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Atlantic Capital Bancshares, Inc. (ACBI)
Presentation to Investments Unlimited
March 20, 2017
Forward-Looking Statements
This presentation contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933, as amended, and section
21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect our current views with respect to, among
other things, future events and our financial performance. These statements are often, but not always, made through the use of words or
phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,”
“estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” or the negative version of those words or other comparable of a future or
forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and
projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are
inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future
performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe that the expectations
reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the
results expressed or implied by the forward-looking statements.
The following risks, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in
the forward-looking statements: (1) the expected growth opportunities and cost savings from the transaction with First Security Group, Inc.
(“First Security”) may not be fully realized or may take longer to realize than expected; (2) loss of income from our TriNet division following our
exit of this business; (3) changes in asset quality and credit risk; (4) the cost and availability of capital; (5) customer acceptance of our products
and services; (6) customer borrowing, repayment, investment and deposit practices; (7) the introduction, withdrawal, success and timing of
business initiatives; (8) the impact, extent, and timing of technological changes; (9) severe catastrophic events in our geographic area; (10) a
weakening of the economies in which we conduct operations may adversely affect our operating results; (11) the U.S. legal and regulatory
framework, including those associated with the Dodd-Frank Wall Street Reform and Consumer Protection Act could adversely affect the
operating results of the combined company; (12) the interest rate environment may compress margins and adversely affect net interest income;
(13) changes in trade, monetary and fiscal policies of various governmental bodies and central banks could affect the economic environment in
which we operate; (14) our ability to determine accurate values of certain assets and liabilities; (15) adverse developments in securities, public
debt, and capital markets, including changes in market liquidity and volatility; (16) our ability to anticipate interest rate changes correctly and
manage interest rate risk presented through unanticipated changes in our interest rate risk position and/or short- and long-term interest rates;
(17) unanticipated changes in our liquidity position, including but not limited to our ability to enter the financial markets to manage and respond
to any changes to our liquidity position; (18) adequacy of our risk management program; (19) increased costs associated with operating as a
public company; (20) competition from other financial services companies in the companies’ markets could adversely affect operations; and (21)
other factors described in Atlantic Capital’s reports filed with the Securities and Exchange Commission and available on the SEC’s website
(www.sec.gov).
2
Non-GAAP Financial Information
Statements included in this presentation include non-GAAP financial measures and should be read long with the accompanying tables, which
provide a reconciliation of non-GAAP financial measures to GAAP financial measures. Atlantic Capital management uses non-GAAP financial
measures, including: (i) operating net income; (ii) operating non-interest expense; (iii) operating provision for loan losses, (iv) taxable equivalent
net interest margin, (v) efficiency ratio (vi) operating return on assets; (vii) operating return on equity: (viii) tangible common equity and (ix)
deposits excluding deposits assumed in branch sales, in its analysis of the Company's performance.
Management believes that non-GAAP financial measures provide a greater understanding of ongoing performance and operations, and enhance
comparability with prior periods. Non-GAAP financial measures should not be considered as an alternative to any measure of performance or
financial condition as determined in accordance with GAAP, and investors should consider Atlantic Capital’s performance and financial condition
as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP
financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the
results or financial condition as reported under GAAP. Non-GAAP financial measures may not be comparable to non-GAAP financial measures
presented by other companies.
3
• Established in May 2007 with $125 million in equity capital, which was, and still is, the largest de novo bank
capital raise in US history
• Publicly traded on NASDAQ since November 2nd, 2015, under the symbol “ACBI”
• Exceptional record of soundness and growth through financial crisis, recession and recent recovery
• Differentiated by providing superior expertise, competitive capabilities, and customized service delivery
4
Atlantic Capital Bank: Our Story
Atlantic Capital Bank: Highlights
5
Target Markets:
• Small to mid-sized enterprises with revenues up to $250 million
• Highly-select group of institutional caliber commercial real estate developers and investors
• Principals of our commercial clients, professionals, and their practices
• Has grown to $2.8 billion in assets
• Initiatives in place to maintain robust top line growth
• Operating model expected to produce enhanced efficiencies going forward
• Consistently maintaining high asset quality
• NPAs/total assets 0.13% as of December 31, 2016
Main corporate offices in Atlanta, Georgia and Chattanooga, Tennessee with multiple branch
locations throughout Georgia, Tennessee and North Carolina.
• Strong leadership continuity in key markets
• Broad management experience in all business lines
Proprietary & Confidential
Atlantic Capital Strategy
6
Accelerated Organic Growth
• Investing in people and capabilities to accelerate organic growth and build profitability
• Well positioned in attractive growth markets
• Attractive interest rate risk position
Strategic Expansion
• Completed acquisition of First Security on October 31, 2015
• Ongoing evaluation of new market expansion through mergers
and acquisitions and de novo entry
• Patient and disciplined approach with focus on shareholder value
7
Key Investment Considerations
Attractive Growth Markets
Strong Deposit Growth
Asset Sensitivity
Loan Growth with Superior Credit Quality
Atlantic Capital Bank Locations
8
Branch Location
Loan Production Office
Main Office Location
Legend
A leading middle market commercial bank operating throughout the southeast
Attractive Market Demographics
1) In thousands; Source: US MSA Census Information + market data from Data.com (Salesforce). 9
City
MSA
Population1
Projected
population growth
for the
next 3 years
# Target
Companies
(>$10MM REV)
# Total
businesses
(>$5MM REV)
# Total
businesses
Median
Household
Income
Atlanta 5,614 6.2% 4,271 8,600 1,261,291 $51,948
Chattanooga 544 3.0% 351 695 88,967 $37,411
Charlotte 2,380 7.4% 1,583 3,028 314,130 $46,119
Knoxville 857 2.4% 535 1,023 112,095 $36,874
$0
$500
$1,000
$1,500
$2,000
$2,500
2012 2013 2014 2015 2016
10
Financial Highlights: Deposit Growth
*Dollars in millions; excludes deposits to be assumed in branch sale. This is a non-GAAP financial measure. Please see “Non-GAAP Reconciliation”
on slides 27 and 28 for more details.
DDA
NOW /
Savings /
Money
Market
Time
Brokered
16% 23%
29%
27%
29%
74% 68% 60%
55% 55%
3%
7%
1%
8%
1%
10%
9%
9% 7%
9%
$1,026 $1,081
$1,106
$2,049
$2,206
*
11
Financial Highlights: Deposits
*Dollars in millions; excludes deposits to be assumed in branch sale. This is a non-GAAP financial measure. Please see “Non-GAAP Reconciliation”
on slides 27 and 28 for more details.
$0
$500
$1,000
$1,500
$2,000
$2,500
Dec. 31, 2015 Mar. 31, 2016 Jun. 30, 2016 Sep. 30, 2016 Dec. 31, 2016
27% 27% 27% 25%
29%
55% 53%
55% 58%
55%
9% 9%
8%
8% 7%
9% 11%
10%
9% 9%
$2,049
$2,206$2,189$2,158
$2,085
DDA
NOW /
Savings /
Money
Market
Time
Brokered
*
12
Financial Highlights:
$15,978
$18,921 $19,283
$19,487 $19,501
3.13%
3.26%
3.12% 3.12% 3.11%
2.96%
3.05%
3.00% 3.00% 2.99%
2.80%
2.85%
2.90%
2.95%
3.00%
3.05%
3.10%
3.15%
3.20%
3.25%
3.30%
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
$20,000
Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016
Net interest income (TE) Net interest margin (TE) Net interest margin (excl. purchase accounting)
*Dollars in thousands; this is a non-GAAP financial measure. Please see “Non-GAAP Reconciliation” on slides 27 and 28 for more details.
Taxable Equivalent Net
Interest Income & Margin*
Financial Highlights: Asset Sensitivity
Change in Net Interest Income
13
0%
5%
10%
15%
20%
25%
Up 100 bps Up 200 bps Up 300 bps
8.2%
16.4%
20.3%
1 Year
As of December 31, 2016:
64% of loans are variable rate
29% of deposits are noninterest bearing
Financial Highlights: Total Loan Growth
14
$0
$500
$1,000
$1,500
$2,000
$2,500
2012 2013 2014 2015 2016
$811 $817
$1,040
$1,886
$2,017
15
Financial Highlights: Loans Held for Investment
*Dollars in millions
$0
$500
$1,000
$1,500
$2,000
$2,500
Dec. 31, 2015 Mar. 31, 2016 Jun. 30, 2016 Sep. 30, 2016 Dec. 31, 2016
$1,480 $1,527
$1,580 $1,610 $1,609
$227
$236
$236 $227 $224
$84
$124
$126
$171 $148
$1,791
$1,887
$1,942
$2,008 $1,981
Commercial
Other
Mortgage
warehouse
Financial Highlights: Credit Quality
16
Q4' 15 Q1 '16 Q2 '16 Q3 '16 Q4 '16
0.40%
0.08%
0.07%
0.09%
0.13%
Allowance for Loan Losses/
Non-Performing Assets
Q4 '15 Q1 '16 Q2 '16 Q3 '16 Q4 '16
180%
757%
981%
736%
591%
Net Charge Offs/Total Average Loans* Allowance for Loan Losses/Total Loans
Q4 '15 Q1 '16 Q2 '16 Q3 '16 Q4 '16
1.06%
0.93%
0.95%
0.92%
1.04%
Non-Performing Assets/Total Assets
Q4 '15 Q1 '16 Q2 '16 Q3 '16 Q4 '16
0.15%
0.35%
0.00%
0.06%
0.03%
YTD 2016: 0.11%
*Annualized
17
Financial Highlights
Financial
Performance
Balance Sheet
Capital
Asset Quality
Diluted EPS $ 0.06 $ 0.15 $ 0.20 $ 0.12 $ (0.40)
Diluted EPS – operating 0.07 0.16 0.15 0.14 0.02
Efficiency ratio (1) 78.33 % 71.57 % 72.00 % 75.22 % 82.79 %
Return on average assets – operating (1) (2) (3) (5) 0.25 0.60 0.54 0.52 0.07
Net interest margin (tax equivalent) 3.11 3.12 3.12 3.26 3.13
Total assets(4) $ 2,728 $ 2,761 $ 2,809 $ 2,725 $ 2,639
Commercial loans held for investment (4)(6) 1,609 1,610 1,580 1,527 1,480
Deposits (excl. to be assumed in branch sale) (4) 2,206 2,189 2,158 2,085 2,049
Tier 1 capital ratio 10.30 % 9.68 % 9.99 % 9.48 % 9.80 %
Total risk-based capital ratio 13.31 12.50 12.96 12.37 12.93
Tangible common equity to tangible assets 10.16 10.19 9.81 9.69 9.71
NCOs to average loans (5) 0.03 % 0.06 % 0.00 % 0.35 % 0.15 %
NPAs to total assets 0.13 0.09 0.07 0.08 0.40
Allowance for loan and lease losses to loans held for
investment
1.04 0.92 0.95 0.93 1.06
(1) This is a non-GAAP financial measure. Please see “Non-GAAP Reconciliation” on slides 27 and 28 for more details.(2) Excludes provision for acquired non PCI
FSG loans. (3) Excludes merger related expenses. (4) Dollars in millions. (5) Annualized. (6) Excluding mortgage warehouse loans.
METRICS Q4 ‘16 Q3 ‘16 Q2 ‘16 Q1 ‘16 Q4 ‘15
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
$10,000
Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016
$1,265 $1,498 $1,392 $1,270 $1,327
$163
$339 $447 $632 $499 $192
$314 $386 $361 $350
$383
$761
$357
$904
$880
$1,204
$959 $599
$936
$1,006
$4,690
$780
$1,298
$4,420
$8,880
$4,002
$4,430
18
Financial Highlights: Noninterest Income
*Dollars in thousands
$3,885 gain on
sale of branches
Service charges
Other
noninterest
income
SBA lending
Trust income
Mortgage
income
TriNet lending
$4,995
$3,460
19
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
$20,000
Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016
$9,661
$10,555 $10,420 $10,059
$11,269
$907
$1,100 $1,274
$1,235
$995
$1,020
$748 $760
$442
$968
$555
$916 $694
$617
$1,064
$3,924
$4,198 $4,280
$4,364
$4,275
Financial Highlights: Operating Noninterest Expense
$16,067
$17,517 $17,428
$16,717
$18,571
*Dollars in thousands
Salaries and
employee
benefits
Occupancy
Professional
services
Data processing
Other
noninterest
expense
20
Financial Highlights: Regulatory Capital - 12/31/16
0%
2%
4%
6%
8%
10%
12%
14%
Bank Bank
5%
6.5%
8%
10%
Minimum requirements to be “well capitalized” under applicable
regulations
10.4%
9.1%
11.8%
10.3%
11.8%
10.3%
12.7%
13.3%
Holding
Company
Bank BankHolding
Company
Holding
Company
Holding
Company
Tier 1 leverage ratio Common equity tier 1 capital ratio Tier 1 capital ratio Total capital ratio
APPENDIX
Management Biographies
22
Douglas Williams
Chief Executive Officer
• CEO of Atlantic Capital since its inception
• Former Managing Director and Head of Wachovia Corporation’s International Corporate Finance Group
• Held numerous roles within Wachovia, including EVP and Head of the Global Corporate Banking Division; CRO for all corporate, institutional, and wholesale
banking activities; EVP and Co-Head of Wachovia’s Capital Markets Division and EVP and Head of Wachovia’s US Corporate Banking Division
• Chairman of the Community Depository Institutions Advisory Council (CDIAC) of the Federal Reserve Bank of Atlanta and its representative to the CDIAC of the
Federal Reserve Board of Governors
• Serves on the Boards of the Metro Atlanta Chamber of Commerce, the Georgia Chamber of Commerce, and the YMCA of Metropolitan Atlanta and the High
Museum of Art and is a Member of the Buckhead Coalition
Michael Kramer
President, Chief Operating Officer
• CEO and President of First Security since December and CEO of FSGBank since 2011
• Former Managing Director of Ridley Capital Group
• Former Director, CEO and President of Ohio Legacy Corporation
• Former COO and CTO of Integra Bank Corporation
• Serves on the Boards of Chattanooga Chamber of Commerce, Chattanooga United Way, The Tennessee Bankers Association and the Chattanooga Young Life
Committee
Patrick Oakes
Executive Vice President,
Chief Financial Officer
• Former CFO of Square 1 Financial, Inc.
• Former EVP and CFO of Encore Bancshares, Inc.
• Former SVP and Treasurer for Sterling Bancshares, Inc.
• Chartered Financial Analyst
Rich Oglesby
Executive Vice President,
Chief Risk Officer
• CRO of Atlantic Capital since its inception
• Former Chief Credit Officer for Wachovia’s Capital Finance business
• Former Head of Risk Management for all of Wachovia’s Capital Markets business
• Serves on the Board of Trustees at Children’s Literature for Children
23
ACBI Historical Balance Sheets
December 31, September 30, December 31,
(in thousands, except share data) 2016 2016 2015
ASSETS
Cash and due from banks $ 36,790 $ 44,563 $ 45,848
Interest-bearing depos i ts in banks 118,039 75,750 130,900
Other short-term investments 10,896 23,159 26,137
Cash and cash equiva lents 165,725 143,472 202,885
Securi ties ava i lable-for-sa le 347,705 348,484 346,221
Other investments 23,806 26,370 8,034
Loans held for sa le 35,219 46,600 95,465
Loans held for investment 1,981,330 2,008,102 1,790,669
Less : a l lowance for loan losses (20,595) (18,534) (18,905)
Loans held for investment, net 1,960,735 1,989,568 1,771,764
Branch premises held for sa le 2,995 5,201 7,200
Premises and equipment, net 11,958 15,213 23,145
Bank owned l i fe insurance 62,160 61,766 60,608
Goodwi l l and intangible assets , net 29,567 30,071 35,232
Other rea l estate owned 1,872 1,727 1,982
Other assets 85,801 92,772 86,244
Total assets $ 2,727,543 $ 2,761,244 $ 2,638,780
LIABILITIES AND SHAREHOLDERS' EQUITY
Depos its :
Noninterest-bearing demand $ 643,471 $ 557,783 $ 544,561
Interest-bearing checking 264,062 260,531 232,868
Savings 27,932 29,658 28,922
Money market 912,493 974,072 875,441
Time 157,810 172,348 183,206
Brokered depos i ts 200,223 194,464 183,810
Depos i ts to be assumed in branch sa le 31,589 – 213,410
Tota l depos i ts 2,237,580 2,188,856 2,262,218
Federa l funds purchased and securi ties sold under agreements to repurchase – – 11,931
Federa l Home Loan Bank borrowings 110,000 170,000 –
Long-term debt 49,366 49,324 49,197
Other l iabi l i ties 26,939 44,601 27,442
Total liabilities 2,423,885 2,452,781 2,350,788
SHAREHOLDERS' EQUITY
Preferred s tock, no par va lue; 10,000,000 shares authorized; no shares i ssued and
as of December 31, 2016, September 30, 2016, and December 31, 2015 – – –
Commo stock, no par va lue; 100,000,000 shares authorized;
25,093,135, 24,950,099, and 24,425,546 shares i ssued and outstanding as of
December 31, 2016, September 30, 2016, and December 31, 2015, respectively 292,747 290,835 286,367
Reta ined earnings 16,536 14,927 3,141
Accumulated other comprehens ive income (loss ) (5,625) 2,701 (1,516)
Total shareholders’ equity 303,658 308,463 287,992
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 2,727,543 $ 2,761,244 $ 2,638,780
Atlantic Capital Bancshares, Inc.
Consolidated Balance Sheets (unaudited)
24
ACBI Historical Income Statements
Atlantic Capital Bancshares, Inc.
Consolidated Statements of Income (unaudited)
(in thousands except share and per share data)
December
31, 2016
September
30, 2016
June 30, 2016
March 31,
2016
December 31,
2015
December 31,
2016
December 31,
2015
INTEREST INCOME
Loans , including fees $ 20,363 $ 20,511 $ 20,282 $ 19,625 $ 16,688 $ 80,781 $ 44,562
Investment securi ties - ava i lable-for-sa le 1,477 1,293 1,327 1,601 1,224 5,698 3,301
Interest and dividends on other interest‑earning assets 467 491 507 273 328 1,738 1,104
Total interest income 22,307 22,295 22,116 21,499 18,240 88,217 48,967
INTEREST EXPENSE
Interest on depos its 1,929 1,956 1,841 1,673 1,355 7,399 3,618
Interest on Federa l Home Loan Bank advances 234 133 147 44 7 558 290
Interest on federa l funds purchased and securi ties sold under
agreements to repurchase 38 37 87 67 10 229 79
Interest on long-term debt 828 815 832 810 841 3,285 858
Other – – – 38 79 38 78
Total interest expense 3,029 2,941 2,907 2,632 2,292 11,509 4,923
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 19,278 19,354 19,209 18,867 15,948 76,708 44,044
Provis ion for loan losses 2,208 463 777 368 7,623 3,816 8,035
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 17,070 18,891 18,432 18,499 8,325 72,892 36,009
NONINTEREST INCOME
Service charges 1,327 1,270 1,392 1,498 1,265 5,487 2,613
Gains on sa le of securi ties avai lable-for-sa le – – 11 33 – 44 10
Gains on sa le of other assets 238 71 31 48 103 388 189
Mortgage income 499 632 447 339 163 1,917 163
Trust income 350 361 386 314 192 1,411 192
Derivatives income 346 69 98 65 89 578 304
Bank owned l i fe insurance 395 424 398 393 365 1,610 2,159
SBA lending activi ties 599 959 1,204 880 904 3,642 2,910
TriNet lending activi ties 357 – 761 383 – 1,501 –
Gains on sa le of branches – – 3,885 – – 3,885 –
Other noninterest income 319 216 267 467 379 1,269 859
Total noninterest income 4,430 4,002 8,880 4,420 3,460 21,732 9,399
Year endedThree months ended
25
ACBI Historical Income Statements (continued)
Atlantic Capital Bancshares, Inc.
Consolidated Statements of I ome (unaudited)
(in thousands except share and per share data)
December
31, 2016
September
30, 2016
June 30, 2016
March 31,
2016
December 31,
2015
December 31,
2016
December 31,
2015
Year endedThree months ended
NONINTEREST EXPENSE
Salaries and employee benefi ts 11,269 10,059 10,420 10,555 9,661 42,303 24,098
Occupancy 995 1,235 1,274 1,100 907 4,604 2,170
Equipment and software 694 862 724 686 608 2,966 1,295
Profess ional services 968 442 760 748 1,020 2,918 1,610
Postage, printing and suppl ies 73 61 159 169 115 462 178
Communications and data process ing 1,064 617 694 916 555 3,291 1,541
Marketing and bus iness development 247 269 317 267 197 1,100 410
FDIC premiums 262 415 493 398 273 1,568 789
Merger and convers ion costs 204 579 1,210 749 7,172 2,742 9,154
Amortization of intangibles 495 520 668 762 526 2,445 526
NPA/ORE expense 666 39 55 104 70 864 70
Other noninterest expense 1,838 2,198 2,169 1,812 2,135 8,017 4,092
Total noninterest expense 18,775 17,296 18,943 18,266 23,239 73,280 45,933
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES 2,725 5,597 8,369 4,653 (11,454) 21,344 (525)
Provis ion for income taxes 1,116 1,889 3,222 1,722 (3,293) 7,949 794
NET INCOME (LOSS) $ 1,609 $ 3,708 $ 5,147 $ 2,931 $ (8,161) $ 13,395 $ (1,319)
Net income (loss ) per common share‑bas ic $ 0.06 $ 0.15 $ 0.21 $ 0.12 $ (0.40) $ 0.54 $ (0.09)
Net income (loss ) per common share‑di luted $ 0.06 $ 0.15 $ 0.20 $ 0.12 $ (0.40) $ 0.53 $ (0.09)
Weighted average shares - bas ic 25,027,304 24,891,822 24,644,755 24,485,900 20,494,895 24,763,522 15,283,437
Weighted average shares - di luted 25,407,728 25,260,280 25,158,694 24,993,597 21,004,577 25,186,680 15,663,865
26
ACBI Operating Income
ATLANTIC CAPITAL BANCSHARES, INC.
Selected Financial Information
(in thousands; taxable equivalent)
Fourth
Quarter
Third
Quarter
Second
Quarter First Quarter
Fourth
Quarter 2016 2015
INCOME SUMMARY
Interest income (1) 22,530$ 22,428$ 22,190$ 21,553$ 18,270$ 88,701$ 49,030$
Interest expense 3,029 2,941 2,907 2,632 2,292 11,509 4,923
Net interest income 19,501 19,487 19,283 18,921 15,978 77,192 44,107
Operating provis ion for loan losses (2) 2,208 463 777 368 859 3,816 1,271
Net interest income after provis ion for loan losses 17,293 19,024 18,506 18,553 15,119 73,376 42,836
Operating noninterest income 4,430 4,002 4,995 4,420 3,460 17,847 9,399
Operating noninterest expense (3) 18,571 16,717 17,428 17,517 16,067 70,233 36,779
Operating income before income taxes 3,152 6,309 6,073 5,456 2,512 20,990 15,456
Operating income tax expense 1,417 2,245 2,381 2,065 2,117 8,108 6,997
Operating net income (2)(3) 1,735 4,064 3,692 3,391 395 12,882 8,459
Provis ion for acquired non PCI FSG loans - - - - 4,153 - 4,153
Merger related expenses , net of income tax 126 356 743 460 4,403 1,685 5,625
Net ga in on sa le of branches , net of income tax - - 2,198 - - 2,198 -
Net income (loss) - GAAP 1,609$ 3,708$ 5,147$ 2,931$ (8,161)$ 13,395$ (1,319)$
For the year ended December
31, 2016 2015
(1) Interest income has been increased to reflect comparable interest on taxable securities. The rate used was 35%, reflecting the statutory
federal income tax rate. (2) Excludes provision for acquired non PCI FSG loans. (3) Excludes merger related expenses. This is a non-GAAP
financial measure. Please see “Non-GAAP Reconciliation” on slides 27 and 28 for more details.
Non-GAAP Reconciliation
27
ATLANTIC CAPITAL BANCSHARES, INC.
Non-GAAP Performance Measures Reconciliation
(in thousands, except per share data)
Fourth Quarter Third Quarter Second Quarter First Quarter Fourth Quarter 2016 2015
Interest income reconciliation
Interest income - GAAP $ 22,307 $ 22,295 $ 22,116 $ 21,499 $ 18,240 $ 88,217 $ 48,967
Taxable equiva lent adjustment 223 133 74 54 30 484 63
Interest income - taxable equiva lent $ 22,530 $ 22,428 $ 22,190 $ 21,553 $ 18,270 $ 88,701 $ 49,030
Net interest income reconciliation
Net interest income - GAAP $ 19,278 $ 19,354 $ 19,209 $ 18,867 $ 15,948 $ 76,708 $ 44,044
Taxable equiva lent adjustment 223 133 74 54 30 484 63
Net interest income - taxable equiva lent $ 19,501 $ 19,487 $ 19,283 $ 18,921 $ 15,978 $ 77,192 $ 44,107
Operating provision for loan losses reconciliation
Provis ion for loan losses - GAAP $ 2,208 $ 463 $ 777 $ 368 $ 7,623 $ 3,816 $ 8,035
Provis ion for acquired non PCI FSG loans - - - - (6,764) - (6,764)
Operating provis ion for loan losses $ 2,208 $ 463 $ 777 $ 368 $ 859 $ 3,816 $ 1,271
Operating noninterest income reconciliation
Noninterest income - GAAP $ 4,430 $ 4,002 $ 8,880 $ 4,420 $ 3,460 $ 21,732 $ 9,399
Gain on sa le of branches - - (3,885) - - (3,885) -
Operating noninterest income $ 4,430 $ 4,002 $ 4,995 $ 4,420 $ 3,460 $ 17,847 $ 9,399
Operating noninterest expense reconciliation
Noninterest expense - GAAP $ 18,775 $ 17,296 $ 18,943 $ 18,266 $ 23,239 $ 73,280 $ 45,933
Merger-related expenses (204) (579) (1,210) (749) (7,172) (2,742) (9,154)
Divesti ture expenses - - (305) - - (305) -
Operating noninterest expense $ 18,571 $ 16,717 $ 17,428 $ 17,517 $ 16,067 $ 70,233 $ 36,779
Operating income before income taxes reconciliation
Income (loss ) before income taxes - GAAP $ 2,725 $ 5,597 $ 8,369 $ 4,653 $ (11,454) $ 21,344 $ (525)
Taxable equiva lent adjustment 223 133 74 54 30 484 63
Merger-related expenses 204 579 1,210 749 7,172 2,742 9,154
Divesti ture expenses - - 305 - - 305 -
Ga in on sa le of branches - - (3,885) - - (3,885) -
Provis ion for acquired non PCI FSG loans - - - - 6,764 - 6,764
Operating income before income taxes $ 3,152 $ 6,309 $ 6,073 $ 5,456 $ 2,512 $ 20,990 $ 15,456
Income tax reconciliation
Income tax expense - GAAP $ 1,116 $ 1,889 $ 3,222 $ 1,722 $ (3,293) $ 7,949 $ 794
Taxable equiva lent adjustment 223 133 74 54 30 484 63
Merger related expenses , tax benefi t 78 223 467 289 2,769 1,057 3,529
Divesti ture expenses , tax benefi t - - 118 - - 118 -
Ga in on sa le of branches , tax expense - - (1,500) - - (1,500) -
Provis ion for acquired non PCI FSG loans , tax benefi t - - - - 2,611 - 2,611
Operating income tax expense $ 1,417 $ 2,245 $ 2,381 $ 2,065 $ 2,117 $ 8,108 $ 6,997
Net income reconciliation
Net income - GAAP $ 1,609 $ 3,708 $ 5,147 $ 2,931 $ (8,161) $ 13,395 $ (1,319)
Merger related expenses , net of income tax 126 356 743 460 4,403 1,685 5,625
Divesti ture expenses , net of income tax - - 187 - - 187 -
Ga in on sa le of branches , net of income tax - - (2,385) - - (2,385) -
Provis ion for acquired non PCI FSG loans , net of income tax - - - - 4,153 - 4,153
Operating net income $ 1,735 $ 4,064 $ 3,692 $ 3,391 $ 395 $ 12,882 $ 8,459
2016
2015
For the year ended December
31,
Non-GAAP Reconciliation (continued)
28
Diluted earnings per share reconciliation
Di luted earnings per share - GAAP $ 0.06 $ 0.15 $ 0.20 $ 0.12 $ (0.40) $ 0.53 $ (0.09)
Merger related expenses 0.01 0.01 0.03 0.02 0.42 0.06 0.63
Net ga in on sa le of branches - - (0.08) - - (0.08) -
Di luted earnings per share - operating $ 0.07 $ 0.16 $ 0.15 $ 0.14 $ 0.02 $ 0.51 $ 0.54
Return on average assets reconciliation
Net income - GAAP $ 1,609 $ 3,708 $ 5,147 $ 2,931 $ (8,161) $ 13,395 $ (1,319)
Merger related expenses , net of income tax 126 356 743 460 4,403 1,685 5,625
Divesti ture expenses , net of income tax - - 187 - - 187 -
Ga in on sa le of branches , net of income tax - - (2,385) - - (2,385) -
Provis ion for acquired FSG loans , net of income tax - - - - 4,153 - 4,153
Operating net income $ 1,735 $ 4,064 $ 3,692 $ 3,391 $ 395 $ 12,882 $ 8,459
Average assets 2,722,444 2,717,996 2,718,110 2,620,750 2,248,614 2,709,138 1,581,687
Return on average assets - GAAP 0.24% 0.55% 0.76% 0.45% -1.45% 0.49% -0.08%
Return on average assets
- operating 0.25% 0.60% 0.54% 0.52% 0.07% 0.48% 0.53%
Efficiency ratio reconciliation
Noninterest income - GAAP $ 4,430 $ 4,002 $ 8,880 $ 4,420 $ 3,460 $ 21,732 $ 9,399
Gain on sa le of branches - - (3,885) - - (3,885) -
Operating noninterest income $ 4,430 $ 4,002 $ 4,995 $ 4,420 $ 3,460 $ 17,847 $ 9,399
Noninterest expense - GAAP $ 18,775 $ 17,296 $ 18,943 $ 18,266 $ 23,239 $ 73,280 $ 45,933
Merger-related expenses (204) (579) (1,210) (749) (7,172) (2,742) (9,154)
Divesti ture expenses - - (305) - - (305) -
Operating noninterest expense $ 18,571 $ 16,717 $ 17,428 $ 17,517 $ 16,067 $ 70,233 $ 36,779
Net interest income 19,278 19,354 19,209 18,867 15,948 76,708 44,044
Efficiency ratio 78.33% 71.57% 72.00% 75.22% 82.79% 74.28% 68.82%
Tangible common equity to tangible assets reconciliation
Total shareholders ’ equity $ 303,658 $ 308,463 $ 304,066 $ 294,652 $ 287,992 $ 303,658 $ 287,992
Intangible assets (29,567) (30,071) (31,674) (33,914) (35,232) (29,567) (35,232)
Tota l tangible common equity $ 274,091 $ 278,392 $ 272,392 $ 260,738 $ 252,760 $ 274,091 $ 252,760
Tota l assets $ 2,727,543 $ 2,761,244 $ 2,807,822 $ 2,724,669 $ 2,638,780 $ 2,727,543 $ 2,638,780
Intangible assets (29,567) (30,071) (31,674) (33,914) (35,232) (29,567) (35,232)
Tota l tangible assets $ 2,697,976 $ 2,731,173 $ 2,776,148 $ 2,690,755 $ 2,603,548 $ 2,697,976 $ 2,603,548
Tangible common equity to tangible assets 10.16% 10.19% 9.81% 9.69% 9.71% 10.16% 9.71%
Deposits excluding deposits to be assumed in branch sales
Total depos i ts $ 2,237,580 $ 2,188,856 $ 2,158,305 $ 2,282,462 $ 2,262,218 $ 2,237,580 $ 2,262,218
Depos i ts to be assumed in branch sa les 31,589 - - 197,857 213,410 31,589 213,410
Depos i ts excluding depos i ts to be assumed in branch
sa les $ 2,205,991 $ 2,188,856 $ 2,158,305 $ 2,084,605 $ 2,048,808 $ 2,205,991 $ 2,048,808
ATLANTIC CAPITAL BANCSHARES, INC.
Non-GAAP Performance Measures Reconciliation
(in thousands, except per share data)
Fourth Quarter Third Quarter Second Quarter First Quarter Fourth Quarter 2016 2015
2016
2015
For the year ended December
31,
