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FOR IMMEDIATE RELEASE
QCR Holdings, Inc. Announces Record Net Income for the Fourth Quarter and Full Year 2018
Fourth Quarter 2018 Highlights
· Net income of $13.3 million, or $0.84 per diluted share
· Adjusted net income (non-GAAP) of $14.5 million, or $0.91 per diluted share
· Annualized organic loan and lease growth of 8.7% for the quarter and 9.8% for the year
· Annualized organic deposit growth of 19.8% for the quarter and 8.3% for the year
· Record noninterest income of $15.3 million for the quarter and $41.5 million for the year
· Nonperforming assets down $13.6 million, or 32.8% from prior quarter
· Acquisition of the Bates Companies completed on October 1, 2018
Moline, IL, January 24, 2019 QCR Holdings, Inc. (NASDAQ: QCRH) (the Company) today announced net income of $13.3 million and diluted earnings per share (EPS) of $0.84 for the fourth quarter of 2018, compared to net income of $8.8 million and diluted EPS of $0.55 for the third quarter of 2018. The fourth quarter results included $1.2 million of acquisition and post-acquisition compensation, transition and integration costs (after-tax), compared to $1.6 million of similar costs in the third quarter of 2018. Excluding these adjustments, the Company reported adjusted net income (non-GAAP) of $14.5 million and adjusted diluted EPS of $0.91 for the fourth quarter of 2018, compared to adjusted net income (non-GAAP) of $10.4 million and adjusted diluted EPS of $0.65 for the third quarter of 2018. For the fourth quarter of 2017, GAAP net income and adjusted net income (non-GAAP) were the same at $9.9 million and $0.70 per diluted share.
For the year ended December 31, 2018, the Company reported net income of $43.1 million, and diluted EPS of $2.86. Adjusting for acquisition and post-acquisition compensation, transition and integration costs, the Company reported adjusted net income (non-GAAP) of $46.4 million and adjusted diluted EPS of $3.08. By comparison, for the year ended December 31, 2017, the Company reported net income of $35.7 million and diluted EPS of $2.61, and adjusted net income (non-GAAP) of $36.3 million and adjusted diluted EPS of $2.66.
On October 1, 2018, the Company completed its previously announced acquisition of Bates Financial Advisors, Inc., Bates Financial Services, Inc., Bates Securities, Inc., and Bates Financial Group, Inc. (the Bates Companies). The Bates Companies are headquartered in Rockford, Illinois and added approximately $700 million in assets under management, as of September 30, 2018.
We are pleased with our financial performance in 2018, delivering record net income, which translated into a 16% increase in adjusted earnings per share, said Doug Hultquist, President and CEO of the Company. Our strong financial results were driven by increases in both loans and deposits and significantly higher noninterest income. And while our net interest margin was adversely impacted by the flattening of the yield curve over the course of 2018, we were able to grow adjusted net interest income by 19% from 2017. We also were pleased to have completed our merger with Springfield Bancshares, an excellent strategic and cultural fit for our company, and the acquisition of the Bates Companies, a nice addition to our wealth management business.
Mr. Hultquist continued, We finished the year with strong momentum in the fourth quarter, delivering solid loan and lease production, successfully attracting new deposits and generating record fee income. We were also successful in reducing our nonperforming assets by 33%, as we monetized a number of positions during the quarter. Looking to 2019, we remain optimistic, as we continue to make the investments that we believe will lead to improved profitability and enhanced shareholder value in the years to come.
Annualized Organic Loan and Lease Growth of 8.7% for the Quarter and 9.8% for the Year
During the fourth quarter of 2018, the Companys total assets increased $157.0 million, to a total of $4.9 billion, while total loans and leases grew $79.4 million, or a 2.2% increase, compared to the third quarter of 2018. Loan and lease growth was funded by an increase in core deposits. Core deposits (excluding brokered deposits) increased $187.0 million, or 5.3% on a linked quarter basis. At quarter-end, the percentage of wholesale funds to total assets was 13.8%, which is a solid decline from 15.9% from the third quarter. Additionally, at quarter-end, the percentage of gross loans and leases to total assets was 75%, a slight decline from the third quarter, as a result of an increase in liquidity due to the strong growth in core deposits.
Our loan growth for the quarter was driven by strong loan production, with particular strength in commercial and industrial and owner occupied commercial real estate loans, added Mr. Hultquist. However, we continue to experience an elevated level of payoffs, driven by
The following information was filed by Qcr Holdings Inc (QCRH) on Thursday, January 24, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.