EX-99.1 2 umpq-20190630ex991earnings.htm PRESS RELEASE ANNOUNCING SECOND QUARTER 2019 FINANCIAL RESULTS Exhibit

EXHIBIT 99.1 
umpqheader.jpg  


Contacts:
Ron Farnsworth
Drew Anderson
EVP/Chief Financial Officer
SVP/Investor Relations Director
Umpqua Holdings Corporation
Umpqua Holdings Corporation
503-727-4108
503-727-4192
ronfarnsworth@umpquabank.com
drewanderson@umpquabank.com
 
UMPQUA REPORTS SECOND QUARTER 2019 RESULTS

Second quarter 2019 net income of $111.8 million, or $0.51 per common share
Deposit growth of $575.1 million, or 10.8% annualized
Loan and lease growth of $547.4 million, or 10.7% annualized
Gain on sale of Visa Class B stock of $81.9 million, offsetting MSR fair value loss of $24.7 million


PORTLAND, Ore. – July 17, 2019 – Umpqua Holdings Corporation (NASDAQ: UMPQ) (the “Company”) reported net income of $111.8 million for the second quarter of 2019, compared to $74.0 million for the first quarter of 2019 and $66.0 million for the second quarter of 2018. Earnings per diluted common share were $0.51 for the second quarter of 2019, compared to $0.34 for the first quarter of 2019 and $0.30 for the second quarter of 2018.

“Umpqua's strong deposit growth of $575 million and loan and lease growth of $547 million demonstrate our focus on the growth initiatives within our Next Gen strategy.” said Cort O'Haver, president and CEO of Umpqua Holdings Corporation. “Last quarter we made several strategic moves to enhance the Company’s long-term profitability. These included an opportunistic sale of our Visa Class B shares, which generated proceeds to strategically re-balance our securities portfolio and continue to invest in efficient, revenue-generating businesses. We’ve also begun the process of selling material portions of our mortgage servicing rights portfolio to reduce volatility and expect the sale of the first tranche to close in the fourth quarter. We also continue to innovate and invest in our human digital banking experience and are pleased with the early results and strong customer response to our Go-To app, which launched in April.”

Notable items that impacted the second quarter 2019 financial results included:

•
$81.9 million gain on sale for all shares of Visa Class B stock held by the Company, partially offset by a $7.2 million loss on debt securities.
•
$24.7 million loss on fair value change of the MSR asset attributable to the decrease in long-term interest rates during the quarter, compared to a $14.0 million loss in the prior quarter and a $5.4 million loss in the same period of the prior year.
•
$4.0 million loss related to the fair value of the debt capital market swap derivatives attributable to the decrease in long-term interest rates during the quarter, compared to a loss of $2.5 million in the prior quarter and a gain of $0.3 million in the same period of the prior year.
•
$1.5 million of exit and disposal costs, compared to $1.4 million in the prior quarter and $2.6 million in the same period of the prior year.


Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 2


Second Quarter 2019 Highlights (compared to prior quarter):

•
Net interest income decreased by $10.5 million on a quarter to quarter basis primarily driven by higher levels of bond premium amortization as the decrease in long-term rates during the second quarter resulted in higher prepayment speeds compared to the prior quarter;
•
Provision for loan and lease losses increased by $5.7 million, due to growth in the overall loan portfolio;
•
Net charge-offs decreased by one basis point to 0.26% of average loans and leases (annualized);
•
Non-interest income increased by $76.1 million, driven primary by the $81.9 million gain resulting from the sale of the Visa Class B stock and partially offset by a $7.2 million loss on debt securities;
•
Non-interest expense increased by $8.8 million, driven primarily by higher mortgage banking-related expenses, higher loss on OREO, higher marketing expenses, partially offset by a seasonal decrease in payroll taxes and lower group insurance charges;
•
Non-performing assets to total assets improved to 0.28% from 0.32%;
•
Estimated total risk-based capital ratio of 13.7% and estimated Tier 1 common to risk weighted assets ratio of 10.9%;
•
Declared a quarterly cash dividend of $0.21 per common share.

Balance Sheet
Total consolidated assets were $28.0 billion as of June 30, 2019, compared to $27.4 billion as of March 31, 2019 and $26.5 billion as of June 30, 2018. Including secured off-balance sheet lines of credit, total available liquidity was $10.5 billion as of June 30, 2019, representing 38% of total assets and 48% of total deposits.
 
Gross loans and leases were $21.0 billion as of June 30, 2019, an increase of $547.4 million relative to March 31, 2019. Strong loan production in the commercial loan category as well as residential real estate fueled the balance sheet growth.

Total deposits were $21.8 billion as of June 30, 2019, an increase of $575.1 million from $21.2 billion as of March 31, 2019. This increase was attributable to growth in non-interest bearing demand deposits of $275.5 million and money market deposit growth of $319.8 million.
 
Net Interest Income
Net interest income was $227.2 million for the second quarter of 2019, down $10.5 million from the prior quarter. This decrease was primarily attributable to taxable bond premium amortization of $10.4 million in the second quarter compared to $1.6 million in the first quarter of 2019.

The Company's net interest margin was 3.70% for the second quarter of 2019, down 33 basis points from 4.03% for the first quarter of 2019 primarily driven by the aforementioned higher levels of bond premium amortization and higher cost of interest bearing deposits compared to the prior quarter.

Credit Quality
The allowance for loan and lease losses was $151.1 million, or 0.72% of loans and leases, as of June 30, 2019, which was up from $144.9 million, or 0.71% of loans and leases, as of March 31, 2019. The provision for loan and lease losses was $19.4 million for the second quarter of 2019, an increase of $5.7 million from the prior quarter level, driven primarily by growth in the loan portfolio. Net charge-offs decreased by one basis point to 0.26% of average loans and leases (annualized). As of June 30, 2019, non-performing assets were 0.28% of total assets, compared to 0.32% as of March 31, 2019 and 0.34% as of June 30, 2018.

Non-interest Income
Non-interest income was $121.8 million for the second quarter of 2019, up $76.1 million from the prior quarter, reflecting the nonrecurring $81.9 million gain on sale of Visa Class B stock.


Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 3


Revenue from the origination and sale of residential mortgages was $23.2 million for the second quarter of 2019, an increase of $8.8 million from the prior quarter. This increase reflects a sequential quarter increase of 43% in for-sale mortgage origination volume and an increase of 37 basis points in the home lending gain on sale margin to 3.32% for the second quarter of 2019. Of the current quarter's mortgage production, 70% related to purchase activity, compared to 71% for the prior quarter and 81% for the same period of the prior year.

Non-interest Expense
Non-interest expense was $180.4 million for the second quarter of 2019, up $8.8 million from the prior quarter level. This increase was driven primarily by higher mortgage banking-related expenses, higher loss on OREO, and higher marketing expenses, partially offset by a seasonal decrease in payroll taxes and lower group insurance charges.

Capital
As of June 30, 2019, the Company's tangible book value per common share1 was $10.97, compared to $10.44 in the prior quarter and $9.84 in the same period of the prior year. During the second quarter of 2019, the Company declared a dividend of $0.21 per common share.

The Company's estimated total risk-based capital ratio was 13.7% and its estimated Tier 1 common to risk weighted
assets ratio was 10.9% as of June 30, 2019. The Company remains above current “well-capitalized” regulatory minimums. The regulatory capital ratios as of June 30, 2019 are estimates, pending completion and filing of the Company's regulatory reports.





1 "Non-GAAP" financial measure. More information regarding this measurement and a reconciliation to the comparable GAAP measurement is provided
under the heading Non-GAAP Financial Measures below.
Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 4


Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures. The Company believes that these non-GAAP financial measures provide investors with information useful in understanding the Company's financial performance; however, readers of this document are urged to review these non-GAAP financial measures in conjunction with the GAAP results as reported.

Management believes tangible common equity and the tangible common equity ratio are useful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which management believes will assist investors in assessing the capital of the Company and the ability to absorb potential losses. Tangible common equity is calculated as total shareholders' equity less goodwill and other intangible assets, net (excluding MSRs). Tangible assets are total assets less goodwill and other intangible assets, net (excluding MSRs).  The tangible common equity ratio is calculated as tangible common shareholders' equity divided by tangible assets.
 
The following table provides reconciliations of ending shareholders' equity (GAAP) to ending tangible common equity (non-GAAP), and ending assets (GAAP) to ending tangible assets (non-GAAP).
 
(In thousands, except per share data)
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
Total shareholders' equity
 
$
4,228,507

 
$
4,112,326

 
$
4,056,442

 
$
4,003,893

 
$
3,981,087

Subtract:
 
 

 
 

 
 
 
 
 
 

Goodwill
 
1,787,651

 
1,787,651

 
1,787,651

 
1,787,651

 
1,787,651

Other intangible assets, net
 
21,155

 
22,560

 
23,964

 
25,506

 
27,047

Tangible common shareholders' equity
 
$
2,419,701

 
$
2,302,115

 
$
2,244,827

 
$
2,190,736

 
$
2,166,389

Total assets
 
$
27,986,075

 
$
27,355,625

 
$
26,939,781

 
$
26,615,067

 
$
26,480,601

Subtract:
 
 

 
 

 
 
 
 
 
 

Goodwill
 
1,787,651

 
1,787,651

 
1,787,651

 
1,787,651

 
1,787,651

Other intangible assets, net
 
21,155

 
22,560

 
23,964

 
25,506

 
27,047

Tangible assets
 
$
26,177,269

 
$
25,545,414

 
$
25,128,166

 
$
24,801,910

 
$
24,665,903

Common shares outstanding at period end
 
220,499

 
220,457

 
220,255

 
220,238

 
220,205

 
 
 
 
 
 
 
 
 
 
 
Total shareholders' equity to total assets ratio
 
15.11
%
 
15.03
%
 
15.06
%
 
15.04
%
 
15.03
%
Tangible common equity ratio
 
9.24
%
 
9.01
%
 
8.93
%
 
8.83
%
 
8.78
%
Book value per common share
 
$
19.18

 
$
18.65

 
$
18.42

 
$
18.18

 
$
18.08

Tangible book value per common share
 
$
10.97

 
$
10.44

 
$
10.19

 
$
9.95

 
$
9.84



Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 5


About Umpqua Holdings Corporation
Umpqua Holdings Corporation (NASDAQ: UMPQ) is the parent company of Umpqua Bank, an Oregon-based community bank recognized for its entrepreneurial approach, innovative customer experience, and distinctive banking solutions. Umpqua Bank has locations across Oregon, Washington, California, Idaho and Nevada. Umpqua Holdings also owns a retail brokerage subsidiary, Umpqua Investments, Inc., which has locations in Umpqua Bank stores and in dedicated offices in Oregon. Umpqua Holdings Corporation is headquartered in Portland, Oregon. For more information, visit umpquabank.com.
 
Earnings Conference Call Information
The Company will host its second quarter 2019 earnings conference call on July 18, 2019, at 10:00 a.m. PT (1:00 p.m. ET). During the call, the Company will provide an update on recent activities and discuss its second quarter 2019 financial results. There will be a live question-and-answer session following the presentation. To join the call, please dial (800) 289-0459 ten minutes prior to the start time and enter conference ID: 942314. A re-broadcast will be available approximately two hours after the call by dialing (888) 203-1112 and entering conference ID 2627879. The earnings conference call will also be available as an audiocast, which can be accessed on the Company's investor relations page at umpquabank.com.
 
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of the “Safe-Harbor” provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the SEC. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements. In this press release we make forward-looking statements about strategic investments, fee income initiatives, sale of MSR and MSR fair value volatility. Risks that could cause results to differ from forward-looking statements we make are set forth in our filings with the SEC and include, without limitation, prolonged low interest rate environment; the effect of interest rate increases on the cost of deposits; unanticipated weakness in loan demand or loan pricing; deterioration in the economy; lack of strategic growth opportunities or our failure to execute on those opportunities; our ability to effectively manage problem credits; our ability to successfully implement efficiency and operational excellence initiatives on time and in amounts projected; our ability to successfully develop and market new products and technology; and changes in laws or regulations.

Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 6


Umpqua Holdings Corporation
Consolidated Statements of Income
(Unaudited)
 
 
Quarter Ended
 
% Change
(In thousands, except per share data)
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
Seq. Quarter
 
Year over Year
Interest income:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans and leases
 
$
264,110

 
$
258,747

 
$
254,093

 
$
246,410

 
$
242,123

 
2
 %
 
9
 %
Interest and dividends on investments:
 
 
 
 

 
 
 
 
 
 
 


 


Taxable
 
10,287

 
19,956

 
27,381

 
24,435

 
8,499

 
(48
)%
 
21
 %
Exempt from federal income tax
 
1,921

 
2,114

 
2,135

 
2,048

 
2,057

 
(9
)%
 
(7
)%
Dividends
 
574

 
517

 
538

 
549

 
433

 
11
 %
 
33
 %
Temporary investments and interest bearing deposits
 
4,708

 
925

 
2,621

 
2,800

 
2,080

 
409
 %
 
126
 %
Total interest income
 
281,600

 
282,259

 
286,768

 
276,242

 
255,192

 
0
 %
 
10
 %
Interest expense:
 
 

 
 

 
 

 
 

 
 

 


 


Deposits
 
43,591

 
34,094

 
30,124

 
25,692

 
21,259

 
28
 %
 
105
 %
Securities sold under agreement to repurchase and federal funds purchased
 
403

 
810

 
185

 
103

 
155

 
(50
)%
 
160
 %
Term debt
 
4,563

 
3,683

 
3,326

 
3,439

 
3,478

 
24
 %
 
31
 %
Junior subordinated debentures
 
5,881

 
5,987

 
5,743

 
5,640

 
5,400

 
(2
)%
 
9
 %
Total interest expense
 
54,438

 
44,574

 
39,378

 
34,874

 
30,292

 
22
 %
 
80
 %
Net interest income
 
227,162

 
237,685

 
247,390

 
241,368

 
224,900

 
(4
)%
 
1
 %
Provision for loan and lease losses
 
19,352

 
13,684

 
17,219

 
11,711

 
13,319

 
41
 %
 
45
 %
Non-interest income:
 
 

 
 

 
 

 
 

 
 

 


 


Service charges on deposits
 
15,953

 
15,278

 
16,035

 
15,574

 
15,520

 
4
 %
 
3
 %
Brokerage revenue
 
3,980

 
3,810

 
4,178

 
3,947

 
4,161

 
4
 %
 
(4
)%
Residential mortgage banking revenue, net
 
9,529

 
11,231

 
15,150

 
31,484

 
33,163

 
(15
)%
 
(71
)%
(Loss) gain on sale of debt securities, net
 
(7,186
)
 
—

 
—

 
—

 
14

 
nm

 
nm

Gain (loss) on equity securities, net
 
82,607

 
695

 
410

 
(462
)
 
(1,432
)
 
nm

 
nm

Gain on loan sales, net
 
3,333

 
769

 
2,484

 
2,772

 
1,348

 
333
 %
 
147
 %
BOLI income
 
2,093

 
2,168

 
2,116

 
2,051

 
2,060

 
(3
)%
 
2
 %
Other income
 
11,514

 
11,789

 
16,438

 
17,022

 
16,817

 
(2
)%
 
(32
)%
Total non-interest income
 
121,823

 
45,740

 
56,811

 
72,388

 
71,651

 
166
 %
 
70
 %
Non-interest expense:
 
 

 
 

 
 

 
 

 
 

 


 


Salaries and employee benefits
 
104,049

 
100,658

 
102,109

 
103,575

 
113,340

 
3
 %
 
(8
)%
Occupancy and equipment, net
 
36,032

 
36,245

 
35,949

 
36,530

 
37,584

 
(1
)%
 
(4
)%
Intangible amortization
 
1,405

 
1,404

 
1,542

 
1,541

 
1,542

 
0
 %
 
(9
)%
FDIC assessments
 
2,837

 
2,942

 
2,619

 
4,303

 
4,692

 
(4
)%
 
(40
)%
Loss (gain) on other real estate owned, net
 
2,678

 
(51
)
 
1,125

 
(128
)
 
(92
)
 
nm

 
nm

Other expenses
 
33,414

 
30,394

 
35,144

 
33,471

 
38,506

 
10
 %
 
(13
)%
Total non-interest expense
 
180,415

 
171,592

 
178,488

 
179,292

 
195,572

 
5
 %
 
(8
)%
Income before provision for income taxes
 
149,218

 
98,149

 
108,494

 
122,753

 
87,660

 
52
 %
 
70
 %
Provision for income taxes
 
37,408

 
24,116

 
28,183

 
31,772

 
21,661

 
55
 %
 
73
 %
Net income
 
$
111,810

 
$
74,033

 
$
80,311

 
$
90,981

 
$
65,999

 
51
 %
 
69
 %
 
 
 
 
 
 
 
 
 
 
 
 


 


Weighted average basic shares outstanding
 
220,487

 
220,366

 
220,247

 
220,224

 
220,283

 
0
 %
 
0
 %
Weighted average diluted shares outstanding
 
220,719

 
220,655

 
220,668

 
220,620

 
220,647

 
0
 %
 
0
 %
Earnings per common share – basic
 
$
0.51

 
$
0.34

 
$
0.36

 
$
0.41

 
$
0.30

 
50
 %
 
70
 %
Earnings per common share – diluted
 
$
0.51

 
$
0.34

 
$
0.36

 
$
0.41

 
$
0.30

 
50
 %
 
70
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
nm = not meaningful
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 7


Umpqua Holdings Corporation
Consolidated Statements of Income
(Unaudited)
 
 
Six Months Ended
 
% Change
(In thousands, except per share data)
 
Jun 30, 2019
 
Jun 30, 2018
 
Year over Year
Interest income:
 
 
 
 
 
 
Loans and leases
 
$
522,857

 
$
471,611

 
11
 %
Interest and dividends on investments:
 
 
 
 
 


Taxable
 
30,243

 
24,198

 
25
 %
Exempt from federal income tax
 
4,035

 
4,185

 
(4
)%
Dividends
 
1,091

 
901

 
21
 %
Temporary investments and interest bearing deposits
 
5,633

 
3,244

 
74
 %
Total interest income
 
563,859

 
504,139

 
12
 %
Interest expense:
 
 

 
 
 


Deposits
 
77,685

 
36,869

 
111
 %
Securities sold under agreement to repurchase and federal funds purchased
 
1,213

 
218

 
456
 %
Term debt
 
8,246

 
6,839

 
21
 %
Junior subordinated debentures
 
11,868

 
10,332

 
15
 %
Total interest expense
 
99,012

 
54,258

 
82
 %
Net interest income
 
464,847

 
449,881

 
3
 %
Provision for loan and lease losses
 
33,036

 
26,975

 
22
 %
Non-interest income:
 
 

 
 
 


Service charges on deposits
 
31,231

 
30,515

 
2
 %
Brokerage revenue
 
7,790

 
8,355

 
(7
)%
Residential mortgage banking revenue, net
 
20,760

 
71,601

 
(71
)%
(Loss) gain on sale of debt securities, net
 
(7,186
)
 
14

 
nm

Gain (loss) on equity securities, net
 
83,302

 
(1,432
)
 
nm

Gain on loan sales, net
 
4,102

 
2,578

 
59
 %
BOLI income
 
4,261

 
4,130

 
3
 %
Other income
 
23,303

 
34,457

 
(32
)%
Total non-interest income
 
167,563

 
150,218

 
12
 %
Non-interest expense:
 
 

 
 
 


Salaries and employee benefits
 
204,707

 
219,891

 
(7
)%
Occupancy and equipment, net
 
72,277

 
76,245

 
(5
)%
Intangible amortization
 
2,809

 
3,083

 
(9
)%
FDIC assessments
 
5,779

 
9,172

 
(37
)%
Loss (gain) on other real estate owned, net
 
2,627

 
(130
)
 
nm

Other expenses
 
63,808

 
73,424

 
(13
)%
Total non-interest expense
 
352,007

 
381,685

 
(8
)%
Income before provision for income taxes
 
247,367

 
191,439

 
29
 %
Provision for income taxes
 
61,524

 
46,468

 
32
 %
Net income
 
$
185,843

 
$
144,971

 
28
 %
 
 
 
 
 
 


Weighted average basic shares outstanding
 
220,427

 
220,326

 
0
 %
Weighted average diluted shares outstanding
 
220,692

 
220,760

 
0
 %
Earnings per common share – basic
 
$
0.84

 
$
0.66

 
27
 %
Earnings per common share – diluted
 
$
0.84

 
$
0.66

 
27
 %
 
 
 
 
 
 
 
nm = not meaningful
 
 

 
 

 
 


Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 8


Umpqua Holdings Corporation
Consolidated Balance Sheets
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
% Change
(In thousands, except per share data)
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
Seq. Quarter
 
Year over Year
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and due from banks
$
342,508

 
$
296,967

 
$
335,419

 
$
308,938

 
$
314,513

 
15
 %
 
9
 %
Interest bearing cash and temporary investments
691,283

 
605,841

 
287,218

 
570,321

 
488,499

 
14
 %
 
42
 %
Investment securities:
 

 
 

 
 

 
 

 
 

 


 


Equity and other, at fair value
66,358

 
63,327

 
61,841

 
62,454

 
64,297

 
5
 %
 
3
 %
Available for sale, at fair value
2,698,398

 
2,894,778

 
2,977,108

 
2,864,394

 
2,854,398

 
(7
)%
 
(5
)%
Held to maturity, at amortized cost
3,416

 
3,478

 
3,606

 
3,672

 
3,586

 
(2
)%
 
(5
)%
Loans held for sale, at fair value
356,645

 
240,302

 
166,461

 
289,537

 
432,642

 
48
 %
 
(18
)%
Loans and leases
20,953,371

 
20,405,997

 
20,422,666

 
19,854,033

 
19,639,494

 
3
 %
 
7
 %
Allowance for loan and lease losses
(151,069
)
 
(144,872
)
 
(144,871
)
 
(144,026
)
 
(144,556
)
 
4
 %
 
5
 %
Net loans and leases
20,802,302

 
20,261,125

 
20,277,795

 
19,710,007

 
19,494,938

 
3
 %
 
7
 %
Restricted equity securities
43,063

 
47,466

 
40,268

 
40,269

 
42,320

 
(9
)%
 
2
 %
Premises and equipment, net
210,285

 
217,595

 
227,423

 
237,456

 
245,954

 
(3
)%
 
(15
)%
Operating lease right-of-use assets
112,752

 
109,807

 
—

 
—

 
—

 
3
 %
 
nm

Goodwill
1,787,651

 
1,787,651

 
1,787,651

 
1,787,651

 
1,787,651

 
0
 %
 
0
 %
Other intangible assets, net
21,155

 
22,560

 
23,964

 
25,506

 
27,047

 
(6
)%
 
(22
)%
Residential mortgage servicing rights, at fair value
139,780

 
158,946

 
169,025

 
175,038

 
166,217

 
(12
)%
 
(16
)%
Other real estate owned
8,423

 
10,488

 
10,958

 
11,774

 
12,101

 
(20
)%
 
(30
)%
Bank owned life insurance
316,435

 
314,303

 
313,626

 
311,922

 
309,844

 
1
 %
 
2
 %
Other assets
385,621

 
320,991

 
257,418

 
216,128

 
236,594

 
20
 %
 
63
 %
Total assets
$
27,986,075

 
$
27,355,625

 
$
26,939,781

 
$
26,615,067

 
$
26,480,601

 
2
 %
 
6
 %
Liabilities:
 

 
 

 
 

 
 

 
 

 


 


Deposits
$
21,819,013

 
$
21,243,894

 
$
21,137,486

 
$
20,892,774

 
$
20,744,526

 
3
 %
 
5
 %
Securities sold under agreements to repurchase
308,052

 
288,944

 
297,151

 
286,975

 
273,666

 
7
 %
 
13
 %
Term debt
821,712

 
932,420

 
751,788

 
751,764

 
801,739

 
(12
)%
 
2
 %
Junior subordinated debentures, at fair value
277,028

 
294,121

 
300,870

 
282,846

 
280,669

 
(6
)%
 
(1
)%
Junior subordinated debentures, at amortized cost
88,610

 
88,667

 
88,724

 
88,781

 
88,838

 
0
 %
 
0
 %
Operating lease liabilities
121,742

 
118,520

 
—

 
—

 
—

 
3
 %
 
nm

Deferred tax liability, net
57,757

 
45,202

 
25,846

 
22,413

 
27,255

 
28
 %
 
112
 %
Other liabilities
263,654

 
231,531

 
281,474

 
285,621

 
282,821

 
14
 %
 
(7
)%
Total liabilities
23,757,568

 
23,243,299

 
22,883,339

 
22,611,174

 
22,499,514

 
2
 %
 
6
 %
Shareholders' equity:
 

 
 

 
 

 
 

 
 

 


 


Common stock
3,514,391

 
3,511,731

 
3,512,874

 
3,510,949

 
3,509,146

 
0
 %
 
0
 %
Retained earnings
695,003

 
629,877

 
602,482

 
568,619

 
524,031

 
10
 %
 
33
 %
Accumulated other comprehensive income (loss)
19,113

 
(29,282
)
 
(58,914
)
 
(75,675
)
 
(52,090
)
 
(165
)%
 
(137
)%
Total shareholders' equity
4,228,507

 
4,112,326

 
4,056,442

 
4,003,893

 
3,981,087

 
3
 %
 
6
 %
Total liabilities and shareholders' equity
$
27,986,075

 
$
27,355,625

 
$
26,939,781

 
$
26,615,067

 
$
26,480,601

 
2
 %
 
6
 %
 
 
 
 
 
 
 
 
 
 
 


 


Common shares outstanding at period end
220,499

 
220,457

 
220,255

 
220,238

 
220,205

 
0
 %
 
0
 %
Book value per common share
$
19.18

 
$
18.65

 
$
18.42

 
$
18.18

 
$
18.08

 
3
 %
 
6
 %
Tangible book value per common share
$
10.97

 
$
10.44

 
$
10.19

 
$
9.95

 
$
9.84

 
5
 %
 
11
 %
Tangible equity - common
$
2,419,701

 
$
2,302,115

 
$
2,244,827

 
$
2,190,736

 
$
2,166,389

 
5
 %
 
12
 %
Tangible common equity to tangible assets
9.24
%
 
9.01
%
 
8.93
%
 
8.83
%
 
8.78
%
 
0.23

 
0.46

nm = not meaningful
 
 
 
 
 
 
 
 
 
 
 
 
 

Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 9


Umpqua Holdings Corporation
Loan and Lease Portfolio
(Unaudited)
(Dollars in thousands)
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
% Change
 
 
Amount
 
Amount
 
Amount
 
Amount
 
Amount
 
Seq. Quarter
 
Year over Year
Loans and leases:
 
 

 
 

 
 

 
 
 
 
 
 

 
 

Commercial real estate:
 
 

 
 

 
 

 
 
 
 
 
 

 
 

Non-owner occupied term, net
 
$
3,537,084

 
$
3,476,972

 
$
3,573,065

 
$
3,527,357

 
$
3,518,982

 
2
 %
 
1
 %
Owner occupied term, net
 
2,396,674

 
2,449,648

 
2,480,371

 
2,474,845

 
2,473,734

 
(2
)%
 
(3
)%
Multifamily, net
 
3,341,547

 
3,302,936

 
3,304,763

 
3,225,538

 
3,185,923

 
1
 %
 
5
 %
Construction & development, net
 
732,932

 
686,107

 
736,254

 
646,684

 
568,562

 
7
 %
 
29
 %
Residential development, net
 
199,421

 
205,963

 
196,890

 
198,518

 
183,114

 
(3
)%
 
9
 %
Commercial:
 
 
 
 
 
 
 
 
 
 
 


 


Term, net
 
2,271,346

 
2,185,322

 
2,232,923

 
2,149,376

 
2,106,658

 
4
 %
 
8
 %
Lines of credit & other, net
 
1,280,587

 
1,229,092

 
1,169,525

 
1,133,508

 
1,152,853

 
4
 %
 
11
 %
Leases & equipment finance, net
 
1,449,579

 
1,378,686

 
1,330,155

 
1,282,128

 
1,265,843

 
5
 %
 
15
 %
Residential:
 
 
 
 
 
 
 
 
 
 
 


 


Mortgage, net
 
3,995,643

 
3,768,955

 
3,635,073

 
3,468,569

 
3,405,775

 
6
 %
 
17
 %
Home equity loans & lines, net
 
1,215,215

 
1,170,252

 
1,176,477

 
1,143,351

 
1,132,329

 
4
 %
 
7
 %
   Consumer & other, net
 
533,343

 
552,064

 
587,170

 
604,159

 
645,721

 
(3
)%
 
(17
)%
Total loans, net of deferred fees and costs
 
$
20,953,371

 
$
20,405,997

 
$
20,422,666

 
$
19,854,033

 
$
19,639,494

 
3
 %
 
7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loan and leases mix:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Non-owner occupied term, net
 
17
%
 
17
%
 
17
%
 
18
%
 
18
%
 
 
 
 
   Owner occupied term, net
 
11
%
 
12
%
 
12
%
 
13
%
 
13
%
 
 
 
 
   Multifamily, net
 
16
%
 
16
%
 
16
%
 
16
%
 
16
%
 
 
 
 
Construction & development, net
 
3
%
 
3
%
 
4
%
 
3
%
 
3
%
 
 
 
 
Residential development, net
 
1
%
 
1
%
 
1
%
 
1
%
 
1
%
 
 
 
 
Commercial:
 
 

 
 
 


 


 


 
 
 
 
Term, net
 
11
%
 
11
%
 
11
%
 
11
%
 
11
%
 
 
 
 
Lines of credit & other, net
 
6
%
 
6
%
 
6
%
 
6
%
 
6
%
 
 
 
 
Leases & equipment finance, net
 
7
%
 
7
%
 
6
%
 
6
%
 
6
%
 
 
 
 
Residential:
 
 

 


 


 


 


 
 
 
 
Mortgage, net
 
19
%
 
18
%
 
18
%
 
17
%
 
17
%
 
 
 
 
Home equity loans & lines, net
 
6
%
 
6
%
 
6
%
 
6
%
 
6
%
 
 
 
 
   Consumer & other, net
 
3
%
 
3
%
 
3
%
 
3
%
 
3
%
 
 
 
 
Total
 
100
%
 
100
%
 
100
%
 
100
%
 
100
%
 
 
 
 



Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 10


Umpqua Holdings Corporation
Deposits by Type/Core Deposits
(Unaudited)
(Dollars in thousands)
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
% Change
 
 
Amount
 
Amount
 
Amount
 
Amount
 
Amount
 
Seq. Quarter
 
Year over Year
Deposits:
 
 

 
 

 
 

 
 
 
 
 
 

 
 

Demand, non-interest bearing
 
$
6,771,087

 
$
6,495,562

 
$
6,667,467

 
$
6,859,411

 
$
6,819,325

 
4
 %
 
(1
)%
Demand, interest bearing
 
2,355,473

 
2,341,441

 
2,340,471

 
2,320,560

 
2,321,691

 
1
 %
 
1
 %
Money market
 
6,789,036

 
6,469,286

 
6,645,390

 
6,325,808

 
6,161,907

 
5
 %
 
10
 %
Savings
 
1,446,332

 
1,479,509

 
1,492,685

 
1,499,872

 
1,465,154

 
(2
)%
 
(1
)%
Time
 
4,457,085

 
4,458,096

 
3,991,473

 
3,887,123

 
3,976,449

 
0
 %
 
12
 %
Total
 
$
21,819,013

 
$
21,243,894

 
$
21,137,486

 
$
20,892,774

 
$
20,744,526

 
3
 %
 
5
 %
 
 
 
 
 
 
 
 
 
 
 
 


 


Total core deposits (1)
 
$
18,529,797

 
$
17,903,754

 
$
18,190,402

 
$
18,012,992

 
$
17,743,888

 
3
 %
 
4
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deposit mix:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Demand, non-interest bearing
 
31
%
 
31
%
 
32
%
 
33
%
 
33
%
 
 
 
 
Demand, interest bearing
 
11
%
 
11
%
 
11
%
 
11
%
 
11
%
 
 
 
 
Money market
 
31
%
 
30
%
 
31
%
 
30
%
 
30
%
 
 
 
 
Savings
 
7
%
 
7
%
 
7
%
 
7
%
 
7
%
 
 
 
 
Time
 
20
%
 
21
%
 
19
%
 
19
%
 
19
%
 
 
 
 
Total
 
100
%
 
100
%
 
100
%
 
100
%
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of open accounts:
 
 

 
 

 
 

 
 
 
 

 
 

 
 

Demand, non-interest bearing
 
409,235

 
406,039

 
406,240

 
404,913

 
402,771

 


 


Demand, interest bearing
 
76,686

 
76,712

 
77,099

 
77,546

 
77,918

 


 


Money market
 
58,158

 
56,602

 
56,196

 
55,895

 
55,393

 


 


Savings
 
160,708

 
161,039

 
161,656

 
162,387

 
162,414

 


 


Time
 
60,571

 
58,210

 
54,388

 
52,482

 
51,073

 


 


Total
 
765,358

 
758,602

 
755,579

 
753,223

 
749,569

 


 


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Average balance per account:
 
 

 
 

 
 

 
 
 
 

 
 

 
 

Demand, non-interest bearing
 
$
16.5

 
$
16.0

 
$
16.4

 
$
16.9

 
$
16.9

 
 

 
 

Demand, interest bearing
 
30.7

 
30.5

 
30.4

 
29.9

 
29.8

 
 

 
 

Money market
 
116.7

 
114.3

 
118.3

 
113.2

 
111.2

 
 

 
 

Savings
 
9.0

 
9.2

 
9.2

 
9.2

 
9.0

 
 

 
 

Time
 
73.6

 
76.6

 
73.4

 
74.1

 
77.9

 
 

 
 

Total
 
$
28.5

 
$
28.0

 
$
28.0

 
$
27.7

 
$
27.7

 
 

 
 

 
(1) Core deposits are defined as total deposits less time deposits greater than $100,000.



Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 11


 
Umpqua Holdings Corporation
Credit Quality – Non-performing Assets
 (Unaudited)
 
 
Quarter Ended
 
% Change
(Dollars in thousands)
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
Seq. Quarter
 
Year over Year
Non-performing assets:
 
 

 
 

 
 
 
 
 
 

 
 

 
 

Loans and leases on non-accrual status
 
$
35,022

 
$
44,586

 
$
50,823

 
$
54,059

 
$
43,392

 
(21
)%
 
(19
)%
Loans and leases past due 90+ days and accruing (1)
 
35,700

 
31,424

 
36,444

 
33,812

 
34,535

 
14
 %
 
3
 %
Total non-performing loans and leases
 
70,722

 
76,010

 
87,267

 
87,871

 
77,927

 
(7
)%
 
(9
)%
Other real estate owned
 
8,423

 
10,488

 
10,958

 
11,774

 
12,101

 
(20
)%
 
(30
)%
Total non-performing assets
 
$
79,145

 
$
86,498

 
$
98,225

 
$
99,645

 
$
90,028

 
(9
)%
 
(12
)%
 
 
 
 
 
 
 
 
 
 
 
 


 


Performing restructured loans and leases
 
$
15,267

 
$
15,726

 
$
13,924

 
$
14,531

 
$
27,167

 
(3
)%
 
(44
)%
Loans and leases past due 31-89 days
 
$
40,619

 
$
53,009

 
$
37,373

 
$
33,825

 
$
44,734

 
(23
)%
 
(9
)%
Loans and leases past due 31-89 days to total loans and leases
 
0.19
%
 
0.26
%
 
0.18
%
 
0.17
%
 
0.23
%
 
 

 
 

Non-performing loans and leases to total loans and leases (1)
 
0.34
%
 
0.37
%
 
0.43
%
 
0.44
%
 
0.40
%
 
 

 
 

Non-performing assets to total assets(1)
 
0.28
%
 
0.32
%
 
0.36
%
 
0.37
%
 
0.34
%
 
 

 
 


(1) 
Excludes non-performing mortgage loans guaranteed by Ginnie Mae, which Umpqua has the unilateral right to repurchase but has not done so, totaling $5.4 million, $158,000, $8.9 million, $8.0 million, and $9.2 million at June 30, 2019, March 31, 2019, December 31, 2018, September 30, 2018, and June 30, 2018, respectively.
 

Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 12


Umpqua Holdings Corporation
Credit Quality – Allowance for Loan and Lease Losses
 (Unaudited)
 
 
Quarter Ended
 
% Change
(Dollars in thousands)
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
Seq. Quarter
 
Year over Year
Allowance for loan and lease losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance beginning of period
 
$
144,872

 
$
144,871

 
$
144,026

 
$
144,556

 
$
141,933

 
 
 
 
Provision for loan and lease losses
 
19,352

 
13,684

 
17,219

 
11,711

 
13,319

 
41
 %
 
45
 %
Charge-offs
 
(16,707
)
 
(17,152
)
 
(19,527
)
 
(15,896
)
 
(14,815
)
 
(3
)%
 
13
 %
Recoveries
 
3,552

 
3,469

 
3,153

 
3,655

 
4,119

 
2
 %
 
(14
)%
Net charge-offs
 
(13,155
)
 
(13,683
)
 
(16,374
)
 
(12,241
)
 
(10,696
)
 
(4
)%
 
23
 %
Total allowance for loan and lease losses
 
151,069

 
144,872

 
144,871

 
144,026

 
144,556

 
4
 %
 
5
 %
Reserve for unfunded commitments
 
4,857

 
4,654

 
4,523

 
4,294

 
4,130

 
4
 %
 
18
 %
Total allowance for credit losses
 
$
155,926

 
$
149,526

 
$
149,394

 
$
148,320

 
$
148,686

 
4
 %
 
5
 %
 
 
 

 
 

 
 
 
 
 
 

 
 

 
 

Net charge-offs to average loans and leases (annualized)
 
0.26
%
 
0.27
%
 
0.32
%
 
0.25
%
 
0.22
%
 
 

 
 

Recoveries to gross charge-offs
 
21.26
%
 
20.23
%
 
16.15
%
 
22.99
%
 
27.80
%
 
 
 
 

Allowance for loan and lease losses to loans and leases
 
0.72
%
 
0.71
%
 
0.71
%
 
0.73
%
 
0.74
%
 
 

 
 

Allowance for credit losses to loans and leases
 
0.74
%
 
0.73
%
 
0.73
%
 
0.75
%
 
0.76
%
 
 

 
 


Umpqua Holdings Corporation
Credit Quality – Allowance for Loan and Lease Losses
(Unaudited)
 
 
Six Months Ended
 
% Change
(Dollars in thousands)
 
Jun 30, 2019
 
Jun 30, 2018
 
Year over Year
Allowance for loan and lease losses:
 
 
 
 
Balance beginning of period
 
$
144,871

 
$
140,608

 
 
Provision for loan and lease losses
 
33,036

 
26,975

 
22
 %
Charge-offs
 
(33,859
)
 
(30,627
)
 
11
 %
Recoveries
 
7,021

 
7,600

 
(8
)%
Net charge-offs
 
(26,838
)
 
(23,027
)
 
17
 %
Total allowance for loan and lease losses
 
151,069

 
144,556

 
5
 %
Reserve for unfunded commitments
 
4,857

 
4,130

 
18
 %
Total allowance for credit losses
 
$
155,926

 
$
148,686

 
5
 %
 
 
 

 
 

 
 
Net charge-offs to average loans and leases (annualized)
 
0.26
%
 
0.24
%
 
 
Recoveries to gross charge-offs
 
20.74
%
 
24.81
%
 
 




Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 13


Umpqua Holdings Corporation
Selected Ratios
(Unaudited)
 
 
Quarter Ended
 
% Change
 
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
Seq. Quarter
 
Year over Year
Average Rates:
 
 

 
 

 
 

 
 
 
 

 
 
 
 
Yield on loans held for sale
 
5.03
%
 
5.95
%
 
5.81
%
 
5.27
%
 
4.86
%
 
(0.92
)
 
0.17

Yield on loans and leases
 
5.07
%
 
5.06
%
 
4.97
%
 
4.89
%
 
4.91
%
 
0.01

 
0.16

Yield on taxable investments
 
1.62
%
 
2.96
%
 
4.11
%
 
3.72
%
 
1.31
%
 
(1.34
)
 
0.31

Yield on tax-exempt investments (1)
 
3.42
%
 
3.59
%
 
3.70
%
 
3.61
%
 
3.64
%
 
(0.17
)
 
(0.22
)
Yield on interest bearing cash and temporary investments
 
2.41
%
 
2.44
%
 
2.25
%
 
1.99
%
 
1.82
%
 
(0.03
)
 
0.59

Total yield on earning assets (1)
 
4.59
%
 
4.79
%
 
4.81
%
 
4.67
%
 
4.41
%
 
(0.20
)
 
0.18

 
 
 
 
 
 
 
 
 
 
 
 


 


Cost of interest bearing deposits
 
1.16
%
 
0.97
%
 
0.85
%
 
0.73
%
 
0.62
%
 
0.19

 
0.54

Cost of securities sold under agreements
 
 

 
 

 
 

 
 
 
 
 


 


to repurchase and fed funds purchased
 
0.55
%
 
0.88
%
 
0.26
%
 
0.15
%
 
0.22
%
 
(0.33
)
 
0.33

Cost of term debt
 
2.03
%
 
1.88
%
 
1.75
%
 
1.73
%
 
1.74
%
 
0.15

 
0.29

Cost of junior subordinated debentures
 
6.17
%
 
6.24
%
 
6.13
%
 
6.06
%
 
5.89
%
 
(0.07
)
 
0.28

Total cost of interest bearing liabilities
 
1.31
%
 
1.14
%
 
1.00
%
 
0.90
%
 
0.80
%
 
0.17

 
0.51

 
 
 
 
 
 
 
 
 
 
 
 


 


Net interest spread (1)
 
3.28
%
 
3.65
%
 
3.81
%
 
3.77
%
 
3.61
%
 
(0.37
)
 
(0.33
)
Net interest margin (1)
 
3.70
%
 
4.03
%
 
4.15
%
 
4.09
%
 
3.89
%
 
(0.33
)
 
(0.19
)
 
 
 
 
 
 
 
 
 
 
 
 


 


Performance Ratios:
 
 

 
 

 
 

 
 
 
 
 


 


Return on average assets
 
1.62
%
 
1.12
%
 
1.19
%
 
1.36
%
 
1.02
%
 
0.50

 
0.60

Return on average tangible assets
 
1.73
%
 
1.20
%
 
1.28
%
 
1.46
%
 
1.09
%
 
0.53

 
0.64

Return on average common equity
 
10.80
%
 
7.34
%
 
7.90
%
 
9.00
%
 
6.64
%
 
3.46

 
4.16

Return on average tangible common equity
 
19.14
%
 
13.17
%
 
14.34
%
 
16.42
%
 
12.18
%
 
5.97

 
6.96

Efficiency ratio – Consolidated
 
51.64
%
 
60.44
%
 
58.58
%
 
57.06
%
 
65.84
%
 
(8.80
)
 
(14.20
)
Efficiency ratio – Bank
 
50.16
%
 
58.57
%
 
57.67
%
 
54.70
%
 
63.04
%
 
(8.41
)
 
(12.88
)

(1) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.


Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 14


Umpqua Holdings Corporation
Selected Ratios
(Unaudited)
 
 
Six Months Ended
 
% Change
 
 
Jun 30, 2019
 
Jun 30, 2018
 
Year over Year
Average Rates:
 
 

 
 

 
 
Yield on loans held for sale
 
5.41
%
 
4.57
%
 
0.84

Yield on loans and leases
 
5.07
%
 
4.87
%
 
0.20

Yield on taxable investments
 
2.30
%
 
1.82
%
 
0.48

Yield on tax-exempt investments (1)
 
3.51
%
 
3.66
%
 
(0.15
)
Yield on interest bearing cash and temporary investments
 
2.42
%
 
1.72
%
 
0.70

Total yield on earning assets (1)
 
4.69
%
 
4.44
%
 
0.25

 
 
 
 
 
 


Cost of interest bearing deposits
 
1.07
%
 
0.55
%
 
0.52

Cost of securities sold under agreements
 
 

 
 

 


to repurchase and fed funds purchased
 
0.74
%
 
0.15
%
 
0.59

Cost of term debt
 
1.96
%
 
1.72
%
 
0.24

Cost of junior subordinated debentures
 
6.20
%
 
5.62
%
 
0.58

Total cost of interest bearing liabilities
 
1.23
%
 
0.73
%
 
0.50

 
 
 
 
 
 


Net interest spread (1)
 
3.46
%
 
3.71
%
 
(0.25
)
Net interest margin (1)
 
3.86
%
 
3.96
%
 
(0.10
)
 
 
 
 
 
 


Performance Ratios:
 
 

 
 

 


Return on average assets
 
1.37
%
 
1.13
%
 
0.24

Return on average tangible assets
 
1.47
%
 
1.22
%
 
0.25

Return on average common equity
 
9.09
%
 
7.34
%
 
1.75

Return on average tangible common equity
 
16.21
%
 
13.50
%
 
2.71

Efficiency ratio – Consolidated
 
55.58
%
 
63.50
%
 
(7.92
)
Efficiency ratio – Bank
 
53.94
%
 
61.12
%
 
(7.18
)
        
(1) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 15


Umpqua Holdings Corporation
Average Balances
(Unaudited)
 
Quarter Ended
 
% Change
(Dollars in thousands)
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
Seq. Quarter
 
Year over Year
Temporary investments and interest bearing cash
$
783,703

 
$
153,347

 
$
462,621

 
$
558,597

 
$
458,133

 
411
 %
 
71
 %
Investment securities, taxable
2,683,472

 
2,757,644

 
2,716,616

 
2,687,635

 
2,723,406

 
(3
)%
 
(1
)%
Investment securities, tax-exempt
271,633

 
287,366

 
282,998

 
278,937

 
279,158

 
(5
)%
 
(3
)%
Loans held for sale
264,445

 
187,656

 
238,958

 
320,494

 
326,427

 
41
 %
 
(19
)%
Loans and leases
20,605,963

 
20,388,988

 
20,051,674

 
19,709,113

 
19,387,537

 
1
 %
 
6
 %
Total interest earning assets
24,609,216

 
23,775,001

 
23,752,867

 
23,554,776

 
23,174,661

 
4
 %
 
6
 %
Goodwill and other intangible assets, net
1,809,583

 
1,811,007

 
1,812,487

 
1,814,000

 
1,815,529

 
0
 %
 
0
 %
Total assets
27,709,310

 
26,811,621

 
26,672,224

 
26,461,526

 
26,076,142

 
3
 %
 
6
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest bearing demand deposits
6,556,090

 
6,505,615

 
6,828,730

 
6,865,676

 
6,645,689

 
1
 %
 
(1
)%
Interest bearing deposits
15,069,198

 
14,304,325

 
14,138,852

 
13,897,141

 
13,745,089

 
5
 %
 
10
 %
Total deposits
21,625,288

 
20,809,940

 
20,967,582

 
20,762,817

 
20,390,778

 
4
 %
 
6
 %
Interest bearing liabilities
16,646,949

 
15,858,561

 
15,547,250

 
15,331,529

 
15,199,900

 
5
 %
 
10
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Shareholders' equity - common
4,153,175

 
4,091,174

 
4,035,125

 
4,011,856

 
3,988,825

 
2
 %
 
4
 %
Tangible common equity (1)
2,343,592

 
2,280,167

 
2,222,638

 
2,197,856

 
2,173,296

 
3
 %
 
8
 %
Umpqua Holdings Corporation
Average Balances
(Unaudited)
 
 
Six Months Ended
% Change
(Dollars in thousands)
 
Jun 30, 2019
 
Jun 30, 2018
 
Year over Year
Temporary investments and interest bearing cash
 
$
470,266

 
$
381,328

 
23
 %
Investment securities, taxable
 
2,720,353

 
2,758,235

 
(1
)%
Investment securities, tax-exempt
 
279,456

 
282,860

 
(1
)%
Loans held for sale
 
226,263

 
296,992

 
(24
)%
Loans and leases
 
20,498,075

 
19,239,586

 
7
 %
Total interest earning assets
 
24,194,413

 
22,959,001

 
5
 %
Goodwill and other intangible assets, net
 
1,810,291

 
1,816,294

 
0
 %
Total assets
 
27,262,945

 
25,856,690

 
5
 %
 
 
 
 
 
 
 
Non-interest bearing demand deposits
 
6,530,992

 
6,548,566

 
0
 %
Interest bearing deposits
 
14,688,875

 
13,619,723

 
8
 %
Total deposits
 
21,219,867

 
20,168,289

 
5
 %
Interest bearing liabilities
 
16,254,933

 
15,086,460

 
8
 %
 
 
 
 
 
 
 
Shareholders’ equity - common
 
4,122,346

 
3,981,948

 
4
 %
Tangible common equity (1)
 
2,312,055

 
2,165,654

 
7
 %
 
 
 
 
 
 
 
(1) Average tangible common equity is a non-GAAP financial measure. Average tangible common equity is calculated as average common shareholders' equity less average goodwill and other intangible assets, net (excluding MSRs).



Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 16


Umpqua Holdings Corporation
Average Rates and Balances
(Unaudited)
(dollars in thousands)
Quarter Ended
 
June 30, 2019
 
March 31, 2019
 
June 30, 2018
 
Average Balance
 
Interest Income or Expense
 
Average Yields or Rates
 
Average Balance
 
Interest Income or Expense
 
Average Yields or Rates
 
Average Balance
 
Interest Income or Expense
 
Average Yields or Rates
INTEREST-EARNING ASSETS:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Loans held for sale
$
264,445

 
$
3,326

 
5.03
%
 
$
187,656

 
$
2,790

 
5.95
%
 
$
326,427

 
$
3,967

 
4.86
%
Loans and leases (1)
20,605,963

 
260,784

 
5.07
%
 
20,388,988

 
255,957

 
5.06
%
 
19,387,537

 
238,156

 
4.91
%
Taxable securities
2,683,472

 
10,861

 
1.62
%
 
2,757,644

 
20,473

 
2.96
%
 
2,723,406

 
8,932

 
1.31
%
Non-taxable securities (2)
271,633

 
2,325

 
3.42
%
 
287,366

 
2,580

 
3.59
%
 
279,158

 
2,539

 
3.64
%
Temporary investments and interest-bearing cash
783,703

 
4,708

 
2.41
%
 
153,347

 
925

 
2.44
%
 
458,133

 
2,080

 
1.82
%
Total interest-earning assets
24,609,216

 
$
282,004

 
4.59
%
 
23,775,001

 
282,725

 
4.79
%
 
23,174,661

 
$
255,674

 
4.41
%
Other assets
3,100,094

 
 
 
 
 
3,036,620

 
 
 
 
 
2,901,481

 
 
 
 
Total assets
$
27,709,310

 
 
 
 
 
$
26,811,621

 
 
 
 
 
$
26,076,142

 
 
 
 
INTEREST-BEARING LIABILITIES:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing demand deposits
$
2,332,535

 
$
2,798

 
0.48
%
 
$
2,319,718

 
$
2,640

 
0.46
%
 
$
2,322,359

 
$
1,565

 
0.27
%
Money market deposits
6,747,290

 
15,351

 
0.91
%
 
6,391,721

 
11,017

 
0.70
%
 
6,332,372

 
5,896

 
0.37
%
Savings deposits
1,454,908

 
410

 
0.11
%
 
1,488,530

 
270

 
0.07
%
 
1,456,625

 
252

 
0.07
%
Time deposits
4,534,465

 
25,032

 
2.21
%
 
4,104,356

 
20,167

 
1.99
%
 
3,633,733

 
13,546

 
1.50
%
Total interest-bearing deposits
15,069,198

 
43,591

 
1.16
%
 
14,304,325

 
34,094

 
0.97
%
 
13,745,089

 
21,259

 
0.62
%
Repurchase agreements and federal funds purchased
292,057

 
403

 
0.55
%
 
371,336

 
810

 
0.88
%
 
285,338

 
155

 
0.22
%
Term debt
903,164

 
4,563

 
2.03
%
 
793,797

 
3,683

 
1.88
%
 
801,768

 
3,478

 
1.74
%
Junior subordinated debentures
382,530

 
5,881

 
6.17
%
 
389,103

 
5,987

 
6.24
%
 
367,705

 
5,400

 
5.89
%
Total interest-bearing liabilities
16,646,949

 
$
54,438

 
1.31
%
 
15,858,561

 
$
44,574

 
1.14
%
 
15,199,900

 
$
30,292

 
0.80
%
Non-interest-bearing deposits
6,556,090

 
 
 
 
 
6,505,615

 
 
 
 
 
6,645,689

 
 
 
 
Other liabilities
353,096

 
 
 
 
 
356,271

 
 
 
 
 
241,728

 
 
 
 
Total liabilities
23,556,135

 
 
 
 
 
22,720,447

 
 
 
 
 
22,087,317

 
 
 
 
Common equity
4,153,175

 
 
 
 
 
4,091,174

 
 
 
 
 
3,988,825

 
 
 
 
Total liabilities and shareholders' equity
$
27,709,310

 
 
 
 
 
$
26,811,621

 
 
 
 
 
$
26,076,142

 
 
 
 
NET INTEREST INCOME
 
 
$
227,566

 
 
 
 
 
$
238,151

 
 
 
 
 
$
225,382

 
 
NET INTEREST SPREAD
 
 
 
 
3.28
%
 
 
 
 
 
3.65
%
 
 
 
 
 
3.61
%
NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)
 
 
 
 
3.70
%
 
 
 
 
 
4.03
%
 
 
 
 
 
3.89
%
(1)
Non-accrual loans and leases are included in the average balance.   
(2)
Tax-exempt income has been adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $404,000 for the three months ended June 30, 2019 as compared to $466,000 for March 31, 2019 and $482,000 for June 30, 2018. 


Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 17


Umpqua Holdings Corporation Average Rates and Balances
(Unaudited)
(dollars in thousands)
Six Months Ended
 
June 30, 2019
 
June 30, 2018
 
Average Balance
 
Interest Income or Expense
 
Average Yields or Rates
 
Average Balance
 
Interest Income or Expense
 
Average Yields or Rates
INTEREST-EARNING ASSETS:
 
 
 
 
 
 
 
 
 
 
 

Loans held for sale
$
226,263

 
$
6,116

 
5.41
%
 
$
296,992

 
$
6,782

 
4.57
%
Loans and leases (1)
20,498,075

 
516,741

 
5.07
%
 
19,239,586

 
464,829

 
4.87
%
Taxable securities
2,720,353

 
31,334

 
2.30
%
 
2,758,235

 
25,099

 
1.82
%
Non-taxable securities (2)
279,456

 
4,905

 
3.51
%
 
282,860

 
5,179

 
3.66
%
Temporary investments and interest-bearing cash
470,266

 
5,633

 
2.42
%
 
381,328

 
3,244

 
1.72
%
Total interest-earning assets
24,194,413

 
$
564,729

 
4.69
%
 
22,959,001

 
$
505,133

 
4.44
%
Other assets
3,068,532

 
 
 
 
 
2,897,689

 
 
 
 
Total assets
$
27,262,945

 
 
 
 
 
$
25,856,690

 
 
 
 
INTEREST-BEARING LIABILITIES:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing demand deposits
$
2,326,162

 
$
5,438

 
0.47
%
 
$
2,322,793

 
$
2,775

 
0.24
%
Money market deposits
6,570,488

 
26,368

 
0.81
%
 
6,618,629

 
11,609

 
0.35
%
Savings deposits
1,471,626

 
680

 
0.09
%
 
1,459,824

 
414

 
0.06
%
Time deposits
4,320,599

 
45,199

 
2.11
%
 
3,218,477

 
22,071

 
1.38
%
Total interest-bearing deposits
14,688,875

 
77,685

 
1.07
%
 
13,619,723

 
36,869

 
0.55
%
Repurchase agreements and federal funds purchased
331,477

 
1,213

 
0.74
%
 
294,150

 
218

 
0.15
%
Term debt
848,783

 
8,246

 
1.96
%
 
802,031

 
6,839

 
1.72
%
Junior subordinated debentures
385,798

 
11,868

 
6.20
%
 
370,556

 
10,332

 
5.62
%
Total interest-bearing liabilities
16,254,933

 
$
99,012

 
1.23
%
 
15,086,460

 
$
54,258

 
0.73
%
Non-interest-bearing deposits
6,530,992

 
 
 
 
 
6,548,566

 
 
 
 
Other liabilities
354,674

 
 
 
 
 
239,716

 
 
 
 
Total liabilities
23,140,599

 
 
 
 
 
21,874,742

 
 
 
 
Common equity
4,122,346

 
 
 
 
 
3,981,948

 
 
 
 
Total liabilities and shareholders' equity
$
27,262,945

 
 
 
 
 
$
25,856,690

 
 
 
 
NET INTEREST INCOME
 
 
$
465,717

 
 
 
 
 
$
450,875

 
 
NET INTEREST SPREAD
 
 
 
 
3.46
%
 
 
 
 
 
3.71
%
NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)
 
 
 
 
3.86
%
 
 
 
 
 
3.96
%
(1)
Non-accrual loans and leases are included in the average balance.   
(2)
Tax-exempt income has been adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $870,000 for the six months ended June 30, 2019 as compared to $1.0 million for the same period in 2018. 


Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 18



Umpqua Holdings Corporation
Residential Mortgage Banking Activity
(Unaudited)
 
 
Quarter Ended
 
% Change
(Dollars in thousands)
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Jun 30, 2018
 
Seq. Quarter
 
Year over Year
Residential mortgage banking revenue:
 
 

 
 

 
 
 
 
 
 

 


 


Origination and sale
 
$
23,151

 
$
14,373

 
$
16,665

 
$
20,983

 
$
28,159

 
61
 %
 
(18
)%
Servicing
 
11,036

 
10,824

 
11,555

 
10,302

 
10,407

 
2
 %
 
6
 %
Change in fair value of MSR asset:
 
 
 
 
 
 
 
 
 
 
 


 


Changes due to collection/realization of expected cash flows over time
 
(6,905
)
 
(6,431
)
 
(6,425
)
 
(6,007
)
 
(5,903
)
 
7
 %
 
17
 %
Changes due to valuation inputs or assumptions
 
(17,753
)
 
(7,535
)
 
(6,645
)
 
6,206

 
500

 
136
 %
 
(3,651
)%
Total
 
$
9,529

 
$
11,231

 
$
15,150

 
$
31,484

 
$
33,163

 
(15
)%
 
(71
)%
 
 
 
 
 
 
 
 
 
 
 
 


 


Closed loan volume:
 
 
 
 
 
 
 
 
 
 
 


 


Portfolio
 
$
481,878

 
$
318,612

 
$
312,524

 
$
323,941

 
$
294,581

 
51
 %
 
64
 %
For-sale
 
698,150

 
487,090

 
589,355

 
756,924

 
839,489

 
43
 %
 
(17
)%
Total
 
$
1,180,028

 
$
805,702

 
$
901,879

 
$
1,080,865

 
$
1,134,070

 
46
 %
 
4
 %
 
 
 
 
 
 
 
 
 
 
 
 


 


Gain on sale margin:
 
 
 
 
 
 
 
 
 
 
 


 


Based on for-sale volume
 
3.32
%
 
2.95
%
 
2.83
%
 
2.77
%
 
3.35
%
 
0.37

 
(0.03
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage servicing rights:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of period
 
$
158,946

 
$
169,025

 
$
175,038

 
$
166,217

 
$
164,760

 
(6
)%
 
(4
)%
Additions for new MSR capitalized
 
5,492

 
3,887

 
7,057

 
8,622

 
6,860

 
41
 %
 
(20
)%
Changes in fair value of MSR asset:
 
 
 
 
 
 
 
 
 
 
 


 


Changes due to collection/realization of expected cash flows over time
 
(6,905
)
 
(6,431
)
 
(6,425
)
 
(6,007
)
 
(5,903
)
 
7
 %
 
17
 %
Changes due to valuation inputs or assumptions
 
(17,753
)
 
(7,535
)
 
(6,645
)
 
6,206

 
500

 
136
 %
 
(3,651
)%
Balance, end of period
 
$
139,780

 
$
158,946

 
$
169,025

 
$
175,038

 
$
166,217

 
(12
)%
 
(16
)%
 
 
 
 
 
 
 
 
 
 
 
 


 


Residential mortgage loans serviced for others
 
$
15,796,102

 
$
15,902,587

 
$
15,978,885

 
$
15,810,455

 
$
15,508,182

 
(1
)%
 
2
 %
MSR as % of serviced portfolio
 
0.88
%
 
1.00
%
 
1.06
%
 
1.11
%
 
1.07
%
 
(0.12
)
 
(0.19
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 





Umpqua Reports Second Quarter 2019 Results
July 17, 2019
Page 19



Umpqua Holdings Corporation
Residential Mortgage Banking Activity
(Unaudited)
 
 
Six Months Ended
 
% Change
(Dollars in thousands)
 
Jun 30, 2019
 
Jun 30, 2018
 
Year over Year
Residential mortgage banking revenue:
 
 
 
 
 
 
Origination and sale
 
$
37,524

 
$
50,996

 
(26
)%
Servicing
 
21,860

 
20,929

 
4
 %
Change in fair value of MSR asset:
 
 
 
 
 
 
Changes due to collection/realization of expected cash flows over time
 
(13,336
)
 
(12,101
)
 
10
 %
Changes due to valuation inputs or assumptions
 
(25,288
)
 
11,777

 
(315
)%
Total
 
$
20,760

 
$
71,601

 
(71
)%
 
 
 
 
 
 
 
Closed loan volume:
 
 
 
 
 
 
Portfolio
 
$
800,490

 
$
532,364

 
50
 %
For-sale
 
1,185,240

 
1,526,715

 
(22
)%
Total
 
$
1,985,730

 
$
2,059,079

 
(4
)%
 
 
 
 
 
 
 
Gain on sale margin:
 
 
 
 
 
 
Based on for-sale volume
 
3.17
%
 
3.34
%
 
(0.17
)
 
 
 
 
 
 
 
Residential mortgage servicing rights:
 
 
 
 
 
 
Balance, beginning of period
 
$
169,025

 
$
153,151

 
10
 %
Additions for new MSR capitalized
 
9,379

 
13,390

 
(30
)%
Changes in fair value of MSR asset:
 
 
 
 
 
 
Changes due to collection/realization of expected cash flows over time
 
(13,336
)
 
(12,101
)
 
10
 %
Changes due to valuation inputs or assumptions
 
(25,288
)
 
11,777

 
(315
)%
Balance, end of period
 
$
139,780

 
$
166,217

 
(16
)%
 
 
 
 
 
 
 



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