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[LOGO] NEWS RELEASE
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SYNOVUS(R)
FINANCIAL CORP.
For Immediate Release
Contact: Patrick A. Reynolds
Director of Investor Relations
(706) 649-4973
Synovus Financial Corp.(R)Reports 16% Increase in Net Income for
First Nine Months of 2000
Fee Income and Core Loan Growth Continue to Drive Revenue Gains
Columbus, Ga., Oct. 19, 2000 -- Synovus Financial Corp. (NYSE:
"SNV"), the Columbus, Ga.-based multi-financial services company, today
announced net income was $64.7 million for the third quarter, up 12%,
and $187.9 million for the first nine months of 2000, up 16%, compared
to $58.0 million and $162.1 million, respectively, for the same periods
in 1999. Diluted earnings per share were $0.23 for the third quarter,
up 10% over last year's $0.21. For the first nine months of 2000,
diluted earnings per share were $0.66, an increase of 14% over $0.57
per share for the same period in 1999. Two major growth areas -- fee
income from Total System Services, Inc.(R) (TSYS(R)) (NYSE: "TSS"),
Synovus' 80.8% owned electronic transaction processing subsidiary; and
core commercial lending -- continue to be the primary contributors to
the excellent increases in revenues. Continuing a trend that began in
the last half of 1999, expense control management positively impacted
the growth in net income.
"We are very pleased to report excellent third quarter results
and record earnings for the first nine months of 2000," said James H.
Blanchard, Synovus Financial Corp. Chairman and Chief Executive
Officer. "TSYS grew net income by 33% over the first nine months of
1999, and signed agreements with The Royal Bank of Scotland Group Plc
to process its 7 million consumer and commercial accounts for a 10-year
period and Navy Federal Credit Union, the world's largest credit union,
to process its 645,000 consumer card accounts. Our outstanding loan
growth of 22%, over the same period last year, coupled with continued
strong credit quality, added substantially to our excellent results."
Blanchard continued, "Our vision is for Synovus to be the best
financial services company in the world. We believe that our current
strategies, team members, technological advantages, and our strong
balance sheet position us well for future earnings growth. We currently
expect to grow earnings per share during the next three years
(2001-2003) by 15-18% annually. We expect at least 15% growth in
earnings per share in 2001 and to be at the top of the 15-18% range by
2003. In estimating expected growth in earnings per share, we have
assumed, among other things, that:
. Core banking net income will increase between 11-12%
annually, with net interest margins remaining stable,
annual loan growth will be in the 10-11% range, and credit
quality trends will remain at current levels.
. Wealth management revenues (trust, brokerage, and
insurance) will increase between 25-30% annually with the
complete integration and sales efforts of traditional
bankers, trust, brokerage, insurance, and private banking
team members.
. TSYS will increase net income between 20-25% annually with
expansion of the core businesses both domestically and
internationally and additional product development and
sales of these products, such as stored value products and
e-commerce enabler systems.
Post Office Box 120 / Columbus, GA 31902
www.synovus.com
Synovus Financial Corp.(R)Net Income Up 16% in First Nine Months of 2000/p. 2
. Increases in banking operations expenses will not exceed 4%
annually over the next three years."
Return on assets for the third quarter 2000 was 1.87% and
return on equity was 19.54%, as compared to 1.98% and 19.65%,
respectively, for the third quarter 1999. For the first nine months,
return on assets was 1.90% and return on equity was 19.56% as compared
to 1.94% and 18.79%, respectively, in the same period last year. Total
assets ended the quarter at $14.1 billion, an increase of 18% from the
same period last year. Shareholders' equity at Sept. 30, 2000, was
$1.344 billion, which represented 9.53% of quarter-end assets.
Strong asset quality trends continued during the quarter.
Reflecting the continued strength of the Southeastern regional economy
and the emphasis on high credit quality and credit management, the
ratio of nonperforming assets to loans and other real estate was 0.53%
at the end of the quarter, which included a national syndicated credit
of $7 million that filed for bankruptcy in the third quarter. Without
this credit, the nonperforming asset ratio would have been 0.46%. The
loan loss reserve was 1.38% of loans, which provides coverage of 313%
of nonperforming loans. Net charge-offs for the third quarter were
0.24% of average loans, unchanged from 0.24% for the same period in
1999. Provision expense for loan losses was 31% above the first nine
months of 1999 levels, due to the very strong loan growth, and covered
net charge-offs by 1.98x for the first nine months of the year compared
to 1.47x in the same period last year.
Synovus banking operations' revenues increased 8% over the
third quarter 1999, while net income increased 12% over last year.
Return on assets for the third quarter 2000 was 1.43% and return on
equity was 19.19%, compared to 1.51% and 18.49%, respectively, in the
same period last year. Net interest income increased by 7% versus third
quarter 1999, due to net loan growth of 22% and a net interest margin
of 4.57% for the quarter. The interest margin has compressed during the
past year due to the exceptional loan growth in our banking franchise,
which has created the need for greater utilization of wholesale funding
for this growth. Banking operations' non-interest income grew 11%, with
increases in trust service fees of 10%, credit card fees of 24%,
brokerage revenues of 9%, mortgage banking of 16%, and service charges
of 9% over the third quarter 1999. G&A expenses for the third quarter
of 2000 were 4.7% over the same period last year. The efficiency ratio
for the third quarter 2000 was 54.7% versus 56.4% for the third quarter
1999.
TSYS reported net income of $19.1 million in the third quarter
2000, a 13% increase in net income over the same period last year. For
the first nine months of 2000, TSYS' net income was $64.1 million, up
32.6% from $48.3 million for the same period in 1999. With Total
System's contribution, Synovus' total non-interest income -- excluding
securities gains/losses -- was 59% of revenues for the third quarter
2000.
Synovus will host a conference call about the quarterly
earnings at 4:15 EDT, on October 19, 2000. The conference call can be
accessed at www.videonewswire.com/synovus/10192000. You will be
required to register prior to hearing the live web broadcast.
Synovus Financial Corp. is a multi-financial services company with
$14.1 billion in assets based in Columbus, Ga. Synovus operates 39
banks serving communities in Georgia, Alabama, Florida and South
Carolina; pointpathbank, (www.pointpathbank.com) the innovative
financial community for online consumers, including engaged and newly
wed couples; an 80.8-percent share of Total System Services, Inc.
(NYSE: "TSS") (www.totalsystem.com), one of the world's leading
providers of payment services; DotsConnect, a wholly owned TSYS
subsidiary that provides the e-payments link between buyers and sellers
on the Web (www.dotsconnect.com); Synovus Wealth Management, an
integrated marketing unit
Post Office Box 120 / Columbus, GA 31902
www.synovus.com
Synovus Financial Corp.(R) Net Income Up 16% in First Nine Months of 2000/p. 3
that provides securities, trust, insurance and private banking services; Synovus
Mortgage Corp., which offers mortgage services throughout the Southeast; and
Synovus Leasing Services, a commercial leasing company. Synovus is No. 5 on
FORTUNE magazine's list of "The 100 Best Companies To Work For In America" for
2000. See Synovus on the web at www.synovus.com.
This press release contains statements that constitute
"forward-looking statements" within the meaning of the Securities Act
of 1933 and the Securities Exchange Act of 1934 as amended by the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements include, among others, statements regarding Synovus'
expected growth in earnings per share, core banking net income, wealth
management revenues, TSYS net income and banking operations expense for
the years 2001 through 2003. Prospective investors are cautioned that
any such forward-looking statements are not guarantees of future
performance and involve risks and uncertainties, and that actual
results may differ materially from those contemplated by such
forward-looking statements. A number of important factors could cause
actual results to differ materially from those contemplated by the
forward-looking statements in this press release. Many of these factors
are beyond Synovus' ability to control or predict. These factors
include, but are not limited to, competitive pressures arising from
aggressive competition from other lenders; factors that affect the
delinquency rate on Synovus' loans and the rate at which Synovus' loans
are charged off; changes in the cost and availability of funding due to
changes in the deposit market and credit market, or the way in which
Synovus is perceived in such markets; changes in prevailing interest
rates; the timely development of competitive new products and services
and the acceptance of such by customers; the growth and profitability
of Synovus' non interest or fee income, including changes in income
derived from TSYS, being less than expected; Synovus' inability to
control expenses; a deterioration in credit quality or a reduced demand
for credit; and the effects of changes in government policy and
regulations, including restrictions and/or limitations arising from
banking laws, regulations and examinations. Additional factors that
could cause actual results to differ materially from those contemplated
in this press release can be found in Synovus' filings with the
Securities and Exchange Commission, including its Annual Report on Form
10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.
We believe these forward-looking statements are reasonable; however,
undue reliance should not be placed on any forward-looking statements,
which are based on current expectations.
Post Office Box 120 / Columbus, GA 31902
www.synovus.com
Synovus Financial Corp.
INCOME STATEMENT Nine Months Ended
(Amounts in thousands, except per share data) September 30,
---------------------------------------
2000 1999 Change
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Interest Income (Taxable equivalent) ........ $ 807,325 651,712 23.9 %
Interest Expense ............................ 384,043 270,378 42.0
-------- -------- ------
Net Interest Income (Taxable equivalent)..... 423,282 381,334 11.0
Tax equivalent adjustment.................... 4,492 4,336 3.6
-------- -------- ------
Net Interest Income ......................... 418,790 376,998 11.1
Provision for Loan Losses ................... 33,245 25,343 31.2
-------- -------- ------
Net Interest Income After Provision ......... 385,545 351,655 9.6
-------- -------- ------
Non-Interest Income:
Fees For Trust Services ................. 16,555 15,046 10.0
Service Charges ......................... 62,219 57,465 8.3
Data Processing ......................... 414,905 357,448 16.1
Mortgage Banking Income.................. 15,595 16,269 (4.1)
Credit Card Fees......................... 13,158 10,672 23.3
Brokerage Revenue........................ 11,821 10,591 11.6
Securities Gains (Losses)................ 70 874 (92.0)
Other Non-Interest Income................ 76,155 66,940 13.8
-------- -------- ------
Total Non-Interest Income ................... 610,478 535,305 14.0
-------- -------- ------
Non-Interest Expense:
Personnel Expense ........................ 373,819 333,628 12.0
Occupancy & Equipment Expense............. 164,730 151,556 8.7
Other Non-Interest Expense................ 150,524 142,128 5.9
-------- -------- ------
Total Non-Interest Expense .................. 689,073 627,312 9.8
-------- -------- ------
Minority Interest in Consolidated
Subsidiaries.............................. 12,317 9,289 32.6
Income Before Taxes ......................... 294,633 250,359 17.7
Income Tax Expense .......................... 106,758 88,308 20.9
-------- -------- ------
Net Income .................................. 187,875 162,051 15.9
======== ======== ======
Basic Earnings per Share .................... 0.66 0.58 14.4
Diluted Earnings per Share................... 0.66 0.57 14.5
Dividends Declared per Share ................ 0.33 0.27 22.2
Return on Assets ............................ 1.90 1.94 (4)bp
Return on Equity ............................ 19.56 18.79 77
Average Shares Outstanding - Basic........... 283,260 279,381 1.4 %
Average Shares Outstanding - Diluted......... 286,319 282,670 1.3
bp - change is measured as difference in basis points.
Synovus Financial Corp.
INCOME STATEMENT 2000 1999 3rd Quarter
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(Amounts in thousands, Third Second First Fourth Third '00 vs. '99
except per share data) Quarter Quarter Quarter Quarter Quarter Change
------------------------------------------------------------------------- ------------
Interest Income (Taxable equivalent) ..... $285,035 270,531 251,759 241,604 227,094 25.5 %
Interest Expense ......................... 143,323 127,420 113,300 104,335 95,009 50.9
------- ------- ------- -------- ------- ------
Net Interest Income (Taxable equivalent).. 141,712 143,111 138,459 137,269 132,085 7.3
Tax equivalent adjustment................. 1,471 1,531 1,490 973 1,451 1.4
------- ------- ------- -------- ------- ------
Net Interest Income ...................... 140,241 141,580 136,969 136,296 130,634 7.4
Provision for Loan Losses ................ 9,622 12,712 10,911 8,664 8,613 11.7
------- ------- ------- -------- ------- ------
Net Interest Income After Provision ...... 130,619 128,868 126,058 127,632 122,021 7.0
------- ------- ------- -------- ------- ------
Non-Interest Income:
Fees For Trust Services .............. 5,546 5,250 5,759 4,985 5,041 10.0
Service Charges ...................... 21,679 20,617 19,923 20,663 19,938 8.7
Data Processing ...................... 141,100 139,860 133,945 132,706 126,589 11.5
Mortgage Banking Income............... 5,887 5,562 4,146 4,927 5,063 16.3
Credit Card Fees...................... 4,878 4,362 3,918 4,451 3,948 23.6
Brokerage Revenue..................... 3,441 3,883 4,497 3,486 3,145 9.4
Securities Gains (Losses)............. 98 (27) (1) 328 159 (38.4)
Other Non-Interest Income............. 21,670 26,056 28,429 32,914 23,056 (6.0)
------- ------- ------- -------- ------- ------
Total Non-Interest Income ................ 204,299 205,563 200,616 204,460 186,939 9.3
------- ------- ------- -------- ------- ------
Non-Interest Expense:
Personnel Expense ..................... 125,117 124,817 123,885 124,113 113,359 10.4
Occupancy & Equipment Expense.......... 54,394 56,537 53,799 56,641 53,991 0.7
Other Non-Interest Expense............. 50,248 51,084 49,192 48,483 48,466 3.7
------- ------- ------- -------- ------- ------
Total Non-Interest Expense ............... 229,759 232,438 226,876 229,237 215,816 6.5
------- ------- ------- -------- ------- ------
Minority Interest in Consolidated
Subsidiaries........................... 3,692 4,664 3,961 3,899 3,257 13.4
Income Before Taxes ...................... 101,467 97,329 95,837 98,956 89,887 12.9
Income Tax Expense ....................... 36,736 35,577 34,445 35,700 31,882 15.2
------- ------- ------- -------- ------- ------
Net Income ............................... 64,731 61,752 61,392 63,256 58,005 11.6
======= ======= ======= ======== ======= ======
Basic Earnings per Share ................. 0.23 0.22 0.22 0.22 0.21 9.8
Diluted Earnings per Share................ 0.23 0.22 0.22 0.22 0.21 9.8
Dividends Declared per Share ............. 0.11 0.11 0.11 0.09 0.09 22.2
Return on Assets ......................... 1.87 % 1.88 % 1.95 % 2.06 % 1.98 (11)bp
Return on Equity ......................... 19.54 19.40 19.75 20.89 19.65 (11)
Average Shares Outstanding - Basic........ 284,149 283,457 282,163 281,901 279,694 1.6 %
Average Shares Outstanding - Diluted...... 287,392 286,605 284,951 285,392 282,806 1.6
bp - change is measured as difference in basis points.
Synovus Financial Corp.
SELECTED BALANCE SHEET DATA 2000 1999 3rd Quarter
------------------------------------------------------------------------ ------------
(Amounts in thousands, except Third Second First Fourth Third '00 vs. '99
per share data) Quarter Quarter Quarter Quarter Quarter Change
------------------------------------------------------------------------ ------------
Total Assets..............................$14,105,157 13,685,928 13,048,240 12,547,001 11,977,091 17.8 %
Investment Securities..................... 2,044,152 2,029,580 2,021,871 1,993,957 1,998,733 2.3
Loans (net of unearned income)............ 10,454,999 10,071,234 9,492,579 9,068,239 8,599,672 21.6
Total Deposits............................ 10,423,641 10,132,131 9,690,236 9,440,087 9,275,346 12.4
Demand Deposits....................... 1,592,184 1,678,714 1,637,516 1,625,313 1,550,820 2.7
Certificates of Deposit............... 4,980,595 4,685,702 4,333,998 4,239,144 4,111,241 21.1
Savings Accounts...................... 430,961 441,288 451,751 444,493 466,391 (7.6)
NOW Accounts.......................... 1,431,054 1,424,644 1,436,751 1,364,244 1,325,344 8.0
Money Market.......................... 1,988,847 1,901,783 1,830,220 1,766,893 1,821,550 9.2
Shareholders' Equity..................... 1,343,540 1,294,165 1,256,629 1,226,669 1,185,845 13.3
Book Value Per Share...................... 4.73 4.56 4.45 4.35 4.24 11.6
Equity to Assets.......................... 9.53 9.46 9.63 9.78 9.90 (37) bp
Loan to Deposit Ratio..................... 100.30 99.40 97.96 96.06 92.72 758
Demand Deposits / Total Deposits.......... 15.27 16.57 16.90 17.22 16.72 (145)
Common Shares Outstanding................. 284,179 284,086 282,282 282,014 279,727 1.6 %
CREDIT QUALITY DATA 2000 1999 3rd Quarter
------------------------------------------------------------------------ ------------
(Dollars in thousands) Third Second First Fourth Third '00 vs. '99
Quarter Quarter Quarter Quarter Quarter Change
------------------------------------------------------------------------ ------------
Nonperforming Loans...................... $ 45,974 39,632 34,170 27,924 26,628 72.7 %
Other Real Estate......................... 9,408 7,839 8,803 6,718 8,668 8.5
Nonperforming Assets..................... 55,382 47,471 42,973 34,642 35,296 56.9
Reserve for Loan Losses................... 143,974 140,539 134,035 127,558 122,560 17.5
Net Charge-Offs - Quarter................. 6,187 6,208 4,434 6,301 4,978 24.3
Net Charge-Offs - YTD..................... 16,829 10,642 4,434 23,486 17,185 (2.1)
Net Charge-Offs/Average Loans - Quarter... 0.24 0.25 0.19 0.29 0.24 - bp
Net Charge-Offs/Average Loans - YTD....... 0.23 0.22 0.19 0.29 0.29 (6)
Nonperforming Loans/Loans & ORE........... 0.44 0.39 0.36 0.31 0.31 13
Nonperforming Assets/Loans & ORE.......... 0.53 0.47 0.45 0.38 0.41 12
Loan Loss Reserve/Loans................... 1.38 1.40 1.41 1.41 1.43 (5)
Reserve/Nonperforming Loans............... 313.17 354.61 392.27 456.80 460.27 (14,710)
Reserve/Nonperforming Assets.............. 259.97 296.05 311.91 368.22 347.23 (8,726)
bp - change is measured as difference in basis points.
Synovus Financial Corp.
AVERAGE BALANCES AND YIELDS/RATES
(Amounts in thousands)
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2000 1999
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Third Second First Fourth Third
Interest Earning Assets Quarter Quarter Quarter Quarter Quarter
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Investment Securities......................... $ 2,076,443 2,079,584 2,057,892 2,030,615 2,002,149
Yield...................................... 6.39 % 6.33 6.32 6.29 6.23
Loans, Net.................................... $ 10,077,078 9,630,646 9,137,781 8,701,890 8,230,396
Yield...................................... 9.79 % 9.78 9.53 9.45 9.33
Mortgage Loans Held for Sale.................. $ 119,377 100,498 75,966 80,513 102,053
Yield...................................... 8.12 % 8.04 8.03 8.15 6.89
Federal Funds Sold............................ $ 88,095 75,888 82,544 89,768 38,394
Yield...................................... 6.89 % 6.42 5.90 5.53 5.01
Time Deposits with Banks...................... $ 2,437 1,004 1,475 1,835 1,766
Yield...................................... 9.80 % 8.85 6.64 5.94 4.58
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Total Interest Earning Assets $ 12,363,430 11,887,620 11,355,658 10,904,621 10,374,758
Yield 9.18 % 9.14 8.92 8.82 8.69
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Interest Bearing Liabilities
Time Deposits Over $100,000................... $ 2,409,826 2,052,892 1,804,601 1,736,249 1,621,882
Rate....................................... 6.47 % 6.08 5.70 5.50 5.34
Time Deposits Under $100,000.................. $ 2,498,105 2,462,291 2,455,510 2,446,971 2,414,831
Rate....................................... 5.92 % 5.60 5.33 5.20 5.11
Other Interest Bearing Deposits............... $ 3,767,410 3,716,475 3,652,493 3,625,893 3,693,419
Rate....................................... 3.82 % 3.60 3.36 3.23 3.17
Federal Funds Purchased....................... $ 1,188,934 1,311,583 1,297,801 1,071,473 741,094
Rate....................................... 6.42 % 6.18 5.69 5.29 4.94
Other Short-Term Borrowings................... $ 8,991 10,614 8,771 7,806 7,701
Rate....................................... 5.48 % 6.11 5.60 5.07 4.99
Other Borrowings.............................. $ 660,351 532,531 398,490 281,191 211,034
Rate....................................... 6.60 % 6.09 5.93 5.81 5.72
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Total Interest Bearing Liabilities $ 10,533,617 10,086,386 9,617,666 9,169,583 8,689,961
Rate 5.39 % 5.06 4.73 4.51 4.33
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Non-Interest Bearing Demand Deposits.......... $ 1,569,023 1,588,252 1,528,089 1,535,658 1,514,651
Shareholders' Equity.......................... $ 1,317,936 1,280,135 1,249,893 1,201,225 1,171,188
Total Assets.................................. $ 13,736,068 13,220,498 12,672,801 12,188,029 11,624,783
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Spread 3.79 % 4.08 4.19 4.31 4.35
Net Interest Margin 4.57 % 4.83 4.90 5.02 5.05
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