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First Internet Bancorp Reports First Quarter 2021 Results

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·21-min read
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Highlights for the first quarter include:

  • Net income of $10.5 million, an increase of 73.6% over the first quarter of 2020

  • Diluted earnings per share of $1.05, an increase of 69.4% over the first quarter of 2020

  • Total quarterly revenue of $28.9 million, an increase of 36.1% over the first quarter of 2020

  • Net interest margin and fully-taxable equivalent net interest margin increased 26 and 27 basis points ("bps"), respectively, from the fourth quarter of 2020, driven by a 17 bp decrease in the cost of interest-bearing deposits

First Internet Bancorp (the "Company") (Nasdaq: INBK), the parent company of First Internet Bank (the "Bank"), announced today financial and operational results for the first quarter of 2021. Net income for the first quarter of 2021 was $10.5 million, or $1.05 diluted earnings per share. This compares to net income of $11.1 million, or $1.12 diluted earnings per share, for the fourth quarter of 2020, and net income of $6.0 million, or $0.62 diluted earnings per share, for the first quarter of 2020.

"We produced strong earnings and solid momentum to start 2021, driven by net interest margin expansion, continued healthy production in our direct-to-consumer mortgage business and strong credit performance," said David Becker, Chairman, President and Chief Executive Officer. "Growth in net interest income combined with our strategies designed to build sustainable fee revenue paid off as we generated an average return on assets of 1.02% for the second straight quarter and increased our tangible common equity to tangible assets ratio by 43 basis points to 8.12%."

Mr. Becker concluded, "I am pleased with our first quarter financial performance and the consistently excellent work of the entire First Internet team. I want to thank all of them for their efforts in once again delivering on our goals. The high level of commitment throughout the organization remains the key to our ongoing success."

Net Interest Income and Net Interest Margin

Net interest income for the first quarter of 2021 was $20.5 million, compared to $18.9 million for the fourth quarter of 2020, and $15.0 million for the first quarter of 2020. On a fully-taxable equivalent basis, net interest income for the first quarter of 2021 was $21.9 million, compared to $20.3 million for the fourth quarter of 2020, and $16.6 million for the first quarter of 2020.

Total interest income for the first quarter of 2021 was $33.3 million, a decrease of 1.1%, compared to the fourth quarter of 2020, and a decrease of 8.2% compared to the first quarter of 2020. On a fully-taxable equivalent basis, total interest income for the first quarter of 2021 was $34.6 million, a decrease of 1.2% compared to the fourth quarter of 2020, and a decrease of 8.3% compared to the first quarter of 2020. The slight decrease in total interest income compared to the fourth quarter of 2020 was driven primarily by a decrease in day count as well as a 3.4% decrease in the average balance of interest-earning assets, which was partially offset by a 14 bp increase in the yield on those assets. The yield on interest-earning assets for the first quarter of 2021 increased to 3.31% from 3.17% in the prior quarter due primarily to changes in the earning asset mix and an increase in loan fee income, mostly related to prepayments. Average loan balances decreased $25.1 million, or 0.8%, while the average balances of securities and other earning assets decreased $34.0 million, or 5.8%, and $86.4 million, or 16.2%, respectively.

Total interest expense for the first quarter of 2021 was $12.8 million, a decrease of 13.7%, compared to the fourth quarter of 2020, and a decrease of 39.9%, compared to the first quarter of 2020. The decrease in total interest expense compared to the linked quarter was due primarily to a 17 bp decline in the cost of interest-bearing deposits as well as a decline of 4.4% in the average balance of these deposits. The decrease in deposit costs reflects the continued decline in the rates paid on interest-bearing deposits as well as a shift in the deposit mix due to a reduction in certificates and brokered deposits.

During the first quarter of 2021, the cost of money market deposits decreased by 7 bps compared to the linked quarter while the average balance of these deposits remained stable. Furthermore, the cost of certificates and brokered deposits decreased by 18 bps and average balances decreased $154.1 million, or 9.2%. During the first quarter of 2021, new certificates of deposit were originated at a weighted average cost of 40 bps while maturing deposits had a weighted average cost of 216 bps; a difference of 176 bps.

Net interest margin ("NIM") improved to 2.04% for the first quarter of 2021, up from 1.78% for the fourth quarter of 2020 and 1.50% for the first quarter of 2020. Fully-taxable equivalent NIM ("FTE NIM") increased to 2.18% for the first quarter of 2021, up from 1.91% for the fourth quarter of 2020 and 1.65% for the first quarter of 2020. The increases in NIM and FTE NIM compared to the linked quarter were driven primarily by a combination of lower interest-bearing deposit costs and higher average loan yields.

Noninterest Income

Noninterest income for the first quarter of 2021 was $8.4 million, compared to $12.7 million for the fourth quarter of 2020 and $6.2 million for the first quarter of 2020. The decrease compared to the linked quarter was driven primarily by lower revenues from mortgage banking activities and a decrease in gain on sale of loans. Mortgage banking revenue totaled $5.8 million for the first quarter of 2021, down $2.2 million from the linked quarter, due primarily to a decrease in interest rate lock volume and a decrease in margins. On a historical basis, however, mortgage banking revenue remained strong as the low interest rate environment continued to drive purchase and refinance activity. Gain on sale of loans totaled $1.7 million for the quarter, decreasing $2.0 million compared to the fourth quarter of 2020 due to a reduction in U.S. Small Business Administration ("SBA") 7(a) guaranteed loan sales in the quarter.

Noninterest Expense

Noninterest expense for the first quarter of 2021 was $15.3 million, compared to $14.5 million for the fourth quarter of 2020 and $13.5 million for the first quarter of 2020. Noninterest expense increased on a linked-quarter basis, driven primarily by a $0.4 million increase in salaries and employee benefits, a $0.2 million increase in marketing, advertising and promotion expense, and a $0.2 million increase consulting and professional fees. The increase in salaries and employee benefits expense was due mainly to higher medical claims experience, share-based compensation and seasonal resets of employee benefits and payroll taxes. The increase in marketing expenses was due to higher mortgage lead generation costs and increased digital marketing initiatives. The increase in consulting and professional fees was due to seasonally higher legal expenses generally related to year-end reporting and the preparation of proxy materials for our annual meeting of shareholders, which are customarily incurred in the first quarter. Additionally, during the first quarter of 2021, and reflected in other noninterest expense, the Company made a $250,000 contribution to a foundation that supports not-for-profit organizations and community-based initiatives in Hamilton County, IN.

Income Taxes

The Company reported income tax expense of $1.9 million for the first quarter of 2021 and an effective tax rate of 15.1%, compared to income tax expense of $3.1 million and an effective tax rate of 21.6% for the fourth quarter of 2020 and income tax expense of $0.3 million for the first quarter of 2020. The decrease in income taxes during the quarter was primarily due to a decrease in pre-tax earnings driven by a lower proportion of taxable revenue.

Loans and Credit Quality

Total loans as of March 31, 2021 were $3.1 billion, relatively consistent with December 31, 2020, and an increase of $166.6 million, or 5.8%, compared to March 31, 2020. Total commercial loan balances were $2.5 billion as of March 31, 2021, a slight increase of $4.1 million, or 0.2%, compared to December 31, 2020 and an increase of $232.3 million, or 10.2%, compared to March 31, 2020. Compared to the linked quarter, the growth in commercial loan balances was driven largely by production in public finance, construction and small business lending, which was partially offset by a decrease in healthcare finance and single tenant lease financing balances due to elevated prepayment activity.

Total consumer loan balances were $478.3 million as of March 31, 2021, a decrease of $4.0 million, or 0.8%, compared to December 31, 2020 and a decrease of $60.9 million, or 11.3%, compared to March 31, 2020. The slight decline in consumer loan balances from December 31, 2020 was due primarily to increased prepayment activity across the RV and trailer portfolios.

Total delinquencies 30 days or more past due were 0.23% of total loans as of March 31, 2021, up from 0.17% as of December 31, 2020 and down from 0.32% as of March 31, 2020. Overall credit quality remained strong as nonperforming loans to total loans was 0.46% as of March 31, 2021, compared to 0.33% as of December 31, 2020 and 0.26% as of March 31, 2020.

The allowance for loan losses as a percentage of total loans was 1.00% as of March 31, 2021, or 1.02% when excluding SBA Paycheck Protection Program ("PPP") loans, compared to 0.96% and 0.98%, respectively, as of December 31, 2020 and 0.79% as of March 31, 2020. While the balance of total loans was consistent with the prior quarter, the Company continued to make additional adjustments to qualitative factors in its allowance model as well as recorded specific reserves on two commercial relationships totaling $1.1 million in the aggregate. These items were partially offset by loan portfolio composition changes which included reductions in certain portfolios with higher reserve coverage ratios as well as growth in portfolios with lower reserve coverage ratios. In total, both the amount of the allowance for loan losses and the allowance as a percentage of total loans increased compared to December 31, 2020.

Net charge-offs of $0.1 million were recognized during the first quarter of 2021, resulting in net charge-offs to average loans of 0.02%, compared to 0.04% for the fourth quarter of 2020 and 0.06% for the first quarter of 2020. The provision for loan losses in the first quarter of 2021 was $1.3 million, compared to $2.9 million for the fourth quarter of 2020 and $1.5 million for the first quarter of 2020.

Capital

As of March 31, 2021, total shareholders’ equity was $344.6 million, an increase of $13.6 million, or 4.1%, compared to December 31, 2020, due primarily to net income earned during the quarter and a decrease in accumulated other comprehensive loss. Book value per common share increased to $35.07 as of March 31, 2021, up from $33.77 as of December 31, 2020 and $31.13 as of March 31, 2020. Tangible book value per share increased to $34.60, up from $33.29 and $30.65, each as of the same reference dates.

The following table presents the Company’s and the Bank’s regulatory and other capital ratios as of March 31, 2021.

As of March 31, 2021

Company

Bank

Total shareholders' equity to assets

8.23%

9.13%

Tangible common equity to tangible assets 1

8.12%

9.03%

Tier 1 leverage ratio 2

8.46%

9.37%

Common equity tier 1 capital ratio 2

11.81%

13.08%

Tier 1 capital ratio 2

11.81%

13.08%

Total risk-based capital ratio 2

15.18%

14.11%

1 This information represents a non-GAAP financial measure. For a discussion of non-GAAP financial measures, see the section below entitled "Non-GAAP Financial Measures."

2 Regulatory capital ratios are preliminary pending filing of the Company's and the Bank's regulatory reports.

Conference Call and Webcast

The Company will host a conference call and webcast at 12:00 p.m. Eastern Time on Thursday, April 22, 2021 to discuss its quarterly financial results. The call can be accessed via telephone at (888) 348-3664. A recorded replay can be accessed through May 22, 2021 by dialing (877) 344-7529; passcode: 10154405.

Additionally, interested parties can listen to a live webcast of the call on Company's website at www.firstinternetbancorp.com. An archived version of the webcast will be available in the same location shortly after the live call has ended.

About First Internet Bancorp

First Internet Bancorp is a bank holding company with assets of $4.2 billion as of March 31, 2021. The Company’s subsidiary, First Internet Bank, opened for business in 1999 as an industry pioneer in the branchless delivery of banking services. The Bank provides consumer and small business deposit, consumer loan, residential mortgage, and specialty finance services nationally as well as commercial real estate loans, commercial and industrial loans, SBA financing and treasury management services in select geographies. First Internet Bancorp’s common stock trades on the Nasdaq Global Select Market under the symbol "INBK" and is a component of the Russell 2000® Index. Additional information about the Company is available at www.firstinternetbancorp.com and additional information about the Bank, including its products and services, is available at www.firstib.com.

Forward-Looking Statements

This press release may contain forward-looking statements with respect to the financial condition, results of operations, trends in lending policies, plans, objectives, future performance or business of the Company. Forward-looking statements are generally identifiable by the use of words such as "anticipate," "believe," "continue," "could," "designed," "estimate," "expect," "intend," "may," "optimistic," "pending," "plan," "position," "preliminary," "remain," "should," "will," "would" or other similar expressions. Forward-looking statements are not a guarantee of future performance or results, are based on information available at the time the statements are made and involve known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the information in the forward-looking statements. The COVID-19 pandemic continues to impact general business and economic conditions, as well as our customers, counterparties, employees, and third-party service providers. Continued uncertainty in market conditions could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding, lead to a tightening of credit and further increase stock price volatility. In addition, changes to statutes, regulations, or regulatory policies or practices as a result of, or in response to COVID-19, could affect us in substantial and unpredictable ways. The ultimate magnitude and duration of the pandemic is still unknown at this time, therefore, the extent of the impact on our business, financial position, results of operations, liquidity and prospects remains uncertain. Other factors that may cause such differences include: failures or breaches of or interruptions in the communications and information systems on which we rely to conduct our business; failure of our plans to grow our commercial real estate, commercial and industrial, public finance, SBA and healthcare finance loan portfolios; competition with national, regional and community financial institutions; the loss of any key members of senior management; fluctuations in interest rates; general economic conditions; risks relating to the regulation of financial institutions; and other factors identified in reports we file with the U.S. Securities and Exchange Commission. All statements in this press release, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles ("GAAP"). Non-GAAP financial measures, specifically tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, average tangible common equity, return on average tangible common equity, total interest income – FTE, net interest income – FTE, net interest margin – FTE and allowance for loan losses to loans, excluding PPP loans are used by the Company’s management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders. Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the table at the end of this release under the caption "Reconciliation of Non-GAAP Financial Measures."

First Internet Bancorp

Summary Financial Information (unaudited)

Dollar amounts in thousands, except per share data

Three Months Ended

March 31,

December 31,

March 31,

2021

2020

2020

Net income

$

10,450

$

11,090

$

6,019

Per share and share information

Earnings per share - basic

$

1.06

$

1.12

$

0.62

Earnings per share - diluted

1.05

1.12

0.62

Dividends declared per share

0.06

0.06

0.06

Book value per common share

35.07

33.77

31.13

Tangible book value per common share 1

34.60

33.29

30.65

Common shares outstanding

9,823,831

9,800,569

9,801,825

Average common shares outstanding:

Basic

9,899,230

9,883,609

9,721,485

Diluted

9,963,036

9,914,022

9,750,528

Performance ratios

Return on average assets

1.02

%

1.02

%

0.59

%

Return on average shareholders' equity

12.61

%

13.64

%

7.78

%

Return on average tangible common equity 1

12.79

%

13.84

%

7.90

%

Net interest margin

2.04

%

1.78

%

1.50

%

Net interest margin - FTE 1,2

2.18

%

1.91

%

1.65

%

Capital ratios 3

Total shareholders' equity to assets

8.23

%

7.79

%

7.32

%

Tangible common equity to tangible assets 1

8.12

%

7.69

%

7.22

%

Tier 1 leverage ratio

8.46

%

7.95

%

7.82

%

Common equity tier 1 capital ratio

11.81

%

11.31

%

10.76

%

Tier 1 capital ratio

11.81

%

11.31

%

10.76

%

Total risk-based capital ratio

15.18

%

14.91

%

13.87

%

Asset quality

Nonperforming loans

$

14,048

$

10,183

$

7,443

Nonperforming assets

14,077

10,218

9,622

Nonperforming loans to loans

0.46

%

0.33

%

0.26

%

Nonperforming assets to total assets

0.34

%

0.24

%

0.23

%

Allowance for loan losses to:

Loans

1.00

%

0.96

%

0.79

%

Loans, excluding PPP loans 1

1.02

%

0.98

%

0.79

%

Nonperforming loans

218.1

%

289.5

%

307.1

%

Net charge-offs to average loans

0.02

%

0.04

%

0.06

%

Average balance sheet information

Loans

$

3,047,915

$

3,070,476

$

2,931,108

Total securities

548,429

582,425

630,879

Other earning assets

446,045

532,466

415,927

Total interest-earning assets

4,073,604

4,219,142

4,024,800

Total assets

4,173,273

4,316,207

4,099,932

Noninterest-bearing deposits

90,764

86,836

60,456

Interest-bearing deposits

3,115,987

3,258,269

3,089,045

Total deposits

3,206,751

3,345,105

3,149,501

Shareholders' equity

335,968

323,464

311,005

1 Refer to "Non-GAAP Financial Measures" section above and "Reconciliation of Non-GAAP Financial Measures" below

2 On a fully-taxable equivalent ("FTE") basis assuming a 21% tax rate

3 Regulatory capital ratios are preliminary pending filing of the Company's regulatory reports

First Internet Bancorp

Condensed Consolidated Balance Sheets (unaudited, except for December 31, 2020)

Dollar amounts in thousands

March 31,

December 31,

March 31,

2021

2020

2020

Assets

Cash and due from banks

$

4,440

$

7,367

$

5,726

Interest-bearing deposits

411,765

412,439

345,542

Securities available-for-sale, at fair value

462,376

497,628

608,682

Securities held-to-maturity, at amortized cost

68,190

68,223

66,331

Loans held-for-sale

30,235

39,584

52,394

Loans

3,058,694

3,059,231

2,892,093

Allowance for loan losses

(30,642

)

(29,484

)

(22,857

)

Net loans

3,028,052

3,029,747

2,869,236

Accrued interest receivable

16,433

17,416

16,960

Federal Home Loan Bank of Indianapolis stock

25,650

25,650

25,650

Cash surrender value of bank-owned life insurance

38,185

37,952

37,238

Premises and equipment, net

42,381

37,590

18,883

Goodwill

4,687

4,687

4,687

Servicing asset

3,817

3,569

2,415

Other real estate owned

-

-

2,065

Accrued income and other assets

52,359

64,304

112,337

Total assets

$

4,188,570

$

4,246,156

$

4,168,146

Liabilities

Noninterest-bearing deposits

$

100,700

$

96,753

$

70,562

Interest-bearing deposits

3,116,903

3,174,132

3,107,944

Total deposits

3,217,603

3,270,885

3,178,506

Advances from Federal Home Loan Bank

514,917

514,916

514,911

Subordinated debt

69,794

79,603

69,605

Accrued interest payable

1,418

1,439

3,293

Accrued expenses and other liabilities

40,272

48,369

96,704

Total liabilities

3,844,004

3,915,212

3,863,019

Shareholders' equity

Voting common stock

221,911

221,408

219,893

Retained earnings

136,575

126,732

105,100

Accumulated other comprehensive loss

(13,920

)

(17,196

)

(19,866

)

Total shareholders' equity

344,566

330,944

305,127

Total liabilities and shareholders' equity

$

4,188,570

$

4,246,156

$

4,168,146

First Internet Bancorp

Condensed Consolidated Statements of Income (unaudited)

Dollar amounts in thousands, except per share data

Three Months Ended

March 31,

December 31,

March 31,

2021

2020

2020

Interest income

Loans

$

30,885

$

30,930

$

30,408

Securities - taxable

1,779

1,988

3,619

Securities - non-taxable

281

318

572

Other earning assets

335

407

1,645

Total interest income

33,280

33,643

36,244

Interest expense

Deposits

8,628

10,577

17,208

Other borrowed funds

4,127

4,201

4,018

Total interest expense

12,755

14,778

21,226

Net interest income

20,525

18,865

15,018

Provision for loan losses

1,276

2,864

1,461

Net interest income after provision

for loan losses

19,249

16,001

13,557

Noninterest income

Service charges and fees

266

206

212

Loan servicing revenue

422

379

251

Loan servicing asset revaluation

(155

)

(60

)

(179

)

Mortgage banking activities

5,750

7,987

3,668

Gain on sale of loans

1,723

3,702

1,801

Gain (loss) on sale of securities

-

-

41

Other

369

443

417

Total noninterest income

8,375

12,657

6,211

Noninterest expense

Salaries and employee benefits

9,492

9,135

7,774

Marketing, advertising and promotion

680

443

375

Consulting and professional fees

986

788

1,177

Data processing

462

426

375

Loan expenses

534

630

599

Premises and equipment

1,601

1,601

1,625

Deposit insurance premium

425

450

485

Other

1,137

1,040

1,076

Total noninterest expense

15,317

14,513

13,486

Income before income taxes

12,307

14,145

6,282

Income tax provision

1,857

3,055

263

Net income

$

10,450

$

11,090

$

6,019

Per common share data

Earnings per share - basic

$

1.06

$

1.12

$

0.62

Earnings per share - diluted

$

1.05

$

1.12

$

0.62

Dividends declared per share

$

0.06

$

0.06

$

0.06

All periods presented have been reclassified to conform to the current period classification.

First Internet Bancorp

Average Balances and Rates (unaudited)

Dollar amounts in thousands

Three Months Ended

March 31, 2021

December 31, 2020

March 31, 2020

Average

Interest /

Yield /

Average

Interest /

Yield /

Average

Interest /

Yield /

Balance

Dividends

Cost

Balance

Dividends

Cost

Balance

Dividends

Cost

Assets

Interest-earning assets

Loans, including loans held-for-sale 1

$

3,079,130

$

30,885

4.07

%

$

3,104,251

$

30,930

3.96

%

$

2,977,994

$

30,408

4.11

%

Securities - taxable

461,300

1,779

1.56

%

492,573

1,988

1.61

%

531,046

$

3,619

2.74

%

Securities - non-taxable

87,129

281

1.31

%

...

89,852

318

1.41

%

99,833

$

572

2.30

%

Other earning assets

446,045

335

0.30

%

532,466

407

0.30

%

415,927

$

1,645

1.59

%

Total interest-earning assets

4,073,604

33,280

3.31

%

4,219,142

33,643

3.17

%

4,024,800

36,244

3.62

%

Allowance for loan losses

(29,884

)

(27,805

)

(22,059

)

Noninterest-earning assets

129,553

124,870

97,191

Total assets

$

4,173,273

$

4,316,207

$

4,099,932

Liabilities

Interest-bearing liabilities

Interest-bearing demand deposits

$

180,746

$

133

0.30

%

$

165,815

$

156

0.37

%

$

122,925

$

219

0.72

%

Savings accounts

46,035

40

0.35

%

49,209

54

0.44

%

30,345

78

1.03

%

Money market accounts

1,369,626

1,391

0.41

%

1,369,543

1,655

0.48

%

866,605

3,743

1.74

%

Certificates and brokered deposits

1,519,580

7,064

1.89

%

1,673,702

8,712

2.07

%

2,069,170

13,168

2.56

%

Total interest-bearing deposits

3,115,987

8,628

1.12

%

3,258,269

10,577

1.29

%

3,089,045

17,208

2.24

%

Other borrowed funds

583,780

4,127

2.87

%

591,806

4,201

2.82

%

584,465

4,018

2.76

%

Total interest-bearing liabilities

3,699,767

12,755

1.40

%

3,850,075

14,778

1.53

%

3,673,510

21,226

2.32

%

Noninterest-bearing deposits

90,764

86,836

60,456

Other noninterest-bearing liabilities

46,774

55,832

54,961

Total liabilities

3,837,305

3,992,743

3,788,927

Shareholders' equity

335,968

323,464

311,005

Total liabilities and shareholders' equity

$

4,173,273

$

4,316,207

$

4,099,932

Net interest income

$

20,525

$

18,865

$

15,018

Interest rate spread

1.91

%

1.64

%

1.30

%

Net interest margin

2.04

%

1.78

%

1.50

%

Net interest margin - FTE 2,3

2.18

%

1.91

%

1.65

%

1 Includes nonaccrual loans

2 On a fully-taxable equivalent ("FTE") basis assuming a 21% tax rate

3 Refer to "Non-GAAP Financial Measures" section above and "Reconciliation of Non-GAAP Financial Measures" below

First Internet Bancorp

Loans and Deposits (unaudited)

Dollar amounts in thousands

March 21, 2021

December 31, 2020

March 21, 2020

Amount

Percent

Amount

Percent

Amount

Percent

Commercial loans

Commercial and industrial

$

71,835

2.3

%

$

75,387

2.5

%

$

95,227

3.3

%

Owner-occupied commercial real estate

87,930

2.9

%

89,785

2.9

%

74,737

2.6

%

Investor commercial real estate

14,832

0.5

%

13,902

0.5

%

13,421

0.5

%

Construction

123,483

4.0

%

110,385

3.6

%

64,581

2.2

%

Single tenant lease financing

941,322

30.8

%

950,172

31.1

%

972,275

33.6

%

Public finance

637,600

20.8

%

622,257

20.3

%

627,678

21.7

%

Healthcare finance

510,237

16.8

%

528,154

17.3

%

372,266

12.9

%

Small business lending

132,490

4.3

%

125,589

4.1

%

67,275

2.3

%

Total commercial loans

2,519,729

82.4

%

2,515,631

82.3

%

2,287,460

79.1

%

Consumer loans

Residential mortgage

190,148

6.2

%

186,787

6.1

%

218,730

7.6

%

Home equity

17,949

0.6

%

19,857

0.6

%

23,855

0.8

%

Trailers

143,454

4.7

%

144,493

4.7

%

148,700

5.1

%

Recreational vehicles

92,221

3.0

%

94,405

3.1

%

103,868

3.6

%

Other consumer loans

34,534

1.1

%

36,794

1.2

%

44,037

1.5

%

Total consumer loans

478,306

15.6

%

482,336

15.7

%

539,190

18.6

%

Net deferred loan fees, premiums, discounts and other 1

60,659

2.0

%

61,264

2.0

%

65,443

2.3

%

Total loans

$

3,058,694

100.0

%

$

3,059,231

100.0

%

$

2,892,093

100.0

%

March 21, 2021

December 31, 2020

March 21, 2020

Amount

Percent

Amount

Percent

Amount

Percent

Deposits

Noninterest-bearing deposits

$

100,700

3.1

%

$

96,753

3.0

%

$

70,562

2.2

%

Interest-bearing demand deposits

186,015

5.8

%

188,645

5.8

%

123,233

3.9

%

Savings accounts

51,251

1.6

%

43,200

1.3

%

32,485

1.0

%

Money market accounts

1,397,449

43.4

%

1,350,566

41.3

%

930,698

29.3

%

Certificates of deposits

1,174,764

36.5

%

1,289,319

39.4

%

1,493,644

47.0

%

Brokered deposits

307,424

9.6

%

302,402

9.2

%

527,884

16.6

%

-

-

-

Total deposits

$

3,217,603

100.0

%

$

3,270,885

100.0

%

$

3,178,506

100.0

%

1 Includes carrying value adjustments of $41.6 million and $42.7 million related to terminated interest rate swaps associated with public finance loans as of March 31, 2021 and December 31, 2020, respectively, and $44.6 million as of March 31, 2020 related to interest rate swaps associated with public finance loans.

First Internet Bancorp

Reconciliation of Non-GAAP Financial Measures

Dollar amounts in thousands, except per share data

Three Months Ended

March 31,

December 31,

March 31,

2021

2020

2020

Total equity - GAAP

$

344,566

$

330,944

$

305,127

Adjustments:

Goodwill

(4,687

)

(4,687

)

(4,687

)

Tangible common equity

$

339,879

$

326,257

$

300,440

Total assets - GAAP

$

4,188,570

$

4,246,156

$

4,168,146

Adjustments:

Goodwill

(4,687

)

(4,687

)

(4,687

)

Tangible assets

$

4,183,883

$

4,241,469

$

4,163,459

Common shares outstanding

9,823,831

9,800,569

9,801,825

Book value per common share

$

35.07

$

33.77

$

31.13

Effect of goodwill

(0.47

)

(0.48

)

(0.48

)

Tangible book value per common share

$

34.60

$

33.29

$

30.65

Total shareholders' equity to assets

8.23

%

7.79

%

7.32

%

Effect of goodwill

(0.11

%)

(0.10

%)

(0.10

%)

Tangible common equity to tangible assets

8.12

%

7.69

%

7.22

%

Total average equity - GAAP

$

335,968

$

323,464

$

311,005

Adjustments:

Average goodwill

(4,687

)

(4,687

)

(4,687

)

Average tangible common equity

$

331,281

$

318,777

$

306,318

Return on average shareholders' equity

12.61

%

13.64

%

7.78

%

Effect of goodwill

0.18

%

0.20

%

0.12

%

Return on average tangible common equity

12.79

%

13.84

%

7.90

%

Total interest income

$

33,280

$

33,643

$

36,244

Adjustments:

Fully-taxable equivalent adjustments 1

1,356

1,400

1,535

Total interest income - FTE

$

34,636

$

35,043

$

37,779

Net interest income

$

20,525

$

18,865

$

15,018

Adjustments:

Fully-taxable equivalent adjustments 1

1,356

1,400

1,535

Net interest income - FTE

$

21,881

$

20,265

$

16,553

Net interest margin

2.04

%

1.78

%

1.50

%

Effect of fully-taxable equivalent adjustments 1

0.14

%

0.13

%

0.15

%

Net interest margin - FTE

2.18

%

1.91

%

1.65

%

Allowance for loan losses

$

30,642

$

29,484

$

22,857

Loans

$

3,058,694

$

3,059,231

$

2,892,093

Adjustments:

PPP loans

(53,365

)

(50,554

)

-

Loans, excluding PPP loans

$

3,005,329

$

3,008,677

$

2,892,093

Allowance for loan losses to loans

1.00

%

0.96

%

0.79

%

Effect of PPP loans

0.02

%

0.02

%

0.00

%

Allowance for loan losses to loans, excluding PPP loans

1.02

%

0.98

%

0.79

%

1 Assuming a 21% tax rate

View source version on businesswire.com: https://www.businesswire.com/news/home/20210421006033/en/

Contacts

Investors/Analysts
Paula Deemer
Director of Corporate Administration
(317) 428-4628
investors@firstib.com

Media
Nicole Lorch
Executive Vice President & Chief Operating Officer
(317) 532-7906
nlorch@firstib.com