         14.65         2.3      6.7

Tangible book value per share (1)

     15.18         14.83         14.22         2.4      6.8

Common shares outstanding

     7,214,734         7,296,426                 7,293,209         -1.1      -1.1
              

PERFORMANCE RATIOS

              

Return on average assets

     0.74      0.76      0.82      -2.6      -9.8

Return on average equity

     7.18      7.20      6.82      -0.3      5.3

Net interest margin

     3.38      3.47      3.70      -2.6      -8.6

Net interest income to average assets

     3.20      3.28      3.50      -2.4      -8.6

Noninterest expense to average assets

     2.62      2.45      3.01      6.9      -13.0

Efficiency ratio (2)

     65.09      64.92      67.87      0.3      -4.1

Dividend payout ratio

     3.57      3.25      3.11      9.8      14.8

Net charge-offs to average loans

     0.02      0.02      0.00      0.0      0.0

 

(1) Non-GAAP financial measure. See reconciliation.

(2) Efficiency ratio represents noninterest expenses divided by the sum of net interest income (before provision for loan losses) and noninterest income.


INVESTAR HOLDING CORPORATION

SUMMARY FINANCIAL INFORMATION

(Amounts in thousands, except share data)

(Unaudited)

   
   
   
   
     As of and for the three months ended  
     6/30/2016      3/31/2016      6/30/2015      Linked
Quarter
     Year/Year  

ASSET QUALITY RATIOS

              

Nonperforming assets to total assets

     0.51      0.28      0.56      82.1      -8.9

Nonperforming loans to total loans

     0.67      0.29      0.40      131.0      67.5

Allowance for loan losses to total loans

     0.87      0.81      0.85      7.4      2.4

Allowance for loan losses to nonperforming loans

     129.6      279.75      213.20      -53.7      -39.2
              

CAPITAL RATIOS

              

Investar Holding Corporation:

              

Total equity to total assets

     10.01      10.39      11.59      -3.7      -13.6

Tangible equity to tangible assets

     9.75      10.11      11.29      -3.6      -13.6

Tier 1 leverage ratio

     10.46      10.78      12.15      -3.0      -13.9

Common equity tier 1 capital ratio

     11.11      11.49      12.96      -3.3      -14.3

Tier 1 capital ratio

     11.47      11.86      13.39      -3.3      -14.3

Total capital ratio

     12.19      12.54      14.10      -2.8      -13.5

Investar Bank:

              

Tier 1 leverage ratio

     10.26      10.52      11.72      -2.5      -12.5

Common equity tier 1 capital ratio

     11.25      11.57      12.91      -2.8      -12.9

Tier 1 capital ratio

     11.25      11.57      12.91      -2.8      -12.9

Total capital ratio

     11.97      12.25      13.62      -2.3      -12.1


INVESTAR HOLDING CORPORATION

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)

(Unaudited)

 

     June 30, 2016     March 31, 2016     June 30, 2015  

ASSETS

      

Cash and due from banks

   $ 9,958      $ 8,808      $ 7,541   

Interest-bearing balances due from other banks

     27,175        12,465        16,807   

Federal funds sold

     1        51        191   
  

 

 

   

 

 

   

 

 

 

Cash and cash equivalents

     37,134        21,324        24,539   
      

Available for sale securities at fair value (amortized cost of $149,986, $127,737, and $82,049, respectively)

     151,841        128,570        82,236   

Held to maturity securities at amortized cost (estimated fair value of $25,810, $26,348, and $24,015, respectively)

     25,656        26,249        24,230   

Loans held for sale

     46,717        50,921        78,212   

Loans, net of allowance for loan losses of $7,091, $6,463, and $5,728, respectively

     810,379        791,159        667,858   

Other equity securities

     7,371        7,183        4,183   

Bank premises and equipment, net of accumulated depreciation of $6,017, $5,727, and $4,662, respectively

     30,147        30,759        29,444   

Other real estate owned, net

     279        695        2,519   

Accrued interest receivable

     2,840        2,978        2,432   

Deferred tax asset

     1,459        1,934        1,624   

Goodwill and other intangible assets

     3,254        3,265        3,195   

Bank-owned life insurance

     7,101        7,054        -   

Other assets

     2,752        1,438        1,383   
  

 

 

   

 

 

   

 

 

 

Total assets

   $         1,126,930      $         1,073,529      $         921,855   
  

 

 

   

 

 

   

 

 

 
      

LIABILITIES

      

Deposits

      

Noninterest-bearing

   $ 109,828      $ 95,033      $ 86,339   

Interest-bearing

     757,377        713,665        619,668   
  

 

 

   

 

 

   

 

 

 

Total deposits

     867,205        808,698        706,007   

Advances from Federal Home Loan Bank

     93,599        103,960        79,066   

Repurchase agreements

     28,854        29,678        15,130   

Junior subordinated debt

     3,609        3,609        3,609   

Accrued taxes and other liabilities

     20,900        16,097        11,170   
  

 

 

   

 

 

   

 

 

 

Total liabilities

     1,014,167        962,042        814,982   
      

STOCKHOLDERS’ EQUITY

      

Preferred stock, $1.00 par value per share; 5,000,000 shares authorized

     -        -        -   

Common stock, $1.00 par value per share; 40,000,000 shares authorized; 7,359,976, 7,358,231, and 7,294,987 shares issued and 7,214,734, 7,296,429, and 7,293,209 shares outstanding, respectively

     7,360        7,358        7,295   

Treasury stock

     (2,249     (952     (26

Surplus

     84,958        84,780        84,358   

Retained earnings

     22,507        20,575        15,461   

Accumulated other comprehensive income (loss)

     187        (274     (215
  

 

 

   

 

 

   

 

 

 

Total stockholders’ equity

     112,763        111,487        106,873   
  

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 1,126,930      $ 1,073,529      $ 921,855   
  

 

 

   

 

 

   

 

 

 


INVESTAR HOLDING CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share data)

(Unaudited)

 

     For the three months ended      For the six months ended  
     June 30, 2016      March 31, 2016      June 30, 2015      June 30, 2016      June 30, 2015  

INTEREST INCOME

              

Interest and fees on loans

   $ 9,781       $ 9,485       $ 8,646       $ 19,266       $ 16,944   

Interest on investment securities

     891         856         523         1,747         1,008   

Other interest income

     47         37         18         84         35   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total interest income

     10,719         10,378         9,187         21,097         17,987   
              

INTEREST EXPENSE

              

Interest on deposits

     1,763         1,515         1,299         3,278         2,491   

Interest on borrowings

     298         316         108         614         217   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total interest expense

     2,061         1,831         1,407         3,892         2,708   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net interest income

     8,658         8,547         7,780         17,205         15,279   
              

Provision for loan losses

     800         454         400         1,254         1,100   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net interest income after provision for loan losses

     7,858         8,093         7,380         15,951         14,179   
              

NONINTEREST INCOME

              

Service charges on deposit accounts

     88         97         97         185         191   

Gain on sale of investment securities, net

     144         80         134         224         134   

Gain on sale of fixed assets, net

     1,252         -         -         1,252         -   

Gain on sale of real estate owned, net

     10         1         7         11         6   

Gain on sale of loans, net

     -         313         1,077         313         2,808   

Fee income on loans held for sale, net

     106         123         210         229         510   

Servicing fees

     431         468         373         899         653   

Other operating income

     225         205         168         430         304   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total noninterest income

     2,256         1,287         2,066         3,543         4,606   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Income before noninterest expense

             10,114                 9,380                 9,446                 19,494                 18,785   
              

NONINTEREST EXPENSE

              

Depreciation and amortization

     369         370         362         739         719   

Salaries and employee benefits

     3,890         3,873         3,971         7,763         7,879   

Occupancy

     242         236         225         478         438   

Data processing

     367         374         370         741         710   

Marketing

     102         112         62         214         120   

Professional fees

     375         279         237         654         499   

Customer reimbursements

     584         -         -         584         -   

Other operating expenses

     1,175         1,140         1,455         2,315         2,741   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total noninterest expense

     7,104         6,384         6,682         13,488         13,106   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Income before income tax expense

     3,010         2,996         2,764         6,006         5,679   

Income tax expense

     1,005         1,006         951         2,011         1,916   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net income

   $ 2,005       $ 1,990       $ 1,813       $ 3,995       $ 3,763   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
              

EARNINGS PER SHARE

              

Basic earnings per share

   $ 0.28       $ 0.28       $ 0.25       $ 0.56       $ 0.52   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Diluted earnings per share

   $ 0.28       $ 0.28       $ 0.25       $ 0.55       $ 0.52   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Cash dividends declared per common share

   $ 0.01       $ 0.01       $ 0.01       $ 0.02       $ 0.02   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 


INVESTAR HOLDING CORPORATION

EARNINGS PER COMMON SHARE

(Amounts in thousands, except share data)

(Unaudited)

 

     For the three months ended      For the six months ended  
     June 30, 2016      March 31, 2016      June 30, 2015      June 30, 2016      June 30, 2015  

Net income available to common shareholders

   $ 2,005       $ 1,990       $ 1,813       $ 3,995       $ 3,763   
Weighted average number of common shares outstanding used in computation of basic earnings per common share      7,158,532         7,194,558         7,219,593         7,176,545         7,219,415   

Effect of dilutive securities:

              

Restricted stock

     15,298         15,353         13,372         12,705         11,065   

Stock options

     14,715         14,854         16,725         14,752         13,478   

Stock warrants

     11,231         11,267         12,467         11,249         10,765   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Weighted average number of common shares outstanding plus effect of dilutive securities used in computation of diluted earnings per common share      7,199,776         7,236,032         7,262,157         7,215,251         7,254,723   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Basic earnings per share

   $ 0.28       $ 0.28       $ 0.25       $ 0.56       $ 0.52   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Diluted earnings per share

   $ 0.28       $ 0.28       $ 0.25       $ 0.55       $ 0.52   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 


INVESTAR HOLDING CORPORATION

CONSOLIDATED AVERAGE BALANCE SHEET, INTEREST EARNED AND YIELD ANALYSIS

(Amounts in thousands)

(Unaudited)

 

     For the three months ended  
     June 30, 2016     March 31, 2016     June 30, 2015  
     Average
Balance
    Interest
Income/
Expense
     Yield/
Rate
    Average
Balance
    Interest
Income/
Expense
     Yield/
Rate
    Average
Balance
    Interest
Income/
Expense
     Yield/
Rate
 

Assets

                     

Interest-earning assets:

                     

Loans

   $ 852,475      $ 9,781         4.60   $ 832,368      $ 9,485         4.57   $ 729,851      $ 8,646         4.75

Securities:

                     

Taxable

     129,126        732         2.27        113,446        712         2.52        77,050        404         2.10   

Tax-exempt

     25,105        159         2.54        22,199        144         2.60        18,948        119         2.52   

Interest-bearing balances with banks

     21,654        47         0.87        20,766        37         0.71        17,135        18         0.42   
  

 

 

   

 

 

      

 

 

   

 

 

      

 

 

   

 

 

    

Total interest-earning assets

     1,028,360            10,719             4.18        988,779            10,378             4.21        842,984            9,187             4.37   

Cash and due from banks

     7,647             7,222             5,432        

Intangible assets

     3,258             3,179             3,199        

Other assets

     54,123             52,121             45,532        

Allowance for loan losses

     (6,784          (6,308          (5,566     
  

 

 

        

 

 

        

 

 

      

Total assets

   $ 1,086,604           $     1,044,993           $     891,581        
  

 

 

        

 

 

        

 

 

      
                     

Liabilities and shareholders’ equity

                     

Interest-bearing liabilities:

                     

Deposits:

                     

Interest-bearing demand

   $ 247,052      $ 393         0.64   $ 239,844      $ 380         0.64   $ 222,130      $ 353         0.64

Savings deposits

     52,728        88         0.67        53,144        88         0.66        53,364        90         0.68   

Time deposits

     439,898        1,282         1.17        383,838        1,047         1.09        341,948        856         1.00   
  

 

 

   

 

 

      

 

 

   

 

 

      

 

 

   

 

 

    

Total interest-bearing deposits

     739,678        1,763         0.96        676,826        1,515         0.90        617,442        1,299         0.84   

Short-term borrowings

     103,274        229         0.89        132,839        243         0.73        36,977        16         0.17   

Long-term debt

     23,434        69         1.18        26,667        73         1.10        40,078        92         0.92   
  

 

 

   

 

 

      

 

 

   

 

 

      

 

 

   

 

 

    

Total interest-bearing liabilities

     866,386        2,061         0.95        836,332        1,831         0.88        694,497        1,407         0.81   

Noninterest-bearing deposits

     95,537             87,319             81,709        

Other liabilities

     12,646             10,469             8,792        

Stockholders’ equity

     112,035             110,873             106,583        
  

 

 

        

 

 

        

 

 

      

Total liability and stockholders’ equity

   $     1,086,604           $ 1,044,993           $ 891,581        
  

 

 

   

 

 

      

 

 

   

 

 

      

 

 

   

 

 

    

Net interest income/net interest margin

     $ 8,658         3.38     $ 8,547         3.47     $ 7,780         3.70
    

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

 


INVESTAR HOLDING CORPORATION

CONSOLIDATED AVERAGE BALANCE SHEET, INTEREST EARNED AND YIELD ANALYSIS

(Amounts in thousands)

(Unaudited)

     For the six months ended  
     June 30 2016     June 30, 2015  
     Average
Balance
    Interest
Income/
Expense
     Yield/
Rate
    Average
Balance
    Interest
Income/
Expense
     Yield/
Rate
 

Assets

              

Interest-earning assets:

              

Loans

   $ 842,420      $ 19,266         4.59   $ 722,136      $ 16,944         4.73

Securities:

              

Taxable

     121,286        1,444         2.39        72,812        770         2.13   

Tax-exempt

     23,652        303         2.57        18,963        238         2.53   

Interest-bearing balances with banks

     21,210        84         0.79        17,580        35         0.40   
  

 

 

   

 

 

      

 

 

   

 

 

    

Total interest-earning assets

     1,008,568        21,097         4.20        831,491        17,987         4.36   

Cash and due from banks

     7,435             5,560        

Intangible assets

     3,219             3,204        

Other assets

     53,123             45,396        

Allowance for loan losses

     (6,546          (5,295     
  

 

 

        

 

 

      

Total assets

   $ 1,065,799           $ 880,356        
  

 

 

        

 

 

      
              

Liabilities and shareholders’ equity

              

Interest-bearing liabilities:

              

Deposits:

              

Interest-bearing demand

   $ 243,448      $ 773         0.64   $ 213,477      $ 663         0.63

Savings deposits

     52,936        177         0.67        54,540        184         0.68   

Time deposits

     411,868        2,328         1.13        333,143        1,644         1.00   
  

 

 

   

 

 

      

 

 

   

 

 

    

Total interest-bearing deposits

     708,252        3,278         0.93        601,160        2,491         0.84   

Short-term borrowings

     118,056        473         0.80        45,145        40         0.18   

Long-term debt

     25,050        141         1.13        40,929        177         0.87   
  

 

 

   

 

 

      

 

 

   

 

 

    

Total interest-bearing liabilities

     851,358        3,892         0.92        687,234        2,708         0.79   

Noninterest-bearing deposits

     91,428             79,480        

Other liabilities

     11,559             7,888        

Stockholders’ equity

     111,454             105,754        
  

 

 

        

 

 

      

Total liability and stockholders’ equity

   $         1,065,799           $         880,356        
  

 

 

   

 

 

      

 

 

   

 

 

    

Net interest income/net interest margin

     $         17,205                 3.42     $         15,279                 3.71
    

 

 

    

 

 

     

 

 

    

 

 

 


INVESTAR HOLDING CORPORATION

RECONCILIATION OF NON GAAP FINANCIAL MEASURES

(Amounts in thousands, except share data)

(Unaudited)

 

     June 30, 2016     March 31, 2016     June 30, 2015  

Tangible common equity

      

Total stockholder’s equity

   $ 112,763      $ 111,487      $ 106,873   

Adjustments:

      

Goodwill

     2,684        2,684        2,684   

Core deposit intangible

     470        480        511   

Trademark intangible

     100        100     
  

 

 

   

 

 

   

 

 

 

Tangible common equity

   $ 109,509      $ 108,223      $ 103,678   
  

 

 

   

 

 

   

 

 

 

Tangible assets

      

Total assets

   $ 1,126,930      $ 1,073,529      $ 921,855   

Adjustments:

      

Goodwill

     2,684        2,684        2,684   

Core deposit intangible

     470        480        511   

Trademark intangible

     100        100        -   
  

 

 

   

 

 

   

 

 

 

Tangible assets

   $ 1,123,676      $ 1,070,265      $ 918,660   
  

 

 

   

 

 

   

 

 

 
      

Common shares outstanding

     7,214,734        7,296,429        7,293,209   

Tangible equity to tangible assets

     9.75     10.11     11.29

Book value per common share

   $ 15.63      $ 15.28      $ 14.65   

Tangible book value per common share

     15.18        14.83        14.22