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Exhibit 99.1

 

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CADENCE BANCORPORATION REPORTS

FIRST QUARTER 2017 RESULTS

HOUSTON, TEXAS (May 8, 2017) – Cadence Bancorporation (NYSE:CADE) (“Cadence”) today reported first quarter 2017 results.

 

    Net income for the first quarter of 2017 was $26.1 million compared to $15.3 million in the first quarter of 2016, representing a 70.2% increase.

 

    On a per-share basis, net income was $0.35 per diluted common share for the first quarter of 2017, compared to $0.20 in the first quarter a year earlier.

 

    Annualized returns on average assets, common equity and tangible common equity(1) for the first quarter of 2017 were 1.10%, 9.71% and 13.96%, respectively, as compared to 0.69%, 5.77% and 8.44%, respectively, for the first quarter of 2016.

 

    Net interest margin increased 14 basis points during the first quarter of 2017 to 3.46% from 3.32% for the first quarter of 2016.

 

    Total assets were $9.7 billion at March 31, 2017, an increase of $719.5 million or 8.0% as compared to $9.0 billion as of March 31, 2016.

 

    Loans were $7.6 billion at March 31, 2017, an increase of $677.1 million, up 9.8% as compared to $6.9 billion at March 31, 2016.

“We are very pleased to report our first quarter earnings, our first as a public company following our initial public offering and listing on the New York Stock Exchange on April 13, 2017. We believe Cadence is entering an exciting chapter, and we are pleased to be introducing new investors to our company. We experienced solid results with revenues and margin increasing, expenses down and credit stable. While Federal Reserve data has shown recent industry declines in C&I loan growth, our loan growth continued in C&I and throughout our other key business lines. It was a good quarter.” said Paul Murphy, Cadence’s Chairman and Chief Executive Officer.

Period End Balance Sheet:

Cadence continued solid growth, completing the first quarter of 2017 with total assets of $9.7 billion, an increase of $719.5 million or 8.0% from March 31, 2016 total assets of $9.0 billion, and an increase of $190.0 million or 2.0% from December 31, 2016 total assets of $9.5 billion.

Loans excluding held-for-sale at March 31, 2017 were $7.6 billion, an increase of $677.1 million or 9.8%, compared with $6.9 billion at March 31, 2016, reflecting growth in our commercial and residential loan portfolios. Linked quarter loans increased $128.8 million or 1.7% from $7.4 billion at December 31, 2016, reflecting seasonal first quarter softness as well as growth in restaurant franchise and residential loans offset by paydowns in energy. Cadence’s energy lending portfolio totaled $903.9 million or 11.9% of total loans at March 31, 2017, as compared to $939.4 million or 12.6% of total loans at December 31, 2016. At March 31, 2017, midstream made up the largest component of energy loans at 52.0%, followed by exploration and production at 37.6% and energy services at 10.5%.

 

(1)  Considered a non-GAAP financial measure. See Table 6 “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.


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Total deposits at March 31, 2017 were $7.8 billion, an increase of $473.0 million or 6.4%, compared with $7.4 billion at March 31, 2016, primarily a result of expansion of commercial deposit relationships and treasury management services. Linked quarter deposits decreased $175.0 million or 2.2% from $8.0 billion at December 31, 2016, due primarily to seasonal flows, reflecting an increase in noninterest bearing deposits offset by declines in higher cost money market and time deposits.

Results of Operations for the Quarter:

Net income for the first quarter of 2017 was $26.1 million compared to $15.3 million in the first quarter of 2016, and $29.0 million for the fourth quarter of 2016. The year-over-year net income improvement was driven by continued asset and revenue growth, margin improvement, flat expenses and improved credit costs. The decline in net income on a linked quarter basis was due primarily to a provision for credit loss recovery in the fourth quarter of 2016 versus a provision expense in the first quarter of 2017. Pre-tax, pre-provision net earnings(1) were $44.5 million for the first quarter of 2017 as compared to $39.5 million in the fourth quarter of 2016. On a per-share basis, net income was $0.35 per diluted common share for the first quarter of 2017, compared to $0.20 a year earlier and $0.38 for the linked quarter. The first quarter of 2017 annualized returns on average assets, common equity and tangible common equity(1) were 1.10%, 9.71% and 13.96%, respectively, as compared to 0.69%, 5.77% and 8.44%, respectively, for the first quarter of 2016, and 1.20%, 10.54% and 15.16% for the fourth quarter of 2016.

Net interest margin for the first quarter of 2017 was 3.46% as compared to 3.32% for the first quarter of 2016 and 3.31% for the fourth quarter of 2016. This increase resulted from deposit costs lagging earning asset increases from rate increases during the period. Total cost of deposits for the first quarter of 2017 was 49 basis points versus 45 basis points in the prior year’s quarter, while yield on earning assets increased to 4.13% for the first quarter of 2017 versus 3.97% for the first quarter of 2016.

Net interest income for the first quarter of 2017 was $74.8 million as compared to $67.3 million during the same period in 2016, an increase of $7.5 million or 11.1%. This increase was due to increased yield and volume of our originated loan portfolio. Driven by the same dynamics, linked quarter net interest income increased $2.3 million or 3.1% from $72.5 million in the fourth quarter of 2016.

Noninterest income for the first quarter of 2017 was $24.1 million as compared to $20.1 million during the same period in 2016, an increase of $4.0 million or 19.7%. This increase was due to increases in trust services revenue, service charges on deposit accounts and changes in other asset valuations. Linked quarter noninterest income increased $1.7 million or 7.8% from $22.4 million for the fourth quarter of 2016, driven by increases in trust services, insurance revenue and changes in other asset valuations, offset by lower securities gains in the first quarter of 2017.

Noninterest expense for the first quarter of 2017 was $54.3 million as compared to $54.0 million during the same period in 2016, an increase of $0.3 million or 0.5%. Personnel expenses, the largest component of noninterest expense, increased to $34.3 million, or 4.4% in the first quarter of 2017 compared to the first quarter of 2016. Salary expense remained level, however other personnel expenses increased primarily due to short and long term incentive costs. These costs were offset by lower intangible asset

 

(1)  Considered a non-GAAP financial measure. See Table 6 “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.


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amortization and other expenses as a result of targeted expense management efforts. Linked quarter noninterest expenses declined $1.1 million or 1.9% from $55.4 million for the fourth quarter of 2016, reflecting broad based expense management offset by increased personnel costs that typically are higher in the first quarter of each year due to payroll taxes and annual bonus 401(k) match expense, combined with the impact of approximately $2.5 million of incentive and long term compensation accrual reversals in the fourth quarter of 2016.

The efficiency ratio(1) for the first quarter of 2017 was 55.0%, an improvement from both the first and fourth quarters of 2016 of 61.8% and 58.4%, respectively, reflecting ongoing focus on efficiency and historically lower first quarter miscellaneous expenses.

Asset Quality:

Nonperforming assets totaled $171.0 million at March 31, 2017, increasing from $166.2 million at December 31, 2016, and down from $218.2 million at March 31, 2016. The decline as compared to the prior year is due primarily to resolutions and paydowns of energy credits. At March 31, 2017, $135.2 million or 79.1% of the nonperforming assets (NPAs) related to the energy portfolio. Additionally, of the $118.6 million in energy nonperforming loans included in total nonperforming assets, over 90% were paying in accordance with contractual terms as of March 31, 2017.

The allowance for credit losses (ACL) was $88.3 million or 1.2 % of total loans at March 31, 2017, as compared to $90.8 million or 1.3 % of total loans at March 31, 2016 and $82.3 million or 1.1% of total loans at December 31, 2016. At March 31, 2017, the allowance included reserves for the energy portfolio as follows: midstream of 1.2%, exploration and production of 5.7% and energy services of 6.4%. This compares to the December 31, 2016 energy portfolio reserve ratios of 1.3% for midstream, 3.5% for exploration and production and 5.9% for energy services.

The provision for credit losses was $5.8 million for the first quarter of 2017, compared with $10.5 million for the first quarter of 2016 and a net provision reversal of $5.2 million for the fourth quarter of 2016.

Net recoveries were $250 thousand for the first quarter of 2017, compared with net recoveries of $496 thousand for the first quarter of 2016 and net charge-offs of $3.7 million for the fourth quarter of 2016.

“As noted earlier, we are pleased with our first quarter performance. We are proud of our hard-working bankers and our focus on customer service. We look forward to sharing our performance with you as we move ahead,” stated Mr. Murphy.

 

(1)  Considered a non-GAAP financial measure. See Table 6 “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.


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First Quarter 2017 Earnings Conference Call:

Cadence Bancorporation executive management will host a conference call to discuss first quarter 2017 results on Monday, May 8, 2017, at 1:00 p.m. CT / 2:00 p.m. ET.

Conference Call Access:

To access the conference call, please dial one of the following numbers approximately 10-15 minutes prior to the start time to allow time for registration, and use the Elite Entry Number provided below.

 

Dial in (toll free):    1-888-317-6003
International dial in:    1-412-317-6061
Canada (toll free):    1-866-284-3684
Participant Elite Entry Number:    1388393

For those unable to participate in the live presentation, a replay will be available through May 22, 2017. To access the replay, please use the following numbers:

 

US Toll Free:    1-877-344-7529
International Toll:    1-412-317-0088
Canada Toll Free:    1-855-669-9658
Replay Access Code:    10106518
End Date:    May 22, 2017

Webcast Access:

A webcast of the conference call as well as the slides to be presented by management can be viewed by visiting www.cadencebank.com, clicking through the following links: “Investor Relations”, “Events & Presentations” and “Event Calendar”.

About Cadence Bancorporation

Cadence Bancorporation (NYSE:CADE) is a $9.7 billion in assets regional bank holding company headquartered in Houston, Texas. Through its affiliates, Cadence operates 65 locations in Alabama, Florida, Mississippi, Tennessee and Texas, and provides corporations, middle-market companies, small businesses and consumers with a full range of innovative banking and financial solutions. Services and products include commercial and business banking, treasury management, specialized lending, commercial real estate, foreign exchange, wealth management, investment and trust services, financial planning, retirement plan management, business and personal insurance, consumer banking, consumer loans, mortgages, home equity lines and loans, and credit cards. Clients have access to leading-edge online and mobile solutions, interactive teller machines, and 55,000 ATMs. The Cadence team of 1,200 associates is committed to exceeding customer expectations and helping their clients succeed financially. Cadence Bank, N.A., Cadence Insurance, and Linscomb & Williams are direct or indirect subsidiaries of Cadence Bancorporation.


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Cautionary Statement Regarding Forward-Looking Information

This communication contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our results of operations, financial condition and 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 words 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. Such factors include, without limitation, the “Risk Factors” referenced in our Registration Statement on Form S-1 filed with the Securities and Exchange Commission (SEC), other risks and uncertainties listed from time to time in our reports and documents filed with the SEC, including our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, and the following factors: business and economic conditions generally and in the financial services industry, nationally and within our current and future geographic market areas; economic, market, operational, liquidity, credit and interest rate risks associated with our business; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; the laws and regulations applicable to our business; our ability to achieve organic loan and deposit growth and the composition of such growth; increased competition in the financial services industry, nationally, regionally or locally; our ability to maintain our historical earnings trends; our ability to raise additional capital to implement our business plan; material weaknesses in our internal control over financial reporting; systems failures or interruptions involving our information technology and telecommunications systems or third-party servicers; the composition of our management team and our ability to attract and retain key personnel; the fiscal position of the U.S. federal government and the soundness of other financial institutions; the composition of our loan portfolio, including the identify of our borrowers and the concentration of loans in energy-related industries and in our specialized industries; the portion of our loan portfolio that is comprised of participations and shared national credits; and the amount of nonperforming and classified assets we hold. Cadence can give no assurance that any goal or plan or expectation set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements. The forward-looking statements are made as of the date of this communication, and Cadence does not intend, and assumes no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law.

About Non-GAAP Financial Measures

Certain of the financial measures and ratios we present, including “efficiency ratio,” “adjusted noninterest expenses,” “adjusted operating revenue,” “tangible common equity ratio,” “tangible book value per share” and “return on average tangible common equity” and “pre-tax, pre-provision net earnings,” are supplemental measures that are not required by, or are not presented in accordance with, U.S. generally


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accepted accounting principles (GAAP). We refer to these financial measures and ratios as “non-GAAP financial measures.” We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision making and useful in evaluating period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenditures or assets that we believe are not indicative of our primary business operating results or by presenting certain metrics on a fully taxable equivalent basis. We believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing and comparing past, present and future periods.

These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and you should not rely on non-GAAP financial measures alone as measures of our performance. The non-GAAP financial measures we present may differ from non-GAAP financial measures used by our peers or other companies. We compensate for these limitations by providing the equivalent GAAP measures whenever we present the non-GAAP financial measures and by including a reconciliation of the impact of the components adjusted for in the non-GAAP financial measure so that both measures and the individual components may be considered when analyzing our performance.

A reconciliation of non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables (Table 6).

###

 

Contact Information  
Media contact:   Investor relations contact:
Danielle Kernell   Valerie Toalson
713-871-4051   713-871-4103 or 800-698-7878
danielle.kernell@cadencebank.com   vtoalson@cadencebancorporation.com


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Table 1 - Selected Financial Data

 

     As of and for the three months ended  
     March 31,
2017
     December 31,
2016
    September 30,
2016
     June 30,
2016
     March 31,
2016
 

(dollars in thousands, except share data)

             

Statement of Operations Data:

             

Interest income

   $ 89,619      $ 87,068     $ 84,654      $ 82,921      $ 80,607  

Interest expense

     14,861        14,570       14,228        13,672        13,341  
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Net interest income

     74,758        72,498       70,426        69,249        67,266  

Provision for credit losses

     5,786        (5,222     29,627        14,471        10,472  
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Net interest income after provision

     68,972        77,720       40,799        54,778        56,794  

Noninterest income - service fees and revenue

     22,489        20,605       20,878        20,048        20,489  

                              - other noninterest income

     1,616        1,755       1,913        3,058        (343

Noninterest expense

     54,321        55,394       54,876        55,868        54,042  
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Income before income taxes

     38,756        44,686       8,714        22,016        22,898  

Income tax expense

     12,639        15,701       2,107        7,175        7,557  
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Net income

   $ 26,117      $ 28,985     $ 6,607      $ 14,841      $ 15,341  
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Period-End Balance Sheet Data:

             

Investment securities, available-for-sale

   $ 1,116,280      $ 1,139,347     $ 1,031,319      $ 980,526      $ 1,033,341  

Total loans, net of unearned income

     7,561,472        7,432,712       7,207,313        7,162,027        6,884,399  

Allowance for credit losses

     88,304        82,268       91,169        87,147        90,751  

Total assets

     9,720,937        9,530,888       9,444,010        9,221,807        9,001,483  

Total deposits

     7,841,710        8,016,749       7,917,289        7,672,657        7,368,748  

Non-interest-bearing deposits

     1,871,514        1,840,955       1,642,480        1,668,179        1,565,738  

Interest-bearing deposits

     5,970,196        6,175,794       6,274,809        6,004,478        5,803,010  

Borrowings and subordinated debentures

     682,567        331,712       332,787        334,192        482,622  

Total shareholders’ equity

     1,105,976        1,080,498       1,111,783        1,116,076        1,086,008  

Average Balance Sheet Data:

             

Investment securities, available-for-sale

   $ 1,125,174      $ 1,060,821     $ 1,110,836        977,597      $ 854,154  

Total loans, net of unearned income

     7,551,173        7,375,446       7,225,365        7,180,357        6,962,358  

Allowance for credit losses

     82,258        95,042       93,132        91,211        81,587  

Total assets

     9,670,593        9,596,574       9,400,145        9,167,153        8,917,662  

Total deposits

     8,025,068        8,425,326       7,843,582        7,496,120        7,781,267  

Non-interest-bearing deposits

     1,857,657        1,784,422       1,697,633        1,655,761        6,166,618  

Interest-bearing deposits

     6,167,411        6,640,904       6,145,949        5,840,359        1,614,649  

Borrowings and subordinated debentures

     474,976        500,045       368,192        512,837        430,074  

Total shareholders’ equity

     1,090,905        1,094,182       1,118,603        1,092,034        1,069,314  


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Table 1 (Continued) - Selected Financial Data

 

 
     As of and for the three months ended  
     March 31,
2017
    December 31,
2016
    September 30,
2016
    June 30,
2016
    March 31,
2016
 

(dollars in thousands, except per share data)

      

Per Share Data:(3)

          

Earnings

          

Basic

   $ 0.35     $ 0.39     $ 0.09     $ 0.20     $ 0.20  

Diluted

     0.35       0.38       0.09       0.20       0.20  

Book value per common share

     14.75       14.41       14.82       14.88       14.48  

Tangible book value (1)

     10.33       9.97       10.37       10.40       9.98  

Weighted average common shares outstanding

          

Basic

     75,000,000       75,000,000       75,000,000       75,000,000       75,000,000  

Diluted

     75,672,750       75,402,525       75,258,375       75,258,375       75,258,375  

Performance Ratios:

          

Return on average common equity (2)

     9.71     10.54     2.35     5.47     5.77

Return on average equity (2)

     9.71       10.54       2.35       5.47       5.77  

Return on average tangible common equity (1) (2)

     13.96       15.16       3.36       7.90       8.44  

Return on average assets (2)

     1.10       1.20       0.28       0.65       0.69  

Net interest margin (2)

     3.46       3.31       3.27       3.32       3.32  

Efficiency ratio (1)

     54.95       58.40       58.87       60.49       61.82  

Asset Quality Ratios:

          

Total nonperforming assets (‘NPAs”) to total loans and OREO and other NPAs

     2.25     2.22     2.52     2.72     3.15

Total nonperforming loans to total loans

     1.77       1.73       2.13       2.26       2.64  

Total ACL to total loans

     1.17       1.11       1.26       1.22       1.32  

ACL to total nonperforming loans (“NPLs”)

     65.80       63.80       59.34       53.84       49.88  

Net charge-offs to average loans (2)

     (0.01     0.20       1.41       1.01       (0.03

Capital Ratios:

          

Total shareholders’ equity to assets

     11.38     11.34     11.77     12.10     12.06

Tangible common equity to tangible assets (1)

     8.25       8.13       8.54       8.78       8.64  

Common equity tier 1 (CET1) (transitional)

     8.99       8.84       8.82       8.69       8.60  

Tier 1 leverage capital

     9.10       8.89       8.73       8.90       8.90  

Tier 1 risk-based capital

     9.36       9.19       9.17       9.00       8.93  

Total risk-based capital

     11.43       11.22       11.38       11.10       11.16  

 

(1) - Considered a non-GAAP financial measure. See “Non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.
(2) - Annualized.
(3) - All outstanding shares are owned by our parent-holding company Cadence Bancorp LLC


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Table 2 - Average Balances/Yield/Rates

 

     Three Months Ended March 31,  
     2017     2016  
     Average
Balance
    Income/
Expense
    Yield/
Rate
    Average
Balance
    Income/
Expense
    Yield/
Rate
 
     (Dollars in thousands)  

ASSETS

            

Interest-earning assets:

            

Loans, net of unearned income(1)

            

Originated and ANCI loans

   $ 7,234,671     $ 73,869       4.14   $ 6,543,758     $ 62,892       3.87

ACI portfolio

     316,502       6,941       8.89       418,600       10,869       10.44  
  

 

 

   

 

 

     

 

 

   

 

 

   

Total loans

     7,551,173       80,810       4.34       6,962,358       73,761       4.26  

Investment securities

            

Taxable

     722,465       4,301       2.41       698,165       4,385       2.53  

Tax-exempt (2)

     402,709       5,252       5.29       155,989       1,977       5.10  
  

 

 

   

 

 

     

 

 

   

 

 

   

Total investment securities

     1,125,174       9,553       3.44       854,154       6,362       3.00  

Federal funds sold and short-term investments

     264,355       425       0.65       380,189       481       0.51  

Other investmnents

     48,047       669       5.65       44,861       695       6.23  
  

 

 

   

 

 

     

 

 

   

 

 

   

Total interest-earning assets

     8,988,749       91,457       4.13       8,241,562       81,299       3.97  

Noninterest-earning assets:

            

Cash and due from banks

     53,450           49,403      

Premises and equipment

     66,298           70,404      

Accrued interest and other assets

     644,354           637,880      

Allowance for credit losses

     (82,258         (81,587    
  

 

 

       

 

 

     

Total assets

   $ 9,670,593         $ 8,917,662      
  

 

 

       

 

 

     

LIABILITIES AND STOCKHOLDERS’ EQUITY

            

Interest-bearing liabilities:

            

Demand deposits

   $ 4,455,742     $ 5,531       0.50   $ 4,038,943     $ 4,278       0.43

Savings deposits

     182,247       112       0.25       174,933       97       0.22  

Time deposits

     1,529,422       4,122       1.09       1,522,668       3,831       1.01  
  

 

 

   

 

 

     

 

 

   

 

 

   

Total interest-bearing deposits

     6,167,411       9,765       0.64       5,736,544       8,206       0.58  

Other borrowings

     340,470       2,802       3.34       296,367       2,849       3.87  

Subordinated debentures

     134,506       2,294       6.92       133,707       2,286       6.88  
  

 

 

   

 

 

     

 

 

   

 

 

   

Total interest-bearing liabilities

     6,642,387       14,861       0.91       6,166,618       13,341       0.87  

Noninterest-bearing liabilities:

            

Demand deposits

     1,857,657           1,614,649      

Accrued interest and other liabilities

     79,644           67,081      
  

 

 

       

 

 

     

Total liabilities

     8,579,688           7,848,348      

Stockholders’ equity

     1,090,905           1,069,314      
  

 

 

       

 

 

     

Total liabilities and stockholders’ equity

   $ 9,670,593         $ 8,917,662      
  

 

 

       

 

 

     

Net interest income/net interest spread

       76,596       3.22       67,958       3.10
      

 

 

       

 

 

 

Net yield on earning assets/net interest margin

         3.46         3.32
      

 

 

       

 

 

 

Taxable equivalent adjustment:

            

Investment securities

       (1,838         (692  
    

 

 

       

 

 

   

Net interest income

     $ 74,758         $ 67,266    
    

 

 

       

 

 

   

 

 

(1) Nonaccrual loans are included in loans, net of unearned income. No adjustment has been made for these loans in the calculation of yields.
(2) Interest income and yields are presented on a fully taxable equivalent basis using a tax rate of 35%.


LOGO

 

Table 3 - Allowance for Credit Losses

 

     Three Months Ended  
     March 31,
2017
     December 31,
2016
    September 30,
2016
    June 30,
2016
    March 31,
2016
 
     (Dollars in thousands)  

Balance at beginning of period

   $ 82,268      $ 91,169     $ 87,147     $ 90,751     $ 79,783  

Net recoveries (charge-offs)

     250        (3,679     (25,605     (18,075     496  

Provision (reversal of) for credit losses

     5,786        (5,222     29,627       14,471       10,472  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Balance at end of period

   $ 88,304      $ 82,268     $ 91,169     $ 87,147     $ 90,751  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Table 4 -Noninterest Income

 

     Three Months Ended  
     March 31,
2017
     December 31,
2016
     September 30,
2016
     June 30,
2016
     March 31,
2016
 
     (Dollars in thousands)  

Noninterest Income

  

Investment advisory revenue

   $ 4,916      $ 4,821      $ 4,733      $ 4,653      $ 4,604  

Trust services revenue

     5,231        4,109        3,959        3,971        4,070  

Service charges on deposit accounts

     3,815        3,614        3,555        3,270        3,354  

Credit-related fees

     2,747        2,875        2,689        2,507        2,674  

Insurance revenue

     2,130        1,577        1,863        1,953        2,324  

Bankcard fees

     1,812        1,813        1,823        1,777        1,729  

Mortgage banking revenue

     866        1,019        1,459        1,101        1,084  

Other service fees earned

     972        777        797        816        650  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total service fees and revenue

     22,489        20,605        20,878        20,048        20,489  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Securities gains, net

     81        1,267        1,386        1,019        64  

Other

     1,535        488        527        2,039        (407
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total other noninterest income

     1,616        1,755        1,913        3,058        (343
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total noninterest income

   $ 24,105      $ 22,360      $ 22,791      $ 23,106      $ 20,146  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Table 5 -Noninterest Expenses

 

     Three Months Ended  
     March 31,
2017
     December 31,
2016
     September 30,
2016
     June 30,
2016
     March 31,
2016
 

Noninterest Expenses

              

Salaries and employee benefits

   $ 34,267      $ 28,139      $ 31,086      $ 33,033      $ 32,810  

Premises and equipment

     6,693        7,475        7,130        6,626        6,751  

Intangible asset amortization

     1,241        1,555        1,607        1,659        1,711  

Net cost of operation of other real estate owned

     296        1,117        1,126        107        684  

Data processing

     1,696        1,767        1,530        1,594        1,389  

Special asset expenses

     140        670        477        392        (40

Consulting and professional fees

     1,139        2,288        2,040        1,092        1,309  

Loan related expenses

     280        1,236        985        744        437  

FDIC insurance

     1,493        1,517        1,912        2,292        1,506  

Communications

     655        741        535        721        658  

Advertising and public relations

     345        344        303        338        383  

Legal expenses

     432        662        337        978        744  

Branch closure expenses

     46        47        52        75        64  

Other

     5,598        7,836        5,756        6,217        5,636  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total noninterest expenses

   $ 54,321      $ 55,394      $ 54,876      $ 55,868      $ 54,042  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 


LOGO

 

Table 6 - Reconciliation of Non-GAAP Financial Measures

 

     As of and for the three months ended  
     March 31,
2017
    December 31,
2016
    September 30,
2016
    June 30,
2016
    March 31,
2016
 
     (In thousands)  

Efficiency ratio

          

Noninterest expenses (numerator)

   $ 54,321     $ 55,394     $ 54,876     $ 55,868     $ 54,042  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest income

   $ 74,758     $ 72,498     $ 70,426     $ 69,249     $ 67,266  

Noninterest income

     24,105       22,360       22,791       23,106       20,146  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating revenue (denominator)

   $ 98,863     $ 94,858     $ 93,217     $ 92,355     $ 87,412  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Efficiency ratio

     54.95     58.40     58.87     60.49     61.82
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted noninterest expenses and operating revenue

          

Noninterest expense

   $ 54,321     $ 55,394     $ 54,876     $ 55,868     $ 54,042  

Less: Branch closure expenses

     46       47       52       75       64  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted noninterest expenses

   $ 54,275     $ 55,347     $ 54,824     $ 55,793     $ 53,978  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest income

   $ 74,758     $ 72,498     $ 70,426     $ 69,249     $ 67,266  

Noninterest income

     24,105       22,360       22,791       23,106       20,146  

Less: Securities gains, net

     81       1,267       1,386       1,019       64  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted operating revenue

   $ 98,782     $ 93,591     $ 91,831     $ 91,336     $ 87,348  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Tangible common equity ratio

          

Shareholders’ equity

   $ 1,105,976     $ 1,080,498     $ 1,111,783     $ 1,116,076     $ 1,086,008  

Less: Goodwill and other intangible assets, net

     (331,450     (332,691     (334,246     (335,852     (337,512
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Tangible common shareholders’ equity

     774,526       747,807       777,537       780,224       748,496  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

     9,720,937       9,530,888       9,444,010       9,221,807       9,001,483  

Less: Goodwill and other intangible assets, net

     (331,450     (332,691     (334,246     (335,852     (337,512
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Tangible assets

   $ 9,389,487     $ 9,198,197     $ 9,109,764     $ 8,885,955     $ 8,663,971  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Tangible common equity ratio

     8.25     8.13     8.54     8.78     8.64
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Tangible book value per share

          

Shareholders’ equity

   $ 1,105,976     $ 1,080,498     $ 1,111,783     $ 1,116,076     $ 1,086,008  

Less: Goodwill and other intangible assets, net

     (331,450     (332,691     (334,246     (335,852     (337,512
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Tangible common shareholders’ equity

   $ 774,526     $ 747,807     $ 777,537     $ 780,224     $ 748,496  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Common shares issued

     75,000,000       75,000,000       75,000,000       75,000,000       75,000,000  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Tangible book value per share

   $ 10.33     $ 9.97     $ 10.37     $ 10.40     $ 9.98  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Return on average tangible common equity

          

Average common equity

   $ 1,090,905     $ 1,094,182     $ 1,118,603     $ 1,092,034     $ 1,069,314  

Less: Average intangible assets

     (332,199     (333,640     (335,215     (336,856     (338,542
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Average tangible common shareholders’ equity

   $ 758,706     $ 760,542     $ 783,388     $ 755,178     $ 730,772  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 26,117     $ 28,985     $ 6,607     $ 14,841     $ 15,341  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Return on average tangible common equity

     13.96     15.16     3.36     7.90     8.44
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Pre-tax, pre-provision net earnings

          

Income before taxes

   $ 38,756     $ 44,686     $ 8,714     $ 22,016     $ 22,898  

Plus: Provision for credit losses

     5,786       (5,222     29,627       14,471       10,472  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Pre-tax, pre-provision net earnings

   $ 44,542     $ 39,464     $ 38,341     $ 36,487     $ 33,370