MB FINANCIAL, INC. | ||||
(Exact name of registrant as specified in its charter) | ||||
Maryland | 001-36599 | 36-4460265 | ||
(State or other jurisdiction of incorporation) | (Commission File No.) | (IRS Employer Identification No.) | ||
800 West Madison Street, Chicago, Illinois 60607 | ||||
(Address of principal executive offices) (Zip Code) | ||||
Registrant’s telephone number, including area code: (888) 422-6562 | ||||
N/A | ||||
(Former name or former address, if changed since last report) | ||||
MB FINANCIAL, INC. | ||||
Date: | April 27, 2017 | By: | /s/Randall T. Conte | |
Randall T. Conte | ||||
Vice President and Chief Financial Officer | ||||
(Principal Financial Officer) |
99 | MB Financial Inc.’s April 27, 2017 release containing its first quarter 2017 results of operations. |
![]() | 1Q17 |
Operating Earnings (in thousands, except per share data) |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Net income - as reported | $ | 54,537 | $ | 47,191 | $ | 44,419 | $ | 43,412 | $ | 39,114 | ||||||||||
Non-core items, net of tax (1) | (1,358 | ) | 4,656 | 7,496 | 1,451 | 2,758 | ||||||||||||||
Operating earnings | 53,179 | 51,847 | 51,915 | 44,863 | 41,872 | |||||||||||||||
Dividends on preferred shares | 2,003 | 2,005 | 2,004 | 2,000 | 2,000 | |||||||||||||||
Operating earnings available to common stockholders | $ | 51,176 | $ | 49,842 | $ | 49,911 | $ | 42,863 | $ | 39,872 | ||||||||||
Diluted earnings per common share - as reported | $ | 0.62 | $ | 0.53 | $ | 0.54 | $ | 0.56 | $ | 0.50 | ||||||||||
Diluted operating earnings per common share | $ | 0.60 | $ | 0.59 | $ | 0.63 | $ | 0.58 | $ | 0.54 |
(1) | Non-core items represent the difference between non-core non-interest income and non-core non-interest expense net of tax. |
Key Items (compared to 4Q16) |
• | Operating earnings increased 2.6% (+10.4% annualized) to $53.2 million compared to $51.8 million in the prior quarter. |
• | Diluted operating earnings per common share were $0.60 compared to $0.59 in the prior quarter. |
• | Loans increased by $189.7 million (+1.5%, or +6.0% annualized) to $13.0 billion led by growth in residential real estate loans. |
• | Average yield on loans, excluding accretion on loans acquired in bank mergers, increased to 4.01% from 3.92% in the prior quarter. |
• | Low cost deposits decreased by $168.3 million in the quarter (-1.4%, or -5.6% annualized) to $11.9 billion due to a decrease in mortgage escrow account balances, sale of our Philadelphia branch and seasonal deposit declines. |
• | Average cost of deposits (interest bearing and non-interest bearing deposits) increased one basis point to 0.22%. |
• | Net interest margin on a fully tax equivalent basis, excluding accretion on loans acquired in bank mergers, increased by eight basis points to 3.55% from the prior quarter due to the impact of the December interest rate increase on loans and a favorable shift in the mix of interest earning assets partly offset by a higher average cost of borrowings and an unfavorable shift in liabilities (a higher percentage of borrowings). |
• | Average interest earning assets decreased by $246.5 million mostly due to the decrease in loans held for sale and taxable investment securities. |
• | Average cost of funds increased five basis points to 0.33%. |
Operating Segments (compared to 4Q16) |
• | Operating earnings were $45.6 million compared to $43.8 million in the prior quarter. |
• | Operating earnings for the quarter were positively impacted by $2.7 million of tax benefit recorded on stock-based compensation during the quarter compared to $849 thousand in the prior quarter, an increase of $1.9 million. |
• | Operating earnings were $5.9 million compared to $6.8 million in the prior quarter. |
• | Prior quarter was positively impacted by a $1.8 million negative provision for credit losses due to improvement of a potential problem loan. |
• | Operating earnings were $1.7 million compared to $1.2 million in the prior quarter. |
• | The increase in operating earnings was the result of higher mortgage servicing revenue and lower non-interest expense partly offset by a decline in mortgage origination revenue. |
Operating Segments |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | |||||||||||||||
Net interest income | $ | 131,449 | $ | 133,688 | $ | 119,685 | $ | 112,152 | $ | 109,608 | |||||||||
Provision for credit losses | 3,527 | 4,193 | 4,394 | 2,995 | 7,001 | ||||||||||||||
Net interest income after provision for credit losses | 127,922 | 129,495 | 115,291 | 109,157 | 102,607 | ||||||||||||||
Non-interest income: | |||||||||||||||||||
Lease financing revenue, net | 1,545 | 1,050 | 890 | 789 | 679 | ||||||||||||||
Commercial deposit and treasury management fees | 14,689 | 14,237 | 12,957 | 11,548 | 11,878 | ||||||||||||||
Trust and asset management fees | 8,520 | 8,442 | 8,244 | 8,236 | 7,950 | ||||||||||||||
Card fees | 4,566 | 4,340 | 4,161 | 4,045 | 3,525 | ||||||||||||||
Capital markets and international banking service fees | 3,253 | 4,021 | 3,313 | 2,771 | 3,227 | ||||||||||||||
Other non-interest income | 9,306 | 9,314 | 10,252 | 8,544 | 7,789 | ||||||||||||||
Total non-interest income | 41,879 | 41,404 | 39,817 | 35,933 | 35,048 | ||||||||||||||
Non-interest expense: | |||||||||||||||||||
Salaries and employee benefits expense: | |||||||||||||||||||
Salaries | 42,120 | 42,797 | 38,575 | 35,951 | 34,527 | ||||||||||||||
Commissions | 1,107 | 1,090 | 1,172 | 1,424 | 1,396 | ||||||||||||||
Bonus and stock-based compensation | 10,619 | 9,535 | 10,553 | 10,852 | 6,476 | ||||||||||||||
Other salaries and benefits (1) | 13,705 | 13,920 | 13,657 | 11,987 | 11,003 | ||||||||||||||
Total salaries and employee benefits expense | 67,551 | 67,342 | 63,957 | 60,214 | 53,402 | ||||||||||||||
Occupancy and equipment expense | 12,117 | 12,765 | 11,724 | 10,561 | 10,430 | ||||||||||||||
Computer services and telecommunication expense | 7,514 | 8,813 | 7,418 | 6,945 | 6,446 | ||||||||||||||
Professional and legal expense | 1,600 | 1,281 | 1,566 | 2,385 | 1,486 | ||||||||||||||
Other operating expenses | 18,255 | 17,430 | 16,467 | 16,587 | 15,570 | ||||||||||||||
Total non-interest expense | 107,037 | 107,631 | 101,132 | 96,692 | 87,334 | ||||||||||||||
Income before income taxes | 62,764 | 63,268 | 53,976 | 48,398 | 50,321 | ||||||||||||||
Income tax expense | 17,168 | 19,422 | 16,287 | 14,353 | 14,927 | ||||||||||||||
Net income | $ | 45,596 | $ | 43,846 | $ | 37,689 | $ | 34,045 | $ | 35,394 | |||||||||
Total assets (period end) | $ | 16,009,339 | $ | 16,368,881 | $ | 16,453,379 | $ | 13,296,238 | $ | 13,235,848 |
(1) | Includes health insurance, payroll taxes, 401(k) and profit sharing contributions, overtime and temporary help expenses. |
• | Net interest income decreased due to two fewer days during the quarter. |
• | Provision for credit losses decreased reflecting stable credit quality as well as net recoveries for the quarter. We continue to provide for credit losses for loans acquired in bank mergers reflecting the transfer from acquired to renewed status. |
• | Non-interest income was consistent with the prior quarter. Commercial deposit and treasury management fees increased due to additional fees paid by existing customers, and card fees increased as a result of promotional debit card income during the quarter. Lease financing revenue, which includes revenue related to investments in joint venture lease pools, increased in the quarter due to higher earnings from these lease pools. These increases were offset by a decrease in capital markets and international banking service fees mainly due to lower M&A advisory and swap fees. |
• | Non-interest expense decreased mostly as a result of lower computer services and telecommunication expense driven by lower systems expense. This decrease was partially offset by higher bonus and stock-based compensation expense. |
• | Income tax expense was lower as a result of $2.7 million of tax benefit recorded for the vesting of restricted shares and exercises of stock options compared to $849 thousand in the prior quarter. The tax expense or benefit related to the vesting of restricted shares and exercises of stock options can fluctuate from period to period based on activity and the stock price of our common shares. |
• | Total assets decreased due to the transfer of previously acquired residential real estate loans to the Mortgage Banking Segment. |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | |||||||||||||||
Net interest income | $ | 2,269 | $ | 2,413 | $ | 2,168 | $ | 2,411 | $ | 2,423 | |||||||||
Provision for credit losses | (135 | ) | (1,750 | ) | 1,964 | (356 | ) | 437 | |||||||||||
Net interest income after provision for credit losses | 2,404 | 4,163 | 204 | 2,767 | 1,986 | ||||||||||||||
Non-interest income: | |||||||||||||||||||
Lease financing revenue, net | 20,253 | 19,005 | 17,974 | 14,919 | 18,367 | ||||||||||||||
Other non-interest income | 1,173 | 754 | 785 | 786 | 839 | ||||||||||||||
Total non-interest income | 21,426 | 19,759 | 18,759 | 15,705 | 19,206 | ||||||||||||||
Non-interest expense: | |||||||||||||||||||
Salaries and employee benefits expense: | |||||||||||||||||||
Salaries | 4,810 | 4,811 | 4,550 | 4,242 | 3,810 | ||||||||||||||
Commissions | 2,572 | 1,038 | 1,597 | 1,274 | 2,958 | ||||||||||||||
Bonus and stock-based compensation | 955 | 1,516 | 950 | 829 | 872 | ||||||||||||||
Other salaries and benefits (1) | 1,581 | 1,317 | 1,310 | 1,262 | 1,443 | ||||||||||||||
Total salaries and employee benefits expense | 9,918 | 8,682 | 8,407 | 7,607 | 9,083 | ||||||||||||||
Occupancy and equipment expense | 944 | 929 | 966 | 947 | 895 | ||||||||||||||
Computer services and telecommunication expense | 458 | 483 | 432 | 431 | 363 | ||||||||||||||
Professional and legal expense | 399 | 652 | 802 | 414 | 409 | ||||||||||||||
Other operating expenses | 2,088 | 1,714 | 1,997 | 1,716 | 1,447 | ||||||||||||||
Total non-interest expense | 13,807 | 12,460 | 12,604 | 11,115 | 12,197 | ||||||||||||||
Income before income taxes | 10,023 | 11,462 | 6,359 | 7,357 | 8,995 | ||||||||||||||
Income tax expense | 4,119 | 4,653 | 2,484 | 2,879 | 3,509 | ||||||||||||||
Net income | $ | 5,904 | $ | 6,809 | $ | 3,875 | $ | 4,478 | $ | 5,486 | |||||||||
Total assets (period end) | $ | 1,173,558 | $ | 1,224,169 | $ | 1,126,847 | $ | 1,081,723 | $ | 1,045,117 |
(1) | Includes health insurance, payroll taxes, 401(k) and profit sharing contributions, overtime and temporary help expenses. |
• | Prior quarter included a $1.8 million negative provision for credit losses due to improvement of a potential problem loan. |
• | Lease financing revenue increased as a result of higher promotional income and residual gains partly offset by the decrease in fees from the sale of third-party equipment maintenance contracts. |
• | Non-interest expense increased due to higher commissions expense as a result of greater lease financing revenue and lower indirect capitalized costs. Bonus and stock-based compensation was higher in the prior quarter as a result of strong performance in 2016. |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | |||||||||||||||
Net interest income | $ | 9,325 | $ | 9,113 | $ | 8,918 | $ | 8,039 | $ | 7,273 | |||||||||
Provision for credit losses | 342 | 179 | 191 | 190 | 125 | ||||||||||||||
Net interest income after provision for credit losses | 8,983 | 8,934 | 8,727 | 7,849 | 7,148 | ||||||||||||||
Non-interest income: | |||||||||||||||||||
Mortgage origination revenue | 21,465 | 29,317 | 39,962 | 31,417 | 16,894 | ||||||||||||||
Mortgage servicing revenue | 6,314 | 2,960 | 9,133 | 8,198 | 10,588 | ||||||||||||||
Other non-interest income | — | — | — | — | (3 | ) | |||||||||||||
Total non-interest income | 27,779 | 32,277 | 49,095 | 39,615 | 27,479 | ||||||||||||||
Non-interest expense: | |||||||||||||||||||
Salaries and employee benefits expense: | |||||||||||||||||||
Salaries | 11,881 | 12,945 | 12,958 | 12,088 | 11,450 | ||||||||||||||
Commissions | 4,932 | 8,178 | 8,554 | 7,226 | 5,016 | ||||||||||||||
Bonus and stock-based compensation | 716 | 1,116 | 1,477 | 1,190 | 1,309 | ||||||||||||||
Other salaries and benefits (1) | 4,978 | 5,786 | 6,730 | 5,875 | 5,242 | ||||||||||||||
Total salaries and employee benefits expense | 22,507 | 28,025 | 29,719 | 26,379 | 23,017 | ||||||||||||||
Occupancy and equipment expense | 1,979 | 1,900 | 1,972 | 1,899 | 1,935 | ||||||||||||||
Computer services and telecommunication expense | 1,663 | 1,910 | 1,881 | 1,890 | 1,941 | ||||||||||||||
Professional and legal expense | 595 | 418 | 411 | 421 | 597 | ||||||||||||||
Other operating expenses | 7,238 | 6,971 | 6,587 | 6,309 | 5,484 | ||||||||||||||
Total non-interest expense | 33,982 | 39,224 | 40,570 | 36,898 | 32,974 | ||||||||||||||
Income before income taxes | 2,780 | 1,987 | 17,252 | 10,566 | 1,653 | ||||||||||||||
Income tax expense | 1,101 | 795 | 6,901 | 4,226 | 661 | ||||||||||||||
Net income | $ | 1,679 | $ | 1,192 | $ | 10,351 | $ | 6,340 | $ | 992 | |||||||||
Total assets (period end) | $ | 1,963,165 | $ | 1,709,267 | $ | 1,761,656 | $ | 1,617,829 | $ | 1,294,688 |
(1) | Includes health insurance, payroll taxes, 401(k) and profit sharing contributions, overtime and temporary help expenses. |
• | Lower mortgage origination volume and lower gain on sale margin caused a decrease in mortgage origination revenue. |
• | Mortgage servicing revenue increased due to higher servicing revenue and a lower decrease in the fair value of the mortgage servicing asset net of the related economic hedge activity. |
• | Non-interest expense decreased mostly due to lower salaries and employee benefits expense. Salaries expense decreased as a result of a decline in the number of full time equivalent employees. Commissions expense decreased due to lower mortgage origination volume. |
• | Computer services and telecommunication expense decreased due to lower systems expense. |
• | Total assets increased due to the transfer of previously acquired residential real estate loans from the Banking Segment and loan growth partially offset by a decrease in loans held for sale. |
CONSOLIDATED BALANCE SHEETS (Unaudited) |
(Dollars in thousands) | 3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | |||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and due from banks | $ | 368,078 | $ | 364,783 | $ | 351,009 | $ | 303,037 | $ | 271,732 | ||||||||||
Interest earning deposits with banks | 102,328 | 98,686 | 125,250 | 123,086 | 113,785 | |||||||||||||||
Total cash and cash equivalents | 470,406 | 463,469 | 476,259 | 426,123 | 385,517 | |||||||||||||||
Investment securities: | ||||||||||||||||||||
Securities available for sale, at fair value | 1,657,950 | 1,696,195 | 1,859,356 | 1,477,395 | 1,532,844 | |||||||||||||||
Securities held to maturity, at amortized cost | 1,056,008 | 1,069,750 | 1,115,262 | 1,151,415 | 1,191,910 | |||||||||||||||
Non-marketable securities - FHLB and FRB Stock | 144,427 | 143,276 | 146,209 | 130,232 | 121,750 | |||||||||||||||
Total investment securities | 2,858,385 | 2,909,221 | 3,120,827 | 2,759,042 | 2,846,504 | |||||||||||||||
Loans held for sale | 493,261 | 716,883 | 899,412 | 843,379 | 632,196 | |||||||||||||||
Loans: | ||||||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 12,789,667 | 12,605,726 | 12,379,358 | 10,061,076 | 9,820,903 | |||||||||||||||
Purchased credit-impaired loans | 168,814 | 163,077 | 161,338 | 136,811 | 140,445 | |||||||||||||||
Total loans | 12,958,481 | 12,768,803 | 12,540,696 | 10,197,887 | 9,961,348 | |||||||||||||||
Less: Allowance for loan and lease losses | 144,170 | 139,366 | 139,528 | 135,614 | 134,493 | |||||||||||||||
Net loans | 12,814,311 | 12,629,437 | 12,401,168 | 10,062,273 | 9,826,855 | |||||||||||||||
Lease investments, net | 315,523 | 311,327 | 277,647 | 233,320 | 216,046 | |||||||||||||||
Premises and equipment, net | 290,767 | 293,910 | 283,112 | 243,319 | 238,578 | |||||||||||||||
Cash surrender value of life insurance | 202,233 | 200,945 | 199,628 | 138,657 | 137,807 | |||||||||||||||
Goodwill | 999,925 | 1,001,038 | 993,799 | 725,039 | 725,068 | |||||||||||||||
Other intangibles | 60,869 | 62,959 | 65,395 | 41,569 | 43,186 | |||||||||||||||
Mortgage servicing rights, at fair value | 251,498 | 238,011 | 154,730 | 134,969 | 145,800 | |||||||||||||||
Other real estate owned, net | 14,706 | 26,279 | 33,105 | 27,663 | 28,309 | |||||||||||||||
Other real estate owned related to FDIC transactions | 3,864 | 5,006 | 5,177 | 8,356 | 10,397 | |||||||||||||||
Other assets | 370,314 | 443,832 | 431,623 | 352,081 | 339,390 | |||||||||||||||
Total assets | $ | 19,146,062 | $ | 19,302,317 | $ | 19,341,882 | $ | 15,995,790 | $ | 15,575,653 | ||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||
Liabilities | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
Non-interest bearing | $ | 6,211,173 | $ | 6,408,169 | $ | 6,410,334 | $ | 4,775,364 | $ | 4,667,410 | ||||||||||
Interest bearing | 7,788,210 | 7,702,279 | 7,868,932 | 6,660,732 | 6,866,416 | |||||||||||||||
Total deposits | 13,999,383 | 14,110,448 | 14,279,266 | 11,436,096 | 11,533,826 | |||||||||||||||
Short-term borrowings | 1,550,628 | 1,569,288 | 1,496,319 | 1,246,994 | 884,101 | |||||||||||||||
Long-term borrowings | 315,618 | 311,790 | 311,645 | 518,545 | 439,615 | |||||||||||||||
Junior subordinated notes issued to capital trusts | 210,769 | 210,668 | 209,159 | 185,925 | 185,820 | |||||||||||||||
Accrued expenses and other liabilities | 453,236 | 520,914 | 482,085 | 451,695 | 409,406 | |||||||||||||||
Total liabilities | 16,529,634 | 16,723,108 | 16,778,474 | 13,839,255 | 13,452,768 | |||||||||||||||
Stockholders' Equity | ||||||||||||||||||||
Preferred stock | 115,572 | 115,572 | 116,507 | 115,280 | 115,280 | |||||||||||||||
Common stock | 857 | 856 | 855 | 757 | 756 | |||||||||||||||
Additional paid-in capital | 1,675,956 | 1,678,826 | 1,674,341 | 1,288,777 | 1,284,438 | |||||||||||||||
Retained earnings | 875,295 | 838,892 | 809,769 | 783,468 | 756,272 | |||||||||||||||
Accumulated other comprehensive income | 8,415 | 5,190 | 23,763 | 28,731 | 24,687 | |||||||||||||||
Treasury stock | (59,667 | ) | (60,384 | ) | (62,084 | ) | (60,732 | ) | (59,863 | ) | ||||||||||
Controlling interest stockholders' equity | 2,616,428 | 2,578,952 | 2,563,151 | 2,156,281 | 2,121,570 | |||||||||||||||
Noncontrolling interest | — | 257 | 257 | 254 | 1,315 | |||||||||||||||
Total stockholders' equity | 2,616,428 | 2,579,209 | 2,563,408 | 2,156,535 | 2,122,885 | |||||||||||||||
Total liabilities and stockholders' equity | $ | 19,146,062 | $ | 19,302,317 | $ | 19,341,882 | $ | 15,995,790 | $ | 15,575,653 |
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) |
(Dollars in thousands, except per share data) | 1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | |||||||||||||||
Interest income: | ||||||||||||||||||||
Loans: | ||||||||||||||||||||
Taxable | $ | 133,737 | $ | 134,048 | $ | 118,675 | $ | 110,231 | $ | 104,923 | ||||||||||
Nontaxable | 2,880 | 2,947 | 2,846 | 2,741 | 2,586 | |||||||||||||||
Investment securities: | ||||||||||||||||||||
Taxable | 9,122 | 9,362 | 8,844 | 7,799 | 9,566 | |||||||||||||||
Nontaxable | 9,973 | 10,220 | 10,382 | 10,644 | 10,776 | |||||||||||||||
Other interest earning accounts | 199 | 157 | 164 | 125 | 141 | |||||||||||||||
Total interest income | 155,911 | 156,734 | 140,911 | 131,540 | 127,992 | |||||||||||||||
Interest expense: | ||||||||||||||||||||
Deposits | 7,475 | 7,324 | 6,681 | 5,952 | 5,622 | |||||||||||||||
Short-term borrowings | 2,380 | 1,472 | 1,092 | 910 | 721 | |||||||||||||||
Long-term borrowings and junior subordinated notes | 3,013 | 2,724 | 2,367 | 2,076 | 2,345 | |||||||||||||||
Total interest expense | 12,868 | 11,520 | 10,140 | 8,938 | 8,688 | |||||||||||||||
Net interest income | 143,043 | 145,214 | 130,771 | 122,602 | 119,304 | |||||||||||||||
Provision for credit losses | 3,734 | 2,622 | 6,549 | 2,829 | 7,563 | |||||||||||||||
Net interest income after provision for credit losses | 139,309 | 142,592 | 124,222 | 119,773 | 111,741 | |||||||||||||||
Non-interest income: | ||||||||||||||||||||
Mortgage banking revenue | 27,779 | 32,277 | 49,095 | 39,615 | 27,482 | |||||||||||||||
Lease financing revenue, net | 21,418 | 19,868 | 18,864 | 15,708 | 19,046 | |||||||||||||||
Commercial deposit and treasury management fees | 14,689 | 14,237 | 12,957 | 11,548 | 11,878 | |||||||||||||||
Trust and asset management fees | 8,520 | 8,442 | 8,244 | 8,236 | 7,950 | |||||||||||||||
Card fees | 4,566 | 4,340 | 4,161 | 4,045 | 3,525 | |||||||||||||||
Capital markets and international banking service fees | 3,253 | 4,021 | 3,313 | 2,771 | 3,227 | |||||||||||||||
Consumer and other deposit service fees | 3,363 | 3,563 | 3,559 | 3,161 | 3,025 | |||||||||||||||
Brokerage fees | 1,125 | 887 | 1,294 | 1,315 | 1,158 | |||||||||||||||
Loan service fees | 1,969 | 1,952 | 1,792 | 1,961 | 1,752 | |||||||||||||||
Increase in cash surrender value of life insurance | 1,288 | 1,316 | 1,055 | 850 | 854 | |||||||||||||||
Net gain on investment securities | 231 | 178 | — | 269 | — | |||||||||||||||
Net (loss) gain on disposal of other assets | (123 | ) | (749 | ) | 5 | (2 | ) | (48 | ) | |||||||||||
Other operating income | 3,695 | 2,491 | 4,048 | 2,523 | 1,844 | |||||||||||||||
Total non-interest income | 91,773 | 92,823 | 108,387 | 92,000 | 81,693 | |||||||||||||||
Non-interest expense: | ||||||||||||||||||||
Salaries and employee benefits expense | 101,551 | 108,428 | 111,478 | 95,004 | 85,591 | |||||||||||||||
Occupancy and equipment expense | 15,044 | 15,689 | 14,766 | 13,415 | 13,260 | |||||||||||||||
Computer services and telecommunication expense | 9,440 | 11,800 | 12,836 | 9,777 | 9,055 | |||||||||||||||
Advertising and marketing expense | 3,161 | 3,045 | 3,084 | 2,964 | 2,878 | |||||||||||||||
Professional and legal expense | 2,691 | 2,509 | 4,460 | 3,321 | 2,589 | |||||||||||||||
Other intangible amortization expense | 2,091 | 2,388 | 1,674 | 1,617 | 1,626 | |||||||||||||||
Branch exit and facilities impairment charges | (682 | ) | — | (2,908 | ) | 155 | 44 | |||||||||||||
Net loss (gain) recognized on other real estate owned and other related expense | 844 | (790 | ) | (721 | ) | 258 | (346 | ) | ||||||||||||
Other operating expenses | 21,525 | 22,691 | 25,716 | 21,395 | 21,103 | |||||||||||||||
Total non-interest expense | 155,665 | 165,760 | 170,385 | 147,906 | 135,800 | |||||||||||||||
Income before income taxes | 75,417 | 69,655 | 62,224 | 63,867 | 57,634 | |||||||||||||||
Income tax expense | 20,880 | 22,464 | 17,805 | 20,455 | 18,520 | |||||||||||||||
Net income | 54,537 | 47,191 | 44,419 | 43,412 | 39,114 | |||||||||||||||
Dividends on preferred shares | 2,003 | 2,005 | 2,004 | 2,000 | 2,000 | |||||||||||||||
Net income available to common stockholders | $ | 52,534 | $ | 45,186 | $ | 42,415 | $ | 41,412 | $ | 37,114 |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Common share data: | ||||||||||||||||||||
Basic earnings per common share | $ | 0.63 | $ | 0.54 | $ | 0.55 | $ | 0.56 | $ | 0.51 | ||||||||||
Diluted earnings per common share | 0.62 | 0.53 | 0.54 | 0.56 | 0.50 | |||||||||||||||
Weighted average common shares outstanding for basic earnings per common share | 83,662,430 | 83,484,899 | 77,506,885 | 73,475,258 | 73,330,731 | |||||||||||||||
Weighted average common shares outstanding for diluted earnings per common share | 84,778,130 | 84,674,181 | 78,683,170 | 74,180,374 | 73,966,935 | |||||||||||||||
Common shares outstanding (at end of period) | 83,832,648 | 83,725,269 | 83,555,257 | 73,740,348 | 73,639,487 |
SELECTED FINANCIAL DATA |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Performance Ratios: | ||||||||||||||||||||
Annualized return on average assets | 1.16 | % | 0.98 | % | 1.02 | % | 1.11 | % | 1.02 | % | ||||||||||
Annualized operating return on average assets (1) | 1.13 | 1.07 | 1.20 | 1.15 | 1.09 | |||||||||||||||
Annualized return on average common equity | 8.62 | 7.36 | 7.67 | 8.27 | 7.52 | |||||||||||||||
Annualized operating return on average common equity (1) | 8.39 | 8.12 | 9.02 | 8.56 | 8.08 | |||||||||||||||
Annualized cash return on average tangible common equity (2) | 15.27 | 13.22 | 12.99 | 13.53 | 12.47 | |||||||||||||||
Annualized cash operating return on average tangible common equity (3) | 14.88 | 14.54 | 15.23 | 13.99 | 13.37 | |||||||||||||||
Net interest rate spread | 3.52 | 3.48 | 3.50 | 3.64 | 3.63 | |||||||||||||||
Cost of funds (4) | 0.33 | 0.28 | 0.28 | 0.27 | 0.27 | |||||||||||||||
Efficiency ratio (5) | 63.99 | 64.62 | 62.69 | 65.32 | 63.49 | |||||||||||||||
Annualized net non-interest expense to average assets (6) | 1.35 | 1.35 | 1.06 | 1.35 | 1.31 | |||||||||||||||
Core non-interest income to revenues (7) | 37.87 | 38.15 | 43.98 | 41.40 | 39.38 | |||||||||||||||
Net interest margin | 3.57 | 3.50 | 3.49 | 3.60 | 3.57 | |||||||||||||||
Tax equivalent effect | 0.17 | 0.17 | 0.19 | 0.21 | 0.22 | |||||||||||||||
Net interest margin - fully tax equivalent basis (8) | 3.74 | 3.67 | 3.68 | 3.81 | 3.79 | |||||||||||||||
Net interest margin - fully tax equivalent basis excluding acquisition accounting discount accretion on bank merger loans (9) | 3.55 | 3.47 | 3.50 | 3.57 | 3.55 | |||||||||||||||
Loans to deposits | 92.56 | 90.49 | 87.82 | 89.17 | 86.37 | |||||||||||||||
Asset Quality Ratios: | ||||||||||||||||||||
Non-performing loans (10) to total loans | 0.38 | % | 0.46 | % | 0.43 | % | 0.73 | % | 0.95 | % | ||||||||||
Non-performing assets (10) to total assets | 0.34 | 0.45 | 0.45 | 0.64 | 0.79 | |||||||||||||||
Allowance for loan and lease losses to non-performing loans (10) | 293.02 | 234.81 | 258.82 | 181.46 | 142.00 | |||||||||||||||
Allowance for loan and lease losses to total loans | 1.11 | 1.09 | 1.11 | 1.33 | 1.35 | |||||||||||||||
Net loan (recoveries) charge-offs to average loans, excluding loans held for sale (annualized) | (0.03 | ) | 0.10 | 0.09 | 0.09 | 0.06 | ||||||||||||||
Capital Ratios: | ||||||||||||||||||||
Tangible equity to tangible assets (11) | 8.71 | % | 8.42 | % | 8.34 | % | 9.21 | % | 9.24 | % | ||||||||||
Tangible common equity to tangible assets (12) | 8.07 | 7.79 | 7.71 | 8.46 | 8.46 | |||||||||||||||
Tangible common equity to risk weighted assets (13) | 9.07 | 8.80 | 8.83 | 9.75 | 9.54 | |||||||||||||||
Total capital (to risk-weighted assets) (14) | 11.80 | 11.63 | 11.66 | 12.81 | 12.65 | |||||||||||||||
Tier 1 capital (to risk-weighted assets) (14) | 9.54 | 9.40 | 9.40 | 11.77 | 11.60 | |||||||||||||||
Common equity tier 1 capital (to risk-weighted assets) (14) | 8.84 | 8.72 | 8.71 | 9.52 | 9.33 | |||||||||||||||
Tier 1 capital (to average assets) (14) | 8.58 | 8.38 | 9.29 | 10.41 | 10.38 | |||||||||||||||
Per Share Data: | ||||||||||||||||||||
Book value per common share (15) | $ | 29.83 | $ | 29.43 | $ | 29.28 | $ | 27.68 | $ | 27.26 | ||||||||||
Less: goodwill and other intangible assets, net of tax benefit, per common share | 12.40 | 12.45 | 12.40 | 10.20 | 10.22 | |||||||||||||||
Tangible book value per common share (16) | $ | 17.43 | $ | 16.98 | $ | 16.88 | $ | 17.48 | $ | 17.04 | ||||||||||
Cash dividends per common share | $ | 0.19 | $ | 0.19 | $ | 0.19 | $ | 0.19 | $ | 0.17 |
(1) | Annualized operating return on average assets is computed by dividing annualized operating earnings by average total assets. Annualized operating return on average common equity is computed by dividing annualized operating earnings by average common equity. Operating earnings is defined as net income as reported less non-core items, net of tax. |
(2) | Annualized cash return on average tangible common equity is computed by dividing net cash flow available to common stockholders (net income available to common stockholders, plus other intangibles amortization expense, net of tax benefit) by average tangible common equity (average common stockholders' equity less average goodwill and average other intangibles, net of tax benefit). |
(3) | Annualized cash operating return on average tangible common equity is computed by dividing annualized cash operating earnings (operating earnings plus other intangibles amortization expense, net of tax benefit, less dividends on preferred shares) by average tangible common equity. Operating earnings is defined as net income as reported less non-core items, net of tax. |
(4) | Equals total interest expense divided by the sum of average interest bearing liabilities and noninterest bearing deposits. |
(5) | Equals total non-interest expense excluding non-core items divided by the sum of net interest income on a fully tax equivalent basis, total non-interest income less non-core items, and tax equivalent adjustment on the increase in cash surrender value of life insurance. |
(6) | Equals total non-interest expense excluding non-core items less total non-interest income excluding non-core items, and including tax equivalent adjustment on the increase in cash surrender value of life insurance divided by average assets. |
(7) | Equals total non-interest income excluding non-core items and tax equivalent adjustment on the increase in cash surrender value of life insurance divided by the sum of net interest income on a fully tax equivalent basis, total non-interest income less non-core items, and tax equivalent adjustment on the increase in cash surrender value of life insurance. |
(8) | Represents net interest income on a fully tax equivalent basis assuming a 35% tax rate, as a percentage of average interest earning assets. |
(9) | Represents net interest income on a fully tax equivalent basis assuming a 35% tax rate, excluding acquisition accounting discount accretion on bank merger loans as a percentage of average interest earning assets. |
(10) | Non-performing loans excludes purchased credit-impaired loans and loans held for sale. Non-performing assets excludes purchased credit-impaired loans, loans held for sale, and other real estate owned related to FDIC transactions. |
(11) | Equals total ending stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by total assets less goodwill and other intangibles, net of tax benefit. |
(12) | Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by total assets less goodwill and other intangibles, net of tax benefit. |
(13) | Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by risk-weighted assets. Current quarter risk-weighted assets are estimated. |
(14) | Current quarter ratios are estimated. |
(15) | Equals total ending common stockholders’ equity divided by common shares outstanding. |
(16) | Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by common shares outstanding. |
INVESTMENT SECURITIES |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | ||||||||||||||||
Securities available for sale: | ||||||||||||||||||||
Fair value | ||||||||||||||||||||
Government sponsored agencies and enterprises | $ | 23,330 | $ | 23,415 | $ | 53,968 | $ | 54,457 | $ | 64,762 | ||||||||||
States and political subdivisions | 389,109 | 391,365 | 410,737 | 400,948 | 398,024 | |||||||||||||||
Mortgage-backed securities | 1,056,529 | 1,076,692 | 1,173,330 | 785,367 | 834,559 | |||||||||||||||
Corporate bonds | 178,097 | 193,895 | 210,193 | 225,525 | 224,530 | |||||||||||||||
Equity securities | 10,885 | 10,828 | 11,128 | 11,098 | 10,969 | |||||||||||||||
Total fair value | $ | 1,657,950 | $ | 1,696,195 | $ | 1,859,356 | $ | 1,477,395 | $ | 1,532,844 | ||||||||||
Unrealized gain, net | ||||||||||||||||||||
Government sponsored agencies and enterprises | $ | 126 | $ | 148 | $ | 512 | $ | 783 | $ | 1,162 | ||||||||||
States and political subdivisions | 17,780 | 14,824 | 27,696 | 31,132 | 27,018 | |||||||||||||||
Mortgage-backed securities | (2,412 | ) | (4,001 | ) | 12,534 | 16,258 | 13,734 | |||||||||||||
Corporate bonds | 762 | 731 | 1,253 | 795 | (1,127 | ) | ||||||||||||||
Equity securities | (172 | ) | (172 | ) | 196 | 226 | 155 | |||||||||||||
Total unrealized gain, net | $ | 16,084 | $ | 11,530 | $ | 42,191 | $ | 49,194 | $ | 40,942 | ||||||||||
Securities held to maturity, at amortized cost: | ||||||||||||||||||||
States and political subdivisions | $ | 910,336 | $ | 910,608 | $ | 939,491 | $ | 960,784 | $ | 986,340 | ||||||||||
Mortgage-backed securities | 145,672 | 159,142 | 175,771 | 190,631 | 205,570 | |||||||||||||||
Total amortized cost | $ | 1,056,008 | $ | 1,069,750 | $ | 1,115,262 | $ | 1,151,415 | $ | 1,191,910 |
LOAN PORTFOLIO |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||
Commercial-related loans: | |||||||||||||||||||||||||||||||||||
Commercial | $ | 4,364,122 | 34 | % | $ | 4,346,506 | 34 | % | $ | 4,385,812 | 35 | % | $ | 3,561,500 | 35 | % | $ | 3,509,604 | 36 | % | |||||||||||||||
Commercial loans collateralized by assignment of lease payments (lease loans) | 2,008,601 | 16 | 2,002,976 | 16 | 1,873,380 | 15 | 1,794,465 | 18 | 1,774,104 | 18 | |||||||||||||||||||||||||
Commercial real estate | 3,734,171 | 29 | 3,788,016 | 29 | 3,794,801 | 30 | 2,827,720 | 28 | 2,831,814 | 28 | |||||||||||||||||||||||||
Construction real estate | 554,942 | 4 | 518,562 | 4 | 451,023 | 4 | 357,807 | 3 | 310,278 | 3 | |||||||||||||||||||||||||
Total commercial-related loans | 10,661,836 | 83 | 10,656,060 | 83 | 10,505,016 | 84 | 8,541,492 | 84 | 8,425,800 | 85 | |||||||||||||||||||||||||
Other loans: | |||||||||||||||||||||||||||||||||||
Residential real estate | 1,227,218 | 9 | 1,060,828 | 8 | 998,827 | 8 | 753,707 | 7 | 677,791 | 7 | |||||||||||||||||||||||||
Indirect vehicle | 573,792 | 4 | 541,680 | 4 | 522,271 | 4 | 491,480 | 5 | 432,915 | 4 | |||||||||||||||||||||||||
Home equity | 246,805 | 2 | 266,377 | 2 | 275,288 | 2 | 198,622 | 2 | 207,079 | 2 | |||||||||||||||||||||||||
Consumer | 80,016 | 1 | 80,781 | 1 | 77,956 | 1 | 75,775 | 1 | 77,318 | 1 | |||||||||||||||||||||||||
Total other loans | 2,127,831 | 16 | 1,949,666 | 15 | 1,874,342 | 15 | 1,519,584 | 15 | 1,395,103 | 14 | |||||||||||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 12,789,667 | 99 | 12,605,726 | 98 | 12,379,358 | 99 | 10,061,076 | 99 | 9,820,903 | 99 | |||||||||||||||||||||||||
Purchased credit-impaired loans | 168,814 | 1 | 163,077 | 2 | 161,338 | 1 | 136,811 | 1 | 140,445 | 1 | |||||||||||||||||||||||||
Total loans | $ | 12,958,481 | 100 | % | $ | 12,768,803 | 100 | % | $ | 12,540,696 | 100 | % | $ | 10,197,887 | 100 | % | $ | 9,961,348 | 100 | % | |||||||||||||||
Change from prior quarter | +1.5 | % | +1.8 | % | +23.0 | % | +2.4 | % | +1.7 | % | |||||||||||||||||||||||||
Change from same quarter one year ago | +30.1 | % | +30.4 | % | +33.6 | % | +12.1 | % | +11.7 | % |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||
Commercial-related loans: | |||||||||||||||||||||||||||||||||||
Commercial | $ | 4,269,545 | 34 | % | $ | 4,274,398 | 35 | % | $ | 3,850,588 | 35 | % | $ | 3,522,641 | 35 | % | $ | 3,531,441 | 36 | % | |||||||||||||||
Commercial loans collateralized by assignment of lease payments (lease loans) | 1,938,564 | 15 | 1,896,486 | 15 | 1,825,505 | 16 | 1,777,763 | 18 | 1,754,558 | 18 | |||||||||||||||||||||||||
Commercial real estate | 3,742,505 | 30 | 3,775,599 | 30 | 3,183,131 | 29 | 2,821,516 | 28 | 2,734,148 | 28 | |||||||||||||||||||||||||
Construction real estate | 554,612 | 4 | 486,861 | 4 | 397,480 | 4 | 351,079 | 3 | 276,797 | 3 | |||||||||||||||||||||||||
Total commercial-related loans | 10,505,226 | 83 | 10,433,344 | 84 | 9,256,704 | 84 | 8,472,999 | 84 | 8,296,944 | 85 | |||||||||||||||||||||||||
Other loans: | |||||||||||||||||||||||||||||||||||
Residential real estate | 1,133,927 | 9 | 1,031,152 | 8 | 862,393 | 7 | 710,384 | 7 | 640,231 | 7 | |||||||||||||||||||||||||
Indirect vehicle | 552,669 | 4 | 532,782 | 4 | 507,772 | 5 | 462,053 | 5 | 404,473 | 4 | |||||||||||||||||||||||||
Home equity | 253,654 | 2 | 273,694 | 2 | 231,399 | 2 | 202,228 | 2 | 210,678 | 2 | |||||||||||||||||||||||||
Consumer | 81,564 | 1 | 80,113 | 1 | 77,451 | 1 | 78,108 | 1 | 80,569 | 1 | |||||||||||||||||||||||||
Total other loans | 2,021,814 | 16 | 1,917,741 | 15 | 1,679,015 | 15 | 1,452,773 | 15 | 1,335,951 | 14 | |||||||||||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 12,527,040 | 99 | 12,351,085 | 99 | 10,935,719 | 99 | 9,925,772 | 99 | 9,632,895 | 99 | |||||||||||||||||||||||||
Purchased credit-impaired loans | 156,058 | 1 | 152,509 | 1 | 135,548 | 1 | 136,415 | 1 | 139,451 | 1 | |||||||||||||||||||||||||
Total loans | $ | 12,683,098 | 100 | % | $ | 12,503,594 | 100 | % | $ | 11,071,267 | 100 | % | $ | 10,062,187 | 100 | % | $ | 9,772,346 | 100 | % | |||||||||||||||
Change from prior quarter | +1.4 | % | +12.9 | % | +10.0 | % | +3.0 | % | +2.5 | % | |||||||||||||||||||||||||
Change from same quarter one year ago | +29.8 | % | +31.1 | % | +20.5 | % | +12.2 | % | +9.9 | % |
ASSET QUALITY |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | ||||||||||||||||
Non-performing loans: | ||||||||||||||||||||
Non-accrual loans (1) | $ | 47,042 | $ | 48,974 | $ | 52,135 | $ | 67,544 | $ | 93,602 | ||||||||||
Loans 90 days or more past due, still accruing interest | 2,159 | 10,378 | 1,774 | 7,190 | 1,112 | |||||||||||||||
Total non-performing loans | 49,201 | 59,352 | 53,909 | 74,734 | 94,714 | |||||||||||||||
Other real estate owned | 14,706 | 26,279 | 33,105 | 27,663 | 28,309 | |||||||||||||||
Repossessed assets | 477 | 322 | 453 | 459 | 187 | |||||||||||||||
Total non-performing assets | $ | 64,384 | $ | 85,953 | $ | 87,467 | $ | 102,856 | $ | 123,210 | ||||||||||
Potential problem loans (2) | $ | 153,779 | $ | 144,544 | $ | 111,594 | $ | 99,782 | $ | 110,193 | ||||||||||
Purchased credit-impaired loans (3) | $ | 168,814 | $ | 163,077 | $ | 161,338 | $ | 136,811 | $ | 140,445 | ||||||||||
Total non-performing, potential problem and purchased credit-impaired loans | $ | 371,794 | $ | 366,973 | $ | 326,841 | $ | 311,327 | $ | 345,352 | ||||||||||
Total allowance for loan and lease losses | $ | 144,170 | $ | 139,366 | $ | 139,528 | $ | 135,614 | $ | 134,493 | ||||||||||
Accruing restructured loans (4) | 31,384 | 32,687 | 28,561 | 26,715 | 27,269 | |||||||||||||||
Total non-performing loans to total loans | 0.38 | % | 0.46 | % | 0.43 | % | 0.73 | % | 0.95 | % | ||||||||||
Total non-performing assets to total assets | 0.34 | 0.45 | 0.45 | 0.64 | 0.79 | |||||||||||||||
Allowance for loan and lease losses to non-performing loans | 293.02 | 234.81 | 258.82 | 181.46 | 142.00 |
(1) | Includes $20.7 million, $27.1 million, $23.4 million, $28.9 million and $24.0 million of restructured loans on non-accrual status at March 31, 2017, December 31, 2016, September 30, 2016, June 30, 2016 and March 31, 2016, respectively. |
(2) | We define potential problem loans as loans rated substandard that do not meet the definition of a non-performing loan. Potential problem loans carry a higher probability of default and require additional attention by management. |
(3) | Includes $68.8 million, $66.1 million, $60.1 million, $54.1 million and $50.4 million of Government National Mortgage Association ("GNMA") loans that have been repurchased at March 31, 2017, December 31, 2016, September 30, 2016, June 30, 2016 and March 31, 2016, respectively. |
(4) | Accruing restructured loans consist of loans that have been modified and are performing in accordance with those modified terms as of the dates indicated. |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | ||||||||||||||||
Commercial and lease | $ | 8,739 | $ | 15,189 | $ | 14,898 | $ | 29,509 | $ | 28,590 | ||||||||||
Commercial real estate | 8,719 | 11,767 | 4,655 | 7,163 | 27,786 | |||||||||||||||
Consumer-related | 31,743 | 32,396 | 34,356 | 38,062 | 38,338 | |||||||||||||||
Total non-performing loans | $ | 49,201 | $ | 59,352 | $ | 53,909 | $ | 74,734 | $ | 94,714 |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Allowance for credit losses, balance at the beginning of period | $ | 141,842 | $ | 142,399 | $ | 138,333 | $ | 137,732 | $ | 131,508 | ||||||||||
Provision for credit losses | 3,734 | 2,622 | 6,549 | 2,829 | 7,563 | |||||||||||||||
Charge-offs | 3,373 | 6,442 | 4,157 | 6,424 | 3,588 | |||||||||||||||
Recoveries | 4,295 | 3,263 | 1,674 | 4,196 | 2,249 | |||||||||||||||
Net (recoveries) charge-offs | (922 | ) | 3,179 | 2,483 | 2,228 | 1,339 | ||||||||||||||
Allowance for credit losses | 146,498 | 141,842 | 142,399 | 138,333 | 137,732 | |||||||||||||||
Allowance for unfunded credit commitments | (2,328 | ) | (2,476 | ) | (2,871 | ) | (2,719 | ) | (3,239 | ) | ||||||||||
Allowance for loan and lease losses | $ | 144,170 | $ | 139,366 | $ | 139,528 | $ | 135,614 | $ | 134,493 | ||||||||||
Total loans, excluding loans held for sale | $ | 12,958,481 | $ | 12,768,803 | $ | 12,540,696 | $ | 10,197,887 | $ | 9,961,348 | ||||||||||
Average loans, excluding loans held for sale | 12,683,098 | 12,503,594 | 11,071,267 | 10,062,187 | 9,772,346 | |||||||||||||||
Allowance for loan and lease losses to total loans, excluding loans held for sale | 1.11 | % | 1.09 | % | 1.11 | % | 1.33 | % | 1.35 | % | ||||||||||
Net loan (recoveries) charge-offs to average loans, excluding loans held for sale (annualized) | (0.03 | ) | 0.10 | 0.09 | 0.09 | 0.06 |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | ||||||||||||||||
Commercial related loans: | ||||||||||||||||||||
General reserve | $ | 125,370 | $ | 120,221 | $ | 112,653 | $ | 108,972 | $ | 98,001 | ||||||||||
Specific reserve | 1,272 | 3,243 | 9,698 | 12,205 | 20,995 | |||||||||||||||
Consumer related reserve | 17,528 | 15,902 | 17,177 | 14,437 | 15,497 | |||||||||||||||
Total allowance for loan and lease losses | $ | 144,170 | $ | 139,366 | $ | 139,528 | $ | 135,614 | $ | 134,493 |
Non-Accretable Discount - PCI Loans | Accretable Discount - PCI Loans | Accretable Discount - Non-PCI Loans | Total | |||||||||||||
Balance at beginning of period | $ | 27,617 | $ | 16,050 | $ | 36,598 | $ | 80,265 | ||||||||
Purchases (1) | (1,687 | ) | 43 | (202 | ) | (1,846 | ) | |||||||||
Charge-offs | (5,172 | ) | — | — | (5,172 | ) | ||||||||||
Accretion | — | (2,188 | ) | (4,970 | ) | (7,158 | ) | |||||||||
Transfer (2) | (1,006 | ) | 1,006 | — | — | |||||||||||
Balance at end of period | $ | 19,752 | $ | 14,911 | $ | 31,426 | $ | 66,089 |
(1) | The acquisition accounting discount for loans acquired in the American Chartered merger was revised compared to previously reported balances. The change is reflected in this line. |
(2) | The transfer from non-accretable discount on purchased credit-impaired loans to accretable discount was due to better than expected cash flows on several pools of purchased credit-impaired loans. |
DEPOSIT MIX |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||
Low cost deposits: | |||||||||||||||||||||||||||||||||||
Non-interest bearing deposits | $ | 6,211,173 | 44 | % | $ | 6,408,169 | 46 | % | $ | 6,410,334 | 45 | % | $ | 4,775,364 | 42 | % | $ | 4,667,410 | 40 | % | |||||||||||||||
Money market, NOW and interest bearing deposits | 4,580,773 | 33 | 4,543,004 | 32 | 4,660,407 | 33 | 3,771,111 | 33 | 4,048,054 | 35 | |||||||||||||||||||||||||
Savings deposits | 1,126,879 | 8 | 1,135,992 | 8 | 1,147,900 | 8 | 1,021,845 | 9 | 991,300 | 9 | |||||||||||||||||||||||||
Total low cost deposits | 11,918,825 | 85 | 12,087,165 | 86 | 12,218,641 | 86 | 9,568,320 | 84 | 9,706,764 | 84 | |||||||||||||||||||||||||
Certificates of deposit: | |||||||||||||||||||||||||||||||||||
Certificates of deposit | 1,261,228 | 9 | 1,225,102 | 9 | 1,298,186 | 9 | 1,220,562 | 11 | 1,255,457 | 11 | |||||||||||||||||||||||||
Brokered certificates of deposit | 819,330 | 6 | 798,181 | 5 | 762,439 | 5 | 647,214 | 5 | 571,605 | 5 | |||||||||||||||||||||||||
Total certificates of deposit | 2,080,558 | 15 | 2,023,283 | 14 | 2,060,625 | 14 | 1,867,776 | 16 | 1,827,062 | 16 | |||||||||||||||||||||||||
Total deposits | $ | 13,999,383 | 100 | % | $ | 14,110,448 | 100 | % | $ | 14,279,266 | 100 | % | $ | 11,436,096 | 100 | % | $ | 11,533,826 | 100 | % | |||||||||||||||
Change from prior quarter | -0.8 | % | -1.2 | % | +24.9 | % | -0.8 | % | +0.2 | % | |||||||||||||||||||||||||
Change from same quarter one year ago | +21.4 | % | +22.6 | % | +26.9 | % | +5.3 | % | +4.7 | % |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||
Low cost deposits: | |||||||||||||||||||||||||||||||||||
Non-interest bearing deposits | $ | 6,209,402 | 45 | % | $ | 6,454,025 | 45 | % | $ | 5,524,043 | 43 | % | $ | 4,806,692 | 42 | % | $ | 4,606,008 | 40 | % | |||||||||||||||
Money market, NOW and interest bearing deposits | 4,529,402 | 33 | 4,628,698 | 33 | 4,161,913 | 33 | 3,836,134 | 33 | 4,109,150 | 36 | |||||||||||||||||||||||||
Savings deposits | 1,131,757 | 8 | 1,140,926 | 8 | 1,080,609 | 8 | 1,006,902 | 9 | 984,019 | 9 | |||||||||||||||||||||||||
Total low cost deposits | 11,870,561 | 86 | 12,223,649 | 86 | 10,766,565 | 84 | 9,649,728 | 84 | 9,699,177 | 85 | |||||||||||||||||||||||||
Certificates of deposit: | |||||||||||||||||||||||||||||||||||
Certificates of deposit | 1,245,152 | 9 | 1,263,675 | 9 | 1,257,959 | 10 | 1,237,198 | 11 | 1,237,971 | 11 | |||||||||||||||||||||||||
Brokered certificates of deposit | 815,473 | 5 | 779,411 | 5 | 702,030 | 6 | 598,702 | 5 | 534,910 | 4 | |||||||||||||||||||||||||
Total certificates of deposit | 2,060,625 | 14 | 2,043,086 | 14 | 1,959,989 | 16 | 1,835,900 | 16 | 1,772,881 | 15 | |||||||||||||||||||||||||
Total deposits | $ | 13,931,186 | 100 | % | $ | 14,266,735 | 100 | % | $ | 12,726,554 | 100 | % | $ | 11,485,628 | 100 | % | $ | 11,472,058 | 100 | % | |||||||||||||||
Change from prior quarter | -2.4 | % | +12.1 | % | +10.8 | % | +0.1 | % | -0.5 | % | |||||||||||||||||||||||||
Change from same quarter one year ago | +21.4 | % | +23.7 | % | +13.2 | % | +5.4 | % | +4.4 | % |
NET INTEREST MARGIN |
1Q17 | 4Q16 | 1Q16 | ||||||||||||||||||||||||||||||||
Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | ||||||||||||||||||||||||||
Interest Earning Assets: | ||||||||||||||||||||||||||||||||||
Loans held for sale | $ | 565,128 | $ | 5,033 | 3.56 | % | $ | 859,254 | $ | 7,100 | 3.31 | % | $ | 661,021 | $ | 5,966 | 3.61 | % | ||||||||||||||||
Loans (1) (2) (3): | ||||||||||||||||||||||||||||||||||
Commercial-related loans: | ||||||||||||||||||||||||||||||||||
Commercial | 4,269,545 | 45,755 | 4.29 | 4,274,398 | 45,255 | 4.14 | 3,531,441 | 37,357 | 4.18 | |||||||||||||||||||||||||
Commercial loans collateralized by assignment of lease payments (lease loans) | 1,938,564 | 17,781 | 3.67 | 1,896,486 | 17,275 | 3.64 | 1,754,558 | 16,577 | 3.78 | |||||||||||||||||||||||||
Commercial real estate | 3,742,505 | 40,500 | 4.33 | 3,775,599 | 41,508 | 4.30 | 2,734,148 | 28,039 | 4.06 | |||||||||||||||||||||||||
Construction real estate | 554,612 | 5,569 | 4.02 | 486,861 | 4,592 | 3.69 | 276,797 | 2,902 | 4.15 | |||||||||||||||||||||||||
Total commercial-related loans | 10,505,226 | 109,605 | 4.17 | 10,433,344 | 108,630 | 4.07 | 8,296,944 | 84,875 | 4.05 | |||||||||||||||||||||||||
Other loans: | ||||||||||||||||||||||||||||||||||
Residential real estate | 1,133,927 | 9,441 | 3.33 | 1,031,152 | 8,522 | 3.31 | 640,231 | 5,695 | 3.56 | |||||||||||||||||||||||||
Home equity | 253,654 | 2,502 | 4.00 | 273,694 | 2,651 | 3.85 | 210,678 | 2,033 | 3.88 | |||||||||||||||||||||||||
Indirect | 552,669 | 6,111 | 4.48 | 532,782 | 6,198 | 4.63 | 404,473 | 4,758 | 4.73 | |||||||||||||||||||||||||
Consumer | 81,564 | 800 | 3.98 | 80,113 | 776 | 3.86 | 80,569 | 794 | 3.97 | |||||||||||||||||||||||||
Total other loans | 2,021,814 | 18,854 | 3.78 | 1,917,741 | 18,147 | 3.76 | 1,335,951 | 13,280 | 4.00 | |||||||||||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 12,527,040 | 128,459 | 4.16 | 12,351,085 | 126,777 | 4.08 | 9,632,895 | 98,155 | 4.10 | |||||||||||||||||||||||||
Purchased credit-impaired loans | 156,058 | 4,675 | 12.15 | 152,509 | 4,704 | 12.27 | 139,451 | 4,780 | 13.75 | |||||||||||||||||||||||||
Total loans | 12,683,098 | 133,134 | 4.26 | 12,503,594 | 131,481 | 4.18 | 9,772,346 | 102,935 | 4.24 | |||||||||||||||||||||||||
Taxable investment securities | 1,593,209 | 9,122 | 2.29 | 1,721,537 | 9,362 | 2.18 | 1,524,583 | 9,566 | 2.51 | |||||||||||||||||||||||||
Investment securities exempt from federal income taxes (3) | 1,278,150 | 15,344 | 4.80 | 1,304,931 | 15,724 | 4.82 | 1,362,468 | 16,579 | 4.87 | |||||||||||||||||||||||||
Federal funds sold | 38 | 0 | 1.23 | 36 | 0 | 1.00 | 42 | 0 | 1.00 | |||||||||||||||||||||||||
Other interest earning deposits | 130,553 | 199 | 0.62 | 107,311 | 157 | 0.58 | 113,748 | 141 | 0.50 | |||||||||||||||||||||||||
Total interest earning assets | $ | 16,250,176 | $ | 162,832 | 4.06 | % | $ | 16,496,663 | $ | 163,824 | 3.95 | % | $ | 13,434,208 | $ | 135,187 | 4.05 | % | ||||||||||||||||
Non-interest earning assets | 2,752,806 | 2,696,084 | 2,053,357 | |||||||||||||||||||||||||||||||
Total assets | $ | 19,002,982 | $ | 19,192,747 | $ | 15,487,565 | ||||||||||||||||||||||||||||
Interest Bearing Liabilities: | ||||||||||||||||||||||||||||||||||
Core funding: | ||||||||||||||||||||||||||||||||||
Money market, NOW and interest bearing deposits | $ | 4,529,402 | $ | 2,622 | 0.23 | % | $ | 4,628,698 | $ | 2,593 | 0.22 | % | $ | 4,109,150 | $ | 2,086 | 0.20 | % | ||||||||||||||||
Savings deposits | 1,131,757 | 255 | 0.09 | 1,140,926 | 273 | 0.10 | 984,019 | 159 | 0.06 | |||||||||||||||||||||||||
Certificates of deposit | 1,245,152 | 1,690 | 0.55 | 1,263,675 | 1,728 | 0.54 | 1,237,971 | 1,413 | 0.46 | |||||||||||||||||||||||||
Customer repurchase agreements | 198,977 | 100 | 0.20 | 247,273 | 129 | 0.21 | 190,114 | 94 | 0.20 | |||||||||||||||||||||||||
Total core funding | 7,105,288 | 4,667 | 0.27 | 7,280,572 | 4,723 | 0.26 | 6,521,254 | 3,752 | 0.23 | |||||||||||||||||||||||||
Wholesale funding: | ||||||||||||||||||||||||||||||||||
Brokered certificates of deposit (includes fee expense) | 815,473 | 2,908 | 1.45 | 779,411 | 2,730 | 1.39 | 534,910 | 1,964 | 1.48 | |||||||||||||||||||||||||
Other borrowings | 1,819,393 | 5,293 | 1.16 | 1,638,605 | 4,067 | 0.97 | 1,327,274 | 2,972 | 0.89 | |||||||||||||||||||||||||
Total wholesale funding | 2,634,866 | 8,201 | 1.26 | 2,418,016 | 6,797 | 1.12 | 1,862,184 | 4,936 | 1.07 | |||||||||||||||||||||||||
Total interest bearing liabilities | $ | 9,740,154 | $ | 12,868 | 0.54 | % | $ | 9,698,588 | $ | 11,520 | 0.47 | % | $ | 8,383,438 | $ | 8,688 | 0.42 | % | ||||||||||||||||
Non-interest bearing deposits | 6,209,402 | 6,454,025 | 4,606,008 | |||||||||||||||||||||||||||||||
Other non-interest bearing liabilities | 465,083 | 482,449 | 398,460 | |||||||||||||||||||||||||||||||
Stockholders' equity | 2,588,343 | 2,557,685 | 2,099,659 | |||||||||||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 19,002,982 | $ | 19,192,747 | $ | 15,487,565 | ||||||||||||||||||||||||||||
Net interest income/interest rate spread (4) | $ | 149,964 | 3.52 | % | $ | 152,304 | 3.48 | % | $ | 126,499 | 3.63 | % | ||||||||||||||||||||||
Taxable equivalent adjustment | 6,921 | 7,090 | 7,195 | |||||||||||||||||||||||||||||||
Net interest income, as reported | $ | 143,043 | $ | 145,214 | $ | 119,304 | ||||||||||||||||||||||||||||
Net interest margin (5) | 3.57 | % | 3.50 | % | 3.57 | % | ||||||||||||||||||||||||||||
Tax equivalent effect | 0.17 | % | 0.17 | % | 0.22 | % | ||||||||||||||||||||||||||||
Net interest margin on a fully tax equivalent basis (5) | 3.74 | % | 3.67 | % | 3.79 | % |
(1) | Non-accrual loans are included in average loans. |
(2) | Interest income includes amortization of deferred loan origination fees and costs. |
(3) | Non-taxable loan and investment income is presented on a fully tax equivalent basis assuming a 35% tax rate. |
(4) | Interest rate spread represents the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities and is presented on a fully tax equivalent basis. |
(5) | Net interest margin represents net interest income as a percentage of average interest earning assets. |
1Q17 | 4Q16 | 1Q16 | |||||||||||||||||||||||||||||||
Average Balance | Interest | Yield | Average Balance | Interest | Yield | Average Balance | Interest | Yield | |||||||||||||||||||||||||
Loan yield excluding acquisition accounting discount accretion on bank merger loans: | |||||||||||||||||||||||||||||||||
Total loans, as reported | $ | 12,683,098 | $ | 133,134 | 4.26 | % | $ | 12,503,594 | $ | 131,481 | 4.18 | % | $ | 9,772,346 | $ | 102,935 | 4.24 | % | |||||||||||||||
Less acquisition accounting discount accretion on non-PCI loans | (38,442 | ) | 4,970 | (42,978 | ) | 4,854 | (32,293 | ) | 4,950 | ||||||||||||||||||||||||
Less acquisition accounting discount accretion on PCI loans | (33,811 | ) | 2,188 | (34,360 | ) | 2,709 | (25,696 | ) | 2,403 | ||||||||||||||||||||||||
Total loans, excluding acquisition accounting discount accretion on bank merger loans | $ | 12,755,351 | $ | 125,976 | 4.01 | % | $ | 12,580,932 | $ | 123,918 | 3.92 | % | $ | 9,830,335 | $ | 95,582 | 3.91 | % | |||||||||||||||
Net interest margin on a fully tax equivalent basis, excluding acquisition accounting discount accretion on bank merger loans: | |||||||||||||||||||||||||||||||||
Total interest earning assets, as reported | $ | 16,250,176 | $ | 149,964 | 3.74 | % | $ | 16,496,663 | $ | 152,304 | 3.67 | % | $ | 13,434,208 | $ | 126,499 | 3.79 | % | |||||||||||||||
Less acquisition accounting discount accretion on non-PCI loans | (38,442 | ) | 4,970 | (42,978 | ) | 4,854 | (32,293 | ) | 4,950 | ||||||||||||||||||||||||
Less acquisition accounting discount accretion on PCI loans | (33,811 | ) | 2,188 | (34,360 | ) | 2,709 | (25,696 | ) | 2,403 | ||||||||||||||||||||||||
Total interest earning assets/net interest margin on a fully tax equivalent basis, excluding acquisition accounting discount accretion on bank merger loans | $ | 16,322,429 | $ | 142,806 | 3.55 | % | $ | 16,574,001 | $ | 144,741 | 3.47 | % | $ | 13,492,197 | $ | 119,146 | 3.55 | % |
NON-INTEREST INCOME |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Core non-interest income: | ||||||||||||||||||||
Key fee initiatives: | ||||||||||||||||||||
Mortgage banking revenue | $ | 27,779 | $ | 32,277 | $ | 49,095 | $ | 39,615 | $ | 27,482 | ||||||||||
Lease financing revenue, net | 21,418 | 19,868 | 18,864 | 15,708 | 19,046 | |||||||||||||||
Commercial deposit and treasury management fees | 14,689 | 14,237 | 12,957 | 11,548 | 11,878 | |||||||||||||||
Trust and asset management fees | 8,520 | 8,442 | 8,244 | 8,236 | 7,950 | |||||||||||||||
Card fees | 4,566 | 4,340 | 4,161 | 4,045 | 3,525 | |||||||||||||||
Capital markets and international banking service fees | 3,253 | 4,021 | 3,313 | 2,771 | 3,227 | |||||||||||||||
Total key fee initiatives | 80,225 | 83,185 | 96,634 | 81,923 | 73,108 | |||||||||||||||
Consumer and other deposit service fees | 3,363 | 3,563 | 3,559 | 3,161 | 3,025 | |||||||||||||||
Brokerage fees | 1,125 | 887 | 1,294 | 1,315 | 1,158 | |||||||||||||||
Loan service fees | 1,969 | 1,952 | 1,792 | 1,961 | 1,752 | |||||||||||||||
Increase in cash surrender value of life insurance | 1,288 | 1,316 | 1,055 | 850 | 854 | |||||||||||||||
Other operating income | 2,734 | 2,350 | 3,337 | 2,043 | 1,836 | |||||||||||||||
Total core non-interest income | 90,704 | 93,253 | 107,671 | 91,253 | 81,733 | |||||||||||||||
Non-core non-interest income: | ||||||||||||||||||||
Net gain on investment securities | 231 | 178 | — | 269 | — | |||||||||||||||
Net (loss) gain on disposal of other assets | (123 | ) | (749 | ) | 5 | (2 | ) | (48 | ) | |||||||||||
Increase in market value of assets held in trust for deferred compensation (1) | 961 | 141 | 711 | 480 | 8 | |||||||||||||||
Total non-core non-interest income | 1,069 | (430 | ) | 716 | 747 | (40 | ) | |||||||||||||
Total non-interest income | $ | 91,773 | $ | 92,823 | $ | 108,387 | $ | 92,000 | $ | 81,693 |
(1) | Resides in other operating income in the consolidated statements of operations. |
NON-INTEREST EXPENSE |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Core non-interest expense: (1) | ||||||||||||||||||||
Salaries and employee benefits expense: | ||||||||||||||||||||
Salaries | $ | 58,811 | $ | 60,553 | $ | 56,083 | $ | 52,281 | $ | 49,787 | ||||||||||
Commissions | 8,611 | 10,306 | 11,323 | 9,924 | 9,370 | |||||||||||||||
Bonus and stock-based compensation | 12,290 | 12,167 | 12,980 | 12,871 | 8,657 | |||||||||||||||
Health and accident insurance | 6,623 | 5,951 | 6,377 | 6,079 | 5,599 | |||||||||||||||
Other salaries and benefits (2) | 13,641 | 15,072 | 15,320 | 13,045 | 12,089 | |||||||||||||||
Total salaries and employee benefits expense | 99,976 | 104,049 | 102,083 | 94,200 | 85,502 | |||||||||||||||
Occupancy and equipment expense | 15,040 | 15,594 | 14,662 | 13,407 | 13,260 | |||||||||||||||
Computer services and telecommunication expense | 9,255 | 11,019 | 9,731 | 9,266 | 8,750 | |||||||||||||||
Advertising and marketing expense | 3,161 | 3,039 | 3,031 | 2,923 | 2,855 | |||||||||||||||
Professional and legal expense | 2,594 | 2,351 | 2,779 | 3,220 | 2,492 | |||||||||||||||
Other intangible amortization expense | 2,091 | 2,388 | 1,674 | 1,617 | 1,626 | |||||||||||||||
Net loss (gain) recognized on other real estate owned (A) | 607 | (982 | ) | (908 | ) | 15 | (483 | ) | ||||||||||||
Other real estate expense, net (A) | 237 | 192 | 187 | 243 | 137 | |||||||||||||||
Other operating expenses | 21,485 | 21,478 | 21,067 | 19,814 | 18,366 | |||||||||||||||
Total core non-interest expense | 154,446 | 159,128 | 154,306 | 144,705 | 132,505 | |||||||||||||||
Non-core non-interest expense: (1) | ||||||||||||||||||||
Merger related and repositioning expenses (B) | 258 | 6,491 | 11,368 | 2,566 | 3,287 | |||||||||||||||
Branch exit and facilities impairment charges | — | — | — | 155 | — | |||||||||||||||
Contribution to MB Financial Charitable Foundation (C) | — | — | 4,000 | — | — | |||||||||||||||
Increase in market value of assets held in trust for deferred compensation (D) | 961 | 141 | 711 | 480 | 8 | |||||||||||||||
Total non-core non-interest expense | 1,219 | 6,632 | 16,079 | 3,201 | 3,295 | |||||||||||||||
Total non-interest expense | $ | 155,665 | $ | 165,760 | $ | 170,385 | $ | 147,906 | $ | 135,800 |
(1) | Letters denote the corresponding line items where these non-core non-interest expense items reside in the consolidated statements of operations as follows: A – Net loss (gain) recognized on other real estate owned and other expense, B – See merger related and repositioning expenses table below, C – Other operating expenses, and D – Salaries and employee benefits. |
(2) | Includes payroll taxes, 401(k) and profit sharing contributions, overtime and temporary help expenses. |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Merger related and repositioning expenses (1): | ||||||||||||||||||||
Salaries and employee benefits expense | $ | 614 | $ | 4,238 | $ | 8,684 | $ | 324 | $ | 81 | ||||||||||
Occupancy and equipment expense | 4 | 95 | 104 | 8 | — | |||||||||||||||
Computer services and telecommunication expense | 185 | 781 | 3,105 | 511 | 305 | |||||||||||||||
Advertising and marketing expense | — | 6 | 53 | 41 | 23 | |||||||||||||||
Professional and legal expense | 97 | 158 | 1,681 | 101 | 97 | |||||||||||||||
Branch exit and facilities impairment charges (2) | (682 | ) | — | (2,908 | ) | — | 44 | |||||||||||||
Contingent consideration expense - Celtic acquisition (3) | — | 1,000 | — | — | 2,703 | |||||||||||||||
Other operating expenses | 40 | 213 | 649 | 1,581 | 34 | |||||||||||||||
Total merger related and repositioning expenses | $ | 258 | $ | 6,491 | $ | 11,368 | $ | 2,566 | $ | 3,287 |
(1) | Primarily includes costs incurred in connection with the American Chartered merger. |
(2) | Includes a gain on the sale of a branch in the first quarter of 2017 and a reversal of an exit cost due to a favorable lease termination in the third quarter of 2016 on a branch acquired through the Taylor Capital merger. |
(3) | Includes an increase in our contingent consideration accrual for our acquisition of Celtic Leasing Corp. as a result of stronger lease residual performance than previously estimated. Resides in other operating expenses in the consolidated statements of operations. |
MORTGAGE BANKING SEGMENT DATA |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Mortgage origination revenue: | ||||||||||||||||||||
Gain on sale revenue, net (A) | $ | 15,607 | $ | 23,576 | $ | 35,190 | $ | 27,032 | $ | 14,299 | ||||||||||
Origination fees | 5,858 | 5,741 | 4,772 | 4,385 | 2,595 | |||||||||||||||
Total mortgage origination revenue | $ | 21,465 | $ | 29,317 | $ | 39,962 | $ | 31,417 | $ | 16,894 | ||||||||||
Mortgage servicing revenue: | ||||||||||||||||||||
Servicing fees | $ | 13,735 | $ | 12,610 | $ | 12,022 | $ | 11,418 | $ | 10,525 | ||||||||||
Amortization/prepayment of mortgage servicing rights (1) | (6,743 | ) | (8,777 | ) | (8,551 | ) | (7,790 | ) | (5,313 | ) | ||||||||||
Fair value changes of mortgage servicing rights | 4,083 | 65,006 | 9,853 | (19,035 | ) | (29,178 | ) | |||||||||||||
Economic hedge activity, net | (4,761 | ) | (65,879 | ) | (4,191 | ) | 23,605 | 34,554 | ||||||||||||
Fair value changes of mortgage servicing rights net of economic hedge activity | (678 | ) | (873 | ) | 5,662 | 4,570 | 5,376 | |||||||||||||
Total mortgage servicing revenue | $ | 6,314 | $ | 2,960 | $ | 9,133 | $ | 8,198 | $ | 10,588 | ||||||||||
Mortgage servicing rights, at fair value: | ||||||||||||||||||||
Beginning balance | $ | 238,011 | $ | 154,730 | $ | 134,969 | $ | 145,800 | $ | 168,162 | ||||||||||
Originations/purchases | 16,147 | 27,052 | 18,459 | 15,994 | 12,129 | |||||||||||||||
Amortization/prepayment (1) | (6,743 | ) | (8,777 | ) | (8,551 | ) | (7,790 | ) | (5,313 | ) | ||||||||||
Fair value changes | 4,083 | 65,006 | 9,853 | (19,035 | ) | (29,178 | ) | |||||||||||||
Ending balance | $ | 251,498 | $ | 238,011 | $ | 154,730 | $ | 134,969 | $ | 145,800 | ||||||||||
Mortgage servicing book (unpaid principal balance of loans serviced for others) | $ | 20,450,217 | $ | 19,683,073 | $ | 18,477,648 | $ | 17,739,626 | $ | 16,911,325 | ||||||||||
Mortgage servicing rights valuation | 1.23 | % | 1.21 | % | 0.84 | % | 0.76 | % | 0.86 | % | ||||||||||
Loans funded: | ||||||||||||||||||||
For sale | $ | 1,073,357 | $ | 1,933,208 | $ | 1,853,146 | $ | 1,594,632 | $ | 1,244,985 | ||||||||||
For investment | 212,745 | 121,198 | 123,228 | 114,412 | 83,819 | |||||||||||||||
Loans funded by purpose: | ||||||||||||||||||||
Refinance | 41 | % | 56 | % | 48 | % | 42 | % | 49 | % | ||||||||||
Purchase | 59 | 44 | 52 | 58 | 51 | |||||||||||||||
Loans funded by channel: | ||||||||||||||||||||
Retail | 23 | % | 21 | % | 22 | % | 23 | % | 19 | % | ||||||||||
Third party | 77 | 79 | 78 | 77 | 81 | |||||||||||||||
Originated for sale mortgage volume (2) (B) | $ | 1,061,173 | $ | 1,419,871 | $ | 2,055,919 | $ | 1,712,602 | $ | 1,364,869 | ||||||||||
Gain on sale margin (A)/(B) | 1.47 | % | 1.66 | % | 1.71 | % | 1.58 | % | 1.05 | % |
(1) | Changes due to collection or realization of expected cash flows. |
(2) | Includes change in mortgage rate lock commitments expected to close, change in loans held for sale and loans sold to investors during the period. |
NON-GAAP FINANCIAL INFORMATION |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | ||||||||||||||||
Stockholders' equity - as reported | $ | 2,616,428 | $ | 2,579,209 | $ | 2,563,408 | $ | 2,156,535 | $ | 2,122,885 | ||||||||||
Less goodwill | 999,925 | 1,001,038 | 993,799 | 725,039 | 725,068 | |||||||||||||||
Less other intangible assets, net of tax benefit | 39,565 | 40,923 | 42,507 | 27,020 | 28,071 | |||||||||||||||
Tangible equity | $ | 1,576,938 | $ | 1,537,248 | $ | 1,527,102 | $ | 1,404,476 | $ | 1,369,746 |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | ||||||||||||||||
Total assets - as reported | $ | 19,146,062 | $ | 19,302,317 | $ | 19,341,882 | $ | 15,995,790 | $ | 15,575,653 | ||||||||||
Less goodwill | 999,925 | 1,001,038 | 993,799 | 725,039 | 725,068 | |||||||||||||||
Less other intangible assets, net of tax benefit | 39,565 | 40,923 | 42,507 | 27,020 | 28,071 | |||||||||||||||
Tangible assets | $ | 18,106,572 | $ | 18,260,356 | $ | 18,305,576 | $ | 15,243,731 | $ | 14,822,514 |
3/31/2017 | 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | ||||||||||||||||
Common stockholders' equity - as reported | $ | 2,500,856 | $ | 2,463,637 | $ | 2,446,901 | $ | 2,041,255 | $ | 2,007,605 | ||||||||||
Less goodwill | 999,925 | 1,001,038 | 993,799 | 725,039 | 725,068 | |||||||||||||||
Less other intangible assets, net of tax benefit | 39,565 | 40,923 | 42,507 | 27,020 | 28,071 | |||||||||||||||
Tangible common equity | $ | 1,461,366 | $ | 1,421,676 | $ | 1,410,595 | $ | 1,289,196 | $ | 1,254,466 |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Average common stockholders' equity - as reported | $ | 2,472,771 | $ | 2,441,809 | $ | 2,201,095 | $ | 2,014,822 | $ | 1,984,379 | ||||||||||
Less average goodwill | 1,001,005 | 994,053 | 835,894 | 725,011 | 725,070 | |||||||||||||||
Less average other intangible assets, net of tax benefit | 40,052 | 41,471 | 32,744 | 27,437 | 28,511 | |||||||||||||||
Average tangible common equity | $ | 1,431,714 | $ | 1,406,285 | $ | 1,332,457 | $ | 1,262,374 | $ | 1,230,798 |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Net income available to common stockholders - as reported | $ | 52,534 | $ | 45,186 | $ | 42,415 | $ | 41,412 | $ | 37,114 | ||||||||||
Plus other intangible amortization expense, net of tax benefit | 1,359 | 1,552 | 1,088 | 1,051 | 1,057 | |||||||||||||||
Net cash flow available to common stockholders | $ | 53,893 | $ | 46,738 | $ | 43,503 | $ | 42,463 | $ | 38,171 |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Net income - as reported | $ | 54,537 | $ | 47,191 | $ | 44,419 | $ | 43,412 | $ | 39,114 | ||||||||||
Less non-core items: | ||||||||||||||||||||
Net gain on investment securities | 231 | 178 | — | 269 | — | |||||||||||||||
Net (loss) gain on disposal of other assets | (123 | ) | (749 | ) | 5 | (2 | ) | (48 | ) | |||||||||||
Increase in market value of assets held in trust for deferred compensation - other operating income | 961 | 141 | 711 | 480 | 8 | |||||||||||||||
Merger related and repositioning expenses | (258 | ) | (6,491 | ) | (11,368 | ) | (2,566 | ) | (3,287 | ) | ||||||||||
Branch exit and facilities impairment charges | — | — | — | (155 | ) | — | ||||||||||||||
Contribution to MB Financial Charitable Foundation | — | — | (4,000 | ) | — | — | ||||||||||||||
Increase in market value of assets held in trust for deferred compensation - other operating expense | (961 | ) | (141 | ) | (711 | ) | (480 | ) | (8 | ) | ||||||||||
Total non-core items | (150 | ) | (7,062 | ) | (15,363 | ) | (2,454 | ) | (3,335 | ) | ||||||||||
Income tax expense on non-core items (1) | (1,508 | ) | (2,406 | ) | (6,074 | ) | (1,003 | ) | (577 | ) | ||||||||||
Income tax benefit resulting from early adoption of new stock-based compensation guidance | — | — | (1,793 | ) | — | — | ||||||||||||||
Non-core items, net of tax | 1,358 | (4,656 | ) | (7,496 | ) | (1,451 | ) | (2,758 | ) | |||||||||||
Operating earnings | 53,179 | 51,847 | 51,915 | 44,863 | 41,872 | |||||||||||||||
Dividends on preferred shares | 2,003 | 2,005 | 2,004 | 2,000 | 2,000 | |||||||||||||||
Operating earnings available to common stockholders | $ | 51,176 | $ | 49,842 | $ | 49,911 | $ | 42,863 | $ | 39,872 | ||||||||||
Diluted operating earnings per common share | $ | 0.60 | $ | 0.59 | $ | 0.63 | $ | 0.58 | $ | 0.54 | ||||||||||
Weighted average common shares outstanding for diluted operating earnings per common share | 84,778,130 | 84,674,181 | 78,683,170 | 74,180,374 | 73,966,935 |
(1) | The first quarter of 2017 includes a reversal of a tax liability no longer needed related to one of our acquired entities. |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Non-interest expense | $ | 155,665 | $ | 165,760 | $ | 170,385 | $ | 147,906 | $ | 135,800 | ||||||||||
Less merger related and repositioning expenses | 258 | 6,491 | 11,368 | 2,566 | 3,287 | |||||||||||||||
Less branch exit and facilities impairment charges | — | — | — | 155 | — | |||||||||||||||
Less contribution to MB Financial Charitable Foundation | — | — | 4,000 | — | — | |||||||||||||||
Less increase in market value of assets held in trust for deferred compensation | 961 | 141 | 711 | 480 | 8 | |||||||||||||||
Non-interest expense - as adjusted | $ | 154,446 | $ | 159,128 | $ | 154,306 | $ | 144,705 | $ | 132,505 | ||||||||||
Net interest income | $ | 143,043 | $ | 145,214 | $ | 130,771 | $ | 122,602 | $ | 119,304 | ||||||||||
Tax equivalent adjustment | 6,921 | 7,090 | 7,122 | 7,208 | 7,195 | |||||||||||||||
Net interest income on a fully tax equivalent basis | 149,964 | 152,304 | 137,893 | 129,810 | 126,499 | |||||||||||||||
Plus non-interest income | 91,773 | 92,823 | 108,387 | 92,000 | 81,693 | |||||||||||||||
Plus tax equivalent adjustment on the increase in cash surrender value of life insurance | 694 | 709 | 568 | 458 | 460 | |||||||||||||||
Less net gain on investment securities | 231 | 178 | — | 269 | — | |||||||||||||||
Less net (loss) gain on disposal of other assets | (123 | ) | (749 | ) | 5 | (2 | ) | (48 | ) | |||||||||||
Less increase in market value of assets held in trust for deferred compensation | 961 | 141 | 711 | 480 | 8 | |||||||||||||||
Non-interest income - as adjusted | 91,398 | 93,962 | 108,239 | 91,711 | 82,193 | |||||||||||||||
Total revenue - as adjusted and on a fully tax equivalent basis | $ | 241,362 | $ | 246,266 | $ | 246,132 | $ | 221,521 | $ | 208,692 | ||||||||||
Efficiency ratio | 63.99 | % | 64.62 | % | 62.69 | % | 65.32 | % | 63.49 | % | ||||||||||
Efficiency ratio (without adjustments) | 66.29 | % | 69.64 | % | 71.24 | % | 68.92 | % | 67.56 | % |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Non-interest expense - as adjusted | $ | 154,446 | $ | 159,128 | $ | 154,306 | $ | 144,705 | $ | 132,505 | ||||||||||
Less non-interest income - as adjusted | 91,398 | 93,962 | 108,239 | 91,711 | 82,193 | |||||||||||||||
Net non-interest expense - as adjusted | $ | 63,048 | $ | 65,166 | $ | 46,067 | $ | 52,994 | $ | 50,312 | ||||||||||
Average assets | $ | 19,002,982 | $ | 19,192,747 | $ | 17,248,431 | $ | 15,740,658 | $ | 15,487,565 | ||||||||||
Annualized net non-interest expense to average assets | 1.35 | % | 1.35 | % | 1.06 | % | 1.35 | % | 1.31 | % | ||||||||||
Annualized net non-interest expense to average assets (without adjustments) | 1.36 | % | 1.51 | % | 1.43 | % | 1.43 | % | 1.41 | % |
1Q17 | 4Q16 | 3Q16 | 2Q16 | 1Q16 | ||||||||||||||||
Non-interest income - as adjusted | $ | 91,398 | $ | 93,962 | $ | 108,239 | $ | 91,711 | $ | 82,193 | ||||||||||
Total revenue - as adjusted and on a fully tax equivalent basis | $ | 241,362 | $ | 246,266 | $ | 246,132 | $ | 221,521 | $ | 208,692 | ||||||||||
Core non-interest income to revenues ratio | 37.87 | % | 38.15 | % | 43.98 | % | 41.40 | % | 39.38 | % | ||||||||||
Non-interest income to revenues ratio (without adjustments) | 39.08 | % | 39.00 | % | 45.32 | % | 42.87 | % | 40.64 | % |
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