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Eagle Bancorp, Inc. Announces Its 31st Consecutive Quarter of Record Earnings With Third Quarter 2016 Net Income Up 14% Over 2015

Company Release - 10/19/2016 4:15 PM ET

BETHESDA, Md., Oct. 19, 2016 (GLOBE NEWSWIRE) -- Eagle Bancorp, Inc. (the “Company”) (NASDAQ:EGBN), the parent company of EagleBank, today announced record quarterly net income of $24.5 million for the three months ended September 30, 2016, a 14% increase over the $21.5 million net income for the three months ended September 30, 2015. Net income available to common shareholders for the three months ended September 30, 2016 increased 15% to $24.5 million as compared to $21.3 million for the same period in 2015.

Eagle Bancorp, Inc. Logo


Net income per basic common share for the three months ended September 30, 2016 was $0.73 compared to $0.64 for the same period in 2015, a 14% increase. Net income per diluted common share for the three months ended September 30, 2016 was $0.72 compared to $0.63 for the same period in 2015, a 14% increase.

For the nine months ended September 30, 2016, the Company’s net income was $72.0 million, a 17% increase over the $61.8 million for the nine months ended September 30, 2015. Net income available to common shareholders was $72.0 million ($2.14 per basic common share and $2.11 per diluted common share), as compared to $61.3 million ($1.88 per basic common share and $1.84 per diluted common share) for the same nine month period in 2015, a 14% increase per basic share and a 15% increase per diluted share.

“We are very pleased to report a continued quarterly trend of balanced and consistently strong financial performance,” noted Ronald D. Paul, Chairman and Chief Executive Officer of Eagle Bancorp, Inc. “Our net income has increased for 31 consecutive quarters dating back to the first quarter of 2009.  This strong financial performance has resulted from a combination of balance sheet growth, revenue growth, solid asset quality, and favorable operating leverage.” Mr. Paul added, “A lower level of net loan growth in the third quarter was due substantially to higher loan payoffs while loan originations and pipeline commitments remain very strong. Additionally, our regulatory capital levels were enhanced in July 2016 from an already well capitalized position as we completed the sale of $150 million in subordinated debt by our holding company. This raise, together with the strong quarter in deposit growth, served to both increase liquidity in the quarter and suppress earning asset yields. We estimate a 15 basis point negative impact on the net interest margin for the third quarter 2016 due to the $150 million sub-debt raise.” The raise was accomplished at a favorable cost of capital and will be deployed over time into higher yielding assets.          

The Company’s financial performance in the third quarter of 2016 as compared to 2015 was highlighted by growth in total loans of 1.5% for the third quarter 2016 over 2015 and 15% over the nine month period ended September 30, 2016 versus the prior year; by growth in total deposits of 4% for the quarter and 13% over the prior year; and by 9% growth in total revenue for the quarter and 10% over the prior year. For the third quarter in 2016, the efficiency ratio was 40.54%. Mr. Paul added, “at a time when the net interest margin of banks is being challenged by the continuing low interest rate environment, the Company remains committed to cost management measures and strong productivity. Noninterest expenses increased 5% in the third quarter 2016 over 2015 and increased 4% for the nine months ended September 30, 2016 over the prior year. The annualized return on average assets (“ROAA”) was 1.50% for the third quarter in 2016 and 1.54% for the nine months ended September 30, 2016. The annualized return on average common equity (“ROACE”) was 12.04% for the third quarter in 2016 and 12.27% for the nine months ended September 30, 2016.

Loan growth for the first nine months of 2016 was 10% and averaged 17% higher as compared to the first nine months of 2015. Deposit growth was 8% for the first nine months of 2016 and averaged 13% higher for the first nine months of 2016 compared with the first nine months of 2015.

The net interest margin was 4.11% for the third quarter of 2016, as compared to 4.23% for the third quarter of 2015. As noted above, the sub-debt raise negatively impacted the net interest margin in the third quarter of 2016 by 15 basis points. For the nine month period ended September 30, 2016, the net interest margin was 4.23% as compared to 4.32% for the nine months ended September 30, 2015. The sub-debt raise in July 2016 negatively impacted the net interest margin in the nine month period ending September 30, 2016 by six basis points. Mr. Paul noted, “the persistently low interest rate environment has continued to challenge bank spread earnings. In the current environment, the Company has continued its emphasis on disciplined pricing for both new loans and funding sources, which has resulted in the Company maintaining a superior net interest margin.”

Asset quality measures remained solid at September 30, 2016. Net charge-offs (annualized) were 0.14% of average loans for the third quarter of 2016, as compared to 0.16% of average loans for the third quarter of 2015. At September 30, 2016, the Company’s nonperforming loans amounted to $22.3 million (0.41% of total loans) as compared to $14.5 million (0.30% of total loans) at September 30, 2015 and $13.2 million (0.26% of total loans) at December 31, 2015. Nonperforming assets amounted to $27.5 million (0.41% of total assets) at September 30, 2016 compared to $24.4 million (0.41% of total assets) at September 30, 2015 and $19.1 million (0.31% of total assets) at December 31, 2015.

Management continues to remain attentive to any signs of deterioration in borrowers’ financial conditions and is proactive in taking the appropriate steps to mitigate risk. Furthermore, the Company is diligent in placing loans on nonaccrual status and believes, based on its loan portfolio risk analysis, that its September 30, 2016 allowance for credit losses, at 1.04% of total loans (excluding loans held for sale), is adequate to absorb potential credit losses within the loan portfolio as of the end of the quarter. The allowance for credit losses was 1.05% of total loans at both September 30, 2015 and December 31, 2015. The allowance for credit losses represented 255% of nonperforming loans at September 30, 2016.

“Total assets at September 30, 2016 were $6.76 billion, a 15% increase as compared to $5.89 billion at September 30, 2015, and an 11% increase as compared to $6.08 billion at December 31, 2015. Total loans (excluding loans held for sale) were $5.48 billion at September 30, 2016, a 15% increase as compared to $4.78 billion at September 30, 2015, and a 10% increase as compared to $5.00 billion at December 31, 2015. Loans held for sale amounted to $78.1 million at September 30, 2016 as compared to $35.7 million at September 30, 2015, a 119% increase, and $47.5 million at December 31, 2015, a 65% increase. The investment portfolio totaled $430.7 million at September 30, 2016, an 18% decrease from the $524.3 million balance at September 30, 2015. As compared to December 31, 2015, the investment portfolio at September 30, 2016 decreased by $57.2 million or 12%.

Total deposits at September 30, 2016 were $5.56 billion, compared to deposits of $4.93 billion at September 30, 2015, a 13% increase, and deposits of $5.16 billion at December 31, 2015, an 8% increase. Total borrowed funds (excluding customer repurchase agreements) were $266.4 million at September 30, 2016, $68.9 million at September 30, 2015 and $68.9 million at December 31, 2015.

Total shareholders’ equity at September 30, 2016 increased 4%, to $815.6 million, compared to $786.1 million at September 30, 2015, and increased 10%, from $738.6 million at December 31, 2015. The smaller increase in shareholders’ equity at September 30, 2016 compared to the same period in 2015 reflects increased retained earnings offset by the redemption during the fourth quarter of 2015 of all $71.9 million of the preferred stock issued under the Small Business Lending Fund ("SBLF"). The $150 million of qualifying capital raised in a ten year sub-debt issue in July 2016 enhanced the Company’s capital position well in excess of regulatory requirements for well capitalized status. The total risk based capital ratio was 15.05% at September 30, 2016, as compared to 13.80% at September 30, 2015, and 12.75% at December 31, 2015. In addition, the tangible common equity ratio was 10.64% at September 30, 2016, compared to 10.46% at September 30, 2015 and 10.56% at December 31, 2015.

Analysis of the three months ended September 30, 2016 compared to September 30, 2015

For the three months ended September 30, 2016, the Company reported an annualized ROAA of 1.50% as compared to 1.47% for the three months ended September 30, 2015. The annualized ROACE for the three months ended September 30, 2016 was 12.04%, as compared to 11.95% for the three months ended September 30, 2015. The higher ratios are due to higher earnings.

Total revenue (net interest income plus noninterest income) for the third quarter of 2016 was $71.1 million, or 9% above the $65.2 million of total revenue earned for the third quarter of 2015 and was only slightly less than the $71.4 million of revenue earned in the second quarter of 2016.

Net interest income increased 10% for the three months ended September 30, 2016 over the same period in 2015 ($64.7 million versus $59.1 million), resulting from growth in average earning assets of 13%. The net interest margin was 4.11% for the three months ended September 30, 2016, as compared to 4.23% for the three months ended September 30, 2015. The Company believes its net interest margin remains favorable compared to peer banking companies and that its disciplined approach to managing the loan portfolio yield to 5.08% for the third quarter in 2016 has been a significant factor in its overall profitability.

The provision for credit losses was $2.3 million for the three months ended September 30, 2016 as compared to $3.3 million for the three months ended September 30, 2015. The lower provisioning in the third quarter of 2016, as compared to the third quarter of 2015, is primarily due to lower loan growth, as loan growth of $78.5 million in the three months ended September 30, 2016 was lower than loan growth of $226.1 million in the same period in 2015, and to overall improved asset quality. Net charge-offs of $2.0 million in the third quarter of 2016 represented an annualized 0.14% of average loans, excluding loans held for sale, as compared to $1.9 million, or an annualized 0.16% of average loans, excluding loans held for sale, in the third quarter of 2015. Net charge-offs in the third quarter of 2016 were attributable primarily to investment-commercial real estate loans ($1.7 million).

Noninterest income for the three months ended September 30, 2016 increased to $6.4 million from $6.1 million for the three months ended September 30, 2015, a 5% increase. This increase was primarily due to higher net gains on sales of residential mortgage loans of $532 thousand. Residential mortgage loans closed were $276 million for the third quarter in 2016 versus $175 million for the third quarter of 2015.   

The efficiency ratio, which measures the ratio of noninterest expense to total revenue, was 40.54% for the third quarter of 2016, as compared to 42.04% for the third quarter of 2015. Noninterest expenses totaled $28.8 million for the three months ended September 30, 2016, as compared to $27.4 million for the three months ended September 30, 2015, a 5% increase. Cost increases for salaries and benefits were $1.7 million, due primarily to increased staff, merit increases and incentive compensation. Premises and equipment expenses were $188 thousand lower, due primarily to the closing of one branch office acquired in the merger, and transactions to reduce space in two additional offices. Marketing and advertising expense increased by $95 thousand primarily due to costs associated with digital and print advertising and sponsorships. Legal, accounting and professional fees decreased by $292 thousand primarily due to lower legal fees. FDIC insurance premium expense decreased by $165 thousand resulting from lower growth in total assets. Other expenses increased by $335 thousand primarily due to higher fees incurred to maintain OREO properties.

Analysis of the nine months ended September 30, 2016 compared to September 30, 2015

For the nine months ended September 30, 2016, the Company reported an annualized ROAA of 1.54% as compared to 1.49% for the nine months ended September 30, 2015. The annualized ROACE for the nine months ended September 30, 2016 was 12.27%, as compared to 12.41% for the nine months ended September 30, 2015, the lower ROACE due to the higher average capital position.

For the nine month periods ending September 30, total revenue was $211.4 million for 2016, as compared to $191.5 million in 2015, a 10% increase.  

Net interest income increased 12% for the nine months ended September 30, 2016 over the same period in 2015 ($191.1 million versus $171.4 million), resulting from growth in average earning assets of 14%. The net interest margin was 4.23% for the nine months ended September 30, 2016 as compared to 4.32% for the same period in 2015. The Company believes its net interest margin remains favorable compared to peer banking companies and that its disciplined approach to managing the loan portfolio yield to 5.10% for the first nine months in 2016 has been a significant factor in its overall profitability.

The provision for credit losses was $9.2 million for the nine months ended September 30, 2016 as compared to $10.0 million for the nine months ended September 30, 2015. The slightly lower provisioning in the first nine months of 2016, as compared to the first nine months of 2015, is due to lower charge-offs and to overall improved asset quality. Net charge-offs of $5.0 million in the first nine months of 2016 represented an annualized 0.13% of average loans, excluding loans held for sale, as compared to $5.8 million or an annualized 0.17% of average loans, excluding loans held for sale, in the first nine months of 2015. Net charge-offs in the first nine months of 2016 were attributable primarily to commercial ($2.7 million), investment-commercial real estate ($2.3 million), and consumer loans ($220 thousand) offset by a recovery of $207 thousand in construction-commercial and residential loans.

Noninterest income for the nine months ended September 30, 2016 was $20.3 million as compared to $20.1 million for the nine months ended September 30, 2015, a 1% increase. This increase was primarily due to an increase of $717 thousand in gains on SBA loan sales, a $712 thousand increase in other income, and an increase of $313 thousand in service charges on deposits offset by a decline of $2.0 million in gains on the sale of residential mortgage loans due to lower origination and sales volume. Residential mortgage loans closed were $622 million for the first nine months of 2016 versus $723 million for the first nine months of 2015.

Noninterest expenses totaled $85.2 million for the nine months ended September 30, 2016, as compared to $82.1 million for the nine months ended September 30, 2015, a 4% increase. Cost increases for salaries and benefits were $3.4 million, due primarily to increased staff, merit increases, and incentive compensation. Premises and equipment expenses were $637 thousand lower, primarily due to the closing of one branch acquired in the merger and to sublease arrangements. Marketing and advertising expense increased by $369 thousand primarily due to costs associated with digital and print advertising and sponsorships. Legal, accounting and professional fees decreased by $70 thousand primarily due to lower professional fees. Data processing expense increased $118 thousand primarily due to licensing agreements. FDIC insurance premium expense decreased by $155 thousand resulting from lower growth in total assets. For the first nine months of 2016, the efficiency ratio was 40.32% as compared to 42.86% for the same period in 2015.

The financial information which follows provides more detail on the Company’s financial performance for the nine and three months ended September 30, 2016 as compared to the nine and three months ended September 30, 2015 as well as providing eight quarters of trend data. Persons wishing additional information should refer to the Company’s Form 10-K for the year ended December 31, 2015 and other reports filed with the Securities and Exchange Commission (the “SEC”).

About Eagle Bancorp: The Company is the holding company for EagleBank, which commenced operations in 1998. The Bank is headquartered in Bethesda, Maryland, and operates through twenty-one branch offices, located in Montgomery County, Maryland, Washington, D.C. and Northern Virginia. The Company focuses on building relationships with businesses, professionals and individuals in its marketplace.

Conference Call: Eagle Bancorp will host a conference call to discuss its third quarter 2016 financial results on Thursday, October 20, 2016 at 10:00 a.m. eastern daylight time. The public is invited to listen to this conference call by dialing 1.877.303.6220, conference ID Code is 93565935, or by accessing the call on the Company’s website, www.EagleBankCorp.com. A replay of the conference call will be available on the Company’s website through November 3, 2016.

Forward-looking Statements: This press release contains forward-looking statements within the meaning of the Securities and Exchange Act of 1934, as amended, including statements of goals, intentions, and expectations as to future trends, plans, events or results of Company operations and policies and regarding general economic conditions. In some cases, forward-looking statements can be identified by use of words such as “may,” “will,” “anticipates,” “believes,” “expects,” “plans,” “estimates,” “potential,” “continue,” “should,” and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company’s market, interest rates and interest rate policy, competitive factors, and other conditions which by their nature, are not susceptible to accurate forecast and are subject to significant uncertainty. Because of these uncertainties and the assumptions on which this discussion and the forward-looking statements are based, actual future operations and results in the future may differ materially from those indicated herein. For details on factors that could affect these expectations, see the risk factors and other cautionary language included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 and in other periodic and current reports filed with the SEC. Readers are cautioned against placing undue reliance on any such forward-looking statements. The Company’s past results are not necessarily indicative of future performance.

         
Eagle Bancorp, Inc.        
Consolidated Financial Highlights (Unaudited)        
(dollars in thousands, except per share data)    
 Nine Months Ended September 30, Three Months Ended September 30, 
  2016   2015   2016   2015  
Income Statements:        
Total interest income$  210,010  $  185,869  $  72,431  $  63,981  
Total interest expense   18,870     14,503     7,703     4,896  
Net interest income   191,140     171,366     64,728     59,085  
Provision for credit losses   9,219     10,043     2,288     3,262  
Net interest income after provision for credit losses   181,921     161,323     62,440     55,823  
Noninterest income (before investment gains
and extinguishment of debt)
   19,147     19,042     6,404     6,039  
Gain on sale of investment securities   1,123     2,224     1     60  
Loss on early extinguishment of debt   -      (1,130)    -      -   
Total noninterest income   20,270     20,136     6,405     6,099  
Total noninterest expense    85,235     82,076     28,838     27,405  
Income before income tax expense   116,956     99,383     40,007     34,517  
Income tax expense   44,966     37,564     15,484     13,054  
Net income   71,990     61,819     24,523     21,463  
Preferred stock dividends    -      539     -      180  
Net income available to common shareholders$  71,990  $  61,280  $  24,523  $  21,283  
         
Per Share Data:        
Earnings per weighted average common share, basic$  2.14  $  1.88  $  0.73  $  0.64  
Earnings per weighted average common share, diluted$  2.11  $  1.84  $  0.72  $  0.63  
Weighted average common shares outstanding, basic    33,565,863     32,625,379     33,590,183     33,400,973  
Weighted average common shares outstanding, diluted    34,161,890     33,277,542     34,187,171     34,026,412  
Actual shares outstanding at period end   33,590,880     33,405,510     33,590,880     33,405,510  
Book value per common share at period end $  24.28  $  21.38  $  24.28  $  21.38  
Tangible book value per common share at period end (1)$  21.08  $  18.10  $  21.08  $  18.10  
         
Performance Ratios (annualized):        
Return on average assets 1.54%  1.49%  1.50%  1.47% 
Return on average common equity 12.27%  12.41%  12.04%  11.95% 
Net interest margin 4.23%  4.32%  4.11%  4.23% 
Efficiency ratio (2) 40.32%  42.86%  40.54%  42.04% 
         
Other Ratios:        
Allowance for credit losses to total loans (3) 1.04%  1.05%  1.04%  1.05% 
Allowance for credit losses to total nonperforming loans 255.29%  347.82%  255.29%  347.82% 
Nonperforming loans to total loans (3) 0.41%  0.30%  0.41%  0.30% 
Nonperforming assets to total assets 0.41%  0.41%  0.41%  0.41% 
Net charge-offs (annualized) to average loans (3) 0.13%  0.17%  0.14%  0.16% 
Common equity to total assets 12.06%  12.13%  12.06%  12.13% 
Tier 1 capital (to average assets) 11.12%  11.96%  11.12%  11.96% 
Total capital (to risk weighted assets) 15.05%  13.80%  15.05%  13.80% 
Common equity tier 1 capital (to risk weighted assets) 10.83%  10.48%  10.83%  10.48% 
Tangible common equity ratio (1) 10.64%  10.46%  10.64%  10.46% 
         
Loan Balances - Period End (in thousands):        
Commercial and Industrial$  1,130,042  $  1,007,659  $  1,130,042  $  1,007,659  
Commercial real estate - owner occupied $  590,427  $  489,657  $  590,427  $  489,657  
Commercial real estate - income producing $  2,551,186  $  2,022,950  $  2,551,186  $  2,022,950  
1-4 Family mortgage$  154,439  $  147,720  $  154,439  $  147,720  
Construction - commercial and residential$  838,137  $  927,265  $  838,137  $  927,265  
Construction - C&I (owner occupied)$  104,676  $  60,487  $  104,676  $  60,487  
Home equity$  106,856  $  115,346  $  106,856  $  115,346  
Other consumer $  6,212  $  5,881  $  6,212  $  5,881  
         
Average Balances (in thousands):        
Total assets$  6,252,867  $  5,537,401  $  6,492,274  $  5,775,283  
Total earning assets$  6,026,357  $  5,307,848  $  6,264,531  $  5,545,398  
Total loans$  5,253,742  $  4,505,092  $  5,422,677  $  4,636,298  
Total deposits$  5,225,804  $  4,611,324  $  5,353,834  $  4,842,706  
Total borrowings$  215,851  $  167,926  $  300,083  $  128,015  
Total shareholders’ equity$  783,499  $  732,156  $  809,973  $  778,279  
         

(1) Tangible common equity to tangible assets (the "tangible common equity ratio") and tangible book value per common share are non-GAAP financial measures derived from GAAP based amounts. The Company calculates the tangible common equity ratio by excluding the balance of intangible assets from common shareholders' equity and dividing by tangible assets. The Company calculates tangible book value per common share by dividing tangible common equity by common shares outstanding, as compared to book value per common share, which the Company calculates by dividing common shareholders' equity by common shares outstanding. The Company considers this information important to shareholders as tangible equity is a measure that is consistent with the calculation of capital for bank regulatory purposes, which excludes intangible assets from the calculation of risk based ratios and as such is useful for investors, regulators, management and others to evaluate capital adequacy and to compare against other financial institutions. The table below provides a reconciliation of these non-GAAP financial measures with financial measures defined by GAAP.

      
GAAP Reconciliation (Unaudited)     
(dollars in thousands except per share data)     
 Nine Months Ended Twelve Months Ended Nine Months Ended
 September 30, 2016 December 31, 2015 September 30, 2015
Common shareholders' equity$  815,639  $  738,601  $  714,169 
Less: Intangible assets   (107,694)    (108,542)    (109,498)
Tangible common equity$  707,945  $  630,059  $  604,671 
      
Book value per common share$  24.28  $  22.07  $  21.38 
Less: Intangible book value per common share   (3.20)    (3.24)    (3.28)
Tangible book value per common share$  21.08  $  18.83  $  18.10 
      
Total assets$  6,762,132  $  6,075,577  (4)$  5,887,855 
Less: Intangible assets   (107,694)    (108,542)    (109,498)
Tangible assets$  6,654,438  $  5,967,035  $  5,778,357 
Tangible common equity ratio 10.64%  10.56%  10.46%
      

(2) Computed by dividing noninterest expense by the sum of net interest income and noninterest income.

(3) Excludes loans held for sale.

(4) As adjusted for debt issuance cost reclassification.

      
Eagle Bancorp, Inc.     
Consolidated Balance Sheets (Unaudited)     
(dollars in thousands, except per share data)     
      
AssetsSeptember 30, 2016 December 31, 2015 September 30, 2015
Cash and due from banks$  10,615  $  10,270  $  10,080 
Federal funds sold   5,262     3,791     4,076 
Interest bearing deposits with banks and other short-term investments   503,150     284,302     291,898 
Investment securities available for sale, at fair value   430,668     487,869     524,326 
Federal Reserve and Federal Home Loan Bank stock   19,920     16,903     16,865 
Loans held for sale   78,118     47,492     35,713 
Loans    5,481,975     4,998,368     4,776,965 
Less allowance for credit losses   (56,864)    (52,687)    (50,320)
Loans, net   5,425,111     4,945,681     4,726,645 
Premises and equipment, net   19,370     18,254     17,070 
Deferred income taxes   41,065     40,311     35,426 
Bank owned life insurance   59,747     58,682     58,284 
Intangible assets, net   107,694     108,542     109,498 
Other real estate owned   5,194     5,852     9,952 
Other assets   56,218     47,628     48,022 
  Total Assets$  6,762,132  $  6,075,577  $  5,887,855 
      
Liabilities and Shareholders' Equity     
Deposits:     
Noninterest bearing demand$  1,668,271  $  1,405,067  $  1,402,447 
Interest bearing transaction   297,973     178,797     207,716 
Savings and money market   2,802,519     2,835,325     2,514,310 
Time, $100,000 or more   452,015     406,570     439,248 
Other time   337,371     332,685     362,867 
Total deposits   5,558,149     5,158,444     4,926,588 
Customer repurchase agreements   71,642     72,356     64,893 
Other short-term borrowings   50,000     -      -  
Long-term borrowings   216,419     68,928     68,897 
Other liabilities   50,283     37,248     41,408 
Total liabilities   5,946,493     5,336,976     5,101,786 
      
Shareholders' Equity     
      
Preferred stock, par value $.01 per share, shares authorized 1,000,000,     
Series B, $1,000 per share liquidation preference, shares issued and     
outstanding -0- at September 30, 2016 and December 31, 2015, and 56,600 at     
September 30, 2015;  Series C, $1,000 per share liquidation preference,     
shares issued and outstanding -0- at September 30, 2016 and December 31, 2015,     
and 15,300 at September 30, 2015   -      -      71,900 
Common stock, par value $.01 per share; shares authorized 100,000,000, shares     
issued and outstanding 33,590,880, 33,467,893 and 33,405,510 respectively    333     331     330 
Warrant   946     946     946 
Additional paid in capital   509,707     503,529     500,334 
Retained earnings    305,593     233,604     211,318 
Accumulated other comprehensive (loss) income    (940)    191     1,241 
Total Shareholders' Equity   815,639     738,601     786,069 
Total Liabilities and Shareholders' Equity$  6,762,132  $  6,075,577  $  5,887,855 
      


Eagle Bancorp, Inc.       
Consolidated Statements of Operations (Unaudited)       
(dollars in thousands, except per share data)       
    
 Nine Months Ended September 30, Three Months Ended September 30,
Interest Income 2016   2015   2016   2015 
Interest and fees on loans$  202,002  $  178,063  $  69,869  $  61,006 
Interest and dividends on investment securities   7,121     7,189     2,177     2,745 
Interest on balances with other banks and short-term investments   856     604     376     228 
Interest on federal funds sold    31     13     9     2 
Total interest income   210,010     185,869     72,431     63,981 
Interest Expense       
Interest on deposits   13,513     10,668     4,840     3,739 
Interest on customer repurchase agreements    115     94     39     33 
Interest on short-term borrowings   727     54     383     -  
Interest on long-term borrowings   4,515     3,687     2,441     1,124 
Total interest expense   18,870     14,503     7,703     4,896 
Net Interest Income    191,140     171,366     64,728     59,085 
Provision for Credit Losses   9,219     10,043     2,288     3,262 
Net Interest Income After Provision For Credit Losses   181,921     161,323     62,440     55,823 
        
Noninterest Income       
Service charges on deposits   4,303     3,990     1,431     1,374 
Gain on sale of loans   8,464     9,364     3,009     2,483 
Gain on sale of investment securities   1,123     2,224     1     60 
Loss on early extinguishment of debt   -      (1,130)    -      -  
Increase in the cash surrender value of  bank owned life insurance    1,171     1,191     391     395 
Other income   5,209     4,497     1,573     1,787 
Total noninterest income   20,270     20,136     6,405     6,099 
Noninterest Expense       
Salaries and employee benefits   49,157     45,772     17,130     15,383 
Premises and equipment expenses   11,419     12,056     3,786     3,974 
Marketing and advertising   2,551     2,182     857     762 
Data processing   5,716     5,598     1,879     1,976 
Legal, accounting and professional fees   2,845     2,915     771     1,063 
FDIC insurance   2,193     2,348     629     794 
Merger expenses   -      139     -      2 
Other expenses   11,354     11,066     3,786     3,451 
Total noninterest expense 85,235   82,076   28,838   27,405 
Income Before Income Tax Expense   116,956     99,383     40,007     34,517 
Income Tax Expense   44,966     37,564     15,484     13,054 
Net Income    71,990     61,819     24,523     21,463 
Preferred Stock Dividends    -      539     -      180 
Net Income Available to Common Shareholders$  71,990  $  61,280  $  24,523  $  21,283 
        
Earnings Per Common Share       
Basic$  2.14  $  1.88  $  0.73  $  0.64 
Diluted$  2.11  $  1.84  $  0.72  $  0.63 
        

 

Eagle Bancorp, Inc.
Consolidated Average Balances, Interest Yields And Rates (Unaudited)
(dollars in thousands)
        
 Three Months Ended September 30,
  2016   2015 
 Average BalanceInterestAverage Yield/Rate Average BalanceInterestAverage Yield/Rate
ASSETS       
Interest earning assets:       
Interest bearing deposits with other banks and other short-term investments$  336,741 $  376  0.44% $  375,341 $  228  0.24%
Loans held for sale (1)   66,791    586  3.51%    38,373    374  3.90%
Loans (1) (2)    5,422,677    69,283  5.08%    4,636,298    60,632  5.19%
Investment securities available for sale (2)   429,207    2,177  2.02%    491,800    2,745  2.21%
Federal funds sold    9,115    9  0.39%    3,586    2  0.22%
  Total interest earning assets   6,264,531    72,431  4.60%    5,545,398    63,981  4.58%
        
Total noninterest earning assets   283,564       279,425   
Less: allowance for credit losses   55,821       49,540   
  Total noninterest earning assets   227,743       229,885   
  TOTAL ASSETS$  6,492,274    $  5,775,283   
        
LIABILITIES AND SHAREHOLDERS' EQUITY       
Interest bearing liabilities:       
Interest bearing transaction$  269,230 $  193  0.29% $  202,885 $  97  0.19%
Savings and money market    2,641,863    2,976  0.45%    2,453,141    2,092  0.34%
Time deposits    784,834    1,671  0.85%    797,472    1,550  0.77%
  Total interest bearing deposits   3,695,927    4,840  0.52%    3,453,498    3,739  0.43%
Customer repurchase agreements   73,749    39  0.21%    56,624    33  0.23%
Other short-term borrowings   50,013    383  3.00%    3    -  - 
Long-term borrowings   176,321    2,441  5.42%    71,388    1,124  6.16%
  Total interest bearing liabilities   3,996,010    7,703  0.77%    3,581,513    4,896  0.54%
        
Noninterest bearing liabilities:       
Noninterest bearing demand    1,657,907       1,389,208   
Other liabilities   28,384       26,283   
  Total noninterest bearing liabilities   1,686,291       1,415,491   
        
Shareholders’ equity   809,973       778,279   
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$  6,492,274    $  5,775,283   
        
Net interest income $  64,728    $  59,085  
Net interest spread   3.83%    4.04%
Net interest margin   4.11%    4.23%
Cost of funds   0.49%    0.35%
        
(1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $4.1 million and $3.2 million
  for the three months ended September 30, 2016 and 2015, respectively.
(2) Interest and fees on loans and investments exclude tax equivalent adjustments.       
        

 

Eagle Bancorp, Inc.
Consolidated Average Balances, Interest Yields and Rates (Unaudited)
(dollars in thousands)
        
 Nine Months Ended September 30,
  2016   2015 
 Average BalanceInterestAverage Yield/Rate Average BalanceInterestAverage Yield/Rate
ASSETS       
Interest earning assets:       
Interest bearing deposits with other banks and other short-term investments$  252,871 $  856  0.45% $  336,989 $  604  0.24%
Loans held for sale (1)   47,786    1,288  3.59%    45,863    1,288  3.74%
Loans (1) (2)    5,253,742    200,714  5.10%    4,505,092    176,775  5.25%
Investment securities available for sale (2)   462,408    7,121  2.06%    412,912    7,189  2.33%
Federal funds sold    9,550    31  0.43%    6,992    13  0.25%
  Total interest earning assets   6,026,357    210,010  4.65%    5,307,848    185,869  4.68%
        
Total noninterest earning assets   281,697       277,793   
Less: allowance for credit losses   55,187       48,240   
  Total noninterest earning assets   226,510       229,553   
  TOTAL ASSETS$  6,252,867    $  5,537,401   
        
LIABILITIES AND SHAREHOLDERS' EQUITY       
Interest bearing liabilities:       
Interest bearing transaction$  234,481 $  445  0.25% $  178,256 $  208  0.16%
Savings and money market    2,656,638    8,324  0.42%    2,379,643    6,066  0.34%
Time deposits    764,099    4,744  0.83%    778,375    4,394  0.75%
  Total interest bearing deposits   3,655,218    13,513  0.49%    3,336,274    10,668  0.43%
Customer repurchase agreements   71,973    115  0.21%    54,945    94  0.23%
Other short-term borrowings   38,873    727  2.46%    27,492    54  0.26%
Long-term borrowings   105,005    4,515  5.65%    85,489    3,687  5.69%
  Total interest bearing liabilities   3,871,069    18,870  0.65%    3,504,200    14,503  0.55%
        
Noninterest bearing liabilities:       
Noninterest bearing demand    1,570,586       1,275,050   
Other liabilities   27,713       25,995   
  Total noninterest bearing liabilities   1,598,299       1,301,045   
        
Shareholders’ equity   783,499       732,156   
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$  6,252,867    $  5,537,401   
        
Net interest income $  191,140    $  171,366  
Net interest spread   4.00%    4.13%
Net interest margin   4.23%    4.32%
Cost of funds   0.42%    0.36%
        
(1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $11.7 million and $8.9 million
  for the nine months ended September 30, 2016 and 2015, respectively.
(2) Interest and fees on loans and investments exclude tax equivalent adjustments.       

 

Eagle Bancorp, Inc. 
Statements of Income and Highlights Quarterly Trends (Unaudited) 
(dollars in thousands, except per share data) 
 Three Months Ended 
 September 30, June 30, March 31, December 31, September 30, June 30, March 31, December 31,
Income Statements: 2016   2016   2016   2015   2015   2015   2015   2014 
Total interest income$  72,431  $  69,772  $  67,807  $  67,311  $  63,981  $  62,423  $  59,465  $  56,091 
Total interest expense   7,703     5,950     5,217     4,735     4,896     4,873     4,734     4,275 
Net interest income   64,728     63,822     62,590     62,576     59,085     57,550     54,731     51,816 
Provision for credit losses   2,288     3,888     3,043     4,595     3,262     3,471     3,310     3,700 
Net interest income after provision for credit losses   62,440     59,934     59,547     57,981     55,823     54,079     51,421     48,116 
  Noninterest income (before investment gains               
  & extinguishment of debt)   6,404     7,077     5,666     6,462     6,039     6,233     6,770     5,298 
  Gain on sale of investment securities   1     498     624     30     60     -      2,164     12 
  Loss on early extinguishment of debt   -      -      -      -      -      -      (1,130)    -  
Total noninterest income   6,405     7,575     6,290     6,492     6,099     6,233     7,804     5,310 
  Salaries and employee benefits   17,130     15,908     16,119     15,977     15,383     14,683     15,706     15,703 
  Premises and equipment    3,786     3,807     3,826     3,970     3,974     4,072     4,010     3,747 
  Marketing and advertising   857     920     774     566     762     735     685     578 
  Merger expenses   -      -      -      2     2     26     111     3,239 
  Other expenses   7,065     7,660     7,383     8,125     7,284     7,082     7,561     6,085 
Total noninterest expense   28,838     28,295     28,102     28,640     27,405     26,598     28,073     29,352 
Income before income tax expense   40,007     39,214     37,735     35,833     34,517     33,714     31,152     24,074 
Income tax expense   15,484     15,069     14,413     13,485     13,054     12,776     11,734     9,347 
Net income   24,523     24,145     23,322     22,348     21,463     20,938     19,418     14,727 
Preferred stock dividends    -      -      -      62     180     179     180     180 
Net income available to common shareholders$  24,523  $  24,145  $  23,322  $  22,286  $  21,283  $  20,759  $  19,238  $  14,547 
                
                
Per Share Data:               
Earnings per weighted average common share, basic$  0.73  $  0.72  $  0.70  $  0.67  $  0.64  $  0.62  $  0.62  $  0.51 
Earnings per weighted average common share, diluted $  0.72  $  0.71  $  0.68  $  0.65  $  0.63  $  0.61  $  0.61  $  0.49 
Weighted average common shares outstanding, basic    33,590,183     33,588,141     33,518,998     33,462,937     33,400,973     33,367,476     31,082,715     28,777,778 
Weighted average common shares outstanding, diluted    34,187,171     34,183,209     34,104,237     34,069,786     34,026,412     33,997,989     31,776,323     29,632,685 
Actual shares outstanding   33,590,880     33,584,898     33,581,599     33,467,893     33,405,510     33,394,563     33,303,467     30,139,396 
Book value per common share at period end $  24.28  $  23.48  $  22.71  $  22.07  $  21.38  $  20.76  $  20.11  $  18.21 
Tangible book value per common share at period end (1)$  21.08  $  20.27  $  19.48  $  18.83  $  18.10  $  17.46  $  16.82  $  14.56 
                
Performance Ratios (annualized):               
Return on average assets 1.50%  1.57%  1.54%  1.50%  1.47%  1.51%  1.49%  1.21%
Return on average common equity 12.04%  12.40%  12.39%  12.08%  11.95%  12.18%  13.24%  11.67%
Net interest margin 4.11%  4.30%  4.31%  4.38%  4.23%  4.33%  4.41%  4.42%
Efficiency ratio (2) 40.54%  39.63%  40.80%  41.47%  42.04%  41.70%  44.89%  51.38%
                
Other Ratios:               
Allowance for credit losses to total loans (3) 1.04%  1.05%  1.06%  1.05%  1.05%  1.07%  1.07%  1.07%
Nonperforming loans to total loans (3) 0.41%  0.40%  0.43%  0.26%  0.30%  0.33%  0.44%  0.52%
Allowance for credit losses to total nonperforming loans 255.29%  264.44%  249.03%  397.95%  347.82%  328.98%  244.12%  205.30%
Nonperforming assets to total assets 0.41%  0.39%  0.42%  0.31%  0.41%  0.44%  0.58%  0.68%
Net charge-offs (annualized) to average loans (3) 0.14%  0.15%  0.09%  0.18%  0.16%  0.21%  0.15%  0.26%
Tier 1 capital (to average assets) 11.12%  11.24%  11.01%  10.90%  11.96%  12.03%  12.19%  10.69%
Total capital (to risk weighted assets) 15.05%  12.71%  12.87%  12.75%