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18.01.2022 22:02:00

NICOLET BANKSHARES, INC. ANNOUNCES 2021 EARNINGS

GREEN BAY, Wis., Jan. 18, 2022 /PRNewswire/ -- Nicolet Bankshares, Inc. (NASDAQ: NCBS) ("Nicolet") announced fourth quarter 2021 net income of $16 million and earnings per diluted common share of $1.25, compared to $8 million and $0.73 for third quarter 2021, and $18 million and $1.74 for fourth quarter 2020, respectively.  Annualized quarterly return on average assets was 0.96%, 0.59% and 1.58%, for fourth quarter 2021, third quarter 2021 and fourth quarter 2020, respectively.

Nicolet Bankshares, Inc. Logo (PRNewsFoto/Nicolet Bankshares, Inc.)

Net income for the year ended December 31, 2021 was $61 million and earnings per diluted common share was $5.44, compared to net income of $60 million and earnings per diluted common share of $5.70 for 2020.  Annualized return on average assets was 1.15% and 1.41% for the years ended December 31, 2021 and 2020, respectively.

Non-core items, and the related tax effect of each, in net income included merger and integration related expenses, Day 2 credit provision expense required under the CECL model, branch optimization costs, contract negotiation expenses and gains on other investments.  Non-core items negatively impacted earnings per diluted common share $0.58 for fourth quarter 2021, $0.76 for third quarter 2021, and $0.05 for fourth quarter 2020.  For the full year, non-core items negatively impacted diluted earnings per common share $1.13 for 2021 and $0.24 for 2020.

"As our fourth quarter numbers show, our financial and operating performance was strong. The successful integration of County showed that our team is adept at turning promises made into promises kept," said Mike Daniels, President and CEO of Nicolet. "We stretched the team with two acquisitions (County and Mackinac) in a short time, and they responded well. The acquisitions brought us more than increased assets and earnings.  They helped us add some good people and communities to the Nicolet family. We have great momentum heading into 2022, and our purpose to serve is resonating with our customers, employees, and the communities we serve.  We will continue to purposefully serve our 3 Circles - customers, employees, and shareholders, as we move forward. This focus has served us well for over twenty years."

On December 3, 2021, Nicolet completed its merger with County Bancorp, Inc. ("County"), pursuant to the terms of the definitive merger agreement dated June 22, 2021, at which time County merged with and into Nicolet, to become the premier agriculture lender throughout Wisconsin.  County shareholders received, at the election of each holder, either $37.18 in cash or 0.48 shares of Nicolet common stock, subject to proration procedures such that 1,237,000 shares of County common stock were exchanged for cash, and the remaining shares were exchanged for Nicolet common stock.  As a result, the total purchase price was $223 million, comprised of common stock consideration of $176 million from the issuance of approximately 2.4 million shares of Nicolet common stock and the remainder in cash consideration.  Upon consummation, County added total assets of $1.4 billion, loans of $1.0 billion, deposits of $1.0 billion, and preliminary goodwill of $70 million

On September 3, 2021, Nicolet completed its merger with Mackinac Financial Corporation ("Mackinac"), pursuant to the terms of the definitive merger agreement dated April 12, 2021, at which time Mackinac merged with and into Nicolet, expanding Nicolet prominently into Northern Michigan and the Upper Peninsula of Michigan, and adding to Nicolet's presence in upper northeastern Wisconsin.  Mackinac shareholders received fixed consideration of 0.22 shares of Nicolet common stock and $4.64 in cash for each share of Mackinac common stock owned, resulting in the issuance of 2.3 million shares of Nicolet common stock for stock consideration of $180 million and cash consideration of $49 million, or a total purchase price of $229 million.  Upon consummation, Mackinac added total assets of $1.5 billion, loans of $0.9 billion, deposits of $1.4 billion, and preliminary goodwill of $84 million.

Evaluation of financial performance and balance sheet line items was impacted by the timing and size of Nicolet's acquisitions of County and Mackinac.  Certain income statement results, average balances and related ratios for 2021 include partial contributions from County and Mackinac, each from the respective acquisition date.

"As for the full year numbers, the $61 million in GAAP earnings represents another record year for Nicolet. However, by adjusting the numbers for both the Mackinac and County deals, with $14 million of Day 2 CECL credit provisions required on better than projected asset quality metrics, $1 million related to our branch optimization strategy, and $6 million in integration and merger related expenses, the non-GAAP earnings of $73 million offers a better understanding of the economic value that we created in 2021," CEO Daniels added.

Executive Chairman of Nicolet Bob Atwell commented, "The excitement I observe as our bankers are out with our customers servicing the needs of our communities and all business lines working to fully integrate these last two acquisitions – that is the Nicolet Spirit and Culture fully engaged."  

Balance Sheet Review
At December 31, 2021, period end assets were $7.7 billion, an increase of $1.3 billion (20%) from September 30, 2021, largely due to the acquisition of County, which added $1.4 billion of assets at acquisition.  Total loans increased $1.1 billion from September 30, 2021, with County adding loans of $1.0 billion at acquisition.  Total deposits of $6.5 billion at December 31, 2021, increased $1.0 billion (19%) from September 30, 2021, largely due to the acquisition of County.  Total capital was $892 million at December 31, 2021, an increase of $163 million since September 30, 2021, mostly due to the acquisition of County. For the quarter ended December 31, 2021, Nicolet repurchased 345,166 shares at a total cost of $27.8 million, or an average per share cost of $80.49.

Compared to December 31, 2020, period end assets increased $3.1 billion (69%), largely due to the acquisitions of Mackinac and County.  Total loans increased $1.8 billion and total deposits increased $2.6 billion from December 31, 2020,  also largely due to the acquisitions of Mackinac and County.  Total capital was $892 million at December 31, 2021, an increase of $353 million since December 31, 2020, mostly due to the stock issued in the Mackinac and County acquisitions. For the year ended December 31, 2021, Nicolet repurchased 793,064 shares at a total cost of $61.5 million, or an average per share cost of $77.50.

During 2020, we originated 2,725 PPP loans totaling $351 million, bearing a 1% contractual rate, and earned a $12.3 million fee. During 2021, under the latest round of the SBA's program, Nicolet originated 2,205 PPP loans totaling $160 million and earned a $9.3 million fee. Of the total fees, $5.7 million was accreted into interest in 2020 and $15.2 million was accreted in 2021.  At December 31, 2021, the net carrying value of all remaining PPP loans was $25 million (1% of total loans), compared to $72 million (2% of total loans) at September 30, 2021, and $186 million (7% of total loans) at December 31, 2020, reflecting continued loan forgiveness.      

Asset Quality
Nonperforming assets were $56 million at December 31, 2021 consisting of $44 million of nonaccrual loans (largely comprised of County's previously identified nonaccrual ag loans) and $12 million of other real estate owned (primarily closed bank branch properties yet to be sold), and representing 0.73% of total assets, compared to $21 million or 0.33% at September 30, 2021, and $13 million or 0.29% at December 31, 2020.  Since the prior quarter, the allowance for credit losses-loans increased $11 million to $50 million, mostly due to the Day 2 allowance increase from the acquisition of County.  Compared to December 31, 2020, the allowance for credit losses-loans increased $17 million, with $14 million attributable to the Day 2 allowance increase from the Mackinac and County acquisitions.  At December 31, 2021, the allowance represented 1.07% of total loans.

Income Statement Review - Year
Net income for the year ended December 31, 2021 was $61 million, compared to net income of $60 million for the full year 2020.

Net interest income increased 22% to $158 million for the year ended December 31, 2021, the net of $22 million higher interest income and $6 million lower interest expense. The net interest margin for 2021 was 3.37%, down 1bp from 3.38% for 2020. The yield on interest-earning assets decreased 24bps (to 3.66%), due to the change in mix of interest-earnings assets (including a higher proportion of lower yielding cash assets) and continued PPP loan forgiveness, while the cost of funds decreased 32bps (to 0.43%) for full year 2021, attributable mainly to the change in mix of interest-bearing liabilities.

Average interest-earning assets of $4.7 billion for full year 2021 were up $870 million (23%) from full year 2020.  The higher average loans and investment securities were largely due to the timing of the Mackinac and County acquisitions, while the higher balances in other interest-earning assets (up $225 million, mostly cash) were due to the increased liquidity of businesses and consumers, resulting in a shift in the mix of average interest-earning assets.  Other interest-earning assets increased to 17% of total interest-earning assets for full year 2021 (compared to 15% for 2020), while the percentage of loans decreased to represent 67% of total interest-earning assets for 2021 (compared to 72% in the prior year) and investment securities increased to represent 16% of total interest-earning assets for 2021 (compared to 13% in 2020).  Average interest-bearing liabilities of $3.1 billion increased $480 million from 2020, mostly due to higher average interest-bearing deposits (up $623 million), partly offset by lower wholesale funding (mainly the early repayment of PPPLF in fourth quarter 2020).

Noninterest income was $67 million for full year 2021, up $5 million (8%) over full year 2020. Excluding net asset gains (losses), noninterest income for 2021 was $63 million, down $1 million compared to 2020.  Net mortgage income of $22 million remained strong in 2021, though slower than the record levels experienced in 2020. Trust services fee income and brokerage fee income combined increased $4 million (23%) over last year. Card interchange income grew $2 million (31%) to $9 million in 2021 due to higher volume and activity. Net asset gains for full year 2021 were $4 million (comprised primarily of market gains on equity investments), compared to net asset losses of $2 million for full year 2020 (mostly from $1 million market losses on equity investments and $1 million of net losses on branch other real estate owned write-downs).  

Noninterest expense of $129 million for full year 2021 increased $29 million (28%) over full year 2020. Personnel expense increased $13 million (24%) year over year, reflecting higher salaries from the larger employee base and merit increases between the years, as well as increased incentive compensation and fringe benefits.  Non-personnel expenses increased $15 million (35%) largely due to higher merger-related expense, increased occupancy, equipment and data processing costs for a larger operating base, as well as higher professional fees, director fees, and costs to carry closed bank branches.

Income Statement Review - Quarter
Net income for fourth quarter 2021 was $16 million, compared to net income of $8 million for third quarter 2021 and net income of $18 million for fourth quarter 2020.

Net interest income was $54 million for fourth quarter 2021, $18 million (52%) higher than third quarter 2021, the net of $19 million higher interest income and $1 million higher interest expense.  Average interest-earning assets of $5.9 billion were up $1.2 billion from third quarter 2021, with higher average loans (up $876 million, mostly due to the timing of the Mackinac and County acquisitions) and higher average investment securities (up $658 million, largely due to the re-investment of approximately $0.5 billion excess cash liquidity into U.S. Treasury securities of varying yields and durations), partly offset by lower balances in other interest-earning assets (down $345 million, mostly cash from the re-investment noted above), resulting in a shift in the mix of average interest-earning assets.  Other interest-earning assets decreased to 12% of total interest-earning assets for fourth quarter 2021 (compared to 22% for third quarter 2021), while the percentage of loans increased to represent 67% of total interest-earning assets for fourth quarter 2021 (compared to 65% in the prior quarter) and investment securities increased to represent 21% of total interest-earning assets for fourth quarter 2021 (compared to 13% in the prior quarter).  Average interest-bearing liabilities of $4.0 billion increased $913 million from third quarter 2021, mostly due to higher average interest-bearing deposits (up $885 million, mostly due to the timing of the Mackinac and County acquisitions). 

The net interest margin for fourth quarter 2021 was 3.57%, up 63bps from 2.94% for third quarter 2021. The yield on interest-earning assets increased 61bps (to 3.85%), due to the change in mix of interest-earnings assets (including a lower proportion of lower yielding cash assets), continued PPP loan forgiveness, and higher yield on all other loans (up 33bps from the prior quarter).  The cost of funds decreased 6bps (to 0.40%) for fourth quarter 2021, attributable mainly to the higher amount of low cost deposits.

Noninterest income was $16 million for fourth quarter 2021, up $2 million (15%) compared to third quarter 2021. Excluding net asset gains (losses), noninterest income was up slightly (3%) from third quarter 2021, largely due to higher card interchange volumes and service charges on deposit accounts.  Net mortgage income of $5 million remains strong, though continues to slow from the record levels experienced in 2020. Net asset gains were $0.5 million (comprised primarily of gains on asset sales), compared to net asset losses of $1 million in third quarter 2021 (comprised primarily of market losses on an equity investment).  

Noninterest expense of $39 million increased $6 million (19%) from third quarter 2021. Personnel expense increased $5 million (27%) from third quarter 2021, reflecting the larger employee base.  Non-personnel expenses increased $2 million (11%) largely due to higher occupancy and data processing expense of a larger operating base. 

About Nicolet Bankshares, Inc.
Nicolet Bankshares, Inc. is the bank holding company of Nicolet National Bank, a growing, full-service, community bank providing services ranging from commercial, agricultural and consumer banking to wealth management and retirement plan services. Founded in Green Bay in 2000, Nicolet National Bank operates branches in Northeast and Central Wisconsin, Northern Michigan and the upper peninsula of Michigan. More information can be found at www.nicoletbank.com.

Use of Non-GAAP Financial Measures
This communication contains non-GAAP financial measures, such as non-GAAP net income, non-GAAP earnings per  diluted common share, tangible book value per common share, return on average tangible common equity, and tangible common equity to tangible assets, where management believes such measures to be helpful to management, investors and others in understanding Nicolet's results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measures, as well as the reconciliation of the non-GAAP measures to the GAAP financial measures, are provided.  See "Reconciliation of Non-GAAP Financial Measures (Unaudited)" below. The non-GAAP net income measure and related reconciliation provide information useful to investors in understanding the operating performance and trends of Nicolet and also aid investors in comparing Nicolet's financial performance to the financial performance of peer banks.  Management considers non-GAAP financial ratios to be critical metrics with which to analyze and evaluate financial condition and capital strengths. While non-GAAP financial measures are frequently used by stakeholders in the evaluation of a corporation, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of results as reported under GAAP.

Forward Looking Statements "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995
Certain statements contained in this communication, which are not statements of historical fact, constitute forward-looking statements within the meaning of the federal securities law. Such statements include, but are not limited to, statements about Nicolet's business plans, objectives, expectations and intentions, including without limitation Nicolet's momentum heading into 2022 and business focus moving forward, all of which is subject to numerous assumptions, risks and uncertainties. Words or phrases such as "anticipate," "believe," "aim," "can," "conclude," "continue," "could," "estimate," "expect," "foresee," "goal," "intend," "may," "might," "outlook," "possible," "plan," "predict," "project," "potential," "seek," "should," "target," "will," "will likely," "would," or the negative of these terms or other comparable terminology, as well as similar expressions, are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements are not historical facts but instead express only management's beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management's control. It is possible that actual results and outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements. In addition to factors disclosed in reports filed by Nicolet with the SEC, risks and uncertainties that may cause actual results or outcomes to differ materially from those anticipated include, but are not limited to: (1) the possibility that any of the anticipated benefits of Nicolet's 2021 acquisitions of Mackinac and/or County will not be realized or will not be realized within the expected time period; (2) diversion of management's attention from ongoing business operations and opportunities due to the mergers; (3) the challenges of integrating and retaining key employees of Nicolet, including those who joined Nicolet from Mackinac and County; (4) the effect of the mergers on Nicolet's and/or Mackinac's or County's historic customer and employee relationships and operating results; (5) the magnitude and duration of the COVID pandemic and its impact on the global economy and financial market conditions and Nicolet's business, results of operations and financial condition; (6) changes in consumer demand for financial services; and (7) general competitive, economic, political and market conditions and fluctuations.  Please refer to Nicolet's Annual Report on Form 10-K for the year ended December 31, 2020, as well as its other filings with the SEC, for a more detailed discussion of risks, uncertainties and factors that could cause actual results to differ from those discussed in the forward-looking statements.

The COVID pandemic is adversely affecting us, our customers, counterparties, employees, and third-party service providers, and the ultimate extent of the impacts on our business, financial position, results of operations, liquidity, and prospects is uncertain. Continued deterioration in general business and economic conditions or turbulence in domestic financial markets could adversely affect Nicolet's revenues and the values of its assets and liabilities, lead to a tightening of credit, and increase stock price volatility. In addition, the COVID pandemic may result in changes to statutes, regulations, or regulatory policies or practices that could affect Nicolet in substantial and unpredictable ways.

All forward-looking statements included in this communication are made as of the date hereof and are based on information available to management at that time. Except as required by law, Nicolet does not assume any obligation to update any forward-looking statement to reflect events or circumstances that occur after the date the forward-looking statements were made.

 

Nicolet Bankshares, Inc.











Consolidated Balance Sheets (Unaudited)











(In thousands, except share data)


12/31/2021


09/30/2021


06/30/2021


03/31/2021


12/31/2020

Assets:











Cash and due from banks


$            209,349


$            217,608


$              77,634


$              61,295


$              88,460

Interest-earning deposits


385,943


1,132,997


714,772


674,559


714,399

Cash and cash equivalents


595,292


1,350,605


792,406


735,854


802,859

Certificates of deposit in other banks


21,920


24,079


23,387


27,296


29,521

Securities available for sale, at fair value


921,661


715,942


562,028


558,229


539,337

Securities held to maturity, at amortized cost


651,803


49,063




Other investments


44,008


38,602


33,440


28,248


27,619

Loans held for sale


6,447


16,784


11,235


16,883


21,450

Other assets held for sale


199,833


177,627




Loans


4,621,836


3,533,198


2,820,331


2,846,351


2,789,101

Allowance for credit losses - loans


(49,672)


(38,399)


(32,561)


(32,626)


(32,173)

Loans, net


4,572,164


3,494,799


2,787,770


2,813,725


2,756,928

Premises and equipment, net


94,566


83,513


61,618


59,413


59,944

Bank owned life insurance ("BOLI")


134,476


100,690


84,347


83,788


83,262

Goodwill and other intangibles, net


339,492


269,954


173,711


174,501


175,353

Accrued interest receivable and other assets


113,375


86,162


57,405


45,867


55,516

Total assets


$         7,695,037


$         6,407,820


$         4,587,347


$         4,543,804


$         4,551,789












Liabilities and Stockholders' Equity











Liabilities:











Noninterest-bearing demand deposits


$         1,975,705


$         1,852,119


$         1,324,994


$         1,216,477


$         1,212,787

Interest-bearing deposits


4,490,211


3,576,655


2,614,028


2,684,117


2,697,612

Total deposits


6,465,916


5,428,774


3,939,022


3,900,594


3,910,399

Short-term borrowings






Long-term borrowings


216,915


144,233


45,108


43,988


53,869

Other liabilities held for sale


51,586


47,496




Accrued interest payable and other liabilities


68,729


58,039


43,822


49,176


48,332

Total liabilities


6,803,146


5,678,542


4,027,952


3,993,758


4,012,600

Stockholders' Equity:











Common stock


140


120


98


100


100

Additional paid-in capital


575,045


425,367


261,096


271,388


273,390

Retained earnings


313,604


297,299


289,475


271,191


252,952

Accumulated other comprehensive income (loss)


3,102


6,492


8,726


7,367


12,747

Total Nicolet stockholders' equity


891,891


729,278


559,395


550,046


539,189

Total liabilities and  stockholders' equity


$         7,695,037


$         6,407,820


$         4,587,347


$         4,543,804


$         4,551,789












Common shares outstanding


13,994,079


11,952,438


9,843,141


9,987,897


10,011,342

 

Nicolet Bankshares, Inc.















Consolidated Statements of Income (Unaudited)













At or for the Three Months Ended


At or for the Years Ended

(In thousands, except per share data)


12/31/2021


09/30/2021


06/30/2021


03/31/2021


12/31/2020


12/31/2021


12/31/2020

Interest income:















Loans, including loan fees


$       52,292


$       35,294


$       35,111


$       33,862


$       34,781


$         156,559


$         136,372

Taxable investment securities


3,999


2,061


2,060


1,814


2,003


9,934


8,118

Tax-exempt investment securities


575


517


520


545


559


2,157


2,101

Other interest income


769


869


616


655


694


2,909


2,611

Total interest income


57,635


38,741


38,307


36,876


38,037


171,559


149,202

Interest expense:















Deposits


2,649


2,444


2,433


2,922


3,445


10,448


16,641

Short-term borrowings


1





1


1


66

Long-term borrowings


1,426


1,113


303


313


573


3,155


3,157

Total interest expense


4,076


3,557


2,736


3,235


4,019


13,604


19,864

Net interest income


53,559


35,184


35,571


33,641


34,018


157,955


129,338

Provision for credit losses


8,400


6,000



500


1,300


14,900


10,300

Net interest income after provision for credit losses


45,159


29,184


35,571


33,141


32,718


143,055


119,038

Noninterest income:















Trust services fee income


2,050


2,043


1,906


1,775


1,746


7,774


6,463

Brokerage fee income


3,205


3,154


2,991


2,793


2,673


12,143


9,753

Mortgage income, net


4,518


4,808


5,599


7,230


7,842


22,155


29,807

Service charges on deposit accounts


1,482


1,314


1,136


1,091


1,133


5,023


4,208

Card interchange income


2,671


2,299


2,266


1,927


1,922


9,163


6,998

BOLI income


722


572


559


527


936


2,380


2,710

Asset gains (losses), net


465


(1,187)


4,192


711


(620)


4,181


(1,805)

Other noninterest income


951


993


1,529


1,072


1,247


4,545


4,492

Total noninterest income


16,064


13,996


20,178


17,126


16,879


67,364


62,626

Noninterest expense:















Personnel expense


21,491


16,927


17,084


15,116


15,244


70,618


57,121

Occupancy, equipment and office


7,119


5,749


4,053


4,137


4,102


21,058


16,718

Business development and marketing


1,550


1,654


1,210


989


713


5,403


5,396

Data processing


3,582


2,939


2,811


2,658


2,921


11,990


10,495

Intangibles amortization


1,094


758


790


852


860


3,494


3,567

FDIC assessments


480


480


480


595


360


2,035


707

Merger-related expense


2,202


2,793


656



167


5,651


1,020

Other noninterest expense


1,890


1,761


3,663


1,734


1,000


9,048


5,695

Total noninterest expense


39,408


33,061


30,747


26,081


25,367


129,297


100,719

Income before income tax expense


21,815


10,119


25,002


24,186


24,230


81,122


80,945

Income tax expense


5,510


2,295


6,718


5,947


6,145


20,470


20,476

Net income


16,305


7,824


18,284


18,239


18,085


60,652


60,469

Net income attributable to noncontrolling interest






98



347

Net income attributable to Nicolet


$       16,305


$         7,824


$       18,284


$       18,239


$       17,987


$           60,652


$           60,122

Earnings per common share:















Basic


$           1.29


$           0.75


$           1.85


$           1.82


$           1.79


$               5.65


$               5.82

Diluted


$           1.25


$           0.73


$           1.77


$           1.75


$           1.74


$               5.44


$               5.70

Common shares outstanding:















Basic weighted average


12,626


10,392


9,902


9,998


10,074


10,736


10,337

Diluted weighted average


13,049


10,776


10,326


10,403


10,350


11,145


10,541

 

Nicolet Bankshares, Inc.















Consolidated Financial Summary (Unaudited)













At or for the Three Months Ended


At or for the Years Ended

(In thousands, except share & per share data)


12/31/2021


9/30/2021


6/30/2021


3/31/2021


12/31/2020


12/31/2021


12/31/2020

Selected Average Balances:















Loans


$ 3,952,330


$ 3,076,422


$ 2,869,105


$ 2,825,664


$ 2,868,827


$    3,183,681


$    2,787,587

Investment securities


1,269,562


611,870


537,632


528,342


520,867


738,540


490,209

Interest-earning assets


5,923,581


4,734,768


4,109,394


4,089,603


4,091,460


4,719,417


3,849,812

Cash and cash equivalents


839,607


1,100,153


716,873


750,075


714,031


852,603


584,159

Goodwill and other intangibles, net


294,051


201,748


174,026


174,825


175,678


211,463


168,802

Total assets


6,772,363


5,246,193


4,527,839


4,514,927


4,515,226


5,271,463


4,255,207

Deposits


5,754,778


4,448,468


3,897,797


3,875,205


3,793,430


4,499,087


3,439,748

Interest-bearing liabilities


4,006,307


3,093,031


2,684,871


2,764,232


2,744,578


3,140,393


2,660,508

Stockholders' equity (common)


784,666


608,946


550,974


544,541


537,920


622,903


527,428

Selected Ratios: (1)















Book value per common share


$      63.73


$      61.01


$      56.83


$      55.07


$      53.86


$          63.73


$          53.86

Tangible book value per common share (2)


$      39.47


$      38.43


$      39.18


$      37.60


$      36.34


$          39.47


$          36.34

Return on average assets


0.96 %


0.59 %


1.62 %


1.64 %


1.58 %


1.15 %


1.41 %

Return on average common equity


8.24


5.10


13.31


13.58


13.30


9.74


11.40

Return on average tangible common equity (2)


13.19


7.62


19.46


20.01


19.75


14.74


16.76

Average equity to average assets


11.59


11.61


12.17


12.06


11.91


11.82


12.39

Stockholders' equity to assets


11.59


11.38


12.19


12.11


11.85


11.59


11.85

Tangible common equity to tangible assets (2)


7.51


7.48


8.74


8.60


8.31


7.51


8.31

Net interest margin


3.57


2.94


3.45


3.31


3.29


3.37


3.38

Efficiency ratio


56.73


65.32


59.37


51.84


48.99


58.20


51.72

Effective tax rate


25.26


22.68


26.87


24.59


25.36


25.23


25.30

Selected Asset Quality Information:















Nonaccrual loans


$    44,154


$    16,715


$      6,932


$      8,965


$      9,455


$        44,154


$          9,455

Other real estate owned - closed branches


10,307


2,895


2,895


3,495


3,608


10,307


3,608

Other real estate owned


1,648


1,574



302



1,648


Nonperforming assets


$    56,109


$    21,184


$      9,827


$    12,762


$    13,063


$        56,109


$        13,063

Net loan charge-offs (recoveries)


$         (10)


$          58


$          65


$          47


$         515


$             160


$          1,384

Allowance for credit losses-loans to loans


1.07 %


1.09 %


1.15 %


1.15 %


1.15 %


1.07 %


1.15 %

Net loan charge-offs to average loans (1)


0.00


0.01


0.01


0.01


0.07


0.01


0.05

Nonperforming loans to total loans


0.96


0.47


0.25


0.31


0.34


0.96


0.34

Nonperforming assets to total assets


0.73


0.33


0.21


0.28


0.29


0.73


0.29

Stock Repurchase Information:















Common stock repurchased (dollars) (3)


$    27,784


$    17,125


$    12,453


$      4,102


$    12,909


$        61,464


$        40,544

Common stock repurchased (full shares) (3)


345,166


233,594


157,418


56,886


205,001


793,064


646,748

(1)

Income statement-related ratios for partial-year periods are annualized.

(2)

See Reconcilation of Non-GAAP Financial Measures below for a reconciliation of these financial measures.

(3)

Reflects common stock repurchased under board of director authorizations for the common stock repurchase program.

 

Nicolet Bankshares, Inc.












Net Interest Income and Net Interest Margin Analysis (Unaudited)


































At or for the Three Months Ended




December 31, 2021


September 30, 2021


December 31, 2020




Average




Average


Average




Average


Average




Average


(In thousands)


Balance


Interest


Rate


Balance


Interest


Rate


Balance


Interest


Rate


ASSETS




















PPP loans


$      46,694


$     5,549


46.50         %


$    109,318


$     2,310


8.27       %


$    282,736


$     3,799


5.26       %


Total loans ex PPP


3,905,636


46,770


4.70       %


2,967,104


33,001


4.37       %


2,586,091


31,005


4.71       %


Total loans (1) (2)


3,952,330


52,319


5.20       %


3,076,422


35,311


4.51       %


2,868,827


34,804


4.76       %


Investment securities (2)


1,269,562


4,860


1.53       %


611,870


2,805


1.83       %


520,867


2,799


2.15       %


Other interest-earning assets


701,689


769


0.43       %


1,046,476


869


0.33       %


701,766


694


0.39       %


Total interest-earning assets


5,923,581


$   57,948


3.85       %


4,734,768


$   38,985


3.24       %


4,091,460


$   38,297


3.68       %


Other assets, net


848,782






511,425






423,766






Total assets


$ 6,772,363






$ 5,246,193






$ 4,515,226






LIABILITIES AND STOCKHOLDERS' EQUITY














Interest-bearing core deposits


$ 3,456,699


$     1,743


0.20       %


$ 2,665,252


$     1,550


0.23       %


$ 2,285,858


$     2,269


0.39       %


Brokered deposits


377,390


906


0.95       %


284,164


894


1.25       %


320,237


1,176


1.46       %


Total interest-bearing deposits


3,834,089


2,649


0.27       %


2,949,416


2,444


0.33       %


2,606,095


3,445


0.53       %


PPPLF




0.00       %




0.00       %


72,582


64


0.35       %


Other interest-bearing liabilities


172,218


1,427


3.30       %


143,615


1,113


3.08       %


65,901


510


3.04       %


Total interest-bearing liabilities


4,006,307


$     4,076


0.40       %


3,093,031


$     3,557


0.46       %


2,744,578


$     4,019


0.58       %


Noninterest-bearing demand deposits


1,920,689






1,499,052






1,187,335






Other liabilities


60,701






45,164






45,393






Stockholders' equity


784,666






608,946






537,920






Total liabilities and stockholders' equity


$ 6,772,363






$ 5,246,193






$ 4,515,226






Net interest income and rate spread




$   53,872


3.45       %




$   35,428


2.78       %




$   34,278


3.10       %


Net interest margin






3.57       %






2.94       %






3.29       %
























At or for the Years Ended










December 31, 2021


December 31, 2020










Average




Average


Average




Average








(In thousands)


Balance


Interest


Rate


Balance


Interest


Rate








ASSETS




















PPP loans


$    141,510


$   16,672


11.78         %


$    220,544


$     8,062


3.66       %








Total loans ex PPP


3,042,171


139,972


4.60       %


2,567,043


128,419


5.00       %








Total loans (1) (2)


3,183,681


156,644


4.92       %


2,787,587


136,481


4.90       %








Investment securities (2)


738,540


13,047


1.77       %


490,209


11,079


2.26       %








Other interest-earning assets


797,196


2,909


0.36       %


572,016


2,611


0.46       %








Total interest-earning assets


4,719,417


$ 172,600


3.66       %


3,849,812


$ 150,171


3.90       %








Other assets, net


552,046






405,395












Total assets


$ 5,271,463






$ 4,255,207












LIABILITIES AND STOCKHOLDERS' EQUITY














Interest-bearing core deposits


$ 2,729,146


$     6,657


0.24       %


$ 2,124,634


$   12,163


0.57       %








Brokered deposits


308,091


3,791


1.23       %


289,489


4,478


1.55       %








Total interest-bearing deposits


3,037,237


10,448


0.34       %


2,414,123


16,641


0.69       %








PPPLF




0.00       %


161,634


571


0.35       %








Other interest-bearing liabilities


103,156


3,156


3.06       %


84,751


2,652


3.13       %








Total interest-bearing liabilities


3,140,393


$   13,604


0.43       %


2,660,508


$   19,864


0.75       %








Noninterest-bearing demand deposits


1,461,850






1,025,625












Other liabilities


46,317






41,646












Stockholders' equity


622,903






527,428












Total liabilities and stockholders' equity


$ 5,271,463






$ 4,255,207












Net interest income and rate spread




$ 158,996


3.23       %




$ 130,307


3.15       %








Net interest margin






3.37       %






3.38       %








(1)

Nonaccrual loans and loans held for sale are included in the daily average loan balances outstanding.

(2)

The yield on tax-exempt loans and tax-exempt investment securities is computed on a tax-equivalent basis using a federal tax rate of 21%, and adjusted for the disallowance of interest expense.

 

Nicolet Bankshares, Inc.















Reconciliation of Non-GAAP Financial Measures (Unaudited)













At or for the Three Months Ended


At or for the Years Ended

(In thousands, except per share data)


12/31/2021


9/30/2021


6/30/2021


3/31/2021


12/31/2020


12/31/2021


12/31/2020

Adjusted net income reconciliation: (1)















Net income attributable to Nicolet (GAAP)


$       16,305


$         7,824


$       18,284


$       18,239


$       17,987


$           60,652


$           60,122

Adjustments:















Provision expense related to merger


8,400


6,000





14,400


Assets (gains) losses, net


(465)


1,187


(4,192)


(711)


620


(4,181)


1,805

Merger-related expense


2,202


2,793


656



167


5,651


1,020

Branch closure expense



944





944


500

Adjustments subtotal


10,137


10,924


(3,536)


(711)


787


16,814


3,325

Tax on Adjustments (25%)


2,534


2,731


(884)


(178)


197


4,204


831

Adjustments, net of tax


7,603


8,193


(2,652)


(533)


590


12,611


2,494

Adjusted net income attributable to Nicolet (Non-GAAP)


$       23,908


$       16,017


$       15,632


$       17,706


$       18,577


$           73,263


$           62,616

Common shares outstanding:















Weighted average diluted common shares


13,049


10,776


10,326


10,403


10,350


11,145


10,541

Diluted earnings per common share:















Diluted earnings per common share (GAAP)


$           1.25


$           0.73


$           1.77


$          1.75


$           1.74


$               5.44


$               5.70

Adjusted Diluted earnings per common share (Non-GAAP)


$           1.83


$           1.49


$           1.51


$          1.70


$           1.79


$               6.57


$               5.94

Tangible assets: (2)















Total assets


$   7,695,037


$   6,407,820


$   4,587,347


$  4,543,804


$   4,551,789





Goodwill and other intangibles, net


339,492


269,954


173,711


174,501


175,353





Tangible assets


$   7,355,545


$   6,137,866


$   4,413,636


$  4,369,303


$   4,376,436





Tangible common equity: (2)















Stockholders' equity


$     891,891


$     729,278


$     559,395


$     550,046


$     539,189





Goodwill and other intangibles, net


339,492


269,954


173,711


174,501


175,353





Tangible common equity


$     552,399


$     459,324


$     385,684


$     375,545


$     363,836





Tangible average common equity: (2)















Average stockholders' equity (common)


$     784,666


$     608,946


$     550,974


$     544,541


$     537,920


$         622,903


$         527,428

Average goodwill and other intangibles, net


294,051


201,748


174,026


174,825


175,678


211,463


168,802

Average tangible common equity


$     490,615


$     407,198


$     376,948


$     369,716


$     362,242


$         411,440


$         358,626

(1)

The adjusted net income measure and related reconciliation provide information useful to investors in understanding the operating performance and trends of Nicolet and also to aid investors in the comparison of Nicolet's financial performance to the financial performance of peer banks.

(2)

The ratios of tangible book value per common share, return on average tangible common equity, and tangible common equity to tangible assets exclude goodwill and other intangibles, net.  These financial ratios have been included as they are considered to be critical metrics with which to analyze and evaluate financial condition and capital strength.

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/nicolet-bankshares-inc-announces-2021-earnings-301463214.html

SOURCE Nicolet Bankshares, Inc.

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