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HBT Financial, Inc. Announces Third Quarter 2023 Financial Results
ソース: Nasdaq GlobeNewswire / 23 10 2023 05:05:02 America/Chicago
Third Quarter Highlights
- Net income of $19.7 million, or $0.62 per diluted share; return on average assets (ROAA) of 1.58%; return on average stockholders' equity (ROAE) of 17.02%; and return on average tangible common equity (ROATCE)(1) of 20.70%
- Adjusted net income(1) of $20.3 million; or $0.63 per diluted share; adjusted ROAA(1) of 1.62%; adjusted ROAE(1) of 17.51%; and adjusted ROATCE(1) of 21.29%
- Asset quality remained strong with nonperforming assets to total assets of 0.16%
- Net interest margin of 4.07% and net interest margin (tax-equivalent basis)(1) of 4.13%
BLOOMINGTON, Ill., Oct. 23, 2023 (GLOBE NEWSWIRE) -- HBT Financial, Inc. (NASDAQ: HBT) (the “Company” or “HBT Financial” or “HBT”), the holding company for Heartland Bank and Trust Company, today reported net income of $19.7 million, or $0.62 diluted earnings per share, for the third quarter of 2023. This compares to net income of $18.5 million, or $0.58 diluted earnings per share, for the second quarter of 2023, and net income of $15.6 million, or $0.54 diluted earnings per share, for the third quarter of 2022.
J. Lance Carter, President and Chief Executive Officer of HBT Financial, said, “This was another strong quarter of profitability with a ROAA of 1.58%, a ROATCE of 20.70%, and our highest quarterly diluted earnings per share since our IPO in October of 2019. Our balance sheet strength continues to show with our core deposit franchise allowing us to maintain a low cost of funds of 0.96% and credit quality remaining solid with nonperforming assets at only 0.16% of total assets. Our net interest margin remained very solid at 4.13% on a tax-equivalent basis(1) as loan growth and asset mix improvement continue to partially offset funding cost increases. We have continued to maintain our consistently conservative underwriting standards while also increasing loans by 3% during the quarter. In addition, our loan portfolio remains very well diversified with limited exposure to higher risk segments, such as office commercial real estate. Despite a decrease in accumulated other comprehensive income (loss) due to rising interest rates during the quarter, we were able to increase all capital measures and maintain a strong capital base providing us with flexibility for future capital deployment. We believe our consistent financial performance will enable us to continue enhancing the value of our franchise.”
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(1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
comparable GAAP financial measures.Adjusted Net Income
In addition to reporting GAAP results, the Company believes non-GAAP measures such as adjusted net income and adjusted earnings per share, which adjust for acquisition expenses, branch closure expenses, gains (losses) on sale of closed branch premises, net earnings (losses) from closed or sold operations, charges related to termination of certain employee benefit plans, realized gains (losses) on sales of securities, and mortgage servicing rights fair value adjustments, provide investors with additional insight into its operational performance. The Company reported adjusted net income of $20.3 million, or $0.63 adjusted diluted earnings per share, for the third quarter of 2023. This compares to adjusted net income of $18.8 million, or $0.58 adjusted diluted earnings per share, for the second quarter of 2023, and adjusted net income of $15.9 million, or $0.55 adjusted diluted earnings per share, for the third quarter of 2022 (see "Reconciliation of Non-GAAP Financial Measures" tables below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures).
Net Interest Income and Net Interest Margin
Net interest income for the third quarter of 2023 was $48.3 million, a slight decrease from $48.9 million for the second quarter of 2023. The decrease was primarily attributable to an increase in funding costs which were largely offset by higher yields on loans and a more favorable interest-earning asset mix.
Relative to the third quarter of 2022, net interest income increased 29.1% from $37.4 million. The increase was primarily attributable to the increase in average interest-earning assets following the Town and Country Financial Corporation (“Town and Country”) merger completed in the first quarter of 2023 and higher yields on interest-earning assets.
Net interest margin for the third quarter of 2023 was 4.07%, compared to 4.16% for the second quarter of 2023, and net interest margin (tax-equivalent basis)(1) for the third quarter of 2023 was 4.13% compared to 4.22% for the second quarter of 2023. The decrease was primarily attributable to higher funding costs with the cost of funds increasing to 0.96% for the third quarter of 2023, compared to 0.71% for the second quarter of 2023, partially offset by higher yields on loans and a more favorable interest-earning asset mix.
Relative to the third quarter of 2022, net interest margin increased from 3.65%. This increase was primarily attributable to higher yields on interest-earning assets.
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(1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
comparable GAAP financial measures.Noninterest Income
Noninterest income for the third quarter of 2023 was $9.5 million, a decrease of 4.3% from $9.9 million for the second quarter of 2023. The decrease was primarily attributable to $0.8 million of losses realized on the sale of debt securities during the third quarter of 2023 which were not present in the second quarter of 2023 results. Partially offsetting these losses was a $0.6 million gain on sale of foreclosed assets compared to a $0.1 million loss included in the second quarter of 2023 results.
Relative to the third quarter of 2022, noninterest income increased 15.3% from $8.2 million. The increase was primarily attributable to the Town and Country merger completed in the first quarter of 2023 which contributed to a $0.5 million increase in mortgage servicing income, a $0.3 million increase in wealth management fees, and a $0.2 million increase in card income.
Noninterest Expense
Noninterest expense for the third quarter of 2023 was $30.7 million, a 9.7% decrease from $34.0 million for the second quarter of 2023. The decrease was primarily attributable to the realization of planned cost reductions following the Town and Country core system conversion completed in April 2023. Additionally, the absence of $0.8 million of legal fees and $0.8 million of accruals related to pending legal matters previously disclosed during the second quarter of 2023 further contributed to the decrease in noninterest expense during the third quarter of 2023.
Relative to the third quarter of 2022, noninterest expense increased 27.8% from $24.0 million, primarily attributable to the addition of Town and Country’s operations.
Acquisition-related expenses recognized are summarized below. No acquisition-related expenses were recognized subsequent to the second quarter of 2023, and we do not expect material acquisition-related expenses related to Town and Country in subsequent quarters.
Three Months Ended Nine Months Ended
September 30,(dollars in thousands) September
30,
2023June 30,
2023September
30,
20222023 2022 PROVISION FOR CREDIT LOSSES $ — $ — $ — $ 5,924 $ — NONINTEREST EXPENSE Salaries — 66 — 3,584 — Furniture and equipment — 39 — 39 — Data processing — 176 — 2,031 — Marketing and customer relations — 10 — 24 — Loan collection and servicing — 125 — 125 — Legal fees and other noninterest expense — 211 462 1,964 462 Total noninterest expense — 627 462 7,767 462 Total acquisition-related expenses $ — $ 627 $ 462 $ 13,691 $ 462 Loan Portfolio
Total loans outstanding, before allowance for credit losses, were $3.34 billion at September 30, 2023, compared with $3.24 billion at June 30, 2023 and $2.58 billion at September 30, 2022. The $98.1 million increase from June 30, 2023 was primarily attributable to draws on existing construction projects and new fundings to primarily existing customers, in part driven by seasonally higher agricultural line of credit usage. Balance increases in the commercial real estate - non-owner occupied and multi-family categories were driven predominately by the completion of projects previously in the construction and land development category.
Deposits
Total deposits were $4.20 billion at September 30, 2023, compared with $4.16 billion at June 30, 2023 and $3.64 billion at September 30, 2022. The $33.5 million increase from June 30, 2023 was primarily attributable to a $64.0 million increase in brokered deposits, partially offset by decreases in balances held in mainly smaller balance accounts.
Asset Quality
Nonperforming loans totaled $6.7 million, or 0.20% of total loans, at September 30, 2023, compared with $7.5 million, or 0.23% of total loans, at June 30, 2023, and $3.2 million, or 0.12% of total loans, at September 30, 2022. Additionally, of the $6.7 million of nonperforming loans held as of September 30, 2023, $2.0 million is either wholly or partially guaranteed by the U.S. Government. The $0.9 million decrease in nonperforming loans from June 30, 2023 was primarily attributable to reductions as the result of foreclosures and charge-offs on several smaller credits.
The Company recorded a provision for credit losses of $0.5 million for the third quarter of 2023. The provision for credit losses primarily reflects a $0.9 million increase in required reserves driven by growth of the loan portfolio, a $0.8 million increase in required reserves resulting from changes in economic and qualitative factors, a $0.8 million decrease in reserves on debt securities available-for-sale, a $0.5 million decrease in specific reserve, and net recoveries of $0.1 million.
The Company had net recoveries of $0.1 million, or 0.01% of average loans on an annualized basis, for the third quarter of 2023, compared to net recoveries of $0.1 million, or 0.01% of average loans on an annualized basis, for the second quarter of 2023, and net charge-offs of $0.1 million, or 0.01% of average loans on an annualized basis, for the third quarter of 2022.
The Company’s allowance for credit losses was 1.16% of total loans and 582% of nonperforming loans at September 30, 2023, compared with 1.17% of total loans and 502% of nonperforming loans at June 30, 2023. In addition, the allowance for credit losses on unfunded lending-related commitments totaled $4.4 million as of September 30, 2023.
Stock Repurchase Program
During the third quarter of 2023, the Company repurchased 91,728 shares of its common stock at a weighted average price of $18.48 under its stock repurchase program. The Company’s Board of Directors have authorized the repurchase of up to $15 million of HBT Financial common stock under its stock repurchase program in effect until January 1, 2024. As of September 30, 2023, the Company had $7.6 million remaining under the current stock repurchase authorization.
About HBT Financial, Inc.
HBT Financial, Inc., headquartered in Bloomington, Illinois, is the holding company for Heartland Bank and Trust Company, and has banking roots that can be traced back to 1920. HBT provides a comprehensive suite of business, commercial, wealth management, and retail banking products and services to individuals, businesses and municipal entities throughout Illinois and Eastern Iowa through 67 full-service branches. As of September 30, 2023, HBT had total assets of $5.0 billion, total loans of $3.3 billion, and total deposits of $4.2 billion.
Non-GAAP Financial Measures
Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with GAAP. These non-GAAP financial measures include net interest income (tax-equivalent basis), net interest margin (tax-equivalent basis), efficiency ratio (tax-equivalent basis), tangible common equity to tangible assets, tangible book value per share, return on average tangible common equity, adjusted net income, adjusted earnings per share, adjusted return on average assets, adjusted return on average stockholders' equity, and adjusted return on average tangible common equity. Our management uses these non-GAAP financial measures, together with the related GAAP financial measures, in its analysis of our performance and in making business decisions. Management believes that it is a standard practice in the banking industry to present these non-GAAP financial measures, and accordingly believes that providing these measures may be useful for peer comparison purposes. These disclosures should not be viewed as substitutes for the results determined to be in accordance with GAAP; nor are they necessarily comparable to non-GAAP financial measures that may be presented by other companies. See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures in the "Reconciliation of Non-GAAP Financial Measures" tables.
Forward-Looking Statements
Readers should note that in addition to the historical information contained herein, this press release contains, and future oral and written statements of the Company and its management may contain, "forward-looking statements" within the meanings of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "will," "propose," "may," "plan," "seek," "expect," "intend," "estimate," "anticipate," "believe," "continue," or “should,” or similar terminology. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.
Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to: (i) the strength of the local, state, national and international economies (including effects of inflationary pressures and supply chain constraints); (ii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics (including the COVID-19 pandemic in the United States), acts of war or other threats thereof (including the Israeli-Palestinian conflict and the Russian invasion of Ukraine), or other adverse external events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies, the FASB or the PCAOB (including the Company’s adoption of the current expected credit losses (“CECL”) methodology); (iv) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business and any changes in response to the recent failures of other banks; (v) changes in interest rates and prepayment rates of the Company’s assets (including the impact of LIBOR phase-out and the recent and potential additional rate increases by the Federal Reserve); (vi) increased competition in the financial services sector, including from non-bank competitors such as credit unions and “fintech” companies, and the inability to attract new customers; (vii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (viii) unexpected results of acquisitions, which may include failure to realize the anticipated benefits of acquisitions and the possibility that transaction costs may be greater than anticipated; (ix) the loss of key executives or employees; (x) changes in consumer spending; (xi) unexpected outcomes of existing or new litigation involving the Company; (xii) the economic impact of exceptional weather occurrences such as tornadoes, floods and blizzards; (xiii) fluctuations in the value of securities held in our securities portfolio; (xiv) concentrations within our loan portfolio, large loans to certain borrowers, and large deposits from certain clients; (xv) the concentration of large deposits from certain clients who have balances above current FDIC insurance limits and may withdraw deposits to diversify their exposure; (xvi) the level of non-performing assets on our balance sheets; (xvii) interruptions involving our information technology and communications systems or third-party servicers; (xviii) breaches or failures of our information security controls or cybersecurity-related incidents, and (xix) the ability of the Company to manage the risks associated with the foregoing as well as anticipated. Readers should note that the forward-looking statements included in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.
CONTACT:
Peter Chapman
HBTIR@hbtbank.com
(309) 664-4556HBT Financial, Inc. Unaudited Consolidated Financial Summary As of or for the Three Months Ended Nine Months Ended September 30, (dollars in thousands, except per share data) September 30,
2023June 30,
2023September 30,
20222023 2022 Interest and dividend income $ 59,041 $ 56,768 $ 39,014 $ 167,588 $ 108,106 Interest expense 10,762 7,896 1,624 23,600 4,415 Net interest income 48,279 48,872 37,390 143,988 103,691 Provision for credit losses 480 (230 ) 386 6,460 (53 ) Net interest income after provision for credit losses 47,799 49,102 37,004 137,528 103,744 Noninterest income 9,490 9,914 8,234 26,841 26,828 Noninterest expense 30,671 33,973 23,998 100,577 71,997 Income before income tax expense 26,618 25,043 21,240 63,792 58,575 Income tax expense 6,903 6,570 5,613 16,396 15,259 Net income $ 19,715 $ 18,473 $ 15,627 $ 47,396 $ 43,316 Earnings per share - Diluted $ 0.62 $ 0.58 $ 0.54 $ 1.49 $ 1.49 Adjusted net income (1) $ 20,279 $ 18,772 $ 15,856 $ 58,910 $ 41,919 Adjusted earnings per share - Diluted (1) 0.63 0.58 0.55 1.86 1.45 Book value per share $ 14.36 $ 14.15 $ 12.49 Tangible book value per share (1) 11.80 11.58 11.43 Shares of common stock outstanding 31,774,140 31,865,868 28,752,626 Weighted average shares of common stock
outstanding31,829,250 31,980,133 28,787,662 31,598,650 28,887,757 SUMMARY RATIOS Net interest margin * 4.07 % 4.16 % 3.65 % 4.14 % 3.36 % Net interest margin (tax-equivalent basis) * (1)(2) 4.13 4.22 3.72 4.20 3.41 Efficiency ratio 51.85 % 56.57 % 52.07 % 57.73 % 54.60 % Efficiency ratio (tax-equivalent basis) (1)(2) 51.25 55.89 51.31 57.04 53.86 Loan to deposit ratio 79.63 % 77.91 % 70.81 % Return on average assets * 1.58 % 1.49 % 1.47 % 1.29 % 1.35 % Return on average stockholders' equity * 17.02 16.30 16.27 14.22 14.91 Return on average tangible common equity * (1) 20.70 19.91 17.70 17.17 16.20 Adjusted return on average assets * (1) 1.62 % 1.51 % 1.49 % 1.61 % 1.31 % Adjusted return on average stockholders' equity * (1) 17.51 16.57 16.51 17.68 14.43 Adjusted return on average tangible common equity *
(1)21.29 20.23 17.96 21.34 15.67 CAPITAL Total capital to risk-weighted assets 15.09 % 15.03 % 16.34 % Tier 1 capital to risk-weighted assets 13.18 13.12 14.26 Common equity tier 1 capital ratio 11.88 11.78 13.08 Tier 1 leverage ratio 10.34 10.07 10.44 Total stockholders' equity to total assets 9.14 9.06 8.52 Tangible common equity to tangible assets (1) 7.64 7.54 7.85 ASSET QUALITY Net charge-offs (recoveries) to average loans (0.01) % (0.01) % 0.01 % (0.01) % (0.06) % Allowance for credit losses to loans, before allowance
for credit losses1.16 1.17 0.97 Nonperforming loans to loans, before allowance for
credit losses0.20 0.23 0.12 Nonperforming assets to total assets 0.16 0.21 0.14 * Annualized measure. (1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
comparable GAAP financial measures.(2) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%. HBT Financial, Inc. Unaudited Consolidated Financial Summary Consolidated Statements of Income Three Months Ended Nine Months Ended September 30, (dollars in thousands, except per share data) September 30,
2023June 30,
2023September 30,
20222023 2022 INTEREST AND DIVIDEND INCOME Loans, including fees: Taxable $ 49,640 $ 47,149 $ 29,855 $ 138,948 $ 84,504 Federally tax exempt 1,072 1,040 842 3,064 2,183 Securities: Taxable 6,451 6,518 6,635 19,585 16,947 Federally tax exempt 978 1,162 1,207 3,337 3,385 Interest-bearing deposits in bank 714 781 458 2,234 1,037 Other interest and dividend income 186 118 17 420 50 Total interest and dividend income 59,041 56,768 39,014 167,588 108,106 INTEREST EXPENSE Deposits 7,211 4,323 587 13,908 1,662 Securities sold under agreements to repurchase 35 34 9 107 26 Borrowings 2,108 2,189 85 5,594 87 Subordinated notes 470 469 470 1,409 1,409 Junior subordinated debentures issued to capital
trusts938 881 473 2,582 1,231 Total interest expense 10,762 7,896 1,624 23,600 4,415 Net interest income 48,279 48,872 37,390 143,988 103,691 PROVISION FOR CREDIT LOSSES 480 (230 ) 386 6,460 (53 ) Net interest income after provision for credit
losses47,799 49,102 37,004 137,528 103,744 NONINTEREST INCOME Card income 2,763 2,905 2,569 8,326 7,687 Wealth management fees 2,381 2,279 2,059 6,998 6,670 Service charges on deposit accounts 2,040 1,919 1,927 5,830 5,371 Mortgage servicing 1,169 1,254 697 3,522 2,016 Mortgage servicing rights fair value adjustment 23 141 351 (460 ) 2,446 Gains on sale of mortgage loans 476 373 354 1,125 1,267 Realized gains (losses) on sales of securities (813 ) — — (1,820 ) — Unrealized gains (losses) on equity securities (46 ) 7 (107 ) (61 ) (447 ) Gains (losses) on foreclosed assets 550 (97 ) (225 ) 443 (192 ) Gains (losses) on other assets 52 109 (31 ) 161 119 Income on bank owned life insurance 153 147 41 415 122 Other noninterest income 742 877 599 2,362 1,769 Total noninterest income 9,490 9,914 8,234 26,841 26,828 NONINTEREST EXPENSE Salaries 15,644 16,660 12,752 51,715 38,489 Employee benefits 2,616 2,707 1,771 7,658 6,199 Occupancy of bank premises 2,573 2,785 1,979 7,460 5,780 Furniture and equipment 667 809 668 2,135 1,843 Data processing 2,581 2,883 1,631 9,787 5,274 Marketing and customer relations 1,679 1,359 880 3,874 2,936 Amortization of intangible assets 720 720 243 1,950 733 FDIC insurance 512 630 302 1,705 888 Loan collection and servicing 345 348 336 971 771 Foreclosed assets 76 97 97 234 260 Other noninterest expense 3,258 4,975 3,339 13,088 8,824 Total noninterest expense 30,671 33,973 23,998 100,577 71,997 INCOME BEFORE INCOME TAX EXPENSE 26,618 25,043 21,240 63,792 58,575 INCOME TAX EXPENSE 6,903 6,570 5,613 16,396 15,259 NET INCOME $ 19,715 $ 18,473 $ 15,627 $ 47,396 $ 43,316 EARNINGS PER SHARE - BASIC $ 0.62 $ 0.58 $ 0.54 $ 1.50 $ 1.50 EARNINGS PER SHARE - DILUTED $ 0.62 $ 0.58 $ 0.54 $ 1.49 $ 1.49 WEIGHTED AVERAGE SHARES OF COMMON
STOCK OUTSTANDING31,829,250 31,980,133 28,787,662 31,598,650 28,887,757 HBT Financial, Inc. Unaudited Consolidated Financial Summary Consolidated Balance Sheets (dollars in thousands) September 30,
2023June 30, 2023 September 30,
2022ASSETS Cash and due from banks $ 24,757 $ 28,044 $ 22,169 Interest-bearing deposits with banks 87,156 81,764 56,046 Cash and cash equivalents 111,913 109,808 78,215 Interest-bearing time deposits with banks 500 — — Debt securities available-for-sale, at fair value 753,163 822,788 853,740 Debt securities held-to-maturity 527,144 533,231 546,694 Equity securities with readily determinable fair value 3,106 3,152 2,996 Equity securities with no readily determinable fair value 2,300 2,275 1,977 Restricted stock, at cost 11,165 11,345 4,050 Loans held for sale 3,563 8,829 2,297 Loans, before allowance for credit losses 3,342,786 3,244,655 2,579,928 Allowance for credit losses (38,863 ) (37,814 ) (25,060 ) Loans, net of allowance for credit losses 3,303,923 3,206,841 2,554,868 Bank owned life insurance 23,747 23,594 7,515 Bank premises and equipment, net 64,713 65,029 50,854 Bank premises held for sale 35 35 281 Foreclosed assets 1,519 3,080 2,637 Goodwill 59,820 59,876 29,322 Intangible assets, net 21,402 22,122 1,210 Mortgage servicing rights, at fair value 20,156 20,133 10,440 Investments in unconsolidated subsidiaries 1,614 1,614 1,165 Accrued interest receivable 23,447 19,900 16,881 Other assets 58,538 62,158 48,182 Total assets $ 4,991,768 $ 4,975,810 $ 4,213,324 LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities Deposits: Noninterest-bearing $ 1,086,877 $ 1,125,823 $ 1,017,710 Interest-bearing 3,111,191 3,038,700 2,625,733 Total deposits 4,198,068 4,164,523 3,643,443 Securities sold under agreements to repurchase 28,900 38,729 48,130 Federal Home Loan Bank advances 177,650 177,572 60,000 Subordinated notes 39,454 39,435 39,376 Junior subordinated debentures issued to capital trusts 52,774 52,760 37,763 Other liabilities 38,671 51,939 25,539 Total liabilities 4,535,517 4,524,958 3,854,251 Stockholders' Equity Common stock 327 327 293 Surplus 295,483 294,875 222,436 Retained earnings 256,050 241,777 223,495 Accumulated other comprehensive income (loss) (78,432 ) (70,662 ) (77,462 ) Treasury stock at cost (17,177 ) (15,465 ) (9,689 ) Total stockholders’ equity 456,251 450,852 359,073 Total liabilities and stockholders’ equity $ 4,991,768 $ 4,975,810 $ 4,213,324 SHARES OF COMMON STOCK OUTSTANDING 31,774,140 31,865,868 28,752,626 HBT Financial, Inc. Unaudited Consolidated Financial Summary (dollars in thousands) September 30,
2023June 30, 2023 September 30,
2022LOANS Commercial and industrial $ 386,933 $ 385,768 $ 240,671 Commercial real estate - owner occupied 297,242 303,522 226,524 Commercial real estate - non-owner occupied 901,929 882,598 718,089 Construction and land development 371,158 335,262 364,290 Multi-family 388,742 375,536 260,630 One-to-four family residential 488,655 482,442 328,667 Agricultural and farmland 275,239 259,858 245,234 Municipal, consumer, and other 232,888 219,669 195,823 Total loans $ 3,342,786 $ 3,244,655 $ 2,579,928 (dollars in thousands) September 30,
2023June 30, 2023 September 30,
2022DEPOSITS Noninterest-bearing deposits $ 1,086,877 $ 1,125,823 $ 1,017,710 Interest-bearing deposits: Interest-bearing demand 1,134,721 1,181,187 1,131,284 Money market (1) 673,780 730,652 584,202 Savings 623,083 657,506 641,139 Time (1) 679,607 469,355 269,108 Total interest-bearing deposits 3,111,191 3,038,700 2,625,733 Total deposits $ 4,198,068 $ 4,164,523 $ 3,643,443 (1) Time deposits include $115.0 million of brokered deposits as of September 30, 2023 and money market deposits include $51.0 million
of brokered deposits as of June 30, 2023. There were no brokered deposits as of September 30, 2022.HBT Financial, Inc. Unaudited Consolidated Financial Summary Three Months Ended September 30, 2023 June 30, 2023 September 30, 2022 (dollars in thousands) Average
BalanceInterest Yield/Cost
*Average
BalanceInterest Yield/Cost
*Average
BalanceInterest Yield/Cost
*ASSETS Loans $ 3,296,703 $ 50,712 6.10 % $ 3,238,774 $ 48,189 5.97 % $ 2,481,920 $ 30,697 4.91 % Securities 1,324,686 7,429 2.22 1,384,180 7,680 2.23 1,470,092 7,842 2.12 Deposits with banks 77,595 714 3.65 84,366 781 3.71 105,030 458 1.73 Other 9,347 186 7.90 8,577 118 5.52 2,936 17 2.25 Total interest-earning assets 4,708,331 $ 59,041 4.97 % 4,715,897 $ 56,768 4.83 % 4,059,978 $ 39,014 3.81 % Allowance for credit losses (38,317 ) (39,484 ) (24,717 ) Noninterest-earning assets 294,818 299,622 173,461 Total assets $ 4,964,832 $ 4,976,035 $ 4,208,722 LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities Interest-bearing deposits: Interest-bearing demand $ 1,160,654 $ 761 0.26 % $ 1,224,285 $ 683 0.22 % $ 1,137,072 $ 144 0.05 % Money market 683,859 2,041 1.18 675,530 1,516 0.90 577,388 203 0.14 Savings 639,384 249 0.15 687,014 189 0.11 649,752 53 0.03 Time 585,372 4,160 2.82 447,146 1,935 1.74 271,870 187 0.27 Total interest-bearing deposits 3,069,269 7,211 0.93 3,033,975 4,323 0.57 2,636,082 587 0.09 Securities sold under agreements
to repurchase33,807 35 0.41 34,170 34 0.40 50,427 9 0.07 Borrowings 157,908 2,108 5.30 173,040 2,189 5.07 11,967 85 2.80 Subordinated notes 39,444 470 4.72 39,424 469 4.78 39,365 470 4.73 Junior subordinated debentures
issued to capital trusts52,767 938 7.05 52,752 881 6.70 37,755 473 4.97 Total interest-bearing liabilities 3,353,195 $ 10,762 1.27 % 3,333,361 $ 7,896 0.95 % 2,775,596 $ 1,624 0.23 % Noninterest-bearing deposits 1,105,472 1,145,089 1,031,407 Noninterest-bearing liabilities 46,564 43,080 20,736 Total liabilities 4,505,231 4,521,530 3,827,739 Stockholders' Equity 459,601 454,505 380,983 Total liabilities and stockholders’ equity $ 4,964,832 $ 4,976,035 $ 4,208,722 Net interest income/Net interest
margin (1)$ 48,279 4.07 % $ 48,872 4.16 % $ 37,390 3.65 % Tax-equivalent adjustment (2) 675 0.06 715 0.06 674 0.07 Net interest income (tax-equivalent basis)/
Net interest margin (tax-equivalent
basis) (2) (3)$ 48,954 4.13 % $ 49,587 4.22 % $ 38,064 3.72 % Net interest rate spread (4) 3.70 % 3.88 % 3.58 % Net interest-earning assets (5) $ 1,355,136 $ 1,382,536 $ 1,284,382 Ratio of interest-earning assets
to interest-bearing liabilities1.40 1.41 1.46 Cost of total deposits 0.69 % 0.41 % 0.06 % Cost of funds 0.96 0.71 0.17 * Annualized measure. (1) Net interest margin represents net interest income divided by average total interest-earning assets. (2) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state income tax rate of 9.5%. (3) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
comparable GAAP financial measures.(4) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average
interest-bearing liabilities.(5) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities. HBT Financial, Inc. Unaudited Consolidated Financial Summary Nine Months Ended September 30, 2023 September 30, 2022 (dollars in thousands) Average
BalanceInterest Yield/Cost * Average
BalanceInterest Yield/Cost * ASSETS Loans $ 3,183,641 $ 142,012 5.96 % $ 2,485,501 $ 86,687 4.66 % Securities 1,373,175 22,922 2.23 1,405,245 20,332 1.93 Deposits with banks 84,720 2,234 3.53 237,646 1,037 0.58 Other 8,457 420 6.64 2,829 50 2.36 Total interest-earning assets 4,649,993 $ 167,588 4.82 % 4,131,221 $ 108,106 3.50 % Allowance for credit losses (37,053 ) (24,467 ) Noninterest-earning assets 289,843 172,243 Total assets $ 4,902,783 $ 4,278,997 LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities Interest-bearing deposits: Interest-bearing demand $ 1,204,937 $ 1,902 0.21 % $ 1,146,635 $ 430 0.05 % Money market 664,846 4,492 0.90 585,815 434 0.10 Savings 678,495 616 0.12 653,659 155 0.03 Time 463,937 6,898 1.99 289,000 643 0.30 Total interest-bearing deposits 3,012,215 13,908 0.62 2,675,109 1,662 0.08 Securities sold under agreements
to repurchase35,844 107 0.40 51,503 26 0.07 Borrowings 148,443 5,594 5.04 4,344 87 2.67 Subordinated notes 39,424 1,409 4.78 39,345 1,409 4.79 Junior subordinated debentures
issued to capital trusts51,054 2,582 6.76 37,738 1,231 4.36 Total interest-bearing liabilities 3,286,980 $ 23,600 0.96 % 2,808,039 $ 4,415 0.21 % Noninterest-bearing deposits 1,123,917 1,060,566 Noninterest-bearing liabilities 46,310 21,883 Total liabilities 4,457,207 3,890,488 Stockholders' Equity 445,576 388,509 Total liabilities and stockholders’ equity $ 4,902,783 4,278,997 Net interest income/Net interest margin (1) $ 143,988 4.14 % $ 103,691 3.36 % Tax-equivalent adjustment (2) 2,092 0.06 1,801 0.05 Net interest income (tax-equivalent basis)/
Net interest margin (tax-equivalent basis) (2) (3)$ 146,080 4.20 % $ 105,492 3.41 % Net interest rate spread (4) 3.86 % 3.29 % Net interest-earning assets (5) $ 1,363,013 $ 1,323,182 Ratio of interest-earning assets
to interest-bearing liabilities1.41 1.47 Cost of total deposits 0.45 % 0.06 % Cost of funds 0.72 0.15 * Annualized measure. (1) Net interest margin represents net interest income divided by average total interest-earning assets. (2) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state income tax rate of 9.5%. (3) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely
comparable GAAP financial measures.(4) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average
interest-bearing liabilities.(5) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities. HBT Financial, Inc. Unaudited Consolidated Financial Summary (dollars in thousands) September 30,
2023June 30, 2023 September 30,
2022NONPERFORMING ASSETS Nonaccrual $ 6,678 $ 7,534 $ 3,206 Past due 90 days or more, still accruing (1) — 1 — Total nonperforming loans 6,678 7,535 3,206 Foreclosed assets 1,519 3,080 2,637 Total nonperforming assets $ 8,197 $ 10,615 $ 5,843 Nonperforming loans that are wholly or partially guaranteed by the U.S.
Government$ 1,968 $ 2,332 $ — Allowance for credit losses $ 38,863 $ 37,814 $ 25,060 Loans, before allowance for credit losses 3,342,786 3,244,655 2,579,928 CREDIT QUALITY RATIOS Allowance for credit losses to loans, before allowance for credit losses 1.16 % 1.17 % 0.97 % Allowance for credit losses to nonaccrual loans 581.96 501.91 781.66 Allowance for credit losses to nonperforming loans 581.96 501.84 781.66 Nonaccrual loans to loans, before allowance for credit losses 0.20 0.23 0.12 Nonperforming loans to loans, before allowance for credit losses 0.20 0.23 0.12 Nonperforming assets to total assets 0.16 0.21 0.14 Nonperforming assets to loans, before allowance for credit losses, and
foreclosed assets0.25 0.33 0.23 (1) Prior to 2023, excludes loans acquired with deteriorated credit quality that are past due 90 or more days and accruing. Such loans
totaled $22 thousand as of September 30, 2022.HBT Financial, Inc. Unaudited Consolidated Financial Summary Three Months Ended Nine Months Ended
September 30,(dollars in thousands) September
30,
2023June 30,
2023September
30,
20222023 2022 ALLOWANCE FOR CREDIT LOSSES Beginning balance $ 37,814 $ 38,776 $ 24,734 $ 25,333 $ 23,936 Adoption of ASC 326 — — — 6,983 — PCD allowance established in acquisition — — — 1,247 — Provision for credit losses 983 (1,080 ) 386 5,004 (53 ) Charge-offs (412 ) (179 ) (222 ) (733 ) (515 ) Recoveries 478 297 162 1,029 1,692 Ending balance $ 38,863 $ 37,814 $ 25,060 $ 38,863 $ 25,060 Net charge-offs (recoveries) $ (66 ) $ (118 ) $ 60 $ (296 ) $ (1,177 ) Average loans 3,296,703 3,238,774 2,481,920 3,183,641 2,485,501 Net charge-offs (recoveries) to average loans * (0.01) % (0.01) % 0.01 % (0.01) % (0.06) % * Annualized measure. Three Months Ended Nine Months Ended
September 30,(dollars in thousands) September
30,
2023June 30,
2023September
30,
20222023 2022 PROVISION FOR CREDIT LOSSES Loans (1) $ 983 $ (1,080 ) $ 386 $ 5,004 $ (53 ) Unfunded lending-related commitments (1) 297 650 — 1,456 — Debt securities (800 ) 200 — — — Total provision for credit losses $ 480 $ (230 ) $ 386 $ 6,460 $ (53 ) (1) Includes recognition of an allowance for credit losses on non-PCD loans of $5.2 million and an allowance for credit losses on unfunded
commitments of $0.7 million in connection with the Town and Country merger during the first quarter of 2023.Reconciliation of Non-GAAP Financial Measures – Adjusted Net Income and Adjusted Return on Average Assets Three Months Ended Nine Months Ended September 30, (dollars in thousands) September
30,
2023June 30,
2023September 30,
20222023 2022 Net income $ 19,715 $ 18,473 $ 15,627 $ 47,396 $ 43,316 Adjustments: Acquisition expenses (1) — (627 ) (462 ) (13,691 ) (462 ) Gains (losses) on sales of closed branch
premises— 75 (38 ) 75 141 Realized gains (losses) on sales of securities (813 ) — — (1,820 ) — Mortgage servicing rights fair value
adjustment23 141 351 (460 ) 2,446 Total adjustments (790 ) (411 ) (149 ) (15,896 ) 2,125 Tax effect of adjustments 226 112 (80 ) 4,382 (728 ) Total adjustments after tax effect (564 ) (299 ) (229 ) (11,514 ) 1,397 Adjusted net income $ 20,279 $ 18,772 $ 15,856 $ 58,910 $ 41,919 Average assets $ 4,964,832 $ 4,976,035 $ 4,208,722 $ 4,902,783 $ 4,278,997 Return on average assets * 1.58 % 1.49 % 1.47 % 1.29 % 1.35 % Adjusted return on average assets * 1.62 1.51 1.49 1.61 1.31 * Annualized measure. (1) Includes recognition of an allowance for credit losses on non-PCD loans of $5.2 million and an allowance for credit losses on unfunded
commitments of $0.7 million in connection with the Town and Country merger during the first quarter of 2023.Reconciliation of Non-GAAP Financial Measures – Adjusted Earnings Per Share Three Months Ended Nine Months Ended
September 30,(dollars in thousands, except per share amounts) September
30,
2023June 30,
2023September
30,
20222023 2022 Numerator: Net income $ 19,715 $ 18,473 $ 15,627 $ 47,396 $ 43,316 Earnings allocated to participating securities
(1)(10 ) (11 ) (17 ) (26 ) (51 ) Numerator for earnings per share - basic and
diluted$ 19,705 $ 18,462 $ 15,610 $ 47,370 $ 43,265 Adjusted net income $ 20,279 $ 18,772 $ 15,856 $ 58,910 $ 41,919 Earnings allocated to participating securities
(1)(10 ) (10 ) (17 ) (33 ) (49 ) Numerator for adjusted earnings per share -
basic and diluted$ 20,269 $ 18,762 $ 15,839 $ 58,877 $ 41,870 Denominator: Weighted average common shares
outstanding31,829,250 31,980,133 28,787,662 31,598,650 28,887,757 Dilutive effect of outstanding restricted stock
units137,187 99,850 72,643 102,574 56,761 Weighted average common shares
outstanding, including all dilutive potential
shares31,966,437 32,079,983 28,860,305 31,701,224 28,944,518 Earnings per share - Basic $ 0.62 $ 0.58 $ 0.54 $ 1.50 $ 1.50 Earnings per share - Diluted $ 0.62 $ 0.58 $ 0.54 $ 1.49 $ 1.49 Adjusted earnings per share - Basic $ 0.64 $ 0.59 $ 0.55 $ 1.86 $ 1.45 Adjusted earnings per share - Diluted $ 0.63 $ 0.58 $ 0.55 $ 1.86 $ 1.45 (1) The Company has granted certain restricted stock units that contain non-forfeitable rights to dividend equivalents. Such restricted
stock units are considered participating securities. As such, we have included these restricted stock units in the calculation of basic
earnings per share and calculate basic earnings per share using the two-class method. The two-class method of computing earnings
per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating
security according to dividends declared (or accumulated) and participation rights in undistributed earnings.Reconciliation of Non-GAAP Financial Measures – Net Interest Income and Net Interest Margin (Tax-equivalent Basis) Three Months Ended Nine Months Ended
September 30,(dollars in thousands) September
30,
2023June 30,
2023September
30,
20222023 2022 Net interest income (tax-equivalent basis) Net interest income $ 48,279 $ 48,872 $ 37,390 $ 143,988 $ 103,691 Tax-equivalent adjustment (1) 675 715 674 2,092 1,801 Net interest income (tax-equivalent basis) (1) $ 48,954 $ 49,587 $ 38,064 $ 146,080 $ 105,492 Net interest margin (tax-equivalent basis) Net interest margin * 4.07 % 4.16 % 3.65 % 4.14 % 3.36 % Tax-equivalent adjustment * (1) 0.06 0.06 0.07 0.06 0.05 Net interest margin (tax-equivalent basis) * (1) 4.13 % 4.22 % 3.72 % 4.20 % 3.41 % Average interest-earning assets $ 4,708,331 $ 4,715,897 $ 4,059,978 $ 4,649,993 $ 4,131,221 * Annualized measure. (1) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%. Reconciliation of Non-GAAP Financial Measures – Efficiency Ratio (Tax-equivalent Basis) Three Months Ended Nine Months Ended
September 30,(dollars in thousands) September
30,
2023June 30,
2023September
30,
20222023 2022 Efficiency ratio (tax-equivalent basis) Total noninterest expense $ 30,671 $ 33,973 $ 23,998 $ 100,577 $ 71,997 Less: amortization of intangible assets 720 720 243 1,950 733 Adjusted noninterest expense $ 29,951 $ 33,253 $ 23,755 $ 98,627 $ 71,264 Net interest income $ 48,279 $ 48,872 $ 37,390 $ 143,988 $ 103,691 Total noninterest income 9,490 9,914 8,234 26,841 26,828 Operating revenue 57,769 58,786 45,624 170,829 130,519 Tax-equivalent adjustment (1) 675 715 674 2,092 1,801 Operating revenue (tax-equivalent basis)
(1)$ 58,444 $ 59,501 $ 46,298 $ 172,921 $ 132,320 Efficiency ratio 51.85 % 56.57 % 52.07 % 57.73 % 54.60 % Efficiency ratio (tax-equivalent basis) (1) 51.25 55.89 51.31 57.04 53.86 (1) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%. Reconciliation of Non-GAAP Financial Measures – Tangible Common Equity to Tangible Assets and Tangible Book Value Per Share (dollars in thousands, except per share data) September 30,
2023June 30, 2023 September 30,
2022Tangible Common Equity Total stockholders' equity $ 456,251 $ 450,852 $ 359,073 Less: Goodwill 59,820 59,876 29,322 Less: Intangible assets, net 21,402 22,122 1,210 Tangible common equity $ 375,029 $ 368,854 $ 328,541 Tangible Assets Total assets $ 4,991,768 $ 4,975,810 $ 4,213,324 Less: Goodwill 59,820 59,876 29,322 Less: Intangible assets, net 21,402 22,122 1,210 Tangible assets $ 4,910,546 $ 4,893,812 $ 4,182,792 Total stockholders' equity to total assets 9.14 % 9.06 % 8.52 % Tangible common equity to tangible assets 7.64 7.54 7.85 Shares of common stock outstanding 31,774,140 31,865,868 28,752,626 Book value per share $ 14.36 $ 14.15 $ 12.49 Tangible book value per share 11.80 11.58 11.43 Reconciliation of Non-GAAP Financial Measures – Return on Average Tangible Common Equity, Adjusted Return on Average Stockholders' Equity and Adjusted Return on Tangible Common Equity Three Months Ended Nine Months Ended
September 30,(dollars in thousands) September
30,
2023June 30,
2023September
30,
20222023 2022 Average Tangible Common Equity Total stockholders' equity $ 459,601 $ 454,505 $ 380,983 $ 445,576 $ 388,509 Less: Goodwill 59,875 59,876 29,322 56,406 29,322 Less: Intangible assets, net 21,793 22,520 1,356 20,005 1,597 Average tangible common equity $ 377,933 $ 372,109 $ 350,305 $ 369,165 $ 357,590 Net income $ 19,715 $ 18,473 $ 15,627 $ 47,396 $ 43,316 Adjusted net income 20,279 18,772 15,856 58,910 41,919 Return on average stockholders' equity * 17.02 % 16.30 % 16.27 % 14.22 % 14.91 % Return on average tangible common equity * 20.7 19.91 17.7 17.17 16.2 Adjusted return on average stockholders'
equity *17.51 % 16.57 % 16.51 % 17.68 % 14.43 % Adjusted return on average tangible common
equity *21.29 20.23 17.96 21.34 15.67 * Annualized measure. 
