BYLINE BANCORP INC
For the period ended Sep 30, 2024. Filed Nov 1, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Nov 1, 2024
BY$38.12+0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-05.
0000950170-24-090900
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-01.
0000950170-24-120042
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 239 previous paragraphs and 241 current paragraphs.
167 unchanged; 66 reworded; 7 added; 6 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 27 previous and 27 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (7)
Current report
We reported consolidated net income of $30.3 million, or $0.70 per basic and $0.69 diluted common share, and $90.4 million or $2.08 per basic and $2.07 per diluted share for the three and nine months ended September 30, 2024, compared to net income of $28.2 million, or $0.66 per basic and $0.65 per diluted common share, and $78.3 million or $2.01 per basic and $1.98 per diluted share and for the three and nine months ended September 30, 2023, an increase of $2.1 million and $12.2 million, respectively.
Current report
For the three months ended September 30, 2024 compared to the same period in the prior year, the increase in net income was attributable to a $3.6 million decrease in non-interest expense, and a $2.0 million increase in non-interest income, offset by a $5.0 million decrease in net interest income. For the nine months ended September 30, 2024 compared to the same period in the prior year, the increase to net income was primarily attributable to a $15.2 million increase in net interest income and a $4.3 million decrease in the provision for credit losses, offset by a $5.3 million increase in non-interest expenses and a $2.8 million increase to the provision for income taxes.
Current report
First Security Bancorp, Inc. Acquisition
Current report
On September 30, 2024, we announced the execution of an Agreement and Plan of Merger in connection with a proposed acquisition of First Security Bancorp, Inc., a Delaware corporation ("First Security Bancorp"), and First Security Bancorp's wholly-owned bank subsidiary, First Security Trust and Savings Bank (“First Security’), an Illinois chartered bank. As of June 30, 2024, First Security Bancorp reported $354.8 million in assets, $201.4 million of loans, and $321.8 million of deposits. The consideration to be paid by the Company will consist of shares of Byline common stock (currently estimated at approximately 1.5 million shares), subject to adjustments as set forth in the merger agreement. Outstanding First Security Bancorp preferred shares will be redeemed in cash at closing with an estimated aggregated value of approximately $2.6 million. Completion of the transaction is subject to regulatory approvals, the approval of First Security Bancorp's stockholders, and the satisfaction of certain other closing conditions. We expect the acquisition to close in the first half of 2025.
Current report
We reported consolidated net income of $30.3 million for the three months ended September 30, 2024 compared to net income of $28.2 million for the three months ended September 30, 2023, an increase of $2.1 million. The increase in net income was attributable to a $3.6 million decrease in non-interest expense, and a $2.0 million increase in non-interest income, offset by a $5.0 million decrease in net interest income. Net income was $0.70 per basic and $0.69 per diluted common share, for the three months ended September 30, 2024 compared to $0.66 per basic and $0.65 per diluted common share, for the three months ended September 30, 2023.
Current report
The net interest margin for the three months ended September 30, 2024 was 3.88%, a decrease of 58 basis points compared to 4.46% for the three months ended September 30, 2023. The decrease was primarily attributable to lower loan accretion income and higher rates paid on deposits. The net interest margin for the nine months ended September 30, 2024 was 3.95%, a decrease of 44 basis points compared to 4.39% for the nine months ended September 30, 2023. The decrease was primarily attributable to higher rates paid on deposits.
Current report
Data processing was $4.2 million for the three months ended September 30, 2024 compared to $6.5 million for the three months ended September 30, 2023, a decrease of $2.3 million or 34.9%. Data processing was $12.4 million for the nine months ended September 30, 2024, compared to $14.5 million for the nine months ended September 30, 2023, a decrease of $2.1 million or 14.7%. The decreases were driven by merger-related expenses incurred during 2023.
Removed paragraphs (6)
Previous report
We reported consolidated net income of $29.7 million, or $0.68 per basic and diluted common share, and $60.1 million or $1.39 per basic and $1.37 per diluted share for the three and six months ended June 30, 2024, compared to net income of $26.1 million, or $0.70 per basic and diluted common share, and $50.1 million or $1.35 per basic and $1.34 per diluted share and for the three and six months ended June 30, 2023, an increase of $3.6 million and $10.1 million for the three and six month periods. The increase in net income was attributable to a $10.4 million and $20.2 million increase in net interest income for the three and six months ended June 30, 2024. The increase in net interest income during the three and six months ended June 30, 2024 was primarily driven by higher yields on loans and leases, and organic growth in the loan and lease portfolio, as well as growth in the portfolio as a result of the Inland acquisition.
Previous report
Dividends declared on common shares were $7.9 million and $6.8 million for the six months ended June 30, 2024 and 2023, respectively. Dividends paid on common shares were $8.0 million and $6.7 million for the six months ended June 30, 2024 and 2023, respectively.
Previous report
We reported consolidated net income of $29.7 million for the three months ended June 30, 2024 compared to net income of $26.1 million for the three months ended June 30, 2023, an increase of $3.6 million. The increase in net income was primarily attributable to a $10.4 million increase in net interest income, offset by a decrease in non-interest income of $1.4 million and an increase in non-interest expense of $3.9 million and provision for income taxes of $1.2 million. Net income available to common stockholders was $0.68 per basic and per diluted common share, for the three months ended June 30, 2024 compared to $0.70 per basic and per diluted common share, for the three months ended June 30, 2023. The increase in provision for income taxes was due to higher income before taxes.
Previous report
The net interest margin for the three months ended June 30, 2024 was 3.98%, a decrease of 34 basis points compared to 4.32% for the three months ended June 30, 2023. The decrease was primarily attributable to the rising rate environment. The net interest margin for the six months ended June 30, 2024 was 3.99%, a decrease of 36 basis points compared to 4.35% for the six months ended June 30, 2023. The decrease was primarily attributable to the rising rate environment.
Previous report
Data processing was $4.0 million for the three months ended June 30, 2024 compared to $4.3 million for the three months ended June 30, 2023, a decrease of $236,000 or 5.5%. The decrease was driven by lower IT infrastructure expenses. Data processing was $8.2 million for the six months ended June 30, 2024, compared to $8.1 million for the six months ended June 30, 2023, an increase of $126,000 or 1.6%. The increases were driven by increased software licensing expenses.
Previous report
Our exposure to non-owner occupied commercial real estate office space as of June 30, 2024 was $196.7 million, or 2.9% of our total loan and lease portfolio.
Reworded paragraphs (66)
Previous wording
We are a bank holding company headquartered in Chicago, Illinois, and conduct all our business activities through our subsidiary, Byline Bank, a full service commercial bank, and Byline Bank’s subsidiaries. Through Byline Bank, we offer a broad range of banking products and services to small and medium sized businesses, commercial real estate and financial sponsors and to consumers who generally live or work near our branches. We also offer online account opening to consumer and business customers through our website and provide trust and wealth management services to our customers. In addition to our traditional commercial banking business, we provide small ticket equipment leasing solutions through Byline Financial Group, a wholly-owned subsidiary of Byline Bank, headquartered in Bannockburn, Illinois, with sales offices in Illinois, and sales representatives in Illinois, Michigan, New Jersey, and New York. We participate in U.S. government guaranteed lending programs and originate U.S. government guaranteed loans. Byline Bank is a leading originator of SBA loans and was the second most active 7(a) and 504 lender in Illinois for the quarter ended June 30, 2024.
Current wording
We are a bank holding company headquartered in Chicago, Illinois, and conduct all our business activities through our subsidiary, Byline Bank, a full service commercial bank, and Byline Bank’s subsidiaries. Through Byline Bank, we offer a broad range of banking products and services to small and medium sized businesses, commercial real estate and financial sponsors and to consumers who generally live or work near our branches. We also offer online account opening to consumer and business customers through our website and provide trust and wealth management services to our customers. In addition to our traditional commercial banking business, we provide small ticket equipment leasing solutions through Byline Financial Group, a wholly-owned subsidiary of Byline Bank, headquartered in Bannockburn, Illinois, with sales offices in Illinois, and sales representatives in Illinois, Michigan, New Jersey, and New York. We participate in U.S. government guaranteed lending programs and originate U.S. government guaranteed loans. Byline Bank is a leading originator of SBA loans and was the most active 7(a) and 504 lender in Illinois for the fiscal year ended September 30, 2024.
Previous wording
Dividends declared on common shares were $4.0 million and $3.4 million for the three months ended June 30, 2024 and 2023, respectively. Dividends paid on common shares were $4.0 million and $3.3 million for the three months ended June 30, 2024 and 2023, respectively.
Current wording
Dividends declared on common shares were $4.0 million and $3.9 million for the three months ended September 30, 2024 and 2023, respectively. Dividends paid on common shares were $3.9 million and $4.1 million for the three months ended September 30, 2024 and 2023, respectively. Dividends declared on common shares were $11.9 million and $10.7 million for the nine months ended September 30, 2024 and 2023, respectively. Dividends paid on common shares were $11.9 million and $10.7 million for the nine months ended September 30, 2024 and 2023, respectively.
Previous wording
Our results of operations for the three months ended June 30, 2024 and 2023 yielded an annualized return on average assets of 1.31% and 1.41% and an annualized return on average stockholders’ equity of 11.83% and 12.99%, respectively. Our results of operations for the six months ended June 30, 2024 and 2023 yielded an annualized return on average assets of 1.33% and 1.37% and an annualized return on average stockholders’ equity of 12.04% and 12.69%, respectively.
Current wording
Our results of operations for the three months ended September 30, 2024 and 2023 yielded an annualized return on average assets of 1.29% and 1.30% and an annualized return on average stockholders’ equity of 11.39% and 12.11%, respectively. Our results of operations for the nine months ended September 30, 2024 and 2023 yielded an annualized return on average assets of 1.32% and 1.34% and an annualized return on average stockholders’ equity of 11.81% and 12.48%, respectively.
Previous wording
As of June 30, 2024, we had consolidated total assets of $9.6 billion, total gross loans and leases outstanding of $6.9 billion, total deposits of $7.3 billion, and total stockholders’ equity of $1.0 billion.
Current wording
As of September 30, 2024, we had consolidated total assets of $9.4 billion, total gross loans and leases outstanding of $6.9 billion, total deposits of $7.5 billion, and total stockholders’ equity of $1.1 billion.
Previous wording
(1) Represents a non-GAAP financial measure. See “Reconciliations of non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.
Current wording
(1) Represents a non-GAAP financial measure. See “Reconciliations of non-GAAP Financial Measures” for a reconciliation to the most directly comparable GAAP financial measure.
Previous wording
The increase in net interest income during the three months ended June 30, 2024 was mainly a result of higher yields on loans and leases, organic growth in the loan and lease portfolio, as well as growth in the portfolio as a result of the Inland acquisition. The decrease in non-interest income was mainly due to an increase in the downward revaluation of the loan servicing asset. The increase in non-interest expense was primarily due to increases in salaries and employee benefits mainly due to headcount.
Current wording
The decrease in non-interest expense was primarily due to decreases in data processing expense attributable to the Inland transaction. The increase in non-interest income was mainly due to a decrease in the downward revaluation of the loan servicing asset. The decrease in net interest income was mainly a result of higher rates paid on deposits.
Previous wording
Our annualized return on average assets was 1.31% for the three months ended June 30, 2024 compared to 1.41% for the three months ended June 30, 2023. Our annualized return on average stockholders’ equity was 11.83% for the three months ended June 30, 2024 compared to 12.99% for the three months ended June 30, 2023. Our efficiency ratio was 52.19% for the three months ended June 30, 2024 compared to 52.92% for the three months ended June 30, 2023.
Current wording
Our annualized return on average assets was 1.29% for the three months ended September 30, 2024 compared to 1.30% for the three months ended September 30, 2023. Our annualized return on average stockholders’ equity was 11.39% for the three months ended September 30, 2024 compared to 12.11% for the three months ended September 30, 2023. Our efficiency ratio was 52.02% for the three months ended September 30, 2024 compared to 53.75% for the three months ended September 30, 2023.
Previous wording
We reported consolidated net income of $60.1 million for the six months ended June 30, 2024 compared to net income of $50.1 million for the six months ended June 30, 2023, an increase of $10.1 million. The increase in net income was primarily attributable to a $20.2 million increase in net interest income and decrease of $2.9 million in provision for credit losses, offset by an $8.9 million increase in non-interest expense, and a $3.0 million increase in the provision for income taxes.
Current wording
We reported consolidated net income of $90.4 million for the nine months ended September 30, 2024 compared to net income of $78.3 million for the nine months ended September 30, 2023, an increase of $12.2 million. The increase in net income was primarily attributable to a $15.2 million increase in net interest income and a decrease of $4.3 million in provision for credit losses, offset by an $5.3 million increase in non-interest expense, and a $2.8 million increase in the provision for income taxes. Net income was $2.08 per basic and $2.07 per diluted common share, for the nine months ended September 30, 2024 compared to $2.01 per basic and $1.98 per diluted common share, for the nine months ended September 30, 2023.
Previous wording
The increase in net interest income during the six months ended June 30, 2024 was mainly a result of higher yields on loans and leases and increased average balances. The increase in non-interest expense was mostly due to an increase in salaries and employee benefits.
Current wording
The increase in net interest income during the nine months ended September 30, 2024 was mainly a result of increased average balances and higher yields on loans and leases. The increase in non-interest expense was mostly due to an increase in salaries and employee benefits.
Previous wording
Our annualized return on average assets was 1.33% for the six months ended June 30, 2024 compared to 1.37% for the six months ended June 30, 2023. Our annualized return on average stockholders’ equity was 12.04% for the six months ended June 30, 2024 compared to 12.69% for the six months ended June 30, 2023. Our efficiency ratio was 52.06% for the six months ended June 30, 2024 compared to 52.51% for the six months ended June 30, 2023.
Current wording
Our annualized return on average assets was 1.32% for the nine months ended September 30, 2024 compared to 1.34% for the nine months ended September 30, 2023. Our annualized return on average stockholders’ equity was 11.81% for the nine months ended September 30, 2024 compared to 12.48% for the nine months ended September 30, 2023. Our efficiency ratio was 52.05% for the nine months ended September 30, 2024 compared to 52.96% for the nine months ended September 30, 2023.
Previous wording
We also recognize income from the accretable discounts associated with the purchase of interest-earning assets. Because of our recapitalization and acquisitions, we derive a portion of our interest income from the accretable discounts on purchase credit deteriorated and acquired non-credit-deteriorated loans. The accretion is generally recognized over the life of the loan and is impacted by changes in expected cash flows on the loan. This accretion will continue to have an impact on our net interest income as long as loans acquired with a discount at acquisition represent a meaningful portion of our interest-earning assets. As of June 30, 2024, purchased credit deteriorated loans accounted for under ASC Topic 326 represented 2.5% of our total loan and lease portfolio compared to 3.4% at December 31, 2023.
Current wording
We also recognize income from the accretable discounts associated with the purchase of interest-earning assets. Because of our recapitalization and acquisitions, we derive a portion of our interest income from the accretable discounts on purchase credit deteriorated and acquired non-credit-deteriorated loans. The accretion is generally recognized over the life of the loan. This accretion will continue to have an impact on our net interest income as long as loans acquired with a discount at acquisition represent a meaningful portion of our interest-earning assets. As of September 30, 2024, purchased credit deteriorated loans accounted for under ASC Topic 326 represented 2.1% of our total loan and lease portfolio compared to 3.4% at December 31, 2023.
Previous wording
Net interest income for the three months ended June 30, 2024 was $86.5 million compared to $76.2 million during the same period in 2023, an increase of $10.4 million, or 13.6%. Interest income increased $34.3 million for the three months ended June 30, 2024 compared to the same period in 2023 primarily a result of growth in the loan and lease portfolio, including acquired loans, and higher yields on interest earning assets. Interest expense increased by $23.9 million for the three months ended June 30, 2024 compared to the same period in 2023 mostly due growth of the deposit portfolio, including assumed deposits, change in deposit mix, and higher rates paid on interest-bearing deposits.
Current wording
Net interest income for the three months ended September 30, 2024 was $87.5 million compared to $92.5 million during the same period in 2023, a decrease of $5.0 million, or 5.4%. Interest income increased $9.8 million for the three months ended September 30, 2024 compared to the same period in 2023 primarily a result of growth in the loan and lease portfolio, including acquired loans, and higher yields on interest earning assets. Interest expense increased by $14.8 million for the three months ended September 30, 2024 compared to the same period in 2023 mostly due growth of the deposit portfolio, including assumed deposits, change in deposit mix, and higher rates paid on interest-bearing deposits.
Previous wording
Net interest income for the six months ended June 30, 2024 was $172.1 million compared to $151.9 million during the same period in 2023, an increase of $20.2 million, or 13.3%. Interest income increased $72.6 million for the six months ended June 30, 2024 compared to the same period in 2023 primarily a result of growth in the loan and lease portfolio, including acquired loans, and higher yields on interest earning assets. Interest expense increased by $52.4 million for the six months ended June 30, 2024 compared to the same period in 2023 mostly due growth of the deposit portfolio, including assumed deposits, change in deposit mix, and higher rates paid on interest-bearing deposits.
Current wording
Net interest income for the nine months ended September 30, 2024 was $259.5 million compared to $244.3 million during the same period in 2023, an increase of $15.2 million, or 6.2%. Interest income increased $82.5 million for the nine months ended September 30, 2024 compared to the same period in 2023 primarily a result of growth in the loan and lease portfolio. Interest expense increased by $67.3 million for the nine months ended September 30, 2024 compared to the same period in 2023 mostly due growth of the deposit portfolio, including assumed deposits, change in deposit mix, and higher rates paid on interest-bearing deposits.
Previous wording
Net loan accretion income was $3.7 million for the three months ended June 30, 2024 compared to $611,000 for the three months ended June 30, 2023, an increase of $3.0 million due to loans acquired in the Inland acquisition. Total net loan accretion on acquired loans contributed 17 basis points to the net interest margin for the three months ended June 30, 2024 compared to three basis points for the three months ended June 30, 2023.
Current wording
Net loan accretion income was $3.0 million for the three months ended September 30, 2024 compared to $10.3 million for the three months ended September 30, 2023, a decrease of $7.3 million mainly due to lower accretion on loans acquired in the Inland acquisition. Total net loan accretion on acquired loans contributed 13 basis points to the net interest margin for the three months ended September 30, 2024 compared to 50 basis points for the three months ended September 30, 2023.
Previous wording
Net loan accretion income was $7.9 million for the six months ended June 30, 2024 compared to $1.3 million for the six months ended June 30, 2023, an increase of $6.6 million due to loans acquired in the Inland acquisition. Total net loan accretion on acquired loans contributed 18 basis points to the net interest margin for the six months ended June 30, 2024 compared to four basis points for the six months ended June 30, 2023.
Current wording
Net loan accretion income was $10.9 million for the nine months ended September 30, 2024 compared to $11.6 million for the nine months ended September 30, 2023, a decrease of $694,000 due to lower accretion on loans acquired in the Inland acquisition. Total net loan accretion on acquired loans contributed 17 basis points to the net interest margin for the nine months ended September 30, 2024 compared to 21 basis points for the nine months ended September 30, 2023.
Previous wording
The provision for credit losses was $6.0 million for the three months ended June 30, 2024, compared to $5.8 million for the three months ended June 30, 2023, an increase of $255,000 and is comprised of a provision for credit losses - loans and leases and a provision for credit losses - unfunded commitments. Provision for credit losses - loans and leases was $6.9 million for the three months ended June 30, 2024, and $6.5 million for the three months ended June 30, 2023, an increase of $411,000. The provision for credit losses - unfunded commitments was a recapture of $833,000 and a recapture of $677,000 for the three months ended June 30, 2024 and 2023, respectively.
Current wording
The provision for credit losses was $7.5 million for the three months ended September 30, 2024, compared to $8.8 million for the three months ended September 30, 2023, a decrease of $1.3 million and is comprised of a provision for credit losses - loans and leases and a provision for credit losses - unfunded commitments. Provision for credit losses - loans and leases was $7.6 million for the three months ended September 30, 2024, and $7.9 million for the three months ended September 30, 2023, a decrease of $268,000. On July 1, 2023, a $2.7 million provision for credit losses was recorded on acquired non-credit-deteriorated loans related to the Inland transaction. The provision for credit losses - unfunded commitments was a recapture of $122,000 and a provision of $937,000 for the three months ended September 30, 2024 and 2023, respectively.
Previous wording
The provision for credit losses was $12.7 million for the six months ended June 30, 2024, compared to $15.6 million for the six months ended June 30, 2023, a decrease of $2.9 million. Provision for credit losses - loans and leases was $13.8 million for the six months ended June 30, 2024, and $16.2 million for the six months ended June 30, 2023, a decrease of $2.4 million. The provision for credit losses - unfunded commitments reflects a recapture of $1.1 million and a recapture of $564,000 for the six months ended June 30, 2024 and 2023, respectively.
Current wording
The provision for credit losses was $20.2 million for the nine months ended September 30, 2024, compared to $24.4 million for the nine months ended September 30, 2023, a decrease of $4.3 million. Provision for credit losses - loans and leases was $21.4 million for the nine months ended September 30, 2024, and $24.0 million for the nine months ended September 30, 2023, a decrease of $2.7 million. The provision for credit losses - unfunded commitments reflects a recapture of $1.2 million and a provision of $373,000 for the nine months ended September 30, 2024 and 2023, respectively.
Previous wording
The following table presents the major components of non-interest income for the three and six months ended June 30, 2024 and 2023, respectively (dollars in thousands):
Current wording
The following table presents the major components of non-interest income for the three and nine months ended September 30, 2024 and 2023, respectively (dollars in thousands):
Previous wording
Fees and service charges on deposits represent amounts charged to customers for banking services, such as fees on deposit accounts, and include, but are not limited to, maintenance fees, insufficient fund fees, overdraft protection fees, wire transfer fees, and other charges. Fees and service charges on deposits were $2.5 million and $2.2 million for the three months ended June 30, 2024 and 2023, respectively. Fees and service charges on deposits were $5.0 million and $4.4 million for the six months ended June 30, 2024 and 2023, respectively. The increases were primarily due to increases in deposit balances.
Current wording
Fees and service charges on deposits represent amounts charged to customers for banking services, such as fees on deposit accounts, and include, but are not limited to, maintenance fees, insufficient fund fees, overdraft protection fees, wire transfer fees, and other charges. Fees and service charges on deposits were $2.6 million and $2.4 million for the three months ended September 30, 2024 and 2023, respectively. Fees and service charges on deposits were $7.6 million and $6.7 million for the nine months ended September 30, 2024 and 2023, respectively. The increases were primarily due to increases in deposit balances.
Previous wording
While portions of the loans that we originate are sold and generate gains on sale revenue, servicing rights for the majority of loans that we sell are retained by us. In exchange for continuing to service loans that have been sold, we receive servicing revenue from a portion of the interest cash flow of the loan. We generated $3.2 million and $3.4 million in loan servicing revenue on the sold portion of the U.S. government guaranteed loans for the three months ended June 30, 2024 and 2023, respectively. We generated $6.6 million and $6.8 million in loan servicing revenue on the sold portion of the U.S. government guaranteed loans for the six months ended June 30, 2024 and 2023, respectively. At June 30, 2024 and 2023, the outstanding balance of guaranteed loans serviced was $1.7 billion.
Current wording
While portions of the loans that we originate are sold and generate gains on sale revenue, servicing rights for the majority of loans that we sell are retained by us. In exchange for continuing to service loans that have been sold, we receive servicing revenue from a portion of the interest cash flow of the loan. We generated $3.2 million and $3.4 million in loan servicing revenue on the sold portion of the U.S. government guaranteed loans for the three months ended September 30, 2024 and 2023, respectively. We generated $9.8 million and $10.1 million in loan servicing revenue on the sold portion of the U.S. government guaranteed loans for the nine months ended September 30, 2024 and 2023, respectively. At September 30, 2024 and 2023, the outstanding balance of guaranteed loans serviced was $1.7 billion.
Previous wording
Loan servicing asset revaluation represents net changes in the fair value of our servicing assets. Loan servicing asset revaluation had a downward adjustment of $2.5 million and $865,000 for the three months ended June 30, 2024 and 2023, respectively, a change of $1.6 million. Loan servicing asset revaluation had a downward adjustment of $3.2 million and $209,000 for the six months ended June 30, 2024 and 2023, respectively, a change of $3.0 million. Changes in the revaluation were mainly due to a decline in overall loans serviced balances and higher prepayment speeds.
Current wording
Loan servicing asset revaluation represents net changes in the fair value of our servicing assets. Loan servicing asset revaluation had a downward adjustment of $2.2 million and $3.6 million for the three months ended September 30, 2024 and 2023, respectively, a change of $1.5 million. Change in the quarterly revaluation was mainly due to a decline in the discount rate. Loan servicing asset revaluation had a downward adjustment of $5.4 million and $3.9 million for the nine months ended September 30, 2024 and 2023, respectively, a change of $1.5 million. Change in the year-to-date revaluation was mainly due to a decline in overall loans serviced balances and higher prepayment speeds.
Previous wording
Net gains on sales of loans were $6.0 million for the three months ended June 30, 2024 compared to $5.7 million for the three months ended June 30, 2023, an increase of $332,000, or 5.8%, driven mainly by higher premiums. We sold $72.5 million of U.S. government guaranteed loans during the three months ended June 30, 2024 compared to $72.2 million during the three months ended June 30, 2023. Net gains on sales of loans were $11.6 million for the six months ended June 30, 2024 compared to $10.9 million for the six months ended June 30, 2023, an increase of $717,000 or 6.6%, driven by higher premiums. We sold $146.4 million of U.S. government guaranteed loans during the six months ended June 30, 2024 compared to $158.1 million during the six months ended June 30, 2023.
Current wording
Net gains on sales of loans were $5.9 million for the three months ended September 30, 2024 compared to $6.5 million for the three months ended September 30, 2023, a decrease of $609,000 or 9.4%, driven mainly by lower volume, offset by higher premiums. We sold $79.5 million of U.S. government guaranteed loans during the three months ended September 30, 2024 compared to $101.6 million during the three months ended September 30, 2023. Net gains on sales of loans were $17.4 million for the nine months ended September 30, 2024 compared to $17.3 million for the nine months ended September 30, 2023, an increase of $108,000 or 0.6%, driven by average higher premiums received in the current year, offset by a lower volume of loans sold. We sold $225.9 million of U.S. government guaranteed loans during the nine months ended September 30, 2024 compared to $253.4 million during the nine months ended September 30, 2023.
Previous wording
Wealth management and trust income represents fees charged to customers for investment, trust, or wealth management services and are primarily determined by total assets under administration. Wealth management and trust income was $942,000 for the three months ended June 30, 2024 compared to $1.0 million for the three months ended June 30, 2023, a decrease of $97,000 or 9.3%. Wealth management and trust income was $2.1 million for the six months ended June 30, 2024 compared to $2.0 million for the six months ended June 30, 2023, an increase of $136,000 or 6.9%. Assets under administration were $665.7 million and $636.0 million as of June 30, 2024 and 2023, respectively. Assets under administration decreased $104.8 million or 13.6% from $770.5 million as of December 31, 2023, due to account attrition.
Current wording
Wealth management and trust income represents fees charged to customers for investment, trust, or wealth management services and are primarily determined by total assets under administration. Wealth management and trust income was $1.1 million for the three months ended September 30, 2024 compared to $939,000 for the three months ended September 30, 2023, an increase of $162,000 or 17.2%. Wealth management and trust income was $3.2 million for the nine months ended September 30, 2024 compared to $2.9 million for the nine months ended September 30, 2023, an increase of $298,000 or 10.3%. Assets under administration were $747.7 million and $742.6 million as of September 30, 2024 and 2023, respectively. The increases were primarily driven by higher fees on managed assets and new products and services.
Previous wording
Other non-interest income was $1.8 million for the three months ended June 30, 2024 compared to $1.5 million for the three months ended June 30, 2023, an increase of $299,000 or 20.0%. The increase was primarily driven by income associated with bank owned life insurance. Other non-interest income was $4.0 million for the six months ended June 30, 2024 compared to $3.0 million for the six months ended June 30, 2023, an increase of $1.0 million or 34.1%. The increase was primarily driven by net gains on sales of leased equipment and income associated with bank owned life insurance.
Current wording
Other non-interest income was $2.3 million for the three months ended September 30, 2024 compared to $2.0 million for the three months ended September 30, 2023, an increase of $330,000 or 16.7%. The increase was primarily driven by increased swap fee income. Other non-interest income was $6.3 million for the nine months ended September 30, 2024 compared to $5.0 million for the nine months ended September 30, 2023, an increase of $1.4 million or 27.2%. The increase was primarily driven by net gains on sales of leased equipment, income associated with bank owned life insurance, and increased swap fee income.
Previous wording
The following table presents the major components of non-interest expense for the three and six months ended June 30, 2024 and 2023, respectively (dollars in thousands):
Current wording
The following table presents the major components of non-interest expense for the three and nine months ended September 30, 2024 and 2023, respectively (dollars in thousands):
Previous wording
Salaries and employee benefits, the single largest component of our non-interest expense, totaled $33.9 million for the three months ended June 30, 2024 compared to $29.6 million for the three months ended June 30, 2023, an increase of $4.3 million, or 14.4%. Salaries and employee benefits, totaled $67.9 million for the six months ended June 30, 2024 compared to $60.0 million for the six months ended June 30, 2023, an increase of $7.8 million, or 13.0%. The increases were primarily a result of increased headcount as a result of our acquisition of Inland. Our staffing increased from 987 full-time equivalent employees as of June 30, 2023 to 1,052 as of June 30, 2024.
Current wording
Salaries and employee benefits, the single largest component of our non-interest expense, totaled $35.0 million for each of the three months ended September 30, 2024 and 2023, respectively. Salaries and employee benefits, totaled $102.8 million for the nine months ended September 30, 2024 compared to $95.0 million for the nine months ended September 30, 2023, an increase of $7.8 million, or 8.2%. The increase was primarily a result of merit increases, lower deferred salaries, and higher commissions paid.
Previous wording
Occupancy and equipment expense, net, was $4.6 million for the three months ended June 30, 2024 compared to $4.4 million for the three months ended June 30, 2023, an increase of $235,000 or 5.3%. Occupancy and equipment expense, net, was $9.9 million for the six months ended June 30, 2024 compared to $8.8 million for the six months ended June 30, 2023, an increase of $1.1 million, or 12.1%. The increases were primarily due to branches acquired as a result of the Inland acquisition.
Current wording
Occupancy and equipment expense, net, was $4.4 million for the three months ended September 30, 2024 compared to $5.3 million for the three months ended September 30, 2023, a decrease of $941,000 or 17.7%. The decrease was primarily as a result of lower rent and building maintenance expense. Occupancy and equipment expense, net, was $14.3 million for the nine months ended September 30, 2024 compared to $14.2 million for the nine months ended September 30, 2023, an increase of $134,000 or 0.9%. The increase was primarily due to branches acquired as a result of the Inland acquisition.
Previous wording
Loan and lease related expenses were $741,000 for the three months ended June 30, 2024 compared to $488,000 for the three months ended June 30, 2023, an increase of $253,000, or 51.8%. Loan and lease related expenses were $1.4 million for the six months ended June 30, 2024, compared to $1.5 million for the six months ended June 30, 2023, a decrease of $25,000. The decrease was primarily driven by lower government guaranteed expenses.
Current wording
Loan and lease related expenses were $703,000 for the three months ended September 30, 2024 compared to $836,000 for the three months ended September 30, 2023, a decrease of $133,000, or 15.9%. Loan and lease related expenses were $2.1 million for the nine months ended September 30, 2024, compared to $2.3 million for the nine months ended September 30, 2023, a decrease of $158,000 or 6.9%. The decrease was primarily driven by lower government guaranteed loan expenses.
Previous wording
Legal, audit, and other professional fees were $3.7 million for the three months ended June 30, 2024 compared to $3.7 million for the three months ended June 30, 2023, an increase of $33,000, or 0.9%. Legal, audit, and other professional fees were $6.4 million for the six months ended June 30, 2024 compared to $6.8 million for the six months ended June 30, 2023, a decrease of $362,000 or 5.3%. The decrease was principally driven by merger-related expenses incurred during the first half of 2023.
Current wording
Legal, audit, and other professional fees were $3.6 million for the three months ended September 30, 2024 compared to $3.8 million for the three months ended September 30, 2023, a decrease of $162,000, or 4.3%. Legal, audit, and other professional fees were $10.1 million for the nine months ended September 30, 2024 compared to $10.6 million for the nine months ended September 30, 2023, a decrease of $524,000 or 5.0%. The decreases were principally driven by merger-related expenses incurred during 2023.
Previous wording
Other non-interest expense was $4.9 million for the three months ended June 30, 2024 compared to $5.1 million for the three months ended June 30, 2023, a decrease of $212,000 or 4.2%. This decrease was due to lower general expenses. Other non-interest expense was $10.7 million for the six months ended June 30, 2024, compared to $9.8 million for the six months ended June 30, 2023, an increase of $834,000 or 8.5%. These increases were mostly due to branch consolidation charges taken during the first half of 2024.
Current wording
Other non-interest expense was $5.0 million for the three months ended September 30, 2024 compared to $4.8 million for the three months ended September 30, 2023, an increase of $167,000 or 3.5%. This increase was due to lower gains on sales of assets compared to the same period in the prior year. Other non-interest expense was $15.7 million for the nine months ended September 30, 2024, compared to $14.7 million for the nine months ended September 30, 2023, an increase of $1.0 million or 6.8%. These increases were mostly due to branch consolidation charges taken during the first half of 2024.
Previous wording
Our efficiency ratio was 52.19% for the three months ended June 30, 2024 compared to 52.92% for the three months ended June 30, 2023. The change in our efficiency ratio for the three months ended June 30, 2024 was driven by net interest income growth. Our adjusted efficiency ratio was 52.19% for the three months ended June 30, 2024 compared to 51.39% for the three months ended June 30, 2023. Our efficiency ratio was 52.06% for the six months ended June 30, 2024, compared to 52.51% for the six months ended June 30, 2023. The change in our efficiency ratio was due to higher net interest income. Our adjusted efficiency ratio was 51.97% for the six months ended June 30, 2024, compared to 51.47% for the six months ended June 30, 2023.
Current wording
Our efficiency ratio was 52.02% for the three months ended September 30, 2024 compared to 53.75% for the three months ended September 30, 2023. The change in our efficiency ratio for the three months ended September 30, 2024 was driven by non-interest income growth and decrease in non-interest expense. Our adjusted efficiency ratio was 51.62% for the three months ended September 30, 2024 compared to 47.35% for the three months ended September 30, 2023. Our efficiency ratio was 52.05% for the nine months ended September 30, 2024, compared to 52.96% for the nine months ended September 30, 2023. The change in our efficiency ratio was due to higher net interest income. Our adjusted efficiency ratio was 51.92% for the nine months ended September 30, 2024, compared to 49.96% for the nine months ended September 30, 2023.
Previous wording
Our provision for income taxes for the six months ended June 30, 2024 totaled $20.6 million compared to $17.5 million for the six months ended June 30, 2023, an increase of $3.0 million or 17.4%. The increase in income tax expense was principally due to an increase in net income before provision for income taxes. Our effective tax rate was 25.5% for the six months ended June 30, 2024 and 25.9% for the six months ended June 30, 2023.
Current wording
Our provision for income taxes for the three months ended September 30, 2024 totaled $9.7 million compared to $9.9 million for the three months ended September 30, 2023, a decrease of $202,000, or 2.0%. The decrease in income tax expense was principally due to a higher discrete income tax benefits due to the exercise of stock options and vesting of restricted shares. Our effective tax rate was 24.3% for the three months ended September 30, 2024 and 26.0% for the three months ended September 30, 2023.
Previous wording
Our provision for income taxes for the three months ended June 30, 2024 totaled $10.4 million compared to $9.2 million for the three months ended June 30, 2023, an increase of $1.2 million, or 13.1%. The increase in income tax expense was principally due to an increase in net income before provision for income taxes. Our effective tax rate was 26.0% for the three months ended June 30, 2024 and 26.1% for the three months ended June 30, 2023.
Current wording
Our provision for income taxes for the nine months ended September 30, 2024 totaled $30.3 million compared to $27.4 million for the nine months ended September 30, 2023, an increase of $2.8 million or 10.3%. The increase in income tax expense was principally due to an increase in net income before provision for income taxes. Our effective tax rate was 25.1% for the nine months ended September 30, 2024 and 26.0% for the nine months ended September 30, 2023.
Previous wording
Our total assets increased by $751.8 million, or 8.5%, to $9.6 billion at June 30, 2024 compared to $8.9 billion at December 31, 2023. The increase in total assets was primarily due to an increase in cash and cash equivalents of $504.3 million, inclusive of $200.0 million in short term investments, and an increase of $206.9 million in loans and leases, or 3.1%, from $6.7 billion at December 31, 2023 to $6.9 billion at June 30, 2024. Our originated loan and lease portfolio increased by $308.8 million and our purchased credit deteriorated loans and acquired non-credit-deteriorated loans and leases portfolio decreased by $101.9 million. The increase in our originated portfolio was primarily attributed to growth in the commercial and industrial portfolio. The decrease in our purchased credit deteriorated loans and acquired non-credit-deteriorated loans and leases portfolio was attributed to decreases in commercial and residential real estate resulting from resolutions and charge-offs.
Current wording
Our total assets increased by $542.3 million, or 6.1%, to $9.4 billion at September 30, 2024 compared to $8.9 billion at December 31, 2023. The increase in total assets was primarily due to an increase in cash and cash equivalents of $226.5 million, or 100.1%, an increase in securities available for sale of $159.6 million, or 11.9%, and an increase of $195.1 million in loans and leases, or 2.9%, from $6.7 billion at December 31, 2023 to $6.9 billion at September 30, 2024. Our originated loan and lease portfolio increased by $377.0 million and our purchased credit deteriorated loans and acquired non-credit-deteriorated loans and leases portfolio decreased by $181.8 million. The increase in our originated portfolio was primarily attributed to growth in the commercial and industrial and commercial real estate portfolios. The decrease in our purchased credit deteriorated loans and acquired non-credit-deteriorated loans and leases portfolio was attributed to decreases in commercial and residential real estate resulting from resolutions and charge-offs.
Previous wording
Total liabilities increased by $709.0 million, or 9.0%, to $8.6 billion at June 30, 2024 compared to $7.9 billion at December 31, 2023. Total deposits increased by $170.2 million, or 2.4%, driven by growth in time deposits and interest bearing checking accounts. Other borrowings increased by $523.5 million, or 132.5%, mainly due to advances under the BTFP of $200.0 million and increased FHLB advances.
Current wording
Total liabilities increased by $436.2 million, or 5.5%, to $8.3 billion at September 30, 2024 compared to $7.9 billion at December 31, 2023. Total deposits increased by $320.9 million, or 4.5%, driven by growth in time deposits, interest bearing checking accounts, and money market accounts, offset by decreases to non-interest bearing deposits. Other borrowings increased by $123.6 million, or 31.3%, mainly due to increased FHLB advances.
Previous wording
Securities available-for-sale increased by $44.3 million, or 3.3%, from $1.3 billion at December 31, 2023 to $1.4 billion at June 30, 2024. The increase was mainly attributed to purchases of securities, net of maturities, calls, and repayments.
Current wording
Securities available-for-sale increased by $159.6 million, or 11.9%, from $1.3 billion at December 31, 2023 to $1.5 billion at September 30, 2024. The increase was primarily attributed to purchases of securities, net of maturities, calls, and repayments coupled with a decrease in unrealized losses as a result of the current interest rate environment.
Previous wording
At June 30, 2024, our held-to-maturity securities portfolio consists of obligations of states, municipalities and political subdivisions. We carry these securities at amortized cost. Securities held-to-maturity were $606,000 at June 30, 2024, and $1.2 million at December 31, 2023, respectively.
Current wording
At September 30, 2024, our held-to-maturity securities portfolio consists of obligations of states, municipalities and political subdivisions. We carry these securities at amortized cost. Securities held-to-maturity were $605,000 at September 30, 2024, and $1.2 million at December 31, 2023, respectively.
Previous wording
Certain securities have fair values less than amortized cost and, therefore, contain unrealized losses. At June 30, 2024, we evaluated the securities that had an unrealized loss for credit losses and determined there were none. There were 339 investment securities with unrealized losses at June 30, 2024. We anticipate full recovery of amortized cost with respect to these securities by maturity, or sooner in the event of a more favorable market interest rate environment. We do not intend to sell these securities and it is not more likely than not that we will be required to sell them before recovery of their amortized cost basis, which may be at maturity.
Current wording
Certain securities have fair values less than amortized cost and, therefore, contain unrealized losses. At September 30, 2024, we evaluated the securities that had an unrealized loss for credit losses and determined there were none. There were 268 investment securities with unrealized losses at September 30, 2024. We anticipate full recovery of amortized cost with respect to these securities by maturity, or sooner in the event of a more favorable market interest rate environment. We do not intend to sell these securities and it is not more likely than not that we will be required to sell them before recovery of their amortized cost basis, which may be at maturity.
Previous wording
Total non-taxable securities classified as obligations of states, municipalities and political subdivisions were $53.5 million at June 30, 2024, a decrease of $2.2 million from December 31, 2023.
Current wording
Total non-taxable securities classified as obligations of states, municipalities and political subdivisions were $53.4 million at September 30, 2024, a decrease of $2.3 million from December 31, 2023.
Previous wording
As a member of the Federal Home Loan Bank system, Byline Bank is required to maintain an investment in the capital stock of the FHLB. No market exists for this stock, and it has no quoted market value. The stock is redeemable at par by the FHLB and is, therefore, carried at cost. In addition, Byline Bank owns stock of Bankers’ Bank that was acquired as part of a bank acquisition. The stock is redeemable at par and carried at cost. As of June 30, 2024 and December 31, 2023, we held $31.8 million and $16.3 million, respectively, in FHLB and Bankers’ Bank stock. We evaluate impairment of our investment in FHLB and Bankers’ Bank based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value. We did not identify any indicators of impairment of FHLB and Bankers’ Bank stock as of June 30, 2024 and December 31, 2023.
Current wording
As a member of the Federal Home Loan Bank system, Byline Bank is required to maintain an investment in the capital stock of the FHLB. No market exists for this stock, and it has no quoted market value. The stock is redeemable at par by the FHLB and is, therefore, carried at cost. In addition, Byline Bank owns stock of Bankers’ Bank that was acquired as part of a bank acquisition. The stock is redeemable at par and carried at cost. As of September 30, 2024 and December 31, 2023, we held $22.7 million and $16.3 million, respectively, in FHLB and Bankers’ Bank stock. We evaluate impairment of our investment in FHLB and Bankers’ Bank based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value. We did not identify any indicators of impairment of FHLB and Bankers’ Bank stock as of September 30, 2024 and December 31, 2023.
Showing the first 40 of 66 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
“Adjusted pre-tax pre-provision return on average assets” excludes certain significant items, which include impairment charges on assets held for sale and right-of-use assets, and merger-related expenses.