Bank First(BFC)2025-02-28 21:05Interest Rate Risk Management - The Company actively manages interest rate risk through various tools, including interest rate sensitivity analysis and net interest margin reports [321]. - The Company’s asset-liability structure is configured to maximize yield-cost spread while minimizing adverse impacts from interest rate changes [317]. - The Company’s interest rate risk management aims to achieve sustainable growth in net interest income [320]. - The Company’s financial condition is sensitive to changes in interest rates, with various economic scenarios modeled to assess risk [322]. - The Company reported a projected net interest income decrease of 4.5% with a 300 basis point increase in interest rates [326]. - An instantaneous 200 basis point increase in interest rates is estimated to increase the economic value of equity by 3.00% [326]. - The Company’s profitability is significantly impacted by changes in interest rates, with a potential decrease of 1.5% in net interest income for a 100 basis point increase [326]. Financial Performance - The company reported a net income of 74.5 million in 2023, which is a decrease of approximately 11.7% [347]. - Earnings per share (EPS) for 2024 was 7.28 in 2023, reflecting a decline of about 10.7% [347]. - Net interest income for 2024 was 133.5 million in 2023, indicating a year-over-year increase of about 3.0% [346]. - Noninterest income for 2024 was 58.1 million in 2023, indicating a decrease of about 66.1% [346]. - The total income for the year ended December 31, 2024, was 78,844,000 in 2023, representing a decline of about 13.9% [508]. Asset and Liability Management - Total assets increased to 4.222 billion in 2023, representing a growth of approximately 6.5% [344]. - Total deposits increased to 3.433 billion in 2023, marking an increase of approximately 6.6% [344]. - The total stockholders' equity increased to 619.8 million in 2023, representing a growth of approximately 3.2% [344]. - The total liabilities of the parent company decreased from 15,709,000 in 2024, showing a reduction of approximately 11.7% [505]. Credit Losses and Allowances - The company’s allowance for credit losses on loans (ACL-Loans) was 43.6 million in 2023 [339]. - The provision for credit losses was a reversal of 4.7 million in 2023, showing a significant change in credit loss expectations [346]. - The allowance for credit losses (ACL) for loans is estimated based on the amortized cost basis of the underlying loan, with significant factors including changes in the loan portfolio and expected future economic conditions [385]. - The provision for credit losses for loans was 4,292 thousand in 2023, indicating improved credit quality [436]. - The company has established an ACL for unfunded commitments of 3.8 million in 2023, indicating a reduction in potential credit exposure [434]. Mergers and Acquisitions - The merger with Hometown Bancorp, Ltd. was completed on February 10, 2023, with a total merger consideration of approximately 115,079,000 and cash of 615,105,000, with an excess of assets over liabilities of 64,881,000, primarily due to synergies and cost savings from combining operations [422]. Securities and Investments - As of December 31, 2024, total available for sale securities were valued at 12,855,000 [423]. - The estimated fair value of held to maturity securities was 247,468,000 in 2023 to 1.55 per share in 2024, up from 15,562,000 in dividends paid [357]. - The Company could declare dividends totaling approximately $101.1 million without prior approval as of December 31, 2024 [480]. - The Company’s employee stock ownership plan held 221,214 shares as of December 31, 2024, down from 272,132 shares in 2023 [475].