Exhibit 99.1
For Immediate Release
For more information:
Jefferson Harralson
Chief Financial Officer
(706) 781-2265
Jefferson_Harralson@ucbi.com
UNITED COMMUNITY BANKS, INC.
ANNOUNCES THIRD QUARTER EARNINGS
Diluted earnings per share up six percent, to 38 cents, from third quarter 2016
Excluding merger-related and other non-operating charges,
diluted operating EPS up five percent, to 41 cents
● | Net interest revenue of $89.8 million, up $10.8 million or 14 percent from year ago |
● | Net interest margin of 3.54 percent, up seven basis points from second quarter and up 20 basis points from year ago |
● | Return on assets of 1.01 percent, or 1.09 percent excluding merger-related and other charges |
● | Efficiency ratio of 59.3 percent, or 56.2 percent excluding merger-related and other charges |
● | Completed the acquisition of Horry County State Bank during the quarter |
BLAIRSVILLE, GA – October 25, 2017 – United Community Banks, Inc. (NASDAQ: UCBI) (“United”) today announced strong third quarter results with meaningful margin expansion, disciplined expense management and sound credit quality. Net income was $27.9 million, or 38 cents per diluted share, compared with $25.9 million, or 36 cents per diluted share, for the third quarter of 2016.
On an operating basis, net income rose to $30.2 million for the third quarter of 2017 compared with $27.8 million for the third quarter of 2016. Third quarter 2017 operating net income excludes merger-related and other non-operating charges totaling $2.27 million, net of the associated income tax benefit. Third quarter 2016 operating net income excludes $1.96 million in merger-related charges, net of the associated income tax benefit. On a per diluted share basis, operating net income was 41 cents for the third quarter of 2017 compared with 39 cents for the third quarter of 2016.
At September 30, 2017, preliminary regulatory capital ratios were as follows. Tier 1 Risk-Based of 12.3 percent; Total Risk-Based of 13.0 percent; Common Equity Tier 1 Risk-Based of 12.2 percent, and Tier 1 Leverage of 9.3 percent.
“Our third quarter results demonstrate United bankers’ ability to overcome challenges and produce solid financial results,” said Jimmy Tallent, chairman and chief executive officer. “In the third quarter, we became subject to the Durbin amendment of the Dodd Frank Wall Street Reform and Consumer Protection Act which places a cap on the amount banks can charge merchants for debit card interchange fees. We also became subject to the large bank deposit insurance assessment model. The combined effect of these two items reduced our pre-tax earnings by approximately $3.4 million, or three cents per share, in the third quarter. We had been actively preparing for this for two years and our bankers were able to completely offset the impact through a higher net interest margin and disciplined expense controls.
“Despite these challenges and excluding merger-related and other non-operating charges, our third quarter operating efficiency ratio held steady at 56.2 percent, our best in more than a decade,” Tallent stated. “Including merger and other non-operating charges, the efficiency ratio was 59.3 percent. Clearly our bankers delivered solid financial performance by every measure.”
Tallent continued, “We also completed the acquisition of Horry County State Bank on July 31st, significantly enhancing our presence in the Myrtle Beach area along the South Carolina coast. The acquisition of Horry County State Bank, which is part of our larger, ongoing expansion strategy in the high-growth South Carolina coast will accelerate our growth in this attractive market. We are all set for systems conversions in mid-November at which time we expect to achieve all of our cost savings.
“We are scheduled to complete our acquisition of Four Oaks Bank & Trust Company on November 1st which will extend our footprint farther east in North Carolina to the fast-growing Raleigh MSA. All regulatory and shareholder approvals for the transaction have been received. We have long sought to enter this market and are delighted to find an exceptional partner in Four Oaks. I could not be more pleased with these two partnerships and look forward to them becoming part of United.
“Third quarter loan production was $617 million with $434 million originating from our community banks and $183 million from our Commercial Banking Solutions group,” Tallent added. “Linked-quarter loans were up $162 million, mostly reflecting the $216 million in net loans received through our acquisition of Horry County State Bank. Our indirect auto loan portfolio was down $48.7 million from second quarter reflecting our decision to suspend indirect auto loan purchases. Excluding the reduction in indirect auto loans and the loans acquired through the Horry acquisition, loan growth was essentially flat from second quarter.”
Third quarter net interest revenue totaled $89.8 million, up $10.8 million from the third quarter of 2016 and up $4.6 million from the second quarter. The increases from both periods reflect business growth and net interest margin expansions of 20 basis points from a year ago and seven basis points from the second quarter, mostly driven by rising short-term interest rates as well as the acquisition of Horry County State Bank which was completed on July 31, 2017. Horry County State Bank results are included in United’s financial results from the acquisition date.
The third quarter provision for credit losses was $1 million, up from $800,000 for the second quarter. This compares with a provision recovery of $300,000 in the third quarter of 2016. Third quarter net charge-offs totaled $1.6 million, equal to the second quarter of 2017 but up slightly from $1.4 million in the third quarter of 2016. Contributing to the low level of net charge-offs were continued strong recoveries of previously charged-off loans. Nonperforming assets were .23 percent of total assets at September 30, 2017, compared with .30 percent at September 30, 2016 and .24 percent at June 30, 2017.
“We continue to experience strong, steady credit quality and a low level of net charge-offs which is reflected in our low provision for loan losses,” Tallent commented. “Our credit quality indicators show no indication of credit deterioration and our outlook is for that to continue. We also expect our provision levels to gradually increase during the year due to loan growth, while our allowance and the related ratio to total loans will decline slightly.”
Third quarter fee revenue totaled $20.6 million, down $5.79 million from a year ago and down $3.11 million from the second quarter. The decrease from both prior periods was mostly due to lower debit card interchange fees as a result of the Durbin amendment becoming effective for United on July 1st. The Durbin amendment, which places a cap on the amount of interchange banks can charge merchants for use of their debit cards, reduced United’s debit card interchange fees by approximately $2.7 million in the third quarter. Also contributing to the decrease from both prior periods were lower mortgage fees and lower customer derivative fees reflecting a less favorable interest rate environment.
Operating expenses were $65.7 million for the third quarter, compared with $64.0 million for the third quarter of 2016 and $63.2 million for the second quarter. Included in the third quarter’s operating expenses are $2.3 million in merger-related expenses and $1.1 million in surplus property impairment charges, totaling $3.4 million. We also had merger-related charges of $3.15 million in the third quarter of 2016, and merger-related and executive retirement charges totaling $1.83 million in the second quarter of 2017. Excluding these charges, third quarter operating expenses were $62.3 million compared with $61.4 million for the second quarter and $60.9 million a year ago. The $855,000 increase from the second quarter was mostly due to higher deposit insurance costs as a result of being assessed under the large bank deposit insurance assessment model effective July 1, and the operating expenses of Horry County State Bank acquired on July 31. These increases were partially offset by lower communications and equipment and advertising and public relations expense.
Tallent concluded, “Our bankers always meet every challenge with diligence and perseverance. That was certainly demonstrated with our third quarter financial results. Their passion and commitment drive our performance and ensure our success. Every day I become more encouraged about the opportunities that lie ahead knowing that our exceptional team of bankers will find success in everything they do. With Horry County State Bank and Four Oaks Bank & Trust Company, we have found two outstanding strategic partners in key growth markets that share our passion for banking and our commitment to customer service. I am excited about the opportunities that these acquisitions create to recruit other talented bankers from within these markets into the United family.”
Conference Call
United will hold a conference call today, Wednesday, October 25, 2017, at 11 a.m. ET to discuss the contents of this earnings release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the conference number 90798221. The conference call also will be webcast and available for replay for 30 days by selecting “Events & Presentations” within the Investor Relations section of United’s website at www.ucbi.com.
About United Community Banks, Inc.
United Community Banks, Inc. (NASDAQ: UCBI) is a bank holding company based in Blairsville, Georgia with $11.1 billion in assets. The company’s banking subsidiary, United Community Bank, is one of the southeast region’s largest full-service banks, operating 142 offices in Georgia, North Carolina, South Carolina and Tennessee. The bank specializes in personalized community banking services for individuals, small businesses and corporations. Services include a full range of consumer and commercial banking products including mortgage, advisory, and treasury management. Respected national research firms consistently recognize United Community Bank for outstanding customer service. For the last four years, J.D. Power has ranked United Community Bank first in customer satisfaction in the Southeast. In 2017, for the fourth consecutive year,Forbes magazine included United on its list of the 100 Best Banks in America. Additional information about the company and the bank’s full range of products and services can be found at www.ucbi.com.
Non-GAAP Financial Measures
This News Release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP. This financial information includes certain operating performance measures, which exclude merger-related and other charges that are not considered part of recurring operations, such as “operating net income,” “operating net income per diluted share,” “operating net income available to common shareholders,” “operating diluted income per common share,” “tangible book value per common share,” “operating return on common equity,” “operating return on tangible common equity,” “operating return on assets,” “operating dividend payout ratio,” “operating efficiency ratio,” “average tangible equity to average assets,” “average tangible common equity to average assets” and “tangible common equity to risk-weighted assets.” These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United’s underlying performance trends. These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.
Safe Harbor
This News Release contains forward-looking statements, as defined by federal securities laws, including statements about United’s financial outlook and business environment. These statements are based on current expectations and are provided to assist in the understanding of future financial performance. Such performance involves risks and uncertainties that may cause actual results to differ materially from those expressed or implied in any such statements. For a discussion of some of the risks and other factors that may cause such forward-looking statements to differ materially from actual results, please refer to United’s filings with the Securities and Exchange Commission, including our 2016 Annual Report on Form 10-K under the sections entitled “Forward-Looking Statements” and “Risk Factors.” Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements.
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UNITED COMMUNITY BANKS, INC. | |||||||||||||||||||
Financial Highlights | |||||||||||||||||||
Selected Financial Information | |||||||||||||||||||
Third | For the Nine | |||||||||||||||||||||||||||||||||||
2017 | 2016 | Quarter | Months Ended | YTD | ||||||||||||||||||||||||||||||||
Third | Second | First | Fourth | Third | 2017-2016 | September 30, | 2017-2016 | |||||||||||||||||||||||||||||
(in thousands, except per share data) | Quarter | Quarter | Quarter | Quarter | Quarter | Change | 2017 | 2016 | Change | |||||||||||||||||||||||||||
INCOME SUMMARY | ||||||||||||||||||||||||||||||||||||
Interest revenue | $ | 98,839 | $ | 93,166 | $ | 90,958 | $ | 87,778 | $ | 85,439 | $ | 282,963 | $ | 247,242 | ||||||||||||||||||||||
Interest expense | 9,064 | 8,018 | 7,404 | 6,853 | 6,450 | 24,486 | 18,383 | |||||||||||||||||||||||||||||
Net interest revenue | 89,775 | 85,148 | 83,554 | 80,925 | 78,989 | 14 | % | 258,477 | 228,859 | 13 | % | |||||||||||||||||||||||||
Provision for credit losses | 1,000 | 800 | 800 | - | (300 | ) | 2,600 | (800 | ) | |||||||||||||||||||||||||||
Fee revenue | 20,573 | 23,685 | 22,074 | 25,233 | 26,361 | (22 | ) | 66,332 | 68,464 | (3 | ) | |||||||||||||||||||||||||
Total revenue | 109,348 | 108,033 | 104,828 | 106,158 | 105,650 | 4 | 322,209 | 298,123 | 8 | |||||||||||||||||||||||||||
Expenses | 65,674 | 63,229 | 62,826 | 61,321 | 64,023 | 3 | 191,729 | 179,968 | 7 | |||||||||||||||||||||||||||
Income before income tax expense | 43,674 | 44,804 | 42,002 | 44,837 | 41,627 | 5 | 130,480 | 118,155 | 10 | |||||||||||||||||||||||||||
Income tax expense | 15,728 | 16,537 | 18,478 | 17,616 | 15,753 | - | 50,743 | 44,720 | 13 | |||||||||||||||||||||||||||
Net income | 27,946 | 28,267 | 23,524 | 27,221 | 25,874 | 8 | 79,737 | 73,435 | 9 | |||||||||||||||||||||||||||
Merger-related and other charges | 3,420 | 1,830 | 2,054 | 1,141 | 3,152 | 7,304 | 6,981 | |||||||||||||||||||||||||||||
Income tax benefit of merger-related and other charges | (1,147 | ) | (675 | ) | (758 | ) | (432 | ) | (1,193 | ) | (2,580 | ) | (2,642 | ) | ||||||||||||||||||||||
Impairment of deferred tax asset on canceled non-qualified stock options | - | - | - | 976 | - | - | - | |||||||||||||||||||||||||||||
Release of disproportionate tax effects lodged in OCI | - | - | 3,400 | - | - | 3,400 | - | |||||||||||||||||||||||||||||
Net income - operating(1) | $ | 30,219 | $ | 29,422 | $ | 28,220 | $ | 28,906 | $ | 27,833 | 9 | $ | 87,861 | $ | 77,774 | 13 | ||||||||||||||||||||
PERFORMANCE MEASURES | ||||||||||||||||||||||||||||||||||||
Per common share: | ||||||||||||||||||||||||||||||||||||
Diluted net income - GAAP | $ | .38 | $ | .39 | $ | .33 | $ | .38 | $ | .36 | 6 | $ | 1.10 | $ | 1.02 | 8 | ||||||||||||||||||||
Diluted net income - operating (1) | .41 | .41 | .39 | .40 | .39 | 5 | 1.21 | 1.08 | 12 | |||||||||||||||||||||||||||
Cash dividends declared | .10 | .09 | .09 | .08 | .08 | .28 | .22 | |||||||||||||||||||||||||||||
Book value | 16.50 | 15.83 | 15.40 | 15.06 | 15.12 | 9 | 16.50 | 15.12 | 9 | |||||||||||||||||||||||||||
Tangible book value(3) | 14.11 | 13.74 | 13.30 | 12.95 | 13.00 | 9 | 14.11 | 13.00 | 9 | |||||||||||||||||||||||||||
Key performance ratios: | ||||||||||||||||||||||||||||||||||||
Return on common equity - GAAP(2)(4) | 9.22 | % | 9.98 | % | 8.54 | % | 9.89 | % | 9.61 | % | 9.26 | % | 9.25 | % | ||||||||||||||||||||||
Return on common equity - operating(1)(2)(4) | 9.97 | 10.39 | 10.25 | 10.51 | 10.34 | 10.20 | 9.79 | |||||||||||||||||||||||||||||
Return on tangible common equity - operating(1)(2)(3)(4) | 11.93 | 12.19 | 12.10 | 12.47 | 12.45 | 12.07 | 11.64 | |||||||||||||||||||||||||||||
Return on assets - GAAP(4) | 1.01 | 1.06 | .89 | 1.03 | 1.00 | .99 | .99 | |||||||||||||||||||||||||||||
Return on assets - operating(1)(4) | 1.09 | 1.10 | 1.07 | 1.10 | 1.08 | 1.09 | 1.05 | |||||||||||||||||||||||||||||
Dividend payout ratio - GAAP | 26.32 | 23.08 | 27.27 | 21.05 | 22.22 | 25.45 | 21.57 | |||||||||||||||||||||||||||||
Dividend payout ratio - operating(1) | 24.39 | 21.95 | 23.08 | 20.00 | 20.51 | 23.14 | 20.37 | |||||||||||||||||||||||||||||
Net interest margin (fully taxable equivalent)(4) | 3.54 | 3.47 | 3.45 | 3.34 | 3.34 | 3.49 | 3.36 | |||||||||||||||||||||||||||||
Efficiency ratio - GAAP | 59.27 | 57.89 | 59.29 | 57.65 | 60.78 | 58.81 | 60.56 | |||||||||||||||||||||||||||||
Efficiency ratio - operating (1) | 56.18 | 56.21 | 57.35 | 56.58 | 57.79 | 56.57 | 58.21 | |||||||||||||||||||||||||||||
Average equity to average assets | 10.86 | 10.49 | 10.24 | 10.35 | 10.38 | 10.54 | 10.60 | |||||||||||||||||||||||||||||
Average tangible equity to average assets(3) | 9.45 | 9.23 | 8.96 | 9.04 | 8.98 | 9.21 | 9.27 | |||||||||||||||||||||||||||||
Average tangible common equity to average assets(3) | 9.45 | 9.23 | 8.96 | 9.04 | 8.98 | 9.21 | 9.24 | |||||||||||||||||||||||||||||
Tangible common equity to risk-weighted assets(3)(5) | 12.81 | 12.44 | 12.07 | 11.84 | 12.22 | 12.81 | 12.22 | |||||||||||||||||||||||||||||
ASSET QUALITY | ||||||||||||||||||||||||||||||||||||
Nonperforming loans | $ | 22,921 | $ | 23,095 | $ | 19,812 | $ | 21,539 | $ | 21,572 | 6 | $ | 22,921 | $ | 21,572 | 6 | ||||||||||||||||||||
Foreclosed properties | 2,736 | 2,739 | 5,060 | 7,949 | 9,187 | (70 | ) | 2,736 | 9,187 | (70 | ) | |||||||||||||||||||||||||
Total nonperforming assets (NPAs) | 25,657 | 25,834 | 24,872 | 29,488 | 30,759 | (17 | ) | 25,657 | 30,759 | (17 | ) | |||||||||||||||||||||||||
Allowance for loan losses | 58,605 | 59,500 | 60,543 | 61,422 | 62,961 | (7 | ) | 58,605 | 62,961 | (7 | ) | |||||||||||||||||||||||||
Net charge-offs | 1,635 | 1,623 | 1,679 | 1,539 | 1,359 | 20 | 4,937 | 5,227 | (6 | ) | ||||||||||||||||||||||||||
Allowance for loan losses to loans | .81 | % | .85 | % | .87 | % | .89 | % | .94 | % | .81 | % | .94 | % | ||||||||||||||||||||||
Net charge-offs to average loans(4) | .09 | .09 | .10 | .09 | .08 | .09 | .11 | |||||||||||||||||||||||||||||
NPAs to loans and foreclosed properties | .36 | .37 | .36 | .43 | .46 | .36 | .46 | |||||||||||||||||||||||||||||
NPAs to total assets | .23 | .24 | .23 | .28 | .30 | .23 | .30 | |||||||||||||||||||||||||||||
AVERAGE BALANCES($ in millions) | ||||||||||||||||||||||||||||||||||||
Loans | $ | 7,149 | $ | 6,980 | $ | 6,904 | $ | 6,814 | $ | 6,675 | 7 | $ | 7,012 | $ | 6,278 | 12 | ||||||||||||||||||||
Investment securities | 2,800 | 2,775 | 2,822 | 2,690 | 2,610 | 7 | 2,799 | 2,692 | 4 | |||||||||||||||||||||||||||
Earning assets | 10,133 | 9,899 | 9,872 | 9,665 | 9,443 | 7 | 9,969 | 9,120 | 9 | |||||||||||||||||||||||||||
Total assets | 10,980 | 10,704 | 10,677 | 10,484 | 10,281 | 7 | 10,788 | 9,909 | 9 | |||||||||||||||||||||||||||
Deposits | 8,913 | 8,659 | 8,592 | 8,552 | 8,307 | 7 | 8,723 | 8,051 | 8 | |||||||||||||||||||||||||||
Shareholders’ equity | 1,193 | 1,123 | 1,093 | 1,085 | 1,067 | 12 | 1,137 | 1,051 | 8 | |||||||||||||||||||||||||||
Common shares - basic(thousands) | 73,151 | 71,810 | 71,700 | 71,641 | 71,556 | 2 | 72,060 | 71,992 | - | |||||||||||||||||||||||||||
Common shares - diluted(thousands) | 73,162 | 71,820 | 71,708 | 71,648 | 71,561 | 2 | 72,071 | 71,996 | - | |||||||||||||||||||||||||||
AT PERIOD END($ in millions) | ||||||||||||||||||||||||||||||||||||
Loans | $ | 7,203 | $ | 7,041 | $ | 6,965 | $ | 6,921 | $ | 6,725 | 7 | $ | 7,203 | $ | 6,725 | 7 | ||||||||||||||||||||
Investment securities | 2,847 | 2,787 | 2,767 | 2,762 | 2,560 | 11 | 2,847 | 2,560 | 11 | |||||||||||||||||||||||||||
Total assets | 11,129 | 10,837 | 10,732 | 10,709 | 10,298 | 8 | 11,129 | 10,298 | 8 | |||||||||||||||||||||||||||
Deposits | 9,127 | 8,736 | 8,752 | 8,638 | 8,442 | 8 | 9,127 | 8,442 | 8 | |||||||||||||||||||||||||||
Shareholders’ equity | 1,221 | 1,133 | 1,102 | 1,076 | 1,079 | 13 | 1,221 | 1,079 | 13 | |||||||||||||||||||||||||||
Common shares outstanding(thousands) | 73,403 | 70,981 | 70,973 | 70,899 | 70,861 | 4 | 73,403 | 70,861 | 4 |
(1) | Excludes merger-related and other charges which includes amortization of certain executive change of control benefits, a first quarter 2017 release of disproportionate tax effects lodged in OCI and a fourth quarter 2016 deferred tax asset impairment charge related to cancelled non-qualified stock options. |
(2) | Net income available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss). |
(3) | Excludes effect of acquisition related intangibles and associated amortization. |
(4) | Annualized. |
(5) | Third quarter 2017 ratio is preliminary. |
UNITED COMMUNITY BANKS, INC. | ||||||||||||||
Non-GAAP Performance Measures Reconciliation | ||||||||||||||
Selected Financial Information | ||||||||||||||
2017 | 2016 | For the Nine Months Ended | ||||||||||||||||||||||||||
Third | Second | First | Fourth | Third | June 30, | |||||||||||||||||||||||
(in thousands, except per share data) | Quarter | Quarter | Quarter | Quarter | Quarter | 2017 | 2016 | |||||||||||||||||||||
Expense reconciliation | ||||||||||||||||||||||||||||
Expenses (GAAP) | $ | 65,674 | $ | 63,229 | $ | 62,826 | $ | 61,321 | $ | 64,023 | $ | 191,729 | $ | 179,968 | ||||||||||||||
Merger-related and other charges | (3,420 | ) | (1,830 | ) | (2,054 | ) | (1,141 | ) | (3,152 | ) | (7,304 | ) | (6,981 | ) | ||||||||||||||
Expenses - operating | $ | 62,254 | $ | 61,399 | $ | 60,772 | $ | 60,180 | $ | 60,871 | $ | 184,425 | $ | 172,987 | ||||||||||||||
Net income reconciliation | ||||||||||||||||||||||||||||
Net income (GAAP) | $ | 27,946 | $ | 28,267 | $ | 23,524 | $ | 27,221 | $ | 25,874 | $ | 79,737 | $ | 73,435 | ||||||||||||||
Merger-related and other charges | 3,420 | 1,830 | 2,054 | 1,141 | 3,152 | 7,304 | 6,981 | |||||||||||||||||||||
Income tax benefit of merger-related and other charges | (1,147 | ) | (675 | ) | (758 | ) | (432 | ) | (1,193 | ) | (2,580 | ) | (2,642 | ) | ||||||||||||||
Impairment of deferred tax asset on canceled non-qualified stock options | - | - | - | 976 | - | - | - | |||||||||||||||||||||
Release of disproportionate tax effects lodged in OCI | - | - | 3,400 | - | - | 3,400 | - | |||||||||||||||||||||
Net income - operating | $ | 30,219 | $ | 29,422 | $ | 28,220 | $ | 28,906 | $ | 27,833 | $ | 87,861 | $ | 77,774 | ||||||||||||||
Diluted income per common share reconciliation | ||||||||||||||||||||||||||||
Diluted income per common share (GAAP) | $ | .38 | $ | .39 | $ | .33 | $ | .38 | $ | .36 | $ | 1.10 | $ | 1.02 | ||||||||||||||
Merger-related and other charges | .03 | .02 | .01 | .01 | .03 | .06 | - | |||||||||||||||||||||
Impairment of deferred tax asset on canceled non-qualified stock options | - | - | - | .01 | - | - | - | |||||||||||||||||||||
Release of disproportionate tax effects lodged in OCI | - | - | .05 | - | - | .05 | - | |||||||||||||||||||||
Diluted income per common share - operating | $ | .41 | $ | .41 | $ | .39 | $ | .40 | $ | .39 | $ | 1.21 | $ | 1.02 | ||||||||||||||
Book value per common share reconciliation | ||||||||||||||||||||||||||||
Book value per common share (GAAP) | $ | 16.50 | $ | 15.83 | $ | 15.40 | $ | 15.06 | $ | 15.12 | $ | 16.50 | $ | 15.12 | ||||||||||||||
Effect of goodwill and other intangibles | (2.39 | ) | (2.09 | ) | (2.10 | ) | (2.11 | ) | (2.12 | ) | (2.39 | ) | (2.12 | ) | ||||||||||||||
Tangible book value per common share | $ | 14.11 | $ | 13.74 | $ | 13.30 | $ | 12.95 | $ | 13.00 | $ | 14.11 | $ | 13.00 | ||||||||||||||
Return on tangible common equity reconciliation | ||||||||||||||||||||||||||||
Return on common equity (GAAP) | 9.22 | % | 9.98 | % | 8.54 | % | 9.89 | % | 9.61 | % | 9.26 | % | 9.25 | % | ||||||||||||||
Merger-related and other charges | .75 | .41 | .47 | .26 | .73 | .55 | .54 | |||||||||||||||||||||
Impairment of deferred tax asset on canceled non-qualified stock options | - | - | - | .36 | - | - | - | |||||||||||||||||||||
Release of disproportionate tax effects lodged in OCI | - | - | 1.24 | - | - | .39 | - | |||||||||||||||||||||
Return on common equity - operating | 9.97 | 10.39 | 10.25 | 10.51 | 10.34 | 10.20 | 9.79 | |||||||||||||||||||||
Effect of goodwill and other intangibles | 1.96 | 1.80 | 1.85 | 1.96 | 2.11 | 1.87 | 1.85 | |||||||||||||||||||||
Return on tangible common equity - operating | 11.93 | % | 12.19 | % | 12.10 | % | 12.47 | % | 12.45 | % | 12.07 | % | 11.64 | % | ||||||||||||||
Return on assets reconciliation | ||||||||||||||||||||||||||||
Return on assets (GAAP) | 1.01 | % | 1.06 | % | .89 | % | 1.03 | % | 1.00 | % | .99 | % | .99 | % | ||||||||||||||
Merger-related and other charges | .08 | .04 | .05 | .03 | .08 | .06 | .06 | |||||||||||||||||||||
Impairment of deferred tax asset on canceled non-qualified stock options | - | - | - | .04 | - | - | - | |||||||||||||||||||||
Release of disproportionate tax effects lodged in OCI | - | - | .13 | - | - | .04 | - | |||||||||||||||||||||
Return on assets - operating | 1.09 | % | 1.10 | % | 1.07 | % | 1.10 | % | 1.08 | % | 1.09 | % | 1.05 | % | ||||||||||||||
Dividend payout ratio reconciliation | ||||||||||||||||||||||||||||
Dividend payout ratio (GAAP) | 26.32 | % | 23.08 | % | 27.27 | % | 21.05 | % | 22.22 | % | 25.45 | % | 21.57 | % | ||||||||||||||
Merger-related and other charges | (1.93 | ) | (1.13 | ) | (.98 | ) | (.54 | ) | (1.71 | ) | (1.31 | ) | (1.20 | ) | ||||||||||||||
Impairment of deferred tax asset on canceled non-qualified stock options | - | - | - | (.51 | ) | - | - | - | ||||||||||||||||||||
Release of disproportionate tax effects lodged in OCI | - | - | (3.21 | ) | - | - | (1.00 | ) | - | |||||||||||||||||||
Dividend payout ratio - operating | 24.39 | % | 21.95 | % | 23.08 | % | 20.00 | % | 20.51 | % | 23.14 | % | 20.37 | % | ||||||||||||||
Efficiency ratio reconciliation | ||||||||||||||||||||||||||||
Efficiency ratio (GAAP) | 59.27 | % | 57.89 | % | 59.29 | % | 57.65 | % | 60.78 | % | 58.81 | % | 60.56 | % | ||||||||||||||
Merger-related and other charges | (3.09 | ) | (1.68 | ) | (1.94 | ) | (1.07 | ) | (2.99 | ) | (2.24 | ) | (2.35 | ) | ||||||||||||||
Efficiency ratio - operating | 56.18 | % | 56.21 | % | 57.35 | % | 56.58 | % | 57.79 | % | 56.57 | % | 58.21 | % | ||||||||||||||
Average equity to assets reconciliation | ||||||||||||||||||||||||||||
Equity to assets (GAAP) | 10.86 | % | 10.49 | % | 10.24 | % | 10.35 | % | 10.38 | % | 10.54 | % | 10.60 | % | ||||||||||||||
Effect of goodwill and other intangibles | (1.41 | ) | (1.26 | ) | (1.28 | ) | (1.31 | ) | (1.40 | ) | (1.33 | ) | (1.33 | ) | ||||||||||||||
Tangible equity to assets | 9.45 | 9.23 | 8.96 | 9.04 | 8.98 | 9.21 | 9.27 | |||||||||||||||||||||
Effect of preferred equity | - | - | - | - | - | - | (.03 | ) | ||||||||||||||||||||
Tangible common equity to assets | 9.45 | % | 9.23 | % | 8.96 | % | 9.04 | % | 8.98 | % | 9.21 | % | 9.24 | % | ||||||||||||||
Tangible common equity to risk-weighted assets reconciliation(1) | ||||||||||||||||||||||||||||
Tier 1 capital ratio (Regulatory) | 12.27 | % | 11.91 | % | 11.46 | % | 11.23 | % | 11.04 | % | 12.27 | % | 11.04 | % | ||||||||||||||
Effect of other comprehensive income | (.13 | ) | (.15 | ) | (.24 | ) | (.34 | ) | - | (.13 | ) | - | ||||||||||||||||
Effect of deferred tax limitation | .94 | .95 | 1.13 | 1.26 | 1.50 | .94 | 1.50 | |||||||||||||||||||||
Effect of trust preferred | (.24 | ) | (.25 | ) | (.25 | ) | (.25 | ) | (.26 | ) | (.24 | ) | (.26 | ) | ||||||||||||||
Basel III intangibles transition adjustment | (.03 | ) | (.02 | ) | (.03 | ) | (.06 | ) | (.06 | ) | (.03 | ) | (.06 | ) | ||||||||||||||
Tangible common equity to risk-weighted assets | 12.81 | % | 12.44 | % | 12.07 | % | 11.84 | % | 12.22 | % | 12.81 | % | 12.22 | % |
(1) | Third quarter 2017 ratios are preliminary. |
UNITED COMMUNITY BANKS, INC. | ||||||||||||||
Financial Highlights | ||||||||||||||
Loan Portfolio Composition at Period-End | ||||||||||||||
2017 | 2016 | Linked | Year over | |||||||||||||||||||||||||
Third | Second | First | Fourth | Third | Quarter | Year | ||||||||||||||||||||||
(in millions) | Quarter | Quarter | Quarter | Quarter | Quarter | Change | Change | |||||||||||||||||||||
LOANS BY CATEGORY | ||||||||||||||||||||||||||||
Owner occupied commercial RE | $ | 1,792 | $ | 1,723 | $ | 1,633 | $ | 1,650 | $ | 1,587 | $ | 69 | $ | 205 | ||||||||||||||
Income producing commercial RE | 1,413 | 1,342 | 1,297 | 1,282 | 1,277 | 71 | 136 | |||||||||||||||||||||
Commercial & industrial | 1,084 | 1,088 | 1,080 | 1,070 | 994 | (4 | ) | 90 | ||||||||||||||||||||
Commercial construction | 583 | 587 | 667 | 634 | 567 | (4 | ) | 16 | ||||||||||||||||||||
Total commercial | 4,872 | 4,740 | 4,677 | 4,636 | 4,425 | 132 | 447 | |||||||||||||||||||||
Residential mortgage | 933 | 881 | 860 | 857 | 814 | 52 | 119 | |||||||||||||||||||||
Home equity lines of credit | 689 | 665 | 659 | 655 | 693 | 24 | (4 | ) | ||||||||||||||||||||
Residential construction | 190 | 193 | 197 | 190 | 200 | (3 | ) | (10 | ) | |||||||||||||||||||
Consumer installment | 519 | 562 | 572 | 583 | 593 | (43 | ) | (74 | ) | |||||||||||||||||||
Total loans | $ | 7,203 | $ | 7,041 | $ | 6,965 | $ | 6,921 | $ | 6,725 | 162 | 478 | ||||||||||||||||
LOANS BY MARKET | ||||||||||||||||||||||||||||
North Georgia | $ | 1,047 | $ | 1,065 | $ | 1,076 | $ | 1,097 | $ | 1,110 | (18 | ) | (63 | ) | ||||||||||||||
Atlanta MSA | 1,477 | 1,445 | 1,408 | 1,399 | 1,332 | 32 | 145 | |||||||||||||||||||||
North Carolina | 542 | 541 | 541 | 545 | 548 | 1 | (6 | ) | ||||||||||||||||||||
Coastal Georgia | 634 | 623 | 591 | 581 | 565 | 11 | 69 | |||||||||||||||||||||
Gainesville MSA | 242 | 246 | 252 | 248 | 236 | (4 | ) | 6 | ||||||||||||||||||||
East Tennessee | 471 | 486 | 483 | 504 | 506 | (15 | ) | (35 | ) | |||||||||||||||||||
South Carolina | 1,470 | 1,260 | 1,243 | 1,233 | 1,199 | 210 | 271 | |||||||||||||||||||||
Commercial Banking Solutions | 920 | 926 | 911 | 855 | 763 | (6 | ) | 157 | ||||||||||||||||||||
Indirect auto | 400 | 449 | 460 | 459 | 466 | (49 | ) | (66 | ) | |||||||||||||||||||
Total loans | $ | 7,203 | $ | 7,041 | $ | 6,965 | $ | 6,921 | $ | 6,725 | 162 | 478 |
UNITED COMMUNITY BANKS, INC. | |||||||||||||||||||||||||||
Financial Highlights | |||||||||||||||||||||||||||
Credit Quality | |||||||||||||||||||||||||||
Third Quarter 2017 | Second Quarter 2017 | First Quarter 2017 | ||||||||||||||||||||||||||||||||||
Nonperforming | Foreclosed | Total | Nonperforming | Foreclosed | Total | Nonperforming | Foreclosed | Total | ||||||||||||||||||||||||||||
(in thousands) | Loans | Properties | NPAs | Loans | Properties | NPAs | Loans | Properties | NPAs | |||||||||||||||||||||||||||
NONPERFORMING ASSETS BY CATEGORY | ||||||||||||||||||||||||||||||||||||
Owner occupied CRE | $ | 5,027 | $ | 764 | $ | 5,791 | $ | 5,248 | $ | 580 | $ | 5,828 | $ | 6,135 | $ | 1,238 | $ | 7,373 | ||||||||||||||||||
Income producing CRE | 2,042 | 121 | 2,163 | 2,587 | - | 2,587 | 1,540 | 21 | 1,561 | |||||||||||||||||||||||||||
Commercial & industrial | 2,378 | - | 2,378 | 1,010 | - | 1,010 | 929 | - | 929 | |||||||||||||||||||||||||||
Commercial construction | 1,376 | 923 | 2,299 | 2,530 | 611 | 3,141 | 1,069 | 2,825 | 3,894 | |||||||||||||||||||||||||||
Total commercial | 10,823 | 1,808 | 12,631 | 11,375 | 1,191 | 12,566 | 9,673 | 4,084 | 13,757 | |||||||||||||||||||||||||||
Residential mortgage | 8,559 | 392 | 8,951 | 7,886 | 457 | 8,343 | 6,455 | 660 | 7,115 | |||||||||||||||||||||||||||
Home equity lines of credit | 1,898 | 195 | 2,093 | 2,152 | 201 | 2,353 | 1,848 | 261 | 2,109 | |||||||||||||||||||||||||||
Residential construction | 178 | 341 | 519 | 287 | 890 | 1,177 | 417 | 55 | 472 | |||||||||||||||||||||||||||
Consumer installment | 1,463 | - | 1,463 | 1,395 | - | 1,395 | 1,419 | - | 1,419 | |||||||||||||||||||||||||||
Total NPAs | $ | 22,921 | $ | 2,736 | $ | 25,657 | $ | 23,095 | $ | 2,739 | $ | 25,834 | $ | 19,812 | $ | 5,060 | $ | 24,872 | ||||||||||||||||||
NONPERFORMING ASSETS BY MARKET | ||||||||||||||||||||||||||||||||||||
North Georgia | $ | 6,707 | $ | 404 | $ | 7,111 | $ | 5,449 | $ | 225 | $ | 5,674 | $ | 5,344 | $ | 570 | $ | 5,914 | ||||||||||||||||||
Atlanta MSA | 1,098 | 338 | 1,436 | 906 | 423 | 1,329 | 715 | 645 | 1,360 | |||||||||||||||||||||||||||
North Carolina | 4,376 | 318 | 4,694 | 4,700 | 472 | 5,172 | 4,897 | 355 | 5,252 | |||||||||||||||||||||||||||
Coastal Georgia | 2,532 | - | 2,532 | 2,542 | - | 2,542 | 942 | - | 942 | |||||||||||||||||||||||||||
Gainesville MSA | 763 | - | 763 | 622 | - | 622 | 728 | - | 728 | |||||||||||||||||||||||||||
East Tennessee | 1,734 | 67 | 1,801 | 2,216 | 103 | 2,319 | 2,112 | 633 | 2,745 | |||||||||||||||||||||||||||
South Carolina | 1,903 | 1,609 | 3,512 | 3,472 | 1,516 | 4,988 | 1,725 | 2,857 | 4,582 | |||||||||||||||||||||||||||
Commercial Banking Solutions | 2,429 | - | 2,429 | 1,914 | - | 1,914 | 2,032 | - | 2,032 | |||||||||||||||||||||||||||
Indirect auto | 1,379 | - | 1,379 | 1,274 | - | 1,274 | 1,317 | - | 1,317 | |||||||||||||||||||||||||||
Total NPAs | $ | 22,921 | $ | 2,736 | $ | 25,657 | $ | 23,095 | $ | 2,739 | $ | 25,834 | $ | 19,812 | $ | 5,060 | $ | 24,872 | ||||||||||||||||||
NONPERFORMING ASSETS ACTIVITY | ||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | 23,095 | $ | 2,739 | $ | 25,834 | $ | 19,812 | $ | 5,060 | $ | 24,872 | $ | 21,539 | $ | 7,949 | $ | 29,488 | ||||||||||||||||||
Acquisitions | 20 | 805 | 825 | - | - | - | - | - | - | |||||||||||||||||||||||||||
Loans placed on non-accrual | 7,964 | - | 7,964 | 8,110 | - | 8,110 | 3,172 | - | 3,172 | |||||||||||||||||||||||||||
Payments received | (5,192 | ) | - | (5,192 | ) | (2,955 | ) | - | (2,955 | ) | (3,046 | ) | - | (3,046 | ) | |||||||||||||||||||||
Loan charge-offs | (2,159 | ) | - | (2,159 | ) | (1,564 | ) | - | (1,564 | ) | (1,292 | ) | - | (1,292 | ) | |||||||||||||||||||||
Foreclosures | (807 | ) | 683 | (124 | ) | (308 | ) | 481 | 173 | (561 | ) | 561 | - | |||||||||||||||||||||||
Property sales | - | (1,295 | ) | (1,295 | ) | - | (2,704 | ) | (2,704 | ) | - | (3,077 | ) | (3,077 | ) | |||||||||||||||||||||
Write downs | - | (236 | ) | (236 | ) | - | (294 | ) | (294 | ) | - | (480 | ) | (480 | ) | |||||||||||||||||||||
Net gains (losses) on sales | - | 40 | 40 | - | 196 | 196 | - | 107 | 107 | |||||||||||||||||||||||||||
Ending Balance | $ | 22,921 | $ | 2,736 | $ | 25,657 | $ | 23,095 | $ | 2,739 | $ | 25,834 | $ | 19,812 | $ | 5,060 | $ | 24,872 |
Third Quarter 2017 | Second Quarter 2017 | First Quarter 2017 | ||||||||||||||||||||||
Net Charge- | Net Charge- | Net Charge- | ||||||||||||||||||||||
Offs to | Offs to | Offs to | ||||||||||||||||||||||
Net | Average | Net | Average | Net | Average | |||||||||||||||||||
(in thousands) | Charge-Offs | Loans(1) | Charge-Offs | Loans(1) | Charge-Offs | Loans(1) | ||||||||||||||||||
NET CHARGE-OFFS BY CATEGORY | ||||||||||||||||||||||||
Owner occupied CRE | $ | (44 | ) | (.01 | )% | $ | 37 | .01 | % | $ | (212 | ) | (.05 | )% | ||||||||||
Income producing CRE | 1,159 | .33 | 184 | .06 | 870 | .28 | ||||||||||||||||||
Commercial & industrial | (200 | ) | (.08 | ) | 354 | .13 | (152 | ) | (.06 | ) | ||||||||||||||
Commercial construction | (114 | ) | (.07 | ) | 341 | .22 | (370 | ) | (.23 | ) | ||||||||||||||
Total commercial | 801 | .07 | 916 | .08 | 136 | .01 | ||||||||||||||||||
Residential mortgage | 313 | .14 | 26 | .01 | 530 | .25 | ||||||||||||||||||
Home equity lines of credit | 56 | .03 | 253 | .15 | 422 | .26 | ||||||||||||||||||
Residential construction | 36 | .07 | (53 | ) | (.11 | ) | (9 | ) | (.02 | ) | ||||||||||||||
Consumer installment | 429 | .31 | 481 | .34 | 600 | .42 | ||||||||||||||||||
Total | $ | 1,635 | .09 | $ | 1,623 | .09 | $ | 1,679 | .10 | |||||||||||||||
NET CHARGE-OFFS BY MARKET | ||||||||||||||||||||||||
North Georgia | $ | 516 | .19 | % | $ | 681 | .26 | % | $ | 15 | .01 | % | ||||||||||||
Atlanta MSA | 150 | .04 | (10 | ) | - | (46 | ) | (.01 | ) | |||||||||||||||
North Carolina | 221 | .16 | 131 | .10 | 601 | .45 | ||||||||||||||||||
Coastal Georgia | (39 | ) | (.02 | ) | 120 | .08 | (223 | ) | (.15 | ) | ||||||||||||||
Gainesville MSA | (50 | ) | (.08 | ) | (54 | ) | (.09 | ) | 358 | .58 | ||||||||||||||
East Tennessee | 55 | .05 | 27 | .02 | 55 | .05 | ||||||||||||||||||
South Carolina | 528 | .15 | 526 | .17 | 425 | .14 | ||||||||||||||||||
Commercial Banking Solutions | (7 | ) | - | (17 | ) | (.01 | ) | 195 | .09 | |||||||||||||||
Indirect auto | 261 | .24 | 219 | .19 | 299 | .27 | ||||||||||||||||||
Total | $ | 1,635 | .09 | $ | 1,623 | .09 | $ | 1,679 | .10 |
(1) | Annualized. |
UNITED COMMUNITY BANKS, INC. | ||||||||
Consolidated Statement of Income(Unaudited) | ||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(in thousands, except per share data) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Interest revenue: | ||||||||||||||||
Loans, including fees | $ | 80,264 | $ | 69,440 | $ | 227,816 | $ | 196,888 | ||||||||
Investment securities, including tax exempt of $671, $134, $1,307, and $449 | 17,875 | 15,418 | 53,365 | 48,039 | ||||||||||||
Deposits in banks and short-term investments | 700 | 581 | 1,782 | 2,315 | ||||||||||||
Total interest revenue | 98,839 | 85,439 | 282,963 | 247,242 | ||||||||||||
Interest expense: | ||||||||||||||||
Deposits: | ||||||||||||||||
NOW | 700 | 452 | 1,932 | 1,381 | ||||||||||||
Money market | 1,953 | 1,347 | 4,938 | 3,661 | ||||||||||||
Savings | 34 | 43 | 89 | 102 | ||||||||||||
Time | 1,870 | 667 | 4,257 | 2,052 | ||||||||||||
Total deposit interest expense | 4,557 | 2,509 | 11,216 | 7,196 | ||||||||||||
Short-term borrowings | 36 | 98 | 177 | 278 | ||||||||||||
Federal Home Loan Bank advances | 1,709 | 1,015 | 4,603 | 2,731 | ||||||||||||
Long-term debt | 2,762 | 2,828 | 8,490 | 8,178 | ||||||||||||
Total interest expense | 9,064 | 6,450 | 24,486 | 18,383 | ||||||||||||
Net interest revenue | 89,775 | 78,989 | 258,477 | 228,859 | ||||||||||||
(Release of) provision for credit losses | 1,000 | (300 | ) | 2,600 | (800 | ) | ||||||||||
Net interest revenue after provision for credit losses | 88,775 | 79,289 | 255,877 | 229,659 | ||||||||||||
Fee revenue: | ||||||||||||||||
Service charges and fees | 8,220 | 10,819 | 29,525 | 31,460 | ||||||||||||
Mortgage loan and other related fees | 4,200 | 6,039 | 13,435 | 13,776 | ||||||||||||
Brokerage fees | 1,009 | 1,199 | 3,565 | 3,369 | ||||||||||||
Gains from sales of SBA/USDA loans | 2,806 | 2,479 | 7,391 | 6,517 | ||||||||||||
Securities gains, net | 188 | 261 | 190 | 922 | ||||||||||||
Other | 4,150 | 5,564 | 12,226 | 12,420 | ||||||||||||
Total fee revenue | 20,573 | 26,361 | 66,332 | 68,464 | ||||||||||||
Total revenue | 109,348 | 105,650 | 322,209 | 298,123 | ||||||||||||
Operating expenses: | ||||||||||||||||
Salaries and employee benefits | 38,027 | 36,478 | 112,056 | 103,112 | ||||||||||||
Communications and equipment | 4,547 | 4,919 | 14,443 | 13,602 | ||||||||||||
Occupancy | 4,945 | 5,132 | 14,802 | 14,393 | ||||||||||||
Advertising and public relations | 1,026 | 1,088 | 3,347 | 3,275 | ||||||||||||
Postage, printing and supplies | 1,411 | 1,451 | 4,127 | 4,029 | ||||||||||||
Professional fees | 2,976 | 3,160 | 8,391 | 9,049 | ||||||||||||
FDIC assessments and other regulatory charges | 2,127 | 1,412 | 4,758 | 4,453 | ||||||||||||
Amortization of intangibles | 1,212 | 1,119 | 3,085 | 3,116 | ||||||||||||
Merger-related and other charges | 3,176 | 3,152 | 7,060 | 6,981 | ||||||||||||
Other | 6,227 | 6,112 | 19,660 | 17,958 | ||||||||||||
Total operating expenses | 65,674 | 64,023 | 191,729 | 179,968 | ||||||||||||
Net income before income taxes | 43,674 | 41,627 | 130,480 | 118,155 | ||||||||||||
Income tax expense | 15,728 | 15,753 | 50,743 | 44,720 | ||||||||||||
Net income | $ | 27,946 | $ | 25,874 | $ | 79,737 | $ | 73,435 | ||||||||
Net income available to common shareholders | $ | 27,719 | $ | 25,874 | $ | 79,078 | $ | 73,414 | ||||||||
Earnings per common share: | ||||||||||||||||
Basic | $ | .38 | $ | .36 | $ | 1.10 | $ | 1.02 | ||||||||
Diluted | .38 | .36 | 1.10 | 1.02 | ||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic | 73,151 | 71,556 | 72,060 | 71,992 | ||||||||||||
Diluted | 73,162 | 71,561 | 72,071 | 71,996 |
UNITED COMMUNITY BANKS, INC. | ||||
Consolidated Balance Sheet(Unaudited) | ||||
September 30, | December 31, | |||||||
(in thousands, except share and per share data) | 2017 | 2016 | ||||||
ASSETS | ||||||||
Cash and due from banks | $ | 98,396 | $ | 99,489 | ||||
Interest-bearing deposits in banks | 148,449 | 117,859 | ||||||
Cash and cash equivalents | 246,845 | 217,348 | ||||||
Securities available for sale | 2,540,470 | 2,432,438 | ||||||
Securities held to maturity (fair value $310,446 and $333,170) | 306,741 | 329,843 | ||||||
Mortgage loans held for sale (includes $30,093 and $27,891 at fair value) | 30,292 | 29,878 | ||||||
Loans, net of unearned income | 7,202,937 | 6,920,636 | ||||||
Less allowance for loan losses | (58,605 | ) | (61,422 | ) | ||||
Loans, net | 7,144,332 | 6,859,214 | ||||||
Premises and equipment, net | 193,915 | 189,938 | ||||||
Bank owned life insurance | 167,680 | 143,543 | ||||||
Accrued interest receivable | 29,573 | 28,018 | ||||||
Net deferred tax asset | 128,731 | 154,336 | ||||||
Derivative financial instruments | 20,972 | 23,688 | ||||||
Goodwill and other intangible assets | 182,716 | 156,222 | ||||||
Other assets | 136,760 | 144,189 | ||||||
Total assets | $ | 11,129,027 | $ | 10,708,655 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
Liabilities: | ||||||||
Deposits: | ||||||||
Demand | $ | 2,918,428 | $ | 2,637,004 | ||||
NOW | 1,938,352 | 1,989,763 | ||||||
Money market | 1,934,169 | 1,846,440 | ||||||
Savings | 605,230 | 549,713 | ||||||
Time | 1,363,949 | 1,287,142 | ||||||
Brokered | 367,256 | 327,496 | ||||||
Total deposits | 9,127,384 | 8,637,558 | ||||||
Short-term borrowings | 16,005 | 5,000 | ||||||
Federal Home Loan Bank advances | 494,484 | 709,209 | ||||||
Long-term debt | 135,707 | 175,078 | ||||||
Derivative financial instruments | 22,926 | 27,648 | ||||||
Accrued expenses and other liabilities | 111,881 | 78,427 | ||||||
Total liabilities | 9,908,387 | 9,632,920 | ||||||
Shareholders' equity: | ||||||||
Common stock, $1 par value; 150,000,000 shares authorized; | ||||||||
73,403,453 and 70,899,114 shares issued and outstanding | 73,403 | 70,899 | ||||||
Common stock issuable; 588,445 and 519,874 shares | 8,703 | 7,327 | ||||||
Capital surplus | 1,341,346 | 1,275,849 | ||||||
Accumulated deficit | (192,128 | ) | (251,857 | ) | ||||
Accumulated other comprehensive loss | (10,684 | ) | (26,483 | ) | ||||
Total shareholders' equity | 1,220,640 | 1,075,735 | ||||||
Total liabilities and shareholders' equity | $ | 11,129,027 | $ | 10,708,655 |
UNITED COMMUNITY BANKS, INC. | |||||||||||
Average Consolidated Balance Sheets and Net Interest Analysis | |||||||||||
For the Three Months Ended September 30, | |||||||||||
2017 | 2016 | |||||||||||||||||||||||
Average | Avg. | Average | Avg. | |||||||||||||||||||||
(dollars in thousands, fully taxable equivalent (FTE)) | Balance | Interest | Rate | Balance | Interest | Rate | ||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loans, net of unearned income (FTE)(1)(2) | $ | 7,149,348 | $ | 80,301 | 4.46 | % | $ | 6,675,328 | $ | 69,427 | 4.14 | % | ||||||||||||
Taxable securities(3) | 2,695,162 | 17,204 | 2.55 | 2,588,037 | 15,284 | 2.36 | ||||||||||||||||||
Tax-exempt securities (FTE)(1)(3) | 105,151 | 1,098 | 4.18 | 22,113 | 219 | 3.96 | ||||||||||||||||||
Federal funds sold and other interest-earning assets | 183,170 | 883 | 1.93 | 157,972 | 754 | 1.91 | ||||||||||||||||||
Total interest-earning assets (FTE) | 10,132,831 | 99,486 | 3.90 | 9,443,450 | 85,684 | 3.61 | ||||||||||||||||||
Non-interest-earning assets: | ||||||||||||||||||||||||
Allowance for loan losses | (60,098 | ) | (63,874 | ) | ||||||||||||||||||||
Cash and due from banks | 103,477 | 100,775 | ||||||||||||||||||||||
Premises and equipment | 203,579 | 198,234 | ||||||||||||||||||||||
Other assets(3) | 599,725 | 602,690 | ||||||||||||||||||||||
Total assets | $ | 10,979,514 | $ | 10,281,275 | ||||||||||||||||||||
Liabilities and Shareholders' Equity: | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||||
NOW | $ | 1,863,160 | 700 | .15 | $ | 1,744,473 | 452 | .10 | ||||||||||||||||
Money market | 2,170,148 | 1,953 | .36 | 1,997,165 | 1,347 | .27 | ||||||||||||||||||
Savings | 593,823 | 34 | .02 | 537,447 | 43 | .03 | ||||||||||||||||||
Time | 1,338,786 | 1,548 | .46 | 1,375,706 | 833 | .24 | ||||||||||||||||||
Brokered time deposits | 109,811 | 322 | 1.16 | 162,255 | (166 | ) | (.41 | ) | ||||||||||||||||
Total interest-bearing deposits | 6,075,728 | 4,557 | .30 | 5,817,046 | 2,509 | .17 | ||||||||||||||||||
Federal funds purchased and other borrowings | 11,313 | 36 | 1.26 | 42,234 | 98 | .92 | ||||||||||||||||||
Federal Home Loan Bank advances | 574,404 | 1,709 | 1.18 | 583,312 | 1,015 | .69 | ||||||||||||||||||
Long-term debt | 154,616 | 2,762 | 7.09 | 177,333 | 2,828 | 6.34 | ||||||||||||||||||
Total borrowed funds | 740,333 | 4,507 | 2.42 | 802,879 | 3,941 | 1.95 | ||||||||||||||||||
Total interest-bearing liabilities | 6,816,061 | 9,064 | .53 | 6,619,925 | 6,450 | .39 | ||||||||||||||||||
Non-interest-bearing liabilities: | ||||||||||||||||||||||||
Non-interest-bearing deposits | 2,837,378 | 2,490,019 | ||||||||||||||||||||||
Other liabilities | 133,212 | 103,859 | ||||||||||||||||||||||
Total liabilities | 9,786,651 | 9,213,803 | ||||||||||||||||||||||
Shareholders' equity | 1,192,863 | 1,067,472 | ||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 10,979,514 | $ | 10,281,275 | ||||||||||||||||||||
Net interest revenue (FTE) | $ | 90,422 | $ | 79,234 | ||||||||||||||||||||
Net interest-rate spread (FTE) | 3.37 | % | 3.22 | % | ||||||||||||||||||||
Net interest margin (FTE)(4) | 3.54 | % | 3.34 | % |
(1) | Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate. |
(2) | Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued and loans that are held for sale. |
(3) | Securities available for sale are shown at amortized cost. Pretax unrealized gains of $12.6 million in 2017 and $30.4 million in 2016 are included in other assets for purposes of this presentation. |
(4) | Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets. |
UNITED COMMUNITY BANKS, INC. | |||||||||||
Average Consolidated Balance Sheets and Net Interest Analysis | |||||||||||
For the Nine Months Ended September 30, | |||||||||||
2017 | 2016 | |||||||||||||||||||||||
Average | Avg. | Average | Avg. | |||||||||||||||||||||
(dollars in thousands, fully taxable equivalent (FTE)) | Balance | Interest | Rate | Balance | Interest | Rate | ||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loans, net of unearned income (FTE)(1)(2) | $ | 7,011,962 | $ | 227,853 | 4.34 | % | $ | 6,277,972 | $ | 196,956 | 4.19 | % | ||||||||||||
Taxable securities(3) | 2,731,081 | 52,058 | 2.54 | 2,665,272 | 47,590 | 2.38 | ||||||||||||||||||
Tax-exempt securities (FTE)(1)(3) | 68,005 | 2,139 | 4.19 | 26,415 | 735 | 3.71 | ||||||||||||||||||
Federal funds sold and other interest-earning assets | 157,582 | 2,290 | 1.94 | 150,146 | 2,719 | 2.41 | ||||||||||||||||||
Total interest-earning assets (FTE) | 9,968,630 | 284,340 | 3.81 | 9,119,805 | 248,000 | 3.63 | ||||||||||||||||||
Non-interest-earning assets: | ||||||||||||||||||||||||
Allowance for loan losses | (60,971 | ) | (66,142 | ) | ||||||||||||||||||||
Cash and due from banks | 102,529 | 93,802 | ||||||||||||||||||||||
Premises and equipment | 195,576 | 187,019 | ||||||||||||||||||||||
Other assets(3) | 582,194 | 574,870 | ||||||||||||||||||||||
Total assets | $ | 10,787,958 | $ | 9,909,354 | ||||||||||||||||||||
Liabilities and Shareholders' Equity: | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||||
NOW | $ | 1,907,889 | 1,932 | .14 | $ | 1,795,372 | 1,381 | .10 | ||||||||||||||||
Money market | 2,100,296 | 4,938 | .31 | 1,901,903 | 3,661 | .26 | ||||||||||||||||||
Savings | 576,927 | 89 | .02 | 505,337 | 102 | .03 | ||||||||||||||||||
Time | 1,292,521 | 3,499 | .36 | 1,280,503 | 2,325 | .24 | ||||||||||||||||||
Brokered time deposits | 106,753 | 758 | .95 | 194,199 | (273 | ) | (.19 | ) | ||||||||||||||||
Total interest-bearing deposits | 5,984,386 | 11,216 | .25 | 5,677,314 | 7,196 | .17 | ||||||||||||||||||
Federal funds purchased and other borrowings | 22,525 | 177 | 1.05 | 29,427 | 278 | 1.26 | ||||||||||||||||||
Federal Home Loan Bank advances | 616,388 | 4,603 | 1.00 | 506,524 | 2,731 | .72 | ||||||||||||||||||
Long-term debt | 168,271 | 8,490 | 6.75 | 168,955 | 8,178 | 6.47 | ||||||||||||||||||
Total borrowed funds | 807,184 | 13,270 | 2.20 | 704,906 | 11,187 | 2.12 | ||||||||||||||||||
Total interest-bearing liabilities | 6,791,570 | 24,486 | .48 | 6,382,220 | 18,383 | .38 | ||||||||||||||||||
Non-interest-bearing liabilities: | ||||||||||||||||||||||||
Non-interest-bearing deposits | 2,738,118 | 2,374,076 | ||||||||||||||||||||||
Other liabilities | 121,672 | 102,421 | ||||||||||||||||||||||
Total liabilities | 9,651,360 | 8,858,717 | ||||||||||||||||||||||
Shareholders' equity | 1,136,598 | 1,050,637 | ||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 10,787,958 | $ | 9,909,354 | ||||||||||||||||||||
Net interest revenue (FTE) | $ | 259,854 | $ | 229,617 | ||||||||||||||||||||
Net interest-rate spread (FTE) | 3.33 | % | 3.25 | % | ||||||||||||||||||||
Net interest margin (FTE)(4) | 3.49 | % | 3.36 | % |
(1) | Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate. |
(2) | Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued and loans that are held for sale. |
(3) | Securities available for sale are shown at amortized cost. Pretax unrealized gains of $4.67 million in 2017 and $15.1 million in 2016 are included in other assets for purposes of this presentation. |
(4) | Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets. |