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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): January 25, 2023
 

 
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.)
 
10500 Coursey Blvd.
Baton Rouge, Louisiana 70816
(Address of principal executive offices) (Zip Code)
 
Registrants 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 (see General Instruction A.2. below):
 
 
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))
 
Securities registered pursuant to Section 12(b) of the Act:
 
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common stock, $1.00 par value per share
ISTR
The Nasdaq Global Market
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
 

 
1

 
Item 2.02
Results of Operations and Financial Condition
 
On January 25, 2023, Investar Holding Corporation (the “Company”), the holding company of Investar Bank, National Association (the “Bank”), issued a press release reporting fourth quarter 2022 results. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
 
The information contained in Item 2.02, including Exhibit 99.1 of 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
 
104
 
The cover page of Investar Holding Corporation’s Form 8-K is formatted in Inline XBRL.
 
2

 
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: January 26, 2023
By:
/s/ John J. D’Angelo
   
John J. D’Angelo
   
President and Chief Executive Officer
 
3
EX-99.1 2 ex_450214.htm EXHIBIT 99.1 ex_450214.htm

Exhibit 99.1

 

For Immediate Release

 

Investar Holding Corporation Announces 2022 Fourth Quarter Results

 

 

BATON ROUGE, LA / ACCESSWIRE / January 25, 2023 / Investar Holding Corporation (“Investar”) (NASDAQ:ISTR), the holding company for Investar Bank, National Association (the “Bank”), today announced financial results for the quarter ended December 31, 2022. Investar reported net income of $8.9 million, or $0.88 per diluted common share, for the fourth quarter of 2022, compared to net income of $7.3 million, or $0.73 per diluted common share, for the quarter ended September 30, 2022, and net income of $6.9 million, or $0.67 per diluted common share, for the quarter ended December 31, 2021

 

On a non-GAAP basis, core earnings per diluted common share for the fourth quarter of 2022 were $0.62 compared to $0.71 for the third quarter of 2022 and $0.56 for the fourth quarter of 2021. Core earnings exclude certain non-operating items including, but not limited to, income from insurance proceeds, loss on sale or disposition of fixed assets, severance, and the Employee Retention Credit (“ERC”) (refer to the Reconciliation of Non-GAAP Financial Measures tables for a reconciliation of GAAP to non-GAAP metrics).

 

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

 

“This year presented unique challenges due to a rapidly rising interest rate environment and tightening financial conditions. Despite the effects of the macroeconomic environment, we reported record annual net income of $35.7 million. In the fourth quarter, we experienced strong organic loan growth of 5.0%, or 20.0% annualized, and the loan portfolio reached an all-time high of over $2.1 billion. Credit quality metrics improved further as nonperforming loans represented only 0.51% of total loans compared to 0.65% in the third quarter, and we continue to experience minimal loss from charge-offs. 

 

Loan yields increased in the fourth quarter as we originated new loans, completed renewals at higher rates, and realized the benefits of the variable rate portion of our loan portfolio. However, our cost of short-term borrowings increased as a result of interest rate hikes by the Federal Reserve, and we repriced deposits with a focus on short-term maturities to take market share in our core markets, which compressed our margin. In anticipation of a continued transitional interest rate environment, we have strategically positioned our balance sheet for long-term value creation.

 

We are also continually evaluating opportunities to reduce our physical branch footprint and further improve efficiency through digital initiatives. In the first quarter of 2023, the sale of our two south Texas branches is expected to close, and we will consolidate an additional branch located in our Louisiana market. While challenges remain, we are proactively identifying opportunities for improvement to add long-term value for our shareholders.”

 

Fourth Quarter Highlights

 

 

Total loans increased $99.1 million, or 4.9%, to $2.10 billion at December 31, 2022 compared to $2.01 billion at September 30, 2022, and increased $232.8 million, or 12.4%, compared to $1.87 billion at December 31, 2021. Excluding Paycheck Protection Program (“PPP”) loans, total loans increased $99.3 million, or 5.0% (20.0% annualized), to $2.10 billion at December 31, 2022 compared to $2.00 billion at September 30, 2022 and increased $254.4 million, or 13.8%, compared to December 31, 2021.

 

 

Commercial and industrial loans increased $37.3 million, or 9.4%, to $435.1 million at December 31, 2022 compared to $397.8 million at September 30, 2022, and increased $124.3 million, or 40.0%, compared to $310.8 million at December 31, 2021. Excluding PPP loans, commercial and industrial loans increased $37.6 million, or 9.5%, to $433.4 million at December 31, 2022 compared to $395.9 million at September 30, 2022 and increased $145.9 million, or 50.8%, compared to $287.5 million at December 31, 2021.

 

 

Credit quality continues to strengthen with nonperforming loans improving to 0.51% of total loans at December 31, 2022 compared to 0.65% and 1.58% at September 30, 2022 and December 31, 2021, respectively.

 

 

The yield on the loan portfolio increased to 5.07% for the quarter ended December 31, 2022 compared to 4.86% and 4.68% for the quarters ended September 30, 2022 and December 31, 2021, respectively.

 

 

1

 

 

Total deposits increased $29.7 million, or 1.4% (5.6% annualized), to $2.08 billion at December 31, 2022 compared to $2.05 billion at September 30, 2022. Total deposits decreased $37.9 million, or 1.8%, compared to $2.12 billion at December 31, 2021

 

 

Book value per common share increased to $21.79 at December 31, 2022, or 4.9% (19.6% annualized), compared to $20.78 at September 30, 2022 and decreased 7.1% compared to $23.45 at December 31, 2021. Tangible book value per common share increased to $17.43 at December 31, 2022, or 6.3% (25.2% annualized), compared to $16.40 at September 30, 2022 and decreased 9.2% compared to $19.20 at December 31, 2021.

 

 

Noninterest expense decreased $2.1 million, or 12.9%, to $13.9 million for the quarter ended December 31, 2022 compared to $16.0 million for the quarter ended September 30, 2022, and remained flat compared to $13.9 million for the quarter ended December 31, 2021. Core noninterest expense decreased to $15.6 million for the quarter ended December 31, 2022 compared to $16.0 million and $15.7 million for the quarters ended September 30, 2022 and December 31, 2021, respectively.

 

 

Return on average assets improved to 1.32% for the quarter ended December 31, 2022 compared to 1.11% for the quarter ended September 30, 2022 and 1.06% for the quarter ended December 31, 2021. Core return on average assets decreased to 0.92% for the quarter ended December 31, 2022 compared to 1.08% for the quarter ended September 30, 2022 and increased from 0.89% for the quarter ended December 31, 2021.

 

 

Efficiency ratio improved to 53.59% for the quarter ended December 31, 2022 compared to 61.10% for the quarter ended September 30, 2022 and 60.10% for the quarter ended December 31, 2021. Core efficiency ratio increased to 63.35% for the quarter ended December 31, 2022 compared to 61.63% for the quarter ended September 30, 2022 and improved from 66.54% for the quarter ended December 31, 2021.

 

Loans

 

Total loans were $2.10 billion at December 31, 2022an increase of $99.1 million, or 4.9%, compared to September 30, 2022, and an increase of $232.8 million, or 12.4%, compared to December 31, 2021

 

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

 

                           

Linked Quarter Change

   

Year/Year Change

   

Percentage of Total Loans

 
   

12/31/2022

   

9/30/2022

   

12/31/2021

   

$

   

%

   

$

   

%

   

12/31/2022

   

12/31/2021

 

Mortgage loans on real estate

                                                                       

Construction and development

  $ 201,633     $ 220,609     $ 203,204     $ (18,976 )     (8.6 )%   $ (1,571 )     (0.8 )%     9.6 %     10.9 %

1-4 Family

    401,377       391,857       364,307       9,520       2.4       37,070       10.2       19.1       19.4  

Multifamily

    81,812       57,306       59,570       24,506       42.8       22,242       37.3       3.9       3.2  

Farmland

    12,877       14,202       20,128       (1,325 )     (9.3 )     (7,251 )     (36.0 )     0.6       1.1  

Commercial real estate

                                                                       

Owner-occupied

    445,148       445,671       460,205       (523 )     (0.1 )     (15,057 )     (3.3 )     21.1       24.6  

Nonowner-occupied

    513,095       464,520       436,172       48,575       10.5       76,923       17.6       24.4       23.3  

Commercial and industrial

    435,093       397,759       310,831       37,334       9.4       124,262       40.0       20.7       16.6  

Consumer

    13,732       13,753       17,595       (21 )     (0.2 )     (3,863 )     (22.0 )     0.6       0.9  

Total loans

    2,104,767       2,005,677       1,872,012       99,090       4.9 %     232,755       12.4 %     100 %     100 %

Loans held for sale

                620                   (620 )     (100.0 )                

Total gross loans

  $ 2,104,767     $ 2,005,677     $ 1,872,632     $ 99,090       4.9 %   $ 232,135       12.4 %                

 

In the second quarter of 2020, the Bank began participating as a lender in the PPP as established by the CARES Act. The PPP loans are generally 100% guaranteed by the Small Business Administration (“SBA”), have an interest rate of 1%, and are eligible to be forgiven based on certain criteria, with the SBA remitting any applicable forgiveness amount to the lender. At December 31, 2022, the balance of the Bank’s PPP loans, which is included in the commercial and industrial portfolio, was $1.7 million, compared to $1.9 million at September 30, 2022 and $23.3 million at December 31, 2021. At December 31, 2022, approximately 99% of the total balance of PPP loans originated had been forgiven by the SBA or paid off by the customer.
 

At December 31, 2022, Investar’s total business lending portfolio, which consists of loans secured by owner-occupied commercial real estate properties and commercial and industrial loans, was $880.2 million, an increase of $36.8 million, or 4.4%, compared to the business lending portfolio of $843.4 million at September 30, 2022, and an increase of $109.2 million, or 14.2%, compared to the business lending portfolio of $771.0 million at December 31, 2021. The increase in the business lending portfolio compared to September 30, 2022 and December 31, 2021 is primarily driven by increased loan production by our Commercial and Industrial Division, partially offset by the forgiveness of PPP loans and a decrease in owner-occupied commercial real estate loans. 

 

Nonowner-occupied loans totaled $513.1 million at December 31, 2022an increase of $48.6 million, or 10.5%, compared to $464.5 million at September 30, 2022, and an increase of $76.9 million, or 17.6%, compared to $436.2 million at December 31, 2021. The increase in nonowner-occupied loans compared to September 30, 2022 and December 31, 2021 is due to organic growth.

 

Credit Quality

 

Nonperforming loans were $10.7 million, or 0.51% of total loans, at December 31, 2022a decrease of $2.4 million compared to $13.1 million, or 0.65% of total loans, at September 30, 2022, and a decrease of $18.8 million compared to $29.5 million, or 1.58% of total loans, at December 31, 2021. The decrease in nonperforming loans compared to December 31, 2021 is mainly attributable to a large paydown on the loan relationship that was impaired as a result of Hurricane Ida in the third quarter of 2021, as well as continued efforts to reduce our exposure to one commercial and industrial oil and gas loan relationship during the quarter ended December 31, 2022. Included in nonperforming loans are acquired loans with a balance of $2.0 million at December 31, 2022, or 19% of nonperforming loans.

 

The allowance for loan losses was $24.4 million, or 228.4% and 1.16% of nonperforming and total loans, respectively, at December 31, 2022, compared to $23.2 million, or 176.6% and 1.15%, respectively, at September 30, 2022, and $20.9 million, or 70.6% and 1.11%, respectively, at December 31, 2021.

 

The provision for loan losses was $1.3 million for the quarter ended December 31, 2022 compared to $1.2 million and $0.7 million for the quarters ended September 30, 2022 and December 31, 2021, respectively. The increase in the provision for loan losses compared to the quarters ended September 30, 2022 and December 31, 2021, is primarily attributable to organic loan growth.

 

Deposits

 

Total deposits at December 31, 2022 were $2.08 billion, an increase of $29.7 million, or 1.4%, compared to $2.05 billion at September 30, 2022, and a decrease of $37.9 million, or 1.8%, compared to $2.12 billion at December 31, 2021. The increase in time deposits compared to September 30, 2022 and December 31, 2021 is due to increased rates offered to remain competitive in our markets, as we adjusted our strategy in response to the rising interest rate environment after running off higher yielding time deposits through the end of the second quarter. The decreases in the remaining categories compared to September 30, 2022 and December 31, 2021 are primarily driven by customers drawing down on their existing deposit accounts. During 2021 we experienced large increases in both noninterest and interest-bearing demand deposits, and in money market deposit accounts and savings accounts, primarily driven by reduced spending by consumer and business customers related to the COVID-19 pandemic, and increases in PPP borrowers’ deposit accounts.

 

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

 

                                                           

Percentage of

 
                           

Linked Quarter Change

   

Year/Year Change

   

Total Deposits

 
   

12/31/2022

   

9/30/2022

   

12/31/2021

   

$

   

%

   

$

   

%

   

12/31/2022

   

12/31/2021

 

Noninterest-bearing demand deposits

  $ 580,741     $ 590,610     $ 585,465     $ (9,869 )     (1.7 )%   $ (4,724 )     (0.8 )%     27.9 %     27.6 %

Interest-bearing demand deposits

    565,598       624,025       650,868       (58,427 )     (9.4 )     (85,270 )     (13.1 )     27.1       30.7  

Money market deposit accounts

    208,596       251,213       255,501       (42,617 )     (17.0 )     (46,905 )     (18.4 )     10.0       12.1  

Savings accounts

    155,176       167,131       180,837       (11,955 )     (7.2 )     (25,661 )     (14.2 )     7.5       8.5  

Time deposits

    572,254       419,704       447,595       152,550       36.3       124,659       27.9       27.5       21.1  

Total deposits

  $ 2,082,365     $ 2,052,683     $ 2,120,266     $ 29,682       1.4 %   $ (37,901 )     (1.8 )%     100.0 %     100.0 %

 

Stockholders’ Equity

 

Stockholders’ equity was $215.8 million at December 31, 2022an increase of $10.1 million, or 4.9%, compared to September 30, 2022, and a decrease of $26.8 million, or 11.1%, compared to December 31, 2021. The increase in stockholders’ equity compared to September 30, 2022 is primarily attributable to the net income for the quarter along with a decrease in accumulated other comprehensive loss due to an increase in the fair value of the Bank’s available for sale securities portfolio. The decrease in stockholders’ equity compared to December 31, 2021 is primarily attributable to an increase in accumulated other comprehensive loss due to a decrease in the fair value of the Bank’s available for sale securities portfolio, partially offset by net income for fiscal year 2022.

 

Net Interest Income

 

Net interest income for the fourth quarter of 2022 totaled $22.5 million, a decrease of $0.9 million, or 4.0%, compared to the third quarter of 2022, and an increase of $1.1 million, or 4.9%, compared to the fourth quarter of 2021. Included in net interest income for the quarters ended December 31, 2022September 30, 2022 and December 31, 2021 is $0.1 million, $0.1 million, and $0.2 million, respectively, of interest income accretion from the acquisition of loans. Also included in net interest income for the quarters ended September 30, 2022 and December 31, 2021 are interest recoveries of $0.1 million and $0.1 million, respectively. There were no interest recoveries for the quarter ended December 31, 2022.

 

2

 

Investar’s net interest margin was 3.50% for the quarter ended December 31, 2022, compared to 3.77% for the quarter ended September 30, 2022 and 3.57% for the quarter ended December 31, 2021. The decrease in net interest margin for the quarter ended December 31, 2022 compared to the quarter ended September 30, 2022 was driven by a 66 basis point increase in the overall cost of funds, partially offset by a 23 basis point increase in the yield on interest-earning assets. The decrease in net interest margin for the quarter ended December 31, 2022 compared to the quarter ended December 31, 2021 was driven by a 93 basis point increase in the overall cost of funds, partially offset by a 62 basis point increase in the yield on interest-earning assets.

 

The yield on interest-earning assets was 4.57% for the quarter ended December 31, 2022, compared to 4.34% for the quarter ended September 30, 2022 and 3.95% for the quarter ended December 31, 2021. The increase in the yield on interest-earning assets compared to the quarter ended September 30, 2022 was driven by a 21 basis point increase in the yield on our loan portfolio and a 17 basis point increase in the yield on the taxable securities portfolio. The increase in the yield on interest-earning assets compared to the quarter ended December 31, 2021 was driven by a 39 basis point increase in the yield on our loan portfolio and a 94 basis point increase in the yield on the taxable securities portfolio.

 

Exclusive of PPP loans, which had an average balance of $1.9 million and related interest and fee income of $9,000 for the quarter ended December 31, 2022, compared to an average balance of $2.5 million and related interest and fee income of $0.1 million for the quarter ended September 30, 2022 and an average balance of $33.2 million and related interest and fee income of $1.0 million for the quarter ended December 31, 2021, adjusted net interest margin was 3.50% for the quarter ended December 31, 2022, compared to an adjusted net interest margin of 3.76% for the quarter ended September 30, 2022 and 3.46% for the quarter ended December 31, 2021. Included in PPP interest and fee income for the quarters ended September 30, 2022 and December 31, 2021 is $0.1 million and $0.8 million, respectively, of accelerated fee income recognized due to the forgiveness or pay-off of PPP loans prior to maturity. There was no accelerated fee income recognized due to the forgiveness or pay-off of PPP loans prior to maturity during the quarter ended December 31, 2022. Refer to the Reconciliation of Non-GAAP Financial Measures table for a reconciliation of GAAP to non-GAAP metrics.

 

Exclusive of the interest income accretion from the acquisition of loans, interest recoveries, and accelerated fee income recognized due to the forgiveness or pay-off of PPP loans, all discussed above, adjusted net interest margin decreased to 3.49% for the quarter ended December 31, 2022, compared to 3.72% for the quarter ended September 30, 2022, and increased compared to 3.38% for the quarter ended December 31, 2021. The adjusted yield on interest-earning assets was 4.56% for the quarter ended December 31, 2022 compared to 4.29% and 3.76% for the quarters ended September 30, 2022 and December 31, 2021, respectively. Refer to the Reconciliation of Non-GAAP Financial Measures table for a reconciliation of GAAP to non-GAAP metrics.

 

The cost of deposits increased 46 basis points to 0.82% for the quarter ended December 31, 2022 compared to 0.36% for the quarter ended September 30, 2022 and increased 52 basis points compared to 0.30% for the quarter ended December 31, 2021. The increase in the cost of deposits compared to the quarters ended September 30, 2022 and December 31, 2021 resulted from both a higher average balance and an increase in rates paid on time deposits and from an increase in rates paid on interest-bearing demand deposits.

 

The cost of short-term borrowings increased 149 basis points to 3.89% for the quarter ended December 31, 2022 compared to 2.40% for the quarter ended September 30, 2022 and increased 367 basis points compared to 0.22% for the quarter ended December 31, 2021. The increase in the cost of short-term borrowings compared to the quarters ended September 30, 2022 and December 31, 2021 resulted from both a higher average balance and an increase in rates paid on short-term advances from the Federal Home Loan Bank, the cost of which is driven by the Federal Reserves federal funds rate.

 

The overall costs of funds for the quarter ended December 31, 2022 increased 66 basis points to 1.45% compared to 0.79% for the quarter ended September 30, 2022 and increased 93 basis points compared to 0.52% for the quarter ended December 31, 2021. The increase in the cost of funds for the quarter ended December 31, 2022 compared to the quarters ended September 30, 2022 and December 31, 2021 resulted from both a higher average balance and an increased cost of short-term borrowings and an increase in the cost of deposits.

 

Noninterest Income

 

Noninterest income for the fourth quarter of 2022 totaled $3.4 million, an increase of $0.8 million, or 29.1%, compared to the third quarter of 2022 and an increase of $1.8 million, or 104.7%, compared to the fourth quarter of 2021.

 

The increase in noninterest income compared to the quarter ended September 30, 2022 was primarily due to nontaxable income from insurance proceeds of $1.4 million recorded in the fourth quarter of 2022 related to an insurance policy for a former executive officer of the Company and the Bank, partially offset by a $0.6 million decrease in other operating income. The decrease in other operating income was primarily attributable to a $0.4 million decrease in the change in the net asset value of other investments and a $0.2 million decrease in derivative fee income. The increase in noninterest income compared to the quarter ended December 31, 2021 was primarily due to the $1.4 million in nontaxable income from insurance proceeds recorded in the fourth quarter of 2022 and a decrease of $0.3 million in loss on sale or disposition of fixed assets as a result of the Banks reclassification of two previous branch locations, totaling $1.9 million, to other real estate owned, net in the fourth quarter of 2021. 

 

Noninterest Expense

 

Noninterest expense for the fourth quarter of 2022 totaled $13.9 million, a decrease of $2.1 million, or 12.9%, compared to the third quarter of 2022, and remained flat compared to the fourth quarter of 2021

 

The decrease in noninterest expense for the quarter ended December 31, 2022 compared to the quarter ended September 30, 2022 was driven by a $1.8 million decrease in salaries and employee benefits and a $0.3 million decrease in other operating expenses. The decrease in salaries and employee benefits was primarily due to a $2.3 million ERC related to the second quarter of 2021, which was recognized as a credit to payroll taxes in the quarter ended December 31, 2022, partially offset by $0.6 million in severance pursuant to a separation agreement with a former executive officer of the Company and the Bank. The decrease in other operating expenses is driven by a decrease in collection and repossession expenses, the majority of which were related to the impaired loan relationship discussed in “Loans - Credit Quality” above.

 

For the quarter ended December 31, 2022 compared to the quarter ended December 31, 2021 salaries and employee benefits increased by $0.4 million, while other operating expenses decreased by $0.4 million. The increase in salaries and employee benefits was driven by $0.6 million in severance for a former executive officer of the Company and the Bank, partially offset by a $0.4 million increase in the ERC recorded in the fourth quarter of 2022 compared to the $1.9 million ERC recorded in the fourth quarter of 2021 related to the first quarter of 2021.

 

3

 

Taxes

 

Investar recorded income tax expense of $1.9 million for the quarter ended December 31, 2022, which equates to an effective tax rate of 17.5%a decrease from the effective tax rates of 18.9% and 19.1% for the quarters ended September 30, 2022 and December 31, 2021, respectively. The decrease in the effective tax rate for the quarter ended December 31, 2022 compared to the quarters ended September 30, 2022 and December 31, 2021 primarily resulted from $1.4 million in nontaxable income from insurance proceeds recorded during the quarter.

 

Basic and Diluted Earnings Per Common Share

 

Investar reported basic and diluted earnings per common share of $0.90 and $0.88, respectively, for the quarter ended December 31, 2022, compared to basic and diluted earnings per common share of $0.74 and $0.73, respectively, for the quarter ended September 30, 2022, and basic and diluted earnings per common share of $0.67 for the quarter ended December 31, 2021.

 

About Investar Holding Corporation

 

Investar, headquartered in Baton Rouge, Louisiana, provides full banking services, excluding trust services, through its wholly-owned banking subsidiary, Investar Bank, National Association. The Bank currently operates 31 branch locations serving Louisiana, Texas, and Alabama. At December 31, 2022, the Bank had 335 full-time equivalent employees and total assets of $2.8 billion.

 

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,” “tangible book value per common share,” “core noninterest income,” “core earnings before noninterest expense,” “core noninterest expense,” “core earnings before income tax expense,” “core income tax expense,” “core earnings,” “core efficiency ratio,” “core return on average assets,” “core return on average equity,” “core basic earnings per share,” and “core diluted earnings per share.” We also present certain average loan, yield, net interest income and net interest margin data adjusted to show the effects of excluding PPP loans, accelerated fee income for PPP loans, interest recoveries, and interest income accretion from the acquisition of loans. Management believes these non-GAAP financial measures provide information useful to investors in understanding Investar’s financial results, and Investar believes that its presentation, together with the accompanying reconciliations, provide a more complete understanding of factors and trends affecting Investar’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 Investar 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.

 

4

 

Forward-Looking and Cautionary Statements

 

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect Investar’s current views with respect to, among other things, future events and financial performance. Investar 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 Investar and its subsidiaries or on Investar’s current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by Investar that the future plans, estimates or expectations by Investar will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to Investar’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 Investar’s underlying assumptions prove to be incorrect, Investar’s actual results may vary materially from those indicated in these statements. Investar 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:

 

 

the significant risks and uncertainties for our business, results of operations and financial condition, as well as our regulatory capital and liquidity ratios and other regulatory requirements in the United States caused by the ongoing COVID-19 pandemic and war in Ukraine, including but not limited to potential continued higher inflation and supply and labor constraints, which will depend on several factors, including the scope and duration of the pandemic and the war, their continued influence on the economy and financial markets, the impact on market participants on which we rely, and actions taken by governmental authorities and other third parties in response;

 

 

business and economic conditions generally and in the financial services industry in particular, whether nationally, regionally or in the markets in which we operate, including evolving risks to economic activity and our customers posed by the COVID-19 pandemic and the war in Ukraine and government actions taken to address their impact, the potential impact of the termination of various pandemic-related government support programs, and the potential impact of any future federal government shutdown and uncertainty relating to the federal government’s debt limit;

 

 

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, including potential continued increases in interest rates in 2023;

 

 

our ability to identify and enter into agreements to combine with attractive acquisition candidates, finance acquisitions, complete acquisitions after definitive agreements are entered into, and successfully integrate and grow acquired operations;

 

 

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, and the potential for higher realized or unrealized losses in our investment portfolio;

 

 

an anticipated increase in our allowance for loan losses in the first quarter of 2023 resulting from our adoption on January 1, 2023 of ASU 2016-13, and inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates;

 

 

the announced cessation of the remaining U.S. dollar LIBOR setting after June 30, 2023, and the related effect on our LIBOR-based financial products and contracts, including, but not limited to, hedging products, debt obligations, investments and loans;

 

 

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

 

 

concentration of credit exposure;

 

 

any deterioration in asset quality and higher loan charge-offs, and the time and effort necessary to resolve problem assets;

 

 

a reduction in liquidity, including as a result of a reduction in the amount of deposits we hold or other sources of liquidity;

 

 

ongoing disruptions in the oil and gas industry due to the significant fluctuations in the price of oil and natural gas;

 

 

data processing system failures and errors;

 

 

cyberattacks and other security breaches; and

 

 

hurricanes, tropical storms, tropical depressions, floods, winter storms, and other adverse weather events, all of which have affected the Company’s market areas from time to time; other natural disasters; oil spills and other man-made disasters; acts of terrorism, an outbreak or intensifying of hostilities including the war in Ukraine or other international or domestic calamities, acts of God and other matters beyond our control.

 

5

 

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 in the “Special Note Regarding Forward-Looking Statements” in Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Investar’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission (the “SEC”).

 

For further information contact:

 

Investar Holding Corporation

John J. D’Angelo

President and Chief Executive Officer 

(225) 227-2215

John.Dangelo@investarbank.com

 

6

 

INVESTAR HOLDING CORPORATION

SUMMARY FINANCIAL INFORMATION

(Amounts in thousands, except share data)

(Unaudited)

 

   

As of and for the three months ended

 
   

12/31/2022

   

9/30/2022

   

12/31/2021

   

Linked Quarter

   

Year/Year

 

EARNINGS DATA

                                       

Total interest income

  $ 29,372     $ 27,002     $ 23,753       8.8 %     23.7 %

Total interest expense

    6,853       3,535       2,286       93.9       199.8  

Net interest income

    22,519       23,467       21,467       (4.0 )     4.9  

Provision for loan losses

    1,268       1,162       658       9.1       92.7  

Total noninterest income

    3,441       2,665       1,681       29.1       104.7  

Total noninterest expense

    13,913       15,967       13,912       (12.9 )     0.0  

Income before income tax expense

    10,779       9,003       8,578       19.7       25.7  

Income tax expense

    1,881       1,699       1,642       10.7       14.6  

Net income

  $ 8,898     $ 7,304     $ 6,936       21.8       28.3  
                                         

AVERAGE BALANCE SHEET DATA

                                       

Total assets

  $ 2,677,604     $ 2,621,611     $ 2,595,211       2.1 %     3.2 %

Total interest-earning assets

    2,552,448       2,468,357       2,385,896       3.4       7.0  

Total loans

    2,033,117       1,954,493       1,885,979       4.0       7.8  

Total interest-bearing deposits

    1,482,268       1,456,826       1,597,556       1.7       (7.2 )

Total interest-bearing liabilities

    1,872,870       1,772,960       1,734,170       5.6       8.0  

Total deposits

    2,072,288       2,069,603       2,200,718       0.1       (5.8 )

Total stockholders’ equity

    211,585       226,624       241,465       (6.6 )     (12.4 )
                                         

PER SHARE DATA

                                       

Earnings:

                                       

Basic earnings per common share

  $ 0.90     $ 0.74     $ 0.67       21.6 %     34.3 %

Diluted earnings per common share

    0.88       0.73       0.67       20.5       31.3  

Core earnings(1):

                                       

Core basic earnings per common share(1)

    0.63       0.71       0.56       (11.3 )     12.5  

Core diluted earnings per common share(1)

    0.62       0.71       0.56       (12.7 )     10.7  

Book value per common share

    21.79       20.78       23.45       4.9       (7.1 )

Tangible book value per common share(1)

    17.43       16.40       19.20       6.3       (9.2 )

Common shares outstanding

    9,901,847       9,901,078       10,343,494       0.0       (4.3 )

Weighted average common shares outstanding - basic

    9,899,192       9,965,374       10,343,467       (0.7 )     (4.3 )

Weighted average common shares outstanding - diluted

    10,032,446       10,086,249       10,413,713       (0.5 )     (3.7 )
                                         

PERFORMANCE RATIOS

                                       

Return on average assets

    1.32 %     1.11 %     1.06 %     18.9 %     24.5 %

Core return on average assets(1)

    0.92       1.08       0.89       (14.8 )     3.4  

Return on average equity

    16.69       12.79       11.40       30.5       46.4  

Core return on average equity(1)

    11.66       12.46       9.59       (6.4 )     21.6  

Net interest margin

    3.50       3.77       3.57       (7.2 )     (2.0 )

Net interest income to average assets

    3.34       3.55       3.28       (5.9 )     1.8  

Noninterest expense to average assets

    2.06       2.42       2.13       (14.9 )     (3.3 )

Efficiency ratio(2)

    53.59       61.10       60.10       (12.3 )     (10.8 )

Core efficiency ratio(1)

    63.35       61.63       66.54       2.8       (4.8 )

Dividend payout ratio

    10.56       12.84       11.94       (17.8 )     (11.6 )

Net charge-offs to average loans

                0.02             (100.0 )

 

(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.

 

7

 

INVESTAR HOLDING CORPORATION

SUMMARY FINANCIAL INFORMATION

(Amounts in thousands, except share data)

(Unaudited)

 

   

As of and for the three months ended

 
   

12/31/2022

   

9/30/2022

   

12/31/2021

   

Linked Quarter

   

Year/Year

 

ASSET QUALITY RATIOS

                                       

Nonperforming assets to total assets

    0.41 %     0.58 %     1.28 %     (29.3 )%     (68.0 )%

Nonperforming loans to total loans

    0.51       0.65       1.58       (21.5 )     (67.7 )

Allowance for loan losses to total loans

    1.16       1.15       1.11       0.9       4.5  

Allowance for loan losses to nonperforming loans

    228.44       176.63       70.59       29.3       223.6  
                                         

CAPITAL RATIOS

                                       

Investar Holding Corporation:

                                       

Total equity to total assets

    7.84 %     7.73 %     9.65 %     1.4 %     (18.8 )%

Tangible equity to tangible assets(1)

    6.37       6.20       8.04       2.7       (20.8 )

Tier 1 leverage ratio

    8.53       8.48       8.12       0.6       5.0  

Common equity tier 1 capital ratio(2)

    9.41       9.65       9.45       (2.5 )     (0.4 )

Tier 1 capital ratio(2)

    9.81       10.08       9.90       (2.7 )     (0.9 )

Total capital ratio(2)

    12.74       13.15       12.99       (3.1 )     (1.9 )

Investar Bank:

                                       

Tier 1 leverage ratio

    9.89       9.84       9.60       0.5       3.0  

Common equity tier 1 capital ratio(2)

    11.37       11.70       11.72       (2.8 )     (3.0 )

Tier 1 capital ratio(2)

    11.37       11.70       11.72       (2.8 )     (3.0 )

Total capital ratio(2)

    12.43       12.77       12.75       (2.7 )     (2.6 )

 

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

(2) Estimated for December 31, 2022.

 

8

 

INVESTAR HOLDING CORPORATION

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)

(Unaudited)

 

   

December 31, 2022

   

September 30, 2022

   

December 31, 2021

 

ASSETS

                       

Cash and due from banks

  $ 30,056     $ 31,711     $ 38,601  

Interest-bearing balances due from other banks

    10,010       4,302       57,940  

Federal funds sold

    193             500  

Cash and cash equivalents

    40,259       36,013       97,041  
                         

Available for sale securities at fair value (amortized cost of $467,316, $477,242, and $356,639, respectively)

    405,167       413,186       355,509  

Held to maturity securities at amortized cost (estimated fair value of $7,922, $8,951, and $10,727, respectively)

    8,305       9,373       10,255  

Loans held for sale

                620  

Loans, net of allowance for loan losses of $24,364, $23,164, and $20,859, respectively

    2,080,403       1,982,513       1,851,153  

Equity securities

    27,254       26,629       16,803  

Bank premises and equipment, net of accumulated depreciation of $22,025, $21,421, and $19,149, respectively

    49,587       50,327       58,080  

Other real estate owned, net

    682       2,326       2,653  

Accrued interest receivable

    12,749       11,915       11,355  

Deferred tax asset

    16,438       16,587       2,239  

Goodwill and other intangible assets, net

    43,147       43,360       44,036  

Bank-owned life insurance

    57,379       57,033       51,074  

Other assets

    12,437       12,432       12,385  

Total assets

  $ 2,753,807     $ 2,661,694     $ 2,513,203  
                         

LIABILITIES

                       

Deposits

                       

Noninterest-bearing

  $ 580,741     $ 590,610     $ 585,465  

Interest-bearing

    1,501,624       1,462,073       1,534,801  

Total deposits

    2,082,365       2,052,683       2,120,266  

Advances from Federal Home Loan Bank

    387,000       333,100       78,500  

Federal funds purchased

          168        

Repurchase agreements

                5,783  

Subordinated debt, net of unamortized issuance costs

    44,225       44,201       42,989  

Junior subordinated debt

    8,515       8,484       8,384  

Accrued taxes and other liabilities

    15,920       17,358       14,683  

Total liabilities

    2,538,025       2,455,994       2,270,605  
                         

STOCKHOLDERS’ EQUITY

                       

Preferred stock, no par value per share; 5,000,000 shares authorized

                 

Common stock, $1.00 par value per share; 40,000,000 shares authorized; 9,901,847, 9,901,078, and 10,343,494 shares issued and outstanding, respectively

    9,902       9,901       10,343  

Surplus

    146,587       146,155       154,932  

Retained earnings

    108,206       100,247       76,160  

Accumulated other comprehensive (loss) income

    (48,913 )     (50,603 )     1,163  

Total stockholders’ equity

    215,782       205,700       242,598  

Total liabilities and stockholders’ equity

  $ 2,753,807     $ 2,661,694     $ 2,513,203  

 

9

 

INVESTAR HOLDING CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(Amounts in thousands, except share data)

(Unaudited)

 

   

For the three months ended

   

For the twelve months ended

 
    December 31, 2022     September 30, 2022     December 31, 2021     December 31, 2022     December 31, 2021  

INTEREST INCOME

                                       

Interest and fees on loans

  $ 25,958     $ 23,924     $ 22,248     $ 93,373     $ 90,230  

Interest on investment securities

    3,086       2,874       1,291       10,278       4,500  

Other interest income

    328       204       214       918       812  

Total interest income

    29,372       27,002       23,753       104,569       95,542  
                                         

INTEREST EXPENSE

                                       

Interest on deposits

    3,052       1,315       1,217       6,250       7,487  

Interest on borrowings

    3,801       2,220       1,069       8,534       4,241  

Total interest expense

    6,853       3,535       2,286       14,784       11,728  

Net interest income

    22,519       23,467       21,467       89,785       83,814  
                                         

Provision for loan losses

    1,268       1,162       658       2,922       22,885  

Net interest income after provision for loan losses

    21,251       22,305       20,809       86,863       60,929  
                                         

NONINTEREST INCOME

                                       

Service charges on deposit accounts

    799       820       674       3,090       2,422  

Gain on call or sale of investment securities, net

                      6       2,321  

Loss on sale or disposition of fixed assets, net

    (67 )     (103 )     (406 )     (258 )     (408 )

Gain (loss) on sale of other real estate owned, net

    2       50             9       (5 )

Swap termination fee income

                      8,077       1,835  

Gain on sale of loans

                80       37       199  

Servicing fees and fee income on serviced loans

    13       17       37       74       204  

Interchange fees

    492       511       527       2,036       1,920  

Income from bank owned life insurance

    346       341       308       1,305       1,146  

Change in the fair value of equity securities

    12       (27 )     10       (90 )     214  

Income from insurance proceeds

    1,384                   1,384        

Other operating income

    460       1,056       451       2,680       2,194  

Total noninterest income

    3,441       2,665       1,681       18,350       12,042  

Income before noninterest expense

    24,692       24,970       22,490       105,213       72,971  
                                         

NONINTEREST EXPENSE

                                       

Depreciation and amortization

    1,071       1,087       1,240       4,435       4,988  

Salaries and employee benefits

    7,545       9,345       7,146       34,974       35,527  

Occupancy

    713       810       778       2,915       2,753  

Data processing

    1,006       861       678       3,600       3,112  

Marketing

    74       84       106       262       275  

Professional fees

    436       460       467       1,774       1,585  

Loss on early extinguishment of subordinated debt

                      222        

Acquisition expense

                            2,448  

Other operating expenses

    3,068       3,320       3,497       12,683       12,374  

Total noninterest expense

    13,913       15,967       13,912       60,865       63,062  

Income before income tax expense

    10,779       9,003       8,578       44,348       9,909  

Income tax expense

    1,881       1,699       1,642       8,639       1,909  

Net income

  $ 8,898     $ 7,304     $ 6,936     $ 35,709     $ 8,000  
                                         

EARNINGS PER SHARE

                                       

Basic earnings per common share

  $ 0.90     $ 0.74     $ 0.67     $ 3.54     $ 0.77  

Diluted earnings per common share

    0.88       0.73       0.67       3.50       0.76  

Cash dividends declared per common share

    0.095       0.095       0.08       0.365       0.31  

 

10

 

INVESTAR HOLDING CORPORATION

CONSOLIDATED AVERAGE BALANCE SHEET, INTEREST EARNED AND YIELD ANALYSIS

(Amounts in thousands)

(Unaudited)

 

   

For the three months ended

 
   

December 31, 2022

   

September 30, 2022

   

December 31, 2021

 
           

Interest

                   

Interest

                   

Interest

         
   

Average

   

Income/

           

Average

   

Income/

           

Average

   

Income/

         
   

Balance

   

Expense

   

Yield/ Rate

   

Balance

   

Expense

   

Yield/ Rate

   

Balance

   

Expense

   

Yield/ Rate

 

Assets

                                                                       

Interest-earning assets:

                                                                       

Loans

  $ 2,033,117     $ 25,958       5.07 %   $ 1,954,493     $ 23,924       4.86 %   $ 1,885,979     $ 22,248       4.68 %

Securities:

                                                                       

Taxable

    466,881       2,978       2.53       466,012       2,769       2.36       287,692       1,156       1.59  

Tax-exempt

    16,958       108       2.52       16,528       105       2.50       20,267       135       2.63  

Interest-bearing balances with banks

    35,492       328       3.67       31,324       204       2.58       191,958       214       0.44  

Total interest-earning assets

    2,552,448       29,372       4.57       2,468,357       27,002       4.34       2,385,896       23,753       3.95  

Cash and due from banks

    33,363                       33,291                       47,384                  

Intangible assets

    43,262                       43,472                       44,156                  

Other assets

    71,972                       98,936                       139,064                  

Allowance for loan losses

    (23,441 )                     (22,445 )                     (21,289 )                

Total assets

  $ 2,677,604                     $ 2,621,611                     $ 2,595,211                  
                                                                         

Liabilities and stockholders’ equity

                                                                       

Interest-bearing liabilities:

                                                                       

Deposits:

                                                                       

Interest-bearing demand deposits

  $ 822,871     $ 1,084       0.52 %   $ 887,040     $ 594       0.27 %   $ 939,789     $ 413       0.17 %

Brokered demand deposits

                                        16,405       2       0.04  

Savings deposits

    160,046       18       0.04       173,582       20       0.05       178,751       43       0.09  

Time deposits

    499,351       1,950       1.55       396,204       701       0.70       462,611       759       0.65  

Total interest-bearing deposits

    1,482,268       3,052       0.82       1,456,826       1,315       0.36       1,597,556       1,217       0.30  

Short-term borrowings

    284,384       2,785       3.89       191,210       1,156       2.40       6,772       4       0.22  

Long-term debt

    106,218       1,016       3.79       124,924       1,064       3.38       129,842       1,065       3.26  

Total interest-bearing liabilities

    1,872,870       6,853       1.45       1,772,960       3,535       0.79       1,734,170       2,286       0.52  

Noninterest-bearing deposits

    590,020                       612,777                       603,162                  

Other liabilities

    3,129                       9,250                       16,414                  

Stockholders’ equity

    211,585                       226,624                       241,465                  

Total liability and stockholders’ equity

  $ 2,677,604                     $ 2,621,611                     $ 2,595,211                  

Net interest income/net interest margin

          $ 22,519       3.50 %           $ 23,467       3.77 %           $ 21,467       3.57 %

 

11

INVESTAR HOLDING CORPORATION

CONSOLIDATED AVERAGE BALANCE SHEET, INTEREST EARNED AND YIELD ANALYSIS

(Amounts in thousands)

(Unaudited)

 

   

For the twelve months ended

 
   

December 31, 2022

   

December 31, 2021

 
           

Interest

                   

Interest

         
   

Average

   

Income/

           

Average

   

Income/

         
   

Balance

   

Expense

   

Yield/ Rate

   

Balance

   

Expense

   

Yield/ Rate

 

Assets

                                               

Interest-earning assets:

                                               

Loans

  $ 1,937,255     $ 93,373       4.82 %   $ 1,902,070     $ 90,230       4.74 %

Securities:

                                               

Taxable

    442,767       9,796       2.21       275,963       3,948       1.43  

Tax-exempt

    18,746       482       2.57       20,259       552       2.73  

Interest-bearing balances with banks

    45,542       918       2.02       176,349       812       0.46  

Total interest-earning assets

    2,444,310       104,569       4.28       2,374,641       95,542       4.02  

Cash and due from banks

    34,327                       39,262                  

Intangible assets

    43,588                       41,299                  

Other assets

    103,711                       138,096                  

Allowance for loan losses

    (22,093 )                     (20,704 )                

Total assets

  $ 2,603,843                     $ 2,572,594                  
                                                 

Liabilities and stockholders’ equity

                                               

Interest-bearing liabilities:

                                               

Deposits:

                                               

Interest-bearing demand deposits

  $ 900,405     $ 2,411       0.27 %   $ 858,660     $ 2,398       0.28 %

Brokered demand deposits

    1,773       7       0.42       77,432       715       0.92  

Savings deposits

    173,460       79       0.05       168,194       247       0.15  

Time deposits

    427,498       3,753       0.88       508,954       4,127       0.81  

Total interest-bearing deposits

    1,503,136       6,250       0.42       1,613,240       7,487       0.46  

Short-term borrowings

    134,192       4,093       3.05       9,323       19       0.20  

Long-term debt

    127,288       4,441       3.49       129,318       4,222       3.26  

Total interest-bearing liabilities

    1,764,616       14,784       0.84       1,751,881       11,728       0.67  

Noninterest-bearing deposits

    600,286                       553,083                  

Other liabilities

    10,425                       18,852                  

Stockholders’ equity

    228,516                       248,778                  

Total liability and stockholders’ equity

  $ 2,603,843                     $ 2,572,594                  

Net interest income/net interest margin

          $ 89,785       3.67 %           $ 83,814       3.53 %

 


 

INVESTAR HOLDING CORPORATION

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

INTEREST EARNED AND YIELD ANALYSIS ADJUSTED FOR ACCELERATED PPP INCOME, INTEREST RECOVERIES, AND ACCRETION
(Amounts in thousands)
(Unaudited)

 

   

For the three months ended

 
   

December 31, 2022

   

September 30, 2022

   

December 31, 2021

 
           

Interest

                   

Interest

                   

Interest

         
   

Average

   

Income/

           

Average

   

Income/

           

Average

   

Income/

         
   

Balance

   

Expense

   

Yield/ Rate

   

Balance

   

Expense

   

Yield/ Rate

   

Balance

   

Expense

   

Yield/ Rate

 

Interest-earning assets:

                                                                       

Loans

  $ 2,033,117     $ 25,958       5.07 %   $ 1,954,493     $ 23,924       4.86 %   $ 1,885,979     $ 22,248       4.68 %

Adjustments:

                                                                       

Accelerated fee income for forgiven or paid off PPP loans

                                  58                       812          

Interest recoveries

                                  121                       119          

Accretion

            66                       142                       211          

Adjusted loans

    2,033,117       25,892       5.05       1,954,493       23,603       4.79       1,885,979       21,106       4.44  

Securities:

                                                                       

Taxable

    466,881       2,978       2.53       466,012       2,769       2.36       287,692       1,156       1.59  

Tax-exempt

    16,958       108       2.52       16,528       105       2.50       20,267       135       2.63  

Interest-bearing balances with banks

    35,492       328       3.67       31,324       204       2.58       191,958       214       0.44  

Adjusted interest-earning assets

    2,552,448       29,306       4.56       2,468,357       26,681       4.29       2,385,896       22,611       3.76  
                                                                         

Total interest-bearing liabilities

    1,872,870       6,853       1.45       1,772,960       3,535       0.79       1,734,170       2,286       0.52  
                                                                         

Adjusted net interest income/adjusted net interest margin

          $ 22,453       3.49 %           $ 23,146       3.72 %           $ 20,325       3.38 %

 

12

 

INVESTAR HOLDING CORPORATION

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

INTEREST EARNED AND YIELD ANALYSIS ADJUSTED FOR PPP LOANS
(Amounts in thousands)
(Unaudited)

 

   

For the three months ended

 
   

December 31, 2022

   

September 30, 2022

   

December 31, 2021

 
           

Interest

                   

Interest

                   

Interest

         
   

Average

   

Income/

           

Average

   

Income/

           

Average

   

Income/

         
   

Balance

   

Expense