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Simmons First 3Q Earnings Up 27 Percent

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Simmons First National Corp. of Pine Bluff on Thursday reported third-quarter earnings of $8.8 million, or 52 cents per share, up 27 percent from $6.9 million, or 43 cents per share, during the same quarter last year.

The publicly traded financial holding company (Nasdaq: SFNC) also reported “core earnings” of $10.7 million, up 45 percent from the same quarter last year. The company said core earnings exclude $1.9 million in net after-tax expenses.

“We are pleased with the financial results from another active quarter,” George A. Makris Jr., chairman and CEO, said in a news release. “We closed our acquisition of Delta Trust & Bank at the end of August and have our systems conversion scheduled tomorrow. We completed our legacy charter consolidation into Simmons Bank, and again reported record core earnings and record core earnings per share.”

Simmons announced the $66 million deal to acquire Delta Trust & Banking Corp. of Little Rock in March. It officially completed the purchase on Aug. 31. Since then, Delta has been operating as a subsidiary until Simmons can complete a systems conversion. Delta Trust was led by CEO French Hill, who is now running for Arkansas’ 2nd District House seat.

Simmons is working to close two other acquisitions: a $243.4 million deal to buy Community First Bancshares Inc. of Union City, Tennessee, announced in May; and a $206.9 million deal to buy Liberty Bancshares Inc. of Springfield, Missouri. Both deals are expected to close in the fourth quarter.

After those deals close, Simmons will be the second-largest financial holding company headquartered in Arkansas, with nearly $8 billion in assets.

Simmons also reported quarterly net interest income of $41.8 million, up 32 percent from the same quarter last year. The company said the increase was driven by growth in the legacy loan portfolio and earning assets acquired through Simmons’ acquisitions of Delta Trust and Metropolitan National Bank of Little Rock, which it completed in November 2013. 

Net interest margin was 4.36 percent for the quarter, a 9 basis point increase from the same quarter of 2013.

Non-interest income for the quarter was $16 million, up $5.7 million from the same quarter last year. Included in non-interest income were $900,000 in gains from the sale of branches that were closed as part the integration of Metropolitan, and $800,000 from the recovery of Metropolitan loans that were charged off before acquisition.

In line with what Makris told Arkansas Business in August, merger costs continue to show up on the company’s balance sheet. Simmons said non-interest expense for the second quarter of 2014 was $44.4 million, an increase of $13.5 million compared to the second quarter of 2013. The closing of the Delta Trust acquisition during the quarter caused merger-related costs to exceed those of last year by by $3.4 million. 

Also included in the quarter: $196,000 of charter consolidation costs from the systems conversion of the three remaining subsidiary banks that were merged into Simmons First National Bank in August.

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