Happy Bancshares, Inc. - Happy State Bank

Happy Bancshares, Inc. 2020 Annual Report

? MISSION STATEMENT ?

Work hard, have fun, make money, while providing outstanding customer service

and honoring the Golden Rule.

To Our Stockholders and Customers

2020... what an unpredictable year. While no one could have imagined the challenges, obstacles, disappointments and losses the year would bring, it gave us greater motivation to look for the silver lining and refocus on the things that matter most.

COVID-19 created struggles we never could have imagined and remains at the forefront of our minds. In March, our IT and Facilities teams helped relocate nearly 700 employees to home offices within four or five days ? something banks twice our size weren't able to do with such precision. Thanks to the creativity, flexibility and can-do attitudes of our Happy team, as well as a robust online account opening platform and the introduction of ITMs (our live teller ATMs), we have continued to meet the needs of our customers and bring a whole new meaning to the Happy experience.

Local businesses have been among those hardest hit, and Happy has been a great source of support during these difficult times, providing over 3,400 businesses with nearly $300 million in PPP loans and most being completely forgiven. Helping these businesses stay open and keep their folks employed is a true testimony of what it means to be a community bank.

Despite the pandemic, Happy State Bank had its best year yet. Here are several highlights we'd like to share: ? Stock Value ? While most banks saw their stock values plummet, ours increased $5.25 to $53.50/share ? HBI Earnings ? A record $50,529,000 ? Through virtual roadshows, we raised over $71 million in capital ? our second-best capital raise ever ? Pat passed the CEO reins to Mikel in April while remaining chairman of the board ? With $4.7 billion in deposits, $3.4 billion in loans and over $5.6 billion in assets, we are well-capitalized and

well-positioned for continued growth in 2021 ? Two completed acquisitions with two additional mergers announced ? Three de novo branches opened in Amarillo and two new LPO offices opened in Round Rock and Fort Worth ? With a 36.25% increase in revenue, a 37.89% increase in net income and $914 million in assets under management,

2020 was an outstanding year for Happy Trust Co. ? For the seventh year straight, American Banker named Happy State Bank one of its Best Banks to Work For,

ranking us #37 out of 5,000 banks across the nation

Through pandemics, elections, good days and bad, bountiful harvests and difficult seasons, one thing is certain. God is in control. As our guiding light and comforter, he celebrates and mourns with us. He has entrusted us to be good stewards of the resources he has bestowed upon us through Happy State Bank, and we do not take that responsibility lightly.

We look forward to serving our many friends and neighbors for many years to come.

Pat & Mikel

J. Pat Hickman, Chairman

Mikel Williamson, President & CEO

$5 Billion

$6 Billion $4 Billion

Financials $5 Billion $3 Billion

$64 Billion $2 Billion

Loans Deposits Assets Loans Deposits

$53 Billion $1 Billion

$42 Billion $0

$31 Billion

Assets

$2 Billio$n0

Loans Deposits Assets

$1 Billion $0

CAGR* 7 Years

Loans

11.54%

De osits 11.84%

HACBsAIseGHtsRI*STOR712YI.6Ce8a%rGs ROWTH

Loans De osits Assets

11.54% 11.84% 12.68%

CAGR* 7 Years

Loans

11.54%

De osits 11.84%

201A3 ssets 201412.68% 2015

2016

2013

2014

2015

2016

2017 2017

2018

2019

2020

*Com ound Annual Growth Rate

2018

2019

2020

*Com ound Annual Growth Rate

2013

2014

2015

2016

2017

2018

2019

2020

HBI HISTORIC EARNINGS & EARNINGS PER SHAR*CEom ound Annual Growth Rate

Total Earnin s in Millions Earnin s TeortSahl are Earnin s in Millions Earnin s

er Share Total Earnin s in Millions Earnin s

er Share

Book Value Tan ible Book Value 3BrdooPkarVtalue Valuation Tan ible Book Value 3rd Part VBaoloukatVioanlue

$60.00 $55.00 $50.00 $45.00 $$4600..0000 $$3555..0000 $$3500..0000 $$2455..0000 $$$$$$$$$$$$$$211$65544433221050505050050505...............0000$000000000000000000000000000 $$3150..0000 $3$05..0000 $25.0$00 $20.00 $15.00 $10.00

$5.00 $0

HBI HISTORIC EARNINGS & EARNINGS PER SHARE

$42.010

$31.814

HBI

HISTORIC

EARNING$S28.&004EARNINGS

$24.660

$24.625

PER

SHARE$42.010

$16.213

$18.788

$1.36 $16.213

2013

$18.788$1.39

2014

$1.36

$1.39

$24.660 $1.74

2015

$24.660$1.74

$28.004 $1.86

2016

$28.004$1.86

$24.625 $1.56

2017

$24.625$1.56

$31.814

$1.89

2018

$31.814 $1.89

$42.010$2.38

2019

$2.38

$162.201313

$182.708814

2015

2016

2017

2018 2019

$1.36

$1.39

$1.74

H20B13I STOC2K014VALUE20S15

$1.86

2016

$1.56

2017

$1.89

2018

$2.38

2019

$50.529

$50.529

$50.529 $2.72

2020

$2.72

2020

$2.72

2020

$60.00

$55.00

$50.00

$$4650..0000

$$4505..0000

$$3550..0000

$$3405..0000 $$$264500...000000 $$$253055...000000 $$$153500...000000 $$$142055...000000 $$$42500...000000 $$3155..$00000 $$3100..0000 $2$55..0000 $20.0$00 $15.00

H7ABYnenIauSraTlizOedCRKetuVrnALUES

12.99%

2020 Increase

170Y.e8a8r %

Annualized Return

H1B2I.9S9T%OCK VALUES

2020 Increase

10.88%

7 Year Annualized Return

12.99%

2020 Increase

10.88%

2013

2014

2015

2013

2014

2015

2016 2016

2017 2017

$53.50 $53.50 $53.50

2018

2019

2020

Dividend Ad usted Share Price

2018

2019

2020

HAPPY BANCSHARES, INC. Statement of Condition

BALANCE SHEET

(Dollars in thousands)

2018

ASSETS Cash & Due from Banks Investments Loans Fixed Assets Other Assets TOTAL ASSETS

$ 181,478 580,870

2,352,080 111,265 220,688

3,446,381

LIABILITIES Deposits Other Liabilities TOTAL LIABILITIES

2,813,600 171,458

2,985,058

CAPITAL

Common Stock Capital Surplus Retained Earnings Accumulated other comprehensive income

18,086 241,217 208,102 (6,082)

TOTAL CAPITAL

461,323

TOTAL LIABILITIES & EQUITY CAPITAL

$ 3,446,381

2019

$ 219,746 692,467

2,612,576 115,662 188,837

3,829,288

3,040,314 253,426

3,293,740

18,593 260,467 250,030

6,458 535,548

$ 3,829,288

2020

$ 721,207 986,958

3,441,128 157,076 334,562

5,640,931

4,685,660 286,631

4,972,291

19,838 317,732 300,559

30,511 668,640

$ 5,640,931

Change from 2019 to 2020

228% 43% 32% 36% 77% 47%

54% 13% 51%

7% 22% 20% 372% 25%

47%

INCOME STATEMENT

(Dollars in thousands)

NET INTEREST INCOME Interest Income Interest Expense

Provision for Loan Losses NON INTEREST INCOME

Service Charges Other Non Interest Income

NON INTEREST EXPENSE Salaries and Employee Benefits Occupancy and Equipment Expense, Net Data Processing Other

Net Income before Tax Income Tax NET INCOME

2018

$ 147,387 27,592

119,795 6,300

17,482 15,974 33,456

66,076 12,850 6,939 25,864 111,792 35,222 3,408 $ 31,814

2019

$ 164,171 34,718

129,453 8,650

18,816 24,710 43,526

68,385 14,221 7,871 24,048 114,525 49,804 7,794 $ 42,010

2020

$ 197,151 22,481

174,670 23,350

20,548 32,938 53,846

87,736 16,662 10,275 28,979 143,652 61,154 10,625 $ 50,529

Change from 2019 to 2020

20% -35% 35% 170%

9% 33% 23%

28% 17% 31% 21% 25% 23% 36% 20%

Growing Our Community

2020 was a year of growth for Happy State Bank. In January, First State Bank of Mobeetie joined Happy with locations in Mobeetie and Wheeler. Over the summer, Happy opened three new branches in Amarillo ? Teckla, I40 & Grand and NE 24th & Grand. With two additional locations serving Northeast Amarillo, Happy can give our neighbors more convenient access to banking and credit services. In November, the Centennial BANK acquisition was completed ? the largest to date ? growing Happy's footprint to a total of 57 branches in 41 communities across the Texas Panhandle, South Plains, Austin, Central Texas and the Dallas/Fort Worth Metroplex. With the addition of two new loan production offices in Round Rock and Fort Worth, Happy is well-positioned to serve our thriving business community's lending needs. In late 2020, Happy announced two additional mergers slated for 2021 ? First Bank of Muleshoe, with locations in Muleshoe, Dimmitt and Bovina, and First National Bank of Tahoka, with one location in Tahoka. Happy Investments at Happy State Bank welcomed the Murphy Team. The addition brings two new offices, with one in Guymon, Oklahoma ? Happy's first location outside of Texas.

Reported Volunteer Hours = 4,045 Organizations Served = 280

Due to COVID-19, volunteering in 2020 looked quite a bit different for many in our communities. However, in typical Happy fashion, our folks figured out new and different ways to serve others during a pandemic. From providing first responders with meals to safely participating in organized events and community fundraisers, the Happy family showed up to lend a helping hand.

Board of Directors | Happy Bancshares, Inc. | Happy State Bank

Our Board of Directors acts as advisor and counselor to senior executives and ensures that our high ethical standards are an essential element of, and reflected in, our everyday culture.

J. Pat Hickman Chairman

Matthew Bumstead Bill Jennings

Nancy Gaitan-Kernell Mike H. Kuhlman Frank O. Marrs Drayton McLane Jr. Drayton McLane III

Ginger Nelson George Bailey Peyton, IV

J. Brian Sims, M.D. Trent Sisemore Brian L. Vincent

Victor "Vic" A. Weir, II J. David Williams Mikel Williamson John Zwiacher

Executive Leadership | Happy State Bank

Mikel Williamson President & CEO Eric Alexander Chief Financial Officer Kayla Carpenter

Chief of Staff Wendi Costlow

Marketing Ross Glenn Special Assets Robert Gottlich Corporate Banking David Jones General Counsel

Scott Lewis Senior Credit Officer

Renee McNeely Human Resources

Connie Ratliff Enterprise Risk Management

Alberto Rios Chief Operating Officer

David Smith Acquisitions

Alan VanOngevalle Other Financial Services

Branch Locations

100 E. Main | P.O. Box 68 | Happy, Texas 79042 (800) 447-BANK | (806) 358-5100

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download