Item 5. Market for Registrant’s Common Equity
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTER S AND ISSUER PURCHASES OF EQUITY SECURITIES.
Market for Registrant’s Common Equity
Shares of the Company’s common stock are traded on the New York Stock Exchange (“NYSE”) under the symbol “NBHC”. The Company had 171 shareholders of record as of February 21, 2022. Management estimates that the number of beneficial owners is significantly greater.
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Performance Graph
The following graph presents a comparison of the Company’s performance to the indices named below. It assumes $100 invested on December 31, 2016, with dividends invested on a total return basis.
Period Ending
Index
12/31/16
12/31/17
12/31/18
12/31/19
12/31/20
12/31/21
NBHC
100.00
102.77
99.24
115.67
110.51
151.45
KBW Regional Banking Index
100.00
101.81
84.00
104.05
95.02
129.84
Russell 2000 Index
100.00
114.63
101.99
127.98
153.49
176.18
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The following table sets forth information about our repurchases of our common stock during the fourth quarter of 2021:
Maximum
Total number of
approximate dollar
shares purchased
value of shares
as part of publicly
that may yet be
Total number
Average price
announced plans
purchased under the
Period
of shares purchased
paid per share
or programs
plans or programs (3)
October 1 - October 31, 2021 (1)
5,102
$
42.91
—
$
55,640,399
November 1 - November 30, 2021 (2)
152,001
45.37
147,204
48,961,068
December 1 - December 31, 2021
237,795
43.49
237,795
38,618,179
Total
394,898
44.21
384,999
(1)
Represents shares purchased other than through publicly announced plans purchased pursuant to the Company’s stock incentive plans at the then current market value in satisfaction of stock option exercise prices, settlements of restricted stock and tax withholdings.
(2)
Of the shares repurchased in November 2021, 4,797 shares were purchased other than through publicly announced plans. These shares were purchased pursuant to the Company’s stock incentive plans at the then current market value in satisfaction of stock option exercise prices, settlements of restricted stock and tax withholdings.
(3)
On February 24, 2021, the Company’s Board of Directors authorized a new program to repurchase up to $75.0 million of the Company’s stock from time to time in either the open market or through privately negotiated transactions. The new program of $75.0 million replaced the previously authorized $50.0 million stock repurchase program announced in February 2020 in its entirety. The remaining authorization under the new program as of December 31, 2021 was $38.6 million.
Securities Authorized for Issuance under Equity Compensation Plans
During the second quarter of 2014, shareholders approved the 2014 Omnibus Incentive Plan (the “2014 Plan”). Under the 2014 Plan, the Compensation Committee of the Board of Directors has the authority to grant, from time to time, awards of options, stock appreciation rights, restricted stock, restricted stock units, performance units, other stock-based awards, or any combination thereof to eligible persons. As of December 31, 2021, the aggregate number of Company common stock available for issuance under the 2014 Plan was 4,048,761 shares.
During the second quarter of 2015, shareholders approved the Company’s 2014 Employee Stock Purchase Plan (“ESPP”). The ESPP allows employees to purchase shares of common stock through payroll deductions up to a limit of $25,000 per calendar year or 2,000 shares per offering period. The price an employee pays for shares is 90% of the fair market value of Company common stock on the last day of the offering period. As of December 31, 2021, the aggregate number of Company common stock available for issuance under the ESPP was 281,896 shares.
See note 16 to the consolidated financial statements for further detail related to these equity compensation plans.
Plan Category
Number of securities to be issued upon exercise of outstanding options, warrants and rights
Weighted-average exercise price of outstanding options, warrants and rights
Number of securities remaining available for future issuance under equity compensation plans
Equity plans approved by security holders
695,960
$
28.19
4,330,657
Equity plans not approved by security holders
—
—
—
Total
695,960
$
28.19
4,330,657
Item 6. SELECTED FINANCIAL DATA .
The following table sets forth a summary of selected historical financial information derived from our audited consolidated financial statements as of and for the five years ended December 31, 2021. This information should be read together with the related notes thereto as well as “Management’s Discussion and Analysis of Financial Condition and Results of Operations”
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included elsewhere in this annual report. Such information is not necessarily indicative of anticipated future results. All amounts are presented in thousands, except share and per share data, or as otherwise noted.
Summary of Selected Historical Consolidated Financial Data
Consolidated Statements of Financial Condition Data:
December 31,
December 31,
December 31,
December 31,
December 31,
2021
2020
2019
2018
2017
Cash and cash equivalents
$
845,695
$
605,565
$
110,190
$
109,556
$
257,364
Investment securities available-for-sale (at fair value)
691,847
661,955
638,249
791,102
855,345
Investment securities held-to-maturity
609,012
376,615
182,884
235,398
258,730
Non-marketable securities
50,740
16,493
29,751
27,555
15,030
Loans (1)
4,513,383
4,353,726
4,415,406
4,092,308
3,178,947
Allowance for credit losses
(49,694)
(59,777)
(39,064)
(35,692)
(31,264)
Loans, net
4,463,689
4,293,949
4,376,342
4,056,616
3,147,683
Loans held for sale
139,142
247,813
117,444
48,120
4,629
Other real estate owned
7,005
4,730
7,300
10,596
10,491
Premises and equipment, net
96,747
106,982
112,151
109,986
93,708
Goodwill and other intangible assets, net
127,349
132,955
126,388
128,497
61,237
Other assets
182,785
212,893
194,813
159,240
139,248
Total assets
$
7,214,011
$
6,659,950
$
5,895,512
$
5,676,666
$
4,843,465
Deposits
$
6,228,173
$
5,676,232
$
4,737,132
$
4,535,621
$
3,979,559
Long-term debt, net
39,478
—
—
—
—
Other liabilities
106,254
163,027
391,460
446,039
331,499
Total liabilities
6,373,905
5,839,259
5,128,592
4,981,660
4,311,058
Total shareholders’ equity
840,106
820,691
766,920
695,006
532,407
Total liabilities and shareholders’ equity
$
7,214,011
$
6,659,950
$
5,895,512
$
5,676,666
$
4,843,465
(1)
Total loans are net of unearned discounts and deferred fees and costs.
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Consolidated Statements of Operations Data:
As of and for the years ended
December 31,
December 31,
December 31,
December 31,
December 31,
2021
2020
2019
2018
2017
Interest income
$
200,965
$
218,002
$
242,601
$
221,391
$
164,421
Interest expense
13,821
25,056
36,771
23,954
18,115
Net interest income
187,144
192,946
205,830
197,437
146,306
Provision (release) expense for loan losses
(9,293)
17,630
11,643
5,197
12,972
Net interest income after provision for loan losses
196,437
175,316
194,187
192,240
133,334
Non-interest income
110,364
140,258
82,752
70,775
39,205
Non-interest expense
191,830
206,177
180,745
189,334
136,677
Income before income taxes
114,971
109,397
96,194
73,681
35,862
Income tax expense
21,365
20,806
15,829
12,230
21,283
Net income
$
93,606
$
88,591
$
80,365
$
61,451
$
14,579
Share Information:
Earnings per share, basic
$
3.04
$
2.87
$
2.57
$
2.00
$
0.54
Earnings per share, diluted
3.01
2.85
2.55
1.95
0.53
Dividends paid
0.87
0.80
0.75
0.54
0.34
Book value per share
28.04
26.79
24.60
22.59
19.81
Tangible common book value per share (1)
24.33
23.09
20.89
18.77
17.94
Total shareholders' equity to total assets
11.65%
12.32%
13.01%
12.24%
10.99%
Tangible common equity to tangible assets (1)
10.26%
10.80%
11.27%
10.39%
10.06%
Weighted average common shares outstanding, basic
30,727,566
30,857,086
31,175,825
30,748,234
26,928,763
Weighted average common shares outstanding, diluted
31,068,159
31,075,857
31,530,817
31,430,074
27,709,659
Common shares outstanding
29,958,764
30,634,291
31,176,627
30,769,063
26,875,585
(1)
Tangible book value per share and tangible common equity to tangible assets are non-GAAP financial measures. We believe that the most directly comparable GAAP financial measures are book value per share and total shareholders’ equity to total assets. See the reconciliation under “About Non-GAAP Financial Measures.”
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Key Ratios
As of and for the years ended
December 31,
December 31,
December 31,
December 31,
December 31,
2021
2020
2019
2018
2017
Return on average assets
1.33%
1.40%
1.38%
1.10%
0.31%
Return on average tangible assets (1)
1.37%
1.44%
1.42%
1.15%
0.38%
Return on average equity
11.06%
11.24%
10.89%
9.28%
2.67%
Return on average tangible common equity (1)
12.87%
13.27%
13.07%
11.60%
3.61%
Loan to deposit ratio (end of period)
72.47%
76.70%
93.21%
90.23%
80.00%
Non-interest bearing deposits to total deposits (end of period)
40.24%
37.19%
25.01%
23.64%
22.68%
Net interest margin (2)
2.87%
3.33%
3.83%
3.85%
3.36%
Net interest margin FTE (1)(2)(3)
2.95%
3.42%
3.93%
3.93%
3.50%
Interest rate spread FTE (3)(4)
2.79%
3.21%
3.65%
3.77%
3.35%
Yield on earning assets (5)
3.08%
3.76%
4.52%
4.31%
3.78%
Yield on earning assets FTE (1)(2)(3)
3.16%
3.85%
4.61%
4.40%
3.91%
Cost of interest bearing liabilities
0.37%
0.64%
0.96%
0.63%
0.56%
Cost of deposits
0.23%
0.45%
0.64%
0.45%
0.41%
Non-interest income to total revenue FTE (3)
36.46%
41.46%
28.18%
25.95%
20.49%
Non-interest expense to average assets
2.73%
3.26%
3.10%
3.38%
2.90%
Efficiency ratio
64.08%
61.52%
62.22%
69.78%
70.80%
Efficiency ratio FTE (1)(3)
62.99%
60.59%
61.15%
68.64%
68.63%
Total Loans Asset Quality Data (6)(7)(8)
Non-performing loans to total loans
0.24%
0.47%
0.49%
0.60%
0.66%
Non-performing loans to total loans excluding PPP loans
0.24%
0.49%
0.49%
0.60%
0.66%
Non-performing assets to total loans and OREO
0.39%
0.58%
0.66%
0.85%
0.99%
Non-performing assets to total loans and OREO excluding PPP loans
0.40%
0.60%
0.66%
0.85%
0.99%
Allowance for credit losses to total loans
1.10%
1.37%
0.88%
0.87%
0.98%
Allowance for credit losses to total loans excluding PPP loans
1.11%
1.43%
0.88%
0.87%
0.98%
Allowance for credit losses to non-performing loans
458.77%
293.21%
179.62%
145.94%
148.88%
Net charge-offs to average loans
0.03%
0.06%
0.19%
0.02%
0.36%
(1)
Ratio represents a non-GAAP financial measure. See non-GAAP reconciliation below.
(2)
Net interest margin represents net interest income, including accretion income on interest earning assets, as a percentage of average interest earning assets.
(3)
Presented on a fully taxable equivalent (“FTE”) basis using the statutory rate of 21% for 2021, 2020, 2019 and 2018 and 35% for 2017. The taxable equivalent adjustments included above are $5,161, $5,103, $5,065, $4,482 and $5,852 for the years ended 2021, 2020, 2019, 2018, and 2017, respectively.
(4)
Interest rate spread represents the difference between the weighted average yield on interest earning assets and the weighted average cost of interest bearing liabilities.
(5)
Interest earning assets include assets that earn interest/accretion or dividends. Any market value adjustments on investment securities or loans are excluded from interest-earning assets.
(6)
Non-performing loans consist of non-accruing loans and restructured loans on non-accrual.
(7)
Non-performing assets include non-performing loans, other real estate owned and other repossessed assets.
(8)
Total loans are net of unearned discounts and fees.
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About Non-GAAP Financial Measures
Certain of the financial measures and ratios we present, including “tangible assets,” “return on average tangible assets,” “return on average tangible common equity,” “tangible common book value,” “tangible common book value per share,” “tangible common equity,” “tangible common equity to tangible assets,” and “fully taxable equivalent (FTE)” metrics, are supplemental measures that are not required by, or are not presented in accordance with, U.S. generally accepted accounting principles (GAAP). We refer to these financial measures and ratios as “non-GAAP financial measures.” We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision making and useful in evaluating period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenses or assets that we believe are not indicative of our primary business operating results or by presenting certain metrics on an FTE basis. We believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing and comparing past, present and future periods.
These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and you should not rely on non-GAAP financial measures alone as measures of our performance. The non-GAAP financial measures we present may differ from non-GAAP financial measures used by our peers or other companies. We compensate for these limitations by providing the equivalent GAAP measures whenever we present the non-GAAP financial measures and by including a reconciliation of the impact of the components adjusted for in the non-GAAP financial measure so that both measures and the individual components may be considered when analyzing our performance.
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A reconciliation of our GAAP financial measures to the comparable non-GAAP financial measures is as follows:
Tangible Common Book Value Ratios
December 31,
December 31,
December 31,
December 31,
December 31,
2021
2020
2019
2018
2017
Total shareholders’ equity
$
840,106
$
820,691
$
766,920
$
695,006
$
532,407
Less: goodwill and core deposit intangible assets, net
(121,392)
(122,575)
(123,758)
(124,941)
(61,237)
Add: deferred tax liability related to goodwill
10,070
9,155
8,241
7,327
10,873
Tangible common equity (non-GAAP)
$
728,784
$
707,271
$
651,403
$
577,392
$
482,043
Total assets
$
7,214,011
$
6,659,950
$
5,895,512
$
5,676,666
$
4,843,465
Less: goodwill and core deposit intangible assets, net
(121,392)
(122,575)
(123,758)
(124,941)
(61,237)
Add: deferred tax liability related to goodwill
10,070
9,155
8,241
7,327
10,873
Tangible assets (non-GAAP)
$
7,102,689
$
6,546,530
$
5,779,995
$
5,559,052
$
4,793,101
Tangible common equity to tangible assets calculations:
Total shareholders' equity to total assets
11.65%
12.32%
13.01%
12.24%
10.99%
Less: impact of goodwill and core deposit intangible assets, net
(1.39)%
(1.52)%
(1.74)%
(1.85)%
(0.93)%
Tangible common equity to tangible assets (non-GAAP)
10.26%
10.80%
11.27%
10.39%
10.06%
Tangible common book value per share calculations:
Tangible common equity (non-GAAP)
$
728,784
$
707,271
$
651,403
$
577,392
$
482,043
Divided by: ending shares outstanding
29,958,764
30,634,291
31,176,627
30,769,063
26,875,585
Tangible common book value per share (non-GAAP)
$
24.33
$
23.09
$
20.89
$
18.77
$
17.94
Tangible common book value per share, excluding accumulated other comprehensive loss (income) calculations:
Tangible common equity (non-GAAP)
$
728,784
$
707,271
$
651,403
$
577,392
$
482,043
Accumulated other comprehensive loss (income), net of tax
6,963
(9,766)
(2,062)
11,275
6,242
Tangible common book value, excluding accumulated other comprehensive loss (income), net of tax (non-GAAP)
735,747
697,505
649,341
588,667
488,285
Divided by: ending shares outstanding
29,958,764
30,634,291
31,176,627
30,769,063
26,875,585
Tangible common book value per share, excluding accumulated other comprehensive loss (income), net of tax (non-GAAP)
$
24.56
$
22.77
$
20.83
$
19.13
$
18.17
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Return on Average Tangible Assets and Return on Average Tangible Equity
As of and for the years ended
December 31,
December 31,
December 31,
December 31,
December 31,
2021
2020
2019
2018
2017
Net income
$
93,606
$
88,591
$
80,365
$
61,451
$
14,579
Add: impact of core deposit intangible amortization expense, after tax
909
910
899
1,649
3,259
Net income adjusted for impact of core deposit intangible amortization expense, after tax
$
94,515
$
89,501
$
81,264
$
63,100
$
17,838
Average assets
$
7,020,111
$
6,326,268
$
5,837,121
$
5,607,532
$
4,705,241
Less: average goodwill and core deposit intangible asset, net of deferred tax liability related to goodwill
(111,944)
(114,031)
(116,104)
(118,546)
(52,958)
Average tangible assets (non-GAAP)
$
6,908,167
$
6,212,237
$
5,721,017
$
5,488,986
$
4,652,283
Average shareholders' equity
$
846,539
$
788,286
$
737,923
$
662,420
$
546,716
Less: average goodwill and core deposit intangible asset, net of deferred tax liability related to goodwill
(111,944)
(114,031)
(116,104)
(118,546)
(52,958)
Average tangible common equity (non-GAAP)
$
734,595
$
674,255
$
621,819
$
543,874
$
493,758
Return on average assets
1.33%
1.40%
1.38%
1.10%
0.31%
Return on average tangible assets (non-GAAP)
1.37%
1.44%
1.42%
1.15%
0.38%
Return on average equity
11.06%
11.24%
10.89%
9.28%
2.67%
Return on average tangible common equity (non-GAAP)
12.87%
13.27%
13.07%
11.60%
3.61%
Fully Taxable Equivalent Yield on Earning Assets and Net Interest Margin
As of and for the years ended
December 31,
December 31,
December 31,
December 31,
December 31,
2021
2020
2019
2018
2017
Interest income
$
200,965
$
218,002
$
242,601
$
221,391
$
164,421
Add: impact of taxable equivalent adjustment
5,161
5,103
5,065
4,482
5,852
Interest income FTE (non-GAAP)
$
206,126
$
223,105
$
247,666
$
225,873
$
170,273
Net interest income
$
187,144
$
192,946
$
205,830
$
197,437
$
146,306
Add: impact of taxable equivalent adjustment
5,161
5,103
5,065
4,482
5,852
Net interest income FTE (non-GAAP)
$
192,305
$
198,049
$
210,895
$
201,919
$
152,158
Average earning assets
$
6,521,300
$
5,795,864
$
5,368,073
$
5,131,694
$
4,353,320
Yield on earning assets
3.08%
3.76%
4.52%
4.31%
3.78%
Yield on earning assets FTE (non-GAAP)
3.16%
3.85%
4.61%
4.40%
3.91%
Net interest margin
2.87%
3.33%
3.83%
3.85%
3.36%
Net interest margin FTE (non-GAAP)
2.95%
3.42%
3.93%
3.93%
3.50%
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Efficiency Ratio
As of and for the years ended
December 31,
December 31,
December 31,
December 31,
December 31,
2021
2020
2019
2018
2017
Net interest income
$
187,144
$
192,946
$
205,830
$
197,437
$
146,306
Add: impact of taxable equivalent adjustment
5,161
5,103
5,065
4,482
5,852
Net interest income, FTE (non-GAAP)
$
192,305
$
198,049
$
210,895
$
201,919
$
152,158
Non-interest income
$
110,364
$
140,258
$
82,752
$
70,775
$
39,205
Non-interest expense
$
191,830
$
206,177
$
180,745
$
189,334
$
136,677
Less: core deposit intangible asset amortization
(1,183)
(1,183)
(1,183)
(2,170)
(5,342)
Non-interest expense, adjusted for core deposit intangible asset amortization (non-GAAP)
$
190,647
$
204,994
$
179,562
$
187,164
$
131,335
Efficiency ratio
64.08%
61.52%
62.22%
69.78%
70.80%
Efficiency ratio FTE (non-GAAP)
62.99%
60.59%
61.15%
68.64%
68.63%
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.