BIRMINGHAM, Ala., Jan. 22, 2019 (GLOBE NEWSWIRE) — ServisFirst Bancshares, Inc. (NASDAQ: SFBS), today announced earnings and operating results for the quarter and year ended December 31, 2018.

Fourth Quarter 2018 Highlights:

• Assets exceed $8 billion at year end 2018
• Diluted EPS increased 47% from $1.72 to $2.53 year over year
• Deposits increased 25% on an annualized basis for the quarter and 14% year over year
• Increased dividend to $0.15 per share, a 36% increase
• Loans increased 12% year over year

Tom Broughton, President and CEO, said, “Our strong organic growth continues for the 13^th year, with assets now exceeding $8 billion.”  Bud Foshee, CFO, added, “Our strong organic growth continued in the fourth quarter as a result of our bank’s focus on developing new and existing relationships.”

FINANCIAL SUMMARY (UNAUDITED)
(in Thousands except share and per share amounts)
			Period Ending December 31, 2018				Period Ending September 30, 2018				% Change From Period Ending September 30, 2018 to Period Ending December 31, 2018			Period Ending December 31, 2017				% Change From Period Ending December 31, 2017 to Period Ending December 31, 2018
QUARTERLY OPERATING RESULTS
Net Income			$	36,237			$	34,560			5	%		$	21,150			71	%
Net Income Available to Common Stockholders			$	36,205			$	34,560			5	%		$	21,119			71	%
Diluted Earnings Per Share			$	0.67			$	0.64			5	%		$	0.39			72	%
Return on Average Assets				1.85	%			1.87	%						1.20	%
Return on Average Common Stockholders’ Equity				21.13	%			20.42	%						13.97	%
Average Diluted Shares Outstanding				54,109,450				54,191,222							54,161,788
Net Income – adjusted for non-routine expenses *			$	36,237										$	24,424			48	%
Net Income Available to Common Stockholders – adjusted for
	non-routine expenses*		$	36,205										$	24,393			48	%
Diluted Earnings Per Share – adjusted for non-routine expenses *			$	0.67										$	0.45			49	%
Return on Average Assets – adjusted for non-routine expenses *				1.85	%										1.39	%
Return on Average Common Stockholders’ Equity – adjusted for
	non-routine expenses*			21.13	%										16.13	%
YEAR-TO-DATE OPERATING RESULTS
Net Income			$	136,940										$	93,092			47	%
Net Income Available to Common Stockholders			$	136,877										$	93,030			47	%
Diluted Earnings Per Share			$	2.53										$	1.72			47	%
Return on Average Assets				1.88	%										1.43	%
Return on Average Common Stockholders’ Equity				20.95	%										16.37	%
Average Diluted Shares Outstanding				54,169,879											54,123,957
Net Income – adjusted for non-routine expenses *			$	136,940										$	96,366			42	%
Net Income Available to Common Stockholders – adjusted for
	non-routine expenses*		$	136,877										$	96,304			42	%
Diluted Earnings Per Share – adjusted for non-routine expenses *			$	2.53										$	1.78			42	%
Return on Average Assets – adjusted for non-routine expenses *				1.88	%										1.48	%
Return on Average Common Stockholders’ Equity – adjusted for
	non-routine expenses*			20.95	%										16.95	%
BALANCE SHEET
Total Assets			$	8,007,382			$	7,517,833			7	%		$	7,082,384			13	%
Loans				6,533,499				6,363,531			3	%			5,851,261			12	%
Non-interest-bearing Demand Deposits				1,557,341				1,504,447			4	%			1,440,326			8	%
Total Deposits				6,915,708				6,505,351			6	%			6,091,674			14	%
Stockholders’ Equity				715,203				681,510			5	%			607,604			18	%
* Non-routine expenses during the comparative periods presented in this press release as more fully described in “GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures” below.

DETAILED FINANCIALS

ServisFirst Bancshares, Inc. reported net income and net income available to common stockholders of $36.2 million for the quarter ended December 31, 2018, compared to net income of $21.2 million and net income available to common stockholders of $21.1 million for the same quarter in 2017.  Basic and diluted earnings per common share were $0.68 and $0.67, respectively, for the fourth quarter of 2018, compared to $0.40 and $0.39, respectively, for the fourth quarter of 2017.

Return on average assets was 1.85% and return on average common stockholders’ equity was 21.13 for the fourth quarter of 2018, compared to 1.20% and 13.97%, respectively, for the fourth quarter of 2017.

Net interest income was $68.9 million for the fourth quarter of 2018, compared to $66.9 million for the third quarter of 2018 and $61.4 million for the fourth quarter of 2017.  The net interest margin in the fourth quarter of 2018 was 3.63% compared to 3.77% in the third quarter of 2018 and 3.66% in the fourth quarter of 2017.  Loans of $16.7 million were added to nonaccrual status during the fourth quarter of 2018 resulting in the reversal of $390,000 in interest income.  Linked quarter increases in average rates paid on deposits in excess of increased average yields on loans drove unfavorable mix change, while increases in average balances in loans, non-interest bearing deposits and equity drove favorable volume change and overall change.

Average loans for the fourth quarter of 2018 were $6.43 billion, an increase of $199.4 million, or 3%, over average loans of $6.23 billion for the third quarter of 2018, and an increase of $715.6 million, or 13%, over average loans of $5.72 billion for the fourth quarter of 2017.

Average total deposits for the fourth quarter of 2018 were $6.74 billion, an increase of $403.5 million, or 6%, over average total deposits of $6.33 billion for the third quarter of 2018, and an increase of $702.4 million, or 12%, over average total deposits of $6.03 billion for the fourth quarter of 2017.

Non-performing assets to total assets were 0.41% for the fourth quarter of 2018, an increase of 14 basis points compared to 0.27% for the third quarter of 2018 and an increase of 16 basis points compared to 0.25% for the fourth quarter of 2017.  $10.4 million of the previously mentioned $16.7 million of loans added to nonaccrual status were classified as accruing TDRs at September 30, 2018.  Net credit charge-offs to average loans were 0.30%, a five basis point increase compared to 0.25% for the third quarter of 2018 and a decrease of 26 basis points compared to 0.56% for the fourth quarter of 2017.  Year-to-date net credit charge-offs to average loans were 0.20%, a nine basis point decrease compared to 0.29% for the same period in 2017.  We recorded a $6.5 million provision for loan losses in the fourth quarter of 2018 compared to $6.6 million in the third quarter of 2018 and $9.1 million in the fourth quarter of 2017.  The allowance for loan loss as a percentage of total loans was 1.05% at December 31, 2018 compared to 1.05% at September 30, 2018 and 1.02% at December 31, 2017.  In management’s opinion, the allowance is adequate and was determined by consistent application of ServisFirst Bank’s methodology for calculating its allowance for loan losses.

Non-interest income increased $712,000 during the fourth quarter of 2018, or 15%, compared to the fourth quarter of 2017.  Deposit service charges increased $215,000 in the fourth quarter of 2018, or 14%, compared to the fourth quarter of 2017.  The number of transaction deposit accounts increased approximately 8% from December 31, 2017 to December 31, 2018, and the amount of overdraft fees increased $175,000, or 24%, from the fourth quarter of 2017 to the fourth quarter of 2018.  Mortgage banking revenue decreased $206,000, or 23%, from the fourth quarter of 2017 to the fourth quarter of 2018.  Increases in market rates have slowed originations and refinancing activity during 2018.  Credit card revenue increased $695,000, or 54%, to $2.0 million during the fourth quarter of 2018, compared to $1.3 million during the fourth quarter of 2017, driven by increased numbers of accounts and increased purchases per account.

Non-interest expense for the fourth quarter of 2018 increased $2.0 million, or 9%, to $23.3 million from $21.3 million in the fourth quarter of 2017, and increased $149,000, or 1%, on a linked quarter basis.  Salary and benefit expense for the fourth quarter of 2018 increased $953,000, or 8%, to $12.4 million from $11.4 million in the fourth quarter of 2017, and decreased $685,000, or 5%, on a linked quarter basis.  The linked-quarter decrease resulted from a $815,000 reversal of incentive bonuses in December 2018 that were accrued during the first eleven months of 2018.  The number of FTE employees increased from 428 at December 31, 2017 to 468 at December 31, 2018, or 9%.  Equipment and occupancy expense increased $597,000, or 38%, to $2.2 million in the fourth quarter of 2018, from $1.6 million in the fourth quarter of 2017, and decreased $30,000 on a linked-quarter basis.  Other operating expense for the fourth quarter of 2018 increased $526,000, or 8%, to $6.8 million from $6.2 million in the fourth quarter of 2017, and increased $690,000, or 11%, on a linked-quarter basis.  During the fourth quarter of 2018 we recognized a $250,000 charge related to a wire fraud.  The efficiency ratio improved to 31.28% during the fourth quarter of 2018 from 32.05% during the fourth quarter of 2017 and from 31.95% on a linked quarter basis.

Income tax expense decreased $6.4 million, or 43%, to $8.4 million in the fourth quarter of 2018, compared to $14.9 million in the fourth quarter of 2017.  We recognized $3.1 million of additional tax expense during the fourth quarter of 2017 as a result of revaluing our net deferred tax assets as of December 31, 2017 in connection with the Tax Cuts and Jobs Act passed into law in December 2017.  Lower corporate income tax rates resulting from the passage of this law have resulted in lower effective tax rates starting in 2018.  We also recognized a reduction in provision for income taxes resulting from excess tax benefits from the exercise and vesting of stock options and restricted stock during the fourth quarters of 2018 and 2017 of $1.5 million and $351,000, respectively.

GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures

We recorded $3.1 million of additional tax expense as a result of revaluing our net deferred tax assets at December 31, 2017 due to lower corporate income tax rates provided by the Tax Cuts and Jobs Act passed into law in December 2017. During the fourth quarter of 2017 we also recorded expenses of $347,000 related to terminating the lease agreement on our previous headquarters building in Birmingham, Alabama and expenses of moving into our new headquarters building.  Financial measures included in this press release that are presented adjusted for these non-routine expenses are net income, net income available to common stockholders, diluted earnings per share, return on average assets and return on average common stockholders’ equity.  Each of these five financial measures excludes the impact of the non-routine expenses attributable to our net deferred tax asset revaluation, lease termination and moving expenses, and are all considered non-GAAP financial measures.  In addition to these financial measures adjusted for non-routine expenses, this press release contains certain non-GAAP financial measures, including tangible common stockholders’ equity, total tangible assets, tangible book value per share and tangible common equity to total tangible assets, each of which excludes goodwill and core deposit intangibles associated with our acquisition of Metro Bancshares, Inc. in January 2015.  We believe these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that these non-GAAP financial measures have a number of limitations.  As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies, including those in our industry, use.  The following reconciliation table provides a more detailed analysis of the non-GAAP financial measures as of and for the comparative periods presented in this press release.  Dollars are in thousands, except share and per share data.

															Three Months ended December 31, 2017				Year ended December 31, 2017
Return on average assets – GAAP																1.20	%			1.43	%
Net income – GAAP															$	21,150			$	93,092
	Adjustments:
	Revaluation of net deferred tax assets															3,059				3,059
	Lease termination and moving expenses															347				347
	Tax (benefit) of adjustments															(132	)			(132	)
Net income adjusted for non-routine expenses, net of tax
	benefit – non-GAAP														$	24,424			$	96,366
Average assets															$	6,988,731			$	6,495,067
Return on average assets adjusted for non-routine
	expenses – non-GAAP															1.39	%			1.48	%
Return on average common stockholders’ equity – GAAP																13.97	%			16.37	%
Net income available to common stockholders – GAAP															$	21,119			$	93,030
	Adjustments:
	Revaluation of net deferred tax assets															3,059				3,059
	Lease termination and moving expenses															347				347
	Tax (benefit) of adjustments															(132	)			(132	)
Net income available to common stockholders – adjusted for
	non-routine expenses – non-GAAP														$	24,393			$	96,304
Average common stockholders’ equity															$	599,947			$	568,228
Return on average common stockholders’ equity – adjusted
	for non-routine expenses – non-GAAP															16.13	%			16.95	%
Diluted earnings per share															$	0.39			$	1.72
Weighted average shares outstanding, diluted – GAAP																54,161,788				54,123,957
Diluted earnings per share – adjusted for non-routine
	expenses – non-GAAP														$	0.45			$	1.78
			At December 31, 2018				At September 30, 2018				At June 30, 2018				At March 31, 2018				At December 31, 2017
Book value per share – GAAP			$	13.40			$	12.81			$	12.33			$	11.84			$	11.47
Total common stockholders’ equity – GAAP				715,203				681,510				655,114				629,297				607,604
	Adjustments:
	Adjusted for goodwill and core deposit intangible asset			14,449				14,517				14,584				14,652				14,719
Tangible common stockholders’ equity – non-GAAP			$	700,754			$	666,993			$	640,530			$	614,645			$	592,885
Tangible book value per share – non-GAAP			$	13.13			$	12.54			$	12.05			$	11.56			$	11.19
Stockholders’ equity to total assets – GAAP				8.93	%			9.07	%			9.25	%			8.98	%			8.58	%
Total assets – GAAP			$	8,007,382			$	7,517,833			$	7,084,562			$	7,011,735			$	7,082,384
	Adjustments:
	Adjusted for goodwill and core deposit intangible asset			14,449				14,517				14,584				14,652				14,719
Total tangible assets – non-GAAP			$	7,992,933			$	7,503,316			$	7,069,978			$	6,997,083			$	7,067,665
Tangible common equity to total tangible assets – non-GAAP				8.77	%			8.89	%			9.06	%			8.78	%			8.39	%

About ServisFirst Bancshares, Inc.

ServisFirst Bancshares, Inc. is a bank holding company based in Birmingham, Alabama. Through its subsidiary ServisFirst Bank, ServisFirst Bancshares, Inc. provides business and personal financial services from locations in Birmingham, Huntsville, Montgomery, Mobile and Dothan, Alabama, Pensacola and Tampa Bay, Florida, Atlanta, Georgia, Charleston, South Carolina and Nashville, Tennessee.

ServisFirst Bancshares, Inc. files periodic reports with the U.S. Securities and Exchange Commission (SEC).  Copies of its filings may be obtained through the SEC’s website at www.sec.gov or at www.servisfirstbancshares.com.

Statements in this press release that are not historical facts, including, but not limited to, statements concerning future operations, results or performance, are hereby identified as “forward-looking statements” for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933.  The words “believe,” “expect,” “anticipate,” “project,” “plan,” “intend,” “will,” “would,” “might” and similar expressions often signify forward-looking statements. Such statements involve inherent risks and uncertainties. ServisFirst Bancshares, Inc. cautions that such forward-looking statements, wherever they occur in this press release or in other statements attributable to ServisFirst Bancshares, Inc., are necessarily estimates reflecting the judgment of ServisFirst Bancshares, Inc.’s senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements.  Such forward-looking statements should, therefore, be considered in light of various factors that could affect the accuracy of such forward-looking statements, including: general economic conditions, especially in the credit markets and in the Southeast; the performance of the capital markets; changes in interest rates, yield curves and interest rate spread relationships; changes in accounting and tax principles, policies or guidelines; changes in legislation or regulatory requirements; changes in our loan portfolio and the deposit base; possible changes in laws and regulations and governmental monetary and fiscal policies, including, but not limited to, economic stimulus initiatives; the cost and other effects of legal and administrative cases and similar contingencies; possible changes in the creditworthiness of customers and the possible impairment of the collectability of loans and the value of collateral; the effect of natural disasters, such as hurricanes and tornados, in our geographic markets; and increased competition from both banks and non-bank financial institutions.  The foregoing list of factors is not exhaustive. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Cautionary Note Regarding Forward-looking Statements” and “Risk Factors” in our most recent Annual Report on Form 10-K and our other SEC filings. If one or more of the factors affecting our forward-looking information and statements proves incorrect, then our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements contained herein. Accordingly, you should not place undue reliance on any forward-looking statements, which speak only as of the date made.  ServisFirst Bancshares, Inc. assumes no obligation to update or revise any forward-looking statements that are made from time to time.

More information about ServisFirst Bancshares, Inc. may be obtained over the Internet at www.servisfirstbancshares.com  or by calling (205) 949-0302.

Contact: ServisFirst Bank
Davis Mange (205) 949-3420
[email protected]

SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(In thousands except share and per share data)
		4th Quarter 2018				3rd Quarter 2018				2nd Quarter 2018				1st Quarter 2018				4th Quarter 2017
CONSOLIDATED STATEMENT OF INCOME
Interest income		$	90,164			$	84,058			$	78,396			$	74,009			$	72,060
Interest expense			21,306				17,195				13,874				11,573				10,652
Net interest income			68,858				66,863				64,522				62,436				61,408
Provision for loan losses			6,518				6,624				4,121				4,139				9,055
Net interest income after provision for loan losses			62,340				60,239				60,401				58,297				52,353
Non-interest income			5,617				5,591				5,459				4,869				4,905
Non-interest expense			23,299				23,150				24,010				23,512				21,255
Income before income tax			44,658				42,680				41,850				39,654				36,003
Provision for income tax			8,421				8,120				8,310				7,051				14,853
Net income			36,237				34,560				33,540				32,603				21,150
Preferred stock dividends			32				–				31				–				31
Net income available to common stockholders		$	36,205			$	34,560			$	33,509			$	32,603			$	21,119
Earnings per share – basic		$	0.68			$	0.65			$	0.63			$	0.61			$	0.40
Earnings per share – diluted		$	0.67			$	0.64			$	0.62			$	0.60			$	0.39
Average diluted shares outstanding			54,109,450				54,191,222				54,196,023				54,183,400				54,161,788
CONSOLIDATED BALANCE SHEET DATA
Total assets		$	8,007,382			$	7,517,833			$	7,084,562			$	7,011,735			$	7,082,384
Loans			6,533,499				6,363,531				6,129,649				5,928,327				5,851,261
Debt securities			590,184				578,271				583,799				560,885				538,330
Non-interest-bearing demand deposits			1,557,341				1,504,447				1,481,447				1,407,592				1,440,326
Total deposits			6,915,708				6,505,351				6,085,682				5,977,387				6,091,674
Borrowings			64,666				64,657				64,648				64,739				64,832
Stockholders’ equity		$	715,203			$	681,510			$	655,114			$	629,297			$	607,604
Shares outstanding			53,375,195				53,197,807				53,150,733				53,147,169				52,992,586
Book value per share		$	13.40			$	12.81			$	12.33			$	11.84			$	11.47
Tangible book value per share (1)		$	13.13			$	12.54			$	12.05			$	11.56			$	11.19
SELECTED FINANCIAL RATIOS
Net interest margin			3.63	%			3.77	%			3.82	%			3.81	%			3.66	%
Return on average assets			1.85	%			1.87	%			1.91	%			1.91	%			1.20	%
Return on average common stockholders’ equity			21.13	%			20.42	%			20.89	%			21.40	%			13.97	%
Efficiency ratio			31.28	%			31.95	%			34.31	%			34.93	%			32.05	%
Non-interest expense to average earning assets			1.23	%			1.30	%			1.42	%			1.43	%			1.26	%
CAPITAL RATIOS (2)
Common equity tier 1 capital to risk-weighted assets			10.12	%			10.08	%			10.08	%			9.88	%			9.51	%
Tier 1 capital to risk-weighted assets			10.13	%			10.09	%			10.08	%			9.88	%			9.52	%
Total capital to risk-weighted assets			12.05	%			12.05	%			12.10	%			11.91	%			11.52	%
Tier 1 capital to average assets			9.07	%			9.28	%			9.21	%			8.95	%			8.51	%
Tangible common equity to total tangible assets (1)			8.77	%			8.89	%			9.06	%			8.78	%			8.39	%
(1) See “GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures” for a discussion of these Non-GAAP financial measures.
(2) Regulatory capital ratios for most recent period are preliminary.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands)
			December 31, 2018				December 31, 2017
											% Change
ASSETS
Cash and due from banks			$	206,434			$	86,213			139		%
Interest-bearing balances due from depository institutions				251,616				151,849			66		%
Federal funds sold				223,845				239,524			(7	)	%
	Cash and cash equivalents			681,895				477,586			43		%
Available for sale debt securities, at fair value				590,184				538,080			10		%
Held to maturity debt securities (fair value of $250 at December 31, 2017)				–				250			NM
Restricted equity securities				894				1,034			(14	)	%
Mortgage loans held for sale				120				4,459			(97	)	%
Loans				6,533,499				5,851,261			12		%
Less allowance for loan losses				(68,600	)			(59,406	)		15		%
	Loans, net			6,464,899				5,791,855			12		%
Premises and equipment, net				57,822				58,900			(2	)	%
Goodwill and other identifiable intangible assets				14,449				14,719			(2	)	%
Other assets				197,119				195,501			1		%
	Total assets		$	8,007,382			$	7,082,384			13		%
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Deposits:
	Non-interest-bearing		$	1,557,341			$	1,440,326			8		%
	Interest-bearing			5,358,367				4,651,348			15		%
		Total deposits		6,915,708				6,091,674			14		%
Federal funds purchased				288,725				301,797			(4	)	%
Other borrowings				64,666				64,832			–		%
Other liabilities				23,080				16,477			40		%
	Total liabilities			7,292,179				6,474,780			13		%
Stockholders’ equity:
	Preferred stock, par value $0.001 per share; 1,000,000 authorized and undesignated at
		December 31, 2018 and December 31, 2017		–				–			–		%
	Common stock, par value $0.001 per share; 100,000,000 shares authorized; 53,375,195 shares
		issued and outstanding at December 31, 2018, and 52,992,586 shares issued and outstanding
		at December 31, 2017		53				53			–		%
	Additional paid-in capital			218,521				217,693			–		%
	Retained earnings			500,868				389,554			29		%
	Accumulated other comprehensive loss			(4,741	)			(198	)		N/M
		Total stockholders’ equity attributable to ServisFirst Bancshares, Inc.		714,701				607,102			18		%
	Noncontrolling interest			502				502			–		%
		Total stockholders’ equity		715,203				607,604			18		%
	Total liabilities and stockholders’ equity		$	8,007,382			$	7,082,384			13		%

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands except per share data)
			Three Months Ended December 31,						Year Ended December 31,
			2018			2017			2018			2017
Interest income:
	Interest and fees on loans		$	83,085		$	67,357		$	305,370		$	246,682
	Taxable securities			3,506			2,468			12,654			9,117
	Nontaxable securities			544			702			2,406			2,948
	Federal funds sold			966			508			3,103			1,693
	Other interest and dividends			2,063			1,025			3,094			2,316
	Total interest income			90,164			72,060			326,627			262,756
Interest expense:
	Deposits			18,957			8,954			55,502			28,831
	Borrowed funds			2,349			1,698			8,446			6,502
	Total interest expense			21,306			10,652			63,948			35,333
	Net interest income			68,858			61,408			262,679			227,423
Provision for loan losses				6,518			9,055			21,402			23,225
	Net interest income after provision for loan losses			62,340			52,353			241,277			204,198
Non-interest income:
	Service charges on deposit accounts			1,714			1,499			6,547			5,702
	Mortgage banking			688			894			2,784			3,835
	Credit card income			1,993			1,298			7,165			4,815
	Securities gains			–			–			190			–
	Increase in cash surrender value life insurance			780			797			3,130			3,131
	Other operating income			442			417			1,720			1,563
	Total non-interest income			5,617			4,905			21,536			19,046
Non-interest expense:
	Salaries and employee benefits			12,385			11,432			51,849			47,604
	Equipment and occupancy expense			2,163			1,566			8,423			8,018
	Professional services			1,064			833			3,646			3,217
	FDIC and other regulatory assessments			902			1,030			3,869			3,918
	Other real estate owned expense			25			160			790			323
	Other operating expense			6,760			6,234			25,394			22,814
	Total non-interest expense			23,299			21,255			93,971			85,894
	Income before income tax			44,658			36,003			168,842			137,350
Provision for income tax				8,421			14,853			31,902			44,258
	Net income			36,237			21,150			136,940			93,092
	Dividends on preferred stock			32			31			63			62
	Net income available to common stockholders		$	36,205		$	21,119		$	136,877		$	93,030
Basic earnings per common share			$	0.68		$	0.40		$	2.57		$	1.76
Diluted earnings per common share			$	0.67		$	0.39		$	2.53		$	1.72

LOANS BY TYPE (UNAUDITED)
(In thousands)
			4th Quarter 2018			3rd Quarter 2018			2nd Quarter 2018			1st Quarter 2018			4th Quarter 2017
Commercial, financial and agricultural			$	2,513,225		$	2,478,788		$	2,345,879		$	2,329,904		$	2,279,366
Real estate – construction				533,192			543,611			522,788			506,050			580,874
Real estate – mortgage:
	Owner-occupied commercial			1,463,887			1,430,111			1,383,882			1,349,679			1,328,666
	1-4 family mortgage			621,634			610,460			584,133			581,498			603,063
	Other mortgage			1,337,068			1,236,954			1,225,906			1,099,482			997,079
Subtotal: Real estate – mortgage				3,422,589			3,277,525			3,193,921			3,030,659			2,928,808
Consumer				64,493			63,607			67,061			61,714			62,213
Total loans			$	6,533,499		$	6,363,531		$	6,129,649		$	5,928,327		$	5,851,261

SUMMARY OF LOAN LOSS EXPERIENCE (UNAUDITED)
(Dollars in thousands)
			4th Quarter 2018					3rd Quarter 2018					2nd Quarter 2018					1st Quarter 2018					4th Quarter 2017
Allowance for loan losses:
Beginning balance			$	66,879				$	64,239				$	62,050				$	59,406				$	58,459
Loans charged off:
	Commercial, financial and agricultural			4,685					3,923					1,732					1,088					7,064
	Real estate – construction			–					–					–					–					–
	Real estate – mortgage			173					48					440					381					1,134
	Consumer			72					76					47					88					137
		Total charge offs		4,930					4,047					2,219					1,557					8,335
Recoveries:
	Commercial, financial and agricultural			120					52					173					4					64
	Real estate – construction			4					4					97					7					126
	Real estate – mortgage			1					1					2					42					26
	Consumer			8					6					15					9					11
		Total recoveries		133					63					287					62					227
	Net charge-offs			4,797					3,984					1,932					1,495					8,108
	Provision for loan losses			6,518					6,624					4,121					4,139					9,055
	Ending balance		$	68,600				$	66,879				$	64,239				$	62,050				$	59,406
	Allowance for loan losses to total loans			1.05		%			1.05		%			1.05		%			1.05		%			1.02		%
	Allowance for loan losses to total average
		loans		1.07		%			1.07		%			1.07		%			1.05		%			1.04		%
	Net charge-offs to total average loans			0.30		%			0.25		%			0.13		%			0.10		%			0.56		%
	Provision for loan losses to total average
		loans		0.40		%			0.42		%			0.28		%			0.29		%			0.63		%
	Nonperforming assets:
		Nonaccrual loans	$	21,926				$	9,153				$	8,022				$	9,271				$	10,765
		Loans 90+ days past due and accruing		5,844					5,714					6,081					678					60
		Other real estate owned and
		repossessed assets		5,169					5,714					5,937					5,748					6,701
	Total		$	32,939				$	20,581				$	20,040				$	15,697				$	17,526
	Nonperforming loans to total loans			0.43		%			0.23		%			0.23		%			0.17		%			0.19		%
	Nonperforming assets to total assets			0.41		%			0.27		%			0.28		%			0.22		%			0.25		%
	Nonperforming assets to earning assets			0.43		%			0.28		%			0.29		%			0.23		%			0.25		%
	Reserve for loan losses to nonaccrual loans			312.87		%			730.68		%			800.79		%			669.29		%			551.84		%
	Restructured accruing loans		$	3,073				$	15,495				$	15,572				$	15,838				$	16,919
	Restructured accruing loans to total loans			0.04		%			0.24		%			0.25		%			0.27		%			0.29		%
	TROUBLED DEBT RESTRUCTURINGS (TDRs) (UNAUDITED)
	(In thousands)
			4th Quarter 2018					3rd Quarter 2018					2nd Quarter 2018					1st Quarter 2018					4th Quarter 2017
	Beginning balance:		$	16,584				$	17,257				$	18,792				$	20,572				$	16,354
		Additions		–					100					–					–					4,233
		Net (paydowns) / advances		(11	)				(177	)				(267	)				(1,080	)				(15	)
		Charge-offs		(2,018	)				(596	)				(1,268	)				(700	)				–
			$	14,555				$	16,584				$	17,257				$	18,792				$	20,572

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands except per share data)
				4th Quarter 2018			3rd Quarter 2018			2nd Quarter 2018			1st Quarter 2018			4th Quarter 2017
Interest income:
	Interest and fees on loans			$	83,085		$	78,991		$	73,620		$	69,674		$	67,357
	Taxable securities				3,506			3,276			3,127			2,745			2,468
	Nontaxable securities				544			583			623			656			702
	Federal funds sold				966			892			694			551			508
	Other interest and dividends				2,063			316			332			383			1,025
	Total interest income				90,164			84,058			78,396			74,009			72,060
Interest expense:
	Deposits				18,957			15,210			11,714			9,621			8,954
	Borrowed funds				2,349			1,985			2,160			1,952			1,698
	Total interest expense				21,306			17,195			13,874			11,573			10,652
	Net interest income				68,858			66,863			64,522			62,436			61,408
Provision for loan losses					6,518			6,624			4,121			4,139			9,055
	Net interest income after provision for loan losses				62,340			60,239			60,401			58,297			52,353
Non-interest income:
	Service charges on deposit accounts				1,714			1,595			1,653			1,585			1,499
	Mortgage banking				688			789			789			518			894
	Credit card income				1,993			1,838			1,756			1,578			1,298
	Securities gains				–			186			–			4			–
	Increase in cash surrender value life insurance				780			787			786			777			797
	Other operating income				442			396			475			407			417
	Total non-interest income				5,617			5,591			5,459			4,869			4,905
Non-interest expense:
	Salaries and employee benefits				12,385			13,070			13,098			13,296			11,432
	Equipment and occupancy expense				2,163			2,193			2,113			1,954			1,566
	Professional services				1,064			853			924			805			833
	FDIC and other regulatory assessments				902			675			1,159			1,133			1,030
	Other real estate owned expense				25			289			160			316			160
	Other operating expense				6,760			6,070			6,556			6,008			6,234
	Total non-interest expense				23,299			23,150			24,010			23,512			21,255
	Income before income tax				44,658			42,680			41,850			39,654			36,003
Provision for income tax					8,421			8,120			8,310			7,051			14,853
	Net income				36,237			34,560			33,540			32,603			21,150
	Dividends on preferred stock				32			–			31			–			31
	Net income available to common stockholders			$	36,205		$	34,560		$	33,509		$	32,603		$	21,119
Basic earnings per common share				$	0.68		$	0.65		$	0.63		$	0.61		$	0.40
Diluted earnings per common share				$	0.67		$	0.64		$	0.62		$	0.60		$	0.39

AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS (UNAUDITED)
ON A FULLY TAXABLE-EQUIVALENT BASIS
(Dollars in thousands)
							4th Quarter 2018							3rd Quarter 2018							2nd Quarter 2018							1st Quarter 2018							4th Quarter 2017
							Average Balance				Yield / Rate			Average Balance				Yield / Rate			Average Balance				Yield / Rate			Average Balance				Yield / Rate			Average Balance			Yield / Rate
Assets:
Interest-earning assets:
		Loans, net of unearned income (1)
			Taxable				$	6,403,139			5.13	%		$	6,203,372			5.03	%		$	5,958,377			4.94	%		$	5,847,443			4.81	%		$	5,680,227		4.68	%
			Tax-exempt (2)					29,656			3.26				30,005			3.94				30,246			3.94				36,357			4.06				36,992		4.95
				Total loans, net of
					unearned income			6,432,795			5.12				6,233,377			5.03				5,988,623			4.93				5,883,800			4.80				5,717,219		4.68
		Mortgage loans held for sale						3,364			3.30				3,538			4.15				3,770			4.26				3,698			4.50				6,199		3.52
		Debt securities:
			Taxable					498,138			2.82				482,571			2.72				475,777			2.63				435,747			2.52				406,488		2.43
			Tax-exempt (2)					98,027			2.34				105,592			2.45				112,145			2.60				120,270			2.56				128,201		3.27
				Total securities (3)				596,165			2.74				588,163			2.67				587,922			2.62				556,017			2.53				534,689		2.63
		Federal funds sold						156,884			2.44				163,453			2.17				141,915			1.96				131,472			1.70				143,905		1.40
		Restricted equity securities						879			1.35				993			2.80				1,022			1.18				1,030			1.57				1,030		1.93
		Interest-bearing balances with banks						334,065			2.45				61,867			1.98				73,714			1.79				96,012			1.60				310,289		1.31
		Total interest-earning assets					$	7,524,152			4.76	%		$	7,051,391			4.74	%		$	6,796,966			4.64	%		$	6,672,029			4.51	%		$	6,713,331		4.29	%
Non-interest-earning assets:
		Cash and due from banks						74,272							76,800							68,190							68,309							68,444
		Net premises and equipment						58,521							58,873							59,262							59,709							57,320
		Allowance for loan losses, accrued
			interest and other assets					128,054							127,850							129,585							140,558							149,636
				Total assets			$	7,784,999						$	7,314,914						$	7,054,003						$	6,940,605						$	6,988,731
Interest-bearing liabilities:
		Interest-bearing deposits:
		Checking					$	908,416			0.74	%		$	819,807			0.67	%		$	827,540			0.56	%		$	899,311			0.52	%		$	899,334		0.46	%
		Savings						52,443			0.54				53,835			0.52				54,842			0.34				53,269			0.31				49,697		0.31
		Money market						3,537,522			1.56				3,305,293			1.33				3,089,595			1.10				3,027,176			0.90				3,065,298		0.80
		Time deposits						687,361			1.92				643,260			1.65				596,450			1.36				576,857			1.21				576,010		1.16
			Total interest-bearing deposits					5,185,742			1.45				4,822,195			1.25				4,568,427			1.03				4,556,613			0.86				4,590,339		0.77
		Federal funds purchased						263,125			2.36				229,016			2.09				295,309			1.87				297,051			1.60				271,248		1.37
		Other borrowings						64,665			4.79				64,652			4.79				64,699			4.85				64,805			4.89				60,829		4.98
		Total interest-bearing liabilities					$	5,513,532			1.53	%		$	5,115,863			1.33	%		$	4,928,435			1.13	%		$	4,918,469			0.95	%		$	4,922,416		0.86	%
Non-interest-bearing liabilities:
		Non-interest-bearing
			demand					1,551,366							1,511,410							1,469,194							1,389,217							1,444,338
		Other liabilities						40,185							16,333							13,079							15,007							22,029
		Stockholders’ equity						689,525							678,839							650,641							621,004							599,754
		Accumulated other comprehensive
			(loss) income					(9,609	)						(7,531	)						(7,346	)						(3,092	)						194
				Total liabilities and
					stockholders’ equity		$	7,784,999						$	7,314,914						$	7,054,003						$	6,940,605						$	6,988,731
Net interest spread											3.23	%						3.41	%						3.51	%						3.56	%					3.43	%
Net interest margin											3.63	%						3.77	%						3.82	%						3.81	%					3.66	%
(1	)	Average loans include loans on which the accrual of interest has been discontinued.
(2	)	Interest income and yields are presented on a fully taxable equivalent basis using a tax rate of 21% for the quarters in 2018 and 35% for the quarter in 2017.
(3	)	Unrealized (losses) gains on available-for-sale debt securities are excluded from the yield calculation.