株探米国株
日本語 英語
エドガーで原本を確認する
false000081158900008115892023-04-262023-04-26

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):   April 26, 2023
 
First Bancorp
(Exact Name of Registrant as Specified in its Charter)
         
North Carolina   0-15572   56-1421916
(State or Other Jurisdiction   (Commission   (I.R.S. Employer
of Incorporation)   File Number)   Identification Number)
         
       300 SW Broad Street,
Southern Pines, NC     28387
(Address of Principal Executive Offices)     (Zip Code)
 
(910) 246-2500
____________________
(Registrant’s telephone number, including area code)
 
Not Applicable
___________________
(Former Name or Former Address, if changed since last report)
 
 
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. ☐
Securities registered pursuant to Section 12(b) of the Act:

Title of each class            Trading symbol            Name of each exchange on which registered:
Common Stock, No Par Value FBNC The Nasdaq Global Select Market On April 26, 2023, First Bancorp (the “Registrant” or “Company”) issued an earnings release to announce its financial results for the three month period ended March 31, 2023.
1


First Bancorp
INDEX
 
  Page
   
Item 2.02 – Results of Operations and Financial Condition
Item 9.01 – Financial Statements and Exhibits
   
Signatures
   

2


Item 2.02 - Results of Operations and Financial Condition
The earnings release contains forward-looking statements regarding the Company and includes cautionary language identifying important factors that could cause actual results to differ materially from those anticipated. The earnings release is furnished as Exhibit 99.1. Consequently, it is not deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section. Such materials may only be incorporated by reference into another filing under the Exchange Act or Securities Act of 1933 if such subsequent filing specifically references this Form 8-K.



Item 9.01 – Financial Statements and Exhibits
(d) Exhibits
Exhibit 99.1 – News Release issued on April 26, 2023


Disclosures About Forward Looking Statements
This news release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995, which statements are inherently subject to risks and uncertainties. Forward-looking statements are statements that include projections, predictions, expectations or beliefs about future events or results or otherwise are not statements of historical fact. Such statements are often characterized by the use of qualifying words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” or other statements concerning opinions or judgments of the Company and its management about future events. Factors that could influence the accuracy of such forward-looking statements include, but are not limited to, the financial success or changing strategies of the Company’s customers, the Company’s level of success in integrating acquisitions, actions of government regulators, the level of market interest rates, and general economic conditions. For additional information about the factors that could affect the matters discussed in this paragraph, see the “Risk Factors” section of the Company’s most recent annual report on Form 10-K. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update or revise forward-looking statements. The Company is also not responsible for changes made to the press release by wire services, internet services or other media.




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.
             
            First Bancorp
             
    April 26, 2023    
By:
   
/s/ Richard H. Moore
            Richard H. Moore
            Chief Executive Officer

3
EX-99.1 2 exhibit991newsreleasedated.htm EX-99.1 Document



fblogoa09a.jpg

News Release

For Immediate Release: For More Information, Contact:
April 26, 2023 Elaine Pozarycki
984-900-2457

First Bancorp Reports First Quarter Results

SOUTHERN PINES, N.C. - First Bancorp (the "Company") (NASDAQ - FBNC), the parent company of First Bank, announced today net income of $15.2 million, or $0.37 per diluted common share, for the three months ended March 31, 2023 compared to $38.4 million, or $1.08 per diluted common share for the three months ended December 31, 2022 ("linked quarter") and $34.0 million, or $0.95 per diluted common share, recorded in the first quarter of 2022.

The primary driver of the reduced earnings for the first quarter of 2023 as compared to the linked quarter and the same period last year was the charges associated with the Company's acquisition of GrandSouth Bancorporation ("GrandSouth") on January 1, 2023, including merger expenses totaling $12.2 million and a one-time loan loss provision of $12.2 million to establish an initial allowance for credit losses for acquired loans in accordance with our CECL model. Generally, comparisons for the financial periods presented are significantly impacted by the GrandSouth acquisition which contributed $1.02 billion in loans and $1.05 billion in deposits. Eight new branch offices were added throughout South Carolina with the acquisition and core processing systems were converted during the quarter.

Richard H. Moore, CEO and Chairman of the Company, stated, "During a quarter with heightened market volatility and the acquisition and conversion of GrandSouth, we nevertheless grew loans and deposits organically, improved our credit quality, and increased our liquidity position. Our focus on balance sheet management has ensured that we are optimally positioned to weather the uncertain economic environment. We continue to value the strong deposit base we have cultivated throughout our footprint over the course of our 88-year history as we welcome our newest First Bank customers in South Carolina."

First Quarter 2023 Highlights

•Loans totaled $7.8 billion at March 31, 2023, with acquired balances contributing $1.02 billion to first quarter growth; organic growth was $113.7 million for an annualized growth rate (exclusive of acquired loans) of 5.9%.
•Total deposits, exclusive of acquired balances of $1.05 billion, grew $95.2 million for the quarter, an annualized organic growth rate (exclusive of acquired deposits) of 3.7%.
•Tax equivalent net interest margin remained essentially flat with the linked quarter at 3.31% with higher loan yields and increased loan discount accretion offsetting higher cost of funds.
•Total loan yield increased to 5.22%, up 60 basis points from the linked quarter, with accretion on purchased loans contributing 21 basis points to loan yield; market rate increases and improved pricing on new loans also contributed to the higher yields.
•Total cost of funds increased to 0.94%, up 58 basis points from the linked quarter, with increases in both deposit costs and borrowing costs related to higher market rates.
1


•Liquidity ratio increased to 26.2% at March 31, 2023 and was in excess of 30% when including available off-balance sheet sources.
•Credit quality continues to be strong with decreases in nonperforming assets ("NPA") for the fifth straight quarter. The NPA to total assets ratio declined to 0.25% as of March 31, 2023 from 0.46% for the comparable period of 2022.
•Capital remains strong with a total common equity tier 1 ratio of 12.03% and a total risk-based capital ratio of 14.33% as of March 31, 2023.

Net Interest Income and Net Interest Margin

Net interest income for the first quarter of 2023 was $92.5 million, a 20.3% increase from the $76.9 million recorded in the first quarter of 2022 and a 9.6% increase from the linked quarter. The increase in net interest income from the prior year period was due in large part to higher earning assets related to both organic growth and the GrandSouth acquisition. Average interest-earning assets for the first quarter of 2023 increased 16.5% from the comparable period of the prior year, with growth primarily in loans.

Also contributing to the increase in net interest income year-over-year was the higher net interest margin ("NIM"). The Company’s tax-equivalent NIM (calculated by dividing tax-equivalent net interest income by average earning assets) for the first quarter of 2023 was 3.31% compared to 3.21% for the first quarter of 2022. The higher NIM was driven by the increase in market interest rates between periods with loan yields increasing from 4.30% for the first quarter of 2022 to 5.22% for the current period. Partially offsetting the rise in asset yields was the increase in total cost of funds which was 0.94% for the quarter ended March 31, 2023, up from 0.36% in the linked quarter and 0.10% in the same period in the prior year.

For the Three Months Ended
YIELD INFORMATION March 31, 2023 December 31, 2022 March 31, 2022
Yield on loans 5.22% 4.62% 4.30%
Yield on securities 1.78% 1.74% 1.76%
Yield on other earning assets 3.47% 3.05% 0.55%
   Yield on all interest-earning assets 4.16% 3.64% 3.27%
Rate on interest bearing deposits 1.19% 0.44% 0.12%
Rate on other interest-bearing liabilities 5.34% 4.58% 2.77%
   Rate on all interest-bearing liabilities 1.46% 0.60% 0.15%
     Total cost of funds 0.94% 0.36% 0.10%
        Net interest margin (1) 3.28% 3.29% 3.18%
        Net interest margin - tax-equivalent (2) 3.31% 3.32% 3.21%
        Average prime rate 7.69% 6.82% 3.29%
(1) Calculated by dividing annualized net interest income by average earning assets for the period.
(2) Calculated by dividing annualized tax-equivalent net interest income by average earning assets for the period. The tax-equivalent amount reflects the tax benefit that the Company receives related to its tax-exempt loans and securities, which carry interest rates lower than similar taxable investments due to their tax-exempt status. This amount has been computed assuming a 23% tax rate and is reduced by the related nondeductible portion of interest expense.

Included in interest income for the first quarter of 2023 was total loan discount accretion of $3.6 million, compared to $1.3 million for the linked quarter and $2.3 million for the first quarter of 2022. The increase in loan discount accretion was related to the GrandSouth acquisition and had a 13 basis point positive impact on the Company's NIM in the first quarter of 2023 compared to accretion contributing 5 basis points and 10 basis points, respectively, to NIM for the linked quarter and the prior year quarter.

2


The following table presents the impact to net interest income of the purchase accounting adjustments for each period.
For the Three Months Ended
NET INTEREST INCOME PURCHASE ACCOUNTING ADJUSTMENTS
($ in thousands)
March 31, 2023 December 31, 2022 March 31, 2022
Interest income - increased by accretion of loan discount on acquired loans $ 3,118  886  1,671 
Interest income - increased by accretion of loan discount on retained portions of SBA loans 448  427  667 
Total interest income impact 3,566  1,313  2,338 
Interest expense - (increased) reduced by (discount accretion) premium amortization of deposits (1,019) 70  234 
Interest expense - increased by discount accretion of borrowings (82) (64) (73)
Total net interest expense impact (1,101) 161 
     Total impact on net interest income $ 2,465  1,319  2,499 

Provision for Credit Losses and Credit Quality

For the three months ended March 31, 2023, the Company recorded $11.5 million in provision for loan losses which is compared to a provision of $3.5 million for the first quarter of 2022. The provision for the current quarter was directly related to a one-time provision of $12.2 million for non-credit deteriorated loans acquired from GrandSouth, partially offset by fluctuations in our CECL model calculation for loan balance changes and updated economic forecasts during the first quarter of 2023.

Also related to the GrandSouth acquisition, the Company recorded $1.1 million in provision for unfunded commitments during the first quarter of 2023. The reserve for unfunded commitments totaled $14.4 million at March 31, 2023 and is included in the line item "Other Liabilities".

Asset quality remained strong with annualized net loan charge-offs of 0.09% for the first quarter of 2023. Total NPAs amounted to $31.1 million at March 31, 2023, or 0.25% of total assets, down from $38.3 million at the end of the linked quarter, and $48.9 million, or 0.46% of total assets, at March 31, 2022. The decline was due in part to the Company's adoption of ASU 2022-02 which eliminated the accounting for troubled debt restructurings and replaced it with disclosures for loan modification to borrowers experiencing financial difficulty as presented in the following table.

ASSET QUALITY DATA ($ in thousands)
March 31, 2023 December 31, 2022 March 31, 2022
Nonperforming assets
Nonaccrual loans $ 28,059  28,514  33,460 
Troubled debt restructurings - accruing (1)
—  9,121  12,727 
Modifications to borrowers in financial distress 2,224  —  — 
Total nonperforming loans 30,283  37,635  46,187 
Foreclosed real estate 789  658  2,750 
Total nonperforming assets $ 31,072  38,293  48,937 
Asset Quality Ratios
Quarterly net charge-offs (recoveries) to average loans - annualized 0.09  % (0.02) % 0.01  %
Nonperforming loans to total loans 0.39  % 0.56  % 0.76  %
Nonperforming assets to total assets 0.25  % 0.36  % 0.46  %
Allowance for credit losses to total loans 1.36  % 1.36  % 1.35  %
(1) The Company implemented ASU 2022-02 effective January 1, 2023 eliminating TDR accounting.

3


Noninterest Income

Total noninterest income for the first quarter of 2023 was $13.5 million, a 29.7% decrease from the $19.3 million recorded for the first quarter of 2022 and a 7.0% decrease from the linked quarter. The primary factors driving fluctuations among the periods presented were as follows:

•Fluctuations in "Service charges on deposit accounts" between periods were driven by increases in the number of new customers and transaction accounts related to the GrandSouth acquisition, combined with continued organic growth in transaction accounts. Partially offsetting the growth as compared to the linked quarter were lower NSF charges as the Company discontinued charging consumers for this service effective February 1, 2023.
•Fluctuations in "Other service charges, commissions and fees" were related to higher volumes of activity in each period offset by lower interchange fees beginning in July 2022 as a result of the Durbin Amendment limitations becoming applicable to the Company.
•Fees from presold mortgages amounted to $0.4 million for the first quarter of 2023, a decrease of 63.8% from the $1.1 million recorded in the first quarter of 2022 and an increase of $0.3 million over the linked quarter. Mortgage loan refinancing and origination volumes continued to be low in the first quarter of 2023 in large part due to increases in mortgage interest rates since early 2022.
•SBA loan sale gains amounted to $0.3 million for the first quarter of 2023 compared to $3.3 million in the first quarter of 2022 and $0.5 million for the linked quarter. The decrease was related to slower loan originations and the lower premiums available on SBA loan sales given the current market interest rates, resulting in the Company retaining a higher percentage of originations in the first quarter of 2023.
•Other gains for both the linked quarter and the prior year quarter included death benefits realized on bank-owned life insurance policies. There were no large or unusual transactions in the first quarter of 2023 giving rise to gains or losses.

Noninterest Expenses

Noninterest expenses amounted to $74.2 million for the first quarter of 2023 compared to $45.7 million for the linked quarter and $51.5 million for the first quarter of 2022. The 62.5% increase in noninterest expenses from the linked quarter and the 44.1% increase from the prior year period were driven by merger and acquisition expenses of $12.2 million and higher intangible amortization resulting from the GrandSouth acquisition.

In addition to direct merger-related expenses, the Company realized higher salary and benefit expenses and occupancy expenses related to the eight acquired GrandSouth branch locations and related branch and support personnel. Other operating expenses increased $9.0 million for the quarter ended March 31, 2023 as compared to the linked quarter and $5.8 million from the prior year quarter. The primary factors driving increases between the periods included:
•A one-time charge of $2.4 million for the estimated termination costs associated with the Company's pension plan which we anticipate exiting during the fourth quarter of 2023.
•Accrual adjustments in the fourth quarter of 2022 of approximately $3.6 million, primarily related to reversal of expired Mastercard Rewards Points, which reduced expenses in that period thus contributing to the increase between periods.
•Increases in the first quarter of 2023 for data processing, software expense, advertising and FDIC insurance related to the GrandSouth acquisition, including the transition of new customers and integration of core processing systems.



4


Balance Sheet

Total assets at March 31, 2023 amounted to $12.4 billion, growing approximately 16% from both the linked quarter and a year earlier. The growth was driven by the acquisition of GrandSouth, combined with organic loan and deposit growth during the quarter. Quarterly average balances for key balance sheet accounts are presented below.

For the Three Months Ended
AVERAGE BALANCES
($ in thousands)
March 31, 2023 December 31, 2022 March 31, 2022 Change
1Q23 vs 1Q22
Total assets $ 12,042,298  10,579,187  10,564,419  14.0  %
Investment securities 3,321,240  3,325,652  3,283,845  1.1  %
Loans 7,728,424  6,576,415  6,051,487  27.7  %
Earning assets 11,428,789  10,161,108  9,814,193  16.5  %
Deposits 10,216,908  9,275,909  9,220,352  10.8  %
Interest-bearing liabilities 6,866,646  5,779,958  5,852,296  17.3  %
Shareholders’ equity 1,273,435  1,003,031  1,210,122  5.2  %

Total investment securities of $2.8 billion at March 31, 2023 were fairly consistent with year end and decreased $401.1 million from March 31, 2022. The decline in investment securities from the prior year was due in large part to the utilization of cash flows from amortizing investments to fund loan growth and fluctuations in deposits. The unrealized loss on available for sale securities totaled $408.7 million, representing an improvement of $35.3 million from year end related to favorable movements in market rates. The Company has the intent and ability to hold investments with unrealized losses until maturity or recovery of the amortized cost as market conditions change.

Total loans amounted to $7.8 billion at March 31, 2023, an increase of $1.7 billion, or 28.6%, from March 31, 2022, and total loan growth of $1.1 billion from year end. Exclusive of the GrandSouth acquisition, organic growth was $113.7 million for the first quarter of 2023, representing an annualized growth rate of 5.9%. Our total loan portfolio mix has remained fairly consistent and we have no notable concentrations in geographies or industries, including in office or hospitality categories.

March 31, 2023 December 31, 2022 March 31, 2022
($ in thousands) Amount % of
Total
Loans
Amount % of
Total
Loans
Amount % of
Total
Loans
Commercial and industrial $ 885,032  11  % 641,941  % 603,454  10  %
Construction, land development & other land loans 1,092,026  14  % 934,176  14  % 795,886  13  %
Residential (1-4 family) first mortgages 1,386,580  18  % 1,195,785  18  % 1,045,167  17  %
Home equity loans/lines of credit 342,287  % 323,726  % 329,348  %
Commercial real estate - owner occupied 1,200,744  16  % 1,036,270  16  % 1,007,219  17  %
Commercial real estate - non owner occupied 2,825,514  36  % 2,473,991  37  % 2,227,730  37  %
Consumer loans 68,056  % 60,659  % 56,822  %
Loans, gross 7,800,239  100  % 6,666,548  100  % 6,065,626  100  %
Unamortized net deferred loan fees (1,276) (1,403) (928)
Total loans $ 7,798,963  6,665,145  6,064,698 


Total deposits amounted to $10.4 billion at March 31, 2023, an increase of $987.5 million, or 10.5%, from March 31, 2022 and total deposit growth of $1.1 billion from year end. Exclusive of the GrandSouth acquisition, organic growth was $95.2 million for the first quarter of 2023, representing an annualized growth rate of 3.7%. The Company has a diversified and granular deposit base which has remained stable with continued growth in core deposits, primarily non-interest bearing checking accounts and money market accounts.
5


At quarter end, non-interest bearing deposits accounted for 36% of total deposits with the change from the linked quarter related to the GrandSouth acquisition. As of March 31, 2023, the estimated total insured or collateralized deposits were approximately 69%.

Our deposit mix has remained fairly consistent historically and has not significantly changed with the addition of GrandSouth as presented in the table below.

March 31, 2023 December 31, 2022 March 31, 2022
($ in thousands) Amount % of
Total
Amount % of
Total
Amount % of
Total
Noninterest-bearing checking accounts $ 3,763,637  36  % 3,566,003  39  % 3,593,642  38  %
Interest-bearing checking accounts 1,526,333  15  % 1,514,166  16  % 1,577,197  17  %
Money market accounts 3,126,571  30  % 2,416,146  26  % 2,636,913  28  %
Savings accounts 705,669  % 728,641  % 735,659  %
Other time deposits 624,444  % 464,343  % 529,347  %
Time deposits >$250,000 342,447  % 276,319  % 312,389  %
Total customer deposits 10,089,101  97  % 8,965,618  97  % 9,385,147  100  %
Brokered deposits 283,497  % 261,911  % —  —  %
Total deposits $ 10,372,598  100  % 9,227,529  100  % 9,385,147  100  %


Capital and Liquidity

The Company remains well-capitalized by all regulatory standards, with an estimated total risk-based capital ratio at March 31, 2023 of 14.33%, down from 14.99% reported at March 31, 2022. This decrease related primarily to asset growth and the GrandSouth acquisition.

The Company has elected to exclude accumulated other comprehensive income (AOCI) related primarily to available for sale securities from common equity tier 1 capital. AOCI is included in the Company’s tangible common equity to tangible assets ratio which was 6.60% at March 31, 2023, an increase of 21 basis points from the linked quarter. AOCI at March 31, 2023 improved $27.9 million compared to December 31, 2022 reflecting the reduction in unrealized loss on available for sale securities from the favorable impact of interest rate changes.

March 31, 2023 (estimated) December 31, 2022 March 31, 2022
CAPITAL RATIOS
Tangible common equity to tangible assets (non-GAAP) 6.60% 6.39% 7.17%
Common equity tier I capital ratio 12.03% 13.02% 12.85%
Tier I leverage ratio 10.28% 10.51% 9.60%
Tier I risk-based capital ratio 12.79% 13.83% 13.74%
Total risk-based capital ratio 14.33% 15.09% 14.99%

Liquidity is evaluated as both on-balance sheet (primarily cash and cash-equivalents, unpledged securities, and other marketable assets) and off-balance sheet (readily available lines of credit or other funding sources). We continue to manage our liquidity sources, including unused lines of credit, at levels we believe to be adequate to
meet our operating needs in the foreseeable future. The Company's liquidity ratio (net liquid assets as a percent of net liabilities) at March 31, 2023 was in excess of 26%. In addition, we had approximately $786 million in available lines of credit at that date resulting in a total liquidity ratio of 30.5%.


6




* * *
First Bancorp is a bank holding company headquartered in Southern Pines, North Carolina, with total assets of $12.4 billion. Its principal activity is the ownership and operation of First Bank, a state-chartered community bank that operates 118 branches in North Carolina and South Carolina. First Bank also provides SBA loans to customers through its nationwide network of lenders - for more information on First Bank’s SBA lending capabilities, please visit www.firstbanksba.com. First Bancorp’s common stock is traded on The NASDAQ Global Select Market under the symbol “FBNC.”

Please visit our website at www.LocalFirstBank.com.

Caution about Forward-Looking Statements: This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995, which statements are inherently subject to risks and uncertainties. Forward-looking statements are statements that include projections, predictions, expectations or beliefs about future events or results or otherwise are not statements of historical fact. Such statements are often characterized by the use of qualifying words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” or other words or phrases concerning opinions or judgments of the Company and its management about future events. Factors that could influence the accuracy of such forward-looking statements include, but are not limited to, the financial success or changing strategies of the Company’s customers, the Company’s level of success in integrating acquisitions, actions of government regulators, the level of market interest rates, and general economic conditions. For additional information about the factors that could affect the matters discussed in this paragraph, see the “Risk Factors” section of the Company’s most recent annual report on Form 10-K available at www.sec.gov. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update or revise forward-looking statements. The Company is also not responsible for changes made to this press release by wire services, internet services or other media.

7


First Bancorp and Subsidiaries
Financial Summary
CONSOLIDATED INCOME STATEMENT
($ in thousands, except per share data)
For the Three Months Ended
3/31/2023
(unaudited)
12/31/2022
(unaudited)
3/31/2022
(unaudited)
Interest income
   Interest and fees on loans $ 99,380  76,509  64,202 
   Interest on investment securities 14,546  14,611  14,258 
   Other interest income 3,248  1,991  649 
      Total interest income 117,174  93,111  79,109 
Interest expense
   Interest on deposits 18,918  6,145  1,771 
   Interest on borrowings 5,770  2,594  460 
      Total interest expense 24,688  8,739  2,231 
        Net interest income 92,486  84,372  76,878 
Provision for loan losses 11,451  4,000  3,500 
Provision for (reversal of) unfunded commitments 1,051  1,000  (1,500)
     Total provision for credit losses 12,502  5,000  2,000 
        Net interest income after provision for credit losses 79,984  79,372  74,878 
Noninterest income
   Service charges on deposit accounts 3,894  4,116  3,541 
   Other service charges, commissions, and fees 5,920  5,094  7,005 
   Fees from presold mortgage loans 406  151  1,121 
   Commissions from sales of insurance and financial products 1,306  1,708  945 
   SBA consulting fees 521  645  780 
   SBA loan sale gains 255  495  3,261 
   Bank-owned life insurance income 1,046  967  976 
   Other gains, net 188  1,382  1,622 
      Total noninterest income 13,536  14,558  19,251 
Noninterest expenses
   Salaries expense 29,321  24,652  23,454 
   Employee benefit expense 6,393  5,353  5,578 
   Occupancy and equipment related expense 5,067  4,433  4,688 
   Merger and acquisition expenses 12,182  303  3,484 
   Intangibles amortization expense 2,145  825  1,017 
   Foreclosed property net gains (35) —  (80)
   Other operating expenses 19,102  10,091  13,324 
      Total noninterest expenses 74,175  45,657  51,465 
Income before income taxes 19,345  48,273  42,664 
Income tax expense 4,184  9,840  8,695 
Net income $ 15,161  38,433  33,969 
Earnings per common share - diluted $ 0.37  1.08  0.95 
ADDITIONAL INCOME STATEMENT INFORMATION
   Net interest income, as reported $ 92,486  84,372  76,878 
   Tax-equivalent adjustment (1) 700  722  697 
   Net interest income, tax-equivalent $ 93,186  85,094  77,575 
(1)This amount reflects the tax benefit that the Company receives related to its tax-exempt loans and securities, which carry interest rates lower than similar taxable investments due to their tax-exempt status. This amount has been computed assuming a 23% tax rate and is reduced by the related nondeductible portion of interest expense.



8


First Bancorp and Subsidiaries
Financial Summary
CONSOLIDATED BALANCE SHEETS
($ in thousands)
At March 31, 2023
(unaudited)
At December 31, 2022
(audited)
At March 31, 2022
(unaudited)
Assets
Cash and due from banks $ 102,691  101,133  124,785 
Interest-bearing deposits with banks 610,691  169,185  440,974 
     Total cash and cash equivalents 713,382  270,318  565,759 
Investment securities 2,830,060  2,856,193  3,231,138 
Presold mortgages in process of settlement 2,951  1,282  5,672 
SBA loans held for sale 2,933  —  3,630 
Loans 7,798,963  6,665,145  6,064,698 
Allowance for credit losses on loans (106,396) (90,967) (82,069)
Net loans 7,692,567  6,574,178  5,982,629 
Premises and equipment 152,790  134,187  135,482 
Operating right-of-use lease assets 18,898  18,733  20,380 
Intangible assets 518,012  376,938  381,191 
Foreclosed properties 789  658  2,750 
Bank-owned life insurance 180,730  164,592  164,273 
Other assets 250,037  227,970  159,156 
     Total assets $ 12,363,149  10,625,049  10,652,060 
Liabilities
Deposits:
     Noninterest-bearing checking accounts 3,763,637  3,566,003  3,593,642 
     Interest-bearing deposit accounts 6,608,961  5,661,526  5,791,505 
          Total deposits 10,372,598  9,227,529  9,385,147 
Borrowings 606,481  287,507  67,415 
Operating lease liabilities 19,638  19,391  20,903 
Other liabilities 64,471  59,026  61,105 
     Total liabilities 11,063,188  9,593,453  9,534,570 
Shareholders’ equity
Common stock 959,422  725,153  723,441 
Retained earnings 654,573  648,418  559,004 
Stock in rabbi trust assumed in acquisition (1,608) (1,585) (1,814)
Rabbi trust obligation 1,608  1,585  1,814 
Accumulated other comprehensive loss (314,034) (341,975) (164,955)
     Total shareholders’ equity 1,299,961  1,031,596  1,117,490 
Total liabilities and shareholders’ equity $ 12,363,149  10,625,049  10,652,060 


9


First Bancorp and Subsidiaries
Financial Summary
For the Three Months Ended
PERFORMANCE RATIOS (annualized)
March 31, 2023 December 31, 2022 March 31, 2022
Return on average assets (1) 0.51  % 1.44  % 1.30  %
Return on average common equity (2) 4.83  % 15.20  % 11.38  %
Return on average tangible common equity (3) 8.16  % 20.96  % 16.63  %
COMMON SHARE DATA
Cash dividends declared - common $ 0.22  0.22  0.22 
Stated book value - common 31.72  28.89  31.36 
Tangible book value - common (non-GAAP) 19.08  18.34  20.66 
Common shares outstanding at end of period 40,986,990  35,704,154  35,639,889 
Weighted average shares outstanding - diluted 41,112,692  35,710,941  35,640,978 
(1) Calculated by dividing annualized net income by average assets.
(2) Calculated by dividing annualized net income by average common equity.
(3) Calculated by dividing annualized net income by average tangible common equity.



TREND INFORMATION
For the Three Months Ended
INCOME STATEMENT
($ in thousands except per share data)
March 31, 2023 December 31, 2022 September 30, 2022 June 30, 2022 March 31, 2022
Net interest income - tax-equivalent (1) $ 93,186  85,094  86,026  78,939  77,575 
Taxable equivalent adjustment (1) 700  722  692  669  697 
Net interest income 92,486  84,372  85,334  78,270  76,878 
Provision for loan losses 11,451  4,000  5,100  —  3,500 
Provision (reversal) for unfunded commitments 1,051  1,000  300  —  (1,500)
Noninterest income 13,536  14,558  16,912  17,264  19,251 
Merger and acquisition costs 12,182  303  548  737  3,484 
Other noninterest expense 61,993  45,354  48,152  48,661  47,981 
Income before income taxes 19,345  48,273  48,146  46,136  42,664 
Income tax expense 4,184  9,840  10,197  9,551  8,695 
Net income $ 15,161  38,433  37,949  36,585  33,969 
Earnings per common share - diluted 0.37  1.08  1.06  1.03  0.95 
Cash dividends declared per share 0.22  0.22  0.22  0.22  0.22 
(1) This amount reflects the tax benefit that the Company receives related to its tax-exempt loans and securities, which carry interest rates lower than similar taxable investments due to their tax-exempt status. This amount has been computed assuming a 23% tax rate and is reduced by the related nondeductible portion of interest expense.

10