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EX - 99.1 2 gnty - 20210719ex99_1.htm EX - 99.1 Exhibit 99.1 Press Release For Immediate Release Guaranty Bancshares , Inc. Reports Second Quarter 2021 Financial Results Addison , Texas - July 19 , 2021 / Business Wire / - Guaranty Bancshares , Inc. ( NASDAQ : GNTY ) , the parent company of Guaranty Bank & Trust , N.A. , today reported financial results for the fiscal quarter ended June 30 , 2021. The Company's net income available to common shareholders was $ 10.4 million , or $ 0.87 per basic share , for the quarter ended June 30 , 2021 , compared to $ 11.0 million , or $ 0.91 per basic share , for the quarter ended March 31 , 2021 and $ 1.1 million , or $ 0.09 per basic share , for the quarter ended June 30 , 2020. Return on average assets and average equity for the second quarter of 2021 were 1.42 % and 14.64 % , respectively , compared to 1.60 % and 16.01 % , respectively , for the first quarter of 2021 and 0.16 % and 1.67 % , respectively , for the second quarter of 2020. The decrease in earnings during the second quarter of 2021 , compared to the first quarter of 2021 , was primarily due to lower origination fee income recognized during the quarter for the Paycheck Protection Program - round one ( " PPP1 " ) and round two ( " PPP2 " ) loans , which was partially offset by a reverse provision for credit losses of $ 1.0 million . Our core earnings * , excluding provisions for credit losses , income taxes and PPP1 / PPP2 net origination income , as well as our core net interest margin , adjusted to exclude the effects of PPP1 / PPP2 loans , are described further in tables below . " We continue to be extremely pleased with our financial results for the second quarter and first half of 2021. Although not fully recovered , the Texas economy is rebounding very strongly from COVID effects and we've begun to refill our loan pipeline with increased demand across all loan types and regions . Our borrowers have shown strong resilience during this rebound , with many businesses having record years so far during 2021. Our non - performing assets as a percentage of total assets are very low at only 0.13 % . Almost all of our borrowers who received a COVID - related deferral are back on regular payment schedules with only a handful of credits remaining in an interest - only deferral period that will end in third quarter of 2021 as they also return to contractual payment schedules . As our second quarter results indicate , like all banks we have experienced some headwinds in our net interest margin and are seeing elevated loan pay downs , but we are confident in our ability to defend our net interest margin in this unprecedented rate environment and are encouraged with the size and strength of our loan pipeline as we enter the second half of 2021 , " commented Ty Abston , the Company's Chairman and Chief Executive Officer . QUARTERLY HIGHLIGHTS ☐ Solid Net Earnings and Core Earnings . Net earnings have remained consistent for the past four quarters . Net core earnings * , which exclude provisions for credit losses and income tax , net PPP income , and interest on PPP - related borrowings , have also remained solid over the last five quarters , illustrating a consistent core earnings stream . Net core earnings * were $ 9.4 million for the second quarter , compared to $ 9.8 million for the first quarter of 2021 , and $ 10.5 million during the second quarter of 2020 . ☐ Steady Net Interest Margin and Firm Loan Yields . The fully tax - equivalent ( “ FTE ” ) net interest margin , net of PPP effects , was 3.38 % for the second quarter of 2021 , compared to 3.48 % in the preceding quarter and 3.75 % in the second quarter of 2020. The decrease in the current quarter is primarily due to higher liquidity levels , which had a lower average yield during the quarter of only 6 basis points . Net interest income decreased $ 1.0 million , or 4.1 % , from $ 24.5 million in the first quarter of 2021 to $ 23.5 million in the second quarter of 2021. However , excluding the effects of PPP , net interest income increased $ 752,000 , or 3.6 % , from $ 21.0 million in the first quarter of 2021 to $ 21.7 million in the second quarter . Average loan yield , excluding PPP effects , increased three basis points , from 4.79 % in the first quarter to 4.82 % in the second quarter of 2021. Interest expense decreased $ 215,000 , or 10.6 % , from $ 2.0 million in the first quarter of 2021 to $ 1.8 million in second quarter of 2021. The Bank continues to decrease cost of funds as higher rate CDs mature and to reduce interest rates on non - maturing deposits as market conditions allow . In addition , 63.8 % of the loan portfolio , or $ 1.16 billion , has interest rate floors and 57.5 % of those loans are currently at their floors . The weighted average interest rate of loans currently at their floor is 4.37 % . Strong Credit Quality . Non - performing assets as a percentage of total assets were 0.13 % at June 30 , 2021 and March 31 , 2021 , compared to 0.56 % at June 30 , 2020. Net charge - offs to average loans ( annualized ) were 0.05 % for the quarter ended June 30 , 2021 , compared to 0.18 % for the quarter ended March 31 , 2021 , and ( 0.02 % ) for the quarter ended June 30 , 2020. The decrease in non - performing assets and the increase in charge - offs during the second quarter of 2021 compared to the same period of 2020 resulted primarily from the resolution of three problem loans , made to two borrowers , with outstanding combined book balances of $ 8.7 million at December 31 , 2020 , that were acquired during the Westbound acquisition and which were fully reserved prior to the onset of COVID - 19 . Paycheck Protection Program . The Bank continued participation in the PPP2 program through its end date in the second quarter of 2021. During the first half of 2021 , we originated total PPP2 loans of $ 100.8 million to 1,349 borrowers , which resulted in recognition of $ 3.3 million of net origination fees and related amortization for PPP2 loans during the first half of 2021. The Bank also recognized $ 1.8 million in PPP1 deferred origination fees during the first half of 2021 through both amortization and forgiveness of the related PPP1 loans . As of June 30 , 2021 , there are outstanding PPP1 balances of $ 26.6 million to 325 borrowers , a reduction of 87.3 % from the $ 209.6 million to 1,944 borrowers that was originated under the PPP1 program . Net deferred origination fees remaining as of June 30 , 2021 are $ 355,000 and $ 2.2 million from PPP1 and PPP2 , respectively . + Non - GAAP financial metric . Calculations of this metric and reconciliations to GAAP are included in the schedules accompanying this release .