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BancFirst Corp. Reports Operating Results (10-Q)

May 10, 2010 | About:
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10qk

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BancFirst Corp. (BANF) filed Quarterly Report for the period ended 2010-03-31.

Bancfirst Corp. has a market cap of $620.73 million; its shares were traded at around $40.52 with a P/E ratio of 18.17 and P/S ratio of 2.62. The dividend yield of Bancfirst Corp. stocks is 2.27%. Bancfirst Corp. had an annual average earning growth of 5.1% over the past 10 years.BANF is in the portfolios of Jim Simons of Renaissance Technologies LLC, Chuck Royce of Royce& Associates.

Highlight of Business Operations:

Net interest income for the first quarter of 2010 was $33.9 million, compared to $31.8 million for the first quarter of 2009. The Companys net interest margin was 3.38% the first quarter of 2010 down 31 basis points from 3.69% for the first quarter of 2009. The decrease is due to lower interest rates brought about by a slowing national economy, reflected in the national unemployment rate reaching 10%. Provision for loan losses was $896,000 for the first quarter of 2010 compared to $3.4 million for the first quarter of 2009. Noninterest income was $16.0 million for the first quarter of 2010 compared to $16.6 million for the first quarter of 2009, while noninterest expense was $34.9 million for the first quarter of 2010 compared to $34.5 million for the first quarter of 2009.

Total assets at March 31, 2010 were $4.5 billion, up $551 million or 13.9% from a year ago. Compared to year end 2009, total assets grew by $93 million from $4.4 billion. Total loans at March 31, 2010 were $2.8 billion, a decrease of $42 million or 1.5% from March 31, 2009, compared to an increase of $28 million from December 31, 2009. At March 31, 2010 total deposits were $4.0 billion, up $538 million or 15.5% from March 31, 2009 and up $80 million from December 31, 2009. The Companys liquidity remains strong as its average loan-to-deposit ratio was 70.1% at March 31, 2010 compared to 83.3% at March 31, 2009. Stockholders equity was $437 million as of March 31, 2010, an increase of $21 million from March 31, 2009 and $6 million from December 31, 2009. Average stockholders equity to average assets was 9.86% at March 31, 2010, compared to 10.85% at March 31, 2009. The Companys borrowings include no brokered deposits and no Federal Home Loan Bank borrowings at March 31, 2010.

Net interest income, which is the Companys principal source of operating revenue, totaled $33.9 million for the first quarter of 2010, an increase of $2.1 million, or 6.6%, compared to the first quarter of 2009. Net interest income for the first quarter of 2010 included nonrecurring interest income on nonaccrual loans of $360,000. The Companys net interest margin on a taxable equivalent basis for the first quarter of 2010 was 3.38% compared to 3.69% for the same period a year ago. The lower interest rate environment in 2010 compared to a year ago has caused the Companys net interest margin to decline. In addition, an increase in earning assets and a higher level of overnight investments at lower rates caused further compression of the net interest margin. This compression was somewhat offset by the implementation of interest rate floors on loans implemented during 2009. If interest rates do not increase, the Company could experience continued compression of its net interest margin in 2010 as higher rate assets mature in a continued low interest rate environment. Furthermore, due to the interest rate floors implemented, short-term interest rates would have to increase approximately 100 basis points before the Companys loan portfolio would experience a measurable increase in yield. From March 31, 2009 earning assets increased $574 million to $4.1 billion. During the quarter, the Companys net interest margin experienced a volume variance of negative $1.4 million offset by a positive rate variance of $3.5 million due to lower interest expense on deposits.

At March 31, 2010, noninterest expense was $34.9 million up $372,000 from $34.5 million for the same period last year. Noninterest expense rose slightly due to higher FDIC insurance premium of $675,000 and acquisition expenses of $389,000 offset by lower other operating expense.

For the quarter ended March 31, 2010, total loans were approximately $2.8 billion, up $28 million or 1.0% from December 31, 2009 and down $42 million or 1.5% from March 31, 2009. The allowance for loan losses remained constant at $36.8 million compared to the first quarter of 2009, and increased slightly by $397,000 or 1.1% from year-end 2009. The allowance as a percentage of total loans was 1.33%, 1.33% and 1.31% at March 31, 2010, December 31, 2009 and March 31, 2009, respectively. The allowance to nonperforming and restructured loans at the same dates was 91.3%, 91.1% and 138.9%, respectively.

At March 31, 2010 total deposits were $4.0 billion, an increase of $538 million or 15.5% from March 31, 2009 and $80 million or 2.0% from December 31, 2009. The increase from March 31, 2009 was due largely to overnight sweep funds that moved into low-rate interest-bearing transaction accounts due to low interest rates on money market funds. These deposits were insured because the Company participated in the TAGP and will continue to do so until June 30, 2010. The Companys core deposits provide it with a stable, low-cost funding source. The Companys deposit base continues to be comprised substantially of core deposits, with large denomination certificates of deposit being only 9.4% of total deposits at March 31, 2010, compared to 9.7% at December 31, 2009 and 10.5% at March 31, 2009. The TAGP will expire on June 30, 2010. At March 31, 2010 the Company held approximately $600 million of deposits covered under TAGP. Some of the deposits currently insured by the TAGP could move back into money market funds or to other depository institutions.

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