Washington | 0-20288 | 91-1422237 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||
1301 A Street Tacoma, WA | 98402 | |||
(Address of principal executive offices) | (Zip Code) |
☒ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
99.1 | Press Release dated January 26, 2017 reporting the financial results of Columbia Banking System, Inc. for the quarter and year ended December 31, 2016. |
99.2 | Press Release dated January 26, 2017 announcing a regular quarterly cash dividend. |
COLUMBIA BANKING SYSTEM, INC. | |||||
Date: | January 26, 2017 | /s/ MELANIE J. DRESSEL | |||
Melanie J. Dressel | |||||
President and Chief Executive Officer |
99.1 | Press Release dated January 26, 2017 reporting the financial results of Columbia Banking System, Inc. for the quarter and year ended December 31, 2016. |
99.2 | Press Release dated January 26, 2017 announcing a regular quarterly cash dividend. |
• | Announced merger agreement with Pacific Continental Corporation |
• | Record fourth quarter net income of $30.7 million; diluted earnings per share of $0.53 |
• | Record full year 2016 net income of $104.9 million; diluted earnings per share of $1.81 |
• | New loan production for the quarter of $294.1 million and record full year loan production of $1.26 billion |
• | Deposits increased $620.6 million or 8% and loans increased $398.4 million or 7% from year end 2015 |
• | Nonperforming assets to period end assets ratio remains near record lows at 0.35% |
• | Warm Hearts Winter Drive raised over $200,000 and 8,000 warm winter items to benefit homeless shelters across the Northwest |
Three Months Ended | Twelve Months Ended | |||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||
2016 | 2016 | 2015 | 2016 | 2015 | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Adjustments reflected in income | ||||||||||||||||||||
Amortization, net | $ | (299 | ) | $ | (315 | ) | $ | (1,098 | ) | (2,829 | ) | (6,184 | ) | |||||||
Loan impairment (recapture) | (92 | ) | 266 | 855 | 301 | 2,268 | ||||||||||||||
Sales of other real estate owned | 77 | (49 | ) | (484 | ) | 148 | (1,237 | ) | ||||||||||||
Valuation adjustments on other real estate owned | — | — | 10 | (22 | ) | 1,158 | ||||||||||||||
Other | (74 | ) | (6 | ) | (314 | ) | (183 | ) | (15 | ) | ||||||||||
Change in FDIC loss-sharing asset | $ | (388 | ) | $ | (104 | ) | $ | (1,031 | ) | $ | (2,585 | ) | $ | (4,010 | ) |
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2016 | 2016 | 2016 | 2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||
Incremental accretion income due to: | ||||||||||||||||||||||||||||
FDIC purchased credit impaired loans | $ | 1,199 | $ | 1,816 | $ | 1,300 | $ | 1,657 | $ | 2,200 | $ | 5,972 | $ | 9,096 | ||||||||||||||
Other FDIC acquired loans (2) | — | — | — | — | 68 | — | 234 | |||||||||||||||||||||
Other acquired loans | 3,087 | 2,749 | 3,074 | 3,073 | 3,746 | 11,983 | 17,862 | |||||||||||||||||||||
Incremental accretion income | $ | 4,286 | $ | 4,565 | $ | 4,374 | $ | 4,730 | $ | 6,014 | $ | 17,955 | $ | 27,192 | ||||||||||||||
Net interest margin (tax equivalent) | 4.11 | % | 4.13 | % | 4.10 | % | 4.13 | % | 4.25 | % | 4.12 | % | 4.35 | % | ||||||||||||||
Operating net interest margin (tax equivalent) (1) | 3.99 | % | 4.03 | % | 4.00 | % | 4.03 | % | 4.09 | % | 4.01 | % | 4.15 | % |
December 31, 2016 | September 30, 2016 | December 31, 2015 | ||||||||||
(in thousands) | ||||||||||||
Nonaccrual loans: | ||||||||||||
Commercial business | $ | 11,555 | $ | 9,502 | $ | 9,437 | ||||||
Real estate: | ||||||||||||
One-to-four family residential | 568 | 579 | 820 | |||||||||
Commercial and multifamily residential | 11,187 | 7,052 | 9,513 | |||||||||
Total real estate | 11,755 | 7,631 | 10,333 | |||||||||
Real estate construction: | ||||||||||||
One-to-four family residential | 563 | 461 | 928 | |||||||||
Total real estate construction | 563 | 461 | 928 | |||||||||
Consumer | 3,883 | 3,772 | 766 | |||||||||
Total nonaccrual loans | 27,756 | 21,366 | 21,464 | |||||||||
Other real estate owned and other personal property owned | 5,998 | 8,994 | 13,738 | |||||||||
Total nonperforming assets | $ | 33,754 | $ | 30,360 | $ | 35,202 |
Three Months Ended | Twelve Months Ended | |||||||||||||||||||
December 31, 2016 | September 30, 2016 | December 31, 2015 | December 31, 2016 | December 31, 2015 | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Beginning balance | $ | 70,264 | $ | 69,304 | $ | 69,049 | $ | 68,172 | $ | 69,569 | ||||||||||
Charge-offs: | ||||||||||||||||||||
Commercial business | (1,195 | ) | (2,159 | ) | (2,184 | ) | (10,068 | ) | (8,266 | ) | ||||||||||
One-to-four family residential real estate | — | — | (79 | ) | (35 | ) | (376 | ) | ||||||||||||
Commercial and multifamily residential real estate | (63 | ) | — | (264 | ) | (89 | ) | (505 | ) | |||||||||||
One-to-four family residential real estate construction | (88 | ) | — | — | (88 | ) | — | |||||||||||||
Consumer | (255 | ) | (383 | ) | (545 | ) | (1,238 | ) | (2,066 | ) | ||||||||||
Purchased credit impaired | (2,118 | ) | (2,062 | ) | (3,680 | ) | (9,944 | ) | (13,854 | ) | ||||||||||
Total charge-offs | (3,719 | ) | (4,604 | ) | (6,752 | ) | (21,462 | ) | (25,067 | ) | ||||||||||
Recoveries: | ||||||||||||||||||||
Commercial business | 377 | 854 | 886 | 2,646 | 2,336 | |||||||||||||||
One-to-four family residential real estate | 29 | 81 | 19 | 171 | 307 | |||||||||||||||
Commercial and multifamily residential real estate | 1,182 | 20 | 277 | 1,401 | 3,975 | |||||||||||||||
One-to-four family residential real estate construction | 11 | 21 | 52 | 291 | 193 | |||||||||||||||
Commercial and multifamily residential real estate construction | — | 107 | 1 | 109 | 8 | |||||||||||||||
Consumer | 168 | 399 | 224 | 933 | 931 | |||||||||||||||
Purchased credit impaired | 1,713 | 2,216 | 2,067 | 7,004 | 7,329 | |||||||||||||||
Total recoveries | 3,480 | 3,698 | 3,526 | 12,555 | 15,079 | |||||||||||||||
Net charge-offs | (239 | ) | (906 | ) | (3,226 | ) | (8,907 | ) | (9,988 | ) | ||||||||||
Provision for loan and lease losses | 18 | 1,866 | 2,349 | 10,778 | 8,591 | |||||||||||||||
Ending balance | $ | 70,043 | $ | 70,264 | $ | 68,172 | $ | 70,043 | $ | 68,172 |
FDIC Acquired Loan Accounting | ||||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||
December 31, 2016 | September 30, 2016 | December 31, 2015 | December 31, 2016 | December 31, 2015 | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Incremental accretion income on FDIC purchased credit impaired loans | $ | 1,199 | $ | 1,816 | $ | 2,200 | $ | 5,972 | $ | 9,096 | ||||||||||
Incremental accretion income on other FDIC acquired loans (1) | — | — | 68 | — | 234 | |||||||||||||||
Recapture (provision) for losses on FDIC purchased credit impaired loans | 582 | 433 | (1,349 | ) | 271 | (3,915 | ) | |||||||||||||
Change in FDIC loss-sharing asset | (388 | ) | (104 | ) | (1,031 | ) | (2,585 | ) | (4,010 | ) | ||||||||||
FDIC clawback liability recovery (expense) | 28 | (29 | ) | (812 | ) | (280 | ) | (979 | ) | |||||||||||
Pre-tax earnings impact | $ | 1,421 | $ | 2,116 | $ | (924 | ) | $ | 3,378 | $ | 426 |
Contacts: | Melanie J. Dressel, | |
President and | ||
Chief Executive Officer | ||
Clint E. Stein | ||
Executive Vice President | ||
and Chief Financial Officer | ||
Investor Relations | ||
(253) 305-1965 |
FINANCIAL STATISTICS | ||||||||||||||||||||
Columbia Banking System, Inc. | Three Months Ended | Twelve Months Ended | ||||||||||||||||||
Unaudited | December 31, | September 30, | December 31, | December 31, | December 31, | |||||||||||||||
2016 | 2016 | 2015 | 2016 | 2015 | ||||||||||||||||
Earnings | (dollars in thousands except per share amounts) | |||||||||||||||||||
Net interest income | $ | 85,737 | $ | 85,572 | $ | 81,819 | $ | 333,619 | $ | 324,887 | ||||||||||
Provision for loan and lease losses | $ | 18 | $ | 1,866 | $ | 2,349 | $ | 10,778 | $ | 8,591 | ||||||||||
Noninterest income | $ | 22,330 | $ | 23,166 | $ | 24,745 | $ | 88,082 | $ | 91,473 | ||||||||||
Noninterest expense | $ | 65,014 | $ | 67,264 | $ | 66,877 | $ | 261,142 | $ | 266,149 | ||||||||||
Acquisition-related expense (included in noninterest expense) | $ | 291 | $ | — | $ | 1,872 | $ | 2,727 | $ | 10,917 | ||||||||||
Net income | $ | 30,718 | $ | 27,484 | $ | 26,740 | $ | 104,866 | $ | 98,827 | ||||||||||
Per Common Share | ||||||||||||||||||||
Earnings (basic) | $ | 0.53 | $ | 0.47 | $ | 0.46 | $ | 1.81 | $ | 1.71 | ||||||||||
Earnings (diluted) | $ | 0.53 | $ | 0.47 | $ | 0.46 | $ | 1.81 | $ | 1.71 | ||||||||||
Book value | $ | 21.52 | $ | 21.96 | $ | 21.48 | $ | 21.52 | $ | 21.48 | ||||||||||
Averages | ||||||||||||||||||||
Total assets | $ | 9,568,214 | $ | 9,493,451 | $ | 8,905,743 | $ | 9,311,621 | $ | 8,655,243 | ||||||||||
Interest-earning assets | $ | 8,612,498 | $ | 8,544,876 | $ | 7,937,308 | $ | 8,363,309 | $ | 7,685,734 | ||||||||||
Loans | $ | 6,200,506 | $ | 6,179,163 | $ | 5,762,048 | $ | 6,052,389 | $ | 5,609,261 | ||||||||||
Securities, including Federal Home Loan Bank stock | $ | 2,314,521 | $ | 2,351,093 | $ | 2,136,703 | $ | 2,269,121 | $ | 2,031,859 | ||||||||||
Deposits | $ | 8,105,522 | $ | 7,918,532 | $ | 7,440,628 | $ | 7,774,309 | $ | 7,146,828 | ||||||||||
Interest-bearing deposits | $ | 4,151,695 | $ | 4,118,787 | $ | 3,933,001 | $ | 4,070,401 | $ | 3,937,881 | ||||||||||
Interest-bearing liabilities | $ | 4,222,820 | $ | 4,295,485 | $ | 4,031,214 | $ | 4,227,096 | $ | 4,097,483 | ||||||||||
Noninterest-bearing deposits | $ | 3,953,827 | $ | 3,799,745 | $ | 3,507,627 | $ | 3,703,908 | $ | 3,208,947 | ||||||||||
Shareholders' equity | $ | 1,274,388 | $ | 1,278,588 | $ | 1,259,117 | $ | 1,269,801 | $ | 1,246,952 | ||||||||||
Financial Ratios | ||||||||||||||||||||
Return on average assets | 1.29 | % | 1.16 | % | 1.20 | % | 1.13 | % | 1.14 | % | ||||||||||
Return on average common equity | 9.68 | % | 8.60 | % | 8.50 | % | 8.27 | % | 7.93 | % | ||||||||||
Average equity to average assets | 13.32 | % | 13.47 | % | 14.14 | % | 13.64 | % | 14.41 | % | ||||||||||
Net interest margin (tax equivalent) | 4.11 | % | 4.13 | % | 4.25 | % | 4.12 | % | 4.35 | % | ||||||||||
Efficiency ratio (tax equivalent) (1) | 58.35 | % | 60.02 | % | 60.99 | % | 60.04 | % | 62.12 | % | ||||||||||
Operating efficiency ratio (tax equivalent) (2) | 58.10 | % | 60.47 | % | 60.53 | % | 59.21 | % | 60.78 | % | ||||||||||
December 31, | September 30, | December 31, | ||||||||||||||||||
Period end | 2016 | 2016 | 2015 | |||||||||||||||||
Total assets | $ | 9,509,607 | $ | 9,586,754 | 8,951,697 | |||||||||||||||
Loans, net of unearned income | $ | 6,213,423 | $ | 6,259,757 | 5,815,027 | |||||||||||||||
Allowance for loan and lease losses | $ | 70,043 | $ | 70,264 | 68,172 | |||||||||||||||
Securities, including Federal Home Loan Bank stock | $ | 2,288,817 | $ | 2,372,724 | 2,170,416 | |||||||||||||||
Deposits | $ | 8,059,415 | $ | 8,057,816 | 7,438,829 | |||||||||||||||
Core deposits | $ | 7,749,568 | $ | 7,809,064 | 7,238,713 | |||||||||||||||
Shareholders' equity | $ | 1,251,012 | $ | 1,276,735 | 1,242,128 | |||||||||||||||
Nonperforming assets | ||||||||||||||||||||
Nonaccrual loans | $ | 27,756 | $ | 21,366 | 21,464 | |||||||||||||||
Other real estate owned ("OREO") and other personal property owned ("OPPO") | 5,998 | 8,994 | 13,738 | |||||||||||||||||
Total nonperforming assets | $ | 33,754 | $ | 30,360 | $ | 35,202 | ||||||||||||||
Nonperforming loans to period-end loans | 0.45 | % | 0.34 | % | 0.37 | % | ||||||||||||||
Nonperforming assets to period-end assets | 0.35 | % | 0.32 | % | 0.39 | % | ||||||||||||||
Allowance for loan and lease losses to period-end loans | 1.13 | % | 1.12 | % | 1.17 | % | ||||||||||||||
Net loan charge-offs | $ | 239 | (3) | $ | 906 | (4) | $ | 3,226 | (5) | |||||||||||
(1) Noninterest expense divided by the sum of net interest income on a tax equivalent basis and noninterest income on a tax equivalent basis. | ||||||||||||||||||||
(2) The operating efficiency ratio (tax equivalent) is a non-GAAP financial measure. See section titled "Non-GAAP Financial Measures" on the last page of this earnings release for the reconciliation of the operating efficiency ratio (tax equivalent) to the efficiency ratio (tax equivalent). | ||||||||||||||||||||
(3) For the three months ended December 31, 2016. | ||||||||||||||||||||
(4) For the three months ended September 30, 2016. | ||||||||||||||||||||
(5) For the three months ended December 31, 2015. |
QUARTERLY FINANCIAL STATISTICS | ||||||||||||||||||||
Columbia Banking System, Inc. | Three Months Ended | |||||||||||||||||||
Unaudited | December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||||||
2016 | 2016 | 2016 | 2016 | 2015 | ||||||||||||||||
(dollars in thousands except per share) | ||||||||||||||||||||
Earnings | ||||||||||||||||||||
Net interest income | $ | 85,737 | $ | 85,572 | $ | 82,140 | $ | 80,170 | $ | 81,819 | ||||||||||
Provision for loan and lease losses | $ | 18 | $ | 1,866 | $ | 3,640 | $ | 5,254 | $ | 2,349 | ||||||||||
Noninterest income | $ | 22,330 | $ | 23,166 | $ | 21,940 | $ | 20,646 | $ | 24,745 | ||||||||||
Noninterest expense | $ | 65,014 | $ | 67,264 | $ | 63,790 | $ | 65,074 | $ | 66,877 | ||||||||||
Acquisition-related expense (included in noninterest expense) | $ | 291 | $ | — | $ | — | $ | 2,436 | $ | 1,872 | ||||||||||
Net income | $ | 30,718 | $ | 27,484 | $ | 25,405 | $ | 21,259 | $ | 26,740 | ||||||||||
Per Common Share | ||||||||||||||||||||
Earnings (basic) | $ | 0.53 | $ | 0.47 | $ | 0.44 | $ | 0.37 | $ | 0.46 | ||||||||||
Earnings (diluted) | $ | 0.53 | $ | 0.47 | $ | 0.44 | $ | 0.37 | $ | 0.46 | ||||||||||
Book value | $ | 21.52 | $ | 21.96 | $ | 21.93 | $ | 21.70 | $ | 21.48 | ||||||||||
Averages | ||||||||||||||||||||
Total assets | $ | 9,568,214 | $ | 9,493,451 | $ | 9,230,791 | $ | 8,949,212 | $ | 8,905,743 | ||||||||||
Interest-earning assets | $ | 8,612,498 | $ | 8,544,876 | $ | 8,285,183 | $ | 8,005,945 | $ | 7,937,308 | ||||||||||
Loans | $ | 6,200,506 | $ | 6,179,163 | $ | 5,999,428 | $ | 5,827,440 | $ | 5,762,048 | ||||||||||
Securities, including Federal Home Loan Bank stock | $ | 2,314,521 | $ | 2,351,093 | $ | 2,262,012 | $ | 2,147,457 | $ | 2,136,703 | ||||||||||
Deposits | $ | 8,105,522 | $ | 7,918,532 | $ | 7,622,266 | $ | 7,445,693 | $ | 7,440,628 | ||||||||||
Interest-bearing deposits | $ | 4,151,695 | $ | 4,118,787 | $ | 4,026,384 | $ | 3,983,314 | $ | 3,933,001 | ||||||||||
Interest-bearing liabilities | $ | 4,222,820 | $ | 4,295,485 | $ | 4,264,792 | $ | 4,124,582 | $ | 4,031,214 | ||||||||||
Noninterest-bearing deposits | $ | 3,953,827 | $ | 3,799,745 | $ | 3,595,882 | $ | 3,462,379 | $ | 3,507,627 | ||||||||||
Shareholders' equity | $ | 1,274,388 | $ | 1,278,588 | $ | 1,267,670 | $ | 1,258,411 | $ | 1,259,117 | ||||||||||
Financial Ratios | ||||||||||||||||||||
Return on average assets | 1.29 | % | 1.16 | % | 1.10 | % | 0.95 | % | 1.20 | % | ||||||||||
Return on average common equity | 9.68 | % | 8.60 | % | 8.02 | % | 6.76 | % | 8.50 | % | ||||||||||
Average equity to average assets | 13.32 | % | 13.47 | % | 13.73 | % | 14.06 | % | 14.14 | % | ||||||||||
Net interest margin (tax equivalent) | 4.11 | % | 4.13 | % | 4.10 | % | 4.13 | % | 4.25 | % | ||||||||||
Period end | ||||||||||||||||||||
Total assets | $ | 9,509,607 | $ | 9,586,754 | $ | 9,353,651 | $ | 9,035,932 | $ | 8,951,697 | ||||||||||
Loans, net of unearned income | $ | 6,213,423 | $ | 6,259,757 | $ | 6,107,143 | $ | 5,877,283 | $ | 5,815,027 | ||||||||||
Allowance for loan and lease losses | $ | 70,043 | $ | 70,264 | $ | 69,304 | $ | 69,264 | $ | 68,172 | ||||||||||
Securities, including Federal Home Loan Bank stock | $ | 2,288,817 | $ | 2,372,724 | $ | 2,297,713 | $ | 2,196,407 | $ | 2,170,416 | ||||||||||
Deposits | $ | 8,059,415 | $ | 8,057,816 | $ | 7,673,213 | $ | 7,596,949 | $ | 7,438,829 | ||||||||||
Core deposits | $ | 7,749,568 | $ | 7,809,064 | $ | 7,447,963 | $ | 7,384,622 | $ | 7,238,713 | ||||||||||
Shareholders' equity | $ | 1,251,012 | $ | 1,276,735 | $ | 1,274,479 | $ | 1,260,788 | $ | 1,242,128 | ||||||||||
Nonperforming, assets | ||||||||||||||||||||
Nonaccrual loans | $ | 27,756 | $ | 21,366 | $ | 22,915 | $ | 36,891 | $ | 21,464 | ||||||||||
OREO and OPPO | 5,998 | 8,994 | 10,613 | 12,427 | 13,738 | |||||||||||||||
Total nonperforming assets | $ | 33,754 | $ | 30,360 | $ | 33,528 | $ | 49,318 | $ | 35,202 | ||||||||||
Nonperforming loans to period-end loans | 0.45 | % | 0.34 | % | 0.38 | % | 0.63 | % | 0.37 | % | ||||||||||
Nonperforming assets to period-end assets | 0.35 | % | 0.32 | % | 0.36 | % | 0.55 | % | 0.39 | % | ||||||||||
Allowance for loan and lease losses to period-end loans | 1.13 | % | 1.12 | % | 1.13 | % | 1.18 | % | 1.17 | % | ||||||||||
Net loan charge-offs | $ | 239 | $ | 906 | $ | 3,600 | $ | 4,162 | $ | 3,226 |
LOAN PORTFOLIO COMPOSITION | ||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||
Unaudited | December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||||||
2016 | 2016 | 2016 | 2016 | 2015 | ||||||||||||||||
Loan Portfolio Composition - Dollars | (dollars in thousands) | |||||||||||||||||||
Commercial business | $ | 2,551,054 | $ | 2,630,017 | $ | 2,518,682 | $ | 2,401,193 | $ | 2,362,575 | ||||||||||
Real estate: | ||||||||||||||||||||
One-to-four family residential | 170,331 | 168,511 | 172,957 | 175,050 | 176,295 | |||||||||||||||
Commercial and multifamily residential | 2,719,830 | 2,686,783 | 2,651,476 | 2,520,352 | 2,491,736 | |||||||||||||||
Total real estate | 2,890,161 | 2,855,294 | 2,824,433 | 2,695,402 | 2,668,031 | |||||||||||||||
Real estate construction: | ||||||||||||||||||||
One-to-four family residential | 121,887 | 130,163 | 129,195 | 133,447 | 135,874 | |||||||||||||||
Commercial and multifamily residential | 209,118 | 202,014 | 185,315 | 183,548 | 167,413 | |||||||||||||||
Total real estate construction | 331,005 | 332,177 | 314,510 | 316,995 | 303,287 | |||||||||||||||
Consumer | 329,261 | 325,741 | 325,632 | 329,902 | 342,601 | |||||||||||||||
Purchased credit impaired | 145,660 | 152,764 | 161,107 | 173,201 | 180,906 | |||||||||||||||
Subtotal loans | 6,247,141 | 6,295,993 | 6,144,364 | 5,916,693 | 5,857,400 | |||||||||||||||
Less: Net unearned income | (33,718 | ) | (36,236 | ) | (37,221 | ) | (39,410 | ) | (42,373 | ) | ||||||||||
Loans, net of unearned income | 6,213,423 | 6,259,757 | 6,107,143 | 5,877,283 | 5,815,027 | |||||||||||||||
Less: Allowance for loan and lease losses | (70,043 | ) | (70,264 | ) | (69,304 | ) | (69,264 | ) | (68,172 | ) | ||||||||||
Total loans, net | 6,143,380 | 6,189,493 | 6,037,839 | 5,808,019 | 5,746,855 | |||||||||||||||
Loans held for sale | $ | 5,846 | $ | 3,361 | $ | 7,649 | $ | 3,681 | $ | 4,509 |
December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||
Loan Portfolio Composition - Percentages | 2016 | 2016 | 2016 | 2016 | 2015 | ||||||||||
Commercial business | 41.1 | % | 42.0 | % | 41.2 | % | 40.9 | % | 40.6 | % | |||||
Real estate: | |||||||||||||||
One-to-four family residential | 2.7 | % | 2.7 | % | 2.8 | % | 3.0 | % | 3.0 | % | |||||
Commercial and multifamily residential | 43.7 | % | 43.0 | % | 43.6 | % | 42.9 | % | 42.9 | % | |||||
Total real estate | 46.4 | % | 45.7 | % | 46.4 | % | 45.9 | % | 45.9 | % | |||||
Real estate construction: | |||||||||||||||
One-to-four family residential | 2.0 | % | 2.1 | % | 2.1 | % | 2.3 | % | 2.3 | % | |||||
Commercial and multifamily residential | 3.4 | % | 3.2 | % | 3.0 | % | 3.1 | % | 2.9 | % | |||||
Total real estate construction | 5.4 | % | 5.3 | % | 5.1 | % | 5.4 | % | 5.2 | % | |||||
Consumer | 5.3 | % | 5.2 | % | 5.3 | % | 5.6 | % | 5.9 | % | |||||
Purchased credit impaired | 2.3 | % | 2.4 | % | 2.6 | % | 2.9 | % | 3.1 | % | |||||
Subtotal loans | 100.5 | % | 100.6 | % | 100.6 | % | 100.7 | % | 100.7 | % | |||||
Less: Net unearned income | (0.5 | )% | (0.6 | )% | (0.6 | )% | (0.7 | )% | (0.7 | )% | |||||
Loans, net of unearned income | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
DEPOSIT COMPOSITION | ||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||
Unaudited | ||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
2016 | 2016 | 2016 | 2016 | 2015 | ||||||||||||||||
Deposit Composition - Dollars | (dollars in thousands) | |||||||||||||||||||
Core deposits: | ||||||||||||||||||||
Demand and other non-interest bearing | $ | 3,944,495 | $ | 3,942,434 | $ | 3,652,951 | $ | 3,553,468 | $ | 3,507,358 | ||||||||||
Interest bearing demand | 985,293 | 963,242 | 957,548 | 958,469 | 925,909 | |||||||||||||||
Money market | 1,791,283 | 1,873,376 | 1,818,337 | 1,838,364 | 1,788,552 | |||||||||||||||
Savings | 723,667 | 714,047 | 692,694 | 695,588 | 657,016 | |||||||||||||||
Certificates of deposit, less than $250,000 | 304,830 | 315,965 | 326,433 | 338,733 | 359,878 | |||||||||||||||
Total core deposits | 7,749,568 | 7,809,064 | 7,447,963 | 7,384,622 | 7,238,713 | |||||||||||||||
Certificates of deposit, $250,000 or more | 79,424 | 79,590 | 72,812 | 70,571 | 72,126 | |||||||||||||||
Certificates of deposit insured by CDARS® | 22,039 | 16,951 | 22,755 | 24,752 | 26,901 | |||||||||||||||
Brokered money market accounts | 208,348 | 152,151 | 129,590 | 116,878 | 100,854 | |||||||||||||||
Subtotal | 8,059,379 | 8,057,756 | 7,673,120 | 7,596,823 | 7,438,594 | |||||||||||||||
Premium resulting from acquisition date fair value adjustment | 36 | 60 | 93 | 126 | 235 | |||||||||||||||
Total deposits | $ | 8,059,415 | $ | 8,057,816 | $ | 7,673,213 | $ | 7,596,949 | $ | 7,438,829 |
December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||
Deposit Composition - Percentages | 2016 | 2016 | 2016 | 2016 | 2015 | ||||||||||
Core deposits: | |||||||||||||||
Demand and other non-interest bearing | 48.9 | % | 48.9 | % | 47.6 | % | 46.8 | % | 47.2 | % | |||||
Interest bearing demand | 12.2 | % | 12.0 | % | 12.5 | % | 12.6 | % | 12.4 | % | |||||
Money market | 22.2 | % | 23.2 | % | 23.7 | % | 24.2 | % | 24.0 | % | |||||
Savings | 9.0 | % | 8.9 | % | 9.0 | % | 9.2 | % | 8.8 | % | |||||
Certificates of deposit, less than $250,000 | 3.8 | % | 3.9 | % | 4.3 | % | 4.5 | % | 4.8 | % | |||||
Total core deposits | 96.1 | % | 96.9 | % | 97.1 | % | 97.3 | % | 97.2 | % | |||||
Certificates of deposit, $250,000 or more | 1.0 | % | 1.0 | % | 0.9 | % | 0.9 | % | 1.0 | % | |||||
Certificates of deposit insured by CDARS® | 0.3 | % | 0.2 | % | 0.3 | % | 0.3 | % | 0.4 | % | |||||
Brokered money market accounts | 2.6 | % | 1.9 | % | 1.7 | % | 1.5 | % | 1.4 | % | |||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||||
Columbia Banking System, Inc. | Three Months Ended | Twelve Months Ended | ||||||||||||||||||
Unaudited | December 31, | September 30, | December 31, | December 31, | December 31, | |||||||||||||||
2016 | 2016 | 2015 (1) | 2016 | 2015 (1) | ||||||||||||||||
(in thousands except per share) | ||||||||||||||||||||
Interest Income | ||||||||||||||||||||
Loans | $ | 74,542 | $ | 74,956 | $ | 71,358 | $ | 291,465 | $ | 286,166 | ||||||||||
Taxable securities | 9,333 | 8,988 | 8,516 | 35,167 | 30,774 | |||||||||||||||
Tax-exempt securities | 2,724 | 2,799 | 2,870 | 11,121 | 11,842 | |||||||||||||||
Deposits in banks | 135 | 15 | 25 | 216 | 109 | |||||||||||||||
Total interest income | 86,734 | 86,758 | 82,769 | 337,969 | 328,891 | |||||||||||||||
Interest Expense | ||||||||||||||||||||
Deposits | 782 | 823 | 733 | 3,134 | 2,977 | |||||||||||||||
Federal Home Loan Bank advances | 77 | 229 | 83 | 671 | 474 | |||||||||||||||
Other borrowings | 138 | 134 | 134 | 545 | 553 | |||||||||||||||
Total interest expense | 997 | 1,186 | 950 | 4,350 | 4,004 | |||||||||||||||
Net Interest Income | 85,737 | 85,572 | 81,819 | 333,619 | 324,887 | |||||||||||||||
Provision for loan and lease losses | 18 | 1,866 | 2,349 | 10,778 | 8,591 | |||||||||||||||
Net interest income after provision for loan and lease losses | 85,719 | 83,706 | 79,470 | 322,841 | 316,296 | |||||||||||||||
Noninterest Income | ||||||||||||||||||||
Deposit account and treasury management fees (1) | 7,196 | 7,222 | 7,010 | 28,500 | 28,451 | |||||||||||||||
Card revenue (1) | 5,803 | 6,114 | 5,776 | 23,620 | 22,690 | |||||||||||||||
Financial services and trust revenue (1) | 2,919 | 2,746 | 2,939 | 11,266 | 12,596 | |||||||||||||||
Loan revenue (1) | 2,954 | 2,949 | 2,807 | 10,967 | 10,932 | |||||||||||||||
Merchant processing revenue | 2,006 | 2,352 | 2,173 | 8,732 | 8,975 | |||||||||||||||
Bank owned life insurance | 1,087 | 1,073 | 1,071 | 4,546 | 4,441 | |||||||||||||||
Investment securities gains, net | 7 | 572 | 281 | 1,181 | 1,581 | |||||||||||||||
Change in FDIC loss-sharing asset | (388 | ) | (104 | ) | (1,031 | ) | (2,585 | ) | (4,010 | ) | ||||||||||
Other (1) | 746 | 242 | 3,719 | 1,855 | 5,817 | |||||||||||||||
Total noninterest income | 22,330 | 23,166 | 24,745 | 88,082 | 91,473 | |||||||||||||||
Noninterest Expense | ||||||||||||||||||||
Compensation and employee benefits | 38,196 | 38,476 | 36,689 | 150,282 | 149,410 | |||||||||||||||
Occupancy | 7,690 | 8,219 | 10,037 | 33,734 | 34,818 | |||||||||||||||
Merchant processing expense | 1,018 | 1,161 | 1,058 | 4,330 | 4,204 | |||||||||||||||
Advertising and promotion | 720 | 1,993 | 1,233 | 4,598 | 4,713 | |||||||||||||||
Data processing | 4,138 | 4,275 | 4,399 | 16,488 | 17,421 | |||||||||||||||
Legal and professional fees | 2,523 | 2,264 | 2,081 | 7,889 | 9,608 | |||||||||||||||
Taxes, licenses and fees | 1,106 | 1,491 | 1,392 | 5,185 | 5,395 | |||||||||||||||
Regulatory premiums | 792 | 776 | 1,180 | 3,777 | 4,806 | |||||||||||||||
Net cost (benefit) of operation of other real estate owned | 612 | (249 | ) | (60 | ) | 551 | (1,629 | ) | ||||||||||||
Amortization of intangibles | 1,420 | 1,460 | 1,652 | 5,946 | 6,882 | |||||||||||||||
Other | 6,799 | 7,398 | 7,216 | 28,362 | 30,521 | |||||||||||||||
Total noninterest expense | 65,014 | 67,264 | 66,877 | 261,142 | 266,149 | |||||||||||||||
Income before income taxes | 43,035 | 39,608 | 37,338 | 149,781 | 141,620 | |||||||||||||||
Provision for income taxes | 12,317 | 12,124 | 10,598 | 44,915 | 42,793 | |||||||||||||||
Net Income | $ | 30,718 | $ | 27,484 | $ | 26,740 | $ | 104,866 | $ | 98,827 | ||||||||||
Earnings per common share | ||||||||||||||||||||
Basic | $ | 0.53 | $ | 0.47 | $ | 0.46 | $ | 1.81 | $ | 1.71 | ||||||||||
Diluted | $ | 0.53 | $ | 0.47 | $ | 0.46 | $ | 1.81 | $ | 1.71 | ||||||||||
Dividends paid per common share | $ | 0.39 | $ | 0.39 | $ | 0.36 | $ | 1.53 | $ | 1.34 | ||||||||||
Weighted average number of common shares outstanding | 57,220 | 57,215 | 57,057 | 57,184 | 57,019 | |||||||||||||||
Weighted average number of diluted common shares outstanding | 57,229 | 57,225 | 57,070 | 57,193 | 57,032 |
CONSOLIDATED BALANCE SHEETS | ||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||
Unaudited | December 31, | September 30, | December 31, | |||||||||||||||||
2016 | 2016 | 2015 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and due from banks | $ | 193,038 | $ | 180,839 | $ | 166,929 | ||||||||||||||
Interest-earning deposits with banks | 31,200 | 11,225 | 8,373 | |||||||||||||||||
Total cash and cash equivalents | 224,238 | 192,064 | 175,302 | |||||||||||||||||
Securities available for sale at fair value (amortized cost of $2,299,037, $2,324,721 and $2,157,610, respectively) | 2,278,577 | 2,360,084 | 2,157,694 | |||||||||||||||||
Federal Home Loan Bank stock at cost | 10,240 | 12,640 | 12,722 | |||||||||||||||||
Loans held for sale | 5,846 | 3,361 | 4,509 | |||||||||||||||||
Loans, net of unearned income of ($33,718), ($36,236) and ($42,373), respectively | 6,213,423 | 6,259,757 | 5,815,027 | |||||||||||||||||
Less: allowance for loan and lease losses | 70,043 | 70,264 | 68,172 | |||||||||||||||||
Loans, net | 6,143,380 | 6,189,493 | 5,746,855 | |||||||||||||||||
FDIC loss-sharing asset | 3,535 | 3,592 | 6,568 | |||||||||||||||||
Interest receivable | 30,074 | 31,606 | 27,877 | |||||||||||||||||
Premises and equipment, net | 150,342 | 152,908 | 164,239 | |||||||||||||||||
Other real estate owned | 5,998 | 8,994 | 13,738 | |||||||||||||||||
Goodwill | 382,762 | 382,762 | 382,762 | |||||||||||||||||
Other intangible assets, net | 17,631 | 19,051 | 23,577 | |||||||||||||||||
Other assets | 256,984 | 230,199 | 235,854 | |||||||||||||||||
Total assets | $ | 9,509,607 | $ | 9,586,754 | $ | 8,951,697 | ||||||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
Noninterest-bearing | $ | 3,944,495 | $ | 3,942,434 | $ | 3,507,358 | ||||||||||||||
Interest-bearing | 4,114,920 | 4,115,382 | 3,931,471 | |||||||||||||||||
Total deposits | 8,059,415 | 8,057,816 | 7,438,829 | |||||||||||||||||
Federal Home Loan Bank advances | 6,493 | 66,502 | 68,531 | |||||||||||||||||
Securities sold under agreements to repurchase | 80,822 | 69,189 | 99,699 | |||||||||||||||||
Other liabilities | 111,865 | 116,512 | 102,510 | |||||||||||||||||
Total liabilities | 8,258,595 | 8,310,019 | 7,709,569 | |||||||||||||||||
Commitments and contingent liabilities | ||||||||||||||||||||
December 31, | September 30, | December 31, | ||||||||||||||||||
2016 | 2016 | 2015 | ||||||||||||||||||
Preferred stock (no par value) | (in thousands) | |||||||||||||||||||
Authorized shares | 2,000 | 2,000 | 2,000 | |||||||||||||||||
Issued and outstanding | 9 | 9 | 9 | 2,217 | 2,217 | 2,217 | ||||||||||||||
Common stock (no par value) | ||||||||||||||||||||
Authorized shares | 115,000 | 115,000 | 115,000 | |||||||||||||||||
Issued and outstanding | 58,042 | 58,043 | 57,724 | 995,837 | 994,098 | 990,281 | ||||||||||||||
Retained earnings | 271,957 | 263,915 | 255,925 | |||||||||||||||||
Accumulated other comprehensive income (loss) | (18,999 | ) | 16,505 | (6,295 | ) | |||||||||||||||
Total shareholders' equity | 1,251,012 | 1,276,735 | 1,242,128 | |||||||||||||||||
Total liabilities and shareholders' equity | $ | 9,509,607 | $ | 9,586,754 | $ | 8,951,697 |
AVERAGE BALANCES AND RATES | ||||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||
December 31, 2016 | December 31, 2015 | |||||||||||||||||||||
Average Balances | Interest Earned / Paid | Average Rate | Average Balances | Interest Earned / Paid | Average Rate | |||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||
Loans, net (1)(2) | $ | 6,200,506 | $ | 75,838 | 4.89 | % | $ | 5,762,048 | $ | 72,322 | 5.02 | % | ||||||||||
Taxable securities | 1,853,788 | 9,333 | 2.01 | % | 1,686,594 | 8,516 | 2.02 | % | ||||||||||||||
Tax exempt securities (2) | 460,733 | 4,191 | 3.64 | % | 450,109 | 4,417 | 3.93 | % | ||||||||||||||
Interest-earning deposits with banks | 97,471 | 135 | 0.55 | % | 38,557 | 25 | 0.26 | % | ||||||||||||||
Total interest-earning assets | 8,612,498 | $ | 89,497 | 4.16 | % | 7,937,308 | $ | 85,280 | 4.30 | % | ||||||||||||
Other earning assets | 162,591 | 153,298 | ||||||||||||||||||||
Noninterest-earning assets | 793,125 | 815,137 | ||||||||||||||||||||
Total assets | $ | 9,568,214 | $ | 8,905,743 | ||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||
Certificates of deposit | $ | 410,372 | $ | 114 | 0.11 | % | $ | 460,858 | $ | 179 | 0.16 | % | ||||||||||
Savings accounts | 720,453 | 18 | 0.01 | % | 653,738 | 17 | 0.01 | % | ||||||||||||||
Interest-bearing demand | 969,104 | 154 | 0.06 | % | 920,021 | 161 | 0.07 | % | ||||||||||||||
Money market accounts | 2,051,766 | 496 | 0.10 | % | 1,898,384 | 376 | 0.08 | % | ||||||||||||||
Total interest-bearing deposits | 4,151,695 | 782 | 0.08 | % | 3,933,001 | 733 | 0.07 | % | ||||||||||||||
Federal Home Loan Bank advances | 10,128 | 77 | 3.04 | % | 18,915 | 83 | 1.76 | % | ||||||||||||||
Other borrowings | 60,997 | 138 | 0.90 | % | 79,298 | 134 | 0.68 | % | ||||||||||||||
Total interest-bearing liabilities | 4,222,820 | $ | 997 | 0.09 | % | 4,031,214 | $ | 950 | 0.09 | % | ||||||||||||
Noninterest-bearing deposits | 3,953,827 | 3,507,627 | ||||||||||||||||||||
Other noninterest-bearing liabilities | 117,179 | 107,785 | ||||||||||||||||||||
Shareholders’ equity | 1,274,388 | 1,259,117 | ||||||||||||||||||||
Total liabilities & shareholders’ equity | $ | 9,568,214 | $ | 8,905,743 | ||||||||||||||||||
Net interest income (tax equivalent) | $ | 88,500 | $ | 84,330 | ||||||||||||||||||
Net interest margin (tax equivalent) | 4.11 | % | 4.25 | % |
(1) | Nonaccrual loans have been included in the tables as loans carrying a zero yield. Amortized net deferred loan fees and net unearned discounts on acquired loans were included in the interest income calculations. The amortization of net deferred loan fees was $1.7 million and $1.1 million for the three month periods ended December 31, 2016 and December 31, 2015, respectively. The incremental accretion on acquired loans was $4.3 million and $6.0 million for the three months ended December 31, 2016 and 2015, respectively. |
(2) | Tax-exempt income is calculated on a tax equivalent basis. The tax equivalent yield adjustment to interest earned on loans was $1.3 million and $964 thousand for the three months ended December 31, 2016 and 2015, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $1.5 million for both three months ended December 31, 2016 and 2015. |
AVERAGE BALANCES AND RATES | ||||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||
December 31, 2016 | September 30, 2016 | |||||||||||||||||||||
Average Balances | Interest Earned / Paid | Average Rate | Average Balances | Interest Earned / Paid | Average Rate | |||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||
Loans, net (1)(2) | $ | 6,200,506 | $ | 75,838 | 4.89 | % | $ | 6,179,163 | $ | 76,195 | 4.93 | % | ||||||||||
Taxable securities | 1,853,788 | 9,333 | 2.01 | % | 1,870,466 | 8,988 | 1.92 | % | ||||||||||||||
Tax exempt securities (2) | 460,733 | 4,191 | 3.64 | % | 480,627 | 4,306 | 3.58 | % | ||||||||||||||
Interest-earning deposits with banks | 97,471 | 135 | 0.55 | % | 14,620 | 15 | 0.41 | % | ||||||||||||||
Total interest-earning assets | 8,612,498 | $ | 89,497 | 4.16 | % | 8,544,876 | $ | 89,504 | 4.19 | % | ||||||||||||
Other earning assets | 162,591 | 155,663 | ||||||||||||||||||||
Noninterest-earning assets | 793,125 | 792,912 | ||||||||||||||||||||
Total assets | $ | 9,568,214 | $ | 9,493,451 | ||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||
Certificates of deposit | $ | 410,372 | $ | 114 | 0.11 | % | $ | 417,887 | $ | 124 | 0.12 | % | ||||||||||
Savings accounts | 720,453 | 18 | 0.01 | % | 705,923 | 18 | 0.01 | % | ||||||||||||||
Interest-bearing demand | 969,104 | 154 | 0.06 | % | 961,527 | 189 | 0.08 | % | ||||||||||||||
Money market accounts | 2,051,766 | 496 | 0.10 | % | 2,033,450 | 492 | 0.10 | % | ||||||||||||||
Total interest-bearing deposits | 4,151,695 | 782 | 0.08 | % | 4,118,787 | 823 | 0.08 | % | ||||||||||||||
Federal Home Loan Bank advances | 10,128 | 77 | 3.04 | % | 96,931 | 229 | 0.95 | % | ||||||||||||||
Other borrowings | 60,997 | 138 | 0.90 | % | 79,767 | 134 | 0.67 | % | ||||||||||||||
Total interest-bearing liabilities | 4,222,820 | $ | 997 | 0.09 | % | 4,295,485 | $ | 1,186 | 0.11 | % | ||||||||||||
Noninterest-bearing deposits | 3,953,827 | 3,799,745 | ||||||||||||||||||||
Other noninterest-bearing liabilities | 117,179 | 119,633 | ||||||||||||||||||||
Shareholders’ equity | 1,274,388 | 1,278,588 | ||||||||||||||||||||
Total liabilities & shareholders’ equity | $ | 9,568,214 | $ | 9,493,451 | ||||||||||||||||||
Net interest income (tax equivalent) | $ | 88,500 | $ | 88,318 | ||||||||||||||||||
Net interest margin (tax equivalent) | 4.11 | % | 4.13 | % |
(1) | Nonaccrual loans have been included in the tables as loans carrying a zero yield. Amortized net deferred loan fees and net unearned discounts on acquired loans were included in the interest income calculations. The amortization of net deferred loan fees was $1.7 million and $1.4 million for the three month periods ended December 31, 2016 and September 30, 2016. The incremental accretion on acquired loans was $4.3 million and $4.6 million for the three months ended December 31, 2016 and September 30, 2016, respectively. |
(2) | Tax-exempt income is calculated on a tax equivalent basis. The tax equivalent yield adjustment to interest earned on loans was $1.3 million and $1.2 million for the three months ended December 31, 2016 and September 30, 2016, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $1.5 million and $1.5 million for the three month periods ended December 31, 2016 and September 30, 2016, respectively. |
AVERAGE BALANCES AND RATES | ||||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
Twelve Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||||||||
2016 | 2015 | |||||||||||||||||||||
Average Balances | Interest Earned / Paid | Average Rate | Average Balances | Interest Earned / Paid | Average Rate | |||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||
Loans, net (1)(2) | $ | 6,052,389 | $ | 296,283 | 4.90 | % | $ | 5,609,261 | $ | 289,450 | 5.16 | % | ||||||||||
Taxable securities | 1,804,004 | 35,167 | 1.95 | % | 1,577,711 | 30,774 | 1.95 | % | ||||||||||||||
Tax exempt securities (2) | 465,117 | 17,109 | 3.68 | % | 454,148 | 18,219 | 4.01 | % | ||||||||||||||
Interest-earning deposits with banks | 41,799 | 216 | 0.52 | % | 44,614 | 109 | 0.24 | % | ||||||||||||||
Total interest-earning assets | 8,363,309 | $ | 348,775 | 4.17 | % | 7,685,734 | $ | 338,552 | 4.40 | % | ||||||||||||
Other earning assets | 156,871 | 149,476 | ||||||||||||||||||||
Noninterest-earning assets | 791,441 | 820,033 | ||||||||||||||||||||
Total assets | $ | 9,311,621 | $ | 8,655,243 | ||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||
Certificates of deposit | $ | 426,296 | $ | 522 | 0.12 | % | $ | 483,193 | $ | 868 | 0.18 | % | ||||||||||
Savings accounts | 698,687 | 71 | 0.01 | % | 637,464 | 70 | 0.01 | % | ||||||||||||||
Interest-bearing demand | 952,135 | 695 | 0.07 | % | 982,491 | 612 | 0.06 | % | ||||||||||||||
Money market accounts | 1,993,283 | 1,846 | 0.09 | % | 1,834,733 | 1,427 | 0.08 | % | ||||||||||||||
Total interest-bearing deposits | 4,070,401 | 3,134 | 0.08 | % | 3,937,881 | 2,977 | 0.08 | % | ||||||||||||||
Federal Home Loan Bank advances | 79,673 | 671 | 0.84 | % | 70,678 | 474 | 0.67 | % | ||||||||||||||
Other borrowings | 77,022 | 545 | 0.71 | % | 88,924 | 553 | 0.62 | % | ||||||||||||||
Total interest-bearing liabilities | 4,227,096 | $ | 4,350 | 0.10 | % | 4,097,483 | $ | 4,004 | 0.10 | % | ||||||||||||
Noninterest-bearing deposits | 3,703,908 | 3,208,947 | ||||||||||||||||||||
Other noninterest-bearing liabilities | 110,816 | 101,861 | ||||||||||||||||||||
Shareholders’ equity | 1,269,801 | 1,246,952 | ||||||||||||||||||||
Total liabilities & shareholders’ equity | $ | 9,311,621 | $ | 8,655,243 | ||||||||||||||||||
Net interest income (tax equivalent) | $ | 344,425 | $ | 334,548 | ||||||||||||||||||
Net interest margin (tax equivalent) | 4.12 | % | 4.35 | % |
(1) | Nonaccrual loans have been included in the table as loans carrying a zero yield. Amortized net deferred loan fees and net unearned discounts on acquired loans were included in the interest income calculations. The amortization of net deferred loan fees was $5.3 million and $4.9 million for the twelve months ended December 31, 2016 and 2015, respectively. The incremental accretion on acquired loans was $18.0 million and $27.2 million for the twelve months ended December 31, 2016 and 2015, respectively. |
(2) | Tax-exempt income is calculated on a tax equivalent basis. The tax equivalent yield adjustment to interest earned on loans was $4.8 million and $3.3 million for the twelve months ended December 31, 2016 and 2015, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $6.0 million and $6.4 million for the twelve months ended December 31, 2016 and 2015, respectively. |
Three Months Ended | Twelve Months Ended | |||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||
2016 | 2016 | 2015 | 2016 | 2015 | ||||||||||||||||
Operating net interest margin non-GAAP reconciliation: | (dollars in thousands) | |||||||||||||||||||
Net interest income (tax equivalent) (1) | $ | 88,500 | $ | 88,318 | $ | 84,330 | $ | 344,425 | $ | 334,548 | ||||||||||
Adjustments to arrive at operating net interest income (tax equivalent): | ||||||||||||||||||||
Incremental accretion income on FDIC purchased credit impaired loans | (1,199 | ) | (1,816 | ) | (2,200 | ) | (5,972 | ) | (9,096 | ) | ||||||||||
Incremental accretion income on other FDIC acquired loans (2) | — | — | (68 | ) | — | (234 | ) | |||||||||||||
Incremental accretion income on other acquired loans | (3,087 | ) | (2,749 | ) | (3,746 | ) | (11,983 | ) | (17,862 | ) | ||||||||||
Premium amortization on acquired securities | 1,348 | 1,991 | 2,253 | 7,738 | 10,217 | |||||||||||||||
Interest reversals on nonaccrual loans | 246 | 266 | 582 | 1,072 | 1,713 | |||||||||||||||
Operating net interest income (tax equivalent) (1) | $ | 85,808 | $ | 86,010 | $ | 81,151 | $ | 335,280 | $ | 319,286 | ||||||||||
Average interest earning assets | $ | 8,612,498 | $ | 8,544,876 | $ | 7,937,308 | $ | 8,363,309 | $ | 7,685,734 | ||||||||||
Net interest margin (tax equivalent) (1) | 4.11 | % | 4.13 | % | 4.25 | % | 4.12 | % | 4.35 | % | ||||||||||
Operating net interest margin (tax equivalent) (1) | 3.99 | % | 4.03 | % | 4.09 | % | 4.01 | % | 4.15 | % |
Three Months Ended | Twelve Months Ended | |||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||
2016 | 2016 | 2015 | 2016 | 2015 | ||||||||||||||||
Operating efficiency ratio non-GAAP reconciliation: | (dollars in thousands) | |||||||||||||||||||
Noninterest expense (numerator A) | $ | 65,014 | $ | 67,264 | $ | 66,877 | $ | 261,142 | $ | 266,149 | ||||||||||
Adjustments to arrive at operating noninterest expense: | ||||||||||||||||||||
Acquisition-related expenses | (291 | ) | — | (1,872 | ) | (2,727 | ) | (10,917 | ) | |||||||||||
Net benefit (cost) of operation of OREO and OPPO | (612 | ) | 254 | 150 | (544 | ) | 1,724 | |||||||||||||
FDIC clawback liability expense | 28 | (29 | ) | (812 | ) | (280 | ) | (979 | ) | |||||||||||
Loss on asset disposals | (7 | ) | (31 | ) | (52 | ) | (205 | ) | (433 | ) | ||||||||||
State of Washington Business and Occupation ("B&O") taxes | (995 | ) | (1,382 | ) | (1,294 | ) | (4,752 | ) | (4,962 | ) | ||||||||||
Operating noninterest expense (numerator B) | $ | 63,137 | $ | 66,076 | $ | 62,997 | $ | 252,634 | $ | 250,582 | ||||||||||
Net interest income (tax equivalent) (1) | $ | 88,500 | $ | 88,318 | $ | 84,330 | $ | 344,425 | $ | 334,548 | ||||||||||
Noninterest income | 22,330 | 23,166 | 24,745 | 88,082 | 91,473 | |||||||||||||||
Bank owned life insurance tax equivalent adjustment | 586 | 577 | 576 | 2,448 | 2,391 | |||||||||||||||
Total revenue (tax equivalent) (denominator A) | $ | 111,416 | $ | 112,061 | $ | 109,651 | $ | 434,955 | $ | 428,412 | ||||||||||
Operating net interest income (tax equivalent) (1) | $ | 85,808 | $ | 86,010 | $ | 81,151 | $ | 335,280 | $ | 319,286 | ||||||||||
Adjustments to arrive at operating noninterest income (tax equivalent): | ||||||||||||||||||||
Investment securities gains, net | (7 | ) | (572 | ) | (281 | ) | (1,181 | ) | (1,581 | ) | ||||||||||
Gain on asset disposals | (52 | ) | (16 | ) | (4 | ) | (124 | ) | (129 | ) | ||||||||||
Mortgage loan repurchase liability adjustment | (391 | ) | — | (3,147 | ) | (391 | ) | (3,147 | ) | |||||||||||
Change in FDIC loss-sharing asset | 388 | 104 | 1,031 | 2,585 | 4,010 | |||||||||||||||
Operating noninterest income (tax equivalent) | 22,854 | 23,259 | 22,920 | 91,419 | 93,017 | |||||||||||||||
Total operating revenue (tax equivalent) (denominator B) | $ | 108,662 | $ | 109,269 | $ | 104,071 | $ | 426,699 | $ | 412,303 | ||||||||||
Efficiency ratio (tax equivalent) (numerator A/denominator A) | 58.35 | % | 60.02 | % | 60.99 | % | 60.04 | % | 62.12 | % | ||||||||||
Operating efficiency ratio (tax equivalent) (numerator B/denominator B) | 58.10 | % | 60.47 | % | 60.53 | % | 59.21 | % | 60.78 | % |
Contacts: | Melanie J. Dressel, | |
President and | ||
Chief Executive Officer | ||
Clint E. Stein, | ||
Executive Vice President | ||
and Chief Financial Officer | ||
Investor Relations | ||
(253) 305-1965 |
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