EX-99.2 3 g12978exv99w2.htm EX-99.2 SUPPLEMENTAL INFORMATION PREPARED FOR USE WITH THE PRESS RELEASE EX-99.2 SUPPLEMENTAL INFORMATION
 

Exhibit 99.2
3 of 7
Synovus
INCOME STATEMENT DATA
(Unaudited)
(In thousands, except per share data)
                                                 
    2008     2007     1st Quarter  
    First     Fourth     Third     Second     First     ’08 vs. ’07  
    Quarter     Quarter     Quarter     Quarter     Quarter     Change  
Interest income (taxable equivalent)
   $ 505,057       554,989       573,545       565,777       549,243       (8.0 )%
Interest expense
     225,232       267,102       281,478       276,017       264,950       (15.0 )
 
                                    
 
Net interest income (taxable equivalent)
     279,825       287,887       292,067       289,760       284,293       (1.6 )
Tax equivalent adjustment
     1,176       1,202       1,228       1,285       1,344       (12.5 )
 
                                    
 
Net interest income
     278,649       286,685       290,839       288,475       282,949       (1.5 )
Provision for loan losses
     91,049       70,642       58,770       20,281       20,515       343.8  
 
                                    
 
Net interest income after provision
     187,600       216,043       232,069       268,194       262,434       (28.5 )
 
                                    
 
Non-interest income:
                                                
Service charges on deposit accounts
     28,391       28,985       28,736       28,050       26,370       7.7  
Fiduciary and asset management fees
     12,621       13,110       12,524       12,658       12,473       1.2  
Brokerage and investment banking revenue
     8,487       8,598       8,123       7,809       7,449       13.9  
Mortgage banking income
     8,161       6,130       5,955       7,695       7,226       12.9  
Bankcard fees
     12,219       12,400       11,923       11,567       11,880       2.9  
Net gains on sales of available for sale investment securities
     —       90       186       258       447     nm
Other fee income
     11,185       9,559       9,910       10,411       9,427       18.6  
Other non-interest income
     20,370       20,126       28,837       17,883       12,231       66.5  
Proceeds from Visa IPO
     38,542       —       —       —       —     nm
 
                                    
 
Total non-interest income
     139,976       98,998       106,194       96,331       87,503       60.0  
 
                                    
 
                                                
Non-interest expense:
                                                
Salaries and other personnel expense
     122,130       109,468       115,941       115,822       113,927       7.2  
Net occupancy and equipment expense
     30,211       29,976       28,055       27,572       27,290       10.7  
Other operating expense
     66,463       70,965       56,429       54,267       53,580       24.0  
Visa litigation expense
     (17,430 )     24,800       12,000       —       —     nm
 
                                    
 
                                                
Total non-interest expense
     201,374       235,209       212,425       197,661       194,797       3.4  
 
                                    
 
                                                
Minority interest in consolidated subsidiaries
     1,559       —       —       —       —     nm
Income from continuing operations before income taxes
     124,643       79,832       125,838       166,864       155,140       (19.7 )
Income tax expense
     43,648       26,690       42,261       61,055       54,733       (20.3 )
 
                                    
 
                                                
Income from continuing operations
     80,995       53,142       83,577       105,809       100,407       (19.3 )
 
                                                
Income from discontinued operations, net of income taxes and minority interest (1)
     —       28,717       51,366       56,941       46,346     nm
 
                                    
Net income
   $ 80,995       81,859       134,943       162,750       146,753       (44.8 )
 
                                    
 
                                                
Basic earnings per share
                                                
Income from continuing operations
   $ 0.25       0.16       0.26       0.32       0.31       (20.1 )%
Net income
     0.25       0.25       0.41       0.50       0.45       (45.5 )
 
                                                
Diluted earnings per share
                                                
Income from continuing operations
     0.24       0.16       0.25       0.32       0.30       (19.9 )
Net income
     0.24       0.25       0.41       0.49       0.45       (45.2 )
 
                                                
Cash dividends declared per share
     0.17       0.21       0.21       0.21       0.21       (17.1 )
 
                                                
Return on average assets from continuing operations*
     0.99 %     0.65       1.05       1.35       1.33     (34 )bp 
Return on average assets *
     0.99       1.01       1.66       1.97       1.82       (83 )
Return on average equity from continuing operations*
     9.43       5.17       8.25       10.85       10.91       (148 )
Return on average equity *
     9.43       7.97       13.32       16.69       15.94       (651 )
 
                                                
Average shares outstanding — basic
     328,970       328,052       327,215       326,410       325,687       1.0 %
Average shares outstanding — diluted
     331,719       329,453       330,160       330,263       329,573       0.7  
 
bp    —  change is measured as difference in basis points.
 
nm     —  not meaningful
 
*   —  ratios are annualized
 
(1)   On December 31, 2007, Synovus Financial Corp. completed the spin-off of its shares of Total System Services, Inc. (“TSYS”) common stock to Synovus shareholders. In accordance with the provisions of Statement of Financial Accounting Standards (SFAS) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” and SFAS No. 146, “Accounting for Costs Associated with Exit or Disposal Activities,” the historical consolidated results of operations of TSYS, as well as all costs recorded by Synovus Financial Corp. associated with the spin-off of TSYS, are now presented as a discontinued operation. Additionally, discontinued operations for the three months ended June 30, 2007 includes a $4.2 million after-tax gain related to the transfer of Synovus’ proprietary mutual funds to a non-affiliated third party.

 

 

4 of 7
Synovus
BALANCE SHEET DATA
(Unaudited)
(In thousands, except share data)
                         
    March 31, 2008     December 31, 2007     March 31, 2007  
ASSETS
                        
Cash and due from banks
   $ 589,640       682,583       632,061  
Interest earning deposits with banks
     2,440       10,950       35,511  
Federal funds sold and securities purchased under resale agreements
     101,855       76,086       190,514  
Trading account assets
     34,730       17,803       45,289  
Mortgage loans held for sale
     141,598       153,437       181,266  
Impaired loans held for sale
     42,270       —       —  
Investment securities available for sale
     3,779,877       3,666,974       3,520,777  
 
                        
Loans, net of unearned income
     27,117,510       26,498,585       25,223,681  
Allowance for loan losses
     (394,848 )     (367,613 )     (326,826 )
 
                  
Loans, net
     26,722,662       26,130,972       24,896,855  
 
                  
Premises and equipment, net
     565,887       547,437       493,704  
Goodwill
     519,138       519,138       519,138  
Other intangible assets, net
     26,156       28,007       32,635  
Other assets
     1,249,347       1,185,065       878,194  
Assets of discontinued operations
     —       —       1,399,218  
 
                  
 
                        
Total assets
   $ 33,775,600       33,018,452       32,825,162  
 
                  
 
                        
LIABILITIES AND SHAREHOLDERS’ EQUITY
                        
Liabilities:
                        
Deposits:
                        
Non-interest bearing retail and commercial deposits
   $ 3,508,246       3,472,423       3,580,484  
Interest bearing retail and commercial deposits
     17,713,901       17,734,851       18,066,417  
 
                  
 
Total retail and commercial deposits
     21,222,147       21,207,274       21,646,901  
 
Brokered deposits
     4,441,040       3,752,542       3,450,148  
 
                  
 
Total deposits
     25,663,187       24,959,816       25,097,049  
 
Federal funds purchased and other short-term liabilities
     2,108,109       2,319,412       1,573,283  
Long-term debt
     1,992,750       1,890,235       1,538,972  
Other liabilities
     458,775       407,399       432,703  
Liabilities of and minority interest in discontinued operations (1)
     —       —       347,072  
 
                  
Total liabilities
     30,222,821       29,576,862       28,989,079  
 
                  
 
                        
Minority interest in consolidated subsidiaries
     22,772       —       —  
 
                        
Shareholders’ equity:
                        
Common stock, par value $1.00 a share (2)
     335,750       335,529       332,512  
Additional paid-in capital
     1,106,049       1,101,209       1,070,554  
Treasury stock (3)
     (113,944 )     (113,944 )     (113,944 )
Accumulated other comprehensive income
     92,076       31,439       6,989  
Retained earnings
     2,110,076       2,087,357       2,539,972  
 
                  
Total shareholders’ equity (4)
     3,530,007       3,441,590       3,836,083  
 
                  
 
                        
Total liabilities and shareholders’ equity
   $ 33,775,600       33,018,452       32,825,162  
 
                  
 
(1)   On December 31, 2007, Synovus Financial Corp. completed the spin-off of its shares of Total System Services, Inc. (“TSYS”) common stock to Synovus shareholders. In accordance with Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” all prior period assets and liabilities of TSYS are presented as a discontinued operation.
 
(2)   Common shares outstanding: 330,088,033; 329,867,944 and 326,850,123 at March 31, 2008, December 31, 2007, and March 31, 2007, respectively.
 
(3)   Treasury shares: 5,661,538 at March 31, 2008, December 31, 2007, and March 31, 2007.
 
(4)   Book value per share: $10.69 ; $10.43; and $11.74 at March 31, 2008, December 31, 2007, and March 31, 2007, respectively.

 

 

5 of 7
Synovus
AVERAGE BALANCES AND YIELDS/RATES *
(Unaudited)
(Dollars in thousands)
                                         
    2008   2007
    First   Fourth   Third   Second   First
    Quarter   Quarter   Quarter   Quarter   Quarter
     
Interest Earning Assets    
                                        
Taxable Investment Securities
   $ 3,485,370       3,496,843       3,495,017       3,420,831       3,301,137  
Yield
     5.01 %     4.90       4.82       4.83       4.77  
Tax-Exempt Investment Securities
   $ 154,408       164,587       170,211       178,183       185,012  
Yield (taxable equivalent)
     7.00 %     6.82       6.72       6.75       6.84  
Trading Account Assets
   $ 36,652       29,698       56,217       59,311       64,204  
Yield
     6.96 %     7.05       7.15       6.47       5.65  
Commercial Loans
   $ 22,763,954       22,157,460       21,820,687       21,739,107       21,242,921  
Yield
     6.79 %     7.69       8.13       8.20       8.24  
Consumer Loans
   $ 931,644       928,942       915,847       896,267       928,256  
Yield
     7.86 %     8.05       8.17       8.14       8.01  
Mortgage Loans
   $ 1,241,018       1,237,962       1,152,621       1,110,754       1,081,760  
Yield
     6.84 %     7.04       7.10       7.03       6.98  
Credit Card Loans
   $ 296,428       285,410       277,445       275,105       270,444  
Yield
     9.65 %     10.26       10.96       10.64       11.17  
Home Equity Loans
   $ 1,557,852       1,517,510       1,444,411       1,407,005       1,385,012  
Yield
     6.48 %     7.34       7.80       7.82       7.68  
Allowance for Loan Losses
   $ (381,695 )     (357,283 )     (335,406 )     (329,028 )     (317,977 )
     
Loans, Net
   $ 26,409,201       25,770,001       25,275,605       25,099,210       24,590,416  
Yield
     6.94 %     7.79       8.21       8.26       8.28  
Mortgage Loans Held for Sale
   $ 121,806       108,044       176,448       163,364       160,482  
Yield
     5.57 %     6.12       6.91       6.18       6.07  
Federal Funds Sold and Other Short-Term Investments
   $ 128,381       110,745       85,094       131,029       147,857  
Yield
     3.41 %     4.63       5.76       5.37       5.55  
     
 
                                        
Total Interest Earning Assets
   $ 30,335,818       29,679,918       29,258,592       29,051,928       28,449,108  
Yield
     6.69 %     7.42       7.78       7.81       7.82  
     
 
                                        
Interest Bearing Liabilities  
                                        
 
                                        
Interest Bearing Demand Deposits
   $ 3,200,650       3,200,408       3,047,279       3,141,899       3,113,531  
Rate
     1.56 %     1.99       2.24       2.28       2.30  
Money Market Accounts
   $ 7,115,062       7,502,063       7,421,900       7,217,265       6,977,950  
Rate
     2.99 %     3.92       4.40       4.46       4.47  
Savings Deposits
   $ 448,581       454,204       479,479       497,422       502,948  
Rate
     0.28 %     0.35       0.48       0.57       0.68  
Time Deposits Under $100,000
   $ 2,777,764       2,790,869       2,917,089       3,020,881       3,037,815  
Rate
     4.44 %     4.69       4.81       4.85       4.79  
Time Deposits Over $100,000 (less brokered time deposits)
   $ 4,171,716       4,006,350       4,029,091       4,118,221       4,101,471  
Rate
     4.69 %     4.98       5.12       5.19       5.15  
     
Total Interest Bearing Core Deposits
   $ 17,713,773       17,953,894       17,894,838       17,995,688       17,733,715  
Rate
     3.29 %     3.84       4.16       4.20       4.22  
Brokered Money Market Accounts
   $ 756,967       467,346       476,377       426,988       358,574  
Rate
     3.44 %     4.89       5.34       5.45       5.47  
Brokered Time Deposits
   $ 3,300,677       2,941,592       3,188,310       3,175,161       3,030,793  
Rate
     4.35 %     4.98       5.19       5.05       5.08  
     
Total Interest Bearing Deposits
   $ 21,771,417       21,362,832       21,559,525       21,597,837       21,123,082  
Rate
     3.46 %     4.02       4.33       4.35       4.34  
Federal Funds Purchased and Other Short-Term Liabilities
   $ 2,253,640       2,472,339       1,930,598       1,720,535       1,700,304  
Rate
     3.18 %     4.37       4.84       4.96       4.86  
Long-Term Debt
   $ 1,930,412       1,819,198       1,660,788       1,552,310       1,441,241  
Rate
     4.21 %     5.08       5.32       5.18       5.07  
     
Total Interest Bearing Liabilities
   $ 25,955,469       25,654,369       25,150,911       24,870,682       24,264,627  
Rate
     3.48 %     4.12       4.43       4.44       4.42  
     
Non-Interest Bearing Demand Deposits
   $ 3,338,106       3,422,684       3,405,622       3,428,246       3,381,056  
     
Net Interest Margin
     3.71 %     3.86       3.97       4.00       4.05  
     
 
*   Yields and rates are annualized.
 
(1)   On December 31, 2007, Synovus Financial Corp. completed the spin-off of its shares of Total System Services, Inc. (“TSYS”) common stock to Synovus shareholders. In accordance with the provisions of Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” the historical consolidated results of operations, assets, and liabilities of TSYS are now presented as a discontinued operation. Accordingly, the above earning assets, liabilities, yields, and cost of funds exclude the amounts related to TSYS due to the de-consolidation of TSYS.

 

 

6 of 7
Synovus
      LOANS OUTSTANDING AND NONPERFORMING LOANS COMPOSITION
      (Unaudited)
      (Dollars in thousands)
                                 
    March 31, 2008  
            Loans as a %     Total     Nonperforming Loans  
            of Total Loans     Nonperforming     as a % of Total  
Loan Type   Total Loans     Outstanding     Loans     Nonperforming Loans  
     
Multi-Family
   $ 505,828       1.9 %   $ 1,751       0.3 %
Hotels
     707,916       2.6       437       0.1  
Office Buildings
     983,935       3.6       2,590       0.5  
Shopping Centers
     890,651       3.3       734       0.1  
Commercial Development
     891,681       3.3       12,060       2.4  
Other Investment Property
     835,686       3.1       3,493       0.7  
 
                        
 
Total Investment Properties
     4,815,697       17.8       21,065       4.1  
 
                        
 
1-4 Family Construction
     2,153,555       7.9       193,715       37.6  
1-4 Family Perm / Mini-Perm
     1,310,397       4.8       36,306       7.1  
Residential Development
     2,314,776       8.5       116,161       22.5  
 
                        
 
Total 1-4 Family Properties
     5,778,728       21.2       346,182       67.2  
 
                        
 
Land Acquisition
     1,545,146       5.7       46,996       9.1  
 
                        
 
Total Commercial Real Estate
     12,139,571       44.8       414,243       80.4  
 
                        
 
Commercial , Financial, and Agricultural
     6,657,591       24.6       61,701       12.0  
Owner-Occupied
     4,315,945       15.9       21,317       4.1  
 
                        
 
Total Commercial & Industrial
     10,973,536       40.5       83,018       16.1  
 
                                
Home Equity
     1,584,299       5.8       5,689       1.1  
Consumer Mortgages
     1,663,132       6.1       10,734       2.1  
Credit Card
     297,099       1.1       —       —  
Other Retail Loans
     503,943       1.9       1,618       0.3  
 
                        
 
Total Retail
     4,048,473       14.9       18,041       3.5  
 
Unearned Income
     (44,070 )     (0.2 )     —       —  
 
                        
 
Total
   $ 27,117,510       100.0 %   $ 515,302       100.0 %
 
                        
LOANS OUTSTANDING BY TYPE COMPARISON
(Unaudited)
(Dollars in thousands)
                                         
                           
    Total Loans     1Q08 vs. 4Q07             1Q07 vs. 1Q08  
Loan Type   March 31, 2008     December 31, 2007     % change (1)     March 31, 2007     % change  
     
Multi-Family
   $ 505,828       452,163       47.7 %   $ 519,219       (2.6 )%
Hotels
     707,916       614,979       60.8       661,985       6.9  
Office Buildings
     983,935       953,093       13.0       852,973       15.4  
Shopping Centers
     890,651       834,025       27.3       742,344       20.0  
Commercial Development
     891,681       961,271       (29.1 )     866,921       2.9  
Other Investment Property
     835,686       714,296       68.4       563,993       48.2  
 
                                        
 
                              
Total Investment Properties
     4,815,697       4,529,827       25.4       4,207,435       14.5  
 
                              
 
1-4 Family Construction
     2,153,555       2,238,925       (15.3 )     2,404,235       (10.4 )
1-4 Family Perm / Mini-Perm
     1,310,397       1,273,843       11.5       1,145,235       14.4  
Residential Development
     2,314,776       2,311,459       0.6       2,178,573       6.3  
 
                              
 
Total 1-4 Family Properties
     5,778,728       5,824,227       (3.1 )     5,728,043       0.9  
 
                              
 
Land Acquisition
     1,545,146       1,545,933       (0.2 )     1,516,526       1.9  
 
                              
 
Total Commercial Real Estate
     12,139,571       11,899,987       8.1       11,452,004       6.0  
 
                              
 
Commercial , Financial, and Agricultural
     6,657,591       6,420,689       14.8       6,052,487       10.0  
Owner-Occupied
     4,315,945       4,226,707       8.5       4,090,859       5.5  
 
                              
Total Commercial & Industrial
     10,973,536       10,647,396       12.3       10,143,346       8.2  
 
                                        
Home Equity
     1,584,299       1,543,701       10.6       1,401,898       13.0  
Consumer Mortgages
     1,663,132       1,667,924       (1.2 )     1,518,168       9.5  
Credit Card
     297,099       291,149       8.2       273,462       8.6  
Other Retail Loans
     503,943       494,591       7.6       483,412       4.2  
 
                              
 
Total Retail
     4,048,473       3,997,365       5.1       3,676,940       10.1  
 
Unearned Income
     (44,070 )     (46,163 )     (18.2 )     (48,609 )     (9.3 )
 
                              
 
                                        
Total
   $ 27,117,510       26,498,585       9.4 %   $ 25,223,681       7.5 %
 
                              
 
(1)   Percentage change is annualized.

 

 

7 of 7
Synovus
CREDIT QUALITY DATA
(Unaudited)
(Dollars in thousands)
                                                 
    2008   2007   1st Quarter
    First   Fourth   Third   Second   First   ’08 vs. ’07
    Quarter   Quarter   Quarter   Quarter   Quarter   Change
     
Nonperforming Loans (1)
   $ 515,302       342,082       224,055       180,776       138,790       271.3 %
Impaired Loans Held for Sale (2)
     42,270       —       —       —       —     NM
Other Real Estate
     121,753       101,487       76,514       41,259       31,710       284.0  
Nonperforming Assets
     679,325       443,569       300,569       222,035       170,500       298.4  
 
                                                
Allowance for Loan Losses
     394,848       367,613       356,887       331,130       326,826       20.8  
 
                                                
Net Charge-Offs — Quarter
     63,813       59,916       33,013       15,978       8,148       683.2  
Net Charge-Offs — YTD
     63,813       117,055       57,139       24,126       8,148       683.2  
Net Charge-Offs / Average Loans — Quarter (5)
     0.95 %     0.91 %     0.51       0.25       0.13          
Net Charge-Offs / Average Loans — YTD
     0.95       0.46       0.30       0.19       0.13          
 
                                                
Nonperforming Loans / Loans
     1.90       1.29       0.87       0.71       0.55          
Nonperforming Assets / Loans, Impaired Loans Held for Sale & ORE
     2.49       1.67       1.16       0.87       0.68          
Allowance / Loans
     1.46       1.39       1.38       1.30       1.30          
 
                                                
Allowance / Nonperforming Loans
     76.62       107.46       159.29       183.17       235.48          
Allowance / Nonperforming Loans (excluding impaired loans for which there is no related allowance for loan losses (3))
     218.33       337.49       334.42       417.79       424.79          
 
                                                
Past Due Loans over 90 days and still accruing
     43,009       33,663       22,667       23,067       27,414       56.9 %
As a Percentage of Loans Outstanding
     0.16       0.13       0.09       0.09       0.11          
 
                                                
Total Past Due Loans and Still Accruing
     377,999       270,496       230,035       164,180       150,188       151.7  
As a Percentage of Loans Outstanding
     1.39       1.02       0.89       0.64       0.60          
REGULATORY CAPITAL RATIOS (4)
(Unaudited)
(Dollars in thousands)
                         
    March 31, 2008   December 31, 2007   March 31, 2007
Tier 1 Capital
   $ 2,904,068       2,870,558       3,380,391  
Total Risk-Based Capital
     3,988,884       3,988,171       4,457,498  
Tier 1 Capital Ratio
     9.07 %     9.11       11.09  
Total Risk-Based Capital Ratio
     12.46       12.66       14.62  
Leverage Ratio
     8.96       8.65       10.80  
 
(1)   Includes $334.5 million, $233.2 million, $117.3 million, $101.5 million, and $61.9 at March 31, 2008, December 31, 2007, September 30, 2007, June 30, 2007, and March 31, 2007, respectively of loans considered to be impaired (consisting of collateral dependent loans) for which there is related allowance for loan losses determined in accordance with SFAS No. 114, “Accounting by Creditors for Impairment of a Loan.” The allowance on these loans is zero because the estimated losses on collateral dependent impaired loans have been charged-off, at the time these loans were considered to be impaired .
 
(2)   Represent impaired loans that are intended to be sold. Held for sale loans are carried at the lower of cost or market value.
 
(3)   Impaired loans for which there is no related allowance for loan losses are described in note (1).
 
(4)   March 31, 2008 information is preliminary.
 
(5)   Ratio is annualized.