Exhibit 99.1
For Immediate Release
For more information:
Jefferson Harralson
Chief Financial Officer
(864) 240-6208
Jefferson_Harralson@ucbi.com
United Community Banks, Inc. Reports Fourth Quarter Results
GAAP EPS of $0.55, Return on Assets of 0.96% and Return on Common Equity of 9.3%
GREENVILLE, SC – January 18, 2022 - United Community Banks, Inc. (NASDAQ: UCBI) (United) today announced that net income for the fourth quarter was $52.0 million and pre-tax, pre-provision income was $65.6 million. Diluted earnings per share of $0.55 for the quarter represented a decrease of $0.11 or 17%, from the fourth quarter a year ago, and represented a decrease of $0.27 or 33% from the third quarter of 2021. On an operating basis, United’s diluted earnings per share of $0.64 was down 6% from the year ago quarter. The primary driver of the reduced earnings in both periods is lower levels of accretion from PPP loans, as those loans have continued to decline due to success in executing the forgiveness process. Additionally, in the third quarter, charges associated with the Aquesta acquisition, such as merger charges and a $3.27 million provision to establish an initial allowance for credit losses for acquired Aquesta loans, reduced GAAP earnings by approximately $9 million or ten cents per share. On an operating basis, United’s ROA was 1.10% and its return on tangible common equity was 13.9%. On a pre-tax, pre-provision basis, operating return on assets was 1.40% for the quarter. Highlights for the quarter include strong annualized organic loan growth (excluding PPP and loans received through the Aquesta acquisition) of 7% and 17% annualized organic deposit growth.
Chairman and CEO Lynn Harton stated, “We are very pleased by United’s performance this quarter and in 2021. In the quarter, both loan and deposit growth were strong and noninterest income benefited from strong, but seasonally lower, mortgage production and a great SBA quarter.” Harton continued, “On the strategic front, we completed the acquisition of Aquesta Financial Holdings, Inc. and Aquesta Bank on October 1, boosting our Charlotte presence and adding the Wilmington, North Carolina market, both of which are growth markets that fit well with our footprint and culture. We also completed the operational conversion of Aquesta in mid-November, bringing the United brand to these great markets. We are proud that this outstanding team of bankers has joined us and we believe that they are a great fit for United. Finally, while not included in the quarterly results, on January 1 we completed the acquisition of Reliant Bancorp, Inc., expanding our Tennessee presence into the fast-growing Nashville MSA with a very high performance organization.”
Total loans increased by $569 million during the quarter—impacted by $501 million of loans from the Aquesta acquisition. Excluding the effect of PPP loans and loans received from the Aquesta acquisition, core organic loan growth was 7% annualized. Core transaction deposits grew by $948 million during the quarter, or 28% annualized. Excluding deposits received from the Aquesta acquisition, core transaction deposits grew by 10% annualized. United’s cost of deposits decreased by 1 basis point to 0.06%. The net interest margin decreased by 31 basis points from the third quarter due mainly to lower PPP loan fee accretion and an increase in liquid assets due to the continued deposit growth.
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Mr. Harton concluded, “I believe 2022 will be another great year for United. We enter the year with strong business momentum, led by an outstanding team of engaged bankers throughout the company. I am very proud that in October, and for the fifth consecutive year, United was named one of the Best Banks to Work for in 2021 across the nation by American Banker. One of our most important measures of success for us is to “Be a Great Place to Work for Great People”. Banking is a service and experience business and success begins with creating an organization where the best people can be fulfilled and build a career.”
2021 Financial Highlights:
| • | Full year EPS of $2.97, an increase of 55% compared to 2020; full year operating EPS of $3.09, an increase of 56% from 2020 |
| • | Return on assets of 1.37%, or 1.42% on an operating basis |
| • | Pre-tax, pre-provision return on assets of 1.65% on an operating basis |
| • | Return on common equity of 13.1% |
| • | Return on tangible common equity of 17.3% on an operating basis |
| • | Completed the mergers with FinTrust on July 1 and Aquesta Financial Corporation and its bank subsidiary Aquesta Bank on October 1 |
| • | A release of provision for credit losses of $37.6 million compared to a provision of $80.4 million in 2020, mostly due to the improved economic forecasts |
| • | Loan growth of $389 million or $346 million excluding loans acquired from Aquesta and PPP payoffs |
| • | Core transaction deposits were up $2.8 billion compared to 2020; excluding Aquesta, 2021 core transaction deposits were up $2.2 billion, or 19.2% |
| • | Net interest margin of 3.07%, which was down 48 basis points from last year due to a number of factors, including lower PPP fee accretion, the low rate environment, and increasing balance sheet liquidity |
| • | Continued strong mortgage rate locks of $3.1 billion compared to a record of $3.3 billion a year ago |
| • | Noninterest income was up $1.7 million or 1% as an increase in wealth management fees and gains from loan sales offset the $17.6 million decline in mortgage fees |
| • | Efficiency ratio of 55.8%, or 53.8% on an operating basis |
| • | Net charge-offs of $38,000 |
Fourth Quarter 2021 Financial Highlights:
| • | Net income of $52.0 million and pre-tax, pre-provision income of $65.6 million |
| • | EPS decreased by 17% compared to fourth quarter 2020 on a GAAP basis and 6% on an operating basis; compared to third quarter 2021, EPS decreased by 33% on a GAAP basis and 23% on an operating basis due to lower PPP accretion and a smaller provision release in the fourth quarter |
| • | Return on assets of 0.96%, or 1.10% on an operating basis |
| • | Pre-tax, pre-provision return on assets of 1.40% on an operating basis |
| • | Return on common equity of 9.3% |
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| • | Return on tangible common equity of 13.9% on an operating basis |
| • | A release of provision for credit losses of $647,000 which reduced the allowance for loan losses to 0.87% of loans from 0.89% in the third quarter |
| • | Loan production of $1.3 billion, resulting in core loan growth of 7%, annualized for the quarter, excluding the impact of $122 million in PPP loans being forgiven and the addition of $501 million in loans from Aquesta |
| • | Core transaction deposits were up $948 million; excluding Aquesta, fourth quarter core transaction deposits grew $333 million or 10% annualized |
| • | Net interest margin of 2.81% was down 31 basis points from the third quarter, due to lower PPP fee accretion, continued strong deposit growth and an earning asset mix change toward cash and securities |
| • | Mortgage closings of $522 million compared to $609 million a year ago; mortgage rate locks of $695 million compared to $792 million a year ago |
| • | Noninterest income was down $2.9 million on a linked quarter basis, primarily driven by lower mortgage fees |
| • | Noninterest expenses increased by $12.4 million compared to the third quarter on a GAAP basis and by $3.9 million on an operating basis, mostly due to adding the operating expenses of Aquesta which was acquired on October 1 |
| • | Efficiency ratio of 62.1%, or 56.5% on an operating basis |
| • | Net charge-offs of $248,000 or 1 basis point as a percent of average loans, down 1 basis point from the net charge-offs experienced in the third quarter |
| • | Nonperforming assets of 0.16% of total assets, down 7 basis points compared to September 30, 2021 |
| • | Quarterly common shareholder dividend of $0.20 per share declared during the quarter, an increase of 11% year-over-year |
| • | Completed the acquisition of Aquesta Financial Holdings, Inc. (“Aquesta”) with $756 million in assets on October 1, 2021; this acquisition is expected to add $0.08 in EPS accretion in 2022 with cost savings fully phased in |
| • | Completed the acquisition of Reliant Bancorp, Inc. (“Reliant”) with $3.0 billion in assets on January 1, 2022; this acquisition is expected to add $0.15 in EPS accretion in 2022 and $0.22 in 2023 with cost savings fully phased in |
Conference Call
United will hold a conference call on Wednesday, January 19, 2022, at 11 a.m. ET to discuss the contents of this press release and to share business highlights for the quarter. Participants can pre-register for the conference call by navigating to https://dpregister.com/sreg/10162699/f0590f1c98. Those without internet access or unable to pre-register may dial in by calling 1-866-777-2509. Participants are encouraged to dial in 15 minutes prior to the call start time. The conference call also will be webcast and available for replay for 30 days by selecting “Events & Presentations” within the Investor Relations section of United’s website at www.ucbi.com.
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UNITED COMMUNITY BANKS, INC.
Selected Financial Information
(in thousands, except per share data)
| 2021 | 2020 | Fourth Quarter |
For the Twelve Months Ended December 31, |
YTD 2021- | ||||||||||||||||||||||||||||||||
| Fourth Quarter |
Third Quarter |
Second Quarter |
First Quarter |
Fourth Quarter | 2021- 2020 Change |
2021 | 2020 | 2020 Change |
||||||||||||||||||||||||||||
| INCOME SUMMARY | ||||||||||||||||||||||||||||||||||||
| Interest revenue | $ | 143,768 | $ | 147,675 | $ | 145,809 | $ | 141,542 | $ | 156,071 | $ | 578,794 | $ | 557,996 | ||||||||||||||||||||||
| Interest expense | 6,213 | 6,636 | 7,433 | 9,478 | 10,676 | 29,760 | 56,237 | |||||||||||||||||||||||||||||
| Net interest revenue | 137,555 | 141,039 | 138,376 | 132,064 | 145,395 | (5 | )% | 549,034 | 501,759 | 9 | % | |||||||||||||||||||||||||
| (Release of) provision for credit losses | (647 | ) | (11,034 | ) | (13,588 | ) | (12,281 | ) | 2,907 | (37,550 | ) | 80,434 | ||||||||||||||||||||||||
| Noninterest income | 37,177 | 40,095 | 35,841 | 44,705 | 41,375 | (10 | ) | 157,818 | 156,109 | 1 | ||||||||||||||||||||||||||
| Total revenue | 175,379 | 192,168 | 187,805 | 189,050 | 183,863 | (5 | ) | 744,402 | 577,434 | 29 | ||||||||||||||||||||||||||
| Expenses | 109,156 | 96,749 | 95,540 | 95,194 | 106,490 | 3 | 396,639 | 367,989 | 8 | |||||||||||||||||||||||||||
| Income before income tax expense | 66,223 | 95,419 | 92,265 | 93,856 | 77,373 | 347,763 | 209,445 | |||||||||||||||||||||||||||||
| Income tax expense | 14,204 | 21,603 | 22,005 | 20,150 | 17,871 | 77,962 | 45,356 | |||||||||||||||||||||||||||||
| Net income | 52,019 | 73,816 | 70,260 | 73,706 | 59,502 | 269,801 | 164,089 | |||||||||||||||||||||||||||||
| Merger-related and other charges | 9,912 | 1,437 | 1,078 | 1,543 | 2,452 | 13,970 | 7,018 | |||||||||||||||||||||||||||||
| Income tax benefit of merger-related and other charges | (2,265 | ) | (328 | ) | (246 | ) | (335 | ) | (552 | ) | (3,174 | ) | (1,340 | ) | ||||||||||||||||||||||
| Net income - operating (1) | $ | 59,666 | $ | 74,925 | $ | 71,092 | $ | 74,914 | $ | 61,402 | (3 | ) | $ | 280,597 | $ | 169,767 | 65 | |||||||||||||||||||
| Pre-tax pre-provision income (5) | $ | 65,576 | $ | 84,385 | $ | 78,677 | $ | 81,575 | $ | 80,280 | (18 | ) | $ | 310,213 | $ | 289,879 | 7 | |||||||||||||||||||
| PERFORMANCE MEASURES | ||||||||||||||||||||||||||||||||||||
| Per common share: | ||||||||||||||||||||||||||||||||||||
| Diluted net income - GAAP | $ | 0.55 | $ | 0.82 | $ | 0.78 | $ | 0.82 | $ | 0.66 | (17 | ) | $ | 2.97 | $ | 1.91 | 55 | |||||||||||||||||||
| Diluted net income - operating (1) | 0.64 | 0.83 | 0.79 | 0.83 | 0.68 | (6 | ) | 3.09 | 1.98 | 56 | ||||||||||||||||||||||||||
| Common stock cash dividends declared | 0.20 | 0.20 | 0.19 | 0.19 | 0.18 | 11 | 0.78 | 0.72 | 8 | |||||||||||||||||||||||||||
| Book value | 23.63 | 23.25 | 22.81 | 22.15 | 21.90 | 8 | 23.63 | 21.90 | 8 | |||||||||||||||||||||||||||
| Tangible book value (3) | 18.42 | 18.68 | 18.49 | 17.83 | 17.56 | 5 | 18.42 | 17.56 | 5 | |||||||||||||||||||||||||||
| Key performance ratios: | ||||||||||||||||||||||||||||||||||||
| Return on common equity - GAAP (2)(4) | 9.32 | % | 14.26 | % | 14.08 | % | 15.37 | % | 12.36 | % | 13.14 | % | 9.25 | % | ||||||||||||||||||||||
| Return on common equity - operating (1)(2)(4) | 10.74 | 14.48 | 14.25 | 15.63 | 12.77 | 13.68 | 9.58 | |||||||||||||||||||||||||||||
| Return on tangible common equity - operating (1)(2)(3)(4) | 13.93 | 18.23 | 17.81 | 19.68 | 16.23 | 17.33 | 12.24 | |||||||||||||||||||||||||||||
| Return on assets - GAAP (4) | 0.96 | 1.48 | 1.46 | 1.62 | 1.30 | 1.37 | 1.04 | |||||||||||||||||||||||||||||
| Return on assets - operating (1)(4) | 1.10 | 1.50 | 1.48 | 1.65 | 1.34 | 1.42 | 1.07 | |||||||||||||||||||||||||||||
| Return on assets -pre-tax pre-provision (4)(5) | 1.21 | 1.70 | 1.64 | 1.80 | 1.77 | 1.58 | 1.85 | |||||||||||||||||||||||||||||
| Return on assets -pre-tax pre-provision, excluding merger related and other charges (1)(4)(5) | 1.40 | 1.73 | 1.67 | 1.83 | 1.82 | 1.65 | 1.90 | |||||||||||||||||||||||||||||
| Net interest margin (fully taxable equivalent) (4) | 2.81 | 3.12 | 3.19 | 3.22 | 3.55 | 3.07 | 3.55 | |||||||||||||||||||||||||||||
| Efficiency ratio - GAAP | 62.12 | 53.11 | 54.53 | 53.55 | 56.73 | 55.80 | 55.71 | |||||||||||||||||||||||||||||
| Efficiency ratio - operating (1) | 56.48 | 52.33 | 53.92 | 52.68 | 55.42 | 53.83 | 54.64 | |||||||||||||||||||||||||||||
| Equity to total assets | 10.61 | 10.89 | 11.04 | 10.95 | 11.29 | 10.61 | 11.29 | |||||||||||||||||||||||||||||
| Tangible common equity to tangible assets (3) | 8.09 | 8.53 | 8.71 | 8.57 | 8.81 | 8.09 | 8.81 | |||||||||||||||||||||||||||||
| ASSET QUALITY | ||||||||||||||||||||||||||||||||||||
| Nonperforming loans | $ | 32,812 | $ | 44,923 | $ | 46,123 | $ | 55,900 | $ | 61,599 | (47 | ) | $ | 32,812 | $ | 61,599 | (47 | ) | ||||||||||||||||||
| Foreclosed properties | 43 | 412 | 224 | 596 | 647 | (93 | ) | 43 | 647 | (93 | ) | |||||||||||||||||||||||||
| Total nonperforming assets (“NPAs”) | 32,855 | 45,335 | 46,347 | 56,496 | 62,246 | (47 | ) | 32,855 | 62,246 | (47 | ) | |||||||||||||||||||||||||
| Allowance for credit losses - loans and leases | 102,532 | 99,620 | 111,616 | 126,866 | 137,010 | (25 | ) | 102,532 | 137,010 | (25 | ) | |||||||||||||||||||||||||
| Allowance for credit losses - total | 113,524 | 110,875 | 122,460 | 135,592 | 147,568 | (23 | ) | 113,524 | 147,568 | (23 | ) | |||||||||||||||||||||||||
| Net charge-offs | 248 | 551 | (456 | ) | (305 | ) | 1,515 | (84 | ) | 38 | 18,316 | (100 | ) | |||||||||||||||||||||||
| Allowance for credit losses - loans and leases to loans | 0.87 | % | 0.89 | % | 0.98 | % | 1.09 | % | 1.20 | % | 0.87 | % | 1.20 | % | ||||||||||||||||||||||
| Allowance for credit losses - total to loans | 0.97 | 0.99 | 1.08 | 1.16 | 1.30 | 0.97 | 1.30 | |||||||||||||||||||||||||||||
| Net charge-offs to average loans (4) | 0.01 | 0.02 | (0.02 | ) | (0.01 | ) | 0.05 | — | 0.17 | |||||||||||||||||||||||||||
| NPAs to loans and foreclosed properties | 0.28 | 0.41 | 0.41 | 0.48 | 0.55 | 0.28 | 0.55 | |||||||||||||||||||||||||||||
| NPAs to total assets | 0.16 | 0.23 | 0.25 | 0.30 | 0.35 | 0.16 | 0.35 | |||||||||||||||||||||||||||||
| AVERAGE BALANCES ($ in millions) | ||||||||||||||||||||||||||||||||||||
| Loans | $ | 11,689 | $ | 11,205 | $ | 11,617 | $ | 11,433 | $ | 11,595 | 1 | $ | 11,486 | $ | 10,467 | 10 | ||||||||||||||||||||
| Investment securities | 5,544 | 5,122 | 4,631 | 3,991 | 3,326 | 67 | 4,830 | 2,752 | 76 | |||||||||||||||||||||||||||
| Earning assets | 19,542 | 18,078 | 17,540 | 16,782 | 16,394 | 19 | 17,996 | 14,226 | 27 | |||||||||||||||||||||||||||
| Total assets | 20,863 | 19,322 | 18,792 | 18,023 | 17,698 | 18 | 19,258 | 15,467 | 25 | |||||||||||||||||||||||||||
| Deposits | 18,037 | 16,637 | 16,132 | 15,366 | 15,057 | 20 | 16,550 | 13,135 | 26 | |||||||||||||||||||||||||||
| Shareholders’ equity | 2,223 | 2,119 | 2,060 | 2,025 | 1,994 | 11 | 2,107 | 1,821 | 16 | |||||||||||||||||||||||||||
| Common shares - basic (thousands) | 89,916 | 87,211 | 87,289 | 87,322 | 87,258 | 3 | 87,940 | 83,184 | 6 | |||||||||||||||||||||||||||
| Common shares - diluted (thousands) | 90,089 | 87,355 | 87,421 | 87,466 | 87,333 | 3 | 88,097 | 83,248 | 6 | |||||||||||||||||||||||||||
| AT PERIOD END ($ in millions) | ||||||||||||||||||||||||||||||||||||
| Loans | $ | 11,760 | $ | 11,191 | $ | 11,391 | $ | 11,679 | $ | 11,371 | 3 | $ | 11,760 | $ | 11,371 | 3 | ||||||||||||||||||||
| Investment securities | 5,653 | 5,335 | 4,928 | 4,332 | 3,645 | 55 | 5,653 | 3,645 | 55 | |||||||||||||||||||||||||||
| Total assets | 20,947 | 19,481 | 18,896 | 18,557 | 17,794 | 18 | 20,947 | 17,794 | 18 | |||||||||||||||||||||||||||
| Deposits | 18,241 | 16,865 | 16,328 | 15,993 | 15,232 | 20 | 18,241 | 15,232 | 20 | |||||||||||||||||||||||||||
| Shareholders’ equity | 2,222 | 2,122 | 2,086 | 2,031 | 2,008 | 11 | 2,222 | 2,008 | 11 | |||||||||||||||||||||||||||
| Common shares outstanding (thousands) | 89,350 | 86,559 | 86,665 | 86,777 | 86,675 | 3 | 89,350 | 86,675 | 3 | |||||||||||||||||||||||||||
(1) Excludes merger-related and other charges.
(2) Net income less preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).
(3) Excludes effect of acquisition related intangibles and associated amortization.
(4) Annualized. (5) Excludes income tax expense and provision for credit losses.
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UNITED COMMUNITY BANKS, INC.
Non-GAAP Performance Measures Reconciliation Selected Financial Information
(in thousands, except per share data)
| 2021 | 2020 | Twelve Months Ended December 31, | ||||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | Second Quarter | First Quarter | Fourth Quarter | 2021 | 2020 | ||||||||||||||||||||||
| Expense reconciliation | ||||||||||||||||||||||||||||
| Expenses (GAAP) | $ | 109,156 | $ | 96,749 | $ | 95,540 | $ | 95,194 | $ | 106,490 | $ | 396,639 | $ | 367,989 | ||||||||||||||
| Merger-related and other charges | (9,912 | ) | (1,437 | ) | (1,078 | ) | (1,543 | ) | (2,452 | ) | (13,970 | ) | (7,018 | ) | ||||||||||||||
| Expenses - operating | $ | 99,244 | $ | 95,312 | $ | 94,462 | $ | 93,651 | $ | 104,038 | $ | 382,669 | $ | 360,971 | ||||||||||||||
| Net income to operating income reconciliation | ||||||||||||||||||||||||||||
| Net income (GAAP) | $ | 52,019 | $ | 73,816 | $ | 70,260 | $ | 73,706 | $ | 59,502 | $ | 269,801 | $ | 164,089 | ||||||||||||||
| Merger-related and other charges | 9,912 | 1,437 | 1,078 | 1,543 | 2,452 | 13,970 | 7,018 | |||||||||||||||||||||
| Income tax benefit of merger-related and other charges | (2,265 | ) | (328 | ) | (246 | ) | (335 | ) | (552 | ) | (3,174 | ) | (1,340 | ) | ||||||||||||||
| Net income - operating | $ | 59,666 | $ | 74,925 | $ | 71,092 | $ | 74,914 | $ | 61,402 | $ | 280,597 | $ | 169,767 | ||||||||||||||
| Net income to pre-tax pre-provision income reconciliation | ||||||||||||||||||||||||||||
| Net income (GAAP) | $ | 52,019 | $ | 73,816 | $ | 70,260 | $ | 73,706 | $ | 59,502 | $ | 269,801 | $ | 164,089 | ||||||||||||||
| Income tax expense | 14,204 | 21,603 | 22,005 | 20,150 | 17,871 | 77,962 | 45,356 | |||||||||||||||||||||
| (Release of) provision for credit losses | (647 | ) | (11,034 | ) | (13,588 | ) | (12,281 | ) | 2,907 | (37,550 | ) | 80,434 | ||||||||||||||||
| Pre-tax pre-provision income | $ | 65,576 | $ | 84,385 | $ | 78,677 | $ | 81,575 | $ | 80,280 | $ | 310,213 | $ | 289,879 | ||||||||||||||
| Diluted income per common share reconciliation | ||||||||||||||||||||||||||||
| Diluted income per common share (GAAP) | $ | 0.55 | $ | 0.82 | $ | 0.78 | $ | 0.82 | $ | 0.66 | $ | 2.97 | $ | 1.91 | ||||||||||||||
| Merger-related and other charges | 0.09 | 0.01 | 0.01 | 0.01 | 0.02 | 0.12 | 0.07 | |||||||||||||||||||||
| Diluted income per common share - operating | $ | 0.64 | $ | 0.83 | $ | 0.79 | $ | 0.83 | $ | 0.68 | $ | 3.09 | $ | 1.98 | ||||||||||||||
| Book value per common share reconciliation | ||||||||||||||||||||||||||||
| Book value per common share (GAAP) | $ | 23.63 | $ | 23.25 | $ | 22.81 | $ | 22.15 | $ | 21.90 | $ | 23.63 | $ | 21.90 | ||||||||||||||
| Effect of goodwill and other intangibles | (5.21 | ) | (4.57 | ) | (4.32 | ) | (4.32 | ) | (4.34 | ) | (5.21 | ) | (4.34 | ) | ||||||||||||||
| Tangible book value per common share | $ | 18.42 | $ | 18.68 | $ | 18.49 | $ | 17.83 | $ | 17.56 | $ | 18.42 | $ | 17.56 | ||||||||||||||
| Return on tangible common equity reconciliation | ||||||||||||||||||||||||||||
| Return on common equity (GAAP) | 9.32 | % | 14.26 | % | 14.08 | % | 15.37 | % | 12.36 | % | 13.14 | % | 9.25 | % | ||||||||||||||
| Merger-related and other charges | 1.42 | 0.22 | 0.17 | 0.26 | 0.41 | 0.54 | 0.33 | |||||||||||||||||||||
| Return on common equity - operating | 10.74 | 14.48 | 14.25 | 15.63 | 12.77 | 13.68 | 9.58 | |||||||||||||||||||||
| Effect of goodwill and other intangibles | 3.19 | 3.75 | 3.56 | 4.05 | 3.46 | 3.65 | 2.66 | |||||||||||||||||||||
| Return on tangible common equity - operating | 13.93 | % | 18.23 | % | 17.81 | % | 19.68 | % | 16.23 | % | 17.33 | % | 12.24 | % | ||||||||||||||
| Return on assets reconciliation | ||||||||||||||||||||||||||||
| Return on assets (GAAP) | 0.96 | % | 1.48 | % | 1.46 | % | 1.62 | % | 1.30 | % | 1.37 | % | 1.04 | % | ||||||||||||||
| Merger-related and other charges | 0.14 | 0.02 | 0.02 | 0.03 | 0.04 | 0.05 | 0.03 | |||||||||||||||||||||
| Return on assets - operating | 1.10 | % | 1.50 | % | 1.48 | % | 1.65 | % | 1.34 | % | 1.42 | % | 1.07 | % | ||||||||||||||
| Return on assets to return on assets- pre-tax pre-provision reconciliation | ||||||||||||||||||||||||||||
| Return on assets (GAAP) | 0.96 | % | 1.48 | % | 1.46 | % | 1.62 | % | 1.30 | % | 1.37 | % | 1.04 | % | ||||||||||||||
| Income tax expense | 0.26 | 0.45 | 0.47 | 0.46 | 0.40 | 0.40 | 0.29 | |||||||||||||||||||||
| (Release of) provision for credit losses | (0.01 | ) | (0.23 | ) | (0.29 | ) | (0.28 | ) | 0.07 | (0.19 | ) | 0.52 | ||||||||||||||||
| Return on assets - pre-tax pre-provision | 1.21 | 1.70 | 1.64 | 1.80 | 1.77 | 1.58 | 1.85 | |||||||||||||||||||||
| Merger-related and other charges | 0.19 | 0.03 | 0.03 | 0.03 | 0.05 | 0.07 | 0.05 | |||||||||||||||||||||
| Return on assets - pre-tax pre-provision, excluding merger-related and other charges | 1.40 | % | 1.73 | % | 1.67 | % | 1.83 | % | 1.82 | % | 1.65 | % | 1.90 | % | ||||||||||||||
| Efficiency ratio reconciliation | ||||||||||||||||||||||||||||
| Efficiency ratio (GAAP) | 62.12 | % | 53.11 | % | 54.53 | % | 53.55 | % | 56.73 | % | 55.80 | % | 55.71 | % | ||||||||||||||
| Merger-related and other charges | (5.64 | ) | (0.78 | ) | (0.61 | ) | (0.87 | ) | (1.31 | ) | (1.97 | ) | (1.07 | ) | ||||||||||||||
| Efficiency ratio - operating | 56.48 | % | 52.33 | % | 53.92 | % | 52.68 | % | 55.42 | % | 53.83 | % | 54.64 | % | ||||||||||||||
| Tangible common equity to tangible assets reconciliation | ||||||||||||||||||||||||||||
| Equity to total assets (GAAP) | 10.61 | % | 10.89 | % | 11.04 | % | 10.95 | % | 11.29 | % | 10.61 | % | 11.29 | % | ||||||||||||||
| Effect of goodwill and other intangibles | (2.06 | ) | (1.87 | ) | (1.82 | ) | (1.86 | ) | (1.94 | ) | (2.06 | ) | (1.94 | ) | ||||||||||||||
| Effect of preferred equity | (0.46 | ) | (0.49 | ) | (0.51 | ) | (0.52 | ) | (0.54 | ) | (0.46 | ) | (0.54 | ) | ||||||||||||||
| Tangible common equity to tangible assets | 8.09 | % | 8.53 | % | 8.71 | % | 8.57 | % | 8.81 | % | 8.09 | % | 8.81 | % | ||||||||||||||
| Allowance for credit losses - total to loans reconciliation | ||||||||||||||||||||||||||||
| Allowance for credit losses - total to loans (GAAP) | 0.97 | % | 0.99 | % | 1.08 | % | 1.16 | % | 1.30 | % | 0.97 | % | 1.30 | % | ||||||||||||||
| Effect of PPP loans | — | 0.01 | 0.04 | 0.10 | 0.08 | — | 0.08 | |||||||||||||||||||||
| Allowance for credit losses - total to loans, excluding PPP loans | 0.97 | % | 1.00 | % | 1.12 | % | 1.26 | % | 1.38 | % | 0.97 | % | 1.38 | % | ||||||||||||||
5
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End
(in millions)
| 2021 | 2020 | Linked | Year over | |||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | Second Quarter | First Quarter | Fourth Quarter | Quarter Change | Year Change | ||||||||||||||||||||||
| LOANS BY CATEGORY | ||||||||||||||||||||||||||||
| Owner occupied commercial RE | $ | 2,322 | $ | 2,149 | $ | 2,149 | $ | 2,107 | $ | 2,090 | $ | 173 | $ | 232 | ||||||||||||||
| Income producing commercial RE | 2,601 | 2,542 | 2,550 | 2,599 | 2,541 | 59 | 60 | |||||||||||||||||||||
| Commercial & industrial | 1,822 | 1,729 | 1,762 | 1,760 | 1,853 | 93 | (31 | ) | ||||||||||||||||||||
| Paycheck protection program | 88 | 150 | 472 | 883 | 646 | (62 | ) | (558 | ) | |||||||||||||||||||
| Commercial construction | 1,015 | 947 | 927 | 960 | 967 | 68 | 48 | |||||||||||||||||||||
| Equipment financing | 1,083 | 1,017 | 969 | 913 | 864 | 66 | 219 | |||||||||||||||||||||
| Total commercial | 8,931 | 8,534 | 8,829 | 9,222 | 8,961 | 397 | (30 | ) | ||||||||||||||||||||
| Residential mortgage | 1,638 | 1,533 | 1,473 | 1,362 | 1,285 | 105 | 353 | |||||||||||||||||||||
| Home equity lines of credit | 694 | 661 | 661 | 679 | 697 | 33 | (3 | ) | ||||||||||||||||||||
| Residential construction | 359 | 321 | 289 | 272 | 281 | 38 | 78 | |||||||||||||||||||||
| Consumer | 138 | 142 | 139 | 144 | 147 | (4 | ) | (9 | ) | |||||||||||||||||||
| Total loans | $ | 11,760 | $ | 11,191 | $ | 11,391 | $ | 11,679 | $ | 11,371 | $ | 569 | $ | 389 | ||||||||||||||
| LOANS BY MARKET (1) | ||||||||||||||||||||||||||||
| North Georgia | $ | 944 | $ | 961 | $ | 962 | $ | 982 | $ | 955 | $ | (17 | ) | $ | (11 | ) | ||||||||||||
| Atlanta | 2,030 | 1,930 | 1,938 | 1,953 | 1,889 | 100 | 141 | |||||||||||||||||||||
| North Carolina | 1,895 | 1,427 | 1,374 | 1,326 | 1,281 | 468 | 614 | |||||||||||||||||||||
| Coastal Georgia | 588 | 621 | 605 | 597 | 617 | (33 | ) | (29 | ) | |||||||||||||||||||
| Gainesville | 216 | 220 | 224 | 222 | 224 | (4 | ) | (8 | ) | |||||||||||||||||||
| East Tennessee | 373 | 383 | 394 | 398 | 415 | (10 | ) | (42 | ) | |||||||||||||||||||
| South Carolina | 2,235 | 2,145 | 2,107 | 1,997 | 1,947 | 90 | 288 | |||||||||||||||||||||
| Florida | 1,148 | 1,113 | 1,141 | 1,160 | 1,435 | 35 | (287 | ) | ||||||||||||||||||||
| Commercial Banking Solutions | 2,331 | 2,391 | 2,646 | 3,044 | 2,608 | (60 | ) | (277 | ) | |||||||||||||||||||
| Total loans | $ | 11,760 | $ | 11,191 | $ | 11,391 | $ | 11,679 | $ | 11,371 | $ | 569 | $ | 389 | ||||||||||||||
6
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Year-End
(in millions)
| 2021 | 2020 | 2019 | 2018 | 2017 | ||||||||||||||||
| LOANS BY CATEGORY | ||||||||||||||||||||
| Owner occupied commercial RE | $ | 2,322 | $ | 2,090 | $ | 1,720 | $ | 1,648 | $ | 1,924 | ||||||||||
| Income producing commercial RE | 2,601 | 2,541 | 2,008 | 1,812 | 1,595 | |||||||||||||||
| Commercial & industrial | 1,822 | 1,853 | 1,221 | 1,278 | 1,131 | |||||||||||||||
| Paycheck protection program | 88 | 646 | — | — | — | |||||||||||||||
| Commercial construction | 1,015 | 967 | 976 | 796 | 712 | |||||||||||||||
| Equipment financing | 1,083 | 864 | 745 | 565 | — | |||||||||||||||
| Total commercial | 8,931 | 8,961 | 6,670 | 6,099 | 5,362 | |||||||||||||||
| Residential mortgage | 1,638 | 1,285 | 1,118 | 1,049 | 974 | |||||||||||||||
| Home equity lines of credit | 694 | 697 | 661 | 694 | 731 | |||||||||||||||
| Residential construction | 359 | 281 | 236 | 211 | 183 | |||||||||||||||
| Consumer | 138 | 147 | 128 | 330 | 486 | |||||||||||||||
| Total loans | $ | 11,760 | $ | 11,371 | $ | 8,813 | $ | 8,383 | $ | 7,736 | ||||||||||
| LOANS BY MARKET | ||||||||||||||||||||
| North Georgia | $ | 944 | $ | 955 | $ | 967 | $ | 981 | $ | 1,019 | ||||||||||
| Atlanta | 2,030 | 1,889 | 1,762 | 1,507 | 1,510 | |||||||||||||||
| North Carolina | 1,895 | 1,281 | 1,156 | 1,072 | 1,049 | |||||||||||||||
| Coastal Georgia | 588 | 617 | 631 | 588 | 630 | |||||||||||||||
| Gainesville | 216 | 224 | 246 | 247 | 248 | |||||||||||||||
| East Tennessee | 373 | 415 | 421 | 477 | 475 | |||||||||||||||
| South Carolina | 2,235 | 1,947 | 1,708 | 1,645 | 1,486 | |||||||||||||||
| Florida | 1,148 | 1,435 | — | — | — | |||||||||||||||
| Commercial Banking Solutions | 2,331 | 2,608 | 1,922 | 1,658 | 961 | |||||||||||||||
| Indirect auto | — | — | — | 208 | 358 | |||||||||||||||
| Total loans | $ | 11,760 | $ | 11,371 | $ | 8,813 | $ | 8,383 | $ | 7,736 | ||||||||||
7
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality
(in thousands)
| 2021 | ||||||||||||
| Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| NONACCRUAL LOANS | ||||||||||||
| Owner occupied RE | $ | 2,714 | $ | 4,945 | $ | 6,128 | ||||||
| Income producing RE | 7,588 | 13,462 | 13,100 | |||||||||
| Commercial & industrial | 5,429 | 8,507 | 8,563 | |||||||||
| Commercial construction | 343 | 1,202 | 1,229 | |||||||||
| Equipment financing | 1,741 | 1,845 | 1,771 | |||||||||
| Total commercial | 17,815 | 29,961 | 30,791 | |||||||||
| Residential mortgage | 13,313 | 13,222 | 13,485 | |||||||||
| Home equity lines of credit | 1,212 | 1,364 | 1,433 | |||||||||
| Residential construction | 420 | 260 | 307 | |||||||||
| Consumer | 52 | 116 | 107 | |||||||||
| Total | $ | 32,812 | $ | 44,923 | $ | 46,123 | ||||||
| 2021 | ||||||||||||||||||||||||
| Fourth Quarter | Third Quarter | Second Quarter | ||||||||||||||||||||||
| (in thousands) | Net Charge- Offs | Net Charge- Offs to Average Loans (1) | Net Charge- Offs | Net Charge- Offs to Average Loans (1) | Net Charge- Offs | Net Charge- Offs to Average Loans (1) | ||||||||||||||||||
| NET CHARGE-OFFS BY CATEGORY | ||||||||||||||||||||||||
| Owner occupied RE | $ | (255 | ) | (0.04 | )% | $ | (93 | ) | (0.02 | )% | $ | (103 | ) | (0.02 | )% | |||||||||
| Income producing RE | (98 | ) | (0.01 | ) | 45 | 0.01 | (213 | ) | (0.03 | ) | ||||||||||||||
| Commercial & industrial | 339 | 0.07 | (91 | ) | (0.02 | ) | 60 | 0.01 | ||||||||||||||||
| Commercial construction | (354 | ) | (0.14 | ) | (123 | ) | (0.05 | ) | (293 | ) | (0.12 | ) | ||||||||||||
| Equipment financing | 781 | 0.29 | 512 | 0.21 | 301 | 0.13 | ||||||||||||||||||
| Total commercial | 413 | 0.02 | 250 | 0.01 | (248 | ) | (0.01 | ) | ||||||||||||||||
| Residential mortgage | (169 | ) | (0.04 | ) | 51 | 0.01 | (194 | ) | (0.05 | ) | ||||||||||||||
| Home equity lines of credit | (118 | ) | (0.07 | ) | (102 | ) | (0.06 | ) | (112 | ) | (0.07 | ) | ||||||||||||
| Residential construction | (17 | ) | (0.02 | ) | (37 | ) | (0.05 | ) | (33 | ) | (0.05 | ) | ||||||||||||
| Consumer | 139 | 0.39 | 389 | 1.11 | 131 | 0.37 | ||||||||||||||||||
| Total | $ | 248 | 0.01 | $ | 551 | 0.02 | $ | (456 | ) | (0.02 | ) | |||||||||||||
| (1) | Annualized. |
8
UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheets (Unaudited)
(in thousands, except share and per share data)
| December 31, 2021 | December 31, 2020 | |||||||
| ASSETS | ||||||||
| Cash and due from banks | $ | 144,244 | $ | 148,896 | ||||
| Interest-bearing deposits in banks | 2,147,266 | 1,459,723 | ||||||
| Federal funds and other short-term investments | 27,000 | — | ||||||
| Cash and cash equivalents | 2,318,510 | 1,608,619 | ||||||
| Debt securities available-for-sale | 4,496,824 | 3,224,721 | ||||||
| Debt securities held-to-maturity (fair value $1,148,804 and $437,193, respectively) | 1,156,098 | 420,361 | ||||||
| Loans held for sale at fair value | 44,109 | 105,433 | ||||||
| Loans and leases held for investment | 11,760,346 | 11,370,815 | ||||||
| Less allowance for credit losses - loans and leases | (102,532 | ) | (137,010 | ) | ||||
| Loans and leases, net | 11,657,814 | 11,233,805 | ||||||
| Premises and equipment, net | 245,296 | 218,489 | ||||||
| Bank owned life insurance | 217,713 | 201,969 | ||||||
| Accrued interest receivable | 42,999 | 47,672 | ||||||
| Net deferred tax asset | 41,322 | 38,411 | ||||||
| Derivative financial instruments | 42,480 | 86,666 | ||||||
| Goodwill and other intangible assets, net | 472,407 | 381,823 | ||||||
| Other assets | 211,199 | 226,405 | ||||||
| Total assets | $ | 20,946,771 | $ | 17,794,374 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Liabilities: | ||||||||
| Deposits: | ||||||||
| Noninterest-bearing demand | $ | 6,956,981 | $ | 5,390,291 | ||||
| NOW and interest-bearing demand | 4,252,209 | 3,346,490 | ||||||
| Money market | 4,183,354 | 3,550,335 | ||||||
| Savings | 1,215,779 | 950,854 | ||||||
| Time | 1,442,498 | 1,704,290 | ||||||
| Brokered | 190,358 | 290,098 | ||||||
| Total deposits | 18,241,179 | 15,232,358 | ||||||
| Long-term debt | 247,360 | 326,956 | ||||||
| Derivative financial instruments | 25,145 | 29,003 | ||||||
| Accrued expenses and other liabilities | 210,842 | 198,527 | ||||||
| Total liabilities | 18,724,526 | 15,786,844 | ||||||
| Shareholders' equity: | ||||||||
| Preferred stock, $1 par value: 10,000,000 shares authorized; Series I, $25,000 per share liquidation preference; 4,000 shares issued and outstanding | 96,422 | 96,422 | ||||||
| Common stock, $1 par value; 200,000,000 and 150,000,000 shares authorized, respectively; 89,349,826 and 86,675,279 shares issued and outstanding, respectively | 89,350 | 86,675 | ||||||
| Common stock issuable; 595,705 and 600,834 shares, respectively | 11,288 | 10,855 | ||||||
| Capital surplus | 1,721,007 | 1,638,999 | ||||||
| Retained earnings | 330,654 | 136,869 | ||||||
| Accumulated other comprehensive (loss) income | (26,476 | ) | 37,710 | |||||
| Total shareholders’ equity | 2,222,245 | 2,007,530 | ||||||
| Total liabilities and shareholders’ equity | $ | 20,946,771 | $ | 17,794,374 | ||||
9
UNITED COMMUNITY BANKS, INC.
Consolidated Statements of Income (Unaudited)
(in thousands, except per share data)
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| Interest revenue: | ||||||||||||||||
| Loans, including fees | $ | 123,473 | $ | 141,351 | $ | 505,734 | $ | 494,212 | ||||||||
| Investment securities, including tax exempt of $2,293, $2,055, $8,978 and $7,043 | 19,442 | 14,507 | 70,972 | 62,074 | ||||||||||||
| Deposits in banks and short-term investments | 853 | 213 | 2,088 | 1,710 | ||||||||||||
| Total interest revenue | 143,768 | 156,071 | 578,794 | 557,996 | ||||||||||||
| Interest expense: | ||||||||||||||||
| Deposits: | ||||||||||||||||
| NOW and interest-bearing demand | 1,310 | 1,495 | 5,468 | 7,735 | ||||||||||||
| Money market | 1,102 | 2,196 | 5,380 | 13,165 | ||||||||||||
| Savings | 60 | 48 | 217 | 169 | ||||||||||||
| Time | 392 | 2,689 | 3,780 | 20,703 | ||||||||||||
| Deposits | 2,864 | 6,428 | 14,845 | 41,772 | ||||||||||||
| Short-term borrowings | — | — | — | 3 | ||||||||||||
| Federal Home Loan Bank advances | 1 | — | 3 | 28 | ||||||||||||
| Long-term debt | 3,348 | 4,248 | 14,912 | 14,434 | ||||||||||||
| Total interest expense | 6,213 | 10,676 | 29,760 | 56,237 | ||||||||||||
| Net interest revenue | 137,555 | 145,395 | 549,034 | 501,759 | ||||||||||||
| Provision for credit losses | (647 | ) | 2,907 | (37,550 | ) | 80,434 | ||||||||||
| Net interest revenue after provision for credit losses | 138,202 | 142,488 | 586,584 | 421,325 | ||||||||||||
| Noninterest income: | ||||||||||||||||
| Service charges and fees | 8,613 | 8,508 | 33,868 | 32,401 | ||||||||||||
| Mortgage loan gains and related fees | 10,910 | 18,974 | 58,446 | 76,087 | ||||||||||||
| Wealth management fees | 6,117 | 3,221 | 18,998 | 9,240 | ||||||||||||
| Gains from other loan sales, net | 3,761 | 1,531 | 11,267 | 5,420 | ||||||||||||
| Securities gains, net | 42 | 2 | 83 | 748 | ||||||||||||
| Other | 7,734 | 9,139 | 35,156 | 32,213 | ||||||||||||
| Total noninterest income | 37,177 | 41,375 | 157,818 | 156,109 | ||||||||||||
| Total revenue | 175,379 | 183,863 | 744,402 | 577,434 | ||||||||||||
| Noninterest expenses: | ||||||||||||||||
| Salaries and employee benefits | 60,986 | 61,824 | 241,443 | 224,060 | ||||||||||||
| Occupancy | 7,489 | 7,082 | 28,619 | 25,791 | ||||||||||||
| Communications and equipment | 7,850 | 7,687 | 29,829 | 27,149 | ||||||||||||
| FDIC assessments and other regulatory charges | 1,878 | 1,594 | 7,398 | 5,982 | ||||||||||||
| Professional fees | 6,080 | 4,029 | 20,589 | 18,032 | ||||||||||||
| Lending and loan servicing expense | 2,351 | 2,468 | 10,859 | 10,993 | ||||||||||||
| Outside services - electronic banking | 2,670 | 1,997 | 9,481 | 7,513 | ||||||||||||
| Postage, printing and supplies | 1,939 | 1,793 | 7,110 | 6,779 | ||||||||||||
| Advertising and public relations | 1,760 | 9,891 | 5,910 | 15,203 | ||||||||||||
| Amortization of intangibles | 1,103 | 1,042 | 4,045 | 4,168 | ||||||||||||
| Merger-related and other charges | 9,912 | 2,452 | 13,970 | 7,018 | ||||||||||||
| Other | 5,138 | 4,631 | 17,386 | 15,301 | ||||||||||||
| Total noninterest expenses | 109,156 | 106,490 | 396,639 | 367,989 | ||||||||||||
| Net income before income taxes | 66,223 | 77,373 | 347,763 | 209,445 | ||||||||||||
| Income tax expense | 14,204 | 17,871 | 77,962 | 45,356 | ||||||||||||
| Net income | $ | 52,019 | $ | 59,502 | $ | 269,801 | $ | 164,089 | ||||||||
| Preferred stock dividends | 1,718 | 1,719 | 6,875 | 3,533 | ||||||||||||
| Earnings allocated to participating securities | 317 | 532 | 1,657 | 1,287 | ||||||||||||
| Net income available to common shareholders | $ | 49,984 | $ | 57,251 | $ | 261,269 | $ | 159,269 | ||||||||
| Net income per common share: | ||||||||||||||||
| Basic | $ | 0.56 | $ | 0.66 | $ | 2.97 | $ | 1.91 | ||||||||
| Diluted | 0.55 | 0.66 | 2.97 | 1.91 | ||||||||||||
| Weighted average common shares outstanding: | ||||||||||||||||
| Basic | 89,916 | 87,258 | 87,940 | 83,184 | ||||||||||||
| Diluted | 90,089 | 87,333 | 88,097 | 83,248 | ||||||||||||
10
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended December 31,
(dollars in thousands, fully taxable equivalent (FTE))
| 2021 | 2020 | |||||||||||||||||||||||
| Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | |||||||||||||||||||
| Assets: | ||||||||||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||||||
| Loans, net of unearned income (FTE) (1)(2) | $ | 11,689,412 | $ | 123,250 | 4.18 | % | $ | 11,595,484 | $ | 140,687 | 4.83 | % | ||||||||||||
| Taxable securities (3) | 5,156,563 | 17,149 | 1.33 | 3,039,275 | 12,452 | 1.64 | ||||||||||||||||||
| Tax-exempt securities (FTE) (1)(3) | 387,638 | 3,080 | 3.18 | 286,490 | 2,759 | 3.85 | ||||||||||||||||||
| Federal funds sold and other interest-earning assets | 2,308,241 | 1,322 | 0.23 | 1,472,668 | 1,132 | 0.31 | ||||||||||||||||||
| Total interest-earning assets (FTE) | 19,541,854 | 144,801 | 2.94 | 16,393,917 | 157,030 | 3.81 | ||||||||||||||||||
| Noninterest-earning assets: | ||||||||||||||||||||||||
| Allowance for loan losses | (103,167 | ) | (138,313 | ) | ||||||||||||||||||||
| Cash and due from banks | 141,967 | 143,694 | ||||||||||||||||||||||
| Premises and equipment | 245,869 | 218,349 | ||||||||||||||||||||||
| Other assets (3) | 1,036,760 | 1,080,180 | ||||||||||||||||||||||
| Total assets | $ | 20,863,283 | $ | 17,697,827 | ||||||||||||||||||||
| Liabilities and Shareholders’ Equity: | ||||||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||||||||||
| NOW and interest-bearing demand | $ | 4,080,621 | 1,310 | 0.13 | $ | 3,281,984 | 1,495 | 0.18 | ||||||||||||||||
| Money market | 4,323,851 | 1,102 | 0.10 | 3,698,734 | 2,196 | 0.24 | ||||||||||||||||||
| Savings | 1,187,134 | 60 | 0.02 | 918,623 | 48 | 0.02 | ||||||||||||||||||
| Time | 1,461,231 | 567 | 0.15 | 1,748,099 | 2,711 | 0.62 | ||||||||||||||||||
| Brokered time deposits | 65,556 | (175 | ) | (1.06 | ) | 83,750 | (22 | ) | (0.10 | ) | ||||||||||||||
| Total interest-bearing deposits | 11,118,393 | 2,864 | 0.10 | 9,731,190 | 6,428 | 0.26 | ||||||||||||||||||
| Federal funds purchased and other borrowings | 51 | — | — | 54 | — | — | ||||||||||||||||||
| Federal Home Loan Bank advances | 1,426 | 1 | 0.28 | — | — | — | ||||||||||||||||||
| Long-term debt | 247,251 | 3,348 | 5.37 | 327,236 | 4,248 | 5.16 | ||||||||||||||||||
| Total borrowed funds | 248,728 | 3,349 | 5.34 | 327,290 | 4,248 | 5.16 | ||||||||||||||||||
| Total interest-bearing liabilities | 11,367,121 | 6,213 | 0.22 | 10,058,480 | 10,676 | 0.42 | ||||||||||||||||||
| Noninterest-bearing liabilities: | ||||||||||||||||||||||||
| Noninterest-bearing deposits | 6,918,279 | 5,325,858 | ||||||||||||||||||||||
| Other liabilities | 354,665 | 319,158 | ||||||||||||||||||||||
| Total liabilities | 18,640,065 | 15,703,496 | ||||||||||||||||||||||
| Shareholders’ equity | 2,223,218 | 1,994,331 | ||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 20,863,283 | $ | 17,697,827 | ||||||||||||||||||||
| Net interest revenue (FTE) | $ | 138,588 | $ | 146,354 | ||||||||||||||||||||
| Net interest-rate spread (FTE) | 2.72 | % | 3.39 | % | ||||||||||||||||||||
| Net interest margin (FTE) (4) | 2.81 | % | 3.55 | % | ||||||||||||||||||||
| (1) | Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate. |
| (2) | Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale. |
| (3) | Securities available for sale are shown at amortized cost. Pretax unrealized losses of $1.64 million in 2021 and pretax unrealized gains of $72.6 million in 2020 are included in other assets for purposes of this presentation. |
| (4) | Net interest margin is taxable equivalent net interest revenue divided by average interest-earning assets. |
11
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Twelve Months Ended December 31,
(dollars in thousands, fully taxable equivalent (FTE))
| 2021 | 2020 | |||||||||||||||||||||||
| Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | |||||||||||||||||||
| Assets: | ||||||||||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||||||
| Loans, net of unearned income (FTE) (1)(2) | $ | 11,485,876 | $ | 504,015 | 4.39 | % | $ | 10,466,653 | $ | 492,223 | 4.70 | % | ||||||||||||
| Taxable securities (3) | 4,446,712 | 61,994 | 1.39 | 2,532,750 | 55,031 | 2.17 | ||||||||||||||||||
| Tax-exempt securities (FTE) (1)(3) | 382,915 | 12,059 | 3.15 | 219,668 | 9,458 | 4.31 | ||||||||||||||||||
| Federal funds sold and other interest-earning assets | 1,680,151 | 4,784 | 0.28 | 1,007,059 | 4,753 | 0.47 | ||||||||||||||||||
| Total interest-earning assets (FTE) | 17,995,654 | 582,852 | 3.24 | 14,226,130 | 561,465 | 3.95 | ||||||||||||||||||
| Non-interest-earning assets: | ||||||||||||||||||||||||
| Allowance for loan losses | (121,586 | ) | (106,812 | ) | ||||||||||||||||||||
| Cash and due from banks | 139,728 | 136,702 | ||||||||||||||||||||||
| Premises and equipment | 230,276 | 217,751 | ||||||||||||||||||||||
| Other assets (3) | 1,013,956 | 993,584 | ||||||||||||||||||||||
| Total assets | $ | 19,258,028 | $ | 15,467,355 | ||||||||||||||||||||
| Liabilities and Shareholders’ Equity: | ||||||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||||||||||
| NOW and interest-bearing demand | $ | 3,610,601 | 5,468 | 0.15 | $ | 2,759,383 | 7,735 | 0.28 | ||||||||||||||||
| Money market | 3,972,358 | 5,380 | 0.14 | 3,023,928 | 13,165 | 0.44 | ||||||||||||||||||
| Savings | 1,095,071 | 217 | 0.02 | 821,344 | 169 | 0.02 | ||||||||||||||||||
| Time | 1,529,072 | 3,663 | 0.24 | 1,832,319 | 20,146 | 1.10 | ||||||||||||||||||
| Brokered time deposits | 67,230 | 117 | 0.17 | 97,788 | 557 | 0.57 | ||||||||||||||||||
| Total interest-bearing deposits | 10,274,332 | 14,845 | 0.14 | 8,534,762 | 41,772 | 0.49 | ||||||||||||||||||
| Federal funds purchased and other borrowings | 44 | — | — | 1,220 | 3 | 0.25 | ||||||||||||||||||
| Federal Home Loan Bank advances | 1,195 | 3 | 0.25 | 749 | 28 | 3.74 | ||||||||||||||||||
| Long-term debt | 276,492 | 14,912 | 5.39 | 274,069 | 14,434 | 5.27 | ||||||||||||||||||
| Total borrowed funds | 277,731 | 14,915 | 5.37 | 276,038 | 14,465 | 5.24 | ||||||||||||||||||
| Total interest-bearing liabilities | 10,552,063 | 29,760 | 0.28 | 8,810,800 | 56,237 | 0.64 | ||||||||||||||||||
| Noninterest-bearing liabilities: | ||||||||||||||||||||||||
| Noninterest-bearing deposits | 6,276,094 | 4,600,152 | ||||||||||||||||||||||
| Other liabilities | 322,566 | 235,120 | ||||||||||||||||||||||
| Total liabilities | 17,150,723 | 13,646,072 | ||||||||||||||||||||||
| Shareholders’ equity | 2,107,305 | 1,821,283 | ||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 19,258,028 | $ | 15,467,355 | ||||||||||||||||||||
| Net interest revenue (FTE) | $ | 553,092 | $ | 505,228 | ||||||||||||||||||||
| Net interest-rate spread (FTE) | 2.96 | % | 3.31 | % | ||||||||||||||||||||
| Net interest margin (FTE) (4) | 3.07 | % | 3.55 | % | ||||||||||||||||||||
| (1) | Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate. |
| (2) | Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale. |
| (3) | Securities available for sale are shown at amortized cost. Pretax unrealized gains of $28.7 million in 2021 and $67.3 million in 2020 are included in other assets for purposes of this presentation. |
| (4) | Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets. |
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About United Community Banks, Inc.
United Community Banks, Inc. (NASDAQGS: UCBI) provides a full range of banking, wealth management and mortgage services for relationship-oriented consumers and business owners. The company, known as “The Bank That SERVICE Built,” has been recognized nationally for delivering award-winning service. At December 31, 2021, United had $20.9 billion in assets and 171 offices in Florida, Georgia, North Carolina, South Carolina and Tennessee along with a national SBA lending franchise and a national equipment lending subsidiary. Through its January 1, 2022 acquisition of Reliant Bancorp and its wholly-owned banking subsidiary, Reliant Bank, United added $3 billion in assets and 25 banking offices in high growth markets in Tennessee. In 2021, J.D. Power ranked United highest in customer satisfaction with retail banking in the Southeast, marking seven out of the last eight years United earned the coveted award. United was also named one of the "Best Banks to Work For" by American Banker in 2021 for the fifth consecutive year based on employee satisfaction. Forbes included United in its inaugural list of the World’s Best Banks in 2019 and again in 2020. Forbes also recognized United on its 2021 list of the 100 Best Banks in America for the eighth consecutive year. United also received five Greenwich Excellence Awards in 2020 for excellence in Small Business Banking, including a national award for Overall Satisfaction. Additional information about United can be found at www.ucbi.com.
Non-GAAP Financial Measures
This press release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP. This financial information includes certain operating performance measures, which exclude merger-related and other charges that are not considered part of recurring operations, such as “operating net income,” “pre-tax, pre-provision income,” “operating net income per diluted common share,” “operating earnings per share,” “tangible book value per common share,” “operating return on common equity,” “operating return on tangible common equity,” “operating return on assets,” “return on assets - pre-tax, pre-provision, excluding merger-related and other charges,” “return on assets - pre-tax, pre-provision,” “operating efficiency ratio,” and “tangible common equity to tangible assets.” These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United’s underlying performance trends. These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.
Caution About Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In general, forward-looking statements usually may be identified through use of words such as “may,” “believe,” “expect,” “anticipate,” “intend,” “will,” “should,” “plan,” “estimate,” “predict,” “continue” and “potential” or the negative of these terms or other comparable terminology, and include statements related to the accretive value of each of the Aquesta and Reliant acquisitions to United’s earnings. Forward-looking statements are not historical facts and represent management’s beliefs, based upon information available at the time the statements are made, with regard to the matters addressed; they are not guarantees of future performance. Actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial condition to differ materially from those expressed in or implied by such statements.
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Factors that could cause or contribute to such differences include, but are not limited to (1) the risk that the cost savings and any revenue synergies from the Aquesta and Reliant acquisitions may not be realized or take longer than anticipated to be realized, (2) disruption of customer, supplier, employee or other business partner relationships as a result of the Aquesta and Reliant acquisitions, (3) the possibility that the costs, fees, expenses and charges related to the acquisition of Reliant may be greater than anticipated, (4) reputational risk and the reaction of the companies’ customers, suppliers, employees or other business partners to the acquisitions of Aquesta and Reliant, (5) the risks relating to the integration of Reliant’s operations into the operations of United, including the risk that such integration will be materially delayed or will be more costly or difficult than expected, (6) the risk of potential litigation or regulatory action related to the acquisitions of Aquesta and Reliant, (7) the risks associated with United’s pursuit of future acquisitions, (8) the risk of expansion into new geographic or product markets, (9) the dilution caused by United’s issuance of additional shares of its common stock in the acquisitions of Aquesta and Reliant, and (10) general competitive, economic, political and market conditions. Further information regarding additional factors which could affect the forward-looking statements contained in this press release can be found in the cautionary language included under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in United’s Annual Report on Form 10-K for the year ended December 31, 2020, and other documents subsequently filed by United with the United States Securities and Exchange Commission (“SEC”).
Many of these factors are beyond United’s ability to control or predict. If one or more events related to these or other risks or uncertainties materialize, or if the underlying assumptions prove to be incorrect, actual results may differ materially from the forward-looking statements. Accordingly, shareholders and investors should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date of this communication, and United undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for United to predict their occurrence or how they will affect United or Reliant.
United qualifies all forward-looking statements by these cautionary statements.
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