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Amerant Reports Second Quarter 2024 Results

Board of Directors Declares Quarterly Cash Dividend of $0.09 per Common Share

Amerant Bancorp Inc. (NYSE: AMTB) (the “Company” or “Amerant”) today reported net income attributable to the Company of $5.0 million in the second quarter of 2024, or $0.15 per diluted share, compared to $10.6 million, or $0.31 per diluted share, in the first quarter of 2024.

“The Company had strong loan growth in the second quarter, as well as significantly higher pre-provision net revenue, excluding the impact of previously disclosed deal charges from the sale of our Houston franchise” stated Jerry Plush, Chairman and CEO. “However, the provision for credit losses was higher than the first quarter, primarily related to a legacy commercial credit that, while paying as agreed, was downgraded based on the receipt of updated financial information. We are actively working toward reaching a positive resolution on this credit, as we remain focused on executing on our strategic plan.”

  • Total assets were $9.7 billion, a decrease of $70.0 million, or 0.7%, compared to $9.8 billion in 1Q24.
  • Cash and cash equivalents were $310.3 million, down $349.4 million, or 53.0%, compared to $659.7 million in 1Q24.
  • Total gross loans were $7.32 billion, an increase of $316.5 million, or 4.5%, compared to $7.01 billion in 1Q24, driven by organic production during the quarter.
  • Average yield on loans increased to 7.08%, compared to 7.05% in 1Q24.
  • Total deposits were $7.82 billion, down $62.2 million, or 0.8%, compared to $7.88 billion in 1Q24, as continued organic growth was offset by a reduction in higher-cost municipal and commercial deposits.
  • Core deposits were $5.51 billion, down $127.8 million, or 2.3%, compared to $5.63 billion in 1Q24, driven by the previously referenced reduction in higher-cost municipal and commercial deposits.
  • Average cost of total deposits slightly decreased to 2.98%, compared to 3.00% in 1Q24.
  • Loan to deposit ratio was 93.69%, compared to 88.93% in 1Q24.
  • Total advances from Federal Home Loan Bank (“FHLB”) were $765.0 million, up $50.0 million, or 7.0%, compared to $715.0 million in 1Q24. The Bank had $2.1 billion in availability remaining from the FHLB as of June 30, 2024.
  • Total non-performing assets were $121.1 million, up $70.6 million, or 139.9%, compared to $50.5 million as of 1Q24. The increase was primarily driven by three credits previously classified as special mention and two newly downgraded loans to substandard based on receipt of updated financial information from borrowers in the second quarter.
  • The allowance for credit losses ("ACL") was $94.4 million, a decrease of $1.7 million, or 1.7%, compared to $96.1 million as of 1Q24.
  • Assets Under Management and custody (“AUM”) totaled $2.45 billion, up $94.2 million, or 4.0%, from $2.36 billion in 1Q24.
  • Pre-provision net revenue (“PPNR”)(1) was $25.5 million, compared to $25.9 million in 1Q24. PPNR, excluding non-routine items in connection with the sale of the Company’s Houston franchise which were disclosed on a Form 8-K on July 1, 2024 (the “Houston Transaction”), was $31.0 million, compared to PPNR of $26.1 million in 1Q24, excluding non-routine items of non-interest income and expense(2).
  • Net Interest Margin (“NIM”), was 3.56%, up compared to 3.51% in 1Q24
  • Net Interest Income (“NII”) was $79.4 million, up $1.4 million, or 1.8%, from $78.0 million in 1Q24.
  • Provision for credit losses was $19.2 million, up $6.8 million, or 54.4%, compared to $12.4 million in 1Q24.
  • Non-interest income was $19.4 million, up $4.9 million, or 34.0%, from $14.5 million in 1Q24.
  • Non-interest expense was $73.3 million, up $6.7 million, or 10.1%, from $66.6 million in 1Q24. Non-interest expense, excluding non-routine items in connection with the Houston Transaction(2) were $67.7 million.
  • The efficiency ratio was 74.2%, compared to 72.0% in 1Q24. The efficiency ratio excluding non-routine items in connection with the Houston Transaction was 68.6%(2).
  • Return on average assets (“ROA”) was 0.21%, compared to 0.44% in 1Q24. ROA excluding non-routine items in connection with the Houston Transaction was 0.38%(2).
  • Return on average equity (“ROE”) was 2.68%, compared to 5.69% in 1Q24. ROE excluding non-routine items in connection with the Houston Transaction was 5.03%(2).
  • The Company’s Board of Directors declared a cash dividend of $0.09 per share of common stock on July 24, 2024. The dividend is payable on August 30, 2024, to shareholders of record on August 15, 2024.

Additional details on second quarter 2024 results can be found in the Exhibits and Glossary of Terms and Definitions to this earnings release, and the earnings presentation available under the Investor Relations section of the Company’s website at https://investor.amerantbank.com. See Glossary of Terms and Definitions for definitions of financial terms.

1 Non-GAAP measure, see “Non-GAAP Financial Measures” for more information and Exhibit 2 for a reconciliation to GAAP measures.

2 Represents core PPNR, core noninterest expense, core efficiency ratio, core ROA or Core ROE, as applicable, which are Non-GAAP measures. See “Non-GAAP Financial Measures” for more information and Exhibit 2 for a reconciliation to GAAP measures.

Second Quarter 2024 Earnings Conference Call

The Company will hold an earnings conference call on Thursday, July 25, 2024 at 9:00 a.m. (Eastern Time) to discuss its second quarter 2024 results. The conference call and presentation materials can be accessed via webcast by logging on from the Investor Relations section of the Company’s website at https://investor.amerantbank.com. The online replay will remain available for approximately one month following the call through the above link.

About Amerant Bancorp Inc. (NYSE: AMTB)

Amerant Bancorp Inc. is a bank holding company headquartered in Coral Gables, Florida since 1979. The Company operates through its main subsidiary, Amerant Bank, N.A. (the “Bank”), as well as its other subsidiaries: Amerant Investments, Inc., Elant Bank and Trust Ltd., and Amerant Mortgage, LLC. The Company provides individuals and businesses in the U.S. with deposit, credit and wealth management services. The Bank, which has operated for over 40 years, is the largest community bank headquartered in Florida. The Bank operates 25 banking centers – 18 in South Florida, 1 in Tampa, FL and 6 in the Houston, Texas area. For more information, visit investor.amerantbank.com.

Cautionary Notice Regarding Forward-Looking Statements

This press release contains “forward-looking statements” including statements with respect to the Company’s objectives, expectations and intentions and other statements that are not historical facts. Examples of forward-looking statements include but are not limited to: our future operating or financial performance, including revenues, expenses, expense savings, income or loss and earnings or loss per share, and other financial items; statements regarding expectations, plans or objectives for future operations, products or services, and our expectations on loan recoveries or reaching positive resolutions on problem loans. All statements other than statements of historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our use of words such as “may,” “will,” “anticipate,” “assume,” “should,” “indicate,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “plan,” “point to,” “project,” “could,” “intend,” “target,” “goals,” “outlooks,” “modeled,” “dedicated,” “create,” and other similar words and expressions of the future.

Forward-looking statements, including those relating to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the Company’s actual results, performance, achievements, or financial condition to be materially different from future results, performance, achievements, or financial condition expressed or implied by such forward-looking statements. You should not rely on any forward-looking statements as predictions of future events. You should not expect us to update any forward-looking statements, except as required by law. All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, together with those risks and uncertainties described in “Risk factors” in our annual report on Form 10-K for the fiscal year ended December 31, 2023 filed on March 7, 2024, in our quarterly report on Form 10-Q for the fiscal quarter ended March 31, 2024 filed on May 3, 2024 and in our other filings with the U.S. Securities and Exchange Commission (the “SEC”), which are available at the SEC’s website www.sec.gov.

Interim Financial Information

Unaudited financial information as of and for interim periods, including the three and six month periods ended June 30, 2024 and 2023, and the three months ended March 31, 2024 and December 31, 2023, may not reflect our results of operations for our fiscal year ending, or financial condition, as of December 31, 2024, or any other period of time or date.

Non-GAAP Financial Measures

The Company supplements its financial results that are determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”) with non-GAAP financial measures, such as “pre-provision net revenue (PPNR)”, “core pre-provision net revenue (Core PPNR)”, “core noninterest income”, “core noninterest expense”, “core net income”, “core earnings per share (basic and diluted)”, “core return on assets (Core ROA)”, “core return on equity (Core ROE)”, “core efficiency ratio”, “tangible stockholders’ equity (book value) per common share”, “tangible common equity ratio, adjusted for unrealized losses on debt securities held to maturity”, and “tangible stockholders' equity (book value) per common share, adjusted for unrealized losses on debt securities held to maturity”. This supplemental information is not required by, or is not presented in accordance with GAAP. The Company refers to these financial measures and ratios as “non-GAAP financial measures” and they should not be considered in isolation or as a substitute for the GAAP measures presented herein.

We use certain non-GAAP financial measures, including those mentioned above, both to explain our results to shareholders and the investment community and in the internal evaluation and management of our businesses. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our past performance and prospects for future performance, especially in light of the additional costs we have incurred in connection with the Company’s restructuring activities that began in 2018 and continued in 2024, including the effect of non-core banking activities such as the sale of loans and securities and other repossessed assets, the Houston Transaction, the valuation of securities, derivatives, loans held for sale and other real estate owned and repossessed assets, the early repayment of FHLB advances, impairment of investments, Bank owned life insurance restructure and other non-routine actions intended to improve customer service and operating performance. While we believe that these non-GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies.

Exhibit 2 reconciles these non-GAAP financial measures to GAAP reported results.

Exhibit 1- Selected Financial Information

The following table sets forth selected financial information derived from our interim unaudited and annual audited consolidated financial statements.

(in thousands)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

Consolidated Balance Sheets

 

 

 

 

(audited)

 

 

 

 

Total assets

$

9,747,738

 

$

9,817,772

 

$

9,716,327

 

$

9,345,700

 

$

9,519,526

Total investments

 

1,547,864

 

 

 

1,578,568

 

 

 

1,496,975

 

 

 

1,314,367

 

 

 

1,315,303

 

Total gross loans (1)(2)

 

7,322,911

 

 

 

7,006,383

 

 

 

7,264,912

 

 

 

7,142,596

 

 

 

7,216,958

 

Allowance for credit losses

 

94,400

 

 

 

96,050

 

 

 

95,504

 

 

 

98,773

 

 

 

105,956

 

Total deposits

 

7,816,011

 

 

 

7,878,243

 

 

 

7,894,863

 

 

 

7,546,912

 

 

 

7,579,571

 

Core deposits (1)

 

5,505,349

 

 

 

5,633,165

 

 

 

5,597,766

 

 

 

5,244,034

 

 

 

5,498,017

 

Advances from the Federal Home Loan Bank

 

765,000

 

 

 

715,000

 

 

 

645,000

 

 

 

595,000

 

 

 

770,000

 

Senior notes

 

59,685

 

 

 

59,605

 

 

 

59,526

 

 

 

59,447

 

 

 

59,368

 

Subordinated notes

 

29,539

 

 

 

29,497

 

 

 

29,454

 

 

 

29,412

 

 

 

29,369

 

Junior subordinated debentures

 

64,178

 

 

 

64,178

 

 

 

64,178

 

 

 

64,178

 

 

 

64,178

 

Stockholders' equity (3)(4)

 

734,342

 

 

 

738,085

 

 

 

736,068

 

 

 

719,787

 

 

 

720,956

 

Assets under management and custody (1)

 

2,451,854

 

 

 

2,357,621

 

 

 

2,289,135

 

 

 

2,092,200

 

 

 

2,147,465

 

 

Three Months Ended

(in thousands, except percentages, share data and per share amounts)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

Consolidated Results of Operations

 

 

 

 

 

 

 

 

 

Net interest income

$

79,355

 

 

$

77,968

 

 

$

81,677

 

 

$

78,577

 

 

$

83,877

 

Provision for credit losses (5)

 

19,150

 

 

 

12,400

 

 

 

12,500

 

 

 

8,000

 

 

 

29,077

 

Noninterest income

 

19,420

 

 

 

14,488

 

 

 

19,613

 

 

 

21,921

 

 

 

26,619

 

Noninterest expense

 

73,302

 

 

 

66,594

 

 

 

109,702

 

 

 

64,420

 

 

 

72,500

 

Net income (loss) attributable to Amerant Bancorp Inc. (6)

 

4,963

 

 

 

10,568

 

 

 

(17,123

)

 

 

22,119

 

 

 

7,308

 

Effective income tax rate

 

21.51

%

 

 

21.50

%

 

 

14.21

%

 

 

22.57

%

 

 

21.00

%

 

 

 

 

 

 

 

 

 

 

Common Share Data

 

 

 

 

 

 

 

 

 

Stockholders' book value per common share

$

21.88

 

 

$

21.90

 

 

$

21.90

 

 

$

21.43

 

 

$

21.37

 

Tangible stockholders' equity (book value) per common share (7)

$

21.15

 

 

$

21.16

 

 

$

21.16

 

 

$

20.63

 

 

$

20.66

 

Tangible stockholders' equity (book value) per common share, adjusted for unrealized losses on debt securities held to maturity (7)

$

20.54

 

 

$

20.60

 

 

$

20.68

 

 

$

19.86

 

 

$

20.11

 

Basic earnings (loss) per common share

$

0.15

 

 

$

0.32

 

 

$

(0.51

)

 

$

0.66

 

 

$

0.22

 

Diluted earnings (loss) per common share (8)

$

0.15

 

 

$

0.31

 

 

$

(0.51

)

 

$

0.66

 

 

$

0.22

 

Basic weighted average shares outstanding

 

33,581,604

 

 

 

33,538,069

 

 

 

33,432,871

 

 

 

33,489,560

 

 

 

33,564,770

 

Diluted weighted average shares outstanding (8)

 

33,780,666

 

 

 

33,821,562

 

 

 

33,432,871

 

 

 

33,696,620

 

 

 

33,717,702

 

Cash dividend declared per common share (3)

$

0.09

 

 

$

0.09

 

 

$

0.09

 

 

$

0.09

 

 

$

0.09

 

 

Three Months Ended

 

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

Other Financial and Operating Data (9)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profitability Indicators (%)

 

 

 

 

 

 

 

 

 

Net interest income / Average total interest earning assets (NIM) (1)

3.56

%

 

3.51

%

 

3.72

%

 

3.57

%

 

3.83

%

Net income (loss)/ Average total assets (ROA)(1)

0.21

%

 

0.44

%

 

(0.71

)%

 

0.92

%

 

0.31

%

Net income (loss) / Average stockholders' equity (ROE) (1)

2.68

%

 

5.69

%

 

(9.22

)%

 

11.93

%

 

3.92

%

Noninterest income / Total revenue (1)

19.66

%

 

15.67

%

 

19.36

%

 

21.81

%

 

24.09

%

 

 

 

 

 

 

 

 

 

 

Capital Indicators (%)

 

 

 

 

 

 

 

 

 

Total capital ratio (1)

12.00

%

 

12.49

%

 

12.12

%

 

12.70

%

 

12.39

%

Tier 1 capital ratio (1)

10.44

%

 

10.87

%

 

10.54

%

 

11.08

%

 

10.77

%

Tier 1 leverage ratio (1)

8.74

%

 

8.73

%

 

8.84

%

 

9.05

%

 

8.91

%

Common equity tier 1 capital ratio (CET1) (1)

9.70

%

 

10.10

%

 

9.79

%

 

10.30

%

 

10.00

%

Tangible common equity ratio (1)

7.30

%

 

7.28

%

 

7.34

%

 

7.44

%

 

7.34

%

Tangible common equity ratio, adjusted for unrealized losses on debt securities held to maturity (1)

7.11

%

 

7.10

%

 

7.18

%

 

7.18

%

 

7.16

%

 

 

 

 

 

 

 

 

 

 

Liquidity Ratios (%)

 

 

 

 

 

 

 

 

 

Loans to Deposits (1)

93.69

%

 

88.93

%

 

92.02

%

 

94.64

%

 

95.22

%

 

 

 

 

 

 

 

 

 

 

Asset Quality Indicators (%)

 

 

 

 

 

 

 

 

 

Non-performing assets / Total assets (1)

1.24

%

 

0.51

%

 

0.56

%

 

0.57

%

 

0.71

%

Non-performing loans / Total gross loans (1)

1.38

%

 

0.43

%

 

0.47

%

 

0.46

%

 

0.65

%

Allowance for credit losses / Total non-performing loans

93.51

%

 

317.01

%

 

277.63

%

 

297.55

%

 

224.51

%

Allowance for credit losses / Total loans held for investment

1.41

%

 

1.38

%

 

1.39

%

 

1.40

%

 

1.48

%

Net charge-offs / Average total loans held for investment (1)(10)

1.13

%

 

0.69

%

 

0.85

%

 

0.82

%

 

0.42

%

 

 

 

 

 

 

 

 

 

 

Efficiency Indicators (% except FTE)

 

 

 

 

 

 

 

 

 

Noninterest expense / Average total assets

3.03

%

 

2.75

%

 

4.57

%

 

2.69

%

 

3.06

%

Salaries and employee benefits / Average total assets

1.40

%

 

1.36

%

 

1.38

%

 

1.31

%

 

1.45

%

Other operating expenses/ Average total assets (1)

1.63

%

 

1.39

%

 

3.20

%

 

1.38

%

 

1.62

%

Efficiency ratio (1)

74.21

%

 

72.03

%

 

108.30

%

 

64.10

%

 

65.61

%

Full-Time-Equivalent Employees (FTEs) (11)

720

 

 

696

 

 

682

 

 

700

 

 

710

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

(in thousands, except percentages and per share amounts)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

Core Selected Consolidated Results of Operations and Other Data (7)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-provision net revenue (loss) (PPNR)

$

25,473

 

 

$

25,862

 

 

$

(7,595

)

 

$

36,456

 

 

$

38,258

 

Core pre-provision net revenue (Core PPNR)

$

31,007

 

 

$

26,068

 

 

$

29,811

 

 

$

35,880

 

 

$

39,196

 

Core net income

$

9,307

 

 

$

10,730

 

 

$

15,272

 

 

$

21,664

 

 

$

8,048

 

Core basic earnings per common share

 

0.28

 

 

 

0.32

 

 

 

0.46

 

 

 

0.65

 

 

 

0.24

 

Core earnings per diluted common share (8)

 

0.28

 

 

 

0.32

 

 

 

0.46

 

 

 

0.64

 

 

 

0.24

 

Core net income / Average total assets (Core ROA) (1)

 

0.38

%

 

 

0.44

%

 

 

0.64

%

 

 

0.91

%

 

 

0.34

%

Core net income / Average stockholders' equity (Core ROE) (1)

 

5.03

%

 

 

5.78

%

 

 

8.23

%

 

 

11.69

%

 

 

4.32

%

Core efficiency ratio (12)

 

68.60

%

 

 

71.87

%

 

 

69.67

%

 

 

62.08

%

 

 

60.29

%

__________________

(1)

See Glossary of Terms and Definitions for definitions of financial terms.

(2)

As of June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023 and June 30, 2023, mortgage loans held for sale carried at fair value totaled $60.1 million, $48.9 million, $26.2 million, $26.0 million and $49.9 million, respectively. In addition, June 30, 2024, December 31, 2023 and September 30, 2023, includes $551.8 million $365.2 million and $43.3 million, respectively, in loans held for sale carried at the lower of estimated cost or fair value.

(3)

In the fourth quarter of 2022, the Company announced that the Board of Directors authorized a new repurchase program pursuant to which the Company may purchase, from time to time, up to an aggregate amount of $25 million of its shares of Class A common stock (the “2023 Class A Common Stock Repurchase Program”). In the second quarter of 2024 the Company repurchased an aggregate of 200,652 shares of Class A common stock at a weighted average price of $22.17 per share under the 2023 Class A Common Stock Repurchase Program. The aggregate purchase price for this transactions was approximately $4.4 million which includes transaction costs. For all other periods, see March 31, 2024 Form 10-Q and 2023 Form 10-K.

(4)

For the second and first quarters of 2024 as well as each of the fourth, third and second quarters of 2023, the Company’s Board of Directors declared cash dividends of $0.09 per share of the Company’s common stock and paid an aggregate amount of $3.0 million per quarter in connection with these dividends. The dividend declared in the second quarter of 2024 was paid on May 30, 2024 to shareholders of record at the close of business on May 15, 2024. See March 31, 2024 Form 10-Q and 2023 Form 10-K for more information on dividend payments during the previous quarters.

(5)

In the second and first quarter of 2024 and in the fourth and third quarter of 2023, includes, $17.7 million, $12.4 million, $12.0 million and $7.4 million of provision for credit losses on loans. Provision for unfunded commitments (contingencies) in the second quarter of 2024 and in the fourth and third quarter of 2023, were $1.5 million, $0.5 million and $0.6 million, respectively, while there was none in the first quarter of 2024. For all other periods shown, includes provision for credit losses on loans. There was no provision for credit losses on unfunded commitments in the second quarter of 2023.

(6)

In the three months ended December 31, 2023, September 30, 2023 and June 30, 2023, net income excludes losses of $0.8 million, $0.4 million and $0.3 million, respectively, attributable to a minority interest in Amerant Mortgage LLC. In the fourth quarter of 2023, the Company increased its ownership interest in Amerant Mortgage to 100% from 80% at September 30, 2023. This transaction had no material impact to the Company’s results of operations in the three months ended December 31, 2023. In connection with the change in ownership interest, which brought the minority interest share to zero, the Company derecognized the equity attributable to noncontrolling interest of $3.8 million at December 31, 2023, with a corresponding reduction to additional paid-in capital.

(7)

This presentation contains adjusted financial information determined by methods other than GAAP. This adjusted financial information is reconciled to GAAP in Exhibit 2 - Non-GAAP Financial Measures Reconciliation.

(8)

See 2023 Form 10-K for more information on potential dilutive instruments and its impact on diluted earnings per share computation.

(9)

Operating data for the periods presented have been annualized.

(10)

See 2023 Form 10-K for more details on charge-offs for all previous periods.

(11)

As of June 30, 2024, March 31, 2034, December 31, 2023, September 30, 2023 and June 30, 2023, includes 83, 65, 67, 98, and 93 FTEs for Amerant Mortgage LLC, respectively.

(12)

Core efficiency ratio is the efficiency ratio less the effect of restructuring costs and other non-routine items, described in Exhibit 2 - Non-GAAP Financial Measures Reconciliation.

 

Exhibit 2- Non-GAAP Financial Measures Reconciliation

The following table sets forth selected financial information derived from the Company’s interim unaudited and annual audited consolidated financial statements, adjusted for certain costs incurred by the Company in the periods presented related to tax deductible restructuring costs, provision for (reversal of) credit losses, provision for income tax expense (benefit), the effect of non-core banking activities such as the sale of loans and securities and other repossessed assets, the Houston Transaction, the valuation of securities, derivatives, loans held for sale and other real estate owned and repossessed assets, the early repayment of FHLB advances, impairment of investments, Bank owned life insurance restructure and other non-routine actions intended to improve customer service and operating performance. The Company believes these adjusted numbers are useful to understand the Company’s performance absent these transactions and events.

 

Three Months Ended,

(in thousands)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to Amerant Bancorp Inc.

$

4,963

 

 

$

10,568

 

 

$

(17,123

)

 

$

22,119

 

 

$

7,308

 

Plus: provision for credit losses (1)

 

19,150

 

 

 

12,400

 

 

 

12,500

 

 

 

8,000

 

 

 

29,077

 

Plus: provision for income tax (benefit) expense

 

1,360

 

 

 

2,894

 

 

 

(2,972

)

 

 

6,337

 

 

 

1,873

 

Pre-provision net revenue (loss) (PPNR)

 

25,473

 

 

 

25,862

 

 

 

(7,595

)

 

 

36,456

 

 

 

38,258

 

Plus: non-routine noninterest expense items

 

5,562

 

 

 

 

 

 

43,094

 

 

 

6,303

 

 

 

13,383

 

Less: non-routine noninterest income items

 

(28

)

 

 

206

 

 

 

(5,688

)

 

 

(6,879

)

 

 

(12,445

)

Core pre-provision net revenue (Core PPNR)

$

31,007

 

 

$

26,068

 

 

$

29,811

 

 

$

35,880

 

 

$

39,196

 

 

 

 

 

 

 

 

 

 

 

Total noninterest income

$

19,420

 

 

$

14,488

 

 

$

19,613

 

 

$

21,921

 

 

$

26,619

 

Less: Non-routine noninterest income items:

 

 

 

 

 

 

 

 

 

Derivatives (losses) gains, net

 

(44

)

 

 

(152

)

 

 

(151

)

 

 

(77

)

 

 

242

 

Securities (losses) gains, net

 

(117

)

 

 

(54

)

 

 

33

 

 

 

(54

)

 

 

(1,237

)

Bank owned life insurance charge (2)

 

 

 

 

 

 

 

(655

)

 

 

 

 

 

 

Gains on early extinguishment of FHLB advances, net

 

189

 

 

 

 

 

 

6,461

 

 

 

7,010

 

 

 

13,440

 

Total non-routine noninterest income items

$

28

 

 

$

(206

)

 

$

5,688

 

 

$

6,879

 

 

$

12,445

 

Core noninterest income

$

19,392

 

 

$

14,694

 

 

$

13,925

 

 

$

15,042

 

 

$

14,174

 

 

 

 

 

 

 

 

 

 

 

Total noninterest expense

$

73,302

 

 

$

66,594

 

 

$

109,702

 

 

$

64,420

 

 

$

72,500

 

Less: non-routine noninterest expense items

 

 

 

 

 

 

 

 

 

Restructuring costs (3):

 

 

 

 

 

 

 

 

 

Staff reduction costs (4)

 

 

 

 

 

 

 

1,120

 

 

 

489

 

 

 

2,184

 

Contract termination costs (5)

 

 

 

 

 

 

 

 

 

 

 

 

 

1,550

 

Consulting and other professional fees and software expenses(6)

 

 

 

 

 

 

 

1,629

 

 

 

 

 

 

2,060

 

Disposition of fixed assets (7)

 

 

 

 

 

 

 

 

 

 

 

 

 

1,419

 

Branch closure expenses and related charges (8)

 

 

 

 

 

 

 

 

 

 

252

 

 

 

1,558

 

Total restructuring costs

$

 

 

$

 

 

$

2,749

 

 

$

741

 

 

$

8,771

 

Other non-routine noninterest expense items:

 

 

 

 

 

 

 

 

 

Losses on loans held for sale carried at the lower cost or fair value (9)(11)

 

1,258

 

 

 

 

 

 

37,495

 

 

 

5,562

 

 

 

 

Loss on sale of repossessed assets and other real estate owned valuation expense (10)

 

 

 

 

 

 

 

 

 

 

 

 

 

2,649

 

Goodwill and intangible assets impairment (11)

 

300

 

 

 

 

 

 

1,713

 

 

 

 

 

 

 

Fixed assets impairment (11)(12)

 

3,443

 

 

 

 

 

 

 

 

 

 

 

 

 

Legal and broker fees (11)

 

561

 

 

 

 

 

 

 

 

 

 

 

 

 

Bank owned life insurance enhancement costs (2)

 

 

 

 

 

 

 

1,137

 

 

 

 

 

 

 

Impairment charge on investment carried at cost

 

 

 

 

 

 

 

 

 

 

 

 

 

1,963

 

Total non-routine noninterest expense items

$

5,562

 

 

$

 

 

$

43,094

 

 

$

6,303

 

 

$

13,383

 

Core noninterest expense

$

67,740

 

 

$

66,594

 

 

$

66,608

 

 

$

58,117

 

 

$

59,117

 

 

(in thousands, except percentages and per share amounts)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

 

 

 

 

Net income (loss) attributable to Amerant Bancorp Inc.

$

4,963

 

 

$

10,568

 

 

$

(17,123

)

 

$

22,119

 

 

$

7,308

 

Plus after-tax non-routine items in noninterest expense:

 

 

 

 

 

 

 

 

 

Non-routine items in noninterest expense before income tax effect

 

5,562

 

 

 

 

 

 

43,094

 

 

 

6,303

 

 

 

13,383

 

Income tax effect (13)

 

(1,196

)

 

 

 

 

 

(8,887

)

 

 

(1,486

)

 

 

(2,811

)

Total after-tax non-routine items in noninterest expense

 

4,366

 

 

 

 

 

 

34,207

 

 

 

4,817

 

 

 

10,572

 

Less after-tax non-routine items in noninterest income:

 

 

 

 

 

 

 

 

 

Non-routine items in noninterest income before income tax effect

 

(28

)

 

 

206

 

 

 

(5,688

)

 

 

(6,879

)

 

 

(12,445

)

Income tax effect (13)

 

6

 

 

 

(44

)

 

 

1,032

 

 

 

1,607

 

 

 

2,613

 

Total after-tax non-routine items in noninterest income

 

(22

)

 

 

162

 

 

 

(4,656

)

 

 

(5,272

)

 

 

(9,832

)

BOLI enhancement tax impact (2)

 

 

 

 

 

 

 

2,844

 

 

 

 

 

 

 

Core net income

$

9,307

 

 

$

10,730

 

 

$

15,272

 

 

$

21,664

 

 

$

8,048

 

 

 

 

 

 

 

 

 

 

 

Basic earnings (loss) per share

$

0.15

 

 

$

0.32

 

 

$

(0.51

)

 

$

0.66

 

 

$

0.22

 

Plus: after tax impact of non-routine items in noninterest expense and BOLI tax impact (14)

 

0.13

 

 

 

 

 

 

1.11

 

 

 

0.14

 

 

 

0.31

 

(Less): after tax impact of non-routine items in noninterest income

 

 

 

 

 

 

 

(0.14

)

 

 

(0.15

)

 

 

(0.29

)

Total core basic earnings per common share

$

0.28

 

 

$

0.32

 

 

$

0.46

 

 

$

0.65

 

 

$

0.24

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings (loss) per share (15)

$

0.15

 

 

$

0.31

 

 

$

(0.51

)

 

$

0.66

 

 

$

0.22

 

Plus: after tax impact of non-routine items in noninterest expense and BOLI tax impact (14)

 

0.13

 

 

 

 

 

 

1.11

 

 

 

0.14

 

 

 

0.31

 

(Less): after tax impact of non-routine items in noninterest income

 

 

 

 

0.01

 

 

 

(0.14

)

 

 

(0.16

)

 

 

(0.29

)

Total core diluted earnings per common share

$

0.28

 

 

$

0.32

 

 

$

0.46

 

 

$

0.64

 

 

$

0.24

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) / Average total assets (ROA)

 

0.21

%

 

 

0.44

%

 

 

(0.71

)%

 

 

0.92

%

 

 

0.31

%

Plus: after tax impact of non-routine items in noninterest expense and BOLI tax impact (14)

 

0.17

%

 

 

%

 

 

1.55

%

 

 

0.20

%

 

 

0.45

%

Plus (less): after tax impact of non-routine items in noninterest income

 

%

 

 

%

 

 

(0.20

)%

 

 

(0.21

)%

 

 

(0.42

)%

Core net income / Average total assets (Core ROA)

 

0.38

%

 

 

0.44

%

 

 

0.64

%

 

 

0.91

%

 

 

0.34

%

 

 

 

 

 

 

 

 

 

 

Net income (loss) / Average stockholders' equity (ROE)

 

2.68

%

 

 

5.69

%

 

 

(9.22

)%

 

 

11.93

%

 

 

3.92

%

Plus: after tax impact of non-routine items in noninterest expense and BOLI tax impact (14)

 

2.36

%

 

 

%

 

 

19.96

%

 

 

2.60

%

 

 

5.68

%

Plus (less): after tax impact of non-routine items in noninterest income

 

(0.01

)%

 

 

0.09

%

 

 

(2.51

)%

 

 

(2.84

)%

 

 

(5.28

)%

Core net income / Average stockholders' equity (Core ROE)

 

5.03

%

 

 

5.78

%

 

 

8.23

%

 

 

11.69

%

 

 

4.32

%

 

 

 

 

 

 

 

 

 

 

Efficiency ratio

 

74.21

%

 

 

72.03

%

 

 

108.30

%

 

 

64.10

%

 

 

65.61

%

(Less): impact of non-routine items in noninterest expense

 

(5.63

)%

 

 

%

 

 

(42.54

)%

 

 

(6.27

)%

 

 

(12.11

)%

(Less) plus: impact of non-routine items in noninterest income

 

0.02

%

 

 

(0.16

)%

 

 

3.91

%

 

 

4.25

%

 

 

6.79

%

Core efficiency ratio

 

68.60

%

 

 

71.87

%

 

 

69.67

%

 

 

62.08

%

 

 

 

60.29

 

%

 

 

Three Months Ended,

(in thousands, except percentages, share data and per share amounts)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

 

 

 

 

 

 

Stockholders' equity

$

734,342

 

 

$

738,085

 

 

$

736,068

 

 

$

719,787

 

 

$

720,956

 

Less: goodwill and other intangibles (16)

 

(24,581

)

 

 

(24,935

)

 

 

(25,029

)

 

 

(26,818

)

 

 

(24,124

)

Tangible common stockholders' equity

$

709,761

 

 

$

713,150

 

 

$

711,039

 

 

$

692,969

 

 

$

696,832

 

Total assets

 

9,747,738

 

 

 

9,817,772

 

 

 

9,716,327

 

 

 

9,345,700

 

 

 

9,519,526

 

Less: goodwill and other intangibles (16)

 

(24,581

)

 

 

(24,935

)

 

 

(25,029

)

 

 

(26,818

)

 

 

(24,124

)

Tangible assets

$

9,723,157

 

 

$

9,792,837

 

 

$

9,691,298

 

 

$

9,318,882

 

 

$

9,495,402

 

Common shares outstanding

 

33,562,756

 

 

 

33,709,395

 

 

 

33,603,242

 

 

 

33,583,621

 

 

 

33,736,159

 

Tangible common equity ratio

 

7.30

%

 

 

7.28

%

 

 

7.34

%

 

 

7.44

%

 

 

7.34

%

Stockholders' book value per common share

$

21.88

 

 

$

21.90

 

 

$

21.90

 

 

$

21.43

 

 

$

21.37

 

Tangible stockholders' equity book value per common share

$

21.15

 

 

$

21.16

 

 

$

21.16

 

 

$

20.63

 

 

$

20.66

 

 

 

 

 

 

 

 

 

 

 

Tangible common stockholders' equity

$

709,761

 

 

$

713,150

 

 

$

711,039

 

 

$

692,969

 

 

$

696,832

 

Less: Net unrealized accumulated losses on debt securities held to maturity, net of tax (17)

 

(20,304

)

 

 

(18,729

)

 

 

(16,197

)

 

 

(26,138

)

 

 

(18,503

)

Tangible common stockholders' equity, adjusted for net unrealized accumulated losses on debt securities held to maturity

$

689,457

 

 

$

694,421

 

 

$

694,842

 

 

$

666,831

 

 

$

678,329

 

Tangible assets

$

9,723,157

 

 

$

9,792,837

 

 

$

9,691,298

 

 

$

9,318,882

 

 

$

9,495,402

 

Less: Net unrealized accumulated losses on debt securities held to maturity, net of tax (17)

 

(20,304

)

 

 

(18,729

)

 

 

(16,197

)

 

 

(26,138

)

 

 

(18,503

)

Tangible assets, adjusted for net unrealized accumulated losses on debt securities held to maturity

$

9,702,853

 

 

$

9,774,108

 

 

$

9,675,101

 

 

$

9,292,744

 

 

$

9,476,899

 

Common shares outstanding

 

33,562,756

 

 

 

33,709,395

 

 

 

33,603,242

 

 

 

33,583,621

 

 

 

33,736,159

 

 

 

 

 

 

 

 

 

 

 

Tangible common equity ratio, adjusted for net unrealized accumulated losses on debt securities held to maturity

 

7.11

%

 

 

7.10

%

 

 

7.18

%

 

 

7.18

%

 

 

7.16

%

Tangible stockholders' book value per common share, adjusted for net unrealized accumulated losses on debt securities held to maturity

$

20.54

 

 

$

20.60

 

 

$

20.68

 

 

$

19.86

 

 

$

20.11

 

 

 

 

 

 

 

 

 

 

 

____________

(1)

In the second and first quarter of 2024 and in the fourth and third quarter of 2023, includes $17.7 million, $12.4 million, $12.0 million and $7.4 million of provision for credit losses on loans, respectively. Provision for unfunded commitments (contingencies) in the second quarter of 2024, and in the fourth and third quarter of 2023, were $1.5 million, $0.5 million and $0.6 million, respectively, while there was none in the first quarter of 2024. For all other periods shown, includes provision for credit losses on loans. There was no provision for credit losses on unfunded commitments in the second quarter of 2023.

(2)

In the fourth quarter of 2023, the Company completed a restructuring of its bank-owned life insurance (“BOLI”) program. This was executed through a combination of a 1035 exchange and a surrender and reinvestment into higher-yielding general account with a new investment grade insurance carrier. This transaction allowed for higher team member participation through an enhanced split-dollar plan. Estimated improved yields resulting from the enhancement have an earn-back period of approximately 2 years. In the fourth quarter of 2023, we recorded total additional expenses and charges of $4.6 million in connection with this transaction, including: (i) a reduction of $0.7 million to the cash surrender value of BOLI; (ii) transaction costs of $1.1 million, and (iii) income tax expense of $2.8 million.

(3)

Expenses incurred for actions designed to implement the Company’s business strategy. These actions include, but are not limited to reductions in workforce, streamlining operational processes, rolling out the Amerant brand, implementation of new technology system applications, decommissioning of legacy technologies, enhanced sales tools and training, expanded product offerings and improved customer analytics to identify opportunities.

(4)

Staff reduction costs consist of severance expenses related to organizational rationalization.

(5)

Contract termination and related costs associated with third party vendors resulting from the Company’s engagement of FIS.

(6)

In the three months ended December 31, 2023, includes an aggregate of $1.6 million of nonrecurrent expenses in connection with the engagement of FIS and, to a lesser extent, software expenses related to legacy applications running in parallel to new core banking applications. There were no significant nonrecurrent expenses in connection with engagement of FIS in the three months ended June 30, 2024, March 31, 2024 and September 30, 2023. In the three months ended June 30, 2023, includes expenses of $2.0 million in connection with the engagement of FIS.

(7)

Includes expenses in connection with the disposition of fixed assets due to the write off of in-development software in the three months ended June 30, 2023.

(8)

In the three months ended September 30, 2023, consists of expenses in connection with the closure of a branch in Houston, Texas in 2023. In addition, in the three months ended June 30, 2023 includes $0.9 million of accelerated amortization of leasehold improvements and $0.6 million of right-of-use, or ROU asset impairment, associated with the closure of a branch in Miami, FL in 2023.

(9)

In the three months ended December 31, 2023, includes (i) fair value adjustment of $35.5 million related to an aggregate of $401 million in Houston-based CRE loans held for sale which are carried at the lower of cost or fair value, and (ii) a loss on sale of $2.0 million related to a New York-based CRE loan previously carried at the lower of cost or fair value. In the three months ended September 30, 2023, includes a fair value adjustment of $5.6 million related to a New York-based CRE loan held for sale carried at the lower of cost or fair value.

(10)

In the three months ended June 30, 2023, amount represents the loss on sale of repossessed assets in connection with our equipment-financing activities.

(11)

In the three months ended June 30, 2024, amounts shown are in connection with the Houston Transaction.

(12)

Related to Houston branches and included as part of occupancy and equipment expenses. See Exhibit 5 for additional information.

(13)

In the three months ended March 31, 2024, amounts were calculated based upon the effective tax rate for the period of 21.51%. For all of the other periods shown, amounts represent the difference between the prior and current period year-to-date tax effect.

(14)

In the three months ended December 31, 2023, per share amounts and percentages were calculated using the after-tax impact of non-routine items in noninterest expense of $34.2 million and BOLI tax impact of $2.8 million in the same period. In all other periods shown, per share amounts and percentages were calculated using the after tax impact of non-routine items in noninterest expense.

(15)

See 2023 Form 10-K for more information on potential dilutive instruments and its impact on diluted earnings per share computation.

(16)

At June 30, 2024, March 31, 2024, December 31, 2023 and September 30, 2023, other intangible assets primarily consist of naming rights of $2.3 million, $2.4 million, $2.5 million and $2.7 million, respectively, and mortgage servicing rights (“MSRs”) of $1.5 million, $1.4 million, $1.4 million and $1.3 million, respectively. At June 30, 2023 and March 31, 2023, other intangible assets primarily consist of MSRs of $1.3 million and $1.4 million, respectively. Other intangible assets are included in other assets in the Company’s consolidated balance sheets.

(17)

As of June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, amounts were calculated based upon the fair value on debt securities held to maturity, and assuming a tax rate of 25.38%, 25.40%, 25.36%, 25.51%, 25.46% and 25.53%, respectively.

 

Exhibit 3 - Average Balance Sheet, Interest and Yield/Rate Analysis

The following tables present average balance sheet information, interest income, interest expense and the corresponding average yields earned and rates paid for the periods presented. The average balances for loans include both performing and nonperforming balances. Interest income on loans includes the effects of discount accretion and the amortization of non-refundable loan origination fees, net of direct loan origination costs, accounted for as yield adjustments. Average balances represent the daily average balances for the periods presented.

 

Three Months Ended

 

June 30, 2024

March 31, 2024

June 30, 2023

(in thousands, except percentages)

Average

Balances

Income/

Expense

Yield/

Rates

Average Balances

Income/ Expense

Yield/ Rates

Average

Balances

Income/

Expense

Yield/

Rates

Interest-earning assets:

 

 

 

 

 

 

 

 

 

Loan portfolio, net (1)(2)

$

7,049,109

$

124,117

7.08

%

$

6,995,974

$

122,705

7.05

%

$

7,068,034

$

119,570

6.79

%

Debt securities available for sale (3) (4)

 

1,267,828

 

 

14,104

 

4.47

%

 

1,239,762

 

 

13,186

 

4.28

%

 

1,041,039

 

 

10,397

 

4.01

%

Debt securities held to maturity (5)

 

221,106

 

 

1,878

 

3.42

%

 

224,877

 

 

1,967

 

3.52

%

 

236,297

 

 

1,976

 

3.35

%

Debt securities held for trading

 

 

 

 

%

 

 

 

 

%

 

262

 

 

3

 

4.59

%

Equity securities with readily determinable fair value not held for trading

 

2,466

 

 

13

 

2.12

%

 

2,477

 

 

55

 

8.93

%

 

27

 

 

 

%

Federal Reserve Bank and FHLB stock

 

54,664

 

 

955

 

7.03

%

 

50,180

 

 

883

 

7.08

%

 

52,917

 

 

857

 

6.50

%

Deposits with banks

 

364,466

 

 

5,260

 

5.80

%

 

422,841

 

 

5,751

 

5.47

%

 

379,123

 

 

5,694

 

6.02

%

Other short-term investments

 

6,399

 

 

82

 

5.15

%

 

5,932

 

 

78

 

5.29

%

 

 

 

 

%

Total interest-earning assets

 

8,966,038

 

 

146,409

 

6.57

%

 

8,942,043

 

 

144,625

 

6.50

%

 

8,777,699

 

 

138,497

 

6.33

%

Total non-interest-earning assets (6)

 

763,628

 

 

 

 

812,523

 

 

 

 

710,404

 

 

 

Total assets

$

9,729,666

 

 

 

$

9,754,566

 

 

 

$

9,488,103

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

June 30, 2024

March 31, 2024

June 30, 2023

(in thousands, except percentages)

Average

Balances

Income/

Expense

Yield/

Rates

Average

Balances

 

Income/

Expense

 

Yield/

Rates

Average

Balances

Income/

Expense

Yield/

Rates

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

Checking and saving accounts

 

 

 

 

 

 

 

 

 

Interest bearing DDA

$

2,408,979

$

16,779

2.80

%

$

2,445,362

$

17,736

2.92

%

$

2,641,746

$

16,678

2.53

%

Money market

 

1,411,287

 

 

14,973

 

4.27

%

 

1,431,949

 

 

14,833

 

4.17

%

 

1,169,047

 

 

9,401

 

3.23

%

Savings

 

253,625

 

 

26

 

0.04

%

 

262,528

 

 

28

 

0.04

%

 

287,493

 

 

36

 

0.05

%

Total checking and saving accounts

 

4,073,891

 

 

31,778

 

3.14

%

 

4,139,839

 

 

32,597

 

3.17

%

 

4,098,286

 

 

26,115

 

2.56

%

Time deposits

 

2,258,973

 

 

25,971

 

4.62

%

 

2,290,587

 

 

26,124

 

4.59

%

 

2,045,747

 

 

18,528

 

3.63

%

Total deposits

 

6,332,864

 

 

57,749

 

3.67

%

 

6,430,426

 

 

58,721

 

3.67

%

 

6,144,033

 

 

44,643

 

2.91

%

Securities sold under agreements to repurchase

 

124

 

 

2

 

6.49

%

 

 

 

 

%

 

60

 

 

1

 

6.68

%

Advances from the FHLB (7)

 

737,658

 

 

6,946

 

3.79

%

 

644,753

 

 

5,578

 

3.48

%

 

828,301

 

 

7,621

 

3.69

%

Senior notes

 

59,646

 

 

941

 

6.35

%

 

59,567

 

 

943

 

6.37

%

 

59,330

 

 

941

 

6.36

%

Subordinated notes

 

29,519

 

 

361

 

4.92

%

 

29,476

 

 

361

 

4.93

%

 

29,348

 

 

362

 

4.95

%

Junior subordinated debentures

 

64,178

 

 

1,055

 

6.61

%

 

64,178

 

 

1,054

 

6.61

%

 

64,178

 

 

1,052

 

6.57

%

Total interest-bearing liabilities

 

7,223,989

 

 

67,054

 

3.73

%

 

7,228,400

 

 

66,657

 

3.71

%

 

7,125,250

 

 

54,620

 

3.07

%

Non-interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

Non-interest bearing demand deposits

 

1,452,921

 

 

 

 

1,435,226

 

 

 

 

1,332,189

 

 

 

Accounts payable, accrued liabilities and other liabilities

 

309,298

 

 

 

 

344,197

 

 

 

 

283,653

 

 

 

Total non-interest-bearing liabilities

 

1,762,219

 

 

 

 

1,779,423

 

 

 

 

1,615,842

 

 

 

Total liabilities

 

8,986,208

 

 

 

 

9,007,823

 

 

 

 

8,741,092

 

 

 

Stockholders’ equity

 

743,458

 

 

 

 

746,743

 

 

 

 

747,011

 

 

 

Total liabilities and stockholders' equity

$

9,729,666

 

 

 

$

9,754,566

 

 

 

$

9,488,103

 

 

 

Excess of average interest-earning assets over average interest-bearing liabilities

$

1,742,049

 

 

 

$

1,713,643

 

 

 

$

1,652,449

 

 

 

Net interest income

 

$

79,355

 

 

 

$

77,968

 

 

 

$

83,877

 

 

Net interest rate spread

 

 

2.84

%

 

 

2.79

%

 

 

3.26

%

Net interest margin (7)

 

 

3.56

%

 

 

3.51

%

 

 

3.83

%

Cost of total deposits (7)

 

 

2.98

%

 

 

3.00

%

 

 

2.40

%

Ratio of average interest-earning assets to average interest-bearing liabilities

 

124.11

%

 

 

 

123.71

%

 

 

 

123.19

%

 

 

Average non-performing loans/ Average total loans

 

0.60

%

 

 

 

0.46

%

 

 

 

0.54

%

 

 

 

Six Months Ended

 

June 30, 2024

June 30, 2023

(in thousands, except percentages)

Average

Balances

Income/

Expense

Yield/

Rates

Average

Balances

Income/

Expense

Yield/

Rates

Interest-earning assets:

 

 

 

 

 

 

Loan portfolio, net (1)(2)

$

7,018,015

$

246,822

7.07

%

$

6,985,153

$

228,071

6.58

%

Debt securities available for sale (3) (4)

 

1,253,795

 

 

27,290

 

4.38

%

 

1,049,886

 

 

20,568

 

3.95

%

Debt securities held to maturity (5)

 

222,992

 

 

3,845

 

3.47

%

 

238,450

 

 

4,088

 

3.46

%

Debt securities held for trading

 

 

 

 

%

 

141

 

 

4

 

5.72

%

Equity securities with readily determinable fair value not held for trading

 

2,472

 

 

68

 

5.53

%

 

2,443

 

 

 

%

Federal Reserve Bank and FHLB stock

 

52,422

 

 

1,838

 

7.05

%

 

55,346

 

 

1,872

 

6.82

%

Deposits with banks

 

393,654

 

 

11,011

 

5.63

%

 

341,168

 

 

9,024

 

5.33

%

Other short-term investments

 

6,165

 

 

160

 

5.22

%

 

 

 

 

%

Total interest-earning assets

 

8,949,515

 

 

291,034

 

6.54

%

 

8,672,587

 

 

263,627

 

6.13

%

Total non-interest-earning assets (6)

 

792,602

 

 

 

 

725,675

 

 

 

Total assets

$

9,742,117

 

 

 

$

9,398,262

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

Checking and saving accounts

 

 

 

 

 

 

Interest bearing DDA

$

2,427,170

 

$

34,515

 

2.86

%

$

2,493,009

 

$

29,533

 

2.39

%

Money market

 

1,421,618

 

 

29,807

 

4.22

%

 

1,250,801

 

 

17,281

 

2.79

%

Savings

 

258,077

 

 

53

 

0.04

%

 

293,464

 

 

83

 

0.06

%

Total checking and saving accounts

 

4,106,865

 

 

64,375

 

3.15

%

 

4,037,274

 

 

46,897

 

2.34

%

Time deposits

 

2,274,780

 

 

52,095

 

4.61

%

 

1,907,443

 

 

31,362

 

3.32

%

Total deposits

 

6,381,645

 

 

116,470

 

3.67

%

 

5,944,717

 

 

78,259

 

2.65

%

Securities sold under agreements to repurchase

 

62

 

 

2

 

6.49

%

 

30

 

 

1

 

6.72

%

Advances from the FHLB (7)

 

691,206

 

 

12,524

 

3.64

%

 

893,484

 

 

14,384

 

3.25

%

Senior notes

 

59,606

 

 

1,883

 

6.35

%

 

59,290

 

 

1,883

 

6.40

%

Subordinated notes

 

29,497

 

 

723

 

4.93

%

 

29,327

 

 

723

 

4.97

%

Junior subordinated debentures

 

64,178

 

 

2,109

 

6.61

%

 

64,178

 

 

2,167

 

6.81

%

Total interest-bearing liabilities

 

7,226,194

 

 

133,711

 

3.72

%

 

6,991,026

 

 

97,417

 

2.81

%

Non-interest-bearing liabilities:

 

 

 

 

 

 

Non-interest bearing demand deposits

 

1,444,073

 

 

 

 

1,354,951

 

 

 

Accounts payable, accrued liabilities and other liabilities

 

326,809

 

 

 

 

310,716

 

 

 

Total non-interest-bearing liabilities

 

1,770,882

 

 

 

 

1,665,667

 

 

 

Total liabilities

 

8,997,076

 

 

 

 

8,656,693

 

 

 

Stockholders’ equity

 

745,041

 

 

 

 

741,569

 

 

 

Total liabilities and stockholders' equity

$

9,742,117

 

 

 

$

9,398,262

 

 

 

Excess of average interest-earning assets over average interest-bearing liabilities

$

1,723,321

 

 

 

$

1,681,561

 

 

 

Net interest income

 

$

157,323

 

 

 

$

166,210

 

 

Net interest rate spread

 

 

2.82

%

 

 

3.32

%

Net interest margin (7)

 

 

3.54

%

 

 

3.86

%

Cost of total deposits (7)

 

 

2.99

%

 

 

2.16

%

Ratio of average interest-earning assets to average interest-bearing liabilities

 

123.85

%

 

 

 

124.05

%

 

 

Average non-performing loans/ Average total loans

 

0.61

%

 

 

 

0.50

%

 

 

___________

(1)

Includes loans held for investment net of the allowance for credit losses, and loans held for sale. The average balance of the allowance for credit losses was $95.6 million, $92.3 million, and $84.6 million in the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and $94.0 million and $83.0 million, in the six months ended June 30, 2024 and June 30, 2023, respectively. The average balance of total loans held for sale was $191.7 million, $180.5 million and $85.1 million in the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and $90.0 million, and $75.8 million in the six months period ended June 30, 2024 and June 30, 2023, respectively.

(2)

Includes average non-performing loans of $52.7 million, $32.6 million and $38.5 million for the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and $42.7 million and $35.2 million in the six months ended June 30, 2024 and June 30, 2023, respectively.

(3)

Includes the average balance of net unrealized gains and losses in the fair value of debt securities available for sale. The average balance includes average net unrealized losses of $115.8 million, $101.5 million and $106.7 million in the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and average net unrealized net losses of $108.6 million and $105.8 million in the six months ended June 30, 2024 and June 30, 2023, respectively.

(4)

Includes nontaxable securities with average balances of $18.8 million, $18.3 million and $19.5 million for the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and $18.8 million and $19.4 million, in the six months ended June 30, 2024 and June 30, 2023, respectively. The tax equivalent yield for these nontaxable securities was 4.47%, 4.68%, 4.53% for the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and 4.51% and 4.59% in the six months ended June 30, 2024 and June 30, 2023, respectively. In 2024 and 2023, the tax equivalent yields were calculated assuming a 21% tax rate and dividing the actual yield by 0.79.

(5)

Includes nontaxable securities with average balances of $47.8 million, $48.5 million and $50.1 million for the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and $48.1 million and $50.4 million in the six months ended June 30, 2024 and June 30, 2023, respectively. The tax equivalent yield for these nontaxable securities was 4.23%, 4.25% and 4.16% for the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and 4.24% and 4.18% in the six months ended June 30, 2024 and June 30, 2023, respectively. In 2024 and 2023, the tax equivalent yields were calculated assuming a 21% tax rate and dividing the actual yield by 0.79.

(6)

Excludes the allowance for credit losses.

(7)

See Glossary of Terms and Definitions for definitions of financial terms.

Exhibit 4 - Noninterest Income

This table shows the amounts of each of the categories of noninterest income for the periods presented.

 

Three Months Ended

 

Six Months Ended June 30,

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

 

 

2024

 

 

2023

(in thousands, except percentages)

Amount

 

%

 

Amount

 

%

 

Amount

 

%

 

Amount

%

 

Amount

%

 

 

 

 

 

 

 

 

Deposits and service fees

$

5,281

 

 

27.2

%

 

$

4,325

 

 

29.9

%

 

$

4,944

 

 

18.6

%

 

$

9,606

 

28.3

%

 

$

9,899

 

21.5

%

Brokerage, advisory and fiduciary activities

 

4,538

 

 

23.4

%

 

 

4,327

 

 

29.9

%

 

 

4,256

 

 

16.0

%

 

 

8,865

 

26.1

%

 

 

8,438

 

18.4

%

Change in cash surrender value of bank owned life insurance (“BOLI”)(1)

 

2,242

 

 

11.5

%

 

 

2,342

 

 

16.2

%

 

 

1,429

 

 

5.4

%

 

 

4,584

 

13.5

%

 

 

2,841

 

6.2

%

Cards and trade finance servicing fees

 

1,331

 

 

6.9

%

 

 

1,223

 

 

8.4

%

 

 

562

 

 

2.1

%

 

 

2,554

 

7.5

%

 

 

1,095

 

2.4

%

Gain on early extinguishment of FHLB advances, net

 

189

 

 

1.0

%

 

 

 

 

%

 

 

13,440

 

 

50.5

%

 

 

189

 

0.6

%

 

 

26,613

 

57.9

%

Securities (losses) gains, net (2)

 

(117

)

 

(0.6

)%

 

 

(54

)

 

(0.4

)%

 

 

(1,237

)

 

(4.7

)%

 

 

(171

)

(0.5

)%

 

 

(10,968

)

(23.9

)%

Loan-level derivative income (3)

 

2,357

 

 

12.1

%

 

 

466

 

 

3.2

%

 

 

476

 

 

1.8

%

 

 

2,823

 

8.3

%

 

 

2,547

 

5.5

%

Derivative (losses) gains, net (4)

 

(44

)

 

(0.2

)%

 

 

(152

)

 

(1.1

)%

 

 

242

 

 

0.9

%

 

 

(196

)

(0.6

)%

 

 

256

 

0.6

%

Other noninterest income (5)

 

3,643

 

 

18.7

%

 

 

2,011

 

 

13.9

%

 

 

2,507

 

 

9.4

%

 

 

5,654

 

16.8

%

 

 

5,241

 

11.4

%

Total noninterest income

$

19,420

 

 

100.0

%

 

$

14,488

 

 

100.0

%

 

$

26,619

 

 

100.0

%

 

$

33,908

 

100.0

%

 

$

45,962

 

100.0

%

__________________

(1)

Changes in cash surrender value of BOLI are not taxable.

(2)

Includes net loss of $0.1 million in each of the three and six month periods ended June 30, 2024, and $1.2 million and $10.8 million in the three and six month periods ended June 30, 2023 ,respectively, in connection with the sale of debt securities available for sale. There were no sales of debt securities available for sale in the three months ended March 31, 2024. In addition, includes unrealized losses of $0.1 million in the three months ended March 31, 2024 and in the six months ended June 30, 2024, related to the change in fair value of equity securities with readily available fair value not held for trading which are recorded in results of the period. There were no significant unrealized losses related to equity securities with readily available fair value not held for trading in the three months ended June 30, 2024 and in the three and six month periods ended June 30, 2023.

(3)

Income from interest rate swaps and other derivative transactions with customers. The Company incurs expenses related to derivative transactions with customers which are included as part of noninterest expenses under loan-level derivative expense. See Exhibit 5 for more details.

(4)

Net unrealized gains and losses related to uncovered interest rate caps with clients.

(5)

Includes mortgage banking income of $1.9 million, $1.1 million and $1.6 million in the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and $3.0 million and $3.4 million in the six months ended June 30, 2024 and June 30, 2023, respectively, primarily consisting of net gains on sale, valuation and derivative transactions associated with mortgage loans held for sale activity, and other smaller sources of income related to the operations of Amerant Mortgage. In addition, includes $0.5 million BOLI death benefits received in the three and six months ended June 30, 2024. Other sources of income in the periods shown include foreign currency exchange transactions with customers and valuation income on the investment balances held in the non-qualified deferred compensation plan.

Exhibit 5 - Noninterest Expense

This table shows the amounts of each of the categories of noninterest expense for the periods presented.

 

Three Months Ended

Six Months Ended June 30,

 

June 30, 2024

March 31, 2024

June 30, 2023

 

2024

 

2023

(in thousands, except percentages)

Amount

%

Amount

%

Amount

%

Amount

%

Amount

%

 

 

 

 

 

 

Salaries and employee benefits (1)

$

33,857

 

46.2

%

$

32,958

 

49.5

%

$

34,247

47.2

%

$

66,815

 

47.8

%

$

69,123

50.4

%

Occupancy and equipment (2)

 

9,041

 

12.3

%

 

6,476

 

9.7

%

 

6,737

9.3

%

 

15,517

 

11.1

%

 

13,535

 

9.9

%

Professional and other services fees (3)

 

12,110

 

16.5

%

 

10,963

 

16.5

%

 

7,415

10.2

%

 

23,073

 

16.5

%

 

15,043

 

11.0

%

Loan-level derivative expense (4)

 

580

 

0.8

%

 

4

 

%

 

110

0.2

%

 

584

 

0.4

%

 

1,710

 

1.3

%

Telecommunications and data processing (5)

 

2,732

 

3.7

%

 

3,533

 

5.3

%

 

5,027

6.9

%

 

6,265

 

4.5

%

 

8,091

 

5.9

%

Depreciation and amortization (6)

 

1,652

 

2.3

%

 

1,477

 

2.2

%

 

2,275

3.1

%

 

3,129

 

2.2

%

 

3,567

 

2.6

%

FDIC assessments and insurance

 

2,772

 

3.8

%

 

3,008

 

4.5

%

 

2,739

3.8

%

 

5,780

 

4.1

%

 

5,476

 

4.0

%

Losses on loans held for sale carried at the lower cost or fair value (7)

 

1,258

 

1.7

%

 

 

%

 

%

 

1,258

 

0.9

%

 

 

%

Advertising expenses

 

4,243

 

5.8

%

 

3,078

 

4.6

%

 

4,332

6.0

%

 

7,321

 

5.2

%

 

6,918

 

5.0

%

Other real estate owned and repossessed assets (income) expense, net (8)(9)

 

(148

)

(0.2

)%

 

(354

)

(0.5

)%

 

2,431

3.4

%

 

(502

)

(0.4

)%

 

2,431

 

1.8

%

Contract termination costs (9)(10)

 

 

%

 

 

%

 

1,550

2.1

%

 

 

%

 

1,550

 

1.1

%

Other operating expenses (11)

 

5,205

 

7.1

%

 

5,451

 

8.2

%

 

5,637

7.8

%

 

10,656

 

7.7

%

 

9,789

 

7.0

%

Total noninterest expense (12)

$

73,302

 

100.0

%

$

66,594

 

100.0

%

$

72,500

100.0

%

$

139,896

 

100.0

%

$

137,233

 

100.0

%

___

(1)

Includes staff reduction costs of $2.2 million and $2.4 million in the three and six months ended June 30, 2023, respectively, which consist of severance expenses primarily related to organizational rationalization.

(2)

In each of the three and six month periods ended June 30, 2024, includes fixed assets impairment charge of $3.4 million in connection with the Houston Transaction. In each of the three and six month periods ended June 30, 2023, includes $0.6 million related to ROU asset impairment in connection with the closure of branch in Miami, Florida in 2023.

(3)

Includes $0.3 million in legal expenses in connection with the Houston Transaction in the three and six month periods ended June 30, 2024. Additionally, includes additional non-routine expenses of $2.0 million and $4.6 million in the three months and six months ended June 30, 2023, respectively, related to the engagement of FIS. Lastly, includes recurring service fees in connection with the engagement of FIS in the three months ended March 31, 2024 and June 30, 2024 and in the six months ended June 30, 2024.

(4)

Includes services fees in connection with our loan-level derivative income generation activities.

(5)

Includes a charge of $1.4 million in each of the three and six month periods ended June 30, 2023 related to the disposition of fixed assets due to the write off of in-development software.

(6)

Includes a charge of $0.9 million in each of the three and six month periods ended June 30, 2023 for the accelerated depreciation of leasehold improvements in connection with the closure of a branch in Miami, Florida in 2023.

(7)

In each of the three and six month periods ended, amounts shown are in connection with the Houston Transaction

(8)

Includes OREO rental income of $0.4 million in the three months ended March 31, 2024, as well as in the three and six month periods ended June 30, 2023. In addition, in each of the three and six month periods ended June 30, 2023, includes a loss on sale of repossessed assets in connection with our equipment-financing activities of $2.6 million.

(9)

Beginning in the three months ended June 30, 2023, OREO and repossessed assets expense is presented separately in the Company’s consolidated statement of operations and comprehensive (loss) income.

(10)

Contract termination and related costs associated with third party vendors resulting from the Company’s transition to our new technology provider.

(11)

In each of the three and six month periods ended June 30, 2024, includes broker fees of $0.3 million in connection with the Houston Transaction. Additionally, in each of the three and six month periods ended June 30, 2023, includes an impairment charge of $2.0 million related to an investment carried at cost and included in other assets. In all of the periods shown, includes mortgage loan origination and servicing expenses, charitable contributions, community engagement, postage and courier expenses, and debits which mirror the valuation income on the investment balances held in the non-qualified deferred compensation plan in order to adjust the liability to participants of the deferred compensation plan and other small expenses.

(12)

Includes $3.8 million, $3.1 million and $4.0 million in the three months ended June 30, 2024, March 31, 2024 and June 30, 2023, respectively, and $6.9 million and $7.9 million in the six months ended June 30, 2024 and June 30, 2023, related to Amerant Mortgage, primarily consisting of salaries and employee benefits, mortgage lending costs and professional and other services fees.

Exhibit 6 - Consolidated Balance Sheets

(in thousands, except share data)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

Assets

 

 

 

 

(audited)

 

 

 

 

Cash and due from banks

$

32,762

 

 

$

41,231

 

 

$

47,234

 

 

$

48,145

 

 

$

45,184

 

Interest earning deposits with banks

 

238,346

 

 

 

577,843

 

 

 

242,709

 

 

 

202,946

 

 

 

365,673

 

Restricted cash

 

32,430

 

 

 

33,897

 

 

 

25,849

 

 

 

51,837

 

 

 

34,204

 

Other short-term investments

 

6,781

 

 

 

6,700

 

 

 

6,080

 

 

 

6,024

 

 

 

 

Cash and cash equivalents

 

310,319

 

 

 

659,671

 

 

 

321,872

 

 

 

308,952

 

 

 

445,061

 

Securities

 

 

 

 

 

 

 

 

 

Debt securities available for sale, at fair value

 

1,269,356

 

 

 

1,298,073

 

 

 

1,217,502

 

 

 

1,033,797

 

 

 

1,027,676

 

Debt securities held to maturity, at amortized cost (1)

 

219,613

 

 

 

224,014

 

 

 

226,645

 

 

 

230,254

 

 

 

234,369

 

Trading securities

 

 

 

 

 

 

 

 

 

 

 

 

 

298

 

Equity securities with readily determinable fair value not held for trading

 

2,483

 

 

 

2,480

 

 

 

2,534

 

 

 

2,438

 

 

 

2,500

 

Federal Reserve Bank and Federal Home Loan Bank stock

 

56,412

 

 

 

54,001

 

 

 

50,294

 

 

 

47,878

 

 

 

50,460

 

Securities

 

1,547,864

 

 

 

1,578,568

 

 

 

1,496,975

 

 

 

1,314,367

 

 

 

1,315,303

 

Loans held for sale, at the lower of cost or fair value (2)

 

551,828

 

 

 

 

 

 

365,219

 

 

 

43,257

 

 

 

 

Mortgage loans held for sale, at fair value

 

60,122

 

 

 

48,908

 

 

 

26,200

 

 

 

25,952

 

 

 

49,942

 

Loans held for investment, gross

 

6,710,961

 

 

 

6,957,475

 

 

 

6,873,493

 

 

 

7,073,387

 

 

 

7,167,016

 

Less: Allowance for credit losses

 

94,400

 

 

 

96,050

 

 

 

95,504

 

 

 

98,773

 

 

 

105,956

 

Loans held for investment, net

 

6,616,561

 

 

 

6,861,425

 

 

 

6,777,989

 

 

 

6,974,614

 

 

 

7,061,060

 

Bank owned life insurance

 

238,851

 

 

 

237,314

 

 

 

234,972

 

 

 

232,736

 

 

 

231,253

 

Premises and equipment, net

 

33,382

 

 

 

44,877

 

 

 

43,603

 

 

 

43,004

 

 

 

43,714

 

Deferred tax assets, net

 

48,779

 

 

 

48,302

 

 

 

55,635

 

 

 

63,501

 

 

 

56,779

 

Operating lease right-of-use assets

 

100,580

 

 

 

117,171

 

 

 

118,484

 

 

 

116,763

 

 

 

116,161

 

Goodwill

 

19,193

 

 

 

19,193

 

 

 

19,193

 

 

 

20,525

 

 

 

20,525

 

Accrued interest receivable and other assets (3)(4)

 

220,259

 

 

 

202,343

 

 

 

256,185

 

 

 

202,029

 

 

 

179,728

 

Total assets

$

9,747,738

 

 

$

9,817,772

 

 

$

9,716,327

 

 

$

9,345,700

 

 

$

9,519,526

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

Demand

 

 

 

 

 

 

 

 

 

Noninterest bearing

$

1,465,140

 

 

$

1,397,331

 

 

$

1,426,919

 

 

$

1,370,157

 

 

$

1,293,522

 

Interest bearing

 

2,316,976

 

 

 

2,619,115

 

 

 

2,560,629

 

 

 

2,416,797

 

 

 

2,773,120

 

Savings and money market

 

1,723,233

 

 

 

1,616,719

 

 

 

1,610,218

 

 

 

1,457,080

 

 

 

1,431,375

 

Time

 

2,310,662

 

 

 

2,245,078

 

 

 

2,297,097

 

 

 

2,302,878

 

 

 

2,081,554

 

Total deposits

 

7,816,011

 

 

 

7,878,243

 

 

 

7,894,863

 

 

 

7,546,912

 

 

 

7,579,571

 

Advances from the Federal Home Loan Bank

 

765,000

 

 

 

715,000

 

 

 

645,000

 

 

 

595,000

 

 

 

770,000

 

Senior notes

 

59,685

 

 

 

59,605

 

 

 

59,526

 

 

 

59,447

 

 

 

59,368

 

Subordinated notes

 

29,539

 

 

 

29,497

 

 

 

29,454

 

 

 

29,412

 

 

 

29,369

 

Junior subordinated debentures held by trust subsidiaries

 

64,178

 

 

 

64,178

 

 

 

64,178

 

 

 

64,178

 

 

 

64,178

 

Operating lease liabilities (5)

 

105,861

 

 

 

122,267

 

 

 

123,167

 

 

 

120,665

 

 

 

119,921

 

Accounts payable, accrued liabilities and other liabilities (6)

 

173,122

 

 

 

210,897

 

 

 

164,071

 

 

 

210,299

 

 

 

176,163

 

Total liabilities

 

9,013,396

 

 

 

9,079,687

 

 

 

8,980,259

 

 

 

8,625,913

 

 

 

8,798,570

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

 

Class A common stock

 

3,357

 

 

 

3,373

 

 

 

3,361

 

 

 

3,359

 

 

 

3,374

 

Additional paid in capital

 

189,601

 

 

 

192,237

 

 

 

192,701

 

 

 

194,103

 

 

 

195,275

 

Retained earnings

 

620,299

 

 

 

618,359

 

 

 

610,802

 

 

 

630,933

 

 

 

611,829

 

Accumulated other comprehensive loss

 

(78,915

)

 

 

(75,884

)

 

 

(70,796

)

 

 

(105,634

)

 

 

(86,926

)

Total stockholders' equity before noncontrolling interest

 

734,342

 

 

 

738,085

 

 

 

736,068

 

 

 

722,761

 

 

 

723,552

 

Noncontrolling interest

 

 

 

 

 

 

 

 

 

 

(2,974

)

 

 

(2,596

)

Total stockholders' equity

 

734,342

 

 

 

738,085

 

 

 

736,068

 

 

 

719,787

 

 

 

720,956

 

Total liabilities and stockholders' equity

$

9,747,738

 

 

$

9,817,772

 

 

$

9,716,327

 

 

$

9,345,700

 

 

$

9,519,526

 

__________

(1)

Estimated fair value of $192,403, $198,909, $204,945, $195,165 and $209,546 at June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023 and June 30, 2023, respectively.

(2)

As of June 30, 2024, includes loans held for sale and a valuation allowance of $1.3 million, in connection with the Houston Transaction. As of December 31, 2023 and September 30, 2023, includes a valuation allowance of $35.5 million and $5.6 million as a result of fair value adjustment.

(3)

As of June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023 and June 30, 2023, includes derivative assets with a total fair value of $64.0 million, $64.7 million, $59.9 million, $87.1 million and $75.8 million, respectively. As of December 31, 2023, includes a receivable from insurance carrier for $62.5 million in connection with the restructuring of the Company’s BOLI in the fourth quarter of 2023, which were collected in the first quarter of 2024.

(4)

Includes other assets for sale of $22.8 million in connection with the Houston Transaction.

(5)

Consists of total long-term lease liabilities. Total short-term lease liabilities are included in other liabilities.

(6)

As of June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023 and June 30, 2023, includes derivatives liabilities with a total fair value of $62.9 million, $63.8 million, $59.4 million, $85.6 million and $74.5 million, respectively.

Exhibit 7 - Loans

Loans by Type - Held For Investment

The loan portfolio held for investment consists of the following loan classes:

(in thousands)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

Real estate loans

 

 

 

 

(audited)

 

 

 

 

Commercial real estate

 

 

 

 

 

 

 

 

 

Non-owner occupied

$

1,714,088

 

$

1,672,470

 

$

1,616,200

 

$

1,593,571

 

$

1,645,224

Multi-family residential

 

359,257

 

 

 

349,917

 

 

 

407,214

 

 

 

771,654

 

 

 

764,712

 

Land development and construction loans

 

343,472

 

 

 

333,198

 

 

 

300,378

 

 

 

301,938

 

 

 

314,010

 

 

 

2,416,817

 

 

 

2,355,585

 

 

 

2,323,792

 

 

 

2,667,163

 

 

 

2,723,946

 

Single-family residential

 

1,446,569

 

 

 

1,490,711

 

 

 

1,466,608

 

 

 

1,371,194

 

 

 

1,285,857

 

Owner occupied

 

981,405

 

 

 

1,193,909

 

 

 

1,175,331

 

 

 

1,129,921

 

 

 

1,063,240

 

 

 

4,844,791

 

 

 

5,040,205

 

 

 

4,965,731

 

 

 

5,168,278

 

 

 

5,073,043

 

Commercial loans

 

1,521,533

 

 

 

1,550,140

 

 

 

1,503,187

 

 

 

1,452,759

 

 

 

1,577,209

 

Loans to financial institutions and acceptances

 

48,287

 

 

 

29,490

 

 

 

13,375

 

 

 

13,353

 

 

 

13,332

 

Consumer loans and overdrafts (1)

 

296,350

 

 

 

337,640

 

 

 

391,200

 

 

 

438,997

 

 

 

503,432

 

Total loans

$

6,710,961

 

 

$

6,957,475

 

 

$

6,873,493

 

 

$

7,073,387

 

 

$

7,167,016

 

__________________

(1)

As of June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023 and June 30, 2023 includes $131.9 million, $163.3 million, $210.9 million, $254.7 million and $312.3 million, respectively, in consumer loans purchased under indirect lending programs.

Loans by Type - Held For Sale

The loan portfolio held for sale consists of the following loan classes:

(in thousands)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

Loans held for sale at the lower of cost or fair value

 

 

 

 

(audited)

 

 

 

 

Real estate loans

 

 

 

 

 

 

 

 

 

Commercial real estate

 

 

 

 

 

 

 

 

 

Non-owner occupied

$

112,002

 

$

 

$

 

$

43,256

 

$

Multi-family residential

 

918

 

 

 

 

 

 

309,612

 

 

 

 

 

 

 

Land development and construction loans

 

29,923

 

 

 

 

 

 

55,607

 

 

 

 

 

 

 

 

 

142,843

 

 

 

 

 

 

365,219

 

 

 

43,256

 

 

 

 

Single-family residential

 

88,507

 

 

 

 

 

 

 

 

 

 

 

 

 

Owner occupied

 

220,718

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

452,068

 

 

 

 

 

 

365,219

 

 

 

43,256

 

 

 

 

Commercial loans

 

90,353

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer loans

 

9,407

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans held for sale at the lower of cost or fair value (1)

 

551,828

 

 

 

 

 

 

365,219

 

 

 

43,256

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage loans held for sale at fair value

 

 

 

 

 

 

 

 

 

Land development and construction loans (2)

 

7,776

 

 

 

26,058

 

 

 

12,778

 

 

 

6,931

 

 

 

3,726

 

Single-family residential (3)

 

52,346

 

 

 

22,850

 

 

 

13,422

 

 

 

19,022

 

 

 

46,216

 

Total mortgage loans held for sale at fair value (4)

 

60,122

 

 

 

48,908

 

 

 

26,200

 

 

 

25,953

 

 

 

49,942

 

Total loans held for sale (5)

$

611,950

 

 

$

48,908

 

 

$

391,419

 

 

$

69,209

 

 

$

49,942

 

__________________

(1)

In the second quarter of 2024, the Company transferred an aggregate of $551.8 million in connection with the Houston Transaction. The Company recorded a valuation allowance of $1.3 million as a result of the transfer in the same period. In the fourth quarter of 2023, the Company transferred an aggregate of $401 million in Houston-based CRE loans held for investment to the loans held for sale category, and recognized a valuation allowance of $35.5 million as a result of the fair value adjustment of these loans. The Company subsequently sold these loans in the first quarter of 2024 and there was no material impact to the Company’s results of operations as a result of this transaction. In the third quarter of 2023, the Company transferred a New York-based CRE loan held for investment to the loans held for sale category, and recognized a valuation allowance of $5.6 million as a result of the fair value adjustment of this loan. In the fourth quarter of 2023, the Company sold this loan and there was no material impact to the Company’s results of operations as a result of this transaction.

(2)

In the second quarter of 2023, the Company transferred approximately $13 million in land development and construction loans held for sale to the loans held for investment category.

(3)

In the fourth, third and second quarters of 2023, the Company transferred approximately $17 million, $17 million and $28 million, respectively, in single-family residential loans held for sale to the loans held for investment category. In the first quarter of 2024, there were no significant transfers of single-family residential loans from the loans held for sale to the loans held for investment category.

(4)

Loans held for sale in connection with Amerant Mortgage’s ongoing business.

(5)

Remained current and in accrual status at each of the periods shown.

Non-Performing Assets

This table shows a summary of our non-performing assets by loan class, which includes non-performing loans, other real estate owned, or OREO, and other repossessed assets at the dates presented. Non-performing loans consist of (i) nonaccrual loans, and (ii) accruing loans 90 days or more contractually past due as to interest or principal.

(in thousands)

June 30,

2024

 

March 31,

2024

 

December 31,

2023

 

September 30,

2023

 

June 30,

2023

Non-Accrual Loans

 

 

 

 

(audited)

 

 

 

 

Real Estate Loans

 

 

 

 

 

 

 

 

 

Commercial real estate (CRE)

 

 

 

 

 

 

 

 

 

Non-owner occupied

$

 

$

 

$

 

$

 

$

1,696

Multi-family residential

 

6

 

 

 

 

 

 

8

 

 

 

23,344

 

 

 

24,306

 

 

 

6

 

 

 

 

 

 

8

 

 

 

23,344

 

 

 

26,002

 

Single-family residential

 

3,726

 

 

 

4,400

 

 

 

2,459

 

 

 

2,533

 

 

 

1,681

 

Owner occupied

 

26,309

 

 

 

1,958

 

 

 

3,822

 

 

 

2,100

 

 

 

6,890

 

 

 

30,041

 

 

 

6,358

 

 

 

6,289

 

 

 

27,977

 

 

 

34,573

 

Commercial loans

 

67,005

 

 

 

21,833

 

 

 

21,949

 

 

 

4,713

 

 

 

12,241

 

Consumer loans and overdrafts

 

4

 

 

 

45

 

 

 

38

 

 

 

1

 

 

 

1

 

Total Non-Accrual Loans (1)

$

97,050

 

 

$

28,236

 

 

$

28,276

 

 

$

32,691

 

 

$

46,815

 

 

 

 

 

 

 

 

 

 

 

Past Due Accruing Loans(2)

 

 

 

 

 

 

 

 

 

Real Estate Loans

 

 

 

 

 

 

 

 

 

Owner occupied

 

769

 

 

 

 

 

 

 

 

 

 

 

 

 

Single-family residential

 

2,656

 

 

 

1,149

 

 

 

5,218

 

 

 

 

 

 

302

 

Commercial

 

 

 

 

918

 

 

 

857

 

 

 

504

 

 

 

Consumer loans and overdrafts

 

477

 

 

 

 

 

 

49

 

 

 

 

 

 

78

 

Total Past Due Accruing Loans

$

3,902

 

 

$

2,067

 

 

$

6,124

 

 

$

504

 

 

$

380

 

Total Non-Performing Loans

 

100,952

 

 

 

30,303

 

 

 

34,400

 

 

 

33,195

 

 

 

47,195

 

Other Real Estate Owned

 

20,181

 

 

 

20,181

 

 

 

20,181

 

 

 

20,181

 

 

 

20,181

 

Total Non-Performing Assets

$

121,133

 

 

$

50,484

 

 

$

54,581

 

 

$

53,376

 

 

$

67,376

 

__________________

(1)

See March 31, 2024 Form 10-Q and 2023 Form 10-K for more information about the activity of non-accrual loans in the first quarter of 2024 and all periods in 2023.

(2)

Loans past due 90 days or more but still accruing.

Loans by Credit Quality Indicators

This table shows the Company’s loans by credit quality indicators. The Company has not purchased credit-impaired loans.

 

June 30, 2024

March 31, 2024

June 30, 2023

 

 

 

 

 

 

 

(in thousands)

Special Mention

Substandard

Doubtful

Total (1)

Special Mention

Substandard

Doubtful

Total (1)

Special Mention

Substandard

Doubtful

Total (1)

Real Estate Loans

 

 

 

 

 

 

 

 

 

 

 

 

Commercial Real

Estate (CRE)

 

 

 

 

 

 

 

 

 

 

 

 

Non-owner

occupied

$

33,979

$

$

$

33,979

$

$

$

$

$

8,301

$

1,753

$

$

10,054

Multi-family residential

 

 

 

6

 

 

 

 

6

 

 

 

 

6

 

 

 

 

6

 

 

 

 

24,306

 

 

 

 

24,306

 

Land development

and

construction

loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,497

 

 

 

 

 

 

6,497

 

 

 

33,979

 

 

6

 

 

 

 

33,985

 

 

 

 

6

 

 

 

 

6

 

 

14,798

 

 

26,059

 

 

 

 

40,857

 

Single-family residential

 

 

 

3,684

 

 

 

 

3,684

 

 

 

 

3,715

 

 

 

 

3,715

 

 

 

 

2,154

 

 

 

 

2,154

 

Owner occupied

 

35,642

 

 

26,381

 

 

 

 

62,023

 

 

40,666

 

 

2,023

 

 

 

 

42,689

 

 

2,236

 

 

6,972

 

 

 

 

9,208

 

 

 

69,621

 

 

30,071

 

 

 

 

99,692

 

 

40,666

 

 

5,744

 

 

 

 

46,410

 

 

17,034

 

 

35,185

 

 

 

 

52,219

 

Commercial loans

 

25,671

 

 

67,836

 

 

 

 

93,507

 

 

63,172

 

 

22,800

 

 

 

 

85,972

 

 

13,029

 

 

13,312

 

 

3

 

 

26,344

 

Consumer loans and

overdrafts

 

 

 

 

 

 

 

 

 

 

 

36

 

 

 

 

36

 

 

 

 

70

 

 

 

 

70

 

Totals

$

95,292

 

$

97,907

 

$

 

$

193,199

 

$

103,838

 

$

28,580

 

$

 

$

132,418

 

$

30,063

 

$

48,567

 

$

3

 

$

78,633

 

__________

(1)

There were no loans categorized as “loss” as of the dates presented.

Exhibit 8 - Deposits by Country of Domicile

This table shows the Company’s deposits by country of domicile of the depositor as of the dates presented.

(in thousands)

June 30, 2024

 

March 31, 2024

 

December 31, 2023

 

September 30, 2023

 

June 30, 2023

 

 

 

 

 

(audited)

 

 

 

 

Domestic

$

5,281,946

 

$

5,288,702

 

$

5,430,059

 

$

5,067,937

 

$

5,113,604

Foreign:

 

 

 

 

 

 

 

 

 

Venezuela

 

1,918,134

 

 

 

1,988,470

 

 

 

1,870,979

 

 

 

1,892,453

 

 

 

1,912,994

 

Others

 

615,931

 

 

 

601,071

 

 

 

593,825

 

 

 

586,522

 

 

 

552,973

 

Total foreign

 

2,534,065

 

 

 

2,589,541

 

 

 

2,464,804

 

 

 

2,478,975

 

 

 

2,465,967

 

Total deposits

$

7,816,011

 

 

$

7,878,243

 

 

$

7,894,863

 

 

$

7,546,912

 

 

$

7,579,571

 

Glossary of Terms and Definitions

  • Total gross loans: include loans held for investment net of unamortized deferred loan origination fees and costs, as well as loans held for sale.
  • Core deposits: consist of total deposits excluding all time deposits.
  • Assets under management and custody: consists of assets held for clients in an agency or fiduciary capacity which are not assets of the Company and therefore are not included in the consolidated financial statements.
  • Net interest margin, or NIM: defined as net interest income, or NII, divided by average interest-earning assets, which are loans, securities, deposits with banks and other financial assets which yield interest or similar income.
  • ROA and Core ROA are calculated based upon the average daily balance of total assets.
  • ROE and Core ROE are calculated based upon the average daily balance of stockholders’ equity.
  • Total revenue is the result of net interest income before provision for credit losses plus noninterest income.
  • Total capital ratio: total stockholders’ equity divided by total risk-weighted assets, calculated according to the standardized regulatory capital ratio calculations.
  • Tier 1 capital ratio: Tier 1 capital divided by total risk-weighted assets. Tier 1 capital is composed of Common Equity Tier 1 (CET1) capital plus outstanding qualifying trust preferred securities of $62.3 million at each of all the dates presented.
  • Tier 1 leverage ratio: Tier 1 capital divided by quarter to date average assets.
  • Common equity tier 1 capital ratio, CET1: Tier 1 capital divided by total risk-weighted assets.
  • Tangible common equity ratio: calculated as the ratio of common equity less goodwill and other intangibles divided by total assets less goodwill and other intangible assets. Other intangible assets primarily consist of naming rights and mortgage servicing rights and are included in other assets in the Company’s consolidated balance sheets.
  • Tangible common equity ratio, adjusted for unrealized losses on debt securities held to maturity: calculated in the same manner described in tangible common equity but also includes unrealized losses on debt securities held to maturity in the balance of common equity and total assets.
  • Loans to Deposits ratio: calculated as the ratio of total loans gross divided by total deposits.
  • Non-performing assets include all accruing loans past due by 90 days or more, all nonaccrual loans and other real estate owned (“OREO”) properties acquired through or in lieu of foreclosure, and other repossessed assets.
  • Non-performing loans include all accruing loans past due by 90 days or more and all nonaccrual loans
  • Ratio for net charge-offs/average total loans held for investments: calculated based upon the average daily balance of outstanding loan principal balance net of unamortized deferred loan origination fees and costs, excluding the allowance for credit losses.
  • Other operating expenses: total noninterest expense less salary and employee benefits.
  • Efficiency ratio: total noninterest expense divided by the sum of noninterest income and NII.
  • The terms of the FHLB advance agreements require the Bank to maintain certain investment securities or loans as collateral for these advances.
  • Cost of total deposits: calculated based upon the average balance of total noninterest bearing and interest bearing deposits, which includes time deposits.

 

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