• HBT Financial, Inc. Announces Second Quarter 2022 Financial Results

    Source: Nasdaq GlobeNewswire / 25 Jul 2022 06:05:01   America/Chicago

    Second Quarter Highlights

    • Net income of $14.1 million, or $0.49 per diluted share; return on average assets (ROAA) of 1.32%; return on average stockholders' equity (ROAE) of 14.92%; and return on average tangible common equity (ROATCE)(1) of 16.25%
    • Adjusted net income(1) of $13.8 million; or $0.48 per diluted share; adjusted ROAA(1) of 1.29%; adjusted ROAE(1) of 14.66%; and adjusted ROATCE(1) of 15.96%

    (1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.

    BLOOMINGTON, Ill., July 25, 2022 (GLOBE NEWSWIRE) -- HBT Financial, Inc. (NASDAQ: HBT) (the “Company” or “HBT Financial” or “HBT”), the holding company for Heartland Bank and Trust Company, today reported net income of $14.1 million, or $0.49 diluted earnings per share, for the second quarter of 2022. This compares to net income of $13.6 million, or $0.47 diluted earnings per share, for the first quarter of 2022, and net income of $13.7 million, or $0.50 diluted earnings per share, for the second quarter of 2021.

    Fred L. Drake, Chairman and Chief Executive Officer of HBT Financial, said, “During the second quarter, we had significant expansion in our net interest margin, disciplined expense control, and continued strong asset quality, which enabled us to generate a higher level of earnings and returns compared to the prior quarter. Given our asset sensitive balance sheet, we expect to continue benefiting from higher interest rates, which along with our expectation for a higher level of loan growth in the second half of the year, should result in further increases in net interest income. As we look ahead, our franchise is built upon the foundation of a very stable deposit base and conservatively underwritten, well diversified loan portfolio that we believe will help us to effectively manage through any potential economic downturn and continue delivering strong financial performance. Combined with our exceptionally strong balance sheet, we believe our consistent financial performance will enable us to continue enhancing the value of our franchise and returning capital to our shareholders through our quarterly dividend and share repurchase program.”

    Adjusted Net Income

    In addition to reporting GAAP results, the Company believes adjusted net income and adjusted earnings per share, which adjust for acquisition expenses, branch closure expenses, gains (losses) on sale of closed branch premises, net earnings (losses) from closed or sold operations, charges related to termination of certain employee benefit plans, realized gains (losses) on sales of securities, and mortgage servicing rights fair value adjustments, provide investors with additional insight into its operational performance. The Company reported adjusted net income of $13.8 million, or $0.48 adjusted diluted earnings per share, for the second quarter of 2022. This compares to adjusted net income of $12.2 million, or $0.42 adjusted diluted earnings per share, for the first quarter of 2022, and adjusted net income of $14.2 million, or $0.52 adjusted diluted earnings per share, for the second quarter of 2021 (see "Reconciliation of Non-GAAP Financial Measures" tables).

    Net Interest Income and Net Interest Margin

    Net interest income for the second quarter of 2022 was $34.4 million, an increase of 7.7% from $31.9 million for the first quarter of 2022. The increase was primarily attributable to higher yields on interest-earning assets. Paycheck Protection Program (“PPP”) loan fees recognized as loan interest income totaled $0.6 million during the second quarter of 2022 and $0.7 million during the first quarter of 2022. As of June 30, 2022, the remaining deferred PPP loan fees to be recognized as income totaled $0.1 million.

    Relative to the second quarter of 2021, net interest income increased 15.7% from $29.7 million. The increase was primarily attributable to higher average balances of interest-earning assets following the NXT Bancorporation, Inc. (“NXT”) acquisition in the fourth quarter of 2021. PPP loan fees recognized as loan interest income totaled $2.4 million during the second quarter of 2021.

    Net interest margin for the second quarter of 2022 was 3.34%, compared to 3.08% for the first quarter of 2022. The increase was primarily attributable to higher yields on interest-earning assets. The contribution of PPP loan fees to net interest margin was 6 basis points during the second quarter of 2022 and 7 basis points during the first quarter of 2022. Additionally, the contribution of acquired loan discount accretion to net interest margin increased to 3 basis points during the second quarter of 2022 from 1 basis point during the first quarter of 2022.

    Relative to the second quarter of 2021, net interest margin increased from 3.14%. This increase was primarily attributable to a more favorable mix of interest-earning assets. PPP loan fees recognized as loan interest income contributed 25 basis points to net interest margin and acquired loan discount accretion contributed 2 basis points to net interest margin during the second quarter of 2021.

    Noninterest Income

    Noninterest income for the second quarter of 2022 was $8.6 million, a decrease of 14.9% from $10.0 million for the first quarter of 2022. The decrease was primarily attributable to a positive $0.4 million mortgage servicing rights (“MSR”) fair value adjustment included in the second quarter of 2022 results, compared to a positive $1.7 million MSR fair value adjustment included in the first quarter of 2022 results. Additionally, card income increased by $0.3 million during the second quarter of 2022, primarily due to increased card transaction volume. The increase in card income was mostly offset by a $0.3 million decrease in gains on sale of mortgage loans primarily as a result of a lower level of mortgage refinancing activity.

    Relative to the second quarter of 2021, noninterest income decreased 2.5% from $8.8 million, primarily due to a $1.2 million decrease in gains on sale of mortgage loans resulting from a lower level of mortgage refinancing activity. This decrease was mostly offset by increases in service charges on deposit accounts, wealth management fees, and card income.

    Noninterest Expense

    Noninterest expense for the second quarter of 2022 was $23.8 million, a decrease of 1.3% from $24.2 million for the first quarter of 2022. The decrease was primarily attributable to a $0.5 million decrease in employee benefits expense as the first quarter of 2022 results included accelerated recognition of $0.6 million of stock compensation expense as a result of a modification to all existing restricted stock unit and performance restricted stock unit agreements to address treatment upon retirement. Total compensation costs related to the modified agreements remains the same.

    Relative to the second quarter of 2021, noninterest expense increased 7.6% from $22.2 million. The increase was primarily attributable to a higher base level of noninterest expense following the NXT acquisition, primarily related to personnel costs and branch operations expenses.

    Loan Portfolio

    Total loans outstanding, before allowance for loan losses, were $2.45 billion at June 30, 2022, compared with $2.49 billion at March 31, 2022 and $2.15 billion at June 30, 2021. The $36.0 million decrease in total loans from March 31, 2022 was primarily attributable to a $41.2 million seasonal decrease in grain elevator operating lines within the commercial and industrial portfolio and a $13.7 million decrease from the ongoing forgiveness of PPP loans. These decreases were partially offset by a $26.0 million increase in multi-family loans.

    Deposits

    Total deposits were $3.70 billion at June 30, 2022, compared with $3.82 billion at March 31, 2022 and $3.42 billion at June 30, 2021. The $114.1 million decrease from March 31, 2022 was primarily attributable to lower balances maintained in retail and business accounts, partially offset by a seasonal increase in public fund accounts as a result of real estate tax collections.

    Asset Quality

    Nonperforming loans totaled $3.4 million, or 0.14% of total loans, at June 30, 2022, compared with $2.5 million, or 0.10% of total loans, at March 31, 2022, and $7.4 million, or 0.34% of total loans, at June 30, 2021.

    The Company recorded a provision for loan losses of $0.1 million for the second quarter of 2022, compared to a negative provision for loan losses of $0.6 million for the first quarter of 2022. The provision was primarily due to changes to qualitative factors reflecting a slight deterioration in the economic environment since the first quarter of 2022, resulting in a $0.4 million increase in required reserve; a decrease in specific reserves on loans individually evaluated for impairment, resulting in a $0.2 million decrease in required reserves; and $0.1 million of net recoveries during the quarter.

    The Company had net recoveries of $0.1 million, or (0.01)% of average loans on an annualized basis, for the second quarter of 2022, compared to net recoveries of $1.2 million, or (0.19)% of average loans on an annualized basis, for the first quarter of 2022, and net charge-offs of $90 thousand, or 0.02% of average loans on an annualized basis, for the second quarter of 2021.

    The Company’s allowance for loan losses was 1.01% of total loans and 721.11% of nonperforming loans at June 30, 2022, compared with 0.99% of total loans and 992.63% of nonperforming loans at March 31, 2022.

    Capital

    At June 30, 2022, the Company exceeded all regulatory capital requirements under Basel III as summarized in the following table:

       
      Well Capitalized
      Regulatory
     June 30, 2022Requirements
    Total capital to risk-weighted assets16.76%10.00%
    Tier 1 capital to risk-weighted assets14.59%8.00%
    Common equity tier 1 capital ratio13.36%6.50%
    Tier 1 leverage ratio10.05%5.00%
    Total stockholders' equity to total assets8.85%N/A
    Tangible common equity to tangible assets (1)8.18%N/A


    (1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.

    Stock Repurchase Program

    During the second quarter of 2022, the Company repurchased 136,746 shares of its common stock at a weighted average price of $17.61 under its stock repurchase program. The Company’s Board of Directors authorized the repurchase of up to $15 million of its common stock under its stock repurchase program in effect until January 1, 2023. As of June 30, 2022, the Company had $11.6 million remaining under the current stock repurchase authorization.

    About HBT Financial, Inc.

    HBT Financial, Inc., headquartered in Bloomington, Illinois, is the holding company for Heartland Bank and Trust Company, and has banking roots that can be traced back to 1920. HBT provides a comprehensive suite of business, commercial, wealth management, and retail banking products and services to individuals, businesses and municipal entities throughout Central and Northeastern Illinois and Eastern Iowa through 61 branches. As of June 30, 2022, HBT had total assets of $4.2 billion, total loans of $2.5 billion, and total deposits of $3.7 billion.

    Non-GAAP Financial Measures

    Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with GAAP. These non-GAAP financial measures include net interest income (tax-equivalent basis), net interest margin (tax-equivalent basis), efficiency ratio (tax-equivalent basis), tangible common equity to tangible assets, tangible book value per share, return on average tangible common equity, adjusted net income, adjusted earnings per share, adjusted return on average assets, adjusted return on average stockholders' equity, and adjusted return on average tangible common equity. Our management uses these non-GAAP financial measures, together with the related GAAP financial measures, in its analysis of our performance and in making business decisions. Management believes that it is a standard practice in the banking industry to present these non-GAAP financial measures, and accordingly believes that providing these measures may be useful for peer comparison purposes. These disclosures should not be viewed as substitutes for the results determined to be in accordance with GAAP; nor are they necessarily comparable to non-GAAP financial measures that may be presented by other companies. See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures in the "Reconciliation of Non-GAAP Financial Measures" tables.

    Forward-Looking Statements

    Readers should note that in addition to the historical information contained herein, this press release contains, and future oral and written statements of the Company and its management may contain, "forward-looking statements" within the meanings of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "will," "propose," "may," "plan," "seek," "expect," "intend," "estimate," "anticipate," "believe," "continue," or “should,” or similar terminology. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

    Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to: (i) the strength of the local, state, national and international economies (including effects of inflationary pressures and supply chain constraints); (ii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics (including the COVID-19 pandemic in the United States), acts of war or other threats thereof, or other adverse external events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies, the FASB or the PCAOB; (iv) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business; (v) changes in interest rates and prepayment rates of the Company’s assets (including the impact of LIBOR phase-out); (vi) increased competition in the financial services sector and the inability to attract new customers; (vii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (viii) unexpected results of acquisitions, which may include failure to realize the anticipated benefits of acquisitions and the possibility that transaction costs may be greater than anticipated; (ix) the loss of key executives or employees; (x) changes in consumer spending; (xi) unexpected outcomes of existing or new litigation involving the Company; (xii) the economic impact of exceptional weather occurrences such as tornadoes, floods and blizzards; and (xiii) the ability of the Company to manage the risks associated with the foregoing. Readers should note that the forward-looking statements included in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.

    CONTACT:
    Tony Rossi
    HBTIR@hbtbank.com 
    (310) 622-8221

    HBT Financial, Inc.
    Unaudited Consolidated Financial Summary
    Consolidated Statements of Income

                    
      Three Months Ended  Six Months Ended
      June 30,  March 31,  June 30,  June 30, 
         2022    2022    2021    2022    2021
    INTEREST AND DIVIDEND INCOME (dollars in thousands, except per share data)
    Loans, including fees:               
    Taxable $27,843  $26,806  $25,278  $54,649  $50,412 
    Federally tax exempt  679   662   540   1,341   1,150 
    Securities:               
    Taxable  5,663   4,649   4,058   10,312   7,691 
    Federally tax exempt  1,138   1,040   1,144   2,178   2,280 
    Interest-bearing deposits in bank  420   159   115   579   195 
    Other interest and dividend income  14   19   12   33   25 
    Total interest and dividend income  35,757   33,335   31,147   69,092   61,753 
                    
    INTEREST EXPENSE               
    Deposits  506   569   613   1,075   1,257 
    Securities sold under agreements to repurchase  8   9   8   17   15 
    Borrowings  1   1   —   2   1 
    Subordinated notes  469   470   469   939   939 
    Junior subordinated debentures issued to capital trusts  400   358   357   758   712 
    Total interest expense  1,384   1,407   1,447   2,791   2,924 
    Net interest income  34,373   31,928   29,700   66,301   58,829 
    PROVISION FOR LOAN LOSSES  145   (584)  (2,162)  (439)  (5,567)
    Net interest income after provision for loan losses  34,228   32,512   31,862   66,740   64,396 
                    
    NONINTEREST INCOME               
    Card income  2,714   2,404   2,449   5,118   4,707 
    Wealth management fees  2,322   2,289   2,005   4,611   3,977 
    Service charges on deposit accounts  1,792   1,652   1,390   3,444   2,687 
    Mortgage servicing  661   658   711   1,319   1,396 
    Mortgage servicing rights fair value adjustment  366   1,729   (310)  2,095   1,385 
    Gains on sale of mortgage loans  326   587   1,562   913   3,662 
    Unrealized gains (losses) on equity securities  (153)  (187)  6   (340)  46 
    Gains (losses) on foreclosed assets  (7)  40   216   33   140 
    Gains (losses) on other assets  (43)  193   (48)  150   (47)
    Income on bank owned life insurance  41   40   —   81   — 
    Other noninterest income  532   638   793   1,170   1,629 
    Total noninterest income  8,551   10,043   8,774   18,594   19,582 
                    
    NONINTEREST EXPENSE               
    Salaries  12,936   12,801   12,173   25,737   24,651 
    Employee benefits  1,984   2,444   1,409   4,428   3,094 
    Occupancy of bank premises  1,741   2,060   1,463   3,801   3,401 
    Furniture and equipment  623   552   603   1,175   1,226 
    Data processing  1,990   1,653   1,721   3,643   3,409 
    Marketing and customer relations  1,205   851   843   2,056   1,408 
    Amortization of intangible assets  245   245   258   490   547 
    FDIC insurance  298   288   244   586   484 
    Loan collection and servicing  278   157   333   435   698 
    Foreclosed assets  31   132   319   163   462 
    Other noninterest expense  2,511   2,974   2,788   5,485   5,318 
    Total noninterest expense  23,842   24,157   22,154   47,999   44,698 
    INCOME BEFORE INCOME TAX EXPENSE  18,937   18,398   18,482   37,335   39,280 
    INCOME TAX EXPENSE  4,852   4,794   4,765   9,646   10,318 
    NET INCOME $14,085  $13,604  $13,717  $27,689  $28,962 
                    
    EARNINGS PER SHARE - BASIC $0.49  $0.47  $0.50  $0.96  $1.06 
    EARNINGS PER SHARE - DILUTED $0.49  $0.47  $0.50  $0.95  $1.05 
    WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING  28,891,202   28,986,593   27,362,579   28,938,634   27,396,557 
                         

    HBT Financial, Inc.
    Unaudited Consolidated Financial Summary
    Consolidated Balance Sheets

              
      June 30,  March 31,    June 30, 
      2022    2022    2021
      (dollars in thousands)
    ASSETS         
    Cash and due from banks $25,478  $30,761  $47,861 
    Interest-bearing deposits with banks  134,553   328,218   497,742 
    Cash and cash equivalents  160,031   358,979   545,603 
              
    Interest-bearing time deposits with banks  —   487   — 
    Debt securities available-for-sale, at fair value  924,706   933,922   836,267 
    Debt securities held-to-maturity  548,236   438,054   309,132 
    Equity securities with readily determinable fair value  3,103   3,256   3,338 
    Equity securities with no readily determinable fair value  1,952   1,927   1,552 
    Restricted stock, at cost  2,813   2,739   2,739 
    Loans held for sale  5,312   1,777   5,951 
              
    Loans, before allowance for loan losses  2,451,826   2,487,785   2,152,119 
    Allowance for loan losses  (24,734)  (24,508)  (26,507)
    Loans, net of allowance for loan losses  2,427,092   2,463,277   2,125,612 
              
    Bank owned life insurance  7,474   7,433   — 
    Bank premises and equipment, net  51,433   52,005   51,900 
    Bank premises held for sale  319   1,081   121 
    Foreclosed assets  2,891   3,043   7,757 
    Goodwill  29,322   29,322   23,620 
    Core deposit intangible assets, net  1,453   1,698   2,251 
    Mortgage servicing rights, at fair value  10,089   9,723   7,319 
    Investments in unconsolidated subsidiaries  1,165   1,165   1,165 
    Accrued interest receivable  14,263   13,527   12,785 
    Other assets  32,324   25,550   16,565 
    Total assets $4,223,978  $4,348,965  $3,953,677 
              
    LIABILITIES AND STOCKHOLDERS' EQUITY         
    Liabilities         
    Deposits:         
    Noninterest-bearing $1,028,790  $1,069,231  $1,011,481 
    Interest-bearing  2,673,196   2,746,838   2,413,153 
    Total deposits  3,701,986   3,816,069   3,424,634 
              
    Securities sold under agreements to repurchase  51,091   50,834   46,756 
    Subordinated notes  39,356   39,336   39,277 
    Junior subordinated debentures issued to capital trusts  37,747   37,731   37,681 
    Other liabilities  19,989   21,840   32,135 
    Total liabilities  3,850,169   3,965,810   3,580,483 
              
    Stockholders' Equity         
    Common stock  293   293   275 
    Surplus  222,087   221,735   191,185 
    Retained earnings  212,506   203,076   175,328 
    Accumulated other comprehensive income (loss)  (52,820)  (36,100)  8,386 
    Treasury stock at cost  (8,257)  (5,849)  (1,980)
    Total stockholders’ equity  373,809   383,155   373,194 
    Total liabilities and stockholders’ equity $4,223,978  $4,348,965  $3,953,677 
              
    SHARE INFORMATION         
    Shares of common stock outstanding  28,831,197   28,967,943   27,355,053 
                 

    HBT Financial, Inc.
    Unaudited Consolidated Financial Summary

              
      June 30,  March 31,    June 30, 
      2022    2022    2021
      (dollars in thousands)
    LOANS         
    Commercial and industrial $249,839 $291,909 $321,352
    Agricultural and farmland  230,370  232,528  231,527
    Commercial real estate - owner occupied  228,997  237,000  212,597
    Commercial real estate - non-owner occupied  656,093  687,617  531,803
    Multi-family  269,452  243,447  212,079
    Construction and land development  332,041  320,030  204,619
    One-to-four family residential  325,047  327,791  302,888
    Municipal, consumer, and other  159,987  147,463  135,254
    Loans, before allowance for loan losses $2,451,826 $2,487,785 $2,152,119
              
    PPP LOANS (included above)         
    Commercial and industrial $2,823 $16,184 $115,538
    Agricultural and farmland  9  392  8,711
    Municipal, consumer, and other  —  —  1,273
    Total PPP Loans $2,832 $16,576 $125,522


              
      June 30,  March 31,    June 30, 
      2022    2022    2021
      (dollars in thousands)
    DEPOSITS         
    Noninterest-bearing $1,028,790 $1,069,231 $1,011,481
    Interest-bearing demand  1,162,292  1,167,058  1,023,565
    Money market  581,058  597,464  506,880
    Savings  654,953  687,147  603,849
    Time  274,893  295,169  278,859
    Total deposits $3,701,986 $3,816,069 $3,424,634
              

    HBT Financial, Inc.
    Unaudited Consolidated Financial Summary

                             
     Three Months Ended  
     June 30, 2022 March 31, 2022 June 30, 2021 
     Average
    Balance    		 Interest Yield/
    Cost*    		 Average
    Balance    		 Interest Yield/
    Cost*    		 Average
    Balance    		 Interest Yield/
    Cost*    		 
     (dollars in thousands) 
    ASSETS                        
    Loans$2,467,851  $28,522 4.64%$2,507,006  $27,468 4.44%$2,234,388  $25,818 4.63%
    Securities 1,422,096   6,801 1.92  1,321,918   5,689 1.75  1,121,104   5,202 1.86 
    Deposits with banks 240,692   420 0.70  370,130   159 0.17  438,001   115 0.11 
    Other 2,809   14 2.07  2,739   19 2.80  2,726   12 1.83 
    Total interest-earning assets 4,133,448  $35,757 3.47% 4,201,793  $33,335 3.22% 3,796,219  $31,147 3.29%
    Allowance for loan losses (24,579)       (24,099)       (28,939)      
    Noninterest-earning assets 177,433        165,752        156,559       
    Total assets$4,286,302       $4,343,446       $3,923,839       
                             
    LIABILITIES AND STOCKHOLDERS' EQUITY                        
    Liabilities                        
    Interest-bearing deposits:                        
    Interest-bearing demand$1,159,077  $144 0.05%$1,143,829  $142 0.05%$1,019,488  $127 0.05%
    Money market 582,016   110 0.08  598,271   121 0.08  502,448   94 0.08 
    Savings 661,661   52 0.03  649,563   50 0.03  601,615   46 0.03 
    Time 284,880   200 0.28  310,675   256 0.33  290,865   346 0.48 
    Total interest-bearing deposits 2,687,634   506 0.08  2,702,338   569 0.09  2,414,416   613 0.10 
    Securities sold under agreements to repurchase 51,057   8 0.07  53,054   9 0.07  47,170   8 0.07 
    Borrowings 440   1 1.34  500   1 0.71  440   — 0.39 
    Subordinated notes 39,346   469 4.79  39,325   470 4.84  39,265   469 4.80 
    Junior subordinated debentures issued to capital trusts 37,738   400 4.26  37,721   358 3.85  37,671   357 3.80 
    Total interest-bearing liabilities 2,816,215  $1,384 0.20% 2,832,938  $1,407 0.20% 2,538,962  $1,447 0.23%
    Noninterest-bearing deposits 1,072,883        1,077,917        992,699       
    Noninterest-bearing liabilities 18,673        26,302        26,988       
    Total liabilities 3,907,771        3,937,157        3,558,649       
    Stockholders' Equity 378,531        406,289        365,190       
    Total liabilities and stockholders’ equity$4,286,302       $4,343,446       $3,923,839       
                             
    Net interest income/Net interest margin (1)   $34,373 3.34%   $31,928 3.08%   $29,700 3.14%
    Tax-equivalent adjustment (2)    598 0.05     529 0.05     503 0.05 
    Net interest income (tax-equivalent basis)/ Net interest margin (tax-equivalent basis) (2) (3)   $34,971 3.39%   $32,457 3.13%   $30,203 3.19%
    Net interest rate spread (4)      3.27%      3.02%      3.06%
    Net interest-earning assets (5)$1,317,233       $1,368,855       $1,257,257       
    Ratio of interest-earning assets to interest-bearing liabilities 1.47        1.48        1.50       
    Cost of total deposits      0.05%      0.06%      0.07%


    * Annualized measure.
    (1) Net interest margin represents net interest income divided by average total interest-earning assets.
    (2) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state income tax rate of 9.5%.
    (3) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
    (4) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
    (5) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.

    HBT Financial, Inc.
    Unaudited Consolidated Financial Summary

                      
      Six Months Ended  
      June 30, 2022 June 30, 2021 
      Average     Average     
      Balance Interest Yield/Cost* Balance Interest Yield/Cost* 
      (dollars in thousands)
    ASSETS                 
    Loans $2,487,320  $55,990 4.54%$2,259,136  $51,562 4.60%
    Securities  1,372,284   12,490 1.84  1,063,312   9,971 1.89 
    Deposits with banks  305,053   579 0.38  392,213   195 0.10 
    Other  2,775   33 2.43  2,612   25 1.93 
    Total interest-earning assets  4,167,432  $69,092 3.34% 3,717,273  $61,753 3.35%
    Allowance for loan losses  (24,340)       (30,390)      
    Noninterest-earning assets  171,624        156,093       
    Total assets $4,314,716       $3,842,976       
                      
    LIABILITIES AND STOCKHOLDERS' EQUITY                 
    Liabilities                 
    Interest-bearing deposits:                 
    Interest-bearing demand $1,151,495  $286 0.05%$1,008,664  $244 0.05%
    Money market  590,098   231 0.08  492,472   183 0.07 
    Savings  655,645   102 0.03  571,921   87 0.03 
    Time  297,706   456 0.31  292,509   743 0.51 
    Total interest-bearing deposits  2,694,944   1,075 0.08  2,365,566   1,257 0.11 
    Securities sold under agreements to repurchase  52,050   17 0.07  46,761   15 0.06 
    Borrowings  470   2 1.01  470   1 0.42 
    Subordinated notes  39,335   939 4.82  39,255   939 4.83 
    Junior subordinated debentures issued to capital trusts  37,730   758 4.05  37,663   712 3.81 
    Total interest-bearing liabilities  2,824,529  $2,791 0.20% 2,489,715  $2,924 0.24%
    Noninterest-bearing deposits  1,075,387        956,806       
    Noninterest-bearing liabilities  22,466        32,077       
    Total liabilities  3,922,382        3,478,598       
    Stockholders' Equity  392,334        364,378       
    Total liabilities and stockholders’ equity $4,314,716        3,842,976       
                      
    Net interest income/Net interest margin (1)    $66,301 3.21%   $58,829 3.19%
    Tax-equivalent adjustment (2)     1,127 0.05     1,006 0.06 
    Net interest income (tax-equivalent basis)/ Net interest margin (tax-equivalent basis) (2) (3)    $67,428 3.26%   $59,835 3.25%
    Net interest rate spread (4)       3.14%      3.11%
    Net interest-earning assets (5) $1,342,903       $1,227,558       
    Ratio of interest-earning assets to interest-bearing liabilities  1.48        1.49       
    Cost of total deposits       0.06%      0.08%


    * Annualized measure.
    (1) Net interest margin represents net interest income divided by average total interest-earning assets.
    (2) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state income tax rate of 9.5%.
    (3) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
    (4) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
    (5) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.

    HBT Financial, Inc.
    Unaudited Consolidated Financial Summary

               
      June 30,  March 31,  June 30,  
      2022    2022    2021 
      (dollars in thousands) 
    NONPERFORMING ASSETS          
    Nonaccrual $3,248 $2,461 $6,823 
    Past due 90 days or more, still accruing (1)  182  8  583 
    Total nonperforming loans  3,430  2,469  7,406 
    Foreclosed assets  2,891  3,043  7,757 
    Total nonperforming assets $6,321 $5,512 $15,163 
               
    Allowance for loan losses $24,734 $24,508 $26,507 
    Loans, before allowance for loan losses  2,451,826  2,487,785  2,152,119 
               
    CREDIT QUALITY RATIOS          
    Allowance for loan losses to loans, before allowance for loan losses  1.01% 0.99% 1.23%
    Allowance for loan losses to nonaccrual loans  761.51  995.86  388.49 
    Allowance for loan losses to nonperforming loans  721.11  992.63  357.91 
    Nonaccrual loans to loans, before allowance for loan losses  0.13  0.10  0.32 
    Nonperforming loans to loans, before allowance for loan losses  0.14  0.10  0.34 
    Nonperforming assets to total assets  0.15  0.13  0.38 
    Nonperforming assets to loans, before allowance for loan losses and foreclosed assets  0.26  0.22  0.70 


    (1) Excludes loans acquired with deteriorated credit quality that are past due 90 or more days, still accruing totaling $23 thousand, $25 thousand, and $27 thousand as of June 30, 2022, March 31, 2022 and June 30, 2021, respectively.

                     
      Three Months Ended  Six Months Ended  
      June 30,  March 31,  June 30,  June 30,  
         2022    2022    2021    2022    2021 
    ALLOWANCE FOR LOAN LOSSES (dollars in thousands) 
    Beginning balance $24,508  $23,936  $28,759  $23,936  $31,838  
    Provision  145   (584)  (2,162)  (439)  (5,567) 
    Charge-offs  (159)  (134)  (402)  (293)  (597) 
    Recoveries  240   1,290   312   1,530   833  
    Ending balance $24,734  $24,508  $26,507  $24,734  $26,507  
                     
    Net charge-offs (recoveries) $(81) $(1,156) $90  $(1,237) $(236) 
    Average loans, before allowance for loan losses  2,467,851   2,507,006   2,234,388   2,487,320   2,259,136  
                     
    Net charge-offs (recoveries) to average loans, before allowance for loan losses *  (0.01)% (0.19)% 0.02 % (0.10)% (0.02)%


    * Annualized measure.

    HBT Financial, Inc.
    Unaudited Consolidated Financial Summary

                     
      As of or for the Three Months Ended  Six Months Ended  
      June 30,  March 31,  June 30,  June 30,  
         2022    2022    2021    2022    2021 
      (dollars in thousands, except per share data) 
    EARNINGS AND PER SHARE INFORMATION                
    Net income $14,085 $13,604 $13,717 $27,689 $28,962 
    Earnings per share - Basic  0.49  0.47  0.50  0.96  1.06 
    Earnings per share - Diluted  0.49  0.47  0.50  0.95  1.05 
                     
    Adjusted net income (1) $13,836 $12,227 $14,168 $26,063 $28,201 
    Adjusted earnings per share - Basic (1)  0.48  0.42  0.52  0.90  1.03 
    Adjusted earnings per share - Diluted (1)  0.48  0.42  0.52  0.90  1.03 
                     
    Book value per share $12.97 $13.23 $13.64       
    Tangible book value per share (1)  11.90  12.16  12.70       
                     
    Shares of common stock outstanding  28,831,197  28,967,943  27,355,053       
    Weighted average shares of common stock outstanding  28,891,202  28,986,593  27,362,579  28,938,634  27,396,557 
                     
    SUMMARY RATIOS                
    Net interest margin *  3.34% 3.08% 3.14% 3.21% 3.19%
    Net interest margin (tax equivalent basis) * (1)(2)  3.39  3.13  3.19  3.26  3.25 
                     
    Efficiency ratio  54.97% 56.97% 56.91% 55.96% 56.31%
    Efficiency ratio (tax equivalent basis) (1)(2)  54.22  56.26  56.18  55.23  55.59 
                     
    Loan to deposit ratio  66.23% 65.19% 62.84%      
                     
    Return on average assets *  1.32% 1.27% 1.40% 1.29% 1.52%
    Return on average stockholders' equity *  14.92  13.58  15.07  14.23  16.03 
    Return on average tangible common equity * (1)  16.25  14.71  16.22  15.45  17.27 
                     
    Adjusted return on average assets * (1)  1.29% 1.14% 1.45% 1.22% 1.48%
    Adjusted return on average stockholders' equity * (1)  14.66  12.20  15.56  13.40  15.61 
    Adjusted return on average tangible common equity * (1)  15.96  13.22  16.76  14.55  16.81 


    * Annualized measure.
    (1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
    (2) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.



    Reconciliation of Non-GAAP Financial Measures –
    Adjusted Net Income and Adjusted Return on Average Assets

                     
      Three Months Ended  Six Months Ended  
      June 30,  March 31,  June 30,  June 30,  
         2022    2022    2021    2022    2021 
      (dollars in thousands) 
    Net income $14,085  $13,604  $13,717  $27,689  $28,962  
    Adjustments:                
    Acquisition expenses  —   —   (157)  —   (157) 
    Branch closure expenses  —   —   (104)  —   (104) 
    Gains (losses) on sales of closed branch premises  (18)  197   —   179   —  
    Mortgage servicing rights fair value adjustment  366   1,729   (310)  2,095   1,385  
    Total adjustments  348   1,926   (571)  2,274   1,124  
    Tax effect of adjustments  (99)  (549)  120   (648)  (363) 
    Less adjustments, after tax effect  249   1,377   (451)  1,626   761  
    Adjusted net income $13,836  $12,227  $14,168  $26,063  $28,201  
                     
    Average assets $4,286,302  $4,343,446  $3,923,839  $4,314,716  $3,842,976  
                     
    Return on average assets *  1.32 % 1.27 % 1.40 % 1.29 % 1.52 %
    Adjusted return on average assets *  1.29   1.14   1.45   1.22   1.48  


    * Annualized measure.

    Reconciliation of Non-GAAP Financial Measures –
    Adjusted Earnings Per Share

                    
      Three Months Ended  Six Months Ended
      June 30,  March 31,  June 30,  June 30, 
         2022    2022    2021    2022    2021
      (dollars in thousands, except per share data)
    Numerator:               
    Net income $14,085  $13,604  $13,717  $27,689  $28,962 
    Earnings allocated to participating securities (1)  (17)  (17)  (25)  (34)  (56)
    Numerator for earnings per share - basic and diluted $14,068  $13,587  $13,692  $27,655  $28,906 
                    
    Adjusted net income $13,836  $12,227  $14,168  $26,063  $28,201 
    Earnings allocated to participating securities (1)  (17)  (15)  (26)  (32)  (54)
    Numerator for adjusted earnings per share - basic and diluted $13,819  $12,212  $14,142  $26,031  $28,147 
                    
    Denominator:               
    Weighted average common shares outstanding  28,891,202   28,986,593   27,362,579   28,938,634   27,396,557 
    Dilutive effect of outstanding restricted stock units  53,674   43,646   17,701   48,688   10,137 
    Weighted average common shares outstanding, including all dilutive potential shares  28,944,876   29,030,239   27,380,280   28,987,322   27,406,694 
                    
    Earnings per share - Basic $0.49  $0.47  $0.50  $0.96  $1.06 
    Earnings per share - Diluted $0.49  $0.47  $0.50  $0.95  $1.05 
                    
    Adjusted earnings per share - Basic $0.48  $0.42  $0.52  $0.90  $1.03 
    Adjusted earnings per share - Diluted $0.48  $0.42  $0.52  $0.90  $1.03 


    (1) The Company has granted certain restricted stock units that contain non-forfeitable rights to dividend equivalents. Such restricted stock units are considered participating securities. As such, we have included these restricted stock units in the calculation of basic earnings per share and calculate basic earnings per share using the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings.


    Reconciliation of Non-GAAP Financial Measures –
    Net Interest Income and Net Interest Margin (Tax Equivalent Basis)

                     
      Three Months Ended  Six Months Ended  
      June 30,  March 31,  June 30,  June 30,  
         2022    2022    2021    2022    2021 
      (dollars in thousands) 
    Net interest income (tax equivalent basis)                
    Net interest income $34,373 $31,928 $29,700 $66,301 $58,829 
    Tax-equivalent adjustment (1)  598  529  503  1,127  1,006 
    Net interest income (tax equivalent basis) (1) $34,971 $32,457 $30,203 $67,428 $59,835 
                     
    Net interest margin (tax equivalent basis)                
    Net interest margin *  3.34% 3.08% 3.14% 3.21% 3.19%
    Tax-equivalent adjustment * (1)  0.05  0.05  0.05  0.05  0.06 
    Net interest margin (tax equivalent basis) * (1)  3.39% 3.13% 3.19% 3.26% 3.25%
                     
    Average interest-earning assets $4,133,448 $4,201,793 $3,796,219 $4,167,432 $3,717,273 


    * Annualized measure.
    (1) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.

    Reconciliation of Non-GAAP Financial Measures –
    Efficiency Ratio (Tax Equivalent Basis)

                     
      Three Months Ended  Six Months Ended  
      June 30,  March 31,  June 30,  June 30,  
         2022    2022    2021    2022    2021 
      (dollars in thousands) 
    Efficiency ratio (tax equivalent basis)                
    Total noninterest expense $23,842 $24,157 $22,154 $47,999 $44,698 
    Less: amortization of intangible assets  245  245  258  490  547 
    Adjusted noninterest expense $23,597 $23,912 $21,896 $47,509 $44,151 
                     
    Net interest income $34,373 $31,928 $29,700 $66,301 $58,829 
    Total noninterest income  8,551  10,043  8,774  18,594  19,582 
    Operating revenue  42,924  41,971  38,474  84,895  78,411 
    Tax-equivalent adjustment (1)  598  529  503  1,127  1,006 
    Operating revenue (tax equivalent basis) (1) $43,522 $42,500 $38,977 $86,022 $79,417 
                     
    Efficiency ratio  54.97% 56.97% 56.91% 55.96% 56.31%
    Efficiency ratio (tax equivalent basis) (1)  54.22  56.26  56.18  55.23  55.59 


    (1) On a tax-equivalent basis assuming a federal income tax rate of 21% and a state tax rate of 9.5%.

    Reconciliation of Non-GAAP Financial Measures –
    Tangible Common Equity to Tangible Assets and Tangible Book Value Per Share

               
      June 30,  March 31,    June 30,  
      2022    2022    2021 
      (dollars in thousands, except per share data) 
    Tangible common equity          
    Total stockholders' equity $373,809 $383,155 $373,194 
    Less: Goodwill  29,322  29,322  23,620 
    Less: Core deposit intangible assets, net  1,453  1,698  2,251 
    Tangible common equity $343,034 $352,135 $347,323 
               
    Tangible assets          
    Total assets $4,223,978 $4,348,965 $3,953,677 
    Less: Goodwill  29,322  29,322  23,620 
    Less: Core deposit intangible assets, net  1,453  1,698  2,251 
    Tangible assets $4,193,203 $4,317,945 $3,927,806 
               
    Total stockholders' equity to total assets  8.85% 8.81% 9.44%
    Tangible common equity to tangible assets  8.18  8.16  8.84 
               
    Shares of common stock outstanding  28,831,197  28,967,943  27,355,053 
               
    Book value per share $12.97 $13.23 $13.64 
    Tangible book value per share  11.90  12.16  12.70 
               

    Reconciliation of Non-GAAP Financial Measures –
    Return on Average Tangible Common Equity,
    Adjusted Return on Average Stockholders' Equity and Adjusted Return on Tangible Common Equity

                     
      Three Months Ended  Six Months Ended  
      June 30,  March 31,  June 30,  June 30,  
         2022    2022    2021    2022    2021 
      (dollars in thousands) 
    Average tangible common equity                
    Total stockholders' equity $378,531 $406,289 $365,190 $392,334 $364,378 
    Less: Goodwill  29,322  29,322  23,620  29,322  23,620 
    Less: Core deposit intangible assets, net  1,597  1,844  2,410  1,720  2,547 
    Average tangible common equity $347,612 $375,123 $339,160 $361,292 $338,211 
                     
    Net income $14,085 $13,604 $13,717 $27,689 $28,962 
    Adjusted net income  13,836  12,227  14,168  26,063  28,201 
                     
    Return on average stockholders' equity *  14.92% 13.58% 15.07% 14.23% 16.03%
    Return on average tangible common equity *  16.25  14.71  16.22  15.45  17.27 
                     
    Adjusted return on average stockholders' equity *  14.66% 12.20% 15.56% 13.40% 15.61%
    Adjusted return on average tangible common equity *  15.96  13.22  16.76  14.55  16.81 


    * Annualized measure.

     


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