Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - Atlantic Union Bankshares Corp | v399646_8k.htm |
Exhibit 99.1
| Contact: | Robert M. Gorman - (804) 523-7828 |
| Executive Vice President / Chief Financial Officer |
UNION BANKSHARES REPORTS FOURTH QUARTER AND FULL YEAR RESULTS
Richmond, Va., January 28, 2015 - Union Bankshares Corporation (the “Company” or “Union”) (NASDAQ: UBSH) today reported net income of $15.1 million and earnings per share of $0.33 for its fourth quarter ended December 31, 2014. Excluding after-tax acquisition-related expenses of $563,000, operating earnings(1) for the quarter were $15.6 million and operating earnings per share(1) was $0.34. Net income for the year ended December 31, 2014 was $52.6 million and earnings per share was $1.14. For the year ended December 31, 2014, operating earnings were $66.3 million and operating earnings per share was $1.44.
“2014 was a year of significant progress and transformation for Union as a result of the StellarOne acquisition in January, which created the largest community bank headquartered in Virginia,” said G. William Beale, president and chief executive officer of Union Bankshares Corporation, “In 2014, the company was focused on smoothly integrating StellarOne into Union, achieving our cost savings targets and generating sustainable growth in the combined community banking franchise. I am pleased to note that our integration efforts have been successful as we delivered on each of the financial metrics we laid out when we announced the acquisition, experienced lower than projected customer attrition, and in the fourth quarter, generated the strong loan growth we expected as our lending team began to assert itself in our markets. Looking forward, we believe that work done this past year provides Union with the growth opportunities, asset base and footprint to continue to deliver a best-in-class customer experience, offer superior financial services and solutions, provide a rewarding experience for our teammates and generate top-tier financial performance for our shareholders.”
Select highlights for the fourth quarter include:
| · | Operating earnings(1) for the community bank segment, which excludes after-tax acquisition-related expenses of $563,000, were $16.5 million, or $0.36 per share, for the fourth quarter compared to $16.7 million, or $0.36 per share for the third quarter. For the year ended December 31, 2014, the community bank segment’s operating earnings were $69.8 million, or $1.52 per share. |
| · | The mortgage segment reported a net loss of $889,000, or $0.02 per share, for the fourth quarter compared to a net loss of $628,000, or $0.01 per share, for the third quarter. For the year ended December 31, 2014, the mortgage segment reported a net loss of $3.5 million, or $0.08 per share. |
| · | Operating Return on Average Tangible Common Equity(1) (“ROTCE”) was 9.51% and 10.19% for the quarter and year ended December 31, 2014, respectively. The operating ROTCE(1) of the community bank segment was 10.10% for the fourth quarter and 10.84% for the full year. |
| · | Operating Return on Average Assets(1) (“ROA”) was 0.86% and 0.91% for the quarter and year ended December 31, 2014, respectively. The operating ROA(1) of the community bank segment was 0.91% for the fourth quarter and 0.96% for the full year. |
| · | Operating efficiency ratio(1) improved to 64.8% for the current quarter from 69.8% in the prior quarter. The operating efficiency ratio for the community bank segment was 62.1% for the fourth quarter. |
| · | Loan growth was strong during the quarter. Ending loan balances increased $175.0 million, or 13.5% on an annualized basis, from September 30, 2014 and $68.4 million, or 1.3%, from December 31, 2013, on a pro forma basis (including StellarOne loans). Average loans outstanding increased $24.1 million from the prior quarter. |
| · | On January 31, 2014, the Company’s Board of Directors authorized a share repurchase program to purchase up to $65.0 million worth of the Company’s common stock on the open market or in privately negotiated transactions. The repurchase program is authorized through December 31, 2015. As of January 23, 2015, approximately 2.2 million common shares had been repurchased and approximately $10.0 million remained available under the repurchase program. |
(1)For a reconciliation of the non-GAAP measures operating earnings, earnings per share (“EPS”), ROTCE, ROA, and efficiency ratio, see “Alternative Performance Measures (non-GAAP)” section of the Key Financial Results.
NET INTEREST INCOME
Tax-equivalent net interest income was $65.1 million, a decrease of $1.5 million from the third quarter of 2014. The fourth quarter tax-equivalent net interest margin decreased 10 basis points to 4.01% from 4.11% in the previous quarter. Core tax-equivalent net interest margin (which excludes the 13 basis points impact of acquisition accounting accretion) decreased by 4 basis points from 3.92% in the previous quarter to 3.88%. The decrease in the core tax-equivalent net interest margin was principally due to a decrease in interest-earning asset yields (-5 basis points), outpacing the decline in cost of funds (+1 basis points). The decline in interest-earning asset yields was primarily driven by reinvestment of excess cash flows at lower rates during the quarter and lower loan yields, as new and renewed loans were originated and re-priced at lower rates.
The Company continues to believe that core net interest margin will decline modestly over the next several quarters as decreases in interest-earning asset yields are projected to outpace declines in interest-bearing liabilities rates.
The Company’s fully taxable equivalent net interest margin includes the impact of acquisition accounting fair value adjustments. The third and fourth quarters of 2014, full year 2014, and remaining estimated discount/premium and net accretion impact are reflected in the following table (dollars in thousands):
| Loan Accretion | Certificates of Deposit | Borrowings | Total | |||||||||||||
| For the quarter ended September 30, 2014 | $ | 846 | $ | 1,998 | $ | 262 | $ | 3,106 | ||||||||
| For the quarter ended December 31, 2014 | 504 | 1,536 | 137 | 2,177 | ||||||||||||
| For the years ending: | ||||||||||||||||
| 2014 | 586 | 8,914 | 550 | 10,050 | ||||||||||||
| 2015 | 2,430 | 1,843 | 175 | 4,448 | ||||||||||||
| 2016 | 2,951 | - | 271 | 3,222 | ||||||||||||
| 2017 | 3,143 | - | 170 | 3,313 | ||||||||||||
| 2018 | 2,731 | - | (143 | ) | 2,588 | |||||||||||
| 2019 | 2,128 | - | (286 | ) | 1,842 | |||||||||||
| Thereafter | 12,717 | - | (5,923 | ) | 6,794 | |||||||||||
ASSET QUALITY/LOAN LOSS PROVISION
Overview
During the fourth quarter, the Company experienced declines in both nonaccrual loan and other real estate owned (“OREO”) balances from the prior quarter. The decline in OREO balances was mostly attributable to sales of closed bank premises and foreclosed commercial real estate property during the quarter. The provision increased from the prior quarter due to increases in net charge-offs and loan growth. The allowance for loan losses to total loans ratio remained consistent with the prior quarter and was down from the prior year, while the allowance for loan losses to total loans, adjusted for acquisition accounting, ratio was down from both the prior quarter and the prior year. The magnitude of any change in the real estate market and its impact on the Company is still largely dependent upon continued recovery of residential housing and commercial real estate and the pace at which the local economies in the Company’s operating markets improve. All nonaccrual and past due loan metrics discussed below excludes purchased credit impaired loans (“PCI”) aggregating $105.8 million (net of fair value mark).
Nonperforming Assets (“NPAs”)
At December 31, 2014, nonperforming assets totaled $47.4 million, a decrease of $1.8 million, or 3.6%, from a year ago and a decline of $10.7 million, or 18.4%, from September 30, 2014. In addition, NPAs as a percentage of total outstanding loans declined 73 basis points from 1.62% a year earlier and 23 basis points from 1.12% last quarter to 0.89% in the current quarter. The following table shows a summary of asset quality balances at the quarter ended (dollars in thousands):
| December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
| 2014 | 2014 | 2014 | 2014 | 2013 | ||||||||||||||||
| Nonaccrual loans, excluding PCI loans | $ | 19,255 | $ | 20,279 | $ | 23,099 | $ | 14,722 | $ | 15,035 | ||||||||||
| Foreclosed properties | 23,058 | 28,783 | 33,739 | 35,487 | 34,116 | |||||||||||||||
| Real estate investment | 5,060 | 8,971 | 4,755 | - | - | |||||||||||||||
| Total nonperforming assets | 47,373 | 58,033 | 61,593 | 50,209 | 49,151 | |||||||||||||||
The following table shows the activity in nonaccrual loans for the quarter ended (dollars in thousands):
| December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
| 2014 | 2014 | 2014 | 2014 | 2013 | ||||||||||||||||
| Beginning Balance | $ | 20,279 | $ | 23,099 | $ | 14,722 | $ | 15,035 | $ | 19,941 | ||||||||||
| Net customer payments | (4,352 | ) | (1,654 | ) | (1,088 | ) | (959 | ) | (1,908 | ) | ||||||||||
| Additions | 7,413 | 1,099 | 11,087 | 1,362 | 3,077 | |||||||||||||||
| Charge-offs | (1,839 | ) | (604 | ) | (137 | ) | (152 | ) | (4,336 | ) | ||||||||||
| Loans returning to accruing status | (2,246 | ) | (723 | ) | (523 | ) | - | (1,018 | ) | |||||||||||
| Transfers to OREO | - | (938 | ) | (962 | ) | (564 | ) | (721 | ) | |||||||||||
| Ending Balance | $ | 19,255 | $ | 20,279 | $ | 23,099 | $ | 14,722 | $ | 15,035 | ||||||||||
The following table shows the activity in OREO for the quarter ended (dollars in thousands):
| December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
| 2014 | 2014 | 2014 | 2014 | 2013 | ||||||||||||||||
| Beginning Balance | $ | 37,754 | $ | 38,494 | $ | 35,487 | $ | 34,116 | $ | 35,709 | ||||||||||
| Additions of foreclosed property | 367 | 2,553 | 1,619 | 5,404 | 1,326 | |||||||||||||||
| Additions of former bank premises | 63 | 4,814 | 6,052 | - | - | |||||||||||||||
| Capitalized Improvements | 424 | 203 | 59 | - | 101 | |||||||||||||||
| Valuation Adjustments | (381 | ) | (6,192 | ) | (817 | ) | (256 | ) | (300 | ) | ||||||||||
| Proceeds from sales | (11,362 | ) | (2,216 | ) | (3,913 | ) | (3,800 | ) | (2,483 | ) | ||||||||||
| Gains (losses) from sales | 1,253 | 98 | 7 | 23 | (237 | ) | ||||||||||||||
| Ending Balance | $ | 28,118 | $ | 37,754 | $ | 38,494 | $ | 35,487 | $ | 34,116 | ||||||||||
During the fourth quarter of 2014, the majority of sales of OREO were related to closed bank premises and commercial real estate.
Past Due Loans
Past due loans totaled $48.1 million, or 0.90% of total loans, at December 31, 2014 compared to $26.5 million, or 0.87%, a year ago and $58.4 million, or 1.13%, at September 30, 2014. At December 31, 2014, loans past due 90 days or more and accruing interest totaled $10.0 million, or 0.19% of total loans, compared to $6.7 million, or 0.22%, a year ago and $16.1 million, or 0.31%, at September 30, 2014.
Charge-offs
For the quarter ended December 31, 2014, net charge-offs were $4.2 million, or 0.31% on an annualized basis, compared to $4.9 million, or 0.65%, for the same quarter last year and $1.1 million, or 0.08%, for the third quarter of 2014. Of the $4.2 million in loans charged off in the fourth quarter, $1.2 million, or 28.6%, related to impaired loans specifically reserved for in the prior period. For the year ended December 31, 2014, net charge-offs were $5.6 million, or 0.10% on an annualized basis, compared to $10.8 million, or 0.36%, for the prior year.
Provision
The provision for loan losses for the current quarter was $4.5 million, an increase of $3.3 million compared to the same quarter a year ago and an increase of $2.7 million from the previous quarter. The increase in provision for loan losses in the current quarter compared to the prior quarter was driven by increases in charge-offs and loan growth during the quarter.
Allowance for Loan Losses
The allowance for loan losses (“ALL”) increased $275,000 from September 30, 2014 to $32.4 million at December 31, 2014. The ALL as a percentage of the total loan portfolio, adjusted for purchase accounting (non-GAAP), was 1.08% at December 31, 2014, a decrease from 1.12% from the prior quarter and from 1.10% at December 31, 2013. The allowance for loan losses as a percentage of the total loan portfolio was 0.61% at December 31, 2014, 0.62% at September 30, 2014, and 0.99% at December 31, 2013. In acquisition accounting, there is no carryover of previously established allowance for loan losses.
The nonaccrual loan coverage ratio was 168.2% at December 31, 2014, compared to 158.3% at September 30, 2014 and 200.4% at December 31, 2013. The current level of the allowance for loan losses reflects specific reserves related to nonperforming loans, current risk ratings on loans, net charge-off activity, loan growth, delinquency trends, and other credit risk factors that the Company considers important in assessing the adequacy of the allowance for loan losses.
NONINTEREST INCOME
Noninterest income declined $1.4 million from $16.3 million in the prior quarter to $14.9 million. Gains on sales of securities decreased $749,000 from the prior quarter to $246,000. Gains on sales of mortgage loans, net of commissions, decreased $815,000, or 31.4%, from the prior quarter, driven by decreased mortgage loan originations. Mortgage loan originations declined by $22.8 million, or 12.8%, in the current quarter to $155.2 million from $178.0 million in the third quarter. Of the loan originations in the current quarter, 37.8% were refinances, which was an increase from 28.6% in the prior quarter. These decreases in noninterest income were partially offset by increased fiduciary and asset management fees of $162,000, primarily due to higher gross brokerage commissions.
NONINTEREST EXPENSE
Noninterest expense decreased $6.9 million, or 11.5%, to $52.6 million from $59.5 million when compared to the prior quarter. Excluding acquisition-related costs, which were $821,000 and $1.7 million in the current and previous quarters, respectively, noninterest expense decreased $6.0 million, or 10.4%, from the prior quarter to $51.8 million. The decrease in noninterest expense is primarily driven by a $6.6 million decrease in OREO and credit-related expenses related to lower valuation write-downs of $5.7 million and increased gains on sale of OREO of $1.2 million offset by slightly higher credit-related costs of $247,000. Additionally, marketing expense declined $479,000 from the prior quarter. Partially offsetting these declines, professional fees increased $298,000 and other expenses increased primarily due to fraud-related losses of $515,000. The Company’s operating efficiency ratio declined to 64.8% from 69.8% in the third quarter.
BALANCE SHEET
At December 31, 2014, total assets were $7.4 billion, an increase of $3.2 billion from December 31, 2013, reflecting the impact of the StellarOne acquisition, and an increase of $164.8 million, or 2.29%, from September 30, 2014.
At December 31, 2014, loans net of unearned income were $5.3 billion, an increase of $175.0 million, or 13.5% (annualized), from September 30, 2014, while average loans increased $24.1 million, or 1.9% (annualized). On a proforma basis, including StellarOne loan balances, period end loan balances increased $68.4 million, or 1.3%, when compared to December 31, 2013.
At December 31, 2014, total deposits were $5.6 billion, an increase of $4.7 million from September 30, 2014, while average deposits declined $39.7 million, or 2.8% (annualized). On a proforma basis, including StellarOne deposit balances, period end deposit balances declined $76.1 million, or 1.3%, when compared to December 31, 2013.
The Company’s capital ratios continued to be considered “well capitalized” for regulatory purposes. The Company’s estimated ratios of total capital to risk-weighted assets and Tier 1 capital to risk-weighted assets as of December 31, 2014 were 13.39% and 12.77%, respectively. As of December 31, 2013, the Company’s ratio of total capital to risk-weighted assets and Tier 1 capital to risk-weighted assets were 14.17% and 13.05%, respectively, and were 13.71% and 13.07%, respectively, as of September 30, 2014. The Company’s common equity to asset ratios at December 31, 2014, September 30, 2014 and December 31, 2013 were 13.29%, 13.59%, and 10.49%, respectively, while its tangible common equity to tangible assets ratio was 9.28%, 9.42%, and 8.94% at December 31, 2014, September 30, 2014, and December 31, 2013, respectively.
COMMUNITY BANK SEGMENT INFORMATION
The community bank segment reported net income of $16.0 million for the fourth quarter, an increase of $409,000, or 2.6%, from $15.6 million in the third quarter. Excluding after-tax acquisition-related expenses of $563,000 million and $1.1 million in the current and prior quarters, respectively, operating earnings decreased $130,000 from the prior quarter to $16.5 million. As previously discussed, the provision for loan losses increased $2.7 million from the prior quarter due to increased charge-off levels and loan growth during the quarter. Net interest income was $62.9 million, a decrease of $1.3 million from the third quarter due primarily to lower acquisition-related accretion income.
Noninterest income decreased $972,000 from $13.9 million in the prior quarter to $12.9 million. The primary driver of the decrease in noninterest income was the $749,000 decline in gains on sales of securities from $995,000 in the prior quarter to $246,000 in the current quarter. In addition, interest received on previously charged off loans declined $215,000 from the prior quarter.
Noninterest expense decreased $6.7 million from $55.8 million to $49.1 million. Excluding acquisition-related costs, which were $821,000 and $1.7 million in the current quarter and previous quarter, respectively, noninterest expense decreased $5.8 million, or 10.7%, compared to the prior quarter. The decrease in noninterest expense is primarily driven by a $6.6 million decrease in OREO and credit-related expenses related to lower valuation write-downs of $5.7 million and increased gains on sale of OREO of $1.2 million offset by slightly higher credit-related costs of $247,000. Additionally, marketing expense decreased $467,000 from the prior quarter. Partially offsetting these declines, professional fees increased $329,000 and other expenses increased primarily due to fraud-related losses of $515,000. The community banking segment’s operating efficiency ratio decreased to 62.1% in the fourth quarter from 67.5% in the prior quarter.
MORTGAGE SEGMENT INFORMATION
The mortgage segment reported a net loss of $889,000 for the fourth quarter, an increased loss of $261,000 from a net loss of $628,000 in the third quarter. Noninterest income declined $462,000 during the quarter due to lower gains on sales of mortgage loans, net of commissions, partially offset by nonrecurring income of $334,000. Gains on sales of mortgage loans, net of commissions, decreased $815,000, primarily related to lower mortgage loan originations. Mortgage loan originations decreased by $22.8 million, or 12.8%, in the current quarter to $155.2 million from $178.0 million in the third quarter. Of the loan originations in the current quarter, 37.8% were refinances, which was an increase from 28.6% in the prior quarter. Noninterest expenses decreased $224,000, or 5.8%, from $3.9 million in the prior quarter to $3.7 million, primarily related to declines in salaries and occupancy expense. Included in noninterest expense is approximately $250,000 of nonrecurring costs incurred in the fourth quarter related to severance and lease terminations, as a result of management’s continued efforts to streamline the mortgage segment’s processes and cost structure to align with the overall lower mortgage origination levels it has been experiencing over the last several quarters.
* * * * * * *
ABOUT UNION BANKSHARES CORPORATION
Headquartered in Richmond, Virginia, Union Bankshares Corporation (NASDAQ: UBSH) is the holding company for Union First Market Bank, which has 131 banking offices and more than 200 ATMs located throughout Virginia. Non-bank affiliates of the holding company include: Union Investment Services, Inc., which provides full brokerage services; Union Mortgage Group, Inc., which provides a full line of mortgage products; and Union Insurance Group, LLC, which offers various lines of insurance products.
Additional information on the Company is available at http://investors.bankatunion.com
Union Bankshares Corporation will hold a conference call on Wednesday, January 28th, at 9:00 a.m. Eastern Time during which management will review earnings and performance trends. Callers wishing to participate may call toll-free by dialing (877) 668-4908. The conference ID number is 66429855.
NON-GAAP MEASURES
In reporting the results of the quarter and year ended December 31, 2014, the Company has provided supplemental performance measures on an operating or tangible basis. Operating measures exclude acquisition costs unrelated to the Company’s normal operations. The Company believes these measures are useful to investors as they exclude non-operating adjustments resulting from acquisition activity and allow investors to see the combined economic results of the organization. Tangible common equity is used in the calculation of certain capital and per share ratios. The Company believes tangible common equity and the related ratios are meaningful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which the Company believes will assist investors in assessing the capital of the Company and its ability to absorb potential losses.
These measures are a supplement to GAAP used to prepare the Company’s financial statements and should not be viewed as a substitute for GAAP measures. In addition, the Company’s non-GAAP measures may not be comparable to non-GAAP measures of other companies.
FORWARD-LOOKING STATEMENTS
Certain statements in this report may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include projections, predictions, expectations, or beliefs about future events or results or otherwise are not statements of historical fact. Such statements are often characterized by the use of qualified words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” or words of similar meaning or other statements concerning opinions or judgment of the Company and its management about future events. Although the Company believes that its expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual results, performance, or achievements of the Company will not differ materially from any future results, performance, or achievements expressed or implied by such forward-looking statements. Actual future results and trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to, the effects of and changes in: general economic and bank industry conditions, the interest rate environment, legislative and regulatory requirements, competitive pressures, new products and delivery systems, inflation, the stock and bond markets, accounting standards or interpretations of existing standards, technology, consumer spending and savings habits, and mergers and acquisitions, including integration risk in connection with the Company’s acquisition of StellarOne such as potential deposit attrition, higher than expected costs, customer loss and business disruption, including, without limitation, potential difficulties in maintaining relationships with key personnel, and other integration related-matters. More information is available on the Company’s website, http://investors.bankatunion.com. The information on the Company’s website is not a part of this press release. The Company does not intend or assume any obligation to update or revise any forward-looking statements that may be made from time to time by or on behalf of the Company.
| UNION BANKSHARES CORPORATION AND SUBSIDIARIES |
| KEY FINANCIAL RESULTS |
| (Dollars in thousands, except share data) |
| Three Months Ended | Year Ended | |||||||||||||||||||
| 12/31/14 | 09/30/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||
| Results of Operations | ||||||||||||||||||||
| Interest and dividend income | $ | 68,511 | $ | 69,591 | $ | 43,315 | $ | 274,945 | $ | 172,127 | ||||||||||
| Interest expense | 5,446 | 5,112 | 4,702 | 19,927 | 20,501 | |||||||||||||||
| Net interest income | 63,065 | 64,479 | 38,613 | 255,018 | 151,626 | |||||||||||||||
| Provision for loan losses | 4,500 | 1,800 | 1,206 | 7,800 | 6,056 | |||||||||||||||
| Net interest income after provision for loan losses | 58,565 | 62,679 | 37,407 | 247,218 | 145,570 | |||||||||||||||
| Noninterest income | 14,901 | 16,318 | 8,379 | 61,287 | 38,728 | |||||||||||||||
| Noninterest expenses | 52,634 | 59,497 | 35,375 | 238,552 | 137,289 | |||||||||||||||
| Income before income taxes | 20,832 | 19,500 | 10,411 | 69,953 | 47,009 | |||||||||||||||
| Income tax expense | 5,760 | 4,576 | 2,306 | 17,362 | 12,513 | |||||||||||||||
| Net income | $ | 15,072 | $ | 14,924 | $ | 8,105 | $ | 52,591 | $ | 34,496 | ||||||||||
| Interest earned on earning assets (FTE) | $ | 70,516 | $ | 71,649 | $ | 44,702 | $ | 283,072 | $ | 177,383 | ||||||||||
| Net interest income (FTE) | 65,070 | 66,537 | 40,000 | 263,145 | 156,882 | |||||||||||||||
| Core deposit intangible amortization | 2,334 | 2,391 | 919 | 9,795 | 3,797 | |||||||||||||||
| Net income - community bank segment | $ | 15,961 | $ | 15,552 | $ | 10,002 | $ | 56,089 | $ | 37,155 | ||||||||||
| Net income (loss) - mortgage segment | (889 | ) | (628 | ) | (1,897 | ) | (3,498 | ) | (2,659 | ) | ||||||||||
| Key Ratios | ||||||||||||||||||||
| Earnings per common share, diluted | $ | 0.33 | $ | 0.33 | $ | 0.32 | $ | 1.14 | $ | 1.38 | ||||||||||
| Return on average assets (ROA) | 0.83 | % | 0.82 | % | 0.79 | % | 0.73 | % | 0.85 | % | ||||||||||
| Return on average equity (ROE) | 6.09 | % | 6.04 | % | 7.30 | % | 5.34 | % | 7.91 | % | ||||||||||
| Return on average tangible common equity (ROTCE) | 9.17 | % | 9.14 | % | 8.73 | % | 8.08 | % | 9.51 | % | ||||||||||
| Efficiency ratio (FTE) | 65.82 | % | 71.81 | % | 73.12 | % | 73.53 | % | 70.19 | % | ||||||||||
| Efficiency ratio - community bank segment (FTE) | 63.16 | % | 69.61 | % | 66.02 | % | 70.92 | % | 65.81 | % | ||||||||||
| Efficiency ratio - mortgage bank segment (FTE) | 155.98 | % | 133.59 | % | 288.43 | % | 148.71 | % | 130.58 | % | ||||||||||
| Net interest margin (FTE) | 4.01 | % | 4.11 | % | 4.27 | % | 4.09 | % | 4.22 | % | ||||||||||
| Net interest margin, core (FTE) (1) | 3.88 | % | 3.92 | % | 4.24 | % | 3.93 | % | 4.18 | % | ||||||||||
| Yields on earning assets (FTE) | 4.35 | % | 4.43 | % | 4.77 | % | 4.40 | % | 4.77 | % | ||||||||||
| Cost of interest-bearing liabilities (FTE) | 0.43 | % | 0.40 | % | 0.64 | % | 0.39 | % | 0.70 | % | ||||||||||
| Cost of funds | 0.34 | % | 0.32 | % | 0.50 | % | 0.31 | % | 0.55 | % | ||||||||||
| Key Operating Ratios - excluding merger costs (non-GAAP) (3) | ||||||||||||||||||||
| Consolidated | ||||||||||||||||||||
| Operating net income | $ | 15,635 | $ | 16,026 | $ | 8,756 | $ | 66,315 | $ | 36,538 | ||||||||||
| Operating diluted earnings per share | $ | 0.34 | $ | 0.35 | $ | 0.35 | $ | 1.44 | $ | 1.46 | ||||||||||
| Operating return on average assets | 0.86 | % | 0.88 | % | 0.85 | % | 0.91 | % | 0.90 | % | ||||||||||
| Operating return on average equity | 6.32 | % | 6.49 | % | 7.89 | % | 6.74 | % | 8.38 | % | ||||||||||
| Operating return on average tangible common equity | 9.51 | % | 9.82 | % | 9.43 | % | 10.19 | % | 10.07 | % | ||||||||||
| Operating efficiency ratio (FTE) | 64.79 | % | 69.76 | % | 71.59 | % | 67.26 | % | 69.10 | % | ||||||||||
| Community Bank Segment | ||||||||||||||||||||
| Operating net income | $ | 16,524 | $ | 16,654 | $ | 10,653 | $ | 69,813 | $ | 39,197 | ||||||||||
| Operating diluted earnings per share | $ | 0.36 | $ | 0.36 | $ | 0.43 | $ | 1.52 | $ | 1.57 | ||||||||||
| Operating return on average assets | 0.91 | % | 0.91 | % | 1.04 | % | 0.96 | % | 0.97 | % | ||||||||||
| Operating return on average equity | 6.70 | % | 6.77 | % | 9.79 | % | 7.14 | % | 9.18 | % | ||||||||||
| Operating return on average tangible common equity | 10.10 | % | 10.26 | % | 11.74 | % | 10.84 | % | 11.08 | % | ||||||||||
| Operating efficiency ratio (FTE) | 62.10 | % | 67.50 | % | 64.45 | % | 64.44 | % | 64.65 | % | ||||||||||
| Three Months Ended | Year Ended | |||||||||||||||||||
| 12/31/14 | 09/30/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||
| Capital Ratios | ||||||||||||||||||||
| Tier 1 risk-based capital ratio (5) | 12.77 | % | 13.07 | % | 13.05 | % | 12.77 | % | 13.05 | % | ||||||||||
| Total risk-based capital ratio (5) | 13.39 | % | 13.71 | % | 14.17 | % | 13.39 | % | 14.17 | % | ||||||||||
| Leverage ratio (Tier 1 capital to average assets) (5) | 10.64 | % | 10.55 | % | 10.70 | % | 10.64 | % | 10.70 | % | ||||||||||
| Common equity to total assets | 13.29 | % | 13.59 | % | 10.49 | % | 13.29 | % | 10.49 | % | ||||||||||
| Tangible common equity to tangible assets | 9.28 | % | 9.42 | % | 8.94 | % | 9.28 | % | 8.94 | % | ||||||||||
| Financial Condition | ||||||||||||||||||||
| Assets | $ | 7,359,171 | $ | 7,194,334 | $ | 4,176,571 | $ | 7,359,171 | $ | 4,176,571 | ||||||||||
| Loans, net of unearned income | 5,345,996 | 5,171,003 | 3,039,368 | 5,345,996 | 3,039,368 | |||||||||||||||
| Earning Assets | 6,566,504 | 6,382,463 | 3,802,870 | 6,566,504 | 3,802,870 | |||||||||||||||
| Goodwill | 293,522 | 296,876 | 59,400 | 293,522 | 59,400 | |||||||||||||||
| Core deposit intangibles, net | 31,755 | 34,089 | 11,980 | 31,755 | 11,980 | |||||||||||||||
| Deposits | 5,638,770 | 5,634,050 | 3,236,842 | 5,638,770 | 3,236,842 | |||||||||||||||
| Stockholders' equity | 978,025 | 977,673 | 438,239 | 978,025 | 438,239 | |||||||||||||||
| Tangible common equity | 652,748 | 646,708 | 366,859 | 652,748 | 366,859 | |||||||||||||||
| Loans, net of unearned income | ||||||||||||||||||||
| Raw land and lots | $ | 211,225 | $ | 210,557 | $ | 187,529 | $ | 211,225 | $ | 187,529 | ||||||||||
| Commercial construction | 341,280 | 303,576 | 213,675 | 341,280 | 213,675 | |||||||||||||||
| Commercial real estate | 2,384,602 | 2,279,708 | 1,256,669 | 2,384,602 | 1,256,669 | |||||||||||||||
| Single family investment real estate | 412,494 | 407,972 | 237,640 | 412,494 | 237,640 | |||||||||||||||
| Commercial and industrial | 393,776 | 380,613 | 215,702 | 393,776 | 215,702 | |||||||||||||||
| Other commercial | 81,106 | 79,356 | 52,490 | 81,106 | 52,490 | |||||||||||||||
| Consumer | 1,521,513 | 1,509,221 | 875,663 | 1,521,513 | 875,663 | |||||||||||||||
| Total loans, net of unearned income | $ | 5,345,996 | $ | 5,171,003 | $ | 3,039,368 | $ | 5,345,996 | $ | 3,039,368 | ||||||||||
| Interest-Bearing Deposits | ||||||||||||||||||||
| NOW accounts | $ | 1,332,029 | $ | 1,260,267 | $ | 498,068 | $ | 1,332,029 | $ | 498,068 | ||||||||||
| Money market accounts | 1,261,520 | 1,276,560 | 940,215 | 1,261,520 | 940,215 | |||||||||||||||
| Savings accounts | 548,526 | 552,309 | 235,034 | 548,526 | 235,034 | |||||||||||||||
| Time deposits of $100,000 and over | 550,842 | 565,934 | 427,597 | 550,842 | 427,597 | |||||||||||||||
| Other time deposits | 746,475 | 774,637 | 444,254 | 746,475 | 444,254 | |||||||||||||||
| Total interest-bearing deposits | $ | 4,439,392 | $ | 4,429,707 | $ | 2,545,168 | $ | 4,439,392 | $ | 2,545,168 | ||||||||||
| Demand deposits | 1,199,378 | 1,204,343 | 691,674 | 1,199,378 | 691,674 | |||||||||||||||
| Total deposits | $ | 5,638,770 | $ | 5,634,050 | $ | 3,236,842 | $ | 5,638,770 | $ | 3,236,842 | ||||||||||
| Averages | ||||||||||||||||||||
| Assets | $ | 7,238,020 | $ | 7,241,824 | $ | 4,075,443 | $ | 7,251,022 | $ | 4,052,068 | ||||||||||
| Loans, net of unearned income | 5,220,223 | 5,196,116 | 3,004,186 | 5,235,471 | 2,985,733 | |||||||||||||||
| Loans held for sale | 34,740 | 50,393 | 50,819 | 46,917 | 105,450 | |||||||||||||||
| Securities | 1,145,458 | 1,143,303 | 650,351 | 1,125,002 | 614,858 | |||||||||||||||
| Earning assets | 6,433,992 | 6,423,743 | 3,715,003 | 6,437,681 | 3,716,849 | |||||||||||||||
| Deposits | 5,660,824 | 5,701,752 | 3,232,688 | 5,675,521 | 3,255,626 | |||||||||||||||
| Certificates of deposit | 1,318,005 | 1,370,299 | 892,164 | 1,390,308 | 961,359 | |||||||||||||||
| Interest-bearing deposits | 4,437,178 | 4,507,247 | 2,536,769 | 4,511,489 | 2,591,423 | |||||||||||||||
| Borrowings | 536,639 | 507,882 | 363,889 | 536,061 | 322,716 | |||||||||||||||
| Interest-bearing liabilities | 4,973,817 | 5,015,129 | 2,900,658 | 5,047,550 | 2,914,139 | |||||||||||||||
| Stockholders' equity | 982,147 | 979,659 | 440,344 | 984,582 | 436,064 | |||||||||||||||
| Tangible common equity | 652,417 | 647,473 | 368,523 | 651,087 | 362,859 | |||||||||||||||
| Three Months Ended | Year Ended | |||||||||||||||||||
| 12/31/14 | 09/30/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||
| Asset Quality | ||||||||||||||||||||
| Allowance for Loan Losses (ALL) | ||||||||||||||||||||
| Beginning balance | $ | 32,109 | $ | 31,379 | $ | 33,877 | $ | 30,135 | $ | 34,916 | ||||||||||
| Add: Recoveries | 603 | 695 | 889 | 3,469 | 2,781 | |||||||||||||||
| Less: Charge-offs | 4,828 | 1,765 | 5,837 | 9,020 | 13,618 | |||||||||||||||
| Add: Provision for loan losses | 4,500 | 1,800 | 1,206 | 7,800 | 6,056 | |||||||||||||||
| Ending balance | $ | 32,384 | $ | 32,109 | $ | 30,135 | $ | 32,384 | $ | 30,135 | ||||||||||
| ALL / total outstanding loans | 0.61 | % | 0.62 | % | 0.99 | % | 0.61 | % | 0.99 | % | ||||||||||
| ALL / total outstanding loans, adjusted for acquisition accounting (2) | 1.08 | % | 1.12 | % | 1.10 | % | 1.08 | % | 1.10 | % | ||||||||||
| Net charge-offs / total outstanding loans | 0.31 | % | 0.08 | % | 0.65 | % | 0.10 | % | 0.36 | % | ||||||||||
| Provision / total outstanding loans | 0.33 | % | 0.14 | % | 0.16 | % | 0.15 | % | 0.20 | % | ||||||||||
| Nonperforming Assets | ||||||||||||||||||||
| Commercial | $ | 15,719 | $ | 14,836 | $ | 12,031 | $ | 15,719 | $ | 12,031 | ||||||||||
| Consumer | 3,536 | 5,443 | 3,004 | 3,536 | 3,004 | |||||||||||||||
| Nonaccrual loans | 19,255 | 20,279 | 15,035 | 19,255 | 15,035 | |||||||||||||||
| Other real estate owned | 28,118 | 37,754 | 34,116 | 28,118 | 34,116 | |||||||||||||||
| Total nonperforming assets (NPAs) | 47,373 | 58,033 | 49,151 | 47,373 | 49,151 | |||||||||||||||
| Commercial | 3,251 | 9,096 | 3,087 | 3,251 | 3,087 | |||||||||||||||
| Consumer | 6,796 | 7,022 | 3,659 | 6,796 | 3,659 | |||||||||||||||
| Loans ≥ 90 days and still accruing | 10,047 | 16,118 | 6,746 | 10,047 | 6,746 | |||||||||||||||
| Total nonperforming assets and loans ≥ 90 days | $ | 57,420 | $ | 74,151 | $ | 55,897 | $ | 57,420 | $ | 55,897 | ||||||||||
| NPAs / total outstanding loans | 0.89 | % | 1.12 | % | 1.62 | % | 0.89 | % | 1.62 | % | ||||||||||
| NPAs / total assets | 0.64 | % | 0.81 | % | 1.18 | % | 0.64 | % | 1.18 | % | ||||||||||
| ALL / nonperforming loans | 168.19 | % | 158.33 | % | 200.43 | % | 168.19 | % | 200.43 | % | ||||||||||
| ALL / nonperforming assets | 68.36 | % | 55.33 | % | 61.31 | % | 68.36 | % | 61.31 | % | ||||||||||
| Past Due Detail | ||||||||||||||||||||
| Commercial | $ | 2,692 | $ | 2,554 | $ | 1,017 | $ | 2,692 | $ | 1,017 | ||||||||||
| Consumer | 6,038 | 6,726 | 2,330 | 6,038 | 2,330 | |||||||||||||||
| Loans 60-89 days past due | $ | 8,730 | $ | 9,280 | $ | 3,347 | $ | 8,730 | $ | 3,347 | ||||||||||
| Commercial | $ | 9,682 | $ | 8,580 | $ | 3,839 | $ | 9,682 | $ | 3,839 | ||||||||||
| Consumer | 19,615 | 24,430 | 12,592 | 19,615 | 12,592 | |||||||||||||||
| Loans 30-59 days past due | $ | 29,297 | $ | 33,010 | $ | 16,431 | $ | 29,297 | $ | 16,431 | ||||||||||
| Commercial | $ | 94,235 | $ | 106,021 | $ | 2,732 | $ | 94,235 | $ | 2,732 | ||||||||||
| Consumer | 11,553 | 13,722 | 890 | 11,553 | 890 | |||||||||||||||
| Purchased impaired | $ | 105,788 | $ | 119,743 | $ | 3,622 | $ | 105,788 | $ | 3,622 | ||||||||||
| Troubled Debt Restructurings | ||||||||||||||||||||
| Performing | $ | 22,829 | $ | 26,243 | $ | 34,520 | $ | 22,829 | $ | 34,520 | ||||||||||
| Nonperforming | 3,948 | 2,728 | 7,304 | 3,948 | 7,304 | |||||||||||||||
| Total troubled debt restructurings | $ | 26,777 | $ | 28,971 | $ | 41,824 | $ | 26,777 | $ | 41,824 | ||||||||||
| Per Share Data | ||||||||||||||||||||
| Earnings per common share, basic | $ | 0.33 | $ | 0.33 | $ | 0.32 | $ | 1.14 | $ | 1.38 | ||||||||||
| Earnings per common share, diluted | 0.33 | 0.33 | 0.32 | 1.14 | 1.38 | |||||||||||||||
| Cash dividends paid per common share | 0.15 | 0.15 | 0.14 | 0.58 | 0.54 | |||||||||||||||
| Market value per share | 24.08 | 23.10 | 24.81 | 24.08 | 24.81 | |||||||||||||||
| Book value per common share | 21.75 | 21.58 | 17.56 | 21.75 | 17.56 | |||||||||||||||
| Tangible book value per common share | 14.40 | 14.27 | 14.69 | 14.40 | 14.69 | |||||||||||||||
| Price to earnings ratio, diluted | 18.39 | 17.64 | 19.54 | 21.12 | 17.98 | |||||||||||||||
| Price to book value per common share ratio | 1.11 | 1.07 | 1.41 | 1.11 | 1.41 | |||||||||||||||
| Price to tangible common share ratio | 1.67 | 1.62 | 1.69 | 1.67 | 1.69 | |||||||||||||||
| Weighted average common shares outstanding, basic | 45,341,854 | 45,649,309 | 24,939,360 | 46,036,023 | 24,975,077 | |||||||||||||||
| Weighted average common shares outstanding, diluted | 45,426,861 | 45,738,554 | 25,028,760 | 46,130,895 | 25,030,711 | |||||||||||||||
| Common shares outstanding at end of period | 45,162,853 | 45,514,028 | 24,976,434 | 45,162,853 | 24,976,434 | |||||||||||||||
| Three Months Ended | Year Ended | |||||||||||||||||||
| 12/31/14 | 09/30/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||
| Alternative Performance Measures (non-GAAP) | ||||||||||||||||||||
| Operating Earnings (3) | ||||||||||||||||||||
| Net Income (GAAP) | $ | 15,072 | $ | 14,924 | $ | 8,105 | $ | 52,591 | $ | 34,496 | ||||||||||
| Plus: Merger and conversion related expense, after tax | 563 | 1,102 | 651 | 13,724 | 2,042 | |||||||||||||||
| Net operating earnings (loss) (non-GAAP) | $ | 15,635 | $ | 16,026 | $ | 8,756 | $ | 66,315 | $ | 36,538 | ||||||||||
| Operating earnings per share - Basic | $ | 0.34 | $ | 0.35 | $ | 0.35 | $ | 1.44 | $ | 1.46 | ||||||||||
| Operating earnings per share - Diluted | 0.34 | 0.35 | 0.35 | 1.44 | 1.46 | |||||||||||||||
| Operating ROA | 0.86 | % | 0.88 | % | 0.85 | % | 0.91 | % | 0.90 | % | ||||||||||
| Operating ROE | 6.32 | % | 6.49 | % | 7.89 | % | 6.74 | % | 8.38 | % | ||||||||||
| Operating ROTCE | 9.51 | % | 9.82 | % | 9.43 | % | 10.19 | % | 10.07 | % | ||||||||||
| Community Bank Segment Operating Earnings (3) | ||||||||||||||||||||
| Net Income (GAAP) | $ | 15,961 | $ | 15,552 | $ | 10,002 | $ | 56,089 | $ | 37,155 | ||||||||||
| Plus: Merger and conversion related expense, after tax | 563 | 1,102 | 651 | 13,724 | 2,042 | |||||||||||||||
| Net operating earnings (loss) (non-GAAP) | $ | 16,524 | $ | 16,654 | $ | 10,653 | $ | 69,813 | $ | 39,197 | ||||||||||
| Operating earnings per share - Basic | $ | 0.36 | $ | 0.36 | $ | 0.43 | $ | 1.52 | $ | 1.57 | ||||||||||
| Operating earnings per share - Diluted | 0.36 | 0.36 | 0.43 | 1.52 | 1.57 | |||||||||||||||
| Operating ROA | 0.91 | % | 0.91 | % | 1.04 | % | 0.96 | % | 0.97 | % | ||||||||||
| Operating ROE | 6.70 | % | 6.77 | % | 9.79 | % | 7.14 | % | 9.18 | % | ||||||||||
| Operating ROTCE | 10.10 | % | 10.26 | % | 11.74 | % | 10.84 | % | 11.08 | % | ||||||||||
| Operating Efficiency Ratio FTE (3) | ||||||||||||||||||||
| Net Interest Income (GAAP) | $ | 63,065 | $ | 64,479 | $ | 38,613 | $ | 255,018 | $ | 151,626 | ||||||||||
| FTE adjustment | 2,005 | 2,058 | 1,387 | 8,127 | 5,256 | |||||||||||||||
| Net Interest Income (FTE) | $ | 65,070 | $ | 66,537 | $ | 40,000 | $ | 263,145 | $ | 156,882 | ||||||||||
| Noninterest Income (GAAP) | 14,901 | 16,318 | 8,379 | 61,287 | 38,728 | |||||||||||||||
| Noninterest Expense (GAAP) | $ | 52,634 | $ | 59,497 | $ | 35,375 | $ | 238,552 | $ | 137,289 | ||||||||||
| Merger and conversion related expense | 821 | 1,695 | 739 | 20,345 | 2,132 | |||||||||||||||
| Noninterest Expense (Non-GAAP) | $ | 51,813 | $ | 57,802 | $ | 34,636 | $ | 218,207 | $ | 135,157 | ||||||||||
| Operating Efficiency Ratio FTE (non-GAAP) | 64.79 | % | 69.76 | % | 71.59 | % | 67.26 | % | 69.10 | % | ||||||||||
| Community Bank Segment Operating Efficiency Ratio FTE (3) | ||||||||||||||||||||
| Net Interest Income (GAAP) | $ | 62,866 | $ | 64,162 | $ | 38,363 | $ | 253,956 | $ | 149,975 | ||||||||||
| FTE adjustment | 2,005 | 2,058 | 1,387 | 8,126 | 5,256 | |||||||||||||||
| Net Interest Income (FTE) | $ | 64,871 | $ | 66,220 | $ | 39,750 | $ | 262,082 | $ | 155,231 | ||||||||||
| Noninterest Income (GAAP) | 12,912 | 13,884 | 7,226 | 51,878 | 27,492 | |||||||||||||||
| Noninterest Expense (GAAP) | $ | 49,126 | $ | 55,764 | $ | 31,014 | $ | 222,647 | $ | 120,256 | ||||||||||
| Merger and conversion related expense | 821 | 1,695 | 739 | 20,345 | 2,132 | |||||||||||||||
| Noninterest Expense (Non-GAAP) | $ | 48,305 | $ | 54,069 | $ | 30,275 | $ | 202,302 | $ | 118,124 | ||||||||||
| Operating Efficiency Ratio FTE (non-GAAP) | 62.10 | % | 67.50 | % | 64.45 | % | 64.44 | % | 64.65 | % | ||||||||||
| Tangible Common Equity (4) | ||||||||||||||||||||
| Ending equity | $ | 978,025 | $ | 977,673 | $ | 438,239 | $ | 978,025 | $ | 438,239 | ||||||||||
| Less: Ending goodwill | 293,522 | 296,876 | 59,400 | 293,522 | 59,400 | |||||||||||||||
| Less: Ending core deposit intangibles | 31,755 | 34,089 | 11,980 | 31,755 | 11,980 | |||||||||||||||
| Ending tangible common equity | $ | 652,748 | $ | 646,708 | $ | 366,859 | $ | 652,748 | $ | 366,859 | ||||||||||
| Average equity | $ | 982,147 | $ | 979,659 | $ | 440,344 | $ | 984,582 | $ | 436,064 | ||||||||||
| Less: Average trademark intangible | - | - | - | - | 1 | |||||||||||||||
| Less: Average goodwill | 296,855 | 296,876 | 59,400 | 296,870 | 59,400 | |||||||||||||||
| Less: Average core deposit intangibles | 32,875 | 35,310 | 12,421 | 36,625 | 13,804 | |||||||||||||||
| Average tangible common equity | $ | 652,417 | $ | 647,473 | $ | 368,523 | $ | 651,087 | $ | 362,859 | ||||||||||
| Three Months Ended | Year Ended | |||||||||||||||||||
| 12/31/14 | 09/30/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||
| ALL to loans, adjusted for acquisition accounting (non-GAAP)(2) | ||||||||||||||||||||
| Allowance for loan losses | $ | 32,384 | $ | 32,109 | $ | 30,135 | $ | 32,384 | $ | 30,135 | ||||||||||
| Remaining credit mark on purchased performing loans | 24,340 | 25,064 | 3,341 | 24,340 | 3,341 | |||||||||||||||
| Adjusted allowance for loan losses | 56,724 | 57,173 | 33,476 | 56,724 | 33,476 | |||||||||||||||
| Loans, net of unearned income | 5,345,996 | 5,171,003 | 3,039,368 | 5,345,996 | 3,039,368 | |||||||||||||||
| Remaining credit mark on purchased performing loans | 24,340 | 25,064 | 3,341 | 24,340 | 3,341 | |||||||||||||||
| Less: Purchased credit impaired loans, net of credit mark | 105,788 | 119,743 | 3,622 | 105,788 | 3,622 | |||||||||||||||
| Adjusted loans, net of unearned income | $ | 5,264,548 | $ | 5,076,324 | $ | 3,039,087 | $ | 5,264,548 | $ | 3,039,087 | ||||||||||
| ALL / gross loans, adjusted for acquisition accounting | 1.08 | % | 1.12 | % | 1.10 | % | 1.08 | % | 1.10 | % | ||||||||||
| Mortgage Origination Volume | ||||||||||||||||||||
| Refinance Volume | $ | 58,662 | $ | 50,959 | $ | 47,887 | $ | 202,584 | $ | 366,262 | ||||||||||
| Construction Volume | 25,764 | 36,645 | 25,248 | 133,952 | 119,383 | |||||||||||||||
| Purchase Volume | 70,775 | 90,388 | 83,043 | 340,838 | 455,766 | |||||||||||||||
| Total Mortgage loan originations | $ | 155,201 | $ | 177,992 | $ | 156,178 | $ | 677,374 | $ | 941,411 | ||||||||||
| % of originations that are refinances | 37.80 | % | 28.63 | % | 30.70 | % | 29.91 | % | 38.90 | % | ||||||||||
| Other Data | ||||||||||||||||||||
| End of period full-time employees | 1,471 | 1,483 | 1,024 | 1,471 | 1,024 | |||||||||||||||
| Number of full-service branches | 131 | 131 | 90 | 131 | 90 | |||||||||||||||
| Number of full automatic transaction machines (ATMs) | 201 | 201 | 154 | 201 | 154 | |||||||||||||||
(1) The core net interest margin, fully taxable equivalent (“FTE”) excludes the impact of acquisition accounting accretion and amortization adjustments in net interest income.
(2) The allowance for loan losses, adjusted for acquisition accounting (non-GAAP) ratio includes an adjustment for the credit mark on purchased performing loans. The purchased performing loans are reported net of the related credit mark in loans, net of unearned income, on the Company’s Consolidated Balance Sheet; therefore, the credit mark is added back to the balance to represent the total loan portfolio. The adjusted allowance for loan losses, including the credit mark, represents the total reserve on the Company’s loan portfolio. The PCI loans, net of the respective credit mark, are removed from the loans, net of unearned income, as these loans are not covered by the allowance established by the Company unless changes in expected cash flows indicate that one of the PCI loan pools are impaired, at which time an allowance for PCI loans will be established. GAAP requires the acquired allowance for loan losses not be carried over in an acquisition or merger. The Company believes the presentation of the allowance for loan losses, adjusted for acquisition accounting, ratio is useful to investors because the acquired loans were purchased at a market discount with no allowance for loan losses carried over to the Company, and the credit mark on the purchased performing loans represents the allowance associated with those purchased loans. The Company believes that this measure is a better reflection of the reserves on the Company’s loan portfolio.
(3) The Company has provided supplemental performance measures which the Company believes may be useful to investors as they exclude non-operating adjustments resulting from acquisition activity and allow investors to see the combined economic results of the organization. These measures are a supplement to GAAP used to prepare the Company’s financial statements and should not be viewed as a substitute for GAAP measures. In addition, the Company’s non-GAAP measures may not be comparable to non-GAAP measures of other companies.
(4) Tangible common equity is used in the calculation of certain capital and per share ratios. The Company believes tangible common equity and the related ratios are meaningful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which the Company believes will assist investors in assessing the capital of the Company and its ability to absorb potential losses.
(5) December 31, 2014 ratios are estimates and subject to change pending the filing of the FR Y9-C. All other periods presented as filed.
UNION BANKSHARES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share data)
| December 31, | December 31, | |||||||
| 2014 | 2013 | |||||||
| (Unaudited) | (Audited) | |||||||
| ASSETS | ||||||||
| Cash and cash equivalents: | ||||||||
| Cash and due from banks | $ | 112,752 | $ | 66,090 | ||||
| Interest-bearing deposits in other banks | 19,344 | 6,781 | ||||||
| Money market investments | 1 | 1 | ||||||
| Federal funds sold | 1,163 | 151 | ||||||
| Total cash and cash equivalents | 133,260 | 73,023 | ||||||
| Securities available for sale, at fair value | 1,102,114 | 677,348 | ||||||
| Restricted stock, at cost | 54,854 | 26,036 | ||||||
| Loans held for sale, net | 43,032 | 53,185 | ||||||
| Loans, net of unearned income | 5,345,996 | 3,039,368 | ||||||
| Less allowance for loan losses | 32,384 | 30,135 | ||||||
| Net loans | 5,313,612 | 3,009,233 | ||||||
| Bank premises and equipment, net | 135,247 | 82,815 | ||||||
| Other real estate owned, net of valuation allowance | 28,118 | 34,116 | ||||||
| Core deposit intangibles, net | 31,755 | 11,980 | ||||||
| Goodwill | 293,522 | 59,400 | ||||||
| Bank owned life insurance | 139,005 | 88,468 | ||||||
| Other assets | 84,652 | 60,967 | ||||||
| Total assets | $ | 7,359,171 | $ | 4,176,571 | ||||
| LIABILITIES | ||||||||
| Noninterest-bearing demand deposits | $ | 1,199,378 | $ | 691,674 | ||||
| Interest-bearing deposits | 4,439,392 | 2,545,168 | ||||||
| Total deposits | 5,638,770 | 3,236,842 | ||||||
| Securities sold under agreements to repurchase | 44,393 | 52,455 | ||||||
| Other short-term borrowings | 343,000 | 211,500 | ||||||
| Long-term borrowings | 299,542 | 199,359 | ||||||
| Other liabilities | 55,441 | 38,176 | ||||||
| Total liabilities | 6,381,146 | 3,738,332 | ||||||
| Commitments and contingencies | ||||||||
| STOCKHOLDERS' EQUITY | ||||||||
| Common stock, $1.33 par value, shares authorized 100,000,000 and 36,000,000, respectively; issued and outstanding, 45,162,853 shares and 24,976,434 shares, respectively. | 59,795 | 33,020 | ||||||
| Surplus | 643,443 | 170,770 | ||||||
| Retained earnings | 262,532 | 236,639 | ||||||
| Accumulated other comprehensive income (loss) | 12,255 | (2,190 | ) | |||||
| Total stockholders' equity | 978,025 | 438,239 | ||||||
| Total liabilities and stockholders' equity | $ | 7,359,171 | $ | 4,176,571 | ||||
UNION BANKSHARES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)
| Three Months Ended | Year Ended | |||||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Interest and dividend income: | ||||||||||||||||
| Interest and fees on loans | $ | 61,369 | $ | 38,741 | $ | 246,365 | $ | 155,547 | ||||||||
| Interest on federal funds sold | 1 | - | 1 | 1 | ||||||||||||
| Interest on deposits in other banks | 19 | 3 | 60 | 17 | ||||||||||||
| Interest and dividends on securities: | ||||||||||||||||
| Taxable | 3,834 | 2,345 | 15,226 | 8,202 | ||||||||||||
| Nontaxable | 3,288 | 2,226 | 13,293 | 8,360 | ||||||||||||
| Total interest and dividend income | 68,511 | 43,315 | 274,945 | 172,127 | ||||||||||||
| Interest expense: | ||||||||||||||||
| Interest on deposits | 3,201 | 3,064 | 11,034 | 14,097 | ||||||||||||
| Interest on federal funds purchased | 1 | 27 | 50 | 89 | ||||||||||||
| Interest on short-term borrowings | 143 | 95 | 516 | 265 | ||||||||||||
| Interest on long-term borrowings | 2,101 | 1,516 | 8,327 | 6,050 | ||||||||||||
| Total interest expense | 5,446 | 4,702 | 19,927 | 20,501 | ||||||||||||
| Net interest income | 63,065 | 38,613 | 255,018 | 151,626 | ||||||||||||
| Provision for loan losses | 4,500 | 1,206 | 7,800 | 6,056 | ||||||||||||
| Net interest income after provision for loan losses | 58,565 | 37,407 | 247,218 | 145,570 | ||||||||||||
| Noninterest income: | ||||||||||||||||
| Service charges on deposit accounts | 4,440 | 2,399 | 17,721 | 9,492 | ||||||||||||
| Other service charges, commissions and fees | 3,701 | 2,176 | 14,983 | 8,607 | ||||||||||||
| Fiduciary and asset management fees | 2,282 | 1,324 | 9,036 | 5,183 | ||||||||||||
| Gains on sales of mortgage loans, net of commissions | 1,782 | 1,319 | 9,707 | 11,900 | ||||||||||||
| Gains (losses) on securities transactions, net | 246 | (26 | ) | 1,695 | 21 | |||||||||||
| Gains (losses) on sales of bank premises | 200 | (3 | ) | (184 | ) | (340 | ) | |||||||||
| Bank owned life insurance income | 1,181 | 800 | 4,648 | 2,311 | ||||||||||||
| Other operating income | 1,069 | 390 | 3,681 | 1,554 | ||||||||||||
| Total noninterest income | 14,901 | 8,379 | 61,287 | 38,728 | ||||||||||||
| Noninterest expenses: | ||||||||||||||||
| Salaries and benefits | 25,338 | 17,076 | 107,804 | 70,369 | ||||||||||||
| Occupancy expenses | 4,952 | 3,105 | 20,136 | 11,543 | ||||||||||||
| Furniture and equipment expenses | 3,317 | 1,633 | 11,872 | 6,884 | ||||||||||||
| Printing, postage, and supplies | 1,242 | 712 | 4,924 | 2,970 | ||||||||||||
| Communications expense | 1,161 | 611 | 4,902 | 2,681 | ||||||||||||
| Technology and data processing | 3,319 | 1,975 | 12,465 | 7,754 | ||||||||||||
| Professional services | 1,697 | 1,237 | 5,594 | 3,419 | ||||||||||||
| Marketing and advertising expense | 1,585 | 1,135 | 6,406 | 4,312 | ||||||||||||
| FDIC assessment premiums and other insurance | 1,562 | 805 | 6,125 | 3,110 | ||||||||||||
| Other taxes | 1,432 | 787 | 5,784 | 3,181 | ||||||||||||
| Loan-related expenses | 685 | 451 | 2,672 | 2,447 | ||||||||||||
| OREO and credit-related expenses (recovery) | (89 | ) | 1,721 | 10,164 | 4,880 | |||||||||||
| Amortization of intangible assets | 2,334 | 919 | 9,795 | 3,831 | ||||||||||||
| Acquisition and conversion costs | 821 | 739 | 20,345 | 2,132 | ||||||||||||
| Other expenses | 3,278 | 2,469 | 9,564 | 7,776 | ||||||||||||
| Total noninterest expenses | 52,634 | 35,375 | 238,552 | 137,289 | ||||||||||||
| Income before income taxes | 20,832 | 10,411 | 69,953 | 47,009 | ||||||||||||
| Income tax expense | 5,760 | 2,306 | 17,362 | 12,513 | ||||||||||||
| Net income | $ | 15,072 | $ | 8,105 | $ | 52,591 | $ | 34,496 | ||||||||
| Earnings per common share, basic | $ | 0.33 | $ | 0.32 | $ | 1.14 | $ | 1.38 | ||||||||
| Earnings per common share, diluted | $ | 0.33 | $ | 0.32 | $ | 1.14 | $ | 1.38 | ||||||||
UNION BANKSHARES CORPORATION AND SUBSIDIARIES
SEGMENT FINANCIAL INFORMATION
(Dollars in thousands)
| Community Bank | Mortgage | Eliminations | Consolidated | |||||||||||||
| Three Months Ended December 31, 2014 | ||||||||||||||||
| Net interest income | $ | 62,866 | $ | 199 | $ | - | $ | 63,065 | ||||||||
| Provision for loan losses | 4,500 | - | - | 4,500 | ||||||||||||
| Net interest income after provision for loan losses | 58,366 | 199 | - | 58,565 | ||||||||||||
| Noninterest income | 12,912 | 2,160 | (171 | ) | 14,901 | |||||||||||
| Noninterest expenses | 49,126 | 3,679 | (171 | ) | 52,634 | |||||||||||
| Income (loss) before income taxes | 22,152 | (1,320 | ) | - | 20,832 | |||||||||||
| Income tax expense (benefit) | 6,191 | (431 | ) | - | 5,760 | |||||||||||
| Net income (loss) | $ | 15,961 | $ | (889 | ) | $ | - | $ | 15,072 | |||||||
| Plus: Merger and conversion related expense, after tax | 563 | - | - | 563 | ||||||||||||
| Net operating earnings (loss) (non-GAAP) | $ | 16,524 | $ | (889 | ) | $ | - | $ | 15,635 | |||||||
| Total assets | $ | 7,354,586 | $ | 51,485 | $ | (46,900 | ) | $ | 7,359,171 | |||||||
| Three Months Ended December 31, 2013 | ||||||||||||||||
| Net interest income | $ | 38,363 | $ | 250 | $ | - | $ | 38,613 | ||||||||
| Provision for loan losses | 1,206 | - | - | 1,206 | ||||||||||||
| Net interest income after provision for loan losses | 37,157 | 250 | - | 37,407 | ||||||||||||
| Noninterest income | 7,226 | 1,320 | (167 | ) | 8,379 | |||||||||||
| Noninterest expenses | 31,014 | 4,528 | (167 | ) | 35,375 | |||||||||||
| Income (loss) before income taxes | 13,369 | (2,958 | ) | - | 10,411 | |||||||||||
| Income tax expense (benefit) | 3,367 | (1,061 | ) | - | 2,306 | |||||||||||
| Net income (loss) | $ | 10,002 | $ | (1,897 | ) | $ | - | $ | 8,105 | |||||||
| Plus: Merger and conversion related expense, after tax | 651 | - | - | 651 | ||||||||||||
| Net operating earnings (loss) (non-GAAP) | $ | 10,653 | $ | (1,897 | ) | $ | - | $ | 8,756 | |||||||
| Total assets | $ | 4,170,682 | $ | 63,715 | $ | (57,826 | ) | $ | 4,176,571 | |||||||
| Year Ended December 31, 2014 | ||||||||||||||||
| Net interest income | $ | 253,956 | $ | 1,062 | $ | - | $ | 255,018 | ||||||||
| Provision for loan losses | 7,800 | - | - | 7,800 | ||||||||||||
| Net interest income after provision for loan losses | 246,156 | 1,062 | - | 247,218 | ||||||||||||
| Noninterest income | 51,878 | 10,091 | (682 | ) | 61,287 | |||||||||||
| Noninterest expenses | 222,647 | 16,587 | (682 | ) | 238,552 | |||||||||||
| Income (loss) before income taxes | 75,387 | (5,434 | ) | - | 69,953 | |||||||||||
| Income tax expense (benefit) | 19,298 | (1,936 | ) | - | 17,362 | |||||||||||
| Net income (loss) | $ | 56,089 | $ | (3,498 | ) | $ | - | $ | 52,591 | |||||||
| Plus: Merger and conversion related expense, after tax | 13,724 | - | - | 13,724 | ||||||||||||
| Net operating earnings (loss) (non-GAAP) | $ | 69,813 | $ | (3,498 | ) | $ | - | $ | 66,315 | |||||||
| Total assets | $ | 7,354,586 | $ | 51,485 | $ | (46,900 | ) | $ | 7,359,171 | |||||||
| Year Ended December 31, 2013 | ||||||||||||||||
| Net interest income | $ | 149,975 | $ | 1,651 | $ | - | $ | 151,626 | ||||||||
| Provision for loan losses | 6,056 | - | - | 6,056 | ||||||||||||
| Net interest income after provision for loan losses | 143,919 | 1,651 | - | 145,570 | ||||||||||||
| Noninterest income | 27,492 | 11,906 | (670 | ) | 38,728 | |||||||||||
| Noninterest expenses | 120,256 | 17,703 | (670 | ) | 137,289 | |||||||||||
| Income (loss) before income taxes | 51,155 | (4,146 | ) | - | 47,009 | |||||||||||
| Income tax expense (benefit) | 14,000 | (1,487 | ) | - | 12,513 | |||||||||||
| Net income (loss) | $ | 37,155 | $ | (2,659 | ) | $ | - | $ | 34,496 | |||||||
| Plus: Merger and conversion related expense, after tax | 2,042 | - | - | 2,042 | ||||||||||||
| Net operating earnings (loss) (non-GAAP) | $ | 39,197 | $ | (2,659 | ) | $ | - | $ | 36,538 | |||||||
| Total assets | $ | 4,170,682 | $ | 63,715 | $ | (57,826 | ) | $ | 4,176,571 | |||||||
AVERAGE BALANCES, INCOME AND EXPENSES, YIELDS AND RATES (TAXABLE EQUIVALENT BASIS)
| For the Quarter Ended | ||||||||||||||||||||||||
| December 31, 2014 | September 30, 2014 | |||||||||||||||||||||||
| Average Balance | Interest Income / Expense | Yield / Rate (1) | Average Balance | Interest Income / Expense | Yield / Rate (1) | |||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||
| Securities: | ||||||||||||||||||||||||
| Taxable | $ | 739,227 | $ | 3,834 | 2.06 | % | $ | 738,932 | $ | 3,883 | 2.08 | % | ||||||||||||
| Tax-exempt | 406,231 | 5,059 | 4.94 | % | 404,371 | 5,150 | 5.05 | % | ||||||||||||||||
| Total securities | 1,145,458 | 8,893 | 3.08 | % | 1,143,303 | 9,033 | 3.13 | % | ||||||||||||||||
| Loans, net (2) (3) | 5,220,223 | 61,272 | 4.66 | % | 5,196,116 | 62,082 | 4.74 | % | ||||||||||||||||
| Loans held for sale | 34,740 | 331 | 3.78 | % | 50,393 | 513 | 4.04 | % | ||||||||||||||||
| Federal funds sold | 1,292 | 1 | 0.21 | % | 684 | - | 0.18 | % | ||||||||||||||||
| Money market investments | 1 | - | 0.00 | % | 1 | - | 0.00 | % | ||||||||||||||||
| Interest-bearing deposits in other banks | 32,278 | 19 | 0.23 | % | 33,246 | 21 | 0.24 | % | ||||||||||||||||
| Total earning assets | 6,433,992 | $ | 70,516 | 4.35 | % | 6,423,743 | $ | 71,649 | 4.43 | % | ||||||||||||||
| Allowance for loan losses | (31,759 | ) | (31,631 | ) | ||||||||||||||||||||
| Total non-earning assets | 835,787 | 849,712 | ||||||||||||||||||||||
| Total assets | $ | 7,238,020 | $ | 7,241,824 | ||||||||||||||||||||
| Liabilities and Stockholders' Equity: | ||||||||||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||||||||||
| Transaction and money market accounts | $ | 2,568,628 | $ | 1,178 | 0.18 | % | $ | 2,582,746 | $ | 1,247 | 0.19 | % | ||||||||||||
| Regular savings | 550,545 | 278 | 0.20 | % | 554,202 | 275 | 0.20 | % | ||||||||||||||||
| Time deposits (4) | 1,318,005 | 1,745 | 0.53 | % | 1,370,299 | 1,505 | 0.44 | % | ||||||||||||||||
| Total interest-bearing deposits | 4,437,178 | 3,201 | 0.29 | % | 4,507,247 | 3,027 | 0.27 | % | ||||||||||||||||
| Other borrowings (5) | 536,639 | 2,245 | 1.66 | % | 507,882 | 2,085 | 1.63 | % | ||||||||||||||||
| Total interest-bearing liabilities | 4,973,817 | $ | 5,446 | 0.43 | % | 5,015,129 | $ | 5,112 | 0.40 | % | ||||||||||||||
| Noninterest-bearing liabilities: | ||||||||||||||||||||||||
| Demand deposits | 1,223,646 | 1,194,505 | ||||||||||||||||||||||
| Other liabilities | 58,410 | 52,531 | ||||||||||||||||||||||
| Total liabilities | 6,255,873 | 6,262,165 | ||||||||||||||||||||||
| Stockholders' equity | 982,147 | 979,659 | ||||||||||||||||||||||
| Total liabilities and stockholders' equity | $ | 7,238,020 | $ | 7,241,824 | ||||||||||||||||||||
| Net interest income | $ | 65,070 | $ | 66,537 | ||||||||||||||||||||
| Interest rate spread (6) | 3.92 | % | 4.03 | % | ||||||||||||||||||||
| Interest expense as a percent of average earning assets | 0.34 | % | 0.32 | % | ||||||||||||||||||||
| Net interest margin (7) | 4.01 | % | 4.11 | % | ||||||||||||||||||||
(1) Rates and yields are annualized and calculated from actual, not rounded amounts in thousands, which appear above.
(2) Nonaccrual loans are included in average loans outstanding.
(3) Interest income on loans includes $504,000 and $846,000 for the three months ended December 31, 2014 and September 30, 2014 in accretion of the fair market value adjustments related to acquisitions.
(4) Interest expense on certificates of deposits includes $1.5 million and $2.0 million for the three months ended December 31, 2014 and September 30, 2014 in accretion of the fair market value adjustments related to acquisitions.
(5) Interest expense on borrowings includes $137,000 and $262,000 for the three months ended December 31, 2014 and September 30, 2014 in amortization of the fair market value adjustments related to acquisitions.
(6) Income and yields are reported on a taxable equivalent basis using the statutory federal corporate tax rate of 35%.
(7) Core net interest margin excludes purchase accounting adjustments and was 3.88% and 3.92% for the three months ended December 31, 2014 and September 30, 2014.