Delaware | 001-32550 | 88-0365922 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
WESTERN ALLIANCE BANCORPORATION | ||
(Registrant) | ||
/s/ Dale Gibbons | ||
Dale Gibbons | ||
Executive Vice President and | ||
Chief Financial Officer | ||
Date: July 17, 2014 |
• | Net income of $35.5 million, compared to $31.1 million for the first quarter 2014 and $34.1 million for the second quarter 2013 |
• | Earnings per share of $0.40, compared to $0.35 per share in the first quarter 2014 and $0.39 per share in the second quarter 2013 |
• | Accretion of interest yield related to purchased credit impaired loan sales or payoffs increased $1.4 million, net of tax, or $0.02 per share, compared to the first quarter 2014 |
• | Pre-tax, pre-provision operating earnings of $47.4 million, up from $44.4 million in the first quarter 2014 and up 18.1% from $40.1 million in the second quarter 20131 |
• | Net interest margin of 4.39%, compared to 4.41% in the first quarter 2014 and 4.36% in the second quarter 2013 |
• | Total loans of $7.54 billion, up $436 million from March 31, 2014 and up $1.13 billion from June 30, 2013 |
• | Total deposits of $8.47 billion, up $321 million from March 31, 2014 and up $1.47 billion from June 30, 2013 |
• | Nonperforming assets (nonaccrual loans and repossessed assets) decreased to 1.23% of total assets from 1.30% in the first quarter 2014 and from 1.86% in the second quarter 2013 |
• | Net loan recoveries (annualized) to average loans outstanding of 0.09%, compared to 0.02% in the first quarter 2014 and net loan charge-offs to average loans of 0.17% in the second quarter 2013 |
• | Tier I Leverage Capital of 10.0% and Total Risk-Based Capital ratio of 12.4%, compared to 9.9% and 12.4%, respectively, at March 31, 2014 and 9.9% and 12.0%, respectively, at June 30, 2013 |
• | Total equity of $958 million, up $63 million from March 31, 2014 and up $159 million from June 30, 2013 |
• | Tangible book value per share, net of tax, of $9.02, up from $8.32 at March 31, 2014 and up from $7.26 at June 30, 20131 |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||
Summary Consolidated Financial Data | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
At or for the Three Months Ended June 30, | At or for the Six Months Ended June 30, | |||||||||||||||||||||
2014 | 2013 | Change % | 2014 | 2013 | Change % | |||||||||||||||||
Selected Balance Sheet Data: | ||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||
Total assets | $ | 10,023.6 | $ | 8,592.7 | 16.7 | % | ||||||||||||||||
Loans, net of deferred fees | 7,544.5 | 6,411.5 | 17.7 | |||||||||||||||||||
Securities and money market investments | 1,606.7 | 1,313.1 | 22.4 | |||||||||||||||||||
Securities purchased under agreement to resell | — | 134.0 | (100.0 | ) | ||||||||||||||||||
Total deposits | 8,469.5 | 7,001.3 | 21.0 | |||||||||||||||||||
Borrowings | 337.5 | 418.6 | (19.4 | ) | ||||||||||||||||||
Junior subordinated debt | 42.7 | 39.9 | 7.0 | |||||||||||||||||||
Stockholders' equity | 957.7 | 799.3 | 19.8 | |||||||||||||||||||
Selected Income Statement Data: | ||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||
Interest income | $ | 101,973 | $ | 89,285 | 14.2 | % | $ | 200,674 | $ | 172,393 | 16.4 | % | ||||||||||
Interest expense | 8,075 | 7,133 | 13.2 | 15,999 | 14,038 | 14.0 | ||||||||||||||||
Net interest income | 93,898 | 82,152 | 14.3 | 184,675 | 158,355 | 16.6 | ||||||||||||||||
Provision for loan losses | 507 | 3,481 | (85.4 | ) | 4,007 | 8,920 | (55.1 | ) | ||||||||||||||
Net interest income after provision for credit losses | 93,391 | 78,671 | 18.7 | 180,668 | 149,435 | 20.9 | ||||||||||||||||
Non-interest income | 5,773 | 11,762 | (50.9 | ) | 10,608 | 16,561 | (35.9 | ) | ||||||||||||||
Non-interest expense | 52,416 | 48,531 | 8.0 | 102,165 | 95,460 | 7.0 | ||||||||||||||||
Income from continuing operations, before income tax expense | 46,748 | 41,902 | 11.6 | 89,111 | 70,536 | 26.3 | ||||||||||||||||
Income tax expense | 10,706 | 7,661 | 39.7 | 21,330 | 15,448 | 38.1 | ||||||||||||||||
Income from continuing operations | 36,042 | 34,241 | 5.3 | 67,781 | 55,088 | 23.0 | ||||||||||||||||
Loss on discontinued operations, net | (504 | ) | (169 | ) | 198.2 | (1,158 | ) | (131 | ) | 784.0 | ||||||||||||
Net income | $ | 35,538 | $ | 34,072 | 4.3 | % | $ | 66,623 | $ | 54,957 | 21.2 | % | ||||||||||
Diluted net income per common share from continuing operations | $ | 0.41 | $ | 0.39 | 5.1 | % | $ | 0.77 | $ | 0.63 | 22.2 | % | ||||||||||
Diluted net loss per common share from discontinued operations, net of tax | $ | (0.01 | ) | $ | — | $ | (0.01 | ) | $ | — | ||||||||||||
Diluted net income per common share | $ | 0.40 | $ | 0.39 | 2.6 | % | $ | 0.76 | $ | 0.63 | 20.6 | % | ||||||||||
Common Share Data: | ||||||||||||||||||||||
Diluted net income per common share | $ | 0.40 | $ | 0.39 | 2.6 | % | $ | 0.76 | $ | 0.63 | 20.6 | % | ||||||||||
Book value per common share | $ | 9.30 | $ | 7.57 | 22.9 | % | ||||||||||||||||
Tangible book value per share, net of tax (1) | $ | 9.02 | $ | 7.26 | 24.2 | % | ||||||||||||||||
Average shares outstanding (in thousands): | ||||||||||||||||||||||
Basic | 86,501 | 85,659 | 1.0 | 86,379 | 85,493 | 1.0 | ||||||||||||||||
Diluted | 87,333 | 86,524 | 0.9 | 87,229 | 86,254 | 1.1 | ||||||||||||||||
Common shares outstanding | 87,774 | 86,997 | 0.9 | |||||||||||||||||||
(1) See Reconciliation of Non-GAAP Financial Measures. |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||
Summary Consolidated Financial Data (continued) | ||||||||||||||||||
Unaudited | ||||||||||||||||||
At or for the Three Months Ended June 30, | At or for the Six Months Ended June 30, | |||||||||||||||||
2014 | 2013 | Change % | 2014 | 2013 | Change % | |||||||||||||
(in thousands, except per share data) | ||||||||||||||||||
Selected Performance Ratios: | ||||||||||||||||||
Return on average assets (1) | 1.46 | % | 1.62 | % | (9.9 | )% | 1.39 | % | 1.35 | % | 3.0 | % | ||||||
Return on average tangible common equity (2) | 17.41 | 21.41 | (18.7 | ) | 16.77 | 17.66 | (5.0 | ) | ||||||||||
Net interest margin (1) | 4.39 | 4.36 | 0.7 | 4.40 | 4.36 | 0.9 | ||||||||||||
Net interest spread | 4.26 | 4.22 | 0.9 | 4.27 | 4.21 | 1.4 | ||||||||||||
Efficiency ratio - tax equivalent basis (2) | 49.42 | 52.21 | (5.3 | ) | ||||||||||||||
Loan to deposit ratio | 89.08 | 91.58 | (2.7 | ) | ||||||||||||||
Capital Ratios: | ||||||||||||||||||
Tangible equity (2) | 9.3 | % | 9.0 | % | 3.3 | % | ||||||||||||
Tangible common equity (2) | 7.9 | 7.4 | 6.8 | |||||||||||||||
Tier 1 common equity (2) | 9.0 | 8.3 | 8.4 | |||||||||||||||
Tier 1 Leverage ratio (3) | 10.0 | 9.9 | 1.0 | |||||||||||||||
Tier 1 Risk Based Capital (3) | 11.2 | 10.8 | 3.7 | |||||||||||||||
Total Risk Based Capital (3) | 12.4 | 12.0 | 3.3 | |||||||||||||||
Asset Quality Ratios: | ||||||||||||||||||
Net (recoveries) charge-offs to average loans outstanding (1) | (0.09 | )% | 0.17 | % | (152.9 | )% | (0.05 | )% | 0.27 | % | (118.5 | )% | ||||||
Nonaccrual loans to gross loans | 0.85 | 1.29 | (34.1 | ) | ||||||||||||||
Nonaccrual loans and repossessed assets to total assets | 1.23 | 1.86 | (33.9 | ) | ||||||||||||||
Loans past due 90 days and still accruing to total loans | 0.04 | 0.06 | (33.3 | ) | ||||||||||||||
Allowance for credit losses to loans | 1.40 | 1.50 | (6.7 | ) | ||||||||||||||
Allowance for credit losses to nonaccrual loans | 164.64 | 116.19 | 41.7 | |||||||||||||||
(1) Annualized for the three and six month periods ended June 30, 2014 and 2013. | ||||||||||||||||||
(2) See Reconciliation of Non-GAAP Financial Measures. | ||||||||||||||||||
(3) Capital ratios are preliminary until the Call Reports are filed. |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||
Condensed Consolidated Income Statements | ||||||||||||||||
Unaudited | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Interest income: | (dollars in thousands) | |||||||||||||||
Loans | $ | 90,583 | $ | 81,093 | $ | 177,387 | $ | 155,818 | ||||||||
Investment securities | 10,894 | 7,822 | 22,219 | 15,980 | ||||||||||||
Federal funds sold and other | 496 | 370 | 1,068 | 595 | ||||||||||||
Total interest income | 101,973 | 89,285 | 200,674 | 172,393 | ||||||||||||
Interest expense: | ||||||||||||||||
Deposits | 4,930 | 3,929 | 9,595 | 7,661 | ||||||||||||
Borrowings | 2,702 | 2,749 | 5,540 | 5,456 | ||||||||||||
Junior subordinated debt | 443 | 455 | 864 | 921 | ||||||||||||
Total interest expense | 8,075 | 7,133 | 15,999 | 14,038 | ||||||||||||
Net interest income | 93,898 | 82,152 | 184,675 | 158,355 | ||||||||||||
Provision for credit losses | 507 | 3,481 | 4,007 | 8,920 | ||||||||||||
Net interest income after provision for credit losses | 93,391 | 78,671 | 180,668 | 149,435 | ||||||||||||
Non-interest income: | ||||||||||||||||
Service charges | 2,737 | 2,449 | 5,267 | 4,983 | ||||||||||||
Bank owned life insurance | 959 | 1,036 | 1,908 | 2,072 | ||||||||||||
(Losses) gains on sales of investment securities, net | (163 | ) | (5 | ) | 203 | 143 | ||||||||||
Unrealized gains (losses) on assets/liabilities measured at fair value, net | 235 | (3,290 | ) | (1,041 | ) | (3,761 | ) | |||||||||
Bargain purchase gain from acquisition | — | 10,044 | — | 10,044 | ||||||||||||
Other | 2,005 | 1,528 | 4,271 | 3,080 | ||||||||||||
Total non-interest income | 5,773 | 11,762 | 10,608 | 16,561 | ||||||||||||
Non-interest expenses: | ||||||||||||||||
Salaries and employee benefits | 31,751 | 28,100 | 61,306 | 54,675 | ||||||||||||
Occupancy | 4,328 | 4,753 | 9,010 | 9,599 | ||||||||||||
Legal, professional and directors' fees | 4,192 | 2,549 | 7,831 | 5,572 | ||||||||||||
Insurance | 2,087 | 2,096 | 4,480 | 4,466 | ||||||||||||
Data processing | 2,401 | 2,175 | 5,075 | 4,040 | ||||||||||||
Marketing | 506 | 710 | 1,065 | 1,378 | ||||||||||||
Loan and repossessed asset expenses | 927 | 721 | 2,161 | 2,317 | ||||||||||||
Customer service | 708 | 717 | 1,328 | 1,360 | ||||||||||||
Net loss (gain) on sales and valuations of repossessed and other assets | 184 | (1,124 | ) | (2,363 | ) | (605 | ) | |||||||||
Intangible amortization | 302 | 597 | 899 | 1,194 | ||||||||||||
Merger / restructure expense | 26 | 2,620 | 183 | 2,815 | ||||||||||||
Other | 5,004 | 4,617 | 11,190 | 8,649 | ||||||||||||
Total non-interest expense | 52,416 | 48,531 | 102,165 | 95,460 | ||||||||||||
Income from continuing operations before income taxes | 46,748 | 41,902 | 89,111 | 70,536 | ||||||||||||
Income tax expense | 10,706 | 7,661 | 21,330 | 15,448 | ||||||||||||
Income from continuing operations | $ | 36,042 | $ | 34,241 | $ | 67,781 | $ | 55,088 | ||||||||
Loss from discontinued operations net of tax benefit | (504 | ) | (169 | ) | (1,158 | ) | (131 | ) | ||||||||
Net income | $ | 35,538 | $ | 34,072 | $ | 66,623 | $ | 54,957 | ||||||||
Preferred stock dividends | 352 | 353 | 705 | 705 | ||||||||||||
Net income available to common stockholders | $ | 35,186 | $ | 33,719 | $ | 65,918 | $ | 54,252 | ||||||||
Diluted net income per share | $ | 0.40 | $ | 0.39 | $ | 0.76 | $ | 0.63 |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||
Five Quarter Condensed Consolidated Income Statements | ||||||||||||||||||||
Unaudited | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | ||||||||||||||||
(in thousands, except per share data) | ||||||||||||||||||||
Interest income: | ||||||||||||||||||||
Loans | $ | 90,583 | $ | 86,804 | $ | 86,902 | $ | 83,994 | $ | 81,093 | ||||||||||
Investment securities | 10,894 | 11,325 | 10,137 | 8,286 | 7,822 | |||||||||||||||
Federal funds sold and other | 496 | 572 | 543 | 400 | 370 | |||||||||||||||
Total interest income | 101,973 | 98,701 | 97,582 | 92,680 | 89,285 | |||||||||||||||
Interest expense: | ||||||||||||||||||||
Deposits | 4,930 | 4,665 | 4,442 | 4,232 | 3,929 | |||||||||||||||
Borrowings | 2,702 | 2,838 | 2,717 | 3,429 | 2,749 | |||||||||||||||
Junior subordinated debt | 443 | 421 | 442 | 460 | 455 | |||||||||||||||
Total interest expense | 8,075 | 7,924 | 7,601 | 8,121 | 7,133 | |||||||||||||||
Net interest income | 93,898 | 90,777 | 89,981 | 84,559 | 82,152 | |||||||||||||||
Provision for credit losses | 507 | 3,500 | 4,300 | — | 3,481 | |||||||||||||||
Net interest income after provision for credit losses | 93,391 | 87,277 | 85,681 | 84,559 | 78,671 | |||||||||||||||
Non-interest income: | ||||||||||||||||||||
Service charges | 2,737 | 2,530 | 2,512 | 2,425 | 2,449 | |||||||||||||||
Bank owned life insurance | 959 | 949 | 905 | 1,832 | 1,036 | |||||||||||||||
(Losses) gains on sales of investment securities, net | (163 | ) | 366 | 342 | (1,679 | ) | (5 | ) | ||||||||||||
Unrealized gains (losses) on assets/liabilities measured at fair value, net | 235 | (1,276 | ) | (2,618 | ) | (7 | ) | (3,290 | ) | |||||||||||
Loss on extinguishment of debt | — | — | (1,387 | ) | — | — | ||||||||||||||
Bargain purchase gain from acquisition | — | — | — | — | 10,044 | |||||||||||||||
Other | 2,005 | 2,266 | 1,803 | 1,558 | 1,528 | |||||||||||||||
Total non-interest income | 5,773 | 4,835 | 1,557 | 4,129 | 11,762 | |||||||||||||||
Non-interest expenses: | ||||||||||||||||||||
Salaries and employee benefits | 31,751 | 29,555 | 30,071 | 28,689 | 28,100 | |||||||||||||||
Occupancy | 4,328 | 4,682 | 4,626 | 4,901 | 4,753 | |||||||||||||||
Legal, professional and directors' fees | 4,192 | 3,639 | 4,623 | 3,438 | 2,549 | |||||||||||||||
Insurance | 2,087 | 2,393 | 1,744 | 1,884 | 2,096 | |||||||||||||||
Data processing | 2,401 | 2,674 | 2,040 | 1,872 | 2,175 | |||||||||||||||
Marketing | 506 | 559 | 619 | 585 | 710 | |||||||||||||||
Loan and repossessed asset expenses | 927 | 1,234 | 793 | 1,136 | 721 | |||||||||||||||
Customer service | 708 | 620 | 860 | 677 | 717 | |||||||||||||||
Net loss (gain) on sales and valuations of repossessed and other assets | 184 | (2,547 | ) | (2,153 | ) | 371 | (1,124 | ) | ||||||||||||
Intangible amortization | 302 | 597 | 597 | 597 | 597 | |||||||||||||||
Merger / restructure expense | 26 | 157 | 1,919 | 1,018 | 2,620 | |||||||||||||||
Other | 5,004 | 6,186 | 5,392 | 4,507 | 4,617 | |||||||||||||||
Total non-interest expense | 52,416 | 49,749 | 51,131 | 49,675 | 48,531 | |||||||||||||||
Income from continuing operations before income taxes | 46,748 | 42,363 | 36,107 | 39,013 | 41,902 | |||||||||||||||
Income tax expense | 10,706 | 10,624 | 3,992 | 10,390 | 7,661 | |||||||||||||||
Income from continuing operations | $ | 36,042 | $ | 31,739 | $ | 32,115 | $ | 28,623 | $ | 34,241 | ||||||||||
Loss from discontinued operations, net of tax | (504 | ) | (654 | ) | (701 | ) | (29 | ) | (169 | ) | ||||||||||
Net income | $ | 35,538 | $ | 31,085 | $ | 31,414 | $ | 28,594 | $ | 34,072 | ||||||||||
Preferred stock dividends | 352 | 353 | 352 | 352 | 353 | |||||||||||||||
Net income available to common stockholders | $ | 35,186 | $ | 30,732 | $ | 31,062 | $ | 28,242 | $ | 33,719 | ||||||||||
Diluted net income per share | $ | 0.40 | $ | 0.35 | $ | 0.36 | $ | 0.33 | $ | 0.39 |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||
Five Quarter Condensed Consolidated Balance Sheets | ||||||||||||||||||||
Unaudited | ||||||||||||||||||||
Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | ||||||||||||||||
(in millions) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Cash and due from banks | $ | 379.3 | $ | 354.8 | $ | 305.5 | $ | 380.9 | $ | 248.9 | ||||||||||
Securities purchased under agreement to resell | — | 111.1 | — | 128.1 | 134.0 | |||||||||||||||
Cash and cash equivalents | 379.3 | 465.9 | 305.5 | 509.0 | 382.9 | |||||||||||||||
Securities and money market investments | 1,606.7 | 1,671.2 | 1,689.6 | 1,370.8 | 1,313.1 | |||||||||||||||
Loans held for sale | — | — | — | 25.4 | 27.6 | |||||||||||||||
Loans held for investment: | ||||||||||||||||||||
Commercial | 3,027.7 | 2,723.4 | 2,478.2 | 2,234.9 | 2,174.1 | |||||||||||||||
Commercial real estate - non-owner occupied | 1,940.0 | 1,849.2 | 1,841.1 | 1,864.3 | 1,839.7 | |||||||||||||||
Commercial real estate - owner occupied | 1,605.0 | 1,606.2 | 1,561.9 | 1,551.2 | 1,550.0 | |||||||||||||||
Construction and land development | 612.4 | 553.7 | 535.7 | 459.8 | 416.7 | |||||||||||||||
Residential real estate | 328.1 | 344.9 | 350.3 | 359.0 | 381.7 | |||||||||||||||
Consumer | 40.9 | 38.3 | 43.1 | 29.8 | 28.5 | |||||||||||||||
Deferred fees, net | (9.6 | ) | (7.1 | ) | (8.9 | ) | (8.1 | ) | (6.8 | ) | ||||||||||
Gross loans and deferred fees, net | 7,544.5 | 7,108.6 | 6,801.4 | 6,490.9 | 6,383.9 | |||||||||||||||
Allowance for credit losses | (105.9 | ) | (103.9 | ) | (100.1 | ) | (97.9 | ) | (96.3 | ) | ||||||||||
Loans, net | 7,438.6 | 7,004.7 | 6,701.3 | 6,393.0 | 6,287.6 | |||||||||||||||
Premises and equipment, net | 109.6 | 106.6 | 105.6 | 105.9 | 106.1 | |||||||||||||||
Other repossessed assets | 59.3 | 56.5 | 66.7 | 76.5 | 76.5 | |||||||||||||||
Bank owned life insurance | 142.5 | 141.5 | 140.6 | 139.7 | 140.4 | |||||||||||||||
Goodwill and other intangibles, net | 26.5 | 26.8 | 27.4 | 28.0 | 28.6 | |||||||||||||||
Other assets | 261.1 | 273.4 | 270.7 | 272.2 | 229.9 | |||||||||||||||
Total assets | $ | 10,023.6 | $ | 9,746.6 | $ | 9,307.4 | $ | 8,920.5 | $ | 8,592.7 | ||||||||||
Liabilities and Stockholders' Equity: | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
Non-interest bearing demand deposits | $ | 2,278.8 | $ | 2,093.6 | $ | 2,200.0 | $ | 1,972.5 | $ | 1,919.6 | ||||||||||
Interest bearing: | ||||||||||||||||||||
Demand | 794.8 | 750.4 | 709.8 | 673.7 | 631.3 | |||||||||||||||
Savings and money market | 3,637.4 | 3,672.3 | 3,310.4 | 3,050.0 | 2,945.1 | |||||||||||||||
Time certificates | 1,758.5 | 1,632.7 | 1,618.0 | 1,579.1 | 1,505.3 | |||||||||||||||
Total deposits | 8,469.5 | 8,149.0 | 7,838.2 | 7,275.3 | 7,001.3 | |||||||||||||||
Customer repurchase agreements | 53.7 | 57.4 | 71.2 | 55.5 | 51.9 | |||||||||||||||
Total customer funds | 8,523.2 | 8,206.4 | 7,909.4 | 7,330.8 | 7,053.2 | |||||||||||||||
Securities sold short | — | 109.8 | — | 126.6 | 129.5 | |||||||||||||||
Borrowings | 337.5 | 342.8 | 341.1 | 394.1 | 418.6 | |||||||||||||||
Junior subordinated debt | 42.7 | 42.8 | 41.9 | 39.4 | 39.9 | |||||||||||||||
Accrued interest payable and other liabilities | 162.5 | 150.0 | 159.5 | 203.1 | 152.2 | |||||||||||||||
Total liabilities | 9,065.9 | 8,851.8 | 8,451.9 | 8,094.0 | 7,793.4 | |||||||||||||||
Stockholders' Equity | ||||||||||||||||||||
Common stock and additional paid-in capital | 803.4 | 795.3 | 797.2 | 792.2 | 789.5 | |||||||||||||||
Preferred stock | 141.0 | 141.0 | 141.0 | 141.0 | 141.0 | |||||||||||||||
Retained earnings (accumulated deficit) | 4.8 | (30.4 | ) | (61.2 | ) | (92.2 | ) | (120.4 | ) | |||||||||||
Accumulated other comprehensive income (loss) | 8.5 | (11.1 | ) | (21.5 | ) | (14.5 | ) | (10.8 | ) | |||||||||||
Total stockholders' equity | 957.7 | 894.8 | 855.5 | 826.5 | 799.3 | |||||||||||||||
Total liabilities and stockholders' equity | $ | 10,023.6 | $ | 9,746.6 | $ | 9,307.4 | $ | 8,920.5 | $ | 8,592.7 |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||
Changes in the Allowance For Credit Losses | ||||||||||||||||||||
Unaudited | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Balance, beginning of period | $ | 103,899 | $ | 100,050 | $ | 97,851 | $ | 96,323 | $ | 95,494 | ||||||||||
Provision for credit losses | 507 | 3,500 | 4,300 | — | 3,481 | |||||||||||||||
Recoveries of loans previously charged-off: | ||||||||||||||||||||
Commercial and industrial | 1,254 | 922 | 666 | 2,242 | 1,757 | |||||||||||||||
Commercial real estate - non-owner occupied | 1,052 | 83 | 395 | 273 | 154 | |||||||||||||||
Commercial real estate - owner occupied | 196 | 477 | 297 | 149 | 479 | |||||||||||||||
Construction and land development | 498 | 211 | 273 | 966 | 120 | |||||||||||||||
Residential real estate | 314 | 553 | 549 | 430 | 549 | |||||||||||||||
Consumer | 191 | 170 | 179 | 726 | 11 | |||||||||||||||
Total recoveries | 3,505 | 2,416 | 2,359 | 4,786 | 3,070 | |||||||||||||||
Loans charged-off: | ||||||||||||||||||||
Commercial and industrial | 1,039 | 1,478 | 621 | 544 | 1,065 | |||||||||||||||
Commercial real estate - non-owner occupied | 99 | 160 | 2,268 | 466 | 1,000 | |||||||||||||||
Commercial real estate - owner occupied | 230 | 11 | 238 | 398 | 1,391 | |||||||||||||||
Construction and land development | 78 | — | 686 | — | 238 | |||||||||||||||
Residential real estate | 523 | 406 | 281 | 1,138 | 2,010 | |||||||||||||||
Consumer | 5 | 12 | 366 | 712 | 18 | |||||||||||||||
Total loans charged-off | 1,974 | 2,067 | 4,460 | 3,258 | 5,722 | |||||||||||||||
Net loan (recoveries) charge-offs | (1,531 | ) | (349 | ) | 2,101 | (1,528 | ) | 2,652 | ||||||||||||
Balance, end of period | $ | 105,937 | $ | 103,899 | $ | 100,050 | $ | 97,851 | $ | 96,323 | ||||||||||
Net (recoveries) charge-offs to average loans outstanding - annualized | (0.09 | )% | (0.02 | )% | 0.13 | % | (0.10 | )% | 0.17 | % | ||||||||||
Allowance for credit losses to gross loans | 1.40 | 1.46 | 1.47 | 1.50 | 1.50 | |||||||||||||||
Nonaccrual loans | $ | 64,343 | $ | 70,401 | $ | 75,681 | $ | 76,641 | $ | 82,899 | ||||||||||
Repossessed assets | 59,292 | 56,450 | 66,719 | 76,475 | 76,499 | |||||||||||||||
Loans past due 90 days, still accruing | 3,001 | 167 | 1,534 | 5,456 | 3,893 | |||||||||||||||
Loans past due 30 to 89 days, still accruing | 5,123 | 11,087 | 13,425 | 8,689 | 7,341 | |||||||||||||||
Classified loans on accrual | 133,220 | 125,903 | 128,586 | 144,041 | 140,192 | |||||||||||||||
Special mention loans | 90,534 | 117,540 | 129,965 | 137,247 | 162,482 |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||
Analysis of Average Balances, Yields and Rates | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||
Average Balance | Interest | Average Yield/ Cost | Average Balance | Interest | Average Yield/ Cost | |||||||||||||||||
($ in millions) | ($ in thousands) | ($ in millions) | ($ in thousands) | |||||||||||||||||||
Interest earning assets | ||||||||||||||||||||||
Loans (1) | $ | 7,178.3 | $ | 90,583 | 5.29 | % | $ | 6,100.8 | $ | 81,093 | 5.40 | % | ||||||||||
Securities (1) | 1,629.9 | 10,894 | 3.08 | 1,295.9 | 7,822 | 2.92 | ||||||||||||||||
Federal funds sold and other | 292.4 | 496 | 0.68 | 407.7 | 370 | 0.36 | ||||||||||||||||
Total interest earning assets | 9,100.6 | 101,973 | 4.75 | 7,804.4 | 89,285 | 4.73 | ||||||||||||||||
Non-interest earning assets | ||||||||||||||||||||||
Cash and due from banks | 138.7 | 119.2 | ||||||||||||||||||||
Allowance for credit losses | (105.0 | ) | (96.6 | ) | ||||||||||||||||||
Bank owned life insurance | 141.8 | 139.7 | ||||||||||||||||||||
Other assets | 462.0 | 432.7 | ||||||||||||||||||||
Total assets | $ | 9,738.1 | $ | 8,399.4 | ||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||
Interest-bearing transaction accounts | $ | 791.5 | $ | 385 | 0.19 | % | $ | 626.8 | $ | 370 | 0.24 | % | ||||||||||
Savings and money market | 3,583.5 | 2,691 | 0.30 | 2,768.7 | 2,007 | 0.29 | ||||||||||||||||
Time certificates of deposit | 1,700.4 | 1,854 | 0.44 | 1,584.0 | 1,552 | 0.39 | ||||||||||||||||
Total interest-bearing deposits | 6,075.4 | 4,930 | 0.32 | 4,979.5 | 3,929 | 0.32 | ||||||||||||||||
Short-term borrowings | 236.2 | 216 | 0.37 | 188.8 | 214 | 0.45 | ||||||||||||||||
Long-term debt | 280.4 | 2,486 | 3.55 | 365.2 | 2,535 | 2.78 | ||||||||||||||||
Junior subordinated debt | 42.8 | 443 | 4.14 | 36.7 | 455 | 4.96 | ||||||||||||||||
Total interest-bearing liabilities | 6,634.8 | 8,075 | 0.49 | 5,570.2 | 7,133 | 0.51 | ||||||||||||||||
Non-interest-bearing liabilities | ||||||||||||||||||||||
Non-interest-bearing demand deposits | 2,045.5 | 1,898.2 | ||||||||||||||||||||
Other liabilities | 126.7 | 124.6 | ||||||||||||||||||||
Stockholders’ equity | 931.1 | 806.4 | ||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 9,738.1 | $ | 8,399.4 | ||||||||||||||||||
Net interest income and margin | $ | 93,898 | 4.39 | % | $ | 82,152 | 4.36 | % | ||||||||||||||
Net interest spread | 4.26 | % | 4.22 | % | ||||||||||||||||||
(1) Yields on loans and securities have been adjusted to a tax equivalent basis. The taxable-equivalent adjustment was $6,029 and $2,929 for the three months ended June 30, 2014 and 2013, respectively. |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||
Analysis of Average Balances, Yields and Rates | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||
Average Balance | Interest | Average Yield/ Cost | Average Balance | Interest | Average Yield/ Cost | |||||||||||||||||
($ in millions) | ($ in thousands) | ($ in millions) | ($ in thousands) | |||||||||||||||||||
Interest earning assets | ||||||||||||||||||||||
Loans (1) | $ | 7,036.5 | $ | 177,387 | 5.28 | % | $ | 5,857.0 | $ | 155,818 | 5.41 | % | ||||||||||
Securities (1) | 1,640.8 | 22,219 | 3.11 | 1,289.7 | 15,980 | 3.06 | ||||||||||||||||
Federal funds sold & other | 251.6 | 1,068 | 0.85 | 406.2 | 595 | 0.29 | ||||||||||||||||
Total interest earnings assets | 8,928.9 | 200,674 | 4.76 | 7,552.9 | 172,393 | 4.73 | ||||||||||||||||
Non-interest earning assets | ||||||||||||||||||||||
Cash and due from banks | 138.1 | 122.9 | ||||||||||||||||||||
Allowance for credit losses | (103.1 | ) | (96.8 | ) | ||||||||||||||||||
Bank owned life insurance | 141.4 | 139.2 | ||||||||||||||||||||
Other assets | 447.6 | 427.3 | ||||||||||||||||||||
Total assets | $ | 9,552.9 | $ | 8,145.5 | ||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||
Interest bearing transaction accounts | $ | 778.3 | $ | 768 | 0.20 | % | $ | 617.8 | $ | 671 | 0.22 | % | ||||||||||
Savings and money market | 3,518.3 | 5,254 | 0.30 | 2,695.2 | 3,918 | 0.29 | ||||||||||||||||
Time certificates of deposits | 1,660.2 | 3,573 | 0.43 | 1,517.1 | 3,072 | 0.40 | ||||||||||||||||
Total interest-bearing deposits | 5,956.8 | 9,595 | 0.32 | 4,830.1 | 7,661 | 0.32 | ||||||||||||||||
Short-term borrowings | 201.8 | 345 | 0.34 | 183.0 | 428 | 0.47 | ||||||||||||||||
Long-term debt | 291.0 | 5,195 | 3.57 | 319.2 | 5,028 | 3.15 | ||||||||||||||||
Junior subordinated debt | 42.4 | 864 | 4.08 | 36.5 | 921 | 5.05 | ||||||||||||||||
Total interest-bearing liabilities | 6,492.0 | 15,999 | 0.49 | 5,368.8 | 14,038 | 0.52 | ||||||||||||||||
Non-interest-bearing liabilities | ||||||||||||||||||||||
Non-interest-bearing demand deposits | 2,049.8 | 1,876.8 | ||||||||||||||||||||
Other liabilities | 102.3 | 107.4 | ||||||||||||||||||||
Stockholders’ equity | 908.8 | 792.5 | ||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 9,552.9 | $ | 8,145.5 | ||||||||||||||||||
Net interest income and margin | $ | 184,675 | 4.40 | % | $ | 158,355 | 4.36 | % | ||||||||||||||
Net interest spread | 4.27 | % | 4.21 | % | ||||||||||||||||||
(1) Yields on loans and securities have been adjusted to a tax equivalent basis. The taxable-equivalent adjustment was $11,734 and $6,311 for the six months ended June 30, 2014 and 2013, respectively. |
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||||
Operating Segment Results | ||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||
Arizona | Nevada | California | National Business Lines | Corporate & Other | Consolidated Company | |||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||
As of June 30, 2014: | ||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Cash, cash equivalents and investment securities | $ | 3.0 | $ | 7.0 | $ | 2.4 | $ | — | $ | 1,973.6 | $ | 1,986.0 | ||||||||||||
Gross loans and deferred fees, net | 2,131.0 | 1,682.6 | 1,694.8 | 1,951.5 | 84.6 | 7,544.5 | ||||||||||||||||||
Less: allowance for credit losses | (29.9 | ) | (23.6 | ) | (23.8 | ) | (27.4 | ) | (1.2 | ) | (105.9 | ) | ||||||||||||
Loans, net | 2,101.1 | 1,659.0 | 1,671.0 | 1,924.1 | 83.4 | 7,438.6 | ||||||||||||||||||
Other repossessed assets | 13.1 | 24.1 | — | — | 22.1 | 59.3 | ||||||||||||||||||
Goodwill and intangible assets, net | — | 26.5 | — | — | — | 26.5 | ||||||||||||||||||
Other assets | 42.2 | 62.7 | 26.2 | 21.1 | 361.0 | 513.2 | ||||||||||||||||||
Total assets | $ | 2,159.4 | $ | 1,779.3 | $ | 1,699.6 | $ | 1,945.2 | $ | 2,440.1 | $ | 10,023.6 | ||||||||||||
Liabilities: | ||||||||||||||||||||||||
Deposits (1) | $ | 2,115.4 | $ | 3,187.8 | $ | 2,061.1 | $ | 886.3 | $ | 218.9 | $ | 8,469.5 | ||||||||||||
Borrowings | — | — | — | — | 337.5 | 337.5 | ||||||||||||||||||
Other liabilities | 20.9 | 46.8 | 4.8 | 24.7 | 161.7 | 258.9 | ||||||||||||||||||
Total liabilities | 2,136.3 | 3,234.6 | 2,065.9 | 911.0 | 718.1 | 9,065.9 | ||||||||||||||||||
Allocated equity | 233.7 | 212.5 | 188.7 | 152.3 | 170.5 | 957.7 | ||||||||||||||||||
Liabilities and stockholders' equity | $ | 2,370.0 | $ | 3,447.1 | $ | 2,254.6 | $ | 1,063.3 | $ | 888.6 | $ | 10,023.6 | ||||||||||||
Excess funds provided (used) | 208.6 | 1,670.0 | 555.1 | (882.2 | ) | (1,551.5 | ) | — | ||||||||||||||||
No. of branches | 10 | 18 | 11 | — | — | 39 | ||||||||||||||||||
No. of full-time equivalent employees | 212 | 305 | 218 | 92 | 285 | 1,112 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Three Months Ended June 30, 2014: | ||||||||||||||||||||||||
Net interest income (expense) | $ | 29,211 | $ | 29,359 | $ | 24,702 | $ | 16,226 | $ | (5,600 | ) | $ | 93,898 | |||||||||||
Provision for (recovery of) credit losses | 3 | (2,011 | ) | (1,672 | ) | 3,467 | 720 | 507 | ||||||||||||||||
Net interest income (expense) after provision for credit losses | 29,208 | 31,370 | 26,374 | 12,759 | (6,320 | ) | 93,391 | |||||||||||||||||
Non-interest income | 934 | 2,352 | 970 | 643 | 874 | 5,773 | ||||||||||||||||||
Non-interest expense | (12,793 | ) | (16,026 | ) | (13,342 | ) | (6,640 | ) | (3,615 | ) | (52,416 | ) | ||||||||||||
Income (loss) from continuing operations before income taxes | 17,349 | 17,696 | 14,002 | 6,762 | (9,061 | ) | 46,748 | |||||||||||||||||
Income tax expense (benefit) | 6,805 | 6,194 | 5,887 | 2,536 | (10,716 | ) | 10,706 | |||||||||||||||||
Income from continuing operations | 10,544 | 11,502 | 8,115 | 4,226 | 1,655 | 36,042 | ||||||||||||||||||
Loss from discontinued operations, net | — | — | — | — | (504 | ) | (504 | ) | ||||||||||||||||
Net income | $ | 10,544 | $ | 11,502 | $ | 8,115 | $ | 4,226 | $ | 1,151 | $ | 35,538 | ||||||||||||
(in thousands) | ||||||||||||||||||||||||
Six Months Ended June 30, 2014: | ||||||||||||||||||||||||
Net interest income (expense) | $ | 55,819 | $ | 57,954 | $ | 47,494 | $ | 30,190 | $ | (6,782 | ) | $ | 184,675 | |||||||||||
Provision for (recovery of) credit losses | 1,561 | (2,895 | ) | (1,017 | ) | 5,637 | 721 | 4,007 | ||||||||||||||||
Net interest income (expense) after provision for credit losses | 54,258 | 60,849 | 48,511 | 24,553 | (7,503 | ) | 180,668 | |||||||||||||||||
Non-interest income | 1,754 | 4,641 | 2,220 | 725 | 1,268 | 10,608 | ||||||||||||||||||
Non-interest expense | (26,097 | ) | (31,262 | ) | (26,385 | ) | (13,148 | ) | (5,273 | ) | (102,165 | ) | ||||||||||||
Income (loss) from continuing operations before income taxes | 29,915 | 34,228 | 24,346 | 12,130 | (11,508 | ) | 89,111 | |||||||||||||||||
Income tax expense (benefit) | 11,734 | 11,981 | 10,237 | 4,549 | (17,171 | ) | 21,330 | |||||||||||||||||
Income from continuing operations | 18,181 | 22,247 | 14,109 | 7,581 | 5,663 | 67,781 | ||||||||||||||||||
Loss from discontinued operations, net | — | — | — | — | (1,158 | ) | (1,158 | ) | ||||||||||||||||
Net income | $ | 18,181 | $ | 22,247 | $ | 14,109 | $ | 7,581 | $ | 4,505 | $ | 66,623 | ||||||||||||
(1) Certain centrally-managed deposits from prior periods were re-allocated to specific regions to conform to current presentation. |
Western Alliance Bancorporation and Subsidiaries | |||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures (Unaudited) | |||||||||||||||||||
Pre-Tax, Pre-Provision Operating Earnings by Quarter | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | |||||||||||||||
(in thousands) | |||||||||||||||||||
Total non-interest income | $ | 5,773 | $ | 4,835 | $ | 1,557 | $ | 4,129 | $ | 11,762 | |||||||||
Less: | |||||||||||||||||||
(Losses) gains on sales of investment securities, net | (163 | ) | 366 | 342 | (1,679 | ) | (5 | ) | |||||||||||
Unrealized losses on assets/liabilities measured at fair value, net | 235 | (1,276 | ) | (2,618 | ) | (7 | ) | (3,290 | ) | ||||||||||
Loss on extinguishment of debt | — | — | (1,387 | ) | — | — | |||||||||||||
Bargain purchase gain from acquisition | — | — | — | — | 10,044 | ||||||||||||||
Total operating non-interest income | 5,701 | 5,745 | 5,220 | 5,815 | 5,013 | ||||||||||||||
Add: net interest income | 93,898 | 90,777 | 89,981 | 84,559 | 82,152 | ||||||||||||||
Net operating revenue (1) | $ | 99,599 | $ | 96,522 | $ | 95,201 | $ | 90,374 | $ | 87,165 | |||||||||
Total non-interest expense | $ | 52,416 | $ | 49,749 | $ | 51,131 | $ | 49,675 | $ | 48,531 | |||||||||
Less: | |||||||||||||||||||
Net loss (gain) on sales and valuations of repossessed and other assets | 184 | (2,547 | ) | (2,153 | ) | 371 | (1,124 | ) | |||||||||||
Merger / restructure expense | 26 | 157 | 1,919 | 1,018 | 2,620 | ||||||||||||||
Total operating non-interest expense (1) | $ | 52,206 | $ | 52,139 | $ | 51,365 | $ | 48,286 | $ | 47,035 | |||||||||
Pre-tax, pre-provision operating earnings (2) | $ | 47,393 | $ | 44,383 | $ | 43,836 | $ | 42,088 | $ | 40,130 |
Tangible Common Equity | |||||||||||||||||||
Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | |||||||||||||||
(dollars and shares in thousands) | |||||||||||||||||||
Total stockholders' equity | $ | 957,664 | $ | 894,804 | $ | 855,498 | $ | 826,472 | $ | 799,307 | |||||||||
Less: | |||||||||||||||||||
Goodwill and intangible assets, net | 26,475 | 26,777 | 27,374 | 27,970 | 28,568 | ||||||||||||||
Total tangible stockholders' equity | 931,189 | 868,027 | 828,124 | 798,502 | 770,739 | ||||||||||||||
Less: | |||||||||||||||||||
Preferred stock | 141,000 | 141,000 | 141,000 | 141,000 | 141,000 | ||||||||||||||
Total tangible common equity | 790,189 | 727,027 | 687,124 | 657,502 | 629,739 | ||||||||||||||
Add: | |||||||||||||||||||
Deferred tax - attributed to intangible assets | 1,138 | 1,243 | 1,452 | 1,661 | 1,870 | ||||||||||||||
Total tangible common equity, net of tax | $ | 791,327 | $ | 728,270 | $ | 688,576 | $ | 659,163 | $ | 631,609 | |||||||||
Total assets | $ | 10,023,587 | $ | 9,746,623 | $ | 9,307,342 | $ | 8,920,449 | $ | 8,592,692 | |||||||||
Less: | |||||||||||||||||||
Goodwill and intangible assets, net | 26,475 | 26,777 | 27,374 | 27,970 | 28,568 | ||||||||||||||
Tangible assets | 9,997,112 | 9,719,846 | 9,279,968 | 8,892,479 | 8,564,124 | ||||||||||||||
Add: | |||||||||||||||||||
Deferred tax - attributed to intangible assets | 1,138 | 1,243 | 1,452 | 1,661 | 1,870 | ||||||||||||||
Total tangible assets, net of tax | $ | 9,998,250 | $ | 9,721,089 | $ | 9,281,420 | $ | 8,894,140 | $ | 8,565,994 | |||||||||
Tangible equity ratio (3) | 9.3 | % | 8.9 | % | 8.9 | % | 9.0 | % | 9.0 | % | |||||||||
Tangible common equity ratio (3) | 7.9 | % | 7.5 | % | 7.4 | % | 7.4 | % | 7.4 | % | |||||||||
Common shares outstanding | 87,774 | 87,554 | 87,186 | 87,099 | 86,997 | ||||||||||||||
Tangible book value per share, net of tax (4) | $ | 9.02 | $ | 8.32 | $ | 7.90 | $ | 7.57 | $ | 7.26 |
Western Alliance Bancorporation and Subsidiaries | |||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures (Unaudited) | |||||||||||||||||||
Efficiency Ratio | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | |||||||||||||||
(in thousands) | |||||||||||||||||||
Total operating non-interest expense | $ | 52,206 | $ | 52,139 | $ | 51,365 | $ | 48,286 | $ | 47,035 | |||||||||
Divided by: | |||||||||||||||||||
Total net interest income | $ | 93,898 | $ | 90,777 | $ | 89,981 | $ | 84,559 | $ | 82,152 | |||||||||
Add: | |||||||||||||||||||
Tax equivalent adjustment | 6,029 | 5,705 | 3,728 | 3,272 | 2,929 | ||||||||||||||
Operating non-interest income | 5,701 | 5,745 | 5,220 | 5,815 | 5,013 | ||||||||||||||
$ | 105,628 | $ | 102,227 | $ | 98,929 | $ | 93,646 | $ | 90,094 | ||||||||||
Efficiency ratio - tax equivalent basis (5) | 49.4 | % | 51.0 | % | 51.9 | % | 51.6 | % | 52.2 | % |
Tier 1 Common Equity | |||||||
June 30, | |||||||
2014 | 2013 | ||||||
(in thousands) | |||||||
Stockholders' equity | $ | 957,664 | $ | 799,307 | |||
Less: | |||||||
Accumulated other comprehensive income (loss) | 8,472 | (10,750 | ) | ||||
Non-qualifying goodwill and intangibles | 25,707 | 26,756 | |||||
Other non-qualifying assets | — | 2 | |||||
Disallowed unrealized losses on equity securities | — | 103 | |||||
Add: | |||||||
Qualifying trust preferred securities | 49,039 | 47,228 | |||||
Tier 1 capital (regulatory) (6) (9) | 972,524 | 830,424 | |||||
Less: | |||||||
Qualifying trust preferred securities | 49,039 | 47,228 | |||||
Preferred stock | 141,000 | 141,000 | |||||
Estimated Tier 1 common equity (7) (9) | $ | 782,485 | $ | 642,196 | |||
Divided by: | |||||||
Estimated risk-weighted assets (regulatory) (7) (9) | $ | 8,684,802 | $ | 7,698,091 | |||
Tier 1 common equity ratio (7) (9) | 9.0 | % | 8.3 | % | |||
Tier 1 Capital | |||||||
June 30, | |||||||
2014 | 2013 | ||||||
(in thousands) | |||||||
Classified assets | $ | 264,766 | $ | 298,887 | |||
Divide: | |||||||
Tier 1 capital (regulatory) (6) (9) | 972,524 | 830,424 | |||||
Plus: Allowance for credit losses | 105,937 | 96,323 | |||||
Total Tier 1 capital plus allowance for credit losses | $ | 1,078,461 | $ | 926,747 | |||
Classified assets to Tier 1 capital plus allowance (8) (9) | 25 | % | 32 | % |
(1) We believe these non-GAAP measurements provide a useful indication of the cash generating capacity of the Company. | |||||||
(2) We believe this non-GAAP measurement is a key indicator of the earnings power of the Company. | |||||||
(3) We believe this non-GAAP ratio provides a critical metric with which to analyze and evaluate financial condition and capital strength. | |||||||
(4) We believe this non-GAAP ratio improves the comparability to other institutions that have not engaged in acquisitions that resulted in recorded goodwill and other intangibles. | |||||||
(5) We believe this non-GAAP ratio provides a useful metric to measure the operating efficiency of the Company. | |||||||
(6) Under the guidelines of the Federal Reserve and the Federal Deposit Insurance Corporation in effect, Tier 1 capital consisted of common stock, retained earnings, non-cumulative perpetual preferred stock, trust preferred securities up to a certain limit, and minority interests in certain subsidiaries, less most other intangible assets. | |||||||
(7) Tier 1 common equity is often expressed as a percentage of risk-weighted assets. Under the risk-based capital framework, a bank's balance sheet assets and credit equivalent amounts of off-balance sheet items are assigned to one of four broad risk categories. The aggregated dollar amount in each category is then multiplied by the risk weighting assigned to that category. The resulting weighted values from each of the four categories are added together and this sum is the risk-weighted assets total that, as adjusted, comprises the denominator (risk-weighted assets) to determine the Tier 1 capital ratio. Adjustments are made to Tier 1 capital to arrive at Tier 1 common equity. Tier 1 common equity is divided by the risk-weighted assets to determine the Tier 1 common equity ratio. We believe this non-GAAP ratio provides a critical metric with which to analyze and evaluate financial condition and capital strength. | |||||||
(8) We believe this non-GAAP ratio provides a critical regulatory metric in which to analyze asset quality. | |||||||
(9) Current quarter is preliminary until Call Reports are filed. |
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