QCR HOLDINGS INC
For the period ended Mar 31, 2024. Filed May 9, 2024.
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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.
Mar 31, 2024 · Filed May 9, 2024
Extracted filing text, with the paragraph anchors used by the comparison.
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Executive Overview
The Company reported net income of $26.7 million and diluted EPS of $1.58 for the quarter ended March 31, 2024. By comparison, for the quarter ended December 31, 2023, the Company reported net income of $32.9 million and diluted EPS of $1.95. For the quarter ended March 31, 2023, the Company reported net income of $27.2 million, and diluted EPS of $1.60.
The first quarter of 2024 was also highlighted by the following results and events:
| ● | Capital markets revenue of $16.5 million; |
| ● | Annualized core deposit growth, excluding brokered deposits, of 20.3%; |
| ● | Increase in tangible book value (non-GAAP) per share of $1.12, or 10.2% annualized; and |
| ● | TCE/TA ratio (non-GAAP) improved 19 basis points to 8.94%. |
Following is a table that represents various net income measurements for the Company.
| | | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| · · For the three months ended · · | |||||||||||
| · March 31, 2024 · December 31, 2023 · March 31, 2023 · | |||||||||||
| · · (dollars in thousands) · · | |||||||||||
| | | | | | | | | | | | |
| Net income | | $26,726 | | $32,855 | | $27,157 | | | |||
| | | | | | | | | | | | |
| Diluted earnings per common share | | $1.58 | | $1.95 | | $1.60 | | | |||
| | | | | | | | | | | | |
| Weighted average common and common equivalent shares outstanding | | 16,910,675 | | 16,875,952 | | 16,942,132 | | | |||
The Company reported adjusted net income (non-GAAP) of $26.9 million, with adjusted diluted EPS of $1.59 for the three months ended March 31, 2024. See section titled “GAAP to Non-GAAP Reconciliations” for additional information. Adjusted net income for the three months ended March 31, 2024 excludes a number of non-recurring items, after-tax, as set forth in the GAAP to Non-GAAP Reconciliation section.
Following is a table that represents the major income and expense categories for the Company:
| | | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| · · For the three months ended · · | |||||||||||
| · March 31, 2024 · December 31, 2023 · March 31, 2023 | |||||||||||
| · · (dollars in thousands) · · | |||||||||||
| | | | | | | | | | | | |
| Net interest income | | $54,699 | | $55,736 | | $56,810 | | | |||
| Provision for credit losses | | 2,969 | | 5,199 | | 3,928 | | | |||
| Noninterest income | | 26,858 | | 47,729 | | 25,842 | | | |||
| Noninterest expense | | 50,690 | | 60,938 | | 48,785 | | | |||
| Federal and state income tax expense | | 1,172 | | 4,473 | | 2,782 | | | |||
| Net income | | $26,726 | | $32,855 | | $27,157 | | | |||
| | | | | | | | | | | | |
Following are some noteworthy changes in the Company's financial results:
| ● | Net interest income in the first quarter of 2024 decreased 2% compared to the fourth quarter of 2023 and decreased 4% when compared to the first quarter of 2023. Several non-client factors drove this decrease, including the maturity of $125 million of interest rate caps on the Company’s indexed deposits and the conversion of $65 million of subordinated debt to a higher floating rate, which contributed a combined $1.3 million of additional interest expense. In addition, loan discount accretion decreased by $310 thousand and there was one less day in the quarter which had an impact of approximately $600 thousand decrease in net interest income. |
| ● | Provision expense in the first quarter of 2024 decreased $2.2 million as compared to the fourth quarter of 2023 and decreased $959 thousand when compared to the first quarter of 2023. The decrease was due to a lower provision for OBS as there was a decrease in the balance of unfunded commitments from a surge in commitments in the LIHTC lending business at December 31, 2023 that began funding during the first quarter of 2024. In |
Part I
Item 2
addition, there was negative provision of $445 thousand on AFS securities for the first quarter of 2024 related to the sale of a debt investment in a failed bank. See the “Provision for Credit Losses” section of this report for additional details.
| ● | Noninterest income in the first quarter of 2024 decreased $20.9 million, or 44%, compared to the fourth quarter of 2023. The decrease was primarily due to lower capital markets revenue from swap fees in the first quarter as compared to the outsized performance of $37.0 million in the fourth quarter. Noninterest income increased $1.0 million, or 4%, compared to the first quarter of 2023. The increase was primarily due to higher capital markets revenue from swap fees as strong demand for affordable housing established by our tax credit lending clients has continued. The demand for low-income housing remains healthy and the economics associated with these tax credit projects continue to be favorable. The Company has a strong pipeline for this business and expects it to continue to be a solid source of fee income in 2024. |
| ● | Noninterest expense decreased $10.2 million, or 17%, in the first quarter of 2024 compared to the fourth quarter of 2023. This decrease was primarily due to lower variable employee compensation due to lower capital markets revenue from swap fees in the first quarter as compared to the fourth quarter of 2023. Noninterest expense increased $1.9 million, or 4%, compared to the first quarter of 2023. The increase was primarily due to higher costs associated with IT service agreements, an increase in data processing fees and higher FDIC insurance assessments with the growth in assets. |
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.