• Live Oak Bancshares, Inc. Reports First Quarter 2022 Results

    ソース: Nasdaq GlobeNewswire / 27 4 2022 16:45:01   America/New_York

    WILMINGTON, N.C., April 27, 2022 (GLOBE NEWSWIRE) -- Live Oak Bancshares, Inc. (Nasdaq: LOB) (“Live Oak” or “the Company”) today reported first quarter of 2022 net income of $34.5 million, or $0.76 per diluted share.

    “Live Oak Bank continues to focus on soundness, profitability and growth – in that order – and this quarter sustains the momentum of our franchise with strong balance sheet growth, credit quality and a differentiated model dedicated to America’s small business owners,” said Live Oak Chairman and CEO James S. (Chip) Mahan, III. “The beginning of 2022 provided continued indications that the small business market is robust and there remain many exciting opportunities for Live Oak to serve American entrepreneurs on a next-generation platform.”

    First Quarter 2022 Key Measures

    (Dollars in thousands, except per share data)         Increase (Decrease)     
      1Q 2022  4Q 2021  Dollars  Percent  1Q 2021 
    Total revenue (1) $110,447  $111,394  $(947)  (1)% $101,007 
    Total noninterest expense  65,714   59,698   6,016   10   58,272 
    Income before taxes  42,897   47,778   (4,881)  (10)  43,608 
    Effective tax rate  19.6%  36.9% n/a  n/a   9.6%
    Net income $34,509  $30,147  $4,362   14% $39,427 
    Diluted earnings per share  0.76   0.66   0.10   15   0.88 
    Loan and lease production:                    
    Loans and leases originated $865,063  $1,083,623  $(218,560)  (20)% $1,180,219 
    % Fully funded  55.9%  54.1% n/a  n/a   77.7%
    Total loans and leases: $6,766,876  $6,637,781  $129,095   2% $6,533,495 
    Total loans and leases, excluding PPP loans:  6,636,056   6,375,903   260,153   4   5,088,437 
    Total assets:  8,619,966   8,213,393   406,573   5   8,417,875 
    Total deposits:  7,637,163   7,112,044   525,119   7   6,316,004 

    (1) Total revenue consists of net interest income and total noninterest income.

    Loans and Leases

    As of March 31, 2022, the total loan and lease portfolio was $6.77 billion, 3.6% above its level a year ago and 1.9% above its level at December 31, 2021. Compared to the fourth quarter of 2021, loans and leases held for investment increased $217.0 million, or 3.9%, to $5.74 billion while loans held for sale decreased $87.9 million, or 7.9%, to $1.03 billion. Average loans and leases were $6.72 billion during the first quarter of 2022 compared to $6.45 billion during the fourth quarter of 2021. Excluding Paycheck Protection Program (“PPP”) loans, the total loan and lease portfolio increased by $1.55 billion, or 30.4%, compared to March 31, 2021, and $260.2 million, or 4.1%, compared to December 31, 2021.

    The total loan and lease portfolio of $6.77 billion includes $130.8 million of PPP loans, net of deferred fees and costs, at March 31, 2022, which are carried at historical cost classified as held for investment. The total loan and lease portfolio at March 31, 2022, and December 31, 2021, of $6.77 billion and $6.64 billion, respectively, was comprised of 54.9% and 51.6% of unguaranteed loans and leases, respectively.

    Loan and lease originations totaled $865.1 million during the first quarter of 2022, a decrease of $218.6 million, or 20.2%, from the fourth quarter of 2021. Excluding PPP loans, loan and lease originations increased $192.6 million, or 28.6%, from the first quarter of 2021.

    Deposits

    Total deposits increased to $7.64 billion at March 31, 2022, an increase of $1.32 billion compared to March 31, 2021, and an increase of $525.1 million compared to December 31, 2021. The increase in total deposits from the prior quarters provides support for the growth in the loan and lease portfolio.

    Average total interest-bearing deposits for the first quarter of 2022 increased $343.2 million, or 5.0%, to $7.25 billion, compared to $6.91 billion for the fourth quarter of 2021. The ratio of average total loans and leases to average interest-bearing deposits was 92.8% for the first quarter of 2022, compared to 93.4% for the fourth quarter of 2021.

    Borrowings

    Borrowings totaled $196.9 million at March 31, 2022, compared to $1.47 billion and $318.3 million at March 31, 2021, and December 31, 2021, respectively. During the first quarter of 2022, the Company decreased borrowings by $121.4 million and $1.27 billion as compared to December 31, and March 31, 2021, respectively, primarily by reducing the outstanding balance in the Federal Reserve’s Paycheck Protection Program Liquidity Facility (“PPPLF”) to $136.5 million as of March 31, 2022. The PPPLF has a 100% advance rate equal to the principal amount of PPP loans pledged as security and carries an interest rate of 0.35%, and loans financed under the PPPLF have a neutral impact on regulatory leverage capital ratios.

    Net Interest Income

    Net interest income for the first quarter of 2022 increased to $77.8 million compared to $70.0 million for the first quarter of 2021 and $77.6 million for the fourth quarter of 2021.

    The increase for the first quarter of 2022 compared to the first quarter of 2021 was driven by the significant growth in the total loan and lease portfolio combined with the reduction in the average rate on interest bearing liabilities from 1.02% for the first quarter of 2021 to 0.81% for the first quarter of 2022.

    The net interest margin remained level compared to the fourth quarter of 2021 at 4.02%, with the yield on interest earning assets increasing by two basis points to 4.79% while the average cost of interest-bearing liabilities also increased by two basis points to 0.81%.

    Noninterest Income

    Noninterest income for the first quarter of 2022 increased to $32.7 million compared to $31.1 million for the first quarter of 2021 and decreased compared to $33.8 million for the fourth quarter of 2021. The primary drivers in noninterest income changes are outlined below.

    The loan servicing asset revaluation resulted in a loss of $1.6 million for the first quarter of 2022 compared to a gain of $1.5 million for the first quarter of 2021 and a loss of $4.2 million for the fourth quarter of 2021. The decrease in the loan servicing asset revaluation from the first quarter of 2021 was largely related to prepayment speeds increasing over the prior year. The reduction of loss in the loan servicing asset revaluation from the fourth quarter of 2021 was principally the result of positive market pricing movements.

    Net gains on sales of loans increased $9.0 million compared to the first quarter of 2021 and $720 thousand compared to the fourth quarter of 2021.  The primary driver for the increase was the volume of guaranteed loans sold which increased to $219.7 million for the first quarter of 2022 compared to $199.0 million sold in the fourth quarter of 2021 and $136.7 million sold in the first quarter of 2021. The volume of loan sales in the first quarter of 2022 was influenced by current market considerations. The average net gain on sale premium was 109%, 110% and 110% for the first quarter of 2022, fourth quarter of 2021 and first quarter of 2021, respectively.

    The net gain on loans accounted for under the fair value option totaled $516 thousand for the first quarter of 2022, a $3.7 million decrease compared to the $4.2 million net gain for the first quarter of 2021. The $3.7 million decrease in the gain was largely the result of significant economic forecasts improvements experienced during the first quarter of 2021.

    Equity method investments had a net loss totaling $2.1 million for the first quarter of 2022, a $967 thousand higher net loss than the first quarter of 2021 and $5.1 million higher net loss than the fourth quarter of 2021. The increased level of net losses from equity method investments was largely a product of the Company’s pro rata portion of losses recognized by fintech oriented investment funds.

    Noninterest Expense

    Noninterest expense for the first quarter of 2022 totaled $65.7 million compared to $58.3 million for the first quarter of 2021 and $59.7 million for the fourth quarter of 2021. The primary drivers in noninterest expense changes are outlined below.

    Salaries and employee benefits for the first quarter of 2022 increased to $38.5 million compared to $31.4 million for the first quarter of 2021 and $32.5 million for the fourth quarter of 2021.  The increase in salaries and employee benefits was principally related to continued investment in human resources to support strategic and growth initiatives.

    Travel expense for the first quarter of 2022 increased to $1.9 million compared to $659 thousand for the first quarter of 2021 and $1.8 million for the fourth quarter of 2021. The increase in travel expenses over the first quarter of 2021 was largely related to supporting both loan origination volume and the customer base as travel restrictions continued to ease.

    Advertising and marketing expense increased to $1.7 million for the first quarter of 2022 compared to $652 thousand for the first quarter of 2021 and decreased compared to $1.8 million for the fourth quarter of 2021. The $1.0 million increase over the first quarter of 2021 was largely driven by renewed marketing events.

    Technology expense is a new line item which replaces data processing expense in previous income statements. This new line item includes data processing expense and other non-compensation related costs reclassified from equipment expense and other expense line items for software, computer and telecommunications. This reclassification was made primarily to improve the clarity of expenses related to the Company’s ongoing technology initiatives and is reflected in all comparative periods of this release. Technology expense for the first quarter of 2022 was $6.1 million, a $1.2 million increase over the first quarter of 2021. This increase was primarily related to enhanced investments in the Company’s technology resources.

    Partially offsetting the increase in noninterest expense for the first quarter of 2022 compared to the first quarter of 2021 was decreased impairment charges of $3.1 million related to renewable energy tax credit investments during the prior year combined with decreased professional services expense of $1.1 million largely driven by lower legal fees.

    Asset Quality

    During the first quarter of 2022, the Company recognized net charge-offs for loans carried at historical cost of $2.4 million compared to net recoveries of $984 thousand in the first quarter of 2021 and net charge-offs of $15 thousand in the fourth quarter of 2021. The increase in net charge-offs for the first quarter of 2022 was principally related to one relationship that was fully reserved for in the fourth quarter of 2021.  Net charge-offs (recoveries) as a percentage of average held for investment loans and leases carried at historical cost, annualized, for the quarters ended March 31, 2022 and 2021, and December 31, 2021, was 0.19%, (0.09)% and 0.00%, respectively.

    Unguaranteed nonperforming (nonaccrual) loans and leases, excluding $4.5 million and $4.8 million accounted for under the fair value option at March 31, 2022, and December 31, 2021, respectively, increased to $19.5 million, or 0.38% of loans and leases held for investment which are carried at historical cost, at March 31, 2022, compared to $16.0 million, or 0.33%, at December 31, 2021.

    Provision for (Recovery of) Loan and Lease Credit Losses

    The provision for loan and lease credit losses for the first quarter of 2022 totaled $1.8 million compared to a recovery of $873 thousand for the first quarter of 2021 and provision of $3.9 million for the fourth quarter of 2021. The level of provision expense in the first quarter of 2022 was primarily the result of continued improvement in forecasts related to employment and default expectations combined with the effect of higher than usual recoveries in certain verticals and overall growth in the loan and lease portfolio.

    The allowance for credit losses on loans and leases totaled $63.1 million at March 31, 2022, compared to $63.6 million at December 31, 2021. The allowance for credit losses on loans and leases as a percentage of total loans and leases held for investment carried at historical cost was 1.23% and 1.30% at March 31, 2022, and December 31, 2021, respectively.

    Income Tax

    Income tax expense and related effective tax rate was $8.4 million and 19.6% for the first quarter of 2022, $4.2 million and 9.6% for the first quarter of 2021, and $17.6 million and 36.9% for the fourth quarter of 2021, respectively. The effective tax rate for the first quarter of 2022 was principally influenced by anticipated renewable energy tax credits associated with investments expected in 2021 but delayed to 2022 due to supply chain issues.

    The higher level of income tax expense for the first quarter of 2022 compared to the first quarter of 2021 was primarily driven by vesting of restricted stock unit awards with market price conditions during the first three months of 2021.

    The lower level of income tax expense for the first quarter of 2022 compared to the fourth quarter of 2021 was primarily the product of the above mentioned recognition of fewer investment tax credits in the last quarter of 2021 than the Company had anticipated in its annual effective tax rate for that year.

    Shareholders’ Equity

    Total shareholders’ equity decreased by $1.8 million, or 0.3%, during the first quarter of 2022. This decrease was primarily due to $38.5 million of negative market impacts on the Company’s available-for-sale investment portfolio included in accumulated other comprehensive loss and largely offset by net income of $34.5 million.

    During the first quarter of 2022, all of the remaining shares of Class B common stock (non-voting) amounting to 125,024 shares were converted to Class A common stock (voting) in connection with private sales.

    Conference Call

    Live Oak will host a conference call to discuss quarterly results at 9:00 a.m. ET tomorrow morning (April 28, 2022). Media representatives, analysts and the public are invited to listen to this discussion by calling (844) 743-2494 (domestic) or (661) 378-9528 (international) with conference ID 8584099. A live webcast of the conference call along with presentation materials referenced during the conference call will be available on the Investor Relations page of the Company’s website at http://investor.liveoakbank.com. A replay of the conference call will also be available until May 5, 2022 and can be accessed by dialing (855) 859-2056 (domestic) or (404) 537-3406 (international) with conference ID 8584099.

    Important Note Regarding Forward-Looking Statements

    Statements in this press release that are based on other than historical data or that express the Company’s plans or expectations regarding future events or determinations are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Statements based on historical data are not intended and should not be understood to indicate the Company’s expectations regarding future events. Forward-looking statements provide current expectations or forecasts of future events or determinations. These forward-looking statements are not guarantees of future performance or determinations, nor should they be relied upon as representing management’s views as of any subsequent date. Forward-looking statements involve significant risks and uncertainties, and actual results may differ materially from those presented, either expressed or implied, in this press release. Factors that could cause actual results to differ materially from those expressed in the forward-looking statements include changes in Small Business Administration (“SBA”) rules, regulations or loan products, including the Section 7(a) program, changes in SBA standard operating procedures or changes in Live Oak Banking Company's status as an SBA Preferred Lender; changes in rules, regulations or procedures for other government loan programs, including those of the United States Department of Agriculture; the potential impacts of the Coronavirus Disease 2019 (COVID-19) pandemic on trade (including supply chains and export levels), travel, employee productivity and other economic activities that may have a destabilizing and negative effect on financial markets, economic activity and customer behavior; a reduction in or the termination of the Company's ability to use the technology-based platform that is critical to the success of its business model, including a failure in or a breach of operational or security systems; competition from other lenders; the Company's ability to attract and retain key personnel; market and economic conditions and the associated impact on the Company; operational, liquidity and credit risks associated with the Company's business; the impact of heightened regulatory scrutiny of financial products and services and the Company's ability to comply with regulatory requirements and expectations; adverse results, including related fees and expenses, from pending or future lawsuits, government investigations or private actions; and the other factors discussed in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) and available at the SEC’s Internet site (http://www.sec.gov). Except as required by law, the Company specifically disclaims any obligation to update any factors or to publicly announce the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.

    About Live Oak Bancshares, Inc.

    Live Oak Bancshares, Inc. (Nasdaq: LOB) is a financial holding company and the parent company of Live Oak Bank. Live Oak Bancshares and its subsidiaries partner with businesses that share a groundbreaking focus on service and technology to redefine banking. To learn more, visit www.liveoakbank.com.

    Contacts:

    William C. (BJ) Losch, III | CFO | Investor Relations | 910.765.9966
    Claire Parker | SVP Corporate Communications | Media Relations | 910.597.1592

    Live Oak Bancshares, Inc.
    Quarterly Statements of Income (unaudited)
    (Dollars in thousands, except per share data)

      Three months ended  1Q 2022 Change vs. 
      1Q 2022  4Q 2021  3Q 2021  2Q 2021  1Q 2021  4Q 2021  1Q 2021 
    Interest income                     %  % 
    Loans and fees on loans $89,198  $88,577  $89,388  $84,780  $84,993   0.7   4.9 
    Investment securities, taxable  3,399   3,455   3,147   2,975   2,929   (1.6)  16.0 
    Other interest earning assets  185   171   224   244   303   8.2   (38.9)
    Total interest income  92,782   92,203   92,786   87,999   88,225   0.6   5.2 
    Interest expense                            
    Deposits  14,348   13,817   14,159   14,820   16,944   3.8   (15.3)
    Borrowings  655   748   892   1,717   1,331   (12.4)  (50.8)
    Total interest expense  15,003   14,565   15,051   16,537   18,275   3.0   (17.9)
    Net interest income  77,779   77,638   77,735   71,462   69,950   0.2   11.2 
    Provision for (recovery of) loan and lease credit losses  1,836   3,918   4,319   7,846   (873)  (53.1)  (310.3)
    Net interest income after provision for (recovery of) loan and lease credit losses  75,943   73,720   73,416   63,616   70,823   3.0   7.2 
    Noninterest income                            
    Loan servicing revenue  6,356   6,289   6,278   6,218   6,434   1.1   (1.2)
    Loan servicing asset revaluation  (1,569)  (4,160)  (5,878)  (3,181)  1,493   62.3   (205.1)
    Net gains on sales of loans  20,977   20,257   18,860   16,234   11,929   3.6   75.8 
    Net gain (loss) on loans accounted for under the fair value option  516   (66)  (1,030)  1,135   4,218   881.8   (87.8)
    Equity method investments income (loss)  (2,124)  2,969   (1,250)  (2,278)  (1,157)  (171.5)  (83.6)
    Equity security investments gains (losses), net  (44)  218   176   44,253   105   (120.2)  (141.9)
    Lease income  2,503   2,521   2,527   2,616   2,599   (0.7)  (3.7)
    Management fee income  1,488   1,482   1,489   1,473   1,934   0.4   (23.1)
    Other noninterest income  4,565   4,246   4,104   3,641   3,502   7.5   30.4 
    Total noninterest income  32,668   33,756   25,276   70,111   31,057   (3.2)  5.2 
    Noninterest expense                            
    Salaries and employee benefits  38,507   32,464   28,202   32,900   31,366   18.6   22.8 
    Travel expense  1,897   1,782   1,819   1,549   659   6.5   187.9 
    Professional services expense  2,791   3,724   4,251   3,329   3,831   (25.1)  (27.1)
    Advertising and marketing expense  1,729   1,844   1,631   875   652   (6.2)  165.2 
    Occupancy expense  2,327   2,045   2,042   2,224   2,112   13.8   10.2 
    Technology expense  6,053   6,489   6,150   5,131   4,878   (6.7)  24.1 
    Equipment expense  3,816   3,741   3,706   3,721   3,701   2.0   3.1 
    Other loan origination and maintenance expense  3,113   3,406   3,489   3,307   3,327   (8.6)  (6.4)
    Renewable energy tax credit investment impairment        60      3,127      (100.0)
    FDIC insurance  1,972   1,931   1,670   1,704   1,765   2.1   11.7 
    Other expense  3,509   2,272   2,439   2,818   2,854   54.4   23.0 
    Total noninterest expense  65,714   59,698   55,459   57,558   58,272   10.1   12.8 
    Income before taxes  42,897   47,778   43,233   76,169   43,608   (10.2)  (1.6)
    Income tax expense  8,388   17,631   9,394   12,587   4,181   (52.4)  100.6 
    Net income $34,509  $30,147  $33,839  $63,582  $39,427   14.5   (12.5)
    Earnings per share                            
    Basic $0.79  $0.69  $0.78  $1.48  $0.92   14.5   (14.1)
    Diluted $0.76  $0.66  $0.76  $1.41  $0.88   15.2   (13.6)
    Weighted average shares outstanding                            
    Basic  43,701,943   43,492,172   43,329,889   43,173,312   42,673,615         
    Diluted  45,227,536   45,474,530   45,040,690   45,062,392   44,696,850         

    Live Oak Bancshares, Inc.
    Quarterly Balance Sheets (unaudited)
    (Dollars in thousands)

      As of the quarter ended  1Q 2022 Change vs. 
      1Q 2022  4Q 2021  3Q 2021  2Q 2021  1Q 2021  4Q 2021  1Q 2021 
    Assets                     %  % 
    Cash and due from banks $477,778  $187,203  $336,362  $428,907  $630,081   155.2   (24.2)
    Federal funds sold  29,993   16,547   10,672   9,917   5,461   81.3   449.2 
    Certificates of deposit with other banks  4,250   4,750   6,000   6,000   6,500   (10.5)  (34.6)
    Investment securities available-for-sale  844,577   906,052   861,377   817,896   775,177   (6.8)  9.0 
    Loans held for sale (1)  1,028,635   1,116,519   1,042,756   1,064,911   1,076,741   (7.9)  (4.5)
    Loans and leases held for investment (2)  5,738,241   5,521,262   5,418,611   5,441,423   5,456,754   3.9   5.2 
    Allowance for credit losses on loans and leases  (63,058)  (63,584)  (59,681)  (57,848)  (52,417)  0.8   (20.3)
    Net loans and leases  5,675,183   5,457,678   5,358,930   5,383,575   5,404,337   4.0   5.0 
    Premises and equipment, net  254,865   240,196   244,212   249,069   253,774   6.1   0.4 
    Foreclosed assets  198   620   883   1,793   4,185   (68.1)  (95.3)
    Servicing assets  36,286   33,574   33,968   36,966   37,744   8.1   (3.9)
    Other assets  268,201   250,254   242,181   244,152   223,875   7.2   19.8 
    Total assets $8,619,966  $8,213,393  $8,137,341  $8,243,186  $8,417,875   5.0   2.4 
    Liabilities and Shareholders’ Equity                            
    Liabilities                            
    Deposits:                            
    Noninterest-bearing $86,342  $89,279  $77,026  $89,768  $75,794   (3.3)  13.9 
    Interest-bearing  7,550,821   7,022,765   6,739,587   6,431,065   6,240,210   7.5   21.0 
    Total deposits  7,637,163   7,112,044   6,816,613   6,520,833   6,316,004   7.4   20.9 
    Borrowings  196,911   318,289   575,021   1,012,431   1,465,961   (38.1)  (86.6)
    Other liabilities  72,565   67,927   56,284   52,575   45,550   6.8   59.3 
    Total liabilities  7,906,639   7,498,260   7,447,918   7,585,839   7,827,515   5.4   1.0 
    Shareholders’ equity                            
    Preferred stock, no par value, 1,000,000 shares
    authorized, none issued or outstanding
                         
    Class A common stock (voting)  315,607   310,970   304,085   299,809   298,525   1.5   5.7 
    Class B common stock (non-voting)     1,324   5,404   5,404   7,330   (100.0)  (100.0)
    Retained earnings  434,226   400,893   371,869   339,011   275,377   8.3   57.7 
    Accumulated other comprehensive (loss) income  (36,506)  1,946   8,065   13,123   9,128   (1,976.0)  (499.9)
    Total shareholders' equity  713,327   715,133   689,423   657,347   590,360   (0.3)  20.8 
    Total liabilities and shareholders’ equity $8,619,966  $8,213,393  $8,137,341  $8,243,186  $8,417,875   5.0   2.4 

    (1) Includes $25.1 million, $25.3 million, $27.4 million, $29.0 million and $35.9 million measured at fair value for the quarters ended March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, respectively.
    (2) Includes $600.6 million, $645.2 million, $698.0 million, $743.2 million and $790.8 million measured at fair value for the quarters ended March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, respectively.


    Live Oak Bancshares, Inc.
    Quarterly Selected Financial Data
    (Dollars in thousands, except per share data)

      As of and for the three months ended 
      1Q 2022  4Q 2021  3Q 2021  2Q 2021  1Q 2021 
    Income Statement Data                    
    Net income $34,509  $30,147  $33,839  $63,582  $39,427 
    Per Common Share                    
    Net income, diluted $0.76  $0.66  $0.76  $1.41  $0.88 
    Dividends declared  0.03   0.03   0.03   0.03   0.03 
    Book value  16.29   16.39   15.89   15.19   13.74 
    Tangible book value (1)  16.20   16.31   15.80   15.10   13.65 
    Performance Ratios                    
    Return on average assets (annualized)  1.65%  1.47%  1.64%  3.01%  1.98%
    Return on average equity (annualized)  18.94   16.80   19.67   41.30   26.89 
    Net interest margin  4.02   4.02   3.99   3.63   3.81 
    Efficiency ratio (1)  59.50   53.59   53.84   40.66   57.69 
    Noninterest income to total revenue  29.58   30.30   24.54   49.52   30.75 
    Selected Loan Metrics                    
    Loans and leases originated $865,063  $1,083,623  $1,063,190  $1,153,693  $1,180,219 
    Outstanding balance of sold loans serviced  3,381,883   3,298,828   3,212,271   3,134,068   3,216,727 
    Asset Quality Ratios                    
    Allowance for credit losses to loans and leases held for investment (3)  1.23%  1.30%  1.26%  1.23%  1.12%
    Net charge-offs (recoveries) (3) $2,362  $15  $2,485  $2,417  $(984)
    Net charge-offs (recoveries) to average loans and leases held for investment (2) (3)  0.19%  0.00%  0.21%  0.21%  (0.09)%
                         
    Nonperforming loans and leases at historical cost (3)                    
    Unguaranteed $19,475  $15,987  $20,450  $22,458  $24,738 
    Guaranteed  32,828   26,546   28,888   25,551   32,633 
    Total  52,303   42,533   49,338   48,009   57,371 
    Unguaranteed nonperforming historical cost loans and leases, to loans and leases held for investment (3)  0.38%  0.33%  0.43%  0.48%  0.53%
                         
    Nonperforming loans at fair value (4)                    
    Unguaranteed $4,451  $4,791  $6,303  $5,503  $5,838 
    Guaranteed  30,850   33,471   36,708   34,323   34,396 
    Total  35,301   38,262   43,011   39,826   40,234 
    Unguaranteed nonperforming fair value loans to loans held for investment (4)  0.74%  0.74%  0.90%  0.74%  0.74%
    Capital Ratios                    
    Common equity tier 1 capital (to risk-weighted assets)  12.10%  12.38%  12.56%  12.45%  12.16%
    Tier 1 leverage capital (to average assets)  8.87   8.87   8.82   8.70   8.50 

    Notes to Quarterly Selected Financial Data
    (1) See accompanying GAAP to Non-GAAP Reconciliation.
    (2) Quarterly net charge-offs as a percentage of quarterly average loans and leases held for investment, annualized.
    (3) Loans and leases at historical cost only (excludes loans measured at fair value).
    (4) Loans accounted for under the fair value option only (excludes loans and leases carried at historical cost).

    Live Oak Bancshares, Inc.
    Quarterly Average Balances and Net Interest Margin
    (Dollars in thousands)

      Three Months Ended
    March 31, 2022
      Three Months Ended
    December 31, 2021
     
      Average Balance  Interest  Average Yield/Rate  Average Balance  Interest  Average Yield/Rate 
    Interest earning assets:                        
    Interest earning balances in other banks $223,638  $179   0.32% $331,077  $168   0.20%
    Federal funds sold  9,197   6   0.26   8,515   3   0.14 
    Investment securities  895,592   3,399   1.54   879,138   3,455   1.56 
    Loans held for sale  1,115,441   15,183   5.52   1,059,672   14,661   5.49 
    Loans and leases held for investment (1)  5,609,338   74,015   5.35   5,391,283   73,916   5.44 
    Total interest earning assets  7,853,206   92,782   4.79   7,669,685   92,203   4.77 
    Less: allowance for credit losses on loans and leases  (62,732)          (59,088)        
    Non-interest earning assets  588,171           569,493         
    Total assets $8,378,645          $8,180,090         
    Interest bearing liabilities:                        
    Savings $3,605,905  $4,840   0.54% $3,470,813  $4,487   0.51%
    Money market accounts  91,463   54   0.24   97,230   61   0.25 
    Certificates of deposit  3,551,310   9,454   1.08   3,337,399   9,269   1.10 
    Total interest bearing deposits  7,248,678   14,348   0.80   6,905,442   13,817   0.79 
    Borrowings  262,485   655   1.01   427,044   748   0.69 
    Total interest bearing liabilities  7,511,163   15,003   0.81   7,332,486   14,565   0.79 
    Non-interest bearing deposits  86,570           79,479         
    Non-interest bearing liabilities  51,940           50,190         
    Shareholders' equity  728,972           717,935         
    Total liabilities and shareholders' equity $8,378,645          $8,180,090         
    Net interest income and interest rate spread     $77,779   3.98%     $77,638   3.98%
    Net interest margin          4.02           4.02 
    Ratio of average interest-earning assets to average interest-bearing liabilities          104.55%          104.60%

    (1) Average loan and lease balances include non-accruing loans.

    Live Oak Bancshares, Inc.   
    GAAP to Non-GAAP Reconciliation
    (Dollars in thousands)

      As of and for the three months ended 
      1Q 2022  4Q 2021  3Q 2021  2Q 2021  1Q 2021 
    Total shareholders’ equity $713,327  $715,133  $689,423  $657,347  $590,360 
    Less:                    
    Goodwill  1,797   1,797   1,797   1,797   1,797 
    Other intangible assets  1,988   2,026   2,065   2,103   2,141 
    Tangible shareholders’ equity (a) $709,542  $711,310  $685,561  $653,447  $586,422 
    Shares outstanding (c)  43,787,660   43,619,070   43,381,014   43,264,460   42,951,344 
    Total assets $8,619,966  $8,213,393  $8,137,341  $8,243,186  $8,417,875 
    Less:                    
    Goodwill  1,797   1,797   1,797   1,797   1,797 
    Other intangible assets  1,988   2,026   2,065   2,103   2,141 
    Tangible assets (b) $8,616,181  $8,209,570  $8,133,479  $8,239,286  $8,413,937 
    Tangible shareholders’ equity to tangible assets (a/b)  8.23%  8.66%  8.43%  7.93%  6.97%
    Tangible book value per share (a/c) $16.20  $16.31  $15.80  $15.10  $13.65 
    Efficiency ratio:                    
    Noninterest expense (d) $65,714  $59,698  $55,459  $57,558  $58,272 
    Net interest income  77,779   77,638   77,735   71,462   69,950 
    Noninterest income  32,668   33,756   25,276   70,111   31,057 
    Less: gain on sale of securities               
    Adjusted operating revenue (e) $110,447  $111,394  $103,011  $141,573  $101,007 
    Efficiency ratio (d/e)  59.50%  53.59%  53.84%  40.66%  57.69%

    This press release presents the non-GAAP financial measures. The adjustments to reconcile from the non-GAAP financial measures to the applicable GAAP financial measure are included where applicable in financial results presented in accordance with GAAP. The Company considers these adjustments to be relevant to ongoing operating results. The Company believes that excluding the amounts associated with these adjustments to present the non-GAAP financial measures provides a meaningful base for period-to-period comparisons, which will assist regulators, investors, and analysts in analyzing the operating results or financial position of the Company. The non-GAAP financial measures are used by management to assess the performance of the Company’s business for presentations of Company performance to investors, and for other reasons as may be requested by investors and analysts. The Company further believes that presenting the non-GAAP financial measures will permit investors and analysts to assess the performance of the Company on the same basis as that applied by management. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied, and are not audited. Although non-GAAP financial measures are frequently used by shareholders to evaluate a company, they have limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of results reported under GAAP.


    Primary Logo

シェアする