Triumph Bancorp Reports Fourth Quarter Net Income to Common Stockholders of $18.1 Million

Company Release - 1/22/2019 4:07 PM ET

DALLAS, Jan. 22, 2019 (GLOBE NEWSWIRE) -- Triumph Bancorp, Inc. (Nasdaq: TBK) (“Triumph”) today announced earnings and operating results for the fourth quarter of 2018.

As part of how we measure our results, we use certain non-GAAP financial measures to ascertain performance.  These non-GAAP financial measures are reconciled in the section labeled “Metrics and non-GAAP financial reconciliation” at the end of this press release.

2018 Fourth Quarter Highlights and Recent Developments

  • For the fourth quarter of 2018, net income available to common stockholders was $18.1 million. Diluted earnings per share were $0.67. 
      
  • Net interest margin (“NIM”) was 6.34% for the quarter ended December 31, 2018. 
      
  • Total loans held for investment increased $96.5 million, or 2.7%, to $3.609 billion at December 31, 2018. Average loans for the quarter increased $238.8 million, or 7.2%, to $3.532 billion.
      
  • Triumph Business Capital grew period-end clients to 6,191 clients which is an increase of 259 clients, or 4.4%. The total dollar value of invoices purchased for the quarter ended December 31, 2018 was $1.541 billion with an average invoice price of $1,747.
       
  • At December 31, 2018, there were 113 clients utilizing the TriumphPay platform. For the quarter ended December 31, 2018, TriumphPay processed 83,326 invoices paying 19,274 distinct carriers a total of $123.1 million.

Balance Sheet

Total loans held for investment were $3.609 billion at December 31, 2018. Our commercial finance loans, which comprise 35% of the loan portfolio, were $1.256 billion at December 31, 2018, compared to $1.284 billion at September 30, 2018, a decrease of $27.3 million, or 2.1% in the fourth quarter of 2018. The decrease in commercial finance was primarily a result of our efforts to decrease the overall risk profile of our asset based lending portfolio.

Total deposits were $3.450 billion at December 31, 2018, an increase of $11.3 million or 0.3% in the fourth quarter of 2018.  Non-interest-bearing deposits accounted for 21% of total deposits and non-time deposits accounted for 62% of total deposits at December 31, 2018. 

On October 26, 2018, our preferred shareholders converted all remaining preferred stock to 670,236 shares of common stock.

Net Interest Income

We earned net interest income for the quarter ended December 31, 2018 of $64.9 million compared to $61.8 million for the quarter ended September 30, 2018.

Yields on loans for the quarter ended December 31, 2018 were down 19 bps from the prior quarter to 8.14%. The average cost of our total deposits was 0.91% for the quarter ended December 31, 2018 compared to 0.85% for the quarter ended September 30, 2018, on an annualized basis. 

Asset Quality

Non-performing assets decreased 9 bps from September 30, 2018 to 0.84% of total assets at December 31, 2018.  The ratio of past due to total loans increased to 2.41% at December 31, 2018 from 2.23% at September 30, 2018. We recorded total net charge-offs of $1.6 million, or 0.05% of average loans, for the quarter ended December 31, 2018 compared to net charge-offs of $4.1 million, or 0.12% of average loans, for the quarter ended September 30, 2018. 

We recorded a provision for loan losses of $1.9 million for the quarter ended December 31, 2018 compared to a provision of $6.8 million for the quarter ended September 30, 2018. From September 30, 2018 to December 31, 2018, our ALLL increased from $27.3 million or 0.78% of total loans to $27.6 million or 0.76% of total loans. 

Non-Interest Income and Expense

We earned non-interest income for the quarter ended December 31, 2018 of $6.8 million compared to $6.1 million for the quarter ended September 30, 2018.

For the quarter ended December 31, 2018, non-interest expense totaled $47.0 million, compared to $48.9 million for the quarter ended September 30, 2018. Non-interest expense for the quarter ended September 30, 2018 included transaction costs related to the First Bancorp of Durango, Inc. and Southern Colorado Corp. acquisitions of $5.9 million.

Conference Call Information

Aaron P. Graft, Vice Chairman and CEO and Bryce Fowler, CFO will review the quarterly results in a conference call for investors and analysts beginning at 7:00 a.m. Central Time on Wednesday, January 23, 2019. Dan Karas, Chief Lending Officer, will also be available for questions.

To participate in the live conference call, please dial 1-855-940-9472 (Canada: 1-855-669-9657) and request to be joined into the Triumph Bancorp, Inc. call.  A simultaneous audio-only webcast may be accessed via the Company's website at www.triumphbancorp.com through the Investor Relations, News & Events, Webcasts and Presentations links, or through a direct link here at: https://services.choruscall.com/links/tbk190123.html. An archive of this conference call will subsequently be available at this same location on the Company’s website.  

About Triumph

Triumph Bancorp, Inc. (Nasdaq: TBK) is a financial holding company headquartered in Dallas, Texas.  Triumph offers a diversified line of community banking and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com

Forward-Looking Statements

This press release contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; risks related to the integration of acquired businesses (including our acquisitions of First Bancorp of Durango, Inc., Southern Colorado Corp., the operating assets of Interstate Capital Corporation and certain of its affiliates, Valley Bancorp, Inc., and nine branches from Independent Bank in Colorado) and any future acquisitions; changes in management personnel; interest rate risk; concentration of our factoring services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets, or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally, or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities, and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of the Federal Deposit Insurance Corporation insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 13, 2018.

Non-GAAP Financial Measures

This press release includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided at the end of this press release.

The following table sets forth key metrics used by Triumph to monitor its operations. Footnotes in this table can be found in our definitions of non-GAAP financial measures at the end of this document.

  As of and for the Three Months Ended  As of and for the Years Ended 
(Dollars in  December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31, 
thousands) 2018  2018  2018  2018  2017  2018  2017 
Financial Highlights:                            
Total assets $4,559,779  $4,537,102  $3,794,631  $3,405,010  $3,499,033  $4,559,779  $3,499,033 
Loans held for investment $3,608,644  $3,512,143  $3,196,462  $2,873,985  $2,810,856  $3,608,644  $2,810,856 
Deposits $3,450,349  $3,439,049  $2,624,942  $2,533,498  $2,621,348  $3,450,349  $2,621,348 
Net income available to common stockholders $18,085  $8,975  $12,192  $11,878  $6,111  $51,130  $35,446 
                             
Performance Ratios - Annualized:                            
Return on average assets  1.60%  0.90%  1.37%  1.43%  0.79%  1.33%  1.27%
Return on average total equity  11.35%  5.88%  8.53%  12.20%  6.35%  9.24%  10.66%
Return on average common equity  11.40%  5.85%  8.54%  12.30%  6.30%  9.27%  10.73%
Return on average tangible common equity (1)  16.73%  7.57%  9.95%  14.75%  7.33%  11.90%  12.50%
Yield on loans(2)  8.14%  8.33%  8.09%  7.65%  7.73%  8.07%  7.55%
Cost of interest bearing deposits  1.15%  1.08%  0.93%  0.86%  0.84%  1.02%  0.78%
Cost of total deposits  0.91%  0.85%  0.73%  0.68%  0.67%  0.80%  0.62%
Cost of total funds  1.14%  1.16%  1.06%  0.95%  0.92%  1.09%  0.86%
Net interest margin(2)  6.34%  6.59%  6.36%  6.06%  6.16%  6.35%  5.92%
Net non-interest expense to average assets  3.55%  4.19%  3.59%  3.43%  3.65%  3.70%  2.92%
Adjusted net non-interest expense to average assets (1)  3.55%  3.62%  3.47%  3.56%  3.43%  3.55%  3.41%
Efficiency ratio  65.52%  72.15%  64.26%  65.09%  66.74%  66.94%  62.96%
Adjusted efficiency ratio (1)  65.52%  63.49%  62.38%  66.45%  63.35%  64.43%  66.55%
                             
Asset Quality:(3)                            
Past due to total loans  2.41%  2.23%  2.54%  2.41%  2.33%  2.41%  2.33%
Non-performing loans to total loans  1.00%  1.13%  1.43%  1.41%  1.38%  1.00%  1.38%
Non-performing assets to total assets  0.84%  0.93%  1.28%  1.47%  1.39%  0.84%  1.39%
ALLL to non-performing loans  76.47%  68.82%  53.57%  49.52%  48.41%  76.47%  48.41%
ALLL to total loans  0.76%  0.78%  0.77%  0.70%  0.67%  0.76%  0.67%
Net charge-offs to average loans  0.05%  0.12%  0.01%  0.05%  0.06%  0.23%  0.28%
                             
Capital:                            
Tier 1 capital to average assets(4)  11.08%  11.75%  15.00%  11.23%  11.80%  11.08%  11.80%
Tier 1 capital to risk-weighted assets(4)  11.53%  11.16%  14.68%  11.54%  11.15%  11.53%  11.15%
Common equity tier 1 capital to risk-weighted assets(4)  10.58%  9.96%  13.32%  10.05%  9.70%  10.58%  9.70%
Total capital to risk-weighted assets(4)  13.40%  13.05%  16.73%  13.66%  13.21%  13.40%  13.21%
Total equity to total assets  13.96%  13.59%  16.00%  11.83%  11.19%  13.96%  11.19%
Tangible common stockholders' equity to tangible assets(1)  10.03%  9.35%  13.05%  9.86%  9.26%  10.03%  9.26%
                             
Per Share Amounts:                            
Book value per share $23.62  $23.10  $22.76  $18.89  $18.35  $23.62  $18.35 
Tangible book value per share (1) $16.22  $15.42  $18.27  $15.82  $15.29  $16.22  $15.29 
Basic earnings per common share $0.68  $0.34  $0.48  $0.57  $0.29  $2.06  $1.85 
Diluted earnings per common share $0.67  $0.34  $0.47  $0.56  $0.29  $2.03  $1.81 
Adjusted diluted earnings per common share(1) $0.67  $0.51  $0.50  $0.52  $0.34  $2.21  $1.37 
Shares outstanding end of period  26,949,936   26,279,761   26,260,785   20,824,509   20,820,445   26,949,936   20,820,445 
                             

Unaudited consolidated balance sheet as of:

  December 31,  September 30,  June 30,  March 31,  December 31, 
 (Dollars in thousands) 2018  2018  2018  2018  2017 
ASSETS                    
Total cash and cash equivalents $234,939  $282,409  $133,365  $106,046  $134,129 
Securities - available for sale  336,423   355,981   183,184   192,916   250,603 
Securities - held to maturity  8,487   8,403   8,673   8,614   8,557 
Equity securities  5,044   4,981   5,025   4,925   5,006 
Loans held for sale  2,106   683          
Loans held for investment  3,608,644   3,512,143   3,196,462   2,873,985   2,810,856 
Allowance for loan and lease losses  (27,571)  (27,256)  (24,547)  (20,022)  (18,748)
Loans, net  3,581,073   3,484,887   3,171,915   2,853,963   2,792,108 
Assets held for sale              71,362 
FHLB stock  15,943   23,109   19,223   16,508   16,006 
Premises and equipment, net  83,392   82,935   68,313   62,826   62,861 
Other real estate owned ("OREO"), net  2,060   2,442   2,528   9,186   9,191 
Goodwill and intangible assets, net  199,417   201,842   117,777   63,923   63,778 
Bank-owned life insurance  40,509   40,339   40,168   44,534   44,364 
Deferred tax asset, net  8,438   8,137   8,810   8,849   8,959 
Other assets  41,948   40,954   35,650   32,720   32,109 
Total assets $4,559,779  $4,537,102  $3,794,631  $3,405,010  $3,499,033 
LIABILITIES                    
Non-interest bearing deposits $724,527  $697,903  $561,033  $548,991  $564,225 
Interest bearing deposits  2,725,822   2,741,146   2,063,909   1,984,507   2,057,123 
Total deposits  3,450,349   3,439,049   2,624,942   2,533,498   2,621,348 
Customer repurchase agreements  4,485   13,248   10,509   6,751   11,488 
Federal Home Loan Bank advances  330,000   330,000   420,000   355,000   365,000 
Subordinated notes  48,929   48,903   48,878   48,853   48,828 
Junior subordinated debentures  39,083   38,966   38,849   38,734   38,623 
Other liabilities  50,326   50,295   44,228   19,230   22,048 
Total liabilities  3,923,172   3,920,461   3,187,406   3,002,066   3,107,335 
EQUITY                    
Preferred stock series A     4,550   4,550   4,550   4,550 
Preferred stock series B     5,108   5,108   5,108   5,108 
Common stock  271   264   264   209   209 
Additional paid-in-capital  469,341   458,920   457,980   265,406   264,855 
Treasury stock, at cost  (2,288)  (2,285)  (2,254)  (1,853)  (1,784)
Retained earnings  170,486   152,401   143,426   131,234   119,356 
Accumulated other comprehensive income  (1,203)  (2,317)  (1,849)  (1,710)  (596)
Total equity  636,607   616,641   607,225   402,944   391,698 
Total liabilities and equity $4,559,779  $4,537,102  $3,794,631  $3,405,010  $3,499,033 
 

 

Unaudited consolidated statement of income:

  For the Three Months Ended  For the Years Ended 
  December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31, 
 (Dollars in thousands) 2018  2018  2018  2018  2017  2018  2017 
Interest income:                            
Loans, including fees $44,435  $41,257  $38,148  $36,883  $34,856  $160,723  $121,567 
Factored receivables, including fees  28,070   27,939   20,791   15,303   15,000   92,103   47,177 
Securities  2,314   1,551   1,179   1,310   1,819   6,354   6,823 
FHLB stock  154   147   101   105   78   507   207 
Cash deposits  877   865   1,030   517   464   3,289   1,450 
Total interest income  75,850   71,759   61,249   54,118   52,217   262,976   177,224 
Interest expense:                            
Deposits  7,931   6,219   4,631   4,277   3,884   23,058   13,082 
Subordinated notes  839   837   838   837   836   3,351   3,344 
Junior subordinated debentures  717   714   713   597   520   2,741   1,955 
Other borrowings  1,482   2,207   1,810   1,277   1,181   6,776   3,159 
Total interest expense  10,969   9,977   7,992   6,988   6,421   35,926   21,540 
Net interest income  64,881   61,782   53,257   47,130   45,796   227,050   155,684 
Provision for loan losses  1,910   6,803   4,906   2,548   1,931   16,167   11,628 
Net interest income after provision for loan losses  62,971   54,979   48,351   44,582   43,865   210,883   144,056 
Non-interest income:                            
Service charges on deposits  1,702   1,412   1,210   1,145   1,178   5,469   4,181 
Card income  1,999   1,877   1,394   1,244   1,122   6,514   3,822 
Net OREO gains (losses) and valuation adjustments  37   65   (528)  (88)  (764)  (514)  (850)
Net gains (losses) on sale of securities           (272)     (272)  35 
Fee income  1,636   1,593   1,121   800   658   5,150   2,503 
Insurance commissions  846   1,113   819   714   857   3,492   2,981 
Asset management fees                    1,717 
Gain on sale of subsidiary           1,071      1,071   20,860 
Other  574   (1)  929   558   947   2,060   5,407 
Total non-interest income  6,794   6,059   4,945   5,172   3,998   22,970   40,656 
Non-interest expense:                            
Salaries and employee benefits  25,586   24,695   20,527   19,404   18,009   90,212   72,696 
Occupancy, furniture and equipment  4,402   3,553   3,014   3,054   2,728   14,023   9,833 
FDIC insurance and other regulatory assessments  184   363   383   199   411   1,129   1,201 
Professional fees  1,837   3,384   2,078   1,640   2,521   8,939   7,192 
Amortization of intangible assets  2,438   2,064   1,361   1,117   2,309   6,980   5,201 
Advertising and promotion  1,036   1,609   1,300   1,029   573   4,974   3,226 
Communications and technology  4,388   7,252   3,271   3,359   2,291   18,270   8,843 
Other  7,091   6,026   5,469   4,240   4,389   22,826   15,422 
Total non-interest expense  46,962   48,946   37,403   34,042   33,231   167,353   123,614 
Net income before income tax  22,803   12,092   15,893   15,712   14,632   66,500   61,098 
Income tax expense  4,718   2,922   3,508   3,644   8,327   14,792   24,878 
Net income $18,085  $9,170  $12,385  $12,068  $6,305  $51,708  $36,220 
Dividends on preferred stock     (195)  (193)  (190)  (194)  (578)  (774)
Net income available to common stockholders $18,085  $8,975  $12,192  $11,878  $6,111  $51,130  $35,446 
 

Earnings per share:

  For the Three Months Ended  For the Years Ended 
  December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31, 
(Dollars in thousands) 2018  2018  2018  2018  2017  2018  2017 
Basic                            
Net income to common stockholders $18,085  $8,975  $12,192  $11,878  $6,111  $51,130  $35,446 
Weighted average common shares outstanding  26,666,554   26,178,194   25,519,108   20,721,363   20,717,548   24,791,448   19,133,745 
Basic earnings per common share $0.68  $0.34  $0.48  $0.57  $0.29  $2.06  $1.85 
                             
Diluted                            
Net income to common stockholders $18,085  $8,975  $12,192  $11,878  $6,111  $51,130  $35,446 
Dilutive effect of preferred stock     195   193   190   194   578   774 
Net income to common stockholders - diluted $18,085  $9,170  $12,385  $12,068  $6,305  $51,708  $36,220 
Weighted average common shares outstanding  26,666,554   26,178,194   25,519,108   20,721,363   20,717,548   24,791,448   19,133,745 
Dilutive effects of:                            
Assumed conversion of Preferred A  89,240   315,773   315,773   315,773   315,773   258,674   315,773 
Assumed conversion of Preferred B  100,176   354,471   354,471   354,471   354,471   290,375   354,471 
Assumed exercises of stock warrants                    82,567 
Assumed exercises of stock options  76,219   90,320   86,821   83,872   56,359   84,126   45,653 
Restricted stock awards  46,457   45,796   37,417   85,045   74,318   52,851   68,079 
Restricted stock units  1,303   7,276   2,288         3,039    
Performance stock units                     
Weighted average shares outstanding - diluted  26,979,949   26,991,830   26,315,878   21,560,524   21,518,469   25,480,513   20,000,288 
Diluted earnings per common share $0.67  $0.34  $0.47  $0.56  $0.29  $2.03  $1.81 
                             
                             
Shares that were not considered in computing diluted earnings per common share because they were antidilutive are as follows: 
                             
  For the Three Months Ended  For the Years Ended 
  December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31, 
  2018  2018  2018  2018  2017  2018  2017 
Assumed conversion of Preferred A                     
Assumed conversion of Preferred B                     
Stock options  51,952   51,952   51,952      57,926   51,952   57,926 
Restricted stock awards  14,513   14,513                
Restricted stock units                     
Performance stock units  59,658   59,658   59,658         59,658    
                             

Loans held for investment summarized as of:

  December 31,  September 30,  June 30,  March 31,  December 31, 
 (Dollars in thousands) 2018  2018  2018  2018  2017 
Commercial real estate $992,080  $906,494  $766,839  $781,006  $745,893 
Construction, land development, land  179,591   190,920   147,852   143,876   134,812 
1-4 family residential properties  190,185   194,752   122,653   122,979   125,827 
Farmland  170,540   177,313   177,060   184,064   180,141 
Commercial  1,114,971   1,123,598   1,006,443   930,283   920,812 
Factored receivables  617,791   611,285   603,812   397,145   374,410 
Consumer  29,822   31,423   28,775   29,244   31,131 
Mortgage warehouse  313,664   276,358   343,028   285,388   297,830 
  Total loans $3,608,644  $3,512,143  $3,196,462  $2,873,985  $2,810,856 
 

A portion of our total loans held for investment portfolio consists of traditional community bank loans as well as commercial finance products offered under our commercial finance brands on a nationwide basis. Commercial finance loans are further summarized below:

  December 31,  September 30,  June 30,  March 31,  December 31, 
(Dollars in thousands) 2018  2018  2018  2018  2017 
Equipment $352,037  $323,832  $290,314  $260,502  $254,119 
Asset based lending (General)  214,110   273,096   261,412   230,314   213,471 
Premium finance  72,302   75,293   51,416   48,561   55,520 
Factored receivables  617,791   611,285   603,812   397,145   374,410 
  Commercial finance $1,256,240  $1,283,506  $1,206,954  $936,522  $897,520 
                     
Commercial finance % of total loans  35%  37%  38%  33%  32%

Additional information pertaining to our loan portfolio, summarized as of and for the quarters ended:

  December 31,  September 30,  June 30,  March 31,  December 31, 
(Dollars in thousands) 2018  2018  2018  2018  2017 
Average community banking $2,268,262  $2,039,624  $1,897,678  $1,816,921  $1,637,195 
Average commercial finance(1)  1,264,209   1,254,095   1,024,369   949,938   921,579 
Average total loans $3,532,471  $3,293,719  $2,922,047  $2,766,859  $2,558,774 
Community banking yield  5.78%  5.68%  5.80%  5.81%  5.87%
Commercial finance yield(1)  12.39%  12.66%  12.08%  11.17%  11.03%
Total loan yield  8.14%  8.33%  8.09%  7.65%  7.73%
 

(1) Includes assets held for sale for the periods ended March 31, 2018 and December 31, 2017

  

Information pertaining to our factoring segment, which includes only factoring originated by our Triumph Business Capital subsidiary, summarized as of and for the quarters ended:

   December 31,  September 30,  June 30,  March 31,  December 31, 
  2018  2018  2018  2018  2017 
Factored receivable period end balance $588,750,000  $579,985,000  $577,548,000  $372,771,000  $346,293,000 
Yield on average receivable balance  18.24%  18.96%  18.70%  17.40%  16.91%
Rolling twelve quarter annual charge-off rate  0.37%  0.38%  0.41%  0.50%  0.41%
Factored receivables - transportation concentration  83%  83%  84%  86%  84%
                     
Interest income, including fees $27,578,000  $27,420,000  $20,314,000  $14,780,000  $14,518,000 
Non-interest income  1,032,000   942,000   920,000   590,000   535,000 
Factored receivable total revenue  28,610,000   28,362,000   21,234,000   15,370,000   15,053,000 
Average net funds employed  547,996,000   525,499,000   398,096,000   316,488,000   309,614,000 
Yield on average net funds employed  20.71%  21.41%  21.39%  19.70%  19.29%
                     
Accounts receivable purchased $1,541,332,000  $1,503,049,000  $1,162,810,000  $912,336,000  $872,373,000 
Number of invoices purchased  882,042   836,771   656,429   521,906   511,879 
Average invoice size $1,747  $1,796  $1,771  $1,751  $1,705 
Average invoice size - transportation $1,625  $1,666  $1,695  $1,662  $1,647 
Average invoice size - non-transportation $3,209  $3,267  $2,522  $2,627  $2,251 
                     
Net new clients  259   422   2,072   280   233 
Period end clients  6,191   5,932   5,510   3,438   3,158 
                     

Deposits summarized as of:

  December 31,  September 30,  June 30,  March 31,  December 31, 
(Dollars in thousands) 2018  2018  2018  2018  2017 
Non-interest bearing demand $724,527  $697,903  $561,033  $548,991  $564,225 
Interest bearing demand  615,704   608,775   358,246   392,947   403,244 
Individual retirement accounts  115,583   118,459   101,380   105,558   108,505 
Money market  443,663   413,402   268,699   283,354   283,969 
Savings  369,389   373,062   239,127   244,103   235,296 
Certificates of deposit  835,127   854,048   751,290   783,651   837,384 
Brokered deposits  346,356   373,400   345,167   174,894   188,725 
  Total deposits $3,450,349  $3,439,049  $2,624,942  $2,533,498  $2,621,348 
 

Net interest margin summarized for the three months ended:

   December 31, 2018  September 30, 2018 
  Average      Average  Average      Average 
(Dollars in thousands) Balance  Interest  Rate  Balance  Interest  Rate 
Interest earning assets:                        
Interest earning cash balances $152,212  $877   2.29% $156,876  $865   2.19%
Taxable securities  235,234   1,674   2.82%  183,238   1,207   2.61%
Tax-exempt securities  123,575   640   2.05%  66,208   344   2.06%
FHLB stock  16,426   154   3.72%  20,984   147   2.78%
Loans  3,532,471   72,505   8.14%  3,293,719   69,196   8.33%
  Total interest earning assets $4,059,918  $75,850   7.41% $3,721,025  $71,759   7.65%
Non-interest earning assets:                        
Other assets  429,000           339,535         
  Total assets $4,488,918          $4,060,560         
Interest bearing liabilities:                        
Deposits:                        
Interest bearing demand $613,872  $417   0.27% $418,226  $200   0.19%
Individual retirement accounts  116,575   385   1.31%  105,774   339   1.27%
Money market  430,864   1,312   1.21%  303,843   594   0.78%
Savings  373,650   159   0.17%  272,230   60   0.09%
Certificates of deposit  862,500   3,749   1.72%  793,685   3,068   1.53%
  Brokered deposits  347,498   1,909   2.18%  384,337   1,958   2.02%
  Total deposits  2,744,959   7,931   1.15%  2,278,095   6,219   1.08%
Subordinated notes  48,914   839   6.81%  48,890   837   6.79%
Junior subordinated debentures  39,011   717   7.29%  38,905   714   7.28%
Other borrowings  262,391   1,482   2.24%  425,781   2,207   2.06%
  Total interest bearing liabilities $3,095,275  $10,969   1.41% $2,791,671  $9,977   1.42%
Non-interest bearing liabilities and equity:                        
Non-interest bearing demand deposits  714,884           608,245         
Other liabilities  46,633           41,961         
Total equity  632,126           618,683         
Total liabilities and equity $4,488,918          $4,060,560         
Net interest income     $64,881          $61,782     
Interest spread          6.00%          6.23%
Net interest margin          6.34%          6.59%
 

Metrics and non-GAAP financial reconciliation:

  As of and for the Three Months Ended  As of and for the Years Ended 
 (Dollars in thousands, December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31, 
 except per share amounts) 2018  2018  2018  2018  2017  2018  2017 
Net income available to common stockholders $18,085  $8,975  $12,192  $11,878  $6,111  $51,130  $35,446 
Gain on sale of subsidiary           (1,071)     (1,071)  (20,860)
Incremental bonus related to transaction                    4,814 
Transaction related costs     5,871   1,094      1,688   6,965   2,013 
Tax effect of adjustments     (1,392)  (257)  248   (601)  (1,401)  5,153 
Adjusted net income available to common stockholders $18,085  $13,454  $13,029  $11,055  $7,198  $55,623  $26,566 
Dilutive effect of convertible preferred stock     195   193   190   194   578   774 
Adjusted net income available to common stockholders - diluted $18,085  $13,649  $13,222  $11,245  $7,392  $56,201  $27,340 
                             
Weighted average shares outstanding - diluted  26,979,949   26,991,830   26,315,878   21,560,524   21,518,469   25,480,513   20,000,288 
Adjusted effects of assumed Preferred Stock conversion                     
Adjusted weighted average shares outstanding - diluted  26,979,949   26,991,830   26,315,878   21,560,524   21,518,469   25,480,513   20,000,288 
Adjusted diluted earnings per common share $0.67  $0.51  $0.50  $0.52  $0.34  $2.21  $1.37 
                             
Net income available to common stockholders $18,085  $8,975  $12,192  $11,878  $6,111  $51,130  $35,446 
Average tangible common equity  428,748   470,553   491,492   326,614   330,819   429,745   283,561 
Return on average tangible common equity  16.73%  7.57%  9.95%  14.75%  7.33%  11.90%  12.50%
                             
Adjusted efficiency ratio:                            
Net interest income $64,881  $61,782  $53,257  $47,130  $45,796  $227,050  $155,684 
Non-interest income  6,794   6,059   4,945   5,172   3,998   22,970   40,656 
Operating revenue  71,675   67,841   58,202   52,302   49,794   250,020   196,340 
Gain on sale of subsidiary           (1,071)     (1,071)  (20,860)
Adjusted operating revenue $71,675  $67,841  $58,202  $51,231  $49,794  $248,949  $175,480 
Non-interest expenses $46,962  $48,946  $37,403  $34,042  $33,231  $167,353  $123,614 
Incremental bonus related to transaction                    (4,814)
Transaction related costs     (5,871)  (1,094)     (1,688)  (6,965)  (2,013)
Adjusted non-interest expenses $46,962  $43,075  $36,309  $34,042  $31,543  $160,388  $116,787 
Adjusted efficiency ratio  65.52%  63.49%  62.38%  66.45%  63.35%  64.43%  66.55%