cade-10q_20200630.htm

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

	June 30, 2020			December 31, 2019
(In thousands, except share data)				(Audited)
ASSETS
Cash and due from banks	$	185,919		$	252,447
Interest-bearing deposits with banks		1,696,051			725,343
Federal funds sold		17,399			10,974
Total cash and cash equivalents		1,899,369			988,764
Investment securities available-for-sale, amortized cost of $2,574,282 and allowance for credit losses of zero at June 30, 2020		2,661,433			2,368,592
FRB and FHLB stock		77,358			76,752
Loans held for sale		38,631			87,649
Loans, net of unearned income		13,699,097			12,983,655
Less: allowance for credit losses		(370,901	)		(119,643	)
Net loans		13,328,196			12,864,012
Premises and equipment, net		126,620			127,867
Cash surrender value of life insurance		185,218			183,400
Net deferred tax asset		65,915			—
Goodwill		43,061			485,336
Other intangible assets, net		94,257			105,613
Other assets		337,695			512,244
Total assets	$	18,857,753		$	17,800,229
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Noninterest-bearing deposits	$	5,220,109		$	3,833,704
Interest-bearing deposits		10,849,173			10,909,090
Total deposits		16,069,282			14,742,794
Federal Home Loan Bank advances		100,000			100,000
Senior debt		49,969			49,938
Subordinated debt		183,142			182,712
Junior subordinated debentures		37,448			37,445
Notes payable		1,663			2,078
Net deferred tax liability		—			24,982
Other liabilities		370,769			199,434
Total liabilities		16,812,273			15,339,383
Shareholders' equity:
Common stock $0.01 par value, authorized 300,000,000 shares; 133,148,613 shares issued and 125,930,741 shares outstanding at June 30, 2020 and 132,984,756 shares issued and 127,597,569 shares outstanding at December 31, 2019		1,331			1,330
Additional paid-in capital		1,875,651			1,873,063
Treasury stock, at cost, 7,217,872 shares and 5,387,187 shares, respectively		(130,725	)		(100,752	)
Retained earnings		25,763			572,503
Accumulated other comprehensive income		273,460			114,702
Total shareholders' equity		2,045,480			2,460,846
Total liabilities and shareholders' equity	$	18,857,753		$	17,800,229

	Three Months Ended June 30,					Six Months Ended June 30,
(In thousands, except share and per share data)	2020			2019		2020			2019
INTEREST INCOME
Interest and fees on loans	$	162,854		$	202,011	$	337,988		$	407,762
Interest and dividends on securities:
Taxable		12,207			10,298		26,222			21,094
Tax-exempt		1,539			1,627		2,966			3,366
Other interest income		575			3,188		2,753			7,087
Total interest income		177,175			217,124		369,929			439,309
INTEREST EXPENSE
Interest on time deposits		10,451			20,298		23,195			37,484
Interest on other deposits		7,690			30,440		29,674			59,925
Interest on borrowed funds		4,320			5,599		8,878			11,824
Total interest expense		22,461			56,337		61,747			109,233
Net interest income		154,714			160,787		308,182			330,076
Provision for credit losses		158,811			28,927		242,240			40,137
Net interest income after provision for credit losses		(4,097	)		131,860		65,942			289,939
NONINTEREST INCOME
Investment advisory revenue		6,505			5,797		12,111			11,439
Trust services revenue		4,092			4,578		8,908			8,913
Credit related fees		4,401			5,341		10,384			10,211
Service charges on deposit accounts		4,852			4,730		11,268			9,860
Bankcard fees		1,716			2,279		3,674			4,492
Payroll processing revenue		1,143			1,161		2,510			2,580
SBA income		1,335			1,415		3,243			2,864
Other service fees		1,528			1,907		3,440			4,011
Securities gains, net		2,286			938		5,280			926
Other income		2,092			3,576		4,201			7,090
Total noninterest income		29,950			31,722		65,019			62,386
NONINTEREST EXPENSE
Salaries and employee benefits		47,158			53,660		95,965			107,131
Premises and equipment		10,634			11,148		21,443			22,106
Merger related expenses		—			4,562		1,281			26,562
Goodwill impairment		—			—		443,695			—
Intangible asset amortization		5,472			5,888		11,065			11,961
Other expense		25,356			25,271		52,824			46,209
Total noninterest expense		88,620			100,529		626,273			213,969
(Loss) income before income taxes		(62,767	)		63,053		(495,312	)		138,356
Income tax (benefit) expense		(6,653	)		14,707		(39,887	)		31,809
Net (loss) income	$	(56,114	)	$	48,346	$	(455,425	)	$	106,547
Weighted average common shares outstanding (Basic)		125,924,652			128,791,933		126,277,549			129,634,049
Weighted average common shares outstanding (Diluted)		125,924,652			129,035,553		126,277,549			129,787,758
(Loss) earnings per common share (Basic)	$	(0.45	)	$	0.37	$	(3.61	)	$	0.82
(Loss) earnings per common share (Diluted)	$	(0.45	)	$	0.37	$	(3.61	)	$	0.82

Delaware		47-1329858
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Title of each class		Trading Symbol		Name of each exchange on which registered
Class A Common Stock		CADE		New York Stock Exchange

Class A Common Stock, $0.01 Par Value		125,962,766
Class		Outstanding as of August 7, 2020

PART I: FINANCIAL INFORMATION		3

ITEM 1.	FINANCIAL STATEMENTS (UNAUDITED)	3

	Consolidated Balance Sheets as of June 30, 2020 and December 31, 2019 (Audited)	3
	Consolidated Statements of Operations for the three and six months ended June 30, 2020 and 2019	4
	Consolidated Statements of Comprehensive (Loss) Income for the three and six months ended June 30, 2020 and 2019	5
	Consolidated Statements of Changes in Shareholders' Equity for the three and six months ended June 30, 2020 and 2019	6
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2020 and 2019	8
	Notes to Consolidated Financial Statements	9

ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	47

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	86

ITEM 4.	CONTROLS AND PROCEDURES	90

PART II: OTHER INFORMATION		91

ITEM 1.	LEGAL PROCEEDINGS	91

ITEM 1A.	RISK FACTORS	91

ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	92

ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	92

ITEM 4.	MINE SAFETY DISCLOSURES	92

ITEM 5.	OTHER INFORMATION	92

ITEM 6.	EXHIBITS	93

☒	Large accelerated filer	☐	Accelerated filer

☐	Non-accelerated filer	☐	Smaller reporting company

		☐	Emerging growth company

	Three Months Ended June 30,					Six Months Ended June 30,
(In thousands)	2020			2019		2020			2019
Net (loss) income	$	(56,114	)	$	48,346	$	(455,425	)	$