Exhibit 99.1
MUFG Americas Holdings Corporation
A member of MUFG, a global financial group
FOR IMMEDIATE RELEASE (July 25, 2016)
Contact: | Alan Gulick | Doug Lambert | ||||
Corporate Communications | Investor Relations | |||||
(425) 423-7317 | (212) 782-5911 |
MUFG AMERICAS HOLDINGS CORPORATION REPORTS SECOND QUARTER NET INCOME OF $305 MILLION
NEW YORK - MUFG Americas Holdings Corporation ("MUAH" or "the Company"), parent company of San Francisco-based MUFG Union Bank, N.A. ("the Bank"), today reported net income for the quarter of $305 million, compared with $49 million for the prior quarter and $181 million for the year-ago quarter.
Highlights:
◦ | Net income for the second quarter was $305 million, up $256 million from the first quarter of 2016. |
◦ | Total revenue was up $94 million while noninterest expense was down $66 million compared with the first quarter of 2016. |
◦ | The reversal of provision for credit losses was $37 million compared with a provision for credit losses of $162 million in the first quarter of 2016. |
◦ | Average loans held for investment during the second quarter of 2016 were $79.9 billion, up $1.5 billion from the first quarter of 2016. |
◦ | Mitsubishi UFJ Financial Group, Inc. designated MUAH as its Intermediate Holding Company ("IHC") in accordance with the requirements of the U.S. Federal Reserve Board's final rules for Enhanced Prudential Standards and transferred substantially all interests in its U.S. subsidiaries to the IHC on July 1, 2016. The subsidiaries include MUFG Securities Americas, Inc. (formerly Mitsubishi UFJ Securities (USA), Inc.), a registered broker-dealer, and various other non-bank subsidiaries with approximately $36 billion in total assets as of March 31, 2016. |
1 |
The following table presents financial highlights for the periods ended June 30, 2016, March 31, 2016 and June 30, 2015:
Percent Change to | ||||||||||||||||||
As of and for the Three Months Ended | June 30, 2016 from | |||||||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | June 30, 2015 | March 31, 2016 | June 30, 2015 | |||||||||||||
Results of operations: | ||||||||||||||||||
Net interest income | $ | 720 | $ | 697 | $ | 719 | 3 | % | — | % | ||||||||
Noninterest income | 466 | 395 | 385 | 18 | 21 | |||||||||||||
Total revenue | 1,186 | 1,092 | 1,104 | 9 | 7 | |||||||||||||
Noninterest expense | 810 | 876 | 843 | (8 | ) | (4 | ) | |||||||||||
Pre-tax, pre-provision income (1) | 376 | 216 | 261 | 74 | 44 | |||||||||||||
(Reversal of) provision for credit losses | (37 | ) | 162 | 15 | (123 | ) | (347 | ) | ||||||||||
Income before income taxes and including | ||||||||||||||||||
noncontrolling interests | 413 | 54 | 246 | nm | 68 | |||||||||||||
Income tax expense | 119 | 17 | 71 | nm | 68 | |||||||||||||
Net income including noncontrolling interests | 294 | 37 | 175 | nm | 68 | |||||||||||||
Deduct: Net loss from noncontrolling interests | 11 | 12 | 6 | (8 | ) | 83 | ||||||||||||
Net income attributable to | ||||||||||||||||||
MUFG Americas Holdings Corporation (MUAH) | $ | 305 | $ | 49 | $ | 181 | nm | 69 | ||||||||||
Balance sheet (period average): | ||||||||||||||||||
Total assets | $ | 116,281 | $ | 115,866 | $ | 112,907 | — | 3 | ||||||||||
Total securities | 23,259 | 23,507 | 22,915 | (1 | ) | 2 | ||||||||||||
Total loans held for investment | 79,934 | 78,450 | 76,751 | 2 | 4 | |||||||||||||
Earning assets | 105,150 | 104,888 | 102,289 | — | 3 | |||||||||||||
Total deposits | 83,663 | 84,010 | 82,147 | — | 2 | |||||||||||||
MUAH stockholder's equity | 15,918 | 15,687 | 15,238 | 1 | 4 | |||||||||||||
Net interest margin (3) (7) | 2.77 | % | 2.69 | % | 2.84 | % | ||||||||||||
Balance sheet (end of period): | ||||||||||||||||||
Total assets | $ | 117,156 | $ | 120,909 | $ | 114,266 | (3 | ) | 3 | |||||||||
Total securities | 23,105 | 23,616 | 24,287 | (2 | ) | (5 | ) | |||||||||||
Total loans held for investment | 79,392 | 79,299 | 76,399 | — | 4 | |||||||||||||
Core deposits (2) | 75,296 | 74,882 | 73,080 | 1 | 3 | |||||||||||||
Total deposits | 82,692 | 89,500 | 81,702 | (8 | ) | 1 | ||||||||||||
Long-term debt | 10,445 | 11,843 | 8,852 | (12 | ) | 18 | ||||||||||||
MUAH stockholder's equity | 16,179 | 15,758 | 15,260 | 3 | 6 | |||||||||||||
Refer to Exhibit 16 for footnote explanations.
2 |
Summary of Second Quarter Results
Second Quarter Total Revenue
For the second quarter of 2016, total revenue (net interest income plus noninterest income) was $1.2 billion, up $94 million from the first quarter of 2016. Net interest income for the second quarter of 2016 was $720 million, up $23 million compared with the first quarter of 2016 due to an increase in loans held for investment and the net interest margin. The net interest margin increased 8 basis points to 2.77%, reflecting higher yields on securities and a favorable change in the mix of borrowed funds. Average total deposits were $83.7 billion, down slightly compared with the first quarter of 2016.
For the second quarter of 2016, noninterest income was $466 million, up $71 million, or 18%, compared with the first quarter of 2016, largely due to an increase in fees from affiliates in the current quarter and impairments on oil and gas-related private equity investments in the prior quarter.
Compared with the second quarter of 2015, total revenue increased $82 million, substantially due to increases in fees from affiliates and securities gains and a decrease in FDIC indemnification asset amortization expense.
Second Quarter Noninterest Expense
Noninterest expense for the second quarter of 2016 was $810 million, down $66 million compared with the first quarter of 2016 and down $33 million from the second quarter of 2015. The decrease from the first quarter of 2016 was due primarily to decreases in salaries and employee benefits and professional and outside services.
Compared with the second quarter of 2015, the decrease in noninterest expense was largely due to a decrease in salaries and employee benefits expense and a contract termination fee in the second quarter of 2015.
The effective tax rate for the second quarter of 2016 was 28.8%, compared with an effective tax rate of 31.5% for the first quarter of 2016.
3 |
Business Integration Initiative - Second Quarter Summary Impact(14)
For the quarters ended June 30, 2016, March 31, 2016 and June 30, 2015, the Company recorded the following fee income and costs related to support services:
For the Three Months Ended | ||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | June 30, 2015 | |||||||||
Fees from affiliates - support services | $ | 147 | $ | 149 | $ | 134 | ||||||
Staff costs associated with fees from | ||||||||||||
affiliates - support services | $ | 137 | $ | 139 | $ | 123 | ||||||
__________________________
Refer to Exhibit 16 for footnote explanations.
The Company also recognized fees from affiliates through revenue sharing agreements with BTMU for various business and banking services.
Balance Sheet
At June 30, 2016, total assets were $117.2 billion, down $3.7 billion from the prior quarter. Cash and cash equivalents and total deposits were down $4.5 billion and $6.8 billion, respectively, compared with the prior quarter-end, due primarily to a single short-term deposit at the previous quarter-end. Core deposits were up $414 million, compared with the prior quarter-end.
4 |
Credit Quality
The following table presents credit quality data for the quarters ended June 30, 2016, March 31, 2016 and June 30, 2015:
As of and for the Three Months Ended | |||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | June 30, 2015 | ||||||||||
Total (reversal of) provision for credit losses | $ | (37 | ) | $ | 162 | $ | 15 | ||||||
Net loans charged-off | 98 | 4 | 20 | ||||||||||
Nonaccrual loans | 632 | 956 | 362 | ||||||||||
Criticized loans held for investment (12) | 2,859 | 3,066 | 1,395 | ||||||||||
Credit Ratios: | |||||||||||||
Allowance for loan losses to: | |||||||||||||
Total loans held for investment | 0.94 | % | 1.11 | % | 0.70 | % | |||||||
Nonaccrual loans | 118.24 | 91.99 | 147.98 | ||||||||||
Allowance for credit losses to (13): | |||||||||||||
Total loans held for investment | 1.15 | 1.32 | 0.89 | ||||||||||
Nonaccrual loans | 144.50 | 109.68 | 188.39 | ||||||||||
Nonaccrual loans to total loans held for investment | 0.80 | 1.21 | 0.47 | ||||||||||
____________________________________
Refer to Exhibit 16 for footnote explanations.
In the second quarter of 2016, the reversal of provision for credit losses was $37 million, compared with a provision of $162 million for the first quarter of 2016 and a provision of $15 million for the second quarter of 2015. The change in the provision for credit losses from the first quarter of 2016 reflects stabilization in the credit quality of the oil and gas sector of our loan portfolio and improving credit quality elsewhere in the commercial portfolio. As of June 30, 2016, our oil and gas commitments were comprised of 78% petroleum exploration and production ("PEP") companies, of which 77% were reserve-based loans. Reserve-based lending typically consists of loans collateralized with oil and gas reserves.
Criticized loans outstanding within the PEP portfolio declined $128 million during the second quarter of 2016 largely due to transfers to held for sale and charge-offs. The Company recorded net charge-offs of $98 million, substantially related to PEP loans. $51 million of the charge-offs resulted from the transfer of certain PEP loans to held for sale. The following table provides further information about our petroleum exploration and production loan portfolio:
5 |
As of | ||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | December 31, 2015 | |||||||||
Petroleum Exploration and Production: | ||||||||||||
Loan commitments | $ | 4,529 | $ | 5,519 | $ | 5,768 | ||||||
Loans outstanding | 2,434 | 3,080 | 2,943 | |||||||||
Criticized commitments | 2,541 | 2,701 | 2,156 | |||||||||
Criticized outstanding | 1,577 | 1,705 | 1,226 | |||||||||
Allowance for credit losses | 320 | 415 | 319 | |||||||||
Allowance for loan losses | 287 | 386 | 291 |
Capital
The following table presents capital ratio data as of June 30, 2016 and March 31, 2016:
June 30, 2016 | March 31, 2016 | |||||
Capital ratios: | ||||||
Regulatory: | U.S. Basel III | |||||
Common Equity Tier 1 risk-based capital ratio (8) (9) | 13.63 | % | 13.33 | % | ||
Tier 1 risk-based capital ratio (8) (9) | 13.63 | 13.33 | ||||
Total risk-based capital ratio (8) (9) | 15.48 | 15.32 | ||||
Tier 1 leverage ratio (8) (9) | 11.62 | 11.41 | ||||
Other: | ||||||
Tangible common equity ratio (10) | 11.27 | % | 10.55 | % | ||
Common Equity Tier 1 risk-based capital ratio (U.S. Basel III standardized approach; fully phased-in) (8) (11) | 13.61 | 13.31 | ||||
____________________________________
Refer to Exhibit 16 for footnote explanations.
The Company’s stockholder’s equity was $16.2 billion at June 30, 2016, compared with $15.8 billion at March 31, 2016.
The Company's preliminary Common Equity Tier 1, Tier 1 and Total risk-based capital ratios, calculated in accordance with U.S. Basel III regulatory capital rules, were 13.63%, 13.63% and 15.48%, respectively, at June 30, 2016. The tangible common equity ratio was 11.27% at June 30, 2016.
The Company’s estimated Common Equity Tier 1 risk-based capital ratio under U.S. Basel III regulatory capital rules (standardized approach, fully phased-in) was 13.61% at June 30, 2016.
6 |
Non-GAAP Financial Measures
This press release includes additional capital ratios (tangible common equity and Common Equity Tier 1 capital (calculated under the U.S. Basel III standardized approach on a fully phased-in basis)) to facilitate the understanding of the Company’s capital structure and for use in assessing and comparing the quality and composition of the Company's capital structure to that of other financial institutions. These presentations should not be viewed as a substitute for results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP financial measures presented by other companies. Please refer to our separate reconciliation of non-GAAP financial measures in our financial supplement.
About MUFG Americas Holdings Corporation
Headquartered in New York, MUFG Americas Holdings Corporation is a financial holding company and bank holding company with total assets of $117.2 billion at June 30, 2016. Its principal subsidiary, MUFG Union Bank, N.A., provides an array of financial services to individuals, small businesses, middle-market companies, and major corporations. As of June 30, 2016, MUFG Union Bank, N.A. operated 366 branches, comprised primarily of retail banking branches in the West Coast states, along with commercial branches in Texas, Illinois, New York and Georgia, as well as two international offices. MUFG Americas Holdings Corporation is owned by The Bank of Tokyo-Mitsubishi UFJ, Ltd. and Mitsubishi UFJ Financial Group, Inc., one of the world’s leading financial groups. The Bank of Tokyo-Mitsubishi UFJ, Ltd. is a wholly-owned subsidiary of Mitsubishi UFJ Financial Group, Inc. Visit www.unionbank.com or www.mufgamericas.com for more information.
###
7 |
MUFG Americas Holdings Corporation and Subsidiaries
Financial Highlights (Unaudited)
Percent Change to | |||||||||||||||||||||||||||
As of and for the Three Months Ended | June 30, 2016 from | ||||||||||||||||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | December 31, 2015 | September 30, 2015 | June 30, 2015 | March 31, 2016 | June 30, 2015 | ||||||||||||||||||||
Results of operations: | |||||||||||||||||||||||||||
Net interest income | $ | 720 | $ | 697 | $ | 708 | $ | 705 | $ | 719 | 3 | % | — | % | |||||||||||||
Noninterest income | 466 | 395 | 413 | 397 | 385 | 18 | 21 | ||||||||||||||||||||
Total revenue | 1,186 | 1,092 | 1,121 | 1,102 | 1,104 | 9 | 7 | ||||||||||||||||||||
Noninterest expense | 810 | 876 | 891 | 855 | 843 | (8 | ) | (4 | ) | ||||||||||||||||||
Pre-tax, pre-provision income (1) | 376 | 216 | 230 | 247 | 261 | 74 | 44 | ||||||||||||||||||||
(Reversal of) provision for credit losses | (37 | ) | 162 | 192 | 18 | 15 | (123 | ) | (347 | ) | |||||||||||||||||
Income before income taxes and including | |||||||||||||||||||||||||||
noncontrolling interests | 413 | 54 | 38 | 229 | 246 | nm | 68 | ||||||||||||||||||||
Income tax expense | 119 | 17 | (18 | ) | 64 | 71 | nm | 68 | |||||||||||||||||||
Net income including noncontrolling interests | 294 | 37 | 56 | 165 | 175 | nm | 68 | ||||||||||||||||||||
Deduct: Net loss from noncontrolling interests | 11 | 12 | 13 | 21 | 6 | (8 | ) | 83 | |||||||||||||||||||
Net income attributable to | |||||||||||||||||||||||||||
MUFG Americas Holdings Corporation (MUAH) | $ | 305 | $ | 49 | $ | 69 | $ | 186 | $ | 181 | nm | 69 | |||||||||||||||
Balance sheet (end of period): | |||||||||||||||||||||||||||
Total assets | $ | 117,156 | $ | 120,909 | $ | 116,216 | $ | 115,157 | $ | 114,266 | (3 | ) | 3 | ||||||||||||||
Total securities | 23,105 | 23,616 | 24,502 | 24,696 | 24,287 | (2 | ) | (5 | ) | ||||||||||||||||||
Total loans held for investment | 79,392 | 79,299 | 77,599 | 76,641 | 76,399 | — | 4 | ||||||||||||||||||||
Core deposits (2) | 75,296 | 74,882 | 76,094 | 74,785 | 73,080 | 1 | 3 | ||||||||||||||||||||
Total deposits | 82,692 | 89,500 | 84,340 | 82,693 | 81,702 | (8 | ) | 1 | |||||||||||||||||||
Long-term debt | 10,445 | 11,843 | 12,349 | 11,357 | 8,852 | (12 | ) | 18 | |||||||||||||||||||
MUAH stockholder's equity | 16,179 | 15,758 | 15,461 | 15,603 | 15,260 | 3 | 6 | ||||||||||||||||||||
Balance sheet (period average): | |||||||||||||||||||||||||||
Total assets | $ | 116,281 | $ | 115,866 | $ | 115,914 | $ | 113,451 | $ | 112,907 | — | 3 | |||||||||||||||
Total securities | 23,259 | 23,507 | 24,351 | 24,141 | 22,915 | (1 | ) | 2 | |||||||||||||||||||
Total loans held for investment | 79,934 | 78,450 | 77,832 | 76,177 | 76,751 | 2 | 4 | ||||||||||||||||||||
Earning assets | 105,150 | 104,888 | 104,966 | 102,899 | 102,289 | — | 3 | ||||||||||||||||||||
Total deposits | 83,663 | 84,010 | 84,033 | 82,488 | 82,147 | — | 2 | ||||||||||||||||||||
MUAH stockholder's equity | 15,918 | 15,687 | 15,722 | 15,435 | 15,238 | 1 | 4 | ||||||||||||||||||||
Performance ratios: | |||||||||||||||||||||||||||
Return on average assets (3) | 1.05 | % | 0.17 | % | 0.24 | % | 0.66 | % | 0.64 | % | |||||||||||||||||
Return on average MUAH stockholder's equity (3) | 7.65 | 1.25 | 1.75 | 4.83 | 4.73 | ||||||||||||||||||||||
Return on average assets excluding the impact of privatization | |||||||||||||||||||||||||||
transaction and merger costs related to acquisitions (3) (4) | 1.09 | 0.18 | 0.27 | 0.70 | 0.67 | ||||||||||||||||||||||
Return on average MUAH stockholder's equity excluding the | |||||||||||||||||||||||||||
impact of privatization transaction and merger costs related to | |||||||||||||||||||||||||||
acquisitions (3) (4) | 8.96 | 1.54 | 2.24 | 5.82 | 5.69 | ||||||||||||||||||||||
Efficiency ratio (5) | 68.42 | 80.17 | 79.51 | 77.62 | 76.42 | ||||||||||||||||||||||
Adjusted efficiency ratio (6) | 61.13 | 72.12 | 69.42 | 70.16 | 69.02 | ||||||||||||||||||||||
Net interest margin (3) (7) | 2.77 | 2.69 | 2.72 | 2.76 | 2.84 | ||||||||||||||||||||||
Capital ratios: | |||||||||||||||||||||||||||
Regulatory: | U.S. Basel III | ||||||||||||||||||||||||||
Common Equity Tier 1 risk-based capital ratio (8) (9) | 13.63 | % | 13.33 | % | 13.63 | % | 13.84 | % | 13.56 | % | |||||||||||||||||
Tier 1 risk-based capital ratio (8) (9) | 13.63 | 13.33 | 13.64 | 13.84 | 13.56 | ||||||||||||||||||||||
Total risk-based capital ratio (8) (9) | 15.48 | 15.32 | 15.56 | 15.60 | 15.30 | ||||||||||||||||||||||
Tier 1 leverage ratio (8) (9) | 11.62 | 11.41 | 11.40 | 11.58 | 11.46 | ||||||||||||||||||||||
Other: | |||||||||||||||||||||||||||
Tangible common equity ratio (10) | 11.27 | % | 10.55 | % | 10.71 | % | 10.93 | % | 10.70 | % | |||||||||||||||||
Common Equity Tier 1 risk-based capital ratio (U.S. Basel III standardized approach; fully phased-in) (8) (11) | 13.61 | 13.31 | 13.46 | 13.79 | 13.49 | ||||||||||||||||||||||
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 1 |
MUFG Americas Holdings Corporation and Subsidiaries
Financial Highlights (Unaudited)
As of and for the Six Months Ended | Percent Change to | |||||||||||||
June 30, | June 30, | June 30, 2016 from | ||||||||||||
(Dollars in millions) | 2016 | 2015 | June 30, 2015 | |||||||||||
Results of operations: | ||||||||||||||
Net interest income | $ | 1,417 | $ | 1,402 | 1 | % | ||||||||
Noninterest income | 861 | 720 | 20 | |||||||||||
Total revenue | 2,278 | 2,122 | 7 | |||||||||||
Noninterest expense | 1,686 | 1,692 | — | |||||||||||
Pre-tax, pre-provision income (1) | 592 | 430 | 38 | |||||||||||
Provision for credit losses | 125 | 18 | nm | |||||||||||
Income before income taxes and including | ||||||||||||||
noncontrolling interests | 467 | 412 | 13 | |||||||||||
Income tax expense | 136 | 105 | 30 | |||||||||||
Net income including noncontrolling interests | 331 | 307 | 8 | |||||||||||
Deduct: Net loss from noncontrolling interests | 23 | 11 | 109 | |||||||||||
Net income attributable to MUAH | $ | 354 | $ | 318 | 11 | |||||||||
Balance sheet (end of period): | ||||||||||||||
Total assets | $ | 117,156 | $ | 114,266 | 3 | |||||||||
Total securities | 23,105 | 24,287 | (5 | ) | ||||||||||
Total loans held for investment | 79,392 | 76,399 | 4 | |||||||||||
Core deposits (2) | 75,296 | 73,080 | 3 | |||||||||||
Total deposits | 82,692 | 81,702 | 1 | |||||||||||
Long-term debt | 10,445 | 8,852 | 18 | |||||||||||
MUAH stockholder's equity | 16,179 | 15,260 | 6 | |||||||||||
Balance sheet (period average): | ||||||||||||||
Total assets | $ | 116,074 | $ | 113,020 | 3 | |||||||||
Total securities | 23,383 | 22,546 | 4 | |||||||||||
Total loans held for investment | 79,193 | 77,026 | 3 | |||||||||||
Earning assets | 105,020 | 102,443 | 3 | |||||||||||
Total deposits | 83,836 | 83,112 | 1 | |||||||||||
MUAH stockholder's equity | 15,804 | 15,154 | 4 | |||||||||||
Performance ratios: | ||||||||||||||
Return on average assets (3) | 0.61 | % | 0.56 | % | ||||||||||
Return on average MUAH stockholder's equity (3) | 4.48 | 4.19 | ||||||||||||
Return on average assets excluding the impact of privatization transaction and merger costs related to acquisitions (3) (4) | 0.64 | 0.60 | ||||||||||||
Return on average MUAH stockholders' equity excluding the impact of privatization transaction and merger costs related to acquisitions (3) (4) | 5.29 | 5.10 | ||||||||||||
Efficiency ratio (5) | 74.06 | 79.75 | ||||||||||||
Adjusted efficiency ratio (6) | 66.39 | 71.86 | ||||||||||||
Net interest margin (3) (7) | 2.73 | 2.77 | ||||||||||||
___________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 2 |
MUFG Americas Holdings Corporation and Subsidiaries
Credit Quality (Unaudited)
Percent Change to | ||||||||||||||||||||||||||
As of and for the Three Months Ended | June 30, 2016 from | |||||||||||||||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | December 31, 2015 | September 30, 2015 | June 30, 2015 | March 31, 2016 | June 30, 2015 | |||||||||||||||||||
Credit Data: | ||||||||||||||||||||||||||
(Reversal of) provision for loan losses | $ | (34 | ) | $ | 158 | $ | 168 | $ | 23 | $ | 26 | (122 | )% | (231 | )% | |||||||||||
(Reversal of) provision for losses on unfunded credit commitments | (3 | ) | 4 | 24 | (5 | ) | (11 | ) | (175 | ) | 73 | |||||||||||||||
Total (reversal of) provision for credit losses | $ | (37 | ) | $ | 162 | $ | 192 | $ | 18 | $ | 15 | (123 | ) | (347 | ) | |||||||||||
Net loans charged-off (recovered) | $ | 98 | $ | 4 | $ | (6 | ) | $ | 11 | $ | 20 | nm | 390 | |||||||||||||
Nonperforming assets | 648 | 974 | 573 | 434 | 381 | (33 | ) | 70 | ||||||||||||||||||
Criticized loans held for investment (12) | 2,859 | 3,066 | 2,454 | 1,642 | 1,395 | (7 | ) | 105 | ||||||||||||||||||
Credit Ratios: | ||||||||||||||||||||||||||
Allowance for loan losses to: | ||||||||||||||||||||||||||
Total loans held for investment | 0.94 | % | 1.11 | % | 0.93 | % | 0.71 | % | 0.70 | % | ||||||||||||||||
Nonaccrual loans | 118.24 | 91.99 | 130.53 | 130.46 | 147.98 | |||||||||||||||||||||
Allowance for credit losses to (13): | ||||||||||||||||||||||||||
Total loans held for investment | 1.15 | 1.32 | 1.14 | 0.90 | 0.89 | |||||||||||||||||||||
Nonaccrual loans | 144.50 | 109.68 | 160.42 | 164.09 | 188.39 | |||||||||||||||||||||
Net loans charged-off (recovered) to average total loans held for investment (3) | 0.49 | 0.02 | (0.03 | ) | 0.06 | 0.10 | ||||||||||||||||||||
Nonperforming assets to total loans held for investment and Other Real Estate Owned (OREO) | 0.82 | 1.23 | 0.74 | 0.57 | 0.50 | |||||||||||||||||||||
Nonperforming assets to total assets | 0.55 | 0.81 | 0.49 | 0.38 | 0.33 | |||||||||||||||||||||
Nonaccrual loans to total loans held for investment | 0.80 | 1.21 | 0.71 | 0.55 | 0.47 | |||||||||||||||||||||
As of and for the Six Months Ended | Percent Change | |||||||||||||||||||||||||
June 30, | June 30, | to June 30, 2016 | ||||||||||||||||||||||||
(Dollars in millions) | 2016 | 2015 | from June 30, 2015 | |||||||||||||||||||||||
Credit Data: | ||||||||||||||||||||||||||
Provision for loan losses | $ | 124 | $ | 23 | 439% | |||||||||||||||||||||
(Reversal of) provision for losses on unfunded credit commitments | 1 | (5 | ) | 120 | ||||||||||||||||||||||
Total provision for credit losses | $ | 125 | $ | 18 | nm | |||||||||||||||||||||
Net loans charged-off | $ | 102 | $ | 23 | 343% | |||||||||||||||||||||
Credit Ratios: | ||||||||||||||||||||||||||
Net loans charged-off to average total loans held for investment (3) | 0.26 | % | 0.06 | % | ||||||||||||||||||||||
________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 3 |
MUFG Americas Holdings Corporation and Subsidiaries
Consolidated Statements of Income (Unaudited)
For the Three Months Ended | |||||||||||||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | December 31, 2015 | September 30, 2015 | June 30, 2015 | ||||||||||||||||||
Interest Income | |||||||||||||||||||||||
Loans | $ | 711 | $ | 697 | $ | 693 | $ | 688 | $ | 700 | |||||||||||||
Securities | 114 | 109 | 124 | 116 | 121 | ||||||||||||||||||
Other | 5 | 6 | 4 | 5 | 2 | ||||||||||||||||||
Total interest income | 830 | 812 | 821 | 809 | 823 | ||||||||||||||||||
Interest Expense | |||||||||||||||||||||||
Deposits | 49 | 49 | 50 | 48 | 50 | ||||||||||||||||||
Commercial paper and other short-term borrowings | 4 | 1 | 1 | 3 | 2 | ||||||||||||||||||
Long-term debt | 57 | 65 | 62 | 53 | 52 | ||||||||||||||||||
Total interest expense | 110 | 115 | 113 | 104 | 104 | ||||||||||||||||||
Net Interest Income | 720 | 697 | 708 | 705 | 719 | ||||||||||||||||||
(Reversal of) provision for credit losses | (37 | ) | 162 | 192 | 18 | 15 | |||||||||||||||||
Net interest income after provision for credit losses | 757 | 535 | 516 | 687 | 704 | ||||||||||||||||||
Noninterest Income | |||||||||||||||||||||||
Service charges on deposit accounts | 46 | 49 | 49 | 49 | 49 | ||||||||||||||||||
Trust and investment management fees | 30 | 31 | 28 | 27 | 26 | ||||||||||||||||||
Trading account activities | 20 | 13 | 21 | 7 | 19 | ||||||||||||||||||
Securities gains, net | 19 | 13 | 6 | 6 | 5 | ||||||||||||||||||
Credit facility fees | 28 | 27 | 28 | 27 | 30 | ||||||||||||||||||
Merchant banking fees | 23 | 14 | 17 | 22 | 20 | ||||||||||||||||||
Brokerage commissions and fees | 13 | 13 | 14 | 13 | 14 | ||||||||||||||||||
Card processing fees, net | 9 | 9 | 8 | 8 | 9 | ||||||||||||||||||
Fees from affiliates (14) | 239 | 200 | 204 | 185 | 192 | ||||||||||||||||||
Other, net | 39 | 26 | 38 | 53 | 21 | ||||||||||||||||||
Total noninterest income | 466 | 395 | 413 | 397 | 385 | ||||||||||||||||||
Noninterest Expense | |||||||||||||||||||||||
Salaries and employee benefits | 523 | 543 | 569 | 557 | 555 | ||||||||||||||||||
Net occupancy and equipment | 75 | 76 | 83 | 79 | 75 | ||||||||||||||||||
Professional and outside services | 75 | 102 | 82 | 78 | 64 | ||||||||||||||||||
Software | 37 | 36 | 34 | 28 | 29 | ||||||||||||||||||
Regulatory assessments | 13 | 14 | 13 | 11 | 14 | ||||||||||||||||||
Intangible asset amortization | 6 | 7 | 10 | 10 | 10 | ||||||||||||||||||
Other | 81 | 98 | 100 | 92 | 96 | ||||||||||||||||||
Total noninterest expense | 810 | 876 | 891 | 855 | 843 | ||||||||||||||||||
Income before income taxes and including | |||||||||||||||||||||||
noncontrolling interests | 413 | 54 | 38 | 229 | 246 | ||||||||||||||||||
Income tax expense | 119 | 17 | (18 | ) | 64 | 71 | |||||||||||||||||
Net Income including Noncontrolling Interests | 294 | 37 | 56 | 165 | 175 | ||||||||||||||||||
Deduct: Net loss from noncontrolling interests | 11 | 12 | 13 | 21 | 6 | ||||||||||||||||||
Net Income attributable to MUAH | $ | 305 | $ | 49 | $ | 69 | $ | 186 | $ | 181 |
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 4 |
MUFG Americas Holdings Corporation and Subsidiaries
Consolidated Statements of Income (Unaudited)
For the Six Months Ended | ||||||||||
(Dollars in millions) | June 30, 2016 | June 30, 2015 | ||||||||
Interest Income | ||||||||||
Loans | $ | 1,408 | $ | 1,378 | ||||||
Securities | 223 | 223 | ||||||||
Other | 11 | 5 | ||||||||
Total interest income | 1,642 | 1,606 | ||||||||
Interest Expense | ||||||||||
Deposits | 98 | 102 | ||||||||
Commercial paper and other short-term borrowings | 5 | 3 | ||||||||
Long-term debt | 122 | 99 | ||||||||
Total interest expense | 225 | 204 | ||||||||
Net Interest Income | 1,417 | 1,402 | ||||||||
Provision for credit losses | 125 | 18 | ||||||||
Net interest income after provision for credit losses | 1,292 | 1,384 | ||||||||
Noninterest Income | ||||||||||
Service charges on deposit accounts | 95 | 98 | ||||||||
Trust and investment management fees | 61 | 54 | ||||||||
Trading account activities | 33 | 27 | ||||||||
Securities gains, net | 32 | 8 | ||||||||
Credit facility fees | 55 | 60 | ||||||||
Merchant banking fees | 37 | 40 | ||||||||
Brokerage commissions and fees | 26 | 27 | ||||||||
Card processing fees, net | 18 | 17 | ||||||||
Fees from affiliates (14) | 439 | 358 | ||||||||
Other, net | 65 | 31 | ||||||||
Total noninterest income | 861 | 720 | ||||||||
Noninterest Expense | ||||||||||
Salaries and employee benefits | 1,066 | 1,122 | ||||||||
Net occupancy and equipment | 151 | 155 | ||||||||
Professional and outside services | 177 | 141 | ||||||||
Software | 73 | 57 | ||||||||
Regulatory assessments | 27 | 27 | ||||||||
Intangible asset amortization | 13 | 20 | ||||||||
Other | 179 | 170 | ||||||||
Total noninterest expense | 1,686 | 1,692 | ||||||||
Income before income taxes and including | ||||||||||
noncontrolling interests | 467 | 412 | ||||||||
Income tax expense | 136 | 105 | ||||||||
Net Income including Noncontrolling Interests | 331 | 307 | ||||||||
Deduct: Net loss from noncontrolling interests | 23 | 11 | ||||||||
Net Income attributable to MUAH | $ | 354 | $ | 318 |
___________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 5 |
MUFG Americas Holdings Corporation and Subsidiaries
Consolidated Balance Sheets (Unaudited)
(Dollars in millions except for per share amount) | June 30, 2016 | March 31, 2016 | December 31, 2015 | September 30, 2015 | June 30, 2015 | ||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Cash and due from banks | $ | 1,517 | $ | 1,599 | $ | 1,756 | $ | 1,596 | $ | 1,815 | |||||||||||||||
Interest bearing deposits in banks | 2,306 | 6,696 | 2,749 | 2,692 | 2,160 | ||||||||||||||||||||
Federal funds sold and securities purchased under resale agreements | 42 | 29 | 24 | 86 | 68 | ||||||||||||||||||||
Total cash and cash equivalents | 3,865 | 8,324 | 4,529 | 4,374 | 4,043 | ||||||||||||||||||||
Trading account assets | 1,562 | 1,370 | 1,087 | 1,200 | 1,089 | ||||||||||||||||||||
Securities available for sale | 12,846 | 13,011 | 14,344 | 14,355 | 14,285 | ||||||||||||||||||||
Securities held to maturity | 10,259 | 10,605 | 10,158 | 10,341 | 10,002 | ||||||||||||||||||||
Loans held for investment | 79,392 | 79,299 | 77,599 | 76,641 | 76,399 | ||||||||||||||||||||
Allowance for loan losses | (747 | ) | (879 | ) | (721 | ) | (547 | ) | (536 | ) | |||||||||||||||
Loans held for investment, net | 78,645 | 78,420 | 76,878 | 76,094 | 75,863 | ||||||||||||||||||||
Premises and equipment, net | 566 | 632 | 608 | 607 | 622 | ||||||||||||||||||||
Goodwill | 3,225 | 3,225 | 3,225 | 3,225 | 3,225 | ||||||||||||||||||||
Other assets | 6,188 | 5,322 | 5,387 | 4,961 | 5,137 | ||||||||||||||||||||
Total assets | $ | 117,156 | $ | 120,909 | $ | 116,216 | $ | 115,157 | $ | 114,266 | |||||||||||||||
Liabilities | |||||||||||||||||||||||||
Deposits: | |||||||||||||||||||||||||
Noninterest bearing | $ | 32,861 | $ | 38,556 | $ | 32,463 | $ | 31,869 | $ | 30,156 | |||||||||||||||
Interest bearing | 49,831 | 50,944 | 51,877 | 50,824 | 51,546 | ||||||||||||||||||||
Total deposits | 82,692 | 89,500 | 84,340 | 82,693 | 81,702 | ||||||||||||||||||||
Commercial paper and other short-term borrowings | 4,703 | 647 | 1,038 | 2,338 | 5,262 | ||||||||||||||||||||
Long-term debt | 10,445 | 11,843 | 12,349 | 11,357 | 8,852 | ||||||||||||||||||||
Trading account liabilities | 676 | 747 | 796 | 891 | 734 | ||||||||||||||||||||
Other liabilities | 2,262 | 2,203 | 2,017 | 2,044 | 2,216 | ||||||||||||||||||||
Total liabilities | 100,778 | 104,940 | 100,540 | 99,323 | 98,766 | ||||||||||||||||||||
Equity | |||||||||||||||||||||||||
MUAH stockholder's equity: | |||||||||||||||||||||||||
Common stock, par value $1 per share: | |||||||||||||||||||||||||
Authorized 300,000,000 shares; 136,330,831 shares issued and outstanding as of June 30, 2016, March 31, 2016, December 31, 2015, September 30, 2015 and June 30, 2015 | 136 | 136 | 136 | 136 | 136 | ||||||||||||||||||||
Additional paid-in capital | 7,240 | 7,250 | 7,241 | 7,224 | 7,208 | ||||||||||||||||||||
Retained earnings | 9,189 | 8,885 | 8,836 | 8,768 | 8,582 | ||||||||||||||||||||
Accumulated other comprehensive loss | (386 | ) | (513 | ) | (752 | ) | (525 | ) | (666 | ) | |||||||||||||||
Total MUAH stockholder's equity | 16,179 | 15,758 | 15,461 | 15,603 | 15,260 | ||||||||||||||||||||
Noncontrolling interests | 199 | 211 | 215 | 231 | 240 | ||||||||||||||||||||
Total equity | 16,378 | 15,969 | 15,676 | 15,834 | 15,500 | ||||||||||||||||||||
Total liabilities and equity | $ | 117,156 | $ | 120,909 | $ | 116,216 | $ | 115,157 | $ | 114,266 |
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 6 |
MUFG Americas Holdings Corporation and Subsidiaries
Net Interest Income (Unaudited)
For the Three Months Ended | ||||||||||||||||||||||
June 30, 2016 | March 31, 2016 | |||||||||||||||||||||
Interest | Average | Interest | Average | |||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | |||||||||||||||||
(Dollars in millions) | Balance | Expense (7) | Rate (3)(7) | Balance | Expense (7) | Rate (3)(7) | ||||||||||||||||
Assets | ||||||||||||||||||||||
Loans held for investment: (15) | ||||||||||||||||||||||
Commercial and industrial | $ | 30,359 | $ | 243 | 3.23 | % | $ | 29,957 | $ | 238 | 3.20 | % | ||||||||||
Commercial mortgage | 15,095 | 139 | 3.66 | 14,485 | 133 | 3.68 | ||||||||||||||||
Construction | 2,211 | 21 | 3.92 | 2,272 | 23 | 3.93 | ||||||||||||||||
Lease financing | 733 | 11 | 5.58 | 732 | 8 | 4.56 | ||||||||||||||||
Residential mortgage | 27,770 | 230 | 3.31 | 27,366 | 231 | 3.38 | ||||||||||||||||
Home equity and other consumer loans | 3,473 | 43 | 4.96 | 3,315 | 40 | 4.85 | ||||||||||||||||
Loans, before purchased credit-impaired loans | 79,641 | 687 | 3.46 | 78,127 | 673 | 3.46 | ||||||||||||||||
Purchased credit-impaired loans | 293 | 27 | 36.86 | 323 | 25 | 31.04 | ||||||||||||||||
Total loans held for investment | 79,934 | 714 | 3.58 | 78,450 | 698 | 3.57 | ||||||||||||||||
Securities | 23,259 | 118 | 2.04 | 23,507 | 115 | 1.95 | ||||||||||||||||
Interest bearing deposits in banks | 1,668 | 2 | 0.56 | 2,400 | 3 | 0.53 | ||||||||||||||||
Federal funds sold and securities purchased under resale agreements | 66 | — | 0.23 | 78 | — | 0.46 | ||||||||||||||||
Trading account assets | 152 | — | 0.40 | 162 | — | 0.57 | ||||||||||||||||
Other earning assets | 71 | 3 | 7.28 | 291 | 3 | 3.62 | ||||||||||||||||
Total earning assets | 105,150 | 837 | 3.19 | 104,888 | 819 | 3.13 | ||||||||||||||||
Allowance for loan losses | (873 | ) | (719 | ) | ||||||||||||||||||
Cash and due from banks | 1,608 | 1,704 | ||||||||||||||||||||
Premises and equipment, net | 611 | 608 | ||||||||||||||||||||
Other assets (16) | 9,785 | 9,385 | ||||||||||||||||||||
Total assets | $ | 116,281 | $ | 115,866 | ||||||||||||||||||
Liabilities | ||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||
Transaction and money market accounts | $ | 37,558 | 29 | 0.30 | $ | 38,397 | 28 | 0.30 | ||||||||||||||
Savings | 5,743 | — | 0.04 | 5,715 | 1 | 0.06 | ||||||||||||||||
Time | 7,519 | 20 | 1.07 | 7,577 | 20 | 1.08 | ||||||||||||||||
Total interest bearing deposits | 50,820 | 49 | 0.39 | 51,689 | 49 | 0.38 | ||||||||||||||||
Commercial paper and other short-term borrowings (17) | 2,853 | 4 | 0.57 | 1,098 | 1 | 0.37 | ||||||||||||||||
Long-term debt | 11,262 | 57 | 2.02 | 12,148 | 65 | 2.12 | ||||||||||||||||
Total borrowed funds | 14,115 | 61 | 1.73 | 13,246 | 66 | 1.98 | ||||||||||||||||
Total interest bearing liabilities | 64,935 | 110 | 0.68 | 64,935 | 115 | 0.71 | ||||||||||||||||
Noninterest bearing deposits | 32,843 | 32,321 | ||||||||||||||||||||
Other liabilities (18) | 2,377 | 2,745 | ||||||||||||||||||||
Total liabilities | 100,155 | 100,001 | ||||||||||||||||||||
Equity | ||||||||||||||||||||||
MUAH stockholder's equity | 15,918 | 15,687 | ||||||||||||||||||||
Noncontrolling interests | 208 | 178 | ||||||||||||||||||||
Total equity | 16,126 | 15,865 | ||||||||||||||||||||
Total liabilities and equity | $ | 116,281 | $ | 115,866 | ||||||||||||||||||
Net interest income/spread (taxable-equivalent basis) | 727 | 2.51 | % | 704 | 2.42 | % | ||||||||||||||||
Impact of noninterest bearing deposits | 0.23 | 0.23 | ||||||||||||||||||||
Impact of other noninterest bearing sources | 0.03 | 0.04 | ||||||||||||||||||||
Net interest margin | 2.77 | 2.69 | ||||||||||||||||||||
Less: taxable-equivalent adjustment | 7 | 7 | ||||||||||||||||||||
Net interest income | $ | 720 | $ | 697 |
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 7 |
MUFG Americas Holdings Corporation and Subsidiaries
Net Interest Income (Unaudited)
For the Three Months Ended | |||||||||||||||||||||||
June 30, 2016 | June 30, 2015 | ||||||||||||||||||||||
Interest | Average | Interest | Average | ||||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | ||||||||||||||||||
(Dollars in millions) | Balance | Expense (7) | Rate (3)(7) | Balance | Expense (7) | Rate (3)(7) | |||||||||||||||||
Assets | |||||||||||||||||||||||
Loans held for investment: (15) | |||||||||||||||||||||||
Commercial and industrial | $ | 30,359 | $ | 243 | 3.23 | % | $ | 28,107 | $ | 224 | 3.19 | % | |||||||||||
Commercial mortgage | 15,095 | 139 | 3.66 | 13,859 | 127 | 3.65 | |||||||||||||||||
Construction | 2,211 | 21 | 3.92 | 2,045 | 18 | 3.62 | |||||||||||||||||
Lease financing | 733 | 11 | 5.58 | 772 | 10 | 5.40 | |||||||||||||||||
Residential mortgage | 27,770 | 230 | 3.31 | 28,399 | 239 | 3.37 | |||||||||||||||||
Home equity and other consumer loans | 3,473 | 43 | 4.96 | 3,096 | 33 | 4.30 | |||||||||||||||||
Loans, before purchased credit-impaired loans | 79,641 | 687 | 3.46 | 76,278 | 651 | 3.42 | |||||||||||||||||
Purchased credit-impaired loans | 293 | 27 | 36.86 | 473 | 50 | 41.89 | |||||||||||||||||
Total loans held for investment | 79,934 | 714 | 3.58 | 76,751 | 701 | 3.66 | |||||||||||||||||
Securities | 23,259 | 118 | 2.04 | 22,915 | 126 | 2.20 | |||||||||||||||||
Interest bearing deposits in banks | 1,668 | 2 | 0.56 | 2,275 | 1 | 0.26 | |||||||||||||||||
Federal funds sold and securities purchased under resale agreements | 66 | — | 0.23 | 69 | — | (0.47 | ) | ||||||||||||||||
Trading account assets | 152 | — | 0.40 | 196 | 1 | 0.71 | |||||||||||||||||
Other earning assets | 71 | 3 | 7.28 | 83 | — | 4.00 | |||||||||||||||||
Total earning assets | 105,150 | 837 | 3.19 | 102,289 | 829 | 3.25 | |||||||||||||||||
Allowance for loan losses | (873 | ) | (535 | ) | |||||||||||||||||||
Cash and due from banks | 1,608 | 1,619 | |||||||||||||||||||||
Premises and equipment, net | 611 | 615 | |||||||||||||||||||||
Other assets (16) | 9,785 | 8,919 | |||||||||||||||||||||
Total assets | $ | 116,281 | $ | 112,907 | |||||||||||||||||||
Liabilities | |||||||||||||||||||||||
Interest bearing deposits: | |||||||||||||||||||||||
Transaction and money market accounts | $ | 37,558 | 29 | 0.30 | $ | 37,986 | 29 | 0.31 | |||||||||||||||
Savings | 5,743 | — | 0.04 | 5,588 | 1 | 0.06 | |||||||||||||||||
Time | 7,519 | 20 | 1.07 | 8,535 | 20 | 0.95 | |||||||||||||||||
Total interest bearing deposits | 50,820 | 49 | 0.39 | 52,109 | 50 | 0.39 | |||||||||||||||||
Commercial paper and other short-term borrowings (17) | 2,853 | 4 | 0.57 | 3,826 | 2 | 0.21 | |||||||||||||||||
Long-term debt | 11,262 | 57 | 2.02 | 8,855 | 52 | 2.34 | |||||||||||||||||
Total borrowed funds | 14,115 | 61 | 1.73 | 12,681 | 54 | 1.69 | |||||||||||||||||
Total interest bearing liabilities | 64,935 | 110 | 0.68 | 64,790 | 104 | 0.64 | |||||||||||||||||
Noninterest bearing deposits | 32,843 | 30,038 | |||||||||||||||||||||
Other liabilities (18) | 2,377 | 2,626 | |||||||||||||||||||||
Total liabilities | 100,155 | 97,454 | |||||||||||||||||||||
Equity | |||||||||||||||||||||||
MUAH stockholder's equity | 15,918 | 15,238 | |||||||||||||||||||||
Noncontrolling interests | 208 | 215 | |||||||||||||||||||||
Total equity | 16,126 | 15,453 | |||||||||||||||||||||
Total liabilities and equity | $ | 116,281 | $ | 112,907 | |||||||||||||||||||
Net interest income/spread (taxable-equivalent basis) | 727 | 2.51 | % | 725 | 2.61 | % | |||||||||||||||||
Impact of noninterest bearing deposits | 0.23 | 0.20 | |||||||||||||||||||||
Impact of other noninterest bearing sources | 0.03 | 0.03 | |||||||||||||||||||||
Net interest margin | 2.77 | 2.84 | |||||||||||||||||||||
Less: taxable-equivalent adjustment | 7 | 6 | |||||||||||||||||||||
Net interest income | $ | 720 | $ | 719 |
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 8 |
MUFG Americas Holdings Corporation and Subsidiaries
Net Interest Income (Unaudited)
For the Six Months Ended | ||||||||||||||||||||||
June 30, 2016 | June 30, 2015 | |||||||||||||||||||||
Interest | Average | Interest | Average | |||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | |||||||||||||||||
(Dollars in millions) | Balance | Expense (7) | Rate (3)(7) | Balance | Expense (7) | Rate (3)(7) | ||||||||||||||||
Assets | ||||||||||||||||||||||
Loans held for investment: (15) | ||||||||||||||||||||||
Commercial and industrial | $ | 30,158 | $ | 481 | 3.21 | % | $ | 28,250 | $ | 435 | 3.11 | % | ||||||||||
Commercial mortgage | 14,790 | 272 | 3.68 | 13,881 | 251 | 3.61 | ||||||||||||||||
Construction | 2,242 | 44 | 3.93 | 1,949 | 35 | 3.59 | ||||||||||||||||
Lease financing | 733 | 19 | 5.07 | 774 | 20 | 5.25 | ||||||||||||||||
Residential mortgage | 27,568 | 461 | 3.34 | 28,581 | 486 | 3.40 | ||||||||||||||||
Home equity and other consumer loans | 3,394 | 83 | 4.91 | 3,099 | 65 | 4.26 | ||||||||||||||||
Loans, before purchased credit-impaired loans | 78,885 | 1,360 | 3.46 | 76,534 | 1,292 | 3.39 | ||||||||||||||||
Purchased credit-impaired loans | 308 | 52 | 33.81 | 492 | 88 | 36.01 | ||||||||||||||||
Total loans held for investment | 79,193 | 1,412 | 3.57 | 77,026 | 1,380 | 3.60 | ||||||||||||||||
Securities | 23,383 | 233 | 2.00 | 22,546 | 232 | 2.06 | ||||||||||||||||
Interest bearing deposits in banks | 2,034 | 5 | 0.54 | 2,524 | 3 | 0.26 | ||||||||||||||||
Federal funds sold and securities purchased under resale agreements | 72 | — | 0.36 | 83 | — | (0.32 | ) | |||||||||||||||
Trading account assets | 157 | — | 0.49 | 196 | 1 | 0.71 | ||||||||||||||||
Other earning assets | 181 | 6 | 4.34 | 68 | 1 | 3.97 | ||||||||||||||||
Total earning assets | 105,020 | 1,656 | 3.16 | 102,443 | 1,617 | 3.17 | ||||||||||||||||
Allowance for loan losses | (796 | ) | (539 | ) | ||||||||||||||||||
Cash and due from banks | 1,656 | 1,625 | ||||||||||||||||||||
Premises and equipment, net | 609 | 618 | ||||||||||||||||||||
Other assets (16) | 9,585 | 8,873 | ||||||||||||||||||||
Total assets | $ | 116,074 | $ | 113,020 | ||||||||||||||||||
Liabilities | ||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||
Transaction and money market accounts | $ | 37,977 | 57 | 0.30 | $ | 38,845 | 59 | 0.31 | ||||||||||||||
Savings | 5,729 | 1 | 0.05 | 5,569 | 2 | 0.06 | ||||||||||||||||
Time | 7,548 | 40 | 1.07 | 8,754 | 41 | 0.94 | ||||||||||||||||
Total interest bearing deposits | 51,254 | 98 | 0.38 | 53,168 | 102 | 0.39 | ||||||||||||||||
Commercial paper and other short-term borrowings (17) | 1,975 | 5 | 0.52 | 3,411 | 3 | 0.21 | ||||||||||||||||
Long-term debt | 11,705 | 122 | 2.07 | 8,434 | 99 | 2.34 | ||||||||||||||||
Total borrowed funds | 13,680 | 127 | 1.85 | 11,845 | 102 | 1.72 | ||||||||||||||||
Total interest bearing liabilities | 64,934 | 225 | 0.69 | 65,013 | 204 | 0.63 | ||||||||||||||||
Noninterest bearing deposits | 32,582 | 29,944 | ||||||||||||||||||||
Other liabilities (18) | 2,561 | 2,687 | ||||||||||||||||||||
Total liabilities | 100,077 | 97,644 | ||||||||||||||||||||
Equity | ||||||||||||||||||||||
MUAH stockholder's equity | 15,804 | 15,154 | ||||||||||||||||||||
Noncontrolling interests | 193 | 222 | ||||||||||||||||||||
Total equity | 15,997 | 15,376 | ||||||||||||||||||||
Total liabilities and equity | $ | 116,074 | $ | 113,020 | ||||||||||||||||||
Net interest income/spread (taxable-equivalent basis) | 1,431 | 2.47 | % | 1,413 | 2.54 | % | ||||||||||||||||
Impact of noninterest bearing deposits | 0.23 | 0.20 | ||||||||||||||||||||
Impact of other noninterest bearing sources | 0.03 | 0.03 | ||||||||||||||||||||
Net interest margin | 2.73 | 2.77 | ||||||||||||||||||||
Less: taxable-equivalent adjustment | 14 | 11 | ||||||||||||||||||||
Net interest income | $ | 1,417 | $ | 1,402 |
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 9 |
MUFG Americas Holdings Corporation and Subsidiaries
Loans and Nonperforming Assets (Unaudited)
(Dollars in millions) | June 30, 2016 | March 31, 2016 | December 31, 2015 | September 30, 2015 | June 30, 2015 | ||||||||||||||||||||||
Loans held for investment (period end) | |||||||||||||||||||||||||||
Loans held for investment: | |||||||||||||||||||||||||||
Commercial and industrial | $ | 29,291 | $ | 30,212 | $ | 29,730 | $ | 28,462 | $ | 27,854 | |||||||||||||||||
Commercial mortgage | 15,144 | 14,920 | 13,904 | 13,943 | 13,800 | ||||||||||||||||||||||
Construction | 2,255 | 2,251 | 2,297 | 2,120 | 2,071 | ||||||||||||||||||||||
Lease financing | 723 | 732 | 737 | 748 | 759 | ||||||||||||||||||||||
Total commercial portfolio | 47,413 | 48,115 | 46,668 | 45,273 | 44,484 | ||||||||||||||||||||||
Residential mortgage | 28,244 | 27,495 | 27,344 | 27,856 | 28,374 | ||||||||||||||||||||||
Home equity and other consumer loans | 3,459 | 3,385 | 3,251 | 3,124 | 3,098 | ||||||||||||||||||||||
Total consumer portfolio | 31,703 | 30,880 | 30,595 | 30,980 | 31,472 | ||||||||||||||||||||||
Loans held for investment, before purchased credit-impaired loans | 79,116 | 78,995 | 77,263 | 76,253 | 75,956 | ||||||||||||||||||||||
Purchased credit-impaired loans | 276 | 304 | 336 | 388 | 443 | ||||||||||||||||||||||
Total loans held for investment | $ | 79,392 | $ | 79,299 | $ | 77,599 | $ | 76,641 | $ | 76,399 | |||||||||||||||||
Nonperforming Assets (period end) | |||||||||||||||||||||||||||
Nonaccrual loans: | |||||||||||||||||||||||||||
Commercial and industrial | $ | 396 | $ | 702 | $ | 284 | $ | 138 | $ | 64 | |||||||||||||||||
Commercial mortgage | 26 | 30 | 37 | 40 | 43 | ||||||||||||||||||||||
Total commercial portfolio | 422 | 732 | 321 | 178 | 107 | ||||||||||||||||||||||
Residential mortgage | 177 | 186 | 190 | 201 | 209 | ||||||||||||||||||||||
Home equity and other consumer loans | 28 | 32 | 35 | 32 | 36 | ||||||||||||||||||||||
Total consumer portfolio | 205 | 218 | 225 | 233 | 245 | ||||||||||||||||||||||
Nonaccrual loans, before purchased credit-impaired loans | 627 | 950 | 546 | 411 | 352 | ||||||||||||||||||||||
Purchased credit-impaired loans | 5 | 6 | 6 | 8 | 10 | ||||||||||||||||||||||
Total nonaccrual loans | 632 | 956 | 552 | 419 | 362 | ||||||||||||||||||||||
OREO | 16 | 18 | 21 | 15 | 19 | ||||||||||||||||||||||
Total nonperforming assets | $ | 648 | $ | 974 | $ | 573 | $ | 434 | $ | 381 | |||||||||||||||||
Loans 90 days or more past due and still accruing (19) | $ | 2 | $ | 6 | $ | 2 | $ | 4 | $ | 2 | |||||||||||||||||
__________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 10 |
MUFG Americas Holdings Corporation and Subsidiaries
Allowance for Credit Losses (Unaudited)
As of and for the Three Months Ended | ||||||||||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | December 31, 2015 | September 30, 2015 | June 30, 2015 | |||||||||||||||
Analysis of Allowance for Credit Losses | ||||||||||||||||||||
Allowance for loan losses, beginning of period | $ | 879 | $ | 721 | $ | 547 | $ | 536 | $ | 530 | ||||||||||
(Reversal of) provision for loan losses | (34 | ) | 158 | 168 | 23 | 26 | ||||||||||||||
Other | — | 4 | — | (1 | ) | — | ||||||||||||||
Loans charged-off: | ||||||||||||||||||||
Commercial and industrial | (46 | ) | (8 | ) | — | (11 | ) | (12 | ) | |||||||||||
Commercial and industrial - transfer to held for sale | (51 | ) | — | — | — | — | ||||||||||||||
Commercial mortgage | — | — | — | — | (1 | ) | ||||||||||||||
Total commercial portfolio | (97 | ) | (8 | ) | — | (11 | ) | (13 | ) | |||||||||||
Residential mortgage | — | 1 | — | — | — | |||||||||||||||
Home equity and other consumer loans | (2 | ) | (2 | ) | (1 | ) | (1 | ) | (3 | ) | ||||||||||
Total consumer portfolio | (2 | ) | (1 | ) | (1 | ) | (1 | ) | (3 | ) | ||||||||||
Purchased credit-impaired loans | — | — | (1 | ) | (3 | ) | (8 | ) | ||||||||||||
Total loans charged-off | (99 | ) | (9 | ) | (2 | ) | (15 | ) | (24 | ) | ||||||||||
Recoveries of loans previously charged-off: | ||||||||||||||||||||
Commercial and industrial | 1 | 1 | 7 | 2 | 3 | |||||||||||||||
Commercial mortgage | — | 3 | — | 1 | — | |||||||||||||||
Total commercial portfolio | 1 | 4 | 7 | 3 | 3 | |||||||||||||||
Home equity and other consumer loans | — | 1 | — | 1 | 1 | |||||||||||||||
Total consumer portfolio | — | 1 | — | 1 | 1 | |||||||||||||||
Purchased credit-impaired loans | — | — | 1 | — | — | |||||||||||||||
Total recoveries of loans previously charged-off | 1 | 5 | 8 | 4 | 4 | |||||||||||||||
Net loans (charged-off) recovered | (98 | ) | (4 | ) | 6 | (11 | ) | (20 | ) | |||||||||||
Ending balance of allowance for loan losses | 747 | 879 | 721 | 547 | 536 | |||||||||||||||
Allowance for losses on unfunded credit commitments | 166 | 169 | 165 | 141 | 147 | |||||||||||||||
Total allowance for credit losses | $ | 913 | $ | 1,048 | $ | 886 | $ | 688 | $ | 683 | ||||||||||
Exhibit 11 |
MUFG Americas Holdings Corporation and Subsidiaries
Securities (Unaudited)
Securities Available for Sale | ||||||||||||||||||||||||||
June 30, 2016 | March 31, 2016 | Fair Value | Fair Value | |||||||||||||||||||||||
Amortized | Fair | Amortized | Fair | Change from | % Change from | |||||||||||||||||||||
(Dollars in millions) | Cost | Value | Cost | Value | March 31, 2016 | March 31, 2016 | ||||||||||||||||||||
Asset Liability Management securities: | ||||||||||||||||||||||||||
U.S. Treasury | $ | 155 | $ | 159 | $ | 148 | $ | 152 | $ | 7 | 5 | % | ||||||||||||||
Residential mortgage-backed securities: | ||||||||||||||||||||||||||
U.S. government agency and government-sponsored agencies | 6,009 | 6,052 | 6,302 | 6,308 | (256 | ) | (4 | ) | ||||||||||||||||||
Privately issued | 245 | 248 | 202 | 203 | 45 | 22 | ||||||||||||||||||||
Privately issued - commercial mortgage-backed securities | 1,474 | 1,527 | 1,469 | 1,492 | 35 | 2 | ||||||||||||||||||||
Collateralized loan obligations | 3,267 | 3,238 | 3,267 | 3,227 | 11 | — | ||||||||||||||||||||
Asset-backed and other | 7 | 7 | 7 | 7 | — | — | ||||||||||||||||||||
Asset Liability Management securities | 11,157 | 11,231 | 11,395 | 11,389 | (158 | ) | (1 | ) | ||||||||||||||||||
Other debt securities: | ||||||||||||||||||||||||||
Direct bank purchase bonds | 1,547 | 1,575 | 1,560 | 1,581 | (6 | ) | — | |||||||||||||||||||
Other | 32 | 33 | 32 | 33 | — | — | ||||||||||||||||||||
Equity securities | 6 | 7 | 6 | 8 | (1 | ) | (13 | ) | ||||||||||||||||||
Total securities available for sale | $ | 12,742 | $ | 12,846 | $ | 12,993 | $ | 13,011 | $ | (165 | ) | (1 | )% | |||||||||||||
Securities Held to Maturity | ||||||||||||||||||||||||||
June 30, 2016 | March 31, 2016 | Carrying Amount | Carrying Amount | |||||||||||||||||||||||
Carrying | Fair | Carrying | Fair | Change from | % Change from | |||||||||||||||||||||
(Dollars in millions) | Amount (20) | Value | Amount (20) | Value | March 31, 2016 | March 31, 2016 | ||||||||||||||||||||
U.S. Treasury | $ | 490 | $ | 505 | $ | 490 | $ | 502 | $ | — | — | % | ||||||||||||||
U.S. government-sponsored agencies | — | — | 200 | 200 | (200 | ) | (100 | ) | ||||||||||||||||||
U.S. government agency and government-sponsored agencies-residential mortgage-backed securities | 8,126 | 8,329 | 8,254 | 8,403 | (128 | ) | (2 | ) | ||||||||||||||||||
U.S. government agency and government-sponsored agencies-commercial mortgage-backed securities | 1,643 | 1,739 | 1,661 | 1,743 | (18 | ) | (1 | ) | ||||||||||||||||||
Total securities held to maturity | $ | 10,259 | $ | 10,573 | $ | 10,605 | $ | 10,848 | $ | (346 | ) | (3 | )% |
___________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 12 |
MUFG Americas Holdings Corporation and Subsidiaries
Reconciliation of Non-GAAP Measures (Unaudited)
The following table presents a reconciliation between certain Generally Accepted Accounting Principles (GAAP) amounts and specific non-GAAP measures as used to compute selected non-GAAP financial ratios.
As of and for the Three Months Ended | ||||||||||||||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | December 31, 2015 | September 30, 2015 | June 30, 2015 | |||||||||||||||||||
Net income attributable to MUAH | $ | 305 | $ | 49 | $ | 69 | $ | 186 | $ | 181 | ||||||||||||||
Net adjustments for merger costs related to acquisitions, net of tax | 3 | 4 | 4 | 5 | 3 | |||||||||||||||||||
Net adjustments for privatization transaction, net of tax | 2 | — | 4 | 3 | 3 | |||||||||||||||||||
Net income attributable to MUAH, excluding impact of | ||||||||||||||||||||||||
privatization transaction and merger costs related to acquisitions | $ | 310 | $ | 53 | $ | 77 | $ | 194 | $ | 187 | ||||||||||||||
Average total assets | $ | 116,281 | $ | 115,866 | $ | 115,914 | $ | 113,451 | $ | 112,907 | ||||||||||||||
Less: Net adjustments related to privatization transaction | 2,213 | 2,215 | 2,218 | 2,224 | 2,230 | |||||||||||||||||||
Average total assets, excluding impact of privatization transaction | $ | 114,068 | $ | 113,651 | $ | 113,696 | $ | 111,227 | $ | 110,677 | ||||||||||||||
Return on average assets (3) | 1.05 | % | 0.17 | % | 0.24 | % | 0.66 | % | 0.64 | % | ||||||||||||||
Return on average assets, excluding impact of privatization | ||||||||||||||||||||||||
transaction and merger costs related to acquisitions (3) (4) | 1.09 | 0.18 | 0.27 | 0.70 | 0.67 | |||||||||||||||||||
Average MUAH stockholder's equity | $ | 15,918 | $ | 15,687 | $ | 15,722 | $ | 15,435 | $ | 15,238 | ||||||||||||||
Less: Adjustments for merger costs related to acquisitions | (187 | ) | (183 | ) | (179 | ) | (175 | ) | (171 | ) | ||||||||||||||
Less: Net adjustments for privatization transaction | 2,273 | 2,273 | 2,273 | 2,273 | 2,275 | |||||||||||||||||||
Average MUAH stockholder's equity, excluding impact of privatization | ||||||||||||||||||||||||
transaction and merger costs related to acquisitions | $ | 13,832 | $ | 13,597 | $ | 13,628 | $ | 13,337 | $ | 13,134 | ||||||||||||||
Return on average MUAH stockholder's equity (3) | 7.65 | % | 1.25 | % | 1.75 | % | 4.83 | % | 4.73 | % | ||||||||||||||
Return on average MUAH stockholder's equity, excluding impact of | ||||||||||||||||||||||||
privatization transaction and merger costs related to acquisitions (3) (4) | 8.96 | 1.54 | 2.24 | 5.82 | 5.69 | |||||||||||||||||||
Noninterest expense | $ | 810 | $ | 876 | $ | 891 | $ | 855 | $ | 843 | ||||||||||||||
Less: Staff costs associated with fees from affiliates - support services | 137 | 139 | 138 | 128 | 123 | |||||||||||||||||||
Less: Foreclosed asset expense and other credit costs | — | (1 | ) | — | 3 | — | ||||||||||||||||||
Less: Productivity initiative costs | 4 | 12 | 41 | 3 | 2 | |||||||||||||||||||
Less: Low income housing credit (LIHC) investment amortization expense | 2 | 2 | 6 | 5 | 2 | |||||||||||||||||||
Less: Expenses of the LIHC consolidated VIEs | 11 | 12 | 13 | 14 | 10 | |||||||||||||||||||
Less: Merger and business integration costs | 5 | 5 | 6 | 8 | 6 | |||||||||||||||||||
Less: Net adjustments related to privatization transaction | 5 | 5 | 8 | 8 | 7 | |||||||||||||||||||
Less: Intangible asset amortization | 2 | 3 | 3 | 2 | 3 | |||||||||||||||||||
Less: Contract termination fee | — | — | — | — | 23 | |||||||||||||||||||
Noninterest expense, as adjusted (a) | $ | 644 | $ | 699 | $ | 676 | $ | 684 | $ | 667 | ||||||||||||||
Total revenue | $ | 1,186 | $ | 1,092 | $ | 1,121 | $ | 1,102 | $ | 1,104 | ||||||||||||||
Add: Net interest income taxable-equivalent adjustment | 7 | 7 | 7 | 7 | 6 | |||||||||||||||||||
Less: Fees from affiliates - support services | 147 | 149 | 149 | 138 | 134 | |||||||||||||||||||
Less: Productivity initiative gains | — | — | — | — | (1 | ) | ||||||||||||||||||
Less: Accretion related to privatization-related fair value adjustments | 3 | 5 | 2 | 3 | 2 | |||||||||||||||||||
Less: Other credit costs | (9 | ) | (13 | ) | 4 | (8 | ) | 8 | ||||||||||||||||
Less: Impairment on private equity investments | — | (12 | ) | — | — | — | ||||||||||||||||||
Total revenue, as adjusted (b) | $ | 1,052 | $ | 970 | $ | 973 | $ | 976 | $ | 967 | ||||||||||||||
Adjusted efficiency ratio (a)/(b) (6) | 61.13 | % | 72.12 | % | 69.42 | % | 70.16 | % | 69.02 | % | ||||||||||||||
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 13 |
MUFG Americas Holdings Corporation and Subsidiaries
Reconciliation of Non-GAAP Measures (Unaudited)
The following table presents a reconciliation between certain Generally Accepted Accounting Principles (GAAP) amounts and specific non-GAAP measures as used to compute selected non-GAAP financial ratios.
As of and for the Three Months Ended | |||||||||||||||||||||||
(Dollars in millions) | June 30, 2016 | March 31, 2016 | December 31, 2015 | September 30, 2015 | June 30, 2015 | ||||||||||||||||||
Total MUAH stockholder's equity | $ | 16,179 | $ | 15,758 | $ | 15,461 | $ | 15,603 | $ | 15,260 | |||||||||||||
Less: Goodwill | 3,225 | 3,225 | 3,225 | 3,225 | 3,225 | ||||||||||||||||||
Less: Intangible assets, except mortgage servicing rights (MSRs) | 175 | 182 | 190 | 199 | 214 | ||||||||||||||||||
Less: Deferred tax liabilities related to goodwill and intangible assets | (48 | ) | (49 | ) | (39 | ) | (39 | ) | (41 | ) | |||||||||||||
Tangible common equity (c) | $ | 12,827 | $ | 12,400 | $ | 12,085 | $ | 12,218 | $ | 11,862 | |||||||||||||
Total assets | $ | 117,156 | $ | 120,909 | $ | 116,216 | $ | 115,157 | $ | 114,266 | |||||||||||||
Less: Goodwill | 3,225 | 3,225 | 3,225 | 3,225 | 3,225 | ||||||||||||||||||
Less: Intangible assets, except MSRs | 175 | 182 | 190 | 199 | 214 | ||||||||||||||||||
Less: Deferred tax liabilities related to goodwill and intangible assets | (48 | ) | (49 | ) | (39 | ) | (39 | ) | (41 | ) | |||||||||||||
Tangible assets (d) | $ | 113,804 | $ | 117,551 | $ | 112,840 | $ | 111,772 | $ | 110,868 | |||||||||||||
Tangible common equity ratio (c)/(d) (10) | 11.27 | % | 10.55 | % | 10.71 | % | 10.93 | % | 10.70 | % | |||||||||||||
Common Equity Tier 1 capital under U.S. Basel III (standardized transitional) (e) | $ | 13,233 | $ | 12,936 | $ | 12,920 | $ | 12,834 | $ | 12,632 | |||||||||||||
Other | (38 | ) | (40 | ) | (61 | ) | (67 | ) | (74 | ) | |||||||||||||
Common Equity Tier 1 capital estimated under U.S. Basel III (standardized approach; fully phased-in) (f) | $ | 13,195 | $ | 12,896 | $ | 12,859 | $ | 12,767 | $ | 12,558 | |||||||||||||
Risk-weighted assets, estimated under U.S. Basel III (standardized transitional) (g) | $ | 97,061 | $ | 97,011 | $ | 94,775 | $ | 92,729 | $ | 93,179 | |||||||||||||
Add: Adjustments | (118 | ) | (122 | ) | 756 | (160 | ) | (67 | ) | ||||||||||||||
Total risk-weighted assets, estimated under U.S. Basel III (standardized approach; fully phased-in) (h) | $ | 96,943 | $ | 96,889 | $ | 95,531 | $ | 92,569 | $ | 93,112 | |||||||||||||
Common Equity Tier 1 risk-based capital ratio (U.S. Basel III standardized approach; fully phased-in) (f)/(h) (8) (11) | 13.61 | % | 13.31 | % | 13.46 | % | 13.79 | % | 13.49 | % |
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 14 |
MUFG Americas Holdings Corporation and Subsidiaries
Reconciliation of Non-GAAP Measures (Unaudited)
The following table presents a reconciliation between certain Generally Accepted Accounting Principles (GAAP) amounts and specific non-GAAP measures as used to compute selected non-GAAP financial ratios.
As of and for the Six Months Ended | ||||||||||||
June 30, | June 30, | |||||||||||
(Dollars in millions) | 2016 | 2015 | ||||||||||
Net income attributable to MUAH | $ | 354 | $ | 318 | ||||||||
Net adjustments for merger costs related to acquisitions, net of tax | 7 | 9 | ||||||||||
Net adjustments for privatization transaction, net of tax | 2 | 6 | ||||||||||
Net income attributable to MUAH, excluding impact of | ||||||||||||
privatization transaction and merger costs related to acquisitions | $ | 363 | $ | 333 | ||||||||
Average total assets | $ | 116,074 | $ | 113,020 | ||||||||
Less: Net adjustments related to privatization transaction | 2,214 | 2,233 | ||||||||||
Average total assets, excluding impact of privatization transaction | $ | 113,860 | $ | 110,787 | ||||||||
Return on average assets (3) | 0.61 | % | 0.56 | % | ||||||||
Return on average assets, excluding impact of privatization | ||||||||||||
transaction and merger costs related to acquisitions (3) (4) | 0.64 | 0.60 | ||||||||||
Average MUAH stockholder's equity | $ | 15,804 | $ | 15,154 | ||||||||
Less: Adjustments for merger costs related to acquisitions | (185 | ) | (169 | ) | ||||||||
Less: Net adjustments for privatization transaction | 2,273 | 2,275 | ||||||||||
Average MUAH stockholder's equity, excluding impact of privatization | ||||||||||||
transaction and merger costs related to acquisitions | $ | 13,716 | $ | 13,048 | ||||||||
Return on average MUAH stockholder's equity (3) | 4.48 | % | 4.19 | % | ||||||||
Return on average MUAH stockholder's equity, excluding impact of | ||||||||||||
privatization transaction and merger costs related to acquisitions (3) (4) | 5.29 | 5.10 | ||||||||||
Noninterest expense | $ | 1,686 | $ | 1,692 | ||||||||
Less: Staff costs associated with fees from affiliates - support services | 276 | 235 | ||||||||||
Less: Foreclosed asset expense and other credit costs | (1 | ) | 1 | |||||||||
Less: Productivity initiative costs | 16 | 30 | ||||||||||
Less: Low income housing credit (LIHC) investment amortization expense | 4 | 4 | ||||||||||
Less: Expenses of the LIHC consolidated VIEs | 23 | 18 | ||||||||||
Less: Merger and business integration costs | 10 | 15 | ||||||||||
Less: Net adjustments related to privatization transaction | 10 | 15 | ||||||||||
Less: Intangible asset amortization | 5 | 7 | ||||||||||
Less: Contract termination fee | — | 23 | ||||||||||
Noninterest expense, as adjusted (a) | $ | 1,343 | $ | 1,344 | ||||||||
Total revenue | $ | 2,278 | $ | 2,122 | ||||||||
Add: Net interest income taxable-equivalent adjustment | 14 | 11 | ||||||||||
Less: Fees from affiliates - support services | 296 | 255 | ||||||||||
Less: Productivity initiative gains | — | — | ||||||||||
Less: Accretion related to privatization-related fair value adjustments | 8 | 3 | ||||||||||
Less: Other credit costs | (22 | ) | 4 | |||||||||
Less: Impairment on private equity investments | (12 | ) | — | |||||||||
Total revenue, as adjusted (b) | $ | 2,022 | $ | 1,871 | ||||||||
Adjusted efficiency ratio (a)/(b) (6) | 66.39 | % | 71.86 | % | ||||||||
____________________________________________
Refer to Exhibit 16 for footnote explanations.
Exhibit 15 |
MUFG Americas Holdings Corporation and Subsidiaries
Footnotes
(1) | Pre-tax, pre-provision income is total revenue less noninterest expense. Management believes that this is a useful financial measure because it enables investors and others to assess the Company's ability to generate capital to cover credit losses through a credit cycle. |
(2) | Core deposits exclude brokered deposits, foreign time deposits, domestic time deposits greater than $250,000 and certain other deposits not considered to be core customer relationships. |
(3) | Annualized. |
(4) | These ratios exclude the impact of the privatization transaction and merger costs related to acquisitions. Management believes that these ratios provide useful supplemental information regarding the Company's business results. Please refer to Exhibits 13 and 15 for reconciliations between certain GAAP amounts and these non-GAAP measures. |
(5) | The efficiency ratio is total noninterest expense as a percentage of total revenue (net interest income and noninterest income). |
(6) | The adjusted efficiency ratio, a non-GAAP financial measure, is adjusted noninterest expense (noninterest expense excluding staff costs associated with fees from affiliates - support services, foreclosed asset expense and other credit costs, certain costs related to productivity initiatives, LIHC investment amortization expense, expenses of the LIHC consolidated variable interest entities, merger and business integration costs, privatization-related expenses, intangible asset amortization, and a contract termination fee) as a percentage of adjusted total revenue (net interest income (taxable-equivalent basis) and noninterest income), excluding the impact of fees from affiliates - support services, productivity initiatives related to the sale of certain premises, accretion related to privatization-related fair value adjustments, other credit costs and impairment on private equity investments. Management discloses the adjusted efficiency ratio as a measure of the efficiency of our operations, focusing on those costs most relevant to our business activities. Please refer to Exhibits 13 and 15 for reconciliations between certain GAAP amounts and these non-GAAP measures. |
(7) | Yields, interest income and net interest margin are presented on a taxable-equivalent basis using the federal statutory tax rate of 35%. Beginning in the second quarter of 2016, the effect of interest rate hedges on commercial loans was reflected in each loan category. Previously, the entire effect of interest rate hedges was included in commercial and industrial interest income. Prior period amounts have been reclassified to conform to the current presentation. |
(8) | Preliminary as of June 30, 2016. |
(9) | These capital ratios are calculated in accordance with the transition guidelines set forth in the U.S. federal banking agencies' final U.S. Basel III regulatory capital rules. |
(10) | The tangible common equity ratio, a non-GAAP financial measure, is calculated as tangible common equity divided by tangible assets. The methodology for determining tangible common equity may differ among companies. The tangible common equity ratio facilitates the understanding of the Company's capital structure and is used to assess and compare the quality and composition of the Company's capital structure to other financial institutions. Please refer to Exhibit 14 for a reconciliation between certain GAAP amounts and these non-GAAP measures. |
(11) | Common Equity Tier 1 risk-based capital (standardized, fully phased-in basis) is a non-GAAP financial measure that is used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies as if the transition provisions of the U.S. Basel III rules were fully phased in for the periods in which the ratio is disclosed. Management reviews this ratio, which excludes accumulated other comprehensive loss, along with other measures of capital as part of its financial analyses and has included this non-GAAP information because of current interest in such information by market participants. Please refer to Exhibit 14 for a reconciliation between certain GAAP amounts and these non-GAAP measures. |
(12) | Criticized loans held for investment reflects loans in the commercial portfolio segment that are monitored for credit quality based on internal ratings. Amounts exclude small business loans, which are monitored by business credit score and delinquency status. |
(13) | The allowance for credit losses ratios include the allowances for loan losses and for losses on unfunded credit commitments as a percentage of end of period total loans held for investment or total nonaccrual loans, as appropriate. |
(14) | Fees from affiliates represent income resulting from the business integration initiative effective July 1, 2014, whereby BTMU integrated its U.S. branch banking operations, including its employees, under the Bank's operations. The Bank and BTMU participate in a master services agreement whereby the Bank provides BTMU with support services in exchange for fee income. |
(15) | Average balances on loans held for investment include all nonaccrual loans. The amortized portion of net loan origination fees (costs) is included in interest income on loans, representing an adjustment to the yield. |
(16) | Includes noninterest bearing trading account assets. |
(17) | Includes interest bearing trading liabilities. |
(18) | Includes noninterest bearing trading account liabilities. |
(19) | Excludes loans totaling $16 million, $28 million, $16 million, $30 million, and $36 million that are 90 days or more past due and still accruing at June 30, 2016, March 31, 2016, December 31, 2015, September 30, 2015, and June 30, 2015, respectively, which consist of loans accounted for within loan pools in accordance with the accounting standards for purchased credit-impaired loans. The past due status of individual loans within the pools is not a meaningful indicator of credit quality, as potential credit losses are measured at the loan pool level. |
(20) | Carrying amount reflects amortized cost except for balances transferred from available for sale to held to maturity securities. Those balances reflect amortized cost plus any unrealized gains or losses at the date of transfer. |
nm = not meaningful
Exhibit 16 |