eqbk-8k_20190123.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): January 23, 2019

 

EQUITY BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

 

 

 

 

Kansas

001-37624

72-1532188

(State or other jurisdiction of

incorporation or organization)

(Commission

File Number)

(I.R.S. Employer

Identification No.)

7701 East Kellogg Drive, Suite 300

Wichita, KS

 

 

67207

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code: 316.612.6000

 

Former name or former address, if changed since last report: Not Applicable

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

1


Item 2.02Results of Operations and Financial Condition.

 

On January 23, 2019, Equity Bancshares, Inc. (the “Company”) issued a press release announcing its financial results for the fourth quarter and year ended December 31, 2018.  A copy of the press release is furnished as Exhibit 99.1 and is incorporated by reference herein.

 

The information in this Item 2.02, including Exhibit 99.1, is being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.

 

Item 7.01Regulation FD Disclosure.

 

The Company intends to hold an investor call and webcast to discuss its financial results for the fourth quarter and year ended December 31, 2018 on Thursday, January 24, 2019, at 11:00 a.m. Central Time.  The Company’s presentation to analysts and investors contains additional information about the Company’s financial results for the fourth quarter and year ended December 31, 2018 and is furnished as Exhibit 99.2 and is incorporated by reference herein.

 

The information in this Item 7.01, including Exhibit 99.2, is being furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.

 

Item 9.01Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit No.

 

Description

99.1

 

Earnings Press Release, dated January 23, 2019

99.2

 

Equity Bancshares, Inc. Investor Presentation

 

 

 

 

2


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Equity Bancshares, Inc.

 

 

Date: January 23, 2019

By: /s/ Gregory H. Kossover

 

Gregory H. Kossover

 

Executive Vice President and Chief Financial Officer


3

eqbk-ex991_8.htm

 

Exhibit 99.1

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

Equity Bancshares, Inc. Announces Fourth Quarter Results and Record Net Income for 2018

Acquires Trust Platform and Hires Key Personnel for Wealth Management and Treasury Services

Completes Three Mergers, Expanding Kansas, Missouri and Oklahoma Footprint

 

WICHITA, Kansas, January 23, 2019 (GLOBE NEWSWIRE) – Equity Bancshares, Inc. (NASDAQ: EQBK), (“Equity”, “we”, “us”, “our”), the Wichita-based holding company of Equity Bank, reported its unaudited results for the quarter and year ended December 31, 2018, including net income allocable to common stockholders for the year of $35.8 million, or $2.28 per diluted share, and $9.9 million or $0.62 per diluted share in the fourth quarter.

 

“We continue to focus on providing well-rounded and sophisticated banking solutions for our customers in our four-state franchise, including customized business products, online and mobile banking enhancements, and improved products and services, including trust and wealth management and treasury management,” said Brad Elliott, Chairman and CEO of Equity. “Our priorities for 2019 will focus on organic growth and the addition of capabilities to our platform. We’ve recently hired Gaylyn McGregor to lead our recently-acquired trust and wealth management division, and in 2018 we welcomed Shawna Palmieri to oversee treasury management for business customers. We continue to invest in talent, innovative digital services, and are becoming the financial institution of choice for banking customers in a wide range of communities.”

 

On May 4, 2018, Equity completed its mergers with Kansas Bank Corporation (“KBC”), parent company of First National Bank of Liberal/Hugoton in Liberal, Kansas, and Adams Dairy Bancshares, Inc. (“Adams”), parent company of Adams Dairy Bank, in Blue Springs, Missouri.  The KBC merger added four bank locations in Liberal, Kansas, one bank location in Hugoton, Kansas, and total assets of $336.1 million.  The Adams merger added one bank location in Blue Springs, Missouri, and total assets of $115.8 million. Results of operations of KBC and Adams are included in Equity’s 2018 results of operations subsequent to each merger.

 

Equity expanded its Oklahoma footprint by completing its merger with City Bank and Trust Company (“City Bank”) of Guymon, Oklahoma, on August 23, 2018. The merger added one bank location in Guymon, Oklahoma and total assets of $163.3 million.  Results of operations of City Bank are included in Equity’s 2018 results of operations subsequent to the merger.

 

Notable Items:

 

 

Income before taxes for the fourth quarter of 2018 was $12.9 million, or $0.80 per diluted share, compared to $7.5 million, or $0.54 per diluted share, for the same time period in 2017.  Income before taxes, adjusted to exclude merger expense, was $13.8 million, or $0.86 per diluted share, for the fourth quarter of 2018, compared to $10.7 million, or $0.78 per diluted share, for the fourth quarter of 2017.

 

Stated diluted earnings per share in the fourth quarter of 2018 were $0.62.  Merger expenses, adjusted for estimated income tax, were $712 thousand in the fourth quarter of 2018, or $0.04 per diluted share. 

 

Net income allocable to common stockholders, adjusted for merger expenses, was $10.6 million, or $0.66 per diluted share in the fourth quarter of 2018, compared to 2017 fourth quarter net income allocable to common stockholders, adjusted for merger expenses of $6.4 million, or $0.46 per diluted share.

 

Highlights of Equity’s growth include:

 

 

Total loans held for investment of $2.54 billion at December 31, 2018, as compared to total loans held for investment of $2.10 billion at December 31, 2017.  The increase of $439.7 million includes organic growth of $120.5 million, or 5.7%, $159.4 million of loans added in the KBC merger, $82.7 million of loans added in the Adams merger, and $77.1 million of loans added in the City Bank merger.

 

Total deposits were $3.12 billion at December 31, 2018 compared to $2.38 billion at December 31, 2017.  Signature Deposits, or core deposits comprised of checking accounts, savings accounts, and money market accounts, were $2.12 billion at December 31, 2018, compared to $1.61 billion at December 31, 2017.  Organic signature deposit growth was 9.3% for the year.  In addition, the KBC merger added total

 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

 

deposits of $288.4 million, the Adams merger added total deposits of $97.1 million, and the City Bank merger added total deposits of $126.9 million.

 

Total assets of $4.06 billion at December 31, 2018, compared to $3.17 billion at December 31, 2017.  The KBC merger added total assets of $336.1 million, the Adams merger added total assets of $115.8 million, and the City Bank merger added total assets of $163.3 million.

 

Book value per common share of $28.87 at December 31, 2018 and $25.62 at December 31, 2017. Tangible book value per common share of $19.08 at December 31, 2018 and $17.61 at December 31, 2017.

 

On September 24, 2018, Equity announced that it entered into a definitive branch purchase and assumption agreement to acquire certain assets and assume the deposits of two bank locations in Guymon, Oklahoma and one bank location in Cordell, Oklahoma from MidFirst Bank of Oklahoma City, Oklahoma. The transaction is expected to close later in the first quarter of 2019, subject to customary closing conditions and regulatory approval. After the transaction closes, Equity will operate 52 bank locations in four states.

 

Financial Results for Year Ended December 31, 2018

 

Net income allocable to common stockholders was $35.8 million for the year ended December 31, 2018, as compared to $20.6 million for the year ended December 31, 2017, an increase of $15.2 million, or 73.5%.  Beginning March 11, 2017, financial results reflect our merger with Prairie State Bancshares, Inc. (“Prairie”) of Hoxie, Kansas.  The merger of Prairie added three bank locations in western Kansas with total assets of $153.1 million.  Beginning November 11, 2017, financial results reflect our mergers with Eastman National Bancshares, Inc. (“Eastman”) and Cache Holdings, Inc. (“Cache”).  The merger of Eastman added one location in Newkirk, Oklahoma, three locations in Ponca City, Oklahoma, and total assets of $281.5 million.  The merger of Cache added one location in Tulsa, Oklahoma with total assets of $343.4 million.  Merger expenses of $7.5 million, $5.7 million after tax, are included in 2018 results.  These costs were incurred mainly in connection with the KBC, Adams and City Bank mergers.  Merger expenses of $5.4 million, $3.5 million after tax, are included in 2017 results. These costs were incurred mostly in connection with the Prairie, Eastman, and Cache mergers, with a very small amount attributable to the then pending KBC and Adams mergers.

 

Diluted earnings per share were $2.28 for the year ended December 31, 2018, as compared to $1.62 for the comparable period of 2017.  Weighted average fully diluted shares were 15,708,784 and 12,707,184 for the years ended December 31, 2018 and 2017.  The increase in weighted average fully diluted shares reflects the issuance of 820,849 and 344,063 shares in connection with Equity’s May 2018 mergers with KBC and Adams.

 

Net interest income was $124.8 million for the year ended December 31, 2018, as compared to $86.0 million for the year ended December 31, 2017, a $38.8 million, or 45.1% increase.  The additional net interest income was primarily driven by an increase in yield on interest-earning assets and growth in loans and securities balances, partially offset by higher interest expense as we funded the increase in earning assets with more deposits and borrowings and an overall increase in the average cost of funds.

 

Our net interest margin was 3.81% for the year ended December 31, 2018, as compared to 3.83% for the year ended December 31, 2017.

 

The provision for loan losses was $4.0 million for the year ended December 31, 2018, as compared to $3.0 million for the year ended December 31, 2017.  Net charge-offs for the twelve months ended December 31, 2018 were $1.0 million versus $887 thousand in net charge offs for the same period of 2017.

 

Total non-interest income was $19.7 million for the year ended December 31, 2018 compared to $15.4 million for the year ended December 31, 2017.  Increases in service charges and fees and debit card income are principally attributable to the addition of accounts and higher transaction volumes associated with the Prairie, Eastman, Cache, KBC, Adams and City Bank mergers.  Non-interest income includes the increase in the value of bank-owned life insurance of $2.2 million and $1.4 million for the twelve-month periods ended December 31, 2018 and 2017.  This change is the result of purchasing additional policies in late 2017.

 

 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

Total non-interest expense was $94.4 million for the year ended December 31, 2018, as compared to $67.5 million for the year ended December 31, 2017.  These results primarily reflect the full-year effect of the March 2017 Prairie merger and the November 2017 Eastman and Cache mergers, the May 2018 KBC and Adams mergers and the August 2018 City Bank merger.  Also, the results reflect additional lending, customer service, corporate and operations staff indirectly attributable to mergers and organic growth and increased data processing costs due to more accounts and higher transaction volumes.  Non-interest expense also includes merger expenses of $7.5 million ($5.7 million after tax) for the year ended December 31, 2018 while 2017 merger expenses totaled $5.4 million ($3.5 million after-tax).

 

Equity’s effective tax rate for the twelve-month period ended December 31, 2018 was 22.4%, as compared to 33.5% for the twelve-month period ended December 31, 2017.  On December 22, 2017, the Tax Cuts and Jobs Act (“Tax Reform”) was enacted and reduced the U.S. federal statutory income tax rate from the 35% rate applicable in 2017 to 21% in 2018.  Equity’s estimated annual effective tax rate was reduced approximately 12 percentage points in 2018 principally due to this reduction in the U.S. federal statutory rate.  In addition to the statutory tax rates applicable in each period, the estimated annual effective tax rate for both 2018 and 2017 reflect the levels of tax-exempt interest income, non-taxable life insurance income, non-deductible facilitative merger expenses and other non-deductible expenses included in income before income taxes as well as available federal income tax credits.  Partially offsetting the benefit of the rate reduction was a decrease in excess tax benefits associated with the exercise of stock options recorded during the year ended December 31, 2018, as compared to the same time period in the prior year.  Excess tax benefits were $26 thousand in 2018, down $344 thousand from the excess tax benefits recorded in 2017.

 

Fourth Quarter Financial Results

 

Net income allocable to common stockholders was $9.9 million for the three months ended December 31, 2018, as compared to $4.3 million for the three months ended December 31, 2017, an increase of $5.7 million or 132.2%.

 

Diluted earnings per share were $0.62 for the three months ended December 31, 2018, as compared to $0.31 for the comparable period of 2017.  Weighted average fully diluted shares were 16,095,063 and 13,809,533 for the three months ended December 31, 2018 and 2017.  The increase in weighted average fully diluted shares reflect the issuance of 2,370,688 shares in connection with Equity’s November 2017 mergers with Eastman and Cache and 1,164,912 shares in connection with Equity’s May 2018 mergers with KBC and Adams.

 

Net interest income was $33.3 million for the three months ended December 31, 2018, as compared to $24.6 million for the three months ended December 31, 2017, an $8.7 million or 35.6% increase.  The additional net interest income was primarily driven by growth in loans and securities balances and to a lesser extent an increase in average yield on loans, partially offset by an increase in interest expense as we funded the growth in earning assets with more deposits and borrowings and an overall increase in the average cost of funds.

 

Our net interest margin was 3.70% for the three months ended December 31, 2018, as compared to 3.79% for the three months ended December 31, 2017.  The decrease in net interest margin was due to the cost of interest-bearing liabilities rising at a faster rate than interest-earning assets during the last quarter of the year. The increase in cost of funds is primarily from the increase in cost of both retail and public fund deposits.  The cost of retail deposits have increased as the general level of interest rates have risen and from an increased level of market competition on this type of deposit, which are desirable due to its lower level of interest rate sensitivity.  The cost of public fund deposits have increased due to the level of competition over these deposits, from both other financial institutions and state investment funds, and due to the timing of the investment of these funds in an elevated interest rate environment.

 

The provision for loan losses was $750 thousand for the three months ended December 31, 2018, as compared to $503 thousand for the three months ended December 31, 2017.  For the three months ended December 31, 2018, we had net charge-offs of $307 thousand, as compared to a net recovery of $26 thousand for the same period in 2017.

 

Total non-interest income for the quarter ended December 31, 2018 was $5.4 million, compared to $4.1 million for the quarter ended December 31, 2017.  Increases in service charges and fees and debit card income are principally

 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

attributable to the addition of accounts and higher transaction volumes associated with the Eastman, Cache, KBC and Adams mergers and to a lesser extent, the August 2018 merger with City Bank.  Non-interest income includes the increase in value of bank-owned life insurance of $518 thousand and $377 thousand for the three-month periods ended December 31, 2018 and 2017.

 

Total non-interest expense was $25.1 million for the quarter ended December 31, 2018, compared to $20.7 million for the quarter ended December 31, 2017.  These results reflect the effect of the November 2017 addition of five locations in northern Oklahoma; the May 2018 addition of five locations in southwest Kansas plus one location in Blue Springs, Missouri; and the August 2018 addition of one location in Guymon, Oklahoma.  In addition, the results reflect added lending, customer service, corporate and operations staff indirectly attributable to mergers and organic growth and increased data processing costs due to more accounts and higher transaction volumes.  Non-interest expense also includes merger expenses of $938 thousand ($712 thousand after tax) for the three months ended December 31, 2018.  Merger expenses for the three months ended December 31, 2017, totaled $3.3 million ($2.1 million thousand after tax).

 

Equity’s effective tax rate was 23.0% for the three months ended December 31, 2018, as compared to 42.8% for the quarter ended December 31, 2017.  The effective tax rates for each of the comparable periods reflect the applicable statutory tax rates as well as the levels of tax-exempt interest income, non-taxable life insurance income, non-deductible facilitative merger expense and other non-deductible expense included in income before income taxes as well as available federal income tax credits.  The 2017 provision for income taxes also includes a fourth quarter charge of $1.1 million related to the re-measurement of Equity’s net deferred tax assets upon the enactment of Tax Reform.

 

Loans, Deposits and Total Assets

 

Loans held for investment were $2.54 billion at December 31, 2018, as compared to $2.10 billion at December 31, 2017, an increase of $439.7 million.  The increase in loans held for investment includes $159.4 million and $82.7 million of net loans acquired in the May 2018 KBC and Adams mergers, $77.1 million of net loans acquired in the August 2018 City Bank merger plus $120.5 million of organic loan growth.

 

As of December 31, 2018, Equity’s allowance for loan losses to total loans was 0.45%, as compared to 0.40% at December 31, 2017.  Total reserves, including purchase discounts, to total loans were approximately 1.03% as of December 31, 2018, as compared to 1.21% at December 31, 2017.  Nonperforming assets of $39.6 million as of December 31, 2018, were 0.97% of total assets and include nonperforming assets of $979 thousand acquired in the KBC merger, $1.1 million acquired in the Adams mergers and $6.3 million acquired in the City Bank merger.  Nonperforming assets at December 31, 2017, were $48.2 million or 1.52% of total assets.

 

Total deposits were $3.12 billion at December 31, 2018, as compared to $2.38 billion at December 31, 2017.  Total deposits increased $741.4 million between December 31, 2017, and December 31, 2018.  This increase included $288.4 million of deposits assumed in the KBC merger, $97.1 million of deposits assumed in the Adams merger, $126.9 million of deposits assumed in the City Bank merger and $229.0 million in organic growth. Signature deposits were $2.12 billion at December 31, 2018, as compared to $1.61 billion at December 31, 2017.

 

At December 31, 2018, Equity had consolidated total assets of $4.06 billion, as compared to $3.17 billion at December 31, 2017, an increase of $891.2 million.  The increase in total assets includes $336.1 million of total assets acquired in the KBC merger, $115.8 million of total assets acquired in the Adams merger and $163.3 million of total assets acquired in the City Bank merger.

 

Capital and Borrowings

 

In connection with the KBC and Adams mergers, Equity issued 820,849 shares and 344,063 shares, in each case, valued at $39.11 per share, Equity’s closing price on May 4, 2018.  Net of $207 thousand of stock issuance costs, the KBC merger added $31.9 million to stockholders’ equity while the Adams merger added $13.2 million to stockholders’ equity, net of $237 thousand of stock issuance costs.

 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

 

At December 31, 2018, common stockholders’ equity totaled $455.9 million, $28.87 per common share, compared to $374.1 million, $25.62 per common share, at December 31, 2017.  Tangible common equity was $301.3 million and tangible book value per common share was $19.08 at December 31, 2018.  Tangible common equity was $257.2 million and tangible book value per common share was $17.61 at December 31, 2017.  The ratio of common equity tier 1 capital to risk-weighted assets was approximately 11.01% and the total capital to risk-weighted assets was approximately 11.92% at December 31, 2018.

 

Non-GAAP Financial Measures

 

This press release includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of this press release.

 

Conference Call and Webcast

 

Equity’s Chairman and Chief Executive Officer, Brad Elliott, and Chief Financial Officer, Greg Kossover, will hold a conference call and webcast to discuss fourth quarter and full-year 2018 results on Thursday, January 24, 2019 at 11:00 a.m. central time.

 

Investors, news media and other participants should register for the call or audio webcast at investor.equitybank.com. On Thursday, January 24, 2019, participants may also dial into the call toll-free at (844) 534-7311 from anywhere in the U.S. or (574) 990-1419 internationally, using conference ID no. 4367695.

 

Participants are encouraged to dial into the call or access the webcast approximately 10 minutes prior to the start time.  Presentation slides to pair with the call or webcast will be posted one hour prior to the call at investor.equitybank.com.

 

A replay of the call and webcast will be available two hours following the close of the call until January 31, 2019, accessible at (855) 859-2056 with conference ID no. 4367695 at investor.equitybank.com.

About Equity Bancshares, Inc.

Equity Bancshares, Inc. is the holding company for Equity Bank, offering a full range of financial solutions, including commercial loans, consumer banking, mortgage loans, trust and wealth management services and treasury management services, while delivering the high-quality, relationship-based customer service of a community bank. Equity’s common stock is traded on the NASDAQ Global Select Market under the symbol “EQBK.” Learn more at www.equitybank.com.

 

No Offer or Solicitation

 

This press release shall not constitute an offer to sell, a solicitation of an offer to sell, or the solicitation or an offer to buy any securities. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirement of Section 10 of the Securities Act of 1933, as amended.

 

Special Note Concerning Forward-Looking Statements

 

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  These forward-looking statements reflect the current views of Equity’s management with respect to, among other things, future events and Equity’s financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature.  These forward-looking statements are not historical facts, and are

 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

based on current expectations, estimates and projections about Equity’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond Equity’s control. Accordingly, Equity cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although Equity believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.  Factors that could cause actual results to differ materially from Equity’s expectations include competition from other financial institutions and bank holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses; and similar variables. 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 Equity’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 16, 2018 and any updates to those risk factors set forth in Equity’s subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if Equity’s underlying assumptions prove to be incorrect, actual results may differ materially from what Equity anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and Equity does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, and it is not possible for us to predict those events or how they may affect us. In addition, Equity cannot assess the impact of each factor on Equity’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Equity or persons acting on Equity’s behalf may issue.

 

 

Media Contact:

 

John J. Hanley

SVP, Director of Marketing

Equity Bancshares, Inc.

(816) 505-4063

jhanley@equitybank.com

 

 

Investor Contact:

 

Jacob Willis

Investor Relations Officer

Equity Bancshares, Inc.

(316) 779-1675

jwillis@equitybank.com

 

 

 

Unaudited Financial Tables

 

Table 1. Selected Financial Highlights

 

Table 2. Year to Date Analysis of Changes in Net Interest Income

 

Table 3. Quarterly Analysis of Changes in Net Interest Income

 

Table 4. Consolidated Balance Sheets

 

Table 5. Consolidated Statements of Income

 

Table 6. Non-GAAP Financial Measures


 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

TABLE 1. SELECTED FINANCIAL HIGHLIGHTS (Unaudited)

(Dollars in thousands, except per share data)

 

As of and for the three months ended

 

December 31,

2018

September 30,

2018

June 30,

2018

March 31,

2018

December 31,

2017

Statement of Income Data

 

 

 

 

 

Net interest income

$33,336

$32,755

$30,920

$27,787

$24,589

Provision for loan losses

750

1,291

750

1,170

503

Net gains (losses) from securities transactions

5

(4)

(2)

(8)

Other non-interest income

5,444

5,437

4,594

4,259

4,104

Total non-interest income

5,449

5,433

4,592

4,251

4,104

Merger expenses

938

757

5,236

531

3,267

Other non-interest expense

24,200

22,890

20,739

19,096

17,451

Total non-interest expense

25,138

23,647

25,975

19,627

20,718

Income before income taxes

12,897

13,250

8,787

11,241

7,472

Provision for income taxes

2,972

2,928

1,920

2,530

3,198

Net income

9,925

10,322

6,867

8,711

4,274

Net income allocable to common stockholders

9,925

10,322

6,867

8,711

4,274

Basic earnings per share

0.63

0.65

0.45

0.60

0.32

Diluted earnings per share

0.62

0.64

0.44

0.58

0.31

 

 

 

 

 

 

Balance Sheet Data (at period end)

 

 

 

 

 

Securities available-for-sale

$168,875

$172,388

$180,238

$174,717

$162,272

Securities held-to-maturity

748,356

713,899

665,995

522,021

535,462

Gross loans held for investment

2,542,992

2,557,055

2,411,471

2,125,324

2,103,279

Allowance for loan losses

11,454

11,010

10,083

9,316

8,498

Intangible assets, net

154,665

155,430

146,538

115,032

116,922

Total assets

4,061,716

3,931,036

3,712,185

3,176,062

3,170,509

Total deposits

3,123,447

2,821,246

2,635,048

2,368,297

2,382,013

Non-time deposits

2,115,541

1,969,715

1,829,902

1,647,105

1,605,514

Borrowings

464,676

652,755

631,501

414,415

401,652

Total liabilities

3,605,775

3,487,799

3,278,903

2,794,575

2,796,365

Total stockholders’ equity

455,941

443,237

433,282

381,487

374,144

Tangible common equity*

301,276

287,807

286,744

266,455

257,222

 

 

 

 

 

 

Selected Average Balance Sheet Data (quarterly average)

 

 

 

 

 

Total gross loans receivable

$2,590,610

$2,516,833

$2,317,071

$2,122,973

$1,850,045

Investment securities

893,642

860,940

767,038

699,055

669,220

Interest-earning assets

3,578,487

3,457,871

3,158,187

2,883,960

2,573,043

Total assets

3,935,722

3,804,114

3,475,786

3,169,131

2,820,548

Interest-bearing deposits

2,501,227

2,251,937

2,148,361

2,043,784

1,821,850

Borrowings

480,417

642,575

495,558

389,120

330,651

Total interest-bearing liabilities

2,981,644

2,894,512

2,643,919

2,432,904

2,152,501

Total deposits

2,991,657

2,709,741

2,556,982

2,390,648

2,140,490

Total liabilities

3,486,272

3,364,343

3,062,312

2,791,236

2,483,029

Total stockholders’ equity

449,450

439,771

413,474

377,895

337,519

Tangible common equity*

294,506

289,515

279,328

261,261

240,899

 

 

 

 

 

 

Performance Ratios

 

 

 

 

 

Return on average assets (ROAA) annualized

1.00%

1.08%

0.79%

1.11%

0.60%

Return on total average stockholders equity (ROAE) annualized

8.76%

9.31%

6.66%

9.35%

5.02%

Return on average tangible common equity (ROATCE) annualized*

14.17%

14.91%

10.58%

14.01%

7.41%

Yield on loans annualized

5.91%

5.73%

5.73%

5.55%

5.40%

Cost of interest-bearing deposits annualized

1.45%

1.15%

1.00%

0.94%

0.87%

Cost of total deposits annualized

1.21%

0.95%

0.84%

0.80%

0.74%

Net interest margin annualized

3.70%

3.76%

3.93%

3.91%

3.79%

Efficiency ratio*

62.40%

59.93%

58.40%

59.59%

60.82%

Non-interest income / average assets

0.55%

0.57%

0.53%

0.54%

0.58%

Non-interest expense / average assets

2.53%

2.47%

3.00%

2.51%

2.91%

 

 

 

 

 

 

Capital Ratios

 

 

 

 

 

Tier 1 Leverage Ratio

8.60%

8.60%

9.36%

9.45%

10.33%

Common Equity Tier 1 Capital Ratio

11.01%

10.57%

11.13%

11.80%

11.56%

Tier 1 Risk Based Capital Ratio

11.52%

11.07%

11.65%

12.41%

12.17%

Total Risk Based Capital Ratio

11.92%

11.46%

12.03%

12.81%

12.54%

Total stockholders’ equity to total assets

11.23%

11.28%

11.67%

12.01%

11.80%

Tangible common equity to tangible assets*

7.71%

7.62%

8.04%

8.70%

8.42%

Book value per common share

$28.87

$28.07

$27.44

$26.09

$25.62

Tangible book value per common share*

$19.08

$18.22

$18.16

$18.22

$17.61

Tangible book value per diluted common share*

$18.73

$17.86

$17.78

$17.85

$17.29

 

* The value noted is considered a Non-GAAP financial measure.  For a reconciliation of Non-GAAP financial measures, see Table 6. Non-GAAP Financial Measures

 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

TABLE 2. YEAR TO DATE ANALYSIS OF CHANGES IN NET INTEREST INCOME (Unaudited)

(Dollars in thousands)

 

 

Year ended 12/31/2018

 

 

Year ended 12/31/2017

 

 

Average Outstanding Balance

 

Interest Income/ Expense

 

Average Yield/ Rate (3) (4)

 

 

Average Outstanding Balance

 

Interest Income/ Expense

 

Average Yield/ Rate (3) (4)

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans (1)

$

2,388,509

 

$

137,048

 

 

5.74

%

 

$

1,576,364

 

$

85,662

 

 

5.43

%

Total securities

 

805,855

 

 

22,032

 

 

2.73

%

 

 

621,407

 

 

15,683

 

 

2.52

%

Federal funds sold and other

 

77,681

 

 

2,476

 

 

3.19

%

 

 

47,937

 

 

1,348

 

 

2.81

%

Total interest-earning assets

 

3,272,045

 

 

161,556

 

 

4.94

%

 

 

2,245,708

 

 

102,693

 

 

4.57

%

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-bearing demand and savings

 

1,401,326

 

 

12,683

 

 

0.91

%

 

 

954,038

 

 

5,080

 

 

0.53

%

Certificates of deposit

 

836,298

 

 

13,004

 

 

1.56

%

 

 

647,998

 

 

7,642

 

 

1.18

%

Total interest-bearing deposits

 

2,237,624

 

 

25,687

 

 

1.15

%

 

 

1,602,036

 

 

12,722

 

 

0.79

%

FHLB advances & LOC

 

430,490

 

 

9,039

 

 

2.10

%

 

 

258,951

 

 

2,909

 

 

1.12

%

Other borrowings

 

72,062

 

 

2,032

 

 

2.82

%

 

 

39,999

 

 

1,060

 

 

2.65

%

Total interest-bearing liabilities

 

2,740,176

 

 

36,758

 

 

1.34

%

 

 

1,900,986

 

 

16,691

 

 

0.88

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

$

124,798

 

 

 

 

 

 

 

 

$

86,002

 

 

 

 

Interest rate spread

 

 

 

 

 

 

 

3.60

%

 

 

 

 

 

 

 

 

3.69

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin (2)

 

 

 

 

 

 

 

3.81

%

 

 

 

 

 

 

 

 

3.83

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Average loan balances include nonaccrual loans.

 

(2) Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets for the period.

 

(3) Tax exempt income is not included in the above table on a tax equivalent basis.

 

(4) Actual unrounded values are used to calculate the reported yield or rate disclosed.  Accordingly, recalculations using the amounts in thousands as disclosed in this report may not produce the same amounts.

 

 

 

 

 

Total Increase/(Decrease)

 

 

Volume Variance (1)

 

Yield/Rate Variance (1)

 

Total Variance

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

Loans

$

46,358

 

$

5,028

 

$

51,386

 

Total securities

 

4,908

 

 

1,441

 

 

6,349

 

Federal funds sold and other

 

928

 

 

200

 

 

1,128

 

Total interest-earning assets

 

52,194

 

 

6,669

 

 

58,863

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

Total interest-bearing demand and savings

 

3,131

 

 

4,472

 

 

7,603

 

Certificates of deposit

 

2,558

 

 

2,804

 

 

5,362

 

Total interest-bearing deposits

 

5,689

 

 

7,276

 

 

12,965

 

FHLB advances & LOC

 

2,652

 

 

3,478

 

 

6,130

 

Other borrowings

 

780

 

 

192

 

 

972

 

Total interest-bearing liabilities

 

9,121

 

 

10,946

 

 

20,067

 

 

 

 

 

 

 

 

 

 

 

Net interest income

$

43,073

 

$

(4,277

)

$

38,796

 

 

 

 

 

 

 

 

 

 

 

(1) The effect of changes in volume is determined by multiplying the change in volume by the previous year's average rate. Similarly, the effect of rate changes is calculated by multiplying the change in average rate by the prior year's volume. The changes attributable to both volume and rate, which cannot be segregated, have been allocated to the volume variance and the rate variance in proportion to the relationship of the absolute dollar amount of the change in each.

 

 

 


 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

TABLE 3. QUARTERLY ANALYSIS OF CHANGES IN NET INTEREST INCOME (Unaudited)

(Dollars in thousands)

 

 

Quarter ended 12/31/2018

 

 

Quarter ended 12/31/2017

 

 

Average Outstanding Balance

 

Interest Income/ Expense

 

Average Yield/ Rate (3) (4)

 

 

Average Outstanding Balance

 

Interest Income/ Expense

 

Average Yield/ Rate (3) (4)

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans (1)

$

2,590,610

 

$

38,564

 

 

5.91

%

 

$

1,850,045

 

$

25,180

 

 

5.40

%

Total securities

 

893,642

 

 

6,360

 

 

2.82

%

 

 

669,220

 

 

4,243

 

 

2.52

%

Federal funds sold and other

 

94,235

 

 

656

 

 

2.76

%

 

 

53,778

 

 

385

 

 

2.84

%

Total interest-earning assets

 

3,578,487

 

 

45,580

 

 

5.05

%

 

 

2,573,043

 

 

29,808

 

 

4.60

%

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-bearing demand and savings

 

1,524,972

 

 

4,528

 

 

1.18

%

 

 

1,092,465

 

 

1,700

 

 

0.62

%

Certificates of deposit

 

976,255

 

 

4,593

 

 

1.87

%

 

 

729,385

 

 

2,282

 

 

1.24

%

     Total interest-bearing deposits

 

2,501,227

 

 

9,121

 

 

1.45

%

 

 

1,821,850

 

 

3,982

 

 

0.87

%

FHLB advances & LOC

 

395,239

 

 

2,491

 

 

2.50

%

 

 

277,131

 

 

942

 

 

1.35

%

Other borrowings

 

85,178

 

 

632

 

 

2.94

%

 

 

53,520

 

 

295

 

 

2.19

%

Total interest-bearing liabilities

 

2,981,644

 

 

12,244

 

 

1.63

%

 

 

2,152,501

 

 

5,219

 

 

0.96

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

$

33,336

 

 

 

 

 

 

 

 

$

24,589

 

 

 

 

Interest rate spread

 

 

 

 

 

 

 

3.42

%

 

 

 

 

 

 

 

 

3.64

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin (2)

 

 

 

 

 

 

 

3.70

%

 

 

 

 

 

 

 

 

3.79

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Average loan balances include nonaccrual loans.

 

(2) Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets for the period.

 

(3) Tax exempt income is not included in the above table on a tax equivalent basis.

 

(4) Actual unrounded values are used to calculate the reported yield or rate disclosed.  Accordingly, recalculations using the amounts in thousands as disclosed in this report may not produce the same amounts.

 

 

 

 

 

Total Increase/(Decrease)

 

 

Volume Variance (1)

 

Yield/Rate Variance (1)

 

Total Variance

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

Loans

$

10,844

 

$

2,540

 

$

13,384

 

Total securities

 

1,539

 

 

578

 

 

2,117

 

Federal funds sold and other

 

282

 

 

(11

)

 

271

 

Total interest-earning assets

 

12,665

 

 

3,107

 

 

15,772

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

Total interest-bearing demand and savings

 

887

 

 

1,941

 

 

2,828

 

Certificates of deposit

 

929

 

 

1,382

 

 

2,311

 

     Total interest-bearing deposits

 

1,816

 

 

3,323

 

 

5,139

 

FHLB advances & LOC

 

516

 

 

1,033

 

 

1,549

 

Other borrowings

 

277

 

 

60

 

 

337

 

Total interest-bearing liabilities

 

2,609

 

 

4,416

 

 

7,025

 

 

 

 

 

 

 

 

 

 

 

Net interest income

$

10,056

 

$

(1,309

)

$

8,747

 

 

 

 

 

 

 

 

 

 

 

(1) The effect of changes in volume is determined by multiplying the change in volume by the previous year's average rate. Similarly, the effect of rate changes is calculated by multiplying the change in average rate by the prior year's volume. The changes attributable to both volume and rate, which cannot be segregated, have been allocated to the volume variance and the rate variance in proportion to the relationship of the absolute dollar amount of the change in each.

 

 

 

 

 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

TABLE 4. CONSOLIDATED BALANCE SHEETS (Unaudited)

(Dollars in thousands)

 

December 31,

2018

December 31,

2017

ASSETS

 

 

Cash and due from banks

$192,735

$48,034

Federal funds sold

83

4,161

 

 

 

Cash and cash equivalents

192,818

52,195

 

 

 

Interest-bearing time deposits in other banks

4,991

3,496

Available-for-sale securities

168,875

162,272

Held-to-maturity securities, fair value of $739,989 and $532,744

748,356

535,462

Loans held for sale

35,388

16,344

Loans, net of allowance for loan losses of $11,454 and $8,498

2,531,538

2,094,781

Other real estate owned, net

6,372

7,907

Premises and equipment, net

80,442

63,449

Bank-owned life insurance

73,105

68,384

Federal Reserve Bank and Federal Home Loan Bank stock

29,214

24,373

Interest receivable

17,372

12,371

Goodwill

131,712

104,907

Core deposit intangibles, net

21,725

10,738

Other

19,808

13,830

 

 

 

Total assets

$4,061,716

$3,170,509

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

Deposits

 

 

Demand

$503,831

$366,530

 

 

 

Total non-interest bearing deposits

503,831

366,530

 

 

 

Savings, NOW and money market

1,611,710

1,238,984

Time

1,007,906

776,499

 

 

 

Total interest-bearing deposits

2,619,616

2,015,483

 

 

 

Total deposits

3,123,447

2,382,013

 

 

 

Federal funds purchased and retail repurchase agreements

50,068

37,492

Federal Home Loan Bank advances

384,898

347,692

Bank stock loan

15,450

2,500

Subordinated debentures

14,260

13,968

Contractual obligations

3,965

1,967

Interest payable and other liabilities

13,687

10,733

Total liabilities

3,605,775

2,796,365

 

 

 

 

 

 

Stockholders’ equity

 

 

Common stock

173

161

Additional paid-in capital

379,085

331,339

Retained earnings

101,326

65,512

Accumulated other comprehensive loss

(4,867)

(3,092)

Employee stock loans

(121)

(121)

Treasury stock

(19,655)

(19,655)

Total stockholders’ equity

455,941

374,144

Total liabilities and stockholders’ equity

$4,061,716

$3,170,509

 


 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

TABLE 5. CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(Dollars in thousands, except per share data)

 

 

Three Months Ended

December 31,

Year Ended

December 31,

 

2018

2017

2018

2017

Interest and dividend income

 

 

 

 

Loans, including fees

$38,564

$25,180

$137,048

$85,662

Securities, taxable

5,272

3,378

17,943

12,308

Securities, nontaxable

1,088

865

4,089

3,375

Federal funds sold and other

656

385

2,476

1,348

 

 

 

 

 

Total interest and dividend income

45,580

29,808

161,556

102,693

 

 

 

 

 

Interest expense

 

 

 

 

Deposits

9,121

3,982

25,687

12,722

Federal funds purchased and retail repurchase agreements

37

24

114

64

Federal Home Loan Bank advances

2,491

942

9,039

2,909

Bank stock loan

283

16

731

   16

Subordinated debentures

312

255

1,187

980

 

 

 

 

 

Total interest expense

12,244

5,219

36,758

16,691

 

 

 

 

 

Net interest income

33,336

24,589

124,798

86,002

Provision for loan losses

750

503

3,961

2,953

 

 

 

 

 

Net interest income after provision for loan losses

32,586

24,086

120,837

83,049

Non-interest income

 

 

 

 

Service charges and fees

2,029

1,522

7,250

5,319

Debit card income

1,736

1,162

6,178

4,547

Mortgage banking

281

409

1,298

1,955

Increase in value of bank-owned life insurance

518

377

2,199

1,445

Net gains (losses) from securities transactions

5

(9)

271

Other

880

634

2,809

1,903

 

 

 

 

 

Total non-interest income

5,449

4,104

19,725

15,440

 

 

 

 

 

Non-interest expense

 

 

 

 

Salaries and employee benefits

13,137

9,565

48,018

33,960

Net occupancy and equipment

2,188

1,684

8,126

6,305

Data processing

2,257

1,357

8,094

4,927

Professional fees

1,157

626

3,402

2,363

Advertising and business development

916

428

3,002

2,105

Telecommunications

523

225

1,775

1,191

FDIC insurance

325

330

1,536

945

Courier and postage

304

251

1,183

935

Free nation-wide ATM cost

369

249

1,355

932

Amortization of core deposit intangibles

740

338

2,443

1,025

Loan expense

195

335

1,005

993

Other real estate owned

(23)

29

(71)

523

Merger expenses

938

3,267

7,462

5,352

Other

2,112

2,034

7,057

5,907

 

 

 

 

 

Total non-interest expense

25,138

20,718

94,387

67,463

 

 

 

 

 

Income before income taxes

12,897

7,472

46,175

31,026

Provision for income taxes

2,972

3,198

10,350

10,377

 

 

 

 

 

Net income

$9,925

$4,274

$35,825

$20,649

 

 

 

 

 

Net income allocable to common stockholders

$9,925

$4,274

$35,825

$20,649

 

 

 

 

 

Basic earnings per share

$0.63

$0.32

$2.33

$1.66

 

 

 

 

 

Diluted earnings per share

$0.62

$0.31

$2.28

$1.62


 


 

Equity Bancshares, Inc.

PRESS RELEASE - 01/23/2019

TABLE 6. Non-GAAP Financial Measures (Unaudited)

(Dollars in thousands, except per share data)

 

 

As of and for the three months ended

 

December 31,

2018

September 30,

2018

June 30,

2018

March 31,

2018

December 31,

2017

Total stockholders’ equity

$455,941

$443,237

$433,282

$381,487

$374,144

Less: goodwill

131,712

131,723

125,485

103,412

104,907

Less: core deposit intangibles, net

21,725

22,466

19,800

10,355

10,738

Less: mortgage servicing asset, net

11

13

14

16

17

Less: naming rights, net

1,217

1,228

1,239

1,249

1,260

 

 

 

 

 

 

Tangible common equity

$301,276

$287,807

$286,744

$266,455

$257,222

Common shares issued at period end

15,793,095

15,792,695

15,780,777

14,609,414

14,605,607

RSU shares vested

6,768

11,844

 

 

 

 

 

 

Common shares outstanding at period end

15,793,095

15,792,695

15,787,545

14,621,258

14,605,607

 

 

 

 

 

 

Diluted common shares outstanding at period end

16,085,729

16,118,067

16,131,096

14,923,798

14,873,257

 

 

 

 

 

 

Book value per common share

$28.87

$28.07

$27.44

$26.09

$25.62

 

 

 

 

 

 

Tangible book value per common share

$19.08

$18.22

$18.16

$18.22

$17.61

 

 

 

 

 

 

Tangible book value per diluted common share

$18.73

$17.86

$17.78

$17.85

$17.29

 

 

 

 

 

 

Total assets

$4,061,716

$3,931,036

$3,712,185

$3,176,062

$3,170,509

Less: goodwill

131,712

131,723

125,485

103,412

104,907

Less: core deposit intangibles, net

21,725

22,466

19,800

10,355

10,738

Less: mortgage servicing asset, net

11

13

14

16

17

Less: naming rights, net

1,217

1,228

1,239

1,249

1,260

 

 

 

 

 

 

Tangible assets

$3,907,051

$3,775,606

$3,565,647

$3,061,030

$3,053,587

 

 

 

 

 

 

Total stockholders’ equity to total assets

11.23%

11.28%

11.67%

12.01%

11.80%

 

 

 

 

 

 

Tangible common equity to tangible assets

7.71%

7.62%

8.04%

8.70%

8.42%

 

 

 

 

 

 

Total average stockholders’ equity

$449,450

$439,771

$413,474

$377,895

$337,519

Less: average intangible assets and preferred stock

154,944

150,256

134,146

116,634

96,620

 

 

 

 

 

 

Average tangible common equity

$294,506

$289,515

$279,328

$261,261

$240,899

 

 

 

 

 

 

Net income allocable to common stockholders

$9,925

$10,322

$6,867

$8,711

$4,274

Amortization of intangible assets

752

707

637

396

349

Less: tax effect of intangible assets amortization

158

148

134

83

122

 

 

 

 

 

 

Adjusted net income allocable to common stockholders

$10,519

$10,881

$7,370

$9,024

$4,501

 

 

 

 

 

 

Return on total average stockholders’ equity (ROAE)

annualized

8.76%

9.31%

6.66%

9.35%

5.02%

 

 

 

 

 

 

Return on average tangible common equity (ROATCE) annualized

14.17%

14.91%

10.58%

14.01%

7.41%

 

 

 

 

 

 

Non-interest expense

$25,138

$23,647

$25,975

$19,627

$20,718

Less: merger expenses

938

757

5,236

531

3,267

 

 

 

 

 

 

Non-interest expense, excluding merger expenses

$24,200

$22,890

$20,739

$19,096

$17,451

 

 

 

 

 

 

Net interest income

$33,336

$32,755

$30,920

$27,787

$24,589

 

 

 

 

 

 

Non-interest income

$5,449

$5,433

$4,592

$4,251

$4,104

Less: net gains (losses) from securities transactions

5

(4)

(2)

(8)

 

 

 

 

 

 

Non-interest income, excluding net gains (losses) from securities transactions

$5,444

$5,437

$4,594

$4,259

$4,104

 

 

 

 

 

 

Net interest income plus non-interest income, excluding net gains (losses) from securities transactions

$38,780

$38,192

$35,514

$32,046

$28,693

Non-interest expense to net interest income plus non-interest income

64.81%

61.92%

73.14%

61.26%

72.21%

 

 

 

 

 

 

Efficiency ratio

62.40%

59.93%

58.40%

59.59%

60.82%

 

 

 

eqbk-ex992_9.pptx.htm

Slide 1

Q4 & 2018 Results Presentation January 23, 2019 Exhibit 99.2

Slide 2

Disclaimers Special Note Concerning Forward-Looking Statements This investor presentation contains “forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect the current views of Equity Bancshares, Inc. (“Equity”) management with respect to, among other things, future events and Equity’s financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about Equity’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond Equity’s control. Accordingly, Equity cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although Equity believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from Equity’s expectations include competition from other financial institutions and bank holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses, and similar variables. 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 Equity’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 16, 2018 and any updates to those risk factors set forth in Equity’s subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if Equity’s underlying assumptions prove to be incorrect, actual results may differ materially from what Equity anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and Equity does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, and it is not possible for us to predict those events or how they may affect us. In addition, Equity cannot assess the impact of each factor on Equity’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Equity or persons acting on Equity’s behalf may issue. Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results. NON-GAAP FINANCIAL MEASURES This presentation contains certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of this presentation. Numbers in the presentation may not sum due to rounding.

Slide 3

NASDAQ: EQBK 15.8 million shares outstanding / $549.8 million (1) $4.06 billion 1.00% / 13.43% Market Cap 60.1% Exchange / Ticker Total Assets YTD ROAA / ROATCE (2) Efficiency Ratio (2) Locations FTEs Loan Portfolio 49 branches in Kansas, Missouri, Arkansas and Oklahoma Approximately 627 49% of loans in commercial real estate, 17% in residential real estate, and 22% in commercial About EQBK Note: All financial data is as of or for period ended December 31, 2018 unless otherwise noted. Market Cap calculated based on January 18, 2019 closing price of $34.81 (2) Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation.

Slide 4

Equity Bancshares – Share Price & Consensus Estimates As of January 18, 2019 market closing. Estimates as of January 3, 2019. Based on 15,793,095 shares outstanding as of January 18, 2019. Non-GAAP financial measures. See the non-GAAP reconciliation at the end of this presentation. Recent Price(1)   $34.81 Median Consensus Price Target(2) $43.50 Tangible Book Value per Share(4) $19.08 2018 Q4 EPS Consensus Estimate(2) $ 0.74 2018 EPS Consensus Estimate(2) $ 2.48 2019 EPS Consensus Estimate(2) $ 3.10 Price to 2018 Consensus Earnings(1,2) 14.0x Price to 2019 Consensus Earnings(1,2) 11.2x Price to Tangible Book Value per Share(1,4) 1.8x Market Capitalization(1,3)   $549.8

Slide 5

Pending Acquisition of Three Branches in Guymon and Cordell, Oklahoma from MidFirst Bank Announced: September 24, 2018 Anticipated Close: Late First Quarter 2019

Slide 6

Pro Forma Footprint & Demographics EQBK MidFirst Bank Branches (3) Footprint 52 branches in 27 counties across 4 states Strong strategic positioning, with branches along I-70 and I-35 Branches clustered around key areas such as Wichita, Topeka, Kansas City, Tulsa, Southwest Kansas, Southeast Kansas, Northern Oklahoma, Northwest Oklahoma, Western Missouri, and Arkansas Total population of current markets served of approximately 5 million Median household income of approximately $53,000 Source: S&P Capital IQ Unemployment rates as of November 2018 Unemployment Rates(1) Kansas: 2.9% Missouri: 2.5% Arkansas: 3.3% Oklahoma: 2.8% USA: 3.5% Key Industries Transportation Manufacturing Healthcare Agriculture

Slide 7

Note: Yellow shading indicates M&A activity; gray shading indicates capital activity * Data as of 12/31/2007. ** Data as of 12/31/2011. *** Data as of 12/31/2016 ****As reported for the year ended 12/31/2018. 2009 $8.8MM of TARP issued Opened 2 branches in Overland Park, KS 2014 Repurchased 1.3mm shares Refinanced TARP with Loan Close/Sell 3 branches and opened branch Waterfront 2012 First Community Bancshares (FCB) merger $20.4MM Capital Raise 2011 Repaid TARP with SBLF Purchase of 4 branches from Citizens Bancshares (Topeka) 2003-2004 Acquisition of National Bank of Andover Rebrand as Equity Bank 2005 Purchase of 2 Wichita branches from Hillcrest Bancshares 2006 Acquisition of Charter of FNB of Sarcoxie, MO Acquisition of Mortgage Centre, LC Opened 2 branches in MO 2008 Ellis State Bank acquisition (Ellis/Hays) Branch opened in Lee’s Summit, MO 2010 $20.0MM Capital Raise to fund growth 2013 Integrate FCB and double earnings CFO and CRO roles filled Implement repositioning initiatives 2007 Signature Bank KC acquisition Phase I Phase II Phase III Start-Up 2003 - 2007 Growth 2008 - 2011 Leverage Infrastructure Profitably 2012 - 2016 $2.2B 0.55% Total Assets ROA $287MM 0.49% $610MM 0.46% * ** *** 2015 First Indep. (FFSL) merger IPO Continue Building Value via Strategic Execution 2016 Community First (CFBI) merger (closed November ‘16) Completed $35.4MM private placement capital raise (PIPE) Phase IV Platform for Best in Class 2017-present 2017 Closed Prairie State merger (March) Hired President: Wendell Bontrager, CIO: John Blakeney Entered Oklahoma Closed Patriot Bank merger (November) Closed Eastman Bank merger (November) $3.2B year-end asset size $4.1B 1.00% **** 2018 Hired COO: Craig Anderson, CCO: Craig Mayo Closed First National Bank Liberal/Hugoton (May) Closed Adams Dairy Bank merger (May) Closed merger with City Bank and Trust (August) Announced acquisition of 3 branches from MidFirst Bank Hired Gaylyn McGregor, Director of Trust and Wealth Management

Slide 8

Diluted earnings per share of $0.62 for 4Q 2018 Net income to common stockholders, adjusted for after-tax merger expense, was $10.6 million Core EPS of $0.66 Completed the acquisition of City Bank & Trust Company and announced the pending acquisition of 3 branches from MidFirst Bank Capital Ratios as of 12/31/2018: Bank level Tier 1 Leverage of 8.6% Bank level Total Capital to Risk Weighted Assets of 12.0% Tangible Common Equity to Tangible Assets of 7.7%(1) Tangible common book value per share of $19.08 (1) Total organic deposit growth of $229.0 million 2018 ROAA of 1.00% and ROATCE of 14.17%(1) 2018 Fourth Quarter Highlights $9.9 million Net income to common stockholders (1) Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation Added Trust and Wealth Management ROAA 1.00% Return on Average Assets $229.0 million Organic Deposit Growth

Slide 9

Strong Trends in Operating Performance Diluted EPS and Net Income to Common Stockholders Return on Average Tangible Common Equity(2) Income and Margin Efficiency Ratio(2) & Non-interest Expense / Average Assets (1) Median consensus of 2018 analyst expectations, as of January 3, 2019. (2) Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation.

Slide 10

Tangible Common Book Value(1) Tangible Common Book Value per Share(1) and Asset Growth 2014: Repurchase 1.3MM shares Repayment of $15.54MM of FCB TARP with a bank stock loan 2015: Acquisition of FFSL IPO TCBV CAGR 2014-2018: 9.0% 2016: Paid off SBLF Restructured term bank stock loan into LOC. Completed Community First merger on Nov. 10, 2016 Announced Prairie merger on Oct. 20, 2016 Completed PIPE in Dec 2016 Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. 2017: Completed Prairie merger on March 10, 2017; Eastman & Patriot mergers on November 10, 2017 Announced mergers with First National Bank and Adams Dairy Bank on December 18, 2017 2018: Completed First National Bank & Adams Dairy Bank mergers on May 4, 2018 Completed City Bank & Trust merger on August 23, 2018 Announced pending acquisition of Guymon and Cordell, Oklahoma branches from MidFirst Bank on September 24, 2018

Slide 11

Capital Position Over Time IPO * Paid off Series C preferred stock in January 2016

Slide 12

Total Loans Total ($000s) $2,103,279 $2,542,992 $725,876 $960,355 $1,383,605 Loan Yield 5.63% 5.31% 4.98% 5.43% 5.74% *Includes Ag. Real Estate

Slide 13

Metro Market Organic Loan Growth Drivers Cumulative Metro Market Organic Loan Growth Since 12/31/2015

Slide 14

Asset Quality Nonperforming Assets 1.33% 0.89% NPAs / Assets 1.43% Net Charge-Offs (NCO)/ Average Loans $0.85 $3.50 $1.19 NCO in $ ($ in millions) Nonaccrual Detail Classified Assets to Total Regulatory Capital Classified Assets / Equity Bank Total Regulatory Capital $0.89 1.52% 0.97% $1.00 68.5% 75.9% Purchased impaired loans classified as non-accrual that are currently performing

Slide 15

Total Deposits Total ($000s) $2,382,013 $3,123,447 $981,178 $1,215,913 $1,630,451 Cost of Deposits* 0.43% 0.48% 0.56% 0.68% 0.96% * Includes interest and non-interest bearing deposits

Slide 16

Footprint & Target There are over 500 banks with deposits less than $750MM in our operating market.

Slide 17

Appendix

Slide 18

CRAIG ANDERSON Chief Operating Officer Joined Equity Bank March 2018 Served as President of UMBF Commercial Banking More than 31 years of banking experience Experienced Management Team BRAD ELLIOTT Chairman & CEO Founded Equity Bank in 2002 Served as Regional President of Sunflower Bank prior to forming Equity Bank More than 25 years of banking experience GREG KOSSOVER Chief Financial Officer Has served as CFO since 2013 and as a Board Director since 2011 Previously served as president of Physicians Development Group and CEO of Value Place, LLC, growing the latter to more than 150 locations in 25 states WENDELL BONTRAGER President, Equity Bank Previously Region President of Old National Bank (IN), EVP with Tower Bank (IN) More than 25 years of banking experience

Slide 19

Team Member Role Years with EQBK Years in Banking Patrick Harbert EVP, Community Markets, Sales & Service 14 23 Julie Huber EVP, Strategic Initiatives 14 24 Craig Mayo EVP, Chief Credit Officer 1 34 John Blakeney EVP, Chief Information Officer 1 30 Rolando Mayans EVP, Chief Risk Officer 10 25 Jennifer Johnson EVP, Chief Services Officer 6 32 Brett Reber EVP, General Counsel 1 1 Gaylyn McGregor EVP, Director of Trust and Wealth Management 1 28 Patrick Salmans SVP, Human Resources Director 6 22 Mark Parman SVP, President - Kansas City 5 37 John Hanley SVP, Director of Marketing 5 14 Jeremy Machain SVP, President – Wichita 9 15 Michael Bezanson SVP, CEO of Tulsa 1 35 Shawna Palmieri SVP, Director of Treasury Management 1 13 Barbara Noyes SVP, Controller 7 32 EQBK Team has 300+ Years of Combined Banking Experience Strategic Planning Team

Slide 20

Diverse Market Segments Source: S&P Market Intelligence. Deposit and market share data as of June 30, 2018. Employment data as of November 30, 2018. Equity Bancshares, Inc. operating market reported above includes all bank locations and counties in which Equity Bank operates, including all completed mergers subsequent to June 30, 2018, and the pending purchase and assumption of three branches from MidFirst Bank. Diverse market segments with economies based on transportation, manufacturing and healthcare Top employers in the region include a diverse range of operations such as telecommunications, professional services, aircraft manufacturing, OEM manufacturing and transportation. Equity Bancshares, including pending acquisition of three branches from MidFirst Bank, ranks in the Top 10 for market share in 22 of the 27 counties served and ranks in the Top 5 in 19 of those counties.

Slide 21

Market Data Demographics Kansas Missouri Arkansas Oklahoma National Current Population 2,921,699 6,141,815 3,023,501 3,959,630 329,236,175 Historical Population Change (2010-2019) 2.40% 2.55% 3.69% 5.55% 6.64% Median Household Income (2019) $59,745 $56,018 $47,167 $52,254 $63,174 Projected Household Income Change (2019-2024) 6.63% 8.49% 7.27% 4.92% 8.82% November 2018 Unemployment Rate 2.9% 2.5% 3.3% 2.8% 3.5% Source: S&P Market Intelligence Boeing Cargill Meat Solutions Cessna Aircraft Co. Spirit AeroSystems Inc. Blue Cross and Blue Shield of Kansas and Oklahoma Payless Shoe Source Hill’s Pet Nutrition Goodyear Tire Co. Jostens Publishing Hallmark Cards, Inc. H&R Block Honeywell Sprint Garmin Teva DST Systems Inc. Whiteman Airforce Base Stahl Specialty Co. Western Missouri Medical Center HaysMed Walmart FedEx Tyson Foods FlexSteel Wabash National Wichita St. University Pittsburg St. University Washburn University Fort Hays St. University University of Central Mo. University of Mo-KC KU – Edwards/Professional Phillips 66 Albertsons Lindsay AAON QuikTrip Williams Seaboard Foods American Century Investments, Inc. YRC Worldwide Inc. Major Employers in Equity Bank Footprint

Slide 22

Selected Income Statement Data Delivering earnings growth Selected Income Statement Data ($000s) 12/31/14 12/31/15 12/31/16 12/31/17 12/31/18 Interest income $46,794 $53,028 $61,799 $,102,693 $,161,556 Interest expense 5433 6766 9202 16691 36758 Net interest income 41361 46262 52597 86002 124798 Provision for loan losses 1200 3047 2119 2953 3961 Net interest income after provision 40161 43215 50478 83049 120837 Other income 8674 9802 10466 15440 19725 Other expenses 35645 38575 47075 67463 94387 Income before income taxes 13190 14442 13869 31026 46175 Income taxes 4203 4142 4495 10377 10350 Net income 8987 10300 9374 20649 35825 Less: dividends and discount accretion on preferred stock 708 177 1 0 0 Net income allocable to common stockholders $8,279 $10,123 $9,373 $20,649 $35,825

Slide 23

Selected Balance Sheet Data Demonstrating balance sheet strength Includes interest-bearing deposits in other banks (2) Includes Federal Reserve Bank and Federal Home Loan Bank stock Selected Balance Sheet Data ($000s) ASSETS 12/31/14 12/31/15 12/31/16 12/31/17 12/31/18 Cash and cash equivalents (1) $37,702 $62,074 $38,845 $55,691 $,197,809 Investment securities (2) 318314 452362 578093 722107 946445 Net loans 720810 958353 1382003 2111125 2566926 Other assets 97689 112938 193251 281586 350536 Total assets $1,174,515 $1,585,727 $2,192,192 $3,170,509 $4,061,716 LIABILITIES & STOCKHOLDERS' EQUITY Deposits $,981,177 $1,215,914 $1,630,451 $2,382,013 $3,123,447 Borrowings 70370 194064 293909 401652 464676 Other liabilities 5239 8516 9868 12700 17652 Total liabilities 1056786 1418494 1934228 2796365 3605775 Stockholders' Equity 117729 167233 257964 374144 455941 Total liabilities and stockholders' equity $1,174,515 $1,585,727 $2,192,192 $3,170,509 $4,061,716

Slide 24

Capitalization (1) Total common equity less goodwill and intangibles divided by shares outstanding as of period end. Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Maintaining a strong regulatory capital position Ratio 12/31/14 12/31/15 12/31/16 12/31/17 12/31/18 Leverage Ratio 9.6199999999999994E-2 9.4700000000000006E-2 0.1181 0.1033 8.5999999999999993E-2 Tier 1 Risk-Based Capital Ratio 0.13159999999999999 0.13850000000000001 0.14249999999999999 0.1217 0.1152 Total Risk-Based Capital Ratio 0.1386 0.14349999999999999 0.1467 0.12540000000000001 0.1192 Common Equity Tier 1 Capital to Risk Weighted Assets NA 0.1235 0.13339999999999999 0.11559999999999999 0.1101 Tangible Book Value per Common Share(1) $13.54 $15.97 $16.64 $17.61 $19.079999999999998

Slide 25

The subsequent tables present non-GAAP reconciliations of the following calculations: Tangible Common Equity (TCE) to Tangible Assets (TA) Ratio Tangible Book Value per Common Share Return on Average Tangible Common Equity (ROATCE) Efficiency Ratio

Slide 26

TCE to TA and Tangible Book Value per Share Non-GAAP Financial Measures (Unaudited) As of and for the years ended (Dollars in thousands, except per share data) December 31, 2018 December 31, 2017 December 31, 2016 December 31,2015 December 31,2014 December 31,2012 Total stockholders’ equity $,455,941 $,374,144 $,257,964 $,167,233 $,117,729 $,138,169 Less: preferred stock 0 0 0 16,372 16,359 31,884 Less: goodwill ,131,712 ,104,907 58,874 18,130 18,130 18,130 Less: core deposit intangibles, net 21,725 10,738 4,715 1,549 1,107 1,957 Less: mortgage servicing asset, net 11 17 23 29 0 Less: naming rights, net 1,217 1,260 0 0 0 0 Tangible common equity $,301,276 $,257,222 $,194,352 $,131,153 $82,133 $86,198 Common shares outstanding at period end (1) 15,793,095 14,605,607 11,680,308 8,211,727 6,067,511 7,431,513 Book value per common share (1) $28.869642080922077 $25.61646359511111 $22.085376515756259 $18.371409570727327 $16.707015446696349 $14.301932863469389 Tangible book value per common share (1) $19.076438152243114 $17.611181787925695 $16.639287251671785 $15.971427204046117 $13.536522636712155 $11.598983948490705 Total assets $4,061,716 $3,170,509 $2,192,192 $1,585,727 $1,174,515 $1,188,850 Less: goodwill ,131,712 ,104,907 58,874 18,130 18,130 18,130 Less: core deposit intangibles, net 21,725 10,738 4,715 1,549 1,107 1,957 Less: mortgage servicing asset, net 11 17 23 29 0 Less: naming rights, net 1,217 1,260 0 0 0 0 Tangible assets $3,907,051 $3,053,587 $2,128,580 $1,566,019 $1,155,278 $1,168,763 Tangible common equity to tangible assets 7.7110843958781192E-2 8.4236014890029326E-2 9.1305941049901806E-2 8.3749303169374067E-2 7.1093710777838756E-2 7.3751479127932701E-2 (1) Share and per share data includes Class A and Class B common stock issued and outstanding and vested RSU shares Non-GAAP Financial Measures, continued (Unaudited) As of and for the three months ended As of and for the three months ended As of and for the three months ended As of and for the years ended (Dollars in thousands, except per share data) March 31, 2017 March 31, 2017 March 31, 2016 December 31,2015 December 31,2014 December 31,2012 Total average stockholders' equity $,264,736 $,264,736 $,153,929 $,137,936 $,123,174 $,102,032 Less: average intangible assets and preferred stock 65,185 65,185 20,616 31,294 37,917 33,653 Average tangible common equity (1) (3) $,199,551 $,199,551 $,133,313 $,106,642 $85,257 $68,379 Net income allocable to common stockholders (1) 4,864 4,864 3,439 10,123 8,279 3,814 Amortization of core deposit intangible 218 218 87 275 363 192 Less: tax effect of amortization of core deposit intangible (2) -76 -76 -30 -96 -,127 -65 Adjusted net income allocable to common stockholders $5,006 $5,006 $3,496 $10,302 $8,515 $3,941 Return on average tangible common equity (ROATCE) 0.10173895951967722 0.10173895951967722 0.10547234826937482 9.6603589580090396E-2 9.98744971087418E-2 5.7634653914213428E-2 Non-interest expense $15,226 $15,226 $9,689 $38,575 $35,645 $22,900 Less: merger expenses 926 926 0 1,691 0 1,519 Less: loss on debt extinguishment 0 0 58 316 0 0 Non-interest expense, excluding merger expenses and loss on debt extinguishment $14,300 $14,300 $9,631 $36,568 $35,645 $21,381 Net interest income $19,893 $19,893 $12,758 $46,262 $41,361 $25,570 Non-interest income $3,339 $3,339 $2,697 $9,802 $8,674 $4,826 Less: net gains on sales and settlement of securities 13 13 420 756 986 3 Less: net gain on acquisition 0 0 0 682 0 0 Non-interest income, excluding net gains on sales and settlement of securities and net gain on acquisition $3,326 $3,326 $2,277 $8,364 $7,688 $4,823 Efficiency ratio 0.61587493001421245 0.61587493001421245 0.64057199866977055 0.6694248160216747 0.72672225733450224 0.70348435495015305 ____________________ (1) Share and per share data includes Class A and Class B common stock issued and outstanding (2) Tax rates used in this calculation were 35% for 2015 and 2014 and 34% for 2013, 2012, and 2011 (3) All periods disclosed were calculated using a simple average of tangible common equity

Slide 27

ROATCE and Efficiency Ratio Non-GAAP Financial Measures (Unaudited) Years Ended December 31, (Dollars in thousands, except per share data) Mar. 2018 2017 2016 2015 2014 Total stockholders’ equity $,381,487 $,374,144 $,257,964 $,167,232 $,117,729 Less: preferred stock 0 0 0 16,372 16,359 Less: goodwill ,103,412 ,104,907 58,874 18,130 18,130 Less: core deposit intangibles, net 10,355 10,738 4,715 1,549 1,107 Less: mortgage servicing asset, net 16 17 23 29 0 Less: naming rights, net 1,249 1,260 0 0 0 Tangible common equity $,266,455 $,257,222 $,194,352 $,131,152 $82,133 Common shares outstanding at period end (1) 14,621,258 14,605,607 11,680,308 8,211,727 6,067,511 Book value per common share $26.091256990335577 $25.61646359511111 $22.085376515756259 $18.371287793663868 $16.707015446696349 Tangible book value per common share $18.223808101874681 $17.611181787925695 $16.639287251671785 $15.971305426982656 $13.536522636712155 Total assets $3,176,062 $3,170,509 $2,192,192 $1,585,727 $1,174,515 Less: goodwill ,103,412 ,104,907 58,874 18,130 18,130 Less: core deposit intangibles, net 10,355 10,738 4,715 1,549 1,107 Less: mortgage servicing asset, net 16 17 23 29 0 Less: naming rights, net 1,249 1,260 0 0 0 Tangible assets $3,061,030 $3,053,587 $2,128,580 $1,566,019 $1,155,278 Tangible common equity to tangible assets 8.7047497084314751E-2 8.4236014890029326E-2 9.1305941049901806E-2 8.3748664607517537E-2 7.1093710777838756E-2 (1) Share and per share data includes Class A and Class B common stock issued and outsanding (2) Tax rates used in this calculation were 35% (3) All periods disclosed, except 2018, 2017 and 2016, were calculated using a simple average of tangible common equity Non-GAAP Financial Measures, continued (Unaudited) As of and for the years ended (Dollars in thousands, except per share data) December 31, 2018 December 31, 2017 December 31, 2016 December 31,2015 December 31,2014 Total average stockholders' equity $,420,453 $,293,798 $,168,823 $,125,808 $,123,181 Less: average intangible assets and preferred stock ,139,131 76,320 25,883 19,165 37,924 Average tangible common equity (3) $,281,322 $,217,478 $,142,940 $,106,643 $85,257 Net income allocable to common stockholders $35,825 $20,649 $9,373 $10,123 $8,279 Amortization of intangibles 2,492 1,070 419 275 363 Less: tax effect of amortization of intangibles (2) 523 375 147 96 127 Adjusted net income allocable to common stockholders $37,794 $21,344 $9,645 $10,302 $8,515 Return on average tangible common equity (ROATCE) (4) 0.13434427453238637 9.8143260467725466E-2 6.7475863998880656E-2 9.6602683720450472E-2 9.98744971087418E-2 Non-interest expense $94,387 $67,463 $47,075 $38,575 $35,645 Less: merger expenses 7,462 5,352 5,294 1,691 0 Less: loss on debt extinguishment 0 0 58 316 0 Non-interest expense, excluding merger expenses and loss on debt extinguishment $86,925 $62,111 $41,723 $36,568 $35,645 Net interest income $,124,798 $86,002 $52,597 $46,262 $41,361 Non-interest income $19,725 $15,440 $10,466 $9,802 $8,674 Less: net gains (losses) from securities transactions -9 271 479 756 986 Less: net gain on acquisition 0 0 0 682 0 Non-interest income, excluding net gains (losses) from securities transactions and net gain on acquisition $19,734 $15,169 $9,987 $8,364 $7,688 Efficiency ratio 0.60142390612459529 0.61392098526257521 0.66667199284162082 0.6694248160216747 0.72672225733450224 ____________________ (1) Share and per share data includes Class A and Class B common stock issued and outstanding and vested RSU shares (2) Tax rates used in this calculation were 21% for 2018 and 35% for previous years (3) All periods disclosed, except 2018, 2017 and 2016, were calculated using a simple average of tangible common equity (4) Annualized

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