Exhibit 99
 |
News Release
For further information, please contact: |
| 5790 Widewaters Parkway, DeWitt, N.Y. 13214 |
Scott A. Kingsley, EVP & Chief Financial
Officer
Office: (315) 445-3121 |
Community Bank System Reports
Record Third Quarter 2017 Results
- Reported GAAP EPS of $0.68 per share and Operating
EPS of $0.69 per share
- Increased dividends to shareholders for the 25th
consecutive year
SYRACUSE, N.Y. — October 23, 2017 — Community Bank System,
Inc. (NYSE: CBU) reported third quarter 2017 net income of $35.2 million, or $0.68 per fully diluted share, compared with $27.2
million, or $0.61 per share reported for the third quarter of 2016. Third quarter 2017’s results included $0.6 million, or
$0.01 per share of acquisition expenses related to the completed acquisition of Merchants Bancshares, Inc. (“Merchants”).
Excluding acquisition expenses, quarterly earnings per share were $0.69 per share, a new quarterly high for the Company. Diluted
earnings per share totaled $1.60 for the first nine months of 2017, compared to $1.74 per share in the first nine months of 2016.
Excluding acquisition expenses, year-to-date earnings per share were $1.96, or 12.6% above the first nine months of 2016.
“We realized another record performance reflecting full third
quarter contributions from our Northeast Retirement Services, Inc. (“NRS”) acquisition completed in February, and from
our Merchants Bancshares merger which closed in May,” said President and Chief Executive Officer Mark E. Tryniski. “Both
of these high-value transactions have performed above our initial expectations. NRS continued to grow both its top and bottom line
performance at a double-digit pace, and the Merchants integration has proceeded smoothly with cost synergies running ahead of plan.
Our accelerated operating performance, reflects improvements in expense management, credit quality and growth in non-interest income,
all of which contributed to the 13% increase in per share results (excluding acquisition expenses) compared with the third quarter
of 2016. We are well positioned to continue delivering a high level of operating performance for the benefit of our shareholders.”
Total revenues for the third quarter of 2017 were $137.3 million,
an increase of $28.9 million, or 26.7%, over the prior year quarter, and included a full quarter of revenues from both the
Merchants and NRS transactions completed in the first half of this year. Higher revenues were generated as a result of a 23.0%
increase in average earning assets and continued growth in noninterest income, partially offset by a three basis-point decline
in the net interest margin from the prior year quarter. A combination of acquired and organic growth resulted in a $10.6 million,
or 47.9% increase in wealth management, insurance, and employee benefit services revenues. Deposit service fees increased 23.7%
year-over-year, primarily the result of the addition of Merchants, as well as increased card-related revenues. Other banking services
declined $1.2 million from the third quarter of 2016, almost entirely related to an insurance-related gain experienced last year.
The quarterly provision for loan losses of $2.3 million was $0.5 million higher than the third quarter of 2016,
primarily reflective of modestly higher quarterly net charge-off levels. Benefitting from the addition of the Merchants’
loan portfolios, non-performing asset and delinquent loan ratios were lower than the end of the third quarter of 2016. Total third
quarter operating expenses were $83.8 million, and included $0.6 million of non-recurring acquisition expenses related to the Merchants
transaction. Excluding acquisition expenses from both periods, total operating expenses of $83.2 million for the third
quarter were $17.0 million, or 25.6% above the third quarter of 2016, and included the operating expenses from Merchants and NRS,
as well as an additional $3.6 million of intangible amortization, primarily from the two transactions.
Third quarter 2017 net interest income was $84.4 million, an increase
of $15.9 million, or 23.3%, compared to the third quarter of 2016, and included a full quarter from Merchants. A two basis-point
increase in combined funding costs and a slight decline in earning asset yields, which included an incremental $1.3 million in
purchased loan accretion, resulted in a three basis-point decrease in net interest margin quarter-over-quarter. Average loan balances
grew $1.43 billion, or 29.1%, principally related to the Merchants transaction, while average loan yields increased one basis point
quarter-over-quarter, including the incremental purchased loan accretion. Investment interest income was $1.4 million higher than
the third quarter of 2016, as average investment securities (including cash equivalents) balances increased by $340.1 million,
while the yield on investments declined 18 basis points. Interest expense was $1.2 million higher than the previous year’s
quarter, driven by a $213.5 million increase in average borrowings (including customer repurchase agreements) and a $1.56 billion
increase in average deposit balances, principally related to the Merchants transaction, and a net two basis point increase in the
cost of funds.
Wealth management and insurance services revenues increased to $12.1
million, $1.1 million, or 10.3%, higher than the third quarter of 2016, driven by both acquired and organic growth. Employee benefit
services revenues of $20.8 million increased $9.5 million from the third quarter of 2016, primarily from the NRS acquisition.
Excluding acquisition expenses related to the Merchants’ transaction,
third quarter 2017 operating expenses of $83.2 million, which included a full quarter of operating activities from both Merchants
and NRS, increased $17.0 million over the third quarter of 2016. Salaries and employee benefits increased $8.3 million, or 21.6%,
and included the personnel added from both transactions, as well as planned merit increases. All other expenses increased 31.2%,
and reflected the occupancy, equipment and other operating costs of both Merchants and NRS, including significantly higher intangible
amortization, compared to the third quarter of 2016.
During the first quarter of 2017, the Company adopted new accounting
guidance for share-based transactions. That guidance requires that all excess tax benefits and tax deficiencies associated with
share-based compensation be recognized as income tax expense or benefit in the income statement. Previously, tax effects resulting
from changes in the Company’s share price subsequent to the grant date of equity instruments were recorded through shareholders’
equity at the time of vesting or exercise. The adoption of the amended accounting guidance resulted in a $2.2 million reduction
of income tax expense in the first quarter of 2017, or $0.04 of diluted earnings per common share, and a $0.3 million reduction
of income tax expense in both the second and third quarters, or less than $0.01 per share each quarter. The third quarter 2017
effective income tax was 31.2%, down from 32.8% in the prior year quarter, and reflected the $0.3 million reduction in income tax
expense related to this change in accounting for share-based transactions, and also included the impact of the non-recurring acquisition
expenses incurred in the first nine months of 2017.
The Company also provides supplemental reporting of its results
on a “net adjusted” or “tangible” basis, from which it excludes the after-tax effect of amortization of
core deposit and other intangible assets (and the related goodwill, core deposit intangible and other intangible asset balances,
net of applicable deferred tax amounts), accretion on non-impaired purchased loans, and expenses associated with acquisitions.
The amounts of such expenses are presented in the tables that accompany this release. Although “adjusted net income”
as defined by the Company is a non-GAAP measure, the Company’s management believes this information helps investors understand
the effect of acquisition activity in its reported results. Adjusted net earnings per share were $0.73 in the third quarter of
2017, compared to $0.62 in the third quarter of 2016, or a 17.7% increase.
Financial Position
Average earning assets of $9.45 billion for the third quarter of
2017 were up $1.77 billion, or 23.0% from the third quarter of 2016, and included a full quarter from the Merchants transaction.
Similarly, average deposit balances grew $1.56 billion, or 22.4% compared to the third quarter of 2016. Average borrowings (including
customer repurchase agreements) in the third quarter of 2017 of $541.0 million, were $213.5 million, or 65.2%, higher than the
third quarter of last year.
Ending loans at September 30, 2017 increased $1.37 billion, or 27.7%,
year-over-year, reflecting the Merchants acquisition. Investment securities totaled $3.13 billion at September 30, 2017, down slightly
from the end of the second quarter, and up from the previous three quarter-ends due to investments added from Merchants, and partially
offset by limited reinvestment of securities cash flows over the last twelve months.
Shareholders’ equity of $1.59 billion at September 30, 2017
was $352.7 million, or 28.4%, higher than the prior year period, a result of strong earnings generation and capital retention over
the last four quarters, as well as incremental shares issued in conjunction with the NRS and Merchants acquisitions. The Company’s
net tangible equity to net tangible assets ratio was 8.37% at September 30, 2017, down from 9.66% a year earlier, a result of the
two acquisitions completed in the first half of 2017. The Company’s Tier 1 leverage ratio was 9.54% at the end of the third
quarter, compared to 10.35% a year earlier.
As previously announced in December 2016, the Company’s Board
of Directors approved a stock repurchase program authorizing the repurchase of up to 2.2 million shares of the Company’s
common stock during a twelve-month period starting January 1, 2017. Such repurchases may be made at the discretion of the Company’s
senior management based on market conditions and other relevant factors and will be acquired through open market or privately negotiated
transactions as permitted under Rule 10b-18 of the Securities Exchange Act of 1934 and other applicable legal requirements. There
were no shares repurchased in the first nine months of 2017.
Asset Quality
The Company’s asset quality metrics continue to be favorable
relative to comparative peer and industry averages and illustrate the long-term effectiveness of the Company’s disciplined
risk management and underwriting standards. Net charge-offs were $1.8 million for the third quarter, compared to $1.5 million for
the third quarter of 2016 and $1.1 million for the second quarter of 2017. Net charge-offs as an annualized percentage of average
loans measured 0.11% in the third quarter of 2017, compared to 0.12% in last year’s third quarter and 0.08% in the second
quarter of 2017. Nonperforming loans as a percentage of total loans at September 30, 2017 were 0.37%, improved from 0.47% at September
30, 2016 and generally consistent with 0.36% at June 30, 2017. The total loan delinquency ratio of 1.05% at the end of the third
quarter was one basis point lower than the level at September 30, 2016, and six basis points higher than this year’s second
quarter-end. The third quarter provision for loan losses of $2.3 million was $0.5 million higher than the third quarter of 2016,
and $0.9 million higher than the second quarter of 2017. The allowance for loan losses to nonperforming loans was 205% at September
30, 2017, compared with the 201% and 207% levels at the end of the third quarter of 2016 and second quarter of 2017, respectively.
Dividend Increase
During the third quarter of 2017 the Company declared a quarterly
cash dividend of $0.34 per share on its common stock, compared to a $0.32 dividend declared in the second quarter of 2017 and the
third quarter of 2016. This increase marked the 25th consecutive year of dividend increases for the Company. President
and Chief Executive Officer, Mark E. Tryniski, commented, “The payment of a meaningful and growing dividend is an important
component of our commitment to provide consistent and favorable long-term returns to our shareholders. The increase reflected the
continued strength of our current operating performance and capital position.” The two cent, or 6.3%, increase in the Company’s
quarterly cash dividend over the same quarter of the prior year, represents an annualized yield of 2.44% based upon its’
closing price of $55.74 on October 20, 2017.
Merchants Bancshares, Inc.
On October 24, 2016, the Company announced that it had entered into
a definitive agreement to acquire Merchants Bancshares, Inc. ("Merchants"), parent company of Merchants Bank headquartered
in South Burlington, Vermont, for approximately $345.2 million in Company stock and cash. The acquisition was completed on May
12, 2017. The transaction extended the Company's footprint into the Vermont and Western Massachusetts markets. Upon
the completion of the merger, Community Bank added 31 branch locations in Vermont and one office in Western Massachusetts with
approximately $2.0 billion of assets and deposits of $1.5 billion.
Northeast Retirement Services, Inc.
On December 5, 2016, the Company announced that it had entered into
a definitive agreement to acquire Northeast Retirement Services, Inc. (“NRS”), a leading provider of plan accounting,
transfer agency, fund administration, trust and retirement plan services for approximately $148.6 million in Company stock and
cash. The acquisition was completed on February 3, 2017.
Conference Call Scheduled
Company management will conduct an investor call at 11:00 a.m. (ET)
today, October 23, 2017, to discuss third quarter results. The conference call can be accessed at 888-554-1432 (1-719-325-2295
if outside United States and Canada) using the conference ID code 1065398. Investors may also listen live via the Internet at:
http://www.webcaster4.com/Webcast/Page/995/22986.
This earnings release, including supporting financial tables, is
available within the press releases section of the Company's investor relations website at: http://ir.communitybanksystem.com.
An archived webcast of the earnings call will be available on this site for one full year.
Community Bank System, Inc. operates more than 230 customer facilities
across Upstate New York, Northeastern Pennsylvania, Vermont, and Western Massachusetts through its banking subsidiary, Community
Bank, N.A. With assets of approximately $10.8 billion, the DeWitt, N.Y. headquartered company is among the country's 150 largest
financial institutions. In addition to a full range of retail, business, and municipal banking services, the Company offers comprehensive
financial planning, insurance and wealth management services through its’ Community Bank Wealth Management Group and OneGroup
NY, Inc. operating subsidiaries. The Company's Benefit Plans Administrative Services, Inc. subsidiary (which includes the recently
acquired NRS) is a leading provider of employee benefits administration, trust services, fund administration and actuarial consulting
services to customers on a national scale. Community Bank System, Inc. is listed on the New York Stock Exchange and the Company's
stock trades under the symbol CBU. For more information about Community Bank visit www.communitybankna.com or http://ir.communitybanksystem.com.
# # #
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. The following factors, among others, could cause the actual
results of CBU’s operations to differ materially from CBU’s expectations: the successful integration of operations
of its acquisitions; competition; changes in economic conditions, interest rates and financial markets; changes in legislation
or regulatory requirements; and the timing for receiving regulatory approvals and completing pending transactions. These statements
are based on the current beliefs and expectations of CBU’s management and CBU does not assume any duty to update forward-looking
statements.
Summary of Financial Data |
|
|
|
|
| (Dollars in thousands, except per share data) |
|
|
|
|
| |
Quarter Ended |
Year-to-Date |
| |
September 30,
2017 |
September
30,
2016 |
September 30,
2017 |
September
30,
2016 |
| Earnings |
|
|
|
|
| Loan income |
$69,498 |
$53,706 |
$184,233 |
$157,865 |
| Investment income |
18,989 |
17,616 |
55,634 |
54,323 |
| Total interest income |
88,487 |
71,322 |
239,867 |
212,188 |
| Interest expense |
4,092 |
2,859 |
10,169 |
8,538 |
| Net interest income |
84,395 |
68,463 |
229,698 |
203,650 |
| Provision for loan losses |
2,314 |
1,790 |
5,603 |
5,436 |
| Net interest income after provision for loan losses |
82,081 |
66,673 |
224,095 |
198,214 |
| Deposit service fees |
18,419 |
14,894 |
49,781 |
43,636 |
| Revenues from mortgage banking and other banking services |
1,704 |
2,863 |
4,270 |
6,039 |
| Wealth management and insurance services |
12,051 |
10,928 |
35,814 |
32,381 |
| Employee benefit services |
20,767 |
11,267 |
58,618 |
34,949 |
| Gain on sale of investments |
0 |
0 |
2 |
0 |
| Total noninterest income |
52,941 |
39,952 |
148,485 |
117,005 |
| Salaries and employee benefits |
46,568 |
38,300 |
132,776 |
115,388 |
| Occupancy and equipment |
9,106 |
7,373 |
25,939 |
22,445 |
| Amortization of intangible assets |
4,949 |
1,359 |
11,980 |
4,204 |
| Acquisition expenses |
580 |
2 |
25,192 |
342 |
| Other |
22,573 |
19,192 |
64,343 |
57,872 |
| Total operating expenses |
83,776 |
66,226 |
260,230 |
200,251 |
| Income before income taxes |
51,246 |
40,399 |
112,350 |
114,968 |
| Income taxes |
16,003 |
13,239 |
33,659 |
37,548 |
| Net income |
$35,243 |
$27,160 |
$78,691 |
$77,420 |
| Basic earnings per share |
$0.69 |
$0.61 |
$1.62 |
$1.75 |
| Diluted earnings per share |
$0.68 |
$0.61 |
$1.60 |
$1.74 |
| Summary of Financial Data |
|
|
|
|
|
| (Dollars in thousands, except per share data) |
|
|
|
|
|
| |
|
2017 |
|
2016 |
| |
3rd Qtr |
2nd Qtr |
1st Qtr |
4th Qtr |
3rd Qtr |
| Earnings |
|
|
|
|
|
| Loan income |
$69,498 |
$62,351 |
$52,384 |
$53,602 |
$53,706 |
| Investment income |
18,989 |
19,071 |
17,574 |
19,397 |
17,616 |
| Total interest income |
88,487 |
81,422 |
69,958 |
72,999 |
71,322 |
| Interest expense |
4,092 |
3,393 |
2,684 |
2,753 |
2,859 |
| Net interest income |
84,395 |
78,029 |
67,274 |
70,246 |
68,463 |
| Provision for loan losses |
2,314 |
1,461 |
1,828 |
2,640 |
1,790 |
| Net interest income after provision for loan losses |
82,081 |
76,568 |
65,446 |
67,606 |
66,673 |
| Deposit service fees |
18,419 |
16,655 |
14,707 |
14,959 |
14,894 |
| Revenues from mortgage banking and other banking services |
1,704 |
1,407 |
1,159 |
1,438 |
2,863 |
| Wealth management and insurance services |
12,051 |
12,502 |
11,261 |
10,544 |
10,928 |
| Employee benefit services |
20,767 |
20,662 |
17,189 |
11,679 |
11,267 |
| Gain on sale of investments |
0 |
0 |
2 |
0 |
0 |
| Total noninterest income |
52,941 |
51,226 |
44,318 |
38,620 |
39,952 |
| Salaries and employee benefits |
46,568 |
44,808 |
41,400 |
36,259 |
38,300 |
| Occupancy and equipment |
9,106 |
8,637 |
8,196 |
7,633 |
7,373 |
| Amortization of intangible assets |
4,949 |
4,263 |
2,768 |
1,275 |
1,359 |
| Acquisition expenses |
580 |
22,896 |
1,716 |
1,364 |
2 |
| Other |
22,573 |
22,275 |
19,495 |
20,066 |
19,192 |
| Total operating expenses |
83,776 |
102,879 |
73,575 |
66,597 |
66,226 |
| Income before income taxes |
51,246 |
24,915 |
36,189 |
39,629 |
40,399 |
| Income taxes |
16,003 |
7,724 |
9,932 |
13,237 |
13,239 |
| Net income |
$35,243 |
$17,191 |
$26,257 |
$26,392 |
$27,160 |
| Basic earnings per share |
$0.69 |
$0.35 |
$0.58 |
$0.59 |
$0.61 |
| Diluted earnings per share |
$0.68 |
$0.35 |
$0.57 |
$0.59 |
$0.61 |
| Profitability |
|
|
|
|
|
| Return on assets |
1.29% |
0.69% |
1.22% |
1.21% |
1.24% |
| Return on equity |
8.81% |
4.74% |
8.47% |
8.59% |
8.71% |
| Return on tangible equity(2) |
16.74% |
7.72% |
13.57% |
13.40% |
13.52% |
| Noninterest income/operating income (FTE) (1) |
38.4% |
39.4% |
39.1% |
35.0% |
36.5% |
| Efficiency ratio |
56.8% |
58.2% |
60.9% |
57.9% |
59.3% |
| Components of Net Interest Margin (FTE) |
|
|
|
|
|
| Loan yield |
4.37% |
4.41% |
4.31% |
4.33% |
4.36% |
| Cash equivalents yield |
1.09% |
0.99% |
0.79% |
0.48% |
0.46% |
| Investment yield |
2.69% |
2.87% |
2.90% |
3.14% |
2.88% |
| Earning asset yield |
3.81% |
3.87% |
3.80% |
3.90% |
3.82% |
| Interest-bearing deposit rate |
0.14% |
0.14% |
0.13% |
0.13% |
0.13% |
| Borrowing rate |
1.44% |
1.54% |
2.18% |
1.80% |
1.31% |
| Cost of all interest-bearing funds |
0.24% |
0.21% |
0.19% |
0.19% |
0.20% |
| Cost of funds (includes DDA) |
0.18% |
0.16% |
0.15% |
0.15% |
0.16% |
| Net interest margin (FTE) |
3.64% |
3.72% |
3.65% |
3.76% |
3.67% |
| Fully tax-equivalent adjustment |
$2,395 |
$2,400 |
$2,310 |
$2,382 |
$2,450 |
| Summary of Financial Data |
|
|
|
|
|
| (Dollars in thousands, except per share data) |
|
|
|
|
|
| |
2017 |
2016 |
| |
3rd Qtr |
2nd Qtr |
1st Qtr |
4th Qtr |
3rd Qtr |
| Average Balances |
|
|
|
|
|
| Loans |
$6,343,468 |
$5,695,781 |
$4,939,092 |
$4,934,034 |
$4,913,517 |
| Cash equivalents |
26,986 |
52,956 |
40,209 |
15,367 |
19,110 |
| Taxable investment securities |
2,571,461 |
2,408,020 |
2,203,175 |
2,179,840 |
2,179,044 |
| Nontaxable investment securities |
511,181 |
526,962 |
540,518 |
556,774 |
571,327 |
| Total interest-earning assets |
9,453,096 |
8,683,719 |
7,722,994 |
7,686,015 |
7,682,998 |
| Total assets |
10,862,493 |
9,958,553 |
8,747,266 |
8,665,948 |
8,712,758 |
| Interest-bearing deposits |
6,230,591 |
6,021,696 |
5,543,046 |
5,472,420 |
5,405,180 |
| Borrowings |
541,036 |
346,975 |
177,587 |
213,930 |
327,578 |
| Total interest-bearing liabilities |
6,771,627 |
6,368,671 |
5,720,633 |
5,686,350 |
5,732,758 |
| Noninterest-bearing deposits |
2,307,205 |
1,948,434 |
1,620,473 |
1,603,703 |
1,569,960 |
| Shareholders' equity |
1,587,279 |
1,455,847 |
1,256,888 |
1,222,124 |
1,239,927 |
| Balance Sheet Data |
|
|
|
|
|
| Cash and cash equivalents |
$241,480 |
$219,695 |
$291,186 |
$173,857 |
$161,542 |
| Investment securities |
3,125,218 |
3,145,013 |
2,788,718 |
2,784,392 |
2,877,644 |
| Loans: |
|
|
|
|
|
| Consumer mortgage |
2,206,527 |
2,211,412 |
1,830,800 |
1,819,701 |
1,798,748 |
| Business lending |
2,458,981 |
2,479,152 |
1,468,465 |
1,490,076 |
1,506,878 |
| Consumer indirect |
1,034,716 |
1,057,664 |
1,055,112 |
1,044,972 |
1,037,077 |
| Home equity |
424,598 |
427,483 |
393,769 |
401,998 |
401,784 |
| Consumer direct |
183,898 |
185,589 |
184,067 |
191,815 |
196,134 |
| Total loans |
6,308,720 |
6,361,300 |
4,932,213 |
4,948,562 |
4,940,621 |
| Allowance for loan losses |
47,983 |
47,451 |
47,096 |
47,233 |
46,789 |
| Intangible assets, net |
824,355 |
831,403 |
618,977 |
480,844 |
482,119 |
| Other assets |
387,430 |
374,086 |
329,862 |
326,015 |
312,609 |
| Total assets |
10,839,220 |
10,884,046 |
8,913,860 |
8,666,437 |
8,727,746 |
| Deposits: |
|
|
|
|
|
| Noninterest-bearing |
2,310,954 |
2,283,138 |
1,642,158 |
1,646,039 |
1,577,194 |
| Non-maturity interest-bearing |
5,495,377 |
5,508,504 |
5,010,516 |
4,726,787 |
4,771,436 |
| Time |
799,659 |
833,963 |
684,203 |
703,128 |
728,789 |
| Total deposits |
8,605,990 |
8,625,605 |
7,336,877 |
7,075,954 |
7,077,419 |
| Borrowings |
314,289 |
373,053 |
0 |
146,200 |
133,900 |
| Subordinated debt held by unconsolidated subsidiary trusts |
122,808 |
122,802 |
102,177 |
102,170 |
102,164 |
| Accrued interest and other liabilities |
202,888 |
189,686 |
178,776 |
144,013 |
173,681 |
| Total liabilities |
9,245,975 |
9,311,146 |
7,617,830 |
7,468,337 |
7,487,164 |
| Shareholders' equity |
1,593,245 |
1,572,900 |
1,296,030 |
1,198,100 |
1,240,582 |
| Total liabilities and shareholders' equity |
10,839,220 |
10,884,046 |
8,913,860 |
8,666,437 |
8,727,746 |
| Capital |
|
|
|
|
|
| Tier 1 leverage ratio |
9.54% |
10.19% |
10.35% |
10.55% |
10.35% |
| Tangible equity/net tangible assets (2) |
8.37% |
8.08% |
8.91% |
9.24% |
9.66% |
| Diluted weighted average common shares O/S |
51,526 |
49,386 |
46,227 |
45,025 |
44,835 |
| Period end common shares outstanding |
50,587 |
50,512 |
45,956 |
44,437 |
44,357 |
| Cash dividends declared per common share |
$0.34 |
$0.32 |
$0.32 |
$0.32 |
$0.32 |
| Book value |
$31.50 |
$31.14 |
$28.20 |
$26.96 |
$27.97 |
| Tangible book value(2) |
$16.70 |
$16.21 |
$16.22 |
$17.12 |
$18.06 |
| Common stock price (end of period) |
$55.25 |
$55.77 |
$54.98 |
$61.79 |
$48.11 |
| Summary of Financial Data |
|
|
|
|
|
| (Dollars in thousands, except per share data) |
|
|
|
|
|
| |
2017 |
2016 |
| |
3rd Qtr |
2nd Qtr |
1st Qtr |
4th Qtr |
3rd Qtr |
| Asset Quality |
|
|
|
|
|
| Nonaccrual loans |
$21,510 |
$21,033 |
$20,066 |
$20,619 |
$21,301 |
| Accruing loans 90+ days delinquent |
1,861 |
1,882 |
2,809 |
3,076 |
2,015 |
| Total nonperforming loans |
23,371 |
22,915 |
22,875 |
23,695 |
23,316 |
| Other real estate owned (OREO) |
1,873 |
2,491 |
2,486 |
1,966 |
2,060 |
| Total nonperforming assets |
25,244 |
25,406 |
25,361 |
25,661 |
25,376 |
| Net charge-offs |
1,782 |
1,106 |
1,965 |
2,196 |
1,527 |
| Allowance for loan losses/loans outstanding |
0.76% |
0.75% |
0.95% |
0.95% |
0.95% |
| Nonperforming loans/loans outstanding |
0.37% |
0.36% |
0.46% |
0.48% |
0.47% |
| Allowance for loan losses/nonperforming loans |
205% |
207% |
206% |
199% |
201% |
| Net charge-offs/average loans |
0.11% |
0.08% |
0.16% |
0.18% |
0.12% |
| Delinquent loans/ending loans |
1.05% |
0.99% |
0.94% |
1.19% |
1.06% |
| Loan loss provision/net charge-offs |
130% |
132% |
93% |
120% |
117% |
| Nonperforming assets/total assets |
0.23% |
0.23% |
0.28% |
0.30% |
0.29% |
| Asset Quality (excluding loans acquired since 1/1/09) |
|
|
|
|
|
| Nonaccrual loans |
$15,069 |
$14,359 |
$15,268 |
$16,600 |
$16,966 |
| Accruing loans 90+ days delinquent |
1,590 |
1,640 |
1,707 |
1,963 |
1,869 |
| Total nonperforming loans |
16,659 |
15,999 |
16,975 |
18,563 |
18,835 |
| Other real estate owned (OREO) |
1,257 |
1,681 |
2,225 |
1,658 |
1,594 |
| Total nonperforming assets |
17,916 |
17,680 |
19,200 |
20,221 |
20,429 |
| Net charge-offs |
1,624 |
692 |
1,866 |
1,846 |
1,432 |
| Allowance for loan losses/loans outstanding |
1.00% |
1.01% |
1.01% |
1.02% |
1.02% |
| Nonperforming loans/loans outstanding |
0.36% |
0.35% |
0.38% |
0.42% |
0.43% |
| Allowance for loan losses/nonperforming loans |
276% |
284% |
266 % |
245% |
238% |
| Net charge-offs/average loans |
0.14% |
0.06% |
0.17% |
0.17% |
0.13% |
| Delinquent loans/ending loans |
1.16% |
1.06% |
0.86% |
1.14% |
1.01% |
| Loan loss provision/net charge-offs |
125% |
153% |
85% |
133% |
124% |
| Nonperforming assets/total assets |
0.20% |
0.20% |
0.23% |
0.25% |
0.25% |
| Summary of Financial Data |
|
|
|
|
|
| (Dollars in thousands, except per share data) |
|
|
|
|
|
| |
2017 |
2016 |
| |
3rd Qtr |
2nd Qtr |
1st Qtr |
4th Qtr |
3rd Qtr |
| Quarterly GAAP to Non-GAAP Reconciliations |
|
|
|
|
|
| Income statement data |
|
|
|
|
|
| Net income |
|
|
|
|
|
| Net income (GAAP) |
$35,243 |
$17,191 |
$26,257 |
$26,392 |
$27,160 |
| Acquisition expenses |
580 |
22,896 |
1,716 |
1,364 |
2 |
| Tax effect of acquisition expenses |
(181) |
(7,098) |
(471) |
(456) |
(1) |
| Subtotal (non-GAAP) |
35,642 |
32,989 |
27,502 |
27,300 |
27,161 |
| Amortization of intangibles |
4,949 |
4,263 |
2,768 |
1,275 |
1,359 |
| Tax effect of amortization of intangibles |
(1,545) |
(1,322) |
(760) |
(426) |
(445) |
| Subtotal (non-GAAP) |
39,046 |
35,930 |
29,510 |
28,149 |
28,075 |
| Acquired non-impaired loan accretion |
(1,879) |
(1,642) |
(437) |
(836) |
(594) |
| Tax effect of acquired non-impaired loan accretion |
587 |
509 |
120 |
279 |
195 |
| Adjusted net income (non-GAAP) |
$37,754 |
$34,797 |
$29,193 |
$27,592 |
$27,676 |
| |
|
|
|
|
|
| Return on average assets |
|
|
|
|
|
| Adjusted net income (non-GAAP) |
$37,754 |
$34,797 |
$29,193 |
$27,592 |
$27,676 |
| Average total assets |
10,862,493 |
9,958,553 |
8,747,266 |
8,665,948 |
8,712,758 |
| Adjusted return on average assets |
1.38% |
1.40% |
1.35% |
1.27% |
1.26% |
| |
|
|
|
|
|
| Return on average equity |
|
|
|
|
|
| Adjusted net income (non-GAAP) |
$37,754 |
$34,797 |
$29,193 |
$27,592 |
$27,676 |
| Average total equity |
1,587,279 |
1,455,847 |
1,256,888 |
1,222,124 |
1,239,927 |
| Adjusted return on average equity |
9.44% |
9.59% |
9.42% |
8.98% |
8.88% |
| |
|
|
|
|
|
| Earnings per common share |
|
|
|
|
|
| Diluted earnings per share (GAAP) |
$0.68 |
$0.35 |
$0.57 |
$0.59 |
$0.61 |
| Acquisition expenses |
0.01 |
0.46 |
0.04 |
0.03 |
0.00 |
| Tax effect of acquisition expenses |
(0.00) |
( 0.14) |
(0.01) |
(0.01) |
(0.00) |
| Subtotal (non-GAAP) |
0.69 |
0.67 |
0.60 |
0.61 |
0.61 |
| Amortization of intangibles |
0.10 |
0.09 |
0.06 |
0.03 |
0.03 |
| Tax effect of amortization of intangibles |
(0.03) |
(0.03) |
(0.02) |
(0.01) |
(0.01) |
| Subtotal (non-GAAP) |
0.76 |
0.73 |
0.64 |
0.63 |
0.63 |
| Acquired non-impaired loan accretion |
(0.04) |
(0.03) |
(0.01) |
(0.02) |
(0.01) |
| Tax effect of acquired non-impaired loan accretion |
0.01 |
0.01 |
0.00 |
0.01 |
0.00 |
| Diluted adjusted net earnings per share (non-GAAP) |
$0.73 |
$0.71 |
$0.63 |
$0.62 |
$0.62 |
| |
|
|
|
|
|
| Noninterest operating expenses |
|
|
|
|
|
| Noninterest expenses (GAAP) |
$83,776 |
$102,879 |
$73,575 |
$66,597 |
$66,226 |
| Amortization of intangibles |
(4,949) |
(4,263) |
(2,768) |
(1,275) |
(1,359) |
| Acquisition expenses |
(580) |
(22,896) |
(1,716) |
(1,364) |
(2) |
| Total adjusted noninterest expenses (non-GAAP) |
$78,247 |
$75,720 |
$69,091 |
$63,958 |
$64,865 |
| |
|
|
|
|
|
| Efficiency ratio |
|
|
|
|
|
| Adjusted noninterest expenses (non-GAAP) - numerator |
$78,247 |
$75,720 |
$69,091 |
$63,958 |
$64,865 |
| Tax-equivalent net interest income |
86,790 |
80,429 |
69,584 |
72,628 |
70,913 |
| Noninterest revenues |
52,941 |
51,226 |
44,318 |
38,620 |
39,952 |
| Acquired non-impaired loan accretion |
(1,879) |
(1,642) |
(437) |
(836) |
(594) |
| Insurance-related recovery |
0 |
0 |
0 |
0 |
(950) |
| Gain on sales of investments |
0 |
0 |
(2) |
0 |
0 |
| Operating revenues (non-GAAP) - denominator |
$137,852 |
$130,013 |
$113,463 |
$110,412 |
$109,321 |
| Efficiency ratio (non-GAAP) |
56.8% |
58.2% |
60.9% |
57.9% |
59.3% |
| |
|
|
|
|
|
| Summary of Financial Data |
|
|
|
|
|
| (Dollars in thousands, except per share data) |
|
|
|
|
|
| |
2017 |
2016 |
| |
3rd Qtr |
2nd Qtr |
1st Qtr |
4th Qtr |
3rd Qtr |
| Quarterly GAAP to Non-GAAP Reconciliations |
|
|
|
|
|
| Balance sheet data |
|
|
|
|
|
| Total assets |
|
|
|
|
|
| |
|
|
|
|
|
| Total assets (GAAP) |
$10,839,220 |
$10,884,046 |
$8,913,860 |
$8,666,437 |
$8,727,746 |
| Intangible assets |
(824,355) |
(831,403) |
(618,977) |
(480,844) |
(482,119) |
| Deferred taxes on intangible assets |
75,820 |
77,097 |
68,236 |
43,504 |
42,523 |
| Total tangible assets (non-GAAP) |
$10,090,685 |
$10,129,740 |
$8,363,119 |
$8,229,097 |
$8,288,150 |
| |
|
|
|
|
|
| Total common equity |
|
|
|
|
|
| Common stock, APIC, Retained earnings, and Treasury stock |
$1,577,068 |
$1,555,258 |
$1,285,676 |
$1,190,258 |
$1,174,491 |
| Accumulated other comprehensive income |
16,177 |
17,642 |
10,354 |
7,842 |
66,091 |
| Shareholders' Equity (GAAP) |
1,593,245 |
1,572,900 |
1,296,030 |
1,198,100 |
1,240,582 |
| Intangible assets |
(824,355) |
(831,403) |
(618,977) |
(480,844) |
(482,119) |
| Deferred taxes on intangible assets |
75,820 |
77,097 |
68,236 |
43,504 |
42,523 |
| Total tangible common equity (non-GAAP) |
$844,710 |
$818,594 |
$745,289 |
$760,760 |
$800,986 |
| |
|
|
|
|
|
| Net tangible equity-to-assets ratio at quarter end |
|
|
|
|
|
| Total tangible common equity (non-GAAP) - numerator |
$844,710 |
$818,594 |
$745,289 |
$760,760 |
$800,986 |
| Total tangible assets (non-GAAP) - denominator |
10,090,685 |
10,129,740 |
8,363,119 |
8,229,097 |
8,288,150 |
| Net tangible equity-to-assets ratio at quarter end (non-GAAP) |
8.37% |
8.08% |
8.91% |
9.24% |
9.66% |
| |
|
|
|
|
|
(1) Excludes gains and losses
on sales of investment securities.
(2) Includes deferred tax liabilities related to certain
intangible assets.
# # #