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)) |
COLUMBIA BANKING SYSTEM, INC. | |||||
Date: | July 26, 2018 | /s/ HADLEY S. ROBBINS | |||
Hadley S. Robbins | |||||
President and Chief Executive Officer |
• | Record quarterly net income of $41.7 million; diluted earnings per share of $0.57, which included $0.03 per share negative impact from acquisition-related expenses |
• | Net interest margin of 4.29%, up 7 basis points from linked quarter |
• | Record second quarter loan production of $372.7 million |
• | Nonperforming assets to period end assets ratio decreased to 0.61% |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
2018 | 2018 | 2017 | 2017 | 2017 | 2018 | 2017 | ||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||
Incremental accretion income due to: | ||||||||||||||||||||||||||||
FDIC purchased credit impaired loans | $ | 326 | $ | 329 | $ | 265 | $ | 972 | $ | 753 | $ | 655 | $ | 2,870 | ||||||||||||||
Other acquired loans | 2,690 | 3,370 | 2,482 | 1,903 | 2,356 | 6,060 | 4,304 | |||||||||||||||||||||
Incremental accretion income | $ | 3,016 | $ | 3,699 | $ | 2,747 | $ | 2,875 | $ | 3,109 | $ | 6,715 | $ | 7,174 | ||||||||||||||
Net interest margin (tax equivalent) | 4.29 | % | 4.22 | % | 4.20 | % | 4.20 | % | 4.12 | % | 4.26 | % | 4.16 | % | ||||||||||||||
Operating net interest margin (tax equivalent) (1) | 4.27 | % | 4.18 | % | 4.25 | % | 4.15 | % | 4.09 | % | 4.22 | % | 4.09 | % |
June 30, 2018 | March 31, 2018 | December 31, 2017 | ||||||||||
(in thousands) | ||||||||||||
Nonaccrual loans: | ||||||||||||
Commercial business | $ | 52,036 | $ | 57,619 | $ | 45,460 | ||||||
Real estate: | ||||||||||||
One-to-four family residential | 976 | 1,054 | 785 | |||||||||
Commercial and multifamily residential | 11,118 | 14,539 | 13,941 | |||||||||
Total real estate | 12,094 | 15,593 | 14,726 | |||||||||
Real estate construction: | ||||||||||||
One-to-four family residential | 389 | 1,210 | 1,854 | |||||||||
Total real estate construction | 389 | 1,210 | 1,854 | |||||||||
Consumer | 4,985 | 4,042 | 4,149 | |||||||||
Total nonaccrual loans | 69,504 | 78,464 | 66,189 | |||||||||
Other real estate owned and other personal property owned | 7,080 | 11,507 | 13,298 | |||||||||
Total nonperforming assets | $ | 76,584 | $ | 89,971 | $ | 79,487 |
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Beginning balance | $ | 79,827 | $ | 75,646 | $ | 71,021 | $ | 75,646 | $ | 70,043 | ||||||||||
Charge-offs: | ||||||||||||||||||||
Commercial business | (5,775 | ) | (2,477 | ) | (3,600 | ) | (8,252 | ) | (4,727 | ) | ||||||||||
One-to-four family residential real estate | — | — | (153 | ) | — | (460 | ) | |||||||||||||
Commercial and multifamily residential real estate | — | (223 | ) | — | (223 | ) | — | |||||||||||||
One-to-four family residential real estate construction | — | — | — | — | (14 | ) | ||||||||||||||
Consumer | (232 | ) | (264 | ) | (465 | ) | (496 | ) | (893 | ) | ||||||||||
Purchased credit impaired | (1,235 | ) | (1,343 | ) | (1,800 | ) | (2,578 | ) | (3,739 | ) | ||||||||||
Total charge-offs | (7,242 | ) | (4,307 | ) | (6,018 | ) | (11,549 | ) | (9,833 | ) | ||||||||||
Recoveries: | ||||||||||||||||||||
Commercial business | 1,543 | 802 | 2,944 | 2,345 | 3,309 | |||||||||||||||
One-to-four family residential real estate | 196 | 172 | 223 | 368 | 340 | |||||||||||||||
Commercial and multifamily residential real estate | 640 | 159 | 127 | 799 | 205 | |||||||||||||||
One-to-four family residential real estate construction | 14 | 19 | 58 | 33 | 87 | |||||||||||||||
Consumer | 270 | 260 | 248 | 530 | 533 | |||||||||||||||
Purchased credit impaired | 927 | 1,224 | 1,204 | 2,151 | 2,348 | |||||||||||||||
Total recoveries | 3,590 | 2,636 | 4,804 | 6,226 | 6,822 | |||||||||||||||
Net charge-offs | (3,652 | ) | (1,671 | ) | (1,214 | ) | (5,323 | ) | (3,011 | ) | ||||||||||
Provision for loan and lease losses | 3,975 | 5,852 | 3,177 | 9,827 | 5,952 | |||||||||||||||
Ending balance | $ | 80,150 | $ | 79,827 | $ | 72,984 | $ | 80,150 | $ | 72,984 |
Contacts: | Hadley S. Robbins, |
President and | |
Chief Executive Officer | |
Gregory A. Sigrist, | |
Executive Vice President and | |
Chief Financial Officer | |
Investor Relations | |
InvestorRelations@columbiabank.com | |
253-305-1921 |
CONSOLIDATED BALANCE SHEETS | ||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||
Unaudited | June 30, | March 31, | December 31, | |||||||||||||||||
2018 | 2018 | 2017 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and due from banks | $ | 224,370 | $ | 206,532 | $ | 244,615 | ||||||||||||||
Interest-earning deposits with banks | 39,169 | 87,124 | 97,918 | |||||||||||||||||
Total cash and cash equivalents | 263,539 | 293,656 | 342,533 | |||||||||||||||||
Debt securities available for sale at fair value | 2,646,208 | 2,624,045 | 2,737,751 | |||||||||||||||||
Equity securities at fair value | 4,963 | 5,000 | 5,080 | |||||||||||||||||
Federal Home Loan Bank ("FHLB") stock at cost | 13,960 | 11,640 | 10,440 | |||||||||||||||||
Loans held for sale | 6,773 | 4,312 | 5,766 | |||||||||||||||||
Loans, net of unearned income | 8,454,107 | 8,339,631 | 8,358,657 | |||||||||||||||||
Less: allowance for loan and lease losses | 80,150 | 79,827 | 75,646 | |||||||||||||||||
Loans, net | 8,373,957 | 8,259,804 | 8,283,011 | |||||||||||||||||
Interest receivable | 43,105 | 41,795 | 40,881 | |||||||||||||||||
Premises and equipment, net | 168,315 | 168,366 | 169,490 | |||||||||||||||||
Other real estate owned | 7,080 | 11,507 | 13,298 | |||||||||||||||||
Goodwill | 765,842 | 765,842 | 765,842 | |||||||||||||||||
Other intangible assets, net | 51,897 | 54,985 | 58,173 | |||||||||||||||||
Other assets | 282,947 | 289,684 | 284,621 | |||||||||||||||||
Total assets | $ | 12,628,586 | $ | 12,530,636 | $ | 12,716,886 | ||||||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
Noninterest-bearing | $ | 4,953,993 | $ | 4,927,226 | $ | 5,081,901 | ||||||||||||||
Interest-bearing | 5,430,011 | 5,468,297 | 5,450,184 | |||||||||||||||||
Total deposits | 10,384,004 | 10,395,523 | 10,532,085 | |||||||||||||||||
FHLB advances | 99,549 | 41,564 | 11,579 | |||||||||||||||||
Securities sold under agreements to repurchase | 46,229 | 24,247 | 79,059 | |||||||||||||||||
Subordinated debentures | 35,555 | 35,601 | 35,647 | |||||||||||||||||
Junior subordinated debentures | — | — | 8,248 | |||||||||||||||||
Other liabilities | 98,368 | 85,778 | 100,346 | |||||||||||||||||
Total liabilities | 10,663,705 | 10,582,713 | 10,766,964 | |||||||||||||||||
Commitments and contingent liabilities | ||||||||||||||||||||
June 30, | March 31, | December 31, | ||||||||||||||||||
2018 | 2018 | 2017 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Common stock (no par value) | ||||||||||||||||||||
Authorized shares | 115,000 | 115,000 | 115,000 | |||||||||||||||||
Issued and outstanding | 73,245 | 73,240 | 73,020 | 1,636,903 | 1,634,916 | 1,634,705 | ||||||||||||||
Retained earnings | 383,899 | 361,140 | 337,442 | |||||||||||||||||
Accumulated other comprehensive loss | (55,921 | ) | (48,133 | ) | (22,225 | ) | ||||||||||||||
Total shareholders' equity | 1,964,881 | 1,947,923 | 1,949,922 | |||||||||||||||||
Total liabilities and shareholders' equity | $ | 12,628,586 | $ | 12,530,636 | $ | 12,716,886 |
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||||
Columbia Banking System, Inc. | Three Months Ended | Six Months Ended | ||||||||||||||||||
Unaudited | June 30, | March 31, | June 30, | June 30, | June 30, | |||||||||||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Interest Income | (in thousands except per share) | |||||||||||||||||||
Loans | $ | 105,412 | $ | 103,027 | $ | 75,579 | $ | 208,439 | $ | 149,699 | ||||||||||
Taxable securities | 11,923 | 12,708 | 9,468 | 24,631 | 20,454 | |||||||||||||||
Tax-exempt securities | 3,063 | 3,064 | 2,716 | 6,127 | 5,407 | |||||||||||||||
Deposits in banks | 151 | 345 | 23 | 496 | 42 | |||||||||||||||
Total interest income | 120,549 | 119,144 | 87,786 | 239,693 | 175,602 | |||||||||||||||
Interest Expense | ||||||||||||||||||||
Deposits | 2,572 | 2,509 | 908 | 5,081 | 1,695 | |||||||||||||||
FHLB advances | 815 | 570 | 591 | 1,385 | 816 | |||||||||||||||
Subordinated debentures | 468 | 468 | — | 936 | — | |||||||||||||||
Other borrowings | 20 | 116 | 126 | 136 | 255 | |||||||||||||||
Total interest expense | 3,875 | 3,663 | 1,625 | 7,538 | 2,766 | |||||||||||||||
Net Interest Income | 116,674 | 115,481 | 86,161 | 232,155 | 172,836 | |||||||||||||||
Provision for loan and lease losses | 3,975 | 5,852 | 3,177 | 9,827 | 5,952 | |||||||||||||||
Net interest income after provision for loan and lease losses | 112,699 | 109,629 | 82,984 | 222,328 | 166,884 | |||||||||||||||
Noninterest Income | ||||||||||||||||||||
Deposit account and treasury management fees | 8,683 | 8,740 | 7,396 | 17,423 | 14,683 | |||||||||||||||
Card revenue | 6,616 | 5,813 | 6,202 | 12,429 | 11,925 | |||||||||||||||
Financial services and trust revenue | 3,219 | 2,730 | 3,036 | 5,949 | 5,875 | |||||||||||||||
Loan revenue | 3,054 | 3,186 | 2,989 | 6,240 | 6,582 | |||||||||||||||
Merchant processing revenue | — | — | 2,264 | — | 4,283 | |||||||||||||||
Bank owned life insurance | 1,712 | 1,426 | 1,433 | 3,138 | 2,713 | |||||||||||||||
Investment securities gains (losses), net | (33 | ) | 22 | — | (11 | ) | — | |||||||||||||
Change in FDIC loss-sharing asset | — | — | (173 | ) | — | (447 | ) | |||||||||||||
Other | 441 | 1,226 | 988 | 1,667 | 3,380 | |||||||||||||||
Total noninterest income | 23,692 | 23,143 | 24,135 | 46,835 | 48,994 | |||||||||||||||
Noninterest Expense | ||||||||||||||||||||
Compensation and employee benefits | 48,949 | 50,570 | 38,393 | 99,519 | 79,218 | |||||||||||||||
Occupancy | 9,276 | 10,121 | 7,577 | 19,397 | 14,768 | |||||||||||||||
Merchant processing expense | — | — | 1,147 | — | 2,196 | |||||||||||||||
Advertising and promotion | 1,622 | 1,429 | 1,137 | 3,051 | 1,954 | |||||||||||||||
Data processing | 5,221 | 5,270 | 4,741 | 10,491 | 8,949 | |||||||||||||||
Legal and professional fees | 4,171 | 3,237 | 2,947 | 7,408 | 6,316 | |||||||||||||||
Taxes, licenses and fees | 1,560 | 1,425 | 748 | 2,985 | 1,989 | |||||||||||||||
Regulatory premiums | 937 | 937 | 741 | 1,874 | 1,517 | |||||||||||||||
Net cost (benefit) of operation of other real estate owned | 758 | 1 | (1 | ) | 759 | 151 | ||||||||||||||
Amortization of intangibles | 3,088 | 3,188 | 1,249 | 6,276 | 2,598 | |||||||||||||||
Other | 9,061 | 9,809 | 10,188 | 18,870 | 18,197 | |||||||||||||||
Total noninterest expense | 84,643 | 85,987 | 68,867 | 170,630 | 137,853 | |||||||||||||||
Income before income taxes | 51,748 | 46,785 | 38,252 | 98,533 | 78,025 | |||||||||||||||
Provision for income taxes | 9,999 | 6,815 | 11,120 | 16,814 | 21,694 | |||||||||||||||
Net Income | $ | 41,749 | $ | 39,970 | $ | 27,132 | $ | 81,719 | $ | 56,331 | ||||||||||
Earnings per common share | ||||||||||||||||||||
Basic | $ | 0.57 | $ | 0.55 | $ | 0.47 | $ | 1.12 | $ | 0.97 | ||||||||||
Diluted | $ | 0.57 | $ | 0.55 | $ | 0.47 | $ | 1.12 | $ | 0.97 | ||||||||||
Dividends declared per common share | $ | 0.26 | $ | 0.22 | $ | 0.22 | $ | 0.48 | $ | 0.44 | ||||||||||
Weighted average number of common shares outstanding | 72,385 | 72,300 | 57,520 | 72,343 | 57,437 | |||||||||||||||
Weighted average number of diluted common shares outstanding | 72,390 | 72,305 | 57,525 | 72,347 | 57,442 |
FINANCIAL STATISTICS | ||||||||||||||||||||
Columbia Banking System, Inc. | Three Months Ended | Six Months Ended | ||||||||||||||||||
Unaudited | June 30, | March 31, | June 30, | June 30, | June 30, | |||||||||||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Earnings | (dollars in thousands except per share amounts) | |||||||||||||||||||
Net interest income | $ | 116,674 | $ | 115,481 | $ | 86,161 | $ | 232,155 | $ | 172,836 | ||||||||||
Provision for loan and lease losses | $ | 3,975 | $ | 5,852 | $ | 3,177 | $ | 9,827 | $ | 5,952 | ||||||||||
Noninterest income | $ | 23,692 | $ | 23,143 | $ | 24,135 | $ | 46,835 | $ | 48,994 | ||||||||||
Noninterest expense | $ | 84,643 | $ | 85,987 | $ | 68,867 | $ | 170,630 | $ | 137,853 | ||||||||||
Acquisition-related expense (included in noninterest expense) | $ | 2,822 | $ | 4,265 | $ | 1,023 | $ | 7,087 | $ | 2,387 | ||||||||||
Net income | $ | 41,749 | $ | 39,970 | $ | 27,132 | $ | 81,719 | $ | 56,331 | ||||||||||
Per Common Share | ||||||||||||||||||||
Earnings (basic) | $ | 0.57 | $ | 0.55 | $ | 0.47 | $ | 1.12 | $ | 0.97 | ||||||||||
Earnings (diluted) | $ | 0.57 | $ | 0.55 | $ | 0.47 | $ | 1.12 | $ | 0.97 | ||||||||||
Book value | $ | 26.83 | $ | 26.60 | $ | 22.23 | $ | 26.83 | $ | 22.23 | ||||||||||
Tangible book value per common share (2) | $ | 15.66 | $ | 15.39 | $ | 15.42 | $ | 15.66 | $ | 15.42 | ||||||||||
Averages | ||||||||||||||||||||
Total assets | $ | 12,529,540 | $ | 12,603,144 | $ | 9,597,274 | $ | 12,566,138 | $ | 9,535,827 | ||||||||||
Interest-earning assets | $ | 11,052,807 | $ | 11,122,753 | $ | 8,651,735 | $ | 11,087,587 | $ | 8,586,376 | ||||||||||
Loans | $ | 8,389,230 | $ | 8,348,740 | $ | 6,325,462 | $ | 8,369,097 | $ | 6,262,190 | ||||||||||
Securities, including equity securities and FHLB stock | $ | 2,628,292 | $ | 2,682,250 | $ | 2,316,077 | $ | 2,655,122 | $ | 2,313,299 | ||||||||||
Deposits | $ | 10,264,822 | $ | 10,334,480 | $ | 7,965,868 | $ | 10,299,459 | $ | 7,960,292 | ||||||||||
Interest-bearing deposits | $ | 5,390,869 | $ | 5,405,730 | $ | 4,123,135 | $ | 5,398,259 | $ | 4,120,882 | ||||||||||
Interest-bearing liabilities | $ | 5,611,055 | $ | 5,627,853 | $ | 4,367,216 | $ | 5,619,408 | $ | 4,315,724 | ||||||||||
Noninterest-bearing deposits | $ | 4,873,953 | $ | 4,928,750 | $ | 3,842,733 | $ | 4,901,200 | $ | 3,839,410 | ||||||||||
Shareholders' equity | $ | 1,954,552 | $ | 1,949,275 | $ | 1,295,564 | $ | 1,951,928 | $ | 1,278,702 | ||||||||||
Financial Ratios | ||||||||||||||||||||
Return on average assets | 1.33 | % | 1.27 | % | 1.13 | % | 1.30 | % | 1.18 | % | ||||||||||
Return on average common equity | 8.54 | % | 8.20 | % | 8.38 | % | 8.37 | % | 8.81 | % | ||||||||||
Return on average tangible common equity (2) | 15.57 | % | 15.08 | % | 12.46 | % | 15.33 | % | 13.19 | % | ||||||||||
Average equity to average assets | 15.60 | % | 15.47 | % | 13.50 | % | 15.53 | % | 13.41 | % | ||||||||||
Shareholders equity to total assets | 15.56 | % | 15.55 | % | 13.39 | % | 15.56 | % | 13.39 | % | ||||||||||
Tangible common shareholders' equity to tangible assets (2) | 9.71 | % | 9.63 | % | 9.69 | % | 9.71 | % | 9.69 | % | ||||||||||
Net interest margin (tax equivalent) | 4.29 | % | 4.22 | % | 4.12 | % | 4.26 | % | 4.16 | % | ||||||||||
Efficiency ratio (tax equivalent) (1) | 59.29 | % | 61.04 | % | 60.42 | % | 60.16 | % | 60.19 | % | ||||||||||
Operating efficiency ratio (tax equivalent) (2) | 56.02 | % | 57.59 | % | 57.23 | % | 56.80 | % | 58.15 | % | ||||||||||
Noninterest expense ratio | 2.70 | % | 2.73 | % | 2.87 | % | 2.72 | % | 2.89 | % | ||||||||||
Core noninterest expense ratio (2) | 2.61 | % | 2.59 | % | 2.73 | % | 2.60 | % | 2.79 | % | ||||||||||
June 30, | March 31, | December 31, | ||||||||||||||||||
Period end | 2018 | 2018 | 2017 | |||||||||||||||||
Total assets | $ | 12,628,586 | $ | 12,530,636 | $ | 12,716,886 | ||||||||||||||
Loans, net of unearned income | $ | 8,454,107 | $ | 8,339,631 | $ | 8,358,657 | ||||||||||||||
Allowance for loan and lease losses | $ | 80,150 | $ | 79,827 | $ | 75,646 | ||||||||||||||
Securities, including equity securities and FHLB stock | $ | 2,665,131 | $ | 2,640,685 | $ | 2,753,271 | ||||||||||||||
Deposits | $ | 10,384,004 | $ | 10,395,523 | $ | 10,532,085 | ||||||||||||||
Core deposits | $ | 9,888,696 | $ | 9,897,185 | $ | 10,039,557 | ||||||||||||||
Shareholders' equity | $ | 1,964,881 | $ | 1,947,923 | $ | 1,949,922 | ||||||||||||||
Nonperforming assets | ||||||||||||||||||||
Nonaccrual loans | $ | 69,504 | $ | 78,464 | $ | 66,189 | ||||||||||||||
Other real estate owned ("OREO") and other personal property owned ("OPPO") | 7,080 | 11,507 | 13,298 | |||||||||||||||||
Total nonperforming assets | $ | 76,584 | $ | 89,971 | $ | 79,487 | ||||||||||||||
Nonperforming loans to period-end loans | 0.82 | % | 0.94 | % | 0.79 | % | ||||||||||||||
Nonperforming assets to period-end assets | 0.61 | % | 0.72 | % | 0.63 | % | ||||||||||||||
Allowance for loan and lease losses to period-end loans | 0.95 | % | 0.96 | % | 0.91 | % | ||||||||||||||
Net loan charge-offs (recoveries) (3) | $ | 3,652 | $ | 1,671 | $ | (703 | ) | |||||||||||||
(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) This is a non-GAAP measure. See section titled "Non-GAAP Financial Measures" on the last three pages of this earnings release for a reconciliation to the most comparable GAAP measure. | ||||||||||||||||||||
(3) For the three months ended. |
QUARTERLY FINANCIAL STATISTICS | ||||||||||||||||||||
Columbia Banking System, Inc. | Three Months Ended | |||||||||||||||||||
Unaudited | June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||||
2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||||||||
Earnings | (dollars in thousands except per share) | |||||||||||||||||||
Net interest income | $ | 116,674 | $ | 115,481 | $ | 106,224 | $ | 88,929 | $ | 86,161 | ||||||||||
Provision (recapture) for loan and lease losses | $ | 3,975 | $ | 5,852 | $ | 3,327 | $ | (648 | ) | $ | 3,177 | |||||||||
Noninterest income | $ | 23,692 | $ | 23,143 | $ | 23,581 | $ | 37,067 | $ | 24,135 | ||||||||||
Noninterest expense | $ | 84,643 | $ | 85,987 | $ | 85,627 | $ | 67,537 | $ | 68,867 | ||||||||||
Acquisition-related expense (included in noninterest expense) | $ | 2,822 | $ | 4,265 | $ | 13,638 | $ | 1,171 | $ | 1,023 | ||||||||||
Net income | $ | 41,749 | $ | 39,970 | $ | 15,728 | $ | 40,769 | $ | 27,132 | ||||||||||
Per Common Share | ||||||||||||||||||||
Earnings (basic) | $ | 0.57 | $ | 0.55 | $ | 0.23 | $ | 0.70 | $ | 0.47 | ||||||||||
Earnings (diluted) | $ | 0.57 | $ | 0.55 | $ | 0.23 | $ | 0.70 | $ | 0.47 | ||||||||||
Book value | $ | 26.83 | $ | 26.60 | $ | 26.70 | $ | 22.76 | $ | 22.23 | ||||||||||
Tangible book value per common share (1) | $ | 15.66 | $ | 15.39 | $ | 15.42 | $ | 15.96 | $ | 15.42 | ||||||||||
Averages | ||||||||||||||||||||
Total assets | $ | 12,529,540 | $ | 12,603,144 | $ | 11,751,049 | $ | 9,695,005 | $ | 9,597,274 | ||||||||||
Interest-earning assets | $ | 11,052,807 | $ | 11,122,753 | $ | 10,453,097 | $ | 8,750,561 | $ | 8,651,735 | ||||||||||
Loans | $ | 8,389,230 | $ | 8,348,740 | $ | 7,749,420 | $ | 6,441,537 | $ | 6,325,462 | ||||||||||
Securities, including equity securities and FHLB stock | $ | 2,628,292 | $ | 2,682,250 | $ | 2,539,321 | $ | 2,236,235 | $ | 2,316,077 | ||||||||||
Deposits | $ | 10,264,822 | $ | 10,334,480 | $ | 9,804,456 | $ | 8,187,337 | $ | 7,965,868 | ||||||||||
Interest-bearing deposits | $ | 5,390,869 | $ | 5,405,730 | $ | 5,033,980 | $ | 4,200,580 | $ | 4,123,135 | ||||||||||
Interest-bearing liabilities | $ | 5,611,055 | $ | 5,627,853 | $ | 5,127,100 | $ | 4,285,936 | $ | 4,367,216 | ||||||||||
Noninterest-bearing deposits | $ | 4,873,953 | $ | 4,928,750 | $ | 4,770,476 | $ | 3,986,757 | $ | 3,842,733 | ||||||||||
Shareholders' equity | $ | 1,954,552 | $ | 1,949,275 | $ | 1,754,745 | $ | 1,323,794 | $ | 1,295,564 | ||||||||||
Financial Ratios | ||||||||||||||||||||
Return on average assets | 1.33 | % | 1.27 | % | 0.54 | % | 1.68 | % | 1.13 | % | ||||||||||
Return on average common equity | 8.54 | % | 8.20 | % | 3.59 | % | 12.32 | % | 8.38 | % | ||||||||||
Return on average tangible common equity (1) | 15.57 | % | 15.08 | % | 6.37 | % | 17.93 | % | 12.46 | % | ||||||||||
Average equity to average assets | 15.60 | % | 15.47 | % | 14.93 | % | 13.65 | % | 13.50 | % | ||||||||||
Shareholders' equity to total assets | 15.56 | % | 15.55 | % | 15.33 | % | 13.54 | % | 13.39 | % | ||||||||||
Tangible common shareholders' equity to tangible assets (1) | 9.71 | % | 9.63 | % | 9.47 | % | 9.89 | % | 9.69 | % | ||||||||||
Net interest margin (tax equivalent) | 4.29 | % | 4.22 | % | 4.20 | % | 4.20 | % | 4.12 | % | ||||||||||
Period end | ||||||||||||||||||||
Total assets | $ | 12,628,586 | $ | 12,530,636 | $ | 12,716,886 | $ | 9,814,578 | $ | 9,685,110 | ||||||||||
Loans, net of unearned income | $ | 8,454,107 | $ | 8,339,631 | $ | 8,358,657 | $ | 6,512,006 | $ | 6,423,074 | ||||||||||
Allowance for loan and lease losses | $ | 80,150 | $ | 79,827 | $ | 75,646 | $ | 71,616 | $ | 72,984 | ||||||||||
Securities, including equity securities and FHLB stock | $ | 2,665,131 | $ | 2,640,685 | $ | 2,753,271 | $ | 2,218,113 | $ | 2,280,996 | ||||||||||
Deposits | $ | 10,384,004 | $ | 10,395,523 | $ | 10,532,085 | $ | 8,341,717 | $ | 8,072,464 | ||||||||||
Core deposits | $ | 9,888,696 | $ | 9,897,185 | $ | 10,039,557 | $ | 7,999,499 | $ | 7,721,766 | ||||||||||
Shareholders' equity | $ | 1,964,881 | $ | 1,947,923 | $ | 1,949,922 | $ | 1,328,428 | $ | 1,297,314 | ||||||||||
Goodwill | $ | 765,842 | $ | 765,842 | $ | 765,842 | $ | 382,762 | $ | 382,762 | ||||||||||
Other intangible assets, net | $ | 51,897 | $ | 54,985 | $ | 58,173 | $ | 13,845 | $ | 15,033 | ||||||||||
Nonperforming assets | ||||||||||||||||||||
Nonaccrual loans | $ | 69,504 | $ | 78,464 | $ | 66,189 | $ | 40,317 | $ | 36,824 | ||||||||||
OREO and OPPO | 7,080 | 11,507 | 13,298 | 3,682 | 4,058 | |||||||||||||||
Total nonperforming assets | $ | 76,584 | $ | 89,971 | $ | 79,487 | $ | 43,999 | $ | 40,882 | ||||||||||
Nonperforming loans to period-end loans | 0.82 | % | 0.94 | % | 0.79 | % | 0.62 | % | 0.57 | % | ||||||||||
Nonperforming assets to period-end assets | 0.61 | % | 0.72 | % | 0.63 | % | 0.45 | % | 0.42 | % | ||||||||||
Allowance for loan and lease losses to period-end loans | 0.95 | % | 0.96 | % | 0.91 | % | 1.10 | % | 1.14 | % | ||||||||||
Net loan charge-offs (recoveries) | $ | 3,652 | $ | 1,671 | $ | (703 | ) | $ | 720 | $ | 1,214 | |||||||||
(1) This is a non-GAAP measure. See section titled "Non-GAAP Financial Measures" on the last three pages of this earnings release for a reconciliation to the most comparable GAAP measure. |
LOAN PORTFOLIO COMPOSITION | ||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||
Unaudited | June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||||
2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||||||||
Loan Portfolio Composition - Dollars | (dollars in thousands) | |||||||||||||||||||
Commercial business | $ | 3,538,492 | $ | 3,402,162 | $ | 3,377,324 | $ | 2,735,206 | $ | 2,704,468 | ||||||||||
Real estate: | ||||||||||||||||||||
One-to-four family residential | 180,522 | 182,302 | 188,396 | 176,487 | 173,150 | |||||||||||||||
Commercial and multifamily residential | 3,758,207 | 3,776,709 | 3,825,739 | 2,825,794 | 2,787,560 | |||||||||||||||
Total real estate | 3,938,729 | 3,959,011 | 4,014,135 | 3,002,281 | 2,960,710 | |||||||||||||||
Real estate construction: | ||||||||||||||||||||
One-to-four family residential | 206,181 | 208,441 | 200,518 | 145,419 | 139,956 | |||||||||||||||
Commercial and multifamily residential | 387,951 | 385,339 | 371,931 | 213,939 | 195,565 | |||||||||||||||
Total real estate construction | 594,132 | 593,780 | 572,449 | 359,358 | 335,521 | |||||||||||||||
Consumer | 326,402 | 323,631 | 334,190 | 323,913 | 323,187 | |||||||||||||||
Purchased credit impaired | 101,782 | 109,299 | 112,670 | 120,477 | 129,853 | |||||||||||||||
Subtotal loans | 8,499,537 | 8,387,883 | 8,410,768 | 6,541,235 | 6,453,739 | |||||||||||||||
Less: Net unearned income | (45,430 | ) | (48,252 | ) | (52,111 | ) | (29,229 | ) | (30,665 | ) | ||||||||||
Loans, net of unearned income | 8,454,107 | 8,339,631 | 8,358,657 | 6,512,006 | 6,423,074 | |||||||||||||||
Less: Allowance for loan and lease losses | (80,150 | ) | (79,827 | ) | (75,646 | ) | (71,616 | ) | (72,984 | ) | ||||||||||
Total loans, net | 8,373,957 | 8,259,804 | 8,283,011 | 6,440,390 | 6,350,090 | |||||||||||||||
Loans held for sale | $ | 6,773 | $ | 4,312 | $ | 5,766 | $ | 7,802 | $ | 6,918 |
June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||
Loan Portfolio Composition - Percentages | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||
Commercial business | 41.9 | % | 40.8 | % | 40.4 | % | 42.0 | % | 42.1 | % | |||||
Real estate: | |||||||||||||||
One-to-four family residential | 2.1 | % | 2.2 | % | 2.3 | % | 2.7 | % | 2.7 | % | |||||
Commercial and multifamily residential | 44.4 | % | 45.3 | % | 45.8 | % | 43.3 | % | 43.5 | % | |||||
Total real estate | 46.5 | % | 47.5 | % | 48.1 | % | 46.0 | % | 46.2 | % | |||||
Real estate construction: | |||||||||||||||
One-to-four family residential | 2.4 | % | 2.5 | % | 2.4 | % | 2.2 | % | 2.2 | % | |||||
Commercial and multifamily residential | 4.6 | % | 4.6 | % | 4.4 | % | 3.3 | % | 3.0 | % | |||||
Total real estate construction | 7.0 | % | 7.1 | % | 6.8 | % | 5.5 | % | 5.2 | % | |||||
Consumer | 3.9 | % | 3.9 | % | 4.0 | % | 5.0 | % | 5.0 | % | |||||
Purchased credit impaired | 1.2 | % | 1.3 | % | 1.3 | % | 1.9 | % | 2.0 | % | |||||
Subtotal loans | 100.5 | % | 100.6 | % | 100.6 | % | 100.4 | % | 100.5 | % | |||||
Less: Net unearned income | (0.5 | )% | (0.6 | )% | (0.6 | )% | (0.4 | )% | (0.5 | )% | |||||
Loans, net of unearned income | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
DEPOSIT COMPOSITION | ||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||
Unaudited | ||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||||||||
Deposit Composition - Dollars | (dollars in thousands) | |||||||||||||||||||
Core deposits: | ||||||||||||||||||||
Demand and other non-interest bearing | $ | 4,953,993 | $ | 4,927,226 | $ | 5,081,901 | $ | 4,119,950 | $ | 3,905,652 | ||||||||||
Interest bearing demand | 1,278,686 | 1,328,756 | 1,265,212 | 1,009,378 | 988,532 | |||||||||||||||
Money market | 2,513,648 | 2,477,487 | 2,543,712 | 1,821,262 | 1,787,101 | |||||||||||||||
Savings | 875,707 | 886,171 | 861,941 | 772,858 | 756,825 | |||||||||||||||
Certificates of deposit, less than $250,000 | 266,662 | 277,545 | 286,791 | 276,051 | 283,656 | |||||||||||||||
Total core deposits | 9,888,696 | 9,897,185 | 10,039,557 | 7,999,499 | 7,721,766 | |||||||||||||||
Certificates of deposit, $250,000 or more | 91,578 | 96,333 | 100,399 | 84,105 | 81,861 | |||||||||||||||
Certificates of deposit insured by CDARS® (1) | 23,492 | 23,191 | 25,374 | 20,690 | 19,276 | |||||||||||||||
Brokered certificates of deposit | 68,870 | 76,931 | 78,481 | — | — | |||||||||||||||
Reciprocal money market accounts (1) | 311,935 | 302,544 | 289,031 | 237,421 | 249,554 | |||||||||||||||
Subtotal | 10,384,571 | 10,396,184 | 10,532,842 | 8,341,715 | 8,072,457 | |||||||||||||||
Premium (discount) resulting from acquisition date fair value adjustment | (567 | ) | (661 | ) | (757 | ) | 2 | 7 | ||||||||||||
Total deposits | $ | 10,384,004 | $ | 10,395,523 | $ | 10,532,085 | $ | 8,341,717 | $ | 8,072,464 |
June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||
Deposit Composition - Percentages | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||
Core deposits: | |||||||||||||||
Demand and other non-interest bearing | 47.7 | % | 47.4 | % | 48.2 | % | 49.4 | % | 48.4 | % | |||||
Interest bearing demand | 12.3 | % | 12.8 | % | 12.0 | % | 12.1 | % | 12.2 | % | |||||
Money market | 24.2 | % | 23.8 | % | 24.2 | % | 21.8 | % | 22.1 | % | |||||
Savings | 8.4 | % | 8.5 | % | 8.2 | % | 9.3 | % | 9.4 | % | |||||
Certificates of deposit, less than $250,000 | 2.6 | % | 2.7 | % | 2.7 | % | 3.3 | % | 3.5 | % | |||||
Total core deposits | 95.2 | % | 95.2 | % | 95.3 | % | 95.9 | % | 95.6 | % | |||||
Certificates of deposit, $250,000 or more | 0.9 | % | 0.9 | % | 1.0 | % | 1.0 | % | 1.0 | % | |||||
Certificates of deposit insured by CDARS® (1) | 0.2 | % | 0.2 | % | 0.2 | % | 0.2 | % | 0.2 | % | |||||
Brokered certificates of deposit | 0.7 | % | 0.7 | % | 0.7 | % | — | % | — | % | |||||
Reciprocal money market accounts (1) | 3.0 | % | 3.0 | % | 2.8 | % | 2.9 | % | 3.2 | % | |||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
AVERAGE BALANCES AND RATES | ||||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||
June 30, 2018 | June 30, 2017 | |||||||||||||||||||||
Average Balances | Interest Earned / Paid | Average Rate | Average Balances | Interest Earned / Paid | Average Rate | |||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||
Loans, net (1)(2) | $ | 8,389,230 | $ | 106,526 | 5.08 | % | $ | 6,325,462 | $ | 77,030 | 4.87 | % | ||||||||||
Taxable securities | 2,111,086 | 11,923 | 2.26 | % | 1,861,895 | 9,468 | 2.03 | % | ||||||||||||||
Tax exempt securities (2) | 517,206 | 3,877 | 3.00 | % | 454,182 | 4,179 | 3.68 | % | ||||||||||||||
Interest-earning deposits with banks | 35,285 | 151 | 1.71 | % | 10,196 | 23 | 0.90 | % | ||||||||||||||
Total interest-earning assets | 11,052,807 | $ | 122,477 | 4.43 | % | 8,651,735 | $ | 90,700 | 4.19 | % | ||||||||||||
Other earning assets | 221,141 | 173,044 | ||||||||||||||||||||
Noninterest-earning assets | 1,255,592 | 772,495 | ||||||||||||||||||||
Total assets | $ | 12,529,540 | $ | 9,597,274 | ||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||
Certificates of deposit | $ | 464,217 | $ | 549 | 0.47 | % | $ | 386,361 | $ | 95 | 0.10 | % | ||||||||||
Savings accounts | 875,529 | 30 | 0.01 | % | 755,253 | 19 | 0.01 | % | ||||||||||||||
Interest-bearing demand | 1,295,409 | 608 | 0.19 | % | 983,936 | 192 | 0.08 | % | ||||||||||||||
Money market accounts | 2,755,714 | 1,385 | 0.20 | % | 1,997,585 | 602 | 0.12 | % | ||||||||||||||
Total interest-bearing deposits | 5,390,869 | 2,572 | 0.19 | % | 4,123,135 | 908 | 0.09 | % | ||||||||||||||
FHLB advances | 156,512 | 815 | 2.08 | % | 195,369 | 591 | 1.21 | % | ||||||||||||||
Subordinated debentures | 35,577 | 468 | 5.26 | % | — | — | — | % | ||||||||||||||
Other borrowings | 28,097 | 20 | 0.28 | % | 48,712 | 126 | 1.03 | % | ||||||||||||||
Total interest-bearing liabilities | 5,611,055 | $ | 3,875 | 0.28 | % | 4,367,216 | $ | 1,625 | 0.15 | % | ||||||||||||
Noninterest-bearing deposits | 4,873,953 | 3,842,733 | ||||||||||||||||||||
Other noninterest-bearing liabilities | 89,980 | 91,761 | ||||||||||||||||||||
Shareholders’ equity | 1,954,552 | 1,295,564 | ||||||||||||||||||||
Total liabilities & shareholders’ equity | $ | 12,529,540 | $ | 9,597,274 | ||||||||||||||||||
Net interest income (tax equivalent) | $ | 118,602 | $ | 89,075 | ||||||||||||||||||
Net interest margin (tax equivalent) | 4.29 | % | 4.12 | % |
(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 $2.1 million and $1.8 million for the three month periods ended June 30, 2018 and June 30, 2017, respectively. The incremental accretion on acquired loans was $3.0 million and $3.1 million for the three months ended June 30, 2018 and 2017, respectively. |
(2) | Tax-exempt income is calculated on a tax equivalent basis at a rate of 21% for 2018 and 35% for 2017. The tax equivalent yield adjustment to interest earned on loans was $1.1 million and $1.5 million for the three months ended June 30, 2018 and 2017, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $814 thousand and $1.5 million for the three month periods ended June 30, 2018 and 2017, respectively. |
AVERAGE BALANCES AND RATES | ||||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||
June 30, 2018 | March 31, 2018 | |||||||||||||||||||||
Average Balances | Interest Earned / Paid | Average Rate | Average Balances | Interest Earned / Paid | Average Rate | |||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||
Loans, net (1)(2) | $ | 8,389,230 | $ | 106,526 | 5.08 | % | $ | 8,348,740 | $ | 104,091 | 4.99 | % | ||||||||||
Taxable securities | 2,111,086 | 11,923 | 2.26 | % | 2,158,039 | 12,708 | 2.36 | % | ||||||||||||||
Tax exempt securities (2) | 517,206 | 3,877 | 3.00 | % | 524,211 | 3,878 | 2.96 | % | ||||||||||||||
Interest-earning deposits with banks | 35,285 | 151 | 1.71 | % | 91,763 | 345 | 1.50 | % | ||||||||||||||
Total interest-earning assets | 11,052,807 | $ | 122,477 | 4.43 | % | 11,122,753 | $ | 121,022 | 4.35 | % | ||||||||||||
Other earning assets | 221,141 | 218,126 | ||||||||||||||||||||
Noninterest-earning assets | 1,255,592 | 1,262,265 | ||||||||||||||||||||
Total assets | $ | 12,529,540 | $ | 12,603,144 | ||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||
Certificates of deposit | $ | 464,217 | $ | 549 | 0.47 | % | $ | 479,729 | $ | 526 | 0.44 | % | ||||||||||
Savings accounts | 875,529 | 30 | 0.01 | % | 878,170 | 41 | 0.02 | % | ||||||||||||||
Interest-bearing demand | 1,295,409 | 608 | 0.19 | % | 1,252,823 | 535 | 0.17 | % | ||||||||||||||
Money market accounts | 2,755,714 | 1,385 | 0.20 | % | 2,795,008 | 1,407 | 0.20 | % | ||||||||||||||
Total interest-bearing deposits | 5,390,869 | 2,572 | 0.19 | % | 5,405,730 | 2,509 | 0.19 | % | ||||||||||||||
FHLB advances | 156,512 | 815 | 2.08 | % | 125,660 | 570 | 1.81 | % | ||||||||||||||
Subordinated debentures | 35,577 | 468 | 5.26 | % | 35,623 | 468 | 5.26 | % | ||||||||||||||
Other borrowings | 28,097 | 20 | 0.28 | % | 60,840 | 116 | 0.76 | % | ||||||||||||||
Total interest-bearing liabilities | 5,611,055 | $ | 3,875 | 0.28 | % | 5,627,853 | $ | 3,663 | 0.26 | % | ||||||||||||
Noninterest-bearing deposits | 4,873,953 | 4,928,750 | ||||||||||||||||||||
Other noninterest-bearing liabilities | 89,980 | 97,266 | ||||||||||||||||||||
Shareholders’ equity | 1,954,552 | 1,949,275 | ||||||||||||||||||||
Total liabilities & shareholders’ equity | $ | 12,529,540 | $ | 12,603,144 | ||||||||||||||||||
Net interest income (tax equivalent) | $ | 118,602 | $ | 117,359 | ||||||||||||||||||
Net interest margin (tax equivalent) | 4.29 | % | 4.22 | % |
(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 $2.1 million and $2.2 million for the three month periods ended June 30, 2018 and March 31, 2018, respectively. The incremental accretion on acquired loans was $3.0 million and $3.7 million for the three months ended June 30, 2018 and March 31, 2018, respectively. |
(2) | Tax-exempt income is calculated on a tax equivalent basis at a rate of 21% for 2018. The tax equivalent yield adjustment to interest earned on loans was $1.1 million for both the three months ended June 30, 2018 and March 31, 2018. The tax equivalent yield adjustment to interest earned on tax exempt securities was $814 thousand for both the three month periods ended June 30, 2018 and March 31, 2018. |
AVERAGE BALANCES AND RATES | ||||||||||||||||||||||
Columbia Banking System, Inc. | ||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||
Six Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2018 | 2017 | |||||||||||||||||||||
Average Balances | Interest Earned / Paid | Average Rate | Average Balances | Interest Earned / Paid | Average Rate | |||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||
Loans, net (1)(2) | $ | 8,369,097 | $ | 210,617 | 5.03 | % | $ | 6,262,190 | $ | 152,544 | 4.87 | % | ||||||||||
Taxable securities | 2,134,433 | 24,631 | 2.31 | % | 1,861,762 | 20,454 | 2.20 | % | ||||||||||||||
Tax exempt securities (2) | 520,689 | 7,755 | 2.98 | % | 451,537 | 8,319 | 3.68 | % | ||||||||||||||
Interest-earning deposits with banks | 63,368 | 496 | 1.57 | % | 10,887 | 42 | 0.77 | % | ||||||||||||||
Total interest-earning assets | 11,087,587 | $ | 243,499 | 4.39 | % | 8,586,376 | $ | 181,359 | 4.22 | % | ||||||||||||
Other earning assets | 219,642 | 175,554 | ||||||||||||||||||||
Noninterest-earning assets | 1,258,909 | 773,897 | ||||||||||||||||||||
Total assets | $ | 12,566,138 | $ | 9,535,827 | ||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||
Certificates of deposit | $ | 471,930 | $ | 1,075 | 0.46 | % | $ | 392,798 | $ | 190 | 0.10 | % | ||||||||||
Savings accounts | 876,842 | 71 | 0.02 | % | 746,988 | 38 | 0.01 | % | ||||||||||||||
Interest-bearing demand | 1,274,234 | 1,143 | 0.18 | % | 978,279 | 351 | 0.07 | % | ||||||||||||||
Money market accounts | 2,775,253 | 2,792 | 0.20 | % | 2,002,817 | 1,116 | 0.11 | % | ||||||||||||||
Total interest-bearing deposits | 5,398,259 | 5,081 | 0.19 | % | 4,120,882 | 1,695 | 0.08 | % | ||||||||||||||
FHLB advances | 141,171 | 1,385 | 1.96 | % | 138,787 | 816 | 1.18 | % | ||||||||||||||
Subordinated debentures | 35,600 | 936 | 5.26 | % | — | — | — | % | ||||||||||||||
Other borrowings | 44,378 | 136 | 0.61 | % | 56,055 | 255 | 0.91 | % | ||||||||||||||
Total interest-bearing liabilities | 5,619,408 | $ | 7,538 | 0.27 | % | 4,315,724 | $ | 2,766 | 0.13 | % | ||||||||||||
Noninterest-bearing deposits | 4,901,200 | 3,839,410 | ||||||||||||||||||||
Other noninterest-bearing liabilities | 93,602 | 101,991 | ||||||||||||||||||||
Shareholders’ equity | 1,951,928 | 1,278,702 | ||||||||||||||||||||
Total liabilities & shareholders’ equity | $ | 12,566,138 | $ | 9,535,827 | ||||||||||||||||||
Net interest income (tax equivalent) | $ | 235,961 | $ | 178,593 | ||||||||||||||||||
Net interest margin (tax equivalent) | 4.26 | % | 4.16 | % |
(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 $4.3 million and $3.4 million for the six months ended June 30, 2018 and 2017, respectively. The incremental accretion on acquired loans was $6.7 million and $7.2 million for the six months ended June 30, 2018 and 2017, respectively. |
(2) | Tax-exempt income is calculated on a tax equivalent basis at a rate of 21% for 2018 and 35% for 2017. The tax equivalent yield adjustment to interest earned on loans was $2.2 million and $2.8 million for the six months ended June 30, 2018 and 2017, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $1.6 million and $2.9 million for the six months ended June 30, 2018 and 2017, respectively. |
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | ||||||||||||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Operating net interest margin non-GAAP reconciliation: | (dollars in thousands) | |||||||||||||||||||
Net interest income (tax equivalent) (1) | $ | 118,602 | $ | 117,359 | $ | 89,075 | $ | 235,961 | $ | 178,593 | ||||||||||
Adjustments to arrive at operating net interest income (tax equivalent): | ||||||||||||||||||||
Incremental accretion income on FDIC purchased credit impaired loans | (326 | ) | (329 | ) | (753 | ) | (655 | ) | (2,870 | ) | ||||||||||
Incremental accretion income on other acquired loans | (2,690 | ) | (3,370 | ) | (2,356 | ) | (6,060 | ) | (4,304 | ) | ||||||||||
Premium amortization on acquired securities | 2,131 | 2,075 | 1,669 | 4,206 | 3,131 | |||||||||||||||
Interest reversals on nonaccrual loans | 253 | 417 | 747 | 670 | 1,012 | |||||||||||||||
Operating net interest income (tax equivalent) (1) | $ | 117,970 | $ | 116,152 | $ | 88,382 | $ | 234,122 | $ | 175,562 | ||||||||||
Average interest earning assets | $ | 11,052,807 | $ | 11,122,753 | $ | 8,651,735 | $ | 11,087,587 | $ | 8,586,376 | ||||||||||
Net interest margin (tax equivalent) (1) | 4.29 | % | 4.22 | % | 4.12 | % | 4.26 | % | 4.16 | % | ||||||||||
Operating net interest margin (tax equivalent) (1) | 4.27 | % | 4.18 | % | 4.09 | % | 4.22 | % | 4.09 | % |
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | ||||||||||||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Operating efficiency ratio non-GAAP reconciliation: | (dollars in thousands) | |||||||||||||||||||
Noninterest expense (numerator A) | $ | 84,643 | $ | 85,987 | $ | 68,867 | $ | 170,630 | $ | 137,853 | ||||||||||
Adjustments to arrive at operating noninterest expense: | ||||||||||||||||||||
Acquisition-related expenses | (2,822 | ) | (4,265 | ) | (1,023 | ) | (7,087 | ) | (2,387 | ) | ||||||||||
Net benefit (cost) of operation of OREO and OPPO | (758 | ) | 4 | 1 | (754 | ) | (149 | ) | ||||||||||||
FDIC clawback liability recovery | — | — | — | — | 54 | |||||||||||||||
Loss on asset disposals | (1 | ) | — | (8 | ) | (1 | ) | (14 | ) | |||||||||||
Termination of FDIC loss share agreements charge | — | — | (2,409 | ) | — | (2,409 | ) | |||||||||||||
State of Washington Business and Occupation ("B&O") taxes | (1,459 | ) | (1,317 | ) | (642 | ) | (2,776 | ) | (1,765 | ) | ||||||||||
Operating noninterest expense (numerator B) | $ | 79,603 | $ | 80,409 | $ | 64,786 | $ | 160,012 | $ | 131,183 | ||||||||||
Net interest income (tax equivalent) (1) | $ | 118,602 | $ | 117,359 | $ | 89,075 | $ | 235,961 | $ | 178,593 | ||||||||||
Noninterest income | 23,692 | 23,143 | 24,135 | 46,835 | 48,994 | |||||||||||||||
Bank owned life insurance tax equivalent adjustment | 455 | 379 | 772 | 834 | 1,461 | |||||||||||||||
Total revenue (tax equivalent) (denominator A) | $ | 142,749 | $ | 140,881 | $ | 113,982 | $ | 283,630 | $ | 229,048 | ||||||||||
Operating net interest income (tax equivalent) (1) | $ | 117,970 | $ | 116,152 | $ | 88,382 | $ | 234,122 | $ | 175,562 | ||||||||||
Adjustments to arrive at operating noninterest income (tax equivalent): | ||||||||||||||||||||
Investment securities gains (loss), net | 33 | (22 | ) | — | 11 | — | ||||||||||||||
Gain on asset disposals | (47 | ) | (35 | ) | (256 | ) | (82 | ) | (285 | ) | ||||||||||
Mortgage loan repurchase liability adjustment | — | — | — | — | (573 | ) | ||||||||||||||
Change in FDIC loss-sharing asset | — | — | 173 | — | 447 | |||||||||||||||
Operating noninterest income (tax equivalent) | 24,133 | 23,465 | 24,824 | 47,598 | 50,044 | |||||||||||||||
Total operating revenue (tax equivalent) (denominator B) | $ | 142,103 | $ | 139,617 | $ | 113,206 | $ | 281,720 | $ | 225,606 | ||||||||||
Efficiency ratio (tax equivalent) (numerator A/denominator A) | 59.29 | % | 61.04 | % | 60.42 | % | 60.16 | % | 60.19 | % | ||||||||||
Operating efficiency ratio (tax equivalent) (numerator B/denominator B) | 56.02 | % | 57.59 | % | 57.23 | % | 56.80 | % | 58.15 | % |
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | ||||||||||||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Core noninterest expense ratio non-GAAP reconciliation: | (dollars in thousands) | |||||||||||||||||||
Noninterest expense (numerator A) | $ | 84,643 | $ | 85,987 | $ | 68,867 | $ | 170,630 | $ | 137,853 | ||||||||||
Adjustments to arrive at core noninterest expense: | ||||||||||||||||||||
FDIC clawback liability recovery | — | — | — | — | 54 | |||||||||||||||
Acquisition-related expenses | (2,822 | ) | (4,265 | ) | (1,023 | ) | (7,087 | ) | (2,387 | ) | ||||||||||
Net benefit (cost) of operation of OREO and OPPO (3) | — | — | 1 | — | (149 | ) | ||||||||||||||
Termination of FDIC loss share agreements charge | — | — | (2,409 | ) | — | (2,409 | ) | |||||||||||||
Core noninterest expense (numerator B) | $ | 81,821 | $ | 81,722 | $ | 65,436 | $ | 163,543 | $ | 132,962 | ||||||||||
Average assets (denominator) | $ | 12,529,540 | $ | 12,603,144 | $ | 9,597,274 | $ | 12,566,138 | $ | 9,535,827 | ||||||||||
Noninterest expense ratio (numerator A/denominator) (1) | 2.70 | % | 2.73 | % | 2.87 | % | 2.72 | % | 2.89 | % | ||||||||||
Core noninterest expense ratio (numerator B/denominator) (2) | 2.61 | % | 2.59 | % | 2.73 | % | 2.60 | % | 2.79 | % |
June 30, | March 31, | December 31, | ||||||||||
2018 | 2018 | 2017 | ||||||||||
Tangible common equity ratio and tangible book value per common share non-GAAP reconciliation: | (dollars in thousands) | |||||||||||
Shareholders' equity (numerator A) | $ | 1,964,881 | $ | 1,947,923 | $ | 1,949,922 | ||||||
Adjustments to arrive at tangible common equity: | ||||||||||||
Goodwill | (765,842 | ) | (765,842 | ) | (765,842 | ) | ||||||
Other intangible assets, net | (51,897 | ) | (54,985 | ) | (58,173 | ) | ||||||
Tangible common equity (numerator B) | $ | 1,147,142 | $ | 1,127,096 | $ | 1,125,907 | ||||||
Total assets (denominator A) | $ | 12,628,586 | $ | 12,530,636 | $ | 12,716,886 | ||||||
Adjustments to arrive at tangible assets: | ||||||||||||
Goodwill | (765,842 | ) | (765,842 | ) | (765,842 | ) | ||||||
Other intangible assets, net | (51,897 | ) | (54,985 | ) | (58,173 | ) | ||||||
Tangible assets (denominator B) | $ | 11,810,847 | $ | 11,709,809 | $ | 11,892,871 | ||||||
Shareholders' equity to total assets (numerator A/denominator A) | 15.56 | % | 15.55 | % | 15.33 | % | ||||||
Tangible common shareholders' equity to tangible assets (numerator B/denominator B) | 9.71 | % | 9.63 | % | 9.47 | % | ||||||
Common shares outstanding (denominator C) | 73,245 | 73,240 | 73,020 | |||||||||
Book value per common share (numerator A/denominator C) | $ | 26.83 | $ | 26.60 | $ | 26.70 | ||||||
Tangible book value per common share (numerator B/denominator C) | $ | 15.66 | $ | 15.39 | $ | 15.42 |
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | ||||||||||||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Return on average tangible common equity non-GAAP reconciliation: | (dollars in thousands) | |||||||||||||||||||
Net income (numerator A) | $ | 41,749 | $ | 39,970 | $ | 27,132 | $ | 81,719 | $ | 56,331 | ||||||||||
Adjustments to arrive at tangible income applicable to common shareholders: | ||||||||||||||||||||
Amortization of intangibles | 3,088 | 3,188 | 1,249 | 6,276 | 2,598 | |||||||||||||||
Tax effect on intangible amortization | (649 | ) | (669 | ) | (437 | ) | (1,318 | ) | (909 | ) | ||||||||||
Tangible income applicable to common shareholders (numerator B) | $ | 44,188 | $ | 42,489 | $ | 27,944 | 86,677 | $ | 58,020 | |||||||||||
Average shareholders' equity (denominator A) | $ | 1,954,552 | $ | 1,949,275 | $ | 1,295,564 | 1,951,928 | $ | 1,278,702 | |||||||||||
Adjustments to arrive at average tangible common equity: | ||||||||||||||||||||
Average preferred equity | — | — | — | — | (135 | ) | ||||||||||||||
Average intangibles | (819,211 | ) | (822,376 | ) | (398,385 | ) | (820,785 | ) | (399,025 | ) | ||||||||||
Average tangible common equity (denominator B) | $ | 1,135,341 | $ | 1,126,899 | $ | 897,179 | $ | 1,131,143 | $ | 879,542 | ||||||||||
Return on average common equity (numerator A/denominator A) (1) | 8.54 | % | 8.20 | % | 8.38 | % | 8.37 | % | 8.81 | % | ||||||||||
Return on average tangible common equity (numerator B/denominator B) (2) | 15.57 | % | 15.08 | % | 12.46 | % | 15.33 | % | 13.19 | % |
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