Bay Street News

HBT Financial, Inc. Announces First Quarter 2024 Financial Results

First Quarter Highlights

BLOOMINGTON, Ill., April 22, 2024 (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 $15.3 million, or $0.48 diluted earnings per share, for the first quarter of 2024. This compares to net income of $18.4 million, or $0.58 diluted earnings per share, for the fourth quarter of 2023, and net income of $9.2 million, or $0.30 diluted earnings per share, for the first quarter of 2023.

J. Lance Carter, President and Chief Executive Officer of HBT Financial, said, “This has been an excellent start to 2024 as we continue to show the strength of our franchise. Our profitability remained very strong with an adjusted ROAA(1) of 1.45% and an adjusted ROATCE(1) of 17.57%. Our net interest margin (tax-equivalent basis)(1) was stable at 3.99%, as the increase in funding costs has slowed. Deposits, excluding brokered deposits, increased slightly during the quarter while loans had a small decline. The decrease in loans included the payoff of several loans that had interest rates lower than the current yield on cash, so it did not have a material impact on profitability. Credit quality has remained strong, as evidenced by a net recovery for the quarter and nonperforming loans to total assets still being near a historic low. Despite an increase in interest rates having a negative impact on accumulated other comprehensive income (loss) during the quarter, we saw increases to all capital ratios and an increase to tangible book value per share(1) by $0.29. Tangible book value per share(1) has now grown by $1.74, or 15.2%, since March 31, 2023.”
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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 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 $18.1 million, or $0.57 adjusted diluted earnings per share, for the first quarter of 2024. This compares to adjusted net income of $19.3 million, or $0.60 adjusted diluted earnings per share, for the fourth quarter of 2023, and adjusted net income of $19.9 million, or $0.64 adjusted diluted earnings per share, for the first quarter of 2023 (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 first quarter of 2024 was $46.7 million, a decrease of 0.8% from $47.1 million for the fourth quarter of 2023. The slight decrease was primarily attributable to an increase in funding costs, which were partially offset by an increase in asset yields. The increase in asset yields was primarily driven by higher cash balances following the sale of $66.8 million of municipal securities as well as higher loan yields. The book yield of the securities sold was 1.87% and the average life was 6.7 years.

Relative to the first quarter of 2023, net interest income decreased 0.3% from $46.8 million. The slight decrease was primarily attributable to an increase in funding costs, which were mostly offset by higher interest-earning asset balances following the Town and Country Financial Corporation (“Town and Country”) merger, which closed on February 1, 2023, and higher yields on interest-earning assets.

Net interest margin for the first quarter of 2024 was 3.94%, compared to 3.93% for the fourth quarter of 2023, and net interest margin (tax-equivalent basis)(1) for the first quarter of 2024 was 3.99%, unchanged from the fourth quarter of 2023. Higher yields on interest-earning assets were offset by higher funding costs with the cost of funds increasing to 1.37% for the first quarter of 2024, compared to 1.26% for the fourth quarter of 2023.

Relative to the first quarter of 2023, net interest margin decreased from 4.20% and net interest margin (tax-equivalent basis)(1) decreased from 4.26%. These decreases were primarily attributable to increases in funding costs outpacing increases in interest-earning asset yields.
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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 first quarter of 2024 was $5.6 million, a decrease of 38.9% from $9.2 million for the fourth quarter of 2023. The decrease was primarily attributable to $3.4 million in realized losses on the sale of securities during the first quarter of 2024 and $0.6 million of impairment losses on bank premises related to the closure of two branch premises now held for sale. Partially offsetting these losses were changes in the mortgage servicing rights fair value adjustment, with a $0.1 million positive fair value adjustment during the first quarter of 2024 compared to a $1.2 million negative fair value adjustment during the fourth quarter of 2023.

Relative to the first quarter of 2023, noninterest income decreased 24.4% from $7.4 million. The decrease was primarily attributable to the $3.4 million in realized losses on the sales of securities in the first quarter of 2024 compared to $1.0 million in realized losses on the sale of securities in the first quarter of 2023.

Noninterest Expense

Noninterest expense for the first quarter of 2024 was $31.3 million, a 2.9% increase from $30.4 million for the fourth quarter of 2023. The increase was primarily attributable to a $0.9 million increase in salaries, which was impacted by seasonal variations in vacation accruals, annual merit increases that were effective at the beginning of March, and the refresh of annual payroll tax limitations. Additionally, the $0.4 million increase in employee benefit expenses was primarily attributable to higher medical benefit costs.

Relative to the first quarter of 2023, noninterest expense decreased 13.0% from $35.9 million, primarily attributable to the absence of $7.1 million of Town and Country acquisition-related expenses, partially offset by an increase in salaries and benefits expenses.

Acquisition-related expenses recognized during the first quarter of 2023 are summarized below. No Town and Country acquisition-related expenses were recognized subsequent to the second quarter of 2023.

(dollars in thousands) Three Months Ended
March 31, 2023
   
PROVISION FOR CREDIT LOSSES $ 5,924
NONINTEREST EXPENSE  
Salaries   3,518
Data processing   1,855
Marketing and customer relations   14
Legal fees and other noninterest expense   1,753
Total noninterest expense   7,140
Total acquisition-related expenses $ 13,064


Loan Portfolio

Total loans outstanding, before allowance for credit losses, were $3.35 billion at March 31, 2024, compared with $3.40 billion at December 31, 2023 and $3.20 billion at March 31, 2023. The $58.5 million decrease from December 31, 2023 reflected a decrease in line utilization on existing lines of credit by $28.3 million, including $13.2 million drawn by two customers’ lines that paid off shortly after December 31, 2023 and were noted in the previous quarter’s earnings release. Additionally, across the portfolio, early payoffs of loans maturing or repricing beyond 2024 with fixed rates of 4.00% or less totaled $14.4 million. Construction and land development loans decreased by $18.0 million with several completed projects shifting to other loan categories. Although grain elevator loans increased $5.7 million during the first quarter of 2024, seasonal line utilization was significantly lower relative to historical levels.

Deposits

Total deposits were $4.36 billion at March 31, 2024, compared with $4.40 billion at December 31, 2023 and $4.31 billion at March 31, 2023. The $40.9 million decrease from December 31, 2023 was primarily attributable to a $89.1 million decrease in brokered deposits, which was partially offset by the addition of $33.9 million of time deposits from a State of Illinois loan matching program that are a lower cost source of funding.

Asset Quality

Nonperforming loans totaled $9.7 million, or 0.29% of total loans, at March 31, 2024, compared with $7.9 million, or 0.23% of total loans, at December 31, 2023, and $6.5 million, or 0.20% of total loans, at March 31, 2023. Additionally, of the $9.7 million of nonperforming loans held as of March 31, 2024, $2.7 million is either wholly or partially guaranteed by the U.S. government. The $1.8 million increase in nonperforming loans from December 31, 2023 was primarily attributable to the movement of a few commercial and industrial and commercial real estate – owner occupied credits to nonaccrual status.

The Company recorded a provision for credit losses of $0.5 million for the first quarter of 2024. The provision for credit losses primarily reflects a $3.7 million increase in required reserves resulting from changes in qualitative factors, a $2.1 million decrease in required reserves resulting from changes in economic forecasts, a $1.0 million decrease in required reserves driven by a reduction in loan portfolio balances, and a $0.1 million decrease in specific reserve.

The Company had net recoveries of $0.2 million, or 0.02% of average loans on an annualized basis, for the first quarter of 2024, compared to net charge-offs of $0.5 million, or 0.06% of average loans on an annualized basis, for the fourth quarter of 2023, and net recoveries of $0.1 million, or 0.02% of average loans on an annualized basis, for the first quarter of 2023.

The Company’s allowance for credit losses was 1.22% of total loans and 423% of nonperforming loans at March 31, 2024, compared with 1.18% of total loans and 510% of nonperforming loans at December 31, 2023. In addition, the allowance for credit losses on unfunded lending-related commitments totaled $3.8 million as of March 31, 2024, compared with $3.8 million as of December 31, 2023.

Capital

The ratio of tangible common equity to tangible assets(1) increased to 8.40% as of March 31, 2024, from 8.19% as of December 31, 2023, and tangible book value per share(1) increased by $0.29 to $13.19 as of March 31, 2024, when compared to December 31, 2023.

During the first quarter of 2024, the Company repurchased 179,281 shares of its common stock at a weighted average price of $18.93 under its stock repurchase program. The Company’s Board of Directors has authorized the repurchase of up to $15 million of HBT Financial common stock under its stock repurchase program, which is in effect until January 1, 2025. As of March 31, 2024, the Company had $11.6 million remaining under the stock repurchase program.
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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.

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 Financial provides a comprehensive suite of financial products and services to consumers, businesses, and municipal entities throughout Illinois and eastern Iowa through 66 full-service branches. As of March 31, 2024, HBT Financial had total assets of $5.0 billion, total loans of $3.3 billion, and total deposits of $4.4 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), ratio of tangible common equity to tangible assets, tangible book value per share, ROATCE, adjusted net income, adjusted earnings per share, adjusted ROAA, adjusted ROAE, and adjusted ROATCE. 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, 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 Financial Accounting Standards Board or the Public Company Accounting Oversight Board; (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 or as a result of the upcoming 2024 presidential election; (v) changes in interest rates and prepayment rates of the Company’s assets (including the effects of significant rate increases by the Federal Reserve since 2020); (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) 664-4556

HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
    As of or for the Three Months Ended
(dollars in thousands, except per share data)   March 31,
2024
  December 31,
2023
  March 31,
2023
Interest and dividend income   $ 61,961     $ 61,411     $ 51,779  
Interest expense     15,273       14,327       4,942  
Net interest income     46,688       47,084       46,837  
Provision for credit losses     527       1,113       6,210  
Net interest income after provision for credit losses     46,161       45,971       40,627  
Noninterest income     5,626       9,205       7,437  
Noninterest expense     31,268       30,387       35,933  
Income before income tax expense     20,519       24,789       12,131  
Income tax expense     5,261       6,343       2,923  
Net income   $ 15,258     $ 18,446     $ 9,208  
             
Earnings per share – Diluted   $ 0.48     $ 0.58     $ 0.30  
             
Adjusted net income (1)   $ 18,073     $ 19,272     $ 19,859  
Adjusted earnings per share – Diluted (1)     0.57       0.60       0.64  
             
Book value per share   $ 15.71     $ 15.44     $ 14.02  
Tangible book value per share (1)     13.19       12.90       11.45  
             
Shares of common stock outstanding     31,612,888       31,695,828       32,095,370  
Weighted average shares of common stock outstanding     31,662,954       31,708,381       30,977,204  
             
SUMMARY RATIOS            
Net interest margin *     3.94  %     3.93  %     4.20  %
Net interest margin (tax-equivalent basis) * (1)(2)     3.99       3.99       4.26  
             
Efficiency ratio     58.41  %     52.70  %     65.27  %
Efficiency ratio (tax-equivalent basis) (1)(2)     57.78       52.09       64.43  
             
Loan to deposit ratio     76.73  %     77.35  %     74.13  %
             
Return on average assets *     1.23  %     1.46  %     0.78  %
Return on average stockholders’ equity *     12.42       15.68       8.84  
Return on average tangible common equity * (1)     14.83       18.96       10.45  
             
Adjusted return on average assets * (1)     1.45  %     1.53  %     1.69  %
Adjusted return on average stockholders’ equity * (1)     14.72       16.38       19.08  
Adjusted return on average tangible common equity * (1)     17.57       19.81       22.55  
             
CAPITAL            
Total capital to risk-weighted assets     15.79  %     15.33  %     15.11  %
Tier 1 capital to risk-weighted assets     13.77       13.42       13.16  
Common equity tier 1 capital ratio     12.44       12.12       11.79  
Tier 1 leverage ratio     10.65       10.49       10.29  
Total stockholders’ equity to total assets     9.85       9.65       8.98  
Tangible common equity to tangible assets (1)     8.40       8.19       7.45  
             
ASSET QUALITY            
Net charge-offs (recoveries) to average loans     (0.02 )%     0.06  %     (0.02 )%
Allowance for credit losses to loans, before allowance for credit losses     1.22       1.18       1.21  
Nonperforming loans to loans, before allowance for credit losses     0.29       0.23       0.20  
Nonperforming assets to total assets     0.20       0.17       0.20  
 

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
(dollars in thousands, except per share data)   March 31,
2024
  December 31,
2023
  March 31,
2023
INTEREST AND DIVIDEND INCOME            
Loans, including fees:            
Taxable   $ 51,926     $ 52,060     $ 42,159  
Federally tax exempt     1,094       1,125       952  
Securities:            
Taxable     6,250       6,377       6,616  
Federally tax exempt     597       888       1,197  
Interest-bearing deposits in bank     1,952       786       739  
Other interest and dividend income     142       175       116  
Total interest and dividend income     61,961       61,411       51,779  
INTEREST EXPENSE            
Deposits     13,593       11,227       2,374  
Securities sold under agreements to repurchase     152       148       38  
Borrowings     125       1,534       1,297  
Subordinated notes     470       470       470  
Junior subordinated debentures issued to capital trusts     933       948       763  
Total interest expense     15,273       14,327       4,942  
Net interest income     46,688       47,084       46,837  
PROVISION FOR CREDIT LOSSES     527       1,113       6,210  
Net interest income after provision for credit losses     46,161       45,971       40,627  
NONINTEREST INCOME            
Card income     2,616       2,717       2,658  
Wealth management fees     2,547       2,885       2,338  
Service charges on deposit accounts     1,869       2,016       1,871  
Mortgage servicing     1,055       1,156       1,099  
Mortgage servicing rights fair value adjustment     80       (1,155 )     (624 )
Gains on sale of mortgage loans     298       401       276  
Realized gains (losses) on sales of securities     (3,382 )           (1,007 )
Unrealized gains (losses) on equity securities     (16 )     221       (22 )
Gains (losses) on foreclosed assets     87       58       (10 )
Gains (losses) on other assets     (635 )     5        
Income on bank owned life insurance     164       158       115  
Other noninterest income     943       743       743  
Total noninterest income     5,626       9,205       7,437  
NONINTEREST EXPENSE            
Salaries     16,657       15,738       19,411  
Employee benefits     2,805       2,379       2,335  
Occupancy of bank premises     2,582       2,458       2,102  
Furniture and equipment     550       655       659  
Data processing     2,925       2,565       4,323  
Marketing and customer relations     996       1,169       836  
Amortization of intangible assets     710       720       510  
FDIC insurance     560       575       563  
Loan collection and servicing     452       431       278  
Foreclosed assets     49       17       61  
Other noninterest expense     2,982       3,680       4,855  
Total noninterest expense     31,268       30,387       35,933  
INCOME BEFORE INCOME TAX EXPENSE     20,519       24,789       12,131  
INCOME TAX EXPENSE     5,261       6,343       2,923  
NET INCOME   $ 15,258     $ 18,446     $ 9,208  
             
EARNINGS PER SHARE – BASIC   $ 0.48     $ 0.58     $ 0.30  
EARNINGS PER SHARE – DILUTED   $ 0.48     $ 0.58     $ 0.30  
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING     31,662,954       31,708,381       30,977,204  
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
Consolidated Balance Sheets
 
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
ASSETS            
Cash and due from banks   $ 19,989     $ 26,256     $ 35,244  
Interest-bearing deposits with banks     240,223       114,996       141,868  
Cash and cash equivalents     260,212       141,252       177,112  
             
Interest-bearing time deposits with banks     515       509       249  
Debt securities available-for-sale, at fair value     669,020       759,461       854,622  
Debt securities held-to-maturity     517,472       521,439       536,429  
Equity securities with readily determinable fair value     3,324       3,360       3,145  
Equity securities with no readily determinable fair value     2,622       2,505       1,980  
Restricted stock, at cost     5,155       7,160       4,991  
Loans held for sale     3,479       2,318       5,130  
             
Loans, before allowance for credit losses     3,345,962       3,404,417       3,195,540  
Allowance for credit losses     (40,815 )     (40,048 )     (38,776 )
Loans, net of allowance for credit losses     3,305,147       3,364,369       3,156,764  
             
Bank owned life insurance     24,069       23,905       23,447  
Bank premises and equipment, net     64,755       65,150       65,119  
Bank premises held for sale     317             235  
Foreclosed assets     277       852       3,356  
Goodwill     59,820       59,820       59,876  
Intangible assets, net     19,972       20,682       22,842  
Mortgage servicing rights, at fair value     19,081       19,001       19,992  
Investments in unconsolidated subsidiaries     1,614       1,614       1,614  
Accrued interest receivable     23,117       24,534       20,301  
Other assets     60,542       55,239       56,617  
Total assets   $ 5,040,510     $ 5,073,170     $ 5,013,821  
             
LIABILITIES AND STOCKHOLDERS’ EQUITY            
Liabilities            
Deposits:            
Noninterest-bearing   $ 1,047,074     $ 1,072,407     $ 1,218,888  
Interest-bearing     3,313,500       3,329,030       3,091,633  
Total deposits     4,360,574       4,401,437       4,310,521  
             
Securities sold under agreements to repurchase     31,864       42,442       34,919  
Federal Home Loan Bank advances     12,725       12,623       75,183  
Subordinated notes     39,494       39,474       39,415  
Junior subordinated debentures issued to capital trusts     52,804       52,789       52,746  
Other liabilities     46,368       34,909       50,939  
Total liabilities     4,543,829       4,583,674       4,563,723  
             
Stockholders’ Equity            
Common stock     328       327       327  
Surplus     296,054       295,877       294,441  
Retained earnings     278,353       269,051       228,782  
Accumulated other comprehensive income (loss)     (56,048 )     (57,163 )     (62,175 )
Treasury stock at cost     (22,006 )     (18,596 )     (11,277 )
Total stockholders’ equity     496,681       489,496       450,098  
Total liabilities and stockholders’ equity   $ 5,040,510     $ 5,073,170     $ 5,013,821  
SHARES OF COMMON STOCK OUTSTANDING     31,612,888       31,695,828       32,095,370  
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
LOANS            
Commercial and industrial   $ 402,206     $ 427,800     $ 333,013  
Commercial real estate – owner occupied     294,967       295,842       317,103  
Commercial real estate – non-owner occupied     890,251       880,681       854,024  
Construction and land development     345,991       363,983       389,142  
Multi-family     421,573       417,923       362,672  
One-to-four family residential     485,948       491,508       482,732  
Agricultural and farmland     287,205       287,294       243,357  
Municipal, consumer, and other     217,821       239,386       213,497  
Total loans   $ 3,345,962     $ 3,404,417     $ 3,195,540  
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
DEPOSITS            
Noninterest-bearing deposits   $ 1,047,074     $ 1,072,407     $ 1,218,888  
Interest-bearing deposits:            
Interest-bearing demand     1,139,172       1,145,092       1,270,454  
Money market     802,685       803,381       662,088  
Savings     602,739       608,424       738,719  
Time     713,142       627,253       420,372  
Brokered     55,762       144,880        
Total interest-bearing deposits     3,313,500       3,329,030       3,091,633  
Total deposits   $ 4,360,574     $ 4,401,437     $ 4,310,521  
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
 
    Three Months Ended
    March 31, 2024   December 31, 2023   March 31, 2023
(dollars in thousands)   Average
Balance
  Interest   Yield/Cost *   Average
Balance
  Interest   Yield/Cost *   Average
Balance
  Interest   Yield/Cost *
ASSETS                                    
Loans   $ 3,371,219     $ 53,020     6.33  %   $ 3,374,451     $ 53,185     6.25  %   $ 3,012,320     $ 43,111     5.80  %
Securities     1,221,447       6,847     2.25       1,282,773       7,265     2.25       1,411,613       7,813     2.24  
Deposits with banks     167,297       1,952     4.69       84,021       786     3.71       92,363       739     3.24  
Other     5,486       142     10.40       7,505       175     9.23       7,425       116     6.33  
Total interest-earning assets     4,765,449     $ 61,961     5.23  %     4,748,750     $ 61,411     5.13  %     4,523,721     $ 51,779     4.64  %
Allowance for credit losses     (40,238 )             (38,844 )             (33,301 )        
Noninterest-earning assets     278,253               292,543               274,870          
Total assets   $ 5,003,464             $ 5,002,449             $ 4,765,290          
                                     
LIABILITIES AND STOCKHOLDERS’ EQUITY                                    
Liabilities                                    
Interest-bearing deposits:                                    
Interest-bearing demand   $ 1,127,684     $ 1,311     0.47  %   $ 1,140,438     $ 1,228     0.43  %   $ 1,230,644     $ 458     0.15  %
Money market     812,684       4,797     2.37       684,197       2,885     1.67       634,608       935     0.60  
Savings     611,224       443     0.29       610,767       417     0.27       709,862       178     0.10  
Time     664,498       5,925     3.59       599,293       4,773     3.16       356,779       803     0.91  
Brokered     82,150       1,117     5.47       140,963       1,924     5.42                  
Total interest-bearing deposits     3,298,240       13,593     1.66       3,175,658       11,227     1.40       2,931,893       2,374     0.33  
Securities sold under agreements to repurchase     32,456       152     1.89       34,282       148     1.71       39,619       38     0.38  
Borrowings     13,003       125     3.87       114,220       1,534     5.33       113,896       1,297     4.62  
Subordinated notes     39,484       470     4.78       39,464       470     4.72       39,403       470     4.83  
Junior subordinated debentures issued to capital trusts     52,796       933     7.11       52,782       948     7.13       47,586       763     6.50  
Total interest-bearing liabilities     3,435,979     $ 15,273     1.79  %     3,416,406     $ 14,327     1.66  %     3,172,397     $ 4,942     0.63  %
Noninterest-bearing deposits     1,036,402               1,081,795               1,121,365          
Noninterest-bearing liabilities     37,107               37,440               49,316          
Total liabilities     4,509,488               4,535,641               4,343,078          
Stockholders’ Equity     493,976               466,808               422,212          
Total liabilities and stockholders’ equity   $ 5,003,464             $ 5,002,449             $ 4,765,290          
                                     
Net interest income/Net interest margin (1)       $ 46,688     3.94  %       $ 47,084     3.93  %       $ 46,837     4.20  %
Tax-equivalent adjustment (2)         575     0.05           666     0.06           702     0.06  
Net interest income (tax-equivalent basis)/
Net interest margin (tax-equivalent basis) (2) (3)
      $ 47,263     3.99  %       $ 47,750     3.99  %       $ 47,539     4.26  %
Net interest rate spread (4)           3.44  %           3.47  %           4.01  %
Net interest-earning assets (5)   $ 1,329,470             $ 1,332,344             $ 1,351,324          
Ratio of interest-earning assets to interest-bearing liabilities     1.39               1.39               1.43          
Cost of total deposits           1.26  %           1.05  %           0.24  %
Cost of funds           1.37             1.26             0.47  
 

* 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)   March 31,
2024
  December 31,
2023
  March 31,
2023
NONPERFORMING ASSETS            
Nonaccrual   $ 9,657     $ 7,820     $ 6,508  
Past due 90 days or more, still accruing           37       10  
Total nonperforming loans     9,657       7,857       6,518  
Foreclosed assets     277       852       3,356  
Total nonperforming assets   $ 9,934     $ 8,709     $ 9,874  
             
Nonperforming loans that are wholly or partially guaranteed by the U.S. Government   $ 2,676     $ 2,641     $ 1,997  
             
Allowance for credit losses   $ 40,815     $ 40,048     $ 38,776  
Loans, before allowance for credit losses     3,345,962       3,404,417       3,195,540  
             
CREDIT QUALITY RATIOS            
Allowance for credit losses to loans, before allowance for credit losses     1.22  %     1.18  %     1.21  %
Allowance for credit losses to nonaccrual loans     422.65       512.12       595.82  
Allowance for credit losses to nonperforming loans     422.65       509.71       594.91  
Nonaccrual loans to loans, before allowance for credit losses     0.29       0.23       0.20  
Nonperforming loans to loans, before allowance for credit losses     0.29       0.23       0.20  
Nonperforming assets to total assets     0.20       0.17       0.20  
Nonperforming assets to loans, before allowance for credit losses, and foreclosed assets     0.30       0.26       0.31  
HBT Financial, Inc.
Unaudited Consolidated Financial Summary
    Three Months Ended
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
ALLOWANCE FOR CREDIT LOSSES            
Beginning balance   $ 40,048     $ 38,863     $ 25,333  
Adoption of ASC 326                 6,983  
PCD allowance established in acquisition                 1,247  
Provision for credit losses     560       1,661       5,101  
Charge-offs     (227 )     (626 )     (142 )
Recoveries     434       150       254  
Ending balance   $ 40,815     $ 40,048     $ 38,776  
             
Net charge-offs (recoveries)   $ (207 )   $ 476     $ (112 )
Average loans     3,371,219       3,374,451       3,012,320  
             
Net charge-offs (recoveries) to average loans *     (0.02 )%     0.06  %     (0.02 )%
 

* Annualized measure.

    Three Months Ended
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
PROVISION FOR CREDIT LOSSES            
Loans (1)   $ 560     $ 1,661     $ 5,101  
Unfunded lending-related commitments (1)     (33 )     (548 )     509  
Debt securities                 600  
Total provision for credit losses   $ 527     $ 1,113     $ 6,210  
 

(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
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
Net income   $ 15,258     $ 18,446     $ 9,208  
Adjustments:            
Acquisition expenses (1)                 (13,064 )
Gains (losses) on closed branch premises     (635 )            
Realized gains (losses) on sales of securities     (3,382 )           (1,007 )
Mortgage servicing rights fair value adjustment     80       (1,155 )     (624 )
Total adjustments     (3,937 )     (1,155 )     (14,695 )
Tax effect of adjustments     1,122       329       4,044  
Total adjustments after tax effect     (2,815 )     (826 )     (10,651 )
Adjusted net income   $ 18,073     $ 19,272     $ 19,859  
             
Average assets   $ 5,003,464     $ 5,002,449     $ 4,765,290  
             
Return on average assets *     1.23  %     1.46  %     0.78  %
Adjusted return on average assets *     1.45       1.53       1.69  
 

* 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 — Basic and Diluted
 
    Three Months Ended
(dollars in thousands, except per share amounts)   March 31,
2024
  December 31,
2023
  March 31,
2023
Numerator:            
Net income   $ 15,258     $ 18,446     $ 9,208  
Earnings allocated to participating securities (1)           (10 )     (5 )
Numerator for earnings per share – basic and diluted   $ 15,258     $ 18,436     $ 9,203  
             
Adjusted net income   $ 18,073     $ 19,272     $ 19,859  
Earnings allocated to participating securities (1)           (9 )     (13 )
Numerator for adjusted earnings per share – basic and diluted   $ 18,073     $ 19,263     $ 19,846  
             
Denominator:            
Weighted average common shares outstanding     31,662,954       31,708,381       30,977,204  
Dilutive effect of outstanding restricted stock units     140,233       139,332       69,947  
Weighted average common shares outstanding, including all dilutive potential shares     31,803,187       31,847,713       31,047,151  
             
Earnings per share – Basic   $ 0.48     $ 0.58     $ 0.30  
Earnings per share – Diluted   $ 0.48     $ 0.58     $ 0.30  
             
Adjusted earnings per share – Basic   $ 0.57     $ 0.61     $ 0.64  
Adjusted earnings per share – Diluted   $ 0.57     $ 0.60     $ 0.64  
 

(1) The Company previously granted restricted stock units that contain non-forfeitable rights to dividend equivalents, which were considered participating securities. Prior to 2024, these restricted stock units were included in the calculation of 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 (Tax-equivalent Basis) and Net Interest Margin (Tax-equivalent Basis)
 
    Three Months Ended
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
Net interest income (tax-equivalent basis)            
Net interest income   $ 46,688     $ 47,084     $ 46,837  
Tax-equivalent adjustment (1)     575       666       702  
Net interest income (tax-equivalent basis) (1)   $ 47,263     $ 47,750     $ 47,539  
             
Net interest margin (tax-equivalent basis)            
Net interest margin *     3.94  %     3.93  %     4.20  %
Tax-equivalent adjustment * (1)     0.05       0.06       0.06  
Net interest margin (tax-equivalent basis) * (1)     3.99  %     3.99  %     4.26  %
             
Average interest-earning assets   $ 4,765,449     $ 4,748,750     $ 4,523,721  
 

* 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
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
Efficiency ratio (tax-equivalent basis)            
Total noninterest expense   $ 31,268     $ 30,387     $ 35,933  
Less: amortization of intangible assets     710       720       510  
Noninterest expense excluding amortization of intangible assets   $ 30,558     $ 29,667     $ 35,423  
             
Net interest income   $ 46,688     $ 47,084     $ 46,837  
Total noninterest income     5,626       9,205       7,437  
Operating revenue     52,314       56,289       54,274  
Tax-equivalent adjustment (1)     575       666       702  
Operating revenue (tax-equivalent basis) (1)   $ 52,889     $ 56,955     $ 54,976  
             
Efficiency ratio     58.41  %     52.70  %     65.27  %
Efficiency ratio (tax-equivalent basis) (1)     57.78       52.09       64.43  
 

(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 –
Ratio of Tangible Common Equity to Tangible Assets and Tangible Book Value Per Share
 
(dollars in thousands, except per share data)   March 31,
2024
  December 31,
2023
  March 31,
2023
Tangible Common Equity            
Total stockholders’ equity   $ 496,681     $ 489,496     $ 450,098  
Less: Goodwill     59,820       59,820       59,876  
Less: Intangible assets, net     19,972       20,682       22,842  
Tangible common equity   $ 416,889     $ 408,994     $ 367,380  
             
Tangible Assets            
Total assets   $ 5,040,510     $ 5,073,170     $ 5,013,821  
Less: Goodwill     59,820       59,820       59,876  
Less: Intangible assets, net     19,972       20,682       22,842  
Tangible assets   $ 4,960,718     $ 4,992,668     $ 4,931,103  
             
Total stockholders’ equity to total assets     9.85  %     9.65  %     8.98  %
Tangible common equity to tangible assets     8.40       8.19       7.45  
             
Shares of common stock outstanding     31,612,888       31,695,828       32,095,370  
             
Book value per share   $ 15.71     $ 15.44     $ 14.02  
Tangible book value per share     13.19       12.90       11.45  
Reconciliation of Non-GAAP Financial Measures –
Return on Average Tangible Common Equity,
Adjusted Return on Average Stockholders’ Equity and Adjusted Return on Average Tangible Common Equity
 
    Three Months Ended
(dollars in thousands)   March 31,
2024
  December 31,
2023
  March 31,
2023
Average Tangible Common Equity            
Total stockholders’ equity   $ 493,976     $ 466,808     $ 422,212  
Less: Goodwill     59,820       59,820       49,352  
Less: Intangible assets, net     20,334       21,060       15,635  
Average tangible common equity   $ 413,822     $ 385,928     $ 357,225  
             
Net income   $ 15,258     $ 18,446     $ 9,208  
Adjusted net income     18,073       19,272       19,859  
             
Return on average stockholders’ equity *     12.42  %     15.68  %     8.84  %
Return on average tangible common equity *     14.83       18.96       10.45  
             
Adjusted return on average stockholders’ equity *     14.72  %     16.38  %     19.08  %
Adjusted return on average tangible common equity *     17.57       19.81       22.55  
 

* Annualized measure.


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