First Foundation Investor Presentation Deck
Non-GAAP Return on Average Tangible Common Equity
(ROATCE), Adjusted Return on Average Assets and Net Income
Return on average tangible common equity was calculated by excluding average goodwill and intangibles assets from the average shareholders' equity during the
associated periods. Adjusted return on average assets represents adjusted net income attributable to common shareholders divided by average total assets.
Adjusted net income attributable to common shareholders includes various adjustments to net income, including an adjustment for non-cash goodwill impairment
charges, and any associated tax effect of those adjustments during the associated periods.
The table below provides a reconciliation of the GAAP measure of return on average equity to the non-GAAP measure of return on average tangible common equity.
The table below also provides a reconciliation of the GAAP measure of net (loss) income to the non-GAAP measure of adjusted net income attributable to common
shareholders. The table below also provides a reconciliation of the GAAP measure of return on average assets to the non-GAAP measure of adjusted return on
average assets:
($ in thousands)
Unaudited
Average shareholders' equity
Less: Average goodwill and intangible assets
Average tangible common equity
Average total assets
Net Income
Add: Goodwill impairment
Adjustments:
Plus: Amortization of intangible assets expense
Plus/(Less): Merger related costs
Plus: Professional service costs
Plus: Valuation loss on equity investment
Plus: Severance costs
Less: Incentive compensation reversal
Less: Stock compensation reversal
Less: FDIC insurance expense refund
Total Adjustments
Less: Tax effect on adjustments
Adjusted Net Income (loss) available to common shareholders
Tax rate utilized for calculating tax effect on adjustments
Return on average equity(¹)
Return on average tangible common equity (2)
Return on average assets (³)
Adjusted return on average assets (4) (5)
1)
2)
3)
$ 474,256 $
69,177
$ 405,080 $
$
FY 2018
$
42,958 $
5,300,243 6,156,739
2,043
2,043
(592)
29%
FY 2019
9.1%
11.0%
585,728 $
98,291
487,437 $
0.81%
0.84%
56,239 $
(664)
44,408 $ 57,866 $
2,291
2,291
29%
9.6%
11.9%
0.91%
0.94%
FY 2020
649,031 $
96,209
552,823 $
6,690,422
84,369 $
1,895
29%
13.0%
15.5%
FY 2021
1.26%
1.28%
7,733,279
1,895
1,579
(550)
(458)
85,714 $ 110,632 $
759,101 $ 1,100,684 $ 1,080,696 $ 1,102,811
104,355 222,393
190,653
654,746 $ 878,291 $
912,158
222,547
858,149 $
109,511 $ 110,512 $
1,579
Annualized net income divided by average shareholders' equity.
Annualized adjusted net income available to common shareholders divided by average tangible common equity.
Annualized net income divided by average assets.
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29%
FY 2022
14.4%
16.9%
1.42%
1.43%
11,456,932 10,616,648
1,914
(36)
971
6,250
(4,150)
28%
Six Months Ended,
6/30/2022
10.0%
13.0%
0.96%
1.00%
4,949
965
(280)
(1,400)
114,061 $ 64,837 $
4)
5)
64,152 $
1,000
(35)
29%
11.9%
15.1%
6/30/2023
1.21%
1.22%
13,222,955
(203,792)
215,252
853
1,124
748
(1,118)
(724)
883
(247)
12,095
28%
-37.0%
2.7%
-3.08%
0.18%
Annualized adjusted net income divided by average assets.
Use of Non-GAAP measure.
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