Thank you for all of your support, as always. Please call us when we can be of service to you, your family and friends. Sincerely,

Transcription

1 2013 ANNUAL REPORT

2 If you re a sports fan, the end of the year is a very exciting time as you have the opportunity to experience the previous year s Best Plays, Best Shots, or Best Putts of your favorite sports team or golfer. Since our specialty is banking, we want to share our 2013 Top 5 Triumph Moments with you. As we continue to grow both in size and profitability, we predict our future Top 5 will be even more exciting than this year s. First, we are pleased to report to you a record 2013 after tax profit of $3,399,000 which is up 71% over our 2012 profit of $1,986,000. Increases of over 13% in loans and an increased profit margin on loans were key reasons for the large increase. Per share earnings were $0.83 and ROE (return on beginning equity) was 8.7%. Our short term goal is to get the ROE above 10% so we are progressing toward our goal. We are pleased with this profit as it demonstrates the convergence of a growing balance sheet, attention to operating expenses, and good asset quality. Another important note is this is our fifth year in a row to report a profit, and only one other Memphis based bank can say this. Second, our asset quality continues to be very good. Despite our rapid growth, we have been able to keep our asset quality expense (loan losses, losses on the sale of foreclosed properties and the legal expense of collecting loan balances) below 30/100 of 1%. This compares very favorably with our peers. Third, we ended the year with assets in excess of $430,000,000 and now have $500,000,000 in our sights. The $500,000,000 in assets is an important objective as our industry recognizes this as a different class of community bank. Fourth, on August 31, 2013, we purchased M&P Mortgage from Merchants & Planters Bank of Bolivar, TN. We merged this company into our own mortgage operation and named the combined operation Triumph Mortgage. The combined volume will be more than 10 times the previous pre-acquisition volume and also allows us to add additional mortgage products such as Jumbo Loans without Private Mortgage Insurance and very competitively priced Adjustable Rate Mortgages. Mortgage did not contribute to our income in 2013, but we expect it will have a favorable impact on our 2014 earnings. Fifth and finally, we opened our new Operations Center in May at Moriah Woods Office Park. This will help us increase efficiencies and allow for future growth of bank operations and administration. One negative this year was the value of our investment portfolio. Banks have investment portfolios to provide backup liquidity to fund loans. In 2013, the market value of our portfolio fell $800,000. Per GAAP accounting, we are required to report this loss as a reduction in Equity on the Balance Sheet, and it is not shown on the income statement. We normally purchase investments that have a shorter duration, higher credit quality and with a plan to hold until maturity. We expect some rebound in the market value of these assets as they mature, and since we plan on holding most until maturity, this should have a minimal effect on our equity over time. Our plan for 2014 is to increase loans and assets another 13-14% and exceed $500 million in Assets. We encourage you to refer business to us which will help us reach this goal. Thank you for all of your support, as always. Please call us when we can be of service to you, your family and friends. Sincerely, Hilliard R. Crews Chairman of the Board William J. Chase, Jr. President and Chief Executive Officer 1

3 $500,000,000 $500,000,000 $400,000,000 $400,000,000 $300,000,000 $300,000,000 TOTAL ASSETS $200,000,000 $100,000,000 NET LOANS $200,000,000 $100,000,000 $40,000,000 $400,000,000 SHAREHOLDERS EQUITY $30,000,000 $20,000,000 $10,000,000 TOTAL DEPOSITS & BORROWED FUNDS $300,000,000 $200,000,000 $100,000,000 NON INTEREST INCOME $1,500,000 $1,125,000 $750,000 $375,000 NET INCOME BEFORE TAXES $6,000,000 $4,500,000 $3,000,000 $1,500,000 2

4 Consolidated Balance Sheet Period Ending 12/31/2013 Assets Cash and Cash Equivalents 9,881,829 9,012,435 12,401,311 Securities Available for Sale 56,682,383 63,116,259 43,717,719 Loans Held for Sale 3,061,953 1,764, ,500 Loans, Net of Deferred Fees and Allowance for Loan Losses 354,929, ,627, ,289,209 Premises and Equipment, Net of Accumulated Depreciation 3,306,270 3,475,742 3,573,357 Other Assets 9,578,567 8,048,476 7,242,128 Total Assets 437,440, ,045, ,389,224 LIABILITIES AND SHAREHOLDERS EQUITY Deposits 380,257, ,221, ,592,184 Other Borrowings 13,000,000 18,000,000 6,600,000 Other Liabilities 2,188,077 1,530,214 1,430,248 Total Liabilities 395,445, ,751, ,622,432 Preferred Stock: 1,000,000 Shares Authorized Class A - 295,500 Shares Issued and Outstanding 3,546,000 3,546,000 Class B - 12,167 Shares Issued and Outstanding 146, ,004 Common Stock: 5,000,000 Shares Authorized 4,115,708 Shares Issued 4,115,708 3,629,311 2,279,311 4,072,108 Shares Outstanding Capital Surplus and Additional Paid-In Capital 35,126,606 31,846,582 21,030,259 Treasury Stock, 43,600 Shares Redeemed (490,500) (490,500) (490,500) Accumulated Other Comprehensive Income (677,881) 91,563 (290,106) Retained Earnings (Accumulated Deficit) 3,920, ,608 (1,454,176) Total Shareholders Equity 41,994,614 39,293,568 24,766,792 Total Liabilities and Shareholders Equity 437,440, ,045, ,389,224 3

5 Consolidated Income Statement Period Ending 12/31/2013 INTEREST INCOME Loan Interest Income 16,841,698 14,291,471 12,401,485 Fee Income 648, , ,689 Investment 1,210,595 1,209, ,658 Fed Funds Sold 9,665 20,212 20,034 Other Income 114,396 75,260 58,440 Total Interest and Fee Income 18,824,549 16,165,063 13,876,306 INTEREST EXPENSE Checking 957, , ,279 Savings 14,946 20,620 15,981 CD 1,622,239 1,937,211 2,361,413 Borrowed Funds 40, , ,771 Total Interest Expenses 2,634,790 3,043,114 3,388,444 Net Interest Income 16,189,759 13,121,949 10,487,862 Non-Interest Income 1,410, , ,723 NON-INTEREST EXPENSE Employee 6,006,723 5,060,613 3,818,621 Occupancy 1,151,371 1,046, ,752 F.F. & E. and D.P. 1,323,741 1,075, ,919 Other 2,295,383 2,136,289 2,384,269 Total Non-Interest Expenses 10,777,218 9,318,844 7,266,561 Allowance for Loan Losses 1,065,000 1,281,000 1,262,000 Net Income Before Taxes 5,758,171 3,331,006 2,581,024 Income Tax (Credit) 2,358,450 1,344,922 (545,000) Net Income 3,399,721 1,986,084 3,126,024 4

6 Confidence. Ability. Worth. A bank should be more about safeguarding your savings. It should help you reach your potential. Triumph offers a host of services that can do just that. Welcome to Triumph. Let s talk growth. Growth, without the growing pains. Your personal growth should be without limits. Without impediment. Triumph offers a suite of financial services that capitalize on your potential without ever slowing you down. Welcome to Triumph. Let s talk growth. triumphbank.com triumphmortgage.com (901) triumphbank.com triumphmortgage.com (901) Triumph is happy to announce that the Board of Directors recently adopted a new logo and brand message that is being rolled out throughout Let s talk growth reflects Triumph s focus of working side by side with its customers each day to help them reach their goals and experience growth. This growth can be demonstrated through helping them fund a new or existing business, earn a greater interest rate on their accounts and CDs, or through the purchase of a new home also brings enhanced technology to our customers, including a new Mobile App for all hand held devices featuring Mobile Capture for our consumer customers that allows remote depositing of checks. We are also proud to launch our new redesigned website Our new site offers more convenient navigation for Triumph customers to conduct their online banking and discover the features of additional accounts they may need. Let s talk growth also reflects inwardly as we are proud of the team of Triumph employees that demonstrate outstanding customer service and always strive to exceed your expectations. Triumph encourages them to grow and flourish in their careers because when we triumph, you triumph. Let s talk growth. 5

7 FINANCIAL SERVICES Commercial Lending Services Commercial Real Estate Loans Residential Real Estate Loans Accounts Receivable, Inventory, & Equipment Loans Small Business SBA Loans Consumer Lending Services Home Equity Lines of Credit Automobile Loans Loans for Personal Expenditures Mortgage Origination Loans Commercial Deposit Services Business Analysis Accounts Business Checking Business Savings Business Wealth Money Market Accounts Certificates of Deposit Business Remote Deposit Capture Lock Box Services Online Banking ACH & Wire Transfer Services Night Depository Business Credit Cards Business Bill Payment Positive Pay estatements Investment / Loan Sweep Consumer Deposit Services Complimentary Checking Performance Checking Prime Timer Checking Classic Savings Junior Banker Savings Consumer Wealth Money Market Accounts Certificates of Deposit Individual Retirement Accounts (IRAs) Online Banking & Bill Pay Services Mobile Banking Mobile Deposit Capture Telephone Banking Safe Deposit Boxes ATMs Including nationwide networks estatements BOARD OF DIRECTORS Hilliard R. Crews Chairman of the Board of Triumph Bancshares, Inc. Chairman, Shelby Group International, Inc. William J. Chase, Jr. President & CEO, Triumph Bank Michael J. McCarver EVP & COO, Triumph Bank A. Douglas Collins President & ceo, coldwell banker collins-maury, inc. realtors FOUNDER & CEO, SOVEREIGN HOMES, LLC. Jason L. Crews Chief Manager, Crews Realty, LLC Stephen T. Dunavant Senior Managing Director, CBIZ MHM Mark J. Halperin EVP & COO, Boyle Investment Company Joseph W. Mirabile, Ph.D. CEO, Mirabile Investment Corporation Larry W. Papasan Retired President of MLG&W, Smith & Nephew Orthopaedics David C. Perdue CEO, Asentinel Richard L. Powell Principal, HMP Insurance King W. Rogers, III Attorney of Counsel, Glankler Brown, PLLC Mitchell D. Spurlock Chairman, Aqua Chempacs Thomas G. Stovall, M.D., MBA Physician & Partner, Women s Health Specialists, Inc. Rick C. Masson Senior Director, Caissa Public Strategy Special Master, overseeing schools merger 6

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