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United Community Banks, Inc. Reports First Quarter Results

EPS of $0.82, Return on Assets of 1.62% and Return on Common Equity of 15.4%

/EIN News/ -- GREENVILLE, S.C., April 20, 2021 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ: UCBI) (United) today announced that net income for the first quarter reached a record $73.7 million and pre-tax, pre-provision income was $81.6 million. The quarter benefited from an allowance release of $12.3 million, as economic conditions and forecasts continue to improve. Diluted earnings per share of $0.82 for the quarter represented an increase of $0.42 or 105%, from the first quarter a year ago, and represented an increase of $0.16 or 24% over the fourth quarter of 2020. On an operating basis, United’s diluted earnings per share of $0.83 was an increase of 102% over the year ago quarter. United’s GAAP return on assets (ROA) was 1.62% and its return on common equity was 15.4% for the quarter. On an operating basis, United’s ROA was 1.65% and its return on tangible common equity was 19.7%. On a pre-tax, pre-provision basis, return on assets was 1.83% for the quarter.

Chairman and CEO Lynn Harton stated, “We continue to have strong performance across our businesses and markets, driven by an improving economy, southeastern markets that are outperforming national averages, and great execution by our bankers. Loan growth, while slower than the previous two quarters, continues to be positive and deposit growth continues at a strong pace. Credit results were outstanding and we believe the record stimulus, strong liquidity levels of consumers and businesses, and pent up demand has the potential to deliver strong economic growth for several quarters.”

Total loans increased by $308 million during the quarter—impacted by a $237 million increase in SBA Paycheck Protection Program (PPP) loans. During the quarter, United funded nearly 5,100 loans totaling $518 million, and had $311 million in PPP loans forgiven. Excluding the effect of PPP loans, core organic loan growth was 3% annualized. Core transaction deposits grew by $948 million during the quarter, or 33% annualized, and United’s cost of deposits decreased by 3 basis points to 0.14%. The net interest margin decreased by 33 basis points from the fourth quarter due mainly to a $9.5 million decline in the recognition of PPP fees, as well as $1.8 million less purchased loan accretion. Excluding these items, the net interest margin decreased by approximately 7 basis points from the fourth quarter due to a combination of factors, including lower overall market rates and increased liquidity.

Mr. Harton concluded, “We are excited about the ongoing opportunities in our markets and look forward to the rest of 2021. I also want to recognize our entire team for their performance. Earlier this quarter, Forbes recognized United on its 2021 list of the 100 Best Banks in America for the eighth consecutive year. Forbes’ ranks the banks based on growth, credit quality and profitability and United was again a standout. I am incredibly proud of our employees who make this type of recognition possible through their tireless dedication to our customers, our culture and fulfilling our performance mission.”

First Quarter 2021 Financial Highlights:

  • Net income of $73.7 million and pre-tax, pre-provision income of $81.6 million
  • EPS increased by 105% compared to last year on a GAAP basis and 102% on an operating basis; compared to fourth quarter 2020, EPS increased by 24% on a GAAP basis and 22% on an operating basis
  • Return on assets of 1.62%, or 1.65% on an operating basis
  • Pre-tax, pre-provision return on assets of 1.80%, or 1.83% on an operating basis
  • Return on common equity of 15.4%
  • Return on tangible common equity of 19.7% on an operating basis
  • A release of provision for credit losses of $12.3 million, which reduced the allowance for loan losses to 1.09% (1.18%, excluding PPP loans) from 1.20% in the fourth quarter
  • Loan production of $1.5 billion, resulting in core loan growth of 3%, annualized for the quarter, excluding the impact of $518 million in new PPP loans and $311 million in PPP loans being forgiven
  • Core transaction deposits were up $948 million, which represents a 33% annualized growth rate for the quarter
  • Net interest margin of 3.22% was down 33 basis points from the fourth quarter, mainly due to the impact of accelerated PPP fees during the fourth quarter
  • Record mortgage closings of $666 million and mortgage rate locks of $993 million, compared to $388 million and $801 million, respectively, a year ago
  • Noninterest income was up $3.3 million on a linked quarter basis, primarily driven by higher mortgage loan gains and related fees
  • Noninterest expenses decreased by $11.3 million compared to the fourth quarter mostly due to funding for the United Community Bank Foundation of $8.5 million in the fourth quarter
  • Efficiency ratio of 53.6%, or 52.7% on an operating basis
  • Net recoveries of $305,000, or one basis point as a percent of average loans, down 6 basis points from the fourth quarter
  • Nonperforming assets of 0.30% of total assets, down 5 basis points compared to December 31, 2020
  • Total loan deferrals of $48 million or 0.4% of the total loan portfolio compared to $71 million or 0.6% in the fourth quarter
  • Quarterly common shareholder dividend of $0.19 per share declared during the quarter, an increase of 6% year-over-year
  • Successfully completed the operational conversion of Seaside during the quarter

Conference Call

United will hold a conference call on Wednesday, April 21, 2021, 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 9792368. 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.

UNITED COMMUNITY BANKS, INC.
Selected Financial Information

    2021   2020   First Quarter
2021 - 2020
Change
(in thousands, except per share data)   First
Quarter
  Fourth
Quarter
  Third
Quarter
  Second
Quarter
  First
Quarter
 
INCOME SUMMARY                        
Interest revenue   $ 141,542       $ 156,071       $ 141,773       $ 123,605       $ 136,547        
Interest expense   9,478       10,676       13,319       14,301       17,941        
Net interest revenue   132,064       145,395       128,454       109,304       118,606       11 %
(Release of) provision for credit losses   (12,281 )     2,907       21,793       33,543       22,191        
Noninterest income   44,705       41,375       48,682       40,238       25,814       73  
Total revenue   189,050       183,863       155,343       115,999       122,229       55  
Expenses   95,194       106,490       95,981       83,980       81,538       17  
Income before income tax expense   93,856       77,373       59,362       32,019       40,691       131  
Income tax expense   20,150       17,871       11,755       6,923       8,807       129  
Net income   73,706       59,502       47,607       25,096       31,884       131  
Merger-related and other charges   1,543       2,452       3,361       397       808        
Income tax benefit of merger-related and other charges   (335 )     (552 )     (519 )     (87 )     (182 )      
Net income - operating (1)   $ 74,914       $ 61,402       $ 50,449       $ 25,406       $ 32,510       130  
                         
Pre-tax pre-provision income (5)   $ 81,575       $ 80,280       $ 81,155       $ 65,562       $ 62,882       30  
                         
PERFORMANCE MEASURES                        
Per common share:                        
Diluted net income - GAAP   $ 0.82       $ 0.66       $ 0.52       $ 0.32       $ 0.40       105  
Diluted net income - operating (1)   0.83       0.68       0.55       0.32       0.41       102  
Cash dividends declared   0.19       0.18       0.18       0.18       0.18       6  
Book value   22.15       21.90       21.45       21.22       20.80       6  
Tangible book value (3)   17.83       17.56       17.09       16.95       16.52       8  
Key performance ratios:                        
Return on common equity - GAAP (2)(4)   15.37   %   12.36   %   10.06   %   6.17   %   7.85   %    
Return on common equity - operating (1)(2)(4)   15.63       12.77       10.69       6.25       8.01        
Return on tangible common equity - operating (1)(2)(3)(4)   19.68       16.23       13.52       8.09       10.57        
Return on assets - GAAP (4)   1.62       1.30       1.07       0.71       0.99        
Return on assets - operating (1)(4)   1.65       1.34       1.14       0.72       1.01        
Return on assets - pre-tax pre-provision (4)(5)   1.80       1.77       1.86       1.86       1.95        
Return on assets - pre-tax pre-provision, excluding merger-related and other charges (1)(4)(5)   1.83       1.82       1.93       1.87       1.98        
Net interest margin (fully taxable equivalent) (4)   3.22       3.55       3.27       3.42       4.07        
Efficiency ratio - GAAP   53.55       56.73       54.14       55.86       56.15        
Efficiency ratio - operating (1)   52.68       55.42       52.24       55.59       55.59        
Equity to total assets   10.95       11.29       11.47       11.81       12.54        
Tangible common equity to tangible assets (3)   8.57       8.81       8.89       9.12       10.22        
                         
ASSET QUALITY                        
Nonperforming loans   $ 55,900       $ 61,599       $ 49,084       $ 48,021       $ 36,208       54  
Foreclosed properties   596       647       953       477       475        
Total nonperforming assets ("NPAs")   56,496       62,246       50,037       48,498       36,683       54  
Allowance for credit losses - loans   126,866       137,010       134,256       103,669       81,905       55  
Net charge-offs   (305 )     1,515       2,538       6,149       8,114        
Allowance for credit losses - loans to loans   1.09   %   1.20   %   1.14   %   1.02   %   0.92   %    
Net charge-offs to average loans (4)   (0.01 )     0.05       0.09       0.25       0.37        
NPAs to loans and foreclosed properties   0.48       0.55       0.42       0.48       0.41        
NPAs to total assets   0.30       0.35       0.29       0.32       0.28        
                         
AVERAGE BALANCES ($ in millions)                        
Loans   $ 11,433       $ 11,595       $ 11,644       $ 9,773       $ 8,829       29  
Investment securities   3,991       3,326       2,750       2,408       2,520       58  
Earning assets   16,782       16,394       15,715       12,958       11,798       42  
Total assets   18,023       17,698       17,013       14,173       12,944       39  
Deposits   15,366       15,057       14,460       12,071       10,915       41  
Shareholders’ equity   2,025       1,994       1,948       1,686       1,653       23  
Common shares - basic (thousands)   87,322       87,258       87,129       78,920       79,340       10  
Common shares - diluted (thousands)   87,466       87,333       87,205       78,924       79,446       10  
                         
AT PERIOD END ($ in millions)                        
Loans   $ 11,679       $ 11,371       $ 11,799       $ 10,133       $ 8,935       31  
Investment securities   4,332       3,645       3,089       2,432       2,540       71  
Total assets   18,557       17,794       17,153       15,005       13,086       42  
Deposits   15,993       15,232       14,603       12,702       11,035       45  
Shareholders’ equity   2,031       2,008       1,967       1,772       1,641       24  
Common shares outstanding (thousands)   86,777       86,675       86,611       78,335       78,284       11  

(1) Excludes merger-related and other charges. (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) Excludes income tax expense and provision for credit losses.

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

    2021   2020
(in thousands, except per share data)   First
Quarter
  Fourth
Quarter
  Third
Quarter
  Second
Quarter
  First
Quarter
                     
Expense reconciliation                    
Expenses (GAAP)   $ 95,194       $ 106,490       $ 95,981       $ 83,980       $ 81,538    
Merger-related and other charges   (1,543 )     (2,452 )     (3,361 )     (397 )     (808 )  
Expenses - operating   $ 93,651       $ 104,038       $ 92,620       $ 83,583       $ 80,730    
                     
Net income reconciliation                    
Net income (GAAP)   $ 73,706       $ 59,502       $ 47,607       $ 25,096       $ 31,884    
Merger-related and other charges   1,543       2,452       3,361       397       808    
Income tax benefit of merger-related and other charges   (335 )     (552 )     (519 )     (87 )     (182 )  
Net income - operating   $ 74,914       $ 61,402       $ 50,449       $ 25,406       $ 32,510    
                     
Net income to pre-tax pre-provision income reconciliation                    
Net income (GAAP)   $ 73,706       $ 59,502       $ 47,607       $ 25,096       $ 31,884    
Income tax expense   20,150       17,871       11,755       6,923       8,807    
(Release of) provision for credit losses   (12,281 )     2,907       21,793       33,543       22,191    
Pre-tax pre-provision income   $ 81,575       $ 80,280       $ 81,155       $ 65,562       $ 62,882    
                     
Diluted income per common share reconciliation                    
Diluted income per common share (GAAP)   $ 0.82       $ 0.66       $ 0.52       $ 0.32       $ 0.40    
Merger-related and other charges, net of tax   0.01       0.02       0.03             0.01    
Diluted income per common share - operating   $ 0.83       $ 0.68       $ 0.55       $ 0.32       $ 0.41    
                     
Book value per common share reconciliation                    
Book value per common share (GAAP)   $ 22.15       $ 21.90       $ 21.45       $ 21.22       $ 20.80    
Effect of goodwill and other intangibles   (4.32 )     (4.34 )     (4.36 )     (4.27 )     (4.28 )  
Tangible book value per common share   $ 17.83       $ 17.56       $ 17.09       $ 16.95       $ 16.52    
                     
Return on tangible common equity reconciliation                    
Return on common equity (GAAP)   15.37   %   12.36   %   10.06   %   6.17   %   7.85   %
Merger-related and other charges, net of tax   0.26       0.41       0.63       0.08       0.16    
Return on common equity - operating   15.63       12.77       10.69       6.25       8.01    
Effect of goodwill and other intangibles   4.05       3.46       2.83       1.84       2.56    
Return on tangible common equity - operating   19.68   %   16.23   %   13.52   %   8.09   %   10.57   %
                     
Return on assets reconciliation                    
Return on assets (GAAP)   1.62   %   1.30   %   1.07   %   0.71   %   0.99   %
Merger-related and other charges, net of tax   0.03       0.04       0.07       0.01       0.02    
Return on assets - operating   1.65   %   1.34   %   1.14   %   0.72   %   1.01   %
                     
Return on assets to return on assets- pre-tax pre-provision reconciliation                    
Return on assets (GAAP)   1.62   %   1.30   %   1.07   %   0.71   %   0.99   %
Income tax expense   0.46       0.40       0.28       0.20       0.27    
(Release of) provision for credit losses   (0.28 )     0.07       0.51       0.95       0.69    
Return on assets - pre-tax, pre-provision   1.80       1.77       1.86       1.86       1.95    
Merger-related and other charges   0.03       0.05       0.07       0.01       0.03    
Return on assets - pre-tax pre-provision, excluding merger-related and other charges   1.83   %   1.82   %   1.93   %   1.87   %   1.98   %
                     
Efficiency ratio reconciliation                    
Efficiency ratio (GAAP)   53.55   %   56.73   %   54.14   %   55.86   %   56.15   %
Merger-related and other charges   (0.87 )     (1.31 )     (1.90 )     (0.27 )     (0.56 )  
Efficiency ratio - operating   52.68   %   55.42   %   52.24   %   55.59   %   55.59   %
                     
Tangible common equity to tangible assets reconciliation                    
Equity to total assets (GAAP)   10.95   %   11.29   %   11.47   %   11.81   %   12.54   %
Effect of goodwill and other intangibles   (1.86 )     (1.94 )     (2.02 )     (2.05 )     (2.32 )  
Effect of preferred equity   (0.52 )     (0.54 )     (0.56 )     (0.64 )        
Tangible common equity to tangible assets   8.57   %   8.81   %   8.89   %   9.12   %   10.22   %


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

  2021   2020   Linked
Quarter
Change
  Year over
Year
Change
(in millions) First
Quarter
  Fourth
Quarter
  Third
Quarter
  Second
Quarter
  First
Quarter
   
LOANS BY CATEGORY                          
Owner occupied commercial RE $ 2,107     $ 2,090     $ 2,009     $ 1,759     $ 1,703     $ 17       $ 404    
Income producing commercial RE 2,599     2,541     2,493     2,178     2,065     58       534    
Commercial & industrial 1,760     1,853     1,788     1,219     1,310     (93 )     450    
Paycheck protection program 883     646     1,317     1,095         237       883    
Commercial construction 960     967     987     946     959     (7 )     1    
Equipment financing 913     864     823     779     761     49       152    
Total commercial 9,222     8,961     9,417     7,976     6,798     261       2,424    
Residential mortgage 1,362     1,285     1,270     1,152     1,128     77       234    
Home equity lines of credit 679     697     707     654     668     (18 )     11    
Residential construction 272     281     257     230     216     (9 )     56    
Consumer 144     147     148     121     125     (3 )     19    
Total loans $ 11,679     $ 11,371     $ 11,799     $ 10,133     $ 8,935     $ 308       $ 2,744    
                           
LOANS BY MARKET (1)                          
North Georgia $ 982     $ 955     $ 945     $ 951     $ 958     $ 27       $ 24    
Atlanta 1,953     1,889     1,853     1,852     1,820     64       133    
North Carolina 1,326     1,281     1,246     1,171     1,124     45       202    
Coastal Georgia 597     617     614     618     604     (20 )     (7 )  
Gainesville 222     224     229     233     235     (2 )     (13 )  
East Tennessee 398     415     420     433     425     (17 )     (27 )  
South Carolina 1,997     1,947     1,870     1,778     1,774     50       223    
Florida 1,160     1,435     1,453             (275 )     1,160    
Commercial Banking Solutions 3,044     2,608     3,169     3,097     1,995     436       1,049    
Total loans $ 11,679     $ 11,371     $ 11,799     $ 10,133     $ 8,935     $ 308       $ 2,744    

(1) Certain loans previously included in the Florida geographic market have been reclassified to Commercial Banking Solutions following Seaside’s core systems conversion in the first quarter of 2021.

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality

    2021   2020            
(in thousands)   First
Quarter
  Fourth
Quarter
  Third
Quarter
           
NONACCRUAL LOANS                        
Owner occupied RE   $ 7,908     $ 8,582     $ 11,075              
Income producing RE   13,740     15,149     12,230              
Commercial & industrial   13,864     16,634     3,534              
Commercial construction   1,984     1,745     1,863              
Equipment financing   2,171     3,405     3,137              
Total commercial   39,667     45,515     31,839              
Residential mortgage   14,050     12,858     13,864              
Home equity lines of credit   1,707     2,487     2,642              
Residential construction   322     514     479              
Consumer   154     225     260              
Total   $ 55,900     $ 61,599     $ 49,084              


    2021   2020
    First Quarter   Fourth Quarter   Third Quarter
(in thousands)   Net Charge-Offs   Net Charge-Offs to Average Loans (1)   Net Charge-Offs   Net Charge-Offs to Average Loans (1)   Net Charge-Offs   Net Charge-Offs to Average Loans (1)
NET CHARGE-OFFS BY CATEGORY                        
Owner occupied RE   $ (240 )     (0.05 ) %   $ (277 )     (0.05 ) %   $ (725 )     (0.14 ) %
Income producing RE   991       0.16       (1,718 )     (0.27 )     1,785       0.29    
Commercial & industrial   (2,753 )     (0.44 )     2,294       0.33       (105 )     (0.01 )  
Commercial construction   22       0.01       (129 )     (0.05 )     (171 )     (0.07 )  
Equipment financing   1,511       0.70       1,595       0.75       1,993       0.93    
Total commercial   (469 )     (0.02 )     1,765       0.08       2,777       0.12    
Residential mortgage   92       0.03       (25 )     (0.01 )     (35 )     (0.01 )  
Home equity lines of credit   (73 )     (0.04 )     (151 )     (0.09 )     (125 )     (0.07 )  
Residential construction   (60 )     (0.09 )     (47 )     (0.07 )              
Consumer   205       0.58       (27 )     (0.07 )     (79 )     (0.22 )  
Total   $ (305 )     (0.01 )     $ 1,515       0.05       $ 2,538       0.09    
                         
(1) Annualized.                        


UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheets (Unaudited)

(in thousands, except share and per share data)   March 31,
2021
  December 31,
2020
ASSETS        
Cash and due from banks   $ 126,164       $ 148,896    
Interest-bearing deposits in banks   1,207,949       1,459,723    
Cash and cash equivalents   1,334,113       1,608,619    
Debt securities available-for-sale   3,744,280       3,224,721    
Debt securities held-to-maturity (fair value $586,828 and $437,193)   587,696       420,361    
Loans held for sale at fair value   164,979       105,433    
Loans and leases held for investment   11,678,544       11,370,815    
Less allowance for credit losses - loans and leases   (126,866 )     (137,010 )  
Loans and leases, net   11,551,678       11,233,805    
Premises and equipment, net   216,752       218,489    
Bank owned life insurance   202,817       201,969    
Accrued interest receivable   46,278       47,672    
Net deferred tax asset   39,338       38,411    
Derivative financial instruments   63,897       86,666    
Goodwill and other intangible assets, net   380,838       381,823    
Other assets   224,242       226,405    
Total assets   $ 18,556,908       $ 17,794,374    
LIABILITIES AND SHAREHOLDERS' EQUITY        
Liabilities:        
Deposits:        
Noninterest-bearing demand   $ 6,058,439       $ 5,390,291    
NOW and interest-bearing demand   3,417,915       3,346,490    
Money market   3,677,630       3,550,335    
Savings   1,051,381       950,854    
Time   1,587,653       1,704,290    
Brokered   200,202       290,098    
Total deposits   15,993,220       15,232,358    
Long-term debt   311,591       326,956    
Derivative financial instruments   33,455       29,003    
Accrued expenses and other liabilities   187,558       198,527    
Total liabilities   16,525,824       15,786,844    
Shareholders' equity:        
Preferred stock; $1 par value; 10,000,000 shares authorized;
Series I, $25,000 per share liquidation preference; 4,000 shares issued and outstanding
  96,422       96,422    
Common stock, $1 par value; 150,000,000 shares authorized;
86,776,508 and 86,675,279 shares issued and outstanding
  86,777       86,675    
Common stock issuable; 565,904 and 600,834 shares   10,485       10,855    
Capital surplus   1,640,583       1,638,999    
Retained earnings   192,185       136,869    
Accumulated other comprehensive income   4,632       37,710    
Total shareholders' equity   2,031,084       2,007,530    
Total liabilities and shareholders' equity   $ 18,556,908       $ 17,794,374    


UNITED COMMUNITY BANKS, INC.
Consolidated Statements of Income (Unaudited)

    Three Months Ended
March 31,
(in thousands, except per share data)   2021   2020
Interest revenue:        
Loans, including fees   $ 125,726       $ 118,063  
Investment securities, including tax exempt of $2,150 and $1,523, respectively   15,448       17,394  
Deposits in banks and short-term investments   368       1,090  
Total interest revenue   141,542       136,547  
         
Interest expense:        
Deposits:        
NOW and interest-bearing demand   1,486       2,978  
Money market   1,804       4,531  
Savings   49       35  
Time   1,880       7,531  
Deposits   5,219       15,075  
Short-term borrowings         1  
Federal Home Loan Bank advances   2       1  
Long-term debt   4,257       2,864  
Total interest expense   9,478       17,941  
Net interest revenue   132,064       118,606  
(Release of) provision for credit losses   (12,281 )     22,191  
Net interest revenue after provision for credit losses   144,345       96,415  
         
Noninterest income:        
Service charges and fees   7,570       8,638  
Mortgage loan gains and other related fees   22,572       8,310  
Wealth management fees   3,505       1,640  
Gains from sales of other loans, net   1,030       1,674  
Other   10,028       5,552  
Total noninterest income   44,705       25,814  
Total revenue   189,050       122,229  
         
Noninterest expenses:        
Salaries and employee benefits   60,585       51,358  
Communications and equipment   7,203       5,946  
Occupancy   6,956       5,714  
Advertising and public relations   1,199       1,274  
Postage, printing and supplies   1,822       1,670  
Professional fees   4,234       4,097  
Lending and loan servicing expense   2,877       2,293  
Outside services - electronic banking   2,218       1,832  
FDIC assessments and other regulatory charges   1,896       1,484  
Amortization of intangibles   985       1,040  
Merger-related and other charges   1,543       808  
Other   3,676       4,022  
Total noninterest expenses   95,194       81,538  
Net income before income taxes   93,856       40,691  
Income tax expense   20,150       8,807  
Net income   73,706       31,884  
Preferred stock dividends   1,719        
Undistributed earnings allocated to participating securities   462       243  
Net income available to common shareholders   $ 71,525       $ 31,641  
         
Net income per common share:        
Basic   $ 0.82       $ 0.40  
Diluted   0.82       0.40  
Weighted average common shares outstanding:        
Basic   87,322       79,340  
Diluted   87,466       79,446  


Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended March 31,
         
    2021   2020
(dollars in thousands, fully taxable equivalent (FTE))   Average
Balance
  Interest   Average
Rate
  Average
Balance
  Interest   Average
Rate
Assets:                        
Interest-earning assets:                        
Loans, net of unearned income (FTE) (1)(2)   $ 11,432,908       $ 125,122     4.44 %   $ 8,828,880       $ 117,796     5.37 %
Taxable securities (3)   3,686,405       13,298     1.44     2,357,635       15,871     2.69  
Tax-exempt securities (FTE) (1)(3)   304,983       2,888     3.79     162,253       2,045     5.04  
Federal funds sold and other interest-earning assets   1,357,890       1,222     0.36     448,775       1,632     1.46  
Total interest-earning assets (FTE)   16,782,186       142,530     3.44     11,797,543       137,344     4.68  
                         
Noninterest-earning assets:                        
Allowance for credit losses   (143,703 )             (69,777 )          
Cash and due from banks   140,292               128,254            
Premises and equipment   221,411               219,243            
Other assets (3)   1,023,275               868,452            
Total assets   $ 18,023,461               $ 12,943,715            
                         
Liabilities and Shareholders' Equity:                        
Interest-bearing liabilities:                        
Interest-bearing deposits:                        
NOW and interest-bearing demand   $ 3,331,043       1,486     0.18     $ 2,412,733       2,978     0.50  
Money market   3,732,988       1,804     0.20     2,340,723       4,531     0.78  
Savings   989,584       49     0.02     712,110       35     0.02  
Time   1,642,423       1,588     0.39     1,841,552       7,250     1.58  
Brokered time deposits   75,259       292     1.57     80,821       281     1.40  
Total interest-bearing deposits   9,771,297       5,219     0.22     7,387,939       15,075     0.82  
Federal funds purchased and other borrowings   12               396       1     1.02  
Federal Home Loan Bank advances   3,333       2     0.24     165       1     2.44  
Long-term debt   317,172       4,257     5.44     212,762       2,864     5.41  
Total borrowed funds   320,517       4,259     5.39     213,323       2,866     5.40  
Total interest-bearing liabilities   10,091,814       9,478     0.38     7,601,262       17,941     0.95  
                         
Noninterest-bearing liabilities:                        
Noninterest-bearing deposits   5,594,394               3,527,385            
Other liabilities   312,610               162,187            
Total liabilities   15,998,818               11,290,834            
Shareholders' equity   2,024,643               1,652,881            
Total liabilities and shareholders' equity   $ 18,023,461               $ 12,943,715            
                         
Net interest revenue (FTE)       $ 133,052             $ 119,403      
Net interest-rate spread (FTE)           3.06 %           3.73 %
Net interest margin (FTE) (4)           3.22 %           4.07 %


(1) Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2) Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
(3) Securities available for sale are shown at amortized cost. Pretax unrealized gains of $58.3 million and $52.9 million in 2021 and 2020, respectively, are included in other assets for purposes of this presentation.
(4) Net interest margin is taxable equivalent net interest revenue divided by average interest-earning assets.
   

About United Community Banks, Inc.

United Community Banks, Inc. (NASDAQ: UCBI) (United) provides a full range of banking, wealth management and mortgage services for relationship oriented consumers and business owners. The company, known as “The Bank That Service Built” has been recognized by JD Power, Forbes, and CSP for having outstanding customer service ratings for many years. United has $18.6 billion in assets and 161 offices in Florida, Georgia, North Carolina, South Carolina and Tennessee along with a national SBA lending franchise and a national equipment lending subsidiary. In 2020, J.D. Power ranked United highest in customer satisfaction with retail banking in the Southeast, marking six out of the last seven years United earned the coveted award. United was also named "Best Banks to Work For" by American Banker in 2020 for the fourth year in a row based on employee satisfaction. Forbes included United in its inaugural list of the World’s Best Banks in 2019 and again in 2020. Forbes also recognized United on its 2021 list of the 100 Best Banks in America for the eighth consecutive year. United also received five Greenwich Excellence Awards in 2020 for excellence in Small Business Banking, including a national award for Overall Satisfaction. Additional information about United can be found at www.ucbi.com.

Non-GAAP Financial Measures

This press release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP. This financial information includes certain operating performance measures, which exclude merger-related and other charges that are not considered part of recurring operations, such as “operating net income,” “pre-tax, pre-provision income,” “operating net income per diluted common share,” “operating earnings per share,” “tangible book value per common share,” “operating return on common equity,” “operating return on tangible common equity,” “operating return on assets,” “return on assets - pre-tax, pre-provision, excluding merger-related and other charges,” “return on assets - pre-tax, pre-provision,” “operating efficiency ratio,” and “tangible common equity to tangible assets.” These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United’s underlying performance trends. These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.

For more information:

Jefferson Harralson
Chief Financial Officer
(864) 240-6208
Jefferson_Harralson@ucbi.com


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