10-QPeriod: Q3 FY2019

FIRST CITIZENS BANCSHARES INC /DE/ Quarterly Report for Q3 Ended Sep 30, 2019

Filed November 5, 2019For Securities:FCNCAFCNCPFCNCBFCNCOFCNCN

Summary

First Citizens BancShares, Inc. (FCNCA) reported strong financial results for the nine months ended September 30, 2019, demonstrating significant growth in net income and net interest income compared to the same period in 2018. Net income rose by 14.4% to $355.5 million, with earnings per share increasing by 21.6% to $31.50. This performance was driven by a 10.8% increase in net interest income to $984.2 million, supported by a growing loan portfolio and a stable net interest margin. The company also saw substantial growth in both total loans and total deposits, reflecting successful organic growth and the integration of recent acquisitions. The company actively pursued strategic growth through several acquisitions completed in 2019, including First South Bancorp and Biscayne Bancshares, with additional acquisitions, Entegra Financial Corp. and Community Financial Holding Co. Inc., pending regulatory approval. These initiatives, combined with a focus on operational efficiency and customer-centric banking principles, position FCNCA for continued expansion. Despite a slight increase in nonperforming assets, the company's capital ratios remain well above regulatory requirements, indicating a strong financial position.

Financial Highlights

33 data points
Beta

Net Income

$124.78M

EPS (Diluted)

$11.27

Total Assets

$37.75B

Cash & Equivalents

$288.93M

Free Cash Flow

$145.05M

Financial Statements
Beta
Interest Expense$25.89M
Net Income$124.78M
EPS (Basic)$11.27
Shares Outstanding (Basic)11.06M

Key Highlights

  • 1Net income increased by 14.4% year-over-year to $355.5 million for the first nine months of 2019.
  • 2Earnings per share grew by 21.6% to $31.50 for the same period.
  • 3Net interest income increased by 10.8% to $984.2 million, driven by loan growth and a widening net interest margin (3.83% vs. 3.65%).
  • 4Total loans grew by 9.5% to $27.2 billion, with a significant portion attributed to acquisitions and organic growth.
  • 5Total deposits increased by 9.0% to $32.7 billion, also bolstered by acquisitions and organic growth.
  • 6The company actively pursued strategic growth through four announced or completed mergers/acquisitions in 2019.
  • 7Capital ratios remained strong, well exceeding regulatory minimums.

Frequently Asked Questions

First Citizens BancShares (FCNCA) demonstrated strong financial performance in the first nine months of 2019, with significant year-over-year increases in net income (14.4%) and earnings per share (21.6%). This growth was primarily driven by an increase in net interest income (10.8%) and a healthy expansion of both the loan and deposit portfolios.

Total loans grew by 9.5% to $27.2 billion, and total deposits increased by 9.0% to $32.7 billion. This growth was a result of both successful organic expansion and the successful integration of several acquisitions completed or announced during 2019, such as First South Bancorp and Biscayne Bancshares.

FCNCA's growth strategy focuses on organic expansion and strategic acquisitions. The company completed mergers with First South Bancorp and Biscayne Bancshares in 2019 and entered into definitive agreements for Entegra Financial Corp. and Community Financial Holding Co. Inc. These acquisitions are aimed at expanding market presence and achieving synergies.

While there was a slight increase in nonperforming assets to $155.9 million at September 30, 2019, the company states that the credit quality remains in line with risk tolerances. The allowance for loan and lease losses was $226.8 million, representing 0.83% of total loans and leases, and capital ratios remain robust, indicating a strong financial position to manage potential credit risks.