FIRST BUSEY CORP NV
For the period ended Dec 31, 2023. Filed Feb 23, 2024.
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FY2023 · Filed Feb 23, 2024
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Noninterest Expense
Changes in noninterest expense are summarized in the tables below for the periods presented(dollars in thousands):
| Years Ended December 31, | ||||
|---|---|---|---|---|
| 2023 | 2022 | Change | % Change | |
| Noninterest expense | ||||
| Salaries, wages, and employee benefits | $162,597 | $159,016 | $3,581 | 2.3% |
| Data processing | 23,708 | 21,648 | 2,060 | 9.5% |
| Premises expenses: | ||||
| Net occupancy expense of premises | 18,214 | 19,130 | (916) | (4.8)% |
| Furniture and equipment expenses | 6,759 | 7,645 | (886) | (11.6)% |
| Combined, net occupancy expense of premises and furniture and equipment expenses | 24,973 | 26,775 | (1,802) | (6.7)% |
| Professional fees | 7,147 | 6,125 | 1,022 | 16.7% |
| Amortization of intangible assets | 10,432 | 11,628 | (1,196) | (10.3)% |
| Interchange expense | 6,864 | 6,298 | 566 | 9.0% |
| FDIC insurance | 5,650 | 4,058 | 1,592 | 39.2% |
| Other expense | 44,161 | 48,333 | (4,172) | (8.6)% |
| Total noninterest expense | $285,532 | $283,881 | $1,651 | 0.6% |
| Income taxes | $31,339 | $33,426 | $(2,087) | (6.2)% |
| Effective income tax rate | 20.4% | 20.7% | (30) bps | |
| Efficiency ratio1 | 61.7% | 59.9% | 180 bps | |
| Adjusted efficiency ratio1 | 60.7% | 58.9% | 180 bps | |
| Full-time equivalent associates as of period-end | 1,479 | 1,497 | (18) | (1.2)% |
- The efficiency ratio and adjusted efficiency ratio are both non-GAAP financial measures. For a reconciliation of non-GAAP financial measure to the most directly comparable GAAP financial measures, see“Item 1. Business—Non-GAAP Financial Information.”
First Busey Corporation | 2023 — 65
| Years Ended December 31, | ||||
|---|---|---|---|---|
| 2022 | 2021 | Change | % Change | |
| Noninterest expense | ||||
| Salaries, wages, and employee benefits | $159,016 | $145,312 | $13,704 | 9.4% |
| Data processing | 21,648 | 21,862 | (214) | (1.0)% |
| Premises expenses: | ||||
| Net occupancy expense of premises | 19,130 | 18,346 | 784 | 4.3% |
| Furniture and equipment expenses | 7,645 | 8,301 | (656) | (7.9)% |
| Combined, net occupancy expense of premises and furniture and equipment expenses | 26,775 | 26,647 | 128 | 0.5% |
| Professional fees | 6,125 | 7,549 | (1,424) | (18.9)% |
| Amortization of intangible assets | 11,628 | 11,274 | 354 | 3.1% |
| Interchange expense | 6,298 | 5,792 | 506 | 8.7% |
| FDIC insurance | 4,058 | 3,083 | 975 | 31.6% |
| Other expense | 48,333 | 40,261 | 8,072 | 20.0% |
| Total noninterest expense | $283,881 | $261,780 | $22,101 | 8.4% |
| Income taxes | $33,426 | $33,374 | $52 | 0.2% |
| Effective income tax rate | 20.7% | 21.3% | (60) bps | |
| Efficiency ratio1 | 59.9% | 62.2% | (230) bps | |
| Adjusted efficiency ratio1 | 58.9% | 57.9% | 100 bps | |
| Full-time equivalent associates as of period-end | 1,497 | 1,463 | 34 | 2.3% |
- The efficiency ratio and adjusted efficiency ratio are both non-GAAP financial measures. For a reconciliation of non-GAAP financial measure to the most directly comparable GAAP financial measures, see“Item 1. Business—Non-GAAP Financial Information.”
Total noninterest expense increased to $285.5 million for the year ended December 31, 2023, compared to $283.9 million for the year ended December 31, 2022, representing a modest year-over-year increase of 0.6%. Non-operating acquisition and other restructuring expenses decreased to $4.3 million in 2023, compared to $4.5 million in 2022. We have effectively managed our noninterest expense during a time of decades-high inflation, and have been purposeful in our efforts to rationalize our expense base given our economic outlook and our view on the future of banking.
Salaries, wages, and employee benefits increased to $162.6 million in 2023, compared to $159.0 million in 2022. Our total associate base consisted of 1,479 full-time equivalents as of December 31, 2023, compared to 1,497 at December 31, 2022. Non-operating costs contributed $0.8 million of the increase in salaries, wages, and employee benefits. Current trends continue to reflect a competitive labor market, maintaining pressure on costs related to attracting and maintaining our skilled workforce.
Data processing expense increased to $23.7 million in 2023, compared to $21.6 million in 2022. Increases were primarily attributable to Company-wide investments in technology enhancements, as well as inflation-driven price increases.
First Busey Corporation | 2023 — 66
Combined, net occupancy expense of premises and furniture and equipment expenses decreased to $25.0 million in 2023, compared to $26.8 million in 2022. Decreases were primarily attributable to declines in depreciation expense and real estate taxes.
Professional fees increased to $7.1 million in 2023, compared to $6.1 million in 2022. The increase was primarily attributable to higher expenses for audit and accounting fees and payroll services.
Amortization of intangible assets decreased to $10.4 million in 2023, compared to $11.6 million in 2022, due to the continued use of an accelerated amortization methodology.
Interchange expense increased to $6.9 million in 2023, compared to $6.3 million in 2022. Fluctuations in interchange expense were primarily the result of increased payment and volume activity at FirsTech.
FDIC insurance expense increased to $5.7 million in 2023, compared to $4.1 million in 2022. Increases were the result of an FDIC final rule to increase the initial base deposit insurance assessment rate applicable to all depository institutions by two basis points beginning in 2023.
Other expense decreased to $44.2 million in 2023, compared to $48.3 million in 2022. Primary contributors to other expense include business development, collection and preservation, OREO, fixed asset impairments, provision for unfunded commitments, and NMTC impairments. Decreases were across multiple expense categories as a result of expense discipline.
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