FB Financial Corp (FBK)FBK

FB Financial Corp. - Comprehensive Overview

Last Updated: October 26, 2023

Disclaimer: This report is for informational purposes only and should not be considered financial advice. Please consult a qualified professional before making any investment decisions.

Company Profile:

Detailed History and Background:

• Founded in 1968 as First Bank, the company changed its name to FB Financial Corporation (FBK) in 2018.
• Headquartered in Murfreesboro, Tennessee, FBK serves customers through its three divisions: FirstBank, Insurance, and Mortgage Banking.
• It has expanded its footprint across Tennessee, North Carolina, Alabama, South Carolina, and Georgia through acquisitions and organic growth.

Core Business Areas:

• Banking: Provides a variety of financial services to individuals, businesses, and municipalities, including checking and savings accounts, loans, credit cards, investments, and treasury management services.
• Insurance: Offers auto, home, property, and life insurance products through its affiliated insurance agency.
• Mortgage Banking: Originates residential mortgage loans in its footprint states.

Leadership Team and Corporate Structure:

• Christopher Holmes: Chairman, President, and Chief Executive Officer
• Mark G. G. Myers: Executive Vice President, Chief Operating Officer
• William A. Bray: Executive Vice President, Chief Financial Officer
• Robert A. Palmer: Vice-Chairman and Executive Advisor
• Board of Directors: Composed of diverse individuals with extensive experience in business, finance, and law.

Top Products and Market Share:

• FirstBank: Holds the #1 share of deposits in all the core markets where they operate.
• Insurance: Strong regional presence.
• Mortgage Banking: Originated $2.67 billion of loans in the 12 months ended June 30, 2023.

Market Share Comparison:

• Deposit market share in Tennessee: 2.12%
• Auto loan market share in Tennessee: 3.67%
• Residential mortgage lending market share in its footprint states: 0.82%

Top Competitors:

• National and Regional Banks: Bank of America (BAC), Regions Financial (RF), Truist Financial (TFC), BB&T (BBT)
• Mortgage Lenders: Rocket Companies (RKT), United Wholesale Mortgage (UWMC), LoanDepot (LDI)
• Insurance Companies: State Farm, Allstate, Progressive, Geico

Total Addressable Market (2021):

• Banking: Over 220 million households in the United States, representing a $23 trillion addressable market.
• Auto loan market (US): Estimated at $1.6 trillion.
• Mortgage lending market (US): Estimated at $6 trillion.

Financial Performance:

Q2 2023 Highlights:

• Total assets: $6.6 billion
• Deposits: $5.7 billion
• Total loans: $4.7 billion
• Revenue: $147.93 million
• Net income: $27.17 million
• EPS: $1.11

Year-over-Year Comparisons:

• Revenue increased 6.3%
• Profits increased 24.4%
• Deposits increased 8.7%

Balance Sheet and Cash Flow Statement:

• Strong balance sheet with a capital adequacy ratio of 15.64%
• Positive net cash flow from operating activities

Earnings per Share and Dividends:

• Trailing Twelve Months (TTM) EPS: $5.07
• Recently paid a quarterly dividend of $0.30 per share
• Dividend payout ratio of approximately 60%

Growth Trajectory:

• Historical Revenue Growth: Average growth rate of 8% over the last 5 years (2018-2023).
• Future Growth Projections: Based on industry trends, company guidance, and future acquisition plans, projected growth rate of 10% for the next 5 years.

Recent Growth Initiatives:

• Continued expansion across existing markets
• Launching new digital banking features
• Investing in technological upgrades to improve customer experience

Market Dynamics:

• Positive: Rising interest rates benefiting banks with larger loan portfolios
• Challenges: Competition from fintech companies and potential economic slowdown

Key Challenges for FB Financial Corp

• Competition: Increasing competition from larger banks and fintech companies with disruptive technologies.
• Rising interest rates: Could lead to slower loan growth and increased cost of funds.
• Economic uncertainty: Potential economic slowdown could negatively impact customer spending and loan demand.

Key Opportunities for FB Financial Corp:

• Strong regional market position: Capitalize on its strong position in its core markets to further gain market share.
• Expansion into new markets: Continue to expand its footprint through strategic acquisitions and organic growth in new states.
• Digital innovation: Focus on developing new digital products and services to meet evolving customer needs.