EX-99.1 2 tv505260_ex99-1.htm EXHIBIT 99.1

Exhibit 99.1

 



For Immediate Release

 

For more information:

Jefferson Harralson

Chief Financial Officer

(864) 240-6208

Jefferson_Harralson@ucbi.com

 

United Community Banks, Inc. Announces Third Quarter Results

Continued Strong Profitability, EPS up 42% year over year

 

GREENVILLE, SC – October 23, 2018

 

United Community Banks, Inc. (NASDAQ: UCBI) (“United”) realized strong third quarter results, with solid year-over-year loan and deposit growth, favorable efficiency levels and outstanding asset quality trends. Reported earnings per share were $0.54, an increase of 42 percent from a year ago. Excluding merger-related and other charges, earnings per share were $0.55, up 34 percent compared to last year. United also reported higher profitability ratios with increases in both return on assets and return on tangible equity.

 

During the quarter, United benefitted from strong core deposit growth, net interest margin expansion as well as strong mortgage and SBA production. Core transaction deposits were up $70 million and total customer deposits increased by $156 million during the quarter. Compared to last year, mortgage and SBA production increased 23 percent and 10 percent, respectively. Additionally, year-to-date SBA production is 39 percent higher than 2017. Navitas Credit Corporation, United’s equipment finance arm, continued to perform well and was a key growth driver for the quarter.

 

“I am pleased with our third quarter performance and continue to be optimistic about the balance of 2018,” said Lynn Harton, President and Chief Executive Officer of United. “Our new markets and investments continue to perform well and we have high expectations for the remainder of the year and beyond. We are pleased that we were able to exceed our return on assets target and are proud to have attained a 1.42 percent return on assets this quarter on an operating basis. I credit our outstanding team for this performance and am proud they were recognized for creating one of the “Best Banks to Work For” by American Banker for the second year in a row.”

 

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Third Quarter 2018 Financial Highlights:

 

Return on assets of 1.41 percent, or 1.42 percent, excluding merger-related and other charges
Return on common equity of 12.0 percent
Return on tangible equity of 15.8 percent, excluding merger-related and other charges
Loan growth, excluding planned runoff of the indirect portfolio, of 2 percent on an annualized basis
Loan production of $778 million, as compared to $617 million in Q3 2017
Expansion of the net interest margin to 3.95 percent, up 5 basis points from the second quarter of 2018 and up 41 basis points from a year ago
Efficiency ratio of 56.8 percent, or 56.4 percent, excluding merger-related and other charges
Net charge offs of seven basis points, consistent with last quarter
Nonperforming assets of 0.19 percent of total assets, compared with 0.20 percent at June 30, 2018 and 0.23 percent at September 30, 2017

 

Conference Call

 

United will hold a conference call, Wednesday, October 24, 2018, at 11 a.m. ET to discuss the contents of this press release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the conference number 1270387. The conference call also will be webcast and available for replay for 30 days by selecting “Events & Presentations” within the Investor Relations section of United’s website at www.ucbi.com.

 

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UNITED COMMUNITY BANKS, INC.

Financial Highlights

Selected Financial Information

 

                       Third   For the Nine     
   2018   2017   Quarter   Months Ended   YTD 
   Third   Second   First   Fourth   Third   2018-2017   September 30,   2018-2017 
(in thousands, except per share data)  Quarter   Quarter   Quarter   Quarter   Quarter   Change   2018   2017   Change 
INCOME SUMMARY                                             
Interest revenue  $128,721   $122,215   $115,290   $106,757   $98,839        $366,226   $282,963      
Interest expense   16,611    13,739    12,005    9,249    9,064         42,355    24,486      
Net interest revenue   112,110    108,476    103,285    97,508    89,775    25%   323,871    258,477    25%
Provision for credit losses   1,800    1,800    3,800    1,200    1,000         7,400    2,600      
Noninterest income   24,180    23,340    22,396    21,928    20,573    18    69,916    66,332    5 
Total revenue   134,490    130,016    121,881    118,236    109,348    23    386,387    322,209    20 
Expenses   77,718    76,850    73,475    75,882    65,674    18    228,043    191,729    19 
Income before income tax expense   56,772    53,166    48,406    42,354    43,674    30    158,344    130,480    21 
Income tax expense   13,090    13,532    10,748    54,270    15,728    (17)   37,370    50,743    (26)
Net income (loss)   43,682    39,634    37,658    (11,916)   27,946    56    120,974    79,737    52 
Merger-related and other charges   592    2,873    2,646    7,358    3,420         6,111    7,304      
Income tax benefit of merger-related and other charges   (141)   (121)   (628)   (1,165)   (1,147)        (890)   (2,580)     
Impact of remeasurement of deferred tax asset resulting from 2017 Tax Cuts and Jobs Act   -    -    -    38,199    -         -    -      
Release of disproportionate tax effects lodged in OCI   -    -    -    -    -         -    3,400      
Net income - operating (1)  $44,133   $42,386   $39,676   $32,476   $30,219    46   $126,195   $87,861    44 
                                              
PERFORMANCE MEASURES                                             
  Per common share:                                             
    Diluted net income (loss) - GAAP  $0.54   $0.49   $0.47   $(0.16)  $0.38    42   $1.51   $1.10    37 
    Diluted net income - operating  (1)   0.55    0.53    0.50    0.42    0.41    34    1.57    1.21    30 
    Cash dividends declared   0.15    0.15    0.12    0.10    0.10    50    0.42    0.28    50 
    Book value   17.56    17.29    17.02    16.67    16.50    6    17.56    16.50    6 
    Tangible book value (3)   13.54    13.25    12.96    13.65    14.11    (4)   13.54    14.11    (4)
                                              
  Key performance ratios:                                             
    Return on common equity - GAAP (2)(4)   11.96%   11.20%   11.11%   (3.57)%   9.22%        11.43%   9.26%     
    Return on common equity - operating (1)(2)(4)   12.09    11.97    11.71    9.73    9.97         11.93    10.20      
Return on tangible common equity - operating (1)(2)(3)(4)   15.81    15.79    15.26    11.93    11.93         15.62    12.07      
    Return on assets - GAAP (4)   1.41    1.30    1.26    (0.40)   1.01         1.32    0.99      
    Return on assets - operating (1)(4)   1.42    1.39    1.33    1.10    1.09         1.38    1.09      
    Dividend payout ratio - GAAP   27.78    30.61    25.53    (62.50)   26.32         27.81    25.45      
    Dividend payout ratio - operating (1)   27.27    28.30    24.00    23.81    24.39         26.75    23.14      
    Net interest margin (fully taxable equivalent) (4)   3.95    3.90    3.80    3.63    3.54         3.88    3.49      
    Efficiency ratio - GAAP   56.82    57.94    57.83    63.03    59.27         57.52    58.81      
    Efficiency ratio - operating  (1)   56.39    55.77    55.75    56.92    56.18         55.98    56.57      
    Average equity to average assets   11.33    11.21    11.03    11.21    10.86         11.19    10.54      
    Average tangible equity to average assets (3)   8.97    8.83    8.82    9.52    9.45         8.88    9.21      
    Average tangible common equity to average assets (3)   8.97    8.83    8.82    9.52    9.45         8.88    9.21      
    Tangible common equity to risk-weighted assets (3)(5)   11.62    11.36    11.19    12.05    12.80         11.62    12.80      
                                  -           
ASSET QUALITY                                             
  Nonperforming loans  $22,530   $21,817   $26,240   $23,658   $22,921    (2)  $22,530   $22,921    (2)
  Foreclosed properties   1,336    2,597    2,714    3,234    2,736    (51)   1,336    2,736    (51)
    Total nonperforming assets (NPAs)   23,866    24,414    28,954    26,892    25,657    (7)   23,866    25,657    (7)
  Allowance for loan losses   60,940    61,071    61,085    58,914    58,605    4    60,940    58,605    4 
  Net charge-offs   1,466    1,359    1,501    1,061    1,635    (10)   4,326    4,937    (12)
  Allowance for loan losses to loans   0.74%   0.74%   0.75%   0.76%   0.81%        0.74%   0.81%     
  Net charge-offs to average loans (4)   0.07    0.07    0.08    0.06    0.09         0.07    0.09      
  NPAs to loans and foreclosed properties   0.29    0.30    0.35    0.35    0.36         0.29    0.36      
  NPAs to total assets   0.19    0.20    0.24    0.23    0.23         0.19    0.23      
                                              
AVERAGE BALANCES ($ in millions)                                             
  Loans  $8,200   $8,177   $7,993   $7,560   $7,149    15   $8,124   $7,012    16 
  Investment securities   2,916    2,802    2,870    2,991    2,800    4    2,863    2,799    2 
  Earning assets   11,320    11,193    11,076    10,735    10,133    12    11,197    9,969    12 
  Total assets   12,302    12,213    12,111    11,687    10,980    12    12,209    10,788    13 
  Deposits   9,950    9,978    9,759    9,624    8,913    12    9,896    8,723    13 
  Shareholders’ equity   1,394    1,370    1,336    1,310    1,193    17    1,367    1,137    20 
  Common shares - basic (thousands)   79,806    79,753    79,205    76,768    73,151    9    79,588    72,060    10 
  Common shares - diluted (thousands)   79,818    79,755    79,215    76,768    73,162    9    79,598    72,071    10 
                                              
AT PERIOD END ($ in millions)                                             
  Loans  $8,226   $8,220   $8,184   $7,736   $7,203    14   $8,226   $7,203    14 
  Investment securities   2,873    2,834    2,731    2,937    2,847    1    2,873    2,847    1 
  Total assets   12,405    12,386    12,264    11,915    11,129    11    12,405    11,129    11 
  Deposits   10,229    9,966    9,993    9,808    9,127    12    10,229    9,127    12 
  Shareholders’ equity   1,402    1,379    1,357    1,303    1,221    15    1,402    1,221    15 
  Common shares outstanding (thousands)   79,202    79,138    79,123    77,580    73,403    8    79,202    73,403    8 

 

(1)Excludes merger-related and other charges which includes amortization of certain executive change of control benefits, the fourth quarter 2017 impact of remeasurement of United's deferred tax assets following the passage of tax reform legislation and a first quarter 2017 release of disproportionate tax effects lodged in OCI.
(2)Net income less preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).
(3)Excludes effect of acquisition related intangibles and associated amortization.
(4)Annualized.
(5)Third quarter 2018 ratio is preliminary.

 

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UNITED COMMUNITY BANKS, INC.                      
Non-GAAP Performance Measures Reconciliation                      
Selected Financial Information                        
                             

   2018   2017  

For the Nine Months

Ended
September 30,

 
   Third   Second   First   Fourth   Third         
(in thousands, except per share data)  Quarter   Quarter   Quarter   Quarter   Quarter   2018   2017 
                             
Expense reconciliation                                   
Expenses (GAAP)  $77,718   $76,850   $73,475   $75,882   $65,674   $228,043   $191,729 
Merger-related and other charges   (592)   (2,873)   (2,646)   (7,358)   (3,420)   (6,111)   (7,304)
    Expenses - operating  $77,126   $73,977   $70,829   $68,524   $62,254   $221,932   $184,425 
                                    
Net income reconciliation                                   
Net income (loss) (GAAP)  $43,682   $39,634   $37,658   $(11,916)  $27,946   $120,974   $79,737 
Merger-related and other charges   592    2,873    2,646    7,358    3,420    6,111    7,304 
Income tax benefit of merger-related and other charges   (141)   (121)   (628)   (1,165)   (1,147)   (890)   (2,580)
Impact of tax reform on remeasurement of deferred tax asset   -    -    -    38,199    -    -    - 
Release of disproportionate tax effects lodged in OCI   -    -    -    -    -    -    3,400 
    Net income - operating  $44,133   $42,386   $39,676   $32,476   $30,219   $126,195   $87,861 
Diluted income per common share reconciliation                                   
Diluted income (loss) per common share (GAAP)  $0.54   $0.49   $0.47   $(0.16)  $0.38   $1.51   $1.10 
Merger-related and other charges   0.01    0.04    0.03    0.08    0.03    0.06    0.06 
Impact of tax reform on remeasurement of deferred tax asset   -    -    -    0.50    -    -    - 
Release of disproportionate tax effects lodged in OCI   -    -    -    -    -    -    0.05 
    Diluted income per common share - operating  $0.55   $0.53   $0.50   $0.42   $0.41   $1.57   $1.21 
                                    
Book value per common share reconciliation                                   
Book value per common share (GAAP)  $17.56   $17.29   $17.02   $16.67   $16.50   $17.56   $16.50 
Effect of goodwill and other intangibles   (4.02)   (4.04)   (4.06)   (3.02)   (2.39)   (4.02)   (2.39)
   Tangible book value per common share  $13.54   $13.25   $12.96   $13.65   $14.11   $13.54   $14.11 
                                    
Return on tangible common equity reconciliation                                   
Return on common equity (GAAP)   11.96%   11.20%   11.11%   (3.57)%   9.22%   11.43%   9.26%
Merger-related and other charges   0.13    0.77    0.60    1.86    0.75    0.50    0.55 
Impact of tax reform on remeasurement of deferred tax asset   -    -    -    11.44    -    -    - 
Release of disproportionate tax effects lodged in OCI   -    -    -    -    -    -    0.39 
Return on common equity - operating   12.09    11.97    11.71    9.73    9.97    11.93    10.20 
Effect of goodwill and other intangibles   3.72    3.82    3.55    2.20    1.96    3.69    1.87 
    Return on tangible common equity - operating   15.81%   15.79%   15.26%   11.93%   11.93%   15.62%   12.07%
                                    
Return on assets reconciliation                                   
Return on assets (GAAP)   1.41%   1.30%   1.26%   (0.40)%   1.01%   1.32%   0.99%
Merger-related and other charges   0.01    0.09    0.07    0.20    0.08    0.06    0.06 
Impact of tax reform on remeasurement of deferred tax asset   -    -    -    1.30    -    -    - 
Release of disproportionate tax effects lodged in OCI   -    -    -    -    -    -    0.04 
    Return on assets - operating   1.42%   1.39%   1.33%   1.10%   1.09%   1.38%   1.09%
                                    
Dividend payout ratio reconciliation                                   
Dividend payout ratio (GAAP)   27.78%   30.61%   25.53%   (62.50)%   26.32%   27.81%   25.45%
Merger-related and other charges   (0.51)   (2.31)   (1.53)   12.04    (1.93)   (1.06)   (1.31)
Impact of tax reform on remeasurement of deferred tax asset   -    -    -    74.27    -    -    - 
Release of disproportionate tax effects lodged in OCI   -    -    -    -    -    -    (1.00)
    Dividend payout ratio - operating   27.27%   28.30%   24.00%   23.81%   24.39%   26.75%   23.14%
                                    
Efficiency ratio reconciliation                                   
Efficiency ratio (GAAP)   56.82%   57.94%   57.83%   63.03%   59.27%   57.52%   58.81%
Merger-related and other charges   (0.43)   (2.17)   (2.08)   (6.11)   (3.09)   (1.54)   (2.24)
    Efficiency ratio - operating   56.39%   55.77%   55.75%   56.92%   56.18%   55.98%   56.57%
                                    
Average equity to assets reconciliation                                   
Equity to assets (GAAP)   11.33%   11.21%   11.03%   11.21%   10.86%   11.19%   10.54%
Effect of goodwill and other intangibles   (2.36)   (2.38)   (2.21)   (1.69)   (1.41)   (2.31)   (1.33)
    Tangible common equity to assets   8.97%   8.83%   8.82%   9.52%   9.45%   8.88%   9.21%
                                    
Tangible common equity to risk-weighted assets reconciliation (1)                      
Tier 1 capital ratio (Regulatory)   12.34%   11.94%   11.61%   12.24%   12.27%   12.34%   12.27%
Effect of other comprehensive income   (0.68)   (0.57)   (0.50)   (0.29)   (0.13)   (0.68)   (0.13)
Effect of deferred tax limitation   0.30    0.33    0.42    0.51    0.94    0.30    0.94 
Effect of trust preferred   (0.34)   (0.34)   (0.34)   (0.36)   (0.24)   (0.34)   (0.24)
Basel III intangibles transition adjustment   -    -    -    (0.05)   (0.04)   -    (0.03)
    Tangible common equity to risk-weighted assets   11.62%   11.36%   11.19%   12.05%   12.80%   11.62%   12.81%

  

(1) Third quarter 2018 ratios are preliminary.                            

 

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UNITED COMMUNITY BANKS, INC.                    
Financial Highlights                            
Loan Portfolio Composition at Period-End                    

                             
   2018   2017   Linked   Year over 
   Third   Second   First   Fourth   Third   Quarter   Year 
(in millions)  Quarter   Quarter   Quarter   Quarter   Quarter   Change   Change 
LOANS BY CATEGORY                                   
Owner occupied commercial RE  $1,673   $1,682   $1,898   $1,924   $1,792   $(9)  $(119)
Income producing commercial RE   1,788    1,821    1,677    1,595    1,413    (33)   375 
Commercial & industrial   1,194    1,193    1,142    1,131    1,084    1    110 
Commercial construction   761    735    691    712    583    26    178 
Equipment financing   509    465    423    -    -    44    509 
     Total commercial   5,925    5,896    5,831    5,362    4,872    29    1,053 
Residential mortgage   1,035    1,021    992    974    933    14    102 
Home equity lines of credit   702    708    712    731    689    (6)   13 
Residential construction   198    195    190    183    190    3    8 
Consumer   366    400    459    486    519    (34)   (153)
     Total loans  $8,226   $8,220   $8,184   $7,736   $7,203    6    1,023 
                                    
LOANS BY MARKET                                   
North Georgia  $992   $1,001   $1,004   $1,019   $1,047    (9)   (55)
Atlanta MSA   1,493    1,533    1,513    1,510    1,477    (40)   16 
North Carolina   1,078    1,067    1,037    1,049    542    11    536 
Coastal Georgia   610    623    635    630    634    (13)   (24)
Gainesville MSA   235    230    231    248    242    5    (7)
East Tennessee   460    474    473    475    471    (14)   (11)
South Carolina   1,586    1,571    1,537    1,486    1,470    15    116 
Commercial Banking Solutions   1,530    1,444    1,438    961    920    86    610 
Indirect auto   242    277    316    358    400    (35)   (158)
     Total loans  $8,226   $8,220   $8,184   $7,736   $7,203    6    1,023 

 

 5 

 

 

UNITED COMMUNITY BANKS, INC.                                
Financial Highlights                                    
Credit Quality                                    
             
  

 

Third Quarter 2018

   Second Quarter 2018   First Quarter 2018 
   Nonperforming   Foreclosed   Total   Nonperforming   Foreclosed   Total   Nonperforming   Foreclosed   Total 
(in thousands)  Loans   Properties   NPAs   Loans   Properties   NPAs   Loans   Properties   NPAs 
NONPERFORMING ASSETS BY
CATEGORY
                          
Owner occupied CRE  $4,884   $183   $5,067   $5,772   $812   $6,584   $6,757   $1,121   $7,878 
Income producing CRE   1,194    156    1,350    991    455    1,446    3,942    368    4,310 
Commercial & industrial   1,516    -    1,516    2,180    -    2,180    1,917    -    1,917 
Commercial construction   825    522    1,347    613    576    1,189    574    658    1,232 
Equipment financing   1,181    -    1,181    1,075    -    1,075    428    -    428 
     Total commercial   9,600    861    10,461    10,631    1,843    12,474    13,618    2,147    15,765 
Residential mortgage   8,928    424    9,352    7,918    184    8,102    8,724    232    8,956 
Home equity lines of credit   2,814    -    2,814    1,812    550    2,362    2,149    335    2,484 
Residential construction   455    51    506    637    20    657    378    -    378 
Consumer   733    -    733    819    -    819    1,371    -    1,371 
     Total NPAs  $22,530   $1,336   $23,866   $21,817   $2,597   $24,414   $26,240   $2,714   $28,954 
                                              
NONPERFORMING ASSETS BY MARKET                                             
North Georgia  $7,170   $361   $7,531   $7,583   $640   $8,223   $8,519   $85   $8,604 
Atlanta MSA   1,778    132    1,910    1,928    132    2,060    1,138    132    1,270 
North Carolina   3,690    480    4,170    3,029    750    3,779    5,006    1,271    6,277 
Coastal Georgia   1,498    -    1,498    943    -    943    1,887    -    1,887 
Gainesville MSA   212    -    212    186    -    186    574    163    737 
East Tennessee   1,403    128    1,531    1,473    143    1,616    1,511    10    1,521 
South Carolina   3,280    235    3,515    3,093    362    3,455    3,443    483    3,926 
Commercial Banking Solutions   2,871    -    2,871    2,831    570    3,401    2,937    570    3,507 
Indirect auto   628    -    628    751    -    751    1,225    -    1,225 
     Total NPAs  $22,530   $1,336   $23,866   $21,817   $2,597   $24,414   $26,240   $2,714   $28,954 
                                              
NONPERFORMING ASSETS ACTIVITY                                             
Beginning Balance  $21,817   $2,597   $24,414   $26,240   $2,714   $28,954   $23,658   $3,234   $26,892 
Acquisitions   -    -    -    -    -    -    428    -    428 
Loans placed on non-accrual   5,759    -    5,759    3,612    -    3,612    7,463    -    7,463 
Payments received   (3,095)   -    (3,095)   (5,314)   -    (5,314)   (3,534)   -    (3,534)
Loan charge-offs   (1,588)   -    (1,588)   (2,065)   -    (2,065)   (1,150)   -    (1,150)
Foreclosures   (363)   454    91    (656)   984    328    (625)   625    - 
Property sales   -    (1,659)   (1,659)   -    (1,029)   (1,029)   -    (957)   (957)
Write downs   -    (166)   (166)   -    (106)   (106)   -    (72)   (72)
Net gains (losses) on sales   -    110    110    -    34    34    -    (116)   (116)
     Ending Balance  $22,530   $1,336   $23,866   $21,817   $2,597   $24,414   $26,240   $2,714   $28,954 

 

   Third Quarter 2018   Second Quarter 2018   First Quarter 2018 
       Net Charge-       Net Charge-       Net Charge- 
       Offs to       Offs to       Offs to 
   Net   Average   Net   Average   Net   Average 
(in thousands)  Charge-Offs   Loans (1)   Charge-Offs   Loans (1)   Charge-Offs   Loans (1) 
NET CHARGE-OFFS BY CATEGORY           
Owner occupied CRE  $(251)   (.06)%  $(578)   (.13)%  $(43)   (.01)%
Income producing CRE   1    -    1,421    .33    422    .10 
Commercial & industrial   418    .14    16    .01    (3)   - 
Commercial construction   (43)   (.02)   (107)   (.06)   266    .15 
Equipment financing   482    .39    (49)   (.04)   40    .08 
     Total commercial   607    .04    703    .05    682    .05 
Residential mortgage   171    .07    11    -    (52)   (.02)
Home equity lines of credit   279    .16    21    .01    89    .05 
Residential construction   (164)   (.33)   (58)   (.12)   (64)   (.14)
Consumer   573    .60    682    .64    846    .72 
     Total  $1,466    .07   $1,359    .07   $1,501    .08 
                               
NET CHARGE-OFFS BY MARKET     
North Georgia  $483    .19%  $246    .10%  $772    .31%
Atlanta MSA   99    .03    103    .03    (109)   (.03)
North Carolina   (87)   (.03)   1,268    .48    144    .06 
Coastal Georgia   24    .02    19    .01    137    .09 
Gainesville MSA   (48)   (.08)   (2)   -    (18)   (.03)
East Tennessee   (1)   -    76    .06    31    .03 
South Carolina   418    .11    (1,057)   (.27)   12    - 
Commercial Banking Solutions   403    .11    381    .11    176    .06 
Indirect auto   175    .27    325    .44    356    .41 
     Total  $1,466    .07   $1,359    .07   $1,501    .08 

 

(1)  Annualized.                                                

 

 6 

 

 

UNITED COMMUNITY BANKS, INC.                
Consolidated Statements of Income (Unaudited)                
                 
   Three Months Ended   Nine Months Ended 
   September 30,   September 30, 
(in thousands, except per share data)  2018   2017   2018   2017 
                 
Interest revenue:                    
Loans, including fees  $108,335   $80,264   $308,296   $227,816 
Investment securities, including tax exempt of $1,052, $671, $3,049, and $1,307   19,899    17,875    56,448    53,365 
Deposits in banks and short-term investments   487    700    1,482    1,782 
Total interest revenue   128,721    98,839    366,226    282,963 
                     
Interest expense:                    
Deposits:                    
NOW and interest-bearing demand   1,901    700    4,317    1,932 
Money market   3,261    1,953    8,019    4,938 
Savings   33    34    117    89 
Time   5,746    1,870    12,900    4,257 
Total deposit interest expense   10,941    4,557    25,353    11,216 
Short-term borrowings   274    36    772    177 
Federal Home Loan Bank advances   1,791    1,709    5,551    4,603 
Long-term debt   3,605    2,762    10,679    8,490 
Total interest expense   16,611    9,064    42,355    24,486 
Net interest revenue   112,110    89,775    323,871    258,477 
Provision for credit losses   1,800    1,000    7,400    2,600 
Net interest revenue after provision for credit losses   110,310    88,775    316,471    255,877 
                     
Noninterest income:                    
Service charges and fees   9,112    8,220    26,831    29,525 
Mortgage loan and other related fees   5,262    4,200    15,928    13,435 
Brokerage fees   1,525    1,009    3,598    3,565 
Gains from sales of SBA/USDA loans   2,605    2,806    6,784    7,391 
Securities gains (losses), net   2    188    (1,302)   190 
Other   5,674    4,150    18,077    12,226 
Total noninterest income   24,180    20,573    69,916    66,332 
Total revenue   134,490    109,348    386,387    322,209 
                     
Noninterest expenses:                    
Salaries and employee benefits   47,146    38,027    135,384    112,056 
Communications and equipment   5,590    4,547    15,071    14,443 
Occupancy   5,779    4,945    16,939    14,802 
Advertising and public relations   1,442    1,026    4,341    3,347 
Postage, printing and supplies   1,574    1,411    4,896    4,127 
Professional fees   3,927    2,976    11,435    8,391 
FDIC assessments and other regulatory charges   2,228    2,127    6,677    4,758 
Amortization of intangibles   1,681    1,212    5,426    3,085 
Merger-related and other charges   115    3,176    4,449    7,060 
Other   8,236    6,227    23,425    19,660 
Total noninterest expenses   77,718    65,674    228,043    191,729 
    Net income before income taxes   56,772    43,674    158,344    130,480 
Income tax expense   13,090    15,728    37,370    50,743 
Net income  $43,682   $27,946   $120,974   $79,737 
                     
Net income available to common shareholders  $43,381   $27,719   $120,124   $79,078 
                     
Earnings per common share:                    
     Basic  $0.54   $0.38   $1.51   $1.10 
     Diluted   0.54    0.38    1.51    1.10 
Weighted average common shares outstanding:                    
     Basic   79,806    73,151    79,588    72,060 
     Diluted   79,818    73,162    79,598    72,071 

 

 7 

 

 

UNITED COMMUNITY BANKS, INC.        
Consolidated Balance Sheets (Unaudited)        
         
   September 30,   December 31, 
(in thousands, except share and per share data)  2018   2017 
         
ASSETS          
  Cash and due from banks  $115,509   $129,108 
  Interest-bearing deposits in banks   196,459    185,167 
      Cash and cash equivalents   311,968    314,275 
  Securities available for sale   2,587,559    2,615,850 
  Securities held to maturity (fair value $277,473 and $321,276)   285,739    321,094 
  Loans held for sale (includes $27,325 and $26,252 at fair value)   27,325    32,734 
  Loans and leases, net of unearned income   8,226,466    7,735,572 
       Less allowance for loan and lease losses   (60,940)   (58,914)
              Loans, net   8,165,526    7,676,658 
  Premises and equipment, net   204,080    208,852 
  Bank owned life insurance   191,582    188,970 
  Accrued interest receivable   33,562    32,459 
  Net deferred tax asset   76,944    88,049 
  Derivative financial instruments   29,895    22,721 
  Goodwill and other intangible assets   325,493    244,397 
  Other assets   165,459    169,401 
      Total assets  $12,405,132   $11,915,460 
LIABILITIES AND SHAREHOLDERS' EQUITY          
Liabilities:          
  Deposits:          
       Noninterest-bearing demand  $3,296,908   $3,087,797 
       NOW and interest-bearing demand   2,075,479    2,131,939 
       Money market   2,060,671    2,016,748 
       Savings   680,421    651,742 
       Time   1,564,640    1,548,460 
       Brokered   551,358    371,011 
                     Total deposits   10,229,477    9,807,697 
   Short-term borrowings   -    50,000 
   Federal Home Loan Bank advances   300,000    504,651 
   Long-term debt   285,128    120,545 
   Derivative financial instruments   39,116    25,376 
   Accrued expenses and other liabilities   149,529    103,857 
        Total liabilities   11,003,250    10,612,126 
Shareholders' equity:          
    Common stock, $1 par value; 150,000,000 shares authorized;          
        79,202,479 and 77,579,561 shares issued and outstanding   79,202    77,580 
    Common stock issuable; 650,338 and 607,869 shares   10,171    9,083 
    Capital surplus   1,498,199    1,451,814 
    Accumulated deficit   (122,679)   (209,902)
    Accumulated other comprehensive loss   (63,011)   (25,241)
        Total shareholders' equity   1,401,882    1,303,334 
        Total liabilities and shareholders' equity  $12,405,132   $11,915,460 

 

 8 

 

 

UNITED COMMUNITY BANKS, INC.                        
Average Consolidated Balance Sheets and Net Interest Analysis                
For the Three Months Ended September 30,                        
                         
   2018   2017 
   Average       Avg.   Average       Avg. 
(dollars in thousands, fully taxable equivalent (FTE))  Balance   Interest   Rate   Balance   Interest   Rate 
Assets:                              
Interest-earning assets:                              
  Loans, net of unearned income (FTE) (1)(2)  $8,199,856   $108,197    5.23%  $7,149,348   $80,301    4.46%
  Taxable securities (3)   2,763,461    18,847    2.73    2,695,162    17,204    2.55 
  Tax-exempt securities (FTE) (1)(3)   152,939    1,417    3.71    105,151    1,098