First Interstate BancSystem, Inc. (FIBK) has reported a 5.69 percent rise in profit for the quarter ended Dec. 31, 2016. The company has earned $24.76 million, or $0.55 a share in the quarter, compared with $23.43 million, or $0.51 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $25.52 million, or $0.57 a share compared with $23.50 million or $0.52 a share, a year ago.
Revenue during the quarter grew 12.06 percent to $107.34 million from $95.79 million in the previous year period. Net interest income for the quarter rose 7.57 percent over the prior year period to $73.60 million. Non-interest income for the quarter rose 13.58 percent over the last year period to $34.82 million.
First Interstate BancSystem, Inc. has made provision of $1.08 million for loan losses during the quarter, down 67.22 percent from $3.29 million in the same period last year.
Net interest margin improved 13 basis points to 3.62 percent in the quarter from 3.49 percent in the last year period. Efficiency ratio for the quarter deteriorated to 64.18 percent from 61.27 percent in the previous year period. A rise in efficiency ratio suggests a fall in profitability.
"We delivered another quarter of strong earnings growth, as our core earnings per share increased 9.6% over the same period in the prior year," said Kevin Riley, president and chief executive officer of First Interstate BancSystem, Inc. “Our fourth quarter performance was driven by positive year-over-year trends in most of our key metrics. For the full year, our earnings per share increased more than 12% over 2015," continued Mr. Riley. "Given this strong performance and the healthy outlook for the Company, we recently announced a 9% increase to our quarterly cash dividend. This furthers adds to our long-standing record of consistently increasing our dividend and returning capital to shareholders," concluded Mr. Riley.
Liabilities outpace assets growth
Total assets stood at $9,063.90 million as on Dec. 31, 2016, up 3.85 percent compared with $8,728.20 million on Dec. 31, 2015. On the other hand, total liabilities stood at $8,081.30 million as on Dec. 31, 2016, up 3.90 percent from $7,777.70 million on Dec. 31, 2015.
Loans outpace deposit growth
Net loans stood at $5,402.33 million as on Dec. 31, 2016, up 4.51 percent compared with $5,169.38 million on Dec. 31, 2015. Deposits stood at $7,376.11 million as on Dec. 31, 2016, up 4.05 percent compared with $7,088.94 million on Dec. 31, 2015. Loans to deposits ratio was 74.27 percent for the quarter, up from 74.01 percent for the previous year quarter.
Investments stood at $2,124.47 million as on Dec. 31, 2016, up 3.25 percent or $66.96 million from year-ago. Shareholders equity stood at $982.59 million as on Dec. 31, 2016, up 3.38 percent or $32.10 million from year-ago.
Return on average assets moved up 2 basis points to 1.09 percent in the quarter from 1.07 percent in the last year period. At the same time, return on average equity increased 12 basis points to 9.95 percent in the quarter from 9.83 percent in the last year period.
Credit quality deteriorates
First Interstate BancSystem, Inc. witnessed a deterioration in credit quality during the quarter. Nonperforming assets moved up 10.68 percent or $8.36 million to $86.60 million on Dec. 31, 2016 from $78.24 million on Dec. 31, 2015. Nonperforming assets to total loans was 1.58 percent in the quarter, up from 1.49 percent in the last year period. Meanwhile, nonperforming assets to total assets was 0.96 percent in the quarter, up from 0.90 percent in the last year period. Tier-1 leverage ratio stood at 10.11 percent for the quarter, down from 10.12 percent for the previous year quarter. Average equity to average assets ratio was 10.98 percent for the quarter, up from 10.90 percent for the previous year quarter. Book value per share was $21.87 for the quarter, up 4.54 percent or $0.95 compared to $20.92 for the same period last year.
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