Atlantic Capital Bancshares, Inc. Reports First Quarter 2021 Results

Thursday, 22. April 2021 22:10

ATLANTA, April 22, 2021 (GLOBE NEWSWIRE) -- Atlantic Capital Bancshares, Inc. (NASDAQ: ACBI) announced net income for the quarter ended March 31, 2021 of $13.4 million, or $0.65 per diluted share, compared to $2.2 million, or $0.10 per diluted share, for the first quarter of 2020 and $10.0 million, or $0.48 per diluted share, for the fourth quarter of 2020.

“Atlantic Capital reported another quarter of strong revenue growth despite lower interest rates and soft loan demand. As the economic recovery has gained strength, our borrowers’ performance has improved which has resulted in a reduction in the allowance for credit losses. We anticipate these trends in revenue growth and credit quality improvement to continue over the balance of the year,” remarked Douglas Williams, President and Chief Executive Officer.

First Quarter Highlights(1)

  • Total assets of $3.7 billion, compared to $3.6 billion at December 31, 2020 and $2.7 billion at March 31, 2020.
  • Loans held for investment increased $51.2 million, or 9% annualized, from December 31, 2020 and increased $367.9 million, or 19%, from March 31, 2020.
  • Quarterly average deposits increased $282.5 million, or 39% annualized, compared to the fourth quarter of 2020 and increased $902.4 million, or 40%, compared to the first quarter of 2020.
  • Cost of deposits decreased to 0.12% from 0.16% in the fourth quarter of 2020 and from 0.75% in the first quarter of 2020.
  • Tangible book value per share increased to $15.74 from $15.62 at December 31, 2020 and from $14.54 at March 31, 2020.
  • Annualized net charge-offs to average loans totaled 0.04% for the first quarter of 2021 and non-performing assets to total assets were 0.06% at March 31, 2021.
  • The allowance for credit losses was 1.31% of total loans held for investment at March 31, 2021, compared to 1.55% at December 31, 2020.
  • Repurchased 222,000 shares in the first quarter of 2021 totaling $4.2 million at an average price of $18.87. As of March 31, 2021, approximately $3.1 million remained from our $25 million share repurchase program.

Income Statement

Taxable equivalent net interest income totaled $23.7 million for the first quarter of 2021, an increase of $2.5 million, or 12%, from the first quarter of 2020, and an increase of $721,000, or 13% annualized, from the fourth quarter of 2020. The first quarter of 2021 included $2.2 million in Paycheck Protection Program (“PPP”) loan income compared to $2.3 million in the fourth quarter of 2020.

Taxable equivalent net interest margin was 2.81% in the first quarter of 2021, compared to 3.41% in the first quarter of 2020 and 2.91% in the fourth quarter of 2020. The linked quarter decrease in net interest margin was primarily due to the impact of the increase in deposits and corresponding increase in cash balances.

The yield on loans in the first quarter of 2021 was 3.89%, a decrease of 88 basis points from the first quarter of 2020 and unchanged from the fourth quarter of 2020. Excluding the PPP loans, the first quarter of 2021 loan yield was 3.83%, a decrease of 3 basis points compared to the fourth quarter of 2020.

The cost of deposits in the first quarter of 2021 was 0.12%, a decrease of 63 basis points from the first quarter of 2020 and a decrease of 4 basis points from the fourth quarter of 2020. The cost of interest bearing deposits decreased 90 basis points to 0.19% from the first quarter of 2020, and decreased 6 basis points from the fourth quarter of 2020.

In the first quarter of 2021, we recorded a negative provision for credit losses of $4.5 million compared to a provision for credit losses of $8.1 million in the first quarter of 2020 and $481,000 in the fourth quarter of 2020. The first quarter of 2021 provision for credit losses included a negative provision for loan losses of $4.1 million and a negative provision for unfunded commitments of $445,000.

Noninterest income totaled $3.6 million in the first quarter of 2021 compared to $2.4 million in the first quarter of 2020 and $3.0 million in the fourth quarter of 2020. Service charge income in the first quarter of 2021 totaled $1.7 million, an increase of $431,000 compared to the first quarter of 2020, and an increase of $322,000 from the fourth quarter of 2020. The increase in service charge income was primarily due to growth in our payments, fintech and private capital solution businesses. SBA income in the first quarter of 2021 totaled $1.2 million, compared to $414,000 in the first quarter of 2020 and $1.0 million in the fourth quarter of 2020. The increase was primarily from higher SBA origination volume and higher SBA premiums in the secondary market.

Noninterest expense totaled $15.1 million in the first quarter of 2021, compared to $12.9 million in the first quarter of 2020 and $13.2 million in the fourth quarter of 2020. Salaries and employee benefits expense totaled $10.4 million in the first quarter of 2021, an increase of $2.0 million compared to the fourth quarter of 2020. Salaries and employee benefits expense in the first quarter of 2021 included approximately a $700,000 seasonal increase in benefit costs and $255,000 in contract labor expense for PPP round two loan processing. In addition, the first quarter of 2021 included an increase in short-term and long-term incentive costs, along with the partial impact of eight net new hires and merit increases during the quarter. Professional services expense in the first quarter totaled $922,000 and included approximately $200,000 in consulting expense for PPP round two loan processing and PPP round one loan forgiveness.

(1) Commentary is on a fully taxable-equivalent basis unless otherwise noted. Consistent with SEC guidance in Industry Guide 3 that contemplates the calculation of tax-exempt income on a tax equivalent basis, net interest income and net interest margin are provided on a fully taxable-equivalent basis, which generally assumes a 21% marginal tax rate. We provide detailed reconciliations in the Non-GAAP Performance and Financial Measures Reconciliation table on page 12.

Balance Sheet

Total loans held for investment were $2.3 billion at March 31, 2021, an increase of $367.9 million, or 19%, from March 31, 2020 and an increase of $51.8 million, or 9% annualized, from December 31, 2020. PPP loans totaled $218.8 million at March 31, 2021, an increase of $26.6 million compared to December 31, 2020, and included $72.8 million in new round two PPP loans offset by $46.2 million in forgiven round one PPP loans.

The allowance for credit losses was 1.31% of total loans held for investment at March 31, 2021, compared to 1.55% at December 31, 2020. The decrease in the allowance was a result of an improvement in the new Current Expected Credit Losses, or CECL economic forecast along with credit rating upgrades for criticized and classified loans. Excluding the impact of PPP loans, the allowance for credit losses at March 31, 2021 was 1.45%, compared to 1.70% at December 31, 2020.

Total average deposits were $3.2 billion for the first quarter of 2021, an increase of $902.4 million, or 40%, from the first quarter of 2020 and an increase of $282.5 million, or 39% annualized, from the fourth quarter of 2020. Average noninterest bearing deposits were $1.1 billion for the first quarter of 2021, an increase of $423.5 million, or 59%, from the first quarter of 2020 and an increase of $159.5 million, or 66% annualized, from the fourth quarter of 2020. Noninterest bearing deposits were 36.0% of total average deposits in the first quarter of 2021, compared to 31.6% in the first quarter of 2020 and 34.0% in the fourth quarter of 2020.

Tangible common equity to tangible assets decreased to 8.6% at March 31, 2021 compared to 8.9% at December 31, 2020, due to the impact from the first quarter growth in deposits and its corresponding increase on the level of total tangible assets. Cash and cash equivalents were $645.8 million and total assets were $3.7 billion at March 31, 2021 compared to cash and cash equivalents of $142.4 million and total assets of $2.7 billion at March 31, 2020.

Earnings Conference Call

Atlantic Capital will host a conference call at 1:00 p.m. ET on Friday, April 23, 2021, to discuss the financial results for the quarter ended March 31, 2021. Individuals wishing to participate in the conference call may do so by dialing 833-685-0902 from the United States. The call will also be available live via webcast on the Investor Relations page of our website, www.atlanticcapitalbank.com. A presentation will be used during the earnings conference call and is available at https://atlanticcapitalbank.q4ir.com/news-market-data/presentations/default.aspx.

Non-GAAP Financial Measures

Statements included in this press release include non-GAAP financial measures and should be read along with the accompanying tables, which provide a reconciliation of non-GAAP financial measures to GAAP financial measures. Atlantic Capital management uses non-GAAP financial measures, including: (i) taxable equivalent interest income; (ii) taxable equivalent net interest income; (iii) loan yield excluding PPP loans; (iv) taxable equivalent net interest margin; (v) taxable equivalent net interest margin excluding PPP loans; (vi) taxable equivalent income before income taxes; (vii) taxable equivalent income tax expense; (viii) tangible common equity to tangible assets; (ix) tangible book value per common share, and (x) allowance for credit losses to loans held for investment excluding PPP loans, in our analysis of the Company's performance. Tangible common equity excludes goodwill from shareholders' equity.

Management believes that non-GAAP financial measures provide a greater understanding of ongoing performance and operations and enhance comparability with prior periods. Non-GAAP financial measures should not be considered as an alternative to any measure of performance or financial condition as determined in accordance with GAAP, and investors should consider Atlantic Capital’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the results or financial condition as reported under GAAP. Non-GAAP financial measures may not be comparable to non- GAAP financial measures presented by other companies.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections and statements of our beliefs concerning future events, business plans, objectives, expected operating results and the assumptions upon which those statements are based. Forward-looking statements include without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and are typically identified with words such as “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “project,” “expect,” “intend,” “plan,” “strive,” or words or phases of similar meaning. Forward-looking statements may include, among other things, statements about Atlantic Capital’s confidence in its strategies and its expectations about financial performance, the impact of COVID-19 on operations, market growth, market and regulatory trends and developments, acquisitions and divestitures, new technologies, services and opportunities and earnings. The forward-looking statements are based largely on Atlantic Capital’s expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond Atlantic Capital’s control. Atlantic Capital undertakes no obligation to publicly update any forward-looking statement to reflect developments occurring after the statement is made, except as otherwise required by law. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements as a result of, among other factors, the risks and uncertainties described in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Atlantic Capital’s Annual Report on Form 10-K. Please refer to the SEC’s website at www.sec.gov where you can review those documents.

About Atlantic Capital Bancshares

Atlantic Capital Bancshares, Inc. is a $3.7 billion publicly traded bank holding company headquartered in Atlanta, Georgia. Atlantic Capital offers commercial and not-for-profit banking services, specialty corporate financial services, private banking services and commercial real estate finance solutions to privately held companies and individuals in the Atlanta area, as well as payments and other specialized financial services for select clients nationally.

Media Contact:
Ashley Carson
Email: ashley.carson@atlcapbank.com
Phone: 404-995-6050
(ACB-ER)

Financial Contact:
Patrick Oakes
Email: patrick.oakes@atlcapbank.com
Phone: 404-995-6050


ATLANTIC CAPITAL BANCSHARES, INC.                 
Selected Financial Information                  
                   
                   
 2021 2020 First Quarter
2021
 
(in thousands, except share and per share data;First    Fourth    Third    Second    First     
taxable equivalent)Quarter Quarter Quarter Quarter Quarter to 2020 
INCOME SUMMARY                        
Interest income - taxable equivalent (1)$25,775  $25,288 $24,578 $24,151 $26,246  (2)%  
Interest expense 2,065   2,299  2,515  2,166  5,043  (59) 
Net interest income - taxable equivalent 23,710   22,989  22,063  21,985  21,203  12  
Provision for credit losses (4,519)  481  28  8,863  8,074  (156) 
Net interest income after provision for credit losses 28,229   22,508  22,035  13,122  13,129  115  
Noninterest income 3,562   3,016  2,504  2,343  2,422  47  
Noninterest expense 15,149   13,164  13,713  12,904  12,877  18  
Income before income taxes 16,642   12,360  10,826  2,561  2,674  522  
Income tax expense 3,280   2,410  2,208  712  550  496  
Net income(1)(2)$13,362  $9,950 $8,618 $1,849 $2,124  529 %  
                   
PER SHARE DATA                        
Diluted earnings per share$0.65  $0.48 $0.40 $0.09 $0.10    
Book value per share 16.72   16.60  16.05  15.64  15.47    
Tangible book value per common share (2) 15.74   15.62  15.11  14.72  14.54    
                   
PERFORMANCE MEASURES                       
Return on average equity 15.99 %   11.68%   10.05%   2.20%   2.56%   
Return on average assets 1.50   1.19  1.15  0.25  0.32    
Taxable equivalent net interest margin 2.81   2.91  3.14  3.23  3.41    
Taxable equivalent net interest margin excluding PPP loans 2.70   2.81  3.18  3.35  3.41    
Efficiency ratio 56.30   51.30  56.61  53.82  55.03    
Average loans to average deposits 71.93   76.81  88.65  88.46  83.84    
CAPITAL                       
Average equity to average assets 9.39 %   10.18%   11.45%   11.53%   12.41%   
Tangible common equity to tangible assets 8.63   8.86  11.03  11.01  11.57    
Leverage ratio 8.4 (3) 8.9  9.9  9.9  10.7    
Total risk based capital ratio 16.4 (3) 16.1  16.9  14.8  14.9    
                   
SHARES OUTSTANDING                  
Number of common shares outstanding - basic 20,354,077   20,394,912  21,202,783  21,477,631  21,479,986    
Number of common shares outstanding - diluted 20,617,188   20,492,542  21,298,098  21,569,050  21,675,934    
Average number of common shares - basic 20,380,066   20,711,089  21,500,735  21,472,462  21,689,038    
Average number of common shares - diluted 20,502,184   20,795,332  21,543,805  21,535,040  21,842,175    
                   
ASSET QUALITY                       
Allowance for credit losses to loans held for investment 1.31 %   1.55%   1.59%   1.61%   1.43%   
Net charge-offs to average loans (4) 0.04   0.05  0.06  0.29  0.04    
Non-performing assets to total assets 0.06   0.13  0.20  0.24  0.27    
                   
AVERAGE BALANCES                  
Total loans$2,270,660  $2,207,956 $2,191,669 $2,131,847 $1,890,184    
Investment securities 579,547   491,134  453,382  462,850  417,971    
Total assets 3,611,417   3,328,719  2,977,444  2,932,716  2,686,266    
Deposits 3,156,906   2,874,402  2,472,218  2,409,958  2,254,505    
Shareholders' equity 338,990   338,948  341,017  338,027  333,480    
                   
AT PERIOD END                  
  Loans and loans held for sale$2,302,661  $2,249,036 $2,188,894 $2,185,847 $1,932,909    
  Investment securities 613,236   535,579  446,706  457,749  466,405    
  Total assets 3,732,668   3,615,617  2,923,977  2,890,622  2,719,658    
  Deposits 3,277,692   3,161,508  2,468,722  2,407,631  2,225,119    
  Shareholders’ equity 340,328   338,586  340,309  335,980  332,300    
                   
(1)Interest income on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21%, reflecting the statutory federal income tax rate.
(2)Excludes effect of acquisition related intangibles.                  
(3)Amounts are estimates as of March 31, 2021.                  
(4)Annualized.                  



ATLANTIC CAPITAL BANCSHARES, INC.         
Consolidated Balance Sheets (unaudited)         
          
     March 31,     December 31,     March 31, 
(in thousands, except share data) 2021 2020 2020
ASSETS            
Cash and due from banks $32,850  $16,865  $27,536 
Interest-bearing deposits in banks  612,966   636,537   114,829 
Cash and cash equivalents  645,816   653,402   142,365 
Investment securities available for sale  390,701   335,423   280,390 
Investment securities held to maturity, net of allowance for credit losses of
$14 at March 31, 2021, December 31, 2020 and March 31, 2020,
respectively
  222,535   200,156   186,015 
Other investments  24,709   25,892   27,140 
Loans held for sale  1,847       
Loans held for investment  2,300,814   2,249,036   1,932,909 
Less: allowance for loan losses  (27,506)  (31,818)  (24,896)
Loans held for investment, net  2,273,308   2,217,218   1,908,013 
Premises and equipment, net  20,633   21,589   22,533 
Bank owned life insurance  73,223   72,856   66,761 
Goodwill  19,925   19,925   19,925 
Other intangibles, net  2,688   2,731   2,785 
Other real estate owned  16   16   779 
Other assets  57,267   66,409   62,952 
Total assets $3,732,668  $3,615,617  $2,719,658 
          
LIABILITIES AND SHAREHOLDERS’ EQUITY            
Deposits:            
Noninterest-bearing demand $1,280,524  $1,033,765  $712,919 
Interest-bearing checking  485,540   760,638   368,463 
Savings  562   625   567 
Money market  1,142,361   1,030,753   982,109 
Time  294,129   241,328   66,793 
Brokered deposits  74,576   94,399   94,268 
Total deposits  3,277,692   3,161,508   2,225,119 
Federal funds purchased        75,000 
Long-term debt  73,878   73,807   49,916 
Other liabilities  40,770   41,716   37,323 
Total liabilities  3,392,340   3,277,031   2,387,358 
          
SHAREHOLDERS’ EQUITY            
Preferred stock, no par value; 10,000,000 shares authorized; no shares
issued and outstanding as of March 31, 2021, December 31, 2020 and March 31, 2020
         
Common stock, no par value; 100,000,000 shares authorized; 20,354,077,
20,394,912, and 21,479,986 shares issued and outstanding as of
March 31, 2021, December 31, 2020 and March 31, 2020, respectively
  207,047   209,942   224,233 
Retained earnings  127,499   114,137   93,721 
Accumulated other comprehensive income  5,782   14,507   14,346 
Total shareholders’ equity  340,328   338,586   332,300 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $3,732,668  $3,615,617  $2,719,658 
 



ATLANTIC CAPITAL BANCSHARES, INC.            
Consolidated Statements of Income (unaudited)            
                
(in thousands, except share and per share data) Three months ended
     March 31,     December 31,     September 30,     June 30,  March 31, 
  2021 2020 2020 2020 2020
INTEREST INCOME                    
Loans, including fees $21,769  $21,609  $21,049  $20,496  $22,426
Investment securities  3,374   3,000   2,910   3,041   2,732
Interest and dividends on other interest‑earning assets 267   334   274   260   865
Total interest income  25,410   24,943   24,233   23,797   26,023
INTEREST EXPENSE                    
Interest on deposits  971   1,188   1,151   1,299   4,182
Interest on Federal Home Loan Bank advances        16   38   
Interest on federal funds purchased and securities sold
under agreements to repurchase
        3   6   32
Interest on long-term debt  1,094   1,111   1,345   823   829
Total interest expense  2,065   2,299   2,515   2,166   5,043
NET INTEREST INCOME BEFORE PROVISION
FOR CREDIT LOSSES
  23,345   22,644   21,718   21,631   20,980
Provision for credit losses  (4,519)  481   28   8,863   8,074
NET INTEREST INCOME AFTER PROVISION
FOR CREDIT LOSSES
  27,864   22,163   21,690   12,768   12,906
NONINTEREST INCOME               
Service charges  1,663   1,341   1,217   1,081   1,232
Gains (losses) on sale of securities  2   (23)        
(Losses) gains on sale of other assets     (6)  (145)     5
Derivatives income (loss)  47   11   10   (10)  246
Bank owned life insurance  391   368   363   367   362
SBA lending activities  1,225   1,015   893   782   414
Other noninterest income  234   310   166   123   163
Total noninterest income  3,562   3,016   2,504   2,343   2,422
NONINTEREST EXPENSE                    
Salaries and employee benefits  10,421   8,437   8,850   8,466   8,476
Occupancy  734   767   739   883   794
Equipment and software  774   969   826   763   779
Professional services  922   686   562   792   705
Communications and data processing  792   789   757   670   897
Marketing and business development  108   144   141   79   153
Travel, meals and entertainment  10   14   39   34   140
FDIC premiums  275   241   213   175   
Other noninterest expense  1,113   1,117   1,586   1,042   933
Total noninterest expense  15,149   13,164   13,713   12,904   12,877
                
INCOME BEFORE PROVISION FOR INCOME
TAXES
  16,277   12,015   10,481   2,207   2,451
Provision for income taxes  2,915   2,065   1,863   358   327
NET INCOME $13,362  $9,950  $8,618  $1,849  $2,124
                
Net income per common share - basic $0.66  $0.48  $0.40  $0.09  $0.10
Net income per common share - diluted $0.65  $0.48  $0.40  $0.09  $0.10
                
Weighted average shares - basic  20,380,066   20,711,089   21,500,735   21,472,462   21,689,038
Weighted average shares - diluted  20,502,184   20,795,332   21,543,805   21,535,040   21,842,175
                



ATLANTIC CAPITAL BANCSHARES, INC.                   
Average Balance Sheets and Net Interest Margin Analysis                  
Selected Financial Information                   
  Three months ended   
  March 31, 2021  December 31, 2020  
          Interest    Tax          Interest    Tax  
     Average    Income/    Equivalent        Average    Income/    Equivalent  
(dollars in thousands; taxable equivalent) Balance Expense Yield/Rate  Balance Expense Yield/Rate  
Assets                         
Interest bearing deposits in other banks $561,809 $168 0.12%$435,939 $141 0.13%
Investment securities:                   
Taxable investment securities  356,250  1,898 2.16   275,872  1,587 2.29  
Non-taxable investment securities (1)  223,297  1,841 3.34   215,262  1,758 3.25  
Total investment securities  579,547  3,739 2.62   491,134  3,345 2.71  
Loans  2,270,660  21,769 3.89   2,207,956  21,609 3.89  
FHLB and FRB stock  12,701  99 3.17   12,699  193 6.05  
Total interest-earning assets  3,424,717  25,775 3.05   3,147,728  25,288 3.20  
Non-earning assets  186,700        180,991       
Total assets $3,611,417       $3,328,719       
Liabilities                   
Interest bearing deposits:                   
NOW, money market, and savings  1,662,097  834 0.20   1,585,928  1,043 0.26  
Time deposits  273,615  74 0.11   221,792  72 0.13  
Brokered deposits  84,663  63 0.30   89,673  73 0.32  
Total interest-bearing deposits  2,020,375  971 0.19   1,897,393  1,188 0.25  
Total long-term debt  73,830  1,094 6.01   73,811  1,111 5.99  
Total interest-bearing liabilities  2,094,205  2,065 0.40   1,971,204  2,299 0.46  
Demand deposits  1,136,531        977,009       
Other liabilities  41,691        41,558       
Shareholders’ equity  338,990        338,948       
Total liabilities and shareholders’ equity $3,611,417       $3,328,719       
Net interest spread        2.65%       2.73%
Net interest income and net interest margin (2)     $23,710 2.81%    $22,989 2.91%
                    
Non-taxable equivalent net interest margin         2.76%        2.86%
                    
(1) Interest revenue on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21%, reflecting the statutory federal income tax rate.  
(2) Tax equivalent net interest income divided by total interest-earning assets using the appropriate day count convention based on the type of interest-earning asset. 
                    
                    
  Three months ended   
  March 31, 2021  March 31, 2020  
          Interest    Tax          Interest    Tax  
     Average    Income/    Equivalent        Average    Income/    Equivalent  
(dollars in thousands; taxable equivalent) Balance Expense Yield/Rate  Balance Expense Yield/Rate  
Assets                         
Interest bearing deposits in other banks $561,809 $168 0.12%  $177,063 $668 1.52%
Other short-term investments        110     
Investment securities:                     
Taxable investment securities  356,250  1,898 2.16   253,937  1,680 2.66  
Non-taxable investment securities (1)  223,297  1,841 3.34   164,034  1,275 3.13  
Total investment securities  579,547  3,739 2.62   417,971  2,955 2.84  
Loans  2,270,660  21,769 3.89   1,890,184  22,426 4.77  
FHLB and FRB stock  12,701  99 3.17   12,678  197 6.25  
Total interest-earning assets  3,424,717  25,775 3.05   2,498,006  26,246 4.23  
Non-earning assets  186,700          188,260         
Total assets $3,611,417         $2,686,266         
Liabilities                         
Interest bearing deposits:                         
NOW, money market, and savings  1,662,097  834 0.20   1,393,541  3,767 1.09  
Time deposits  273,615  74 0.11   55,775  52 0.37  
Brokered deposits  84,663  63 0.30   92,188  363 1.58  
Total interest-bearing deposits  2,020,375  971 0.19   1,541,504  4,182 1.09  
Total borrowings        11,703  32 1.10  
Total long-term debt  73,830  1,094 6.01   49,888  829 6.68  
Total interest-bearing liabilities  2,094,205  2,065 0.40   1,603,095  5,043 1.27  
Demand deposits  1,136,531          713,001         
Other liabilities  41,691          36,690         
Shareholders’ equity  338,990          333,480         
Total liabilities and shareholders’ equity $3,611,417         $2,686,266         
Net interest spread         2.65%          2.96%
Net interest income and net interest margin (2)     $23,710 2.81%      $21,203 3.41%
                    
Non-taxable equivalent net interest margin         2.76%          3.38%
                    
(1) Interest revenue on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21%, reflecting the statutory federal income tax rate. 
(2) Tax equivalent net interest income divided by total interest-earning assets using the appropriate day count convention based on the type of interest-earning asset. 



ATLANTIC CAPITAL BANCSHARES, INC.                    
Period End Loans                     
                      
                              Linked    Year Over
  March 31,     December 31,     September 30,     June 30,     March 31,  Quarter Year
(dollars in thousands) 2021 2020 2020 2020 2020 Change Change
Loans held for sale                            
Loans held for sale $1,847  $  $859  $1,153  $  $1,847  $1,847 
Total loans held for sale $1,847  $  $859  $1,153  $  $1,847  $1,847 
                      
Loans held for investment                            
Commercial loans:                            
Commercial and industrial - other $735,287  $760,645  $712,567  $739,769  $760,062  $(25,358) $(24,775)
Commercial and industrial - PPP  218,766   192,160   231,834   234,049      26,606   218,766 
Commercial real estate:                       
Multifamily  80,507   66,262   58,336   58,909   73,654   14,245   6,853 
Owner occupied  381,018   373,689   364,170   366,847   359,026   7,329   21,992 
Investment  480,566   469,150   458,279   474,565   477,451   11,416   3,115 
Construction and land:                       
1‑4 family residential construction  1,578   1,171      11   2,706   407   (1,128)
Other construction, development, and land  141,218   144,424   139,836   128,980   124,116   (3,206)  17,102 
Total commercial loans  2,038,940   2,007,501   1,965,022   2,003,130   1,797,015   31,439   241,925 
                      
Residential:                            
Residential mortgages  31,817   33,783   29,460   32,327   31,761   (1,966)  56 
Home equity  26,293   25,443   24,528   23,689   23,479   850   2,814 
Total residential loans  58,110   59,226   53,988   56,016   55,240   (1,116)  2,870 
                      
Consumer  203,176   176,066   154,916   113,149   58,164   27,110   145,012 
Other  7,689   13,897   22,777   22,160   25,488   (6,208)  (17,799)
   2,307,915   2,256,690   2,196,703   2,194,455   1,935,907   51,225   372,008 
Less net deferred fees and other unearned income  (7,101)  (7,654)  (8,668)  (9,761)  (2,998)  553   (4,103)
Total loans held for investment $2,300,814  $2,249,036  $2,188,035  $2,184,694  $1,932,909  $51,778  $367,905 
                      
Total loans $2,302,661  $2,249,036  $2,188,894  $2,185,847  $1,932,909  $53,625  $369,752 
                      
Total unfunded commitments $789,869  $813,757  $764,247  $749,321  $689,620  $(23,888) $100,249 
      



ATLANTIC CAPITAL BANCSHARES, INC.                
Allowance for Credit Losses Activity and Credit Quality               
                 
  2021 2020
     First    Fourth    Third    Second    First
(dollars in thousands) Quarter Quarter Quarter Quarter Quarter
Allowance for loan losses                
Balance at beginning of period $31,818  $31,894  $31,605  $24,896  $18,535  
Adoption of ASU 2016-13              (854) 
Provision for loan losses  (4,074)  225   636   8,222   7,409  
Loans charged-off:                     
Commercial and industrial  (288)  (401)  (404)  (1,479)  (18) 
Commercial real estate              (78) 
Construction and land                
Residential mortgages           (36)    
Home equity              (125) 
Consumer                
Other                
Total loans charged-off  (288)  (401)  (404)  (1,515)  (221) 
Recoveries on loans previously charged-off:                     
Commercial and industrial  50   37   56   1     
Commercial real estate     44         18  
Construction and land     18           
Residential mortgages              1  
Home equity                
Consumer     1   1   1   8  
Other                
Total recoveries  50   100   57   2   27  
Net charge-offs $(238) $(301) $(347) $(1,513) $(194) 
Balance at period end $27,506  $31,818  $31,894  $31,605  $24,896  
                 
Allowance for unfunded commitments                     
Balance at beginning of period $3,128  $2,871  $3,480  $2,838  $892  
Adoption of ASU 2016-13              1,275  
Provision for unfunded commitments  (445)  257   (609)  642   671  
Balance at period end $2,683  $3,128  $2,871  $3,480  $2,838  
                 
Total allowance for credit losses - loans and unfunded commitments $30,189  $34,946  $34,765  $35,085  $27,734  
                 
Provision for credit losses under CECL                
Provision for loan losses  (4,074)  225   636   8,222   7,409  
Provision for securities held to maturity credit losses  -   (1)  1   (1)  (6) 
Provision for unfunded commitments  (445)  257   (609)  642   671  
Total provision for credit losses $(4,519) $481  $28  $8,863  $8,074  
                 
Non-performing loans $2,056  $4,862  $5,421  $6,265  $6,515  
Foreclosed properties (OREO)  16   16   563   779   779  
Total nonperforming assets $2,072  $4,878  $5,984  $7,044  $7,294  
                 
Allowance for loan losses to loans held for investment  1.20 %   1.41 %   1.46 %   1.45 %   1.29 %  
Allowance for credit losses to loans held for investment  1.31 %   1.55 %   1.59 %   1.61 %   1.43 %  
Allowance for credit losses to loans held for investment excluding PPP loans  1.45 %  1.70 %  1.78 %  1.80 %  1.43 %  
Net charge-offs to average loans (1)  0.04   0.05   0.06   0.29   0.04  
Non-performing loans as a percentage of total loans  0.09 %   0.22 %   0.25 %   0.29 %   0.34 %  
Non-performing assets as a percentage of total assets  0.06 %   0.13 %   0.20 %   0.24 %   0.27 %  
                 
(1)Annualized.                
                 



ATLANTIC CAPITAL BANCSHARES, INC.               
Period End Deposits                     
                      
                              Linked     
  March 31,  December 31,  September 30,  June 30,  March 31,  Quarter Year Over
(dollars in thousands) 2021 2020 2020 2020 2020 Change Year Change
DDA $1,280,524 $1,033,765 $843,656 $883,662 $712,919 $246,759  $567,605 
NOW  485,540  760,638  387,858  449,737  368,463  (275,098)  117,077 
Savings  562  625  568  583  567  (63)  (5)
Money market  1,142,361  1,030,753  945,834  879,863  982,109  111,608   160,252 
Time  294,129  241,328  196,343  131,353  66,793  52,801   227,336 
Brokered  74,576  94,399  94,463  62,433  94,268  (19,823)  (19,692)
Total deposits $3,277,692 $3,161,508 $2,468,722 $2,407,631 $2,225,119 $116,184  $1,052,573 
                      
                      
Average Deposits                     
                      
     2021 2020    Linked     
  First Fourth Third Second First Quarter Q1 2021 vs
(dollars in thousands) Quarter Quarter Quarter Quarter Quarter Change Q1 2020
DDA $1,136,531 $977,009 $854,715 $815,299 $713,001 $159,522  $423,530 
NOW  618,701  558,967  440,734  462,051  382,178  59,734   236,523 
Savings  587  614  586  574  650  (27)  (63)
Money market  1,042,809  1,026,347  942,062  952,444  1,010,713  16,462   32,096 
Time  273,615  221,792  166,019  96,362  55,775  51,823   217,840 
Brokered  84,663  89,673  68,102  83,228  92,188  (5,010)  (7,525)
Total deposits $3,156,906 $2,874,402 $2,472,218 $2,409,958 $2,254,505 $282,504  $902,401 
                      
Noninterest bearing deposits as a percentage of average deposits  36.0%   34.0%   34.6%   33.8%   31.6%         
Cost of interest-bearing deposits  0.19%  0.25%  0.28%  0.33%  1.09%      
Cost of deposits  0.12%   0.16%   0.19%   0.22%   0.75%         
                      



ATLANTIC CAPITAL BANCSHARES, INC.                
Non-GAAP Performance and Financial Measures Reconciliation                
                 
  2021 2020
     First    Fourth Third Second    First    
(in thousands, except share and per share data) Quarter Quarter Quarter Quarter Quarter 
                 
Taxable equivalent interest income reconciliation                    
Interest income - GAAP $25,410  $24,943  $24,233  $23,797  $26,023  
Taxable equivalent adjustment  365   345   345   354   223  
Interest income - taxable equivalent $25,775  $25,288  $24,578  $24,151  $26,246  
                 
Taxable equivalent net interest income reconciliation                     
Net interest income - GAAP $23,345  $22,644  $21,718  $21,631  $20,980  
Taxable equivalent adjustment  365   345   345   354   223  
Net interest income - taxable equivalent $23,710  $22,989  $22,063  $21,985  $21,203  
                 
Loan yield excluding PPP loans reconciliation                    
Loan yield - GAAP  3.89 %  3.89 %  3.82 %  3.87 %  4.77 %  
Impact of PPP loans  (0.06)  (0.03)  0.13   0.22     
Loan yield excluding PPP loans  3.83 %  3.86 %  3.95 %  4.09 %  4.77 %  
                 
Taxable equivalent net interest margin reconciliation                     
Net interest margin - GAAP  2.76 %   2.86 %   3.09 %   3.17 %   3.38 %  
Impact of taxable equivalent adjustment  0.05   0.05   0.05   0.06   0.03  
Net interest margin - taxable equivalent  2.81 %   2.91 %   3.14 %   3.23 %   3.41 %  
                 
Taxable equivalent net interest margin excluding PPP loans reconciliation                     
Net interest margin - taxable equivalent  2.81 %   2.91 %   3.14 %   3.23 %   3.41 %  
Impact of PPP loans  (0.11)  (0.10)  0.04   0.12     
Net interest margin - taxable equivalent excluding PPP loans  2.70 %   2.81 %   3.18 %   3.35 %   3.41 %  
                 
Taxable equivalent income before income taxes reconciliation                     
Income before income taxes - GAAP $16,277  $12,015  $10,481  $2,207  $2,451  
Taxable equivalent adjustment  365   345   345   354   223  
Income before income taxes $16,642  $12,360  $10,826  $2,561  $2,674  
                 
Taxable equivalent income tax expense reconciliation                     
Income tax expense - GAAP $2,915  $2,065  $1,863  $358  $327  
Taxable equivalent adjustment  365   345   345   354   223  
Income tax expense $3,280  $2,410  $2,208  $712  $550  
                 
Tangible book value per common share reconciliation                     
Total shareholders’ equity $340,328  $338,586  $340,309  $335,980  $332,300  
Intangible assets  (19,925)  (19,925)  (19,925)  (19,925)  (19,925) 
Total tangible common equity $320,403  $318,661  $320,384  $316,055  $312,375  
Common shares outstanding  20,354,077   20,394,912   21,202,783   21,477,631   21,479,986  
Book value per common share - GAAP $16.72  $16.60  $16.05  $15.64  $15.47  
Tangible book value  15.74   15.62   15.11   14.72   14.54  
                 
Tangible common equity to tangible assets reconciliation                     
Total shareholders’ equity $340,328  $338,586  $340,309  $335,980  $332,300  
Intangible assets  (19,925)  (19,925)  (19,925)  (19,925)  (19,925) 
Total tangible common equity $320,403  $318,661  $320,384  $316,055  $312,375  
                 
Total assets $3,732,668  $3,615,617  $2,923,977  $2,890,622  $2,719,658  
Intangible assets  (19,925)  (19,925)  (19,925)  (19,925)  (19,925) 
Total tangible assets $3,712,743  $3,595,692  $2,904,052  $2,870,697  $2,699,733  
Tangible common equity to tangible assets  8.63 %   8.86 %   11.03 %   11.01 %   11.57 %  
                 
Allowance for credit losses to loans held for investment reconciliation                
Total loans held for investment $2,300,814  $2,249,036  $2,188,035  $2,184,694  $1,932,909  
PPP loans  (218,766)  (192,160)  (231,834)  (234,049)    
Total loans held for investment excluding PPP loans $2,082,048  $2,056,876  $1,956,201  $1,950,645  $1,932,909  
                 
Allowance for credit losses to loans held for investment  1.31 %  1.55 %  1.59 %  1.61 %  1.43 %  
Allowance for credit losses to loans held for investment excluding PPP loans  1.45 %  1.70 %  1.78 %  1.80 %  1.43 %  
                 

 


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