GREENVILLE, S.C., April 24, 2024 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ: UCBI) (United) today announced that net income for the first quarter was $62.6 million and pre-tax, pre-provision income was $93.7 million. Diluted earnings per share of $0.51 for the quarter represented a decrease of $0.01 or 2%, from the first quarter a year ago and an increase of $0.40 from the fourth quarter of 2023, during which merger charges, losses from a bond portfolio restructuring, and an FDIC special assessment had a significant negative impact on earnings.
On an operating basis, diluted earnings per share of $0.52 were slightly lower compared to last quarter, with the primary drivers of the decrease being a seasonal increase in certain operating expenses and a higher effective tax rate, as well as a lower day count. These were offset by a favorable MSR asset write-up and lower provision expense. Core deposits, excluding brokered deposits and public funds, grew by 5% annualized and loans grew at a 1.2% annualized rate during the quarter. Net interest revenue was lower by 2% during the quarter despite an increase in average loan balances, as lower average interest-earning assets and a lower day count offset the effect of a higher margin.
For the first quarter, United's return on assets was 0.90% and 0.93% on an operating basis. Return on equity was 7.14% and return on tangible common equity was 10.68%. On a pre-tax, pre-provision basis, operating return on assets was 1.40% for the quarter. At quarter-end, tangible common equity to tangible assets was 8.49%, up 13 basis points from the fourth quarter of 2023.
Chairman and CEO Lynn Harton stated, "We reported solid results in the first quarter, with strong pre-tax, pre-provision earnings, a stable margin, and good credit performance. Loan growth slowed as expected while core deposit growth was stronger than we anticipated." Harton continued "Economic conditions in our markets continue to be very positive. However, we are mindful of the uncertainties in the environment, such as continuing inflation, the tension between a very tight monetary policy and a very loose fiscal policy, and ongoing global conflicts. Given those uncertainties, we continue to manage conservatively so that we can remain a source of strength for our communities and customers."
United's net interest margin increased by 1 basis point to 3.20% from the fourth quarter. Interest-earning assets were modestly lower and the average yield on United's interest-earning assets was up 8 basis points to 5.39%, and its cost of interest-bearing liabilities increased by 7 basis points to 3.23%, contributing to the increase in the net interest margin. Cost of deposits, including non-interest-bearing deposits was 2.32%. Net charge-offs were $12.9 million or 0.28% of average loans during the quarter, up 6 basis points compared to the fourth quarter of 2023, and NPAs were 39 basis points relative to total assets, up 5 basis points from the previous quarter.
Mr. Harton concluded, "We approach 2024 with continued optimism given the strength of our company, driven by an outstanding team of employees. In the first quarter, we became a 10-time winner of the JD Power Award for Best Retail Banking Satisfaction in the Southeast. We also received 15 Greenwich Excellence Awards for Small Business Banking. These awards reflect the passion and skill that our teams exhibit every day in the quest to serve our customers in the best way possible."
First Quarter 2024 Financial Highlights:
- Net income of $62.6 million and pre-tax, pre-provision income of $93.7 million
- EPS decreased by 2% compared to first quarter 2023 on a GAAP basis and 10% on an operating basis; compared to fourth quarter 2023, EPS increased 364% on a GAAP basis and decreased 2% on an operating basis
- Return on assets of 0.90%, or 0.93% on an operating basis
- Pre-tax, pre-provision return on assets of 1.40% on an operating basis
- Return on common equity of 7.14%
- Return on tangible common equity of 10.68% on an operating basis
- A provision for credit losses of $12.9 million, which increased the allowance for loan losses to 1.15% of loans from 1.14% in the fourth quarter
- Loan production of $881 million, resulting in loan growth of 1.2% annualized for the quarter
- Core deposits, excluding brokered deposits and public funds, grew by 5% annualized
- Net interest margin of 3.20% increased by 1 basis point from the fourth quarter
- Mortgage closings of $171 million compared to $225 million a year ago; mortgage rate locks of $260 million compared to $335 million a year ago
- Noninterest income was up $62.7 million on a linked quarter basis, primarily driven by the $51.7 million bond portfolio restructuring charge in the fourth quarter. Mortgage Loan and Related Fees were $7.5 million, which was $5.6 million higher compared to the fourth quarter, largely attributable to a favorable mortgage servicing rights asset write-up compared to a write-down last quarter
- Noninterest expenses decreased by $9.6 million compared to the fourth quarter due to lower non-operating charges including merger-related charges and the FDIC special assessment
- Efficiency ratio of 60.5%, or 59.2% on an operating basis
- Net charge-offs of $12.9 million, or 28 basis points as a percent of average loans, up 6 basis points from the net charge-offs level experienced in the fourth quarter
- Nonperforming assets of 0.39% of total assets, up 5 basis points compared to December 31, 2023
- Quarterly common shareholder dividend of $0.23 per share declared during the quarter, which was flat year-over-year
Conference Call
United will hold a conference call on Wednesday, April 24, 2024, at 11 a.m. ET to discuss the contents of this press release and to share business highlights for the quarter. Participants can pre-register for the conference call by navigating to https://dpregister.com/sreg/10187792/fc12c215d0. Those without internet access or unable to pre-register may dial in by calling 1-866-777-2509. Participants are encouraged to dial in 15 minutes prior to the call start time. The conference call also will be webcast and can be accessed by selecting "Events and Presentations" under "News and Events" within the Investor Relations section of the company's website, www.ucbi.com.
| UNITED COMMUNITY BANKS, INC. | |||||||||||||
| Selected Financial Information | |||||||||||||
| (in thousands, except per share data) | |||||||||||||
| 2024 | 2023 | First Quarter | |||||||||||
| First Quarter | Fourth Quarter | Third Quarter | Second Quarter | First Quarter | 2024 - 2023 Change | ||||||||
| INCOME SUMMARY | |||||||||||||
| Interest revenue | $336,728 | $338,698 | $323,147 | $295,775 | $279,487 | ||||||||
| Interest expense | 137,579 | 135,245 | 120,591 | 95,489 | 68,017 | ||||||||
| Net interest revenue | 199,149 | 203,453 | 202,556 | 200,286 | 211,470 | (6)% | |||||||
| Provision for credit losses | 12,899 | 14,626 | 30,268 | 22,753 | 21,783 | ||||||||
| Noninterest income | 39,587 | (23,090) | 31,977 | 36,387 | 30,209 | 31 | |||||||
| Total revenue | 225,837 | 165,737 | 204,265 | 213,920 | 219,896 | 3 | |||||||
| Noninterest expenses | 145,002 | 154,587 | 144,474 | 132,407 | 139,805 | 4 | |||||||
| Income before income tax expense | 80,835 | 11,150 | 59,791 | 81,513 | 80,091 | 1 | |||||||
| Income tax expense | 18,204 | (2,940) | 11,925 | 18,225 | 17,791 | 2 | |||||||
| Net income | 62,631 | 14,090 | 47,866 | 63,288 | 62,300 | 1 | |||||||
| Non-operating items | 2,187 | 67,450 | 9,168 | 3,645 | 8,631 | ||||||||
| Income tax benefit of non-operating items | (493) | (16,714) | (2,000) | (820) | (1,955) | ||||||||
| Net income - operating (1) | $64,325 | $64,826 | $55,034 | $66,113 | $68,976 | (7) | |||||||
| Pre-tax pre-provision income (5) | $93,734 | $25,776 | $90,059 | $104,266 | $101,874 | (8) | |||||||
| PERFORMANCE MEASURES | |||||||||||||
| Per common share: | |||||||||||||
| Diluted net income - GAAP | $0.51 | $0.11 | $0.39 | $0.53 | $0.52 | (2) | |||||||
| Diluted net income - operating (1) | 0.52 | 0.53 | 0.45 | 0.55 | 0.58 | (10) | |||||||
| Cash dividends declared | 0.23 | 0.23 | 0.23 | 0.23 | 0.23 | - | |||||||
| Book value | 26.83 | 26.52 | 25.87 | 25.98 | 25.76 | 4 | |||||||
| Tangible book value (3) | 18.71 | 18.39 | 17.70 | 17.83 | 17.59 | 6 | |||||||
| Key performance ratios: | |||||||||||||
| Return on common equity - GAAP (2)(4) | 7.14% | 1.44% | 5.32% | 7.47% | 7.34% | ||||||||
| Return on common equity - operating (1)(2)(4) | 7.34 | 7.27 | 6.14 | 7.82 | 8.15 | ||||||||
| Return on tangible common equity - operating (1)(2)(3)(4) | 10.68 | 10.58 | 9.03 | 11.35 | 11.63 | ||||||||
| Return on assets - GAAP (4) | 0.90 | 0.18 | 0.68 | 0.95 | 0.95 | ||||||||
| Return on assets - operating (1)(4) | 0.93 | 0.92 | 0.79 | 1.00 | 1.06 | ||||||||
| Return on assets - pre-tax pre-provision - operating (1)(4)(5) | 1.40 | 1.33 | 1.44 | 1.65 | 1.71 | ||||||||
| Net interest margin (fully taxable equivalent) (4) | 3.20 | 3.19 | 3.24 | 3.37 | 3.61 | ||||||||
| Efficiency ratio - GAAP | 60.47 | 66.33 | 61.32 | 55.71 | 57.20 | ||||||||
| Efficiency ratio - operating (1) | 59.15 | 59.57 | 57.43 | 54.17 | 53.67 | ||||||||
| Equity to total assets | 12.06 | 11.95 | 11.85 | 11.89 | 11.90 | ||||||||
| Tangible common equity to tangible assets (3) | 8.49 | 8.36 | 8.18 | 8.21 | 8.17 | ||||||||
| ASSET QUALITY | |||||||||||||
| Nonperforming assets ("NPAs") | $107,230 | $92,877 | $90,883 | $103,737 | $73,403 | 46 | |||||||
| Allowance for credit losses - loans | 210,934 | 208,071 | 201,557 | 190,705 | 176,534 | 19 | |||||||
| Allowance for credit losses - total | 224,119 | 224,128 | 219,624 | 212,277 | 197,923 | 13 | |||||||
| Net charge-offs | 12,908 | 10,122 | 26,638 | 8,399 | 7,084 | ||||||||
| Allowance for credit losses - loans to loans | 1.15% | 1.14% | 1.11% | 1.10% | 1.03% | ||||||||
| Allowance for credit losses - total to loans | 1.22 | 1.22 | 1.21 | 1.22 | 1.16 | ||||||||
| Net charge-offs to average loans (4) | 0.28 | 0.22 | 0.59 | 0.20 | 0.17 | ||||||||
| NPAs to total assets | 0.39 | 0.34 | 0.34 | 0.40 | 0.28 | ||||||||
| AT PERIOD END ($ in millions) | |||||||||||||
| Loans | $18,375 | $18,319 | $18,203 | $17,395 | $17,125 | 7 | |||||||
| Investment securities | 5,859 | 5,822 | 5,701 | 5,914 | 5,915 | (1) | |||||||
| Total assets | 27,365 | 27,297 | 26,869 | 26,120 | 25,872 | 6 | |||||||
| Deposits | 23,332 | 23,311 | 22,858 | 22,252 | 22,005 | 6 | |||||||
| Shareholders' equity | 3,300 | 3,262 | 3,184 | 3,106 | 3,078 | 7 | |||||||
| Common shares outstanding (thousands) | 119,137 | 119,010 | 118,976 | 115,266 | 115,152 | 3 | |||||||
| (1) Excludes non-operating items as detailed on Non-GAAP Performance Measures Reconciliation on next page. (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 | ||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||
| 2024 | 2023 | |||||||||||||||||||
| First Quarter | Fourth Quarter | Third Quarter | Second Quarter | First Quarter | ||||||||||||||||
| Net income to operating income reconciliation | ||||||||||||||||||||
| Net income (GAAP) | $ | 62,631 | $ | 14,090 | $ | 47,866 | $ | 63,288 | $ | 62,300 | ||||||||||
| Bond portfolio restructuring loss | - | 51,689 | - | - | - | |||||||||||||||
| Gain on lease termination | (2,400 | ) | - | - | - | - | ||||||||||||||
| FDIC special assessment | 2,500 | 9,995 | - | - | - | |||||||||||||||
| Merger-related and other charges | 2,087 | 5,766 | 9,168 | 3,645 | 8,631 | |||||||||||||||
| Income tax benefit of non-operating items | (493 | ) | (16,714 | ) | (2,000 | ) | (820 | ) | (1,955 | ) | ||||||||||
| Net income - operating | $ | 64,325 | $ | 64,826 | $ | 55,034 | $ | 66,113 | $ | 68,976 | ||||||||||
| Net income to pre-tax pre-provision income reconciliation | ||||||||||||||||||||
| Net income (GAAP) | $ | 62,631 | $ | 14,090 | $ | 47,866 | $ | 63,288 | $ | 62,300 | ||||||||||
| Income tax expense | 18,204 | (2,940 | ) | 11,925 | 18,225 | 17,791 | ||||||||||||||
| Provision for credit losses | 12,899 | 14,626 | 30,268 | 22,753 | 21,783 | |||||||||||||||
| Pre-tax pre-provision income | $ | 93,734 | $ | 25,776 | $ | 90,059 | $ | 104,266 | $ | 101,874 | ||||||||||
| Diluted income per common share reconciliation | ||||||||||||||||||||
| Diluted income per common share (GAAP) | $ | 0.51 | $ | 0.11 | $ | 0.39 | $ | 0.53 | $ | 0.52 | ||||||||||
| Bond portfolio restructuring loss | - | 0.32 | - | - | - | |||||||||||||||
| Gain on lease termination | (0.02 | ) | - | - | - | - | ||||||||||||||
| FDIC special assessment | 0.02 | 0.06 | - | - | - | |||||||||||||||
| Merger-related and other charges | 0.01 | 0.04 | 0.06 | 0.02 | 0.06 | |||||||||||||||
| Diluted income per common share - operating | $ | 0.52 | $ | 0.53 | $ | 0.45 | $ | 0.55 | $ | 0.58 | ||||||||||
| Book value per common share reconciliation | ||||||||||||||||||||
| Book value per common share (GAAP) | $ | 26.83 | $ | 26.52 | $ | 25.87 | $ | 25.98 | $ | 25.76 | ||||||||||
| Effect of goodwill and other intangibles | (8.12 | ) | (8.13 | ) | (8.17 | ) | (8.15 | ) | (8.17 | ) | ||||||||||
| Tangible book value per common share | $ | 18.71 | $ | 18.39 | $ | 17.70 | $ | 17.83 | $ | 17.59 | ||||||||||
| Return on tangible common equity reconciliation | ||||||||||||||||||||
| Return on common equity (GAAP) | 7.14 | % | 1.44 | % | 5.32 | % | 7.47 | % | 7.34 | % | ||||||||||
| Bond portfolio restructuring loss | - | 4.47 | - | - | - | |||||||||||||||
| Gain on lease termination | (0.22 | ) | - | - | - | - | ||||||||||||||
| FDIC special assessment | 0.23 | 0.86 | - | - | - | |||||||||||||||
| Merger-related and other charges | 0.19 | 0.50 | 0.82 | 0.35 | 0.81 | |||||||||||||||
| Return on common equity - operating | 7.34 | 7.27 | 6.14 | 7.82 | 8.15 | |||||||||||||||
| Effect of goodwill and other intangibles | 3.34 | 3.31 | 2.89 | 3.53 | 3.48 | |||||||||||||||
| Return on tangible common equity - operating | 10.68 | % | 10.58 | % | 9.03 | % | 11.35 | % | 11.63 | % | ||||||||||
| Return on assets reconciliation | ||||||||||||||||||||
| Return on assets (GAAP) | 0.90 | % | 0.18 | % | 0.68 | % | 0.95 | % | 0.95 | % | ||||||||||
| Bond portfolio restructuring loss | - | 0.57 | - | - | - | |||||||||||||||
| Gain on lease termination | (0.03 | ) | - | - | - | - | ||||||||||||||
| FDIC special assessment | 0.03 | 0.11 | - | - | - | |||||||||||||||
| Merger-related and other charges | 0.03 | 0.06 | 0.11 | 0.05 | 0.11 | |||||||||||||||
| Return on assets - operating | 0.93 | % | 0.92 | % | 0.79 | % | 1.00 | % | 1.06 | % | ||||||||||
| Return on assets to return on assets- pre-tax pre-provision reconciliation | ||||||||||||||||||||
| Return on assets (GAAP) | 0.90 | % | 0.18 | % | 0.68 | % | 0.95 | % | 0.95 | % | ||||||||||
| Income tax (benefit) expense | 0.27 | (0.04 | ) | 0.18 | 0.29 | 0.29 | ||||||||||||||
| Provision for credit losses | 0.19 | 0.21 | 0.45 | 0.35 | 0.34 | |||||||||||||||
| Bond portfolio restructuring loss | - | 0.75 | - | - | - | |||||||||||||||
| Gain on lease termination | (0.04 | ) | - | - | - | - | ||||||||||||||
| FDIC special assessment | 0.04 | 0.15 | - | - | - | |||||||||||||||
| Merger-related and other charges | 0.04 | 0.08 | 0.13 | 0.06 | 0.13 | |||||||||||||||
| Return on assets - pre-tax pre-provision - operating | 1.40 | % | 1.33 | % | 1.44 | % | 1.65 | % | 1.71 | % | ||||||||||
| Efficiency ratio reconciliation | ||||||||||||||||||||
| Efficiency ratio (GAAP) | 60.47 | % | 66.33 | % | 61.32 | % | 55.71 | % | 57.20 | % | ||||||||||
| Gain on lease termination | 0.60 | - | - | - | - | |||||||||||||||
| FDIC special assessment | (1.05 | ) | (4.29 | ) | - | - | - | |||||||||||||
| Merger-related and other charges | (0.87 | ) | (2.47 | ) | (3.89 | ) | (1.54 | ) | (3.53 | ) | ||||||||||
| Efficiency ratio - operating | 59.15 | % | 59.57 | % | 57.43 | % | 54.17 | % | 53.67 | % | ||||||||||
| Tangible common equity to tangible assets reconciliation | ||||||||||||||||||||
| Equity to total assets (GAAP) | 12.06 | % | 11.95 | % | 11.85 | % | 11.89 | % | 11.90 | % | ||||||||||
| Effect of goodwill and other intangibles | (3.25 | ) | (3.27 | ) | (3.33 | ) | (3.31 | ) | (3.36 | ) | ||||||||||
| Effect of preferred equity | (0.32 | ) | (0.32 | ) | (0.34 | ) | (0.37 | ) | (0.37 | ) | ||||||||||
| Tangible common equity to tangible assets | 8.49 | % | 8.36 | % | 8.18 | % | 8.21 | % | 8.17 | % | ||||||||||
| UNITED COMMUNITY BANKS, INC. | ||||||||||||||||||||||
| Financial Highlights | ||||||||||||||||||||||
| Loan Portfolio Composition at Period-End | ||||||||||||||||||||||
| 2024 | 2023 | Linked Quarter Change | Year over | |||||||||||||||||||
| (in millions) | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | First Quarter | Year Change | ||||||||||||||||
| LOANS BY CATEGORY | ||||||||||||||||||||||
| Owner occupied commercial RE | $ | 3,310 | $ | 3,264 | $ | 3,279 | $ | 3,111 | $ | 3,141 | $ | 46 | $ | 169 | ||||||||
| Income producing commercial RE | 4,206 | 4,264 | 4,130 | 3,670 | 3,611 | (58 | ) | 595 | ||||||||||||||
| Commercial & industrial | 2,405 | 2,411 | 2,504 | 2,550 | 2,442 | (6 | ) | (37 | ) | |||||||||||||
| Commercial construction | 1,936 | 1,860 | 1,850 | 1,739 | 1,806 | 76 | 130 | |||||||||||||||
| Equipment financing | 1,544 | 1,543 | 1,534 | 1,510 | 1,447 | 1 | 97 | |||||||||||||||
| Total commercial | 13,401 | 13,342 | 13,297 | 12,580 | 12,447 | 59 | 954 | |||||||||||||||
| Residential mortgage | 3,240 | 3,199 | 3,043 | 2,905 | 2,756 | 41 | 484 | |||||||||||||||
| Home equity | 969 | 959 | 941 | 927 | 930 | 10 | 39 | |||||||||||||||
| Residential construction | 257 | 302 | 399 | 463 | 492 | (45 | ) | (235 | ) | |||||||||||||
| Manufactured housing | 328 | 336 | 343 | 340 | 326 | (8 | ) | 2 | ||||||||||||||
| Consumer | 180 | 181 | 180 | 180 | 174 | (1 | ) | 6 | ||||||||||||||
| Total loans | $ | 18,375 | $ | 18,319 | $ | 18,203 | $ | 17,395 | $ | 17,125 | $ | 56 | $ | 1,250 | ||||||||
| LOANS BY MARKET | ||||||||||||||||||||||
| Georgia | $ | 4,356 | $ | 4,357 | $ | 4,321 | $ | 4,281 | $ | 4,177 | $ | (1 | ) | $ | 179 | |||||||
| South Carolina | 2,804 | 2,780 | 2,801 | 2,750 | 2,672 | 24 | 132 | |||||||||||||||
| North Carolina | 2,566 | 2,492 | 2,445 | 2,355 | 2,257 | 74 | 309 | |||||||||||||||
| Tennessee | 2,209 | 2,244 | 2,314 | 2,387 | 2,458 | (35 | ) | (249 | ) | |||||||||||||
| Florida | 2,443 | 2,442 | 2,318 | 1,708 | 1,745 | 1 | 698 | |||||||||||||||
| Alabama | 1,068 | 1,082 | 1,070 | 1,062 | 1,029 | (14 | ) | 39 | ||||||||||||||
| Commercial Banking Solutions | 2,929 | 2,922 | 2,934 | 2,852 | 2,787 | 7 | 142 | |||||||||||||||
| Total loans | $ | 18,375 | $ | 18,319 | $ | 18,203 | $ | 17,395 | $ | 17,125 | $ | 56 | $ | 1,250 | ||||||||
| UNITED COMMUNITY BANKS, INC. | ||||||||||||
| Financial Highlights | ||||||||||||
| Credit Quality | ||||||||||||
| (in thousands) | ||||||||||||
| 2024 | 2023 | |||||||||||
| First Quarter | Fourth Quarter | Third Quarter | ||||||||||
| NONACCRUAL LOANS | ||||||||||||
| Owner occupied RE | $ | 2,310 | $ | 3,094 | $ | 5,134 | ||||||
| Income producing RE | 29,186 | 30,128 | 30,255 | |||||||||
| Commercial & industrial | 20,134 | 13,467 | 13,382 | |||||||||
| Commercial construction | 1,862 | 1,878 | 1,065 | |||||||||
| Equipment financing | 8,829 | 8,505 | 9,206 | |||||||||
| Total commercial | 62,321 | 57,072 | 59,042 | |||||||||
| Residential mortgage | 16,569 | 13,944 | 11,893 | |||||||||
| Home equity | 4,984 | 3,772 | 4,009 | |||||||||
| Residential construction | 1,244 | 944 | 2,074 | |||||||||
| Manufactured housing | 19,797 | 15,861 | 12,711 | |||||||||
| Consumer | 54 | 94 | 89 | |||||||||
| Total nonaccrual loans | 104,969 | 91,687 | 89,818 | |||||||||
| OREO and repossessed assets | 2,261 | 1,190 | 1,065 | |||||||||
| Total NPAs | $ | 107,230 | $ | 92,877 | $ | 90,883 | ||||||
| 2024 | 2023 | ||||||||||||||||||||
| 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 (RECOVERIES) BY CATEGORY | |||||||||||||||||||||
| Owner occupied RE | $ | 202 | 0.02 | % | $ | 35 | - | % | $ | 582 | 0.07 | % | |||||||||
| Income producing RE | 205 | 0.02 | (562 | ) | (0.05 | ) | 3,011 | 0.30 | |||||||||||||
| Commercial & industrial | 3,906 | 0.65 | 547 | 0.09 | 17,542 | 2.71 | |||||||||||||||
| Commercial construction | 20 | - | 33 | 0.01 | (49 | ) | (0.01 | ) | |||||||||||||
| Equipment financing | 6,362 | 1.66 | 7,926 | 2.05 | 6,325 | 1.62 | |||||||||||||||
| Total commercial | 10,695 | 0.32 | 7,979 | 0.24 | 27,411 | 0.83 | |||||||||||||||
| Residential mortgage | (16 | ) | - | 12 | - | (129 | ) | (0.02 | ) | ||||||||||||
| Home equity | (54 | ) | (0.02 | ) | (68 | ) | (0.03 | ) | (2,784 | ) | (1.17 | ) | |||||||||
| Residential construction | 119 | 0.17 | (13 | ) | (0.01 | ) | 341 | 0.31 | |||||||||||||
| Manufactured housing | 1,569 | 1.90 | 1,444 | 1.69 | 1,168 | 1.34 | |||||||||||||||
| Consumer | 595 | 1.33 | 768 | 1.70 | 631 | 1.37 | |||||||||||||||
| Total | $ | 12,908 | 0.28 | $ | 10,122 | 0.22 | $ | 26,638 | 0.59 | ||||||||||||
| (1) Annualized. | |||||||||||||||||||||
| UNITED COMMUNITY BANKS, INC. | ||||||||
| Consolidated Balance Sheets (Unaudited) | ||||||||
| (in thousands, except share and per share data) | March 31, 2024 | December 31, 2023 | ||||||
| ASSETS | ||||||||
| Cash and due from banks | $ | 203,932 | $ | 200,781 | ||||
| Interest-bearing deposits in banks | 758,001 | 803,094 | ||||||
| Cash and cash equivalents | 961,933 | 1,003,875 | ||||||
| Debt securities available-for-sale | 3,393,399 | 3,331,084 | ||||||
| Debt securities held-to-maturity (fair value $2,042,912 and $2,095,620, respectively) | 2,465,133 | 2,490,848 | ||||||
| Loans held for sale | 38,140 | 33,008 | ||||||
| Loans and leases held for investment | 18,374,844 | 18,318,755 | ||||||
| Less allowance for credit losses - loans and leases | (210,934 | ) | (208,071 | ) | ||||
| Loans and leases, net | 18,163,910 | 18,110,684 | ||||||
| Premises and equipment, net | 386,052 | 378,421 | ||||||
| Bank owned life insurance | 342,486 | 345,371 | ||||||
| Goodwill and other intangible assets, net | 987,539 | 990,087 | ||||||
| Other assets | 626,296 | 613,873 | ||||||
| Total assets | $ | 27,364,888 | $ | 27,297,251 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Liabilities: | ||||||||
| Deposits: | ||||||||
| Noninterest-bearing demand | $ | 6,409,659 | $ | 6,534,307 | ||||
| NOW and interest-bearing demand | 6,054,940 | 6,155,193 | ||||||
| Money market | 5,914,631 | 5,600,587 | ||||||
| Savings | 1,182,681 | 1,207,807 | ||||||
| Time | 3,595,236 | 3,649,498 | ||||||
| Brokered | 174,862 | 163,219 | ||||||
| Total deposits | 23,332,009 | 23,310,611 | ||||||
| Long-term debt | 324,854 | 324,823 | ||||||
| Accrued expenses and other liabilities | 407,915 | 400,292 | ||||||
| Total liabilities | 24,064,778 | 24,035,726 | ||||||
| Shareholders' equity: | ||||||||
| Preferred stock; $1 par value; 10,000,000 shares authorized; 3,662 shares Series I issued and outstanding; $25,000 per share liquidation preference | 88,266 | 88,266 | ||||||
| Common stock, $1 par value; 200,000,000 shares authorized, 119,136,518 and 119,010,319 shares issued and outstanding, respectively | 119,137 | 119,010 | ||||||
| Common stock issuable; 560,833 and 620,108 shares, respectively | 11,923 | 13,110 | ||||||
| Capital surplus | 2,702,807 | 2,699,112 | ||||||
| Retained earnings | 614,612 | 581,219 | ||||||
| Accumulated other comprehensive loss | (236,635 | ) | (239,192 | ) | ||||
| Total shareholders' equity | 3,300,110 | 3,261,525 | ||||||
| Total liabilities and shareholders' equity | $ | 27,364,888 | $ | 27,297,251 | ||||
| UNITED COMMUNITY BANKS, INC. | |||||||
| Consolidated Statements of Income (Unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| (in thousands, except per share data) | 2024 | 2023 | |||||
| Interest revenue: | |||||||
| Loans, including fees | $ | 283,983 | $ | 236,431 | |||
| Investment securities, including tax exempt of $1,721 and $2,110, respectively | 46,436 | 39,986 | |||||
| Deposits in banks and short-term investments | 6,309 | 3,070 | |||||
| Total interest revenue | 336,728 | 279,487 | |||||
| Interest expense: | |||||||
| Deposits: | |||||||
| NOW and interest-bearing demand | 46,211 | 17,599 | |||||
| Money market | 50,478 | 25,066 | |||||
| Savings | 706 | 538 | |||||
| Time | 36,389 | 14,658 | |||||
| Deposits | 133,784 | 57,861 | |||||
| Short-term borrowings | - | 1,148 | |||||
| Federal Home Loan Bank advances | - | 5,112 | |||||
| Long-term debt | 3,795 | 3,896 | |||||
| Total interest expense | 137,579 | 68,017 | |||||
| Net interest revenue | 199,149 | 211,470 | |||||
| Provision for credit losses | 12,899 | 21,783 | |||||
| Net interest revenue after provision for credit losses | 186,250 | 189,687 | |||||
| Noninterest income: | |||||||
| Service charges and fees | 9,264 | 8,699 | |||||
| Mortgage loan gains and other related fees | 7,511 | 4,521 | |||||
| Wealth management fees | 6,313 | 5,724 | |||||
| Gains from sales of other loans | 1,537 | 1,916 | |||||
| Lending and loan servicing fees | 4,210 | 4,016 | |||||
| Securities losses, net | - | (1,644 | ) | ||||
| Other | 10,752 | 6,977 | |||||
| Total noninterest income | 39,587 | 30,209 | |||||
| Total revenue | 225,837 | 219,896 | |||||
| Noninterest expenses: | |||||||
| Salaries and employee benefits | 84,985 | 78,698 | |||||
| Communications and equipment | 11,920 | 10,008 | |||||
| Occupancy | 11,099 | 9,889 | |||||
| Advertising and public relations | 1,901 | 2,349 | |||||
| Postage, printing and supplies | 2,648 | 2,537 | |||||
| Professional fees | 5,988 | 6,072 | |||||
| Lending and loan servicing expense | 1,827 | 2,319 | |||||
| Outside services - electronic banking | 2,918 | 3,425 | |||||
| FDIC assessments and other regulatory charges | 7,566 | 4,001 | |||||
| Amortization of intangibles | 3,887 | 3,528 | |||||
| Merger-related and other charges | 2,087 | 8,631 | |||||
| Other | 8,176 | 8,348 | |||||
| Total noninterest expenses | 145,002 | 139,805 | |||||
| Income before income taxes | 80,835 | 80,091 | |||||
| Income tax expense | 18,204 | 17,791 | |||||
| Net income | 62,631 | 62,300 | |||||
| Preferred stock dividends | 1,573 | 1,719 | |||||
| Earnings allocated to participating securities | 345 | 339 | |||||
| Net income available to common shareholders | $ | 60,713 | $ | 60,242 | |||
| Net income per common share: | |||||||
| Basic | $ | 0.51 | $ | 0.52 | |||
| Diluted | 0.51 | 0.52 | |||||
| Weighted average common shares outstanding: | |||||||
| Basic | 119,662 | 115,451 | |||||
| Diluted | 119,743 | 115,715 | |||||
| Average Consolidated Balance Sheets and Net Interest Analysis | ||||||||||||||||||||
| For the Three Months Ended March 31, | ||||||||||||||||||||
| 2024 | 2023 | |||||||||||||||||||
| (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) | $ | 18,299,739 | $ | 283,960 | 6.24 | % | $ | 16,897,372 | $ | 236,530 | 5.68 | % | ||||||||
| Taxable securities (3) | 5,828,391 | 44,715 | 3.07 | 6,059,323 | 37,876 | 2.50 | ||||||||||||||
| Tax-exempt securities (FTE) (1)(3) | 366,350 | 2,311 | 2.52 | 422,583 | 2,834 | 2.68 | ||||||||||||||
| Federal funds sold and other interest-earning assets | 674,594 | 6,805 | 4.06 | 472,325 | 3,352 | 2.88 | ||||||||||||||
| Total interest-earning assets (FTE) | 25,169,074 | 337,791 | 5.39 | 23,851,603 | 280,592 | 4.76 | ||||||||||||||
| Noninterest-earning assets: | ||||||||||||||||||||
| Allowance for credit losses | (212,996 | ) | (167,584 | ) | ||||||||||||||||
| Cash and due from banks | 221,203 | 271,210 | ||||||||||||||||||
| Premises and equipment | 386,021 | 329,135 | ||||||||||||||||||
| Other assets (3) | 1,618,315 | 1,484,936 | ||||||||||||||||||
| Total assets | $ | 27,181,617 | $ | 25,769,300 | ||||||||||||||||
| Liabilities and Shareholders' Equity: | ||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||||||
| NOW and interest-bearing demand | $ | 6,078,090 | 46,211 | 3.06 | $ | 4,499,907 | 17,599 | 1.59 | ||||||||||||
| Money market | 5,864,217 | 50,478 | 3.46 | 5,223,267 | 25,066 | 1.95 | ||||||||||||||
| Savings | 1,192,828 | 706 | 0.24 | 1,416,931 | 538 | 0.15 | ||||||||||||||
| Time | 3,596,486 | 35,944 | 4.02 | 2,348,588 | 12,313 | 2.13 | ||||||||||||||
| Brokered time deposits | 50,343 | 445 | 3.56 | 208,215 | 2,345 | 4.57 | ||||||||||||||
| Total interest-bearing deposits | 16,781,964 | 133,784 | 3.21 | 13,696,908 | 57,861 | 1.71 | ||||||||||||||
| Federal funds purchased and other borrowings | 13 | - | - | 107,955 | 1,148 | 4.31 | ||||||||||||||
| Federal Home Loan Bank advances | 4 | - | - | 453,056 | 5,112 | 4.58 | ||||||||||||||
| Long-term debt | 324,838 | 3,795 | 4.70 | 324,701 | 3,896 | 4.87 | ||||||||||||||
| Total borrowed funds | 324,855 | 3,795 | 4.70 | 885,712 | 10,156 | 4.65 | ||||||||||||||
| Total interest-bearing liabilities | 17,106,819 | 137,579 | 3.23 | 14,582,620 | 68,017 | 1.89 | ||||||||||||||
| Noninterest-bearing liabilities: | ||||||||||||||||||||
| Noninterest-bearing deposits | 6,398,079 | 7,697,844 | ||||||||||||||||||
| Other liabilities | 390,451 | 357,367 | ||||||||||||||||||
| Total liabilities | 23,895,349 | 22,637,831 | ||||||||||||||||||
| Shareholders' equity | 3,286,268 | 3,131,469 | ||||||||||||||||||
| Total liabilities and shareholders' equity | $ | 27,181,617 | $ | 25,769,300 | ||||||||||||||||
| Net interest revenue (FTE) | $ | 200,212 | $ | 212,575 | ||||||||||||||||
| Net interest-rate spread (FTE) | 2.16 | % | 2.87 | % | ||||||||||||||||
| Net interest margin (FTE) (4) | 3.20 | % | 3.61 | % | ||||||||||||||||
| (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) Unrealized gains and losses on securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $322 million in 2024 and $419 million in 2023 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) is the financial holding company for United Community, a top 100 U.S. financial institution that is committed to improving the financial health and well-being of its customers and the communities it serves. United Community provides a full range of banking, wealth management and mortgage services. As of March 31, 2024, United Community had $27.3 billion in assets, 205 offices across Alabama, Florida, Georgia, North Carolina, South Carolina, and Tennessee, as well as a national SBA lending franchise and a national equipment lending subsidiary. In 2024, United Community became a 10-time winner of the J.D. Power's award for the best customer satisfaction among consumer banks in the Southeast region and was recognized as the most trusted bank in the Southeast. In 2023, United was named by American Banker as one of the "Best Banks to Work For" for the seventh consecutive year and was recognized in the Greenwich Excellence and Best Brands Awards, receiving 15 awards that included national honors for overall satisfaction in small business banking and middle market banking. Forbes has also consistently listed United Community as one of the World's Best Banks and one of America's Best Banks. 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 - operating," "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. Further, United's management uses these measures in managing and evaluating United's business and intends to refer to them in discussions about United's operations and performance. 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.
Caution About Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In general, forward-looking statements usually may be identified through use of words such as "may," "believe," "expect," "anticipate," "intend," "will," "should," "plan," "estimate," "predict," "continue" and "potential," or the negative of these terms or other comparable terminology. Forward-looking statements are not historical facts and represent management's beliefs, based upon information available at the time the statements are made, with regard to the matters addressed; they are not guarantees of future performance. Actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial condition to differ materially from those expressed in or implied by such statements. Factors that could cause or contribute to such differences include, but are not limited to general competitive, economic, political, regulatory and market conditions. Further information regarding additional factors which could affect the forward-looking statements contained in this press release can be found in the cautionary language included under the headings "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in United's Annual Report on Form 10-K for the year ended December 31, 2023, and other documents subsequently filed by United with the United States Securities and Exchange Commission ("SEC").
Many of these factors are beyond United's ability to control or predict. If one or more events related to these or other risks or uncertainties materialize, or if the underlying assumptions prove to be incorrect, actual results may differ materially from the forward-looking statements. Accordingly, shareholders and investors should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date of this communication, and United undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for United to predict their occurrence or how they will affect United.
United qualifies all forward-looking statements by these cautionary statements.
For more information:
Jefferson Harralson
Chief Financial Officer
(864) 240-6208
Jefferson_Harralson@ucbi.com
