Record Year for Simmons Despite Q4 Earnings Dip

Record Year for Simmons Despite Q4 Earnings Dip
(Karen E. Segrave)

Simmons First National Corp. of Pine Bluff (Nasdaq: SFNC) reported record earnings for 2021 despite a decrease in earnings in the fourth quarter.

Net income was $271.2 million for the full year, up 6% compared to 2020. The company reported $2.46 in diluted earnings per share, up 6% from the previous year. 

Results include $7.2 million in net after-tax merger related costs, gains on the sale of branches and net branch right-sizing costs. Simmons in 2021 acquired Landmark Community Bank and Triumph Bancshares, Inc., which significantly increased its presence in Tennessee.

The publicly traded company's revenue for the full year was $783.3 million.

In the fourth quarter, Simmons posted net income of $48.2 million, down from $53 million in the same quarter a year ago. Diluted earnings per share were $0.42, compared to $0.49 for the fourth quarter of 2020. The earnings matched Wall Street expectations for the quarter.

The bank holding company posted revenue of $217.3 million in the quarter. Its revenue net of interest expense was $199.7 million, surpassing Wall Street forecasts.

Simmons reported total loans of $12 billion, down from $12.9 billion a year ago. The company said in a news release that it saw high levels of liquidity throughout the system in 2021 but it's beginning to see positive signs that indicate an increase in business activity and a return to more normalized loan demand.

Newly funded loans and advances topped $2.6 billion in the fourth quarter. Unfunded commitments, considered a leading indicator of future loan growth, rose 31% during the quarter.

Simmons' commercial loan pipeline rose for the fifth consecutive quarter and more than doubled that of a year ago. Total deposits in 2021 increased to $19.4 billion, up $2.4 billion from 2020.

"We are encouraged by this positive momentum and believe that our strong capital position and outstanding deposit base well position us for another strong year in 2022," CEO George Makris said in the release.

Simmons' board of directors has authorized a new $175 million share repurchase program after substantially exhausting a prior program launched in 2019. It also approved a 6% increase in the quarterly cash dividend.

The company in November announced that it’s acquiring Spirit of Texas Bancshares Inc. of Conroe, Texas, and its wholly-owned subsidiary, Spirit of Texas Bank SSB, in a cash and stock deal valued at about $581 million. The company predicted the merger would result in combined assets of $28.2 billion, enough to push it past Arvest Bank of Fayetteville to become the largest bank chartered in Arkansas.

Simmons expects to close the deal in the second quarter of 2022. 

Simmons' principal subsidiary, Simmons Bank, operates 199 financial centers in Arkansas, Missouri, Tennessee, Texas, Oklahoma and Kansas.

The Associated Press contributed to this report. 

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